TMI Blog2017 (12) TMI 1232X X X X Extracts X X X X X X X X Extracts X X X X ..... ailable, the matters where an urgent adinterim or interim relief is sought can be placed before the Administrative Member sitting singly. As far as selection of the Members covered by clauses (d), (e) and (f) of subrule (1) of Rule 1 of Rule 6 is concerned, the State Government shall constitute a proper Selection Committee preferably headed by a retired Judge of this Court, in the light of observations made in this judgment and order. The State shall also ensure that the Members shall be judicially trained in the sense that they have long experience of dealing with quasijudicial proceedings and/or adjudication proceedings. High court disposed off the petition with detailed instruction to the government. - WRIT PETITION NO. 2069 OF 2015 - - - Dated:- 29-9-2017 - A.S.OKA AND RIYAZ I. CHAGLA, JJ. Mr. R.V. Desai, Senior Advocate with Mr. Ratan Samal, Mr. Deepak Bapat, Mr. Pardesi, Ms. Nikita Badeka, Mr. V.P. Pathkar and Ms. Manjiri Sharad Parasnis for the petitioner. Mr. V.A. Sonpal, Special Counsel with Ms. Geeta Shastri, Addl.GP for the respondents. ORAL JUDGMENT : (Per A.S.Oka, J.) The submissions of the learned counsel appearing for the parties wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d or as the State Government may fix in his case. (4) Any vacancy in the membership of the Tribunal shall be filled up by the State Government as soon as practicable. (5) The functions of the Tribunal may be discharged by any of the members sitting either singly, or in Benches of two or more members, as may be determined by the President. (6) If the members of a Bench are divided, the decision shall be the decision of the majority, if there be a majority; but if the members are equally divided, they shall state the point or points on which they differ, and the case shall be referred by the President of the Tribunal for hearing on such point or points to one or more of the other members of the Tribunal; and such point or points shall be decided according to the majority of the members of the Tribunal who heard the case including those who first heard it. (6A) Subject to such conditions and limitations as may be prescribed, the Tribunal shall have power to award costs, and the amount of such costs shall be recoverable from the person ordered to pay the same as an arrears of land revenue. (6AA) [********] (7) Subject to the previous sanction of the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.IX of 2005, the Maharashtra Value Added Tax Act, 2002 ( for short VAT Act ) was enacted which was brought into force with effect from 1st April 2005. Under Section 95 of the VAT Act, the Sales Tax Act was repealed. Section 11 of the VAT Act provides for constitution of Tribunal. Section 11 of the VAT Act reads thus: Section 11 Tribunal (1) There shall be a Tribunal to be called the Maharashtra Sales Tax Tribunal . The Tribunal shall consist of such number of members appointed by the State Government as the Government may, from time to time, consider necessary for the proper discharge of the functions conferred on the Tribunal by or under this Act. (2) The State Government shall appoint one of the members of the Tribunal to be the President thereof on the basis of his seniority in the Judicial Service. (3) The qualifications and the terms of office of the members of the Tribunal shall be such as may be prescribed, and a member shall hold office for such period as may be prescribed or as the State Government may, by special order in his case, specify. (4) Any vacancy of the member of the Tribunal shall be filled up by the State Government as soon as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2005 (for short VAT Rules ) were framed in exercise of rule making powers under the provisions of the VAT Act. Rule 6 lays down the qualifications of the Members of the Tribunal, which reads thus: 6. Qualifications of members of tribunal and term of office.- (1) Every member of the Tribunal shall be a person who, (a) is or has been a Judge of the High Court, or (b) is or has been a District Judge, or (c) is qualified for appointment as a District Judge, and has held judicial office for not less than ten years, or (d) has, for a continuous period of not less than two years held an office, not below the rank of Joint Commissioner of Sales Tax, in the Sales Tax Department of the State Government, or (e) is a Chartered Accountant and has practised as such for not less than seven years, or (f) not being a person described in clause (e), has in the opinion of the State Government, adequate knowledge, or experience in accounting, or has, in the opinion of the State Government, special knowledge or experience in commerce or industry. Explanation : For the purpose of clause (b), the service as a Deputy Commissioner before the appointed day