Sort out differences on financial issues, SC tells Kerala and Centre

Sort out differences on financial issues, SC tells Kerala and Centre

Subject: Polity

Section: Federalism

Context:

• The Supreme Court Wednesday asked the Centre and Kerala government, which have been sparring over the state’s borrowing limit, to hold further discussions to sort out their differences.

More on news:

• A two-judge bench presided by Justice Surya Kant stated that the fiscal management of the states is an issue with which the Union must be concerned because ultimately it has its own impact on the nation’s economy.
• Justice Surya Kant said the Centre is free to impose every other condition that it may feel appropriate to give sanction to borrow an additional Rs 13,608 crore “except the condition to withdraw the suit …”.

Article in news:

• Article 293 of the Constitution: The executive power of a State extends to borrowing within the territory of India upon the security of the Consolidated Fund of the State.
• Article 293(3) of the Constitution: State cannot raise a loan without the consent of the Government of India if any part of a previous loan from the central government remains outstanding.
• Article 131 of the Constitution:The Supreme Court has exclusive and original jurisdiction in matters of law between states or between states and the Union.