Criminal Law - Drugs and Cosmetics Act – Non-standard Quality Drug – Quashment of Complaint – Jurisdiction of Magistrate – Complaint filed against manufacturer alleging offence under Section 18(a)(i) punishable under Section 27(d) of the Act for manufacture of drug not of standard quality – Petitioner contended that offence falling under Chapter IV could be tried only by Court of Sessions in view of Section 32 – Held: Section 36-A provides for summary trial by Judicial Magistrate First Class specially empowered where punishment does not exceed three years – Saving clause under Section 32(2) applies – Chief Judicial Magistrate duly empowered under SRO 44 of 2006 competent to try the offence – Objection rejected [Paras 12–14].

Drugs Sample – Compliance with Section 23(4) – Supply of Sample to Manufacturer – Petitioner alleged non-furnishing of portion of drug sample by Drugs Inspector – Record showed that copy of test report and sample were furnished to petitioner vide communication dated 25.06.2012 – Petitioner responded disputing report and sought retesting – Sample retested by Central Drugs Laboratory, Calcutta and again found not of standard quality – Held: Mandatory requirement of Section 23(4) duly complied with – Plea factually incorrect [Paras 15–16].

Cognizance – Application of Mind – Validity of Order – Initial order of cognizance passed by Mobile Magistrate was cryptic – However, upon transfer of case, Chief Judicial Magistrate passed fresh order dated 17.10.2015 after considering allegations and material on record – Prima facie offence found and process issued – Held: Subsequent order reflects due application of mind and cures earlier defect – Challenge rejected [Paras 17–18].

Inherent Powers – Section 482 CrPC – Scope – Petition filed at advanced stage when trial was almost complete – No abuse of process or miscarriage of justice demonstrated – Held: No ground made out for exercise of inherent jurisdiction to quash proceedings [Paras 9, 19].

Decision: Petition dismissed – Criminal proceedings before Chief Judicial Magistrate, Srinagar upheld – Interim directions vacated [Para 19].

Service Law – Municipal Recruitment – Sanitation Workers – Daily wage CLR workers with long years of service permitted to participate in selection pursuant to interim court orders – Selection conducted on merits along with Employment Exchange candidates – Wider zone of consideration permissible – No illegality in appointing daily wagers who succeeded in selection – Employment Exchange-only restriction not absolute – Writs by daily wage workers allowed; writs by Employment Exchange candidates dismissed [Paras 19–27].

Regularisation – Daily Wage / CLR Workers – No automatic right to regularisation – However, when daily wage workers were allowed to participate in a full, competitive selection process and emerged successful, their appointment cannot be denied – Distinction drawn between “regularisation as of right” and “appointment after due selection” [Paras 19–21].

Employment Exchange – G.O. dated 22.04.1982 – Employment Exchange sponsorship mandatory in ordinary circumstances – However, following Excise Superintendent v. K.B.N. Visweshwara Rao principle, Employment Exchange cannot be sole channel – Fair selection requires wider notification or inclusion of eligible workers – Daily wage workers validly included in selection pursuant to Court order – No bar to considering them on merit [Paras 20–22].

Constitutional Law – Equality in Public Employment – Restricting selection exclusively to Employment Exchange candidates may deprive eligible persons of opportunity – Court relied on Visweshwara Rao to uphold broader zone of consideration – Selection found fair, merit-based, and uniform for both groups [Paras 21–23].

Recruitment Process – Validity – Municipality produced consolidated select list; no allegation of exclusion, bias or mala fides – All candidates (Employment Exchange nominees + CLR workers) evaluated under same criteria – Selection upheld as lawful [Para 23].

Relief – Petitioners (CLR workers) in WP(C) Nos. 15142 & 15146/2023 directed to be appointed as Substitute Sanitation Workers as per merit list – WP(C) 15500/2023 & 20483/2025 (Employment Exchange candidates) dismissed except to extent selected candidates among them will be appointed – WP(C) 37605/2024 partly allowed with direction to include CLR workers with >10 years’ service in future selection in Thrippunithura Municipality [Final Paras].

