Legal considerations of agri reforms

Agriculture is the backbone of the Indian economy. The Government of India recently enacted three core agricultural legislations – The Farmer’s Produce Trade and Commerce (Promotion & Facilitation) Bill, The Farmer’s (Empowerment & Protection) Agreement on Price Assurance and Farm Services Act and the Essential Commodities (Amendment) Act, 2020. These Acts were met with widespread protests as they were perceived to favour large corporations by going against the interests of farmers and go beyond the scope of the Centre’s right to make laws on matters in the State list.

After a harrowing journey in the cold, braving tear gas and water cannons, thousands of farmers have congregated in the national capital demanding a recall of the Acts that would deregulate the agricultural sector and make the farmers more susceptible to exploitation by large corporations. The new Acts allow for stockpiling of food, which can lead to a rise in prices of essential commodities during times of scarcity. 30% of marginal and small farmers are poor and illiterate. They do not possess adequate bargaining power to negotiate with large corporations. Furthermore, the Bills were passed hastily through a voice vote, without much deliberation. The Acts do not mandate for a written contract, further aggrieving farmers in case of a violation. Farmers fear that they may lose their safeguards with the enactment of the new legislation.

Did the government have the power to enact these Acts?

India follows a federal structure of government with power being separated between the Union and the State governments. The Seventh Schedule of the Constitution contains three lists – Union, State and Concurrent, effectively delegating Legislative powers between the Centre and the States. Agriculture, Markets and Fairs and Trade and Commerce within the State are State subjects. However, it is subject to Entry 33 of the Concurrent List where both States and the Union can legislate. In case of a repugnancy, laws of the Union override State laws.

Entry 33 of the Concurrent List in its present form was added to the Constitution via the Constitution (Third Amendment) Act, 1954. The term agriculture has not been explicitly stated in the Concurrent List. The Union government has interpreted the term ‘food items’ to include agriculture. It has used Entry 33 as a tool to infringe on the rights of States to legislate by making laws on matters beyond its jurisdiction. Furthermore, these Acts do not mention, in their Statement of Objects & Reasons, the Constitutional provisions under which Parliament has the power to legislate on the subjects covered.

The Supreme Court in ITC Limited vs. Agricultural Produce Market Committee (APMC) and Others, 2002 has upheld the legislative powers and powers to levy tax on agricultural produce of States through intra-State agricultural marketing. In Union of India vs H.S.Dhillon, 1972, the Supreme Court held that the constitutionality of Parliamentary laws can be challenged only on two grounds – if it’s violative of fundamental rights or if the law is made on a subject in the State list.

In Punjab, where the protests and opposition to the Acts are particularly strong, the State Government has passed laws negating the Central laws, essentially removing them from the ambit of the Central laws. It is to be seen if this will stand the test of Constitutional validity. The Opposition is considering using Article 254(2) of the Indian Constitution which provides for States to enact legislation on a subject in the Concurrent List which conflicts with Central legislation, provided that Presidential assent is received by such legislation. However, this seems unlikely.

Although Federalism is not explicitly set out in the Constitution, the Supreme Court in the case of S.R Bommai Vs. Union of India, 1994 held that it forms the basic structure of the Constitution. Any law that violates the basic structure is held unconstitutional by the Supreme Court. It’s evident that agriculture as a legislative subject is outside the purview of Parliament. The Centre should not use an emergency legal provision to impinge on the rights of States. The Haryana Government’s suppression of peaceful protest is highly condemnable. Talks are ongoing between the Centre and the farmers. It is to be seen whether a consensus can be reached which proves beneficial to the stakeholders.

(The writer is a first-year law student at Symbiosis, Pune)