Madras Bar Association vs Union of India and Anr.

Disposing the writ petition, the Court

HELD:

Per L. Nageswara Rao, J.

1. The permissibility of legislative override in this country should be in accordance with the principles laid down by this Court, which are as under:

a) The effect of the judgments of the Court can be nullified by a legislative act removing the basis of the judgment. Such law can be retrospective. Retrospective amendment should be reasonable and not arbitrary and must not be violative of the fundamental rights guaranteed under the Constitution.

b) The test for determining the validity of a validating legislation is that the judgment pointing out the defect would not have been passed, if the altered position as sought to be brought in by the validating statute existed before the Court at the time of rendering its judgment. In other words, the defect pointed out should have been cured such that the basis of the judgement pointing out the defect is removed.

c) Nullification of mandamus by an enactment would be impermissible legislative exercise. Even interim directions cannot be reversed by a legislative veto.

d) Transgression of constitutional limitations and intrusion into the judicial power by the legislature is violative of the principle of separation of powers, the rule of law and of Article 14 of the Constitution of India.[Para 44][844-C-G]

2. The direction given by this Court in the nature of mandamus in Madras Bar Association v. Union of India & Anr., (2020) SCC Online SC 962 (MBA-III) is to the effect that advocates are entitled for appointment as Members, provided they have experience of 10 years. The first proviso to Section

184 which prescribes a minimum age of 50 years is an attempt to circumvent the direction issued in MBA-III striking down the experience requirement of 25 years at the bar for advocates to be eligible. Introduction of the first proviso to Section 184(1) is a direct affront to the judgment of this Court in MBA-III. This Court in Union of India v. R. Gandhi, President, Madras Bar Association, (2010) 11 SCC 1 and Roger Mathew underlined the importance of recruitment of Members from the bar at a young age to ensure a longer tenure. Fixing a minimum age for recruitment of Members as 50 years would act as a deterrent for competent advocates to seek appointment. Practically, it would be difficult for an advocate appointed after attaining the age of 50 years to resume legal practice after completion of one term, in case he is not reappointed. Security of tenure and conditions of service are recognised as core components of independence of the judiciary. Independence of the judiciary can be sustained only when the incumbents are assured of fair and reasonable conditions of service, which include adequate renumeration and security of tenure. Therefore, the first proviso to Section 184(1) is in violation of the doctrine of separation of powers as the judgment of this Court in MBA-III has been frustrated by an impermissible legislative override. Resultantly, the first proviso to Section 184

(1) is declared as unconstitutional as it is violative of Article 14 of the Constitution. [Para 49][851-B-F]

3. The second proviso to Section 184(1) deals with the allowances and benefits payable to the Members which are to be the same as are admissible to a Central Government officer holding a post carrying the same pay. The second proviso to Section 184(1), read with the third proviso, is an affront to the judgment of this Court in MBA-III. By no stretch of imagination can it be said that the said provisos are a result of curative legislation. The direction issued by this Court in MBA-III for payment of HRA was to ensure that decent accommodation is provided to Tribunal Members. Such direction was issued to uphold independence of the judiciary and it cannot be subject matter of legislative response. A mandamus issued by this Court cannot be reversed by the legislature as it would amount to impermissible legislative override. Therefore, the second proviso, read with the third proviso, to Section 184(1) is declared as unconstitutional. [Para 50][851-G-H; 852-F-G]

4.1. Rule 4(2) of the Tribunal, Appellate Tribunal and other Authorities (Qualifications, Experience and other Conditions of Service of Members) Rules, 2020 pertains to the procedure to be followed by the Search-cum-Selection Committee (SCSC). According to the said Rule, the SCSC should recommend two or three names for appointment to each post. A direction was given in MBA-III to amend Rule 4(2) of the 2020 Rules to provide that the SCSC shall recommend one person for appointment in each post in place of a panel of two or three persons for appointment to each post. One more name could be recommended to be included in the waiting list. Sufficient reasons were given in MBA-III to hold that executive influence should be avoided in matters of appointments to tribunals - therefore, the direction that only one person shall be recommended to each post. The decision of this Court in that regard is law laid down under Article

141 of the Constitution. The only way the legislature could nullify the said decision of this Court is by curing the defect in Rule 4(2). There is no such attempt made except to repeat the provision of Rule 4(2) of the 2020 Rules in the Ordinance amending the Finance Act, 2017. Ergo, Section 184(7) is unsustainable in law as it is an attempt to override the law laid down by this Court. Repeating the contents of Rule 4(2) of the 2020 Rules by placing them in Section 184(7) is an indirect method of intruding into judicial sphere which is proscribed. [Paras 52, 53][853-G-H; 855-A-C]

4.2. The second part of Section 184(7) provides that the Government shall take a decision regarding the recommendations made by the SCSC preferably within a period of three months. This is in response to the direction given by this Court in MBA-III that the Government shall make appointments to tribunals within three months from the completion of the selection and recommendation by the SCSC. Such direction was necessitated in view of the lethargy shown by the Union of India in making appointments and filling up the posts of Chairpersons and Members of tribunals which have been long vacant. The direction given by this Court for expediting the process of appointment was in the larger interest of administration of justice and to uphold the rule of law. Section 184(7) as amended by the Ordinance permitting the Government to take a decision preferably within three months from the date of recommendation of the SCSC is invalid and unconstitutional, as this amended provision simply seeks to negate the directions of this Court. [Para 54][855-C-E, G; 856-A]

