Judicial Service Law - Strictures Against Judicial Officer – Principles of Natural Justice – Unwarranted Strictures Expunged – Appeal Allowed – The appellant, a Judicial Officer in Rajasthan, challenged the adverse remarks made by the High Court against him while granting bail to an accused without considering criminal antecedents – The Supreme Court held that the High Court erred in passing personal strictures without giving the Judicial Officer an opportunity to explain – The Court reiterated that any perceived misconduct should be addressed on the administrative side by the Chief Justice and not through judicial orders – The Supreme Court found that the strictures were based on an overruled judgment and therefore unsustainable – Held: Adverse observations were uncalled for, contrary to principles of natural justice, and stood expunged – Appeal allowed and directions issued to all High Courts to consider rules mandating disclosure of criminal antecedents in bail applications [Paras 1-26].

Judicial Restraint – Adverse Remarks in Judicial Orders – Conduct of Judges – High Courts must avoid making personal criticism against subordinate Judicial Officers in judicial orders and must adopt the administrative route to address concerns – Such approach safeguards the dignity of judges, prevents demoralisation, and ensures adherence to constitutional protections for judicial officers – Held: Personal remarks against the appellant were contrary to established norms and set aside [Paras 15-19].

Reliance on Reversed Judgments – Effect on Judicial Findings – The Supreme Court held that the High Court’s reliance on the judgment in Jugal v. State of Rajasthan, which was reversed in Ayub Khan v. State of Rajasthan, rendered the basis of the strictures erroneous – Held: Orders founded on reversed precedents are unsustainable – Strictures expunged [Para 20].

Policy Direction – Criminal Antecedent Disclosure in Bail Matters – Directions for Systemic Reform – The Court directed Registrar Generals of all High Courts to consider incorporating a rule mandating disclosure of involvement in other criminal cases while applying for bail, similar to Rule 5 of Punjab and Haryana High Court Rules, to ensure full transparency in bail proceedings [Paras 22-24].

Final Decision – Appeal Allowed – Strictures Expunged – The Supreme Court allowed the appeal, expunged the strictures passed against the appellant, and directed circulation of this order for administrative action and possible procedural reforms in bail applications across all High Courts [Paras 25-26].

Criminal Law - Quashing of FIR – Abuse of Criminal Process – Civil Dispute Given Criminal Colour – FIR Quashed – The appellants challenged the High Court’s order dismissing their petition under Section 482 CrPC seeking quashing of FIR No. 771/2020 involving alleged cheating and criminal breach of trust in a land sale transaction – The Supreme Court held that the FIR was registered on false and exaggerated allegations over a failed property transaction where civil remedies had already been invoked – Held: The dispute was purely civil, and the criminal proceedings were instituted to harass the appellants; FIR and all consequential proceedings quashed [Paras 3-14, 18].

High Court’s Perfunctory Order – Failure to Consider Merits – Remedied by Supreme Court – The High Court had dismissed the quashing petition without examining the merits – Held: The High Court acted mechanically and failed to exercise jurisdiction judiciously – The Supreme Court exercised powers under Article 136 to avoid remand and deliver substantial justice [Paras 4-5, 16-17].

Inconsistent Pleadings – Contradictions Between FIR and Civil Suit – Allegations Fabricated – The complainant alleged oral agreement for Rs. 5 crore in the FIR and Rs. 5.75 crore in the civil suit, along with contradictory claims about other properties – Held: Such contradictory pleadings reinforced the conclusion of malicious prosecution without criminal intent on part of the appellants [Paras 11-12].

Protection of Vulnerable Litigants – Safeguards Against Harassment – Direction for Police Protection – Considering harassment faced by the 70-year-old widow and her daughter, the Court directed Telangana Police to provide security to appellants when visiting Hyderabad in relation to property management [Para 20].

Exemplary Costs Imposed – Misuse of Legal System – Complainant Penalised – Held: Complainant abused criminal process to exert pressure and extort settlement in a civil dispute – Exemplary cost of Rs. 10,00,000/- imposed on complainant, payable to appellants [Paras 21-22].

Decision – Appeal Allowed – Criminal Proceedings Quashed – Costs Imposed – The Supreme Court allowed the appeal, quashed the FIR and criminal case, awarded costs of Rs. 10,00,000/- to appellants, and directed police protection during visits to Telangana [Paras 23-24].

Civil Law - Abatement of Appeal – Non-Substitution of Legal Representatives – Total Abatement of Second Appeal – Appeal Dismissed – The appellants challenged the orders of the High Court that dismissed their applications seeking condonation of delay and substitution of legal representatives of deceased co-appellant Ram Babu – The Supreme Court found that no sufficient cause was shown for the inordinate delay, especially since surviving appellants were close family members and aware of Ram Babu’s death – Held: The High Court was justified in dismissing the applications, and the Supreme Court found no reason to interfere with the finding of abatement [Paras 1-10, 38(a)].

