TMI Blog2021 (10) TMI 885X X X X Extracts X X X X X X X X Extracts X X X X ..... AT too has comprised advocates who have staffed the Tribunal efficiently. The absence of any explanation for the preference given to older persons, in fact leads to an absurd result - as was pointed out in MBA-III and as has been reiterated by L. Nageswara Rao, J. in his opinion. Prescribing 50 years as a minimum age limit for consideration of advocates has the devastating effect of entirely excluding successful young advocates, especially those who might be trained and competent in the particular subject (such as Indirect Taxation, Anti-Dumping, Income-Tax, International Taxation and Telecom Regulation) - Prescribing 50 years minimum age as a condition for appointment to these Tribunals is arbitrary also because absolutely no reason is forthcoming about what impelled Parliament to divert from the long-established criteria of giving weightage to actual practice, reputation, integrity and subject expertise, without a minimum age criterion, in the pleadings in this case, nor in any other cases. The age criteria, impugned in this case also leads to wholly anomalous and absurd results. For instance, an advocate with 18 or 20-years practice, aged 44 years, with expertise in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anner of selection, remuneration and security of tenure are vital to their efficiency and independent functioning. The manner of selection, conditions of eligibility, rules for their removal upon proven misbehaviour and so on, are entirely different from public servants. In fact, the latter category, i.e. members of Tribunals not drawn from public service sources, are not even holders of civil posts or members of any encadred civil service. This has been clarified in at least two judgments of this Court. They are not governed by Article 311 of the Constitution, nor are their conditions of service laid out in rules framed under the proviso to Article 309 of the Constitution. Such being the position, the argument of parity, in the opinion of the Court, is entirely devoid of merit. Nor is the argument of the Attorney General that a uniform age is necessary, merited. There is no material to show that members recruited on the technical side, such as experts in engineering, scientific or other technical fields would be suitable only after they cross the age of 50. In fact, one can complete a doctoral thesis and become a holder of a Ph.D at the time that she or he is 30 years or even b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, Naveen Hegde, Siddharth Vasudev, Navdeep Singh, Ms. Gayatri Gulati, Shakti Singh, Ms. Ankita Tiwari, Anmol Kheta, Sheezan Hashmi, Ms. Pratiksha Thakur, Ms. Swati Arya, Ms. Anika Dhingra, Abhishek Sharma, Nalin Talwar, Amish Tandon, Ayush Beotra, Abhinav Mishra, Uddhav Khanna, Dipin Tamang, Akshay Joshi, K.C. Kaushik, Ms. Bhuvneshwari Pathak, Ms. Shilpi Satyapriya Satyam, Pankaj Singh, Ms. Ranjana Singh, Rupesh Kumar, Ms. Neelam Sharma, Ms. Pankhuri Shrivastava, Nidad Laud, Sahil Tagotra, Alekshendra Sharma, Kaushik Mishra, Kiran Patel, Ms. Viapsha Singh, R. Gowrishankar, Gourav Agrawal, Chritarth Palli, Rajeev Sharma, Pravesh Bahuguna, P.B. Suresh and Sai Kaushal N., Advocates, for the appearing Parties. JUDGMENT [Judgment per : L. Nageswara Rao, J.]. - The Madras Bar Association has filed this Writ Petition seeking a declaration that Sections 12 and 13 of the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 and Sections 184 and 186(2) of the Finance Act, 2017 as amended by the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 as ultra vires Articles 14, 21 and 50 of the Constitution of India inasmuch as these are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stitute to High Courts. While scrutinizing Chapter II of the Act which dealt with the establishment of Tribunals, this Court expressed its view that a short tenure of Members of Tribunals would be a deterrent for competent persons to seek appointment as Members. 4. The correctness of the judgment of this Court in S.P. Sampath Kumar (supra) was considered by a Larger Bench of this Court in L. Chandra Kumar v. Union of India Ors. [(1997) 3 SCC 261 = 1997 (92) E.L.T. 318 (S.C.)] which found the exclusion of the jurisdiction of the High Courts and the Supreme Court in Articles 323A and 323B to be unconstitutional. This Court declared that Tribunals shall continue to act like Courts of first instance in respect of areas of law for which they have been constituted. 5. A High-Level Committee on law relating to insolvency of companies was constituted by the Union of India under the Chairmanship of Justice V. Balakrishna Eradi, retired Judge of this Court who made certain recommendations for setting up the National Company Law Tribunal (hereinafter referred to as NCLT) combining the powers of the Company Law Board under the Companies Act, 1956 (hereinafter referred to as the 1956 Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Union of India to scrupulously follow the judgment in MBA-I and set right the defects that were pointed out therein by bringing the provisions in accord with the MBA-I judgment. 7. The Finance Act, 2017 was brought into force from 31-3-2017 to give effect to the financial proposals for the financial year 2017-18. Sections 183 to 189 thereof dealt with conditions of service of Chairperson and Members of Tribunals, Appellate Tribunals and other authorities. According to Section 183, provisions of Section 184 applied to the Chairperson, Vice-Chairperson, Chairman, Vice-Chairman, President, Vice-President, Presiding Officer or Member of the Tribunal, Appellate Tribunal and other specified authorities, notwithstanding anything to the contrary contained in the provisions of the statutes listed in Column (3) of the Eighth Schedule. The Central Government was empowered by Section 184 to make rules to provide for qualifications, appointment, term of office, salaries and allowances, resignation, removal and other terms and conditions of service of the Chairperson and Vice-Chairperson (and commensurate positions bearing different nomenclature) and other Members. As per the first provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the 2020 Rules) were framed. The validity of the 2020 Rules was challenged by Madras Bar Association. After detailed deliberations on the issues involved, this Court by its judgment in Madras Bar Association v. Union of India Anr. [(2020) SCC Online SC 962 = 2020 (374) E.L.T. 817 (S.C.)] (hereinafter referred to as MBA-III) disposed of the writ petition by issuing the following directions : 53. The upshot of the above discussion leads this Court to issue the following directions : (i) The Union of India shall constitute a National Tribunals Commission which shall act as an independent body to supervise the appointments and functioning of Tribunals, as well as to conduct disciplinary proceedings against members of Tribunals and to take care of administrative and infrastructural needs of the Tribunals, in an appropriate manner. Till the National Tribunals Commission is constituted, a separate wing in the Ministry of Finance, Government of India shall be established to cater to the requirements of the Tribunals. (ii) Instead of the four-member Search-cum- Selection Committees provided for in Column (4) of the Schedule to the 2020 Rules with the Chief Jus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000/- per month as house rent allowance and ₹ 1,25,000/- per month for other members of the Tribunals. This direction shall be effective from 1-1-2021. (vi) The 2020 Rules shall be amended to make advocates with an experience of at least 10 years eligible for appointment as judicial members in the Tribunals. While considering advocates for appointment as judicial members in the Tribunals, the Search-cum-Selection Committee shall take into account the experience of the Advocate at the bar and their specialization in the relevant branches of law. They shall be entitled for reappointment for at least one term by giving preference to the service rendered by them for the Tribunals. (vii) The members of the Indian Legal Service shall be eligible for appointment as judicial members in the Tribunals, provided that they fulfil the criteria applicable to advocates subject to suitability to be assessed by the Search-cum-Selection Committee on the basis of their experience and knowledge in the specialized branch of law. (viii) Rule 8 of the 2020 Rules shall be amended to reflect that the recommendations of the Search-cum-Selection Committee in matters of disciplinar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere appointed after 12-2-2020. While reserving the matter for judgment on 9-10-2020, we extended the term of the Chairpersons, Vice-Chairpersons and members of the Tribunals till 31-12-2020. In view of the final judgment on the 2020 Rules, the retirements of the Chairpersons, Vice-Chairpersons and the members of the Tribunals shall be in accordance with the applicable Rules as mentioned above. 9. The Tribunal Reforms (Rationalisation and Conditions of Service) Bill, 2021 was introduced in the Lok Sabha on 13-2-2021 but could not be taken up for consideration. According to the Statement of objects and reasons, the said Bill was proposed with a view to streamline Tribunals and sought to abolish certain Tribunals and other authorities, which only add to another additional layer of litigation and were not beneficial for the public at large . Thereafter, the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 (hereinafter referred to as the Ordinance) was promulgated on 4-4-2021. Chapter II thereof makes amendments to the Finance Act, 2017. The dispute raised in this Writ Petition relates to the first proviso to Section 184(1) according to which a person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he supremacy of the Constitution. (iii) Stipulation of a minimum age limit of 50 years for appointment is contrary to the directions given in the judgments of this Court in MBA-I, Rojer Mathew (supra) and MBA-III. (iv) The provisos to Section 184(1) fixing the allowances and benefits payable to the Members to the extent as admissible to Central Government officers holding a post carrying the same pay is unsustainable and requires to be set aside. (v) Section 184(7) is liable to be declared invalid as the direction issued by this Court in MBA-III to make appointments within three months from the date of recommendation of the Selection Committee is sought to be annulled. (vi) Section 184(11) is unconstitutional insofar as it fixes the tenure of the Chairperson and Members as four years. (vii) Retrospectivity given to Section 184(11) is only to nullify the effect of interim orders of this Court which are in the nature of mandamus and is, therefore, prohibited legislative activity. (viii) The appointments made pursuant to the directions of this Court on 9-2-2018, 16-7-2018 and 21-8-2018 with the consent of the Learned Attorney General cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Judicial)/(Accountant) in the ITAT, 650 applications were filed. The candidates between the age of 35 years and 50 years were eligible according to the advertisement. Interviews were held between May-September, 2019. Appointments to the post of Accountant Members were made but the Judicial Members were not appointed. He submitted that there are few persons who are below 50 years and would not be considered for appointment in view of the Ordinance. He argued that Section 184(11) alone is given retrospective effect and the amendments to Section 184(1) to (10) would be prospective and cannot be made applicable to the recruitment and selection conducted prior to 4-4-2021. Therefore, according to Mr. Krishnan Venugopal, Learned Senior Counsel, the candidates who have been selected pursuant to the advertisement issued in 2018 should not be held ineligible on the ground that some of the candidates were below the age of 50 years on the date of the advertisement. 