Explained: The discord between Supreme Court and the Centre over tribunals, why it matters

The CJI, set to retire on November 23, also questioned the timing of the request. “If you want to keep it after (November) 24th, you tell us frankly,” he remarked. This followed a hearing last Monday, during which the CJI described the Centre’s last-minute plea to refer the matter to a larger five-judge bench as a “tactic” to avoid the bench of the CJI and Justice KV Chandran.

An ordinance, an Act and a challenge

The ongoing case has impacted tribunals across the country. Tribunals are quasi-judicial bodies set up to provide speedy and specialised resolution of disputes in areas ranging from taxation and corporate law to administrative matters, thereby reducing the caseload on other courts.

In September 2021, the Madras Bar Association (MBA) challenged the constitutional validity of the Tribunals Reforms Act, calling it a direct attempt at “legislative overruling” of a Supreme Court judgment and claiming that it undermined the independence of the judiciary.

The challenge centred on provisions of the Act that are identical to those of an earlier ordinance, which the Supreme Court had struck down in July 2021. The most contentious was fixing the term of office for tribunal members at four years and setting the minimum age for their appointment at 50 years.

The association argued that by re-enacting the very same provisions that the court found unconstitutional, Parliament nullified a judicial verdict without removing the legal basis or “defect” pointed out by the court. This, it contended, violates the basic principles of judicial independence and separation of powers.

Behind long-running tussle over tribunals

The case is the latest chapter in a legislative and judicial back-and-forth that began in 2017 with the Finance Act, which empowered the Centre to frame rules for tribunals. The rules notified by the government were struck down by a Constitution bench of the Supreme Court in the Rojer Mathew case in 2019 for undermining judicial independence.

When the Centre notified a new set of rules in 2020, they were again challenged by the MBA. In that case, the Supreme Court recommended several modifications — including a five-year tenure for tribunal members to ensure their independence. It argued that a shorter term would discourage meritorious candidates and increase executive interference.

However, the Centre promulgated an ordinance in April 2021 that fixed the tenure at four years and set a minimum appointment age of 50 years. Just three months later, the Supreme Court struck down the two provisions as “arbitrary” and contrary to the separation of powers.

In a direct legislative response, Parliament passed the Tribunals Reforms Act a month later, re-enacting the same provisions the court had declared unconstitutional.

The arguments

The petitioners, led by the MBA, argued that a four-year tenure makes members of tribunals insecure and susceptible to executive pressure, especially if they hope to be reappointed. They also contended that the 50-year age limit arbitrarily excludes successful younger lawyers from consideration, even though a person can become a High Court judge at a younger age.

The Union government, in its counter-affidavit filed before the court, said that the age limit ensures that candidates have sufficient experience and that a four-year term, combined with the possibility of reappointment, provides adequate security.

It further defended the Act as a matter of “pure policy” which fell within the exclusive domain of Parliament. By striking down these provisions, it said, the judiciary was violating the separation of powers.

The fallout

The standoff over appointments and service conditions has caused long delays in filling tribunals’ vacancies. For instance, government data from December 2022 showed significant vacancies across key tribunals: there were 24 vacancies each in the National Company Law Tribunal, which had a sanctioned strength of 32, and the Armed Forces Tribunal, whose sanctioned strength is 34.

In the Income Tax Appellate Law Tribunal, 18 of the 63 judicial member posts were vacant. In the Railway Claims Tribunal, both the posts of vice chairman (judicial) were not filled, as were 16 out of 20 judicial member posts. Similarly, in the Central Government Industrial Tribunal-cum-Labour Courts and National Industrial Tribunals, there were only 13 presiding officers against the sanctioned strength of 22.

The Supreme Court itself has previously observed that the delays in appointments have left tribunals “virtually defunct”.