Openness In Judicial And Corporate Governance

This article is the second installment in a 3-part series about Ethics in Public Governance by Sudhansu Mohanty.

[ continued from Part-I]

Developments in the last few days though have been very disturbing. Justice Jayant Patel, the senior-most puisne judge of the Karnataka High Court, who ordered CBI probe in the Ishrat Jahan case, has put in his papers in the wake of his transfer to the Allahabad High Court, ostensibly for overlooking him for appointment as Chief Justice of a High Court despite his seniority. Justice Jayant Patel has done the most honorable thing by putting in his papers. A High Court judge for close to 16 years – appointed in December 2001 – the treatment meted out to him is unfortunate. After having acted as the officiating Chief Justice of the Gujarat High Court for 7 months from August 2015 to February 2016, it would have been appropriate to appoint him as a Chief Justice of a High Court. Instead, first he was transferred to the Karnataka High Court in February 2016; and now after being a judge for 17 months in Karnataka High Court and just 10 months away from retirement, he was transferred to the Allahabad High Court. His is quite similar to 1973 and 1977 cases of supersession of Supreme Court judges in the wake of judgments in Keshavananda Bharati (1973) and ADM Jabalpur (1976) cases respectively – the only difference being that the Ishrat Jahan case is not as recent as the earlier two cases vis-à-vis the supersession dates. But memory is long and it pays not to forget! This shall doubtless go down as yet another sad day for the Indian judiciary.

But the appointment procedures were different in the 1970s, when it was entirely in the hands of the executive. Things changed with the introduction of the collegium system. The apex court asserted its primacy in the NJAC case. But to what effect? This one unquestionably is a complete failure of the Supreme Court collegium; it has failed to assert its independence by completely surrendering to the rampaging executive! Can one read any meaning to this? He had directed CBI investigation in the Ishrat Jahan case, and had also monitored it for 6 months and is there anything one can infer? This is more a failure of the higher judiciary (compared to earlier occasions in the 1970s) than as a triumph of the executive. The judiciary buckled, thereby ensuring executive’s supremacy! Rather ominous for the nation and the rule of law.

It is just as well that Dushyant Dave, the respected Senior Advocate in the Supreme Court has come out strongly against the failure of the collegium in the following words:

“Justice Patel’s resignation is a reflection on the vindictiveness of PM Modi and BJP President Amit Shah. It is a sad reflection on the so-called independence of the Collegium which failed him and the judiciary by compromising with the Executive and agreeing to bypass him with juniors being elevated. The conduct of Collegium shows that their words in NJAC judgment are totally hollow.

Justice Patel has come out like a shining star while those who participated in his ouster have come out as small men. I salute Patel J. and extend my warmest wishes for happiness that he deserves which he can only find according to him, outside judiciary. Hope this raises a real debate on functioning of collegium and the injustices perpetrated by it.”

More than 200 lawyers of the Karnataka High Court have signed an open letter to the Chief Justice of India against the transfer and supersession of Justice Patel. They have also decided to strike work on October 4, 2017. Even the Gujarat High Court Advocates Association has passed a resolution to file a petition in Supreme Court challenging the transfer of Justice Patel from the Karnataka High Court to the Allahabad High Court. But what’s going to come off it? Your guess is as good as mine.

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Related: Propriety Is Key To Citizen’s Quality Of Life by Sudhansu Mohanty

In the US, the President nominates and the Senate recommends after elaborate scrutiny by the Senate Judiciary Committee composed of lawmakers from both parties. It’ll be worth emulating the US practice with appropriate changes, which will likely inject transparency in higher judicial appointment. The same method could as well be followed for other constitutional and statutory offices, like CIC/ICs, C&AG, CEC/ECs etc.

Move over to another aspect: Live Streaming of Court proceedings. Strange as it may sound, it is the US Supreme Court Justices who have opposed cameras in the courtrooms. Eminent Indian lawyers though view that video recording of the Supreme Court proceedings will help the common man to view justice delivered live, giving full expression to their fundamental right as guaranteed under Article 19(1)(a). Justice delivered in real-time from the judges’ mouth and not from Twitter! We are a mature democracy. Regardless of whichever part of the “globalville” we live in today, live-streaming will educate an information-hungry nation on issues that affect them intimately. It would mean doorstep delivery of justice, apart from being user-friendly, as we witness history being made in front of our eyes. It would also promote transparency and accountability in the administration of justice and inspire confidence in the judiciary. The cliché of “justice must not only be done but also seen to be done” will ring truer.

Several eminent lawyers opine that “other than criminal cases and family law where the privacy of an accused is compromised or a family dispute is required to be protected by privacy”, all other cases of constitutional importance could be live-streamed. Imagine viewing live the hearings in the Triple Talaq and the Right to Privacy cases. All the more reason since the Lok Sabha and the Rajya Sabha proceedings are streamed live. Recall the much-loved, much-WhatsApped Caught in Providence Chief Judge Frank Caprio, in An Honest Boy: I love this Judge. Imagine the good that tiny clip can do to society. Much like tele-medicine benefiting patients in far-off places, live-streaming of court proceedings will, too.

