Tribunal Reforms Act 2021 Overhaul: New Bill Proposes Single Appointments Body and Five-Year Terms for Tribunals in India
The bill responds to repeated court strictures on executive control over tribunal appointments.
Key points
- A National Tribunals Commission, chaired by a sitting or retired Supreme Court judge, would make all appointments to central tribunals and administer their budgets and staff.
- Members would serve fixed five-year terms with eligibility for one reappointment, replacing the four-year term the Supreme Court objected to in 2021.
- The minimum age of fifty for advocate-members would go; ten years' practice would qualify.
NEW DELHI — Five years after Parliament re-enacted, over the Supreme Court's objection, the four-year tenure and the minimum age of fifty for tribunal members, the Union has introduced a bill to replace the Tribunals Reforms Act, 2021 with a framework the court has been asking for since 2010: a single independent body to appoint, administer and discipline the members of every central tribunal, and tenures long enough for them to act without an eye on reappointment.
"Independence is not a favour the executive grants. It is a condition of legitimacy," a senior advocate who has argued the tribunal cases in the Supreme Court told The Counsel.
How the 2021 Act came to be
Tribunals exercise judicial power transferred from the courts, and the Supreme Court has held since L. Chandra Kumar (1997) that they must be as independent as the courts they replace. The principle has produced a long sequence of judgments striking down the rules under which the government has tried to staff them: Madras Bar Association (2010) on the National Company Law Tribunal, Madras Bar Association (2014) on the National Tax Tribunal, Rojer Mathew v. South Indian Bank (2019) on the rules framed under the Finance Act, 2017, and Madras Bar Association (2020) on the 2020 rules. In each the court objected to executive-dominated selection committees, short tenures, reappointment at the government's pleasure and administrative control by the sponsoring ministry, and in each it directed a tenure of five years and a search-cum-selection committee with a judicial majority.
In April 2021 an Ordinance fixed the tenure at four years and the minimum age at fifty. The court struck both down in July 2021 in a further Madras Bar Association case. Parliament passed the Tribunals Reforms Act, 2021 the following month with the same provisions, abolished nine tribunals including the Intellectual Property Appellate Board, and transferred their work to the High Courts. The Act was challenged immediately; the court expressed its displeasure, directed the government to fill vacancies, and has kept the petition pending while the tribunals have operated under a statute it had, in substance, already found wanting.
What the bill proposes
- A National Tribunals Commission. A statutory body chaired by a sitting or retired Supreme Court judge, with two retired High Court Chief Justices, the Law Secretary and an expert member, to recommend appointments to every central tribunal, administer their budgets, premises and staff, and receive complaints against members. The sponsoring ministries lose their role in both appointment and administration.
- Five-year terms. Chairpersons and members would serve five years, with eligibility for one further term on the Commission's recommendation, and age limits of seventy for chairpersons and sixty-seven for members.
- Eligibility. Advocates with ten years' practice, district judges with specified service and High Court judges would be eligible for judicial membership; the minimum age of fifty would go. Technical members would need the domain experience the parent statute prescribes.
- Removal. Only on the Commission's recommendation after an inquiry conducted by a judge, in place of removal by the government after consultation.
- Uniform conditions. Salaries and allowances pegged to High Court judges for chairpersons and to the senior-most civil service grades for members, fixed by the Act rather than by rules.
Independence is not a favour the executive grants. It is a condition of legitimacy.
A senior advocate, to The Counsel
What the bill does not do
It does not revive the abolished tribunals; the government's position is that the High Courts have absorbed their work, though intellectual property practitioners dispute it. It does not extend to state tribunals, which remain under state law. And it leaves the Commission's regulations, including the procedure for selection, to be framed with the government's approval, a feature that the bar has already flagged as the point at which the next round of litigation will begin.
Why now
Three pressures converged. The Supreme Court's hearings on vacancies had become a recurring embarrassment, with the court on occasion naming the tribunals operating at half strength. The insolvency and tax tribunals, whose delays have a measurable cost to the economy, had become the subject of complaints from the government's own economic ministries. And the pending challenge to the 2021 Act carried the risk of a judgment striking it down without a replacement in place. The bill is the government's attempt to write the court's requirements into statute before the court does it for them.
Timeline
- 1997 — L. Chandra Kumar: tribunals must be independent and subject to High Court review.
- 2010 — Madras Bar Association: National Tribunals Commission first recommended.
- 2019 — Rojer Mathew: 2017 rules struck down; Union directed to reframe.
- 2021 — Ordinance struck down in July; Tribunals Reforms Act passed in August with the same provisions.
- 2026 — Replacement bill introduced.
What did the Tribunals Reforms Act, 2021 do?
It abolished nine appellate tribunals, transferring their work to the courts, and set uniform conditions for members of the remaining central tribunals: search-cum-selection committees, a four-year term, a minimum age of fifty, and removal and allowances by rules — re-enacting provisions of an Ordinance the Supreme Court had struck down.
Why has the Supreme Court repeatedly struck down tribunal rules?
Because tribunals exercise judicial power and must be independent of the executive. The Madras Bar Association cases and Rojer Mathew held that executive-controlled appointments, short tenures, discretionary reappointment and ministry control undermine that independence, and directed five-year tenures, judicial majorities in selection and a single nodal body.
What is the National Tribunals Commission?
An independent body, first recommended in 2010, to appoint members of all central tribunals, administer their budgets and staff, and handle complaints and removals. The new bill proposes to create it.
How many central tribunals are there?
Around sixteen after the 2021 abolitions, including the NCLT and NCLAT, the Income Tax Appellate Tribunal, CESTAT, the Central Administrative Tribunal, the Armed Forces Tribunal, the National Green Tribunal, the Securities Appellate Tribunal, the Debts Recovery Tribunals and TDSAT.
The Counsel will report the bill's reference to a standing committee and the Supreme Court's response in the pending challenge to the 2021 Act.
Harsh Vardhan
Harsh reports on legislation, the law ministry and judicial appointments.
This report is for general information only and does not constitute legal advice. Readers should consult a qualified lawyer about their own circumstances. Case citations are to The Counsel Reports (TCR) unless otherwise stated.