Category: Litigation

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History Litigation

Robed and privileged – how advocates are protected against defamation proceedings for statements made by them in court

vijayaraghavannarasimhamMukul Rohatgi, the Attorney General for India, reportedly said during proceedings before the Supreme Court that the collegium had appointed many undeserving and inefficient judges to the apex court and high courts who went on to “create havoc” in the country. To argue that it was a myth that only judges could appoint good judges, he submitted in a closed envelope, a list of eight cases of what he called “bad appointments and selection” and referred to the questionable conduct of many judges.

Can proceedings be initiated against the Attorney General for these statements bordering on defamation? Do the affected lot have a remedy?

“In many settings, if we called someone a liar, cheat or incompetent or worse, we might be on the receiving end of a defamation claim. If we need to say that during litigation, we’re generally protected by the litigation privilege. The litigation privilege confers absolute immunity from defamation claims for statements made during both judicial and quasi-judicial administrative proceedings. The privilege applies to attorneys, parties, judges and witnesses. To qualify for such privilege, the statement must meet two general tests. First, it must have some reference to the subject matter of the litigation. Second, it must be made in connection with a judicial proceeding.”

This is the statement of law from American Jurisprudence. The privilege is traceable to the “public policy of securing to attorneys as officers of the court, the utmost freedom in their efforts to secure justice for their clients”. The privilege therefore, is absolute.

But for a subtle change made by the House of Lords recently in Arthur J.S Hall and Co. v. Simons, the British precedent would have been identical. Attorneys continue to enjoy absolute immunity in addressing courts during the proceedings from being sued either in civil law or under the criminal dispensation, but this case removed the immunity enjoyed by advocates from being sued for ‘negligence’.

Defended against a civil claim – many Madras High Court decisions

Closer home, on January 1, 1800, the legendary Eardley Norton was sued by Sullivan, a member of Madras Civil Service for defamatory conduct in addressing the members of the jury in a criminal trial. A full bench of five judges of the Madras High Court ruled that Norton enjoyed

The legendary Eardley Norton

The legendary Eardley Norton

absolute privilege from being sued in civil law for damages. In the absence of proof that Norton was actuated by malice and because the allegedly defamatory utterance was not alien or irrelevant to the matter in inquiry, the High Court accepted Norton’s defence, “I acted under my instructions: all I said and did was within the four corners of those instructions and my duty to my client compelled me to say what I said”.

On December 2, 1926, the Madras High Court relied on Sullivan v. Norton and decisions from the Bombay and Calcutta High Courts in Thiruvengada Mudali v. Thirupura Sundari Ammal and ruled that when the statement imputed with defamatory content was made in the course of a necessary line of submission to aid the cause of a client, then even the presence of malice will not override the presumption of good faith. Advocates who have been accused of defamatory conduct are also protected by the Bombay High Court’s decision in Navin Parekh v. Madhubala Shridhar Sharma, which in fact relied on the ninth exception to Section 499 of the Indian Penal Code, 1860.

When “imputation was made in good faith (which is always presumed) for the protection of interest of the person making it, or of any other person, or for the public good”, then such utterance would not amount to defamation. In February 2008, the Madurai Bench of the Madras High Court again rescued an advocate from facing criminal prosecution for allegedly making defamatory statements in the course of pleadings in a suit for partition.


CriminalDefamation_NinthExceptionA thinner defence against criminal defamation

All may not be lost for persons affected by such submissions. In its decision in Sanjay Mishra in March 2012, the Delhi High Court drew a subtle distinction between English and Indian law.
While in England, there is total immunity for a counsel for such conduct from being proceeded against either for damages in a civil action or under criminal law, that level of protection os confined to a civil action alone in India. Under the criminal law of defamation, the ninth exception to Section 499 actually enables parties to sue a counsel if they can demonstrate malice or a lack of good faith in the utterance or conduct. That, however, is too thin a line, especially in a case of the kind that the Attorney General was arguing – a one-off case, where the submissions were not too alien either.

