Statutory, Regulatory and Various Quasi-judicial Bodies

 STATUTORY, REGULATORY AND VARIOUS QUASI-JUDICIAL BODIES

To prepare for GOVERNANCE  for any competitive exam, aspirants have to know about Statutory, Regulatory and Various Quasi-judicial Bodies. It gives an idea of all the important topics for the IAS Exam and the Governance syllabus (GS-II.). Statutory, Regulatory and Various Quasi-judicial Bodies terms are important from Governance perspectives in the UPSC exam. IAS aspirants should thoroughly understand their meaning and application, as questions can be asked from this static portion of the IAS Syllabus in both the UPSC Prelims and the UPSC Mains exams. Even these topics are also highly linked with current affairs. Almost every question asked from them is related to current events. So, apart from standard textbooks, you should rely on newspapers and news analyses as well for these sections.

 

STATUTORY BODIES
  • Statutory bodies are established by acts of Parliament or State Legislatures concerned.
  • Statutory bodies are non-constitutional bodies which make rules and regulations and take the decision on behalf of the government.
  • As these bodies are established by the act, it derives its powers, functions, duties from the respective act.
  • Statutory bodies are established to perform specific tasks. These are sector specific and lessen the burden on the government.
  • Government may grant certain level of independence in its functioning, appointment of members. Though government may grant the independence and autonomy to these bodies, government needs to ensure financial prudence in its functioning.
  • These bodies are subject to varying degrees of ministerial control which are identified in the statutory body’s enabling legislation. Ministers are accountable to Parliament for the operation of all government agencies within their ministry and are necessary to table their annual reports in Parliament.
  • The meaning of a ‘statutory body’ may change depending upon the legislation. For example, a local council is not a statutory body for the purposes of the Financial Accountability Act, but it is for the purposes of the Statutory Bodies Financial Arrangements Act.
  • All statutory bodies are established and operate under the provisions of their own enabling legislation, which sets out the purpose and specific powers of the agency.
  • Examples: National Human Rights Commission, National Green tribunal, Medical Council of India, University Grants Commission etc.

 

REGULATORY BODIES
  • The notion of the regulatory agency was initiated in the USA and it has been basically an American establishment. The first agency was Interstate Commerce Commission (ICC), established by Congress in 1887 to control the railroads.
  • A regulatory body also called a regulatory agency is a public authority or a government agency which is accountable for exercising autonomous authority over some area of human activity in a regulatory or supervisory capacity.
  • Regulatory agencies are generally a part of the executive branch of the government or they have statutory authority to execute their functions with oversight from the legislative branch.
  • Their activities are generally scrutinized by the legislature. Regulatory authorities are usually established to implement standards and safety, or to oversee use of public goods and regulate business.
  • Regulatory body, independent governmental body established by legislative act in order to set standards in a specific field of activity, or operations, in the private sector of the economy and then to enforce those standards.
  • Regulatory agencies function outside direct executive supervision. Because the regulations that they adopt have the force of law, part of these agencies’ function is essentially legislative; but because they may also conduct hearings and pass judgments concerning adherence to their regulations, they also exercise a judicial function – often carried out before a quasi-judicial official called an administrative law judge, who is not part of the court system.
  • Regulatory agencies became popular means of promoting fair trade and consumer protectionas problems of commerce and trade became more complex
  • Several risks are involved in the absence of a regulatory system. The main risks of not regulating are:
  • Excessive tariff
  • Inadequate service level and quality
  • Non-compliance of contractual obligations to users, government or other parties
  • Low efficiency in production and in the provision of goods and services
  • Inadequate level of investment in the sector
  • Frequent discontent between the parties involved

 

Functions of regulators include:
  • Protection of public interest
  • Monitoring compliance with contractual obligations to the government and users, and other legal and regulatory requirements
  • Establishing technical, safety and quality standards and monitoring their compliance
  • Imposing penalties for non-compliance
  • Administering tariff adjustments and periodic reviews
  • Establishing accounting standards and undertaking operator’s cost and performance analysis
  • Facilitating dispute resolution between parties
  • Providing advice and counsel to government on policy matters and other related matters to private sector involvement in the sector

 

Examples:
  • Securities and Exchange Board of India,
  • RBI,
  • IRDAI,
  • PFRDA,
  • Telecom and Regulatory Authority of India, etc.

