Weekly Overview| Supreme Court Judgments: Sep 19 - Sep 23, 2022
|1) Pension rules capable of having more than one interpretation must be interpreted in favor of employee: The Court observed that when financial rules such as pension rules have more than one interpretation, Courts should lean in favor of interpretation favouring the employee.
The Court interpreted sub rule (2) of Rule 25 of the Rules (Rajasthan Civil Services (Pension) Rules, 1996 and observed, "There can be no doubt that resignation from service may entail forfeiture of past service. However, sub-rule (2) of Rule 25 of the Rules (Rajasthan Civil Services (Pension) Rules, 1996) carves out an exception. The said sub-rule clarifies that a resignation with proper permission to take up another appointment whether temporary or permanent, under the Government shall not entail forfeiture of past service."
Cause Title – State of Rajasthan & Others v. O.P. Gupta
Date of Judgment – September 19, 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
2) Pendency of proceedings in parallel forum not sufficient cause for delay in filing application u/s. 9 IBC: The Court held that the pendency of the proceedings in a parallel forum, is not a sufficient cause for the delay in filing an application under Section 9 of the Insolvency and Bankruptcy Code.
The Court also observed that when an appeal is filed against an order rejecting an application on the ground of limitation, the onus is on the Appellant to make out sufficient cause for the delay in filing the application.
Cause Title – M/s. Tech Sharp Engineers Pvt. Ltd. V. Sanghvi Movers Limited
Date of Judgment – September 19, 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
3) Larger bench decision will prevail over bench of lesser strength, irrespective of number of judges constituting majority: The Court observed, "In view of Article 145(5) of the Constitution of India concurrence of a majority of the judges at the hearing will be considered as a judgment or opinion of the Court. It is settled that the majority decision of a Bench of larger strength would prevail over the decision of a Bench of lesser strength, irrespective of the number of Judges constituting the majority."
A Bench of two Judges had referred to the constitution bench the following questions-
• Whether the Kothari Products Ltd. v. State of A.P. line of judgments or the Central Sales Tax vs. Agra Belting Work, line of judgments is correct in law; and
• What should be the proper guidelines for the future for overruling an earlier decision of this Court, and to what extent should the Courts be guided by the propositions in Ningappa Ramappa Kurbar v. Emperor, the observations of Lokur, J. in Supreme Court Advocates-on-Record Assn. v Union of India and the judgment of the Court of Appeal in Harper v. National Coal Board.
Cause Title – M/s. Trimurthi Fragrances (P) Ltd. v. Government of N.C.T. of Delhi
Date of Judgment – September 19, 2022
Coram – Justice Indira Banerjee, Justice Surya Kant, Justice MM Sundresh, Justice Sudhanshu Dhulia, & Justice Hemant Gupta
4) Circumstantial Evidence: Circumstances should form chain indicating that crime was committed by accused and none else: While setting aside the murder conviction of the Appellants-Accused, the Supreme Court has observed that it was a case based on circumstantial evidence, thus circumstances should form a chain indicating that all in human probability the crime was committed by the accused and none else in all probability.
The Bench held, ""As held by this Court in a catena of decisions, in case of a circumstantial evidence, the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the crime was committed by the accused and none else and the circumstantial evidence in order to sustain conviction must be complete and incapable of explanation of any other hypothesis than that of the guilt of the accused and such evidence should not only be consistent with the guilt of the accused but should be inconsistent with his innocence."
Cause Title – Raju @Rajendra Prasad v. State of Rajasthan
Date of Judgment – September 19, 2022
Coram – Justice MR Shah & Justice Krishna Murari
5) Section 34 of UP Trade Tax Act would only be applicable when transfer is made with intention to defraud revenue: The Court while interpreting Section 34 of the UP Trade Tax Act has held that the said provision shall only be applicable in cases where the assessee has transferred the immovable property with the intent of defrauding the revenue.
The Court also held, "Section 34 of the Act shall be applicable only in a case where there is a transfer of immovable property belonging to the original assesee, during the pendency of any proceedings under the Act with the intention of defrauding any such tax or other dues. As per proviso to Section 34, nothing in Section 34 shall impair the rights of a transferee in good faith and for consideration."
Cause Title – The Commissioner, Trade Tax, U.P. v. M/s Radico Khetan Ltd.
