It is considered desirable, in the interests of increased agricultural production as well as in the interests of the common consumer, to set up a State Agency for the purpose of undertaking trading in foodgrains in a commercial manner but within the framework of an over-all Government policy. Only by such a measure it will be possible to effectively implement any policy of ensuring that the primary producer obtains the minimum price that may be announced from time to time and to protect the consumer from the vagaries of speculative trade.2. The setting up of the Food Corporation of India, as provided for in this Bill, will, therefore, be one of the essential and important steps in the implementation of Government's food policy. The Corporation will be the first organised attempt to take up State trading in foodstutls on an appreciable scale The Agency will also be used to build up gradually buffer stocks.3. The Corporation will engage itself primarily in the purchase, storage, movement, distribution and sale of foodgrains. Provision has also been made in the Bill enabling the Corporation to deal in other foodstuffs if considered necessary by the Government. The Corporation may also discharge certain incidental functions as provided for in the Bill in consultation with the Central Government.4. The Corporation will be encouraged to function benerally as an autonomous organisation working on commercial lines. It is expected to secure for itself a strategic and commanding position in the foodgrains trade of the country. Bearing in mind the several large spheres in which the Corporation will ultimately have to operate, this Bill is being introduced to enable it to function as a statutory Corporation wholly owned by the Government.5. It is necessary that the Corporation should work with the active and continued co-operation of State Governments and their machinery. The Bill. therefore, provides for the setting up of Boards of Management or State Food Corporations, as the case may he, to secure such co-operation and participation in a practical and effective way. - Gazette of India, 17.11.1964. Pt. 11. Section 2, Extra. p. 782.Amending Act 57 of 1968. - With the establishment of Food Corporation of India under the Food corporations Act, 1964, the work relating to the storage. movement, distribution and sale of foodgrains, performed by the Regional Directorates under the Food Department of the Government, is being gradually transferred to the Food Corporation of India. The staff working in the Regional Directorates are also being transfered to the Corporation along with the work. The object of this Bill is to prescribe the conditions of service in regard to pay,pension and other similar matters which would he applicable to the employees on their transfer to the Corporation. In doing so. care has been taken to ensure that the pay, pension and other conditions of service are not as far as possible, adversely affected on account of such transfer.2. Opportunity is being taken to declare the Central Government as the "appropriate Government" under the Industrial Disputes Act, 1947 in relation to the Food Corporation of India. - Gazette of India. 25-7-1967, Pt. 11, Section 2, Extra. p. 613.Act 67 of 1972. - In order to remove certain practical difficulties and deficiencies which have been experienced in the working of the Food Corporation Act, 1964, it is proposed to amend the Act suitably as explained in paragraphs 3 to 5.2. The Food Corporations Act does not extend at present to the, State of Jammu and Kashmir. The Government of Jammu and Kashmir has requested that the activities of the Food Corporation of India should he extended to that State also. It is, therefore, proposed to extend the Act to that State.3. Sub-section (2) of section 4 of the Act requires the Food Corporation of India to obtain the previous approval of the Central Government before establishing offices or agencies in or outside India. With the increased utilisation of the services of the Corporation by the State Governments for the purposes of procurement and distribution of foodgrains, it has become necessary to establish local offices and agencies like "purchase centres" in various parts of the country. Obviously, the Corporation cannot perform its functions efficiently and effectively if it is required to obtain the previous approval of the Central Government each time it has to establish any office or agency. It is, therefore, proposed to dispense with the requirement in the Act of obtaining the previous approval of the Central Government for establishing offices and agencies within India.4. In pursuance of the recommendations contained in paragraph 22, of the Report dated 12th November, 1970, of the Joint Select Committee to which the Comptroller and Auditor-General's (Duties, Powers and Conditions of Service) Bill, 1969, was entrusted, it is proposed to amend section 34 of the Act for the purpose of empowering the Comptroller and Autidor-General's of India to direct the manner in which the accounts of a Food Corporation shall he audited, to have a supplementary or test audit done and to comment upon or supplement the audit report of the professional auditors. Provision is also being made in section 35 whereby such comments or supplement made by the Comptroller and Auditor-General shall be laid before both Houses of Parliament.5. The amendments proposed in cis. 3 and 5 of the Bill are of a clarificatory nature, Under the former it is proposed to clarify that the expression "foodstuffs" used in Section 13 of the Act also includes edible oils and oil seeds. This is intended to remove any possible doubts about the extent of the activities of the Food Corporation of India under the said Section 13. Similarly, Clause 5 of the Bill seeks to amend Section 27 of the Act enabling a Food Corporation to borrow money from the Central Government also - S.O.R. Gazette of India, 16-11-72, Pt.II S.2 Ext. p. 1093.Act 12 of 1977. - Section 12A of the Food Corporations Act, 1964 regulates transfer of officers and staff working in the Food Deptt. of the Government of India to the Food Corporation of India (hereinafter referred to as the Corporation) as and when the work relating to purchase, storage, movement, distribution and sale of foodgrains performed by the Food Department was transferred to the Corporation. The said Section 12A envisages the exercise of two options by the said officers and staff. The first option is required to he given before the order of transfer is made to indicate as to whether the employee is willing to be transferred to the Corporation or not and the second has to be exercised within six months from the date of transfer as to whether he would like to he governed by the retirement benefits of the Central Government or of the Corporation. The date of formal transfer in the case of all those whose services were placed with the Corporation from time to time was fixed as Ist March, 1969 which corresponds to the date when the process of transfer of functions from the Food Department was completed. It took some time to secure the first option mentioned above and to get the service particulars from the employees with the result that even the first transfer order was issued only in 1972. The employees could not, therefore, give their option in regard to the retirement benefits as the period of six months from the date of transfer had already expired by the time the transfer orders were issued. In some cases employees have either died or retired before the issue of formal transfer orders or before exercising their second option. Formal orders of transfer are yet to be issued in respect of certain employees. In view of the above, cases relating to retirement benefits of many employees still remain unsettled. Keeping in view also the urgency to mitigate the financial hardship of such employees, it was condiscred necessary to amend the Food Corporations Act. 1964. by means of an Ordinance. Accordingly, the Food Corporations (Amendment) Ordinance, 1976. was promulgated on 31st December. 