 

Issues with Regulatory bodies:
  • Regulatory sprawl: In India there are total 60 regulatory bodies at the Centre and state level. In the name of specialization excessive regulatory bodies have been created. This has created complexity in day to day operations.
  • Ineffective functioning: Regulatory bodies have failed to fulfill their basic duties. They are continuously failing to meet the benchmarks. Example: Failure of RBI to curb the menace of NPAs
  • Overlapping of functions: Government’s failure to demarcate functions of regulatory bodies has created overlapping of functions. This creates not only confusion among these bodies but also becomes reasons for conflict. It also hampers Ease of Doing Business. Example: There is overlapping of functions in CVC and CBI, RBI and SEBI.
  • Issue of autonomy: Regulatory bodies lack autonomy as the members of the regulatory bodies are appointed by government. Thus, nepotism or favoritism cannot be ruled out.
  • No regular audit: Audit of regulatory bodies have never been prioritized by the government. As these bodies do not face regular audit, they have involved into corruption. Example: Medical Council of India.
  • Failure to protect environment: There are many regulatory bodies in the field of environment, but these are little achievements to count on. Example: CPCB is failed to curb air pollution, river pollution. NGT is also failing to deliver judgments on time.
  • Financial problems: All the regulatory bodies are dependent on budgetary resources for their day to day functioning. Government through the budgetary provisions interferes in the functioning of these bodies.
  • Vacancies and lack of expertise: Regulatory bodies are generally under-staffed and they also lack expertise. Most of the time, IAS officers are appointed to these bodies. These officers are not specialist and lack even basic skillset to deal with the matters of these bodies.

 

Solution:
  • Uniform appointment procedure, term of office, tenure across all regulatory bodies.
  • Budgets of these bodies should be charged upon the Consolidated Funds of India.
  • Establish Regulator of Regulators as recommended by Punchhi Commission.
  • Parliament should review the functioning of the regulatory bodies
  • At least to start with, central government can create single regulatory body for financial sector by keeping RBI as a separate body looking at the nature of its work.
  • Many countries have adopted techniques like “Regulatory Impact Assessments”. India can also mandate such techniques through legislation and thereby preserve economic value.
  • Genuine functional autonomy would also have to be reinforced with financial autonomy by putting in place a system where regulatory organisations are not dependent on government departments for financial support.
  • The appointment of persons to head regulatory organisations should be attempted in a far more transparent manner.

 

QUASI-JUDICIAL BODY
  • A Quasi-Judicial Body is an entity such as an arbitrator or a tribunal, generally of a Public Administrative Agency, which has powers and procedures resembling that of a Court of Law or Judge, and which is obliged to objectively determine facts and draw conclusions from them so as to provide the basis of an official action.
  • A Quasi-Judicial Body has also been defined as “an organ of Government other than a Court or Legislature, which affects the rights of private parties either through adjudication or rulemaking”.
  • It is not necessary that a Quasi-Judicial Body has to be a Court of Law, such as National Green Tribunal.
  • For example, the Election Commission of India is also a Quasi-Judicial Body but does not have its core functions as a Court of Law. Finance Commission is also a quasi-judicial body but do not perform functions of court of law.
  • Awards and judgements of quasi-judicial bodies often depend on a predetermined set of rules or punishment depending on the nature and gravity of the offence committed. Such punishment may be legally enforceable under the law of a country, it can be challenged in a court of law which is the final vital authority.

 

Examples:
  • Election Commission of India
  • Finance Commission
  • Income Tax Appellate Tribunal
  • Intellectual Property Appellate Tribunal, etc.

 

Reasons for Emergence of Quasi-Judicial Bodies in India
  • Normal courts of law have become costly over the years. Where quasi-judicial bodies offer cost effective solutions.
  • In quasi-judicial bodies, principle of natural justice is followed. This ensures speedy justice.
  • As the State grew in size and functions, the burden on its functions, especially those of the judicial system increased manifold. Therefore, the need for an alternative judicial system arose.
  • As the technological advances have outpaced all sectors, it requires expertise to deal with the matters. Normal courts lack such expertise and such courts may commit error while giving final verdicts.
  • Quick, hassle free and cost-effective delivery of justice.
  • Need of domain and subject expertise, such as taxation.

 

Types of quasi-judicial bodies:
  • Administrative bodies exercising quasi-judicial functions, whether as part of their respective departments or otherwise.
  • Administrative adjudicatory bodies which are outside the control of the department involved in the disputes and hence decide disputes like a Judge, free from bias. For example: Intellectual Property Appellate Tribunal.
  • Tribunals constituted under Article 323A and 323B of the Indian Constitution, enjoy the powers and status of a High Court.
  • Departmental bodies exercising inherent judicial powers of the State, wherein they perform functions pertaining to control, composition and procedure, constituted under Article 136, can also be classified as tribunals.

