MADRAS BAR ASSOCIATION versus UNION OF INDIA AND ANR.
[2021] 5 S.C.R. 791, Supreme Court of India, 2021
Outcome: Disposed off
Segment: Body
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MADRAS BAR ASSOCIATION
v.
UNION OF INDIA AND ANR.
(W.P. (C)  502 of  2021)
JULY 14, 2021
[L. NAGESWARA RAO, HEMANT GUPTA AND
S. RAVINDRA BHAT, JJ.]
Tribunals – Finance Act, 2017 – ss.184 and 186(2) [as
amended by the Tribunal Reforms (Rationalisation and Conditions
of Service) Ordinance, 2021] – Tribunal Reforms (Rationalisation
and Conditions of Service) Ordinance, 2021 – ss.12 and 13 –
Appointment as Chairperson / Member of Tribunals – Procedure –
Conditions of service – Age qualification – Principles of separation
of powers – Independence of judiciary – Impermissibility of
legislative override – Challenge to first proviso and second proviso,
read with third proviso to s.184 (1) – Whether first proviso to s.184(1)
which stipulated that a person below the age of 50 years was not
eligible for appointment as Chairperson or Member was in violation
of the doctrine of separation of powers as the Supreme Court
judgment in MBA-III case [Madras Bar Association v. Union of
India & Anr., (2020) SCC Online SC 962] was frustrated by an
impermissible legislative override – Whether the second proviso,
read with the third proviso, which stipulated that allowances and
benefits payable to Chairpersons and Members was to be the same
as a Central Government officer holding a post carrying the same
pay, was an affront to the judgment in MBA-III case – Whether
s.184(7) which stipulated that the Selection Committee shall
recommend a panel of two names for appointment to post
of
Chairperson or Member and the Central Government shall take
decision preferably within three months from the date of the
recommendation of the Committee, was also an attempt to override
the law laid down in MBA-III case – Challenge to use of the
expression ‘preferably’ in s.184(7) – Insertion of s.184(11)
prescribing a term of four years for the Chairpersons and Members
of tribunals by giving retrospective effect to the provision was also
challenged – Held (per L. Nageswara Rao, J.) – The first proviso
and the second proviso, read with the third proviso, to s.184
[2021] 5 S.C.R. 791
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overriding the Supreme Court judgment in MBA-III case in respect
of fixing 50 years as minimum age for appointment and payment of
HRA, s.184(7) relating to recommendation of two names for each
post by the Search-cum-Selection Committee (SCSC) and further,
requiring the decision to be taken by the Government preferably
within three months are unconstitutional – s.184(11) prescribing
tenure of four years is contrary to principles of separation of powers,
independence of judiciary, rule of law and Art.14 of the Constitution
– Though, there is nothing wrong with the proviso to s.184(11) being
given retrospective effect, the appointments made pursuant to the
interim directions passed by the Court cannot be interfered with –
Held (per S. Ravindra Bhat, J.) (Concurring) – The first proviso and
the second proviso to s.184(1), as well as s.184(7) of the Finance
Act, 2017, are all void and inoperative – s.184(11)(i) and (ii) also
void and unconstitutional – Declaration of Supreme Court in MBA-
III case shall prevail and the term of Chairperson of a Tribunal
shall be five years or till she or he attains the age of 70 years,
whichever is earlier and the term of Member of a Tribunal shall be
five years or till she or he attains the age of 67 years, whichever is
earlier – Retrospectivity given to the proviso to s.184(11) upheld;
however, without affecting the appointments made to the post of
Chairperson or members of Tribunals, as
a consequence of Supreme
Court’s various orders during the interregnum period – Held (Hemant
Gupta, J.) (Partly dissenting) – The first, second and third proviso to
s.184(1), the use of expression ‘preferably’ in s.184(7) and the
proviso to s.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 Supreme Court on the above aspects as
there were no such corresponding provisions in the 2020 Rules,
which were part of judicial review process – 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 be not
tenable in MBA-III case – s.184(7) which contemplates that Select
Committee should recommend a panel of two names is however
contrary to directions of Supreme Court in MBA-III case –
s.184(11)(i)(ii) and s.184(7) are void as the Ordinance has reiterated
the provisions in 2020 Rules – Challenge to other provisions not
legally sustainable –Tribunal, Appellate Tribunal and other
Authorities (Qualifications, Experience and other Conditions of
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Service of Members) Rules, 2020 – Tribunal, Appellate Tribunal
and other Authorities (Qualifications, Experience and other
Conditions of Service of Members) (Amendment) Rules, 2021 –
Constitution of India – Arts. 14, 21 and 50.
Disposing the writ petition, the Court
HELD:
Per L. Nageswara Rao, J.
1. The permissibility of legislative override in this country
should be in accordance with the principles laid down by this Court,
which are 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
fundamental rights guaranteed under the Constitution.
b)  The test for determining the validity of a validating
legislation is that the judgment pointing out the defect would not
have been passed, if the altered position as sought to be brought
in by the validating statute existed before the Court at the time
of rendering its judgment.  In other words, the defect pointed
out should have been cured such that the basis of the judgement
pointing out the defect is removed.
c) Nullification of mandamus by an enactment would be
impermissible legislative exercise. Even interim directions cannot
be reversed by a legislative veto.
d)  Transgression of constitutional limitations and intrusion
into the judicial power by the legislature is violative of the
principle of separation of
powers, the rule of law and of Article 14
of the Constitution of India.[Para 44][844-C-G]
2. The direction given by this Court in the nature of
mandamus in Madras Bar Association v. Union of India & Anr.,
(2020) SCC Online SC 962 (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
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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
direct affront to the judgment of this Court in MBA-III. This Court
in Union of India v. R. Gandhi, President, Madras Bar Association,
(2010) 11 SCC 1 and Roger Mathew underlined the importance of
recruitment of Members from the bar at a young age to ensure a
longer tenure. Fixing a minimum age for recruitment of Members
as 50 years would act as a deterrent for competent advocates to
seek appointment. Practically, it would be difficult for an advocate
appointed after attaining the age of 50 years to resume legal
practice after completion of one term, in case he is not
reappointed. Security of tenure and conditions of service are
recognised as core components of independence of the judiciary.
Independence of the judiciary can be sustained only when the
incumbents are assured of fair and reasonable conditions of
service, which include adequate renumeration and security of
tenure. Therefore, the first proviso to Section 184(1) is in
violation of the doctrine of separation of powers as the judgment
of this Court in MBA-III has been frustrated by an impermissible
legislative override. Resultantly, the first proviso to Section 184
(1) is declared as unconstitutional as
it is violative of Article 14
of the Constitution. [Para 49][851-B-F]
3. The second proviso to Section 184(1) deals with the
allowances and benefits payable to the Members which are to be
the same as are admissible to a Central Government officer
holding a post carrying the same pay. The second proviso to
Section 184(1), read with the third proviso, is an affront to the
judgment of this Court in MBA-III. By no stretch of imagination
can it be said that the said provisos are a result of curative
legislation. The direction issued by this Court in MBA-III for
payment of HRA was to ensure that decent accommodation is
provided to Tribunal Members. Such direction was issued to
uphold independence of the judiciary and it cannot be subject
matter of legislative response. A mandamus issued by this Court
cannot be reversed by the legislature as it would amount to
impermissible legislative override. Therefore, the second
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proviso, read with the third proviso, to Section 184(1) is declared
as unconstitutional. [Para 50][851-G-H; 852-F-G]
4.1. Rule 4(2) of the Tribunal, Appellate Tribunal and other
Authorities (Qualifications, Experience and other Conditions of
Service of Members) Rules, 2020 pertains to the procedure to
be followed by the Search-cum-Selection Committee (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. 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. [Paras 52,
53][853-G-H; 855-A-C]
4.2. 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 appointments to
tribunals within three months from the completion of the selection
and recommendation by the SCSC. Such direction was
necessitated in view of the lethargy shown by the Union of India
in making appointments and filling up the posts of Chairpersons
and Members of tribunals which have been long vacant. The
direction given by this Court for expediting the process of
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appointment was in the larger interest of administration of justice
and to uphold the rule of law. Section 184(7) as amended by the
Ordinance permitting the Government to take a decision
preferably within three months from the date of recommendation
of the SCSC is invalid and unconstitutional, as this amended
provision simply seeks to negate the directions of this Court.
[Para 54][855-C-E, G; 856-A]
5. The tenure of the Chairperson and Member of a tribunal
is fixed at four years by Section 184(11), notwithstanding anything
contained in any judgment, order or decree of any court.  After
perusing the law laid down by this Court in Union of India v. R.
Gandhi, President, Madras Bar Association and Rojer Mathew which
held that a short stint is anti-merit, this Court directed the
modification of tenure in Rules 9(1) and 9(2) of the 2020 Rules as
five years in respect of Chairpersons and Members of tribunals
in MBA-III. This Court declared 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 26.05.2017 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. [Para 55][856-
A-B, D-F]
6. Insofar as the proviso to Section 184(11) is concerned,
the Ordinance sets the maximum tenure at five years even with
respect to the appointment orders passed between 26.05.2017
and 04.04.2021 provide for a higher tenure. In the process, interim
directions given by this Court in Kudrat Sandhu are also nullified.
Though, there is nothing wrong with the proviso to Section
184(11) being given retrospective effect, the appointments made
pursuant to the interim directions passed by this Court cannot
be interfered with. While making it clear that the appointments
that are made to the CESTAT on the basis of interim orders passed
by this Court shall be governed by the relevant statute and the
rules framed thereunder, as they existed prior to the Finance
Act, 2017, the retrospectivity given to the proviso to Section
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184 (11) is upheld. Further, all appointments after 04.04.2021
shall be governed by the Ordinance, as modified by the directions
contained herein. [Para 57][857-F-G; 858-B-C, D-F]
7. To conclude, the first proviso and the second proviso,
read with the third proviso, to Section 184 overriding the judgment
of this Court in MBA-III in respect of fixing 50 years as minimum
age for appointment and payment of HRA, Section 184(7) relating
to recommendation of two names for each post by the SCSC and
further, requiring the decision to be taken by the Government
preferably within three months are declared to be unconstitutional.
Section 184(11) prescribing tenure of four years is contrary to
the principles of separation of powers, independence of judiciary,
rule of law and Article 14 of the Constitution of India. Though,
the proviso to Section 184(11) has been upheld, the appointments
made to the CESTAT pursuant to the interim orders passed by
this Court shall be governed by the relevant statute and the rules
framed thereunder that existed prior to 26.05.2017. Notice has
been already taken of the notification dated 30.06.21 by way of
which Rule 15 of the 2020 Rules dealing with HRA has been
amended in conformity with directions in MBA-III. [Para 58][858-
F-H; 859-A]
S.R. Bhagwat & Ors. v. State of Mysore (1995) 6 SCC
16 : [1995] 3 Suppl. SCR 545; Cauvery Water Disputes
Tribunal (1983) 1 Suppl. SCC 96 : [1991] 2 Suppl.
 SCR 497; Medical Council of India v. State of
Kerala
& Ors. (2019) 13 SCC 185 : [2018] 10 SCR 213 and
Virender Singh Hooda & Ors. v. State of Haryana &
Anr. (2004) 12 SCC 588 : [2004] 5 Suppl. SCR 720 –
relied on.
Union of India v. R. Gandhi, President, Madras Bar
Association (2010) 11 SCC 1 : [2010] 6 SCR 857; Rojer
Mathew v. South Indian Bank Limited & Ors. (2020) 6
SCC 1 : [2019] 16 SCR 1; Madras Bar Association v.
Union of India & Anr. (2020) SCC Online SC 962;
Madras Bar Association v. Union of India & Anr. (2014)
10 SCC 1 : [2014] 10 SCR 1; S.P. Sampath Kumar v.
Union of India & Ors. (1987) 1 SCC 124 : [1987] 1
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SCR 435; Minerva Mills Ltd. & Ors. v. Union of India
& Ors. (1980) 3 SCC 625 : [1981] 1 SCR 206; L.
Chandra Kumar v. Union of India & Ors. (1997) 3 SCC
261 : [1997] 2 SCR 1186; Madras Bar Association v.
Union of India & Anr. (2015) 8 SCC 583 : [2015] 6
SCR 638; R.K. Jain v. Union of India (1993) 4 SCC
119 : [1993] 3 SCR  802; Gujarat Urja Vikas Nigam
Ltd. v. Essar Power Ltd. (2016) 9 SCC 103 : [2016] 5
SCR 101; Madras Bar Association v. Union of India &
Anr. (2020) SCC Online SC 962; Kudrat Sandhu v.
Union of India [2018] 10 SCR 956; Smt. Indira Nehru
Gandhi v. Shri Raj Narain (1975) Suppl. SCC 1 : [1976]
2 SCR 347; State of Tamil Nadu v. State of Kerala &
Anr. (2014) 12 SCC 696 : [2014] 12 SCR 875; I.R.
Coelho v. State of T.N. (2007) 2 SCC 1 : [2007] 1
SCR 706; Supreme Court Advocates-on-Record
Association & Ors. v. Union of India (1993) 4 SCC
441 : [1993] 2 Suppl. SCR 659; Union of India v.
Sankalchand Himatlal Sheth & Anr. (1977) 4 SCC 193
: [1978] 1 SCR 423; Supreme Court Advocates-on-
Record Association & Anr. v. Union of India (2016) 5
SCC 1 : [2015] 13 SCR 1; R.K. Garg v. Union of India
& Ors. (1981) 4 SCC 675 : [1982] 1 SCR 947;
T. Venkata Reddy & Ors. v. State of Andhra Pradesh
(1985) 3 SCC 198 : [1985] 3 SCR 509;  Krishna Kumar
Singh & Anr. v. State of Bihar & Ors. (2017) 3 SCC 1 :
[2017] 5 SCR 160; State of Madhya Pradesh v. Rakesh
Kohli & Anr. (2012) 6 SCC 312 : [2012] 6 SCR 661;
K.S. Puttaswamy & Anr. v.
Union of India & Anr. (2019)
1 SCC 1 : [2018] 8 SCR 1; Shri Prithvi Cotton Mills
Ltd. & Anr. v. Broach Borough Municipality & Ors.
(1969) 2 SCC 283 : [1970] 1 SCR 388; Patel
Gordhandas Hargovindas & Ors. v. Municipal
Commissioner, Ahmedabad & Anr. [1964] 2 SCR 608;
Janapada Sabha Chhindwara v. Central Provinces
Syndicate Ltd. & Anr. (1970) 1 SCC 509 : [1970] 3
SCR 745; I.N. Saksena v. State of Madhya Pradesh
(1976) 4 SCC 750 : [1976] 3 SCR 237; Indian
Aluminium Co. & Ors. v. State of Kerala & Ors. (1996)
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7 SCC 637 : [1996] 2 SCR 23; Bakhtawar Trust & Ors.
v. M. D. Narayan & Ors. (2003) 5 SCC 298 : [2003] 1
Suppl.  1 SCR; Madan Mohan Pathak & Anr. v. Union
of India & Ors. (1978) 2 SCC 50 : [1978] 3 SCR  334;
Sri Ranga Match Industries & Ors. v. Union of India &
Ors. (1994) 2 Suppl. SCC 726; A.V. Nachane & Anr. v.
Union of India & Anr. (1982) 1 SCC 205 : [1982] 2
SCR 246; Dr. Ashwani Kumar v. Union of India & Anr.
(2020) 13 SCC 585 : [2019] 12 SCR 30; Ram Pravesh
Singh & Ors. v. State of Bihar & Ors. (2006) 8 SCC
381 : [2006] 6 Suppl. SCR 512; Union of India &
Ors. v. Karnail Singh & Ors. (1995) 2 SCC 728 : [1994]
5 Suppl. SCR 584; State of Punjab & Ors. v. Rafiq
Masih (Whitewasher) (2014) 8 SCC 883 : [2014] 8
SCR 228 and State v. Kalyan Singh & Ors. (2017) 7
SCC 444 : [2017] 6 SCR 946 – referred to.
