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The petition filed by the Madras Bar Association challenging the creation National Company Law Tribunal and National Company Law Appellate Tribunal under the Companies Act 2013 will be heard by the Supreme Court bench comprising CJI Ranjan Gogoi, and Justices N V Ramana, D Y Chandrachud, Deepak Gupta and Sanjiv Khanna.
The issue before the five judges bench will examine the constitutional validity of Chapter XXVII comprising Sections 407 to 434 of the Companies Act 2013 which constitute NCLT and NCLAT.
The petitioner has alleged that the basic structure of constitution will be affecting the judicial independence with the creation of NCLT and NCALT. It argues that the members of these Tribunals, which are to exercise powers otherwise enjoyed by the High Courts, can be easily removed by the central executive and therefore judicial independence is heavily compromised.
The issue was earlier heard by a three judges' bench of Justices T S Thakur(later CJI), R F Nariman and P C Pant on February 18, 2015, which has now been referred to the above stated larger bench. The issue expressed is,"substantial points of law involving interpretation of constitution falls for determination”. A similar challenge was faced by the Madras Bar Association against National Tax Tribunal was dealt with by a constitution bench, where the Constitution Bench had declared National Tax Tribunal unconstitutional on September 25, 2014..
The National Tax Tribunal judgment authored by Justice Nariman and Justice Chelameshwar dealt with Article 323A & 323B along with the doctrine of separation of powers and the emergence of tribunalization in India how the judicial power of courts has been curbed by transferring cases to tribunals under direct supervision of the executive.
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