Team Kejriwal: Government's misleading spin on 2G

Government’s misleading spin on the 2G presidential opinion shows its dishonest intent.

The government, notably Mr. Sibal and Chidambaram have gone on an overdrive after the Supreme Court’s opinion on the 2G presidential reference to project the judgement as a vindication of the government’s policies and manner in which they have been allocating spectrum, coal and other valuable natural resources worth lakhs of crores to private companies. They are using the innocuous part of the judgement, which says that all natural resources don’t have to be auctioned in all circumstances, to claim vindication. They have even used the SCs opinion to criticize the CAG.

This only shows the dishonest intent of the government. It was nobody’s case before the Supreme Court that even natural resources like water have to be auctioned while being allocated to people. The 2G judgment merely said that natural resources like Spectrum (meaning scarce and valuable resource which are given to private companies for commercial considerations) must only be allocated by auction because apart from transparency, it ensured that the State was able to maximize revenue for the people as a trustee of the people. This has in fact been reiterated in the presidential opinion of the Court. In the words of Justice D.K. Jain (on behalf of 4 judges) in para 149 of the judgment:

“Alienation of natural resources is a policy decision, and the means adopted for the same are thus, executive prerogatives. However, when such a policy decision is not backed by a social or welfare purpose, and precious and scarce natural resources are alienated for commercial pursuits of profit maximizing private entrepreneurs, adoption of means other than those that are competitive and maximize revenue may be arbitrary and face the wrath of Article 14 of the Constitution.”

Justice Khehar in his concurring judgement has elaborated it further by saying:

“I am in respectful agreement with the aforesaid conclusion, and would accordingly opine, that when natural resources are made available by the State to private persons for commercial exploitation exclusively for their individual gains, the State’s endeavour must be towards maximization of revenue returns.  This alone would ensure, that the fundamental right enshrined in Article 14 of the Constitution of India (assuring equality before the law and equal protection of the laws), and the directive principle contained in Article 39(b) of the Constitution of India (that material resources of the community are so distributed as best to subserve the common good), have been extended to the citizens of the country.”

Justice Khehar in his concurring judgment has further examined what would happen if coal blocks were allocated to electricity distribution companies without auction, even if they had bid the lowest tariffor electricity. He says:

“If the bidding process to determine the lowest tariff has been held, and the said bidding process has taken place without the knowledge, that a coal mining lease would be allotted to the successful bidder, yet the successful bidder is awarded a coal mining lease.  Would such a grant be valid?  In the aforesaid fact situation, the answer to the question posed, may well be in the negative. This is so because, the competitive bidding for tariff was not based on the knowledge of gains, that would come to the vying contenders, on account of grant of a coal mining lease.  Such a grant of a coal mining lease would therefore have no nexus to the “competitive bid for tariff”.  Grant of a mining lease for coal in this situation would therefore be a windfall, without any nexus to the object sought to be achieved.  In the bidding process, the parties concerned had no occasion to bring down the electricity tariff, on the basis of gains likely to accrue to them, from the coal mining lease.  In this case, a material resource would be deemed to have been granted without a reciprocal consideration i.e., free of cost.  Such an allotment may not be fair and may certainly be described as arbitrary, and violative of the Article 14 of the Constitution of India. Such an allotment having no nexus to the objective of subserving the common good, would fall foul even of the directive principle contained in Article 39(b) of the Constitution of India.

Therefore, a forthright and legitimate policy, on account of defective implementation, may become unacceptable in law.”

In view of this judgement which is a concurring judgment of the court, all the allocations of coal blocks made by the government to private companies for commercial use (even for captive consumption) without auction, would have to be declared void. The government’s dishonest spin being sought to be given to the judgement by its senior ministers is another clear sign of its dishonest intent.Team Kejariwal: