The Telegraph
Since 1st March, 1999
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Fertiliser, cement units in a spot over jute order

Calcutta, Sept. 2: The office of the Jute Commissioner has started issuing show cause notices to cement and fertiliser units for violating the jute packaging order and failing to pay the penalty.

The Jute Commissioner’s office, which was responsible for implementing the Act and collecting the penalty for non-compliance, has identified 58 cement units and 26 fertiliser units for issuing the show cause notices following a recent directive from the Delhi High Court.

Representatives from a number of companies have visited the Jute Commissioner after they received the notices. “Most cement and fertiliser companies have sought time to come up with their replies,’’ a senior official told The Telegraph.

Those show-caused include all the big names in the cement and fertiliser industry, the official noted.

Although the jute industry has been crying itself hoarse about the non-compliance of the statutory packaging order by cement and fertiliser units, the issue of imposing a penalty and the resultant revenue loss came to the fore after the Comptroller and Auditor General (CAG) pointed out in its report last year that the Jute Commissioner’s failure to collect the penalty led to a staggering Rs 3,522.11-crore revenue loss.

Following the CAG report, the Indian Jute Mills Association had filed a writ petition in the Delhi High Court. The court in June directed the Union government to follow up the matter and issue show cause notices to the erring cement and fertiliser units and arrange to realise the revenue.

Under the Jute Packaging Materials (Compulsory use in packing commodities) Act 1987, cement and fertiliser units are supposed to pack 75 per cent and 50 per cent respectively of their produce in jute bags. In case of food grains and sugar, the Act provided for 100 per cent packaging in jute bags. The cement industry has subsequently been spared from compulsory use of jute bags from 1998 and fertiliser units from 2001.

The CAG in its report blamed the Union government and the Jute Commissioner for their failure to implement the Act in proper perspective, which caused a huge loss of revenue.

Although the Act was introduced in 1987 as part of the then prime minister Rajiv Gandhi’s Bengal Package, the official agencies were never serious about its implementation. The act introduced as a “socio-economic’’ measure to help over four million jute farmers in Bengal and other eastern states and Andhra Pradesh, was opposed by the cement and fertiliser industries right from the start.

The government now plans to progressively dilute the order for sugar and food grains as well.

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