Supreme Court: Judicial Background Compulsory for Tribunal Membership

Supreme Court on 11 May 2010 approved the Indian government’s decision to create the National Company Law Tribunal and the National Company Law Appellate Tribunal. A constitution bench including Chief Justice KG Balkrishnan and Justices RV Raveendran, D.K. Jain, P.Sathasivam and J.M. Panchal gave the judgment. The Bench was hearing appeals made by the Centre against a Madras High Court judgment holding valid its decision to transfer jurisdiction to the tribunal.

These tribunals will have the powers and jurisdiction equivalent of a high court in matters related to company law.

However, the bench made it clear that only judges and advocates would be appointed as judicial members of the tribunal. Although they did not question the Legislature’s right to shift jurisdiction from courts to tribunals they made it clear that any chairperson or member appointed within the tribunal should have judicial background instead of civil services background. The bench cited the reason that any civil servant having life long experience can be a capable administrator but won’t become a judicial officer with impartial attitude because he would owe his allegiance to the ministry he would be working for. Also he would lack specialization in judicial affairs. Besides filling the tribunal with civil servants would be a violation of the doctrine that there should be a separation of powers between judiciary and executives.