14. The Learned Attorney General strongly refuted the contentions of the Learned Amicus Curiae and other Senior Counsel. He stated that a judgment of a court can be overridden by the legislature. Service conditions of Members of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld in MBA-III that the 2020 Rules came into force on the date of their notification, i.e., 12-2-2020. Further, it was held that subordinate legislation cannot be given retrospective operation unless authorized by the parent legislation. By the Ordinance, the Finance Act has been amended and retrospective effect has been given to Section 184(11). Any judgment or orders passed between 26-5-2017 and 4-4-2021 are overridden by the Ordinance which is in the nature of a curative legislation. The Learned ASG submitted that all appointments that have been made between 26-5-2017 and 4-4-2021 shall be governed by the Ordinance. Separation of Powers 16. Sir Edward Coke on being summoned by King James I to answer why the King could not himself decide cases which had to go before his own Courts of justice, asserted : ... no king after the conquest assumed to himself to give any judgment in any cause whatsoever, which concerned the administration of justice within his realm, but these were solely determined in the Courts of justice . When the King said that he thought the law was founded on reason, and that he and others had reason, as well as the Judges , Coke answered: True it wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ructure of the Government furnishing proper checks and balances between different departments was the subject matter of Federalist No. 51. 20. All powers of Government - legislative, executive and judicial - result in the legislative body. The concentration of these powers in the same hands is precisely the definition of despotic Government. It will be no alleviation that these powers will be exercised by a plurality of hands and not by a single person. One hundred and seventy-three despots would surely be as oppressive as one. [See : Jefferson : Works : 3, 223] 21. The American Constitution provides for a rigid separation of governmental powers into three basic divisions, executive, legislative and judiciary. It is an essential principle of that Constitution that powers entrusted to one department should not be exercised by any other department. The Australian Constitution follows the same pattern of the separation of powers. Unlike these Constitutions, Indian Constitution does not expressly vest the three kinds of powers in three different organs of the State [Smt. Indira Nehru Gandhi v. Shri Raj Narain (supra)]. 22. The doctrine of separation of powers informs the India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t facto laws, and the like. Limitations of this kind can be preserved in practice in no other way than through the medium of courts of justice, whose duty it must be to declare all acts contrary to the manifest tenor of the Constitution void. Without this, all the reservations of particular rights or privileges would amount to nothing. 24. Basic Principles on the Independence of the Judiciary were adopted by the 7th United Nations Congress on the Prevention of Crime and the Treatment of Offenders held at Milan from 26-8-1985 to 6-9-1985 and endorsed by the General Assembly resolutions on 29-11-1985 and 13-12-1985. The relevant basic principles are that the independence of the judiciary shall be guaranteed by the State and enshrined in the Constitution or the law of the country. It is the duty of the governmental and other institutions to respect and observe the independence of the judiciary. The term of office of Judges, their independence, security, adequate renumeration, conditions of service, pensions and the age of retirement shall be adequately secured by law. The United Nations Economic and Social Council authorized the UN Sub-Commission on Prevention of Discrimination an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ors. v. Union of India - (1993) 4 SCC 441]. Article 50, occurring in a chapter described by Granville Austin as the conscience of the Constitution in his work titled The Indian Constitution : Cornerstone of a Nation , underlines the importance given by the Constitution-makers to immunize the judiciary from any form of executive control or interference [Union of India v. Sankalchand Himatlal Sheth Anr. - (1977) 4 SCC 193]. 27. The independence of the judiciary is a fighting faith of our Constitution. It is the cardinal principle of the Constitution that an independent judiciary is the most essential characteristic of a free society like ours and the judiciary which is to act as a bastion of the rights and freedom of the people is given certain constitutional guarantees to safeguard the independence of judiciary. An independent and efficient judicial system has been recognised as a part of the basic structure of our Constitution [Supreme Court Advocates-on-Record Association Ors. v. Union of India (supra)]. 28. Article 37 of the Constitution declares that the principles laid down in Part IV of the Constitution are fundamental in the governance of the country and it sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aration from other branches of the Government, especially when the branch is a litigant or one of the parties before the Tribunal. Functional independence would include method of selection and qualifications prescribed, as independence begins with appointment of persons of calibre, ability and integrity. Protection from interference and independence from the executive pressure, fearlessness from other power centres - economic and political, and freedom from prejudices acquired and nurtured by the class to which the adjudicator belongs, are important attributes of institutional independence [Rojer Mathew (supra)]. 31. The fundamental right to equality before law and equal protection of laws guaranteed by Article 14 of the Constitution, clearly includes a right to have the person s rights adjudicated by a forum which exercises judicial power in an impartial and independent manner [MBA-I]. 32. The constitutional mandate is that the legislature should adhere to the principles laid down in Part IV of the Constitution of India while enacting legislations. No provision shall be made in legislative acts which would have the tendency of making inroads into the judicial sphere. Any suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. The District Court allowed the writ petition. The Court of Appeal reversed the decision of the District Court which was affirmed by the United States Supreme Court in Cooper v. Aaron [358 U.S. 1 (1958)]. It was held therein that the constitutional rights of children not to be discriminated against in school admissions on grounds of race or color as declared by the United States Supreme Court in the Brown case can neither be nullified openly and directly by State legislators or state executives or judicial officers, nor nullified indirectly by them through evasive schemes for segregation. The Supreme Court declared that the principles announced in the decision of Brown v. Board of Education (supra) are indispensable for the protection of the freedoms guaranteed by the fundamental charter. 35. Chief Justice Warren speaking for the majority in Miranda v. Arizona [384 U.S. 436 (1966)], declared that a person in custody must, prior to interrogation, be clearly informed that he has the right to remain silent, and that anything he says will be used against him in a Court. He must be clearly informed that he has the right to consult with a lawyer and have the lawyer with him during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S. 211 (1995)] referred to earlier judgments of the United States Supreme Court which held that a judicial decision becomes the last word of the judicial department with regard to a particular case or controversy, and the Congress may not declare by retrospective action that the law applicable to that very case or a whole class of cases was something other than what the courts said it was. Justice Scalia held that depriving judicial judgments of the conclusive effect that they had when they were announced would be in violation of separation of powers. 37. In his article, The Case for the Legislative Override [Nicholas Stephanopoulos, The Case for the Legislative Override, 10 UCLA Journal of International Law and Foreign Affairs 250 (2005)], Nicholas Stephanopoulos has explored the response of Courts to legislative overruling in various jurisdictions. Judicial review of legislative action is limited in United Kingdom and New Zealand as the interpretation of statutes would be in accordance with the European Convention of Human Rights and the New Zealand Bill of Rights, respectively. The Courts in United Kingdom and New Zealand follow hortatory judicial review by which the Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titution of India [Binoy Vishwam v. Union of India Ors. (2017) 7 SCC 59]. Where there is challenge to the constitutional validity of a law enacted by the legislature, the Court must keep in view that there is always a presumption of constitutionality of an enactment and a clear transgression of constitutional principles must be shown. In State of Madhya Pradesh v. Rakesh Kohli Anr. [(2012) 6 SCC 312], this Court held that sans flagrant violation of the constitutional provisions, the law made by Parliament or a State legislature is not declared bad and legislative enactment can be struck down only on two grounds : (i) that the appropriate legislature does not have the competence to make the law, and (ii) that it takes away or abridges any of the fundamental rights enumerated in Part III of the Constitution or any other constitutional provisions. Subsequently, the Court has also recognised manifest arbitrariness as a ground under Article 14 on the basis of which a legislative enactment can be judicially reviewed [K.S. Puttaswamy Anr. v. Union of India Anr. (2019) 1 SCC 1]. (B) Permissible legislative overruling 40. The judgment in Shri Prithvi Cotton Mills Ltd. Anr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ach of the doctrine of separation of powers. 