Kiran Raj

The Supreme Court of India Division Bench of Justice Abhay S. Oka and Justice M. M. Sundresh rendered a pivotal judgment concerning the framework for appointments and the terms of service within consumer redressal fora across the nation. The Court held that specific provisions within the Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of the President and members of the State Commission and District Commission) Rules, 2020, were legally unsustainable. This included findings regarding the composition of the Selection Committee responsible for appointments and the stipulated tenure for the President and members of the State and District Commissions. The Court directed the Union of India to promulgate new rules within a four-month period, mandating the incorporation of a five-year tenure for all officeholders to ensure stability and attract qualified individuals. Additionally, the directives require the revised Selection Committee to comprise a majority of judicial members to uphold the principles of judicial independence.

The genesis of the present appeals and review petitions lies in the evolving landscape of consumer protection legislation in India, particularly concerning the appointment and service conditions of members of consumer fora. The Consumer Protection Act, 1986, was later substituted by the Consumer Protection Act, 2019, effective from August 9, 2019, with the aim of providing a dedicated legal framework for citizens to attain exposure to participative democracy, day-to-day economics, ongoing politics, and environmental protection. This legislative evolution underscored the need for a robust and independent consumer redressal mechanism.

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A significant precursor to the current dispute was the Supreme Court's decision in State of Uttar Pradesh and Others v. All Uttar Pradesh Consumer Protection Bar Association, (2017) 1 SCC 444, which addressed lacunae in the implementation of the 1986 Act. In this judgment, the Court issued directions to the Union Government to frame model rules for adoption by State Governments, ensuring uniformity in the exercise of rule-making power under Sections 10(3) and 16(2) of the 1986 Act. These model rules were to prescribe objective norms for the appointment of members of District Fora, State Commissions, and the National Commission, considering ability, knowledge, and experience, along with commensurate salary, allowances, and conditions of service.

Following this, the State of Maharashtra notified the Consumer Protection (Appointment, Salary, Allowances, and Conditions of Service of President and Members of State Commission and District Forum) Rules, 2019, under the 1986 Act. Subsequently, with the enactment of the 2019 Act, the Union of India introduced a fresh set of rules, namely the Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of the President and members of the State Commission and District Commission) Rules, 2020. These 2020 Rules fixed the tenure of Presidents and Members of the State and District Commissions at four years.

The validity of certain provisions of the 2020 Rules became a subject of challenge. In the first round of litigation, a writ petition and a public interest litigation were filed before the High Court of Bombay, challenging Rules 3(2)(b), 4(2)(c), and 6(9) of the 2020 Rules. These rules pertained to the eligibility criteria for non-judicial members of the State and District Commissions (20 years and 15 years’ experience respectively) and the uncanalized power of the Selection Committee to determine its own procedure. The Division Bench of the High Court of Bombay, vide judgment and order dated September 14, 2021, declared these rules unconstitutional, relying on the Supreme Court's precedents in UPCPBA and Madras Bar Association v. Union of India and Another (2021) 7 SCC 369 (MBA – III).

This decision of the High Court of Bombay was challenged before the Supreme Court in The Secretary Ministry of Consumer Affairs v. Dr. Mahindra Bhaskar Limaye & Ors., 2023 SCC OnLine SC 231 (Limaye – I). On March 3, 2023, the Supreme Court largely upheld the High Court's findings, holding that the experience requirements of 20 and 15 years were arbitrary and that 10 years of experience would suffice. Crucially, the Court also held that Rule 6(9) of the 2020 Rules, which granted unfettered powers to the Selection Committee without mandating a written examination followed by a viva voce, could not be sustained. Exercising its powers under Article 142 of the Constitution, the Supreme Court issued specific directions for conducting a written examination followed by a viva voce for the posts of Presidents and Members of the State and District Commissions.

Following the Limaye-I judgment, the State of Maharashtra issued an advertisement on May 23, 2023, inviting applications for various posts. Concurrently, a Selection Committee was constituted and reconstituted by the State. Three writ petitions were filed before the High Court of Bombay challenging Rules 6(1) and 10(2) of the 2020 Rules, as well as the advertisement and the selection committee notifications. These petitioners included practicing advocates seeking appointment and incumbent members and presidents seeking reappointment.

In the interim, the Union of India notified the Consumer Protection (Qualification for appointment, method of recruitment, procedure of appointment, term of office, resignation and removal of the President and members of the State Commission and District Commission) Amendment Rules, 2023, on September 21, 2023, incorporating some directions from Limaye-I. On October 5, 2023, the State of Maharashtra appointed 112 persons to various posts, and on October 6, 2023, it rejected requests for reappointment.

