New Delhi: Armed with the Supreme Court observation, the Government on Friday said constitutional authorities like the Comptroller and Auditor General (CAG) should take note of the ruling that auction is not the only method for allocating natural resources.

"I sincerely hope that all constitutional authorities in future will bear in mind (the observations of Apex Court) while discharging their constitutional functions", Finance
Minister P Chidambaram said here, while explaining the importance of ruling along with Telecom Minister Kapil Sibal and Law Minister Salman Khurshid.

Chidambaram said this in response to a question whether the Supreme Court's opinion on Presidential reference vindicated the stand of the government on 2G and coal blocks allocation controversy. The CAG in its reports had observed that faulty allocation of spectrum and coal blocks had cost a big loss to the exchequer.

Giving its opinion on the Presidential reference arising out of 2G verdict, a five-judge constitution bench of the Apex Court on Thursday held that auction was not the only method for allocating natural resources to private companies.

The court observed that common good was the touchstone for any policy and any means adopted to achieve the objective was in accordance with the constitutional principles.

"The implied benchmark against which loss or presumptive loss was judged (by CAG) was auction...the Supreme Court says that auction is not a constitutional mandate for disposing of natural resources...I think in a way all of us are in a learning process", Chidambaram said.

As regards the irregularities in implementation of the policies, he said, "we have maintained... that if there were any irregularities or illegalities in implementation of any policy, those must be corrected and those responsible be held to account".

On spectrum, Chidambaram said the government has accepted the Supreme Court judgement on 2G which says 122 telecom licences will be cancelled and spectrum released from them will be auctioned.

When asked about revenue generation from the spectrum auction, he said "I think we should realise a substantial and significant amount".

To a query on status of contracts entered into since 1994, Chidambaram said broadly if government adopted an economic policy and entered into contracts based on that policy "those contracts will obviously stand unless somebody points out that there was either an abuse of power or an irregularity or illegality in entering of that contract".

Sibal, replying to a question on CAG, said that in the wake of the Apex Courts opinion, the government auditor cannot now relate losses to policy decisions.

On a query related with coal auction, the Finance Minister said as far as coal and lignite are concerned, the policy of the government "prescribes auction as the only mode".

On policy choice, he said the government is entitled to make the choice. "...(if) revenue maximisation is not the first objective or the dominant objective, some other objective has to be advanced. The government is entitled to make that choice and the court will not review that decision," he said.

Elaborating on the finer points of the Apex Court's observations, Sibal said, "auction of natural resources is not a constitutional mandate but an economic choice".

Future decisions of the government, Khurshid said, "will be taken in the light of Supreme Court judgement."


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