[2020 Tribunal Rules] SC Judgments Requiring 5-7 Yrs Tenure Don't Apply Where Right Of Re-Appointment Contemplated: AG Defends 4 Yr Term

The Bench of Justices L. Nageswara Rao, Hemant Gupta and Ravindra Bhat are hearing the matter.

After Senior Advocate Arvind Datar, for the Madras Bar Association concluded his rejoinder submissions, AG K. K. Venugopal began by advancing that by the operation of section 175 of the Finance Act 2017, a new sub-section (7) came to be added to section 129 of the Customs Act, stipulating that the qualifications, appointment, tenure, salaries, removal and terms and conditions of service of the presiding officer and the members of the CESTAT shall be governed by section 184 of the Finance Act.

"Section 175 says two things- that from the date of commencement of part 14 of Chapter 6 of the Finance Act (AMENDMENTS TO CERTAIN ACTS TO PROVIDE FOR MERGER OF TRIBUNALS AND OTHER AUTHORITIES AND CONDITIONS OF SERVICE OF CHAIRPERSONS, MEMBERS, ETC.), the qualification, appointment and tenure will be governed by section 184. And for appointments made before the appointed day, the old Rules shall hold fort", he explained.

"Sections 183 and 184 of the Finance Act are the single most important ingredients..it is clear that on and from the appointed day, whatever rules are framed under 184, they shall apply. But they won't apply to those who were holding office immediately before the appointed day...so Mr. Datar's fears are wholly unjustified", he advanced.

"Further, the proviso to section 184 provides that the chairman and the other members shall hold office for a term as may be determined by the central government by any rules framed in this behalf, but such term may not be more than 5 years, or until the age of 70 years, in the case of the chairman, and 67 years, in the case of other members, whichever is earlier. This provision even contemplates re-appointment if found so eligible. 184 was challenged and upheld in entirety. It was given to exhibit that rules may so be framed such that the tenure does not exceed 5 years...if a lawyer, economist or other person is to be appointed before 25 years of experience - assuming they enter the profession at the age of 22-23 and are appointed after only 10-15 years of experience - then after just 5 years, their term would end and they would go away...so 4 years is a reasonable period to ask, when they are being given the right of reappointment till the maximum age of 70 or 65...4 years is a sufficient tenure to understand how competent the member is, whether the orders delivered by him are upheld by the appellate authorities, whether there is delay in rendering judgments, whether he is coming late- these are the parameters for reappointment....judgments of the Supreme Court which said that the tenure must be between 5-7 years do not apply where there is a right of reappointment at the behest of a Search Cum Selection Committee headed by a SC judge! And if a member is not found deserving of re-appointment based on the track record, then the SC judge shall control the affairs of the committee, as the secretary to a government cannot be expected to stand up and oppose him", he argued.

"As the Tribunal, Appellate Tribunal and other Authorities (Qualification, Experience and other Conditions of Service of Members) Rules, 2017 have been struck down and several directions have been issued vide the majority judgment for framing of fresh set of Rules, we, as an interim order, direct that appointments to the Tribunal/Appellate Tribunal and the terms and conditions of appointment shall be in terms of the respective statutes before the enactment of the Finance Bill, 2017. However, liberty is granted to the Union of India to seek modification of this order after they have framed fresh Rules in accordance with the majority judgment.", Mr. Venugopal quoted from Roger Mathews. He pointed out that it was held that "in case any additional benefits concerning the salaries and emoluments have been granted under the Finance Act, they shall not be withdrawn and will be continued. These would equally apply to all new members."

"It has been ensured again and again that no person appointed shall be deprived of any benefits which are better than those in the 2020 Rules! So no one can complain", insisted the AG.

It may be noted that earlier in the day, Senior Advocate Arvind Datar for the Madras Bar Association had argued that members of tribunals, who are retired HC and SC judges, cannot be expected to hunt for houses post retirement and accordingly, the same must be provided, as it discourages good candidates from taking up the posts in the tribunals.

In response, the AG cited from the Roger Mathews judgment that " there can be no doubt that executive action cannot confer status equivalent to that of either Supreme Court or High Court judges on any member or head of any Tribunal or other judicial fora"

"Even members are asking that since they are retired HC judges, they be given housing", remarked the AG.

