SOVEREIGN DEBT RATING

What does sovereign debt rating mean?

For investors who plan to invest abroad, sovereign debt rating is taken as an indicator of the risk involved in investing in bonds issued by the national government of a country. Unlike corporate, the central government has powers like the ability to raise taxes and control money supply.

That’s why they have to be rated separately and typically, the ratings of a government of a particular country are higher than other sectors in the same regime.

The rating scale that is currently being quoted in the media is devised by credit rating agency Standard & Poor and according to it AAA is the best rating for any country. On this scale, the ratings go down to AA+, AA, AA-, A+ and so on till the worst rating which is D, which means the government is in default. Downgrading on the scale means that the risk in investment in that country’s debt is assessed to have increased and because of this, existing investors might withdraw their money while future ones might prefer to invest in safer venues.

How often have national governments defaulted on their debt?

As a national government controls most of its affairs, in the case of default, it can’t in practice be forced to pay back its debts. Some part of its overseas assets might get seized and political pressure may be applied on it, but all of that gives little relief to the investors. The government also faces pressure from domestic investors. Governments rarely default. Typically, a government on the verge of a default enters into negotiations with the investors to try and reschedule the debt or roll them over.

The market is driven by sentiments and in many cases, suspicious investors demand higher returns. There have been many incidents of sovereign debt crisis in the past. Recently, Greece, Ireland and Portugal were swallowed up by a crisis when the governments were unable to pay back investors. Similarly, in the early 1980s, Latin American countries were caught in a debt crisis as the foreign investments grew higher than their incomes and the governments were unable to pay back. Similar situations have also occurred in Mexico, Russia and Argentina.

How is rating scale devised?

The most important element in devising the scale is an analysis of the history of sovereign defaults. According to S&P, most of the defaults since the 19th century have occurred because of past policies which keep a government ill-prepared for sudden events like war, regime change or changes in trade patterns. There are essentially five key factors in determining the government’s rating.

These factors are Institutional effectiveness and political risk; economic structure and growth prospects; external liquidity and international investment position; fiscal flexibility and performance combined with debt burden; and monetary flexibility.

While some of these can be measured quantitatively, others are more qualitative in nature and hence the agency has devised scales to quantify them. For instance, political stability is rated on the basis of effectiveness, stability, and predictability of the sovereign’s policy-making, transparency of political institutions and so on.

Rule of law binds Parliament: SC

’Rule of law’ is an integral part of the basic structure of the Constitution and cannot be abrogated by Parliament which is bound by it, the Supreme Court has held.

"Rule of law as a concept finds no place in our Constitution, but has been characterized as a basic feature of our Constitution which cannot be abrogated or destroyed even by Parliament and in fact, it binds it," a five-judge constitutional bench headed by Chief Justice S H Kapadia said. "In Kesavananda Bharati’s case, this Court enunciated rule of law as one of the most important aspects of the doctrine of basic structure. Rule of law affirms Parliament’s supremacy while at the same time denying it sovereignty over the Constitution," the bench said. It added that "any law, which deprives a person of his private property for private interest, will be unlawful and unfair and undermines the rule of law and can be subjected to judicial review." The constitutional bench held that rule of law is an "implied limitation" on Parliament’s powers to legislate. The bench, however, cautioned the constitutional courts from considering the doctrine of rule of law as an absolute principle and said the doctrine can be applied in rare cases to undo laws which are tyrannical and in violation of the basic structure of our Constitution. "Rule of law as a principle, it may be mentioned, is not an absolute means of achieving equality, human rights, justice, freedom and even democracy and it all depends upon the nature of the legislation and the seriousness of the violation," it said. The bench, which also included justices Mukundakam Sharma, K S Radhakrishnan, Swatanter Kumar and Anil R Dave passed the judgment while upholding the Roerich and Devika Rani Roerich Estate Acquisition Act, 1996, enacted by the Karnataka legislature to protect the 465-acre estate of the famous Russian painter Svetoslav and his wife, in Bangalore. Svetoslav had sold a part of the estate to K T Plantation before dying but the state government took over the estate in 1996, through the act, to preserve the valuable trees, paintings and arts gallery of the artist couple. The bench while dismissing the plea of K T Plantation had said that private land of individuals can be acquired for public purpose only and with due compensation. The court also mentioned in its 122-page judgment that land acquisition becomes a matter of concern in the area of foreign investment but it should be clear to all that rule of law exists in the country. "Let the message, therefore, be loud and clear, that rule of law exists in this country even when we interpret a statute, which has the blessings of Article 300A (Persons not to be deprived of property save by authority of law). Deprivation of property may also cause serious concern in the area of foreign investment, especially in the context of International Law and international investment agreements. "Even, if the foreign investor has no fundamental right (in the host country), let them know, that the rule of law prevails in this country," the bench said.

