REGISTERED No. D- (D) -72 रजिस्ट्री सं ० डी-(डी) -72
भारत का राजपत्र The Gazette of India
असाधारण
EXTRAORDINARY
भाग II-खण्ड 2
PART II-Section 2
प्राधिकार से प्रकाशित
PUBLISHED BY AUTHORITY
सं०49]
नई दिल्ली, सोमवार, नवम्बर 27 ,1978 / प्रपहायला 6 , 1900 NEW DELHI , MONDAY, NOVEMBER 27 , 1978 / AGRAHAYANA 6 , 1900 No. 49]
इस भाग में भिन्न पृष्ठ संख्या दी जाती हैं जिससे कि यह अलग संकलन के रूप में रखा जा सकें ।
Separate paging is given to this Part in order that it may be filed as a separate compilation
LOK SABНА
The following Bill was introduced in Lok Sabha on the 27th November , 1978 : -
BILL NO . 162 OF 1978
A Bill to provide for the temporary taking over , in the public interest , of the management of certain sugar undertakings in certain circumstances .
WHEREAS for maintaining the continuity of production of sugar , for avoiding undue hardship to cane producing farmers and to best sub- serve the interests of all sections of the people, it is expedient in the public interest to provide for the taking over for a limited period the management of every sugar undertaking which falls or ceases to manu- facture sugar or which fails to pay promptly amounts due for the cane acquired for the purposes of the undertaking ;
BE it enacted by Parliament in the Twenty- ninth Year of the Republic of India as follows : ---
CHAPTER I
PRELIMINARY
1. (1 ) This Act may be called the Sugar Undertakings ( Taking Over of Management ) Act, 1978.
Short title , extent and commence- ment.
(2) It extends to the whole of India.
(3) It shall be deemed to have come into force on the 9th day of November, 1978.
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1380
2.In this Act, unless the context otherwise requires ,-
Defini- tions .
(a) " appointed day " , in relation to any sugar year, means such day in the year as the Central Government may , by notification, specify having regard to the agro - climatic conditions prevailing or likely to prevail , the quantity of cane available or likely to be availa- ble for crushing and other relevant factors:
Provided that for the sugar year 1978-79 , the appointed day shall be the 15th day of November , 1978;
(b) " cane" means sugarcane ;
(c) " date of vesting ", in relation to a sugar undertaking, means the date on which the management of the undertaking vests in the Central Government under section 3;
(d) " notification" means a notification published in the Official Gazette;
Act; (e) " prescribed " means prescribed by rules made under this
(f) " sugar undertaking" means an undertaking engaged in the manufacture or production of sugar by means of vacuum pans and with the aid of mechanical power and " notified sugar undertaking" means a sugar undertaking in respect of which a notification has been issued under section 3 ;
(g) " sugar year" means the period of twelve months commenc- ing on the 1st day of October and ending with the 30th day of September next following;
65 of 1951 .
(h) words and expressions used but not defined in this Act and defined in the Industries (Development and Regulation) Act, 1951 shall have the meanings respectively assigned to them in that Act and for this purpose a sugar undertaking shall be deemed to be an industrial undertaking within the meaning of that Act ;
65 of 1951 . 1 of 1956 .
(i) words and expressions used but not defined in this Act or in the Industries (Development and Regulation) Act, 1951 but defined in the Companies Act, 1956 shall have the meanings respec- tively assigned to them in the Companies Act, 1956.
CHAPTER II
TAKING OVER OF MANAGEMENT
3. (1 ) Where the Central Government is satisfied-
(a) that any sugar undertaking has in any sugar year failed to commence the manufacture of sugar on or before the appointed day in respect of that year, or having started the manufacture of sugar on or before that day ceased to manufacture sugar before the expiry of the average period of manufacture of sugar in relation to that undertaking ; or
Vesting of manage- ment of asugar under- taking in Central Govern- ment .
(b) that on any date in any sugar year any sugar undertaking has, in relation to the cane purchased before that date for the pur- poses of the undertaking , arrears of cane dues to the extent of more SEC . 2 ]
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than ten per cent, of the total price of the cane purchased for the pur- poses of the undertaking during the immediately preceding sugar year; and
(c) that in either case the effective functioning of the under- taking is necessary for the purposes of this Act ,
the Central Government may issue a notice in such form and in such manner as may be prescribed to the owner or the manager of such sugar undertaking calling upon such owner or manager to report in writing within such time , not being less than five days , as may be specified in the notice, the circumstances under which such undertaking has so failed to commence or ceased to manufacture sugar or , as the case may be , clear the said arrears of cane dues and to show cause as to why the management of such undertaking should not be taken over by the Central Government under this Act .
