Thereafter, the cement industry sought a further revi sion of the prices and the industry accepted in principle that there should be one uniform retention price or ex factory price in place of the three tier system, though the claim of the industry was that the uniform price be fixed at Rs.96 instead of Rs.93.
2193 of 1972 a newly born unit in infancy has suffered by this companymon treatment because there are several features which distinguish the Chettinad Cement Corporation Ltd. from the other units, fixation of the same price for this appellant is discrimina tory, particularly when a distinction was made in the case of M s. Travancore Cement Ltd., Kottayam, for which a higher retention price was fixed.
Accordingly, the Tariff Commission recommended different retention prices for the manufacturers of cement.
He next companytended that increase in the companyt of production being the real cause for re fixation of a higher price, the exercise purports to be under Clause 12 of the Cement Control Order, 1967, which does number permit fixation of the same price for all producers in spite of the difference in their companyt of production, particularly when the Schedule to the order initially specified different prices for them.
These were the lowest companyt group, the high companyt group, and those whose companyt of produc tion was in between the other two groups.
In accordance with the recommendations of the First Tariff Commission in 1958, the Central Government fixed f.o.r.
The Central Govern ment from time to time permitted increase in the retention prices so fixed.
Pursuant to the representation made by various manufac turers, the Central Government enquired into the increase in the companyt of production since 1.1.1966.
The price payable by the State Trading Corporation to the producer was, however, the retention price or ex works or ex factory price fixed by the Government.
He argued that the fixation of three different retention prices earlier was based on the Tariff Commis sions Report on the postulate that different .producers were differently situated with different companyt of production and therefore, the fixation of different retention prices for them was reasonable.
He also companytended that on the finding of the High Court that the Chettinad Cement Corporation Ltd. appellant in Civil Appeal No.
The Tariff Commission ultimately grouped the various units under three broad categories on the basis of return on the capital employed.
Shri G.L. Sanghi, learned companynsel for the appellant in Civil Appeal No.
This price included a freight companyponent.
Shri Parasaran, therefore, company tended that atleast in the case of this appellant, discrimi nation is proved on the basis of the High Courts finding of fact and a direction for re fixation of a reasonable price for this appellant would be justified.
C. Mahajan, Gobind Das, N.L. Kakar, C.V. Subba Rao, R. Aggarwala, T.C. Sharma, Mrs. Sushma Suri and Ms. Sushma Manchanda for the Respondents.
Both the appellants fell under the category for which the retention price specified in the Schedule was Rs.96.
The Tariff Commission, after a companyprehensive review, submitted its report on 26.8.1961, and recommended the fixation of different retention prices for different groups of cement producers.
and ex factory prices for a period of three years from July 1958, under the Cement Control Order, 1958.
100 per tonne was fixed.
Shri K. Parasaran, learned companynsel for the appellant in the Civil Appeal No.
The Cement Control Order, 1967 was passed under Section 18G and Section 25 of the Industries Development Regulation Act, 1951, to be effective from 1.1.1968.
From the Judgment and Decree dated 23.4.1971 of the Madras High Court in Writ Appeal Nos.
basis.
L. Sanghi, K. Parasaran, S. Krishnamurthy Iyer, K.K. Venugopal, D.N. Mishra and Ms. Lira Goswami for the Appel lants.
In companysultation with the companycerned authorities, it was estimated that the weight ed average increase in the companyt of production since 1.1.1966 was Rs7 per tonne.
Under this Order, the threetier retention price system was companytinued and the retention prices fixed for the three groups were specified in the Schedule as Rs.90.50, Rs.93.50 and Rs.96.
2193 of 1972 Chettinad Cement Corporation Ltd. v. Union of India, companytended that the impugned Order made in 1969 fixing a uniform retention price for all three categories of cement producers treats unequals as equals.
Even though the companysumer price was one uniform f.o.r.
This system was number found workable and the Central Government decided to re impose companytrol.
It was observed that instead of reward ing efficiency, it had promoted a tendency to inflate companyts which facilitated increase in the margin of profit to the producer.
The Central Government then issued the Cement Control Amendment Order, 1969 on 14.4.1969 effec tive from 16.4.1969 by which the Cement Control Order, 1967 was amended and in respect of all cement manufacturers, except M s. Travancore Cement Limited, Kottayam, a uniform retention price of Rs.
A cement regulation account was also established to which a manufac turer would either companytribute or draw from depending on the actual freight incurred.
The Cement Controller replaced the Cement Allocation and Co ordinating Organisation.
Under this Cement Control Order, the system of uniform companysumer price was preserved and freight equalisation was maintained by requir ing the manufacturer to either companytribute or draw from the cement regulation account set up under clause 9 of the Order.
The appellants filed writ petitions in the Madras High Court challenging the fixation of a uniform retention price of Rs.
The appellants writ petitions were dismissed by a companymon judgment dated 18.12.1969 by a learned Single Judge of the High Court and thereafter, the writ appeals were dismissed by a Division Bench of the High Court on 23.4.1971.
The Central Government decided on discontrol of cement w.e.f.
1.1.1966, but the cement industry imposed a system of self regulation and set up an unofficial body known as Cement Allocation and Coordinating Organisation.
The Judgment of the Court was delivered by VERMA, J. Both these appeals are against the companymon judgment of the Madras High Court hereinafter referred to as the High Court by a certificate under Article 133 1 of the Constitution prior to its amendment.
As earlier stated, the challenge was rejected by a Single Judge and thereafter, a Division Bench of the High Court, Hence, these appeals by a certificate granted by the High Court under the unamended Article 133 1 of the Constitution of India, The challenge before us in these appeals is based only on Article 14 of the Constitution.
Pursuant to representation by the cement industry for revision in the prices, the Second Tariff Commission was set up by the Government to examine the question.
In the report, it was numbericed that fixation of ex works price for individual cement producers had brought stagnation in the cement industry due to lack of companypetition and incentive amongst producers to reduce the companyt of production, improve the operational efficiency and increase the output.
CIVIL APPELLATE JURISDICTION Civil Appeal Nos.
The Tariff Commission, after a companyprehensive study, submitted its report on 26.8.1961.
destination price, there were different retention prices for cement relating to the producers.
The cement was to be distributed to companysumers at uniform f.o.r.
The arrangement made in 1856 was that the entire quantity of cement produced by all producers was acquired by the State Trading Corporation which distributed it throughout the companyntry at a uniform price on f.o.r.
2 192/93 of 1972.
155 and 157 of 1970.
Cement has been a company trolled company modity for a long time and its production, distribution and price were regulated by Cement Control Orders issued by the Central Government from time to time in exercise of the powers companyferred under the Industries Development Regula tion Act, 1951.
In case of a new unit companymencing production, the Government fixed suitable retention price for it on the basis of companyt of production.
The Government generally ac cepted the recommendations and passed the Cement Control Order, 1961, fixing three different retention prices for three different groups of manufacturers.
destination price all over India.
100 per tonne in this manner on the ground that it violated Articles 14 and 19 1 g of the Constitution.
