The Delhi High Court has clarified that statements made during parliamentary debates cannot override enacted legislation or prevent the Central Government from reducing its shareholding in IDBI Bank. The ruling was delivered on 17 December 2018 in All India IDBI Officers’ Association v. Union of India & Others, in which the Court dismissed the writ petition challenging the Government’s position on its stake in IDBI Ltd.
The dispute arose from legislative discussions in 2003 concerning the Government’s shareholding in IDBI. During the consideration of the IDBI (Repeal) Act, 2003, an amendment proposing restrictions on the dilution of the Government’s stake was introduced but was not incorporated into the final legislation.
In paragraphs 41 and 42 of its judgment, the Court held that statements made during parliamentary proceedings could neither replace the enacted statute nor be used to introduce restrictions absent from the legislation. It also rejected the application of the doctrine of promissory estoppel, finding that parliamentary statements in the context of legislative proceedings did not constitute a representation capable of preventing the Government from reducing or divesting its shareholding.
The Court further observed that the IDBI (Repeal) Act, 2003, contained no provision prohibiting the Government from reducing or relinquishing its stake in IDBI Ltd.
The Government’s policy direction concerning the transformation and strategic disinvestment of IDBI Bank was also reflected in subsequent Union Budget announcements. In the 2016–17 Budget, the Government indicated that it would consider reducing its shareholding below 50%. In the 2021–22 Budget, IDBI Bank was included among the entities identified for strategic disinvestment.
The judgment provides an important legal clarification on the interpretation of legislation and the limits of relying on statements made during parliamentary debates. It confirms that the Government’s ability to dilute its shareholding in IDBI Bank cannot be restricted solely on the basis of such statements when the enacted law contains no corresponding prohibition. CASansaar