New Delhi: The Supreme Court has given state-run enterprises a free hand to pursue litigation against the government and other public sector units, recalling its earlier order barring these entities from approaching the courts directly without approval from a Committee on Disputes.
A five-judge Constitution bench headed by Chief Justice S H Kapadia observed that the government had formed the Committee on Disputes (CoD) to resolve legal issues between
PSUs and the government based on an earlier direction passed by the Supreme Court.
Under this mechanism, the PSUs were required to get the CoD's approval before seeking legal recourse to their disputes.
However, "In the changed scenario, time has come to
rethink. We recall the order passed by us," the bench said.
It recalled the previous order passed by it which said
that PSUs will have to come "only after getting approval from
the CoD comprising secretaries of various government
departments."
The apex court said that the present mechanism of CoD
has failed and indicated that the mediation started by the
body were not achieving any results, as the same set of facts
were repeated.
It further said it has taken long time to settle disputes
under the present mechanism, resulting in revenue losses for
the PSUs.
Bureau Report
First Published: Thursday, February 17, 2011, 12:35