TaxTMI 
TaxTMI 
1997 (3) TMI 90
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.... P. Mahale, D. Ramakrishna Reddy, Mrs. D. Bharathi Reddy, S.K. Mehta, Dhruv Mehta, Fazlin Anam, Ms. Monika Jairath, M.P. Raju, Manmohan, T.U. Rajan, L.J. Vadakara, Rathin Das, S. Murlidhar, Rana, Ms. Sucharita Mukherjee, N. Praveer Choudhary, K.K. Mani, Ms. Rani Chhabra, T.V.S.N. Chari, R.K. Mehta, Ms. Lily Thomas, Anip Sachthey, Ms. Mridula Ray Bhardwaj and A. Bhattacharjee, for the parties. Party in person: Kiran K. Shah, for the parties. Senior Advocates: Rama Jois, Dr. Shankar Gosh, Dr. D.P. Pal, Sundarananda Pal, K.K. Venugopal, B. Sen, N.S. Hegde, Tapas Ray, M.L. Verma, P.P. Rao, Shanti Bhushan, A.K. Ganguli, S. Ramachandra Rao, U.N. Bachawat and Kapil Sibal, for the parties. JUDGMENT The judgment of the court was delivered by A. M. AHMADI C. J. I.--The special leave petitions, civil appeals and writ petitions which together constitute the present batch of matters before us owe their origin to separate decisions of different High Courts and several provisions in different enactments which have been made the subject of challenge. Between them, they raise several distinct questions of law; they have, however, been grouped together as all of th....
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....ions and the circumstances which led to the decision in Sampath Kumar's case [1987] 1 SCC 124, the referring Bench reached the conclusion that on account of the divergent views expressed by this court in a series of cases decided after Sampath Kumar's case [1987] 1 SCC 124, the resulting situation warranted a fresh look by a larger Bench over all the issues adjudicated by this court in Sampath Kumar's case [1987] 1 SCC 124, including the question whether the Tribunal can at all have an Administrative Member on its Bench, if it were to have the power of even deciding the constitutional validity of a statute or (article 309) rule, as conceded in Chopra's case [1987] 1 SCC 422. The post Sampath Kumar cases which caused the Division Bench to refer the present matter to us are as follows : J. B. Chopra v. Union of India [1987] 1 SCC 422, M. B. Majumdar v. Union of India [1990] 4 SCC 501, Amulya Chandra Kalita v. Union of India [1991] 1 SCC 181, R. K. Jain v. Union of India [1993] 4 SCC 119 and Dr. Mahabal Ram v. Indian Council of Agricultural Research [1994] 2 SCC 401. Before we record the contentions of learned counsel who appeared before us, we must set out the legal and historical....
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....ny court or other authority immediately before the establishment of such Tribunal as would have been within the (e) ceiling on urban property; (f) Elections to either House of Parliament or the House or either House of the Legislature of a State, but excluding the matters referred to in article 329 and article 329A; (g) Production, procurement, supply and Distribution of foodstuffs (including edible oilseeds and oils) and such other goods as the President may, by public notification, declare to be essential goods for the purpose of this article and control of prices of such goods; (h) offences against laws with respect to any of the matters specified in sub- clauses (a) to (g) and fees in respect of any of those matters; (i) any matter incidental to any of the matters specified in sub-clauses (a) to (h). Jurisdiction of such Tribunal if the causes of action on which such suits or proceedings are based had arisen after such establishment; (3) A law made under clause (1) may- (a) provide for the establishment of a hierarchy of Tribunals; (f) Repeat or amend any order made by the President under clause (3) of....
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....erred upon it by clause (1) of article 323A of the Constitution, Parliament enacted the Administrative Tribunals Act, 1985 (Act 13 of 1985) (hereinafter referred to as "the Act"). The Statement of Objects and Reasons of the Act indicates that it was in the express terms of article 323A of the Constitution and was being enacted because a large number of cases relating to service matters were pending before various courts; it was expected that "the setting up of such Administrative Tribunals to deal exclusively with service matters would go a long way in not only reducing the burden of the various courts and thereby giving them more time to deal with other cases expeditiously but would also provide to the persons covered by the Administrative Tribunals speedy relief in respect of their grievances". Pursuant to the provisions of the Act, the Central Administrative Tribunal, with five Benches, was established on November 1, 1985. However, even before the Tribunal had been established, several writ petitions had been filed in various High Courts as well as this court challenging the constitutional validity of article 323A of the Constitution as also the provisions of the Act; the pri....
