The Lawyer's Digest: Supreme Court Judgments passed in November 2020

The Lawyer's Digest is a collection of concise summaries of all the judgments passed by the Supreme Court of India over the course of a month.

Topics have been sub-divided into areas of law including arbitration, criminal law, consumer law, service and administrative law, etc. for ease of reading.

Here are the summaries of judgments passed in November 2020.

Arbitration

Noy Vallesina Engineering SpA, (now known as Noy Ambiente S.p.a) v. Jindal Drugs Limited and Others,

Coram: Justices Indira Banerjee and S Ravindra Bhat

The Court held that a petition under Section 34 of the Arbitration and Conciliation Act 1996 could not be maintained against a foreign award.

Following paragraphs 76 and 123 in Government of India v. Vedanta 2020 SCC Online SC 749, the Bench held that “Having regard to the precedential unanimity, so to say, about the manner of applicability of BALCO in respect of agreements entered into and awards rendered earlier, with respect to the law of the seat of arbitration (or the curial law) excluding applicability of Part I of the Act, and the unambiguous intention of the parties in the present case (expressed in Clause 12.4.2) that the seat of arbitration was London, where the ICC arbitration proceedings were in fact held, and the awards rendered, this court is of the opinion that…” no petition under Section 34 was maintainable as Part I of the 1996 Act stood excluded.

The Bench also held that the Respondent/Jindal’s appeal against the enforcement order under Section 48 of the 1996 Act was not maintainable due to Section 50 of the 1996 Act. [Key Words: Bhatia International v. Bulk Trading (2002) 4 SCC 105, Venture Global Engineering v. Satyam Computer Services (2008) 4 SCC 190, BALCO v. Kaiser Aluminum (2012) 9 SCC 552, Roger Shashoua (2017) 14 SCC 722, BGS SOMA JV (2020) 4 SCC 234, Imax Corporation]

Criminal Law

Jayantilal Verma v. State of MP (Now Chhattisgarh)

Coram: Justices SK Kaul and Hrishikesh Roy

The Court upheld the conviction of the appellant accused under Section 302 r/w Section 34 of the Indian Penal Code 1860 (“IPC”). The Court noted that although the prosecution evidence relied only on the testimony of PW-1 and the medical evidence, while the other witnesses had turned hostile, the testimony of PW-1 had remained consistent and cogent.

The Court also observed that the medical reports indicated that the deceased wife of the appellant had died from asphyxiation and also showed injury marks on her face.

The appellant, the Court said, had failed to give a plausible explanation regarding the cause of death in his statement recorded under Section 313 of the Code of Criminal Procedure (CrPC) and that mere denial would not suffice. The Court relied on Trimukh Maroti Kirkan [(2006) 10 SCC 681] to note that the facts created a strong circumstance indicating that the appellant was responsible for commission of the crime.

Arnab Manoranjan Goswami v. The State of Maharashtra & Others,

Coram: Justices DY Chandrachud and Indira Banerjee

The Bench held that the High Court misdirected itself since it failed to even evaluate whether the allegation in the FIR, prima facie, brought the case within the fold of Section 306 r/w Section 34 of the IPC.

Thereafter, the Bench examined the ingredients of Section 306 IPC and abetment under Section 107 IPC. The Bench held that while considering an application for bail under Section 226, a High Court ought to consider the following factors:

i. The nature of the alleged offence, the nature of the accusation and the severity of the punishment in the case of a conviction;

ii. Whether there exists a reasonable apprehension of the accused tampering with the witnesses or being a threat to the complainant or the witnesses;

iii. The possibility of securing the presence of the accused at the trial or the likelihood of the accused fleeing from justice;

iv. The antecedents of and circumstances which are peculiar to the accused;

v. Whether prima facie the ingredients of the offence are made out, based on the allegations as they stand, in the FIR; and

vi. The significant interests of the public or the State and other similar considerations.

The Court then observed that the Supreme Court’s doors could not “be closed to a citizen who is able to establish prima facie that the instrumentality of the State is being weaponized for using the force of criminal law” and further that the courts “must ensure that they continue to remain the first line of defense against the deprivation of the liberty of citizens” as “deprivation of liberty even for a single day is one day too many”.

Jatinderveer Arora v. Punjab,

Coram: Justice Hrishikesh Roy

An application was filed for the transfer of trial proceedings as the accused apprehended that they would not obtain a fair trial in the state of Punjab. The Court held that the apprehension of not getting a fair and impartial trial cannot be founded on grievances or convenience of the accused but that the reasons have to be more compelling.

Responding to allegations by the accused that there was a surcharged atmosphere against them, the Court held that such allegations are not met as the accused were out on bail in Punjab and continue to reside at their usual place and are going about their routine affairs. Moreover, the Court noted the fact that the alleged incidents of sacrilege involving the Sikh holy book happened in 2015 and that it has been more than 2 years since the petitioners had been arrayed as accused.

During this long period, as no complaint had been made by the petitioners of any threat to their security, inference had to be drawn against their transfer plea.

Regarding the murder of one of the co-accused in jail, the Court noted that he was murdered by jail inmates undergoing life imprisonment and as trial had commenced in that murder, it could not be said whether this had a link with the others or was a standalone event. The Court also held that in the cases involving the petitioners, one was at the stage of final arguments and five were at the stage of evidence or charge and therefore it would not be fair to the prosecution, the State or the witnesses to transfer the proceedings without compelling reasons.

M/s Fertico Marketing and Investment Pvt. Ltd and Ors. Etc v. Central Bureau of Investigation and Another Etc

Coram: Justices AM Khanwilkar, BR Gavai

The appeals arose challenging the order of the single judge of the High Court rejecting the appellants’ petitions under Section 482 CrPC for quashing the charge-sheet against the appellants filed under Section 120B read with Section 420, Sections 467, 468 and 471 of the IPC filed by the Respondent.

