LexThe TAMIL NADU SUGARCANE (REGULATION OF PURCHASE PRICE) ACT, 2018
Tamil Nadu · state statute
Open in Lexace · Ask the AI about this actTHE TAMIL NADU SUGARCANE (REGULATION OF
PURCHSE PRICE) ACT, 2018
The following Act of the Tamil Nadu Legislative Assembly received the assent of the
Governor on the 12th July 2018 and is hereby published for general information
ACT No. 23 OF 2018.
An Act to regulate the price of sugarcane purchased by the sugar
factories from the farmers in the State of Tamil Nadu.
WHEREAS it is expedient to regulate the price of sugarcane purchased by sugar
factories from the farmers in the State of Tamil Nadu, to offer better realization of
price for the sugarcane sold by the farmers to the factory of the reserved area and to
provide for matters connected therewith or incidental thereto.
BE it enacted by the Legislative Assembly of the State of Tamil Nadu i n the Sixty-
ninth Year of the Republic of India as follows:—
1. (1) This Act may be called the Tamil Nadu Sugarcane (Regulation of Purchase
Price) Act, 2018.
(2) It shall come into force on such date as the State Government may, by
notification, appoint.
2. (1) In this Act, unless the context otherwise requires,—
(a) “audit committee” means the committee appointed by the Board under
section 13;
(b) “bagasse” means the final fibrous residue from a milling train or from the
dewatering mills of diffusion plant;
(c) “Board” means the Sugarcane Control Board constituted under section 3;
(d) “Commissioner’’ means the Commissioner of Sugar and Cane Commissioner
or any officer designated in this capacity by the Government;
(e) “factory” means any premises including the precincts thereof in any part of
which sugar is manufactured by vacuum pan process and at its own option, ethanol
either directly from su garcane juice or from molasses, including B -Heavy molasses, or
both, as the case may be, is manufactured;
(f) “Fair and Remunerative Price” means the minimum price fixed for sugarcane
by Central Government under clause 3 of the Sugarcane (Control) Order, 1966 for the
sugarcane year;
(g) “Financial Year” means the year commencing on the first day of April and
ending with the thirty first day of March in the succeeding year;
(h) “free will area” means area not covered under the reserved area;
(i) “Government” means the State Government;
Short title and
commencement
Definitions
(j) “molasses” means mother liquid left over after recovery of sugar in the final
stage of manufacturing by the vacuum pan process;
(k) “occupier of factory ” means the person, who has control over all the affairs
of a sugar factory and where t he said affairs are entrusted to a director, partner or
administrator, such director, partner or administrator, as the case may be;
(l) “person” includes individual, a co-operative society, Hindu Undivided Family,
a company or firm or an association or a body of individuals, whether incorporated or not;
(m) “prescribed” means prescribed by rules;
(n) “reserved area” means, any area where sugarcane is grown and reserved for
a factory under sub-clause (1) (a) of clause 6 of the Sugarcane (Control) Order, 1966;
(o) “revenue sharing based sugarcane price” means the price of sugarcane
arrived at for each factory separately in accordance with section 9 of this Act and this
price when realised shall be equal to or over and above the Fair and Remunerative Price
for the respective season;
(p) “State” means the State of Tamil Nadu;
(q) “sugarcane” means sugarcane intended for use in a factory;
(r) “sugarcane grower” means a person who cultivates sugarcane intended for
sale to a factory whether by himself or by his servants or by hired labour or by members
of his family or his tenants, and includes a Co -operative Society registered under the
Tamil Nadu Co-operative Societies Act, 1983;
(2) Words and expressions used but not defined in this Act shall have meanings
assigned to them in the Sugarcane (Control) Order, 1966.
3. (1) The Government shall, by notification, constitute a Board to be called as the
Sugarcane Control Board to exercise such powers and to perform such functions
assigned to it under this Act.
(2) The Board shall have perpetual succession and have a common seal and shall, by
the said name, sue and be sued.