 

Advantages of Quasi-Judicial Bodies:
  • Lessen the burden of judiciary: Tribunals while taking up specific matters, majorly help by sharing the massive workload of the Judiciary. In a country which has 3 crore pending cases, it is important to take steps to decrease the burden of the Judiciary.
  • Simplicity: Tribunals and other such bodies do not follow any lengthy or complex procedure for submitting application or evidence etc. These bodies follow principle of natural justice.
  • Low Cost: In the conventional judicial process, a large section of the populace for the fear of expenditure, may hesitate from approaching the Courts, thus defeating the purpose of justice. Tribunals on the other hand, have an overall low cost which encourages people to seek redressal for their grievances.
  • Expert Knowledge: A tribunal comprises of experts, who can easily understand the technicalities of a case, the necessary actions involved and their consequences.
  • Accessibility: These are easily accessible to common people and offer very cost effective solutions.
  • Suo-Moto powers: Some of these bodies have suo-moto powers to initiate the proceedings. Example-NHRC can initiate actions based on reports from media or otherwise.

 

Disadvantages:
  • Pseudo independence: These bodies lack real independence from the executive as they are dependent on government for finances, man power, investigating agencies, infrastructure etc.
  • Lack of human resource: Many quasi-judicial bodies are either under-staffed or lack expertise.
  • Lack of enforcement: The verdicts of these bodies can be challenged in high courts and supreme court. Thus, such cases again pass through hierarchy of courts. This delays the justice.

 

IMPORTANT BODIES

 

NATIONAL GREEN TRIBUNAL
  • The National Green Tribunal has been established on 18.10.2010 under the National Green Tribunal Act 2010 for effective and expeditious disposal of cases relating to environmental protection and conservation of forests and other natural resources including enforcement of any legal right relating to environment and giving relief and compensation for damages to persons and property and for matters connected therewith or incidental thereto.
  • The NGT has the power to hear all civil cases relating to environmental issues and questions that are linked to the implementation of laws listed in Schedule I of the NGT Act. These include the following:
    • The Water (Prevention and Control of Pollution) Act, 1974;
    • The Water (Prevention and Control of Pollution) Cess Act, 1977;
    • The Forest (Conservation) Act, 1980;
    • The Air (Prevention and Control of Pollution) Act, 1981;
    • The Environment (Protection) Act, 1986;
    • The Public Liability Insurance Act, 1991;
    • The Biological Diversity Act, 2002.

 

Challenges:
  • The NGT does not have jurisdiction under Wildlife Protection Act (1972), Indian Forest Act 1927, Scheduled Tribes (Recognition of Forest Rights Act) and various other state legislations.
  • NGT Act specifies that the compensation amount as ordered by the tribunal should be deposited to Environmental Relief Fund within a period of 30 days. But the parties involved don’t abide by this rule.
  • Technical members are generally appointed from generalist cadre. They lack expertise knowledge and issues of favoritism can not be ruled out.
  • Given the current state of the NGT, it is reasonable to claim that the multiple objectives of access to justice, efficiency, cost-efficiency, and protection of the environment through the NGT Act, have been defeated.
  • The NGT orders are more often challenged in the Supreme Court, where a heavy penalty has been imposed by the tribunal. Such cases defeat the very purpose of NGT. There is no institutional mechanism to ensure that the environmental regulatory authorities comply with the orders of the tribunal.
  • The NGT has very few regional benches considering the expanse of the country.
  • The Act is silent on provision that who is liable to pay compensation or cost of damage to public health or environment.

 

Suggestions:
  • Appointment of Experts: It should be ensured that only expert members are appointed to the NGT.
  • Implementation of Decisions: The decisions of the Tribunal should be respected and implemented by all stakeholders.
  • Providing Proper Support: In order to be able to entertain petitions and prevent frivolous environmental litigations, the National Green Tribunal should be equipped with all the resources required for scrutinizing and reviewing petitions and investigating the intentions of petitioners.
  • Synergy with the Supreme Court: Its function should be more transparent than the Supreme Court’s in environmental cases. More importantly, the procedures of PIL should be institutionalized with guidelines in place for emphasizing the conditions under which the tribunal can entertain or reject a petition seeking its attention.
  • The National Green Tribunal could play a particularly significant role in the context of proposed reforms regarding the structure of environmental governance and the emergence of active environmental groups in the country.
  • Proper Legal Framework: The legal framework also needs to be comprehensive and suitably designed for objective interpretation of environmental laws and policies.

