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T N Ninan: The law without limit

No fewer than 218 coal mining leases have been declared illegal, some dating back to 1993. Scores of other iron ore and manganese ore mines have been shut in four states (Karnataka, Goa, Jharkhand and Odisha) – on court orders again, or on the basis of enquiry by a judge. Earlier, 122 telecom licences were cancelled by the court. All of these have resulted in, or could now result in, the shutting down of operating businesses – with easily understandable implications for banks that have lent them money, employees working there and investors. Whatever the cost and consequences, the law must be followed. Of course.

The question in my mind is this: has any court gone into the circumstances in which the finest iron ore mines in the country were given to Jamshetji Tata more than a century ago? If no proper procedure was followed at the time, shouldn’t those leases to Tata Steel be declared illegal? And since Tata Steel has enjoyed a cost advantage for over a century because the excellent quality of its iron ore has helped it make the cheapest steel, shouldn’t the benefits of that unfair advantage be shared with the state – with retrospective effect? How much should the company cough up? The Competition Commission has given us a method. It has asked car companies to pay two per cent of their turnover for overcharging on spare parts, making for a total of Rs 2,545 crore. Perhaps Tata Steel could be asked to cough up two per cent of its turnover from 1912, or whenever it began production.

This is the law being an ass, as a Dickensian character said. If no one knows when some regulatory issue from the hoary past will rise from the mists of forgotten time and give them a bullet shot through the head, how are businesses to function? Reports say disinvestment decisions of 2002 are to be re-examined for criminality. So if it can be established that tax favours were done to help primarily one businessman in the Budget of 1987, say, will the state now ask the company to make good that money, with interest and penalty, from 1987? And what about all the officials and ministers who dished out these favours over the decades? Shouldn’t action be taken against all of them? Like the hapless P C Parakh, shouldn’t they be pulled out of retirement (or better still, their graves) and hauled to account?

Someone should look at this from the viewpoint of a company that applied in the normal course for a mining lease. How does it know whether due process was followed by the government? If no collusion or criminality can be laid at the company’s door, why should it pay any penalty for someone else not doing his paperwork properly? Right now, hundreds of mining leases are being renewed in many states, so that mines closed on court orders can re-open. Do we know that all of them are doing their paperwork properly? If not, will the leases be cancelled the day after tomorrow?

Like the idea of giving the Bharat Ratna to Subhas Chandra Bose, or even (someone might suggest) the Buddha or Chandragupta Maurya, there should be a law of limitations that imposes a time limit on how far back you can go to unearth past crimes, or redress past injustices. If not, we could claim countless billions (perhaps trillions, in inflation-adjusted money) from the Brits as reparations for colonial depredations. Time limits on undoing past injustices or for pursuing past crimes are not a novel idea, they exist in many fields of law, including tax law – except that a recent finance minister had the wisdom to extend the possibility of retrospective action from six years to 16. If you don’t remember the details of your tax filings of 1998, you could be in trouble, you know.


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