Madras Bar Association vs Union of India & Anr.

Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – rr.9(1) and 9(2) – Term of office of the Chairpersons, vice-chairpersons and the members of the Tribunal – Modification of the Rules, 2020 – Held: In view of the law laid down in the earlier judgments of the Supreme Court, the modification of the tenure is directed in rr. 9(1) and 9(2) of the 2020 Rules as five years in respect of Chairman or Chairperson, Vice Chairman or Vice-Chairperson and the members – The Government to amend r. 9 (1) of the 2020 Rules by making the term of Chairman, Chairperson or President as five years or till they attain 70 years, whichever is earlier and other members dealt with in r. 9(2) as five years or till they attain 67 years, whichever is earlier. Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – r. 15 – House Rent Allowance to the Chairperson and other members of the Tribunals – The lack of housing in Delhi has been one of the reasons for retired judges of the High Courts and the Supreme Court to not accept appointments to Tribunals – Held: The Government of India directed to make serious efforts to provide suitable housing to the Chairperson and the members of the Tribunals and in case providing housing is not possible, to enhance the house rent allowance to Rs.1,25,000/- for members of Tribunals and Rs.1,50,000/- for the Chairman or Chairperson or President and Vice Chairman or Vice Chairperson or Vice President of Tribunals – In other words, an option should be given to the Chairperson and the members of the Tribunals to either apply for housing accommodation to be provided by the Government of India as per the existing rules or to accept the enhanced house rent allowance.

Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – Advocates as Judicial members – Held: An Advocate of a High Court with experience of ten years is qualified for appointment as a Judge of the High Court as per Art.

217 (2) of the Constitution of India – As the qualification for an advocate of a High Court for appointment as a Judge of a High Court is only 10 years, thus, the experience at the bar should be on the same lines for being considered for appointment as a judicial member of a Tribunal – However, it is left open to the Search-cumSelection Committee to take into account experience of the Advocates at the bar and the specialization of the Advocates in the relevant branch of law while considering them for appointment as judicial members.

Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – Members of Indian Legal Service – Eligibility of – Held: The members of Indian Legal Service are entitled to be appointed only as technical members – The members of Indian Legal Service shall be entitled to be considered for appointment as a judicial member subject to their fulfilling the other criteria which advocates are subjected to – In addition, the nature of work done by the members of the Indian Legal Service and their specialization in the relevant branches of law shall be considered by the Search-cum-Selection Committee while evaluating their candidature.

Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – Removal of members – r. 8 – Held: r. 8 of the 2020 Rules shall be amended to reflect that the recommendations of the Search-cum-Selection Committee in matters of disciplinary actions shall be final and the recommendations of the Search-cumSelection Committee shall be implemented by the Central Government.

Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – Time Limit for appointment – Held: The pendency of cases in the Tribunals is increasing mainly due to the lack of personnel in the Tribunals which is due to the delay in filling up the vacancies as and when they arise due to the retirement of the members – There is an imminent need for expediting the process of selections and appointments to ensure speedy justice – The Government of India directed to make the appointments to the Tribunals within three months after the Search-cum-Selection Committee completes the selection and makes its recommendations.

Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 – Retrospectivity of the 2020 Rules – The Government of India contended that the new Rules, 2020 have been framed in exercise of powers under the Finance Act, 2017, the 2020 Rules would be effective from 26.05.2017 – Held: The 2020 Rules which came into force from the date of their publication in the Official Gazette, i.e. 12.02.2020, cannot be given retrospective effect – The intention of Government of India to make the 2020 Rules prospective is very clear from the notification dated 12.02.2020 – In any event, subordinate legislation cannot be given retrospective effect unless the parent statute specifically provides for the same – It is clarified that all appointments made prior to the 2020 Rules which came into force on 12.02.2020 shall be governed by the parent Acts and Rules – Any appointment made after the 2020 Rules have come into force shall be in accordance with the 2020 Rules subject to the modifications directed in the preceding paragraphs of this judgment.

