Supreme Court stays Rs 326 crore execution order against Arunachal Pradesh government

NEW DELHI: The Supreme Court has stayed an execution order worth Rs 326 crore against the Arunachal Pradesh government and lifted a freeze on its assets and bank accounts in a 10-year battle over payments to food grain transporters. The top court's order will bring relief to the north-eastern state, where governance had come to a virtual halt and government employees could not be paid their salaries.

A group of 28 private transporters had filed for the execution of the decree, claiming the state government hadn't paid them as agreed for carrying food grains meant for the public distribution system, a central government-sponsored programme, in 2004. The transporters had been contracted to lift food grains from the railhead and drop them off at distribution centres in the predominantly hill state.

They were to be reimbursed after their bills were checked by the Food Corporation of India, the agency responsible for ensuring the availability of PDS food grains throughout the country.

According to FCI, the legal imbroglio was due to a dispute with the state government. The agency stopped all payments in 2004, claiming that the state had overpaid the contractors. The Supreme Court stayed the execution and attachment order on September 26 on a plea filed by senior advocate Rajiv Dutta on behalf of the state, which said the government was unable to pay the salaries of its employees.

An Arunachal court ordered the attachment of all the bank accounts and assets of the state government after it failed to pay Rs 258 crore as directed in the second round of execution proceedings. The state government had earlier paid up Rs 158 crore before throwing up its hands. The FCI had said that no further disbursements would be made to the state under the hill transport subsidy scheme until disciplinary action was taken against officers responsible for paying amounts in excess of the rolling advance of Rs 10 crore.