NEW DELHIâ€"India's Supreme Court upheld the government's right to sell natural resources as it sees fit, saying it wasn't necessary for the administration to use auctions.
The ruling, which was issued Thursday, was prompted by the government's petition to clarify the Supreme Court's decision in February that canceled the government's sale of 122 telecommunications licenses, which were sold at below-market prices in 2008. The court ordered the government to sell the licenses through an auction, but the Indian president's office asked the court to rule on whether all sales of national assets had to be sold this way.
On Thursday, the court said that while the judges believed that it would be better if auctions were used, it was the government's prerogative to allocate resources as a policy decision and that the order for an auction applied only to the wireless spectrum case.
The court said that if the maximization of revenue was not the goal of the sale of a national asset, then the government could use whatever methods it wanted. The judges also said that the government didn't have to always seek the highest bid because “revenue maximization is not the only way in which the common good can be subserved.â€
“This is what we were saying for last one and half years,†said Kapil Sibal, communications minister, who held a news conference in Delhi on Friday with Finance Minister P. Chidambaram and the law minister, Salman Khurshid.
Mr. Chidambaram said, “Revenue maximization may be the goal in one case, but may not be the goal in several other cases.â€
Whether or not it resorts to auctions, Mr. Sibal said, the gove rnment was committed to transparency in its dealings and has never “defended irregularities and illegalities.†The auction of the wireless spectrum is scheduled to be held later this year.
“Now the government can start taking decisions without fearing that other constitutional authority will interfere,†said Mr. Sibal. “The judgment applies to all of us. It applies to us; it applies to courts; it applies to other constitutional authorities.â€
The Congress-led government has been battling corruption scandals while it has been trying to shore up support for a ruling coalition. In August, the government was accused of losing nearly $40 billion by selling coal blocks through negotiated prices rather than through an auction.
Business associations in India called on the government to keep its transactions transparent. “Any method of allocating natural resources should be based on the principles of transparency and fairness,†Adi Godrej, president o f the Confederation of Indian Industry, said in a statement.
