GS2 (Polity and Governance)
Recently the government has demonetised Rs 500 and Rs 1000 notes. The government has said that the decision will help combat terror financing and corruption. Explain how demonetisation will help achieve each of these objectives. What are the costs of the demonetisation?
GS1 (Indian Society)
Critics point out that India’s population control policy is soft towards the male participant, which has led to many negative implication for women. Highlight those implications and also point out what changes are required in India’s population policy.
In April 2016, there were more than 20 million cases pending in the Indian districts courts; two-thirds were criminal cases. 1 in 10 have been pending for more than 10 years. That means 10% cases have > 10 years of backlog!
Shortage of judges in the judicial system is not the only reason for mounting pendency of cases in India. Law Commission of India Chairman and former Supreme Court judge Justice Balbir Singh Chauhan said that the approved strength of judges are enough to end backlog.
In fact, the law ministry was found saying that the judge-population ratio was a poor substitute for sound scientific analysis to arrive at the real reasons behind huge pendency.
#1. Lack of IT prowess: Lack of proper court management systems and inadequate administrative staff
#2. Human Resource Issues: Quality of lawyers being produced en masse by barely regulated law schools, civil procedure rules that still date back to the first decade of the 20th century
#3. Increasing awareness in Public: Workload has increased because of an increase in awareness among the public and education. There has been an expansion of liberty and courts are bound by the public’s faith in the judiciary
#4. Void of Technical Expertise: In the increasingly complex field of law, specialised knowledge has become indispensable. But very often company and patent cases are listed before judges who have been familiar with criminal cases, and the latter class presented before judges who are adept in civil cases. There is an urgent need of creating specialized benches.
#5. Proliferation through Special Leave Petitions (SLPs): A lot of cases are entertained under article 136, which would otherwise not fall in the criminal/appellate/advisory jurisdictions.
Article 136 deals with extraordinary power of the apex court to grant special leave in cases. The Supreme Court may, in its discretion, grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India.
#6. Attitudinal Issues: Frequent transfers of judges takes the interest out of them to hear the cases that their successor may give judgement to
The 245th Law Commission Report on “Arrears and Backlogs: Creating Additional Judicial (W)omanpower has recommended the following measures
1. Calculating Adequate Judge Strength through a more scientific analysis of data – In this context, the Commission has negated a simplistic method like Judge-Population ratio (Number of judges required per million people) in favour of a Rate of Disposal Method.
In the Rate of Disposal Method, one looks at the current rate at which judges dispose of cases. Then, given that the institutions and disposal rate remain the same, the Courts would need how many more additional judges to keep pace with the new filings in Court so that the newly instituted cases do not add to the existing backlog.
2. Judges to be appointed on a Priority basis: India currently has 1/5th of the number of judges it needs and thus, the Judges need to be appointed on a priority basis.
3. Increasing the age of retirement for Subordinate Court Judges to 62 years.
4. Creation of Special Courts for traffic/police challan cases: They constitute about 37.4% of the existing pendency before the subordinate courts.
5. Provision for staff and infrastructure
6. Periodic Needs Assessment by High Courts: Monitoring the rate of institution and disposal of cases and revising the adequate strength of Judges since a High Court is equipped with all the information relating to the subordinate courts in the State. The Malimath Committee had recommended setting up of Vigilance Cells in each district by the High Court to monitor the performance of subordinate judicial officers.
7. Uniform data collection and data management methods: to bring in greater transparency.
8. Need for a system-wide reform: The Commission has recommended the following:
● Greater encouragement to Alternative Dispute Resolution (ADR) and Lok Adalats <Can you tell us the difference among various types of ADRs, mediation, arbitration and conciliation? Answer in comments>
● Setting up non-mandatory time frames and performance benchmarks for resolution of different types of cases based on rational criteria.
9. Use of Technology : Has been recommended by the 230th Law Commission Report and the Malimath Committee Report to
(a) Club cases filed on similar points of law, which can be decided on the basis of a single judgment.
(b) Track old cases, which have become infructuous and dispose them off quickly
(c) Setting up E-Courts and ushering in E-filing. Has received a major boost under the e-Courts Integrated Mission Mode Project.