(2) As soon as may be , after the receipt of the report under sub- section ( 1 ) from the sugar undertaking , or where the sugar undertaking has failed to make such report within the time specified in the notice to that undertaking under sub- section (1 ) , after the expiry of such time, the Central Government may make such further inquiry ( if any) as it may deem fit , and-
(a) if the Central Government is satisfied that having regard to all the circumstances of the case and the purposes of this Act that it would be expedient to give further time to the undertaking to enable it to commence or resume production of sugar or , as the case may be , clear the arrears of cane dues , it may, by order in writing , specify the date on or before which and the manner in which such undertaking shall commence or resume production of sugar or, as the case may be , clear the said arrears of cane dues ; or
(b) if the Central Government is not satisfied as provided in clause (a ) , declare by notification that the management of such undertaking shall vest in the Central Government on and from such date as may be specified in such notification.
(3) If a sugar undertaking has failed to comply with an order made under clause ( a) of sub - section ( 2 ) , or having commenced or resumed the production of sugar on or before the date specified in such order, ceased to manufacture sugar before the expiry of the average period of manufacture of sugar in relation to that undertaking , and the Central Government is satisfied that it is necessary so to do for the purposes of this Act , it may, by notification, declare that the management of such sugar undertaking shall vest in the Central Government on and from such date as may be specified in such notification.
(4) Any failure on the part of the owner or manager of the sugar undertaking to utilise the undertaking for the manufacture of sugar during any period shall not be taken into account for the purpose of issuing a notification in respect of that undertaking under clause ( ৮) of sub - section ( 2) or sub -section ( 3) where such failure is attributable to any circumstances (other than financial difficulties) beyond his con- trol.
(5) Every notification issued under sub -section ( 2) or sub - section (3) for vesting the management of a sugar undertaking in the Central [PART II-
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Government shall be in force for such period not exceeding three years from the date of vesting as may be specified in the notification but if the period so specified is less than three years from the date of vesting and the Central Government is of opinion that it is expedient in the public interest that the management of the sugar undertaking should continue to vest in the Central Government after the expiry of the period so specified , it may, from time to time, issue, by notification, directions for such continuance for such further period as may be speci- fied in the directions:
Provided that the total period for which the management of the undertaking may remain vested in the Central Government shall in no case exceed three years from the date of vesting .
(6) For the purposes of this section-
(a) " cane dues" , in relation to any cane purchased by a sugar undertaking , means the price payable in accordance with the agreement (whether express or implied) or arrangement relating to such purchase and where there is no such agreement or arrange- ment, the price as determined in accordance with the law applicable to such purchase;
(b) any cane dues being the price payable for any cane acquired for the purposes of a sugar undertaking shall not be deemed to be in arrears at any time before the expiry of fourteen days from the date of delivery of such cane to the undertaking;
(c) the average period of manufacture of sugar in relation to any sugar undertaking with respect to any sugar year (hereafter in this clause referredto as the current sugar year) shall be calcu- lated by dividing the total number of calendar days during which the undertaking manufactured sugar during the period of three sugar years immediately preceding the current sugar year by the number of sugar years in which the undertaking manufactured sugar during the said period of three years .
Assets, etc., of notified sugar under- taking.
4. (1) The notified sugar undertaking shall be deemed to include all assets , rights, powers , authorities and privileges , in relation to the said undertaking and all property , movable and immovable, including lands, buildings , workshops , stores , instruments , machinery , automobiles and other vehicles and goods under production or in transit , cash balances , reserve funds , investments and all other rights and interests in, or arising out of, such property as were, immediately before the date of vesting, in the ownership , possession , power or control of that undertaking, whether within or outside India, and all books of account , registers and all other documents of whatever nature relating thereto .
