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India Legal 19 November 2018


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Under Siege
RBI governor Urjit Patel comes under intense pressure from the Executive and the Transparency Watchdog. The centre has invoked a section of the RBI Act never used before, leading to a stalemate that could have serious financial and political consequences

Published in: News & Politics
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India Legal 19 November 2018

  1. 1. NDIA EGALL STORIES THAT COUNT ` 100 I November19, 2018 Under SiegeRBIgovernorUrjitPatelcomesunderintense pressurefromtheExecutiveandthe TransparencyWatchdog.Thecentrehasinvoked asectionoftheRBIActneverusedbefore, leadingtoastalematethatcouldhaveserious financialandpoliticalconsequences Obsolete Laws: Time for revision
  2. 2. UPREME Court judge Justice Madan B Lokur today occupies a singularly note- worthy position in addition to his exalt- ed status in the highest court of the land. As the second seniormost judge, he now replaces his esteemed predecessor, Chief Justice of India (CJI) Ranjan Gogoi, as the execu- tive chairman of NALSA. This development, as it should, merits the goodwill and blessings of all Indians who hold dear the concept of equal and speedy justice for all. Earlier, CJI Gogoi, while addressing a youthful audience on the issue of access to justice, had already set the tone for a future course of action: “I am trying to make justice accessible while act- ing as executive chairman of National Legal Ser- vices Authority (NALSA) for the last one year. I do not know how far I have succeeded. A different approach and a different thinking are needed for it and it will be forthcoming in the near future.” In pursuance of this laudatory goal and conti- nuity of approach, the India Legal Research Foundation (ILRF) volunteers its participatory support to Justice Lokur and NALSA. It may be of help to take a cue from a Commonwealth Human Rights Initiative (CHRI) report titled “Hope Behind Bars”. Some of the key findings of the CHRI report are that per capita spending on legal aid in India is only `0.75 (one of the lowest in the world), 14 percent of the total funds allocated to state legal services authorities remain unutilised and the legal aid scheme administered by NALSA is plagued by lack of accountability and quality. The report further said that almost 80 percent of India’s population is eligible for legal aid and while the NALSA framework is quite detailed, ac- tual delivery falls short. The statistics maintained by NALSA convey a similar message—since its inception in 1987, only 1,67,11,477 people have benefited through various legal services authorities and from April 2017 to March 2018, just 8,22,856 people. The aims of NALSA and ILRF converge. Set up under the National Legal Aid Services Autho- rities Act, 1987 (NALSA Act), NALSA is a central authority which works to provide legal aid to eli- gible litigants, establish legal aid clinics and or- ganise Lok Adalats. The ILRF is a legal aid foun- dation which provides free and high-quality legal aid to those unable to afford it. It is part of the ENC media network, which produces India Legal magazine, India’s first politico-legal publication. It is a one-of-its-kind journalistic endeavour focusing on current issues of governance, law and policy, and constitutional contours. ENC’s broad- cast arm is the path-breaking APN News, the 24x7 national TV channel. These media outlets cover day-to-day court proceedings from all across India, with in-depth analyses by legal experts. We partner with NLU, Delhi, and NALSAR, Hyderabad, for undertaking socially beneficial projects and analysing our legal system along with recommending remedies. The ILRF has been active in helping the downtrodden sections of society from the day it started working towards attaining the constitutional objective of providing free legal aid in the spirit of Article 14 and Article 39A of the 42nd Amendment. During the last two and a half years, we have successfully worked on thousands of applications. We have a team of volunteers in different states handling a variety of grievances from ordinary people who have nowhere else to turn. They also provide free legal assistance through their net- work of lawyers to the needy. In addition, the ILRF campaigns actively to promote the rights, working environment and aspirational potential of women. It operates a popular pro bono monitoring programme in which successful women from across professions share their experiences and wisdom to eliminate gender bias. The ILRF’s maiden conclave, focusing on the A COMMON MISSION Inderjit Badhwar Letter from the Editor S 4 November 19, 2018 TheaimsofNALSA andILRFconverge. TheILRFisalegal aidfoundation whichprovidesfree andhigh-quality legalaidtothose unabletoaffordit.It hasbeenactive inhelpingthe downtrodden sectionsofsociety fromthedayit startedworking towardsattaining theconstitutional objectiveof providingfree legalaid.
  3. 3. | INDIA LEGAL | November 19, 2018 5 Twitter: @indialegalmedia Website: Contact: theme of “Access to Justice” was held in Ranchi in July 2016. It was inaugurated by Droupadi Mur- mu, the governor of Jharkhand. The Chief Justice of Jharkhand High Court, Virender Singh, was the guest of honour. It was attended by justices of the state High Court, retired judges, eminent law- yers, former presidents of the Supreme Court Bar Association, law students and leading opinion- makers. The event received nationwide attention and media coverage. W ith this editorial, we are taking the lib- erty of extending our services to NALSA through any joint initiatives such as seminars, dissemination of articles, spe- cial media events and coverage, teaching opportu- nities and outreach programmes they may wish to suggest. Here’s the bitter truth about India’s ongoing battle for justice. It is out of reach for the coun- try’s teeming millions. We will become the voice of voiceless litigants. One of the greatest gifts of freedom and liberty endowed to us by our Founding Fathers is the Access to Justice. These may be simple sounding words. But their beauty and spirit lie in their very simplicity. Access is another word for the “right to entry”, or the “right to use”. Justice means fairness, impartiality, righteousness, even-handedness, fair dealing, honesty, integrity. As a wise jurist once said, it is “from this juridical principle of natural justice that human beings can derive the moral ammunition to strive for what each individual craves day by day: A Life of Dignity.” Ours should be a collective effort of taking the law to the people. If, in accessing justice, the com- mon man has to encounter barriers and impedi- ments, the equality clause in our Constitution becomes no more than a promissory note! A paper tiger! So, in a judiciary where access is gagged and the institutions which are responsible do nothing to remove the obstacles, such a system ceases to be an independent judicial system. As early as 1956, the apex court while interpreting Article 14 decided that our Constitution is not meant only for the elite, it is also for “the butcher, the baker and the candlestick maker”. However, there is much more to be done in this regard and the ILRF has taken a small but necessary step in embarking upon this arduous journey—an onerous task with the clear vision of realising the first mission of Mahatma Gandhi: “To wipe every tear from every eye.” NOBLE MISSION (Clockwise from above) Supreme Court judge Justice Madan B Lokur, the executive chairman of NALSA; Jharkhand Governor Droupadi Murmu lights the ceremonial lamp at the ILRF’s maiden conclave at Ranchi in 2016 in the presence of Chief Justice of the Jharkhand High Court Justice Virender Singh; CJI Ranjan Gogoi was the executive chairman of NALSA before Justice Lokur
  4. 4. ContentsVOLUME XII ISSUE1 NOVEMBER19,2018 OWNED BY E. N. COMMUNICATIONS PVT. LTD. A -9, Sector-68, Gautam Buddh Nagar, NOIDA (U.P.) - 201309 Phone: +9 1-0120-2471400- 6127900 ; Fax: + 91- 0120-2471411 e-mail: website: MUMBAI: Arshie Complex, B-3 & B4, Yari Road, Versova, Andheri, Mumbai-400058 RANCHI: House No. 130/C, Vidyalaya Marg, Ashoknagar, Ranchi-834002. LUCKNOW: First floor, 21/32, A, West View, Tilak Marg, Hazratganj, Lucknow-226001. PATNA: Sukh Vihar Apartment, West Boring Canal Road, New Punaichak, Opposite Lalita Hotel, Patna-800023. ALLAHABAD: Leader Press, 9-A, Edmonston Road, Civil Lines, Allahabad-211 001. Editor Inderjit Badhwar Senior Managing Editor Dilip Bobb Deputy Managing Editor Shobha John Executive Editor Ashok Damodaran Contributing Editor Ramesh Menon Deputy Editors Prabir Biswas Puneet Nicholas Yadav Associate Editor Sucheta Dasgupta Senior Writer Vrinda Agarwal Art Director Anthony Lawrence Deputy Art Editor Amitava Sen Senior Visualiser Rajender Kumar Photographers Anil Shakya, Bhavana Gaur Photo Researcher/ Kh Manglembi Devi News Coordinator Production Pawan Kumar CFO Anand Raj Singh Sales & Marketing Tim Vaughan, K L Satish Rao, James Richard, Nimish Bhattacharya, Misa Adagini Circulation Team Mobile No: 8377009652, Landline No: 0120-612-7900 email: PublishedbyProfBaldevRajGuptaonbehalfofENCommunicationsPvtLtd andprintedatAcmeTradexIndiaPvt.Ltd.(UnitPrintingPress),B-70,Sector-80, PhaseII,Noida-201305(U.P.). Allrightsreserved.Reproductionortranslationinany languageinwholeorinpartwithoutpermissionisprohibited.Requestsfor permissionshouldbedirectedtoENCommunicationsPvtLtd.Opinionsof writersinthemagazinearenotnecessarilyendorsedby ENCommunicationsPvtLtd.ThePublisherassumesnoresponsibilityforthe returnofunsolicitedmaterialorformateriallostordamagedintransit. AllcorrespondenceshouldbeaddressedtoENCommunicationsPvtLtd. Senior Content Writer Punit Mishra (Web) 6 November 19, 2018 Coming to a Head With the government deciding to invoke Section 7 of the Reserve Bank of India Act, the central bank governor, Urjit Patel, is at the receiving end from the Executive, as well as from the Central Information Commission LEAD 12 It’s all about the Money The centre and Election Commission must respond to a public interest litigation seeking immediate steps to tackle bribery and use of black money during polls SUPREMECOURT 18 Walking with the Lord A lawsuit in the Delhi High Court has opened the doors for disabled people to go on the yearly Haj pilgrimage, a privilege denied to them earlier COURTS 20
  5. 5. Playing to the Galleries REGULARS Followuson Twitter:@indialegalmedia | INDIA LEGAL | November 19, 2018 7 Cover Design: ANTHONY LAWRENCE Cover Photo: UNI Ringside............................8 Courts ...............................9 Delhi Durbar ...................10 International Briefs..........37 Media Watch ..................49 Satire ..............................50 Protests by India over a new bus service between Lahore and Kashgar are part of a plan to present a tough image of the Modi government ahead of polls 46 Down to Business While India’s Doing Business Index has registered an uptick, for things to sub- stantially improve, conflicting regulations and stifling bureaucracy have to go 34 ECONOMY STATES The Kerala High Court order in a case involving ex-minister KM Mani is a thumbs up to former chief minister, VS Achuthanandan, in his battle against corruption 40Raising the Bar Promises and Policy The government has acknowledged the need to set targets with regard to reducing particulate matter in the air, but a credible strategy is the need of the hour 30 Proof of Conspiracy A shocking admission by a witness in the Sohrabuddin Sheikh fake encounter case shows yet again that BJP leader Haren Pandya’s death was a political murder A Statue for Ram 44 Uttar Pradesh Chief Minister Yogi Adityanath’s announcement in Ayodhya is a bid to quell discontent among bhakts over the promised temple there Not Cast in Stone The apex court has said that a Scheduled Caste person in one state cannot avail of reservation benefits in another 21 Restraint Is Key The Delhi High Court lays down directions to stop indiscriminate use of the powers of preventive arrest by magistrates and cops 22 Cry of the Forest An expressway through the verdant Aravali Biodiversity Park will destroy it. But a petition in the top court could stymie this plan 26 ENVIRONMENT Statutory Warning The Madras High Court’s order in the case of a minor eloping with an older, married man is hard to implement 24 Not Common Sense Close to 3,000 British-enacted, arcane laws exist in our statute books. These can either be discarded or modified 38 SPOTLIGHT 42 GLOBALTRENDS
