Insolvency and Bankruptcy – Section 7 IBC – Procedural Compliance – Affidavit Defect – Application by HDFC Bank under Section 7 IBC was supported by an affidavit dated prior to the date of verification – NCLT rejected the application as non est for not curing defects within time – NCLAT restored the petition but failed to insist on curing the affidavit defect – Supreme Court held that such affidavit-related procedural defects are curable and do not render the application non est – Proviso to Section 7(5)(b) IBC not complied with as notice was not personally served on the applicant bank – Consolidated registry notice was insufficient under IBC standards – Held: Procedural defect did not justify rejection – Respondent to cure defect within seven days and NCLT to proceed on merits [Paras 1-3, 6-7, 10-13, 15, 17, 19-20].

Procedural Law – NCLT Rules and Service of Notice – Rules 28 and 38 – Registry issued consolidated notice listing 26 defective matters including the respondent’s – Supreme Court held that proper statutory notice under IBC must be issued to the applicant, not merely published on the notice board or website – Service on authorized representative does not meet the requirement under Section 7(5)(b) – Procedural rules cannot override the substantive law [Paras 13-16].

Curable Defect – Affidavit in Support – Supreme Court reaffirmed that procedural lapses in affidavit form or date do not automatically nullify the application – Such defects are curable in line with earlier precedents – Rules of procedure should serve justice and not defeat it – Restoration of petition was proper, but direction to cure the affidavit defect should have been made explicit at NCLAT stage [Paras 17-19].

Decision: Appeal partly allowed – Respondent-bank directed to cure defects including affidavit within seven days – NCLT to proceed on merits thereafter – No costs awarded.

Criminal Law – Quashing Of FIR - Rape – Repeated Sexual Acts – Section 376(2)(n) IPC – FIR alleged repeated sexual relations by advocate on false promise of marriage – Supreme Court held that relationship lasted three years and involved mutual affection and voluntary acts – No indication of threat, coercion, or deceit from inception – Held: FIR failed to disclose a pattern of repeated sexual assault as contemplated under Section 376(2)(n) – Allegations lacked essential ingredients of the offence [Paras 20–23, 32–34].

Consent – False Promise of Marriage – Misconception of Fact – Respondent claimed sexual relationship based on false promise to marry – Supreme Court held promise was not shown to be false from inception – Relationship was consensual, continued even after alleged refusal to marry – Court reaffirmed that failed relationship alone does not convert consensual intimacy into rape – Allegations lacked proximate nexus between promise and consent [Paras 24–28, 35–38].

Misuse of Law – Rape Allegation after Relationship Fails – Court expressed concern over trend of failed romantic relationships being retrospectively coloured as rape – Held: Criminal law cannot be used as tool for vendetta or emotional retaliation – FIR was filed months after last alleged incident and after appellant refused to pay ₹1.5 lakhs – Complaint motivated and belated – Quashing warranted to prevent abuse of process [Paras 29–30, 33–34, 40].

Quashing – Prima Facie Offence Not Made Out – Applying Bhajan Lal principles – Allegations, even if taken at face value, did not constitute offences under Sections 376 or 507 IPC – FIR and chargesheet quashed as continuation of proceedings would amount to injustice and misuse of court machinery [Paras 39–41].

Decision: Appeal allowed – High Court order refusing to quash set aside – FIR No. 294 of 2024 and Chargesheet No. 143 of 2024 quashed – Appreciation recorded for Amicus Curiae.

Arbitration – International Commercial Arbitration – Jurisdiction of Indian Courts – Foreign-seated Arbitration – Section 11 Inapplicable – Petition Dismissed – Disputes between Indian petitioner and foreign respondent governed by Benin-seated arbitration under primary Buyer-Seller Agreement (BSA) – Benin designated as seat and governing law explicitly chosen – Held: Arbitration under BSA is international commercial arbitration – Part I of the Arbitration Act, 1996 excluded – Section 11(6) petition not maintainable – Indian courts lack jurisdiction to appoint arbitrator where foreign seat is chosen [Paras 2, 23–26, 30].