(2) Any contract , whether express or implied , or other arrangement (whether under any statute or otherwise) in so far as it relates to the management of the business and affairs of the notified sugar under- taking, and in force immediately before the date of vesting , order made by any Court in so far as it relates to the management of the business and affairs of that undertaking and in force immediately before the said date, shall be deemed to have terminated on that date . or any SEC . 2 ]
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(3) All persons in whom the management of the business and affairs of the notified sugar undertaking vests immediately before the date of vesting shall , as from that date , cease to be so vested.
(4) Notwithstanding any judgment, decree or order of any Court , tri- bunal or other authority or anything contained in any law ( other than this Act ) for the time being in force , every Receiver , Official Liquidator or other person in whose possession or custody or under whose control the notified sugar undertaking or any part thereof may be immediately before the date of vesting , shall , on that date , deliver the possession of the said undertaking or such part thereof, as the case may be, to the Custo- dian, appointed under section 5, or , where no Custodian has been appoint- ed, to such other person as the Central Government may direct .
(5) The Central Government may take, or cause to be taken , all necessary steps for securing the possession of the notified sugar undertaking.
Appoint- ment of Custodian.
5. ( 1) The Central Government may , as soon as it is convenient admi- nistratively so to do , appoint an individual or a body of individuals or a Government company as the Custodian of a notified sugar undertaking or a group of notified sugar undertakings for the purpose of taking over the management of such undertaking or undertakings and the Custodian so appointed shall carry on the management of such undertaking or undertakings for and on behalf of the Central Government .
(2) The Central Government may also appoint an individual or a Government company as the Custodian- General for exercising supervi- sion and control over all the notified sugar undertakings , and on such appointment , every Custodian appointed under sub - section ( 1 ) shall act under the guidance, control and supervision of the Custodian - General .
(3 ) On the appointment of a Custodian under sub -section (1 ) , the charge of management of the notified sugar undertaking or group of noti- fied sugar undertakings , as the case may be, shall vest in such Custodian and all persons in charge of the management of such undertaking or undertakings immediately before such appointment shall cease to be in charge of such management and shall be bound to deliver to the Custo- dian all assets , books of account , registers or other documents in their custody relating to such undertaking or group of undertakings .
(4) The Central Government may issue such directions ( including directions as to initiating , defending or continuing any legal proceedings before any Court , tribunal or other authority ) to the Custodian or Custo- dian- General as to his or its powerswers and duties as the Central Govern- ment deems desirable and the Custodian- General or, if there is no Custo- dian-General, the Custodian may apply to the Central Government at any time for instructions as to the manner in which the Custodian or the Custodian-General shall conduct the management of the notified sugar undertaking or in relation to any matter arising in the course of such management .
(5) Any person , who , on the appointed day, has in his possession or under his control any books , papers or other documents relating to the notified sugar undertaking , shall , notwithstanding anything contained in any other law for the time being in force , be liable , to account for the books , papers and other documents , to the Custodian and shall deliver THE GAMETTE OF INDIA EXTRAORDINARY
[PART II- 1384
them up to the Custodian or to such other person as may be authorised by the Central Government or the Custodian in this behalf .
(6) Every person in charge of the management of the notified sugar undertaking, immediately before the date of vesting, shall , within ten days from that date or within such further period as the Central Govern- ment may allow in this behalf, furnish to the Custodian a complete inventory of all the properties and assets ( including particulars of book debts, investments and belongings ) forming part of the undertaking immediately before the date of vesting and of all liabilities and obliga- tions of the undertaking subsisting immediately before that date and also of all agreements entered into by the owner or manager of the undertaking , in relation to the said undertaking, and in force immediately before that date .
(7) The Custodian - General shall hold office during the pleasure of tho Central Government and shall receive such remuneration as may be fixed by the Central Government .
(8) Every Custodian or where a body of individuals has been appoint- ed as the Custodian , each such individual shall hold office during the pleasure of the Central Government and shall receive from the funds of the sugar undertaking or group of sugar undertakings concerned , such remuneration as may be fixed by the Central Government .
Explanation . The remuneration payable to the Custodian of two or more notified undertakings shall be allocated among the funds of the undertakings in such proportion as the Central Government may, having regard to the quantum of work in respect of such undertakings and other relevant circumstances , by order determine .
Pay- ment of amount .
6. (1 ) The owner of every notified sugar undertaking shall be given by the Central Government an amount in cash for vesting in it under section 3 the management of such undertaking .