  6. 6. 8 November 19, 2018 “ RINGSIDE “People have been demanding for long that Ahmedabad be renamed as Karna- vati. The government is considering this demand. Consul- tation process has been started...we will take a concrete step before Lok Sabha elections.” —Gujarat Chief Minister Vijay Rupani to the media in Gandhinagar “It is our responsibil- ity to come together and protect this nation and save democracy, the Constitution and institutions....” —Andhra Pradesh CM N Chandrababu Naidu on his efforts to forge Opposition unity ahead of the 2019 polls “Notebandi impacted every single person. Small and medium businesses...are yet to recover from the demonetisation shock....the economy continues to struggle to create enough new jobs for our youth....” —Former Prime Minister Manmohan Singh on the second anniversary of demonetisation “Ayodhya is a sym- bol of our ‘aan, baan aur shaan’ (honour, pride and prestige). Nobody can do injustice to Ayodhya.” —Uttar Pradesh Chief Minister Yogi Adityanath at the Deepotsav celebra- tions in Ayodhya after announcing that it will be known as Faizabad district “Why did Maneka Gandhi not raise any questions when Shafath Ali Khan killed a tiger in her constituency...?... why is she silent on villagers...lynching a tiger to death in UP?” —Maharashtra Minister Sudhir Mungantiwar on Maneka's tweets against the killing of a tiger in the state “This was the first step. There are 28 Lok Sabha seats. We’ll work with the Congress party to win all of them; that is our goal....” —Karnataka Chief Minister HD Kumara- swamy on the wins registered by the JD(S)-Congress in the Karnataka bypolls “Now we will not seek anything from anyone, it will be a fight. We will create such a condition in front of Chautala sahib that he will be compelled to ask Dushyant to return to the party.” —INLD leader Ajay Singh Chautala, on Om Prakash Chau- tala expelling his sons from the party “I say that if anybody goes to the police station to register his complaint, can we not say four good things to him? If there is someone who has been wait- ing for one or two hours, and we see that he is tired, can we not offer him one glass of water? Will we become small…. Politeness does not mean that a man cannot be decisive.” —Union Home Minister Rajnath Singh while addressing the Delhi Police at a function
  7. 7. The Supreme Court allowed the viewing of GD Agarwal’s body, the environment engineer and activist who died in Rishi- kesh following an indefinite hunger strike for a clean Ganga. Since the activist’s death, his followers had been demanding viewing of his body, lying in the mor- tuary at All India Institute of Medical Sciences (AIIMS), Rishikesh, leading to a peti- tion in the Supreme Court. The apex court allowed viewing of his body within the hospital premises for 10 consecutive Sundays in batches of 10-50 people. A former IIT professor, Agar- wal, also known as Swami Sanand, died on October 11 following 109 days of hunger strike, and accord- ing to his wish, his body was donated to AIIMS, Rishikesh for research and teaching purposes. Courts | INDIA LEGAL | November 19, 2018 9 Twitter: @indialegalmedia Website: Contact: —Compiled by India Legal Team Plea against Shivaji statue dismissed APIL has been filed in the Supreme Court challenging the Ministry of Information and Broad- casting (I&B)’s circular which advised the media to refrain from using the word “Dalit”. The PIL co- ntends that the circular is ultra vires, arbitrary, irra- tional and violative of Arti- cles 14, 15, 19 and 21 of the Constitution. The cir- cular, issued by the I&B ministry on August 7, states that the constitu- tional term, ”Scheduled Caste” in English and its appropriate translation in other national languages, should alone be used for all official transactions, matters, dealings, etc while referring to SCs. The Supreme Court has given its nod for a separate High Court for Andhra Pradesh (AP), which will be known as the Telangana High Court and will start functioning from Janu- ary 1, 2019. The new court, which will be the 25th high court in the co- untry, will temporarily function from a makeshift building till the perman- ent structure is built in AP’s de facto capital, Amaravati. This move is in line with the AP Reorganisation Act, 2014, which resulted in the bifurca- tion of AP and creation of Telangana, and has a provision for separate high courts for the two states. Andhra Pradesh to get own High Court The Supreme Court observed that sex workers also have a right to refuse their services and seek redressal on being forced by any person. The apex court made these remarks while hearing an appeal against a Delhi High Court order passed in 2009 which acquitted four men accused in a gangrape case. The four accused had earli- er been held guilty by a lower court and sen- tenced to 10 years’ imprisonment. Reversing the High Court order and upholding the order of the lower court, the Supreme Court said that: “Even assuming that the woman was of easy virtue, she has a right to refuse to have sexual intercourse with anyone....” While passing the conviction order, the trial court had stated that: “Even if the allegations of the accused that the woman is of immoral character are taken to be correct, the same does not give any right to the accused persons to commit rape on her against her consent.” The Bombay High Court refused to stay the construction of the proposed Chhatrapati Shivaji Maharaj memorial, saying that “the decision to have a project of this nature is a policy decision taken by the state”. The bench of Chief Justice Naresh H Patil and Justice GS Kul were considering three PILs seeking court intervention against the construction of the proposed memorial in the Arabian Sea at Mumbai. The bench also noted that: “The priorities of the public need are matters which lie completely in the domain of the state government.” Even sex workers have a right to say no: SC PIL against gag order on using the word “Dalit” SC hears plea on Ganga activist’s mortal remains
  8. 8. 10 November 19, 2018 An inside track of happenings in Lutyens’ Delhi All ministers routinely send out Diwali greeting cards, nowadays on social media, to all and sundry and it is usually done by a member of their staff. The one that stood out this time was because of the politically incorrect nature and the office of the sender. It was sent out by Law Minister Ravi Shankar Prasad and the bottom half of the image had visuals of rockets while the badly worded greeting itself men- tioned: “Presents to share success, firecrackers to burn evils (sic), Sweets to sweeten suc- cess…” Considering that it is the Supreme Court which is clamping down on the use of fire- crackers in NCR in the light of danger- ously high pollution levels, and he is the Law Minister, such encouragement on the use of firecrackers is both crass and insensitive, not to mention in defiance of the stand taken by the apex court. In all probability, the electronic card was chosen by one of his staff, but if it was sent without the minister getting a preview, the blame is equally his. DIWALI PROMOTION The head that is most uneasy in India right now belongs to RBI Governor Urjit Patel. His differences with the Modi government and the finance ministry headed by Arun Jaitley appear to have reached breaking point. The government and the RBI have been at loggerheads for over a month now over the question of the central bank’s autonomy. It surfaced when one of the RBI deputy governors said in a speech that undermining the central bank independ- ence could be “potentially catastrophic” and has gone downhill since with the gov- ernment, in poll mode, pressing for a relax- ation of curbs on lending and also wanting access to a large chunk of the RBI’s sur- plus reserves. Now, the buzz in the corridors of North Block is that Patel will announce his resig- nation at the next board meeting of the central bank later this month, and the government is shortlisting an IAS officer to replace him. Two names are doing the rounds—Shaktikanta Das and SEBI chief Ajay Tyagi. Das seems to have the edge, having served as Economic Affairs Secretary and Revenue Secretary. He is a member of the 15th Finance Commission of India and India’s Sherpa to the G-20. If Urjit steps down, it will be his- tory’s lessons unlearnt —Patel’s predeces- sor Raghuram Rajan also fought for RBI autonomy and paid the price. The week gone by saw a rare swift- ness on the part of the Centre in issu- ing the notification for appointment of four judges to the Supreme Court— just 48 hours after the Collegium had recommended these elevations. The urgency with which the appointment of Justices Hemant Gupta, Ajay Rastogi, MR Shah and R Subhash Reddy to the top court was cleared even left Chief Justice Ranjan Gogoi “very shocked and in awe”. While the government was brisk with the Supreme Court appointments, it harked back to its stalling tactics when it came to almost simultaneous- ly made recommendations for appointing judges to various high courts. There are two instances that have created a buzz in the power corridors—both of which prove that Chief Justice Gogoi hasn’t compro- mised his rebellious streak since assuming office. The first concerns the centre’s decision of notifying the elevation of Justice AS Dave as acting Chief Justice of the Gujarat High Court, on November 1, after its chief justice, R Subhash Reddy, was moved to the Supreme Court. Justice Dave was second in seniority among the puisne judges of the court and, as per tradi- tion, the second senior-most judge, Justice AA Kureshi, should have taken over from Justice Reddy. Sources say, CJI Gogoi promptly wrote to the Union law ministry making it clear that the government’s “highly arbitrary decision” was against conventions of the judiciary. In an informal interaction with the media the next morning, CJI Gogoi termed the notification about Justice Dave “a mistake”. Hours later, the Centre issued a fresh notification naming Justice Kureshi as acting chief justice of the Gujarat High Court. The CJI has now reportedly sent a let- ter to the centre making his displeas- ure known over the increasing trend of the government splitting up recom- mendations made by the Collegium— approving certain names while with- holding others. TAKING A TOUGH STAND THE HOT SEAT
