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Why did the Supreme Court, in their judgment of September 2003, hold that privatisation of HPCL and BPCL was not permissible ?
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- Due process of law for disinvestment had not been followed.
- It is against the interest of the capital asset in the form of their employees.
- It had not been recommended by the Disinvestment Commission.
- It is in conflict with the statues that created HPCL and BPCL.
- Due process of law for disinvestment had not been followed.
Correct Option: D
The Supreme Court, on September 17, 2003 restrained the Union Government from proceeding with the privatisation of two major public sector enterprises — Hindustan Petroleum Corporation Ltd. and Bharat Petroleum Corporation Ltd., holding that disinvestment in them could not be done without prior Parliament approval. The only question before it was whether disinvestment in these two oil majors could be made without parliamentary approval as they were governed by specific statutes — ESSO (Acquisition of Undertaking in India) Act, 1974 and the Burma Shell (Acquisition of Undertaking in India) Act, 1976. The Bench pointed out that in the preamble of the two Acts acquiring the assets of the foreign companies, it was stated that the acquisition was done to ensure that the ownership and control of petroleum products, distributed and marketed in India by the said companies, were vested in the State and thereby so distributed as best to sub serve the common good.