(3) The Board shall consist of the following members, namely:—
(a) Chief Secretary to Government, who shall be the Chairperson, ex-
officio;
(b) Secretary to Government, Finance department, ex-officio;
(c) Secretary to Government, Industries department, ex-officio;
(d) Agricultural Production Commissioner and Secretary to Government,
Agriculture Department, ex-officio;
(e) Director of Agriculture, ex-officio;
(f) Director, Sugarcane Breeding Institute, Coimbatore, ex-officio;
(g) Chief Accounts Officer, Tamil Nadu Sugar Corporation, ex-officio;
(h) three representatives of the factories in the State to be nominated by
the Government, out of which,—
Constitution of
Sugarcane
Cotton Board
Tamil Nadu Act
30 of 1983.
(i) one member shall be from Tamil Nadu Co-operative Sugar
Federation; and
(ii) two members from private sugar factories in the State;
(i) four representatives of sugarcane growers cultivating sugarcane
regularly in the State and supplying sugarcane to the factories, to be
nominated by the Government, out of which,—
(i) two members shall be sugarcane growers supplying
sugarcane to co-operative or public sector sugar factories; and
(ii) two members shall be growers supplying sugarcane to private
sugar factories in the State;
(j) Commissioner, Member Secretary, ex-officio;
(4) The headquarters of the Board shall be at Chennai.
4. (1) A n ominated member shall hold offi ce for a period of two years from the
date of his nomination and he is eligible for re-nomination:
Provided that a nominated member s hall not be re -nominated to the Board,
without completion of a cooling off period of two years between the two terms.
(2) A nominated member may, by writing under his hand addressed to the
Government, resign his offi ce, but he sha ll continue to hold office until his resignation is
accepted by the Government.
(3) When the offi ce of a nom inated member becomes vacant by resignation,
death, removal, disqualification or otherwise, the Government shall nominate within three
months a new member to fill such vacancy.
(4) The Government may remove a nominated member from his office, if he
incurs any one of the disqualifications specified below, namely:—
(a) becomes an un-discharged insolvent; or
(b) is convicted and sentenced to imprisonment for an offence which, in the
opinion of the Government, involves moral turpitude; or
(c) becomes of unsound mind and stands so declared by a competent court.
(5) The nominated members shall be eligible to draw such rate of sitting fee and
travelling allowance, as may be prescribed.
5. (1) The Board shall meet, as often as may be necessary, at such time and
place and observe such rules of procedure as may be prescribed:
Provided that the Board shall meet at least twice in a year.
(2) The Chairperson shall preside over the meeting of the Board.
(3) In the absence of the Chairperson by reason of leave or illness or for any
other reasons, the Chairperson may authorise any of the other members of the Board to
function as Chairperson and he shall preside over the meeting.
(4) No act or proceeding of the Board shall be invalid by reason only of the
existence of any vacancy in, or any defect in the constitution of, the Board.
Terms and
conditions of
appointment
of nominated
members of
the Board.
Meetings of the
Board.
(5) Notice of the meetings of the Board, the place, quorum and procedures
regarding transactions of the business of the Board shall be such as may be prescribed.
6. The Board shall discharge the following functions, namely:—
(a) decide the revenue sharing based sugarcane price payable to the sugarcane
growers, by the concerned sugar factories;
(b) offer advice on any matter referred by the Government, especially in respect
of the regulation of the purchase of sugarcane;
(c) bring to the notice of the Commissioner, cases of breach of any of the
provisions of the Act and the rules made thereunder, and to make suggestions for the
prevention of the same;
(d) inquire into any matter in discharge of its functions including matters relating
to revenue and expenditure, books of accounts of the factory, etc.,;
(e) consider the report of the audit committee on the revenue realisation for
determination of revenue sharing ba sed sugarcane price; and confer on it any powers as
it deems fi t;
(f) nominate any offi cer or committee to look into specific issues pertaining to the
implementation of the provisions of the Act; and
(g) perform such other functions as may be prescribed.