The Court referred to the notification dated June 15, 1989 issued by the Government of Uttar Pradesh. The notification accorded consent to the extension of powers and jurisdiction of the members of the Delhi Special Police establishment under Section 6 of the Delhi Special Police Establishment Act 1946, in the whole of Uttar Pradesh for investigation of offences punishable under the Prevention of Corruption Act 1988 subject to the condition that no investigation shall be taken up in cases relating to the public servants under the control of the Government of Uttar Pradesh.

The Court held that the members of the CBI had all the powers and jurisdiction for filing FIR against the private appellants. With respect the appellant-public servants, the Court noted that although consent from the State government was obtained post facto, after the registration of the FIR, the same would not vitiate the proceedings as held in HN Rishbud and Inder Singh [1955] 1 SCR 1150].

The Court also adverted to the fact that the appellants had neither pleaded that such the non-obtaining of prior consent under Section 6 of the DPSE Act caused them prejudice nor contended that it caused miscarriage of justice. The Court noted that the High Court had omitted to answer questions 2-4 framed by it and remanded the matter for consideration afresh.

Omanakkuttan & Ors. vs State of Kerala,

Coram: Justices Ashok Bhushan, R Subhash Reddy

The Court after considering that the incident having occurred in 2002 and the 3^rd appellant having already served more than 2 years of his sentence, saw it fit to modify the sentence imposed for the offence under Section 308 read with Section 34 IPC and also under Section 326 IPC from three years of rigorous imprisonment to the period already undergone and fine imposed from Rs. 25,000 to Rs.5000 to the paid to PW-1.

Skoda Auto Volkswagen India Pvt Ltd v. Uttar Pradesh

Coram: CJI SA Bobde and Justices AS Bopanna and V Ramasubramanian

This was an appeal by Skoda against an Allahabad High Court order which had dismissed a plea for quashing FIRs filed against the petitioner under Sections 34, 471, 468, 467, 420, 419 IPC.

The Petitioner was a company formed by the amalgamation of three companies, Skoda Auto India, Volkswagen India, and Volkswagen Group Sales India (all private limited companies). The Automative Research Association of India had issued a notice to these three companies asking why it should not be concluded that the vehicles manufactured and sold by them in India were in violation of the requirements of the Central Motor Vehicles Rules and alleging that the companies had installed ‘defeat devices’ in their Diesel EA 189 Engines.

Subsequently, a complaint was filed against the petitioner alleging that the complainant had bought 7 cars from the authorized dealers of the manufacturing companies and that at the time of purchase, he got it clarified from the companies that they had not installed any cheat devices. But Indian authorities had later found out higher emissions of NOx and the National Green Tribunal had also imposed a fine on the company.

Therefore among other things, it was claimed that the manufacturing companies had prepared wrong documents and were guilty of various offences under the IPC.

The Supreme Court held that though the order of the NGT was passed on applications filed by individuals who were not purchasers, the same would not be an impediment for individual purchasers to lodge complaints based on any sufferings owing to representation by manufacturers. It, therefore, refused to quash the FIR.

Venkatesan Balasubramaniyan v. The Intelligence Officer, D.R.I Bangalore

Coram: Justices Ashok Bhusan, R Subash Reddy, MR Shah

The appellants were aggrieved by the order passed by the High Court under Section 439 (2) CrPC cancelling the bail granted to them under Section 167 (2) CrPC by the Metropolitan Sessions Judge, Hyderabad.

The Supreme Court observed that bail was granted under Section 167 (2) CrPC as the trial court was not informed of the combined complaint under Section 36A (1) (d) of the Narcotic Drugs and Psychotropic Substances Act 1985 (NDPS Act) for offences under Section 21(c), 22(c), 23(c), 28 and 29 read with Section 38 of the NDPS Act.

The Court adverted to its judgment in Pandit Dnyanu Khot [(2008) 17 SCC 745] wherein it was held that a bail granted under Section 167 CrpC could be cancelled under Section 439 CrPC and, therefore, dismissed the appeals.

Hitesh Verma v. The State of Uttarakhand & Anr.

Coram: Justices L Nageswara Rao, Hemant Gupta, Ajay Rastogi

This was a challenge against a High Court order rejecting a plea to quash charge sheet and summoning order under Section 482 CrPC.

The case pertained to offences under Sections 452, 504, 506 IPC and S. 3(1)(x) and 3(1)(e) of the SC and ST (Prevention of Atrocities) Act, 1989 (SC/ST Act).

The Supreme Court held that insulting or intimidating a person belonging to Scheduled Caste or Scheduled Tribe (SC/ST) community will not by itself amount to an offence under the SC and ST (Prevention of Atrocities) Act unless such insult or intimidation is on account of victim belonging to SC/ST community.

Further, it was also held that one of the ingredients of the offence that such insults should be in public view was also not made out.

In the present case, it was an accepted fact that the scene of action happened inside the four walls of the house of the respondent with no members of the public, the Court held.

It, therefore, quashed the charge-sheet filed specifically for offence under Section 3(1)(r) of the SC/ST Act, while leaving it open for the police to investigate the appellant under other IPC offences.

Rajesh @ Sarkari & Anr. v. State of Haryana

Coram: Justices DY Chandrachud, Indu Malhotra, Indira Banerjee

The case involved conviction of the appellant under Section 302 of IPC, and a consequent imprisonment for life. Relying on Gurucharan Singh [(1963) 3 SCR 585] and Jugraj Singh [(2002) 3 SCC 234], the Court held that there is no inflexible rule which requires the prosecution to examine a ballistics examiner in every case where a murder is alleged to have been caused with the use of a fire arm, particularly where the direct evidence is of unimpeachable character.

On the issue whether adverse inference could be drawn against the accused for refusal to undergo a test identification parade, it was held that the finding of guilt cannot be based purely on the refusal of the accused to undergo an identification parade. The appellant was, therefore, acquitted since it was held that the prosecution could not prove its case beyond reasonable doubt.

