Income Tax – Section 14A Disallowance – Mandatory Recording of Satisfaction – Disallowance Deleted – The Assessing Officer disallowed ₹5,07,04,000 under Section 14A read with Rule 8D – Held: AO failed to record any dissatisfaction with assessee’s claim of no expenditure incurred in earning exempt income – In absence of proper satisfaction as mandated under Section 14A(2), invocation of Rule 8D not justified – Disallowance liable to be deleted [Paras 9–12].

Rule 8D – Precondition of AO’s Satisfaction – Procedural Safeguard – Not Optional – The court reiterated that Rule 8D can be invoked only after AO records dissatisfaction with assessee’s computation of expenditure – Satisfaction must be based on objective analysis, not merely a ritual formality – Lack of such satisfaction renders the disallowance unsustainable in law [Paras 9–11].

Precedent – Reliance on Supreme Court Judgment – Decision Followed – The Court relied on Supreme Court judgment in Godrej & Boyce Mfg. Co. Ltd. v. DCIT, (2017) 394 ITR 449 (SC) – Held: AO’s mechanical application of Rule 8D without recording reasons violates settled law [Para 11].

Decision – Disallowance under Section 14A Deleted – Appeal Allowed – The impugned order confirming disallowance set aside – Appeal of assessee allowed with no order as to costs [Para 13].

Arbitration Law – Interim Measure – Section 9 Arbitration Act – Relief Granted – The Petitioner sought interim protection to secure claims arising out of breach of a Gas Supply Agreement (GSA) where the Respondent failed to meet the Minimum Guaranteed Offtake (MGO) – Held: Under Section 9, the Court is empowered to grant interim measures for protection of contractual rights and to prevent frustration of arbitration – Relief granted in form of partial deposit and disclosure of assets [Paras 29-31].

Minimum Guaranteed Offtake (MGO) – Liquidated Damages – Enforceable Contractual Provision – The GSA provided for liquidated damages in case of shortfall in gas offtake – The Respondent argued that such damages were in the nature of penalty – Held: Where parties agreed on a clear formula and rate, such clauses are enforceable and do not constitute penalty per se – Prima facie, Petitioner established breach and entitlement [Paras 26-28].

Securing Arbitrable Claims – Balance of Convenience – The Court assessed whether a prima facie case was made out, and whether irreparable injury would be caused if interim protection was denied – Held: Respondent's financials showed insufficient liquidity; petitioner’s right needed safeguarding pending arbitration – Ordered Respondent to deposit ₹1.25 Crores and disclose assets [Paras 31-34].

Section 9 vs. Final Relief – Scope Clarified – The Court reiterated that a mini-trial is impermissible under Section 9 – However, where the claim is clear, liquidated, and based on an admitted contract, interim protection can be granted to safeguard the arbitration outcome [Para 27].

Interim Protection – Conditions for Grant – Application Partly Allowed – The Court partly allowed the petition by directing the Respondent to deposit ₹1.25 Crores with the Registrar General and disclose assets – Remaining prayers including attachment of property were declined at this stage [Paras 35-36].

Criminal Law – Appeal Against Conviction - Sections 376(2), 366A IPC, and Section 6 of POCSO Act - Testimony of Child Victim – Credibility and Sufficiency – Conviction Upheld – The child victim aged about 5 years clearly narrated that the appellant lured her to his house under the pretext of giving her toffees and inserted his finger into her vagina and bit her cheeks – The Trial Court found her competent to testify – Her testimony was consistent and categorical, corroborated by medical evidence noting fresh hymenal tear and bloodstains – No evidence was led to establish tutoring or motive of false implication – Held: Sole testimony of the child, found credible and reliable, is sufficient for conviction under Section 376(2) IPC and Section 6 POCSO – Appeal dismissed [Paras 7–9, 11, 17].

POCSO Act – Presumption under Section 29 – Applicability – Section 29 of POCSO creates presumption of guilt once foundational facts are established – In this case, foundational facts were proven through credible testimonies of child victim and parents, along with medical evidence – Defence of false implication owing to quarrel over water found unsubstantiated – Held: Presumption under Section 29 applies; appellant failed to rebut it [Paras 15–17].