The High Court of Bombay, vide judgment dated October 20, 2023 (Impugned Order - I), partly allowed the writ petitions, striking down Rules 6(1) and 10(2) of the 2020 Rules, quashing the notifications, and parts of the advertisement concerning Paper II of the written examination. Rule 6(1) was found to suffer from a lack of judicial dominance in the Selection Committee, while Rule 10(2) was struck down for reducing the tenure from five to four years. The High Court also suggested applying Rule 8(18) of the 2019 Rules for reappointments until Rule 6(9) of the 2020 Rules was amended. Separately, the High Court of Bombay, vide another judgment dated October 20, 2023 (Impugned Order - II), held that the Limaye-I directions regarding written examinations applied only to non-judicial members.

In Telangana, the High Court, vide judgment dated February 22, 2024 (Impugned Order - III), confirmed an earlier order setting aside appointments to District Commission members, citing non-adherence to Limaye-I directions, despite the selection process concluding prior to that judgment. The Supreme Court had also issued interim orders, including one on November 10, 2023, staying the effect of Impugned Order-I for four weeks to protect incumbent appointees, which was subsequently extended.

The Supreme Court commenced its observations by delving into the profound essence of consumerism, stating that " Man is what he consumes. It is generally stated that one becomes a consumer from the time of his birth but, in reality, the journey begins much earlier. It extends from before the cradle to beyond the grave." The Court recorded that 'Consumerism' constitutes the very spirit of the Constitution of India, 1950, and that " The rights of a consumer are not merely constitutional or statutory guarantees, but are in fact, natural, and therefore, inalienable." The Court observed that consumer fora " must be mindful of the aforesaid constitutional basis, as a mere dictionary meaning can never do complete justice to the word 'consumer'. "

The Court further stated that consumer litigation is a form of public interest litigation, observing that " Though a consumer seeking to redress his grievance may do so for himself, the benefit of the same often enures to the public, which transacts with various entities, including State instrumentalities. In this way, the exercise of the power vested in a single consumer, to hold any entity accountable, transforms him into a flag bearer of public justice." The Court recorded that " consumer litigation is a form of public interest litigation, which builds an active citizenry, enhancing participatory democracy."

In the context of social justice, the Court observed that " To bring about this social revolution, ‘consumerism’ must be accepted as a social force, as it substantially informs the trajectory of one’s life." It stated, " Plainly speaking, if there is no equality of consumption, there can be no equality of life." The Court also noted that " empowering consumerism would be the most effective way to remove social inequalities." The Court recorded that " it is not only the duty of the State or a goods/service provider, but also of every individual, to make sure that the concept of consumerism flourishes in every possible way, in order to give effect to the Fundamental Rights ensured to the citizens, in adherence with the constitutional mandate."

Regarding politics, the Court observed that " The choice to consume a particular good or service, or not, reflects our political considerations." It stated that " Consumerism thus, runs through the cycle of cause-and-effect vis-à-vis politics. Therefore, the importance of a voter to politics would be felt only when there is social and economic equality. Consumerism is the appropriate tool in achieving this valued objective for a mature democracy."

On economics, the Court observed that " Consumers are the ‘invisible hand’ of the market. It is through their spending decisions, that producers are informed about the kinds and quantities of goods and services to provide." The Court recorded that " the success of all economic activity depends upon the consumer."

Addressing the environment, the Court stated that " At the first blush, the concepts of consumerism and the environment might look distinct and different. However, they are more than interconnected and are, in fact, inseparable." The Court observed the emergence of " Green Consumerism " and its multi-fold relevance, contributing to " reduced environmental pollution with less waste generation, lower levels of carbon emissions, and improved air, water, and soil quality and therefore contribute to better public health."

The Court then turned to the need for change in the consumer redressal mechanism, observing that " Unless policy-makers are conscious about the emergent need to effect necessary changes, including but not limited to structural changes, the existing system might crumble." It stated, " The security of tenure attached to an office administering justice, enhances its efficiency and functionality." The Court recorded, " Impermanence would affect the quality of decisions and thus, cause injury to consumers."

In its analysis of Rule 6(1) of the 2020 Rules, the Court upheld the High Court of Bombay's decision, observing that the rule " suffered from the following infirmities: a. Since the Chairperson is the sole representative of the Judiciary in the three Member Selection Committee, there is a lack of judicial dominance, which is a direct contravention of the doctrine of separation of powers and also an encroachment on the judicial domain. b. There is excessive interference of the Executive in the appointment of Presidents and Members of the State and District Commissions."

The Court held its earlier stance that " Clearly, the composition of the Search-cum-Selection Committees under the Rules amounts to excessive interference of the executive in appointment of members and Presiding Officers of statutory tribunals and would undoubtedly be detrimental to the independence of judiciary besides being an affront to the doctrine of separation of powers."

Regarding Rule 10(2) of the 2020 Rules, the Court observed that " the reduction of the tenure of office from five years as it existed under the 2019 Rules, to four years, was not legally sustainable, especially in view of the dictum in MBA – III (supra). " It further stated that a short stint is " anti-merit " and an attempt to " override the declaration of law by this Court under Article 141 ".

On the validity of Paper II of the written examination, the Court observed that a direction issued under Article 142 of the Constitution " may not be read like a statute. It is only suggestive and can only be construed to be a guiding factor. What must be seen is the substantial compliance of the directions issued, which we find to be present in the instant case."

