The division bench headed by Justice Abhay Oka also asked the government to initiate and complete the fresh appointment process in six months, by November 2016.
The Commission conducts inquiry into cases of violation of child rights and suggests remedial measures for protection of these rights.
Forum for Fairness in Education, a city-based organisation, has moved the HC, pointing out that the posts of chairman and members of the Commission are vacant since 2011.
The HC agreed that the appointment process was flawed, quashed it, and asked the state to initiate a fresh process.
The court also asked the government to create awareness about child rights and set up a helpline for children within two months.
It directed the government to advertise for the posts in national-level newspapers.