Specific Performance – Agreement to Sell – Readiness and Willingness – Extension of Time – Cash Payment to Agent – Plaintiff entered into an agreement dated 18.07.1988 for purchase of agricultural land for Rs. 15,41,000/- – Time was essence of contract; execution extended twice, last extension till 30.06.1989 – Plaintiff alleged attendance at Sub-Registrar's office on 30.06.1989 with balance consideration but defendants failed to appear – Trial court dismissed suit for specific performance finding plaintiff failed to prove continuous readiness and willingness – First Appellate Court reversed and decreed specific performance finding extension of time, cash payment of Rs. 5,00,000/- and readiness proved – High Court upheld in second appeal – Held: Findings of First Appellate Court not perverse; decree of specific performance maintained [Paras 2–10, 30, 40].

Second Appeal – Scope – Findings of Fact – Substantial Question of Law – Settled law that findings of fact, howsoever erroneous, cannot be reopened in second appeal under Section 100, CPC in the absence of a substantial question of law – High Court having found no substantial question of law had no occasion to reappreciate evidence – Argument that High Court ought to have examined evidence to ensure correctness of First Appellate Court's findings rejected [Paras 31–35].

Evidence – Non-Appearance of Plaintiff in Witness Box – Adverse Inference – Rebuttal – Plaintiff did not enter the witness box though alive during trial court proceedings – Held: Adverse presumption arising from non-appearance is a rebuttable presumption – Where Manager (PW-4), having personal knowledge of all transactions since 1988, appeared and corroborated plaint allegations including execution of agreement, payment of consideration and extension of time, adverse inference stood rebutted – Non-appearance of plaintiff not fatal to suit [Paras 41–43].

Specific Performance – Equitable and Discretionary Relief – Passage of Time – Escalation of Price – Defendants contended that decree passed after 15 years from the date of agreement was inequitable due to escalation in land prices – Held: No evidence whatsoever was brought on record to establish escalation of prices making it inequitable to grant decree – Discretion to refuse specific performance cannot be exercised in vacuum without proof of inequity [Para 44].

Lis Pendens – Section 52, TP Act – Transfers During Pendency of Litigation – Defendants transferred 60% of suit land on 12.02.2009 during pendency of litigation and remaining 40% on 27.02.2025 during pendency of this appeal – Defendants tendered unconditional apology for non-disclosure – Held: Transfers pendente lite are neither illegal nor void ab initio but remain subservient to rights of parties as ultimately determined – Sale deeds executed by defendants held non est – Plaintiff having obtained sale deed on 08.01.2010 pursuant to decree through due process, substantive rights accrued in favour of plaintiff's heirs; inequitable to dislodge them in exercise of discretionary jurisdiction [Paras 13, 17, 45–46].

Decision: Appeal dismissed – Sale deeds executed by defendants on 12.02.2009 and 27.02.2025 held non est – Decree of First Appellate Court maintained.

IBC - Insolvency Law – CIRP – Eligibility of Resolution Applicant – Multi-State Co-operative Society – "Same Line of Business" – Section 64(d) MSCS Act, 2002 – Appellant, a credit co-operative society with an agro-processing vertical, submitted a resolution plan of Rs. 169 Cr. for acquisition of Morarji Textiles Ltd. (corporate debtor engaged in man-made fibre/viscose manufacturing) – RP declared appellant ineligible under Section 30(2)(e) IBC as its bye-laws did not permit investment in corporate debtor – NCLT and NCLAT affirmed ineligibility – Held: Expression "any other institution in the same line of business" under Section 64(d) requires substantial or predominant sameness in core business activities determined with reference to the bye-laws of the MSCS; appellant's predominant business is financial intermediation and member-welfare; corporate debtor's business of synthetic/man-made fibre manufacturing is distinct from appellant's agro-based processing activity; appellant not in the same line of business as corporate debtor – Appeal dismissed as withdrawn [Paras 30–51].

