The Secretary Ministry of Consumer Affairs vs Dr. Mahindra Bhaskar Limaye & Ors.

Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of President and Members of State Commission and District Commission) Rules, 2020 – r.6(9) – Held: Under r.6(9), the Selection Committee is empowered with uncontrolled discretionary power to determine its procedure to recommend candidates to be appointed as President and Members of the State and District Commission – Transparency and selection criteria are absent – While making the appointment as Members of the District Fora, State Commission there is a need to assess the skill, ability, and competency of the candidates before they are empanelled and recommended to the State Government – 2020 Rules do not contemplate written examination to test the merits of the candidate – Written examination which was confirmed by the Supreme Court has been removed under the new 2020 Rules – No justification shown to do away with it – Consumer Protection Act, 2019 – Consumer Protection Act, 1986 – Consumer Protection (Appointment, Salary, Allowance and Conditions of Service of President and Members of State Commission and District Forum) Rules, 2017. Tribunals – Quasi-judicial authorities, standards expected from the members – Held: Commissions are quasi-judicial authorities, therefore, the standards expected from the members of the tribunal should be as nearly as possible as applicable to the appointment of judges exercising such powers – Consumer Protection Act, 2019 – Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of President and Members of State Commission and District Commission) Rules, 2020 – Consumer Protection Act, 1986 – Consumer Protection (Appointment, Salary, Allowance and Conditions of Service of President and Members of State Commission and District Forum) Rules, 2017.

Disposing of the appeals, the Court

HELD: 1.1 The High Court in the impugned judgment and order has rightly observed and held that Rule 3(2)(b), Rule 4(2)(c) and Rule 6(9) of the Rules, 2020 which are contrary to the decisions of this Court in the cases of State of Uttar Pradesh and Others Vs. All Uttar Pradesh Consumer Protection Bar Association (UPCPBA) and the Madras Bar Association are unconstitutional and arbitrary. Even otherwise Rule 6(9) lacks transparency and it confers uncontrolled discretion and excessive power to the Selection Committee. Under Rule 6(9), the Selection Committee is empowered with the uncontrolled discretionary power to determine its procedure to recommend candidates to be appointed as President and Members of the State and District Commission. The transparency and selection criteria are absent under Rule 6(9). In absence of transparency in the matter of appointments of President and Members and in absence of any criteria on merits the undeserving and unqualified persons may get appointment which may frustrate the object and purpose of the Consumer Protection Act. It cannot be disputed that the Commissions are empowered with the powers of court and are quasi-judicial authorities and empowered to discharge judicial powers with the adequate powers of the court including civil and criminal. Therefore, the standards expected from the members of the tribunal should be as nearly as possible as applicable to the appointment of judges exercising such powers. Under Rule 6(9) of Rules, 2020, the Selection Committee is having power to determine its own procedure. Such provisions are also giving excessive and uncontrolled discretionary powers to the Selection Committee. As rightly observed and held by the High Court, considering the object on behalf of the Consumer Protection Act, 2019, such uncontrolled discretion power to determine its procedure for making its recommendation for appointment of President and Members of the District and the State Commissions is arbitrary and unreasonable. It is always desirable that while making the appointment as Members of the District Fora and/or the State Commission there is a need to assess the skill, ability, and the competency of the candidates before they are empanelled and recommended to the State Government. The Rules, 2020 do not contemplate written examination so as to test the merits of the candidate. In the case of UPCPBA, this Court expressed deep concern over the bureaucratic and political interference in process of appointments. [Paras 6.4, 6.5][319-E, H; 320-A-D]

Madras Bar Association v. Union of India and Another (2021) 7 SCC 369 : [2020] 2 SCR 246; State of Uttar Pradesh and Others v. All Uttar Pradesh Consumer Protection Bar Association (2017) 1 SCC 444 : [2016]

