Courts don’t monitor profit, loss dealing between parties: SC

ISLAMABAD: The Supreme Court (SC) has remarked that the courts have a duty to resolve legal disputes in accordance with the law rather than to supervise pricing or monitor profit and loss dealings between the stakeholders.

A three-member bench of the apex court, headed by Justice Umer Ata Bandial and comprising Justice Sajjad Ali Shah and Justice Qazi Muhammad Amin, issued a written order in the petition, filed by Federation of Pakistan, through Secretary Ministry of Industries & Production, and another, verses Hamza Sugar Mills Ltd, Rahim Yar Khan, and others.

The court, in its written order, issued on Friday, observed that he constitutional courts of the country, had a duty to resolve legal disputes coming before them in accordance with the Constitution and the law.

The court held that in the discharge of their duties and functions, the courts did not supervise pricing nor monitor profit and loss dealings by, or between, the stakeholders.

“In our view, the high court had, in the present case, entered the uncertain territory of monitoring commercial and policy terms, regulating the supply of an edible commodity in the market,” says the written order.

This endeavour, the court held, is far removed from its jurisdiction vested by Article 199 of the Constitution and is likely to involve technical details that are outside the realm of judicial adjudication.

The court noted that common questions of law and jurisdiction raised in the petitions, pending before the high court, are already noted for its determination in writ petition No 3834 of 2020.

“The court noted that respondent private parties, who are present before us, are also ready to proceed with their cases.

“We consider that judicial consideration by the high court ought to be devoted to resolving the legal dispute between the parties, rather than the pricing mechanism regulating commercial and policy matters,” says the written order.

Accordingly, the court ordered that the high court should make a serious effort to decide the legal issues arising for determination in this matter within a fortnight from the date of receipt of this order.

“If either party prolongs the proceedings on account of adjournments or otherwise, they should be subject to penalisation, inter alia, by modification of the terms of the interim relief ordered.”

The written order noted that the impugned interim order dated Aug 3, 2021 protects the interest of the respondent mill-owners on the strength of a surety bond equal to the difference in price, charged by them and the price fixed by the regulators on July 30, 2021.

“We do not consider that the surety bond constitutes sufficient security for the regulators. According to the impugned order, the cane commissioner is maintaining the records of production and sales of all sugar mills in the province,” the court noted in written order.

The court directed that the cane commissioner should continue to do so and keep an account of the amount charged and collected by the sugar mills and the amount fixed by the regulators at the stage (ex-factory and/or retail) specified by the latter.

The court directed that difference in the two amounts be deposited contemporaneously by each sugar mill with the Deputy Registrar (Judicial) of the Lahore High Court, Lahore.

“Such deposits shall be made voluntarily but should be subject to replenishment forthwith to the correct amount that is notified to the erring sugar mill by the cane commissioner,” according to the written order.

In case of dispute about the amount of the requisite deposit to be made during the pendency of the petition before the high court, the court ordered that amount fixed by the cane commissioner could prevail.

The court noted that the additional attorney general had referred to an order, issued on April 7, 2021, passed in writ petition No 22977/2021.

That order referred to meetings being conducted by the federal and provincial government authorities with the management of sugar mills in Punjab for fixing the price of sugar. The minutes of that meeting are reproduced in the said order. It appears that a pricing formula of sugar, ex-factory and retail, based on the costs incurred by the sugar mills was settled with the government authorities.

However, the latter fixed a different price of sugar on which stocks were to be released by sugar mills in the market. This intervention by the regulators was challenged in the said writ petition for being incompetent and without lawful authority. However, the court ordered the requisite stock to be released for the month of Ramazan at the disputed price.

The order also refers to an earlier proceedings pending in the high court in writ petition No 3834 of 2020 wherein the question of vires of similar impugned action is already under consideration. Several writ petitions have since been filed by interests in the sugar industry.

“The order issued on Aug 3, 2021 impugned before us is an interim order passed in a recent writ petition.”

That order is assailed by the federal government for having been passed on the first date of hearing without affording any opportunity of hearing to the government regulators, whose notification dated July 30, 2021 fixing the policy sale price of sugar has been put in abeyance.

A surety bond for the differential amount from the higher price charged by the respondent sugar mills has been ordered as security. The court, after converting the petitions into appeals, disposed of the matter.