12 highlights
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The protesting farmers fear that powerful investors would bind them to unfavourable contracts drafted by big corporate law firms, with liability clauses
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In Punjab and Haryana, the epicentre of the protests, the market fee, rural development fee, and arhatiya’s commission are 3%, 3%, and 2.5%; and 2%, 2%, and 2.5% respectively. These are big sources of state revenue — with states not permitted to levy market fee/cess outside APMC areas under the new laws, Punjab and Haryana could lose an estimated Rs 3,500 crore and Rs 1,600 crore each year respectively.
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As per Union of India v H.S.Dhillon (1972), constitutionality of parliamentary laws can be challenged only on two grounds — that the subject is in the State List, or that it violates fundamental rights.
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As per Ram Krishna Dalmia v Justice S R Tendolkar (1958) and other judgments, the Supreme Court will begin hearings after presuming the constitutionality of these laws; therefore, the burden on states and individuals who challenge these Acts will be quite heavy. Generally, the Supreme Court does not stay the implementation of parliamentary laws. CAA and UAPA were not stayed.
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The Seventh Schedule of the Constitution contains three lists that distribute power between the Centre and states. There are 97 subjects in the Union List, on which Parliament has exclusive power to legislate (Article 246); the State List has 66 items on which states alone can legislate; the Concurrent List has 47 subjects on which both the Centre and states can legislate, but in case of a conflict, the law made by Parliament prevails (Article 254).
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In State of West Bengal v Union of India (1962), the Supreme Court held that the Indian Constitution is not federal. But in S R Bommai v Union of India (1994), a nine-judge Bench held federalism was part of the basic structure of the Constitution.
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“Neither the relative importance of the legislative entries in Schedule VII, Lists I and II of the Constitution, nor the fiscal control by the Union per se are decisive to conclude the Constitution is unitary. The respective legislative powers are traceable to Articles 245 to 254… The State qua the Constitution is federal in structure and independent in its exercise of legislative and executive power,” it said.
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Federalism, like constitutionalism and separation of powers, is not mentioned in the Constitution. But it is the very essence of our constitutional scheme.
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It is clear that the Union List and Concurrent List put matters relating to agriculture outside Parliament’s jurisdiction, and give state legislatures exclusive power. No entry in respect of agriculture in the State List is subject to any entry in the Union or Concurrent Lists.
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So what happens in case of legislation that covers entries in two Lists?
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In cases such as State of Rajasthan v G Chawla (1959), courts have used the doctrine of “pith and substance” to determine the character of legislation that overlaps between entries. The constitutionality of legislation is upheld if it is largely covered by one list and touches upon the other list only incidentally.
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In interpreting the lists, the Supreme Court in State of Bihar v Kameshwar Singh (1952) invoked the doctrine of colourable legislation, which means you cannot do indirectly what you cannot do directly.