The government is understood to have recommended Supreme Court Justice Sikri's name for CSAT late last year.
Citing a media report, Congress president Rahul Gandhi said in a tweet that "when the scales of justice are tampered with, anarchy reigns".
Sikri's consent was "taken orally for a vacancy" in the Commonwealth tribunal, sources said.
Sources close to the second senior-most judge after the Chief Justice of India Ranjan Gogoi told PTI that the consent was withdrawn Sunday evening when the judge wrote to the Law Ministry, seeking withdrawal of his consent.
The insinuation linking the CSAT assignment with Justice Sikri's participation in the committee, which decided on the ouster of Alok Verma as CBI director, was wrong, they said.
"Since this consent was taken in the first week of December 2018, it has no connection with the CBI matter for which he became the CJI's nominee only in January, 2019," the sources added.
They said "a totally unjust controversy" has been raised by connecting the two.
"True facts are that sometime in the first week of December 2018, Justice Sikri's consent was taken orally for a vacancy in Commonwealth Secretariat Arbitral Tribunal (CSAT).
"CSAT is meant to decide service disputes between the employees of the Commonwealth Secretariat and the Commonwealth Secretariat itself," sources close to Sikri said.
Justice Sikri was part of the three-member panel along with Prime Minister Narendra Modi and senior Congress leader Mallikajurn Kharge which decided on removal of Verma from the post of CBI Director.
Sikri's vote proved crucial to remove Verma from his post as Kharge opposed the move strongly while the government was pushing for Verma's removal.
On the CSAT issue, the sources said, "It is not an assignment on regular basis. There is no monthly remuneration. There may be two to three hearings in a year. There was no question of staying in London or at any other place."
The government has not got back to him on the CAST assignment, they said.
"The government had approached him for the part-time assignment last month. He gave his consent. The job required attending two to three hearing per year and came without emoluments," the sources said.
Sikri wrote a letter to the competent authority in the government withdrawing his consent.
"He (Justice Sikri) has withdrawn his consent, he has given no reasons. He just wanted to be away from the controversy," a source close to Justice Sikri said.
The source said Justice Sikri "is a man of very simple nature" and he felt that there should not be any controversy over his appointment and that is why he wants to keep himself away from the controversy."
Hitting out at the government, senior Congress leader Ahmed Patel said the Centre has a "lot of explaining to do" on the nomination of Sikri to CSAT.
"The Government has a lot of explaining to do (sic)," Patel said in a tweet tagging a media report.
Congress president Gandhi also tagged the media report in a tweet, saying,"When the scales of justice are tampered with, anarchy reigns."
"This PM will stop at nothing, stoop to anything & destroy everything, to cover up the #RafaleScam. He’s driven by fear. It’s this fear that is making him corrupt & destroy key institutions," he said.
Official sources said nomination of Sikri, who retires on March 6, was made last month following an internal process carried out by the Law Ministry.
The External Affairs Ministry communicated to CSAT about India's nomination, the sources said.
There was no reaction from either the Ministry of External Affairs or the Ministry of Law and Justice on it.
The Commonwealth Secretariat, established in 1965, plays the role of an arbiter in case of disputes among its 53 member-countries.
The CSAT has a total of eight members, including its president. The members are picked up on the basis of regional representations. A CSAT member has a tenure of four years.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)