TaxTMI 
TaxTMI 
2023 (10) TMI 1500
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....ading to the filing of the writ appeal, briefly narrated, are as follows: 2.1. Sugarcane is declared as an essential commodity by the Government of India under the Essential Commodities Act, 1955 [in short "EC Act"]. In exercise of powers conferred on it under Section 3 of EC Act, the first respondent issued Sugarcane (Control) Order, 1966 in connection with production, regulation and transportation of sugarcane. The object of the Act and the Control Order 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....
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.... 3. The writ petition, after contest, came to be dismissed along with connected writ petitions, vide common order dated 13.02.2019, against which the instant writ appeal is filed. 4. Mr. P.S. Raman, learned Senior Counsel appearing for the appellant submits that Clause 5(A) of the Control Order stood omitted and hence, 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 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 ....
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....tation of statutes which is embodied in the said Sections will be applicable and if so, the omission will take effect only prospectively, that is for the period after 22.10.2009. The learned Additional Solicitor General, in support of his contentions, has placed reliance upon the following decisions: (i) Mahabir Sugar Mills Pvt. Ltd., v. Union of India [1974 SCC Online All 335] (ii) A.P. State Electricity Board v. Union of India [1988 Supp SCC 371] (iii) P.V. Mohd Barmay Sons v. Director of 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 ....
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....ane (Control) Order, 1966 was issued by the Central Government in exercise of the power conferred under Section 3 of the EC Act, which contained 12 Orders / Provisions and 3 Schedules. Clause 3 of the Control Order deals with Fair and Remunerative Price of sugarcane payable by producer of sugar, for brevity, it shall be referred as 'FRP'. Clause 5 provides for additional price for sugar cane purchase, which shall be in additional to the FRP. 9.5. Clauses 5 and 5A which stood prior to the amendment is quoted hereunder: "5. Additional price for sugarcane 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 suc....
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....7) Where any payment has been made in accordance with the directions issued by the Central Government under sub- clause (2) of Clause 5 as it stood immediately before the commencement of the Sugarcane (Control) (Amendment) Order, 1962, then, notwithstanding anything contained in the foregoing provisions of this clause, such payment shall be deemed to have been made in lieu of the payment provided for in this clause as if that sub-clause were in force when the direction was issued or payment was made. [5-A. Additional price for sugarcane purchased on or after 1st October, 1974.- (1) Where a producer of sugar or his agent purchases sugarcane 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 ....
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....bject to the provisions of sub-clause (4), the additional price shall become payable to a sugarcane grower if he in performance of his agreement with a producer of sugar supplies not less than 85 per cent of the sugarcane so agreed: [Provided that the additional price shall become payable to a sugarcane grower, even when he supplies less than 85 per cent of the sugarcane so agreed, if for the same supply he has not been subjected to any penalty by or under any Central or State Act or any rules or orders made hereunder for his failure to supply 85 per cent of sugarcane so agreed.] (8) Where the additional price determined under subclause (2) or sub-clause (3), as the case may be, is paid to a sugarcane growers' 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 b....
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....nsiders appropriate within thirty days: Provided that the Collector may, for the reason to be recorded in writing allow the submission of claims after the period so specified if he is satisfied that there was sufficient cause for not submitting such claim earlier. (14) If the amount recovered is less than the amount specified in the certificate under sub-clause (11), the Collector shall distribute the amount so recovered to the concerned growers of the sugarcane or the concerned sugarcane growers co-operatives in proportion to the ratio determined by the Collector on the basis of the sugarcane supplied by the concerned growers of sugarcane or the sugarcane growers' co-operative society as the case may be. (15) If the amount recovered and distributed under sub- 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 throu....
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....nt, shall pay the amount, which it fixes above the fair and remunerative price as fixed by the Central Government, to the grower of sugarcane or to the sugarcane growers' cooperative society, as the case may be" 11. The primordial contention of the appellant is that by virtue of 2009 amendment to the Sugarcane Control Order, Statutory Minimum Price (SMP) was substituted by Fair Remunerative Price (FRP), which includes consideration of additional factor in fixing cane price, namely reasonable returns and consequent upon the amendment, Clause 5A and Second Schedule to the Control Order stood omitted with effect from 22.10.2009 and at this juncture, the first respondent has no jurisdiction to determine "L" factor for the sugar season 2004-2009. It is further contended that Clause 5A of the Control Order stood omitted and 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 Cl....
