HoracePettigrew at 19:09, 25 March 2026

2026-03-25T19:09:50Z

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{{Short description|Act of the Parliament of India}}
{{Use dmy dates|date=November 2018}}
{{Use Indian English|date=November 2018}}
{{Infobox legislation
| short_title = Essential Commodities Act, 1955
| legislature = [[Parliament of India]]
| long_title = An Act to provide, in the interest of the general public, for the control of the production, supply and distribution of, and trade and commerce, in certain commodities.
| citation = [https://www.indiacode.nic.in/bitstream/123456789/1579/1/A1955__10.pdfAct No. 10 of 1955]
| territorial_extent = India
| enacted_by = [[Parliament of India]]
| date_enacted = 1955
| date_assented = 1 April 1955
| date_commenced =
| bill =
| bill_citation =
| bill_date =
| introduced_by =
| 1st_reading =
| 2nd_reading =
| 3rd_reading =
| white_paper =
| committee_report =
| amended_by = Essential Commodities (Amendment) Act, 2020<ref>{{cite web | url=https://mpa.gov.in/bills-list | title=Bills List | Ministry OF Parliamentary Affairs, Government of India }}</ref>
| repeals = Essential Commodities Ordinance, 1955 (1 of 1955)
| related_legislation =
| summary =
| keywords =
| status = in force
}}
The '''Essential Commodities Act, 1955''' ('''ECA''') is an [[Act of Parliament|act]] of the [[Parliament of India]] that was established to ensure the delivery of certain commodities or products, the supply of which, if obstructed due to [[Hoarding (economics)|hoarding]] or [[Black market|black marketing]], would affect the normal life of the people. This includes [[foodstuff]], [[Drug|drugs]], [[fuel]] ([[Petroleum product|petroleum products]]) etc.<ref>{{Cite web |url=http://fcamin.nic.in/Events/EventDetails.asp?EventId=1507&Section=Annual%20Report&ParentID=0&child_continue=1&child_check=0 |title=Ministry of Consumer Affairs of the Government of India. Official Website. Annual Report 2005 - 2006, Chapter IV, 'Essential Commodities Act 1955'. |access-date=9 May 2012 |archive-url=https://web.archive.org/web/20111105223258/http://fcamin.nic.in/Events/EventDetails.asp?EventId=1507&Section=Annual%20Report&ParentID=0&child_continue=1&child_check=0 |archive-date=5 November 2011 |url-status=dead }}</ref><ref name="ECA, 1955">{{cite web|title=ECA, 1955|url=http://haryanafood.nic.in/Acts_1_Brown.html|access-date=10 October 2013|archive-url=https://web.archive.org/web/20120925053555/http://haryanafood.nic.in/Acts_1_Brown.html|archive-date=25 September 2012}}</ref> This act was modified by the '''Essential Commodities (Amendment) Act, 2020''' as part of the [[Indian farm reforms 2020|2020 Indian farm reforms]].

The ECA was enacted in 1955 and has since been used by the Government to regulate the production, supply, and distribution of a host of commodities declared ‘essential’ to make them available to consumers at a fair price. Additionally, the government can also fix the [[minimum support price]] (MSP) of any packaged product that it declares an “essential commodity”.

The list of items under the Act includes [[Drug|drugs]], [[Fertilizer|fertilizers]], [[Legume|pulses]], and [[Cooking oil|edible oils]], as well as [[petroleum]] and [[Petroleum product|petroleum products]]. The centre can add new commodities to the list as and when the need arises, and take them off the list once the situation improves.

== Usage ==
If the Centre finds that a certain commodity is in short supply and its price is spiking, it can notify stock-holding limits on it for a specified period. The States act on this notification to specify limits and take steps to ensure that these are adhered to. Anybody trading or dealing in the commodity, be it wholesalers, retailers, or even importers are prevented from stockpiling it beyond a certain quantity.

A State can, however, choose not to impose any restrictions. But once it does, traders have to immediately sell into the market any stocks held beyond the mandated quantity. This improves supplies and brings down prices. As not all shopkeepers and traders comply, State agencies conduct raids to get everyone to toe the line and the errant are punished. The excess stocks are auctioned or sold through fair price shops.