Joint and Indivisible Decree – Whole Appeal Abated – The Court reiterated that where the decree under challenge is joint and indivisible, the failure to substitute legal representatives of one deceased co-appellant leads to total abatement of the appeal to prevent the risk of inconsistent decrees – Held: Since both defendants jointly claimed ownership of the suit property, the decree was indivisible and hence the entire second appeal stood abated [Paras 11-17, 33-37, 38(b)].

Order XLI Rule 4 CPC – Not Applicable to Joint Appeals – Appeal Could Not Continue – The Court clarified that Order XLI Rule 4 CPC applies when one of multiple parties appeals a decree based on common grounds, but it does not apply where the appeal is jointly filed and abates due to non-substitution – Held: After the death of co-appellant Ram Babu, the surviving appellants could not continue the appeal, and the appeal was rightly held to have abated [Paras 26-31, 38(c)].

Conflict of Decrees – Prevention of Inconsistent Decisions – Complete Abatement Necessary – The Supreme Court emphasized the fundamental principle against conflicting decrees in the same matter – Held: Allowing the appeal to proceed would result in conflicting outcomes, as the decree had already become final against Ram Babu, making continuation impermissible [Paras 33-37].

Decision – Appeal Dismissed – Total Abatement Affirmed – The Supreme Court dismissed the appeals, upheld the High Court’s decision, and held that the appeal had abated in entirety due to non-substitution, disallowing any relief under Order XLI Rule 4 CPC – No costs awarded [Paras 38-39].

Arbitration Law – Existence of Arbitration Agreement – Clause with Directory Language – Appeal Dismissed – The appellant invoked Section 11 of the Arbitration and Conciliation Act, 1996 seeking appointment of arbitrator based on Clause 13 of the contract, which used the expression “may be sought through arbitration” – The Supreme Court held that mere inclusion of an enabling provision does not amount to a binding arbitration agreement – The Court found no consensus ad idem to refer disputes to arbitration, affirming the High Court's rejection of appointment of arbitrator – Held: Absence of binding arbitration clause precludes reference to arbitration under Section 11 [Paras 1-34].

Judicial Examination – Referral Court’s Role Under Section 11 – Prima Facie Satisfaction Required – Court Clarified – The Court reiterated principles laid down by the seven-Judge Bench in Interplay Between Arbitration Agreements, (2024) 6 SCC 1, holding that under Section 11, the Court must conduct a prima facie examination of the existence of arbitration agreement but cannot compel arbitration in absence of such agreement – Held: Referral Court’s limited examination is essential to prevent frivolous arbitration claims [Paras 14-19].

Interpretation of Contractual Clause – Directory vs Mandatory Language – Non-Existence of Binding Clause – The Supreme Court held that use of directory language like “may be sought” indicates lack of obligation to arbitrate and absence of present commitment to resolve disputes by arbitration – Held: Clause 13 lacked necessary elements of arbitration agreement under Section 7, particularly the binding nature of dispute resolution method [Paras 20-32].

Non-Applicability of Doctrine of Competence-Competence – No Need to Refer Matter to Arbitral Tribunal – The Court rejected the contention that the issue should have been left to the arbitral tribunal under the doctrine of competence-competence – Held: Where prima facie no arbitration agreement exists, the matter should not be referred to arbitration at all [Paras 16-19].

Decision – Appeal Dismissed – No Arbitration Agreement Found – The Supreme Court dismissed the appeal, upheld the High Court’s order refusing to appoint arbitrator, clarified the distinction between enabling dispute resolution clauses and binding arbitration agreements, and directed no costs [Paras 34-36].

Criminal Law - Bribery and Conspiracy Allegation – Demand and Acceptance of Illegal Gratification – Sections 7, 13(1)(d), 13(2), Prevention of Corruption Act – Appeal Allowed – The appellant, an Assistant Administrative Officer, was accused of demanding bribe along with a superior officer for claim settlement in an insurance matter – Initially acquitted by the Trial Court, conviction was later reversed by the High Court based on inference from phone calls and trap proceedings – The Supreme Court found serious contradictions in the prosecution’s version, including absence of direct demand proof, inconsistencies in trap procedure, and flawed reliance on circumstantial evidence – Held: Conviction set aside, Trial Court’s acquittal restored due to lack of credible proof of demand and acceptance beyond reasonable doubt – Acquittal. [Paras 1, 24-39].