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....ections; section 3 is the definition clause. Chapter 11 ("Establishment of Tribunals and Benches thereof") contains sections 4 to 13. Section 4 empowers the Central Government to establish : (1) a Central Administrative Tribunal with Benches at separate places; (2) an Administrative Tribunal for a State which makes a request in this behalf; and (3) a joint Administrative Tribunal for two or more States which enter into an agreement for the purpose. Section 5 states that each Tribunal shall consist of a Chairman and such number of Vice Chairmen and judicial and Administrative Members as may be deemed necessary by the appropriate Government. Sub-section (2) of section 5 requires every Bench to ordinarily consist of one judicial Member and one Administrative Member. Sub-section (6) of section 5, which enables the Tribunal to function through single Member Benches is the focus of some controversy; as will subsequently emerge, and is fully extracted as under : " 5. (6) Notwithstanding anything contained in the foregoing provisions of this section, it shall be competent for the Chairman or any other Member authorised by the Chairman in this behalf to function as a Bench consisting ....
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....y other post under the Central or a State Government carrying a scale of pay which is not less than that of an Additional Secretary to the Government of India; or (b) has, for at least three years, held the post of a joint Secretary to the Government of India or any other post under the Central or a State Government carrying a scale of pay which is not less than that of a joint Secretary to the Government of India, and shall in either case, have adequate administrative experience." Sub-sections (4), (5) and (6) of section 6 provide that all the Members of the Central Administrative Tribunal, the State Administrative Tribunals and the joint Administrative Tribunals shall be appointed by the President; in the case of the State Administrative Tribunals and the joint Administrative Tribunals, the President is required to consult the concerned Governor(s). Sub-section (7) stipulates that the Chief justice of India is also to be consulted in the appointment of the Chairman, Vice-Chairman and Members of all Tribunals under the Act. Section 8 prescribes the terms of office of the personnel of the Tribunal as being for a duration of five years from the date of entering into office;....
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....ital relevance to the controversy before us, and consequently needs to be emphasised, is that section 28, when originally enacted, was in the express terms of clause (2)(d) of article 323A of the Constitution and the only exception made in it was in respect of the jurisdiction of this court under article 136 of the Constitution. However, before the final hearing in Sampath Kumar's case [1987] 1 SCC 124, the provision was further amended to also save the jurisdiction of this court under article 32 of the Constitution; this aspect has been noted in the judgment of Misra J., in Sampath Kumar's case [1987] 1 SCC 124, (at para 14). Since the court in Sampath Kumar's case [1987] 1 SCC 124, had restricted its focus to the provisions of the Act, it expressed itself to be satisfied with the position that the power of judicial review of the apex court had not been tampered with by the provisions of the Act and did not venture to address the larger issue of whether clause (2)(d) of article 323A of the Constitution also required a similar amendment. Section 29 provides for the transfer to the Tribunals under the Act, of all service matters pending in every existing forum before their establ....
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....ase [1987] 1 SCC 124. The Division Bench, therefore, deferred its judgment till the final pronouncement of the decision in Sampath Kumar's case [1987] 1 SCC 124. Thereafter, it analysed the Constitution Bench's decision to arrive at the conclusion that (SCC page 423, para 2 and page 357 of AIR 1987 SC) : "the Administrative Tribunal being a substitute of the High Court had the necessary jurisdiction, power and authority to adjudicate upon all disputes relating to service matters including the power to deal with all questions pertaining to the constitutional validity or otherwise of such laws as offending articles 14 and 16(1) of the Constitution." An aspect which needs to be emphasised is that the Constitution Bench in Sampath Kumar's case [1987] 1 SCC 124, had not specifically addressed the issue whether the Tribunals under the Act would have the power to strike down statutory provisions or rules as being constitutionally invalid. However, the Division Bench in J. B. Chopra's case [1987] 1 SCC 422, felt that this proposition would follow as a direct and logical consequence of the reasoning employed in Sampath kumar's case [1987] 1 SCC 124. In M. P. Majumdar's case [1990] ....