== Background ==
The ECA was enacted in 1955 and has since been used by the Government to regulate the production, supply, and distribution of a whole host of commodities that it declares ‘essential’ to make them available to consumers at fair prices.

On 14 March 2020, the [[Union government|Union Government]] brought masks and hand-sanitizers under the act to make sure that these products—key for preventing the spread of [[COVID-19]]—are available to people at the right price and in the right quality during the [[COVID-19 pandemic in India]].<ref>{{cite news |title=Masks, sanitizers put under Essential Commodities Act |url=https://www.thehindubusinessline.com/news/masks-sanitisers-put-under-essential-commodities-act/article31062832.ece |access-date=25 March 2020 |work=@businessline |language=en}}</ref> As of 1 July 2020, however, the Government has removed masks and hand-sanitizers from its Essential Commodity List.

==Amendments==
=== Essential Commodities (Amendment) Act 2020 ===
In May 2020, Finance Minister [[Nirmala Sitharaman]] suggested that the Act will be amended and stock limit will be imposed only under exceptional circumstances such as [[famine]] or other calamities. There will be no stock limit for processors and supply chain owners based on their capacity and for exporters based on the export demand.<ref>{{Cite web|last=NEWS|first=OMMCOM|title=Centre To Amend Essential Commodities Act; Deregulate Pulses, Onion|url=https://www.ommcomnews.com/business-news/centre-to-amend-essential-commodities-act-deregulate-pulses-onion|access-date=2020-05-19|website=ommcomnews.com|date=15 May 2020|archive-date=8 November 2022|archive-url=https://web.archive.org/web/20221108013918/https://www.ommcomnews.com/business-news/centre-to-amend-essential-commodities-act-deregulate-pulses-onion|url-status=dead}}</ref><ref name=":0">{{Cite web|title=Explained {{!}} Amendments to Essential Commodities Act|url=https://www.moneycontrol.com/news/business/economy/explained-the-amendments-in-essential-commodities-act-5274551.html|access-date=2020-05-19|website=Moneycontrol}}</ref> It would also end some punitive measures. It will also deregulate agricultural produce such as pulses, onion, potato and cereals, edible oils, and oilseeds, to realize better prices for farmers.<ref name=":0" />

The '''''Essential Commodities (Amendment) Ordinance''''' was promulgated on 5 June 2020.<ref>{{Cite web|last=Ministry of Law and Justice (Legislative Department), Government of India|date=5 June 2020|title=Essential Commodities (Amendment) Ordinance|url=http://egazette.nic.in/WriteReadData/2020/219748.pdf|access-date=30 July 2020|website=E-Gazette of India}}</ref> The [[Lok Sabha]] passed the ordinance to amend ''Essential Commodities Act'' on 15 September 2020, and [[Rajya Sabha]] passed it on 22 September 2020.<ref>{{Cite news|url=https://economictimes.indiatimes.com/news/politics-and-nation/lok-sabha-clears-bill-to-amend-essential-commodities-act/articleshow/78131275.cms|title = Lok Sabha clears bill to amend Essential Commodities Act|newspaper = The Economic Times}}</ref> On 27 September 2020, the bill became an act after receiving approval from President [[Ram Nath Kovind]].The Act has been already gazetted .<ref>{{Cite web|last=Parliament|first=Indian|date=|title=Essential Commodities (Amendment) Act 2020|url=http://egazette.nic.in/WriteReadData/2020/222038.pdf|access-date=26 December 2020|website=egazette.nic.in}}</ref>

