Tribunals Reforms: Madras Bar Association Petition Summary

Tribunals Reforms Act, 2021

Tribunals Reforms: Madras Bar Association Petition Summary

In August 2021, Parliament enacted the Tribunal Reforms Act, 2021 (the Act). Tribunals adjudicate disputes but invariably include executive branch personnel as judges. This Act seeks to standardize the membership appointment rules for tribunals and their conditions of their service.

The Madras Bar Association (the Association) challenged the Act for damaging the independence of the judiciary and reversing the Court’s earlier rulings on tribunal design.

The Association was founded in Chennai in 1865. Set up by advocates, the Association has actively challenged several previous attempts to create an executive-dominated tribunals system. In R Gandhi (2010), and four cases titled Madras Bar Association v Union of India (the 201420152020 and 2021 judgments) the Association secured favourable verdicts from the Supreme Court. It is these five judgments, particularly the 2020 and 2021 judgments, which the Association argues have been illegally overruled.

They have challenged various provisions in the Act. They are:

The Relief Sought

The Association has asked the Court to:

  1. Declare ss 3(1), 3(7), 5 and 7(1) of the Act unconstitutional as  it damages the basic features of separation of powers and independence of the judiciary, as well as previous decisions of the Supreme Court.
  2. Declare s 29 void as it amends a money bill through ordinary legislation.
  3. Order the establishment of a separate wing under the Finance Ministry, or a National Tribunals Commission, to cater to the requirement of tribunals in India.

The Grounds

The Act Reverses the Court’s Earlier Rulings

The primary argument against the challenged provisions in the Act is that it has illegally reversed earlier rulings of the Court. Parliament is allowed to reverse the Court’s rulings, provided that it has cured the ‘defect’ that led to the ruling.

The Association has referred to parts of the 2020 and 2021 judgments that have held similar provisions to be unconstitutional. They state that the Act has brought back provisions without making the necessary changes to make it constitutionally valid.

For example, the Court had previously ordered the appointment of various tribunal members and stated that they would enjoy a tenure till the age of 62. However, the proviso to s 5 in the Act says that they will have a maximum tenure of five years. The Association argues that such an interim order of the Court cannot be reversed by legislation.

The Act Has Delegated Too Many Powers

Two provisions in the Act: ss 3(1) and 7(1) have delegated the power to make Rules on various service conditions including salaries and allowances to the Union Government. By avoiding legislative scrutiny over Tribunal service conditions, these Rules excessively delegate powers. The Association argues that the power to make such law is an essential function of the legislature, and the ‘Court can strike down without any hesitation any arbitrary power conferred upon the legislature’.

The Act Violates the Principle of Separation of Powers

The Association states that the principles of the separation of powers and the independence of the judiciary is a part of the Constitution. In fact, it is part of the basic structure of the Constitution. The Association argues that the Act as a whole interferes with the judicial functions of tribunals.

Further, the Association argues that the short tenure of four years violates these principles as well. Short tenures would increase the control of the executive and affect impartiality, since tribunal members will be concerned about their livelihood after retirement. In its 2020 judgment, the Supreme Court had prescribed a minimum tenure of five years.

The Act Hinders the Effective and Efficient Administration of Tribunals

The minimum eligibility age of 50 years would be ‘anti-merit’ as it would reduce the number of applicants and deny  younger members the opportunity to apply. In the 2020 judgment, the Court said it is ‘essential that… practitioners with… vitality, energy and enthusiasm are attracted’.

Further, s 3(7) says the Union Government will consider making appointments ‘preferably’ within three months of it being recommended by the Committee. The Association argues that the three month period should be mandatory as delays in the appointments process leads to increasing vacancies and resulting delays in case disposals.

An Ordinary Bill Cannot Amend A Money Bill

‘Money bills’ are laws that deal primarily with financial matters. A money bill does not need the Rajya Sabha’s approval once the Lok Sabha has passed it. s 29 of the Act has repealed certain provisions of the Finance Act, 2017, which was a money bill. Since the Tribunals Act was an ordinary bill, the Association argues that an ordinary bill cannot amend a money bill.

The Act was Passed without Proper Deliberation

When the Act was passed, Parliament was in disarray as the Opposition was protesting the government’s refusal to modify the agenda of the House. The Association cited an article by American scholar Stephen Gardbaum and an Israeli Supreme Court case to argue that the lack of deliberation in Parliament calls for judicial review. They argue that it is a ‘political process failure’ and judicial review would be a suitable ‘external control’.