Tribunals vs Judicial Power Constitutional Issues After Recent Amendments

Abstract

The Indian Constitution, under its basic structure, establishes a clear separation of powers among the Legislature, the Executive, and the Judiciary. A critical component of this framework is the independence of the judiciary, which is the bedrock of democracy and the guardian of fundamental rights. However, the last few decades have witnessed a significant rise in the delegation of judicial functions to specialized tribunals. Established to provide expedient, expert, and cost-effective justice in complex domains such as taxation, company law, administrative service matters, and environmental disputes, tribunals were envisioned as supplements to the traditional judiciary. Recent constitutional and legislative amendments, particularly those embedded in the Finance Acts of 2017 and beyond, have profoundly altered the architecture of the tribunal system in India. This article undertakes a critical examination of the escalating tension between the proliferation of tribunals and the preservation of core judicial power. It argues that the recent amendments, which centralize control over tribunals within the executive branch, pose a grave threat to judicial independence, thereby violating the Constitution's basic structure. The analysis traces the historical and jurisprudential evolution of tribunals in India, scrutinizes the specific contentious amendments, and evaluates the Supreme Court's response through landmark judgments. The article concludes that while tribunals are an indispensable part of a modern justice delivery system, their design and administration must be insulated from executive influence to uphold the constitutional mandate of an independent judiciary and the rule of law.

Introduction

The Indian Constitution is not merely a legal document; it is a social contract that establishes a sovereign, socialist, secular, democratic republic. Central to this democratic edifice is the doctrine of separation of powers, a principle that, while not explicitly mentioned in the text, is unequivocally enshrined in its basic structure as propounded by the Supreme Court in the landmark case of Kesavananda Bharati v. State of Kerala (1973). This doctrine mandates a delicate balance between the three organs of the State—the Legislature, the Executive, and the Judiciary—to prevent the concentration of power and protect the liberty of the citizen.

The judiciary, as the final interpreter of the Constitution and the ultimate arbiter of disputes, holds the power of judicial review. This power is its most potent weapon to check legislative and executive excesses and to protect the fundamental rights of individuals. Any attempt to dilute this power strikes at the very heart of constitutional democracy. The independence of the judiciary, secured through secure tenure, fixed salaries, and rigorous appointment processes (the Collegium system), is the cornerstone that enables it to perform this sacred duty without fear or favour.

In the latter half of the 20th century, as the State's role expanded into complex regulatory fields, the traditional court system began to show signs of strain. Overburdened dockets, procedural delays, and a lack of specialized knowledge in technical areas led to a search for alternative dispute resolution mechanisms. This gave rise to the tribunalisation of justice—the creation of quasi-judicial bodies outside the traditional court hierarchy. These tribunals, such as the Income Tax Appellate Tribunal (ITAT), the Central Administrative Tribunal (CAT), and the National Green Tribunal (NGT), were established with the laudable objectives of providing speedy, accessible, and expert justice.

For decades, a functional equilibrium existed. The judiciary, through a series of judgments, validated the creation of tribunals but laid down stringent safeguards to ensure they did not compromise judicial independence. However, this equilibrium has been dramatically disrupted by a wave of recent amendments, most notably those effected through the Finance Acts of 2017. These amendments have fundamentally reconfigured the governance, appointment, and service conditions of tribunals, consolidating unprecedented control in the hands of the executive. This has ignited a fierce constitutional debate, raising alarming questions about the executive's encroachment upon the domain of the judiciary and the potential subversion of the basic structure doctrine.

This article delves into this critical constitutional conundrum. It seeks to analyze whether the recent trajectory of tribunal reforms represents a legitimate effort to streamline justice delivery or a clandestine assault on judicial power. The analysis proceeds in four parts: First, it explores the constitutional genesis and historical justification for tribunals. Second, it provides a detailed examination of the recent amendments and the specific constitutional issues they raise. Third, it critically evaluates the Supreme Court's judicial response to these challenges. Finally, the article concludes by reflecting on the future of tribunals in India and the imperative of reclaiming their independence to preserve the constitutional balance of power.

Part I: The Constitutional Genesis and Evolution of Tribunals in India

The journey of tribunals in India is a story of pragmatic adaptation intersecting with constitutional principles.

1.1. The Constitutional Text: Articles 323A and 323B

The original Constitution of 1950 did not contain explicit provisions for tribunals. Their legal foundation was primarily statutory. However, recognizing the growing need for specialized adjudicatory bodies, the Constitution was amended in 1976 by the 42nd Amendment Act, which introduced two new articles:

» Article 323A: Empowers Parliament to establish tribunals for the adjudication of disputes concerning recruitment and conditions of service of persons appointed to public services. This led to the creation of the Central Administrative Tribunal (CAT) and State Administrative Tribunals.