Marbury v. Madison 5 U.S. 137 (1803); United States
v. Peters 9 U.S. 115 (1809); Brown v. Board of
Education of Topeka 347 U.S. 483 (1954); Cooper v.
Aaron 384 U.S. 436 (1966); Miranda v. Arizona 384
U.S. 436 (1966); Dickerson v. United States 530 U.S.
428 (2000) and Plaut  v. Spendthrift Farm, Inc. 514
U.S. 211 (1995) – referred to.
Erwin Chemerinsky, The Court Should Have Remained
Silent: Why the Court Erred in Deciding Dickerson v.
United States, 149 Pennsylvania Law Review 287-308
(2001) and Nicholas Stephanopoulos, The Case for the
Legislative Override, 10 UCLA Journal of International
Law and Foreign Affairs 250 (2005) – referred to.
Per S. Ravindra Bhat,
J. (Concurring)
1. The challenge to the first proviso to Section 184, which
prescribes the age qualification, has to be seen from several
angles. First, the underlying parent statutes which created the
tribunals (ITAT, CESTAT, TDSAT, CAT) did not prescribe, as an
eligibility criterion for selection of candidates as members, any
minimum age. The prescription of 50 years as a minimum
eligibility criterion, in the opinion of this court, is without any
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rationale. The ITAT has existed for the last 79 years; no less
than 33 of its members were appointed as judges of various High
Courts; one of them (Ranganathan, J.) was appointed to this court.
The CESTAT 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. The Constitution of India
makes an advocate who has practiced for more than 10 years,
eligible for consideration for appointment as a judge of the High
Court and even this Court. An advocate with 7 years’ practice
with the Bar can be considered for appointment to the position of
a District Judge.  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). The exclusion of such eligible
candidates in preference to those who are more than 50 years of
age is inexplicable and therefore entirely arbitrary.  As this Court
in its previous judgment (Rojer Mathew) has pointed out in another
context, the exclusion of such young and energetic legal
practitioners could result in not so
efficient or competent
practitioners left in a field for consideration which would have
telling effects on the quality of decisions they are likely to render.
[Para 21][874-G-H; 875-A-E]
2. 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 (R. Gandhi –MBA –I; Madras Bar Association –III
and Roger Mathew). Such being the case, it is astonishing 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
advocates who can otherwise, based on their expertise, be
considered for appointment to even High Courts. [Para 22][875-
F-H]
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3. The consideration of 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. [Para 23][876-A-B]
4. 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 fulfil the parameters of at least 10
years’ practice, in the light of the decision in MBA-III) such a
candidate would be excluded. On the other hand, an individual
who might have practiced law for 10 years, and later served as a
private or public sector executive in an entirely unrelated field,
but who might be 50 years of age, would be considered eligible,
and can possibly secure appointment as a member of a tribunal.
Thus, the age criterion would result in filtering out candidates
with more relevant experience and qualifications, in preference
to those with lesser relevant experience, only on the ground of
age. [Para 24][876-C-E]
5.1. Given that the essential 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
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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. [Para 27][877-D-G]
5.2. In the present case, the rule has the effect of excluding
deserving candidates, without subserving any discernible public
policy or goal. Thus, the classification is based on no justifiable
rationale; nor can it be said that the age criterion has some nexus
with the object sought to be achieved, such as greater efficiency
or experience. [Para 27][878-B]
5.3. The qualification of a minimum age of 50 years as
essential for appointment, is discriminatory because it is neither
shown to have a rational nexus with the object sought to be
achieved, i.e. appointing the most meritorious candidates; nor is
it shown to be based on any empirical study or data that such
older candidates fare better, or that younger candidates with more
relevant experience would not be as good, as members of
tribunals. It is plain and simple, discrimination based on age. The
criterion (of minimum 50 years of age) is virtually “picked out
from a hat” and wholly arbitrary. [Para 31][881-G-H; 882-A-B]
6.1. The tribunals which were reorganized by the Finance
Act, 2017 and now, through the impugned ordinance, exercise
judicial functions of the State,
interpret and enforce the law, in
the course of adjudication of disputes. The appointment of
members (of such tribunals), their conditions of service, manner
of selection, remuneration and security of tenure are vital to their
efficiency and independent functioning. It is in this backdrop that
the Union’s contention regarding “equivalence” or “parity” with
members of the civil services of the Union or holders of civil
posts under the Union, as a justification for the age criterion,
needs to be examined. In addition, it is worthwhile to recollect
that a civil servant’s experience, though varied and diverse –
ranging from co-ordination and administration at taluk, district
and state levels, to devising, framing and implementing the
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government’s policies and programmes, to managing statutory
corporations and even commercial enterprises of the state, does
not always entail adjudicatory functions. However, legal
practitioners, chartered accountants and one segment of civil
servants, i.e. tax administrators and adjudicators are involved in
the day to 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. [Paras 32, 34][882-
B-D; 884-A-D]
6.2. There are other points of distinction too between civil
servants and members of tribunals. Members of tribunals are
not drawn from any civil service; they are not holders of civil
posts. Civil servants, especially members of the All-India Services
recruited by the Union, some of whom are deployed to different
States, are governed by rules and other service conditions
embodied in circulars and orders. These govern their entire
universe of employment: starting with eligibility conditions, rules
for recruitment and selection, pay and allowances, seniority,
promotion, discipline and
other matters related to misconduct,
pension, terminal benefits etc. On the other hand, such rules or
similar rules do not apply to members of tribunals not drawn from
public service. It is only conditions of equivalence such as pay
scale which they are assured of under the rules, which also
determine their status. 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. 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
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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. The
Union’s argument that 50 years is necessary as it brings about
parity between the members of the civil services who are eligible
to be considered in their stream for tribunals or that there is an
overall uniformity, is without merit and accordingly rejected. [Para
35][884-F-H; 885-A-C; 886-F]
7. 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. [Para 38][888-C]
8. The interim directions of this court, which culminated
and were subsumed in Roger Mathew, resulted in the appointment
of members of various tribunals, whose term is now sought to be
interdicted by the proviso to Section 184 (11), which has been
introduced with retrospective effect. While the retrospectivity
accorded to this provision cannot be faulted, nevertheless, the
said proviso, to the extent it seeks to interfere with and curtail
the tenure of members appointed under interim orders, who are
entitled to enjoy their term
of office, in accordance with the pre-
amended legislation and rules, is arbitrary and void. [Para 41][890-
D-F]
9. The curtailment of tenure to five years, of the few
individuals appointed as members of tribunals, who were entitled
to continue in office in terms of the pre-existing enactments (upto
the age of 62 years etc.) is arbitrary. Apart from the fact that the
Union wishes to curtail their tenure despite the finality of
directions of this court in Roger Mathew and MBA-III, there is no
conceivable rationale. Nor has any overriding public interest been
espoused as a justification for this. The divesting of judicial office
by legislative fiat, in this court’s opinion, directly affects the
independence of the judiciary. It also amounts to naked
discrimination, because all other members of the same tribunals
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would enjoy longer tenure, in terms of the pre-existing conditions
of service, which prevailed at the time of their appointment. [Para
42][892-B-E]
10. It is concluded and held as follows:
(i) The first proviso to Section 184(1) of the Finance Act,
2017, introduced by Section 12 of the Tribunals Reforms
(Rationalisation and Conditions of Service) Ordinance, 2021 is
hereby declared void and inoperative. Similarly, the second
proviso to Section 184(1) of the Finance Act, 2017, introduced
by Section 12 of the Tribunals Reforms (Rationalisation and
Conditions of Service) Ordinance, 2021 is held to be void and
inoperative.
(ii) Section 184(7)  of the Finance Act, 2017 introduced by
Section 12 of the Tribunals Reforms (Rationalisation and
Conditions of Service) Ordinance, 2021 is hereby declared void
and inoperative.
(iii) Section 184(11)(i) and (ii) introduced by Section 12 of
the Tribunals (Reforms Rationalisation and Conditions of Service)
Ordinance, 2021 are hereby declared as void and unconstitutional.
(iv) Consequently, the declaration of this Court in para
53(iv) of MBA-III shall prevail and the term of Chairperson of a
Tribunal shall be five years or till she or he attains the age of 70
years, whichever is earlier and the term of Member of a Tribunal
shall be five years or till she or he attains the age of 67 years,
whichever is earlier.
(v) The retrospectivity given to the proviso to Section
184(11) – introduced by Section 12 of the Tribunals (Reforms
Rationalisation and Conditions of Service) Ordinance, 2021 is
hereby upheld; however, without in any manner affecting the
appointments made to the post of Chairperson or members of
various Tribunals, upto 04.04.2021. In other words, the
retrospectivity of the provision shall not in any manner affect the
tenures of the incumbents appointed as a consequence of this
Court’s various orders during the interregnum period. [Para
46][894-F-G; 895-A-E]
State of Gujarat v. Raman Lal Keshav Lal Soni (1983)
2 SCC 33 : [1983] 2 SCR 287 – followed.
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State of J&K v. Triloki Nath Khosa (1974) 1 SCC 19 :
[1974] 1 SCR 771; Mohd. Shujat Ali v. Union of India
(1975) 3 SCC 76 : [1975] 1 SCR 449; Anuj Garg v.
Hotel Assn. of India (2008) 3 SCC 1 : [2007] 12
SCR 991 and All India Judges’ Assn. (II) v. Union of
India (1993) 4 SCC 288 : [1993] 1 Suppl. SCR 749 –
relied on.
Union of India v. R. Gandhi, President, Madras Bar
Association (2010) 11 SCC 1 : [2010] 6 SCR 857;
Madras Bar Association v. Union of India (2014) 10
SCC 1 : [2014] 10 SCR 1; Roger Mathew (2020) 6
SCC 1 : [2019] 16 SCR 1; Madras Bar Association v
Union of India (2020) SCC Online (SC) 962 (MBA-
III); Dr. D.C. Wadhwa & Ors. v. State of Bihar & Ors.
[1987] 1 SCR 198; Krishna Kumar Singh v. State of
Bihar (2017) 3 SCC 1 : [2017] 5 SCR 160;
Kesavananda Bharati v. State of Kerala [1973] 1 Suppl.
SCR; L. Chandra Kumar v Union of India (1997) 3
SCC 261 : [1997] 2 SCR 1186; Ismail Faruqui v. Union
of India (1994) 6 SCC 360 : [1994] 5 Suppl. SCR 1;
Pareena Swarup v. Union of India (2008) 14 SCC 107
: [2008] 13 SCR 1217; S.P. Sampath Kumar v. Union
of India & Ors. (1987) SCC Suppl. 734 : [1987] 3
SCR 233; Madras Bar Association (2015) 8 SCC 583
: [2015] 6 SCR 638; R.K. Jain v. Union of India [1993]
3 SCR 802; Chandra Mohan v. State of U.P [1967] 1
SCR 77; Chandramouleshwar Prasad v. Patna High
Court (1969) 3 SCC 56 : [1970] 2 SCR 666; State of
Kerala v. A. Lakshmikutty and Ors. [1987] 1 SCR 136;
State of Bihar v. Bal
Mukund Sah (2004) 4 SCC 640;
Lt. Col. Nitisha & Ors. v. Union of India (2021) SCC
OnLine SC 261; Commissioner, M.C.D. v. Shashi (2009)
165 DLT 17 and P. Venugopal v. Union of India (2008)
5 SCC 1 : [2008] 8 SCR 1 – referred to.
Liyanage v. The Queen [1967] 1 AC 259, 287–288;
Smith v. City of Jackson 544 US 228 (2005) and Baab
v. Wilke No. 18-882, 589 U. S. – referred to.
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Per Hemant Gupta, J. (Partly dissenting)
1. The views expressed in the detailed judgment authored
by Justice L. Nageswara Rao as also separate but concurring
judgment of Justice Ravindra Bhat, are not agreed with, except
to the limited extent that part of Section 187(7) of the
Tribunals Reforms (Rationalisation and Conditions of Service)
Ordinance, 2021 that the Search and Selection Committee shall
recommend two names for a post and that the tenure of members
including Chairperson etc. shall be four years in terms of Clauses
(i) and (ii) of Section 184 (11) of the Ordinance is illegal since the
issues of constitution of panel and tenure have already been
decided in MBA-III case and that without removing such defect,
the Ordinance could not be enacted. [Para 1][895-F-H]
2. The judiciary in exercise of power of judicial review can
strike down any legislation which violates fundamental rights or
if it is beyond the legislative competence but the courts cannot
direct the legislature to frame or enact a law and in a particular
manner. The law declared by the Supreme Court is binding on all
Courts in India in terms of Article 141 of the Constitution. The
directions issued under Article 142 of the Constitution, are
binding on every Court in terms of Article 141 of the Constitution.
The legislature cannot be said to be Court within the meaning of
Article 141 of the Constitution by any stretch of imagination. 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 statute 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. The directions of this Court in MBA-III case
are encroaching upon the field reserved for legislature. [Para
13][900-E-G; 901-A-C]
3. The Court will not direct to the State or Union to enact
any particular law, or amend/ issue any notification 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 case were issued in the
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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. Though transgression of
constitutional limitations and intrusion into the judicial power by
the legislature is violative of the principle of separation of powers,
the rule of law and of Article 14 of the Constitution of India, but it
is equally true that judiciary in exercise of power of judicial review
cannot direct legislature to frame any law in a particular manner.
[Paras 20, 29][904-A-C; 909-E]
4. It cannot be said that the first proviso to Section 184
prescribing a minimum age of fifty years is an attempt to
circumvent the direction issued in MBA-III case. The condition
of eligibility for appointment as a Judge of a High Court was kept
in view while considering the eligibility of advocates as members
of Tribunals. However, the Memorandum of Procedure for
appointment as judges of the High Court finalized by this Court
and forwarded to the Central Government in March, 2017 was
that a person shall not be eligible to be considered for appointment
as Judge of a High Court against Bar quota unless he
has
completed forty-five years of age on the date of recommendation
by the High Court Collegium. Though, in terms of Article 217 of
the Constitution, a candidate becomes eligible for appointment
after 10 years of practice as an Advocate. Thus, an Advocate would
be eligible for appointment as judge of the High Court 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. The 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. [Para 31][909-G-H; 910-A-D]
5. 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
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809
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 that of a member
of a Tribunal. The members would be appointed on the basis of
recommendation of the high-powered Search and Selection
Committee having judicial dominance. If a member is discharging
his functions legally, there is no need to bear any apprehension
about his not being re-appointed. The process of re-appointment
is again with the High-Powered Search and Selection Committee
with judicial dominance. A provision in the statute cannot be found
to be untenable merely for the reason that there is a possibility
of not being re-appointed. [Para 32][910-E-G]
6. The advocates were not eligible for appointment under
2020 Rules. Therefore, there was no condition of age of eligibility
of such candidates. The discussions in the judgment are not to
be considered as directions. There is background in which the
ultimate directions are issued. Since no directions were issued
in respect of eligibility conditions particularly relating to age, thus,
fixing of eligible age as fifty years cannot be treated to be in
contradiction to the directions issued in MBA-III case. Even if it
is contravening to any
such direction, the legislature is within its
jurisdiction to determine the minimum eligibility age for the
purpose of appointment. [Paras 33, 34][910-H; 911-A-C]
7. 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 illegal. The argument is based on
apprehension that it would be difficult for an advocate appointed
after attaining the age of fifty years to resume legal practice after
completion of one term, in case he is not reappointed. A person
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who is competent and good in his work will not find any difficulty
to resume his practice but what would happen to his professional
career if his term is not extended is a calculated risk which a
candidate shall take at the time of seeking appointment. Such
apprehensions as to what will happen in future cannot be a ground
to strike down a condition of age in the statute. This Court is not
possessed of the expertise to say that it will be difficult for an
advocate to resume practice if he is not reappointed. The statutory
provisions cannot be struck down on such grounds based on
presumed apprehensions. [Para 40][913-E-H; 914-A]
8. The apprehensions or misuse of a statutory provision is
not a ground to declare the provisions of a statute as void. In
case of failing to secure reappointment, the candidate will not be
able to resume practice is based upon apprehensions. Whether
they are good or valid grounds to refuse reappointment can be
subject matter of judicial review although the decision of the high-
power Search and Selection Committee not to re-appoint a
candidate may not warrant interference in exercise of judicial
review. [Paras 41, 43][914-A-B; 915-D-E]
9. The second proviso is to the effect that allowances and
benefits shall be to the extent as are admissible to a Central
Government officer holding the post carrying the same pay. The
third proviso to Section 184(1) is that where Chairperson or
Members take a
house on rent, he may be reimbursed a house
rent subject to such limits and conditions as may be prescribed.