(2) For every month during which the management of the notified sugar undertaking remains vested in the Central Government under this Act, the amount , referred to in sub - section ( 1 ) , shall be ,-
(a) where the daily cane crushing capacity of the undertaking is five hundred tonnes or less , an amount of five hundred rupees ; and
(b) where the daily cane crushing capacity of the undertaking is more than five hundred tonnes , an amount computed at the rate of one rupee for each tonne of such capacity or an amount of one thousand two hundred and fifty rupees , whichever is less .
CHAPTER III
RELIEF TO SUGAR UNDERTAKINGS AND CANE PRODUCING FARMERS
7. (1 ) The Central Government may , if it is satisfied , in relation to a notified sugar undertaking that it is necessary so to do in the interests of the general public with a view to preventing the fall in the volume of production of the sugar industry , it may , by notification, declare that- Powerof Central Govern- ment to make cer- tain de- clara- tions.
(a) all or any of the enactments specifled in the Schedule shall not apply or shall apply with such adaptations , whether by way of SEC . 2]
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modification , addition or omission ( which does not, however , affect the policy of the said enactments ) to such sugar undertaking , as may be specified in such notification, or
(b) the operation of all or any of the contracts , assurances of property , agreements , settlements , awards , standing orders or other instruments in force ( to which such sugar undertaking or the person owning such undertaking is a party or which may be applicable to such sugar undertaking or person) immediately before the date of issue of the notification shall remain suspended or that all or any of the rights , privileges , obligations and liabilities accruing or arising thereunder before the said date , shall remain suspended or shall be enforceable with such adaptations and in such manner as may be specified in the notification .
(2) The notification made under sub - section ( 1 ) in relation to a notifi- ed sugar undertaking shall remain in force , in the first instance , for such period not exceeding one year as may be specified in the notification but the duration of such notification may be extended from time to time by a further notification by a period not exceeding one year at a time .
(3) Any notification made under sub - section (1) shall have effect not- withstanding anything to the contrary contained in any other law, agreement, or instrument or any decree or order of a Court , tribunal , officer or other authority or of any submission, settlement or standing order.
(4) Any remedy for the enforcement of any right, privilege, obligation or liability referred to in clause ( b ) of sub -section ( 1) and suspended or modified by a notification made under that sub - section shall , in accordance with the terms of the notification , remain suspended or modified and all proceedings relating thereto pending before any Court, tribunal, officer or other authority shall accordingly remain stayed or be continued sub- ject to such adaptations , so , however, that on the notification ceasing to have effect-
(a) any right , privilege , obligation or liability so remaining sus- pended or modified shall become revived and enforceable as if the notification had never been made;
(b) any proceeding so remaining stayed shall be proceeded with subject to the provisions of any law which may then be in force, from the stage which had been reached when the proceedings become stayed.
(5) In computing the period of limitation for the enforcement of any right , privilege, obligation or liability referred to in clause (b ) of sub- section ( 1 ) , the period during which it or the remedy for the enforce- ment thereof remained suspended shall be excluded.
8. ( 1 ) The Central Government may issue such directions as it deems Assis- fit to the Custodian -General and the Custodians to facilitate the speedy clearance of arrears of cane dues so as to avoid undue hardship to cane producing farmers .
tance to notified sugar un- dertakings to clear arrears of cane dues .
(2) Without prejudice to the provisions of sub- section (1 ) , the Cen- tral Government may render such assistance in such manner as it may THE GAZETTE OF INDIA EXTRAORDINARY [Paar İl- 1386
deem fit to any notified sugar undertaking to enable the undertaking to clear the whole or any part of its arrears of cane dues so as to avoid undue hardship to cane producing farmers .
Explanation. For the purposes of this section, the expression "arrears of cane dues " shall be construed in accordance with the pro- visions of clauses ( a) and ( b) of sub -section (6) of section 3.
CHAPTER IV
MISCELLANEOUS
9. (1) No proceeding for the winding up of a notified sugar undertak- ing , being a company , shall lie in any Court or be continued whether by or under the supervision of any Court or voluntarily , except with the consent of the Central Government .
Notified sugarun- dertaking, if a com- pany , not to be wound up .
(2) In computing the period of limitation prescribed by any law for the time being in force for any application which may be made in the course of winding up of any such notified sugar undertaking in respect of any matter arising out of any transaction in relation to such under- taking, the time during which the making of such application was barred by this Act shall be excluded.
