SC Strikes Down 25-Year Experience Rule for CAs in Tribunals, Citing Parity With Advocates

In a landmark case, several petitions before the Supreme Court challenged amendments introduced through the Finance Act, 2017, as modified by the 2021 Ordinance and the Tribunal Rules, 2020. These provisions dealt with qualifications, appointments, service conditions, tenure and selection processes for members of various tribunals. The Supreme Court had earlier struck down several provisions of the Tribunal Reforms Act, 2021, in the Madras Bar Association case, including the requirement that advocates must be at least 50 years old for Tribunal appointments.

Thereafter, the Institute of Chartered Accountants of India (ICAI) sought clarification, pointing out that the Tribunal Reforms Act required Chartered Accountants to have a minimum of 25 years of experience to qualify as Technical Members of tribunals such as the Income Tax Appellate Tribunal. ICAI argued that this effectively meant that CAs could only be considered after crossing age 50, mirroring the very condition already held unconstitutional for advocates. The matter was mentioned before a bench led by the CJI, which examined the parity claim.

Issues before the Apex Court:

1. Whether the requirement of 25 years of experience for Chartered Accountants to be technical members in tribunals is arbitrary and unconstitutional.

2. Whether the amendments introduced by Section 184 of the Finance Act, 2017, infringed the constitutional requirement of judicial independence.

3. Whether the 2020 Tribunal Rules regarding qualifications, appointment procedures, tenure, and selection committees violated the doctrine of separation of powers.

SC’s Bench Decided: The Supreme Court accepted the ICAI’s submission and held that the 25-year experience requirement for Chartered Accountants is unconstitutional. The Court said that if such a condition were upheld, CAs would effectively enter service only after the age of 50, which was the very reasoning applied while striking down the parallel requirement for advocates. The bench clarified that the same logic extends to CAs and that they must be considered for appointment without insisting on the 25-year threshold. The Court added that the Union Government must keep this observation in mind while framing the new law to replace the struck-down provisions.

The Supreme Court held that key parts of Section 184 and the 2020 Rules were unconstitutional because they weakened tribunal independence and revived provisions earlier struck down. It invalidated the age and HRA-related provisos, the requirement to recommend two names per post, the government’s discretion to delay appointments, and the four-year tenure clause.

The Court reaffirmed that appointments must remain under judicial control, directed that Search-cum-Selection Committees be led by the CJI or a nominee with only non-voting departmental Secretaries, and ordered the creation of a National Tribunals Commission. It stressed that repeatedly reenacting previously invalidated provisions undermines separation of powers and the constitutional scheme.

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