Shatrughna Baban Meshram v. State of Maharashtra

Coram: Justices UU Lalit, Indu Malhotra, Krishna Murari

This was a case of death penalty for rape a murder of a two-year-old child. The

The Court reiterated that the Criminal Law (Amendment) Act, 2013 introduced Section 376A, which additionally prescribed death sentence if a fatal injury was caused during the commission of an offence under Section 376(1) or (2), or imprisonment for not less than 20 years, which may extend to life.

However, in this case, the offence was committed on February 11, 2013, when the ordinance was in force. The subsequent Amendment Act was given a retrospective effect from February 3, 2013. The question was whether an ex post facto prescription would be consistent with Article 20(1) of the Constitution.

The Court held in the negative. On a detailed conspectus of evidence, it was found that the accused was guilty of committing the acts of rape and sexual assault upon the victim, and in the process, causing an injury that resulted in her death.

On the question of conviction under Section 302, it was held that the guiding principles were summed up in Ram Prasad [(2014) 9 SCC 392] to the effect that even if there be no intention to cause death, “if there is such callousness towards the result and the risk taken is such that it may be stated that the person knows that the act is likely to cause death or such bodily injury as is likely to cause death”, clause 4 of Section 300 IPC will get attracted and that the offender must be taken to have known that he was running the risk of causing the death or such bodily injury as was likely to cause death of the victim. The said ratio was held to be squarely applicable in the present case.

On the question of sentence, it was held that merely on account of infraction of Section 235(2) CrPC, the death sentence ought not to be commuted to life imprisonment. Further, death sentence can be awarded even in cases of circumstantial evidence if the same is of unimpeachable character.

However, the Court commuted the death sentence for the offence under Section 376A into rigorous imprisonment for 25 years inter alia on the ground that Section 376A was brought on the statute book just a few days before the commission of the offence. Similarly, for the offence under Section 302 IPC, the death sentence was commuted to life imprisonment on the ground of lack of specific intent so as to bring the case under any of the first three clauses of S. 300 IPC.

Hindustan Unilever Ltd. v. The State of Madhya Pradesh

Coram: Justices L Nageswara Rao, Hemant Gupta, Ajay Rastogi

Proceedings were initiated, on the allegation of adulteration of Dalda Vanaspati ghee, under the Prevention of Food Adulteration Act, 1954, which resulted in conviction of one Nirmal Singh, the nominated person of the appellant company.

The 1954 Act was later repealed, and substituted by the Food Safety and Standards Act 2006. It was argued that since the provisions of the 2006 Act were beneficial to the accused (since only the punishment of fine was retained in the 2006 Act), therefore, he was entitled to such benefits.

Rejecting the said argument, it was held that since the 1954 Act was repealed by way of Section 97 of the 2006 Act, being the repeal and savings clause, which protected the punishments under the 1954 Act, therefore the punishment could be imposed as if the 2006 Act had not been passed. The conclusion was arrived at based, inter alia, on Mohar Singh (AIR 1955 SC 84).

However, since the order of remand by the High Court to the trial court against the company, was passed without giving an opportunity of hearing, as contemplated under Section 401(2) CrPC, the same was set aside.

It was held that clauses (a) and (b) of Section 17 of the 1954 Act made the nominated person, as well as the company guilty of the offences.

The said two clauses were not in the alternative, but conjoint. Therefore, it was held that in the absence of the company, the nominated person could not be convicted, and vice versa.

Tribunals

Madras Bar Association v. Union of India & Another,

Coram: Justices L Nageswara Rao, Hemant Gupta, S Ravindra Bhat

In the challenge mounted to Tribunal, Appellate Tribunal and other Authorities (Qualifications, Experience and other Conditions of Service of Members) Rules, 2020, the Court issued the following directions:

i. The Union of India would constitute a National Tribunals Commission which shall act as an independent body to supervise the appointments and functioning of Tribunals, as well as to conduct disciplinary proceedings against members of Tribunals and to take care of administrative and infrastructural needs of the Tribunals, in an appropriate manner. Till the National Tribunals Commission is constituted, a separate wing in the Ministry of Finance, Government of India shall be established to cater to the requirements of the Tribunals.

ii. Instead of the four-member Search-cum-Selection Committees provided for in Column (4) of the Schedule to the 2020 Rules with the Chief Justice of India or his nominee, outgoing or sitting Chairman or Chairperson or President of the Tribunal and two Secretaries to the Government of India, the Search-cum-Selection Committees should comprise of the following members: (A) CJI or his nominee as the Chairperson, (B) the outgoing Chairman/ Chairperson/ President of the Tribunal in case of appointment of the Chairman/Chairperson/President of Tribunal (or) the sitting Chairman or Chairperson or President of the Tribunal in case of appointment of other members of the Tribunal (or) a retired Judge of the Supreme Court of India or a retired Chief Justice of a High Court in case the Chairman or Chairperson or President of the Tribunal is not a Judicial member or if the Chairman or Chairperson or President of the Tribunal is seeking re-appointment—member; (C) Secretary to the Ministry of Law and Justice, Government of India as member; (D) Secretary to the Government of India from a department other than the parent or sponsoring department to be nominated by the Cabinet Secretary as member; (E) Secretary to the sponsoring or parent Ministry or Department as member without a vote.

iii. Rule 4(2) of the 2020 Rules shall be amended to provide that the Search-cum-Selection Committee shall recommend the name of one person for appointment to each post instead of a panel of two or three persons for appointment to each post. Another name may be recommended to be included in the waiting list.

iv. The Chairpersons, Vice-Chairpersons and the members of the Tribunal shall hold office for a term of five years and shall be eligible for reappointment. Rule 9(2) of the 2020 Rules shall be amended to provide that the Vice-Chairman, Vice-Chairperson and Vice President and other members shall hold office till they attain the age of sixty-seven years.

v. The Union of India shall make serious efforts to provide suitable housing to the Chairman or Chairperson or President and other members of the Tribunals. If providing housing is not possible, the Union of India shall pay the Chairman or Chairperson or President and Vice-Chairman, Vice-Chairperson, Vice President of the Tribunals an amount of Rs. 1,50,000/- per month as house rent allowance and Rs. 1,25,000/- per month for other members of the Tribunals. This direction shall be effective from 01.01.2021.

