Constitutional Validity of New Farm Laws… By Dr. Manmohan Singh, Former IAS

  Ever since the three ordinances were promulgated by the President in June 2020, farmers’ organizations across the country have been agitating against them. Despite widespread protests, the bills to replace these ordinances were hurriedly passed by Parliament and the President gave assent.

  The Central Government claims that these laws would transform agriculture and enhance farmers’ income. On the other hand, farmers contend that these laws are detrimental to their interests and the real motive is to promote the corporate sector in agriculture. Amidst these claims and counter-claims constitutionality of these laws is also being questioned. It is being said that the new laws are an assault on the federal structure of our constitution. Some petitions have also been filed in the Supreme Court. We shall try to examine the constitutional basis of these laws from a common man’s point of view.

Powers to Frame Laws 

The legislative powers of Parliament and Legislature of a State have been laid down in article 246 of the Constitution which is reproduced below.

“246. (1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the “Union List”).

(2) Notwithstanding anything in clause (3), Parliament, and subject to clause (1), the Legislature of any State also, have the power to make laws concerning any of the matters enumerated in List III in the Seventh Schedule (in this Constitution referred to as the “Concurrent List”).

(3) Subject to clauses (1) and (2), the Legislature of any State has exclusive power to make laws for such State or any part thereof concerning any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the “State List”).

(4) Parliament has the power to make laws concerning any matter for any part of the territory of India not included [in a State] notwithstanding that such matter is a matter enumerated in the State List”.

In a nutshell, Parliament has exclusive powers to make laws on the matters mentioned in the “Union List” and the Legislature of a State has exclusive power to make laws on the matters included in the “State List”. So far as matters in the “Concurrent List” are concerned Parliament and Legislature of a State both have powers to make laws subject to proviso laid down in article 246 (2). In case of inconsistency between laws made by Parliament and the State Legislature, the issue is to be dealt with according to the provisions of article 254. 

Let us scrutinize the three lists given in the Seventh Schedule of the Constitution to find out the entries which enable the Parliament and State Legislatures to farm laws about agriculture and related matters.

Union List 

   There are 97 entries on this list. No entry in this list mentions “agriculture”, “agricultural produce”, “farmer”, “farmers’ produce”, or “farm services”. The word “agricultural” is used as an adjective in the following entries :

82. Taxes on income other than agricultural income.

86. Taxes on the capital value of the assets, exclusive of agricultural land, of individuals and companies; taxes on the capital of companies.

87. Estate duty in suspect of property other than agricultural land.

88. Duties in respect of succession to property other than agricultural land.

 By these entries agricultural income is excluded from the purview of income tax and agricultural land is excluded from the purview of capital gain tax, estate duty and duties to be levied in succession to property.

  Entry 57 deals with fishery and fisheries beyond territorial waters. Thus, we find that there is no entry in the Union List which gives exclusive power to Parliament to make laws concerning agriculture and related matters.

State List 

There were 66 entries on this list. Five entries have since been omitted by constitutional amendments. The following entries pertain to agriculture and related matters: -

14. Agriculture, including agricultural education and research, protection against pests, and prevention of plant diseases.

15. Preservation, protection, and improvement of stock and prevention of animal diseases; veterinary training and practice.

16. Pounds and prevention of cattle trespass.

18. Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agriculture of loans; colonization.

21. Fisheries.

26. Trade and commerce within the State subject to provisions of entry 33 of List III.

27. Production, supply, and distribution of goods subject to provisions of entry 33 of List III. 

28. Markets and fairs.

30. Money lending and money-lenders; relief of agricultural indebtedness.

32. Incorporation, regulation, and winding up of corporations, other than those specified in List I, and universities; unincorporated trading, literary, scientific, religious, and other societies and associations; co-operative societies.

45. Land revenue, including the assessment and collection of revenue, the maintenance of land records, survey for revenue purposes, and records of rights and alienation of revenues.

46. Taxes on agricultural income.

47. Duties in respect of succession to agricultural land.

48. Estate duty in respect of agricultural land.

54. Taxes on the sale or purchase of goods other than newspapers, subject to provisions of entry 92A of List I].

58. Taxes on animals and goats.

65. Jurisdiction and powers of all courts, except the Supreme Court, concerning any of the matters in the List.

66. Fees in respect of any of the matters in this list, but not including fees taken in any court.

 A perusal of the above entries makes it clear that the State Legislatures have exclusive powers to make laws about agriculture, agricultural land, and related matters including animal husbandry (dairy, goatery, piggery, poultry) and fisheries. Marketing of products of agriculture and other related activities is also covered under these entries. Relations between the landowner and tenant are covered under entry 18. Therefore, agriculture, agricultural land, and related matters fall in the exclusive domain of States.