5. The tenure of the Chairperson and Member of a tribunal is fixed at four years by Section 184(11), notwithstanding anything contained in any judgment, order or decree of any court. After perusing the law laid down by this Court in Union of India v. R. Gandhi, President, Madras Bar Association and Rojer Mathew which held that a short stint is anti-merit, this Court directed the modification of tenure in Rules 9(1) and 9(2) of the 2020 Rules as five years in respect of Chairpersons and Members of tribunals in MBA-III. This Court declared that the Chairperson, ViceChairperson and the Members of the tribunals shall hold office for a term of five years and shall be eligible for reappointment. The insertion of Section 184(11) prescribing a term of four years for the Chairpersons and Members of tribunals by giving retrospective effect to the provision from 26.05.2017 is clearly an attempt to override the declaration of law by this Court under Article 141 in MBA-III. Therefore, clauses (i) and (ii) of Section 184(11) are declared as void and unconstitutional. [Para 55][856A-B, D-F]

6. Insofar as the proviso to Section 184(11) is concerned, the Ordinance sets the maximum tenure at five years even with respect to the appointment orders passed between 26.05.2017 and 04.04.2021 provide for a higher tenure. In the process, interim directions given by this Court in Kudrat Sandhu are also nullified. Though, there is nothing wrong with the proviso to Section 184(11) being given retrospective effect, the appointments made pursuant to the interim directions passed by this Court cannot be interfered with. While making it clear that the appointments that are made to the CESTAT on the basis of interim orders passed by this Court shall be governed by the relevant statute and the rules framed thereunder, as they existed prior to the Finance Act, 2017, the retrospectivity given to the proviso to Section

184 (11) is upheld. Further, all appointments after 04.04.2021 shall be governed by the Ordinance, as modified by the directions contained herein. [Para 57][857-F-G; 858-B-C, D-F]

7. To conclude, the first proviso and the second proviso, read with the third proviso, to Section 184 overriding the judgment of this Court in MBA-III in respect of fixing 50 years as minimum age for appointment and payment of HRA, Section 184(7) relating to recommendation of two names for each post by the SCSC and further, requiring the decision to be taken by the Government preferably within three months are declared to be unconstitutional. Section 184(11) prescribing tenure of four years is contrary to the principles of separation of powers, independence of judiciary, rule of law and Article 14 of the Constitution of India. Though, the proviso to Section 184(11) has been upheld, the appointments made to the CESTAT pursuant to the interim orders passed by this Court shall be governed by the relevant statute and the rules framed thereunder that existed prior to 26.05.2017. Notice has been already taken of the notification dated 30.06.21 by way of which Rule 15 of the 2020 Rules dealing with HRA has been amended in conformity with directions in MBA-III. [Para 58][858F-H; 859-A] S.R. Bhagwat & Ors. v. State of Mysore (1995) 6 SCC

16 : [1995] 3 Suppl. SCR 545; Cauvery Water Disputes Tribunal (1983) 1 Suppl. SCC 96 : [1991] 2 Suppl. SCR 497; Medical Council of India v. State of Kerala & Ors. (2019) 13 SCC 185 : [2018] 10 SCR 213 and Virender Singh Hooda & Ors. v. State of Haryana & Anr. (2004) 12 SCC 588 : [2004] 5 Suppl. SCR 720 – relied on.

Union of India v. R. Gandhi, President, Madras Bar Association (2010) 11 SCC 1 : [2010] 6 SCR 857; Rojer Mathew v. South Indian Bank Limited & Ors. (2020) 6 SCC 1 : [2019] 16 SCR 1; Madras Bar Association v. Union of India & Anr. (2020) SCC Online SC 962; Madras Bar Association v. Union of India & Anr. (2014)

10 SCC 1 : [2014] 10 SCR 1; S.P. Sampath Kumar v. Union of India & Ors. (1987) 1 SCC 124 : [1987] 1 SCR 435; Minerva Mills Ltd. & Ors. v. Union of India & Ors. (1980) 3 SCC 625 : [1981] 1 SCR 206; L. Chandra Kumar v. Union of India & Ors. (1997) 3 SCC

261 : [1997] 2 SCR 1186; Madras Bar Association v. Union of India & Anr. (2015) 8 SCC 583 : [2015] 6 SCR 638; R.K. Jain v. Union of India (1993) 4 SCC

119 : [1993] 3 SCR 802; Gujarat Urja Vikas Nigam Ltd. v. Essar Power Ltd. (2016) 9 SCC 103 : [2016] 5 SCR 101; Madras Bar Association v. Union of India & Anr. (2020) SCC Online SC 962; Kudrat Sandhu v. Union of India [2018] 10 SCR 956; Smt. Indira Nehru Gandhi v. Shri Raj Narain (1975) Suppl. SCC 1 : [1976]

2 SCR 347; State of Tamil Nadu v. State of Kerala & Anr. (2014) 12 SCC 696 : [2014] 12 SCR 875; I.R. Coelho v. State of T.N. (2007) 2 SCC 1 : [2007] 1 SCR 706; Supreme Court Advocates-on-Record

Association & Ors. v. Union of India (1993) 4 SCC

441 : [1993] 2 Suppl. SCR 659; Union of India v. Sankalchand Himatlal Sheth & Anr. (1977) 4 SCC 193 : [1978] 1 SCR 423; Supreme Court Advocates-onRecord Association & Anr. v. Union of India (2016) 5 SCC 1 : [2015] 13 SCR 1; R.K. Garg v. Union of India & Ors. (1981) 4 SCC 675 : [1982] 1 SCR 947;

