SC upholds HC decision quashing interest waiver for UP sugar mills

The Supreme Court today refused to interfere with the Allahabad High Court order by which it had quashed the decision of then Samajwadi party government in Uttar Pradesh of waiving the interest worth Rs 2000 crore, payable by sugar mill owners to sugarcane farmers.

A bench of Justices Ranjan Gogoi and R Banumathi said the high court had passed a very reasoned order and does not intend to interfere with it.

The apex court dismissed the appeal filed by Rashtriya Kisan Mazdoor Sangathan challenging the limited part of the high court order by which it had said that the government has the power to decide the issue of waiving the interest.

"You have got everything you wanted. High Court has passed a very reasoned order and considered the price of raw molasses, bagasse and press mud. We do not intend to interfere with the order," the bench said.

V M Singh, convenor of Rashtriya Kisan Mazdoor Sangathan who appeared in person, said the high court should not have held that the state government can decide the issue and the Cane Commissioner would take the final call within the next four months.

The bench said it was a very reasonable order and all aspects have been dealt by it.

The Allahabad high court had on March 9, 2017, quashed a cabinet decision of October 3, 2016, whereby interest to the tune of Rs 2000 crore, payable by sugar mill owners to sugarcane farmers, was waived.

The then Akhilesh Yadav government had waived the interest payable by mill owners on account of delayed payment to cane growers for the period 2012-14.

The then state government had said that the decision was taken in view of the fact that sugar industry was going through a bad phase and it was essential to ensure that the mills did not close down due to financial distress which would ultimately hit the farmers too.