1 |
28-03-2025 |
IMRAN PRATAPGADHI vs STATE OF GUJARAT
Crl.A. No. 1545/2025 |
Posting a poem promoting sacrifice and non-violence does not attract offences under Sections 196, 197, 299, 302, or 57 BNS; FIR registration in such cases is abuse of law. |
IMRAN PRATAPGADHI V. STATE OF GUJARAT 2025 INSC 410 (Invalid Date) Justices: Justice Abhay S. Oka, Justice Ujjal Bhuyan Question(s): Whether the recitation and posting of a poem by the appellant constituted offences punishable under Sections 196, 197, 299, 302, and 57 of the Bharatiya Nyaya Sanhita, 2023 (BNS), and whether registration of the FIR violated the appellant’s fundamental rights under Article 19(1)(a) of the Constitution. Factual Background: The appellant, a Member of the Rajya Sabha, had posted on his verified ‘X’ (formerly Twitter) account a video clip from a mass marriage ceremony at which a poem was recited. The poem, in Urdu, metaphorically spoke of facing injustice with love and sacrificing personal losses for truth. A complaint alleged that the poem incited enmity between communities, promoted hatred, and harmed national unity. FIR was registered under Sections 196, 197(1), 302, 299, 57, and 3(5) of the BNS. The High Court dismissed the appellant’s petition seeking quashing of the FIR. The appellant approached the Supreme Court Decision of the Supreme Court: The Supreme Court allowed the appeal, quashed the FIR, and held that registration of the FIR in respect of the posted poem was a mechanical exercise without application of mind, amounted to a clear abuse of process of law, and violated the fundamental right of the appellant under Article 19(1)(a) of the Constitution. Reasons for the Decision: Meaning of the Poem and Lack of Offence The Court, after carefully analysing the Urdu text and its English translation (¶9), concluded that the poem “has nothing to do with any religion, community, region or race” (¶10(a)). It neither affects national integration nor jeopardizes sovereignty, unity, or integrity of India (¶10(b), (c)). The Court emphasized that the poem “preaches non-violence” and encourages meeting injustice with love and sacrifice, not by resorting to violence (¶10(f), ¶10(h)). It noted that the reference to the "throne" was symbolic and denoted resistance against injustice rather than incitement against any community (¶10(g)). No Ingredients of Offences Made Out The Court exhaustively examined the ingredients of Section 196 of the BNS (¶13-14) and observed that the poem did not promote disharmony, hatred, or ill-will between religious, racial, linguistic or regional groups. The poem neither disturbed public tranquility nor sought to create disharmony (¶14). The offence under Section 197 was also ruled out as there was no assertion or imputation against any religious, racial, language, regional group, caste, or community (¶16). The Court found the invocation of Section 299 “ridiculous” (¶17), as the poem did not outrage religious feelings or insult religious beliefs. Similarly, the allegation under Section 302, requiring deliberate intention to wound religious feelings, was found wholly baseless (¶18). Section 57 concerning abetment by the public was found to have no nexus, as there was no act of abetment proved or alleged (¶19).
Duty to Respect Freedom of Speech and Role of Preliminary Inquiry under BNSS The Court emphasized the mandatory requirement of registration of FIR under Section 173(1) of BNSS only if a cognizable offence is disclosed (¶20-22). However, the Court clarified that sub-section (3) of Section 173 allows a preliminary inquiry even where the offence is cognizable if the offence is punishable for three years or more but less than seven years (¶23-24). In the present case, since the offences alleged fell within that range (except Section 57), the police ought to have conducted a preliminary inquiry (¶28-29).
The Court stressed that where allegations concern spoken or written words potentially attracting the exception under Article 19(2) of the Constitution, the police must exercise particular care and undertake preliminary inquiry (¶30). The obligation of the police to respect constitutional ideals under Article 51-A(a) was highlighted (¶29). Standard to Judge Alleged Offensive Speech Quoting the paragraph 67 of the judgment authored by Bose and Puranik, JJ in Bhagwati Charan Shukla v. Provincial Government, C.P. & Berar (1946 SCC OnLine MP 5), the Court held that the effect of words must be judged “using the standards of reasonable, strong-minded, firm and courageous men, and not those of weak and vacillating minds” (¶32-33). The Court reaffirmed that the poem, viewed from this standard, did not incite hatred or enmity and in fact promoted resilience against injustice through peaceful means.