T. Venkata Reddy & Ors. v. State of Andhra Pradesh (1985) 3 SCC 198 : [1985] 3 SCR 509; Krishna Kumar Singh & Anr. v. State of Bihar & Ors. (2017) 3 SCC 1 : [2017] 5 SCR 160; State of Madhya Pradesh v. Rakesh Kohli & Anr. (2012) 6 SCC 312 : [2012] 6 SCR 661; K.S. Puttaswamy & Anr. v. Union of India & Anr. (2019)

1 SCC 1 : [2018] 8 SCR 1; Shri Prithvi Cotton Mills Ltd. & Anr. v. Broach Borough Municipality & Ors. (1969) 2 SCC 283 : [1970] 1 SCR 388; Patel

Gordhandas Hargovindas & Ors. v. Municipal

Commissioner, Ahmedabad & Anr. [1964] 2 SCR 608; Janapada Sabha Chhindwara v. Central Provinces Syndicate Ltd. & Anr. (1970) 1 SCC 509 : [1970] 3 SCR 745; I.N. Saksena v. State of Madhya Pradesh (1976) 4 SCC 750 : [1976] 3 SCR 237; Indian

Aluminium Co. & Ors. v. State of Kerala & Ors. (1996)

7 SCC 637 : [1996] 2 SCR 23; Bakhtawar Trust & Ors. v. M. D. Narayan & Ors. (2003) 5 SCC 298 : [2003] 1 Suppl. 1 SCR; Madan Mohan Pathak & Anr. v. Union of India & Ors. (1978) 2 SCC 50 : [1978] 3 SCR 334; Sri Ranga Match Industries & Ors. v. Union of India & Ors. (1994) 2 Suppl. SCC 726; A.V. Nachane & Anr. v. Union of India & Anr. (1982) 1 SCC 205 : [1982] 2 SCR 246; Dr. Ashwani Kumar v. Union of India & Anr. (2020) 13 SCC 585 : [2019] 12 SCR 30; Ram Pravesh Singh & Ors. v. State of Bihar & Ors. (2006) 8 SCC

381 : [2006] 6 Suppl. SCR 512; Union of India & Ors. v. Karnail Singh & Ors. (1995) 2 SCC 728 : [1994]

5 Suppl. SCR 584; State of Punjab & Ors. v. Rafiq Masih (Whitewasher) (2014) 8 SCC 883 : [2014] 8 SCR 228 and State v. Kalyan Singh & Ors. (2017) 7 SCC 444 : [2017] 6 SCR 946 – referred to.

Marbury v. Madison 5 U.S. 137 (1803); United States v. Peters 9 U.S. 115 (1809); Brown v. Board of Education of Topeka 347 U.S. 483 (1954); Cooper v. Aaron 384 U.S. 436 (1966); Miranda v. Arizona 384 U.S. 436 (1966); Dickerson v. United States 530 U.S.

428 (2000) and Plaut v. Spendthrift Farm, Inc. 514 U.S. 211 (1995) – referred to.

Erwin Chemerinsky, The Court Should Have Remained Silent: Why the Court Erred in Deciding Dickerson v. United States, 149 Pennsylvania Law Review 287-308 (2001) and Nicholas Stephanopoulos, The Case for the Legislative Override, 10 UCLA Journal of International Law and Foreign Affairs 250 (2005) – referred to.

Per S. Ravindra Bhat, J. (Concurring)

1. The challenge to the first proviso to Section 184, which prescribes the age qualification, has to be seen from several angles. First, the underlying parent statutes which created the tribunals (ITAT, CESTAT, TDSAT, CAT) did not prescribe, as an eligibility criterion for selection of candidates as members, any minimum age. The prescription of 50 years as a minimum eligibility criterion, in the opinion of this court, is without any rationale. The ITAT has existed for the last 79 years; no less than 33 of its members were appointed as judges of various High Courts; one of them (Ranganathan, J.) was appointed to this court. The CESTAT too has comprised advocates who have staffed the tribunal efficiently. The absence of any explanation for the preference given to older persons, in fact leads to an absurd result- as was pointed out in MBA-III and as has been reiterated by L. Nageswara Rao, J. in his opinion. The Constitution of India makes an advocate who has practiced for more than 10 years, eligible for consideration for appointment as a judge of the High Court and even this Court. An advocate with 7 years’ practice with the Bar can be considered for appointment to the position of a District Judge. Prescribing 50 years as a minimum age limit for consideration of advocates has the devastating effect of entirely excluding successful young advocates, especially those who might be trained and competent in the particular subject (such as Indirect Taxation, Anti-Dumping, Income-Tax, International Taxation and Telecom Regulation). The exclusion of such eligible candidates in preference to those who are more than 50 years of age is inexplicable and therefore entirely arbitrary. As this Court in its previous judgment (Rojer Mathew) has pointed out in another context, the exclusion of such young and energetic legal practitioners could result in not so efficient or competent practitioners left in a field for consideration which would have telling effects on the quality of decisions they are likely to render. [Para 21][874-G-H; 875-A-E]

2. Prescribing 50 years’ minimum age as a condition for appointment to these tribunals is arbitrary also because absolutely no reason is forthcoming about what impelled Parliament to divert from the long-established criteria of giving weightage to actual practice, reputation, integrity and subject expertise, without a minimum age criterion, in the pleadings in this case, nor in any other cases (R. Gandhi –MBA –I; Madras Bar Association –III and Roger Mathew). Such being the case, it is astonishing that in the span of a year (i.e. after the decision in Roger Mathew) ”new thinking” seems to have prevailed to frame rules excluding advocates who can otherwise, based on their expertise, be considered for appointment to even High Courts. [Para 22][875F-H]

