New Delhi: If the Centre comes across any tangible material against a candidate who is recommended for appointment to a quasi-judicial tribunal after his/her name is cleared by the search-cum-selection committee (SCSC), which is headed by a serving Supreme Court judge, then the former must place the file along with the objections before the panel, the top court has ordered.
A bench of Justices D.Y. Chandrachud and P.S. Narasimha devised the mechanism last week when it was informed that the Appointments Committee of the Cabinet (ACC) had cleared only 22 of the 41 names approved by the SCSC on 21 September 2019 to fill up the vacancies in the Income Tax Appellate Tribunal (ITAT), which deals with disputes arising out of income tax (IT) assessments.
According to government documents produced before the court and submissions made by Attorney General K.K. Venugopal, the ACC had received additional inputs from the Prime Minister’s Office (PMO) regarding the credentials of the candidates cleared by the SCSC. Since the inputs were objectionable, the ACC chose not to proceed with the appointments.
Some of the reasons why the ACC did not proceed with the names were read out in the open court by the judges. One of them was about a lawyer who “did not prepare his brief well” because of which he was admonished by the court several times. Another related to an advocate who was purportedly not sincere to his brief because he “did not defend the department (government) properly in court”.
In the case of some lawyers, the objection was that penalty proceedings had been begun against them by the Central Board of Direct Taxes (CBDT).
This, the court was told, is an exercise undertaken under Section 270A of the IT Act. It is an automatic initiation of penalty proceedings where the income assessed is higher than the income reported.
Disapproving this practice of keeping the SCSC’s recommendations in abeyance, citing new inputs about candidates, the bench ordered on 17 May that if fresh material comes to light about the suggested names, it should be shared with the panel. Non-compliance of this procedure, it added, would be a deviation from fair process.
What surprised the bench was that the government documents were silent about “multi-sources” who provided the additional inputs.
When asked who carried out the exercise of holding an inquiry after the SCSC cleared the names, Venugopal responded that it was done by the PMO.
The most senior law officer refused to divulge the “multi-sources” from where information was collated, adding that it would cause embarrassment to the candidates concerned and the bar association where they are registered.
The bench took strong exception to this and reminded Venugopal that the SCSC constituted to nominate members of various tribunals is headed by a sitting Supreme Court judge and comprises secretary-level government officers. Moreover, it added, selection is made only after the SCSC receives inputs from the Intelligence Bureau (IB).
“Look at the arbitrariness of it all. We have a judge, IAS officers as part of the committee (SCSC),” Justice Chandrachud said. “List of those who apply to become members (in the tribunals) comes to us with inputs from the IB. Suppose there is something about the candidates that comes to be known later, there should be some way that the IB and the committee is told about it.”
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‘Provide additional information to SCSC in a week’
The court’s order came on a contempt petition filed by an advocate association from Bengaluru, which said the legal affairs wing had violated SC guidelines issued in the Madras Bar Association case by not appointing members to the ITAT.
The present exercise for ITAT appointments started on 6 July 2018, with advertisements notifying 37 vacant posts (21 judicial and 16 accountant members).
According to the law governing the appointment and functioning of tribunals, lawyers are eligible to apply as judicial members, while experts in the field can apply as accountant or executive members. Applications of eligible candidates — along with IB inputs on their background and integrity — are forwarded to the SCSC.
Each tribunal has a separate SCSC and, in the case of ITAT, its SCSC is headed by top court judge Justice A.M. Khanwilkar.
Records presented before the SC say that the ITAT SCSC submitted its recommendations on 21 September 2019, and recommended 41 people for appointment as members of the ITAT. Of these, 28 (16 as judicial and 12 as accountant members) were in the confirmed list and 13 in the waitlist.
On 11 September 2021, the ACC approved 13 names, and 9 more on 1 October 2021. Further, the ACC cleared only 16 names from the confirmed list and opted for 6 from the waitlist.
To appoint someone from the waitlist, without exhausting the main list, was not appropriate, the top court was informed by the petitioners in the case.
But Venugopal defended this exercise and argued that the appointment of candidates was legitimate, since the Tribunal Reforms Act, 2021, requires the SCSC to recommend two names per post. Therefore, names from the waitlist could have been considered.
But the AG agreed with the bench’s concern that the SCSC should be updated about any subsequent information gathered against any candidate.
Referring to the CBDT’s penalty proceedings, the bench stated in its order: “It must be emphasised that SCSC, besides being chaired by a judge of the Supreme Court, also consists of two secretaries of the Union Government. A comprehensive exercise is conducted by the committee, including calling for IB’s inputs. All inputs must be placed with SCSC in advance. In exceptional circumstances, where subsequent materials come to light after recommendations, those materials should also be placed before the SCSC.”
It went on to say: “When the candidates recommended by the SCSC are those who have been cleared by the IB after a detailed analysis of their credentials, integrity and other relevant features, evidently, many of the comments which are contained in the feedback column are of subjective nature without any disclosure of underlying material. This would substantially detract from the fairness of the process.”
With regard to names for ITAT, the bench said the government must provide the additional information to the SCSC within a week.
(Edited by Nida Fatima Siddiqui)
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