10. Creation of All-India Judicial Service: Provided for under Article 312 of the Indian Constitution. The idea has been mooted by various bodies including the First Judicial Pay Commission and accepted by the Supreme Court. Art 2012 proposal regarding creation of this service has not received responses from all States and this proposal continues to be hanging in the air <can you tell us the procedure of creation of new all India service? Answer in comments>
Many steps are currently being taken by the Government and the Courts to address this problem.
Monthly National Lok Adalats are carried out for expeditious disposal of claims.
In March 2016, the Monthly Lok Adalat disposed of about 1.5 lakh cases and settled claims worth Rs. 100 crores <Where can one appeal against the decision of Lok Adalats. Also tell us about the jurisdiction of Lok Adalats. Answer in comments>
In criminal cases, the setting-up of fast-track Courts and “plea bargaining” have further expedited matters <Can you tell us what’s plea bargaining? Answer in comments>
The e-courts project, aimed at providing better Court management and a database of all pending cases with easier filing of important documents is underway.
Moreover, the National Litigation Policy 2015 is awaiting ministerial approval and seeks to reverse the trend of Government being the biggest litigant <Did you know one of the argument for rejecting NJAC was that govt was the biggest litigant, therefore can have no role in appointment of judges>.
However, in view of the burgeoning backlog and urgency of reducing backlog, the efforts need to be severely expedited.
GS4 (Ethics)
Mahatma Gandhi once said “If, instead of insisting on rights, everyone does his duty, there will immediately be the rule of order established among mankind”. Do you agree with this? What does mean in today’s world?
GS3 (Science and Technology)
Despite government’ s focus on the food processing industry, statistics show that many of the mega food parks announced by government have either not been opened or are on verge of shutdown. Analyse the factors for this trend and suggest what needs to be done?
GS2 (Polity and Governance)
Indian prisons have been suffering from overcrowding of prisons, with a large number of undertrials. Discuss the causes for the same, the consequences and the measures needed to decongest the prisons in India.
GS1 (World History)
The collapse of Soviet Union coincided with the collapse of Communism as a concept. What factors were responsible for the collapse of communism in Soviet Union and why it still does not survive in many places in the world?
For a background/discussion of the topic, read this blog by K Siddhartha.
Demonetization is the act of stripping a currency unit of its status as legal tender. Demonetization is necessary (this happened when Euro was introduced) whenever there is a change of national currency. The old unit of currency must be retired and replaced with a new currency unit.
What is legal tender?
The coins issued under the authority of Section 6 of The Coinage Act, 2011, shall be legal tender in payment or on account i.e. provided that a coin has not been defaced and has not lost weight so as to be less than such weight as may be prescribed in its case: –
(a) coin of any denomination not lower than one rupee shall be legal tender for any sum,
(b) half rupee coin shall be legal tender for any sum not exceeding ten rupees,
Every banknote issued by Reserve Bank of India ( ₹ 2, ₹ 5, ₹ 10, ₹ 20, ₹ 50, ₹ 100, ₹ 500 and ₹ 1000) shall be legal tender at any place in India.
What India witnessed on 8th november 2016 was the not the first time we plugged and play the demonetization game.
1946: Rs1,000, Rs5,000, and Rs10,000 notes were taken out of circulation in January 1946. The Rs10,000 notes were the largest currency denomination ever printed by the Reserve Bank of India, introduced for the first time in 1938. All three notes were reintroduced in 1954
1977: The Wanchoo committee (set up in 1970s), a direct tax inquiry committee, suggested demonetization as a measure to unearth and counter the spread of black money. However, the public nature of the recommendation sparked black money hoarders to act fast and rid themselves of high denominations before the government was able to clamp down on them!
The High Denomination Bank Notes (Demonetisation) Act deemed the Rs 1,000, Rs 5,000 and Rs 10,000 notes illegal for the second time. At the time, then-RBI governor I.G. Patel disagreed with the measure.
