Sections 35-39 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
After sections 30 to 34 create the Appellate Tribunal, sections 35 to 39 deal with the situations that can arise in office: removal, suspension, defects in the Tribunal's constitution, resignation, an acting Chairperson and staff. The rules differ between the Chairperson and Judicial Member on one side and the Administrative Member on the other.
As per the consolidated text consulted, the Central Government may remove the Chairperson or a Member on five grounds, in consultation with the Chief Justice of the High Court (section 35). The Chairperson or a Judicial Member can be removed only after an inquiry by the Chief Justice of the High Court and a reasonable hearing; an Administrative Member is removed by an order of the Central Government after being heard. Vacancies and defects do not invalidate the Tribunal's acts (section 36). Resignation needs written notice and, unless allowed sooner, the office continues for up to three months (section 37).
How these sections came in
Sections 35 to 39 are in Chapter V (Appellate Tribunal), inserted by the Benami Transactions (Prohibition) Amendment Act, 2016 with the rest of sections 7 to 55 of the principal Act. The text is checked against the Gazette of India copy of that Act (assent 10 August 2016). The 2016 changes were brought into force by notification; the date is not in the sources consulted. The earlier sections of the Chapter are covered in our article on sections 30 to 34.
If the validity of a Tribunal order is in question because of a vacancy or the constitution of a Bench, a legal consultation on how section 36 applies will help you decide whether the point is worth taking.
Section 35: removal and suspension
Section 35(1). The Central Government may, "in consultation with the Chief Justice of High Court", remove from office the Chairperson or any Member who:
| Clause | Ground |
|---|---|
| (a) | has been adjudged as an insolvent |
| (b) | has been convicted of an offence which, in the opinion of the Central Government, involves moral turpitude |
| (c) | has become physically or mentally incapable |
| (d) | has acquired such financial or other interest as is likely to affect prejudicially his functions |
| (e) | has so abused his position as to render his continuance in office prejudicial to the public interest |
Compare section 14 for the Adjudicating Authority. In section 35(1)(b), the test of moral turpitude is "in the opinion of the Central Government"; the section 14 wording does not carry those words. See our article on sections 12 to 17.
Section 35(2). The Chairperson or Judicial Member "shall not be removed from his office except by an order made by the Central Government after an inquiry made by Chief Justice of the High Court in which the Chairperson or Judicial Member has been informed of the charges against him and given a reasonable opportunity of being heard in respect of those charges."
Section 35(3). The Central Government "may suspend from office the Chairperson or Judicial Member in respect of whom a reference of conducting an inquiry has been made to the Chief Justice of the High Court under sub-section (2), until the Central Government passes an order on receipt of the report of inquiry made by Chief Justice of the High Court on the reference."
Section 35(4). The Central Government "may regulate the procedure for inquiry referred to in sub-section (2) in the manner as may be prescribed". The procedure is left to rules, which are not in the sources consulted.
Section 35(5). The Administrative Member "may be removed from his office by an order of the Central Government on the grounds specified in sub-section (1) and in accordance with the procedure notified by the Central Government", with a proviso that he "shall not be removed unless he has been given an opportunity of being heard in the matter".
| Office | Route of removal |
|---|---|
| Chairperson or Judicial Member | Central Government order after inquiry by the Chief Justice of the High Court; charges communicated; reasonable opportunity of being heard; suspension possible during the inquiry |
| Administrative Member | Central Government order on the same grounds, under the procedure notified by the Government; opportunity of being heard |
Section 36: vacancies and defects do not invalidate proceedings
"No act or proceeding of the Appellate Tribunal shall be invalid merely by reason of":
- any vacancy in, or any defect in the constitution of, the Tribunal;
- any defect in the appointment of a person acting as a Member of the Tribunal; or
- any irregularity in the procedure of the Tribunal not affecting the merits of the case.
The word "merely" and the limit on item 3 ("not affecting the merits of the case") are the same as in section 16 for the Adjudicating Authority. The section protects against invalidity on those grounds alone and says no more.