3. The consideration of younger advocates in the age group of 40-45 years would have long term benefits since the domain knowledge and expertise in such areas (Telecom Regulation, Taxation –both Direct and Indirect, GATT Rules, International Taxation etc.) would be useful in adjudication in these tribunals and lead to a body of jurisprudence. Depending on how such counsel/advocates fare as members of the Tribunal, having regard to their special knowledge of these laws, at a later and appropriate stage, they may even be considered for appointment to High Courts. [Para 23][876-A-B]

4. The age criteria, impugned in this case also leads to wholly anomalous and absurd results. For instance, an advocate with 18- or 20-years’ practice, aged 44 years, with expertise in the field of indirect taxation, telecom, or other regulatory laws, would be conversant with the subject matter. Despite being eligible, (as she or he would fulfil the parameters of at least 10 years’ practice, in the light of the decision in MBA-III) such a candidate would be excluded. On the other hand, an individual who might have practiced law for 10 years, and later served as a private or public sector executive in an entirely unrelated field, but who might be 50 years of age, would be considered eligible, and can possibly secure appointment as a member of a tribunal. Thus, the age criterion would result in filtering out candidates with more relevant experience and qualifications, in preference to those with lesser relevant experience, only on the ground of age. [Para 24][876-C-E]

5.1. Given that the essential educational qualifications and experience in the relevant field are fixed for all candidates, for a classification based on minimum age for appointment (like in the present case) to succeed, the Union cannot say that it should be held to be valid, irrespective of the nature and purposes of the classification or the quality and extent of the difference in experience between candidates. As between someone with 18 years’ experience but aged 42 or 43 years, and someone with only 12 years’ experience, if a system of weightage for experience and qualification were to be applied, the one with greater experience would in all likelihood be selected. Then, to say that one with lesser experience, but who is more aged should be selected and appointed, not only eliminating the one with more experience, but even disqualifying her or him, would mean that better candidates have to be overlooked and those with lesser experience would be appointed, solely on the ground that the latter is over 50 years of age. [Para 27][877-D-G]

5.2. In the present case, the rule has the effect of excluding deserving candidates, without subserving any discernible public policy or goal. Thus, the classification is based on no justifiable rationale; nor can it be said that the age criterion has some nexus with the object sought to be achieved, such as greater efficiency or experience. [Para 27][878-B]

5.3. The qualification of a minimum age of 50 years as essential for appointment, is discriminatory because it is neither shown to have a rational nexus with the object sought to be achieved, i.e. appointing the most meritorious candidates; nor is it shown to be based on any empirical study or data that such older candidates fare better, or that younger candidates with more relevant experience would not be as good, as members of tribunals. It is plain and simple, discrimination based on age. The criterion (of minimum 50 years of age) is virtually “picked out from a hat” and wholly arbitrary. [Para 31][881-G-H; 882-A-B]

6.1. The tribunals which were reorganized by the Finance Act, 2017 and now, through the impugned ordinance, exercise judicial functions of the State, interpret and enforce the law, in the course of adjudication of disputes. The appointment of members (of such tribunals), their conditions of service, manner of selection, remuneration and security of tenure are vital to their efficiency and independent functioning. It is in this backdrop that the Union’s contention regarding “equivalence” or “parity” with members of the civil services of the Union or holders of civil posts under the Union, as a justification for the age criterion, needs to be examined. In addition, it is worthwhile to recollect that a civil servant’s experience, though varied and diverse – ranging from co-ordination and administration at taluk, district and state levels, to devising, framing and implementing the government’s policies and programmes, to managing statutory corporations and even commercial enterprises of the state, does not always entail adjudicatory functions. However, legal practitioners, chartered accountants and one segment of civil servants, i.e. tax administrators and adjudicators are involved in the day to day interpretation of law, leading to adjudicatory outcomes. Such being the case, the equivalence of “status” of members of tribunals cannot be compared in a linear or rigid manner. That according to the Union’s scheme of rules and regulations, members of its services can attain a certain rank upon attaining the age of, say, 50 years, therefore, cannot be determinative. In any case, the argument of equivalence is not relevant. This point too, was brought home in the judgment of this court, in All India Judges Association II. [Paras 32, 34][882B-D; 884-A-D]

6.2. There are other points of distinction too between civil servants and members of tribunals. Members of tribunals are not drawn from any civil service; they are not holders of civil posts. Civil servants, especially members of the All-India Services recruited by the Union, some of whom are deployed to different States, are governed by rules and other service conditions embodied in circulars and orders. These govern their entire universe of employment: starting with eligibility conditions, rules for recruitment and selection, pay and allowances, seniority, promotion, discipline and other matters related to misconduct, pension, terminal benefits etc. On the other hand, such rules or similar rules do not apply to members of tribunals not drawn from public service. It is only conditions of equivalence such as pay scale which they are assured of under the rules, which also determine their status. The manner of selection, conditions of eligibility, rules for their removal upon proven misbehaviour and so on, are entirely different from public servants. In fact, the latter category, i.e. members of tribunals not drawn from public service sources, are not even holders of civil posts or members of any encadred civil service. They are not governed by Article 311 of the Constitution, nor are their conditions of service laid out in rules framed under the proviso to Article 309 of the Constitution. Such being the position, the argument of parity, in the opinion of the Court, is entirely devoid of merit. Nor is the argument of the Attorney General that a uniform age is necessary, merited. There is no material to show that members recruited on the technical side, such as experts in engineering, scientific or other technical fields would be suitable only after they cross the age of 50. The Union’s argument that 50 years is necessary as it brings about parity between the members of the civil services who are eligible to be considered in their stream for tribunals or that there is an overall uniformity, is without merit and accordingly rejected. [Para 35][884-F-H; 885-A-C; 886-F]