s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt in the cases of Madras Bar Association v. Union of India and another (2014) 10 SCC 1; State of Gujarat v. Gujarat Revenue Tribunal Bar Association (2012) 10 SCC 353; Satya Pal Anand v. State of Madhya Pradesh (2014) 7 SCC 244; and Supreme Court Advocates on record Association and another v. Union of India (2016) 5 SCC 1 . He also relied upon the decision of the Apex Court in the case of Union of India v. R.Gandhi, President, Madras Bar Association (2010) 11 SCC 1. He also invited our attention to the decision of the Apex Court in Namit Sharma v. Union of India (2013) 1 SCC 745. He also invited our attention to the decision of the Apex Court in the case of State of Maharashtra v. Labour Law Practitioners' Association and others (1998) 2 SCC 688. 7. He invited our attention to Section 11 of the VAT Act. He pointed out that the power of appointing Members of the Tribunal including the President thereof has been conferred on the Government. The submission is that neither the VAT Act nor the VAT Rules provide for consultation with this Court, especially in the light of the fact that the Tribunal has all the trappings of a Civil Court. He in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of Sales Tax as Members of the Tribunal, on a Committee headed by the Chief Secretary as the Chairman. The other two members are Secretary, Law and Judiciary Department and Secretary, Finance Department as members. He, would, submit that such a Government Resolution is arbitrary and irrational and cannot stand to the scrutiny of reasonableness. 10. The learned AGP submitted that there is nothing wrong if a Technical Member, who has been a Joint Commissioner, becomes a Member of the Tribunal as such appointments are constitutionally accepted in case of several Tribunals. The Technical Members can effectively assist the Judicial Members considering their expertise. He pointed out that in case of several Tribunals, there is a provision for appointing technical or non judicial Members and there is no illegality associated with inclusion of Technical Members as a part of the Tribunal. He has placed on record a compilation containing VAT Rules of various other States for pointing out that the Administrative Members are a part of such Tribunals in all the States. He invited our attention to the affidavit of Shri Rajendra D. Bhagat, Deputy Secretary (Finance Department), Government o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ajority. If the Bench consists of two Members, the Administrative or Technical Member can differ and in such case, the matter will be referred by the President to another Member. 13. We have already quoted Rule 6 of the VAT Rules. There is an apparent inconsistency between clause (d) of sub rule (1) of Rule 6 and the explanation to sub rule (1) of Rule 6. One of the qualifications for appointment as a Member of the Tribunal is of a continuous period of service of not less than two years holding an office not below the rank of Joint Commissioner of Sales Tax in the Sales Tax Department of the State. Thus, a person belonging to the rank of Joint Commissioner of Sales Tax can be appointed as a Member provided he has held the said office for at least two years. Initially, the period of three years was provided in clause (d). Explanation to sub section (1) of Section 6 explains that for the purposes of clause (d), the service as a Deputy Commissioner of Sales Tax before the appointed day shall be considered for determining the period of three years. Firstly, clause (d) of sub section (1) provides that the person who is to be appointed as a Member of the Tribunal should hold the offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in the appointment of Judicial Members. The President appointed is also from amongst the appointed Judicial Members. Thus, the allegations of bias, separation of power, independence of judiciary etc are without any basis and are based on any unfortunate lack of knowledge of the correct factual position in regard to the appointment of Judicial Officers. (d) So far as the administrative members are concerned, the Petitioners are again factually incorrect The appointment of administrative members is made by a High Powered Committee consisting of the (a) Chief Secretary, (b) Secretary (L JD) and (c) Secretary, Finance. It is pertinent to note that the Secretary (L JD) is in his/her own right, an independent and impartial officer, him/her being a member of the Judicial Services of the State of Maharashtra, which is under the direct control, supervision, and superintendence of this Hon'ble Court. It therefore cannot be said that the High Powered Committee is in any manner constituted of only the officers of the State Government. (e) The appointment of the Administrative Members is made by the said High Powered