J U D G M E N T

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

1 | Pa ge 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.”

1 (2010) 11 SCC 1 2 (2014) 10 SCC 1

3 (2020) 6 SCC 1

4 (2020) SCC Online SC 962

2 | Pa ge

3. The vires of the Administrative Tribunals Act, 1985, enacted under Article 323-A (1), was challenged in S.P. Sampath Kumar v. 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

5 (1987) 1 SCC 124 6 (1980) 3 SCC 625 7 (1997) 3 SCC 261

3 | Pa ge 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 jurisdi