UP sugar mills fail to comply with HC order over arrears' payout

Mills fail to comply with HC order to pay 25% of arrears to sugarcane farmers by June 15

Sugar mills in Uttar Pradesh (UP) have failed to comply with the Allahabad High Court, which had directed them to settle 25 per cent of their cane arrears to sugarcane farmers by June 15.

Hearing a petition filed by Rashtriya Kisan Mazdoor Sangathan convener V M Singh, the HC had on May 27 ordered the mills to settle 25 per cent of their respective portion of arrears by June 15.

The mills were also directed to settle 50 per cent and 75 per cent of the arrears by June 30 and July 15, respectively.

In light of this directive, UP cane commissioner Subhash Chandra Sharma had issued the payments schedule to mills, according to which Rs 2,400 crore was to be paid to sugarcane farmers by June 15.

However, the mills have managed to pay only about Rs 450 crore, which is less than 20 per cent of the stipulated payment.

Currently, the total arrears on all the 118 mills stand at almost Rs 9,500 crore, including interest payment on dues. Of this, the 94 private sugar mills alone account for Rs 8,434 crore arrears.

For the current crushing season, the total dues have piled up to Rs 20,640 crore (excluding interest on arrears), against which the mills have collectively paid Rs 11,474 crore so far.

Meanwhile, the 23 cooperative mills are burdened with Rs 1,016 crore cane dues, while the lone UP State Sugarcane Corporation unit has Rs 20 crore arrears. The next date of hearing in the case is July 28.

Earlier, the cane commissioner had told mills to abide by the HC order lest first information report would be lodged and action taken under Sugarcane Control Order.

At the start of season, UP had retained cane price at Rs 280 a quintal, while allowing mills to pay at Rs 240 a quintal upfront and deferring payment of the remaining Rs 40 per quintal to end of season.

The sugar output stands at a shade above 7.10 million tonnes for the current crushing season.