Requirement of Mens Rea The Court reiterated that mens rea is an essential ingredient for offences under Section 196, following its earlier decisions in Manzar Sayeed Khan v. State of Maharashtra (2007) 5 SCC 1 and Patricia Mukhim v. State of Meghalaya (2021) 15 SCC 35 (¶34). It held that there was no deliberate intention on part of the appellant to promote enmity or ill-will, and thus, even on prima facie basis, the necessary mens rea was absent. The Court severely criticized the High Court for failing to appreciate the fundamental constitutional protection of freedom of speech (¶35-37). It noted that the High Court wrongly relied on the "nascent stage of investigation" to refuse quashing the FIR despite no prima facie case being made out. It reaffirmed that Courts can and must quash proceedings at the initial stage itself to prevent abuse of process (¶37).
Importance of Protecting Freedom of Expression The Court eloquently reaffirmed that free expression is "an integral part of a healthy, civilised society" and is indispensable to a dignified life under Article 21 (¶38). Courts must be vigilant to protect constitutional rights even if the content of speech is unpopular or uncomfortable to some (¶39-40). Reliance was placed on Anand Chintamani Dighe v. State of Maharashtra (2001 SCC OnLine Bom 891) and Shreya Singhal v. Union of India (2015) 5 SCC 1 to reiterate that tolerance for dissent and non-mainstream views is a cardinal constitutional value (¶40-41). The Court summarized in ¶42-44 that Section 173(3) of BNSS permits preliminary inquiry even where a cognizable offence is disclosed if the punishment is between three to seven years. The police must act sensitively in such matters, particularly where free speech under Article 19(1)(a) is concerned. The Court emphasized that registration of FIRs based on speech must not stifle fundamental freedoms unless reasonable restrictions under Article 19(2) are genuinely attracted.
Prepared by Iram Jan Communications Division| Supreme Court of India © Supreme Court of India
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2 |
25-02-2025 |
SUNIL KUMAR SINGH vs BIHAR LEGISLATIVE COUNCIL
W.P.(C) No. 530/2024 |
Challenge to the expulsion of a member of the legislature |
SUNIL KUMAR SINGH V. BIHAR LEGISLATIVE COUNCIL 2025 INSC 264 (25 February 2025) Justices: Justice Surya Kant, Justice Nongmeukapam K. Singh Question(s): (i) Whether the Writ Petition filed by Mr. Sunil Kumar (“Petitioner”) challenging his expulsion from the Bihar Legislative Council (“BLC”) is maintainable in view of Article 212 (1) of the Constitution of India and whether the proceedings of the Ethics Committee are amenable to judicial review. (ii) Can the Supreme Court in exercise of its writ jurisdiction review the proportionality of the punishment imposed by the House? (iii) If so, whether the Petitioner’s expulsion is disproportionate to the misconduct attributed to him and whether it merits any interference? (iv) Whether the Supreme Court is empowered to determine the quantum of punishment that may be imposed on the Petitioner? Factual Background: The Petitioner, a member of the Rashtriya Janata Dal (“RJD”), filed a Writ Petition under Article 32 of the Constitution of India to challenge his expulsion from the Bihar Legislative Council (“BLC”). The Petitioner was alleged of unparliamentary conduct during the Governor’s address on 13 February 2024. Specifically, he and another Member of the Legislative Council (“MLC”), Md. Sohaib, disrupted the proceedings by using derogatory slogans and mimicking the Chief Minister. A formal complaint was lodged against them on 19 February 2024, leading the BLC Chairman to refer the matter to the Ethics Committee for inquiry. The Ethics Committee scheduled an inquiry for 3 May 2024, which Md. Sohaib attended, expressing regret. However, the Petitioner repeatedly sought exemptions, claiming engagements related to the Lok Sabha elections and other commitments. He finally appeared before the Ethics Committee on 12 June 2024, but challenged the committee's authority rather than addressing the charges. The Ethics Committee then pre-poned their meeting from 19 June 2024 to 14 June 2024, without notifying the Petitioner, and concluded the proceedings. The Ethics Committee submitted its report on 14 June 2024, recommending the Petitioner's expulsion and Md. Sohaib's suspension for the first two days of the 208th Session of the House. On 26 July 2024, the BLC adopted the report, leading to the Petitioner’s expulsion and Md. Sohaib’s suspension. Subsequently, on 26 July 2024, the BLC Secretariat issued a notification formally relieving the Petitioner of his membership. During the petition's pendency, the Election Commission of India declared a bye-election for the vacant seat on 30 December 2024, with the process to conclude by 25 January 2025. The Supreme Court then stayed the declaration of the bye-election result on 15 January 2025.
