Two ordinances that the government promulgated on Friday have penal provisions to safeguard farmers’ interests.
While the Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance 2020 provides penalty ranging from Rs 25,000 to Rs 10 lakh for traders and electronic trading platforms which violate provisions of the Act, the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance 2020 also has punitive clause.
“Whoever contravenes the provisions of section 4 or the rules made thereunder shall be liable to pay a penalty which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees…” says Section 11 (1) of the Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance. Section 4 provides for trade and commerce of scheduled farmers’ produce. Under Section 11(2), in case of violation by electronic trading platforms, the penalty may go up to Rs 10 lakh.
Both ordinances were approved by the Union Cabinet on Wednesday after these were announced as part of the government’s Covid-19 relief package.
The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance makes it mandatory for traders to make payments to farmers on the same day or within maximum three working days. It also provides for establishment of an electronic trading transaction platform for facilitating inter-state or intra-state trade of scheduled “farmer’s produce” in a trade area.
The Centre may prescribe a different procedure of payment by farmer produce organisation or agriculture co-operative society linked with the receipt of payment from the buyers.
To bring clarity, the ordinance has defined the “trade area”. Under Section 2(m), a “trade area” has been defined as “any area or location, place of production, collection and aggregation including—farm gate; factory premises; warehouses; silos; cold storages; or any other structure or place, from where trade of farmers’ produce may be undertaken…” APMC mandis and private market yards have been excluded from the definition of trade area.
It states that no market fee or cess or levy under any state APMC Act or state law shall be levied on any farmer or trader or electronic trading and transaction platform for sale purchase of farmers’ produce.
The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020 too has penal provisions to safeguard farmers’ interests. Under Section 14 (2)(i), if a sponsor fails to make payment of the amount due to farmers, such penalty may extend to one and a half times the amount due.
The President of India also promulgated The Essential Commodities (Amendment) Ordinance, 2020 to insert a new subsection (1A) in Section 3 of The Essential Commodities Act, 1955. This provides a mechanism for “regulation” of agricultural foodstuffs, namely cereals, pulses, oilseeds, edible oils, potato and supplies under extraordinary circumstances, which include extraordinary price rise, war, famine and severe natural calamity. It also provides a “trigger” to impose stock limits.
However, exemptions from stock-holding limits will be provided to processors and value chain participants of any agricultural produce, and orders relating to the Public Distribution System.
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