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Synopsis

The Kerala Government has informed the Kerala High Court that the State of Kerala is currently facing a phase of financial constraint.

“Our state is now passing through a phase of financial constraints. Any monetary benefit has to be allowed within the financial resources available with the government,” the affidavit reads.

The affidavit was filed by the state government in response to petitions filed by a Kolkata-based company and others seeking a directive to the Kerala Transport Development Finance Corporation Limited (KTDFC) to return their matured fixed deposits.

Justice Devan Ramachandran directed the government to file a clarificatory affidavit explaining whether the borrowings made by the KTDFC were guaranteed by the government.

The state government's affidavit clarified that no valid, legally enforceable guarantee had been executed by the State government in favour of the KTDFC, as per the provisions of the Government Guarantee Act.

Additionally, the affidavit suggested that KTDFC and the Kerala State Road Transport Corporation (KSRTC) have the option to mortgage their property or sell specific items of the property to outside parties or government agencies.

Additionally, the affidavit stated that the government is not legally bound to give financial support to meet its day-to-day affairs to the KSRTC.

“Even though the government is supporting Public Sector Undertakings, including KSRTC, in different ways, it is obvious that the government is not legally bound to give financial support to meet its day to day affairs,” the affidavit reads.

Source: PTI