Disposed

M/s. Oil Palm Developers and Processors Association v. The Government of Andhra Pradesh

Telangana HC3 Sept 2012WP/8057/2012

Case brief

AI extract

What is this about?

The Court held that the Andhra Pradesh Government could not unilaterally amend a G.O. fixing oil palm prices based on an agreement without hearing the petitioner. The petition was disposed of with directions to the Government to reconsider the matter de novo after discussions.

What did the court decide?

Government directed to reconsider the issue de novo after discussions with petitioner and Farmer's Welfare Association and decide within one month.

M/s. Oil Palm Developers and Processors Association… — Service and Employment | Telangana HC (2012)

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HON'BLE SRI JUSTICE C.V. NAGARJUNA REDDY W.P.Nos.8057 & 21196 of 2012

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Date : 3-9-2012

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W.P.No.8057 of 2012

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Between: M/s. Oil Palm Developers & Processors’ Association, Represented by its President K. Ramesh Babu .. Petitioner

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And Government of Andhra Pradesh, Represented by its APC & Principal Secretary, ATM, Agriculture and Co-operation (Horti), Department, Hyderabad and others .. Respondents

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Counsel for petitioner : Sri D. Prakash Reddy, Senior Counsel, for Sri M. Papa Reddy Counsel for respondent Nos.1 & 2 : Government Pleader for Agriculture Counsel for respondent No.3 : Sri Ghanta Rama Rao

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The Court made the following:

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COMMON ORDER:

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Both these Writ Petitions raise common questions of fact and law. Hence, they are heard and being disposed of together.

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The petitioner in W.P.No.8057/2012 is M/s.Oil Palm Developers and Processors’ Association (for short “the Developers & Processors’ Association”). The petitioners in W.P.No.21196/2012 are Companies involved in manufacture of Palm Oil. The price of the Fresh Fruit Bunches (FFBs) of Oil Palm is regulated by the A.P. Oil Palm (Regulation of Production and Processing) Act, 1993. Earlier, the price of the FFBs was being fixed on quarterly basis. As respondent No.1 found this process cumbersome for the farmers, the Developers & Processors’ Association and the A.P. State Oil Palm Farmers’ Welfare Association (for short the Farmers’ Welfare Association”), held discussions in the presence of the Agricultural Production Commissioner and Principal Secretary to the Government, at the Secretariat, on 2-5-2009 and reached an agreement on the fixation of price of the Oil Palm FFBs. In

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pursuance of the said purported agreement, respondent No.1 has issued G.O.Ms.No.160, Agriculture and Cooperation (Horti) Department, dated 25-6-2009 whereunder it has inter alia fixed the price of the Oil Palm FFBs by taking the net monthly weighted average price of current month of the Crude Palm Oil (CPO) realized by the A.P. Oilfed instead of the previous quarter’s average price. While the prices were accordingly fixed under the said G.O., respondent No.1 has issued G.O.Ms.No.35, Agriculture & Co-operation (Horti) Department, dated 29-2-2012 whereby it has amended G.O.Ms.No.160, dated 25-6-2009 by removing the word “net” from the words “net monthly average price of current month CPO”. Feeling aggrieved by the said amendment, the petitioners filed the present Writ Petitions.

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A counter-affidavit has been filed on behalf of respondent Nos.1 and 2 wherein they sought to justify the said amendment. In para-5 of the counter-affidavit, it is inter alia averred that in the meeting held on 29-11-2011 with the Farmers’ Welfare Association and the Developers & Processors’ Association, the former requested that the gross weighted price of the CPO be allowed instead of the net weighted average price and that in pursuance of the same, respondent No.2 has addressed letter dated 23-12012 to the Government proposing deletion of the word “net” from the G.O.Ms.No.160, dated 25-6-2009. The counteraffidavit however justified the action of the Government in

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not putting the Developers & Processors’ Association on specific notice before effecting the said amendment.

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In the reply affidavit filed by the petitioner in W.P.No.8057/2012, it was averred that as there was no specific agenda on the aspect relating to deletion of the word “net”, no discussion had taken place in the meeting on 29-11-2011; that both the Farmers’ Welfare Association and the Developers & Processors’ Association have expressed their views only and that no decision was taken in this regard.

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The Farmers’ Welfare Association and another individual got themselves impleaded as respondent Nos.3 and 4, respectively, in W.P.No.8057/2012.

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At the hearing, Sri D. Prakash Reddy, learned Senior Counsel and Sri S. Niranjan Reddy, learned counsel for the petitioners, submitted that the apprehension that on account of the addition of the word “net”, the farmers are made to bear the liability of payment of the Value Added Tax (VAT) is wholly misconceived. The learned counsel submitted that it is only the Developers and Processors and the manufacturers of the Palm Oil who are liable to pay the VAT and that the farmers are entitled to get the CPO price after excluding the VAT. The learned counsel further submitted that G.O.Ms.No.160, dated 25-6-2009 was issued on the basis of the agreement reached between the Developers & Processors’ Association and the Farmers’ Welfare

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Association and that therefore even if respondent No.1 felt it necessary to amend the G.O., it ought not to have resorted to the same without giving the Developers & Processors’ Association an opportunity of being heard.

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The learned Government Pleader submitted that as the fixation of price of the Oil Palm FFBs by taking the net monthly weighted average price of current month of the CPO, is causing serious financial loss to the Oil Palm growers/farmers, the Government has brought out the amendment by removing the word “net” in the interest of the Oil Palm farmers.

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The question whether respondent No.1 is justified in bringing out the amendment to G.O.Ms.No.160, dated 25-62009 or not, need not be considered at this stage, for, in my opinion, it ought not to have unilaterally issued G.O.Ms.No.35, dated 29-2-2012 amending the said G.O.Ms.No.160, as admittedly, the latter G.O. was issued on the agreement reached between the Developers & Processors’ Association and the Farmers’ Welfare Association. If respondent No.1 felt that the said G.O. needed an amendment, reasonableness and fairness required that one of the parties to the agreement i.e., the Developers & Processors’ Association-petitioner in W.P.No.8057/2012, which is likely to be affected by the proposed decision, is given an opportunity to putforth its views before a final decision on the issue is taken. This

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procedure having not been followed, I am of the opinion that respondent No.1 should give an opportunity to the petitioner in W.P.No.8057/2012 before finally deciding on the request of respondent No.3-Farmers’ Welfare Association to delete the word “net” in G.O.Ms.No.160, dated 25-6-2009.

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Ordinarily, this Court would have set-aside G.O.Ms.No.35 dated 29-2-2012. However, considering the fact that the said G.O. is in operation for the last six months, I refrain from doing so. However, this shall not be understood by respondent No.1 as this Court giving its seal of approval to the said G.O. Respondent No.1 is directed to reconsider the issue de novo after holding discussions with the petitioner-Developers & Processors’ Association and respondent No.3- Farmers’ Welfare Association, and take a final decision within one month from the date of receipt of this order. Till such time as a fresh G.O. is issued, G.O.Ms.No.160, dated 25-6-2009, as amended by G.O.Ms.No.35 dated 29-2-2012, shall continue to operate.

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Subject to the above directions, the Writ Petitions are disposed of.

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As a sequel, WPMP Nos.10210/2012 and 27187/2012 are disposed of as infructuous.

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_________________________ Justice C.V. Nagarjuna Reddy

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Date : 3-9-2012

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M/s. Oil Palm Developers and Processors Association v. The Government of Andhra Pradesh

Case brief

What is this about?

What did the court decide?

M/s. Oil Palm Developers and Processors Association v. The Government of Andhra Pradesh

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

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Statutes considered

Parties & counsel

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