Banking Article, Banking Finance 2020, Banking Finance May 2020

EMERGENCY:-A BITTER ALTERNATIVE TO 21 DAYS LOCKDOWN

India has taken the extreme measure of enforcing a 21-day lockdown, amidst corona outbreak, making it the first time a nation was shut under the provisions of the Disaster Management Act, 2005. Section 6(2)(i) of the Act authorizes the NDMA(National Disaster Management Authority), headed by the prime minister, to take measures for “the prevention of disaster, or the mitigation, or preparedness and capacity building for dealing with the threatening disaster situation or disaster as it may consider necessary”. The Act also provisions for a national executive authority, which exercises powers to issue guidelines that, will be in effect during lockdown.

The other alternative could have been imposing emergency, which could have given a unitary structure to country, allowing the country to override state directives.

A state of emergency in India refers to a period of governance under an altered constitutional setup that can be proclaimed by the President of India, when they perceives grave threats to the nation from internal and external sources or from financial situations of crisis. Under the advice of the cabinet of ministers and using the Constitution of India, the President can overrule many provisions of the constitution, which guarantee fundamental rights to the citizens of India and acts governing devolution of powers to the states which form the federation. In the history of independent India, a state of emergency has been declared thrice.

The first instance was between 26 October 1962 to 10 January 1968 during the India-China war, when “the security of India”   was declared as being “threatened by external aggression”. The second instance was between 3 December 1971 to 21 March 1977, which was originally proclaimed during the Indo-Pakistan war.

It was later extended along with the third proclamation between 25 June 1975 to 21 March 1977 under controversial circumstances of political instability, when emergency was declared on the basis of “internal disturbance”, but this term was too vague and had a wider connotation and hence 44th amendment act 1978 substituted the words “internal disturbance” for “armed rebellion” “. The phrase Emergency period used loosely, when referring to the political history of India, often refers to the third and the most controversial of the three occasions.

The President can declare three types of emergencies —

  1. National Emergency (Article 352)
  2. State Emergency(Article 356)
  3. Financial Emergency (Article 360)

WHAT IS ARTICLE 352?

  • If the President is satisfied that a grave emergency exists whereby the security of India (exceptions applicable) or of any part of the territory thereof is threatened, whether by war or external aggression or armed rebellion, he may, by Proclamation, make a declaration to that effect in respect of the whole of India or of such part of the territory thereof as may be specified in the Proclamation which can be explained as – A Proclamation of Emergency declaring that the security of India or any part of the territory thereof is threatened by war or by external aggression or by armed rebellion may be made before the actual occurrence of war or of any such aggression or rebellion, if the President is satisfied that there is imminent danger thereof.
  • A Proclamation issued under clause (1) may be varied or revoked by a subsequent Proclamation.
  • The President shall not issue a Proclamation under clause (1) or a Proclamation varying such Proclamation unless the decision of the Union Cabinet (that is to say, the Council consisting of the Prime Minister and other Ministers of Cabinet rank appointed under article 75) that such a Proclamation may be issued has been communicated to him in writing.
  • Every Proclamation issued under this article shall be laid before each House of Parliament and shall, except where it is a Proclamation revoking a previous Proclamation, cease to operate at the expiration of one month unless before the expiration of that period it has been approved by resolutions of both Houses of Parliament: Provided that if any such Proclamation (not being a Proclamation revoking a previous Proclamation) is issued at a time when the House of the People has been dissolved, or the dissolution of the House of the People takes place during the period of one month referred to in this clause, and if a resolution approving the Proclamation has been passed by the Council of States, but no resolution with respect to such Proclamation has been passed by the House of the People before the expiration of that period, the Proclamation shall cease to operate at the expiration of thirty days from the date on which the House of the People first sits after its reconstitution, unless before the expiration of the said period of thirty days a resolution approving the Proclamation has been also passed by the House of the People.
  • A Proclamation so approved shall, unless revoked ,cease to operate on the expiration of a period of six month from the date of the passing of the second of the resolutions approving the Proclamation under clause Provided that if and so often as a resolution approving the continuance in force of such a Proclamation is passed by both Houses of Parliament the Proclamation shall, unless revoked, continue in force for a further period of six months from the date on which it would otherwise have ceased to operate under this clause: Provided further that if the dissolution of the House of the People takes place during any such period of six months and a resolution approving the continuance in force of such Proclamation has been passed by the Council of States but no resolution with respect to the continuance in force of such Proclamation has been passed by the House of the People during the said period, the Proclamation shall cease to operate at the expiration of thirty days from the date on which the House of the People first sits after its reconstitution unless before the expiration of the said period of thirty days, a resolution approving the continuance in force of the Proclamation has been also passed by the House of the People.
  • For the purposes of clauses (4) and (5), a resolution may be passed by either House of Parliament only by a majority of the total membership of that House and by a majority of not less than two-thirds of the Members of that House present and voting.
  • Notwithstanding anything contained in the foregoing clauses, the President shall revoke a Proclamation issued under clause (1) or a Proclamation varying such Proclamation if the House of the People passes a resolution disapproving, or, as the case may be, disapproving the continuance in force of, such Proclamation.
  • Where a notice in writing signed by not less than one-tenth of the total number of members of the House of the People has been given, of their intention to move a resolution for disapproving, or, as the case may be, for disapproving the continuance in force of, a Proclamation issued under clause (1) or a Proclamation varying such Proclamation,—

           (a) to the Speaker, if the House is in session; or

           (b) to the President, if the House is not in session,a special sitting of the House shall be

                 held within 14 days from the date on which such notice is received by the Speaker, or,

                 as the case may be, by the President, for the purpose of considering such resolution.

  • The power conferred on the president by this article shall issue power to issue different proclamation on different grounds, being war or external aggression or armed rebellion or immitent danger of war or external aggression or armed rebellion,whether or not there is a proclamation already issued by president under clause(1),and such proclamation is in operation.

NATIONAL EMERGENCY UNDER ARTICLE 352

During a national emergency, many Fundamental Rights of Indian citizens can be suspended. The six freedoms under Right to Freedom are automatically suspended. By contrast, the Right to Life and Personal Liberty cannot be suspended according to the original Constitution.

In January 1977, during the emergency declared controversially by Indira Gandhi, the government decided to suspend even the Right to Life and Personal Liberty by dispensing with Habeas corpus. Justice Hans Raj Khanna defended the Right to Life and asked: “Life is also mentioned in Article 21 and would Government argument extend to it also?”. The Attorney General observed: “Even if life was taken away illegally, courts are helpless”.

A national emergency modifies the federal system of government to a unitary one by granting Parliament the power to make laws on the 66 subjects of the State List (which contains subjects on which the state governments can make laws). Also, all state money bills are referred to the Parliament for its approval. During an emergency, the term of the Lok Sabha can be successively extended by intervals of up to one year, but not beyond six months after the state of emergency has been revoked.

Few more facts-

  1. Article 352(2): A proclamation issued Article 352(1) can be revoked by a subsequent proclamation.
  2. 44th Amendment introduced A. 352(3) wherein it contained that the President shall declare no proclamation unless the same has been communicated to him in writing by the Union Cabinet.
  3. 352(4): Every proclamation before being passed in presented before each house of Parliament, namely the Lok Sabha and Rajya Sabha and needs the assent of both the houses. If within the period of 1 month the proclamation is not assented to, then it ceases to operate. The time period was decreased as an effect of the 44th amendment

Effects of national emergency

The declaration of National Emergency effects both on the rights of individuals and the autonomy of the states in the following manner:

1. The most significant effect is that the federal form of the Constitution changes into unitary. The authority of the Centre increases and the Parliament assumes the power to make laws for the entire country or any part thereof, even in respect of subjects mentioned in the State List.

2. The President of India can issue directions to the states as to the manner in which the executive power of the states is to be exercised.

3. During the emergency period, the Lok Sabha can extend tenure by a period of 1 year at a time. But the same cannot be extended beyond 6 months after the proclamation ceases to operate. The tenure of State Assemblies can also be extended in the same manner.

4. During emergency, the President is empowered to modify the provisions regarding distribution of revenues between the Union and the States.

5. The Fundamental Rights under Article 19 are automatically suspended and this suspension continues till the end of the emergency.

But according to the 44th Amendment, Freedoms listed in Article 19 can be suspended only in case of proclamation on the ground of war or external aggression. From the above discussion, it becomes quite clear that emergency not only suspends the autonomy of the States but also converts the federal structure of India into a unitary one. Still it is considered necessary as it equips the Union Government with vast powers to cope up with the abnormal situations.

WHAT IS ARTICLE 356 (President Rule)?

