The power of Parliament to impose, by law, such restrictions on the freedom of trade, commerce or intercourse between States as may be required in the public interest is given by:

Article 302 says that 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.

The general rule (Article 301):

• Article 301 declares that, subject to the other provisions of Part XIII, trade, commerce and intercourse throughout the territory of India shall be free.
• This freedom covers not only trade between states but also trade within a state.
• It is meant to make India a single economic unit, without barriers between states.

Restrictions on the freedom:

Article 302: Parliament can impose restrictions in the public interest.

Article 303: Parliament cannot give preference to one state over another, or discriminate between states, by any law relating to trade and commerce, except when it declares that this is necessary to deal with a scarcity of goods in any part of India.

Article 304: A state legislature can impose taxes on goods imported from other states, if similar goods produced in the state are taxed in the same way; it can also impose reasonable restrictions in the public interest, but a bill for this purpose needs the previous sanction of the President.

Article 307: Parliament can appoint an authority to carry out the purposes of these provisions; no such authority has been appointed so far.

Examples of restrictions:

Restrictions on the movement of essential goods during shortages, or of livestock and plants to prevent the spread of diseases.

The courts on freedom of trade:

The Supreme Court has held that regulatory measures and compensatory taxes (taxes charged for the use of facilities such as roads) do not violate the freedom of trade.

Part XIII:

Articles 301 to 307 together form Part XIII of the Constitution (Trade, Commerce and Intercourse within the territory of India).

Why not the other options?

• ✗Article 301 declares the general freedom of trade; Article 304 deals with restrictions by the states; Article 307 with the appointment of an authority.