Guest Post: Concerns Around the Tribunals Reform Ordinance

[This is a guest post by Shubhansh Thakur.]


Tribunals were introduced into our justice dispensation system with the expectation to ease the burden of the traditional courts by bestowing upon them the jurisdiction to deal with certain specified matters. Certainly, it turns out that they have attained a prominent place in the adjudication of statutory rights and liabilities. The genesis of these tribunals can be traced to Articles 323A and 323B, where the former provides for the establishment of administrative tribunals as the parliament may by law provide, while the latter authorises the establishment of other tribunals falling within the subject matter specified in the second clause. The legislature has, in the exercise of its authority, established numerous tribunals to date for adjudication of several subject matter-specific disputes and correspondingly made convoluted attempts to encroach upon the independent functioning of these tribunals. One such attempt of the legislature will form the subject matter of this post: the recently promulgated “The Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021” (“Ordinance”) amending the Finance Act,2017 (“Act”).

The Ordinance among other things has amended Section 184 of the Act dealing with the qualification and appointment of Chairperson and other members of the tribunal. To give a broad overview, the said section is the result of various directions rendered by the Supreme Court (“SC”) in the course of thwarting legislative attempts to retain control over the appointment for tribunals. On an overt reading of the amended section, the legislature seems to follow what has been laid by the SC but the detailed scrutiny indicates to the contrary. Here, I shall delve upon those details to highlight the dichotomy.

Initially, I shall set the background by discussing the major decisions of the court which have culminated in the Ordinance. Against this backdrop, I will argue that the Ordinance does little to solve the already existing issues, and creates scope for the creation of new ones. The Ordinance as a whole shows the need for the SC to revisit its theory of “the casting vote to CJI” as a sole means to ensure judicial dominance. The Ordinance violates several directions of the SC, but I shall restrict myself to the composition of the committee responsible for making appointments to tribunals and its impact on the primacy of the judiciary.

BACKGROUND

Before moving on to the substantive parts of the Ordinance, it is necessary to take a bird’s-eye view of the long-drawn litigation around appointments to these tribunals. The controversy erupted from the case of S.P. Sampath Kumar v. Union of India, where the ‘Administrative Tribunals Act, 1985’ was challenged. The court struck down Sec.6(1)(c) of the impugned Act, which made civil servants eligible for appointment as Chairman in these tribunals. The court saw these tribunals as complete substitutes for the HCs and thus viewed the chairman as akin to a High Court (“HC”) judge and held that such posts must be acquired by a person of proven competence with experience in the legal background, like retired HC judges. The court believed public trust and confidence would be breached if civil servants without any legal experience in fair adjudication would be left to decide the disputes. Another provision conferring exclusive discretion with the government for appointments to tribunals was also held to be unconstitutional for the reason that the government cannot have an unfettered discretion in appointing members to tribunals which are akin to HC. The court recommended alternative approaches to overcome executive control i.e. either to consult the CJI before making an appointment to these tribunals (and no appointment should be made over his/her disagreement unless for cogent reasons), or to form a high powered committee headed by the CJI, or another SC judge, or an HC judge as a nominee of the CJI, to select appointees. 

Thereafter, in L. Chandra Kumar v. Union of India, the appointment of administrative members to tribunals was challenged for their non-expertise in fair adjudication. The court annulled those challenges and noted that blanket removal of such members would strike at the very idea behind the establishment of tribunals, which were envisioned as specialised bodies where trained administrators with grass-root experience will pool in their subject-specific knowledge with the judicial members (“JM”) to reach a fair and reasoned decision. The court, by overruling the view in Sampath Kumar, held these tribunals to be supplemental to the existing HC rather than acting as their substitutes. Moreover, the decisions of the tribunals were held to be reviewable by a division bench of the HC (¶93). The court also believed that a committee headed by the CJI would ensure the recommendation of competent administrative members.

