1. Writ petition seeking directions to fill judicial vacancies and extend terms of members of the National Company Law Tribunal and Appellate Tribunal under the Companies Act. (Para 1 )
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2021 Supreme(SC) 737
SUPREME COURT OF INDIA
L. NAGESWARA RAO, HEMANT GUPTA, S. RAVINDRA BHAT, JJ.
NATIONAL COMPANY LAW TRIBUNAL AND APPELLATE TRIBUNAL BAR ASSOCIATION THROUGH ITS SECRETARY - Petitioners
Vs.
MINISTRY OF CORPORATE AFFAIRS & ORS. - Respondents
Writ Petition(s)(Civil) No(s).510/2021
Decided on : 31-05-2021
Important Points
The Supreme Court directed the Government to expeditiously fill vacancies and complete the reappointment process for members of the NCLT and NCLAT within two months to ensure the smooth functioning of the Tribunals and prevent detrimental depletion of their sanctioned strength.
Subject
Administrative Law - Appointment and Removal of Judicial Officers
Act Referred
COMPANIES ACT: S.413
Headnote
Company’s Act 2013 - Section 413 - Sought a direction to extend term of six Members - Sought to issue letters of appointment - Entitled for reappointment - Matter was listed learned Additional Solicitor General submitted that process for appointment of candidates who have been selected pursuant to the procedure which was initiated shall be expedited and orders of appointment shall be issued soon - Process to be initiated for filling up the existing vacancies, a search cum Selection Committee has to be constituted and we direct that Selection Process shall be initiated at earliest - Members of NCLT and NCLAT who are completing their tenure concerned, learned Attorney General for India refers to Section 413 of Company’s Act 2013 according to which President or other members of Tribunal shall hold office for a period of 5 years and shall be entitled for reappointment for another term of 5 years – Held, Appointment being initiated immediately but requested that members who are completing their tenure should be permitted to continue till process of reappointment is completed - He brought to our notice that there are 39 members at present for a sanctioned strength of 63 and depletion of the strength of members will adversely affect smooth functioning of Tribunals - Government has already initiated the process of reappointment by writing to Hon’ble Chief Justice – Court trust and hope that reappointment process should be completed expeditiously, as there is no necessity of issuance of any advertisement for participation of other eligible candidates. Reappointment of members can be considered separately without waiting for process of fresh appointments to commence - Strength of members of NCLT and NCLAT is depleting which would be detrimental to smooth functioning of Tribunals – Court direct Government to complete process at earliest and not later than two months - Writ petition disposed of.
Legal Category Hierarchy
Advocates Appeared:
For the Petitioners: Mr. A.S. Chandhiok, Sr. Adv., Mr. Virender Ganda, Sr. Adv., Mr. Ajay Kumar Jain, Adv, Mr. Rakesh Kumar, Adv, Mr. Vipul Ganda, Adv, Mr. Vishal Ganda, Adv, Mr. Satyajit A. Desai, Adv., Mrs. Anagha S Desai, AOR, Ms. Aastha Trivedi, Adv, Ms. Guresha Bhamra, Adv, Mr. Tejasvi Chaudhry, Adv, Mr. Satya Kam Sharma, Adv.
For the Respondents: Mr. KK Venugopal, Ld. AG, Mr. Balbir Singh, Ld. ASG, Mr. R. Balasubramanium, Sr. Adv., Mr. Zoheb Hossain, Adv, Ms. Shradha Deshmukh, Adv., Ms. Chinmayee Chandra, Adv., Mr. Shyam Gopal, Adv., Mr. Ankur Talwar, Adv., Ms. Suhasini Sen, Adv., Mr. Gurmeet Singh Makker, AOR
For the Petitioners: Mr. A.S. Chandhiok, Sr. Adv., Mr. Virender Ganda, Sr. Adv., Mr. Ajay Kumar Jain, Adv, Mr. Rakesh Kumar, Adv, Mr. Vipul Ganda, Adv, Mr. Vishal Ganda, Adv, Mr. Satyajit A. Desai, Adv., Mrs. Anagha S Desai, AOR, Ms. Aastha Trivedi, Adv, Ms. Guresha Bhamra, Adv, Mr. Tejasvi Chaudhry, Adv, Mr. Satya Kam Sharma, Adv.
