Gandhinagar, May 26 (). The Gujarat government on Tuesday approved an important financial and policy measure for the cooperative sugar sector. Along with this, registration was started for farmers to sell summer moong at Minimum Support Price (MSP). This will provide joint relief to more than two lakh farmers and cooperative institutions across the state.
Announcing the decision, Agriculture and Cooperation Minister Jitu Vaghani said the state government has officially approved the cane prices paid to farmers by cooperative sugar mills during the period 2007-08 to 2014-15.
This decision is expected to provide financial relief of approximately Rs 1,500 crore to the cooperative sugar mills of Gujarat, effectively eliminating the long pending tax burden.
The minister said the issue arose after the Income Tax Department issued tax demand notices to several cooperative sugar mills considering the payments made in excess of the Fair and Remunerative Price (FRP) set by the Central Government as profit.
This created a potential liability of about Rs 1,500 crore on the sector. He said that this approval now formally recognizes these payments made under revenue-sharing practices in the cooperative model.
Explaining the functioning of the sector, he said that the sugar cooperative societies of Gujarat have consistently distributed the income from by-products like jaggery, ethanol and co-generated power among the farmers, resulting in better returns to the sugarcane growers compared to many other states.
This development has come to light after the legislative and policy changes taken place at the national level after the formation of the Ministry of Cooperation.
Officials said that under the leadership of Narendra Modi and Union Home and Cooperation Minister Amit Shah, amendments were made to the Income Tax Act in 2023, allowing state-approved sugarcane pricing structures to be recognized for tax purposes.
Subsequently, the state government constituted a high-level committee which recommended formally approving the payments made during the said period.
With this decision, the Agriculture Department has announced to start online registration for procurement of summer moong under the MSP scheme for the season 2025-26.
The registration will start from May 27 till June 10 and will be done at e-Gram centers across Gujarat. Farmers will have to complete registration through biometric fingerprint or facial authentication.
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