2016: Recommendations of SIT on Black Money as Contained in the Fifth SIT Report
Cash transactions : The SIT has felt that large amount of unaccounted wealth is stored and used in form of cash. Having considered the provisions which exist in this regard in various countries and also having considered various reports and observations of courts regarding cash transactions the SIT felt that there is a need to put an upper limit to cash transactions. Thus, the SIT has recommended that there should be a total ban on cash transactions above Rs. 3, 00,000 and an Act be framed to declare such transactions as illegal and punishable under law.
Cash holding : The SIT has further felt that, given the fact of unaccounted wealth being held in cash which are further confirmed by huge cash recoveries in numerous enforcement actions by law enforcement agencies from time to time, the above limit of cash transaction can only succeed if there is a limitation on cash holding, as suggested in its previous reports. SIT has suggested an upper limit of Rs. 15 lakhs on cash holding. Further, stating that in case any person or industry requires holding more cash, it may obtain necessary permission from the Commissioner of Income tax of the area.
With full backing, for the third time, India participated in the process of demonetization. RBI governor, Urjit Patel applauded Modi’s “very bold step” which addresses concerns about the “growing menace of fake Indian currency notes.”
A better sense of this can be gauged from this graph below. As you can see, the monetary value of Rs500 and Rs1,000 notes in circulation far outstrips any other denomination.
Putting it simply, at the stroke of midnight, a little over 80% of the cash in India (by value) will be worthless pieces of paper.
When a currency has notes of higher denomination, it is easier to launder money i.e. store black money, as it takes less space and weighs less as well.
1. Jan Dhan scheme, under which 22-crore new bank accounts were opened in one-and-a-half years (May 2016), was the first truly game-changing move. Most of these accounts brought those people into the network who were outside the ambit.
According to the Economic Survey for 2015-16 released in February this year, leakages in LPG subsidy transfers fell 24 percent and the exclusion of beneficiaries had been greatly reduced, thanks to the infrastructure created by Jan Dhan accounts, Aadhaar and mobile networks, or the JAM trinity.
2. The next step was to bring back black money stashed away in tax havens or foreign banks abroad and here.
3. Then came the Income Declaration Scheme. By 30 September, all illegal asset holders had the chance to declare their holdings and pay 45 % tax and a penalty in exchange for anonymity and immunity from criminal proceedings.
The tax department has reported Rs 65,250 crore worth of black money from 64,275 declarations. This means about Rs 30,000 crore will flow into the government’s tax kitty.
#3. Prepare for the challenges of cashless economy: The UPI (unified payment interface) system is likely to be fully operationalised only by January 2017. India was recently hit by one of its biggest financial security breaches compromising hundreds of thousands of debit cards. Read more about Cyber Security challenges from here
Reference:
http://thewire.in/78694/paper-money-ban-rs-500-rs-1000-notes-explained/
http://www.firstpost.com/politics/rs-500-1000-notes-ban-jam-trinity-overseas-haul-how-pm-modi-is-winning-the-war-against-graft-3097176.html
http://indianexpress.com/article/business/economy/ambit-capital-black-economy-shrinking-pegged-at-20-per-cent-of-gdp-2835783/
GS4 (Case Study)
Trupti and Pallavi are two college-friends working in the same project in a reputed Information Technology company. Both are hardworking employees and their friendship is quite strong. One late evening, while leaving office, Pallavi saw Trupti taking printouts of the software code being developed by the team.
The company has strict rules regarding the use of company property and it doesn’t allow employees to take work home or to take printouts of codes. Early this year, the company had fired two employees who were found to have violated these rules.
Pallavi knows that Trupti comes from a humble background and this job is very important for the financial security of her family.
(a) The following are some suggested options. Please evaluate the merits and demerits of each of the options:
1. Report to the higher management about the incident.
2. Talk to Trupti about the issue and try to convince her to stop doing this act.
3. Ignore the act as it does not directly concern you.
(b) Also indicate (without necessarily restricting to the above options) what you would like to advise, giving proper reasons.
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GS3 (Agriculture)
The future of India’s food security lies in genetically modified crops. Critically comment on the statement in the light of the recent GM Mustard issue.