Section 37: resignation
The Chairperson or any other Member "may, by notice in writing under his hand addressed to the Central Government, resign his office". The proviso says the person shall, "unless he is permitted by the Central Government to relinquish his office sooner, continue to hold office until the expiry of three months from the date of receipt of the notice or until a person duly appointed as his successor enters upon his office or until the expiry of his term of office, whichever is earlier."
So a resignation is not instant. The office is held until the earliest of three events: three months from receipt of the notice, the successor entering office, or the end of the term. The Central Government may permit an earlier exit.
Section 38: acting Chairperson
- Vacancy (38(1)): where the Chairperson's office falls vacant "by reason of his death, resignation or otherwise", the senior-most Member acts as Chairperson until a new Chairperson, appointed under the Act, enters upon his office.
- Absence or illness (38(2)): when the Chairperson is unable to discharge his functions "owing to absence, illness or any other cause", the senior-most Member discharges those functions until the Chairperson resumes his duties.
This mirrors section 15 for the Adjudicating Authority.
Section 39: staff
- Section 39(1): the Central Government "shall provide the Appellate Tribunal with such officers and employees as it may thinks fit". Printing slip: "may thinks fit" is printed with the extra "s"; it is quoted as it appears.
- Section 39(2): the officers and employees "shall discharge their functions under the general superintendence of the Chairperson".
- Section 39(3): their salaries, allowances and other conditions of service "shall be such, as may be prescribed". Rules are not in the sources consulted.
Who is affected
- Parties to an appeal, who may ask whether a Bench was validly formed or whether a vacancy affects an order, and should read section 36 before relying on such a point.
- Members and prospective Members, for whom the removal and resignation rules set out their position.
- Practitioners, who will find the structure of sections 35 to 39 closely parallel to sections 14 to 17 for the Adjudicating Authority, with the added inquiry safeguards for the Chairperson and Judicial Member.
Practical example
Aman Kohli's appeal is heard by a Bench when one seat in the Tribunal is vacant. He argues that the vacancy makes the Tribunal's order invalid. Section 36 says no act or proceeding is invalid merely by reason of a vacancy or a defect in the constitution of the Tribunal. Aman's counsel therefore looks at whether the vacancy affected the merits of his case and what the other sections of the Act provide, rather than relying on the vacancy alone.
Other laws and later amendments
Sections 35 to 39 name no other statute. Where other sections refer to the Income-tax Act, 1961 or the procedural codes, check the current law for the corresponding provisions. Later amendments to the Act are not in the sources consulted; check them.
Need help with a Tribunal question?
Questions about who sat on a Bench, whether a vacancy matters or how a Member can be removed are narrow points that turn on the text. If you want one examined for your appeal, our legal consultation service can read the order and sections 35 to 39 with you.
Key takeaways
- Removal on five grounds is by the Central Government, in consultation with the Chief Justice of the High Court.
- The Chairperson or a Judicial Member is removed only after an inquiry by the Chief Justice of the High Court and a reasonable hearing; suspension is possible during the inquiry.
- An Administrative Member is removed by order of the Central Government under a notified procedure, after being heard.
- Vacancies, constitutional or appointment defects and irregularities not affecting the merits do not by themselves invalidate acts (section 36).
- Resignation is by written notice; the office continues for up to three months unless permitted sooner (section 37).
Read next
- Sections 30 to 34: the Appellate Tribunal
- Sections 40 to 44: procedure, powers and Benches of the Appellate Tribunal
- Sections 12 to 17: term, removal and staff of the Adjudicating Authority
- Appellate Tribunal under PMLA
Disclaimer: Based on a third-party consolidated text of the Prohibition of Benami Property Transactions Act, 1988 as amended by the Benami Transactions (Prohibition) Amendment Act, 2016, checked against the Gazette of India copy of that amending Act (11 August 2016), as consulted on 2 October 2026. The commencement notification, the rules and later amendments should be checked. This article is general information, not legal advice; check the official text before acting.