SHC directs sugar mills to pay quality premium to growers of last 20 years

The Sindh High Court has directed the provincial cane commissioner to determine the sucrose recovery rate for the crushing seasons of last 20 years.

The court has also instructed the sugar mills to pay outstanding quality premium to the growers.

The direction came on a petition filed by the Sindh Growers Alliance and others on Tuesday.

The petitioners sought an action against the owners of sugar mills for not paying quality premium to the growers for the crushing seasons of the last 20 years – between 1998-99 and 2018-19 – and also the non-payment of the minimum procurement price of sugar cane at Rs182 per 40kg to the growers for the crushing season 2018-19.

The Sindh Growers Alliance submitted in the petition that the owners of sugar mills were liable to pay the growers quality premium at the end of the crushing season. The counsel of petitioners, Syed Mureed Ali Shah, submitted that the sugar mills had gone in litigation against the raise of 32 paisa per 40kg to 50 paisa per 40kg and obtained stay from the higher judiciary.

The counsel submitted that the Supreme Court had dismissed the petitions of the sugar mills on March 5, 2018 and observed that the grant of quality premium was just and fair based on statutory provisions.

He argued that the apex court held that “the impugned notification was validly issued” and observed that in the future a notification as per the past practice for payment of quality premium should be issued along with a notification of fixation of the minimum procurement price of sugar cane and it should be paid to the growers not later than two months after the crushing season was over.

He submitted that the Sindh government had issued a notification in compliance with the Supreme Court order and directed the sugar factories in the province to pay quality premium to the cane growers at the end of the crushing season 2018-19 at the rate of fifty paisa per 40kg cane for each 0.1 per cent of excess sucrose recovery above 8.7 per cent determined on the overall sucrose recovery basis of each mill.

The lawyer said despite the SC judgment, the sugar mills did not pay quality premium to the sugar cane growers for the crushing seasons of last 20 years and it was clearly proved beyond any doubt that 37 sugar mills were actively involved in “continuously violating, disobeying, obstructing and making mockery of the judgment of the SC and they were liable to be punished for violating the court orders”.

The Sindh cane commissioner submitted that his office was making efforts in view of the SC judgment for recovery of quality premium but the sugar mills failed to comply the judgment of the court.

The counsel of sugar mills and growers submitted that payment could only be made after determination of relevant sucrose recovery per crushing season according to notifications issued in respect of each crushing season.

The SHC’s division bench, headed by Justice Mohammad Ali Mazhar, after hearing the arguments observed that the parties had consensually agreed to settle the matter on determination of sucrose recovery rate for the crushing seasons of last 20 years in accordance with the law and payment of quality premium to growers.

The court observed that the cane commissioner shall determine the sucrose recovery rate for the crushing seasons of last 20 years within twenty days.

The court observed that each grower shall apply to the respective sugar mill with their claim for the payment of quality premium and submit copy of application to the cane commissioner and after verification of such claim of such grower, the sugar mill shall make the payment.

The court observed that in case an amount was not paid to the grower, the cane commissioner shall take action against the sugar mills for non-payment of quality premium.