Date of Judgment – September 19, 2022
Coram – Justice MR Shah & Justice Krishna Murari
6) Not violative of any fundamental right: SC upholds constitutional validity of Haryana Sikh Gurdwara (Management) Act 2014: The Court upheld the constitutional validity of the Haryana Sikh Gurudwara (Management) Act 2014 which was challenged by way of Writ Petitions before the Court on the ground that it violates fundamental rights guaranteed under Part III of the Constitution.
"Since the affairs of the Sikh minority in the State are to be managed by the Sikhs alone, therefore, it cannot be said to be violative of any of the fundamental rights conferred under Articles 25 and 26 of the Constitution," the Bench held.
Cause Title – Harbhajan Singh v. State of Haryana & Ors.
Date of Judgment – September 20, 2022
Coram – Justice Hemant Gupta & Justice Vikram Nath
7) 1954 Act a special law in respect of agricultural land- SC upholds validity of Section 50(a) of Delhi Land Reforms Act: The Court upheld the constitutional validity of Section 50(a) of the Delhi Land Reforms Act 1954.
The validity of the said provision was challenged on the ground that it was ultra vires of Articles 13, 14, 19, 21 and 254 of the Constitution.
Cause Title – Har Naraini Devi & Anr. v. Union of India & Ors.
Date of Judgment – September 20, 2022
Coram – Justice Hemant Gupta & Justice Vikram Nath
8) MVAT Act & CST Act- Courts must not exercise jurisdiction under Article 226 when alternate remedy is available: While adjudicating upon a suit under Maharashtra Value Added Tax, 2002 and Central Sales Tax Act, 1956, the Court observed that when there is an alternate remedy available, judicial prudence demands that Court refrains from exercising its jurisdiction under constitutional provisions i.e., Article 226 of the Constitution.
The Court held that the High Court committed a serious error in entertaining the Writ Petition against the assessment order and ought to have relegated the Petitioner-Assessee to avail the statutory remedy of appeal and thereafter to avail other remedies provided under the statute.
Cause Title – The State of Maharashtra and Others v. Greatship (India) Limited
Date of Judgment – September 20, 2022
Coram – Justice MR Shah & Justice BV Nagarathna
9) Article 1737 Portuguese Civil Code- Rights of heirs of property do not extinguish upon death: The Court heard an appeal against a judgment passed by the Bombay High Court regarding inventory proceedings under Chapter XVII by Articles 1369 to 1447 of the Portuguese Civil Procedure Code.
Upholding the judgment of the High Court, the Court observed that Article 1737 of the Code is cast in wide terms, and the rights of the heirs of property do not extinguish upon their death.
Cause Title – Mrs. Ethel Lourdes D'Souza Lobo v. Lucio Neville Jude De Souza & Ors.
Date of Judgment – September 19, 2022
Coram – Justice S. Ravindra Bhat & Justice Sudhanshu Dhulia
10) IBC- Approving resolution plan for corporate debtor does not discharge its guarantor: The Court observed that approving a resolution plan in relation to a Corporate Debtor does not discharge its guarantor under Section 7 of the Insolvency and Bankruptcy Code.
The Court also held that if there are two borrowers or if two corporate bodies fall within the ambit of corporate debtors, there is no reason why proceedings under Section 7 of IBC cannot be initiated against both the Corporate Debtors.
Cause Title – Maitreya Doshi v. Anand Rathi Global Finance Ltd. & Anr.
Date of Judgment – September 22, 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
11) Arbitral Award may be enforced under CPC where it cannot be set aside due to expiration of time u/s. 36 of Arbitration Act: The Court observed that under Section 36 of the Arbitration and Conciliation Act, where the time for making an application to set aside the arbitral award has expired, the award might be enforced in accordance with the provisions of CPC.
The Court also held that the jurisdiction of the Court under Section 9 is wide and thus observed –
"A party may apply to a Court for interim measures before the commencement of Arbitral proceedings, during Arbitral proceedings or at any time after the making of the Arbitral Award, but before it is enforced in accordance with Section 36 of the Arbitration Act."
Cause Title – Sepco Electric Power Construction Corporation v. Power Mech Projects Ltd.
Date of Judgment – September 19, 2022
Coram – Justice Indira Banerjee & Justice Krishna Murari
12) SEBI Regulations- Likelihood of unpublished price sensitive information materially affecting price of securities must be analysed: The Court upheld the order of the Securities Appellate Tribunal, and observed that "while dealing with a case falling under Explanation (vii) of Regulation 2(ha), one may have to see whether there was any likelihood of the said information materially affecting the price of the securities of the company."