In terms of third proviso, the Tribunal, Appellate Tribunal and
other Authorities (Qualifications, Experience and other
Conditions of Service of Members) (Amendment) Rules, 2021
have been published. As per the Rules now notified, the
Chairman, Chairperson, President, Vice Chairman, Vice
Chairperson or Vice President 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 fifty thousand rupees
per month and the Members 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
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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. [Para
45][916-A-D]
10. The direction of this Court was that the Union shall
make appointments to Tribunals within three months whereas
the Ordinance has used the expression that the Central
Government shall take a decision on the recommendations of
the Committee “preferably within three months”. Both the
directions are only directory. It is well-settled that the use of
expression ‘shall’ or ‘may’ is not determinative of the fact that
whether the condition is mandatory or directory. Therefore, there
is no reason to set aside the expression ‘preferably’ used in sub-
section (7) of Section 184. Such directions were issued in terms
of Article 142 of the Constitution which stop at the four walls of
the Parliament.  The language to be used falls within the legislative
competence and do not violate any fundamental right nor can be
said to be manifestly arbitrary. [Para 47][916-G-H; 917-A-B]
11. The inserted proviso to Section 184(11) by the
Ordinance deals with two situations. One is in respect of the
candidates appointed from 26.5.2017 till the notified date that is
4.4.2021 in terms of sub-Section (11) of Section 184. Second is in
respect of the candidates who have not been appointed falling
within proviso to sub-Section (1) of Section 184, which provides
that a person who has not
completed the age of fifty years shall
not be eligible for appointment as a Chairperson or Member.
There is no doubt that this is a prospective provision as no
candidate who has not completed 50 years of age is eligible to
seek appointment. There is no merit in the argument that a
selected candidate has a right to seek appointment and that too
within three months of the order of this Court. Firstly, a selected
candidate has no right to seek appointment. The successful
candidates do not acquire an indefeasible right to be appointed
which cannot be legitimately denied. 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
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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. The candidates who
were selected cannot seek appointment on the basis of their old
selection and being in merit. [Paras 54, 55, 56][921-G-H; 922-A-
C; F-H]
12.1. Some of the Chairpersons and Members of the
Tribunals were appointed between 26.5.2017 to 4.4.2021 in terms
of the interim orders passed by this Court. The interim order
which permitted the appointments now stands subsumed in the
Ordinance which has defined the tenure and the terms and
conditions of appointment. The Ordinance is in fact in terms of
the liberty granted to Union to seek modification. Mere fact that
an application for modification is pending will not bar the
legislature to enact a statute by way of an Ordinance. The
appointments made after 26.5.2017 by virtue of Section 184(11)
will be governed not by the parent statute but by the terms and
conditions as enumerated in the Ordinance. The consent of the
Attorney General will not act as an estoppel against the statute
i.e. the Ordinance. [Paras 57, 58][923-A, D-E]
12.2. The candidates in question
were appointed during the
pendency of lis. These appointments were not concluded
appointments 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. [Para 62][925-
D-F]
13.1. The first, second and third proviso to Section 184(1),
the use of expression ‘preferably’ in Section 184(7) and the proviso
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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. [Para 63][925-F-G]
13.2. 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 be not tenable in MBA-III. Section
184(7) which contemplates that Select Committee should
recommend a panel of two names is contrary to the directions of
this Court in MBA-III. Thus, Section 184(11)(i)(ii) and Section
184(7) is declared to be void as the Ordinance has reiterated the
provisions which were in 2020 Rules. The challenge to other
provisions is not legally sustainable. [Para 64][925-G-H; 926-A]
S.R. Bhagwat & Ors. v. State of Mysore (1995) 6 SCC
16 : [1995] 3 Suppl. SCR 545; Cauvery Water Disputes
Tribunal (1983) 1 Suppl. SCC 96 : [1991] 2 Suppl.
 SCR 497; Medical Council of India v. State of Kerala
& Ors. (2019) 13 SCC 185 : [2018] 10 SCR 213 and
Virender Singh Hooda & Ors. v. State of Haryana &
Anr. (2004) 12 SCC 588 : [2004] 5 Suppl.  SCR 720 –
distinguished.
P. Ramachandra Rao v. State of Karnataka (2002) 4
SCC 578; A.K. Roy v. Union of India & Ors., (1982) 1
SCC 271 : [1982] 2 SCR 272; Kalpana Mehta & Ors,
v. Union of India & Ors. (2018) 7 SCC 1 : [2018] 4
SCR 1; Powers,
Privileges and Immunities of State
Legislatures, AIR 1965 SC 745; Padma Sundara Rao
(Dead) & Ors. v. State of T.N. & Ors., (2002) 3 SCC
533 : [2002] 2 SCR 383 and Natural Resources
Allocation, in Re, Special Reference No. 1 of 2012 –
followed.
Dr. Ashwani Kumar v. Union of India & Anr. (2020) 13
SCC 585 : [2019] 12 SCR 30; Mangalam Organics
Limited v. Union of India, (2017) 7 SCC 221 : [2017] 5
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SCR 406; State of Orissa & Ors. v. Md. Illiyas (2006)
1 SCC 275 : [2005] 5 Suppl. SCR 395; Union of India
v. Amrit Lal Manchanda & Anr., (2004) 3 SCC 75 :
[2004] 2 SCR 422; Som Mittal v. Government of
Karnataka, (2008) 3 SCC 574 : [2008] 3 SCR 130;
Arasmeta Captive Power Company Private Limited &
Anr. v. Lafarge India Private Limited, (2013) 15 SCC
414 : [2013] 17 SCR 496; Shanti Bhushan v. Supreme
Court of India & Anr., (2018) 8 SCC 396 : [2018] 12
SCR 972 and M.C. Mehta v. Kamal Nath & Ors., (2000)
6 SCC 213 : [2000] 1 Suppl. SCR  389 – relied on.
Union of India v. R. Gandhi, President, Madras Bar
Association (2010) 11 SCC 1 : [2010] 6 SCR 857; Rojer
Mathew v. South Indian Bank Limited & Ors. (2020) 6
SCC 1 : [2019] 16 SCR 1; Madras Bar Association v.
Union of India & Anr. (2020) SCC Online SC 962;
Madras Bar Association v. Union of India & Anr. (2015)
8 SCC 583 : [2015] 6 SCR 638; Collector of Customs,
Madras & Anr. v. Nathella Sampathu Chetty & Anr. AIR
1962 SC 316 : [1962] 3 SCR 786; Government of
Andhra Pradesh & Anr. v. G. Jaya Prasad Rao & Ors.,
(2007) 11 SCC 528 : [2007] 4 SCR 256; People’s Union
for Civil Liberties & Anr. v. Union of India (2004) 9
SCC 580 : [2003] 6 Suppl. SCR 860; Charan Lal Sahu
v. Union of India, (1990) 1 SCC 613 : [1989] 2 Suppl.
 SCR 597; Mehmood Alam Tariq & Ors. v. State of
Rajasthan & Ors. (1988) 3 SCC 241 : [1988] 1 Suppl.
SCR 379; Shri Prithvi Cotton Mills Ltd. & Anr. v. Broach
Borough Municipality & Ors. (1969) 2 SCC 283 :
[1970] 1 SCR 388; Madan Mohan Pathak & Anr. v.
Union of India & Ors., (1978) 2 SCC 50 : [1978] 3
SCR 334; S.S. Bola & Ors. v. B.D. Sardana & Ors.
(1997) 8 SCC 522 : [1997] 2 Suppl. SCR 507; B.K.
Pavitra v. Union of India (2019) 16 SCC 129 : [2019]
7  SCR 1086; State of Tamil Nadu v. State of Kerala
(2014) 12 SCC 696 : [2014] 12 SCR 875; Mullaperiyar
Environmental Protection Forum v. Union of India,
(2006) 3 SCC 643 : [2006] 2 SCR 740 and Shankarsan
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Dash v. Union of India (1991) 3 SCC 47 : [1991] 2
SCR 567 – referred to.
Case Law Reference
In the judgment of L. Nageswara Rao, J.
[2010] 6 SCR 857
referred to
Para 1
[2014] 10 SCR 1
referred to
Para 1
[2019] 16 SCR 1
referred to
Para 1
[1987] 1 SCR 435
referred to
Para 3
[1981] 1 SCR 206  
referred to
Para 3
[1997] 2 SCR 1186 
referred to
Para 4
[2010] 6 SCR 857  
referred to
Para 5
[2015] 6 SCR 638
referred to
Para 6
[1993] 3 SCR 802
referred to
Para 8
[2014] 10 SCR 1
referred to
Para 8
[2016] 5 SCR 101
referred to
Para 8
[2004] 5 Suppl. SCR 720
relied on
Para 12
[2018] 10 SCR 956
referred to
Para 13
[1976] 2 SCR 347
referred to
Para 21
[2014] 12 SCR 875
referred to
Para 21
[2007] 1 SCR 706
referred to
Para 21
[1993] 2 Suppl. SCR 659
referred to
Para 26
[1978] 1 SCR 423 
referred to
Para 26
[2015] 13 SCR 1
referred to
Para 29
[1982] 1 SCR 947 
referred to
Para 38
[1985] 3 SCR 509 
referred to
Para 38
[2017] 5 SCR 160
referred to
Para 38
[2012] 6 SCR 661 
referred to
Para 39
[2018] 8 SCR 1  
referred to
Para 39
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[1970] 1 SCR 388 
referred to
Para 40
[1964] 2 SCR 608
referred to
Para 40
[1970] 3 SCR 745 
referred to
Para 41
[1976] 3 SCR 237 
referred to
Para 41
[1996] 2 SCR 23 
referred to
Para 41
[2003] 1 Suppl. SCR 1
referred to
Para 41
[1978] 3 SCR 334 
referred to
Para 42
(1994) 2 Suppl. SCC 726
referred to
Para 42
[1982] 2 SCR 246 
referred to
Para 42
[1991] 2 Suppl. SCR 497 
relied on
Para 43
[1995] 3 Suppl. SCR 545 
relied on
Para 43
[2018] 10 SCR 213  
relied on
Para 43
[2019] 12 SCR 30
referred to
Para 53
[2006] 6 Suppl. SCR 512 
referred to
Para 53
[1994] 5 Suppl. SCR 584
referred to
Para 53
[2014] 8 SCR 228  
referred to
Para 57
[2017] 6 SCR 946  
referred to
Para 57
In the judgment of S. Ravindra Bhat, J.
[2014] 10 SCR 1  
referred to
Para 5
[1987] 1 SCR 198
referred to
Para 6
[2017] 5 SCR 160 
referred to
Para 7
[1973] 1 Suppl. SCR
referred to
Para 8
[1997] 2 SCR 1186 
referred to
Para 9
[1994] 5 Suppl. SCR 1
referred to
Para 9
[2008] 13 SCR 1217
referred to
Para 10
[1987] 3 SCR 233
referred to
Para 11
[1997] 2 SCR 1186 
referred to
Para 11
[2010] 6 SCR 857
referred to
Para 11
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[ 2015] 6 SCR 638 
referred to
Para 11
[2019] 16 SCR 1  
referred to
Para 11
[1993] 3 SCR 802
referred to
Para 14
[1967] 1 SCR 77
referred to
Para 17
[1970] 2 SCR 666 
referred to
Para 17
[1987] 1 SCR 136
referred to
Para 17
(2004) 4 SCC 640
referred to
Para 17
[1974] 1 SCR 771 
relied on
Para 25
[1975] 1 SCR 449 
relied on
Para 26
[2007] 12 SCR 991
relied on
Para 28
[1993] 1 Suppl. SCR 749
referred to
Para 33
[1983] 2 SCR 287
followed
Para 39
[2008] 8 SCR 1
referred to
Para 41
In the judgment of Hemant Gupta, J.
[2019] 12 SCR 30 
relied on
Para 3
(2002) 4 SCC 578
followed
Para 8
[1982] 2 SCR 272
followed
Para 8
[2017] 5 SCR 406 
relied on
Para 9
[2018] 4 SCR 1
followed
Para 10
AIR 1965 SC 745
followed
Para 10
[2002] 2 SCR 383 
followed
Para 14
[2005] 5 Suppl. SCR 395
relied on
Para  15
[2004] 2 SCR 422
relied on
Para 16
[2008] 3 SCR 130 
relied on
Para 17
[2013] 17 SCR 496
relied on
Para 17
[2018] 12 SCR 972
relied on
Para 18
[2000] 1 Suppl. SCR 389 
relied on
Para 19
[1962] 3 SCR 786
referred to
Para 41
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[2007] 4 SCR 256
referred to
Para 42
[2003] 6 Suppl. SCR 860  
referred to
Para  42
[1989] 2 Suppl. SCR 597 
referred to
Para 42
[1988] 1 Suppl. SCR 379
referred to
Para 42
[1970] 1 SCR 388
referred to
Para 49
[1978] 3 SCR 334
referred to
Para 50
[1997] 2 Suppl. SCR 507 
referred to
Para 50
[2019] 7 SCR 1086
referred to
Para 51
[2014] 12 SCR 875
referred to
Para 52
[2006] 2 SCR 740
referred to
Para 52
[1991] 2 SCR 567
referred to
Para 55
CIVIL ORIGINAL JURISDICTION: Writ Petition (Civil) No.
502 of 2021.
Under Article 32 of The Constitution of India
KK Venugopal, AG., Balbir Singh, ASG., R. Balasubramanium,
Arvind P Datar, Siddharth Luthra, Aruneshwar Gupta, C S Vaidyanathan,
Krishnan Venugopal, Shashikiran Shetty, Ranjit Kumar, Mukul Rohtagi,
Gourab Benerjee, Paramjit Singh Patwalia, Sr. Advs., Zoheb Hossain,
Ms. Shradha Deshmukh, Ms. Chinmayee Chandra, Shyam Gopal, Ankur
Talwar, Ms. Suhasini Sen, Gurmeet Singh Makker, Mrs. Anil Katiyar,
Rahul Unnikrishnan, TVS Raghavendra Sreyas, Naveen Hegde,
Siddharth Vasudev, Navdeep Singh, Ms. Gayatri Gulati, Ms. Sakshi
Kakkar, Nalin Talwar, Sameer Abhyankar, Amish Tandon, Ayush Beotra,
Dipin Tamang, Uddhav Khanna, Akshay Joshi, K. C. Kaushik, Rahul
Kaushik, Ms. Bhuvneshwari Pathak, Ms. Shilpi Satyapriya Satyam,
Pankaj Singh, Ms. Ranjana Singh, Mahesh Thakur, Kaushik Mishra, Kiran
Patel, Ms. Viapsha Singh, R. Gowrishankar, S. Rajappa, Gourav Agrawal,
Chritarth Palli, Sahil
Tagotra, Rupesh Kumar, Rajeev Sharma,
Ms. Neelam Sharma, Ms. Pankhuri Shrivastava, Alekshendra Sharma,
Pravesh Bahuguna, Ninad Loud, Shubro Mukherjee, Ivo D’ Costa, Rajeev
Singh, P. B. Suresh, Krishna Dev Jagarlamudi, Sai Kaushal N., Advs.
for the appearing parties.
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The Judgment of the Court was delivered by
L. NAGESWARA RAO, J.
1. 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 violative of the principles of separation of powers and
independence  of  judiciary,  apart from  being  contrary  to the principles
laid down by this Court in Union of India v. R. Gandhi, President,
Madras Bar Association1, Madras Bar Association v. Union of India
& Anr.2, Rojer Mathew v. South Indian Bank Limited & Ors.3 and
Madras Bar Association v. Union of India & Anr.4. The Petitioner
seeks a further direction to Respondent No.2 for establishment of a
separate wing to cater to the requirements of tribunals in India.
