The cabinet secretary's decision will be the last word in all commercial disputes among government departments and Central public sector enterprises. It will be binding on all, and the departments and PSUs cannot knock on the doors of the courts.
The Union Cabinet on Wednesday made the decision in order to strengthen the mechanism for resolving such disputes based on the recommendations of the committee of secretaries. It is also intended to resolve countless disputes between government departments and PSUs without referring the matter to the courts.
“In many cases, even courts have expressed disgust at the number and nature of such cases. It will help bring down the cases pending in the courts,” said Ravi Shankar Prasad, the Union minister for law, adding that there would be defined timelines to enable quicker decision taking.
The first stage of the two-tier mechanism will see the disputes referred to a committee, comprising the secretaries of the ministries and departments of the disputing departments and CPSEs, and the secretary, Legal Affairs. The financial advisors of the disputing departments will represent them. The committee has been given three months to dispose of the disputes.
Should the dispute remain unresolved, it will be referred to the cabinet secretary.
“The new mechanism will promote equity through mutual and collective efforts to resolve commercial disputes. It will also avoid wastage of public money,” said Prasad.