HIGH COURT OF UTTARAKHAND, AT NAINITAL Amendment Application No.4990 of 2010 IN Writ Petition No.2001 of 2009 (M/S) Kashipur Sugar Mills Ltd. … Petitioner Versus State of Uttarakhand and others …. Respondents Dated:- 21st July, 2010 Hon’ble Tarun Agarwala, J. Heard Mr. Dayan Krishnan, the learned counsel duly assisted by Mr. Gautam Narain and Mr. Vipul Sharma, the learned counsel for the petitioner and Dinesh Dwivedi, the learned senior counsel assisted by Mr. Abhishek Chaudhary and Mr. Prateek Dwivedi, the learned counsel for the respondent no.4. 2. The respondent no.4 India Glycols Ltd. was granted a licence under Section 4 of the U.P. Sugarcane (Purchase Tax) Act, 1961 for manufacture of rab, which in turn was used by the said respondent as a raw material for the manufacture of alcohol and chemicals. Under the Act, the licence is granted for one year and is renewed on a year to year basis. This manufacturing unit apparently is located within 6-7 kilometres of an existing factory known as Kashipur Sugar Mills Ltd., which is engaged in the manufacture of sugar by vacuum pan process. 3. The bone of contention between two parties is the supply of sugarcane from the reserved area of the petitioner. It is alleged that on account of the manufacturing unit of respondent no.4 coming into existence from 20.03.2004 onwards, the bonded cane started dwindling, which resulted in less manufacture of sugar and non utilization of the petitioner’s crushing capacity. The petitioner made complaints before the Cane Commissioner indicating that the cane reserved for the petitioner was diverted illegally to the crushing unit of respondent no.4. Such complaints apparently fell on deaf ears and, ultimately, when the licence of respondent no.4 was being renewed for the season 2008- 2009, the petitioner filed an objection before the Cane Commissioner contending that the licence should not be renewed since respondent no.4 had violated with impunity, the terms and conditions of the licence granted to it. Amongst various grounds leveled, the main ground apparently, which comes to the forefront is, that the respondent no.4 was purchasing the sugarcane from the bonded area of the petitioner’s sugar factory. Inspite of objecting, the Cane Commissioner by an order dated 27.09.2008 renewed the licence of respondent no.4. The petitioner, being aggrieved by the said order of renewal, filed an appeal before the appellate authority under the U.P. Sugarcane (Purchase Tax) Act, 1961. The appellate authority, after considering the matter, passed an order dated 30th January, 2009 issuing certain directions. For facility, the said directions are extracted hereunder:- “1. The Respondent No. 1 Cane & Sugar Commissioner Uttarakhand shall issue a Show Cause Notice to the Respondent No.2 M/s India Glycols Ltd., Kashipur, District Udham Singh Nagar as to why action to cancel the License dated 27.09.2008 issued to them be initiated. 2. The Respondent No. 1 shall ensure word by word compliance of orders passed by the Hon’ble Supreme Court in Civil Appeal No. 4425 / 2007 (SLP No. 473/2006). In case any situation of contempt arises it would be the total responsibility of Cane & Sugar Commissioner, Uttarakhand. 3. The Respondent No. 1 shall ensure compliance of the Hon’ble BIFR order dated 1.2.2008 and complying the order shall initiate all necessary action immediately. As far as the allegations mentioned by the Appellant in appeal Page No. 9 and 10 against the Respondent No. 1, 2 and 3 and the prayers in this regard, in this connection I appoint a two Member’s Committee. In this Committee No. (1) a Senior Faculty member shall be nominated by the Director, National Sugar Institute, Kanpur, Uttar Pradesh. No. (2) one Officer of the rank of Additional Secretary of the State Government, who has good knowledge of Sugar Industry even if he is presently working in some other Department. For the Second Member I nominate Shri N.K. Joshi, IAS, Additional Secretary, Uttarakhand Government, Health and Education Department. He shall be the Chairman of this Committee and this Committee shall submit 3 its enquiry report within 15 days of nomination of first member of the Committee. 4. The Respondent No. 1 shall ensure that the Respondent No. 2 is provided supply of quantity of sugarcane in accordance with the basic allotment. The Respondent No. 1 shall ensure supply of allotted 10 lac quintals of cane to the Respondent No. 2 as per his Order No. 3055/2009 dated 06.01.2009. It has been mentioned in the application filed today by the Respondent No. 4 that Sugar mills of the State are getting less quantity of cane against their allotment. The Respondent No. 1 shall ensure necessary action to see that the Respondent No. 2 does not make illegal purchase of sugarcane more than the original basic allotment and undesirable and illegal crushing is not allowed.” 