'This Court Won't Shy Away From Acknowledging Its Mistakes' : Supreme Court Allows ED's Application To Recall Order

The Supreme Court recently allowed an application filed by the Directorate of Enforcement(ED) to recall an earlier order which granted protection from coercive action to certain accused in a money laundering case till their petitions challenging the proceedings were finally disposed of by the High Court.

The ED sought the recall of the order, which was passed on July 4, 2023, on the ground that it was not heard before the same was passed. The bench comprising Justices Sanjay Kumar and Aravind Kumar noted that the ED was not actually heard when the order was passed as the application to implead the ED was allowed only on that day. As per the order passed on July 4, 2023, while disposing of the writ petitions asking the petitioners to approach the respective High Courts for relief, the Court also granted them protection from coercive action till the matter was finally disposed of by the High Court.

Though ordinarily Miscellaneous Applications seeking modifications can't be entertained after the matter has been disposed of, the bench said that the inherent powers of the Court to prevent miscarriage of justice can be invoked in appropriate cases. The bench also underlined the importance of correcting the mistakes which may have occurred on the part of the Court.

"...when the individual facts of a particular case so warrant, there can be no bar to entertaining a clarification/modification petition in a disposed of case. This would necessarily depend on the facts and circumstances of that individual case. Notably, Rule 6 of Order LV of the Supreme Court Rules, 2013, states that nothing in the said Rules shall be deemed to limit or otherwise affect the inherent powers of the Court to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of the Court. Therefore, if any such abuse of process is noticed after the disposal of the case or if a modification is found essential to meet the ends of justice, this Court would be justified in entertaining an application in a disposed of case and exercising such power."

Our legal system acknowledged the fallibility of judges, the bench observed referring to V.K. Jain v. High Court of Delhi through Registrar General and others (2008) 17 SCC 538.

"As Courts of record, it is necessary that Constitutional Courts recognize errors that may have crept into their judicial orders and rectify the same when called upon to do so.... Being the Court of the last resort, this Court would not shy away from acknowledging any mistakes in its orders and would be ready to set right such wrongs."

The bench also invoked the well-settled principle that no adverse order should be passed against a party without hearing it. Referring to State of Punjab v. Davinder Pal Singh Bhullar and others (2011) 14 SCC 770, the Court noted that if an order is pronounced without giving an opportunity of hearing to a party affected by it, inherent powers of the Court can be exercised to recall such an order.

"In the case on hand, the Enforcement Directorate, New Delhi, was impleaded as a party respondent in the writ petition on 04.07.2023, by way of the final order disposing of the case. The final order was passed without putting it on notice and affording it an opportunity of hearing. Therefore, the directions of this Court in the said order in relation to ECIR No. ECIR/HIU-1/06/2023 cannot be sustained,"

The Court also noted that certain errors had also crept in the order due to oversight. Though the petitioners were given interim protection from coercive action, the order also said that the petitioners will be at liberty to seek interim protection from the High Court.

Improper to bind High Courts with SC orders when petitioners are relegated to HC

"When a party is relegated to the High Court to pursue its remedies, it would not be proper, in the normal course, to bind the said High Court with directions in relation to the proceedings to be impugned before such Court. Ordinarily, this Court would leave all issues open for the party so relegated to raise and pursue before the High Court," the Court further observed. Reference was made to Neeharika Infrastructure (P) Ltd. vs. State of Maharashtra.

The Court also noted that such directions can be misconstrued by the High Courts to be observations by this Court on the merits of the matter, thereby influencing the adjudication of the case.

For the above reasons, the Court recalled the order passed on July 4, 2023.

Case Details : Gagan Banga and another v. The State of West Bengal

Citation : 2024 LiveLaw (SC) 736

Click here to read the judgment