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We wrote an FAQ on the Lok Pal Bill for Rediff.  http://www.rediff.com/news/special/special-parliamentary-committee-cannot-study-lokpal-bill-in-10-days/20110822.htm The Lok Pal Bill has been referred to the Standing Committee of Parliament on Personnel, Public Grievances, Law and Justice.  In this FAQ, we explain the process of these Committees. What is the role of such standing committees? The system of departmentally related standing committees was instituted by Parliament in 1993.  Currently, there are 24 such committees, organised on the lines of departments and ministries.  For example, there are committees on finance, on home affairs, on defence etc.  These standing committees examine Bills that are referred to them.  They also examine the expenditure plans of ministries in the Union Budget.  In addition, they may examine the working of the departments and various schemes of the government. How is the membership of these committees decided? Each committee has 31 members: 21 from Lok Sabha and 10 from Rajya Sabha.  Parties are allocated seats based on their strength in Parliament.  The final membership is decided based on the MP’s area of interest as well as their party’s decision on allocating the seats. Who chairs the committees? Of the 24 committees, 16 are administered by Lok Sabha and eight by Rajya Sabha.  The Chairperson is from the respective House.  Political parties are allocated the chairs based on their strength in Parliament.  Some committees such as home affairs, finance and external affairs are customarily chaired by a senior member of an opposition party. What will the Standing Committee do with the Lok Pal Bill? The Committee has invited comments and suggestions from the public on the Bill.  Comments can be sent to Mr. KP Singh, Director, Rajya Sabha Secretariat, 201, Second Floor, Parliament House Annexe, New Delhi -110001.  These may also be emailed to kpsingh@sansad.nic.in or rs-cpers@sansad.nic.in.  The Committee will examine the written memoranda.  They will also invite some experts and stakeholders for oral evidence.  Based on its examination, the committee will prepare a report with its recommendations on the various provisions of the Bill.  This report will be tabled in Parliament. Is the report decided by voting? No.  The committee tries to form a consensus while preparing the report.  However, if some members do not agree on any point, they may add a dissent note.  For example, the committee on the Civil Liability for Nuclear Damages Bill had dissent notes written by MPs from the left parties.  The Women’s Reservation Bill also had dissent notes from a couple of members. Are the committee’s recommendations binding? No.  The Committee system was formed recognising that Parliament does not have the time for detailed examination and public feedback on all bills.  Parliament, therefore, delegates this task to the committee which reports back with its recommendations.  It is the role of all MPs in each House of Parliament to examine the recommendations and move suitable amendments.  Following this, Parliament can vote on these amendments, and finalise the Bill. Can you give examples when the Committee’s work has resulted in significant changes? There are many such instances.  For example, the standing committee on science and technology examined the Civil Liability for Nuclear Damages Bill.  The committee made several recommendations, some of which increased the potential liability of suppliers of nuclear equipment in case of an accident.  All the recommendations were accepted.  Similarly, the Seeds Bill, which is currently pending in Rajya Sabha has seen several major recommendations by the Committee on Agriculture.  The government has agreed to move amendments that accept many of these recommendations. Are all Bills referred to Standing Committees? Most Bills are referred to such committees but this is not a mandatory requirement before passing a Bill.  In some cases, if a Bill is not referred to a committee and passed by one House, the other House may constitute a select committee for detailed examination.  Some recent examples include such select committees formed by the Rajya Sabha on the Prevention of Torture Bill, the Wakf Amendment Bill, and the Commercial Divisions of High Courts Bill.  There are also some instances when a Bill may be passed without the committee process. Is it a good idea to bypass the committee process? In general, this process provides a platform for various stakeholders to provide their inputs.  In the Lok Pal case, a few influential groups such as the India Against Corruption (IAC) and the National Campaign for People’s Right to Information (NCPRI) have voiced their views.  However, there may be other points of views of persons who do not have similar access to the media.  The Standing Committee provides equal opportunity to everyone to write in their memoranda.  It also allows parliamentarians to devote a significant amount of time to understand the nuances of a Bill and make suitable modifications.  Thus, the standing committee system is an opportunity to strengthen legislation in an informed and participatory manner. Is it feasible to compress this process within 10 days and get the Lok Pal Bill passed within the current session of Parliament? There should be sufficient time for citizens to provide inputs to the committee.  The committee has to examine the different points of view and find suitable provisions to achieve the final objectives.  For example, there are divergent views on the role of Lok Pal, its constitution, its jurisdiction etc.  The Committee has to understand the implications of the various proposals and then make its recommendations.  It has been given three months to do so.  Typically, most committees ask for an extension and take six to eight months.  It is not practical to expect this process to be over within 10 days. Should civil society demand that the government issue a whip and pass the Jan Lok Pal Bill? Everyone has the right to make any demand.  However, the government is duty bound to follow the Constitution.  Our Constitution has envisaged a Parliamentary system.  Each MP is expected to make up their minds on each proposal based on their perception of national interest and people’s will.  Indeed, one may say that the best way to ensure a representative system is to remove the anti-defection law, minimise the use of whips, and let MPs vote their conscience.  That may give us a more accountable government.