Statutory Interpretation – "Same Line of Business" – Section 64(d) MSCS Act, 2002 – Meaning and Scope – The expression is not defined in the 2002 Act – JPC Report dated 15.03.2023 reveals that the phrase was inserted to address misuse of the earlier open-ended provision permitting investment in "any other institution", which had enabled dubious and fraudulent investments – The amendment was intended to restrict investments to institutions whose core activities bear a substantial, predominant or closely related sameness to those of the MSCS as reflected in its bye-laws – Revenue, profit or loss figures are irrelevant for this determination; the inquiry must be confined to the objects and functions in the bye-laws of the MSCS – Reference to SEBI Delisting Regulations and NIC Codes may provide illustrative guidance but is not determinative [Paras 32–37, 46].

Bye-laws as Decisive Charter – Line of Business Determined by Object Clause – The line of business of an MSCS must be determined from a cumulative reading of the objects and functions in its bye-laws – Appellant's Clauses 5(a) to 5(r) establish that its primary business is financial intermediation and member welfare; Clause 5(s) permits agro-product processing only; Clause 5(t) restricts partnerships to other co-operative societies only – These clauses do not contemplate standalone industrial manufacturing – A mere amendment to the investment clause (Clause 52) reproducing the language of Section 64(d) cannot expand the line of business in the absence of a corresponding amendment to the object clause [Paras 38–49].

Amendment to Bye-laws – Non-Production Before Tribunals – Consequence – Certificate of registration of amendment to bye-laws dated 24.01.2024 was available with appellant but was not placed before NCLT or NCLAT despite due opportunity – Appellant cannot be permitted to rely on the same at the appellate stage – Application for production of additional documents does not satisfy requirements of Order XLI Rule 27 CPC – Even if taken on record, amendment to Clause 52 would not advance appellant's case as it does not alter the object clause [Paras 47–49].

Judgment Rendered on Issue of Law Despite Withdrawal – Court exercised its discretion to explain the position of law on the pivotal issue under Section 64(d) MSCS Act, 2002, notwithstanding the appellant's request for withdrawal, having regard to the importance of the question involved – No findings returned on the merits of the appeal [Paras 1–2].

Decision: Application for withdrawal allowed – Appeal dismissed as withdrawn – CIRP of corporate debtor to continue in accordance with IBC – Pending applications disposed of.

Arbitration – Appointment of Arbitrator – Section 11 – Existence of Arbitration Agreement – Letter of Intent – No Concluded Contract – Appellant issued LOI dated 16.11.2022 accepting Respondent's bid for civil works worth ₹17.76 crores, but never issued a Work Order or handed over sites – Respondent terminated contract and invoked arbitration under Clause 23 of the Special Conditions of Contract – High Court appointed sole arbitrator ex parte – Held: LOI was a precursor to a contract and not the contract itself; it did not create a binding legal relationship; no concluded arbitration agreement existed between the parties even on a prima facie view; appointment of arbitrator set aside – Appeal allowed [Paras 19–43].

Letter of Intent – Legal Character – Promise to Make a Promise – A letter of intent is an expression of one party's intention to enter into a contract in the future and does not, in and of itself, create a binding legal relationship until there is clear, unambiguous and final acceptance – LOI in the present case expressly contemplated a future Work Order and formal agreement; sites were never handed over; mere submission of bank guarantees as a preliminary precursor cannot be said to be sufficient to form a concluded contract unless the tender framework so provides – Conduct of parties must be read holistically with the tender documents and the LOI to determine whether a binding legal relationship was intended [Paras 31–36].

Arbitration Agreement – Incorporation by Reference – Section 7(5) – General Reference Insufficient – Arbitration clause contained in Clause 23 of Special Conditions of Contract in the Tender documents could not be treated as incorporated into the LOI by its general reference to the Tender documents – Section 7(5) requires that the reference in the contract to the document containing the arbitration clause must be such as to make the arbitration clause specifically part of the contract – LOI made no specific reference to the arbitration or dispute resolution clause; this is a case of "reference" and not "incorporation" [Paras 37–39].

Scope of Inquiry Under Section 11 – Prima Facie Existence of Arbitration Agreement – Courts must not ordinarily interfere at the referral stage and must follow the principle of "when in doubt, do refer" – However, in the rarest of rare cases where even on a prima facie view, without going into disputed facts, no arbitration agreement is found to exist, the Court can reject the application – Present case is such a fit case where no arbitration agreement prima facie exists [Paras 42].