vi. The 2020 Rules shall be amended to make advocates with an experience of at least 10 years eligible for appointment as judicial members in the Tribunals. While considering advocates for appointment as judicial members in the Tribunals, the Search-cum-Selection Committee shall take into account the experience of the Advocate at the bar and their specialization in the relevant branches of law. They shall be entitled for reappointment for at least one term by giving preference to the service rendered by them for the Tribunals.

vii. The members of the Indian Legal Service shall be eligible for appointment as judicial members in the Tribunals, provided that they fulfil the criteria applicable to advocates subject to suitability to be assessed by the Search-cum-Selection Committee on the basis of their experience and knowledge in the specialized branch of law.

viii. Rule 8 of the 2020 Rules shall be amended to reflect that the recommendations of the Search-cum-Selection Committee in matters of disciplinary actions shall be final and the recommendations of the Search-cum-Selection Committee shall be implemented by the Central Government.

ix. The Union of India shall make appointments to Tribunals within three months from the date on which the Search-cum-Selection Committee completes the selection process and makes its recommendations.

x. The 2020 Rules shall have prospective effect and will be applicable from 12.02.2020, as per Rule 1(2) of the 2020 Rules.

xi. Appointments made prior to the 2017 Rules are governed by the parent Acts and Rules which established the concerned Tribunals. In view of the interim orders passed by the Court in Rojer Mathew, appointments made during the pendency of Rojer Mathew were also governed by the parent Acts and Rules. Any appointments that were made after the 2020 Rules came into force i.e. on or after 12.02.2020 shall be governed by the 2020 Rules subject to the modifications directed in the preceding paragraphs of this judgment.

xii. Appointments made under the 2020 Rules till the date of this judgment, shall not be considered invalid, insofar as they conformed to the recommendations of the Search-cum-Selection Committees in terms of the 2020 Rules. Such appointments are upheld, and shall not be called into question on the ground that the Search-cum-Selection Committees which recommended the appointment of Chairman, Chairperson, President or other members were in terms of the 2020 Rules, as they stood before the modifications directed in this judgment. They are, in other words, saved.

xiii. In case the Search-cum-Selection Committees have made recommendations after conducting selections in accordance with the 2020 Rules, appointments shall be made within three months from today and shall not be subject matter of challenge on the ground that they are not in accord with this judgment.

xiv. The terms and conditions relating to salary, benefits, allowances, house rent allowance etc. shall be in accordance with the terms indicated in, and directed by this judgment.

xv. The Chairpersons, Vice Chairpersons and members of the Tribunals appointed prior to 12.02.2020 shall be governed by the parent statutes and Rules as per which they were appointed. The 2020 Rules shall be applicable with the modifications directed in the preceding paragraphs to those who were appointed after 12.02.2020. While reserving the matter for judgment on 09.10.2020, we extended the term of the Chairpersons, Vice-Chairpersons and members of the Tribunals till 31.12.2020. In view of the final judgment on the 2020 Rules, the retirements of the Chairpersons, Vice-Chairpersons and the members of the Tribunals shall be in accordance with the applicable Rules as mentioned above.

Service Law and Administrative Law

Subash Kumar v. State of Bihar & Ors.

Coram: Justices L Nageswara Rao, Hemant Gupta and Ajay Rastogi

The petitioner moved the top court aggrieved by the order of the Bihar Public Service Commission (BPSC) relegating him to the Bihar Education Service after he had served as member of the Bihar Administrative Service for 15 years.

The BPSC passed the impugned order pursuant to the order of the Supreme Court in another case (Civil Appeal No. 3307) wherein it had clarified and upheld the decision of the High Court in directing BPSC to place the aggrieved party therein, a Baldeo Choudhary in the merit list in the 45^th combined competitive examination held pursuant to advertisement dated 29^th December 2001.

The BPSC had then proceeded to include Baldeo Choudhary in the list as a member of the Bihar Administrative Service and relegate the petitioner to the Bihar Education Service. The Court accepted the petitioner’s submissions that the order of relegation with civil consequences could not have been passed without affording the petitioner an opportunity of hearing and in violation of principles of natural justice and quashed the impugned order.

Manohar Lal Jat v. State of Rajasthan

Coram: Indira Justices Banerjee, Ravindra Bhat

This was an appeal challenging a judgment of the Rajasthan High Court which had held that direct recruits were not entitled to claim seniority over departmental promotees.

The Supreme Court held that under Rule 27(1) of the Rajasthan Commercial Taxes Subordinate Services (General Branch) Rules 1975, seniority of personnel is to be determined on the basis of the date of appointment. Further, the Court held that where the recruitment process was delayed on account of administrative exigencies, those who were hired through an earlier selection process could be granted seniority under Rule 27.

Ram Sharan Maurya v. State of UP

Coram: Justices UU Lalit, Mohan M Shantanagoudar

This was a batch of appeals against a judgment of the High Court of Allahabad which held that Shiksha Mitras could not be treated as teachers in terms of the UP Basic Education (Teachers) Service Rules 1981 as they did not have qualifications prescribed, such as a graduate degree or a basic teachers’ certificate.

However, the Supreme Court had, in Anand Kumar Yadav [(2018) 13 SCC 560] directed that Shiksha Mitras be given certain benefits and considerations. The appellants had challenged the fixation of minimum qualifying marks of 60-65% and eligibility of candidates who had completed B. Ed. Programmes, for the post of Assistant Teachers.

The top court held that as the objective was to select the best available candidate and as the government had the power to fix minimum qualifying marks under the roles, such eligibility conditions and minimum qualifying marks were not illegal. Further, under Rule 2(1)(x) of the UP Basic Education (Teachers) Service Rules 1981, the government had the power to fix minimum marks, from time to time even if the same were issued after the examination had already been conducted, as long as there was no malice.

Chief Manager, Punjab National Bank & Anr. v. Anit Kumar Das

Coram: Justices Ashok Bhushan, R Subhash Reddy and MR Shah

The challenge in this case was to the judgment of the High Court which directed the Bank to confirm the Respondent’s appointment and permit him to discharge his duties as a Peon. The eligibility criteria for the application was that the candidate should have qualified Class 12, but should not be a graduate as on January 1, 2016.

The Respondent was a graduate, and the said fact was not disclosed by him in his application. The Court held that having participated in the recruitment process, it was not open for the Respondent to argue that acquisition of a higher qualification cannot be a disqualification.

Relying on Zahoor Ahmad Rather [(2019) 2 SCC 404], it was further held that it was for the employer and not courts, to consider the relevance of qualifications prescribed for various posts. Lastly, the Court also held that a candidate having suppressed material information cannot claim the right to continuance in service.

DGP RPF v. Rajendra Kumar Dubey,

Coram: Justices DY Chandrachud, Indu Malhotra, KM Joseph

This was a challenge to a judgment of the High Court setting aside an order of compulsory retirement and substituting it by an order of re-instatement with all consequential benefits and 50% back-wages.

The Supreme Court, relying on State of Andhra Pradesh v. S Sree Rama Rao, [AIR 1963 SC 1723] reiterated that under Article 226, the High Court is not a court of appeal over the decision of authorities holding a departmental enquiry and that it is not the Court’s role to review evidence and arrive at an independent finding.

However, High Courts may interfere where the departmental authority held proceedings which are inconsistent with the principles of natural justice or where the findings are based on no evidence, or in violation of statutory rules prescribing mode of enquiry or where the authorities acted on extraneous considerations and failed to reach a fair decision or if the conclusion was so wholly arbitrary and capricious that no reasonable person could ever have arrived at that conclusion.

Second, where gross neglect of duty as regards charges of theft of railway property had been concurrently upheld, the High Court was not justified in re-appreciating evidence as a court of first appeal and substituting the order of punishment by a lesser punishment without justifiable reason. Further, since the Supreme Court upheld the order of compulsory requirement, the Court held that the payment of backwages did not arise.

Election Laws

Tej Bahadur v. Shri Narendra Modi

Coram: CJI SA Bobde and Justices AS Bopanna, V Ramasubramanian

This was a plea challenging the election of Prime Minister Narendra Modi from the Varanasi constituency in the 2019 Lok Sabha elections.

The petitioner, former BSF jawan Tej Bahadur Yadav had tried to contest against Modi but his nomination paper had been rejected by the returning officer.

Yadav had filed an election petition against the same before the Allahabad High Court which had dismissed his plea.

Yadav had prayed for declaring Modi's election void on the ground that the appellant’s nomination was improperly rejected, that the nomination of the respondent was wrongly accepted for want of disclosure of certain facts and that the election was vitiated on account of misuse of official power by the Returning Officer and the Election Observer.

The Supreme Court held that according to Section 81 of the Representation of People Act, an election petition may be presented either by an elector or a candidate at such election. S

Since the appellant was not an elector as he was a registered voter in a different constituency, he would not have the locus to file such petition if he was not a candidate at such election. Further, the candidate did not file his nomination papers with the required certificate stating that he had not been dismissed from service for corruption or disloyalty to the State. Hence, it was ruled that he could not be considered a duly nominated candidate. Therefore, the Court held that he was not entitled to file an election petition under Section 81 of the Act.

Specific Performance, Contract, CPC, Transfer of Property, and Partnership

Kirpa Ram (Deceased) Through Legal representatives & Ors. v. Surendra Deo Gaur & Ors.

Coram: Justices L Nageswara Rao, Hemant Gupta and Ajay Rastogi

The genesis of the dispute lay in a suit for declaration filed by the Respondents which came to be decreed. The Court upheld the judgment of the High Court dismissing the second appeal by the appellant. It stated that the trial court and the appellate court had not in fact treated the issue of jurisdiction as a preliminary issue and the issue of jurisdiction was not in fact raised by the appellant but by defendants 1-3 in a separate written statement.

Therefore, no prejudice was caused to the appellant by not deciding the issue of jurisdiction of the Civil Court in the first instance by the first appellate court. The Court also relied on South Delhi Municipal Corporation & Anr. [2019 SCC OnLine SC 1052] to state that the suit could only be decided by a civil court in the absence of any bar on its jurisdiction either implied or express in terms of Section 9 of the Civil Procedure Code (CPC) and that the Delhi Land Revenue Act 1974 does not bar the jurisdiction of the Civil Court in respect of boundary disputes as contended.

The Court also relied on its decision in Ashok Rangnath Magar [(2015) 16 SCC 763] to state that the High Court is not obliged to frame substantial question of law if it finds no error in the findings recorded by the first appellate court.

Shri Ram Sahu (Dead) Through LRs & Ors. v. Vinod Kumar Rawat & Ors

Coram: Justices Ashok Bhushan, MR Shah

The short question which fell for consideration was whether the High Court was justified in allowing the review application in exercise of powers under Section 114 read with Order 47 Rule 1 of CPC.

Relying on Haridas Das (2006) 4 SCC 78 and Lily Thomas [(2000) 6 SCC 224], the age old principle was reiterated that the power of review can be exercised for correction of a mistake or an error apparent, but not to substitute a view.

Further, the words “any other sufficient reason” in Order 47 Rule 1 CPC must mean a reason sufficient on grounds at least analogous to those specified in the Rule. Lastly, relying, inter alia, on Kamal Sengupta [(2008) 8 SCC 612], it was held that the expression ‘error apparent’ meant a patent error and not a mere wrong decision.

Shanti Devi alias Shanti Mishra v. Union of India & Ors

Coram: Ashok Bhushan, R Subhash Reddy, MR Shah

The challenge in this case was to the dismissal of the petition by the High Court on the ground of lack of territorial jurisdiction itself.