Arbitration – Novation and Supersession – BSA not Superseded by Subsequent Contracts – Sales Contracts and HSSAs are Independent – No Composite Agreement – Separate Arbitration Clauses Not Binding on Respondent No. 1 – Sales Contracts with Respondent No. 2 and High Seas Sale Agreements with Respondent No. 3 are limited, transaction-specific contracts – Do not replace or override BSA – No novation established – Arbitration clauses in ancillary contracts cannot be imported to override BSA terms [Paras 27–29].

Arbitration – Finality and Kompetenz-Kompetenz – Prior Benin Arbitration Culminated in Final Award – Fresh Arbitration on Same Dispute Impermissible – Parallel Proceedings Barred – Benin arbitral tribunal constituted under BSA has rendered final award – Petitioner estopped from initiating parallel arbitration in India – Permitting such effort would violate principle of finality, undermine competence of foreign tribunal, and disrupt territorial jurisdiction of seat courts [Paras 31–32].

Arbitration – Anti-Arbitration Injunction – Dismissal by High Court – Findings Operate as Issue Estoppel – Section 11(6) Petition Precluded – High Court of Delhi dismissed suit seeking to injunct Benin arbitration – Held that BSA and Addendum form principal agreement with Benin seat – Findings on separateness of contracts and lack of composite dispute operate as issue estoppel – Petitioner barred from re-litigating identical issues in Section 11 petition [Paras 33–35, 38].

Group of Companies Doctrine – Misplaced Reliance – No Common Intention or Composite Transaction – Mere Corporate Affiliation Insufficient – No evidence of mutual intention to bind non-signatory respondents to BSA – Distinct contracts, parties, and scopes – Doctrine not applicable absent direct participation or shared negotiation of arbitration clause – Mere common ownership or control through TGI Group insufficient [Paras 40–41].

Decision:

Arbitration Petition dismissed – Disputes governed exclusively by arbitration clause in BSA with seat in Benin – Indian courts have no jurisdiction to appoint arbitrator – Prior Delhi High Court findings bar re-litigation – Group of companies doctrine not attracted – No costs [Paras 42–43].

Environmental Law – River Pollution – Judicial Oversight – Massive pollution of Jojari, Bandi and Luni rivers in Rajasthan due to discharge of untreated industrial and municipal effluents – Supreme Court initiated suo moto proceedings following a documentary exposing environmental and public health catastrophe – Found sustained regulatory failure and prolonged administrative apathy – Held: Right to life under Article 21 includes right to safe water and a healthy environment – State's failure amounted to constitutional violation [Paras 1-3, 10-15, 16-19].

National Green Tribunal – Final Order – Interim Stay Modified – Directions issued by NGT on 25 February 2022, based on the P.C. Tatia Committee report, were stayed by earlier orders – Supreme Court clarified that stay shall continue only in respect of adverse remarks and compensation imposed on State entities – Substantive remedial and regulatory directions revived for immediate implementation [Paras 20-21, 27A-B].

Oversight Mechanism – High-Level Ecosystem Oversight Committee – Committee constituted under Chairmanship of Justice Sangeet Lodha (Retd.) with representatives from Pollution Control Boards, State Departments, RIICO, and District Collectors – Empowered to audit, monitor, enforce and supervise implementation of river restoration and pollution control measures – Directed to submit first report within 8 weeks and periodic reports thereafter [Paras 22-24, 27C-J].

Public Health and Constitutional Rights – Article 21 – Environmental degradation found to directly violate right to life, health, dignity and safe drinking water – Court invoked binding precedents in Subhash Kumar, Virender Gaur, M.C. Mehta and A.P. Pollution Control Board II – Held: Protection of environment is a constitutional imperative, not administrative discretion [Paras 10-15, 28].

Administrative Lapses – Accountability of Authorities – State of Rajasthan’s belated action triggered only after Court intervention – Court noted chronic under-capacity in CETPs and STPs and failure to act on years of expert reports – Directed identification of non-compliant authorities and polluting industries for potential prosecution and cost recovery [Paras 8-9, 18, 26].

Decision: Interim stay on NGT’s final order dated 25/02/2022 modified – Remedial and regulatory directions reinstated for full implementation – High-Level Oversight Committee constituted to prepare and execute river restoration blueprint – State directed to ensure logistical, financial and institutional support – Committee to submit first status report by 27/02/2026 – All state agencies, municipal bodies and industries directed to fully cooperate with the Oversight Committee.