  • If the President, on receipt of a report from the Governor of a State or otherwise, is satisfied that a situation has arisen in which the Government of the State cannot be carried on in accordance with the provisions of this Constitution, the President may by Proclamation—
  • assume to himself all or any of the functions of the Government of the State and all or any of the powers vested in or exercisable by the Governor or any body or authority in the State other than the Legislature of the State;
  • declare that the powers of the Legislature of the State shall be exercisable by or under the authority of Parliament;
  • make such incidental and consequential provisions as appear to the President to be necessary or desirable for giving effect to the objects of the Proclamation, including provisions for suspending in whole or in part the operation of any provisions of this Constitution relating to any body or authority in the State: Provided that nothing in this clause shall authorize the President to assume to himself any of the powers vested in or exercisable by a High Court, or to suspending whole or in part the operation of any provision of this Constitution relating to High Courts.Duty of the Union to protect States against external aggression and internal disturbance.Provisions in case of failure of constitutional machinery in States.

 (2) Any such Proclamation may be revoked or varied by a subsequent Proclamation.

(3) Every Proclamation under this article shall be laid before each House of Parliament and shall, except where it is a Proclamation revoking a previous Proclamation, cease to operate at the expiration of two months unless before the expiration of that period it has been approved by resolutions of both Houses of Parliament: Provided that if any such Proclamation (not being a

Proclamation revoking a previous Proclamation) is issued at a time when the House of the People is dissolved or the dissolution of the House of the People takes place during the period of two months referred to in this clause, and if a resolution approving the Proclamation has been

passed by the Council of States, but no resolution with respect to such Proclamation has been passed by the House of the People before the expiration of that period, the Proclamation shall cease to operate at the expiration of thirty days from the date on which the House of the

People first sit after its reconstitution unless before the expiration of the said period of thirty days a resolution approving the Proclamation has been also passed by the House of the People.

(4) A Proclamation so approved shall, unless revoked, cease to operate on the expiration of a period of six months from the date of issue of the Proclamation; Provided that if and so often as a resolution approving the continuance in force of such a Proclamation is passed by both Houses of Parliament, the Proclamation shall, unless revoked, continue in force for a further period of six months from the date on which under this clause it would otherwise have ceased to operate, but no such Proclamation shall in any case remain in force for more than three years: Provided further that if the dissolution of the House of the People takes place during any such period of six months and a resolution approving the continuance in force of such Proclamation has been passed by the Council of States, but no resolution with respect to the continuance in force of such Proclamation has been passed by the House of the People during the said period, the Proclamation shall cease to operate at the expiration of thirty days from the date on which the House of the People first sits after its reconstitution unless before the expiration of the said period of thirty days a resolution approving the continuance in force of the Proclamation has been also passed by the House of the People: Provided also that in the case of the Proclamation issued under clause (1) on the 11th day of May, 1987 with respect to the State of Punjab, the reference in the first provision to this clause to “three years” shall be construed

as a reference to five years.

(5) Notwithstanding anything contained in clause (4), a resolution with respect to the continuance in force of a Proclamation approved under clause (3) for any period beyond the expiration of one year from the date of issue of such Proclamation shall not be passed by either

House of Parliament unless—

(a) a Proclamation of Emergency is in operation, in the whole of India or, as the case may be, in the whole or any part of the State, at the time of the passing of such resolution, &

 (b) the Election Commission certifies that the continuance in force of the Proclamation approved

under clause (3) during the period specified in such resolution is necessary on account of difficulties in holding general elections to the Legislative Assembly of the State concerned

Provided that nothing in this clause shall apply to the Proclamation issued under clause (1) on the 11th day of May, 1987 with respect to the State of Punjab.

A state of emergency can be declared in any state of India under article 356 on the recommendation of the governor of the state. Every state in India except two states, Chhattisgarh and Telangana has been under a state of emergency at some point of time or the other. The state of emergency is commonly known as ‘President’s Rule’.

If the President is satisfied, based on the report of the Governor of the concerned state or from other sources, that the governance in a state cannot be carried out according to the provisions in the Constitution, he/she may declare an emergency in the state. Such an emergency must be approved by the Parliament within a period of two months.

It is imposed for an initial period of six months and can last for a maximum period of three years with repeated parliamentary approval every six months.The 42nd amendment act of 1976 extended the initial time duration of state emergency from 6 months to 1 year. Subsequently, 44th CAA 1978 restored the 1-year period back to 6 months. Originally, the maximum period of operation of state emergency was 3 years. This 3-year period was divided into 1 year of ordinary period and 2 years of extra ordinary period for which certain conditions are to be fulfilled. Therefore, from now on after every 1 year Parliament needs to approve the same. If the emergency has to be extended for more than three years, it can only be done by a constitutional amendment, as has happened in Punjab and Jammu and Kashmir.