  9. 9. | INDIA LEGAL | November 19, 2018 11 Twitter: @indialegalmedia Website: Contact: Delhi Durbar Much is being made of the Sardar Patel statue inaugurated last week by the prime minister and the world record breaking height. Now, the con- troversy around the approximately `3,000 crore cost is starting to emerge. First, a Conservative Party British MP objected to the UK giving India loans. “To take 1.1 billion pounds in aid from us, and then spend 330 million pounds on a statue is total nonsense. It is the sort of thing that drives people mad,” MP Peter Bone said, referring to Britain’s donation of over 1.17 billion pounds (around `9,492 crore) to India as foreign aid in the last five years. In India, the Comptroller and Auditor General (CAG) has questioned the decision of using CSR funds of PSUs to finance the statue. The CAG report mentions that the Gujarat government organisa- tion responsible for the project approached Indian Oil Corporation, ONGC, Bharat Petroleum, Oil India Corporation, GAIL, which, according to CAG, contributed close to `150 crore (other estimates are much high- er), and added that “contribution to this project does not qualify as CSR activity”. FINANCING THE SARDAR MARRIAGE PARTY After a fairly long spell in comparative political obscurity, former union minis- ter Jairam Ramesh seems to have been restored to favour in the ever- changing Congress hierarchy. Being Ramesh, he had used his period of exile to work on a book on Mrs Gandhi (Intertwined Lives: PN Haksar and Indira Gandhi), and it has done his prospects no harm. His return is to a position of pre-eminence—he has been put in charge of coordination for the team preparing for the 2019 Lok Sabha elections. His return has already created waves and some con- troversy. The fact that the role of Divya Spandana who was heading the party’s social media cell, was down- graded shortly after Ramesh’s eleva- tion, is no coincidence. He is said to be behind Nikhil Alva, son of veteran Congress Karnataka leader Margaret Alva, being put in charge of Rahul Gandhi’s Twitter handle, a job Spandana was doing earlier. Ramesh is also from Karnataka and is said to have joined hands with the party’s media in charge, Randeep Surjewala, who wants the social media cell to be part of the overall media division and not a separate unit. It may be recalled that Ramesh fell out of Sonia Gan- dhi’s favour after his injudicious remark about the Congress facing an existential crisis. In politics, there are no permanent exits. A crucial factor in the forthcoming Lok Sabha polls will be the political align- ments in India’s largest state, Uttar Pradesh. Despite Amit Shah’s bluster, current indications are that if Akhilesh Yadav’s Samajwadi Party and Mayawati’s Bahujan Samaj Party join hands, it could reduce the BJP’s num- bers to single digits (it currently holds 73 seats out of 80). The two former rivals have been negotiating quietly and a late night meeting at the farm- house of a businessman known to both, on the outskirts of Lucknow, seems to have firmed up the alliance. The meeting was ultra secret, so much so that both Akhilesh and Mayawati left their security behind. Mayawati wanted more seats than Akhilesh was willing to concede but at the end of the three-hour meeting, a deal was reached, with a core group representing both sides assigned to hammer out the final tally. The duo also agreed not to put up candidates in Rae Bareli and Amethi. The alliance agreement will be announced once the final seat share is agreed upon, but it is now a matter of time, not ego. BACK IN FAVOUR
  10. 10. Lead/ RBI-Government Tussle HE war of words between the Reserve Bank of India (RBI) and the government has just got sharper. RBI Governor Urjit Patel rep- ortedly stood firm against the finance ministry’s demands for the transfer of `3.6 lakh crore out of its con- tingency reserves and relaxation of its regulatory curbs on State-owned banks which are reeling under the impact of a huge stack of unrecoverable loans. In fact, tension between the govern- ment and the RBI has reached such a point that the former has reportedly initiated steps to invoke its powers under Section 7 of the RBI Act of 1934. This is the first time the government is exercising its powers under Section 7. It is a provision under which the gov- ernment can give directions to the RBI to take certain actions “in the pub- lic interest”. Almost as a coincidence, Patel received a show cause notice from the Central Information Commission (CIC) for defying a Supreme Court order to disclose a list of wilful defaulters in res- ponse to a Right to Information (RTI) application made three years ago. WiththegovernmentinvokingSection7oftheRBIAct,thetopbank’sgovernor,UrjitPatel,comes underintensepressurefromboththeExecutiveandtheCentralInformationCommission By Venkatasubramanian T Under Siege 12 November 19, 2018
  11. 11. The RBI is a regulatory body which does not have a fiduciary relationship with the banks. Therefore, the Supreme Court found that the RBI does not have a valid justification to withhold disclo- sure sought under the RTI Act. The RBI had disclosed to the Court a list of 150 wilful defaulters who had reneged on loans worth over `500 crore. The RBI did so in a sealed cover, with a request not to divulge that information. I n Sandeep Singh Jadoun v PIO, DGEAT (Director General of Employment and Training), the appellant sought information about wil- ful defaulters of bank loans of `50 crore and above, with or without guarantees, the names of guarantors, details of sanc- tion of loans, default and details of non- performing asset accounts, etc. The appellant also wanted to know the cost and investment of the projects for employment generating schemes initiat- ed by the centre between 2005 and 2018 along with the list of failed ones and those which only existed on paper with which the Ministry of Labour and Em- ployment (MoLE) is concerned. Dis- satisfied with the Central Public Infor- mation Officer (CPIO)’s refusal to share information, the appellant approached the CIC. The CPIO had dismissed the request, saying “information was not maintained in the form sought”. The CIC found this to be neither a defence nor an exception. The reply, according to the CIC, showed that the CPIO had the information sought in some form, but did not give it. The department, the CIC held, is expected to have a record of cost and investment of the projects, and employ- ment generated by them. They should also have the list of successful and failed projects which only existed on paper, and were never introduced, the CIC held. If there are no failures, it should have been proud of it. “It is their duty to explain the reasons for the failures, if any,” the CIC said in its order. The CIC, M Sridhar Acharyulu, said in his 48-page order on November 2: “Surprisingly, the defaulters of small amounts like farmers are defamed in public, while the defaulters above `50 crore were given a long rope, high concessions in the name of one-time settlements, interest waivers, several other privileges and their names are hidden from exposure to secure their reputation!” The CIC’s order disclosed that acc- ording to RBI data, which is in the pub- lic domain, just 12 companies are esti- mated to account for 25 percent of the gross NPAs, and were identified for immediate bankruptcy proceedings, while there are 488 others which have been given six months to restructure their debt or be dragged to the National Company Law Tribunal. In October last year, The Financial Express had published the list of 12 companies. These are Bhushan Steel Ltd., Lanco Infratech Ltd., Essar Steel Ltd., Bhushan Power and Steel Ltd., Alok Industries, Amtek Auto Ltd., Mon- net Ispat and Energy Ltd., Electrosteel NO LONGER IN SYNC Union Finance Minister Arun Jaitley and RBI Governor Urjit Patel at an RBI meeting “The central government may from time to time give such directions to the Bank as it may, after consultation with the Governor of the Bank, consider neces- sary in the public interest....” This Section empowers the govern- ment to issue directions in the public interest to the central bank, which other- wise does not take orders from the gov- ernment. The use of the Section is to overcome resistance by the RBI to the centre's pressure to ease lending rules for banks and release funds from its reserves, a demand the RBI has refused so far. A recent court order suggesting that the government consider giving directions to the RBI under Section 7 of the RBI Act in a case involving independ- ent power producers seems to have prompted the government to dig out the Act from among mothballs. Power com- panies had contested a circular by the banking regulator that said that if a bor- rower misses payment even for a day, it would be considered a defaulter. Section 7 is seen as an extreme measure since it has never been used till now. It was not used even when the country was close to default in 1991 or after the 2008 global financial crisis. The use of this Section raises questions on the government’s intentions and the impact on RBI autonomy. It can have a negative impact on financial stability. ExplainingSection7:Publicinterestorpoliticalmove? In practice, the RBI exercises autonomy and takes its own decisions. However, there is a provision in the RBI Act, never used before, called Section 7. It contains the following line: | INDIA LEGAL | November 19, 2018 13 UNI
  12. 12. Steels Ltd., Era Infra Engineering Ltd., Jaypee Infratech Ltd., ABG Shipyard Ltd. and Jyoti Structures Ltd. Reuters, through information ob- tained under the RTI Act, reported that power, steel, road infrastructure and textiles sectors are the biggest loan defaulters of State-owned banks. L oan defaults or NPAs by the com- panies are distinguishable from bad loans. A loan becomes bad when a bank declares that it cannot recover the amount lent to a company. According to the newspaper report, bad loans had hit a record high of `9.5 lakh crore at the end of June 2017. Another media report, according to the CIC’s order, said that as on September 30, 2017, more than `1.1 lakh crore was owed to banks by “wilful defaulters”. There are more than 9,600 such acc- ounts for which banks have filed law- suits for recovery and found that the top 11 debtor groups, each with dues of over `1,000 crore, together had over `26,000 crore owed to the banks. After several bank officials were arrested in `11,400-crore Punjab Na- tional Bank (PNB) scam, the All India Bank Officers Confederation (AIBOC), with a membership of three lakh offi- cers, challenged the centre to publish names of the wilful defaulters of all banks. The AIBOC also urged that the banks be given the liberty to write to the home ministry to take over the passports of directors of defaulting companies to prevent their escape. The AIBOC asked why the RBI hesitated in publishing the list of defaulters like Vijay Mallya, Nirav Modi and Mehul Choksi while allowing them to leave the country. It questioned why the banks were writing off loans of thou- sands of crores every year in favour of corporate bodies. The CIC’s order cites media reports to suggest that about 7,000 mil- lionaires shifted resi- dence outside India or changed their citizen- ship. The centre admit- ted in Parliament that 31 business people facing CBI investigation had flown out of the country. A committee, headed by financial services secre- tary Rajiv Kumar, with representatives from the RBI, the ministries of home and external affairs, the Enforcement Directorate and the CBI, has recommended stop- ping wilful defaulters with loans exceeding `50 crore from travelling overseas without prior app- roval. In March, banks were directed to seek the passport details of borrowers taking loans of `50 crore and more. For the quarter ending June 30, 2018, 3,385 suits were filed against defaulting companies that had wilfully defaulted on loans of `25 lakh and above—amounting to a whopping `57,523.90 crore. The finance ministry also directed public sector banks (PSBs) to examine all NPA accounts of over `50 crore for possible fraud and accord- ingly, report the cases to concerned investigating agencies, including the CBI, ED, and Directorate of Revenue Intelligence (DRI), if any wrongdoing was detected. The CIC order cited the RBI’s Financial Stability Report, 2017, to show that India’s gross NPAs stood at 9.6 per- cent. Finance Minister Arun Jaitley told the Lok Sabha on August 11, 2017, that the gross NPAs of PSBs increased by 311.22 percent from `1,55,890 crore in 2013 to `6,41,057 crore in 2017. COOL VIBES PM Modi and then RBI Governor Raghuram Rajan in Mumbai in April 2015 TheCICdirectedtheRBI,PMOand financeministrytoexplainactiontaken onthealertingletterwrittenbyformer RBIGovernorRaghuramRajan.Theyare todosobeforeNovember16,2018. Lead/ RBI-Government Tussle 14 November 19, 2018 UNI