 

CENTRAL BUREAU OF INVESTIGATION
  • The CBI owes its origin to the Delhi Special Police Establishment, established in 1941, to enquire into cases of corruption in the procurement during the Second World War.
  • Later, based on the recommendations of the Santhanam Committee on Prevention of Corruption, CBI was established by a resolution of the Ministry of Home Affairs. Later, it was transferred to the Ministry of Personneland now it enjoys the status of an attached office.
  • The CBI is not a statutory body. It derives its powers from the Delhi Special Police Establishment Act, 1946.The CBI is the main investigating agency of the Central Government.

 

Issues with CBI:
  • Constitutional conflict: Since police is a State subject under the Constitution, and the CBI acts as per the procedure prescribed by the Code of Criminal Procedure (CrPC), which makes it a police agency, the CBI needs the consent of the State government in question before it can make its presence in that State. This is a cumbersome procedure and has led to some ridiculous situations.
  • Political interference: due to it being under the control of central government with latter having immense control over its functioning, often allegations of political misuse of CBI have been there.
  • Constitutional status: CBI enjoys great power over the investigative machinery of the country, yet it derives its origin from DPSE Act, 1946 and the MHA resolution of 1963 which puts its constitutional status on shaky ground. Guwahati High Court in 2013 termed CBI unconstitutional which was later stayed by the Supreme Court.
  • Dependence on Various Ministries: The agency is dependent on the home ministry for staffing, since many of its investigators come from the Indian Police Service. The agency depends on the law ministry for lawyers and also lacks functional autonomy to some extent.
  • Dependence on State: Generally, CBI needs consent of states to start any investigation, and recently many states like West Bengal, Maharashtra have withdrawn their general consent to CBI. Thus, in such cases CBI needs consent of states on each and every case.
  • Credibility crisis due to recent happenings.

 

Other Issues:

Problems Measures
Legislative loopholes:

1.      Its functions are based merely on a government resolution that draws its powers from the DPSE Act 1946.

2.      Its dependence on State governments’ approval for investigation in certain cases also is a concern.

 

Committee suggestions:

1.      The Second ARC (2007) also suggested that “a new law should be enacted to govern the working of the CBI”.

2.      The Parliamentary Standing Committees (2007 and 2008) recommended that “the need of the hour is to strengthen the CBI in terms of legal mandate, infrastructure and resources”.

3.      CBI should be vested with the required legal mandate and pan-India jurisdiction and must have powers to investigate corruption cases against officers of All India Services irrespective the state they are serving.

Administrative Hurdles:

1.      The CBI does not have its own cadre and is run by officers on deputation which makes them prone to manipulation by the government of the day.

2.      Additionally, lack of sufficient manpower often leads to delay in solving cases.

3.      Internal conflicts such as the recent one between Director and Special Director and their public allegations against each other are a serious concern.

Manpower strengthening:

1.      The CBI should develop its own cadre of officers who are not hindered by deputation issues and abrupt transfers.

2.      The manpower of CBI should be enhanced for effective and timely investigation.

3.      The service conditions for direct recruitment to the CBI can be improved to attract a wider talent pool.

4.      The process of direct recruitment through UPSC which was stopped in 2000 can be restarted.

·        Overlapping jurisdictions: There is an overlap in jurisdictions of CVC, CBI and Lokpal in certain cases leading to problems. In corruption cases the rates of conviction are just 3%. ·        The anti-corruption wings of CBI and CVC can be brought under Lokpal which should utilize both the organisations for investigation and prosecution. Such an integrated setup would lead to a more potent body.
·        Political Pressure: The CBI has often been criticized as acting at the government’s behest. In 2013, the Supreme Court called it a “caged parrot speaking in its master’s voice”. ·        It should be granted more autonomy by making it accountable only to the Parliament like the office of CAG.
·        Lack of Transparency: CBI is exempt from the provisions of the RTI Act of 2005 ·        There has been suggestion from an information commissioner that agencies like NIA, CBI, IB and paramilitary forces should come under the purview of RTI as there are adequate safeguards in the Act to keep sensitive information outside the public domain.