42. The judgment of this Court in Madan Mohan Pathak Anr. v. Union of India Ors. [(1978) 2 SCC 50] requires a close scrutiny as it was adverted to and relied upon by both sides. A writ petition was filed in the High Court of Calcutta for a mandamus directing the Life Insurance Corporation (LIC) to act in accordance with the terms of settlement dated 24-1-1974 read with administrative instructions dated 29-3-1974. The writ petition was allowed by the Learned Single Judge against which a Letters Patent Appeal (LPA) was preferred by the LIC. During the pendency of the LPA, the LIC (Modification of Settlement) Act, 1976 came into force. The LPA was withdrawn in view of the subsequent legislation and the decision of the Learned Single Judge became final. Validity of the said statute was assailed in a writ petition filed under Article 32 by the employees of the LIC. Justice Bhagwati, speaking for the majority, was of the opinion that the judgment of the Calcutta High Court was not a mere declaratory judgment holding an impost or tax as invalid so that a validating statute can remove the defect pointed out in the judgment. He observed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t aside an individual decision inter partes and therefore, amounted to a legislative exercise of judicial power. When a mandamus issued by the Mysore High Court was sought to be annulled by a legislation, this Court quashed the same in S.R. Bhagwat Ors. v. State of Mysore [(1995) 6 SCC 16] on the ground that it was impermissible legislative exercise. Setting at naught a decision of the Court without removing the defect pointed out in the judgment would sound the death knell of the rule of law. The rule of law would cease to have any meaning, because then it would be open to the Government to defy a law and yet to get away with it [P. Sambamurthy Ors. v. State of Andhra Pradesh Anr. (1987) 1 SCC 362]. 44. The permissibility of legislative override in this country should be in accordance with the principles laid down by this Court in the aforementioned as well as other judgments, which have been culled out as under : (a) The effect of the judgments of the Court can be nullified by a Legislative Act removing the basis of the judgment. Such law can be retrospective. Retrospective amendment should be reasonable and not arbitrary and must not be violative of the fundament ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctive wisdom of the Parliament cannot be interfered with by the Court. He emphasized that service conditions of Chairperson and Members of Tribunals is a matter of policy over which the Parliament should have the final word. He stressed the need for judicial restraint to be shown by courts in giving directions to legislate. He stated that any interstitial directions given by this Court in the absence of any existing legislation shall be treated as suggestions to the Parliament for consideration at the time of making legislation. He insisted that a later legislation cannot be struck down on the ground that the directions issued by the Court earlier are violated. Judicial review of the Ordinance can be only on those grounds that are available for review of a Legislative Act. The Ordinance cannot be declared as unconstitutional as being violative of Article 14, as no facet of the said Article comes into play in the instant case. 46. The grievance of the Petitioners in this Writ Petition mainly relates to the violation of the first proviso and the second proviso, read with the third proviso, to Section 184(1), Sections 184(7) and 184(11) of the Finance Act, 2017. Section 184(1) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conditions as may be provided by rules. (2) The Chairperson and Members of a Tribunal shall be appointed by the Central Government on the recommendation of a Search-cum-Selection Committee (hereinafter referred to as the Committee) constituted under sub-section (3), in such manner as the Central Government may, by rules, provide. (3) The Search-cum-Selection Committee shall consist of - (a) the Chief Justice of India or a Judge of Supreme Court nominated by him - Chairperson of the Committee; (b) two Secretaries nominated by the Government of India - Members; (c) one Member who - (i) in case of appointment of a Chairperson of a Tribunal, shall be the outgoing Chairperson of the Tribunal; or (ii) in case of appointment of a Member of a Tribunal, shall be the sitting Chairperson of the Tribunal; or (iii) in case of the Chairperson of the Tribunal seeking re appointment, shall be a retired Judge of the Supreme Court or a retired Chief Justice of a High Court nominated by the Chief Justice of India : Provided that, in the following cases, such Member shall always be a retired Judge of the Supreme Court or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions as a Member; or (e) has so abused his position as to render his continuance in office prejudicial to the public interest : Provided that where a Member is proposed to be removed on any ground specified in clauses (b) to (e), he shall be informed of the charges against him and given an opportunity of being heard in respect of those charges. Explanation. - For the purposes of this section, the expressions - (i) Tribunal means a Tribunal, Appellate Tribunal or Authority as specified in column (2) of the Eighth Schedule; (ii) Chairperson includes Chairperson, Chairman, President and Presiding Officer of a Tribunal; (iii) Member includes Vice-Chairman, Vice-Chairperson, Vice-President, Account Member, Administrative Member, Judicial Member, Expert Member, Law Member, Revenue Member and Technical Member, as the case may be, of a Tribunal; (11) Notwithstanding anything contained in any judgment, order, or decree of any Court or any law for the time being in force [With effect from 26-5-2017], - (i) the Chairperson of a Tribunal shall hold office for a term of four years or till he attains the age of sevent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eligible for appointment as Members in Tribunals. The experience of advocates at the bar and their specialization in the relevant branch of law was directed to be taken into account by the Search-cum-Selection Committee (hereinafter referred to as SCSC) while considering their appointment. Advocates were held to be entitled for reappointment for at least one term by giving preference to the service rendered by them in the Tribunals. Thereafter, an application was filed by the Union of India for modification of the direction aforementioned by substituting the word, eligible for reappointment in the place of entitled for reappointment . The said request of the Union of India was acceded to by this Court. 49. The direction given by this Court in the nature of mandamus in MBA-III is to the effect that advocates are entitled for appointment as Members, provided they have experience of 10 years. The first proviso to Section 184 which prescribes a minimum age of 50 years is an attempt to circumvent the direction issued in MBA-III striking down the experience requirement of 25 years at the bar for advocates to be eligible. Introduction of the first proviso to Section 184(1) is a dire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the Members, this Court in MBA-III directed enhancement of HRA to ₹ 1,25,000/- per month to the Members and ₹ 1,50,000/- per month to Chairperson or Vice-Chairperson or President of Tribunals. This direction was made effective from 1-1-2021. The Learned Amicus Curiae argued that the Union of India filed an application seeking modification of the HRA directed in the judgment. The clarification sought by the Union of India is to the effect that HRA payable to a Tribunal Member should not be a fixed amount and should, instead, be twice the HRA payable to the holder of a subsequent rank in the Government, e.g., Secretary to the Government. Miscellaneous Application No. 111 of 2021 filed by the Union of India is pending as this Court directed the Union of India to furnish details of the accommodation available for Chairpersons and Members of Tribunals and to submit a proposal as to what amount would be reasonable towards HRA in case accommodation cannot be provided to Members. The Learned Amicus Curiae contended that the result of the amendment is that Members of Tribunals working in Delhi will get ₹ 60,000/- as HRA. The second proviso to Section 184(1), read with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to Section 184(1) of the Finance Act, 2017, as amended by the Ordinance, we find that the amendment to Rule 15, made with retrospective effect from 1-1-2021, is in conformity with the directions of this Court on the subject of HRA in MBA-III. In view thereof, no further direction is required to be given with respect to HRA. 52. Rule 4(2) of the 2020 Rules pertains to the procedure to be followed by the SCSC. According to the said Rule, the SCSC should recommend two or three names for appointment to each post. A direction was given in MBA-III to amend Rule 4(2) of the 2020 Rules to provide that the SCSC shall recommend one person for appointment in each post in place of a panel of two or three persons for appointment to each post. One more name could be recommended to be included in the waiting list. Relying upon the earlier judgments of this Court in MBA-I, MBA-II and Rojer Mathew (supra), the Learned Amicus Curiae had submitted during the course of the hearing in MBA-III that the procedure for appointment to the Tribunal should be clearly outside executive control. The Learned Attorney General submitted in MBA-III that the number of candidates to be recommended by SCSC can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shed - (2014) 8 SCC 883; State v. Kalyan Singh Ors. - (2017) 7 SCC 444]. Sufficient reasons were given in MBA-III to hold that executive influence should be avoided in matters of appointments to Tribunals - therefore, the direction that only one person shall be recommended to each post. The decision of this Court in that regard is law laid down under Article 141 of the Constitution. The only way the legislature could nullify the said decision of this Court is by curing the defect in Rule 4(2). There is no such attempt made except to repeat the provision of Rule 4(2) of the 2020 Rules in the Ordinance amending the Finance Act, 2017. Ergo, Section 184(7) is unsustainable in law as it is an attempt to override the law laid down by this Court. Repeating the contents of Rule 4(2) of the 2020 Rules by placing them in Section 184(7) is an indirect method of intruding into judicial sphere which is proscribed. 