1996 (4) TMI 503 - SC - Indian Laws

Summary

Issues Involved:
1. Constitutionality of the Jute Packaging Material (Compulsory Use in Packing Commodities) Act, 1987.
2. Alleged violation of Articles 14, 19(1)(g), and 301 of the Constitution.
3. Reasonableness of the restrictions imposed by the Act.
4. Impact on the HDPE industry and general consumers.
5. Adequacy of representation in the Standing Advisory Committee.

Summary:

1. Constitutionality of the Act:
The petitioners, manufacturers of cement, sugar, and other commodities, challenged the constitutionality of the Jute Packaging Material (Compulsory Use in Packing Commodities) Act, 1987, and the associated rules and orders. They argued that the Act, which mandates the use of jute bags for packaging, caused financial losses and business closures. The Supreme Court held that the Act aims to provide socio-economic justice to approximately 4 million rural agricultural families and 2.5 lacs industrial workers involved in the jute industry. The Act was deemed necessary to protect the interests of these individuals and was thus constitutional.

2. Alleged Violation of Articles 14, 19(1)(g), and 301:
The petitioners contended that the Act violated their right to trade and business under Article 19(1)(g) and impeded free trade and commerce under Article 301. The Court found that the Act's restrictions were reasonable and in the interest of the general public. The Act aims to harmonize individual rights with the general welfare of society, ensuring socio-economic justice. The Court held that the Act did not violate Articles 14, 19(1)(g), or 301.

3. Reasonableness of the Restrictions:
The petitioners argued that the compulsory use of jute bags was an unreasonable restriction, leading to increased costs and inefficiencies. The Court noted that the Act provides guidelines and is subject to parliamentary control. The Standing Advisory Committee, constituted under Section 4 of the Act, advises the Central Government on the percentage of commodities to be packed in jute bags. The Court found that the restrictions were reasonable and necessary to protect the interests of jute producers and workers.

4. Impact on the HDPE Industry and General Consumers:
The petitioners claimed that the Act adversely affected the HDPE industry and general consumers by escalating costs and causing inefficiencies. The Court acknowledged the competing interests but emphasized the need to balance these with the socio-economic rights of jute producers. The Court held that the Act serves the public purpose of providing economic security and justice to jute producers and workers, and the restrictions imposed were reasonable.

5. Adequacy of Representation in the Standing Advisory Committee:
The petitioners argued that the Standing Advisory Committee was not representative, as it did not include members from the HDPE industry. The Court rejected this contention, stating that the committee consists of experts and secretaries from various industries. The Court suggested that industry representatives could be consulted before the committee makes its recommendations, but this did not render the Act unconstitutional.

Conclusion:
The Supreme Court dismissed the transfer cases and writ petitions, upholding the constitutionality of the Jute Packaging Material (Compulsory Use in Packing Commodities) Act, 1987. The Court found that the Act and the orders issued under it imposed reasonable restrictions, saved by Article 19(6) of the Constitution, and did not violate Articles 14, 19(1)(g), or 301. The petitioners were ordered to pay costs of Rs. 10,000 to the Supreme Court Legal Aid Committee.