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MEMBERS' REFERENCE

SERVICE LARRDIS

LOK SABHA SECRETARIAT

NEW DELHI

LE GISLATIVE NOTE For the use of Members of Parliament NOT FOR PUBLICATION

No. 24/LN/Ref./March/2021

THE TRIBUNALS REFORMS (RATIONALISATION AND CONDITIONS

OF SERVICE) BILL, 2021

Prepared by Smt. Nisha, Research Officer (23035037) of Lok Sabha Secretariat and Shri Thomas Nghaite, Additional Director under the supervision of Shri Pradosh Panda, Director and Smt. Kalpana Sharma, Additional Secretary (23034845). The Legislative Note is for personal use of the Members in the discharge of their Parliamentary duties, and is

not for publication. This Service is not to be quoted as the source of information as it is based on the sources

indicated at the end/in the context.

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The Tribunals Reforms (Rationalisation and Conditions of Service) Bill, 2021

Objectives

The Tribunals Reforms (Rationalisation and Conditions of Service) Bill, 2021, was

introduced in Lok Sabha on 13 February, 2021. The Bill proposes to abolish

certain tribunals and authorities and to provide a mechanism for filing appeal

directly to the commercial court or the High Court, as the case may be. These

tribunals are of the kind which handle cases in which public at large is not a

litigant or those which neither take away any significant workload from High

Courts which otherwise would have adjudicated such cases, nor provide speedy

disposal.

Need of the Bill

Following are the reasons behind need of the Bill:

1) Many cases do not achieve finality at the level of tribunals and are litigated

further till High Courts and Supreme Court, especially those with significant

implications. Therefore, these tribunals only add to another additional layer

of litigation.

2) Having separate tribunal requires administrative action in terms of filling up

of posts and such other matters, and any delay in such action further delays

disposal of cases.

3) Reducing the number of tribunals shall not only be beneficial for the public

at large, reduce the burden on public exchequer, but also address the issue of

shortage of supporting staff of tribunals and infrastructure.

Background

The Government of India began the process of rationalisation of tribunals in

2015. By the Finance Act, 2017, seven tribunals were abolished or merged based

on functional similarity and their total number was reduced from 26 to 19. The

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rationale followed in this phase was to close down tribunals which were not

necessary and merge tribunals with similar functions.

Analysis of data of the last three years has shown that tribunals in several

sectors have not necessarily led to faster justice delivery. They are also at a

considerable expense to the exchequer. The Hon'ble Supreme Court has

disapproved the practice of tribunalisation of justice and filing of appeals directly

from tribunals to the Supreme Court in its judgements like S.P Sampath Kumar

versus Union of India (1987) 1 SCC 124, L. Chandra Kumar versus Union of India

(1997) 3 SCC 261, Roger Mathew versus South Indian Bank Limited (2020) 6

SCC 1 and Madras Bar Association versus Union of India and another (2020) SCC

Online SC 962. Therefore, further streamlining of tribunals is considered necessary

as it would save considerable expense to the exchequer and at the same time, lead

to speedy delivery of justice. Accordingly, the Bill has proposed to abolish some

more tribunals and transfer the jurisdiction exercised by them to the High Court.

Salient features

The Tribunals Reforms (Rationalisation and Conditions of Service) Bill,

2021, inter-alia, seeks

(i) Abolition of tribunals or authorities under various Acts by amending

The Cinematograph Act, 1952 (Sections 2, 5C,5D,5DD,

6,7A,7C,7D,7E,7F)

The Copyrights Act, 1957 (Sections 2, 6,11,12, 19A, 23, 31, 31A, 31B,

31C, 31D, 32, 32A and 33A,50, 53A,54,72,74,75,77,78, Ch II)

The Customs Act, 1962 (Sections 28E,28EA,28F,28KA,28L, 28M)

The Patents Act, 1970(Section 2, 52,58,59,64,71,76,113,116,117A,117B,

117C,117D, 117E,117F, 117G, 117H,151,159,Ch XIX)

