22nd January Current Affairs

1.Exercise Kavach

News: A large scale Joint Military exercise ‘Exercise Kavach’ involving assets of Indian Army, Indian Navy, Indian Air Force and Indian Coast Guard is being conducted in the coming week under the aegis of the Andaman and Nicobar Command (ANC), the only Joint Forces Command of the country.

Objective: The tri-services exercise aims to fine tune joint war-fighting capabilities and SOPs towards enhancing operational synergy.

Details:

  • The exercise would involve participation and deployment of elements of Army’s Amphibious Brigade along with supporting forces including Special Forces of Navy, Armour/Mechanised components, Naval Ships comprising Destroyers, ASW Corvettes and Landing Ships with ship-borne helicopters of Eastern Naval Command and ANC, Jaguar Maritime Strike and Transport aircrafts from Indian Air Force and assets of Coast Guard.
  • The exercise involves synergised application of maritime surveillance assets, coordinated air and maritime strikes, air defence, submarine and landing operations. Concurrently Joint Intelligence Surveillance and Reconnaissance (ISR) exercise involving various technical, electronic and human intelligence from three services will be conducted.
  • The ISR exercise will validate the capabilities of intelligence gathering from space, air, land and sea-based assets/ sensors, its analysis and sharing to achieve battle field transparency for quick decision making at different stages of operations.
  • The joint force would execute multi domain, high intensity offensive and defensive manoeuvres in the Andaman Sea and Bay of Bengal and carry out amphibious landing operations, air landed operation, helicopters-borne insertion of Special Forces from sea culminating in tactical follow-on operations on land.

2.SC dismisses review petition on Aadhaar

News: The Supreme Court, in a majority view (4:1), dismissed a series of petitions seeking a review of its 2018 judgment upholding the Lok Sabha Speaker’s certification of Aadhaar law as a Money Bill and its subsequent passage in Parliament.

What is Review Petition?

  • Article 137 of the Constitution provides that subject to provisions of any law and rule made under Article 145 the Supreme Court of India has the power to review any judgement pronounced (or order made) by it.
  • Thus the binding decision of the Supreme Court/High Court can be reviewed in Review Petition.

Background:

  • The review petitions had highlighted how the Aadhaar Act was passed as a Money Bill by superseding the Rajya Sabha. It was called as a “fraud on the Constitution”.
  • The review petition had argued that the Aadhaar Act clearly did not fall within the ambit of Article 110 (1) of the Constitution, which restricted Money Bills to certain specific fields only.
  • Following the Supreme Court judgement, petitions were filed on two issues. These include:
  1. Whether the Speaker’s decision to declare a proposed law as Money Bill was “final” and cannot be challenged in court.
  2. Whether the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 was correctly certified as a ‘Money Bill’ under Article 110 (1) of the Constitution.

SC’s Ruling:

Majority Decision:

  • Majority of the bench (i:e 4 out of 5) held that“no case for review” of the 2018 judgment was made and dismissed the petitions. The 2019 judgment in Rojer Mathew v South Indian Bank Ltd was not sufficient to press for a reconsideration of the 2018 Aadhaar judgment.

Rojer Mathew v South Indian Bank Ltd 2019:

  • The judgment in this case said that thespeaker’s decision was not beyond judicial review though the scope was extremely restricted. It had also said that the 2018 Aadhaar verdict had not answered conclusively the question as to what constitutes a money Bill under Article 110 (1) and had directed that it be referred to a larger Bench which has not been constituted yet.

One who was against:

  • One of the five judges dissented with the majority view and said thatthe 2019 judgment questioning the correctness of the Aadhaar verdict was a relevant fact and that the apex court must wait for the larger bench of seven judges to decide these pertinent issues.
  • He also referred to the Sabarimala casewhere a nine-judge Bench in February 2020 had referred certain questions of law arising in the context of an earlier decision by a five-judge Bench in September 2019 to a larger Bench while keeping the review petitions pending.
  • He held that it is a constitutional error to hold at this stage that no ground exists to review the judgmentand it would have serious consequences not just for judicial discipline, but also for the ends of justice.
  • Even as one of the five judges on the bench termed it a “constitutional error,” the SC by a majority verdict has dismissed a clutch of petitions seeking a review of its 2018 judgment that validated the Aadhaar Act.

What is a Money Bill?

  • A Money Bill is one that contains provisions for taxes, appropriation of funds etc. Money Bills can be introduced only in the Lok Sabha, and the Rajya Sabha cannot make amendments to such bills passed by the Lok Sabha.
  • The Rajya Sabha can suggest amendments, but it is the Lok Sabha’s choice to accept or reject them.
  • Under Article 110(1), a Bill is deemed to be a money Bill if it deals only with matters specified in Article 110 (1) (a) to (g) — taxation, borrowing by the government and appropriation of money from the Consolidated Fund of India among others.
  • According to Article 110 (3) of the Constitution, “if any question arises whether a Bill is a Money Bill or not, the decision of the Speaker of the House of the People thereon shall be final.”

How is a Money Bill different from a financial bill?

  • While all Money Bills are Financial Bills, all Financial Bills are not Money Bills.
  • For example, the Finance Bill which only contains provisions related to tax proposals would be a Money Bill. However, a Bill that contains some provisions related to taxation or expenditure, but also covers other matters would be considered as a Financial Bill.

