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Digital Supreme Court Reports

The Official Law Report
Fortnightly

2025 | Volume 1 | Part 2

Citation Style: [ Year ] Volume No. S.C.R. Page no.

Digitally Published by
Supreme Court of India
Digital Supreme Court Reports
The Official Law Report
Fortnightly
2025 | Volume 1 | Part 2

Digitally Published by
Supreme Court of India
 Editorial Board
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 Contents

1. The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.. . . . . . . . . . . . . . . . 313

2. Om Prakash @ Israel @ Raju @ Raju Das v.

Union of India and Another . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362

3. State of Uttar Pradesh and Another v.

R.K. Pandey and Another. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 403

4. Dr. Sharmad v. State of Kerala and Others. . . . . . . . . . . . . . . . . . . 414

5. Principal Commissioner of Income Tax-4 & Anr. v.

M/s Jupiter Capital Pvt. Ltd.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431

6. Sanjay Dutt & Ors. v. The State of Haryana & Anr.. . . . . . . . . . . . . 446

7. Rina Kumari @ Rina Devi @ Reena v.

Dinesh Kumar Mahto @ Dinesh Kumar Mahato and another. . . . . 462

8. Ram Pyarey v. The State of Uttar Pradesh. . . . . . . . . . . . . . . . . . . 484

9. Dharmendra Kumar Singh & Ors. v.

The Hon’ble High Court of Jharkhand & Ors.. . . . . . . . . . . . . . . . . 490

10. Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498

11. Geetha V.M. & Ors. v. Rethnasenan K. & Ors.. . . . . . . . . . . . . . . . 515

12. Indian Evangelical Lutheran Church Trust Association v.

Sri Bala & Co.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 542

13. Chief Revenue Controlling Officer Cum Inspector General of

Registration, & Ors. v. P. Babu. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 576

14. Sadashiv Dhondiram Patil v. The State of Maharashtra. . . . . . . . . 592

15. NBCC (India) Ltd. v. The State of West Bengal & Ors.. . . . . . . . . . 610
 [2025] 1 S.C.R. 313 : 2025 INSC 36

The Municipal Corporation of Greater Mumbai & Ors.

v.
Century Textiles and Industries Limited & Ors.
(Civil Appeal No. 6667 of 2023)
07 January 2025
[Vikram Nath* and Prasanna B. Varale, JJ.]

Issue for Consideration

Issue arose whether the appellant-Corporation was bound to
convey the lease in favour of the respondent in terms of s.51 of
the Bombay Improvement Trust Transfer Act, 1925; and whether
writ petition filed before the High Court sufferred from delays and
laches and was liable to be dismissed as the cause of action had
arisen in 1955 whereas the writ petition was filed in 2016 after a
delay of 61 (sixty-one) years.

Headnotes†
Bombay Improvement Trust Transfer Act, 1925 – ss.48, 51 –
Mumbai Municipal Corporation Act, 1888 – s.527 – City of the
Bombay Improvement Act, 1898 – s.32B – Poorer Classes
Accommodation Scheme-PCAS – Default and determination
of lease – Execution of conveyance – In 1918, PCAS approved
for respondent no. 1 which provided for construction of 44
Blocks of poorer class dwellings containing a total of 980
rooms and 20 shops as a pre-condition for execution lease
u/s.32G – Scheme duly notified – Respondent no. 1 constructed
476 dwellings and 10 shops till 1925, as a part of the
pre-condition for execution of lease – 1898 Act repealed by
the Act of 1925 – Respondent no.1 applied to the Improvement
Trust under the 1925 Act for alteration of the notified Scheme
and the same was granted – According to the resolution,
Block-B and Block-C was to be excluded – Block-B was
conveyed to the respondent no.1 – Lease of Block-A for a
period of 28 years granted to the company, which was to expire
in 1955 – For 51 years, neither the appellant nor respondent
no.1 initiated any proceedings against each other – In 2006,
respondent No.1 served notice u/s.527 of the 1888 Act on the

* Author
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appellant that after expiry of lease period of 28 years, the said

property ought to be conveyed to the respondent No.1 and,
on failure to do so the respondent No.1 would be constrained
to file a suit – However, no suit ever filed – Respondent no.1
requested to execute formal deed of conveyance in 2014 and
2016, however, no action taken – Respondent No.1 then filed
writ petition in 2016 – High Court allowed the same directing
the appellant to execute formal conveyance of plot in favour
of the respondent No.1 – Sustainability:
Held : Not sustainable – Terms and conditions of the lease
agreement reveal no stipulation that on the expiry of the lease,
after completion of 28 years, the appellants would be bound to
convey the said land to respondent no.1 – Neither the Board
Resolution nor the lease deed and neither the statutory framework
in force imposed any obligation upon the appellant to execute
a conveyance in favour of the respondent no.1 – High Court
misinterpreted the same to be a condition incorporated in the lease
deed for conveyance, on expiration of 28 years – Harmonious
and contextual interpretation of ss.48(a) and 51(2) of the 1925
Act, as well as the clear absence of any covenant to that effect
in the lease deed, unequivocally demonstrates that no vested
right to conveyance arose on the expiration of the lease – Rather
than insisting that “shall convey” in s.51(2) invariably means an
unconditional obligation, it is more appropriate to understand that it
calls for conveyance only where the arrangement and compliance
align with the statutory prerequisites – Absent any express statutory
mandate or contractual stipulation, the claim for compulsory
conveyance at the end of the lease term must fail – Respondent
no.1 failed to take any active step in furtherance of getting such
a conveyance executed at the end of the lease term – Thus, the
appellants neither bound nor were under any legal obligations to
convey the premises to the respondent no.1 – As regards delay
and laches, no merit in the conduct of the respondent no. 1 where
it deliberately chose to sit still on its rights for a long period of
fifty-one years – Writ petition filed before the High Court in 2016
clearly a route adopted to subvert the long delay of sixty-one
years which cannot be condonable – View taken by the High
Court in treating the petition to be not suffering from any delay
and laches cannot be sustained – Furthermore, the preamble
to the 1925 Act states that enactment was for constructing new
[2025] 1 S.C.R.  315

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

sanitary dwellings for certain classes of the inhabitants of the city

to secure tangible benefits for the poorer sections of society –
Lease deed did not confer any rights to convert the usage of the
lands for commercial purposes – Land allocated under a special
scheme, on “poorer classes” accommodation, when sought to be
commercially exploited, represents a direct affront to the spirit of
the enactment – Such conduct amounts to abuse of beneficial
legislation – Public trust reposed in the private entity to serve a
greater good is thus betrayed – This not only harms the class
of beneficiaries whom the legislation and agreement designed
to protect and imperils the broader public interest – Impugned
judgment of the High Court set aside [Paras 36, 37, 38, 44,
53-55, 58, 63, 64-69, 70].

Bombay Improvement Trust Transfer Act, 1925 – ss.48 and 51 –

s.48 providing the general conditions of the lease given under
the Poorer Classes Accommodation Scheme-PCAS placing
restrictions on the lessee as to how it would use and how the
rent etc. would be determined for letting out the tenements,
whereas s.51 provides for default, and determination of the
lease – Interpretation of ss.48 and 51:
Held : s.48(a) and s.51(2) must be read harmoniously so that
the duty to restore the premises at the end of the lease remains
intact, unless a clear contrary intention emerges, and the right
to conveyance u/s.51(2) thereof is recognized as contingent, not
automatic – Such a reading is consistent with the accepted principle
that statutory provision should not be construed in a manner that
would reduce another provision to a “dead letter – By employing
a harmonious construction, the 1925 Act’s provisions are allowed
to complement rather than contradict one another – This approach
upholds the integrity of the legislative scheme, ensures that none
of its components are undermined, and maintains a balance
between the obligations imposed on a lessee and any rights that
may accrue at the end of the lease’s tenure – If there is default,
then u/s.51(1), the Board has a right to re-enter upon the demised
premises whereas under sub-Section (2) thereof provides that
where no default is made, the Board shall convey the premise to
the lessee at his cost – It is neither necessary nor desirable to
treat s.51(2) as an absolute mandate that would override or negate
s.48(a) thereof – Interplay between ss.48(a) and 51(2) is resolved
316 [2025] 1 S.C.R.

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through a construction that acknowledges the necessity of leaving

the premises in good condition at the expiration of lease, while
recognizing that conveyance can be contemplated only where
such a course is unequivocally aligned with the lease terms and
the statutory framework as a whole – This reconciliation preserves
the intention of the legislature, avoids destructive interpretations,
and provides coherent, just, and practical reading of the statute.
[Paras 46-52]

Interpretation of statutes – Principles of statutory interpretation –

Explanation:
Held : Principles of statutory interpretation demand that no provision
of a statute should be rendered nugatory or superfluous – Statute
must be construed as a coherent whole, ensuring that each part
has meaningful content and that the legislative scheme remains
workable – Where two provisions appear to be in tension, a
construction that reconciles them is to be allowed, allowing both
to operate and giving effect to the underlying legislative intent.
[Para 48]

Case Law Cited

Shri Vallabh Glass Works Ltd. v. Union of India [1984] 3 SCR
180 : (1984) 3 SCC 362; CIT v. Hindustan Bulk Carriers [2002]
Supp. 5 SCR 387 : (2003) 3 SCC 57; Aflatoon v. Lt. Governor
of Delhi [1975] 1 SCR 802 : (1975) 4 SCC 285; SS Rathore
v. State of MP [1989] Supp. 1 SCR 43 : (1989) 4 SCC 582;
Sainik Motors v. State of Rajasthan [1962] 1 SCR 517; Sultana
Begum v. Prem Chand Jain [1996] Supp. 9 SCR 707 : (1997)
1 SCC 373 : AIR 1997 SC 1006; Lachoo Mal v. Radhey Shyam
[1971] 3 SCR 693 : (1971) 1 SCC 619; Sita Ram Gupta v.
Punjab National Bank [2008] 4 SCR 636 : (2008) 5 SCC 711; HR
Basavaraj v. Canara Bank [2009] 15 SCR 504 : (2010) 12 SCC
458; Murlidhar Agarwal and Anr. v State of Uttar Pradesh and
Others [1975] 1 SCR 575 : (1974) 2 SCC 472; Devkaran Nenshi
Tanna v. Manharlal Nenshi [1994] Supp. 1 SCR 679 : (1994) 5
SCC 681; PTC (India) Financial Services Ltd. v. Venkateswarlu
Kari [2022] 9 SCR 1063 : (2022) 9 SCC 704; Managing Director
Chattisgarh State Co-Operative Bank Maryadit v. Zila Sahkari
Kendriya Bank Maryadit and Ors. [2020] 5 SCR 307 : (2020)
6 SCC 411; J.K. Spinning and Weaving Mill Co Ltd. v. State of
[2025] 1 S.C.R.  317

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

Uttar Pradesh & Others [1961] 3 SCR 185 : SCC Online SC 16;
Rameshwar and Others v. Jot Ram and Another [1976] 1 SCR
847 : (1976) 1 SCC 194; State of Maharashtra vs. Digambar
[1995] Supp. 1 SCR 492 : (1995) 4 SCC 683; Hari Singh v.
State of U.P. (1984) 2 SCC 624; Municipal Corporation of Greater
Bombay v. Industrial Development Investment Co. (P) Ltd. [1996]
Supp. 5 SCR 551 : (1996) 11 SCC 501; New Okhla Industrial
Development Authority v. Harkishan [2017] 1 SCR 572 : (2017)
3 SCC 588 – referred to.

List of Acts
Companies Act, 2013; City of Bombay Improvement Act, 1898;
Bombay Improvement Trust Transfer Act, 1925; Mumbai Municipal
Corporation Act, 1888.

List of Keywords
Conveyance of lease; Delays and laches; Harmonious and
contextual interpretation; Shall convey; Claim for compulsory
conveyance; Suit for specific performance or mandatory injunction;
Limitation; Constructing new sanitary dwellings for certain classes
of inhabitants of the city; Tangible benefits for the poorer sections of
society; Lease deed; Beneficial legislation; Public trust; Destructive
interpretations; Principles of statutory interpretation; Poorer Classes
Accommodation Scheme; Construction of poorer class dwellings;
Lease; Municipal Corporation of Greater Mumbai; Legal notice;
Harmonious Construction; Reduce any provision to dead letter;
No provision rendered nugatory; Delay of 51 years; Delay of 61
years; Delay not condonable; Writ petition to escape limitation;
Public welfare; Abuse of beneficial legislation.

Case Arising From

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6667 of 2023
From the Judgment and Order dated 14.03.2022 of the High Court
of Judicature at Bombay in WP No. 295 of 2017

Appearances for Parties

Neeraj Kishan Kaul, Dhruv Mehta, Darius J. Khambatta, Shyam
Divan, Ranjit Kumar, Sr. Advs., Ashish Wad, Manoj Wad, Mrs.
Tamali Wad, Siddharth Dharmadhikari, Sandeep Mohan Patil, Ajeyo
318 [2025] 1 S.C.R.

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Sharma, Ms. Akriti Arya, Keith Verghese, Ms. Ira Mahajan, M/s. J
S Wad And Co, Ms. Nina R. Nariman, J. N. Mistry, Ms. Namrata
Parikh, Aditya Panda, Sudipto Sardar, Saswat Pattnaik, Aniruddha
Deshmukh, Aaditya Aniruddha Pande, Bharat Bagla, Sourav Singh,
Aditya Krishna, Ms. Preet S. Phanse, Adarsh Dubey, Advs. for the
appearing parties.

Judgment / Order of the Supreme Court

Judgment

Vikram Nath, J.

1. The Municipal Corporation of Greater Mumbai1 and its officers have

filed this appeal assailing the correctness of judgment and order
dated 14.03.2022 passed by the Bombay High Court allowing the Writ
Petition No. 295 of 2017 filed by the Respondent No.1 directing the
appellant (Respondent No.1 therein) to execute formal conveyance
of plot bearing C.S. No.1546 of Lower Parel Division, Mumbai in
favour of the Respondent No.1 (Petitioner no.1 therein) within a
period of eight weeks.
2. Brief facts giving rise to the present appeal are summarised hereunder:
2.1. Century Textiles and Industries Limited (Respondent No.1) is
a company incorporated under the Companies Act running
a cotton mill. Under the provisions of the City of Bombay
Improvement Act, 1898,2 Respondent No.1 applied to the
Improvement Trust under Section 32B thereof under the
Poorer Classes Accommodation Scheme (in short, “PCAS”)
to provide dwellings to the poorer class workers. The said
application was filed on 12.04.1918.
2.2. The Improvement Trust Board, vide Resolution no. 121, in
its meeting dated 16.04.1918, approved the PCAS of the
Respondent No.1 which provided for construction of 44
Blocks of poorer class dwellings containing a total of 980
rooms and 20 shops as a pre-condition for execution of
the lease under Section 32G of the 1898 Act (as amended
in 1913), with other consequences to follow.

1 MCGM
2 The 1898 Act
[2025] 1 S.C.R.  319

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

2.3. It would be worthwhile to mention here that the construction

was to take place on a piece of land measuring 50,000
sq. yds. sub-divided into three plots A, B and C. However,
at present, the dispute relates only to plot A admeasuring
23,000 sq. yds.
2.4. The above scheme, as approved by the Board, was duly
notified on 01.05.1918 as Scheme No. 51. The Special
Collector handed over the charge of the property/plot bearing
C.S. No. 1546 of Lower Parel Division to the Improvement
Trust, pursuant to the aforesaid Resolution No. 121 and
the notification of Scheme No. 51, sometime in August,
1919. The possession of the said plot was, later on, handed
over by the Improvement Trust to the Respondent No.1,
whereupon, they started the construction and constructed
476 dwellings and 10 shops till the year 1925, as a part
of the pre-condition for execution of lease under Section
32G of the 1898 Act.
2.5. In the year 1925, the 1898 Act was repealed by The Bombay
Improvement Trust Transfer Act, 1925.3 On 10.03.1927,
Respondent No.1 applied to the Improvement Trust under
Section 37(2) of the 1925 Act for alteration of the notified
Scheme No. 51. Again, on 20.05.1927, Respondent No.1,
through their solicitors M/s C.N. Wadia and Company applied
to the Improvements Committee making the same request
for modification of the notified Scheme No. 51 requesting the
committee to accept the 476 rooms instead of 980 rooms and
10 shops instead of 20 shops, as required under the notified
scheme. The Improvement Trust/Board, vide Resolution
No. 325 dated 31.05.1927, granted alteration of the notified
Scheme No. 51. According to the said resolution, Block-B
and Block-C would be excluded from Estate Agent’s plan,
lease of Block-A for a period of 28 years to be granted to
the company on the terms mentioned in paragraphs 2 and 4
of the letter dated 20.05.1927, Block-B to be conveyed to
the Respondent No.1 on terms and conditions stated in
paragraph 5 of the letter dated 20.05.1927 and Block-C to
remain the property of the Improvement Trust/Board.

3 The 1925 Act

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2.6. Pursuant to the said Resolution No. 325, Block-B was

conveyed to the Respondent No.1 on 10.01.1928 for
which the Respondent No.1 paid Rs.1,20,000/- as sale
consideration.
2.7. Later on, a lease was granted by the Board in favour of
Respondent No.1 on 03.10.1928 with respect to Block-A,
which included both the land and buildings for a period of
28 years w.e.f. 01.04.1927 at a yearly rent of Rupee One.
The lease was to expire on 31.03.1955 i.e. on completion
of 28 years. The Respondent No.1 also paid the expenses
of acquisition which had been incurred by the Board.
2.8. For a period of 51 years, neither the appellant nor the
Respondent No.1 initiated any proceedings against each
other - the Respondent No.1 for getting the conveyance
executed, as is being claimed now, and the appellant for
eviction of the Respondent No.1 as the lease period had
expired. The fact remains that the Respondent No.1 has
continued in possession of the land and buildings comprised
in Block-A.
2.9. The Respondent No.1, on 14.08.2006, served a legal notice
under Section 527 of the Mumbai Municipal Corporation
Act, 1888 4 on the appellant stating that as per the lease
agreement, after expiry of lease period of 28 years, the said
property ought to be conveyed to the Respondent No.1 and,
on failure to do so within the specified period, the Respondent
No.1 would be constrained to file a suit. However, no suit
was ever filed by the Respondent No.1.
2.10. In 2009, an application was filed by the Respondent No.1
for redevelopment of the land in question to the appellant
as, according to the Respondent No.1, they had closed the
mill in 2008 and they wanted to shift the mill industry out of
the land in question.
2.11. Another communication dated 21.04.2009 was sent by the
Respondent No.1 to the appellant, requesting for conveyance
of Block-A as per the lease deed. The MCGM apparently
approved an integrated development scheme on 17.03.2011
with respect to Block-A Plot bearing C.S. No.1546. The

4 The 1888 Act

[2025] 1 S.C.R.  321

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

Assistant Commissioner (Estate) of the appellant was of

the opinion that Block-A should not be conveyed to the
Respondent No.1 which is apparent from the internal report
dated 17.06.2013.
2.12. A meeting between the parties was held in March, 2014
after which, once again, the Respondent No.1 requested,
vide letter dated 27.03.2014, to execute a formal deed
of conveyance. The Respondent No.1, vide letter dated
30.11.2016, again called upon the appellant to execute a
formal deed of conveyance in view of Section 51(2) of the
1925 Act. When no action was taken by the appellant, the
Respondent No.1 filed writ petition before the Bombay High
Court in December, 2016 which was registered as W.P.
No. 295 of 2017. The reliefs claimed by means of the said
petition are reproduced hereunder :
“29. …The Petitioners therefore pray :
a) For a Writ of mandamus or a writ in the nature
of mandamus or for any appropriate writ, order or
direction ordering and directing Respondent Nos. 1
and 2 (and their servants, officers and agents)
to recognize and proceed on the basis that the
said Premises being plot bearing C.S.No.1546 of
Lower Parel Division and the buildings standing
thereon vest in Petitioner No. 1 by virtue of the
provisions of the Improvement Acts and as the
absolute owners thereof.
b) For a writ of mandamus or a writ in the nature
of mandamus or any other appropriate writ, order
or direction under Article 226 of the Constitution of
India ordering and directing the Respondent No.1
(and its servants, officers and agents) to do all such
acts and things as may be necessary for formalizing
the vesting of the said Premises in Petitioner
No.1 herein including by executing and thereafter
registering with the Sub Registrar of Assurances a
Deed of Conveyance of the said Premises.
c) For a writ of mandamus or a writ in the nature
of mandamus or any other appropriate writ, order
or directions under Article 226 of the Constitution
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of India ordering and directing the Respondent

No.2 (and its servants, officers and agents) to
do all such acts and things as may be necessary
for reflecting the name of Petitioner No.1 in the
records of the Collector of Mumbai in respect of
the said plot of land bearing C. S. No. 1546 of
Lower Parel Division;
d) That pending the hearing and final disposal
of this Petition this Hon’ble Court be pleased
to direct the Respondents by themselves their
servants, agents, officers and sub-ordinates to
consider all applications from Petitioner No.1 as
emanating from the owner of the said Premises
and deal with them in all matters relating to the
said Premises as if Petitioner No.1 were the
owner thereof.
e) for ad-interim reliefs in terms of prayer
(d) above;
f) for costs of this Petition; and
g) for such other and further relief as the nature
and circumstances of the case may require be
passed.”
2.13. During the pendency of the petition, the Respondent No.1
moved two amendments to the writ petition. The first one
in June, 2017, challenging the Directions note prepared
on the internal file of the appellant recommending to stop
the ongoing work and the approval granted under the
integrated scheme to be recalled and cancelled. Further
relief seeking ad interim relief against the said action
was also sought.
2.14. The appellant issued a show cause notice dated
28.03.2018 as to why the amended IDS lay out should
not exclude Block-A Plot bearing C.S. No.1546. Upon
receipt of the said notice, the Respondent No.1 moved
the second amendment to the writ petition to challenge
the said show cause notice. Under orders of the Bombay
High Court dated 12.04.2018, the appellant was directed
[2025] 1 S.C.R.  323

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

not to proceed to adjudicate on the show cause notice

until further orders.
2.15. After hearing the learned counsel for the parties and based
on material on record, the High Court by the impugned
judgment dated 14.03.2022, allowed the writ petition and
issued appropriate directions to the appellant to execute
the conveyance of the plot in question. Aggrieved by the
same, MCGM is in appeal. While issuing notice dated
13.07.2022, this Court granted an order of status quo
to be maintained by the parties. Pleadings have been
exchanged.
3. We have heard Shri Dhruv Mehta and Shri Neeraj Kishan Kaul,
learned senior counsels for the appellants; Shri Darius J. Khambatta,
Shri Ranjit Kumar and Shri Shyam Divan, learned senior counsels
appearing for the respondents and, also perused the material on
record.
4. The submissions of the learned counsels appearing for the appellants
are briefly summarized hereunder :

A. Delay and Laches in filing the Writ Petition

5. The term of the lease dated 03.10.1928 in favour of the Respondent
No.1 expired on 31.03.1955. According to the Respondent No.1, it
was purportedly entitled to a deed of conveyance on expiry of the
aforesaid period. As such, the cause of action would arise immediately
after the expiry of the term of the lease. Respondent No.1 took no
legal action before any court of law, right from 1955 till the end of
2016 i.e. for 61 years when it filed the writ petition before the High
Court on 23.12.2016. Thus, it was submitted that the petition was
highly barred by laches and ought to have been dismissed on such
grounds.
6. It was also submitted that in 2006, a legal notice dated 14.08.2006
under Section 527 of the 1888 Act was issued by Respondent No.1,
requiring the appellant to execute the conveyance deed. The limitation
provided for filing a suit under Section 527 of the 1888 Act is six
months. But Respondent No.1 took no action thereafter for more than
10 years. No suit was ever filed by the Respondent No.1. Knowing
fully well that the limitation under Section 527 of the 1888 Act had
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expired long back, they chose to file the writ petition in December,
2016. The submission is that preferring a writ petition could not do
away with the issue of limitation which would arise while availing
the statutory remedies available. In such circumstances, the High
Court fell in error in entertaining the writ petition and holding that the
filing of the writ petition even after 61 years would not suffer from
delay or laches. In support of the said submissions, the following
two judgments are relied upon :
i) Shri Vallabh Glass Works Ltd. v. Union of India,5
ii) SS Rathore v. State of MP 6

B. Effect of Section 51(2) read with Section 48 of the 1925

Act thereof
7. Section 51(2) which talks about default and determination of lease
uses the expression “shall convey” that in a situation where there is
no default in complying with the obligations under the lease document,
the Board shall convey the premises in favour of lessee on expiration
of the lease. Whereas, Section 48(a) states that the lessee would keep
the demised premises together with its fixtures in good and substantial
repair and condition during the term of the lease and leave at the
end thereof. The submission is that while reading both the provisions
together and in order to give a harmonious construction, the expression
“shall convey” must be read as “may convey”. It is also submitted that
in case Section 51(2) is read with the expression “shall convey”, then
the expression used in Section 48(a) that the lessee would leave at the
end of the term of the lease, would have no meaning and would be
rendered as otiose or superfluous. In support of the said submissions,
the following decisions are relied upon by the appellants :
i) CIT v Hindustan Bulk Carriers,7
ii) Sultana Begum v. Prem Chand Jain,8
iii) Sainik Motors v. State of Rajasthan 9

5 [1984] 3 SCR 180 : (1984) 3 SCC 362

6 [1989] Supp. 1 SCR 43 : (1989) 4 SCC 582
7 [2002] Supp. 5 SCR 387 : (2003) 3 SCC 57
8 [1996] Supp. 9 SCR 707 : (1997) 1 SCC 373
9 [1962] 1 SCR 517 : (1962) 1 SCR 517
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Century Textiles and Industries Limited & Ors.

C. Concept of contracting out of the obligations and waiving

of the statutory rights by either of the parties to a contract.
8. Highlighting the concept of contracting out of obligations arising out
of a contract and waiving the statutory rights, it has been submitted
that by now, it is well-settled that the party can legally do so and
such principle has been duly recognised by this Court in the following
decisions:
i) Lachoo Mal vs. Radhey Shyam10
ii) Sita Ram Gupta v. Punjab National Bank11
iii) HR Basavaraj v. Canara Bank12
The appellants would be entitled to the benefit of said concept in
the facts and circumstances of the case.

D. Misreading by the High Court

9. According to the appellant, the High Court committed serious
error by misreading some of the relevant documents and reading
something which is not stated in such documents. Details of the
same would be discussed while analysing the said arguments.
However, in particular, we may note that the pleadings have referred
to the Resolution of the Board dated 31.05.1927 as having been
misread and secondly the lease deed dated 03.10.1928 as also
having been misread.

E. Relevancy of the internal notings and communications

inter se officers of the Corporations
10. The submission is that until and unless the order is approved by the
Competent Authority of the Corporation and issued by its Authorised
Officer, Respondent No.1 could not derive any advantage of any
internal noting or communications of the Corporation. The High
Court committed error in relying upon such noting and internal
communications without there being a decision of the Competent
Authority duly communicated to the parties. In support of the said

10 [1971] 3 SCR 693 : (1971) 1 SCC 619

11 [2008] 4 SCR 636 : (2008) 5 SCC 711
12 [2009] 15 SCR 504 : (2010) 12 SCC 458
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submissions, reliance is placed upon the judgment in the case of

Shanti Sports Club vs. Union of India.13

F. No legal rights accrued to the Respondent No.1 for vesting

of lease/conveyance of Block-A in terms of the 1925 Act
11. The 1925 Act replaced the 1898 Act, which stood repealed.
Referring to the Section 32I(2) of the 1898 Act which stood
replaced by Section 51 of the 1925 Act, it was argued that under
the 1898 Act, it was mentioned that where no default is made in
the conditions of the lease, then on determination of the lease, all
the right, title, and interest of the Board shall vest in the employer
free from all liabilities. Whereas, under Section 51 of the 1925 Act,
under sub-Section (1) on default being made, the Board had the
right to re-enter, and under sub-Section (2), where no default is
made, then on determination of the lease, the Board shall convey
the premises to the lessee at his cost and free of all restrictions
and liabilities imposed under the lease. It was, thus, submitted
that under the 1925 Act, there was no automatic vesting but a
separate deed of conveyance to be executed at the cost of the
lessee. This is the provision where the submission that the word
“shall convey” may be read as “may convey” read with Section 48(a)
of the 1925 Act. It was also submitted that the word used “at his
cost” in Section 51(2) clearly meant that for a conveyance by the
Board, the lessee would be required to make a separate payment
for such a conveyance.

G. Payment of cost of Scheme does not entitle Respondents

to any rights in the land itself.
12. The claim of the Respondent No.1 that it had incurred huge
expenditure as cost of the Scheme at the time of acquisition of the
land by the Board entitled it to a conveyance without any further
payment of cost of the land, is misplaced. The benefits admissible
to the Respondent No.1 under the lease deed were in return of the
bearing of the cost of the Scheme. It only envisaged a lease for 28
years, subject to terms and conditions recorded thereunder, but no
conveyance. For conveyance, separate costs were required to be

13 [2009] 13 SCR 710 : (2009) 15 SCC 705

[2025] 1 S.C.R.  327

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Century Textiles and Industries Limited & Ors.

paid at the time of conveyance as per the scheme of the 1925 Act.
It was submitted that the Respondent No.1 filed writ petition only
to make huge profits under the public welfare scheme by usurping
land valued at around Rs. 1200 crores without paying a penny.
13. On such submissions, it was prayed that the appeal be allowed, the
impugned judgement of the High Court be set aside and the writ
petition be dismissed.
14. On the other hand, the learned senior counsels for the Respondent
No.1 prayed for dismissal of the appeal by making the following
submissions:

A. The lease confers the right to conveyance on Respondent

No.1
15. It is submitted that as the lease deed dated 03.10.1928 stated that the
Board agreed to alter Scheme No.51 ‘pursuant to the lessee’s request’,
as such, the lessee’s request which contained the following expression
‘convey to the lessees the said portion of land at the expiration of the
said term’, clearly indicates that the appellant was obliged to execute
the conveyance on expiration of the lease. Even if no specific mention
of the conveyance is mentioned in the lease deed, since the appellant
agreed to alter the Scheme No. 51, they were now estopped from
denying the right of Respondent No.1 to conveyance.

B. Board Resolution No. 325 and lease cannot be used to

contract out of Section 51(2) of the 1925 Act
16. The application dated 20.05.1927 submitted by Respondent No.1
for alteration of the Scheme No.51, is reproduced in the Board
Resolution No. 325 which accepted paragraph nos. 2 and 4 thereof.
There was no occasion for the appellant today to claim that they
have contracted out of Section 51(2) of the 1925 Act. Neither the
lease deed mentioned specifically that they were contracting out of
Section 51(2) of the 1925 Act, nor at any stage thereafter have the
appellants taken this plea of contracting out.

C. Section 108(q) of the Transfer of Property Act, 1882

17. It is submitted that the appellants never raised this plea before the
High Court relying on Section 108(q) of the Transfer of Property Act,
1882 being expressly excluded in the lease deed and therefore,
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giving them the right to re-possession may not and should not be
entertained by this Court.

D. Vesting and execution of conveyance is mandatory and

cannot be contracted out
18. The submission is that the provisions of Section 51(2) of 1925 Act as
also the provisions of Section 32I(2) of the 1898 Act are mandatory
in nature as the word used is ‘shall’ and therefore, there is no
justification for the appellant to raise a plea of contracting out of the
terms of the lease or the statutory provisions. In support of the said
submission, the following judgments are relied upon:
i) Murlidhar Agarwal and Anr. v State of Uttar Pradesh and
Others14
ii) Devkaran Nenshi Tanna v. Manharlal Nenshi15
iii) PTC (India) Financial Services Ltd. v Venkateswarlu Kari16

E. Obligations of lessee/employer, recompense and composite

nature of scheme
19. Our attention has been drawn to the Scheme as spelled out in
the 1925 Act, counsels for Respondent No.1 referred to various
provisions and have submitted that once the lessee discharges all
his obligations, there is no reason why under the statutory scheme,
the land and building should not be conveyed to it. It was further
submitted that under the 1925 Act, the conveyance referred to is
akin to the vesting provided under Section 32I(2) of the 1898 Act.

F. Section 51 of the 1925 Act, a special provision prevails over

Section 48(a) of the said Act which is a general provision
20. Referring to the provision under Section 48(a) and Section 51 of
the 1925 Act, it has been vehemently argued that Section 48, being
a general provision, deals with standard conditions of the lease to
be granted under the scheme. It only postulates that at the end of
the term of the lease, the lessee shall leave the demised premises

14 [1975] 1 SCR 575 : (1974) 2 SCC 472

15 [1994] Supp. 1 SCR 679 : (1994) 5 SCC 681
16 [2022] 9 SCR 1063 : (2022) 9 SCC 704
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and their fixtures “in good and substantial repair and condition”.
It does not deal with as to what would happen during the period
of lease where there is a default or at the end of the lease where
there has been no default. It is Section 51 of the 1925 Act which
deals with the above two situations and, as such, this would be a
special provision. Relying upon the following two judgments, it was
submitted that the special provision would prevail over the general
provision and, therefore, there was no option but for the appellant
to execute the conveyance.
i) Managing Director Chattisgarh State Co-operative Bank
Maryadit v Zila Sahkari Kendriya Bank Maryadit and Ors.17
ii) J.K. Spinning and Weaving Mill Co Ltd. v State of uttar
Pradesh & Others18

G. Meaning of the word “premises”

21. Submission on behalf of the Respondent No.1 is that the word
“premises” would include both land and building, as defined in
Section 3(gg) of the 1888 Act, which clearly means that the word
“premises” would include both, buildings and land. Since the
word “premises” is not defined in the 1925 Act, Section 5 of the
1925 Act provides that the words used in the 1925 Act but not
defined therein would have the same meaning as it does under
the 1888 Act.

H. Public-Private Partnership
22. The Scheme as envisaged under the 1898 Act and the 1925 Act
was an early example of the Public-Private Partnership principle, by
which the Board was able to procure private funding for purposes
of providing housing to economically weaker section of the society
in exchange for vesting or conveying the land used for the Scheme.
The Respondent No.1 having discharged its obligations without a
single default, was entitled to the benefit of vesting/conveyance at
the end of the Scheme or the lease in the present case.

17 [2020] 5 SCR 307 : (2020) 6 SCC 411

18 [1961] 3 SCR 185 : SCC Online SC 16
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I. A vested right cannot be divested by subsequent conduct

23. The submission is that once Respondent No.1 had a right to
conveyance at the end of the term of the lease, and which was an
indefeasible right, any amount of delay, laches, or other conduct
would not result in divesting of such rights. Reliance was placed
upon the judgement in the case of Rameshwar and Others vs.
Jot Ram and Another.19

J. The appellants recognized and acknowledged the ownership

rights of Respondent No.1
24. On the above aspect, the internal correspondence and noting of the
Corporation have been referred to by the learned senior counsel at
different stages, which shall be dealt with appropriately at a later stage
by analysing the arguments raised by both the sides as to whether
such noting and internal communications within the Corporation
could be relied upon.

K. Alleged Delay
25. In trying to explain the delay for approaching the Court after 61
years, it was submitted on behalf of the Respondent No.1 that the
possession of the Respondent No.1 has continued without any
obstruction by the appellant. At no stage during this entire period of
61 years, neither did the appellant sought possession of the Block-A
nor did they demand any rent for the same. The Respondent No.1,
for the first time, came to know that the Assistant Commissioner
(Estate) of the appellant had issued an opinion in June, 2013 that
the premises should not be conveyed to Respondent No.1. However,
even that opinion was never communicated to the Respondent No.1.
The High Court has dealt with this aspect of the matter and has
found that there was no delay on part of the Respondent No.1 in
approaching the Court. Reliance has been placed on the judgment
in State of Maharashtra vs. Digambar.20
26. Before proceeding to deal with the respective submissions, it would
be appropriate to refer to the relevant statutory provisions along with

19 [1976] 1 SCR 847 : (1976)1 SCC 194

20 [1995] Supp. 1 SCR 492 : (1995) 4 SCC 683
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the scheme of those enactments. The 1898 Act was promulgated with
the preamble stating inter alia improvement and future expansion
of city of Bombay by constructing new sanitary dwellings for certain
classes of inhabitants by laying out vacant lands and by reclaiming
and laying out parts of the foreshore of the island of Bombay.
27. In the 1898 Act, a substantial amendment came in the year 1913
whereby Section 32B to Section 32I were added. This is referred to
as the Amendment Act of 1913. Under the said amended provision,
the scheme had come whereby land would be acquired by the
Board constituted under the 1898 Act and, thereafter, given out
for development and construction to private parties on such terms
and conditions as the Improvement Trust, constituted under the
1898 Act, may determine and as also spelled out in the aforesaid
provisions. Sections 32B to 32I of the 1898 Act are reproduced
hereunder:
“Section 32B. Application by employer for Poorer
Classes Accommodation Scheme : (1) Any person
employing members of the poorer classes in the course of
his business may make an application to the Board stating
that he wishes to provide poorer classes’ dwellings for
the use of all or some of such members and desiring the
Board to make a scheme for such purpose. Such person
shall hereinafter be called ‘the employer’, which term shall
include his heirs, executors, administrators, assigns and
successors.
(2) The Board on consideration of the said application, if
they are of opinion that it is expedient to provide the said
poorer classes’ dwellings, may pass a resolution to that
effect and proceed to make a scheme for that purpose.
(3) The poorer classes accommodation scheme shall
provide for –
(a) the construction of poorer classes’ dwellings
i) by the Board or
ii) by the employer under the supervision of the Board and
in accordance with plans and specifications prepared by
the Board, and
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(b) the letting on lease to the employer of the dwellings

so constructed (hereinafter called ‘the dwellings’).
(4) Such scheme may provide for all matters incidental
to the scheme, including the acquisition, raising, lowering
or levelling of land required for the execution of the
scheme and the construction of accessory dwellings of
any description that may be necessary for the purposes
of the scheme.
Section 32C – Land on which dwellings may be
constructed : The Poorer Classes accommodation
scheme may provide for the construction of the dwellings
on land: -
a) acquired by the Board or vesting in the Board either
absolutely or for sufficient number of years or
b) vesting in the employer either absolutely or for a sufficient
number of years;
Provided that the scheme shall not provide for the
construction of dwellings on land alleged to vest in the
employer until the employer has proved to the satisfaction
of the Board that he has such title to the land as shall be
good and sufficient for the purposes of the scheme.
Section 32D. Procedure on completion of scheme :
Upon the completion of a poorer classes accommodation
scheme, the provisions of sections 27, 28 and 29 shall,
with all necessary modifications, be applicable to the
scheme in the same manner as if the scheme were an
improvement scheme.
Section 32E : Procedure when dwellings are to be
constructed on Schedule C or D land : When such
scheme provides for the construction of dwellings upon
lands forming part of any of the lands specified in Schedule
C or Schedule D Government or the Corporation, as the
case may be, shall, on the scheme being sanctioned,
forthwith resume the land. The Board shall thereupon pay
in cash to Government or to the Corporation, as the case
may be, a sum equal to the market value of the land as
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determined by the Collector under the Land Acquisition

Act, 1894; and such sum shall be deemed to be part of the
cost of the scheme to the Board. The land shall thereupon
vest in the Board.
Section 32F.- Deposit and Notice : (1) The construction
of dwellings shall not be commenced: -
a) where the land vests in or is acquired by the Board, until
the employer has deposited with the Board as security a
sum equal to twenty percent of the cost of the scheme;
b) where the land vests in the employer, until the employer
has submitted to the Board a proposal that the land shall
be transferred to the Board for the purpose of Poorer
Classes Accommodation Scheme and until the board
shall have served a notice in writing upon the employer
signifying their acceptance of such proposal; provided
further that if in the opinion of the Board the value of the
land falls short of twenty percent of the estimated cost of
the scheme, the shortage shall be made good by a deposit
in cash or securities.
(2) On the service upon the employer of the notice referred
to in sub-section (1), clause (b), all the estate, right, title
and interest of the employer in and to the land referred to
in the proposal shall forthwith vest in the Board.
(3) The employer shall be entitled to the gradual refund
of his deposit by annual payments equal to the annual
Sinking Fund Charges on all moneys spent by the Board
on the scheme, which shall be calculated in the manner
described in sub-section (2) of section 32G.
Section 32G.- Term of lease and amount of rent : (1) The
Board shall proceed with the Scheme and on completion
of the building shall lease the same with the site to the
employer for 28 years.
(2) The lessee shall during the said term pay to the Board
as annual rent a sum equal to the total of –
(a) the annual interest payable by the Board on all moneys
which they have spent on the scheme, and
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(b) Sinking Fund charges so calculated that at the end of

the term of the lease the aggregate in the Sinking Fund
shall amount to the total sum spent on the scheme.
Such total sum shall include –
(i) all moneys spent on Interest and Sinking Fund Charges
up to the date of the commencement of the lease,
(ii) if and so far as the land included in the scheme has
not been provided by the employer, the cost of such land,
(iii) preliminary expenses and an allowance for management
and supervision up to the date of the commencement of
the lease.
(3) The cost of such land for the purposes of this section
shall be deemed to be –
(a) if and so far as the land has been acquired for the
scheme, the actual cost of its acquisition;
(b) if and so far as the land is vested in the Board as being
part of the lands specified in Schedule C or Schedule D,
the sum paid by the Board under section 32C;
(c) in all other cases the market value of the land at the
date of the declaration of the scheme.
Section 32H.- Provisions as to lease : (1) Every lease
under a poorer classes accommodation scheme shall
commence from such date subsequent to the completion
of the dwellings as may be fixed by the Board.
(2) The following conditions shall be expressed or implied
in every lease, namely : -
a) that the lessee shall be liable for repairs and insurance;
b) that the lessee shall be liable for the payment of all
rates and taxes;
c) that the lessee shall sub-let the dwellings (except such
portions thereof as contain shops, care-takers’ quarters and
the like) only to persons employed by him in the course
of his business or their families except in so far as there
may not be sufficient numbers of such persons willing to
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occupy the dwellings and in any case only to members

of the poorer classes;
d) that the lessee shall not demand or receive in respect of
any room or tenement in the dwellings any rent in excess
of the amount fixed as next hereinafter provided;
e) That the maximum rent of each room or tenement in
the dwellings (except such portions thereof as contain
shops and the like as hereinbefore set out) shall be fixed
by the Board after consulting the lessee and that such
maximum rent shall be written or painted up by the lessee
in a conspicuous position in each such room or tenement.
Such maximum rent shall not be subject to alteration save
with the consent of the Board.
Section 32I.- Default and determination of lease
(1)(a) On default being made by the lessee in any of the
conditions of the lease, all the right, title and interest of
the employer to the dwellings and in and to the land on
which the dwellings are constructed and any deposit or
other moneys paid by the employer to the Board whether
before or after the commencement of the lease shall be
dealt with in the following manner: -
i) The deposit by the employer shall be credited to the
Board, and
ii) The Board shall put the said right, title and interest of
the employer to the auction.
(b) The Board shall then have the option either of
transferring the right, title and interest to the highest bidder
at the auction or of themselves taking over the right, title
and interest on payment to the employer of the highest
sum bid at the auction.
(c) If no sum is bid at the auction but some person is
willing to take over the right, title and interest, on receiving
payment of any sum, the Board shall have the option either
of making such payment and transferring the right, title
and interest to that person or of themselves taking it over.
The Board shall be entitled to recover the sum in question
from the defaulting lessee for non-fulfilment of the contract.
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(d) If no sum is bid at the auction but some person is

willing to take over the right, title and interest without
either paying or receiving payment of any sum, the Board
shall have the option either of transferring the right, title
and interest to that person or of themselves taking it over
without either receipt or payment of any sum.
(2) Where no default is made in the conditions of the lease,
then on the determination of the lease all the right, title
and interest of the Board in and to the dwellings and in
and to the land on which the dwellings are constructed
shall vest in the employer free from all liabilities created
by this Act.”
28. In the meantime, the 1925 Act was promulgated which replaced the
1898 Act. Under this Act, the powers conferred upon the Board of
Trustees under the 1898 Act were to be transferred to the appellant-
Corporation and this Act further postulates that its purpose was to
improve the city of Bombay by constructing new sanitary dwellings
for certain classes. Section 48 of the 1925 Act provided for lease
conditions. Section 51 provided for dealing with the lessee where he
committed default in the terms and conditions by way of a right of
re-entry to the Corporation and further, if there is no default on the
part of lessee, it would have a right of conveyance in favour of the
lessee at his cost. Sections 48 to 51 of the 1925 Act are reproduced
hereunder :
“48. The lease shall commence from such date subsequent
to the completion of the execution of the scheme as may
be fixed by the Committee and shall be subject to the
following among other conditions: -
(a) The lessee shall keep during the term of the lease and
leave at the end thereof the demised premises together with
their fixtures in good and substantial repair and condition.
(b) The lessee shall insure the demised premises against
loss or damage by fire.
(c) The lessee shall be liable for the payment of all rates
and taxes.
(d) The lessee shall sublet the rooms and tenements
prescribed by the Committee to be used as dwellings only
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to persons employed by him in the course of his business or

their families except in so far as there may not be sufficient
numbers of such persons willing to occupy the same and
in any case only to members of the poorer classes. No
such room or tenement shall be used otherwise than as
a dwelling except with the previous consent in writing of
the Committee.
(e) The maximum rent of each room or tenement shall
be fixed by the Committee after consulting the lessee
and such maximum rent shall be written or painted up by
the lessee in a conspicuous position in each such room
or tenement. Such maximum rent shall not be subject to
alternation save with the consent of the Committee.
(f) The lessee shall not demand or receive in respect of
any such room or tenement any premium or any rent in
excess of the maximum rent fixed and in force for the
time being.
(g) The lessee shall not assign or sublet the demised
premises or any part thereof without the previous consent
in writing of the Committee. Any assignee or sub-lessee
shall be bound by the conditions contained in this Act and
in the lease.
49. Lessee may commute the rent : The lessee may at
any time with the consent of the Committee commute the
rent payable under the lease and in such event the rent
shall be Rs.1 per annum for the remainder of the term.
50. Lessee not to make alterations so as to reduce
the accommodation : The Committee shall not without
the previous sanction of the Board and of Government
permit the lessee to make any substantial variation in the
user of the premises so as to reduce the accommodation
prescribed by the Committee to be used as dwellings.
51. Default and determination of the lease:
(1) On default being made by the lessee in any of the
conditions of the lease, the Board may re-enter upon
the demised premises or any part thereof in the name
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of the whole and immediately thereupon the lease shall

absolutely determine.
(2) Where no default is made by the lessee in the conditions
of the lease, then on determination of the lease at the end
of the term thereof, the Board shall convey the premise
to the lessee at his cost and free of all restrictions and
liabilities imposed by the lease and by this Act or by the
City of Bombay Improvement Act, 1898.
29. There is another enactment by the name of Mumbai Municipal
Corporation Act, 1888. Section 527 of the said Act provided for statutory
legal notice as a pre-condition for filing a suit against the appellant
Corporation and also the limitation for filing a suit once such a notice
is given. Section 527 of the Act, 1888 is reproduced hereunder: -
“527. (1) No suit shall be instituted against the corporation
or against [the Commissioner, the General Manager] [or
the Director] or a Deputy Commissioner, or against any
municipal officer or servant, in respect of any act done
in pursuance or execution or intended execution of this
Act or in respect of any alleged neglect or default in the
execution of this Act,-
(a) Until the expiration of one month next after notice
in writing has been, in the case of the corporation, left
at the chief municipal office and, in the case of [the
Commissioner, the General Manager] [or the Director] or
of a Deputy Municipal Commissioner or of a municipal
officer or servant delivered to him or left at his office or
place of abode, stating with reasonable particularity the
cause of action and the name and place of abode of the
intending plaintiff and of his attorney or agent if any, for
the purpose of suit; nor
(b) Unless it is commenced within six months next after
the accrual of the cause of action.
(2) At the trial of any such suit –
(c) The plaintiff shall not be permitted to go into evidence
of any cause of action except such as is set forth in the
notice delivered or left by him as aforesaid;
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(d) The claim, if it be for damages shall be dismissed if

tender of sufficient amount shall have been made before
the suit was instituted or if, after the institution of the suit,
a sufficient sum of money is paid into Court with costs.
(3) When the defendant in any such suit is a municipal
officer or servant, payment of the sum or of any part
of any sum payable by him in or in consequence of
the suit whether in respect of cost, charges, expenses,
compensation for damage or otherwise, may be made, with
the [previous] sanction of the [Standing Committee or the
Brihan Mumbai Electric Supply and Transport Committee]
from the municipal fund or the [Brihan Mumbai Electric
Supply Transport Fund] as the case may be.”
30. The core issues to be considered are two:
(i) Whether the appellant-Corporation was at all bound to convey
the lease land, on completion of the terms of the lease, in favour
of the Respondent No.1 free from all restrictions and liabilities
or not. If the answer is that there was no compulsion for the
appellant either under the statute or under the terms of the
lease deed to convey, then the Respondent No.1 would have
no case at all. If the answer is positive that they were required
to convey the lease land, then the interpretation of the words
“at his cost” in Section 51(2) of the 1925 Act would be required.
(ii) The other question would be whether the writ petition filed before
the Bombay High Court suffered from delay and laches and
was liable to be dismissed on that ground alone as the cause
of action had arisen in the year 1955 whereas the writ petition
was filed in the year 2016 after a delay of 61 (sixty-one) years.
Related issue to be considered is that a Notice under Section
527 of the 1888 Act was given in the year 2006 and, thereafter,
no steps were taken for a period of ten years for filing a suit even
though the limitation prescribed was six months as per the above
provisions. The Respondent No.1 instead of filing a suit preferred
a writ petition in the year 2016. Another inter-linked issue would
be whether a writ petition ought to have been entertained at all
where the actual and real remedy was by way of a civil suit for
specific performance or for mandatory injunction.
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31. Under Resolution No. 121 dated 16.04.1918, the Respondent No.1
was required to construct 44 Blocks of poorer classes dwellings
consisting 980 rooms and 20 shops, as a pre-condition to be fulfilled
for execution of the lease under Section 32G of the 1898 Act. The
Respondent No.1 after receiving possession of land, constructed
only 476 dwellings and 10 shops till the year 1925. As provided
under the 1925 Act, the earlier schemes already approved under
the 1898 Act were saved and were to be executed by the Board
under the 1925 Act.
32. The Respondent No.1 applied for alteration of Scheme No. 51
notified on 01.05.1918 vide their application dated 10.03.1927. Later
on, vide letter of their solicitors- M/s C.N. Wadia dated 20.05.1927,
a request was made that the Board may accept 476 rooms instead
of 980 rooms and 10 shops instead of 20 shops required under the
old scheme. They also requested for conveyance of Block-B and
for 28 years lease of Block-A and eventual conveyance of Block-A
on completion of the lease period. As the contents of this letter
of M/s C.N. Wadia and Co. dated 20.05.1927 have been referred
to in the subsequent Board resolution, it would be appropriate to
reproduce paragraphs 2,4, 5 and 6 of the said letter, which read
as follows: -
“2. We also request that the Committee will now grant
to the Company a Lease of Block A, for a period of
28 years at a nominal rent of one rupee per annum
as provided in the Act and a conveyance of Block B.
4. We agree to keep a strip 5 feet in width along the
eastern boundary of Block A, open and unbuilt upon,
to permit the board to lay a sewer therein should they
find it necessary to do so. The Conveyance in respect
of this land to be granted on the expiration of the lease
will also make provision for this.
5. As regards Block B, we agree to the following conditions:-
(a) The layout of the land and the plans, etc., of the
buildings to be erected thereon shall be subject to the
Board’s approval.
(b) The height of the buildings shall not exceed a ground
and three floors.
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(c) The user of the buildings and land shall be confined

to shops, chawls, offices, residences, godowns and a
wireless and broadcasting station.
(d) All buildings to be set back 15 feet from the road on
the south and the same distance between the points F
and G from the 40 ft. road on the west.
(e) An open space 10ft. in width if ground floor buildings
are erected, or 15 feet in the case of higher buildings, to
be left along the south side of the boundary D.E.
(f) An open space 15 feet in width to be left along and
within the boundaries Blocks A and B:
(g) Cost of and incidental to the conveyance and stamp
duty to be paid by the Company.
6. It is understood that at the end of period of lease
Block A is to be conveyed to us as freehold land.”
33. The Board passed Resolution No. 325 on 31.05.1927 and granted
alteration of the old scheme. While passing the resolution, it
considered the Chief Officer’s note dated 21.05.1927 recommending
the Board to accept the request. The relevant extract of the Chief
Officer’s note dated 21.05.1927 is reproduced hereunder: -
“”…3. Owing to the construction by the Development
Department of a very large number of rooms in the
immediate vicinity more than sufficient accommodation has
been provided and there is no necessity for the Company
to complete the full number of rooms. They, therefore, ask
the Committee to alter the Scheme in the manner proposed
in their letter and there is no objection to this being done
especially as the Company has refunded to the Board the
amount, with interest, spent on the acquisition of the land.””
34. The Board Resolution No. 325 dated 31.05.1927 reads as follows : -
“Resolution 325 – The Scheme should be and the same
is hereby altered by the exclusion of Blocks B & C on the
Estate Agent’s plan No.98…
2. a lease of Block A for a period of 28 years should be
granted to the Company on the terms mentioned in paras
2 & 4 of Messrs. C.N. Wadia’s letter, dated 20th May, 1927.
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3. Block B should be conveyed to the Company on terms

and conditions mentioned in para 5 of the Company’s letter.
4. Block C will remain the property of the Board.”
35. Pursuant to the above resolution, Block-B was conveyed to
Respondent No.1 for sale consideration of Rs.1,20,000/- on
10.01.1928 and later, lease of Block-A was executed on 03.10.1928
for a period of 28 years effective from 01.04.1927 at a yearly
rent of Re.1/-(Rupee One). As such, the lease was to expire on
31.03.1955. The lease deed dated 03.10.1928, filed as Annexure-P2
before us, incorporates in its initial part the facts including the
details about the Scheme no. 51, which was approved in 1918,
with regard to the entire land comprising of parcels A, B and C
with total land admeasuring 57,758 sq. yds. It, thereafter, refers to
the partial construction by Respondent No.1 and the request made
by Respondent No.1 on 10.03.1927 and 20.05.1927 for alteration
in the scheme. Thereafter, it goes on to mention the approval
of the alteration of said scheme by the Board Resolution dated
31.05.1927 and, then states the terms and conditions thereof.
Under the terms and conditions, lease of Block-A was granted for
a period of 28 years effective from 01.04.1927 with a yearly rent
of Re.1/- (Rupee One only) to be paid without any deduction on
first day of each April.
36. A perusal of the terms and conditions stated in the lease agreement
would reveal that there is no such stipulation that on the expiry of the
period of the lease on 31.03.1955, after completion of 28 years, the
appellants would be bound to convey the said land to Respondent
No.1. Based on the above resolution dated 31.05.1927 and the terms
as incorporated in the lease deed, the submission on behalf of the
appellants is that there was neither any decision taken by the Board
to convey the land in question on expiration of the lease nor does
the lease agreement contain any such clause that the appellants
were bound to convey the land.
37. It is also vehemently submitted that the High Court completely fell
in error in reading the Board’s resolution as agreeing to convey the
land on the expiration of the lease and by interpreting the lease
agreement to have a clause that the Board would convey the land on
the expiration of the lease. Insofar as the lease deed is concerned, the
High Court read the narration of the facts relating to the application
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filed by Respondent No.1 for alteration dated 20.05.1927 to be a term

of the lease to mean that on expiration of the lease, there would be
a conveyance. In fact, there is no such stipulation in the terms and
conditions of the lease deed regarding the conveyance. This was a
clear misreading by the High Court.
38. The lease deed dated 03.10.1928, nowhere recites that the land
comprising in Block-A would be conveyed at the expiration of the
lease term of 28 years provided there was no default on the part
of the lessee as provided in Section 51(2) of the 1925 Act. The
High Court, while referring to the narration of facts in the initial part
of the lease deed, has misinterpreted the same to be a condition
incorporated in the lease deed for conveyance at the end of the
period of lease i.e. on expiration of 28 years.
39. Insofar as the resolution of 31.05.1927 is concerned, the proceedings
of the said meeting have been filed as Annexure-P1 before us, which
is reproduced hereunder :
“Annexure P-1
Exhibit ‘F’
Bombay Improvement Trust
SECRETARY OFFICE,
ESPLANADE ROAD
Excerpt from the Proceedings of a Meeting of the
Improvements Committee held on the 31st May 1927.
1. Re : Scheme No. 51 - Century Mills Housing Scheme
alteration in
Considered the. following ;.
(a) Letter from Messrs. C.N. Wadia & Co., dt. 20th May 1927.
“With reference to the Committee’s Resolution No. 165,
dated the 24th March last, we beg to request that as we
have paid to the Board the sums due under Section 46(3)
of the Act, the Committee may be moved to alter the
Scheme under Section 37(2) by the omission therefrom
of Blocks B and C on the accompanying plan.”
2. We also request that the Committee will now grant to
the Company a lease of Block A for a period of 28 years
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at a nominal rent of one rupee per annum as provided in

the Act and a conveyance of Block B.
3. It was arranged in 1923 that plot C should revert to
the Trust.
4. We agree to keep a strip 5 feet in width along the
eastern boundary of Block A, open and unbuilt upon, and
to permit the Board to lay a sewer therein should they find
it necessary· to do so. The conveyance in respect of this
land to be granted on the expiration of the lease will also
make provision for this.
5. As regards Block B, we agree to the following conditions:-
(a) The lay out of the land and the plans, etc., of the
buildings to be erected thereon shall be subject to the
Board’s approval.
(b) The height of the buildings shall not exceed a ground
and three floors.
(c) The user of the buildings and land shall be confided
to shops, chawls, offices, residences, godowns and a
wireless and broadcasting station.
(d) All buildings to be set back 15 feet from the road on
the south and the same distance between the points F
and G from the 40 ft. road on the west.
(e) An open space 10 ft. in width if ground floor buildings
are erected, or 15 feet in the case of higher buildings, to
be left along the south side of the boundary D. E.
(f) An open space 15 feet in width to be· left along and
within the boundaries Blocks A and B.
(g) Cost of and incidental to the conveyance and stamp
duty to be paid by the Company.
6. It is understood that at the end of the period of lease,
Block A is to be conveyed to us as freehold land”.
(b) Chief Officer’s note, dated 21st May 1927.
“This Scheme was sanctioned in 1919 and provided for
the acquisition of the land by the Board and the filling in
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of the site and the construction of the buildings by the

Century. Spinning and Manufacturing Co., Ltd.
2. The Company originally Intended to erect 44 blocks of
buildings containing 980 rooms and 20 shops and have
in fact complete 476 rooms and 10 shops.
3. Owing to the construction by the Development
Department of a very large number of rooms in the
immediate vicinity more than sufficient accommodation has
been provided and there is no necessity for the Company
to complete the full number of rooms. They, therefore, ask
the Committee to alter the Scheme in the manner proposed
in their letter and there is no objection to this being done
especially as the Company has refunded to the Board the
amount, with interest, spent on the acquisition of the land.”
Resolution 325 - The Scheme should be and the
same is hereby altered by the exclusion ·of Blocks
B & C on the Estate Agent’s plan No. 98, dated 17th
May 1927.
2. A lease of Block A for a period of 28 years should
be granted to the Company on the terms mentioned
in paras 2 & 4 of Messrs. C.N. Wadia’s letter, dated
20th May 1927.
3. Block B should be conveyed to the Company on
the terms and conditions mentioned in para 5 of the
Company’s letter.
4. Block C will remain the property of the Board.
True Excerpt,
C.P. GORWALLA
Secretary”
40. A careful reading of the above excerpts reflects that the letter from
M/s C.N. Wadia dated 20.05.1927 is reproduced as it is in the
beginning which runs into 6 paragraphs. Thereafter, it considered
the Chief Officer’s note dated 21.05.1927 which we have briefly
referred to in earlier part of this judgment. Thereafter, it records
that the Respondent No.1 originally intended to erect 980 rooms
with 20 shops. As per the said note, it gave details of the original
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scheme, the alteration requested for and further the reasons that
because of construction by the development department, sufficient
accommodation is now available and there may not be any necessity
for company to complete the full number of rooms, as such the
request for alteration may be considered. Thereafter, the Resolution
No. 325 is recorded which reflects that the scheme stands altered
by excluding Block-B and Block-C, the lease of Block-A for a period
of 28 years to be granted on the terms mentioned in paragraphs
2 and 4 of letter dated 20.05.1927 of M/s C.N. Wadia, Block-B to be
conveyed to the company in terms of paragraph 5 of the aforesaid
letter and Block-C to remain property of the Board.
41. Based on the above reading of the resolution dated 31.05.1927, first
and foremost, it must be noted that paragraph 6 of the letter dated
20.05.1927 is not approved by the Board which states that at the end
of the period of lease, Block-A is to be conveyed to the company as
freehold land. Secondly, it approves granting of lease on the terms
mentioned in paragraphs 2 and 4 of the said letter dated 20.05.1927.
Paragraph 2 does not refer to any conveyance of Block-A. Paragraph
4 states about leaving strip of five feet along eastern boundary open
and unbuilt to permit the Board to lay the sewer. It further stipulates
that the conveyance in respect of “this land” to be granted on the
expiration of the lease will also make provision for this. “This land”
means the strip of five feet and not Block-A.
42. The High Court’s recording that, once paragraph 4 refers to
conveyance in respect of “this land”, it is to be treated as Block-A,
is actually misreading and misinterpreting paragraph 4 of the
communication dated 20.05.1927. It only says the conveyance, if
made, on the expiration of the lease will take into consideration
provision for this land. The main request of the Respondent No.1
in its communication dated 20.05.1927 with regard to conveyance
of Block-A is stated in paragraph 6 which the Board Resolution No.
325 does not approve or accept. The High Court, thus, fell in error
in reading paragraph 4 of the communication dated 20.05.1927 to
understand that the Board minutes approved the conveyance of
Block ‘A’.
43. The conveyance as stated in paragraph 4 is with respect to five
feet strip of land on the eastern side and the same would become
effective and applicable only if paragraph 6 of their letter was
accepted. In the absence of approval of paragraph 6 of the said
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letter dated 20.05.1927, it cannot be held that the Board approved

the conveyance of Block-A after expiration of the period of lease.
44. From the above analysis, it is more than clear that neither the Board
Resolution No. 325 dated 31.05.1927 nor the lease deed anywhere
states about conveyance of Block-A on the expiration of the lease
deed. The High Court, thus, fell in error in interpreting both the
documents otherwise.
45. Further arguments on behalf of Respondent No.1 with respect to
conveyance being executed rest on Section 51(2) of 1925 Act. In
this respect, it would be appropriate to first deal with Section 48(a)
of the 1925 Act and read Section 51(2) of the said Act along with
the said provision. Under Section 48(a) of the 1925 Act on the
expiration of the lease period, the lessee shall leave the demised
premises in good and substantial repair conditions along with fixtures,
if any, whereas Section 51(2) of the said Act provides that where no
default is made by the lessee in the conditions of the lease, then on
determination of the lease at the end of the term, the Board shall
convey the premise to the lessee at his cost and such conveyance
to be free of all restrictions and liabilities imposed under the lease
deed and also by the 1898 Act. The submission on behalf of the
appellants is that Section 48(a) of the 1925 Act would be rendered
otiose and meaningless, if Section 51(2) of the said Act is read and
interpreted as submitted by the counsel for Respondent No.1 which
is to the effect that, Section 51(2) of the said Act being a special
provision whereas Section 48(a) thereof is a general provision, the
special provision will prevail over the general provision. We may not
agree with the above submission of Respondent No.1 as submitted
but would rather read both the provisions and test whether they
could co-exist and be construed harmoniously.
46. Both the provisions, Section 48(a) and Section 51(2) of the 1925 Act,
have to be read in the context in which they have been incorporated.
Section 48 of the 1925 Act provides the general conditions of the
lease given under the PCAS placing restrictions on the lessee as
to how it would use and how the rent etc. would be determined
for letting out the tenements. Whereas, Section 51 of the said Act
provides for default, and determination of the lease. If there is default,
then under Section 51(1) of the 1925 Act, the Board has a right to
re-enter upon the demised premises whereas under sub-Section
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(2) thereof provides that where no default is made, the Board shall
convey the premise to the lessee at his cost.
47. If Section 48(a) and Section 51(2) of the 1925 Act are to be interpreted
harmoniously, the net result is that under general provisions, the
lessee has to leave the premise on completion of the period of lease,
however, it will have a right to get the conveyance executed at the
end of the lease, provided there has been no default, after paying
the cost of the said premise.
48. Well-settled principles of statutory interpretation demand that no
provision of a statute should be rendered nugatory or superfluous. A
statute must be construed as a coherent whole, ensuring that each
part has meaningful content and that the legislative scheme remains
workable. Where two provisions appear to be in tension, the proper
course is to adopt a construction that reconciles them, allowing both
to operate and giving effect to the underlying legislative intent. It is
neither necessary nor desirable to treat section 51(2) of the 1925 Act
as an absolute mandate that would override or negate Section 48(a)
thereof. Instead, they must be read harmoniously so that the duty to
restore the premises at the end of the lease remains intact, unless a
clear contrary intention emerges, and the right to conveyance under
Section 51(2) thereof is recognized as contingent, not automatic.
49. Such a reading is consistent with the accepted principle that a
statutory provision should not be construed in a manner that
would reduce another provision to a “dead letter.” The reference in
Section 48(a) of the 1925 Act leaving the premises in good repair is
not a mere formality but a substantive condition governing the lessee’s
obligations. Simultaneously, Section 51(2) thereof contemplates a
conveyance only where the conditions of the lease have been duly
met and the terms of the governing arrangement so permit. By
interpreting Section 51(2) of the said Act as a provision that confers
a right to conveyance contingent upon the terms of the lease and the
broader legislative context, rather than as an unqualified command,
the overall scheme of the Act is preserved. This ensures that the
statute remains fully operative, logical, and internally consistent.
50. Interpreting Section 51(2) in this calibrated manner ensures that no
non-obstante clause or hierarchical superiority is artificially read into
the statute. Nothing in the language of Section 51(2) of the 1925
Act suggests that it must prevail to the exclusion of other provisions,
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nor does Section 48(a) thereof state that its conditions are subject
to displacement by Section 51(2) of the said Act. Each provision,
on a proper reading, retains its respective field of operation. The
terms and intentions underlying the lease itself become the primary
determinant of whether the eventual conveyance is warranted or not.
Thus, rather than insisting that “shall convey” invariably means an
unconditional obligation, it is more appropriate to understand that it
calls for conveyance only where the arrangement and compliance
align with the statutory prerequisites.
51. By employing a harmonious construction, the 1925 Act’s provisions
are allowed to complement rather than contradict one another. This
approach upholds the integrity of the legislative scheme, ensures that
none of its components are undermined, and maintains a balance
between the obligations imposed on a lessee and any rights that
may accrue at the end of the lease’s tenure. These principles were
reiterated by a three-Judge Bench of this Court in CIT (supra). The
relevant paragraphs are reproduced hereunder:
“14.A construction which reduces the statute to a futility
has to be avoided. A statute or any enacting provision
therein must be so construed as to make it effective and
operative on the principle expressed in the maxim ut res
magis valeat quam pereat i.e. a liberal construction should
be put upon written instruments, so as to uphold them, if
possible, and carry into effect the intention of the parties.
[See Broom’s Legal Maxims (10th Edn.), p. 361, Craies
on Statutes (7th Edn.), p. 95 and Maxwell on Statutes
(11th Edn.), p. 221.]
15. A statute is designed to be workable and the
interpretation thereof by a court should be to secure that
object unless crucial omission or clear direction makes
that end unattainable. (See Whitney v. IRC [1926 AC 37 :
10 Tax Cas 88 : 95 LJKB 165 : 134 LT 98 (HL)], AC at
p. 52 referred to in CIT v. S. Teja Singh [AIR 1959 SC
352 : (1959) 35 ITR 408] and Gursahai Saigal v. CIT [AIR
1963 SC 1062 : (1963) 48 ITR 1].)
16. The courts will have to reject that construction which
will defeat the plain intention of the legislature even though
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there may be some inexactitude in the language used. (See

Salmon v. Duncombe [(1886) 11 AC 627 : 55 LJPC 69 :
55 LT 446 (PC)] AC at p. 634, Curtis v. Stovin [(1889) 22
QBD 513 : 58 LJQB 174 : 60 LT 772 (CA)] referred to in S.
Teja Singh case [AIR 1959 SC 352 : (1959) 35 ITR 408].)
17. If the choice is between two interpretations, the
narrower of which would fail to achieve the manifest
purpose of the legislation, we should avoid a construction
which would reduce the legislation to futility, and should
rather accept the bolder construction, based on the view
that Parliament would legislate only for the purpose of
bringing about an effective result. (See Nokes v. Doncaster
Amalgamated Collieries [(1940) 3 All ER 549 : 1940 AC
1014 : 109 LJKB 865 : 163 LT 343 (HL)] referred to in
Pye v. Minister for Lands for NSW [(1954) 3 All ER 514 :
(1954) 1 WLR 1410 (PC)].) The principles indicated in the
said cases were reiterated by this Court in Mohan Kumar
Singhania v. Union of India [1992 Supp (1) SCC 594 : 1992
SCC (L&S) 455 : (1992) 19 ATC 881 : AIR 1992 SC 1].
18. The statute must be read as a whole and one provision
of the Act should be construed with reference to other
provisions in the same Act so as to make a consistent
enactment of the whole statute.
19. The court must ascertain the intention of the legislature
by directing its attention not merely to the clauses to be
construed but to the entire statute; it must compare the
clause with other parts of the law and the setting in which
the clause to be interpreted occurs. (See R.S. Raghunath
v. State of Karnataka [(1992) 1 SCC 335 : 1992 SCC (L&S)
286 : (1992) 19 ATC 507 : AIR 1992 SC 81].) Such a
construction has the merit of avoiding any inconsistency or
repugnancy either within a section or between two different
sections or provisions of the same statute. It is the duty of
the court to avoid a head-on clash between two sections
of the same Act. (See Sultana Begum v. Prem Chand Jain
[(1997) 1 SCC 373 : AIR 1997 SC 1006].)
20. Whenever it is possible to do so, it must be done to
construe the provisions which appear to conflict so that
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they harmonise. It should not be lightly assumed that

Parliament had given with one hand what it took away
with the other.
21. The provisions of one section of the statute cannot be
used to defeat those of another unless it is impossible to
effect reconciliation between them. Thus a construction
that reduces one of the provisions to a “useless lumber”
or “dead letter” is not a harmonised construction. To
harmonise is not to destroy.”
52. Therefore, in our considered opinion, the interplay between
Sections 48(a) and 51(2) of the 1925 Act is resolved through a
construction that acknowledges the necessity of leaving the premises
in good condition at the expiration of lease, while recognizing that
a conveyance can be contemplated only where such a course
is unequivocally aligned with the lease terms and the statutory
framework as a whole. This reconciliation preserves the intention
of the legislature, avoids destructive interpretations, and provides a
coherent, just, and practical reading of the statute.
53. In light of the above discussion, it becomes evident that neither the
statutory framework in force nor the terms of the lease deed imposed
any obligation upon the appellant to execute a conveyance in favour
of the Respondent No.1. While the Respondent No.1 has sought
to rely upon selective readings of the statutory provisions and the
Board’s resolutions, a harmonious and contextual interpretation
of Sections 48(a) and 51(2) of the 1925 Act, as well as the clear
absence of any covenant to that effect in the lease deed, unequivocally
demonstrates that no vested right to conveyance arose on the
expiration of the lease. Absent any express statutory mandate or
contractual stipulation, the claim for compulsory conveyance at the
end of the lease term must fail.
54. Even if in arguendo, we agree to the Respondent No.1’s contention
that the lease conferred a right to conveyance in their favour, the fact
that cannot be overlooked is that Respondent No.1 failed to take any
active step in furtherance of getting such a conveyance executed at
the end of the lease term. A major reliance has been placed by the
Respondent No.1 on Section 51(2) of the 1925 Act, which clearly
states that the Board shall convey the premises to the lessee at his
cost. The term “at his cost” shall include the charges involved in
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conversion of lease hold property into free hold property and would
routinely comprise of registration charges, stamping charges etc. It
is evident that the Respondent No.1, after the expiry of term of the
lease, has neither paid any such charges towards the cost in an effort
to seek conveyance nor availed any alternative remedy by filing a
suit for specific performance or mandatory injunction. Therefore, the
Respondent No.1’s reliance on Section 51(2) will also not come to
their rescue when it is apparent that they have not fulfilled their part
of the obligation under the said provision.
55. From the above discussion and analysis, the first core question
stands answered in favour of the appellants that they were neither
bound nor were under any legal obligations to convey the premises
comprising Block-A to the Respondent No.1.
56. Now we come to the second core issue regarding the writ petition
before the High Court suffering from serious delay and laches and
as such liable to be dismissed on that ground alone. Admittedly,
the term of the lease came to an end on 31.03.1955. It is also
uncontested that thereafter the Respondent No.1 never claimed
execution of conveyance at any point of time till 2006, when for
the first time they issued a legal notice dated 14.08.2006 purported
to be under Section 527 of the 1888 Act requiring the appellant to
execute the conveyance deed. Thus, for a period of 51 years, the
Respondent No.1 did not raise any demand whatsoever for execution
of the conveyance deed. Their contention that they were in constant
communication with the officers of the Corporation, though orally,
the fact remains that no legal proceedings were undertaken during
this period. Even after giving the notice under Section 527 of 1888
Act, the Respondent No.1 took no steps for a period of 10 years
by filing a suit or approaching the Court even though the period of
limitation prescribed under the above provision was six months. Ten
years after the legal notice, they preferred the writ petition, i.e. after
61 years of the cause of action having arisen.
57. We find that the High Court has cursorily dealt with this aspect and
held that the writ petition does not suffer from laches. The High Court
actually held that there was inaction on the part of the appellant in
not executing the conveyance deed. On the contrary, Respondent
No.1 never approached the appellant requiring them either to provide
the details of the stamp duty, registration charges etc. so that the
conveyance deed could be typed out on such stamp papers and
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thereafter to be presented for registration. The Respondent No.1

has neither made any pleadings nor has led any evidence to the
above effect.
58. The view taken by the High Court in treating the petition to be not
suffering from any delay and laches cannot be sustained. Reference
may be made to the following judgments wherein delay and laches
being non-condonable while filing petition, especially under land
acquisition matters, has been elaborately dealt with and has been
the consistent view of this Court that such belated petitions are liable
to be dismissed.
59. In Aflatoon v. Lt. Governor of Delhi,21 it was held that:
“9. Assuming for the moment that the public purpose
was not sufficiently specified in the notification, did the
appellants make a grievance of it at the appropriate time?
If the appellants had really been prejudiced by the non-
specification of the public purpose for which the plots in
which they were interested were needed, they should
have taken steps to have the notification quashed on that
ground within a reasonable time. They did not move in
the matter even after the declaration under Section 6 was
published in 1966. They approached the High Court with
their writ petitions only in 1970 when the notices under
Section 9 were issued to them. In the concluding portion
of the judgment in Munshi Singh v. Union of India [(1973)
2 SCC 337, 342 : (1973) 1 SCR 973, 975, 984], it was
observed : [SCC p. 344, para 10]
“In matters of this nature we would have taken
due notice of laches on the part of the appellants
while granting the above relief but we are
satisfied that so far as the present appellants are
concerned they have not been guilty of laches,
delay or acquiescence at any stage.”
We do not think that the appellants were vigilant.
10. That apart, the appellants did not contend before the
High Court that as the particulars of the public purpose

21 [1975] 1 SCR 802 : (1975) 4 SCC 285

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were not specified in the notification issued under Section

4, they were prejudiced in that they could not effectively
exercise their right under Section 5-A. As the plea was not
raised by the appellants in the writ petitions filed before
the High Court, we do not think that the appellants are
entitled to have the plea considered in these appeals.
11. Nor do we think that the petitioners in the writ petitions
should be allowed to raise this plea in view of their conduct
in not challenging the validity of the notification even after
the publication of the declaration under Section 6 in 1966.
Of the two writ petitions, one is filed by one of the appellants.
There was apparently no reason why the writ petitioners
should have waited till 1972 to come to this Court for
challenging the validity of the notification issued in 1959
on the ground that the particulars of the public purpose
were not specified. A valid notification under Section 4 is
a sine qua non for initiation of proceedings for acquisition
of property. To have sat on the fence and allowed the
Government to complete the acquisition proceedings on
the basis that the notification under Section 4 and the
declaration under Section 6 were valid and then to attack
the notification on grounds which were available to them
at the time when the notification was published would be
putting a premium on dilatory tactics. The writ petitions are
liable to be dismissed on the ground of laches and delay
on the part of the petitioners (see Tilokchand Motichand v.
H.B. Munshi [(1969) 1 SCC 110 : [1969] 2 SCR 824] and
Rabindranath Base v. Union of India [(1970) 1 SCC 84 :
[1970] 2 SCR 697]).”
60. Similarly, in Hari Singh v. State of U.P.,22 it was observed that:
“4. At the outset we are of the view that the writ petition
filed in July 1982 questioning the notification issued in
January 1980 after a delay of nearly two and a half years
is liable to be dismissed on the ground of laches only. It
is no doubt true that the appellants have pleaded that
they did not know anything about the notifications which

22 (1984) 2 SCC 624

[2025] 1 S.C.R.  355

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

had been published in the Gazette till they came to know

of the notices issued under Section 9(3) of the Act but
they have not pleaded that there was no publication in
the locality of the public notice of the substance of the
notification as required by Section 4(1) of the Act. It
should be presumed that official acts would have been
performed duly as required by law. It is significant that
a large number of persons who own the remaining plots
have not challenged the acquisition proceedings. The only
other petition in which these proceedings are challenged
is Civil Misc. Writ Petition No. 11476 of 1982 on the file
of the High Court filed subsequently by Amar Singh and
four others. Moreover in a small place like Kheragarh
where these plots are situate, the acquisition of these
lands would be the talk of the town in a short while and it
is difficult to believe that the appellants who are residents
of that place would not have known till July 1982 that the
impugned notification had been published in 1980. Any
interference in this case filed after two and a half years
with the acquisition proceedings is likely to cause serious
public prejudice. This appeal should, therefore, fail on the
ground of delay alone.”
61. Likewise, in Municipal Corporation of Greater Bombay v. Industrial
Development Investment Co. (P) Ltd.,23 with regards to the question
of delay and laches, it was held that:
“29. It is thus well-settled law that when there is inordinate
delay in filing the writ petition and when all steps taken in
the acquisition proceedings have become final, the Court
should be loath to quash the notifications. The High Court
has, no doubt, discretionary powers under Article 226 of
the Constitution to quash the notification under Section 4(1)
and declaration under Section 6. But it should be exercised
taking all relevant factors into pragmatic consideration.
When the award was passed and possession was taken,
the Court should not have exercised its power to quash
the award which is a material factor to be taken into

23 [1996] Supp. 5 SCR 551 : (1996) 11 SCC 501

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consideration before exercising the power under Article

226. The fact that no third party rights were created in
the case is hardly a ground for interference. The Division
Bench of the High Court was not right in interfering with
the discretion exercised by the learned Single Judge
dismissing the writ petition on the ground of laches.”
62. More recently, this Court in New Okhla Industrial Development
Authority v. Harkishan,24 had held that:
“12. More importantly, when the respondents made the
representation, it was dealt with and rejected by the
State Government vide order dated 3-12-1999. At that
time, award had been passed. However, in the second
round of writ petitions preferred by the respondents, they
chose to challenge only Office Order dated 3-12-1999
vide which their representation under Section 48 of the
Act had been rejected and it never dawned on them to
challenge the validity of the award on the ground that
the same was not passed within the prescribed period of
limitation. As noted above, in the second round of litigation
also, the respondents failed in their attempt, inasmuch as,
this Court put its imprimatur to the rejection order dated
3-12-1999 vide its judgment dated 12-3-2003 [Ved Prakash
v. Ministry of Industry (2003) 9 SCC 542]. At that time, even
the possession of land had been taken. If the respondents
wanted to challenge the validity of the award on the ground
that it was passed beyond the period of limitation, they
should have done so immediately and, in any case, in the
second round of writ petitions filed by them. Filing fresh
writ petition challenging the validity of the award for the
first time in the year 2004 would, therefore, not only be
barred by the provisions of Order 2 Rule 2 of the Code
of Civil Procedure, 1908, but would also be barred on the
doctrine of laches and delays as well.”
63. There is yet another aspect of the matter to be considered. The
Respondent No.1 had a statutory remedy of filing a suit under

24 [2017] 1 SCR 572 : (2017) 3 SCC 588

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The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

Section 527 of the 1988 Act which they could have availed. In fact,
the Respondent No.1 proceeded in that direction by giving a notice
to file a suit but never filed the suit although limitation for the same
was six months. The Respondent No.1 apparently chose to file the
writ petition in 2016 after 10 years only in order to escape from the
clutches of the limitation. In this regard, it was held in Shri Vallabh
Glass Works Ltd. (supra), that:
“9. …Whether relief should be granted to a petitioner under
Article 226 of the Constitution where the cause of action
had arisen in the remote past is a matter of sound judicial
discretion governed by the doctrine of laches. Where a
petitioner who could have availed of the alternative remedy
by way of suit approaches the High Court under Article 226
of the Constitution, it is appropriate ordinarily to construe
any unexplained delay in the filing of the writ petition after
the expiry of the period of limitation prescribed for filing
a suit as unreasonable. This rule, however, cannot be a
rigid formula. There may be cases where even a delay of a
shorter period may be considered to be sufficient to refuse
relief in a petition under Article 226 of the Constitution. There
may also be cases where there may be circumstances
which may persuade the court to grant relief even though
the petition may have been filed beyond the period of
limitation prescribed for a suit. Each case has to be judged
on its own facts and circumstances touching the conduct of
the parties, the change in situation, the prejudice which is
likely to be caused to the opposite party or to the general
public etc. In the instant case, the appellants had in fact
approached the High Court on September 28, 1976 itself
by filing Special Civil Application No. 1365 of 1976 for
directing repayment of the excess duty paid by them. But
no relief could be granted in that petition in view of the
provisions of Article 226 of the Constitution as it stood then
and the petition had to be withdrawn. Hence even granting
that on the date of making each payment of excise duty in
excess of the proper duty payable under law, the appellants
should be deemed to have discovered the mistake, all such
excess payments made on and after September 28, 1973
which would fall within the period of three years prior to the
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date on which Special Civil Application No. 1365 of 1976

was filed should have been ordered to be refunded under
Article 226 of the Constitution. But the High Court declined
to do so on grounds of estoppel and acquiescence. While
we do agree that the appellants should not be granted
any relief in respect of payment made between October
1, 1963 and September 27, 1973 which would fall beyond
three years from the date of the first writ petition filed in
this case we do not find it proper and just to negative the
claim of the appellants in respect of excess payments
made after September 28, 1973. In the instant case the
appellants had made excess payments on being assessed
by the Department and such payments cannot be treated
as voluntary payments precluding them from recovering
them. (See Sales Tax Officer v. Kanhaiya Lal Mukundlal
Saraf [AIR 1959 SC 135 : [1959] SCR 1350 : 9 STC 747].)
We do not also find that the conduct of the appellants is
of such a nature as would disentitle them to claim refund
of excess payments made in respect of goods other than
wired glass.”
Therefore, the writ petition ought to have been dismissed on this
ground of delay and laches alone. We find no merit in the conduct
of the Respondent No. 1 where it deliberately chose to sit still on its
rights for a long period of fifty-one years. Even after such a belated
delay and sending a notice to the appellant in 2006, the Respondent
No.1 again failed to exhibit any diligence and chose not to file a
suit within the period of limitation under the 1888 Act. Instead, the
Respondent No.1 has shown utmost craftiness and lack of bona
fide in preferring the writ petition before the High Court in 2016 as
it is clearly a route adopted to subvert the long delay of sixty-one
years, which we do not find condonable, given the conduct of the
Respondent No.1 throughout.
64. Further, it must also be observed that Respondent No.1 had submitted
plans in 2009 for altering the use of Plot A for commercial purposes
and would no longer be providing for Poorer Classes Accommodation
as was agreed in the lease deed of 1928. Clause 2(VIII) of the lease
deed has been reproduced below which explicitly states the purpose
of the lease deed:
[2025] 1 S.C.R.  359

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

“VIII To use the demised premises (except such portions

thereof as contain shops, caretakers’ quarters, and the
like) exclusively as dwellings for the members of the poorer
classes, being persons employed by the Lessees in the
course of their business, and the families of such persons,
except in so far as there may not be sufficient numbers of
such persons willing to occupy the same, and in any case
only for members of the poorer classes. And in particular
not to use the demised premises or any part thereof, or
permit the same to be used as a public house, refreshment
room, booth, or shop for the sale for consumption either on
or off the demised premises of intoxicating liquors, whether
country or foreign, and whether by retail or wholesale,
or for any other purpose whatsoever otherwise than as
dwellings, except with the previous consent in writing of
the Board, and not at any time to permit stables, factories,
workshops, or workplaces on the demised land. And not
to do or suffer to be done on the said premises anything
which may be or become noisome, injurious, or offensive
to the Board or the owners or occupiers of this or any
other property in the neighbourhood.”
65. Moreover, the Preamble to the 1925 Act also clearly states that it
“was enacted with a view to make provision for the improvement
and for the future expansion of the City of Bombay by forming new
and altering streets, by removing or altering insanitary buildings in
certain areas, by providing open spaces for better ventilation and for
recreation, by constructing new sanitary dwellings for certain classes
of the inhabitants of the said city and for the Bombay City police,
by laying out vacant lands and by divers other means;”. While the
Respondent No.1 would have been allowed to use it for commercial
purposes had the land been duly conveyed to them, it has already
been shown that conveyance was never granted in the sale deed
dated 1928, nor was any “cost” paid for the conveyance. The lease
deed, by itself, did not confer any rights to convert the usage of the
lands for commercial purposes.
66. It is clear that the protective and welfare-oriented character of the
arrangement is integral to the statutory objective. The inclusion of
Clause 2(VIII) in the lease deed was not a casual insertion; it was
intended to ensure that the property would serve as an instrument of
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social betterment by housing those who are economically vulnerable.