Con- tracts etc. , inbad faith may becancel- led or varied .
10. (1 ) If the Central Government is satisfied, after such inquiry as it may think fit , that any contract or agreement entered into by the owner or manager of a notified sugar undertaking, in relation to the said undertaking , at any time within twelve months immediately preceding the date of vesting, has been entered into in bad faith or is detrimental to the interests of the undertaking, it may make an order cancelling or varying ( either unconditionally or subject to such conditions as it may think fit to impose) the contract or agreement and thereafter the con- tract or agreement shall have effect accordingly:
Provided that no contract or agreement shall be cancelled or varied except after giving to the parties to the contract or agreement a reason- able opportunity of being heard .
(2) Any person aggrieved by an order made under sub- section (1 ) may make an application to the principal Court of civil jurisdiction within the local limits of whose jurisdiction the registered office of the sugar undertaking is situated for the variation or reversal of such order and, thereupon such Court may confirm , vary or reverse such order .
Powerto terminate thecon- tract of employ- ment.
11. If the Custodian or Custodian- General is of opinion that any contract of employment entered into by any owner or member of a notified sugar undertaking or its agent in relation to the said under- taking, at any time before the date of vesting, is unduly onerous , he may , by giving to the employee one month's notice in writing or the salary or wages for one month in lieu thereof, terminate such contract of employment.
12. (1) Pending the taking over by a Custodian , appointed under section 5, of the physical possession of any notified sugar undertaking, the person in charge of the management of such undertaking imme- diately before the date of vesting shall, on and from that date , be in Manage- ment of notified sugar un- dertak- ings.
SEC. 2 ]
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pending taking over phy . sical pos- sessionby theCus- todian, charge of the management of such undertaking for and on behalf of the Central Government ; and the management of such undertaking shall be carried on by such person subject to the provisions contained in sub - section (2) and such directions , if any, as the Central Government may give to him , and no other person , including the said undertaking shall , so long as such management continues , exercise any powers of management in relation to the said undertaking .
(2) No person in charge , under sub -section ( 1 ) , of a notified sugar undertaking shall, without the previous approval of the Custodian- General appointed under section 5,-
(i) incur any expenditure from the assets appertaining to the undertaking otherwise than for the purpose of making routine pay- ments of salaries or commissions to employees , agents or for the purpose of meeting the routine day to day expenditure ;
( ii) transfer or otherwise dispose of any such assets or create any charge , hypothecation, lien or other incumbrance thereon;
(iii) invest in any manner any moneys forming part of such assets;
(iv ) acquire any immovable property out of the moneys form- ing part of such assets ;
(v) enter into any contract of service or agency , whether ex- pressly or by implication , for purposes connected wholly or partly with the undertaking or vary the terms and conditions of any contract relating to any such transaction subsisting on the date of vesting.
(3) The approval of the Custodian- General may be given either generally in relation to certain classes of transactions relating to the notified sugar undertaking or specially in relation to any of its transac- tions .
13. ( 1 ) No suit , prosecution or other legal proceeding shall lie against the Government , the Custodian-General or any other officer of Govern- ment or any Custodian in respect of anything which is in good faith done or intended to be done under this Act ,
Protec- tion of action taken in good faith.
(2) No suit or other legal proceeding shall lie against the Govern- ment , the Custodian -General or any other officer of Government or any Custodian for any damage caused, or likely to be caused , by anything which is in good faith done or intended to be done under this Act .
Delega- tion of powers , 14. (1) The Central Government may , by notification , direct that all or any of the powers exercisable by it under this Act , other than those under this section or section 8 or section 20 may also be exercised by any person or persons as may be specified in the notification.
(2) Whenever any delegation of power is made under sub -section (1), the person to whom such power has been delegated shall act under the direction, control and supervision of the Central Government, [PART II-
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15. Every debt arising out of any loan advanced to a notified sugar undertaking by the Central Government or a State Government for carrying on the management of such undertaking-
(a) shall have priority over all other debts , whether secured or unsecured , incurred before the management of such undertaking was taken over under this Act ;
Debts in- curred for thepur- poses of notified sugar un- dertakings to have priority.
1 of 1956.
(b) shall be a preferential debt within the meaning of section 530 of the Companies Act , 1956,
and such debts shall rank equally among themselves and be paid in full out of the assets of the undertaking unless such assets are insufficient to meet them, in which case they shall abate in equal proportions .
