Home Rubber Act All you need to know about the Rubber Act, 1947

Rubber Act

All you need to know about the Rubber Act, 1947

March 14, 2021

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Latex-rubber-tree — Image source: https://cutt.ly/PzH2ZyR

This article is written by Manya Dudeja from the University School of Law and Legal Studies, Guru Gobind Singh Indraprastha University. The aim of this article is to familiarise readers with the Rubber Act of 1947 and to make it easy for them to understand the process and know-how of the Act.

Introduction

How often do we realise the number of regulations that go behind the manufacturing of an item as simple looking as the rubber? It has long been under-rated, both in terms of the effort it requires and the intensive legal procedure it has to abide by. This article would recognise rubber and give it its due share of light. It would try and do justice to an irreplaceable item like rubber which has not found its due share of space on the internet.

The Rubber Act governs the development of the rubber industry and was enacted in the year 1947 by the Government of India. The Act has been amended a number of times and has faced immense evolution. The latest amendment to the Act was made in the year 2009.

Overview of the Act

The Rubber Act functions under the aegis of the Union government. It has been divided into 28 sections. It covers the constitution of the Rubber Board including its funding, salaries and allowances of members, working of the board, the board’s control over import and export of rubber, provisions regarding licencing for planting and replanting of rubber, penalties imposed in cases of default and jurisdiction of courts in rubber related cases.

The Act also restricts the possession of rubber and controls its maximum and minimum prices in the market.

Meaning of a ‘rubber plant’ under the Rubber Act

A rubber plant is recognised by the rubber board. It refers to the plants, trees, shrubs and vines of the given below:

Hevea Braziliensis, this is also called para rubber.
Manihot glaziovii, also called ceara rubber.
Castillio elastica.
Ficus elastica, also called rambong.

Members of the Rubber Board

The power to constitute the Rubber Board rests with the Central government. The board would have a common seal and would have the power to own movable and immovable property. The board can sue and be sued.

The following members will be a part of the board:

A Chairman who would be appointed by the Union government.
Two members, who would represent the State of Tamil Nadu, one of whom would represent the interests of rubber producers.
Eight members would be appointed to represent the State of Kerala. Out of these eight, six would be appointed to represent the rubber producers and out of these, three shall represent the small and marginal growers.
The Central government would nominate ten members to the board. Out of these ten, two would represent the manufacturers and four would speak for the labourers. Two members have to be from the Department of Commerce and one from the Department of Agriculture and Cooperation.
The board would also include three members of Parliament and out of these, two would be elected by the Lok Sabha or the House of the People. One would be elected by the Rajya Sabha or the Council of States.
The Rubber Production Commissioner would also be a part of the board.

Important provisions

Licencing of transactions in rubber

In order to sell, purchase, acquire or dispose of rubber, a person has to have a licence.
The Gazette of India contains the publication of a general or specific licence.
The licence has a specified period of time for which it is held valid.
The board holds the authority to extend the time period for the licence as and when it wishes to.

Restrictions on possession of rubber

Any person who is not the owner or occupant of an estate or has possession of rubber under a general or specific licence can have any possession of rubber.

Control by the Central Government

The Central government exercises two kinds of power here, the power to issue directions to the board and the power to make rules.

Power to issue directions to the board

The Central government has the power to suspend, cancel or modify any action of the board. Every decision that is taken by the board is under the control of the Central government.
An officer authorised by the Central government, can at any time inspect the record of the board.
The Central government can provide in writing, directions to the board to function in accordance with a policy. The board will be bound by these directions. However, the board has to be provided with an opportunity to express its views before the direction is imposed. The decision of the Central government would prevail and would be final.

Power to make rules

The power of deciding the terms of office of board members, nomination, vacancy filing and circumstances which demand removal from office will all be decided by the Central government.
It would decide the situations where the board can borrow money and when it can expand outside India.
The board has the power to audit the accounts.
The conditions under which the board may enter into contracts.
The deposits and investments of the board.
To prepare the budget requirements, receipt and expenditure estimates of the board.
To decide staff which can be appointed by the board, their pay, general and other allowances, travel allowances, etc.