High Court's Finding Erroneous – High Court's observation that Appellant had not disputed existence of arbitration agreement in its reply dated 04.11.2024 is prima facie erroneous and contrary to the record – Appellant had specifically stated in that reply that there was no concluded contract and the LOI could not bind either party [Para 29].

Decision: Appeal allowed – Impugned order of the High Court set aside – Respondent at liberty to pursue other remedies in accordance with law – All interim applications disposed of.

Service Law — Daily-Wage Labourers — Regularisation — Compliance with Tribunal Directions — Appellants engaged as daily-wage gang labourers at ISRO's Mahendragiri Unit between 1991 and 1997 for sporadic work such as loading, unloading, and shifting of materials — Tribunal by order dated 9th March, 2010, directed respondents to frame a scheme or ad-hoc rules by creating requisite number of posts for engaging such persons on a permanent basis within six months — Said directions attained finality upon dismissal of challenge by High Court and this Court — Respondents framed "Gang Labourers Scheme, 2012" providing only for temporary engagement without creation of posts — Held: The Scheme is inconsistent with the Tribunal's directions; the mandate was not merely to regulate engagement but to create sanctioned posts and engage such persons on a permanent footing — Scheme set aside to that extent — Respondents directed to regularise services of appellants with effect from 9th September, 2010 within four weeks [Paras 8–25, 29(I), 29(II)].

Service Law — Scope of Judicial Review in Subsequent Round — Limits — Once directions of the Tribunal attained finality upon affirmation by High Court and Supreme Court, scope of consideration in subsequent proceedings was confined to examining compliance with those directions — Held: High Court transgressed limits of its jurisdiction by re-entering the merits of whether appellants' services could be regularised and by applying Umadevi to reopen the issue; it was wholly impermissible to revisit the question of regularisation at that stage — Impugned judgment set aside [Paras 26–27].

Service Law — State as Model Employer — Article 14 — Obligation of Fairness — Court expressed serious disapproval of the respondents' conduct in framing a scheme that effectively diluted the substance of binding judicial directions, prolonging litigation for years — Held: Obligation of the State to act as a model employer flows directly from Article 14 of the Constitution; arbitrariness and indifference towards daily-wage workers who contributed to ISRO's critical missions, including at Mahendragiri — a prohibited area under the Official Secrets Act — strikes at the root of fairness and dignity in public employment — Benefit of judgment extended to all similarly situated persons engaged under the Scheme [Paras 28–29(III)].

Decision: Appeal allowed — Judgment of the Division Bench of High Court of Judicature at Madras dated 8th July, 2024 in W.P. No. 31674 of 2019 set aside — "Gang Labourers (Employment for Sporadic Types of Work) Scheme, 2012" set aside to the extent inconsistent with Tribunal's directions — Clause 2 of the Scheme set aside — Respondents directed to regularise services of appellants with permanent status with effect from 9th September, 2010 within four weeks — Benefit extended to all similarly situated persons.

Criminal Law – Limitation for Taking Cognizance – Section 468, Cr.PC – Relevant Date for Computing Limitation – Cross-FIRs – FIR No. 121 of 2011 registered against Respondent No. 2 for offences under Sections 323 and 341 read with Section 34, IPC arising out of an altercation on 09.05.2011 – Charge-sheet filed on 29.05.2012, i.e., one year and twenty days after the incident – High Court quashed the FIR holding the bar of limitation under Section 468, Cr.PC attracted, treating the date of taking cognizance as the relevant date – Held: High Court committed a patent error; the relevant date for computing the period of limitation under Section 468, Cr.PC is the date of filing of the complaint or the date of initiation of criminal proceedings, and not the date on which the Magistrate takes cognizance – FIR/complaint lodged before the police constitutes initiation of criminal proceedings and is the starting point of limitation [Paras 2, 5.2.4, 7.2–7.4, 10].

