The Constitution of India
Article 302
Power of Parliament to impose restrictions on trade, commerce and intercourse
Parliament may by law impose such restrictions on the freedom of trade, commerce or intercourse between one State and another or within any part of the territory of India as may be required in the public interest.
Why this exists
Article 302 exists because the Constitution guarantees free trade and commerce across India under Article 301, but this freedom cannot be absolute. Governments sometimes need to step in — for example, during shortages, health emergencies, or to regulate essential goods — so the framers gave Parliament the power to impose reasonable restrictions when the wider public interest demands it, balancing economic freedom with practical governance needs.
How courts read it
The Supreme Court, notably in the Atiabari Tea Co. case (1961) and later in Automobile Transport (Rajasthan) Ltd. v. State of Rajasthan (1962), clarified that Article 301's freedom of trade is not unlimited, and that regulatory measures (like reasonable taxes for using roads) don't automatically violate it. Article 302 was read alongside Articles 303 and 304 to establish that Parliament's restrictive powers must serve genuine public interest and not be used to unfairly favor one state over another.
Common misconceptions
- Myth: Article 302 lets Parliament ban trade between states whenever it wants.
Fact: Courts have made clear that any restriction must be genuinely justified by public interest, and cannot be arbitrary or discriminatory against particular states (see Articles 303–304). - Myth: Only state governments can regulate trade within their borders.
Fact: Article 302 specifically empowers the central Parliament, not state legislatures, to impose such restrictions when necessary for the public interest.