Contract Law – Clause Requiring Minimum Service Period – Not Restraint of Trade – Appeal Allowed - The Supreme Court held that Clause 11(k) of the appointment letter, requiring an employee to serve a minimum of three years or pay ₹2 lakh as liquidated damages, was not violative of Section 27 of the Contract Act – Such negative covenants during the subsistence of an employment contract are not considered restraint of trade – Held: Clause valid and enforceable [Paras 13–16, 35].

Public Policy – Standard Form Employment Contract – No Inequality of Bargaining – Appeal Allowed - The Court rejected the argument that the clause was imposed through unequal bargaining power – Held: The clause was part of a legitimate strategy to curb attrition in a competitive environment and was not unconscionable or unfair – Not opposed to public policy under Section 23 of the Contract Act [Paras 18–21, 27].

Liquidated Damages – ₹2 Lakhs Not Disproportionate – Appeal Allowed - The clause requiring ₹2 lakh payment for premature resignation was held reasonable and not causing unjust enrichment – Recruitment process costs, administrative disruptions, and public sector constraints justified the amount – Respondent paid under protest but failed to establish excessive hardship [Paras 28–31].

Decision – High Court Order Set Aside – Restrictive Covenant Upheld - The Supreme Court allowed the appeal and restored the enforceability of Clause 11(k) – High Court’s reliance on prior decision in BEML held inapplicable due to different factual context – Civil Appeal No. 11499 of 2016 dismissed following same reasoning [Paras 32–37].

Custom Law - Customs Exemption – Administrative Circular Cannot Override Statutory Notification – Appeal Allowed - The Supreme Court held that Circular No. 10/2004-Cus., which expanded the scope of excluded goods under Notification No. 53/2003-Cus., was legally unsustainable – Such a circular cannot add conditions or restrict exemptions granted by a statutory notification under Section 25 of the Customs Act – Held: Circular had no legal consequence and could not deny exemption to crude degummed soyabean oil [Paras 30–36, 58(i)].

Manufacture – Crude Degummed Soyabean Oil is Distinct Product – Not Agricultural – Appeal Allowed - The Court found that the process to extract crude degummed soyabean oil from soyabean constituted ‘manufacture’ resulting in a distinct, marketable product – Rejected the High Court’s view that crude oil retained the identity of soyabean – Held: Crude degummed soyabean oil is not an agricultural product and thus not excluded from exemption under Notification No. 53/2003 [Paras 40–57, 58(ii)-(iv)].

EXIM Policy – Entitlement Under Duty-Free Scheme – Benefit Restored – Appeal Allowed - The appellant, a recognized status holder, was entitled to duty-free import benefit under the 2002–2007 EXIM policy – Import through MMTC and the classification under Chapter 15 supported their claim – Demand of duty by Customs and High Court’s order upholding it were both quashed [Paras 5–8, 58(v)–60].

Service Law – Absorption of Employees – Right to Pension – Functional Integration – Absorbed Employees Entitled to Pension – Absorbed employees from dissolved electricity co-operative societies claimed parity in pension benefits with regular MPSEB employees – Supreme Court held that once absorbed, these employees are entitled to pension under MPSEB from date of absorption – Pre-absorption service not countable towards qualifying pensionable service – Functional integration post-merger mandates uniform treatment – Denial of pension to similarly placed employees violates equity and parity principles [Paras 4-6, 18-23].

Pension – Qualifying Service – Interpretation of Rules – Pre-Absorption Service Not Pensionable – Under MP Civil Services (Pension) Rules, 1976, only service rendered under government-regulated terms qualifies – Thus, pre-absorption service in co-operative societies, which were not under state regulation, cannot be counted – Court applied Rule 3(p), 12(2), and 13(1) to hold that pension is admissible only from date of absorption [Paras 24-25].

Article 142 – Equitable Relief – Uniformity Mandated – Apex Court exercised Article 142 to ensure no discrimination among similarly placed employees – Despite High Court Full Bench judgment denying pension to some absorbed employees, Court granted parity to all absorbed society employees w.e.f. date of absorption – Ensured uniform and equitable resolution of complex and long-pending litigation [Paras 17, 26].

Decision – Appeals Partially Allowed – Appellants entitled to pension from date of absorption into MPSEB, but pre-absorption service not to be counted for qualifying period – Impugned orders modified accordingly – Respondents directed to implement and pay arrears within four months [Paras 25-26].

Writ - Designation of Senior Advocates – Validity of Indira Jaising Guidelines – Guidelines Partially Overruled – Supreme Court revisits framework laid down in Indira Jaising-1 and Indira Jaising-2 – Held: 100-point assessment and interview system found unworkable and subjective – Paragraph 73.7 of Indira Jaising-1 deleted – New rule-based regime to be framed by all High Courts and Supreme Court [Paras 74-77, 87(i)-(v)].