He read further from Roger Mathews: "Furthermore, that even though manned by retired judges of High Courts and the Supreme Court, such Tribunals established under Article 323-A and 323-B of the Constitution cannot seek equivalence with High Courts or the Supreme Court. Once a judge of a High Court or Supreme Court has retired and he/she no longer enjoys the Constitutional status, the statutory position occupied by him/her cannot be equated with the previous position as a High Court or a Supreme Court judge. The rank, dignity and position of Constitutional judges is hence sui generis and arise not merely by their position in the Warrant of Precedence or the salary and perquisites they draw, but as a result of the Constitutional trust accorded in them. Indiscriminate accordance of status of such Constitutional judges on Tribunal members and presiding officers will do violence to the very Constitutional Scheme"

"So they can't expect housing and to be treated like judges. They should get their own houses like other members...In tribunals, where the members are retired judges, they use the prefix 'Justice'. If I dont address them as 'My Lords', they won't be happy with me...If Your Lordships make a remark that this is unnecessary, then lawyers would not be worried", he advanced, in a lighter note.

There was a brief talk on how some bar associations have suggested dropping the use of "My Lord" to address even HC and SC judges, and how the full court of the Rajasthan HC had passed a resolution last year doing away with the practice. "At least one of us (referring to Justice Bhat) didn't want to be so addressed, even when in the HC...We don't insist on it. It is the habit of the lawyers...", said Justice Rao in good humour. Senior Counsel C. S. Vaidyanathan also chipped in that Justice Bhat and Justice S. Muralidhar, while at the Delhi High Court, had asked not to be addressed as "My Lord"

"I consider it prudent...I always begin with 'May I please Your Lordships'...it gives time to collect the thoughts...But I think 'sir' would be the best", remarked the AG in a lighter vein.

"It is jokingly said that if you take away "My Lord", then hardly anything would remain in an argument", commented Justice Gupta.

Next, the AG moved to discuss the composition of the Search-Cum-Selection Committee: "It is to comprise the CJI himself or his nominee judge, the Chairperson of the tribunal/or the outgoing Chairperson, and two secretaries to the government. The Chairperson would be appointed directly by the SCSC and therefore, would be wearing the garb of the judiciary and would go with the Presiding Judge...I don't think the secretary to the government would consider going against the conscious decision of the Presiding Judge...", he began.

"There are 19 tribunals in total, and every other day a member retires...even a chairman or a vice-chairman retires frequently...Would Your Lordships spare two judges of the SC or the HC or a CJ of the HC to constantly spend time on ensuring that vacancies are filled up without delay? Would that not result in loss of time meant for judicial adjudication for the benefit of lawyers and litigants? So I submit that the SCSC should have 1 SC judge, the Chairperson, who would be having judicial experience, and two secretaries...amending Rules to have two judges on the Committee to provide for a casting vote in the event of a 2: 2 vote, which never happens, can be avoided...", he submitted.

As regards the appointment of members of the ILS as judicial members in Tribunals, the AG pointed out that the present incumbent Director of Prosecution is a member of the ILS. He explained that DRTs are manned by a single member, and therefore, one who is or has been a district judge is deemed suitable for appointment. Further, ILS members are excluded from being appointed to the Appellate Tribunal as it is supposed to sit over the decision of a district judge, and so only a retired HC judge is considered appropriate. "Advocates are not considered for the DRT, the Airports Appellate Tribunal and even for Film Certification, which is a highly specialised field", he added.

As regards the plea that 25 years of substantial experience in the relevant field before the HC, the SC or the concerned Tribunal is unreasonable considering that some tribunals like the NGT, TDSAT, SEBI Appellate Tribunal, APTEL have not even been in existence that long, the AG explained, "The topic on which these tribunals are constituted, like environment, securities etc, have been in existence since years and the HCs and the SC have been dealing with them...that experience will be looked at. We don't want 25 years in the particular subject or the field. 5 years in the subject is enough so long as he has done related cases".

As regards the date of applicability of the 2020 Rules, whose purported retrospective application is being challenged, the AG indicated section 183 of the Finance Act to submit that notwithstanding anything to the contrary contained in any of the 19 parents Acts under which the tribunals are constituted, on and from the appointed day, the provision of section 184 shall apply in matters of appointment, qualifications, removal, tenure, salaries and terms and conditions of service. "So 184 Rules, when made, shall apply", said the AG.

"Section 157 says that the 'appointed day' shall be such as is fixed by the Central government by notification...which was 26.5.2017...so by virtue of 183, the rules framed under 184 shall operate from then...it is not like a rule was framed to make these Rules apply retrospectively, but the Act itself provides that whenever the Rules are made, they shall apply from this previous date", he explained.