GAMBLE IN LITIGATION

The SC finds that petitioners do not always come with clean hands

Most sane people prefer to stay away from the painfully slow and overcrowded courts. It is a misfortune to be dragged to a court, especially when one is an ordinary law-abiding citizen. Theancient Chineseswore at a foe, “let you be hauled to a court even if you’re innocent!”

However, there is a deviant species who attempt to gamble withlaw suits. They use the system to settle political scores or subdue business rivals. TheSupreme Courtspotted this class two years ago in the caseDalip Singh vs State ofUttar Pradeshand remarked: “In the last 40 years, a new breed of litigants has cropped up. The quest for personal gain has become so intense that those involved in litigation do not hesitate to take shelter in falsehood, misrepresentation and suppression of facts. Those who attempt to pollute the stream of justice or touch the pure fountain of justice with tainted hands are not entitled to any relief.”

The Supreme Court decided a few cases of this variety last week and even imprisoned one petitioner who lacked bona fides. One petition was moved by vocal politician Amar Singh. It was his constant whine that his political opponents in power are tapping his phones and his private conversations with friends in high places and celebrities were aired in the media. Therefore, he moved the Supreme Court invoking his fundamental right to privacy. But the court rejected his petition, calling it “an attempt to mislead the court on the basis of frivolous allegations and by suppression of material facts.”

Chastising those who move courts with such dubious motives, the judgment said: “This court wants to make it clear that an action at law is not a game of chess. A litigant who approaches the court must come with clean hands. He cannot prevaricate and take inconsistent positions.” Since the Amar Singh petition was vague, not conforming to the rules of procedure and riddled with inconsistencies, the court did not go into his main grievance — infringement of privacy.

The only positive outcome of the case was the court’s request to the government to “frame certain statutory guidelines to prevent interception of telephone conversation on unauthorised requests.” In this case, Reliance Infocom acted on a forged request from the police.

In another judgment,Kalyaneshwari vsUnion of India,the court deprecated misuse ofpublic interest litigationto wage business battles. A writ petition was filed in theGujarat High Courtseeking the closure of asbestos units, alleging that the material was harmful to humans. The high court dismissed it, stating that the petition was filed at the behest of rival industrial groups that wanted to push their products as substitute for asbestos. Undaunted, a similar petition was then moved in the Supreme Court. The plea was not only dismissed, but the person who mooted it was asked to pay cost of Rs 1 lakh and sit in the court for a whole day.

The judgment said: “The petition lacks bona fide and in fact was instituted at the behest of a rival industrial group, which was interested in banning of the activity of mining and manufacturing of asbestos. A definite attempt was made by it to secure a ban on these activities with the ultimate intention of increasing the demand of cast and ductile iron products as they are some of the suitable substitute for asbestos. Thus it was litigation initiated with ulterior motive of causing industrial imbalance and financial loss to the industry of asbestos through the process of court.”

The court declared that it was its duty in such circumstances to punish the petitioners exercising its power under the Contempt of Courts Act. The court must “ensure that such unscrupulous and undesirable public interest litigation be not instituted in courts of law so as to waste the valuable time of the courts as well as preserve the faith of the public in the justice delivery system.”

This variety of cases is not entirely new. They come with apparently laudable motives, but if the veil is removed they expose the real intentions. In the case,Subhash Kumar vs State of Bihar(1991), the complaint was that effluents released from theTata Iron and Steel Company’s washeries were not only contaminating the Bokaro river but also ruining agricultural land. Later the court found that the petitioner was an influential businessman who was buying the slurry from the company for several years. His private interest was hurt when the company refused to provide him more slurry. Hence his public interest litigation. Such instances have occurred despite the stringent reaction of the courts at all levels and guidelines set by theapex courtin some judgments.

SC FOR DEATH PENALTY FOR COPS IN FAKE ENCOUNTER CASES

Fake encounter killings by cops are nothing but "cold-blooded brutal murder" which should be treated as the "rarest of rare" offence and police personnel responsible for it should be awarded death sentence, the Supreme Court has ruled.

Dismissing a bunch of bail applications by a group of police officials who allegedly acted as contract killers, a bench of justices Markandeya Katju and Gyan Sudha Mishra said in a judgement that fake encounters were cold-blooded murders by the men in khaki.

"We are of the view that in cases where a fake encounter is proved against policemen in a trial, they must be given death sentence, treating it as the rarest of rare cases.

