Supreme Court Weekly Digest With Subject /Statute Wise Index [April 14 to 20]

SUPREME COURT WEEKLY DIGEST APRIL 2024 PART 2

Citations 2024 LiveLaw (SC) 291 to 2024 LiveLaw (SC) 310

Arbitration and Conciliation Act. 1996

Section 34 & 37- Scope of interference of courts with arbitral awards – A judgment setting aside or refusing to set aside an arbitral award under Section 34 is appealable under Section 37. The jurisdiction under Section 37 is akin to the jurisdiction of the Court under Section 34 and restricted to the same grounds of challenge as Section 34. As per section 37(3) of Arbitration Act, a recourse to Section 37 is the only appellate remedy available against a decision under Section 34 and no second appeal shall lie from an order passed under Section 37. Held, nothing in the section 37(3) takes away the constitutional right under Article 136 to grant Special Leave to Appeal against a decision rendered in appeal under Section 37. This is the discretionary and exceptional jurisdiction of this Court to grant Special Leave to Appeal and it is a third stage at which this court tests the exercise of jurisdiction by the courts acting under Section 34 and Section 37 of the Arbitration Act. (Para 41, 42) Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd., 2024 LiveLaw (SC) 291

Section 34 (2-A) – Grounds for setting aside an arbitral award – A domestic award may be set aside if the Court finds that it vitiated by 'patent illegality' appearing on the face of the award. It is patent illegality, if the decision of the arbitrator is found to be perverse, or so irrational that no reasonable person would have arrived at it; or the construction of the contract is such that no fair or reasonable person would take; or, that the view of the arbitrator is not even a possible view. A 'finding' based on no evidence at all or an award which ignores vital evidence in arriving at its decision would be perverse and liable to be set aside under the head of 'patent illegality'. An award without reasons would suffer from patent illegality. The arbitrator commits a patent illegality by deciding a matter not within his jurisdiction or violating a fundamental principle of natural justice. (Para 40) Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd., 2024 LiveLaw (SC) 291

Central Goods and Services Act, 2017

Section 157 – Defense of 'Good faith' of statutory functionary– A good faith clause, is a provision of immunity to a statutory functionary against prosecution or legal proceedings. This immunity is limited and confined to acts done honestly and in furtherance of achieving the statutory purpose and objective. It is for the court or a judicial body to consider, adjudicate, and determine whether the claim that the action was done in good faith is made out or not depending on the facts and circumstances of each case. Held, observations made by High Court on the principle of good faith, is in the nature of advance rulings. Such tentative opinion of High court, even before the initiation of a suit, prosecution or legal proceeding, will affect the integrity and independence of that adjudication, compromising the prosecution and the defence equally. (Para 8, 9, 10 & 11) State of Gujarat v. Paresh Nathalal Chauhan, 2024 LiveLaw (SC) 295

Code of Criminal Procedure, 1973

Whether prior sanction is mandatory for a Magistrate to forward a complaint against a public servant for investigation as per Section 156(3) CrPC. This issue was referred to a larger bench in 2018 in the case Manju Surana v. Sunil Arora. The issue was of wide relevance and was arising in several matters frequently, an earlier decision on the question referred is solicited. Shamim Khan v. Debashish Chakraborty, 2024 LiveLaw (SC) 305

Constitution of India

Article 20(3) and Narcotics Drugs and Psychotropic Substances Act, 1985; Section 42(1) – Power of search and seizure under Section 41(2) of the NDPS Act 1985, is inherently limited by the recognition of fundamental rights by the Constitution as well as statutory limitations. Article 20(3) of the Constitution would not be affected by the provisions of search and seizure. The statutory provisions conferring authorities with the power to search and seize are a mere temporary interference with the right of the accused as they stand well regulated by reasonable restrictions emanating from the statutory provisions itself. (Para 41) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Article 21 – Right to just and fair trial – Actions of the authorities concerned within the meaning of the NDPS Act 1985 must be towards ensuring of upholding the rights of the accused in order to allow the accused to have a fair trial. (Para 24) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Article 136 – Interference not warranted – The Technical Assistants are not claiming against the 75% posts available for direct recruits. Their claim is only towards 25% posts which are required to be filled in from Junior Draughting Officers, Overseers and Technical Assistants who have put five year service and have acquired B.E./A.M.I.E. qualification. Held, the Technical Assistants are not encroaching upon the quota apportioned for directly recruited Assistant Engineers. The continuation of the appellants as Assistant Engineers would not amount to encroaching upon the 75% posts apportioned for the members of the appellants' association. Hence, any interference at this stage is likely to undo the settled position which has been prevalent almost for a period of last 18 years. (Para 21, 25 & 26) Association of Engineers v. State of Tamil Nadu, 2024 LiveLaw (SC) 304