Disposing of the writ petitions, Transfer Petitions, Civil Appeals, the Court

HELD: NATIONAL TRIBUNAL COMMISSION

1. The Union of India is directed to set up a National Tribunals Commission as suggested by this Court by its order dated 07.05.2018 at the earliest. Setting up of such a Commission would enhance the image of the Tribunals and instill confidence in the minds of the litigants. Dependence of the Tribunals for all their requirements on the parent Department will not extricate them from the control of the executive. Judicial independence of the Tribunals can be achieved only when the Tribunals are provided the necessary infrastructure and other facilities without having to lean on the shoulders of the executive. This can be achieved by establishment of an independent National Tribunals Commission as suggested above. To stop the dependence of the Tribunals on their parent Departments for routing their requirements and to ensure speedy administrative decision making, as an interregnum measure, there should also be a separate “tribunals wing” established in the Ministry of Finance, Government of India to take up, deal with and finalize requirements of all the Tribunals till the National Tribunals Commission is established. [Para 20][273-B-D] SEARCH-CUM-SELECTION COMMITTEE

2. There is merit in the submission of the Attorney General that the presence of the Secretary of the sponsoring or parent department in the Search-cum-Selection Committee will be beneficial to the selection process. But, it is settled that the Secretary of the parent or sponsoring Department cannot have a say in the process of selection and service conditions of the members of Tribunals. Ergo, the Secretary to the sponsoring or parent Department shall serve as the Member-Secretary/Convener to the Search-cum-Selection Committee and shall function in the Search-cum-Selection Committee without a vote. [Para 29][279-B-C]

3. The Government of India is duty bound to implement the directions issued in the earlier judgments and constitute the Search-cum-Selection Committees in which the Chief Justice of India or his nominee shall be the Chairperson along with the Chairperson of the Tribunal if he is a retired Judge of the Supreme Court or a retired Chief Justice of a High Court and two Secretaries to the Government of India. In case the Tribunal is headed by a Chairperson who is not a judicial member, the Searchcum-Selection Committee shall consist of the Chief Justice of India or his nominee as Chairperson and a retired Judge of the Supreme Court or a retired Chief Justice of a High Court to be nominated by the Chief Justice of India and Secretary to the Government of India from the Ministry of Law and Justice and a Secretary of a department other than the parent or sponsoring department to be nominated by the Cabinet Secretary. As stated above, the Secretary of the parent or sponsoring department shall serve as the Member-Secretary or Convener, without a vote. [Para 30][279-D-F]

4. Rule 4 (2) of the Tribunal, Appellate Tribunal and other Authorities [Qualification, Experience and other conditions of service of Members] Rules, 2020 postulates that a panel of two or three persons shall be recommended by the Search-cumSelection Committee from which the appointments to the posts of Chairperson or members of the Tribunal shall be made by the Central Government. The Amicus Curiae voiced serious objections to Rule 4(2) on the ground that it would be compromising judicial independence. According to Amicus Curie, the procedure for appointment to the Tribunals should be completely outside executive control. The Attorney General stated that a panel of names consisting two or three persons is essential because their antecedents have to be examined by the Intelligence Bureau before appointing them to a Tribunal. He suggested that the number of persons to be recommended can be two instead of three to limit the discretion of the Appointments Committee of the Cabinet. The recommendations for appointments by the Search-cum-Selection Committee should be final and the executive should not be permitted to exercise their discretion in the matter of appointments to the Tribunals. Accordingly, this Court directs that Rule 4(2) of the 2020 Rules shall be amended and till so amended, that it be read as empowering the Search-cum-Selection Committee to recommend the name of only one person for each post. However, taking note of the submissions made by the Attorney General regarding the requirement of the reports of the selected candidates from the Intelligence Bureau, another suitable person can be selected by the Search-cum-Selection Committee and placed in the waiting list. In case, the report of the Intelligence Bureau regarding the selected candidate is not satisfactory, then the candidate in the waiting list can be appointed. [Para 31][279-G-H; 280-A-D]