Vijayaraghavan Narasimhan is an advocate practicing at the Madras High Court.

 

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Litigation Specialised

Where to file suit for copyright infringement? Supreme Court’s purposive interpretation amounts to re-writing the Copyright Act

vijayaraghavannarasimhamA plain reading of Section 62 of the Copyright Act, 1957 will reveal that Section 62(2) of the Copyright Act is an exception to the general rule vesting jurisdiction in a civil court in case of ‘infringement of copyright in any work’.

Under Section 62(1), such a suit has to be instituted before ‘the district court having jurisdiction’ in respect of the ‘infringement of copyright in any work’.

The general rule, seen in Section 20 of the Code of Civil Procedure, 1908 (“CPC”), is that a civil proceeding complaining of ‘infringement’ has to be instituted where the ‘cause of action’, that is, the ‘infringement’ arose, or where the defendants reside or carry on business.

S62CopyrightAct S20CPC

Section 62(2), however, has a non obstante clause vis-a-vis Section 20 of the CPC and any other law in force. Therefore, only Section 62 is invoked to determine whether such a suit is territorially tenable.

Section 62(2) thus makes an exception to Section 62(1). It means that a ‘district court within whose jurisdiction plaintiff resides or carries on business’ is also a place of permissible jurisdiction. This necessarily means that even if the ‘infringement of copyright in a work’ arose within the jurisdiction of Court A, the suit can be filed by the plaintiff in Court B, within whose jurisdiction he resides or carries on business.

Once the plaintiff proves that he was residing at the chosen venue or he was carrying on business there, he can surely sue at that location. The plaintiff need only show that he was ‘actually and voluntarily residing’ there or ‘carrying on business’ or personally working for gain. Once these ingredients are satisfied, the suit has to be held maintainable. In effect, the criteria under Section 20 of the CPC, that is, where the ‘cause of action’ arose or where the ‘defendant was residing’ or ‘carrying on business’ are rendered otiose.

The reasoning behind creating this exception was that an artist must have total control and dominance over his ‘copyright in a work’. The artist has the right to carry his right to sue wherever the artist resides or moves to reside or carries on business or moves to carry on business, irrespective of where the cause of action or infringement arises. It is a clear and lucid departure from the ordinary rule of territorial jurisdiction.

How Sanjay Dalia rewrote the Copyright Act, all in the name of “purpose”

Unfortunately, in one more exhibition of the ‘purposive interpretation’ rule, the Supreme Court has affirmed the decision of the Delhi High Court in Indian Performing Rights Society Ltd. v. Sanjay Dalia.

The plaintiff was carrying on business through a branch office in Delhi though their head office was in Mumbai. The alleged ‘infringement’ had taken place in Mumbai. The concurrent findings of the Delhi High Court declining to entertain the suit in Delhi was affirmed by the top court.

“In our opinion, the provisions of section 62 of the Copyright Act and section 134 of the Trade Marks Act have to be interpreted in the purposive manner. No doubt about it that a suit can be filed by the plaintiff at a place where he is residing or carrying on business or personally works for gain. He need not travel to file a suit to a place where defendant is residing or cause of action wholly or in part arises. However, if the plaintiff is residing or carrying on business etc. at a place where cause of action, wholly or in part, has also arisen, he has to file a suit at that place, as discussed above.”

‘Purposivism’ and ‘consequentialism’ cannot be used to tide over the ‘convenience or inconvenience’ of parties. When the Parliament has conferred on the plaintiff, the right to sue for infringement wherever he resides or carries on business, is the Supreme Court right in concluding that plaintiff could not do so in a case where the infringement arose in Mumbai and defendant carried on business in Mumbai and plaintiff also had its head office? This amounts to re-writing the legislation. Oh, for an Antonin Scalia dissent of the Obamacare and Obergeleff genre.

Vijayaraghavan Narasimhan is an advocate practicing at the Madras High Court.