A few weeks ago, in response to the initial protests by farmers against the new central farm laws, three state assemblies – Chhattisgarh, Punjab, and Rajasthan – passed Bills to address farmers’ concerns.  While these Bills await the respective Governors’ assent, protests against the central farm laws have gained momentum.  In this blog, we discuss the key amendments proposed by these states in response to the central farm laws.

What are the central farm laws and what do they seek to do?

In September 2020, Parliament enacted three laws: (i) the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, (ii) the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, and (iii) the Essential Commodities (Amendment) Act, 2020.  The laws collectively seek to: (i) facilitate barrier-free trade of farmers’ produce outside the markets notified under the various state Agriculture Produce Marketing Committee (APMC) laws, (ii) define a framework for contract farming, and (iii) regulate the supply of certain food items, including cereals, pulses, potatoes, and onions, only under extraordinary circumstances such as war, famine, and extraordinary price rise.

How do the central farm laws change the agricultural regulatory framework?

Agricultural marketing in most states is regulated by the Agricultural Produce Marketing Committees (APMCs), set up under the state APMC Act.  The central farm laws seek to facilitate multiple channels of marketing outside the existing APMC markets.  Many of these existing markets face issues such as limited number of buyers restricting the entry of new players and undue deductions in the form of commission charges and market fees.  The central laws introduced a liberalised agricultural marketing system with the aim of increasing the availability of buyers for farmers’ produce.  More buyers would lead to competition in the agriculture market resulting in better prices for farmers.  

Why have states proposed amendments to the central farm laws?

The central farm laws allow anyone with a PAN card to buy farmers’ produce in the ‘trade area’ outside the markets notified or run by the APMCs.  Buyers do not need to get a license from the state government or APMC, or pay any tax to them for such purchase in the ‘trade area’.  These changes in regulations raised concerns regarding the kind of protections available to farmers in the ‘trade area’ outside APMC markets, particularly in terms of the price discovery and payment.  To address such concerns, the states of Chhattisgarh, Punjab, and Rajasthan, in varying forms, proposed amendments to the existing agricultural marketing laws.

The Punjab and Rajasthan assemblies passed Bills to amend the central Acts, in their application to these states.  The Chhattisgarh Assembly passed a Bill to amend its APMC Act in response to the central Acts.  These state Bills aim to prevent exploitation of farmers and ensure an optimum guarantee of fair market price for the agriculture produce.  Among other things, these state Bills enable state governments to levy market fee outside the physical premises of the state APMC markets, mandate MSP for certain types of agricultural trade, and enable state governments to regulate the production, supply, and distribution of essential commodities and impose stock limits under extraordinary circumstances.

Chhattisgarh

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 allows anyone with a PAN card to buy farmers’ produce in the trade area outside the markets notified or run by the APMCs.  Buyers do not need to get a license from the state government or APMC, or pay any tax to them for such purchase in the trade area.  The Chhattisgarh Assembly passed a Bill to amend its APMC Act to allow the state government to notify structures outside APMC markets, such as godowns, cold storages, and e-trading platforms, as deemed markets.  This implies that such deemed markets will be under the jurisdiction of the APMCs as per the central Act.  Thus, APMCs in Chhattisgarh can levy market fee on sale of farmers’ produce in such deemed markets (outside the APMC markets) and require the buyer to have a license.

Punjab and Rajasthan

The Punjab and Rajasthan Bills empower the respective state governments to levy a market fee (on private traders, and electronic trading platforms) for trade outside the state APMC markets.  Further, they mandate that in certain cases, agricultural produce should not be sold or purchased at a price below the Minimum Support Price (MSP).  For instance, in Punjab sale and purchase of wheat and paddy should not be below MSP.  The Bills also provide that they will override any other law currently in force.  Table 1 gives a comparison of the amendments proposed by states with the related provisions of the central farm laws. 

Table 1: Comparison of the central farm laws with amendments proposed by Punjab and Rajasthan

Provision

Central laws

State amendments

Market fee

  • The central Acts prohibit the state governments and APMCs from levying any market fee, cess, or any other charge on the trade of farmers’ produce outside the market yards notified or run by APMCs.
  • The state Bills empower the state government to levy a fee (on private traders and electronic trading platforms) for trade outside the markets established or notified under the respective state APMC Acts.  Such fees collected will be utilised for the welfare of small and marginal farmers in case of Punjab, and for running of the APMCs and welfare of farmers in case of Rajasthan.