2. A brief reference to the historical background of tribunalisation
in this country is necessary for a better appreciation of the dispute that
falls for adjudication in this Writ Petition. The Statement of objects and
reasons for insertion of Articles 323-A and 323-B in the Constitution of
India by the Forty-Second Amendment is as follows:
“To reduce the mounting arrears in High Courts and to secure
the speedy disposal of service matters, revenue matters
and
certain matters of special importance in the context of the
socio-economic development and progress, it is considered
expedient to provide for administrative and other tribunals
for dealing with such matters while preserving the jurisdiction
of the Supreme Court in regard to such matters under Articles
136 of the Constitution.  It is also necessary to make certain
modifications in the Writ Jurisdiction of the High Courts under
Article 226.”
3. The vires of the Administrative Tribunals Act, 1985, enacted
under Article 323-A (1), was challenged in S.P. Sampath Kumar v.
1 (2010) 11 SCC 1
2 (2014) 10 SCC 1
3 (2020) 6 SCC 1
4 (2020) SCC Online SC 962
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Union of India & Ors.5 before this Court. The main ground taken in
the writ petition was that the jurisdiction of the High Court under Article
226 and Article 227 cannot be barred. It was held by this Court in S.P.
Sampath Kumar (supra) that in place of a High Court, the Parliament
can set up an effective alternative institutional mechanism with the power
of judicial review vested in it, by placing reliance on the observation
made in Minerva Mills Ltd. & Ors. v. Union of India & Ors.6.
However, this Court was of the firm opinion that the tribunals should be
a real substitute 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.7 which found the exclusion
of the jurisdiction of the High Courts and the Supreme Court in Articles
323-A and 323-B 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 Act), BIFR and AAIFR under the Sick Industrial
Companies (Special Provisions) Act, 1985 and the jurisdiction and powers
relating to winding up vested in the High Courts. The Government
accepted the recommendations and passed the Companies (Second
Amendment) Act, 2002. The reason for the said amendment was to
avoid multiplicity of litigation before various fora and to reduce pendency
of cases. The Madras Bar Association filed a writ petition in the Madras
High Court challenging the constitutional validity of the said amendment
to the 1956 Act on the ground of legislative incompetence and violation
of the doctrines of separation of powers and independence of the judiciary.
5 (1987) 1 SCC 124
6 (1980) 3 SCC 625
7 (1997) 3 SCC 261
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The High Court upheld the validity of the Amendment Act of 2002 but
pointed out certain defects in the provisions of the Act.  The High Court
declared that the NCLT and the National Company Law Appellate
Tribunal (hereinafter referred to as NCLAT) cannot be constituted
without removing the defects pointed out in the judgment. The judgment
of the High Court was upheld by this Court in Union of India v.
R. Gandhi, President, Madras Bar Association8 (hereinafter referred
to as MBA-I). Parts I-B and I-C of the 1956 Act were directed to be
modified in accordance with the observations made in the judgment.
6. The Companies Act, 2013 (hereinafter referred to as the 2013
Act), which replaced the 1956 Act, contained provisions for establishment
of the NCLT and the NCLAT. Madras Bar Association filed a writ
petition under Article 32 of the Constitution challenging the formation of
NCLT under Section 408 of the 2013 Act. Several other provisions
pertaining to constitution of the NCLT and the NCLAT, qualifications
for appointment of Members and Chairperson / President and constitution
of the Selection Committee were also assailed in the said writ petition.
This Court in Madras Bar Association v. Union of India & Anr.9
(hereinafter referred to as MBA-II) upheld the validity of Section 408
by which the NCLT was constituted. However, clauses (a) and (e) of
Section 409(3) relating to the appointment of Technical Members were
held to be invalid. Section 411(3), which
provided qualifications of
Technical Members, and Section 412(2), which dealt with the constitution
of the Selection Committee, were also held to be invalid. A direction was
given to 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 31.03.2017
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)
8 (2010) 11 SCC 1
9 (2015) 8 SCC 583
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[L. NAGESWARA RAO, J.]
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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 proviso, the Chairperson, Vice-Chairperson
(and commensurate positions bearing different nomenclature) or Member
of the Tribunal shall hold office for such term as may be specified by the
rules made by the Central Government, not exceeding five years from
the date on which such person enters office. The Chairperson, Chairman
or President can hold office till they reach the age of 70 years and the
Vice-Chairperson, Vice-Chairman, Vice-President, Presiding Officer or
any other Member can continue till the age of 67 years, as per the second
proviso to Section 184.
8. A Notification was issued by the Central Government on
01.06.2017 by which the Tribunal, Appellate Tribunal and other Authorities
(Qualifications, Experience and other Conditions of Service of Members)
Rules, 2017 (hereinafter referred to as the 2017 Rules) were made.
The validity of Part XIV of the Finance Act, 2017 and the 2017 Rules
framed thereunder was questioned in Rojer Mathew (supra). The
petitioners contended that para XIV of the Finance Act, 2017 cannot be
classified as a money
bill. The question of money bill was referred to a
larger bench.  The validity of Section 184 of the Finance Act, 2017 was
upheld.  The 2017 Rules were held to be contrary to the parent amendment
and therefore, struck down. The Central Government was directed to
reformulate the rules strictly in accordance with the principles delineated
by this Court in R.K. Jain v. Union of India10, L. Chandra Kumar
(supra), Madras Bar Association v. Union of India & Anr.11 and
Gujarat Urja Vikas Nigam Ltd. v. Essar Power Ltd.12 The Central
Government was directed to formulate a new set of rules which would
ensure non-discriminatory and uniform conditions of service, including
assured tenure. As an interim order, this Court in Rojer Mathew (supra)
directed that the appointments to the Tribunals/ Appellate Tribunals and
the service conditions shall be in terms of the respective statutes before
the enactment of the Finance Bill, 2017.  Union of India was given liberty
to seek modification of the orders after framing fresh rules. On
10 (1993) 4 SCC 119
11 (2014) 10 SCC 1
12 (2016) 9 SCC 103
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12.02.2020, a notification was issued by the Central Government by
which the Tribunal, Appellate Tribunal and other Authorities
(Qualifications, Experience and other Conditions of Service of Members)
Rules, 2020 (hereinafter referred to 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.13
(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 Justice of India or his nominee,
outgoing or sitting Chairman or Chairperson or President of
the Tribunal and two Secretaries to
the Government of India,
the Search-cum-Selection Committees should comprise of the
following members:
(a) The Chief Justice of India or his nominee—Chairperson
(with a casting vote).
(b) The outgoing Chairman or Chairperson or President of
the Tribunal in case of appointment of the Chairman or
Chairperson or President of the Tribunal (or) the sitting
Chairman or Chairperson or President of the Tribunal in case
of appointment of other members of the Tribunal (or) a retired
Judge of the Supreme Court of India or a retired Chief Justice
13 (2020) SCC Online SC 962
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of a High Court in case the Chairman or Chairperson or
President of the Tribunal is not a Judicial member or if the
Chairman or Chairperson or President of the Tribunal is
seeking re-appointment—member;
(c) Secretary to the Ministry of Law and Justice, Government
of India—member;
(d) Secretary to the Government of India from a department
other than the parent or sponsoring department, nominated
by the Cabinet Secretary—member;
(e) Secretary to the sponsoring or parent Ministry or
Department—Member Secretary/Convener (without a vote).
Till amendments are carried out, the 2020 Rules shall be read
in the manner indicated.
(iii) Rule 4(2) of the 2020 Rules shall be amended to provide
that the Search-cum-Selection Committee shall recommend the
name of one person for appointment to each post instead of
a panel of two or three persons for appointment to each post.
Another name may be recommended to be included in the
waiting list.
(iv) The Chairpersons, Vice-Chairpersons and the members
of the Tribunal shall hold office for a term of five years and
shall be eligible for reappointment. Rule 9(2) of the 2020
Rules shall be amended to provide that the Vice-Chairman,
Vice-Chairperson and Vice President and other members shall
hold office till they attain the age of sixty-seven years.
(v) The Union of India shall make serious efforts to provide
suitable housing to the Chairman or Chairperson or President
and other members of the
Tribunals. If providing housing is
not possible, the Union of India shall pay the Chairman or
Chairperson or President and Vice-Chairman, Vice-
Chairperson, Vice President of the Tribunals an amount of
Rs. 1,50,000/- per month as house rent allowance and Rs.
1,25,000/- per month for other members of the Tribunals. This
direction shall be effective from 01.01.2021.
(vi) The 2020 Rules shall be amended to make advocates with
an experience of at least 10 years eligible for appointment as
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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 disciplinary actions shall be final
and the recommendations of the Search-cum-Selection
Committee shall be implemented by the Central Government.
(ix) The Union of India shall make appointments to Tribunals
within three months from the date on which the Search-cum-
Selection Committee completes the selection process and makes
its recommendations.
(x) The 2020 Rules shall have prospective effect and will be
applicable from 12.02.2020, as per Rule 1(2) of the 2020
Rules.
(xi) Appointments made prior to the 2017 Rules are governed
by the parent Acts and Rules which established the
concerned
Tribunals. In view of the interim orders passed by the Court
in Rojer Mathew (supra), appointments made during the
pendency of Rojer 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 12.02.2020
shall be governed by the 2020 Rules subject to the
modifications directed in the preceding paragraphs of this
judgment.
(xii) Appointments made under the 2020 Rules till the date of
this judgment, shall not be considered invalid, insofar as they
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conformed to the recommendations of the Search-cum-
Selection Committees in terms of the 2020 Rules. Such
appointments are upheld, and shall not be called into question
on the ground that the Search-cum-Selection Committees which
recommended the appointment of Chairman, Chairperson,
President or other members were in terms of the 2020 Rules,
as they stood before the modifications directed in this
judgment. They are, in other words, saved.
(xiii) In case the Search-cum-Selection Committees have made
recommendations after conducting selections in accordance
with the 2020 Rules, appointments shall be made within three
months from today and shall not be subject matter of
challenge on the ground that they are not in accord with this
judgment.
(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 12.02.2020 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 12.02.2020. While reserving the
matter for judgment on 09.10.2020, 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 13.02.2021 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
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(hereinafter referred to as the Ordinance) was promulgated on
04.04.2021. 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 below the age of 50 years
shall not be eligible for appointment as Chairperson or Member and also
the second proviso, read with the third proviso, which stipulates that the
allowances and benefits payable to Chairpersons and Members shall be
the same as a Central Government officer holding a post carrying the
same pay as that of the Chairpersons and Members. Section 184(7)
stipulates that the Selection Committee shall recommend a panel of two
names for appointment to the post of Chairperson or Member and the
Central Government shall take a decision preferably within three months
from the date of the recommendation of the Committee, notwithstanding
any judgment, order or decree of any Court. The said provision is also
assailed in this Writ Petition. Section 184 (11) which shall be deemed to
have been inserted with effect from 26.05.2017 provides that the term
of office of the Chairperson and Member of a tribunal shall be four
years. The age of retirement of the Chairperson and Members is specified
as 70 years and 67 years, respectively. If the term of office or the age of
retirement specified in the order of appointment issued by the Central
Government for those who have been appointed between 26.05.2017
and
04.04.2021 is greater than that specified in Section 184(11), the
term of office or the age of retirement shall be as set out in the order of
appointment, subject to a maximum term of office of five years. The
validity of Section 184(11) is also challenged in the Writ Petition.
10. We have heard Mr. Arvind P. Datar, learned Amicus Curiae,
Mr. K.K. Venugopal, learned Attorney General for India, Mr. Balbir
Singh, learned Additional Solicitor General, Mr. Mukul Rohatgi, learned
Senior Counsel, Mr. Sidharth Luthra, learned Senior Counsel, Mr. Gaurab
Banerjee, learned Senior Counsel, Mr. Aruneshwar Gupta, learned Senior
Counsel and Mr. Krishnan Venugopal, learned Senior Counsel.
11. Mr. Arvind P. Datar, learned Amicus Curiae, made the following
submissions:
i) The Ordinance is violative of the rule of separation of powers
which forms part of the basic structure of the Constitution. The
Ordinance is liable to be struck down as being violative of another
basic feature of the Constitution, i.e., independence of the judiciary.
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ii) Reversal of judgments which are not in accord with the
Government’s views undermines the judiciary, violating the
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 09.02.2018, 16.07.2018 and 21.08.2018 with the consent of
the learned Attorney General cannot be disturbed. The directions
issued by this Court with the consent of the Union of India cannot
be legislatively overruled.
12. Mr. P.S. Patwalia, learned Senior Counsel
appearing for
Mr. P. Dinesha, Member, CESTAT, submitted that there are at least four
orders passed by this Court on 09.02.2018, 20.03.2018, 16.07.2018 and
21.08.2018 which clarified that the age of retirement would be 62 years
for Members of the CESTAT and the ITAT. Relying upon the judgment
of this Court in Virender Singh Hooda & Ors. v. State of Haryana &
Anr.14, he submitted that even if this Court upholds the Ordinance, the
appointments made pursuant to the interim orders of this Court should
not be disturbed.
14 (2004) 12 SCC 588
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13. Mr. Rohatgi, learned Senior Counsel, argued that Mr. Ajay
Sharma who was practicing as an AOR in this Court responded to an
advertisement issued on 29.06.2016 for the appointment to the post of
Member (Judicial), CESTAT. He was appointed along with others on
11.04.2018 with a condition that his tenure will be for five years or till he
attains the age of 65 years, whichever is earlier. This Court clarified on
21.08.2018 that the retirement age of Member (Judicial), CESTAT shall
be 62 years. Proviso to Section 184(11) which prescribes a maximum of
five years tenure is a result of an impermissible exercise undertaken by
the Union of India. He further submitted that a mandamus issued by this
Court cannot be overruled by the legislature. Mr. Gaurab Banerjee,
learned Senior Counsel, submitted that Mr. S.K. Pati was appointed
Member (Judicial), CESTAT on 11.04.2018. He submitted that Mr. Pati
left his employment as an Additional District Judge and joined as Member
(Judicial). Mr. Sidharth Luthra, learned Senior Counsel, submitted that
Mrs. Rachna Gupta who is at present working as Member (Judicial) has
resigned as District Judge. He requested this Court to permit the
Members, CESTAT and other tribunals to continue till 62 years as directed
by this Court in its judgment in Kudrat Sandhu v. Union of India15.
Mr. Krishnan Venugopal, learned Senior Counsel appearing for
Advocates’ Association, Bengaluru, which was interested in appointments
being made to the
posts of Judicial and Accountant Members of the
ITAT, submitted that pursuant to the advertisement issued on 06.07.2018
inviting applications to 37 posts of Members (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 04.04.2021. 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.
15 W.P. No. 279 of 2017
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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 tribunals is a policy decision which should be
left to the collective decision of the Parliament. Legislative overruling is
a permissible exercise as has been held in a number of judgments of this
Court. He asserted that there can be no direction issued by this Court to
make law in a particular manner. Such directions issued by this Court
are treated as suggestions. Ultimately, the will of the people has to prevail.
Even interstitial directions given in the absence of law are subject to
future legislation. He was of the opinion that the Ordinance cannot be
challenged on the ground that it is contrary to the judgment of this Court
in MBA-III. The learned Attorney General argued that the minimum
age for appointment to tribunals is fixed at 50 years for the purpose of
maintaining equality. All aspirants from various fields have been put on
an even keel. According to him, there is no uniformity in the directions
issued by this Court regarding the tenure of Chairperson and Members.
Initially in S.P. Sampath Kumar (supra), this Court recommended five
to seven years as tenure. Thereafter, directions were issued to the effect
that tenure should be five years. The learned Attorney General submitted
that tenure of four years instead of five years was fixed after detailed
deliberations by experts which should not be interdicted by this Court.
Insofar as HRA is concerned, the learned Attorney General submitted
that Members of tribunals cannot be permitted to claim allowances higher
than officers in the Government carrying the same pay scale. In respect
of two names being sent for each post by the Selection Committee, the
learned Attorney General stated that the recommendations are subject
to inquiry by the Intelligence Bureau (IB) and in case the selected
candidate is found to be not suitable, there should be an alternative.