In 2010, part I-C and I-D of the Companies Act,1956 were challenged in the case of Union of India v. R. Gandhi (“R Gandhi”). The impugned parts authorised the transfer of cases from several courts to tribunals arising out of the Companies Act. The SC repelled those challenges and upheld the competence of the legislature to transfer the matters from courts to tribunals and to prescribe the eligibility criteria for appointees. However, such eligibility criteria were held to be alterable by the courts as a part of judicial review to make them comply with the independence of tribunals. The court also altered the composition of the committee responsible for appointments in tribunals due to the absence of members from judicial wing. The government was directed to include two members from the judiciary, consisting of CJI or his nominee, and any other SC or HC judge to be nominated by CJI, apart from two members from the executive wing. In the case of Madras Bar Assn. v. Union of India (“NTT case”), the aforementioned principles were reiterated to quash the formation of the National Tax Tribunal to substitute the HC, without having the salient features of a HC (¶128). 

Then came the recent case of Rojer Mathew v. South Indian Bank (“Rojer Mathew”), wherein the provisions contained under Section 184 of the Act (which has been now amended) and rules framed thereunder were challenged on the ground of excessive delegation and as being contradictory to the previous directions of SC. The SC upheld Sec. 184 but the committee responsible for recommending appointees to these tribunals was overruled since the role of the judiciary in the committee was absent except for virtual representation. The court directed the government to include members from judiciary on the lines of the Gandhi Case. The court by relying upon the fourth judges’ case also observed:

“We are in complete agreement with the analogy elucidated by the Constitution Bench in Fourth Judges case [SC Advocates-on-Record Assn. v. Union of India, (2016) 5 SCC 1] for compulsory need for exclusion of control of the executive over quasi-judicial bodies of tribunals discharging responsibilities akin to courts.”

This exclusion of executive control as per the fourth judges case is a means to preserve the independence of judiciary (¶921). The primacy of the judiciary in appointment includes two elements i.e. initiation and finalisation of the names to be appointed (¶1071 of fourth judges case). The primacy is rendered to the judiciary because (or so these judgments argue) it is best suited to judge the competence of the appointees in comparison to the government, which is certainly not better qualified or equipped to do so. It is for this reasoning that the government cannot reject the names recommended by judiciary (¶692) for appointments in HC and SC. Applying these principles, the role of judiciary in tribunal appointment should also be as imperative as in judicial appointments, especially when the SC has acquiesced to the principles in fourth judges case. This premise will be used subsequently while dealing with the Ordinance.

ANALYSIS

Vexatious Provisions

Sec. 184 (3) of the Ordinance lays down the composition of the Search-cum-Selection Committee (“Committee”), which will recommend the names to the government for appointments to be made in the Tribunals mentioned in the Eighth Schedule of the Act. This Committee will consist of (i) CJI or any other judge of the SC nominated by CJI, as the Chairperson with a Casting Vote; (ii) two Secretaries, to be nominated by the government; (iii) one other member who will vary depending upon the Tribunal and post concerned. Such a member for the appointment of a new chairperson will be the outgoing chairperson of the Tribunal while in cases of an existing chairperson seeking re-appointment, a retired HC or SC judge is to be nominated by the CJI. Moreover, if the appointments relate to the Industrial Tribunal, Debt Recovery Tribunal or in a case where the chairperson to be appointed is not a retired judge of an HC or SC (usually a technical member) or for any other notified tribunal, the fourth member in the committee will necessarily be a retired HC or SC judge, to be nominated by the CJI. All the aforementioned members of the committee will have voting power. Additionally, the Committee will also have a Secretary from the concerned department or ministry, under which the Tribunal has been constituted, who will act as a convenor, without voting authority. 

Broadly speaking, the Committee will include the CJI or her nominee as the sole representative of the judiciary, while others include outgoing members of the tribunal or the retired judge of SC or HC along with a couple of representatives from the executive wing. While the composition per se may not appear to be troublesome, it becomes so when seen in conjunction with other provisions of the Ordinance. One such provision is Sec.184(8) which grants immunity to appointments from being declared invalid merely due to the absence of a member or a vacancy in the Committee (“vacancy provision”). 