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.... questions of law would be involved the dispute would require serious consideration and thorough examination. There would, however, be many cases before the Tribunal where very often no constitutional issues or even legal points would be involved. . . . We are prepared to safeguard the interests of claimants who go before the Tribunal by holding that while allocating work to the single Member--whether judicial or administrative-in terms of sub-section (6), the Chairman should keep in view the nature of the litigation and where questions of law and interpretation of constitutional provisions are involved they should not be assigned to a single Member (emphasis supplied). In fact, the proviso itself indicates Parliament's concern to safeguard the interest of claimants by casting an obligation on the Chairman and Members who hear the cases to refer to a regular Bench of two Members such cases which in their opinion require to be heard by a Bench of two Members. We would like to add that it would be open to either party appearing before a single Member to suggest to the Member hearing the matter that it should go to a Bench of two Members. The Member should ordinarily allow the matter ....
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....the Tribunals, making them capable of dispensing effective, inexpensive and satisfactory justice. In a separate but concurring judgment, Ahmadi J. (as he then was), speaking for himself and Punchhi J., endorsed the recommendations in the following words (page 134 of [1993] 4 SCC and page 1776 of AIR 1993 SC): "...the time is ripe for taking stock of the working of the various tribunals set up in the country after the insertion of articles 323A and 323B in the Constitution. A sound justice delivery system is a sine qua non for the efficient governance of a country wedded to the rule of law. An independent and impartial justice delivery system in which the litigating public has faith and confidence alone can deliver the goods. After the incorporation of these two articles, Acts have been enacted whereunder tribunals have been constituted for dispensation of justice. Sufficient time has passed and experience gained in these last few years for taking stock of the situation with a view to finding out if they have served the purpose and objectives for which they were constituted. Complaints have been heard in regard to the functioning of other tribunals as well and it is time that ....
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....tending to the American, Australian and British jurisdictions, to ascertain the true import of the concepts of "judicial power", "judicial review" and other related aspects. The judgment has also analysed a contention based on article 371D of the Constitution, but, since that aspect is not relevant to the main controversy before us, we shall avoid its discussion. The judgment of the Andhra Pradesh High Court has, after analysing various provisions of our Constitution, held that under our constitutional scheme the Supreme Court and the High Courts are the sole repositories of the power of judicial review. Such a power, being inclusive of the power to pronounce upon the validity of statutes, actions taken and orders passed by individuals and bodies falling within the ambit of the expression "State" in article 12 of the Constitution, has only been entrusted to the constitutional courts, i.e., the High Courts and this court. For this proposition, support has been drawn from the rulings of this court in Kesavananda Bharati v. State of Kerala [1973] 4 SCC 225, Special Reference No. 1 of 1964, In re [1965] 1 SCR 413, Indira Nehru Gandhi v. Raj Narain [1975] Supp SCC 1, Minerva Mills Lt....
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....the State Legislatures, as the case may be, to enact laws providing for the adjudication or trial by Tribunals of disputes, complaints or offences with respect to a wide variety of matters which have been specified in the nine sub clauses of clause (2) of article 323B. The matters specified cover a wide canvas including, inter alia, disputes relating to tax cases, foreign exchange matters, industrial and labour cases, ceiling on urban property, election to the State Legislatures and Parliament, essential goods and their distribution, criminal offences, etc. Clause (3) enables the concerned Legislature to provide for the establishment of a hierarchy of Tribunals and to lay down their jurisdiction, the procedure to be followed by them in their functioning, etc. Sub-clause (d) of clause (3) empowers the concerned Legislature to exclude the jurisdiction of all courts, except the jurisdiction of the Supreme Court under article 136 of the Constitution, with respect to all or any of the matters falling within the jurisdiction of the Tribunals. The constitutional provision, therefore, invests Parliament or the State Legislatures, as the case may be, with powers to divest the traditional co....
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....isdiction of the High Court in all matters within the jurisdiction of the Taxation Tribunal, the Calcutta High Court had no jurisdiction to entertain the writ petition. However, the High Court proceeded with the case and, by its judgment dated November 25, 1992, declared the impugned provisions to be unconstitutional. These developments have resulted in an interesting situation, where the same provisions have alternately been held to be constitutional and unconstitutional by two different fora each of which considered itself to be empowered to exercise jurisdiction. S. L. P. No. 17768 of 1991 seeks to challenge a judgment of the Madras High Court which has held that the establishment of the Tamil Nadu Land Reforms Special Appellate Tribunal will not affect the powers of the Madras High Court to issue writs. This decision is based on the reasoning that the Legislature of the State had no power "to infringe upon the High Courts' power to issue writs under article 226 of the Constitution and to exercise its power of superintendence under article 227 of the Constitution". It is against these circumstances that we must now test the propositions put forth for our consideration. ....
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....tute for the exercise of the power of a High Court under article 226 of the Constitution; (ii) The impugned provisions of the Constitution, in so far as they exclude the jurisdiction of the Supreme Court and the High Courts under articles 32 and 226 of the Constitution, are unconstitutional. This is for the reason that : (a) Parliament cannot, in exercise of its constituent power confer power on Parliament and the State Legislatures to exclude the constitutional jurisdiction conferred on the High Courts as the power to amend the Constitution cannot be conferred on the Legislatures; and (b) these provisions violate the basic structure of the Constitution in so far as they take away the power of judicial review vested in the Supreme Court under article 32 of the Constitution and the High Courts under articles 226 and 227 of the Constitution. While the Tribunals constituted under articles 323A and 323B can be vested with the power of judicial review over administrative action, the power of judicial review of legislative action cannot be conferred upon them. This proposition flows from Kesavananda Bharati's case [1973] 4 SCC 225, where it was held that under our constitutional....
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....unals and courts situated within their territorial jurisdiction, violate the basic structure of the Constitution; (vi) In view of the aforestated propositions, the decision in Sampath Kumar's case [1987] 1 SCC 124 requires a comprehensive reconsideration. Mr. Shanti Bhushan, appearing for the respondent in C. A. Nos. 153233 of 1993, advanced the following submissions : (i) The 42nd Amendment to the Constitution, which introduced the impugned constitutional provisions, must be viewed in its historical context. The 42nd Amendment, being motivated by a feeling of distrust towards the established judicial institutions, sought, in letter and spirit, to divest constitutional courts of their jurisdiction. The aim was to vest such constitutional jurisdiction in creatures whose establishment and functioning could be controlled by the executive. Such an intent is manifest in the plain words of articles 323A and 323B which oust the jurisdiction, vested in this court and the High Courts under articles 32, 226 and 227 of the Constitution; (ii) The validity of the impugned provisions has to be determined irrespective of the manner in which the power conferred by them has been exercis....
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....ysed the special constitutional status of judges of the High Courts and explained how they are distinct from other tiers of the judiciary. Mr. A. K. Ganguli, appearing for the second and third respondents in C. A. Nos. 1532-33 of 1993 adopted the arguments of Mr. Rama Jois Ind Mr. Bhushan. In addition, he cited certain authorities in support of his contention that the power to interpret the provisions of the Constitution is one which has been solely vested in the constitutional courts and cannot be bestowed on newly created quasi-judicial bodies which are susceptible to executive influences. Mr. K. N. Bhat, the learned Additional Solicitor-General of India represented the Union of India which is a party in C. A. No. 169 of 1994 and C. A. No. 481 of 1989. His contentions are as follows : (i) Clause (2)(d) of article 323-A and clause (3)(d) of article 323B ought not to be struck down on the ground that they exclude the jurisdiction of this court under article 32 of the Constitution. On account of several decisions of this court, it is a well-established proposition in law that the jurisdiction of this court under article 32 of the Constitution is sacrosanct and is indispu....
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....le of discharging their functions. The consistent view of these expert committees has been that the only manner in which the situation can be saved is by transferring some of the jurisdiction of the High Courts, in relatively less important areas, to specially constituted Tribunals which would act as substitutes for the High Courts. In Sampath Kumar's case [1987] 1 SCC 124, this court was required to test the constitutional validity of providing for such a substitute to the High Courts in the shape of the Administrative Tribunals. While deciding the case, this court had actually monitored the amendments to the Act by a series of orders and directions given from time to time as the learned Attorney-General had offered to effect the necessary amendments to the Act to remove its defects. After the necessary amendments were made to the Act, this court was satisfied that there was no need to strike it down as it was of the view that the Act would provide an effective alternative forum to the High Courts for the resolution of service disputes. However, the actual functioning of the Tribunals during the last decade has brought forth several deficiencies which need to be removed. The remed....
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....e Constitution. This, undoubtedly, has the effect of limiting the jurisdiction of this court under article 32 but, being necessary for proper administration of justice, cannot be challenged as unconstitutional. Service matters, which are essentially in the nature of in-house disputes, being of lesser significance than those involving fundamental rights, can also be transferred to Tribunals on the same reasoning. (iv) By virtue of Order XXVII-A, rule 1-A, ordinary civil courts are empowered to adjudicate upon questions of vires of statutory rules and instruments. In view of this situation, there is no constitutional difficulty in empowering Tribunals to have similar powers. (v) Alternatively, in case we are inclined to take the view that the power of judicial review of legislative enactments cannot in any event be conferred in any other court or Tribunal, we may use the doctrine of reading down to save the impugned constitutional provisions. So construed, the High Courts would continue to have jurisdiction to decide the vires of an Act even in the area of service disputes and would, therefore, perform a supervisory role over Tribunals in respect of matters involving constituti....
