Representing the government, Attorney General Mukul Rohatgi said changes to the selection committee for the Lokpal have yet to be cleared by parliament.
"The judiciary must respect separation of powers and can't direct parliament to pass amendments. It is the wisdom of the parliament to pass it," Mr Rohatgi said.
After the BJP came to power in 2014, the government said the leader of opposition's place in the Lokpal selection committee would stay vacant as the largest opposition group, the Congress, did not qualify with less than 10 per cent seats in parliament. The government later made a concession and decided to include the largest opposition party in the selection panel, but that change is yet to be cleared in parliament.
Other members of the Lokpal selection panel are the Prime Minister, the Lok Sabha Speaker, the Chief Justice of India or a Supreme Court judge, and an eminent jurist recommended by the other members.
A group of NGOs and activists have asked the court to step in saying it has been three years since the Lokpal law was passed but the ombudsman has not been appointed.
Changes to other laws have been cleared in parliament to enable the Congress to participate in the selection of the chiefs of the CBI, the Information Commission and the Vigilance Commission.
Prashant Bhushan, who was a part of social activist Anna Hazare's campaign for a Lokpal, questioned the delay.
"The formation committee would hold PM, Speaker... and they said that they have not yet declared the leader of Opposition... The law was made three years back but not brought into force," Mr Bhushan said, adding, "Modiji did not allow Lokpal in Gujarat for 10 years. When they had to appoint a CBI director, then immediate amendments were made. But right now there is nothing."