Thus, applying the principles of the Fourth Judges’ case as accepted in Rojer Mathew, primacy must be rendered to the opinion of the judiciary (which includes initiation and finalisation of names). Since the Committee has a sole representative from the judiciary, its role is pervasive and imperative. Any appointment made in defiance to the opinion of such a representative will defy primacy to the opinion of the judiciary, which cannot withstand constitutional scrutiny. It is also essential to point out that the appointees also include technical members, who are usually retired Civil Servants and whose competency can be best judged by the government and not the judiciary. The government can certainly recommend the person to be appointed, however, that advice will have to be approved by the representative of the judiciary before the name can be initiated and mulled in the committee.

However, there can be two situations where the role of CJI/its nominee is at the risk of being undermined due to vacancy provision. The two situations have been discussed below:

Situation IWhen the CJI/its nominee due to some contingency could not attend the committee meeting and a name has been recommended for appointment.

At the outset, it is essential to point out that the subsections do not prescribe a valid quorum for a committee meeting; instead, immunity is granted via vacancy provision to appointments made in the absence of members. However, while the Committee is free to frame its procedure, this power cannot be extended for prescribing a valid quorum for the meeting as the same would stand to nullify the effect of the vacancy provision. In other words, such a rule of procedure, if framed, would be ultra vires the parent legislation and hence invalid.

Thus, a valid quorum in the absence of a rule/provision fixing the quorum will be governed by the case of Ishwar Chandra v. Satyanarain. The SC, in this case, has held that a meeting of a committee will be valid as long as the majority of the members are present in the meeting. This majority has been interpreted to mean the majority of the members possessing voting power, which in the scenario under discussion adds to 3 [i.e. half of total plus one (4/2+1)].

A conjoint reading of the aforementioned paragraphs goes on to show that a meeting can be held to be valid even in the absence of the CJI and the recommendation made in the meeting will remain unaffected due to vacancy provision.  In such a case, consultation with the CJI can be avoided altogether, let alone the aspect of primacy to her opinion.

Situation IIWhen the CJI has attended the meeting but does not agree to a particular proposal while other members do.

It would also not be an unlikely scenario to imagine that the CJI does not agree to a particular proposal for an appointment, while the other three members of the Committee may. In such a case, can the appointment be held to be valid? Unfortunately, based on the Ordinance, the answer is in the affirmative. In such a case, Casting Vote will do no good because it cannot be exercised unless there is a deadlock in the Committee concerning a particular proposal.

The primacy of the judiciary in these appointments cannot be ensured unless a particular proposal receives the concurrence of CJI along with the rest of the members. This is because she/he is the sole representative of the judiciary and best suited to judge the competence of the appointees for their effective and independent discharge of functions. The primacy will be completely vitiated when a name is recommended to the disagreement of CJI and Casting Vote does nothing to make up for such disagreement. 

Escaping the Constitutional Safeguards

The importance of consultation with the CJI (as a representative of the Judiciary) and its opinion can also be understood by drawing an analogy with the appointment process of traditional courts, which are sought to be replaced by Tribunals. The Committee is primarily responsible to recommend names for appointment in the Scheduled Tribunals. These Tribunals can be bifurcated into those which are established to replace the subordinate courts exercising original jurisdiction while others include Appellate Tribunals established to supplement the supervisory jurisdiction of HC. In both of these courts, a duty to consult the judiciary has been provided for before an appointment is made by the Governor or President, as the case may be. In appointment to subordinate courts, consultation has to take place with the HC (Art.233) while in the case of appointment to HC, consultation has to be made with the CJI and CJ of HC (Art.217). It is vital to mention that the advice tendered as a result of such consultation process is binding on the government (¶133 of Fourth Judges case). When the Tribunals sought to replace/supplement the traditional courts and perform their jobs (except which the Constitutional Courts have been specifically authorised to do), safeguards in appointment imbibed in the traditional set-up must also be carried forward to the Tribunals. Therefore, consultation with the judiciary cannot be compromised and the advice so tendered as a result of the consultation will have to be adhered to by the government. If this safeguard is not carried forward, the appointments to the Tribunals will provide an indirect route to the government for interfering in judicial appointments, something that the executive has been barred from doing. 