Committee, from amongst those persons who have served as a J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich was till then dealing with such matters and the members of the Tribunal should have the independence and security of tenure associated with Judicial Tribunals. (c) Whenever there is need for `Tribunals', there is no presumption that there should be technical members in the Tribunals. When any jurisdiction is shifted from courts to Tribunals, on the ground of pendency and delay in courts, and the jurisdiction so transferred does not involve any technical aspects requiring the assistance of experts, the Tribunals should normally have only judicial members. Only where the exercise of jurisdiction involves inquiry and decisions into technical or special aspects, where presence of technical members will be useful and necessary, Tribunals should have technical members. Indiscriminate appointment of technical members in all Tribunals will dilute and adversely affect the independence of the Judiciary. (d) The Legislature can re organize the jurisdictions of Judicial Tribunals. For example, it can provide that a specified category of cases tried by a higher court can be tried by a lower court or vice versa (A standard example is the variation of pecuniary limits of courts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion Act, 2005. What is material for our purposes are the conclusions drawn is paragraph 108.2, which reads thus: 108.2 The provisions of Sections 12(5) and 15(5) of the Act of 2005 are held to be constitutionally valid, but with the rider that, to give it a meaningful and purposive interpretation, it is necessary for the Court to 'read into' these provisions some aspects without which these provisions are bound to offend the doctrine of equality. Thus, we hold and declare that the expression 'knowledge and experience' appearing in these provisions would mean and include a basic degree in the respective field and the experience gained thereafter. Further, without any peradventure and veritably, we state that appointments of legally qualified, judicially trained and experienced persons would certainly manifest in more effective serving of the ends of justice as well as ensuring better administration of justice by the Commission. It would render the adjudicatory process which involves critical legal questions and nuances of law, more adherent to justice and shall enhance the public confidence in the working of the Commission. This is the obvious interpretation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th by the civil Courts. On this aspect, various decisions of the Apex Court will have to be considered including the well-known decision of the Apex Court in the case of L.Chandra Kumar v. Union of India and others (1997) 3 SCC 261. We may note that the said decision of the Apex Court deals with the provisions of the Administrative Tribunals Act, 1985. We may also note that there was an earlier decision of the Apex Court in the case of S.P.Sampath Kumar v. Union of India (1987) 1 SCC 124 . 25. As the learned Senior Counsel appearing for the Petitioners had placed reliance on the decision of the Constitution Bench of the Apex Court in the case of Madras Bar Association v. Union of India (2010)11 SCC 1 and another , it will be necessary to make a brief reference to the said decision. We must note here that in the said decision, the Constitution Bench has quoted with approval its earlier decision in the case of Union of India v. R.Gandhi, President, Madras Bar Association (2010) 11 SCC 1 and in particular what is held in paragraph 106. We may note here that the decision of the Apex Court in the case of Madras Bar Association v. Union of India (supra) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever, in each case, the principles of natural justice are required to be observed. Such tribunals therefore, basically perform quasi judicial functions. The system of tribunals is hence, unlike that of the regularly constituted courts under the hierarchy of judicial system which are not authorised to devise their own procedure for exercise certain powers conferred under some provisions of the Code of Civil Procedure (hereinafter referred to as CPC ) or the Code of Criminal Procedure (hereinafter referred to as CrPC ), but not under the whole Code, be it Civil or Criminal. However, in a regular Court, the said Codes, in their entirety, Civil as well as Criminal, must be strictly adhered to. Therefore, from the above, it is evident that the terms court and tribunal are not interchangeable. 