Unfortunate That Ministry Of Corporate Affairs Has Hijacked NCLT Staff Appointments : Supreme Court

The Supreme Court on Thursday expressed concern over the Ministry of Corporate Affairs (MCA) taking control of appointments to staff positions at the National Company Law Tribunal (NCLT), observing that the Ministry appeared to be seeking complete control over the institution.

"The Ministry wants to have complete grip over the institution. And that's what's most unfortunate," Chief Justice of India Surya Kant remarked.

A bench comprising CJI Surya Kant, Justice Joymalya Bagchi, and Justice V Mohana made the observations while hearing a matter concerning the appointment of staff members working with the NCLT's judicial members.

Senior Advocate Meenakshi Arora, appearing in the matter, submitted that the entire recruitment process had been outsourced to a private entity, including the appointment of staff attached to judicial members. She expressed apprehension that employees who had been working at the tribunal for nearly eight years could be removed as early as November 1 or 2.

Arora argued that the employees would effectively become private employees despite performing duties connected with the functioning of a judicial institution. She contended that this arrangement could adversely affect the independent discharge of judicial functions.

The CJI initially expressed reservations about entertaining the plea at the instance of employees who had a personal interest in the matter. However, the bench indicated that it would examine the issue in the larger institutional interest, particularly if the NCLT President raised concerns about the arrangement.

"We will not entertain this on behalf of employees who have personal interest in this. We will consider if NCLT President points out," the CJI said, adding that the matter would be taken up after a report was received.

Justice Bagchi observed that while recruitment could be outsourced, the employer-employee relationship should remain with the tribunal.

"Recruitment can be outsourced. But employer-employee relationship should continue," he said.

The CJI agreed that the issue required consideration, emphasising that the power to appoint staff must remain with the NCLT President.

"We are concerned about that part. Let's convey our mind," he said.

The CJI further remarked that the Tribunal's autonomy could not be compromised by allowing private entities to exercise control over staff working with judicial members.

"The entire power of appointment must be with [NCLT] President only," he said.

Arora submitted that although the employees might initially have been engaged on a contractual basis, the recruitment rules had to be followed and the arrangement could raise questions under Articles 14 and 16 of the Constitution, which guarantee equality before the law and equality of opportunity in public employment.

She urged the Court to ensure that no employee was terminated without the NCLT President's approval.

The CJI, however, declined to grant such protection, observing that the Court could not tie down the President's hands. He also cautioned against regularising contractual employees without following the prescribed recruitment process.

"You are also backdoor entrants. I know how contractors play their hands. They don't care about judicial/technical members," the CJI remarked.

Stressing the need to preserve the tribunal's independence, the CJI said that the NCLT President should have complete autonomy in appointments and could resort to recruitment through agencies such as the Union Public Service Commission (UPSC) or the Staff Selection Commission (SSC).

"We will not tie down the President. you are also backdoor entrants. I know how contractors play their hands. They don't care about judicial/technical members. Complete autonomy must be with President. They can take UPSC/SSC. This has been completely hijacked by MCA. That's the problem. Ministry wants to have complete grip - that's most unfortunate. We are issuing notice on larger interest - how to ensure..."