| Content Provider | Supreme Court of India |
|---|---|
| e-ISSN | 30484839 |
| Language | English |
| Access Restriction | NDLI |
| Subject Keyword | Essential Commodities Act 1955:s. 3 – Sugarcane(Control) Order 1966 – clause 6A 6C & 6D –Restriction on setting two sugar factories |
| Content Type | Text |
| Resource Type | Law Judgement |
| Jurisdiction | India |
| Case(s) Referred | Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 Referred Case 4 Referred Case 5 |
| Case Type | Appeal |
| Court | Supreme Court of India |
| Disposal Nature | Appeal Allowed |
| Headnote | Essential Commodities Act, 1955: s. 3 – Sugarcane(Control) Order, 1966 – clause 6A, 6C & 6D –Restriction on setting two sugar factories – Time limit for implementing Industrial Entrepreneur Memorandum (IEM) – In 2010, the appellant applied for IEM which was acknowledged by Govt. of India on the basis of a certificate regarding aerial distance between the existing sugar factory (Respondent no. 1) set up in 1974 and the nearby proposed sugar factory – Writ petitions were filed challenging the grant of IEM to the Appellant, one on the ground of aerial distance of proposed sugar factory and existing factory was more than 15 kms and that the proposed sugar factory falls within the radius of 500 meters from the bank of river thereby falling under no development zone – High Court held that the appellant is required to comply with all laws including the anti-pollution, environmental protection and ecology; and that the issue of aerial distance certificate cannot be reopened again–Subsequently the State of Maharashtra directed that in terms of proviso to Clause 6A of the Control Order, 1966 no new sugar factory would be set up within the radius of 25 kms of any existing sugar factory or any other new factory – Thereafter, the time limit for implementing industrial entrepreneur memorandum was amended – Appellant then sought NOC in view of the order of the High Court which was not granted by State authorities – Consequently, the appellant applied for extension of time and change of location due to earlier location being no development zone and was accepted – Writ petition by the existing sugar factory challenging grant of extension and change of location – Government allowed the extension a couple to times till 2020– Another writ petition filed by the existing sugar factory challenging grant of extension and change of location – High Court held that the appellant had not taken any effective steps within the period of two years from the date of the acknowledgement of EMI; that the IEM stood de-recognized before the Sugar Control Order was amended on 26.08.2016 which extended the period of implementation;that extensions were granted in violation to the provisions of the Rules and the Statute; and that as per the amendment, the new sugar factory had to be at a distance of not less than 25 kms – Issue arose as regards, whether in the absence of any interim order against the appellant in the first round of litigation, the period during which writ petitions were pending are liable to be excluded; whether the State/Central Government was justified in excluding such period while granting extension of IEM; whether the lis initiated against the appellant is a sufficient reason to exclude the period spent in such litigation and was a reasonable ground for the State/Central Government to extend IEM; whether the amended Control Order in terms of proviso to Clause 6C as amended by the State of Maharashtra on 03.12.2011 would be applicable when the High Court in the earlier writ petition has held that the issue of Aerial Distance Certificate cannot be reopened at the instance of the appellant or any other party again, and whether the IEM stands lapsed on the failure on the part of entrepreneur to set up the sugar factory and start production within the time specified in Clause 6C or such lapsing would be only after an order in terms of Clause 6D of the Control Order is passed – Held: Latin maxim ‘Actus Curiae Neminem Gravabit’, states that the act of the Court will not prejudice anyone – During the whole litigation history, the appellant was at the receiving end of the writ petitions, thus, the period spent in such lis cannot be used against him – Though there was no interim order passed in the writ petitions, such petitions created a cloud on the right of the appellant to set up a sugar factory at the location earmarked and to commence commercial production – Writ petitions remained pending for a period of four years, the period spent in defending such writ petitions was validly taken into consideration by the State/Central Government to grant extension of time limit fixed in the Control Order – Extensions were given when the second round of litigation was pending before the High Court due to which the appellant was not able to take effective steps – Decision of the competent authority to grant extensions of time was a proper exercise of the powers – the subsequent amendment in the Control Order would not have any application towards the IEM already issued – Unless the performance guarantee is forfeited, there is no lapsing of IEM –Twin conditions have to be fulfilled, (i) failure to set up plant and to commence production and then (ii) the forfeiture of the performance guarantee – Second will not arise unless the first is satisfied and the second step cannot be undertaken, without complying with an opportunity of personal hearing in terms of Clause 6D of the Control Order – Unless the necessary consequences of de-recognition of IEM are undertaken, there is no automatic lapsing of IEM – Appellant had furnished a performance guarantee of Rs. 1 crore, however, no steps taken either by State Government or by the Central Government to forfeit such performance guarantee inasmuch as not even a show cause notice was issued – Thus, a conclusion cannot be drawn that the IEM is deemed to be lapsed automatically only on account of lapsing of time – Order passed by the High Court, is unsustainable and is set aside. |
| Judge | Hon'ble Mr. Justice Hemant Gupta |
| Neutral Citation | 2022 INSC 717 |
| Petitioner | Swami Samarth Sugars And Agro Industries Ltd. |
| Respondent | Loknete Marutrao Ghule Patil Dnyaneshwar Sahakari Sakhar Karkhana Ltd & Ors. |
| SCR | [2022] 17 S.C.R. 54 |
| Judgement Date | 2022-07-13 |
| Case Number | 4021 |
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