Labour Law – Gratuity – Service Compensation – Constitutionality – Sections 47(3) & 47(4) of the Andhra Pradesh Shops and Establishments Act, 1988 challenged as arbitrary and violative of Articles 14 & 19(1)(g) – Provisions allowed payment of service compensation (15 days’ wages per year of service) to employees with only one year’s service or less, including those who resigned or voluntarily ceased work after 60 years – Held: “Service compensation” under Section 47(3) is in substance gratuity – Reducing qualifying service to one year destroys the principle that gratuity is a reward for long and meritorious service – Such provision unreasonable and arbitrary [Paras 13–16].

Constitutional Law – Equality – Discrimination between similarly situated employees – Factory employees under the Factories Act eligible for gratuity only after 5 years’ continuous service, whereas clerical/administrative employees under the Shops Act could claim after one year – Held: Such differential treatment between employees similarly situated in nature of employment is discriminatory and violates Article 14 [Paras 14–15].

Legislative Competence – Repugnancy under Article 254(2) – State Act and Central Payment of Gratuity Act occupy the same field – Mere Presidential assent to the State Act not sufficient to save it when conflict with Central law not brought to the President’s notice – Article 254(2) cannot validate provisions directly inconsistent with the Central Act [Paras 22–23].

Labour Welfare – Reasonableness of Restriction – Section 47(4), providing for payment of wages from termination till actual payment of service compensation, per se unreasonable and capable of abuse – Cosmetic change from earlier unconstitutional Section 40(3) of 1966 Act does not cure defect – Provision invalid [Paras 17, 23].

Interpretation of Labour Statutes – Concept of Gratuity – Gratuity is a statutory reward for long and continuous service – Court must “lift the veil” to determine true nature of legislation – Misnaming “gratuity” as “service compensation” cannot disguise its substance [Paras 13–16, citing Peerless General Finance].

Doctrine of Occupied Field – Both the Payment of Gratuity Act, 1972 and Andhra Pradesh Shops and Establishments Act, 1988 operate in same field – Hence State provisions struck down as repugnant [Para 23].

Held: Sections 47(3) and 47(4) of the Andhra Pradesh Shops and Establishments Act, 1988 declared unconstitutional, discriminatory, and violative of Articles 14 and 19(1)(g) – Appeal dismissed – High Court judgment affirmed [Para 24].

Decision: Appeal dismissed – No order as to costs.

Arbitration – Appointment of Arbitrator – Deviation from Contractual Clause – Clause 64 of the railway contract provided for a three-member Arbitral Tribunal consisting of serving Gazetted Railway officers – Respondent sought arbitration in 1999 but arbitration proceedings were repeatedly stalled due to resignations and non-cooperation from Railways – High Court appointed retired Judge of Delhi High Court as sole Arbitrator – Held: In light of delays and non-functioning of contractual tribunal, appointment of independent sole Arbitrator justified – No interference warranted under Article 136 [Paras 3–9, 13].

Section 11 – Judicial Power to Appoint Arbitrators – Court held that while contractual procedure should generally be followed, Chief Justice or designate under Section 11 has discretion to appoint alternative arbitrator when party-nominated tribunal fails due to delay or lack of independence and impartiality – Appointment of retired Judge valid where contractual mechanism became unworkable [Paras 7–9].

Public Contracts – Use of Serving Officers as Arbitrators – Court noted that appointment of serving officers as arbitrators creates resistance due to concerns of bias – Recommended that government and PSUs phase out such clauses to promote impartiality and professionalism in arbitration – Emphasis placed on independence and neutrality in modern arbitration practice [Para 11].

Arbitration Costs – Escalation in Fees – Court expressed concern over high cost of arbitration when retired Judges are appointed – Noted that arbitrator’s fees often become excessive, especially when fixed unilaterally – Highlighted need for institutional arbitration or fee regulation – Suggested courts fix arbitrator fees during appointment or that retired Judges declare fee structures in advance – Urged self-regulation to ensure affordability and credibility of arbitration process [Para 10].

Institutional Arbitration – Fee Regulation – Court endorsed institutional arbitration as a method to address cost concerns – Institutions offer transparent and uniform fee structures and administrative control – Suggested courts and arbitrators adopt best practices to prevent cost inflation and preserve arbitration's efficacy [Para 10].