» Article 323B: Empowers Parliament and State Legislatures to establish tribunals for a wider range of subjects, including taxation, foreign exchange, industrial and labour disputes, land reforms, and elections.

These provisions provided a explicit constitutional sanction for the tribunalisation of justice, moving it from a purely legislative policy to a constitutionally envisaged mechanism.

1.2. The Judicial Justification and Early Safeguards

The Supreme Court, while acknowledging the utility of tribunals, has consistently acted as a sentinel on the qui vive, guarding against any dilution of judicial power. The early challenges to tribunals were primarily based on the argument that they violated the separation of powers and usurped the jurisdiction of the regular courts.

The watershed moment came with the case of S.P. Sampath Kumar v. Union of India (1987). Upholding the validity of the Administrative Tribunals Act, 1985, the Court held that the power of judicial review vested in the High Courts under Articles 226 and 227 is part of the basic structure and cannot be entirely taken away. However, this power can be transferred to an alternative institutional mechanism, provided it is equally efficacious and independent. The Court emphasized that for a tribunal to be a "substitute" for a High Court, it must possess:

• A Chairperson who is or has been a Judge of the Supreme Court or a High Court.

• Judicial members of a stature and competence comparable to High Court Judges.

The same independence from the executive, including in matters of appointment and service conditions.

This principle was further solidified in L. Chandra Kumar v. Union of India (1997), a judgment of monumental importance. A seven-judge Constitution Bench unequivocally declared that the power of judicial review vested in the High Courts and the Supreme Court under Articles 226/227 and 32 respectively is an "inviolable" part of the basic structure. Consequently, it struck down clauses in Articles 323A and 323B that excluded the jurisdiction of High Courts. The Court established a hierarchical structure: Tribunals would be the courts of first instance, but their orders would be subject to scrutiny before a Division Bench of the respective High Court. This judgment established a clear constitutional protocol: tribunals are supplemental, not superior, to the constitutional courts, and are ultimately subject to their supervisory jurisdiction.

Part II: The Contours of the Crisis: An Analysis of Recent Amendments

The relative stability established by L. Chandra Kumar was severely jolted by a series of legislative changes, predominantly through money bills, which circumvented rigorous parliamentary scrutiny in the Rajya Sabha.

2.1. The Finance Act, 2017: A Paradigm Shift

The Finance Act, 2017, served as a legislative vehicle to effect sweeping changes to the tribunal ecosystem. Instead of amending individual tribunal acts, it introduced a new framework by amending the Finance Act, 2016, to create a set of "Rules" that would govern multiple tribunals.

The key changes introduced were:

» Streamlining and Abolition: It sought to merge several tribunals and abolish others. For instance, it proposed the merger of the Competition Appellate Tribunal (COMPAT) with the National Company Law Appellate Tribunal (NCLAT). The stated objective was to eliminate redundancy and reduce litigation costs. However, critics argued that this was a move to reduce the number of independent forums for challenging executive action.

» Centralization of Appointment Power: The Act replaced the separate, often judicially-dominated, selection committees for various tribunals with a uniform structure. It established a "Search-cum-Selection Committee" for each tribunal, chaired by the Chief Justice of India or a Supreme Court Judge nominated by him. However, crucially, the Committee included:

Two Secretaries from the Government of India.

The outgoing Chairperson or a retired Chairperson/Judge from the tribunal.

This 3:2 composition, with the government having a significant presence, tilted the balance of power. Furthermore, the Central Government was given the power to finalize the appointments based on the Committee's recommendations, raising concerns about the executive having the final say.

Executive Control over Service Conditions: The Act delegated the power to prescribe the tenure, salaries, allowances, and other service conditions of tribunal members to the Central Government, to be notified by rules. This was a radical departure from the past, where these conditions were often statutorily defined to mirror those of High Court judges or other constitutional posts, ensuring parity and independence. Placing this power in the hands of the executive created a scenario where the government could potentially use terms of service as a tool to influence tribunal members.

2.2. The Tribunal Reforms Act, 2021 and the Ordinance of 2021

The provisions of the Finance Act, 2017, were challenged before the Supreme Court. In Rojer Mathew v. South Indian Bank Ltd. (2019), a five-judge Constitution Bench struck down the Tribunal Rules framed under the 2017 Act, citing violations of the principles of independence, separation of powers, and the rule of law. The Court directed the government to reformulate the rules in accordance with its guidelines.

In response, the government promulgated the Tribunal Reforms Ordinance, 2021, which was later enacted as the Tribunal Reforms Act, 2021. Astonishingly, this new legislation re-introduced several provisions that the Supreme Court had explicitly struck down or criticized in Rojer Mathew and another subsequent case, Madras Bar Association v. Union of India (2021).

The contentious provisions included:

» A Four-Year Tenure: Prescribing a short, four-year term for tribunal members, which the Court had held was detrimental to independence.

» Minimum Age Criteria: Setting a minimum age of 50 years for appointment, which the Court found arbitrary as it excluded many well-qualified younger candidates.

» Re-employment Restrictions: Barring advocates from tribunal appointments if they had attained the age of 50, a provision the Court found irrational.

» Executive-Led Appointments: Reiterating the search-cum-selection committee structure with significant executive presence.

This legislative action of re-enacting provisions declared unconstitutional by the Supreme Court represented a direct and unprecedented confrontation between the legislature and the judiciary.

Part III: The Core Constitutional Issues at Stake

The recent amendments have raised several fundamental constitutional issues that strike at the core of India's democratic fabric.

3.1. Violation of the Basic Structure Doctrine

The most serious allegation is that the amendments violate the basic structure of the Constitution.

» Judicial Independence: The centralization of control over appointments, tenure, and service conditions in the executive branch directly impinges upon the independence of tribunals. If the executive becomes the master of the adjudicator's appointment and remuneration, the adjudicator's ability to rule against the executive in a dispute is severely compromised. This creates a "Sword of Damocles" hanging over the heads of tribunal members.

» Separation of Powers: By granting the executive dominant control over a key wing of the justice delivery system, the amendments blur the line between the adjudicatory and executive functions. Tribunals, which perform a quintessentially judicial function, are being brought under the thumb of the very branch they are often required to adjudicate upon. This is a fundamental subversion of the separation of powers.

3.2. The Erosion of Judicial Review

While L. Chandra Kumar preserved the power of High Courts to review tribunal decisions, a weakened and executive-dependent tribunal at the first instance can effectively nullify the purpose of judicial review. If the initial adjudication itself is suspect or biased, the appellate process becomes a mere formality and places an unsustainable burden on the High Courts. The right to an effective remedy, a facet of Article 21 (Right to Life and Personal Liberty), is thus diluted.

3.3. The "Money Bill" Controversy

A significant procedural issue is the use of the Money Bill route to enact these sweeping tribunal reforms. A Money Bill, as defined under Article 110 of the Constitution, deals primarily with taxation, government borrowing, and expenditure. Its key feature is that it does not require the assent of the Rajya Sabha, the upper house of Parliament. By embedding tribunal reforms within the Finance Act, the government effectively bypassed the scrutiny and potential opposition of the Rajya Sabha. This was famously challenged in the case concerning the Aadhaar Act, and the use of a similar tactic for tribunal reforms has been widely criticized as a subversion of the bicameral legislative process for non-financial, structural constitutional changes.

3.4. The Crisis of Institutional Credibility

When tribunals are perceived as being under the influence of the executive, their legitimacy and public trust erode. Litigants may lose faith in the fairness of the process, viewing tribunals not as impartial arbiters but as extended arms of the government. This crisis of credibility is detrimental to the rule of law and can push citizens towards extra-legal means of resolving disputes.

Part IV: The Supreme Court's Response: A Struggle for Supremacy

The Supreme Court has been engaged in a protracted battle to uphold constitutional principles against these legislative incursions.

4.1. Rojer Mathew v. South Indian Bank Ltd. (2019)

As mentioned, this five-judge Bench struck down the Tribunal Rules, 2017. The Court held that the Rules undermined the independence of the judiciary and the separation of powers. It emphasized that the power to frame rules governing tribunals lies within the domain of the judiciary, as per Article 247 read with Entries 11A and 12 of the Concurrent List, and cannot be usurped by the executive through a Money Bill.

4.2. Madras Bar Association v. Union of India (2020, 2021)

This has been the most significant series of cases challenging the various tribunal reforms. In its 2020 judgment, the Court struck down several parts of the Tribunal Rules. In its 2021 judgment, it dealt with the Tribunal Reforms Act, 2021. The Court, displaying a mix of judicial firmness and pragmatism, struck down the specific provisions related to the four-year term, the minimum age of 50, and the ban on advocates above 50, reiterating that these were detrimental to tribunal independence. However, it stopped short of striking down the entire Act. The Court gave the government time to reform the system, continuing the dialogue but making its constitutional expectations clear.

