Pertinent Issues with the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 (New Farm Law)

 

Hereinbelow are some of my remarks on the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020: -

 

Provision of Law	What the Law Says?	Remarks
Section 2 (d)	“farmer producer organisation” means an association or group of farmers, by whatever name called, –– (i) registered under any law for the time being in force; or (ii) promoted under a scheme or programme sponsored by the Central or the State Government;”	This provision of law fails to recognize farmer organizations that are not registered. Non-recognition of such Organizations may act to the detriment of farmers at a local level.
Proviso to Section 4 (1)	“Provided that no trader, except the farmer producer organisations or agricultural co-operative society, shall trade in any scheduled farmers’ produce unless such a trader has a permanent account number allotted under the Income-tax Act, 1961 or such other document as may be notified by the Central Government.”	The Proviso states that a trader must have a PAN under the Income Tax Act shall be able to trade. This too seems an unreasonable restriction as the transactions of farmers with traders without PAN Card will not be recognized.
Section 8	“In case of any dispute arising out of a transaction between the farmer and a trader under section 4, the parties may seek a mutually acceptable solution through conciliation by filing an application to the Sub-Divisional Magistrate who shall refer such dispute to a Conciliation Board to be appointed by him for facilitating the binding settlement of the dispute.”	This also seems extremely problematic as the precious right of the farmers to approach judicial courts have been ousted and instead, they will have to approach the Sub-Divisional Magistrate who is an executive body and works directly for the Government.
Section 11 (1)	“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 up to five lakh rupees, and where the contravention is a continuing one, further penalty not exceeding five thousand rupees for each day after the first day during which the contravention continues.”	This could mean that even if a Farmer is duped by a trader, then he may also be prosecuted under this Section and exemplary fine may also be imposed on the farmer. There is no clarity as to the protection to the farmers.

You can read the next post on the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, by clicking here.