Karnataka High Court upholds mandatory use of jute bags for sugar packaging

The High Court of Karnataka has dismissed petitions filed by the South Indian Sugar Mills Association and the Indian Sugar Mills Association challenging government rules that require sugar mills to pack 20% of their production in jute bags.

Under the Jute Packaging Materials (Compulsory Use in Packing Commodities) Act, 1987, the foodgrains industry must use jute bags for 100% of its packaging, while the sugar industry is required to use jute bags for 20% of its production.

The petitioners argued that the rules increase costs, as using jute bags adds an estimated USD 76-million annually compared to recyclable plastic packaging. They said the requirements restrict their business because bulk consumers, including large food and beverage companies, are reluctant to accept sugar delivered in jute bags due to concerns about hygiene and contamination.

The associations also raised the issue of jute batching oil, which is used in processing jute fibres. They contended that the oil could present health hazards, citing reports that suggest it may be carcinogenic. The petitioners claimed that governments in Punjab, Haryana, and Andhra Pradesh had expressed concerns about the use of the oil.

The court ruled that these issues should be examined by the Standing Advisory Committee under the Act. It held that the 20% requirement was neither arbitrary nor unreasonable, noting that the Supreme Court had earlier upheld a rule mandating 100% jute packaging for sugar.

The Additional Solicitor General submitted that the policy was approved by the government after deliberations and was in the interest of farmers.

Various news reports show that the government, led by Prime Minister Narendra Modi, has in recent years stepped up enforcement of the rule to encourage the jute industry, warning of penalties for non-compliance.