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....ed by advocates in presenting their cases before the Central Administrative Tribunal and of several complaints regarding the discharge of their official duties. The Registrar of the Principal Bench of the Central Administrative Tribunal, who is the second respondent in C. A. No. 481 of 1989, was represented before us by Mr. Kapil Sibal. The case of the Registrar is that the Tribunals, as they are functioning at present, are not effective substitutes for the High Courts. However, the creation of alternative institutional mechanisms is not violative of the basic structure so long as it is as efficacious as the constitutional courts. He urged us to discontinue the appointment of Administrative Members to the Tribunals and to ensure that the Members of the Tribunals have security of tenure, which is a necessary pre-requisite for securing their independence. Mr. V. R. Reddy, the learned Additional Solicitor-General of India, drew our attention towards the judgment of the Madras High Court which is the subject of challenge in S.L.P. No. 17768 of 1991. Mr. Reddy endeavoured to convince us that the amendments incorporated in the legislation which created the Tamil Nadu Land Reforms S....
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....review is possessed, theoretically, by every court of record, no matter how high or low on the judicial ladder. Though it occurs only infrequently, it is quite possible for a judge in a low-level court of one of the 50 States to declare a federal law unconstitutional. The position can be better appreciated by analysing the text of section 1 of article III of the U. S. Constitution : "Article III, Section 1 : The judicial Power of the United States, shall be vested in one Supreme Court, and in such inferior courts as the Congress may from time to time ordain and establish. The judges, both of the supreme and inferior courts, shall hold their offices during good behaviour, and shall, at stated times, receive for their services, a compensation, which shall not be diminished during their continuance in office." (emphasis added) The judgment of the A. P. High Court is, therefore, correct in assert ing that the judicial power vested in article III of the U. S. Constitution can only be exercised by courts created under section 1 of article 111. However, what must be emphasised is the fact that article III itself con templates the conferment of such judicial power by the U. S. Con....
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.... as in America where the Supreme Court has assumed extensive powers of reviewing legislative acts under cover of the widely interpreted 'due process' clause in the Fifth and Fourteenth Amendments. If, then, the courts in this country face up to such important and none too easy task, it is not out of any desire to tilt at legislative authority in a crusader's spirit, but in discharge of a duty plainly laid upon them by the Constitution. This is especially true as regards the 'fundamental rights', as to which this court has been assigned the role of a sentinel on the qui vive. While the court naturally attaches great weight to the legislative judgment, it cannot desert its own duty to determine finally the constitutionality of an impugned statute." (emphasis added) Over the years, this court has had many an opportunity to express its views on the power of judicial review of legislative action. What follows is an analysis of the leading pronouncements on the issue. While delivering a separate but concurring judgment in the five-judge Constitution Bench decision in Bidi Supply Co. v. Union of India [1956] 29 ITR 717; [1956] SCR 267, 284; AIR 1956 SC 479, 487, Bose J. made the fol....
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....in the domain of adjudication. If the validity of any law is challenged before the courts, it is never suggested that the material question as to whether legislative authority has been exceeded or fundamental rights have been contravened, can be decided by the Legislatures themselves. Adjudication of such a dispute is entrusted solely and exclusively to the jurisdiction of this country." (emphasis added) It is interesting to note that the origins of the power of judicial review of legislative action have not been attributed to one source alone. While Sastri C. J., found the power mentioned expressly in the text of the Constitution, Gajendragadkar C. J., preferred to trace it to the manner in which the Constitution has separated powers between the three wings of Government. In Kesavananda Bharati's case [1973] 4 SCC 225; AIR 1973 SC 1461, a 13-judge Constitution Bench, by a majority of 7 : 6, held that though, by virtue of article 368, Parliament is empowered to amend the Constitution, that power cannot be exercised so as to damage the basic features of the Constitution or to destroy its basic structure. The identification of the features which constitute the basic structure o....