Penalties .
16. If any person
(a) fails to deliver to the Custodian any assets , books of account , registers or any other documents in his custody relating to any notified sugar undertaking, or
(b) retains any property of such undertaking or removes or destroys it , or
(c) fails to comply with the provisions of section 5, or
(d) failsto comply with any direction made under this Act ,
he shall be punishable with imprisonment for a term which may extend to seven years , and shall also be liable to fine .
Offences by com- panies
17. (1) Where an offence under this Act has been committed by a company, every person who , at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company as well as the company , shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:
Provided that nothing contained in this sub- section shall render any such person liable to any punishment, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub - section ( 1 ) , where any offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or conniv- ance of, or is attributable to , any neglect on the part of any director , manager , secretary or other officer of the company , such director, manager , secretary or other officer shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation . For the purposes of this section.
(a) " company" means any body corporate and includes a firm or other association of individuals ; and
(b) "director" , in relation to a firm, means a partner in the firm.
SEC. 21
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Act not toapply to certain sugar un- dertakings .
1 of 1956 .
18. (1 ) The provisions of this Act shall not apply to any sugar under- taking which is owned by or is under the management of the Central Government or a State Government or a corporation established by or under an enactment ( including an Ordinance) or a Government company as defined in section 617 of the Companies Act , 1956 .
(2) For the purposes of sub - section (1 ) , the management of a sugar undertaking by a receiver or an authorised controller appointed by the Central Government or a State Government under any law for the time being in force shall also be deemed to be management of the undertak- ing by the Central Government or a State Government , as the case may be.
Actto have over- riding effect.
19. The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any law ( other than this Act) or any judgment, decree or order of any Court , tribunal or other authority or any instrument having effect by virtue of any law other than this Act .
20. The Central Government may , by notification , make rules to carry out the provisions of this Act.
Power to make rules .
Laying of rules and certain notifica- tions.
21. Every rule made by the Central Government under this Act and every notification made under section 7 shall be laid , as soon as may be after it is made, before each House of Parliament, while it is in session , for a total period of thirty days which may be comprised in one session or in two or more successive sessions , and if, before the expiry of the session immediately following the session or the succes- sive sessions aforesaid , both Houses agree in making any modification in the rule or notification or both Houses agree that the rule or notifica- tion should not be made, the rule or notification shall thereafter have effect only in such modified form or be of no effect, as the case may be; so , however , that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or notification .
22. ( 1) The Sugar Undertakings ( Taking Over of Management ) Ordi- nance, 1978, is hereby repealed .
5 of 1978 ,
Repeal and saving.
(2) Notwithstanding such repeal , anything done or any action taken under the Ordinance so repealed shall be deemed to have been done or taken under the corresponding provisions of this Act .
THE SCHEDULE
(See section 7)
1. The Industrial Employment (Standing Orders) Act, 1946.
20 of 1946 .
2. The Industrial Disputes Act , 1947 .
14 of 1947.
3. The Minimum Wages Act, 1948 .
11 of 1948:
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[PART II- 1390
STATEMENT OF OBJECTS AND REASONS
Sugar production during 1977-78 season had reached a record level of about 65 lakh tonnes . Taking into account the record sugar produc- tion and the high level of sugar stock in the system, the need to further maximise domestic consumption of sugar and other factors , the Gov- crnment had removed controls on prices , distribution, etc. , of sugar from the 16th August , 1978. The open market prices of sugar through- out the country have come down and are ruling at reasonable levels.
There had, however, been a disquieting increase in the arrears due to sugarcane growers , despite the efforts of the Government to liberalise the availability and terms of bank credit. The arrears of cane price for 1977-78 sugar season , as at the beginning of the current 1978-79 season, that is , on the 1st October , 1978, amounted to over Rs . 53 crores . There was also an apprehension that on one pretext or the other a considerable number of sugar undertakings might not commence pro- duction during the current 1978-79 season on time . In the interests of the consuming public and sugarcane growers and to maintain pro- duction and availability of sugar, which is an essential commodity, it became necessary to make provision for the taking over by the Govern- ment of the management of the defaulting sugar undertakings for a specified period.