Considering that the Respondent did not wait for information about the market trend after the information became public, the Supreme Court held that the Respondent had no motive or intention to make undeserved gains by encashing on the unpublished price-sensitive information that he possessed.
Cause Title – Securities And Exchange Board Of India v. Abhijit Rajan
Date of Judgment – September 19, 2022
Coram – Justice Indira Banerjee & Justice V. Ramasubramanian
13) Administrative or Executive orders cannot be made applicable retrospectively in absence of legislative competence: The Court observed that administrative/executive orders or circulars in the absence of any legislative competence cannot be made applicable retrospectively. The Court further held that the law could be made retrospectively if it was expressly provided by the Legislature in the Statute.
The Court made this observation while dealing with a batch of appeals assailing the judgment passed by the Telecom Disputes Settlement and Appellate Tribunal, New Delhi, followed with the order rejecting the application seeking clarification of aforesaid judgment to the extent that the rate of infrastructure charges for Active Links of Licensed Telecom Service Providers to be charged in terms of the circular dated June 12, 2012 has been made effective from April 1, 2013 instead of April 1, 2009.
Cause Title – Bharat Sanchar Nigam Ltd. and Others etc. v. M/S Tata Communications Ltd. etc.
Date of Judgment – September 22, 2022
Coram – Justice Ajay Rastogi & Justice BV Nagarathna
14) Retrospective environmental clearance can be granted in exceptional circumstances- Supreme Court reiterates: The Court reiterated that he Environment Protection Act does not prohibit ex post facto environmental clearance and it can be granted in exceptional circumstances taking into account all relevant environmental factors.
The Bench also observed that Courts cannot be oblivious to the economy or the need to protect the livelihood of hundreds of employees and others employed in the units and dependent on the units for their survival.
Cause Title – D. Swamy v. Karnataka State Pollution Control Board & Ors.
Date of Judgment – September 22, 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
15) Unregistered agreement to sell shall not be admissible in evidence- SC in suit for permanent injunction: In a suit for permanent injunction, the Court observed that an unregistered document or an agreement to sell shall not be admissible in evidence.
The Bench while holding so, held, "The plaintiff clverly prayed for a relief of permanent injunction only and did not seek for the substantive relief of specific performance of the agreement to sell as the agreement to sell was an unregistered document and therefore on such unregistered document/agreement to sell, no decree for specific performance could have been passed."
Cause Title – Balram Singh v. Kelo Devi
Date of Judgment – September 23, 2022
Coram – Justice MR Shah & Justice Krishna Murari
16) A decree can only be executed in respect of suit property if such property is easily identifiable: The Court held, ""There could be no doubt that a decree should not to the extent practicable be allowed to be defeated. At the same time, a decree can only be executed in respect of the suit property if the suit property is easily identifiable. The extent of the suit property would have to be determined by the Executing Court, as a question relating to execution, discharge or satisfaction of the decree."
The Court made this observation while dealing with an appeal filed by Appellant-Hindustan Petroleum Corporation Ltd challenging the Order passed by the Delhi High Court dismissing the Execution First Appeals filed by the Appellant.
Cause Title – Hindustan Petroleum Corporation Ltd. v. Ajay Bhatia with Anr.
Date of Judgment – September 22, 2022
Coram – Justice Indira Banerjee & Justice AS Bopanna
17) IBC- There is no bar to withdraw application admitted u/s. 7 IBC before committee of creditors is constituted: The Court observed that before the Committee of Creditors (CoC) is constituted, there is no bar to withdrawing the application of the applicant admitted under Section 7 of the Insolvency and Bankruptcy Code for initiating the corporate insolvency resolution process (CIRP).
The Bench added that the settlement cannot be stifled before the Constitution of Creditors in anticipation of claims against the Corporate Debtor from third persons and thus observed –
"The withdrawal of an application for CIRP by the applicant would not prevent any other financial creditor from taking recourse to a proceeding under IBC. The urgency to abide by the timelines for completion of the resolution process is not a reason to stifle the settlement."
Cause Title – Ashok G. Rajani v. Beacon Trusteeship Ltd. & Ors.
Date of Judgment – September 22, 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
18) Prior anchorage charges levied upon vessel under sale is not in nature of encumbrances for purpose of anchorage fee: While adjudicating upon a case falling under the Port Trusts Act 1963, the Supreme Court has observed that levying prior anchorage charges upon vessel under sale are not in the nature of encumbrances for the purpose of anchorage fee.
