Current Affairs for UPSC IAS Exam – 16 September 2021 | Legacy IAS Academy

Contents

1. SC gives Govt. two weeks to fill all tribunal vacancies
2. U.S., U.K. and Australia – new security partnership
3. Government offers moratorium on AGR dues for telcos

SC gives Govt. two weeks to fill all tribunal vacancies

Context:

The Supreme Court accused the Centre of “cherry-picking” names for appointments to tribunals groaning under backlog and left almost defunct by long-pending vacancies.

Relevance:

GS-II: Governance (Government Policies and Interventions), GS-II: Polity and Constitution (Constitutional Provisions, Quasi-Judicial Bodies)

Dimensions of the Article:

1. About the present vacancies in tribunals
2. Constitutional provisions and mandates regarding Tribunals
3. Issues with tribunalization/tribunals

About the present vacancies in tribunals

• Chief Justice of India read out the details of over 240 vacancies in key tribunals with some tribunals even lacking presiding officers.
• The tribunals included some critical ones like the National Green Tribunal, Income Tax Appellate Tribunal and Central Administrative Tribunal among others.
• The bench also lamented the fact that recommendations to the tribunals by the selection committees led by sitting Supreme Court judges have been largely ignored by the government.

Observations by the SC

• Noting the pitiable state of tribunals and state of litigants waiting for justice from the severely under-resourced tribunals, the Special Bench of the Supreme Court has given the government a two-week deadline to make appointments to all the tribunals.
• The bench also observed how the recommendations to the tribunals by the selection committees have been largely ignored by the government and it has been “cherry-picking” names for appointments to tribunals even from the waitlist overlooking the names from the final ‘select’ list. This practice, the CJI noted, goes against the democratic principles of working under a rule of law.
• The search-cum-selection committees, headed by sitting Supreme Court judges are tasked with interviewing and short-listing suitable candidates for tribunals.

Concerns regarding vacancies in tribunals

• The large vacancies have made the tribunals ineffective and redundant.
• The large vacancies mainly attributable to the delay in appointments have rendered the tribunals defunct and with High Courts having no jurisdiction over the areas of law wielded by tribunals, litigants have nowhere to go for justice and this would adversely impact the right of the people to access justice.

Constitutional provisions and mandates regarding Tribunals

• The provision for Tribunals was added by the 42nd Constitutional amendment act which added two new articles to the constitution.
• Article 323-A: of the constitution which empowers the parliament to provide for the establishment of administrative tribunals for adjudicating the disputes relating to recruitment and conditions of service of a person appointed to public service of centre, states, local bodies, public corporations and other public authority.
• Accordingly, the Parliament has enacted Administrative Tribunals Act,1985 which authorizes parliament to establish Centre and state Administrative tribunals (CAT & SATs).

1. Central Administrative Tribunal (CAT):
   • It was set up in 1985 with the principal bench at Delhi and additional benches in other states (It now has 17 benches, 15 operating at seats of HC’s and 2 in Lucknow and Jaipur.
   • It has original jurisdiction in matters related to recruitment and service of public servants (All India services, central services etc).
   • Its members have a status of High Court judges and are appointed by president.
   • Appeals against the order of CAT lie before the division of High Court after Supreme Court’s Chandra Kumar Judgement.
2. State administrative tribunals (SAT):
   • Central government can establish state administrative tribunals on request of the state according to Administrative tribunals act of 1985
   • SAT’s enjoy original jurisdiction in relation to the matters of state government employees.
   • Chairman and members are appointed by President in consultation with the governor.

• Article 323-B: which empowers the parliament and the state legislatures to establish tribunals for adjudication of disputes related to following matters:

1. Taxation
2. Foreign exchange, Imports and Exports
3. Industry and Labour
4. Land reforms
5. Ceiling on Urban Property
6. Elections to parliament and state legislature
7. Food stuffs
8. Rent and Tenancy Rights

Issues with tribunalization/tribunals

1. Appeal: Administrative tribunals were originally set up to provide specialized justice delivery and to reduce the burden of caseloads on regular courts. However, appeals from tribunals have inevitably managed to enter the mainstream judicial system.
2. High Pendency: Many tribunals also do not have adequate infrastructure to work smoothly and perform the functions originally envisioned leading to high pendency rates thus proving unfruitful to deliver quick justice.
3. Appointments: Appointments to tribunals are usually under the control of the executive. Not only does the government identify and appoint the members of the tribunals, but it also determines and makes appropriate staffing hires. This is problematic because often there is a lack of understanding of the staffing requirements in tribunals.
4. There is a lack of information available on the functioning of tribunals. Websites are routinely non-existent, unresponsive or not updated.
5. Accessibility is low due to scant geographic availability therefore justice becomes expensive and difficult.
6. Against the principle of separation of powers: Tribunalisation is seen as encroachment of judicial branch by the government.