Decision: Appeal dismissed – Appointment of retired Judge as sole Arbitrator upheld – Court found no violation in bypassing Clause 64 due to inordinate delays and repeated failures by Railways to constitute arbitral tribunal – High Court’s fee direction (Rs. 10,000 per sitting, max Rs. 1,50,000 plus clerkage, shared equally) accepted.

Criminal Law – Common Object – Murder – Section 149 IPC – Appellants convicted for double murder arising out of long-standing family enmity – Deceased persons were attacked in two successive incidents by a group armed with deadly weapons – Trial court and High Court found all accused shared common object and participated in the crime – Held: Even in absence of specific overt acts by some accused, their presence with weapons and conduct indicated common object to commit murder – Conviction under Sections 302/149 IPC upheld [Paras 4–7, 21–23, 35–36]

Evidence Act – Eyewitness Testimony – Credibility – Eye-witnesses were relatives of deceased – Presence corroborated by medical evidence and FIR – Injured eyewitness (PW-5) found to have genuine injury – Evidence found trustworthy and consistent – Held: Merely being related to the deceased does not disqualify a witness – Their testimonies cannot be discarded in absence of cogent reasons [Paras 21–22, 24–26]

Criminal Procedure – Medical Evidence vs Ocular Evidence – Presence of semi-digested food in stomach of deceased alleged to contradict time of death – Held: Digestive process depends on many factors – Medical evidence not conclusive to reject consistent and credible ocular evidence [Paras 27–28]

Criminal Procedure – Delay in Examination of Witnesses – Delay in recording statements explained by Investigating Officer – No question put in cross-examination regarding delay for some witnesses – Held: Delay in itself not fatal unless linked with false implication or unfair investigation [Paras 30–32]

Criminal Procedure – Inquest Report – Non-Mention of Accused’s Name – Not Fatal – Purpose of inquest under Section 174 CrPC is to ascertain apparent cause of death – Not meant to record detailed circumstances or fix liability [Paras 33]

Criminal Law – Compounding of Offences – Section 320 CrPC – Application for compounding double murder rejected – Alleged settlement between families post-incident not sufficient to override mandatory legal bar on compounding offences under Section 302 IPC – Held: Murder is a crime against society and cannot be settled privately – Interlocutory applications for compromise and impleadment dismissed [Paras 16–18, 37–38]

Criminal Appeal – No Interference Warranted – Findings of fact by trial court and High Court based on consistent and credible evidence – Plea of alibi disbelieved – Appeal dismissed [Paras 39]

Decision: Appeal dismissed – Conviction and sentences confirmed – Interlocutory applications for impleadment and acceptance of compromise also dismissed as not maintainable.

Criminal Law – Murder – Exception 4 to Section 300 IPC – Applicability – Appellant convicted for murdering deceased Kaluram by inflicting a knife blow on his chest – defence plea that incident occurred in a sudden fight without premeditation and hence case fell under Exception 4 to Section 300 IPC – Held: Exception 4 applies only when death is caused (a) without premeditation, (b) in a sudden fight, (c) without offender taking undue advantage or acting in a cruel or unusual manner, and (d) the fight being mutual – Mere verbal altercation or resistance to illegal search not sufficient – No evidence of mutual provocation or sudden fight – Offender armed and took undue advantage – Exception 4 not attracted [Paras 6–8].

Evidence – Nature of Incident – Prompt FIR – Weapon Recovery – Occurrence took place at 10:15 p.m. – FIR lodged promptly at 2:30 a.m. – Recovery of knife at appellant’s instance, found stained with human blood – corroborated prosecution version – Conviction sustainable [Paras 3, 5, 8].

Murder – Intention and Knowledge – Fatal Injury – Single stab wound penetrated pericardium and lung causing death – fatal blow on vital part of body shows clear intention to cause death or injury sufficient in the ordinary course to cause death – Conviction under Section 302 IPC justified [Paras 7–8].

Doctrine – Sudden Fight and Provocation – Distinction between Exception 1 and Exception 4 clarified – While Exception 1 relates to total loss of self-control due to provocation, Exception 4 applies where both parties share blame in a sudden fight without premeditation – In absence of reciprocal aggression or heat of passion, benefit of Exception 4 cannot be extended [Paras 6–7].

Decision: Appeal dismissed – Conviction under Section 302 IPC and sentence of life imprisonment affirmed.

