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HC notice on plea over appointment of judicial member as acting president in NCLT
A bench comprising Justices C Hari Shankar and Om Prakash Shukla observed this while issuing notice in a petition filed by NCLT Technical Member Kaushalendra Kumar Singh
The Delhi High Court on Friday prima facie observed that where the statute provides for the senior-most member of the National Company Law Tribunal (NCLT) to be appointed as Acting Chairperson, any practice of considering only a judicial member as senior for such appointment, contrary to the statute, cannot be continued.
A bench comprising Justices C Hari Shankar and Om Prakash Shukla observed this while issuing notice in a petition filed by NCLT Technical Member Kaushalendra Kumar Singh. Singh challenged the Central Administrative Tribunal’s (CAT) April 8 order dismissing his plea against the appointment of Judicial Member Bachu Venkat Balram Das as Acting President.
On March 16, the Centre entrusted Das with the additional charge of acting President for a period of six months, starting March 17, or until a regular President is appointed, whichever comes first. CAT on April 8 had dismissed Singh’s petition against the Centre’s March 16 decision saying that it did not have the jurisdiction to entertain the same.
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The court termed the issue as important and asked Centre and Das to file their response.
“If the statute says senior most person has to be and if he is a person who has been appointed prior to the person who is presently acting chairperson, unless there is any other rule defining seniority, then there is “prima facie” substance in what he says that he is senior. If he is senior, then whether he is judicial, technical or whatever and whatever be the fate of the institution, it is irrelevant because it is a field occupied by statute. Where the field is occupied by statute, we are not going to go outside,” the bench said to Das’s lawyer.
It added, “Please don’t tell us that there is a practice which has been followed for the past umpteen years, where a judicial member is made the president. If the practice is contrary to the statue, we will not perpetuate the practice. We’re making it clear. Issue notice. Given the importance of the issue involved, let reply to the petition be filed by respondent number 1 (Centre) and respondent number 2 (Das).”
The observation came after Das’s counsel submitted that seniority among members of the NCLT, for the purpose of appointing an Acting President, was being determined in accordance with an established convention, under which the judicial member who takes the oath earlier is treated as the senior-most. He added that judicial members thus stood on a distinct footing in matters relating to the appointment of the Acting President, and even the Centre had previously taken this stand.
To be sure, the Centre in an affidavit filed on March 30 in Singh’s petition challenging Centre’s March 16 order before the high court, which was withdrawn, had said that seniority among members of the National Company Law Tribunal (NCLT) for appointing an acting President is determined based on an established convention, under which the judicial member who takes oath first is treated as the senior-most member, since there is no statutory framework prescribing criteria for deciding such seniority.
The Centre stated that the same approach was followed while appointing judicial member Bachu Venkat Balram Das as Acting President of the NCLT instead of the two senior technical members, including Kaushalendra Kumar Singh, who had joined earlier. It is submitted that the appointment was necessitated as the recommendation for appointing a regular President, forwarded by the Centre to the Chief Justice of India in December, was still awaited.
In his petition, filed through advocate Karan Bharihoke, Singh contended that Section 415 read with Section 407 of the Companies Act, 2013, provides that the senior-most member shall act as the Acting President of the NCLT, and that the term ‘member’ includes both judicial and technical members.
On this basis, he asserted that he is the senior-most member of the NCLT, having assumed office on October 1, 2021, whereas Das took charge later on October 18, 2021.
The matter will be next heard on April 20.