 

Lack of Transparency

CBI is exempt from the provisions of the RTI Act of 2005. There has been suggestion from an information commissioner that agencies like NIA, CBI, IB and paramilitary forces should come under the purview of RTI as there are adequate safeguards in the Act to keep sensitive information outside the public domain.

 

Provision of Prior Permission
  • The CBI is required to obtain the prior approval of the Central Government before conducting any inquiry or investigation into an offence committed by officers of the rank of joint secretary and above in the Central Government and its authorities.
  • However, on May 6, 2014, the Supreme Court held as invalid the legal provision that makes prior sanction mandatory for the CBI to conduct a probe against senior bureaucrats in corruption cases under the Prevention of Corruption Act.
  • A Constitution Bench held that Section 6A of the Delhi Special Police Establishment Act, which granted protection to joint secretary and above officers from facing even a preliminary inquiry by the CBI in corruption cases, was violative of Article 14 of the Indian Constitution.

 

Article 14 states that, “The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.”

 

CBI vs State Police

Primarily, State Police is responsible to maintain law and order in the state. CBI may investigate:

  • Cases which are essentially against central govt employees or concerning affairs of the Central govt.
  • Cases in which the financial interests of the central government are involved.
  • Cases relating to the breaches of central laws with the enforcement of which the GoI is mainly concerned.
  • Big cases of fraud, cheating, embezzlement and similar other cases when committed by organized gangs or professional criminals having ramifications in several States.

 

Difference between CBI and NIA

 

Sr. CBI NIA
1.        CBI mainly deals with internal issues of corruption, botched up investigations by State and local polices, extremely high religious and communal sensitive investigations. NIA is a terrorism investigation organization. It sole job is to investigate acts of terrorism and possible acts of terrorism.
2.        CBI is quite a massive organization spread across the country. NIA made headlines when it started to crack down the ring of terrorist cells in West Bengal. NIA is much smaller than CBI.
3.        For some State Governments CBI had to take “General Consent” NIA has a lot of power that overrides State government and even human right laws. Hence, while it was being formed, NIA faced a lot of protest.

 

SC over CBI’s autonomy

The landmark judgment in Vineet Narain v. Union of India in 1997 laid out several steps to secure the autonomy of CBI.

 

The Court directed –

  • the CBI director shall have a “minimum tenure of two years, regardless of the date of his superannuation”.
  • the Central Vigilance Commission (CVC) “shall be responsible for the efficient functioning of CBI”.
  • the CVC chief shall be selected by a panel comprising the prime minister, home minister and the leader of the opposition from a panel of “outstanding civil servants”.
  • Most importantly, the Vineet Narain judgement stated that the “transfer of an incumbent Director, CBI in an extraordinary situation, including the need for him to take up a more important assignment, should have the approval of the selection committee”

 

CBI: A Caged Parrot?
  • Politicization of the Central Bureau of Investigation (CBI) has been a work in progress for years.
  • Corruption and politically biased: This was highlighted in Supreme Court criticism for being a caged parrot speaking in its master’s voice.
  • CBI has been accused of becoming ‘handmaiden’ to the party in power, as a result high profile cases are not treated seriously.
  • Since CBI is run by central police officials on deputation hence chances of getting influenced by government was visible in the hope of better future postings.

 

Suggestions:
  • New Central Law: A comprehensive new central law should govern the working of the institutions.
  • Special Public Prosecutor: The law should specifically provide for appointment of a special public prosecutor who will have full independence to deal with the politically and nationally sensitive cases and take a stand safeguarding public interest.
  • A high-level governing board should be set up for the CBI in which, apart from the prime minister and union home minister, four-five chief ministers of states may be appointed, by turn, to give broad guidelines and keep a watch over the working of the CBI.
  • Right to Information: These organisations should be brought fully under the Right to Information law and information related to all cases except ongoing cases and cases of national security importance should be made available under RTI.
  • Fixed Term and no reappointment: The directors should have a fixed term of three years. After retirement, the director of should be made ineligible for any appointment by the Central and state governments.
  • Accountability to Parliament: Like Comptroller and Auditor General of India (CAG), parliamentary oversight would ensure better accountability, reduce chances of political misuse, and increase its credibility.
  • Dedicated cadre: Dedicated officers of its own without depending upon deputations. CVC provides for tenure stability of 2 years which must be respected for transparent and independent investigations as well.