On a detailed conspectus of judgments, including in Utpal Kumar Basu [(1994) 4 SCC 711], Navinchandra N. Majithia [(2000) 7 SCC 640], Kunjan Nair Sivaraman Nair [(2004) 3 SCC 277] and Kusum Ingots [(2004) 6 SCC 254], it was reiterated that even if a small fraction of the cause of action accrues within the territorial jurisdiction of the Court, the Court will have the jurisdiction in the matter.

On facts, it was held that since the deceased Appellant was drawing his pension in his savings account with State Bank of India at Darbhanga (Bihar), stoppage of such pension gave rise to a legitimate cause of action. Therefore, the Patna High Court was held to have the territorial jurisdiction.

Chief Executive Officer and Vice Chairman Gujarat Maritime Board v. Asiatic Industries Ltd

Coram: Justices Indira Banerjee, S Ravindra Bhat

This was an appeal against a judgment of the Gujarat High Court which had allowed a writ petition and directed the Gujarat Maritime Board to refund and pay interest of contract consideration in relation to a tender and subsequent conduct for ship breaking.

Subsequently, the respondents had issued a notice to the appellant stating that it wished to abandon the contract and demanded a refund of payment along with interest. The Court held that a claim for interest had to be decided in light of the conduct of both parties and on what was expected of the Board as a state instrumentality. The Court held that the Board’s conduct in not providing the plot in usable conditions, the Board not being forthcoming with reasons for its inaction, the Board’s complete silence in responding to demands for refund leave it vulnerable to the charge of complete arbitrariness.

Practice and Procedure

Indian Commodity Exchange Limited v. Neptune Overseas Limited

Coram: Justices SK Kaul, Hrishikesh Roy

The dispute pertained to a report of an independent journalist to the Forward Markets Commission (FMC) alleging abuse of position by the respondents.

The Court held that opportunity of hearing is a valuable right and found that conclusion of proceedings within a span of two weeks by the Securities Appellate Tribunal would not be an adequate opportunity. Further, the Court held that where the contents of a show cause notice ran into 150 pages with 4000 pages of supporting documents, a reasonable time has to be given to respond to the same.

The Court held that where respondent 1 had earlier approached the High Court challenging the show cause notice, he could not later contend that said show cause notice was not addressed to him, merely because it was not specifically addressed to him. It, therefore directed that no new show cause notice would have to be issued.

Company Law

M/s Kaledonia Jute and Fibres Pvt. Ltd. v. M/s Axis Nirman and Industries Ltd. & Ors.

Coram: Chief Justice of India SA Bobde, Justices AS Bopanna, V Ramasubramanian

The appellant was aggrieved by the order of the Company Court (High Court) rejecting the appellant’s application seeking the transfer of the winding up petition to the National Company Law Tribunal.

The Court set aside the High Court order and allowed the appeal, considering Section 434 (1)(c) of the Companies Act, 2013.

The Court adverted to its decision in Forech India Limited [2019 (2) SCR 477] wherein it had taken note of the insertion of the 5^th proviso to Section 433(1)(c) by the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018.

The Court considered the use of the words “any party or parties to any proceedings relating to the winding up of companies pending before any Court” in the 5^th proviso and Section 278 of the Companies Act 2013, to note that the proceedings for winding up are proceedings in rem to which the entire body of creditors is a party.

It held that the appellant who was a creditor of the 2^nd Respondent company, although not the petitioner in the winding up petition against it, would still be a party to the proceedings entitled to seek transfer of the proceedings under the 5^th proviso.

Securities and Stock Exchanges

Rusoday Securities Ltd. v. National Stock Exchange of India Ltd. & Ors

Coram: Justices AM Khanwilkar, Dinesh Maheshwari

The Court held that the National Stock Exchange did not require the prior approval of SEBI/GoI for enforcing circular relating to gross exposure limits inasmuch as it fell within the meaning of “operational parameters” of Chapter V of the NSE Bylaws 1994 read with Section 9 of the SCRA 1956.

It was held that the NSE Bylaws was not in conflict with the impugned circular.

In the accompanying civil appeal, it was held that once a trading member had been declared a defaulter, the Exchange was duty bound to realise the security deposits retained by it to satisfy its obligations and return the remaining deposits, if any.

If the Exchange failed to do so, it might become liable to make good the loss of interest to the defaulter on any amount over and above the monetary obligation. There could be no action, either or sale or of registration, against a property unless the property vests in the entity. Unlike money deposits, withheld securities cannot be realised without legal vesting. The act of vesting takes place once a formal expulsion order is passed and that of such an order is the date of vesting. It was reiterated that though the NSE had a discretionary duty, equitable common law principles could be invoked to convert it into a mandatory legal obligation.

Securities and Exchange Board of India v. Udayant Malhotra

Coram: Justices Dr. DY Chandrachud, Indu Marlhotra, Indira Banerjee

This was a statutory appeal under Section 15Z of the Securities and Exchange Board of India Act 1992 (SEBI Act) against the order of the Securities Appellate Tribunal (SAT).

The SAT had set aside an interim order dated 15 June 2020 passed by the Whole Time Member of SEBI under Section 19 read with Sections 11(1), 11(4)(d), 11(4A), 11(5) and 11B of the SEBI Act read with Regulation 10 of the SEBI (Prohibition of Insider Trading) Regulations 2015.

The interim order directed the Respondent to deposit Rs 3.83 crore in an escrow account, the amount being the notional loss on trade carried out by the Respondent. The Court upheld the order of the SAT holding that since the investigation against the Respondent was pending since 2017 and information supplied since 28 November 2019, there was no urgency for passing an ex-parte interim order.

The Court, however, clarified the SAT’s interpretation of Section 11 (4) of the SEBI Act, stating that “no amount towards disgorgement can be directed to be deposited in advance unless it is adjudicated and quantified unless there is some evidence to show and justify the action taken” shall not cited as precedent in any other case.