Article 136 – Scope of interference in arbitral award – While adjudicating the merits of a Special Leave Petition and exercising its power under Article 136, the Supreme Court must interfere sparingly and only when exceptional circumstances exist, justifying the exercise of the Court's discretion. The Supreme Court must be slow in interfering with a judgement delivered in exercise of powers under Section 37 unless there is an error in exercising of the jurisdiction. Held, the judgment of the Division Bench provided more than adequate reasons to come to the conclusion that the arbitral award suffered from perversity and patent illegality. There was no valid basis for interference under Article 136 of the Constitution. (Para 43 & 71) Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd., 2024 LiveLaw (SC) 291

Article 136 – Special leave petition – Interference not required – Findings of the First Appellate Court and the High Court are based on evidence and is not perverse. (Para 11) Rajco Steel Enterprises v. Kavita Saraff, 2024 LiveLaw (SC) 306

Article 142 – Maintainability of the Curative Petition – Test of 'manifest injustice' – The exercise of the curative jurisdiction of this Court should not be adopted as a matter of ordinary course and create a fourth or fifth stage of court intervention in an arbitral award. The Court may entertain a curative petition to (i) prevent abuse of its process; and (ii) to cure a gross miscarriage of justice. The concern of the Court for rendering justice in a cause cannot be considered less important than the principle of finality. There are certain situations, which would require reconsideration of a final judgement even after the review has been dismissed to set right a miscarriage of justice. The interference by Supreme Court by setting aside the judgement of the Division Bench, has resulted in restoring a patently illegal award and has caused a grave miscarriage of justice. Hence, curative petition is allowed applying the standard of a 'grave miscarriage of justice'. (Para 32, 33 & 70) Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd., 2024 LiveLaw (SC) 291

Article 226 – Entertaining petition under Article 226 in case of availability of alternative remedy – The High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an alternate effective remedy is available. This rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. (Para 15) PHR Invent Educational Society v. Uco Bank, 2024 LiveLaw (SC) 294

Article 226 – Exceptions when a petition under Article 226 of the Constitution could be entertained in spite of availability of an alternative remedy – (i) where the statutory authority has not acted in accordance with the provisions of the enactment in question; (ii) it has acted in defiance of the fundamental principles of judicial procedure; (iii) it has resorted to invoke the provisions which are repealed; and (iv) when an order has been passed in total violation of the principles of natural justice. (Para 29) PHR Invent Educational Society v. Uco Bank, 2024 LiveLaw (SC) 294

Article 226 – Power of High court to interfere – Reopening the issue is not allowed under Article 226 – Held, the High Court could have interfered in the confirmed auction sale only in cases of fraud or collusion. As the case is not of fraud or collusion, the effect of the order of the High Court would be again reopening the issues which have achieved finality. (Para 26) PHR Invent Educational Society v. Uco Bank, 2024 LiveLaw (SC) 294

Writ Jurisdiction – Jurisdiction of the Writ Court in entering into fact-finding exercise while testing legality of an award of tribunal – For revision of wages and other facilities, the standard criteria followed by the industrial adjudicator is the 'industry-cum-region test', which implies that the prevailing pay and other allowances should be compared with equally placed or similarly situated industrial units in the same region. To determine comparability of units applying the industry-cum-region test, the financial capacity of the employer would be a strong factor. Held, where the employer contested comparability of the concerned units, on grounds of its financial position, the proper course would have been to remit the matter to the Industrial Tribunal rather than entering into these factual question independently in exercise of the writ jurisdiction. The High Court ought not to re-appreciate evidence and substitute its own finding for that of the Tribunal, it would not be beyond the jurisdiction of the High Court in its power of judicial review to altogether eschew such a process. (Para 12 & 15) VVF Ltd. Employees Union v. VVF India Ltd., 2024 LiveLaw (SC) 299

Contempt of Courts Act, 1971

It is a matter of serious concern that nowadays there has been a profuse misuse of social media platforms on which the messages, comments, articles etc. are being posted in respect of the matters pending in the Court. Though, our shoulders are broad enough to bear any blame or criticism, the comments or posts published in respect of the matters pending in the Court, through social media platforms under the guise of right to freedom of speech and expression, which have the tendency of undermining the authority of the Courts or of interfering with the course of justice, deserves serious consideration. It is very usual that the Judges do react during the course of arguments being made by the lawyers, sometimes in favour of and sometimes against a party to the proceeding. However, that does not give any right or leeway to either of the parties or their lawyers to the proceedings to post comments or messages on the social media distorting the facts or not disclosing the correct facts of the proceedings. The matter is required to be taken up more seriously when any such attempt is sought to be made by the party to the proceedings to cause prejudice to the proceedings or interfere with the course of administration of justice. Aminul Haque Laskar v. Karim Uddin Barbhuiya, 2024 LiveLaw (SC) 292