"Fake encounters are nothing but cold-blooded, brutal murder by persons who are supposed to uphold the law. In our opinion, if crimes are committed by ordinary people, ordinary punishment should be given but if the offence is committed by policemen much harsher punishment should be given to them because they do an act totally contrary to their duties," Justice Katju writing the judgement said.

The apex court said it would not brook any excuse from policemen that they were acting at the behest of their superior officers.

"We warn policemen that they will not be excused for committing murder in the name of ’encounter’ on the pretext that they were carrying out the orders of their superior officers or politicians, however high. In the Nuremburg trials, the Nazi war criminals took the plea that ’orders are orders’ but nevertheless they were hanged.

"If a policeman is given an illegal order by any superior to do a fake ’encounter’, it is his duty to refuse to carry out such illegal order, otherwise he will be charged for murder and, if found guilty, sentenced to death. The ’encounter’ philosophy is a criminal philosophy and all policemen must know this. Trigger happy policemen who think they can kill people in the name of ’encounter’ and get away with it should know that the gallows await them, the bench said.

The apex court passed the judgement while dismissing the appeal filed by head constable Prakash Kadam and other police personnel challenging their bail cancellation by the Bombay High Court.

The prosecution had argued that so-called encounter specialist Pradip Sharma, Inspector Pradip Suryawanshi, Kadam and about a dozen policemen abducted a real estate operator Ramnaryan Gupta on November 11, 2006 and shot him dead in a fake encounter.

It was alleged that the accused policemen resorted to the crime by acting as contract killers for main accused Janardan Bhange, an estranged colleague of the deceased.

Bhanged is alleged to have utilised the services of the police personnel following his differences with the deceased in real estate operations.

SC CANT REFUSE INFO IF PLEA FILED UNDER RTI, SAYS CIC

Commission Overturns Its Earlier Decision On Judicial Matters

The Central Information Commission (CIC) has overturned its own decision and ruled that the Supreme Court cannot deny information on judicial matters if an applicant has asked for it under the Right to Information Act.

As of now, information disclosure related to a person’s own case could be applied to the Supreme Court under the Right to Information Act. But in case the information related to judicial matters of a third party, the Supreme Court had ruled that application must be made under court rules. Rule 2 of theSCRules says the applicant must establish “good cause’’ before disclosure is made, which according to the CIC goes against the Right to Information Act.In his order, information commissioner Shailesh Gandhi said that he disagreed with former chief information commissioner Wajahat Habibullah’s decision.

His order said, “This bench further rules that all citizens have the right to access information under Section 3 of the Right to Information Act and PIOs shall provide the information sought to the citizens, subject always to the provisions of the Right to Information Act only.’’He added, “It is the citizen’s prerogative to decide under which mechanism, that is under the method prescribed by the public authority or the RTI Act, he would like to obtain the information.’’

The decision came after Gurgaon resident R S Mishra had asked for information related to letters he had written to the Supreme Court. The apex court had denied the information on the argument that theSChad a specific provision by which information was furnished under Order XII of the Supreme Court Rules and hence, information relating to judicial matters could be provided only under that provision. The Supreme Court PIO further argued that since the then chief information commissioner had upheld this contention, their arguments before this commission were already covered under the said decisions.

INDIA RATIFIES UN CONVENTION AGAINST CORRUPTION

India on Thursday ratified the United Nations Convention against Corruption — a politically correct move that ought to take some heat off a government battling serious corruption charges and seen as unwilling to crackdown on black money stashed away abroad.

Indeed, in recent days a question often asked was why India had not ratified the Convention when asset recovery is stated explicitly as a fundamental principle of the Convention. Besides, member-countries are bound by the Convention to render mutual legal assistance towards prosecution of offenders as well in tracing, freezing, and confiscating the proceeds of corruption.

The Prime Minister’s explanation for the delay was that the ratification had been under active consideration since September 2010 and a Group of Ministers was deputed to oversee the process. In a statement issued before his departure for Kabul, the Prime Minister further said: “….the ratification is a reaffirmation of our government’s commitment to fight corruption and to undertake vigorously administrative legal reforms to enable our law-enforcement agencies to recover the illicit assets stolen by corrupt practices.”

The text of the United Nations Convention against Corruption was negotiated during seven sessions between January 21, 2002 and October 1, 2003. The Convention was adopted by the General Assembly by Resolution 58/4 of October 31, 2003 and it entered into force on December 14, 2005.

IRAN PLANS DEATH BY STONING FOR ADULTERY

Britain urged Iran to halt the execution of a woman who a rights group says faces death by stoning for adultery.

