In Brief
Oudh Sugar Mills Ltd., a public company operating a sugar factory in Uttar Pradesh, challenged the Central Government's decision to place it in the central zone (rather than the eastern zone) for the purpose of fixing levy sugar prices for 1984-85 and 1985-86 crushing years. The company claimed discrimination, as similarly-situated sugar factories in the same district were placed in the eastern zone, which offered higher prices. The Supreme Court upheld the High Court's dismissal, holding that the government's zonal classification was a reasonable policy decision based on expert studies, not arbitrary discrimination. Merely placing a unit in a different zone from geographically similar units did not establish unlawful discrimination absent proof of hostility or arbitrariness."
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