This provision, coupled with the Preamble’s emphasis on “constructing
new sanitary dwellings for certain classes of the inhabitants,” reflects
a deliberate legislative policy to secure tangible benefits for the
poorer sections of society. The statutory and contractual framework
is not merely concerned with property rights and transactions in the
abstract; it aims to harness urban development to serve the pressing
social needs of the community. By seeking to redirect the property
towards commercial exploitation, Respondent No.1 threatens to erode
the very foundation upon which the original agreement stood. The
contractual language and statutory purpose are both premised on
ensuring that the “demised premises” remain dedicated to providing
adequate housing to those otherwise struggling to find decent living
conditions in a rapidly expanding metropolis. To ignore or circumvent
these conditions would nullify the intended social function of the
property and transform a carefully crafted scheme of public welfare
into a mere instrument of private profit.
67. Such a departure from the intended purpose is not only a breach of
the lease conditions but also a subversion of the policy that animated
the entire statutory regime. The legislation and the contract work in
tandem to ensure that urban improvement aligns with the welfare
of weaker segments. When land allocated under a special scheme,
particularly one centred on “poorer classes” accommodation, is sought
to be commercially exploited, it represents a direct affront to the spirit
of the enactment. Rather than addressing housing inadequacies
and improving urban life for those in need, the resource would be
diverted to profit-making ventures that do nothing to alleviate the
conditions of the underserved.
68. This conduct amounts to an abuse of beneficial legislation. The
1925 Act was clearly intended to secure broader societal goals—
better sanitation, improved living standards, and well-planned urban
growth that includes and benefits marginalized communities. Allowing
Respondent No.1 to disregard these obligations would open the
door to hollowing out the protections and advantages established
by the statute. It would set a precedent where statutory schemes
designed to uplift vulnerable groups could be co-opted for purely
commercial ends, undermining the trust and faith that must exist
between public authorities, private actors, and the most vulnerable
segments of the population.
[2025] 1 S.C.R.  361

The Municipal Corporation of Greater Mumbai & Ors. v.

Century Textiles and Industries Limited & Ors.

69. In essence, the entire arrangement is anchored on a quid pro quo :

the property is leased on special terms, with minimal rent and under
carefully prescribed conditions, to ensure that the less-privileged
receive tangible benefits. When the lessee attempts to convert this
arrangement into a vehicle for commercial gain, it repudiates the
fundamental bargain. The public trust reposed in the private entity
to serve a greater good is thus betrayed. This not only harms the
class of beneficiaries whom the legislation and agreement were
designed to protect, but also imperils the broader public interest
by allowing beneficial legislative frameworks to be distorted and
exploited contrary to their genuine purpose.
70. For all the reasons recorded above, the judgment of the High
Court cannot be sustained. Accordingly, the appeal is allowed, the
impugned judgment of the High Court is set aside, and the writ
petition is dismissed.
71. Pending application(s), if any, shall stand disposed of.

Result of the case: Appeal allowed

†
Headnotes prepared by: Nidhi Jain
 [2025] 1 S.C.R. 362 : 2025 INSC 43

Om Prakash @ Israel @ Raju @ Raju Das

v.
Union of India and Another
(Criminal Appeal No. 4229 of 2024)
08 January 2025
[M.M. Sundresh* and Aravind Kumar, JJ.]

Issue for Consideration

Issue arose as regards plea of juvenility raised u/s.9(2) of the
Juvenile Justice (Care and Protection of Children) Act, 2015.

Headnotes†
Juvenile Justice (Care and Protection of Children) Act, 2015 –
s.9(2) – Plea of juvenility – Appellant charged for the offence of
culpable homicide amounting to murder, for incident occurred
in 1994 – On recording of statements in 2001, the appellant
stated his age as 20 years – After conviction, the appellant
raised the plea of juvenility during the hearing on sentence
that he was around 17 years at the time of occurrence –
Trial court, relying upon his statement regarding the bank
account, presumed that he was major and sentenced him to
death – Upheld by the High Court as also Supreme Court –
Review Petition thereagainst also dismissed – Mercy Petition
before the Governor also rejected – Thereafter, Writ Petition
u/Art.32 as also Curative Petition dismissed – Mercy Petition
filed before Hon’ble the President of India – During the
pendency, 2007 Rules came into effect – Ossification test done
and the Medical Age Certificate indicated that the appellant
was aged around 14 years at the time of the occurrence – By
Presidential Order, death sentence of the appellant commuted
to life imprisonment, with caveat that he shall not be released
until the attainment of 60 years of age – Subsequent Curative
Petition rejected – Appellant then filed Writ Petition before the
High Court challenging the Presidential Order and also for
seeking relief u/s.9(2) – Writ Petition dismissed holding that
the power of judicial review over an executive order passed
in exercise of Art. 72 is limited, and the proceedings against
the appellant had attained finality – Challenge to:

* Author
[2025] 1 S.C.R.  363

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Held: No dispute that the appellant was only 14 years old at

the time of the commission of the offence – At every stage,
injustice has been inflicted by the Courts, either by ignoring the
documents or by casting a furtive glance – Appellant, despite
being illiterate, raised this plea one way or another, right from the
trial court up to the conclusion of the Curative Petition before this
Court – Approach of the Courts in the earlier round of litigation
cannot be sustained in the eye of law – Statement given by the
appellant at the time of the hearing on his sentence, also pale
into insignificance, as even then he would have been a minor at
the time of commission of the offence, under both the 2000 and
the 2015 Acts – Procedural mandate contemplated under the
1986 Act not followed by the courts below – Curative petition
dismissed without according any reason – Even the then existing
State Rules not duly followed – When the plea of juvenility was
raised, it should have been dealt with under the existing laws at
the relevant point of time, especially when there exists a tacit
and clear admission as to the age of the appellant – This Court
could have dealt with the writ petition filed u/Art.32, as it raised
independent prayer for the enforcement of a right conferred under
a social welfare legislation – In the subsequent writ petition filed
before the High Court, two different prayer made, the determination
of the appellant’s plea of juvenility and consequent release, or
alternatively judicial review of the decision of the President or
the Governor and consequent release – Executive cannot be
construed to have undertaken an adjudication on the determination
of the age of the accused and first prayer being a distinct one
invoking s.9(2), the High Court erred in its reasoning – Appellant
has been suffering due to the error committed by the Courts –
His conduct in the prison is normal, with no adverse report – He
lost an opportunity to reintegrate into the society – Time which
he has lost, for no fault of his, can never be restored – Thus,
the sentence imposed in excess of the upper limit prescribed
under the relevant Act set aside, while maintaining the conviction
rendered – It is not a review of the Presidential Order, but a case
of giving the benefit of the provisions of the 2015 Act – State Legal
Services Authority to identify welfare scheme of the State/Central
Government, facilitating the appellant’s rehabilitation and smooth
reintegration into the society upon his release, with emphasis
on his right to livelihood, shelter and sustenance guaranteed
u/Art.21. [Paras 44-54]
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Justice delivery system – Concept of truth – Duty of Court –

Explanation:
Held: Justice is nothing but a manifestation of the truth, which
transcends every other action – Primary duty of the Court is to make
a single-minded endeavour to unearth the truth hidden beneath
the facts – Court is a search engine of truth, with procedural and
substantive laws as its tools – When procedural law stands in the
way of the truth, the Court must find a way to circumvent it – When
substantive law does not facilitate the emergence of the truth, it
is the paramount duty of the Court to interpret the law in light of
its teleos – Such exercise warranted in a higher degree, while
considering a social welfare legislation – Court must discern the
truth, primarily from the material available on record in the form of
pleadings, and arguments duly supported by documents – Entire
judicial system meant for the discovery of the truth, it being the
soul of a decision – Presiding Officer expected to play an active
role, rather than a passive one. [Paras 4-6]
Juvenility – Juvenile justice – Rights of juvenile – Role of
juvenile courts and Constitutional Courts:
Held: Deviant behaviour of a child in conflict with law should
be a concern of the society as a whole – Child not responsible
for an act of crime, but rather victimized by it – Behaviour of a
child can be attributed to environment, the child grows in, and
genetics – Remedial measures may be employed for the benefit
of the child since the child does not choose the environment in
which it grows, deviant behaviour which is a result of exposure to
a given environment is evidence of rampant inequality – Thus, a
child who lives in a discriminatory environment, requires equitable
treatment on the touchstone of Arts. 14, 15(3) rw Art. 39 (e) and (f),
Arts. 45 and 47 – Court expected to play the role of parens patriae
by treating a child not as a delinquent, but as a victim, viewed
through the lens of reformation, rehabilitation and reintegration into
the society – Juvenile Court is a species of a parent – Delinquent,
who appears before the Court, is to be protected and re-educated,
rather than be judged and punished – Court to press into service
the benevolent provisions for rehabilitation introduced by the
Legislature – Juvenile Court assumes the role of an institution
rendering psychological services – Juvenile Court must don the
robes of a correction home for a deviant child – Furthermore,
since the need for taking care of a juvenile in conflict with law is
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Union of India and Another

mandated by the Constitution, the role of the constitutional Courts

is significant – Even after the dismissal of a Special Leave Petition/
Statutory Criminal Appeal followed by incidental proceedings before
Supreme Court, where the plea of juvenility was not consciously
considered, there would be no bar on the constitutional Courts
to consciously take a deeper look – It is not an exercise of the
powers conferred u/Arts 32, 136 or 226, but an act in fulfilment of
a mandated duty enjoined upon the Courts, to give effect to the
laudable objective of a social welfare legislation – Constitution of
India, 1950 – Arts. 14, 15(3), 39(e), 39(f), 45, 47. [Paras 8-11, 23]

Juvenile Justice (Care And Protection Of Children) Act,

2015 – s.9(2) – Special homes – Plea of juvenility vis-à-vis
final disposal – Words “even after the final disposal of the
case” in s.9(2) – Significance:
Held: s. 9(2) being the heart and soul of the entire Act, must
be given its fullest meaning and interpretation – If the offence
is committed by a child, it cannot be treated otherwise than as
provided under the 2015 Act – After finding out the truth, necessary
consequences must follow – Sufficient opportunities must be given
to the child in conflict with law to get the benefit of the 2015 Act –
Merely because a casual adjudication has taken place does not
mean that a plea of juvenility cannot be raised subsequently – So
long as the right of a party subsists, one can never say that finality
has been attained – In a case where a plea has been raised, but
not adjudicated upon, the decision rendered thereunder would not
amount to attaining finality – In a case where the plea was not
treated as an application u/s.9(2) and, the procedure mandated
thereunder was not followed, the principle stated would apply as
right of raising the plea of juvenility has not ceased and, thus,
subsists. [Paras 21-22]

Juvenile Justice (Care and Protection of Children) Rules,

2007 – r.12, 12(3) – Procedure to be followed in determination
of age – Hierarchy of documents:
Held: While there is no difficulty in the application of the principal
Act inclusive of the procedural part, even for a juvenile in conflict
with law who has attained majority on or after 2001, r.12 must
be applied retrospectively even to those cases, especially where
no exercise was undertaken under any of the State Rules or the
erstwhile Acts, on earlier occasions – Sub-rule (3) of r.12 is a rule
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of evidence, which merely provides a hierarchy of documents in

the order of priority, to be taken note of and considered while
determining the age of a juvenile in conflict with law, in an ongoing
inquiry – Where a matriculation certificate is very much available,
a date of birth certificate from the school or a birth certificate given
by a local authority shall never be looked into – Only if none of the
said documents is available, can one go for a medical opinion – It
should not be misunderstood that even in those cases where due
inquiry was undertaken under the erstwhile enactments and the
relevant rules, one can seek a fresh inquiry u/r.12. [Paras 24-25]

Juvenility – Juvenility as an admitted fact – Rules of Evidence:

Held: Admission is a rule of evidence, it is a relevant fact – It
becomes relevant qua a fact in issue – When an admission is clear,
unambiguous, continuous and unequivocal, it becomes the best
form of evidence, and transforms itself into fact in issue – When
a party makes an admission, either by way of oral statement or
acknowledging a document authored by them, the Court must
proceed on that basis – Resultant relief, which is axiomatic, cannot
be denied on anvil of procedural law – Any contra view would
result in grave injustice – On an issue where there is no dispute,
denying a rightful relief would be an affront to fair play and justice –
However, the Court cannot construe a statement as an admission
and proceed on that basis – There is a subtle difference between
an unequivocal admission as against a statement which could be
construed to be so – Former can be the basis for a relief, latter
meant for adjudication vis-a-vis the facts of the case. [Para 27]

Maxim – Actus curiae neminem gravabit – Meaning:

Held: No one shall be prejudiced by an act of the Court – Mistake
committed by the Court cannot stand in the way of one’s rightful
benefit – It is not the party which commits a mistake, but rather the
Court itself – Such a mistake cannot act as a barrier for the party
to get its due relief – However, mistake must be so apparent that it
does not brook any adjudication on the foundational facts. [Para 28]

Constitution of India – Arts. 72, 161 – Power of the President

and the Governor to grant pardon – Presidential order –
Judicial review:
Held: Power of pardon u/Art.72 and 161 is sovereign – It is power
of compassion and empathy, meant to remove or reduce all pains,
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penalties and punishment suffered by a convict – Exercise of

this sovereign power by either the State or the Centre, is a final
grace given under the Constitution for the convict to reintegrate
into the society – Power u/Art.72 and 161 is not appellate or
revisional in nature, it is an executive power travelling on a
different channel – Challenge to the exercise of power u/Arts. 72
and 161 would involve limited judicial review – Courts will have
to exercise adequate caution and circumspection while dealing
with an executive order passed in exercise of the power conferred
u/Arts. 72 or 161 – When challenge is made to executive order,
with an independent prayer for exercising the power u/s.9(2),
they being distinct and independent, refusal of judicial review of
the former will not obliterate the mandatory duty pertaining to the
latter. [Paras 29-32]

Case Law Cited

Jasraj Inder Singh v. Hemraj Multanchand [1977] 2 SCR 973 :
(1977) 2 SCC 155; Mohan Singh v. State of M.P. [1999] 1
SCR 276 : (1999) 2 SCC 428; Shanmugam v. Ariya Kshatriya
Rajakula Vamsathu Madalaya Nandhavana Paripalanai Sangam
[2012] 4 SCR 74 : (2012) 6 SCC 430; Maria Margarida Sequeria
Fernandes v. Erasmo Jack De Sequeira [2012] 3 SCR 841 :
(2012) 5 SCC 370; Sugandhi v. P. Rajkumar (2020) 10 SCC 706;
Munna Pandey v. State of Bihar [2023] 11 SCR 1005 : 2023 SCC
OnLine SC 1103; Aruna Ramachandra Shanbaug v. Union of India
[2011] 4 SCR 1057 : (2011) 4 SCC 454; Pratap Singh v. State of
Jharkhand [2005] 1 SCR 1019 : (2005) 3 SCC 551; Jethanand
and Sons v. State of Uttar Pradesh [1961] 3 SCR 754 : 1961
SCC OnLine SC 193 : AIR 1961 SC 794; Mohan Lal Magan Lal
Thacker v. State of Gujarat [1968] 2 SCR 685 : 1967 SCC OnLine
SC 137 : AIR 1968 SC 733; Lily Thomas v. Union of India [2000]
3 SCR 1081 : (2000) 6 SCC 224; A.R. Antulay v. R.S. Nayak
[1988] Supp. 1 SCR 1 : (1988) 2 SCC 602; Kehar Singh v. Union
of India [1988] Supp. 3 SCR 1102 : (1989) 1 SCC 204; State
of Haryana v. Jagdish [2010] 3 SCR 716 : (2010) 4 SCC 216;
Shatrughan Chauhan v. Union of India [2014] 1 SCR 609 : (2014)
3 SCC 1; Ram Narain v. State of Uttar Pradesh [2015] 9 SCR
200 : (2015) 17 SCC 699; Hari Dutt Sharma v. The State of Uttar
Pradesh, Order of the Supreme Court dated 07.02.2022 in Writ
Petition (Crl.) 367 of 2021; Hari Ram v. State of Rajasthan [2009]
7 SCR 623 : (2009) 13 SCC 211; Abdul Razzaq v. State of Uttar
Pradesh (2015) 15 SCC 637; T Barai v. Henry Ah Hoe and Another
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[1983] 1 SCR 905 : (1983) 1 SCC 177; Ram Deo Chauhan v.

Bani Kanta Das [2010] 15 SCR 957 : (2010) 14 SCC 209; Vinay
Sharma v. Union of India [2020] 10 SCR 393 : (2020) 4 SCC 391;
Pawan Kumar Gupta v. State (NCT of Delhi) [2020] 4 SCR 1055 :
(2021) 13 SCC 249 – referred to.
United Australia Limited v. Barclay’s Bank Ltd [1941] A.C. 1 –
referred to.

List of Acts
Constitution of India; Juvenile Justice Act, 1986 (Act No. 53 of
1986); Juvenile Justice (Care and Protection of Children) Act, 2000
(Act No. 56 of 2000); Juvenile Justice (Care and Protection of
Children) Act, 2015 (Act No. 2 of 2016); Juvenile Justice (Care and
Protection of Children) Rules, 2007; Code of Criminal Procedure,
1973; Right to Information Act, 2005.

List of Keywords
Plea of juvenility; Special homes; Juvenility; Birth certificate issued
by School; Review Petition; Mercy Petition before the Governor;
Mercy Petition before Hon’ble the President of India; Ossification
test; Medical Age Certificate; Presidential Order; Death sentence;
Life imprisonment; Curative Petition; Executive order; Social
welfare legislation; State Legal Services Authority; Rehabilitation
and reintegration into the society upon release; Right to livelihood,
shelter and sustenance guaranteed u/Art.21; Justice delivery system;
Concept of truth; Duty of Court; Procedural law; Substantive law;
Judicial system; Juvenile justice; Rights of juvenile; Role of juvenile
courts; Role of Constitutional Courts; Deviant behaviour of a child;
Inequality; Environment; Plea of juvenility vis-à-vis final disposal;
Even after the final disposal of the case; Determination of age;
Hierarchy of documents; Matriculation certificate; Birth certificate
from school; Birth certificate by local authority; Juvenility as an
admitted fact; Rules of Evidence; Maxim; Actus curiae neminem
gravabit; Power of the President to grant pardon; Power of the
Governor to grant pardon; Presidential order; Judicial review; United
Nations Standard Minimum Rules for the Administration of Juvenile
Justice, 1985; United Nations Rules for the Protection of Juveniles
Deprived of their Liberty, 1990; Hague Convention on Protection of
Children and Cooperation in respect of Intercountry Adoption, 1993.
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Case Arising From

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
4229 of 2024
From the Judgment and Order dated 23.08.2019 of the High Court
of Uttarakhand at Nainital in WPCRL No. 1531 of 2017

Appearances for Parties

Dr. S. Muralidhar, Sr. Adv., Prateek K Chadha, Ms. Ninni Susan
Thomas, M.A. Karthik, Maitreya Subramaniam, Ms. Pallak Bhagat,
Yash S Vijay, Ms. Sakshi Jain, Ms. Pooja B Mehta, Sreekar Aechuri,
Aniket Chauhaan, Arjun Nayyar, Advs. for the Appellant.
K M Nataraj, A.S.G., Shailesh Madiyal, Sr. Adv., Digvijay Dam,
Raghav Sharma, Ms. Mrinal Elker Mazumdar, Vinayak Sharma,
Arvind Kumar Sharma, Ms. Vanshaja Shukla, Ms. Ankeeta Appanna,
Ms. Rachna Gandhi, Siddhant Yadav, Advs. for the Respondents.

Judgment / Order of the Supreme Court

Judgment

M. M. Sundresh, J.

1. Heard the Learned Senior Counsel Dr. S. Muralidhar for the Appellant,
and Learned Additional Solicitor General Mr. K.M. Nataraj and Learned
Counsel Ms. Vanshaja Shukla for the Respondents. We have also
carefully perused the written arguments along with the documents,
filed by both the sides in respect of their respective contentions.
2. We are dealing with a case where grave injustice has been
perpetrated, on account of the consistent failure on part of the judicial
machinery to recognise and act upon the constitutional mandate vis-
a-vis the plea of juvenility. Lord Atkin’s words of wisdom in United
Australia Limited v. Barclay’s Bank Ltd., [1941] A.C. 1 at p.29
become relevant in the aforementioned context:
“…When these ghosts of the past stand in the
path of justice clanking their medieval chains the
proper course for the judge is to pass through them
undeterred.”
(emphasis supplied)
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3. We are further reminded of the words of V.R. Krishna Iyer J., on the
laudable ideals of truth and justice in Jasraj Inder Singh v. Hemraj
Multanchand (1977) 2 SCC 155:-
“8. ...Truth, like song, is whole and half-truth can be
noise; Justice is truth, is beauty and the strategy of
healing injustice is discovery of the whole truth and
harmonising human relations. Law’s finest hour is
not in meditating on abstractions but in being the
delivery agent of full fairness. This divagation is
justified by the need to remind ourselves that the
grammar of justice according to law is not little
litigative solution….”
(emphasis supplied)

TRUTH AND THE COURT

4. Justice is nothing but a manifestation of the truth. It is truth which
transcends every other action. The primary duty of a Court is to make
a single-minded endeavour to unearth the truth hidden beneath the
facts. Thus, the Court is a search engine of truth, with procedural
and substantive laws as its tools.
5. When procedural law stands in the way of the truth, the Court must
find a way to circumvent it. Similarly, when substantive law, as it
appears, does not facilitate the emergence of the truth, it is the
paramount duty of the Court to interpret the law in light of its teleos.
Such an exercise is warranted in a higher degree, particularly while
considering a social welfare legislation.
6. In its journey, the Court must discern the truth, primarily from the
material available on record in the form of pleadings, and arguments
duly supported by documents. It must be kept in mind that the entire
judicial system is meant for the discovery of the truth, it being the
soul of a decision. For doing so, a Presiding Officer is expected to
play an active role, rather than a passive one.
7. We shall now place on record the views expressed and judgments
rendered on the concept of truth. Justice V.R. Krishna Iyer, at the 18th
Annual Conference of the American Judges Association at Seattle,
Washington State. (1979) 1 SCC J-7, stated thus-
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“Our profession is totally committed to Justice—

individual, social and spiritual. Truth, holistic truth,
is the basis of Justice and thus the great question
of history, What is Justice, is also the perennial
interrogation, What is Truth? Once we awaken to this
profound core, our attitude to pathological crime and
therapeutic punishment, to inner harmony and societal
peace, will be transformed into a high pursuit of truth
beyond “the madding crowd’s ignoble strife.”…
xxx xxx xxx
…The progressive manifestation of the divinity in man
is the recognition of the dignity and worth of the human
person and this curative process is the healing hope of
decriminalization—not stone walls nor iron bars nor other
subtle barbarities. This know-how of humanization alone
can dissolve the dilemma.”
(emphasis supplied)
Mohan Singh v. State of M.P. (1999) 2 SCC 428
“11. …Efforts should be made to find the truth, this is
the very object for which courts are created. To search
it out, the courts have been removing the chaff from
the grain. It has to disperse the suspicious cloud and
dust out the smear of dust as all these things clog the
very truth. So long as chaff, cloud and dust remain,
the criminals are clothed with this protective layer to
receive the benefit of doubt. So it is a solemn duty of
the courts, not to merely conclude and leave the case
the moment suspicions are created. It is the onerous
duty of the court, within permissible limit, to find out
the truth.…”
(emphasis supplied)
Shanmugam v. Ariya Kshatriya Rajakula Vamsathu Madalaya
Nandhavana Paripalanai Sangam (2012) 6 SCC 430
“Entire journey of a Judge is to discern the truth
24. The entire journey of a Judge is to discern the
truth from the pleadings, documents and arguments
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of the parties. Truth is the basis of the justice delivery

system….”
(emphasis supplied)
Maria Margarida Sequeria Fernandes v. Erasmo Jack De
Sequeira (2012) 5 SCC 370
“33. The truth should be the guiding star in the entire
judicial process. Truth alone has to be the foundation
of justice. The entire judicial system has been created
only to discern and find out the real truth. Judges at
all levels have to seriously engage themselves in the
journey of discovering the truth. That is their mandate,
obligation and bounden duty. Justice system will
acquire credibility only when people will be convinced
that justice is based on the foundation of the truth.
xxx xxx xxx

44. Malimath Committee on Judicial Reforms heavily

relied on the fact that in discovering truth, the Judges
of all courts need to play an active role. The Committee
observed thus:
‘2.2. … In the adversarial system truth is supposed
to emerge from the respective versions of the facts
presented by the prosecution and the defence before
a neutral Judge. The Judge acts like an umpire to see
whether the prosecution has been able to prove the
case beyond reasonable doubt….
xxx xxx xxx

…The Judge in his anxiety to maintain his position of

neutrality never takes any initiative to discover truth.
He does not correct the aberrations in the investigation
or in the matter of production of evidence before court.
xxx xxx xxx

2.15. The adversarial system lacks dynamism because it

has no lofty ideal to inspire. It has not been entrusted with a
positive duty to discover truth as in the inquisitorial system.
When the investigation is perfunctory or ineffective,
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Judges seldom take any initiative to remedy the

situation. During the trial, the Judge does not bother if
relevant evidence is not produced and plays a passive
role as if he has no duty to search for truth….
xxx xxx xxx

2.16.9. Truth being the cherished ideal and ethos of

India, pursuit of truth should be the guiding star of the
criminal justice system. For justice to be done truth
must prevail. It is truth that must protect the innocent
and it is truth that must be the basis to punish the
guilty. Truth is the very soul of justice. Therefore,
truth should become the ideal to inspire the courts to
pursue. This can be achieved by statutorily mandating
the courts to become active seekers of truth. It is of
seminal importance to inject vitality into our system
if we have to regain the lost confidence of the people.
Concern for and duty to seek truth should not become
the limited concern of the courts. It should become
the paramount duty of everyone to assist the court
in its quest for truth.”
(emphasis supplied)
Sugandhi v. P. Rajkumar (2020) 10 SCC 706
“9. It is often said that procedure is the handmaid of
justice. Procedural and technical hurdles shall not be
allowed to come in the way of the court while doing
substantial justice. If the procedural violation does
not seriously cause prejudice to the adversary party,
courts must lean towards doing substantial justice
rather than relying upon procedural and technical
violation. We should not forget the fact that litigation
is nothing but a journey towards truth which is the
foundation of justice and the court is required to take
appropriate steps to thrash out the underlying truth in
every dispute. Therefore, the court should take a lenient
view when an application is made for production of the
documents under sub-rule (3).”
(emphasis supplied)
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Munna Pandey v. State of Bihar, 2023 SCC OnLine SC 1103

“68. The role of a judge in dispensation of justice after
ascertaining the true facts no doubt is very difficult one.
In the pious process of unravelling the truth so as
to achieve the ultimate goal of dispensing justice
between the parties the judge cannot keep himself
unconcerned and oblivious to the various happenings
taking place during the progress of trial of any case.
No doubt he has to remain very vigilant, cautious,
fair and impartial, and not to give even a slightest of
impression that he is biased or prejudiced either due
to his own personal convictions or views in favour of
one or the other party. This, however, would not mean
that the Judge will simply shut his own eyes and be
a mute spectator, acting like a robot or a recording
machine to just deliver what stands feeded by the
parties.
xxx xxx xxx

70. This Court has condemned the passive role played

by the Judges and emphasized the importance and
legal duty of a Judge to take an active role in the
proceedings in order to find the truth to administer
justice and to prevent the truth from becoming a
casualty….”
(emphasis supplied)

JUVENILE JUSTICE
8. A child is a product of the present, in need of being moulded, to
thrive in the future. Therefore, deviant behaviour of a child in conflict
with law should be a concern of the society as a whole. One must
not lose sight of the fact that the child is not responsible for an act
of crime, but is rather victimized by it. Such a child is nothing but
an inheritor of crime, a legacy which it does not wish to imbibe. The
behaviour of a child can be attributed, possibly to two counts, namely,
the environment that the child grows in, and genetics. On the second
count, there is abundant research and literature available. However,
we do not wish to venture much into this, particularly in light of the
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innumerable permutations and combinations that could arise out of

the interaction between these two counts.
9. On the first count, various factors such as socio-economic, political
and cultural background, and life experience, amongst others, become
relevant. Thus, remedial measures may be employed for the benefit
of the child. Since the child does not choose the environment in
which it grows, deviant behaviour which is a result of exposure to
a given environment is evidence of rampant inequality. Therefore,
a child who lives in such a discriminatory environment, requires
equitable treatment on the touchstone of Article 14 of the Constitution
of India, 1950 (hereinafter referred to as “the Constitution”).
Article 15(3) read with Article 39 (e) and (f), Article 45 and Article 47
of the Constitution, in the form of the Fundamental Rights and the
Directive Principles of State Policy, emphasise on the need for special
care for children. The relevant provisions in the Constitution which
form the foundation of juvenile justice are as under:

Article 15 of the Constitution

“15. Prohibition of discrimination on grounds of
religion, race, caste, sex or place of birth.—
xxx xxx xxx
(3) Nothing in this article shall prevent the State from
making any special provision for women and children.”
(emphasis supplied)
Article 39 of the Constitution
“39. Certain principles of policy to be followed by
the State.—The State shall, in particular, direct its policy
towards securing—
(a) that the citizens, men and women equally, have the
right to an adequate means to livelihood;
(b) that the ownership and control of the material resources
of the community are so distributed as best to subserve
the common good;
(c) that the operation of the economic system does
not result in the concentration of wealth and means of
production to the common detriment;
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(d) that there is equal pay for equal work for both men
and women;
(e) that the health and strength of workers, men and
women, and the tender age of children are not abused
and that citizens are not forced by economic necessity
to enter avocations unsuited to their age or strength;
(f) that children are given opportunities and facilities
to develop in a healthy manner and in conditions of
freedom and dignity and that childhood and youth are
protected against exploitation and against moral and
material abandonment.”
(emphasis supplied)

Article 45 of the Constitution

“45. Provision for early childhood care and education
to children below the age of six years.—The State
shall endeavour to provide early childhood care and
education for all children until they complete the age
of six years.”
(emphasis supplied)
10. In view of the said constitutional mandate, the Court is expected to
play the role of parens patriae by treating a child not as a delinquent,
but as a victim, viewed through the lens of reformation, rehabilitation
and reintegration into the society.
11. Thus, a Juvenile Court is a species of a parent. A delinquent, who
appears before the Court, is to be protected and re-educated, rather
than be judged and punished. It is for this purpose, that the Court will
have to press into service the benevolent provisions for rehabilitation
introduced by the Legislature. A Juvenile Court assumes the role of
an institution rendering psychological services. It must forget that it
is acting as a Court, and must don the robes of a correction home
for a deviant child. In Aruna Ramachandra Shanbaug v. Union of
India (2011) 4 SCC 454, this Court recognised the need for Courts
to assume the role of parens patriae and stated thus:
“86. …As stated by Balcombe, J. in J. (A Minor ) (Wardship:
Medical Treatment), In re [(1990) 3 All ER 930 (CA)],
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the Court as representative of the Sovereign as

parens patriae will adopt the same standard which
a reasonable and responsible parent would do. The
parens patriae (father of the country) jurisdiction was
the jurisdiction of the Crown, which, as stated in Airedale
[1993 AC 789 : (1993) 2 WLR 316 : (1993) 1 All ER 821
(CA and HL)], could be traced to the 13th century. This
principle laid down that as the Sovereign it was the
duty of the King to protect the person and property
of those who were unable to protect themselves.
The Court, as a wing of the State, has inherited the
parens patriae jurisdiction which formerly belonged
to the King.
xxx xxx xxx

Doctrine of parens patriae

126. The doctrine of parens patriae (father of the country)
had originated in British law as early as in the 13th century.
It implies that the King is the father of the country and is
under obligation to look after the interest of those who are
unable to look after themselves. The idea behind parens
patriae is that if a citizen is in need of someone who
can act as a parent who can make decisions and
take some other action, sometimes the State is best
qualified to take on this role.
127. In the Constitution Bench decision of this Court in
Charan Lal Sahu v. Union of India [(1990) 1 SCC 613]
the doctrine has been explained in some detail as follows:
(SCC p. 648, para 35)
“35. … In the ‘Words and Phrases’ Permanent
Edn., Vol. 33 at p. 99, it is stated that parens
patriae is the inherent power and authority of a
legislature to provide protection to the person
and property of persons non sui juris, such as
minor, insane, and incompetent persons, but
the words parens patriae meaning thereby ‘the
father of the country’, were applied originally
to the King and are used to designate the State
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referring to its sovereign power of guardianship

over persons under disability. Parens patriae
jurisdiction, it has been explained, is the right
of the sovereign and imposes a duty on [the]
sovereign, in public interest, to protect persons
under disability who have no rightful protector.
The connotation of the term parens patriae differs
from country to country, for instance, in England
it is the King, in America it is the people, etc. The
Government is within its duty to protect and to
control persons under disability.”
(emphasis in original)
The duty of the King in feudal times to act as parens
patriae (father of the country) has been taken over in
modern times by the State.
128. In Heller v. DOE [125 L Ed 2d 257 : 509 US 312
(1992)] Mr Kennedy, J. speaking for the US Supreme
Court observed: (US p. 332)
“ ‘… the State has a legitimate interest under its
parens patriae powers in providing care to its
citizens who are unable … to care for themselves’
[Ed.: As observed in Addington v. Texas, 441 US
418 at p. 426.]”.
129. In State of Kerala v. N.M. Thomas [(1976) 2 SCC
310 : 1976 SCC (L&S) 227 : (1976) 1 SCR 906], SCR at
p. 951 Mr Mathew, J. observed: (SCC p. 343, para 64)
“64. … the Court also is ‘State’ within the meaning
of Article 12 (of the Constitution)….”
130. In our opinion, in the case of an incompetent
person who is unable to take a decision whether to
withdraw life support or not, it is the Court alone,
as parens patriae, which ultimately must take this
decision, though, no doubt, the views of the near
relatives, next friend and doctors must be given due
weight.”
(emphasis supplied)
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JUVENILE JUSTICE LEGISLATIONS IN INDIA:

THE JUVENILE JUSTICE ACT, 1986 (Act No. 53 of 1986)

12. We now touch upon the first Central enactment introduced way back
in the year 1986, in the form of the Juvenile Justice Act, 1986 (Act
No. 53 of 1986) (hereinafter referred to as the “1986 Act”). This was
the maiden attempt by the Central Legislature for a comprehensive
and uniform set of national rules for juveniles, recognising the need
to treat them separately from adults. The term ‘Juvenile’ has been
defined under Section 2(h) of the 1986 Act as under:
Section 2(h)
“2. Definitions.—In this Act, unless the context otherwise
requires-
xxx xxx xxx

(h) “juvenile” means a boy who has not attained the age
of sixteen years or a girl who has not attained the age of
eighteen years”
13. Though the 1986 Act did not specifically take into consideration the
mandate of the Constitution, the Legislature’s concern for juveniles
is evident from its provisions, including Section 32 of the 1986 Act,
which made it obligatory on the part of the Competent Authority to
make due inquiry as to the age of the person brought before it.
Section 32
“32. Presumption and determination of age.—(1) Where
it appears to a competent authority that a person brought
before it under any of the provisions of this Act (otherwise
than for the purpose of giving evidence) is a juvenile, the
competent authority shall make due inquiry as to the
age of that person and for that purpose shall take
such evidence as may be necessary and shall record a
finding whether the person is a juvenile or not, stating
his age as nearly as may be.
(2) No order of a competent authority shall be deemed
to have become invalid merely by any subsequent proof
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that the person in respect of whom the order has been

made is not a juvenile, and the age recorded by the
competent authority to be the age of the person so
brought before it shall, for the purposes of this Act,
be deemed to be the true age of that person.”
(emphasis supplied)

JUVENILE JUSTICE (CARE AND PROTECTION OF CHILDREN)

ACT, 2000 (Act No. 56 of 2000)
14. A much more comprehensive and modern exercise undertaken by
the Central Legislature, taking due note of Article 15(3), clauses (e)
and (f) of Article 39, Article 45 and Article 47 of the Constitution,
mandating stakeholders to ensure that all the needs of children
are fulfilled by elevating them to the status of basic human rights,
is the enactment of the Juvenile Justice (Care and Protection of
Children) Act, 2000 (Act No. 56 of 2000) (hereinafter referred to as
the “2000 Act”). While doing so, certain ideas were borrowed from
international conventions and covenants including the United Nations
Standard Minimum Rules for the Administration of Juvenile
Justice, 1985 (hereinafter referred to as “the Beijing Rules”), and
the United Nations Rules for the Protection of Juveniles Deprived
of their Liberty, 1990, amongst other instruments. Section 2(k) and
2(l) of the 2000 Act as amended by Act No. 33 of 2006 defines a
juvenile as under:

Section 2 (k) and (l)

“2. Definitions- In this Act, unless the context otherwise
requires-
xxx xxx xxx

(k) “juvenile” or “child” means a person who has not

completed eighteenth year of age;
(l) “juvenile in conflict with law” means a juvenile who
is alleged to have committed an offence and has not
completed eighteenth year of age as on the date of
commission of such offence.”
(emphasis supplied)
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The differential age qualification for boys and girls, in order to be

treated as juveniles, as was prevalent under the 1986 Act, was rightly
done away with in the 2000 Act.
15. The 2000 Act consciously made itself applicable to all pending
cases, both procedurally and substantively, which has in turn given
it an element of retrospectivity. One clear omission in the 2000 Act
is the absence of a specific duty upon the Investigating Agency
qua a juvenile during investigation, which was highlighted under
the Beijing Rules.

Rule 6 of the Beijing Rules

“6 – Scope of discretion
6.1 In view of the varying special needs of juveniles as well
as the variety of measures available, appropriate scope
for discretion shall be allowed at all stages of proceedings
and at the different levels of juvenile justice administration,
including investigation, prosecution, adjudication and the
follow-up of dispositions.”
16. Section 7A, along with the Explanation to Section 20 of the 2000
Act, were introduced into the statute by an amendment vide Act
No. 33 of 2006, to overcome the ratio of the judgment rendered by
the Constitution Bench of this Court in Pratap Singh vs. State of
Jharkhand (2005) 3 SCC 551, wherein it was declared that the benefit
of juvenility cannot be extended to a person who had completed 18
years of age as on 01.04.2001 – i.e. the date of enforcement of the
2000 Act.

Section 7A
“7A. Procedure to be followed when claim of juvenility
is raised before any Court.-
(1) Whenever a claim of juvenility is raised before any court
or a court is of the opinion that an accused person was
a juvenile on the date of commission of the offence, the
Court shall make an inquiry, take such evidence as may
be necessary (but not an affidavit) so as to determine the
age of such person, and shall record a finding whether
the person is a juvenile or a child or not, stating his age
as nearly as may be:
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Provided that a claim of juvenility may be raised before

any court and it shall be recognised at any stage, even
after final disposal of the case, and such claim shall
be determined in terms of the provisions contained
in this Act and the rules made thereunder, even if the
juvenile has ceased to be so on or before the date of
commencement of this Act.
(2) If the Court finds a person to be a juvenile on the date
of commission of the offence under sub-section (1), it shall
forward the juvenile to the Board for passing appropriate
order, and the sentence, if any, passed by a court shall
be deemed to have no effect.”
(emphasis supplied)

Section 20
“20. Special provision in respect of pending cases-
Notwithstanding anything contained in this Act, all
proceedings in respect of a juvenile pending in any Court
in any area on the date on which this Act comes into force
in that area, shall be continued in that Court as if this Act
had not been passed and if the Court finds that the juvenile
has committed an offence, it shall record such finding and
instead of passing any sentence in respect of the juvenile,
forward the juvenile to the Board which shall pass orders
in respect of that juvenile in accordance with the provisions
of this Act as if it had been satisfied on inquiry under this
Act that a juvenile has committed the offence:
Provided that the Board may, for any adequate and special
reason to be mentioned in the order, review the case and
pass appropriate order in the interest of such juvenile.
Explanation. In all pending cases including trial,
revision, appeal or any other criminal proceedings
in respect of a juvenile in conflict with law, in any
court, the determination of juvenility of such a juvenile
shall be in terms of clause (l) of section 2, even if
the juvenile ceases to be so on or before the date of
commencement of this Act and the provisions of this
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Act shall apply as if the said provisions had been in

force, for all purposes and at all material times when
the alleged offence was committed.”
(emphasis supplied)
17. While Section 7A of the 2000 Act deals with the procedure to be
followed when a claim of juvenility is raised before any Court,
Section 20 of the 2000 Act is a special provision in respect of pending
cases. Under both these provisions, it has been made abundantly clear
that the 2000 Act and the relevant rules would also be applicable to
a juvenile who ceased to be so on or before the commencement of
the 2000 Act. Thus, a retrospective application has been facilitated
under the 2000 Act.

JUVENILE JUSTICE (CARE AND PROTECTION OF CHILDREN)

ACT, 2015 (Act No. 2 of 2016)
18. The Juvenile Justice (Care and Protection of Children) Act, 2015
(Act No. 2 of 2016) (hereinafter referred to as the “2015 Act”) is an
improved version of the earlier legislations. The Hague Convention
on Protection of Children and Cooperation in respect of Inter-
country Adoption, 1993, has also been factored into. The 2015
Act undertook the exercise of classifying offences into different
categories. It defines the word ‘Court’ under Section 2(23), as one
having original jurisdiction. This definition is only illustrative in nature,
in tune with the importance of the enactment.
Section 2
“2. Definitions- In this Act, unless the context otherwise
requires:
xxx xxx xxx

(23) “court” means a civil court, which has jurisdiction in

matters of adoption and guardianship and may include
the District Court, Family Court and City Civil Courts;”
19. Thus, any Court which is competent to decide the issue of juvenility
would come within the purview of the definition clause, which
includes both the appellate and the revisional forums as well as the
Constitutional Courts. In other words, every Court of competence
shall assume the role of a Juvenile Court. We say so as, giving
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effect to the provisions of the 2015 Act is imperative in view of the

constitutional mandate.

Section 5
“5. Placement of person, who cease to be a child
during process of inquiry-Where an inquiry has been
initiated in respect of any child under this Act, and during
the course of such inquiry, the child completes the age of
eighteen years, then, notwithstanding anything contained
in this Act or in any other law for the time being in force,
the inquiry may be continued by the Board and orders may
be passed in respect of such person as if such person
had continued to be a child.”

Section 6
“6. Placement of persons, who committed an offence,
when person was below the age of eighteen years-
(1) Any person, who has completed eighteen years of age,
and is apprehended for committing an offence when he
was below the age of eighteen years, then, such person
shall, subject to the provisions of this section, be treated
as a child during the process of inquiry.
(2) The person referred to in sub-section (1), if not released
on bail by the Board shall be placed in a place of safety
during the process of inquiry.
(3) The person referred to in sub-section (1) shall be
treated as per the procedure specified under the provisions
of this Act.”
Sections 5 and 6 of the 2015 Act reiterate the principle
that even a juvenile who has attained majority during the
course of inquiry should be treated as a juvenile.
20. Section 9 of the 2015 Act is the very substance of the entire enactment
and sub section (2) is pari materia to Section 7A of the 2000 Act.

Section 9
“9. Procedure to be followed by a Magistrate who has
not been empowered under this Act-
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(1). When a Magistrate, not empowered to exercise the

powers of the Board under this Act is of the opinion that
the person alleged to have committed the offence and
brought before him is a child, he shall, without any delay,
record such opinion and forward the child immediately
along with the record of such proceedings to the Board
having jurisdiction.
(2) In case a person alleged to have committed an
offence claims before a court other than a Board, that
the person is a child or was a child on the date of
commission of the offence, or if the court itself is of
the opinion that the person was a child on the date of
commission of the offence, the said court shall make an
inquiry, take such evidence as may be necessary (but
not an affidavit) to determine the age of such person,
and shall record a finding on the matter, stating the
age of the person as nearly as may be:
Provided that such a claim may be raised before any
court and it shall be recognised at any stage, even
after final disposal of the case, and such a claim shall
be determined in accordance with the provisions
contained in this Act and the rules made thereunder
even if the person has ceased to be a child on or
before the date of commencement of this Act.
(3) If the court finds that a person has committed an
offence and was a child on the date of commission of such
offence, it shall forward the child to the Board for passing
appropriate orders and the sentence, if any, passed by
the court shall be deemed to have no effect.
(4) In case a person under this section is required to be
kept in protective custody, while the person’s claim of being
a child is being inquired into, such person may be placed,
in the intervening period in a place of safety.”
(emphasis supplied)
Under sub-section (2), it is the fundamental duty of the Court to
make an inquiry, and take such evidence as may be necessary
for the purpose of determining the age of the person brought
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before it. The proviso to sub-section (2) is a rather interesting

one. In fact, this proviso throws some light on the main provision,
giving an extended leverage to the plea of juvenility. Thus,
the plea of juvenility can be raised before any Court, meaning
thereby that there is no question of finality in this regard until
and unless an application filed, invoking this provision, is
determined in accordance with the 2015 Act and the relevant
rules. When such a plea is raised, it shall be recognised and
cannot be brushed aside in a casual or whimsical manner. A
due determination must be made by judiciously considering the
material available on record. The Court is expected to travel
an extra mile to satisfy its conscience as to whether the case
on hand would attract the provisions of the 2015 Act and, for
the aforesaid purpose, the process enumerated thereunder will
have to be necessarily followed. The proviso further clarifies
that the 2015 Act and the relevant rules are applicable even
if a person who has been accused of an offence, has ceased
to be a child on or before the date of the commencement of
the 2015 Act.

PLEA OF JUVENILITY VIS-A-VIS ‘FINAL DISPOSAL’

21. We place emphasis on the words “even after the final disposal of
the case” in Section 9(2) of the 2015 Act. As stated, this provision
being the heart and soul of the entire Act, must be given its fullest
meaning and interpretation. If the offence is committed by a child, it
cannot be treated otherwise than as provided under the 2015 Act.
After finding out the truth, necessary consequences must follow.
In a country like ours, where society is fragmented due to various
reasons including, but not limited to illiteracy and poverty, the role
which is assigned to the Court assumes great significance. Sufficient
opportunities must be given to the child in conflict with law to get
the benefit of the 2015 Act.
22. Merely because a casual adjudication has taken place, it does not
mean that a plea of juvenility cannot be raised subsequently. This
is for the simple reason that the plea of juvenility has not attained
finality. So long as the right of a party subsists, one can never say
that finality has been attained. In a case where a plea has been
raised, but not adjudicated upon, the decision rendered thereunder
would not amount to attaining finality. Likewise, when such a plea is
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not treated as one under Section 9(2) of the 2015 Act in compliance
with the procedural mandate specified thereunder, an order rejecting
such a plea would not be termed as a final one. To put it differently,
even assuming a plea of juvenility was raised but not considered
appropriately at the time of disposal of a Special Leave Petition/
Statutory Criminal Appeal, a Review Petition, or a Curative Petition
thereafter, it would not bar a competent Court from deciding the
said issue by following due procedure. We make it clear that if an
adjudication is based on due determination, then there may not be
any room for another round of litigation. But, in a case where the
plea was not treated as an application under Section 9(2) of the 2015
Act and, the procedure mandated thereunder was not followed, the
principle as aforesaid would certainly apply as the right of raising the
plea of juvenility has not ceased and, therefore, subsists.
23. Since the need for taking care of a juvenile in conflict with law is
mandated by the Constitution, the role of the constitutional Courts
is significant. Even after the dismissal of a Special Leave Petition/
Statutory Criminal Appeal followed by incidental proceedings
before this Court, where the plea of juvenility was not consciously
considered, there would be no bar on the constitutional Courts to
consciously take a deeper look. Doing so is not an exercise of the
powers conferred under Articles 32, 136 or 226 of the Constitution,
but an act in fulfilment of a mandated duty enjoined upon the Courts,
to give effect to the laudable objective of a social welfare legislation.
We shall now place on record the views expressed and judgments
rendered on the aspect of finality, and why a different view can be
taken by this Court, notwithstanding its earlier decision, in exercise
of the powers conferred under the Constitution:

Jethanand and Sons v. State of Uttar Pradesh, 1961 SCC

OnLine SC 193 : (1961) 3 SCR 754 : AIR 1961 SC 794
“7. In our view, the order remanding the cases under
Section 151 of the Civil Procedure Code is not a judgment,
decree or final order within the meaning of Article 133 of
the Constitution. By its order, the High Court did not decide
any question relating to the rights of the parties to the
dispute. The High Court merely remanded the cases for
retrial holding that there was no proper trial of the petitions
filed by the appellants for setting aside the awards. Such
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an order remanding the cases for retrial is not a final order

within the meaning of Article 133(1)(c). An order is final
if it amounts to a final decision relating to the rights
of the parties in dispute in the civil proceeding. If after
the order, the civil proceeding still remains to be tried
and the rights in dispute between the parties have to
be determined, the order is not a final order within the
meaning of Article 133….”
(emphasis supplied)

Mohan Lal Magan Lal Thacker v. State of Gujarat, 1967

SCC OnLine SC 137 : (1968) 2 SCR 685 : AIR 1968 SC 733
“4. The question as to whether a judgment or an order
is final or not has been the subject-matter of a number
of decisions; yet no single general test for finality
has so far been laid down. The reason probably is that
a judgment or order may be final for one purpose and
interlocutory for another or final as to part and interlocutory
as to part. The meaning of the two words “final” and
“interlocutory” has, therefore, to be considered separately
in relation to the particular purpose for which it is required.
However, generally speaking, a judgment or order
which determines the principal matter in question is
termed final. It may be final although it directs enquiries
or is made on an interlocutory application or reserves
liberty to apply [Halsbury’s Laws of England (3rd Edn.)
Vol. 22, 742-43]. In some of the English decisions where
this question arose, one or the other of the following
four tests was applied.
1. Was the order made upon an application such that
a decision in favour of either party would determine
the main dispute?
2. Was it made upon an application upon which the
main dispute could have been decided?
3. Does the order as made determine the dispute?
4. If the order in question is reversed, would the action
have to go on?”
(emphasis supplied)
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Lily Thomas v. Union of India (2000) 6 SCC 224

“56. It follows, therefore, that the power of review can be
exercised for correction of a mistake but not to substitute
a view. Such powers can be exercised within the limits of
the statute dealing with the exercise of power. The review
cannot be treated like an appeal in disguise. The mere
possibility of two views on the subject is not a ground for
review. Once a review petition is dismissed no further
petition of review can be entertained. The rule of law of
following the practice of the binding nature of the larger
Benches and not taking different views by the Benches
of coordinated jurisdiction of equal strength has to be
followed and practised. However, this Court in exercise
of its powers under Article 136 or Article 32 of the
Constitution and upon satisfaction that the earlier
judgments have resulted in deprivation of fundamental
rights of a citizen or rights created under any other
statute, can take a different view notwithstanding the
earlier judgment.”
(emphasis supplied)

HIERARCHY OF DOCUMENTS
24. Rule 12 of the Juvenile Justice (Care and Protection of Children)
Rules, 2007 (hereinafter referred to as the “2007 Rules”) must be
understood and appreciated in tune with the principal Act.

Rule 12 of the 2007 Rules

“12. Procedure to be followed in determination of age.
xxx xxx xxx

(3) In every case concerning a child or juvenile in conflict

with law, the age determination inquiry shall be conducted
by the court or the Board or, as the case may be, the
Committee by seeking evidence by obtaining-
(a)(i) the matriculation or equivalent certificates, if
available; and in the absence whereof;
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(ii) the date of birth certificate from the school (other

than a play school) first attended; and in the absence
whereof;
(iii) the birth certificate given by a corporation or a
municipal authority or a panchayat;
(b)and only in the absence of either (i), (ii) or (iii) of
clause (a) above, the medical opinion will be sought
from a duly constituted Medical Board, which will
declare the age of the juvenile or child. In case exact
assessment of the age cannot be done, the Court or
the Board or, as the case may be, the Committee,
for the reasons to be recorded by them, may, if
considered necessary, give benefit to the child or
juvenile by considering his/her age on lower side
within the margin of one year.
and, while passing orders in such case shall, after taking
into consideration such evidence as may be available,
or the medical opinion, as the case may be, record a
finding in respect of his age and either of the evidence
specified in any of the clauses (a)(i), (ii), (iii) or in the
absence whereof, clause (b) shall be the conclusive
proof of the age as regards such child or the juvenile in
conflict with law.”
While there is no difficulty in the application of the principal Act
inclusive of the procedural part, even for a juvenile in conflict
with law who has attained majority on or after 01.04.2001, Rule
12 of the 2007 Rules must be applied retrospectively even to
those cases, especially where no exercise was undertaken
under any of the State Rules or the erstwhile Acts, on earlier
occasions.
25. Sub-rule (3) of Rule 12 is nothing but a rule of evidence. It merely
provides a hierarchy of documents in the order of priority, to be
taken note of and considered while determining the age of a juvenile
in conflict with law, in an ongoing inquiry. Sub-rule (3), apart from
making a reference to specified documents, debars resorting to the
subsequently mentioned document, except in a case where the earlier
document(s) is/are not available. Therefore, where a matriculation
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certificate is very much available, a date of birth certificate from the

school or a birth certificate given by a local authority shall never be
looked into. Only if none of the aforementioned three documents
is available, can one go for a medical opinion. While interpreting
this Rule, we make it clear that it should not be misunderstood that
even in those cases where due inquiry was undertaken under the
erstwhile enactments and the relevant rules, one can seek a fresh
inquiry under Rule 12 of the 2007 Rules.
26. Section 94(2) of the 2015 Act is a reiteration of Rule 12 of the 2007
Rules, and both should be read in consonance with each other.

Section 94 of the 2015 Act

“94. Presumption and Determination of age
xxx xxx xxx

(2) In case, the Committee or the Board has reasonable

grounds for doubt regarding whether the person brought
before it is a child or not, the Committee or the Board,
as the case may be, shall undertake the process of age
determination, by seeking evidence by obtaining —
(i) the date of birth certificate from the school, or
the matriculation or equivalent certificate from the
concerned examination Board, if available; and in
the absence thereof;
(ii) the birth certificate given by a corporation or a
municipal authority or a panchayat;
(iii) and only in the absence of (i) and (ii) above, age
shall be determined by an ossification test or any other
latest medical age determination test conducted on
the orders of the Committee or the Board:
Provided such age determination test conducted on the
order of the Committee or the Board shall be completed
within fifteen days from the date of such order.”

JUVENILITY AS AN ADMITTED FACT

27. Admission is a rule of evidence. It is a relevant fact. It becomes
relevant qua a fact in issue. When an admission is clear, unambiguous,
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continuous and unequivocal, it becomes the best form of evidence,

and transforms itself into a fact in issue. When a party makes an
admission, either by way of an oral statement or by acknowledging
a document authored by them, the Court must proceed on that
basis. The resultant relief, which is axiomatic, cannot be denied on
the anvil of procedural law. Any contra view would result in grave
injustice. On an issue where there is no dispute, denying a rightful
relief would be an affront to fair play and justice. Here, we may add
a word of caution. The Court cannot construe a statement as an
admission and proceed on that basis. There is a subtle difference
between an unequivocal admission as against a statement which
could be construed to be so. It must be seen contextually. While
the former can be the basis for a relief, the latter is one meant for
adjudication vis-a-vis the facts of the case.

ACTUS CURIAE NEMINEM GRAVABIT

28. No one shall be prejudiced by an act of the Court. A mistake
committed by the Court cannot stand in the way of one’s rightful
benefit. It is not the party which commits a mistake, but rather the
Court itself. Hence, such a mistake cannot act as a barrier for the
party to get its due relief. However, we make it clear that the mistake
must be so apparent that it does not brook any adjudication on the
foundational facts.

A.R. Antulay v. R.S. Nayak (1988) 2 SCC 602

“82. Lord Cairns in Rodger v. Comptoir D’escompte De
Paris [(1869-71) LR 3 PC 465, 475 : 17 ER 120] observed
thus:
“Now, Their Lordships are of opinion, that one
of the first and highest duties of all courts is to
take care that the act of the court does no injury
to any of the suitors, and when the expression
‘the act of the court’ is used, it does not mean
merely the act of the primary court, or of any
intermediate court of appeal, but the act of the
court as a whole, from the lowest court which
entertains jurisdiction over the matter up to the
highest court which finally disposes of the case.
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It is the duty of the aggregate of those Tribunals,

if I may use the expression, to take care that no
act of the court in the course of the whole of the
proceedings does an injury to the suitors in the
court.”
83. This passage was quoted in the Gujarat High Court
by D.A. Desai, J., speaking for the Gujarat High Court in
Soni Vrajlal v. Soni Jadavji [AIR 1972 Guj 148 : (1972)
13 Guj LR 555] as mentioned before. It appears that in
giving directions on February 16, 1984, this Court acted
per incuriam inasmuch it did not bear in mind consciously
the consequences and the provisions of Sections 6 and 7
of the 1952 Act and the binding nature of the larger Bench
decision in Anwar Ali Sarkar case [1952 SCR 284 : AIR
1952 SC 75 : 1952 Cri LJ 510] which was not adverted to by
this Court. The basic fundamentals of the administration
of justice are simple. No man should suffer because
of the mistake of the court. No man should suffer a
wrong by technical procedure of irregularities. Rules
or procedures are the handmaids of justice and not the
mistress of the justice. Ex debito justitiac, we must do
justice to him. If a man has been wronged so long as
it lies within the human machinery of administration
of justice that wrong must be remedied. This is a
peculiar fact of this case which requires emphasis.”
(emphasis supplied)

JUDICIAL REVIEW OF THE PRESIDENTIAL ORDER

29. The power of pardon, as conferred under Article 72 and 161 of the
Constitution, is sovereign. It is a power of compassion and empathy.
It is meant to remove or reduce all pains, penalties and punishment
suffered by a convict. The exercise of the aforementioned sovereign
power by the highest constitutional authority, either of the State or the
Centre, is a final grace given under the Constitution for the convict
to reintegrate into the society.
30. Power under Article 72 and 161 of the Constitution is not appellate or
revisional in nature. It is an executive power travelling on a different
channel, which cannot be termed as a power of appeal or review.
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31. A challenge to the exercise of power under Article 72 and 161 of the
Constitution would involve limited judicial review on grounds such
as inadequate application of mind, amongst others.

Kehar Singh v. Union of India (1989) 1 SCC 204

“10. We are of the view that it is open to the President in
the exercise of the power vested in him by Article 72 of
the Constitution to scrutinise the evidence on the record
of the criminal case and come to a different conclusion
from that recorded by the court in regard to the guilt of,
and sentence imposed on, the accused. In doing so, the
President does not amend or modify or supersede the
judicial record. The judicial record remains intact, and
undisturbed. The President acts in a wholly different
plane from that in which the Court acted. He acts
under a constitutional power, the nature of which is
entirely different from the judicial power and cannot
be regarded as an extension of it….”
(emphasis supplied)

State of Haryana v. Jagdish (2010) 4 SCC 216

“28. Nevertheless, we may point out that the power of
the sovereign to grant remission is within its exclusive
domain and it is for this reason that our Constitution
makers went on to incorporate the provisions of Article
72 and Article 161 of the Constitution of India. This
responsibility was cast upon the executive through
a constitutional mandate to ensure that some public
purpose may require fulfilment by grant of remission in
appropriate cases. This power was never intended to be
used or utilised by the executive as an unbridled power
of reprieve. Power of clemency is to be exercised
cautiously and in appropriate cases, which in effect,
mitigates the sentence of punishment awarded and
which does not, in any way, wipe out the conviction.
It is a power which the sovereign exercises against
its own judicial mandate. The act of remission of the
State does not undo what has been done judicially.
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The punishment awarded through a judgment is not

overruled but the convict gets benefit of a liberalised
policy of State pardon….”
(emphasis supplied)

Shatrughan Chauhan v. Union of India (2014) 3 SCC 1

“242. In the aforesaid batch of cases, we are called upon
to decide on an evolving jurisprudence, which India has to
its credit for being at the forefront of the global legal arena.
Mercy jurisprudence is a part of evolving standard of
decency, which is the hallmark of the society.
xxx xxx xxx

244. It is well established that exercising of power under

Articles 72/161 by the President or the Governor is a
constitutional obligation and not a mere prerogative.
Considering the high status of office, the Constitution
Framers did not stipulate any outer time-limit for
disposing of the mercy petitions under the said Articles,
which means it should be decided within reasonable
time. However, when the delay caused in disposing
of the mercy petitions is seen to be unreasonable,
unexplained and exorbitant, it is the duty of this Court
to step in and consider this aspect. Right to seek for
mercy under Articles 72/161 of the Constitution is a
constitutional right and not at the discretion or whims
of the executive. Every constitutional duty must be
fulfilled with due care and diligence, otherwise judicial
interference is the command of the Constitution for
upholding its values.
245. Remember, retribution has no constitutional
value in our largest democratic country. In India,
even an accused has a de facto protection under
the Constitution and it is the Court’s duty to shield
and protect the same. Therefore, we make it clear
that when the judiciary interferes in such matters,
it does not really interfere with the power exercised
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under Articles 72/161 but only to uphold the de facto

protection provided by the Constitution to every
convict including death convicts.”
(emphasis supplied)
32. Suffice it is to state that Courts will have to exercise adequate
caution and circumspection while dealing with an executive order
passed in exercise of the power conferred under Article 72 or 161
of the Constitution. We make it clear that when a challenge is made
to an executive order, with an independent prayer for exercising the
power under Section 9(2) of the 2015 Act, they being distinct and
independent, refusal of judicial review of the former will not obliterate
the mandatory duty pertaining to the latter.

FACTUAL MATRIX
33. The Appellant stood charged for the offence of culpable homicide
amounting to murder. The incident occurred way back on 15.11.1994.
A statement under Section 313 of the Code of Criminal Procedure,
1973 (hereinafter referred to as “CrPC, 1973”) was recorded by the
trial Court. Under the format of the statement, the Appellant gave
his name, his father’s name, his age and other particulars. He had
given his age as 20 years, as on 07.03.2001. In reply to Question
No. 26, he stated that it was correct that he had opened a bank
account and that a cheque book had been issued. This statement
is irrelevant in the context of juvenility.
34. After his conviction, he raised the plea of juvenility during the
hearing on sentence by stating that he was about 17 years of age
at the time of occurrence. It is not in dispute that he was illiterate.
The trial Court, while relying upon his statement regarding the
bank account, presumed that he was a major and sentenced him
to death, overwhelmed by the nature of the crime. On an appeal
to the High Court, the Appellant was represented by an Amicus
Curiae. An attempt was again made to raise the plea of juvenility,
by stating that the Appellant was required to be tried by a Juvenile
Court and be given the benefit of being a juvenile. Once again, the
bank account and the cheque book were relied upon. In tune with
the thinking of the trial Court, the High Court was also persuaded
by the offence committed.
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35. The matter reached this Court. This time, the Appellant placed reliance
upon the birth certificate issued by the Dariya Para Bodinath Board
School dated 28.04.2001. This Court, having found that the reasoning
of the High Court cannot be faulted with, dismissed the appeal.
Thus, the views expressed by the trial Court and confirmed by the
High Court were duly concurred with. Undeterred and undaunted,
the Appellant filed a Review Petition, reiterating the fact that he
was a minor at the time of the offence. It was also pointed out that
it was his deceased employer who filled the details to open the
bank account. The Review Petition was dismissed. After the said
dismissal, a Mercy Petition filed before the Governor of the State of
Uttarakhand, was also rejected.
36. Thereafter, a Writ Petition was filed before this Court, by the
Appellant’s parents along with a social worker, enclosing a copy of
the school certificate dated 19.06.2003 from the headmaster and a
transfer certificate dated 28.04.2001. This Writ Petition filed invoking
Article 32 of the Constitution, was dismissed on 16.02.2005 with
liberty to invoke the curative jurisdiction of this Court. Accordingly, a
Curative Petition was filed. It is interesting to note that by way of a
counter affidavit to the Curative Petition, Respondent No. 2 herein,
after verifying the school certificate, produced another certificate
dated 07.01.2006 issued by the Dariya Para Bodinath Board School,
which reiterated the fact that the Appellant was 14 years of age on
the date of the occurrence. Unfortunately, this Curative Petition was
also dismissed by an order of this Court dated 06.02.2006.
37. After the amendment incorporating Section 7A into the 2000 Act, the
Appellant’s mother filed a Mercy Petition before Hon’ble the President
of India. During the pendency of the said Mercy Petition, the 2007
Rules, came into effect. Incidentally, an ossification test was also
done by a Medical Board constituted by the Meerut Jail, on a request
made by the Appellant by way of an application. The Medical Age
Certificate issued therein also indicated that the Appellant was aged
around 14 years at the time of the occurrence.
38. By the Presidential Order dated 08.05.2012, the death sentence
of the Appellant was commuted to life imprisonment, with a caveat
that he shall not be released until the attainment of 60 years of age.
An application under the Right to Information Act, 2005 was filed
thereafter by the Appellant, through which information was obtained
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from the bank that any minor above 10 years of age can have an
independent bank account, provided he knew how to read and write,
and also that no cheque book was issued for the bank account
opened in the name of the Appellant.
39. A subsequent Curative Petition filed by him was rejected by the
Registry as not maintainable. In the year 2019, the Appellant filed
a Writ Petition before the High Court invoking Article 226 of the
Constitution, laying a challenge to the Presidential Order while seeking
yet another relief on the basis of Section 9(2) of the 2015 Act. By
a comprehensive judgment, the Writ Petition was dismissed by the
High Court inter alia holding that the power of judicial review over an
executive order passed in exercise of Article 72 of the Constitution
is limited, and the proceedings against the Appellant had attained
finality. Suffice it is to state that merits were not gone into in view of
the clear stand of the State on the age of the Appellant. Aggrieved,
the Appellant is before us.

