Union to form committee of Industry, BPE and Law to vet disputes between central ministries and PSUs before litigation

SC directed the Union to constitute a Committee with representatives of the Ministry of Industry, the Bureau of Public Enterprises and the Ministry of Law to monitor and vet disputes between Central Ministries and Central PSUs and among PSUs, requiring Committee clearance before any matter proceeds to court or tribunal. The Government may add the concerned Ministry's representative and one from the Ministry of Finance; only senior officers are to be nominated. The Committee will operate under the Cabinet Secretary's ultimate control (or his delegate), and quarterly reports on its functioning must be filed with the Registry beginning 1 January 1992.

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Issues involved: Settlement of dispute between Government Department and Public Sector Undertaking of the Union of India, implementation of measures to avoid unnecessary litigation and promote amicable resolution of disputes.

Settlement of Dispute:
The Cabinet Secretary reported to the Supreme Court that the dispute between the Government Department and the Public Sector Undertaking of the Union of India has been settled, following the Court's previous order. The Government has acknowledged the Court's views that public undertakings should avoid litigation and resolve disputes amicably through consultation, empowered agencies, or arbitration. The Cabinet Secretary emphasized the need to eliminate unnecessary spending on legal fees and public time wasted on litigation.

Establishment of Monitoring Committee:
The Supreme Court directed the Government of India to establish a Committee comprising representatives from the Ministry of Industry, the Bureau of Public Enterprises, and the Ministry of Law. This Committee is tasked with monitoring disputes between different Ministries, between Ministries and Public Sector Undertakings, and among Public Sector Undertakings. The Committee's role is to ensure that no litigation reaches the Court or Tribunal without prior examination and clearance by the Committee. Senior Officers are to be nominated to maintain the Committee's status, control, and discipline.

Clearance Requirement for Courts and Tribunals:
It is mandated that every court and Tribunal must demand clearance from the Committee for any dispute that is raised, and in the absence of such clearance, proceedings should not proceed. This measure aims to prevent unnecessary litigation and promote the resolution of disputes through the established Committee.

Reporting and Oversight:
The Committee will operate under the ultimate control of the Cabinet Secretary, with delegated authority for day-to-day matters. The Court expects quarterly reports on the functioning of this system to be submitted starting from January 1, 1992. Additionally, the directions issued by the Court are to be communicated to every High Court for dissemination to all subordinate courts, ensuring widespread awareness and compliance with the established procedures.

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