A special bench headed by chief justice NV Ramana told the Union government that the Supreme Court is not keen on having a confrontation, but its patience is running out on delay in filling up vacancies at critical tribunals. Around 250 posts are lying vacant at various key tribunals, such as National Company Law Tribunal (NCLT), Debt Recovery Tribunal (DRT), Securities Appellate Tribunal (SAT) and Telecom Disputes Settlement and Appellate Tribunal (TDSAT).
The bench, also comprising justice DY Chandrachud and justice L Nageswara Rao, says tribunals across the country are on ‘the verge of collapse’, and some are only working with one member, and cases are being adjourned by as much as a year.
Chief justice Ramana told solicitor general Tushar Mehta, “We are upset, we will give you three to four days.” The bench clearly told Mr Mehta to convince the government to fill long-pending vacancies at tribunals by the next hearing on 13 September 2021.
The matter has remained unresolved since 2017 when the ministry of finance notified rules regarding qualifications, duration of tenure and composition of the search-cum-selection committees. The apex court struck this down in 2019.
The Union government made several attempts to introduce these rules, which were thwarted by the apex court, including the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance. Despite this, on 13 August 2021, the Tribunal Reforms Bill was passed in Parliament. On 16th August, the apex court termed the passing of the bill as ‘serious’.
The Tribunal Reforms Act has provisions similar to the ones struck down by the Supreme Court. Justice Chandrachud even mentioned that the Tribunal Act is ‘virtually a replica of the provisions struck down by the court in the Madras Bar Association case.”
In August, the SC took cognisance at the behest of a public interest litigation (PIL) filed by Congress leader Jairam Ramesh that alleged that the enactment was ultra vires the government’s Constitutional prerogatives.
The Tribunal Reforms Act dissolves eight tribunals, conferring their jurisdiction on high courts and civil courts. It also changes the procedure of the constitution of tribunals, granting the power of appointment and removal upon the search-cum-selection committee (SCSC). Further, a person below the age of 50 is ineligible for an appointment as chairperson or member of the tribunal. The selection committee is expected to recommend three names to the panel, four-year term of members, and salary and terms of appointment to be the same as bureaucrats.
At the beginning of the hearing on Monday, solicitor general Mehta asked for an adjournment in the matter. Denying adjournment, chief justice Mr Ramana says, “You have no respect for the judgments of this court. You are testing our patience.”
Mr Mehta shared a screenshot of a letter addressed to him by the finance ministry on 6th September. The ministry said the rules under Tribunal Reforms Act 2021 are being finalised and will soon be notified. “The new law has paved the way for filling up of vacancies in the tribunals... The government will ensure that within the next two weeks, a decision on appointment to all the tribunals is taken where the Search-cum-Selection Committees-SCSCs have already given their recommendations to the government,” the letter says.
However, the contents of the letters did not budge the bench, which instead shot a volley of questions at Mr Mehta while making critical observations on the Act.
Justice Rao questioned the assurance in the ministry’s letter regarding filling up vacancies in the tribunals. He asked the solicitor general, “The appointments have been pending for over a year-and-a-half. Why were these appointments not made?”
The bench says, “Next time we issue a judgement, there will be a new law contrary to the judgement. It is a replica!”
Justice Chandrachud noted that names for appointments were cleared by the intelligence bureau (IB) and then by a committee that included top court judges and senior-level bureaucrats.
“No clarity, why they are deleted? We sat together with bureaucrats and made decisions. It is a waste of energy,” said justice Chandrachud.
Justice Rao says if appointments were not made, then tribunals would have to be closed. “Emasculating by not appointing members,” he added.
Chief justice Mr Ramana told solicitor general Mr Mehta that you never advise the government to make legislation after legislation, “This is how the bureaucracy functions, I understand! But government needs to take a call.”
“We are not interested in or inviting any confrontation. We are listing it next Monday. By that time, see that appointments are made,” the chief justice added.
Further, he says, “We are happy with the appointment of judges (nine judges to the apex court). We do not want any confrontation with the government.”
The chief justice emphasised that the Union government should fill up vacancies in tribunals, as it did for the Supreme Court.
He told Mr Mehta, “The tribunals have virtually collapsed. Why are you so particular about the tribunals?”
Justice Chandrachud also told the solicitor general that NCLT and NCLAT are critical to the economy and important for the rehabilitation of corporate entities. He added that important cases are not being heard because of vacancies and that not appointing members at these tribunals creates a very critical position.
The bench did not record these oral observations of the Court order; instead, it asked Mr Mehta to engage with the government on appointments. Mr Mehta said that he would convey it to the government.
The bench told the solicitor general, “No, ‘conveying’ is something else. If you don’t want an order from us, you pass the order of appointments.”
If orders are not implemented, the apex court says it has options, like staying the Tribunal Reforms Act, closing down tribunals, appointing people to fill vacancies, and initiating contempt of court proceedings.
Concluding the hearing, chief justice Mr Ramana stressed that the Court expects some appointments to be made by Monday.