Tribunals Reforms | Day 6: “Our main question is, what prompted this reform?” asks Justice K.V. Chandran during final hearings

Tribunals Reforms Act, 2021

Judges: B.R. Gavai J, K.V. Chandran J

On 10 November, a Bench of Chief Justice B.R. Gavai and Justice K.V. Chandran heard submissions from Attorney General R. Venkataramani on the constitutional validity of the Tribunal Reforms Act, 2021. The Bench also heard Senior Advocate Porus Kaka who appeared for the Income Tax Appellate Tribunal (ITAT) Bar Association and disposed of several interlocutory applications.

One of the key contentions is the provision that fixes a four-year term for tribunal members with the scope of re-appointment. The petitioners have contended that the re-appointment process facilitates executive interference with independence of the judiciary. Defending the provision, the Union submitted that reappointment would be based on service rendered, hence ensuring high performance and accountability. It further argued that it was the judiciary, not the executive, that had the final say. 

CJI Gavai: “Let’s not open a pandora’s box”

Venkataramani began his submissions by responding to some IAs that were previously taken up on 7 November. He assured that the present incumbent members in the National Green Tribunal would retain their role until new members are selected. Similarly, four members appointed to the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) in 2018 were assured that their tenure would continue until they turn 62. Orders were passed accordingly and the IAs disposed of. 

Responding to the seven CESTAT members who sought parity with those appointed subsequently, Venkataramani submitted that their Special Leave Petition had already been dismissed. “We cannot reopen the concluded case,” said CJI Gavai. 

The Bench further refrained from “opening a pandora’s box” with the IA on 2018 appointments to the ITAT.

One size fits all approach

Resuming his arguments from 7 November, Kaka sought to clarify the position of Rojer Mathew, where a three year tenure for tribunal members was struck down. He pointed out that the Court did not conclusively approve of five or seven years. Kaka added that each tribunal had its own requirements and submitted that the Court had not previously ruled on the ITAT in particular. 

“Three, four and five years have been struck down,” he said, urging the Union to reconsider its “one size fits all” approach. 

“Is it your submission that the IT tribunal should be segregated from the rest?” asked CJI Gavai. “My submission is that it always has been,” said Kaka. 

In response, Venkataramani argued that it was the Court in Rajiv Garg v Union of India which directed the Government to take a decision on uniformity in service conditions. “We had to honor that directive,” he said, “It is not pulled out of a hat, not from our imagination.” Referring to Datar’s concept note, he pointed out that by recommending a National Tribunals Commission, the petitioners’ submissions also had the “underlying premise of uniformity.” He argued that the Court in Rojer Mathew merely struck down three years, but did not question the aspect of uniformity. He reiterated that the Court’s proposals and reflections cannot be interpreted as a binding mandamus.

At this juncture, CJI Gavai asked the Attorney General whether the Court incorrectly reconsidered Rojer Mathew in the Madras Bar Association – 3 (2020). In Rojer Mathews, the Court had struck down a three-year term. Subsequently, in the 2020 verdict the Court struck down the new Rules, 2020 which introduced a four year term, directing an increase to five years instead. The Tribunals Reforms Ordinance, 2021 reintroduced the four year term period, which was struck down again in Madras Bar Association-4 (2021).  Venkataramani responded that he would not say that the 2020 verdict incorrectly considered Rojer Mathew. Referring to the 2021 decision, Venkataramani observed the Court “probably took it beyond what was intended”. 

Venkataramani: “The 2021 Act is a culmination of the judgements and Parliament talking to each other”

Venkataramani argued that the Court’s decision in the Madras Bar Association cases (2010, 2014, and 2020) had identified all defects, which were cleared by the amendments passed by Parliament. He traced the evolution of amendments from Articles 323 and 323B to decisions such as S.P. Sampath Kumar (1987) and L. Chandra Kumar (1997). He  argued that the Union has always heeded to the views of the Court. “Veto power now lies with the chairperson,” he said, “the concern about executive control no longer exists in appointment or reappointment.”

Venkataramani submitted that locating eligible and experienced candidates was the real challenge. He argued that the “reappointment principle does not fall foul of any principle of independence”. 

CJI Gavai asked, “According to you, there is an inbuilt assurance of reappointment in the new Act? Without the rigor of the selection process?” 

“No, the point is that only your record of performance will carry weight, nothing else” Venkataramani replied, assuring that Parliament has not vested any extraordinary powers on the executive. Referring to Shankar Raju (2011), he argued that even the defect of arbitrary removal has been addressed in the 2021 Reforms as it can now occur only under the “watchful gaze” of the Search-cum-Selection Committee (SCSC). 

Appearing for the main petitioner, Senior Advocate Arvind Datar intervened to point out that in Raju’s case, the petitioner was fighting for a third term. “Technically, reappointment can occur three times between the age of 50 to 62,” he said and questioned how someone who is eligible now can be less eligible at a later date.

CJI Gavai remarked that the question of independence of judiciary arises when there is reappointment by the same department and asked why there was a need for change when the ITAT has “worked so well for so many years.” Observing that a series of deviations are required to necessitate reform, Justice Chandran added, “you have not pointed out one instance of deviation.”

Justice Chandran asked the AG to clarify if the reappointment process is essentially a fresh selection. When the AG answered in the affirmative, he asked, “Does a reappointed person then become junior to the person selected two years before?” The AG replied that the Union had not yet come across that problem to which Justice Chandran noted that “Entitlement has been turned into eligibility.”

“Your best argument is to let it work for 10 years,” laughed CJI Gavai, adding that “Had I known at the age of 42 years that I would need to be reappointed every four years…” The AG hastily urged the Bench not to bring in the case of High Court judges. 

“A transition will always entail things you do not anticipate,” he said, “Is it that the Parliament’s hands are tied? Then I cannot do anything.” CJI Gavai retorted, “You can do everything. You are not precluded from doing anything except what has been struck down by the court.”

The Court agreed to extend the final day of hearing by one hour and scheduled the matter for 3pm on 11 November.