 bill no 42 of 2006 the produce  cess laws (abolition) bill, 2006 a billto repeal the agricultural produce cess act, 1940 and the produce cess act, 1966be it enacted by parliament in the fifty-seventh year of the republic of india as follows:—short title1 this act may be called the produce  cess laws  (abolition) act, 2006 2 the agricultural produce cess act, 1940 is hereby repealedrepeal of act 27 of 19403 the produce cess act, 1966 is hereby repealedrepeal of act 15 of 1966savings4 (1) the repeal by this act of any enactment shall not,—(a) affect any other enactment in which the repealed enactment has been applied, incorporated or referred to;(b) affect the validity, invalidity, effect or consequences of anything already done or suffered, or any right, title, obligation or liability already acquired, accrued or incurred or any remedy or proceeding in respect thereof, or any release or discharge of or from any debt, penalty, obligation, liability, claim or demand, or any indemnity already granted, or the proof of any past act or thing;(c) affect any principle or rule of law, or established jurisdiction, form or course of pleading, practice or procedure, or existing usage, custom, privilege, restriction, exemption, office or appointment, notwithstanding that the same respectively may have been in any manner affirmed or recognised or derived by, in or from any enactment hereby repealed;(d) revive or restore any jurisdiction, office, custom, liability, right, title, privilege, restriction, exemption, usage, practice, procedure or other matter or thing not now existing or in force10 of 1897(2) the mention of particular matters in sub-section (1) shall not be held to prejudice or affect the general application of section 6 of the general clauses act, 1897, with regard to the effect of repeals5  notwithstanding the repeal of the enactments specified in section 2 and section 3, the proceeds of duties levied under the said enactments immediately preceding date on which the produce cess laws (abolition) bill, 2006  receives the assent of the president,—collection and payment of arrears of duties(i) if collected by the collecting agencies but not paid into the reserve bank of india; and(ii) if not collected by the collecting agencies, shall be paid or as the case may be, collected and paid into the reserve bank of india for being credited to the consolidated fund of india statement of objects and reasonsthe agricultural produce cess act, 1940, inter alia, provides for the imposition of a cess on certain articles such as bones, butter, cereals other than rice and wheat, drugs, fish, fruits, ghee, oil cakes, spices, vegetables, sheep or lamb wool and animal hair, etc, by way of customs duty on export to make better financial provision for the indian council for agricultural research similarly the produce cess act, 1966 provides for the imposition of cess on certain produce such as lac, refuse lac produced in india and cashew kernel when they are exported beyond the limits of india, for the improvement and development of the methods of cultivation and marketing of the said produce2 the cess under these acts is a tax on exports in the present national and international context, it is bad economics to tax exports from a national perspective, agricultural exports are being seen as a means to augment farm incomes exports are being incentivised through schemes, which involve foregoing of revenue taxing some of these very exports, which are being incentivised, is inconsistent and illogical from the international perspective also, it seems irrational on our part to levy a tax on agricultural exports, when many other countries are aggressively promoting their agricultural exports through large subsidies these subsidies impact adversely on the competitiveness of our exports continuance of a cess on agricultural produce will only make the exports more expensive and uncompetitive3 the cess levied under the acts referred to above is unambiguously an export taximposition of such an export tax is clearly anomalous and runs counter to policy  it reduces competitiveness of agricultural exports and is plainly unjustifiable  the only action consistent with government's avowed policy is to do away with all cesses on agricultural exports collected under above said statutes4 the enactments levying the cess do not contain any provision for grant of exemptionit is, therefore, proposed to repeal the agricultural produce cess act, 1940 and the produce cess act, 1966 to abolish cess on the export of agricultural products levied under the respective acts5 the bill seeks to achieve the above objectsnew delhi;sharad pawarthe 28th march, 2006———— president's recommendation under article 117 and 274 of the constitution of india————[copy of letter no 13011/7/05-trade, dated the 20th april, 2006 from shri sharad pawar, minister of agriculture and consumer affairs food and public distribution to the secretary-general, lok sabha]the president, having been informed of the subject of the proposed cess acts repealing bill, 2006 recommends to the house the introduction under articles 117(1) and 274(1) and consideration of the bill under article 117(3) of the constitution financial memorandumthe proposed bill provides for repealing of the agricultural produce cess act, 1940 and the produce cess act, 1966 to abolish cess on the export of certain agricultural produces levied under the respective acts2 no recurring or non-recurring expenditure is involved in the administration of the proposed legislation lok sabha———— a billto repeal the agricultural produce cess act, 1940 and the produce cess act, 1966————(shri sharad pawar, minister of agriculture and consumer affairs, food and public distribution)mgipmrnd—423ls(s5)—100506