British Foreign Secretary William Hague commented on the case of 43-year-old Sakineh Mohammadi-Ashtiani, saying it would"disgust and appal" the rest of the world.

"Stoning is a medieval punishment that has no place in the modern world and the continued use of such a punishment in Iran demonstrates in our view a blatant disregard for human rights commitments which it has previously entered into," Hague told a news conference.

Turkish Foreign Minister Ahmet Davutoglu said, "We’re trying to work and consult on all these issues with our neighbour Iran, of course we have to see the file."

The case was also raised in Britain’s House of Commons, prompting speaker John Bercow to describe it as "a horrific, truly horrific matter".

"We in this house, I hope, are in favour of human rights, not of their grotesque abuse," he added. Human rights group Amnesty International said last week it feared that Sakineh Mohammadi Ashtiani, who has two children, could be "at imminent risk" of execution by stoning at any time for adultery.

It said she was convicted in 2006 of having had an "illicit relationship" with two men and received 99 lashes as her sentence.

The rights group said that, despite this, Mohammadi Ashtiani was subsequently convicted of "adultery while being married", which it said she denied, and was sentenced to death by stoning. Hague called on Iran to put an immediate stay on the execution and review the process by which Mohammadi Ashtiani was tried.

LIFE JACKETS MUST FOR ECONOMY FLYERS TOO: DGCA

It’s been a kind of ’apartheid’ that has till now been practised by airlines in India: while economy class passengers are told to hold on to their seat cushions in case the aircraft crashes into the sea, business and first class passengers are asked to take out the life jackets placed below each premium class seat. But now, the directorate general of civil aviation has sought to end this difference by making it mandatory for Indian carriers to have life jackets for every passenger — irrespective of the class he or she flies in.

The new rule is mandatory for Indian aircraft flying on overseas international routes and even domestic ones where a minimum of 50 nautical miles (90km) have to be flown over sea. This would include routes like Chennai-Kolkata and all flights to Port Blair from the mainland.

The ending of this ’apartheid’ was among the several steps listed by aviation authorities here in response to the US Federal Aviation Administration (FAA) team’s observations. The team is in Delhi currently to review whether the promises India made to upgrade aviation standards are actually being fulfilled or not. On Thursday, the civil aviation ministry said in a statement that DGCA would continue to remain in Category 1 of FAA’s International Aviation Safety Assessment Programme (IASA).

The concern had arisen after international authorities found about two years ago that though Indian aviation was growing by leaps and bounds, no steps had been taken to accordingly strengthen the regulatory mechanism to ensure safe flights. Things got so bad that FAA had threatened that it may downgrade India to lower categories of safety.

In fact, FAA complimented the steps that director general of civil aviation Nasim Zaidi and his team are taking to strengthen the regulatory mechanism now. "The FAA team stated that DGCA... has demonstrated amazing improvement in continuing to enhance and improve safety oversight system beyond expectations. The FAA concluded that India not only continues to meet FAA’s IASA Category-1 status but also... plays a leadership role for other nations in the Asia region in civil aviation sector," the ministry statement said.

2-WHEELERS MAKERS MUST GIVE HELMETS

The Supreme Court has made it mandatory for two-wheeler manufacturers to supply helmets that conform to the Bureau of India Standards while selling scooters and motorbikes to customers. The helmets will be sold through the dealers. A bench headed by Justice G S Singhvi on Wednesday dismissed a petition filed by Society of Indian Automobile Manufacturers (SIAM) that had sought reversal of a Delhi High Court judgment giving the direction.

The bench said helmets were for the safety of customers and declined to entertain the plea that the order would force customers to have a collection of helmets.

“The high court judgment obliges a customer to purchase a helmet whenever he buys a new two-wheeler. This is despite the fact whether he possesses one or not,” contended senior advocate P.S. Patwalia, appearing for SIAM. He added the direction amounted to legislation.

To this, the bench said in a lighter vein: “There is no harm in having more than one helmet. It comes handy in situations such as taking part in protests, dharnas or even defending oneself during a fight with wife.”

The court added it was improper for it to interfere in an order that was meant for a public cause.

The Delhi High Court had on July 30, 2009, directed two-wheeler manufacturers to start selling helmets along with the vehicles. The direction came on a public interest litigation that asked the court to give directions to the companies to comply with one of the provisions of Motor Vehicles Act that mandates supply of helmets.

DUMP EGO WHEN HC MOVES PROBE TO CBI: SC TO STATES

The Supreme Court said the loud protests heard from states when a high court shifts probe of a case from the police to CBI had more to do with hurt ego than the alibi that it affected the morale of police force.

