Supreme Court October 2022| Justice Dr DY Chandrachud’s confirmation as next CJI; Hijab Ban; Two-finger-test; clarification on some IBC provisions; and more

This roundup revisits the analyses of Supreme Court’s judgments/orders on Hijab Ban Controversy, Punishment for Two-Finger test on sexual assault survivors, Dishonour of Cheques; Insolvency and Bankruptcy Code and more. It also covers reports on confirmation of Justice Dr DY Chandrachud as the next CJI; Justice Hemant Gupta’s retirement; explainers on important law points; career trajectory and important decision of Justice S. Ravindra Bhat and Justice BV Nagarathna.

Supreme Court

Unmissable Stories

President appoints Justice Dr. DY Chandrachud as the 50th Chief Justice of India w.e.f Nov 9, 2022

♦Did you know? Justice Dr. DY Chandrachud has authored almost 500 Supreme Court judgments so far!

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Justice Hemant Gupta Retires: A Look at His Trajectory, Tenure and Decisions

In October 2022, Justice Hemant Gupta retired after a comprehensive term of 4 years as a Supreme Court judge. In his farewell speech, he stated,

A judge cannot make people happy, that’s not the role assigned to him. That role is assigned to other people in public life. One cannot discharge this role with intention of pleasing people

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Hijab Ban Split Verdict: Justice Gupta says no right to wear Hijab to a secular school; Justice Dhulia bats for right to education of Hijab wearing girls

The case revolves around a Government Order dated 5.2.2022, that imposed dress code for students of all schools and colleges of Karnataka “in the interests of unity, equality and public order”. The order was passed after it was brought to the education department’s notice that students in a few institutions have been carrying out their religious observances, which has become an obstacle to unity and uniformity in the schools and colleges.

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Patriarchal & sexist to assume that a sexually active woman cannot be raped; Anyone conducting ‘two-finger’ test will be guilty of misconduct

The “two-finger test” or pre vaginum test has no scientific basis and neither proves nor disproves allegations of rape. It instead re-victimizes and re-traumatizes women who may have been sexually assaulted, and is an affront to their dignity.

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Unhappy with two Ministries taking contradictory stands before it, Supreme Court asks Centre to evolve mechanism to resolve differences at Governmental Level itself

Concerned with the diagonally opposite stands taken by two ministries of the Union of India, the Court observed that it does not augur well for the Union of India to speak in two contradictory voices. The two departments of the Union of India cannot be permitted to take stands which are diagonally opposite.

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Commercial Court’s power while dealing with an application under Section 9 of the Arbitration and Conciliation Act, 1996

Difference between Contract of Indemnity and Contract of Guarantee

Land Acquisition Act, 1894: Will Section 11A apply if, under Section 17(3A), 80% of estimated compensation is tendered and paid?

Vicarious liability under Section 149 IPC: Impact of reduction in number of convicts below five on account of death of co-accused

Why BJP MLA Vijender Gupta’s tweet questioning Delhi’s Dy CM Manish Sisodia about his “scam” is not defamation?

Crimes and Criminals

Militant’s encounter matter of National Security; Exhumation cannot be claimed as a matter of right

The Court has asked the Union of India to consider enacting an appropriate legislation on exhumation so as to tackle the situations like the one on hand.

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Mining Tycoon G. Janardhan Reddy to remain out of Karnataka’s Bellary, 2 AP Districts after Nov 7 till conclusion of trial; Trial to be concluded within 6 months ‘without fail’

Reddy, who is a mining tycoon and also a former Karnataka MLA, has been facing trial for serious offences relating to illegal mining. He has been charged under under Sections 120(B), 420, 379, 409, 468, 411, 427 and 447 of the Penal Code, 1860; Section 2 of the Forest Act, 1927, Rule 21 read with Rules 4(1), 4(1)(A) and 23 of the Mines and Minerals (Development and Regulation) Act, 1957.

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Supreme Court issues notice in petition seeking transfer of Anant Karmuse assault case involving NCP Leader Jitendra Awhad to CBI

It has been alleged that on April 5, 2020, Karmuse was taken to the then Cabinet Minister, Jitender Awhad’s bungalow on his instructions, where he was beaten with bamboos, fibre sticks, belts and iron rods by NCP workers in the presence of two police constables and Awhad, for uploading a viral picture of Awhad, criticizing his act of ridiculing the Prime Minister on his Facebook account.

