Wednesday, February 28, 2024

Plea in SC seeks extension of tenure of NCLT Members

A petition has been filed in the Supreme Court seeking directions to the Ministry of Corporate Affairs to extend tenure of those members of NCLT whose term of 5 years is expiring in May & June 2021, but have not reached the age of 65 years or 67 years, as the case may be. 

The petition is filed by Supreme Court Advocate Amrendra Kumar Singh through Advocate-On-Record Anand Mishra and drawn by Mukul Kumar Shrawat. The petition is listed for hearing on Monday, May 24, before the three-judge bench of Justices L. Nageswara Rao, Hemant Gupta and S. Ravindra Bhat.


Advocate Amrendra Kumar Singh, Supreme Court Advocate

The plea states that as on April 2021, the existing strength of the NCLT consists of its Acting President and a total number of 38 members, out of which 17 are Judicial Members and 21 are technical members, which are much below than the sanctioned strength of 63 members. The petitioner mentions that the Tribunals have been functioning without any regular President of NCLT, for more than a year. He submits that the existing strength of one Acting President and 38 members of the NCLT will further get reduced to 32 members in May and June 2021, as 6 members shall be be completing their 5-year tenure. 

Advocate-On-Record Anand Mishra, Supreme Court

The petitioner further submits that 6 members of NCLT shall be completing their tenure of 5 years in May and June 2021, but they shall have enough period of service left for them to serve, till they attain their age of 65 years or 67 years, as the case may be, in terms of the Section 413(1) of the Companies Act, 2013. 

The Section 413(1) of the Companies Act, 2013 also provides that “The President and every other Member of the Tribunal shall hold office as such for a term of five years from the date on which he enters upon his office, but shall be eligible for re-appointment for another term of five years.”

The petitioner mentions the on-going COVID19 pandemic as a huge factor in causing delay in the entire selection process of the members for the Hon’ble Tribunal, & states the process of recruitment of members which was initiated in year 2019 has been held up as no appointments of new members has been made, till date. The plea says, several selected candidates for the post of members of the NCLT have not received their appointment letters by the Ministry of Corporate Affairs due to this delay, and there is a dire need to maintain the strength of members in the Hon’ble Tribunal. 

Therefore, the plea seeks directions to give extension to those members who have not reached to the age of 65 years but terms of 5-years expiring in May and June 2021 in view of the Section 413(1) of the Companies Act 2013. The plea also seeks directions to extend the term of the Members of the National Company Law Tribunal who shall be completing their tenure by May and June 2021 for a period (5 years or any other period) or until they attain the age of 65 years, whichever is earlier. 

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The plea states in case the tenure of the Members of the Tribunal is not extended for another term, the entire purpose of ‘domain expertise’ shall be defeated, as highlighted by the Supreme Court in a catena of judgments. “On account of delay in the selection procedure for the appointment or extension procedure of members of the Hon’ble Tribunal, adverse effect shall be caused to the Justice Delivery system,” it further states.   


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