54. The second part of Section 184(7) provides that the Government shall take a decision regarding the recommendations made by the SCSC preferably within a period of three months. This is in response to the direction given by this Court in MBA-III that the Government shall make a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at an early age can get more than one extension and continue till they reach the age of superannuation. After perusing the law laid down by this Court in MBA-I and Rojer Mathew (supra) which held that a short stint is anti-merit, we directed the modification of tenure in Rule 9(1) and 9(2) as five years in respect of Chairpersons and Members of Tribunals in MBA-III. This Court declared in para 53(iv) that the Chairperson, Vice-Chairperson and the Members of the Tribunals shall hold office for a term of five years and shall be eligible for reappointment. The insertion of Section 184(11) prescribing a term of four years for the Chairpersons and Members of Tribunals by giving retrospective effect to the provision from 26-5-2017 is clearly an attempt to override the declaration of law by this Court under Article 141 in MBA-III. Therefore, clauses (i) and (ii) of Section 184(11) are declared as void and unconstitutional. 56. The proviso to Section 184(11) refers to appointments that were made to the posts of Chairperson or Members between 26-5-2017 and the notified date, i.e., 4-4-2021. The proviso lays down that if the tenure of office or age of retirement specified in the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Section 184(11) is concerned, the Ordinance sets the maximum tenure at five years even with respect to the appointment orders passed between 26-5-2017 and 4-4-2021 provide for a higher tenure. In the process, interim directions given by this Court in Kudrat Sandhu (supra) are also nullified. It would be relevant to refer to the directions issued by this Court in Kudrat Sandhu (supra) on 9-2-2018. After taking the consent of the Learned Attorney General and making modifications incorporating his suggestions, this Court held that all selections to the post of Chairperson/Chairman, Judicial/Administrative Members shall be for a period as provided in the Act and the Rules in respect of all Tribunals. On 16-7-2018, this Court directed that persons selected as Members of ITAT can continue till the age of 62 years and persons who were holding the post of President till 65 years. By an order dated 21-8-2018, this Court clarified that a person selected as Member, CESTAT shall continue till the age of 62 years while a person holding the post of President can continue till the age of 65 years. Though, there is nothing wrong with the proviso to Section 184(11) being given retrospective effe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its relentless struggle in its endeavour to make Tribunals effective avenues of administration of justice. The endeavour of the Petitioner is to extricate the Tribunals from the clutches of the executive in the interest of independence of judiciary. Security of tenure, adequate remuneration and other conditions of service are necessary to ensure that Members of Tribunals would feel secure during their tenure. The judgment in MBA-III was passed after a detailed dialogue with the Learned Attorney General. Existence of large number of vacancies of Members and Chairpersons and the inordinate delay caused in filling them up has resulted in emasculation of the Tribunals. The main reason for tribunalisation, which is to provide speedy justice, is not achieved as Tribunals are wilting under the unbearable weight of the exploding docket. Undoubtedly, the legislature is free to exercise its power to make laws and the executive is the best judge to decide policy matters. However, it is high time that a serious effort is made by all concerned to ensure that all the vacancies in the Tribunals are filled up without delay. Access to justice and confidence of the litigant public in impartial just ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons. This is the essence of the power and function of judicial review that strengthens and promotes the rule of law [Ibid (Para 13)]. 65. It is also to be noted that the application of law by the Judges is not synonymous with the enactment of law by the legislature. Judges have the power to spell out how precisely the statute would apply in a particular case. In this manner, they complete the law formulated by the legislature by applying it. This power of interpretation or the power of judicial review is exercised post the enactment of law, which is then made subject-matter of interpretation or challenge before the Courts [Ibid (Para 25)]. 66. This Court has observed that if a law is enacted by the Parliament or Legislature, even if it is assumably contrary to the directions or guidelines issued by the Court, it cannot be struck down by reason of such directions/guidelines issued by the Court; it can be struck down only if it violates the fundamental rights or the right to equality under Article 14 of the Constitution [Ibid (Para 29)]. 67. A seven Judge Bench of this Court [P. Ramachandra Rao v. State of Karnataka, (2002) 4 SCC 578] held that the primary function of the ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 (Para 42)], it was held that the duty of judicial review bestowed upon the judiciary is not unfettered and it comes within the ambit of judicial restraint. The Parliament and Legislative Assemblies exercise sovereign power to enact law and no outside power or authority can issue a direction to enact a particular kind of legislation. 71. In a separate but concurring judgment in Kalpana Mehta authored by D.Y. Chandrachud, J., the Court held as under : 255. Parliament and the State Legislatures legislate. The executive frames policies and administers the law. The judiciary decides and adjudicates upon disputes in the course of which facts are proved and the law is applied. The distinction between the legislative function and judicial functions is enhanced by the basic structure doctrine. The legislature is constitutionally entrusted with the power to legislate. Courts are not entrusted with the power to enact law. Yet, in a constitutional democracy which is founded on the supremacy of the Constitution, it is an accepted principle of jurisprudence that the judiciary has the authority to test the validity of legislation. Legislation can be invalidated where the enacting legisla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cises his right of freedom of speech in violation, say, of Article 211, he would not be liable for any action in any court. Similarly, if the legislator by his speech or vote, is alleged to have violated any of the fundamental rights guaranteed by Part III of the Constitution in the Legislative Assembly, he would not be answerable for the said contravention in any court. If the impugned speech amounts to libel or becomes actionable or indictable under any other provision of the law, immunity has been conferred on him from any action in any court by this clause. He may be answerable to the House for such a speech and the Speaker may take appropriate action against him in respect of it; but that is another matter. It is plain that the Constitution-makers attached so much importance to the necessity of absolute freedom in debates within the legislative chambers that they thought it necessary to confer complete immunity on the legislators from any action in any court in respect of their speeches in the legislative chambers in the wide terms prescribed by clause (2). Thus, clause (1) confers freedom of speech on the legislators within the legislative chamber and clause (2) makes it plai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is supreme so as to enact a law falling within its legislative competence. The directions of the Court cannot compel the legislature to frame law in that particular manner only. The legislature while enacting laws can legislate in a manner which is not in accordance with the directions issued by the Court to the legislature, even if the Court has specially chosen to do so. The directions of this Court stop outside the four walls of legislature. The judiciary will step in only after a law is enacted to test the legality of a statue on the known principles of judicial review. The Judiciary cannot and should not usurp the powers vested with legislature. The Judiciary cannot legislate in the scheme of the constitution as propounded by many judgments including Larger Bench Judgments, which are binding on the smaller strength Benches. The directions of this Court in MBA-III are encroaching upon the field reserved for legislature. (ii) Whether a judgment has to be read in the context in which it was given and cannot be read as a statute, inter alia, in view of the principles that the Court while interpreting a provision cannot generally add word to a statute in view of doctrine of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein, nor what logically flows from the various observations made in the judgment. The said view has been relied upon by the Constitution Bench of this Court [Natural Resources Allocation, in Re, Special Reference No. 1 of 2012]. 76. This Court [Union of India v. Amrit Lal Manchanda Anr., (2004) 3 SCC 75 (Para 15)] also held that the observations of Courts are neither to be read as Euclid s theorems nor as provisions of the statute and that too taken out of their context. The observations must be read in the context in which they appear to have been stated. 77. This Court [Som Mittal v. Government of Karnataka, (2008) 3 SCC 574 (Para 9)] has observed that judgments are not to be construed as statutes. The words or phrases in judgments are not to be interpreted like provisions of a statute. The words in a judgment should be read and understood contextually and not intended to be taken literally. Su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation for amendment of any statutory Rule or even to direct an Act to be enforced, when the legislature has conferred such power on the executive. The directions of this Court in MBA-III were issued in the peculiar facts to make the Tribunal functional at the earliest rather than mandating legislature to amend the law in a particular manner. The legislature has a right to enact law, which may not be necessarily in terms of the directions of this Court. Such law when enacted by Parliament or the State Legislature, even if contrary to the directions or guidelines issued by the Court, cannot be struck down for the said reason. The legislation can be struck down if the basis of the provision interpreted by the Court is not altered or if it violates the fundamental rights or the right to equality under Article 14 of the Constitution. 