The ordinance amends the ''Essential Commodities Act'' to allow the [[Government of India]] to delist certain commodities as essential, allowing the government to regulate their supply and prices only in cases of war, famine, extraordinary price rises, or natural calamities. The commodities that have been deregulated are food items, including cereals, pulses, potatoes, onion, edible oilseeds, and oils.<ref>{{Cite web|date=2020-06-03|title=Cabinet amends Essential Commodities Act, approves ordinance to ease barrier-free trade|url=https://indianexpress.com/article/india/cabinet-amends-essential-commodities-act-farmers-6440842/|access-date=2020-07-30|website=The Indian Express|language=en}}</ref> These can only be regulated in the extraordinary circumstances previously mentioned, by imposing limits on the number of stocks of such items that can be held by persons. The Ordinance states that government regulation of stocks will be based on rising prices, and can only be imposed if there is a 100% increase in retail price (in the case of horticultural produce) and a 50% increase in retail price (in the case of non-perishable agricultural food items). These restrictions will not apply to stocks of food held for public distribution in India.<ref>{{Cite web|date=2020-06-06|title=The Essential Commodities (Amendment) Bill, 2020|url=https://www.prsindia.org/billtrack/essential-commodities-amendment-bill-2020|access-date=2020-07-30|website=PRSIndia|language=en}}</ref>

In 2021, the Parliamentary Committee on Food, Consumer Affairs and Public Distribution had submitted a report to the Union Government recommending implementation of the Essential Commodities Act, 2020. The Essential Commodities Act, 2020 was one among the three controversial [[2020 Indian agriculture acts]] that led to the year long [[2020–2021 Indian farmers' protest]]. [[Bhagwant Mann]] publicly released his statement that was made during the Committee meeting on 5 June 2020. In his statement, Mann had raised concerns that these farm laws would increase hoarding. Removal of onions and tomato from the list of Essential Commodities, would lead to price rise due to illegal stockpiling to increase the price and then selling at higher prices. This will create hardships for the poor. He also raised the issue of hoarding of potatoes.<ref>{{cite news |title=Bhagwant Mann releases statement before House panel, dares Harsimrat to come clean |url=https://indianexpress.com/article/cities/chandigarh/bhagwant-mann-releases-statement-before-house-panel-dares-harsimrat-to-come-clean-7242303/ |access-date=10 February 2022 |work=The Indian Express |date=24 March 2021 |language=en}}</ref>

Farm unions began the [[2020–2021 Indian farmers' protest]] against [[2020 Indian agriculture acts|three farm acts]] that were passed by the [[Parliament of India]] in September 2020. The acts, often called the Farm Bills,<ref>{{Cite news|date=15 January 2021|title=Farm Bills have potential to represent significant step forward for agriculture reforms in India: IMF|language=en-IN|work=The Hindu|agency=Press Trust of India|url=https://www.thehindu.com/business/Economy/farm-bills-have-potential-to-represent-significant-step-forward-for-agriculture-reforms-in-india-imf/article33577480.ece|access-date=27 January 2021|issn=0971-751X}}</ref> have been described as "anti-farmer laws" by many farmer unions,<ref>{{cite news|last1=Palnitkar|first1=Vaibhav|date=21 September 2020|title=Here's Why Farmers Are Protesting the 3 New Agriculture Ordinances|work=[[The Quint]]|url=https://www.thequint.com/news/india/farmers-protesting-the-3-new-ordinances|url-status=live|access-date=28 October 2020|archive-url=https://web.archive.org/web/20201031113722/https://www.thequint.com/news/india/farmers-protesting-the-3-new-ordinances|archive-date=31 October 2020}}</ref><ref>{{Cite news|last1=Gettleman|first1=Jeffrey|last2=Singh|first2=Karan Deep|last3=Kumar|first3=Hari|date=30 November 2020|title=Angry Farmers Choke India's Capital in Giant Demonstrations|language=en-US|work=The New York Times|url=https://www.nytimes.com/2020/11/30/world/asia/india-farmers-protest.html|url-status=live|access-date=1 December 2020|archive-url=https://web.archive.org/web/20201201005737/https://www.nytimes.com/2020/11/30/world/asia/india-farmers-protest.html|archive-date=1 December 2020|issn=0362-4331}}</ref> and politicians from the opposition who say it would leave farmers at the "mercy of corporates".<ref>{{Cite news|date=15 June 2020|title=Ordinance to put farmers at mercy of corporates|language=en|work=[[The Tribune (Chandigarh)]]|url=https://www.tribuneindia.com/news/punjab/ordinance-to-put-farmers-at-mercy-of-corporates-99720|url-status=live|access-date=2 December 2020|archive-url=https://web.archive.org/web/20201211211443/https://www.tribuneindia.com/news/punjab/ordinance-to-put-farmers-at-mercy-of-corporates-99720|archive-date=11 December 2020}}</ref><ref>{{Cite news|last1=Kulkarni|first1=Sagar|date=22 September 2020|title=Now, farmers will be back to serfdom, at the mercy of big corporates: Manish Tewari|language=en|work=[[Deccan Herald]]|url=https://www.deccanherald.com/national/national-politics/now-farmers-will-be-back-to-serfdom-at-the-mercy-of-big-corporates-manish-tewari-891010.html|url-status=live|access-date=2 December 2020|archive-url=https://web.archive.org/web/20201006071235/https://www.deccanherald.com/national/national-politics/now-farmers-will-be-back-to-serfdom-at-the-mercy-of-big-corporates-manish-tewari-891010.html|archive-date=6 October 2020}}</ref>

