1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.8145/2009 Gangamai Industries & Constructions Limited IInd Floor, Tapadia Terraces, Adalat Road, Aurangabad, Dist.Aurangabad – 431 001 Through its Vice President Ambadas s/o Laxman More Age 53 years, Occ-As above. .. PETITIONER VERSUS 1] State of Maharashtra Through Principal Secretary Cooperation & Textile Department, Mantralaya, Mumbai-431 032. 2] Commissioner for Sugar Maharashtra State, Sakhar Sankul, Shivaji Nagar Pune, Dist.Pune. 3] Shri Rajendra Chavan Commissioner for Sugar, Maharashtra State, Sakhar Sankul, Shivaji Nagar Pune, Dist.Pune. 4] Shri Dnyaneshwar Sahakari Sakhar Karkhana Limited, Dnyaneshwarnagar, P.O. Bhende Sakhar Karkhana-414605, 2 Tal. Newasa, Dist.Ahmednagar Through its Managing Director. 5] Union of India Through Ministry of Consumer Affairs (Department of Food & Public Distribution) Krishi Bhavan, New Delhi Through its Secretary. (Respondent nos.1 & 2 to be served through Govt.Pleader,High Court, Bench at Aurangabad. Respondent No.5 to be served through Standing Counsel.) RESPONDENTS .... Shri P.R.Patil,Advocate for petitioner Shri P.P.More,AGP for Respondents 1 and 2. Shri R.N.Dhorde holding for Shri P.S.Dighe,Advocate for respondent no.4 Shri N.B.Suryawanshi,Adv.for Intervener (in C.A.No.409/2010) .... CORAM : A.P.DESHPANDE & N.D.DESHPANDE,JJ. DATE : 10/03/2010 AND 11/03/2010 ORAL JUDGEMENT : [PER A.P.DESHPANDE,J.] 1] In view of the order passed by the Supreme Court in Civil 3 Appeal No.8525-8526 dated 17/12/2009, we had fixed this Writ Petition for final hearing vide our order dated 22/2/2010. Rule. Rule made returnable forthwith. Taken up for final hearing by consent of parties. 2] The petitioner is a company registered under the Companies Act and is engaged in the business of construction and manufacturing of sugar. The petitioner being desirous of setting up a sugar factory at Nazuk Babhulgaon, Tq. Shevgaon, Dist.Ahmednagar have taken steps in that direction. One of the requirements stipulated for under an order issued by the Ministry of Consumer Affairs, Food and Public Distribution (Department of Food and Public Distribution] 9/11/2006, is that there has to be arial distance of more than 15 Kms. radius between 2 sugar factories and no new sugar factory can be set up within the radius of 15 Kms. of any existing sugar factory in the State. Under Explanation 3 of the Sugarcane (Control) (Amendment) Order, 2006 (hereinafter referred to as the said Order for brevity), the minimum distance is to be determined as measured by Survey of India, whereas the requirement under Clause 6-B of the said Order is that before filing the Industrial Entrepreneur Memorandum with the Central Government, the concerned person shall obtain a certificate from the Commissioner of Sugar or Director (Sugar) or Specified Authority of the concerned State Government that the distance between the site where he proposes to set up sugar factory and the adjacent existing sugar factories is not less than minimum distance prescribed. 4 3] Thus, though the minimum distance is to be determined by Survey of India, nonetheless the Commissioner of Sugar is expected to issue a certificate in regard to the distance between the 2 sugar factories. The petitioner is already possessed of a certificate issued by Survey of India, which goes to certify that the distance of the sugar factory of respondent no.4 Dnyaneshwar Sahakari Sakhar Karkhana and the site of the petitioner, is 27 Kms. In tune with the requirement of obtaining a certificate from the Commissioner of Sugar provided under Clause 6-B of the Sugarcane (Control) (Amendment) Order, 2006 issued by Government order dated 10/11/2006, the petitioner filed an application with the Commissioner of Sugar. On receipt of the application, the Commissioner of Sugar issued a public notice on 1/4/2009 inviting objections, if any to the application moved by the present petitioner, for issuance of a certificate under Clause 6-B. In response to the public notice, the present respondent no.4 objected to the issuance of the certificate. The respondent no.4 objected to the setting up of sugar factory by the petitioner on various grounds, such as non-availability of adequate sugar cane supply, threat to the viability of the existing sugar factory of the respondent no.4 on account of unfair business competition, so also, on the ground that the arial distance between the 2 sites is less than the prescribed distance. 4] When the matter was pending before the Sugar Cane Commissioner, the present respondent no.4 Dnyaneshwar 5 Sahakari Sakhar Karkhana filed Writ Petition No.3063/2009, raising various objections to the setting up of the sugar factory by the present petitioner. This Court by an order dated 16/11/2009, dismissed the petition filed by the present respondent no.4 after rejecting the contentions raised in the petition. This Court also directed the Commissioner of Sugar to decide the pending application of the present petitioner moved for obtaining a certificate of arial distance. Aggrieved by the judgment and order passed by this Court dated 16/11/2009, the present respondent no.4 filed a Special Leave Petition in the Supreme Court bearing No.31797/2009. The Supreme Court granted leave and the matter is pending in Supreme Court. 5] The Commissioner of Sugar passed an order on the application moved by the petitioner on 25/27-11-2009 and rejected the same. The Commissioner of Sugar observed in the impugned order that as per the order passed in P.I.L.No.20/2006, the High Court of Bombay has directed that no new sugar factory should be granted permission and hence permission cannot be granted. A reference is also made to the interim order passed in P.I.L.No.20/2006 and the opinion of the Department of Law and Justice, opining that if sugar crushing capacity is increased, that would result in contempt of Court. Aggrieved by the order dated 25/27-11-2009, the present Writ Petition has been filed. 