TERM OF OFFICE

5. The 2020 Rules are not in compliance with the principles of law laid down in Union of India v. Madras Bar Association (2010) and Rojer Mathew in respect of the tenure of the members of the Tribunals in spite of this Court repeatedly holding that short tenure of members is detrimental to the efficiency and independence of the Tribunals. Rule 9(1) of the 2020 Rules provide for a term of four years or till a Chairman or Chairperson or President attains the age of 70 years whichever is earlier. No rationale except that four years is more than three years prescribed in the 2017 Rules (described as too short, in Roger Mathew ) was put forward on behalf of the Union of India. In so far as the posts of Vice Chairman or Vice-Chairperson or VicePresident and members are concerned, Rule 9(2) fixes the tenure as four years or till they attain the age of 65 years whichever is earlier. In view of the law laid down in the earlier judgments of the Supreme Court, the modification of the tenure is directed in Rules 9(1) and 9(2) of the 2020 Rules as five years in respect of Chairman or Chairperson, Vice Chairman or Vice-Chairperson and the members. Rule 9(1) permits a Chairman, Chairperson or President of the Tribunal to continue till 70 years which is in conformity with Parliamentary mandate in Section 184 of the Finance Act. However, Rule 9(2) provides that Vice Chairman and other members shall hold office till they attain 65 years. This Court is in agreement with the submission made by the learned Amicus Curiae that under the 2020 Rules, the Vice Chairman, Vice-Chairperson or Vice-President or members in almost all the Tribunals will have only a short tenure of less than three years if the maximum age is 65 years. Therefore, the Government is directed to amend Rule 9 (1) of the 2020 Rules by making the term of Chairman, Chairperson or President as five years or till they attain 70 years, whichever is earlier and other members dealt with in Rule 9(2) as five years or till they attain 67 years, whichever is earlier. [Para 35][281-F-H; 282-A-D] HOUSE RENT ALLOWANCE

6. Experience has shown that lack of housing in Delhi has been one of the reasons for retired Judges of the High Courts and the Supreme Court to not accept appointments to Tribunals. At the same time, scarcity of housing is also a factor which needs to be kept in mind. The only way to find a solution to this problem is to direct the Government of India to make serious efforts to provide suitable housing to the Chairperson and the members of the Tribunals and in case providing housing is not possible, to enhance the house rent allowance to Rs.1,25,000/- for members of Tribunals and Rs.1,50,000/- for the Chairman or Chairperson or President and Vice Chairman or Vice Chairperson or Vice President of Tribunals. In other words, an option should be given to the Chairperson and the members of the Tribunals to either apply for housing accommodation to be provided by the Government of India as per the existing rules or to accept the enhanced house rent allowance. This direction shall be effective from 01.01.2021. [Para 38][283-D-E]

ADVOCATES AS JUDICIAL MEMBERS

7. In view of the submission of the Attorney General that the 2020 the Rules will be amended to make Advocates eligible for appointment to the post of judicial members of the Tribunals, the only question that remains is regarding their experience at the bar. While the Attorney General suggested that an advocate who has 25 years of experience should be considered for appointment as a Judicial member, the learned Amicus Curiae suggested that it should be 15 years. An Advocate of a High Court with experience of ten years is qualified for appointment as a Judge of the High Court as per Article 217 (2) of the Constitution of India. As the qualification for an advocate of a High Court for appointment as a Judge of a High Court is only 10 years, this Court is of the opinion that the experience at the bar should be on the same lines for being considered for appointment as a judicial member of a Tribunal. Exclusion of Advocates in 10 out of 19 tribunals, for consideration as judicial members, is therefore, contrary to Union of India v. Madras Bar Association (2010) and Madras Bar Association v. Union of India (2015). However, it is left open to the Search-cum-Selection Committee to take into account in the experience of the Advocates at the bar and the specialization of the Advocates in the relevant branch of law while considering them for appointment as judicial members. [Para 41][285-A-D]