The Court also observed a violation of natural justice, stating that the appointed candidates " are certainly proper and necessary parties to the litigation, as they have gone through the entire selection process. A decision taking away the civil rights that accrued to them, could not have been rendered, without hearing them." It also recorded that " One cannot be permitted to approbate and reprobate at the same time."

Finally, on the issue of reappointment and the applicability of repealed rules, the Court observed that " Rules formulated under a repealed statute, stand repealed in their entirety, once new Rules under the new/re-enacted statute have come into being. There cannot be two sets of Rules operating the field simultaneously, when the latter has replaced the former." The Court clarified that " in a tenure-based post, there is no vested right to seek reappointment, but only a limited one to seek consideration under the relevant provisions."

In exercise of the powers conferred under Article 142 of the Constitution, the Supreme Court issued several directives to ensure the effective functioning and independence of consumer fora:

• The Union of India is directed to file an affidavit on the feasibility of a permanent adjudicatory forum for consumer disputes (Consumer Tribunal or Consumer Court) within three months, considering the constitutional mandate. This forum should have permanent members, including staff and Presiding Officers, and the Union of India may consider facilitating sitting Judges to head these fora, increasing their strength as needed.

• The Union of India is directed to notify new Rules within four months, strictly adhering to the following principles:

The tenure of office for all positions must be five years, consistent with previous judgments (Rojer Mathew, MBA - III, and MBA - IV).

The Selection Committee's composition must ensure a judicial majority, comprising two judicial members (one as Chairperson) and one executive member, all with voting rights. The concerned Secretary may serve as an ex-officio Member without voting rights.

No written examination or viva voce shall be required for appointment and reappointment to the posts of President of the State Commission, Judicial Members of the State Commission, and President of the District Commission.

A written examination followed by a viva voce shall be required only for appointment and reappointment to the posts of Non-Judicial Members of the State Commission and Members of the District Commission.

Written examinations for appointments to State and District Commissions shall be conducted in consultation with respective State Service Commissions.

The qualification for appointment to the post of President of the District Commission shall be restricted to either a serving or a retired District Judge.

• Upon notification of the new Rules, all States are directed to complete the recruitment process under these rules within four months.

• Regarding the status of appointments to the posts of Presidents and Members of the State and District Commissions:

Persons appointed in Maharashtra vide order dated October 5, 2023: Shall complete their four-year tenure. If their tenure ends before the new recruitment process is complete, their appointment shall continue until the process is finalized.

Persons seeking reappointment in Maharashtra after termination (October 6, 2023): Can be considered under the new Rules. Presidents and Judicial Members of State Commissions and Presidents of District Commissions will not require a written examination or viva voce for reappointment. Non-Judicial Members of State and District Commissions will require both. Pending writ petitions challenging termination will be decided based on this judgment.

Presidents and Members serving prior to Limaye - I: Shall complete their tenure. If their tenure ends before the new recruitment process is complete, their appointment shall continue until the process is finalized.

Presidents of State and District Commissions and Judicial Members of State Commissions in other States (appointed and serving, or selected but not appointed due to stay): Shall complete their tenure. If their tenure ends before the new recruitment process is complete, their appointment shall continue until the process is finalized. Those selected but not appointed due to a stay shall be appointed and allowed to complete their tenure.

Non-Judicial Members of State Commissions and Members of District Commissions selected without written exam/viva voce:

If appointed and serving (selection prior to Limaye - I): Shall complete their tenure. If their tenure ends before the new recruitment process is complete, their appointment shall continue until the process is finalized.

If appointed and serving (selection post Limaye - I): Shall continue until the new recruitment process is complete.

If selected but not appointed: Not entitled to be appointed.

Non-Judicial Members of State Commissions and Members of District Commissions who underwent written exam/viva voce (appointed and serving, or selected but not appointed due to stay): Shall complete their tenure. If their tenure ends before the new recruitment process is complete, their appointment shall continue until the process is finalized. Those selected but not appointed due to a stay shall be appointed and allowed to complete their tenure.

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Persons seeking reappointment in other States after termination: Can be considered under the new Rules. Presidents and Judicial Members of State Commissions and Presidents of District Commissions will not require a written examination or viva voce for reappointment. Non-Judicial Members of State and District Commissions will require both.

The Court clarified that for all appointments allowed to continue vide this Judgment, the tenure shall be a period of four years. Such persons shall not be entitled to claim the benefit of this Judgment qua a five-year tenure, subject to the directions issued hereinabove. The Judgment shall apply prospectively, except to the extent indicated in the directions hereinabove.

Case Title: Ganeshkumar Rajeshwarrao Selukar & Ors. v. Mahendra Bhaskar Limaye & Ors.

Neutral Citation: 2025 INSC 752

Case Number: Civil Appeal No. 9982 of 2024 & Connected Matters

Bench: Justice Abhay S. Oka, Justice M. M. Sundresh

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