He produces papers to show “government has adopted auction as policy for certain natural resources”

The Supreme Court, while reserving verdict on the Presidential Reference on the 2G judgment, on Thursday asked Attorney General G.E. Vahanvati to respond to Janata Party president Subramanian Swamy’s averment that the government had accepted 69 of the 81 recommendations of the Chawla Committee report that natural resources be auctioned.

Earlier, Dr. Swamy produced documents before a five-judge Constitution Bench to show that the government had accepted the committee recommendations. He said: “The government has adopted auction as a policy for certain natural resources. They have asked the ministries to implement it. A Reference is not necessary and any opinion by your Lordships may create a piquant situation.”

“Executive policy”

When Chief Justice of India S.H. Kapadia asked him whether it was a law or a policy, Dr. Swamy said it was an executive policy. He quoted a press release on the Prime Minister’s website to claim that the Ministers for Urban Development, Water, and Finance, etc, met to take a decision on the Chawla Committee report. An Empowered Group of Ministers (EGoM) had earlier accepted 69 of the 81 recommendations to adopt market-related mechanisms for allocation of natural resources. The meeting, headed by the Prime Minister, further asked the ministries to submit timelines for implementing these recommendations, Dr. Swamy said.

He also cited a PIB release to claim that the EGoM headed by the then Finance Minister, Pranab Mukherjee, had accepted these recommendations. He said a question in Parliament also proved this point.

Dr. Swamy dismissed the FDI consideration raised by the AG earlier to urge the court to answer the Presidential Reference. “In fact, more investors will come in now that they perceive a movement towards a less corrupt regime after the 2G judgment,” he said, adding this was the opinion he had heard during a dinner party with the U.S. President.

The AG said a GoM, and not the EGoM, had accepted the recommendations. These would now go to the Cabinet and various ministries, and the recommendations were yet to be accepted. He said Dr. Swamy’s contention that the recommendations had been accepted by the EGoM at its meeting on October 14, 2011 was factually incorrect. On instructions received from the Cabinet Secretariat, he said the GoM was not the EGoM. The CJI, however asked him to file a note on this aspect within a week.

Replying to arguments advanced on behalf of the Centre for Public Interest Litigation, the AG said: “It is absurd to suggest that what has been done in the 2G judgment is not a policy prescription but a mere assertion of constitutional principles. This argument, if taken to its logical conclusion, can justify any form of interference in any policy matter on the ground that all that is being done is to carry the constitutional mandate further.”

The AG said the general principle laid down in the 2G judgment that auctions must be held when scarce natural resources were allocated to private entities for commercial exploitation was incorrect. “The public interest is paramount and this can be attained in various ways, the most important being a fair procedure for disposal of natural resources which must have regard to the nature of the resource, its end use and the interest of the general public at large.”

The AG said: “The interests of the general public will be best served if the choices of policy in relation to allocation of natural resources take into account the need, utility, usefulness and sector-specificity of the resource in question and any such policy has to be fair.”

Justices D.K. Jain, J.S. Khehar, Dipak Misra and Ranjan Gogoi were the other members on the Bench, which heard marathon arguments from July 10.

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