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TMI Blog2023 (10) TMI 1500X X X X Extracts X X X X X X X X Extracts X X X X ..... 009 is a deletion and no action can be taken on deleted / omitted provision since Section 6 of the General Clauses Act would have no application to a Control Order which is neither an enactment nor a regulation in terms of Section 6 of the General Clauses Act. The Writ Court, taking into consideration the scope of Essential Commodities Act, the object of the Sugarcane Control Order, the decisions of the Hon'ble Supreme Court in Union of India v. Cynamide India Ltd and another [1987 (4) TMI 478 - SUPREME COURT] and K. Ramanathan v. State of Tamil Nadu and another [1985 (2) TMI 249 - SUPREME COURT], observed that no attempt can be permitted to be made to dilute the object and if done, would be against the public interest. The right of cane growers to be entitled for Statutory Minimum Price (SMP) is a statutory right. It accrues on the date when supply of sugarcane is made to the sugar mills. The Central Government, though thought fit to introduce a new system of determining fair price and brought into effect Fair Remunerative Price, that would not in any manner affect the rights of cane growers to be entitled to SMP, which was very much available in the Sugarcane Control Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued thereunder is to ensure that there is an adequate supply of sugarcane during every sugar season for production of sugar, having regard to the demand for sugar for domestic consumption. 2.2. The Scheme of the Order prior to the year 2009 was that the Central Government determined a minimum price called the Statutory Minimum Price (SMP) under Clause 3 of the Order. This price is fixed based on detailed study and recommendations made by the Commission for Agricultural Cost and Price (CACP) considering the relevant factors mentioned in Clause 3. Clause 5-A price had to be calculated as per the formula provided in the Second Schedule to the Order. The Schedule provided for the determination of an 'L' Factor, which was usually determined by the first respondent as soon as possible after the end of sugar year (October to September), considering the cost schedule and return recommended by the specified authority. The first respondent lastly fixed 'L' factor for the year 2003-04 on 06.09.2005, but however had not determined 'L' Factor for the sugar years 2004 to 2005 to 2008-2009. 2.3. According to the appellant, due to delay in declaring the additional pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to enactments and regulations and the Control Order issued in exercise of the executive power of the Government of India under Section 3 of the Essential Commodities Act, will not fall within the definition of enactment under the General Clauses Act. It is further submitted that the Control Order is neither an Act nor a regulation and hence, Section 6 of the General Clauses Act does not apply. The learned Senior Counsel for the appellant further submitted that even when Clause 5A and the Second Schedule were there in the Control Order, "L" Factor can be fixed by taking note of empirical data of the entire country and not based on two States viz., Tamil Nadu and Pondicherry and even assuming there is power to determine the "L" factor, the private Sugar Mills are entitled to plead set off, since they have made payments to cane growers, namely, the payments made on the State Advisory price, which is over the price fixed under Clause 3 of the Control Order. It is contended by the learned Senior Counsel for the appellant that the Writ Court erred in holding that 2009 amendment to the Sugarcane Control Order is prospective in nature and will not affect rights already ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Enforcement [1993 Supp (2) SCC 724] 6. Mr. Haja Nazirudeen, learned Additional Advocate General appearing for the second respondent would contend that the appellant Association Mill owners are bound to act in conformity with the terms of the contract entered into with the sugarcane growers and the vested right or the absolute right of the cane growers to receive the amount as being fixed by the Central Government cannot be denied and however, contrary to the terms as agreed between the mill owner and the sugarcane grower, the appellant had ventured into asserting that by virtue of 'omission' of Clause 5A, the mill owner is not liable to pay the amount which was accrued and the right was crystalized at the time of effecting the supply. The learned Additional Advocate General has relied upon the following judgments: (i) State of Orissa and another v. M/s. M.A. Tulloch & Co., [(1964) 4 SCR 461 : AIR 1964 SC 1284] (ii) Fibre Boards Private Ltd., Bangalore v. Commissioner of Income Tax, Bangalore [(2015) 10 SCC 333] (iii) Shree Bhagawati Steel Rolling Mills v. Commissioner of Central Excise and another [(2016) 3 SCC 643]. 7. This Court has considered the submissions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcane purchased.