CAG cant question govt policy: SC

Written by Indu Bhan | Indu Bhan | Updated: Jan 8 2014, 08:26am hrs
TVS Group firms plea rejected

The Supreme Court has rejected an appeal filed by Sundaram Industries Ltd, a part of TVS Group, in a dispute involving dismissal of 13 employees.

In March 1999, some employees were asked to do additional work by Sundaram Industries, a manufacturer of rubber products. These employees declined as they were not being paid for the additional work, following which the management suspended them. The employees union raised the matter before the labour tribunal, which held that though the allegations against the workers were proved, the dismissal was shockingly disproportionate. It ordered their reinstatement with 50% back wages. Even the Madras High Court endorsed the view.

The company then moved the apex court which dismissed its appeal. The top court observed that refusal to carry out the instructions requiring workmen to do additional work beyond the shift hours clearly tantamounts to changing the conditions of service which was impermissible without complying with the legal requirements.

Sundaram Industries argued that the conduct of the delinquent workmen was wholly unjustified as they had not only apologised for their misconduct but filed an undertaking to obey their superior officers in the future.

CAG cant question state policies

Upholding the Gujarat High Court judgment in the case, Pathan Mohammed Suleman Rehmatkhan vs State of Gujarat & Ors, the Supreme Court has held that the Comptroller and Auditor General of India (CAG) can not question the policy objectives of the state government.

The issue before the court was whether Gujarat governments decision to develop an international finance service city in the PPP mode with a social objective could be termed as arbitrary, discriminatory and an act of favouritism violating the equality clause embodied in Article 14 of the Constitution of India.

Gujarat had allotted 412 acre of land to Gujarat International Financial Tech City, a JV between Infrastructure Leasing & Financial Services Ltd (ILFS) and the state government, for development of the national financial services city in Ahmedabad. The Union government had also cleared the R9,700-crore-project.

The CAG had remarked that the performance audit revealed a number of compliance deficiencies.

On the basis of the CAG report, a PIL was filed in the HC demanding a CBI probe into the land allotment. The HC dismissed the PIL, holding that the CAG cannot question the merits of the state government's policy. This was challenged by Pathan in the apex court, which observed that CAG is a key figure in the system of parliamentary control of finance and is empowered to delve into the economy, efficiency and effectiveness with which the departmental authorities or other bodies had used their resources in discharging their functionsBut we cannot lose sight of the fact that it is the government which administers and runs the state... States welfare, progress, requirements and needs of the people are better answered by the state, also as to how the resources are to be utilised for achieving various objectives. If every decision taken by the state is tested by a microscopic and a suspicious eye, the decision- makers will lose all their initiative and enthusiasm.

The top court further said that criticisms are always welcome in a Parliamentary democracy, but a decision taken in good faith, with good intentions, without any extraneous considerations, cannot belittled, even if that decision was ultimately proved to be wrong.

No conversion of land use

SC has dismissed Oswal Agro Mills Ltd's appeal against the Bombay High Court order that quashed all the approval granted by the Municipal Corporation of Greater Mumbai and others for the construction of a residential-cum-commercial complex on its land in Central Mumbai

Hindustan Petroleum Corporation Ltd (HPCL) had objected to the clearances granted to Oswal as it saw a security threat to its refinery located near the proposed project. The oil PSU said that setting up of any residential or commercial complexes in its neighbourhood was risky and hazardous and against public interest.

Having failed to convince the state government and the Corporation to stop the construction, HPCL moved the HC seeking quashing of all approvals and permissions.

The HC, while quashing the sanctions, asked the municipal commissioner to consider the objections raised by the Police Department, Ministry of Petroleum, environment ministry and the Intelligence Bureau and the Security Control Regulations issued under the Maharashtra Regional and Town Planning Act.

Oswal and the Corporation then appealed to the Supreme Court, which upheld the HC judgment.