During such an emergency, the President can take over the entire work of the executive, and the Governor administers the state in the name of the President. The Legislative Assembly can be dissolved or may remain in suspended animation. The Parliament makes laws on the 66 subjects of the state list . All money bills have to be referred to the Parliament for approval. In this occasion ministers of state legislature do not perform actions in state.

Effect of State Emergency
The declaration of emergency due to the breakdown of Constitutional machinery in a State has the following effects:
1. The President can assume to himself all or any of the functions of the State Government or he may vest all or any of those functions with the Governor or any other executive authority.
2. The President may dissolve the State Legislative Assembly or put it under suspension. He may authorise the Parliament to make laws on behalf of the State Legislature.
3. The President can make any other incidental or consequential provision necessary to give effect to the object of proclamation.

WHAT IS ARTICLE 360?

  • If the President is satisfied that a situation has arisen whereby the financial stability or credit of India or of any part of the territory thereof is threatened, he may by a Proclamation make a declaration to that effect.

(2) A Proclamation issued under clause (1)—

(a) May be revoked or varied by a subsequent Proclamation; Provisions as to financial   emergency.

(b) shall be laid before each House of Parliament

(c) shall cease to operate at the expiration of two months, unless before the expiration of  that   period it has been approved by resolutions of both Houses of Parliament, Provided that if any such Proclamation is issued at a time when the House of the People has been dissolved or the dissolution of the House of the People takes place during the period of two months referred to in sub clause (c), and if a resolution approving the Proclamation has been passed by the Council of States, but no resolution with respect to such Proclamation has been passed by the House of the People before the expiration of that period, the Proclamation shall cease to operate at the expiration of thirty days from the date on which the House of the People first sits after its reconstitution unless before the expiration of the said period of thirty days a resolution approving the Proclamation has been also passed by the House of the People.

(3) During the period any such Proclamation as is mentioned in clause (1) is in operation, the executive authority of the Union shall extend to the giving of directions to any State to observe such canons of financial propriety as may be specified in the directions, and to the giving of such other directions as the President may deem necessary and adequate for the purpose.

(4) Notwithstanding anything in this Constitution—

(a) any such direction may include—

(i) a provision requiring the reduction of salaries and allowances of all or any class of persons serving in connection with the affairs of a State;

(ii) a provision requiring all Money Bills or other Bills to which the provisions of article 207

apply to be reserved for the consideration of the President after they are passed by the Legislature of the State

(b) it shall be competent for the President during the period any Proclamation issued under this article is in operation to issue directions for the reduction of salaries and allowances of all or any class of persons serving in connection with the affairs of the Union including the Judges of the Supreme Court and the High Courts.

Effects of Financial Emergency

  1. The executive authority of the Centre extends
  • to directing any state to observe such canons of financial propriety as are specified by it;
  • to directions as the President may deem necessary and adequate for the purpose.
  1. Any such direction may include a provision requiring the reduction of salaries and allowances of all or any class of persons serving in the state and the reservation of all money bills or other financial bills for the consideration of the President after they are passed by the legislature of the President may issue directions for the reduction of salaries and allowances of all or any class of persons serving the Union and the judges of the Supreme Court and the high court. Thus, during the operation of a financial emergency, the Centre acquires full control over the states in financial matters.

 

DIFFERENCE BETWEEN ARTICLE 352 AND ARTICLE 356?

Point of Difference ARTICLE 352 ARTICLE 356
Application In situations of war, external aggression or armed rebellion. In situation of failure of constitutional machinery in State
Effect No authority to the Centre to suspend the Constitution in a state. The state legislature ceases to function as it is dissolved.
Effect on Fundamental Rights affects Fundamental Rights Does not affect Fundamental Rights
Centre-State Relationship the relationship of all the states with the Centre changes the relationship of only one state where the action is taken changes with the Centre
Proclamation Approved by the Parliament within 1 month and thereafter every 6 months and there is no maximum duration prescribed Approved by the Parliament within 2 months and thereafter every 6 months, and the maximum period that it remains in force is 3 years.

IMPLICATION

As per the articles 352, 356 and 360 in the Constitution of India, President of India have been given extraordinary power to declare an emergency to meet any threat to the country. Those powers to President of India in Constitution are called emergency provisions. This could have been constitutional provision exercised by central government i.e. imposition of emergency which would have given the country a unitary structure, allowing it to override the directions of the states. However the declaration of an emergency would have been counterproductive, It would have meant that all powers would have vested with the Centre whereas this is a situation where the state government’s response is critical, as health and police are being dealt by state and states must be backed by power to deal with this emergency, where urgent and quick decisions are need of the hour.

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