4. It transpires that upon an application of respondent no.4, the said order was reviewed by the appellate authority and a fresh order dated 10th February, 2009 was passed exparte. The petitioner, being aggrieved by the said order, filed a Writ Petition No.476 of 2009 which was disposed of. The order dated 10.02.2009 was set aside and the order of the appellate authority dated 30th January, 2009 was modified with the following directions, namely:- “8. Be that as it may, the perusal of all the four directions are for the Cane Commissioner to pass an order in accordance with the provisions of the Act after giving a show cause notice to respondent no. 4. In fact regarding direction no. 2 and 4, counsel for the respondent no. 4 has no objection and he has only objection regarding direction no. 1 and 3. The objection of the counsel for the respondent no. 4 regarding direction no. 3 is entirely misplaced inasmuch as the appellate authority had only directed that the Cane Commissioner shall ensure compliance of the BIFR’s order dated 1.2.2008 initiating all necessary action immediately and it further states that the allegations of the petitioner regarding the diversion of the bonded sugar cane to respondent no. 4 must be looked into by a committee which has been constituted. This court finds that the directions are perfectly in order and with a view to get to the truth of the matter, therefore, no interference needs to be called for except that while complying the order of the BIFR dated 4 1.2.2008, the concerned authority shall also keep the interest of the State in mind. The counsel for the respondent no. 4 further states that inter alia, it has been stated in the order of the BIFR dated 1.2.2008 that the petitioner shall be free to export entire molasses produced by it without ceiling limits. It goes without saying that in case there is any existing policy of the State Government regarding diversion of export of molasses, the same is liable to be looked into by the concerned authority as well. With this proviso or clarification, this Court finds no good ground for interference as far as direction no. 2, 3 and 4 are concerned. Learned counsel for the respondent no. 4 has pointed out that regarding compliance of the BIFR’s order dated 1.2.2008, a writ petition has been field by the State Government, which is subjudice before this Court. It goes without saying that in case, the matter is subjudice before this Court, all action of the concerned authorities shall be subject to the decision or order of this Court. 9. Learned counsel for the respondent no. 4 raised objection on direction no. 1, whereby a direction was given by the appellate authority to the Cane Commissioner to initiate procedure regarding the cancellation of licence, which was granted to respondent no. 4. It is clarified that no action will be taken by the respondent no. 2 i.e. the Cane & Sugar Commissioner, Uttarakhand regarding direction no. 1 however in case there is any finding by the Committee on these allegation, the Cane Commissioner shall thereafter initiate proceedings regarding cancellation of licence, as directed presently in direction No. 1, of the Appellate Authorities’ earlier order. ” 5. A perusal of the order of the appellate authority dated 30th January, 2009 as modified by the order of the High Court dated 15.04.2009 contemplated that an enquiry committee would be constituted, which would consider various allegations levelled against respondent no.4, especially with regard to the lifting of the sugarcane from the bonded area of the petitioner and, based on such report, the Cane Commissioner was required to pass a fresh order. 6. The petitioner alleged that the committee had not submitted a report or rather, no action was being taken by the enquiry committee and, accordingly, the present writ petition was filed seeking the following reliefs:- “(a) Issue a writ in the nature of mandamus or any other appropriate writ, order or direction directing the respondent no. 2 to keep the licence dated 30.9.2009 issued to the respondent no. 4 in abeyance till the conclusion of the enquiry by the Inquiring Officer and consequent proceedings; and (b) Issue a writ in the nature of mandamus or any other appropriate writ, order or direction, directing the Respondents not to permit the respondent no. 4 to commence operations till the conclusion of the enquiry by the Inquiring Officer and consequent proceedings; and (c) Issue a writ in the nature of mandamus or any other appropriate writ, order or direction, directing the Respondent to ensure the inquiry currently being conducted by Shri N.K. Joshi, Inquiring Officer be concluded within a period of 15 days; and (d) Issue an appropriate writ directing the Respondent no. 2 to comply with order dated 30.1.2009 of the State Government as upheld / modified by the Hon'ble Court by its judgment dated 15.4.2009; and (e) Issue an appropriate writ directing the Respondents no. 1 and 2 to comply and implement BIFR orders dated 8.1.2008 and subsequent directions; and (f) Pass any writ, order or direction as may be deemed appropriate in the facts and circumstances of the case.” 7. The petitioner prayed basically that till the submission of the enquiry report by the Committee, the licence of respondent no.4 with regard to manufacture of rab should be kept in abeyance and that respondent no.4 should not be allowed to commence manufacturing operations till the conclusion of the enquiry. The petitioner further prayed that the respondents should be directed to complete the enquiry expeditiously. This court, while entertaining the writ petition, passed directions to the State Government to ensure that the enquiry is completed. It has come on record that the enquiry has been made and an enquiry report has been submitted before the authority concerned. 8. Based on the said enquiry report, the petitioner has filed an amendment application seeking permission of the court to amend the writ petition by addition of paragraph 44(a) to 44(f) in the writ petition and also praying for addition of the following reliefs, namely:- “(aa) issue a writ, order or direction in the nature of mandamus directing the inquiry officer, Shri N.K. Joshi to examine and investigate, in a time bound manner, the Form- VI documents furnished by the Respondent No. 4 so as to determine whether the Respondent No. 4 is purchasing the bonded cane of the Petitioner; or in the alternative. (bb) Issue a writ, order or direction in the nature of writ cancelling the licence of respondent no 4 in terms of the admitted violations of licence conditions as brought out by the report of the inquiry committee. (cc) issue a writ, order or direction in the nature of mandamus directing the respondent No. 2 not to renew the licence and permit granted to the Respondent No. 4 in the light of the express findings of the Inquiry Committee that there have been licence violations. (dd) Issue a writ, order or direction in the nature of mandamus directing the Respondent No. 2 to furnish to the petitioner the Form VI submitted by the respondent No. 4 in respect of the seasons 2005-06 to 2009-10” 9. By the aforesaid amendment application, the petitioner sought a relief seeking a writ of mandamus directing the enquiry officer to further investigate the matter in a time bound matter and examine Form No.VI issued in favour of the respondent no.4 and further determine as to whether respondent no.4 had purchased the rab from the bonded area of the petitioner or not and, if necessary, cancel the licence of respondent no.4. The petitioner further prayed that the authority should be directed not to renew the licence of respondent no.4 in the light of the express findings given by the enquiry committee. 10. The learned counsel for the petitioner submitted that the amendment application was necessary to bring on record the subsequent 7 events and that certain directions were necessary since the petitioner has no efficacious remedy to seek a relief for further direction since the express direction given by the appellate authority in the appeal of the petitioner as modified by the order of the writ court has not been complied with by the enquiry committee. The learned counsel for the petitioner submitted that the enquiry committee has abdicated its power and jurisdiction and that since the directions of the appellate authority had not been complied with, the amendment was necessary so that the complete adjudication of the matter was done and complete justice was done between the parties. The learned counsel for the petitioner submitted that the court had a wide discretion in the matter of amendment of pleadings and that the amendment was necessary in order to determine the real controversy involved in the matter. In support of his submission, the learned counsel for the petitioner placed reliance upon a decision of the Supreme Court in Revajeetu Builders & Developers Vs. Narayanaswamy & sons & others 2009 (10) SCC 84. 11. On the other hand, the learned counsel for the respondent no.4 submitted that the amendment sought by the petitioner was totally unnecessary and that the scope of the writ petition could not be enlarged and that the writ petition had been rendered infructuous and such amendment should not be allowed. 