-Source: The Hindu

U.S., U.K. and Australia – new security partnership

Context:

The U.S. has announced a new trilateral security partnership for the Indo-Pacific between Australia, the U.K. and the U.S. (AUKUS).

Relevance:

GS-II: International Relations (Foreign Policies and Treaties affecting India’s Interests)

Dimensions of the Article:

1. About AUKUS
2. Why was AUKUS needed?
3. Five Eyes Alliance
4. Indo-Pacific Region

About AUKUS

• A new trilateral security partnership for the Indo-Pacific, between Australia, the U.K. and the U.S. (AUKUS) has been announced.
• An important aspect of this partnership would involve a trilateral 18-month effort to help Australia acquire nuclear-powered submarines.
• The partnership would also involve a new architecture of meetings and engagements between the three countries and also cooperation across emerging technologies like AI, quantum technologies and undersea capabilities.
• This trilateral grouping would be security-focused, implying that it would be different from — but complementary to — arrangements such as the Quad.
• The U.S. has announced that the new partnership is aimed at advancing strategic interests and upholding the international rules-based order, and promoting peace and stability in the Indo-Pacific.
• The three countries alongside Canada and New Zealand already share extensive intelligence through the Five Eyes alliance.

Why was AUKUS needed?

• Australia has felt increasing pressure from an assertive China. In order to balance this threat, Australia has been trying to strengthen its partnerships with India, the U.S. and the U.K to strategically balance out China.
• The U.S. too has been shifting its focus to the Indo-Pacific region given the potential of the region and also the increasing assertiveness of the Chinese whom it considers a challenger to its global dominance. In this regard, it has been focussing on strengthening bilateral partnerships with its traditional partners in Asia like Japan, South Korea, Thailand, the Philippines, and new partners like India and Vietnam. It has also been promoting new formations like the Quad.
• The U.K. has expressed its vision to engage more deeply with the Indo-Pacific.

Five Eyes Alliance

• The Five Eyes alliance is an intelligence-sharing arrangement between five English-speaking democracies: the US, UK, Canada, Australia and New Zealand, which is often described as the world’s most successful intelligence alliance.
• The alliance was created during the Cold War (1946-1991) that was fought between the United States and the Soviet Union, as well as their respective allies.
• The alliance was needed to share sensitive information regarding their adversaries on all possible fronts available.

Indo-Pacific Region

• The “Indo-Pacific” idea was originally conceived in 2006- 07. The term ‘IndoPacific’ combines the Indian Ocean Region (IOR) and the Western Pacific Region (WP) – inclusive of the contiguous seas off East Asia and Southeast Asia – into a singular regional construct.
• The idea has gained eminence in recent times due to:
  • Increasing geopolitical connect between the Indian Ocean and the western Pacific in both the geo-economics
  • Eastward shift of the world’s economic “centre of gravity” towards the Asian continent .
  • Growing Eminence of India
  • Politico-military aggressiveness of China.

-Source: The Hindu

Government offers moratorium on AGR dues for telcos

Context:

The Cabinet approved several measures to extend a lifeline to the cash-strapped telecom sector, including a redefinition of the much-litigated concept of adjusted gross revenue (AGR) to exclude non-telecom revenue and a four-year moratorium on players’ dues to the government.

Relevance:

GS-III: Indian Economy (Growth and Development of Indian Economy, Taxation), GS-II: Governance

Dimensions of the Article:

1. What is AGR?
2. The AGR Issue – Timeline
3. Impact of the Current Definition
4. Details about the new reforms
5. Significance of the new reforms

What is AGR?

Adjusted Gross Revenue (AGR) is the usage and licensing fee that telecom operators are charged by the Department of Telecommunications (DoT).