ELIGIBILITY OF MEMBERS OF INDIAN LEGAL

SERVICE

8. As Advocates are entitled to be considered as judicial members of the Tribunals, there is no harm in members of the Indian Legal Service being considered as judicial members, provided they satisfy the criteria relating to the standing at the bar and specialization required. The judgment of Union of India v. Madras Bar Association (2010) did not take note of the above points relating to the experience of members of Indian Legal Service at the bar. The Indian Legal Service was considered along with the other civil services for the purpose of holding that the members of Indian Legal Service are entitled to be appointed only as technical members. In the light of the submission made by the Attorney General and the Amicus Curiae, this Court holds that the members of Indian Legal Service shall be entitled to be considered for appointment as a judicial member subject to their fulfilling the other criteria which advocates are subjected to. In addition, the nature of work done by the members of the Indian Legal Service and their specialization in the relevant branches of law shall be considered by the Search-cum-Selection Committee while evaluating their candidature. [Para 43][286-E-H] REMOVAL OF MEMBERS

9. Rule 8 of the 2020 Rules provides the procedure for inquiry of misbehavior or incapacity of a member. According to the said Rule, the preliminary scrutiny of the complaint is done by the Central Government. If the Central Government finds that there are reasonable grounds for conducting an inquiry into the allegations made against a member in the complaint, it shall make a reference to the Search-cum-Selection Committee which shall conduct an inquiry and submit the report to the Central Government. The Amicus Curiae argued that there is no clarity in the Rules as to whether the reports submitted by the Searchcum-Selection Committee are binding on the Central Government. According to Amicus Curiae, it is impermissible for the Central Government to further scrutinize the report of the Search-cum-Selection Committee which comprises of sitting and retired Judges. He submitted that the proper procedure to be followed in matters of complaints against the Presiding Officers and members of the Tribunals is that a preliminary scrutiny may be made by the Central Government and the report should be placed before the Search-cum-Selection Committee. It is open to the Search-cum-Selection Committee to accept or reject the preliminary scrutiny. In case the Search-cum-Selection Committee is of the opinion that the findings of the preliminary scrutiny are correct, then the Search-cum-Selection Committee should be entitled to proceed further to conduct an inquiry on its own, if it so choses. The findings of the Search-cum-Selection Committee shall be final and the action recommended by the Search-cumSelection Committee shall be implemented by the Central Government. [Para 45][287-G-H; 288-A-D]

TIME LIMIT FOR APPOINTMENT

10. It has been brought to notice that there are a large number of unfilled vacancies hampering the progress of the functioning of the Tribunals. The pendency of cases in the Tribunals is increasing mainly due to the lack of personnel in the Tribunals which is due to the delay in filling up the vacancies as and when they arise due to the retirement of the members. There is imminent need for expediting the process of selections and appointments to ensure speedy justice. The Government of India directed to make the appointments to the Tribunals within three months after the Search-cum-Selection Committee completes the selection and makes its recommendations. [Para 47][288-H; 289A-B] RETROSPECTIVITY OF THE 2020 RULES

