There’s an Act to help check hoarding, but is anybody using it?

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The Centre’s enthusiasm to invoke the black marketing Act to check hoarding of essential commodities seems misplaced. This becomes evident after a reality check on the use of the Prevention of Black Marketing and Maintenance of Supplies of Essential Commodities Act over the past ten years.

According to available data, just two states, Gujarat and Tamil Nadu, have used the law fairly regularly between 1998 and 2006 to issue arrest orders. But the northern Indian states, where hoarding is supposed to be most rampant, have barely used the Act.

Gujarat issued a total of 885 detention orders against hoarders during the period, followed by Tamil Nadu (114). Big states like Maharashtra, Madhya Pradesh, Andhra Pradesh, Uttar Pradesh and Orissa hardly took any action. Also, interestingly, after considering representations on behalf of the persons ordered for detention, the number of revocations made by state governments under the Act between 1998 and 2006 is 72, while the Centre contributed an additional 16.

The Act empowers states to take action against those hoarding or selling in black. The Centre has planned to hold a meeting with states shortly to discuss the implementation of the law using available evidence. The Centre is also looking at giving incentives to states for taking effective action against those contributing to the rise in the prices of essential commodities using illegal means. The authorities are also examining the alleged politician-criminal nexus in black-marketing, hoarding and profiteering activities.

There have been years like 1998, when inflation hit 13.2%. Again, there were periods like the one between June and December 2004, when inflation went above 7%. In April 2003, and January and February 2004, it was above 6%. But, obviously, states did not expect to gain much advantage by resorting to the provisions of the law, as hoarding was not per se seen responsible for the price-rise during these periods.

But, just sample this. In 2002-03, the value of goods recovered after conducting 101,953 raids using the Act was just Rs 7.81 lakh. There is no official data available for 2003-04, but in 2004, the value of confiscated goods after 83,848 raids was even less – Rs17.04 crore. In 2005, goods worth Rs 29.07 were confiscated after 71,409 raids.