It is divided into spectrum usage charges and licensing fees, pegged between 3-5 percent and 8 percent respectively.

The AGR Issue – Timeline

• The telecom sector was liberalised under the National Telecom Policy, 1994 after which licenses were issued to companies in return for a fixed license fee.
• To provide relief from the steep fixed license fee, the government in 1999 gave an option to the licensees to migrate to the revenue sharing fee model.
• Under this, mobile telephone operators were required to share a percentage of their AGR with the government as annual license fee (LF) and spectrum usage charges (SUC).
• License agreements between the Department of Telecommunications (DoT) and the telecom companies define the gross revenues of the telecom companies.

The Contention on Definition of AGR – 14 years on

• In 2005, Cellular Operators Association of India (COAI) challenged the government’s definition for AGR calculation.
• However, DoT argued that AGR includes all revenues from both telecom and non-telecom services.
• The companies claimed that AGR should comprise just the revenue accrued from core services and not dividend, interest income or profit on the sale of any investment or fixed assets.
• In 2015, the TDSAT (Telecom Disputes Settlement and Appellate Tribunal) stayed the case in favour of telecom companies and held that AGR includes all receipts except capital receipts and revenue from non-core sources such as rent, profit on the sale of fixed assets, dividend, interest and miscellaneous income.
• However, setting aside the TDSAT’s order, in 2019, the Supreme Court of India upheld the Department of Telecom (DoT)’s interpretation of Adjusted Gross revenue (AGR), due to which telecom service providers had to pay an estimated Rs. 1.4 lakh crore to the government.

Impact of the Current Definition

Impact on Telecom Sector

• 10 of the 15 telecos that existed in 2005 have either closed operations or are undergoing insolvency proceedings in the last 14 years.
• AGR due will seriously hurt financial stability of telecom companies that are doing business in the Indian market.
• Telecom equipment suppliers may also go down as their dues will not be paid.

Impact on Banking Sector and Economy

• Banks will face the consequences of the dues as companies will be going bankrupt (non-performing assets will rise).
• The collapse of the telecom sector may increase unemployment, and reduce investment, adding to our economic and social problems.

Effect on consumers

• The failure of a few large players could lead to one or two players emerging near-monopolies.
• This leaves the Indian consumer vulnerable to high pricing, sub-standard products and lack of options.

Government will be the only winner:

• If companies are ready to pay AGR dues, it will lead to a higher contribution to the public exchequer – Meaning the Government revenue will get a huge boost and help bridge gap in the fiscal deficit and help the government finance the recovery of the economy in the current pandemic affected situation. (Note: This scenario is only possible if the companies are ready to pay the dues)

Details about the new reforms

The new reforms include nine structural reforms and five procedural reforms for the sector. Some of the major provisions are:

• The much-litigated concept of adjusted gross revenue (AGR) has been redefined to exclude non-telecom revenue and all remaining penalties have been scrapped.
• The government has also offered a four-year moratorium on players’ dues to the government.
• The regime of penalty and interest on penalty has been rationalised. Interest on dues has been maintained at a ‘reasonable’ rate.
• Foreign direct investment (FDI) in the sector has also been allowed up to 100% under the automatic route, from the existing limit of 49%.
• There would be a fixed calendar for spectrum auctions with an extended tenure of 30 years for future spectrum allocations, and a mechanism to surrender and share spectrum.
• No Spectrum Usage Charge (SUC) for spectrum acquired in future spectrum auctions.

Significance of the new reforms

• The new reforms will go a long way in addressing the telecom industry’s long-standing issues like spectrum auctioning and the AGR issue.
• The new reforms will help extend a much-needed lifeline to the cash-strapped telecom sector. The new measures will provide cash flow relief and help improve the cash liquidity scenario of the telecom companies. The moratorium of four years would ease out the stress on the cash flows of the telcos to a great extent and give enough time for the industry to carry out fundamental improvements.
• The easing of liquidity issues in telecom companies will also help various banks having substantial exposure to the telecom sector.
• The new measures will also help attract large scale investments, including for 5G technology deployment.
• The measures announced will also help generate more jobs in the Indian economy.
• Telecom reforms will boost competition and consumer interests.
• The telecom sector remains one of the prime movers of the economy and the measures announced by the government would enable the industry to achieve the goals of Digital India.

-Source: The Hindu