SMALL SCALE INDUSTRIAL MANUFACTURES ASSOCIATION (REGD.) versus UNION OF INDIA AND OTHERS

Citation: [2021] 15 S.C.R. 1 · Decided: 23-03-2021 · Supreme Court of India · Bench: ASHOK BHUSHAN · Disposal: Case Partly allowed

Cited by 2 judgment(s) · cites 17 · see the full citation network in Lexace

Judgment (excerpt)

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[2021] 15 S.C.R. 1
1
 SMALL SCALE INDUSTRIAL MANUFACTURES
ASSOCIATION (REGD.)
v.
UNION OF INDIA AND OTHERS
(Writ Petition (C) No. 476 of 2020)
MARCH 23, 2021
[ASHOK BHUSHAN, R. SUBHASH REDDY AND
M.R. SHAH, JJ.]
Judicial review – Economic policy matters – Covid-19
pandemic – Financial strain faced by industrial sector – Policy
decisions by RBI and/or Government w.r.t relief/regulatory packages
– Judicial review of – Limited scope – Held: Economic and fiscal
regulatory measures are a field where Judges should encroach upon
very warily as Judges are not experts in these matters – Wisdom
and advisability of economic policy are ordinarily not amenable to
judicial review – Function of the court is not to advise in matters
relating to financial and economic policies for which bodies like
RBI are fully competent – Court can only strike down some or entire
directions issued by the RBI in case it is satisfied that the directions
were wholly unreasonable or in violative of any provisions of the
Constitution/any statute – Matters of economic policy ought to be
left to the government – No writ of mandamus can be issued directing
the Government/RBI to announce/declare particular relief packages/
policy or to grant some more reliefs/packages – Merely because
some class/sector may not be agreeable/satisfied with such packages/
policy decisions, the courts should not ordinarily interfere with the
policy decisions, unless it could be faulted on the ground of mala
fide, arbitrariness, unfairness etc. – Present petitions seeking reliefs
w.r.t total waiver of interest during the moratorium period; sector-
-wise relief packages; extension of moratorium period beyond
31.08.20 or extension of the last date for invocation of the resolution
mechanism provided in the 6.8.2020 circular, are all in the realm of
the policy decisions – If such reliefs are granted, it would seriously
affect the banking sectors and have far reaching financial
implications on the economy of the country – However, there shall
be no charge of interest on interest/compound interest/penal interest
for the period during the moratorium and any amount already
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SUPREME COURT REPORTS
[2021] 15 S.C.R.
recovered under thereunder be refunded to the concerned borrowers
and be given credit/adjusted in the next instalment of the loan account
– Constitution of India – Articles 14, 32, 226, 227 – Disaster
Management Act, 2005.
Disaster Management Act, 2005 – ss.3,6-14, 23, 35-37 –
Natural disasters; Pandemic – Plea that there is no National Plan
at all therefore, the National Disaster Management Authority failed
to perform its duty – Held: Cannot be accepted – There is already a
National Disaster Management Plan prepared even prior to the
Covid-19 pandemic – Under the National Plan, there is a National
Disaster Management Institutional Mechanism – The said plan also
envisages nodal ministries for management of different disasters –
Disaster due to Covid-19 pandemic would fall under disaster due
to “biological emergencies” – Considering the very nature of the
pandemic which would have PAN--India impact, empowered groups
were constituted by the NDMA – Therefore, when there is already in
existence a National Plan, which might have been prepared even
prior to the Covid-19 pandemic, it cannot be said that there is no
National Plan by the NDMA at all – For every disaster, there shall
not be a new National Plan.
Words & Phrases – “may” – Disaster Management Act, 2005
– s.13 –Held: Word used in s.13 is “may” and not “shall” – While
interpreting a particular provision, the language used is to be read
as it is – The legislature has deliberately used the word “may” -–
“may” is used after considering the object and purpose of the Act
as a whole and the role to be played by the Central Government
through different ministries, by the State Government, by the District
Authority at the district level – In the present case, the Ministry of
Finance and the RBI have already come out with different packages/
reliefs in repayment of loans or grant of fresh loans to the persons
affected by disaster – Interpretation of Statutes.
Partly allowing the writ petitions, the Court
HELD: 1.1 In catena of decisions and time and again this
Court has considered the limited scope of judicial review in
economic policy matters. From various decisions of this Court,
this Court has consistently observed and held-The Court will
not debate academic matters or concern itself with intricacie

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