SUBMISSIONS
40. Dr. S. Muralidhar, learned Senior Counsel appearing for the Appellant
submitted that the High Court committed an error in not considering
the independent prayer sought for by the Appellant. It is not in
dispute that the age of the Appellant was 14 years at the time of
commission of the offence. There is no judicial finality attained and
the phrase “any stage” used in Section 9(2) of the 2015 Act must
be given an extended meaning. There is no contrary finding given
against the Appellant vis-à-vis the plea of juvenility, which he has
raised at every stage. It is a case where grave injustice has been
meted out, as can be demonstrated by the lack of adjudication
and, therefore, the Appellant is entitled for immediate release. As
the Appellant has been unfairly kept under incarceration including
the earlier solitary confinement, which is obviously untenable and
illegal, while granting the relief of releasing the Appellant forthwith,
he should be adequately compensated for the loss of formative years
suffered by him in the prison.
41. To buttress his submissions, the Learned Senior Counsel has placed
reliance upon the following decisions:
(i). Section 9(2) of the Juvenile Justice Act, 2015 can be invoked
even after the final disposal of the case
[2025] 1 S.C.R.  399

Om Prakash @ Israel @ Raju @ Raju Das v.

Union of India and Another

• Ram Narain v. State of Uttar Pradesh (2015) 17 SCC 699.

• Hari Dutt Sharma v. The State of Uttar Pradesh, Order
of the Supreme Court dated 07.02.2022 in Writ Petition
(Crl.) 367 of 2021.
(ii). Beneficial and retrospective applicability of change in law
post the dismissal of the Curative Petition on 06.02.2006
• Hari Ram v. State of Rajasthan (2009) 13 SCC 211.
• Abdul Razzaq v. State of Uttar Pradesh (2015) 15 SCC 637.
• T Barai v. Henry Ah Hoe and another (1983) 1 SCC 177.
(iii). Claim of juvenility can be raised and considered even
after the President has exercised powers under Article 72,
Constitution of India
• Kehar Singh v. Union of India (1989) 1 SCC 204.
• Ram Deo Chauhan v. Bani Kanta Das (2010) 14 SCC 209.
42. Per contra, Mr. K.M. Nataraj, learned Additional Solicitor General, and
learned Counsel Ms. Vanshaja Shukla appearing for the Respondents
submitted that this is an attempt to reopen and re-hear an issue which
has attained finality. There was indeed an adjudication by this Court
on the earlier occasion. The Mercy Petition was considered under
the constitutional mandate and, therefore, it does not require any
interference. The Special Leave Petition, as filed, is not maintainable.
The bone ossification test cannot be the sole basis for declaring the
appellant as the minor. While summing up, the Learned Additional
Solicitor General submitted that without prejudice to the other
contentions, if this Court comes to the aid of the Appellant, it should
be clarified that it shall not stand as a precedent. In any case, there
is due compliance of Rule 12(3) of the 2007 Rules, which is not in
dispute, as can be seen even from the present affidavit filed by the
Respondent No.2.
43. To buttress her submissions, the Learned Counsel for Respondent
No. 2 has placed reliance upon the following decisions:
• Vinay Sharma v. Union of India (2020) 4 SCC 391.
• Pawan Kumar Gupta v. State (NCT of Delhi) (2021) 13 SCC 249.
400 [2025] 1 S.C.R.

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DISCUSSION
44. During the course of the hearing, we directed Respondent No.2
to obtain fresh instructions on the admission made in the counter
affidavit filed by it in the Curative Petition filed earlier by the Appellant.
This was pertaining to the certificate produced by the Appellant
and the validity of the ossification test. An affidavit has been filed
by Respondent No. 2 reiterating its earlier stand as regards the
certificate. Therefore, on facts, there is no dispute that the Appellant
was only 14 years old at the time of the commission of the offence.
45. The facts as narrated above, speak for themselves. At every stage,
injustice has been inflicted by the Courts, either by ignoring the
documents or by casting a furtive glance. The Appellant despite
being illiterate, raised this plea one way or another, right from the trial
Court up to the conclusion of the Curative Petition before this Court.
46. The approach of the Courts in the earlier round of litigation cannot
be sustained in the eye of law. There can be no reliance on the
statement recorded under Section 313 of CrPC, 1973 particularly
when the Appellant was asked to give his particulars for the purpose
of recording his statement. Even the said statement shows that he
was 20 years of age at the time of making his deposition, which
could only mean that he was 14 years of age at the time of the
commission of the offence. The bank account has no relevance
under the Acts and the relevant rules, and in any case, it is to be
proved, though not contemplated under Rule 12 of the 2007 Rules.
The statement given by the Appellant at the time of the hearing on
his sentence, would also pale into insignificance, as even then he
would have been a minor at the time of commission of the offence,
under both the 2000 and the 2015 Acts.
47. Though the 2000 Act was already enacted before the Appellant’s
conviction, even assuming that only the 1986 Act was in vogue, the
procedural mandate contemplated thereunder was also not followed
by the trial Court and the High Court. Before this Court, the Appellant
had relied upon the school certificate in the Criminal Appeal. It was
once again relied upon in the Review Petition. Thereafter, additional
documents were relied upon by the Appellant in the Writ Petition and
also in the Curative Petition which was subsequently filed. In the
Curative Petition, a counter affidavit was filed by the State certifying
[2025] 1 S.C.R.  401

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Union of India and Another

the documents furnished by the Appellant to be true. Nonetheless,

the said petition was dismissed without according any reason.
48. We are taking note of these facts only for the purpose of dealing with
the case as these discussions are not even relevant in view of the
clear statement in writing made on two occasions by the Respondent
No. 2. We may further add that even the then existing State Rules
were not duly followed, and if followed, the same would have enured
to the benefit of the Appellant.
49. We would only say that when the plea of juvenility was raised, it
should have been dealt with under the existing laws at the relevant
point of time, especially when there exists a tacit and clear admission
as to the age of the Appellant. In fact, there is no need for such
an inquiry in view of the aforesaid position. In our considered view,
this Court could have dealt with the Writ Petition filed under Article
32 of the Constitution, as it raised an independent prayer for the
enforcement of a right conferred under a social welfare legislation.
50. In the subsequent Writ Petition filed before the High Court, two
different prayers had been made, namely, the determination of the
Appellant’s plea of juvenility and consequent release, or alternatively,
judicial review of the decision of the President or the Governor and
consequent release. As the Executive cannot be construed to have
undertaken an adjudication on the determination of the age of the
accused, and with the first prayer being a distinct one invoking Section
9(2) of the 2015 Act, we feel that the High Court has committed an
error in its reasoning. We would only state that this is a case where
the Appellant has been suffering due to the error committed by the
Courts. We have been informed that his conduct in the prison is
normal, with no adverse report. He lost an opportunity to reintegrate
into the society. The time which he has lost, for no fault of his, can
never be restored.
51. As we find that the Appeal deserves to be allowed in view of the
conclusion arrived at, we are inclined to set aside the sentence
imposed in excess of the upper limit prescribed under the relevant
Act, while maintaining the conviction rendered. It cannot be construed
that the Presidential Order is interfered with, as the issue that we
are concerned with, is the failure of the Court in not applying the
mandatory provisions of the 2015 Act with specific reference to the
plea of juvenility. Therefore, it is not a review of the Presidential
402 [2025] 1 S.C.R.

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Order, but a case of giving the benefit of the provisions of the 2015
Act to a deserving person.
52. From the custody certificate filed on record, it appears that the
Appellant has undergone imprisonment for almost 25 years, during
which time, the society has undergone significant transformation which
the Appellant might be unaware of and find difficult to adjust with.
53. In view of the same, we direct the Uttarakhand State Legal Services
Authority (for short “the State Authority”) to play a proactive role
in identifying any welfare scheme of the State/Central Government,
facilitating the Appellant’s rehabilitation and smooth reintegration into
the society upon his release, with particular emphasis on his right
to livelihood, shelter and sustenance guaranteed under Article 21 of
the Constitution. We further direct the State Authority to assist him
in availing any such scheme under which he is found eligible and
wishes to avail, and such assistance may be effected through the
concerned District Legal Services Authority, if the State Authority
finds the same expedient and necessary. The Registry is directed
to forthwith communicate this order to the State Authority.
54. The Appeal is allowed. The impugned judgment stands set aside.
The sentence imposed against the Appellant in excess of the upper
limit prescribed under the relevant Act, shall stand set aside, while
making it clear that the conviction shall continue. The Appellant shall
be released forthwith, if not required in any other case.
55. Pending application(s), if any, shall stand disposed of.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Nidhi Jain
 [2025] 1 S.C.R. 403 : 2025 INSC 48

State of Uttar Pradesh and Another

v.
R.K. Pandey and Another
(Civil Appeal No. 10212 of 2014)
09 January 2025
[Sanjiv Khanna,* CJI, Sanjay Kumar and
R. Mahadevan, JJ.]

Issue for Consideration

Matter pertains to the enforceability of the ex-parte awards against
the employer-State Government and the principal of the medical
college, when the employer objected the authenticity of the
arbitration agreement relied on by the employee.

Headnotes†
Arbitration and Conciliation Act, 1996 – Ex-parte arbitral
awards – Enforcement by employee, when denial of the
authenticity of the arbitration agreement by employer – Service
dispute by the employee against the State Government and
the government hospital where he was employed as regards
age of superannuation – Writ petition remained pending for 12
years, thereafter was withdrawn – Year before, the employee
initiated arbitration proceedings against the State Government
and the principal of the medical college – Suit for reference
filed which was later withdrawn without any decision on merits
with the two sole arbitrators appointed by the employee, suo
moto taking up the arbitration proceedings and pronouncing
the two awards, for an amount of around Rs.46 lakhs with
interest against the State and the Principal of the Medical
College – Thereafter, employee sought enforcement of ex-parte
awards – Employer objected the authenticity of the arbitration
agreement relied on by employee – However, the courts below
dismissed the objections – Correctness:
Held: Arbitration agreement is sine qua non for arbitration
proceedings, as arbitration fundamentally relies on the principle of
party autonomy-right of parties to choose arbitration as an alternative
to court adjudication – Existence of the arbitration agreement is a
prerequisite for an award to be enforceable in the eyes of law –
* Author
404 [2025] 1 S.C.R.

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On facts, arbitration proceedings were a mere sham and a fraud

played by employee, by self-appointing/nominating arbitrators, who
have passed ex-parte and invalid awards – Clear case of lack of
subject matter jurisdiction – So-called arbitration agreement nowhere
available on the records of either the Municipal Corporation or the
State – Employee did not file the original agreement since he was
not in possession of the same, nor is he a signatory and party to the
arbitration agreement – Hospital and the Governor did not endorse
any such agreement – Arbitration Agreement is not referred to in
the indenture of the transfer executed – No evidence to show the
existence of the arbitration agreement, except a piece of paper,
which is not even a certified copy or authenticated copy of the official
records – Notwithstanding that the claims made by employee were
ex-facie and clearly barred by limitation as per s.3 of the Limitation
Act 1963 rw s.43 they have been allowed – Thus, ex parte awards
set aside and to be treated as null and void and non-enforceable
in law – Impugned judgment set aside. [Paras 20-25]

Case Law Cited

Bilkis Yakub Rasool v. Union of India and Others [2024] 1 SCR 743 :
(2024) 5 SCC 481; Central Organisation of Railway Electrification
v. ECI PIC SMO MCPL (JV), a Joint Venture Company, 2024 INSC
857 – referred to.

List of Acts
Arbitration and Conciliation Act, 1996; Code of Civil Procedure,
1908; Limitation Act 1963.

List of Keywords
Enforceability of ex-parte awards; Authenticity of the arbitration
agreement; Ex-parte arbitral awards; Age of superannuation;
Arbitration proceedings; Arbitration agreement; Lack of jurisdiction;
Certified copy or authenticated copy of official records; Unilateral
appointment of arbitrator by employee; Barred by limitation;
Jurisdiction; Execution proceedings.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 10212 of 2014
From the Judgment and Order dated 28.02.2012 of the High court
of Judicature at Allahabad in FAFO No. 352 of 2012
[2025] 1 S.C.R.  405

State of Uttar Pradesh and Another v. R.K. Pandey and Another

Appearances for Parties

Ankit Goel, Vikas Bansal, Nikhil Sharma, Advs. for the Appellants.
Mrs. Deepika Mishra, Abhishek Misra, Ms. Abha Jain, Jaivir Singh,
Advs. for the Respondents.

Judgment / Order of the Supreme Court

Judgment

Sanjiv Khanna, CJI

Delay condoned.
2. This appeal arises from an order dated 28.02.2012 passed by a
Division Bench of the High Court of Judicature at Allahabad in First
Appeal from Order Defective No. 352/2012.
3. The facts, in brief, are – Respondent no. 1, R.K. Pandey, was
appointed as a Lab Assistant/ Technician in the T.B. Section of Dina
Nath Parbati Bangla Infectious Disease1 Hospital located at Kanpur.
The Municipal Board of Kanpur set up this hospital on the land given
by the Kanpur Improvement Trust in 1944-45.
4. On 17.07.1956, DNPBID Hospital was taken over by the State
Government, that is, the Government of Uttar Pradesh, to establish
a new medical college at Kanpur pursuant to a Resolution dated
17.07.1956 passed by the Administrator of the Municipal Board of
Kanpur and six members of the Board of the hospital. On 29.03.1957,
the State Government accepted the proposal dated 17.07.1956.
5. On 20.06.1961, a transfer deed was executed between the Nagar
Mahapalika of the City of Kanpur and the Governor of the State of Uttar
Pradesh. The said deed has been placed on the record. It states that
in terms of the G.O. dated 29.03.1957, the entire municipal staff of the
hospital, as per the list attached to the indenture, will stand transferred
to the State Government service. The staff will not be unfavourably
placed as regards emoluments or other service conditions, nor shall
they suffer in the matter of emoluments, leave, age of retirement,
and other benefits as compared to the terms of service of the Board.

1 Hereinafter, “DNPBID.”
406 [2025] 1 S.C.R.

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6. After the settlement was executed, the hospital became a unit of

Ganesh Shanker Vidayarthi Memorial2 Medical College, Kanpur.
Thereupon, it is apparent that the employees working in DNPBID
Hospital opted for service under the State Government and had
sent their consent which was accepted. Thereafter, their service
records were sent to the State Government. It was agreed that the
concessions and privileges enjoyed by the staff before the aforesaid
hospital were provincialized and will continue in future and they will
not be put to a disadvantage by the take-over. The Board agreed to
pay Rs.50,000/- keeping in view the liability of the Municipal Board.
7. Vide letter dated 09.01.1997, the Chief Medical Superintendent of
the hospital, now a State Government hospital, informed Respondent
No. 1, R.K. Pandey that he would be superannuating on 31.03.1997.
He was requested to contact the office along with pension papers and
submit the same within one week so that the process can be initiated.
8. In March 1997, Respondent No. 1, R.K. Pandey, filed a writ petition
before the High Court of Judicature at Allahabad claiming that he
should retire at the age of 60 years instead of 58 years, relying upon
the service rules as applicable to the employees of the Municipal
Board of Kanpur.
9. Pursuant to the filing of the writ petition, Respondent No.1, R.K.
Pandey was directed to make a representation. While a representation
was indeed made, it was subsequently rejected observing that the
respondent had been in service of the State Government for 42
years and was availing all pay and allowances, as per the State
Government rules.
10. The State Government filed an affidavit opposing the writ petition inter
alia, stating that Respondent No. 1, R.K. Pandey, having acquired
the status of State Government service was bound and governed
by the rules and regulations of the State Government. It was also
stated that the minimum age for entering the government service is
18 years, and if a government servant retires at the age of 58 years,
he would have completed 40 years of service. In the present case,
Respondent No. 1, R.K. Pandey had completed service of 42 years
of service. In other words, he would be 60 years of age.

2 Hereinafter, “GVSM.”
[2025] 1 S.C.R.  407

State of Uttar Pradesh and Another v. R.K. Pandey and Another

11. No interim order was passed in the writ petition, which remained
pending till it was withdrawn by Respondent No. 1, R.K. Pandey
on 22.04.2009. Consequently, the prayers made in the writ petition
were not granted.
12. Notwithstanding the pendency of the writ petition, on 11.01.2008,
Respondent No. 1, R.K. Pandey, filed an arbitration suit before
the District Judge, Kanpur Nagar, Kanpur, relying upon an
alleged arbitration agreement dated 01.04.1957 between the then
Administrator of the DNBPID Hospital and the Governor of Uttar
Pradesh. The prayer sought was for the dispute regarding Respondent
No. 1, R.K. Pandey’s age of superannuation and the rejection of his
representation dated 03.04.1997 by the Principal of GVSM Medical
College be referred to arbitration. However, the arbitration agreement
was not mentioned either in the writ petition or in the application for
its withdrawal. Subsequently, on 15.02.2008, Respondent No. 1, R.K.
Pandey, withdrew the suit seeking to refer the disputes to arbitration.
13. On 29.11.2008, Respondent No. 1, R.K. Pandey, filed two execution
petitions before the District Judge in Kanpur, seeking to enforce two
separate ex parte awards issued on 15.02.2008 and 25.06.2008
by Advocates Pawan Kumar Tewari and Indivar Vajpayee. These
proceedings were initiated by Respondent No. 1 against the State
Government and the Principal of GSVM Medical College, Kanpur.
14. The first ex-parte award dated 15.02.2008 decreed the claim of
Respondent No. 1, R.K. Pandey for an amount of Rs.26,42,116/- with
interest at the rate of 18 % per annum from 21.01.2008 against the
State of Uttar Pradesh and the Principal GSVM Medical College,
Kanpur. The award states that Respondent No. 1, R.K. Pandey had
appointed/ nominated the Arbitrator and there was non-appointment
by the opposite party and, therefore, Pawan Kumar Tewari, Advocate
had acted as the sole Arbitrator.
15. The second ex parte Award dated 25.06.2008 passed by Indivar
Vajpayee awarded an amount of Rs.20,00,000/- along with interest
at the rate of 9% per annum with effect from 11.02.2008 in favour
of Respondent No. 1, R.K. Pandey, and against the opposite party,
viz. the State of Uttar Pradesh and the Principal of GSVM Medical
College, Kanpur. The Award states that Respondent No. 1 had
appointed Indivar Vajpayee as an Arbitrator on 25.06.2008, albeit the
opposite party had not appointed an Arbitrator and, hence Indivar
Vajpayee acted as the sole Arbitrator.
408 [2025] 1 S.C.R.

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16. The appellant on receiving notice in the execution petition filed viz.
the Award given by Indivar Vajpayee, filed objections against the two
awards under Section 34 of the Arbitration and Conciliation Act, 1996.3
One of the issues raised before the executing court concerned the
existence of the arbitration agreement, purportedly dated 01.04.1957,
which Respondent No. 1, R.K. Pandey, relied upon. This agreement
was claimed to have been executed and signed on behalf of the
Administrator of the Municipal Board and the Additional Secretary
of the Government of Uttar Pradesh.
17. The authenticity of this document was denied. Notably, this document
or the arbitration agreement is not reflected in the transfer deed
executed on 20.06.1961. Furthermore, the purported arbitration
agreement was neither mentioned in the writ petition filed by
Respondent No. 1, R.K. Pandey, in March 1997, nor referenced in
any correspondence or related documents until Respondent No. 1,
R.K. Pandey, filed a petition under Section 11 of the A&C Act, for
the appointment of an arbitrator on 11.01.2008. By this petition,
Respondent No. 1, R.K. Pandey, had prayed for the appointment
of an arbitrator. As recorded above, the said petition was dismissed
as withdrawn on 15.02.2008, which was also the date on which the
first award for Rs.20,00,000/- with interest at the rate of 18 % per
annum was passed by Pawan Kumar Tewari, Advocate. The second
Award by Indivar Vajpayee dated 25.06.2008 is also pursuant to the
appointment of an arbitrator by Respondent No. 1, R.K. Pandey
without recourse to court proceedings.
18. The objections filed by the appellants under Section 34 of the
A&C Act were dismissed by the trial court on the ground that
they were barred by limitation and had been filed beyond the
condonable period. Interestingly, during the pendency of the said
objections, a query had been raised as to the existence of the
arbitration agreement dated 01.04.1957, which was relied upon by
Respondent No. 1, R.K. Pandey. In a reply given by the Municipal
Corporation/Mahanagar Palika to the Advocate appointed by District
Government Counsel (Civil), Kanpur Nagar, it was stated that the
photocopy furnished of the agreement was not clear and there
was no such agreement available on the record. Hence, it was

3 Hereinafter, “A&C Act.”

[2025] 1 S.C.R.  409

State of Uttar Pradesh and Another v. R.K. Pandey and Another

not possible to verify the said document. The purported agreement

dated 01.04.1957 is not signed and executed by Respondent
No. 1, R.K. Pandey, and a copy of the agreement is not marked
to him. The authenticity of the agreement cannot be established
as it is not available on the record of the Municipal Board. The
State Government, as is evident, has denied the existence of any
such agreement.
19. The impugned judgment passed by the Division Bench of the High
Court of Judicature at Allahabad dismissed the intra court appeal on
the grounds that the objections itself were barred by limitation and
beyond the condonable period.
20. We have narrated the facts in detail as they are peculiar, and
intervention by this Court is necessary to prevent any attempt to
enforce the so-called awards, which are null and void ab initio for
several reasons. This Court in its decision in Bilkis Yakub Rasool
v. Union of India and Others,4 observes that fraud and justice
never dwell together, and a litigant should not be able to benefit
from a fraud practiced with an intention to secure him an illegal
benefit. In the present case, the so-called arbitration agreement is
nowhere available on the records of either the Municipal Corporation
or the State of Uttar Pradesh. Respondent No. 1, R.K. Pandey,
did not file the original agreement since he was not in possession
of the same, nor is he a signatory and party to the arbitration
agreement. An arbitration agreement is sine qua non for arbitration
proceedings, as arbitration fundamentally relies on the principle
of party autonomy; - the right of parties to choose arbitration as
an alternative to court adjudication. In this sense, ‘existence’ of
the arbitration agreement is a prerequisite for an award to be
enforceable in the eyes of law. No doubt, Section 7 of the A&C
Act, which defines the ‘arbitration agreement’, is expansive and
includes an exchange of statements of claim and defence in which
the existence of the agreement is alleged by one party and not
denied by the other party, albeit the existence of the arbitration
agreement is not accepted by either the Municipal Corporation or
the Appellant, the State of Uttar Pradesh. The Arbitration Agreement
is not referred to in the indenture of the transfer executed later

4 [2024] 1 SCR 743 : (2024) 5 SCC 481

410 [2025] 1 S.C.R.

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on 20.06.1961. There is no evidence to show the existence of the

arbitration agreement, except a piece of paper, which is not even
a certified copy or an authenticated copy of the official records.
How and from where RK Pandey, Respondent No. 1, got a copy
of the agreement, and that too nearly 10 years after his retirement
and filing of a writ petition remains unknown.
21. The arbitration agreement, as propounded, is between the Municipal
Corporation and Development Board, Kanpur, and the appellant, the
Governor of the State of Uttar Pradesh. For the sake of reference,
the arbitration agreement is reproduced:
“This Arbitration Agreement made on the First April,
One Thousand Nine Hundred Fifty Seven between the
Municipal and Development Board Kanpur (hereinafter
called the Board) of the one part and the Governor of
Uttar Pradesh (hereinafter, called the Government) of
the other part.
It is mutually agreed by the and between the parties as
follows:
All disputes or difference whatsoever which shall if any
time arise between the parties including the employees
of Provincialized DN Bangla I.D. Hospital, Kanpur,
hereto touching or concerning the resolution passed
by the Managing Committee of the said Hospital at the
meeting held on 17.07.1956, which was accepted by the
Government, shall be referred to the Arbitrators nominated
by the Principal GSVM Medical College, Kanpur and
the administrator of the Board or employees of the said
provincialized Hospital for arbitration under the Arbitration
Act. Any statutory modification of re-enactment thereof and
the rules made thereunder for the time being enforced
shall apply to the Arbitration proceedings. If one party
nominates the arbitrator and refers the dispute to the
nominated arbitrator for adjudication in writing notice to
the other party and the other party fails to nominate the
arbitrator within 10 days then the arbitrator nominated by
the First Party shall be final and act as a sole arbitrator.
The award of the arbitrators/sole arbitrator shall be final
and binding on the parties.
[2025] 1 S.C.R.  411

State of Uttar Pradesh and Another v. R.K. Pandey and Another

This agreement signed by the administrator on behalf of

the Board and the Additional Secretary of the Government
of UP on behalf of the Government.
M.A. Quraishi, I.C.C.
Administrator
Municipal & Development Board
Kanpur
G.P. Pandey, Addl. Secretary to the Govt. of UP”
The agreement postulates that each party, that is, the Municipal and
Development Board, Kanpur, and the Governor of Uttar Pradesh,
may nominate an arbitrator for adjudication by giving written notice
to the other party. In the event the other party fails to nominate an
arbitrator within ten days, the arbitrator nominated by the first party
shall act as the sole arbitrator. It was not the case of Respondent
No. 1, R.K. Pandey that the Municipal and Development Board,
Kanpur, or the Governor of Uttar Pradesh has invoked the arbitration
clause. The unilateral appointment of the arbitrator by Respondent
No. 1, R.K. Pandey is, therefore, contrary to the arbitration clause
as propounded by him.
22. Another intriguing aspect is the delay in relying on the arbitration
agreement and initiating arbitration proceedings. Respondent No. 1,
R.K. Pandey, himself filed the writ petition in 1997 concerning the
same dispute. The writ petition had remained pending till 22.04.2009,
when it was withdrawn. It is during the pendency of the petition,
that the steps for initiation of arbitration were taken on 11.01.2008
by Respondent No.1, R.K. Pandey, by filing a suit for reference in
terms of Section 11 of the A&C Act. However, the petition was later
withdrawn without any decision on merits with the two sole arbitrators
appointed by Respondent No. 1, R.K. Pandey, suo moto taking up
the arbitration proceedings and pronouncing the two awards, the
first dated 15.02.2008 for an amount of Rs.26,42,116/- with interest
at the rate of 18% per annum, and the second dated 25.06.2008
for an amount of Rs.20,00,000/- along with interest at the rate of
nine percent per annum with effect from 11.02.2008, against the
Appellants, the State of Uttar Pradesh and the Principal of GSVM
Medical College, Kanpur. Notwithstanding that the claims made by
Respondent No. 1, R.K. Pandey, were ex-facie and clearly barred
412 [2025] 1 S.C.R.

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by limitation as per Section 3 of the Limitation Act 1963 read with

Section 43 of the A&C Act, they have been allowed.
23. A 5-Judge Constitution Bench of this Court in Central Organisation
of Railway Electrification v. ECI PIC SMO MCPL (JV), a Joint
Venture Company 5 has observed that equity applies at the stage
of appointment of arbitrators, though the A&C Act recognizes
the autonomy of parties to decide on all aspects of arbitration.
The enactment lays down a procedural framework to regulate
the composition of the arbitral tribunal and conduct of arbitration
proceedings. It is only then that the arbitral tribunals, which have the
backing of courts, can act objectively and exercise their discretion
in a judicial manner, without caprice and in accordance with the
principles of law and rules of natural justice. This is the core of the
alternate dispute redressal mechanism, which is also the core of
Section 18 of the A&C Act and is a non-derogable and mandatory
provision. It is only then the arbitrators are vested with the power to
resolve the dispute under the law. This judgment also observed that
the unilateral appointment of arbitrators has a direct effect on the
conduct of arbitral proceedings. Arbitration, which is quasi-judicial,
requires a standard of behaviour of arbitrators, which is impartial
and independent, no less stringent than that demanded of judges. In
fact, arbitrators are expected to uphold a higher standard, as court
decisions are subject to the collective scrutiny of an appeal, while an
arbitration award typically enjoys greater acceptability, recognition,
and enforceability.
24. We have made our observations in the context of Section 47 of the
Code of Civil Procedure, 1908, which even at the stage of execution,
permits a party to object to the decree, both on the grounds of fraud,
as well as lack of subject matter jurisdiction. It is apparent that
the arbitration proceedings were a mere sham and a fraud played
by Respondent No.1, R.K. Pandey, by self-appointing/nominating
arbitrators, who have passed ex-parte and invalid awards. To reiterate,
Respondent No. 1, R.K. Pandey, is not a signatory to the purported
arbitration agreement. Moreover, the parties thereto, DNPBID
Hospital and the Governor of Uttar Pradesh, do not endorse any

5 2024 INSC 857

[2025] 1 S.C.R.  413

State of Uttar Pradesh and Another v. R.K. Pandey and Another

such agreement. From the cumulative facts and reasons elucidated

above, this is a clear case of lack of subject matter jurisdiction.
25. Accordingly, we allow the present appeal and set aside the two ex
parte Awards dated 15.02.2008 and 25.06.2008. Both the Awards
shall be treated as null and void and non-enforceable in law.
Resultantly, the judgment passed, and the subject matter of the
appeal shall be treated as set aside. The execution proceedings
shall stand dismissed. The appellants will be entitled to costs of the
entire proceedings as per the law.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Nidhi Jain
 [2025] 1 S.C.R. 414 : 2025 INSC 70

Dr. Sharmad
v.
State of Kerala and Others
(Civil Appeal No. 13422 of 2024)
10 January 2025
[Dipankar Datta* and Prashant Kumar Mishra, JJ.]

Issue for Consideration

Whether the High Court was justified in interfering with the order
granting promotion to the appellant to the post of Associate
Professor, Department of Neurosurgery, Medical Education Service,
Health and Family Welfare Department, Kerala on 06.02.2013.

Headnotes†
Service Law – Promotional appointment – Post-qualification
experience, when not required – Vacancy for the post of
Associate Professor arose on 13.11.2012 – Appellant had
acquired M.Ch degree on 31.07.2008 – Completed 5 years
as Assistant Professor on 30.07.2013 (was promoted as
Assistant Professor on 11.01.2007) – In the meanwhile,
he was Promoted as Associate Professor on 06.02.2013 –
Challenged by respondent no.3, application dismissed by
Kerala Administrative Tribunal – High Court set aside the
promotion of the appellant to the post of Associate Professor
holding that he lacked 5 years physical teaching experience
as Assistant Professor after acquiring the degree of M.Ch.–
Sustainability:
Held: Not sustainable, set aside – A plain and literal reading of
the G.O. dated 07.04.2008, the executive order governing the
recruitment in question does not show that 5 years’ experience of
physical teaching as an Assistant Professor after acquiring M.Ch.
degree was one of the requisite qualifications – The G.O., read as a
whole, evinces the view of the Government that where the experience
had to be gained posterior to the acquisition of qualification, it
had directly stated so – Government did not demand such post-
qualification experience for the posts under consideration – Although,
normally, experience gained after acquiring a particular qualification
could justifiably be insisted upon by the employer, there could be
* Author
[2025] 1 S.C.R.  415

Dr. Sharmad v. State of Kerala and Others

exceptions and the present case is one such exception – On the

date of occurrence of vacancy i.e. 13.11.2012, the appellant had
physical teaching experience of more than 5 years as Assistant
Professor (having joined on 11.01.2007) and thus was eligible, in
terms of the recruitment rules i.e., G.O. dated 07.04.2008 – High
Court erred in placing reliance on r.28(b)(1A) – Judgment of the
Tribunal restored – Impugned judgment in Civil Appeal No. 13423
of 2024 also set aside – Kerala State and Subordinate Services
Rules, 1958 – Note to r.28(b)(1A). [Paras 14, 26, 23, 29]

Kerala State and Subordinate Services Rules, 1958 – Part – II,

Rule 10(ab), Rule 10(a)(i) – Promotional appointments –
Whether Rule 10(ab) has application to the promotional
appointment in question – ‘Recruitment Rules’ if not defined,
can mean executive Government orders where Special Rules
are absent:
Held: ‘Recruitment Rules’ is used in Rule 10(ab) as an alternative
to Special Rules, without the same being defined – Without
‘Recruitment Rules’ being defined, it can take colour from Rule
10(a)(i) and mean and include executive orders of the Government
where Special Rules are absent – Even if the 1958 Rules were
applicable, nothing turns on it because Rule 10(ab) itself consciously
uses the expression “unless otherwise specified” – Rule 10 is
entirely irrelevant and immaterial for appointment on promotion in
the Administrative and Teaching Cadres of the Medical Education
Services – The recruitment rules, i.e., G.O. dated 07.04.2008 was
issued superseding all existing rules and orders in force on the
method of appointment of the faculties under medical education
service – The executive must, therefore, be deemed to be aware
of what the 1958 Rules, which are the general rules, provided–
Notwithstanding the same, G.O. dated 07.04.2008 was issued
governing recruitment in two branches i.e. Administrative and
Teaching Cadres – G.O. dated 07.04.2008 is, thus, a special rule
as distinguished from a general rule like the 1958 Rules – Thus, the
distinction in the qualifications for posts in Branch-I and Branch-II
in G.O. dated 07.04.2008 would constitute the specification which
is excluded from the purview of Rule 10(ab) and such rule had/
has no application to the promotional appointment in question.
[Paras 17-20]

Maxims – “expressio unius est exclusio alterius” – Whatever

has not been included has impliedly been excluded –
416 [2025] 1 S.C.R.

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Applicability – Exclusion of the words “after acquiring

postgraduate degree”, if was deliberate in recruitment rules,
i.e., G.O. dated 07.04.2008 for appointments on promotion to
posts in Branch II i.e. Teaching Cadre:
Held: Yes – In G.O. dated 07.04.2008, the words “after acquiring
postgraduate degree” were specifically included in the column
for experience qua eligibility criteria for appointment on the posts
of Director of Medical Education and Joint Director of Medical
Education/Principals of Medical Colleges, i.e., posts in Branch I
i.e. Administrative Cadre – If, indeed, it were the intention of the
executive that aspirants for the post of Associate Professor were
also required to have physical teaching experience in the feeder
posts for specified number of years “after acquiring postgraduate
degree”, it defies reason as to why the same qualification was not
included for appointments on promotion to posts borne in Branch II
i.e. Teaching Cadre but included for the posts borne in Branch I
i.e. Administrative Cadre. [Para 22]

Case Law Cited

Shesharao Jangluji Bagde v. Bhaiyya s/o Govindrao Karale,
1990 INSC 288 : [1990] Supp. 1 SCR 521 : (1991) Supp. 1 SCC
367 – referred to.
Arun Kumar Agarwal (Dr.) v. State of Bihar, 1991 INSC 115 :
[1991] 2 SCR 491 : (1991) Supp. 1 SCC 287; Indian Airlines Ltd.
v. S Gopalakrishnan, 2000 INSC 590 : [2000] Supp. 5 SCR 548 :
(2001) 2 SCC 362; Sirajudheen v. Public Service Commission,
1999 (1) LLN 408; Rabi v. State of Kerala, 2007 SCC OnLine
Ker 418; A. Basheer v. Saiful Islam A., 2014 SCC OnLine Ker
18469 – distinguished.

List of Acts
Kerala State and Subordinate Services Rules, 1958; Administrative
Tribunals Act, 1985.

List of Keywords
Promotional appointment; Post-qualification experience; Associate
Professor; Assistant Professor; Department of Neurosurgery;
Medical Education Service, Health and Family Welfare Department,
Kerala; 5 years physical teaching experience as Assistant Professor;
Degree of M.Ch.; Executive order; Requisite qualifications; Kerala
[2025] 1 S.C.R.  417

Dr. Sharmad v. State of Kerala and Others

Administrative Tribunal; Experience posterior to the acquisition

of qualification; Medical education service; Administrative and
Teaching Cadres, Branch-I and Branch-II; Recruitment rules; General
rules; Special rules; Specified number of years; “After acquiring
postgraduate degree”; Experience; Eligibility criteria; Feeder posts;
“Expressio unius est exclusio alterius”; Maxims; Lecturer; Senior
Lecturer; Paediatrics; Post Graduate (PG) qualification.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 13422 of 2024
From the Judgment and Order dated 20.01.2017 of the High Court
of Kerala at Ernakulam in O.P. No. 1360 of 2013
With
Civil Appeal No. 13423 of 2024

Appearances for Parties

V Giri, Sr. Adv., K. Rajeev, Rahul Narang, Ms. Niveditha R Menon,
Pranav Krishna, Aditya Verma, Tarun Kumar, Advs. for the Appellant.
V Chitambaresh, Sr. Adv., C. K. Sasi, Ms. Meena K Poulose,
M Gireesh Kumar, Ankur S. Kulkarni, Ms. Puspita Basak, Tarun,
Advs. for the Respondents.
Romy Chacko, Sr. Adv., Anup Kumar, Ashwin Romy, Mrs. Neha
Jaiswal, Ms. Shruti Singh, Ms. Pragya Chaoudhary, Akshat Singh,
Advs. for the Intervenor.

Judgment / Order of the Supreme Court

Judgment

Dipankar Datta, J.

CIVIL APPEAL NO. 13422 of 2024

1. This appeal, by special leave, carried by the appellant1 to this Court
takes exception to the judgment and order dated 20th January, 2017 of
a Division Bench of the High Court of Kerala at Ernakulam2 allowing

1 Dr. Sharmad
2 High Court
418 [2025] 1 S.C.R.

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a writ petition3 presented by the third respondent4. The High Court set
aside the judgment and order dated 15th March, 2013 of the Kerala
Administrative Tribunal at Thiruvananthapuram5, which dismissed
the original application6 of Dr. Jyothish filed under Section 19 of the
Administrative Tribunals Act, 1985 in limine.
2. A short question arises for decision in the appeal. It is, whether the
High Court was justified in interfering with the order granting promotion
to Dr. Sharmad to the post of Assistant Professor, Department of
Neurosurgery, Medical Education Service, Health and Family Welfare
Department, Kerala7 on 06th February, 2013.
3. For the purpose of a decision on this appeal, it would be appropriate
to note the respective profile of Dr. Sharmad and Dr. Jyothish. The
same is indicated in a tabular form hereunder:

Dr. Sharmad Dr. Jyothish

Appointed as Lecturer Appointed as Lecturer, with
(with MBBS) on 22.10.1999. M. Ch degree, on 09.03.2005.
Promoted as Assistant Professor Promoted as Assistant
on 11.01.2007. Professor on 22.07.2008.
Acquired M. Ch degree on -------
31.07.2008.
Completed 5 years on the post Completed 5 years on the
of Assistant Professor, after post of Assistant Professor on
acquisition of M. Ch degree, on 21.07.2013.
30.07.2013.
Promoted as Associate Promoted as Associate
Professor on 06.02.2013. Professor in May, 2023.
Promoted as Professor on Promoted as Professor on
09.05.2023. 11.11.2024.
To retire on 31.05.2029. To retire on 30.04.2031.

3 OP (KAT) No.1360 of 2013

4 Dr. Jyothish
5 Tribunal
6 OA 476 of 2013
7 the said post
[2025] 1 S.C.R.  419

Dr. Sharmad v. State of Kerala and Others

4. It is not in dispute that the vacancy on the said post of Associate

Professor, which is the bone of contention in this appeal, arose
on 13th November, 2012. For recruitment in the Medical Education
Service under the Health and Family Welfare Department, Govt. of
Kerala, rules under the proviso to clause (2) of Article 309 of the
Constitution of India have not been framed. However, recruitment
from time to time has been made in terms of Government Orders
issued by the relevant department. At the time of occurrence of the
vacancy on the said post of Assistant Professor, Government Order8
dated 07th April, 2008 was in force. It was issued in “supersession
of all existing rules and orders in force regarding qualification and
method of appointment of the faculties under Medical Education
Services”. The said G.O. provided qualifications for appointment in
Branch – I i.e. Administrative Cadre and Branch – II i.e. Teaching
Cadre. The discipline of neurosurgery was included under Head
‘C’ of Branch - II i.e. medical (super specialties). The categories of
faculties covered by the said G.O. were (i) Professor, (ii) Associate
Professor, and (iii) Assistant Professor.
5. Insofar as Branch – I i.e. Administrative Cadre is concerned, the same
bore two posts i.e. Director of Medical Education and Joint Director
of Medical Education/Principals of Medical Colleges. Under the
column experience, we find the requirement for appointment on the
posts of Director of Medical Education and Joint Director of Medical
Education/Principals to be common. The same reads as under:
“Minimum 10 years of Physical Teaching Experience in
Government Medical Colleges (under Medical Education
Department in Kerala) after acquiring postgraduate
degree”.
(emphasis supplied)
6. For recruitment and appointment on the posts of Professor, Associate
Professor and Assistant Professor, the educational qualifications
appear to be the same. An aspirant must have the degree of M. Ch
in Neurosurgery or DNB (Neurosurgery). The experience criteria
required for the said three posts, however, vary. The same are set
out hereunder:

8 G.O.
420 [2025] 1 S.C.R.

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Associate
Professor Assistant Professor
Professor
One year Physical Five years Physical Three years Physical
Teaching experience Teaching experience Teaching experience
as Associate Professor. as Assistant Professor. as Senior Lecturer/
Lecturer.
7. If the experience criteria required for appointment on the posts
under Branch - I i.e. – Administrative Cadre are juxtaposed with the
experience criteria required for appointment on the teaching posts
of Professor/Associate Professor/Assistant Professor, what stands
out is that in case of posts in the teaching cadre, the words “after
acquiring postgraduate degree” are conspicuous by its absence
under the column ‘experience’.
8. Dr. Jyothish claimed before the High Court that notwithstanding
absence of such words under the column experience for Branch - II i.e.
Teaching Cadre, the said requirement has to be read into it. Reference
was made by him to Rules 10 and 28, Part II of the Kerala State
and Subordinate Services Rules, 19589 to contend that Dr. Sharmad
did not possess the requisite experience to satisfy the mandatory
eligibility qualifications and was illegally appointed on promotion to the
said post of Associate Professor by the official respondents. On the
contrary, Dr. Sharmad claimed, in light of the criteria for experience
for appointment in Branch - I i.e. Administrative Cadre, that it is not
the requirement of G.O. dated 07th April, 2008 that an aspirant ought
to have 5 (five) years physical teaching experience as an Assistant
Professor (regular) after acquiring postgraduate degree. In such view
of the matter, the official respondents did not commit any illegality in
promoting Dr. Sharmad as an Associate Professor even before efflux
of 5 (five) years since acquisition of the degree of M. Ch.
9. The official respondents sought to defend the promotion of
Dr. Sharmad to the said post of Associate Professor by referring to
G.O. dated 14th December, 2009 issued by the Health and Family
Welfare Department on the subject of pay and allowances, inter alia,
of the members of the Kerala Medical Education Service. According
to them, G.O. dated 14th December, 2009 abrogated G.O dated 07th

9 KS and SSR
[2025] 1 S.C.R.  421

Dr. Sharmad v. State of Kerala and Others

April, 2008 and in terms of the former, Dr. Sharmad did satisfy the
eligibility criteria for promotion to the said post of Associate Professor.
While providing for revised scale of pay for Associate Professors,
G.O. dated 14th December, 2009 laid down as follows:
1.5 Revised scale of Associate Professors
a) Medical & Dental
i) ***
ii) Incumbent Assistant Professors with five years
(for teachers with Super specialty degree in the
concerned discipline this will be two years after
acquiring Superspeciality degree) teaching experience
as Assistant Professor in the current pay scale of
Rs. 12000-18300 including Time Bound Higher Grade
service and a total service of 8 years after acquiring
Post Graduate Degree (5 years for Superspeciality
degree holders) in all grades put together will be
promoted and placed in the pay band of Rs.37,400-
67,000 with Academic Grade Pay of Rs.9,000 and
shall be redesignated as Associate Professors;
however they will have to publish two Research
papers within a period of two years promotion in
Peer Indexed/National Journals as per MCI/DCI
regulations; however for teachers of Dental Colleges,
as per the Dental Council of India regulations, only
Post PG teaching experience will be reckoned as
eligible service for placement as Associate Professor.
iii) Incumbent Assistant Professors who have not
completed 5 years teaching service (or having less
than 2 years service for superspeciality degree
holders) in the cadre of Assistant Professor (including
TBCP/CAP grade) as on 01.01.2006 will be placed in
the appropriate stage in the pay band of Rs.15,600-
39,100 and Academic Grade Pay of Rs.8,000/-,
till they complete the required period of 5/2 years
respectively. Thereafter on completion of 5 years
service as Assistant Professor, including Time Bound
Cadre Promotion grade in pre-revised scale (2 years
422 [2025] 1 S.C.R.

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for superspeciality degree holders) and a total service

of 8 years after acquiring Post graduate Degree
(5 years for superspeciality degree holders) in all
grades put together, they will be promoted and placed
in the appropriate stage in the Pay band of Rs.37,400-
67,000 with Academic Grade pay of Rs.9,000/- and
redesignated as Associate Professor, subject to
fulfilling academic performance requirements to be
specified. However they will have to publish two
Research papers within a period of two years in Peer
Indexed/National Journals as per MOI regulations;
provided that for Dental College teachers, only post
PG teaching experience will be reckoned as per
Dental Council of India norms for promotion.”
10. Though the claim of Dr. Jyothish failed before the Tribunal, as
noticed above, he succeeded before the High Court which went on
to hold that reliance placed by the official respondents on G.O. dated
14th December, 2009 was absolutely misplaced. The High Court further
held that Dr. Sharmad lacked 5 years physical teaching experience
as Assistant Professor after acquiring the degree of M. Ch. and,
therefore, ought not to have been promoted ahead of others who
did satisfy the eligibility criteria. Arguments of Dr. Jyotish relying on
Rules 10 and 28 of the KS and SSR were accepted. Accordingly, the
High Court set aside the appointment on promotion of Dr. Sharmad
to the said post of Associate Professor and directed the official
respondents to convene a review Departmental Promotion Committee
meeting for the purpose of drawing an appropriate select list to fill
up the said post of Associate Professor. It was also observed that
while preparing the select list, the relevant recruitment rules in force,
namely, G.O. dated 07th April, 2008 and the relevant provision of
Rule 28 of Part II, KS and SSR shall be looked into while excluding
G.O. dated 14th December, 2009 from consideration.
11. We have heard Mr. Giri and Mr. Chitambaresh, learned senior counsel
representing Dr. Sharmad and Dr. Jyotish, respectively. We have also
heard Mr. C.K. Sasi, learned counsel for the official respondents.
12. The eligibility criteria for appointment on posts borne in Branch – I
i.e. Administrative Cadre and in Branch – II i.e. Teaching Cadre, in
the absence of recruitment rules framed under Article 309 of the
[2025] 1 S.C.R.  423

Dr. Sharmad v. State of Kerala and Others

Constitution, are provided by G.O. dated 07th April, 2008 which is the
executive order governing recruitment. That is a position, which is
accepted even by Dr. Jyotish. According to him, Dr. Sharmad does
not qualify in terms thereof.
13. Law is settled that in the absence of rules, recourse to recruitment
based on executive orders could be taken. Even without examining
whether G.O. dated 14th December, 2009 had any application to the
promotional appointment in question, it would be just and proper to
focus on the requirements of G.O. dated 07th April, 2008.
14. The contents under the column ‘experience’ in G.O. dated 07th April,
2008, extracted supra, have been read. A plain and literal reading
does not lead to the conclusion that 5 years’ experience of physical
teaching as an Assistant Professor after acquiring M. Ch. degree is
one of the requisite qualifications.
15. Strong reliance has been placed by Mr. Chitambaresh on Rule 10(ab)
of Part – II, KS and SSR. A perusal of certain provisions of the
KS and SSR would be of profit:
2 (15) “Service” means a group of persons classified by
the State Government as a State or a Subordinate Service
as the case may be.
2 (16) “Special Rules” shall mean the rules in Part III
applicable to each service or class of service.
10. Qualifications - (a)(i) The educational or other
qualifications, if any, required for a post shall be as specified
in the Special Rules applicable to the service in which that
post is included or as specified in the executive orders of
Government in cases where Special Rules have not been
issued for the post/service.
(ii) Notwithstanding anything contained in these rules or
in the Special Rules, the qualifications recognised by
executive orders or standing orders of Government as
equivalent to a qualification specified for a post, in the
Special Rules or found acceptable by the Commission as
per rule 13(b)(i) of the said rules in cases where acceptance
of equivalent qualifications is provided for in the rules
and such of those qualifications which pre-suppose the
424 [2025] 1 S.C.R.

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acquisition of the lower qualification prescribed for the

post, shall also be sufficient for the post.
***
16. Turning to Rule 10(ab), it appears to have been incorporated in 1993
by an amendment. The text of Rule 10(ab) reads:
“Where the Special Rules or Recruitment Rules for a post
in any service prescribe qualification of experience, it shall,
unless otherwise specified, be one gained by persons on
temporary or regular appointment in capacities other than
paid or unpaid apprentices, trainees and casual labourers
in Central or State Government service or in Public Sector
Undertaking or Registered Private Sector Undertaking,
after acquiring the basic qualification for the post:
Provided that the experience gained as factory workers
on daily wages of a permanent nature may be accepted,
if the service is continuous and not of a casual nature.”
17. ‘Recruitment Rules’ is used in Rule 10(ab) as an alternative to
Special Rules, without the same being defined. To understand
what ‘Recruitment Rules’ would mean in the context, one may
simultaneously read Rule 10(a)(i) extracted supra.
18. Thus, without ‘Recruitment Rules’ being defined, it can take colour
from Rule 10(a)(i) and be understood to mean and include executive
orders of the Government in a case where Special Rules are absent.
19. Even if the KS and SSR were applicable, nothing turns on it because
Rule 10(ab) itself consciously uses the expression “unless otherwise
specified”. The Tribunal briefly assigned a reason as to how such
expression was material for dislodging the argument of Dr. Jyotish.
While we concur with the Tribunal, we wish to elaborate a little further
for the sake of clarity.
20. Our reading of Rule 10 of the KS SSR, as originally framed in 1958,
together with the amendments incorporated in it from time to time,
including Rule 10(ab), leads us to the irresistible conclusion that Rule
10 is entirely irrelevant and immaterial for appointment on promotion
in the Administrative and Teaching Cadres of the Medical Education
Services. The recruitment rules with which we are concerned, i.e.,
G.O. dated 07th April, 2008, was issued at a point of time when
[2025] 1 S.C.R.  425

Dr. Sharmad v. State of Kerala and Others

Rule 10(ab) had already found its way in the KS and SSR by an
amendment. G.O. dated 07th April, 2008 was issued superseding all
existing rules and orders in force on the method of appointment of
the faculties under medical education service. The executive must,
therefore, be deemed to be aware of what the KS and SSR, which
are the general rules, provided. Notwithstanding the same, G.O. dated
07th April, 2008 was issued governing recruitment in two branches
i.e. Administrative and Teaching Cadres. G.O. dated 07th April, 2008
is, thus, a special rule as distinguished from a general rule like the
KS and SSR. Rule 10(ab), on its own showing, having referred to
the expression “unless otherwise specified”, the same has to be
given some meaning or else it would be rendered redundant. It is
well settled that no word, no phrase and no expression used in a
legislation should be excluded as surplusage, while the courts embark
on a course of interpretation. In our reading, the distinction in the
qualifications for posts in Branch-I and Branch-II in G.O. dated 07th
April, 2008 would constitute the specification which is excluded from
the purview of Rule 10(ab) and such rule had / has no application
to the promotional appointment in question. The Tribunal was quite
right in its observation.
21. We also propose to assign one other reason, in continuation of the
one discussed above, to support the view of the Tribunal that the
original application of Dr. Jyotish did deserve in limine dismissal.
22. This is a case where the maxim expressio unius est exclusio alterius
(meaning whatever has not been included has impliedly been
excluded) would apply. In G.O. dated 07th April, 2008, the words
“after acquiring postgraduate degree” are specifically included in the
column for experience qua eligibility criteria for appointment on the
posts of Director of Medical Education and Joint Director of Medical
Education/Principals of Medical Colleges, i.e., posts in Branch – I
i.e. Administrative Cadre. If, indeed, it were the intention of the
executive that aspirants for the said post of Associate Professor,
or, for that matter, for the post of Professor were required to have
physical teaching experience in the feeder posts for specified number
of years “after acquiring postgraduate degree”, it defies reason as
to why the same qualification was not included for appointments
on promotion to posts borne in Branch – II i.e. Teaching Cadre
but included for the posts borne in Branch – I i.e. Administrative
Cadre. The submission on behalf of Dr. Jyotish that posts borne
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in the Administrative Cadre have responsibilities different from

those borne in the Teaching Cadre, though attractive at first blush,
pales into insignificance primarily for the reason that insistence of
physical teaching experience of a specified number of years with
a particular postgraduate or super speciality degree would seem
to be more required and demanding for appointment on posts in
the Teaching Cadre rather than those in the Administrative Cadre.
We are, thus, minded to hold that the exclusion of the words “after
acquiring postgraduate degree” is deliberate and conscious and the
contentions advanced by Mr. Chitambaresh, to the contrary, do not
commend acceptance.
23. Note to Rule 28(b)(1A) of Part – II, KS and SSR also does not come
to the rescue of Dr. Jyotish. The provision therein would apply if on
the relevant date there is no qualified candidate for promotion. That
is not the case here. As on the date of occurrence of vacancy i.e. 13th
November, 2012, Dr. Sharmad had physical teaching experience of
more than 5 years as Assistant Professor (he having joined on 11th
January, 2007). He being eligible, in terms of the recruitment rules,
there was no occasion for invoking the said note. The High Court
erred in placing reliance on Rule 28(b)(1A).
24. It is now time to consider the decisions cited by Mr. Chitambaresh.
25. Shesharao Jangluji Bagde v. Bhaiyya s/o Govindrao Karale10
was relied on for the proposition that experience gained has to be
subsequent to the acquisition of qualification. What this Court in
paragraph 3 held is this:
“3. *** Normally when we talk of an experience, unless
the context otherwise demands, it should be taken as
experience after acquiring the minimum qualifications
required and, therefore, necessarily will have to be posterior
to the acquisition of the qualification. However, in the case
of a promotion the same interpretation may not be just or
warranted. It would depend on the relevant provisions as
also the particular type of experience which is required. ***”
(emphasis supplied)

10 [1990] Supp. 1 SCR 521 : (1991) Supp. 1 SCC 367

[2025] 1 S.C.R.  427

Dr. Sharmad v. State of Kerala and Others

26. It is clear as daylight that what this Court held and what is argued
as a proposition of law are at variance. The particular type of
experience required by G.O. dated 07th April, 2008 was possessed
by Dr. Sharmad; hence, this decision does not come to the rescue of
Dr. Jyotish. Furthermore, an examination of the ratio of the decision
favours the case of Dr. Sharmad. Not only does the passage begin with
‘(N)ormally’ leaving room for cases which are other than normal, this
Court also qualified that experience required should be deemed to be
experience gained after acquiring the minimum qualifications, unless
the context otherwise demands. This is crucial. Also, such a general
interpretation may not arise in case of promotional appointments.
G.O. dated 07th April, 2008, read as a whole, evinces without any
ambiguity the view of the Government that where the experience
had to be gained posterior to the acquisition of qualification, it had
directly stated so. Thus, in the context of this case, absence of such
a stipulation gives rise to but one conclusion, that the Government
did not demand such post-qualification experience for the posts
under consideration here. Although, normally, experience gained after
acquiring a particular qualification could justifiably be insisted upon
by the employer, there could be exceptions and the present case
is one such exception. It is well settled that the intention of the rule
framer has to be assessed on both parameters i.e. the words used
and that of necessary implication. The requisite of post-qualification
experience being present in Branch – I, and absent from Branch – II,
necessarily implies that it was not a requirement for appointments
on promotion to posts borne in Branch – II.
27. The next decision cited is Arun Kumar Agarwal (Dr.) v. State of
Bihar 11 for the proposition that if a candidate is available with super
speciality, he should be given preference. We need to read paragraph
12 of the decision to understand what precisely was held by this
Court. The relevant sentence reads:
“12. *** Thus the appellant having a degree in superspeciality
and also having research work or working experience has
been rightly given preference in the matter of appointment
to the post of Assistant Professor in Neurosurgery over
respondent 5 who did not have a degree in superspeciality.”

11 [1991] 2 SCR 491 : (1991) Supp. 1 SCC 287

428 [2025] 1 S.C.R.

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28. Arun Kumar Agarwal (Dr.) (supra) is distinguishable on facts. Since

‘preference’ has been referred to, it goes without saying that the
ratio thereof could apply where other qualifications / things being
equal, preference is given to an aspirant having higher qualification.
In the case before us, although both Dr. Sharmad and Dr. Jyotish
were holders of M. Ch. degrees, as on date of occurrence of the
vacancy on the said post of Associate Professor i.e. 13th November,
2012, Dr. Jyotish did not have the requisite experience of 5 years
physical teaching as an Assistant Professor (he admittedly having
been promoted to such post only on 22nd July, 2008). Question of
preferring Dr. Jyotish to Dr. Sharmad did not arise at all since the
former was deficient insofar as experience on the post of Assistant
Professor is concerned.
29. The upshot of the aforesaid discussion leaves us with no option but
to hold that the impugned judgment and order of the High Court is
unsustainable. The same is set aside and the judgment and order
of the Tribunal restored, with the result that the original application
of Dr. Jyotish shall stand dismissed.
30. Civil Appeal No. 13422 of 2024 is, thus, allowed. Parties shall,
however, bear their own costs.
31. Pending application, if any, stands disposed of.

Civil Appeal No. 13423 of 2024

32. The High Court, vide the impugned judgment and order dated 4th
April, 2017, modified the order dated 9th January, 2015 of the Tribunal
under challenge before it and disposed of the original petition12
preferred by Dr. R. Jayaprakash. This appeal, by special leave, is
directed against the said judgment and order.
33. Promotion from the post of Senior Lecturer to the post of Assistant
Professor in Paediatrics was the subject matter of consideration in the
original application before the Tribunal. Whether three years’ physical
teaching experience gained after acquisition of Post Graduate (PG)
qualification is the prescribed condition that an aspirant was required
to fulfil, fell for examination. The Tribunal held that experience gained
only after acquiring PG qualification would count.

12 O.P. (KAT) No.148 of 2015

[2025] 1 S.C.R.  429

Dr. Sharmad v. State of Kerala and Others

34. The operative part of the High Court’s order reads as follows:
“In the said circumstances, the impugned order passed
by the Tribunal in T.A. No.4858/12 to the extent it held
that Rule 10(ab) of the General Rules is applicable in the
matter of promotion to the post of Assistant Professor in
the Medical Education Department is confirmed. However,
the consequential direction issued by the Tribunal to the
first respondent to review promotion of the applicant and
respondent Nos.4 to 6 and assign the dates of promotion
to the post of Assistant Professor, having due regard to
the date of occurrence of the vacancy and the date of
acquisition of Post Graduate qualification in the feeder
category, stand set aside.”
35. The decisions cited by Mr. Romy Chacko, learned senior counsel
for the impleading applicants have been considered.
36. Indian Airlines Ltd. v. S Gopalakrishnan13 laid down the law upon
consideration of the general information instructions which clearly
indicated that the experience would be computed after the date of
acquiring necessary qualifications. That is not the case here. The
requirements in Indian Airlines Ltd. (supra) are strikingly dissimilar
to the recruitment rules governing promotional appointments, which
are under consideration. This decision, therefore, is of no assistance
to Mr. Chacko.
37. The decisions of the High Court, viz., Sirajudheen v. Public Service
Commission,14 Rabi v. State of Kerala15 and A. Basheer v. Saiful
Islam A.,16 once again did not have the occasion to consider G.O.
dated 07th April, 2008 since the recruitment in question in all three
cases were in different departments of the Govt. of Kerala. The said
decisions having been rendered upon examination of rules governing
appointments on the posts of Assistant Motor Vehicle Inspector,
Reader in Political Science and Assistant Professor in the Kerala
Dental Education Service, respectively, which are at variance with

13 [2000] Supp. 5 SCR 548 : (2001) 2 SCC 362

14 1999 (1) LLN 408
15 2007 SCC OnLine Ker 418
16 2014 SCC OnLine Ker 18469
430 [2025] 1 S.C.R.

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G.O. dated 07th April, 2008, these three decisions of the High Court
also do not help Mr. Chacko.
38. Having regard to the findings and conclusions that we have recorded
while allowing Civil Appeal No. 13422 of 2024, the judgment and
order under challenge dated 4th April, 2017 cannot be sustained in
law. The same is set aside with the result that the original application
of Dr. R. Jayaprakash shall stand dismissed.
39. Thus, Civil Appeal No. 13423 of 2024 too stands allowed.
40. Pending application, if any, stands disposed of.

Result of the case: Appeals allowed.

†
Headnotes prepared by: Divya Pandey
 [2025] 1 S.C.R. 431 : 2025 INSC 38

Principal Commissioner of Income Tax-4 & Anr.

v.
M/s Jupiter Capital Pvt. Ltd.
(Special Leave Petition No. 63 of 2025)
02 January 2025
[J.B. Pardiwala and R. Mahadevan, JJ.]

Issue for Consideration

Whether reduction in share capital is covered under “sale, exchange
or relinquishment of the asset” used in Section 2(47) of the Income
Tax Act, 1961.

Headnotes†
Income Tax Act, 1961 – s.2(47) – “sale, exchange or
relinquishment of the asset” – Reduction in share capital,
if covered within the expression “sale, exchange or
relinquishment of the asset”:
Held: Yes – Reduction in share capital of the subsidiary company
and subsequent proportionate reduction in the shareholding
of the assessee, is squarely covered within the ambit of the
expression “sale, exchange or relinquishment of the asset” used in
s.2(47) – s.2(47) is an inclusive definition, inter alia, providing that
relinquishment of an asset or extinguishment of any right therein
amounts to a transfer of a capital asset – While the taxpayer
continues to remain a shareholder of the company even with the
reduction of share capital, it could not be accepted that there
was no extinguishment of any part of his right as a shareholder
qua the company – When as a result of the reducing of the face
value of the preference share, the share capital is reduced, the
right of the preference shareholder to the dividend or his share
capital and the right to share in the distribution of the net assets
upon liquidation is extinguished proportionately to the extent of
reduction in the capital – Such a reduction of the right of the capital
asset amounts to a transfer within the meaning of s.2(47) – In the
present case, the face value per share remained the same before
the reduction of share capital and after the reduction of share
capital – However, as the total number of shares were reduced
432 [2025] 1 S.C.R.

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from 15,35,05,750 to 10,000 and out of this the assessee was

holding 15,33,40,900 shares prior to reduction and 9988 shares
after reduction, it can be said that on account of reduction in
the number of shares held by the assessee in the company, the
assessee extinguished its right of 15,33,40,900 shares, and in
lieu thereof, it received 9988 shares at Rs. 10 each along with an
amount of Rs. 3,17,83,474 – No error committed by High Court
in passing the impugned order dismissing the appeal filed by the
Revenue and affirming the order passed by the ITAT. [Paras 9,
10, 12, 14, 18]

Case Law Cited

Kartikeya V. Sarabhai v. Commissioner of Income Tax [1997] Supp.
3 SCR 746 : (1997) 7 SCC 524 – relied on.
Commissioner of Income Tax v. Vania Silk Mills (P.) Ltd. (1977)
107 ITR 300 (Guj) : 1976 SCC OnLine Guj 92; Commissioner
of Income-Tax v. Jaykrishna Harivallabhdas (1998) 231 ITR 108 :
1997 SCC OnLine Guj 255; Anarkali Sarabhai v. CIT [1997] 1
SCR 500 : (1997) 3 SCC 238 : – referred to.

List of Acts
Income Tax Act, 1961; Companies Act, 2013.

List of Keywords
Section 2(47) of the Income Tax Act, 1961; Reduction in share
capital; Transfer of a capital asset; Sale; ‘transfer’; “sale,
exchange or relinquishment of the asset”; Relinquishment of
an asset; Extinguishment of any right; Subsidiary company;
Subsequent proportionate reduction in the shareholding of
the assessee; Inclusive definition, Preference share; Right of
the preference shareholder; Reducing of the face value of the
preference share.

Case Arising From

EXTRAORDINARY APPELLATE JURISDICTION: Special Leave
Petition (Civil) No. 63 of 2025
From the Judgment and Order dated 20.02.2023 of the High Court
of Karnataka at Bengaluru in ITA No. 299 of 2019
[2025] 1 S.C.R.  433

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

Appearances for Parties

N. Venkataraman, A.S.G., Raj Bahadur Yadav, Suyash Pandey,
Navanjay Mahapatra, V. Chandrashekhara Bharathi, Chinmayee
Chandra, Advs. for the Petitioners.

Judgment / Order of the Supreme Court

Order

1. Delay condoned.
2. This petition is at the instance of the Revenue, seeking leave to
appeal against the judgement and order dated 20.02.2023 passed
by the High Court of Karnataka at Bengaluru in Income Tax Appeal
(ITA) No. 299 of 2019 by which the appeal filed by the Revenue
against the judgement and order passed by the ITAT Bengaluru
came to be dismissed and thereby the judgement and order passed
by the ITAT came to be affirmed.
3. The appeal was admitted by the High Court on the following substantial
question of law:
“Whether on the facts and circumstances of the case, the
Tribunal is right in law in setting aside the disallowance of
capital loss claimed by the assessee of Rs.164,48,55,840/-
by holding that there is extinguishment of rights of
153340900 shares when no such extinguishment of
rights is made out by the assessee as required under
section 2(47) of the Act and there is no reduction in the
face value of share.”
4. It appears from the materials on record that the respondent-
assessee is a company engaged in the business of investing
in shares, leasing, financing and money lending. The assessee
had made an investment in Asianet News Network Pvt. Ltd., an
Indian company engaged in the business of telecasting news,
by purchasing 14,95,44,130 shares having face value of Rs 10/-
each. Thereafter, the assessee purchased 38,06,758 shares from
other parties, thereby increasing its shareholding to 15,33,40,900
shares which constituted 99.88% of the total number of shares of
the company, i.e., 15,35,05,750.
434 [2025] 1 S.C.R.

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5. The said company incurred losses, as a result of which the net worth
of the company got eroded. Subsequently, the company filed a petition
before the Bombay High Court for reduction of its share capital to set
off the loss against the paid-up equity share capital. The High Court
ordered for a reduction in the share capital of the company from
15,35,05,750 shares to 10,000 shares. Consequently, the share of
the assessee was reduced proportionately from 15,33,40,900 shares
to 9,988 shares. However, the face value of shares remained the
same at Rs. 10 even after the reduction in the share capital. The High
Court also directed the company for payment of Rs. 3,17,83,474/- to
the assessee as a consideration.
6. During the year, the assessee claimed long term capital loss accrued
on the reduction in share capital from the sale of shares of such
company. However, the Assessing Officer while disagreeing with
the assessee’s claim held that reduction in shares of the subsidiary
company did not result in the transfer of a capital asset as envisaged
in Section 2(47) of the Income Tax Act, 1961. The Assessing Officer
took the view that although the number of shares got reduced by
virtue of reduction in share capital of the company, yet the face
value of each share as well as shareholding pattern remained the
same. The relevant observations from the assessment order are
extracted hereinbelow:
“10. [...] However, the question of extinguishment of rights
with relation to the shareholders does not arise. It was only
reduction of shares by way of extinguishing the number of
shares and not extinguishing the rights of the shareholders.
For the reason that the word “extinguished” is mentioned
in the Petition or the Court Order, it does not amount to
translate the meaning of the word “extinguishment of rights”
as per section 2(47) of the Act.
xxx xxx xxx
Extinguishment of Rights would mean that the assessee
has parted with those shares or sold off those shares to
a second party. Here, the assessee has not sold off any
shares or has not parted with the shares as the it still holds
the proportionate percentage which he initially held is still
shown as an investment.”
[2025] 1 S.C.R.  435

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

7. In appeal the CIT(A) vide order dated 14.12.2017 while distinguishing

the facts of the present case from those involved in the decision of
this Court in Kartikeya V. Sarabhai v. Commissioner of Income
Tax reported in (1997) 7 SCC 524 held that any extinguishment
of rights would involve parting the sale of percentage of shares to
another party or divesting rights therein. The relevant observations
made by the CIT(A) are reproduced as follows:
“6.6(ii) The factual position of and the applicability of the
judicial decisions in the present case, clearly reveals that
the Assessee’s claim of capital loss, is not acceptable
in view of certain crucial questions, emerging for
consideration in the present case. The AO has analysed
the Assessee’s shareholding pattern, in the impugned
order, which has been perused. A comparative-analysis
of the opening / closing balances of ANNPL shares and
the consequent reduction in numbers / face value and
the percentage ratio of share- holding, reveals a clear
position that there was no effective transfer, resulting in
Long Term Capital Loss…
(iii) [...] It clearly emerges, that there was no effective
transfer, which could result in any real Long Term Capital
Loss as claimed by the appellant in the present case. It
transpires that the appellant company invested in total
equity share of Rs. 153340900/- at face value of (Rs. 10)
on different dates, in its subsidiary company (ANNPL).
The total number of shares of ANNPL was 153505750
out of which the assessee’s shareholding was 99.88%.
Pursuant to the share reduction scheme there was
reduction in share capital of ANNPL from 153340900
to 10000 and thus the shares of the Assessee were
reduced from 153505750 to 9988. The face value of
the shares-reduced remained unchanged at Rs. 10,
even after the reduction. The shareholding ratio of the
assessee company also remained constant even after
implementation of the share-reduction scheme. This
percentage continued to be at the previous shareholding
figures of 99.88%.”
436 [2025] 1 S.C.R.

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8. However, the ITAT reversed the order passed by the CIT(A) and
allowed the appeal filed by the assessee observing that the decision
of this Court in Kartikeya V. Sarabhai (supra) is squarely applicable
to the facts of the present case. The relevant observations from the
order of the ITAT order are extracted hereinbelow:
“6. [...] In the present case, the face value per share
remains same i.e. Rs. 10 per share before reduction of
share capital and after reduction of share capital but the
total number of shares has been reduced from 153505750
to 10000 and out of this, the present assessee was holding
prior to reduction 153340900 shares and after reduction
9988 shares. In addition to this reduction in number of
shares held by the assessee company in ANNPL, the
assessee received an amount of Rs. 3,17,83,474/- from
ANNPL. Hence it is seen that in the facts of present
case, on account of reduction in number of shares held
by the assessee company in ANNPL, the assessee has
extinguished its right of 153340900 shares and in lieu
thereof, the assessee received 9988 shares at Rs. 10/-
each along with an amount of Rs. 3,17,83,474/. As per
this judgment of Hon’ble Apex Court rendered in the
case of Kartikeya V. Sarabhai Vs. CIT (supra), there is
no reference to the percentage of share holding prior to
reduction of share capital and after reduction of share
capital and hence, in our considered opinion, the basis
adopted by the CIT(A) to hold that this judgment of Hon’ble
Apex Court is, not applicable in the present case is not
proper and in our considered opinion, this is not proper.
In our considered opinion, in the facts of present case,
this judgment of Hon’ble Apex Court is squarely applicable
and by respectfully following this judgment of Hon’ble
Apex Court, we hold that the assessee’s claim for capital
loss on account of reduction in share capital in ANNPL is
allowable. We hold accordingly.”
9. The Revenue went in appeal before the High Court. The High Court
while dismissing the appeal filed by the Revenue and affirming the
order passed by the ITAT observed in para 8 as under:
[2025] 1 S.C.R.  437

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

“Undisputed facts are, pursuant to the order passed by

the High Court of Bombay, number of shares has been
reduced to 9988. It is significant to note that the face value
of the share has remained same at Rs. 10/- even after
the reduction. The AO’s view that the voting power has not
changed as the percentage of assessee’s share of 99.88%
has remained unchanged is untenable because if the shares
are transferred at face value, the redeemable value would
be Rs.99,880/- whereas the value of 14,95,44,130 number
of shares would have been Rs.1,49,54,41,300/-. In our
considered view, the ITAT has rightly followed authority in
Kartikeya V. Sarabhai v. The Commissioner of Income Tax :
1998 2 ITR 163 SC with regard to meaning of transfer by
holding that there was no transfer within the meaning of
that expression contained in Section 2(47) of the Income
Tax Act, 1961.”
10. Having heard Mr. N. Venkataraman, learned ASG appearing for the
Revenue, and having gone through the materials on record, we
are of the view that no error, not to speak of any error of law, could
be said to have been committed by the High Court in passing the
impugned order.
11. Whether reduction of capital amounts to transfer is no longer res
integra in view of the decision of this Court in Kartikeya V. Sarabhai
(supra) wherein this Court while elaborating upon Sections 2(47)
and 45 of the Income Tax Act, 1961 respectively observed as under:
“9. It is not possible to accept the contention of Shri
Ganesh, learned counsel that reduction does not amount
to a transfer of the capital asset. Section 2(47) of the Act
reads as follows:
“2. (47) ‘transfer’ in relation to a capital asset, includes,
(i) the sale, exchange or relinquishment of the asset;
or
(ii) the extinguishment of any rights therein; or
(iii) the compulsory acquisition thereof under any
law; or
438 [2025] 1 S.C.R.