81. The questions of law raised in MBA-III were in respect of separation of powers and independence of judiciary in the matter of constitution of Search and Selection Committee; appointment of persons without judicial experience as Judicial Members; failure to provide proper technical specialized expertise; failure to provide for adequate tenure of memb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Mathew (supra) were also governed by the parent Acts and Rules. Any appointments that were made after the 2020 Rules came into force i.e. on or after 12-2-2020 shall be governed by the 2020 Rules subject to the modifications directed in the preceding paragraphs of this judgment. (xii) xxx xxx (xiv) The terms and conditions relating to salary, benefits, allowances, house rent allowance etc. shall be in accordance with the terms indicated in, and directed by this judgment. (xv) The Chairpersons, Vice-Chairpersons and members of the Tribunals appointed prior to 12-2-2020 shall be governed by the parent statutes and Rules as per which they were appointed. The 2020 Rules shall be applicable with the modifications directed in the preceding paragraphs to those who were appointed after 12-2-2020. While reserving the matter for judgment on 9-10-2020, we extended the term of the Chairpersons, Vice-Chairpersons and members of the Tribunals till 31-12-2020. In view of the final judgment on the 2020 Rules, the retirements of the Chairpersons, Vice-Chairpersons and the members of the Tribunals shall be in accordance with the applicable Rules as mentioned abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntioned conclusions (c) and (d). In Cauvery Water Disputes Tribunal, the State of Karnataka promulgated Karnataka Cauvery Basin Irrigation Protection Ordinance, 1991 on 25-7-1991. In pursuance of the order passed by this Court in a writ petition, the Tribunal by way of an interim order directed the State of Karnataka to release water from its reservoirs to ensure 205 TMC is available in Tamil Nadu s Mettur reservoir in a year from June to May vide its order dated 25-6-1991. It is thereafter the Ordinance in dispute was promulgated. It is the said interim order which was sought to be nullified by enactment of the Ordinance, later substituted by an Act by the State of Karnataka. This Court held as under: 73. The Ordinance is unconstitutional because it affects the jurisdiction of the Tribunal appointed under the Central Act, viz., the Inter-State Water Disputes Act which legislation has been made under Article 262 of the Constitution. As has been pointed out above, while analysing the provisions of the Ordinance, its obvious purpose is to nullify the effect of the interim order passed by the Tribunal on June 25, 1991. The Ordinance makes no secret of the said fact and the written ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t open for the State Government to nulify the judgment/orders passed by the Kerala High Court or by this Court. It was not a case of removal of a defect in existing law. Various Constitution Bench decisions of this Court have settled the principles of law governing the field. It passes comprehension how the State Government has promulgated the Ordinance in question . (Emphasis Supplied) 87. In S.R. Bhagwat, the petitioners were senior in the final seniority list but their juniors got promoted on the basis of higher ranking in the provisional seniority list which was earlier operative. The writ petitions were allowed wherein the petitioners were directed to be considered for promotion. In implementation of the said judgment, the State granted deemed dates of promotions but denied the consequential monetary benefits. The petitioners filed contempt petitions before the High Court. It was at that stage that an Ordinance was promulgated whereby payment of actual financial benefits was sought to be taken away. The said judgment is clearly not applicable to the facts of present case as the defect was not even attempted to be cured. The legislative action was to deny financial benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt around the age of 35 years. The Memorandum of Procedure adopted by the Collegium of this Court prescribed forty-five years of age as the minimum age. I find that eligibility to seek appointment is not solely dependent upon qualification of a candidate but experience and suitability, likely term which a candidate may have are necessary considerations. The relevant part from the memorandum of the collegium is reproduced as under : 17. A person shall not be eligible to be considered for appointment as Judge of a High Court against Bar quota, unless he has completed 45 years of age on the date of recommendation by the High Court Collegium. 92. In terms of the Constitution read with the Memorandum of Procedure adopted by this Court, an advocate would have maximum tenure of 17 years as a Judge of the High Court, may be another three years as Judge of this Court. On the other hand, an advocate appointed as member of a Tribunal can have a tenure of 17 years, even if 50 is the minimum age for appointment. The tenure of such member is up to the age of 67 years with the possibility of being appointed as the Chairperson. This is not to compare the status of a High Court Judge with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be regarded as satisfying the essential requirements of an independent and impartial body exercising judicial functions of the State. xx xx xx 123. In the light of foregoing discussions it is declared that until the provisions in parts 1B and 1C of the Companies Act introduced by the Companies (Amendment) Act, 2002, which have been found to be defective inasmuch as they are in breach of the basic constitutional scheme of separation of powers and independence of the judicial function, are duly amended, by removing the defects that have been pointed out, it would be unconstitutional to constitute a Tribunal and Appellate Tribunal to exercise the jurisdiction now exercised by the High courts or the Company Law Board. 96. In an appeal against the said order, this Court in MBA-I noticed the contention of the Union as under : 11. The Union Government has accepted the finding and agreed to amend Sections 10FE and 10FT of the Act to provide for a five-year term for the Chairman/President/Members. However, the Government proposes to retain the provision for reappointment instead of renewal , as the reappointments would be considered by a Selection Committee whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that Sections 409(3)(a) and (e) are invalid as these provisions suffer from same vice. Likewise, Section 411(3) as worded, providing for qualifications of Technical Members, is also held to be invalid. For appointment of Technical Members to NCLT, directions contained in sub-paras (ii), (iii), (iv), (v) of para 120 of the 2010 judgment [(2010) 11 SCC 1] will have to be scrupulously followed and these corrections are required to be made in Section 409(3) to set right the defects contained therein. We order accordingly, while disposing of Issue 2. 100. In MBA-II, the age for appointment of members of the National Law Company Tribunal was fixed as fifty years. Same was not disputed by the present petitioner in the writ petition before the Madras High Court or before this Court. Therefore, the age of 50 years as the eligibility condition is not off the hat but is based upon previous legislation in respect of members of the National Company Law Tribunal. Thus, the fixation of fifty years of age as the eligibility condition cannot be said to be manifestly arbitrary or violative of any of the Fundamental Rights of any of the candidates which may render such condition of age as ille ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e saved by its being administered in a reasonable manner. The constitutional validity of the statute would have to be determined on the basis of its provisions and on the ambit of its operation as reasonably construed. If so judged it passes the test of reasonableness, possibility of the powers conferred being improperly used is no ground for pronouncing the law itself invalid and similarly if the law properly interpreted and tested in the light of the requirements set out in Part III of the Constitution does not pass the test it cannot be pronounced valid merely because it is administered in a manner which might not conflict with the constitutional requirements. 102. Similar view was reiterated by this Court in number of judgments [Government of Andhra Pradesh Anr. v. G. Jaya Prasad Rao Ors., (2007) 11 SCC 528; People s Union for Civil Liberties Anr. v. Union of India, (2004) 9 SCC 580; Charan Lal Sahu v. Union of India, (1990) 1 SCC 613]. In another judgment [Mehmood Alam Tariq Ors. v. State of Rajasthan Ors., (1988) 3 SCC 241], it was held as under : 24. ... It is also necessary to reiterate that a mere possibility of abuse of a provision, does not, by itself, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bers shall have option to avail of accommodation to be provided by the Central Government as per the rules for the time being in force or entitled to house rent allowance subject to a limit of Rs. one lakh twenty-five thousand rupees per month with effect from the 1st January, 2021. Therefore, the directions issued stands complied with. 106. As a matter of fact, there is a common grievance of the members of the Bar and the litigating parties other than from Delhi that there is a concentration of Tribunals in Delhi which deprives the advocates from other parts of the country to deal with the matters entrusted to the Tribunals. It is also expensive for the litigants to engage professional services in Delhi, which is out of capacity for a large section of the society. In fact, because of housing scarcity and expensive professional services, it will be open to the Government/legislature to shift the Principal Benches of the certain Tribunals outside Delhi so that concentration of Tribunals in Delhi is minimized which will in turn help the Bar to grow at different places, ensuring affordable administration of justice and resolution of the challenge of scarcity of housing in Delhi. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght the entire settlement relating to payment of annual cash bonus of Class III and Class IV employees and that too from April, 1 1975. Since the settlement had attained finality as the same was approved by the Board of Directors as well as by the Central Government, and that the Writ of Mandamus was issued by the Calcutta High Court to pay annual cash bonus to the employees, it was held that the judgment can be remedied by way of an appeal or review, but it cannot be disregarded or ignored and must be obeyed by Life Insurance Company. In S.S. Bola Ors. v. B.D. Sardana Ors. [(1997) 8 SCC 522], this Court explained the Judgment in Madan Mohan Pathak. It was found that inasmuch as six Hon ble Judges out of seven rested their decision on the ground that the impugned Act violates Article 31(2) of the Constitution and did not consider the enactment in question to be an act of usurpation of judicial power by the legislature. It was held as under : 189 .The majority judgment came to hold that the impugned Act is violative of Article 31 clause (2) as the effect of the Act was to transfer ownership debts due owing to Class III and Class IV employees in respect of annual cash bonu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he vice pointed out by the court. Equally, the observation of Chief Justice Beg is to be understood in the context that as long as the effect of mandamus issued by the court is not legaly and constitutionaly made ineffective, the State is bound to obey the directions. Thus understood, it is unexceptionable. But it does not mean that the Learned Chief Justice intended to lay down the law that mandamus issued by court cannot at all be made ineffective by a valid law made by the legislature, removing the defect pointed out by the court. (Emphasis supplied) 84. Madan Mohan Pathak [Madan Mohan Pathak v. Union of India, (1978) 2 SCC 50 : 1978 SCC (L S) 103] involved a situation where a parliamentary law was enacted to override a mandamus which was issued by the High Court for the payment of bonus under an industrial settlement. The case did not involve a situation where a law was held to be ultra vires and the basis of the declaration of invalidity of the law was sought to be cured. 