 

Committee Suggestions:
  • The Second Administrative Reforms Commission (2007) also suggested that “a new law should be enacted to govern the working of the CBI”.
  • The Parliamentary Standing Committees (2007 and 2008) recommended that “the need of the hour is to strengthen the CBI in terms of legal mandate, infrastructure and resources.
  • CBI should be vested with the required legal mandate and pan-India jurisdiction and must have powers to investigate corruption cases against officers of All India Services irrespective the state they are serving.

 

THE FINANCE COMMISSION
  • Article 280 of the constitution of India provides for a Finance Commission.
  • It acts as a quasi-judicial
  • Constituted by the President of India every fifth year or at such earlier time as he considers necessary.
  • The First Finance Commission was constituted vide Presidential Order dated 22.11.1951 under the chairmanship of Shri K.C. Neogy on 6th April, 1952. 
  • The Constitution of India envisages the Finance commission as the “balancing wheel of fiscal federalism in India”.
  • Till 2014, role of finance commission in the Centre-state fiscal relations was undermined by the erstwhile Planning Commission (non-constitutional and a non-statutory body).

 

Issues and recommendations:
  • Mere an Advisory Body: The recommendations made by the Finance Commission are only of advisory nature and hence, not binding on the government. There is a need to amend the constitution and make the recommendations of the Finance Commission binding on the center as well as the states.
  • State Finance Commissions (SFCs): States have not been setting up their State Finance Commissions every five years as mandated by the 73rd Constitutional Amendment Act. Therefore, it is the necessity of SFCs to rationalize and systematize State/sub-state fiscal relations in India.
  • Continuity of the Finance Commission: A permanent status to the Finance Commission and a robust expenditure planning is the need of the hour. This is required, in view of the fiscal management requirements of the States, especially given the absence of mid-term reviews of awards granted by the Finance Commission.
  • Public Sector Borrowing Requirement: It is defined as borrowing by not just Central and State governments but also by all public sector corporations and agencies. This consolidated figure will more or less put an end to the manipulation of the fiscal deficit by the government. The main issue is the increasing orientation of State governments’ borrowing from markets, improving secondary market liquidity and cash management.
  • Factors driving fiscal slippage: These factors include farm loan waivers and income support schemes; rising outstanding debt as a percentage of GDP despite moderation in interest payments as a percentage of revenue receipts.

 

Fiscal Federalism
  • Fiscal federalism can best be understood as the economic counterpart to political federalism.
  • It is concerned with assigning functions to different levels of government, and providing appropriate fiscal instruments for carrying out these functions.
  • It is generally believed that the Central government should provide national public goods that render services to the entire population while sub-national governments are expected to provide goods and services whose consumption is limited to their own jurisdictions.
  • Governments often find it difficult to determine the specific fiscal instruments that enable the different levels of government to carry out their functions.
  • However Indian Constitution lays down the functions as well as taxing powers of the Centre and States providing clarity in financial relations shared by state and the centre.
 

Lord Ripon’s Contribution

Ripon tried to make local institutions self-reliant in the economic sector. In 1882, with the help of his finance secretary Major Wering, Ripon divided the source of income into three parts by a proposal:

1.      Imperial– Salt, Excise, Coast, and Laudanum tax were kept in it.

2.      Provincial – Works related to education and public welfare were kept in this.

3.      Divided Post– Land tax, forest, and stamp were kept in it.

GoI 1919 and GoI 1935 Formalized the tenets of fiscal federalism and revenue sharing between the Centre and the states
Finance Commission (Art. 280) Envisaged in the Constitution as the key institution responsible for dealing with fiscal imbalances between the center and states, as well as among the states.
14th

Finance Commission

Chaired by Dr. Y V Reddy, recommended 42% devolution of revenue to the states
NITI Aayog Estb. in 2015, expected to address new realities of macroeconomic management that were missed by the Planning Commission.
Goods and Services Tax Introduced in 2017 to streamline India’s indirect tax structure as a measure to promote cooperative federalism in India, giving the states an enhanced role in formulating and implementing the overhauled taxation system.