Decision of the Supreme Court: The Division Bench (two judges) of the Supreme Court quashed the punishment of expulsion of the Petitioner from the BLC for being disproportionate and excessive.The Court held that the prohibition under Article 212(1) only bars Constitutional Courts from reviewing the legislative proceedings for procedural irregularity. However, it does not prevent the judicial review of the legality or constitutionality of the legislature's actions (both lawmaking and administrative decisions). The judgement of the Court was authored by Justice Kant. Reasons for the Decision: The Division Bench (two judges) of the Supreme Court quashed the punishment of expulsion of the Petitioner from the BLC for being disproportionate and excessive.The Court held that the prohibition under Article 212(1) only bars Constitutional Courts from reviewing the legislative proceedings for procedural irregularity. However, it does not prevent the judicial review of the legality or constitutionality of the legislature's actions (both lawmaking and administrative decisions). The judgement of the Court was authored by Justice Kant. Reasons for the Decision: Maintainability of Writ Petition under Article 212(1) and Judicial Review of Ethics Committee Proceedings The Supreme Court rejected the objection to the maintainability of the writ petition under Article 212(1) of the Constitution, which bars judicial scrutiny of procedural irregularities in “Proceedings in the Legislature”. The Court reasoned that Article 212(1) protects only the formal steps and debates within the House (motions, deliberations etc.) from judicial inquiry but does not shield legislative decisions or administrative actions (¶¶10-14, ¶23). The Ethics Committee’s recommendation for the Petitioner’s expulsion was deemed an administrative function under Rules framed under Article 208, aimed at enforcing discipline, and not a “proceeding” or “legislative decision” (¶¶17-18). The Court held that such administrative actions, even by legislative bodies, are subject to judicial review if they infringe fundamental rights, lack constitutional authority, or are arbitrary (¶¶19-20). The Court ruled that expulsion impacted the fundamental rights of the petitioner and representative governance, necessitating judicial scrutiny of its legality and proportionality (¶¶21-22). Proportionality of Punishment Imposed by the House The Supreme Court held that Constitutional Courts can examine the proportionality of punishments imposed by legislative bodies. The doctrine of proportionality requires that punitive measures be necessary, balanced, and the least restrictive means to achieve disciplinary objectives (¶¶25-26, ¶62). The Court reasoned that expulsion, being a grave measure, must be reserved for exceptional cases and account for its impact on democratic representation (¶¶57-59). The Court outlined guiding factors for assessing proportionality, including: (i) the degree of obstruction caused by the member; (ii) whether the conduct harmed the House’s dignity; (iii) the member’s prior and subsequent conduct (remorse); (iv) availability of lesser penalties; and (v) balancing societal interests, such as the electorate’s right to representation (¶64). The Court held that while Constitutional Courts must defer to legislative autonomy, they must intervene if the punishment is manifestly disproportionate or shocks constitutional conscience (¶61). Power of the Supreme Court to Determine Quantum of Punishment under Article 142 The Supreme Court reasoned that while judicial restraint ordinarily requires courts to remit matters of punishment to disciplinary authorities, Article 142 empowers it to substitute the punishment in exceptional cases to ensure “complete justice” (¶¶79-81). The Court ruled that remanding the matter to the Ethics Committee for reconsideration would result in protracted proceedings, depriving the Petitioner of participation in legislative sessions and exacerbating the infringement of his fundamental rights under Article 14 (¶¶82-83). The Court found that the Petitioner had already undergone seven months of expulsion, with his term set to expire in 2026, leaving limited time for representation (¶82).The Supreme Court therefore modified the punishment by Invoking Article 142, deeming the period of expulsion already served as equivalent to suspension, which it held was proportionate to the misconduct (¶86). The Supreme Court reinstated the Petitioner as a member of the Bihar Legislative Council with immediate effect but barred him from claiming remuneration for the expulsion period. The Court clarified that this modification did not condone the Petitioner’s conduct and warned against future misconduct (¶¶86-87). As a result, the Press Note dated 30.12.2024 issued by Election Commission, declaring the bye-election for the seat earlier held by the Petitioner was quashed, and all actions following it were annulled. Prepared by Osama Noor and Raza Zaidi Centre for Research and Planning | Supreme Court of India © Supreme Court of India