Limitation – Section 468, Cr.PC – Date of Filing of Complaint vs. Date of Taking Cognizance – Law Settled by Constitution Bench – The issue whether limitation is to be reckoned from the date of filing of the complaint or the date of taking cognizance was no longer res integra in view of the Constitution Bench judgment in Sarah Mathew v. Institute of Cardio Vascular Diseases – Constitution Bench held that the date of taking cognizance is entirely an act of the Magistrate, liable to be delayed due to systemic or personal reasons, and cannot supply certain or definitive criteria for reckoning limitation – A diligent complainant who files the complaint within time cannot be prejudiced by the court's delay in taking cognizance – Section 473, Cr.PC postulates condonation of delay in filing the complaint, further indicating that the date of filing is the material date – Principle actus curiae neminem gravabit applied [Paras 5.3–5.8.4].

Precedent – Constitution Bench Judgment – Binding Effect – Respondent sought to distinguish Sarah Mathew (supra) on the ground that it involved a complaint filed before the Magistrate, whereas the present case involved an FIR followed by a police report under Section 173, Cr.PC – Held: Submission rejected – Whether proceedings are initiated by a complaint before the Magistrate or by an FIR before the police, in both cases the date of initiation of criminal proceedings is the relevant date – The binding effect of a Constitution Bench decision does not depend upon whether every particular argument was considered therein, so long as the point was actually decided – Stock contentions that a particular aspect was missed cannot dilute the law laid down by the Constitution Bench [Paras 7–9].

Professional Ethics – Duty of Advocates – Binding Precedent – Court observed that arguing against settled law merely to demonstrate argumentative skill, without exceptional grounds to distinguish the decision, wastes valuable court time – Giving up an argument where a point of law is already decided is a professional virtue and part of ethics in professional conduct – Lawyers, like courts, are expected to respect strong-operated precedents from binding judgments [Para 8–8.3].

Decision: Appeals allowed – Impugned order dated 30.01.2025 of the Delhi High Court in Crl. M.C. No. 1170 of 2017 and Crl. M.A. No. 7270 of 2016 set aside – Trial to expeditiously proceed in accordance with law.

Civil Law – Order 2 Rule 2, CPC – Bar on Subsequent Suit – Same Cause of Action – Parvatewwa instituted Suit-I in 2002 challenging adoption deed dated 23.03.1961 and seeking injunction simpliciter – Suit-I dismissed by Trial Court and confirmed in first appeal on limitation – During pendency of proceedings, Parvatewwa in 2007 instituted Suit-II seeking declaration of ownership and recovery of possession of the same property – Trial Court and First Appellate Court held Suit-II barred by Order II Rule 2, res judicata and constructive res judicata – High Court in second appeal reversed and decreed Suit-II – Held: High Court committed manifest error; Suit-II clearly barred by Order II Rule 2, CPC – Parvatewwa, fully aware that Channappa was asserting rights over the suit property on the basis of the adoption deed, ought to have claimed declaration of title and consequential relief of possession in Suit-I itself – Omission to do so without leave of court precludes institution of a subsequent suit for such omitted relief [Paras 20, 22–28, 41–42].

Order II Rule 2, CPC – Requirements for Bar – Identity of Cause of Action – Constitution Bench Principles – Defendant invoking bar under Order II Rule 2(3), CPC must establish: (i) second suit was in respect of same cause of action as earlier suit; (ii) plaintiff was entitled to more than one relief in respect of that cause of action; and (iii) plaintiff, without leave of court, omitted to sue for the relief claimed in the second suit – Cause of action has no relation to the defence set up by the defendant nor to the character of the relief prayed for – Test is whether the claim in the new suit is founded upon a cause of action distinct from the foundation of the former suit – Causes of action in both suits must be identical in substance and not merely technically identical [Paras 21, 26].

Constructive Res Judicata – Explanation IV to Section 11, CPC – A matter which might and ought to have been made a ground of attack or defence in the former proceedings shall be deemed to have been directly and substantially in issue therein – Parvatewwa, having omitted to seek declaration of title in Suit-I despite being aware of Channappa's claim, cannot be permitted to agitate the same issue in a subsequent suit – Adjudication is conclusive not only as to matters actually decided but also as to every other matter which the parties might and ought to have litigated as incidental to or essentially connected with the subject-matter of the litigation [Paras 29–33].

