New Delhi:
The Supreme Court today said that it does not believe that all national resources must be auctioned - the opinion, delivered by five judges, provides relief for the government, partly because it accepts that the government has the right to decide policy, and also because it emphasised that "Auctions may be the best way of maximizing revenue, but revenue maximization may not always be the best way to subserve public good."
However, the judges stressed the need for transparency and for fairness in implementing policies, warning that courts will strike down any laws that are unconstitutional or arbitrary.
(Full text of Supreme Court's opinion)
The Supreme Court also said that it agrees that spectrum or airwaves for mobile network licenses must be auctioned - a point the government accepted in February, after two judges cancelled 122 telecom licenses that were issued in 2008 by then minister A Raja in a distorted version of a first-come-first-serve policy.
The national auditor or CAG said in a report last year that the telecom scam is worth 1.76 lakh crores. Another CAG report in August said that 1.86 lakh crores were lost because the government did not auction coal fields. These two swindles, the country's largest, according to auditor, were enabled because the government did not auction spectrum and coal fields. The government has been arguing that a competitive bidding process would have led to increased costs which would have adversely impacted consumers and the industry. The Supreme Court appears today to have accepted that point of view. "Where revenue maximization is not the object of a policy of distribution, the question of auction would not arise...revenue considerations may assume secondary consideration to developmental considerations," the court said.
In February this year, when the Supreme Court cancelled the licenses given by Mr Raja in 2008, it said that a get-in-line policy was fundamentally flawed because it favours those "with access to the corridors of power" and that all natural resources must be auctioned by the government.
The government then asked for a Presidential reference -it sought a clarification from the Supreme Court on whether its stand on an auction, as expressed in the telecom or 2G verdict, applies to other national resources.
The government has seized the opinion offered by the Supreme Court today to counter the damage done to its image and reputation by the CAG reports.
"Today if you looked at the CAG report, you would also have to take into consideration what these five judges have said," Law Minister Salman Khurshid said.