Concurrent List 

 There are 47entries on this list. Examination of this list shows that there is no entry in this list that directly deals with agriculture or related matters. However, the following entries have an indirect relation with agriculture. 

7. Contracts, including partnership, agency, contracts of carriage, and other special forms of contracts, but not including contracts relating to agricultural land.

33. Trade and commerce in, and production, supply, and distribution of, –

(a) The products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest, and imported goods of the same kind as such products;

(b) foodstuffs, including edible oilseeds and oils;

(c) cattle fodder, including oilcake and other concentrates;

(d) raw cotton, whether ginned or unginned and cotton seeds; and

(e) raw jute.

Although entry 33 deals with trade and commerce in items mentioned in it yet the Central Government has framed new agri-laws based on this entry. The issue of the constitutionality of new farm laws boils down to whether the Central Government is empowered to enact these laws based on entry 33 of Concurrent List or it has encroached upon the rights of States as enshrined in various entries related to agriculture and allied matters in the State List. 

First of all trade and commerce are fundamentally different from agriculture and related activities. Trade and commerce involve the purchase and sale of goods or services. On the other hand, agriculture and related activities involve the growing of crops and the rearing of animals. Secondly, it is important to mention that the present format of entry 33 of the Concurrent List is the result of the Amendment of the Constitution in 1954. It would be relevant to know the need and background of this amendment to understand its significance and the intention of the framers of the Constitution.

Background of Amendment of Entry 33 

 Full text of entry 33 of the Concurrent List as it existed in the Constitution when it was adopted in 1950 was as under :

“33. Trade and Commerce in, and production supply and distribution of the products of industries where the control of such industries by the Union is declared by law to be expedient in the public interest.”

 Entry 52 of Union List deals with such industries. The objective of entry 33 of the Concurrent List was to bring trade and commerce in the products of such industries to the legislative domain of the Centre and the States. There was no mention of any item connected with agriculture in entry 33 of the Concurrent List. Thus, we may conclude that the founding fathers of our Constitution did not intend to include any matter related to agriculture in the Concurrent List.

 Soon after independence when the Constitution was being framed the country faced a huge deficit of food and certain other commodities in different parts of the country. To meet this extraordinary situation article 369 was incorporated to give temporary powers to Parliament to make laws concerning certain matters in the State List as if they were matters in the Concurrent List. Article 369 is reproduced below :

“369. Notwithstanding anything in this Constitution, Parliament shall, during five years from the commencement of this Constitution, have power to make laws concerning the following matters as if they were enumerated in the Concurrent List, namely: -

(a) trade and commerce within a State in, and the production, supply, and distribution of, cotton and woolen textiles, raw cotton (including ginned cotton and unginned cotton or kapas), cottonseed, paper (including newsprint), food-stuffs (including edible oilseeds and oil), cattle fodder (including oil-cakes and other concentrates), coal (including coke and derivatives of coal), iron, steel, and mica;

(b) offenses against laws concerning any of the matters mentioned in clause (a), jurisdiction and powers of all courts except the Supreme Court concerning any of those matters, and fees in respect of any of those matters but not including fees taken in any court; but any law made by Parliament, which Parliament would not but for the provisions of this article have been competent to make, shall, to the extent of the incompetency, cease to affect the expiration of the said period, except as respects things done or omitted to be done before the expiration thereof.”

The validity of Article 369 was to expire in January 1955. However, the situation on the food-front was not yet satisfactory. Therefore, it was considered necessary to keep trade and commerce in, and the production supply and distribution of some essential commodities mentioned in article 369, namely, raw cotton (including ginned cotton or unginned cotton or kapas), cottonseed, food-stuffs (including edible oilseeds and oil) and cattle fodder (including oil-cakes and other concentrates) in Concurrent List. Consequently, entry 33 of Concurrent List was amended vide “The Constitution (Third) Amendment Act 1954 to include these items.” The amended text of entry 33 of Concurrent List has already been reproduced under the heading Concurrent List. Subsequently, the Essential Commodities Act 1955 was passed to regulate the distribution of essential commodities to check to hoard and black-marketing. Thus, the objective of amending entry 33 was to bring trade and commerce in certain essential commodities in the Concurrent List. There was no intention to bring agriculture and related matters to the Concurrent List. Had it been so than the corresponding entries in the State List should have been omitted as was done in the case of some other amendments (education, forests) or at least the corresponding entries in the State List should have been made subject to the provisions of entry 33 of Concurrent List. Nothing like this was done.

