Purchase of sugarcane, payments made: Commissioner seeks 2-year data from sugar mills in 7 days

LAHORE: The Cane Commissioner Punjab has directed the sugar mills to provide complete information of cane purchased and payment made against it for the last two years within a week to ascertain how much of interest amount has been paid to the growers on account of delayed payments.

Cane Commissioner Punjab Muhammad Zaman Wattoo issued these directions through an order passed on November 10, 2020, on a petition filed by different sugar mills on the issue of payment of mark up on delayed payments under Rule 14 (10) of the Punjab Sugar Factories (Control) Rules, 1950.

The Cane Commissioner admitted in his order that record of purchase of cane at purchase centres can only be preserved by the sugar mills for a period of two years as envisaged by Rule 16 (8) of the Punjab Sugar Factories (Control) Rules, 1950.

The verdict said that the cane commissioner office through a letter No. C.C. Admin (2)-17/19 dated 11.09.2020, directed the Occupiers/General Managers of all the sugar mills in the Punjab to provide information about payment of cane growers' dues on the proforma which included grower-wise details of date of cane purchased and date of its payment. This information was required to ascertain how much of interest amount has been paid to the growers on account of delayed payments under Rule 14 (10) of the Punjab Sugar Factories (Control) Rules, 1950.

The verdict further said that earlier on perusal of data provided by the sugar mills, he came to know of the malpractice of not paying the interest @ 11% to the sugarcane growers on account of delayed payments beyond 15 days as is mandatory under Rule 14 (2) of the Punjab Sugar Factories (Control) Rules, 1950.

It is an established fact that majority of the cane growers are small farmers and they do not have ready money to purchase inputs like seed, fertilizer, diesel for tractors/engines, pay bills of electric tube-wells etc. Such growers have to take loan from various banks and money lenders/commission agents for purchase of inputs. The rate of interest charged by the local money lenders or the commission agents and the banks is quite high.

In case a sugar mill delays payment of the cane growers' dues, the growers have to pay, in any case, interest on the loan that they obtain. In all fairness, they are entitled to receive interest @ 11% per annum for delayed payments beyond 15 days to pay the same to the money-lender/bank.

It is a painful fact that, as per a conservative estimate, the sugar mills have, over the years, gulped billions of growers' dues only on this count. The information about the date of sugarcane purchased and the payment of price made was sought to determine the amount of interest payable to the growers.

As many as 14 petitioner sugar mills had challenged the order/letter through Writ Petition No.45469/2020 and the Lahore High Court vide order dated 29.09.2020 directed the undersigned/Cane Commissioner to decide the objections raised by them and not to take coercive action against the petitioners.

The petitioners contented in the petition that the data sought by the cane commissioner for more than two years which was in violation of Rule 16 (8) of the Punjab Sugar Factories (Control) Rules, 1950. Seeking of information of payment was against the fundamental rights enshrined in the Constitution of Pakistan, they argued. They further contended that such information could only be sought if assigned or reserved areas were notified.

Copyright Business Recorder, 2020