Easements Act, 1882

Acquiring easementary right under Sale Deed – Easementary right could only be transferred via sale deed if the predecessor-in-interest had acquired or purchased the said property with any easementary right over the rasta in dispute. No evidence has been adduced to prove that, predecessor-in-interest, had perfected easementary rights over the disputed rasta and thus was legally entitled to transfer the same. Hence, failed to prove that easementary right is acquired under the sale deed. (Para 30, 36) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Section 4 – 'Easement' – A right which the owner or occupier of a land possesses for the beneficial enjoyment of his land on the other land which is not owned by him, to do and continue to do something or to prevent and continue to prevent something being done on the said land. The land which is to be enjoyed by the beneficiary is called 'Dominant Heritage' and the land on which the easement is claimed is called 'Servient Heritage'. The easementary right, therefore, is essentially a right claimed by the owner of a land upon another land owned by someone else so that he may enjoy his property in the most beneficial manner. (Para 19) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Section 13 – Acquiring easementary right by necessity – Such easementary right would arise if it is necessary for enjoying the Dominant Heritage. Held, if there is an alternative way to access the Dominant Heritage, which may be a little far away or longer, it demolishes the easement of necessity. Hence, not entitled to any easementary right by necessity. Easementary right under the Sale Deed would not stand extinguished even if the necessity has ceased to exist. (Para 32, 33 & 34) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Section 15 – Acquiring easementary right by prescription – For acquiring any easementary right by prescription, the said right must have been peaceably enjoyed in respect of the servient heritage without any interruption for over 20 years. The use of the term “last many years” is not sufficient to mean that they have been enjoying the same for the last 20 years. The pleadings fail to plead the essential legal requirement for establishing easementary right through prescription, hence, the same cannot be so construed as to impliedly include what actually has not been pleaded. A fact which is not specifically pleaded cannot be proved by evidence as evidence cannot travel beyond the pleadings. (Para 22 & 23) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Evidence Act, 1872

Circumstantial evidence – Proof of case based on circumstantial evidence – Circumstances from which the conclusion of the guilt is to be drawn should be fully established. The accused 'must be' and not merely 'may be' proved guilty before a court can convict the accused. It is not only a grammatical but a legal distinction between 'may be proved' and 'must be or should be proved'. The facts so established should be consistent only with the guilt of the accused. Suspicion, however strong it may be, cannot take the place of proof beyond reasonable doubt. An accused cannot be convicted on the ground of suspicion, and is presumed to be innocent unless proved guilty beyond a reasonable doubt. Held, chain of circumstances as complete as leading to only the guilt of accused, not established. (Para 9) Ravishankar Tandon v. State of Chhattisgarh, 2024 LiveLaw (SC) 296

Documentary evidence – The photocopy of a document is inadmissible in evidence. (Para 36) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Section 6 – Res gestae – Relevancy of facts forming part of same transaction – It is based on spontaneity and immediacy of such statement or fact in relation to the fact in issue. Provided that if there was an interval which ought to have been sufficient for purpose of fabrication then the statement recorded, even with slight delay may not be part of res gestae. Held, idea of search of the house of Accused No. 4, is an afterthought with an admitted time gap of 40­45 minutes. The search conducted at the residence of the Accused No. 04 is not a continuance of action based on the secret information received. (Para 27 & 28) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Section 25 – Confession before a police officer – The bar under Section 25 of the IEA 1872 is not applicable against the admissibility of confessional statement made to the officers empowered under Section 41 and 42 of the NDPS Act 1985. (Para 50) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Section 27 – Discovery – It is only so much of the information as relates distinctly to the fact thereby discovered would be admissible. It will be necessary for the prosecution to establish that, the information given by the accused while in police custody had led to the discovery of the fact, which was distinctly within the knowledge of the maker of the statement. Held, the prosecution will have to establish that, before the information given by the accused persons on the basis of which the dead body was recovered, nobody had the knowledge about the existence of the dead body at the place from where it was recovered. A perusal of the evidence reveals that the police as well as these witnesses knew about the death and the dead body being found prior to the statements of the accused persons being recorded under Section 27. Hence, the prosecution has failed to prove that the discovery of the dead body was only on the basis of the disclosure statement made by the accused persons under Section 27 and that nobody knew about the same before that. (Para 13, 14, 21 & 22) Ravishankar Tandon v. State of Chhattisgarh, 2024 LiveLaw (SC) 296

