Notice Issued By Delhi High Court in Petition Concerning Appointment of NCLAT Technical Members

Team SoOLEGAL 22 Feb 2020 6:05pm

Notice Issued By Delhi High Court  in Petition Concerning Appointment of NCLAT Technical Members

The Delhi High Court issued notice to the National Company Law Appellate Tribunal (NCLAT) in a petition concerning the appointment of Technical Members. (India Awake for Transparency vs Ministry of Corporate Affairs W.P.(C) 10589/2017)

A Division Bench of Chief Justice DN Patel and Justice C Hari Shankar issued a notice to the Central Government in the petition preferred by India Awake for Transparency.

In this petition, one of the newly appointed Members (Technical) is sought to explain on what authority the office was being held.

The petitioner claims that challenges to the legality of appointing persons without any judicial exposure or grounding in law was decided by the Supreme Court after the establishment of the National Company Law Tribunal and its Appellate Tribunal under the Companies Act, 2013.

The petitioner states that the Supreme Court upheld the power to appoint such persons on the basis that the tribunals were specialized bodies which needed technical members ' expertise.

Subsequently the Court struck down the initial Section 411(3) of the Companies Act, 2013. The provision had defined 25 years of legal experience as eligibility criteria for appointing technical members.

The petitioner explains that the purpose of this provision seemed to sidestep the provisions of Section 411(2) relating to the appointment of judicial members.

"The provisions of Section 411(3) appeared to be enacted as a back door entry to the Tribunal for persons with the legal background but who did not meet the criteria (section 411(2))."

It is the grievance of the petitioner that in spite of the Supreme Court's order and the newly added provision on the qualifications of Technical Members, Rules "almost identical" to the original Section 411(3) were introduced for the purposes of appointing Technical Members, vide the Appellate Tribunal and other authorities (Qualifications, Experience and other terms of service of Members)

Pursuant to the Rules, the Central Government released a notification dated 12 January 2017, along with its subsequent amendments and notification dated 10 May 2019, inviting applications for appointment as Technical Members from persons with 25 years of legal experience.

The petitioner argued that the Rules should never have come into force when almost identical provisions were declared unconstitutional under Section 411(3).

The matter will be heard on 1st May 2020.

Tagged: National Company Law Appellate Tribunal   NCLAT   Delhi High Court   Chief Justice DN Patel   Justice C Hari Shankar   Central Government   Companies Act   2013  
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