Digital Supreme Court Reports

(iv) in a case where the asset is converted by the

owner thereof into, or is treated by him as, stock-in-
trade or a business carried on by him, such conversion
or treatment; or
(v) any transaction involving the allowing of the
possession of any immovable property to be taken
or retained in part performance of a contract of the
nature referred to in Section 53-A of the Transfer of
Property Act, 1882 (4 of 1882); or
(vi) any transaction (whether by way of becoming
a member of, or acquiring shares in, a cooperative
society, company or other association of persons or
by way of any agreement or any arrangement or in
any other manner whatsoever) which has the effect
of transferring, or enabling the enjoyment of, any
immovable property.
Explanation.—For the purposes of sub-clauses (v) and
(vi), ‘immovable property’ shall have the same meaning
as in clause (d) of Section 269-UA;”
10. Section 45 of the Act reads as follows:
“45. Capital gains.—(1) Any profits or gains arising
from the transfer of a capital asset effected in the
previous year shall, save as otherwise provided in
Sections 53, 54, 54-B, 54-D, 54-E, 54-F and 54-G,
be chargeable to income tax under the head ‘Capital
gains’ and shall be deemed to be the income of the
previous year in which the transfer took place.”
11. Section 2(47) which is an inclusive definition, inter alia,
provides that relinquishment of an asset or extinguishment
of any right therein amounts to a transfer of a capital asset.
While, it is no doubt true that the appellant continues
to remain a shareholder of the company even with the
reduction of share capital but it is not possible to accept
the contention that there has been no extinguishment of
any part of his right as a shareholder qua the company.
It is not necessary that for a capital gain to arise there
[2025] 1 S.C.R.  439

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

must be sale of a capital asset. Sale is only one of the

modes of transfer envisaged by Section 2(47) of the Act.
Relinquishment of the asset or the extinguishment of
any right in it, which may not amount to sale, can also
be considered as a transfer and any profit or gain which
arises from the transfer of a capital asset is liable to be
taxed under Section 45 of the Act.
12. When as a result of the reducing of the face value
of the shares, the share capital is reduced, the right of
the preference shareholder to the dividend or his share
capital and the right to share in the distribution of the net
assets upon liquidation is extinguished proportionately
to the extent of reduction in the capital. Whereas the
appellant had a right to dividend on a capital of Rs 500
per share that stood reduced to his receiving dividend
on Rs 50 per share. Similarly, if the liquidation was to
take place whereas he originally had a right to Rs 500
per share, now his right stood reduced to receiving Rs
50 per share only. Even though the appellant continues
to remain a shareholder his right as a holder of those
shares clearly stands reduced with the reduction in the
share capital.
13. The Gujarat High Court had in another case reported
as Anarkali Sarabhai v. CIT [(1982) 138 ITR 437 (Guj)]
followed the judgment under appeal. That was a case
where there had been redemption of preference share
capital by the company and money was paid to the
shareholders. It was held therein that difference between
the face value received by the shareholder and the price
paid for preference shares was exigible to capital gains tax.
In coming to this conclusion, the Gujarat High Court had
followed the judgment under appeal in the present case.
14. The aforesaid decision of the Gujarat High Court in
Anarkali case [(1982) 138 ITR 437 (Guj)] was challenged
and this Court in Anarkali Sarabhai v. CIT [(1997) 3
SCC 238 : (1997) 224 ITR 422] upheld the High Court’s
decision. It had been contended in Anarkali case
440 [2025] 1 S.C.R.

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[(1997) 3 SCC 238 : (1997) 224 ITR 422] on behalf of

the assessee that reduction of preference shares was
not a sale or relinquishment of asset and, therefore, no
capital gains tax was payable. Repelling this contention,
this Court considered the definition of the word “transfer”
occurring in Section 2(47) of the Act and reading the
same along with Section 45, it came to the conclusion
that when a preference share is redeemed by a company,
what the shareholder does in effect is to sell the share
to the company. The company redeems its preference
shares only by paying the preference shareholders the
value of the shares and taking back the preference shares.
It was observed that in effect the company buys back
the preference shares from the shareholders. Further,
referring to the provisions of the Companies Act, it held
that the reduction of preference shares by a company
was a sale and would squarely come within the phrase
“sale, exchange or relinquishment” of an asset under
Section 2(47) of the Act. It was also held that the definition
of the word “transfer” under Section 2(47) of the Act was
not an exhaustive definition and that sub-section (I) of
clause (47) of Section 2 implies that parting with any capital
asset for gain would be taxable under Section 45 of the
Act. In this connection, it was noted that when preference
shares are redeemed by the company, the shareholder
has to abandon or surrender the shares, in order to get
the amount of money in lieu thereof.
15. In our opinion, the aforesaid decision of this Court in
Anarkali case [(1997) 3 SCC 238 : (1997) 224 ITR 422]
is applicable in the instant case. The only difference in
the present case and Anarkali case [(1997) 3 SCC 238 :
(1997) 224 ITR 422] is that whereas in Anarkali case
[(1997) 3 SCC 238 : (1997) 224 ITR 422] preference
shares were redeemed in entirety, in the present case,
there has been a reduction in the share capital inasmuch
as the company had redeemed its preference shares of
Rs 500 to the extent of Rs 450 per share. The liability of
the company in respect of the preference share which was
[2025] 1 S.C.R.  441

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

previously to the extent of Rs 500 now stood reduced to

Rs 50 per share.”
12. The following principles are discernible from the aforesaid decision
of this Court:
a. Section 2(47) of the Income Tax Act, 1961, which is an inclusive
definition, inter alia, provides that relinquishment of an asset
or extinguishment of any right therein amounts to a transfer
of a capital asset. While the taxpayer continues to remain a
shareholder of the company even with the reduction of share
capital, it could not be accepted that there was no extinguishment
of any part of his right as a shareholder qua the company.
b. A company under Section 66 of the Companies Act, 2013 has
a right to reduce the share capital and one of the modes which
could be adopted is to reduce the face value of the preference
share.
c. When as a result of the reducing of the face value of the
share, the share capital is reduced, the right of the preference
shareholder to the dividend or his share capital and the right
to share in the distribution of the net assets upon liquidation is
extinguished proportionately to the extent of reduction in the
capital. Such a reduction of the right of the capital asset clearly
amounts to a transfer within the meaning of section 2(47) of
the Income Tax Act, 1961.
13. As observed in Commissioner of Income Tax v. Vania Silk
Mills (P.) Ltd. reported in (1977) 107 ITR 300 (Guj), the expression
“extinguishment of any right therein” is of wide import. It covers every
possible transaction which results in the destruction, annihilation,
extinction, termination, cessation or cancellation, by satisfaction
or otherwise, of all or any of the bundle of rights - qualitative or
quantitative - which the assessee has in a capital asset, whether
such asset is corporeal or incorporeal.
14. In the present case, the face value per share has remained the
same before the reduction of share capital and after the reduction
of share capital. However, as the total number of shares have been
reduced from 15,35,05,750 to 10,000 and out of this the assessee
was holding 15,33,40,900 shares prior to reduction and 9988 shares
442 [2025] 1 S.C.R.

Digital Supreme Court Reports

after reduction, it can be said that on account of reduction in the

number of shares held by the assessee in the company, the assessee
has extinguished its right of 15,33,40,900 shares, and in lieu thereof,
the assessee received 9988 shares at Rs. 10 each along with an
amount of Rs. 3,17,83,474. This Court in the case of Kartikeya V.
Sarabhai (supra) has not made any reference to the percentage of
shareholding prior to reduction of share capital and after reduction
of share capital.
15. This Court in the case of Kartikeya V. Sarabhai (supra) observed
that reduction of right in a capital asset would amount to ‘transfer’
under Section 2(47) of the Act, 1961. Sale is only one of the modes
of transfer envisaged by Section 2(47) of the Income Tax Act, 1961.
Relinquishment of any rights in it, which may not amount to sale, can
also be considered as transfer and any profit or gain which arises
from the transfer of such capital asset is taxable under Section 45
of the Income Tax Act, 1961.
16. A Division Bench of the Gujarat High Court in the case of
Commissioner of Income-Tax v. Jaykrishna Harivallabhdas
reported in (1998) 231 ITR 108 further clarified that receipt of some
consideration in lieu of the extinguishment of rights is not a condition
precedent for the computation of capital gains as envisaged under
Section 48 of the Income Tax Act, 1961. The relevant observations
made by the High Court are reproduced hereinbelow:
28. The contention that this provision should apply to
actual receipts only also cannot be accepted for yet
another reason, because acceptance of that would
lead to an incongruous and anomalous result as will
be seen presently. The acceptance of this view would
mean whereas even in a case where a sum is received,
howsoever negligible or insignificant it may be, it would
result in the computation of capital gains or loss, as the
case may be, but in a case where nothing is disbursed
on liquidation of a company the extinction of rights, would
result in total loss with no consequence. That is to say on
receipt of some cost, however insignificant it may be, the
entire gamut of computing capital gains for the purpose
of computing under the head “Capital gains” is to be gone
[2025] 1 S.C.R.  443

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

into, computing income under the head “Capital gains”, and

loss will be treated under the provisions of Act, but where
there is nil receipt of the capital, the entire extinguishment
of rights has to be written off, without treating under the
Act as a loss resulting from computation of capital gains.
The suggested interpretation leads to such incongruous
result and ought to be avoided, if it does not militate in any
manner against object of the provision and unless it is not
reasonably possible to reach that conclusion. As discussed
above, once a conclusion is reached that extinguishment
of rights in shares on liquidation of a company is deemed
to be transfer for operation of section 46(2) read with
section 48, it is reasonable to carry that legal fiction to
its logical conclusion to make it applicable in all cases
of extinguishment of such rights, whether as a result of
some receipt or nil receipt, so as to treat the subjects
without discrimination. Where there does not appear to be
ground for such different treatment the Legislature cannot
be presumed to have made deeming provision to bring
about such anomalous result.
(Emphasis supplied)
17. This Court in the case of Anarkali Sarabhai v. CIT reported in (1997)
3 SCC 238 observed that the reduction of share capital or redemption
of shares is an exception to the rule contained in Section 77(1) of
the Companies Act, 1956 that no company limited by shares shall
have the power to buy its own shares. In other words, the Court held
that both reduction of share capital and redemption of shares involve
the purchase of its own shares by the company and hence will be
included within the meaning of transfer under Section 2(47) of the
Income Tax Act, 1961. The relevant observations are reproduced
hereinbelow:
“21. The Bombay High Court in Sath Gwaldas Mathuradas
Mohata Trust v. CIT [(1987) 165 ITR 620 (Bom)] dealt with
the question which has now arisen in this case. There
the question was whether the amount received by the
assessee on redemption of preference shares was liable
to tax under the head “capital gains”. After referring to the
444 [2025] 1 S.C.R.

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meaning given to “transfer” by Section 2(47) of the Income

Tax Act, the Court held:
“Here, a regular ‘sale’ itself has taken place. That is
the ordinary concept of transfer. The company paid
the price for the redemption of the shares out of its
fund to the assessee and the transaction was clearly
a purchase. As rightly observed by the Tribunal, if
the company had purchased a valuable right, the
assessee had sold a valuable right. ‘Relinquishment’
and ‘extinguishment’ which are not in the normal
concept of transfer but are included in the definition
by the extended meaning attached to the word are
also attracted in the transaction. The shares were
assets and they were relinquished by the assessee
and thus relinquishment of assets did take place.
The assessee by virtue of his being a holder of
redeemable cumulative preference shares had a
right in the profits of the company, if and when made,
at a fixed rate of percentage. Quite obviously, this
was a valuable right and this right had come to an
end by the company’s redemption of shares. Thus,
the transaction also amounted to ‘extinguishment’
of right. Under the circumstances, viewed from any
angle, there is no escape from the conclusion that
Section 2(47) was attracted and that the amount of
Rs 50,000 received by the assessee was liable to
be taxed under the head ‘Capital gains’.”
22. The view taken by the Bombay High Court accords with
the view taken by the Gujarat High Court in the judgment
under appeal. In the judgment under appeal, it was pointed
out that the genesis of reduction or redemption of capital
both involved a return of capital by the company. The
reduction of share capital or redemption of shares is an
exception to the rule contained in Section 77(1) that no
company limited by shares shall have the power to buy its
own shares. When it redeems its preference shares, what
in effect and substance it does is to purchase preference
[2025] 1 S.C.R.  445

Principal Commissioner of Income Tax-4 & Another v.

M/s Jupiter Capital Pvt. Ltd.

shares. Reliance was placed on the passage from Buckley

on the Companies Acts, 14th Edn., Vol. I, at p. 181:
“Every return of capital, whether to all shareholders or
to one, is pro tanto a purchase of the shareholder’s
rights. It is illegal as a reduction of capital, unless
it be made under the statutory authority, but in the
latter case is perfectly valid.”
(Emphasis supplied)
18. In view of the aforesaid, we are of the view that the reduction in
share capital of the subsidiary company and subsequent proportionate
reduction in the shareholding of the assessee would be squarely
covered within the ambit of the expression “sale, exchange or
relinquishment of the asset” used in Section 2(47) the Income Tax
Act, 1961.
19. As a result, this petition fails and is hereby dismissed.

Result of the case: Petition dismissed.

†
Headnotes prepared by: Divya Pandey
 [2025] 1 S.C.R. 446 : 2025 INSC 34

Sanjay Dutt & Ors.

v.
The State of Haryana & Anr.
(Criminal Appeal No. 11 of 2025)
02 January 2025
[J.B. Pardiwala and R. Mahadevan, JJ.]

Issue for Consideration

According to the Range Forest Officer, the appellants (director and
office bearers of the company) had illegally uprooted trees with
JCB, destroyed them, and violated the section 4 of the Punjab Land
Preservation Act, 1900. The question that arises for consideration
is whether vicarious liability that can be attached to any of the
directors or any office bearers of the company.

Headnotes†
Punjab Land Preservation Act, 1900 – s.4 r/w. s.19 –
A license/necessary permission for development of the land
in the specified area was granted in favour of a company –
Complaint lodged by the Range Forest Officer – It was
alleged that the appellants (director and office bearers of the
company) had illegally uprooted trees and violated provisions
of the Act, 1900 – The Presiding officer-cum-JMIC, Special
Environment Court took cognizance of the complaint and
issued process for the offence punishable u/s.19 of the
Act, 1900 – Correctness:
Held: In the Scheme of the Act, 1900, there is no vicarious
liability that can be attached to any of the directors or any
office bearers of the company – It is the individual liability or
the act that would make the person concerned liable for being
prosecuted for the offence punishable u/s.19 of the Act, 1900 –
Having regard to the nature of the allegations, it is difficult to
take the view that the appellants herein are responsible for
the alleged offence – There are no allegations worth the name
in the complaint that the three appellants herein are directly
responsible for uprooting of the trees with the aid of Bulldozers
or JCB machines or causing damage to the environment – The
[2025] 1 S.C.R.  447

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

persons who were actually found at the site felling the trees
have not been arrayed as accused in the complaint – Although
the license/necessary permission for development of the land in
the specified area had been granted in favour of the company,
yet for the reasons best known to the complainant the company
has not been arrayed as an accused in the complaint – While
a company may be held liable for the wrongful acts of its
employees, the liability of its directors is not automatic – It
depends on specific circumstances, particularly the interplay
between the director’s personal actions and the company’s
responsibilities – A director may be vicariously liable only if the
company itself is liable in the first place and if such director
personally acted in a manner that directly connects their conduct
to the company’s liability – Mere authorization of an act at the
behest of the company or the exercise of a supervisory role
over certain actions or activities of the company is not enough
to render a director vicariously liable – In the instant case, the
allegations which find place against the appellants herein in their
personal capacity are absolutely vague – No case could be said
to have been made out for putting the three appellants to trial
for the alleged offence – The Court concerned could not have
issued process for the alleged offence – Thus, the impugned
complaint and order taking cognizance of the said complaint is
hereby quashed. [Paras 10, 11, 18]

Principle – Vicarious Liability – Provision in statute –

Requirement of:
Held: It is the cardinal principle of criminal jurisprudence that there
is no vicarious liability unless the statute specifically provides
so – Thus, an individual who has perpetrated the commission
of an offence on behalf of a company can be made an accused,
if the statute provides for such liability and if there is sufficient
evidence of his active role coupled with criminal intent – The
primary responsibility is on the complainant to make specific
averments as are required under the law in the complaint so as
to make the accused vicariously liable – For fastening criminal
liability on an officer of a company, there is no presumption
that every officer of a company knows about the transaction in
question. [Para 13]
448 [2025] 1 S.C.R.

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Case Law Cited

Maharashtra State Electricity Distribution Company Limited
and Anr. v. Datar Switchgear Limited and Ors. [2018] 1 SCR 733 :
(2010) 10 SCC 479 – referred to.

List of Acts
Punjab Land Preservation Act, 1900; Code of Criminal Procedure,
1973.

List of Keywords
Vicarious Liability; Directors; Personal Capacity; Wrongful act
of employees; Criminal Liability of officer of company; Specific
Provision in Statute; Criminal Intent; Specific Act.

Case Arising From

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal
No. 11 of 2025
From the Judgment and Order dated 08.12.2022 of the High Court
of Punjab & Haryana at Chandigarh in CRMM No. 55268 of 2022

Appearances for Parties

Ms. Meenakshi Arora, Sr. Adv., Sumesh Malhotra, Vikas Singh,
Pawan Bhardwaj, Jayesh Yadav, Yashvi, Ms. Russai Sidhu,
Ms. Chitra Singh, Lokesh Kumar Choudhary, Advs. for the Appellants.
Akshay Amritanshu, Ms. Drishti Saraf, Ms. Pragya Upadhyay,
Ms. Swati Mishra, Advs. for the Respondents.

Judgment / Order of the Supreme Court

Order

1. Leave granted.
2. This appeal arises from the judgment and order passed
by the High Court of Punjab and Haryana at Chandigarh dated
08-12-2022 in CRMM No.55268 of 2022 by which the High
Court rejected the petition filed by the appellants herein invoking
Section 482 of the Code of Criminal Procedure for the purpose of
[2025] 1 S.C.R.  449

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

quashing of complaint no. 41 of 2022 lodged by the Range Forest

Officer for the alleged offence under Section 4 of the Punjab Land
Preservation Act, 1900 (for short “the Act, 1900”) punishable under
Section 19 of the Act, 1900.
3. We have heard Ms. Meenakshi Arora, the learned senior counsel
appearing for the appellants and Mr. Akshay Amritanshu, the learned
counsel appearing for the respondents.
4. The short point that falls for our consideration is whether the plain
reading of the complaint lodged by the Range Forest Officer discloses
commission of any offence alleged to have been committed under
Section 4 read with Section 19 of the Act, 1900.
5. The complaint reads thus:-
“PC No.1G/2022-23
Case No.41/22
7-9-22
IN THE COURT OF HON’BLE PRESIDING OFFICER
SPECIAL ENVIRONMENT COURT, FARIDABAD
IN THE MATTER OF
Range Forest Officer Gurugram …….Applicants
Vs.
(1) Satpal Singh Project Manager
(2) Kamal Sehgal General Manager
(3) Sanjay Dutt Director, Sec-113
Bajgera Gurugram
…….Respondents
INDEX

S.No. Particular Page No.

1. Report of Forest etc. 1-2
2. Notice issued to Forest Criminals 3-4
3. Form No.21 5-6
450 [2025] 1 S.C.R.

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4. Form No.22 7-8

5. Notification 9-10
6. Statement of Forest Guard 11-12
7. Statement of Forest Inspector 13-14
8. Site plan of Forest crime scene 15-16
9. Reply of forest criminal 17-19

xxxx xxxx xxxx xxxx

Sd/-
Range Forest Officer,
Gurugram
Forest Crime Report
Forest Department, Government of Haryana
FOR Book No.0495 FOR No.079

Forest Division Gurugram

Range/Bloc/Beat Gurugram/Mullanpur/Jhadsa

Reach/Name of the place Sec-113-Gate vida GGM

FOR No. (Date, Day & 079/10495-02/09/2021

Time)

Name of the report issuing Hansraj

officer

Source of information about Self patrolling/informer/complaint

the crime

Date/Day/Time of the
commission of the crime

Name and designation of Sh. Virender Kumar Sr. Inspector

the Investigating Officer

Description of the crime/ No/If yes then No.

incident

Act violated Section

Indian Forest Act, 1927

[2025] 1 S.C.R.  451

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

Wild Life (Protection) Act,

1972

Punjab Land Conservation Sec-4

Act, 1900

Indian Penal Code

Description of Name Father’s Age Caste Address

criminal Name

(1) Project Sec-113, Gate Vida Bajgeda

Satpal Manager Gurugram
Singh

(2) General
Kamal Manager
Sehgal

(3) Director
Sanjay
Dutt

Description of confiscated articles

Details of Type Type/ Numbers Dead Compensation

confiscated Size amount
forest produce
(1) Kikkar =7 (iv) (3) ________small plants = 62

(2) Kikkar = 5 (iv) (4) _________ (iv) = 46

(5) ,, ,, (v) = 72

(6) Misc. (u/s) = 126

Details of Type Regd. Color Model Manufacture

vehicle seized No. date

xxxxx Total=ABSTRFC

xxxxxx U/s V IV Total

-- 7 5 12

126 72 46 244

Total 126 79 51 256

Tools/ Weapons xxxxxx xxxxxx xxxxxx xxxxx xxxxxx

Others, if any xxxxxx xxxxxx xxxxxx xxxxx xxxxxx

Mark the correct xxxxxx xxxxxx xxxxxx xxxxx xxxxxx

452 [2025] 1 S.C.R.

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Signature of Informer/ Beat Incharge

Complainant/ Witness
Sd/-
Sd/-

Signature/Thumb Impression of F.R.O.

accused
Name

Rank

Dated

PC No.1G/2022-23
Notice No.219.G
Dated: 2/9/2021
Notice
Indian Forest Act, 1900 Sec-4

Name : (1) Satpal Singh Project Manager

Address: (2) Kamal Sehgal General Manager
(3) Sanjay Dutt Director,
Sec-113, Gate Vida
Bajgera Gurugram

Forest Damage Report No.079/495 has been received

against you. Due to the forest crime committed by you,
the environment has been harmed. According to damage
report you have illegally uprooted trees situated in the area
of Sec-113 Gate Vida, Gurugram, with JCB, destroyed
them, and have violated the Sec-4 of the Indian Forest Act
PLPA, 1900. You are hereby informed through this notice
that you should appear before the undersigned on or before
7-9-2021 and explain your position that why a complaint
should not be filed against you in the Environment Court,
Faridabad as per the above said Indian Forest Act.
Forest Block Officer
Forest Area: Sultanpur
Range: Gurugram
[2025] 1 S.C.R.  453

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

PC No.1G/2022-23

Case No…… Description of incident Range…. Police

Station….District

1 2 3

Name and Regarding which Description of

address of matter statement, which
witnesses the witnesses
have hope for.
Hansaraj Sr. I According to (1) Forest Guard
I/C Gurugram FOR No.79/495, will depose
and Jhadsa the accused according to FOR
Beat have committed
(2) Forest
violation of
Virender Singh Inspector will
Section 4 of the
I/C Sultanpur depose according
PLPA, 1900 by
Block to FOR
uprooting 256
Forest Officer trees of Kikkar- (3) Forest Officer
I/C Gurugram and xxxx and 62 will depose
Range plants of xxxxx according to FOR
with JCB from
Sec-113, Gate
Vida, Gurugram.
No.I Description of case, which is to be written on all
Sd/-
Sd/-

Notification issued under Section 4 of the Act, 1900

Government of Haryana
Forest Department
Order
Dated, January 4, 2013
No.S.O.8/P.A.2/1900/S.4/2013-Whereas the Governor
of Haryana is satisfied after due inquiry, that for the
purpose of giving effect to the provisions of the Punjab
Land Preservation Act, 1900 (Punjab Act 2 of 1900), the
regulations, the conditions and the prohibition set out
hereinafter are necessary.
454 [2025] 1 S.C.R.

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Therefore, now, in exercise of the powers conferred under

Section 4 of the above said Act, the Governor of Haryana,
hereby in the Schedule given below, specifically prohibits
the following works in the specified areas, for a period
of fifteen years from the date of publication of this Order
in the Official Gazette, which has been notified under
Section 3 of the above said rule by the Government of
Haryana, Forest Department vide Notification No. S.O.81/
P.A.2/1900/S.3/2012 dated 19th December, 2012.
a. The cutting of trees or timber other than Safeda,
Popular, Bacain, Bass, Toot and Alanthak, and the
collection or removal of flowers, fruits and any produce
of different forest, except for the actual domestic or any
manufacturing process. Provided that the land owner
may sell trees or timber after obtaining a permit from
the concerned Divisional Officer before doing so. Such
permit shall prescribe such conditions for any sale as
may be deemed necessary from time to time in the
interest of forest conservation and 11 state farmers
will be free to sell their trees to any person/Agency/
Haryana and Development Corporation Limited at
their will. So as to enable them to get remunerative
price for their produce, provided that the land owner
may sell their trees after obtaining permission to do
so from the concerned Divisional Forest Officer.
P.C. No.1G/2022-23
FOR No.79/495
Dated 2-9-2021
Statement of Forest Guard
Sir,
The spot was inspected. The accused has uprooted the
tress standing on the inspected spot through JCB, the dt.
of which has been recorded.
Sd/-
Sd/-
[2025] 1 S.C.R.  455

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

Certified to be true translation

Advocate
P.C. No.1G/2022-23
FOR No.79/495
Dated 2-9-2021
Statement of Forest Inspector
Sir,
I do hereby solemnly affirm that upon receiving FOR
No.79/495 dated 2-9-2021, the spot was inspected.
Wherein on the spot at Sec-113, Gate Vida, Bajgera,
Kikkar and different types of trees were found to be
uprooted with the JCB and small plants of different types
were destroyed. According to FOR, the damage is found
to be correct. The accused were issued notice for violating
Section 4 of the PLPA, 1900. But the accused did not give
any satisfactory answer. In this FOR, after preparing PC
case of the accused, the same was given to Forest Range
Office, Gurugram for presenting before the Environment
Court, Faridabad. This is my statement
Sd/-
6. It appears from the materials on record that the Presiding Officer-
cum-JMIC, Special Environment Court Faridabad took cognizance of
the complaint, referred to above and issued process for the offence
punishable under Section 19 of the Act, 1900. The order issuing
process reads: -
“DFO Vs Satpal etc
Present Sh Gordhan Das, Forester; Gurugram on behalf
of the complainant
Heard on the point of summoning of accused In the challan
and the documents attached thereto, it is alleged by the
complainant that on 02.09.2021, in the area of sector 113
Gate Vida Gurugram, (this area has been notified under the
Forest Act, so, same belongs to the Forest Department),
the accused destroyed 256 trees using JCB It is also
456 [2025] 1 S.C.R.

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claimed by the complainant that the illegal act committed

by the above named accused, has caused a loss to the
tune of Rs 90580/- (Rupees Ninty Thousand Five Hundred
Eighty Only) to the Forest Department.
In view of the allegations leveled against the accused in
the challan and perusal of original documents appended
herewith, this court is of the opinion that a prima-facie
case is made out against the accused for indulging in said
illegal activity which led to the commission of an offence,
punishable u/s 19 of the Punjab Land Preservation Act,
1900.
Accordingly, accused is hereby ordered to be summoned
on 07.09.2022 and same is directed to appear in person
in the court.
(Seema)
PO Spl Env Court,
Faridabad UID HR0387
02.05.2022”
7. We are informed that the aforesaid complaint bearing CIS
No.COMA-134-2024 has now been transferred to the district Court
of Judicial Magistrate-1st Class, Gurugram.
8. It is not in dispute that so far as the appellant no.1 is concerned he
is the Managing Director and Chief Executive Officer of a company
namely TATA Realty and Infrastructure Limited and Tata Housing
Development Co. Ltd. So far as the appellant no.2 is concerned,
he at the relevant point of time was the General Manager and is
currently the Assistant Vice President of Tata Realty and Infrastructure
Limited in its Corporate Relations Group and so far as the appellant
no.3 is concerned he at the relevant point of time was the erstwhile
employee/Senior Manager of the company namely ‘Sector 113
Gatevida Developers Private Limited’ (formerly known as Lemon
Tree and Developers Private).

Relevant Provisions of Law:

9. Section 4 of the Act, 1900 reads thus:-
“4. Power to regulate, restrict or prohibit, by general or
special order, within notified areas, certain matters.— In
[2025] 1 S.C.R.  457

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

respect of areas notified under section 3 generally or

the whole or any part of any such area, the Provincial
Government] may, by general or special order temporarily
regulate, restrict or prohibit—
(a) the clearing or breaking up or cultivating of land not
ordinarily under cultivation prior to the publication of the
notification under section 3;
(b) the quarrying of stone or the burning of lime at places
where such stone or lime had not ordinarily been so
quarried or burnt prior to the publication of the notification
under section 3;
(c) the cutting of trees or timber, or the collection or removal
or subjection to any manufacturing process, otherwise than
as described in clause (b) of this sub-section of any forest-
produce other than grass, save for bonafide domestic or
agricultural purposes [of rightholder in such area];
(d) the setting on fire of trees, timber or forest produce;
(e) the admission, herding, pasturing or retention of
sheep,[goats or camels];
(f) the examination of forest-produce passing out of any
such area; and
(g) the granting of permits to the inhabitants of towns and
villages situate within the limits or in the vicinity of any
such area, to take any tree, timber or forest produce for
their own use therefrom, or to pasture sheep,[goats or
camels] or to cultivate or erect buildings therein and the
production and return of such permits by such persons.”
Section 19 of the Act, 1900 reads thus:-
“19. Penalty for offences.— Any person who, within the
limits of any area notified under section 3, commits any
breach of any regulation made, [restriction or prohibition
imposed, order passed or requisition made under sections
4, 5, 5-A, or 7-A] shall be punished with imprisonment
for a term which may extend to one month, or with a fine
which may extend to one hundred rupees, or with both”
458 [2025] 1 S.C.R.

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10. We take notice of the fact that having regard to the Scheme of
the Act, 1900, there is no vicarious liability that can be attached to
any of the directors or any office bearers of the company. It is the
individual liability or the act that would make the person concerned
liable for being prosecuted for the offence punishable under Section
19 of the Act, 1900. Having regard to the nature of the allegations,
it is difficult for us to take the view that the appellants herein are
responsible for the alleged offence. There are no allegations worth
the name in the complaint that the three appellants before us are
directly responsible for uprooting of the trees with the aid of Bulldozers
or JCB machines or causing damage to the environment. The
persons who were actually found at the site felling the trees have
not been arrayed as accused in the complaint. Although the license
/ necessary permission for development of the land in the specified
area had been granted in favour of the company, yet for the reasons
best known to the complainant the company has not been arrayed
as an accused in the complaint.
11. It appears that the Courts below proceeded on the erroneous
assumption that the three appellants herein being responsible officers
of the company are liable for the alleged offence. While a company
may be held liable for the wrongful acts of its employees, the liability
of its directors is not automatic. It depends on specific circumstances,
particularly the interplay between the director’s personal actions
and the company’s responsibilities. A director may be vicariously
liable only if the company itself is liable in the first place and if such
director personally acted in a manner that directly connects their
conduct to the company’s liability. Mere authorization of an act at
the behest of the company or the exercise of a supervisory role
over certain actions or activities of the company is not enough to
render a director vicariously liable. There must exist something to
show that such actions of the director stemmed from their personal
involvement and arose from actions or conduct falling outside the
scope of its routine corporate duties. Thus, where the company is
the offender, vicarious liability of the Directors cannot be imputed
automatically, in the absence of any statutory provision to this effect.
There has to be a specific act attributed to the director or any other
person allegedly in control and management of the company, to the
effect that such a person was responsible for the acts committed by
or on behalf of the company.
[2025] 1 S.C.R.  459

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

12. At the same time, wherever by a legal fiction the principle of vicarious
liability is attracted and a person who is otherwise not personally
involved in the commission of an offence is made liable for the same,
it has to be specifically provided in the statute concerned. When it
comes to penal provisions, vicarious liability of the managing director
and director would arise provided any provision exists in that behalf
in the statute. Even where such provision for fastening vicarious
liability exists, it does not mean that any and all directors of the
company would be automatically liable for any contravention of such
statute. Vicarious Liability would arise only if there are specific and
substantiated allegations attributing a particular role or conduct to
such director, sufficient enough to attract the provisions constituting
vicarious liability and by extension the offence itself.
13. It is the cardinal principle of criminal jurisprudence that there is no
vicarious liability unless the statute specifically provides so. Thus,
an individual who has perpetrated the commission of an offence on
behalf of a company can be made an accused, if the statute provides
for such liability and if there is sufficient evidence of his active role
coupled with criminal intent. The primary responsibility is on the
complainant to make specific averments as are required under the
law in the complaint so as to make the accused vicariously liable.
For fastening criminal liability on an officer of a company, there is
no presumption that every officer of a company knows about the
transaction in question.
14. The allegations which find place against the appellants herein
in their personal capacity seem to be absolutely vague. When a
complainant intends to rope in a Managing Director or any officer of
a company, it is essential to make requisite allegations to constitute
the vicarious liability.
15. When jurisdiction is exercised on a complaint petition filed in terms
of Section 156(3) or Section 200 of the CrPC, the Court concerned
should remain vigilant & apply its mind carefully before taking
cognizance of a complaint of the present nature.
16. The High Court failed to pose unto itself the correct question i.e.,
as to whether the complaint even if given face value and taken
to be correct in its entirety would lead to the conclusion that the
appellants herein were personally liable for the offence under
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Section 4 of the Act, 1900 made punishable under Section 19 of

the Act, 1900.
17. In Maharashtra State Electricity Distribution Company Limited and
Anr., v. Datar Switchgear Limited and Ors., as reported in (2010) 10
SCC 479, wherein, the Chairman of the Maharashtra State Electricity
Board was made an accused for the offence under Sections 192
and 199 respectively read with Section 34 of the IPC, this Court
observed thus:
“30. It is trite law that wherever by a legal fiction the
principle of vicarious liability is attracted and a person who
is otherwise not personally involved in the commission
of an offence is made liable for the same, it has to be
specifically provided in the statute concerned. In our
opinion, neither Section 192 IPC nor Section 199 IPC
incorporate the principle of vicarious liability, and therefore,
it was incumbent on the complainant to specifically aver
the role of each of the accused in the complaint. It would
be profitable to extract the following observations made
in S.K. Alagh: (SCC p.667, para 19)
“19. As, admittedly, drafts were drawn in the name of
the company, even if the appellant was its Managing
Director, he cannot be said to have committed an
offence under Section 406 of the Penal Code. If and
when a statute contemplates creation of such a legal
fiction, it provides specifically therefor. In absence of
any provision laid down under the statute, a Director
of a company or an employee cannot be held to be
vicariously liable for any offence committed by the
company itself.”
(Emphasis supplied)
18. In such circumstances, referred to above, no case could be said to
have been made out for putting the three appellants to trial for the
alleged offence. The Court concerned could not have issued process
for the alleged offence.
19. In view of the aforesaid, this appeal succeeds and is hereby allowed.
The impugned complaint and order taking cognizance of the said
complaint is hereby quashed.
[2025] 1 S.C.R.  461

Sanjay Dutt & Ors. v. The State of Haryana & Anr.

20. We clarify that if it is the case of the department that the company
has committed any breach or violation of any of the conditions
imposed at the time of grant of license, then it is always open for
authority concerned to proceed against the company for violation of
such terms and conditions.
21. Pending application(s), if any, stand disposed of.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Ankit Gyan
 [2025] 1 S.C.R. 462 : 2025 INSC 55

Rina Kumari @ Rina Devi @ Reena

v.
Dinesh Kumar Mahto @ Dinesh Kumar Mahato and another
(Criminal Appeal No. 161 of 2025)
10 January 2025
[Sanjiv Khanna, CJI and Sanjay Kumar,* JJ.]

Issue for Consideration

Will a husband, who secures a decree for restitution of conjugal
rights, stand absolved of paying maintenance to his wife by virtue
of Section 125(4), Code of Criminal Procedure, 1973, if his wife
refuses to abide by the said decree and return to the matrimonial
home.

Headnotes†
Code of Criminal Procedure, 1973 – s.125(4) – Disqualification
under, when not attracted – Wife’s right to maintenance u/s.125,
CrPC – Hindu Marriage Act, 1955 – s.9 – Decree for restitution
of conjugal rights obtained by respondent No.1-husband –
Non-compliance therewith by the appellant-wife – If would be
sufficient to attract the disqualification u/s.125(4):
Held: No – Mere passing of a decree for restitution of conjugal
rights at the husband’s behest and non-compliance therewith by the
wife would not, by itself, be sufficient to attract the disqualification
u/s.125(4) or be determinative straightaway of her right to
maintenance – It would depend on the facts of each case to be
decided, on the evidence available, whether the wife still had valid
and sufficient reason to refuse to live with her husband, despite
such a decree – Restitution decree was passed on 23.04.2022 –
Admittedly, there was no attempt made at reconciliation after 2017 –
However, having secured the restitution decree, respondent No.1
did nothing – He neither sought execution of the decree or a decree
of divorce – The stalemate created by Respondent No.1 reflects
his lack of bonafides and demonstrates his attempt to disown all
responsibility towards his wife – His conduct in completely ignoring
the appellant after she suffered the miscarriage of their child added
to her suffering due to the ill-treatment in her matrimonial home –
Respondent No.1’s admission that he did not bear the expenditure
* Author
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for her treatment and her unrebutted assertion that he did not take
her to the hospital or even come from Ranchi to see her were clear
indicia of the pain and mental cruelty meted out to her – Therefore,
she had just cause to not return to her matrimonial home, despite
the restitution decree – Appellant had more than sufficient reason
to stay away from the society of Respondent No.1 – Hence, her
refusal to live with him, notwithstanding the passing of a decree
for restitution of conjugal rights cannot be held against her – The
disqualification u/s.125(4), CrPC was thus, not attracted – High
Court erred in applying the same holding that the appellant was
not entitled to the maintenance granted to her by the Family
Court – Impugned judgment set aside – Order of the Family Court
restored. [Paras 29, 35, 37-39]

Code of Criminal Procedure, 1973 – Maintenance proceedings –

Nature:
Held: Even if non-compliance with an order for payment of
maintenance entails penal consequences, like other decrees of
a Civil Court, such proceedings would not qualify as or become
criminal proceedings – Nomenclature of maintenance proceedings
initiated under the Code of Criminal Procedure, as those provisions
find place therein, cannot be held to be conclusive as to the nature
of such proceedings. [Para 30]
Code of Criminal Procedure, 1973 – Maintenance – Statutory
scheme – Discussed. [Paras 8, 9]
Words and Phrases – Mental cruelty; “Judgments in rem”;
“Judgments in personam” – Evidence Act, 1872 – ss.40-43 –
Bharatiya Sakshya Adhiniyam, 2023 – ss.34-37 – Discussed.
[Paras 32, 33, 36]

Case Law Cited

Chaturbhuj v. Sita Bai, 2007 INSC 1190 : [2007] 12 SCR 577 :
(2008) 2 SCC 316; Bhuwan Mohan Singh v. Meena and Others,
2014 INSC 490 : [2014] 8 SCR 858 : (2015) 6 SCC 353; Badshah v.
Urmila Badshah Godse and Another, 2013 INSC 703 : [2013] 10
SCR 259 : (2014) 1 SCC 188; Rajnesh v. Neha and Another 2020
INSC 631 : [2020] 13 SCR 1093 : (2021) 2 SCC 324; Shamima
Farooqui v. Shahid Khan, 2015 INSC 283 : [2015] 4 SCR 137 :
(2015) 5 SCC 705; Kirtikant D. Vadodaria v. State of Gujarat and
Another [1996] Supp. 2 SCR 45 : (1996) 4 SCC 479; Amrita
464 [2025] 1 S.C.R.

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Singh v. Ratan Singh and Another (2018) 17 SCC 737; Shanti

Kumar Panda v. Shakuntala Devi, 2003 INSC 596 : [2003] Supp.
5 SCR 98 : (2004) 1 SCC 438; Mst. Jagir Kaur and Another v.
Jaswant Singh [1964] 2 SCR 73 : AIR 1963 SC 1521; Iqbal Singh
Marwah and Another v. Meenakshi Marwah and Another [2005] 2
SCR 708 : (2005) 4 SCC 370; K.G. Premshankar v. Inspector of
Police and Another [2002] Supp. 2 SCR 350 : (2002) 8 SCC 87;
Captain Ramesh Chander Kaushal v. Mrs. Veena Kaushal and
Others [1978] 3 SCR 782 : (1978) 4 SCC 70; Parveen Mehta v.
Inderjit Mehta (2002) 5 SCC 706; Rohtash Singh v. Ramendri
(Smt.) and Others, 2000 INSC 115 : [2000] 2 SCR 58 : (2000)
3 SCC 180 – referred to.
K. Narayana Rao v. Bhagyalakshmi, 1983 SCC OnLine Kar 190 :
(1984) 1 Kant LJ 451 : 1984 Cri LJ 276 (Kant); Fakruddin
Shamsuddin Saiyed v. Bai Jenab, AIR 1944 Bom 11; Sampuran
Singh v. Gurdev Kaur and Another, 1985 Cri LJ 1072 (P&H);
Amina Mohammedali Khoja v. Mohammedali Ramjanali Khoja
and Another, 1985 SCC OnLine Bom 99 : 1985 Cri LJ 1909;
Kavungal Kooppakkattu Zeenath v. Mundakkattu Sulfiker Ali, 2008
SCC OnLine Ker 78 : (2008) 3 KLJ 331; Subal Das v. Mousumi
Saha (Das) and Another, 2017 SCC OnLine Tri 175; Babita v.
Munna Lal, 2022 SCC OnLine Del 4933; Shri Mudassir v. Shirin
and Others Criminal Revision Application No. 268 of 2022, decided
on 09.02.2023; Smt. S.R. Ashwini v. G. Harish, NC: 2024: KHC:
14466 : RPFC No.104 of 2018; Girishbhai Babubhai Raja v.
Smt. Hansaben Girishchandra and Another, 1985 SCC OnLine
Guj 161 : (1986) GLH 778; Hem Raj v. Urmila Devi and Others,
1996 SCC OnLine HP 116 : (1997) 1 HLR 702; Ravi Kumar v.
Santosh Kumari, 1997 SCC OnLine P&H 529 : (1997) 3 RCR
(Cri) 3 (DB) – referred to.

List of Acts
Code of Criminal Procedure, 1973; Hindu Marriage Act, 1955;
Evidence Act, 1872; Civil Procedure Code, 1908; Bharatiya Sakshya
Adhiniyam, 2023.

List of Keywords
Decree for restitution of conjugal rights; Non-compliance;
Maintenance; Absolved; Section 125 of the Code of Criminal
Procedure, 1973; Wife’s right to maintenance; Disqualification
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under Section 125(4) of the Code of Criminal Procedure, 1973;

Family Court; Suit for restitution; Refusal to live with husband;
Refusal/desertion; Reconciliation; Lack of bonafides; Matrimonial
home; Mental cruelty; Responsibility towards his wife; Miscarriage;
Ill-treatment; Just cause; More than sufficient reason; Stay
away from the society of husband; Maintenance proceedings;
Nomenclature; Criminal proceedings; Mental cruelty; “Judgments
in rem”; “Judgments in personam”.

Case Arising From

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
161 of 2025
From the Judgment and Order dated 04.08.2023 of the High Court
of Jharkhand at Ranchi in CRR No. 440 of 2022

Appearances for Parties

Ms. Mohini Priya, Ms. Sayesha Gambhir, Advs. for the Appellant.
Anup Kumar, Ms. Pragya Choudhary, Mrs. Neha Jaiswal, Shivam
Kumar, Ms. Shruti Singh, Vaibhav Prasad Deo, Vishnu Sharma,
Ms. Madhusmita Bora, Shiv Ram Sharma, Pawan Kishore Singh,
Dipankar Singh, Mrs. Anupama Sharma, Advs. for the Respondents.

Judgment / Order of the Supreme Court

Judgment

Sanjay Kumar, J.

1. Leave granted.
2. Will a husband, who secures a decree for restitution of conjugal
rights, stand absolved of paying maintenance to his wife by virtue of
Section 125(4) of the Code of Criminal Procedure, 1973, if his wife
refuses to abide by the said decree and return to the matrimonial
home?
3. This intriguing question was answered in the affirmative by a learned
Judge of the Jharkhand High Court, vide order dated 04.08.2023 in
Criminal Revision No. 440 of 2022. Aggrieved, Rina Kumari @ Rina
Devi @ Reena, the wife, is in appeal.
466 [2025] 1 S.C.R.

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4. The appellant, Reena, and respondent No. 1, Dinesh Kumar

Mahto @ Dinesh Kumar Mahato, were married on 01.05.2014.
They parted ways in August, 2015, and Reena started living at her
parental home. Original (MTS) Suit No. 495 of 2018 was instituted
by Dinesh on 20.07.2018 before the Family Court, Ranchi, under
Section 9 of the Hindu Marriage Act, 1955, for restitution of conjugal
rights. Reena contested the suit by filing her written statement on
25.04.2019. Dinesh claimed that Reena left the matrimonial home on
21.08.2015 and did not return thereafter. According to him, attempts
were made during August and October, 2017, to bring her back but
she refused to come. He stated that his parents were very old and
needed to be taken care of but Reena was not there to do so. On
the contrary, Reena asserted that she was subjected to torture and
mental agony by Dinesh, who demanded ₹5 lakh to purchase a four-
wheeler. She alleged that he had extramarital relations. Further, she
stated that she suffered a miscarriage on 28.01.2015 but Dinesh did
not even come to see her from his workplace at Ranchi and it was
her brother who took her to Dhanbad for medical care. She claimed
that it was Dinesh who persuaded her to go to her parental home
in August, 2015, on the occasion of Raksha Bandhan and he never
truly tried to bring her back thereafter. She claimed that it was she
who had gone to her matrimonial home in the year 2017 along with
her relations but they were forced to return as Dinesh and his family
members treated them badly. She stated that she was ready to
return to her matrimonial home if Dinesh did not demand money to
purchase a car and if she was not ill-treated by him and his family
members. Her further conditions were that she should be allowed to
use the washroom/toilet in the house, as she was not allowed to do
so earlier, and she should also be allowed to use an LPG stove to
prepare food, as she had to do so by using wood and coal hitherto.
She concluded her written statement by asserting that the suit for
restitution filed by Dinesh was nothing but a tool to save himself
from the effect of laws which were put in place for women’s safety
and prayed that the suit be dismissed with costs. Reena, despite
filing the above written statement, failed to appear thereafter before
the Family Court.
5. By judgment dated 23.04.2022, the learned Additional Principal
Judge-II, Additional Family Court, Ranchi, decreed Dinesh’s suit
for restitution of conjugal rights. Therein, it was noted that Dinesh
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had attempted to bring his wife back only once but, relying on the
evidence of his witnesses, the Family Court concluded that he
wanted to live with her as husband and wife. As no evidence was
adduced by Reena, the Family Court held against her as regards her
allegation that Dinesh demanded ₹5 lakh to purchase a car and her
allegation of ill treatment and torture by him and his family members.
As to her two conditions, the Family Court noted that Dinesh was a
Junior Lineman in Jharkhand State Electricity Board and observed
that he would be expected to provide an LPG stove to his wife to
prepare food. Opining that there must be something more serious
than the ordinary wear and tear of married life for a wife to withdraw
from the society of her husband, the Family Court held in Dinesh’s
favour. He was, however, directed to ensure the respect and dignity
of his wife and to see that her conditions with regard to cooking and
toilet facilities were complied with. Reena was directed to resume
conjugal life with Dinesh within two months. Admittedly, Reena did
not abide by this decree.
6. Significantly, in the meanwhile, on 10.08.2018, Reena lodged a
complaint under Section 498A IPC against Dinesh, in C.P. Case No.
3270 of 2018. As a result of this, he was sent to prison and was
consequently suspended from service for some time. The case is
stated to be pending. Thereafter, on 03.08.2019, Reena instituted
Original Maintenance Case No. 454 of 2019 against Dinesh seeking
maintenance under Section 125 of the Code of Criminal Procedure,
1973 (for brevity, ‘the Cr.P.C.’). This case was allowed by the learned
Principal Judge, Family Court, Dhanbad, vide order dated 15.02.2022,
i.e., before the decretal of Dinesh’s suit for restitution. Therein, the
Family Court noted Dinesh’s stand that he was ready and willing to
keep Reena with full dignity but held, on the evidence adduced, that
she was entitled to maintenance. Dinesh’s pay-slip (Ex-3) revealed
that he was working as a Junior Engineer in the Electricity Board and
his net salary, after deductions from the gross salary of ₹62,000/-,
was ₹43,211/-. The Family Court held that Dinesh, despite having
sufficient means, had neglected to maintain his wife, who was unable
make ends meet on her own. The petition was accordingly allowed
and Dinesh was directed to pay ₹10,000/- per month to Reena
towards maintenance. Such maintenance was held payable from
the date of the application, i.e., 03.08.2019, and the arrears were
directed to be paid within two months.
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7. Challenging this order, Dinesh filed Criminal Revision No. 440 of

2022 before the Jharkhand High Court. A learned Judge allowed
the revision by the impugned judgment dated 04.08.2023. Therein,
the learned Judge noted that Reena, who deposed as PW-1,
was not even cross-examined by Dinesh. Similarly, the other two
witnesses who appeared on her behalf were also not subjected to
cross-examination. In her deposition, Reena asserted that she was
not working and this was confirmed by her brother, Dilip Kumar
Mahato (PW-3), who stated that she was completely dependent
upon him. Dinesh, in his own cross-examination, denied that it
was due to his assault that his wife suffered a miscarriage. He
also denied that he had demanded ₹5 lakh in dowry. He, however,
admitted that Reena suffered an abortion and that he did not bear
any expense in that regard. It was submitted on behalf of Dinesh,
that he was ready to pay ₹5,000/- per month to Reena, but not
from the date of filing of the maintenance petition, as he was
suspended from service during that period owing to his being in
judicial custody in relation to the Section 498A IPC case instituted
by her. The learned Judge, however, noted that there was a specific
finding in the judgment dated 23.04.2022 in Original (MTS) Suit
No. 495 of 2018 that Reena had withdrawn from her husband’s
society without reasonable excuse and that she had not returned
to the matrimonial home despite the said decree for restitution of
conjugal rights, which she had not even chosen to challenge by
way of appeal. The learned Judge, therefore, reasoned that Section
125(4) Cr.P.C. would come to Dinesh’s aid and, in consequence,
Reena would not be entitled to maintenance. Hence, the learned
Judge allowed the revision.
8. Before proceeding to consider the matter on merits, it would be
apposite to take note of the statutory scheme. Chapter IX of the
Code of Criminal Procedure, 1973, is titled ‘Order for Maintenance
of Wives, Children and Parents’ and comprises Sections 125 to
128. Section 125(1) Cr.P.C. provides to the effect that, if any person
having sufficient means neglects or refuses to maintain his wife or his
legitimate or illegitimate children, falling in the prescribed categories,
or his parents, who are all unable to maintain themselves, a Magistrate
of the first class may, upon proof of such neglect or refusal, order
such person to pay a monthly allowance, as thought fit, for their
maintenance. Notably, Section 125 Cr.P.C. is not of recent origin. It
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is analogous to and in continuance of Section 488 of the erstwhile

Code of Criminal Procedure, 1898.
9. In its 41st Report submitted on 24th September, 1969, the Law
Commission of India, while adverting to Section 488 of the Code
of Criminal Procedure, 1898, observed that the primary justification
for placing provisions relating to maintenance of wives and children,
which is a civil matter, in the Criminal Procedure Code was that a
remedy, speedier and more economical than that available in the
Civil Courts, is provided to them. The Law Commission noted that
the provision was aimed at preventing starvation and vagrancy,
leading to commission of crime.
10. On the same lines, in Chaturbhuj vs. Sita Bai,1 this Court observed
that the object of maintenance proceedings is not to punish a person
for his neglect but to prevent the vagrancy and destitution of a deserted
wife, by providing her food, clothing and shelter by a speedy remedy.
It was held that Section 125 Cr.P.C. is a measure of social justice,
especially enacted to protect women and children, falling within the
constitutional sweep of Article 15(3) reinforced by Article 39 of the
Constitution. Thus, the objective of the provision, then and now, is
to alleviate the financial plight of destitute wives, children and now,
parents, who are left to fend for themselves.
11. In Bhuwan Mohan Singh vs. Meena and others,2 this Court
observed that Section 125 Cr.P.C. was conceived to ameliorate the
agony, anguish and financial suffering of a woman, who left her
matrimonial home for the reasons provided in the provision, so that
some suitable arrangement can be made by the Court and she can
sustain herself and also her children, if they are with her. It was held
that the concept of sustenance did not necessarily mean ‘to lead
the life of an animal, feel like an unperson to be thrown away from
grace and roam for her basic maintenance somewhere else’ and
the wife would be entitled in law to lead a life in a similar manner
as she would have lived in the house of her husband. This Court
further cautioned that, in a proceeding of this nature, the husband
cannot be permitted to take subterfuge to deprive the wife of the

1 [2007] 12 SCR 577 : (2008) 2 SCC 316

2 [2014] 8 SCR 858 : (2015) 6 SCC 353
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benefits of living with dignity and there could be no escape route,

unless there is an order from the Court that the wife is not entitled to
get maintenance from the husband on legally permissible grounds.
12. Earlier, in Badshah vs. Urmila Badshah Godse and another,3 this
Court held that the provision of maintenance aims at empowering
the destitute and achieving social justice or equality and dignity of
the individual and while dealing with cases thereunder, the drift in
the approach from adversarial litigation to social context adjudication
is the need of the hour. More recently, in Rajnesh vs. Neha and
another,4 this Court emphasized that maintenance laws were enacted
as a measure of social justice to provide recourse to dependent
wives and children for their financial support, so as to prevent them
from falling into destitution and vagrancy.
13. In Shamima Farooqui vs. Shahid Khan,5 this Court noted that
the inherent and fundamental principle behind Section 125 Cr.P.C.
is the amelioration of the financial state of affairs as well as the
mental agony and anguish that a woman suffers when she is
compelled to leave her matrimonial home. It was further observed
that, as per law, she is entitled to lead life in a similar manner as
she would have lived in the house of her husband and as long as
she is held entitled to grant of maintenance within the parameters
of Section 125 Cr.P.C., it has to be adequate so that she can live
with dignity. Lastly, it was noted that, a plea is sometimes advanced
by the husband that he does not have the means to pay as he
does not have a job or his business is not doing well, but these
are only bald excuses and, in fact, they have no acceptability in
law as a husband, who is healthy, able-bodied and in a position
to support himself is under a legal obligation to support his wife
and her right to receive maintenance under Section 125 Cr.P.C.,
unless disqualified, is an absolute right.
14. Such disqualification, by way of an exception, was envisaged under
Section 488(4) of the old Code, which is replicated, almost verbatim,
in Section 125(4) Cr.P.C. It reads thus:

3 [2013] 10 SCR 259 : (2014) 1 SCC 188

4 [2020] 13 SCR 1093 : (2021) 2 SCC 324
5 [2015] 4 SCR 137 : (2015) 5 SCC 705
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“Section 125
(4) No wife shall be entitled to receive an [allowance for
the maintenance or the interim maintenance and expenses
of proceeding, as the case may be,] [Substituted by Act
50 of 2001, Section 2 for “allowance” (w.e.f. 24-9-2001)]
from her husband under this section if she is living in
adultery, or if, without any sufficient reason, she refuses
to live with her husband, or if they are living separately
by mutual consent.”
15. The issue, presently, turns upon the applicability of Section 125(4)
Cr.P.C. to the case on hand. The question as to whether non-
compliance with a decree for restitution of conjugal rights by a
wife would be sufficient in itself to deny her maintenance, owing to
Section 125(4) Cr.P.C, has been addressed by several High Courts
but no consistent view is forthcoming, as their opinions were varied
and conflicting.
16. In K. Narayana Rao vs. Bhagyalakshmi,6 the Karnataka High
Court observed that the Court dealing with a maintenance claim
under Section 125 Cr.P.C. has to carefully examine and take into
consideration the decree for restitution of conjugal rights which has
not been complied with by the wife but it would not be bound by
all the findings therein, including findings on questions, such as,
whether the wife withdrew from the society of the husband; desertion
on her part; or her leading an adulterous life. Reference was made
to Fakruddin Shamsuddin Saiyed vs. Bai Jenab,7 wherein the
Bombay High Court had held that the Magistrate should not ‘surrender
his own discretion’ simply because the husband was armed with a
decree for restitution of conjugal rights.
17. In Sampuran Singh vs. Gurdev Kaur and another,8 the Punjab &
Haryana High Court observed that a wife can still claim maintenance
in the presence of a decree for restitution of conjugal rights if the
conduct of the husband is such that it obstructs her from obeying
the decree.

6 1983 SCC OnLine Kar 190 = (1984) 1 Kant LJ 451 : 1984 Cri LJ 276 (Kant)
7 AIR 1944 Bom 11
8 Criminal Revision No. 1562 of 1983, decided on 17.01.1985 : 1985 Cri LJ 1072 (P&H)
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18. In Amina Mohammedali Khoja vs. Mohammedali Ramjanali

Khoja and another,9 the Bombay High Court noted that an order of
maintenance can always be passed in favour of a wife even if her
husband obtained a decree for restitution of conjugal rights, unless
it is established that she willfully deserted her husband and was
not willing to stay with him without reasonable cause or sufficient
reason. On facts, it was found that the record did not show that
the wife had deserted the husband and was unwilling to stay with
him without reasonable cause or sufficient reasons. It was further
noted that, after obtaining the decree, the husband had not taken
any effective steps to get the decree satisfied as he had made no
genuine, honest and sincere efforts to see that his wife comes back
to him. It was, therefore, held that he was only interested in a paper
decree for restitution of conjugal rights, which he had gotten ex parte.
19. In Kavungal Kooppakkattu Zeenath vs. Mundakkattu Sulfiker
Ali,10 the Kerala High Court noted that the expression used in Section
125(4) Cr.P.C. is ‘refusal’ and not ‘failure’ to live with the husband and
that there is evidently some difference between the two. It was held
that ‘failure’ would mean not doing something that one is expected
to do but ‘refusal’ would mean saying or showing that one would not
do or accept something which is offered. In effect, if a husband says
he is willing to do something for the wife but she states or shows
that she does not want or accept that something which is offered to
her, then only there is refusal.
20. In Subal Das vs. Mousumi Saha (Das) and another,11 the Tripura
High Court held that a wife who refuses to comply with a decree for
restitution of conjugal rights cannot be deprived of maintenance under
Section 125(4) Cr.P.C. It was observed that it would be incongruent
to assume that a wife against whom a decree for restitution has
been passed is disentitled to maintenance while a wife who has
been divorced can still claim the same. It was further observed
that the Civil Court’s judgment for restitution can only be treated
as relevant evidentiary material but the conduct of the wife, i.e.,
whether she had sufficient reason to refuse to live with the husband,

9 985 SCC OnLine Bom 99 : 1985 Cri LJ 1909

10 2008 SCC OnLine Ker 78 : (2008) 3 KLJ 331
11 2017 SCC OnLine Tri 175 : Criminal Revision Petition No. 89 of 2016, decided on 25.07.2017
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has to be assessed by the Magistrate and only thereafter, it could

be decided whether she would be entitled to maintenance or not. It
was concluded that the restriction imposed by Section 125(4) Cr.P.C.
had been substantially diluted, if not virtually negated.
21. In Babita vs. Munna Lal,12 the Delhi High Court opined that an ex
parte decree for restitution of conjugal rights would not automatically
put an end to the wife’s right to maintenance under Section 125 Cr.P.C.
It was held that, even if such a case is contested by the wife and
is decided in the husband’s favour, non-compliance therewith could
be taken to be a ground to deny maintenance, provided the Court is
satisfied on the strength of evidence that the wife had no justifiable
grounds to stay away from the husband. The mere presence of a
decree for restitution of conjugal rights was, therefore, held insufficient
to disentitle a wife from claiming maintenance, if the conduct of the
husband is such that she is unable to obey such a decree or if the
husband creates such circumstances that she cannot stay with him.
It was noted that even a divorced wife is entitled to maintenance
under Section 125 Cr.P.C. and it would be improper and unfair to
deny maintenance to a wife merely because she refused to cohabit
with the husband, despite having sufficient grounds therefor.
22. In Shri Mudassir vs. Shirin and others,13 the Bombay High Court
noted that mere readiness and willingness on the part of the husband
to cohabit with the wife would not be sufficient to absolve him of the
liability to pay maintenance, by projecting that the wife left his company
without sufficient reason. It was held that if the grounds justified the
wife and children staying away from the husband, Section 125(4)
Cr.P.C. would have no application.
23. In its recent judgment in Smt. S.R. Ashwini vs. G. Harish,14 the
Karnataka High Court held that there is nothing in law to bar the
grant of maintenance under Section 125 Cr.P.C. even if a decree for
restitution of conjugal rights is secured by the husband. It was noted
that, at the most, such a decree would enable the husband to take
that defence in the maintenance proceedings initiated by the wife but,
for the Court, it would not be the sole factor to refuse maintenance

12 2022 SCC OnLine Del 4933 : Criminal Revision Petition No. 1001 of 2018, decided on 22.08.2022
13 Criminal Revision Application No. 268 of 2022, decided on 09.02.2023
14 NC: 2024: KHC: 14466 : RPFC No.104 of 2018, decided on 23.02.2024
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to her. In the result, it was held that a petition under Section 125
Cr.P.C. could be considered on its own merits independently, without
being influenced by the decree for restitution of conjugal rights. It was
further held that, even if there is a decree for restitution of conjugal
rights, and the wife still does not choose to join the matrimonial home
that would not amount to voluntary refusal/desertion which would
bar her claim to maintenance under Section 125 Cr.P.C.
24. On the other hand, the Gujarat High Court, in Girishbhai Babubhai
Raja vs. Smt. Hansaben Girishchandra and another,15 observed
that when the Civil Court orders the wife to go and stay with her
husband and fulfil her marital obligations, it presupposes that she has
no justification to be away from the husband and refuse to perform
her corresponding marital obligations.
25. A similar view was taken by the Himachal Pradesh High Court
in Hem Raj vs. Urmila Devi and others,16 wherein it was held
that, once a Civil Court found in a contested proceeding that the
wife had no just or reasonable cause to withdraw her society from
the husband, she cannot claim maintenance under Section 125
Cr.P.C. It was observed, on facts, that the wife had not pleaded any
subsequent event or circumstance which justified her staying away
from her husband in spite of the decree for restitution of conjugal
rights passed against her.
26. On the same lines, in Ravi Kumar vs. Santosh Kumari,17 a Division
Bench of the Punjab & Haryana High Court held that a wife against
whom a decree for restitution of conjugal rights has been passed
by the Civil Court would not be entitled to claim maintenance under
Section 125 Cr.P.C. if, in the proceedings of restitution, a specific issue
was framed as to whether the wife refused to live with her husband
without sufficient reason and the parties were given an opportunity
to lead evidence, whereupon specific findings were recorded by the
Civil Court against the wife on the issue. It was, however, added
that in the event the husband got an ex parte decree for restitution,
such a decree would not be binding on the Criminal Court exercising
jurisdiction under Section 125 Cr.P.C. It was also clarified that if the

15 1985 SCC OnLine Guj 161 : (1986) GLH 778

16 1996 SCC OnLine HP 116 : (1997) 1 HLR 702
17 1997 SCC OnLine P&H 529 : (1997) 3 RCR (Cri) 3 (DB)
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decree for restitution of conjugal rights was obtained by the husband

subsequent to the order for maintenance passed by the Magistrate
under Section 125 Cr.P.C., then the decree would not ipso facto
disentitle the wife to her right to maintenance and the husband
would have to approach the Magistrate to get the order granting
maintenance cancelled.
27. Now, turning to the decisions of this Court on the point, in Kirtikant
D. Vadodaria vs. State of Gujarat and another,18 it was held that
Section 125 Cr.P.C. has to be given a liberal construction to fulfil and
achieve the intention of the legislature and, therefore, the passing
of a decree for restitution of conjugal rights against the wife would
not, by itself, defeat her right to maintenance under Section 125(1)
Cr.P.C. It was further observed that the mere ‘failure’ of the wife to
live with her husband would not be sufficient to disentitle her from
receiving maintenance from him, especially as the crucial word
carefully chosen in the relevant provision is ‘refusal’.
28. In Amrita Singh vs. Ratan Singh and another,19 this Court held,
on facts, that the plea of the husband that his wife had deserted him
without reasonable cause and that he was ready to take her back
was falsified by the fact that the wife was treated with cruelty and
subjected to persistent demands for dowry, resulting in her being
ousted from the matrimonial house, whereupon she was compelled
to file a criminal complaint under Section 498A IPC ending in the
conviction of the husband and his father. The wife was held to have
reasonable grounds not to join the husband, thereby entitling her
to maintenance.
29. Thus, the preponderance of judicial thought weighs in favour of
upholding the wife’s right to maintenance under Section 125 Cr.P.C.
and the mere passing of a decree for restitution of conjugal rights
at the husband’s behest and non-compliance therewith by the wife
would not, by itself, be sufficient to attract the disqualification under
Section 125(4) Cr.P.C. It would depend on the facts of the individual
case and it would have to be decided, on the strength of the material
and evidence available, whether the wife still had valid and sufficient
reason to refuse to live with her husband, despite such a decree.

18 [1996] Supp. 2 SCR 45 :(1996) 4 SCC 479

19 (2018) 17 SCC 737
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There can be no hard and fast rule in this regard and it must invariably
depend on the distinctive facts and circumstances obtaining in each
particular case. In any event, a decree for restitution of conjugal
rights secured by a husband coupled with non-compliance therewith
by the wife would not be determinative straightaway either of her
right to maintenance or the applicability of the disqualification under
Section 125(4) Cr.P.C.
30. Another contention that was urged before us is that the findings in the
judgment for restitution of conjugal rights by the Family Court, being a
Civil Court, would be binding on the Court seized of the petition under
Section 125 Cr.P.C, as they are to be treated as criminal proceedings.
This specious argument needs mention only to be rejected outright.
No doubt, in Shanti Kumar Panda vs. Shakuntala Devi,20 this Court
held that a decision by a Criminal Court would not bind the Civil Court
while a decision by the Civil Court would bind the Criminal Court.
However, maintenance proceedings are essentially civil in nature and
the reason for inclusion of the provisions dealing therewith in the Code
of Criminal Procedure was clarified by the Law Commission of India
in September, 1969. Significantly, as long back as in the year 1963,
in Mst. Jagir Kaur and another vs. Jaswant Singh,21 a 3-Judge
Bench of this Court held that proceedings under Section 488 of the
Code of Criminal Procedure, 1898, the precursor to Section 125
Cr.P.C., are in the nature of civil proceedings; the remedy, being a
summary one; and the person seeking that remedy, ordinarily being
a helpless person. Therefore, even if non-compliance with an order
for payment of maintenance entails penal consequences, as may
other decrees of a Civil Court, such proceedings would not qualify
as or become criminal proceedings. Nomenclature of maintenance
proceedings initiated under the Code of Criminal Procedure, as those
provisions find place therein, cannot be held to be conclusive as to
the nature of such proceedings.
31. Further, in Iqbal Singh Marwah and another vs. Meenakshi Marwah
and another,22 while dealing with the contention that an effort should
be made to avoid conflict of findings between Civil and Criminal

20 (2004) 1 SCC 438

21 [1964] 2 SCR 73 : AIR 1963 SC 1521
22 [2005] 2 SCR 708 : (2005) 4 SCC 370
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Courts, a Constitution Bench pointed out that there is neither any

statutory provision nor any legal principle that the findings recorded
in one proceeding may be treated as final or binding in the other,
as both the cases have to be decided on the basis of the evidence
adduced therein.
32. The Indian Evidence Act, 1872, distinguishes between judgments
in rem and judgments in personam and Sections 40 to 43 therein
stipulates the relevance of existing judgments, orders or decrees in
subsequent proceedings in different situations. The relevant provisions
are extracted hereunder for ready reference:
40. Previous judgments relevant to bar a second suit
or trial: -
The existence of any judgment, order or decree which
by law prevents any Court from taking cognizance
of a suit or holding a trial is a relevant fact when
the question is whether such Court ought to take
cognizance of a such suit, or to hold such trial.
41. Relevancy of certain judgments in probate, etc.,
jurisdiction: -
A final judgment, order or decree of a competent Court,
in the exercise of probate, matrimonial admiralty or
insolvency jurisdiction which confers upon or takes
away from any person any legal character, or which
declares any person to be entitled to any such
character, or to be entitled to any specific thing, not as
against any specified person but absolutely, is relevant
when the existence of any such legal character, or the
title of any such person to any such thing, is relevant.
Such judgment, order or decree is conclusive proof—
that any legal character, which it confers accrued at
the time when such judgment, order or decree came
into operation;
that any legal character, to which it declares any such
person to be entitled, accrued to that person at the
time when such judgment, [order or decree] declares
it to have accrued to that person;
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that any legal character which it takes away from

any such person ceased at the time from which
such judgment, [order or decree] declared that it had
ceased or should cease;
and that anything to which it declares any person to
be so entitled was the property of that person at the
time from which such judgment, [order or decree]
declares that it had been or should be his property.
42. Relevancy and effect of judgments, orders or
decrees, other than those mentioned in section 41: -
Judgments, orders or decrees other than those
mentioned in section 41, are relevant if they relate to
matters of a public nature relevant to the enquiry; but
such judgments, orders or decrees are not conclusive
proof of that which they state.
Illustration:
A sues B for trespass on his land. B alleges the
existence of a public right of way over the land,
which A denies.
The existence of a decree in favour of the defendant,
in a suit by A against C for a trespass on the same
land in which C alleged the existence of the same
right of way, is relevant, but it is not conclusive proof
that the right of way exists.
43. Judgments, etc., other than those mentioned in
sections 40 to 42, when relevant. -
Judgments, orders or decrees, other than those
mentioned in sections 40, 41 and 42, are irrelevant,
unless the existence of such judgment, order or
decree, is a fact in issue, or is relevant under some
other provisions of this Act.
Illustrations
(a) A and B separately sue C for a libel which
reflects upon each of them. C in each case says,
that the matter alleged to be libellous is true, and
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the circumstances are such that it is probably true

in each case, or in neither.
A obtains a decree against C for damages on the
ground that C failed to make out his justification. The
fact is irrelevant as between B and C.
(b) A prosecutes B for adultery with C, A’s wife.
B denies that C is A’s wife, but the Court convicts
B of adultery.
Afterwards, C is prosecuted for bigamy in marrying B
during A’s lifetime. C says that she never was A’s wife.
The judgment against B is irrelevant as against C.
(c) A prosecutes B for stealing a cow from him, B,
is convicted.
A afterwards sues C for the cow, which B had sold
to him before his conviction. As between A and C,
the judgment against B is irrelevant.
(d) A had obtained a decree for the possession of land
against B, C, B’s son, murders A in consequence.
The existence of the judgment is relevant, as showing
motive for a crime.
[(e) A is charged with theft and with having been
previously convicted of theft. The previous conviction
is relevant as a fact in issue.
(f) A is tried for the murder of B. The fact that B
prosecuted A for libel and that A was convicted and
sentenced is relevant under section 8 as showing
the motive for the fact in issue.
33. Sections 34 to 37 of the Bharata Sakshya Adhiniyam, 2023,
correspond to Sections 40 to 43 of the Indian Evidence Act, 1872,
with some modifications. Section 41, as is clear from the extraction
hereinabove, specifically deals with instances where an earlier
judgment, order or decree constitutes conclusive proof whereas
Section 42 provides that an earlier judgment is relevant if it relates to
matters of public nature relevant to the inquiry, but such judgments,
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orders or decrees are not conclusive proof of that which they state.
These provisions were considered in detail by a 3-Judge Bench
of this Court in K.G. Premshankar vs. Inspector of Police and
another,23 in the context of when a judgment in a civil proceeding,
on the same cause of action, would be relevant in a criminal case,
and it was observed thus:
“30. What emerges from the aforesaid discussion is –
(1) the previous judgment which is final can be relied upon
as provided under Sections 40 to 43 of the Evidence Act;
(2)..; (3)..; (4) if the criminal case and the civil proceedings
are for the same cause, judgment of the civil court would
be relevant if conditions of any of Sections 40 to 43 are
satisfied, but it cannot be said that the same would be
conclusive except as provided in Section 41. Section 41
provides which judgment would be conclusive proof of
what is stated therein.
31. Further, the judgment, order or decree passed in
previous civil proceeding, if relevant, as provided under
Sections 40 and 42 or other provisions of the Evidence Act
then in each case, the court has to decide to what extent
it is binding or conclusive with regard to the matter(s)
decided therein. … Hence, in each and every case, the first
question which would require consideration is – whether
judgment, order or decree is relevant, if relevant – its
effect. It may be relevant for a limited purpose, such as,
motive or as a fact in issue. This would depend upon the
facts of each case.”
Decisions of this Court manifest that judgments passed on merits
in civil proceedings have been accepted as sufficient cause to
discharge or acquit a person facing prosecution on the same grounds.
This dictum is applied especially in cases where civil adjudication
proceedings, like in tax cases, lead to initiation of prosecution by the
authorities. Such cases are, however, different as there is a direct
connect between the civil proceedings and the prosecution which is
launched. The facts and allegations leading to the prosecution directly
arise as a result of the civil proceedings. Moreover, the standard

23 [2002] Supp. 2 SCR 350 : (2002) 8 SCC 87

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of proof in civil proceedings is a preponderance of probabilities

whereas, in criminal prosecution, conviction requires proof beyond
reasonable doubt. We do not think the said principle can be applied
per se to proceedings for maintenance under Section 125 Cr.P.C. by
relying upon a judgment passed by a Civil Court on an application
for restitution of conjugal rights. Further, the two proceedings are
altogether independent and are not directly or even indirectly
connected, in the sense that proceedings under Section 125 Cr.P.C.
do not arise from proceedings for restitution of conjugal rights.
34. Long ago, in Captain Ramesh Chander Kaushal vs. Mrs. Veena
Kaushal and others,24 this Court noted that it is valid to assert that
a final determination of a civil right by a Civil Court would prevail
against a like decision by a Criminal Court but held that this principle
would be inapplicable when it comes to maintenance granted
under Section 24 of the Hindu Marriage Act, 1955, as opposed to
maintenance granted under Section 125 Cr.P.C. It was noted that
the latter provision was a measure of social justice specially enacted
to protect women and children falling within the constitutional sweep
of Article 15(3) reinforced by Article 39.
35. Viewed thus, the findings in the proceedings for restitution of conjugal
rights, which were partly uncontested as Reena did not appear before
the Family Court to adduce evidence or advance her case after filing
her written statement, did not clinch the issue and the High Court
ought not to have given such undue weightage to the said judgment
and the findings therein. In the process, certain crucial factors were
overlooked. Particularly, the fact that the witnesses who appeared
on behalf of Reena in the Section 125 Cr.P.C. proceedings were
not even cross-examined. It was clear therefrom that Dinesh did
not even contest or rebut what they had stated. The fact that Reena
was fully dependent on her brother was thus admitted. Further,
documents were placed on record in proof of Reena’s abortion in
January, 2015. In that regard, Dinesh’s admission that he did not
bear the expenditure for her treatment and her unrebutted assertion
that he did not take her to the hospital or even come from Ranchi
to see her were clear indicia of the pain and mental cruelty meted
out to her. The fact that she was not allowed to use the toilet in the

24 [1978] 3 SCR 782 : (1978) 4 SCC 70

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house or avail proper facilities to cook food in the matrimonial home,

facts which were accepted in the restitution proceedings, are further
indications of her ill-treatment.
36. Pertinently, in Parveen Mehta vs. Inderjit Mehta,25 this Court
held that mental cruelty is a state of mind and feeling of one of
the spouses due to the behavioral pattern by the other and, unlike
physical cruelty, mental cruelty is difficult to establish by direct
evidence. It was observed that a feeling of anguish, disappointment
and frustration in one spouse caused by the conduct of the other can
only be appreciated on cumulatively assessing the attending facts
and circumstances in which the two spouses have been living. In
a case of mental cruelty, per this Court, it would not be the correct
approach to take an instance of misbehaviour in isolation and then
pose the question whether such behaviour is sufficient by itself to
cause mental cruelty. The approach should be to take the cumulative
effect of the facts and circumstances emerging from the evidence
on record and then draw a fair inference whether the spouse has
been subjected to mental cruelty due to the conduct of the other.
37. Applying this standard, Dinesh’s conduct in completely ignoring his
wife, Reena, after she suffered the miscarriage of their child would
have been the proverbial last straw adding to her suffering due to the
ill-treatment in her matrimonial home. She, therefore, had just cause
to not return to her matrimonial home, despite the restitution decree.
Further, the events thereafter or rather, the lack thereof, is relevant.
The restitution decree came to be passed on 23.04.2022. Admittedly,
there was no attempt made at reconciliation after 2017. However,
having secured the said restitution decree, Dinesh did nothing! He
neither sought execution of the decree under Order XXI Rule 32
CPC nor did he seek a decree of divorce under Section 13(1A)(ii)
of the Hindu Marriage Act, 1955.
38. The reason for this is not far to gather. In Rohtash Singh vs.
Ramendri (Smt.) and others,26 this Court clarified that a wife, who
suffered a decree of divorce on the ground of deserting her husband,
would not be entitled to maintenance under Section 125 Cr.P.C. as
long as the marriage subsisted, but she would be entitled to such

25 (2002) 5 SCC 706

26 [2000] 2 SCR 58 : (2000) 3 SCC 180
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maintenance once she attained the status of a divorced wife, in the

light of the definition of a ‘wife’ in Explanation (b) to Section 125(1)
Cr.P.C. Dinesh, therefore, sought to protect himself from a claim
by Reena for maintenance by projecting the disobeyed restitution
decree as a defence and as long as she did not attain the status
of a divorced wife, that protection would endure to his benefit. This
stalemate of sorts created by Dinesh clearly reflects his lack of
bonafides and demonstrates his attempt to disown all responsibility
towards his wife, Reena. These factors, taken cumulatively, clearly
manifest that Reena had more than sufficient reason to stay away
from the society of her husband, Dinesh, and her refusal to live with
him, notwithstanding the passing of a decree for restitution of conjugal
rights, therefore, cannot be held against her. In consequence, the
disqualification under Section 125(4) Cr.P.C. was not attracted and
the High Court erred grievously in applying the same and holding
that Reena was not entitled to the maintenance granted to her by
the Family Court.
39. The appeal is accordingly allowed, setting aside the judgment dated
04.08.2023 passed by the High Court of Jharkhand at Ranchi in
Criminal Revision No. 440 of 2022. In consequence, the order dated
15.02.2022 passed by the learned Principal Judge, Family Court,
Dhanbad, in Original Maintenance Case No. 454 of 2019 shall
stand restored. In furtherance thereof, Dinesh, respondent No. 1
herein, shall pay maintenance @ ₹10,000/- per month to Reena,
the appellant, on or before the 10th day of each calendar month.
Such maintenance would be payable from the date of filing of the
maintenance application, i.e., 03.08.2019. Arrears of the maintenance
shall be paid by Dinesh in three equal installments, i.e., the first
instalment by 30.04.2025, the second instalment by 31.08.2025 and
the third and final instalment by 31.12.2025.
In the circumstances, parties shall bear their own costs.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Divya Pandey
 [2025] 1 S.C.R. 484 : 2025 INSC 71

Ram Pyarey
v.
The State of Uttar Pradesh
(Criminal Appeal No. 1408 of 2015)
09 January 2025
[J.B. Pardiwala and R. Mahadevan, JJ.]