6] Before we proceed to consider the issue raised in the present Petition, we would like to advert to the orders passed by 6 this Court in P.I.L.No.20/06. The first order passed in P.I.L.No. 20/06 concludes with the following direction : “Until the matter is further considered by us, having given thoughtful consideration to the report submitted by Mr.R.D.Soni, we direct that the Commissioner of Sugar/and the State Government would not issue any fresh permission for new sugar factories in the State of Maharashtra. We order accordingly.” 7] Thereafter P.I.L. was listed before the Court on various occasions and various interim orders came to be passed, we chose to refer to the last order passed in the P.I.L. on 21/1/2010 disposing of few Civil Applications moved for intervention and also for direction to the Commissioner of Sugar, Pune to consider their applications for grant of permission for crushing of the sugar cane for the year 2009-10. Allowing the applications, the following operative order was passed. “We are therefore inclined to allow these Civil Applications. Accordingly, the applicants are permitted to be impleaded as party 7 respondents in the P.I.L. The Commissioner of Sugar, Pune, is directed to grant permission to the applicants for crushing of the sugar- cane for the year 2009-2010 and thereafter. This shall be subject to the condition that the State Government shall not provide any financial assistance in the nature of grant/subsidy or guarantee for the establishments of the present applicants. We further clarify that the order dated 12/7/2006 would not come in the way of the State Government in considering similarly situated applicants for opening private sugar factories, provided that no financial assistance in the nature of grant/subsidy or guarantee is granted to the said applicants. Needless to state that the applications which are allowed and so also which would be considered by the State Government shall be subject to the final decision inthe present petition.” 8 8] Thus, it can be seen that order dated 12/7/2006 does not come in the way of the State Government in considering applications for opening new private sugar factories. It is undisputed that the present petitioner is not claiming any financial assistance in the nature of grant or subsidy or guarantee from the Government and hence the conditions stipulated are not applicable. 9] According to the learned counsel for the petitioner, the reason assigned by the Commissioner of Sugar in the impugned order touching the orders passed in P.I.L.No.20/06 does not hold the field any longer, in view of the order dated 21/1/2010 clarifying the earlier order. 10] This Court in the instant Petition had passed 2 orders. First order being of 2/12/2009 and the second order being of 4/12/2009 which gave rise to further litigation. By an order dated 2/12/2009, this Court observed that it has perused the order passed in Writ Petition No.3063/2009 dated 16/11/2009 and the other relevant record produced before the Court and being of the prima facie view that there is total non-application of mind on the part of the Commissioner of Sugar in passing impugned order, this Court directed the Commissioner of Sugar, State of Maharashtra to remain present before the Court on 4/12/2009. A show cause notice was also issued as to why proceedings for Contempt of Court be not initiated against the Commissioner of Sugar. The Commissioner of Sugar appeared before the Court 9 on 4/12/2009 in compliance of the order dated 2/12/2009. The learned Assistant Government Pleader on instructions from Commissioner of Sugar tendered apology and assured that Arial Distance Certificate would be issued by the Commissioner within 2 days. The statement was accepted and the Court further proceeded to grant stay to the impugned order. As a matter of fact, no purpose could be achieved by staying an order which is not executable or which goes to reject an application moved by the petitioner and so this is correctly pointed out by learned counsel for respondent no.4. Be that as it may. 11] In furtherance of the assurance given to the Court, the Certificate of Aerial Distance has been issued by the Commissioner of Sugar on 5/12/2009. It is interesting to note that though the respondent no.4 had filed objection to the issuance of Aerial Distance Certificate in response to the public notice issued by the Commissioner of Sugar on 1/4/2009 and though the respondent no.4 herein had impleaded the present petitioner as a party respondent in Writ Petition No.3063/2009, the present petitioner did not implead the respondent no.4 as party respondent. On coming to know of the orders passed by this Court on 2nd and 4th December 2009, the present respondent no.4 filed Special Leave Petition in the Supreme Court primarily on the ground that the said two orders dated 2nd and 4th December 2009 are bad in law being in violation of principles of natural justice. The Supreme Court, after granting leave, allowed the Appeal No.8525-8526/2009 and set aside the order passed 10 by this Court dated 2nd and 4th December 2009, by issuing direction to the present petitioner to implead (appellant in the Supreme Court) viz. present respondent no.4 as party respondent. The respondent no.4 thereafter, came to be impleaded as party respondent in the present petition. The Supreme Court directed the respondent no.4 to file its reply to the application for interim relief to the main writ petition within 2 weeks from the date of the order. Further affidavit if any was directed to be filed by the petitioner within 1 week thereafter and this Court is directed to reconsider prayer for interim relief made by the petitioner and pass appropriate order within 5 weeks from the date of the order, without being influenced by the observations made in the earlier orders passed by this Court so also order passed by the Apex Court. It is in these circumstances, that we had taken up the Writ Petition for final disposal. 