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Supreme Court suspends Bombay High Court’s order discharging UAPA accused Prof GN Saibaba & others

The accused was discharged by the High Court on the ground that, at the time of taking cognizance and/or framing the charge, there was no sanction to prosecute him at all.

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Dishonour of Cheques

Section 138 NI Act would not attract if cheque does not represent a legally enforceable debt at the time of encashment

The Court was deciding the case where the respondent had made part-payments after the debt was incurred and before the cheque was encashed upon maturity. The sum of rupees twenty lakhs represented on the cheque was not the ‘legally enforceable debt’ on the date of maturity. Thus, it was held that the respondent cannot be deemed to have committed an offence under Section 138 of the Act when the cheque was dishonoured for insufficient funds.

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Education Law

“Meritorious students don’t need backdoor entry”; Supreme Court quashes illegal admissions to Chhattisgarh PG Dental Colleges

In the mop up round of counselling, the respondents did participate, but could not secure admission on merits in the colleges in which subsequently they got admissions through backdoor and, if the respondents were so meritorious, they would have got admissions on merits through mop up round conducted by the Directorate. Thus, this itself suggests that they were not having merit to get admissions in the institutions in which subsequently got admissions.

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Insolvency and Bankruptcy Law

CIRP proceedings can be initiated against two Corporate Debtors but same amount cannot be realised from both

“If the dues are realised in part from one Corporate Debtor, the balance may be realised from the other Corporate Debtor being the co-borrower. However, once the claim of the Financial Creditor is discharged, there can be no question of recovery of the claim twice over.”

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Supreme Court reaffirms that NCLT under S. 7(5) of Insolvency and Bankruptcy Code has discretionary power to admit or reject an application

In a review petition filed by Axis Bank against Supreme Court’s judgment in Vidarbha Industries Power Ltd. v. Axis Bank Ltd., (2022) 8 SCC 352, the division bench of Indira Banerjee and J.K. Maheshwari, JJ. has dismissed the review petition and reaffirms that the National Company Law Tribunal (‘NCLT’) under section 7(5) of the Insolvency and Bankruptcy Code, 2016 (‘the Code’) has discretionary power to admit/reject an application.

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Maintenance Law

‘Able-bodied man obliged to earn by legitimate means and maintain wife, children’: Supreme Court, unhappy with Family Court’s verdict, directs husband to pay maintenance to his wife

The division bench of Bela M. Trivedi*. and Dinesh Maheshwari, JJ has held that it is unfortunate that such an erroneous and perverse order of Family Court, was confirmed by the High Court in a very perfunctory impugned order, without assigning any reasons.

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Procedural Law

‘Appoint experienced advocates as legal aid counsels’: SC acquits death row convict for want of evidence, finds defence ‘below-average’

The Supreme Court was disappointed with the standard of investigation and the defence put up in a gruesome case relating to murder of wife and 4 children by the accused. The Court observed that while the accused was provided with a legal aid, the cross-examination of each and every witness was below average.

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Court’s power under Section 9 A&C Act, 1996 wider than CPC; Technicalities of CPC cannot prevent it from securing the ends of justice

he Supreme Court dismissed appeals against the order of Bombay High Court (Division Bench), dismissing the Commercial Arbitration Appeal filed by Essar House Private Limited (hereinafter referred to as Essar House) under Section 37 of Arbitration and Conciliation Act, 1996 (hereinafter referred to as Act), subsequently confirming the order of Single Judge, allowing an application filed by Arcellor Mittal Nippon Steel India Limited (hereinafter referred to as Arcellor), under Section 9 of the Act, wherein the Judge directed Essar House Private and Essar Service to deposit an amount with High Court or, in alternative furnish bank guarantee.

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‘Delays in prosecuting the corrupt breeds a culture of impunity’; Sanction requests under PC Act must be decided within 4 months but proceedings cannot be quashed for delay

The consistent effort made by all branches of the State, the Judiciary, the Legislative, and the Executive, to ensure early decision-making by the competent authority cannot be watered down by lexical interpretation of the expression endeavour in the proviso.

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Failure to produce accused before Special Court while considering extension application under Section 167 CrPC a gross illegality

“The accused may not be entitled to know the contents of the report but he is entitled to oppose the grant of extension of time on the grounds available to him in law.”