Interview System – Constitutionality and Practicality – Interview Abolished – Interview/interaction allocating 25 points deemed insufficient to assess personality and dignity of senior advocates – Held: Brief interviews fail to uphold professional dignity and cannot reliably determine integrity or competence [Paras 67-70].

Inclusivity and Trial Court Advocates – Designation Should Not Be Monopolized – Emphasis on Diversity – Court highlights the need to include advocates from Trial and District Courts and specialized tribunals – Held: Standing at Bar not limited to appearances in Constitutional Courts – Full Court must ensure diverse and equitable designations [Paras 55, 78-79].

Role of Bar Members in Assessment – Committee Composition Modified – Participation of Advocates in Decision-Making Removed – Court disapproves inclusion of bar members in Permanent Committee’s scoring – Held: Decision-making must rest solely with the judiciary as per Section 16(2) of Advocates Act [Paras 63-64].

Applications for Designation – Permissible Practice – Consent Sufficient – Court upholds application-based system for practical reasons – Held: Filing application amounts to implied consent; deserving advocates may still be designated suo motu with consent [Para 77].

Secret Ballot – Discretion of Full Court – Use Not Prohibited – Held: Voting by secret ballot is neither mandatory nor barred – Full Court empowered to decide voting method as per facts of each case [Para 81].

Rule-Making Mandate – Uniform Framework Required – High Courts Directed – All High Courts directed to frame rules within four months – Rules must ensure transparency, fairness, periodic review, and bar-wide consultation [Paras 83-84, 87(ii)].

Decision  – Indira Jaising-1 Para 73.7 Deleted – New Rules Required – Existing processes under Indira Jaising regime may continue; no new applications to be processed without rules framed under this judgment – Applications in current matters allowed and disposed [Paras 87-90].

Consumer Law – Flat Allotment Dispute – Execution of Agreement – MOFA – Supreme Court Upholds Alternate Flat Possession – Builder cancelled allotment despite part payment and failed to execute agreement – NCDRC directed execution with compensation, later apartment found alienated in violation of stay – Supreme Court allowed substitution with similar flat, directed execution under MOFA – Non-compliance remedied through quantified financial directions – Builder to receive specified payment in full satisfaction of claims [Paras 1-6, 13-14].

Real Estate – Breach of Interim Orders – Apartment Alienated Despite Stay – Appellant alienated flat after stay against third-party rights – NCDRC rejected modification citing contempt – Supreme Court allowed alternate allotment due to absence of contempt petition, stressing equity over technicality [Paras 2, 4, 6].

Equitable Relief – Adjustment of Dues – Final Settlement Ordered – Due to builder’s delays, nondisclosure of carpet areas, and unilateral action, Court quantified dues at Rs. 1.40 crore – Included interest, taxes, and miscellaneous charges in lieu of further claims up to possession date – Post-possession dues to be borne by buyer [Paras 10-14].

Decision – Miscellaneous Application Disposed – Respondent directed to pay Rs. 1,40,71,000 within eight weeks – Parties to execute sale deed within two months thereafter – Costs of registration to be borne by respondent – Structural modification restrictions lifted [Paras 14-15].

Criminal Law – Bail – NDPS Act and UAPA – Bail Denied – Appellant accused of coordinating smuggling of Afghan-origin heroin via fictitious firm – Despite absence of contraband recovery from the appellant’s consignment, evidence of meetings, proxy control of firm, and documentary manipulation established prima facie complicity – Court held that the cumulative material justified continued custody under Section 43D(5) of UAPA [Paras 5-16, 26-28].

Liberty – Preventive Detention – Article 21 – No Automatic Bail for Long Incarceration – Though pre-trial detention cannot be punitive, continued custody upheld due to nature of offence, flight risk, and pending examination of key witnesses – Court permitted renewal of bail plea after six months or upon substantial progress in trial [Paras 24, 30, 33].

Witness Protection – Risk of Tampering – Bail Refused – One witness found dead on date of deposition; two untraceable – High risk of witness influence or elimination justified rejection of bail at interim stage – Directions issued for accelerated witness examination [Paras 30-31, 35(ii)-(iii)].

UAPA – Section 43D(5) – Prima Facie Satisfaction Sufficient – Bail denied under UAPA does not require proof beyond reasonable doubt – Material must demonstrate plausible complicity without being inherently unreliable – Held: Prosecution narrative not improbable at current stage [Paras 23-24, 27].

Terror Financing – Allegation Deferred – No Conclusive Evidence – Though UAPA invoked, Court declined to classify appellant’s actions as terror financing without strong evidentiary foundation – Allegations too premature to attract such a finding [Para 34].

Decision – Bail Rejected – Appellant not entitled to regular bail presently – Liberty granted to reapply after six months or significant trial progress – Trial court directed to expedite proceedings and examine core witnesses without interruption [Paras 33, 35(i)-(iv)].
 