"The 2017 Rules were struck down in entirety in November, 2019. The new Rules had not been made. There was a total vacuum.. Your Lordships had to make some provision for that, so it was said, by way of an interim order, that until the new Rules are framed, the old Rules shall apply, i.e. the 19 different Acts. But liberty was granted to the UOI to seek modification of this order after fresh rules are framed", he insisted.

"So now a modification of this order is sought?", asked Justice Rao.

"No...So far as the old Rules are concerned, by virtue of section 183, they fill the void from the appointed date. 183 was not challenged and 184 has been upheld...the result is that those appointed under the respective Acts prior to 26.5.2017 will continue on the same conditions of service", he replied.

"Because of 183 proviso?", asked Justice Bhat. The AG replied in the affirmative.

"Those appointed under the 2017 struck-down Rules will still continue to be entitled to all the terms of service which are more beneficial than the present rules. if the 2020 rules are more beneficial on certain aspects, those conditions shall be applied to them", he continued.

"But we don't know how many of such members there are. Not all are before us...we don't have a clear picture', pointed out Justice Bhat.

"144-145. we are told. We can put the figure in the written submissions", assured the AG.

"What would be the position of those appointed under the statutes?", asked Justice Rao.

"Each appointment order says that it is subject to the outcome of this petition", replied the AG.

"I am sorry, not a single order says that '', interjected Mr. Datar.

At this point, Mr. Vaidyanathan backed the AG, saying that his clients' appointment order says so. The AG also drew the bench's attention to the proclamation in the order: "The President of India pleased to appoint as Member (Judicial) to the  Appellate Tribunal at a salary of Rs. 2,25,000. The appointment shall be subject to the final outcome in WP No."

"The Finance Act is meant to crate a uniform set-up as regards appointment, terms and conditions of service, points of integration; to amalgamate the Rules and bring uniformity and create one homogenous set-up for all tribunals post 26.5.2017...all appointments made before 26.5.2017 shall continue under the old Acts and Rules. The 2017 Rules came into force on the appointed day. So far as the appointments made under these Rules are concerned, Roger Mathws says that though the rules have been struck down, the members appointed under them shall continue to be entitled to additional benefits in terms of salaries and emoluments ...under the interim order, the old Rules were to only apply in the period when there was a vacuum, a void. But the new Rules of 2020 shall come into force from the appointed day, regardless of the date of their making. But if any other additional benefits, by way of a better salary or emoluments, were granted earlier, they shall continue even now", summarised the AG.

"Only salaries and emoluments? Not on other aspects?", asked Justice Rao.The AG replied in the negative.

Pressing the case for appointment of ILS officers as judicial members, he continued, "They have 13 years' experience as advocates before they are appointed as ILS officers. They are advocates. Then they procure additional legal experience as AORs, in instructing senior counsel, and as PPs...Graduating at the age of 23, with 13 years' experience as an advocate, they come at par with the additional secretary to the government ", he advanced.

"You want them as judicial members? How will you override the two constitution bench judgements?", asked Justice Rao.

"Sampath Kumar is the authority on this, The others didn't even notice that ILS members have 13 years' experience as advocates behind them", replied the AG.

He relied on Sundeep Kumar Bafna to submit that a decision or judgment can be per incuriam any provision in a statute, rule or regulation, which was not brought to the notice of the Court, and that decision or judgment can also be per incuriam if it is not possible to reconcile its ratio with that of a previously pronounced judgment of a Co-equal or Larger Bench.

Indicating Sampath Kumar, he submitted that even a secretary to the government can be vice-chairman, who, after two years' of experience as such, can be made chairman.

Quoting from Sampath Kumar, the AG recited, "Sub-section (3) prescribes the qualification of a judicial member and requires that: (a) he should be or should have been or qualified to be a Judge of a High Court; or (b) has been a member of the Indian Legal Service and has held a post in Grade I of that service for at least three years".

"So he can become the Chairman and even go up to the Appellate Tribunal", explained the AG.

"So far as the Chairman is concerned, the court (in Sampath Kumar) was of the view that ordinarily a retiring or retired Chief Justice of a High Court or when such a person is not available, a Senior Judge of proved ability either in office or retired should be appointed. The Court said that that office should for all practical purposes be equated with the office of Chief Justice of a High Court. The decision points out that there is no bias, in any manner, against members of the Service, that some of them do exhibit great candor, wisdom, capacity to deal with intricate problems with understanding, detachment and objectiveness. The Court had only said that nevertheless, judicial discipline generated by experience and training in an adequate dose is a necessary qualification for the post of Chairman. The bench had agreed that a Vice-Chairman with these qualifications and experience of two years may be considered for appointment as Chairman", explained the AG.