7. (1) The Board shall, for the purpose of any inquiry, have all the powers of a
civil court while trying a civil suit under the Code of Civil Procedure, 1908 and, in
particular, in respect of the following matters, namely:—
(a) summoning and enforcing t he attendance of any person and examining him
on oath;
(b) requiring the discovery and production of any document;
(c) receiving evidence on affidavits;
(d) requisitioning any public record, or copy thereof from any cou rt or offi ce or
factory;
(e) issuing summons for the examination of witnesses and documents;
(f) to enquir e into a complaint regarding fi xation of revenue sharing based
sugarcane price;
(g) any other matter as may be prescribed.
(2) Whe re the Board fi nds after enquir y that the allegation contained in any
complaint is without any substance, it may, by an order, direct the complainant to pay to
the opposite party an amount specified in the order by way of cost.
(3) Where the allegation con tained in any complaint is about the loss to the
sugarcane grower, the Board may, during enquiry, collect evidence, determine the loss
and direct in its order, the amount to be realised from the person responsible.
(4) If the amount payable under sub -section (2) or sub -section (3) is not paid
within the period specifi ed in the order, the same shall be recovered as if it were an
arrear of land revenue under the Tamil Nadu Revenue Recovery Act, 1864.
8. On receipt of the recommendations of the Board, the Government may, by
notification, declare the revenue sharing sugarcane price payable to the sugarcane
growers by the concerned sugar factories.
Functions of the
Board.
Central Act V of
1908.
Powers of the
Board.
Tamil Nadu Act II
of 1864.
Power of the
Government to
declare revenue
sharing based
sugarcane price.
9. (1) The revenue sharing based sugarcane price shall be the higher value
among the following, namely:—
(i) the sugarcane price arrived at as a sum equal to seventy per cent of the
ex-factory basic value of sugar and the primary by -products such as bagasse, molasses
and press mud; or
(ii) the sugarcane price arrived at as a sum equal to seventy fi ve per cent of
the ex-factory basic value of sugar alone.
(2) Upon declaration of the revenue sharing based sugarcane price by the
Government, the cane grower is eligible to receive the difference between the revenue
sharing based sugarcane price and the Fair and Remunerative Price as additional price
in addition to the full Fair and Remunerative P rice for the cane purchased from the cane
grower in the reserved area of the factory for the financial year under consideration.
10. The Government may, on the recommendation of the Board, declare any
variety of sugarcane as an unsuitable variety, and no factory shall grow or purchase such
sugarcane variety as so declared.
11. The occupier of a fact ory or any other person acting on his behalf, shall not
distribute to any sugarcane grower in any area or shall not plant sugarcane seed of any
variety in his own factory area if the same has been declared by the Government as
unsuitable under section 10.
12. (1) A sugarcane grower shall sell sugarcane only to the factory to which the
area has been reserved. The sugarcane grower in a free will area is at liberty to choose
the factory of his choice, but if he has entered into an agreement with a factory, the
sugarcane shall be sold to that factory only.
(2) The factory shall enter into an agreement with the sugarcane grower in such
form, by such date on such terms and condi tions as specifi ed in clause 6 of the
Sugarcane (Control) Order, 1966 for the purpose of purchasing the sugarcane offered in
accordance with sub-clause (1) of clause 6 of the said Order.
(3) No person other than the factory aforementioned shall purchase or enter into
an agreement to purchase sugarcane grown by the sugarcane grower except in
accordance with the agreement made under sub-section (1).
13. (1) For ascertaining revenue realisation in a sugar factory and to advise the
Board on the determination of revenue sharing based sugarcane price, there shall be an
audit committee appointed by the Board consisting of,—
(a) Commissioner – Chairman;
(b) Managing Director, Tamil Nadu Co-operative Sugar Federation – Convenor;
(c) Director, Co-operative Audit – Member;
(d) Chief Accounts Officer, Tamil Nadu Sugar Corporation – Member;
(e) Chief Sugar Chemist, Tamil Nadu Sugar Corporation – Member;
(f) An Independent Auditor (to be nominated by the Chairperson
of the Board) – Member;
The Board or the Chairman of the audit committee with the permission of the Board may
appoint technical experts to the audit committee as and when required.