112. Another judgment [State of Tamil Nadu v. State of Kerala, (2014) 12 SCC 696] which has been relied upon dealt with an inter se water dispute between two states relating to the height of Mullap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In light of the above legal position, if the 2006 judgment is seen, it becomes apparent that after considering the contentions of the parties and examining the reports of Expert Committee, this Court posed the issue for determination about the safety of the dam to increase the water level to 142 ft. and came to a categorical finding that the dam was safe for raising the water level to 142 ft. and, accordingly, in the concluding paragraph the Court disposed of the writ petition and the connected matters by permitting the water level of Mullaperiyar dam being raised to 142 ft. and also permitted further strengthening of the dam as per the report of the Expert Committee appointed by the CWC. The review petition filed against the said decision was dismissed by this Court on 27-7-2006. The 2006 judgment having become final and binding, the issues decided in the said proceedings definitely operate as res judicata in the suit filed under Article 131 of the Constitution. 113. Ram Pravesh Singh is another case where the State law was under consideration. It was not a case where the legislature had intervened to enact a law contrary to the directions given by the High Court. Similarly, K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty to fill up all or any of the vacancies. However, it does not mean that the State has the licence of acting in an arbitrary manner. The decision not to fill up the vacancies has to be taken bona fide for appropriate reasons. And if the vacancies or any of them are filled up, the State is bound to respect the comparative merit of the candidates, as reflected at the recruitment test, and no discrimination can be permitted. This correct position has been consistently followed by this Court, and we do not find any discordant note in the decisions in . 116. The fact that the legislation has intervened to prescribe a particular age which is at variance with the condition in the advertisement is a good reason not to appoint the candidates. The legality of Sections 174, 175 and 184 of the Finance Act, 2017 has been upheld in the matter of Rojer Mathew. Therefore, after such an amendment, appointments can be made only in terms of the Rules famed under Section 184 of the Finance Act. Now, some of the Rules stand substituted by the Ordinance. Therefore, candidates who have not been appointed will have to seek appointment only in terms of the substituted Section 184 of the Finance Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n implementation of decision in Hooda and Sandeep Singh s cases before passing of the impugned Act (ii) those, though not so appointed, who have judgments of High Court passed in their favour relying upon Hooda and Sandeep Singh s cases, and claim a right to appointment but would be deprived of it if the validity of the Act is upheld and on that basis the judgments of the High Court upturned and (iii) those, who would be covered by law laid down in Hooda s case on interpretation and applicability of the aforenoted two circulars. This Court held as under : 47. There is a distinction between encroachment on the judicial power and nullification of the effect of a judicial decision by changing the law retrospec tively. The former is outside the competence of the legislature but the latter is within its permissible limits {M/s. Tirath Ram Rajindra Nath, Lucknow v. State of U.P. Anr., [(1973) 3 SCC 585]}. The reason for this lies in the concept of separation of powers adopted by our constitutional scheme. The adjudication of the rights of the parties according to law is a judicial function. The legislature has to lay down the law prescribing norms of conduct which will govern parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le. 122. The candidates in question were appointed during the pendency of lis. These appointments were not concluded ap pointments but were subject to the provisions of the parent Act which has been amended by the Finance Act, 2017. They cannot claim any right to continue on the post till the age of retirement under the parent Act in terms of proviso to sub-section (11) of Section 184 of the Finance Act as substituted. The provisions of the parent Act cease to be in existence with the order passed in Rojer Mathew and subsequent legislative enactments introduced by way of the Ordinance. 123. Thus, I find that the first, second and third proviso to Section 184(1), the use of expression preferably in Section 184(7) and the proviso to Section 184(11) are legal and valid as such provisions fall within the exclusive domain of the legislature. The legislature has not nullified the judgment of this Court on the above aspects as there were no such corresponding provisions in the 2020 Rules, which were part of judicial review process. 124. It is open to the legislature to fix tenure of the Chairperson and the members other than four years as the tenure of four years was found to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s exclusively entitled to prescribe criteria for selection of Tribunal members, therefore, needs careful scrutiny. 127. The original constitution did not expressly - through any entry in the three legislative lists, deal with Tribunals. This field of legislation, creating Courts, was left to Parliament [Entries 77, 78 and 79, List I, Seventh Schedule to the Constitution of India] as well as the states [Entry 65, List II, Seventh Schedule to the Constitution of India]. The absence of an entry pertaining to Tribunals meant that the creation of administrative and quasi-judicial Tribunals, or offices and agencies conferred with quasi-judicial functions - was recognised as part of legislative activity, whereby laws could create appropriate bodies for their enforcement in exercise of incidental and ancillary powers adjunct to the concerned legislative head. As has been elaborated by L. Nageswara Rao, J., the Constitution (Forty Second) Amendment Act, 1976 introduced Articles 323A [Which enables setting up of Tribunals to adjudicate disputes with respect to recruitment and conditions of service of persons appointed to public services and posts in connection with the affairs of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the petitioners, but not exactly in the format suggested by the Learned Counsel. A closer examination of the judgments relied upon lead us to the conclusion, that in every new Constitution, which makes separate provisions for the legislature, the executive and the judiciary, it is taken as acknowledged/conceded that the basic principle of separation of powers would apply. And that, the three wings of governance would operate in their assigned domain/province. The power of discharging judicial functions which was exercised by members of the higher judiciary at the time when the Constitution came into force should ordinarily remain with the court, which exercised the said jurisdiction at the time of promulgation of the new Constitution. But the judicial power could be allowed to be exercised by an analogous/similar court/tribunal with a different name. However, by virtue of the constitutional convention while constituting the analogous court/tribunal it will have to be ensured that the appointment and security of tenure of Judges of that court would be the same as of the court sought to be substituted. This was the express conclusion drawn in Hinds case [Hinds v. R., 1977 AC 195 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower has been transferred. In recording our conclusions on the submission advanced as the first perspective, we may only state that our conclusion is exactly the same as was drawn by us while examining the petitioners previous submission, namely, that it is not possible for us to accept that under recognised constitutional conventions, judicial power vested in superior courts cannot be transferred to coordinate courts/tribunals. The answer is, that such transfer is permissible. But whenever there is such transfer, all conventions/customs/practices of the court sought to be replaced have to be incorporated in the court/tribunal created. The newly created court/tribunal would have to be established in consonance with the salient characteristics and standards of the court which is sought to be substituted. 130. Likewise, in Dr. D.C. Wadhwa Ors. v. State of Bihar Ors. [1987 (1) SCR 198], a Constitution Bench of this Court held that the power to promulgate an ordinance does not enable the executive to re-promulgate it several times, without seeking its enactment by the appropriate legislature. There is no provision in the constitution, which precludes the executive from re-prom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 67) 1 AC 259, 287-288] the compulsive, though inarticulate premise of these principles was elaborated in the following manner : What, however, is implicit in the very structure of a Constitution on the Westminster model is that judicial power, however it be distributed from time to time between various courts, is to continue to be vested in persons appointed to hold judicial office in the manner and on the terms laid down in the Chapter dealing with the judicature, even though this is not expressly stated in the Constitution. 