- (1) Where a producer of sugar or his agent purchases any sugarcane from a grower of sugarcane or a growers' cooperative society during each of the four successive years beginning on the 1st day of November, 1958, the producer shall, in addition to the minimum price of sugarcane fixed under sub-clause (1) of Clause 3 pay to the grower or the cooperative society, as the case may be, an additional price, if found, due, in accordance with the provisions 6 [of the First Schedule] hereto annexed. (2) Nothing in sub-clause (1) shall apply to the purchase of sugarcane,-- (a) where such sugarcane is used for the production of sugar in a newly established factory until the expiry of three years commencing from the year in which the factory is so established; (b) where the purchase is made by a producer of sugar, which is a co-operative society, from the members of that cooperative society. (3) If the Central Government is satisfied that during any year a factory has made no profit or has made inadequate profit, that Government, may by order in writing, exempt either wholly or partially, any producer of sugar from payment of the additional price due from him under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cane from a sugarcane grower during each sugar year, he shall, in addition to the minimum sugarcane price fixed under Clause 3, pay to the sugarcane grower an additional price, if found due in accordance with the provisions of the Second Schedule annexed to this Order. (2) The Central Government or the State Government, as the case may be, may authorise any person or authority, as it thinks fit for the purpose of determining the additional price payable by a producer of sugar under sub-clause (1) and the person or authority as the case may be, who determines the additional price, shall intimate the same in writing to the producer of sugar and the sugarcane grower connected with the supply of sugarcane to such producer of sugar. (3) (a) Any producer of sugar or sugarcane grower, who is aggrieved by any decision of the person or authority referred to in sub-clause (2), may, within thirty days from the date of communication of such decision under that subclause, appeal to the Central Government or the State Government as the case may be: Provided that the Central Government or the State Government, as the case may be, may, if it is satisfied that the appellant had sufficient cau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... co-operative society or the local sugarcane growers' association of whatever name it may be called, it shall disperse the said additional price to such of its member who has supplied not less than 85 per cent of the agreed sugarcane in performance of his agreement with it, within one month of the receipt of such additional price by it from the producer of sugar. (9) The additional price payable but not actually paid in view of sub-clause (7) shall be added to the amount found payable for the following sugar year arrived at as per provisions of the Second Schedule. [(10) In case, the additional price determined under sub-clause (2) or sub-clause (3), as the case may be, remains unpaid on account of the sugarcane grower not coming forward to claim it 3 [x x x x x], it shall be deposited by the producer of sugar with the Collector of the District in which the factory is situated, within six months of the close of the sugar year. The Collector shall pay out of the amount so deposited all claims, considered payable by him and preferred before him within three years of the close of the sugar year in which the sugarcane was supplied to the factory. The amount still remaining undisburs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub- clause (14) is less than the amount specified in the certificate under sub-clause (11), the Collector shall proceed to recover the remaining amount as if it were arrears of land revenue till the full amount is recovered and distributed to satisfy the remaining claims. (16) If the amount is given to the concerned sugarcane growers' co-operative societies, it shall distribute the amount through cheque, draft, or any other recognised banking instrument on any Scheduled Bank to the concerned sugarcane growers within ten days of the receipt of the amount from the Collector. (17) If the concerned sugarcane grower or the concerned sugarcane growers' co-operative society do not come forward to claim or collect the amount so recovered by the Collector within three years from the date of the public notice referred to in sub-clause (13), the unclaimed amount shall be deposited by the Collector in the Consolidated Fund of the State.] Explanation.--For purposes of this clause and the Second Schedule.-- (1) "Sugarcane grower", includes a grower of sugarcane, a sugar growers' co-operative society, or a sugarcane growers' association of whatever name it may be called and who enters into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceased to have effect from 22.10.2009 and such omission is not saved in terms of Section 6 of the General Clauses Act, 1897, since it applies only to enactments ad regulations and the Control Order issued in exercise of executive power of the Government of India under Section 3 of the EC Act, will not fall within the definition of enactment under the General Clauses Act and since the Control Order is neither an Act nor a regulation, Section 6 of the General Clauses Act does not apply. "12. Section 6 of the General Clauses Act reads as follows: "6. Effect of repeal: ?Where this Act, or any [Central Act] or Regulation made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not- (a) revive anything not in force or existing at the time at which the repeal takes effect; or (b) affect the previous operation of any enactment so repealed or anything duly done or suffered thereunder; or (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or (d) affect any penalty, forfeiture or punishment incurred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s appear to have a similar connotation. For example, the words 'repeal' 'substitute' and 'omission' have different tenor in a literal sense but tend to denote a similar meaning when used in the context of any amendment of law. While the words themselves may not cause a conflict, it's the consequences of the amendment on the rights and liabilities of the parties that have led to the courts differentiating between these terms. In the aforementioned backdrop, we will discuss the way the Supreme Court has dealt with these three terms used by the legislature while amending any law and whether the conflict between these words continues to be a cause of melee in interpretation. 