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Litigation Specialised

Statutory reform alone will not make domestic arbitration more efficient – A closer look at the Law Commission’s 246th Report

SindhuSivakumar_DraftingForArbitrationThat arbitration in India is a costly, time-consuming, and inefficient affair is well known. Excessive court applications, exorbitant arbitrator fees, and respondent recalcitrance are the norm and in many ways, arbitrations do not provide a better and more efficient alternative to the courts for the resolution of commercial disputes. Only if this important objective is achieved can arbitration promote trade, commerce, and investment.

The Law Commission of India, on August 7, 2014, released its 246th report (“Report”), suggesting amendments to the Arbitration and Conciliation Act, 1996 (“ACA”) to make arbitration in India more efficient. With the Union government indicating that it will implement statutory reforms to the ACA soon, let us first look at some aspects of arbitration practice in India that the Report has identified as being at the root of the inefficiency.

No ‘institutional’ arbitration

‘Institutional’ arbitration is carried out under the administration of a specialised institution, like the London Court of International Arbitration (“LCIA”) or the Singapore International Arbitration Centre (“SIAC”) and in accordance with their rules. In ‘ad hoc’ arbitrations, the parties determine all aspects of the arbitration themselves. Institutional arbitrations typically tend to be better regulated and therefore, less inefficient as they involve detailed procedural rules, tighter timelines, reasonable (arbitrator) fee schedules, and administrative oversight.

Exorbitant ‘per sitting’ fees

The fees that are typically charged by arbitrators in Indian ad hoc arbitrations not only drive up costs, but also disincentivises arbitrators from conducting arbitrations speedily (that is, with fewer sittings).

Adjournment culture

Parties seek and receive too many adjournments over the course of the arbitration and arbitrators do not use cost sanctions to check any wasteful or dilatory conduct.

Wide scope of judicial enquiry

The judiciary has unnecessarily widened the scope of judicial enquiry when hearing arbitration applications. For instance, Section 11 appointments have been characterised as a ‘judicial’ function. This has subjected them to the lengthy Special Leave Petition process. Similarly, when hearing set-aside applications under Section 34, awards are re-opened and reviewed on merits based on the ‘public policy’ ground.

Perverse statutory incentives that increase arbitration-related court applications

A party who challenges an award under Section 34 can obtain the statutorily created ‘stay’ of the enforcement of the award under Section 36. This has led to losing parties routinely filing set-aside proceedings to delay the enforcement of an award.

Let us delve deeper into the Report’s recommendations to disentangle arbitration from the courts, specifically its recommendations to reduce the scope of judicial enquiry in arbitration-related court applications.

The first problem is one of ‘judicial overreach’, that is, the trend of Indian courts expanding the scope of judicial review in arbitration-related court proceedings, undercutting the spirit of judicial minimalism in the ACA. The other is the volume of arbitration-related court proceedings in domestic arbitration in India. We will concentrate on the first problem.

Expansive judicial review in arbitration-related court proceedings

There has been a lot of academic and practitioner-led literature in this regard, particularly in the context of:

– Section 5 of the ACA, which has been read down to make it subject to the inherent powers of the civil courts under Sections 9 and 151 of the Code of Civil Procedure, 1908;

– Section 8 of the ACA, which has also been interpreted to allow the courts to get into issues relating to the validity, operability, and enforceability of the arbitration agreement notwithstanding its express exclusion by the drafters of the ACA, worsened by the fact that the courts often encroach upon the jurisdiction of the tribunals and decide substantive issues in dispute when hearing challenges to the arbitration agreement;

– Section 11 of the ACA, under which the arbitrator-appointment function of the courts has been converted from an ‘administrative’ function to a ‘judicial’ decision, which can be subject to lengthy appellate proceedings through the SLP route; and

– Section 34 of the ACA, under which the ‘public policy’ ground for challenging awards has been expanded to such an extent that it is now essentially the same as a regular appeal on law under the Code of Civil Procedure, 1908.