The Bench dismissed the appeal of the Appellant and upheld the impugned judgment of the Division Bench of the Bombay High Court which had held that it is far-fetched to suggest that prior anchorage was of the Vessel under sale and the rate that it attracts as a result of such prior anchorage are in the nature of encumbrances for the purposes of anchorage fees to be applied after the date of Bill of Sale and till the Vessel sells at the instance of the purchaser.
Cause Title – M/s. NKD Maritime Limited v. The Board of Trustees of the Port of Mumbai & Ors.
Date of Judgment – September 22., 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
19) Genuineness of denial of title cannot be based on assumptions ignoring validly registered document: The Court observed that in respect of sale of an immoveable property, the genuineness of the denial of title cannot be decided based on presumptions and oral assertations ignoring a valid registered document.
The Court held that the concurrent findings of the Courts below on the issue that the title of the respondent was malafidely denied by the appellants is the rightful conclusion on appreciation of the facts and evidence obtained in this case and is not infected with perversity.
Cause Title – Gopi @ Goverdhannath (d) by LRs. & Ors. v. Sri Ballabh Vyas
Date of Judgment – September 22, 2022
Coram – Justice Indira Banerjee & Justice CT Ravikumar
20) Representation invalidly rejected: SC upholds HC's order directing to reassess suitability of employee for grant of SAG: In a service matter, the Court upheld the Rajasthan High Court's order directing the Department to reassess the suitability of the Respondent for the purpose of grant of Senior Administrative Grade (SAG).
The Union of India had preferred an appeal before the Apex Court challenging the judgment of the High Court which had upheld the order of CAT which had set aside the rejection of the representation of the Respondent and directed the case for review and reconsider him.
Cause Title – Union of India & Ors. v. G.R. Meghwal
Date of Judgment – September 23, 2022
Coram – Justice MR Shah & Justice BV Nagarathna
21) Order for addition of party under Order 1 Rule 10(2) of CPC is not appealable in admiralty suit u/s. 14 of Admiralty Act: The Court observed that an order for addition of a party under Order 1 Rule 10(2) of the Code of Civil Procedure is not appealable under section 14 of the Admiralty Act.
The Court observed that when two or more enactments operating in the same field contain a non obstante clause stating that its provisions will have effect notwithstanding anything inconsistent therewith contained in any other law, the conflict has to be resolved upon consideration of the purpose and policy underlying the enactments.
Cause Title – Owners and Parties Interested in the Vessel M.V. Polaris Galaxy v. Banque Cantonale De Geneve
Date of Judgment – September 23, 2022
Coram – Justice Indira Banerjee & Justice AS Bopanna
22) Supreme Court Sets Aside Bail Granted To Murder Accused On The Grounds Of Parity: The Court set aside the bail order of a murder accused who was granted bail essentially on the consideration that identically placed co-accused persons were already granted bail.
The Court noted, "…when the bail granted to co-accused person has been disapproved by this Court and such grant of bail to co-accused had been the only reason for which the bail was granted to the respondent No. 2, the impugned order is liable to be set aside."
Cause Title – Aminuddin v. State of Uttar Pradesh & Anr.
Date of Judgment – September 23, 2022
Coram – Justice Dinesh Maheshwari & Justice Krishna Murari
23) SC directs Greater Mohali Area Development Authority to deposit enhanced compensation payable to landowners within 3 months: The Court directed the Greater Mohali Area Development Authority to deposit the enhanced compensation amount payable to landowners within 3 months.
The Bench was adjudicating upon a batch of appeals filed by landowners challenging the determination of compensation at Rs. 19,85,700/- per acre in respective first appeals, except RFA No. 1614 of 2000. In RFA No.1614 of 2000, the High Court has awarded the compensation at the rate of Rs. 7,80,000/- per acre.
Cause Title – Harpal Singh and Anr. Etc. Etc. v. State of Punjab Etc. Etc. with Ors.
Date of Judgment – September 23, 2022
Coram – Justice MR Shah & Justice Krishna Murari
24) Section 100 CPC: Second Appeal can be entertained only on an unsettled question of law- SC reiterates: The Court set aside an order passed by the Bombay High Court as it found that no substantial question of law had been involved in the second appeal.
