Notes

Inter-State Trade and Commerce

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Inter-State Trade and Commerce

Articles 301 to 307 in Part XIII of the Indian Constitution deal with trade, commerce, and intercourse within the territory of India.

Overview:

  • Article 301: Declares that trade, commerce, and intercourse throughout India shall be free, aiming to remove barriers between states and encourage the free flow of trade and commerce.

Restrictions and Provisions:

Parliamentary Authority:
  • Parliament can impose restrictions on trade, commerce, and intercourse between states or within a state in the public interest.
  • However, Parliament cannot favor one state over another or discriminate between states, except in cases of goods scarcity.
State Legislative Authority:
  • State legislatures can impose reasonable restrictions on trade, commerce, and intercourse within the state or with other states in the public interest.
  • A bill for this purpose can only be introduced in the state legislature with prior approval from the President.
  • State legislatures cannot favor one state over another or discriminate between states.
Taxation and Discrimination:
  • State legislatures can impose taxes on goods imported from other states or union territories, provided they are taxed similarly to goods manufactured in the state.
  • This provision prohibits discriminatory taxation by the state.
Subject to Nationalization Laws:
  • The freedom under Article 301 is subject to laws providing for monopolies in favor of the Centre or the states, also known as nationalization laws.