Criminal Law – Police Harassment – Herbal Hookah in Restaurant – Petitioner alleged police interference with lawful restaurant operation citing alleged sale of tobacco-laced hookah – Petitioner claimed use of only herbal substances without nicotine – Held: Police not to interfere with restaurant business unless illegal activity is found – Direction issued to petitioner to approach FSSAI for certification [Paras 1-3, 7-8]

Tobacco Control – COTPA Act – Section 4A – Hookah Bars – State amendment prohibits hookah bars – Whether petitioner’s hookah product contains tobacco or nicotine is a factual issue to be verified by competent authorities – Held: Court cannot act on mere oral claims – Matter to be decided by FSSAI and not by the Court [Paras 5-6]

Food Safety – Jurisdiction of FSSAI – Products inhaled via hookah without tobacco/nicotine fall within the definition of “food” under Section 2(za) of the Food Safety and Standards Act, 2006 – FSSAI to test samples and verify composition – If product is free of tobacco/nicotine, petitioner can continue operating hookah bar [Paras 6-9]

Police Powers – Surveillance vs Harassment – Though restaurant is located near educational institutions, police can only act if illegal activities are found – General interference in routine lawful business not permitted – Police liberty preserved to act if any illegality is detected [Paras 4, 10]

Decision: Petition disposed of – Petitioner directed to approach FSSAI with product ingredients – Police restrained from interference in lawful business unless illegality is found – Petitioner at liberty to continue business if products are certified tobacco/nicotine-free [Para 8]

Criminal Law – Attachment Order - Prevention of Money Laundering – Attachment of Property – Flat purchased by respondent through unregistered agreement from a company under winding-up – Tribunal quashed ED's attachment – High Court held that no valid title passed through unregistered agreement – Held: Respondent had no ownership; property continued to vest with United Breweries (Holdings) Ltd – Flat rightly attached as proceeds of crime under Section 2(1)(u), PMLA – Tribunal erred in ignoring legal position on title transfer and statutory scheme under PMLA [Paras 25, 34–40, 42, 46–47]

Winding Up – Void Transactions – Agreement to Sell entered after winding-up petition filed – No leave of Company Court taken – Held: Transaction void under Section 536(2), Companies Act – Official Liquidator’s no objection was not bona fide – Registration of sale deed during pendency of restoration proceedings held invalid [Paras 36–37, 46]

Property Law – Ownership – Unregistered Agreement to Sell – Mere agreement does not confer title – Held: As per Section 54 of the Transfer of Property Act and Suraj Lamp case, only registered conveyance creates ownership rights – Buyer at best had a right to seek specific performance – Respondent had no legal interest in property [Paras 38–41]

PMLA – Procedural Compliance – Freezing and Attachment – Provisional attachment by ED was in accordance with Section 5 and confirmed by Adjudicating Authority – High Court reiterated importance of procedural safeguards under PMLA – Cited Opto Circuits (2021) 6 SCC 707 to reaffirm that failure to follow mandatory procedure renders freezing invalid – In present case, ED complied fully [Paras 21–24]

Restoration of Property – Public Sector Banks – Banks holding public funds passed stringent tests under PMLA – Special Court ordered restoration of attached assets to bank consortium – Respondent suppressed facts during sale deed registration – Held: Conduct not bona fide, undermined pending PMLA and winding-up proceedings [Paras 44–45]

Decision: Appeal allowed – Order of Appellate Tribunal quashing attachment set aside – Flat No. 7A held to be validly attached as proceeds of crime – Respondent held to have no title – Sale deed executed during pendency of proceedings declared invalid.

Criminal Law - Money Laundering – Freezing of Property – Requirement of "Reason to Believe" – Section 17(1A), PMLA – Freezing orders dated 05.09.2018 passed by ED under Section 17(1A) were held invalid as they were based solely on "suspicion" without material or reasons recorded in writing – Court held "suspicion" is not equivalent to "reason to believe" and cannot justify action under PMLA – Procedural non-compliance with Rules 3 and 4 of the 2005 Freezing Rules also found – Held: Orders unsustainable in law [Paras 59–67]

Attachment Proceedings – Section 8(3), PMLA – Misreading of 90-day Clause by Tribunal – Tribunal’s interpretation that investigation must be completed within 90 days under Section 8(3)(a) was held erroneous – Court clarified: 90-day limit pertains to duration of attachment/retention during investigation, not to the investigation itself – Held: No statutory time limit prescribed for completion of investigation under PMLA [Paras 37–42]