Taxation

M/s Tamil Nadu State Marketing Corporation Ltd v. Union of India

Coram: Justices Ashok Bhushan, R Subhash Reddy, MR Shah

This was an appeal against a judgment of the Madras High Court by which the High Court had dismissed a writ petition challenging the validity of Section 40(a)(iib) of the Income Tax Act 1961.

The Supreme Court held that when the appellant approached the High Court and assailed the validity of this provision, the High Court ought to have decided such challenge to the vires of the provision and that the High Court had erred by not deciding the challenge on merits.

Land Laws

BK Ravichandra v. Union of India

Coram: Indira Banerjee, Ravindra Bhat

This was an appeal against the Karnataka High Court's judgment rejecting appellant’s claim to direct the respondent to vacate their land.

The Union of India had requisitioned properties belonging to the predecessor of the appellants under the Defence of India Act 1962 (DOI). While their predecessor handed over possession of the suit lands under protest, they were taken over under Section 30 DoI, the approval for compensation was given in 1968 and the land was requisitioned till 1987.

The Court held that the legal effect of requisitioning immovable property is temporary, and that while the title remains undisturbed, the owner loses possessory rights for the period during which the requisition order is in operation.

The Court also stressed on the importance of Article 300-A of the Constitution and relying on T Vijayalakshmi v. Town Planning Member [(2006) 8 SCC 502] held that any law which involves the deprivation of property should be explicit about nature and effect of such deprivation, and express the intention to do so. The Court also held that with the lapse of the Requisitioning Act in 1987, requisitions made under it would cease to be lawful with such lapse. Therefore, the Court directed the Union to hand over possession of the suit lands to the appellants within 3 months, and gave leave to the appellants to seek compensation based on fresh fixation of capital value and recurring annual value.

SARFAESI

C Bright v. The District Collector & Ors

Coram: Justices L Nageswara Rao, Hemant Gupta, Ajay Rastogi

The challenge was to a judgment which had held that Section 14 of the SARFAESI Act, 2002, mandating the District Magistrate to deliver possession of a secured asset within 30 days, extendable to an aggregate of 60 days upon reasons recorded in writing, is a directory provision.

The Supreme Court held that the use of the word “shall” in a statute does not necessarily mean that in every case it is mandatory that unless the words of the statute are literally followed, the proceeding would be invalid. Similarly, it is not always correct to say that if the word “may” has been used, the statute is only permissive or directory in the sense that non-compliance with those provisions will not render the proceeding invalid.

Relying on Constitution Bench judgments in Dattatraya Moreshwar Pangarkar [(AIR 1952 SC 181)] and Hari Vishnu Kamat [(AIR 1955 SC 233)], it was further held that when the provisions of a statute relate to the performance of a public duty, the practice of the courts should be to hold such provisions as directory.

Blacklisting

Vetindia Pharmaceuticals Ltd. v. State of U.P. & Anr

Coram: Justices RF Nariman, Navin Sinha, Krishna Murari

The appellant in this case was aggrieved by an indefinite order of blacklisting. The High Court had dismissed the petition in limine on the ground of delay of 10 years.

The Court set aside the order of blacklisting and relying upon Gorkha Securities [(2014) 9 SCC 105], held that the show cause notice must also reflect the mind of the Respondent to blacklist, since in such event, the appellant could have filed an appropriate response on the said aspect.

Considering the long passage of time, the Court did not remand the matter to the Respondent. It was lastly held that the Writ Court under Article 226 may condone the delay if it is properly explained and no third party rights are affected.

UMC Technologies Pvt Ltd v. Food Corporation of India

Coram: Justices S Abdul Nazeer, BR Gavai

This was an appeal against an order of the Jabalpur High Court dismissing a writ petition and upholding a validity of an order passed by the respondent to terminate a contract of service appellant and to blacklist the appellant from participating in any future tenders of the FCI for 5 years.

The appellant was a recruitment agency who had been awarded the contract to conduct examinations for aspirants for the post of ‘watchman’. On knowing that the question papers relating to the examination conducted by the appellant had been leaked and a charge sheet had been filed against an employee of the appellant, the FCI had issued a show cause notice and subsequently terminated the contract and blacklisted the appellant.

The Court held that for a State corporation to blacklist an entity, a valid, particularized and unambiguous show cause notice was essential. Relying on Gorkha Security Services [(2014) 9 SCC 105], the Court held that as blacklisting is the equivalent of civil death, the show cause notice must either spell out clearly, or its contents must be such that it can be clearly inferred that the issuer intends to blacklist the noticee.

The Bench noted that given the fact that a blacklisting order entails severe domino effects such as stigmatization which leads up to civil death, it is essential that principles of natural justice be followed before a person/entity is blacklisted. The Court held that first, a mere clause in the bid document mentioning blacklisting as a bar against eligibility would not satisfy the mandatory requirement of a clear mention of the proposed action in the notice and second, that the language used in the notice did not demonstrate an intention to blacklist. Thus, the FCI’s order blacklisting the appellant was quashed.

Family Laws

Rajnesh v. Neha & Anr

Coram: Justices Indu Malhotra, R Subhash Reddy

The Court framed guidelines on certain aspects pertaining to the payment of maintenance in matrimonial matters. At the outset, it held that there was no bar to seeking maintenance under different statutes. However, a party who has been granted maintenance by one court must disclose such grant to the subsequent court under a different statute, and such subsequent court must take into account the maintenance amount already granted by the earlier court.

- Taking into account the judgments passed by the Delhi High Court in Kusum Sharma I [(2014) 214 DLT 493], Kusum Sharma II [(2015) 217 DLT 706], Kusum Sharma III (MANU/DE/2406/2017) and Kusum Sharma IV [(2018) 246 DLT 1], it was directed that an affidavit of disclosure of assets and liabilities be filed by both parties to the maintenance proceedings, including in the pending proceedings, throughout the country (separate for urban and rural areas, as set out in Enclosures I and II of the Judgment).

