NEW DELHI: The Centre and the Kerala government on Monday told the Supreme Court that the dialogue and possible settlement between both the parties in connection with their dispute over financial allocation to the state had failed despite their best efforts.
The submissions were made before the apex court bench by Additional Solicitor General (ASG) N Venkataraman for the Centre and senior lawyer Kapil Sibal for Kerala.
The Supreme Court has agreed to hear the case at length on March 6 and 7.
The two-judge bench of the top court, headed by Justice Surya Kant and also comprising Justice K V Viswanathan, was hearing the Kerala government's prayer for interim relief application alleging that the Centre illegally interfered in the state's finances and budgeting.
Following the suggestion on February 13 of the apex court, which had directed the Centre and Kerala government to sit and talk to resolve the issue over the cap on net borrowing, both the parties had tried for a settlement.
Attorney General (AG) R Venkataramani, the top law officer of the central government, had, in the last hearing on February 13, told the Supreme Court that it was ready to discuss the dispute with the Kerala government.
Senior lawyer Kapil Sibal, appearing for the Kerala government, had told the apex court that the state has also agreed to send a delegation to Delhi to conduct a dialogue with representatives of the central government.
Justice Surya Kant had earlier stressed the need and importance of genuine initiative and dialogue in resolving the impasse over the issue.
"Whether the state or the Centre, there are seasoned administrators who have in their public life seen the world in different capacities. We are confident that you will be able to find a solution," Justice Kant had said with optimism.
AG Venkataramani had earlier told the Supreme Court that the the Kerala government was attempting to cover up its own failures on the issue of finances and budgeting.
The Kerala government, in its petition filed in the top court, has alleged that the Centre is unnecessarily interfering in the state's finances and said that due to such interference, the state is not able to fulfil the commitments in its annual budget.
It said that the Centre is imposing a net borrowing ceiling, which is incorrect.
The Kerala government said that the alleged interference by the Centre has resulted in huge arrears that it owes by way of welfare schemes to the people of the state particularly the poor and the vulnerable, various beneficiary groups, employees of the state government, its pensioners and dues to its state-owned enterprises.
