Case at Bombay High Court’s Aurangabad bench: Sugar mills, OMCs come to an agreement, ethanol case disposed off

The Bombay High Court’s Aurangabad bench heard the case of Karmayogi Ankushrao Tope Samarth Sahakari Sakhar Karkhana Ltd. and others versus the Government of India on May 8, 2024, and postponed it until June 21, 2024. However, circulation motions were moved on May 9 and hence, the matters were listed on May 10, 2024. The petitions were dismissed after the court helped the sugar mills and OMCs come to an agreement. By September 30, 2024, or earlier at the OMCs’ request, the remaining contracted ethanol quantities will be lifted in four equal parts, as agreed. The court has also affirmed that since the production season is over, there will be no more purchases of B-Heavy Molasses. All associated petitions and civil applications have been dismissed in light of these statements.

Judges Presiding:
– Justice R. M. Joshi
– Justice Ravindra V. Ghuge

Detailed Summary of the Court Order:

– Dispute: The sugar mills challenged the government’s restriction on the production of ethanol through BHM and SCJ.
– Resolution: Both parties came to an agreement before the court.
OMCs’ Commitment: Made a commitment to buy all contracted ethanol, no matter what kind of feedstock was utilized.
– Obligation of Sugar Mills: Needed to sell their ethanol stock to OMCs in set monthly quotas from June 15 to September 30.
– Outcome: Sugar mills benefit from this arrangement by having help clearing their backlog of ethanol and obtaining money to pay farmers.

Positive Consequences of the Ruling:

– Facilitation of FRP Payments: Sugar mills are able to raise the necessary money to pay sugarcane farmers the Fair Remunerative Price (FRP) through the sale of ethanol reserves.
Support for Ethanol Manufacturers: The ruling by the court provides ethanol producers who have been negatively impacted by the prohibition with some relief.

Widespread Impact of the Judgment:

Echoing the Karnataka High Court’s stance, the Mumbai High Court’s verdict provides crucial support to sugar mills across Maharashtra. It addresses the challenges associated with ethanol stockpiles and ensures the availability of FRP for the agricultural sector.

Read Bombay High Court order

Disclaimer: The views and opinions expressed in the article by Dilip Patil, Managing Director of Samarth SSK Ltd., are solely his own.


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