133. In L. Chandra Kumar v. Union of India [1997 (3) SCC 261 = 1997 (92) E.L.T. 318 (S.C.)] this Court invalidated Section 28 of the Administrative Tribunals Act on the ground that it excluded jurisdiction under Articles 226 and 227, and was thus in conflict with the basic structure of the constitution, as judicial review was part of the basic structure : 100. In view of the reasoning adopted by us, we hold that Clause 2(d) of Article 323A and Clause 3(d) of Article 323B, to the extent they exclude the jurisdiction of the High Courts and the Supreme Court under Articles 226/227 and 32 of the Constitution, are unconstitutional. Section 28 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 97) 3 SCC 261 : 1997 SCC (L S) 577] has laid down that the power of judicial review over legislative action vested in the High Courts under Article 226 as well as in this Court under Article 32 of the Constitution is an integral and essential feature of the Constitution constituting part of its (sic basic) structure. The Constitution guarantees free and independent judiciary and the constitutional scheme of separation of powers can be easily and seriously undermined, if the legislatures were to divest the regular courts of their jurisdiction in all matters, and entrust the same to the newly created Tribunals which are not entitled to protection similar to the constitutional protection afforded to the regular courts. The independence and impartiality which are to be secured not only for the court but also for Tribunals and their members, though they do not belong to the judicial service but are entrusted with judicial powers. The safeguards which ensure independence and impartiality are not for promoting personal prestige of the functionary but for preserving and protecting the rights of the citizens and other persons who are subject to the jurisdiction of the Tribunal and for ens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion was prohibited by the Constitution. Madras Bar Association [(2015) 8 SCC 583] ( MBA-II ) considered the amended provisions of the Companies Act and proceeded to pronounce that many of them could not pass muster of the Constitution. Once again, as in R. Gandhi (supra), this Court was concerned with the likely impact on the nature of the justice delivery mechanism envisioned by the new law. The method of appointment, qualifications, eligibility conditions and tenure of all these fell within the undoubted domain of parliamentary concern. Yet, this Court held that many of these policy decisions enacted into law were contrary to the principle of an independent judiciary which could guarantee effective and impartial justice. Roger Mathew [(2020) 6 SCC 1 = 2019 (369) E.L.T. 3 (S.C.)] held that the rules framed under the Finance Act, 2017 ( the 2017 Rules ) were not sustainable due to defects in the constitution of selection cum appointment committees and tenure of members of Tribunals, among other aspects. Madras Bar Association v. Union of India [2020 SCC OnLine SC 962 = 2020 (374) E.L.T. 817 (S.C.)] ( MBA-III ) held that rules framed in 2020 were invalid as regards the tenure of me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the person deciding their causes is totally and completely free from the influence or pressure from the Govt. To maintain independence and impartiality it, is necessary that the personnel should have at least modicum of legal training, learning and experience. Selection of competent and proper people instil people s faith and trust in the office and help to build up reputation and acceptability. Judicial independence which is essential and imperative is secured and independent and impartial administration of justice is assured. Absence thereof only may get both law and procedure wronged and wrongheaded views of the facts and may likely to give rise to nursing grievance of injustice. Therefore, functional fitness, experience at the liar and aptitudinal approach are fundamental for efficient judicial adjudication. Then only as a repository of the confidence. as its duty, the tribunal would properly and efficiently interpret the law and apply the law to the given set of facts. Absence thereof would be repugnant or derogatory to the constitution. The daily practice in the courts not only gives training to Advocates to interpret the rules but also adopt the conventions of courts. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive or legislature in the past, when it concerned dispensation of justice through Courts, were the subject matter of scrutiny under judicial review by Courts. 141. In the exercise of such judicial review, in the past, this Court has ruled that High Courts have a decisive say in matters of recruitment, promotion and conditions of services of judges of District and other Courts, although the Constitution only requires the Governor to consult that institution (High Courts). In Chandra Mohan v. State of U.P. [1967 (1) SCR 77], this Court unanimously held : The exercise of the power of appointment by the Governor is conditioned by his consultation with the High Court, that is to say, he can only appoint a person to the post of District Judge in consultation with the High Court. The object of consultation is apparent. The High Court is expected to know better than the Governor in regard to the suitability or otherwise of a person, belonging either to the Judicial Service or to the Bar, to be appointed as a District Judge. Therefore, a duty is enjoined on the Governor to make the appointment in consultation with a body which is the appropriate authority to give advice to him .. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncial policies, or other areas such as energy, natural resources etc., this Court s standard of judicial review is deferential. In almost all subject matters over which legislative bodies enact law, the wisdom of the policy is rarely questioned; it is too well recognised that in such matters, judicial review extends to issues concerning liberties of citizens, and further, whether the particular subject matter falls within the legislative field of the concerned legislative body. In matters where the executive implements those laws, the scrutiny extends to further seeing the legality and constitutionality of such action. Where there is no law, the Court considers whether executive competence to act is traceable to the particular legislative field under the Constitution, and whether the executive action sans law, abridges people s liberties. Deference to matters executive appears to be highest, when the country faces emergencies and existential threats. However, in matters that concern administration of justice, especially where alternative adjudicatory forums are created, the Court s concern is greater. This is because the Constitution does not and cannot be read so as to provide two ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to be untenable, and directed it to be suitably amended. In response, as it were, for the first time, the 50-year minimum age requirement has been enacted in the parent enactment (Finance Act, 2017) through amendment by the impugned Ordinance. The justification given for this age requirement or qualification is threefold : (a) Advocate members, technical members (including chartered accountants) and those joining the Tribunal as departmental members would have a uniform age, which is relatable to the approximate age by which a public servant attains the status and rank of Additional Secretary, which enables consideration of her or his name for appointment as member of a Tribunal; (b) Considerations of equivalence with Additional Secretaries, weighed with the Union in enacting the age qualification; (c) Whether the minimum age of a Tribunal member ought to be 50 years, or less, is within the exclusive domain of the executive, and Parliament and cannot be dependent upon the views of this Court, being a pure policy issue. 145. The challenge to the first proviso to Section 184, which prescribes the age qualification, has to be seen from several angles. First ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng that in the span of a year (i.e. after the decision in Roger Mathew) new thinking seems to have prevailed to frame rules excluding advo cates who can otherwise, based on their expertise, be considered for appointment to even High Courts. 147. This Court would also observe that the consideration of such younger advocates in the age group of 40-45 years would have long term benefits since the domain knowledge and expertise in such areas (Telecom Regulation, Taxation-both Direct and Indirect, GATT Rules, International Taxation etc.) would be useful in adjudication in these Tribunals and lead to a body of jurisprudence. Depending on how such Counsel/advocates fare as members of the Tribunal, having regard to their special knowledge of these laws, at a later and appropriate stage, they may even be considered for appointment to High Courts. 148. The age criteria, impugned in this case also leads to wholly anomalous and absurd results. For instance, an advocate with 18 or 20-years practice, aged 44 years, with expertise in the field of indirect taxation, telecom, or other regulatory laws, would be conversant with the subject matter. Despite being eligible, (as she or he would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ential educational qualifications and experience in the relevant field are fixed for all candidates, for a classification based on minimum age for appointment (like in the present case) to succeed, the Union cannot say that it should be held to be valid, irrespective of the nature and purposes of the classification or the quality and extent of the difference in experience between candidates. As between someone with 18 years experience but aged 42 or 43 years, and someone with only 12 years experience, if a system of weightage for experience and qualification were to be applied, the one with greater experience would in all likelihood be selected. Then, to say that one with lesser experience, but who is more aged should be selected and appointed, not only eliminating the one with more experience, but even disqualifying her or him, would mean that better candidates have to be overlooked and those with lesser experience would be appointed, solely on the ground that the latter is over 50 years of age. Prime Minister Jawaharlal Nehru, in the course of the Constituent Assembly debates, (though in the context of fixing age of retirement of judges) remarked that [CAD, Vol. VIII dated 24th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e discrimination in regard to matters of employment. A recent US Supreme Court decision Baab v. Wilke [No. 18-882, 589 U. S. ___ (2020)] explained what is meant by age discrimination, in the following terms : The Civil Service Reform Act of 1978, which governs federal employment, broadly defines a personnel action to include most employment-related decisions, such as appointment, promotion, work assignment, compensation, and performance reviews. See 5 U.S.C. 2302(a)(2)(A). That interpretation is consistent with the term s meaning in general usage, and we assume that it has the same meaning under the ADEA. Under 633a(a), personnel actions must be made free from discrimination. The phrase free from means [c]lear of (something which is regarded as objectionable). Webster s Third New International Dictionary 905 (def. 4(a)(2)) (1976); 4 Oxford English Dictionary 521 (def. 12) (1933); see also American Heritage Dictionary 524 (def. 5(a)) (1969) (defining free used with from as [n]ot affected or restricted by a given condition or circumstance ); Random House Dictionary of the English Language 565 (def. 12) (1966) (defining free as exempt or released from something s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms of 633a(a), and it indicates that the statute does not require proof that an employment decision would have turned out differently if age had not been taken into account. (Emphasis supplied) 154. The Delhi High Court, in its decision reported as Commissioner, M.C.D. v. Shashi [(2009) 165 DLT 17] invalidated a rule that allowed the public employer to screen candidates based on their age, emphasizing that : Subject to constitutionally permissible reservations, every endeavour must be made by the State to employ or engage the most qualified or the most meritorious persons. In doing so, the State may fix shortlisting criteria on the basis of educational qualifications or experience or marks obtained in an examination or an interview or any other criterion which enables the most competent person to be selected. Unfortunately, age has nothing to do either with merit or competence. Wisdom may be an attribute of age, but not merit or competence. 