16. One of the earliest authorities which brought up the question of interpretation between 'repeal' and 'omission' is the five-Judge Bench judgment of the Supreme Court in Rayala Corporation (P) Ltd. v. Director of Enforcement, New Delhi [(1969) 2 SCC 412]. The Apex Court brought to the fore Section 6 of the General Clauses Act, 1897 (the GC Act) for the purpose of distinguishing between the terms 'repeal' and 'omission' since Section 6 saves the power of prosecution and punishment for acts committed in a rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatute is unconditionally omitted without a saving clause in favor of pending proceedings, all actions must stop where the omission finds them, and if final relief has not been granted before the omission goes into effect, it cannot be granted afterwards. Savings of the nature contained in Section 6 or in special Acts may modify the position. Thus the operation of repeal or deletion as to the future and the past largely depends on the savings applicable." (emphasis supplied) From the emphasised lines above, it can be seen that the Court uses the term repeal, omission and deletion interchangeably. This is also inferable that in case a provision is omitted, Section 6 may change the position which is contrary to Rayala Corporation judgment. Rayala Corporation supra clearly states that Section 6 of GCA is only applicable to the matters of repeal. So even though it upheld Rayala Corporation judgment, it did not distinctly lay out the distinction between the two terms. Further, both the cases (Kohlapur Canesugar and Rayala Corporation) have not considered Section 6-A of the General Clauses Act, which has been reproduced hereinafter: "6-A. Repeal of Act making textual amendment in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mphasis supplied) The Apex Court even declared that the above two five-Judge Bench decisions in Rayala Corporation case and Kolhapur Canesugar case were per incuriam, as they did not consider Section 6-A of the General Clauses Act. The Apex Court with this effect held that: "33. A reading of this section would show that a repeal by an amending Act can be by way of an express omission. This being the case, obviously the word "repeal" in both Section 6 and Section 24 would, therefore, include repeals by express omission. The absence of any reference to Section 6-A, therefore, again undoes the binding effect of these two judgments on an application of the 'per incuriam' principle." 20. The same two-Judge Bench of the Hon'ble Supreme Court in Fibre Boards case, once again decided the issue in detail in Shree Bhagwati Steel Rolling v. Commissioner of Central Excise [(2016) 3 SCC 643] and held that delete and omit are used interchangeably, so that when the expression repeal refers to delete, it would necessarily take within its ken an omission as well. The Court further observed that all these expressions only go to form and not to substance. It also reiterated its stand in Fib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on can be taken on deleted / omitted provision since Section 6 of the General Clauses Act would have no application to a Control Order which is neither an enactment nor a regulation in terms of Section 6 of the General Clauses Act. 26. The Writ Court, taking into consideration the scope of Essential Commodities Act, the object of the Sugarcane Control Order, the decisions of the Hon'ble Supreme Court in Union of India v. Cynamide India Ltd and another [(1987) 2 SCC 720] and K. Ramanathan v. State of Tamil Nadu and another [(1985) 2 SCC 166], observed that no attempt can be permitted to be made to dilute the object and if done, would be against the public interest. 27. The right of cane growers to be entitled for Statutory Minimum Price (SMP) is a statutory right. It accrues on the date when supply of sugarcane is made to the sugar mills. The Central Government, though thought fit to introduce a new system of determining fair price and brought into effect Fair Remunerative Price, that would not in any manner affect the rights of cane growers to be entitled to SMP, which was very much available in the Sugarcane Control Order at the relevant time during which supply of sugarcane ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstrued retrospectively. 33. It is trite law that if the amendment is substantive in nature or if it affects the vested rights of parties, then it will have a prospective effect but if it is procedural in nature, i.e., if the amendment changes jurisdiction, affects evidence, pleadings, or practice only, then it can have a retrospective effect too. It has also been held by the Supreme Court in the case of K.C. Arora v. State of Haryana [AIR 1987 SC 1858] that if the statute does not specifically provide for the retrospective application, then the statute will be said to have prospective effect only. Therefore, this Court is of the view that the said contention of the learned Senior Counsel for the appellant is liable to be rejected. 34. The effect of Section 6 of General Clauses Act is not to repeal anyone of those laws or abrogate them. Its object is to simply by-pass them when they are inconsistent with the provisions of Essential Commodities Act or the orders made thereunder. The said principles has been laid down by the Hon'ble Supreme Court in M/s. Ram Chandra Mawa Lal, Varanasi and Others. v. State of U.P. and Others [1984 (Suppl) SCC 28]. 35. Nowhere in the amendment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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