Tenancy Law – Eviction for Non-Payment of Rent – Section 12(1) and 12(3) of Kerala Buildings (Lease and Rent Control) Act – Tenant defaulted in rent payment for over five years and failed to comply with Rent Controller's direction to deposit arrears – Appellate Authority stopped hearing of appeal under Section 12(3) – Held: Repetition of Section 12 procedure in appeal not mandatory – Appellate Authority can rely on Rent Controller's findings and is not bound to conduct fresh proceedings under Section 12(1) – High Court erred in holding otherwise – Power under Section 12(3) operates by force of law [Paras 2, 28–32, 38–42].

Rent Control – Appellate Proceedings – Section 18 – Appellate Authority not court of first instance – Not required to redetermine arrears – May exercise discretion to stay eviction or extend time for compliance – However, where tenant has defaulted persistently and no stay of decree exists, no procedural obligation to grant repeated opportunities to comply – Direction to repeat Section 12 process would frustrate object of statute [Paras 30–32, 39, 41].

Statutory Interpretation – Absurdity in Construction – Law must serve justice, not cause injustice – Interpretation requiring landlords to reinitiate eviction procedure in appeal contrary to purpose of rent control legislation – Courts must avoid interpretations producing unjust or irrational results – Procedural formalism must not override statutory objectives [Paras 33–36].

Tenant Conduct – Long-Term Default – Tenant occupying prime commercial premises in Kochi without paying rent for five years – Despite decree in recovery suit and repeated opportunities, tenant failed to deposit arrears – Procedural objections used to delay lawful eviction – Courts must prevent misuse of statutory protections to defeat landlord’s rights [Paras 45–47].

Appellate Authority – No Fixed Time to Grant Compliance – Argument that Rent Control Appellate Authority must provide four weeks to deposit rent held untenable – No such requirement in Act – Once tenant fails to comply with Rent Controller’s direction, appeal may be stopped – Delay of over seven months sufficient to justify action by Appellate Authority [Paras 43–44].

Decision: Appeals allowed – Judgment of High Court dated 22/05/2025 set aside – Orders of Rent Control Appellate Authority dated 19/03/2025 restored – Respondent-tenant directed to vacate premises by 31/12/2025 on filing undertaking within two weeks – Failing which, landlord permitted to proceed with execution forthwith [Paras 48–49].

Criminal Law – Quashing of Prosecution – Abuse of Process – Arms Licence Scam Allegation – Appellant, an IAS officer and District Magistrate-cum-Licensing Authority, Saharsa, accused of issuing arms licences without due verification – Chargesheet filed after 15 years of FIR, despite earlier closure report finding allegations against him to be false – Sanction under Section 197 CrPC held to be non-speaking and mechanical – Held: Prosecution is liable to be quashed due to inordinate delay, lack of fresh evidence, improper sanction, and violation of Article 21 (right to speedy trial) [Paras 2, 4, 5, 6, 8, 10, 11, 12, 13, 14, 19, 20].

Service Law – Departmental Proceedings – Exoneration – Appellant had been subjected to departmental enquiry for irregularities in issuance of arms licences – Explanation submitted by appellant was accepted and departmental proceedings were closed in 2016 – Held: Discharge from departmental proceedings assumes relevance when criminal prosecution is based on the same facts and there is absence of any act of corruption or criminal conspiracy [Paras 5, 8, 20].

Criminal Procedure – Section 197 CrPC – Sanction for Prosecution – Sanction granted to prosecute appellant was vague, lacking application of mind, and failed to evaluate material evidence – Mere reproduction of statutory language is not sufficient – Held: Sanction must reflect objective consideration of facts and evidence; failure to do so renders sanction order invalid, thereby vitiating cognizance – All consequential actions including chargesheet and cognizance quashed [Paras 10, 11, 12].

Criminal Procedure – Delay in Investigation – Right to Speedy Trial – Delay of 11 years between permission for further investigation and filing of supplementary chargesheet – No explanation offered for such delay – Appellant kept under cloud of criminal prosecution despite earlier closure of case – Held: Delay in investigation constitutes violation of right under Article 21; investigation cannot continue endlessly without justification – Chargesheet and prosecution quashed on this ground as well [Paras 13, 14, 19].