  13. 13. According to the rating agency, CARE, as of June 2017, State Bank of India leads the list of scheduled banks with the highest NPAs with `1,88,068 crore of stressed assets. PNB and IDBI followed with `57,721 crore and `50,173 crore of gross NPAs, respectively. IDBI Bank, which has 24.11 percent gross NPAs, tops the list for lending institu- tions with the highest exposure to liabil- ities. The RBI, according to the CIC’s order, had framed a scheme with effect from April 1, 1999, requiring banks and financial institutions to submit to the RBI the details of wilful defaulters. The RBI also recommended criminal action by banks under Sections 403 to 415 of the Indian Penal Code, which deal with cheating. T he CIC also noted that the min- istry of corporate affairs had introduced the concept of a Director Identification Number (DIN) with the insertion of Sections 266A and 266G in the Companies (Amendment) Act, 2006. The purpose of this amend- ment was to ensure that persons whose names appear to be similar to those of directors appearing in the list of wilful defaulters are not wrongfully denied credit facilities if they include the DIN in the data submitted by them to credit information companies. Section 4(1)(c) of the RTI Act re- quires every public authority to publish all relevant facts while formulating im- portant policies or announcing the deci- sions which affect the public, while Section 4(1)(d) requires it to provide reasons for its administrative or quasi- judicial decisions to affected persons. The CIC order notes that the finance ministry, the ministry of statistics and programme implementation and the RBI have a duty to inform people from time to time of all updated information and to remove the apprehensions expressed by the AIBOC and the media on the issue of wilful defaulters of `50 crore and above. The RBI, in its response, cited “a basic and long-established common law proposition” that without the expressed or implied permission of a customer, a bank must not disclose either the state of his account, any of his transactions with a bank or any information related to him acquired by reason of keeping the account, subject to certain limited and defined exceptions. The RBI also drew support from existing legal provi- sions to buttress its contention. The RBI also drew attention to Sec- tion 43A of the Information Technology Act, 2000, and the Information Techno- logy (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules, 2011, framed under the Act which gives protection to sensitive personal data or information of customers of body corporates. Rule 5(5) of these rules provides that information collected shall be used for the purpose for which it has been collected. The RBI told the CIC that it was absolutely necessary to ensure that dis- closure of any information by it is in accordance with law, and that it can publish any information obtained by it under the Banking Regulation Act, 1934, only in a consolidated form. The RBI claimed that what is being provided by banks/financial institutions to it is customer-related confidential informa- tion. “The original classification of such information is not disturbed and the applicable exemptions under RTI Act, 2005, from disclosure would continue even when the information is submitted to the RBI by various banks. Any other interpretation would result in an anom- alous and confusing situation, which is not intended under the RTI Act, 2005,” the RBI told the CIC. The RBI explained: “If otherwise interpreted, it will lead to a situation when the exemption from disclosure of such information has been recognised in the hands of the banking company, the same will be taken away when the infor- mation is held by the RBI. The adage is ‘what cannot be achieved directly cannot be achieved indirectly’.” The CIC, however, noted that these submissions of the RBI show that its legal wing did not bring to the notice of its CPIO that in RBI vs Jayanti Lal N Mistry, the division bench of the TheCICsaidthateveryloanevasionis misappropriationofpublicmoney,which thepublichasarighttoknowandbanks andthegovernmentarewaginglegal warsonthecitizensseekinginformation. | INDIA LEGAL | November 19, 2018 15 STIRRING A DEBATE CIC MS Acharyulu issued a showcause notice to the RBI over the non-disclosure of the list of wilful defaulters Anil Shakya
  14. 14. Supreme Court, on December 16, 2015, had upheld the CIC’s direction to it to disclose inspection reports and names of wilful defaulters in many cases, rejecting all the above contentions. The Supreme Court, the CIC under- lined, had already rejected the RBI’s contentions, which it had repeated in this case. The gravamen (essence) of the Supreme Court’s conclusion is that the RBI does not place itself in a fiduciary relationship with the financial institu- tions because the reports of inspections, statements of the bank, information related to the business obtained by the RBI are not on the pretext of confidence or trust. In this case, neither the RBI nor the banks act in the interest of each other. By attaching an additional “fidu- ciary” label to the statutory duty, the regulatory authorities have intentionally or unintentionally created an in terrorem effect, the Supreme Court had held. Saying that the RBI is supposed to uphold public interest and not the inter- est of individual banks, the Supreme Court had made it clear that the RBI is clearly not in any fiduciary relationship with any bank. The RBI has no legal duty to maximise the benefit of any pub- lic sector or private sector bank, and thus there is no relationship of “trust” between them, it has reasoned. It held that the RBI ought to act with trans- parency and not hide information that might embarrass individual banks. The CIC concluded: “If RBI fails to see any public interest behind this infor- mation request, it will be blind forever to understand and find what is in best economic interest of the nation, which would amount to dereliction of constitu- tional responsibility of independent reg- ulatory institution.” T wenty-nine State-owned banks wrote off a total of `1.14 lakh crore of bad debts between finan- cial years 2013 and 2015, much more than what they had done in the preced- ing nine years. As per RBI data, between April 2014 and April 2018, 21 State-owned banks wrote off `3,16,500 crore of loans even as they recovered `44,900 crore. According to a report, the amount of bad loans written off by PSBs during the four-year period is well over twice the projected budgetary expenditure on health, education and social protection for 2018-19 at `1.38 lakh crore. The CIC concluded that every eva- sion of loan is misappropriation of pub- lic money, which the public has a right to know. Vibrant citizens have a demo- cratic duty to scrutinise the way huge loans are being granted without secur- ing them properly. It is unfortunate that banks and the government are waging legal wars on the citizens who are seek- ing information to protect the names and other details of wilful defaulters, despite the Supreme Court’s judgment to the contrary, the CIC observed. The CIC, therefore, directed the CPIOs of the RBI, the PMO and the office of the finance minister to explain the action taken on the alerting letter written by former RBI Governor Raghuram Rajan on February 5. They are to do so before November 16, 2018. The CIC has threatened to initiate penal proceedings against the CPIO of the RBI if he fails to place the list of defaulters on its website as per its earli- er orders, and as confirmed by the Sup- reme Court in the Jayantilal case. Holding Urjit Patel and other officers of the top management of the RBI respon- sible for dishonouring the Supreme Court’s directions, the CIC considered the governor as the “deemed PIO” responsible for non-disclosure and defi- ance of the SC and CIC orders, and directed him to show cause why maxi- mum penalty should not be imposed on him for these reasons before November 16, 2018. The CIC also directed its ad- ministrative officers to explore the possi- bilities of enforcing the orders of then Information Commissioner Shailesh Gandhi which were taken in appeal up to the Supreme Court by the RBI (which subsequently lost it). All eyes are on November 16 when the CIC hears the matter again to review whether the RBI has complied with its directions. Twitter: @indialegalmedia Website: Contact: TheSupremeCourthadmadeitclearthat theRBIissupposedtoupholdpublic interestsand...oughttoactwith transparencyandnothideinformation thatmightembarrassindividualbanks. Lead/ RBI-Government Tussle 16 November 19, 2018 UNI
  15. 15. Supreme Court/ Election Funding 18 November 19, 2018 LECTIONS in India have always been high-spending affairs. The Election Commi- ssion of India (EC) has peri- odically revised the expendi- ture limits for candidates fighting elections to the two houses of Parliament and the state assemblies, the limit being dependent on the size of the states. In 2014, the EC revised the exp- enditure limit for candidates contesting the Lok Sabha, Rajya Sabha and the assembly elections. For larger states, the expenditure limit for the Lok Sabha election was increased from `40 lakh to `70 lakh, and for the assembly elections from `16 lakh to `28 lakh. During the assembly elections in Karnataka in May this year, an under- cover report by a TV channel showed that every candidate of a major political party spent on an average `3.5 crore for each constituency. The channel conduc- ted the operation after EC officials sei- zed almost `152 crore in cash and other inducement materials from candidates and their agents. The EC admitted that the seized money was a fraction of the actual amount used to bribe voters. With assembly polls in crucial states and the general election due in quick succession, a PIL was filed in the Supreme Court by the secretary of the Andhra Pradesh unit of the Communist Party of India, Kaka Rama Krishna, seeking strict action to curb black mon- ey and bribery in the election process. The apex court ordered that a notice be issued to the Union government for a response in this regard. The PIL was placed before a bench of Chief Justice Ranjan Gogoi and Justices KM Joseph and Hemant Gupta. The PIL focuses on the lack of action by the EC and other authorities in tak- ing stringent steps against candidates who spent more money than the amo- unt mandated by the poll body. It has also been contended in the petition that the officials had seized about `1,000 crore during elections between 2014 and 2018 but no action was taken in this regard. According to the Compendium of Instructions on Election Expenditure Monitoring issued by the EC, “the incurring or authorising of expenditure in excess of the limit prescribed under Section 77(3) of the Representation of People’s Act, 1951, is a corrupt practice with reference to Section 123(6) of the Representation of People’s Act, 1951.” The Supreme Court, in LR Shivarama- gowde v TM Chandrashekar, has con- ferred on the EC the power to inspect the election expenses of candidates and render them disqualified if the accounts do not state true facts. Moreover, Section 10A of the Repre- sentation of People’s Act empowers the EC to render a candidate disqualified for a period of three years if the candi- date fails to lodge an account of election expenses within the prescribed time and does not give any justification for his failure to do so. The EC appoints an Election Expenditure Monitoring team, which consists of an Expenditure Obse- rver, Assistant Expenditure Observer, Video Surveillance Team, Video Viewing Team etc, to ensure that elec- tions are conducted in a fair manner. The Supreme Court, in Common Cause v Union of India (1996), observed that: “Flags go up, walls are painted, and hundreds of thousands of loud speakers play out the loud exhortations and extravagant promises. VIPs and VVIPs come and go, some of them in helicopters and air taxis. The political parties in their quest for power spend more than one thousand crore of rupees on the general election (Parliament alone), yet nobody accounts for the bulk of the money so spent and there is no accountability anywhere.” The petitioner cited two former Chief Election Commi- ssioners, SY Quraishi and VS Sampath, urging the government to combat the menace of bribery in elections. The alternative, according to them, was the real danger of our democracy being turned into a “plutocracy”. E THE GREAT INDIAN SHOW Election rallies can be extravagant affairs with politicians arriving in private helicopters Checking the Loot TheCourtasksthecentreandECto respondtoaPILseekingtoughand immediatestepstotacklebriberyand useofblackmoneyduringpolls By Shaheen Parween Twitter: @indialegalmedia Website: Contact: UNI