"Once the HC gives a view that the matter be investigated by the CBI in exercise of its constitutional powers, all objections of the state must come to an end," said a Bench comprising Justices Aftab Alam and R M Lodha while dismissing the Kerala government’s plea against the HC’s September 11, 2008 order asking CBI to probe a murder case. The state had challenged the HC order on the ground that it adversely affected the morale of the state police.

Least amused by the argument, the Bench said: "There are not one but dozen reports on what adversely affects the morale of the police. You will not find any of them mentioning HC orders as being an adverse factor. The morale of the police is adversely affected by actions of other kind which we do not want to say here."

Clearly, the Bench was hinting at the political interference in the affairs of the police noted in all the reports of committees appointed since the 1970s to suggest ways and means for reforms in the police force.

Having beaten the state’s argument hollow, the Bench dug in further saying: "If investigation is to be handed over to CBI, we don’t understand why should it be taken as an ego clash. Ultimately your interest is also to catch the culprit."

But, Kerala counsel and senior advocate L N Rao said it had become a trend with the HC to transfer cases to CBI from the state police as 30 cases were ordered to be investigated by the central agency in last year itself.

The Bench did not agree. "The courts do not order CBI probe as a matter of habit. This is not a routine power exercised by the HCs. Even statistically we find that several persons come to HCs with this request, but in hardly 1% or 2% cases did the HCs oblige," the Bench added.

Rao contended that in a recent judgment, the SC had held that the HCs could not routinely transfer cases to CBI. The case in hand related to the murder of one Mohammad Fazal by activists of CPM, the ruling party in the state. Rao argued that the probe could not be termed unfair or partial.

But the Bench said that the Kerala HC pointed out several lapses in theinvestigation justifying its decision to ask CBI to take up the probe. "Once the court exercises its constitutional power, the buck must stop there," the Bench said.

UIDAI WORKING TOWARDS DATABASE SECURITY CONCERNS

With the UPA government keen to roll out its ambitious plan of giving unique identity numbers to nearly a billion people, the Unique Identification Authority of India (UIDAI) is ready with a draft legislation to ensure data security and confidentiality of information. It has also proposed strict punishment for impersonation and breach of privacy, with fines ranging upto Rs 1 crore.

The draft bill proposes to make UIDAI a statutory body and provides for strict penalty for offences like disclosing identity information, impersonation, giving wrong biometrics and unauthorized access to data.

The draft law says that if any person "intentionally discloses, transmits, copies or otherwise disseminates any identity information collected in the course of enrolment or authentication to any person not authorised", he will be punished by imprisonment for a term which may extend to three years or with a fine which may extend to Rs 10,000.

In the case of a company, the fine may extend to Rs 1 lakh. Any person not authorised by UIDAI caught accessing Central Identities Data Repository (central databank) will be punished with imprisonment for a term which may extend to three years and will be liable to a fine which shall not be less than Rs 1 crore.

SOON, LAW TO TACKLE CHILD SEX ABUSE

India will soon have its first law to deal exclusively with child sexual abuse cases. The provisional draft of the bill, titled ‘Sexual Offences Against Children Bill, 2010’, seeks to substitute the word ‘rape’ with technical terms and cover several forms of abuse of both boys and girls, which now remain grey areas in the absence of a specific legislation. The proposed legislation calls for setting up of special courts, special public prosecutors and child-friendly proceedings.

"We have prepared a provisional draft in consultation with NGOs and experts, which will be forwarded to the ministry of woman and child development for inputs. We have not set a deadline to present the Bill in Parliament but we want to do it at the earliest, given the increasing number of child sexual abuse cases in the country," told Union law minister Veerappa Moily.

Calling for special courts and special prosecutors in every district to try such cases, the draft proposes that evidence from the child be recorded within a month of the court taking cognizance and the trial be completed within a year.

At present, cases of sexual offences against children are being tried under the Indian Penal Code, which does not always take into consideration the age of the victim. With such offences attracting only such sections that deal with rape, unnatural offences and outraging the modesty of a woman, many sexual offences against children, especially those against boys, were not getting a focussed trial, it was felt.

The draft proposes to prosecute child sex offenders mainly under five heads —penetrative sexual assault, aggravated penetrative sexual assault, sexual assault, aggravated sexual assault and sexual harassment.

While penetrative sexual assault covers all kinds of penetration using body parts or objects, the other acts come under sexual assault. Sexual harassment covers abuse of a child using gestures and spoken words.

The term ‘aggravated’ is prefixed to offences when the perpetrator is a person who wields power by virtue of being in a position of authority or trust or when the victim has a mental or physical disability. It recommends punishments ranging from three years in jail for ‘sexual harassment’ to life imprisonment for ‘aggravated sexual assault.’

