At no time in the history of this country has there been so much animosity between states and the central government over disbursal of central funds which is the sine-qua-non of governance in a federal democracy. But since 2014 when the NDA government assumed power the opposition-ruled states have been starved of funds so much so that states have had to approach the Supreme Court (SC) on this matter. On Monday last the apex court called on the Centre and state governments to refrain from a “contest,” noting that state governments were approaching the court to seek relief against the Centre vis-a-vis the non-disbursal of central funds.
This time it was the case of the Karnataka Government that was being heard in the bench of Justices B R Gavai and Sandeep Mehta. The Karnataka Government was seeking relief from the National Disaster Response Fund (NDRF) on account of the drought that afflicted the state. It is unprecedented that state governments have to use legal means to access central funds and that the court had to reprimand the Solicitor General and the advocate appearing for the Karnataka Government – Kapil Sibal- for trading charges. The Inter-Ministerial Central Team had visited Karnataka and given its report and the funds should have been provided within a month of that report being submitted which was December 2023 but till date no funds have been disbursed. Solicitor General, Mehta said the matter could have been resolved if the state government had taken up the matter with the Centre instead of taking the matter to court and also questioned the timing which is on the eve of the Lok Sabha elections. The justices have noted that many states were approaching the Supreme Court to seek relief against the Centre in matters related to disbursal of funds. Earlier, the Tamil Nadu government had also approached the Supreme Court for non-release of funds for disaster management. Even the Kerala Government had filed a petition in the apex court after the Centre curtailed its borrowing limits. The matter is now pending before a 5-judge Constitution Bench.
According to Article 293 of the Constitution states have the right to raise borrowings from the Central government and/or other sources. The courts now have to adjudicate on whether such a right can be regulated by the Central government, and if so to what extent. Article 293 has never been subjected to any authoritative interpretation by the Supreme Court since matters never came before it. The Court opined further that the matter falls squarely within the ambit of Article 145(3) of the Constitution which provides that for the purpose of deciding a substantial question of law as to the interpretation of the Constitution or for the purpose of hearing any reference under Article 143, the number of the judges would be five. In recent times Centre-State relations and federalism are being put to the test. Opposition-ruled states are facing the rough end of the stick. Clearly this is an unhealthy trend and arm-twisting that the Modi Government appears to have used to the hilt.
