The president on April 4th 2021 passed an ordinance by exercising the power given to him under Article 123(1) of the Constitution of India[1]. The Tribunal reforms (Rationalisation and Conditions of Service) Ordinance 2021 was introduced by the centre which replaced the Appellate authority with High Court in as many as 9 Laws and brought some other changes as discussed below.
History
The ordinance follows the Rules made in 2017 & 2020 which were seriously criticized by the supreme court of India[2]. The 2017 Tribunal rules were quashed by the Supreme Court in the 2019 case of Roger Mathew Vs South Indian Bank ltd & others[3] on the ground that they affected the judicial independence[4]. In 2020 another attempt was made by the centre in framing another set of Rules but it was soon found that it carried the same deficiencies as in the 2017 Rules.
Later, the Supreme Court after finding several discrepancies with the bill issued strict directions to modify the same in the case of Madras Bar Association vs. Union of India[5].Thereafter on 13th of February 2021, another attempt was made by the centre to pass the bill in parliament but failed to do so. Since, the bill did not get the parliamentary nod it as issued as an ordinance by the president.
The following nine laws were modified in order to replace appellate authorities/tribunals with High Court:
- The Cinematograph Act, 1952.
- The Trade Marks Act, 1999.
- The Copyright Act, 1957.
- The Patents Act, 1970.
- The Customs Act, 1962.
- The Airports Authority of India Act, 1994.
- The Control of National Highways (Land and Traffic) Act, 2002.
- The Geographical Indications of Goods (Registration and Protection) Act, 1999.
- Protection of Plant Varieties and Farmers’ Rights Act, 2001
The ordinance has also brought significant changes to the Finance act 2017.
- Now, the central government has the power to make rules with regard to appointment, qualification, term of office, salaries and allowances, resignation, removal, and other terms and conditions of service for the members of tribunals.
- To solve the issue relating to appointment of chairperson and members of the tribunals, a Search cum- Selection committee will be set up to focus on such appointments and recommendations. The committee shall consist of (i) One Chairperson- The Chief Justice of India or any other Supreme Court Judge as per Chief Justice’s nomination and will have the right to caste vote, (ii) Two Secretaries as per Central government’s nomination, (iii) the sitting or outgoing Chairperson, or a retired Supreme Court Judge, or a retired Chief Justice of a High Court, (iv) the Secretary of the Ministry under which the Tribunal formed, having no right to vote.
- Tenure of Tribunal’s Chairperson is amended to a term of 4 years or retirement at the age of 70, whichever is earlier whereas the members of the tribunal will have to serve a term of 4 years or retirement age of 67.
The need for tribunal reform ordinance:
- Unfilled vacancies- There exists a high level of unfilled vacancies as different level of expertise and qualification are required for different tribunals.
- High number of pending cases- According to the 272 Law Commission report, Tribunals like Central Administrative Tribunals (CAT) and others had a total of 2.5 Lakhs pending cases o which more are added every day.
- Lack of independence- It is pertinent to note that key positions in the tribunal is held by Executives and government is the biggest litigant. Also, an interim report titled “Reforming the Tribunals Framework in India” clearly mentioned that tribunals in India are not independent due to which justice is not served fairly whereas considering the shift of appeals to the judiciary will ensure fair trial.
- Non- Uniformity- Due to lack of uniformity across various tribunals with regard to service conditions, tenure of members and varying nodal ministries in charge of different tribunals has added to the malfunctioning in administration and management of tribunals.
- Ad-hoc regulation of tribunals- Different tribunals fall under different nodal ministries which are subject to frequent ad-hoc changes. By transferring the power of tribunals to High Court, the possibility of such ad-hoc changes can be eliminated.
- Bypassing jurisdiction of the High Court by some tribunals- Tribunals like CAT, NCLAT have provisions to directly appeal to the Supreme Court, thereby bypassing the High Court’s jurisdiction and creating congestion in the Supreme Court. This also leads to a costlier and sometimes inaccessible justice. This was also highly criticised by the apex court in L. Chandra Kumar Vs. Union Of India And Others[6] wherein it was held that the power of the High Courts under Article 226 and 227 to exercise judicial superintendence over the decisions of all courts and tribunals, is a part of the basic structure of the Constitution. It also stated that “all decisions of Tribunals, whether created pursuant to Article 323A or Article 323B of the Constitution, will be subject to the writ jurisdiction of the High Courts under Articles 226/227 of the Constitution, before a Division Bench of the High Court within whose territorial jurisdiction the particular tribunal falls.”
Challenges caused due to the passing of Ordinance:
- Burdening Judiciary- Not only the Tribunals but the constitutional courts also have very high number of pending cases and vacancies. Therefore transferring all the appeals to high court will lead to further delay and burden upon the judiciary. As of 2017, 26 million cases are still pending before the Courts of India.
- Against the flexibility of justice delivery system- With the introduction of Tribunals the stringent and inflexible procedures of court were eliminated, as the administrative tribunals have an informal and easy going procedure.
- High disposal rate of cases- Although there is a high number of pending cases before the tribunals, the disposal rate as per the 272 Law commission report remains high and in such a situation scrapping the tribunals may highly affect the disposal rate of case.
Suggestions–
- Instead of abolishing the existing Tribunals. The government should focus on bringing uniformity, empowering the existing Tribunals and filling out vacant positions in order to achieve the maximum functionality. Also, Leggatt Report of United Kingdom can be followed, as both countries have the same Administrative framework and UK suffered from similar tribunalisation issues.
- A major amendment has to be brought to the tribunals provisions that left High Court of its jurisdiction. No direct appeal shall be made to the Supreme Court from a tribunal. Statutory appeals to High Courts can be allowed for cases that involve substantial question of law.
- The Tribunals framework can operate under an independent statutory body, provisionally called the National Tribunals Commission (NTC).
- Vacancies arising in tribunals should be filled up within 6 months prior to the occurrence of a vacancy.
- Also, as suggested by the 74th Parliamentary Standing Committee Report in 2015. The issue of malfunctioning of tribunals can be addressed by and independent agency for their administration, preferably in the form of single nodal ministry.
- There should be a bar on reappointment of tribunal members.
- Salaries and other allowances should be made uniform across all tribunals.
[1] Constitution of India, Article123 (1)
[2] Manu Sebastian, Live law, Tribunals Reforms Ordinance : Certain Points Of Concern, (19/04/2021. 03:20)https://www.livelaw.in/columns/tribunals-reforms-ordinance-certain-points-of-concern-172437
[3] ROJER MATHEW v. SOUTH INDIAN BANK LTD AND ORS CHIEF MANAGER Special Leave Petition (Civil) No. 15804 Of 2017
[4] LIVELAW NEWS NETWORK, SC Strikes Down Rules Framed By Centre Under Section 184 Finance Act 2017 For Tribunals, (19/04/2021. 03:20), https://www.livelaw.in/top-stories/sc-strikes-down-rules-framed-by-centre-under-finance-act-2017-for-tribunals-149729
[5] LIVELAW NEWS, Supreme Court Directs To Constitute National Tribunal Commission For Appointments To Tribunals, Lawyers With 10Yrs Practice Eligible For Appointment A(19/04/2021.03:20),https://www.livelaw.in/top-stories/supreme-courtnational-tribunal-commission-for-appointments-to-tribunals-lawyers-eligible-for-judicial-members-166456
[6] L. Chandra Kumar vs Union Of India And Others 1997 (2) SCR 1186
Author: Joshua Daniel, IPR Attorney.
Juris Centre 