The proposed special courts for offences against children would also hear cases pertaining to child abuse as defined under the Information Technology Act, which includes abuse through the internet and child pornography. "The bill proposes to also cover IT-aided crime against children. It will be a comprehensive law to protect children against all forms of sexual abuse," the law minister said.

While the proposed bill defines a person below the age of 18 as a child, it permits sex between people above the age of 16 years if it meets 14 conditions that define consent.

A NEW PLAY "LAW" SET FOR BHOPAL GAS LEAK VICTIMS AS AUDIENCE

Contrary to the claim made by former Union Carbide counsel Fali Nariman, the government’s move to hold a retrial in the Bhopal gas case, on the higher charge of manslaughter punishable with a 10-year term, will not violate the right to double jeopardy protection.

For, Section 300 of the Criminal Procedure Code (CrPC) — ironically, the very provision cited by Nariman in his media interviews — bars anybody from being tried again on the same facts “while such conviction or acquittal remains in force”. The ultimate objective of the curative petition due to be filed by the government before the Supreme Court is to set aside the June 7 trial court verdict, sentencing the Bhopal accused to two years on the mild charge of death caused by a rash or negligent act.
The conviction by the trial court will automatically cease to be in force once the Supreme Court allows the curative petition challenging the 1996 decision of the bench headed by the then Chief Justice of India A MAhmadi. For, the trial court verdict was determined by the 14-year-old apex court verdict, which had rather controversially reduced the liability of Bhopal gas accused from the charge of culpable homicide not amounting to murder (manslaughter) under Section 304 Part II of the Indian Penal Code (IPC) to that of death caused by a rash or negligent act under Section 304A IPC.

Since the 1996 verdict left little scope for the trial court to convict the Bhopal accused for manslaughter, the group of ministers headed by P Chidambaram rightlyconcluded that a regular appeal against the June 7 judgment before the Madhya Pradesh high court would not suffice. The Cabinet agreed with the GOM’s recommendation that the penalty for the world’s largest industrial disaster cannot go beyond the two years imposed by the June 7 verdict without first removing the shackles placed by the 1996 Supreme Court judgment.

If the curative petition works, it will override the 1996 Supreme Court verdict and that in turn will result in, as a natural corollary, the setting aside of the June 7 convictions under the lesser offence of rash or negligent death. So, when a fresh trial is held in such an eventuality on the more serious charge of manslaughter, it will in no way violate the double jeopardy rule recognized around the world.

Nariman’s attack on the government’s attempt to reprosecute Keshub Mahindra and other Bhopal accused has raised eyebrows not only because of its misleading logic about double jeopardy but also because of its sheer impropriety. For, Nariman himself had contributed to the 1996 judgment, in his capacity as counsel for Union Carbide India Limited’s managing director V P Gokhale.

The 1996 verdict quotes Nariman and other counsel arguing that there was no question of the accused having done any act “with the knowledge that they were likely by such act to cause death”. This was the basis on which the Ahmadi bench had then rejected the CBI’s allegation that the Bhopal gas accused knew about the faulty design of the plant and the deficiencies in its operation.

NLP GETS TOUGH ON PILs AGAINST PROJECTS

Petitioners contemplating PILs against ongoing projects on environment grounds might want to do a rethink. The government’s new litigation policy calls for petitioners to be slapped with costs for stoppage of projects that are in public interest.

This approach is a prominent part of the National Litigation Policy (NLP) announced recently by law minister Veerappa Moily and is a response to PILs that lack merit. Though a majority of PILs challenging projects are ultimately dismissed, they succeed in delaying work.

The NLP drafted by attorney-general G E Vahanvati says, "PILs challenging public contract must be seriously defended. If interim orders are passed stopping such projects, then appropriate condition must be insisted upon for petitioners to pay compensation if the PIL is ultimately rejected."

The policy, the government argues, is meant for those petitioners who rush to courts with PILs to merely get publicity immediately after a controversy over a social, political or legislative issue. Critics, however, are likely to argue that the policy will curb public spirited actions.

"It must be recognized that several PILs are filed for collateral reasons, including publicity, and at the instance of third parties. Such litigation must be exposed as being not bonafide," the NLP stressed.

However, NLP does not envisage all PILs as ill-intentioned or bad in law and talks about the need for government to adopt a balanced approach. "On the one hand, PILs should not be taken as a matter of convenience to let the courts do what government finds inconvenient," it said.