Therefore, it was decided that at least two names should be recommended
by the Selection Committee for each post. The Government is also
interested in filling up the vacant posts in the tribunals and the stipulation
of taking a decision preferably within three months does not mean that
the Government will not act with alacrity.
15. Mr. Balbir Singh, learned Additional Solicitor General defended
the retrospectivity given to Section 184(11) by arguing that the defect
pointed out by the judgment of MBA-III has been cured by the
Ordinance. It was held in MBA-III that the 2020 Rules came into force
on the date of their notification, i.e., 12.02.2020. Further, it was held that
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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 26.05.2017 and
04.04.2021 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 26.05.2017 and 04.04.2021 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 was, that God had endowed His Majesty with excellent
science, and great endowments of nature; but His Majesty
was not learned in the laws of his realm of England, and
causes which concern the life, or inheritance, or goods, or
fortunes of his subjects, are not to be decided by natural
reason, but by the artificial reason and judgment of the law,
which law is an act which requires long study and experience,
before that a man can attain to the cognizance of it; and that
the law was the golden metwand and measure to try the causes
of the subjects; and which protected His Majesty in safety
and peace. (“The Higher Law —Background of American
Constitutional Law” by Edward S. Corwin, pp. 38-39).”16
17. This dictum of Coke, announced in Dr Bohman case [(1610)
8 Co Rep 118-A] was soon repudiated in England, but the doctrine
announced in Coke’s dictum found fertile soil in the United States and
sprouted into such a vigorous growth that it was applied by the United
States Supreme Court in the decision of cases coming before it; and it
has been said that the doctrine of the supremacy of the Supreme Court
is the logical conclusion of Coke’s doctrine of control of the Courts over
legislation (See: Willis on Constitutional Law, 1936 Edn., p. 76).
16 Smt. Indira Nehru Gandhi v. Shri Raj Narain 1975 Supp SCC 1
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18. De l’esprit des lois was published in 1748 by
Charles de Secondat, Baron de Montesquieu.  According to Montesquieu,
there can be no liberty where the legislative and executive powers are
united in the same person or body of Magistrates. He argued that there
is no liberty, if the judicial power is not separated from the legislative and
executive. He further noted that there would be an end of everything,
were the same man or same body, whether of the nobles or of the people,
to exercise those three powers, that of enacting laws, that of executing
the public resolutions, and of trying the causes of individuals.
19. The Federalist Papers were written by Alexander Hamilton,
James Madison, and John Jay under the collective pseudonym “Publius”
to promote the ratification of the United States Constitution. James
Madison dealt with the particular structure of the new government and
the distribution of powers among its different parts in Federalist No.47
and separation of the departments not having constitutional control over
each other in Federalist No.48. The structure 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.17
22. The doctrine of separation of powers informs the Indian
constitutional structure and is an essential constituent of rule of law. In
other words, the doctrine of separation of powers, though not expressly
engrafted in the Constitution, its sweep, operation and visibility are
17 Smt. Indira Nehru Gandhi v. Shri Raj Narain (supra)
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apparent from the scheme of the Indian Constitution. The Constitution
has made demarcation, without drawing formal lines between the three
organs—legislature, executive and judiciary. Separation of powers
between three organs—the legislature, executive and judiciary—is also
nothing but a consequence of principles of equality enshrined in Article
14 of the Constitution of India. Accordingly, breach of separation of
judicial power may amount to negation of equality under Article 14. Stated
thus, a legislation can be invalidated on the basis of breach of the
separation of powers since such breach is negation of equality under
Article 14 of the Constitution.18 Equality, rule of law, judicial review and
separation of powers form parts of the basic structure of the Constitution.
Each of these concepts are intimately connected. There can be no rule
of law, if there is no equality before the law. These would be meaningless
if the violation was not subject to the judicial review. All these would be
redundant if the legislative, executive and judicial powers are vested in
one organ. Therefore, the duty to decide whether the limits have been
transgressed has been placed on the judiciary.19 Though, there is no rigid
separation of governmental powers between the executive, legislative
and judiciary, it is clear from the above judicial pronouncements and
literature that separation of powers forms part of the basic structure of
the Constitution. Violation of separation
of powers would result in
infringement of Article 14 of the Constitution.  A legislation can be declared
as unconstitutional if it is in violation of the principle of separation of
powers.
Independence of the Judiciary
23. Alexander Hamilton wrote in The Federalist No.78 as follows:
“The complete independence of the courts of justice is
peculiarly essential in a limited Constitution. By a limited
Constitution, I understand one which contains certain
specified exceptions to the legislative authority; such, for
instance, that it shall pass no bills of attainder, no ex post
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
18 State of Tamil Nadu v. State of Kerala & Anr. (2014) 12 SCC 696
19 I.R. Coelho v. State of T.N. (2007) 2 SCC 1
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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 26.08.1985 to
06.09.1985 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 and Protection of
Minorities to request Dr. L.M. Singhvi to prepare a report on the
independence and impartiality of judiciary. He submitted a draft
declaration on the independence and impartiality of the judiciary, jurors,
assessors and the independence of lawyers, which came to be known
as the Singhvi Declaration. The United Nations Commission on Human
Rights invited governments to take the Singhvi Declaration into account
in implementing the Basic Principles on the Independence of the
Judiciary.
The Bangalore Principles on Judicial Conduct, the product of several
meetings and deliberations of Chief Justices and Judges of both common
law and civil law systems and adopted by the United Nations Commission
on Human Rights on 29.04.2003, identified core values of the judiciary,
one of which is independence. The measures adopted by the Judicial
Integrity Group at its meeting held in Lusaka, Zambia on 21st and 22nd
January, 2010 for effective implementation of the Bangalore Principles
of Judicial Conduct referred to the responsibilities of States to ensure
guarantees, through constitutional or other means, on judicial
independence. One of the guarantees required to be provided by the
State to maintain judicial independence is that the legislative or executive
powers that may affect Judges in respect of their office, their
renumeration, conditions of service or other resources, shall not be used
with the object or consequence of threatening or bringing pressure upon
a particular Judge or Judges.
25. In his address dated 24.05.1949, Dr. B.R. Ambedkar stated
that: -
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“There can be no difference of opinion in the House that our
judiciary must be both independent of the executive and must
also be competent in itself.  And the question is how these two
objects can be secured”.
26. Article 50 of the Constitution of India provides that the State
shall take steps to separate the judiciary from the executive in the public
services of the State. The concept of separation of judiciary from
executive cannot be confined only to the subordinate judiciary, totally
discarding the higher judiciary.  If such a narrow and pedantic or syllogistic
approach is made and a constricted construction is given, it would lead
to an anomalous position that the Constitution does not emphasise the
separation of higher judiciary from the executive20. 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. 21
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.22
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 should be the duty of the State to apply the principles
in making laws. Undoubtedly, it is true that the provisions of Part IV are
not enforceable by the courts of law. However, this does not absolve the
obligation of the State from applying the principles of Part IV in making
laws. It is necessary to remind ourselves of what Dr. B.R. Ambedkar
stated in the Constituent Assembly on 19.11.1948 of Part IV, which is as
under: -
20 Supreme Court Advocates-on-Record Association & Ors. v. Union of India (1993)
4 SCC 441
21 Union of India v. Sankalchand Himatlal Sheth & Anr. (1977) 4 SCC 193
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“It is the intention of this Assembly that in future both the
legislature and the executive should not merely pay lip services
to the principles enacted in this part, but they should be made
the basis of all executive and legislative action that may be
taken hereafter in the matter of governance of the country”.
29. Impartiality, independence, fairness and reasonableness in
decision-making are the hallmarks of the judiciary. If “impartiality” is
the soul of the judiciary, “independence” is the lifeblood of the judiciary.
Without independence, impartiality cannot thrive. Independence is not
the freedom for Judges to do what they like. It is the independence of
judicial thought. It is the freedom from interference and pressures which
provides the judicial atmosphere where he can work with absolute
commitment to the cause of justice and constitutional values. It is also
the discipline in life, habits and outlook that enables a Judge to be impartial.
Its existence depends however not only on philosophical, ethical or moral
aspects but also upon several mundane things—security in tenure,
freedom from ordinary monetary worries, freedom from influences and
pressures within (from others in the judiciary) and without (from the
executive)23. The independence of an individual Judge, that is, decisional
independence; and independence of the judiciary as an institution or an
organ of the State, that is, functional independence are
the broad concepts
of the principle of independence of the judiciary/ tribunal24.
30. Individual independence has various facets which include
security of tenure, procedure for renewal, terms and conditions of service
like salary, allowances, etc. which should be fair and just and which
should be protected and not varied to his/her disadvantage after
appointment. Independence of the institution refers to sufficient degree
of separation 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
23 MBA-I
24 Supreme Court Advocates-on-Record Association & Anr. v. Union of India (2016)
5 SCC 1
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acquired and nurtured by the class to which the adjudicator belongs, are
important attributes of institutional independence25.
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.26
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
such encroachment by the legislature would amount to violating the
principles of separation of powers, judicial independence and the rule of
law. Independence of courts from the executive and the legislature is
fundamental to the rule of law and one of the basic tenets of the Indian
Constitution. Separation of powers between the three organs, i.e., the
legislature, the executive and the judiciary, is a consequence of the
principles of equality as enshrined in Article 14 of the Constitution27.
Any incursion into the judicial domain by the other two wings of the
Government would, thus, be unconstitutional.
Judicial decisions and legislative overruling
I. Comparative Jurisdictions
33. It would be profitable to refer to the reaction of courts to
legislative override in comparative
jurisdictions. Chief Justice John
Marshall of the US Supreme Court in Marbury  v.  Madison28  referred
to the Constitution as the fundamental and paramount law of the nation.
He declared that “It is emphatically the province and duty of the
judicial department to say what the law is.” In United States v.
Peters29, Chief Justice Marshall speaking for an unanimous Court said
that “If the legislatures of the several states may at will annul the
judgments of the Courts of the United States, and destroy rights
acquired under those judgments, the Constitution itself becomes a
solemn mockery…”
25 Rojer Mathew (supra)
26 MBA-I
27 State of Tamil Nadu v. State of Kerala & Anr. (supra)
28 5 U.S. 137 (1803)
29 9 U.S. 115 (1809)
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34. In Brown v. Board of Education of Topeka30, the United
States Supreme Court held that the Fourteenth Amendment forbids states
to use governmental powers to bar children on racial grounds from
attending school where there is states’ participation through any
arrangement, management, funds or property. The Governor or legislature
cannot declare that they are not bound by the judgment mentioned above.
The Board of Little Rock’s Central High School suspended its plan to do
away with desegregation in public schools. The said action of the school
was rejected by the District Court which was affirmed by the Court of
Appeal. There was an amendment to the Arkansas Constitution pursuant
to which a law was made relieving school children from compulsory
attendance at racially mixed schools. The school filed a petition in the
District Court seeking postponement of the programme of desegregation.
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. Aaron31. 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.
Arizona32, 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 interrogation and, that, if he is indigent, a lawyer will be
appointed to represent him. The Congress enacted § 3501 which provided
that a confession shall be admissible in criminal prosecution brought by
the United States or by the District of Columbia if it is voluntarily given.
Charles Thomas Dickerson charged with a robbery and use of a firearm
moved the District Court to suppress his statement which he made to
the Federal Bureau of Investigation (FBI) that he has not received
30 347 U.S. 483 (1954)
31 358 U.S. 1 (1958)
32 384 U.S. 436 (1966)
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Miranda warnings. The motion to suppress was quashed by the District
Court which was reversed by the United States Court of Appeal for the
Fourth Circuit on the basis of the enactment § 3501. The United States
Supreme Court in Dickerson v. United States33 authoritatively
pronounced that the Congress cannot legislatively supersede a decision
of the Supreme Court interpreting and applying the Constitution. As
Miranda amounts to a constitutional rule, the Supreme Court concluded
that the Congress cannot supersede the judgment legislatively. The
learned Attorney General referred to an article written by Erwin
Chemerinsky titled “The Court should have remained silent: Why the
Court erred in deciding Dickerson v. United States”34. The said article
is a critical analysis of the judgment of the Supreme Court in Dickerson
wherein the author wrote that the desire to rule on the constitutionality
of the law simply does not justify the courts raising it sua sponte. He
opined that the Fourth Circuit and ultimately the Supreme Court violated
the separation of powers by considering § 3501 over the objection of the
executive branch. In Dickerson, the justice department informed the
Supreme Court that it was not invoking § 3501 and that it could not use
the confession only if the Court found that Miranda warnings were not
properly administered. In spite of the submission made by the justice
department, the Fourth Circuit ruled on the admissibility of the confession
on the
basis of § 3501. Chemerinsky argues in his article that the judiciary
exceeded its jurisdiction in considering § 3501 when none of the parties
raised the issue.
36. Justice Scalia speaking for the majority in Plaut  v. Spendthrift
Farm, Inc.35 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.
33 530 U.S. 428 (2000)
34 Erwin Chemerinsky, The Court Should Have Remained Silent: Why the Court
Erred in Deciding Dickerson v. United States, 149 Pennsylvania Law Review 287-
308 (2001)
35 514 U.S. 211 (1995)
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37. In his article, “The Case for the Legislative Override”36,
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 cannot strike down a legislation but can declare it to be
incompatible with the European Convention or the Bill of Rights. As far
as Germany is concerned, statutes would be stricken if they are declared
unconstitutional by the courts, and would be unrescuable by constitutional
amendment if they are found to violate certain unamendable constitutional
provisions. If the statutes are invalidated on being found unconstitutional
by the courts in Canada and Israel, the legislature could override the
judgments of the courts leveraging what is termed as the ‘notwithstanding’
clause in the Canadian context, i.e., notwithstanding their conflict with
the Charter or Basic Law.
II. India
(A) Scope of judicial review
38. Shifting focus to legislative override in our country, it is
necessary to first appreciate the scope of judicial review of ordinances
which is the same as that of a legislative act. Article 123 of the
Constitution
empowers the President to promulgate an ordinance during
recess of the Parliament, which shall have the same force and effect as
an act of the Parliament. The validity of an ordinance can be challenged
on grounds available for judicial review of a legislative act. An ordinance
passed either under Article 123 or under Article 213 of the Constitution
stands on the same footing. When the Constitution says that the ordinance-
making power is legislative power and an ordinance shall have the same
force as an act, an ordinance should be clothed with all the attributes of
an act of legislature carrying with it all its incidents, immunities and
limitations under the Constitution. It is settled law that judicial review of
an ordinance should be akin to that of legislative action.37
36 Nicholas Stephanopoulos, The Case for the Legislative Override, 10 UCLA
Journal of International Law and Foreign Affairs 250 (2005)
37 R.K. Garg v. Union of India & Ors. (1981) 4 SCC 675; T. Venkata Reddy & Ors. v.
State of Andhra Pradesh (1985) 3 SCC 198; Krishna Kumar Singh & Anr. v. State of
Bihar & Ors. (2017) 3 SCC 1.
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39. The controversy that arises for the consideration of this Court
relates to the legislative response to the judgment of this Court in
MBA-III. The power to strike down primary legislation enacted by the
Union of India or the State legislatures is on limited grounds. The Courts
can strike down legislation either on the basis that it falls foul of federal
distribution of powers or that it contravenes fundamental rights or other
constitutional rights/provisions of the Constitution of India.38  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.39, 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.40
(B) Permissible legislative overruling
40. The judgment in Shri Prithvi Cotton Mills Ltd. &
Anr. v. Broach Borough Municipality & Ors.41 was relied upon by
both sides.  The validity of the rules framed by Municipal Corporation
under Section 73 of the Bombay Municipal Boroughs Act, 1925 for levying
a rate on open lands was the subject matter of challenge in Patel
Gordhandas Hargovindas & Ors. v. Municipal Commissioner,
Ahmedabad & Anr42. The relevant rule was declared ultra vires of the
Act itself.  Later, the State legislature passed a validation act seeking to
validate the imposition of tax, the validity of which was considered in
Shri Prithvi Cotton Mills Ltd. (supra). This Court held that it is not
sufficient to merely declare that the decision of the Court shall not bind
as such declaration would amount to the reversal of a decision of the
Court which the legislature cannot do. It was further observed that a
38 Binoy Vishwam v. Union of India & Ors. (2017) 7 SCC 59
39 (2012) 6 SCC 312
40 K.S. Puttaswamy & Anr. v. Union of India & Anr. (2019) 1 SCC 1
41 (1969) 2 SCC 283
42 (1964) 2 SCR 608
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Court’s decision must always bind unless the conditions on which it is
based are so fundamentally altered that the decision could not have been
given in the altered circumstances.