Property Freezing – Whether Person Must Be Accused – Respondent not named as an accused, but husband was – Court followed Union of India v. J.P. Singh and held that continuation of freezing under Section 8(3) does not require the person holding property to be an accused, as long as property is linked to alleged money laundering and prosecution complaint is pending [Paras 45–48]

Procedural Safeguards – Violation of Section 17 and Related Rules – Freezing orders failed to show compliance with mandatory procedure under Section 17(1), (1A), and (4) – No proper “reason to believe”, no material disclosed to Adjudicating Authority as required – Court reiterated that freezing impacts right to property under Article 300A and strict adherence to procedure is essential [Paras 52–68]

Function of Adjudicating Authority – Misapplication of Terminology – Confusion Between Retention, Continuation, Confirmation – Court found the adjudicating authority’s orders mechanically reproduced pleadings and failed to apply mind – Incorrect terminology used (retention granted when continuation was sought) – Held: Process vitiated due to non-application of mind and procedural errors [Paras 71–79]

Statutory Interpretation – Specific Terms Not Interchangeable – Court clarified that terms such as "freezing", "retention", "continuation", and "confirmation" are distinct and refer to different statutory processes – Lumping them together renders the orders legally defective [Paras 74–75]

Decision: Appeals dismissed – Freezing orders held illegal and procedurally defective – Tribunal’s decision to unfreeze accounts upheld – Procedural safeguards under PMLA not followed – ED’s reliance on suspicion without material held unsustainable – Pending applications disposed of – No costs awarded.

Negotiable Instruments – Section 138 Conviction – Revisional Jurisdiction – High Court cannot re-appreciate evidence under Art. 227/Section 482 CrPC – Change of company name does not invalidate complaint – Authorised representative proved – Defence payments not proved – Concurrent findings upheld – Revision dismissed [Paras 25–33].

Negotiable Instruments – Dishonour of Cheque – Ingredients Established – Conviction Proper – Complainant proved supply of goods, issuance of cheque, dishonour for “Insufficient Funds”, service of statutory notice, and failure to pay within statutory period – Petitioners did not dispute issuance of cheque nor reply to notice – Defence of prior payments (Rs.1,00,000/– and Rs.2,00,000/–) unsupported by admissible evidence – Held: All statutory ingredients of Section 138 NI Act satisfied; no perversity in concurrent conviction [Paras 22–25].

Revisional/Supervisory Jurisdiction – Article 227 & Section 482 CrPC – No Re-Appreciation of Evidence – Revisional/supervisory power is limited to correcting jurisdictional errors, perversity, patent illegality or miscarriage of justice – High Court cannot act as a second appellate court or reassess credibility of witnesses – Interference only if findings are based on no evidence or are manifestly perverse – Held: No such infirmity shown; revisional challenge rejected [Paras 26–30].

Corporate Law – Change of Company Name – Complaint in Old Name Maintainable – Complainant company’s subsequent change from “Ltd.” to “Private Ltd.” does not invalidate proceedings already instituted – Rights and liabilities of old entity vest in new entity by operation of Section 23(1) of Companies Act, 1956 – Pending proceedings may continue in old name – Held: Complaint not defective; no requirement to amend cause title; authorised representative validly proved by board resolutions (Ext.1/1) [Paras 31–32].

Authorisation to Represent Company – Valid Board Resolution – Complaint Maintainable – Complainant produced board resolution authorising initial representative; upon his departure, fresh resolution authorised PW-1 – Held: Proper authority established; objection meritless [Para 31].

Case Law Relied Upon – Applicability – Decisions cited by petitioners on non-existence of complainant company, lack of authority, and presumption rebuttal held inapplicable on facts; defence failed to rebut statutory presumption under Sections 118 & 139 NI Act [Paras 25, 31].

Result – Revision Dismissed – Interim Orders Vacated – Trial Court to Proceed – No grounds to interfere with concurrent findings – C.R.R. 4568 of 2023 dismissed; interim order vacated; Trial Court to act on server copy [Paras 33–36].

Preventive Detention – Verification of In-Camera Statements – Subjective Satisfaction – Petitioner challenged preventive detention under MPDA Act alleging non-compliance with procedural safeguards – Contended that Detaining Authority failed to personally verify in-camera statements of witnesses – Held: It is not a legal requirement that the Detaining Authority must personally verify in-camera statements – Verification by a senior police officer such as Assistant Commissioner of Police suffices and provides necessary procedural safeguard – Assistant Commissioner personally interacted with witnesses, visited incident spot, and verified genuineness of statements – Detaining Authority perused entire record, including verification report, and recorded subjective satisfaction [Paras 4–11].

