The Supreme Court on Tuesday urged the Centre to relax the borrowing limits for Kerala for the current financial year before March 31, 2024 as a one-time measure in a special case. The apex court suggested that more rigid conditions can be imposed for the next financial year.
Additional Solicitor General for India N Venkataraman, initially raised objections to granting relaxations, however, after much nudging by the court agreed to get back tomorrow 10.30 AM with the instructions from the Government.
Senior Advocate Kapil Sibal mentioned Kerala’s suit before a bench of Justice Surya Kant and Justice KV Viswanathan to inform that the negotiations between the State and the Centre, which took place on the court’s suggestion last week, failed. Previous week, the Centre refused Kerala’s request to allow borrowing of Rs 19,351 crore.
Justice Surya Kant, clarifying that the top court does not doubt the bona fide intention of the Centre to help out the State, told Attorney General R Venkataramani and ASG Venkataraman, that the court is urging them to take some special measure.
The Additional Solicitor General remarked that one of the southern states wanted a bailout package of Rs 25,000 crores, which the Centre refused. He added that the budgeted expenditure is 6% and the bailout package sought is 103%, which is 15 times more. He further questioned what is the rationale on which the Union can give, adding that they will place all materials on record.
While Justice Surya Kant urged the ASG to explore some relaxations, the ASG stated that they have done it. To this, Senior Advocate Kabil Sibal countered why is the ASG resisting like this? Subsequently, Justice Kant, attempted to persuade the Centre again, asking to find out a way. He suggested that before 31st March, the Centre can be slightly liberal in relaxing certain norms as a one-time package as a special case, subject to more rigid conditions the next financial year.
Kapil Sibal mentioned that the state can adjust it and that they have offered the aforesaid suggestion themselves. Additional Solicitor General further asserted that what happens is some states move to the Court and get this, while some other states agree on their decline letter. Hence, with this, they will be divided into states which come to court and which don’t. These are the problems which the Centre will face,he mentioned.
Following, Justice Kant urged the Centre to grant a special concession to the state before March 31 subject to the condition that their regulatory measures will be harsher than other states, may be the next financial year.
Following, ASG echoed his reservations based on the cumulative effect on the finances, mentioning that it is a rippling cycle and that they have another 10 days to manage. Justice Kant responded that let the experts explore and whatever the Centre can say before March 31, they can defer it by the first quarter of the next year.
Justice Kant remarked that as a special case, just to bail out them, some extra concession for the next ten days but to be only compensated and adjusted in the first quarter of the next financial year. Consecutively, the ASG agreed to get instructions from the Government and inform tomorrow at 10.30 AM.