Tribunals Reforms Ordinance 2021: An Overview

The Tribunals Reforms Ordinance 2021 was introduced by the government with an aim to dissolve certain existing tribunals and transfer their functions to the existing judicial bodies.

The ordinance aims to amend the Finance Act 2017 and include provisions related to the composition of search-cum-selection committees and the term of office of members for 19 tribunals (such as Customs, Excise, and Service Tax Appellate Tribunal) in the Act itself.

The following is a list of the appellate bodies that the Tribunals Reform Ordinance 2021 proposes to dissolve, along with the proposed entities to which the functions of these tribunals will be transferred:

Key Provisions of the Tribunals Reform Ordinance 2021:

• What is a search-cum-selection committee?

This committee is responsible for recommending the names of the chairpersons and the members for appointment by the central government in the Tribunal. The composition of the committee as per the Tribunals Ordinance 2021 is:

1. Chairperson – The Chief Justice of India, or a Supreme Court Judge nominated by him. He/She has the casting vote
2. Two secretaries – Nominated by the Central Government
3. The sitting or outgoing Chairperson, or a retired Supreme Court Judge, or a retired Chief Justice of a High Court
4. The Secretary of the Ministry under which the Tribunal is constituted. He/She has no voting right.

• Term of Office for the Tribunals Members

The Tribunals Reform Ordinance outlines the following term of office:

1. Chairperson – 4 years or until the age of 70 years [Whichever is earlier]
2. Remaining Members- 4 years or until they reach the age of 67 years [Whichever is earlier]

• National Consumer Disputes Redressal Commission (NCDRC)

The ordinance proposes to include the NCDRC within the purview of the Finance Act 2017. The NCDRC has been established under the Consumer Protection Act, 2019.

• Removal of the tribunals as discussed at the beginning of the article.

The Tribunal Reforms Act, 2021 was passed by the Parliament in August 2021. Click on the link to know more about the Act.

An Introduction to Tribunals

Tribunals were not originally a part of the Indian Constitution . They were introduced in 1985.

1. The primary objective of establishing tribunals was to ensure quick, affordable and decentralised resolution of disputes in various matters.
2. Tribunals were created to bypass the route of regular courts for dispensing disputes.
3. Some tribunals function as specialised government agencies or boards and are endowed with decision-making powers by law.
4. The provision for tribunals was not originally present in the Constitution.
   • The 42nd Amendment Act introduced these provisions following the recommendations of the Swaran Singh Committee .
   • The Amendment introduced Part XIV-A to the Constitution.
   • This Part is titled ‘Tribunals’ and contains two articles.
     • Article 323A: Administrative Tribunals. Administrative tribunals are quasi-judicial institutions that resolve disputes related to the recruitment and service conditions of persons engaged in public service. Article 323A provides for this and the Central Administrative Tribunal was created under this Section.
     • Article 323B: Tribunals for other subjects such as:
       • Taxation
       • Industrial and labour
       • Foreign exchange, import and export
       • Land reforms
       • Food
       • The ceiling on urban property
       • Elections to Parliament and state legislatures
       • Rent and tenancy rights
     • While 323A deals with administrative tribunals, 323B deals with other types of tribunals (like National Green Tribunal, Competition Appellate Tribunal (COMPAT), Securities Appellate Tribunal (SAT), etc.
     • Tribunals under 323A can be established only by the Parliament. However, tribunals under 323B can be established by both the Parliament and the State Legislature.
     • Under 323A, there can be only one tribunal at the centre and one for each state (or two or more states), but under 323B, there can be a hierarchy of tribunals.

Administrative Tribunals: A Closer Look

Here are some key characteristics of administrative tribunals:

1. They are created by a statute by Parliament/Legislatures, thus they have a statutory origin.
2. They are quasi-judicial in nature, implying that they possess some, but not all, characteristics of a court.
3. They function on the principles of natural justice and are not bound by the Civil Procedure Code.
4. They have the power to summon witnesses, administer oaths and compel the submission of documents, similar to other courts.
5. The writs of prohibition and certiorari can be issued against decisions of such tribunals.
6. They are independent bodies and are not subject to administrative interference.

Read about the constitutional, statutory and quasi-judicial bodies in the linked article.

Advantages of Administrative Tribunals

1. Tribunals offer flexibility compared to ordinary courts that have to adhere to strict procedures.
2. They are more affordable and offer quicker justice.
3. The procedure followed by the tribunals is simple and easy to understand even for the layman.
4. They also offer relief to the ordinary courts that are already over-burdened with suits.

Disadvantages of Administrative Tribunals

1. They can potentially go against the spirit of the “Rule of Law”.
   • Rule of Law ensures that arbitrary power is not exercised by institutions or individuals.
   • It is the principle that everybody is subject to and accountable to the law (which is fair).
2. Ordinary courts follow a uniform code of procedure for civil and criminal cases. However, administrative tribunals do not have a uniform code of procedure.
3. Such tribunals are sometimes handled by subject matter experts who have no experience in dealing with judicial proceedings. Hence, they may end up adopting summary procedures as well.

Challenges Faced by Administrative Tribunals

Despite being established to deliver quick and efficient justice to people, there are some challenges in the functioning of tribunals.

• There is a lack of autonomy in the appointment and funding of tribunals.
• In the Chandra Kumar case (1997), the Supreme Court held that appeals against the orders of a tribunal could be made in the High Court. This undermines the purpose of reducing the burden of the regular courts.
• Currently, there is a lack of infrastructure for the tribunals to function efficiently.
• Generally, the government appoints retired judges as chairpersons to tribunals. This could potentially lead to current judges showing favouritism in anticipation of a post-retirement appointment.
• The autonomy of the tribunals should be maintained and there is a need for structural and functional reforms of tribunals so that they are removed from the influence of the executive.
• There should be some form of judicial control over tribunals to maintain the Rule of Law.

Other Noteworthy Tribunals

Below are brief descriptions of a few other tribunals.

Armed Forces Tribunal

• This is a military tribunal established under the Armed Forces Tribunal Act, 2007.
• It settles disputes related to the commission, emoluments, appointments and service conditions of personnel in the armed forces.
• Its Principal Bench is in New Delhi and there are ten Regional Benches.

Download the notes on Armed Forces Tribunal (AFT) for UPSC preparation, from the linked article.

National Green Tribunal

• It was established in 2010 for effective and expeditious disposal of cases related to the protection and conservation of the environment, forests and other natural resources.
• Read more on the National Green Tribunal (NGT) in the linked article.

Water Disputes Tribunal

• These are constituted to settle disputes between Indian states over the sharing of water from rivers that flow through multiple states.
• For more information on the Inter-State river water disputes tribunal , check the linked article.

Income Tax Appellate Tribunal (ITAT)

• Established in 1941, the ITAT deals with appeals under the direct taxes acts.
• The orders passed by this tribunal are final, and an appeal lies to the High Court only if a substantial question of law arises for determination.
• Currently, the tribunal has 63 Benches.

Understanding the Difference between Tribunal and Court

Both tribunals and courts are involved in settling disputes between parties that affect their rights. However, there are key differences between the two. The following table summarises these differences.

Tribunals in India – Indian Polity:- Download PDF Here