Issue for Consideration

Correctness of the order of conviction against the brother-in-law for
the offences punishable u/ss.306, 498-A IPC and s.4 of the Dowry
Prohibition Act, 1961, in the absence of any cogent evidence.

Headnotes†
Evidence Act, 1872 – s.113A – Presumption as to abetment of
suicide by a married women – Invocation of s.113A – When –
Deceased died on account of severe burn injuries, by setting
herself on fire – Order of conviction and sentence of the
appellant-brother-in-law u/ss.306 and 498 IPC and s.4 of the
Dowry Prohibition Act, however, acquitted for the offence
punishable u/s.304B IPC – Correctness:
Held: When the courts below want to apply s.113A, the condition
precedent is that there has to be first some cogent evidence as
regards cruelty and harassment – In the absence of any cogent
evidence as regards harassment or abetment in any form like
aiding or instigating, the court cannot straightway invoke s.113A and
presume that the accused abetted the commission of suicide – No
evidence on the basis of which it could be said that the brother-
in-law abetted the commission of suicide – Judgment and order of
conviction passed by courts below set aside – Penal Code, 1860 –
ss.306, 498-A – Dowry Prohibition Act, 1961 – s.4. [Paras 11, 13, 14]

List of Acts
Penal Code, 1860; Dowry Prohibition Act, 1961; Code of Criminal
Procedure, 1973; Evidence Act, 1872.

List of Keywords
Abetment to suicide; Presumption as to dowry death; Presumption
as to abetment to suicide; Cogent evidence as regards harassment
or abetment.
[2025] 1 S.C.R.  485

Ram Pyarey v. The State of Uttar Pradesh

Case Arising From

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
1408 of 2015
From the Judgment and Order dated 06.08.2013 of the High Court of
Judicature at Allahabad, Lucknow Bench in CRLA No. 401 of 1993

Appearances for Parties

Bharat Bhushan, Keshav Bansal, Advs. for the Appellant.
K. Parmeshwar, Sr. Adv/A.A.G., Shaurya Sahay, Aditya Kumar,
Ms. Ruchil Raj, Advs. for the Respondent.

Judgment / Order of the Supreme Court

Order

1. This appeal arises from the judgment and order passed by the
High Court of Judicature at Allahabad, Lucknow Bench dated 6th
August, 2013 in Criminal Appeal No. 401 of 1993 by which the
High Court dismissed the appeal filed by the appellant herein
and three other co-accused and thereby affirmed the judgment
and order of conviction passed by the trial court for the offence
punishable under Sections 306 and 498-A of the Indian Penal
Code, 1860 (for short the “IPC”) and Section 4 of the Dowry
Prohibition Act, 1961.
2. It appears from the materials on record that the appellant herein is
the brother-in-law (Jeth) of the deceased. The deceased was married
to one Ram Sajeevan.
3. It is the case of the prosecution that there was harassment at the
end of the husband, in-laws and the appellant (Jeth) herein to the
deceased.
4. The deceased doused herself with kerosene and set herself on
fire on 27-09-1990. She died on account of severe burn injuries.
The father of the deceased lodged a First Information Report with
the Ajgain Police Station, District Unnao on the very same day.
The gist of the complaint lodged by the father of the deceased
reads thus:-
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“To,
SHO, Police Station Ajgain,
District Unnao:
Sir,
It is respectfully submitted that the complainant Shiv Prasad
Sahu, S/o. Laxman Sahu is resident of Village Bhakat,
P.S. Kotwali, District Unnao. That the father in law Lal
Bahadur., S/o. Jugnu, Village Sambhar Kheda, Majra
Nana Tikur, P.S. Ajgain, Distt. Unnao took my daughter
Kusum with him on 25.09.1990. That in the intervening
night of 26.09.1990 and 27.09.1990 my daughter was
killed by burning by her in-laws. Before this they were
demanding the buffalo and gold chain in dowry after
marriage. And told my daughter Kusum Devi if you will
not give the dowry then we will kill you. They threatened
her. On that I did not send her to her matrimonial house
for one year and on 25.09.1990 my daughter was
went to her matrimonial house alongwith her father
in law Lal Bahadur, Son of Jugnu. They said that she
is our responsibility. However, in the intervening night
of 26.09.1990 and 27.09.1990 at about 2.00 A.M. Lal
Bahadur, S/o. Jugnu, Ram Sajeevan, S/o. Lal Bahadur,
Ram Pyare, S/o. Lal Bahadur, Sonawati, W/o. Lal
Bahadur killed my daughter Kusum Devi by burning after
pouring kerosene oil on her.
The complaint of the complainant is against all the four
accused. Action may kindly be taken under law after
reporting the case. Will be highly greatful.
Written by Nand Kishore Sahu,
S/o. Ram Nath, village Rajepur,
P.S. and P.O. Marvi, Distt. Unnao.
Complainant Shiv Prasad Sahu
S/o. Laxman Sahu R/o. Village
Bakhat, Distt. Unnao
27.09.1990”
[2025] 1 S.C.R.  487

Ram Pyarey v. The State of Uttar Pradesh

5. On conclusion of the investigation, charge-sheet was filed for the

offence of dowry death punishable under Section 304B of the IPC,
against four accused persons which included the appellant herein.
The offence being exclusively triable by the Sessions Court was
committed under the provisions of Section 209 of the Code of
Criminal Procedure. Charges were framed against four accused
persons including the appellant herein.
6. It appears that although the original charge framed by the trial court
was one for dowry death punishable under Section 304B of the IPC
yet, the trial court acquitted all the accused persons for the offence
punishable under Section 304-B, however convicted them for the
offence of abetment of suicide punishable under Sections 306 and
498A of the IPC respectively.
7. We are informed that the father-in-law and mother-in-law passed away
while the appeal before the High Court was pending. So far as, the
husband is concerned he has already undergone the sentence as
imposed by the trial court. In fact, he did not file any appeal against
his conviction.
8. The present appellant who is the brother-in-law of the deceased is
here before us with this appeal.
9. We have heard Mr. Bharat Bhushan, the learned counsel appearing
for the appellant and Mr. K. Parmeshwar, the learned senior counsel
appearing for the State of Uttar Pradesh.
10. We have looked into the oral evidence on record. We have also
looked into the nature of the allegations levelled against the appellant
herein.
11. We are of the view that there is practically no evidence on the basis
of which it could be said that the appellant herein as brother-in-law
abetted the commission of suicide. We need not say anything further
in the matter.
12. The law as regards the abetment of suicide punishable under
Sections 306 of the IPC is now well settled. It appears that the
Courts below laid much emphasis on Section 113B of the Evidence
Act, 1872 (for short, “the Evidence Act”). Sections 113A & 113B of
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the Evidence Act talks about presumption. Sections 113A and 113B
respectively read thus:-
“113A. Presumption as to abetment of suicide by a
married woman.─ When the question is whether the
commission of suicide by a woman had been abetted
by her husband or any relative of her husband and it is
shown that she had committed suicide within a period of
seven years from the date of her marriage and that her
husband or such relative of her husband had subjected
her to cruelty, the Court may presume, having regard to
all the other circumstances of the case, that such suicide
had been abetted by her husband or by such relative of
her husband.
Explanation.─ For the purposes of this section, “cruelty”
shall have the same meaning as in section 498A of the
Indian Penal Code (45 of 1860).
113B. Presumption as to dowry death.─ When the question
is whether a person has committed the dowry death of a
woman and it is shown that soon before her death such
woman had been subjected by such person to cruelty or
harassment for, or in connection with, any demand for
dowry, the Court shall presume that such person had
caused the dowry death.
Explanation.─ For the purposes of this section, “dowry
death” shall have the same meaning as in section 304B
of the Indian Penal Code (45 of 1860).”
13. It is relevant to note that under Section 113B, the Court shall presume
dowry death unlike Section 113A where the provision says that Court
may presume abetment of suicide. This is the vital difference between
the two provisions which raises presumption as regards abetment
of suicide. When the Courts below want to apply Section 113A of
the Evidence Act, the condition precedent is that there has to be
first some cogent evidence as regards cruelty & harassment. In the
absence of any cogent evidence as regards harassment or abetment
in any form like aiding or instigating, the court cannot straightway
[2025] 1 S.C.R.  489

Ram Pyarey v. The State of Uttar Pradesh

invoke Section 113A and presume that the accused abetted the
commission of suicide.
14. In view of the aforesaid, this appeal succeeds and is hereby allowed.
The judgment and order of conviction passed by the trial court as
confirmed by the High Court is hereby set aside.
15. The appellant is already on bail. His bail bonds stand discharged.
16. Pending application(s), if any, stands disposed of.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Nidhi Jain
 [2025] 1 S.C.R. 490 : 2025 INSC 72

Dharmendra Kumar Singh & Ors.

v.
The Hon’ble High Court of Jharkhand & Ors.
(Civil Appeal No. 299 of 2025)
15 January 2025
[B.V. Nagarathna and Satish Chandra Sharma,* JJ.]

Issue for Consideration

Issue arose as regards the promotion of the Civil Judges (Senior
Division) to Jharkhand Superior Judicial Service.

Headnotes†
Judiciary – Superior judiciary – Jharkhand Superior
Judicial Service – Promotion/appointment – Notification for
appointment in the Jharkhand Superior Judicial Service –
Quota for promotion based upon merit-cum-seniority and
passing of suitability test is 65% – Appellants-promotee in
the cadre of Civil Judge (Senior Division) participated in the
selection process, however not selected – Appellants obtained
more than the cut off marks for determining suitability of
the candidate, however, persons junior to them, who had
secured more marks promoted by preparing merit list – Writ
petition by appellants – Dismissed by the High Court on the
ground that appellants scored lower than the last selected
candidate – Correctness:
Held: Suitability of each candidate has to be tested on his own
merit and a comparative assessment cannot be made and the
promotion cannot be solely based upon merit list – Appellants
successfully qualified the suitability test, they could not have
been deprived of their legitimate right of promotion only on
account of lower placement in the merit list – Appellants have
been subsequently promoted – Appellants entitled for notional
promotion from the same date the other officers from the select
list prepared by the High Court have been appointed to the post
of District Judge in terms of the Notification – Orders passed by

* Author
[2025] 1 S.C.R.  491

Dharmendra Kumar Singh & Ors. v.

The Hon’ble High Court of Jharkhand & Ors.

the High Court set aside – Jharkhand Superior Judicial Services

(Recruitment, Appointment and Condition of Service) Rules,
2001 – rr.4, 5. [Paras 4-6]

Case Law Cited

Ravikumar Dhansukhlal Maheta and Another v. High Court of
Gujarat and Others [2024] 5 SCR 1074 : 2024 SCC Online SC
972 – relied on.

List of Acts
Jharkhand Superior Judicial Services (Recruitment, Appointment
and Condition of Service) Rule, 2001.

List of Keywords
Promotion; Civil Judges (Senior Division); Jharkhand Superior
Judicial Service; Superior judiciary; Notification for appointment;
Quota for promotion based upon merit-cum-seniority; Suitability
test; Cadre of Civil Judge (Senior Division); Selection process;
Last selected candidate; Comparative assessment; Legitimate
right of promotion; Lower placement in merit list; Notional
promotion; Post of District Judge; Merit list; Select list; Limited
Competitive Examination; Suitability of candidate for promotion;
Seniority.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 299 of 2025
From the Judgment and Order dated 29.06.2022 of the High Court
of Jharkhand at Ranchi in WPS No. 3771 of 2019

Appearances for Parties

Vijay Hansaria, Sr. Adv., Akhilesh Kumar Pandey, Mrs. Shalini
Chandra, Abhishek Kumar Pandey, Ms. Kavya Jhawar, Ms. Nandini
Rai, Mrs. Nandita Mishra, Advs. for the Appellants.
Ajit Kumar Sinha, Sr. Adv., Ashwarya Sinha, Saurabh Jain,
Ms. Tulika Mukherjee, Beenu Sharma, Venkat Narayan, Advs. for
the Respondents.
492 [2025] 1 S.C.R.

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Judgment / Order of the Supreme Court

Order

Satish Chandra Sharma, J.

1. The present appeal is arising out of judgment dated 29.06.2022

passed by High Court of Jharkhand in Writ Petition (C) No. 3771/2019,
by which the High Court has declined to entertain the relief for
quashment of notification dated 30.05.2019 whereby the private
respondents have been appointed to the post of District Judge in
the Jharkhand Superior Judicial Service on promotion in the State
of Jharkhand.
2. The facts of the case reveal that appellant No. 1 was initially
appointed as Munsif [Civil Judge (Junior Division)] and was promoted
on 23.07.2014 in the cadre of Civil Judge (Senior Division) and
appellant Nos. 2 and 3 who were initially appointed as Civil Judge
(Junior Division) were promoted to the cadre of Civil Judge (Senior
Division) on 20.04.2016. In the combined gradation list of judicial
officers in the State of Jharkhand, the names of appellant Nos. 1, 2
and 3 find place at serial Nos. 141, 195 and 204 respectively. The
High Court of Jharkhand issued a notification dated 19.05.2018 for
appointment in the Jharkhand Superior Judicial Service and the
appellants participated in the selection process. The rules governing
the field known as Jharkhand Superior Judicial Services (Recruitment,
Appointment and Condition of Service) Rule, 2001, provides for a
process of appointment to the service and Rules 4 and 5 of the said
Rules, read as under:
“4. APPOINTMENT TO THE SERVICE: Appointment to
the Service, which shall in the first instance ordinarily be
to the post of Additional District Judge, shall be made by
the Governor, in consultation with High Court:
(a) by direct recruitment of persons as recommended by
the High Court for such appointment under clause (2) of
Article 233 of the Constitution of India;
(b) by promotion from amongst the Sub-Judges (Civil
Judge, Senior Division) on the basis of merit-cum-seniority
and passing a suitability test and;
[2025] 1 S.C.R.  493

Dharmendra Kumar Singh & Ors. v.

The Hon’ble High Court of Jharkhand & Ors.

(c) by promotion on the basis of Limited Competitive

Examination of club Judges (Civil Judge, Senior Division)
having not less than 5 years service in the same cadre.
5. Of the total post in the cadre of service:-
(i) 65% shall be filled in by promotion from amongst the
Sub Judges (Civil Judge, Senior Division) on the basis of
merit-cum-seniority and passing a suitability test as may
from time to time be prescribed by the High Court.
(ii) 10% shall be filled in by promotion (by way of selection)
strictly on the basis of merit through a limited Competitive
examination of Sub Judges (Civil Judge, Senior Division)
having not less than 5 years service and also having due
regard to his service records in the past.
Provided, if candidates are not available for 10% quota,
or are not able to qualify in the examination, then vacant
post shall be filled up by regular promotion.
(iii) 25% shall be filled in by direct recruitment from the
Bar on the basis of written test and viva-voce conducted
by the High Court.
(iv) The suitability test as provided in Clause (i) above
shall comprise of:-
(a) Interview of 20 Marks,
(b) 60 Marks shall be earmarked on the basis of Service
Profile depending on the remarks earned by the Officer
in his A.C.R. during last 10 (ten) years of service, which
may include the Service as Civil Judge (Junior Division).
The marking pattern shall be as follows for this section:-

Outstanding - 6 Marks.
Very Good - 5 Marks.
Good - 4 Marks.
Satisfactory - 3 Marks.
Average - 2 Marks.
Poor - 1 Mark.
494 [2025] 1 S.C.R.

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(c) Evaluation of Judgement - 10 Marks.

(d) Maximum of 10 Marks shall be earmarked on the basis
of 1 mark against each year of completion of Service as
Civil Judge (Senior Division) by the Officer.
The candidate obtaining minimum 40 Marks in aggregate
shall be treated suitable for appointment on promotion.
However, the intense seniority in the Cadre of Superior
Judicial Service of such suitable candidates/Officers shall
be determined in terms of Rules 8(b) of these Rules.”
3. The aforesaid rules provide for promotion by Limited Competitive
examination, promotion from Civil Judge (Senior Division) and by
Direct Recruitment. The quota for Direct Recruitment is 25%, the
quota for promotion based upon merit-cum-seniority and passing
of suitability test is 65% and the remaining is to be filled up by
Limited Competitive examination. It is undisputed fact that the cut
off marks for determining suitability of a candidate for promotion was
fixed as 40 marks and undisputedly appellants have obtained more
than 40 marks, however, the persons junior to them were promoted by
preparing a merit list and by promoting those who have more marks
than the appellants. The appellants’ writ petition was dismissed by
the High Court on the ground that the appellant No. 1 got 50 marks,
appellant No. 2 got 50 marks and appellant no. 3 got 43 marks and
the last selected candidate got 51 marks.
4. At the outset, learned counsel for the appellant has straight away
drawn the attention of this Court towards the judgment delivered
by a Three Judge Bench of this Court in the case of Ravikumar
Dhansukhlal Maheta and Another Vs. High Court of Gujarat
and Others 2024 SCC Online SC 972 to contend that in similar
circumstances in respect of similar criteria, this Court has held that
the suitability of each candidate has to be tested on his own merit
and a comparative assessment cannot be made and the promotion
cannot be solely based upon merit list. Para 141 of the judgment
delivered by this Court reads as under:
“141. We summarise our final conclusion as under:—
(A) What has been conveyed, in so many words, by this
Court in All India Judges’ Association (3) (supra) is that
[2025] 1 S.C.R.  495

Dharmendra Kumar Singh & Ors. v.

The Hon’ble High Court of Jharkhand & Ors.

the suitability of each candidate should be tested on their

own merit. The aforesaid decision does not speak about
comparative merit for the 65% promotional quota. In other
words, what is stipulated is the determination of suitability
of the candidates and assessment of their continued
efficiency with adequate knowledge of case law.
(B) For the 65% promotional quota this Court in All India
Judges’ Association (3) (supra) did not state that after taking
the suitability test, a merit list should be prepared and the
judicial officers should be promoted only if they fall in the
said merit list. It cannot be said to be a competitive exam.
Only the suitability of the judicial officer is determined and
once it is found that candidates have secured the requisite
marks in the suitability test, they cannot be thereafter
ignored for promotion.
(C) However, we clarify that for the 65% promotional
quota, it is for a particular High Court to prescribe or lay
down its own minimum standard to judge the suitability of
a judicial officer, including the requirement of comparative
assessment, if necessary, for the purpose of determining
merit to be objectively adjudged keeping in mind the
statutory rules governing the promotion or any promotion
policy in that regard.
(D) We find no fault with the promotion process adopted
by the High Court of Gujarat as the same fulfils the twin
requirements stipulated in paragraph 27 of All India Judges’
Association (3) (supra) being : -
(I) The objective assessment of legal knowledge of the
judicial officer including adequate knowledge of case law
and;
(II) Evaluation of the continued efficiency of the individual
candidates.
(E) The four components of the Suitability Test as
prescribed under the recruitment notice dated 12.04.2022
comprehensively evaluate (i) the legal knowledge
including knowledge of the case law through the objective
496 [2025] 1 S.C.R.

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MCQ - based written test AND (ii) the continued efficiency

by evaluation of the ACRs, average disposal and past
judgments of the concerned judicial officer.
(F) We are of the view that if the contention of the petitioners
were to be accepted then it would completely obliterate the
fine distinction between the two categories of promotion
in the cadre of District & Sessions Judge by way of 65%
promotion on the basis of ‘Merit-cum-Seniority’ and 10%
promotion strictly on the basis of merit. In other words,
the 65% quota for promotion will assume the character
of the 10% quota for promotion by way of a departmental
competitive examination which is distinct in its nature since
the latter is strictly based on merit.
(G) Deviating from the process of promotion duly followed
by the High Court of Gujarat since 2011 would cause
grave prejudice to those judicial officers who lost out in the
previous selections to the Higher Judicial Service despite
having scored higher marks in the suitability test since,
judicial officers who were relatively senior were promoted
to the cadre of District & Sessions Judges. Accepting
the argument of the petitioners would completely flip the
process and displace the respondents once again, for a
contrary reason.”
5. In light of the aforesaid judgment, as the appellants have successfully
qualified the suitability test, they could not have been deprived of
their legitimate right of promotion only on account of lower placement
in the merit list. At this juncture, it has been brought to the notice
of this Court that the appellants have been subsequently promoted
and the issue now remains in respect of their seniority alone. In view
of the judgment rendered by this Court in the case of Ravikumar
Dhansukhlal Maheta and Another (supra), the appellants are
certainly entitled for promotion from the same date the other officers
from the select list prepared by the High Court of Jharkhand have
been appointed to the post of District Judge in terms of notification
dated 30.05.2019.
6. Resultantly, the Civil Appeal is allowed and the orders passed by
the High Court of Jharkhand is set aside. The appellants shall be
[2025] 1 S.C.R.  497

Dharmendra Kumar Singh & Ors. v.

The Hon’ble High Court of Jharkhand & Ors.

entitled for notional promotion from the date other officers have been
promoted to the post of District Judge in terms of notification dated
30.05.2019. They shall also be entitled for all consequential service
benefits, including, seniority, increments, notional pay fixation etc.,
however, they shall not be entitled for any back wages.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Nidhi Jain
 [2025] 1 S.C.R. 498 : 2025 INSC 51

Inspector, Railway Protection Force, Kottayam

v.
Mathew K Cherian & Anr.
(Criminal Appeal No. 4169 of 2024)
09 January 2025
[Dipankar Datta* and Prashant Kumar Mishra, JJ.]

Issue for Consideration

Whether the act of creating fake/multiple user IDs by an individual,
who may or may not be an authorized railway agent, with the intention
to procure and supply online tickets through IRCTC portal would
constitute an offence under Section 143 of the Railways Act, 1989.

Headnotes†
Railways Act, 1989 – s.143 – In the first of the appeal (lead
appeal), M was accused of creating fraudulent user IDs with
the Indian Railway Catering and Tourism Corporation web
portal to procure and peddle railway tickets for profit, without
being an agent authorised to procure and supply railway
tickets and, therefore, operating an unauthorised business for
procurement and supply of railway tickets – Crime case u/s.143
of the 1989 Act was registered – M filed application u/s.482
CrPC – The High Court, vide the impugned order, quashed the
criminal proceedings – In the another connected appeal, the
offence alleged against R, an authorised agent, was that he
has been supplying e-tickets to various customers, and that
these e-tickets had been booked through multiple user IDs –
Crime case u/s.143 of the 1989 Act was registered – R filed
application u/s.482 before the High Court – The High Court
refused to quash the criminal proceedings – Correctness:
Held: S.143, on its plain language, prohibits any person, other than
a railway servant or an authorised agent, to conduct the business
of procurement and supply of railway tickets – The provision
does not specify the modalities of the procurement and supply –
Hence, if the natural and ordinary meaning is given to the section,
keeping in mind the objective and purpose of the legislation, it
admits of no doubt that this provision criminalises unauthorised
procurement and supply, irrespective of the mode of procurement
* Author
[2025] 1 S.C.R.  499

Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

and supply – The mere fact of the system of e-reservation and

e-tickets being introduced after the enactment of the Act does not
render the provision in s.143 toothless to combat the illegal sale
of e-tickets – S.143, importantly, makes no distinction between
physical and online sale of tickets – The mischief that the provision
seeks to remedy is that there should not be illegal and unauthorised
procurement and sale of tickets, whatever be the mode-physical
or online – In the lead appeal, the facts of the case prima facie
reveal the commission of an offence u/s.143 of the Act – M, without
the authorisation of the railways, was carrying on a business of
procurement and supply of railway tickets – The allegations against
M taken at face value fulfil the elements required u/s.143(1)(a) of
the Act – In the connected appeals, R was an authorised agent of
the railways carrying on the business of procurement and supply of
railway tickets – S.143 only deals with the actions of unauthorised
persons and does not mandate a procedure to be followed by
the authorised agents for procuring or supplying tickets to its
customers – The nature of allegations against R in the connected
appeal, though serious, s.143 would not be attracted insofar as he
is concerned – To sum up, M not being an authorised agent has
to face the proceedings against him while R, being an authorised
agent, cannot be proceeded against u/s.143 of the Act for alleged
breach of any of the terms and conditions of the contract – Thus,
criminal proceedings against M are restored and the proceedings
against R are hereby quashed. [Paras 27, 28, 34, 35, 37, 38, 40]

Interpretation of Statutes – Statutory provision – Subsequent

developments:
Held: Statutory interpretation has to follow certain principles which
have been formulated through legal precedents – No court can
refuse to enforce a provision on the sole basis of the provision
predating any subsequent development regarding the ticketing
process – If it can be demonstrated that a statutory provision is
broad enough to envelop the subsequent developments, even
if the developments were not envisioned by the legislature, the
provision would stay operational. [Para 21]

Interpretation of Statutes – Language of statute – Addition or

deletion of words:
Held: It is settled that if the language of the particular statute under
consideration is clear and unambiguous, it is not for the courts
500 [2025] 1 S.C.R.

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to add to or delete any words from the statute in the guise of

ascertaining what could have been the legislative intent. [Para 26]

Case Law Cited

Senior Electric Inspector v. Laxminarayan Chopra [1962] SCR 3
146 : AIR 1962 SC 159; Dharani Sugars and Chemicals Ltd. v.
Union of India [2019] 6 SCR 307 : (2019) 5 SCC 480; Jugalkishore
Saraf v. Raw Cotton Co. Ltd. [1955] 1 SCR 1369 : AIR 1955 SC
376; Ansal Properties & Industries Ltd. v. State of Haryana [2009]
1 SCR 553 : (2009) 3 SCC 553 – relied on.
R.P. Kapur v. State of Punjab [1960] 3 SCR 311 : 1960 SCC
OnLine SC 21; State of W.B. v. Swapan Kumar Guha [1982] 3 SCR
121 : (1982) 1 SCC 561; State of Haryana v. Bhajan Lal [1992]
Supp. 3 SCR 735 : (1992) Supp. 1 SCC 335; Pepsi Foods Ltd.
v. Special Judicial Magistrate [1997] Supp. 5 SCR 12 : (1998) 5
SCC 749; Amit Kapoor v. Ramesh Chander [2012] 7 SCR 988 :
(2012) 9 SCC 460 – referred to.
Comdel Commodities Ltd. v. Siporex Trade S.A. (No. 2) (1990) 2
All ER 552 (HL) – referred to.

List of Acts
Railways Act, 1989; Code of Criminal Procedure, 1973.

List of Keywords
Unauthorized Business; Procure; Supply; Railway e-tickets;
Fraudulent Activity; Fake and Multiple User-Ids; Interpretation of
Statutes; Authorized Agents; Statutory Interpretation; Disciplinary
Control; Modalities of Procurement and Supply; Sale of Valueless
Tickets.

Case Arising From

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
4169 of 2024
From the Judgment and Order dated 22.09.2016 of the High Court
of Kerala at Ernakulam in CRLMC No. 1991 of 2016
With
Criminal Appeal Nos. 139-140 of 2025
[2025] 1 S.C.R.  501

Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

Appearances for Parties

Mrs. Aishwarya Bhati, A.S.G., P. N. Prakash, Sr. Adv., Namit
Saxena, Amrish Kumar, Mrs. Shivika Mehra, Mrs. Sonia Mathur,
Merusagar Samantray, Sushil Kumar Dubey, Ms. Priyanka Terdal,
Ms. Riddhi Jad, Advs. for the Appellant.
Amrish Kumar, A. Raghunath, Alim Anvar, Nishe Rajen Shonker,
Mrs. Anu K. Joy, Ajith Anto Perumbully, Advs. for the Respondents.

Judgment / Order of the Supreme Court

Judgment

Dipankar Datta, J.

Introduction
1. Common question of law touching interpretation of Section 143 of the
Railways Act, 19891 is involved in these appeals by special leave;
hence, we propose to decide the same by this common judgment.
2. In the first of the two sets of appeals,2 the judgment and order3 of
the High Court of Kerala at Ernakulum4 is assailed whereby criminal
proceedings under Section 143 of the Act launched against the first
respondent – Mathew K. Cheriian5 – was quashed.
3. In the connected appeals, the appellant - J. Ramesh6 – has assailed
the judgment and order7 of the High Court of Judicature at Madras8
refusing to quash the criminal proceedings launched against Ramesh
under Section 143 of the Act.

Factual Matrix
4. The factual scenario of the two sets of appeals are not too complicated.
The facts which are germane are noted as a precursor to our discussion.

1 the Act
2 the lead appeal
3 in Criminal Miscellaneous Case No. 1991/2016 dt. 22.09.2016
4 Kerala High Court
5 Mathew
6 Ramesh
7 In CRL. O.P. No.18701/2020 18703/2020 and Crl. MP. Nos.7328/2020 and 7329/2020
8 Madras High Court
502 [2025] 1 S.C.R.

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5. The prosecution case in the lead appeal is that on 11.03.2016,

on reliable information being disclosed to the Inspector, Railway
Protection Force,9 that unauthorised business of procuring and
supplying railway e-tickets was being carried out in the office
of Mathew, Crime Case No. 524/2016 under Section 143 of the
Act was registered and a search conducted thereat. During the
search and seizure operation, one employee named Joby Jose of
Kosamattam Finance, a non-banking finance company (of which
Mathew happened to be the managing director) was arrested and
17 pieces of evidence were seized. In his confessional statement,
Joby Jose stated he was working under the supervision of Mathew.
On the basis of this statement, Mathew was made co-accused in
Crime Case No. 524/2016. He was accused of creating fraudulent
user IDs with the Indian Railway Catering and Tourism Corporation10
web portal to procure and peddle railway tickets for profit, without
being an agent authorised to procure and supply railway tickets
and, therefore, operating an unauthorised business for procurement
and supply of railway tickets. Aggrieved, Mathew moved the Kerala
High Court under Section 482, Code of Criminal Procedure, 197311
seeking quashing of the proceedings. The Kerala High Court, vide
the impugned order, quashed the criminal proceedings emanating
from Crime Case No. 524/2016. Dissatisfied thereby, the Inspector,
RPF is in appeal.
6. The connected appeals arise out of Case Crime No. 3116/2019
and Case Crime No. 600/2020. The case of the prosecution is that
Ramesh and his son are the owners of “Big Top Travels” which
is an authorised agent for railway e-tickets. On 05.12.2019, Case
Crime No. 3116/2019 came to be registered against Ramesh under
Section 143 of the Act on the basis of a search and seizure operation
conducted by a special team of the RPF in the shop premises of
Ramesh. The offence alleged against him is that he has been
supplying e-tickets to various customers, and that these e-tickets had
been booked through multiple user IDs. Case Crime No. 600/2020
was registered against Ramesh, also under Section 143(1)(a) of
the Act for his involvement in fraudulent activities such as supply of

9 RPF
10 IRCTC
11 Cr.PC
[2025] 1 S.C.R.  503

Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

Tatkal e-tickets by creating multiple personal-user IDs and issuing

unauthorised e-tickets procured through IRCTC website, contrary
to IRCTC Rules. Ramesh, feeling aggrieved by initiation of criminal
action by the respondent-authorities, approached the Madras High
Court under Section 482, Cr. PC with a prayer to quash the criminal
proceedings. The Madras High Court, however, refused to quash
the criminal proceedings. Dissatisfied with the impugned order of
the Madras High Court, Ramesh has questioned the same in the
connected appeals.

Submissions
7. For the sake of brevity, the submissions advanced by the parties
in both sets of the appeals are noted together. Arguments of the
prosecution can be summarised as follows:
I. Section 143 of the Act does not permit authorised agents to carry
out unauthorised actions under the façade of authorisation. When
an authorised agent carries out unauthorised transactions using
the personal IDs of other individuals, the cloak of authorisation
cannot be used as a ruse. Therefore, to be exempt from the
application of Section 143, both the status of the person and
the nature of the action must be considered.
II. Section 143 is part of the overall scheme to promote the efficacy
of the railway system and its operations. Therefore, the Court
must interpret the provision in line with the object of the statute.
III. Mathew, as the Managing Director of a finance company, created
hundreds of user IDs to sell railway tickets at a premium which
constitutes an offence under Section 143.
IV. Section 143 makes no distinction between physical tickets
and e-tickets and only contemplates penal action against
unauthorised carrying on of the business of procuring and
supplying railway tickets.
V. Offence under Section 143 is a social crime. The mischief is
sought to be addressed by limiting the number of tickets that
an individual can purchase using his personal ID and, thereby,
touting of railway tickets is prevented.
VI. The Kerala High Court has erred in quashing the criminal
proceedings at this stage as a bare perusal of the complaint
504 [2025] 1 S.C.R.

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reveals that all the ingredients under Section 143 are prima
facie attracted.
VII. The Madras High Court has correctly refrained from following
the erroneous decision of the Kerala High Court.
VIII. While upholding the decision of the Madras High Court, the
decision of the Kerala High Court ought to be reversed and the
prosecution allowed to lead its evidence before the relevant trial
courts for the proceedings to be taken to its logical conclusion.
8. The submissions on behalf of the accused – Mathew and Ramesh –
in favour of quashing of the proceedings, as advanced before us,
are these:
I. The plain and unambiguous words of Section 143 of the Act
make it clear that the creation of multiple user IDs is not an
offence under Section 143, and Section 143 must be construed
strictly as it is a penal provision.
II. The materialisation of e-ticketing scheme could not have been
conceptualised by the legislature at the time of passing the Act,
as the scheme as well as the internet did not exist at that time.
III. Section 143(1)(a) was intended to penalise the sale of tickets
by persons other than railway servants and authorized agents.
IV. Ramesh is an authorised agent and, thus, could not have been
proceeded against under Section 143(1), on its own terms;
and, if at all, there has been a breach or violation of the terms
and conditions of the contract by Ramesh, the remedy of the
railways/RPF is to approach the civil court.
V. The decision of the Madras High Court ought to be reversed and
the decision of the Kerala High Court upheld, thereby bringing
down the curtain on both the criminal proceedings.

Impugned Orders
9. Now, let us have a look at the orders impugned before us. A thorough
examination thereof would enable us to arrive at an appropriate
conclusion.
10. In the lead appeal, the Kerala High Court has quashed the criminal
proceedings against the first respondent. The reasons assigned
therefor are reproduced below:
[2025] 1 S.C.R.  505

Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

“5. The Act was enacted much before the advent of

e-ticket system. The object of Section 143 is to prevent
procurement of ticket for travelling on railway or in a
reserved compartment or journey in a train by any person
with the ticket not being issued by railway servant or by an
authorised agent. It appears that Railway wants to ensure
the authenticity of the tickets issued to the travellers on
a travel in a railway. It appears that many travellers were
travelling on railway in a ticket not being issued to them
and issued in the name of third parties. The Railways Act
wants to ensure that the ticket is issued by railway servant
or agent authorised on this behalf as the case may be to
a genuine travellers (sic, “traveller”).
6. …The use of internet medium registered in the name
of a person, to issue tickets to a third party is not one
contemplated under Section 143 for the purpose of
considering it as an offence. … There is no sale of ticket
by the petitioner as even admitted in the counter, the sale
is being conducted by IRCTC. The use of computer or
use of printer for printing ticket purchased by a traveller
cannot be deemed as sale effected by the owner of the
computer or printer. Procuring tickets has to be understood
as providing or giving tickets to the travellers. Admittedly
tickets are procured by the genuine travellers. When
legislature considered an actionable wrong in a particular
manner in a brick and mortar business, it cannot be applied
to an online business unless all elements constituting the
offence-are present in the online business. The offence is
not attracted even if one has to assume that action of the
accused would amount to revision clearly mandates that
tickets have to be procured by the offender.”
11. The view taken by the Kerala High Court appears to be that
Section 143 is somewhat outdated in the age of purchasing tickets
using the internet. It has, in essence, read down Section 143 to
state that one can conduct a business of procuring and supplying
tickets without the authorisation of the railways as long as it is done
through the internet. The order also observes that as the tickets were
procured in the name of genuine passengers, it cannot be said that
Mathew had contravened Section 143.
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12. In the connected appeals, the Madras High Court refused to quash
the criminal appeal and ratiocinated its view in the following words:
“9. …This Court is of the considered view that the decision
held by the High Court of Kerala holding that the said
provision was enacted much prior to the creation of e-tickets
and the petitioner therein was not carrying a business of
procuring and supplying of tickets for travel on the Railway
reserved tickets through internet and therefore online was
not prohibited, whereas in the case on hand, the offence
committed by the petitioner is completely different from
the aforesaid case. The petitioner himself created more
than 200 user IDs, procured tickets and supplied to the
passengers. Further, in the said business of procuring
and purchasing tickets on Railways were for the benefit
of Rs.150/- for sleeper and Rs.250/- for A/C per head in
addition to ticket fare as service charge from his customers,
prohibited by the provisions under Section 143 of the Act.
In fact, recommendation of the e-tickets scheme no way
alters the position of purchase of tickets, as agent or the
customer can book e-tickets by creating ID in their name.
But the authorized agent cannot create other user IDs for
the purpose of procuring tickets for illegal gain. Therefore,
judgement cited by the learned counsel for the petitioner
is not applicable to the case on hand. That apart, the
crime is under investigation and only after investigation,
the respondent can unearth the truth.”
13. The Madras High Court acknowledged that Ramesh was an
authorised agent under Section 143; however, it refused to quash the
criminal proceedings on the ground that such authorisation did not
empower the appellant to create multiple user IDs for the purpose
of procuring tickets for illegal gain. On the ground that Ramesh was
only authorised to sell tickets through his own account and was not
specifically authorised to create multiple user IDs, the Madras High
Court dismissed Ramesh’s petition seeking quashing of the criminal
proceedings.

Analysis
14. The appeals before us, although have different factual matrices,
involve a common question of law. Having bestowed serious
[2025] 1 S.C.R.  507

Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

consideration and thought, we find ourselves in a curious position

where our interference seems to be warranted in both sets of
appeals.
15. In order to settle the controversy in the present lis, the ambit and scope
of Section 143 of the Act has to be noticed and comprehended. The
question before us is whether the act of creating fake/multiple user
IDs by an individual, who may or may not be an authorized railway
agent, with the intention to procure and supply online tickets through
IRCTC portal would constitute an offence under Section 143 of the
Act? In addition to the scope of Section 143, we need to analyse
whether the two criminal proceedings in question did merit quashing
by the respective High Court.
16. At this stage, it would be beneficial to read Section 143 of the Act.
It reads:
143. Penalty for unauthorised carrying on of business of
procuring and supplying of railway ticket-
(1) if any person, not being a railway servant or an
agent authorised in this behalf,-
(a) carries on the business of procuring and supplying
tickets for travel on a railway or from reserved
accommodation for journey in a train; or
(b) purchases or sells or attempts to purchase or sell
tickets with a view to carrying on any such business
either by himself or by any other person,
he shall be punishable with imprisonment for a term
which may extend to three years or with fine which
may extend to ten thousand rupees, or with both,
and shall also forfeit the tickets which he do so
procures, supplies, purchases, sells or attempts to
purchase or sell:
Provided that in the absence of special and adequate
reasons to the contrary to be mentioned in judgment
of the court, such punishment shall not be less than
imprisonment for a term-of one month or a fine of
five thousand rupees.
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(2) Whoever abets any offence punishable under

this section shall, whether or not such offence is
committed, be punishable with the same punishment
as is provided for the offence.
(emphasis supplied)
17. The purport and objective of Section 143 of the Act is to restrict entities
which are not under the disciplinary control of or are not authorised
by the railways to conduct the business of procurement and supply of
railway tickets. Railway servants and authorised agents stand apart
since, on its own terms, Section 143 has no application to them.
18. The whole scheme of e-ticketing was introduced for the convenience
and betterment of the passenger’s experience of travelling on a train,
due to which the procurement and supply of these e-tickets, rightfully
so, is highly regulated. In the additional affidavit of the appellant in
the lead appeal, Rules and Regulations for Reserved Bail e-Ticketing
Service Providers (PSPs/RSPs) have been annexed which reflect the
idea of protecting the consumer and strictly prohibit using personal/
fraudulent IDs to book tickets for commercial purposes. These rules,
further, bar sharing of the credentials by these authorised agents.
Also, the perils of hoarding of resources by a select few are widely
known and has to be kept in mind while adjudicating the present lis.
19. IRCTC has limited the number of tickets which can be reserved on
one personal user ID at 12 per month (24 per month with a user ID
which is Aadhaar verified). Mathew, it is alleged, had created hundreds
of fake user IDs to sell tickets without any authorisation from the
railways. Although the internet and e-tickets were unknown in India
when the Act was brought into force, this conduct of Mathew (who
is neither a railway servant nor an authorised agent) nevertheless
attracts criminality under Section 143(1)(a) of the Act.
20. The Kerala High Court allowed the quashing petition filed by Mathew
on the ground that the Act was enacted before the advent of internet
and e-tickets and the lawmakers could not have envisioned sale of
tickets, online. We find this line of reasoning of the High Court to
be plainly erroneous.
21. Statutory interpretation has to follow certain principles which have
been formulated through legal precedents. No court can refuse to
enforce a provision on the sole basis of the provision predating any
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Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

subsequent development regarding the ticketing process. If it can be

demonstrated that a statutory provision is broad enough to envelop
the subsequent developments, even if the developments were not
envisioned by the legislature, the provision would stay operational.
This principle was expounded by this Court in Senior Electric
Inspector v. Laxminarayan Chopra12 in the following words:
“…This Court in construing the words ‘sale of goods’ in
Entry 48, List II of the Seventh Schedule to the Government
of India Act, 1935, accepted the aforesaid principle in
State of Madras v. Gannon Dunkerley & Co., (Madras)
Ltd. [(1959) SCR 379] and restated it at p. 416 thus:
‘The principle of these decisions is that when, after the
enactment of a legislation, new facts and situations
arise which could not have been in its contemplation,
the statutory provisions could properly be applied
to them if the words thereof are in a broad sense
capable of containing them.’
The legal position may be summarized thus: The
maxim contemporanea expositio as laid down by Coke
was applied to construing ancient statutes, but not
to interpreting Acts which are comparatively modern.
There is a good reason for this change in the mode of
interpretation. The fundamental rule of construction is the
same whether the Court is asked to construe a provision of
an ancient statute or that of a modern one, namely, what
is the expressed intention of the Legislature. It is perhaps
difficult to attribute to a legislative body functioning in a
static society that its intention was couched in terms of
considerable breadth so as to take within its sweep the
future developments comprehended by the phraseology
used. It is more reasonable to confine its intention only
to the circumstances obtaining at the time the law was
made. But in a modern progressive society it would be
unreasonable to confine the intention of a Legislature to
the meaning attributable to the word used at the time the
law was made, for a modern Legislature making laws to

12 [1962] 3 SCR 146 : AIR 1962 SC 159

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govern a society which is fast moving must be presumed to

be aware of an enlarged meaning the same concept might
attract with the march of time and with the revolutionary
changes brought about in social, economic, political and
scientific and other fields of human activity. Indeed, unless
a contrary intention appears, an interpretation should be
given to the words used to take in new facts and situations,
if the words are capable of comprehending them. We
cannot, therefore, agree with the learned Judges of the High
Court that the maxim contemporanea expositio could be
invoked in construing the word ‘telegraph line’ in the Act.”
(emphasis supplied)
22. The aforenoted decision has been followed in a relatively recent
decision of this Court in Dharani Sugars and Chemicals Ltd. v.
Union of India.13 This Court, further, noticed an English decision in
Comdel Commodities Ltd. v. Siporex Trade S.A. (No. 2)14 distilling
the principle as follows:
‘… When a change in social conditions produces a novel
situation, which was not in contemplation at the time
when a statute was first enacted, there can be no a priori
assumption that the enactment does not apply to the
new circumstances. If the language of the enactment
is wide enough to extend to those circumstances,
there is no reason why it should not apply.’
23. Bearing in mind the above principles, we may now proceed to consider
a couple of decisions of this Court on the rule of literal interpretation.
24. In Jugalkishore Saraf v. Raw Cotton Co. Ltd.,15 Hon’ble S.R. Das J.
(as His Lordship then was), speaking for the Court, held as follows:
“6…The cardinal rule of construction of statutes is to read
the statutes literally, that is, by giving to the words their
ordinary, natural and grammatical meaning. If, however,
such a reading leads to absurdity and the words are
susceptible of another meaning, the Court may adopt

13 [2019] 6 SCR 307 : (2019) 5 SCC 480

14 (1990) 2 All E R 552 (HL)
15 [1955] 1 SCR 1369 : AIR 1955 SC 376
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Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

the same. But if no such alternative construction is

possible, the Court must adopt the ordinary rule of literal
interpretation. In the present case, the literal construction
leads to no apparent absurdity and therefore, there can
be no compelling reason for departing from that golden
rule of construction.”
25. A reference can also be made to the decision of not too distant an
origin. In Ansal Properties & Industries Ltd. v. State of Haryana,16
the rule of literal construction has been reiterated in the following
words:
“39. If the legislature had intended that the licensee is
required to transfer the land and also to construct the
buildings on it or to make payment for such construction,
the legislature would have made specific provisions laying
down such conditions explicitly and in clear words in
which event the provisions would have been worded in
altogether different words and terms. It is a well-settled
principle in law that the court cannot read anything into a
statutory provision which is plain and unambiguous. The
language employed in a statute is determinative factor of
legislative intent. If the language of the enactment is clear
and unambiguous, it would not be proper for the courts to
add any words thereto and evolve some legislative intent,
not found in the statute.”
(emphasis supplied)
26. From the above decisions, it is quite clear that if the language of the
particular statute under consideration is clear and unambiguous, it is
not for the courts to add to or delete any words from the statute in
the guise of ascertaining what could have been the legislative intent.
27. Section 143, on its plain language, prohibits any person, other than
a railway servant or an authorised agent, to conduct the business
of procurement and supply of railway tickets. The provision does
not specify the modalities of the procurement and supply. Hence, if
we read the section and give its contents the natural and ordinary
meaning, keeping in mind the objective and purpose of the legislation,

16 [2009] 1 SCR 553 : (2009) 3 SCC 553

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as discussed above, it admits of no doubt that this provision

criminalises unauthorised procurement and supply, irrespective of
the mode of procurement and supply.
28. We are further of the considered opinion that the mere fact of
the system of e-reservation and e-tickets being introduced after
the enactment of the Act does not render the provision in Section
143 toothless to combat the illegal sale of e-tickets. Section 143,
importantly, makes no distinction between physical and online sale
of tickets. The mischief that the provision seeks to remedy is that
there should not be illegal and unauthorised procurement and sale
of tickets, whatever be the mode – physical or online. The Kerala
High Court seems to have missed this aspect.
29. There has been a major technological development in the last three
decades by reason whereof a significant number of services provided
by the Governments are available online. Electronic and internet
services have not only become indispensable but offer significant
advantages to the public. Having regard to the comprehensive
phraseology employed in Section 143, the net of its coverage is
wide enough to encompass regulation of the conduct of ticketing
agents and to protect the public from unscrupulous elements trying
to defraud them by sale of valueless tickets.
30. The Kerala High Court made the distinction between “procure” and
“purchase”. It held that the tickets were “purchased” by genuine
passengers. The tickets were not sold by Mathew, rather, the tickets
were sold by IRCTC in the names of the passengers. Hence, it cannot
be said that Mathew was procuring the tickets. This reasoning, in
our view, is flawed and unsustainable. Travel agents, by and large,
do not purchase tickets in their own name and then sell it to the
passengers. Tickets are procured in the name of the passengers
by these agents in lieu of a commission on the price thereof. Taking
active steps, however faithfully, in order to acquire and provide
tickets to third parties but without being a railway servant or an
authorised agent would attract the expression ‘procure and supply’
as in Section 143.
31. We agree with the prosecution that Section 143, a penal provision,
has been enacted to tackle a social crime. The Indian Railways is a
keystone of our country’s infrastructure. It carries around 673 crore
passengers annually and has a tremendous impact on the economy
[2025] 1 S.C.R.  513

Inspector, Railway Protection Force, Kottayam v.

Mathew K Cherian & Anr.

of this country. Any effort to disrupt the integrity and stability of the
ticketing system has to be stopped on its tracks.
32. The second issue before us is whether these criminal proceedings
in the two appeals should be quashed. This Court has dealt with the
issue of quashing numerous times. Reference in this connection may
be made to the decisions in R.P. Kapur v. State of Punjab,17 State
of W.B. v. Swapan Kumar Guha,18 State of Haryana v. Bhajan
Lal,19 Pepsi Foods Ltd. v. Special Judicial Magistrate,20 and Amit
Kapoor v. Ramesh Chander.21
33. The principles which can be extrapolated from these precedents are
that quashing of a criminal proceeding can take place, inter alia, if the
first information report does not reveal a crime or if the fact situation
be such that continuance of the criminal proceedings would result in
abuse of the process causing injustice to the accused. This power
of quashing, however, is not unfettered or unlimited and as the old
adage goes - “judicial discretion has to be exercised judiciously”.
34. In the lead appeal, the facts of the case prima facie reveal the
commission of an offence under Section 143 of the Act. Mathew,
without the authorisation of the railways, was carrying on a business
of procurement and supply of railway tickets. The allegations against
Mathew taken at face value fulfil the elements required under
Section 143(1)(a) of the Act; hence, the threshold for quashing has
not been met in this case.
35. In the connected appeals, Ramesh was an authorised agent of the
railways carrying on the business of procurement and supply of
railway tickets. Section 143 only deals with the actions of unauthorised
persons and does not mandate a procedure to be followed by the
authorised agents for procuring or supplying tickets to its customers.
The nature of allegations against Ramesh in the connected appeal,
though serious, Section 143 would not be attracted insofar as he
is concerned.

17 [1960] 3 SCR 311 : 1960 SCC OnLine SC 21

18 [1982] 3 SCR 121 : (1982) 1 SCC 561
19 [1992] Supp. 3 SCR 735 : (1992) Supp. 1 SCC 335
20 [1997] Supp. 5 SCR 12 : (1998) 5 SCC 749
21 [2012] 7 SCR 988 : (2012) 9 SCC 460
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36. That apart, Section 143 does not criminalise creating multiple user IDs.
Penal provisions have to be read strictly and narrowly as a general
rule. Section 143, by being completely silent on creation of multiple
user IDs, penalises the actions of only the unauthorised agents and
not unauthorised actions of the authorised agents. Thus, even if the
facts disclosed in the first information report are taken at face value,
commission of an offence cannot be attributed to Ramesh. Any
breach has to be remedied by civil action and not criminal action.
37. To sum up, Mathew not being an authorised agent has to face the
proceedings against him while Ramesh, being an authorised agent,
cannot be proceeded against under Section 143 of the Act for alleged
breach of any of the terms and conditions of the contract. If, at all,
he would be liable to face civil action.
38. In our view, for the foregoing reasons, the lead appeal deserves
to be allowed and consequently, the criminal proceedings against
Mathew need to be restored. It is ordered accordingly.
39. The proceedings against Mathew shall be taken to its logical
conclusion, in accordance with law. Observations made by us
hereinabove are for the purpose of a decision on the lead appeal
and may not be construed as an expression of opinion on the merits
of the prosecution’s case.
40. The connected appeals are allowed as well, but the criminal
proceedings against Ramesh are hereby quashed.

Result of the case: Appeals allowed.

†
Headnotes prepared by: Ankit Gyan
 [2025] 1 S.C.R. 515 : 2025 INSC 33

Geetha V.M. & Ors.

v.
Rethnasenan K. & Ors.
(Civil Appeal No(s). 3994-3997 of 2024)
03 January 2025
[J.K. Maheshwari* and Rajesh Bindal, JJ.]

Issue for Consideration

Whether the option exercised by Directorate of Health Services
(DHS) employees to join Directorate of Medical Education (DME)
pursuant to a policy decision of the State of Kerala ought to be
considered as an option for absorption or a request for transfer
under proviso to Rule 27(a) of Kerala State and Subordinate
Service Rules, 1958 and in that situation, the inter-se seniority of
such employees in the DME shall be reckoned from which date.

Headnotes†
Kerala State and Subordinate Service Rules, 1958 – Proviso
to r.27(a) – Kerala Service Rules, 1959 – r.36 – Transfer of
the appellants-absorbed employees by way of absorption as
per the policy decision of the Government of Kerala, if would
attract the proviso to r.27(a):
Held: No – The proviso of r.27(a) is merely an exception to the
said Rule of maintaining the seniority from the date of appointment
in the cases of ‘on request’ and mutual transfer – The exception
is not attracted in a case of transfer by way of absorption made
in public interest or in administrative exigencies – Transfer of an
employee is an incidence of service if it is in public interest –
Government is the best judge to decide how to distribute and
utilise the services of an employee – However, if employee
makes a request due to some hardship and if the authority or
the Government on being satisfied, posts such employee as per
request, such transfer is not a transfer in public interest as it is
on the request of the employee and not in the exigencies of the
public administration – In the present case, the transfer was made
by way of absorption on the basis of option and not on the basis
of request which was in furtherance to a policy decision of the
Govt. to abolish the dual control system enhancing the efficiency
* Author
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of the administration of medical colleges and attached hospitals

thereto giving it to DME withdrawing from DHS – Therefore, the
transfer by way of absorption on exercise of option as specified
in Appendix I and II contained in G.O. dtd. 25.10.2008 does not
attract the proviso to r.27(a) which only deals with the transfer on
request or on mutual request – Thus, the action taken in public
interest due to administrative exigency even on option is different
than the action done on request – Appellants exercised the option
for absorption by transfer from DHS to DME in line with the policy
decision and thus, it cannot be considered as a case of transfer
based on their own request, volition or voluntary choice – Proviso
to r.27(a) is not attracted in case of a transfer by way of absorption
done by the Department in furtherance to the policy decision of the
Govt. – Transfer by way of absorption in public interest cannot be
equated with the transfer on request in contingencies as specified
in proviso to r.27(a) or applied mutually – Further, seniority of the
absorbed employee cannot be disturbed applying the proviso
of r.27(a) – Their seniority and inter-se seniority be maintained
as per r.27(a) and 27(c) of Part II of 1958 Rules r/w clarificatory
letter dated 24.04.2010 with reference to r.8 of Appendix I to G.O.
dated 25.10.2008 – Impugned judgment set aside. [Paras 37, 39,
47, 51-53]
Words and Phrases – ‘Transfer’; ‘option’; ‘absorb’; ‘absorption’ –
Discussed.

Case Law Cited

K.P. Sudhakaran and Another v. State of Kerala and Others (2006)
5 SCC 386 – held inapplicable.
Kartar Singh v. State of Punjab, 1989 SCC OnLine P&H 482 –
approved.

Books and Periodicals Cited

P. Ramanatha Aiyar’s Advanced Law Lexicon, 7th Edition; Corpus
Juris Secundum; Merriam-Webster Dictionary; Black’s Law
Dictionary.

List of Acts
Kerala State and Subordinate Service Rules, 1958; Kerala Service
Rules (KSR), 1959.
[2025] 1 S.C.R.  517

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

List of Keywords
Transfer; Transfer by way of absorption; Exercise of option;
Absorbed employees; Request for transfer; Transfer on request;
Mutual request; Seniority; Inter-se seniority; Directorate of Health
Services (DHS); Administrative control of DHS; Directorate of
Medical Education (DME); State of Kerala; Primary Health Centres
(PHCs); Community Health Centres (CHCs); Taluk Hospitals;
District Hospitals; Specialty Hospitals; Policy decision; Public
interest; Transfer in public interest; Dual control system; Hospitals;
Administration of medical colleges; Administrative exigency; public
administration; Clarificatory letter; transfer applied mutually; ‘Option’;
‘Absorb’; ‘Absorption’.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 3994-3997
of 2024
From the Judgment and Order dated 13.03.2019 of the High Court of
Kerala at Ernakulam in WA Nos. 1418, 1525, 1527 and 1652 of 2010

Appearances for Parties

V. Giri, Jayanth Muth Raj, Sr. Advs., Krishna Dev Jagarlamudi,
Alim Anvar, Harshed Sundar, Mohammed Sadique T.A., Advs. for
the Appellants.
Jaideep Gupta, Raghenth Basant, Sr. Advs., C. K. Sasi,
Ms. Meena K Poulose, Riddhi Bose, Ms. Racheeta Chawla,
Ms. Rishi Agarwal, Ms. Sampriti Bakshi, Siddharth Banerjee,
Dileep Poolakkot, Ms. Hima Bhardwaj, K. Rajeev, Arvind Gupta,
Advs. for the Respondents.

Judgment / Order of the Supreme Court

Judgment

J.K. Maheshwari, J.

1. The present appeals have been filed impugning the order passed
by High Court of Kerala at Ernakulam on 13.03.2019 in W.A.
Nos. 1418, 1525, 1527 and 1652 of 2010, reversing the judgments
dated 29.06.2010 and 30.06.2010 passed by learned Single Judge
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in W.P. (C) Nos. 4599, 12381 and 14091 of 2010 and W.P. (C) No.
20269 of 2010 respectively.
2. Appellants herein are the employees who were working in the
Directorate of Health Services (the “DHS”), later absorbed on
furnishing option as demanded, in the Directorate of Medical
Education (the “DME”) on account of abolition of dual control system
of the staff in medical colleges under the policy decision of the State
of Kerala. The rival claims of inter-se seniority between the original
employees of DME (hereinafter referred as ‘original employees’)
and absorbed employees from DHS in the respective categories of
DME (hereinafter referred to as ‘absorbed employees’) made by
both were decided by the order impugned.
3. Writ Petition No. 4599/2010 was filed by the absorbed employees
contending that they are entitled to retain their existing seniority
even on absorption in the DME in terms of Rule 8 of Appendix I of
the G.O. (P) No. 548/2008/H&FWD dated 25.10.2008. Since the
inter-se seniority of the absorbed employees was yet to be finalized,
during the pendency of the said Writ Petition, promotions made to
the post of Junior Superintendent and Upper Division Clerks in the
DME were cancelled.
4. In the meantime, the Government of Kerala issued clarificatory letter
No. 8195/K1/10/H&FWD dated 24.04.2010 (the “clarificatory letter”)
indicating that seniority of the absorbed employees shall be reckoned
from the date of order of promotion for the promotees and from
the date of first effective advice in case of direct recruits. The said
clarificatory letter was assailed by filing Writ Petitions Nos. 12381 and
14091 of 2010 by the original employees. The case set out was that
once the absorbed employees were transferred after exercising their
‘option’, in terms of G.O. (P) No. 548/2008/H&FWD dated 25.10.2008,
to join DME, they must rank junior and be placed at the bottom of
the seniority list and their seniority be reckoned from the date of
joining in the DME as per Rule 27(a) and Rule 27(c) of ‘Kerala State
and Subordinate Service Rules, 1958 (in short “KS&SS Rules”).
5. Learned Single Judge decided the writ petitions of the original and
absorbed employees by passing the common judgment and relying
upon Rule 8 of Appendix I of G.O. dated 25.10.2008 opined that
seniority of staff who opted to join DME will be maintained as per
Rule 27(a) and 27(c) of Part II, KS&SS Rules and the clarificatory letter
[2025] 1 S.C.R.  519

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

dated 24.04.2010. The Writ petition filed by the absorbed employees

was allowed and the Writ Petitions of the original employees were
dismissed holding that absorbed employees would be entitled to
retain their past service rendered in DHS and their seniority in DME
shall be reckoned from the date of initial appointment in DHS.
6. On filing Writ Appeal by the original employees of DHS, the Division
Bench by the order impugned set-aside the judgment of learned
Single Judge and observed that once absorbed employees had joined
DME on their own request opting for inter-departmental transfer,
proviso to Rule 27(a) of Part II of KS&SS Rules, would attract and
the seniority of the absorbed employees will be determined with
reference to their date of joining in the DME. The said order is under
challenge in these appeals.

Factual Background
7. Prior in time, DME was formed w.e.f. 10.05.1983, to manage and
coordinate Medical Colleges and Collegiate Hospitals in the State of
Kerala. Hospitals attached to medical colleges were under the control
of the DME, while Primary Health Centres (PHCs), Community Health
Centres (CHCs), Taluk Hospitals, District Hospitals and Specialty
Hospitals were under the control of DHS. Before formation of the
DME, medical colleges were operated independently but under the
administrative control of DHS and the ‘Principal’ was the head of
the department. After formation of DME, the authority of Principal
was transferred to DME, however, the ‘nursing, paramedical, and
ministerial staff’ associated with hospitals and affiliated institutions
continued to remain under the administrative control of DHS which
also included the power of appointment. This resulted in ‘dual control’,
where even though administrative authority of the medical colleges
and collegiate hospitals was shifted to DME, but the staff continued
to remain under the control of DHS, due to which significant delay
and administrative difficulties were being faced in ensuring timely
assignment/posting of Staff Nurses, Nursing Assistants, Technicians,
Attendants, Cleaning Staff, and other categories of Paramedical Staff
at Medical College Hospitals and affiliated institutions. Additionally,
Superintendents of Medical Colleges and Heads of Clinical
Departments were encountering tremendous hardship to maintain
discipline amongst staff inter-se departments. Resultantly, it posed
as an extreme impediment for the Government of Kerala to ensure
smooth functioning of both the Departments.
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8. Elaborating on further challenges, particularly regarding appointments,

majority of the hospital staff was appointed either by the DHS or the
District Medical Officer. Although Hospital Superintendents had the
power to initiate disciplinary action, yet the power for appointments,
transfers, promotions, and discipline for these employees continued
to remain with the DHS or District Medical Officer. Identifying the
issues, the Government of Kerala formed several committees that
recommended elimination of dual control system in Medical Colleges
as a corrective measure, aimed for benefiting the public at large. To
cite few examples, as per Indian Medical Council regulations, “All the
teaching hospitals shall be under the academic, administrative and
disciplinary control of Dean / Principals of Medical Colleges or Medical
Institutions”; as per State Planning Board’s Working Group report
on Health, Nutrition and Sanitation on 10th Five Year Plan (2002 –
2007), the Principals / Superintendent of Medical Colleges have no
administrative or disciplinary control over the staff. Therefore, all the
above categories of paramedical and ministerial staff in Medical College
Hospitals and attached other hospitals have to be appointed directly
by DME and the existing staff must be given freedom to opt for either
DHS or DME and all new appointments must be done separately.
9. Further, the ‘Estimates Committee’ (1998 – 2000) of Kerala Legislature
in its 28th Report recommended that the employees working in the
Medical Colleges such as Nurses, Paramedical Staff are to be
bifurcated from DHS and are to be brought under the control of DME
and the existing staff should be given an opportunity to exercise
option. Subsequent thereto, ‘Estimates Committee’ (2001 – 2004) of
the Kerala Legislature reiterated that employees working in medical
colleges shall be brought under the control of DME and staff which at
present is in existing control of DHS should be afforded an opportunity
to furnish options either of DHS or DME. The State Government
after examining the recommendations in public interest accorded
sanction to abolish the dual control system for the Staff attached to
the Medical Colleges and Hospitals and brought them out from the
administrative and disciplinary control of DHS by issuing the G.O.
(MS) No. 124/2007/H&FWD dated 01.06.2007.
10. While according sanction, the State decided to ask for the options
from existing employees of the DHS to move to the posts which
stood transferred to DME. The relevant clauses of the said G.O. for
understanding are quoted herein below –
[2025] 1 S.C.R.  521

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

"1. The sanctioned posts of all categories of staff

(except doctors in Primary Health Centres who are
appointed by the Health Services Department) such
as Nursing, Paramedical and Ministerial Staff in the
hospitals under the Director of Medical Education will
stand shifted to the service of Directorate of Medical
Education w.e.f. 01.06.2007.
2. The employees of the Health Services Department
now working against these shifted posts shall be
treated as on deputation to the Directorate of Medical
Education, until further orders.
3. The existing employees of Health Services Department
will be given an opportunity to exercise opinion (sic)
to move to the posts transferred to the Director of
Medical Education. A committee will be constituted
under the Chairmanship of Secretary (Health),
with Director of health Services, as Convener for
discussions with service organizations regarding
rules for exercising of option, the arrangements to
be made in the Health Service Department due to
the transfer of these posts, promotion and other
service matters and for submitting recommendations
to Government.
4. The appointing authority of the transferred categories
of posts (except last grade service posts) will be
Director of Medical Education. The Principal will be
the appointing authority of last grade service posts.
5. (i) The appointment to the category / post of Nursing
Assistant now transferred to Directorate of Medical
Education shall be made by direct recruitment and
the special rules will be changed accordingly. The
Director of Medical Education will submit proposals
for qualification for direct recruitment to the post of
Nursing Assistant.
(ii) However, the existing vacancies of Nursing
Assistants are to be filled up by promoting the eligible
Hospital attendants after giving them training. Direct
recruitment as per 5 (i) above shall be done only to
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the remaining vacancies, after giving promotion to

all the eligible Hospital – Attendants.
(iii) Considering the acute shortage of staff, the Last
grade service special rules shall be deemed to be
modified in the public interest in the case of Directorate
of Medical Education only and the Principals are
permitted to make temporary appointment through
Employment Exchange to all the vacant posts in
the categories of Nursing Assistant and Hospital
Grade – I and II, except the vacancies to be kept
apart for promotion of eligible hands in these posts.
(iv) The Secretary (Health) is authorized to obtain
remarks from PSC if required for the implementation
of any of the above decisions and submit proposals.
(v) The steps to transfer of budget allotment for salary
and other items from Director of Health Services to
Director of Medial (sic) Education will be taken up in
consultation with Finance Department.”
xx xx xx xx
11. From the aforementioned G.O., it is also evident that State actively
intended to identify the issues and decided to address them involving
all the stakeholders. After extensive deliberations with all, the
Government of Kerala by G.O. (Ms.) No. 163/07/H&FWD, dated
16.07.2007, constituted a Committee under the Chairmanship of
Additional Secretary (Health) to resolve the issues related to abolition
of dual control system. A meeting was convened on 10.10.2007 with
all the stakeholders inviting their views and suggestions. During
the meeting, highlighting the recommendations of the Estimates
Committee (1998-2000) and Estimates Committee (2001-2004),
consensus was reached to implement the same. After extensive
discussions, the committee framed the ‘Draft Rules’ for options,
‘Draft Option form’, and the qualifications required and method of
appointment for the categories other than the common categories
in DHS and DME, which were required to be absorbed.
12. The Government of Kerala vide G.O. (Rt.) No. 1273/08/H&FWD, dated
07.04.2008, and G.O. (Rt.) No. 2321/08/H&FWD, dated 05.07.2008,
also nominated Administrative Officer, Kerala Heart Foundation along
[2025] 1 S.C.R.  523

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

with Nodal Officers from DHS and DME to coordinate and oversee
the implementation of abolition of dual control system. Based on the
aforesaid, the Committee submitted the ‘Draft Rules’ and also the ‘Draft
Form of option’ to the Government for consideration and approval.
13. Having considered these recommendations, the State Government
issued G.O. (P) No. 548/2008/H&FWD dated 25.10.2008, partially
modifying the G.O. dated 01.06.2007 and directed that all the
ministerial staff, nurses, paramedical staff, including last grade
staff under the establishment of DHS working with the DME, shall
be brought under the administrative control of the DME, subject to
furnishing options as specified in the rules contained in ‘Appendix I’
and form contained in ‘Appendix II’.
14. Appendix I of the G.O. dated 25.10.2008 is titled as ‘Rules for filing
option by the staff, on abolition of dual control systems’. Rule 8
therein governs the seniority of staff who have opted for the DME.
This Rule is central to the present dispute and extracted for ready
reference below –
“…..8. The seniority of the staff opted to Department of
Medical Education will be maintained as per Rule 27(a)
and Rule 27(c) of Part II, KS & SS Rules.”
15. Appendix II of the said G.O. was for option which is in shape of a
form required details of the employee and declaration. The declaration
is relevant, which is extracted hereinbelow for ready reference –
“ DECLARATION
I, …. hereby opt to be absorbed / continued in the
Department of Medical Education and if my option is
accepted, I will not put forth any claim in future to return
to Health Services Department under any provisions.

Place: Signature:
Date: Name and Designation”
xx xx xx xx
16. In furtherance of the G.O. dated 01.06.2007 and G.O. dated
25.10.2008, an ‘Option Cell’ with officers from DHS and DME both
was constituted to scrutinize the option forms submitted by the existing
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employees from DHS. After scrutiny, 3072 options against 6022

transferred posts were found valid, and the list of 3072 employees
‘seniority wise’ and ‘category wise’ was forwarded by DHS for
switching them to DME. In continuance, State Government vide
G.O. (P) No. 56/2009/H&FWD dated 27.02.2009, directed that 6022
posts under DHS establishment will be ‘shifted’ to DME. It was also
made clear vide Order No. PLA1-2462/05/DHS dated 28.02.2009
that lien of the employees whose names were forwarded shall stand
transferred from DHS to DME.
17. In the meantime, since the model code of conduct for the General
Elections of 2009 came into effect from 02.03.2009, therefore, the
said two G.O.s mentioned above could not be implemented. After
elections and on formation of new Government, in supersession of
the previous G.O.s dated 27.02.2009 and 28.02.2009, the G.O. (P)
No. 167/2009/H&FWD dated 17.06.2009 was issued directing that
3096 posts in 57 categories will be forthwith transferred to the DME,
and the DHS will issue orders transferring those employees category
wise and station wise. As such, the employees of DHS included in
the list be continued in DME, as per their options. The employees
of DHS not included in the list of DME were allowed to continue on
deputation as per G.O. 01.06.2007 until further orders.
18. In the meantime, clarifications were sought by the DME about
fixation of seniority of staff who opted for DME from DHS. The State
Government vide its clarificatory letter dated 24.04.2010 clarified
that the seniority of the staff who opted for DME, will be reckoned
as per Rules 27(a) & 27(c) of Part II, KS&SS Rules, i.e., as per
date of order of promotion in case of promotees and as per date
of first effective advice in case of direct recruits (entry cadre) in the
respective categories in the DHS.

Relevant Rules
19. In reference to the various G.O.s, the KS&SS Rules referred above
are also relevant, therefore, extracted here as under –
“27. Seniority – (a) Seniority of a person in a service,
class, category or grade shall, unless he has been reduced
to a lower rank as punishment, be determined by the date
of the order of his first appointment to such service, class,
category or grade.
[2025] 1 S.C.R.  525

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

Explanation – For the purposes of this sub-rule,

“appointment” shall not include appointment under rule 9
or appointment by promotion under Rule 31.
This amendment shall be deemed to have come into force
with effect on and from the 17th December, 1958, but shall
not affect the seniority of any member of a service settled
prior to the date of publication of this amendment in the
Gazette:
Provided that the seniority of persons on mutual or inter-
unit or inter-departmental transfer from one Unit to another
within the same Department or from one Department
to another, as the case may be, on requests from such
persons shall be determined with reference to the dates
of their joining duty in the new Unit or Department. In the
case of more than one person joining duty in the same
grade in the same Unit or Department on the same date,
seniority shall be determined, –
(a) if the persons who join duty belong to different unit
or different departments, with reference to their age,
the older being considered as senior, and
(b) if the persons who join duty belong to the same category
of post in the same department, in accordance with
their seniority in the Unit or Department from which
they were transferred…….
(b) (This sub-rule is not relevant for the case)
(c) Notwithstanding anything contained in clauses (a)
and (b) above, the seniority of a person appointed to
a class, category or grade in a service on the advice
of the Commission shall, unless he has been reduced
to a lower rank as punishment, be determined by the
date of first effective advice made for his appointment
to such class, category or grade and when two
or more persons are included in the same list of
candidates advised, their relatives seniority shall be
fixed according to the order in which their names are
arranged in the advice list:
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Provided that the seniority of candidates who have been

granted extension of time to join duty beyond three months
from the date of the appointment order, except those who
are undergoing courses of study or training which are
prescribed as essential qualification for the post to which
they are advised for appointment, shall be determined by
the date of their joining duty:…….”
20. From contextual perusal of Rule 27(a), the seniority of a person will
be determined from the date of the order of his first appointment to
such service, class, category or grade. Proviso to it deals with the
contingency where an employee asks for transfer mutually or inter-
unit or inter-departmental from one unit to another within the same
Department or from one Department to another as the case may
be. On such transfers, the seniority of the person who requested,
shall be determined from the date of joining and as per clause (a)
and (b) of the said proviso.
21. Thus, accompanying proviso only contemplates determination
of seniority when transfer as specified therein has been sought
mutually and on request. It is relevant to clarify that the language
of the proviso does not deal with the transfers of employees due
to administrative exigencies or their transfer by way of absorption
under the policy decision of the Government bifurcating the dual
control system of the staff.
22. So far as Rule 27(c) is concerned, it deals with the relative seniority
of the employees, by which the inter-se seniority of the employees
appointed to a class, category or grade shall be fixed according
to the order in which their names are arrayed in the first advice
list for his appointment to such class, category or grade. For clear
understanding, we can say the order of recommendations in the
selection list by Commission or Selection Board, at the time of their
selection, shall be relevant for maintaining the relative seniority as
specified in the final advice memo of the Commission or Board as
the case may be.

