2023 (2) TMI 489 - HC - Companies Law

NCLT lacks authority to impose dress code; High Court rules in favor of Advocates Act.

The High Court held that the National Company Law Tribunal (NCLT) lacked jurisdiction to impose a dress code for advocates, as this authority rests with ... Ultra vires - Power of Tribunal to regulate procedure - Bar Council of India Rules on advocates' dress - Power of High Courts to make rules as to conditions of practice under Section 34 of the Advocates Act - Wearing of Advocates' gown optional - Judicial review of tribunals by High Courts under Articles 226/227Ultra vires - Power of Tribunal to regulate procedure - Bar Council of India Rules on advocates' dress - Power of High Courts to make rules as to conditions of practice under Section 34 of the Advocates Act - Legality of the NCLT order dated 14.11.2017 imposing mandatory wearing of gown by advocates before the Tribunal. - HELD THAT: - The Tribunal relied on Rule 51 (power to regulate procedure) and on administrative powers of the President under Rule 16(f) to direct wearing of gowns. The Court held that those provisions empower the Tribunal to regulate its procedure and administrative functioning but do not enable the Tribunal to frame or override rules governing advocates' professional dress where those rules have been prescribed by the competent authority. The Bar Council of India Rules and the statutory scheme (Section 34 of the Advocates Act vesting rule making power in High Courts as to conditions of practice) govern the form of dress for advocates. An instruction by the Tribunal that conflicts with the Bar Council rules and goes beyond procedural regulation is ultravires the Act and without authority. Accordingly, the 14.11.2017 instruction is illegal and without jurisdiction. [Paras 11, 12]The order dated 14.11.2017 is ultravires and is set aside.Wearing of Advocates' gown optional - Bar Council of India Rules on advocates' dress - Whether wearing of advocates' gown is mandatory before tribunals other than the Supreme Court and High Courts. - HELD THAT: - Having regard to the Bar Council of India Rules (Chapter IV) and the statutory scheme, the Court observed that wearing of the advocates' gown is optional except when appearing in the Supreme Court or High Courts. The Rules explicitly distinguish between forums where gown is mandatory and where it is optional; tribunals fall within the latter category unless a competent rule making authority prescribes otherwise. The Tribunal's attempt to make gown compulsory therefore conflicted with the established statutory/regulatory position. [Paras 5, 6, 12]Wearing of the advocates' gown is optional before courts other than the Supreme Court and High Courts; it is not mandatorily prescr ibed for tribunals by the NCLT.Judicial review of tribunals by High Courts under Articles 226/227 - Modification and quashing - Effect of the subsequent NCLT proceeding dated 27.01.2023 and the court's final disposition of the impugned order. - HELD THAT: - The Court took on record the NCLT proceeding of 27.01.2023 which modified the earlier instruction and aligned practice with the Bar Council Rules. Notwithstanding that modification, the High Court proceeded to quash the original impugned order of 14.11.2017 on the legal grounds articulated. The Court noted that tribunals remain amenable to supervisory jurisdiction of the High Court and therefore could adjudicate the challenge and set aside the impugned instruction. [Paras 11, 13]The subsequent NCLT modification is recorded; in any event the original order of 14.11.2017 is quashed.Final Conclusion: Writ petition allowed: the NCLT order dated 14.11.2017 imposing mandatory wearing of gown by advocates is ultravires and set aside; wearing of advocates' gown is optional before forums other than the Supreme Court and High Courts; the NCLT's subsequent modification is noted and the impugned order is quashed. Issues Involved:1. Validity of the dress code imposed by the National Company Law Tribunal (NCLT) for advocates.2. Jurisdiction of the NCLT to prescribe dress code for advocates.3. Conflict between the NCLT's dress code order and the Advocates Act, 1961, and the Bar Council of India Rules.4. Authority of High Courts to regulate the dress code for advocates.Issue-wise Detailed Analysis:1. Validity of the dress code imposed by the National Company Law Tribunal (NCLT) for advocates:The petitioner, an advocate and member of the Institute of Company Secretaries of India, challenged the NCLT's order dated 14.11.2017, which mandated the wearing of gowns by advocates appearing before the Tribunal. The petitioner argued that this order conflicted with the Advocates Act, 1961, and the rules framed under Section 49 (1) (gg) of the Advocates Act, which prescribe the form of dresses or robes to be worn by advocates. The petitioner cited the Kerala High Court's decision in Jose v. State of Kerala, which held that the insistence on a particular dress code by an authority was misconceived and uncalled for.2. Jurisdiction of the NCLT to prescribe dress code for advocates:The petitioner contended that the NCLT invoked Rule 51 of the NCLT Rules, 2016, which allows the Tribunal to regulate its own procedure, but this power does not extend to prescribing dress codes for advocates. The petitioner further argued that the NCLT's order was in direct conflict with the statutory rules framed by the Bar Council of India under the Advocates Act, 1961, and that only the High Courts have the authority to frame rules regarding the dress code for advocates.3. Conflict between the NCLT's dress code order and the Advocates Act, 1961, and the Bar Council of India Rules:The High Court noted that the Advocates Act, 1961, and the Bar Council of India Rules explicitly prescribe the dress code for advocates. According to these rules, wearing a gown is optional except when appearing in the Supreme Court or High Courts. The High Court emphasized that the NCLT's order mandating the wearing of gowns was contrary to these statutory rules and therefore ultravires the Act.4. Authority of High Courts to regulate the dress code for advocates:The High Court highlighted that Section 34 of the Advocates Act, 1961, empowers only the High Courts to make rules laying down the conditions for practice, including the dress code for advocates. The High Court also referred to the Supreme Court's decision in Harish Uppal v. Union of India, which affirmed that the right of appearance in courts is within the control and jurisdiction of the courts, and only the High Courts have the authority to frame rules regarding the dress code for advocates.Conclusion:The High Court concluded that the NCLT's order dated 14.11.2017 was without jurisdiction and authority, and had no basis in law. The High Court quashed the impugned order, stating that any instruction or direction by the Tribunal prescribing the dress code for advocates, especially when it runs contrary to the statutory rules, is illegal. The High Court also took note of the NCLT's subsequent order dated 27.01.2023, which superseded the earlier instruction and aligned with the Bar Council of India Rules. The writ petition was allowed, and the impugned order was quashed.