Duties and responsibilities of board members

The members of the board are responsible for promoting the development of the rubber industry. They are responsible for:

Working on formulating schemes to market rubber.
They’re responsible for imparting technical advice to the growers of rubber.
Conducting training for students in order to improve and develop better ways of planting, cultivating, manuring and spraying.
They also have to encourage and take part in research on the scientific, technological and economic basis of rubber.
They also have to maintain the quality check, labelling and packaging of all rubber imported to India or exported from India.
Members have to combine statistics collected from growers, dealers and manufacturers.
In order to safeguard the interests of workers, they have to secure improved working conditions, better amenities and incentives for them.
The board members would also be responsible to advise the Central government on matters related to the development of the rubber industry, including its import and export.
The Central government would be advised by the board in cases of any international conferences related to rubber.
The board is also obligated to provide annual reports to the Central government based on the activities and functioning of the Rubber Act, 1947. They would also draft other reports as per the Central government’s requirement.
The board is also authorised to import rubber for sale in India and to purchase rubber from the domestic market. However, this has to be done in accordance with prices fixed by the Central government.
If the Central government wishes to make any changes with respect to the functioning of the rubber board, it has to first consult the board regarding the same. However, this won’t be formed as a ground for declaring the government’s decisions invalid.

Rubber development funds

The rubber development fund would include the money credited from the following:

All money that was a part of the fund before the Rubber (Amendment) Act, 2009 came into force.
The fund also includes the cess paid by the Central Government.
Money paid to the board in the form of loans or grants by the Central Government.
The board also owns some kinds of internal and extra-budgetary resources.
It also includes the money received under Section 26A of the Rubber Act, 1947.
Other amounts which may be levied and collected specifically for the purpose of this Act.

The general fund money would be used for:

To take care of the expenses of the board.
To meet the expenses required to carry out the responsibilities and duties of the board.
To carry out the functioning of the board as under the Rubber Act or other rules.
To meet the money requirements for rehabilitating the small and marginal growers of rubber.
To make grants to rubber estates in order to assist and develop them.

Penalty and punishment for non-compliance

Penalties

Penalties would be imposed on people under this Act, if:

They go against any provisions or rules given under the Rubber Act, 1947

Exception (Section 11 or Section 13):

If a person makes a false statement or declaration intentionally in relation to any report under this Act.

Anyone who stops a member of the board to work in accordance with his/her duties assigned to him/her under the aegis of the Act.

Deliberately hides or conceals a record or accounts book from the officers of the board when asked to produce it.

Punishment

Such a person is liable to be punished with imprisonment for a term which can extend for a period of one year or with a fine which can extend up to Rs 1000 or with both of these.

Process of prosecution by courts

In order to prosecute a person under this Act, first consent has to be acquired from the Central government.
Once consent is granted, the person can be tried by any Presidency magistrate or any other magistrate of the first class.
Though, there lies an exception to this clause. If any act is done in good faith by a member of the board, no legal proceedings will be initiated against such a person.

Major changes brought about by the 2009 Amendment

In the year 2009, the government repealed the provisions of the Act which required registration of estates and issuing of a licence for the planting as well as re-planting of rubber
The 2009 amendment also brought in a self-assessment procedure in order to collect cesses. This is important as it would not only avoid delays but also facilitate and make the process fast-paced.
The general fund and the pool fund have been replaced by the rubber development fund, integrating them into a single fund under the provisions of the amendment.
Further, under this amendment penalty for violation of any section of the rubber act has been increased.

Recent developments

This brought stress and concern to the 1.3 million cultivators of rubber since their livelihood depended on this Act. However, the government clarified that the act has been amended to function in accordance with time and the rumours of it being repealed are misplaced.

Recommendations by the board

Change in the system of licencing

The board has proposed that the system of periodic licencing be replaced by a system of one-time registration. The aim of this change is to free dealers, manufacturers and processors of rubber.

Expanding research

In order to further develop the rubber industry and to strengthen its manufacturing in development and research, it is important to expand the scope of research in rubber.

Expanding training

More personnel should be adequately trained in order to add value to the production of rubber.

Collection of data

The proposal to amend and bring the provision of statistical collection and collate data from growers of natural rubber and large producers has been put forward.

Staff strength

It has been recommended that the board’s staff be reduced. However, this should not affect the research and training in this sector.

Conclusion

The Rubber Act has been changed to suit the current scenario and further changes have been suggested to promote the development of the industry and keep it up to time. Rubber is an important part of our life today, its development would not only affect its consumption but also the large number of people whose livelihoods depend on it.

Hence it is important to update the Act which was drafted at a time much different than today while keeping in mind the interests of everyone involved in the transaction.

Reference

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