The old adage ‘Dig your well before you are thirsty’ may well explain the predicament the Securities and Appellate Tribunal (SAT), a quasi-judicial body that hears cases related to the stock market and SEBI, is now facing. Yet again, SAT may not be able to hear cases due to lack of quorum as its Presiding Officer JP Devadhar retired on Wednesday. He was appointed in 2013 for a five-year period.

With Devadhar’s retirement, SAT will be left with just one member — CKG Nair — who alone cannot hear cases, since this work requires proper quorum.

It is not the first time that SAT is grappling with such an issue. A similar situation had arisen before Devadhar was appointed in 2013. Then, SAT remained without a presiding officer for nearly two years. However, hearing did take place, as there were two or more members in the Tribunal. But delay in appointing members in 2011 and 2013 saw SAT being completely paralysed, as it could not conduct hearings and cases piled up.

A legal expert said the appointment of SAT member is done by the Appointments Committee of the Cabinet (ACC), which has representation from the RBI and the Finance Ministry.

“The unpreparedness with succession planning in tribunals is an epidemic that ails all governments, regardless of who is in power,” said Somasekhar Sundaresan, senior independent counsel. “When a judge is appointed, the date of retirement is known. Yet, a vacuum emerges every time. If this is the plight of a premier internationally-regarded tribunal, one can only imagine the plight of other courts and tribunals.”

Cases pile up

Apart from SEBI, SAT also hears cases against orders issued by the IRDA and the PFRDA. Appeals and cases pending in SAT for hearing have seen a significant rise over the past five years, mostly due to delay in appointment of members and presiding officer that would constitute a proper quorum.

Another interesting fact that members point out is that a presiding officer, who is a retired high court judge or a chief justice, is necessary for SAT and mere hearings by members could some time leading to errors due to lack of knowledge of the judicial system. SAT members are mostly from outside the judiciary or are retired bureaucrats.

“SAT is an important quasi-judicial institution and it cannot be left headless,” said Sandeep Parekh, former Executive Director at SEBI and founder of Finsec Law Advisors.

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