The Airport Authority of India Act, 1994(Sections 28A,

28E,28I,28J,28JA,28K,28L,28M,28N,33,41)

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The Trade Marks Act, 1999 (Sections 2, 10, 26, 46,47,57,71, 83, 84, 85,

86,87,88,89,89A,90,91,92,93,94,95,96,97,98,99,100,113,123,124,125,13

0,141,144,157, Ch XI)

The Geographical Indications of Goods (Registration and Protection)

Act, 1999 (Sections 2,19,23,27,31,32,33,34,35,36,48,57,58,63,72,75,87)

The Protection of Plant Varieties and Farmers' Rights Act, 2001

(Section 2, 44,54,55,56,57,58,59,89, Chapter VIII)

The Control of National Highways (Land and Traffic) Act, 2002

(Sections 2,5,14,15,16,17,18,19,40,41,50,ChII)

The Finance Act, 2017( Sections 184,186)

(ii) Transfer of all cases pending before such tribunals or authorities to the

Commercial Court or the High Court, as the case may be, on the appointed

date;

(iii) The Chairman and Members of such tribunals shall cease to hold office

and they shall be entitled to claim compensation not exceeding three months'

pay and allowances for the premature termination of term of their office or

of any contract of service.

ACTS Appellate Body To be substituted with

The Cinematograph

Act, 1952

Tribunal High Court (Section 5C)

The Copyrights

Act, 1957

Appellate Board

Commercial Court or the

Commercial Division of

High Court (Section 2(fa))

The Customs Act,

1962,

Appellate Authority

(Section 28KA)

High Court

The Patents Act,

1970

Appellate Board High Court

The Airport

Authority of India

Act, 1994

Tribunal

Section 28 E

Section 28K

Central Government

High Court

The Trade Marks

Act, 1999

Tribunal Registrar or the High Court

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The Geographical

Indications of

Goods (Registration

and Protection) Act,

1999

Tribunal

(Section 19)

Appellate Board

Registrar or the High Court

High Court

The Protection of

Plant Varieties and

Farmers' Rights

Act, 2001

Tribunal

High Court

The Control of

National Highways

(Land and Traffic)

Act, 2002

Tribunal

(to be inserted in

Section 2 after clause

(d)

Court that means the

principal Civil Court of

original jurisdiction in a

district, and includes the

High Court in exercise of its

ordinary original civil

jurisdiction

Proposals in the Bill

The Bill also proposes an amendment in Section 184 of the Finance Act,

2017 that pertains to Qualifications, appointment, etc. of Chairpersons and

Members of Tribunals. As per section 184(1) of the proposed Bill, The Central

Government may, by notification, make rules to provide for the qualifications,

appointment, salaries and allowances, resignation, removal and the other

conditions of service of the Chairperson and Members of the Tribunal as specified

in the Eighth Schedule:

Provided that a person who has not completed the age of fifty years shall not be

eligible for appointment as a Chairperson or Member:

Provided further that the allowances and benefits so payable shall be to the

extent as are admissible to a Central Government officer holding the post

carrying the same pay:

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Provided also that where the Chairperson or Member takes a house on rent,

he may be reimbursed a house rent subject to such limits and conditions as

may be provided by rules.

The Chairperson and Members of a Tribunal shall be appointed by the Central

Government on the recommendation of a Search-cum-Selection

Committee.(Section 184(2))

Search-cum –Selection Committee (Section 184(3))

The Search-cum-Selection Committee shall consist of—

1) the Chief Justice of India or a Judge of Supreme Court nominated by him—

Chairperson of the Committee;

2) two Secretaries nominated by the Government of India—Members;