3.SC upheld IBC

News: The Supreme Court has held that the bidders for a corporate debtor under the Insolvency and Bankruptcy Code (IBC) would be immune from any investigations being conducted either by any investigating agencies.

Details:

  • In its judgment, the apex court, while upholding the validity of Section 32 A of IBC, said
  • It was important for the IBC to attract bidders who would offer reasonable and fair value for the corporate debtor to ensure the timely completion of corporate insolvency resolution process (CIRP).
  • Such bidders, however, must also be granted protection from any misdeeds of the past since they had nothing to do with it.
  • Such protection, the court said, must also extend to the assets of a corporate debtor, which form a crucial attraction for potential bidders and helps them in assessing and placing a fair bid for the company, which, in turn, will help banks clean up their books of bad loans.

About IBC:

  • IBC was enacted on May 28, 2016, to effectively deal with insolvency and bankruptcy of corporate persons, partnership firms and individuals, in a time-bound manner.
  • It has brought about a paradigm shift in laws aimed to maximize the value of assets, providing a robust insolvency resolution framework and differentiating between impropriety and business debacle.
  • The predominant object of the Code is the resolution of the Corporate Debtor.
  • It has been amended four times to resolve problems hindering objectives of the Code.

Section 32A:

  • In cases involving property of a corporate debtor, Section 32A covers any action involving attachment, seizure, retention, or confiscation of the property of the corporate debtor as a result of such Proceedings.
  • It provides immunity to the corporate debtor and its property when there is the approval of the resolution plan resulting in the change of management of control of the corporate debtor.
  • This is subject to the successful resolution applicant being not involved in the commission of the offence.

Challenges:

  • Since the IBC came into being in 2016, the implementation of the resolution plan of several big cases has been delayed because of various challenges mounted by its own agencies and regulators.
  • For example, a debt-laden company, admitted into insolvency in 2017, owes more than Rs 47,000 crore to banks and other financial institutions.
  • After a prolonged bidding battle, another won the rights to take over it with a bid of Rs 19,700 crore.
  • However, before it could move to take over, the ED/SEBI swooped in, and attached assets worth Rs 4,000 crore citing alleged fraud in a bank loan under the Prevention of Money Laundering Act (PMLA).

Significance of the judgement:

  • With the Supreme Court upholding the validity of Section 32 A, the cases such as that of Bhushan Power are expected to be completed soon. Experts also said that this will give confidence to other bidders to proceed with confidence while bidding on such disputed companies and their assets.

4.True Empowerment of Electricity Consumers

Background:

  • The Electricity (Rights of Consumers) Rules, 2020 was promulgated in December to deal with the problems faced by the consumers. The enactment of consumer-centric rules does spark public debate that brings the rights of consumers to the fore. The Rules lay an emphasis onnational minimum standards for the performance parameters of DISCOMs. without urban-rural distinction. They also reiterate the need for automatically compensating consumers.

Issue of supply quality and lack of accountability

  • Many States have not been able to provide quality supply, especially to rural and small electricity consumers. Provisions similar to made in the new Rule already exist in the Standards of Performance (SoP)regulations of various State Electricity Regulatory Commissions (SERCs).
  • It is not because of a lack of rules or regulations that quality supply is not provided; rather, it is onaccount of a lack of accountability systems to enforce them. Unfortunately, neither these rules nor past efforts address these accountability concerns. Guarantee of round the clock supply is a provision that the Rules emphasise, which might be missing in State regulations.
  • It is difficult to enforce since the availability of power supply is inadequately monitored even at 11 kV feeders, let alone at the consumer location. This highlights not only the need for implementation of existing provisions in letter and spirit but also amending them with strong accountability provisions.

Weakening provisions

  • The Rules, in few cases, dilute progressive mechanisms that exist in State regulations.
  • For example, the Rules say that faulty meters should be tested within 30 days of receipt of a complaint.
  • Compared to this, regulations t in Andhra Pradesh, Bihar, and Madhya Pradesh, respectively, say that such testing needs to be conductedwithin seven days.
  • A similar observation can be drawn from the suggested composition of the Consumer Grievance Redressal Forum.  The Rules say that the forum — constituted to remedy complaints against DISCOMs should be headed by a senior officer of the company. This is a regressive provision that would reduce the number of cases that are decided in favour of consumers.
  • The Rules guarantee net metering for a solar rooftop unit less than 10 kW. However, there is no clarity if those above 10 kW can also avail net metering. This could lead to a change in regulations in many States based on their own interpretations.
  • The possible litigation that follows would be detrimental to investments in rooftop solar units, and would discourage medium and large consumers to opt for an environment-friendly, cost-effective option.

Need for Commitment:

  • SERCs should assess the SoP reports of DISCOMs and revise their regulations more frequently. SERCs should organise public processes to help consumers raise their concerns. DISCOMs could be directed to ensure automatic metering at least at the 11 kV feeder level, making this data available online.
  • The Forum of Regulators — a central collective of SERCs — could come up with updated model SoP regulations. Central agencies have taken proactive efforts to ensure regular tariff revision.
  • They could also support independent surveys and nudge State agencies to enforce existing SoP regulations.
  • The central government could disburse funds for financial assistance programmes based on audited SoP reports.
  • The governments, DISCOMs and regulators need to work jointly and demonstrate the commitment and the will power to implement existing regulations. It is not yet late to recognise this and initiate concerted efforts to truly empower consumers.