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Business News/ Politics / Policy/  Delhi HC issues notice to Centre on cotton seed price control order
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Delhi HC issues notice to Centre on cotton seed price control order

Delhi HC issues notice to the Centre in a plea challenging the new price control notification for cotton seeds issued on 8 March

Judge Manmohan also perused a copy of the Karnataka high court’s March order which said that the Centre cannot fix royalties as they are based on mutual agreements between different companies. Photo: Pradeep Gaur/MintPremium
Judge Manmohan also perused a copy of the Karnataka high court’s March order which said that the Centre cannot fix royalties as they are based on mutual agreements between different companies. Photo: Pradeep Gaur/Mint

New Delhi: The Delhi high court on Thursday issued notice to the Centre in a plea challenging the new price control notification for cotton seeds issued on 8 March.

Monsanto Mahyco Biotech (India) Ltd (MMBL), a joint venture of Mahyco Seeds Ltd and Monsanto, moved the court challenging the Centre’s fresh notification in an ongoing case in which the firm has sought to quash provisions that allow the government to determine royalty fees.

The older price control order was issued on 7 December last year.

On 8 March, the centre reduced the maximum sale price of genetically modified Bollgard II cotton seeds to 800 (per 450 gram packet) from 830-1,000 earlier.

The sharpest cut was on royalty or trait fees, which was reduced by 74%, from 163 per packet to 43 (excluding taxes).

In India, MMBL licences its patented Bollgard II cotton seed technology to 49 seed companies in exchange for a royalty fee. More than 90% of the cotton grown in India uses this technology. The reduction in royalty fee would mean substantive losses for MMBL.

Judge Manmohan also perused a copy of the Karnataka high court’s March order which said that the Centre cannot fix royalties as they are based on mutual agreements between different companies. It, however, allowed the government to fix the maximum sale price (MSP) of Bt cotton seeds for the benefits of farmers.

The court’s order came in a plea filed by the Association of Biotechnology Led Enterprises Agriculture Group (ABLE-AG), the industry lobby of research and development (R&D) firms, seeking to quash the same price control orders.

The case will be heard next on 31 August.

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Published: 12 May 2016, 01:54 PM IST
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