For the Respondents: Mr. KK Venugopal, Ld. AG, Mr. Balbir Singh, Ld. ASG, Mr. R. Balasubramanium, Sr. Adv., Mr. Zoheb Hossain, Adv, Ms. Shradha Deshmukh, Adv., Ms. Chinmayee Chandra, Adv., Mr. Shyam Gopal, Adv., Mr. Ankur Talwar, Adv., Ms. Suhasini Sen, Adv., Mr. Gurmeet Singh Makker, AOR
Table of Contents
2. Request for extension of tenure of members to prevent depletion of strength versus government submission regarding the initiation of the reappointment process. (Para 3 , 4 , 5 )
3. Depletion of member strength is detrimental to tribunal functioning; reappointment processes are distinct from fresh appointments and should be completed expeditiously. (Para 6 )
4. Government must expeditiously complete the reappointment process for tribunal members to prevent depletion of strength and ensure smooth functioning of the judicial body. (Para 6 )
5. Government directed to complete the process of appointment and reappointment of tribunal members within two months. (Para 2 , 6 , 7 )
6. What is the tenure and reappointment provision for the President or members of the NCLT and NCLAT?
Under Section 413 of the Companies Act 2013, the President or other members of the Tribunal shall hold office for a period of five years and are entitled to reappointment for another term of five years. (Para 3 )
7. Can the reappointment of tribunal members be handled separately from the process of fresh appointments?
Yes, the court held that the reappointment of members can be considered separately without waiting for the process of fresh appointments to commence. (Para 6 )
8. Why did the court direct the expedited completion of the reappointment process for tribunal members?
The court observed that the depletion of the strength of members would be detrimental to the smooth functioning of the Tribunals. (Para 6 )
ORDER :
1. The National Company Law Tribunal and Appellate Tribunal Bar Association has filed this Writ Petition seeking a direction to the respondent to fill up the vacancies of Chairman, NCLAT and President of NCLT without any further delay. A further direction was sought to issue letters of appointment to the candidates pursuant to the Selection procedure initiated in 2019 and to fill up the remaining vacancies of Members of NCLT and NCLAT. The petitioner has also sought a direction to extend the term of six Members of the NCLT and NCLAT for a further period of five years as they are completing the tenure by June, 2021.
2. When the matter was listed on 24.05.2021, Mr. Balbir Singh, learned Additional Solicitor General submitted that the process for appointment of candidates who have been selected pursuant to the procedure which was initiated in 2019 shall be expedited and orders of appointment shall be issued soon. In respect of the process to be initiated for filling up the existing vacancies, a search cum Selection Committee has to be constituted and we direct that the Selection Process shall be initiated at the earliest.
3. In so far as the extension of the term of the Members of the NCLT and NCLAT who are completing their tenure in June, 2021 is concerned, the learned Attorney General for India refers to Section 413 of the Company’s Act 2013 according to which the President or other members of the Tribunal shall hold office for a period of 5 years and shall be entitled for reappointment for another term of 5 years. He submitted that the government has initiated the process for reappointment by requesting the Hon’ble the Chief Justice of India to constitute a committee for the purposes of the reappointment of members to the NCLT and NCLAT.
4. Mr. Amarjit Singh Chandhiok, learned senior counsel appearing for the petitioner submitted that he cannot have any objection to the process of re-appointment being initiated immediately but requested that the members who are completing their tenure should be permitted to continue till the process of reappointment is completed. He brought to our notice that there are 39 members at present for a sanctioned strength of 63 and the depletion of the strength of the members will adversely affect the smooth functioning of the Tribunals.
5. Mr. Amarjit Singh Chandhiok, learned senior counsel was supported by Mr.Pradeep Rai, and Mr.Ajay Jain who argued that the members who are completing their tenure should be permitted to continue in the interest of justice and for the smooth functioning of the Tribunals.
6. As the Government has already initiated the process of reappointment by writing to the Hon’ble Chief Justice, we trust and hope that the reappointment process should be completed expeditiously, as there is no necessity of issuance of any advertisement for participation of other eligible candidates. Reappointment of members can be considered separately without waiting for the process of fresh appointments to commence. As the strength of the members of the NCLT and NCLAT is depleting which would be detrimental to the smooth functioning of the Tribunals, we direct the Government to complete the process at the earliest and not later than two months.
7. Writ petition and pending applications, if any, shall stand disposed of.