  16. 16. Courts/ Haj Policy 20 November 19, 2018 OLLOWING a petition in the Delhi High Court which chal- lenged the new Haj policy 2018-22 where persons with disability were prohibited from going on this annual pil- grimage, the centre has amended it and allowed them permission to go. The PIL by an advocate, Gaurav Kumar Bansal, said the policy violated Articles 14, 21 and 25 of the Consti- tution. The policy, introduced by the Ministry of Minority Affairs’ Haj Committee of India, said that many such people resorted to begging once they reached Saudi Arabia. The Com- mittee said that the Haj requires one to be physically fit as the pilgrimage is rig- orous in nature. The list of disabilities includes mental illness, autism, cerebral palsy, spectrum disorder, speech and language disability and specific learning disability. However, Saudi Arabia does not have any law prohibiting those with disabilities from attending the Haj. The centre’s submission was made before a bench of Chief Justice Rajendra Menon and Justice IS Mehta. Its standing counsel, Ajay Digpaul, appearing for the Ministry of Minority Affairs, told the Court that the Haj Committee had “unanimously decided to allow persons with special needs to apply” for the pilgrimage under the general category. He also gave an affi- davit giving details of the changes made in the policy by the Haj Committee. The amended policy clearly says that “physi- cal disability of a person will not be construed as an adverse physical health”. The petitioner called the new guide- lines “discriminatory, arbitrary and unjust” as there was a clear infringe- ment of the fundamental rights of dis- abled persons. Certain words like crip- ple and lunatics, which are derogatory in nature, were used in the guidelines, said the petition. Such words are harsh and belittling. The guidelines are also in violation of the Rights of Persons with Disabilities Act, 2016. In response to the petition, the Haj Committee has decided to accommo- date people with disabilities in the gen- eral category. Such individuals can go for the pilgrimage provided they are able to take care of themselves and per- form the Haj individually. In cases where they can’t take care of themselves and need assistance, they should be accompanied by an able-bodied person who is a blood relative, it said. Maqsood Ahmad, CEO, Haj Com- mittee of India, Mumbai, told India Legal that before allowing any pilgrim to travel to Mecca, a thorough medical check-up is conducted. This includes a blood test and X-ray. He said that the previous stringent restrictions had been made more flexible. After the doctor’s certificate, if the Committee is satisfied that such a person will be able to man- age on his own or takes the help of a blood relative, he will be allowed to go. The amended policy states that “those with severe medical conditions such as terminal cancers, advanced car- diac, respiratory, liver or kidney dis- eases, infectious tuberculosis disease or senility” cannot apply for the pilgrim- age. Ahmad said it was imperative to recognise the rights of persons with dis- ability and now that new legislation had been passed conferring rights upon them, that should be respected. F BAR LIFTED Differently-abled people are no longer prohibited from the annual Haj Pilgrims’ Progress APILinDelhiHighCourthasopenedthedoorsfor differently-abledpeopletogoonthispilgrimage By Sankalan Pal Twitter: @indialegalmedia Website: Contact: TheHajpolicyhasbeenrevisedbythe MinistryofMinorityAffairs.Itclearly statesthat“physicaldisabilityofa personwillnotbeconstruedas anadversephysicalhealth”.
  17. 17. | INDIA LEGAL | November 19, 2018 21 Courts/ Reservation HE apex court has once again clarified that a Scheduled Caste person residing in one state and notified there cannot claim reservation benefit if he takes up residence in another state, whether or not his caste is included in that state’s list of Scheduled Castes. The petitioner, while applying for the post of district information officer in Uttarakhand, mentioned in her applica- tion that she belonged to a Scheduled Caste. Despite being provisionally selected, her candidature was cancelled by the Public Service Commission, Uttaranchal (now Uttarakhand), on the ground that she could not derive the benefit of reservation in Uttarakhand. Before approaching the apex court, the petitioner had filed a writ petition before the Uttarakhand High Court. The High Court, while dismissing the peti- tion, observed that the right to be treat- ed as a member of the reserved category is directly attributable to birth and a person can claim reservation only in the state in which he is born and not the one to which he may migrate. The divi- sion bench held that after migration from Punjab, the petitioner could not be treated as a member of the Scheduled Caste in Uttarakhand and therefore, she was not entitled to be appointed to the post reserved for SCs. The petitioner demanded reserva- tion on the ground that she had married a Valmiki and was a resident of Dehra- dun since 1988. She contended that the Commission had committed an error by rejecting her appointment against the post reserved for Scheduled Castes des- pite the fact that Valmiki is recognised as a Scheduled Caste in Uttar Pradesh and Uttarakhand. Two certificates issued by the tehsildar of Dehradun showed her as a Valmiki of UP and Uttaranchal and a permanent resident of Dehradun. In Action Committee on Issue of Caste Certificate to Scheduled Castes and Scheduled Tribes in the State of Maharashtra and Another v Union of India and Another (1994), the Consti- tution bench of this Court, while answering a similar question, said: “We may add that considerations for specify- ing a particular caste or tribe or class for inclusion in the list of Scheduled Castes/Scheduled Tribes or backward classes in a given state would depend on the nature and extent of disadvantages and social hardships suffered by that caste, tribe or class in that State which may be totally non est in another state to which persons belonging thereto may migrate. Coincidentally it may be that a caste or tribe bearing the same nomen- clature is specified in two States but the considerations on the basis of which they have been specified may be totally different. ...Therefore, merely because a given caste is specified in State A as a Scheduled Caste does not necessarily mean that if there be another caste bearing the same nomenclature in another State the person belonging to the former would be entitled to the rights, privileges and benefits admissible to a member of the Scheduled Caste of the latter State for the purposes of this Constitution.” The apex court while upholding the order passed by the High Court relied on two constitution bench judgments, namely Marri Chandra Shekhar Rao v Dean, Seth GS Medical College and Others (1990) and Action Committee (supra), wherein it was held that a Scheduled Caste person of one state cannot derive benefits in any other state. The Court said that permitting anything in contravention of this would dilute the law laid down in both these judgments. It dismissed the appeal. T CHANGING PERSPECTIVE Marriage often means migration for Indian women, but they then stand to lose their caste benefits Caste Away Theapexcourthassaidthatascheduledcasteinonestate cannotavailofreservationbenefitsinanotherstate By Manan Malik Twitter: @indialegalmedia Website: Contact: UNI
  18. 18. Courts/ Powers of Preventive Arrest 22 November 19, 2018 HE use of the law of pre- ventive arrest and deten- tion by those in power if used arbitrarily can become a source of injus- tice for people, especially the poor and the downtrodden. This has been reiterated multiple times by the judiciary and has also been made sub- ject to controls and regulations. In a judgment passed by a division bench of Delhi High Court, Justices S Muralidhar and Vinod Goel laid down comprehensive directions to put a bar on indiscriminate use of the powers of preventive arrest by special executive magistrates (SEMs) and the police given under Section 107 and 151 of the Criminal Procedure Code (CrPC). The Court took notice of the larger issue in a habeas corpus plea filed by advocate Aldanish Rein wherein one Narender was sent to judicial custody for two weeks by the SEM on account of unruly behaviour with a neighbour. The Court declared that the order was illegal and passed without due application of mind. It granted Narender compensation of `25,000. Section 107 sanctions the executive magistrate to order to show cause a per- son who is likely to commit breach of peace or disturb public tranquility in any way. The person will be asked why he should not be ordered to execute a bond with or without sureties for keep- ing peace for a period not exceeding one year. Section 151, on the other hand, gives the police the power to arrest a person without a warrant or an order from the magistrate. This is when they have knowledge of that person design- ing to commit a cognizable offence and there being sufficient cause to believe that the offence cannot be prevented. The given provisions have an inquisi- torial nature and are more like an inquiry than a trial which is to be carried out in a manner specified by the courts in various judgments. However, law enforcement agencies’ attempts to abide by the said laws are insignificant. This has been repeatedly seen in a large number of cases. The fact that 7,335 people were arrested in just a year from July 1, 2017, to June 13, 2018, under Sections 107 and 151 of the CrPC in Delhi shows indiscriminate exer- cise of power by the author- ities. Many of those arrest- ed were from economically weaker sections of society who are unable to provide the sureties required. Therefore, in order to counter the misuse of pow- ers granted under the said sections, the following guidelines were issued by the Court: An oversight mechanism consisting of retired dis- trict judges shall be set up by the lieutenant governor (L-G) for Delhi to review the exercise of powers by SEMs under Sections 107 and 151 of the CrPC. The L-G may even consider calling these public officials as SEMs as the appellate magistrate is like- ly to be mistaken for a judicial magis- trate. The L-G will have to issue instruc- tions to prison authorities for separate spaces in jails to avoid mixing of those who are on preventive arrest with those who have committed offences. The period of judicial custody under the said sections is limited to seven days, mandating weekly review by the SEMs for further detention. T Handle with Care TheDelhiHighCourthaslaiddowncomprehensivedirections topreventindiscriminateuseofthepowersofpreventive arrestbyspecialexecutivemagistratesandthepolice By Shivani Bhasin JusticesSMuralidhar(aboveleft)andVinodGoel passedtheorder.Itwasobservedthat7,335people werearrestedbetweenJuly1,2017,andJune13, 2018,underSections107and151oftheCrPCinDelhi.