Section 27 – Discovery – Rationale behind the provision – If a fact is actually discovered in consequence of the information supplied, it affords some guarantee that the information is true and it can therefore be safely allowed to be admitted in evidence as an incriminating factor against the accused. (Para 13) Ravishankar Tandon v. State of Chhattisgarh, 2024 LiveLaw (SC) 296

General Clauses Act, 1897

Section 3(22) – Good faith – Is an act done honestly, whether it is done negligently or not. (Para 8) State of Gujarat v. Paresh Nathalal Chauhan, 2024 LiveLaw (SC) 295

Hindu Widow's Remarriage Act, 1856

Section 2 – Right of widow in deceased husband's property to cease on marriage – Hence she could not convey any property over which she did not have any right or title. Held, the plaintiff who is the son of the widow and her second husband cannot claim share in suit property through the widow as the widow had lost her right over the subject property on her contracting second marriage. (Para 17 & 19) Kizhakke Vattakandiyil Madhavan v. Thiyyurkunnath Meethal Janaki, 2024 LiveLaw (SC) 293

Section 2 – Validity of lease deed – The validity of lease deed executed by the widow and her two sons is accepted to the extent it was made by the sons (sons of widow and deceased). Held, even if subsistence of a deed is proved in evidence, the title of the executing person does not automatically stand confirmed. If a document seeking to convey immovable property ex-facie reveals that the conveyer does not have the title over the same, specific declaration that the document is invalid would not be necessary. (Para 18) Kizhakke Vattakandiyil Madhavan v. Thiyyurkunnath Meethal Janaki, 2024 LiveLaw (SC) 293

Insurance Law

Insurer's burden to prove insured suppressed material facts. Mahakali Sujatha v. Future Generali India Life Insurance Company Ltd., 2024 LiveLaw (SC) 300

Judgment

Releasing a case after it has been heard over a substantial period and judgment has been reserved compounds not merely the delay, but expense for parties, as well. In such a situation, parties would be required to engage counsel and incur legal fees all over again for a fresh round of hearings. (Para 4) Manbhupinder Singh Atwal v. Neeraj Kumarpal Shah, 2024 LiveLaw (SC) 307

Narcotics Drugs and Psychotropic Substances Act, 1985

Can accused get default bail if FSL report isn't submitted with chargesheet within prescribed time? The Supreme Court refers to the Larger Bench. Hanif Ansari v. State (Govt of NCT of Delhi), 2024 LiveLaw (SC) 302

Sections 41 & 42 – Mandatory compliance of procedure before search – Power of Magistrate and an Officer of Gazetted rank to issue warrant – Empowers a Magistrate to issue search warrant for the arrest of any person or for search, whom he has reason to believe to have committed any offence under the provisions of the NDPS Act 1985. As per Section 41(2), such reason to believe must arise from either personal knowledge or information given by any person to him and is required to be reduced into writing. The search conducted at the house of Accused No. 01 and Accused No. 04 was not based on the personal knowledge, rather it was an action bereft of mandatory statutory compliance of Section 41(2). The raid at the house of the Accused No. 01 and Accused No. 04 is in violation of the statutory mandate of Section 41(2) of the NDPS Act 1985. (Para 32, 42, 46 & 47) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Section 42(1) – Power of entry, search, seizure and arrest without warrant or authorisation – The provision obligates an officer empowered by virtue of Section 41(2) to record the information received from any person regarding an alleged offence under Chapter IV of the NDPS Act 1985 or record the grounds of his belief as per the Proviso to Section 42(1), in case an empowered officer proceeds on his personal knowledge. The grounds of belief is to be conveyed to the immediate official superior, prior to the search and in case of any inability to do so, the Section 42(2) provides that a copy of the same shall be sent to the concerned immediate official superior along with grounds of his belief as per the proviso. Absolute non­compliance of the statutory requirements under the Section 42(1) and (2) of the NDPS Act 1985 is verboten. However, any delay in the said compliance may be allowed considering the same is supported by well-reasoned explanations for such delay. (Para 31) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Section 67 – Evidentiary value of confessional statements recorded under Section 67 – Information received under section 67 is not in the nature of a confessional statement. Such statements cannot be used against the accused. (Para 51 & 53) Najmunisha v. State of Gujarat, 2024 LiveLaw (SC) 298