Calculation of
revenue sharing
based sugarcane
price and
payment.
Power to declare
any variety of
sugarcane to be
unsuitable for
use in factories.
Prohibition of
distribution of
certain varieties
of seeds.
Purchase of
sugarcane in
reserved area.
Audit
committee
for the
calculation
of revenue
realisation.
(2) The audit committee shall, after publication of annual report of each factory
after closure of the fi nancial year, have the power to inspect any sugar factory so as to
ascertain the realisation of revenue in each sugar factory.
(3) The audit committee after inspec tion of the sugar factory shall submit a report
to the Board.
14. The Board, while deciding revenue sharing based sugarcane price, shall take
into consideration the following factors, namely:—
(a) The recorded weight of the sugarcane delivered by the sugarcane growers,
actual revenue realized from production of sugar and by -products namely bagasse,
molasses, press -mud; and accounting sugarcane juice or B-Heavy Molasses directly
utilised for production of ethanol in terms of sugar.
Explanation.— For the purpose of this section, revenue realised from sugarcane
crushed during the fi nancial year shall include actual production of sugar and by -
products, namel y, bagasse, molasses, press -mud, and sugarcane juice or B -Heavy
molasses directly utilised for production of any other produce, if any, which are suitably
valued considering the sales, opening and the closing stock though they may not have
been sold. The r evenue realised thro ugh sale of white sugar or refi ned sugar and
molasses produced from raw sugar purchased from outside sources and also from the
white sugar or refi ned sugar and molasses produced from the raw sugar accounted for
revenue sharing based sug arcane price calculated during the previous financial year
shall not be included for calculation of the revenue sharing based cane price for the
financial year under consideration.
(b) The report of the audit committee shall be taken into consideration for the
determination of revenue sharing based sugarcane price.
15. (1) As soon as the sugarcane is supplied to the occupier of factory, he shall
be liable to pay the Fair and Remunerative Price fi xed under the Sugarcane (Control)
Order, 1966 within fourteen days from the date of receipt of sugarcane.
(2) The payment shall be made on the basis of the recorded weight of the
sugarcane at the factory. The price of the sugarcane to be payable shall be calculated to
the nearest rupee.
(3) An occupier of factory shall be liable to make all payments due for the
sugarcane purchased by him and if he fails to make payments, he shall be responsible
for making such payment with interest as per clause 3 of the Sugarcane (Control) Order,
1966 from the date when such payment falls due.
(4) (a) The cost of transpor tation of sugarcane from the fi eld to factory shall be
paid by the occupier of factory over and above the Fair and Remunerative Price;
(b) The payment of cost of transportat ion by the occupier of factory over and
above the Fair and Remunerative Price shall be reviewed after completion of every four
years from the date of commencement of this Act.
(5) (a) After the payment of Fair and Remunerative Price, further price realised
by revenue sharing as determined by the Board, shall be paid within fourteen days from
the date of publication of yearly ex -mill revenue sharing based sugarcane prices and
values. All other conditions for sugarcane purchase payment shall be as per the
provisions of the Sugarcane (Control) Order, 1966.
(b) Every payment made by the occupier of factory under this Act shall be paid to
sugarcane growers through bank account only and not in cash.
Factors to be
taken into
consideration
by the
Board for
deciding revenue
sharing
based
sugarcane
price.
Payment to
sugarcane
growers.
(c) For recovery of the dues with respect to Fair and Remunerative Price, the
provisions of the Sugarcane (Control) Order, 1966 shall mutatis-mutandis be applicable
for recovery of arrears of price realised by revenue sharing.
16. (1) Any person contravening any of the provisions of this A ct shall be
punishable with fine which may extend to fifty thousand rupees.
(2) Any occupier of factory who refuses to pay for any sugarcane purchased by
him the price payable in accordance with this Act or makes any deduction from such
price in contravention of this Act, shall be punishable with imprisonment which may
extend to six months or with fine which may extend to fifty thousand rupees or with both.