By mid December, the Supreme Court of India had received a batch of petitions asking for the removal of blockades created by the protesters around Delhi.<ref name=":8">{{Cite web|last=Vaidyanathan|first=A|date=16 December 2020|editor-last=Sanyal|editor-first=Anindita|title=Centre-Farmers' Committee, Suggests Supreme Court, Or "Talks Will Fail"|url=https://www.ndtv.com/india-news/farm-laws-row-supreme-court-says-government-negotiations-wont-work-proposes-panel-that-includes-centre-farmers-2339353|access-date=17 December 2020|publisher=NDTV|archive-date=17 December 2020|archive-url=https://web.archive.org/web/20201217002139/https://www.ndtv.com/india-news/farm-laws-row-supreme-court-says-government-negotiations-wont-work-proposes-panel-that-includes-centre-farmers-2339353|url-status=live}}</ref> The [[Supreme Court of India]] stayed the implementation of the farm laws in January 2021. Farmer leaders welcomed the stay order, which remains in effect.<ref name=":25">{{Cite web|last=Iftikhar|first=Fareeha|date=12 January 2021|title=Farmers reject SC committee, demand repeal of farm laws|url=https://www.hindustantimes.com/cities/others/farmers-reject-sc-committee-demand-repeal-of-farm-laws-101610463856179.html|url-status=live|archive-url=https://web.archive.org/web/20210119075509/https://www.hindustantimes.com/cities/others/farmers-reject-sc-committee-demand-repeal-of-farm-laws-101610463856179.html|archive-date=19 January 2021|access-date=15 January 2021|website=Hindustan Times|language=en}}</ref><ref>{{Cite news|date=29 January 2021|title=Government will abide by Supreme Court order on farm laws: President Kovind|language=en-IN|work=The Hindu|url=https://www.thehindu.com/news/national/government-will-abide-by-supreme-court-order-to-stay-rollout-of-farm-laws-president-kovind/article33692792.ece|access-date=9 February 2021|issn=0971-751X}}</ref> A Supreme Court appointed committee submitted its confidential report before the court.<ref name=":34">{{Cite web|date=28 January 2021|title=Supreme Court-appointed farm laws committee invites views, suggestions before February 20|url=https://www.indialegallive.com/constitutional-law-news/supreme-court-news/supreme-court-appointed-farm-laws-committee-invites-views-suggestions-before-february-20/|access-date=9 February 2021|website=India Legal|language=en-US}}</ref>