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3 |
07-02-2025 |
VIHAAN KUMAR vs THE STATE OF HARYANA
Crl.A. No. 621/2025 |
Consequence of not informing grounds of arrest |
VIHAAN KUMAR V. THE STATE OF HARYANA 2025 INSC 162 (7 February 2025) Justices: Justice Abhay S. Oka, Justice Nongmeikapam Kotiswar Singh Question(s): (i) Whether the Appellant’s arrest was rendered illegal due to non-compliance with Article 22(1) of the Constitution (failure to communicate grounds of arrest). (ii) Whether the Appellant’s treatment (handcuffing and chaining to a hospital bed) violated his fundamental right to dignity under Article 21. (iii) Whether subsequent legal processes (remand, chargesheet) can validate an arrest vitiated by constitutional violations. Factual Background: Vihaan Kumar (“Appellant”), was arrested on 10 June 2024 for offences under Sections 409, 420, 467, 468, and 471 read with Section 120-B of the Indian Penal Code. The Appellant filed a writ petition under Article 226 of the Constitution before the Punjab and Haryana High Court challenging his arrest as illegal, which was dismissed on 30 August 2024. Consequently, he appealed before the Supreme Court. The Appellant claimed that he was arrested at 10:30 AM on 10 June 2024 and produced before a magistrate on 11 June 2024 at 3:30 PM, alleging a violation of Article 22(2) (failure to produce within 24 hours). He further contended that the grounds of arrest were not communicated to him, breaching Article 22(1). The State, however, asserted that the arrest occurred at 6:00 PM on 10 June 2024, complying with the 24-hour rule, and that the grounds were orally communicated. A critical additional grievance arose when the Appellant, after arrest, was hospitalized at PGIMS, Rohtak, where he was handcuffed and chained to a hospital bed. Photographic evidence corroborated this treatment, prompting the Supreme Court to issue notices to the hospital and police authorities. The State later suspended the involved officers and initiated a departmental inquiry.
Decision of the Supreme Court: The Supreme Court allowed the appeal, declaring the Appellant’s arrest illegal due to non-compliance with Article 22(1). The Court ordered the Appellant’s immediate release, quashed all subsequent remand orders, and directed the State of Haryana to issue guidelines prohibiting the handcuffing of accused persons in hospitals. The judgment of the Court was authored by Justice Oka. Justice Singh authored a concurring opinion.
Reasons for the Decision: Violation of Article 22(1): Failure to Communicate Grounds of Arrest The Supreme Court held that Article 22(1) mandates that an arrested person be informed of the grounds of arrest “as soon as may be,” ensuring the ability to challenge detention and seek legal remedies. The Court referred to Pankaj Bansal v. Union of India 2023 INSC 866 and Prabir Purkayastha v. State (NCT of Delhi) 2024 INSC 414 and held that communication of grounds must be meaningful and effective, preferably in writing, to avoid disputes. While Article 22(1) does not explicitly require written communication, the Court ruled that vague assertions or oral claims by police are insufficient (¶¶11-14). The Appellant’s petition specifically pleaded non-communication of grounds of arrest, which the State failed to counter in its affidavits. Instead, the State claimed the Appellant’s wife was informed, which the Supreme Court dismissed as irrelevant to constitutional compliance (¶¶22-24). The State’s reliance on a case diary entry (recording communication of grounds at 6:10 PM) was rejected by the Court as an “afterthought” due to the absence of contemporaneous documentation of the actual grounds (¶27). The Court reasoned that the burden to prove compliance lies on the State, and mere diary entries without detailing the grounds were deemed inadequate. The Court thus held that non-compliance with Article 22(1) vitiated the arrest, rendering all subsequent custody unlawful (¶22-28). Violation of Article 21: Handcuffing and Chaining