Karnataka cane farmers to file contempt case against mills

Miffed over delay in payment of cane arrears for 2013-14 amounting to Rs 1,803 crore

Annoyed with the delay in payment of cane arrears by sugar mills in the state, despite Karnataka High Court directing them, the sugarcane farmers’ body is contemplating to file a ‘contempt of court’ case in the high court. Sugar mills have kept pending payment of cane arrears amounting to Rs 1,803 crore for 2013-14.

On November 6, the high court had ordered sugar mills to pay Rs 2,500 per tonne cane price for 2013-14 as fixed by the state government. However, even after a month, sugar mills have not paid arrears. Instead, sugar mills have approached the state government to give them a financial package.

The state government, which intervened in the matter, has told mills to pay arrears in two instalments of Rs 200 each (most of the mills had paid Rs 2,100 per tonne last year and kept arrears of Rs 400 per tonne). It had asked them to pay Rs 200 per tonne immediately and gave them a moratorium of two years for the balance Rs 200 per tonne. However, mills claimed that their financial position was not sound and asked the government to give them a financial package for the first instalment as well.

“Mills have started crushing after the government assured to waive purchase tax and value added tax for three years without even consulting sugarcane farmers. We are totally against the government’s direction to mills for payment of arrears in two instalments. It is a clear case of contempt of court because the high court had told mills to pay at once,” said Kurubur Shanthkumar, president, Karnataka Sugarcane Growers’ Association.

He said the farmers’ body would file a contempt of court case in the high court if mills fail to make the payment immediately. “The government and mills talked to each other and arrived at a solution convenient to mills. If the government had announced Rs 2,500 per tonne cane price during the Assembly session in Belagavi one year ago. Now, the government is holding session again in Belagavi next week. Farmers will lay siege to the Suvarna Vidhana Soudha (state secretariat) at Belagavi and protest,” Shanthkumar said.

He said the government also allowed mills to pay cane price for the current season on ex-mill basis, which is against the state advisory price (SAP) Act. Last year, out of 60 mills, 46 had paid ex-field price and had agreed to pay this year as well. “Farmers will not accept change in this formula and fight for payment of ex-field cane price,” he said.

It is expected that thousands of farmers will gather in front of the Vidhana Soudha in Belagavi and protest against the government’s changed policy stance, which is against the interests of farmers, Shanthkumar added.

Meanwhile, all 60 sugar mills have started crushing cane for the year 2014-15.