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25th August Current Affairs

Supreme Court Bench to revisit 2013 verdict on poll promises

(GS-II: Structure, organization and functioning of the Executive and the Judiciary)

In News:

The Supreme Court said it will constitute a three-judge Bench to re-consider a 2013 judgment which held that pre-poll promises made by a political party cannot constitute a corrupt practice under the Representation of the People (RP) Act.

Background:

SC in (S. Subramaniam Balaji Vs Tamil Nadu (2013)) case announced that only an individual candidate, not his party, can commit a ‘corrupt practice’ under the RP Act by promising free gifts.

During a hearing on ways to rein in irrational freebies, The Balaji judgment came under the spotlight after nine years.

Chief Justice N. V. Ramana’s Bench was told that:

There cannot be a dichotomy between a political party and its candidate.

What the candidate promises is what his party wants him to promise. The party cannot escape liability.

Sec 123 of RP Act:

Section 123 of the RP Act deals with ‘corrupt practices’

The provision says it is ‘bribery’ and thus deemed a corrupt practice if any gift, offer or promise of gratification is made to voters directly or indirectly by a candidate or his agent.

Questions on The Balaji judgment:

The judgment had clearly drawn a distinction between an individual candidate put up by a political party and the political party itself.

Rationale of Balaji judgment:

The judgment had held that it was directly part of the Directive Principles of State Policy for a State to distribute “largesse in the form of distribution of colour TVs, laptops, etc., to eligible and deserving persons”.

In what way the State chooses to implement the Directive Principles of State Policy is a policy decision of the State and this court cannot interfere with such decisions unless it is unconstitutional.

Supreme Court’s current observation:

Supreme Court said for identifying the issue and to draw a distinction between welfare schemes and doles, its previous judgment required a relook.

The apex court had directed the Election Commission to consult with recognised political parties and frame guidelines for the general conduct of candidates, etc., and also for election manifesto.

The court said, that all of this could be included in the Model Code of Conduct for the Guidance of Political Parties and Candidates.

Chief Justice Ramana said, a three-judge Bench will be constituted for this.

The Competition (Amendment) Bill, 2022

(GS-II & III: Parliament-Structure, functioning and conduct of business, Competition Commission of India etc)

In News:

The changing market dynamics due to technological advancements, artificial intelligence, factors other than price, amendments became necessary to sustain and promote market competition. A review committee was established in 2019 which proposed several major amendments.

Background:

The Competition Commission primarily pursues three issues of anti-competitive practices in the market:

  • Anti-competitive agreements
  • Abuse of dominance
  • Combinations

What is the major change in dealing with new-age market combinations?

‘Deal value’ threshold: Amendment makes it mandatory to notify the Commission of any transaction with a deal value in excess of ₹2,000 crore and if either of the parties has ‘substantial business operations in India’.

Under Section 5 currently parties indulging in merger, acquisition, or amalgamation need to notify the Commission of the combination only on the basis of ‘asset’ or ‘turnover’.

Frame regulations to prescribe the requirements for assessing(an enterprise having ‘substantial business operations in India): This change will strengthen the Commission’s review mechanism, particularly in the digital and infrastructure space.

Information to commission: When business entities are willing to execute a combination, they must inform the Commission.

The Commission may approve or disapprove the combination, with a check on adverse effect on competition.

Increase in timeline: The new Bill seeks to accelerate the timeline from 210 working days to only 150 working days with a conservatory period of 30 days for extensions to approve the combination.

Anti-competitive agreements: The amendment broadens the scope of ‘anti-competitive agreements’ to catch entities that facilitate cartelisation even if they are not engaged in identical trade practices.

Framework for settlements and commitments: For cases relating to vertical agreements and abuse of dominance.

In the case of vertical agreements and abuse of dominance, the parties may apply for a ‘commitment’ before the Director General (DG) submits the report.

Settlement’ will be considered after the report is submitted and before the Commission decides.

Leniency Plus: It allows the commission to give an additional waiver of penalties to an applicant who discloses the existence of another cartel in an unrelated market.

Appointment of the DG: To be appointed by the Commission rather than the Central government, giving the Commission greater control.