 

Need for a change in Fiscal federalism
  • Horizontal imbalances and rising regional inequalities – Replacing the Planning Commission (which was mandated to give grants to the states as conditional transfers using the Gadgil-Mukherjee formula) with NITI Aayog(Government think tank with no resources to dispense) has reduced the policy outreach of government by relying only on single instrument of fiscal federalism i.e. Finance commission.
  • Vertical imbalance –In India’s fiscal federalism (three levels: Central Government, State Governments and the elected Local Bodies) Central government has a far greater domain of taxation. In India’s fiscal federalism, the central government has a far greater domain of taxation Central Government collects around 60% of the total taxes, while its expenditure responsibility is only 40% of the total public expenditure. Vertical imbalances can adversely affect India’s urbanization, the quality of local public goods and thus further aggravating the negative externalities for the environment and climate change.
  • Post-Liberalization Imbalances – Market-based reform generates more inequality due to unequal capacity among states for infrastructure development. The major challenge faced by poorer states in the post reform period is to chase competitive infrastructure investment in order to attract foreign capital investment.
  • The terms of reference of the Finance Commission is decided unilaterally by the Central government which leads to raising of various issues by state governments.
  • Financial Deterioration of States – Per capita Revenue Deficit, Fiscal Deficit and Primary Deficit of states have been growing at 27.05%, 11.53% and 61.85% respectively, indicating financial deterioration of states and reflected by:
    • Mounting debt burden on States
    • Lack of scope for expansion in social and economic service.
    • Lack of scope for capital investment
    • The process of devolution of revenue becomes ineffective.

 

THE ELECTION COMMISSION
  • Election Commission of India is an independent constitutional body responsible for administering the free and fair election system and process of both the Union and State elections of India, in order to uphold the true spirit of democracy.
  • Part XV, Article 324 – 329 deals with the powers, function, tenure, eligibility, etc. of the commission and the member.
  • Article 324 of the Indian Constitution provides for an independent Election Commission for the ‘superintendence, direction and control of the electoral roll and conduct of the elections’ in India.
  • Election Commission is an all India body that conducts the elections to:
    • Parliament
    • State Legislature
    • Office of President
    • Office of Vice President.
  • Though in its inception it was a single member body from 1950 to 1989 and from 1990 to 1993, thereafter once again it became the multi-member body and has remained to cope with the increased work of the Election Commission.

 

Issues and Suggestions
  • Appointment and Removal of members of the EC: There is no ban on members of EC to get further employment in the any government. Thus nowadays it is becoming perception that EC is performing its functions independently. Also the chairman and members are appointed by the executive instead of being constitutional body. In 2015, the Law Commission recommended a collegium comprising the Prime Minister, the Leader of Opposition in the Lok Sabha and the Chief Justice of India.
  • Discriminatory removal process: CEC is removed like judge of the Supreme Court while other members are removed by the president on the recommendations of CEC. In the case of TN Seshan, Chief Election Commissioner v. Union of India, the Supreme Court held that the CEC does not have a superior status and is nothing more than a ‘first amongst equals’. In light of this interpretation, the Constitution should be amended to accord the same protection from removal to the Election Commissioners, as is accorded to the CEC.
  • De-registration of political parties: Under the Representation of People Act, 1951, the EC is the registering authority for all political parties, which have been expressly provided under Section 29A of the said Act but the power to register does not carry with it the ancillary power of de-registering a political party. ECI should be vested with all powers to deregister the non performing parties or fake parties.
  • Enforceability of Model Code of Conduct: Model Code of Conduct lacks statutory backing and ECI expects that political parties should follow the MCC in letter and spirit. But recently there are numerous cases of violation of MCC. ECI lacks enforceability powers. In 2013, the Standing Committee on Personnel, Public Grievances, Law and Justice recommended making the MCC legally binding by adding it to the Representation of People Act, 1951.
  • Issue over EVM: Though EVM has proved its capabilities ECI failed to address the concerns of political parties over the EVM. This has widened the gap between ECI and political parties as well as ECI and people.

It is imperative to restore trust in the Election Commission, for it is the guardian of elections in India, the very foundation of Indian democracy.

 

ADMINISTRATIVE TRIBUNALS

  • A tribunal is a statutory, quasi-judicial body established in India by an Act of Parliament or State Legislature to resolve disputes in speedy, cost effective and in efficient manner that are brought before it.
  • Tribunal performs a number of functions like adjudicating disputes, determining rights between contesting parties, making an administrative decision, reviewing an existing administrative decision and so forth.

