MP amends Mandi Act, opposes Centre's retail FDI move

Although the Madhya Pradesh government is opposing central government’s move to allow foreign direct investment (FDI) in Madhya Pradesh, it has today amended the Mandi Act, 1972 to allow retailers to buy agro commodities, particularly fruit and vegetables outside mandis.

A Bill namely Madhya Pradesh Krish Upaj Mandi (third amendment) Vidheyak 2011 tabled in the House today, amid debate over no-confidence motion moved by main Opposition in the state — Congress. This amendment has stemmed out of a Supreme Court ruling in a civil appeal ‘Orient Paper & Industries Vs Madhya Pradesh State and others’ on November 9, 2006 in which the apex court has defined processing and manufacturing in detail.

The new amendment Bill will grant powers to mandi committees to levy fee against any scheduled agri-produce which has been brought within mandi area or from anywhere in the state.

“This amendment has also been done in accordance with the Supreme Court ruling,” said a senior government official.

“The mandi committees will also have powers to withdraw exemptions available on any commodity within mandi area, this amended Act will pave ways for retailers to buy fruit and vegetables outside mandis.”

Interestingly, this amendment will empower the mandis to slap a fine of five times the cost of the processed agri-produce if processed outside mandis without paying the appropriate mandi fees. The mandi fees have been capped at 2 per cent on any agri commodity or minimum 0.5 per cent.

Traders, brokers, agents, hemmals, surveyors, stockists, warehousing firms, exporters, pressing units, processors, etc, will not be entertained as farmers or agri-producers. The House will debate on the Bill tomorrow or it will be cleared through a voice vote.

The state government today also tabled a Value Added Tax amendment Bill 2011 to exempt mobile recharge from VAT. All mobile recharge will be exempted from VAT with effect from April 8 2012. Also, the state government tabled a Bill to exempt fabrics defined under schedule-I and sugar from Vat with effect from April 8 2011.