4.3. The Inherent Tension and Judicial Deference

The Court's response, while principled, also reveals a tension. On one hand, it is duty-bound to strike down unconstitutional laws. On the other, it must avoid a direct institutional collision with a democratically elected parliament. This has led to a pattern where the Court strikes down specific provisions but allows the overall legislative framework to stand, often giving the government repeated opportunities to rectify the defects. Critics argue that this has allowed the executive to persist with its agenda through repeated legislation and ordinances, testing the limits of judicial patience.

Conclusion: Reclaiming the Constitutional Balance

The saga of tribunals in India is a microcosm of the larger struggle to define the boundaries of power in a vibrant democracy. There is no denying that tribunals, as specialized bodies, are an essential and permanent feature of the Indian legal landscape. Their utility in decongesting courts and providing expert justice is undeniable. However, efficiency cannot be achieved at the cost of constitutional integrity.

The recent amendments, culminating in the Tribunal Reforms Act, 2021, represent a systematic effort to bring the tribunal system under executive hegemony. This is not a mere administrative reform; it is a constitutional transgression that undermines the basic structure doctrine, particularly judicial independence and the separation of powers. The use of Money Bills to effect these changes adds a layer of procedural impropriety to the substantive constitutional violation.

The Supreme Court, through its jurisprudence from Sampath Kumar to L. Chandra Kumar and the recent Madras Bar Association cases, has laid down a clear roadmap: Tribunals are welcome, but only if they are as independent, impartial, and efficacious as the courts they seek to supplement. The government's insistence on controlling appointments and service conditions is antithetical to this principle.

The way forward requires a return to first principles. A new legislative framework, drafted in consultation with the judiciary and legal experts, must be enacted. This framework must ensure:

A transparent, judiciary-dominated appointment process for tribunal members, perhaps under a unified National Tribunal Commission.

Secure tenure and service conditions for members that are statutorily guaranteed and not left to the whims of the executive.

Functional and financial autonomy for tribunals.

A clear adherence to the bicameral legislative process for any future reforms.

The independence of the judiciary is not a privilege for judges; it is a right of every citizen to a fair and impartial trial. Tribunals, as dispensers of justice, must be insulated from the very power they are meant to judge. To allow otherwise would be to silently acquiesce to the erosion of a fundamental pillar of Indian democracy. The recent constitutional crisis surrounding tribunals is a clarion call for all stakeholders—the legislature, the executive, the judiciary, and the citizenry—to reaffirm their commitment to a Constitution that is intended to endure for ages to come.

Here are some questions and answers on the topic:

1. What was the original constitutional justification for creating tribunals in India, and how did the judiciary initially seek to balance their growth with the protection of judicial power?

The original constitutional justification for tribunals emerged from the practical need to address the limitations of the traditional court system, which was becoming overburdened, procedurally slow, and lacked specialized expertise in complex technical areas like taxation, service matters, and environmental law. This need was formally constitutionalized through the 42nd Amendment Act of 1976, which introduced Articles 323A and 323B, explicitly empowering Parliament and State Legislatures to establish tribunals for adjudicating disputes in specific fields. The initial intent was not to supplant the judiciary but to create a supplementary, expert, and efficient forum for justice delivery. The judiciary, recognizing this utility, played a crucial role in balancing this growth with the protection of its core power. In landmark judgments like S.P. Sampath Kumar v. Union of India (1987), the Supreme Court upheld the validity of tribunals but laid down the critical condition that for a tribunal to be a valid substitute for a High Court, it must be equally independent and efficacious, possessing a judicial character and members of a stature comparable to High Court judges. This balancing act was perfected in L. Chandra Kumar v. Union of India (1997), where the Court unequivocally declared that the power of judicial review vested in the High Courts and Supreme Court under Articles 226/227 and 32 is an inviolable part of the Constitution's basic structure. Therefore, while tribunals could act as courts of first instance, their decisions would remain subject to the supervisory jurisdiction of the High Courts, thereby preserving the ultimate authority and independence of the constitutional judiciary.

2. How have recent amendments, particularly the Finance Act of 2017, fundamentally altered the relationship between tribunals and the executive branch, and why does this raise constitutional concerns?

Recent amendments, with the Finance Act of 2017 being the most pivotal, have fundamentally altered the relationship by systematically transferring control over the key aspects of tribunal functioning from the judiciary to the executive branch. This Act, along with subsequent legislation like the Tribunal Reforms Act of 2021, centralized the governance of various tribunals by introducing a uniform set of rules controlled by the government. The most significant alterations were in the domains of appointments and service conditions. The amendments reconstituted the Search-cum-Selection Committees to include a significant presence of government secretaries, thereby diluting the primacy of the judiciary in the appointment process. Furthermore, the power to determine critical service conditions such as tenure, salaries, and allowances was delegated to the central government. This raises profound constitutional concerns because it directly undermines the principle of judicial independence, which is a cornerstone of the basic structure doctrine. When the executive, which is often the largest litigant before these tribunals, gains control over the appointment, tenure, and remuneration of tribunal members, it creates a pervasive conflict of interest and a potential for undue influence. This erodes the tribunals' impartiality and their ability to act as a check on executive power, effectively blurring the separation of powers and transforming a judicial forum into a potentially controlled entity, which is antithetical to the rule of law.