 

Constitutional Basis:
  • Tribunals were not part of the original constitution.
  • Added by 42nd Amendment Act, 1976 with a new Part XIV-A to the Constitution on recommendation of Swaran Singh Committee. (Committee also recommended Fundamental Duties)
  • 323-A – deals with Administrative Tribunals.
  • 323-B– deals with tribunals for other matters.
  • Works on principle of natural justice, not abide by civil procedure code.
  • Members are drawn from Judicial and administrative streams.
  • Chairpersons of tribunals accorded Status of judges of HC
  • They enjoy some of the powers of a civil courte. issuing summons and allowing witnesses to give evidence. Its decisions are legally binding on the parties, subject to appeal.
  • In pursuance of the provisions in Article 323A, Parliament passed the Administrative Tribunal Act, 1985, providing for all the matters falling within the clause (1) of Article 323-A.
  • According to this Act, there must be a Central Administrative Tribunal (CAT) at the centre and a State Administrative Tribunal (SAT) at the state level for every state.

 

Utility of Tribunal
  • Flexibility in procedures – They are not restrained by rigid rules of procedure.
  • Less Expensive – Setup to be less formal, less expensive, and a faster way to resolve disputes than by using the traditional court system.
  • Relief to Courts – The system also gives the relief to ordinary courts of law, which are already overburdened with numerous suits, tendencies and vacancies.
  • Domain experts on a specialized subject – Reduces the time needed and thus costs.
  • Diversity of subjects -They hear disputes related to the environment, armed forces, tax and administrative issues.
  • Providing speedy and inexpensive, effective justice to the aggrieved party.

 

Difference Between Court of Law and Tribunal

Administrative Tribunals and Ordinary Courts both deal with the disputes between the parties which affects the rights of the subjects. however, Administrative Tribunal is not a court.

 

Court of Law Tribunal
A court of law is a part of the traditional judicial system. An Administrative Tribunal is an agency created by the statute and invested with judicial power.
The Civil Courts have judicial power to try all suits of a civil nature unless the cognizance is expressly barred. Tribunal is also known as the Quasi-judicial body. Tribunals have the power to try cases of special matter which are conferred on them by statutes
Judges of the ordinary courts of law are independent of the executive in respect of their tenure, terms and conditions of service etc. Judiciary is independent of Executive. Tenure, terms and conditions of the services of the members of Administrative Tribunal are entirely in the hands of Executive.
A court of law can decide vires of a legislation Administrative Tribunal cannot do so
A court of law is bound by all the rules of evidence and procedure. An Administrative Tribunal is not bound by rules but bound by the principles of nature of Justice.
The presiding officer of the court of law is trained in law and legal professional. The president or a member of the Tribunal may not be trained as well in law. He may be an expert in the field of Administrative matters.
Court must decide all questions objectively on the basis of evidence and materials on record. Decision of Administrative Tribunal may be subjective rather than objective. Administrative Tribunal may decide questions by taking into account departmental policy.

 

Problems with Tribunals
  • Violation of Doctrine of Separation of Powers Tribunal is not a court of law and is controlled and manned by the members of Judiciary and Executive which allows the Executive to perform adjudication functions.
  • Potential Conflict of interest Executives adjudicating cases of executives. Executive is also the largest litigant in the country.
  • Inadequate constitutional protection The tribunals do not enjoy the same constitutional protection as HC.
  • Increasing Pendency and inordinate delays Average pendency across tribunals is 3.8 years with 25% increase in the size of unresolved cases.
  • Undermining the Authority of JudiciaryTribunals have largely replaced HC for disputes under the various Acts.
  • Overcrowding of tribunals leads to “Tribalization of justice” as observed by Supreme Court.
  • Huge vacancies in dozens of tribunals have defeated the very purpose for which these specialized quasi- judicial forums were created.
  • Unequal geographical presence Tribunals are also not as accessible as HC. This makes justice expensive and difficult to access.
  • Overlapping Jurisdiction Various tribunals are functioning under various ministries and departments and also there are multiple tribunals performing functions of similar nature.

 

Way Forward

Law Commission of India (LCI) in its report has laid out a detailed procedure for improving the working of the tribunal system in the country-

  • Qualification of judges In case of transfer of jurisdiction of HC (or District Court) to a Tribunal, the members of the newly constituted Tribunal should possess the qualifications akin to the judges of the HC (or District Court).
  • Common nodal agency Under law ministry to monitor the working of tribunals as well as ensure uniformity in the appointment, tenure and service conditions of all members appointed in the tribunals.
  • Filling Vacancy arising in the Tribunal Preferably within six months prior to the occurrence of vacancy.
  • Selection should be impartial with minimal involvement of government agencies as the government is a party in litigation.
  • Formation of Separate Selection Committee for both judicial and administrative members.
  • Equitable regional presence Tribunals must have benches in different parts of the country to ensure easy access to justice, ideally where the HC are situated.
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