3) one Member, who— (i) in case of appointment of a Chairperson of a

Tribunal, shall be the outgoing Chairperson of the Tribunal; or (ii) in case of

appointment of a Member of a Tribunal, shall be the sitting Chairperson of

the Tribunal; or (iii) in case of the Chairperson of the Tribunal seeking re-

appointment, shall be a retired Judge of the Supreme Court or a retired Chief

Justice of a High Court nominated by the Chief Justice of India: Provided

that, in the following cases, such Member shall always be a retired Judge of

the Supreme Court or a retired Chief Justice of a High Court nominated by

the Chief Justice of India, namely:- (i) Industrial Tribunal constituted by the

Central Government under the Industrial Disputes Act, 1947; (ii) Tribunals

and Appellate Tribunals constituted under the Recovery of Debts Due to

Banks and Financial Institutions Act, 1993; (iii) Tribunals where the

Chairperson or the outgoing Chairperson, as the case may be, of the Tribunal

is not a retired Judge of the Supreme Court or a retired Chief Justice or

Judge of a High Court; and (iv) such other Tribunals as may be notified by

the Central Government in consultation with the Chairperson of the Search-

cum-Selection Committee of that Tribunal; and

4) the Secretary to the Government of India in the Ministry or Department

under which the Tribunal is constituted or established—Member-Secretary

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Term of office of Tribunal Members (Section 184(11))

Notwithstanding anything contained in any judgment, order, or decree of any court

or any law for the time being in force,—

(i) the Chairperson of a Tribunal shall hold office for a term of four years or till he

attains the age of seventy years, whichever is earlier;

(ii) the Member of a Tribunal shall hold office for a term of four years or till he

attains the age of sixty-seven years, whichever is earlier

The proposed Bill also seeks to substitute “The National Consumer Disputes

Redressal Commission” (NCDRC), with “The Consumer Protection Act, 2019”.

(8th Schedule, Item 16)

Views in Press

1. “Govt plans major legal/patent law reforms; to shut 5 tribunals”

https://timesofindia.indiatimes.com/india/patents-cases-may-soon-go-to-courts-as-

govt-plans-to-dismantle-five-tribunals/articleshow/80916049.cms

2. Centre introduces bill in Lok Sabha to abolish five tribunals

https://www.indiatoday.in/india/story/centre-introduces-bill-in-lok-sabha-to-

abolish-five-tribunals-1769023-2021-02-14

3. A bill to abolish IP Appellate Tribunal. Is it a case of one step forward, two

steps backward!

https://www.lexology.com/library/detail.aspx?g=1d5dc9ae-88b6-40ca-a06e-

1e16a1970671

4. Government Introduces Bill to Reduce Tenure of Tribunal Members,

Rationalize Appointments

https://www.bloombergquint.com/law-and-policy/government-introduces-bill-to-

reduce-tenure-of-tribunal-members-rationalise-appointments

5. Centre introduces Bill in Lok Sabha to abolish five tribunals including Authority

for Advance Rulings

https://www.taxscan.in/centre-introduces-bill-in-lok-sabha-to-abolish-five-

tribunals-including-authority-for-advance-rulings-read-bill/101008/

6. Tribunals Reforms Bill proposes amendments to ten laws

http://lawtimesjournal.in/tribunals-reforms-bill-proposes-amendments-to-ten-laws/

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References

1. The Gazettee of India

2. Centre introduces bill in Lok Sabha to abolish five tribunals, India Today, Feb 14,2021

3. Govt introduces bill in LS to abolish 5 tribunals, Outlook, 13 February,2021

4. Govt plans major legal/patent law reforms; to shut 5 tribunals, Times of India,

15 February, 2021

5. Tribunals Reforms Bill proposes amendments to ten laws, lawtimesjournal.in,

19 February, 2021

6. Government Introduces Bill To Reduce Tenure Of Tribunal Members,

Rationalise Appointments, www.bloombergquint.com, 17 February 2021

7. Tribunals Reforms Bill proposes amendments to ten laws; seeks to replace

appellate authorities with High Courts, barandbench.com, 19 February,2021

8. Proposal to abolish Intellectual Property Appellate Board (IPAB): Tribunal

Reforms Bill 2021, lexology.com, 21 February 2021

9. New bill proposes the abolition of India's troubled IPAB, worldipreview.com, 16

February 2021