To sum up, the founding fathers of the Constitution gave exclusive power to make laws concerning agriculture and related matters to States. On this basis, the States have been making laws concerning agriculture and related matters without any interference by various Central Governments. Now the country is surplus in food. Therefore, the text of entry 33 of Concurrent List should have been restored to the format as it existed in the original Constitution by repealing the amendment made in 1954.

Encroachment of Legislative Powers of States 

  New farm Laws have been framed based on entry 33 of Concurrent List which primarily deals with trade and commerce in certain industrial and agricultural products. By doing so the Central Government has encroached upon the Legislative Powers of States. Let us examine how these new laws impinge on various entries of the State List.

Firstly consider the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act 2020. This Act is based on sub-entries 33 (b1), (c), (d) and (e) of Concurrent List. This Act allows trade and commerce of farmers’ reviews outside the premises of state agricultural markets established under various State Acts. The term “farmers’ produce” does not occur anywhere in the Seventh Schedule. Its definition is given in sub-section 2(c) of this Act, which is reproduced below :

2(c) “farmers’ produce” means, -

           (i) foodstuffs including cereals like wheat, rice or other coarse grains, pulses, edible oilseeds, oils, vegetables, fruits, nuts, spices, sugarcane, and products of poultry, piggery, goatery, fishery and dairy intended for human consumption in its natural or processed form;

           (ii) cattle fodder including oilcake and other concentrates; and

           (iii) raw cotton whether ginned or unginned, cotton seeds and raw jute;

This definition of “farmers’ produce” has several implications. Firstly we should understand the distinction between “food grains” and “foodstuffs”. “Flood grains” are seeds of crops while “foodstuffs” are obtained by processing products of crops. While wheat is food grain, but various products of wheat like flour, maida, suji, bread, biscuits, etc. are “foodstuffs”. “Foodstuffs” are covered by sub-entry 33(b) of Concurrent List which reads “foodstuffs including edible oilseeds and oils”. But extending the meaning of “foodstuffs” to include wheat, rice, other coarse grains, vegetables, fruits, nuts species, and sugarcane goes beyond the scope of entry 33 (b) and impinges on entry 14 and 28 of the State List. Secondly the meaning of “foodstuffs” has also been enlarged to cover products of poultry, piggery, goats, fishery, and dairy. Matters related to poultry, piggery, goats, and dairy are covered by entries 15, 16, and 28 of the State List. The fishery is covered by entries 21 and 28 State List. To sum up the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act 2020 impinges upon entry 14, 15, 16, 21, 28, 58, 65, and 66 State List.

   There is another implication of enlarging the meaning of “foodstuffs” to include products of poultry, piggery, goats, and dairy. All the items mentioned in sub-entries 33(b), (c), (d), and (e) are products of crop-origin. Products of poultry, piggery, goats, fishery, and dairy do not fall in this category. Extension of the meaning of “foodstuffs” to cover products of these activities tantamount to enlarging the scope of entry 33(b) of Concurrent List. According to article 368, any change in the Seventh Schedule needs a constitutional amendment. However, no constitutional amendment was carried out before passing the new Act.

    Now let us consider the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act 2020. This Act is also based on sub-entry 33 (b), (c), (d), and (e) of Concurrent List. This Act deals with agreements between farmers’ and agribusiness entities for farm services and the sale of farming produce. The meaning of “farming produce” is given in subsection 2 (g) of this Act which is identical with the meaning of “farmers’ produce” in the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act 2020. By extending the meaning of “foodstuffs” this Act impinges on entries 14, 15, 16, 21, 28, 58, 65, and 66 of State List. Also, this Act impacts entry 18 of State List which includes the relation of landlord and tenant. Still further this Act also impinges on entry 7 of Concurrent List which excludes contracts relating to agricultural land from the purview of Concurrent List.

 In this case also extending the meaning of “foodstuffs” to include products of poultry, piggery, goats, fishery, and dairy tantamount to the amendment of sub-entry 33 (b) of Concurrent List which required amendment of Constitution by article 368. 

 So far as the Essential Commodities (Amendment) Act 2020 is concerned it falls in the domain of entry 33 of Concurrent List and does not impinge on the exclusive power of States. This Act removes foodstuffs including cereals, pulses, potato, onion, edible oil seeds, and oils from the list of essential commodities that can be regulated under ordinary circumstances. This would lead to hoarding, undue profiting, and black marketing in these commodities. This negates the very purpose for which entry 33 of Concurrent List was amended in 1954.

To sum up, the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act 2020 and the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act 2020, encroach upon the legislative powers of States.