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.... subordinate legislation made under a statute ceases to have effect after repeal of the statute. This result can be avoided by insertion of saving clauses providing to the contrary. When a statute is repealed and reenacted, Section 24 of the General Clauses Act provides for continuation of any appointment, notification, Order, scheme, form, rule or bye-law made or issued under the repealed statute insofar as it is not inconsistent with the provisions re-enacted. Such appointments, notifications, Orders etc., are deemed to be made under the corresponding provisions of the new statute and continue to be in force unless superseded by appointments, notifications, Orders, etc., made or issued under the new statute. 15. Law is a game of words - this quote holds true when courts are presented with the challenging task of differentiating between terms which sometimes 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 t....
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...."." The aforesaid judgment neither deals with the distinction between the terms omission and repeal, nor were any arguments regarding the same were raised before the Bench. It simply dealt with the applicability of Section 6 of the General Clauses Act in context of the rules and upholds Rayala Corporation judgment. But reading between the lines of Kolhapur Canesugar judgment, it can be said that it makes no distinction between repeal and omission. In para 37 of the judgment, the Apex Court states that: "37. The position is well known that at common law, the normal effect of repealing a statute or deleting a provision is to obliterate it from the statute book as completely as if it had never been passed, and the statute must be considered as a law that never existed. To this rule, an exception is engrafted by the provisions of Section 6(1). If a provision of a statute 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 ....
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....ovision in the same way as it happens in repeal. The Court discussed the two terms and concluded that "it is clear that repeals may take any form and so long as a statute or part of it is obliterated, such obliteration would be covered by the expression "repeal" in Section 6 of the General Clauses Act." The Apex Court then went ahead and nullified the effect of the above five-Judge Bench judgment with respect to difference between repeal and omission. The Apex Court held that: "31... once it is found that Section 6 itself would not apply, it would be wholly superfluous to further state that on an interpretation of the word "repeal", an "omission" would not be included. We are, therefore, of the view that the second so-called ratio of the Constitution Bench in Rayala Corporation (P) Ltd. cannot be said to be a ratio decidendi at all and is really in the nature of obiter dicta." (emphasis 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 re....
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....he future course of action in case of an amendment. The 'intention' of the legislature does not become apparent at the time of amendment which leaves it for the Court to 'interpret' the legislative intent and policy behind such repeal, omission and substitution. 24. Thus, it is for the Court to interpret the legislative intent and policy behind such repeal, omission and substitution. 25. The sheet anchor of the argument of the appellants is that after the amendment in 2009 to the Sugarcane Control Order, deleting the Statutory Minimum Price and substituting Fair and Remunerative Price consequently omission of Second Schedule with effect from 22.10.2009 leads to a situation where the first respondent has no jurisdiction to determine the "L" Factor for the sugar seasons 2004-2005 to 2008-09. It is further contended that omission of a Second Schedule with effect from 22.10.2009 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. 26. The Writ Court, taking into consideration ....
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.... order and it never intended to modify or obliterate them altogether. 31. The learned Judge has rightly held in the impugned order that the question of going into what is the effect of repeal or omission or deletion become entirely academic in the facts and circumstances of the case. 32. The learned Senior Counsel for the appellant also raised a contention that Section 6 of the General Clauses Act will not be applicable to Sugarcane (Control) Order, which is a subordinate legislation. The said contention of the learned Senior Counsel cannot be countenanced for the reason that in the light of the Constitution Bench judgments of the Hon'ble Supreme Court cited supra, the terms 'repeal' and 'omission' interchangeably used having same meaning and therefore, the omission of Section 5A of the Sugarcane Control (Amendment) Order, 2009 would apply only prospective in nature and it cannot be construed 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 evidenc....