National Company Law Tribunal: MCA invites applications for filling 8 Judicial Members, 11 Technical Members posts

The Corporate Affairs Ministry has set the ball rolling for filling vacancies in the various benches of National Company Law Tribunal (NCLT), which is the main adjudicating authority for insolvency and bankruptcy cases (IBC).

It has invited online applications for filling 8 judicial Members and 11 Technical Members posts. The online applications have to be submitted by August 12, the MCA has said.

Interestingly, the MCA has, while inviting applications, clarified that the number of vacancies are tentative and may decrease or increase without prior notice. Currently, NCLT has sanctioned strength of 62 Members across various Benches. The number of vacancies are significantly high, sources said.

Also the MCA has now stipulated that a person would not be eligible for appointment as a Member unless he/she has completed the age of 50 years as on the last date of receipt of online application. 

After joining as a Member in a Tribunal, the Member concerned would have to complete two years of service before looking to move to any other assignment or post in any other organisation, the MCA has stipulated.

MCA has also highlighted that every selected Member can hold office for a period of five years  and would be eligible for re-appointment for another term of five years. This is however subject to the maximum age limit of 65 years.

The process for appointment, however, would be subject to orders/outcome of the Writ Petition filed and pending in the Supreme Court, the MCA has said. 

The legal challenge

Meanwhile, the legal challenge to Section 3(1) of Tribunal Reforms Act 2021 —which had laid down 50 years as the age eligibility criteria for appointment as chairperson or member of a tribunal— is expected to come up before the apex court on July 26. 

The government had been relying on this provision to ensure that candidates below the age level of fifty years are not considered for appointments as NCLT Members.

The functioning of NCLT in the country has from time to time been affected by large number of vacancies in the Benches. At one point last year as much as 40 per cent of the NCLT Benches were vacant.

 The Centre had in recent years been taking measures to address the vacancy issues in NCLT and other Tribunals. The Centre had in August last year enacted the Tribunal Reforms Act 2021.

Dinesh Pednekar, Partner, Economic Law Practice said that the Supreme Court had in the matter of Madras Bar Association vs Union of India (July 14, 2021) struck down the Tribunal Reforms (Rationalization and Conditions of Service) Ordinance, 2021, which had inter alia fixed eligibility criteria of 50 years for appointment of Members to Tribunals.

The Parliament subsequently enacted The Tribunal Reforms Act, 2021 (TRA) which once again prescribed the eligibility criteria of 50 years for appointment. 

“The constitutional validity of TRA is under challenge before the Supreme Court and is likely to be decided on July 26, 2022. Accordingly, the invitation dated July 12, 2022 issued by the MCA being in consonance with the TRA will be subject to orders of the Supreme Court,” Pednekar told BusinessLine.