Motor Vehicles – Compensation – Fatal Accident – Reassessment of Income – Deceased died in road accident due to negligent driving of bus which deviated from its permitted route – Tribunal awarded compensation of Rs. 18.86 lakhs based on notional income of Rs. 8,000/month – High Court reassessed income at Rs. 15,750/month with 40% future prospects, applying multiplier of 16 and appropriate deductions for dependents – Total compensation enhanced to Rs. 31.84 lakhs – Held: High Court correctly applied settled principles for assessing loss of dependency and consortium benefits [Paras 4–5.1].

Motor Vehicles – Insurance Liability – Route Permit Violation – Appellant-owner’s bus did not have permit to enter Channapatna City where accident occurred – High Court applied ‘pay and recover’ principle relying on Amrit Paul (2018) 7 SCC 558 – Held: Driving vehicle outside permitted route is a fundamental breach of policy – Insurer must first compensate third parties, but entitled to recover from insured – Deviation from permit route justifies application of ‘pay and recover’ principle [Paras 5.2–10].

Motor Vehicles – Insurance Law – 'Pay and Recover' Doctrine – Applicability – Court reaffirmed that in cases involving lack of valid permit, fake or no driving license, or unauthorized goods carriage, insurer is liable to third party but can recover from owner – Cited precedents in Swaran Singh (2004) 3 SCC 297, Kamla (2001) 4 SCC 342, Parminder Singh (2019) 7 SCC 217, S. Iyyapan (2013) 7 SCC 62 – Held: Principle balances rights of victims with contractual limitations of insurers – High Court’s direction upheld [Paras 7–10].

Decision: Appeals dismissed – Compensation enhanced – Insurer directed to pay and recover from owner – No order as to costs [Para 11].

Criminal Law – Quashing – Offence under Sections 379 and 411 IPC – Petitioner allegedly misused relationship with complainant’s wife to misappropriate cheque, hundis, and gold necklace belonging to complainant’s mother – Police report and private complaint led to cognizance only under Section 420 IPC – Sessions Court modified order and directed Magistrate to reconsider applicability of Sections 379 and 411 IPC – Supreme Court held that the question of taking cognizance under Sections 379 and 411 IPC must be considered afresh by the Magistrate uninfluenced by the Sessions Court’s observations – Held: Trial Magistrate to independently assess whether ingredients for theft and receipt of stolen property are made out – SLPs disposed of with liberty to Magistrate [Paras 5–7].

Insolvency and Bankruptcy Code – Maintainability of Section 7 IBC Petition – Preference Shareholders – Financial Debt – Appellant, a preference shareholder, filed Section 7 petition for non-payment of redemption amount of CRPS – NCLT and NCLAT dismissed petition, holding CRPS did not constitute financial debt – Supreme Court upheld dismissal – Held: Preference shares are part of share capital, not debt – Redemption contingent on company having profits or proceeds of fresh issue – Appellant ceased to be creditor upon accepting preference shares in lieu of receivables – No default under IBC established – Petition under Section 7 IBC not maintainable [Paras 1, 2, 19, 20, 24-26, 29-34, 36, 38-39, 46-47, 50].

Company Law – Nature of Preference Shares – CRPS do not constitute debt – As per Section 55 of Companies Act, redemption of preference shares only permissible from profits or fresh share issue – Preference shareholders are not creditors – Preference shares are part of capital structure – Non-redemption does not convert them into debt – Held: Even after maturity, preference shares remain share capital, not enforceable debt – No right to initiate insolvency proceedings arises [Paras 19-24, 26-27].

Interpretation of IBC – Financial Debt – Essential elements – For a claim to be financial debt under Section 5(8) IBC, there must be disbursal against consideration for time value of money – CRPS not disbursed amount – No loan or borrowing established – No commercial effect of borrowing under Section 5(8)(f) IBC – Held: Preference share capital lacks foundational elements of financial debt – Conversion of receivables into CRPS extinguished earlier debt – CRPS issuance was an equity infusion, not a debt transaction [Paras 28-31, 46-48].

Default under IBC – Applicability of Section 3(12) – Default requires due and payable debt that remains unpaid – Redemption of CRPS not due as company had no profits or fresh issue proceeds – No default within meaning of Section 3(12) IBC – Petition under Section 7 rightly rejected on this ground [Paras 34-36].

Corporate Insolvency – Entries in Books of Account – Not conclusive – Treatment of CRPS in financial statements as unsecured loan or financial liability irrelevant – Accounting treatment cannot override statutory provisions or alter legal nature of transaction – Entries in accounts do not determine existence of financial debt under IBC [Paras 43-45].

Distinction between Creditor and Shareholder – Redeemable Preference Shareholder cannot be equated with creditor – Supreme Court reiterated that redemption obligation does not create creditor-debtor relationship – Conversion of outstanding receivables into CRPS amounted to capital restructuring, not a borrowing – No right to recover via insolvency proceedings [Paras 38-39, 49].

Precedents Distinguished – Case law cited by appellant including Sanjay D Kakade, Global Credit Capital, and Pioneer Urban Land held inapplicable – Each case turned on distinct facts or involved different forms of debt – Present case involved clear and conscious conversion of dues into equity capital – Earlier receivables stood extinguished – No underlying intent to mask borrowing established [Paras 38, 41-42, 49].

Decision: Appeal dismissed – Application under Section 7 IBC held not maintainable – Appellant, being a preference shareholder, is not a financial creditor – No order as to costs [Para 50].

