1.JUDICIARY IN TURMOIL (THE HINDU)

2.THE KEY DECISION OF UNION CABINET (THE HINDU AND THE ECONOMICS TIMES)

 

1.Judiciary in turmoil (The Hindu)

Synoptic line: It throws light on the issue of the diminishing the image of the judiciary. (GS paper III and IV)

Overview

  • It was indeed an “extraordinary event in the history of any nation”, as four senior judges of the Supreme Court held a press conference to address what they perceive as a crisis in the judiciary.
  • The incident exposed an unprecedented level of dissension in the top echelons of the judiciary. It is regrettable that the banner of revolt has been raised in such a public way against the Chief Justice of India, Dipak Misra. Regardless of who is right in the current dispute over the administrative functioning of the CJI, the reverberations of what took place will not easily subside and will be felt for a long time to come.
  • The germ that led to the outbreak of the current conflict could be the controversial Prasad Education Trust case, in which the petitioners alleged that some individuals were plotting to influence the Supreme Court.

Assessment

  • Over the last few months that the highest court was in a state of ferment; the question is whether it could have been handled internally rather than be dragged into the open like this. Although it is clear that their grievances are rooted in their perception that Justice Misra is misusing his administrative powers to assign cases “selectively”, disregarding conventions on allocation of judicial work.
  • It is there to accept the rule that the Chief Justice alone can decide the composition of Benches and allot judicial work, they allege that Justice Misra is departing so far from set conventions that it would have “unpleasant and undesirable consequences”, ultimately casting a doubt on the integrity of the institution itself.

What is the case?

  • The original case pertains to a Medical Council of India issue. The MCI had denied permission to Prasad Education Trust, an institution based in Lucknow to run a medical college. The Trust then moved court and obtained an order in its favour. The CBI raided several people related to the case based on allegations that there was collusion between the Trust and the judiciary.
  • These raids and further investigation led to the arrest of former Odisha High Court judge I.M. Quddusi and others. Justice Quddusi was released on bail. The Campaign for Judicial Accountability and Reforms, an NGO represented by Mr. Bhushan filed a petition in the seeking an independent probe into the incident. Advocate Kamini Jaiswal also moved a similar petition.
  • A two-judge Bench headed by Justice Chelameswar referred the case to a five-judge Constitution Bench. The petitioners did not want Chief Justice of India Dipak Misra to be on this Bench since he had handled MCI cases before.
  • Judicial work is primarily allocated based on a roster, and individual cases are allotted to Benches based on the category under which they fall. Once the roster is fixed, the CJI should ordinarily see that it is duly followed.

Way ahead

  • There is need that the Chief Justice must convene a meeting of the full court and give them a patient and careful hearing. Disapproval of the form of their protest must not cloud the substance of their grievances. That four senior Supreme Court judges could have been pushed to take such a drastic and unprecedented step suggests that the differences were allowed to fester and divisions allowed to run deep.
  • This institution has illumined national life for more than six decades, but a dark shadow hangs over it now. It is a moment for collective introspection, so that it should not diminish the image of the judiciary.

Ques-An internal rift in the judiciary is far more serious. It poses the risk of diminishing the image of the judiciary and the esteem it enjoys in society. Elaborately discuss in the context of controversial Prasad Education Trust case.

 

2.The key decision of Union Cabinet (The Hindu and The Economics times) 

Synoptic line: It throws light on the issue of privatisation of Air India and 100% FDI in the single brand retail. (GS paper III)

Overview

  • The government has amended foreign direct investment (FDI) rules for the fourth time in three years to liberalize the investment regime for single-brand retail, real estate brokerage, aviation and power exchanges.
  • The key decision among these is the move designed to expedite the strategic divestment in Air India, the Cabinet had decided to open up the national carrier for foreign direct investment (FDI) up to 49 percent under the approval route. The present rules allow foreign airlines to invest under the government approval route in the capital of Indian airline companies up to the limit of 49 percent of their paid-up capital, which is, however, not applicable to Air India.

Air India disinvestment

  • The Cabinet Committee on Economic Affairs had already given its nod for a strategic disinvestment of the airline. The relaxation in ownership norms clears the decks for possible bidders such as the Singapore Airlines-Tata combine and Jet Airways with its overseas equity and route partners to make a more detailed commercial assessment of the investment opportunity the state-owned flag carrier presents.
  • The airline is under a massive debt burden of Rs 50,000 crore, had posted an operating profit of Rs 105 crore in 2015-16, and is expected to report an improved operating profit margin for the last fiscal. The national carrier got a new lease of life in April 2012, when the then UPA government approved Rs 30,000-crore turnaround and financial restructuring package spanning up to 2021.
  • Though the Centre of Indian Trade Unions (CITU) had denounce the decision of the government to allow 49 per cent foreign direct investment (FDI) in Air India, and said it was aimed at expediting the privatisation of the national carrier.
  • CITU mentioned that the government is taking the plea of huge loss Air India is being burdened with to justify its move, but the Centre is seeking to hide the fact that the carrier has been pushed to this situation not because of its management’s failure but owing to “imposition of disastrous decisions on the company by successive governments at the Centre”. He also highlighted the fact that “despite such reckless and imprudent misadventure”, Air India has struggled to come back to operating profit for last three years.

FDI in retail

  • The other crucial decision was taken by the Cabinet is to put 100% FDI in Single Brand Retail Trading under the ‘automatic’ route, accompanied by the long-sought relaxation of mandatory local sourcing norms. This had been a major issue with potential investors including Apple, which had repeatedly urged the government to take a more benign view given the level of technological advancement incorporated in its products and the difficulty in finding local sources of supply at the requisite scale.
  • The 30% local sourcing rules in single-brand retail continue to be a deterrent for investors, especially in industries in which India doesn’t already have evolved manufacturers. The relaxation for companies with “state-of-the-art” or “cutting edge” products is unclear at present because of confusion about what these terms mean.

Way ahead

  • Amidst the criticism, the decision came late, as the early decision would have helped, given the sector’s potential for job-creation and technology upgradation. The Single-brand retail has been open to 100% FDI since 2011; the main draw for investors will be multi-brand retail this has been pending due to a fear of retaliation from kirana store owners.
  • By allowing 49% FDI in Air India, the government will likely get more bidders and hence a better valuation. But it should clarify, like in the Maruti Suzuki case that it will not interfere in the management after the disinvestment.

Ques- Critically analyse the government’s move to ease FDI rules for single-brand retail, real estate brokerage and aviation sector.