41. It is open to the legislature within certain limits to amend the
provisions of an Act retrospectively and to declare what the law shall be
deemed to have been, but it is not open to the legislature to say that a
judgment of a Court properly constituted and rendered in exercise of its
powers in a matter brought before it shall be deemed to be ineffective
and the interpretation of the law shall be otherwise than as declared by
the Court.43  The test of judging the validity of the amending and validating
enactment is, whether the legislature enacting the validating statute has
competence over the subject-matter; whether by validation, the said
legislature has removed the defect which the Court had found in the
previous laws; and whether the validating law is consistent with the
provisions of Part III of the Constitution.44 In State of Tamil Nadu v.
State of Kerala & Anr. (supra), this Court held that any law enacted by
the legislature may be invalidated if it is an attempt to interfere with
judicial process by being in breach of the doctrine of separation of powers.
42. The judgment of this Court in Madan Mohan Pathak & Anr.
v. Union of India & Ors.45 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 24.01.1974 read with administrative instructions dated 29.03.1974.
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
43 Janapada Sabha Chhindwara v. Central Provinces Syndicate Ltd. & Anr. (1970) 1
SCC 509
44 I.N. Saksena v. State of Madhya Pradesh (1976) 4 SCC 750; Indian Aluminium Co. &
Ors. v. State of Kerala & Ors. (1996) 7 SCC 637; Bakhtawar Trust & Ors. v. M. D.
Narayan & Ors. (2003) 5 SCC 298
45 (1978) 2 SCC 50
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invalid so that a validating statute can remove the defect pointed out in
the judgment. He observed that the judgment of the Calcutta High Court
gave effect to the rights of the petitioners by mandamus, directing the
LIC to pay annual cash bonus. As long as the judgment of the learned
single Judge is not reversed in appeal, it cannot be disregarded or ignored.
The LIC was held to be bound by the writ of mandamus issued by the
Calcutta High Court. Justice Beg, in his concurrent opinion, held that the
rights which accrued to the employees on the basis of the mandamus
issued by the High Court cannot be taken away either directly or indirectly
by subsequent legislation. Thereafter, Madan Mohan Pathak (supra)
came up for discussion in Sri Ranga Match Industries & Ors. v. Union
of India & Ors.46. Justice Jeevan Reddy was of the opinion that the
Madan Mohan Pathak case cannot be treated as an authority for the
proposition that mandamus cannot be set aside by a legislative act. Justice
Hansaria was not in agreement with such view. Relying upon the judgment
of this Court in A.V. Nachane & Anr. v. Union of India & Anr.47,
Justice Hansaria held that the legal stand taken by Justice Beg in the
Madan Mohan Pathak case had received majority’s endorsement and
it was because of this that retrospectivity given to the relevant rule
assailed in A.V. Nachane was held to have nullified the effect of the
writ and was accordingly invalid. In view of the difference of opinion,
the matter was referred to a larger bench. We are informed by the
leaned Amicus Curiae that the difference of opinion could not be resolved
as the case was settled out of court.
43. In Virender Singh Hooda (supra), this Court did not accept
the contention of the petitioners therein that vested rights cannot be
taken away by retrospective legislation. However, it was observed that
taking away of such rights would be impermissible if there is violation of
Articles 14, 16 or any other constitutional provision. The appointments
already made in implementation of a decision of this Court were protected
with the reason that “the law does not permit the legislature to take
away what has been granted in implementation of the Court’s
decision. Such a course is impermissible.” This Court in Cauvery
Water Disputes Tribunal48 declared the ordinance which sought to
displace an interim order passed by the statutory tribunal as
unconstitutional as it set side an individual decision inter partes and
46 1994 Supp (2) SCC 726
47 (1982) 1 SCC 205
48 1993 Supp (1) SCC 96 (2)
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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 Mysore49 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.50
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 fundamental rights guaranteed
under the Constitution.51
b) The test for determining the validity of a validating legislation is
that the judgment pointing out the defect would not have been passed, if
the altered position as sought to be brought in by the validating statute
existed before the Court at the time of rendering its judgment. In other
words, the defect pointed out should have been
cured such that the basis
of the judgement pointing out the defect is removed.
c) Nullification of mandamus by an enactment would be
impermissible legislative exercise [See: S.R. Bhagwat (supra)]. Even
interim directions cannot be reversed by a legislative veto [See: Cauvery
Water Disputes Tribunal (supra) and Medical Council of India v.
State of Kerala & Ors.52].
d) Transgression of constitutional limitations and intrusion into the
judicial power by the legislature is violative of the principle of separation
of powers, the rule of law and of Article 14 of the Constitution of India.
49 (1995) 6 SCC 16
50 P. Sambamurthy & Ors. v. State of Andhra Pradesh & Anr. (1987) 1 SCC 362
51 Lohia Machines Ltd. & Anr. v. Union of India & Ors. (1985) 2 SCC 197
52 (2019) 13 SCC 185
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Validity of the Impugned Ordinance
45. The learned Amicus Curiae submitted that the Ordinance
impugned in the Writ Petition is unconstitutional as it is violative of the
separation of powers, the rule of law and independence of the judiciary.
He argued that the principle of independence of the judiciary can be
traced to Article 14 of the Constitution and the Ordinance is liable to be
struck down as being violative of the equality clause. The learned Amicus
Curiae relied upon the judgments of this Court to submit that the impugned
Ordinance is a classic case of law laid down by this Court being
overturned by the legislature unreasonably. Responding to the submissions
of the learned Attorney General that deference has to be shown by
courts to the policy decisions of the executive and the legislature, the
learned Amicus Curiae argued that deference has to be shown to the
reasons of the policy and not the policy itself. The learned Attorney
General asserted that the law laid down by this Court is not the final
word as it is settled that the Parliament can legislate by curing the defects
pointed out by the Court. The learned Attorney General stated that
legislation is made after the decision undergoes detailed deliberations at
various levels in the Government and the legislature. The collective
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 the Finance Act, 2017, prior to
amendment, is as follows:
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(1) The Central Government may, by notification, make rules
to provide for qualifications, appointment, term of office,
salaries and allowances, resignation, removal and the other
terms and conditions of service of the Chairperson, Vice-
Chairperson, Chairman, Vice-Chairman, President, Vice-
President, Presiding Officer or Member of the Tribunal,
Appellate Tribunal or, as the case may be, other Authorities
as specified in column (2) of the Eighth Schedule:
Provided that the Chairperson, Vice-Chairperson,
Chairman, Vice-Chairman, President, Vice-President,
Presiding Officer or Member of the Tribunal, Appellate
Tribunal or other Authority shall hold office for such term as
specified in the rules made by the Central Government but
not exceeding five years from the date on which he enters
upon his office and shall be eligible for reappointment:
Provided further that no Chairperson, Vice-
Chairperson, Chairman, Vice-Chairman, President, Vice-
President, Presiding Officer or Member shall hold office as
such after he has attained such age as specified in the rules
made by the Central Government which shall not exceed, —
(a) in the case of Chairperson, Chairman [President or the
Presiding Officer of the Securities Appellate Tribunal],
the age of seventy years;
(b) in the case of Vice-Chairperson, Vice-Chairman, Vice-
President, Presiding Officer [of the Industrial Tribunal
constituted by the Central Government and the Debts
Recovery Tribunal] or any other Member, the age of sixty-
seven years:
47. The amendment to Section 184 by the Ordinance is as follows:
184. (1) The Central Government may, by notification, make
rules to provide for the qualifications, appointment, salaries
and allowances, resignation, removal and the other conditions
of service of the Chairperson and Members of the Tribunal
as specified in the Eighth Schedule:
Provided that a person who has not completed the age
of fifty years shall not be eligible for appointment as a
Chairperson or Member:
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Provided further that the allowances and benefits so
payable shall be to the extent as are admissible to a Central
Government officer holding the post carrying the same pay:
Provided also that where the Chairperson or Member
takes a house on rent, he may be reimbursed a house rent
subject to such limits and 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 a retired
Chief Justice of a High Court nominated
by the Chief Justice
of India, namely: ––
(i) Industrial Tribunal constituted by the Central
Government under the Industrial Disputes Act, 1947;
(ii) Tribunals and Appellate Tribunals constituted under
the Recovery of Debts Due to Banks and Financial Institutions
Act, 1993;
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(iii) Tribunals where the Chairperson or the outgoing
Chairperson, as the case may be, of the Tribunal is not a
retired Judge of the Supreme Court or a retired Chief Justice
or Judge of a High Court; and
(iv) such other Tribunals as may be notified by the Central
Government in consultation with the Chairperson of the
Search-cum-Selection Committee of that Tribunal; and
(d) the Secretary to the Government of India in the Ministry
or Department under which the Tribunal is constituted or
established –– Member- Secretary.
(4) The Chairperson of the Committee shall have the casting
vote.
(5) The Member-Secretary of the Committee shall not have
any vote.
(6) The Committee shall determine its procedure for making
its recommendations.
(7) Notwithstanding anything contained in any judgment, order
or decree of any Court or in any law for the time being in
force, the Committee shall recommend a panel of two names
for appointment to the post of Chairperson or Member, as
the case may be, and the Central Government shall take a
decision on the recommendations of the Committee preferably
within three months from the date on which the Committee
makes its recommendations to the Government.
(8) No appointment shall be invalid merely by reason of any
vacancy or absence in the Committee.
(9) The Chairperson and Member of a Tribunal shall be
eligible for re-appointment in accordance with the provisions
of this section:
Provided that in
making such re-appointment, preference
shall be given to the service rendered by such person.
(10) The Central Government shall, on the recommendation
of the Committee, remove from office, in such manner as may
be provided by rules, any Member, who—
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(a) has been adjudged as an insolvent; or
(b) has been convicted of an offence which involves moral
turpitude; or
(c) has become physically or mentally incapable of acting as
such a Member; or
(d) has acquired such financial or other interest as is likely
to affect prejudicially his functions 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;
53(11) Notwithstanding anything contained in any judgment,
order, or decree of any Court or any law for the time being in
force, ––
(i) the Chairperson of a Tribunal shall hold office for a term
of four years or till he attains the age of seventy years,
whichever is earlier;
(ii) the Member of a Tribunal shall hold office for a
term of
four years or till he attains the age of sixty-seven years,
whichever is earlier:
53 With effect from 26.05.2017.
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Provided that where a Chairperson or Member is
appointed between the 26th day of May, 2017 and the notified
date and the term of his office or the age of retirement specified
in the order of appointment issued by the Central Government
is greater than that which is specified in this section, then,
notwithstanding anything contained in this section, the term
of office or age of retirement or both, as the case may be, of
the Chairperson or Member shall be as specified in his order
of appointment subject to a maximum term of office of five
years.
48. The first proviso of Section 184(1) provides minimum age for
appointment as Chairperson or Member as 50 years. One of the issues
considered in MBA-III was the correctness of the condition imposed in
the 2020 Rules that an advocate is eligible for appointment as a Member
only if he has 25 years of experience. It is relevant to state that advocates
were ineligible for most of the tribunals. The learned Attorney General
fairly submitted in his arguments that suitable amendment will be made
to make advocates eligible, subject to their having 25 years’ experience.
The learned Amicus Curiae contended in MBA-III that in order to attract
competent advocates to apply for appointment as Members in tribunals,
it is necessary that they should be made eligible for appointment on the
same criteria as applicable for appointment of a High Court Judge. The
learned Amicus Curiae suggested
that advocates with a standing of 15
years at the bar should be made eligible for appointment as Members of
tribunals. In MBA-III, exclusion of advocates from being appointed as
Members was found to be contrary to the judgment of this Court in
MBA-I and MBA-II. While recording the submission of the learned
Attorney General that Rules shall be amended to make advocates eligible
for appointment as Members, it was held in MBA-III  that experience
at the bar for advocates to be considered for appointment as Members
should be the same as is applicable for appointment as High Court Judges,
i.e., 10 years. In such view of the matter, a direction was given in
MBA-III to amend the 2020 Rules to make advocates with at least 10
years of experience at the bar 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
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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 direct affront to
the judgment of this Court in MBA-III. This Court in MBA-I and Roger
Mathew (supra) underlined the importance of recruitment of Members
from the bar at a young age to ensure a longer tenure. Fixing a minimum
age for recruitment of Members as 50 years would act as a deterrent
for competent advocates to seek appointment. Practically, it would be
difficult for an advocate appointed after attaining the age of 50 years to
resume legal practice after completion of one term, in case he is not
reappointed. Security of tenure and conditions of service are recognised
as core components of independence of the judiciary. Independence of
the judiciary can be sustained only
when the incumbents are assured of
fair and reasonable conditions of service, which include adequate
renumeration and security of tenure. Therefore, the first proviso to Section
184(1) is in violation of the doctrine of separation of powers as the
judgment of this Court in MBA-III has been frustrated by an
impermissible legislative override.  Resultantly, the first proviso to Section
184 (1) is declared as unconstitutional as it is violative of Article 14 of
the Constitution. Selections conducted for appointment of Members, ITAT
pursuant to the advertisement issued in 2018 should be finalized and
appointments made by considering the candidates between 35 to 50 years
as also eligible.
50. The second proviso to Section 184(1) deals with the allowances
and benefits payable to the Members which are to be the same as are
admissible to a Central Government officer holding a post carrying the
same pay. According to Rule 15 of the 2020 Rules, Chairpersons and
Members of tribunals were entitled to House Rent Allowance at the
same rate as admissible to officers with the Government of India holding
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Group ‘A’ post carrying the same pay. The contention of the learned
Amicus Curiae in MBA-III was that the majority of the tribunals are
situated in Delhi and there is scarcity of housing in Delhi. Not many
Judges of the High Court are interested in accepting appointment to
tribunals in view of the acute problem of housing. An amount of Rs.75,000/
- per month which was paid as House Rent Allowance (HRA) was not
sufficient to get a decent accommodation in Delhi for Chairpersons and
Members of tribunals. Taking note of the serious problem of housing
and the inadequate amount that was being paid as HRA to the Members,
this Court in MBA-III directed enhancement of HRA to
Rs.1,25,000/- per month to the Members and Rs.1,50,000/- per month to
Chairperson or Vice-Chairperson or President of tribunals.  This direction
was made effective from 01.01.2021. 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
Rs.60,000/- as HRA. The second proviso to Section 184(1), read with
the third proviso, is an affront to the judgment of this Court in MBA-III.
By no stretch of imagination can it be said that the said provisos are a
result of curative legislation. The direction issued by this Court in
MBA-III for payment of HRA was to ensure that decent accommodation
is provided to Tribunal Members. Such direction was issued to uphold
independence of the judiciary and it cannot be subject matter of legislative
response. A mandamus issued by this Court cannot be reversed by the
legislature as it would amount to impermissible legislative override.
Therefore, the second proviso, read with the third proviso, to Section
184(1) is declared as unconstitutional.
51. It has come to our notice that after the judgement in this Writ
Petition had been reserved on 03.06.21, a notification was issued by the
Ministry of Finance (Department of Revenue) on 30.06.21 amending
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the 2020 Rules. By Rule 6 of the Tribunal, Appellate Tribunal and other
Authorities (Qualifications, Experience and other Conditions of Service
of Members) (Amendment) Rules, 2021 (hereinafter referred to as the
2021 Amendment Rules), the following rule was substituted for Rule
15 of the 2020 Rules:
“15. House rent allowance.- With effect from the 1st January,
2021, the Chairman, Chairperson, President, Vice Chairman,
Vice Chairperson or Vice President 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 fifty thousand
rupees per month and the Presiding Offices and Members
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.”