12. As stated earlier, the bone of contention is the use of sugarcane in the bonded area of the petitioner. There are allegations and counter allegations with regard to the supply of sugarcane to the petitioner as well as to respondent no.4. A perusal of the enquiry report indicates that while dealing with the issue of use of sugarcane from the bonded area of the petitioner, the enquiry committee found that it cannot be conclusively proved as to whether the respondent no.4 had used the sugarcane from the bonded area of the petitioner. The enquiry committee found that Form No.VI issued in favour of respondent no.4 was required to be examined in detailed, for which the parties may 8 appear before the Cane Commissioner and place their evidence. Such Form No.VI and other evidence would be considered by the Cane Commissioner in arriving at a conclusion as to whether the cane supplied to respondent no.4 was from the bonded area of the petitioner and, consequently, would take a decision as to whether there was a violation of the terms and conditions of the licence. The petitioner is basically aggrieved by this portion of the direction of the enquiry report, for which the petitioner has filed the present amendment application seeking a further relief in the nature of mandamus commanding the enquiry committee to investigate and pass further orders. 13. Having heard the learned counsel for the parties at length, the court finds that primarily the main relief which the petitioner had sought was for the conclusion of the enquiry pursuant to the direction of the appellate authority dated 30th January, 2009 as modified by the order of the writ court dated 15.04.2009. The petitioner also prayed that till the conclusion of the enquiry, the respondent no.4 should be restrained from manufacturing rab pursuant to the licence granted to them. Since the enquiry has been concluded and a report has been submitted by the committee, the writ petition, in my opinion, has been rendered infructuous. 14. The additional relief sought in the amendment application cannot be granted. The enquiry committee has stipulated that the Cane Commissioner was required to consider Form VI and examine other evidence and that the parties could appear before the Cane Commissioner and place their facts and evidence, which would be examined by the Cane Commissioner. Such direction, in my opinion, does not amount to any abdication of powers nor does it violate any direction of the appellate authority as modified by the order of the writ court. Certain other findings have been given by the enquiry report pursuant to the directions of the appellate authority and the totality of the report of the enquiry committee would be considered afresh by the Cane Commissioner in the light of the observation made by the enquiry report. If the Cane Commissioner finds from the perusal of Form No.VI issued in favour of the respondent no.4 and such other evidence that is brought before it that bonded cane has been used by respondent no.4, the Cane Commissioner would take appropriate measures and proceed with the matter with regard to the cancellation and / or renewal of licence of respondent no.4. This court cannot issue a writ cancelling the licence of respondent no.4 or issue a direction to respondent authority not to renew the licence of respondent no.4 since such powers are with the authority conferred under the U.P. Sugarcane (Purchase Tax) Act, 1961. 15. In the light of the aforesaid, the amendment sought by the petitioner is not necessary since the issue involved initially in the present writ petition has been set at rest and the amendment is not necessary as it does not determine the controversy involved in the petition. This court does not find any cogent reason to allow the amendment application nor does it find that the scope of the writ petition should be enlarged. Consequently, the amendment application is rejected. However, in the light of the aforesaid, this court finds it necessary to issue certain directions to the competent authority, namely, the Cane Commissioner. The Brief Holder is directed to intimate the enquiry committee to submit the enquiry report before the Cane Commissioner within two weeks from today, if it has not been submitted so far. The Cane Commissioner will consider the enquiry report in the light of the observation made therein and the observation made in this order coupled with the directions made by the appellate authority in its order dated 30th January, 2009 as modified by the order of the High Court dated 15.04.2009 and take an appropriate measures in complying with the said orders. It would be open to the petitioner and respondent no.4 to present their versions of the matter with regard to the supply of bonded cane. The Cane Commissioner will take appropriate measures and pass further orders within four weeks from the date of the production of a certified copy of this order. (Tarun Agarwala, J.) Dated 21.07.2010 LSR