The Report echoes existing popular opinions and recommends on reducing the scope of judicial review in these proceedings. For example, it clarifies that Section 11 appointments should be regarded as administrative acts (not subject to review through the SLP process).

Judicial review of issues related to the validity of arbitration agreements and the arbitrability of disputes

Further, the questions that a court can get into when hearing Section 11 and Section 8 (stay) matters should be limited to issues regarding the existence or validity of the arbitration agreement as well as issues of arbitrability, but not questions regarding the scope of the arbitration agreement or the merits of the dispute (which includes issues relating to the validity of the underlying contract). Essentially, the Report echoes the position taken by the Supreme Court in National Insurance Co. Ltd. v. M/s. Boghara Polyfab Pvt. Ltd. (September 18, 2008) and other such cases.

The Report also clarifies what matters the court can and cannot determine when hearing challenges to the arbitrability or the arbitration agreement under Sections 8 and 11. Again, it echoes what was said in Boghara Polyfab Pvt. Ltd., that is, that the court can decide questions of (i) whether it (the relevant court) has jurisdiction to hear the application; (ii) whether there is a valid and enforceable arbitration agreement; (iii) whether the party who has applied is a party to such an agreement; (iv) whether the claim that is subject to arbitration is a dead claim (barred by limitation) or a live claim; and (v) whether the disputes subject to arbitration have been settled.

Tightening the ‘public policy’ ground used to set aside awards

In relation to Section 34, the Report seeks to tighten the ‘public policy’ ground for setting aside arbitral awards to discourage the courts from interpreting this ground widely and reviewing awards on merits. The Report refers to Renusagar Power Co. Ltd. v. General Electric Co. (1994), where the Supreme Court, in relation to a challenge to the enforcement of a foreign award, interpreted the meaning of the ground, “in conflict with the public policy of India”. The Court held that the term ‘public policy’ meant: (i) fundamental policy of Indian law; (ii) the interests of India; or (iii) justice or morality. The Court categorically held that contravention of law alone will not attract the bar of public policy.

The Report suggests that ‘public policy’ be confined to (i) and (iii) above in the context of international arbitrations seated in India, that is, that challenges based on the award being against the interests of India be disallowed. For domestic awards however, courts should be permitted to check the award for “patent illegality” when there is a challenge under Section 34.

These suggestions are commendable and mostly in line with what practitioners and commentators suggest. However, it is not clear whether they will make a difference in practice, as their application and interpretation remains at the hands of the judiciary, which has traditionally expanded the scope of its role in arbitration-related court hearings.

For example, in relation to challenges to the arbitration agreement, it is not difficult to envisage a situation where a court decides to delve into the substantive issues in dispute, such as the validity of the underlying contract, when it is framed as part of a challenge to the validity of the arbitration agreement (as the lower courts did in Enercon), or declare an agreement “inoperable” when there are pending proceedings before the courts relating to matters subject to the arbitration agreement (as the Delhi High Court did in Vikram Bakshi and Another v. Mc Donalds India Pvt. Ltd. and Others, I.A. No.6207/2014). Likewise, the public policy criteria in Section 34 – “justice or morality” and “fundamental policy of Indian law” can easily be interpreted by the courts in a wide manner. The point is simple. Statutory reforms by themselves do not protect against an interfering judiciary; much of the effectiveness of these reforms depends upon the judicial approach to arbitration-related court proceedings.

The large volume of arbitration-related court applications is another, and perhaps even more important aspect, of the problem of arbitration-court entanglement in India. This not only slows down arbitration, but also adds to the arrears before our already overburdened civil courts. The suggestions in the Report in this regard are quite far reaching and deserve closer attention.

(Sindhu Sivakumar is a solicitor on the rolls of England and Wales and qualified as an advocate in India.)

