Commodities

Gujarat High Court strikes down State Cotton Seed Act

Press Trust of India Ahmedabad | Updated on April 28, 2011

COTTONSEED





The Gujarat Cotton Seeds Act has been struck down by the State High Court. The Act has been termed invalid as, according to the court, it was in conflict with a Union legislation.

The State Act took away the Centre's control over pricing of cotton seeds, ruled a division bench headed by Mr Chief Justice S.J. Mukhopadhaya.

The Gujarat Cotton Seeds (Regulation of Supply, Distribution, Sale and Fixation of Sale Price) Act of 2008 included cotton seeds in the schedule of essential commodities that is regulated by a law enacted by the Centre.

The bench included Mr Justice K.M. Thaker.

The National Seeds Association of India had last year challenged the validity of the Act and the price-fixation thereunder. According to the association, Parliament has passed the Seeds Act in 1966 and Seeds (Control) Order in 1983 to controlling the manufacture and marketing of seeds. In December, 2006, Parliament passed the Essential Commodities (Amendment) Act (EC Act) and cotton seed was excluded from the listed items of the schedule as an ‘essential commodity'.

INDUSTRY CHEERS

K.V. Kurmanath reports from Hyderabad: The Gujarat High Court order striking down the State's Cottonseed Act has brought cheers to the seed industry, particularly in Andhra Pradesh, a dominant player.

The seed industry has also moved the High Courts in Andhra Pradesh and Maharashtra against the respective State Acts on similar grounds. The matter is pending in courts.

“The court has rightly observed that there is no need for a special State level Act for cottonseeds, when the Central Essential Commodities cover this. Several States have developed special Acts when it was not covered at the Central level. Now that it is included back in the Central Act, there is no need for regional level acts,” Mr P Satish Kumar, President of AP Seedsmen Association, told Business Line.

The seed industry in the State, however, is not likely to be impacted this year. The Government is to come out with a pricing policy in the next few days. “The Court order is not likely to have any impact,” Mr M Prabhakara Rao, Chairman and Managing Director of Nuziveedu Seeds Limited, said.

He, however, said that the Gujarat's decision to increase cottonseed prices would certainly help the industry. “The industry is happy over the decision,” he said.

Meanwhile, the representatives of seed industry have met the Principal Secretary (Agriculture), Mr Nagi Reddy, appealing him to expedite the pricing issue. “For the last few years, there is a parity among the neighbouring States of Andhra Pradesh, Karnataka, Maharashtra and Gujarat. The latter State has increased prices and Karnataka and Maharashtra are likely to follow the suit,” he said.

“If we don't increase in Andhra Pradesh, it might create a problem. We asked the Government to ensure price parity,” he said.





Published on April 28, 2011

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