Even as more than 15,000 insolvency and bankruptcy cases are pending before the National Company Law Tribunal, a recent RTI filed by a Gujarat-based activist reveals that in the near future vacancies at the adjudicating authority could be as high as 50%.
It may be mentioned that the tribunal has 15 benches in Delhi, Mumbai, Hyderabad, Ahmedabad, Chennai, Kolkata, Bengaluru, Chandigarh, Cuttack, Jaipur, Kochi, Guwahati and Indore. The RTI filed by Nipun Singhvi, an NCLT lawyer and RTI activist, reveals that as on date, the NCLT has 22 judicial members and 25 technical members. The data reveal that 10 judicial members and 16 technical members are going to retire in 2022, which means that very soon there will be vacancy of almost 50% across the country. Interestingly, 16 of the technical members who are retiring in July this year were appointed in 2019 for three-year terms, as against the five-year tenure, which is normal. None of them has received extensions so far and industry watchers opine that the chance of renewed terms is almost negligible. The NCLT has a sanctioned strength of 63 members just to deal with company law matters and bankruptcy cases.
What is making matters worse is the lack of domain expertise of even existing members, causing long delays in resolving matters relating to mergers and acquisitions, IBC and other financial matters. The activist had also challenged terms of appointment of judicial members in an advertisement dated October 13 last year on the grounds that the same was in contradiction to Supreme Court judgments in the Madras Bar Association vs Union of India and Swiss Ribbons vs Union of India cases. The matter is currently pending before the Gujarat High Court. Previously also, an RTI reply in 2021 had revealed that the six members who had retired were eligible for reappointment, but the government did not extend/renew their tenure.