Minimum Support Price (MSP) - fixed by the central government, based on the recommendations of the Commission for Agricultural Costs and Prices

  • The central Acts do not provide for the MSP.  They do provide for a contractual agreement for buyers and farmers to enter into prior to the production or rearing of any farm produce.  This agreement must specify a minimum guaranteed price that the buyer will pay to the farmer for the sale.  
  • The Punjab Bill provides that sale or purchase of wheat or paddy in state should be at prices equal to or above the MSP.
  • The Rajasthan Bill provides that the pre-determined prices for all crop under farming agreements should be at prices equal to or above the MSP.  

Penalties for compeling farmers to sell below MSP

  • Not prescribed.
  • In Punjab, if any buyer compels a farmer to sell wheat or paddy at a price below MSP, he will be penalised with an imprisonment term of at least three years and a fine.  
  • In Rajsthan, if a buyer compels a farmer to enter into a farming agreement below MSP, it will attract imprisonment between three and seven years, or a fine up to five lakh rupees, or both.

Delivery under farming agreements

  • The central Acts provide that the delivery of the produce can be: (i) taken by buyers at farm gate within the agreed time, or (ii) made by the farmer, in which case the buyer will be responsible for preparations for timely acceptance of the delivery. The buyer may inspect the quality of the produce as defined in the agreement.
  • In Rajasthan, if a buyer refuses to accept agricultural produce or take delivery of goods within a week from date of intimation by the farmer, he will attract imprisonment between three and seven years, or a fine of up to five lakh rupees, or both. 

Regulation of essential commodities

  • The Essential Commodities Act, 1955 empowers the central government to regulate the production, supply, distribution, storage, and trade of essential commodities, such as medicines, fertilisers, and foodstuff.  The Essential Commodities (Amendment) Act, 2020 empowers the central government to regulate the supply of certain food items, including cereals, pulses, potato, and onions, only under extraordinary circumstances such as war, famine, extraordinary price rise, and natural calamity of grave nature.  
  • The state Bills provide that the respective state government will also have the powers to: (i) regulate the production, supply, and distribution of essential commodities, and (ii) impose stock limits under extraordinary circumstances.  Such circumstances may include: (i) famine, (ii) price rise, (iii) natural calamity, or (iv) any other situation.

Imposition of stock limit

  • The Rajasthan Bill amending the central Act empowers the state government to impose stock limits, under certain conditions, on any farm produce sold under a farming agreement.  These conditions are: (i) if there is a shortage of such farm produce in the state, or (ii) if there is a 25% increase in prices of such produce beyond the maximum price which was prevailing in the market (within two years before passing of such an order by the state government).

Dispute Resolution Mechanism for Farmers

  • The central Acts provide that at first, all disputes must be referred to a Conciliation Board for resolution.  If the dispute remains unresolved by the Board after 30 days, the Sub-Divisional Magistrate (SDM) may be approached for resolution. 
  • Further, parties can appeal to an Appellate Authority (presided by collector or additional collector) against decisions of the SDM.  Both SDM and Appellate Authority will be required to dispose a dispute within 30 days from the receipt of application.
  • Instead of the dispute resolution mechanism specified under the central Acts, the Rajasthan Bill provides that disputes will be resolved by APMCs, as per the provisions of the state APMC Act.  

Power of civil courts

  • The central Acts prohibit civil courts from adjudicating over disputes under the Acts. 
  • The Punjab Bill allows farmers to approach civil courts or avail other remedies under existing laws, in addition to those available under the central Acts.
  • The Rajasthan Bill provides that the jurisdiction of civil courts over disputes will be as per the state APMC Act and rules under it.  Currently, the state APMC Act prohibits civil courts from adjudicating over disputes related to trade allowance and contract farming agreements under the Act.

Special provisions

  • -
  • The Bills provide that the state APMC Act will continue to apply in the respective states, as they did prior to enactment of the central Acts (i.e. June 4, 2020).  Further, all notices issued by the central government or any authority under the central Acts will be suspended.  No punitive action will be taken for any violation of the provisions of the central Acts. 

Note: A market committee provides facilities for and regulates the marketing of agricultural produce in a designated market area. 

Have the state amendments come into force?

The amendments proposed by states aim to address the concerns of farmers, but to a varying extent.  The Bills have not come into force yet as they await the Governors’ assent.   In addition, the Punjab and Rajasthan Bills also need the assent of the President, as they are inconsistent with the central Acts and seek to amend them.  Meanwhile, amidst the ongoing protests, many farmers’ organisations are in talks with the central government to seek redressal of their grievances and appropriate changes in the central farm laws.  It remains to be seen to what extent will such changes address the concerns of farmers.

 

A version of this article first appeared on Firstpost on December 5, 2020.