Negotiable Instrument Act, 1881

Section 138 – Dishonouring of cheque – Held, existence of any “enforceable debt or other liability” not found. Petitioner's case not made out. (Para 11) Rajco Steel Enterprises v. Kavita Saraff, 2024 LiveLaw (SC) 306

Penal Code, 1860

Section 120B and Prevention of Money-Laundering Act, 2002; Section 2(1) (y) – Schedule offence – Offence punishable under Section 120B of the IPC could become a scheduled offence only if the conspiracy alleged is of committing an offence which is included in the Schedule to the PMLA. Held, the offences alleged in the complaint except Section 120-B of IPC are not scheduled offences within the meaning of Section 2(1) (y) of the PMLA. (Para 2, 3) Yash Tuteja v. Union of India, 2024 LiveLaw (SC) 310

Power of Attorney Holder

Attorney holder can maintain a plaint on behalf of the person he represents provided he has personal knowledge of the transaction in question. Attorney holder can depose and verify on oath before the court but he must have witnessed the transaction as an agent and must have due knowledge about it. The Power of Attorney holder who has no knowledge regarding the transaction cannot be examined as a witness. Evidence given by person who has no authority to act as power of authority, is meaningless to establish. (Para 28 & 29) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Prevention of Money-Laundering Act, 2002

Section 2(1) (y), 2(1) (u) & 3 and Criminal Procedure Code, 1973; Section 203 & 204 – Schedule offence – In absence of scheduled offence, there cannot be any proceeds of crime within the meaning Section 2(1) (u) of the PMLA. Proceeds of crime means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property. Existence of the proceeds of crime is a condition precedent for the applicability of Section 3 of the PMLA. If there are no proceeds of crime, the offence under Section 3 of the PMLA is not made out. Hence, there is no need of the Special Court to apply its mind in accordance with Section 203 r.w 204 of the Cr.PC to find out whether a prima facie case is made out or not. (Para 4, 6 & 7) Yash Tuteja v. Union of India, 2024 LiveLaw (SC) 310

Service Law

Prospective Application of Judgment - B.Ed. Qualification for Primary School Teachers - Review Petition - Equitable Retention of Employment - Bridge Course Requirement - The Judgment delivered on 11th August, 2023, concerning the eligibility criteria for B.Ed. candidates to be appointed as primary school teachers, shall have prospective operation. Candidates appointed prior to this date, based on B.Ed. qualification without any disqualification imposed by a court of law or without a stipulation that their appointment was subject to the final outcome of a case, shall retain their employment. However, such candidates must undergo a bridge course within a year from the date of the judgment to validate their appointments. The National Council for Teacher Education, under the supervision of the Ministry of Education, is directed to devise this course, applicable nationwide. Failure to complete the course within the specified timeframe will invalidate the appointment. The court further extends these directions to cover all similar cases pending in different judicial fora across states and union territories. Devesh Sharma v. Union of India, 2024 LiveLaw (SC) 297

Regularization of service – UGC directions must be followed by universities – UGC's letter to University directing regularization of the teachers who were selected through a regular selection process and possessed required qualifications was not followed by university. Appellants' appointments were made according to a regular selection process. Held, considering the statutory position of UGC, there was no reason for the University not to follow directions of UGC. The University's action of not continuing them and starting a fresh selection process is unjust, arbitrary and violative of Article 14 of the Constitution of India. Therefore, the employment of the appellants will have to be continued after merger with the regular establishment of the University. Respondents directed to reinstate the appellants. (Para 20, 23 & 28) Meher Fatima Hussain v. Jamia Milia Islamia, 2024 LiveLaw (SC) 303

Termination from service – Violation of principles of natural justice – Termination of the services of the appellant without holding disciplinary enquiry was unjustified and dehors the requirements of law and in gross violation of principles of natural justice. Termination order declared illegal and appellant reinstated in service. (Para 19 & 20) Sandeep Kumar v. GB Pant Institute of Engineering and Technology, 2024 LiveLaw (SC) 308

Sub-delegation of Powers

The functions of the General Power of Attorney holder cannot be delegated to any other person without there being a specific clause permitting such delegation in the Power of Attorney. Hence, ordinarily there cannot be any sub-delegation. (Para 28) Manisha Mahendra Gala v. Shalini Bhagwan Avatramani, 2024 LiveLaw (SC) 301

Waqf Act, 1995

The original jurisdiction to decide the issue pertaining to Mutawalliship vests with the Waqf board and not the Waqf Tribunal. S V Cheriyakoya Thangal v. S.V P Pookoya, 2024 LiveLaw (SC) 309