Arms Act – Discretion under Section 13(2A) – Appellant relied on discretionary power to issue licences without police verification if report is not received in time – However, in one instance, licence was issued within 2 days of calling for report – Held: Though such discretion exists, it must be exercised reasonably; one unjustified instance not sufficient for prosecution when other licences not similarly scrutinised and departmental authorities have already accepted explanation [Paras 7, 8, 9, 20].

Criminal Procedure – Supplementary Chargesheet – Further Investigation – Leave granted under Section 173(8) CrPC implies ongoing judicial stewardship – Held: Courts not functus officio after granting such leave – They are duty-bound to ensure investigation proceeds fairly and reasonably – Inordinate delay must be accounted for and explained [Para 21(i)].

Judicial Directions – Delay in Investigation and Sanction – Courts directed to: (i) Ensure investigating agencies explain prolonged delays when highlighted by accused; (ii) Recognise that unreasonable investigation delays can vitiate prosecution; (iii) Ensure sanctioning authorities apply mind to material evidence; (iv) Allow accused or complainant to seek updates or quashing in cases of prolonged or unjustified investigation [Para 21(ii)–(iv)].

Decision: Appeal allowed – Cognizance order and prosecution quashed – Appellant discharged from all criminal proceedings – Pending applications disposed of [Para 20].

Environmental Law – Conservation of Aravali Hills – Need for uniform definition – Aravali Hills and Ranges spanning four states held ecologically vital for biodiversity, desertification prevention, and climate resilience – Dispute arose over differing definitions by states – Court accepted Committee’s recommendation using elevation-based criteria (100m) for defining Aravalis – Court directed preparation of geo-ecological Management Plan for Sustainable Mining (MPSM) across Aravali districts, similar to Saranda study, before any new leases – No mining to be permitted in core/inviolate zones including tiger reserves, Ramsar sites, aquifer zones, and ESZs [Paras 1-5, 29-30, 38, 50].

Mining Regulation – Sustainable Mining – Ongoing mining to continue strictly per Committee’s safeguards – New leases to be withheld till MPSM is finalized – Recommendations for expert monitoring, reclamation of abandoned mines, prohibition in ecologically sensitive areas, and restriction on explosive use accepted – Illegal mining flagged; ILMS system to be implemented for real-time oversight [Paras 7-9, 18, 38, 49-50].

Judicial Oversight – Role of Amicus Curiae – Special Bench constituted to harmonize issues from M.C. Mehta and Godavarman cases – Court recognized and recorded appreciation for Amicus and legal team for their sustained contribution to ecological jurisprudence [Paras 20, 51].

Decision:

Committee Report – Definition of Aravalis – Accepted – The Court accepted the operational definition of Aravali Hills and Ranges as recommended by the Committee constituted by the MoEF&CC, based on elevation from local relief – Court held that this uniform definition will guide mining regulation across Delhi, Haryana, Rajasthan, and Gujarat [Para 50(i)].

Mining in Core/Inviolate Areas – Prohibition Upheld – Mining in designated core/inviolate zones (including protected areas, tiger reserves, Ramsar sites, aquifer zones, areas with government plantations) shall remain prohibited – Exceptions allowed only for critical, strategic, and atomic minerals as per MMDR Act [Para 50(ii)].

Sustainable Mining – Conditional Approval – Recommendations for regulated sustainable mining accepted – Existing legal mining operations allowed to continue with strict compliance of safeguards outlined in Committee Report (Para 8) – No new leases to be granted until a Management Plan for Sustainable Mining (MPSM) is prepared [Paras 50(iii), 50(v), 50(vii)].

Management Plan for Sustainable Mining (MPSM) – Mandatory – Directed MoEF&CC to prepare MPSM for entire Aravali range through ICFRE – Plan to identify zones for mining, conservation, ecological thresholds, and post-mining restoration measures – Only after MPSM finalization can new mining activities be permitted [Para 50(iv)-(vi)].

Ban on New Mining Leases – Interim Restriction – No new mining leases to be granted in Aravalis until MPSM is finalized – Ensures scientific, ecologically sensitive and uniform mining policy across the region [Para 50(v)].

Complete Ban Refused – Blanket prohibition on all mining rejected – Court held total bans may incentivize illegal mining and lead to criminalisation of resource extraction – Maintained that legal mining with proper safeguards should continue [Paras 47-48].