Evidence Law – Corroboration of Child’s Testimony – Not Mandatory – The Supreme Court rulings in State of M.P. v. Balveer Singh, State of Punjab v. Gurmit Singh, and Ganesan v. State reaffirmed that child victim’s testimony does not require corroboration if found reliable – Trial Court satisfied with child’s competence; demeanour and consistency upheld during cross-examination – Held: Conviction can rest solely on such testimony [Paras 12–14].

Appeal – Dismissal – Sentence and Conviction Affirmed – The appellant’s plea of false implication due to prior quarrel not substantiated – No material contradiction found in testimonies – Medical evidence consistent – Inconclusive FSL report not sufficient to rebut credible oral and documentary evidence – Held: No merit in appeal – Conviction and sentence upheld [Paras 11, 17].

Examination Law - Civil Writ - OMR Evaluation – Incorrect Bubbling of Roll Number – DSSSB Exams – Petitions filed against conflicting CAT orders involving identical issues – One candidate’s OMR sheet was evaluated despite incorrect bubbling and later rejected, while the other’s was not evaluated at all – Held: If the OMR was already evaluated and candidate declared successful, later rejection is impermissible; where OMR was not evaluated due to technical default, no relief can be granted [Paras 1-5, 35-36, 42-46, 56].

Procedural Error – Evaluation of OMR Answer Sheets – Candidate Benefited by Prior Evaluation – Relief Granted - In W.P.(C) 1282/2025 (Kusum Gupta), despite bubbling error, candidate’s OMR sheet was evaluated and she was shortlisted – Later rejection deemed arbitrary – Directed that appointment letter be issued subject to eligibility – Entitled to notional benefits without actual pay [Paras 38-43, 56].

Instructions to Candidates – Mandatory Nature – Mistakes in Bubbling Roll Number – Strict Compliance Required - In W.P.(C) 17595/2024 (Niharika Puhan), OMR sheet not evaluated due to incorrect bubbling – Despite writing roll number correctly in digits, non-compliance with explicit instructions proved fatal – Tribunal’s order set aside – Petition dismissed [Paras 31-33, 49-53, 55].

Relief Limited to Litigating Candidate – No Reopening of Entire Result - Court clarified that similar candidates disqualified for identical reasons cannot claim automatic relief unless they have approached Tribunal/Court – Judgment confined to litigating party [Paras 47-48].

Role of Invigilators – Countersigning OMR – Responsibility to Detect Errors – Considered but Not Determinative - Though Court noted invigilator countersigned the OMR sheets, this factor alone does not excuse candidate’s responsibility to fill details accurately [Paras 36-39].

Decision – Petition by DSSSB in W.P.(C) 17595/2024 Allowed – Tribunal’s Order Set Aside – Petition by Kusum Gupta in W.P.(C) 1282/2025 Allowed – DSSSB Directed to Issue Appointment Letter within Eight Weeks – Relief Limited to Present Litigants [Paras 55-57].

Civil Law - Will Interpretation – Life Estate vs Absolute Ownership – Section 82 of the Indian Succession Act – Appeal Dismissed – The appellants challenged the dismissal of their partition suit, contending that Clause 4 of the Will conferred absolute ownership upon their mother – The Court held that despite the use of the words "absolute and exclusive," a holistic reading of the Will indicated only a limited life estate was intended, with remainder in favour of the son – Held: Will must be interpreted harmoniously; absolute ownership was not conferred [Paras 7, 12-14, 22].

Testamentary Intent – Will Authored by Layperson – Legal Language Not Controlling – Interpretation Relaxed – The Will was personally typed by the Testator, a layman – The Court emphasized that in such cases, the intention behind the words is more relevant than their strict legal meaning – Held: Use of legal terms such as “absolute” does not by itself imply absolute ownership unless supported by entire instrument [Paras 13-14].

Hindu Succession Act – Section 14(1) Not Attracted – No Pre-Existing Right Claimed – The appellants’ plea that the widow became full owner under Section 14(1) of the Hindu Succession Act was rejected – Held: No such plea or issue was raised before the Single Judge and hence cannot be pressed at appellate stage [Paras 16-17].