In view of the urgency, and as Parliament was not in session, the Sugar Undertakings (Taking Over of Management ) Ordinance , 1978 (5 of 1978) was promulgated on the 9th November, 1978 to achieve the above objects.
The Bill seeks to replace the provisions of the Ordinance .
NEW DELHI;
B. P. SINGH .
The 19th November, 1978 .
PRESIDENT'S RECOMMENDATION UNDER ARTICLE 117 OF THE CONSTITUTION OF INDIA
[Copy of letter No. 425 - M (ABI) / 78- D , dated the 22nd November, 1978 from Shri Surjit Singh Barnala, Minister of Agriculture and Irrigation to the Secretary , Lok Sabha . ]
The President, having been informed of the subject matter of the pro- posed Bill recommends the consideration of the Bill under article 117 (3) of the Constitution.
SEC. 2]
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FINANCIAL MEMORANDUM
The Bill , if enacted, would necessitate expenditure on account of payment to the personnel to be employed to administer the Act and to exercise superintendence and control over the Custodians , payment of amounts to the owners of sugar undertakings for vesting their manage- ment in the Central Government and for providing financial assistance to such undertakings to clear the arrears of sugarcane dues ,
to be provided supporting set-up regional offices for units. Their salaries and Under sub -clause (2) and ( 7) of clause 5 of the Bill , a Custodian- General may be appointed . He may have staff and it may be necessary for him to smooth and efficient control of taken-over allowances as also other office expenditure would entail an annual ext penditure of about Rs . 7 lakhs in the first year of operation of the legislation. In the subsequent years , there may be a decrease or increase in the expenditure on this account and the same would depend upon , inter alia, the number of units the management whereof is for the time being vested in the Central Government .
Although information about sugarcane dues of individual mills has been collected and a number of sugar undertakings has sugarcane dues in excess of 10 per cent . of the price payable for the cane purchased during 1977-78 , it is by no means an indication that the management of all such undertakings shall have to be taken over. The reasons for such dues are to be adjudged objectively . It is , therefore , not possible at this juncture to have a precise idea of the actual number of sugar undertak- ings whose management may have to be taken over and therefore of the requirement of funds . It is, however , estimated that the take- over of the management of a sugar undertaking will involve non - recurring ex- penditure by way of loan assistance of the order of Rs . 50-60 lakhs towards sugarcane dues and Rs . 30-35 lakhs by way of working capital in terms of sub clause (2 ) of clause (8) of the Bill and a recurring expenditure of Rs . 6,000 to 15,000 towards payment to the owner of the sugar under taking in terms of clause 6 of the Bill . The payments under the said clause 6 will have to be made only for the period during which the management of the sugar undertaking remains vested in the Central Government .
The Bill , if enacted, is not likely to involve any other recurring or non-recurring expenditure .
THE GAZETTE OF INDIA EXTRAORDINARY
[PART II-
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MEMORANDUM REGARDING DELEGATED LEGISLATION
Clause 20 of the Bill empowers the Central Government to make rules for carrying out the provisions of the proposed legislation. Clause 3 provides for the issue of a notice under certain circumstances to the owner or manager of a sugar undertaking . The form in which such notice may be issued may be prescribed by rules . Similarly, the manner in which such notice will be served on such owner or manager may have to be prescribed by rules. All these matters are of a procedural character. Moreover , the rules made under clause 20 will have to be laid before each House of Parliament and they will be subject to the scrutiny of Parliament .
The delegation of legislative power is, therefore , of a normal character .
THE GAZETTE OF INDIA EXTRAORDINARY
SEC. 21
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Memorandum explaining the modifications contained in the Bill to replace the Sugar Undertakings ( Taking Over of Management )
Ordinance , 1978
Apart from changes of a formal and drafting nature, sub-section ( 1 ) of section10 of the Ordinance has been modified to provide that the Cen- tral Government will have the option of cancelling or varying a contract or agreement entered into by the owner or manager of a notified sugar undertaking in relation to the said undertaking either on the ground that such contract or agreement has been entered into in bad faith or on the ground that such contract or agreement is detrimental to the interests of the undertaking .
AVTAR SINGH RIKHY ,
Secretary.
PRINTED BY THE GENERAL MANAGER, GOVERNMETN OF INDIA PRESS , MINTO ROAD , NEW DELHI AND PUBLISHED BY THE CONTROLLER OF PUBLICATIONS, DELHI , 1978