Civil Procedure – Section 105(1), CPC – Interlocutory Order – Finality – Non-Appealability – Order rejecting application under Order II Rule 2, CPC (I.A. No. 4) is not independently appealable under Section 104 read with Order XLIII, CPC – Under Section 105(1), CPC, any error, defect or irregularity in such interlocutory order affecting the decision of the case may be raised as a ground of objection in the appeal against the final decree – Such order does not amount to a final adjudication of rights and does not assume irrevocable finality so as to preclude the defendant from re-agitating the issue in appeal against the decree – To hold otherwise would defeat the very purpose of Section 105, CPC and confer upon a non-appealable interlocutory order a status which the legislature has consciously not accorded [Paras 9–14].

Second Appeal – Section 100, CPC – Scope of Interference – Concurrent Findings of Fact – High Court in second appeal is confined to cases involving a substantial question of law – Concurrent findings of fact recorded by courts below cannot be interfered with unless shown to be perverse or based on no evidence – High Court cannot conduct a "third trial on facts" – In the present case, High Court proceeded to reassess the entire factual matrix without recording any cogent reason to demonstrate that concurrent findings suffered from perversity or misapplication of settled legal principles – Such exercise exceeded the permissible limits of jurisdiction under Section 100, CPC [Paras 35–39].

Decision: Appeal allowed – Impugned judgment of the High Court set aside – Suit-II (O.S. No. 13 of 2007) dismissed – Parties to bear their own costs.

Execution of Decree – Compromise Decree – Jurisdiction of Executing Court – Modification of Decree – Parties entered into a compromise in a suit for specific performance resulting in a decree dated 14.07.2017 dividing 51R of land equally at 20.5R each with 10R as common land – Executing Court in Execution Petition No. 21 of 2018 passed order dated 19.07.2021 varying the areas allotted to the parties on the ground that constructions on the extreme western side were not as per sanctioned plan and that part of the area had been sold to a third party – Review petition allowed on 26.08.2021 modifying the decree further – High Court upheld the orders in writ petition – Held: Executing Court acted in excess of jurisdiction; orders set aside – Executing Court directed to execute the decree in its terms and tenor [Paras 14–16, 30–31].

Executing Court – Jurisdiction – Section 47, CPC – Settled Law – Executing Court is empowered only to decide questions relating to execution, discharge or satisfaction of the decree and has no jurisdiction to go beyond the decree – It must execute the decree as it stands without altering or substituting its own view in place of that expressed in the decree – The Executing Court cannot assume the role of a trial court – Exception only where decree is a nullity for lack of inherent jurisdiction, which was not the case herein [Paras 24–27].

Executing Court – Reciprocal Obligations – Identity of Land – Where compromise decree clearly and unequivocally describes the portions of land falling into the shares of each party, no dispute as to identity of land arises – Fact that exchange of certain portions may be impracticable due to constructions not conforming to sanctioned map or part of land having been sold is immaterial and does not empower the Executing Court to vary the decree – Reliance placed by respondent on Jai Narain Ram Lundia v. Kedar Nath Khetan rejected; said decision only permits the Executing Court to resolve disputes as to identity of the specific thing to be given under reciprocal obligations and does not authorise variation of decree terms [Paras 28–30].

Decision: Appeal allowed – Orders dated 19.07.2021 and 26.08.2021 passed by the Executing Court and consequential order dated 11.10.2021 set aside – Executing Court directed to execute the compromise decree in its terms and tenor.

Insolvency and Bankruptcy Code – Section 9 – Operational Creditor – Pre-existing Dispute – Respondent-operational creditor filed application under Section 9 of the Code claiming Rs. 2,92,93,223/- as dues for chemical supplies – Appellant-corporate debtor raised pre-existing dispute alleging defective supplies, counterclaim of Rs. 70,09,430/-, and need for account reconciliation – NCLT dismissed the application finding a plausible dispute requiring detailed investigation beyond its summary jurisdiction – NCLAT reversed, holding that a credit note of Rs. 1.66 crore resolved earlier disputes and that events post demand notice could not be considered – Held: NCLT was correct; NCLAT not justified in reversing the decision – Appeal allowed [Paras 1, 7, 21–22].