Findings recorded by learned Single Judge reversed by the

Division Bench
23. The absorbed employees succeeded before learned Single Judge.
The Court referring to Rule 8 of Appendix I of the G.O. dated
[2025] 1 S.C.R.  527

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

25.10.2008, held that seniority of the staff opted for joining DME will
be maintained as per Rules 27(a) and 27(c) of Part II, KS&SS Rules
and they will be entitled to get seniority including their past service
under the DHS in terms of the aforementioned rules. The relevant
findings are reproduced for ready reference as under –
"5. It was thereupon that WP(C) No. 12381/10 and
14091/10 were filed by persons, who were employees
of the DME. According to them, on exercising option
and coming over to DME, the optees should rank
junior most in seniority, and therefore, the clarification,
as contained in Ext. P5 referred to above is illegal.
Therefore, the only question that arises is whether
the optees of DHS who have come over to DME are
entitled to retain their seniority for their prior service
in DHS.
6. In my view, the issue can be answered with reference
to Clause 8 of Appendix I of Ext. P1 order dated
25/10/2008, which provides that seniority of staff
opted to Department of Medical Education will be
maintained as per Rule 27(a) and Rule 27(c) of Part II
KS&SSR. This precisely is what is reiterated in Ext. P5
and this order does not introduce anything which is
not provided in Ext. P1. Clause 8 of Appendix 1 of
Ext. P1 is also not under challenge in WP (C) Nos.
12381/10 or 14091/10. If that be so, necessarily,
optees like the petitioners in WP(C) No.4599/10
and the additional party respondents in WP(C) No.
14091/2010 are entitled to seniority for their prior
services under the DHS in terms of Rules 27(a)
and (c) of Part II KS&SSR.
xx xx xx xx
9. In view of the above, the challenge against Ext. P5
order referred to above dated 24.04.2010 raised in
WP(C) Nos. 12381/10 and 14091/2010 will stand
repelled. The claim of the petitioners in WP(C) No.
4599/10 for maintaining seniority for their service prior
to exercising option, is upheld, in view of Clause 8
of Appendix 1 of Ext. P1 Government Order dated
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25/10/2008 and Ext. P5 dated 24.4.2010 referred

to above. The Directorate of Medical Education is
directed to finalise the inter se seniority list of the
optees and the existing employees of the Department
in accordance with law and as expeditiously as
possible.
24. Being aggrieved, the original employees filed Writ Appeal, which was
allowed and the Division Bench vide impugned judgment set aside
the order of the Single Bench. The findings as returned by Division
Bench are reproduced below for ready reference –
“The dual control system of hospital staff attached to
the Directorate of Medical Education and Directorate of
Health Services was abolished by Government Order
dated 25.10.2008 and clause 8 of Appendix I of thereto
is as follows:
“8. The seniority of the staff opted to Department
of Medical Education will be maintained as per
Rule 27(a) and Rule 27(c) of Part II, KS&SSR”.
2. Many employees in the Department of Health Services
opted for transfer to the Department of Medical Education
and necessarily therefore the proviso to Rule 27(a) of Part
II of KS&SSR extracted below applies:
“Provided that the seniority of persons of mutual
or inter unit or inter departmental transfer from
one unit to another within the same department
or from one department to another, as the case
may be, on request from such persons shall be
determined with reference to the dates of their
joining duty in the new unit or department”.
(emphasis supplied)
3. The seniority of those employees who have opted from
the Department of Health Services can only be determined
with reference to the dates of their joining duty in the
Department of Medical Education. The fact that they
have given their option for an inter-departmental transfer
indicates that it was on their request attracting the proviso
to Rule 27(a) of Part II of KS&SSR.
[2025] 1 S.C.R.  529

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

4. The learned Single Judge has obviously overlooked the

rigour of the proviso to Rule 27(a) of Part II of KS&SSR
which springs into action the moment there is an inter-
departmental transfer on request. We therefore direct that
the seniority of the optees aforesaid shall be determined
with reference to the proviso to Rule 27(a) of Part II of
KS&SSR and the inter se seniority list finalised…..”
25. The Division Bench held that once an employee has furnished his/
her option, it should be termed as ‘inter-departmental’ transfer on
‘request’, hence, proviso to Rule 27(a) of Part II of KS&SS Rules will
be attracted. The said proviso contemplates that seniority of such
employees can be determined with reference to his/her date of joining
duty in DME, which was not duly considered by the learned Single
Judge. These findings of the Division Bench have been assailed
before us in these Appeals.

Rival Contentions
26. We may now refer the submissions of the parties. Learned Senior
Advocate Mr. V. Giri appearing on behalf of absorbed employees
submitted as follows –
26.1 In the present case, the State by a ‘policy decision’ abolished
the ‘dual control’ system of the ‘hospital staff’ between DHS
and DME. The administrative control was given to DME,
however, certain categories such as ‘Nursing, Paramedical and
Ministerial Staff’ were under the governance of DHS. To do away
with the anomaly, State by G.O. dated 25.10.2008 directed
that all ministerial staff, nurses, paramedical staff (including
last grade staff) working under DHS shall be brought under
the administrative control of the DME. The G.O. specifically
stipulated that seniority of the persons who opt for absorption
in DME will be maintained and their ‘lien’ will be shifted.
26.2 Pursuant thereto, out of 12044 posts, as many as 6022 posts
(50%) were ‘shifted’ to DME. DHS employees were given an
option either to retain their post with DHS or opt for DME on the
very same post which they occupied in DHS. After examination,
options of 3072 employees were found to be valid.
26.3 State vide G.O. dated 27.02.2009, directed that the Director
of Heath Service will issue orders transferring the ‘lien’ of
530 [2025] 1 S.C.R.

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those 3072 employees at the disposal of DME. Further, it was

submitted that, essentially, it was never an ‘inter-departmental’
transfer of the employees on their ‘request’. They were given a
‘choice’ to exercise an ‘option’ by the State in furtherance of a
policy decision. Making such a choice would not fall within the
ambit of ‘request’ as stipulated in the proviso to Rule 27(a) of
KS&SS Rules and seniority of the absorbed employees cannot
be reckoned from the date, they joined DME.
26.4 The entire exercise was carried out by a committee set up by
the State after due consultation and by transferring lien to DME,
the service of the absorbed employees rendered in DHS was
specifically protected.
27. Learned Senior Counsel Mr. Raghenth Basant appearing on behalf
of the original employees straight away drew our attention to the
proviso to Rule 27(a) of KS&SS Rules and contended that when any
inter-departmental transfer is made on the ‘request’ of an employee,
then in such case, his/her seniority must be reckoned from the date
of joining the new department. To further buttress, he submitted that –
27.1 Out of 6022 posts that stood transferred to DME from DHS,
only 3072 posts were filled by transferring absorbed employees
from DHS to DME. The remaining posts were filled on
deputation. Even though the inter-departmental transfer was an
administrative decision of the State, the Appendix II – ‘Form of
Option’ annexed with G.O. dated 25.10.2008 reveals that the
absorbed employees had to give a declaration as to ‘Stations
requested for posting’ before getting transferred.
27.2 Once it is settled that it is a case of inter-departmental transfer
subject to filling up of request for posting, proviso to Rule
27(a) of KS&SS Rules will automatically attract for determining
seniority of the transferred employees and as provided, it shall
be from the date of joining duty in the new Unit. Rule 27(c) has
no applicability in the lis at hand.
27.3 This Hon’ble Court in ‘K.P. Sudhakaran and Another Vs. State
of Kerala and Others1’ while dealing with issue of seniority and
applicability of Rule 27(a) of KS&SS Rules, has categorically

1 (2006) 5 SCC 386

[2025] 1 S.C.R.  531

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

held that on transfer, the employee has to forego his past service
and his seniority will be determined from the date of his joining
duty in the new department/unit.
27.4 Lastly, if the seniority of the original employees vis-à-vis absorbed
employees is reckoned from the date of initial appointment of
absorbed employees, then it will cause grave prejudice since
original employees were never given an option.
28. Learned Senior Counsel Mr. Jaideep Gupta appearing on behalf of
the State, argued in support of the appellants – absorbed employees
and at the outset submitted that there is no question of prejudice
being caused to original employees for the reason that, after the
abolition of dual control system, the original posts in DHS along
with their promotional posts in respective category were transferred
to DME. In other words, effectively additional posts as they existed
in DHS were shifted to DME. The options were exercised by the
absorbed employees only on the premise of assured seniority and
on absorption to DME, if they are placed at the bottom of seniority
list in the respective category, they will have to forego their previous
service. This was never the intention of the Government of Kerala
while taking the policy decision.
29. Generally, in inter-departmental transfers, only the employee is
transferred to the respective post, however, in the present case, the
post itself along with the employee have been shifted. DHS employees
were given an option to switch to DME after policy decision and
transfer of posts to DME. The said option was never in the nature
of request as contemplated under proviso to Rule 27(a) of KS&SS
Rules. Hence, the said proviso has no bearing on the inter-se seniority
between the original employees and absorbed employees.

Analysis of contentions and reasonings

30. After hearing learned counsel for the parties at length, in our view
the short question which falls for consideration is ‘whether the
option exercised by DHS employees to join DME pursuant to a
policy decision of the State of Kerala ought to be considered as
an option for absorption or a request for transfer under proviso
to Rule 27(a) of KS&SS Rules and in that situation, the inter-se
seniority of such employees in the DME shall be reckoned from
which date?’
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31. Having perused the material placed, it is luculent that in furtherance

to the policy decision of the Government and on account of abolition
of the dual control system, employees of the DHS were required to
be transferred by way of absorption to DME in public interest looking
to the administrative exigency. In furtherance as per G.O. (Ms.)
No. 124/07/H&FWD dated 01.06.2007, existing staff of DHS were
required to be switched to DME for implementation of the said
decision. In this connection, the Government first decided to identify
the issues and invited the stakeholders to deliberate. A meeting
was convened under the Chairmanship of the Additional Secretary,
Health, on 10.10.2007 and taking note of the recommendations of
the Estimates Committees 1998-2000 and 2001-2004, it was decided
to abolish the dual control system to increase the efficiency of public
administration. In furtherance, the Committee framed the ‘Draft Rules
for Option’ and ‘Draft Option Form.’ As per the Government order
vide G.O. (Rt.) No. 1273/08/H&FWD dated 07.04.2008 and G.O. (Rt.)
No. 2321/08/H&FWD dated 05.07.2008, the Government nominated
nodal officers of the DHS and DME and the Administrative Officer
from the Kerala Heart Foundation to coordinate the activities in
connection with the implementation of abolition of dual control system.
They prepared the list of such staff of various categories and grade
working under their control and also the list of employees along with
the posts for transfer to the DME. On receiving the information, the
Government examined those in detail and was of the view that the
existing qualification and method of appointment for the posts in
DHS will be followed for appointment to the post after shifting them
to DME and modification, if any, shall be considered separately.
32. In consequence, the Government after partial modification in
G.O. (Ms.) No. 124/07/H&FWD dated 01.06.2007, issued the
G.O. (P) No. 548/2008/H&FWD dated 25.10.2008, and the
recommendations made therein are enumerated as under –
(i) All the ministerial staff, nurses, paramedical staff
including the last grade staff under the establishment
of Director Health Services and now working in the
Medical Education Department will be brought under
the administrative control of Director of Medical
Education subject to filing of option in accordance
with the Rules for option. The Rules of option is
given in Appendix-I and Form of option is given in
[2025] 1 S.C.R.  533

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

Appendix II. The category-wise list and number of

post as above is given in Appendix Ill. The persons
who opt for the Medical Education Department from
the Health Services Department will be allotted to
the Medical Education Department based on the
seniority in service. The option will be applicable
only for the staff of Health Services Department. The
staff of Health Services Department now working
under Director of Medical Education also will have
to file option if they wish to continue in the Medical
Education Service.
(ii) The staff of Health Services Department will file
option in the prescribed form in Appendix-II. If the
number of persons in a particular category who opt
to the Medical Education Department is in excess
of the sanctioned strength of that category in
Medical Education Service, the senior most among
such persons will be shifted to Medical Education
Service as per Rule 27(a) and 27(c) of Part II KS
& SSRs, subject to their option. If sufficient options
are not received for a particular post, the junior
most person will be shifted to the Medical Education
Department from the Health Services Department
making mandatory posting according to seniority. If
staff is in surplus in that category in Health Services
Department, such mandatory posting will continue till
such time Director of Health Services has no surplus
staff under any category.
(iii) The employees will file option in the prescribed
form in Appendix II duly recommended by the head
of office, to the Senior Administrative Officer (Dual
Control Option Cell), Office of the Director of Health
Services, Thiruvananthapuram. The employees shall
file option within a period of 45 days from the date
of this order.
(iv) The option form will be scrutinized by a Cell, with the
following staff, within a period of one month thereafter,
that is by 15.1.2009. The Cell will function in the office
of the Director of Health Services.
534 [2025] 1 S.C.R.

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(1) The Senior Administrative Officer, Health

Services Department, Thiruvananthapuram
(Convener).
(2) The Administrative Officer, Medical Education
Department, Thiruvananthapuram.
(3) T h e A d m i n i s t r a t i v e O f f i c e r, K e r a l a
Heart Foundation, Medical College,
Thiruvananthapuram.
(4) The Administrative Assistant, Health Services
Department, Thiruvananthapuram.
(5) The Administrative Assistant, Medical Education
Department, Thiruvananthapuram.
(6) 2 Clerks each from the Medical Education
Department and Health Services Department,
Thiruvananthapuram.
(v) The Director of Health Services will issue orders transferring
the employees on the basis of options received, subject
to the Draft Rules in Appendix I, before 31.01.2009.
The Director of Health Services and Director of Medical
Education will identify the surplus staff thereafter, if any,
after completion of the process, to Government and Director
of Medical Education will identify the surplus staff in all
categories and report to Government after 31.1.2009.
By order of the Governor,
Dr. Vishwas Mehta,
Secretary (Health)”
33. From the above, it can clearly be spelt out that by the mechanism
carved out, the employees of the DHS were required to be transferred
along with the posts to DME by way of absorption in the exigency
of public administration and necessity. The factum of absorption
by way of transfer is clear from the declaration of Appendix II of
G.O. dated 25.10.2008, i.e., the form prescribing details of the
employees and attached declaration, by which it is clear that the
employees have opted for absorption in DME and wish to continue
and do not intend to return to DHS as referred in paragraph 15 of
the judgment.
[2025] 1 S.C.R.  535

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

34. After receiving the declaration and Appendix II, the Committees of
the officials of DHS and DME made recommendations for transferring
3096 posts of 57 categories and accordingly, the Government of
Kerala issued G.O. (P) No. 167/2009/H&FWD dated 17.06.2009,
including the names and posts of those employees whose options
were found valid. After passing such order, the issue arose regarding
seniority of the employees absorbed in DME. In this regard, a
clarificatory letter was issued by the Government on 24.04.2010,
specifying that the seniority of the staff who opted for DME shall be
reckoned as per Rule 8 of Appendix I of G.O. dated 25.10.2008 in
terms of Rules 27(a) and 27(c) of Part II of KS&SS Rules. It was
clarified that in case of promotion the seniority shall be reckoned from
the date of promotion and in case of direct recruit (entry cadre) as per
the date of first effective advice issued at the time of appointment.
35. The reference of above Rule 8 of Appendix I is in paragraph 14
of the judgment whereby, the seniority of the staff who opted for
absorption to DME will be maintained as per Rule 27(a) and 27(c)
of Part II, KS&SS Rules. The word ‘maintained’ used for seniority
has its own significance and be further referred for inter-se seniority
of the absorbed employees in terms of the said Rules.
36. The Rule 27(a) as quoted in paragraph 19 of judgment above
emphasizes that seniority of a person in service in any class, category
or grade shall be determined from the date of order of first appointment
to the service unless he has been reduced to lower rank by way of
punishment. Its proviso only deals with the contingencies wherein
an employee seeks transfer on request as specified or applied
mutually. Therefore, the proviso applies only for the contingencies
of mutual or inter-unit or inter-departmental transfer from one unit
to another within the same department or from one department to
another as the case may be on request by such employee. It does
not apply to the cases in which transfer is made by the Government
in administrative exigency or the transfer by way of absorption under
policy decision of the Government.
37. In our view, the intent of Rules 27(a) and 27(c) is clear that seniority
be reckoned from the order of his first appointment and the inter-se
seniority be determined as per the date of first effective advice made
for his appointment in service, class, category or grade as the case
may be. The proviso of Rule 27(a) is merely an exception to the
536 [2025] 1 S.C.R.

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said Rule of maintaining the seniority from the date of appointment

in the cases of ‘on request’ and mutual transfer. The said exception
does not attract in a case of transfer by way of absorption made by
the Government in public interest or in administrative exigencies.
Thus, proviso to Rule 27(a) is an exception to the transfer on
administrative grounds in public interest. The said fact is also clear
from the Rules framed in Appendix I, and Option Form of Appendix II
and its declaration as contained in G.O. dated 25.10.2008, by which
the employee has furnished option for absorption without making
any request for transfer.
38. The whole dispute revolves around the interpretation of the words
transfer on request, transfer applied mutually and transfer by way
of absorption. In the said context, it is necessary to lay emphasis
on the definition of transfer as given in Kerala Service Rules (KSR),
1959, which reads as under: -
“(36) ‘Transfer’ – means the movement of an officer
from one headquarter station in which he is employed to
another to such station, either,
(a) to take up the duties of a new post, or
(b) in consequence of a change of his headquarter.”
The said definition postulates the change of headquarter or station to
another either to take up the duties of a new post or in consequence
of change of headquarter. Indeed, the said change may be on request
as prescribed in proviso to Rule 27(a) of KS&SS Rules or on his/
her mutual request based on the needs of the employees who have
applied or for administrative reason in public interest. As discussed,
the said proviso only deals with first two contingencies and not the
last one, i.e., transfer in public interest for administrative reason.
39. The transfer of an employee is an incidence of service if it is in
public interest. It cannot be disputed that the Government is the
best judge to decide how to distribute and utilise the services of an
employee. Simultaneously, if employee makes a request due to some
hardship and if the authority or the Government as the case may
be is satisfied, it may post such employee as per request, but such
transfer cannot be termed as transfer in public interest because it
is on the request of the employee and not in the exigencies of the
public administration.
[2025] 1 S.C.R.  537

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

40. Here, it is a case of transfer by way of absorption. Now, to deal with

the meaning of absorption, we can profitably refer to the different
glossaries. As per P. Ramanatha Aiyar’s Advanced Law Lexicon, 7th
Edition, ‘absorption’ means ‘to take in. On absorption, the employee
becomes part and parcel of the department absorbing him and
partakes the same colour and character of the existing employees
of the department.’
41. In Corpus Juris Secundum (CJS), ‘absorb’ is defined as ‘to suck up;
to drink in, to imbibe; to draw in as a constituent part; and it has
been said to be also a synonym of “consume”.
42. On perusal of the above, it is clear that if transfer is by absorption,
then such employee becomes part and parcel of the department
absorbing him and partakes the same colour and character of the
existing employees. In other words, absorb clearly indicates to suck
up, to imbibe to draw as a constituent part and consume.
43. In addition, the words option and request have different meanings
which require further emphasis. In colloquial usage, Merriam-Webster
defines ‘option’ as – ‘an act of choosing; the power or right to choose:
freedom of choice; something that may be chosen’, whereas, ‘request’
is defined as – ‘by asking for something, usually in a formal way’.
44. In legal usage, Black’s Law Dictionary defines ‘option’ as – ‘right
or power to choose; something that may be chosen’. On the other
hand, it defines ‘request’ as – ‘an asking or petition; the expression
of a desire to some person for something to be granted or done’.
45. In P. Ramanatha Aiyar’s Advanced Law Lexicon, 7 th Edition, ‘option’
is defined as – ‘simply choice or freedom of choice. The essential
requisites of an option or election is that a party opting should be
cognizant of his right. The party must have the knowledge of his or
her right and of those circumstances which will influence the exercise
of option. The person to whom an option is given in regard to any
matter must be left to his own free will to take or do one thing or
another.’ and ‘request’ is defined as ‘a demand or requirement’.
46. After going through the definitions, it is clear that option gives a right
to choose with freedom of choosing amongst the choices presented
to the person concerned, whereas a request is the desire of a person
to be granted something by asking or is a demand or requirement
of the employee.
538 [2025] 1 S.C.R.

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47. In the present case, the transfer has been made by way of absorption
on the basis of option and not on the basis of request. The said
absorption was in furtherance to a policy decision of the Government
to abolish the dual control system enhancing the efficiency of the
administration of medical colleges and attached hospitals thereto
giving it to DME withdrawing from DHS. Therefore, the transfer by
way of absorption on exercise of option as specified in Appendix I
and Appendix II contained in G.O. dated 25.10.2008 does not attract
the proviso to Rule 27(a) of KS&SS Rules, which only deals with
the transfer on request or on mutual request. Thus, the action taken
in public interest due to administrative exigency even on option is
different than the action done on request. In our view, the proviso to
Rule 27(a) does not attract in case of a transfer by way of absorption
done by the Department in furtherance to the policy decision of the
Government. Therefore, transfer by way of absorption in public interest
cannot be equated with the transfer on request in contingencies as
specified in proviso to Rule 27(a) or applied mutually.
48. In the fact situation of the present case, the judgment of Full Bench
of the Punjab and Haryana High Court in the case of ‘Kartar Singh
v. State of Punjab, 1989 SCC OnLine P&H 482’, is relevant. The
Full Bench in a similar situation while dealing with the issue of
seniority of Patwaris working in the State’s Consolidation Department
who were absorbed into the Revenue Department held that the
employees of Consolidation Department after absorption into the
Revenue Department, will have the benefit of length of service in
the Consolidation Department, on the new post. While concurring
the view, in the separate note, Justice M.M. Punchhi, expressed his
view that absorption is akin to amalgamation, in the sense that, an
employee becomes part and parcel of the department absorbing him
and partakes the same colour and character of the existing employees
of the department, classified as promotees, direct appointees or
transferees. In the facts discussed in detail above, definition of
absorption which was based on option and the definition of request
discussed above, we concur with the view taken by the Punjab and
Haryana High Court by the said Full Bench.
49. At this stage, the judgment relied upon by the learned Senior Counsel
Mr. Raghenth Basant representing private respondents in the case of
K.P. Sudhakaran and Anr. (supra) is also relevant to refer wherein
interpretation of Rule 27 of KS&SS Rules was expressly made in the
[2025] 1 S.C.R.  539

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

context of the transfers of employees on request and maintaining the

seniority. This Court dealt the proviso to Rule 27(a) in paragraph 11
and observed as thus:
“11. In service jurisprudence, the general rule is that if a
government servant holding a particular post is transferred
to the same post in the same cadre, the transfer will not
wipe out his length of service in the post till the date of
transfer and the period of service in the post before his
transfer has to be taken into consideration in computing the
seniority in the transferred post. But where a government
servant is so transferred on his own request, the transferred
employee will have to forego his seniority till the date
of transfer, and will be placed at the bottom below the
junior most employee in the category in the new cadre
or department. This is because a government servant
getting transferred to another unit or department for his
personal considerations, cannot be permitted to disturb the
seniority of the employees in the department to which he is
transferred, by claiming that his service in the department
from which he has been transferred, should be taken
into account. This is also because a person appointed
to a particular post in a cadre, should know the strength
of the cadre and prospects of promotion on the basis of
the seniority list prepared for the cadre and any addition
from outside would disturb such prospects. The matter is,
however, governed by the relevant service rules.”
In the case, Court dealing with clause (a) and (c) of Rule 27 of the
said Rules further observed as under –
“16. A careful reading of clause (c) shows that it did in no
way affect the contents of proviso to clause (a) of Rule 27
inserted by amendment by GO dated 13-1-1976. Clause (a)
of Rule 27 provided that seniority of a person in a service,
class, category or grade shall be determined by the date
of the order of his first appointment to such service, class,
category or grade. Clause (b) provides that the appointing
authority shall, at the time of passing an order appointing
two or more persons simultaneously to a service, fix the
order of preference among them, and seniority shall be
540 [2025] 1 S.C.R.

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determined in accordance with it. Clause (c) made it clear

that notwithstanding anything contained in clauses (a)
and (b), where a person is appointed to a class, category
or grade in a service on the advice of the Commission, the
seniority of such person shall be determined by the date
of first effective advice made for his appointment to such
class, category or grade and when two or more persons
are included in the same list of candidates advised, their
relative seniority shall be fixed according to the order in
which their names are arranged in the advice list. The
effect of clause (c) is to clarify the date with reference
to which seniority should be reckoned when they are
initially appointed on the advice of the PSC. It only means
that where the appointments are from the selection
list published by PSC, their seniority will be reckoned/
determined by the first effective advice made for such
appointment by PSC and not by the actual date of his
appointment by the appointing authority. Clause (c) has
therefore no effect or application over the proviso which
regulates subsequent “own-request” transfers.”
50. The Court with said observations concluded that if the request is made
for transfer by an employee and accepted by the authority, then on
joining the transferred post, seniority be counted from the date of his
joining at new place foregoing the previous service and advantage
of clause (c) of Rule 27 is not available to such employee. The said
judgment is of no help to private respondents – original employees
since the transfer in the present case is in the administrative
exigencies by way of absorption. As discussed above, the absorption
based on option is completely different than the transfer on request
and the said judgment rather fortifies the discussions made above
and favours the case of the absorbed employees.
51. In conclusion, we can observe that in furtherance to the conscious
policy decision of the Government, abolition of dual control system
was inevitable, therefore, bifurcation of DHS and DME was directed
based on the recommendations. The employees existing in DHS were
absorbed in DME along with posts and lien. In the present case,
in terms of the G.O. (P) No. 548/2008/H&FWD dated 25.10.2008,
particularly Rule 8 of Appendix I, seniority of the absorbed employee
cannot be disturbed applying the proviso of Rule 27(a) of KS&SS
[2025] 1 S.C.R.  541

Geetha V.M. & Ors. v. Rethnasenan K. & Ors.

Rules. Learned Senior counsel representing the State has supported

the said view pointing out that while forming the policy for transfer
by way of Appendix I, II and III, the Government never intended
to forgo the seniority of the employees in any class, category and
grade existing in service of DHS and absorbed in DME. Therefore,
the Government has specifically mentioned in Rule 8 of Appendix I
that the seniority of such employee shall be ‘maintained’ as per
Rule 27(a) and 27(c) of Part II of KS&SS Rules giving due weightage
to the service rendered by them in DHS while absorbing in DME.
52. In totality of facts as discussed, the inescapable conclusion that can
be drawn is that the transfer of appellants – absorbed employees was
by way of absorption as per the policy decision of the Government of
Kerala and it would not fall within the purview of proviso to Rule 27(a)
of KS&SS Rules. The appellants exercised the option for absorption
by transfer from DHS to DME in line with the policy decision taken
by Government of Kerala and not on their own volition. Such being
the situation, it cannot be considered as a case of transfer based on
voluntary choice or own request. Their seniority and inter-se seniority
shall be maintained as per Rule 27(a) and 27(c) of Part II of KS&SS
Rules read with clarificatory letter dated 24.04.2010 with reference
to Rule 8 of Appendix I to G.O. dated 25.10.2008. The question as
framed by us in paragraph 30 is answered accordingly.
53. In view of the foregoing discussion, we are of the considered
opinion that the findings recorded by the Division Bench reversing
the judgment of learned Single Judge are without due consideration
of the material placed and based on wrong interpretation of rules.
Therefore, such findings and the judgment stand set-aside.
54. Resultantly, the present appeals are allowed. The State of Kerala
is directed to draw the seniority list of DME employees, including
original and absorbed employees, reckoning the seniority of the
absorbed employees as directed in paragraph 52 above. Pending
interlocutory applications (if any) stand disposed-of.

Result of the case: Appeals allowed.

†
Headnotes prepared by: Divya Pandey
 [2025] 1 S.C.R. 542 : 2025 INSC 42

Indian Evangelical Lutheran Church Trust Association

v.
Sri Bala & Co.
(Civil Appeal No. 1525 of 2023)
08 January 2025
[B.V. Nagarathna* and Nongmeikapam Kotiswar Singh, JJ.]

Issue for Consideration

Whether the plaint in the subsequent suit for specific performance
filed by the plaintiff, i.e., O.S. No. 49/2007, is liable to be rejected in
terms of Order VII Rule 11(d) of the Code of Civil Procedure, 1908
on the ground that the said suit is barred by the law of limitation.

Headnotes†
Code of Civil Procedure, 1908 – Or. VII, r.11(d) – Limitation Act,
1963 – Arts. 54 and 113 – The plaintiff filed an unnumbered suit
in the year 1993 for specific performance of the agreement to
sell dated 26.04.1991 – The said suit was rejected vide order
dated 12.01.1998 due to non-payment of requisite court-fees
by the plaintiff – Thereafter, plaintiff filed second suit O.S. No.
49/2007 in the year 2007 for specific performance of agreement
to sell dated 26.04.1991 – The defendant sought rejection of
the second suit by filing I.A. u/Or. VII, r.11(d) of the CPC, which
was dismissed by the Trial Court – The High Court confirmed
the order passed by the Trial Court – Correctness:
Held: In the instant case, the respondent/plaintiff had filed the suit
for specific performance of the agreement to sell dated 26.04.1991
in the year 1993 itself – The plaint in the said suit was rejected
on 12.01.1998 – The plaintiff could have filed the second suit on
or before 12.01.2001 as it got right to file the suit on 12.01.1998
on the rejection of the plaint in the earlier suit filed by it – This is
on the basis of Or. VII, r.13 of the Code – However, the limitation
period expired in January, 2001 itself and the second suit was filed
belatedly in the year 2007 – The cause of action by then faded and
paled into oblivion – The right to sue stood extinguished – The suit
was barred in law as being filed beyond the prescribed period of
limitation of three years as per Article 113 to the Schedule to the
Limitation Act – Hence the second suit is barred u/Or. VII, r.11(d)
of the Code – Therefore, the plaint in O.S No. 49/2007 filed by the
* Author
[2025] 1 S.C.R.  543

Indian Evangelical Lutheran Church Trust Association v.

Sri Bala & Co.

respondent herein is rejected – There is absence of any evidence

being recorded on the issue of limitation – This is on the admitted
facts – Thus, on the basis of Or. VII, r.11(d) of the Code r/w. Art.113
of the Limitation Act, the impugned orders of the High Court and
the Trial Court are set aside and the application filed u/Or. VII,
r.11(d) of the Code is allowed. [Para 9.12]

Limitation Act, 1963 – Nature and scope:

Held: The Limitation Act, 1963 consolidates and amends the law
of limitation of suits, appeals and applications and for purposes
connected therewith – The law of limitation is an adjective law
containing procedural rules and does not create any right in
favour of any person, but simply prescribes that the remedy can
be exercised only up to a certain period and not beyond – The
Limitation Act therefore does not confer any substantive right,
nor defines any right or cause of action – The law of limitation is
based on delay and laches – Unless there is a complete cause of
action, limitation cannot run and there cannot be a complete cause
of action unless there is a person who can sue and a person who
can be sued. [Para 9]

Law of Limitation – Right of plaintiff:

Held: The barring of the remedy under the law of limitation on the
expiry of the limitation period would not imply plaintiff’s right being
extinguished – Only the possibility of obtaining a judicial remedy
to enforce the right is taken away – However, in certain cases,
the expiry of the period of limitation would extinguish the plaintiff’s
right to seek remedy entirely. [Para 9.2]

Limitation Act, 1963 – Art. 113 – Residuary Article – Omnibus

Article:
Held: If a suit is not covered by any of the specific articles prescribing
a period of limitation, it must fall within the residuary article – The
purpose of the residuary article is to provide for cases which could
not be covered by any other provision in the Limitation Act – The
residuary article is applicable to every variety of suits not otherwise
provided for under the Limitation Act – It prescribes a period of
three years from the date when the “right to sue” accrues – Under
Article 120 of the erstwhile Limitation Act, 1908, it was six years,
which has been reduced to three years under Article 113 of the
present Act – Article 113 of the Limitation Act is an omnibus Article
544 [2025] 1 S.C.R.

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providing for a period of limitation not covered by any of the specific

Articles. [Paras 9.4, 9.6]

Limitation Act, 1963 – Art. 113 – When the ‘right to sue’ accrues:
Held: The right to sue under Article 113 of the Limitation Act
accrues when there is an accrual of rights asserted in the suit
and an unequivocal threat by the defendant to infringe the right
asserted by the plaintiff in the suit – Thus, “right to sue” means the
right to seek relief by means of legal procedure when the person
suing has a substantive and exclusive right to the claim asserted
by him and there is an invasion of it or a threat of invasion – When
the right to sue accrues, depends, to a large extent on the facts
and circumstances of a particular case keeping in view the relief
sought – It accrues only when a cause of action arises and for a
cause of action to arise, it must be clear that the averments in the
plaint, if found correct, should lead to a successful issue – The
use of the phrase “right to sue” is synonymous with the phrase
“cause of action” and would be in consonance when one uses the
word “arises” or “accrues” with it. [Para 9.8]

Limitation Act, 1963 – Arts. 54 and 113 – The second suit was
filed after rejection of the plaint in the earlier suit for seeking
specific performance of a contract – What is the period of
limitation of filing second suit:
Held: In the present case, the earlier suit was filed by the
respondent/plaintiff in July, 1993 on the basis of Article 54 and the
plaint in the said suit was rejected on 12.01.1998 – The second
suit being O.S. No. 49/2007 was filed on the strength of Order
VII Rule 13 of the Code for the very same cause of action and
for seeking the very same relief of specific performance of the
agreement dated 26.04.1991 as the plaint in the earlier suit was
rejected on 12.01.1998 – Therefore, it cannot be said that the
second suit namely O.S. No. 49/2007 was filed as per Article 54
of the Limitation Act – Since this is a suit filed for the second time
after the rejection of the plaint in the earlier suit, in view of this
Court, Article 54 of the Limitation Act does not apply to a second
suit filed for seeking specific performance of a contract – Then, the
question is, what is the limitation period for the filing of O.S. No.
49/2007 – One have to fall back on Article 113 of the Limitation
Act – Article 113 of the Limitation Act is an omnibus Article providing
for a period of limitation not covered by any of the specific Articles –
[2025] 1 S.C.R.  545

Indian Evangelical Lutheran Church Trust Association v.

Sri Bala & Co.

Article 113 of the Schedule to the Limitation Act provides for a

suit to be instituted within three years from the date when the
right to sue accrues. [Paras 9.6, 9.7, 9.9]

Case Law Cited

T. Arivandandam v. T.V. Satyapal [1978] 1 SCR 742 : (1977) 4
SCC 467; Sopan Sukhdeo Sable v. Assistant Charity Commissioner
[2004] 1 SCR 1004 : (2004) 3 SCC 137; Popat and Kotecha
Property v. State Bank of India Staff Association [2005] Supp.
2 SCR 1030 : (2005) 7 SCC 510; Roop Lal Sathi v. Nachhattar
Singh Gill [1983] 1 SCR 702 : (1982) 3 SCC 487; Raptakos Brett
& Co. Ltd. v. Ganesh Property [1998] Supp. 1 SCR 485 : (1998)
7 SCC 184; Saleem Bhai v. State of Maharashtra [2002] Supp. 5
SCR 491 : (2003) 1 SCC 557; R.K. Roja v. U.S. Rayudu [2016] 3
SCR 221 : (2016) 14 SCC 275; Kuldeep Singh Pathania v. Bikram
Singh Jaryal [2017] 1 SCR 915 : (2017) 5 SCC 345; Maqsud
Ahmad v. Mathra Datt & Co., AIR 1936 Lah 1021; Sejal Glass
Ltd. v. Navilan Merchants Private Ltd. [2017] 7 SCR 557 : (2018)
11 SCC 780; Madhav Prasad Aggarwal v. Axis Bank Ltd. [2019]
8 SCR 1058 : (2019) 7 SCC 158; Biswanath Banik v. Sulanga
Bose [2022] 3 SCR 302 : (2022) 7 SCC 731; Delhi Wakf Board v.
Jagdish Kumar Narang (1997) 10 SCC 192; A. Nawab John v. V.N.
Subramaniyam [2012] 6 SCR 369 : (2012) 7 SCC 738; Mannan
Lal v. Mst. Chhotaka Bibi, (Dead) by LRs. [1971] 1 SCR 253 : (1970)
1 SCC 769; Patil Automation Private Ltd. v. Rakheja Engineers
Private Ltd. (2022) 10 SCC 1; State of Punjab v. Gurdev Singh
[1991] 3 SCR 663 : (1991) 4 SCC 1; Shakti Bhog Food Industries
Ltd. v. Central Bank of India [2020] 6 SCR 538 : (2020) 17 SCC
260; M.V.S. Manikyala Rao v. M. Narasimhaswami [1966] 1 SCR
628 : AIR 1966 SC 470; N Narasimhiah v. State of Karnataka
[1996] 1 SCR 698 : (1996) 3 SCC 88 – referred to.
Pioneer Bank Ltd v. Ramdev Banerjee (1950) 54 Cal WN 710;
James Skinner v. Kunwar Naunihal Singh, ILR (1929) 51 All 367,
(PC) – referred to.

Books and Periodicals Cited

“Limitation Periods” by Andrew McGee, Barrister of Lincoln’s
Inn, published in 2002; Tagore Law Lectures, U N Mitra, Law of
Limitation and Prescription, Sixteenth Edition, Volume 1, Sections
1-32 & Articles 1-52.
546 [2025] 1 S.C.R.

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List of Acts
Charitable and Religious Trust Act, 1921; Limitation Act, 1963;
Limitation Act, 1908; Code of Civil Procedure, 1908.

List of Keywords
Specific Performance; Rejection of plaint; Cause of Action; Barred
by Limitation; Res-Judicata; Order VII Rule 11 of Code of Civil
Procedure, 1908, Order VII Rule 13 of Code of Civil Procedure,
1908; Article 54 of Limitation Act, 1963; Article 113 of Limitation
Act, 1963; Right to sue; Residuary Article; Omnibus Article; Right
of plaintiff.

Case Arising From

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1525 of 2023
From the Judgment and Order dated 15.03.2022 of the High
Court of Judicature at Madras at Madurai in CRPMD No. 1116
of 2011

Appearances for Parties

P.V. Balasubramaniam, Sr. Adv., Anish R. Shah, Ankit Sahu,
Advs. for the Appellant.
V. Giri, Sr. Adv., Mahesh Agarwal, Rishi Agrawala, Ankur Saigal,
Ms. S. Lakshmi Iyer, Ms. Sukriti Bhatnagar, Shaswat Singh,
E. C. Agrawala, Advs. for the Respondent.

Judgment / Order of the Supreme Court

Judgment

Nagarathna, J.
This appeal has been filed by assailing the order dated 15.03.2022
passed by the Madras High Court, Madurai Bench in C.R.P. (MD)
No.1116 of 2011 dismissing the Civil Revision Petition filed by the
appellant.
1.1. For the sake of convenience, the parties in the present appeal
are being referred to as per their status and positions before
the trial court.
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Indian Evangelical Lutheran Church Trust Association v.

Sri Bala & Co.

Factual Background:
2. According to the plaintiff/respondent herein, the present dispute
pertains to land measuring 5.05-acre being a portion of a 6.48-acre
property known as Loch End at Kodaikanal, originally purchased
by American missionaries of the Lutheran Church Missouri Synod
and Missouri Evangelical Lutheran India Mission in 1912. The
Kodaikanal International School (seeking to implead in the suit) is
located across the road from Loch End. In 1975, an agreement was
made between the American missionaries and the India Evangelical
Lutheran Church Trust Association (defendant/ appellant herein) to
transfer various properties, including the Kodaikanal property, to the
defendant. This agreement was formalized through the joint filing of
O.P. No.101/1975 under Section 7 of the Charitable and Religious
Trust Act, 1921 before the District Judge, Madurai, leading to a
decree dated 26.11.1975, appointing the defendant as the trustee
of those properties for the objects of the Trust stated thereunder.
2.1. According to the plaintiff, the defendant being in need of funds
decided to sell a part of those properties, including the 5.05 acres
of Loch End, consisting of 12 out of 15 buildings (hereinafter
referred to as “suit scheduled property”). An agreement to sell
was executed on 26.04.1991 between the defendant and the
plaintiff, i.e., M/s. Sri Bala & Co., for the suit scheduled property,
on a total sale consideration fixed at Rs.3,02,00,000/- (Rupees
Three Crores and Two Lakhs only) and an advance payment
of Rs. 10,00,000/- (Rupees Ten Lakhs only) was made. Partial
possession of the property is said to have been handed over
to the plaintiff. At that time, the impleading party was allegedly
in possession of three of the twelve buildings on Loch End in
the capacity of a tenant.
2.2. The plaintiff filed an unnumbered suit in the year 1993 before
the Court of the Subordinate Judge, Dindigul Anna District for
specific performance of the agreement to sell dated 26.04.1991,
by seeking execution of the sale deed in respect of the suit
scheduled property and for placing the plaintiff in possession
of the property. The said suit was subsequently transferred to
the Court of the Subordinate Judge, Palani. But the said suit
was rejected vide order dated 12.01.1998 passed by the Court
of Subordinate Judge, Palani due to non-payment of requisite
court-fees by the plaintiff.
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2.3. The plaintiff thereafter filed O.S. No.49/2007 before the Court
of the Principal District Judge, Dindigul District, seeking specific
performance of the sale agreement dated 26.04.1991, with a
direction to the defendant to execute the sale deed in favour
of the plaintiff after receiving the balance sale consideration for
the suit scheduled property.
2.4. The defendant sought rejection of the second suit by filing
I.A. No.233/2007 under Order VII Rule 11(d) of the Code of
Civil Procedure, 1908 (for short, “Code”), on the ground that
the subsequent suit for specific performance is barred by the
principle of res judicata as the plaintiff had not filed any appeal
against the rejection of the plaint in the previous suit. The
defendant also contended that the subsequent suit for specific
performance was barred by the law of limitation since it was
filed after a gross delay of almost nine years and beyond the
period stipulated under Article 54 of the Limitation Act, 1963
(“Limitation Act”, for short).
2.5. The plaintiff filed its objections to the defendant’s application
for rejection of plaint and placed reliance on Order VII Rule
13 of the Code to argue that a rejection of a plaint does not
preclude the presentation of a fresh plaint for the same cause
of action. It was further contended by the plaintiff that as per
the sale agreement, the Kodaikanal International School,
which is in possession of part of the suit scheduled property
in the capacity of a tenant, has to be evicted and the vacant
possession ought to be handed over to the plaintiff. Since the
tenants had not been vacated from the property, the suit for
specific performance of the sale agreement is not barred by
Article 54 of the Limitation Act. Reliance was placed by the
Plaintiff on an extension letter dated 15.07.1991 executed by
the defendant’s Secretary-cum-Treasurer namely Reverent
A. Sundaram in favour of the plaintiff, which had extended
the period of the sale agreement in light of multiple pending
litigations with the impleading party.
2.6. The said application, i.e., I.A. No.233/2007, was dismissed by
the trial court vide order dated 16.09.2010, on the grounds
that the previous suit was not decided on merits and therefore
the principle of res judicata would not apply and further, the
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Sri Bala & Co.

issue of limitation period being extended to file the suit for

specific performance in light of the pending litigations with the
impleading party was a question of fact and the said issue had
to be adjudicated only after examination of proper witnesses
and documents during trial. Thus, the trial court refused to reject
the plaint at such an early stage.
2.7. Being aggrieved by the order of the trial court, defendant
preferred a civil revision petition before the High Court being
C.R.P. (MD) No.1116/2011. However, the High Court on
15.03.2022 dismissed the said Civil Revision Petition. The High
Court observed that the previous suit was neither registered
nor numbered and since the issues were not finally decided, it
was not hit by the principle of res judicata. Further, the question
of extension of the limitation period is a mixed question of
fact and law which can be decided only after the recording of
evidence and not at the stage of rejection of plaint. Thus, the
High Court confirmed the order dated 16.09.2010 passed by the
trial court on the application filed by the defendant for rejection
of the plaint. The said order of the High Court in C.R.P. (MD)
No.1116/2011 is under challenge in this appeal.
2.8. Two more orders arising out of the same set of facts were
passed by the Madras High Court, Madurai Bench on the same
date as that of the impugned order. The issues in those matters
dealt with impleadment and beneficiary rights of the impleading
party with respect to the suit scheduled property. This Court
granted leave in those matters as well and had tagged them
with the present matter. However, since the present appeal deals
with an issue more germane to the suit and the relevance of
those two appeals rests on the fate of the present appeal, the
present appeal was de-tagged by this Court from the other two
connected matters vide order dated 24.10.2024.

Submissions:
3. We have heard Sri P.V. Balasubramaniam, learned senior advocate
for the appellant/defendant and learned senior advocate Sri V. Giri
for the respondent/plaintiff and perused the material on record.
3.1. Sri Balasubramaniam, at the outset submitted that both the High
Court as well as the trial court were not right in dismissing the
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application filed by the appellant/defendant in the suit under

Order VII Rule 11(d) of the Code. No doubt, the respondent/
plaintiff in the suit had the right to file another suit on the
same cause of action after rejection of the plaint in the earlier
unnumbered suit filed by it in the year 1993 for the relief of
specific performance of the agreement to sell dated 26.04.1991
on the strength of Order VII Rule 13 of the Code. However, the
said suit had to be on the same cause of action as the earlier
suit and within the period of limitation as prescribed under the
Limitation Act, 1963. Thus, the rejection of the plaint in the
earlier suit filed by the respondent/plaintiff was not a bar to file
a fresh suit on the same cause of action. The law provides for
another opportunity to a plaintiff to reagitate on an identical
cause of action despite the rejection of the plaint in the earlier
suit filed by a plaintiff on the basis of Order VII Rule 13 of the
Code. However, the second suit which is on the same cause
of action must be maintainable in law and not hit by Order VII
Rule 11(d) of the Code.
3.2. Elaborating on the aforesaid contention, learned senior counsel
submitted that in the instant case, the first suit was filed in the
year 1993 to seek specific performance of the agreement to
sell dated 26.04.1991 which suit was filed within the period
of limitation as prescribed under Article 54 of the Limitation
Act. The plaint of the said suit was rejected vide order dated
12.01.1998 owing to non-payment of the requisite court-fees
by the plaintiff. If another suit had to be filed by the very same
plaintiff on the very same cause of action, then the second
suit had to be within the prescribed period of limitation and
otherwise not barred by law. In the instant case, the respondent/
plaintiff filed the second suit only in the year 2007 for specific
performance of agreement to sell dated 26.04.1991, when the
cause of action accrued to the respondent/plaintiff in the year
1993 itself, i.e., when the earlier suit was filed. Even if the period
of the pendency of the said earlier suit till the rejection of the
plaint on 12.01.1998 is excluded for the purpose of computing
the limitation period which had commenced as early as in the
year 1993, there is no explanation as to why the second suit
i.e., O.S. No.49/2007 was filed only in the year 2007. At best,
the limitation period could have extended for a period of three
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years from 12.01.1998 for the filing of the second suit by the
respondent/plaintiff. That, the aforesaid facts are all admitted
by the respondent/plaintiff in the plaint itself and hence, on
that basis the trial court as well as the High Court ought to
have exercised their jurisdiction in rejecting the plaint in O.S.
No.49/2007 as the filing of the second suit in the year 2007 is
way beyond the prescribed period of limitation.
3.3. It was contended that when the earlier suit was filed by the
respondent/plaintiff, it was on the basis of the cause of action
that had accrued to the plaintiff. If the plaint in the earlier suit
was rejected on 12.01.1998, then the second suit ought to
have been filed immediately thereafter so as to maintain a
continuity in the cause of action or possibly within three years
from the date of the rejection of the plaint, which would mean
that the suit ought to have been filed by 12.01.2001. But, in the
instant case, the filing of the suit in the year 2007 gives rise
to an inference that the respondent/plaintiff had acquiesced to
the rejection of the plaint and thus had waived its right to seek
specific performance of the agreement to sell dated 26.04.1991.
Therefore, the filing of the second suit in the instant case is
only an afterthought, a chance and being speculative in nature,
ought to have resulted in rejection of the plaint on the basis of
Order VII Rule 11(d) of the Code as being hit by Article 54 of
the Limitation Act and therefore, barred in law.
3.4. It was therefore submitted that the plaint in O.S. No.49/2007
may be rejected by setting aside the impugned order and
allowing this appeal.
3.5. Per contra, learned senior counsel Sri Giri supported the
impugned orders rejecting the application filed by the appellant
herein under Order VII Rule 11(d) of the Code and contended that
there is no merit in this appeal. Elaborating on this submission,
Sri Giri contended that on the basis of Order VII Rule 13 of the
Code, the second suit, namely, O.S. No.49/2007 was filed. In
the plaint of the aforesaid suit, it has been categorically averred
that the letter dated 15.07.1991 which was executed by the
Secretary-cum-Treasurer Reverend, namely, A. Sundharam in
favour of the plaintiff clearly extended the period of limitation
owing to multiple litigations pending between the parties and the
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party seeking to implead in the said suit. Further, the question

of a suit being barred under Article 54 of the Limitation Act
is a mixed question of law and fact which cannot be decided
on mere averments made in the plaint. Hence, the trial court
as well the High Court rightly rejected the application filed by
the appellant herein for seeking rejection of the plaint. It was
contended that owing to the pendency of litigation between the
parties, the time for performance under the agreement dated
26.04.1991 was automatically extended and therefore, it was
only when the other litigation between the parties herein and
the impleading party in the suit concluded that the cause of
action for filing the second suit in the year 2007 resurfaced
as till then it was dormant and hence, there is no merit in this
appeal. It was contended that there was in fact no basis to
file the application under Order VII Rule 11(d) of the Code by
the appellant herein as the issue of limitation could have been
adjudicated upon on conclusion of the trial and along with the
other issues which arise in the suit. It was submitted that there
is no merit in this appeal and the same may be dismissed.
3.6. By way of reply, learned senior counsel for the appellant
contended that there is a contradiction in the submission of
the respondent/plaintiff inasmuch as when the earlier suit was
filed in the year 1993 it was on the basis of a cause of action
which had accrued to the plaintiff and there was no reference
to letter dated 15.07.1991 extending the time for performance
under the agreement or for that matter, resulting in extension of
time for the filing of the suit akin to Section 18 of the Limitation
Act. There is no reference to the letter dated 15.07.1991 in
the earlier suit filed by the respondent/plaintiff and the same
is also not admitted by the appellant herein. Even otherwise,
the pendency of other litigations vis-à-vis the suit scheduled
property could not have been a reason for filing the second suit
as late as in the year 2007 for seeking specific performance of
the agreement to sell dated 15.07.1991. On a comparison of
the earlier suit and the present suit and on a holistic reading
of the plaint in the second suit, the trial court as well as the
High Court ought to have allowed the application filed by the
appellant herein and rejected the plaint as being barred in law,
hit by the Limitation Act and thus, coming within the scope and
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Sri Bala & Co.

ambit of Order VII Rule 11(d) of the Code. Therefore, learned

senior counsel submitted that the present appeal may be
allowed with costs.

Points for Consideration:

4. The short issue before this Court in this appeal is, whether the plaint
in the subsequent suit for specific performance filed by the plaintiff,
i.e., O.S. No.49/2007, is liable to be rejected in terms of Order VII
Rule 11(d) of the Code on the ground that the said suit is barred by
the law of limitation. What order is to be passed?
5. The detailed narration of facts and contentions would not call for a
reiteration.
5.1. The undisputed facts of the case are that on 26.04.1991, the
appellant/defendant entered into an agreement to sell the
suit scheduled property to the respondent/plaintiff for a total
consideration of Rs.3,02,00,000/- (Rupees Three Crores and
Two Lakhs only) and an advance payment of Rs.10,00,000/-
(Rupees Ten Lakhs only) was made. There was a time schedule
for the payment of the balance in sale consideration within a
period of twenty-seven months from 26.04.1991 which is also
extracted in paragraph 4 of the plaint. Thus, within a period of
twenty-seven months from the date of the agreement, the entire
balance of sale consideration had to be paid by the respondent/
plaintiff to the appellant herein. However, as early as in 1993
itself, the suit for specific performance of the agreement to sell
was filed by the respondent/plaintiff, which was an unnumbered
suit, but the plaint in the said suit was rejected vide order dated
12.01.1998 passed by the trial court due to non-payment of the
requisite court fees by the respondent/plaintiff.
5.2. Thereafter, it was only in the year 2007 that the respondent/
plaintiff filed O.S. No.49/2007 seeking the very same relief of
specific performance of the sale agreement on receipt of the
balance sale consideration. This suit was filed on the strength
of Order VII Rule 13 of the Code. It is in this suit that the
appellant/defendant filed an application under Order VII Rule
11(d) of the Code on the ground that the said suit was barred
by the law of limitation since it was filed after a gross delay of
almost nine years from the date of rejection of the plaint in the
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earlier suit and the said suit not being maintainable as barred
in law. Consequently, the plaint was subject to rejection. The
trial court dismissed the application filed for seeking rejection
of the plaint by its order dated 16.09.2010 and the said order
has been sustained by the High Court by the impugned order.

Legal Framework:

Order VII Rule 11 of the Code:

6. Since the issue in this appeal pertains to the correctness or otherwise
of the impugned orders refusing rejection of the plaint, at this stage,
we deem it necessary to refer to Order VII Rule 11 of the Code which
deals with the grounds for rejection of a plaint:
“11. Rejection of plaint. - The plaint shall be rejected in
the following cases-
(a) where it does not disclose a cause of action;
(b) where the relief claimed is undervalued, and the
plaintiff, on being required by the Court to correct
the valuation within a time to be fixed by the Court,
fails to do so;
(c) where the relief claimed is properly valued, but the
plaint is written upon paper insufficiently stamped,
and the plaintiff, on being required by the Court to
supply the requisite stamp-paper within a time to be
fixed by the Court, fails to do so;
(d) where the suit appears from the statement in the
plaint to be barred by any law:
(e) where it is not filed in duplicate;
(f) where the plaintiff fails to comply with the provision
of rule 9:
Provided that the time fixed by the Court for the correction
of the valuation or supplying of the requisite stamp-paper
shall not be extended unless the Court, for reasons to
be recorded, is satisfied that the plaintiff was prevented
by any cause of an exceptional nature for correcting the
valuation or supplying the requisite stamp-paper, as the
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case may be, within the time fixed by the Court and that
refusal to extend such time would cause grave injustice
to the plaintiff.”
6.1. In the instant case, an application was filed under Order VII
Rule 11(d) of the Code where the ground of rejection of the
plaint was that the suit appears from the statement in the
plaint to be barred by any law. In this regard, our attention
was drawn to various decisions of this Court with regard to
rejection of plaint under Order VII Rule 11 of the Code which
are as follows:
(i) In T. Arivandandam vs. T.V. Satyapal (1977) 4 SCC
467, this Court while examining the aforesaid provision
has held that the trial court must remember that if on a
meaningful and not a formal reading of the plaint it is
manifestly vexatious and meritless in the sense of not
disclosing a clear right to sue, it should exercise the
power under Order VII Rule 11 of the Code taking care
to see that the ground mentioned therein is fulfilled. If
clever drafting has created the illusion of a cause of
action, it has to be nipped in the bud at the first hearing
by examining the party searchingly under Order X of the
Code, as observed by Krishna Iyer, J.
(ii) The object of the said provision was laid down by this
Court in Sopan Sukhdeo Sable vs. Assistant Charity
Commissioner (2004) 3 SCC 137. Similarly, in Popat
and Kotecha Property vs. State Bank of India Staff
Association (2005) 7 SCC 510, this Court has culled out
the legal ambit of Order VII Rule 11 of the Code.
(iii) It is trite law that not any particular plea has to be
considered, but the whole plaint has to be read. As was
observed by this Court in Roop Lal Sathi vs. Nachhattar
Singh Gill (1982) 3 SCC 487, only a part of the plaint
cannot be rejected and if no cause of action is disclosed, the
plaint as a whole must be rejected. Similarly, in Raptakos
Brett & Co. Ltd. vs. Ganesh Property (1998) 7 SCC
184, it was observed that the averments in the plaint as
a whole have to be seen to find out whether clause (d) of
Rule 11 Order VII of the Code is applicable.
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(iv) It was further held with reference to Order VII Rule 11

of the Code in Saleem Bhai vs. State of Maharashtra
(2003) 1 SCC 557 that the relevant facts which need to
be looked into for deciding an application thereunder are
the averments in the plaint. The trial court can exercise the
power at any stage of the suit i.e. before registering the
plaint or after issuing summons to the defendant at any
time before the conclusion of the trial. For the purposes of
deciding an application under clauses (a) and (d) of Order
VII Rule 11 of the Code, the averments in the plaint are
germane; the pleas taken by the defendant in the written
statement would be wholly irrelevant at that stage.
(v) In R.K. Roja vs. U.S. Rayudu (2016) 14 SCC 275, it was
reiterated that the only restriction is that the consideration of
the application for rejection should not be on the basis of the
allegations made by the defendant in his written statement
or on the basis of the allegations in the application for
rejection of the plaint. The court has to consider only the
plaint as a whole, and in case the entire plaint comes
under the situations covered by Order VII Rules 11(a) to
(f) of the Code, the same has to be rejected.
(vi) In Kuldeep Singh Pathania vs. Bikram Singh Jaryal
(2017) 5 SCC 345, this Court observed that the court can
only see whether the plaint, or rather the pleadings of the
plaintiff, constitute a cause of action. Pleadings in the sense
where, even after the stage of written statement, if there
is a replication filed, in a given situation the same also
can be looked into to see whether there is any admission
on the part of the plaintiff. In other words, under Order
VII Rule 11, the court has to take a decision looking at
the pleadings of the plaintiff only and not on the rebuttal
made by the defendant or any other materials produced
by the defendant.
(vii) In an application under Order VII Rule 11 of the Code,
a plaint cannot be rejected in part. This principle is well
established and has been continuously followed since
the 1936 decision in Maqsud Ahmad vs. Mathra Datt &
Co. AIR 1936 Lah 1021. This principle is also explained
in another decision of this Court in Sejal Glass Ltd. vs.
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Navilan Merchants Private Ltd. (2018) 11 SCC 780

which was again followed in Madhav Prasad Aggarwal
vs. Axis Bank Ltd. (2019) 7 SCC 158.
(viii) In Biswanath Banik vs. Sulanga Bose (2022) 7 SCC
731, this Court discussed the issue whether the suit can
be said to be barred by limitation or not, and observed
that at this stage, what is required to be considered is the
averments in the plaint. Only in a case where on the face
of it, it is seen that the suit is barred by limitation, then
and then only a plaint can be rejected under Order VII
Rule 11(d) of the Code on the ground of limitation. At this
stage what is required to be considered is the averments
in the plaint. For the aforesaid purpose, the Court has to
consider and read the averments in the plaint as a whole.

Order VII Rule 13 of the Code:

7. Order VII Rule 13 of the Code reads as under:
“13. Where rejection of plaint does not preclude
presentation of fresh plaint.- The rejection of the plaint
on any of the grounds hereinbefore mentioned shall not of
its own force preclude the plaintiff from presenting a fresh
plaint in respect of the same cause of action.”
7.1. This Court in Delhi Wakf Board vs. Jagdish Kumar Narang
(1997) 10 SCC 192 was dealing with a case where an earlier
suit had been rejected under Order VII Rule 11 of the Code in
the year 1984 and a fresh suit was instituted on the same cause
of action in the year 1986. The second suit was not allowed by
the trial court as well as by the High Court. This Court set aside
the orders of the trial court and the High Court and held that a
suit filed on the same cause of action subsequent to rejection
of the plaint in the previous suit under Rule 11 is not liable to
be dismissed on the ground of being barred by order rejecting
the plaint in the earlier suit.
7.2. In A. Nawab John vs. V.N. Subramaniyam (2012) 7 SCC 738,
this Court examined the applicability of Order VII Rule 11 of the
Code which requires a plaint to be rejected, inter alia, where
the relief claimed is undervalued and/or the plaint is written on
a paper insufficiently stamped, and, in either case, the plaintiff
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fails to either correct the valuation and/or pay the requisite

court fee by supplying the stamp paper within the time fixed
by the court. Rule 13 categorically declares that the rejection
of a plaint shall not of its own force preclude the plaintiff from
presenting a fresh plaint in respect of the same cause of action.
It was also observed that under Order VII Rule 11, a plaint,
which has not properly valued the relief claimed therein or is
insufficiently stamped, is liable to be rejected. However, under
Rule 13, such a rejection by itself does not preclude the plaintiff
from presenting a fresh plaint. It naturally follows that in a given
case where the plaint is rejected under Order VII Rule 11 of
the Code and the plaintiff chooses to present a fresh plaint,
necessarily the question arises whether such a fresh plaint is
within the period of limitation prescribed for the filing of the suit.
If it is to be found by the court that such a suit is barred by
limitation, once again it is required to be rejected under Order
VII Rule 11 clause (d).
7.3. However, Section 149 of the Code, as interpreted by this Court in
Mannan Lal vs. Mst. Chhotaka Bibi, (Dead) by LRs. (1970) 1
SCC 769, confers power on the court to accept the payment of
deficit court fee even beyond the period of limitation prescribed
for the filing of a suit, if the plaint is otherwise filed within the
period of limitation.
7.4. The case of Patil Automation Private Ltd. vs. Rakheja
Engineers Private Ltd. (2022) 10 SCC 1 further discussed
that under Order VII Rule 11 of the Code, the plaint can be
rejected on six grounds. They include failure to disclose the
cause of action, and where the suit appears from the statement
in the plaint to be barred. Order VII Rule 12 of the Code
provides that when a plaint is rejected, an order to that effect
with reasons must be recorded. Order VII Rule 13 provides
that rejection of the plaint mentioned in Order VII Rule 11
does not by itself preclude the plaintiff from presenting a fresh
plaint in respect of the same cause of action. Order VII of the
Code deals with various aspects about what is to be pleaded
in a plaint, the documents that should accompany and other
details. Order IV Rule 1 provides that a suit is instituted by
presentation of the plaint to the court or such officer as the
court appoints. By virtue of Order IV Rule 1(3), a plaint is to
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be deemed as duly instituted only when it complies with the

requirements under Order VI and Order VII. Order V Rule 1
declares that when a suit has been duly instituted, a summon
may be issued to the defendant to answer the claim on a date
specified therein. It was therefore held that rejection of earlier
suit under Order VII Rule 11 does not bar fresh suit on the
same cause of action provided the right of action is not barred
by the law of limitation.

Averments in the plaint:

8. Since the plaint has to be read holistically in order to ascertain whether
it is barred by limitation and consequently, to decide if the suit itself
is not maintainable, we now embark on a meaningful reading of
the plaint in O.S. No.49/2007 which is sought to be rejected by the
appellant herein, as under:
(i) Paragraphs 1 and 2 of the plaint give details of the plaintiff
and defendant.
(ii) In paragraph 3 of the plaint, it has been averred that there was a
written agreement of sale executed on 26th April, 1991 with regard
to the suit scheduled property by the defendant/vendor as the
absolute owner of the property with the plaintiff/purchaser. The
sale price mutually agreed upon was Rs.3,02,00,000/- (Rupees
Three Crores and Two Lakhs only) and an advance amount of
Rs.10,00,000/- (Rupees Ten Lakhs only) was paid earlier on
26th March, 1991, a month prior to the written agreement being
executed, wherein a payment of Rs.9,00,000/- (Rupees Nine
Lakhs only) was made by demand draft of Canara Bank dated
23.03.1991 payable at Nagerkoil and Rs.1,00,000/- (Rupees
One Lakh only) by way of an account payee cheque of City
Union Bank, Madras.
(iii) Paragraph 4 of the plaint gives the time schedule for receipt
balance sale consideration of Rs.2,92,00,000/- (Rupees Two
Crores ninety-two lakhs only) in the following manner:
“(a) Rs.10,00,000/-, (Rupees Ten lakhs only) to be paid within
3 months from the date this agreement subject to the
condition that the vacant possession of the properties
occupied by tenants are handed over to the plaintiff on
or before 1.6.1991.
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(b) Rs.20,00,000/- (Rupees Twenty lakhs) to be paid within

9 months from the date of the agreement.
(c) Rs.30,00,000/- (Rupees Thirty lakhs) to be paid within 9
months from the date of the agreement.
(d) Rs.30,00,000/- (Rupees Thirty lakhs) to be paid within 12
months from the date of the agreement.
(e) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 15
months from the date of the agreement.
(f) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 15
months from the date of the agreement.
(g) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 21
months from the date of the agreement.
(h) Rs.40,00,000/- (Rupees Forty lakhs) to be paid within 24
months from the date of the agreement..
(i) Rs.42,00,000/- (Rupees Forty two lakhs) paid within 27
Months from the date of the agreement. The true copy of
the sale deed is submitted herewith and it may be read
as part of the plaint allegations.”
(iv) Paragraph 5 of the plaint avers that the entire balance
consideration has to be paid within 27 months, i.e., before
25.07.1993 but time is not the essence of the contract. Further,
there is a condition precedent that the vacant possession of
the properties occupied by the tenant are to be handed over
to the plaintiffs on or before 01.06.1991.
(v) In paragraph 6 it is stated that the suit scheduled property
and the adjacent property are popularly known as Loch End
property wherein there are 15 buildings in an extent of 6.48
acres, out of which the defendant agreed to sell 5.05 acres
consisting of 12 buildings. That at the time of agreement the
tenant was in occupation of three buildings and on the date
of the agreement the plaintiff was put in possession of nine
buildings detailed therein.
(vi) Paragraph 7 of the plaint states that at the time of the
agreement to sell, one Rev. J. Isaac Moon was the President
of the defendant company and the Board of Directors by its
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Resolution/Proceedings, authorised the Secretary Treasurer

Rev. A. Sundharam to execute the agreement to sell and
the same was later ratified by the Board of Directors of the
defendant company.
(vii) Paragraphs 8 to 16, 18 and 20 of the plaint are extracted as
under:
“8. Rev. J. Isaac Moon for the reasons best known to him
did not like the suit property being sold to the plaintiff.
Therefore, he whipped up the religious sentiments. As
per the agreement to sell, the plaintiff was put in the
possession of the tenanted premises also on 1.7.1991
by the defendant. Bin Rev. J. Isaac Moon instigated the
tenant to proffer a false complaint against the personnel
of the defendant and the plaintiff and her husband before
the police as though the tenant was evicted by force
Therefore proceedings were initiated u/s 145 of the code
of Criminal Procedure in M.C. No. 1/1991 on the file of
the Sub-Divisional Magistrate-Cum-Revenue Divisional
Officer Kodaikanal.
9. The plaintiff was forced to file a suit for permanent injunction
against the tenant to protect possession in O.S.No.66 of
1991 on the file of the District Munsif Court Kodaikkanal
and obtained ad-interim orders in I.A.No.75/1991 also.
Again the tenant file a Writ petition before Hon’ble High
Court in W.P.No.9551/ 1991 seeing protection further
against the ad interim order in I.A.No.75/1991 the
tenant also filed Revision before Hon’ble High Court in
C.R.No.1846/1991 and obtained stay of operation of the
order. In the meantime, the Sub Divisional Magistrate-
cum-Revenue Divisional Office Kodaikanal on 9.12.1991
found possession only with the plaintiff and against which
also the tenant filed a Revision before the Hon’ble High
Court in Court in Crl. R.C. No.113/1992.
10. Since the defendant’s president Rev. J. Issac Moon,
without any authority was acting against the decisions /
resolutions / proceedings of the Board of Directors, the
defendant extended the time for performance of the contract
till the disposal of the all litigations on 15.07.1991. The true
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of copy, of the letter extending the time for performance

is also submitted herewith for better appreciation of facts.
11. In the meantime, the plaintiff also filed a suit with deficit
court fee for specific performance of the contract and the
same was allowed to be rejected for non-payment of dealt
court fee by the Hon’ble sub-court Palani. In the meantime
the tenant also filed several applications in O.P.No.
101/1975 in 1.A.No. 1500/92 and 1.A.No. 1501/92 on the
file of the District Court Dindigul questioning the validity of
the agreement to sell and also filed various suits in O.S.No
13/93 and in O.S.No. 108/93 on the file of the District Munsif
court Kodaikkanal for taking inventory and for permanent
injunction against the defendant from alienating the suit
property. In view of multiplicity of proceedings initiated by
the tenant, the plaintiff was advised not to proceed with the
suit for specific performance on the file of the Sub-Court
Palani at that time. It is needless to submit that under
order 7. Rule 13 of C.P.C. rejection of earlier plaint is not
a bar to the suit.
12. Subsequently the Hon’ble High Court passed a common
order setting aside the ad-interim orders passed in I.A.
No. 75/91 in O.S.No. 66/91 on the file of District Munsif
Court Kodaikanal and the order passed by SDK cum
RDO/ Kodaikkanal in MC 1/1991 in C.R.P, No. 1846/91
and Crl.R.C.No. 113/92 respectively, In view of the order
of the High court, the tenant with the help of police took
possession of not only the three tenanted premised but
also the other 9 buildings in the occupation of the plaintiff,
on 24.07.1997 with the help of Rev. Isaac Moon and the
local police.
13. The plaintiff preferred special Leave Petitions against the
orders of the Hon’ble High Court in W.P. No. 9551/1991,
C.R.P. No. 1846/1991 and Cri. R.C.No, 113/1992: The
Hon’ble Supreme Court in SI.O. (Crl) No.2037/97 (C) No.
2038/97 and 2039/97 set aside the order of the Hon’ble
High Court and remanded the same an 24.3.1998.
14. In the meantime, the tenant not pressed that suit in
O.S.No.13/93 and 108/96 on the file of the District:
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Munsif Court Kodaikkanal besides 1.A. No.1501/92 in