to Hospital Bed The Supreme Court condemned the Appellant’s treatment as a gross violation of dignity under Article 21. The Court found the handcuffing and chaining to a hospital bed without justification shocking and unconstitutional. The Court directed the State to issue guidelines to prevent such practices, emphasizing that custodial treatment must respect human dignity (¶29). Effect of Subsequent Legal Processes The State argued that the filing of a chargesheet validated the Appellant’s custody. The Supreme Court rejected this and held that constitutional violations at the arrest stage cannot be cured by subsequent procedures. The Court reasoned that once an arrest is vitiated under Article 22(1), continued detention based on remand orders or trial proceedings remains unlawful (¶16). Justice Singh in his concurring opinion, reinforced Justice Oka’s conclusions while elaborating on the constitutional and statutory imperatives underpinning the communication of grounds of arrest. He reasoned that the mandate of Article 22(1) — requiring arrested persons to be informed of the grounds of arrest — is not merely procedural but a fundamental safeguard to protect liberty under Article 21. Justice Singh ruled that written communication of grounds is essential to ensure the arrestee can meaningfully challenge detention and seek legal remedies. Justice Singh further noted that statutory provisions such as Section 50 of the Code of Criminal Procedure, 1973 (“CrPC”) (Section 47 of the Bharatiya Nagarik Suraksha Sanhita, 2023) and Section 19 of the Prevention of Money Laundering Act, 2002 operationalize this constitutional right, making non-compliance a fatal illegality (J. Singh ¶2). Justice Singh expanded on the role of Section 50A of the CrPC, which obligates authorities to inform the arrestee’s relatives or nominated persons about the arrest and its grounds. He reasoned that this requirement was not a “mere formality” but a critical mechanism to enable the arrestee’s circle to act swiftly — such as arranging legal aid or bail — to actualize the right to liberty. By linking this statutory duty to Article 21, Justice Singh held that the failure to communicate grounds in writing to both the arrestee and their representatives undermines the very purpose of constitutional safeguards, rendering the arrest unlawful (J. Singh ¶3). Prepared by Osama Noor Centre for Research and Planning | Supreme Court of India © Supreme Court of India
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4 |
29-01-2025 |
INDEPENDENT SUGAR CORPORATION LIMITED vs GIRISH SRIRAM JUNEJA
C.A. No. 6071/2023 |
Prior approval of the Competition Commission of India (CCI) under Section 31(4) of the Insolvency and Bankruptcy Code (IBC) is mandatory before approval of a Resolution Plan by the Committee of Credit |
INDEPENDENT SUGAR CORPORATION LIMITED V. GIRISH SRIRAM JUNEJA 2025 INSC 124 (Invalid Date) Justices: Justice Hrishikesh Roy, Justice Sudhansu Dhulia, and Justice SVN Bhatti Question(s): (i)Whether the approval of the Competition Commission of India (CCI) for a proposed combination must mandatorily precede the approval of the Resolution Plan by the Committee of Creditors (CoC) under the proviso to Section 31(4) of the Insolvency and Bankruptcy Code, 2016 (IBC)? (ii) Whether the National Company Law Appellate Tribunal (NCLAT) erred in holding that prior CCI approval before CoC approval is only directory and not mandatory? (iii)Whether the Resolution Plan approved by CoC in favour of AGI Greenpac was legally valid despite the alleged lack of statutory approvals at the time of voting? Factual Background: Independent Sugar Corporation Ltd. (INSCO) challenged the approval of a Resolution Plan submitted by AGI Greenpac Ltd. for the acquisition of Hindustan National Glass and Industries Ltd. (HNGIL), a major player in the glass packaging industry. HNGIL, undergoing insolvency proceedings under the IBC, had invited resolution applicants, with both INSCO and AGI Greenpac submitting their respective plans. A key issue arose when AGI Greenpac's Resolution Plan was approved by the CoC on 28.10.2022 with 98% votes, despite lacking prior approval from the CCI. INSCO contended that such approval was mandatory under Section 31(4) of the IBC, especially in cases involving combinations under the Competition Act, 2002. NCLAT ruled that while CCI approval was mandatory, its timing—whether before or after CoC approval—was directory, thus upholding AGI Greenpac's approval. INSCO challenged this ruling before the Supreme Court.
