No conflict in Centre fixing minimum and state higher advised price for sugarcane: SC

The Supreme Court on Wednesday held that there is no conflict in the central government fixing the minimum price and the state government the higher "advised price" for sugarcane.

A five-judge bench presided over by Justice Arun Mishra said there is no inconsistency or repugnancy in fixing the “advised price” or “remunerative price” by the state government and the “minimum price” by the central government.

The top court upheld the decision of another five-judge bench in 'UP Cooperative Cane Unions Federations vs West UP Sugar Mills Association and Others' (2004), which stated that there was no conflict in exercise of powers by the central government in fixing the “minimum price” and in fixing the “advised price” by the state government.

The court noted that by virtue of Entries 33 and 34 of List III (Concurrent List) of the seventh schedule of the Constitution, both the central government as well as the state government did have the power to fix the price of sugarcane.

"The central government having exercised the power and fixed the “minimum price”, the state government cannot fix the “minimum price” of sugarcane. However, at the same time, it is always open for the state government to fix the “advised price” which is always higher than the “minimum price"," the bench, also comprising Justices Indira Banerjee, Vineet Saran, M R Shah and Aniruddha Bose, said.

The court also noted that the Sugarcane (Control) Order, 1966 which has been issued under Section 16 of the UP Sugarcane (Regulation of Supply and Purchase) Act, 1953 conferred power upon the state government to fix the remunerative or advised price at which sugarcane can be bought or sold which shall always be higher than the minimum price fixed by the Central Government.

However, in the case where the “advised price” fixed by the state government is lower than the “minimum price” by the central government, the provisions of central enactments would prevail and the“minimum price” fixed by the central government would prevail.

The five-judge bench examined the matter on a reference by a three-judge bench seeking clarification on a number of issues including if central government has the exclusive power to fix the price of sugarcane.