O.P.101/1975 on the file of the District Court Dindigul.
15. Again, SUM Cum RDO Kodailcanal found the tenant to
be in possession in M.C.No. 1/1991 after remand of the
matter by the Hon’ble Supreme court of India, without
hearing the plaintiff. Against which the plaintiff also
preferred a Revision before Hon’ble High Court in Crl.
R.C.No.511/1999. The Hon’ble High Court dismissed the
Revision and titt7-51aintiff has also preferred, a special
Leave Petition before Hon’ble supreme Court of India in
SLP.No.1239/2005 and the same is still, pending along
with other SLPs filed by the plaintiff arising out of orders
dated 29.04.2003 in CRP.No.232/2003 by the Hon’ble
High Court against the orders in I.A. No. 59/2002 in
O.S.No. 66/1991 on the file of the District Munsif Court
Kodaikanal and against the orders in CRP No.649/2003
which was filed against taking on file IA.55/2003 in O.S.
No.66 of 1991 on the file of the District Munsif Court
Kodaikkanal.
16. In the meantime, on 25.4.2003 the Hon’ble District Judge
Dindigul dismissed I.A.No. 1500/1992 in O.P.No. 101/1975
holding that the agreement to sell dated 26.4.1991
between the plaintiff and the defendant is valid and
enforceable. The tenant also filed a memo exonerating,
the plaintiff and the tenant even filed I.A.No. 1500/2012
to delete the name of the plaintiff from the decretal and
orders in I.A. No. 1500/1992 after its dismissal. The
Hon’ble District, Judge dismissed 1.A. No.1575/2005
on 5.4.2007.
xxx
18. Further, there were various litigations over the election
of conveners of three Synods, and board of Directors to
the defendant company froth July 1992. An advocate -
Commissioner was appointed by the Hon’ble High Court
to conduct election to the defendant company. Therefore,
the plaintiff could not negotiate or deal with the defendant
for enforcement of the contract for sale as there was
confusion in the part of the plaintiff filing this suit. Even
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not there is no clear picture as to the election of Directors

to the Board of the defendant company, and the secretary
of the company.
xxx
20. As for as the suit for permanent injunction in O.S. No. 66
of 1991 on the file of the District Munsif Court Kodaikkanal
now stands transferred to the file of the District Munsif
chuft Dindigul and the same is still pending in O.S. No.
76/2005.”
The aforesaid paragraphs refer to various proceedings initiated
in the years 1991, 1992, 1993 and give the details of those
proceedings, some of which had been disposed while other/s
were pending on the date of the filing of the plaint or suit.
(viii) Paragraph 17 of the plaint reads as under:
“17. In view of the cantankerous attitude of the tenant and
vexatious litigation of the tenant, the plaintiff could not file
the suit for specific performance of contract earlier. The
plaintiff was always ready and willing to perform her part
of the contract.”
(ix) Paragraphs 19 and 21 of the plaint are extracted as under
with regard to the filing of the suit for specific performance and
cause of action for the same.
“19. Any how, the plaintiff has not been advised to file this
suit for specific performance. The plaintiff has paid urban
land Tax to the tune of Rs.35,670/- and property Tax for
Rs.6652/-.for the suit property. Further, the suit property
had been attached for the Income Tax due to the govt.
by the plaintiff.
xxx
21. Cause of action for the suite arose on 26.4.1991 when the
plaintiff and the Defendant entered into an agreement of
sale with regard to the schedule mentioned property herein
under on 15.07.1991 when the time for performance of
contract is extended till the disposal of litigations launched
at the instance of the president of the company through
the tenant, on 25.4.2003 when the Hon’ble District Judge
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upheld the validity of the sale agreement dated 26.4.1991

and on 5.4.2007 when I.A.No.1515/2003 was dismissed to
delete the name of the plaintiff and at Kodaikanal Township
where the suit property situate within the jurisdiction of
this Hon’ble Court.”
8.1. What is significant to note is that in paragraphs 10 and 21,
there is a reference to a letter dated 15.07.1991 said to have
been issued by the defendant which is contended to be for
the purpose of extending the time for performance of the
contract till the disposal of litigation launched at the instance
of the President of the defendant through the tenant. Hence,
it is averred that the plaintiff was not advised to file the suit
for specific performance which was ultimately filed in the year
2007, being the second suit for the same cause of action, when
initially, (on the very same cause of action,) the unnumbered
suit was filed on 21.07.1993 wherein the plaint was rejected on
the ground that the court fee had not been tendered despite
several opportunities being given.
8.2. Further, in paragraph 17 of the plaint, it has been averred that
due to the cantankerous attitude and vexatious litigation of the
tenant, the plaintiff could not file the suit for specific performance
of the contract earlier, although the plaintiff was ready and willing
to perform her part of the contract. This averment is totally alien
to the filing of the second suit and has no bearing on the relief
sought inasmuch as the tenant is not a party to the agreement
dated 26.04.1991 and the filing and pendency of litigation vis-
à-vis the tenant was not an impediment at all to file the earlier
suit for specific performance of the aforesaid agreement.
8.3. We are conscious and mindful of the fact that while considering
the question of rejection of the plaint, it is the plaint alone
which has to be read meaningfully and not any averment
in the written statement. It is also necessary sometimes to
consider the documents annexed to the plaint for a holistic and
comprehensive reading of the plaint in order to decide whether
the plaint ought to be rejected or not. But the present case is not
a case where there is only one suit which has been filed by the
respondent/plaintiff on the same cause of action and therefore,
only a single plaint ought to be considered while deciding the
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issue of rejection of the plaint. This is a case where a second

suit has been filed after the rejection of the plaint in the earlier
suit filed on the very same cause of action and for the very
same relief of seeking specific performance of agreement to
sell dated 26.04.1991. In order to ascertain whether the plaint
in the second suit ought to be rejected on the ground that it is
barred by law such as the suit being filed beyond the prescribed
period of limitation and therefore, is barred within the meaning of
Order VII Rule 11(d) of the Code, we think it is useful to consider
the fact that an earlier suit was filed by the respondent/plaintiff
on the very same cause of action in the year 1993 itself which
resulted in the rejection of the plaint in the said suit owing to
non-payment of the court fee. This fact is pertinent when the
contention of the defendant/appellant herein is that the second
suit filed on the basis of Order VII Rule 13 of the Code is barred
as it has been filed beyond the prescribed period of limitation.
8.4. It is nobody’s case that the earlier suit was not filed in time. The
said suit was filed on 21.07.1993, on the basis of the cause of
action that arose for seeking the relief of specific performance
of the agreement to sell dated 26.04.1991. According to the
appellant/defendant, if the cause of action had occurred in the
year 1993 and therefore, the earlier suit was filed in time, without
any reference to the so-called letter dated 15.07.1991 (on the
basis of which extension of time for performance of the contract
is pleaded in the second suit), the rejection of the plaint in the
earlier suit, at best, could have extended the limitation period
by three years from the date of the rejection of the plaint in the
earlier suit so as to maintain a continuity in the cause of action
for filing the second suit. Significantly, in the earlier suit, the
plaintiff did not aver that time for performance of the contract had
been extended on the basis of the letter dated 15.07.1991 said
to have been issued by the defendant. In fact, the stand of the
respondent/plaintiff was to the contrary. It was to the effect that
in the absence of performance of the agreement to sell dated
26.04.1991 by the defendant, the plaintiff had a cause of action
to seek specific performance of the said agreement. Therefore,
the earlier suit was filed in July, 1993 itself on the basis that
the plaintiff had a cause of action to seek specific performance
of the agreement to sell dated 26.04.1991. But owing to non-
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payment of requisite court fee, the plaint in the said suit was
rejected on 12.01.1998. There was also no reference to any
of the litigations which were pending between the parties prior
to the filing of the earlier suit which is said to have resulted in
postponement of the performance of the contract.
8.5. Thus, if really, the cause of action had arisen for the plaintiff
to file the earlier suit on 01.07.1993 and the plaint in the said
suit was rejected on 12.01.1998 owing to non-payment of the
requisite court fee, then, at best, a second suit on the very
same cause of action could have been filed by 12.01.2001
which would have been within three years from the date of
rejection of the plaint in the earlier suit. Therefore, the second
suit, namely O.S. No.49/2007, could not have been filed in the
year 2007 i.e., nine years after the rejection of the plaint in the
earlier suit. The second suit not having been filed within a period
of three years from 12.01.1998, which could be construed to
be within the meaning of the Limitation Act, we are of the view
that the second suit filed by the respondent/plaintiff is barred
by the law of limitation and is thus not maintainable.
8.6. To get over this lacuna, the respondent/plaintiff has introduced
the so-called communication/letter dated 12.07.1991 said
to have been issued by the defendant by stating that time
for performance of the contract had been extended till the
conclusion of all other litigations between the parties herein
and with the tenant. If reliance is now placed on the said letter
by the respondent/plaintiff so as to seek a continuity in the
cause of action, then the earlier suit could not have been filed
at all in the year 1993 as then no cause of action had arisen
to the plaintiff to file the earlier suit! But the fact remains that
the plaintiff/respondent herein did file the earlier suit in the
year 1993 on the ground that they had a cause of action to do
so and for the very same relief of specific performance of the
agreement to sell dated 26.04.1991 was sought but the plaint
in the earlier suit came to be rejected owing to non-payment
of the requisite court fee. Even after the rejection of the plaint
in the earlier suit, steps were not taken on time, i.e., prior to
12.01.2001 to file the second suit on the basis of Order VII
Rule 13 of the Code. Instead, the second suit has been filed
only in the year 2007 belatedly and possibly only to keep the
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litigation alive between the parties which, in our view, is to

make an unlawful gain from the speculative second suit by a
settlement or in any other manner.
8.7. We do not appreciate the conduct of the respondent/plaintiff in
filing of the second suit belatedly in the year 2007 when they
could have done so prior to 12.01.2001, if they were really
serious in seeking enforcement of the agreement to sell dated
26.04.1991. We say so on the basis of the action of the plaintiff
in seeking the relief of specific performance of the agreement to
sell dated 26.04.1991 by filing the earlier suit in the year 1993
itself. In the said suit there was no reference to the letter dated
26.07.1991. Moreover, litigation concerning the suit scheduled
property was not an impediment to file the earlier suit in the year
1993. Then, we ask, how could it become an impediment for
postponing the filing of the second suit till the year 2007? We
think that the reliance placed on the letter dated 26.07.1991 in
the second suit filed in the year 2007 (and the glaring omission
of any reference to the said letter in the earlier plaint filed in
the year 1993) is mischievous and cannot be considered to
hold that there was an extension of time for performance of the
contract. Therefore, the second suit filed by the respondent in
the year 2007 is not within the prescribed period of limitation
and not as sought to be contended by the plaintiff.
8.8. Thus, on a holistic reading of the plaint it could be rejected
as being barred by law of limitation. However, it is stated that
normally the question of limitation would be a mixed question
of law and fact. Hence, usually, on a reading of the plaint it is
not rejected as being barred by the law of limitation. However,
the above is not an inflexible rule. We wish to discuss the
relevant Article under the Limitation Act applicable to the facts
of the present case which is Article 113 for the second suit with
a preface on the law of limitation.
9. The Limitation Act, 1963 consolidates and amends the law of limitation
of suits, appeals and applications and for purposes connected
therewith. The law of limitation is an adjective law containing procedural
rules and does not create any right in favour of any person, but simply
prescribes that the remedy can be exercised only up to a certain period
and not beyond. The Limitation Act therefore does not confer any
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substantive right, nor defines any right or cause of action. The law of
limitation is based on delay and laches. Unless there is a complete
cause of action, limitation cannot run and there cannot be a complete
cause of action unless there is a person who can sue and a person
who can be sued. There is also another important principle under
the Law of Limitation which is crystallized in the form of maxim that
“when once the time has begun to run, nothing stops it”.
9.1. In “Limitation Periods” by Andrew McGee, Barrister of Lincoln’s
Inn, published in 2002, the author says that, -
“Once time has begun to run it will run continuously,
except in certain situations. Time ceases to run when
the plaintiff commences legal proceedings in respect
of the cause of action in question. It is a general
principle of some importance that the bringing of an
action stops the running of time for the purposes of
that action only.”
9.2. It is further observed that the barring of the remedy under the
law of limitation on the expiry of the limitation period would not
imply plaintiff’s right being extinguished. Only the possibility
of obtaining a judicial remedy to enforce the right is taken
away. However, in certain cases, the expiry of the period of
limitation would extinguish the plaintiff’s right to seek remedy
entirely. Further, according to Andrew McGee, the policy and
justification for having a statute of limitation has been explained
in the following words:
“Policy issues arise in two major contexts. The
first concerns the justification for having statutes of
limitation at all and the particular limits that presently
exist. The second concerns the procedural rules
that apply after an action has been commenced.
Arguments with regard to the policy underlying
statutes of limitation fall into three main types. The
first relates to the position of the defendant. It is said
to be unfair that a defendant should have a claim
hanging over him for an indefinite period and it is
in this context that such enactments are sometimes
described as “statutes of peace”. The second looks
at the matter from a more objective point of view. It
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suggests that a time-limit is necessary because with

the lapse of time, proof of a claim becomes more
difficult-documentary evidence is likely to have been
destroyed and the memories of witnesses will fade.
The third relates to the conduct of the plaintiff, it being
thought right that a person who does not promptly
act to enforce his rights should lose them. All these
justifications have been considered by the courts.”
9.3. Further, to say that a suit is not governed by the law of
limitation runs foul of the Limitation Act. The statute of limitation
was intended to provide a time limit for all suits conceivable.
Section 3 of the Limitation Act provides that a suit, appeal or
application instituted after the prescribed “period of limitation”
must, subject to the provisions of Sections 4 to 24, be dismissed,
although limitation has not been set up as a defence. Section
2(j) defines the expression “period of limitation” to mean the
period of limitation prescribed in the Schedule for suit, appeal
or application. Section 2(j) also defines “prescribed period” to
mean the period of limitation computed in accordance with the
provisions of the Limitation Act. The court’s function on the
presentation of plaint is simply to examine, whether, on the
assumed facts, the plaintiff is within time. The court has to find
out when the “right to sue” accrued to the plaintiff.
9.4. Further, if a suit is not covered by any of the specific articles
prescribing a period of limitation, it must fall within the residuary
article. The purpose of the residuary article is to provide for
cases which could not be covered by any other provision in the
Limitation Act. The residuary article is applicable to every variety
of suits not otherwise provided for under the Limitation Act. It
prescribes a period of three years from the date when the “right
to sue” accrues. Under Article 120 of the erstwhile Limitation
Act, 1908, it was six years, which has been reduced to three
years under Article 113 of the present Act. According to the third
column in Article 113, time commences to run when the right
to sue accrues. The words “right to sue” ordinarily mean the
right to seek relief by means of legal proceedings. Generally,
the right to sue accrues only when the cause of action arises,
that is, the right to prosecute to obtain relief by legal means.
The suit must be instituted when the right asserted in the suit
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is infringed or when there is a clear and unequivocal threat to

infringe that right by the defendant against whom the suit is
instituted [State of Punjab vs. Gurdev Singh (1991) 4 SCC 1].
9.5. This Court in Shakti Bhog Food Industries Ltd. vs. Central
Bank of India (2020) 17 SCC 260, stated that the expression
used in Article 113 of the 1963 Act is “when the right to sue
accrues”, which is markedly distinct from the expression used
in other Articles in First Division of the Schedule dealing with
suits, which unambiguously refer to the happening of a specified
event. Whereas Article 113, being a residuary clause, does
not specify happening of particular event as such, but merely
refers to the accrual of cause of action on the basis of which
the right to sue would accrue.
9.6. Article 113 of the Limitation Act reads as under:
“PART X – SUITS FOR WHICH THERE IS NO PRESCRIBED
PERIOD

Description of suit Period of Time from

limitation which period
begins to run
113. Any suit for which no Three When the
period of limitation is years right to sue
provided elsewhere in accrues.”
the Schedule.
Article 113 of the Limitation Act is an omnibus Article providing
for a period of limitation not covered by any of the specific
Articles. No doubt, Article 54 of the Schedule to the Limitation
Act is the Article providing for a limitation period for filing a suit
for specific performance of a contract. For immediate reference,
the said Article is extracted as under:

Description Period of Time from which period

of suit limitation begins to run
For specific Three The date fixed for the
performance years. performance, or, if no
54.
of a such date is fixed, when
contract. the plaintiff has notice that
performance is refused.
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9.7. In the present case, the earlier suit was filed by the respondent/
plaintiff in July, 1993 on the basis of Article 54 referred to above
and the plaint in the said suit was rejected on 12.01.1998. The
second suit being O.S. No.49/2007 was filed on the strength of
Order VII Rule 13 of the Code for the very same cause of action
and for seeking the very same relief of specific performance
of the agreement dated 26.04.1991 as the plaint in the earlier
suit was rejected on 12.01.1998. Therefore, it cannot be said
that the second suit namely O.S. No.49/2007 was filed as per
Article 54 of the Limitation Act. Since this is a suit filed for the
second time after the rejection of the plaint in the earlier suit,
in our view, Article 54 of the Limitation Act does not apply to a
second suit filed for seeking specific performance of a contract.
Then, the question is, what is the limitation period for the filing
of O.S. No.49/2007. We have to fall back on Article 113 of the
Limitation Act.
9.8. Under Article 113 of the Limitation Act, time commences to run
when the right to sue accrues. This is in contradistinction to Article
54 of the Limitation Act relating to a suit for specific performance
of a contract which is on the happening of an event. No doubt,
the second suit which is the present suit filed by the respondent/
plaintiff is also for specific performance of the contract but the
right to sue accrued to file the second suit is on the basis of
Order VII Rule 13 of the Code subsequent to the rejection of
the plaint in the earlier suit on 12.01.1998. Therefore, the right
to sue by means of a fresh suit was only after 12.01.1998. The
expression “when the right to sue accrues” in Article 113 of the
Limitation Act need not always mean “when the right to sue first
accrues”. For the right to sue to accrue, the right sought to be
vindicated in the suit should have already come into existence
and there should be an infringement of it or at least a serious
threat to infringe the same vide M.V.S. Manikyala Rao vs. M.
Narasimhaswami, AIR 1966 SC 470. Thus, the right to sue
under Article 113 of the Limitation Act accrues when there is
an accrual of rights asserted in the suit and an unequivocal
threat by the defendant to infringe the right asserted by the
plaintiff in the suit. Thus, “right to sue” means the right to seek
relief by means of legal procedure when the person suing has
a substantive and exclusive right to the claim asserted by him
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and there is an invasion of it or a threat of invasion. When the

right to sue accrues, depends, to a large extent on the facts
and circumstances of a particular case keeping in view the relief
sought. It accrues only when a cause of action arises and for
a cause of action to arise, it must be clear that the averments
in the plaint, if found correct, should lead to a successful issue.
The use of the phrase “right to sue” is synonymous with the
phrase “cause of action” and would be in consonance when
one uses the word “arises” or “accrues” with it. In the instant
case, the right to sue first occurred in the year 1993 as the
respondent/plaintiff had filed the first suit then, which is on the
premise that it had a cause of action to do so. The said suit
was filed within the period of limitation as per Article 54 of the
Schedule to the Limitation Act.
9.9. Thus, generally speaking, the right to sue accrues only when
the cause of action arises, that is, the right to prosecute to
obtain relief by legal means. The suit must be instituted when
the right asserted in the suit is infringed or when there is a clear
and unequivocal threat to infringe that right by the defendant
against whom the suit is instituted. Article 113 of the Schedule
to the Limitation Act provides for a suit to be instituted within
three years from the date when the right to sue accrues and
not on the happening of an event as stated in Article 54 of the
Schedule to the Limitation Act.
9.10. In the facts and circumstances of the present case, it is also
necessary to apply Section 9 of the Limitation Act while applying
Article 113 thereto. Section 9 reads as under:
“9. Continuous running of time.—
Where once time has begun to run, no subsequent
disability or inability to institute a suit or make an
application stops it:

Provided that where letters of administration to the

estate of a creditor have been granted to his debtor,
the running of the period of limitation for a suit
to recover the debt shall be suspended while the
administration continues.”
574 [2025] 1 S.C.R.

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Section 9 is based on the general principle that when once

limitation has started to run, it will continue to do so unless it is
arrested by reason of any express statutory provision. Period of
limitation can be extended, inter alia, when cause of action was
cancelled such as by dismissal of a suit. Ordinarily, limitation
runs from the earliest time at which an action can be brought
and after it has commenced to run, there may be revival of a
right to sue where a previous satisfaction of a claim is nullified
with the result that the right to sue which has been suspended
is reanimated [Pioneer Bank Ltd vs. Ramdev Banerjee (1950)
54 Cal WN 710]. In that case, the court distinguished between
suspension and interruption of limitation period.
9.11. Once time has begun to run, it will run continuously but time
ceases to run when the plaintiff commences legal proceedings
in respect of the cause of action in question. It is a general
principle of some importance that bringing an action stops
running of time for the purpose of that action only [Andrew
McGee, Limitation Periods, 4th Edn., Sweet & Maxwell, chapter
2, para1]. The Indian law also follows the English law [James
Skinner vs. Kunwar Naunihal Singh ILR (1929) 51 All 367,
(PC)]. Intervention of court in proceedings would prevent the
period of limitation from running and date of courts’ final order
would be the date for start of limitation [N Narasimhiah vs.
State of Karnataka (1996) 3 SCC 88].
[Source: Tagore Law Lectures, U N Mitra, Law of Limitation
and Prescription, Sixteenth Edition, Volume 1, Sections
1-32 & Articles 1-52]
9.12. Applying the aforesaid dictum to the facts of the present case,
it is observed that the respondent/plaintiff had filed the suit for
specific performance of the agreement to sell dated 26.04.1991
in the year 1993 itself. The plaint in the said suit was rejected
on 12.01.1998. The plaintiff could have filed the second suit on
or before 12.01.2001 as it got right to file the suit on 12.01.1998
on the rejection of the plaint in the earlier suit filed by it. This
is on the basis of Order VII Rule 13 of the Code. However,
the limitation period expired in January, 2001 itself and the
second suit was filed belatedly in the year 2007. The cause of
action by then faded and paled into oblivion. The right to sue
[2025] 1 S.C.R.  575

Indian Evangelical Lutheran Church Trust Association v.

Sri Bala & Co.

stood extinguished. The suit was barred in law as being filed

beyond the prescribed period of limitation as per Article 113 to
the Schedule to the Limitation Act. Hence the second suit is
barred under Order VII Rule 11(d) of the Code. We therefore
have no hesitation in rejecting the plaint in O.S No.49/2007 filed
by the respondent herein even in the absence of any evidence
being recorded on the issue of limitation. This is on the admitted
facts. Thus, on the basis of Order VII Rule 11(d) of the Code
read with Article 113 of the Limitation Act by setting aside the
impugned orders of the High Court and the trial court and by
allowing the application filed under Order VII Rule 11(d) of the
Code. Consequently, this appeal is allowed.
Parties to bear their respective costs.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Ankit Gyan
 [2025] 1 S.C.R. 576 : 2025 INSC 44

Chief Revenue Controlling Officer Cum

Inspector General of Registration, & Ors.
v.
P. Babu
(Civil Appeal No(s). 75-76 of 2025)
03 January 2025
[J.B. Pardiwala and R. Mahadevan, JJ.]

Issue for Consideration

Matter referred by Joint Sub-Registrar to the Special Deputy
Collector (Stamps) for determining the correct market value of the
property. When both the authorities viz., the Registering Authority
and the Collector are vested with the discretion to decide the
market value of the property, by the expression ‘reason to believe’,
then whether it reflects the subjective satisfaction of the authorities
concerned or it reflects the objective determination of the market
value of the property; what is meant by ‘reason to believe’; when
the Registering Officer holds that the sale consideration in the
sale deed is not correct and the sale is undervalued, whether
it is obligatory for the Registering Authority to assign reason for
arriving at such conclusion before referring the sale deed to the
Collector; High Court whether justified in setting aside the order
of the authorities below w.r.t the stamp valuation.

Headnotes†
Stamp Act, 1899 – 47-A – Instruments of conveyance
etc., undervalued how to be dealt with Tamil Nadu Stamp
(Prevention of Undervaluation of Instruments) Rules, 1968 –
rr.3, 4, 6, 7 – Reference made by the Registering Authority
under Section 47A for determination of the market value of the
property in question without following the procedure – Market
value enhanced, additional stamp duty demanded – High
Court allowed the appeals filed by the respondent-purchaser
and set aside the orders passed by the authorities below –
Correctness:
Held: Impugned order is correct – The Registering Officer, after
registration of the document, can refer the same for adjudication
before the Collector, if he has reason to believe that there was
[2025] 1 S.C.R.  577

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

deliberate undervaluation of the property – Such a reference is

not a mechanical act, but the Registering Officer should have
a basis for coming to prima facie finding of undervaluation of
the property – Enquiry by the Registering Authority is a pre-
condition for making reference to the Collector for determination
of market value of the property – The determination of market
value without Notice of hearing to parties is liable to be set
aside – The expression ‘reason to believe’ is not synonymous
with subjective satisfaction of the officer – The belief must be
held in good faith, it cannot be merely a pretence – It is open to
the Court to examine the question whether the reasons for the
belief must have a rational connection or a relevant bearing to
the formation of the belief and are not irrelevant or extraneous to
the purpose of the section – The word ‘reason to believe’ means
some material on the basis of which the department can re-open
the proceedings – However, satisfaction is necessary in terms of
material available on record, which should be based on objective
satisfaction arrived at reasonably – Registering Officer cannot
undertake a roving enquiry for ascertaining the correct market
value of the property – If the Registering Officer is bona fide of
the view that the sale consideration shown in the sale deed is
not correct and the sale is undervalued, then it is obligatory on
the part of the Registering Authority as also the Special Deputy
Collector (Stamps) to assign some reason for arriving at such a
conclusion – If the document in question is straightway referred to
the Collector without recording any prima facie reason, the same
would vitiate the entire enquiry and the ultimate decision – In
the present case, the Form I notices prescribed under the Rules
did not contain any reason – Also, the Collector (Stamps) in his
order failed to indicate the basis on which the sale consideration
shown in the two sale deeds was undervalued – Furthermore,
the Collector is obligated to communicate the provisional order to
the parties concerned in respect of fixation of the correct value of
the property and also the duty payable in Form II – Form II was
issued however, after the issue of Form II, the parties have to be
given an opportunity to submit their representation in respect of
determining the market value of the subject property – Thereafter,
as contemplated in Rule 7 the Collector, after considering the
representation if received in writing and the submissions that might
have been urged at the time of hearing or even in the absence of
578 [2025] 1 S.C.R.

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any representation from the parties concerned, proceed to pass

the final order – However, the Collector (Stamps) directly issued
the final order without complying with sub-rules (2), (3) and (4)
respectively of Rule 4 and also without following Rule 6 – Appeals
dismissed. [Paras 18-21, 27, 31, 32, 34]
Words and Phrases – ‘reason to believe’ – Meaning – Discussed.

Case Law Cited

Mohali Club, Mohali v. State of Punjab, AIR 2011 P&H 23;
G. Karmegnam v. The Joint Sub-Registrar, Madurai, 2007 (5) CTC
737 – referred to.
Dawsons Ltd. v. Bonnin, 1922 (2) AC 413 – referred to.

List of Acts
Stamp Act, 1899; Tamil Nadu Stamp (Prevention of Undervaluation
of Instruments) Rules, 1968.

List of Keywords
Stamp valuation; Market value of the property; Joint Sub-
Registrar; Special Deputy Collector (Stamps); Registering Officer;
Registering Authority; Chief Revenue Controlling Officer-cum-the
Inspector General of Registration; Sale consideration; Sale deeds;
Mechanical act; Purchaser; Sale undervalued; Form I notices; Form
II; Enquiry; Pre-condition; Market value enhanced; Additional stamp
duty; Provisional order; Duty payable; Final order; determination
of market value; Notice of hearing; ‘reason to believe’; Subjective
satisfaction of the authorities; Objective determination.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 75-76 of 2025
From the Judgment and Order dated 02.09.2015 of the High Court
of Judicature at Madras in CMA No. 973 of 2010 and CMA No. 2534
of 2012

Appearances for Parties

Sabarish Subramanian, Vishnu Unnikrishnan, Danish Saifi,
Advs. for the Appellants.
Ms. Rohini Musa, Adv. for the Respondent.
[2025] 1 S.C.R.  579

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

Judgment / Order of the Supreme Court

Order

1. Leave granted.
2. These appeals are at the instance of the Chief Revenue Controlling
Officer-cum-the-Inspector General of Registration and two other
Revenue Officers, seeking to challenge the judgment and order
passed by the High Court of Judicature at Madras dated 2-9-2015 in
CMA Nos.973/2010 & 2534/2012 respectively by which the High Court
allowed the civil miscellaneous appeals filed by the respondent –
herein under Section 47-A(10) of the Indian Stamp Act, 1899 (for
short, “the Stamp Act”) and thereby quashed and set aside the order
passed by the Chief Revenue Controlling Officer-cum-the-Inspector
General of Registration with respect to the stamp valuation.
3. The subject matter of this litigation is the valuation shown in the
two Sale Deeds registered as DOC No.487/02 dated 5-9-2002 and
488/02 dated 2-9-2002 respectively.
4. The respondent – herein is the purchaser. He got the two sale deeds
executed through the original owner of the property in question. The
market value of the entire property covered in both the sale deeds
is Rs.1,20,000/- and Rs.1,30,000/- respectively. It appears that the
Joint Sub-Registrar, Tindivanam on receipt of the two registered sale
deeds declined to release the documents on the premise that the
sale consideration shown in the two sale deeds was under-valued.
5. The matter was accordingly referred by the Joint Sub-Registrar to
the Special Deputy Collector (Stamps) under Section 47-(A)(10) of
the Act for the purpose of determining the correct market value of
the property. It also issued notice in Form-I fixing the value of the
properties in DOC No.487/2002 at Rs.45,66,660/- and property in
DOC No.488/2002 at Rs.12,94,900/- respectively.
6. The Special Deputy Collector (Stamps) on conclusion of the
inquiry fixed the market value of the property covered under DOC
No.488/2002 at Rs.10,36,937/- and the property covered under DOC
No.487/2002 at Rs.51,16,600/-.
7. The respondent – herein being dissatisfied with the order passed by
the Special Deputy Collector (Stamps) preferred a statutory appeal
580 [2025] 1 S.C.R.

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before the Inspector General of Registration. The appeal came to

be dismissed.
8. In such circumstances, referred to above, the respondent – herein
went before the High Court by filing Civil Miscellaneous Appeals
under Section 47(A)(10) of the Stamp Act.
9. The High Court allowed both the appeals and thereby quashed and
set aside the orders passed by the authorities below.
10. The appellants feeling dissatisfied with the impugned judgment and
order passed by the High Court have come up before this Court with
the present appeals.
11. We have heard Mr. Sabarish Subramanian, the learned counsel
appearing for the appellants and Ms. Rohini Musa, the learned
counsel appearing for the respondent.
12. We take notice of the fact that the High Court while allowing the Civil
Miscellaneous Appeals has observed in paras 20 and 21 respectively
as under:-
“20. That being the legal position, if the contention raised
on the side of the learned counsel appearing for the
Appellant is appreciated in the legal proposition, as above
laid down by the Supreme Court, Full Bench, Division
Bench and Single Judges of our High Court, it would
compel this court to hold that the proceedings referring
the documents for determination of the market value,
without recording any reason to say that the document
is undervalued, thus without performing the statutory
obligation, cast upon the third Respondent Registering
Officer, to record such reasons to arrive at a decision
that the documents are undervalued and the same are
required to be referred to the authority concerned to
determine the actual market value of the property is
contrary to the procedure laid down under law and is ex
facie, illegal. Furthermore, no material is made available
to show that the third Respondent/ Registering Officer, on
the basis of such material, arrived at the conclusion that
the true value is not set forth in the documents. In the
absence of one such material, the proceedings initiated
under Sec.47A is legally unsustainable, as such, the
[2025] 1 S.C.R.  581

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

proceedings initiated for determination of the market value

and the out come of such proceedings, fixing the value of
the property covered under Doc Nos.487 and 488/2002
at Rs.498/- per sq.ft. and Rs.95/- per sq.ft respectively
and demanding additional stamp duty, on the basis of
such exorbitant value fixed, is hence arbitrary bad in law
and null and void.
21. In this case, the documents were registered on
05.09.2002, and 02.09.2002, whereas Form-I notice
was issued on 25.09.2002 and 12.09.2002 respectively.
However, Form-I notices did not reflect the reasons, for
which, the value mentioned in the documents was treated
as undervalued and the material based on which the value
mentioned in the documents was enhanced. Further, the
orders of the second Respondent Special Deputy Collector
(Stamps) dated 12.10.2004 did indicate the basis on which
the value mentioned in the documents in question was
enhanced. The reading of the same would reveal that his
valuation was ‘based on spot inspection and local enquiry.
But what was the manner of local enquiry and what was
the material collected in the course of such local enquiry
to arrive at higher valuation at Rs.400/- per sq.ft and 76/-
sq.ft. for the property covered in both the documents, and
made available before this court. It is stated in the orders
passed in respect of both the documents that the property
at Sakkarapuram was situated at 150 feet from Chengi Bus
stand and was on the north of the street leading to MP
Nagar. When the property covered in both the documents
is stated to be situated in the same village more or less
adjacently, how the value was fixed at Rs.40/- per sq.ft.
for one property and Rs. 76 /- per sq.ft. for other property
is remained unexplained in the orders passed by the
second Respondent. Further, the Appellant was not given
any notice either for spot inspection or for local enquiry
as contemplated under the relevant rules and their failure
to do so is contrary to the procedure laid down under law
and is in violation of the principles of natural justice.”
13. The High Court concluded by observing the following in para 23
which reads thus:-
582 [2025] 1 S.C.R.

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“23. Thus, the discussion held above would only reveal

that the determination of the market value of the property
in question is in pursuance of the reference made by the
third Respondent Registering Authority under Section 47A
of the Stamp Act, without following the procedure laid
down under the Act and without performing the statutory
obligation cast upon the third Respondent and the
impugned orders of the Respondents 1 and 2, in enhancing
the market value and demanding the additional stamp
duty, based enhancement, are without any basis and
based on irrelevant consideration and assumption and
presumption and without application of mind. Further, as
onus to prove that the instrument was undervalued, is on
the department and the same has not been satisfactorily
discharged by the Respondents, the impugned orders of
the Respondents are liable to be set aside.”
14. Thus what weighed with the High Court is the fact that the Form I
notices failed to assign any reasons as to why the documents could
be said to be undervalued. In other words, what was the basis for
the Special Deputy Collector (Stamps) to say that sale consideration
shown in the two sale deeds was not correct. According to the High
Court, there was no basis or any relevant materials on record to take
the view that the two documents were undervalued except the spot
inquiry and local inspection.
15. The only contention raised by the learned counsel appearing for the
appellants is that it is not mandatory to assign reasons in the notice
issued in Form I.
16. Section 17 of the Stamp Act reads as under:-
“17. Instruments executed in India. – All instruments
chargeable with duty and executed by any person in India
shall be stamped before or at the time of execution.”
17. Section 47-A of the Stamp Act reads thus:-
“47-A. Instruments of conveyance etc., undervalued how
to be dealt with.— (1) If the Registering Officer appointed
under the Indian Registration Act, 1908 (Central Act XVI
of 1908) while registering any instrument of conveyance,
exchange, gift, release of benami right or settlement, has
[2025] 1 S.C.R.  583

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

reason to believe that the market value of the property

which is the subject matter of conveyance, exchange, gift,
release of benami right or settlement, has not been truly
set forth in the instrument, he may, after registering such
instrument, refer the same to the Collector for determination
of the market value of such property and the proper duty
payable thereon.
(2) On receipt of a reference under sub-section (1), the
Collector shall, after giving the parties a reasonable
opportunity of being heard and after holding an enquiry in
such manner as may be prescribed by rules made under
this Act, determine the market value of the property which
is the subject matter of conveyance, exchange, gift, release
of benami right or settlement and the duty as aforesaid. The
difference, if any, in the amount of duty, shall be payable
by the person liable to pay the duty.
(3) The Collector may, suo motu or otherwise, within
five years from the date of registration of any instrument
of conveyance, exchange, gift, release of benami right
or settlement not already referred to him under sub-
section (1), call for and examine the instrument for the
purpose of satisfying himself as to the correctness of the
market value of the property which is the subject matter
of conveyance, exchange, gift, release of benami right or
settlement and the duty payable thereon and if after such
examination, he has reason to believe that the market
value of the property has not been truly set forth in the
instrument, he may determine the market value of such
property and the duty as aforesaid in accordance with the
procedure provided for in sub-Section (2). The difference, if
any in the amount of duty, shall be payable by the person
liable to pay the duty.”
18. Under Section 47-A(1) and under Section 47-A(3), if the Registering
Authority has reason to believe that the instrument of conveyance
did not reflect the correct market value of the property, then the
Registering Authority has the power to refer the same to the Collector
for determination of market value of the property and the Collector, on
reference, under Section 47-A(1), may determine the market value of
584 [2025] 1 S.C.R.

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such property in accordance with the procedure prescribed. Enquiry

by the Registering Authority is a pre-condition for making reference
to the Collector for determination of market value of the property. The
determination of market value without Notice of hearing to parties
is liable to be set aside. When the Registering Authority finds that
the value set forth in an instrument was less than the minimum
value determined in accordance with the Rules, in that event, the
Registering Authority is empowered to refer the instrument to the
Collector for determination of market value of such property and the
Stamp Duty payable thereon.
19. When both the authorities viz., the Registering Authority and the
Collector are vested with the discretion to decide regarding the
market value of the property, by the expression ‘reason to believe’,
then whether it reflects the subjective satisfaction of the authorities
concerned or it reflects the objective determination of the market
value of the property? What is meant by ‘reason to believe’ is the
issue to be considered.
20. Availability of material is the foundation or the basis, for any authority
to arrive at any decision whatsoever. The basis of a thing is that on
which it stands, and on the failure of which it falls and when a document
consisting partly of statements of fact and partly of undertakings for
the future is made the basis of a contract of insurance, this must mean
that the document is to be the very foundation of the contract, so that
if the statements of fact are untrue, or the promissory statements are
not carried out, the risk does not attach. This has been interpreted
in the case of Dawsons Ltd. v. Bonnin, 1922 (2) AC 413.
21. It has been rightly held in the case of Mohali Club, Mohali v. State of
Punjab, reported in AIR 2011 P&H 23, that the Registering Officer,
after registration of the document, can refer the same for adjudication
before the Collector, if he has reason to believe that there was
deliberate undervaluation of the property. Such a reference is not a
mechanical act, but the Registering Officer should have a basis for
coming to prima facie finding of undervaluation of the property. Duty
is enjoined upon the Registering Officer to ensure that Section 47-
A(1) does not work as an engine of oppression nor as a matter of
routine, mechanically, without application of mind as to the existence
of any material or reason to believe the fraudulent intention to evade
payment of proper Stamp Duty. The expression ‘reason to believe’
[2025] 1 S.C.R.  585

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

is not synonymous with subjective satisfaction of the officer. The

belief must be held in good faith, it cannot be merely a pretence. It
is open to the Court to examine the question whether the reasons
for the belief must have a rational connection or a relevant bearing
to the formation of the belief and are not irrelevant or extraneous
to the purpose of the section. The word ‘reason to believe’ means
some material on the basis of which the department can re-open the
proceedings. However, satisfaction is necessary in terms of material
available on record, which should be based on objective satisfaction
arrived at reasonably.
22. Rule 3 of the Tamil Nadu Stamp (Prevention of Undervaluation of
Instruments) Rules, 1968 (for short, “the Rules 1968”) is as under:-
“3. Furnishing of statement of market value.-
(1) x x x x x
(4) The registering officer may also look into the “Guidelines
Register” containing the value of properties supplied to
them for the purpose of verifying the market value.
Explanation : The “Guidelines Register” supplied to the
officers is intended merely to assist them to ascertain prima
facie, whether the market value has been truly set forth in
the instruments. The entries made therein regarding the
value of properties cannot be a substitute for market price.
Such entries will not foreclose the enquiry of the Collector
under Section 47-A of the Act or fetter the discretion of
the authorities concerned to satisfy themselves on the
reasonableness or otherwise of the value expressed in
the documents.”
23. Form 1 of notice prescribed under the Rules 1968 reads thus:-
“Form I [See rule 4] Form of notice prescribed under rule
4 of the Tamil Nadu Stamp (Prevention of Under valuation
of Instruments) Rules, 1968 To, Please take notice that
under sub-section (1) of section 47-A of the Indian Stamp
Act, 1899 (Central Act II of 1899), a reference has been
received from the registering officer for determination of the
market value of the properties covered by an instrument
of conveyance/ exchange/gift/release of benami right/
settlement registered as document No ......... dated the
586 [2025] 1 S.C.R.

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........... and the duty payable on the above instrument.

A copy of the reference is annexed. 2. You are hereby
required to submit your representation, if any, in writing
to the undersigned within 21 days from the date of
service of this notice to show that the market value of
the properties has been truly and correctly set forth in the
instrument. You may also produce all evidence in support
of your representations within the time allowed. 3. If no
representations are received within the time allowed,
the matter will be disposed of on the basis of the facts
available.”
24. Form 2 of notice prescribed under the Rules 1968 reads thus:-
“Form II [See rule 6] Form of notice prescribed under rule
6 of the Tamil Nadu Stamp (Prevention of Undervaluation
of Instruments) Rules, 1968 To, Please take notice that
in the matter of the reference under sub-section (1) of
section 47-A of the Indian Stamp Act, 1899 (Central Act
II of 1899) relating to the determination of the market
value of the properties covered by an instrument of
conveyance/exchange/gift ¹[release of benami right/
settlement] registered as document No ......... dated ...........
received from the registering officer. I have passed an
order provisionally determining the market value of the
properties and the duty payable on the instrument. A copy
of the order passed in the matter is annexed. Footnote:
1. The above expression was inserted by G.O. Ms. No.
1317, CT & RE, dt. 27.11.1982.
2. The matter relating to the final determination of the
market value of the properties and the duty payable on
the instrument will be taken up for hearing on the (date)
... camp .... at ........ a.m/p.m. You are hereby required
to lodge before the undersigned before the date of the
hearing, your objections and representations, if any, in
writing as*to why the market value of the properties and
the duty as provisionally determined by me, should not be
confirmed to adduce oral or documentary evidence and
be present at the hearing. If you fail to avail yourself of
this opportunity of appearing before the undersigned or
[2025] 1 S.C.R.  587

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

adducing such evidence, as is necessary, producing the

relevant documents, no further opportunity will be given
and the matter will be disposed of on the basis of the
facts available.”
25. It appears that the High Court followed its Full Bench decision in
G. Karmegnam v. The Joint Sub-Registrar, Madurai reported in
2007 (5) CTC 737 and other Division Bench decisions on the point
in question more particularly the contention that Form I must contain
some reasons for saying that the document is undervalued.
26. In the Full Bench decision, the High Court held as follows:-
“7. Registration of document is a sine qua non for referring
the matter to the Collector, if the Registering Officer believes
that the property is undervalued. No jurisdiction has been
conferred on the Registering Officer to refuse registration,
even if the document is undervalued. Besides, there is no
authority for him to call upon the person concerned to pay
additional stamp duty. Collector is the prescribed authority
to determine the market value, after affording a reasonable
opportunity of hearing the parties. The Registering Officer
cannot make a roving enquiry to ascertain the correct
market value of the property by examining the parties.
However, it is expected that he has to give reasons for
his conclusion for undervaluation, however short they
may be. He can neither delay nor refuse registration of
the instrument, merely because the document does not
reflect the real market value of the property. In order to
reach a conclusion, there is no bar for the Registering
Officer to gather information from other sources, including
official or public record. Valuation guidelines, prepared
by the revenue officials periodically, are intended with an
avowed object of assisting the Registering Officer to find
out prima facie, whether the market value set out in the
instrument has been set forth correctly.
x x x x x

26. When the Collector exercises powers under sub-

sections (2) and (3), he shall be deemed to be a quasi-
judicial authority, as the detailed procedure prescribed in
the relevant rules evidently portrays that the Collector’s
588 [2025] 1 S.C.R.

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decision is relatable and verifiable by the materials on

evidence, which he beings into record, on making an
enquiry after hearing the parties concerned. The Collector
has been conferred with such powers by the statute,
whereas the Registering Authority is not. The powers of
the Registering Officer are remarkably limited i.e. to say,
he cannot at all hold any enquiry to ascertain the quantum
of Stamp Duty payable on an instrument. As adverted
to supra, he shall not undertake a detailed enquiry by
examining the parties, which powers are exercisable by
the Collector alone. The relevant rules would indicate that
the procedures have to be adopted for an enquiry by the
Collector. A detailed procedure has been formulated in
Rule (4) for the Collector to act on receipt of reference
under Section 47-A in Tamil Nadu Stamp (Prevention of
Undervaluation of Instrument) Rules, 1968. It does not
lay down any procedure as to what are the duties to be
performed by a Registering Officer, while ascertaining
the market value of the property. The necessary upshot
would be, the legislature thought it appropriate to curtail
the powers of the Registering Officer, probably for the
reason that allowing the Registering Officer to make a
roving enquiry would lead to loss of time for registration,
resulting in accumulation of documents for registration
with him. Further, prescribing an authority for the special
purpose of conducting enquiry is very much essential, who
shall not be the Registering Authority.”
27. We are in complete agreement with the view taken by the Full Bench
of the High Court. It is not permissible for the Registering Officer to
undertake a roving enquiry for the purpose of ascertaining the correct
market value of the property. If the Registering Officer is bona fide
of the view that the sale consideration shown in the sale deed is not
correct and the sale is undervalued, then it is obligatory on the part
of the Registering Authority as well as the Special Deputy Collector
(Stamps) to assign some reason for arriving at such a conclusion.
In such circumstances, if the document in question is straightway
referred to the Collector without recording any prima facie reason,
the same would vitiate the entire enquiry and the ultimate decision. In
the case on hand, it is not in dispute that the Form I notices did not
[2025] 1 S.C.R.  589

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

contain any reason. It also appears that the Collector (Stamps) in his
order also failed to indicate the basis on which the sale consideration
shown in the two sale deeds was undervalued.
28. There is one more aspect of the matter which we should look into.
The High Court in its impugned judgment while recording the facts
in para 2 stated as under:-
“…The third Respondent, having refused to release the
documents on the ground that it was undervalued, referred
the same to the second Respondent Special Deputy
Collector (Stamps), Cuddalore under section 47(A)(1)
of the Act for determining the correct market value of
the property and also issued notice in Form I, thereby
fixing the value of the property in Doc.No. 487/2002 at
Rs.45,66,660/- and the other property in Doc.No.488/2002
at Rs.12,94,900/-. Thereafter, the second Respondent also
issued Form II notice to the parties to the documents for
enquiry before him. The Appellant, who is the purchaser
of the property filed his objections. After enquiry, the
second Respondent Special Deputy Collector (Stamps) in
his proceedings dated 12.10.2004 fixed the market value
of the property covered under Doc no.487/2002 at Rs.
51,16,565 @ Rs.51,16,600/- (Rs.400/- per sq.ft for 9170/-
sq.ft + building at Rs.14,48,565/-) and fixed the market
value of the property covered under Doc.no.488/2002
at Rs.10,36,937/- @ Rs.10,37,000/- (Rs.76/- per sq.ft
for 13,577 sq.ft + Well and laying stone at Rs.5,085/-)
and accordingly demanded deficit stamp duty payable
for the documents. Aggrieved against the same, the
purchaser who is the Appellant herein, preferred further
appeals before the first Respondent Inspector General
of Registration, who by the impugned orders dated
27.01.2009, determined the value of the property covered
in Doc No.487/2002 at Rs.498 /- per sq.ft for land and the
property covered in Doc No.488/2002 at Rs.95/- per sq.ft.
for land and Rs.15,96,999 /- for building.…”
29. It appears from the aforesaid that the second respondent i.e. the
Special Deputy Collector (Stamps) failed to pass any provisional
590 [2025] 1 S.C.R.

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order as contemplated in Rule 4(4) of the Rules 1968. Rule 4(4) of

the Rules 1968 reads as follows:-
“4. Procedure On Receipt Of Reference Under Section
47-A:-
x x x x x

(4) After considering the representations, if any, received

from the person to whom notice under sub-rule (1)
has been issued, and after examining the records and
evidence before him, the Collector shall pass an order in
writing provisionally determining the market value of the
properties and the duty payable. The basis on which the
provisional market value was arrived at shall be clearly
indicated in the order.”
30. As per Rule 6 of the Rules 1968, after passing the provisional order,
it is obligatory on the part of the Collector to communicate the market
value of the property and the duty payable by the parties concerned
in Form II. On receipt of the Form II as contemplated under Rule 7
of the Rules 1968, the Collector shall have to pass the final order.
It appears that in the case on hand, without following the Rules 4
and 6 respectively, the Collector (Stamps) directly passed the final
order under Rule 7 of the Rules 1968.
31. The scheme of the Stamp Act and the relevant rules makes it
abundantly clear that the Collector is obligated to communicate the
provisional order to the parties concerned in respect of fixation of the
correct value of the property and also the duty payable in Form II.
In the case on hand, Form II was issued. To that extent, there is no
dispute. However, after the issue of Form II, the parties concerned
have to be given an opportunity to submit their representation in
respect of determining the market value of the subject property.
Thereafter, as contemplated in Rule 7 of the Rules 1968, the Collector,
after considering the representation if received in writing and the
submissions that might have been urged at the time of hearing or
even in the absence of any representation from the parties concerned,
proceed to pass the final order. It appears from the material on
record that in the case on hand, the Collector (Stamps) directly
issued the final order without complying with sub-rules (2), (3) and
[2025] 1 S.C.R.  591

Chief Revenue Controlling Officer Cum Inspector General

of Registration, & Ors. v. P. Babu

(4) respectively of Rule 4 and also without following Rule 6 of the

Rules 1968. This could be said to be in violation of the Rules 4 and
6 respectively of the Rules 1968.
32. We are of the view that no error not to speak of any error of law
could be said to have been committed by the High Court in passing
the impugned order.
33. In the result, these appeals fail and are hereby dismissed.
34. Pending applications, if any, also stand disposed of.

Result of the case: Appeals dismissed.

†
Headnotes prepared by: Divya Pandey
 [2025] 1 S.C.R. 592 : 2025 INSC 93

Sadashiv Dhondiram Patil

v.
The State of Maharashtra
(Criminal Appeal No. 1718 of 2017)
09 January 2025
[J.B. Pardiwala and R. Mahadevan, JJ]

Issue for Consideration

Issue arose whether Village Police Patil is a Police Officer in terms
of s. 25 of the Evidence Act; and whether the High Court erred in
holding the appellant guilty of the offence of murder.

Headnotes†
Evidence Act, 1872 – ss.25, 106 – Extra judicial confession –
Admissibility – Extra judicial confession to Police Patil,
if admissible – Appellant-husband charged for the murder
of his wife – Extra judicial confession allegedly made by the
appellant to the village Police Patil – Trial court acquitted
the accused for the offence punishable u/ss.302 and 201
IPC holding that extra judicial confession allegedly made by
the appellant to Village Police Patil was inadmissible as per
s.25 – High Court set aside the acquittal and held the appellant
guilty of the offence of murder – Correctness:
Held: Police Patil of the Village cannot be termed as a Police
Officer for the purpose of s.25 – Extra-judicial confession alleged
to have been made by the accused before village Police Patil is
admissible in evidence and is not hit by s.25 – However, such
extra-judicial confession should be found to be true and trustworthy
before it is relied upon by the Court to hold the accused guilty –
Extra-judicial confession should also be found to be free of any
inducement, coercion etc. and should be shown to have been
made by the accused on his own free will and volition – What
is alleged to have been conveyed cannot be said to be an
extra- judicial confession – Very omnibus and vague statement
seems to have been made – High Court erred in relying upon
the extra-judicial confession even while rightly holding that the
[2025] 1 S.C.R.  593

Sadashiv Dhondiram Patil v. The State of Maharashtra

same was admissible in evidence as Village Police Patil cannot

be said to be a Police Officer – Panch witnesses did not support
the prosecution case – Just because the panch witnesses have
turned hostile does not mean that such discovery should be
disbelieved – However, I.O. cannot be said to be proving the
contents of the panchnama in accordance with law and the
circumstance of discovery cannot be relied upon – Motive cannot
be the sole basis for convicting the accused – Prosecution has to
prove its case beyond reasonable doubt – Initial burden of proof
is always on the prosecution – However, in cases where husband
is alleged to have killed his wife in the night hours and that too
within the residential house, then undoubtedly the husband has
to offer some explanation as to what had actually happened and
if he fails to offer any plausible explanation, this can go against
him – Prosecution has to first lay the foundational facts before
it seeks to invoke s.106 – It cannot straightaway invoke s.106
and throw the entire burden on the accused to establish his
innocence – In view thereof, the High Court erred in holding the
appellant guilty of the offence of murder – Impugned judgment
set aside – Penal Code, 1860 – ss.302, 201. [Paras 27, 31,
36-38, 42, 47-49, 50-51, 55, 56, 58]

Case Law Cited

Rajeshwer S/o Hiraman Mohurle v. State of Maharashtra (2009)
Criminal Law Journal 3816; C.K. Ravindra v. the State of Kerala
[1999] Supp. 5 SCR 140 : AIR 2000 SC 369; Ram Singh v. the
State of Maharashtra & Anr (1999) Criminal Law Journal 3763;
Balwinder Singh v. State of Punjab (1995) Supplementary 4 SCC
259 – referred to.

List of Acts
Evidence Act, 1872; Penal Code, 1860; Code of Criminal Procedure,
1973; Maharashtra Village Police Act, 1967.

List of Keywords
Extra judicial confession; Admissibility of extra judicial confession
to Police Patil; Police Patil, if termed as a Police Officer; Panch
witnesses; Motive.
594 [2025] 1 S.C.R.

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Case Arising From

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
1718 of 2017
From the Judgment and Order dated 03.07.2015 of the High Court
of Judicature at Bombay in CRLA No. 70 of 1994

Appearances for Parties

Sachin Patil, Geo Joseph, Risvi Muhammed, Rishabh Agarwal,
Advs. for the Appellant.
Aniruddha Joshi, Sr. Adv., Siddharth Dharmadhikari, Aaditya
Aniruddha Pande, Advs. for the Respondent.

Judgment / Order of the Supreme Court

Order

1. This appeal arises from the Judgment and Order passed by the
High Court of Judicature at Bombay dated 3-7-2015 in Criminal
Appeal No.70/94 by which the High Court allowed the acquittal
appeal filed by the State of Maharashtra and thereby set aside
the Judgment of the Additional Sessions Judge, Kolhapur dated
13-7-1993 in Sessions Case No.48/91 acquitting the appellant -
herein (original accused) for the offence punishable under
Sections 302 and 201 respectively of the Indian Penal Code (for
short, the “IPC”).
2. The case of the prosecution may be summarized as under:-
The deceased by name Lata was married to the appellant herein.
A son was born in the wedlock. However, it appears that marital life
was not happy. The appellant – herein was entertaining a doubt in
his mind as regards the chastity of his wife. One day all of a sudden,
the deceased went missing.
3. In such circumstances, the maternal uncle of the deceased by name –
Yashwant Ganpati Patil (PW 5) went to the house of Village Police
Patial by name Mr. Vasant Dattu Bhosale & informed him that his
niece had gone missing.
4. It appears that on 20-10-1990 at about 9.30 p.m. PW 5 brought to
the notice to PW 2 that his niece Lata was missing.
[2025] 1 S.C.R.  595

Sadashiv Dhondiram Patil v. The State of Maharashtra

5. The PW – 2, being the Village Police Patil, visited the house of the
appellant – herein and found that the dead-body of the deceased
lying in one corner of the house. The materials on record further
indicate that the brother of the appellant – herein by name Madhukar
and his wife Laxmi (PW 4) along with their daughter Mangal (PW 3)
were also residing in the same house but separately in one part.
6. Upon recovery of the dead-body of the deceased, the inquest
panchnama was drawn. The body of the deceased was sent for
postmortem examination. The postmortem examination report noted
that the cause of death was asphyxia due to strangulation. It is the
case of the prosecution that the appellant – herein strangulated his
wife to death with the help of an iron rod.
7. This iron rod is also stated to have been discovered from the place
of the incident itself by way of a discovery panchnama drawn by the
Investigating Officer in the presence of the panch witnesses.
8. The appellant was arrested in connection with the First Information
Report that came to be lodged by the PW-2 himself at the concerned
Police Station for the offence of murder.
9. Upon completion of investigation, the Investigating Officer filed
charge-sheet for the offence enumerated above.
10. The case being exclusively triable by a Sessions Judge came to be
committed to the Court of Sessions.
11. The Trial Court framed charge vide order dated 20.02.1993 which
reads thus:
“CHARGE
I, V. B. Deshmukh, 4th Additional Sessions Judge, Kolhapur
hereby charge you accused.
Shri. Sadashiv Dhondiram Patil, Age-33 years, Resident
of Takali, Tal. Shirol, Dist. Kolhapur as follows:-
That you accused on or about 25.10.1990 at about 1.00
a.m. at Mouje Sainik Takali, Tal. Shirol, Dist. Kolhapur
did commit murder of your wife Sou. Lata Sadashiv Patil,
Age-25 years by pressing her neck and thereby committed
an offence punishable section 302 of the Indian Penal
Code.
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Secondly that you on aforesaid date, time and place

knowingly that certain offence, to wit that you committed
murder of your wife by pressing her neck and offence
punishable with death or imprisonment for life has been
committed, did cause of certain evidence of the said
offence to disappear to wit. that you put the dead body of
your wife in a gunny bag and thrown in the (iso) where the
food-grains are preserved with an intention to screening
yourself from legal punishment and thereby committed an
offence punishable under section 201 of the Indian Penal
code, and within my cognizance.
And, hereby I direct you that you be tried by me on
aforesaid charges.
Today this 20th day of February, 1993 at Kolhapur.
(V.B.Deshmukh),
4th Additional Sessions Judge,
Kolhapur..”
12. In the course of the trial, the prosecution examined the following
witnesses:-
1. Mr. Yeshvant Govind Chavan Exhibit 13
2. Mr. Vasant Dattu Bhosale (Patil) Exhibit 16
3. Ms. Mangal Exhibit 19
4. Ms. Laxmi wife of Madhukar Patil Exhibit 20
5. Mr. Yashvant Ganapati Patil Exhibit 21
6. Mr. Yamnappa Bhimrao Murali Exhibit 22
7. Mr. Amrut Rama Mane Exhibit 24
8. Dr. Shashikant Lakshman Pawar Exhibit 32
13. The prosecution also relied upon the following pieces of documentary
evidence:-
1. First Information Report (Exhibit 17)
2. Inquest Panchnama (Exhibit 8)
[2025] 1 S.C.R.  597

Sadashiv Dhondiram Patil v. The State of Maharashtra

3. Spot Panchnama (Exhibit 10)

4. Arrest Panchnama (Exhibit 11)
5. Memorandum of the Statement of accused
(Exhibit 14)
6. Seizure punchnama of iron-rod, Article No.1
(Exhibit 15)
7. Seizure punchnama of the clothes of the deceased
(Exhibit 12)
8. The Memorandum of Post-mortem examination
(Exhibit 33)
9. Advance Medical Certificate (Exhibit 9)
10. Seven photographs (Exhibit 37 to 43)
14. Upon closure of the recording of the evidence, the further statement
of the appellant – herein was recorded under Section 313 of the
Code of Criminal Procedure, 1973
15. In the further statement, the appellant stated as under:-
Q.75 Do you want to say anything more about your
defence?
Answer : I am giving written statement.
WRITTEN STATEMENT OF THE ACCUSED
UNDER SECTION 313 of Cr. P.C.
Few months prior to death of my wife, I became disciple
of Shri Rane of Shirol. He told me not to sleep at home
for 6 months. Therefore I use to stay at night generally at
Shirol. If I am at Takali, then I use to sleep at Kalleshwar
temple. 2-3 days prior to missing of my wife from the
home, I was at Shirol. When I returned on Thursday or
Friday, I came to know about missing of my wife from the
home. I enquired with, her maternal uncle, but she did not
go there. I am implicated in the present case only on the
basis of doubt.
16. The Trial Court upon appreciation of the oral as well as the
documentary evidence on record came to the conclusion that the
598 [2025] 1 S.C.R.

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prosecution had failed to prove its case beyond reasonable doubt.

The Trial Court accordingly acquitted the appellant – herein.
17. It may not be out of place to state that at this stage that the Trial
Court looked into only one piece of circumstance, i.e., the extra
judicial confession alleged to have been made by the appellant –
herein before the (PW 2), i.e., the village Police Patil in the presence
of his sister-in-law (PW 4) – Laxmi.
18. It is also important to note that Madhukar (brother of the accused)
passed away during the course of trial and he could not have been
examined as one of the prosecution witnesses.
19. The Trial Court took the view that the extra-judicial confession alleged
to have been by the appellant – herein before (PW 2) could not be
said to be admissible in evidence being hit by Section 25 of the
Indian Evidence Act.
20. The Trial Court also disbelieved the discovery of the iron rod under
Section 27 of the Indian Evidence Act.
21. The State, being dissatisfied with the Judgment and Order of acquittal
passed by the Trial Court, went in appeal before the High Court.
22. The High Court reversed the acquittal and held the appellant – herein
guilty of the offence of murder and accordingly sentenced him to
undergo life imprisonment.
23. In such circumstances, referred to above, the appellant is here before
this Court with the present appeal.
24. We have heard Mr. Sachin Patil, the learned counsel appearing for
the appellant and Mr. Aniruddha Joshi, the learned Senior counsel
appearing for the respondent – State.
25. We take notice of the fact that the entire case hinges on circumstantial
evidence. The High Court relied upon the four pieces of incriminating
evidence for the purpose of holding the accused guilty of the offence
of murder of his wife:-
(i) extra-judicial confession alleged to have been made by the
appellant before (PW 2) on 29-10-1990
(ii) discovery of the weapon of offence, i.e., the iron rod;
(iii) motive to commit crime;
[2025] 1 S.C.R.  599

Sadashiv Dhondiram Patil v. The State of Maharashtra

(iv) the incident occurred inside the house and, therefore, the
appellant could be said to be within the special knowledge as
to what had happened on the fateful day of the incident.
26. The High Court while reversing the acquittal invoked Section 106
of the Evidence Act and shifted the burden on the appellant –
herein to establish or rather explain what exactly had happened
with his wife.
27. It appears that when the Trial Court acquitted the appellant – herein,
the position of law as regards the admissibility of an extra-judicial
confession said to have been made before the Village Police Patil
was something different. A Division Bench of the High Court in
“Ram Singh vs. the State of Maharashtra & Anr” (1999) Criminal
Law Journal 3763 had held that a village Police Patil is a Police
officer and, therefore, any confession made to him is inadmissible
in evidence in view of Section 25 of the Evidence Act.
28. In the said Judgment, the Division Bench also looked into & discussed
Section 14 of the Maharashtra Village Police Act, 1967, under which
a Police Patil is appointed.
29. We quote the relevant observations of the said Judgment as under:-
13. Section 14 of the Maharashtra Village Police Act, 1967,
provides inter alia:
“(1) The Police Patil shall apprehend any person within
the limits of his village who he may have reason to believe
has committed any serious offence, and shall forward
such person, together with all articles likely to be useful
as evidence, to the Station Officer.
(2) Every person so apprehended shall within 24 hours
be produced before the nearest Magistrate, excluding the
time necessary for the journey from the place where he is
apprehended to the Court of the Magistrate.”
14. Sub-section (1) of S. 13 of the Maharashtra Village
Police Act, 1967, provides:
“The Police Patil shall forthwith proceed to the place of incident
and call upon two or more intelligent persons belonging
to the village or neighbourhood, who shall investigate the
causes of death and all the circumstances of the case, and
600 [2025] 1 S.C.R.

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make a written report of the same, which the Police Patil

shall cause to be forthwith delivered to the Station Officer.”
15. Section 15 of the Maharashtra Village Police Act, 1967,
provides inter alia:
“(1) The Police Patil, in making any investigation coming
within the scope of his duty, shall have authority to call
and examine witnesses, and record their statement, and
to search for concealed articles, taking care that no search
be made in a dwelling-house between sunset and sunrise
without urgent occasion.
(2) The Police Patil shall also have authority, in carrying out
any search or any pursuit of supposed criminal, to enter
and act within the limits of other villages, being bound
however to have immediate information to the Police
Patil thereof, who shall afford him all the assistance in his
power, and be immediately responsible for continuing the
search and pursuit.”
16. On plain reading of these provisions under the
Maharashtra Village Police Act, 1967, it will be clear that
the Police Patil has power to apprehend a person, if he
suspects that a person has committed serious offence. He
has to send report to the Police Station and the person
is required to be produced within 24 hours from the time
and Police Patil apprehend such person. Not only that a
preliminary investigation with respect to such crime also
can be made by the Police Patil and he can even chase the
accused and apprehend the accused. So, it is obvious that
the observations of the learned Additional Sessions Judge
quoted above are made without reading the appropriate
provisions. Before making any such observations in the
judgment, the Judge, at least, of the cadre of Additional
Sessions Judge, is expected to go through the relevant
provisions of law. Sweeping observations should not be
made just to boost the reasoning which is being given in
the judgment.
17. In the light of the provisions of the Maharashtra Village
Police Act, 1967, it has to be seen whether any confession
made before the Police Patil is hit by Section 25 of the
[2025] 1 S.C.R.  601

Sadashiv Dhondiram Patil v. The State of Maharashtra

Evidence Act. The powers of the Police Patil which are

referred to above clearly indicate that when any offence
takes place, he can act as a Police Officer. He is not a
mere spectator or informant. So, for all practical purposes,
he is a Police Officer and, therefore, any confession made
before the Police Patil would become inadmissible in
evidence as being made before a Police Officer.
18. In this respect, we would like to refer two rulings of our
High Court. The first is, in the case of Queen Empress v.
Bhima ((1894) ILR 17 Bom 485), and the other is in the case
of Vistari Narayan Shebe v. The State of Maharashtra 1978
Cri LJ 891. It is observed in the case of Vistari Narayan
Shebe by the Division Bench, as follows (at page 895):
“In our opinion, it is fairly well established that the police
patil is a police officer within the meaning of Sec. 25 of
the Evidence Act. As early as in 1893 this Court held in
Queen Empress v. Bhima ((1894) ILR 17 Bom 485), that
a police patil is a police officer within the meaning of Ss.
25 and 26 of the Indian Evidence Act. A confession made
to a police patil is inadmissible in evidence. It must be
remembered that the words “a police officer” found in S. 25
of the Indian Evidence Act should not be read in any strict
technical sense but according to its more comprehensive
and more popular meaning. Nor is the term confined to
a person actually in charge of investigating the offence
under the Cr. P.С.”
19. Thus, it will be very clear that any confessional
statement made by the accused before the Police Patil is not
admissible in evidence. If the learned Additional Sessions
Judge had considered this aspect in that perspective, he
would not have relied upon the evidence of the Police
Patil to hold that the extra judicial confession made by
the accused before the Police Patil could be sufficient to
convict the accused. The deposition of the Police Patil as
well as the F.I.R. which include this confessional statement
are inadmissible in evidence and, therefore, this evidence
brought on record by the prosecution has to be excluded
altogether”.
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30. In the year 2009, a Full Bench of the Bombay High Court, answered
a reference titled “Rajeshwer S/o Hiraman Mohurle vs. State of
Maharashtra” reported in (2009) Criminal Law Journal 3816. The
Full Bench was called upon to answer whether a Village Police Patil
is a Police Officer within the meaning of Section 25 of the Evidence
Act or not.
31. The Full Bench of the High Court overruled the above referred Division
Bench Judgment and took the view that a Village Police Patil is not
a Police Officer within the meaning of Section 25 of the Evidence
Act and any confession made before him would be admissible in
evidence as an extra-judicial confession. We may quote the relevant
paragraphs of the said Full-Bench Judgment as under:-
“18. Upon objective analysis of the principles aforestated,
it can be stated with some certainty that merely because a
person is appointed to a post which vests him with limited
powers of Investigation and inquiry or any power ancillary
thereto or empowers him to prevent commission of crime
in an area would not per se make him a Police Officer in
law so as to attract the bar contained in section 25 of the
Evidence Act. We have already noticed in some detail
that the powers vested in Police Patil under the Village
Police Act are expected to be exercised for performance
of duties and functions stated under section 6 of that Act.
The duties and functions of the Police Patil are of a very
restricted nature and do not vest in him all the powers
including the power to file a charge-sheet under section 173
of the Criminal Procedure Code which a Police Officer
under the Code possess. On the contrary, he is expected
to assist the Police Officers when called upon by them
in performance of their duties. He has to act under the
orders of the District Magistrate and even is expected to
collect and communicate to the Station Officer intelligence
affecting the public peace. The basic and primary distinction
between the powers of the Police Officer under the Code
and the power and duties of the Police Patil under the
Village Police Act, is that while the investigating officer or
Police Officer in charge of a Police Station is duty bound
in, law to conduct inquiry or, investigation in a just, proper
and fair manner independently being uninfluenced by
[2025] 1 S.C.R.  603

Sadashiv Dhondiram Patil v. The State of Maharashtra

any other facts. There the restricted duties and powers

relating to investigation and even otherwise vested in the
Police Patil are to be exercised under the supervision of
higher authorities as indicated in the provisions of the
Village Police Act. Police Patil is required to perform his
functions and discharge his duties subject to the orders
of the Magistrate and is also required to assist and help
the Police Officers in discharge of their duties. In these
circumstances, it will be a far fetched submission that
the Police Patil has to be treated as a Police Officer in
law for all intent and purposes. The consistent view of
the Supreme Court as is evident from the above referred
judgments is that the officer, other than a police officer,
invested with powers of an officer -In-charge of a Police
Station is not entitled, to exercise all the powers under
Chapter XII of the Code Including the power to submit a
report or charge-sheet/challan under section 173 of the
Code. This feature has been the hallmark and is held to
be determinative factor by the Supreme Court. Once this
aspect is missing from the ambit of the powers vested in
the officer, he cannot be stated to be a Police Officer for
the purposes of section 25 of the Indian Evidence Act.
The Police Patil under the Village Police Act is also not a
Police Officer on the deeming fiction of law as there is no
provision in the Statute which specifically or even otherwise
requires the Police Patil to be treated as a Police Officer
for all intent and purpose.
19. It will be useful to refer to the reasoning recorded
by the Supreme Court in the case of Badku Joti Savant
(supra) even at the cost of repetition. In paragraph 9 while
discussing section 21 of the Central Excise Act which
states that a Central Excise Officer under the Act has all
the powers of an officer in-charge of a Police Station under
Chapter XIV of the Criminal Procedure Code, the Court
rejected the contention that therefore he should be deemed
to be a Police Officer within the meaning of section 25 of
the Evidence Act. Reference was made to the provisions
of section 78(3) of the Bihar and Orissa Excise Act, 1955
and section 77 of that Act which stated that Excise Officer
empowered under the provisions shall be deemed to be
604 [2025] 1 S.C.R.

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the officer in-charge of a Police Station and shall have the

power of such officer to investigate a cognizable case. But
even there the Supreme Court held that this power does
not include the power to submit a charge-sheet under
section 173 of the Criminal Procedure Code under the
Excise Act unlike the Bihar and Orissa Act and thus held
that Central Excise Officer is not an officer deemed to be
in-charge of a Police Station. In other words, the Supreme
Court declined to accept the applicability of the deemed
fiction of law to the extent of terming the Central Excise
Officer as a Police Officer for the purpose of section 25
of the Evidence Act.
20. The distinction between the powers of investigation
given to a Police Officer under the Code and that of a
Police Patil under the Village Police Act is quite obvious
from the provisions of the two Statutes. Police Patil has
been vested with very limited powers that too under the
control and for the benefit of the Executive Magistrate/
Police Officer and his duties are primarily to ensure that
offences and public nuisance are not committed in the
village and to bring the offenders to justice. The expression
“bringing the offenders to justice” appearing in section 6 of
the Village Police Act along with its other provisions has to
be given its normal and plain meaning. There is no need,
keeping in view the scheme of the Act or the legislative
intent, to expand the meaning of this expression and
enlarge the scope of provisions of this section on certain
presumption of law. The powers of the Police Patil as stated
under section 13 to 15 of the Village Police Act, are to
be read and construed ejusdem generis to the provisions
of section 6. The bare reading of these provisions show
that Police Patil is not vested with the powers of preparing
and filing a charge-sheet before the Court of competent
jurisdiction. The powers of Police Patil to investigate and
control over the apprehended persons are very limited in
contradistinction to powers of a Police Officer under the
Code. In terms of section 156 of the Code, a Police Officer
is vested with the power to investigate any cognizable case
under the provisions of Chapter XIII even without orders
of the Magistrate. On the other hand, when a Police Patil
[2025] 1 S.C.R.  605

Sadashiv Dhondiram Patil v. The State of Maharashtra

apprehends a person in exercise of his powers vested

under section 14(i) of the Village Police Act, he has to
forward such person to the Station Officer, who in turn shall
produce such person before the Magistrate within twenty
four hours. Thus Legislative intent behind section 6 appears
to be that Police Patil is a person responsible primarily
for village surveillance, prevention of crime and providing
his assistance and help to the police in discharge of his
duties. Even above all this, his duties and functions have
been made subject to orders of the District Magistrate. The
Police Patil does not enjoy absolute freedom in relation
to investigation, apprehending the suspect and even in
exercise of other powers vested in him under law. The
powers to be exercised and duties and functions to be
performed by him are under the supervisory control of the
stated authorities. The duties, functions and powers vested
in an authority by a Statute are relatable to the source
which prescribes such functions and powers. The ambit,
scope and effect of exercise of such power can be tested
by two different concepts i.e. quo modo and actio quaelibet
it suia via. In what manner the powers are to be exercised
as per the prescribed procedure, the performance or action
must follow its prescribed procedure. On applying the
above stated principles and testing them with reference to
the maxims stated (supra), it is not possible for the Court
to hold that either the manner of functions and powers of
Police Patil or method in which they are to be performed
are equitable to the authority, powers and functions of a
Police Officer, in law. Therefore, we are unable to contribute
to the view that Police Patil is a Police Officer in law for
all intent and purpose and confession before him would
attract the bar contemplated under section 25 of the Indian
Evidence Act, 1872.
21. In view of our above discussion, now we proceed to
record the answer to the question of law framed by the
Division Bench. Our answer is as follows:-
“We are of the considered view that the Police Patil
appointed under the Maharashtra Village Police Act, 1967
is not a ‘Police Officer’ for the purposes of section 25 of
the Indian Evidence Act, 1872”.
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32. It appears that the High Court while reversing the acquittal relied upon
the above-referred Full Bench Decision for the purpose of taking the
view that the extra-judicial confession made by the appellant – herein
before PW 2 could be said to be admissible in evidence.
33. One interesting question that arises for our consideration at this
stage is that at the relevant point of time i.e., in 1993 when the Trial
Court acquitted the appellant – herein the position of law was that an
extra-judicial confession said to have been made by an accused
before a village Police Patil could be said to be inadmissible in
evidence being hit by Section 25 of the Evidence Act.
34. In the year 2009, the Full Bench of the Bombay High Court while
answering a reference held that a Village Police Patil is not a Police
Officer. Therefore, if the accused herein had stood acquitted having
regard to the position of law prevailing at the relevant point of time
then relying on a subsequent decision taking a contrary view whether
the accused could have been held guilty?
35. It could be argued that the Full Bench decision of the Bombay High
Court came to be delivered in the year 2009 whereas the appellant
was acquitted by the Trial Court sometime in the year 1993. The
position of law till 2009 was that a Village Police is a Police Officer
and therefore, any confession made to him would be inadmissible in
evidence in view of Section 25 of the Evidence Act, more particularly
in view of the Division Bench decision of the Bombay High Court
rendered in Ram Singh (supra). We do not propose to consider the
question whether the High Court could have relied upon the Full Bench
decision after the appellant came to be acquitted by the Trial Court
in 1993 thereby giving retrospective effect as regards its applicability.
36. We proceed on the footing that PW 2 – Vasant Dattu Bhosale,
Police Patil of the Village cannot be termed as a Police Officer for
the purpose of Section 25 of the Evidence Act. We also proceed on
the footing that the extra-judicial confession alleged to have been
made by the accused before PW 2 is admissible in evidence and
is not hit by Section 25 of the Evidence Act. However, such extra-
judicial confession should be found to be true & trustworthy before
it is relied upon by the Court to hold the accused guilty.
37. Besides, the above such extra-judicial confession should also be
found to be free of any inducement, coercion etc. and it should be
shown to have been made by the accused on his own free will and
volition.
[2025] 1 S.C.R.  607

Sadashiv Dhondiram Patil v. The State of Maharashtra

38. We requested the learned counsel appearing for the State to show
us from the oral evidence on record, more particularly, the deposition
of PW 2 as well as the deposition of PW 5, the exact words alleged
to have been uttered by the appellant – herein in the form of an
extra-judicial confession.
39. We on our own also looked into and are convinced that what is
alleged to have been conveyed cannot be said to be an extra-judicial
confession. A very omnibus & vague statement seems to have been
made as deposed by both the witnesses in their oral evidence.
40. This Court in “C.K. Ravindra vs. the State of Kerala” AIR 2000 SC
369 had held that before placing reliance upon the extra-judicial
confession, the Court must be convinced as regards the exact words
or even the words as nearly as possible. This Court took the view
that it would be difficult to rely upon the extra-judicial confession if
the exact words or even the words as nearly as possible have not
been reproduced, the said statement cannot be said to be voluntary.
In such circumstances, the same may have to be excluded from the
purview of consideration.
41. This Court in “Balwinder Singh vs. State of Punjab” (1995)
Supplementary 4 SCC 259 had held that an extra-judicial confession
by its very nature is rather a weak type of evidence and requires
appreciation with a great deal of care and caution. Where extra-
judicial confession is surrounded by suspicious circumstances, its
credibility becomes doubtful and would lose its importance.
42. In such circumstances, referred to above, we are of the view that the
High Court fell in error in relying upon the extra-judicial confession
even while rightly holding that the same was admissible in evidence
as Village Police Patil cannot be said to be a Police Officer.
43. We now come to the second piece of the circumstance relied upon.
44. It is the case of the prosecution that after the arrest of the appellant –
herein, he is said to have on his own free will and volition made a
statement before the Investigating Officer and he was ready and
willing to point out the place where he had concealed the weapon,
i.e., the iron rod.
45. Accordingly, the Investigating Officer along with two independent
witnesses in the form of panchas went to the place as led by the
appellant – herein.
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46. The place was the house itself where the incident had occurred.
According to the Investigating Officer, the appellant pointed out the
iron rod which was lying in one corner of the house. The same was
seized in the presence of the panch witnsses and was sent to the
Forensic Science Laboratory for chemical analysis.
47. In this regard, we may only say that panch witnesses have not
supported the case of the prosecution. They failed to prove the
contents of the discovery panchnama.
48. If the panch witnesses are declared hostile then the prosecution
is obliged to prove the contents of the said discovery panchnama
through the evidence of the Investigating Officer. The question is
how is the I.O. expected to prove the contents of the panchnama.
49. The position of law in this regard is very clear. Just because the panch
witnesses have turned hostile does not mean that such discovery
should be disbelieved. From the plain reading of the oral evidence
of the Investigating Officer if the discovery is believable and inspires
confidence, the same can definitely be looked into as one of the
incriminating pieces of evidence against the accused.
50. However, unfortunately in the case on hand, all that the I.O. did
was to depose that he had drawn the panchnama and in the end
identified his signature on the same and that of the panch witnesses.
This cannot be said to be proving the contents of the panchnama
in accordance with law. In such circumstances, the circumstance of
discovery also cannot be relied upon.
51. We are now left with motive. Motive is a double-edged weapon.
Motive cannot be the sole basis for convicting the accused and that
too for a serious offence like murder. Motive may be considered along
with other pieces of reliable evidence in the form of incriminating
circumstances.
52. We now come to the last part of the matter.
53. The learned counsel appearing for the State submitted that the
dead body of the deceased was recovered from the house itself,
i.e., the place where the family was residing. He would submit that
in normal circumstances, the husband could be said to be the best
person to explain as to what had happened to his wife on the date
of the incident.
[2025] 1 S.C.R.  609

Sadashiv Dhondiram Patil v. The State of Maharashtra

54. According to the learned counsel, when an offence is committed

within the four walls of the house and that too in secrecy, it is difficult
for the prosecution to establish its case beyond reasonable doubt
and, therefore, under Section 106 of the Evidence Act, it is for the
accused to explain what had actually happened and in the absence
of any such explanation, it could be said that the accused committed
the crime as alleged.
55. The law in the aforesaid regard is well-settled. Prosecution has to
prove its case beyond reasonable doubt & that too on its own legs.
The initial burden of proof is always on the prosecution. However, in
cases where husband is alleged to have killed his wife in the night
hours & that too within the residential house, then undoubtedly the
husband has to offer some explanation as to what had actually
happened and if he fails to offer any plausible explanation, this
can go against him. However, Section 106 of the Evidence Act is
subject to one well-settled principle of law. The prosecution has to
first lay the foundational facts before it seeks to invoke Section 106
of the Evidence Act. If the prosecution has not been able to lay the
foundational facts for the purpose of invoking Section 106 of the
Evidence Act, it cannot starightaway invoke the said Section and
throw the entire burden on the accused to establish his innocence.
56. In the overall view of the matter, we are convinced that the High
Court committed error in holding the appellant guilty of the offence
of murder.
57. In the result, this appeal succeeds and is hereby allowed.
58. The impugned Judgment and Order passed by the High Court is
hereby set aside.
59. We are informed that the appellant has been enlarged on bail by
this Court. His bail bonds stand discharged.