7. The proviso to Section 184 (1), inserted by the impugned ordinance is declared void. A declaration is issued that all candidates, otherwise eligible on their merit, based on qualifications and experience in the relevant field, are entitled to be considered, without reference to the impugned “minimum” age (of 50 years) criteria. [Para 38][888-C]

8. The interim directions of this court, which culminated and were subsumed in Roger Mathew, resulted in the appointment of members of various tribunals, whose term is now sought to be interdicted by the proviso to Section 184 (11), which has been introduced with retrospective effect. While the retrospectivity accorded to this provision cannot be faulted, nevertheless, the said proviso, to the extent it seeks to interfere with and curtail the tenure of members appointed under interim orders, who are entitled to enjoy their term of office, in accordance with the preamended legislation and rules, is arbitrary and void. [Para 41][890D-F]

9. The curtailment of tenure to five years, of the few individuals appointed as members of tribunals, who were entitled to continue in office in terms of the pre-existing enactments (upto the age of 62 years etc.) is arbitrary. Apart from the fact that the Union wishes to curtail their tenure despite the finality of directions of this court in Roger Mathew and MBA-III, there is no conceivable rationale. Nor has any overriding public interest been espoused as a justification for this. The divesting of judicial office by legislative fiat, in this court’s opinion, directly affects the independence of the judiciary. It also amounts to naked discrimination, because all other members of the same tribunals would enjoy longer tenure, in terms of the pre-existing conditions of service, which prevailed at the time of their appointment. [Para 42][892-B-E]

10. It is concluded and held as follows:

(i) The first proviso to Section 184(1) of the Finance Act, 2017, introduced by Section 12 of the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 is hereby declared void and inoperative. Similarly, the second proviso to Section 184(1) of the Finance Act, 2017, introduced by Section 12 of the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 is held to be void and inoperative.

(ii) Section 184(7) of the Finance Act, 2017 introduced by Section 12 of the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 is hereby declared void and inoperative.

(iii) Section 184(11)(i) and (ii) introduced by Section 12 of the Tribunals (Reforms Rationalisation and Conditions of Service) Ordinance, 2021 are hereby declared as void and unconstitutional.

(iv) Consequently, the declaration of this Court in para 53(iv) of MBA-III shall prevail and the term of Chairperson of a Tribunal shall be five years or till she or he attains the age of 70 years, whichever is earlier and the term of Member of a Tribunal shall be five years or till she or he attains the age of 67 years, whichever is earlier.

(v) The retrospectivity given to the proviso to Section 184(11) – introduced by Section 12 of the Tribunals (Reforms Rationalisation and Conditions of Service) Ordinance, 2021 is hereby upheld; however, without in any manner affecting the appointments made to the post of Chairperson or members of various Tribunals, upto 04.04.2021. In other words, the retrospectivity of the provision shall not in any manner affect the tenures of the incumbents appointed as a consequence of this Court’s various orders during the interregnum period. [Para 46][894-F-G; 895-A-E]

State of Gujarat v. Raman Lal Keshav Lal Soni (1983)

2 SCC 33 : [1983] 2 SCR 287 – followed.

State of J&K v. Triloki Nath Khosa (1974) 1 SCC 19 : [1974] 1 SCR 771; Mohd. Shujat Ali v. Union of India (1975) 3 SCC 76 : [1975] 1 SCR 449; Anuj Garg v. Hotel Assn. of India (2008) 3 SCC 1 : [2007] 12 SCR 991 and All India Judges’ Assn. (II) v. Union of India (1993) 4 SCC 288 : [1993] 1 Suppl. SCR 749 – relied on.

Union of India v. R. Gandhi, President, Madras Bar Association (2010) 11 SCC 1 : [2010] 6 SCR 857; Madras Bar Association v. Union of India (2014) 10 SCC 1 : [2014] 10 SCR 1; Roger Mathew (2020) 6 SCC 1 : [2019] 16 SCR 1; Madras Bar Association v Union of India (2020) SCC Online (SC) 962 (MBAIII); Dr. D.C. Wadhwa & Ors. v. State of Bihar & Ors. [1987] 1 SCR 198; Krishna Kumar Singh v. State of Bihar (2017) 3 SCC 1 : [2017] 5 SCR 160;

Kesavananda Bharati v. State of Kerala [1973] 1 Suppl. SCR; L. Chandra Kumar v Union of India (1997) 3 SCC 261 : [1997] 2 SCR 1186; Ismail Faruqui v. Union of India (1994) 6 SCC 360 : [1994] 5 Suppl. SCR 1; Pareena Swarup v. Union of India (2008) 14 SCC 107 : [2008] 13 SCR 1217; S.P. Sampath Kumar v. Union of India & Ors. (1987) SCC Suppl. 734 : [1987] 3 SCR 233; Madras Bar Association (2015) 8 SCC 583 : [2015] 6 SCR 638; R.K. Jain v. Union of India [1993]