13. There is not even an iota of material to suggest, nor indeed has anything been pointed out by Learned Counsel for the Petitioner, that merely because an applicant falls within the age group of 28 to 30 years he is better quali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all concerned appreciated that for the reasons pointed out above there cannot be any link between the service conditions of the Judges and those of the members of the other services. It is true that under Article 309 of the Constitution, the recruitment and conditions of service of the members of the subordinate judiciary are to be regulated by the Acts of the appropriate legislature and pending such legislation, the President and the Governor or their nominees, as the case may be, are empowered to make rules regulating their recruitment and the conditions of service. It is also true that after the Council of States makes the necessary declaration under Article 312, it is the Parliament which is empowered to create an All India Judicial Service which will include posts not inferior to the post of District Judge as defined under Article 236. However, this does not mean that while determining the service conditions of the members of the judiciary, a distinction should not be made between them and the members of the other services or that the service conditions of the members of all the services should be the same. As it is, even among the other services, a distinction is drawn in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... day interpretation of law, leading to adjudicatory outcomes. Such being the case, the equivalence of status of members of Tribunals cannot be compared in a linear or rigid manner. That according to the Union s scheme of rules and regulations, members of its services can attain a certain rank upon attaining the age of, say, 50 years, therefore, cannot be determinative. In any case, the argument of equivalence is not relevant. This point too, was brought home in the judgment of this Court, in All India Judges Association II (supra) : Unlike the administrative officer, the judicial officer is obliged to work for long hours at home. When he reserves a judgment he has usually to prepare the same at his residence. For that purpose, he has to read the records as also the judicial precedents cited by counsel for the adversaries. Even otherwise with a view to keeping himself up to date about the legal position he has to read judgments of his own High Court, other High Courts and of the Supreme Court. He has also to read legal journals. 159. There are other points of distinction too between civil servants and members of Tribunals. Members of Tribunals are not drawn from any c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up to the minimum threshold of the impugned criteria, i.e. 50 years of age. Purely as empirical data, the ITAT has a sanctioned strength of 126 members, (which includes accountant members, technical members - who are drawn from the Indian Revenue Service holding the rank of Commissioner of Appeals, for 3 years, and advocates). 66 members presently are in office, appointed since the year 1999 [https://itat.gov.in/page/content/ members (last accessed on 21-6-2021)]. Of these, 10 members were below the age of 40 at the time of their appointment; 20 members were between the ages of 40-45, and 15 members were between the ages of 46-50 - at the time of their respective appointments. Cumulatively, 44 members out of 66 were appointed below the age of 50. Only 17 members were 50 or above at the time of their appointment. Data is not provided in respect of 5 members. This data - as indeed similar data from other Tribunals, shows that past appointment to these positions was amongst younger, and competent persons. The Union has not shown why this past history requires departure, and why that longstanding basis for appointing younger professionals, now needs to be departed from, in public inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icted in any manner, by the impugned ordinance : Exclusion of Advocates in 10 out of 19 tribunals, for consideration as judicial members, is therefore, contrary to Union of India v. Madras Bar Association (2010) and Madras Bar Association v. Union of India (2015). However, it is left open to the Search-cum-Selection Committee to take into account in the experience of the Advocates at the bar and the specialization of the Advocates in the relevant branch of law while considering them for appointment as judicial members . After hearings were concluded, the directions in MBA-III on the above score, were accepted, and Advocates have now been made eligible, for appointment to 15 Tribunals, after they complete 10 years enrolment, and have relevant experience or in the concerned field of practice. 162. As a result of the above discussion, the proviso to Section 184(1), inserted by the impugned ordinance is declared void. A declaration is issued that all candidates, otherwise eligible on their merit, based on qualifications and experience in the relevant field, are entitled to be considered, without reference to the impugned minimum age (of 50 years) criteria. 163. I am in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that provision. But the date from which the rules are made to operate, must be shown to bear either from the face of the rules or by extrinsic evidence, reasonable nexus with the provisions contained in the rules, especially when the retrospective effect extends over a long period as in this case . Today s equals cannot be made unequal by saying that they were unequal twenty years ago and we will restore that position by making a law today and making it retrospective. Constitutional rights, constitutional obligations and constitutional consequences cannot be tempered with that way. A law which if made today would be plainly invalid as offending constitutional provisions in the context of the existing situation cannot become valid by being made retrospective. Past virtue (constitutional) cannot be made to wipe out present vice (constitutional) by making retrospective laws. We are, therefore, firmly of the view that the Gujarat Panchayats (Third Amendment) Act, 1978 is unconstitutional, as it offends Articles 311 and 14 and is arbitrary and unreasonable. 164. The impugned provision in the present case reads as follows : (11) Notwithstanding anything contained in any judgm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erm of five years can only be made for justifiable reasons and compliance with principles of natural justice for premature termination of the term of a Director of AIIMS squarely applied also to the case of the writ petitioner as well and will also apply to any future Director of AIIMS. Thus there was never any permissibility for any artificial and impermissible classification between the writ petitioner on the one hand and any future Director of AIIMS on the other when it relates to the premature termination of the term of office of the Director. Such an impermissible over classification through a one-man legislation clearly falls foul of Article 14 of the Constitution being an apparent case of naked discrimination in our democratic civilised society governed by the rule of law and renders the impugned proviso as void ab initio and unconstitutional. 37. Such being our discussion and conclusion, on the constitutionality of the proviso to Section 11(1A), we must, therefore, come to this conclusion without any hesitation in mind, that the instant case is squarely covered by the principles of law laid down by this Court in the various pronouncements as noted hereinabove including ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection Committee completes the selection process and makes its recommendations. The necessity to take action on this is emphasized by the nuts and bolts of the adjudicatory functions of Tribunals. As many as 21,259 cases were pending before the National Company Law Tribunal as on 31-12-2020, and 2278 cases were filed before the Tribunal under the Insolvency and Bankruptcy Code, 2016 during the period of April to December, 2020, out of which only 176 have been disposed so far [Available at https://economictimes.indiatimes.com/news/economy/policy/over-21250-cases-pending-before-nclt-at-end-of-december-2020/articleshow/80754041.cms?from=mdr (last accessed on 20-6-2021)]. As on April, 2021, the NCLT comprised of its Acting President and a total number of 38 members, out of which 17 are judicial members and 21 are technical members - much below than the sanctioned strength of 63 members [Available at https://www.indialegallive.com/top-news-of-the-day/news/ plea-in-sc-seeks-extension -of-tenure-of-nclt-members/ (last accessed on 20-6-2021)]. At the Armed Forces Tribunal, against a sanctioned strength of 34, only 11 members are currently in office - 4 judicial members and 6 administrativ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ardy-decision-making-piling-of-cases-at-recove-ry-tribunals-119032-300883 1.html (last accessed on 21-6-2021)]. As of April, 2020, the Railway Claims Tribunal had 25,571 pending cases [See https://indian-express.com/article/india/rct-judges-drag-govt-to-sc-cite-fundamental-righ-ts-to-seek-ex-tension-6380655/(last accessed on 21-6-2021)]. 168. The sheer volume of pendency is an indicator of the substantial judicial functions carried out by Tribunals, necessitating that they be manned by efficient, well qualified judicial and technical members. It is necessary that the Union expedite the process of appointments to Tribunals, towards ensuring swifter, and efficacious justice delivery. 169. As a postscript, one would only say that this judgment-seventh in the series commencing with R. Gandhi, hopefully should conclude all controversies. It would be erroneous on anyone s part to consider that interdiction by this Court amounts to conflict with Parliamentary or executive wisdom. Each judgment - when it interprets provisions relating to setting up of Tribunals and other arrangements for Tribunals, adds to the ongoing discourse between the three branches of governance. The Constituti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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