Madras High Court restrains Government from appointing Technical Members to GSTAT

In an interim order passed on Thursday, the Madras High Court has restrained the Government from appointing technical members to the Goods and Services Tax Appellate Tribunals (GSTAT)..The interim order was passed by a Bench of Justices M Sathyanarayanan and Justice N Seshasayee in a plea filed by the Revenue Bar Association (RBA) challenging the rules concerning the appointment and the terms of service governing the President and Members of the GSTAT i.e. the GSTAT (Appointment and Conditions of Service of President and Members) Rules, 2019..The RBA has posed two broad challenges in this regard. The first concerns the constitution of selection committees which appoints technical members of the GSTAT Benches. In this regard, Rule 3 of the 2019 Rules is relevant. The second concerns the powers vested in the Government to dictate the service conditions of GSTAT members, in which regard Rule 8 is relevant..Under the present regime, the technical members to the GSTAT Benches (National and/or State) are appointed by the Central Government on the recommendations of a selection committee, composed entirely of members from the Executive, with no representation from the higher judiciary..The RBA has pointed out that the selection committee comprises entirely of members from the Executive. Relying on the law laid down in the cases of SP Sampath Kumar v Union of India, Union of India v R Gandhi, Madras Bar Association v Union of India and Shamnad Basheer v Union India, the Association has contended that the manner in which technical members are appointed to the GSTAT under the 2019 rules is unconstitutional. .Appearing for the RBA today, advocate Rahul Unnikrishnan argued that the selection process for the appointment of technical members of the GSTAT has been left entirely to the executive, although the functions of the Tribunal are judicial. It was submitted that this is a direct affront to the basic structure of the Constitution of India..Additional Solicitor General, G Rajagopalan appeared for the State today..The case has been posted to be taken up next on November 4..The RBA has also challenged the validity of Rule 8 of the 2019 Rules. This rule requires the President to apply to the Central Government for sanction of leave. Another issue raised is that the service conditions of Members – such as salaries, leave, pay, TA, HRA, and other benefits – has been made equivalent to Group ‘A’ officers of the Government of India of corresponding status. The RBA has argued that this scheme of things would be detrimental to the independence of the tribunal..The Court had earlier deferred hearing in the matter to peruse the judgment passed by the Bench of Justices S Manikumar and Subramonium Prasad last month, which had concluded that the the constitution of the GSTAT under the prevailing GST regime is unconstitutional, in so far as it allows the number of technical members appointed to the tribunal to exceed the number of judicial members..[Read the order].Bar & Bench is available on WhatsApp. For real-time updates on stories, Click here to subscribe to our WhatsApp.