Sugarcane growers: SHC set aside Sindh govt’s decision of fixation of quality premium

KARACHI: The Sindh High Court on Tuesday set aside the Sindh government’s notification about fixation of quality premium payable to cane growers by the sugar mills at the end of crushing season 2018-19 at the rate of Rs.50 paisa per 40 kilogram.

The order came on the petition of Mirpurkhas sugar mills and others, who challenged the Sindh government notification issued on May 2, 2019 with regard to fixation of sugarcane price as well as quality premium payable to the cane growers at the end of crushing season at rate of Rs.50 paisa per 40 kilogram for each 0.1 percent of excess sucrose recovery above 8.7 percent determined on overall sucrose recovery basis of each mill.

The petitioner’s counsel Abdul Sattar Pirzada submitted that they have no objection on fixation of sugarcane price but the fixation of quality premium price was not placed before the provincial cabinet.

The SHC’s division bench, headed by Justice Mohammad Ali Mazhar, observed that the fixation of quality premium price was not done by the provincial cabinet and even the minutes of the meeting did not transpire that the issue of quality premium fixation was taken up by the provincial cabinet though the government decided to fixation of quality premium price under Section 16 (3) of the Sugar Factories Control Act 1950.

The court after hearing the arguments of the counsel observed that petitioners shall follow the first portion of the government notification which pertained to fixation of sugarcane price. However, the court observed that second portion of the notification with regard to fixation of quality premium was not done in accordance with the law and set aside the such impugned portion of the notification. The court directed the Sindh government to convene a meeting of provincial cabinet within 20 days and determine the quantum of quality premium under Section 16 of the Act and submit compliance report.

The sugar mills’ owners are liable to pay the growers quality premium at the end of the crushing season at such rates as may be determined by the government in proportion of the sucrose recovery of such factory in excess of the base level sucrose contents, viz. 8.7 per 40 kg.