8 SCR 851 – relied on.

1.2 Mechanism of having written examination was confirmed by this Court which has been removed under the new Rules, 2020. Earlier under Consumer Protection Act, 1986, there were Rules, 2017 in so far as some of the States are concerned and Rules, 2019 so far as the State of Maharashtra is concerned, which provided for a written examination and viva voce, which was under the Consumer Protection Act, 1986. The Consumer Protection Act, 1986 has been repealed and the Consumer Protection Act, 2019 has come into force w.e.f. 24.07.2020 with a sole intention to provide adequate safeguards to the consumers and the pecuniary jurisdiction of the District Fora and State Commissions are enhanced substantially. However, there is no substantial change in the scheme with respect to the adjudication of the consumer disputes. No justification at all is shown to do away with the written examination while framing the Rules, 2020 under the Consumer Protection Act, 2019. Therefore, as rightly observed by the High Court, the Rule 6(9) of the Rules, 2020 is unconstitutional, arbitrary and violative of Article 14 of the Constitution of India, more particularly, when the same is wholly impermissible to override/overrule the earlier decisions of this Court and that too without any justification. This Court is in complete agreement with the view taken by the High Court. [Paras 6.6-6.8][320-E-H; 321-A]

1.3 Under provision 4(1) of Rules, 2020, a person who is eligible to be appointed as a district judge (having minimum experience of 7 years) is qualified to be appointed as President of the District Commission but in order to be appointed as a Member, Rule 4(2)(c) mandates a minimum experience of 15 years which is rightly held to be violative of Article 14 of the Constitution. Similarly providing 20 years’ experience under Rule 3(2)(b) also rightly held to be arbitrary and violative of Article 14 of the Constitution. Even under Rule 3(1) a judge of the High Court, present or former, shall be qualified for appointment of the President. As per Article 233 of the Constitution, a lawyer needs to have only 7 years of practice as an advocate in High Court. Under the circumstances to provide 20 years’ experience under Rule 3(2)(b) is rightly held to be unconstitutional, arbitrary and violative of the Article 14 of the Constitution of India. This Court is in complete agreement with the view taken by the High Court. In the case of Madras Bar Association– MBA III, this Court directed to consider 10 years’ experience, after detail reasoning. [Paras 7.1, 7.2][321-C-F]

Madras Bar Association v. Union of India & Anr.- MBA III (2017) 7 SCC 369 – relied on.

1.4 There is no reason to interfere with the impugned judgment and order passed by the High Court declaring Rule 3(2)(b), Rule 4(2)(c) and Rule 6(9) of the Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of President and Members of State Commission and District Commission) Rules, 2020 as arbitrary, unreasonable and violative of Article 14 of the Constitution of India. The Central Government and the concerned State Governments have to amend Rules, 2020, more particularly, Rule 6(9) of the Rules, 2020, providing that the Selection Committee shall follow the procedure for appointment as per Model Rules, 2017 and to make the appointment of President and Members of the State Commission and the District Commission on the basis of the performance in written test consisting of two papers of 100 marks each and 50 marks for viva voce and the written test consisting of two papers may be as per the schemes enumerated. The Central Government and the concerned State Governments have also to come with an amendment in the Rules, 2020 to provide 10 years’ experience to become eligible for appointment of President and Member of the State Commission as well as the District Commission instead of 20 years and 15 years respectively, provided in Rule 3(2)(b) and Rule 4(2)(c) which has been struck down to the extent providing 20 years and 15 years of experience, respectively. Till the suitable amendments are made in Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of President and Members of State Commission and District Commission) Rules, 2020 as above, in exercise of powers under Article 142 of the Constitution of India and to do complete justice, it is directed that in future and hereinafter, a person having bachelor’s degree from a recognized University and who is a person of ability, integrity and standing, and having special knowledge and professional experience of not less than 10 years in consumer affairs, law, public affairs, administration, economics, commerce, industry, finance, management, engineering, technology, public health or medicine, shall be treated as qualified for appointment of President and Members of the State Commission. Similarly, a person of a person of ability, integrity and standing, and having special knowledge and professional experience of not less than 10 years in consumer affairs, law, public affairs, administration, economics, commerce, industry, finance, management, engineering, technology, public health or medicine, shall be treated as qualified for appointment of President and Members of the District Commissions. It is also directed under Article 142 of the Constitution of India that for appointment of President and Members of the State Commission and District Commission, the appointment shall be made on the basis of performance in written test consisting of two papers as per the scheme enumerated. The qualifying marks in each paper shall be 50 per cent and there shall be viva voce of 50 marks. [Paras 8, 8.1, 8.3][321-G-H; 322-A-B, F-H; 323-A-C, G]

Madras Bar Association v. Union of India & Anr. 2021 SCC OnLine SC 463; State of Uttar Pradesh v. All Uttar Pradesh Consumer Protection Bar Association (2018)

7 SCC 423 : [2018] 4 SCR 503 – referred to.