Criminal Law – Prevention of Corruption – Demand and Acceptance of Bribe – Appellant, a Central Excise Inspector, convicted for accepting ₹1500 alleged as bribe for clearing export goods – Trial Court found him guilty under Sections 7 and 13(1)(d) read with 13(2) of the Prevention of Corruption Act – High Court acquitted him under Section 13(1)(d) and 13(2), but upheld conviction under Section 7 – Supreme Court held that prosecution witnesses PW-10 and PW-2 gave inconsistent and contradictory statements – PW-10, the alleged bribe-giver, denied any demand and was declared hostile – PW-11, an official witness, did not corroborate the prosecution version – Post-trap mahazar (Exh. P-9) did not mention any demand – Held: Prosecution failed to prove the essential element of demand – Conviction unsustainable [Paras 8–14, 21–22]

Presumption under Section 20 – Rebuttal – Though tainted money was recovered from the appellant, the statutory presumption under Section 20 of the Prevention of Corruption Act was rebutted by the explanation that the amount was repaid as a loan on behalf of PW-2 to Accused No. 1 – Supreme Court reiterated that presumption is rebuttable and not conclusive – It can be displaced by preponderance of probabilities – Mere recovery of tainted money, in the absence of evidence proving demand and corrupt intent, is insufficient to sustain conviction [Paras 15–20]

Acquittal – Evidence did not establish guilt beyond reasonable doubt – Appellant proved his defence by preponderance of probability – Conviction and sentence set aside – Appeal allowed – Bail bonds discharged [Paras 23–25]

Criminal Law – Appeal against Acquittal – Interference by Appellate Court – Principles Restated – Trial court acquitted the appellant on finding that prosecution failed to prove identity, recovery, and weapon connection – High Court reversed acquittal after 24 years and convicted under Sections 304 Part-II, 307, 324 IPC and Section 25 Arms Act – Held, unless the findings of trial court are perverse, unreasonable, or unsustainable, the High Court should not interfere with an acquittal – If two views are possible, one favouring acquittal must prevail – Rule of prudence requires restraint by appellate court [Paras 12.1–12.2, 27].

Evidence – Medical and Ballistic Evidence – Contradiction with Ocular Testimony – Benefit of Doubt – Prosecution alleged that a single bullet fired from .315 bore rifle caused injuries to four persons – Medical evidence showed each injured had distinct entry and exit wounds inconsistent with single shot theory – Ballistic Expert opined that the rifle examined (.302 bore) did not match the alleged weapon – Serious discrepancy between weapon examined and weapon allegedly used – Held, contradictions between ocular, medical, and expert evidence fatal to prosecution – Benefit of doubt to accused [Paras 18, 22–23, 27].

Criminal Procedure – Section 378 CrPC – Appellate Power in Acquittal Appeals – High Court failed to consider that trial court’s reasoning was plausible and based on material evidence – Findings of trial court not perverse – Held, High Court erred in reappreciating evidence to substitute its own view merely because another view was possible [Paras 21, 27].

Arms Act, 1959 – Sections 25 and 27 – Wrong Conviction under Section 25 – Appellant tried under Section 27 for using his father’s licensed rifle – High Court convicted under Section 25 which deals with manufacture, possession, or sale of arms without license – Held, conviction under Section 25 unsustainable as charge and evidence related only to Section 27 – Conviction set aside [Para 26].

Doctrine of Prudence – Rule of Two Possible Views – Where two views possible on evidence, one leading to acquittal and other to conviction, the one favourable to the accused must be adopted – High Court’s interference unjustified when trial court’s reasoning was reasonable and supported by record [Paras 12.1–12.2, 27].

Held: High Court’s reversal of acquittal was improper – Prosecution failed to establish guilt beyond reasonable doubt – Serious inconsistencies between medical, ballistic, and ocular evidence – Trial court’s acquittal based on plausible reasoning restored – Conviction and sentence set aside – Appellant acquitted and ordered to be released forthwith unless wanted in any other case [Paras 29–30].

Decision: Appeal allowed – High Court judgment dated 29.07.2005 set aside – Order of acquittal dated 09.10.1980 by Sessions Judge, Jhansi, restored – Appellant acquitted.