3 SCR 802; Chandra Mohan v. State of U.P [1967] 1 SCR 77; Chandramouleshwar Prasad v. Patna High Court (1969) 3 SCC 56 : [1970] 2 SCR 666; State of Kerala v. A. Lakshmikutty and Ors. [1987] 1 SCR 136; State of Bihar v. Bal Mukund Sah (2004) 4 SCC 640; Lt. Col. Nitisha & Ors. v. Union of India (2021) SCC OnLine SC 261; Commissioner, M.C.D. v. Shashi (2009)

165 DLT 17 and P. Venugopal v. Union of India (2008)

5 SCC 1 : [2008] 8 SCR 1 – referred to.

Liyanage v. The Queen [1967] 1 AC 259, 287–288; Smith v. City of Jackson 544 US 228 (2005) and Baab v. Wilke No. 18-882, 589 U. S. – referred to. Per Hemant Gupta, J. (Partly dissenting)

1. The views expressed in the detailed judgment authored by Justice L. Nageswara Rao as also separate but concurring judgment of Justice Ravindra Bhat, are not agreed with, except to the limited extent that part of Section 187(7) of the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 that the Search and Selection Committee shall recommend two names for a post and that the tenure of members including Chairperson etc. shall be four years in terms of Clauses

(i) and (ii) of Section 184 (11) of the Ordinance is illegal since the issues of constitution of panel and tenure have already been decided in MBA-III case and that without removing such defect, the Ordinance could not be enacted. [Para 1][895-F-H]

2. The judiciary in exercise of power of judicial review can strike down any legislation which violates fundamental rights or if it is beyond the legislative competence but the courts cannot direct the legislature to frame or enact a law and in a particular manner. The law declared by the Supreme Court is binding on all Courts in India in terms of Article 141 of the Constitution. The directions issued under Article 142 of the Constitution, are binding on every Court in terms of Article 141 of the Constitution. The legislature cannot be said to be Court within the meaning of Article 141 of the Constitution by any stretch of imagination. The directions of this Court stop outside the four walls of legislature. The judiciary will step in only after a law is enacted to test the legality of a statute on the known principles of judicial review. The Judiciary cannot and should not usurp the powers vested with legislature. The Judiciary cannot legislate in the scheme of the constitution. The directions of this Court in MBA-III case are encroaching upon the field reserved for legislature. [Para 13][900-E-G; 901-A-C]

3. The Court will not direct to the State or Union to enact any particular law, or amend/ issue any notification for amendment of any statutory Rule or even to direct an Act to be enforced, when the legislature has conferred such power on the executive. The directions of this Court in MBA-III case were issued in the peculiar facts to make the Tribunal functional at the earliest rather than mandating legislature to amend the law in a particular manner. The legislature has a right to enact law, which may not be necessarily in terms of the directions of this Court. Such law when enacted by Parliament or the State Legislature, even if contrary to the directions or guidelines issued by the Court, cannot be struck down for the said reason. Though transgression of constitutional limitations and intrusion into the judicial power by the legislature is violative of the principle of separation of powers, the rule of law and of Article 14 of the Constitution of India, but it is equally true that judiciary in exercise of power of judicial review cannot direct legislature to frame any law in a particular manner. [Paras 20, 29][904-A-C; 909-E]

4. It cannot be said that the first proviso to Section 184 prescribing a minimum age of fifty years is an attempt to circumvent the direction issued in MBA-III case. The condition of eligibility for appointment as a Judge of a High Court was kept in view while considering the eligibility of advocates as members of Tribunals. However, the Memorandum of Procedure for appointment as judges of the High Court finalized by this Court and forwarded to the Central Government in March, 2017 was that a person shall not be eligible to be considered for appointment as Judge of a High Court against Bar quota unless he has completed forty-five years of age on the date of recommendation by the High Court Collegium. Though, in terms of Article 217 of the Constitution, a candidate becomes eligible for appointment after 10 years of practice as an Advocate. Thus, an Advocate would be eligible for appointment as judge of the High Court around the age of 35 years. The Memorandum of Procedure adopted by the Collegium of this Court prescribed forty-five years of age as the minimum age. The eligibility to seek appointment is not solely dependent upon qualification of a candidate but experience and suitability, likely term which a candidate may have are necessary considerations. [Para 31][909-G-H; 910-A-D]

5. In terms of the Constitution read with the Memorandum of Procedure adopted by this Court, an advocate would have maximum tenure of 17 years as a Judge of the High Court, may be another three years as Judge of this Court. On the other hand, an advocate appointed as member of a Tribunal can have a tenure of 17 years, even if 50 is the minimum age for appointment. The tenure of such member is up to the age of 67 years with the possibility of being appointed as the Chairperson. This is not to compare the status of a High Court Judge with that of a member of a Tribunal. The members would be appointed on the basis of recommendation of the high-powered Search and Selection Committee having judicial dominance. If a member is discharging his functions legally, there is no need to bear any apprehension about his not being re-appointed. The process of re-appointment is again with the High-Powered Search and Selection Committee with judicial dominance. A provision in the statute cannot be found to be untenable merely for the reason that there is a possibility of not being re-appointed. [Para 32][910-E-G]

6. The advocates were not eligible for appointment under 2020 Rules. Therefore, there was no condition of age of eligibility of such candidates. The discussions in the judgment are not to be considered as directions. There is background in which the ultimate directions are issued. Since no directions were issued in respect of eligibility conditions particularly relating to age, thus, fixing of eligible age as fifty years cannot be treated to be in contradiction to the directions issued in MBA-III case. Even if it is contravening to any such direction, the legislature is within its jurisdiction to determine the minimum eligibility age for the purpose of appointment. [Paras 33, 34][910-H; 911-A-C]