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....rs from exercising and discharging powers and functions entrusted to them. Though the constitution does not lay down the principle of separation of powers in all its rigidity as is the case in the United States Constitution but it envisages such a separation to a degree as was found in Ranasinghe's case [1965] AC 172. The judicial review provided expressly in our Constitution by means a articles 226 and 32 is one of the features upon which hinges the system of checks and balances." (emphasis added) In Indira Nehru Gandhiv. Raj Narain [1975] Supp SCC 1, a fivejudge Constitution Bench had to, Inter alia, test the constitutional validity of provisions which ousted the jurisdiction of all courts including the Supreme Court, in election matters. Consequently, the court was required to express its opinion on the concept of judicial review. Though all five judges delivered concurring judgments to strike down the offending provision, their views on the issue of judicial review are replete with variations. Ray C. J., was of the view that the concept of judicial review, while a distinctive feature of the American constitutional law, is not founded on any specific article in our Constituti....
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.... cannot be considered to be a part of the basic structure in so far as legislative elections are concerned. The foregoing analysis reveals that the judges in Indira Nehru Gandhi's case [1975] Supp SCC 1, all of whom had been party to Kesava nanda Bharati's case [1973] 4 SCC 225, did not adopt similar approaches to the concept of judicial review. While Beg J., clearly expressed his view that judicial review was a part of the basic structure of the Constitution, Ray C. J., and Mathew J., pointed out that unlike in the American context, judicial power had not been expressly vested in the judiciary by the Constitution of India. Khanna J., did not express himself on this aspect, but in view of his emphatic observations in Kesavananda Bharati's case [1973] 4 SCC 225, his views on the subject can be understood to have been made clear. Chandrachud J., pointed out that the Constitution itself excludes judicial review in a number of matters and felt that in election matters, judicial review is not a necessary requirement. In Minerva Mills v. Union of India [1980] 3 SCC 625; AIR 1980 SC 1789, 1799, a five-judge Constitution Bench of this court had to consider the validity of certain pro....
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....der the Constitution to keep the different organs of the State such as the executive and the Legislature within the limits of the power conferred upon them by the Constitution. This power of judicial review is conferred on the judiciary by articles 32 and 226 of the Constitution.... The judiciary is the interpreter of the Constitution and to the judiciary is assigned the delicate task to determine what is the power conferred on each branch of Government, whether it is limited, and if so, what are the limits and whether any action of that branch transgresses such limits. It is for the judiciary to uphold the constitutional values and to enforce the constitutional limitations. That is the essence of the rule of law, which, inter alia, requires that 'the exercise of powers by the Government whether it be the Legislature or the executive or any other authority, be conditioned by the Constitution and the law'. The power of judicial review is an integral part of our constitutional system,. . . . the power a judicial review... is unquestionably ... part of the basic structure of the Constitution. Of course, when I say this I should not be taken to suggest that effective alternative insti ....
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....ts and the Supreme Court under articles 226 and 32 of the Constitution respectively, is part of the basic structure of the Constitution, While expressing his views on the significance of draft article 25, which corresponds to the present article 32 of the Constitution, Dr. B. R. Ambedkar, the Chairman of the Drafting Committee of the Constituent Assembly stated as follows (CAD, Vol. VII, p. 953) : "If I was asked to name any particular article in this Constitution as the most important--an article without which this Constitution would be a nullity--I could not refer to any other article except this one. It is the very soul of the Constitution and the very heart of it and I am glad that the House has realised its importance," (emphasis added) This statement of Dr. Ambedkar has been specifically reiterated in several judgments of this court to emphasise the unique significance attributed to article 32 in our constitutional scheme. [see for instance, Khanna J., in Kesavananda Bharati's case [1973] 4 SCC 225 (p. 818), Bhagwati J., in Minerva Mills' case [1980] 3 SCC 625 (p. 678), Chandrachud C. J., in Fertilizer Kamgar [1981] 59 FJR 237; [1981] 1 SCC 568 (para 11), R. Misra J., i....
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....onstitution as a fundamental instrument for the governance of the country. This approach was specifically adopted by Bhagwati J., in Minerva Mills' case [1980] 3 SCC 625 (at pp. 671-672), and is not regarded as the definitive test in this field of constitutional law. We find that the various factors mentioned in the test evolved by Chandrachud J., have already been considered by decisions of various Benches of this court that have been referred to in the course of our analysis, From their conclusions,, many of which have been extracted by us in toto, it appears that this court has always considered the power of judicial review vested in the High Courts and in this court under articles 226 and 32 respectively, enabling legislative action to be subjected to the scrutiny of superior courts, to be integral to our constitutional scheme.While several judgments have made specific references to this aspect [Gajendragadkar C. J., in the Special Reference case [1965] 1 SCR 413, Beg J. and Khanna J. in Kesavananda Bharati's case [1973] 4 SCC 225, Chandrachud C. J. and Bhagwati J., in Minerva Mills' case [1980] 3 SCC 625, Chandrachud C. J. in Fertilizer Corporation Kamgar's case [1981] 59 F....
