When economic interests take precedence—सविस्तर माहितीसाठी Business Standard मधील बातमी वाचावी.

The recent Supreme Court judgment in Shivashakti Sugars Limited Vs Shree Renuka Sugar Limited has sparked a debate on whether ‘economic interests’ should influence the courts. What would have otherwise been an ordinary civil appeal has caught the attention of the legal fraternity after the apex court chose to allow a sugar factory set up in violation of statutory norms to continue operations, after hailing the ‘economic analysis of law’ approach as the best route for the judiciary to arrive at a conclusion.

The case in question involved the setting up of a sugar mill within 15 kilometres of an existing mill, in violation of the Sugarcane (Control) Amendment Order 2006 — which stipulates this minimum distance. The requirement, initially introduced as an administrative direction through a press note by the Union government in 1991, was given statutory force through a clause in the amendment order, which came into effect retrospectively. By this time, the new mill against which the existing mill brought the case had received the necessary permissions and approvals by the relevant authorities. Regardless, the Karnataka high court ruled against the new mill after considering the statutory illegality, following which the matter came up to the Supreme Court.

This is where things took an interesting turn. Breaking away from traditional jurisprudence, the apex court chose to evaluate the issue in terms of ‘economic interests’ and allowed the mill to continue its activities, even after concluding that the establishment may have been in breach of the strict letter of the law. Taking aid of Article 142 of the Constitution, which says that the Supreme Court may pass any decree or order that is necessary for doing complete justice, the court decided to brush aside the ‘technical violation’ after considering the equitable considerations of the investment undertaken and the positive impact on employment in an area of ample sugar cane production.

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