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Litigation Specialised

Behind the pipeline – legal strategies to combat unknown sources of water pollution

CommunitiesAndLegalAction_KanchiKohliIt was a hot summer afternoon in central India. Four of us had spent all morning taking a close look at an underground coalmine, its housing colonies, roads, transportation area, and other support infrastructure. We stopped to chat with workers at a local teashop. Even though we were fascinated and moved by their stories, we had to move on.

We had come to this place to understand how an important river had been polluted and the impact of this pollution. For many villages, this river and its feeder streams were important sources of water for drinking and for irrigation.

Across the road from the boundary wall of the mine, visible under a muddy patch of the road where we stood, was the mouth of a metal pipe. It was discharging thick black slurry. The slurry was heading straight into a stream flowing along the road. It was difficult to ascertain the source of the slurry in the pipe. Instead of following the pipe, we decided to follow the slurry.

After walking along the stream till it was not possible to trek any further, we met a resident of the area. “This polluted stream meets our river”, he said. “We are not able to use water from the river confidently any more. We are not even sure if it is fit for cattle. We have no clue what the black slurry is bringing with it.”

It was true. When we drove down towards the main river, we saw that it had been contaminated. There was no way to tell whether the water was poisonous or not. But it was clear that the discharge from the pipeline had been collecting on the river bed and blocking the easy flow of the river. Other residents of the area told us that the water flow is much stronger on some days.

Picture courtesy Kanchi Kohli

Picture courtesy Kanchi Kohli

To me, the veracity of their apprehension was just as big a question as whether the discharge should have been allowed in the first place. Since no one really knew who was responsible for constructing the pipeline and getting away with the effluent discharge, we had to understand the possible legal options for two scenarios – one where we knew who was responsible for the effluent discharge and one where that was not the case.

Almost all industries, mines and infrastructure activities where there is possibility of water extraction or water contamination are regulated at least by two laws: the Environment Protection Act, 1986 (“EPA”) and the Water (Prevention and Control of Pollution) Act, 1974 (“Water Act”). These industrial activities or processes would have also had to take approval under the Environment Impact Assessment Notification, 2006 (“EIA notification”) and seek consent under the Water Act.

When the source of pollution is known

If formal or informal sources indicated that the underground mine was indeed the source of the pollution, the course of action would be to immediately collect copies of the permissions granted under the EIA notification and the consent to operate letter from the relevant pollution control board.

Both the EIA-related permission (“environment clearance”) and the “consent to operate” are likely to have conditions related to how the polluted water to should be treated and where it should be discharged.

For instance, an environment clearance letter would say: “Mine water discharge and/or any wastewater should be properly treated to conform to the prescribed standards before reuse/discharge”. If this was mentioned in the approval given to the underground mine, then the discharge of the slurry into the stream would constitute a legal violation.

Sections 25 and 26 of the Water Act would also specifically be applicable to the underground mine. The project owners would have had to seek an approval from the Pollution Control Board clearly indicating the quantum and place of discharge. In their “consent to operate” letter, it is likely that the Pollution Control Board would have mentioned that coal waste should not be released into the neighbouring stream.

Environment clearance is a one-time permission given either by the Ministry of Environment, Forests and Climate Change or a state environment impact assessment authority. On the other hand, the consent to operate needs to be renewed every year by the relevant pollution control board, in charge of checking water pollution. For industries, the validity of the approval is five years to initiate the operations. No renewals are required thereafter. It is these pollution control boards or their regional offices, which also monitor whether these conditions are being followed.

When the source of pollution is not known

“But, there is no way we can find out the source of the pipeline. Only the discharge point is visible to us. However, we know that every 10-12 days, the discharge is much heavier than other days and the river is dark. Is there anyone we can complain to about this? , a teenaged schoolgirl, who had been overhearing our conversation, asked.

