1980 PLP 804 (CLC)

This application arises out of the suit which has been filed by the plaintiffs for declaration and permanent injunction. Ad interim injunc tion was granted as prayed on 28th December 1978, on this application.

2. The facts disclosed in the plaint and the application are that the plaintiffs Nos. 1 and 2 have their Sugar Factories, situated at Ram pur, District Khairpur, and Larkana respectively. The defendant No. 2 passed an order on 2nd October 1978, under sections 10 and 14 of the Sugar Factories Control Act, 1950 (hereinafter referred to as the Act) assigning the Sukkur District to the mills of the plaintiffs and declaring certain dens of Khairpur District as `reserved area' for the Sugar Mills of the plaintiffs. Prior to the passing of the order dated 2nd October 1978, the Cane Control Board in its meeting dated 8th August 1978 had decided that the Sukkur District should be assigned to the plaintiff's Mills and it was further decided that due arrangement be made to ensure that the defendant No. 1 did not lift cane from Sukkur District which would result in creating complications in collecting cess, obviously because the defendant mill is situated in the province of Punjab. It is averred that the plaintiffs have separately entered into agreements, as required by law, with the cane growers of Sukkur District for the purchase of sugarcane and have started lifting the same from the assigned district. It is further stated that the plaintiffs have made advances and given loans to the growers of sugarcane and obtained firm commitment.

3. On these premises the plaintiffs have alleged that in spite of the decision of the Cane Control Board and the order dated 2nd October 1978, the defendant mill had started interfering with their right in the Sukkur District by purchasing and lifting sugarcane from the said Zone, it is further alleged that the defendant had opened various centres in the town and other places in the District of Sukkur for purchasing of sugar cane and was inducing the cane growers to deliver sugarcane to it by offering attractive prices.

4. The short question involved, therefore, is as to whether, on the facts as alleged, the plaintiffs are entitled to the confirmation of the order of injunction already passed.

5. In the counter-affidavit filed on behalf of defendant No. 1 it is alleged that the District Magistrate, Sukkur had prohibited the defendant from lifting of sugarcane from the Sukkur District, which order was challenged in a Constitutional Petition No. 1666/78 and the same was allowed on 2nd January 1979. The order of the respondent No. 2 is also challenged as having been passed in violation of the applicable proce dure. It is further asserted that the defendant No. 1 had advanced about Rs. 5,00,(00 to the cane growers of the Sukkur District and unless sugarcane was allowed to be lifted, at least to the corresponding extent, the money paid to the growers will be lost.

6. Both the learned counsel placed reliance on the provisions of sections 10, 13 and 14 of the Act. Sections 10 and 13 talk about reserv ed area and the obligations of the occupier of the factory and the cane rowers of that area while section 14 deals with the declaration of assign ed areas and purchase of cane therein. What is contained in section 14 is to be found in sections 10 and 13 read together. Such a reading of the sections would show that the occupier of a factory and the cane growers of the reserved as well as assigned areas are legally bound to enter into agreements for the purchase and supply of sugarcane respectively. However, there is restriction on the purchase of cane in a restricted area by the outsiders as laid down in subsection (3) of section 13 which is as under :-- "Section 13(3).-Unless the Provincial Government otherwise direct cane grown in a reserved area shall not be purchased by a purchasing agent or by any persons other than the occu pier of the factory for which such area has been reserved except by another grower for the bona fide purpose of seed." There is, however, no such restriction for the purchase of cane in respect of an assigned area. Section 14, on the contrary, lays down that in the event of failure to supply the requisite quantity of cane by the cane growers, the occupier of the factory is entitled to purchase the balance of the cane from outside the assigned area unless otherwise directed by the Cane Commissioner.

7. On the basis of the above legal premises, Mr. Khalid Anwar, learned counsel for the defendant, contended that inasmuch as Sukkur District was designated by the Cane Commissioner, as per his order dated 2nd October 1978, only as an assigned area and not a reserved area, there was no restriction for the purchase of cane by the outsiders A in the said district. The contention of the learned counsel has force because section 1 does not contain any provision such as the one, referred to above, which is contained in section 13.

8. There is yet one other aspect of the case which cannot be ignor ed. The plaintiffs have admitted that they have entered into a contract of purchase with the cane growers in the assigned area and thus in terms of section 14 the cane growers are under statutory as well as con tractual obligation to supply the requisite quantity of cane to the plaintiffs. In case of any breach on the part of the cane growers to supply the requisite quantity of cane, it is be open to the plaintiffs to take necessary action on the basis of the provisions of the section as well as on the strength of the contracts. As regards the minutes of the Cane Control Board are concerned. although the same no doubt provide for making arrangement to ensure that the defendant factory will not lift cane from Sukkur, but, such a decision of the Board has no legal sanctity in the absence of any order passed by the Cane Commissioner declaring the Sukkur District as a Reserved area:

9. The upshot of the above discussion is that the plaintiffs are not entitled to the injunction applied for and the application is dismissed with costs and the interim order dated 28th December 1978 is vacated. M. A. K. Application dismissed.