11. The 2017 Rules have been declared as being contrary to the parent enactment and the principles envisaged in the Constitution and hence struck down by this Court in Rojer Mathew. The Central Government was directed to reformulate the Rules in conformity and in accordance with the principles delineated by this Court in its earlier judgment and the observations made in Rojer Mathew. The 2020 Rules are made in exercise of the power conferred under Section 184 of the Finance Act which came into force on their publication in the official Gazette as per Rule 1(2). The date of publication of the 2020 Rules is 12.02.2020. The submission of Attorney General that the 2020 Rules which replaced the 2017 Rules shall come into force with effect from 26.05.2017 which was the appointed day in accordance with the 2017 Rules, is not accepted. It is true that the 2017 Rules were brought into force from 26.05.2017 and Section 183 of the Finance Act provides for any appointment made after the appointed day shall be in accordance with the Rules made under Section 184 of the Finance Act, 2017. 2017 Rules which have come into force with effect from 26.05.2017 in accordance with Section 183 have been struck down by this Court. The 2020 Rules which came into force from the date of their publication in the Official Gazette, i.e. 12.02.2020, cannot be given retrospective effect. The intention of Government of India to make the 2020 Rules prospective is very clear from the notification dated 12.02.2020. In any event, subordinate legislation cannot be given retrospective effect unless the parent statute specifically provides for the same. [Para 51][290-H; 291-A-E]

12. The following directions were issued:

(i) The Union of India shall constitute a National Tribunals Commission which shall act as an independent body to supervise the appointments and functioning of Tribunals, as well as to conduct disciplinary proceedings against members of Tribunals and to take care of administrative and infrastructural needs of the Tribunals, in an appropriate manner. Till the National Tribunals Commission is constituted, a separate wing in the Ministry of Finance, Government of India shall be established to cater to the requirements of the Tribunals; (ii) Instead of the four-member Search-cum-Selection Committees provided for in Column (4) of the Schedule to the 2020 Rules with the Chief Justice of India or his nominee, outgoing or sitting Chairman or Chairperson or President of the Tribunal and two Secretaries to the Government of India, the Search-cum-Selection Committees should comprise of the following members: (a)The Chief Justice of India or his nominee—Chairperson (with a casting vote); (b) The outgoing Chairman or Chairperson or President of the Tribunal in case of appointment of the Chairman or Chairperson or President of the Tribunal (or) the sitting Chairman or Chairperson or President of the Tribunal in case of appointment of other members of the Tribunal (or) a retired Judge of the Supreme Court of India or a retired Chief Justice of a High Court in case the Chairman or Chairperson or President of the Tribunal is not a Judicial member or if the Chairman or Chairperson or President of the Tribunal is seeking re-appointment—member; (c) Secretary to the Ministry of Law and Justice, Government of India—member; (d) Secretary to the Government of India from a department other than the parent or sponsoring department, nominated by the Cabinet Secretary-—member; (e) Secretary to the sponsoring or parent Ministry or Department—Member Secretary/Convener (without a vote). Till amendments are carried out, the 2020 Rules shall be read in the manner indicated; (iii) Rule 4(2) of the 2020 Rules shall be amended to provide that the Search-cum-Selection Committee shall recommend the name of one person for appointment to each post instead of a panel of two or three persons for appointment to each post. Another name may be recommended to be included in the waiting list; (iv)The Chairpersons, ViceChairpersons and the members of the Tribunal shall hold office for a term of five years and shall be eligible for reappointment. Rule 9(2) of the 2020 Rules shall be amended to provide that the Vice-Chairman, Vice-Chairperson and Vice President and other members shall hold office till they attain the age of sixty-seven years; (v) The Union of India shall make serious efforts to provide suitable housing to the Chairman or Chairperson or President and other members of the Tribunals. If providing housing is not possible, the Union of India shall pay the Chairman or Chairperson or President and Vice-Chairman, Vice-Chairperson, Vice President of the Tribunals an amount of Rs. 1,50,000/- per month as house rent allowance and Rs. 1,25,000/- per month for other members of the Tribunals. This direction shall be effective from 01.01.2021; (vi) The 2020 Rules shall be amended to make advocates with an experience of at least 10 years eligible for appointment as judicial members in the Tribunals. While considering advocates for appointment as judicial members in the Tribunals, the Search-cum-Selection Committee shall take into account the experience of the Advocate at the bar and their specialization in the relevant branches of law. They shall be entitled for reappointment for at least one term by giving preference to the service rendered by them for the Tribunals;