7. The age of 50 years as the eligibility condition is not off the hat but is based upon previous legislation in respect of members of the National Company Law Tribunal. Thus, the fixation of fifty years of age as the eligibility condition cannot be said to be manifestly arbitrary or violative of any of the Fundamental Rights of any of the candidates which may render such condition of age as illegal. The argument is based on apprehension that it would be difficult for an advocate appointed after attaining the age of fifty years to resume legal practice after completion of one term, in case he is not reappointed. A person who is competent and good in his work will not find any difficulty to resume his practice but what would happen to his professional career if his term is not extended is a calculated risk which a candidate shall take at the time of seeking appointment. Such apprehensions as to what will happen in future cannot be a ground to strike down a condition of age in the statute. This Court is not possessed of the expertise to say that it will be difficult for an advocate to resume practice if he is not reappointed. The statutory provisions cannot be struck down on such grounds based on presumed apprehensions. [Para 40][913-E-H; 914-A]

8. The apprehensions or misuse of a statutory provision is not a ground to declare the provisions of a statute as void. In case of failing to secure reappointment, the candidate will not be able to resume practice is based upon apprehensions. Whether they are good or valid grounds to refuse reappointment can be subject matter of judicial review although the decision of the highpower Search and Selection Committee not to re-appoint a candidate may not warrant interference in exercise of judicial review. [Paras 41, 43][914-A-B; 915-D-E]

9. The second proviso is to the effect that allowances and benefits shall be to the extent as are admissible to a Central Government officer holding the post carrying the same pay. The third proviso to Section 184(1) is that where Chairperson or Members take a house on rent, he may be reimbursed a house rent subject to such limits and conditions as may be prescribed. In terms of third proviso, the Tribunal, Appellate Tribunal and other Authorities (Qualifications, Experience and other Conditions of Service of Members) (Amendment) Rules, 2021 have been published. As per the Rules now notified, the Chairman, Chairperson, President, Vice Chairman, Vice Chairperson or Vice President shall have option to avail of accommodation to be provided by the Central Government as per the rules for the time being in force or entitled to house rent allowance subject to a limit of Rs. one lakh fifty thousand rupees per month and the Members shall have option to avail of accommodation to be provided by the Central Government as per the rules for the time being in force or entitled to house rent allowance subject to a limit of Rs.one lakh twenty-five thousand rupees per month with effect from the 1st January, 2021. Therefore, the directions issued stands complied with. [Para 45][916-A-D]

10. The direction of this Court was that the Union shall make appointments to Tribunals within three months whereas the Ordinance has used the expression that the Central Government shall take a decision on the recommendations of the Committee “preferably within three months”. Both the directions are only directory. It is well-settled that the use of expression ‘shall’ or ‘may’ is not determinative of the fact that whether the condition is mandatory or directory. Therefore, there is no reason to set aside the expression ‘preferably’ used in subsection (7) of Section 184. Such directions were issued in terms of Article 142 of the Constitution which stop at the four walls of the Parliament. The language to be used falls within the legislative competence and do not violate any fundamental right nor can be said to be manifestly arbitrary. [Para 47][916-G-H; 917-A-B]

11. The inserted proviso to Section 184(11) by the Ordinance deals with two situations. One is in respect of the candidates appointed from 26.5.2017 till the notified date that is 4.4.2021 in terms of sub-Section (11) of Section 184. Second is in respect of the candidates who have not been appointed falling within proviso to sub-Section (1) of Section 184, which provides that a person who has not completed the age of fifty years shall not be eligible for appointment as a Chairperson or Member. There is no doubt that this is a prospective provision as no candidate who has not completed 50 years of age is eligible to seek appointment. There is no merit in the argument that a selected candidate has a right to seek appointment and that too within three months of the order of this Court. Firstly, a selected candidate has no right to seek appointment. The successful candidates do not acquire an indefeasible right to be appointed which cannot be legitimately denied. The fact that the legislation has intervened to prescribe a particular age which is at variance with the condition in the advertisement is a good reason not to appoint the candidates. The legality of Sections 174, 175 and 184 of the Finance Act, 2017 has been upheld in the matter of Rojer Mathew. Therefore, after such an amendment, appointments can be made only in terms of the Rules famed under Section 184 of the Finance Act. Now, some of the Rules stand substituted by the Ordinance. Therefore, candidates who have not been appointed will have to seek appointment only in terms of the substituted Section 184 of the Finance Act. The candidates who were selected cannot seek appointment on the basis of their old selection and being in merit. [Paras 54, 55, 56][921-G-H; 922-AC; F-H]

12.1. Some of the Chairpersons and Members of the Tribunals were appointed between 26.5.2017 to 4.4.2021 in terms of the interim orders passed by this Court. The interim order which permitted the appointments now stands subsumed in the Ordinance which has defined the tenure and the terms and conditions of appointment. The Ordinance is in fact in terms of the liberty granted to Union to seek modification. Mere fact that an application for modification is pending will not bar the legislature to enact a statute by way of an Ordinance. The appointments made after 26.5.2017 by virtue of Section 184(11) will be governed not by the parent statute but by the terms and conditions as enumerated in the Ordinance. The consent of the Attorney General will not act as an estoppel against the statute i.e. the Ordinance. [Paras 57, 58][923-A, D-E]

12.2. The candidates in question were appointed during the pendency of lis. These appointments were not concluded appointments but were subject to the provisions of the parent Act which has been amended by the Finance Act, 2017. They cannot claim any right to continue on the post till the age of retirement under the parent Act in terms of proviso to sub-section