According to the notification dated 30.06.2021, the 2021
Amendment Rules shall come into force on the date of their publication
in the official gazette. However, it may be noted that the Explanatory
Memorandum at the end of the notification states that Rule 6 of the
2021 Amendment Rules, amending Rule 15 of the 2020 Rules on HRA,
shall be given retrospective operation with effect from 01.01.21, in order
to give effect to the judgement of this Court in MBA-III. Though we
have adjudicated the validity of
the second and third provisos 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
01.01.21, 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
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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 restricted to two instead
of three. To limit the discretion of the executive after the SCSC has
recommended names of selected candidates, this Court in the interest of
preserving independence of the judiciary, directed that Rule 4(2) should
be read as empowering SCSC to recommend the name of only one
person to each post.
53. The learned Attorney General asserted that this Court cannot
direct the legislature to make law. He relied upon the judgment in
Dr. Ashwani Kumar v. Union of India & Anr.54 wherein it was held
that it is beyond the competence of this Court to direct legislature to
make law. There is no quarrel with the said proposition. The learned
Attorney General further asserted that the direction given by this Court
in MBA-III relating to the number of candidates to be recommended
for appointment to each post can only be taken to be a suggestion. The
Court, as a wing of the State, by itself is a source of law. The law is
what the Court says it is. To clarify the position relating to Article 141
vis-à-vis Article 142, it has been held by this Court in Ram Pravesh
Singh & Ors. v. State of Bihar & Ors.55 that directions given under
Article 142 is not law laid down
by the Supreme Court under Article
141. Any order not preceded by any reason or consideration of any
principle is an order under Article 142.  Article 136 of the Constitution is
a corrective jurisdiction that vests a discretion in the Supreme Court to
settle the law clear and as forthrightly forwarded in Union of India &
Ors. v. Karnail Singh & Ors.56, it makes the law operational to make
it a binding precedent for the future instead of keeping it vague. In short,
it declares the law, as under Article 141 of the Constitution. “Declaration
of law” as contemplated in Article 141 of the Constitution is the speech
express or necessarily implied by the highest Court of the land. The law
declared by the Supreme Court is binding on all courts within the territory
of India under Article 141, whereas, Article 142 empowers the Supreme
Court to issue directions to do complete justice. Under Article 142, the
Court can go to the extent of relaxing the application of law to the parties
or exempting altogether the parties from the rigours of the law in view
54 (2020) 13 SCC 585
55 (2006) 8 SCC 381
56 (1995) 2 SCC 728
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of the peculiar facts and circumstances of the case.57 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
appointments to tribunals within three months from the completion of
the selection and recommendation by the SCSC. Such direction was
necessitated in view of the lethargy shown by the Union of India in
making appointments and filling up the posts of Chairpersons and
Members of tribunals which have been
long vacant. The tribunals which
are constituted as an alternative mechanism for speedy resolution of
disputes have become non-functional due to the large number of posts
which are kept unfilled for a long period of time. Tribunals have become
ineffective vehicles of administration of justice, resulting in complete
denial of access to justice to the litigant public. The conditions of service
for appointment to the posts of Chairpersons and Members have been
mired in controversy for the past several years, thereby, adversely
affecting the basic functioning of tribunals. This Court is aghast to note
that some tribunals are on the verge of closure due to the absence of
Members. The direction given by this Court for expediting the process
of appointment was in the larger interest of administration of justice and
to uphold the rule of law. Section 184(7) as amended by the Ordinance
permitting the Government to take a decision preferably within three
months from the date of recommendation of the SCSC is invalid and
57 State of Punjab & Ors. v. Rafiq Masih (Whitewasher) (2014) 8 SCC 883; State v.
Kalyan Singh & Ors. (2017) 7 SCC 444
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unconstitutional, as this amended provision simply seeks to negate the
directions of this Court.
55. The tenure of the Chairperson and Member of a tribunal is
fixed at four years by Section 184(11), notwithstanding anything contained
in any judgment, order or decree of any court. It is relevant to mention
that sub-section (11) of Section 184 has been given retrospective effect
from 26.05.2017. Rule 9 of 2020 Rules had specified the term of
appointment of the Chairperson or Member of the Tribunal as four years.
The learned Amicus Curiae while making his submissions in MBA-III
had insisted that the Chairperson and Members of a tribunal should have
a minimum term of five years by placing reliance on the judgment of this
Court in S.P. Sampath (supra), MBA-I and Rojer Mathew (supra).
The stand taken by him was that a short tenure would be a disincentive
for competent persons to seek appointment as Members of tribunals.
The learned Attorney General submitted that the term of four years is
subject to reappointment. He contended that advocates who are appointed
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 Rules 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 26.05.2017 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 26.05.2017
and the notified date, i.e., 04.04.2021. The proviso lays down that if the
tenure of office or age of retirement specified in the order of appointment
issued by the Government is greater than what is specified in Section
184(11), the term of office or the age of retirement of the Chairperson
or Members shall be as specified in the order of appointment subject to
a maximum term of office of five years. In other words, the term of
office of Chairperson and Members of tribunals who were appointed
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between 26.05.2017 and 04.04.2021 shall be five years even though the
order of appointment issued by the Government has a higher term of
office or age of retirement which may involve the term of office being
more than 5 years in practice. It is necessary at this stage to deal with
the validity of retrospective effect given to sub-section (11) of Section
184. The learned Amicus Curiae canvassed a submission that Sections
184(1) to (10) are prospective in operation and Section 184(11) is given
retrospective effect from 26.05.2017, thereby leading to an anomalous
situation. He submitted that sub-section (11) is made with the object of
reversing the interim orders passed by this Court in Kudrat Sandhu v.
Union of India (supra). He stated that the terms and conditions of
appointments to be made to the Tribunals/Appellate Tribunals shall be in
terms of the respective statutes in force, before the enactment of the
Finance Bill, 2017, according to para 224 of Rojer Mathew (supra).
Mr. Balbir Singh, learned Additional Solicitor General, submitted that
retrospectivity given to sub-section (11) of Section 184 is a permissible
legislative override of the judgment of this Court in MBA-III. The 2020
Rules were held to be prospective in MBA-III on two grounds - a) it
was clear from the Notification dated 12.02.2020 that there was no
intention on the part of the Government of India to make the 2020 Rules
retrospective; b) subordinate legislation cannot be given
prospective effect
unless the parent statute specifically provided the same. It is understood
that while inserting sub-section (11) in Section 184 in the Finance Act,
2017 and giving it retrospective effect from 26.05.2017, the Ordinance
has attempted to cure the defect as was pointed out by this Court in
terms of retrospective application while considering the 2020 Rules.
However, the implications are not relevant for clauses (i) and (ii) of
Section 184(11) which are declared as void and unconstitutional for the
reasons mentioned above.
57. Insofar as the proviso to Section 184(11) is concerned, the
Ordinance sets the maximum tenure at five years even with respect to
the appointment orders passed between 26.05.2017 and 04.04.2021
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 09.02.2018. 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
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the Rules in respect of all tribunals. On 16.07.2018, 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 21.08.2018, 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 effect, the appointments made pursuant
to the interim directions passed by this Court cannot be interfered with.
This Court in Virender Singh Hooda (supra) upheld the retrospectivity
of the legislation which had been challenged but the appointment of the
petitioners therein pursuant to a direction of the Court were saved.  It
was held that the law does not permit the legislature to take back what
has been granted in the implementation of the Court’s decision and such
a course is impermissible. Similarly, in S.R. Bhagwat (supra), it was
declared that a mandamus against the respondent-State giving financial
benefits to the petitioners therein cannot be nullified by a legislation. It is
also relevant to point out that even interim orders passed by this Court
cannot be overruled by a legislative act, as discussed above. While making
it clear that the appointments that are made to the CESTAT on the basis
of interim orders passed by this Court shall be governed by the relevant
statute and the rules framed thereunder, as they existed prior to the
Finance Act, 2017, we uphold the retrospectivity given to the proviso to
Section 184 (11). To clarify further, all appointments after 04.04.2021
shall be governed by the Ordinance, as modified by the directions
contained herein.
58. To conclude, the first proviso and the second proviso, read
with the third proviso, to Section 184 overriding the judgment of this
Court in MBA-III in respect of fixing 50 years as minimum age for
appointment and payment of HRA, Section 184(7) relating to
recommendation of two names for each post by the SCSC and further,
requiring the decision to be taken by the Government preferably within
three months are declared to be unconstitutional. Section 184(11)
prescribing tenure of four years is contrary to the principles of separation
of powers, independence of judiciary, rule of law and Article 14 of the
Constitution of India. Though, we have upheld the proviso to Section
184(11), the appointments made to the CESTAT pursuant to the interim
orders passed by this Court shall be governed by the relevant statute
and the rules framed thereunder that existed prior to 26.05.2017. We
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have already taken notice of the notification dated 30.06.21 by way of
which Rule 15 of the 2020 Rules dealing with HRA has been amended
in conformity with our directions in MBA-III.
Peroration
59. The Petitioner continues 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 justice
being administered by tribunals need to be restored.
60. The Writ Petition is disposed of accordingly.
S. RAVINDRA BHAT, J.
1. One may well ask why there is need for a concurrence when
the judgment with which this author agrees, both as to its reasoning as
well as its conclusions, is as fully and well-reasoned as L. Nageswara
Rao, J’s judgment is. The reason lies in the importance of the themes
which have been deliberated- independence of the judiciary and separation
of powers, both of which are timeless in their resonance and relevance.
This brief prefatory aside at the beginning, outlines the approach this
opinion strives to take, while wholeheartedly supporting the conclusions
recorded by Rao, J. With great respect to Hemant Gupta, J, I cannot
persuade myself to agree with him, that as regards prescription of
minimum age (for appointment to tribunals, i.e. 50 years) or with respect
to conditions of service such as payment of house rent allowance, this
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court ought to respect legislative wisdom, and that directions issued in
past judgments cannot bind Parliament, as they fell outside the judicial
sphere.
2. Independence of the judiciary is one of the foundational pillars
of every democracy governed by the rule of law, where the constitution
reigns supreme. Some constitutions may guarantee this in emphatic terms,
whereas in others, there may be no single provision manifested in the
constitution, but rather, the idea may emerge as a compelling inference -
through the kind of assurances articulated by express provisions (tenure,
eligibility, age of superannuation, conditions where removal is possible
only through Parliamentary or legislative process, manner of appointment
etc). The Attorney General’s assertion that since there is no single provision
which expressly articulates independence of the judiciary, and that being
the case, the court cannot direct the length of tenure or other eligibility
conditions which are in the domain of the executive, (which, as a co-
equal organ of governance) is exclusively entitled to prescribe criteria
for selection of tribunal members, therefore, needs careful scrutiny.
3. 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 Parliament1 as well as the states2. 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 323A3 and
323B4 which paved the way for the creation of tribunals as substitutes
1 Entries 77,78 and 79, List I, Seventh Schedule to the Constitution of India.
2 Entry 65, List II, Seventh Schedule to the Constitution of India.
3 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 Union or of any State or of any local or other authority”
4 Which enables setting up of tribunals to adjudicate disputes relating to:
“a) levy, assessment, collection and enforcement of any tax; (b) foreign exchange,
import and export across customs frontiers; (c) industrial and labour disputes; (d) land
reforms by way of acquisition by the State of any estate as defined in article 31A or of any
rights therein or the extinguishment or modification of any such rights or by way of
ceiling on agricultural land or in any other way; (e) ceiling on urban property; (f)
elections to either House of
Parliament or the House or either House of the Legislature
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for courts. Many tribunals5 which were created by legislation introduced
in the 1990s and the decade beginning in 2000 do not conform to the
heads or subject matters enumerated in either of those Articles. Yet,
they were created under the relevant fields of legislation combined with
Entry 11A of the Concurrent List (List III, Seventh Schedule to the
Constitution of India).6
4. The Union’s position that when a legislation or legislative
instrument (such as an ordinance in this case) is questioned, its validity
can be scrutinized only by considering its impact on some express provision
of the constitution, and not on any concept or notion such as separation
of powers and judicial independence, requires examination in the first
instance.
5. There can be no doubt that any enactment or subordinate
legislation can be questioned as offending a constitutional provision.
However, does this articulation preclude a challenge based on principles
which are evident in the constitution, but yet, are not clearly spelt out in
its plain text through any express provision? In the Constitution Bench
judgment of this court in Madras Bar Association v. Union of India7
(“MBA-I”) the issue was whether High Courts could be divested of
their statutory appellate jurisdiction in tax disputes, which they had
been exercising for over 80 years, to confer this jurisdiction on a new
tribunal whose membership was to be different from judges of High
Courts. This court then examined the
applicability of the basic structure
doctrine, of which independence of the judiciary and separation of powers
have been held to be a part, and observed as follows:
of a State, but excluding the matters referred to in article 329 and article 329A; (g)
production, procurement, supply and distribution of food-stuffs (including edible oilseeds
and oils) and such other goods as the President may, by public notification, declare to be
essential goods for the purpose of this article and control of prices of such goods; (h)
rent, its regulation and control and tenancy issues including the right, title and interest
of landlords and tenants; (i) offences against laws with respect to any of the matters
specified in sub-clauses (a) to (h) and fees in respect of any of those matters; (j) any
matter incidental to any of the matters specified in sub-clauses (a) to (i).”
5 The Telecom Disputes Settlement Commission, the Appellate Tribunal for Electricity;
the Securities Appellate Tribunal; Consumer forums and the National Consumer
Disputes Redressal Commission;
6  Entry 11A pertains to ‘Administration of justice, constitution and organisation of all
courts, except the Supreme Court and High Courts’.
7 (2014) 10 SCC 1.
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“113.2. We have given our thoughtful consideration to the
submission advanced at the hands of the learned counsel for
the petitioners insofar as the first perspective is concerned.
We find substance in the submission advanced at the hands
of the learned counsel for 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 : (1976) 2
WLR 366 : (1976) 1 All ER 353 (PC)]. In Hinds case
[Hinds v. R., 1977 AC 195 : (1976) 2 WLR 366 : (1976) 1 All
ER 353 (PC)], it was acknowledged that Parliament was not
precluded from establishing a court under a new name to
exercise the jurisdiction that was being exercised by members
of the higher judiciary at the time when the Constitution came
into force. But when that was done, it was critical to ensure
that the persons appointed to be members of such a court/
tribunal should be appointed in the same manner and should
be entitled to the same security of tenure as the holder of the
judicial office at the time when the Constitution came into
force. Even in the treatise Constitutional Law of Canada by
Peter W. Hogg, it was observed: if a province invested a
tribunal with a jurisdiction of a kind, which ought to properly
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belong to a Superior, District or County Court, then that court/
tribunal (created in its place), whatever is its official name,
for constitutional purposes has to, while replacing a Superior,
District or County Court, satisfy the requirements and
standards of the substituted court. This would mean that the
newly constituted court/tribunal will be deemed to be invalidly
constituted, till its members are appointed in the same manner,
and till its members are entitled to the same conditions of
service as were available to the Judges of the court sought to
be substituted. In the judgments under reference it has also
been concluded that a breach of the above constitutional
convention could not be excused by good intention (by which
the legislative power had been exercised to enact a given
law). We are satisfied, that the aforesaid exposition of law is
in consonance with the position expressed by this Court while
dealing with the concepts of “separation of powers”, the “rule
of law” and “judicial review”. In this behalf, reference may
be made to the judgments in L. Chandra Kumar case [L.
Chandra Kumar v. Union of India, (1997) 3 SCC 261 : 1997
SCC (L&S) 577], as also, in Union of India v. Madras Bar
Assn. [Union of India v. Madras Bar Assn., (2010) 11 SCC 1]
Therein, this Court has recognised that transfer of jurisdiction
is permissible but in effecting such transfer, the court to which
the power of adjudication is transferred must be endured with
salient
characteristics, which were possessed by the court from
which the adjudicatory power 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.”
