Leader of Opposition Moves Gauhati High Court Over Assam Govt’s Fiscal Violations

Leader of the Opposition in the Assam Legislative Assembly, Debabrata Saikia, has petitioned the Chief Justice of the Gauhati High Court seeking suo motu cognizance under Article 226 of the Constitution of India against what he termed persistent and systemic violations of the Assam Fiscal Responsibility and Budget Management (AFRBM) Act, 2005 and related constitutional provisions by the Himanta Biswa Sarma-led government. Saikia warned that these breaches have led to an unsustainable debt crisis, posing a “grave threat to the economic stability and fundamental rights of the people of Assam.”

In his detailed 11-page representation, Saikia accused the government of adopting “cosmetic accounting practices, misclassifications, and off-budget borrowings” that mask financial realities and facilitate potential corruption, as highlighted in successive Comptroller and Auditor General (CAG) reports. He further alleged that key financial decisions are being taken by the state cabinet as post-budget announcements without legislative approval, in violation of Articles 202, 266, and 293 of the Constitution, which mandate parliamentary scrutiny of financial proposals.

Debt Surge and AFRBM Breaches

According to Saikia, Assam’s outstanding liabilities have ballooned by over 107% in just four years, rising from ₹59,425.61 crore in 2018-19 to ₹1,84,463 crore by July 2025. The debt-to-GSDP ratio now stands at 25.2%, alarmingly close to the AFRBM ceiling of 28.5%, far exceeding the 15th Finance Commission’s recommended limit of 20%.

Despite the AFRBM Act mandating a fiscal deficit cap of 3% of GSDP, Assam has recorded repeated breaches:

• 2019-20: 4.29%

• 2021-22: 4.83% (Revenue deficit of 2.4%)

• 2022-23: 6.50% (Revenue deficit of 3.0%)

• 2023-24: 5.2% (Revised estimate)

• 2024-25: 3.88% (Revised estimate)

These figures, Saikia stated, reflect a pattern of fiscal indiscipline that threatens the state’s financial health, crowding out investments in education, health, and infrastructure.

CAG Red Flags: Mismanagement and Corruption Concerns

CAG reports for 2021-22 and 2022-23 highlight serious financial irregularities, including:

• Understatement of deficits: Fiscal deficit understated by ₹933.22 crore; revenue deficit by ₹6,559.34 crore in 2021-22.

• High committed expenditure: 65.94% of revenue receipts spent on salaries, pensions, and interest payments.

• Underutilization of funds: ₹28,740.07 crore savings across 49 grants; urban development saw 33% underutilization.

• Pending utilization certificates: ₹37,991.70 crore worth of certificates pending submission.

• Misclassification of ₹6,668.99 crore of grants-in-aid as capital expenditure, inflating capital outlay and concealing revenue deficit.

• Off-budget borrowings: ₹1,091 crore raised through state PSUs without reflecting in official budget documents.

“These irregularities indicate a systematic attempt to obscure financial realities and enable misappropriation,” Saikia noted. He linked the CAG revelations and financial irregularities in PWD to the recent suicide of engineer Joshita Das, alleging that corruption within the department has reached alarming levels.

Impact on Governance and Public Welfare

The letter warns that fiscal mismanagement has resulted in:

• Reduced capital expenditure: A 20.51% drop between 2021-22 and 2022-23.

• Contractor payment delays: Highlighted in Gauhati High Court’s order in WP(C) 2220/2023 (Rishi Gupta vs State of Assam).

• Inflationary pressures: Rising debt fueling borrowing costs and reducing private investment.

• Erosion of welfare spending: 58% of revenue receipts in 2023-24 consumed by committed expenditure.

Cabinet-Approved Freebies Before 2026 Elections

Saikia accused the government of announcing unbudgeted freebie schemes through cabinet decisions, bypassing legislative scrutiny. Some of the schemes flagged include:

• Chief Minister’s Jibon Prerona Scheme: ₹2,500 monthly to job-seeking graduates; ₹20,000 to research scholars.

• Prerona Asoni: ₹300 monthly aid for Class X students.

• Monthly assistance to Udasin Bhakats: ₹1,500 per monk.

• Enhanced remuneration for Gaon Pradhans: Increased from ₹9,000 to ₹14,000.

• CM FLIGHT Program: ₹1.5 lakh subsidy for Japanese language training.

• ₹5,000 handout to seven lakh tea garden workers, costing ₹342 crore.

“These cash transfer schemes, declared without vote-on-account, violate Articles 203 to 205 and risk being used as electoral inducements ahead of the 2026 Assembly polls,” Saikia argued, citing Supreme Court observations in S. Subramaniam Balaji vs State of Tamil Nadu (2013).

Legal Grounds and Judicial Precedents

The petition invokes landmark judgments including Common Cause vs Union of India (1996), State of Kerala vs Union of India (2024), and Ashwini Kumar Upadhyay vs Union of India (2022) to justify judicial intervention in matters of fiscal mismanagement. Saikia emphasized that the state has a fiduciary duty to manage public funds responsibly, and failure to do so infringes upon fundamental rights under Articles 14, 19, and 21.

Reliefs Sought by Saikia

Saikia urged the High Court to:

1. Take suo motu cognizance of AFRBM Act violations.

2. Direct CAG to conduct a time-bound audit of 2024-25 compliance.

3. Issue an interim stay on new freebies and cash transfer schemes not included in the annual budget.

4. Constitute an expert committee including a retired judge, financial experts, and representatives nominated by the Leader of Opposition.

5. Mandate framing of AFRBM compliance rules under Section 9 of the Act.

“The fiscal trajectory of the Assam government mirrors the period of severe economic crisis during the AGP regime of 1985–1990. If left unchecked, this could lead Assam into a financial collapse akin to the Sri Lankan debt crisis,” Saikia warned, calling for urgent judicial intervention to safeguard public interest.

Here's the Letter Petition to Gauhati High Court on AFRBM Act Violations

Annexures Listed Page by Page from the Report

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