Sugarcane crushing, payments: Punjab drags its feet on amending law to penalise errant mills

Updated 23 Sep 2020

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The law provides that all sugar mills in the province should begin crushing from Oct 1 every year. ─ File photo
The law provides that all sugar mills in the province should begin crushing from Oct 1 every year. ─ File photo

LAHORE: The Punjab government is dragging its feet on the introduction of legislation in the provincial assembly to amend the Punjab Sugar Factories (Control) Act 1950 to incorporate heavy fines for the sugar mills which delay the crushing season beyond Oct 1.

The law provides that all sugar mills in the province should begin crushing from Oct 1 every year. However, the mill owners usually delay the commencement of their operations till end of November or even, as seen in the recent years, till mid December.

On July 27, Prime Minister Imran Khan had explicitly instructed the provincial government to introduce legislation in three weeks to ensure start of the next harvest on time. The provincial cabinet approved the amendments to the Act on Aug 13. But, according to sources, it has so far not moved a finger to get it whetted by the law ministry for tabling the amendments to the assembly for their early passage.

“The amendments to the Act seem to have hit a snag,” a provincial government official told Dawn on Tuesday.

The amendments provide for a daily fine of Rs5 million and imprisonment up to three years or both for breaching deadline for commencing crushing. He blamed the government’s lack of interest coupled with strong influence of the sugar industry for the delay in the introduction of the amendment bill to the assembly for its passage. He feared the failure to get the amendment bill passed before the end of this month will deepen the sugar crisis and allow the mill owners to take advantage of the ineffective Act to delay the new harvest on time.

It may be recalled that the proposal to bolster fines for errant mills has been under consideration of the provincial government for the last two years but no action has been taken until now.

Officials say the Act in its existing form carries meagre punishments for delaying payments to growers and commencing the crushing season. Under the Act, the millers are bound to make payments to the cane farmers in 15 days. Yet they delay payments to the cultivators for months and in some cases for years because it is a non-cognizable offence. This means FIR cannot be registered against the errant millers without orders of the magistrate and if the FIR is registered the accused cannot be arrested because the offence is bailable, giving sufficient room to the factory-owners to indulge in such malpractices with impunity.

Under the Act, the millers are also supposed to pay cultivators 11 per cent interest on delayed payments of sugarcane dues beyond 15 days. But no mill ever pays the interest to the farmers. The new Punjab Cane Commissioner has recently issued notices to the mills for furnishing with details of late payments for the last 10 years for calculating the interest amount. The Cane Commissioner office believes the interest amount that the mills owe to farmers is close to Rs5 billion.

“The mills have declined to provide this information, which is necessary to declare the amount as arrears of land revenues. The law in its present shape protects the interests of the sugar mill owners only,” the official said.

Published in Dawn, September 23rd, 2020