310 REPORT OF THE INDIAN HEMP DRUGS COMMISSION, 1893-94. [CH. XVI.

The danger of relying mainly on the auction system as a check on con-
sumption is that a combination, or the absence of competition, among the vendors
might at any time destroy its efficiency. The fixed duty should therefore be
as high as possible, due regard being paid to the considerations mentioned in
Chapter XIV, paragraph 586. When this is done, the auction of licenses for vend
will come in as a valuable adjustment, and, if properly worked, will indicate
whether the limit of taxation has been reached. If the proceeds of the auction
sales of licenses have a decided tendency to increase, this will be an indication
that the fixed duty will bear an increase.

Control of cultivation.

636. But besides that which results from adequate taxation, another method
of restricting consumption is available to the Gov-
ernment in the limitation of the sources of supply.
And the most effective way of doing this, at all events in the case of ganja, is to
prohibit cultivation of the hemp plant, except under license, and to grant
licenses for cultivation in such a way as to secure supervision and registration of
the produce. Unless this is done, it is impossible to have any idea of the extent
of consumption. The opinions formed from time to time in regard to this
matter in provinces where cultivation is not controlled are mere guesses doomed
to be falsified. It is of the greatest importance that this control should be
exercised. In regard to charas, the only way of limiting the supply is by taxa-
tion, and the conditions of the trade are such that the supply can be completely
regulated by the application of this method. Where the hemp plant grows
spontaneously in abundance, the supply of bhang cannot be regulated, but in
other places there is no reason why its cultivation should not be placed under the
same restrictions as that of ganja, and a direct duty, which must be light in
proportion to the facilities for importing the drug free of charge, imposed. The
subject will be referred to again further on.

Limitation of shops.

637. Another most effective way of reducing the sources of supply is by keep-
ing the number of licensed shops to the lowest limit
compatible with meeting the real demand. The
increase of shops or failure to reduce them has often been pointed out as an error
committed by individual district officers whose aim was too much to raise
revenue. The impropriety of this and its danger cannot be too strongly insisted
upon. The matter is one which should be kept constantly in view by the Local
Governments and by the Government of India.

Artificial checks not desirable.

638. The Commission do not, however, advocate any attempt to restrict the
supply of the drugs by an artificial check, such as
limiting cultivation of ganja or import of charas,
with reference to an ascertained or computed average demand. It is not for the
Government to determine how much of the drugs should be consumed. Its func-
tion is to exert pressure, but not to fix limits; to regulate the conditions, but
not the actual quantity; and it is far better that, subject to those conditions, the
laws of supply and demand should not be interfered with.

Prices of the drugs.

639. The incidence of taxation in different provinces ought not cœteris
paribus to vary greatly. The following table shows
the retail prices per sér prevailing in the different
provinces:—