Ravi Shankar Prasad said this was just one of the several steps by the government to make India more appealing to international businesses, and quick dispute resolution is an important element of it.
Replacing an ordinance, a Bill to resolve commercial disputes worth Rs 3 lakh or more was passed by Lok Sabha on Wednesday, even as Opposition members raised concerns that it could choke an already overburdened judiciary.
Responding to the issues raised by Opposition leaders over the Commercial Division and Commercial Appellate Division of High Courts (Amendment) Bill, 2018, Law Minister Ravi Shankar Prasad said that the Bill will help elevate India’s position in the global ‘Ease of Doing Business’ rankings.
This, Prasad said, was also the reason why an ordinance had been brought in — to not miss the May deadline of World Bank, when it asks for data to collate the rankings. Prasad said this was just one of the several steps by the government to make India more appealing to international businesses, and quick dispute resolution is an important element of it. He said India’s ranking had improved by 42 places — from 142, when the Narendra Modi government took office in 2014, to 100 this year — in World Bank rankings.
He said: “Good governance is also an important component of an economy. Good governance is not only of ordinary civil disputes, criminal disputes, which must be given a focus, but also of commercial disputes.” He said an important aspect of the new Bill is a compulsory pre-litigation mediation between the disputing parties, with a time-frame of three months, unless an urgent intervention is required.
Objecting to the ordinance route taken by the government, N K Premachandran of the RSP asked what was the urgency to bring that ordinance. Since the ordinance was promulgated on May 3, “what are the instances which have happened after 31st May till the commencement of this session”, he asked.
Premachandran and Pinaki Misra of the Biju Janata Dal were among several Opposition MPs who said that the lowering of dispute value from Rs 1 crore to Rs 3 lakh will “choke” the courts. Misra said that the Law Commission and Parliamentary committees, among others, had recommended a dispute value of Rs 1 crore or higher, yet the government chose to reduce it to Rs 3 lakh. At such a low value, he said, “every single” dispute will find its way to the courts.
SP Muddahanume Gowda of the Congress asked if the government’s intention is to attract business, why does it want to “reduce pecuniary jurisdiction of the quantum from Rs 2 crore to Rs 3 lakh”, as it will “take away the seriousness” of the Bill.
AIMIM’s Asaduddin Owaisi said that going by the existing backlog of cases, and the present infrastructure, it will take 365 years to clear them. In a jibe at PM Modi, Owaisi said, “You may have…a leader with a 56-inch chest, who wants to trample on the separation of power” regarding a provision in the Bill that state high court chief justice’s approval may not be required to appoint judges in the lower judiciary.
In reply, Prasad dismissed all concerns and stated that the lower limit allows anyone, from a person who might own a thela to the biggest industrialist, to approach the court, thus democratising the process. Regarding judicial appointments, he said that apart from a record number of appointments, the government had also invested in infrastructure.