  19. 19. language understood by him, of the grounds of his arrest and record this in the order he is going to pass. The SEM will ask the person whether he wishes to engage a lawyer of his choice and also inform him that he can avail of the services of a remand advo- cate who will remain present when these proceedings are being conducted. The SEM will allow the remand advo- cate to interact with the person arrested outside the hearing of the police officers who have got the person arrested in order to enable him to obtain the neces- sary instructions. The SEM will ensure that the remand advocate is performing his functions as required under the Legal Services Authorities Act (LSAA) and that he is also a person aware of the constitutional rights of a person arrested and will act accordingly. The SEM will record in his proceed- ings that all of the above provisions have been effectively complied with. | INDIA LEGAL | November 19, 2018 23 After directing the release of a person upon furnishing a personal bond and not insisting on surety if such a person is not in a position to furnish it, the SEM’s task will not end. He will keep the matter pending for follow-up on whether the person has actually been released on having furnished a personal bond and/or surety. If within two days of the order of release, the person has not come out of jail, the SEM should pass further orders to ensure release by either accepting a personal bond and/or surety of a lesser sum, if at all, that can be afforded by that person. The SEM has to mandatorily satisfy himself on the following grounds before passing any order under the said sec- tions: The constitutional rights of the person arrested under Articles 20, 21 and 22 have to be explained by the SEMs in a language understood by the person. The SEM must ask the person arrested whether he has been informed, in the The Delhi State Legal Services Authority (DSLSA), in association with the Delhi Judicial Academy, is directed to conduct regular training workshops and sessions for the current SEMs to train and sensitise them on the constitu- tional requirements of their power. The principal secretary, home, will periodically pay surprise visits to the courts of the SEMs accompanied by the secretary, DSLSA. Persons should be released on person- al bonds instead of sending them to judicial custody if the verification of the surety bonds is not complete by the con- cerned SHOs. An informative board should be placed outside the office of the SEM dis- playing the law of preventive arrest under the Constitution, CrPC and LSAA in English, Hindi and the language of the area. The name of the remand advo- cate, along with contact details, has to be mentioned on the board. Also, the amount to be filled in a bail bond is not to be given in cash to anyone. The fact that the SEM is not a judicial magistrate has to be stated. The superintendents of Tihar, Rohini and Mandoli jails will ensure that a pris- oner received as a result of the judicial remand order of the SEM shall not be kept in the same place as undertrials and convicts and be provided easy access to the legal aid counsel. The purpose of Sections 107 and 151 is to avert the commission of an unde- sirable offence and not to make it a tool of inequity and oppression against the marginalised. However, facts and figures point to the contrary. But, after the issue of these mandatory guidelines, less flouting and violations of rules are expected. Twitter: @indialegalmedia Website: Contact: POLICING MEASURES Awami Action Committee chairman Mirwaiz Umar Farooq being taken into preventive custody for defying house arrest in Srinagar UNI
  20. 20. Courts/ Elopement Cases 24 November 19, 2018 N an interesting development, the Madras High Court in a recent order expressed shock and pain over the increasing trend of minor girls eloping with married men. Describing this as a disturbing trend with far-reaching consequences, the Court said that the time had come to curtail such practices. It also suggested that the state government introduce counselling programmes for teenage girls and their parents to sensitise them about this problem. The issue cropped up on November 1 when a division bench of Justices N Kirubakaran and S Baskaran was hear- ing a habeas corpus petition filed by the mother of a 17-year-old girl who had eloped with a 45-year-old married man. The latter was earlier living with his wife. The bench was caught off-guard when told by the petitioner’s counsel that he had a 10-year-old daughter and immediately turned towards the addi- tional public prosecutor. When told that this was the second instance that the minor girl had eloped with this man, the bench seemed irked. The prosecutor told the bench that: “They eloped for the first time in June 2018. But the police traced them and while the minor girl was sent to her family, the man was arrested and sent to judicial custody. A case under Section 366, IPC (kidnapping, abducting or inducing a woman to compel her for marriage), was slapped against that man. However, a lower court granted I TAKING STOCK Justices N Kirubakaran (above) and S Baskaran (top) of the Madras HC Caught in a Bind Inanattempttosolvethedifficultcaseofaminorgirlelopingwithamucholdermarried man,theMadrasHighCourthasissuedanorderthatisdifficulttoimplement By R Ramasubramanian in Chennai TheMadrasHighCourtexpressedcon- cernthateverydayanumberofcasesare comingbeforethecourtwithregardto minorselopingwiththeirlovers, especiallywitholderandmarriedpeople.
  21. 21. him bail and after coming out of prison the man ran away with the girl once again.” The interim order written by Justice N Kirubakaran said: “It is not the only case of such kind. Every day a number of cases are coming before this court with regard to minors eloping with their lovers, especially with aged and married people. Today itself, this court has come across four cases of this kind.” The bench then suo motu made the director general of police and social welfare sec- retary of the Tamil Nadu government respondents and directed them to answer nine questions in their replies. (see box) A section of lawyers welcomed this judgment. BV Vijayakumar, an advo- cate, told India Legal: “Justice Kiruba- karan always stands with the people. His concerns are always with the com- mon man. He is a humane judge and in that sense, I can call him a people’s judge. This judgment will definitely help society to arrest the unhealthy practice of minor girls eloping with older and married men.” However, child rights activists saw it differently. “The Supreme Court in a 2012 judgment categorically stated that every case of a missing minor child must be considered one of human trafficking. This judgment was an outcome of a case filed by Nobel laureate and child rights activist Kailash Satyarthi. Human traf- ficking is done for various reasons— prostitution, bonded labour, organ steal- ing and begging. Just a few months back, the DGP had issued a circular directing all police personnel to treat every missing child case as one of human trafficking and hence, no lethar- gic attitude on the part of the police would be allowed,” said A Devaneyan, a child rights activist. H e added: “The issue of minor girls eloping with married/ older men is a smaller issue and has been going on for ages. But the main issue is human trafficking. If gov- ernments carry out the 2012 Supreme Court judgment and implement it in let- ter and spirit, we can to a large extent, curb human trafficking and eloping too.” Another activist, V Prabhakaran, said: “There are already several govern- ment-controlled/monitored child pro- tection bodies functioning in Tamil Nadu in all districts. These include child welfare committees, the Juvenile Justice Board, district child protection units, anti-human trafficking units, child helplines, etc. But one of the main prob- lems is that there is no coordination between them.” A retired senior police officer who did not want to be named said: “What Prabhakaran says is correct. There’s no synergy between these agencies. The bench asks why the government has not formed a separate wing to deal with such cases. But there is no need to form any special wing. The systems are alrea- dy in place. What is required is comple- te coordination between all the players.” He said that elopement is an age-old issue; what is important is to eradicate human trafficking. “Elopement is closely connected with the human psychology and cannot be addressed separately. In over 35 years of service in the police, I have come across several cases which are unimaginable. It is not a mere legal or social problem.” | INDIA LEGAL | November 19, 2018 25 Inacasefiledin2012bychildrights activistKailashSatyarthi(above),theSC categoricallyheldthateverycaseofa missingminorchildmustbeconsidered oneofhumantrafficking. 1. How many minors were either kid- napped or themselves eloped with their lovers in the past 10 years (year-wise details have to be given)? 2. How many minors were kidnapped or eloped with married / aged people? 3. How many such cases have been filed and how many people have been convicted? 4. What are all the steps taken by the state government to prevent this kind of elopement of minors with third par- ties, who are aged, married people? 5. Is it not the bounden duty of the state government to sensitize the chil- dren at the school level as well as the parents by conducting proper pro- grammes? 6. Is there any case of serial offenders cheating either sex? 7. How many people have been arrested and convicted under the Protection of Children from Sexual Offences Act of 2012 (POCSO Act)? 8. Offence under the POCSO Act is not confined to men alone. There are media reports, wherein married ladies or aged ladies are eloping with minor boys. For example, a lady teacher had eloped with her school student. Those details have to be given and whether POCSO Act has been invoked against such people. 9. Why does the Government not form a separate wing to deal with these kinds of cases? Toughluck The Madras High Court bench asked the DGP and social welfare secretary to answer nine questions regarding the case of a minor girl eloping with a married man: Twitter: @indialegalmedia Website: Contact:
  22. 22. Environment/ Aravali Biodiversity Park 26 November 19, 2018 ELLOW Vajradanti lilies dot the walkway to the car park and amphithe- atre as bright black and orange butterflies flicker past, flitting between shrubs in the lambent sunshine. A long- distance runner toils alone in quest of his fifth mile. A group of amateur pho- tographers hunts for a vantage point, comely in their youth and chattering, as a family of peacocks roosts in the ravine. All are blissfully unaware of the sword of uncertainty that hangs over the National Capital Region’s (NCR) only hand-planted forest, spread over 153.7 acres of restored Aravali terrain. It is home to over 300 species of native plants, 90 kinds of butterflies, 180 types of rare birds and wildlife such as nilgai, golden jackals, hares and civets. In short, it is a nature lover’s paradise. However, this slice of heaven is in danger. The National Highway Authority of India (NHAI) has submit- ted a proposal for the first phase of the 40-km Gurugram-Manesar Expressway or the Greater Southern Peripheral Road. It consists of a six-lane Link A road (from Ambience Mall to MG Road), 1.5 km of which will traverse the Aravali Biodiversity Park (ABDP). In the pipeline is also a longer, six-lane, Link B road (from Vasant Kunj to MG Road) that will pass via the South Delhi Ridge reserve forest area of Rangpuri, Sultanpur, Ghitorni and Rajokri villages to meet Link A at one corner of the Park. A Link C road, to be built in the next phase, will carry traffic from this intersection on to National Highway-8. The roads will strike the death knell for this young forest, only eight years old. Since its inception in 2010, it has recharged the capital’s falling water table and is the green lung for much of south Delhi and Gurugram. Growing out of what was once a stone quarry, the forest is a labour of love of thousands of children and citi- zens of Gurugram, whose efforts were led by Latika Thukral, an ex-banker; Swanzal Kak Kapoor, an architect, and Ambika Agarwal, all co-founders of iamgurgaon, an NGO. Ecological gar- dener Vijay Dhasmana is a consultant to Y Paradise Lost?WiththeNHAIplanninganexpresswaythroughtheverdantanduniquePark,itisindangerof beingexploitedbyrapaciousbuilders.ButaPILintheSupremeCourtcouldstymietheseplans By Sucheta Dasgupta THE HILLS ARE ALIVE A view of the 154-acre Aravali Biodiversity Park, the green lung of the NCR Photos: Anil Shakya