3. The Supreme Court in the L. Chandra Kumar case declared the power of judicial review a basic feature of the Constitution. How do the recent tribunal reforms threaten this principle, even though the formal right to appeal to High Courts remains?

The threat posed by recent tribunal reforms to the principle of judicial review established in L. Chandra Kumar is not about formally removing the right to appeal but about rendering that right less meaningful and effective. The core promise of L. Chandra Kumar was that tribunals would serve as effective, independent, and specialized substitutes for the High Courts at the first instance, with the High Courts retaining their supervisory power. The recent reforms threaten this by potentially compromising the quality and independence of the initial adjudication itself. If tribunal members are appointed through an executive-dominated process and serve under short tenures with government-determined salaries, their independence is inherently suspect. A litigant may receive a biased or poorly reasoned order from a tribunal that is perceived to be under executive influence. While they can technically appeal this order to a High Court, the appellate process then becomes a de novo hearing, placing an immense burden on the High Court to re-examine facts and evidence. This defeats the very purpose of creating expert tribunals for efficient justice and clogs the constitutional courts with appeals that should have been decided correctly in the first place. Thus, by weakening the tribunal at the root, the reforms dilute the efficacy of the entire judicial hierarchy and make the constitutional right to judicial review a more cumbersome and less accessible remedy for the common citizen.

4. What is the significance of the "Money Bill" route in enacting these tribunal reforms, and why has it been a major point of constitutional controversy?

The significance of using the "Money Bill" route, as done with the Finance Act of 2017, lies in its strategic bypassing of the Rajya Sabha, the Upper House of Parliament. According to Article 110 of the Constitution, a Money Bill is primarily concerned with matters of taxation, government expenditure, and borrowing, and its defining feature is that it can be passed by the Lok Sabha alone and does not require the approval of the Rajya Sabha. By embedding sweeping structural reforms to the tribunal system within a Finance Bill, the government effectively enacted significant changes to the justice delivery system without the scrutiny, debate, and potential opposition that would have occurred in the Rajya Sabha. This has been a major point of constitutional controversy because it is seen as a subversion of the bicameral legislative process for matters that are not fundamentally financial in nature. Critics argue that the character of the tribunal reforms— dealing with appointments, tenure, and the organization of quasi-judicial bodies— is purely related to the administration of justice and falls outside the legitimate scope of a Money Bill. This tactic, therefore, raises serious questions about procedural propriety and represents a backdoor method to implement contentious legal changes, undermining the checks and balances inherent in India's parliamentary system.

5. Analyze the Supreme Court's response to the repeated legislative attempts to control tribunals, as seen in cases like Rojer Mathew and Madras Bar Association. Has the Court been effective in upholding constitutional principles?

The Supreme Court's response to the repeated legislative attempts to control tribunals, as evidenced in Rojer Mathew v. South Indian Bank (2019) and the series of Madras Bar Association v. Union of India judgments, has been principled in its legal stance but has revealed a strategic struggle in enforcing its will against a persistent executive. In substance, the Court has been unwavering in upholding constitutional principles. In Rojer Mathew, a Constitution Bench struck down the Tribunal Rules framed under the Finance Act, 2017, for violating the principles of judicial independence and separation of powers. Similarly, in Madras Bar Association (2021), the Court struck down specific provisions of the Tribunal Reforms Act, 2021—such as the four-year tenure and minimum age criteria—that it had explicitly disapproved of in earlier judgments. The Court correctly identified these as detrimental to tribunal independence. However, the government's response of re-enacting nearly identical provisions through new legislation has created a cycle of confrontation that tests the Court's effectiveness. While the Court has used its power of judicial review to invalidate unconstitutional provisions, it has often stopped short of striking down the entire legislative framework, opting instead to provide the government with opportunities to rectify the laws. This judicial deference, aimed at avoiding a direct institutional clash, has arguably been exploited by the executive, leading to a protracted battle. Therefore, while the Court has been entirely effective in articulating and reaffirming constitutional principles, its ultimate effectiveness in compelling compliance remains an ongoing challenge, highlighting the limits of judicial power in the face of determined legislative majoritarianism.

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