This, however, cannot be achieved with an Ordinance where a mere Casting Vote has been conferred to the CJI. Additionally, the incorporation of vacancy provision would certainly make non-consultation with the CJI in appointments a possibility, if not a certainty. 

Executive Discretion in Finalisation of Names

Apart from this, the government has also kept to itself the power to take a final call on the appointments to be made. This has been done by employing Sec.184(7), wherein the Committee is required to recommend a panel of two names for the government to choose from within three months. It is pertinent to point out that this section has been brought to overrule the judgement of Madras Bar Assn., wherein a rule of like nature has been quashed by the SC (¶53(iii)). The court had explicitly directed the government to limit the recommendation to a single name while keeping the other person waitlisted, to be recommended if the previously recommended name has not been approved by the Intelligence Bureau. The SC’s direction is also intending to preserve the primacy rendered to the opinion of the judiciary, of which finalisation of the name to be appointed is an integral part. The executive by this has made yet another attempt to impinge upon the task exclusively reserved for the judiciary. Hence, this provision violates the primacy of the judiciary in such appointments and abridges separation of power forming part of the basic structure of the Constitution, which cannot be abridged even in the cases of ordinary legislation

WHAT NEEDS TO BE CORRECTED

As reflected above, therefore, the conferment of Casting Vote alone will not ensure judicial dominance in line with the principles laid down in the Fourth Judges’ case. Rather, a veto must lie with the CJI to overturn the Committee’s decision, to make primacy to the opinion of the judiciary meaningful in such appointments. This veto power will at all times be guarded with judicial review, giving the aggrieved party a remedy for overturning it, when exercised arbitrarily. If this cannot be done, then the court must issue a writ of mandamus and direct the government to replace or supplement the vacancy provision with a proviso that a meeting cannot be valid unless the CJI is present in the meeting and an appointment in the absence and without the concurrence of the CJI shall be null and void. Apart from this, the court is expected to strike down the provision where the government has kept to itself the power to take a final call on the names to be appointed and reiterate its previous direction of limiting the recommendation by the Committee to a single name to exclude executive discretion in such appointments.

CONCLUSION

The court has to appreciate the distinction between the existence of an SC judge and an HC judge as against a retired member of the judiciary. The latter cannot be considered to be a representative of the judiciary, even if nominated by the CJI. The purpose is not merely judicial dominance, but primacy to the opinion of presently serving judiciary to ensure independence and competence of these members and the Tribunals as a whole. With these shortcomings in the present system and continuous reluctance on the part of the government to accept the already laid down directions, the time is ripe for the formation of the National Tribunal Commission (“NTC”) to oversee the administrative requirements and appointments to Tribunals. NTC has been discussed at length in Rojer Mathew(¶343), to liberate Tribunal appointments from executive menace. 

NTC will include- three serving judges of the SC along with two serving HC judges, all of them to be nominated by the CJI. The others include two members to be nominated by the government while two experts will be appointed by the government in consultation with the CJI. NTC is sufficiently safeguarded as against the present set-up because the judiciary will be represented by five serving judges in a nine-membered committee. The CJI will also have a role to play in the appointment of experts, leaving the executive representation to a meagre two in a nine-membered committee. Such a majority of the judicial members will ipso facto ensure effective consultation among judicial members and there will always be a couple of members from the judiciary to make its representation in any valid meeting. The government must distance itself from judicial appointments as their role is limited to serve as a system of checks and balances and not to drive and control the entire process. 

The Ordinance has already been challenged on several other grounds and one can only expect that the Apex court will reassess its Casting Vote theory and examine the impact of vacancy provision in its adjudication, in order to preserve the public trust in the judicial system.

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