The Water Act has a clear objective of “prevention and control of water pollution and the maintaining or restoring of wholesomeness of water”. Pollution control boards (“PCBs”) set up under this law, have the responsibility for ensuring this. In fact, since 1974, these PCBs have been empowered by Section 17 (a) of the law to “to plan a comprehensive programme for the prevention, control or abatement of pollution of streams and wells”

Section 24 of the Water Act relates to prohibition of the use of a stream or a well for the disposal of polluting matter, by anyone. It did not really matter therefore, if we did not know the source of pollution. The PCB or its regional office could be asked to take action. People could meet the relevant officials or, as environmental groups or people with the help of civil society organisations have often done, file a written complaint.

Not surprisingly, my explanation was dismissed by a few in the group. “Why should we take the headache of going through all this paperwork when it is the responsibility of the government”, said one of them who seemed to be visiting his village from the neighbouring town. “No one cares about our place, or river”, another remarked.

I did not have any strong reason to disagree with the second remark. It is true that many regulatory procedures related to the environment are yet to be implemented to their true potential. Close to forty years of water pollution law in India and our rivers are still being polluted.

But I responded to the former remark. There is much to be desired from our regulatory institutions and  they hide behind the excuses of lack of personnel and “pressures” leading to inaction. The filing of complaints before them however, remains an option for those who are affected. By not filing any complaints, are we not accepting the inaction? Perhaps an increase in evidence-based complaints can push the institutions to respond?

The extent to which affected people are willing to take their chances is a big question.

Kanchi Kohli is a researcher working on law, environment justice, and community empowerment.

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Human Rights Litigation

Legal aid system faces fundamental questions as scattered approach, problems with data, and state-level neglect don’t help

Sumathi_Chandrashekaran_LongRoadToJusticeReformThe Prime Minister’s now forgotten comment about “five star activists” in India’s courts provoked some introspection on public interest lawyering and legal aid systems. Some of the questions that arise do not have simple answers. For instance, do we know how much it costs to take up a cause in the court system and fight it through till the end? Do the funds allocated towards legal aid meet that requirement?

The most visible form of public interest lawyering is in that of the PIL, or “public interest litigation”. PILs came into their own in the 1980s as a form of litigation to protect the rights of people who are disadvantaged in some way or other. They necessarily involve public rights.

The cost of public interest lawyering

There is limited data on how many PILs are filed each year and on whose behalf, what course they take, and how much it costs. Varun Gauri of the World Bank, who attempted an empirical study some years ago of PILs at the Supreme Court, faced many challenges relating to the classification of cases and other data, and interestingly, concluded that only a very small number of cases were brought to the courts by co-operative entities like non-governmental organisations (“NGOs”).

The classification of cases as being those in public interest is one challenge. Identifying the costs involved is quite another. One method of studying this question is by understanding how the authorities fund the protection of the rights of disadvantaged persons. Since privately-backed NGOs are not likely to make their expenses public, public authorities are a better source of information. The government does not, as would be expected, have a budget for public interest litigation. However, it does make provision for legal aid, through the elaborately structured Legal Services Authorities Act, 1987 (“LSA Act”).

The cost of providing free legal services to the needy

The main body constituted under the LSA Act is the National Legal Services Authority (“NALSA”). It was set up in 1995 to provide “free and competent” legal services to the needy. The challenge it has faced over the years has been to ensure that this goal is really met.

NALSA’s funding has increased by more than five times between 2008-09 and 2015-16. According to the Union Budget, which apportions funds to NALSA, this money is meant to provide for “Law Officers, Legal Advisers and Counsels and also for Legal aid to the poor through National Legal Services Authority (NALSA).” It is not clear as to what portion of this amount is meant for the NALSA secretariat and its administration and management.

LegalAid_UnionBudget_NALSA

We may be able to understand NALSA’s expenditure in connection with legal aid better by dividing its budgetary allocation for a given year by the number of cases it addressed that year. Unfortunately, NALSA does not provide this data in a proper form. Its website only hosts one spreadsheet, according to which 7,178,178 cases were addressed through a lok adalat held on November 23, 2013.