Look around the corporate world and take one recent issue pertaining to reduction of price of stent in private hospitals. In February 2017, the National Pharmaceutical Pricing Authority (NPPA) had capped the price of bare metal stents at Rs 7,260 per piece, and of drug-eluting and biodegradable stents at Rs 29,600 each. It was slightly increased to Rs 7,400 and Rs 30,180 respectively in March, after adjusting with the latest wholesale price index (WPI). Seven months after the government capped the price of coronary stents, leading to a cut in their price by about Rs 1 lakh, the hospitals are yet to reduce the package cost of an angioplasty – a procedure in which a stent is used to open a narrowed or blocked artery to improve blood flow. Insurance companies say that the expenditure for the procedure hasn’t seen a corresponding drop. Though the overall cost of an angioplasty is said to be cut by Rs 30,000-40,000, in reality the cutback in stent costs has been offset by an increase in the cost of other components for the procedure. How ethical is that? Doubtless, the hospitals need to be more transparent. Hospitals should make a profit, not a king’s ransom. Fair pricing, transparency is the need of the day.

Another correlated issue sucks: Niti Aayog’s recent Three Year Action Agenda, 2017-18 to 2019-20 on Access to Medicines. To say the least, it is disturbing. “A balanced approach towards regulation is needed for achieving the twin objectives of access to effective medicines and a strong pharmaceutical industry,” so says the Agenda document. “There is a trade-off between lower prices on the one hand and quality medicine and discovery of breakthrough drugs on the other. It is therefore recommended that the Drug Price Control Order may be delinked from the National List of Essential Medicines.”

The Prime Minister and the Health Minister speak in one voice to reduce cost of medicines and plugging for generic drugs as the Niti Aayog speaks in another nuanced voice! Essential medicines, says the WHO are “those drugs that satisfy the healthcare needs of the majority of the population; they should therefore be available at all times in adequate amounts and in appropriate dosage forms, at a price the community can afford”. While the National List of Essential Medicines (NLEM) is a list of essential medicines in India prepared by the Ministry of Health & Family Welfare, the Drug Price Control Orders (DPCO) are issued by the Government under section 3 of the Essential Commodities Act, 1955, to enable the Government to put a ceiling price for such essential life saving medicines and ensure that these medicines are available at a reasonable price to the general public.

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Related: Not Republic Of Fifth Column But Culture Of Transparency by Sudhansu Mohanty

That said, it might sound paradoxical to say that while generic drugs should be the order of the day, in today’s India few generic drugs pass the quality test. The 1980s and 1990s was a time of the generic drug “robber barons” thanks to poor laws and populist aspirations of the then governments bent on low drug prices sans quality of drugs. Little wonder India, though placed 4th in global generic drug market, has earned the ignominy of manufacturing 75 percent of world’s counterfeit generic drugs, soaring high above Egypt with 7 percent and China with 6 percent.

To be fair, the government indeed has, in April 2017, made changes to the Drug and Cosmetics Act of 1940, making it mandatory for genetic drug manufacturers to submit Bioequivalence (BE)/Bioavailability (BA) study reports for approval as against the earlier practice of merely submitting the BE/BA reports for genetics of patented drugs in the first 4 years of introduction. Nothing more is asked of them, thus making it a field day for genetic drugs to flood the market. Once in an indigo moon the finished drug was submitted for testing at the Central Drugs Standard Control Organization (CDSCO). Little wonder barely that 0.01% of the genetic drugs in the Indian market are tested for its potency and efficacy. So the amendment to the Drugs and Cosmetics Act (1940) is a welcome development. But the issue now is one of regulation and implementation. Anyone who has worked in the government knows its innards. The system is so apathetic and opaque that a complaint of poor/inadequate potency will keep meandering about in the corridors of government Bhavans; the callousness of our Brother Babus is phenomenal!

There can be no two views that the need is to increase the number of test labs all over the country in government medical colleges, increase the number of pharmacists/pharmacologists, put a strict testing process in place, and go transparent with test results by uploading them in public domain. Any complaint from a consumer must be attended to with a sense of immediacy and the same too put out on the website. But will the government bite such “dangerous” transparency that will jeopardise big pharma companies’ interest? I doubt if this will happen. To expect the government to seed a billion Lokpals to oversee is a pipedream! We are then back to square one despite the recent amendment to the Drug and Cosmetics Act.

Large pharmaceutical companies invest huge money in developing a new drug; the amount could be more than US$ 2-3 billion. Naturally they will like to get return on investment – through patent and royalty. India too seeks big bang R&D in drugs, and Indian firms are interested. Perhaps that explains why the government is speaking with a forked tongue: while the PM and his Ministers speak about mandating generics, the Niti Aayog suggests “a trade-off”!

The Niti Aayog’s recent proposal to introduce the Private-Public Partnership model in select district hospitals only fortifies this suspicion. Some commentators view it “as ill-designed, driven by ideology more than welfare and a strange hybrid that has no precedent anywhere in the world, calling it strategic, bizarre or hare-brained”. The Aayog justifies space to private hospitals in “select district hospitals to private players through a transparent, competitive PPP framework for the treatment of non-communicable diseases (NCDs) by harping on failings of our publicly provided health services”, pointing at Gorakhpur tragedy. Rampant absenteeism of doctors – varying from 28 percent to 68 percent across different states – the Aayog cites copiously to show that government doctors contribute less effort vis-à-vis their private counterparts and they prefer to pontificate: Long-term measures to restructure the MCI are on anvil (Pray, who will? Remember Ketan Desai!); and observe that District hospitals will provide basic services for diagnosis and treatment of NCDs “at affordable rates or free of cost for those patients for whom the government chooses to cover” through insurance or budgetary grants. The public exchequer will pick up the insurance and reimbursement tab. How generous!

[continued in Part-III →]


The writer, Sudhansu Mohanty, is an acclaimed author and previously served as a Financial Adviser to the Ministry of Defence and Ministry of Environment, Forests & Climate Change.

This article is the second installment in a 3-part series about Ethics in Public Governance.

Tweet at Sudhansu: @MohantyMohanti


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