The face-off between Andhra Pradesh and Telangana to divide the assets of government institutes and agencies listed in the 10th Schedule of Andhra Pradesh Reorganisaton Act 2014, majority of which are located in Hyderabad, doesn’t seem abating.
Last week, the Telangana government sought the postponement of the crucial meeting of a committee constituted by Government of India at the behest of the Supreme Court to resolve the dispute over the 10th schedule entities, loosely defined as training institutes numbering 147.
However, the reason cited by Telangana government sources was that chief secretary Rajiv Sharma, who is a member in the committee, was currently on leave.
“Everyone has to act within the constitutional framework. If the issue is not resolved by the committee, we will again approach the court,” said one of the AP members named in the committee, when asked about a possible delay in resolving the current stand-off.
The apportionment of assets, liabilities and staff in proportion to the population of the successor states was the general principle that was adopted for the bifurcation of Andhra Pradesh.
This principle was extended to the entities listed in the 10th Schedule after the successor AP state insisted on its share in the assets of these entities. The assets include land, buildings besides movable properties such as computers, vehicles and furniture.
While there was no explicit mention in the bifurcation Act about the division of assets of 10th Schedule entities, the Supreme Court had ruled that Section 47 of the Act, which provides for the apportionment of assets and liabilities among the successor states, equally applies to these entities.
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The court had also directed the Centre to resolve the issue within two months from the date of representation was made (by the parties) if the successor states were unable to arrive at an agreement.
The Centre had constituted a committee on August 8, 2016 under the chairmanship of Jaideep Govind, additional secretary of the Union Ministry of Home Affairs to resolve the issue. The committee held its first meeting on September 23 and was scheduled to meet again on November 18. The two-month time line set by the Supreme Court to resolve the dispute is already over.
Interestingly, there was no fundamental dispute between the two parties over the division of assets of the government undertakings that were separately listed in Schedule 9 of the Act along with a scheme of division of their assets, which was based on location. A power plant located in AP will entirely belong to that state while the same principle applies to a power plant located in Telangana.
However, the dispute erupted over the entities listed in the 10th Schedule and quickly reached the courts and from there to the Centre when Telangana government had sought to apply this location principle to the AP State Council of Higher Education Council (APSCHE) in early 2015.
On May 1, 2015, the Hyderabad High Court had also ruled in favour of the Telangana government’s decision to freeze the bank accounts of
APSCHE in a petition filed by the AP government though these orders were completely nullified by the Supreme Court in its judgment on March 18, 2016.
The Telangana governments had filed two revision petitions challenging this judgment but were dismissed. It was rumored that the government might once again appeal against the Supreme Court orders by filing a curative petition this time around, though it was yet to make any move.
There were reports that the AP government was willing to accept cash compensation in exchange for its share of assets of 10th Schedule entities. These reports also mentioned the total value of the AP's share in these assets to be ~30,000-40,000 crore.
“These are details one can discuss later, once the Telangana government agrees to the basic principle of apportionment of assets with regard to the 10th schedule entities. These numbers will only serve the purpose of creating some sensation around the subject,” a senior AP government official told Business standard.
The officer said the government has not done any valuation exercise in this regard but would undertake such exercise whenever such a need arises.
It may be recalled that Telangana Chief Minister K Chandrasekhara Rao had demanded that the Centre file an affidavit in the Supreme Court in support of Telangana's claim over the 10th Schedule entities but in vain. When the Supreme Court was hearing the special leave petition filed by the AP government over the APHEC issue, Solicitor General Rajit Kumar appearing on behalf of the Union of India maintained that the ownership and the division of the assets of the erstwhile APSCHE would be governed by Section 47 of the Reorganisaton Act.
The list of entities in the 10th schedule include Institute of Health and Family Welfare, AP Police Academy and a host of other training and research institutes, which do not have any statewide network.