Arbitration – Execution of Award – Objections by Legal Representatives – Arbitral award dated 12.07.2010 passed in favour of appellant was sought to be executed in Bombay against the father’s estate – Legal representatives (uncle and others) challenged execution by asserting non-party status and independent rights in the property – Held: Since the execution was sought against them as executors under the Will, they are not third parties but legal representatives – They are entitled to notice under Order 21 Rule 22 CPC and may raise objections under Rule 23(2) [Paras 14-18].

Civil Procedure – Order 21 Rule 22 CPC – Mandatory Notice – Execution against legal representatives cannot proceed without notice – Use of “shall” in Rule 22 is mandatory and incorporates principles of natural justice – Any step taken without such notice would be without jurisdiction [Paras 14-15].

Letters Patent Appeals – Maintainability – Held: Orders passed in execution proceedings of an arbitral award trace their source to the Arbitration and Conciliation Act, 1996, which is a complete code – Hence, no appeal lies under Clause 15 of the Letters Patent – Orders of Division Bench admitting and staying Single Judge’s orders are without jurisdiction and liable to be set aside [Paras 19, 22].

Execution Proceedings – Premature Observations – Single Judge made findings that arbitral award is not fraudulent, not against public policy etc., while deciding chamber summons – Supreme Court held such observations, though not determinative, may prejudice legal representatives’ right to raise objections once notice under Rule 22 is served – Execution must proceed only after issuing statutory notice [Paras 20-21].

Decision:

Letters Patent Appeals – Held Not Maintainable – Orders dated 06.03.2018 passed by Division Bench of Bombay High Court in LPAs 320 & 372 of 2015 set aside – Appeals dismissed as not maintainable as orders challenged arose from execution proceedings under Arbitration Act which bars such appeals [Para 22].

Execution Direction – Restored to Statutory Track – Supreme Court directed learned Single Judge to issue notice under Order 21 Rule 22(1) CPC to respondents – On receipt, respondents may raise objections under Rule 23(2) CPC – Such objections to be decided independently and uninfluenced by previous Single Judge’s observations in chamber summons orders [Para 22(i)-(iii)].

Debt Recovery – SARFAESI Act – Priority of Secured Creditor – Section 26E of SARFAESI Act grants statutory priority to debts owed to secured creditors post registration – However, this statutory priority does not override a statutory “first charge” under a welfare statute such as EPF&MP Act – Held: While bank’s secured dues get priority over ordinary debts, they remain subordinate to EPF dues which enjoy statutory first charge under Section 11(2) of the EPF Act [Paras 15, 22-27].

Provident Fund Dues – Statutory First Charge – Section 11(2) of EPF&MP Act creates an overriding statutory first charge on employer’s assets for PF dues including contributions, interest, damages – Court holds such first charge prevails over SARFAESI’s Section 26E priority – Welfare legislation like EPF Act must be purposively interpreted in line with Directive Principles [Paras 14, 17, 23, 26-27].

Workmen’s Dues – No Priority in Absence of Quantification – Unpaid wages of workers, not having statutory first charge and not yet quantified, cannot take precedence over registered security interest of the bank – Bank permitted to sell secured assets; only surplus (after EPF and bank dues) can be made available for workmen’s claims [Paras 28-29].

Statutory Interpretation – Harmonisation of Welfare and Recovery Laws – Though both SARFAESI and EPF Acts contain non-obstante clauses, when one creates a statutory first charge (EPF), it prevails over mere statutory priority (SARFAESI) – SARFAESI being later statute does not override first charge unless expressly stated [Paras 25-27].

Decision:

Priority of Dues – Resolved – Appeals allowed in part – Directions in impugned Bombay High Court judgment modified – Held: Appellant-bank entitled to proceed with auction of secured assets – Sale proceeds must first satisfy statutory dues under EPF&MP Act (including contributions, interest, damages), and only thereafter applied to recover bank’s secured debt [Paras 28-30].

Workmen’s Claims – Not Extinguished – Workers allowed liberty to approach appropriate authority under MRTU & PULP Act to quantify dues – Such quantified dues can be considered only if surplus remains after satisfying EPF and bank claims – Delay in filing such claims not to operate as bar [Paras 29-30].