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....itutional interpretation. We, therefore, hold that the power of judicial review over legislative action vested in the High Courts under article 226 and in this court under article 32 of the Constitution is an integral and essential feature of the Constitution, constituting part of its basic structure. Ordinarily, therefore, the power of the High Courts and the Supreme Court to test the constitutional validity of legislations can never be ousted or excluded. We also hold that the power vested in the High Courts to exercise judicial superintendence over the decisions of all courts and tribunals within their respective jurisdictions is also part of the basic structure of the Constitution. This is because a situation where the High Courts are divested of all other judicial functions apart from that of constitutional interpretation, is equally to be avoided. However, it is important to emphasise that though the subordinate judiciary or tribunals created under ordinary legislations cannot exercise the power of judicial review of legislative action to the exclusion of the High Courts and the Supreme Court, there is no constitutional prohibition against their performing a supplementa....
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....urts has exploded in an unprecedented manner. The decision in Sampath Kumar's case [1987] 1 SCC 124, was rendered against such a backdrop. We are conscious of the fact that when a Constitution Bench of this court in Sampath Kumar's case [1987] 1 SCC 124, adopted the theory of alternative institutional mechanisms, it was attempting to remedy an alarming practical situation and the approach selected by it appeared to be most appropriate to meet the exigencies of the time. Nearly a decade later, we are now in a position to review the theoretical and practical results that have arisen as a consequence of the adoption of such an approach. We must, at this stage, focus upon the factual position which occasioned the adoption of the theory of alternative institutional mechanisms in Sampath Kumar's case [1987] 1 SCC 124. In his leading judgment, R. Misra J., refers to the fact that since independence, the population explosion and the increase in litigation had greatly increased the burden of pendency in the High Courts. Reference was made to studies conducted towards relieving the High Courts of their increased load. In this regard, the recommendations of the Shah Committee for setting u....
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....y, Calcutta, Delhi, Himachal Pradesh, Jammu and Kashmir and Madras also exercise ordinary original civil jurisdiction. The High Courts also enjoy advisory jurisdiction, as evidenced by section 256 of the Income-tax Act, 1961, section 27 of the Wealth-tax Act, 1957, section 26 of Gift-tax Act, 1958, and section 18 of the Companies (Profits) Surtax Act, 1964. Similarly, there are parallel provisions conferring advisory jurisdiction on the High Courts, such as, section 130 of the Customs Act, 1962, and section 35G of the Central Excises and Salt Act, 1944. The High Courts have also enjoyed jurisdiction under the Indian Divorce Act, 1869, and the Parsi Marriage and Divorce Act, 1936. Different types of litigation coming before the High Court in exercise of its wide jurisdiction bear different names. The vast area of jurisdiction can be appreciated by reference to those names, viz., (a) first appeals; (b) appeals under the letters patent; (c) second appeals; (d) revision petitions; (e) criminal appeals (f) criminal revisions; (g) civil and criminal references; (h) writ petitions (i) writ appeals; (j) references under direct and indirect tax laws; (k) matters arising under the Sales Tax ....
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....t a survey of the functioning of these Tribunals. It was hoped that such a study, conducted after gauging the working of the Tribunals over a sizeable period of more than five years would provide an answer to the questions posed by the critics of the theory. Unfortunately, we do not have the benefit of such a study. We may, however, advert to the report of the Arrears Committee (1989-90), popularly known as the Malimath Committee Report, which has elaborately dealt with the aspect. The observations contained in the Report, to the extent they contain a review of the functioning of the Tribunals over a period of three years or so after their institution, will be useful for our purpose. Chapter VIII of the second volume of the Report, "Alternative Modes and Forums for Dispute Resolution", deals with the issue at length. After forwarding its specific recommendations on the feasibility of setting up "Gram Nyaya layas", Industrial Tribunals and Educational Tribunals, the Committee has dealt with the issue of Tribunals set up under articles 323A and 323B of the Constitution. The relevant observations in this regard, being of considerable significance to our analysis, are extracted in full....
