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Harish Damodaran

New Delhi, Sept 4 The Uttar Pradesh (UP) Government has so far issued recovery certificates against 14 sugar mills that have not cleared their cane arrears for the current crushing season.

The units are three each of Mr V.K Goel’s Dhampur Sugar Mills (Dhampur, Asmoli and Rajpura) and Mr Rajkumar Adlakha’s Uttam Sugar Mills (Barkatpur, Khaikheri and Shermau), two each of Mr U.K. Modi (Modi Nagar and Malakpur) and Mr Jawaharlal Jaiswal’s JHV Group (Padrauna and Gadaura) and one each of the Jagran Group’s Shakumbari Sugar & Allied Industries (Todarpur), Mr Rana Ranjit Singh’s Rana Sugars (Belwara), Oswal Overseas (Nawabganj) and Mr Vivek Dewan’s Dewan Sugars (Agwanpur).

The issuance of these certificates, on the recommendation of the State Sugar Commissioner, empowers the district magistrate concerned to seize control of the sugar stocks, plant and machinery, land and bank accounts of a defaulting mill.

The cane dues of growers and the interest thereon can then be recovered through arrears in land revenues from the mill.

While this may, in theory, seem effective in settling farmers’ dues, in practice it is not.

Firstly, the banks already have a lien on the stocks that are seized by the district administration.

Thus, in the event of the stocks being sold, banks can file a counter-claim, saying that their dues would take precedence over that of farmers.

In the event, the district magistrate becomes a recovery agent for the banks rather than the grower.

Secondly, in the past, whenever such certificates were issued, the mills have invariably gone to court.

And finally, there is the possibility of sales not taking place in time due to the district magistrate not having the requisite marketing experience or having to follow bureaucratic procedures in disposing of the sugar.

These only add to the delay in dues getting discharged.

The UP Government had set a deadline of August 31 for all mills to make complete cane payments, failing which the certificates would be served. That process has now begun.

More Stories on : Sugar | Agricultural Policy | Other States

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