The order comes as the southern state struggles to pay salaries of government employees and pension to the retired employees.
Representational Image [Photo : iStock]
In a major relief to cash-starved Kerala, the Supreme Court on Wednesday directed the central government to allow the state to borrow Rs 13,608 crore on an immediate basis.
The order comes as the southern state struggles to pay salaries of government employees and pension to the retired employees.
The top court also directed both the parties to conduct a secretary-level meeting to sort out the issues pertaining to borrowings.
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Though the amount is within Kerala’s eligible borrowing limit for this fiscal, the Centre had taken the stand that it could be allowed only if the state withdraws its original suit seeking interim relief from the Centre. The apex court criticized the Centre for asking the state government to withdraw the petition.
“Filing a suit is a right (to the petitioner) within Article 131 of the Constitution,” the court said. It further said the Union of India can place other conditions except the condition to withdraw the suit.
The Kerala government, in its petition, had alleged that the Union government was unnecessarily interfering in the state’s finances, and submitted to the apex court that due to such interference, the state was unable to fulfill the commitments in its annual budget.
Responding to the verdict, Kerala Finance Minister K N Balagopal said the apex court had upheld the inalienable and democratic right of individuals and entities, including states, to approach the court for relief.
T M Thomas Isaac, the ruling CPI(M) candidate from Pathanamthitta Lok Sabha constituency in Kerala, said the order has dealt a “body blow to the Congress-BJP combine’s false propaganda”.
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