SC Verdict on Rafale Deal

Why in news?

The Supreme Court recently gave its verdict on the Rafale aircraft acquisition deal. Click here to know more on the deal's controversy.

What is the court's stance?

• The controversy is triggered by a media interview of former French President and press coverage alleging "favouritism" by the Modi government.
• But individual perceptions cannot be the basis of a roving judicial review and so the Court declined to intervene.
• It said it cannot sit as an appellate authority over each and every aspect of the deal.
• It refused to employ its judicial review powers to intervene in the deal's decision-making process, pricing and the choice of Indian Offset Partner (IOP).
• It agreed with government that judicial review is limited in matters of defence procurements, Inter-Governmental Agreements (IGAs) that may be vital to national security.

What is the verdict?

• The judgment came on a batch of petitions for an independent court-monitored CBI/SIT investigation into the deal.
• There was no occasion to doubt the decision-making process which led to the IGA between the French and Indian governments.
• "Minor variations" in the decision-making process should not lead to the setting aside of the contract itself.
• The court, however, restrained itself from delving deeper into the issue.
• The Court said it could not use the mechanism of judicial review to compare the prices of aircraft between the old and the new deal.
• But the judgment repeated the government's claim that the contract was of "financial advantage to the nation".
• In all, the Court held that there was no substance to the allegation that the government showed any "commercial favouritism".
• It's because it acknowledged the government stand that the choice of IOP was not in its realm; the vendor, Dassault Aviation, chooses its own IOP.

What are the concerns?

• Role - The apex court went into issues that should have been left to the Comptroller and Auditor General (CAG), and after that to Parliament.
• Neither the report of the CAG on procuring Rafale aircraft nor the Parliamentary Accounts Committee (PAC) report on it has been completed.
• So in effect, the work that should have been done by the CAG has now been rendered virtually purposeless.
• The shortcomings, if any, to be highlighted by the CAG, may be pointless as the court has already determined that nothing was wrong.
• Information - Along the way, the court asked for information from the government in sealed covers.
• This is a practice it has resorted to in other cases as well.

• But it is fundamentally contrary to the normal and accepted practice of judges hearing cases in open court.
• Contradictions - There are contradictions, too, in the judgment.
• E.g. it says “it is certainly not the job of the court to carry out a comparison of the pricing details in matters like the present”.
• But the judgement mentions on examining closely the price details and comparison of the prices.
• The correct course of action now would be for the government or the court to release the whole or at least the relevant part of what was communicated in secret.

Source: The Hindu, Business Standard