17. A tribunal may not necessarily be a Court, in spite of the fact that it may be presided over by a judicial officer, as other qualified persons may also possibly be appointed to perform such duty. One of the tests to determine whether a tribunal is a Court or not, is to check whether the High Court has revisional jurisdiction so far as the judgments and orders passed by the Tribunal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te. Only when it is found that the State has transferred the sovereign judicial powers to the Tribunal, it can be categorised as a Court. The Apex Court, in the facts of the case, noted the powers vested in the Revenue Tribunal and held that the Revenue Tribunal is akin to a Court. We may note here that in paragraph34, the Apex Court held that the object of consultation with the High Court is to render the consultation meaningful to serve the intended purpose. In paragraph 34 the Apex Court has laid down a law on the aspects, which reads thus: The object of consultation is to render the consultation meaningful to serve the intended purpose. It requires the meeting of minds between the parties involved in the process of consultation on the basis of material facts and points, to evolve a correct or at least satisfactory solution. If the power can be exercised only after consultation, consultation must be conscious, effective, meaningful and purposeful. It means that the party must disclose all the facts to other party for due deliberation. The consultee must express his opinion after full consideration of the matter upon the relevant facts and quintessence. ( Vide: UOI v. Sanka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... list bodies comprising both trained administrators and those with judicial experience would, by virtue of their specialised knowledge, be better equipped to dispense speedy and efficient justice. It was expected that a judicious mix of judicial members and those with grass roots experience would best serve this purpose. To hold that the Tribunal should consist only of judicial members would attack the primary basis of the theory pursuant to which they have been constituted. Since the Selection Committee is now headed by a Judge of the Supreme Court, nominated by the Chief Justice of India, we have reason to believe that the Committee would take care to ensure that administrative members are chosen from amongst those who have some background to deal with such cases. (emphasis added) Hence, in so many words, the Apex Court has held that setting up of the Tribunals is founded on the premise that specialist bodies comprising both trained administrators and those with judicial experience would, by virtue of their specialised knowledge, be better equipped to dispense speedy and efficient justice. This observation was made in the light of comments made by Malimath Committee whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Joint Commissioner of Sales Tax in the Sales Tax Department, who has, for a continuous period of not less than three years held the said office is eligible. Clause (e) provides that a Chartered Accountant who has practised as such for not less than seven years is eligible. Clause (f) provides for an appointment of a person not being a person covered by clause (d), who is in the opinion of the State Government has adequate knowledge and experience in accounting or in the opinion of the State Government has special knowledge or experience in commerce or industries. Thus, even in the present case, the qualifications prescribed are very vague. If we look at the scheme of the VAT Act, the Tribunal is vested with the vast powers of adjudication. Vast appellate powers have been conferred on the Tribunal. Hence, there is some merit in the submissions made by the learned senior counsel appearing for the petitioner that in absence of proper qualifications being prescribed in the VAT Rules, the provisions of the VAT Rules will expose itself to vice of unconstitutionality. 29. It is in this context that the decision of the Apex Court in the case of Namit Sharma (supra) is relevant. The Ape ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the ends of justice as well as better administration of justice. 30. Unless we adopt the similar approach, in the facts of the present case, the relevant provisions of the VAT Rules will attract the vice of unconstitutionality. Therefore, when appointment of Administrative Member is made of the officer not below the rank of Joint Commissioner of Sales Tax or the one which is covered by clauses (e) and (f) of sub rule 1 of Rule 6, it will be necessary that the persons concerned are legally qualified and judicially trained. In case of the Joint Commissioners of Sales Tax, it is necessary that they have a judicially trained mind in the sense that they have a long experience of dealing with the quasi judicial proceedings involving the adjudication of disputes. The Tribunal has to deal with the legal issues and therefore, these requirements will have to be read into the Rules. Apart from the fact that if the said requirements are not read into the Rules, the Rules will expose itself to the vice of unconstitutionality, such requirements are necessary for the effective functioning of the Tribunal and for achieving the object for which the Tribunal has been created by the law. 31. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of members of Tribunal and term of office , in fact, the said Rule is silent about the term of office. It will be advisable for the State Government to amend the Rules and to prescribe the term of office and/or age of retirement. 34. We have perused the earlier orders passed by various Division Benches from time to time which take care of various issues concerning the infrastructure. In addition to those directions, which are already issued, certain other directions will have to be issued. 35. We had called from the Registry the figures of filing of cases in the Tribunal during the years 2012 to 2016 and the present position of pendency. The Chart received by Registry is reproduced for ready reference: FILING OF CASES PER YEAR DURING 2012 TO 2016 APP S.A. REVI- SION RESTO- RATION RECTIFI- CATION MISCELL- ANEOUS REFE- RENCE VAT APP VAT S.A. ENTRY TAX TOTAL 2012 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Court has made a reference to the judgment and order dated 2nd January 2017 passed by the Apex Court in the case of Imtiyaz Ahmad Vs. State of Uttar Pradesh and others Criminal Appeal Nos.254-262 of 2012 decided on 2nd January 2017. In the said order, based on interim recommendations of the National Court Management System Committee (NCMSC), the Apex Court directed that the appointment of adequate numbers of the Judges required in the Courts should be made by creating additional posts and accordingly necessary infrastructure be provided. 37. The State Government will have to undertake the scientific study of number of members required for the said Tribunal. While doing so, the State Government will be naturally guided by the law laid down in the case of Imtiyaz Ahmad Vs. State of Uttar Pradesh Ors. (supra). By appointing a Committee, preferably headed by a retired Judge of this Court, the State Government will have to undertake the said exercise and after considering the recommendations of the Committee, the State Government will have to appoint such number of the additional members who are required to take care of pendency at present and the pendency in the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... auses (a), (b) or (c) of sub rule (1) of Rule 6 of the VAT Rules shall be appointed without making effective consultation with the High Court of Judicature at Bombay. Needless to add that the effective consultation shall be as per the law laid down in the case of State of Gujarat Vs. Gujarat Revenue Tribunal Bar Association (supra); (ii) In view of the statements made in the aforesaid affidavit, we clarify that a Bench of two or more Members shall always be headed by a Judicial Member appointed under clauses (a), (b) or (c) of sub rule 1 of Rule 6 of the VAT Rules; (iii) The matters which are required to be decided by the Members sitting singly shall always be placed before a Judicial Member only. In case of emergency, when none of the Judicial Members are available, the matters where an urgent ad interim or interim relief is sought can be placed before the Administrative Member sitting singly; (iv) As far as selection of the Members covered by clauses (d), (e) and (f) of sub rule (1) of Rule 1 of Rule 6 is concerned, the State Government shall constitute a proper Selection Committee preferably headed by a retired Judge of this Court, in the light of observations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the President/Members of the Tribunal as regards the infrastructure to be provided to them and to the Tribunal, the State Government will be bound by the law laid down by this Court in the case of Mumbai Grahak Panchayat Anr. (supra); (xii) The Tribunal shall take immediate steps to ensure that all the orders passed by the Tribunal are immediately uploaded on the dedicated web site; (xiii) The Tribunal shall consider of adopting project of computerisation and digitization on the lines of E Court Phase I and E Court Phase II deviced by e Committee of the Hon'ble Supreme Court of India. Needless to add that on requisition made by the President of the Tribunal, necessary assistance will be rendered by the team of the High Court of Judicature at Bombay, Central Project Co ordinator. If a requisition is made by the President of Tribunal for creating posts of technical staff, the State Government shall take immediate steps for creating necessary technical posts. (xiv) We must clarify here that what is held by this Court and what is directed by this Court will not affect the validity of appointment of the Members who are already appointed and who are functioning t ..... 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