1976.2. The said Ordinance inter alia provided for the following matters, namely(i) The exercise of a fresh option in respect of retirement benefits to all serving employees of the Corporation within a period of six months from the date of commencement of the Ordinance irrespective of whether they had exercised the option earlier or not.(ii) In respect of those employees for whom formal orders of transfer are yet to be issued, the said option can be exercised within a period of six months from the date of such orders.(iii) The validation of all the options exercised by the employees who have either died or retired.(iv) Conferment of Central Government retirement benefits to certain employees as such benefits were more favourable than the retirement benefits of' the Corporation.The Bill seeks to replace the above Ordinance - S.O.R. Gazette of India. 31.3-77, Pt.II, Section 2 Ext , p 58.Act 53 of 1982 - According to section 12A of the Food Corporations Act, 1964, employees of the Central Government whose services were transferred to the Food Corporation of India are entitled to a second opportunity of making representation in disciplinary proceedings where it is proposed to impose on the employees concerned the penalty of dismissal, removal or reduction in hank. This is in accordance with the constitutional provision which applied to Government servants at the time of their transfer. Subsequently by the Constitution (Forty-second Amendment) Act, 1976 clause (2) of article 311 of the Constitution has been amended doing away with the second opportunity. The relevant service rules governing the Government servants have already been amended to be in conformity with the Constitutional amendments.2. With the amendment of the Constitution, there is now no justification for continuing to allow the transferred employees of the Food Corporation of India the opportunity of being heard twice when that is no longer availahe even to Government servants. The rationale for giving the benefits that they would have been entitled to this opportunity had they continued to remain in Government service, has disappeared. In view of this and in order to bring the provisions of section 12A of the Food corporations Act in conformity with the ,present constitutional position it is proposed to amend sub-section (5) of section 12A of the Food Corporations Act, 1964 so as to do away with the requirement of giving second opportunity of making representation with regard to the penalty proposed to be imposed.3. ft is proposed to avail of the present opportunity to amend sub-section (3) of section 44 of the Act relating to laying of the rules made by the Central Government under section 44 before each House of the Parliament, so as to bring it in line with the Standard Model clause recommended by the Committee on Subordinate Legislation.4. It is also proposed to amend section 45 of the Act relating to power to make regulations so as to enable retrospective effect being given to the regulations. The practice has been to make the same terms and conditions, pay scales, etc., which are applicable to employees of the Government generally applicable to the employees of the Food Corporation. For the purpose of extending the benefit of any revision in the pay scales or in the allowances payable to or the terms and conditions applicable to employees of the Food Corporation from the same date from which those benefits have been given to employees of the Government, it becomes necessary to make the regulations on the subject with retrospective effect. In accordance with the recommendations of the Committee on Subordinate Legislation, provision is being made for laying of regulations before each House of Parliament. It is also proposed to make it clear in the proposed amendment that the power to make regulations with retrospective effect will not be exercised so as to prejudicially affect the interest of any person.5. It is also proposed to add a new section 46 to provide for validating retrospective effect given to the regulations already framed by the Food Corporation under the regulation making power conferred on it by section 45 of the Food Corporations Act, 1964.6. The Bill seeks to achieve the above objects. Gazette of India, 30-4-82. Pt.11 Section 2, Ext.p. 3 (No. 21).Act 36 of 1988. - Section 27 of the Food Corporations Act, 1964. empowers the Food Corporation of India or a State Food corporation established under the Act to take advances or borrow money from the Central Government or from any scheduled bank or from any other hank or financial institution approved by the Central Government in this behalf against stocks of foodgrains or other foodstuffs held by it for the purpose of carrying out its functions under the Act. The provisions of the Act do not permit a Food Corporation borrow funds from other sources or to issue and sell bonds or debentures.2. The Food Corporations do not generate any internal resources. They require funds both for working capital requirements as well as for investment purposes. At present, the funds are being provided by only the Government and the banking section. It is proposed to diversify the sources of financing.3. It is. therefore proposed to amend section on 27 of the Food Corporations Act, 1964 (37 of 1964) to enable a Food Corporation to raise funds, as and when required, for its operational as well as investment requirements by the issue of bonds and debentures and also by borrowings from the Central and State Government institutions or public sector enterprises or bodies or from public or corporate sector, on such terms, and conditions as may he approved by the Central Government.4. The Bill seeks to achieve the above objective. Gazette of India, 21.4-87., Pt. II Section 2 Ext., P. 3 (No. 15).[10th December, 1964]An Act to provide for the establishment of Food Corporations for the purpose of trading in foodsgrains and other foodstuffs and for matters connected therewith and incidental thereto.BE it enacted by Parliament in the Fifteenth Year of the Republic of India as follows:--