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 incharge 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 di ligence 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 connivance 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 proceeded against and punished accordingly.
Explanation.— For the purposes of this section,—
(a) “company” means any body c orporate and includes a fi rm or other
association of individuals; and
(b) “director” in relation to a firm means a partner in the firm.
18. No court shall take cognizance of any offence punishable under section 16,
except upon a complaint made by an officer authorized by the Commissioner.
19. (1) Any offence punishable under section 16 may, either before or after the
institution of the prosecution, be compounded by the Commissioner or such other offi cer
as may be authorised in this behalf by the Commissioner, on payment, for credit to the
State Government, of such sum as the Commissioner or such other officer may specify:
Provided that such sum shall no t, in any case, exceed the maximum amount of fi
ne which may be imposed under this Act for the offence so compounded.
(2) Where an offence has been compounded under sub -section (1), no
proceeding or furt her proceeding, as the case may be, shall be taken against the
offender, in respect of the offence so compounded and the offender, if in custody, shall
be discharged forthwith.
20. The Commissioner, the members of the audit committee and every officer
appointed under this Act shall, when acting or purporting to act in pursuance of the
provisions of this Act, be deemed to be public servants within the meaning of section 21
of the Indian Penal Code.
21. No suit, prosecution or other legal proceedings shall lie against the audit
committee, Board, Government or its offi cer for anything which is in good faith done or
intended to be done under this Act or any rule or order made thereunder.
Offences and
penalties.
Offences by
companies.
Cognizance of
offence.
Compounding of
offences
Central Act XLV
of 1860.
Commissioner
and officers
to be public
servants.
Protection of
action taken
in good faith.
Power of
Government
to give
direction.
22. (1) The Government may, in the public interest, by order, direct the Board to
make an enquiry into any case specifi ed in the order, and the Board shall report to the
Government the result of the enquiry made by it within such period as may be prescribed.
(2) On receipt of the report from the Board, the Government shall give such
direction as they deem fit and such direction shall be final and binding.
23. (1) The Government may, by notification in the Tamil Nadu Government
Gazette, make rules for carrying into effect the provisions of this Act.
(2) In particular and without prejudice to the generality of the foregoing
provisions, such rules may provide for,—
(a) the allowances payabl e to the nominated members of the Board, the manner
in which causal v acancies among them shall be fi lled and the procedure for the conduct
of its business in discharging its functions under this Act;
(b) the correct weighment of sugarcane, the provision of facilities for weighment
and for checking weighments and timings of weighments;
(c) the method of determining the percentage of recovery of sugar from
sugarcane;
(d) the form of the records to be kept and of the returns to be made, and the
information to be furnished by persons liable to pay the revenue based sugarcane price;
(e) the form in which any notice required shall be given;
(f) any other matter which is to be or may be prescribed under this Act.
(3) Except whe n the rules are made for the fi rst time, all rules made under this
Act shall be subject to the condition of previous publication.
(4) Every rule made or notifi cation or order issued under this Act shall, as soon
as possible, after it is made or issued, be placed on the table of the Legislative Assembly,
and if, before the expiry of the session in which it is so placed or the next session, the
Legislative Assembly makes any modifi cation in any such rule or notifi cation or order or
the Legislative Assembly decides that the rule or notification or order should not be made
or issued, the rule or notification or order 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 prejudic e to the validity of anything previously
done under that rule or notification or order.
24. If any difficulty arises in giving effect to the provisions of this Act, the
Government may, by order published in the Tamil Nadu Government Gazette, make such
provisions, not inconsistent with the provisions of this Act as appears to them to be
necessary or e xpedient for removing the diffi culty. Provided that no order shall be made
after the expiry of a period of two years from the date of commencement of this Act.
(By Order of the Governor)
S.S. POOVALINGAM,
Secretary to Government,
Law Department.
Power to make
rules.
Power to remove
difficulties.