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Two more petitions have been filed in the Supreme Court challenging provisions of Finance Act, 2017 relating to Tribunals.
While one petition has been filed by All India Lawyers Union challenging Sections 182-185 of the Act, the second petition filed by Revenue Bar Association has challenged the Act in its entirety. Both the petitions have also assailed the Tribunal, Appellate Tribunal and other Authorities (Qualifications, Experience and other Conditions of Service of Members) Rules, 2017.
A Bench of Chief Justice Dipak Misra and Justices AM Khanwilkar and DY Chandrachud issued notice in the two cases. Senior Advocate PV Surendra Nath appeared for All India Lawyers Union.
In a petition filed by advocate Reshmita R Chandran, the All India Lawyers Union, has challenged Sections 182 to 185 of the Act alleging that it is an attempt by the Union government “to interfere with the independence of the tribunals”.
“Sections 182, 183, 184 and 185 of the Finance Act, 2017 and the Rules framed under Section 184…are in clear violation of the dictum laid by this Hon’ble court in R Gandhi v. Union of India….that the independence of the judiciary stood to suffer if the qualifications for appointment as members are diluted in haste.”
It is the petitioner’s contention that the provisions will lead to tribunals being headed by persons from non-legal background and training.
“If civil servants become Chairpersons of Tribunals, they may become impartial adjudicators because training and ability to write reasoned judgments are key attributes of such objectivity…increasing bureaucratic control over the selection of members of the Tribunals has destructive aftereffects not only for the independent discharge of these bodies but for the effective discharge of the duties for which they were created”
Lawyers Union has also contended that the passage of the Act as a Money Bill is a colourable exercise of power and amounts to a fraud on the Constitution.
The petitioner Union has further submitted that the Rules fall foul of the Supreme Court judgment in Madras Bar Association v. Union of India and clearly violates independence of judiciary.
The petitioner Union has prayed for striking down Sections 182 to 185 and the Rules.
The petition by Revenue Bar Association has challenged the Finance Act, particularly PART XIV of the Act.
The petition drawn by advocates Nikhil Nayyar, N Sai Vinod and Rahul Unnikrishnan and settled by Senior Advocate Arvind Datar decries the passage of Finance Act as a Money Bill. It states,
“…it is submitted that the passage of the Finance Act in the form of a ‘Money Bill’ is entirely inappropriate and derogates substantive provisions of the Constitution. PART XIV deals with appointment, selection, eligibility and other service conditions of Members of Scheduled Tribunals, which is primarily concerned with administration of justice, jurisdiction and powers of courts and access to justice. Whilst Article 110 does not per se bar the inclusion of nonfiscal proposals in a Finance Bill, such a proposal must (i) be an ‘incidental’ ancillary provision (ii) to enable the State in creating or obviating fiscal charge or regulating fiscal activities such as borrowings, withdrawal or such other financial obligations.
Mere incidental burden on the Consolidated Fund is insufficient to qualify proposed legislation as a ‘Money Bill’. In the instant case, the provisions affecting administration of tribunals can hardly qualify as a pure fiscal measure, or enacted purely on financial considerations. As a consequence, the approval of the Rajya Sabha on ordinary legislative subjects stipulated under Articles 107 and 108 has been brought to a naught. Such colourable exercise of powers to bypass the Upper House, is impressible and amounts to fraud on the Constitution.”
Regarding the provisions impinging upon the independence of judiciary, the petition states,
“…the Finance Act completely undermines the stature, efficacy and judicial independence of the Scheduled Tribunals. Section 184 has delegated the powers to prescribe service conditions (such eligibility, tenure, appointment process etc.,) to the Central Government. Whereas, each of the said service conditions were expressly codified under the parent statute of the Tribunals.
The delegation of critical aspects affecting independence of Tribunals is per se arbitrary and an affront to basic features of the Constitution (i.e., independence of judiciary and separation of powers).”
Regarding the provisions relating to appointment and service conditions of the members of various tribunals, the petitioner has placed reliance on the cases of R Gandhi v. Union of India to submit that,
“Impugned Rules relating to the appointment of the Members are in violation of binding guidelines laid down by this Hon’ble Court, wherein the only members with the status and experience equivalent to the Judges of the High Courts can only be considered. On the other hand, the Impugned Rules have permitted Specialist/Technical Member to be appointed as the Chairperson or President of a Tribunal”.
The petitioner has prayed for striking down Finance Act, 2017 as null and void for violation of Articles 107, 110 and 117 of the Constitution of India. The petitioner has also prayed for declaring PART XIV of Finance Act, 2017 as ultra vires the Articles 14, 21, 50 and 323B of the Constitution.
Read the petition of Revenue Bar Association below.