Preventive Detention – Procedural Safeguards – Compliance with Legal Requirements – Grounds of detention, in-camera statements, and verification report were supplied to the detenu – Detaining Authority noted and considered all relevant material before passing the detention order – Detention order satisfies requirements of Section 8 MPDA Act and Article 22(5) of the Constitution – No breach of procedural safeguards found [Paras 6–10, 12].

Judicial Review – Subjective Satisfaction – Scope – Courts cannot substitute their own opinion for the subjective satisfaction of Detaining Authority – Reasonableness of satisfaction is not to be tested objectively – Judicial interference not warranted unless procedural illegality or arbitrariness is established – Held: No infirmity found in detention order – Petition lacks merit [Paras 5, 12–13].

Decision: Petition dismissed – Rule discharged – Interim application also disposed of as infructuous.

Employees Compensation – Territorial Jurisdiction – Dismissal of Claim – Appellants challenged dismissal of compensation claim by Commissioner, Thane, for want of territorial jurisdiction – Deceased claimant initially resided in Thane when application was filed but later shifted to Uttar Pradesh – Employer based in Gujarat and accident occurred in Gujarat – Insurance company had branch office at Thane – Held: Though the employer’s registered office was not at Thane, the claimant’s ordinary residence at the time of filing and the insurer’s business presence in Thane established territorial jurisdiction – Commissioner’s rejection on jurisdictional ground was incorrect – Hyper-technical approach must be avoided in beneficial legislation like EC Act [Paras 6, 14, 38-43].

Substantial Question of Law – Appeal under Section 30 EC Act – Whether dismissal on ground of territorial jurisdiction raised substantial question of law – Held: Interpretation of ‘ordinary residence’ and relevance of insurer’s business presence involve substantial legal issues – Commissioner failed to consider this appropriately – Findings liable to be set aside [Paras 8, 11-13].

Insurance Law – Coverage under Vehicle Package Policy – Risk of employment injury covered under Employees’ Compensation Act – Insurer’s liability contractual and enforceable – Presence of insurer’s branch office, though not specified under EC Act, relevant in light of CPC principles – Insurer entitled to support Commissioner’s findings despite not raising territorial objection earlier [Paras 22-28, 40-41].

Remand – Improper Dismissal – Commissioner’s findings on employment and accident not interfered with – Matter remanded to determine compensation and apportionment of liability between employer and insurer – Appeal partly allowed [Paras 43-44].

Decision: Appeal partly allowed – Dismissal of claim on territorial jurisdiction grounds set aside – Matter remanded to Commissioner for hearing on compensation and liability – Final disposal directed within three months from 23rd November 2025.

Workmen’s Compensation – Liability of Insurance Company – Compensation and Interest – Deceased driver died during employment-related accident – Commissioner held both employer and insurer jointly liable for ₹8,52,160/- with 9% simple interest till award and 7% compound interest thereafter – Held: Insurer liable to pay entire compensation along with 12% interest under Section 4A(3)(a) of the Workmen’s Compensation Act – Joint liability modified accordingly [Paras 1–4, 6–8].

Insurance Law – Scope of Liability – Penalty Exclusion – Reiterated that interest on delayed compensation forms part of insurer’s liability but penalty under Section 4A(3)(b) is not – Penalty arises from employer’s personal fault and cannot be foisted on insurer – Commissioner’s award modified to clarify insurer’s exclusive liability for compensation and interest only [Paras 7, 7.1, 8].

Precedents – Apex Court Binding – Court relied on Supreme Court judgments in Ved Prakash Garg v. Premi Devi (1997) 8 SCC 1, Kamla Chaturvedi v. National Insurance Co. (2009) 1 SCC 487, and New India Assurance Co. v. Harshadbhai Amrutbhai Modhiya (2006) 5 SCC 192 – Held: Legal position settled that insurer covers compensation and statutory interest but not penalty – Binding precedents followed to allow appeal in part [Paras 4, 7–8].

Decision: Appeal allowed – Order modified – Insurance company held liable to pay ₹8,47,160/- compensation with 12% interest – Remaining portion of Commissioner’s order unaltered.