Technical Education – Bridge Course – AICTE Policy – Institute affiliated to State Board converted its four-year Post Diploma course (with 10+1 entry) into a four-year Advance Diploma course (with 10+2 entry) – Later upgraded to five-year B.Tech degree – Institute sought permission for one-year bridge course for diploma holders to obtain B.Tech – AICTE rejected request citing policy concerns and lack of enabling provisions – High Court directed approval of bridge course first for 10+2 diploma holders, later extended to 10+1 holders – Held: Grant of bridge course approval involves academic and technical policy decisions, within exclusive domain of AICTE – Courts cannot override academic standards or dilute entry qualifications through judicial directions [Paras 1–11, 12–17].

Judicial Review – Educational Policy – Role of Courts – Courts should not interfere in academic matters or substitute expert opinion of statutory educational bodies – Power of judicial review limited to examining legality, not wisdom, of policy decisions – High Court erred in granting relief by directing academic bodies to create or continue unauthorized academic programmes – Held: Entry-level qualification of 10+2 (PCM) for B.Tech must be strictly enforced – Courts cannot create equivalence through judicial fiat [Paras 13–15, 17–18].

Doctrine of Precedent and Estoppel – AICTE had earlier accepted Delhi High Court’s directions for one-time bridge course for 10+2 diploma holders – Later decisions extending benefit to 10+1 holders challenged – Held: Absence of appeal against earlier orders does not estop AICTE from resisting subsequent erosion of academic standards – No estoppel against statutory function to uphold quality of education [Para 16].

Decision: Appeals allowed – High Court orders permitting 10+1 Post Diploma holders to take bridge course set aside – Writ petitions dismissed – Clarified: Those who already completed bridge course and obtained degrees pursuant to High Court orders not affected by this judgment [Paras 18–19].

Criminal Law – NDPS Offence – Conscious Possession – Meaning and Scope – Conviction under Section 15 NDPS Act requires proof of conscious possession – Possession implies control with awareness of its nature – Once possession established, burden shifts to accused under Sections 35 and 54 NDPS Act to explain innocence – However, failure to question accused on possession under Section 313 CrPC vitiates conviction – High Court rightly acquitted respondents [Paras 10–18, 43–45].

Criminal Procedure – Examination of Accused – Section 313 CrPC – Mandatory Nature – Purpose is to afford opportunity to explain circumstances against accused – Not a mere formality – Failure to put vital question on possession amounts to violation of fair trial principles – Answers under Section 313 serve as substitute for testimony and must be personal unless exemption justifiably granted [Paras 18–21, 23–33].

Interpretation of Section 313 CrPC – Personal Examination and Exemption – Though general rule mandates personal questioning, in exceptional circumstances (hardship, incapacity, expense), the court may allow written responses verified by affidavit – Course permitted in Basavaraj R. Patil v. State of Karnataka – Such pragmatic approach ensures substantial compliance without prejudice to accused [Paras 37–40].

Evidence – Use of Circumstances Not Put to Accused – Circumstances not confronted under Section 313 cannot be used for conviction – As held in Avtar Singh v. State of Punjab – Omission to question on possession fatally affects prosecution case [Para 44].

Decision: Appeal dismissed – High Court’s acquittal upheld – Directions for departmental action against officials expunged [Para 45].

Service Law – Promotion – Reservation vs. Concession – Regional Rural Banks governed by NABARD Circulars – Circular dated 10.06.1997 providing concession to SC/ST candidates within the “zone of consideration” – Held: The circular did not create reservation of posts but only a concession allowing automatic promotion if the SC/ST candidate was within the number of vacancies and found not unfit – A candidate outside the vacancy range had to compete in selection process – High Court erred in treating the concession as reservation [Paras 16–17].

Administrative Law – Jurisdiction of State Reservation Policy – Regional Rural Banks governed by Central Act and NABARD circulars – State reservation policy inapplicable – Division Bench’s direction to promote respondent contrary to governing policy and circulars – Set aside [Paras 12, 16–18].

Service Law – Selection Process – Participation and Estoppel – Candidate having participated in the interview and failed cannot challenge selection process thereafter – Reliance placed on G.N. Nayak v. Goa University – Respondent not entitled to relief after unsuccessful attempt [Para 12].

Interpretation of Circulars – Expression “Reservation Posts” in NABARD Circular – To be construed as ‘concession’ not ‘quota’ – Concession operates only for SC/ST officers senior enough to fall within the number of vacancies – No independent right to appointment merely by belonging to SC/ST category [Paras 16–17].

Decision: Appeal allowed – Orders of Single Judge and Division Bench of Gauhati High Court set aside – No costs [Paras 18–19].