  23. 23. it. The project to plant numerous trees in this quarry was funded by 58 busi- nesses. With so much at stake, advocate Sumit Mehta and his team are now planning a legal offensive to protect the Park and the Ridge. He will file a writ petition challenging the validity of the Master Plan of Gurugram 2031 which, he says, is based on flawed data. He will also file a PIL in the Supreme Court, focussing on the consequent pol- lution and costs to environment and health and will propose alternative traf- fic routes. Located as it is on what is defined as gair mumkin pahar (uncultivable hill), gair mumkin rada (hill pastures), gair mumkin behed (ravine foothills) and banjar beed (cultivable grassland) in land documents, the Park should have been classified as Aravalis, according to the ministry of environment, forests and climate change’s 1992 Aravali Notifi- cation. It prohibits tree felling and any construction activity thereupon. How- ever, as it is not shown as forest but rev- enue land in the records of the Muni- cipal Corporation of Gurugram which owns the lion’s share of it, and is also not covered by the Punjab Land Pre- servation Act (PLPA), 1900, it remains without these two legal protections. Hills on the opposite side of the main road, though, are covered by the PLPA. A s environmental analyst Chetan Agarwal informs, in its initial forest identification exercise in 1997, Haryana only included the Aravali Plantation and areas notified under PLPA’s Sections 4 and 5. It did not in- clude areas recorded as forest in revenue books. Nor did it include areas not re- corded or notified as forest even though they fulfilled the dictionary meaning of forest as propounded by the Supreme Court in TN Godavarman Thirumalpad vs Union of India & Ors, 1996. It has now delayed this identification process by over 20 years. All this has given the real estate lobby a free hand in the region, leading to commercialisation and unplanned development as in Mangar Bani and on Surajpur-Badkhal Road, and destruction of the hills. Agarwal calls for a “deemed forest” status for the park. This way, the Forest (Conservation) Act, 1980, can be invoked to rescue the forest. Deemed forest status is accorded by the state government to all those forests which are neither defined as reserved or pro- tected forests, nor notified as jungle or bani in the revenue records, but other- wise fulfil the dictionary criteria requ- ired of a forest. Paragraph 122 of the 2011 Lafarge judgment sets out the guideline for doing this. All that is required is a site inspection by a state forest department team along with a ministry of environment, forest and cli- mate change representative. At present, there exists about 28 acres of private land in ABDP. Of these, 10 acres belong to the KP Singh-owned DLF Limited, sparking fears that once the tender is floated by NHAI after clearance of the detailed project report, it may be this company that ultimately bags the contract for building the expressway. Rajveer Singh, a senior official in the Gurugram Metropolitan Development Authority (GMDA), which has given in- principle approval to NHAI’s Phase I proposal of the expressway, claims the roads will solve the connectivity prob- lem for those travelling between Delhi and Manesar, especially businessmen. “There is a rush of traffic on NH-8, with the number of cars burgeoning daily. This leads to jams, and we need more road capacity. However, whether the gain to infrastructure derived from the expressway is more or less than the | INDIA LEGAL | November 19, 2018 27 “Noholisticviewhas beentakenoftheproject, factoringinenvironmental lossesandeffectson airpollutionand groundwater.” —ChetanAgarwal, environmentalanalyst “TheParkhasintegrated peoplefromallwalksof lifeandhasbecomea landmarkandanidentity foranotherwise-dreary, breathlesscity.” —LatikaThukral, co-founderofiamgurgaon NATURE LOVERS’ HAVEN The Park is home to 300 species of native plants,180 types of rare birds and wildlife
  24. 24. m, is already bigger than the 80 m which was planned earlier, and the vision of Link A has already been derived and achieved by it. Even if the expressway is built in the vicinity of a forest, it has been seen that traffic pres- sure and the resultant noise drives away native fauna and migratory birds. The Sultanpur bird sanctuary, for instance, lost much of its bird population when the state highway passing close to it was upgraded four-five years back. “No holistic view has been taken of the project, factoring in environmental losses and effects on air pollution and groundwater, even when there exist multiple alternative public transport strategies,” says Agarwal. “For instance, the master plan includes a rapid rail transit system, starting at Sarai Kale Khan, passing through Gurugram, and going into Alwar. Its alignment is most- ly along NH-8 and the proposal is in the final stages. Once it is in place, it will take off at least a third of the traffic on NH-8.” Thukral adds: “When we set about building this park, we realised that our city did not have a space for people to interact. Our journey has taught us how communities get formed. Earlier, Gurugram had no activity, no avenue for people to explore an alternate exis- tence outside corporate life. Now we get to interact with the Nathupur villagers, for instance, who invite us to their fami- ly functions. The Park has integrated people from all walks of life and has become not only a landmark but also an identity for an otherwise-dreary, breath- less city. If the expressway is built, the loss will be irreparable. A paradise lost was regained in the shape of this Park. Will nature give us one more chance?” 28 November 19, 2018 loss to the environment and biodiversi- ty, which will inevitably happen as a result of it, is something that must be analysed,” Singh told India Legal. Perti- nently, as Agarwal points out, no envi- ronmental impact and strategic envi- ronmental assessments take place when master plans are prepared for cities. A s per guidelines of the ministry of urban development, there has to be 20 percent green cover in every city. The Aravali Biodiversity Park contributes to over five percent of the green cover of the NCR and 11 percent of Gurugram’s. In May 2018, the National Green Tribunal had asked GMDA to scrap plans to build a 12-km stretch of the expressway through the Aravalis and stick to the original proposal in the Gurugram Master Plan 2031. But there are a lot of loopholes in this plan. A cursory glance would show, for instance, that the link road alignments proposed in it and in the Delhi-NCR J- Zone Master Plan 2021 do not match. Alarmingly, one broader issue is that the Delhi Decongestion Plan has several roads cutting through the Aravalis. The Town and Country Planning Department of the Haryana govern- ment approved the Gurugram Master Plan 2031 in December 2012. Twitter: @indialegalmedia Website: Contact: PATH OF DESTRUCTION The first phase of the Gurugram-Manesar Expressway consists of Link A that is set to traverse the Aravali Biodiversity Park Whenever the government intends to spend public money, it has to conduct a survey. The last official survey of the Government of India was conducted in 2011 when the population of Gurugram was about 15 lakh. Since then, there has been a huge population explosion there. Today, it ranges between 45 lakh-55 lakh. And though Singh and the industri- alists insist that the expressway would reduce traffic pressure, post the closing of the toll plaza and building of new underpasses at Rajiv Chowk, Hero Honda Chowk, Signature Tower, Medanta, IFFCO Chowk and Shankar Chowk, as well as the creation of diver- sions, much of the traffic on NH-8 is already streamlined, say locals. There are no longer bottlenecks between Manesar and Delhi, they claim. Instead of building Link B, enhance- ment of an existing 50-m-wide road and MG Road in Delhi can provide an alternative and much shorter route to Manesar, and save both fuel and time. The 16-lane Golf Course Road, at 150 Asperguidelines,therehastobe 20percentgreencoverineverycity.The AravaliBiodiversityParkcontributesto overfivepercentofthegreencoverofthe NCRand11percentofGurugram’s. Environment/ Aravali Biodiversity Park Mehrauli Gurgaon Road Link A Aravali Biodiversity Park
  25. 25. Environment/ Air Pollution 30 November 19, 2018 NDIA has set a target to reduce particulate matter (PM) by 30 per- cent by 2024, a ministry of envi- ronment, forests and climate change (MoEFCC) official said last week. This assertion was made at the World Health Organisation summit on air pollution in Geneva where India’s ministers and senior bureau- crats were conspicuous by their absence. It is learnt that WHO had extended invitations to three Union ministers, including Environment Minister Harsh Vardhan, but it is not known if the unveiling of the Sardar Patel statue by the prime minister is what kept them away. The conference was held in the back- drop of the severe air pollution proving to be a grave concern for health, espe- cially for children in several countries, including in India. For more than a week now, millions of residents in the National Capital Region and other major north Indian cities have been waking up every morning to a blanket of thick smog, the kind that makes the strongest of men stay indoors. There was poison in the air as smoke mixed with fog caused by firecrackers, stubble burning by farmers, garbage set on fire and vehicular pollution floated over the city. Though influential policy strate- gists and lawmakers live in Delhi, they could do little as pollution levels crossed 10 times the safe limit and hospitals across the city reported incidents of even the young being rushed in with respiratory complaints. A recent study by the World Health Organisation has found that out of the 20 most polluted cities in the world, 14 are in India. Pollution-related problems in Indian cities are nothing new as is the absence of political will to tackle it. Without fail, around this time of the year, as temperatures fall and stubble burn- ing begins in states around NCR, air qual- ity in the capital goes from bad to worse. As the media goes to town highlighting the dangers ahead, the government dishes out Thegovernmenthasacknowledgedtheneedtosettargetsandshowtheresolveto reduceparticulatematter,butunlessthereisacompliantandcrediblestrategy, thisislikelytostayonpaperonly By Ramesh Menon TACTFUL RETREAT? Though invites were sent to three Union ministers, including Environment Minister Harsh Vardhan, none attended the World Health Organisation sum- mit in Geneva (left) I Promises to Keep
  26. 26. | INDIA LEGAL | November 19, 2018 31 the mandatory promises of a clean-up. The question is: Will India be able to live up to its promise to reduce particu- late matter by 30 percent by 2024? As pollution levels in Indian cities like the capital shoot up to unmanageable levels, how realistic is this? More and more Indian cities are grappling helplessly with pollution-related problems which include deteriorating health and there does not seem to be an easy solution to get around it or even reduce it to man- ageable and permitted levels. Anumita Roy Chowdhury, air pollution expert at the Centre for Science and Environment who is on various government bodies trying to find solutions to the vexed problem of pollution, told India Legal: “The government has acknowledged that they need to set targets with their resolve to reduce particulate matter. But, targets will not work unless there is a compliant strategy. Where is the strat- egy to make the city government liable and accountable to meet cleaner stan- dards? Targets have to be such that they can be verifiable. Penal action should follow if standards are not met, like withdrawal of funds. Beijing set a target in 2012 to reduce 25 percent of pollu- tion by 2017. In five years, they have reduced it and demonstrated the will to do it. Delhi will have to reduce 74 per- cent of the pollution level it has in com- parison to reach tolerable levels. So a lot needs to be done. Our action plan has to reflect the seriousness of the problem.” T he meeting in Geneva was called as increasingly air pollution was proving to be a grave concern for health. It was seriously affecting chil- dren in numerous countries which included India. Ironically, the ministry had challenged global research on pollu- tion in one of its reports in April saying that indigenous studies were required to establish the link between air pollution and mortality. The ministry in a presenta- tion at the summit said that it was com- mitted to “bring PM10 and PM2.5 levels down in definite per- centage terms by 2024”. This will per- tain to 102 cities in India like Mumbai, Navi Mumbai, Pune, Delhi, Ghaziabad, Noida, Kolkata, Chandigarh, Bengaluru, Bhopal, Jaipur, Surat, Bhubaneswar, Cuttack, Guwahati, Visakhapatnam and others. Under the National Clean Air Programme (NCAP), the central government plans to unfurl a compre- hensive programme in 102 cities to reduce pollution by about 70 to 80 per- cent in the next 10 years. The NCAP may take financial aid from the World Bank to kick off the programme in the coming months. Sumit Sharma, air pollution expert at The Energy and Resources Institute, told India Legal: “An overall national level target of 30 percent reduction in PM2.5 and PM10 by 2024 is being pro- posed for cities with high pollution lev- els. This may look achievable, but as cities are growing at a very fast rate, sig- nificant measures will be required. It will need central level policies of enhanced LPG penetration, introduc- tion of BS-VI standards from 2020 and implementation of new power and industrial sector norms if there has to be substantial reduction in pollution. These strategies will not only reduce the direct primary particulate matter emissions AccordingtotheWHOGlobalAmbientAir QualityDatabase,2018,97percentof citiesinlowandmiddleincomecountries withmorethan1,00,000peopledonot meetWHOairqualityguidelines. EASIER SAID Beijing has set and met its target of reducing air pollution in just five years. Can Delhi replicate this? UNI