- The Respondent must file its reply and the aforesaid affidavit within a maximum of four weeks, subject to a maximum of two opportunities.

- In the event false statements are made, the Court may consider initiation of proceedings under Section 340 CrPC or for contempt of court.

- The Court must endeavour to decide the application for interim maintenance within four to six months after the affidavits of disclosure have been filed.

- In order to decide the quantum of maintenance, the Court must adopt a reasonable and realistic approach, so that the wife is able to maintain herself with reasonable comfort, while the amount is not oppressive for the husband.

- Apart from the eleven factors mentioned in Bharat Hegde [(140) 2007 DLT 16], factors like age and employment of the parties, right to residence, whether the wife is earning some income, serious disability or ill health may also be considered.

- Further, the divergent views, as to the date from which the maintenance is to be granted, were consolidated, and it was held that in all cases, maintenance must be granted from the date of application.

- Lastly, it was held that the orders of maintenance must be enforced like a decree of a civil court in terms of Sections 51, 55, 58 and 60 read with Order XXI CPC. Striking off the defence of the defaulting party must be used only as a last resort when the default is found to be wilful and contumacious.

Waqf

State of Tamil Nadu & Anr. v. K Fazlur Rahman & Anr

Coram: Justices Ashok Bhushan, R Subhash Reddy, MR Shah

The issue pertained to a notification dated September 18, 2019 in exercise of powers under Section 99(1) of the Waqf Act, 1995 superseding the Waqf Board.

The Court held that the obligation on the State government to constitute the Waqf Board in accordance with Section 14, keeping in view the objective under Section 14(4), was both the right and the duty of the State, and any lapse therein cannot be a ground for superseding the Board.

It was further held that the objective behind the second proviso to Section 99 was to injunct the State Government from exercising power unless there was a prima facie evidence of financial irregularity, misconduct or violation of the provisions of the Act.

The present not being such a case, it was held that the State could not have exercised its power of supersession of the Board.

Evidence

Rattan Singh & Ors vs Nirmal Gill & Ors

Coram: Justices AM Khanwilkar, Dinesh Maheshwari

The appellants were aggrieved by a judgment of the High Court reversing the concurrent findings of the trial court and the first appellate court.

The Respondent Plaintiff in her suits had prayed for declaration that a GPA executed in her name was obtained by fraud and to also set aside the sale deeds subsequent to such GPA.

The Court observed that the disputed documents being registered documents are to be presumed to be genuine as held in Prem Singh and Ors. [(2006) 5 SCC 353].

Therefore, the onus to disprove such a document was on the Respondent-Plaintiff. The Court noted that High Court erred in rejecting the credible testimony of the PW4 on the ground that he was known to Defendant No.4, while the Plaintiff had not even declared him to be a hostile witness.

The Court also relied on Anil Rishi [(2006) 5 SCC 558] to state that shifting the burden of proof would require more than pleading fiduciary relationship between the parties and the same must be proved by tangible evidence and the Plaintiff had failed to prove misuse of trust by the Defendants.

The Court also held that the High Court had acted beyond the scope of second appeal in disturbing the concurrent finding on fact by the subordinate courts as held in Satya Pal [(1998) 6 SCC 423]. The Court relied on Damodar v. State of Rajasthan [(2004) 12 SCC 336] to state that the courts should not take a hypersensitive approach when there is delay in recording evidence and therefore the failure of the attesting witness in recognizing the plaintiff after 17 years of the execution of the document would not by itself diminish the credibility of his testimony. The Court also noted that fraud and discovery of fraud will both have to be pleaded and proved to invoke Section 17 of the Limitation Act 1963 and since the Respondent Plaintiff had failed to prove fraud, the suits would also be barred by limitation.

The Court, therefore, allowed the appeals and set aside the impugned judgment of the High Court and restored the Judgment of the first appellate court.

Consumer

Imperia Structures Ltd. v. Anil Patani & Anr

Coram: Justices UU Lalit, Vineet Saran

The issue was whether, in respect of the allottees who were “consumers” within the meaning of the Consumer Protection Act (CP Act), the bar specified in Section 79 of the RERA Act would apply to proceedings initiated under the CP Act.

It was reiterated that Section 79 of RERA Act does not in any way bar the fora under the provisions of CP Act to entertain any complaint. The proviso to Section 71(1) of the RERA Act gives an option to the complainant to withdraw the proceedings under the CP Act filed before the RERA Act came into force, but does not statutorily force him to withdraw such complaint.

Further, there is nothing in RERA Act to bar initiation of proceedings under the CP Act, even after the RERA Act has come into force. The remedies under the RERA Act are without prejudice to any other remedy available. This was held on the premise that the fora under the CP Act cannot be called a ‘civil court’.

Covid

Gurusimran Singh Narula v. Union of India & Anr

Coram: Ashok Bhushan, R Subhash Reddy, MR Shah

This was a writ petition under Article 32 seeking a direction to forthwith ban disinfectant tunnels / spraying of all kinds of disinfectants on human beings and exposure to artificial ultraviolet rays which was being done supposedly for protecting human beings from Covid 19.

After taking into account, inter alia, the publications of the World Health Organisation, expert reports and Sections 10 and 36 of the Disaster Management Act, 2005, the Court held that when Union of India had issued an advisory against the use of disinfectants on human body, despite which many public bodies were using the same, it was the duty of the Union of India to issue necessary directions to prevent such use. Accordingly, the Union of India was directed to issue directions to the aforesaid effect within a period of one month

Gajendra Sharma v. Union of India

Coram: Justices Ashok Bhushan, R Subhash Reddy, MR Shah

This writ petition prayed for directions declaring the notification dated March 27, 2020 issued by the Reserve Bank of India as ultra vires to the extent that it charged interest on the loan amount during moratorium period. However, as the Ministry of Finance had issued an order on October 23, 2020 extending the benefit of the moratorium to housing loans upto Rupees 2 Crores, the Court merely directed the Union of India to implement the March 23, 2020 decision and disposed the petition.