ESSENTIAL COMMODITIES
(AMENDMENT) ACT, 2020
Preamble - ESSENTIAL COMMODITIES (AMENDMENT) ACT, 2020
THE
ESSENTIAL COMMODITIES (AMENDMENT) ACT, 2020
[Act
No. 22 of 2020]
[26th
September, 2020]
PREAMBLE
An Act further to amend the Essential Commodities
Act, 1955.
Be it enacted by Parliament in the
Seventy-first Year of the Republic of India as follows:--
Section 1 - Short title and commencement
(1) This Act may be
called the Essential Commodities (Amendment) Act, 2020.
(2) It shall be deemed to
have come into force on the 5th day of June, 2020.
Section 2 - Amendment of section 3
In of the Essential Commodities
Act, 1955 (10 of 1955), after sub-section (1), the following sub-section shall
be inserted, namely:--
'(1A) Notwithstanding anything
contained in sub-section (1),--
(a) the supply of such
foodstuffs, including cereals, pulses, potato, onions, edible oilseeds and
oils, as the Central Government may, by notification in the Official Gazette,
specify, may be regulated only under extraordinary circumstances which may
include war, famine, extraordinary price rise and natural calamity of grave
nature;
(b) any action on
imposing stock limit shall be based on price rise and an order for regulating
stock limit of any agricultural produce may be issued under this Act only if
there is?
(i) hundred percent
increase in the retail price of horticultural produce; or
(ii) fifty percent
increase in the retail price of non-perishable agricultural
foodstuffs, over the price prevailing immediately preceding twelve months,
or average retail price of last five years, whichever is lower:
Provided that such order for regulating
stock limit shall not apply to a processor or value chain participant of any
agricultural produce, if the stock limit of such person does not exceed the
overall ceiling of installed capacity of processing, or the demand for export
in case of an exporter:
Provided further that nothing contained
in this sub-section shall apply to any order, relating to the Public
Distribution System or the Targeted Public Distribution System, made by the
Government under this Act or under any other law for the time being in force.
Explanation.--The expression
"value chain participant", in relation to any agricultural product,
means and includes a set of participants, from production of any agricultural
produce in the field to final consumption, involving processing, packaging,
storage, transport and distribution, where at each stage value is added to the
product.?.
Section 3 - Repeal and savings
(1) The Essential Commodities
(Amendment) Ordinance, 2020 (Ord. 8 of 2020) is hereby repealed.
(2) Notwithstanding such
repeal, anything done or any action taken under the Essential Commodities Act,
1955 (10 of 1955), as amended by the said Ordinance, shall be deemed to have been
done or taken under the corresponding provisions of the said Act as amended by
this Act.
Statement of Objects
and Reasons - ESSENTIAL COMMODITIES (AMENDMENT) ACT, 2020
STATEMENT
OF OBJECTS AND REASONS
(1) The Essential
Commodities Act, 1955 (10 of 1955) was enacted to regulate the production,
supply and distribution of, and trade and commerce in, certain commodities
which are declared as essential commodities and specified in the Schedule to
that Act.
(2) While India has
become surplus in most agricultural commodities, farmers have been unable to
get better prices due to lack of investment in cold storage, warehouses,
processing and export as entrepreneurs get discouraged by the regulatory
mechanisms in the Essential Commodities Act, 1955. A High Powered Committee of
Chief Ministers who examined this issue, recommended removal of stringent
restrictions on stock, movement and price control of agricultural foodstuffs
for attracting private investments in agricultural marketing and
infrastructure.
(3) Due to COVID19
pandemic, the economy had been adversely affected leading to unemployment and
slowdown. The agriculture sector has the potential of making significant
contribution to economic growth and therefore, to boost immediate investment in
this sector, increase competition and enhance farmers' income, there was a need
to create an environment based on ease of doing business and for removing the
fear of frequent statutory controls under the Essential Commodities Act.
(4) As Parliament was not
in session and there was an immediate need for legislation in this regard, the
Essential Commodities (Amendment) Ordinance, 2020 was promulgated by the
President of India on the 5th day of June, 2020 under clause (1) of article 123
of the Constitution.
(5) The Essential Commodities
(Amendment) Bill, 2020 which seeks to replace the Essential Commodities
(Amendment) Ordinance, 2020 (Ord. 8 of 2020) provides in the newly inserted
sub-section (1A) to section 3 that notwithstanding the provisions of
sub-section (1),--
(a) the supply of such
agricultural foodstuff as are notified by the Central Government shall be
regulated only under extraordinary circumstances which may include war, famine,
extraordinary price rise and natural calamity of grave nature;
(b) any action for
imposing stock limit shall be based on price rise, subject to the conditions
and exemptions specified therein.
(6) The Bill seeks to
replace the aforesaid Ordinance.