In response to a question in the Lok Sabha on December 2, 2024, the Minister of State for Corporate Affairs, Harsh Malhotra, addressed concerns raised about political appointments in the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT). He clarified that the appointment process for members in both tribunals involves a dynamic collaboration between the Executive and Judiciary, with selections made based on recommendations from the respective committees led by the Chief Justice or their nominee. These committees ensure judicial dominance, with the Chairperson holding a casting vote to maintain impartiality. Regarding delays in case disposal under the Insolvency and Bankruptcy Code (IBC), the Minister cited factors such as the complexity of cases, stakeholder cooperation, and procedural delays, including frequent adjournments and interim applications. On the matter of disregarding Supreme Court directions, the response emphasized that the Supreme Court’s judgments are binding on all lower courts and tribunals, ensuring uniform application of the law.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
LOK SABHA
UNSTARRED QUESTION NO. 986
ANSWERED ON MONDAY, THE 02nd of DECEMBER, 2024/
Agrahayana 11, 1946 (Saka)
Political Appointments in NCLT and NCLAT
QUESTION
- PROF. SOUGATA RAY:
Will the Minister of CORPORATE AFFAIRS be pleased to state:
a. whether the Supreme Court has passed any comments on the political appointments in National Company Law Tribunal and National Company Law Appellate Tribunal;
b. if so, the details thereof;
c. the reasons behind the “lack of timely admission and disposal” of applications under the Insolvency and Bankruptcy Code (IBC), as opined by the Hon’ble Supreme Court;
d. whether there is a “growing tendency” to disregard Supreme Court directions by the authorities of such bodies; and
e. if so, the details thereof and the reasons therefor?
ANSWER
MINISTER OF STATE IN THE MINISTRY OF CORPORATE AFFAIRS; AND MINISTER OF STATE IN THE MINISTRY OF ROAD TRANSPORT AND HIGHWAYS
(HARSH MALHOTRA)
(a) and (b): The process of filling up the posts of Members in the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) is a dynamic, integrated, and continuous collaboration between the Executive and the Judiciary. Appointments are made based on the recommendations of the Selection Committee for NCLT and the Search-cum-Selection Committee for NCLAT. Both Committees, chaired by the Hon’ble Chief Justice of India or his nominee, are structured to ensure judicial dominance in the appointment process. The Chairperson of each committee holds a casting vote, reinforcing impartiality and maintaining the integrity of the selection process.
(c) Delays in case disposal are influenced by multiple factors such as the complexity of facts involved, cooperation of stakeholders, and procedural issues. Adjournments and the filing of numerous interim applications also contribute to delays.
(d) The Supreme Court, as the Apex Court of India, is the highest authority in the judicial hierarchy. Its orders and judgments are binding on all Courts and Tribunals across the entire territory of India, ensuring uniformity and consistency in the application of the law.
(e) Does not arise.