Decision of the Supreme Court: A three Judge-Bench of the Supreme Court set aside the NCLAT judgment, holding that prior approval from the CCI before CoC approval is mandatory, not merely directory. The Court ruled that the statutory framework under the IBC and Competition Act requires compliance with the proviso to Section 31(4) IBC, which mandates obtaining CCI approval before a Resolution Plan involving a combination is put to vote. The order of the Court was rendered by a bench of Justice Hrishikesh Roy, Justice Sudhansu Dhulia, and Justice SVN Bhatti. Reasons for the Decision:
Plain Meaning of the Proviso to Section 31(4) IBC The Court applied the principle of plain meaning, holding that the statutory language clearly mandates that where a Resolution Plan contains a provision for a combination, CCI approval must be obtained prior to CoC approval (¶35). The legislative intent behind inserting the provision to Section 31(4) of the IBC suggests that prior approval of the CCI was specifically mandated and it should not be seen as a flexible provision to be ignored in certain exigencies. Interpreting it as merely a directory would go against the legislature’s intent. Such a view would weaken the provision and render it ineffective. (¶53). Legislative Intent and Reports Supporting Mandatory Compliance The CCI, under Section 31(3) of the Competition Act and Regulation 25(1)(A) of the Combination Regulations, must approve, reject, or modify a combination before the CoC considers it. This ensures that the CoC, while exercising its commercial wisdom, has complete regulatory information ((¶79-81). Therefore, the approval from CCI must be obtained before the same is approved by the CoC. Otherwise, an illogical situation may arise since any modifications so directed by the CCI, would be kept out of the scrutiny of the CoC and the CoC would be forced to exercise its commercial wisdom without complete information (¶80-81). The Court also examined that when a Resolution Plan containing a provision for a combination that leads to an Appreciable Adverse Effect on Competition (AAEC) is placed before the CoC for approval before securing prior approval from the CCI, the Plan is incapable of being enforced or implemented. Specific consequences in law are provided under the IBC and the Competition Act for the same. As is clear, such a major omission cannot be cured at a later stage. In the present case, the CCI-unapproved Resolution Plan does not pass muster. The same cannot be approved by this Court as it is in violation of Sections 30(2)(e), 30(3), 30(4), and 34(4)(a) of the IBC, thereby contravening provisions of the law for the time being in force (¶86). Harmony between Stipulated Timelines NCLAT held that the proviso to Section 31(4) of the IBC is directory, reasoning that mandatory prior approval from the CoC would disrupt CIRP timelines. The Supreme Court rejected this, emphasizing that statutory provisions take precedence over subordinate regulations and that the IBC and Competition Act timelines generally do not conflict. It noted that CCI typically approves combination proposals within 21 working days, with no recorded instance of approval exceeding 120 days, making concerns over extended delays largely theoretical. The Court also observed that combination applications can be submitted at multiple stages, including the Expression of Interest or issuance of RFRP, rather than waiting until the Resolution Plan stage, ensuring CIRP completion within 330 days. In rare cases involving significant AAEC concerns, delays may occur, but these are due to regulatory processes rather than actions of the parties involved. The recent Competition (Amendment) Act, 2023, reducing CCI approval timelines, further supports the feasibility of completing insolvency proceedings within statutory limits. Therefore, the Court found no substantial basis for interpreting the provisions disjunctively, as done by the NCLAT (¶87-99). CoC's Role and Procedural Lapses in AGI Greenpac’s Plan Approval The Supreme Court examined the procedural lapses in the approval process of the AGI Greenpac-HNGIL combination under the Competition Act, emphasizing that prior CCI approval is mandatory before a transaction is finalized. The CCI had initially found AGI Greenpac’s Form I submission incomplete and directed the submission of a detailed Form II, eventually granting approval with voluntary modifications, including the divestment of an HNGIL plant (¶119). However, a key procedural lapse occurred when the CCI failed to issue a mandatory Show Cause Notice (SCN) to HNGIL, the target company, as required under Section 29(1) of the Competition Act, limiting its ability to participate in the review process. The law mandates that all parties to a combination, including the acquirer and the target, must be notified of potential competition concerns to ensure transparency and fairness (¶124-125). The Court further noted that the Competition Act requires a structured fact-finding process, including stakeholder consultations, which was not adequately followed in this case. The failure to properly scrutinize and notify all relevant parties before approving the combination raised concerns about whether market competition was sufficiently protected (¶129). Additionally, the Court highlighted that Regulation 25(1A) of the Combination Regulations mandates that any voluntary modification to a combination, such as divestment, must have the approval of both the acquirer and the target company to protect stakeholder interests. This requirement is not a mere procedural