Case: Anand Agro Chem India Ltd Vs. Suresh Chandra

3. The facts in nutshell are as follows. Respondents 1 to 3 supplied sugarcane to the sugar mill of the appellant in the yearfor which the appellant has not paid the price in spite of several representations made by the respondents 1 to 3 herein. This led to the filing of Writ Petition inno.14936 of 2013 by respondents 1 to 3 seeking for issuance of the Writ of Mandamus directing the appellant herein to release the sugarcane price to them. The Division Bench of the High Court after hearing both sides directed the District Magistrate, Hathras to take immediate action against the Directors and occupiers of themill against whom several orders have been passed under the U.P. Sugarcane (Regulation and Supply) Act, 1913 and it further observed in the order that the District Magistrate may in exercise of his powers cause arrest of the Directors and occupiers of the sugar mill to recover the dues and in the event of such arrest, they will not be released until they have paid the entire amount due against them. Themill aggrieved by the said order preferred a Special Leave Petition in SLP(C) no.16633 of 2013 and this Court by order dated 1.5.2013 dismissed the petition by observing thushave heard Shri Sanjay Parikh, learned counsel for the appellant and perused thereading of the order under challenge shows that the appellant has not paid Rs.16.12 crores to the farmers for the crushing year0, which includes the price of sugarcane, the cane development commission and the interest. It is also borne out from the record that vide letter dated 24.11.2012, the Director of the appellant had assured the Cane Commissioner that the company will pay Rs.160 lacs as the price of the cane within two weeks and an amount of Rs.700 lacs in installments, the first of which will be paid on 15.01.2013, but the company did not fulfill its assurance.In the above backdrop, it is not possible to find any fault with the direction given by the Division Bench of the High Court and there is absolutely no justification for thisinterference with the impugned order.The special leave petition is accordinglyar mill filed an application in the pending Writ Petition in the High Court of Judicature at Allahabad seeking for stay of arrest of the Directors pursuant to the order dated 26.4.2013 and the Division Bench of the High Court after –hearing both sides and after referring to the earlier orders held that no modification/vacation of the order dated 26.4.2013 is required and, accordingly, rejected the prayer of stay of arrest. Challenging the said order themill has preferred the present appeal.

Court's reasoning:
8. The Division Bench of the Allahabad High Court in its order dated 26.4.2013 has directed the District Magistrate, Hathras, namely, the Collector to take immediate action against the Directors and occupiers of themill against whom several orders have been passed under the U.P. Sugarcane (Regulation and Supply) Act, 1913 and this Court has confirmed the said order. The Division Bench in the present application considered the plea of theappellant for the stay of arrest and after hearing both sides rejected the said plea by the impugned order and we find no error inWe say so firstly because order dated 26th April, 2013 passed by the Division Bench of the Allahabad High Court directing the District Magistrate to take immediate action against the Directors of the sugar mill has already been affirmed by this Court inquestion whether or not one of the Directors who is said to be 65 years old could be arrested as a defaulter and committed to prison under Section 171 of the Uttar Pradesh Revenue Code, 2006, could and indeed ought to have been raised by the appellants either before the High Court or before this Court in appeal preferred against the order passed by the High Court. No such contention was, however, urged at that stage.10. Secondly, because the company and its Directors have not made their promises good by paying even the amounts which they had offered to pay. A plain reading of order dated 1st May, 2013 passed by this Court in SLP (C) No.16633 of 2013 extracted above would show that the company and its Directorshad assured the Commissioner that they would pay Rs.160 lacs towards price of sugarcane within two weeks besides an amount of Rs.700 lacs to be paid in installments, the first of which installment was to be paid on 15th May, 2013. No such payment was, however, made by the company and its Directors. That apart, the statement made at the bar on 7th October, 2013 by Dr. Rajeev Dhawan, learned senior counsel, for the appellant that the Directors would pay Rs.4.55 crores is also sought to be withdrawn on the ground that the same was made under a mistake. It is evident that the company and its Directors have been despite promises made on their behalf committing breach of such assurances on one pretext or the other.11. Thirdly, because there is nothing before us to suggest that the company and its Directors are incapable of raising funds for liquidating the outstanding liability towards dues payable to the farmers. Simply because the sugar factory has been attached, is no reason for us to assume that the company or its Directors are in any financial distress thereby disabling them from making the payments recoverable from them. The fact situation in thepresent case is, therefore, completely different from that in Jolly George Varghese case (supra) relied upon by Mr. Ram Jethmalani.12. In the light of the above, we see no compelling reason for us to interfere with the order passed by the High Court in exercise of our extraordinary jurisdiction. We regret to say that the amounts due to the farmers towards price of the sugarcane and incidentals remains to be paid to them for several years in the past thereby accumulating huge liability against the company. That is not a happy situation nor can repeated invocation of the process of law by the appellant be a remedy for it.