Criminal Law - Cruelty and Dowry Demand – Conviction under Section 498A IPC and Section 4 of DP Act – Conviction Set Aside – The appellant was convicted based on vague allegations of mental and physical cruelty and dowry demands – The complainant failed to substantiate claims with specific instances or medical evidence – No corroborative or independent testimony beyond statements of complainant and her father – Held: General and omnibus allegations insufficient to sustain conviction under criminal law – Conviction under Section 498A IPC and Section 4 of the DP Act set aside [Paras 3.4, 4, 9-11].

Abuse of Protective Legislation – Caution Against Misuse – Judicial Concern Noted – The Court noted with concern the trend of implicating entire families of husbands without specific allegations – Held: Courts must guard against misuse of Sections 498A IPC and 3/4 of the DP Act – Observed tendency to criminally prosecute distant relatives and aged parents without evidence [Para 13].

Scope of Revisional Jurisdiction – Duty to Re-examine Evidence – High Court's Summary Dismissal Criticized – The Supreme Court found that the High Court, while exercising revisional powers, failed to apply judicial mind or consider evidence on record – Held: The High Court should have scrutinized the correctness of lower court judgments more thoroughly [Paras 7, 12].

Decision – Appeal Allowed – Conviction Set Aside – The Supreme Court allowed the appeal, acquitted the appellant of all charges under Section 498A IPC and Section 4 of the DP Act – Held: Continuing prosecution would amount to abuse of process of law [Paras 14-15].
 

Arbitration Law  – Scope of Judicial Review under Section 11 – Confined to Existence of Agreement – High Court Erred – Supreme Court reaffirmed that under Section 11(6A) of the Arbitration Act, courts are confined to examining the existence of an arbitration agreement – Determining arbitrability of individual claims is beyond this scope – Any issue of non-arbitrability should be left for the arbitral tribunal – High Court’s exclusion of certain claims held to be erroneous [Paras 6-12].

Excepted Matters – To Be Considered by Tribunal, Not Court at Appointment Stage – Exclusion Set Aside – High Court excluded claims based on contract clauses 50 and 50.2 as “excepted matters” – Held: This was premature and not permissible under Section 11 – Parties may raise such objections before tribunal, which will decide independently [Paras 3, 12-13].

Precedents – Preference for Larger Bench Decisions – Emaar India Overruled by Later Three-Judge Decision – Court held that reliance on Emaar India Ltd. v. Tarun Aggarwal Projects LLP (2023) was misplaced – A more recent three-judge bench in SBI General Insurance v. Krish Spinning (2024 INSC 532), applying In Re: Interplay (2023 INSC 1066), clarified that only prima facie existence of arbitration agreement is to be tested – Jurisdictional limits under Section 11 reaffirmed [Paras 10-12].

Decision – Appeal Allowed – Arbitration to Proceed on All Claims – Supreme Court set aside part of High Court’s order that excluded claims in para 48(ii)-(iv) of claim petition – Held: Tribunal to decide arbitrability without being influenced by High Court’s findings – No costs awarded [Para 13].
 

Limitation Law - Delay Condonation – Re-litigation on Identical Grounds – Delay Not Condoned – Respondents' explanation for 1116 days delay in filing appeal under Order XLI CPC was previously adjudicated under Order IX Rule 13 CPC and dismissed by High Court and Supreme Court – Re-urging same grounds held to be impermissible and an abuse of process – Repetition of insufficient cause cannot warrant fresh consideration under a different provision [Paras 27-30].

Applicability of Precedent – Misapplication of N. Mohan Case – Condonation Set Aside – High Court erroneously relied on N. Mohan v. R. Madhu (2020) 20 SCC 302 to condone delay – Distinguished on facts as defendants in present case had appeared, filed written statements, and later defaulted, unlike in N. Mohan where summons were not served – Hence, reliance misplaced [Paras 25-26].

Concurrent Remedies – Section 96(2) Appeal and Order IX Rule 13 Application – Not Mutually Exclusive but No Duplication of Grounds – Though legally maintainable to file appeal under Section 96(2) post Order IX Rule 13 rejection, same explanation for delay cannot be recycled without new material – Filing under another provision does not reset limitation clock without distinct cause [Para 30].

Limitation Law – Strict Interpretation – Generosity Not Permitted – Limitation law requires strict adherence and cannot be relaxed merely for equity – Absence of bona fide explanation bars condonation – Reference made to Popat Bahiru Goverdhane (2013) 10 SCC 765 and Maniben Devraj Shah (2012) 5 SCC 157 – Delay must be justifiable on record and not based on liberal approach [Paras 28-32].

Decision – Delay Not Justified – Appeal Allowed – Impugned High Court order dated 25.04.2023 condoning delay set aside – Civil Appeal allowed and delay condonation rejected – Appeal disposed with no costs [Paras 34-36].