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6. Likewise, in Dr. D.C. Wadhwa & Ors v. State of Bihar &
Ors,8 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-promulgating ordinances; yet this court ruled that to be the case, and
observed as follows:
“The Executive cannot by taking resort to an emergency power
exercisable by it only when the Legislature is not in Session,
take over the law- making function of the Legislature. That
would be clearly subverting the democratic process which
lies at the core of our constitutional scheme, for then the people
would be governed not the laws made by the Legislature as
provided in the Constitution but by laws made by the Executive.
The Government cannot by-pass the Legislature and without
enacting the provisions of the Ordinance into an Act of the
Legislature, repromulgate the Ordinance as soon as the
Legislature is prorogued. Of course, there may be a situation
where it may not be possible for the Government to introduce
and push through in the Legislature a Bill containing the same
provisions as in the Ordinance, because the Legislature may
have too much legislative business in a particular Session or
the time at the disposal of the Legislature in a particular
Session may be short,
and in that event, the Governor may
legitimately find that it is necessary to repromulgate the
Ordinance. Where such is the case, re-promulgation of the
Ordinance may not be open to attack. But otherwise, it would
be a colourable exercise of power on the part of the Executive
to continue an Ordinance with substantially the same
provisions beyond the period limited by the Constitution, by
adopting the methodology of repromulgation.”
7. The above decision was endorsed in Krishna Kumar Singh v.
State of Bihar9 which also held that re-promulgation “represents an
effort to overreach the legislative body which is a primary source
of law-making authority in a parliamentary democracy.” The court
pointed out that:
8 1987 (1) SCR 198.
9 (2017) 3 SCC 1.
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“The danger of repromulgation lies in the threat which it poses
to the sovereignty of Parliament and the State Legislatures
which have been constituted as primary law-givers under the
Constitution. Open legislative debate and discussion provides
sunshine which separates secrecy of Ordinance-making from
transparent and accountable governance through law-
making.”
8. In a decision of the Privy Council (which has been cited and
approved by decisions of this court, including in Kesavananda Bharati
v. State of Kerala10) viz, Liyanage v. The Queen11 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.”
9. In L. Chandra Kumar v Union of India12 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 and
the “exclusion of jurisdiction” clauses in all other legislations
enacted under the aegis of Articles 323A and 323B would, to
the same extent, be unconstitutional. The jurisdiction conferred
upon the High Courts under Articles 226/227 and upon the
Supreme Court under Article 32 of the Constitution is part of
the inviolable basic structure of our Constitution.”
10 1973 Supp. SCR 1.
11 [1967] 1 AC 259, 287–288.
12 1997 (3) SCC 261
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In Ismail Faruqui v Union of India13 provisions of a Central
enactment14 [Section 4 (3)] which abated all pending legal proceedings
was held to be unconstitutional because: it amounted to “an extinction
of the judicial remedy for resolution of the dispute amounting to
negation of rule of law. Sub-section (3) of Section 4 of the Act is,
therefore, unconstitutional and invalid.”It is therefore, too late in the
day to contend that infringement by a statute, of the concept of
independence of the judiciary - a basic or essential feature of the
constitution, which is manifested in its diverse provisions, cannot be
attacked, as it is not evident in a specific Article of the Constitution.
10. The challenges to executive or legislative measures based on
violation of the twin concepts of separation of powers and independence
of the judiciary have to be seen in terms of their impacts, not at one point
in time, but cumulatively, over a time continuum. This idea was expressed
in Pareena Swarup v. Union of India15 where the court observed that:
“9. It is necessary that the court may draw a line which the
executive may not cross in their misguided desire to take over
bit by bit and (sic) judicial functions and powers of the State
exercised by the duly constituted courts. While creating new
avenue of judicial forums, it is the duty of the Government to
see that they are not in breach of basic constitutional scheme
of separation of
powers and independence of the judicial
function. We agree with the apprehension of the petitioner
that the provisions of the Prevention of Money-Laundering
Act are so provided that there may not be independent judiciary
to decide the cases under the Act but the members and the
Chairperson to be selected by the Selection Committee headed
by Revenue Secretary.
10. It is to be noted that this Court in L. Chandra
Kumar v. Union of India [(1997) 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
13 (1994) 6 SCC 360,
14 the Acquisition of Certain Area at Ayodhya Act, 1993 (No. 33 of 1993)
15 (2008) 14 SCC 107
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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 ensuring that such
Tribunal will be able to command the confidence of the public.
Freedom from control and potential domination of the
executive are necessary preconditions for the independence
and impartiality of Judges. To make it clear that a judiciary
free from control by the executive and legislature is essential
if there is a right to have claims decided by Judges who are
free from potential domination by other branches of
Government. With this background, let us consider the defects
pointed out by the petitioner and amended/proposed
provisions of the Act and the Rules.”
11. The decision in S.P. Sampath
Kumar v. Union of India &
Ors.16 upheld the validity of the Administrative Tribunals Act, 1985 and
the exclusion of High Courts’ jurisdiction under Article 226 of the
Constitution (based on an enabling clause in Article 323A); yet, the
reasoning in the judgments delivered are a clear indicator that this court
would always be careful in considering the efficacy of the body and its
ability to administer justice in a fair and impartial manner, having regard
to the qualifications and experience of its personnel as well as the
safeguards of tenure, salary etc. L. Chandra Kumar v. Union of India
& Ors17,a seven-judge decision, decisively overruled Sampath Kumar
(supra) with respect to the preclusion of jurisdiction of Article 226 of
the Constitution; this Court also declared that judicial review is a part of
16 1987 SCC Supp. 734
17 (1997) 3 SCC 261
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the basic structure of the Constitution. In the next phase, where
amendments were proposed to the Companies Act, 1956 to set up a
National Company Law Tribunal, this Court, by the Constitution Bench
decision in Union of India v. R. Gandhi18 again found several provisions
of enacted Parliamentary law to be objectionable – they are related to
tenure, manner of appointment, qualifications of members etc. Likewise,
in Madras Bar Association v Union of India (MBA-I) (supra), the
complete divesting of High Courts’ jurisdiction under tax enactments
(income tax, customs, central excise and service tax etc) and
parliamentary setting up of a National Tax Court was held to be
unconstitutional. Here again, the court  highlighted the quality of justice
expected from such bodies and underlined that the divestment of such
jurisdiction was prohibited by the Constitution. Madras Bar
Association19 (“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 Mathew20 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 India21 (“MBA-III”) held that rules framed in
2020 were invalid as regards the tenure of members of tribunals,
constitution of the mechanism for their selection, lack of any substantive
rules for their re-appointment, etc.
12. In all these decisions, this court’s scrutiny was based upon its
role as the guardian of the constitution and, more specifically,
independence of the judiciary. If one were asked to pinpoint any specific
provision of the constitution that this court relied upon while holding the
enacted provisions to be falling afoul of, there would be none. It is too
18 (2010) 11 SCC 1
19 (2015) 8 SCC 583.
20  (2020) 6 SCC 1.
21 2020 SCC OnLine SC 962.
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late now to contend that independence of the judiciary and separation of
powers are vague concepts based on which Parliamentary re-
enactment cannot be invalidated. 
13. The role of this court in considering whether or not provisions
of law or executive policies are in consonance with the Constitution
is well recognized and cannot be overemphasized. The Attorney
General’s assertion that the executive or indeed the Parliament acts within
its rights in interpreting the Constitution, and therefore this court should
adopt a deferential standard in matters of policy are therefore insubstantial,
and also disquieting. As conceded by the Union, if a law (passed validly
in exercise of its exclusive power by the Parliament on its interpretation
of the Constitution) violates any express provision or principle that lies at
the core of any express provision or provisions, this Court’s voice is
decisive and final. 
14. Pertinently, in matters of independence of the judiciary
or arrangement of courts or tribunals, when these provisions come up
for interpretation, this court would apply a searching scrutiny standard
in its judicial review to ensure that the new body, court, tribunal,
commission or authority created to adjudicate (between citizens and
government agencies or departments, citizens and citizens, or citizens
and corporate entities) are efficient, efficacious and inspire public
confidence. The role of courts in considering a provision of law setting
up
adjudicatory bodies, was recognized in R.K. Jain v. Union of India22
in the following terms: 
“The faith of the people is the bed-rock on which the edifice
of judicial review and efficacy of the adjudication are
founded. The alternative arrangement must, therefore, be
effective and efficient. For inspiring confidence and trust in
the litigant public they must have an assurance 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
22 1993 (3) SCR 802
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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. In built experience would play vital
role in the administration of justice and strengthen and
develop the qualities, of intellect and character, forbearance
and patience, temper and resilience which are very important
in the practice of law. Practising Advocates from the Bar
generally do endow with those qualities to discharge judicial
functions. Specialised nature of work gives them added
advantage and gives benefit to broaden the perspectives.
“Judges’’ by David Pannick (1987 Edition), at page 50, stated
that, “we would not allow a man to perform a surgical
operation without a thorough training and certification of
fitness. Why not require as much of a trial judge who daily
operates on the lives and fortunes of others”. 
15. It would be useful to notice that whenever Parliament creates
tribunals with exclusive jurisdiction, the parent enactment or law
invariably bars the jurisdiction of ordinary civil courts.23 This in my opinion
is the clearest indicator of the fact that but for such provisions and the
creation of such exclusive bodies, civil courts would of necessity have
enjoyed jurisdiction to adjudicate disputes arising out of such new
23 Section 293, Income Tax Act; Section 20A of the Securities and Exchange Board of
India Act, 1992; Section 18, the Recovery of Debts and Bankruptcy Act, 1993; Section
34 of the Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002;Section 268, Companies Act, 2013; Section 231 of the
Insolvency and Bankruptcy Code, 2016; Section 56, Petroleum and Natural Gas
Regulatory Board Act, 2006; Section 154, Electricity Act, 2003; Section 27 of the
Telecom Regulatory Authority of India Act, 1997; Section 61 of the Competition Act,
2002.
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legislation24. This underscores the fact that the appropriate legislature
wishes those disputes arising from such new legislation not to be
adjudicated by civil courts: which otherwise would have possessed
jurisdiction over them. Such disputes may include issues such as refund
of excess amounts claimed as tax, private disputes between two licensees
under a statutory regime such as telecom or electricity laws etc.,
consumer disputes, liability to banks and financial institutions, and so on.
16. Parliament has, over the years, created several tribunals and
commissions which exercise judicial functions that would ordinarily fall
within the jurisdiction of courts; they would also have been subjected to
the supervisory jurisdiction of High Courts under Article 227. This gradual
“hiving off” of jurisdiction from the courts, therefore, calls for a careful
and searching scrutiny to ensure that those who approach these bodies
are assured of the same kind and quality of justice, infused with what
citizens expect from courts, i.e., independence, fairness, impartiality,
professionalism and public confidence. These considerations are relevant,
given that “policy” choices adopted by the executive or legislature in
the past, when it concerned dispensation of justice through courts, were
the subject matter of scrutiny under judicial review by courts.
17. 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.P25, 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.... These provisions
24 Section 9 of the Civil Procedure Code
25 1967 (1) SCR 77
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indicate that the duty to consult is so integrated with the
exercise of the power that the power can be exercised only in
consultation with the person or persons designated therein.”
To the same effect are the decisions in Chandramouleshwar
Prasad v. Patna High Court26 and many other judgments.27 In State of
Bihar v Bal Mukund Sah28 it was held that:
“the framers of the Constitution separately dealt with Judicial
Services of the State and made exclusive provisions regarding
recruitment to the posts of District Judges and other civil
judicial posts inferior to the posts of the District Judge. Thus
these provisions found entirely in a different part of the
Constitution stand on their own and quite independent of part
XIV dealing with Services in general under the State. Therefore,
Article 309, which, on its express terms, is made subject to
other provisions of the Constitution, does get circumscribed
to the extent to which from its general field of operation is
carved out a separate and exclusive field for operation by
the relevant provisions of Articles dealing with Subordinate
Judiciary as found in Chapter VI of Part VI of the
Constitution.”
18. This court, therefore, as the ultimate guardian of the
Constitution, and the rule of law, which it is sworn to uphold, has been
asserting its role in regard to matters of appointment, and other conditions
of service of judges of district and other courts. Since tribunals
function
within the larger ecosystem of administration of justice, and essentially
discharge judicial functions, this court is equally concerned with the
qualifications, eligibility for appointment, procedure for selection and
appointment, conditions of service, etc of their members. This court’s
concern, therefore, is unlike any other subject matter of judicial review.
It cannot be gainsaid that if tenures of tribunals’ members are short: say
two years, or if their salaries are pegged at unrealistically low levels, or
if their presiding members are given no administrative control or powers,
26 (1969) 3 SCC 56
27 State of Kerala v. A. Lakshmikutty and Ors. 1987 (1) SCR136 where the court
emphasized that the Constitution required the Governor to have a “real, full and
effective consultation” with the High Court in the matter of appointment of District
judges; M.M. Gupta and Ors. v. State of Jammu and Kashmir & Ors (1982) 3 SCC 412.
28 (2004) 4 SCC 640.
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the objective of efficient, fair, and impartial justice delivery would be
defeated. It cannot then be argued that each of these are “policy” matters
beyond the court’s domain.
19. Ordinarily in pure “policy” matters falling within Parliamentary
or executive domain, such as economic, commercial, financial 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 kinds of justice: one through courts, and one through other
bodies. The quality and efficacy of these justice delivery mechanisms
have to be the same, i.e., the same as that provided by courts, as
increasingly, tribunals adjudicate disputes not only between state agencies
and citizens, but also between citizens and citizens as well as citizens
and powerful corporate entities. Therefore, it is the “equal protection”
of laws29, guaranteed to all persons, through institutions that assure the
same competence of its personnel, the same fair procedure, and the
same independence of adjudicators as is available in existing courts, that
stands directly implicated. Consequently, when this court scrutinizes any
law or measure dealing with a new adjudicatory mechanism, it is through
the equal protection of law clause under Article 14 of the Constitution.
20. With these observations, I proceed to deal with the minimum
age requirement (hereafter called “age qualification”) which precludes
otherwise qualified candidates possessing the requisite experience from
appointment to all tribunals, unless they are 50 years of age or older.
29 Under Article 14 of the Constitution of India
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This age qualification is that candidates, to be appointed, should not be
less than 50 years, and has been introduced by the first proviso to
Section 184 (1) of the Finance Act. What is immediately noticeable is
that this age qualification (more by way of an age bar or minimum age
requirement) did not find place in any parent enactment30, which set out
the eligibility conditions for appointments to various tribunals, with the
exception of appointment as members to the National Company Law
Tribunal, for which, candidates should have completed 50 years to be
eligible for appointment, apart from the prescribed eligibility and condition
criteria. Such age criteria was not enacted under the provisions of the
Finance Act, 2017; nor was it introduced in the 2017 Rules (which were
invalidated by Rojer Mathew). An indirect age barrier, for the first time
was introduced in the 2020 Rules framed under the Finance Act, 2017,
in the form of the requirement of otherwise qualified advocates and
chartered accountant candidates having to possess 25 years of practice.
This court held that requirement 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.
21. The challenge to the first proviso to Section 184, which
prescribes the age qualification, has to be seen from several angles. 
First, the underlying parent statutes which created the tribunals (ITAT,
30  Income Tax Act, 1961, Customs Act, 1962, Securities Exchange of India Act, 1992,
Electricity Act, 2003, etc.
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CESTAT, TDSAT, CAT) did not prescribe, as an eligibility criterion for
selection of candidates as members, any minimum age. The prescription
of 50 years as a minimum eligibility criterion, in the opinion of this court,
is without any rationale. The ITAT has existed for the last 79 years; no
less than 33 of its members were appointed as judges of various High
Courts; one of them (Ranganathan,  J.) was appointed to this court. The
CESTAT 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. The Constitution of India makes an advocate who has practiced
for more than 10 years, eligible for consideration for appointment as a
judge of the High Court and even this Court. An advocate with 7 years’
practice with the Bar can be considered for appointment to the position
of a District Judge. 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). 
The exclusion of such eligible candidates in preference to those who are
more than 50 years of age is inexplicable and therefore