(11) of Section 184 of the Finance Act as substituted. The provisions of the parent Act cease to be in existence with the order passed in Rojer Mathew and subsequent legislative enactments introduced by way of the Ordinance. [Para 62][925D-F]

13.1. The first, second and third proviso to Section 184(1), the use of expression ‘preferably’ in Section 184(7) and the proviso to Section 184(11) are legal and valid as such provisions fall within the exclusive domain of the legislature. The legislature has not nullified the judgment of this Court on the above aspects as there were no such corresponding provisions in the 2020 Rules, which were part of judicial review process. [Para 63][925-F-G]

13.2. It is open to the legislature to fix tenure of the Chairperson and the members other than four years as the tenure of four years was found to be not tenable in MBA-III. Section 184(7) which contemplates that Select Committee should recommend a panel of two names is contrary to the directions of this Court in MBA-III. Thus, Section 184(11)(i)(ii) and Section 184(7) is declared to be void as the Ordinance has reiterated the provisions which were in 2020 Rules. The challenge to other provisions is not legally sustainable. [Para 64][925-G-H; 926-A]

S.R. Bhagwat & Ors. v. State of Mysore (1995) 6 SCC

16 : [1995] 3 Suppl. SCR 545; Cauvery Water Disputes Tribunal (1983) 1 Suppl. SCC 96 : [1991] 2 Suppl. SCR 497; Medical Council of India v. State of Kerala & Ors. (2019) 13 SCC 185 : [2018] 10 SCR 213 and Virender Singh Hooda & Ors. v. State of Haryana & Anr. (2004) 12 SCC 588 : [2004] 5 Suppl. SCR 720 – distinguished.

P. Ramachandra Rao v. State of Karnataka (2002) 4 SCC 578; A.K. Roy v. Union of India & Ors., (1982) 1 SCC 271 : [1982] 2 SCR 272; Kalpana Mehta & Ors, v. Union of India & Ors. (2018) 7 SCC 1 : [2018] 4 SCR 1; Powers, Privileges and Immunities of State Legislatures, AIR 1965 SC 745; Padma Sundara Rao (Dead) & Ors. v. State of T.N. & Ors., (2002) 3 SCC

533 : [2002] 2 SCR 383 and Natural Resources Allocation, in Re, Special Reference No. 1 of 2012 – followed.

Dr. Ashwani Kumar v. Union of India & Anr. (2020) 13 SCC 585 : [2019] 12 SCR 30; Mangalam Organics Limited v. Union of India, (2017) 7 SCC 221 : [2017] 5 SCR 406; State of Orissa & Ors. v. Md. Illiyas (2006)

1 SCC 275 : [2005] 5 Suppl. SCR 395; Union of India v. Amrit Lal Manchanda & Anr., (2004) 3 SCC 75 : [2004] 2 SCR 422; Som Mittal v. Government of Karnataka, (2008) 3 SCC 574 : [2008] 3 SCR 130; Arasmeta Captive Power Company Private Limited & Anr. v. Lafarge India Private Limited, (2013) 15 SCC

414 : [2013] 17 SCR 496; Shanti Bhushan v. Supreme Court of India & Anr., (2018) 8 SCC 396 : [2018] 12 SCR 972 and M.C. Mehta v. Kamal Nath & Ors., (2000)

6 SCC 213 : [2000] 1 Suppl. SCR 389 – relied on. Union of India v. R. Gandhi, President, Madras Bar Association (2010) 11 SCC 1 : [2010] 6 SCR 857; Rojer Mathew v. South Indian Bank Limited & Ors. (2020) 6 SCC 1 : [2019] 16 SCR 1; Madras Bar Association v. Union of India & Anr. (2020) SCC Online SC 962; Madras Bar Association v. Union of India & Anr. (2015)

8 SCC 583 : [2015] 6 SCR 638; Collector of Customs, Madras & Anr. v. Nathella Sampathu Chetty & Anr. AIR 1962 SC 316 : [1962] 3 SCR 786; Government of Andhra Pradesh & Anr. v. G. Jaya Prasad Rao & Ors., (2007) 11 SCC 528 : [2007] 4 SCR 256; People’s Union for Civil Liberties & Anr. v. Union of India (2004) 9 SCC 580 : [2003] 6 Suppl. SCR 860; Charan Lal Sahu v. Union of India, (1990) 1 SCC 613 : [1989] 2 Suppl. SCR 597; Mehmood Alam Tariq & Ors. v. State of Rajasthan & Ors. (1988) 3 SCC 241 : [1988] 1 Suppl. SCR 379; Shri Prithvi Cotton Mills Ltd. & Anr. v. Broach Borough Municipality & Ors. (1969) 2 SCC 283 : [1970] 1 SCR 388; Madan Mohan Pathak & Anr. v. Union of India & Ors., (1978) 2 SCC 50 : [1978] 3 SCR 334; S.S. Bola & Ors. v. B.D. Sardana & Ors. (1997) 8 SCC 522 : [1997] 2 Suppl. SCR 507; B.K. Pavitra v. Union of India (2019) 16 SCC 129 : [2019]

7 SCR 1086; State of Tamil Nadu v. State of Kerala (2014) 12 SCC 696 : [2014] 12 SCR 875; Mullaperiyar Environmental Protection Forum v. Union of India, (2006) 3 SCC 643 : [2006] 2 SCR 740 and Shankarsan Dash v. Union of India (1991) 3 SCC 47 : [1991] 2 SCR 567 – referred to.