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The Central Government has filed a plea before the Supreme Court challenging its decision whereby it held that the Delhi Government (GNCTD) will have control over administration of services, except in those areas which are specifically excluded from its legislative domain.

Centre has argued that despite the insertion of Article 239AA in the Constitution, the NCT of Delhi is not elevated to the status of a State and it remains to be a Union Territory. It has been further argued that the Supreme Court's judgement effectively elevates Delhi's status to a full-fledged state by giving its legislative assembly the legislative competence over all entries in List II and List III.

Top Court has been told that its judgement ignores the fact that the working and functioning of the Capital Government affects the nation as a whole.

On May 11, a Constitution bench of Chief Justice of India (CJI) DY Chandrachud, Justices MR Shah, Krishna Murari, Hima Kohli and PS Narasimha held that the Lt. Governor will be bound by decisions of the council of ministers of ministers except in matters which are outside the cabinet's executive domain, i.e. police, public order and land.

The bench stated that Article 239AA 3(A) confers legislative power to GNCTD but not over all subjects and that the union's interests must be protected. Thus, a balance between both the federal polities is pertinent. Top Court has further held that  the parliament has the power to legislate on any subject of GNCTD in any of the three lists of the Constitution, however, if there exists a repugnancy in law enacted by legislative assembly and union, the law enacted by assembly will be void.

Issues of governance concerning the national capital have been at odds between the Centre and the Aam Aadmi Party led Delhi government ever since it assumed office in 2014. The top court reserved its verdict on January 18 this year.

Notably, soon after the Constitution bench pronounced the impugned judgment, an ordinance was issued by the Centre to constitute ‘National Capital Civil Services Authority’ in Delhi which would be headed by Delhi Chief Minister, and will comprise of Chief Secretary and Home Secretary of the Delhi government and would decide on the transfer and posting of Group ‘A’ officers and DANICS officers serving in Delhi government.

Said ordinance stated that the permanent authority is being formed to give effect to the intent and purpose behind Article 239AA and to make recommendations to the Lieutenant Governor (LG) regarding matters concerning transfer posting, vigilance, and other incidental matters.

Background:
On July 4, 2018, the Supreme Court had laid down the broad parameters for governance of the capital while interpreting Article 293AA of the Constitution. It had held that Delhi cannot be accorded the status of a state. While doing so, it clipped the powers of LG stating that he has to act on the aid and advice of the elected government.

On other aspects; the appeals were placed before a larger bench and in 2019, the top court gave a split verdict with Justices AK Sikri and Ashok Bhushan differing on the issue of 'services' under Schedule VII, List II, Entry 41.

On Centre’s request, the issue was then referred to a larger bench.