12] In the above set of facts, the learned counsel for the petitioner contends that the impugned order passed by the Commissioner of Sugar, refusing to issue a certificate under Clause 6-B (1) of the Sugarcane (Control) (Amendment) Order, 2006, is wholly unsustainable and without jurisdiciton. Inviting our attention to Explanation 3 of the said Order, it is contended that the question of determination of the minimum distance is in the domain of Survey of India. Once the Aerial Distance Certificate is issued by Survey of India, the Commissioner of Sugar has only to perform ministerial act, to issue a certificate as 11 is contemplated by Clause 6-B(1) of the said Order. Per contra, the learned counsel for respondent no.4 has contended that the Commissioner of Sugar acts as a quasi-judicial authority in the matter of issuance of certificate under Clause 6-B of the said Order. On careful perusal of various clauses in the Government Order dated 10/11/2006, it can be safely said that the Survey of India is the only authority, who is vested with power to determine the minimum distance which is regulated by Clause 6-A. Clause 6-A of the said Order mandates that no new sugar factory shall be set up within the radius of 15 Kms. of any existing sugar factory or another new sugar factory in a State or two or more States. Having regard to Explanation-1, which goes to define an existing sugar factory, there cannot be any iota of doubt that respondent no.4, need be treated as an existing sugar factory. Explanation-3 is relevant for the purpose of determining the scope of jurisdiction of the Commissioner of Sugar while issuing the certificate under Clause 6-B of the said Order. 13] The authority vested with power to determine the minimum distance, is Survey of India and if that be so, the Commissioner of Sugar cannot take any decision contrary to the decision of Survey of India in the matter of measurement of distance from an existing sugar factory and the proposed sugar factory. Clause-B lays down the requirements for filing the Industrial Entrepreneur Memorandum. Before filing the Industrial Entrepreneur Memorandum with the Central Government, a proposed sugar factory need to obtain a certificate from the Commissioner of 12 Sugar that the distance between the site where he proposes to set up a sugar factory and adjacent existing sugar factories and new sugar factories if any is not less than the minimum distance prescribed by the Central Government or the State Government, as the case may be. The certificate to be issued by Commissioner of Sugar has to be in conformity with the certificate issued by Survey of India as the said authority is vested with the power to determine the minimum distance. If that be so, then it is obvious that the Commissioner of Sugar, while issuing a certificate under clause 6-B(1) only performs a ministerial act of issuing a certificate in consonance with the certificate issued by Survey of India. If that be the position, we have no iota of doubt that as the Survey of India has already issued a certificate in favour of the present petitioner that the petitioner’s proposed sugar factory is at a distance of 27 Kms. from the existing sugar factory of respondent no.4, the Commissioner of Sugar could not have rejected the application moved by the present petitioner. 14] The impugned order thus is illegal and deserves to be quashed and set aside. Suffice it to state that while exercising the power and authority under Clause 6-B, the Commissioner of Sugar cannot entertain objections other than the one in relation to the aerial distance. The question of viability of the existing sugar factory and/or the question of unhealthy competition between two sugar factories, is not germane in exercise of power under Clause 6-B. Even otherwise a petition filed by respondent no.4 in this Court is already dismissed. Touching the said aspects and 13 against the said judgment and order passed in the Writ Petition, Special Leave Petition is filed and pending in Supreme Court, wherein leave is already granted. 15] In the result, we hold that the impugned order passed by the Commissioner of Sugar is unsustainable in law. Thus, the same is quashed and set aside. We direct respondent no.2 Commissioner of Sugar, State of Maharashtra, to issue Aerial Distance Certificate to the petitioner. Rule made absolute in above terms. 16] At this stage, Shri Dhorde, learned counsel for respondent no.4 seeks stay of this order for a period of 6 weeks. Having regard to the fact that Special Leave Petition is already pending in the Supreme Court, we grant stay to this order, for a period of 4 weeks. Authenticated copy is allowed. 17] Civil Application No.409/2010 for intervention is rejected as the intervenor had not objected to the grant of Aerial Distance Certificate asked for by the petitioner before the Commissioner of Sugar in response to the public notice issued by him. [N.D.DESHPANDE,J] [A.P.DESHPANDE,J.] umg/wp8145-09