A good example of the government turning to the courts to bail it out was the reference on the Ayodhya issue sent by the President to the Supreme Court, immediately after the December 6, 1992 demolition of the disputed shrine. The reference sought an opinion on whether a Ram temple pre-existed the Babri mosque.
The SC had returned the reference without offering an opinion.

The NLP recognizes that an increase in the number of PILs in high courts and the Supreme Court stemmed from a perception that the government was not doing what it was supposed to do or due to a lethargic bureaucracy. "This perception must be changed," it says. The proposal to link costs with dismissal of PILs is, however, bound to be controversial.

US SUPREME COURT LIMITS GUN CONTROL BY STATES

The US Supreme Court struck down a Chicago handgun ban in a far-reaching ruling that makes it unconstitutional for states and local governments to restrict the right of Americans to own guns.

In a major victory for gun rights activists, but a bitter blow for those seeking to maintain gun controls in the United States, Justice Samuel Alito said the constitution was clear on the right to bear arms for self-defense.

The 5-4 majority ruling extended to all cities and states the Supreme Court’s 2008 landmark affirmation that Americans have the constitutional right -- as enshrined in the Second Amendment -- to own weapons, including handguns.

The National Rifle Association hailed Monday’s ruling, saying it "marks a great moment in American history."

Gun control advocates however immediately slammed the ruling, pointing to statistics that show on average 30,000 deaths -- including some 12,000 murders -- by shooting each year in the United States, where according to some estimates roughly 200 million guns are in circulation.

The Washington-based Violence Policy Center (VPC) stated, matter-of-fact: "People will die because of this decision."

In announcing the court’s majority opinion, however, Alito noted that since the Chicago handgun ban was enacted 28 years ago, the city’s murder rate by handguns actually increased.

Since the 2008 ruling -- a case originating out of the nation’s capital, called District of Columbia v. Heller -- cities with strict gun laws such as Chicago had resisted the decision.

They argued it had not made clear that the Second Amendment principle applied to local laws and states.

But in its decision on the case McDonald v. Chicago, the top court upheld the appeal that gun rights activists lodged against Chicago’s handgun ban, overturning restrictions and other gun registration elements they said impeded gun ownership.

In the majority opinion, the court maintained "self-defense is a basic right" and recalled how its 2008 ruling found "individual self-defense is ’the central component’ of the Second Amendment right."

The court acknowledged that the Bill of Rights -- the Constitution’s first 10 amendments -- originally applied only to the federal government.

But it ruled the 14th Amendment’s "due process" clause -- enacted after the US Civil War -- holds that the Bill of Rights protections such as the Second Amendment’s right to keep and bear arms must be also applied to the states.

The court, however, also employed a key caveat against the possibility of a total restriction of gun controls, which was used in the 2008 decision -- recognizing "the right to keep and bear arms is not ’a right to keep and carry any weapon whatsoever in any manner whatsoever and for whatever purpose.’"

The court also said its ruling in Heller and applied for Monday’s decision "did not cast doubt" on longstanding gun regulations, like the prohibition on felons and the mentally ill owning weapons, and laws forbidding firearms in "sensitive places" like schools and government buildings.

GERMANY OBSERVES RIGHT TO DIE

Germany’s highest court ruled Friday that it was not a criminal offense to cut off life-sustaining treatment for a patient.

The court overturned the conviction of a lawyer who last year was found guilty of attempted manslaughter for advising a client to sever the intravenous feeding tube that was keeping her mother alive, although in a persistent vegetative state. The mother had told her daughter that she did not wish to be kept alive artificially.

The verdict is likely to spur significant changes in the practice of assisted suicide and is certain to restart the debate over euthanasia and the right to die in Germany.

In its decision, the court clearly distinguished between “killing with the aim of terminating life” and an action that “let a patient die with his or her own consent.”

The ruling strengthens an individual’s right to die with dignity, since terminating life-sustaining treatments will no longer be a crime if patients have declared their wishes.

MANAGING GOVERNMENT’S LITIGATION THROUGH NLP

The Centre and states together account for 70% of the 3 crore cases pending in various courts in India -- or over 2.1 crore cases, making government the largest litigant in India.

Now, the Centre has formulated a National Litigation Policy (NLP), which will help both it and the states -- which are only too eager to adopt it -- shed this shameful tag in the next four years and decongest the dockets of the courts.
First and foremost, the policy, drafted by Attorney General G E Vahanvati and vetted by Moily, aims to make "appeal not mandatory in every case".

It will put in place a comprehensive mechanism that will impress upon the departmental heads not to go for appeals and litigation against citizens just to harass them. The "let the court decide" attitude will be given a go bye, NLP stressed.

