Judiciary must be very cautious in diluting government's economic policy: SC

Judiciary must be “very cautious and circumspect” in diluting or setting aside an economic policy of the government, the Supreme Court observed on Wednesday.

A Bench of Justices Madan B. Lokur and Deepak Gupta said courts must intervene against an economic policy of the government only if it was constitutionally unavoidable.

“Otherwise, good governance could be a casualty,” the court warned.

The court made the observations after quashing the Goa government’s policy to grant a second renewal of 88 mining leases with retrospective effect.

“Till recently, policy matters, particularly economic policy, were hands-off as far as the courts were concerned,” Justice Lokur observed.

However, recent decisions had seen the court “partially modify this theory and keep the window open to judicially review a policy if it does not serve the common good.”

Any economic policy in violation of Article 39(b), which mandates the distribution of “material resources of the community” to subserve common good, and Article 14, the fundamental right to equality, will be liable to challenge and judicial review, the Supreme Court held.

A policy which alienates natural resources for maximising profits of private entrepreneurs would be in violation of Article 39(b), the court held. It clarified that “there is no constitutional requirement (let alone a mandate) for allocation of natural resources through the auction method (other than spectrum).”

However, it held that at the same time “auction process should not be given the go-by without any justification.” (Source: The Hindu)