Penalties and penalty guidelines: For any false information filed, a penalty of five crore will be imposed, and for failure to comply with the Commission directions, a penalty of ₹10 crore will be imposed.

NCLT: For an appeal to be heard by the National Company Law Tribunal (NCLT) against the Commission’s order, the party will have to deposit 25% of the penalty amount.

Challenges combining parties face in open market purchases:

Gun jumping cases: There have been several gun-jumping cases owing to the combining parties’ inability to defer the consummation of open market purchases.

Unaffordable transaction: If parties wait for the Commission’s clearance, the transaction may become unaffordable.

Exempt open market purchases: The amendment proposes to exempt open market purchases and stock market transactions instead of notifying to the Commission in advance(Similar to the European Union merger regulations).

This is subject to the condition that the acquirer does not exercise voting or ownership rights until the transaction is approved and the same is notified to the Commission subsequently.

Conclusion:

By implementing these amendments, the Commission should be better equipped to handle certain aspects of the new-age market and transform its functioning to be more robust.

Hub-and-Spoke arrangements:

A Hub-and-Spoke arrangement is a kind of cartelisation in which vertically related players act as a hub and place horizontal restrictions on suppliers or retailers (spokes).

Currently, the prohibition on anti-competitive agreements only covers entities with similar trades that engage in anti-competitive practices

What is gun-jumping?

If the combining parties close a notified transaction before the approval, or have consummated a reportable transaction without bringing it to the Commission’s knowledge, it is seen as gun-jumping.

The penalty for gun-jumping was a total of 1% of the asset or turnover. This is now proposed to be 1% of the deal value.

Competition Commission of India:

It is a statutory body of the Government of India, responsible for enforcing the Competition Act, 2002 throughout India.

It prevents activities that have an adverse effect on competition.

Setting target of 10 Mn apprenticeship in 10 years

(GS-III: Employment/ Government intervention in various sectors)

In News:

As per a study, doubling the number of apprentices from 5 lakh to 10 lakh per year, and setting an initial target of 10 million apprentices in ten years, is a crucial step in bridging the skill gap.

Details:

An apprenticeship is a paid job where the employee learns and gains valuable experiences. It may involve on-the-job along with part-time classroom study.

Current status:

India currently has only 5 lakh apprentices, which constitutes 0.11% of the pool of apprentices worldwide.

Unemployment rate in India was 3.3% (2020-21)- with the youth unemployment rate at 12.9%

Formal training in India remains low at less than 4% (In South Korea, more than 90% are formally trained)

Reasons for low apprenticeships:

Complex labour and regulatory requirements for firms who hire apprentices

In India, academic education (theoretical) is preferred over vocational training (practical)

Significant mismatch between what the world of work needs and what youth knows

Apprentices are seen as the source of cheap labour and enjoy inadequate protections.

Lack of information and matching of skillset for the employee as well as employer

Government sector lacks behind g., of 339 Central PSUs, only 150 engage apprentices.

Government efforts:

National Policy of Skill Development and Entrepreneurship, 2015 (strongly focuses on apprenticeship as a means to provide gainful employment)

Apprentice Protsahan Yojna (Government reimburses the cost of basic training of apprentices)

National Apprenticeship Training Scheme (NATS) (1-year apprenticeship programme, under the Ministry of Education)

National Employability through Apprenticeship Program (a PPP programme to hire 2 lakh apprentices every year for the next 10 years, under the Ministry of Skill Development)

It also releases Apprenticeship Outlook Report

National Apprenticeship Mela (support hiring of more than one lakh apprentices)

SHREYAS (scheme for higher education youth in apprenticeship and skill)

YuWaah Youth Skilling Initiative

Apprentices Act, 1961(regulates training of apprentices in the industry)

What should be done?

New employer-led training manual to impart need-based skills

Change in pedagogy and curriculum in universities

Better skilling governance

As per the study if each MSME engages only one apprentice, still India will have 25 lakh

Conclusion:

With these reforms, India will not only ramp up our apprenticeship adoption but will also be closer to what is already happening in Europe, China, and Japan – countries that have pioneered apprenticeships over the decade.