formality but a substantive safeguard, ensuring that modifications do not undermine the operational and structural integrity of the target company. In this case, the proposed divestment of the target’s plant was a crucial part of its revival under the IBC, making the target company’s active participation essential for compliance with both insolvency and competition laws. Given these deficiencies, the Court emphasized that the lack of participation by the Target in the voluntary modification process, especially where the modification entails the divestment of their assets, vitiates the approval granted by the CCI and warrants remedial intervention by this Court (¶136-139). Justice SVN Bhatti’s Dissenting Opinion: Literal vs Purposive Interpretation (¶¶ 37-42) Justice Bhatti analyzed the principle of literal interpretation, stating that statutory words must be given their ordinary meaning unless such an approach results in absurdity or contradicts legislative intent (¶38). He cited Madhav Rao Scindia vs Union of India (AIR (1971) SC 530), emphasizing that words can have multiple shades of meaning, requiring interpretation in context (¶39). Referring to Corp of the City of Victoria vs Bishop of Vancouver Island (AIR (1971) SC 530), he explained that purposive interpretation is necessary to avoid inconsistency and ensure statutes remain workable (¶41). He held that rigid literalism should not obstruct the IBC’s objective of efficient insolvency resolution (¶42)?. Interpretation of Section 31(4) and its Proviso (¶¶ 52-55) Justice Bhatti examined the amendments introduced by Act 26 of 2018, particularly the insertion of the proviso to Section 31(4). He noted that the IBC was designed to enhance India’s business environment, and the amendment aimed to clarify that Competition Commission of India (CCI) approval must be obtained before CoC approval (¶52). However, he reasoned that external aids such as explanatory notes and legislative history should be considered only after analyzing the provision's language and intent (¶54). He referred to Essar Steel India Ltd. (2020) 8 SCC 531) to highlight the importance of CoC’s commercial wisdom and the Adjudicating Authority’s role in ensuring statutory compliance (¶55)?. Timing of CCI Approval and Effect on Resolution Applicants (¶¶ 65-66) Justice Bhatti emphasized that while CCI approval is essential before final adjudication under Section 31, its absence at the CoC approval stage does not invalidate the resolution plan. He pointed out that mandating CCI approval before CoC voting could exclude viable applicants and hinder competition, thereby reducing asset value maximization (¶65). He held that the phrase “prior to” in the proviso to Section 31(4) is a temporal expression that should be interpreted flexibly, allowing CCI approval to be obtained before Adjudicating Authority approval rather than at the CoC stage (¶66)?. Judicial Precedents and the Role of Adjudicating Authority (¶¶ 78-81) Justice Bhatti referred to NCLAT rulings in ArcelorMittal (2019 SCC OnLine NCLAT 920), Vishal Vijay Kalantari (2021 SCC OnLine SC 3243), and Makalu Trading Limited (2020 SCC OnLine NCLAT 643), where it was held that Section 31(4) is directory. He asserted that commercial wisdom of the CoC should not be constrained by regulatory conditions that can be addressed later in the process (¶78). He concluded that the consequences of non-compliance with combination approval requirements should be assessed at the Adjudicating Authority stage, ensuring adherence to both the IBC and Competition Act without disrupting the resolution process (¶79-81)? The Supreme Court ruled that prior approval of the CCI is mandatory before the CoC considers a Resolution Plan involving a combination. It held that the approval of AGI Greenpac’s Resolution Plan was legally invalid, as it lacked CCI clearance at the time of CoC approval. The Court remanded the matter to the NCLT to reconsider the Resolution Plans in compliance with statutory provisions. Prepared by Iram Jan Communications Division| Supreme Court of India © Supreme Court of India
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5 |
02-01-2025 |
URMILA DIXIT vs SUNIL SHARAN DIXIT
C.A. No. 10927/2024 |
Right of a senior citizen to claim back their transferred property under the Section 23 of the Maintenance and Welfare of the Parents and Senior Citizens Act, 2007 |
URMILA DIXIT V. SUNIL SHARAN DIXIT 2025 INSC 20 (2 January 2025) Justices: Justice Sanjay Karol and Justice Chudalayil T. Ravikumar Question(s): (i) Whether a property transferred by senior citizens by gift or any other medium can be claimed back under the Section 23 of the Maintenance and Welfare of the Parents and Senior Citizens Act, 2007 (“the Act”). (ii) Whether the authorities under the Section 23 of the Act can order eviction from the property and grant the possession to the concerned senior citizens. Factual Background: Section 23 of the Act states that if the person who received property fails to take care of the giver, the transfer can be canceled, as if it were obtained by fraud or force. A Gift Deed was executed by the mother in favour of her son on 7 September 2019 of the property which she had purchased on 23 January 1968. The Deed stated that the son would maintain the mother and the same was registered on 9 September 2019. Allegedly, the same day a vachan patra/promissory note was executed by the son stating that he will take care of the mother and father till the end of their life and if he does not do so, the mother will be at liberty to take back the Gift Deed.
