Topic 1 : The court’s trajectory
Introduction: With the decision of the Supreme Court on the electoral bonds scheme, the court back on track in its role as custodian of the constitutional letter and spirit, and as the institution that protects freedoms and liberties against state transgression.
The ups and downs in Supreme Court’s journey
- For decades, India’s Supreme Court has been admired across the globe because of its ability to resist, and stand up to, executive power.
- Till recently, the Court’s career had only been really tainted by one episode, the Emergency, about which Justice Y V Chandrachud, the longest serving Indian Chief Justice, came to show remorse later.
- Two months after he was controversially sworn in as chief justice by the Janata Party — large sections of the judiciary protested his appointment because of his habeas corpus ruling — he said in a 1978 speech: “I regret that I did not have the courage to lay down my office and tell the people, well, this is the law”.
Quashing down the NJAS was the only prominent decision of SC in a decade
- As early as July 2014, the government of Prime Minister Narendra Modi promoted a constitutional amendment in order to create a commission which would be responsible for appointing and transferring judicial officers and which would consist of the CJI, two senior judges, the Minister of Law and Justice and two “eminent personalities”.
- These two personalities would have been selected by a committee comprising the CJI, the PM and the Leader of the Opposition in the Lok Sabha.
- This bill was passed in Parliament, but the Supreme Court quashed it in 2015 because it would affect the independence of the judiciary, guaranteed, in its view, by the Collegium system.
Later decisions of SC evaded conflict with the executive
- However, the Supreme Court began to drop the ball with regard to its vigilance against the crossing of lines by the Executive.
- In 2017, the Court refused to examine a petition alleging dilution in the Whistleblower Protection Act and in 2018 it validated the Aadhaar Act that the government had passed as a money bill — like the Electoral Bonds Bill — in spite of the fact that it fell well outside the limits set by the Constitution for money bills.
- These bills solely concern taxation and government spending — that’s why they do not need to be examined by the Upper House of Parliament, something the Modi government found to be convenient because the BJP did not have the majority in the Rajya Sabha.
The famous press conference of four seniormost judges of SC
- Four senior-most members of the Supreme Court — Justices Kurian Joseph, J Chelameswar, Madan Lokur and Ranjan Gogoi — held a press conference to make their criticism public against Justice Misra’s functioning in January 2018.
- But Justice Misra’s successor, CJI Gogoi seemed to follow in his footsteps, confirming that the problem had spread to the Court as an institution.
- This was evident from the fate of crucial cases, including the electoral bonds case.
- In 2019, the Supreme Court judgment on the MLAs who had defected from Congress to BJP — enabling the latter party to form the government in Karnataka in spite of its electoral defeat — made a mockery of the Anti-Defection Law.
SC applied the ‘Judicial evasion’ principle rather than ‘Judicial activism’
- The Court kicked the can down the road on the constitutional challenge to the abrogation of Article 370, and the splitting of the erstwhile state of J&K into two Union Territories, on reservation for economically weaker sections, judicial review of money bills, electoral bonds and the challenge to the Citizenship Amendment Act.
- If what constitutional law scholar Gautam Bhatia has called “judicial evasion” remained the Supreme Court’s favourite strategy, when it did make decisions, none of them challenged the government.
- For instance, it dismissed the plea to transfer the PM CARES Fund, that had received large sums of money during the Covid-19 crisis to the National Disaster Relief Fund and upheld the validity of the draconian Prevention of Money Laundering Act (PMLA), including the investigative powers of the Enforcement Directorate.
- The 10 per cent EWS quota was upheld, as was the legality of the government’s 2016 demonetisation move, and the abolition of Article 370 as well as the downgrading of J&K into a Union Territory, which senior lawyers with an impeccable reputation, like Fali Nariman, considered as poor decisions.
Conclusion: With the decision on electoral bonds, the court seems to have retrieved some of the ground it had steadily ceded to the Executive. It remains to be seen, however, if, on this decision and in cases in the future, it can stay the course.
Topic 2 : Space to pivot
Introduction: Data released by the National Statistical Office on Tuesday showed that retail inflation, as measured by the consumer price index, has remained at almost the same level since the beginning of this year.
What is core, headline, and food inflation?
- Headline inflation refers to the change in values of all goods in the inflation basket.
- Core inflation excludes the food and fuel items from the basket and tracks the change in the values of the remaining goods in the basket.
- Food inflation only tracks the food items in the basket and brings out the change in values of food items in the basket.
The findings from the latest inflation data
- Inflation stood at 5.09 per cent in February, only marginally lower than 5.1 per cent in January.
- However, the disaggregated data points towards diverging trends — food inflation has edged upwards, while core inflation, which excludes the volatile food and fuel, has eased further.
- This represents a conundrum for monetary policy.
Food inflation has risen up
- As per the latest data, the consumer food price index rose to 8.66 per cent in February, up from 8.3 per cent in January.
- Inflation remained elevated in vegetables (30.25 per cent), pulses and products (18.9 per cent), eggs (10.69 per cent), cereals (7.6 per cent) and sugar (7.48 per cent).
- According to a note by Crisil, inflation in the TOP segment (tomato, onion and potato) has surged to 22.7 per cent.
- This would suggest that the effects of El Nino and subdued production are showing.
Core inflation is easing up
- However, at the same time, core inflation is witnessing broad-based easing.
- As per ICRA’s estimate, core inflation, which excludes food and beverages, fuel and light and petrol and diesel for vehicles, moderated to 3.5 per cent in February, down from 3.7 per cent in January.
- Inflation has eased in clothing and footwear (3.14 per cent), household goods and services (2.82 per cent), recreation and amusement (2.71 per cent).
- As per these estimates, core inflation is now at its lowest level since January 2015.
- Alongside, data released by the NSO shows that industrial production slowed to 3.8 per cent in January, from 4.2 per cent in December, driven by subdued performance of manufacturing.
- As per Crisil, growth in industrial output has been lower in the second half of the year as compared to the first.
The challenges to the Monetary Policy Committee
- In its last meeting, the monetary policy committee had chosen to maintain the status quo.
- However, the decision was not unanimous as one member voted in favour of a rate cut.
- As per RBI projections, while the economy is expected to maintain its growth momentum, inflation is expected to trend lower.
- The central bank expects growth at 7 per cent and inflation at 4.5 per cent in 2024-25.
- However, there remains considerable uncertainty around the trajectory of food inflation.
Conclusion: As greater clarity emerges over the coming months on production trends and the monsoons, it could open up space for the MPC to pivot.