Contradictory Clauses – Section 88 of Indian Succession Act – Preference to Later Clause – Harmonious Construction – Court reiterated that where two clauses appear contradictory, the later clause prevails, and an effort must be made to read them harmoniously – Held: Clauses 7 to 9 override Clause 4 in so far as they show a clear intent of life estate with remainder to son [Paras 12, 14-15, 22].

Decision – Appeal Dismissed – No Error Found in Trial Court Judgment – The Appellate Court affirmed the judgment of the Single Judge and held that the partition suit had rightly been dismissed – Held: No absolute estate was bequeathed to the widow; limited life interest was validly construed from the Will [Para 23].

Arbitration Law – Scope of Judicial Review – Section 34, Arbitration and Conciliation Act – Limited Interference – Court reiterated that scope under Section 34 is narrow – Award can only be set aside on grounds specified such as conflict with fundamental policy of Indian law or violation of most basic notions of justice – Court does not sit in appeal or re-appreciate evidence if Arbitrator has taken a plausible view [Paras 25-28].

Counter-Claim – Requirement of Pleadings – Section 23(2A), Arbitration Act – Arbitrator Erred – Petitioner had specifically pleaded counter-claim of Rs. 11.88 crores in reply with basis of calculation – Respondent in rejoinder categorically denied same – Held: Existence of averments and denial created a dispute requiring framing of an issue – Arbitrator’s refusal to frame issue only because counter-claim was not in prayer clause was erroneous – Pleadings to be read as whole, not in bits – Failure to frame issue violated principles of adjudication [Paras 29-32, 41-42].

Counter-Claim – Opportunity to Cure Defect – Arbitrator’s Duty – Even if defect of absence of prayer was present, Arbitrator ought to have directed petitioner to rectify pleading rather than reject counter-claim outright – Reliance placed on Union of India v. Tata Teleservices (Maharashtra) Ltd., (2007) 7 SCC 517 – Held: Denial without affording opportunity shocks conscience of Court [Paras 15-16, 45-46].

Evidence – Non-Framing of Issue – Effect – Once counter-claim was not made an issue, petitioner had no opportunity to lead evidence – Arbitrator’s later observation that petitioner failed to prove loss untenable – Evidence can only be led on framed issues – Finding against petitioner unsustainable [Paras 47-48].

Public Policy – Fundamental Policy and Notions of Justice – Award set aside – Failure to frame issue on counter-claim despite specific pleadings and rejoinder denial constitutes violation of fundamental policy of Indian law and most basic notions of justice – Award held unsustainable [Paras 50].

Decision – Petition Allowed – Arbitral Award dated 18.06.2010 set aside for being contrary to fundamental policy of Indian law and violative of principles of justice – Petition disposed of [Para 50-51].

Criminal Law – Challenge Conviction under Sections 392/34 and 397 IPC – Acquittal on Account of Unreliable Testimony – Judgment Set Aside – The appellants Naushad and Salman were convicted for robbery under Section 392/34 IPC, with Naushad also convicted under Section 397 IPC based on the complainant’s testimony alleging robbery at gunpoint – The Trial Court relied primarily on the complainant's deposition, despite no recovery of stolen articles or weapon, no independent witness, and inconsistencies between the complainant’s version and the police account – The High Court found material contradictions and improvements in the complainant's statements, including the delayed mention of a firearm, lack of description of the accused, and failure to explain urgency for delay in reporting – Held: Prosecution evidence unreliable and not of sterling quality – Conviction set aside – Both appellants acquitted [Paras 1–15].

Criminal Trial – Inconsistent Testimony – Conviction Set Aside – The complainant made material improvements during court deposition which contradicted his initial statements to the police – The use of a pistol was introduced much later – Court held such discrepancies and omissions as significant, rendering the testimony untrustworthy [Paras 6, 9–10].

Evidence – Identification and Test Identification Parade (TIP) – Refusal Not Fatal When Explained – Although appellants declined to participate in the TIP, they stated that police had shown their photographs to unidentified individuals – Court accepted this explanation and noted the complainant had not described the accused initially, making in-court identification unreliable [Para 12].

Recovery – Absence of Weapon and Stolen Property – Prosecution Failed to Establish Link – No recovery of robbed articles or the weapon allegedly used in commission of offence – Pistol found in another FIR was not exhibited in this case – This weakened the evidentiary value of prosecution’s case [Paras 5, 12].