Result of the case: Appeal allowed.

†
Headnotes prepared by: Nidhi Jain
 [2025] 1 S.C.R. 610 : 2025 INSC 54

NBCC (India) Ltd.

v.
The State of West Bengal & Ors.
(Civil Appeal No. 3705 of 2024)
10 January 2025
[Pamidighantam Sri Narasimha* and
Pankaj Mithal, JJ.]

Issue for Consideration

Whether an MSME cannot make a reference to the Facilitation
Council for dispute resolution under Section 18 of the Micro,
Small and Medium Enterprises Development Act, 2006 if it is not
registered under Section 8 of the 2006 Act before the execution
of the contract with the buyer.

Headnotes†
Micro, Small and Medium Enterprises Development Act, 2006 –
s.18 – MSME seeks to refer the dispute that it has with the
buyer regarding payment of its dues to the Facilitation Council
for arbitration u/s. 18 of the Act – The appellant opposes this
prayer by contending that ‘any party’ can only be a ‘supplier’
and that supplier should have been registered u/s. 8 of the
Act even before execution of the contract, if not, the reference
is impermissible:
Held: After examining the text, context, and purpose of the
Act, this Court arrives at the decision that s.18 is not restrictive
and is a remedy for the resolution of disputes, and as such, it
is kept open-ended to enable ‘any party’ to refer the dispute to
seek redressal – The submission that ‘any party to a dispute’ is
confined to a ‘supplier’ who has filed a memorandum u/s. 8 of the
Act is rejected – The issue(s) that have arisen in the decisions
of this Court in Silpi Industries v. Kerala State Road Transport
Corporation and Gujarat State Civil Supplies Corporation Limited v.
Mahakali Foods Private Limited were very different from the issue
that has arisen for consideration in the instant case – Though it
is possible for this Court to follow the precedents to arrive at the

* Author
[2025] 1 S.C.R.  611

NBCC (India) Ltd. v. The State of West Bengal & Ors.

conclusion that the judgments in the case of Silpi Industries and

Mahakali Foods coupled with the subsequent orders in Vaishno
Enterprises and M/s Nitesh Estates cannot be considered to be
binding precedents on the issue that has arisen for consideration,
taking into account the compelling need to ensure clarity and
certainty about the applicable precedents on the subject, it is
deemed appropriate to refer this appeal to a three Judge Bench.
[Paras 1.1, 29]

Interpretation of Statutes – Interpretation of Statutory Remedies

by Constitutional Courts:
Held: When a statutory remedy falls for consideration, it is the duty
of the Constitutional Court to adopt an interpretation which would
not only reduce the hiatus between a right and a remedy, but also
to ensure that the remedy is effective – If rights are recognition of
a claim, remedies are their actualization – While the rights regime
receives broad recognition under constitutional framework, it is
imperative that remedies must keep pace and be strengthened –
One of the core functions of the higher judiciary is to bridge the
gap between rights and remedies, and this would immediately give
rise to the legislative, executive and judicial obligations for their
provision, implementation, and declaration, respectively. [Para 10]

Justice – Access to justice – Right to an effective judicial

remedy:
Held: The right to an effective judicial remedy is an integral
part of access to justice – An effective judicial remedy under a
constitutional scheme must be (i) accessible, (ii) affordable, (iii)
expeditious and (iv) cohesive – Accessibility requires the remedy
to be easily available, physically and informationally – Affordability
is an aspect that is related to the cost of availing the remedy,
it must be at a reasonable price with a provision for legal aid,
if need be – The expeditious nature of a remedy is concerned
with the quick disposal of the case and abhors unreasonable
delays – Yet another facet of effective judicial remedy is its
cohesiveness – The cohesiveness of a remedy simply means
that a person must have one specified forum for the redressal
of grievances. [Para 10.1]
612 [2025] 1 S.C.R.

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Micro, Small and Medium Enterprises Development Act, 2006 –

s.18 – Words employed “any party to a dispute” – Golden
Rule of Interpretation:
Held: The text of Section 18 is clear and categoric – The words
employed herein are “any party to a dispute” – The age-old
principle, referred to as the Golden Rule of Interpretation, is
that “words of a statute have to be read and understood in their
natural, ordinary and popular sense” – The choice of the words
‘any party to a dispute’ in Section 18 of the Act is deliberate – If
the Parliament had intended that ‘any party’ must be confined only
to a “supplier”, or even a buyer, which expression is also defined,
it would as well have used that or those very expressions – The
Court cannot substitute the expression “any party” with “supplier”
and change the text and, consequently, the scope and ambit of
Section 18 altogether. [Para 14.1]

Micro, Small and Medium Enterprises Development Act, 2006 –

s.18 – Purpose and Object:
Held: Apart from the text and context in which Section 18 of the
Act employs the expression “any party to the dispute”, it is also
to be seen that the section is provisioning a remedy for resolution
of disputes – This remedy is provided by the statute, not by an
agreement between the parties – It is therefore, necessary to keep
it unrestricted and open-ended, enabling any party to a dispute
to access the remedy – When statutory provision incorporation
remedies for resolution of disputes fall for consideration,
constitutional courts must interpret such remedies in a manner
that would effectuate access to justice. [Para 14.3]

Micro, Small and Medium Enterprises Development Act,

2006 – s.18 – Whether filing of memorandum u/s.8 is
mandatory:
Held: Section 8(1)(a) provides that, “a micro or a small enterprise
may, at his discretion” and even a medium enterprise engaged
in providing or rendering services, also “may at his discretion”
file a memorandum with the authority as may be specified by the
Government – Further, sub-section (4) of Section 8 relates to micro
or small enterprises, the State Government shall by notification,
specify the authority with which such micro or small enterprise
[2025] 1 S.C.R.  613

NBCC (India) Ltd. v. The State of West Bengal & Ors.

may file a memorandum – Considering the choice and discretion

specifically provided to these enterprises, it becomes very clear
that there is no mandatory prescription of filing a memorandum.
[Para 14.5]

Case Law Cited

Silpi Industries v. Kerala State Road Transport Corporation [2021]
3 SCR 1044 : (2021) 18 SCC 790; Gujarat State Civil Supplies
Corporation Limited v. Mahakali Foods Private Limited [2022] 19
SCR 1094 : (2023) 6 SCC 401 – distinguished.
Kone Elevator India Private Limited v. State of Tamil Nadu
[2014] 5 SCR 912 : (2014) 7 SCC 1; Shanti Conductors Private
Ltd. v. Assam State Electricity Board [2019] 1 SCR 489 : (2019)
19 SCC 529; Anita Kushwaha v. Pushap Sudan [2016] 9 SCR
560 : (2016) 8 SCC 509; State of Andhra Pradesh v. Linde
(India) Ltd. [2020] 5 SCR 838 : (2020) 16 SCC 335; Grid Corpn.
of Orissa Ltd. v. Eastern Metals & Ferro Alloys [2010] 10 SCR
779 : (2011) 11 SCC 334; GE T&D India Ltd. v. Reliable Engg.
Projects & Mktg., 2017 SCC OnLine Del 6978; Re: Gujarat
State Civil Supplies Corporation Ltd. v. Mahakali Foods Pvt. Ltd.
[2022] 19 SCR 1094 : (2023) 6 SCC 401; Shanti Conductors
(P) Ltd. v. Assam SEB [2019] 1 SCR 489 : (2019) 19 SCC 529 :
(2020) 4 SCC (Civ) 409; Vaishno Enterprises v. Hamilton Medical
AG and Anr. [2022] 1 SCR 771 : 2022 SCC OnLine SC 355;
M/s Nitesh Estates Ltd. v. Micro and Small Enterprises Facilitation
Council of Haryana & Ors., C.A. No. 5276/2022@ SLP (C) No.
26682/2018; State of U.P. v. Synthetics and Chemicals Ltd.
[1991] 3 SCR 64 : (1991) 4 SCC 139; Municipal Corporation
of Delhi v. Gurnam Kaur [1988] Supp. 2 SCR 929 : (1989) 1
SCC 101; Arnit Das v. State of Bihar [2000] Supp. 1 SCR 69 :
(2000) 5 SCC 488; Union of India v. All Gujarat Federation of Tax
Consultants (2006) 13 SCC 473; Francis Stanly v. Intelligence
Officer, Narcotic Control Bureau, Thiruvananthapuram [2006]
Supp. 10 SCR 977 : (2006) 13 SCC 210; Bharat Petroleum
Corporation Ltd. v. P. Kesavan [2004] 3 SCR 811 : (2004) 9
SCC 772; Vishnu Dutt Sharma v. Manju Sharma [2009] 3 SCR
891 : (2009) 6 SCC 379; Chandigarh Housing Board v. Narinder
Kaur Makol [2000] Supp. 1 SCR 487 : (2000) 6 SCC 415;
Allen v. Flood (1893) AC 1 – referred to.
614 [2025] 1 S.C.R.

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Books and Periodicals Cited

‘2024 Theme: MSMEs and the SDGs’ (United Nations) (2024);
‘A microscope on small businesses: The productivity opportunity by
country’ (McKinsey Global Institute) (July 22, 2024); ‘The MSME
Revolution: Transforming India’s Economic Landscape’ (Press
Information Bureau) (Dec 23, 2024); ‘MSMEs: The Backbone of
India’s Economic Future’ (Invest India); ‘Women-led Enterprises’
(Lok Sabha Digital Library) (June 28, 2024); ‘Participation of
Females in MSMEs’ (Lok Sabha Digital Library) (Feb 8, 2024);
‘Economic Survey 2023-24’; Report of the Expert Committee on
Micro, Small and Medium Enterprises (June, 2019); ‘Commentary
on Constitution of India’ (9th Edition, Vol. IX).

List of Acts
Small Scale and Ancillary Industrial Undertakings Act, 1993; Micro,
Small and Medium Enterprises Development Act, 2006; Small
Scale and Ancillary Industrial Undertakings Act, 1993; Arbitration
and Conciliation Act, 1996; Limitation Act, 1963; Constitution of
India.

List of Keywords
Micro, Small and Medium Enterprises Development Act, 2006;
MSME; Facilitation Council; Golden Rule of Interpretation;
Interpretation of Statutes; Precedent making; Decision-making;
Section 18 of the Micro, Small and Medium Enterprises Development
Act, 2006; Article 141 of the Constitution.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3705 of 2024
From the Judgment and Order dated 18.05.2022 of the High Court
at Calcutta in APO No. 11 of 2022

Appearances for Parties

Gopal Sankaranarayanan, Sr. Adv., Nagarkatti Kartik Uday,
Ms. Shivani Vij, Advs. for the Appellant.
Ms. Madhumita Bhattacharjee, Ms. Debarati Sadhu, Ms. Srija
Choudhury, Anant, Sudarshan Rajan, Satyam Dwivedi, Mahesh
Kumar, Roshan Santhalia, Advs. for the Respondents.
[2025] 1 S.C.R.  615

NBCC (India) Ltd. v. The State of West Bengal & Ors.

Judgment / Order of the Supreme Court

Judgment

Pamidighantam Sri Narasimha, J.

Table of Contents*

1. Introduction ......................................................................... 2

2. Facts ................................................................................... 4

3. Decisions of the Single Judge and the Division

Bench .................................................................................. 6

4. Submissions ......................................................................... 7

5. Issue for our consideration ............................................. 8

6. The repealed Interest on Delayed Payments to Small

Scale and Ancillary Industrial Undertakings Act, 1993
and the judgment in Shanti Conductors v. Assam State
Electricity Board ................................................................ 8

7. The Micro, Small and Medium Industry in our

Country ................................................................................ 12

8. Interpretation of Statutory Remedies by Constitutional

Courts .................................................................................. 15

9. Statutory Scheme of the MSMED Act, 2006 ................... 17

10. Whether registration is a necessary precondition to

referring a dispute under Section 18 of the Act ............ 20

11. Re: Silpi Industries v. Kerala State Road Transport

Corporation ......................................................................... 31

12. Re: Gujarat State Civil Supplies Corporation Ltd. v.

Mahakali Foods Pvt. Ltd. ................................................ 35

13. Conclusion and reference to larger Bench .................... 42

* Ed. Note: Pagination as per the original Judgment.

616 [2025] 1 S.C.R.

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1. Introduction: The old value of ‘Small is beautiful’ 1 has not lost

its relevance. Recognising the contribution of micro, small and
medium enterprises towards economic development, the United
Nations declared June 27th as MSME day. MSMEs are said to be
the backbone of many economies, including India. This resonates
with the statement of the father of our nation, Mahatma Gandhi,
declaring that the ‘salvation of India lies in cottage and small scale
industries’. The Parliament enacted the Micro, Small and Medium
Enterprises Development Act, 20062 for facilitating the promotion
and development of the enterprises by creating certain rights and
duties and establishing a Board, Advisory Committee, and Facilitation
Council. Importantly, the Act provided a mechanism for dispute
resolution.
1.1 The MSME before us has a simple prayer. It seeks to refer the
dispute that it has with the buyer regarding payment of its dues
to the Facilitation Council for arbitration under Section 18 of
the Act, which provides that “any party to a dispute may, with
regard to any amount due under section 17, make a reference
to the Micro and Small Enterprises Facilitation Council”. The
appellant opposes this prayer by contending that ‘any party’
can only be a ‘supplier’ and that supplier should have been
registered under Section 8 of the Act even before execution
of the contract, if not, the reference is impermissible. The High
Court did not answer this question. Instead, it permitted the
parties to raise such objections before the Arbitral Tribunal.
The buyer is in appeal before us, raising the same question
as a jurisdictional issue.
1.2 We have examined the text, context, and purpose of the Act to
arrive at the decision that Section 18 is not restrictive and is a
remedy for the resolution of disputes, and as such, it is kept
open-ended to enable ‘any party’ to refer the dispute to seek

1 E.F. Schumacher, ‘Small Is Beautiful: A Study of Economics as if People Mattered’ (1973) “We need
the freedom of lots and lots of small, autonomous units, and, at the same time, the orderliness of large-
scale, possibly global, unity and co-ordination. When it comes to action, we obviously need small units,
because action is a highly personal affair, and one cannot be in touch with more than a very limited
number of persons at any one time.”
2 Hereinafter referred to as ‘the Act’.
[2025] 1 S.C.R.  617

NBCC (India) Ltd. v. The State of West Bengal & Ors.

redressal. For the reasons to follow, we rejected the submission

that ‘any party to a dispute’ is confined to a ‘supplier’ who has
filed a memorandum under Section 8 of the Act. We have also
explained that the issue(s) that have arisen in the decisions
of this Court in Silpi Industries v. Kerala State Road Transport
Corporation3 and Gujarat State Civil Supplies Corporation
Limited v. Mahakali Foods Private Limited 4 were very different
from the issue that has arisen for our consideration. However,
for clarity and legal certainty, we have directed the appeal be
placed before the Hon’ble Chief Justice of India for referring
the matter to a bench of three Judges for an authoritative
pronouncement.
1.3 We will first state the necessary facts before considering the
submissions, followed by our reasons and conclusions.
2. Facts: The appellant, National Buildings Construction Corporation,
granted four work orders between July 2015 to August 2016 to
M/s Saket Infra Developers Private Limited, respondent No. 4 5 for
undertaking construction work at different places in West Bengal.
Pursuant to the work orders, contracts were executed on 27.08.2015,
17.11.2015, 28.07.2016 and 20.08.2016. The Enterprise filed a
memorandum under Section 8 of the Act on 19.11.2016 as a ‘small
enterprise’. Thereafter, on 15.09.2017, the appellant also executed
a fifth contract in favour of the Enterprise.
2.1 Work is said to have commenced on various dates, supplies
continued, and bills were raised from time to time by the
Enterprise, even after filing of the memorandum under Section 8
of the Act. The Table showing dates of the work orders, contract
and particulars of the work awarded and details of bills raised
after registration is as under:

3 [2021] 3 SCR 1044 : (2021) 18 SCC 790, hereinafter referred to, in short as Silpi Industries.
4 [2022] 19 SCR 1094 : (2023) 6 SCC 401, hereinafter referred to, in short as Mahakali Foods.
5 Hereinafter referred to as the ‘Enterprise’.
618 [2025] 1 S.C.R.

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S. Dates Dates of Bills raised

No. of Work Construction after
Orders Contracts Registration on
19.11.2016
1. Contract-I 27.08.2015 10 Bills for 34.71
crores
30.07.2015 Office Building
for National Jute
Board, Rajarhat,
Kolkata
2. Contract-II 17.11.2015 8 Bills for 14.18
crores
26.10.2015 Residential
Quarters for ISI,
Kolkata
3. Contract-III 28.07.2016 10 Bills for 10.49
crores
19.01.2016 ITI Campus,
Darjeeling
4. Contract-IV 20.08.2016 8 Bills for 12.46
crores
19.08.2016 Regional Centre for
Lalit Kala Academy,
Kolkata
19.11.2016 Registration of Respondent No. 4 as
Small Undertaking
5. Contract-V 11.10.2017 5 Bills for 15.72
crores
15.09.2017 MSTC Office,
Rajarhat, Kolkata

2.2 During the subsistence of the contract, disputes arose between

the parties in connection with all five contracts. It may be
mentioned here itself that, with respect to the fifth contract,
the Enterprise instituted a commercial suit [(Comm.) No. 229
of 2021] before the High Court of Delhi, which is said to be
pending consideration. However, this fact does not have any
bearing on the issues before this Court.
2.3 Seeking resolution of disputes, on 28.03.2019, the Enterprise
made a reference under Section 18 of the Act for recovery of
[2025] 1 S.C.R.  619

NBCC (India) Ltd. v. The State of West Bengal & Ors.

the amounts due to it to the West Bengal State Micro and Small
Enterprises Facilitation Council6. The Facilitation Council initiated
action, and with the failure of the conciliation proceedings under
Section 18(2) of the Act, the dispute was referred to arbitration
under Section 18(3) on 19.01.2021. A further notice of the
arbitral proceedings was also issued, and it was received by
the appellant on 30.09.2021.
2.4 The appellant objected to the Facilitation Council entertaining
the reference, firstly on the ground that the Enterprise was
not registered before the execution of the contracts and, as
such, the Facilitation Council does not have jurisdiction under
Section 18. Secondly, it was also argued that the subject matter
of the contract relates to the execution of the works contracts,
which falls outside the scope and ambit of the Act. Carrying
these objections further, the appellant filed a Writ Petition under
Article 226 of the Constitution of India before the High Court
of Calcutta, raising the jurisdictional question of the Facilitation
Council entertaining the reference.
3. Decisions of the Single Judge and the Division Bench: The
learned Single Judge dismissed the Writ Petition on 16.12.2021 by
simply holding that “the question of jurisdiction can be raised before
the Arbitral Tribunal, which shall decide the same before entering into
other questions.” The decision of the Single Judge was challenged
unsuccessfully before the Division Bench of the High Court by the
order impugned before us. The Division Bench also referred the
decision of this Court in Kone Elevator India Private Limited v. State
of Tamil Nadu 7 to hold that a works contract is an indivisible contract
and also that the Act, being a special legislation, overrides other
statutes. The Division Bench agreed with the finding of the Single
Judge that all objections, including those relating to maintainability,
can be raised and contested before the arbitrator. Thus, the appellant
is in appeal before us.
4. Submissions: Mr. Gopal Sankaranarayanan, learned senior counsel,
appearing for the appellant, challenged the jurisdiction of the
Facilitation Council in entertaining the reference under Section 18 of

6 Hereinafter referred to as the ‘Facilitation Council’.

7 [2014] 5 SCR 912 : (2014) 7 SCC 1
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the Act by the Enterprise for the simple reason that it registered itself
after the contracts were executed and not before. His submission
is based on the decision of this Court in Silpi Industries (supra) and
Mahakali Foods (supra). Though the impugned decision of the High
Court was on 18.05.2022, almost a year after the judgment of this
Court in Silpi Industries (supra), it has not taken note of the judgment
of this Court. Mr. Gopal Sankaranarayanan also referred to certain
subsequent orders of this Court, which we will be examining while
considering the issue.
4.1 Ms. Madhumita Bhattacharjee and Mr. Roshan Santhalia,
learned counsels for respondents, opposed the appellant’s
arguments and contended that these questions can always be
raised before the Arbitral Tribunal as directed by the Single as
well as the Division Bench of the High Court.
5. Issue for our consideration: The question of law for our consideration
is whether an MSME cannot make a reference to the Facilitation
Council for dispute resolution under Section 18 of the Act if it is not
registered under Section 8 of the Act before the execution of the
contract with the buyer.
6. Before we examine the provisions of the Act and the ratio of the
judgment of this Court in Silpi Industries (supra) and Mahakali Foods
(supra), it is necessary to take note of the statute (repealed Act) that
preceded the Act and also the important judgment of this Court in
Shanti Conductors Private Ltd. v. Assam State Electricity Board,8
which also has a direct bearing on the decision in Silpi Industries
(supra) and for interpreting the provisions of the Act.
7. The repealed Interest on Delayed Payments to Small Scale and
Ancillary Industrial Undertakings Act, 1993 9 and the judgment in
Shanti Conductors v. Assam State Electricity Board : The decision
of this Court in Shanti Conductors (supra), a three-Judge Bench
Judgment, was necessitated because of the difference of opinion
between two Judges. The relevant facts of Shanti Conductors (supra)
are that the Small-Scale Industry therein entered into a contract for
supply of goods and services to the buyer before the said 1993

8 [2019] 1 SCR 489 : (2019) 19 SCC 529, hereinafter referred to, in short as Shanti Conductors.
9 Hereinafter referred to as the repealed statute.
[2025] 1 S.C.R.  621

NBCC (India) Ltd. v. The State of West Bengal & Ors.

repealed statute came into force. However, the supplies under the
contract were rendered after the said statute came into force. Of
the seven questions of law that were formulated by the three-judge
bench, the first two questions, relevant to our purpose, are extracted
for ready reference. It is necessary to mention here that filing of a
memorandum by any MSME was never an issue there, as, in fact,
there was no such requirement under the repealed statute. The
issues in Shanti Conductors (supra) are as follows:
“34.1.(1) Whether the 1993 Act is not applicable when the
contract for supply was entered into between the parties
prior to the enforcement of the Act i.e., 23-9-1992?
34.2. (2) Whether in the event it is found that the Act is
applicable also with regard to contract entered prior to the
1993 Act in pursuance of which contract, supplies were
made after the enforcement of the 1993 Act, the 1993 Act
can be said to have retrospective operation?”
7.1 The repealed statute comprised of 11 provisions, of which Section
3 related to the liability of the buyer to make payment, Section 4
related to the date and rate of interest payable, Section 5 related
to the liability to pay compound interest, and Section 6 related
to the right of recovery of the amount payable to the supplier.
7.2 Having considered the statutory scheme, the Court came to
the conclusion that the incidence of applicability of the liability
under that statute is supply of goods or rendering of services.
The Court categorically held that the liability of the buyer for
payment under the Act arises even if the agreement of sale is
prior to the Act (repealed) but if the supplies were made after
the Act.
7.3 Answering the first question, this Court held as under: -
“61. We have noticed above that the incidence of
applicability of the liability under the Act is supply of goods
or rendering of service. In event the supply of goods
and rendering of services is subsequent to the Act, can
liability to pay interest on delayed payment be denied
on the ground that agreement in pursuance of which
supplies were made were entered prior to enforcement of
the Act? Entering into an agreement being not expressly
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or impliedly referred to in the statutory scheme as an

incident for fastening of the liability, making the date of
agreement as date for imposition of liability does not
conform to the statutory scheme. This can be illustrated
by taking an example. There are two small scale industries
which received orders for supply of materials. ‘A’ received
such orders prior to the enforcement of the Act and ‘B’
received the order after the enforcement of the Act. Both
supplied the goods subsequent to enforcement of the Act
and became entitled to receive payment after the supply,
on or before the day agreed upon between the supplier
and buyer or before the appointed day. Payments were
not made both to ‘A’ and ‘B’ as required by Section 3.
Can the buyer who has received supplies from supplier
‘A’ escape from his statutory liability to make payment of
interest under Section 3 read with Section 4? The answer
has to be No. Two suppliers who supply goods after the
enforcement of the Act, become entitled to receive payment
after the enforcement of the Act one supplier cannot
be denied the benefit of the statutory protection on the
pretext that the agreement in his case was entered prior
to enforcement of the Act. When the date of agreement
is not referred as material or incidence for fastening the
liability, by no judicial interpretation the said date can be
treated as a date for fastening of the liability. The 1993 Act
being beneficial legislation enacted to protect small scale
industries and statutorily ensure by mandatory provision for
payment of interest on the outstanding money, accepting
the interpretation as put by the learned counsel for the
Board that the day of agreement has to be subsequent to
the enforcement of the Act, the entire beneficial protection
of the Act shall be defeated. The existence of statutory
liability depends on the statutory factors as enumerated
in Section 3 and Section 4 of the 1993 Act. Factor for
liability to make payment under Section 3 being the supplier
supplies any goods or renders services to the buyer, the
liability of buyer cannot be denied on the ground that the
agreement entered into between the parties for supply
was prior to the 1993 Act. To hold that liability of buyer
for payment shall arise only when agreement for supply
[2025] 1 S.C.R.  623

NBCC (India) Ltd. v. The State of West Bengal & Ors.

was entered into subsequent to enforcement of the Act, it

shall be adding words to Section 3 which is not permissible
under the principles of statutory construction.
62. We, thus, are of the view that the judgments in
Purbanchal Cables & Conductors,10 Assam Small Scale
Industries11 and Shakti Tubes Ltd.12 which held that the
1993 Act shall be applicable only when the agreement
to sale/contract was entered into prior/subsequent to the
enforcement of the Act, does not lay down the correct law.
We accept the submission of the learned counsel for the
appellants that even if agreement of sale is entered into
prior to enforcement of the Act, liability to make payment
under Section 3 and liability to make payment of interest
under Section 4 shall arise if supplies are made subsequent
to the enforcement of the Act.”
(emphasis supplied)
7.4 The ratio of the decision in Shanti Conductors can be formulated
as follows:
i) Even if contracts are entered into before the commencement
of the repealed statute, the liability to make payment under
Section 3, and to pay interest thereon under Sections 4
and 5 and to recover the amount under Section 6 will arise
if the supplies are made subsequent to the enforcement
of the statute. The incidence of liability under the repealed
statute is ‘supply of goods or rendering of services’,
ii) when the date of contract is neither referred to nor made
an incident for fastening the liability under the statute, by
way of judicial interpretation, courts cannot treat the said
date as the date for fastening the liability. The existence of
the statutory liability depends on the language employed
in Sections 3 to 6 of the statute,
iii) to hold that the liability of the buyer to make payment shall
arise only when the contract for supply was entered into

10 Purbanchal Cables & Conductors (P) Ltd. v. Assam SEB (2012) 7 SCC 462
11 Assam Small Scale Industries Development Corpn. Ltd. v. J.D. Pharmaceuticals (2005) 13 SCC 19
12 Shakti Tubes Ltd. v. State of Bihar (2009) 7 SCC 673
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subsequent to the enforcement of the Act will defeat the

purpose and object of the beneficial legislation intended
to protect small-scale and ancillary industrial undertakings.
8. The Micro, Small and Medium Industry in our Country: After
the repeal of the 1993 Act, the present Act came into force with
effect from 02.10.2006. The Act is a comprehensive legislation that
recognises and seeks to rejuvenate the importance of MSMEs, whose
importance and contribution is accepted in contemporary economies
across the globe, and accredited by the United Nations13. United
Nations, commenting on the significance of MSMEs observes that:
“MSMEs help reduce levels of poverty through job creation
and economic growth; they are key drivers of employment,
decent jobs and entrepreneurship for women, youth and
groups in vulnerable situations. They are the majority of
the world’s food producers and play critical roles in closing
the gender gap as they ensure women’s full and effective
participation in the economy and in society”.
8.1 In the statement of object and reasons of the Act, it is mentioned
that “many Expert Groups and Committees appointed by the
Government from time to time as well as small scale industry
sector itself has emphasised the need for a comprehensive
central enactment to provide an appropriate framework for the
sector to facilitate its growth and development, emergence
of a large service sector assisting the small scale industry in
the last two decades also warrants a composite view of the
sector encompassing both industrial units and related service
entities. The world over, the emphasis has now been shifted
from industries to Enterprises.”
8.2 The rights, incentives and remedies provisioned under the
Act are the backbone of our economy. Statistics indicate that
MSMEs provide employment to 62% of the country’s workforce,
contribute 30% to India’s GDP,14 and account for around 45% of

13 ‘2024 Theme: MSMEs and the SDGs’ (United Nations) <https://www.un.org/en/observances/micro-

small-medium-businesses-day> (2024).
14 ‘A microscope on small businesses: The productivity opportunity by country’ (McKinsey Global Institute)
<https://www.mckinsey.com/mgi/our-research/a-microscope-on-small-businesses-the-productivity-
opportunity-by-country#/> (May 29, 2024); ‘Contribution Of MSMEs to the GDP’ (Press Information
Bureau) <https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2035073> (July 22, 2024).
[2025] 1 S.C.R.  625

NBCC (India) Ltd. v. The State of West Bengal & Ors.

India’s total exports15. The Indian MSME sector is projected to

grow to $1 trillion by 202816. Moreover, MSMEs play a crucial
role in promoting rural development, women’s employment,
and inclusive growth. 19.5% of total MSMEs17 and 70% of
informal micro-enterprises are owned by women18. There is
undoubtedly a global consensus regarding the indispensable
importance of MSMEs.
8.3 However, while the United Nations and even the Expert Groups
and Committees appointed by the Government from time to time
have underscored the importance of MSMEs, and that has led
to the Parliament enacting the present legislation, MSMEs in
India have been facing many challenges which are reflected
in their performance. A recent report records that, “MSMEs in
India contribute 30% to value-addition and 62% to employment”,
as against “49% and 77%, in other emerging economies”.19
The 2023-2024 Economic Survey also recorded the concerns
faced by MSME’s.20
9. It is in the above-referenced context that we need to comprehend,
interpret and construct the remedies contemplated under the Act.
10. Interpretation of Statutory Remedies by Constitutional Courts:
When a statutory remedy falls for consideration, it is the duty of the
Constitutional Court to adopt an interpretation which would not only
reduce the hiatus between a right and a remedy, but also to ensure
that the remedy is effective. If rights are recognition of a claim,

15 ‘The MSME Revolution: Transforming India’s Economic Landscape’ (Press Information Bureau) <https://
pib.gov.in/PressReleasePage.aspx?PRID=2087361> (Dec 23, 2024).
16 ‘MSMEs: The Backbone of India’s Economic Future’ (Invest India) <https://www.investindia.gov.in/team-
india-blogs/msmes-backbone-indias-economic-future> (June 28, 2024).
17 ‘Women-led Enterprises’ (Lok Sabha Digital Library) <https://eparlib.nic.in/bitstream/123456789/2502792/
1/AU3648.pdf> (Aug 10, 2023).
18 ‘’Participation of Females in MSMEs’ (Lok Sabha Digital Library) <https://eparlib.nic.in/bitstream/
123456789/2974207/1/AU1128.pdf> (Feb 8, 2024).
19 ‘A microscope on small businesses: The productivity opportunity by country’ (McKinsey Global Institute)
<https://www.mckinsey.com/mgi/our-research/a-microscope-on-small-businesses-the-productivity-
opportunity-by-country#/> (May 29, 2024).
20 ‘Economic Survey 2023-24’ <https://www.indiabudget.gov.in/economicsurvey/doc/echapter.pdf> (2024)
“Licensing, Inspection, and Compliance requirements that MSMEs have to deal with, imposed particularly
by sub-national governments, hold them back from growing to their potential and being job creators of
substance…Further, many MSMEs struggle to secure the necessary funds to start, operate, or expand
their business due to a variety of reasons including lack of collateral or credit history, high interest rates,
complex documentation requirements, and long processing times, etc.” (emphasis supplied).
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remedies are their actualization. While the rights regime receives

broad recognition under our constitutional framework, it is imperative
that remedies must keep pace and be strengthened. One of the core
functions of the higher judiciary is to bridge the gap between rights
and remedies, and this would immediately give rise to the legislative,
executive and judicial obligations for their provision, implementation,
and declaration, respectively.
10.1 The right to an effective judicial remedy is an integral part
of access to justice.21 An effective judicial remedy under a
constitutional scheme must be (i) accessible, (ii) affordable,
(iii) expeditious and (iv) cohesive. Accessibility requires the remedy
to be easily available, physically and informationally. Affordability
is an aspect that is related to the cost of availing the remedy, it
must be at a reasonable price with a provision for legal aid, if
need be. The expeditious nature of a remedy is concerned with
the quick disposal of the case and abhors unreasonable delays.
Yet another facet of effective judicial remedy is its cohesiveness.
The cohesiveness of a remedy simply means that a person must
have one specified forum for the redressal of grievances. This
requirement must be understood as an antithesis of fragmentation
of remedies, i.e., a litigant ought not to be forced to approach
multiple forums for the same cause of action. When a statute
provisioning a judicial remedy falls for construction, the choice
of interpretative outcome is not governed so much by the power
or privileges under the Constitution, but by the constitutional
duties to create effective judicial remedies in furtherance of the
right to access to justice. A meaningful interpretation that furthers
effective judicial access is a constitutional imperative and it is this
duty that must inform the interpretative criteria. It is in the above
referred context that we will now examine Section 18 of the Act.
11. Statutory Scheme of the MSMED Act, 2006: Sections 2(a), (c),
(e), (n), 7, 8, 17, 18, 20 and 21, to the extent that they are relevant,
are reproduced hereinbelow for ready reference.

21 See, generally, Anita Kushwaha v. Pushap Sudan, (2016) 8 SCC 509 “…Four main facets that, in our
opinion, constitute the essence of access to justice are: (i) the State must provide an effective adjudicatory
mechanism; (ii) the mechanism so provided must be reasonably accessible in terms of distance; (iii) the
process of adjudication must be speedy; and (iv) the litigant’s access to the adjudicatory process must be
affordable…In order that the right of a citizen to access justice is protected, the mechanism so provided
must not only be effective but must also be just, fair and objective in its approach...”
[2025] 1 S.C.R.  627

NBCC (India) Ltd. v. The State of West Bengal & Ors.

“2. Definitions- In this Act, unless the context otherwise

requires, -
(a) “Advisory Committee” means the committee constituted
by the Central Government under sub-section (2) of
section 7.
(b) …
(c) “Board” means the National Board for Micro, Small and
Medium Enterprises established under Section 3;
(e) “Enterprise” means an industrial undertaking or a
business concern or any other establishment, by whatever
name called, engaged in the manufacture or production of
goods, in any manner, pertaining to any industry specified
in the First Schedule to the Industries (Development and
Regulation) Act, 1951 (65 of 1951) or engaged in providing
or rendering of any service or services;
7. Classification of enterprises-(1) Notwithstanding
anything contained in section 11B of the Industries
(Development and Regulation) Act, 1951 (65 of 1951),
the Central Government may, for the purposes of this
Act, by notification and having regard to the provisions
of sub-sections (4) and (5), classify any class or classes
of enterprises, whether proprietorship, Hindu undivided
family, association of persons, co-operative society,
partnership firm, company or undertaking, by whatever
name called,--
(a) in the case of the enterprises engaged in the
manufacture or production of goods pertaining to any
industry specified in the First Schedule to the Industries
(Development and Regulation) Act, 1951 (65 of 1951),
as--
(i) a micro enterprise, where the investment in plant
and machinery does not exceed twenty five lakh
rupees;
(ii) a small enterprise, where the investment in plant
and machinery is more than twenty-five lakh rupees
but does not exceed five crore rupees; or
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(iii) a medium enterprise, where the investment in

plant and machinery is more than five crore rupees
but does not exceed ten crore rupees;
(b) in the case of the enterprises engaged in providing or
rendering of services, as--
(i) a micro enterprise, where the investment in
equipment does not exceed ten lakh rupees;
(ii) a small enterprise, where the investment in
equipment is more than ten lakh rupees but does
not exceed two crore rupees; or
(iii) a medium enterprise, where the investment in
equipment is more than two crore rupees but does
not exceed five crore rupees.
(2) The Central Government shall, by notification, constitute
an Advisory Committee consisting of the following
members, namely:--
(3) …
(4) The Central Government shall, prior to classifying any
class or classes of enterprises under sub-section (1),
obtain the recommendations of the Advisory Committee.
15. Liability of buyer to make payment.— Where any
supplier, supplies any goods or renders any services to
any buyer, the buyer shall make payment therefor on or
before the date agreed upon between him and the supplier
in writing or, where there is no agreement in this behalf,
before the appointed day:
Provided that in no case the period agreed upon between
the supplier and the buyer in writing shall exceed forty-five
days from the day of acceptance or the day of deemed
acceptance.
16. Date from which and rate at which interest is
payable.—Where any buyer fails to make payment of the
amount to the supplier, as required under section 15, the
buyer shall, notwithstanding anything contained in any
agreement between the buyer and the supplier or in any
law for the time being in force, be liable to pay compound
[2025] 1 S.C.R.  629

NBCC (India) Ltd. v. The State of West Bengal & Ors.

interest with monthly rests to the supplier on that amount

from the appointed day or, as the case may be, from the
date immediately following the date agreed upon, at three
times of the bank rate notified by the Reserve Bank.
“17. Recovery of amount due.- For any goods supplied
or services rendered by the supplier, the buyer shall be
liable to pay the amount with interest thereon as provided
under section 16.
18. Reference to Micro and Small Enterprises
Facilitation Council- (1) Notwithstanding anything
contained in any other law for the time being in force,
any party to a dispute may, with regard to any amount
due under section 17, make a reference to the Micro and
Small Enterprises Facilitation Council.
(2) On receipt of a reference under sub-section (1),
the Council shall either itself conduct conciliation in the
matter or seek the assistance of any institution or centre
providing alternate dispute resolution services by making
a reference to such an institution or centre, for conducting
conciliation and the provisions of sections 65 to 81 of the
Arbitration and Conciliation Act, 1996 (26 of 1996) shall
apply to such a dispute as if the conciliation was initiated
under Part III of that Act.
(3) Where the conciliation initiated under sub-section
(2) is not successful and stands terminated without any
settlement between the parties, the Council shall either
itself take up the dispute for arbitration or refer to it any
institution or centre providing alternate dispute resolution
services for such arbitration and the provisions of the
Arbitration and Conciliation Act, 1996 (26 of 1996) shall then
apply to the dispute as if the arbitration was in pursuance
of an arbitration agreement referred to in sub-section (1)
of section 7 of that Act.
(4) Notwithstanding anything contained in any other law for
the time being in force, the Micro and Small Enterprises
Facilitation Council or the centre providing alternate dispute
resolution services shall have jurisdiction to act as an
Arbitrator or Conciliator under this section in a dispute
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between the supplier located within its jurisdiction and a

buyer located anywhere in India.
(5) Every reference made under this section shall be
decided within a period of ninety days from the date of
making such a reference.”
20. Establishment of Micro and Small Enterprises
Facilitation Council.- The State Government shall,
by notification, establish one or more Micro and Small
Enterprises Facilitation Councils, at such places, exercising
such jurisdiction and for such areas, as may be specified
in the notification.
21. Composition of Micro and Small Enterprises
Facilitation Council.—
(1) The Micro and Small Enterprise Facilitation Council
shall consist of not less than three but not more than
five members to be appointed from among the following
categories, namely: —…
11.1 First and foremost, Chapter V of the Act deals with delayed
payments to micro and small enterprises and specifies the rights,
liabilities, recovery, and remedies in favour of micro and small
enterprises. The rights and liabilities are based on the incidence
of supply made by the micro and small enterprise. To this extent,
the Act continues the statutory scheme contemplated under the
repealed statute and, therefore, the principle laid down in Shanti
Conductors (supra) that the liability of a buyer commences
from the date of supply and not from the date of execution of
the agreement or contract, even though the contract was prior
to coming into force of the Act, continues to apply. Up to this
point, there seems to be no difficulty. The issue in the present
case takes a different turn, as explained in the following part.
12. Whether registration is a necessary precondition to referring a
dispute under Section 18 of the Act : The question that we are called
upon to answer is whether the reference to the Facilitation Council
under Section 18 of the Act is impermissible if the Enterprise is not
registered by filing a memorandum under Section 8 of the Act before
the contract is executed. This issue was not formulated, discussed
and decided in any other judgment of this Court, including the two
[2025] 1 S.C.R.  631

NBCC (India) Ltd. v. The State of West Bengal & Ors.

substantive judgments under the Act, i.e. Silpi Industries (supra)

or Mahakali Foods (supra). In these two judgements, it is worth
mentioning, such an issue was neither formulated, nor discussed.
We will explain this in detail while discussing the facts and the ratios
of these judgements. Apart from the submission of the appellant that
the issue arising for our consideration is covered by the decision
in Silpi Industries (supra), as approved in Mahakali Foods (supra),
on our specific enquiry as to under which provision of the Act an
Enterprise, which has not filed a memorandum under Section 8
would be barred from invoking remedies under Section 18 of the
Act, Mr. Gopal Sankaranarayanan made the following submission.
13. According to him, though Section 18 provides that ‘any party to a
dispute’ may make a reference to the Facilitation Council, the said
‘dispute’ must be “with regard to any amount due under Section 17”.
This requirement, he would submit, takes us to Section 17, which
provides that, “for any goods supplied or services rendered by the
supplier, the buyer shall be liable to pay the amount with interest
thereon under Section 16”. Section 16 is the liability of the buyer
to pay interest to the ‘supplier’ on the amounts payable to it under
Section 15 for the supply of goods and rendering of any services.
The expression ‘supplier’ mentioned in Sections 15, 16 and 17 is
defined in Section 2(n), as “a micro or small enterprise which has
filed a memorandum with the authority referred to in sub-section (1)
of Section 8 and includes,…”. Thus, it was submitted that a ‘supplier’
can only be an Enterprise that has filed a memorandum under Section
8 of the Act. He would conclude by submitting that for supplies made
prior to such registration, Enterprise cannot avail the remedies under
Section 18 of the Act.
14. We will now examine the submission in detail, the statutory provisions
have already been extracted hereinabove.
14.1 Simply the Text: The text of Section 18 is clear and categoric.
The words employed herein are “any party to a dispute”. The
text, “any party to a dispute”, cannot be read as a ‘supplier’ by
adopting a process of interpretation, by first referring to Section
17, then to Sections 15 and 16 and thereafter, in search of the
definition of supplier, to Section 2(n) and finally stopping at
Section 8 to hold that ‘any party to a dispute’ will only be an
Enterprise which is registered under Section 8 of the Act. This
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meaning-making process to metamorphosise the clear text ‘any

party’ to ‘a supplier’ is not the legal method to understand true
meaning of words employed by the legislature. The age-old
principle, referred to as the Golden Rule of Interpretation, is
that “words of a statute have to be read and understood in their
natural, ordinary and popular sense”.22 The choice of the words
‘any party to a dispute’ in Section 18 of the Act is deliberate.
The legislative device of employing different expressions in
successive provisions of the same statute is well known and
intended to effectuate the desired purpose of the Act. If the
Parliament had intended that ‘any party’ must be confined only to
a “supplier”, or even a buyer, which expression is also defined,
it would as well have used that or those very expressions. The
Court cannot substitute the expression “any party” with “supplier”
and change the text and, consequently, the scope and ambit
of Section 18 altogether.
14.2 The context: Mention of Section 17 in Section 18 is only to
provide context for a reference of dispute. The contextual
relevance of locating Section 17 in Section 18 is only
to provide the purpose of reference, not to confine the
remedy to a registered Enterprise. This is to clarify that the
reference shall be to adjudicate the dispute arising out of
a liability of the buyer which is declared under Sections 15
and 16.
14.3 The purpose and object of Section 18: Apart from the text and
context in which Section 18 of the Act employs the expression
“any party to the dispute”, it is also to be seen that the section
is provisioning a remedy for resolution of disputes. This remedy
is provided by the statute, not by an agreement between the
parties. It is therefore, necessary to keep it unrestricted and
open-ended, enabling any party to a dispute to access the
remedy. When statutory provision incorporation remedies for
resolution of disputes fall for consideration, constitutional courts
must interpret such remedies in a manner that would effectuate
access to justice.

22 State of Andhra Pradesh v. Linde (India) Ltd. (2020) 16 SCC 335; Grid Corpn. of Orissa Ltd. v. Eastern
Metals & Ferro Alloys (2011) 11 SCC 334.
[2025] 1 S.C.R.  633

NBCC (India) Ltd. v. The State of West Bengal & Ors.

14.4 The definition clause: We will now examine the sheet anchor
of Mr. Gopal Sankaranarayanan’s arguments that a supplier
is defined under Section 2(n) can only be an Enterprise that
has filed a memorandum under Section 8 of the Act. For this
purpose, we will extract the entirety of the definition of supplier
under Section 2(n) of the Act;
2(n). “supplier” means a micro or small enterprise,
which has filed a memorandum with the authority
referred to in sub-section (1) of section 8, and
includes,—
(i) the National Small Industries Corporation,
being a company, registered under the
Companies Act, 1956 (1 of 1956);
(ii) the Small Industries Development Corporation
of a State or a Union territory, by whatever name
called, being a company registered under the
Companies Act, 1956 (1 of 1956);
(iii) any company, co-operative society, trust or
a body, by whatever name called, registered or
constituted under any law for the time being in
force and engaged in selling goods produced
by micro or small enterprises and rendering
services which are provided by such enterprises;
From a plain reading of the Section 2(n), it is clear that the
definition of a supplier is relatable only to a micro or a small
enterprise and does not encompass a medium enterprise.
Supplier not only means a micro or small enterprise, ‘which have
filed a memorandum with the authority referred to under sub-
Section (1) of Section 8’, but also includes (i)NSIC, (ii) SIDC, and
the (iii) company, cooperative society, trust or a body engaged
in selling of goods produced by micro or small enterprise and
rendered services which are produced by such enterprise. In
other words, a supplier will also be an entity engaged in selling
goods or rendering services, produced or provided by a micro
or small enterprise. All such entities, irrespective of filing of the
memorandum will be suppliers. Thus, the definition of a supplier
encompasses not only those who have filed a memorandum,
634 [2025] 1 S.C.R.

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but also those who have not filed. The reason for keeping the
definition is not difficult to imagine. This is still an unorganised
industry, growing, evolving and many of them are at start-up
levels. The reason for keeping the definition wide is supported
by an Expert Committee, whose opinion we will refer to in the
next Section.
14.5 Filing of memorandum under Section 8 is discretionary: We will
now examine Section 8 of the Act relied on by the appellants
to contend that filing of a memorandum by micro, small and
medium enterprises is mandatory. Section 8 is extracted herein
for ready reference:
8. Memorandum of micro, small and medium
enterprises. — (1) Any person who intends to
establish, —
(a) a micro or small enterprise, may, at his discretion,
or
(b) a medium enterprise engaged in providing or
rendering of services may, at his discretion; or
(c) a medium enterprise engaged in the manufacture
or production of goods pertaining to any industry
specified in the First Schedule to the Industries
(Development and Regulation) Act, 1951 (65 of
1951), shall
file the memorandum of micro, small or, as the case
may be, of medium enterprise with such authority as
may be specified by the State Government under
sub-section (4) or the Central Government under
sub-section (3):
Provided that any person who, before the
commencement of this Act, established—
(a) a small scale industry and obtained a
registration certificate, may, at his discretion;
and
(b) an industry engaged in the manufacture or
production of goods pertaining to any industry
specified in the First Schedule to the Industries
[2025] 1 S.C.R.  635

NBCC (India) Ltd. v. The State of West Bengal & Ors.

(Development and Regulation) Act, 1951 (65 of

1951), having investment in plant and machinery
of more than one crore rupees but not exceeding
ten crore rupees and, in pursuance of the
notification of the Government of India in the
erstwhile Ministry of Industry (Department of
Industrial Development) number S.0.477 (E)
dated the 25th July, 1991 filed an Industrial
Entrepreneurs Memorandum, shall
within one hundred and eighty days from the
commencement of this Act, file the memorandum, in
accordance with the provisions of this Act.
(2) The form of the memorandum, the procedure of
its filing and other matters incidental thereto shall be
such as may be notified by the Central Government
after obtaining the recommendations of the Advisory
Committee in this behalf.
(3) The authority with which the memorandum shall be
filed by a medium enterprise shall be such as may be
specified by notification, by the Central Government.
(4) The State Government shall, by notification,
specify the authority with which a micro or small
enterprise may file the memorandum.
(5) The authorities specified under sub-sections (3)
and (4) shall follow, for the purpose of this section,
the procedure notified by the Central Government
under sub-section (2).”
(emphasis supplied)
Section 8(1)(a) provides that, “a micro or a small enterprise may,
at his discretion” and even a medium enterprise engaged in
providing or rendering services, also “may at his discretion” file
a memorandum with the authority as may be specified by the
Government. This important feature of the statute recognising
and vesting of the discretion has not been noticed. There is
also a logical follow-up to this choice or discretion vested
in the micro or small enterprise and the medium enterprise
engaged in rendering services for filing a memorandum in sub-
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section (4) of Section 8 and also proviso (a) to Section 8(1). As

the said sub-section (4) of Section 8 relates to micro or small
enterprises, the State Government shall by notification, specify
the authority with which such micro or small enterprise may
file a memorandum. Considering the choice and discretion
specifically provided to these enterprises, it becomes very clear
that there is no mandatory prescription of filing a memorandum.
Conversely it appears that medium enterprises engaged in
manufacture or production of goods, “shall file a memorandum”
with such authority as may be specified, and this is reflected
in the proviso (b) to Section 8(1). At this stage, it is relevant to
note that the definition of supplier under Section 2(n) is confined
only to micro or small enterprise and does not encompass a
medium enterprise.
14.6 There is a reason for this. The report of the Expert Committee on
Micro, Small and Medium Enterprises clarifies the position that
filing of memorandum by these enterprises is never mandatory.
The relevant portion is as under23:
4.5 Formalization of MSMEs
As per 73rd round of National Sample Survey
(NSS), there are 63.39 million MSMEs in the
country. However, a large number of MSEs exist in
the informal sector and are not registered with any
statutory authority. Reasons for lack of registration
are many and varied. For nano/household type of
enterprises, in their view, not obtaining registration
is an escape from official machinery, paperwork,
costs and rent seeking. For them, it is perhaps “the
art of not being governed”. Registration offers them
little by way of tangible benefits. There are other
MSEs who, upon reaching a minimum size seek
legitimacy and acknowledgement of their existence
to seek benefits or credit for instance, but they too
struggle. While Udyog Aadhaar offers a simple

23 Report of the Expert Committee on Micro, Small and Medium Enterprises (June, 2019) <https://dcmsme.
gov.in/Report%20of%20Expert%20Committee%20on%20MSMEs%20-%20The%20U%20K%20
Sinha%20Committee%20constitutes%20by%20RBI.pdf>
[2025] 1 S.C.R.  637

NBCC (India) Ltd. v. The State of West Bengal & Ors.

mode of registration, it is usually not enough. Often,

more is needed e.g., Shops and Establishments,
PAN, GST, etc. Lack of formalization impacts the
sector in terms of development and also impacts in
availing credit from financial institutions like banks
and in terms of policy making as well as development
interventions. Registration provides information on
nature of business, location, segmentation, etc. In
the absence of a robust system of registration for
capturing information on operational units, new units
and exits, reliance has to be placed on surrogate data
or on national census/ surveys, which are infrequent.
The various avenues available to the MSMEs for
formalization are discussed below:
4.5.1 Registration of Enterprises
i. The Committee deliberated on the lack of
formalization of a large number of MSMEs particularly
in the micro category. The registration requirements
of Indian enterprises is primarily governed by the
First Schedule to the Industrial Development and
Regulation (IDR) Act, 1951. It is mandatory only
for a class of Medium enterprises which are
engaged in the manufacture of goods. The
registration of MSEs and Medium enterprises
engaged in services activities is discretionary.
However, over a period of time, registration has been
an intrinsic part of the development of MSMEs itself.
Having a registration certificate entitles an MSME for
numerous benefits. Particularly after the MSMED Act,
2006, which came into effect from October 2, 2006,
availability of registration certificate has assumed
greater importance.
(emphasis supplied)
14.7 The above-referred extract from the Report of expert committee
clearly indicates that MSME still exists as informal sector
and it is also recognized that “registration offers them little
by way of tangible benefits”. The committee also recognises
that even though simpler modes of registration have been
638 [2025] 1 S.C.R.

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introduced, they are usually not enough. It further suggests

that filing of memorandum provides information on the nature
of business, location, and segmentation so that the regulators
can capture “information on operational units”. Paragraph
4.5.1 also recognises the policy of lack of formalisation and it
is expected that over a period of time filing of memorandum
could be an intrinsic part of development of MSME itself. The
above referred committee report as well as other documents
very clearly establish that at no point of time filing of registration
of MSME was ever considered to be precondition for availing
the dispute resolution remedy under Section 18.
14.8 We have noted three clear features in the statutory regime. To
start with, Section 18 does not use the expression supplier,
instead employs the phrase, “any party to a dispute, may”. We
have also noted that the definition of the expression ‘supplier’ is
not confined to a micro or a small enterprise which has filed a
memorandum under Section 8(1) but also includes companies
or other entities engaged in selling goods or rendering services
by an enterprise. Thirdly, Section 8 grants a discretion to a
micro or a small enterprise in filing a memorandum with the
authority.
14.9 Further, it is noteworthy that a “micro” [section 2(h)], “small”
[section 2(m)] or “medium enterprises” [section 2(g)], formation
and existence is simply on the basis of their investment as
provided in Section 7 relating to classification of an Enterprise.
They subsist without any formal “recognition”, “consent”
or “registration”. The Act uses the expression filing of a
“memorandum”. That is all. That too, at the discretion of the
micro and small enterprises. The cumulative account of these
four features is compelling and leads us to the conclusion that
an application by a micro or a small enterprise to the Facilitation
Council under Section 18 cannot be rejected on the ground
that the said enterprise has not registered itself in Section 8.
15. Having considered the definition of the expression ‘supplier’,
and also having considered the classification of enterprises into
micro, small and medium with respect to each of which there is a
separate legal regime to be suggested by the Advisory Committee
and notified by the Central and State Governments, and in view
[2025] 1 S.C.R.  639

NBCC (India) Ltd. v. The State of West Bengal & Ors.

of the discretion specifically vested with the micro and small

enterprises for filing a memorandum under Section 8 of the Act,
the submission that the Facilitation Council cannot entertain a
reference under Section 18 if the enterprise is not registered under
Section 8 must be rejected.
16. We will now discuss the cases relied on by the appellant.
17. Re: Silpi Industries v. Kerala State Road Transport Corporation:
This is the lead judgment which has given the impression that this
Court has laid down the law that Section 18 cannot be invoked by an
Enterprise if it has not filed a memorandum under Section 8 of the
Act before entering into a contract. However, the issues that arose
for consideration in Silpi Industries are in complete contrast with the
present case. In that case, there were two appeals, and they involved
different facts and circumstances. The short facts in the first appeal
was that the appellants referred the matter to the Facilitation Council
which made an award in favour of the appellant under the Arbitration
and Conciliation Act. The award was challenged under Section 34 and
the same was dismissed. During the pendency of the appeal under
Section 37, the High Court decided a preliminary issue as to whether
the Limitation Act would apply to arbitral proceedings under the
MSME. In the other appeal, the issue that arose before the High
Court was whether there is a right to file a counterclaim in arbitral
proceedings under MSME. The High Court answered both issues in
the affirmative, thus the appeal before this Court in Silpi Industries
(supra). Before considering the appeals, the following two issues
were framed.
(i) Whether the provisions of the Limitation Act, 1963 is applicable
to arbitration proceedings initiated under Section 18(3) of the
Micro, Small and Medium Enterprises Development Act, 2006?
(ii) Whether, counterclaim is maintainable in such arbitration
proceedings?
17.1 On the first issue, this Court held that the Limitation Act applies.
The relevant portion of the order is as under;
“27…Thus, we are of the view that no further elaboration
is necessary on this issue and we hold that the provisions
of the Limitation Act, 1963 will apply to the arbitrations
covered by Section 18(3) of the 2006 Act. We make it
640 [2025] 1 S.C.R.

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clear that as the judgment of the High Court is an order of

remand, we need not enter into the controversy whether
the claims/counterclaims are within time or not. We keep
it open to the primary authority to go into such issues and
record its own findings on merits.”
17.2 On the second issue also, this Court held that the counterclaim
is maintainable. The relevant portion is as under:
“40. For the aforesaid reasons and on a harmonious
construction of Section 18(3) of the 2006 Act and
Section 7(1) and Section 23(2-A) of the 1996 Act,
we are of the view that counterclaim is maintainable
before the statutory authorities under the MSMED
Act.”
17.3 In view of the finding that the Limitation Act will apply to MSME
arbitration and also that a counterclaim is maintainable in an
MSME arbitration, the Court could have disposed of the appeal
as nothing further remained for adjudication and determination.
However, it appears that the respondent seems to have made
an argument that the appellant in the second set of appeals
is not entitled to any relief whatsoever. This argument led to
the court making the following observation in paragraph 41 of
the judgment.
“41…Though, we are of the view that counterclaim
and set-off is maintainable before the statutory
authorities under the MSMED Act, the appellant in
this set of appeals is not entitled for the relief, for
the reason that on the date of supply of goods and
services the appellant did not have the registration
by submitting the memorandum as per Section 8 of
the Act….”
17.4 This fact led to the Court rejecting the claim of the appellant
therein that there were no supplies after the registration under
Section 8 of the Act. The relevant portion of the order of the
judgment is as under;
“42. Though the appellant claims the benefit of provisions
under the MSMED Act, on the ground that the appellant
[2025] 1 S.C.R.  641

NBCC (India) Ltd. v. The State of West Bengal & Ors.

was also supplying as on the date of making the claim,

as provided under Section 8 of the MSMED Act, but same
is not based on any acceptable material. The appellant,
in support of its case placed reliance on a judgment of
the Delhi High Court in GE T&D India Ltd.,24 but the said
case is clearly distinguishable on facts as much as in the
said case, the supplies continued even after registration
of entity under Section 8 of the Act. In the present case,
undisputed position is that the supplies were concluded
prior to registration of supplier. The said judgment of the
Delhi High Court relied on by the appellant also would
not render any assistance in support of the case of the
appellant. In our view, to seek the benefit of provisions
under the MSMED Act, the seller should have registered
under the provisions of the Act, as on the date of entering
into the contract. In any event, for the supplies pursuant to
the contract made before the registration of the unit under
provisions of the MSMED Act, no benefit can be sought
by such entity, as contemplated under the MSMED Act.
43. While interpreting the provisions of Interest on
Delayed Payments to Small Scale and Ancillary Industrial
Undertakings Act, 1993, this Court, in the judgment in
Shanti Conductors25 has held that date of supply of goods/
services can be taken as the relevant date, as opposed
to date on which contract for supply was entered, for
applicability of the aforesaid Act. Even applying the said
ratio also, the appellant is not entitled to seek the benefit
of the Act. There is no acceptable material to show that,
supply of goods has taken place or any services were
rendered, subsequent to registration of the appellant as
the unit under the MSMED Act, 2006. By taking recourse
to filing memorandum under sub-section (1) of Section 8
of the Act, subsequent to entering into contract and supply
of goods and services, one cannot assume the legal
status of being classified under the MSMED Act, 2006,

24 GE T&D India Ltd. v. Reliable Engg. Projects & Mktg., 2017 SCC OnLine Del 6978.
25 Shanti Conductors (supra).
642 [2025] 1 S.C.R.

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as an enterprise, to claim the benefit retrospectively from

the date on which the appellant entered into contract with
the respondent.
44. The appellant cannot become micro or small enterprise
or supplier, to claim the benefits within the meaning of the
MSMED Act, 2006, by submitting a memorandum to obtain
registration subsequent to entering into the contract and
supply of goods and services. If any registration is obtained,
same will be prospective and applies for supply of goods
and services subsequent to registration but cannot operate
retrospectively. Any other interpretation of the provision
would lead to absurdity and confer unwarranted benefit
in favour of a party not intended by legislation.”
18. In the first place, whether an Enterprise is disabled from seeking a
reference before filing a memorandum under Section 8 for registration
never arose for consideration in Silpi (supra). More importantly, the
Court did not examine any provisions of the Act and their implication
on the right to seek a reference under Section 18 of the Act. This
was natural because the Court did not frame an issue of registration.
On the facts, the Court also held that there was no proof whatsoever
that the appellant had made any supplies as contemplated in the
Shanti Conductors (supra) case. Though we are concerned about
the interpretation of the Act, we may mention at this very stage that
it is an admitted fact that the respondent has, in fact, raised 41 out
of 53 bills after its registration on 19.01.2016.26 Be that as it may, in
view of the above referred analysis, we are of the opinion that Silpi
Industries (supra) is not an authority on the issue that a reference
under Section 18 cannot be made by a micro or small enterprise if
supplies were made or contracts were executed before filing of the
memorandum under Section 8 of the Act.
19. Re: Gujarat State Civil Supplies Corporation Ltd. v. Mahakali
Foods Pvt. Ltd.27 This case considered a batch of appeals which
gave rise to the following questions of law, which were formulated
as under:

26 The complete details regarding bills raised after registration are indicated in paragraph no. 25, page 13
of the counter affidavit filed by the enterprise.
27 [2022] 19 SCR 1094 : (2023) 6 SCC 401
[2025] 1 S.C.R.  643

NBCC (India) Ltd. v. The State of West Bengal & Ors.

“(i) Whether the provisions of Chapter V of the MSMED

Act, 2006 would have an effect overriding the provisions
of the Arbitration Act, 1996?
(ii) Whether any party to a dispute with regard to any
amount due under Section 17 of the MSMED Act, 2006
would be precluded from making a reference to the
Micro and Small Enterprises Facilitation Council under
sub-section (1) of Section 18 of the said Act, if an
independent arbitration agreement existed between the
parties as contemplated in Section 7 of the Arbitration
Act, 1996?
(iii) Whether the Micro and Small Enterprises Facilitation
Council, itself could take up the dispute for arbitration
and act as an arbitrator, when the Council itself had
conducted the conciliation proceedings under sub-section
(2) of Section 18 of the MSMED Act, 2006 in view of the
bar contained in Section 80 of the Arbitration Act, 1996?”
20. It is evident from the above that the substantial question for
consideration that arose for consideration in Mahakali Foods (supra)
was whether the MSME Act overrides the Arbitration and Conciliation
Act, 1996, and such other incidental questions. There was no issue
whatsoever, as has arisen in our case, that is, about the right or rather
a disability to seek a reference under Section 18, if the enterprise
has not filed a memorandum. Answering the issues that have arisen
for consideration, the Court returned the findings in paragraph 52.1
to 52.5 which are as follows:
“52. The upshot of the above is that:
52.1. Chapter V of the MSMED Act, 2006 would override
the provisions of the Arbitration Act, 1996.
52.2 No party to a dispute with regard to any amount
due under Section 17 of the MSMED Act, 2006 would be
precluded from making a reference to the Micro and Small
Enterprises Facilitation Council, though an independent
arbitration agreement exists between the parties.
52.3. The Facilitation Council, which had initiated the
conciliation proceedings under Section 18(2) of the MSMED
644 [2025] 1 S.C.R.

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Act, 2006 would be entitled to act as an arbitrator despite

the bar contained in Section 80 of the Arbitration Act.
52.4. The proceedings before the Facilitation Council/
institute/centre acting as an arbitrator/Arbitral Tribunal
under Section 18(3) of the MSMED Act, 2006 would be
governed by the Arbitration Act, 1996.
52.5. The Facilitation Council/institute/centre acting as an
Arbitral Tribunal by virtue of Section 18(3) of the MSMED
Act, 2006 would be competent to rule on its own jurisdiction
as also the other issues in view of Section 16 of the
Arbitration Act, 1996.
21. The Court also reached another conclusion in paragraph 52.6, which
is as follows:
52.6. A party who was not the “supplier” as per the definition
contained in Section 2(n) of the MSMED Act, 2006 on the
date of entering into contract cannot seek any benefit as the
“supplier” under the MSMED Act, 2006. If any registration
is obtained subsequently the same would have an effect
prospectively and would apply to the supply of goods and
rendering services subsequent to the registration.”
22. Something similar to the decision in Silpi Industries (supra) transpired
in Mahakali Foods (supra) as well. Even though the issue of
registration did not arise, a submission was made to the following
effect.
“49. One of the submissions made by the learned counsel
for the buyers was that if the party supplier was not the
“supplier” within the meaning of Section 2(n) of the MSMED
Act, 2006 on the date of the contract entered into between
the parties, it could not have made reference of dispute
to Micro and Small Enterprises Facilitation Council under
Section 18(1) of the MSMED Act, 2006 and in such cases,
the Council would not have the jurisdiction to decide the
disputes as an arbitrator.”
23. In view of the above submission, the Court proceeded to rely on
Silpi Industries (supra), and allowed the prayer. The relevant portion
is as under: -
[2025] 1 S.C.R.  645

NBCC (India) Ltd. v. The State of West Bengal & Ors.

“50. At this juncture, very pertinent observations made

by this Court in Silpi Industries case 28 on this issue are
required to be reproduced ….
51. Following the abovestated ratio, it is held that a
party who was not the “supplier” as per Section 2(n) of
the MSMED Act, 2006 on the date of entering into the
contract, could not seek any benefit as a supplier under
the MSMED Act, 2006. A party cannot become a micro or
small enterprise or a supplier to claim the benefit under the
MSMED Act, 2006 by submitting a memorandum to obtain
registration subsequent to entering into the contract and
supply of goods or rendering services. If any registration
is obtained subsequently, the same would have the effect
prospectively and would apply for the supply of goods and
rendering services subsequent to the registration. The
same cannot operate retrospectively. However, such issue
being jurisdictional issue, if raised could also be decided
by the Facilitation Council/Institute/Centre acting as an
Arbitral Tribunal under the MSMED Act, 2006.”
24. It is evident from the above that even in Mahakali Foods (supra),
the issue which has arisen for our consideration never arose. There
was neither an issue, discussion, nor analysis on the applicability
of Section 18 for enterprises that have not filed a memorandum.
The decision in Mahakali Foods (supra) is certainly an authority
on the issues that were formulated in paragraph 11 of the said

28 “42. … In our view, to seek the benefit of provisions under the MSMED Act, the seller should have
registered under the provisions of the Act, as on the date of entering into the contract. In any event, for
the supplies pursuant to the contract made before the registration of the unit under provisions of the
MSMED Act, no benefit can be sought by such entity, as contemplated under MSMED Act.
43. While interpreting the provisions of Interest on Delayed Payments to Small Scale and Ancillary
Industrial Undertakings Act, 1993, this Court, in the judgment in Shanti Conductors (P) Ltd. v. Assam SEB
[Shanti Conductors (P) Ltd. v. Assam SEB, (2019) 19 SCC 529 : (2020) 4 SCC (Civ) 409] has held that date
of supply of goods/services can be taken as the relevant date, as opposed to date on which contract for
supply was entered, for applicability of the aforesaid Act. Even applying the said ratio also, the appellant is
not entitled to seek the benefit of the Act. … By taking recourse to filing memorandum under sub-section (1)
of Section 8 of the Act, subsequent to entering into contract and supply of goods and services, one cannot
assume the legal status of being classified under the MSMED Act, 2006, as an enterprise, to claim the
benefit retrospectively from the date on which appellant entered into contract with the respondent.
44. The appellant cannot become micro or small enterprise or supplier, to claim the benefits within the
meaning of the MSMED Act 2006, by submitting a memorandum to obtain registration subsequent to
entering into the contract and supply of goods and services. If any registration is obtained, same will be
prospective and applies for supply of goods and services subsequent to registration but cannot operate
retrospectively. Any other interpretation of the provision would lead to absurdity and confer unwarranted
benefit in favour of a party not intended by legislation.”
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judgment, which have already been extracted hereinabove. Even the

concluding paragraph in Mahakali Foods (supra) clearly establishes
the fact that the Court was only considering the issue of whether
the MSMED Act, being a special legislation, overrides the Arbitration
Act or not. The relevant portion of the judgement is as under: -
“77. The issues raised and the submissions made by the
learned counsel appearing for the appellant with regard
to the overriding effect of the MSMED Act, 2006 over the
Arbitration Act, 1996, jurisdiction of Facilitation Council,
the parties autonomy to enter into an agreement qua
the statutory provisions, the issue of casus omissus, etc.
have been discussed and decided hereinabove which
need not be reiterated or repeated. Accordingly, it is held
that the reference made to the Facilitation Council would
be maintainable in spite of an independent arbitration
agreement existing between the parties to whom the
MSMED Act, 2006 is applicable, and such Council would be
entitled to proceed under sub-section (2) of Section 18 of
the MSMED Act, 2006 as also to act as an arbitrator or to
refer the disputes to the institution or centre as contemplated
under Section 18(3) of the MSMED Act, 2006. As held
earlier, such Facilitation Council/Institute/Centre acting as
an Arbitral Tribunal would have the jurisdiction to rule over
on its own jurisdiction as per Section 16 of the Arbitration
Act, 1996. In that view of the matter, the present appeal also
deserves to be dismissed and is, accordingly, dismissed.”
25. Apart from Silpi Industries (supra), Mahakali Foods (supra),
Mr. Sankaranarayanan also relied on two orders of this Court in
Vaishno Enterprises v. Hamilton Medical AG and Anr.29 and M/s Nitesh
Estates Ltd. v. Micro and Small Enterprises Facilitation Council of
Haryana & Ors.30. These short orders do not lay down the law but
follow the decision of this Court in Silpi Industries (supra).
26. In Vaishno (supra), the contract was entered into on 24.08.2020, but
as the registration was made on 28.08.2020, the Court held that the
appellant was not an MSME and, therefore, the Act will not apply. The
order seems to have been made in the facts and circumstances of

29 [2022] 1 SCR 771 : 2022 SCC OnLine SC 355

30 C.A. No. 5276/2022@ SLP (C) No. 26682/2018
[2025] 1 S.C.R.  647

NBCC (India) Ltd. v. The State of West Bengal & Ors.

the case. There was neither an issue about the supply of goods nor a
formulation of the question as to whether the filing of a memorandum
is mandatory for invocation of reference under Section 18.
26.1 The order in Nitesh Estates (supra), also relied on, observed that
the issue involved is squarely covered against the respondents in
view of the decision in Silpi Industries (supra) holding that filing of
a memorandum is mandatory for initiation of proceedings under
Section 18.
27. A decision where the issue was neither raised nor preceded by any
consideration, in State of U.P. v. Synthetics and Chemicals Ltd.31 this
Court held, “the Court did not feel bound by earlier decision as it was
rendered without any argument, without reference to the crucial words
of the rule and without any citation of the authority”. Further, approving
the decision of this Court in Municipal Corporation of Delhi v. Gurnam
Kaur 32 which held that “precedents sub-silentio and without argument
are of no moment” this Court held that, “a decision which is not express
and is not founded on reasons nor it proceeds on consideration of
issue cannot be deemed to be a law declared to have a binding effect
as is contemplated by Article 141”. The same approach was adopted
in Arnit Das v. State of Bihar33 where it was held that “a decision not
expressed, not accompanied by reasons and not proceeding on a
conscious consideration of an issue cannot be deemed to be a law
declared to have a binding effect as is contemplated by Article 141.
That which has escaped in the judgment is not the ratio decidendi.
This is the rule of sub-silentio, in the technical sense when a particular
point of law was not consciously determined”.
28. In this context, it is also important to note that, as an institution, our
Supreme Court performs the twin functions of decision-making and
precedent-making. A substantial portion of our jurisdiction under
Article 136 is reflective of regular appellate disposition of decision
making. Every judgment or order made by this Court in disposing
of these appeals is not intended to be a binding precedent under
Article 141. Though the arrival of a dispute for this Court’s
consideration, either for decision-making or precedent-making is at
the same tarmac, every judgment or order which departs from this

31 [1991] 3 SCR 64 : (1991) 4 SCC 139

32 [1988] Supp. 2 SCR 929 : (1989) 1 SCC 101
33 [2000] Supp. 1 SCR 69 : (2000) 5 SCC 488
648 [2025] 1 S.C.R.

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Court lands at the doorstep of the High Courts and the subordinate
courts as a binding precedent. We are aware of the difficulties that
High Courts and the subordinate courts face in determining whether
the judgment is in the process of decision-making or precedent-
making, particularly when we have also declared that even an obiter
of this Court must be treated as a binding precedent for the High
Courts and the courts below. In the process of decision making, this
Court takes care to indicate the instances where the decision of the
Supreme Court is not to be treated as precedent.34 It is therefore
necessary to be cautious in our dispensation and state whether a
particular decision is to resolve the dispute between the parties and
provide finality or whether the judgment is intended to and in fact
declares the law under Article 141.
29. Conclusion and reference to larger Bench: On the interpretation
of the provisions of the Act we have arrived at a clear opinion and
have expressed the same. Though it is possible for us to follow the
precedents referred to in para 27 to arrive at the conclusion that the
judgments in the case of Silpi Industries (supra) and Mahakali Foods
(supra) coupled with the subsequent orders in Vaishno Enterprises
(supra) and M/s Nitesh Estates (supra) cannot be considered to be
binding precedents on the issue that has arisen for our consideration,
taking into account the compelling need to ensure clarity and certainty
about the applicable precedents on the subject, we deem it appropriate
to refer this appeal to a three Judge Bench.
30. The Registry is directed to place the appeal paperbooks along with
our detailed judgment before the Hon’ble Chief Justice of India for
constitution of an appropriate Bench.

Result of the case: Referred to three Judges Bench.

†
Headnotes prepared by: Ankit Gyan

34 Union of India v. All Gujarat Federation of Tax Consultants (2006) 13 SCC 473; Francis Stanly v.
Intelligence Officer, Narcotic Control Bureau, Thiruvananthapuram (2006) 13 SCC 210; Bharat Petroleum
Corporation Ltd. v. P. Kesavan (2004) 9 SCC 772; Vishnu Dutt Sharma v. Manju Sharma (2009) 6 SCC
379; Chandigarh Housing Board v. Narinder Kaur Makol (2000) 6 SCC 415; Also refer to the commentary
citing catena of judgements where this Court has enumerated the ‘events when decision-making is not
to be treated as a precedent’ in Durga Das Basu, ‘Commentary on Constitution of India’ (9th Edition,
Vol. IX), page 9858; See also, Allen v. Flood, (1893) AC 1 “a case is only an authority for what it actually
decides”.