Eco Survey calls for enhanced efficiency in judiciary to help improve ease of doing biz

The Economic Survey Thursday suggested reducing the number of holidays of courts, and appointing more judges to enhance productivity in the judiciary system, stating that delays in contract enforcement and disposal resolution are biggest hurdle to the ease of doing business in India.

As per the Economic Survey for 2018-19, tabled in Parliament by Finance Minister Nirmala Sitharaman, 3.5 crore cases are pending in the judicial system, much of which are concentrated in the district and subordinate courts.

"In spite of a number of actions to expedite and improve the contract enforcement regime, economic activity is being affected by the long shadow of delays and pendency across the legal landscape. Contract enforcement remains the single biggest constraint to improve our ease of doing business (EODB) ranking," the survey highlighted.

It said India continued to lag on the indicator for enforcing contracts, climbing only one rank from 164 to 163 in the latest EODB report, 2018.

Delays in contract enforcement and disposal resolution are arguably the single biggest hurdle to the ease of doing business in India and higher GDP growth, it added.

However, the problem is not insurmountable, it said adding "a case clearance rate of 100 per cent (zero accumulation) can be achieved with the addition of merely 2,279 judges in the lower courts and 93 in High Courts even without efficiency gains".

The survey further said this is already within sanctioned strength and only needs filling vacancies.

"Scenario analysis of efficiency gains needed to clear the backlog in five years suggest that the required productivity gains are ambitious, but achievable. Given the potential economic and social multipliers of a well-functioning legal system, this may well be the best investment India can make," it said.

Suggesting measures to enhance productivity in the judiciary, the survey listed increasing number of working days of courts, establishment of Indian Courts and Tribunal Services (ICTS) that focuses on the administrative aspects of the legal system and technology deployment.

For instance, the survey said,"the Supreme Court's official calendar for 2019 suggests that it would close for 49 days for summer vacations, 14 days for winter break, and a further 18 days for Holi, Diwali and Dussehra".

After accounting for weekends and public holidays, it leaves 190 working days for the Supreme Court. In contrast, the average is 232 working days for High Courts and 244 days for Subordinate courts, it pointed out.

There is a great deal of variation between states, and many courts make up for vacations by working on Saturdays, the survey said, adding "central government offices will be open for 244 working days in 2019 (all above excluding personal leaves)".

It further said increasing the number of working days may improve productivity of the Supreme Court and in some High Courts, but is unlikely to significantly impact lower courts.

"Subordinate courts, which account for the bulk of pendency, seem to work almost as many days as government offices," it said.

According to the survey, the backlog in lower courts can be cleared in five years at full sanctioned strength with an efficiency gain of 24.5 per cent. At current working strength, it would take an efficiency gain of 58 per cent.

"One major effort in this direction is the eCourts Mission Mode Project that is being rolled out in phases by the Ministry of Law and Justice," the survey said, it has allowed creation of the National Judicial Data Grid (NJDG).