  27. 27. 32 November 19, 2018 Twitter: @indialegalmedia Website: Contact: but will also reduce emissions from industries. Other than these, control over agricultural burning and transport emissions from vehicles will be crucial. Sustainable management of agricultural residues, strengthening of inspection and maintenance systems and fleet modernisation will be required for long term improvement of air quality in India. The key here is the effective and timely enforcement of these strategies.” M eanwhile, the ministry of environment, forests and cli- mate change is at present working on a three-year National Environmental Health Profile Project that is attempting to evaluate the extent of health effects caused due to environ- mental exposure. The study that it will carry out will be spread across 20 cities spread out in four zones. Each zone will have five cities. A city where the pollu- tion levels are not very high will be taken as a referral city, and cities bat- tling heavy pollution will be taken as test cities where the three-year study would be done. It will rope in leading medical institutions like the All India Institute of Medical Sciences. In the north, Delhi, Ludhiana, Kanpur and Raipur will be test cities while Guwahati will be the referral city. Similarly, Bengaluru, Hyderabad, Visakhapatnam and Chennai will be test cities while Thiruvananthapuram will be the referral city in the south. In the west, Ahmedabad, Mumbai, Jaipur, Bhopal will be the test cities with Panaji as the referral city. In the east, Patna, Kolkata, and two other cities will be test cities, while Shillong will be the referral city. Once done, this might throw up interesting results that may help strategists to come up with a work- able plan. The exact nature of the study will be laid out sometime in late November. According to Dr TK Joshi, senior advis- er on environmental health at the min- istry of environment and forests, princi- pal investigators from the 20 cities will look at met data, health data and partic- ulate matter. The three-year analysis will look at patients admitted for acute diseases at selected hospitals. A recent study by reputed medical journal Lancet has pointed out that pollution is the largest cause of disease and death in the world. This is three times more than deaths due to HIV/AIDS, tuberculosis and malaria. Indian officials have disputed the fig- ure of 2.5 million deaths in India due to pollution, of which 1.81 were due to air pollution alone. That means 28 per- cent of the deaths in the world were from India. Other countries that saw large number of deaths due to pollu- tion were China, Pakistan, Bangladesh, Russia and Nigeria. Researchers drew from data from the Global Burden of Disease study that had comprehensive estimates on the effects of pollution on health and pinpointed contaminated sites in the world. According to the WHO Global Ambient Air Quality Database, 2018, 97 percent of cities in low and middle income countries with more than 1,00,000 people do not meet WHO air quality guidelines. However, in high income countries, it is only around 49 percent. As air quality declines, the danger of chronic and acute respirato- ry diseases which include asthma increases. So does the risk of stroke, heart disease and lung cancer. It is not a pretty picture. How realistic is it to induce artificial rain in Delhi to reduce pollution and how many times a year is it feasible? The Central Pollution Control Board, IIT-Kanpur, Indian Meteorological Department and Indian Space Research Organisation are getting together to start seeding clouds over Delhi in a des- perate effort to cut pollution. People have a right to breathe fresh and healthy air. But for that to hap- pen, lawmakers and policy wonks need to be proactive round the year on long- term strategies and not, as they do now, work in fits and starts searching for quickfixes. Environment/ Air Pollution “Whereisthestrategytomakethecity governmentliableandaccountableto meetcleanerstandards?Targetshaveto besuchthattheycanbeverifiable.Penal actionshouldfollowifstandardsarenot met,likewithdrawaloffunds.” —AnumitaRoyChowdhury,Centrefor ScienceandEnvironment “Anoverallnationaltargetof30percent reductioninPM2.5andPM10by2024is beingproposedforcitieswithhighpollu- tionlevels.Thismaylookachievable,but ascitiesaregrowingataveryfastrate, significantmeasureswillberequired.” —SumitSharma,TheEnergyand ResourcesInstitute
  29. 29. Economy/ India’s Doing Business Index 34 November 19, 2018 HE World Bank puts out an annual ranking of 190 countries to measure the ease of doing business in each country. Called the “Doing Business Index”, the yearly rankings are meant to meas- ure regulations that directly affect busi- nesses. A high ranking signifies that it is easier to start and operate a business. The index is generated through a survey which consists of a questionnaire sent out to expert contributors (lawyers, accountants, etc) who deal with business regulations on a day-to-day basis. The data collected is then further verified through conference calls with the survey participants and country visits by the World Bank team. The number one ranked country in 2018 was New Zealand where it takes half a day to set up a new business. India ranked 77th on the index, a signif- icant improvement over the 100th rank it had in the 2017 survey. Since the Modi government came to power in 2014, India’s ranking in the Doing Busi- ness Index has improved by 65 places from 142nd to 77th. As the ease of doing business ranking largely measures improvements in the regulatory burden, the Modi govern- ment deserves credit for easing this burden on Indian companies. In 2014, it took 35 days to start a business in India. Today, it takes about 29.8 days—still a far cry from the 6 hours it takes in New Zealand, or the 1½ days in Canada, or the 2½ days in Singapore and Australia. But it is an improvement nonetheless. Critics argue that much of this impr- No Rocket ScienceWhilethereisamodestimprovement,itisstillhardtodobusinessinIndia.Fortheregulatory burdentobereduced,theobtrusivegovernment,conflictingregulationsandthestifling bureaucracyneedtoundergoachange By Sanjiv Bhatia T COURTING BUSINESS PM Narendra Modi with US business leaders in Washington, DC UNI
  30. 30. | INDIA LEGAL | November 19, 2018 35 ovement reflects the advancement in digital technology and online processing of applications rather than a reduction in the regulatory burden and governme- ntal coercion faced by businesses in India. They cite the evidence that since 2003, when the first index was released, the global average in the time required to start a business has dropped from 50.78 days to 19.15 days, a significant improvement worldwide, and not just in India alone. The Doing Business Index, which is based on an equally-weighted average of 10 indicators, shows that India’s 2018 ranking improved in eight out of 10 indicators from 2015 (see box). Howe- ver, the ranking for registering property deteriorated from 121 to 166, while that for protecting shareholders remained unchanged at seventh position. The most significant improvements have come in the reduced number of proce- dures and the cost and time that it takes to obtain construction and electricity permits. Big problems remain with reg- istering of property, enforcing contracts, paying taxes and resolving insolvency. A simpler GST and an improvement in bad loans could lead to improvements on both counts in future rankings. Comparison of countries using global rankings like the Doing Business Index has now become an essential tool for governments, voters, NGOs, civil liberty advocates and policymakers. There are currently about 170 such global indices that provide easily understandable quantitative ratings of government activities and policies. Country rankings, however, need to be interpreted with caution. Rankings are ordinal numbers (1st, 2nd, 3rd, etc) and unlike cardinal numbers (1, 2, 3), they only show the relative difference between two rankings. A nation ranked 30th is better than another ranked 60th, but not twice as good. Also, a country’s rank may sometimes improve not beca- use of anything it is doing right, but because of a relative deterioration in other countries. An example of this is the Ease of Doing Business Index in which India’s rank has fluctuated several times from 116 to 142 over the last 10 years. Is this fluctuation just statistical noise or does it reflect an underlying change? W orld Bank chief economist and winner of the 2018 Nobel Prize in Economics Paul Romer recently resigned from his posi- tion at the bank stating that he had lost faith in the integrity of the Doing Business Index, suggesting it was politi- cally manipulated. Two researchers at the Center for Global Development, Justin Sandefur and Divyanshi Wadhwa, have shown that India’s rise in the Doing Business rankings is mostly an artefact of methodological and sampling changes. They recalculated the rankings and found that India’s jump is a more modest five place improvement in rank- ing as opposed to the 23 points claimed by the World Bank Doing Business ranking system. Another criticism of the Doing Business Index is that it is generated using data from Mumbai and Delhi, two cities with better infrastructure, legal systems, government services, etc, than the rest of the country. Does an impr- ovement of 113 places on getting elec- tricity, based on a survey in Mumbai which gets 24/7 electricity, reflect the reality of the country? Clearly not, and as Sandefur and Wadhwa pointed out, if the World Bank were to use the same methodology on a sample of randomly selected towns and villages, India’s score would be much lower. Other valid criticisms of the Doing Business rankings include the fact that they don’t capture the implementation of reforms. Theoretically, GST makes paying taxes easier, but in reality, its shoddy implementation in India has hurt business and destroyed jobs. Paying taxes is now considerably harder and not easier, yet the Doing Business rank- ing rewards India based on intention, not the actual outcome. It also ignores labour regulation as a component. It is generally acknowledged that India’s arc- haic labour laws are the primary detri- ment to ease of doing business in India. Surveys of foreign firms wanting to invest in India repeatedly cite restrictive labour laws and weak contract enforce- ment as the biggest impediments to doing business in India. India ranks 163rd on contract enforcement, among the worst ranked in the world. We can all agree that it is challenging to do business in an environment where con- tracts cannot be effectively enforced, irrespective of how easy it is to obtain electricity or construction permits. Critics also point to the fact that the Doing Business Index is a theoretical construct with little correlation to reali- ty. If it is easier to do business in a coun- try, then foreign investment in it should increase. But that has not always happened. Russia’s ranking climbed to 31st from 121st seven years ago and Nigeria has jumped 43 places in the “Thisresultisaveryclearsignal fromIndiatotherestoftheworld thatitisnowcompetingasthe preferredplacetodobusiness globally.Startingabusinessis nowfaster.” —AnnetteDixon,WorldBank’svice presidentforSouthAsia Twitter