Six state governments ([[Kerala]], [[Punjab, India|Punjab]], [[Chhattisgarh]], [[Rajasthan]], [[Delhi]] and [[West Bengal]]) passed resolutions against the farms acts,<ref>{{Cite web|date=2021-01-28|editor-last=Rai|editor-first=Arpan|title=West Bengal passes resolution against three farm laws, sixth state to do so|url=https://www.hindustantimes.com/india-news/west-bengal-passes-resolution-against-three-farm-laws-sixth-state-to-do-so-101611832758966.html|access-date=2021-03-26|website=Hindustan Times|language=en}}</ref> and three states (Punjab, Chhattisgarh and Rajasthan) have tabled counter legislation in their respective state assemblies.<ref name=":35">{{Cite web|date=2020-10-31|title=Toeing Punjab and Chhattisgarh, Rajasthan introduces three bills to counter Centre's farm laws|url=https://indianexpress.com/article/india/after-punjab-now-rajasthan-introduces-three-bills-to-negate-impact-of-centres-farm-laws-6911249/|access-date=2021-03-26|website=The Indian Express|language=en}}</ref> None of the counter legislation passed the respective state governors.<ref name=":112">{{Cite web|date=2021-03-18|title=Will move SC if President doesn't give assent to Punjab amendments: CM|url=https://www.hindustantimes.com/cities/chandigarh-news/will-move-sc-if-president-doesn-t-give-assent-to-punjab-amendments-cm-101616063175466.html|access-date=2021-03-26|website=Hindustan Times|language=en}}</ref><ref name=":122">{{Cite web|last=Bhandari|first=Prakash|date=2020-12-26|title=Congress government in Rajasthan upset with Governor for withholding farm Bills passed by Vidhan Sabha|url=https://www.nationalheraldindia.com/india/congress-government-in-rajasthan-upset-with-governor-for-withholding-farm-bills-passed-by-vidhan-sabha|access-date=2021-03-26|website=National Herald|language=en}}</ref><ref name=":36">{{Cite web|last=|first=|date=20 October 2020|title=Chhattisgarh governor returns government's proposal to hold Assembly session to negate farm laws|url=https://scroll.in/latest/976280/chhattisgarh-governor-returns-governments-proposal-to-hold-assembly-session-to-negate-farm-laws|access-date=2021-03-26|website=Scroll.in|language=en-US}}</ref>

On 19 November 2021, the union government decided to repeal the bills,<ref name=":41">{{Cite web|last=Saaliq|first=Sheikh|date=19 November 2021|title=India to repeal controversial farm laws that led to protests|url=https://apnews.com/article/business-india-narendra-modi-77a931b25cf3a74727cf9514169a68cd|access-date=2021-11-19|website=AP NEWS|language=en}}</ref> and both houses of Parliament passed the Farm Laws Repeal Bill, 2021 on 29 November.<ref name = "TH37762376">{{Cite news|date=2021-11-30|title=Parliament clears Farm Laws Repeal Bill without a debate|language=en-IN|work=The Hindu|url=https://www.thehindu.com/news/national/parliament-clears-farm-laws-repeal-bill-without-a-debate/article37762376.ece|access-date=2021-11-30}}</ref> Following the announcement of the repeal of the farm laws, farmer unions continued with the demand for guaranteed minimum support prices (MSPs), reminding the government of the aim of [[doubling farmers' income]] by 2022; and the 2004 [[MS Swaminathan]]–headed [[National Commission on Farmers]] reports.<ref name="Mishra">{{Cite web|last=Mishra|first=Dheeraj|date=27 December 2020|title=Reality Belies Modi Govt Claims of Implementing Swaminathan Commission's Report|url=https://thewire.in/government/reality-belies-modi-government-implementing-swaminathan-commission-recommendations|access-date=2021-11-26|website=The Wire}}</ref>

== See also ==
* [https://www.gkmirror.in/2021/01/essential-commodities-act-1955-kya%20hai.html Essential Commodities Act 1955 क्या है?]
*[[Indian farm reforms 2020|2020 Indian farm reforms]]
*''[[Essential Services Maintenance Act]]''

== References ==
{{Reflist}}

[[Category:Acts of the Parliament of India 1955]]
[[Category:Indian business law]]
[[Category:Commodity markets in India]]
[[Category:Economic history of India (1947–present)]]
[[Category:1955 in Indian law]]
[[Category:Commodity and futures law]]

Essential Commodities Act, 1955 - Revision history

HoracePettigrew at 19:09, 25 March 2026