The Court held, ""To be 'substantial', a question of law must be debatable, not previously settled by law of the land or a binding precedent, and must have a material bearing on the decision of the case, if answered either way, insofar as the rights of the parties before it are concerned. To be a question of law "involving in the case" there must be first, a foundation for it laid in the pleadings and the question should emerge from the sustainable findings of fact arrived at by court of facts and it must be necessary to decide that question of law for a just and proper decision of the case. An entirely new point raised for the first time before the High Court is not a question involved in the case unless it goes to the root of the matter. It will, therefore, depend on the facts and circumstance of each case whether a question of law is a substantial one and involved in the case or not, the paramount overall consideration being the need for striking a judicious balance between the indispensable obligation to do justice at all stages and impelling necessity of avoiding prolongation in the life of any lis."
Cause Title – Chandrabhan (Deceased) Through Lrs. & Ors. v. Saraswati & Ors.
Date of Judgment – September 22, 2022
Coram – Justice Indira Banerjee & Justice JK Maheshwari
25) Fraud vitiates everything- Supreme Court while affirming that forged DEPB licenses are void ab initio: The Court affirmed an order passed by the Punjab and Haryana High Court by which the High Court had dismissed an appeal filed by the Appellant under Section 130 of the Customs Act.
In that context, the Court held that "In that view of the matter and on the principle that fraud vitiates everything and such forged/fake DEPB licenses/Scripps are void ab initio, it cannot be said that the Department acted illegally in invoking the extended period of limitation. In the facts and circumstances, the Department was absolutely justified in invoking the extended period of limitation."
Cause Title – M/s. Munjal Showa Ltd. & Ors. v. Commissioner of Customs and Central Excise (Delhi - IV) & Ors.
Date of Judgment – September 23, 2022
Coram – Justice MR Shah & Justice Krishna Murari
26) Order of dismissal set aside on ground of breach of principle of natural justice- SC remits case to disciplinary authority: The Court heard an appeal against an order passed by the High Court of Madras.
Allowing the appeal in part, the Court held that "as the order of dismissal has been set aside on the ground that the same was in breach of principles of Natural Justice, the High Court ought to have remitted the case concerned to the Disciplinary Authority to conduct the inquiry from the point that it stood vitiated and to conclude the same after furnishing a copy of the Inquiry Report to the delinquent and to give opportunity to the delinquent to submit his comments on the Inquiry Officer's Report."
Cause Title – The Inspector of Panchayats and District Collector. Salem v. S. Arichandran & Ors.
Date of Judgment – September 23, 2022
Coram – Justice MR Shah & Justice Krishna Murari
27) Supreme Court Orders Reinstatement Of Watchman Who Was Wrongfully Terminated 20 Years Ago: The Court ordered the reinstatement of a watchman who was wrongfully terminated twenty years ago.
The Court heard an appeal against an order passed by the Gujrat High Court. Quashing the order, the Court observed, "...the direction to substitute the relief of reinstatement with one for lumpsum payment was not warranted in the circumstances of this case."
Cause Title – Jeetubha Khansangji Jadeja v. Kutchh District Panchayat
Date of Judgment – September 23, 2022
Coram – CJI UU Lalit & Justice S. Ravindra Bhat
28) No provision to issue directions for refund of tax prior to insertion of Section 22(1B) to the Central Sales Tax Act- The Court heard an appeal against an order passed by the Central Sales Tax Appellate Authority.
While disposing of the appeal, the Court held that "At this stage, it is required to be noted that prior to insertion of Section 22(1B) to the Central Sales Tax Act, 1956 (hereinafter referred to as the 'Act 1956'), there was no provision by which the Appellate Authority could have issued directions for refund of the tax collected by the State which has been held by the Appellate Authority to be not due to that State, or alternatively, direct that State to transfer the refundable amount to the State to which central sales tax is due on the same transaction."
Cause Title – Tata Motors Limited v. Central Sales Tax Appellate Authority & Others
Date of Judgment – September 21, 2022
Coram – Justice MR Shah & Justice Krishna Murari
29) Failure to produce accused physically or virtually before court while extending his judicial custody is gross illegality: The Court held that it is a mandatory requirement to procure the presence of the accused either physically or virtually while extending his remand to judicial custody.
The Bench further observed, "The failure to procure the presence of the accused either physically or virtually before the Court and the failure to inform him that the application made by the Public Prosecutor for the extension of time is being considered, is not a mere procedural irregularity. It is gross il legality that violates the rights of the accused under Article 21."
Cause Title – Jigar @ Jimmy Pravinchandra Adatiya v. State of Gujarat with Ors.
Date of Judgment – September 23, 2022
Coram – Justice Ajay Rastogi & Justice Abhay S. Oka