In a major step toward reforming the consumer dispute resolution system, the Supreme Court on May 21 issued directions to the Union of India to consider establishing a permanent forum—such as a Consumer Tribunal or Consumer Court—comprising sitting or retired judges and full-time members with proper infrastructure and financial resources.
The bench, led by Justices Abhay S. Oka and M.M. Sundresh, asked the Union to file an affidavit within three months regarding the feasibility of setting up such a permanent adjudicatory forum. The Court emphasized the need for permanency in appointments and structure.
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"The Union of India is directed to file an affidavit on the feasibility of a permanent adjudicatory forum for consumer disputes... Such a forum shall consist of permanent members, including both staff and Presiding officers. The Union of India may also consider facilitating sitting Judges to head the fora," the Court said.
The Court noted that consumer rights are rooted in the Constitution and stressed that tenure-based appointments weaken motivation and efficiency.
"The security of tenure attached to an office administering justice, enhances its efficiency and functionality... Impermanence would affect the quality of decisions and thus, cause injury to consumers," the bench observed.
The Court asked the Union to notify new recruitment rules within four months. Once these rules are notified, all states must complete recruitment under them within another four months.
"We direct the Union of India to notify the new rules within a period of four months... Upon notifying the new rules, all the states are directed to complete the post-recruitment within a period of four months thereafter."
To protect ongoing appointments, the Court granted interim relief by dividing members into seven categories:
- Category 1: Current members in Maharashtra may continue till new appointments.
- Category 2: Members earlier terminated but eligible for reappointment will be considered under new rules.
- Category 3: Pre-2021 appointees will serve full tenures and may get extensions.
- Category 4: Judicial members in other states to complete terms with possible extensions.
- Category 5: Selected but unappointed candidates (due to stay orders) must now be appointed.
- Category 6: Non-judicial members cleared exams but not appointed must be appointed immediately.
- Category 7: Reappointment seekers will be reviewed under new rules; non-judicial members must retake written exam and interview, while judicial members are exempt.
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Background of the Case
This matter stems from an appeal against the Bombay High Court's judgment, which struck down Rule 6(1) of the 2020 Consumer Protection Rules, stating it violated judicial independence by giving the executive dominance in the Selection Committee. The Court relied on precedents such as Rojer Mathew and Madras Bar Association cases.
It also partially invalidated Rule 10(2) concerning tenure extensions and temporarily applied Rule 8(18) of the 2019 Rules due to the absence of clear reappointment provisions.
The Supreme Court’s directions aim to ensure judicial independence, transparency in appointments, and better protection for consumer rights.
Case Title: Ganeshkumar Rajeshwarrao Selukar & Others vs. Mahendra Bhaskar Limaye & Others, Civil Appeal No. 9982/2024