In addition, it will provide efficient lawyers to the government departments by selecting them through a strict scrutiny and will remove any lawyer in the government panel if he or she is found to be asking for repeated adjournments.

Arbitration will be the main stay for the resolution of disputes with citizen and the entire process of arbitration would be made corruption free -- vetting of arbitration agreements and providing a clause that would warrant sacking of lawyers found delaying the process.

HIGHLIGHTS

* To transform the central government into an efficient and responsible litigant focussing only on core issues
* Conducting litigation in a time bound manner
* Ensure that good cases are won but bad cases not persevered with
* Every effort must be made to improve government representation
* Screening Committees to monitor every litigation
* All litigation to be conducted on the premise that citizens come first and government is not there to trample on fundamental rights
* Arbitration to be accepted as mainstay and all corruption in arbitration proceeding to be removed
* Arbitration agreements to be very carefully drafted. Every arbitration case to be monitored and lawyers who are found to delay arbitration should be sacked
* Appeal in every case must stop
* Government litigation share in all courts in India is 70% - to reduce it by 50%

AFSPA MIGHT BE AMMENDED

Notwithstanding opposition from the Army and faced with reports of fake encounters, the government is planning to go ahead with certain amendments in the Armed Forces Special Powers Act which includes handing over of an Army personnel in case of extra-judicial killings to the state authorities.

While of late, Army officials have been raising issues and even terming AFSPA as a ’holy book’, government sources feel that there was a need to give a fresh look to the Act and make it more humane.

The AFSPA gives the Army the powers to detain and, if the situation warrants, eliminate suspected terrorists when they are fighting insurgents without the fear of prosecution.

The Armed Forces (Special Powers) Act only in force in some areas in Kashmir and insurgency-affected states in the north east.

The Second Administrative Reforms Committee had suggested to the government replacing of the Act with an amended law which gives the Centre the right to deploy the Army or para-military forces in situations involving national security.

According to the sources, the amendments also include handing over of Army personnel, who allegedly indulge in fake killings, to the local police authorities for prosecution.

The issue of amendments has been regularly been raised by Jammu and Kashmir Chief Minister Omar Abdullah with several senior Central leaders including the Prime Minister and Home Minister P Chidambaram.

AIRLINE LIABLE TO PAY FOR DENYING BOARDING

With airlines flying out of their slowdown-induced financial troubles, the government seems to be finally turning its attention to the hapless passengers.

The Directorate General of Civil Aviation (DGCA) on Monday revived its over three-year-old plan of asking airlines to compensate flyers for wrongly denying boarding in overbooked flights and sudden cancellations that leave scores stranded across the country daily. Also, airlines including budget carriers— will be asked to provide meals, refreshments or even accommodation in case of delays if the regulator is able to translate its draft rule into reality this time by overcoming stiff resistance from powerful industry players.

Inviting public comments on these draft rules, DGCA has proposed three slabs of compensation in cases of forcible denial of boarding to those who have confirmed tickets and who report to airport in time, and sudden cancellations without prior information: up to Rs 2,000 for flights of an hours duration; up to Rs 3,000 for one to two hour-long flights and up to Rs 4,000 for longer flights. The other option for passengers would be to opt for alternate transport arrangements arranged by the airline or taking the next flight to their destination. Airlines shall first ask for volunteers to accommodate overbooked passengers who want to be on that flight.

However, airlines will not be liable to pay fines for delays or cancellations caused by events beyond their control like political instability, natural disaster, civil war, riot, strikes, ATC issues and unexpected flight safety shortcomings.

SEXUAL HARRASMENT BILL DRAFTED

Sweeping provisions proposed in a draft Bill aim to penalize firms that do not set up a sexual harassment complaints panel.

An employer can be penalized with a fine of up to Rs 50,000 if it fails to do any of the following — set up an internal committee, act on recommendations of the inquiry report, take action against those found guilty of making a false complaint or providing false evidence and publish information relating to harassment cases in its annual report.

Apart from government organizations and the organized private sector, the proposed legislation covers sectors like the hospitality industry — including catering services and restaurants — NGOs, health services, coaching centres, domestic workers and those working in tailoring or beauty parlours.

The Bill also includes educational institutions, bringing students and researchers into the ambit of protection. The draft law provides that if any employer, after being convicted of an offence punishable under the Act, is again convicted for the same offence, the punishment will be three time greater than that imposed on the first conviction, subject to the punishment being the maximum provided for the offence.

The government or local autho-rity would also have the right to cancel or withdraw the licence to carry out business activity of the employer. The employer will be expected to provide a safe, working environment at the work place.