The Maharashtra Rajya Sahakari Sakhar Karkhana Sangh, which intervened in the matter, has been directed by the State to formulate a policy for the disbursal of funds and has been directed to furnish the details within two weeks. The State Government has been given two weeks to decide on the policy after it is finalised by the Sangh.

The bench were hearing two petitions filed by the Mohanrao Shinde Co-operative Sugar Factory and the Kagal Shetkari Co-operative Sugar factory where the petitioners alleged that the BJP-Shiv Sena Government had failed to disburse funds towards its share capital in their co-operatives. The Mohanrao Shindeco-operative in Miraj was set up in 1990 and has a crushing capacity of 3,500 metric tonnes per day covering an area of 90 villages in the area.

Arguing on behalf of the Shinde co-operative, advocate Ashutosh Kumbhakoni said that the co-operative which was given a letter of intent in 1990 had already bought 316 acres of land, expecting the State Government's share to come through. On a share capital of Rs 18 crore, the State Government owes the Mohanrao Shinde co-operative, around Rs 15 crore. The share of the members in the co-operative, amounting to around Rs 3 crore has already been collected by the members.

The matter refers to the state of affairs in the sugar co-operative sector where it is alleged that relatives and kin of sitting ministers in the State Government who are starting their co-operatives are getting funds, though this too is paltry.

Intervening in the case was the Maharashtra Rajya Sahakari Sakhar Karkhana Sangh which has 175 members of which 125 members are in the process ofcommissioning. Arguing on the issue, the Sangh pointed out that the member companies under the Sangh has got paltry sums of around a few lakhs of rupees from the State Government which could not help the factories set themselves up. Due to the delay on the part of the State to disburse funds, most of the co-operatives, are declared sick even before they can take off.