Non-Joining of Public Witnesses – Further Weakening of Prosecution Case – Despite the incident occurring in a public area during the day, no effort was made to include independent witnesses – Court noted that where the sole witness lacks credibility, such omission becomes significant [Paras 7, 13–14].

Decision – Considering the material contradictions, delayed reporting, unreliable testimony, and lack of corroborative evidence, the High Court set aside the conviction under Sections 392/34 IPC (both appellants) and Section 397 IPC (Naushad) – Appeals allowed – Appellants acquitted [Paras 14–15].

Criminal Law – Appeal Against Conviction - Robbery – Contradictions in Prosecution Evidence – Benefit of Doubt – Conviction Set Aside – Acquittal -Appellants convicted for robbery under Sections 395/34 IPC challenged conviction citing discrepancies in witness testimonies regarding place, time of arrest, and recovery of stolen items – Court found material contradictions in statements of key witnesses, inconsistencies on recovery sources, non-sealing of seized articles, and non-joining of public witnesses despite availability – Such lapses undermined authenticity of prosecution case – Held: Prosecution failed to prove guilt beyond reasonable doubt – Conviction and sentence set aside – Appellants acquitted [Paras 13-14, 17-18].

Criminal Trial – Non-Joining of Public Witnesses – Effect – Failure to associate independent witnesses, despite availability, throws doubt on fairness of investigation – Cited Pawan Kumar v. Delhi Administration (1987) CC 585 DHC – No plausible explanation offered – Adverse inference drawn against prosecution [Para 14].

Standard of Proof – Suspicion Cannot Replace Proof – Reiterated Supreme Court rulings in Wahid v. State (Cr. A. No. 201/2020) and Ashish Batham v. State of M.P. (2002) 7 SCC 317 – Mere suspicion, however strong, is not a substitute for proof beyond reasonable doubt – Benefit of doubt must go to accused [Paras 16-18].

Decision – Appeal allowed – Conviction and sentence under Sections 395/34 IPC quashed – Bail bonds cancelled, sureties discharged [Paras 18-19].

Real Estate – Redevelopment – Rights of Third-Party Purchasers – Appellants sought interim injunctions restraining society and new developer from redevelopment activities, relying on agreements executed with a prior, terminated developer – Held: Appellants have no enforceable rights against society or new developer – Their claims are derivative of the terminated developer and extinguished with termination of development agreement [Paras 3, 15-21, 40]

MOFA – Society as ‘Promoter’ – Privity of Contract – Appellants argued that society qualified as promoter due to development agreement and power of attorney – Rejected – Society’s authorisations to developer were limited – Developer sold flats on its own account – No privity of contract between society and appellants – No liability under MOFA arises [Paras 5, 13, 15, 28-29, 34]

Binding Nature of Precedents – Vaidehi Akash and Goregaon Pearl – Appellants claimed prior rulings were interim and non-binding – Rejected – Court held Division Bench in Deepak Prabhakar Thakoor expressly affirmed principles in Vaidehi Akash – Observations, though termed prima facie, have binding effect as legal determinations after hearing both parties [Paras 14, 22-24, 39]

Doctrine of Irrevocable Agency – Inapplicability – Appellants cited Section 202 of Contract Act and claimed developer had interest in subject matter – Rejected – Developer’s authority under PoA was limited to facilitation of redevelopment – No sale on society’s behalf – Developer sold free-sale flats independently – Section 202 does not apply [Paras 32-34]

MOFA Enforcement – Unregistered Agreements – Limitation of Rights – Appellants cited decisions allowing MOFA enforcement based on unregistered documents – Held: Decisions distinguishable – Present case involves a redevelopment project where the prior developer’s rights were lawfully terminated – No rights survive termination [Paras 36-38]

Arbitral Award – Finality Under Section 35 of Arbitration Act – Appellants bound by final arbitral award upholding termination of development agreement – Cannot assert independent rights bypassing that award – Legal remedies lie against erstwhile developer only [Paras 35, 40]

Decision: Appeals dismissed – No privity of contract or statutory liability between society/new developer and third-party purchasers claiming through terminated developer – Trial Court’s refusal of interim relief upheld – Interim protection vacated [Paras 41-44]