(vii) The members of the Indian Legal Service shall be eligible for appointment as judicial members in the Tribunals, provided that they fulfil the criteria applicable to advocates subject to suitability to be assessed by the Search-cum-Selection Committee on the basis of their experience and knowledge in the specialized branch of law; (viii) Rule 8 of the 2020 Rules shall be amended to reflect that the recommendations of the Search-cum-Selection Committee in matters of disciplinary actions shall be final and the recommendations of the Search-cum-Selection Committee shall be implemented by the Central Government; (ix) The Union of India shall make appointments to Tribunals within three months from the date on which the Search-cum-Selection Committee completes the selection process and makes its recommendations;

(x) The 2020 Rules shall have prospective effect and will be applicable from 12.02.2020, as per Rule 1(2) of the 2020 Rules;

(xi) Appointments made prior to the 2017 Rules are governed by the parent Acts and Rules which established the concerned Tribunals. In view of the interim orders passed by the Court in Rojer Mathew, appointments made during the pendency of Rojer Mathew were also governed by the parent Acts and Rules. Any appointments that were made after the 2020 Rules came into force i.e. on or after 12.02.2020 shall be governed by the 2020 Rules subject to the modifications directed in the preceding paragraphs of this judgment; (xii) Appointments made under the 2020 Rules till the date of this judgment, shall not be considered invalid, insofar as they conformed to the recommendations of the Search-cum-Selection Committees in terms of the 2020 Rules. Such appointments are upheld, and shall not be called into question on the ground that the Search-cum-Selection Committees which recommended the appointment of Chairman, Chairperson, President or other members were in terms of the 2020 Rules, as they stood before the modifications directed in this judgment. They are, in other words, saved; (xiii) In case the Search-cumSelection Committees have made recommendations after conducting selections in accordance with the 2020 Rules, appointments shall be made within three months from today and shall not be subject matter of challenge on the ground that they are not in accord with this judgment; (xiv) The terms and conditions relating to salary, benefits, allowances, house rent allowance etc. shall be in accordance with the terms indicated in, and directed by this judgment;(xv) The Chairpersons, Vice Chairpersons and members of the Tribunals appointed prior to 12.02.2020 shall be governed by the parent statutes and Rules as per which they were appointed. The 2020 Rules shall be applicable with the modifications directed in the preceding paragraphs to those who were appointed after 12.02.2020. While reserving the matter for judgment on 09.10.2020, the term of the Chairpersons, Vice-Chairpersons and members of the Tribunals is extended till 31.12.2020. In view of the final judgment on the 2020 Rules, the retirements of the Chairpersons, ViceChairpersons and the members of the Tribunals shall be in accordance with the applicable Rules as mentioned above. [Para 53][292-B-H; 293-A-H; 294-A-H; 295-A-B]

L. Chandra Kumar v. Union of India (1997) 3 SCC 261: [1997] 2 SCR 1186; Rojer Mathew v. South Indian Bank Limited (2020) 6 SCC 1 – relied on.

S.P. Sampath Kumar v. Union of India (1987) 1 SCC

124 : [1987] 1 SCR 435; R.K. Jain v. Union of India (1993) 4 SCC 119 : [1993] 3 SCR 802; 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; Bidi Supply Co. v. Union of India [1956] SCR 267; Sundeep Kumar Bafna v. State of Maharashtra (2014)

16 SCC 623 : [2014] 4 SCR 486; Union of India v. Madras Bar Association (2010) 11 SCC 1 : [2010] 6 SCR 857; Madras Bar Association v. Union of India (2015) 8 SCC 583 : [2015] 6 SCR 638; Sri

Vijayalakshmi Rice Mills v. State of A.P. (1976) 3 SCC

37 : [1976] 3 SCR 775; ITO v. M.C. Ponnoose (1969)

2 SCC 351 : [1970] 1 SCR 678 – referred to.

Hinds v. R (1976) 1 All ER 353 (PC) – referred to.