Assuming that this was the only lok adalat held that year, then the approximate expense per settlement (based on the budget for 2013-14) would be a little less than Rs. 150. If more than one lok adalat was held by NALSA that year, which is a more likely scenario, then the cost per settlement would be much less. Does that seem odd? Or is it that India’s premier legal aid institution, in fact, functions with great efficiency and fiscal prudence?

Lok adalats are only a small part of NALSA’s role in providing legal aid. And that, in fact, is a major area of concern in the manner in which publicly funded legal aid services are designed in India. Under the LSA Act, the body is responsible for a host of activities.

It is supposed to assist identified categories of persons (such as women, children, members of scheduled castes and scheduled tribes, and disabled persons) in various aspects of mundane legal proceedings, such as the payment of court fees, arranging for lawyers, preparing briefs, and obtaining certified copies of documents.

It also has to host lok adalats periodically to help affected persons resolve their problems through alternate dispute resolution methods.

The NALSA is supposed to establish legal aid clinics in universities and colleges. It is also expected to periodically support the government of the day in implementing social sector schemes (such as through the Scheme for Supporting the Implementation of National Rural Employment Guarantee Scheme (NREGA), 2008).

Scattered approach, lack of data

In effect, NALSA is expected to multi-task on issues that actually need to be dealt with separately. The implementation of social sector schemes for instance, should not be mixed up with lok adalats. If the lakhs of cases that lok adalats “settle” include ensuring the issue of an Aadhaar card, is NALSA really performing its role in providing legal aid services? In fact, it appears as though NALSA has become a repository of leftovers in the legal aid landscape.

It also does not help that data on NALSA is practically absent. Besides occasional newspaper articles that claim that an extraordinarily large number of cases have been settled at a lok adalat (for example, see this), there is no information about the institution’s operations. The LSA Act requires it “to maintain up-to-date and complete statistical information, including progress made in the implementation of various Legal Services Programmes from time to time” (Section 6(g)). The information on its website (where such statistical information ought to be made available) suggests this requirement has not been met for several years.

NALSA is not the only body responsible for legal aid. It is, in fact, at the helm of an entire network of legal services authorities that permeate through the state, district, and taluka system in India.

Neglected state legal aid system poised for further neglect

The State Legal Services Authorities  (“SLSAs”) perform a role similar to NALSA at the state level. They have received funds from the Thirteenth Finance Commission grants-in-aid made to state governments, but the Fourteenth Finance Commission has changed the funding structure slightly.

Unlike previous Finance Commissions that had recommended that state governments should receive a share in tax collections as well as sector- or scheme-specific grants-in-aid, the Fourteenth Finance Commission (download report) reduced grants-in-aid, and instead recommended an increased devolution of tax revenues to state governments.

In the area of justice reform, the Finance Commission specifically endorsed a proposal made by the Department of Justice (in the Union government) to strengthen judicial systems in states, but instead of offering grants-in-aid, urged state governments to use the additional tax revenues to meet such requirements.

LegalAId_ThirteenthFinanceCommission_stateutilisation

The history of the utilitisation of the funds received by state governments from the Thirteenth Finance Commission suggests that most states are not inclined to fully use the funds they receive in aid. Since it is very unlikely that they will voluntarily allocate funds to projects that they are anyway not interested in, the future for SLSAs and legal aid at the state level does not look rosy.

In order to truly provide “free and competent” legal aid, it is essential to address some fundamental questions. What are the contours of legal aid? Is it ever-expanding and osmotic, or should it be restricted to court-related services? How many people really need free legal aid? Should there be economic criteria for providing such aid, or should criteria be socially prescribed? For instance, should every woman, regardless of her financial position, be entitled to free legal aid? How much does it cost to provide such legal aid? And what is the optimal organisational structure, if any such structure is required at all, for such an arrangement? The existing legal aid services mechanism in India needs to be urgently recast in light of these, and many other, questions.

(Sumathi Chandrashekaran is a lawyer working in the area of public policy.)