Pre-existing Dispute – Test of Plausibility – Reconciliation of Accounts – The test for existence of a pre-existing dispute under Section 9 of the Code is not whether the defence would succeed on merits but whether there is a plausible contention requiring further investigation that is not spurious, hypothetical or illusory – Respondent's first written correspondence acknowledging defective supplies dated back to 10.12.2020, long prior to demand notice dated 11.11.2021 – Appellant's police complaint dated 27.09.2021 and email dated 16.10.2021 calling for reconciliation of accounts, issued prior to demand notice, clearly indicated pre-existing disputes – Respondent's demand having fluctuated from Rs. 4.60 crore to Rs. 2.92 crore with belated clarification, confusion as to the amount due itself supported need for reconciliation [Paras 15, 17–18, 21].

IBC – Section 9 – Interest at 24% per annum – Unilaterally Signed Invoices – Debit notes raised by respondent for interest at 24% per annum on alleged delayed payments dating back to 2016–17 and 2018, raised only in August and September 2021 after its reply dated 14.07.2021, are themselves open to question – Such claims based on unilaterally signed invoices in defiance of limitation constitute further aspects of the pre-existing dispute [Paras 12, 16].

IBC – Section 9 Application – Scope of Inquiry – NCLAT erroneously delved into the merits of the dispute to decide whether the appellant's defence had actual merit – What is required is only to satisfy that a plausible pre-existing dispute exists; the adjudicating authority is not required to be satisfied that the defence is likely to succeed – NCLAT also erred in refusing to consider admissions of respondent's Director in the civil suit, as those admissions related to pre-CIRP issues relevant to the case and not to post-CIRP events [Paras 16, 19–21].

Decision: Appeal allowed – Judgment dated 11.02.2025 of the NCLAT in Company Appeal (AT) (Ins) No. 157 of 2023 set aside – Order dated 16.12.2022 of the NCLT in Company Petition (IB)-792(ND) of 2021 restored – Parties to bear their respective costs.

Civil Law – Title Suit – Burden of Proof – Pujari vs. Owner – Plaintiff Must Succeed on Own Title – Respondent-plaintiffs, a registered society and its members, claimed ownership of an ancient temple "Moorti Swarup Shri Govardhan Nath Ji" at Rampura Bazar, Kota, and sought removal of the appellant-defendant who asserted private ownership through a line of successive adoptions – Trial Court and High Court concurrently held that the appellant's predecessors were merely appointed pujaris and decreed the suit for possession – Held: Courts below misdirected themselves by shifting focus from plaintiff's proof of title to infirmities in defendant's case; respondent-plaintiffs failed to produce any deed of dedication, document of endowment, or legally admissible evidence of ownership – Suit must fail for want of proof of plaintiff's own title – Appeal allowed; suit dismissed [Paras 12–21].

Burden of Proof – Sections 101, 102 and 110, Indian Evidence Act, 1872 – In a suit for declaration of title and consequential relief, the burden lies squarely upon the plaintiff to establish clear and cogent title – Plaintiff cannot succeed on the weakness of the defendant's case – Reliance placed on Union of India v. Vasavi Co-op. Housing Society Ltd., (2014) 2 SCC 269 – Even assuming the defendant failed to conclusively establish his title through the claimed chain of adoptions, the same does not enure to the benefit of the plaintiffs – Held: Respondent-plaintiffs have not discharged this burden [Paras 12–13, 17–18].

Management vs. Ownership – Religious Institution – The documents of 1926 and 1951 relied upon by the courts below, evidencing appointment of pujaris by the respondent-society, are at best indicative of management arrangements and do not constitute documents of title – Mere supervisory or managerial functions over a temple, including participation in appointment of pujaris, do not ipso facto confer title upon the society – The distinction between management of a religious institution and ownership of its properties is well recognised in law and the two cannot be conflated [Paras 15–16].

Decision: Appeal allowed – Judgment of the High Court dated 28.09.2007 in S.B. Civil First Appeal No. 36 of 1988 set aside – Suit dismissed – Pending applications disposed of.