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Limitation can be a preliminary issue under Or. 14, R. 2(2)(b) CPC if the question can be decided on admitted facts

Principal question before the Division Bench of Ajay Rastogi and C.T. Ravikumar*, JJ., for contemplation was whether the issue of limitation can be determined as a preliminary issue under Order 14, Rule 2(2) of the Civil Procedure Code, 1908 (for short ‘CPC’). The Supreme Court while addressing the series of judgments in the instant case dismissed the appeal filed against the judgment of High Court of Delhi.

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Triple method of plea bargaining, compounding of offences and the Probation of Offenders Act, 1958: Supreme Court’s suggestions on disposal of criminal cases

In a suo motu writ petition, the division bench of Sanjay Kishan Kaul and Abhay S. Oka, JJ has provided suggestions for effectuating the provisions relating to plea bargaining/ compounding/probation of offenders act; regarding the convicts who are undergoing fixed terms sentences and are in jail, and for the remission of sentence for such convicts.

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“To be ‘substantial’, a question of law must be…”. Supreme Court summarises principles relating to Section 100 CPC

The bench of Indira Banerjee* and JK Maheshwari, JJ has explained that to be ‘substantial’, a question of law must be debatable, not previously settled by law of the land or a binding precedent, and must have a material bearing on the decision of the case, if answered either way, insofar as the rights of the parties before it are concerned.

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Providing illegible copies attacks detenu’s fundamental right to make representation; renders detention order illegal

In the case at hand, the Manipur High Court had set aside the order of detention passed under the Prevention of Illicit Traffic in Narcotic Drugs and Psychotropic Substances Act, 1988 on the premise that the detaining authority failed to supply the legible copies of documents which were relied upon by it while passing the order of detention.

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Imposing penalty before initiating disciplinary action wrong; Can’t put a cart before the horse

The Court observed that in the absence of a disciplinary action for imposing minor/major penalties as contemplated under Rule 10 or Rule 8 of the Rules 1969 either initiated or pending, there could not be any occasion of proposing the penalty to be inflicted upon the delinquent officer and that doing so would be nothing but putting a cart before the horse.

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Right to Information versus Right to Privacy

Supreme Court invokes doctrine of ex debito justitiae to hear HDFC’s plea challenging RBI directions mandating disclosure of confidential & sensitive information

“To err is human, and the Courts including the Apex Court are no exception.”

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Service Law

In the guise of removing difficulties, State cannot change scheme & essential provisions of the Calcutta University Act, 1979; Power to reappoint VC vested in Chancellor

The question for contemplation before the Division Bench of Dr Dhananjaya Y Chandrachud* and Hima Kholi, JJ., was whether the State has authority to appoint or reappoint Vice Chancellor of Calcutta University under Section 8 of the Calcutta University Act, 1979 (hereinafter Act) or by taking recourse to the residuary provisions of Section 60 of the Act.

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Married daughter cannot claim compassionate appointment as a right; certainly not years after employee’s death

In a case where a married daughter of the deceased was claiming compassionate appointment, the bench of MR Shah* and Krishna Murari, JJ has held that neither the the daughter was dependent on her mother nor was she entitled to appointment on compassionate ground after a number of years from the death of the deceased employee.

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WB Teachers’ Recruitment Scam| Can’t remove a person from a public post without giving him an opportunity to defend; Board President’s removal stayed but investigation to continue

The Court was deciding the special leave petition arising out of a judgment of the division bench of the Calcutta High Court sustaining the orders passed by a single judge, directing investigation by the Central Bureau of Investigation (‘CBI’) into the allegations of irregularities in the recruitment process of assistant primary teachers, and cancellation of appointment of 269 candidates.

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Taxation Law

Profit-oriented Educational Institutions not entitled to tax emption under Section 10(23C) of the Income Tax Act, 1961

“In a knowledge based, information driven society, true wealth is education – and access to it. Every social order accommodates, and even cherishes, charitable endeavour, since it is impelled by the desire to give back, what one has taken or benefitted from society. Our Constitution reflects a value which equates education with charity. It is not to be treated as business, trade, nor commerce.”

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Gift Tax: Equity shares under lock-in period remain unquoted; Cannot be valued by ignoring restrictive conditions on transferability

The Court observed that in terms of the Rules, a hybrid method of valuation cannot be applied, while applying Rule 9 of Part C of Schedule III of the W.T. Act, which prescribes the method of valuation for quoted shares.

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Know Thy Judges

Justice S. Ravindra Bhat

Justice BV Nagarathna

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