Reversal of Acquittal – Standard of Appellate Interference – Double Presumption of Innocence – The Court reaffirmed the legal principle that in appeals against acquittal, the High Court must proceed cautiously and interfere only when Trial Court’s findings are perverse or unreasonable – Held: Trial Court’s view based on evidence inconsistencies was reasonable; High Court erred in reversing acquittal without addressing material gaps – Supreme Court reinstated the presumption of innocence of the appellant [Paras 24, 34-36].

Evidentiary Gaps and Investigative Lapses – Contradictory Evidence Regarding Trap Proceedings – The Court highlighted three critical inconsistencies: unexplained participation of the SP in trap proceedings, inconsistency in seized articles (white shirt appearing moss-coloured), and contradiction in chemical test results on a whisky box without prior application of phenolphthalein – Held: Prosecution failed to maintain evidentiary integrity, rendering conviction unsustainable [Paras 30-33].

Demand and Acceptance Not Established – Application of Neeraj Dutta Doctrine – The Court applied the principle laid down in Neeraj Dutta v. State (2023) on the requirement of clear proof of demand and acceptance in bribery cases – Held: Demand not proved by credible direct or circumstantial evidence, benefit of doubt must flow to the accused [Paras 24-28, 38].

Final Decision – Appeal Allowed – Supreme Court allowed the appeal, set aside the High Court judgment convicting the appellant, restored Trial Court’s acquittal order, and directed refund of fine if deposited – Appellant acquitted of all charges [Para 39].

Civil Law - MSMED Act – Limitation Act Applicability – Conciliation and Arbitration Proceedings – Section 18 MSMED Act – Partial Applicability of Limitation Law – Supreme Court held Limitation Act applies to arbitration under Section 18(3) MSMED Act, preventing recovery of time-barred claims through arbitration – However, Limitation Act does not apply to conciliation under Section 18(2) MSMED Act – Time-barred claims can be settled through conciliation based on party agreement and Section 25(3) of Contract Act – High Court decision set aside partially to this extent [Paras 1-54].

Arbitration Proceedings – Section 18(3) MSMED Act – Section 43 ACA Applicable – Non-Applicability of Section 2(4) ACA – Supreme Court affirmed applicability of Section 43 ACA to arbitration under MSMED Act owing to special deeming provision in Section 18(3) and overriding effect under Section 24 MSMED Act – Time-barred claims held non-maintainable in arbitration proceedings [Paras 35-43].

Conciliation Proceedings – Section 18(2) MSMED Act – Time-Barred Claims Allowed – Conciliation proceedings held non-adjudicatory and voluntary in nature – Time-barred claims can be pursued for amicable settlement under conciliation proceedings despite expiration of limitation period – Settlement agreements under conciliation valid and enforceable under Section 25(3) Contract Act [Paras 25-34].

Acknowledgment of Debt – Section 22 MSMED Act – Balance Sheet Entries – Disclosure of unpaid amounts in buyer’s financial statements does not automatically amount to acknowledgment under Section 18 Limitation Act – Whether an entry amounts to acknowledgment depends on factual context and legal compliance with Section 18 Limitation Act [Paras 49-50].

Decision – Appeals Partly Allowed – Supreme Court upheld High Court’s decision on applicability of Limitation Act to arbitration proceedings – Reversed High Court’s holding on conciliation, allowing settlement of time-barred claims through conciliation – Supreme Court clarified that suppliers can seek recovery through conciliation even after expiry of limitation but arbitration remains bound by limitation period – Appeals partly allowed [Paras 51-52].

Motor Accident Compensation – Principle of Pay and Recover – Section 166 of Motor Vehicles Act – Appeal Allowed – The appellants, legal representatives of the deceased, challenged rejection of insurer’s liability to pay compensation due to the status of the deceased as gratuitous passenger and non-payment of premium for such coverage – The Supreme Court held that despite policy restrictions, the principle of “pay and recover” must apply, directing the insurer to pay compensation to claimants first and recover the same from the owner – Held: Insurer liable to pay the enhanced compensation to claimants and recover from vehicle owner, applying equity principles [Paras 13-18, 22].

Driving Licence Validity – Commercial Vehicle Driven with LMV Licence – Driver Exonerated – Although the vehicle involved was a commercial one (TATA 407 Truck), the Court affirmed that no special endorsement was required as the driver possessed a valid Light Motor Vehicle (LMV) licence, and the vehicle’s weight did not exceed 7500 kg – Held: Driver held not liable due to valid licence coverage under recent constitutional bench judgment [Paras 10, 19].