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.... setting up such a Tribunal would itself have to be declared as void under such circumstances. The same would not at all be conducive to judicial independence and may even tend, directly or indirectly, to influence their decision making process, especially when the Government is a litigant in most of the cases coming before such Tribunal. [See S. P. Sampath Kumar v. Union of India [1987] 1 SCR 435; [1987] 1 SCC 124]. The protagonists of specialist Tribunals, who simultaneously with their establishment want exclusion of the writ jurisdiction of the High Courts in regard to matters entrusted for adjudication to such Tribunals, ought not to overlook these vital and important aspects. It must not be forgotten that what is permissible to be supplanted by another equally effective and efficacious institutional mechanism is the High Courts and not the judicial review itself. Tribunals are not an end in themselves but a means to an end; even if the laudable objectives of speedy justice, uniformity of approach, predictability of decisions and specialist justice are to be achieved, the framework of the Tribunal intended to be set up to attain them must still retain its basic judicial charact....
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....article 226/227 cannot wholly be excluded. It has been contended before us that the Tribunals should not be allowed to adjudicate upon matters where the vires of legislation is questioned, and that they should restrict them selves to handling matters where constitutional issues are not raised. We cannot bring ourselves to agree to this proposition as that may result in splitting up proceedings and may cause avoidable delay. If such a view were to be adopted, it would be open for litigants to raise constitutional issues, many of which may be quite frivolous, to directly approach the High Courts and thus subvert the jurisdiction of the Tribunals. Moreover, even in these special branches of law, some areas do involve the consideration of constitutional questions on a regular basis; for instance, in service law matters, a large majority of cases involve an" interpretation of articles 14, 15 and 16 of the Constitution. To hold that the Tribunals have no power to handle matters involving constitutional issues would not serve the purpose for which they were constituted. On the other hand, to hold that all such decisions will be subject to the jurisdiction of the High Courts under article ....
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....ied. In the view that we have taken, no appeal from the decision of a Tribunal will directly lie before the Supreme Court under article 136 of the Constitution; but instead, the aggrieved party will be entitled to move the High Court under article 226/227 of the Constitution and from the decision of the Division Bench of the High Court the aggrieved party could move this court under article 136 of the Constitution. Before moving on to other aspects, we may summarise our conclusions on the jurisdictional powers of these Tribunals. The Tribunals are competent to hear matters where the vires of statutory provisions are questioned. However, in discharging this duty, they cannot act as substitutes for the High Courts and the Supreme Court which have, under our constitutional set-up, been specifically entrusted with such an obligation. Their function in this respect is only supplementary and all such decisions of the Tribunals will be subject to scrutiny before a Division Bench of the respective High Courts. The Tribunals will consequently also have the power to test the vires of subordinate legislations and rules. However, this power of the Tribunals will be subject to one important ....
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....s be stopped. We find it difficult to accept such a contention. It must be remembered that the setting up of these Tribunals is founded on the premise that specialist bodies comprising both trained administrators and those with judicial experience would, by virtue of their specialised knowledge, be better equipped to dispense speedy and efficient justice. It was expected that a judicious mix of judicial members and those with grassroots experience would best serve this purpose. To hold that the Tribunal should consist only of judicial members would attack the primary basis of the theory pursuant to which they have been constituted. Since the Selection Committee is now headed by a judge of the Supreme Court, nominated by the Chief justice of India, we have reason to believe that the Committee would take care to ensure that administrative members are chosen from amongst those who have some background to deal with such cases. It has been brought to our notice that one reason why these Tribunals have been functioning inefficiently is because there is no authority charged with supervising and fulfilling their administrative requirements. To this end, it is suggested that the Tribunal....
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....ade in respect of appointments to Tribunals and the supervision of their administrative function need to be considered in detail by those entrusted with the duty of formulating the policy in this respect. That body will also have to take into consideration the comments of expert bodies like the LCI and the Malimath Committee in this regard. We, therefore, recommend that the Union of India initiate action in this behalf and after consulting all concerned, place all these Tribunals under one single nodal department, preferably the Legal Department. Since we have analysed the issue of the constitutional validity of section 5(6) of the Act at length, we may now pronounce our opinion on this aspect. Though the vires of the 'Provision was not in question in Dr. Mahabal Ram's case [1994] 2 SCC 401, we believe that the approach adopted in that case, the relevant portion of which has been extracted in the first part of this judgment, is correct since it harmoniously resolves the manner in which sections 5(2) and 5(6) can operate together. We wish to make it clear that where a question involving the interpretation of a statutory provision or rule in relation to the Constitution arises for....