Sources told Business Recorder that the Authority has given the guilty sugar mills the deadline of November 1, to clear their stocks and compliance report. Non compliance will result in invoking of Section 19 (1) A for penal action against them.
The mills, which have been found guilty, were Ashraf Sugar Mills Limited, Kohinoor Sugar Mills Limited, Pattoki Sugar Mills Limited, Haseeb Waqas Sugar Mills Limited, Yousaf Sugar Mills Limited, Abdullah Sugar Mills Limited, Gojra Samundri Sugar Mills Limited, Brothers Sugar Mills Limited, Hamza Sugar Mills Limited, Fecto Sugar Mills Limited, Baba Farid Sugar Mills Limited, Ittefaq Sugar Mills Limited, Kashmir Sugar Mills Limited, Ramzan Sugar Mills Limited, Indus Sugar Mills Limited, Hunza Sugar Mills (Private) Limited, Sheikhoo Sugar Mills Limited, Tandlianwala Sugar Mills Limited, Chaudhry Sugar Mills Limited, Adman Sugar Mills Limited, Thal Industries Corporation Limited (Layyah Sugar Mills), United Sugar Mills Limited, Fatima Sugar Mills Limited, Kamalia Sugar Mills Limited, Crescent Sugar Mills & Distillery Limited, Dewan Sugar Mills, Diggri Sugar Mills, Rajanpur Sugar Mills, Seri Sugar Mills, Bachani Sugar Mills, Shahmurad Sugar Mills, Bawani Sugar Mills, Mirza Sugar Mills, Khairpur Sugar Mills, Kashmir Sugar Mills, Sindh Abadghar Sugar Mills, Al-Asif Sugar Mills, Taj Sugar Mills, Fecto Sugar Mills, Dadu Sugar Mills, Patoki Sugar Mills, Sangar Sugar Mills, Ansari Sugar Mills, Larr Sugar Mills, Naudero Sugar Mills, Al Noor Sugar Mills and Mitiari Sugar Mills.
In its judgement into sugar mills artificial price hike case, the MCA noted that examination of production, sales and stocks details clearly establish that a large number of sugar mill owners were indulged in hoarding to create artificial shortage of sugar in the market to raise the prices to unreasonably high levels and harm consumers through cartel-like behaviour and restrictive trade practices, which are actionable as per rules.
The MCA had registered the case against the mill owners in July last when they increased sugar prices to Rs 30 a kg and issued them show-cause notices to explain the reason of such a sharp increase.
The mill owners responded to the show cause. Their lawyers pleaded during the course of hearing that their clients were not indulged in any unlawful act.
The Authority gave detailed hearing into the case and finally gave its judgement wherein it held the mill owners guilty.
The MCA in its order said that up to December, 2004, the mill owners sold (actual lifting as per PSMA data) 816 tonnes, 7.28 percent and up to January, 2005, 1,560 tonnes, 8.9 percent of total stock. Average lifting from national mills was higher (About 22 to 35 percent).
The order further said: "After considering the arguments given by the learned counsel and the relevant record, and data as discussed supra the Authority concludes that withholding of stock of sugar by the undertaking to create artificial shortage in the market has been proved, which established collusive arrangement in terms of Section 6(1) of the Ordinance."
It added that the Authority in view of powers vested under Section 12(1) of he Ordinance, therefore, directs the respondent undertaking to discontinue and do not repeat the practice of withholding of stock to create artificial shortage of the commodity in the market.
It maintained that the respondent undertaking is also directed to report compliance of the order.
The order said that in order to investigate the matter Sugar Mills Limited (hereinafter referred to as "the undertaking") was asked to supply certain information under Section 21 of the Ordinance vide letters dated April 30 & May, 2005. The undertaking supplied the requisite information vide its letter dated May 11, 2005.
The mill owners were served Show Cause Notice No 90 of 2004-05 dated June 25, 2005. They were inter-alia required to explain their position on delayed payments to growers and unjustified increase in sugar price.
They were required to respond to the show cause notice by July 09, 2005, as to why action under Section 11 read with Section 12(I) (c) of the Ordinance should not be taken against it.
The order said that in response to the Authority's show cause notice dated June 25, 2005 the counsel of the undertaking submitted a request dated July 7, 2005 for extension of time and the Authority, acceding to his request, allowed it time up to July 16, 2005.
It observed that the counsel of the undertaking submitted provisional reply vide letter dated July 15, 2005 and supplementary reply on August 8, 2005.
The Authority after careful examination of the preliminary reply, provided to the undertaking an opportunity of being heard. The matter was fixed for hearing on 22.08.2005. On August 22-23 Dr Pervez Hassan, advocate and legal counsel of the respondent undertaking, appeared before the Authority and argued the case.
The sugar mills engaged Hasan & Hassan (Advocates) to represent them against the show cause notices dated 25 June, 2005.
The mills, which were found innocent and show cause withdrawn against them included Punjab Sugar Mills Limited, Noon Sugar Mills Limited, CSK Limited (formerly Phalia Sugar Mills Limited), Chanar Sugar Mills Limited, Shahtaj Sugar Mills Limited, Husein Sugar Mills Limited and Koninoor Sugar Mills Limited.