Calcutta, Nov 5: Sugar mills in Bihar led by Belsund Sugar have won a 23-year battle with the State Government, with the Supreme Court ruling that levy of market fee and purchase tax is untenable.A review petition filed by the Bihar State Agricultural Marketing Board in September this year was also rejected by the Supreme Court. ``No case is made out for interference in review proceedings. The review petitions are accordingly dismissed,'' the court said in its October 7 order.
Under the Bihar Agricultural Produce Markets Act of 1960, sugar factories were required to pay market fee on sugarcane, sugar and molasses. After the factories lost their case in the Patna high court, they moved the Supreme Court.
The appeals, pending since 1977, were heard recently by a five-judge constitution bench which gave its judgment on August 10. The mills' case was argued by senior advocate Shanti Bhushan.
The bench set aside various judgments of the Patna high court with regard to levy of market fee on sugarcane, sugar and molasses.
Justice SB Majumdar held (in Belsund Sugar vs The State of Bihar and others) that although these products fell in the category of ``agricultural produce,'' the provisions of the Bihar Agricultural Produce Markets Act will not be applicable to them because they are wholly governed by special Acts/ provisions.
Referring to the provisions of the Sugarcane (Control) Order of 1966, thecourt held that it operated in the same field in which the Bihar Sugarcane Act of 1981 operates and both are complementary to each other. The general provisions of the state Act get excluded and superseded by the Central legislation, the court ruled.
The Supreme Court directed that its decision will have only prospective effect, i.e., market fees already collected from sugar mills will not be required to be refunded while fees not collected will not be payable hereafter.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.