Supreme Court asks Centre to give one time package to Kerala to bail out State from financial crisis

The Supreme Court on Monday suggested that Central government to provide a one time package to Kerala to bail out the State from its current financial crisis [State of Kerala vs Union of India]..A bench of Justices Surya Kant and KV Viswanathan said that the package can be given subject to strict conditions."You can be slightly liberal and give a one-time package as a special case. And more rigid conditions in future budgets ... Before March 31 give them the special package. But subject to harsher conditions than other States. For the existing States you will be liberal next time (perhaps)," Justice Kant remarked to counsel for the Central government.The Court conceded that it is not an expert in financial matters but the governments can work out a middle path for now.The matter will be taken up again tomorrow, with the Central and State government officials likely to hold a meeting before then.Senior Advocate Kapil Sibal appeared for the State of Kerala. Attorney General R Venkataramani and Additional Solicitor General N Venkataraman appeared for the Central government..The top court was hearing a plea filed by the Kerala government which claimed that the Central government was unduly interfering with the State’s power to borrow and regulate its finances.In its suit filed in December last year, the Kerala government alleged that the Centre's decision to impose certain limits on the State's borrowings had led to an accumulation of unpaid dues and could result in a grave financial crisis.Subsequently, the State had failed to pay salaries to many of its employees for the month of February. The Kerala and Central governments had in the previous hearing agreed to hold talks to iron out issues concerning finance and budgeting after the Supreme Court urged both the governments to talk and resolve the issues. A meeting was also held between the officials of the Centre and State after that..During the hearing today, Sibal sought an immediate release of ₹19,000 crore that the Centre owes Kerala. "The moment the Power Ministry says they have complied, it will be transferred. Bailout package is not possible under this scheme," the ASG then stated.The Centre said that it cannot give any special treatment to Kerala "Theirs is not a special case ... We have declined to other States. They do not even budget expenditures. 15 times more bailout sought than expenditure package," the ASG stressed.He added that the Union government's hands are tied in the matter."Let them tell the court why they cannot pay ... But to find a way out despite constraints, we are not at loggerheads", the AG then submitted. The bench asked the parties should work out an interim solution and proceeded to suggest that a special concession be given to Kerala by the Central government for now.