Enhanced Compensation – Revision of Conventional Heads – Compensation Increased – Supreme Court applied the principle laid down in Pranay Sethi and subsequent rulings to enhance compensation under conventional heads such as loss of estate, loss of consortium, and funeral expenses by 10% considering periodical revisions – Compensation enhanced from ₹19,53,000/- to ₹26,97,500/- with 6% interest per annum [Paras 20-21].

Decision – Appeal Allowed – The Supreme Court allowed the appeal filed by claimants, modified the compensation award, held insurer liable to pay the revised compensation with interest and recover from the vehicle owner, with direct payment directed into claimants’ bank accounts [Paras 22-23].

Civil Law - Inheritance Rights of Tribal Women – Right to Equality under Constitution – Sections 2(2) of the Hindu Succession Act and Section 6 of the Central Provinces Laws Act, 1875 – Appeal Allowed – The Supreme Court allowed the appeal of the legal heirs of a tribal woman, overturning the concurrent findings of the Trial Court, First Appellate Court, and High Court which denied them inheritance rights – It was held that in absence of any established custom excluding women from inheritance and non-applicability of Hindu Succession Act to Scheduled Tribes, justice, equity, and good conscience must prevail – Court directed equal property rights for the female legal heirs, restoring the constitutional mandate of equality – Judgments of the courts below set aside [Paras 3, 6, 13, 15, 17, 19, 20, 28-29].

Customary Law – Burden of Proof – Exclusionary Custom not Proved – The Court held that both appellants and respondents failed to establish any customary law governing succession among the Gond tribe – In absence of any specific law or proven custom, courts cannot presume exclusion of women from inheritance – The High Court and subordinate courts wrongly assumed patriarchal customs, which cannot be inferred without proof [Paras 4-9, 13].

Repeal of Statute – Continuing Application of Justice, Equity and Good Conscience – Section 6 of the Central Provinces Laws Act, 1875 – Repeal of the 1875 Act does not affect accrued rights – Supreme Court held that accrued inheritance rights remain unaffected post repeal due to savings clause – The High Court erred in dismissing claims on the ground of repeal [Paras 15-17].

Gender Equality – Constitutional Mandate of Article 14 – Right to Equal Share in Ancestral Property – The Supreme Court reinforced the application of gender equality under Article 14 – Denial of succession rights solely based on gender without proven exclusionary custom was held unconstitutional – Reference made to landmark constitutional jurisprudence on equality to extend rights to female heirs [Paras 20-29].

Final Decision – Judgments of the Trial Court, First Appellate Court, and High Court were set aside – Appeal allowed in favour of the appellants, granting equal share in ancestral property to legal heirs of tribal woman – Costs not awarded [Para 29].

Succession Law  – Section 63 of the Indian Succession Act – Will Dispute - Suspicious Circumstances – Proof of Free Disposing Mind – Appeals Dismissed – The appellant, propounding a Will executed by his deceased uncle Maya Singh, was granted decree of ownership of suit land by the Trial Court and First Appellate Court – High Court reversed concurrent findings on grounds of suspicious circumstances, particularly the non-mention of testator’s wife and lack of reasons for her disinheritance – The Supreme Court upheld the High Court’s decision, affirming that such omissions raised serious doubts regarding the genuineness of the Will and negated proof of free disposing mind of the testator – Appeal dismissed and High Court’s finding upheld [Paras 1, 8, 18-22].

Execution of Will – Standard of Proof – Requirement to Dispel Suspicion – The Court reiterated that when a Will is surrounded by suspicious circumstances, mere proof of signatures or registration is insufficient – Propounder must dispel doubts to the satisfaction of the court and establish the Will was executed voluntarily by the testator – In this case, suspicious circumstances remained unrefuted, rendering the Will invalid [Paras 11-13].

Inheritance Rights of Spouse – Disinheritance without Justification – Constitutional and Legal Scrutiny – The Court observed that failure to mention a lawful spouse and absence of justification for her exclusion from inheritance in the Will is a significant suspicious factor – Given evidence of harmonious relationship between testator and his wife, unexplained disinheritance suggested possible undue influence by the propounder, vitiating the Will [Paras 19-20].

Concurrent Findings Reversed by High Court – Judicial Conscience Principle Upheld – The Supreme Court endorsed the High Court’s reversal of concurrent findings, holding that courts have a solemn duty to scrutinize Wills in light of equity and fairness, especially when the natural heir is excluded without explanation – Suspicion was not rebutted, and the appeals were dismissed affirming the High Court's decree in favour of the respondent-wife [Paras 18-22].

Decision – Appeals Dismissed – The Supreme Court affirmed the High Court's judgment declaring the first respondent as the rightful owner and in possession of the suit land – Appeals dismissed with no costs awarded [Para 22].