On 24 December 2020 the mother filed an application under the Section 23 of the Act before the Sub Divisional Magistrate alleging attacks by the son regarding the further transfer of property, and sought cancellation of the Deed as there was no love and affection left between the parties. This application was allowed by the Sub Divisional Magistrate and the deed was declared null and void (not valid in law). However, the son preferred an appeal which was dismissed on 25 April 2022 by the Collector. Subsequently, the son filed a writ petition before the High Court of Madhya Pradesh. A Single-Judge Bench upheld the order of the Collector and dismissed the writ petition. The son then filed a writ appeal, and a Division-Bench of the High Court reversed the order of the Single-Judge and found the deed valid. Consequently, the mother filed an appeal in the Supreme Court.
Decision of the Supreme Court: A Two-Judge Bench of the Supreme Court upheld the decision of the Single-Judge Bench of the High Court and the authorities below and cancelled the Gift Deed because the conditions in the gift were not complied with. The Court also ruled that the authorities while exercising jurisdiction under the Section 23 of the Act can order possession to be transferred. The judgment of the Court was authored by Justice Karol.
Reasons for the Decision: Liberal interpretation of the Act The Supreme Court held that the objective of the Act is to empower senior citizens to secure their rights promptly when they transfer a property subject to the condition of being maintained by the transferee (¶25). The Court referred to K. H. Nazar v. Mathew K. Jacob, (2019 INSC 1100), in which it was held that the provisions of a beneficial legislation have to be interpreted with a purpose-oriented approach and the problem that a statute was designed to remedy should first be identified and then a meaning that resolves the problem should be adopted (¶9).
The Supreme Court ruled that the Statement of Object and Reasons and Preamble of the Act embodies the intent of the Act which is to ensure effective maintenance and welfare of parents and senior citizens, guaranteed and recognised under the Constitution (¶12). Therefore, the Act is a beneficial legislation aimed at securing the rights of senior citizens in view of the challenges faced by them and must be given a liberal meaning to it (¶14). The Court observed that it is the social obligation of the children to maintain their parents when they need them and it is bound by the Constitution to advance the cause of social justice pertaining to maintenance of parents or wife (¶¶15-16).
Application of Section 23 of the Act The Supreme Court, after scrutinizing the Gift Deed and Promissory Note, held that the two ingredients necessary for the application of the Section 23, as propounded in Sudesh Chhikara v. Ramti Devi, (2022 INSC 1257), i.e., the transfer should have a condition attached to it regarding maintenance and basic needs, and the transferee has failed to provide such amenities and physical needs to the transferor, were fulfilled in the present case. The Supreme Court thus held that both documents had a condition of maintenance of the mother by the son, which was not honored (¶¶ 20-23). The Supreme Court held that the purpose of the Act is to provide speedy, simple, and inexpensive remedies for the elderly, and therefore the authorities under the Section 23 of the Act have the power to order eviction and grant possession of the property to the concerned senior citizens (¶24). Prepared By: Rudrakshi Sharma (Intern) Centre for Research and Planning, Supreme Court of India
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