Judiciary: the biggest economic bottleneck

Nitin Potdar | Updated on: Mar 09, 2018


The best way to deal with case backlog is to create a collaborative environment, as demonstrated in income tax matters

The country’s legal and judicial systems play a crucial role in deciding the pace and quality of its economic performance. The World Bank Report on Doing Business has identified streamlined court processes and faster contract enforcements as the paramount factor shaping efficient and effective business environments worldwide. In fact, the backlog of more than three crore court cases is by far the biggest impediment to the Prime Minister’s call to ‘Make in India’ as also his aspiration to improve India’s Ease of Doing Business ranking.

The discussion has assumed importance again with the latest directive, by the current Chief Justice of India HL Dattu, asking high court judges to file verdict details that also reflect qualitative assessments.

Efforts to speed up Many governments have, in the past, attempted to speed up the judiciary. The previous law minister, Veerappa Moily, had outlined an ambitious road map to reduce litigation life from 15 years to 3 years, the inception of as many as 5,000 supplementary courts to be serviced by more than 15,000 retired judges, and setting up separate commercial courts for high value disputes.

Likewise, the former CJI AM Ahmadi had called for head-wise classification of cases and their ensuing allotment to specific benches for specific terms to ensure quick clearance. We have, from time to time, heard about the acute need for robust computerisation and intelligent case management. Although these are logical recommendations, they are long-term measures involving substantial lead times and cost.

We should welcome the income tax department’s momentous recent decision of not filing an appeal against the Bombay High Court decision in the case of Vodafone. The unconditional acceptance of the attorney general’s opinion is a step of far-reaching positive consequences.

Today, the number of cases filed by or against the revenue department total more one crore. These disputes can be categorised subject-wise and then deliberated internally amongthe tribunal heads under a team of retired Supreme Court judges aided by the attorney general and the finance minister, if required.

This in itself would substantially reduce the courtroom burden. It would also revive the reputation of the tax department.

Practical solutions Similarly, the labour minister can demand categorisation of disputes under provident fund, gratuity or industrial laws before passing them through the funnel of resolution. Thousands of cases and appeals are pending under various State and municipal laws. There’s a lot to be achieved by consensual collaboration.

Each ministry can form a small team and request a retired Supreme Court judge to opine on pending disputed issues and direct the departments to effect a fast resolution. This may well script a revolution in the Indian judicial system. Law colleges, public institutions and industry chambers must come forward to initiate and support these initiatives.

Bulk disposition by consensus is the only way out of the humungous backlog of civil litigation. Compounding is another process to clear backlog in bulk.

Setting up Supreme Court benches in Mumbai, Chennai and Kolkata would help thousands of litigants who otherwise end up travelling all the way to Delhi. The Bombay Lawyers’ Association has already proposed the idea of an apex court bench in Mumbai while the Law Commission of India has been consistently recommending that Supreme Court benches be set up in Chennai, Hyderabad, Kolkata and Mumbai.

We can gainfully follow the Chinese model where law students are encouraged to appear for the national judicial examination to ensure a steady pipeline of quality judges at least in the lower judiciary. We can emulate the Singapore model of massive computerisation for case management and technological framework. Like Malaysia, we can fix disposal targets for older cases and like Italy, we can foster pre-judicial negotiations for amicable resolution.

Clearing the mounting backlog in our judicial backyard is certainly doable with strong political will.

The writer is the M&A partner at J Sagar Associates. The views expressed are personal

Published on February 19, 2015
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