Criminal Law – Double Homicide – Unlawful Assembly – Common Object – Boundary dispute between related villagers escalated into a violent clash – Appellants armed with sharp-edged spades (phawaras) attacked complainant side causing instantaneous death of two persons and grievous injuries to others – Evidence revealed appellants came armed and initiated attack – Held: Assembly had common object to commit murder and cause injuries; findings of guilt under Sections 302/149 and 307/149 IPC fully justified – No perversity in concurrent findings of Trial Court and High Court [Paras 29-31, 45, 51-52].

Appellate Review – Scope under Article 136 – Concurrent findings on fact and law – Supreme Court reiterates that interference is warranted only when findings are manifestly perverse, based on no evidence, or result in grave miscarriage of justice – Since both courts below had examined the evidence threadbare and reached concurrent conclusions supported by record, no ground to interfere made out [Paras 23-25].

Evidence – Ocular vs Medical – Injured Eyewitness Testimony – Reliability – PW-2 (injured eyewitness) sustained multiple wounds consistent with prosecution case – Presence at scene admitted even by defence – Her version corroborated by medical evidence and by PW-3 and PW-4 – Minor discrepancies or omissions in narration do not dilute overall credibility – Medical evidence fully supports ocular account regarding use of sharp weapons and location of injuries – Held: Injured eyewitness testimony has greater evidentiary value and cannot be discarded on trivial inconsistencies [Paras 33-41].

Motive – Not Sine Qua Non where Direct Evidence Exists – Existence of long-standing enmity over partition of agricultural fields and a recently demolished ridge (mendh) established motive for assault – Court reiterates that where credible eyewitness evidence is available, motive assumes secondary importance – However, motive here corroborates the prosecution narrative, showing premeditated aggression by accused party [Paras 42-43].

Culpable Homicide – Section 300 Exception 4 – Plea of Sudden Fight and Free Fight Rejected – The incident was not a spontaneous brawl but a deliberate attack by armed assailants – The nature of injuries on vital parts such as skull and head, inflicted with lethal implements, demonstrates intention and knowledge necessary to constitute murder – Exception 4 to Section 300 IPC not applicable – Conviction rightly under Section 302 IPC and not reduced to Section 304 IPC [Paras 44-45].

FIR – Delay in Lodging – Explanation Acceptable – Cross-FIR filed after taking injured to hospital in Chandigarh – Delay reasonably explained and caused by priority of medical care – Law well settled that delay in lodging FIR is not fatal when satisfactorily explained – Held: Delay in filing cross-case does not undermine prosecution version supported by consistent eyewitness and medical evidence [Paras 46-48].

Investigation – Non-Recovery of Weapon – Not Fatal to Prosecution Case – Though weapons (phawaras and lathis) were not recovered, the ocular testimony and post-mortem reports conclusively established use of such instruments – Non-recovery or non-production of weapons not fatal when other evidence is unimpeachable – Prosecution evidence found natural, consistent, and trustworthy [Paras 49-50].

Defence Plea – Self-Defence and Suppression of Genesis – Defence plea of self-defence and suppression of genesis rejected – No convincing evidence to show complainant side was aggressor – Injuries on accused were superficial and not contemporaneous – Held: Defence version an afterthought and cannot displace consistent prosecution case [Paras 27-30, 34].

Principles Reiterated – Credibility of injured witnesses; limited interference under Article 136; delay in FIR not fatal; non-recovery of weapons immaterial when supported by medical and ocular evidence; motive though not indispensable strengthens prosecution version; Exception 4 to Section 300 IPC not attracted in premeditated assault cases [Paras 23-52].

Decision: Appeals dismissed – Conviction and sentence under Sections 302/149 and 307/149 IPC affirmed – Appellants directed to surrender forthwith; bail bonds cancelled – Liberty granted to seek remission as per statutory policy – Judgment of the High Court upheld in toto [Paras 51-53].

Arbitration – Appointment of Arbitrator – Scope of Judicial Interference under Section 11(6) – Appellant suffered an arbitral award in dispute with third-party contractor – Based on contract clause shifting liability for award to respondent, appellant sought arbitration – High Court rejected application holding that liability arises only upon payment of award and cause of action had not arisen – Supreme Court held that existence of arbitration agreement was undisputed – Whether claim is arbitrable or cause of action has arisen is matter for arbitral tribunal to decide – Reiterated limited scope of judicial scrutiny under Section 11(6) as clarified in Office for Alternative Architecture and In Re: Interplay – Held: High Court erred in refusing to refer dispute to arbitration – Appeal allowed – Justice Bhaskar Bhattacharya (Retd. C.J., Gujarat High Court) appointed as sole Arbitrator [Paras 8–14].

Public Interest Litigation – Unauthorized Constructions – Right of Hearing – High Court, in a PIL, directed closure of 172 civil suits and removal of unauthorized constructions in Gurugram, citing violations of planning norms – Appellants (landowners/occupiers) were not parties to the writ petition – Supreme Court held: Directions issued without impleading affected parties and affording hearing violate principles of natural justice – Order liable to be set aside [Paras 2, 6, 9]

Urban Development – Jurisdiction of Civil Courts – Section 15 of HDRUA Act – High Court directed closure of pending civil suits citing bar on jurisdiction under Section 15 – Held: Civil court jurisdiction cannot be conclusively ousted without adjudication – Affected persons entitled to be heard before such directions are passed [Paras 5, 6, 9]

Administrative Law – Due Process – Mandamus issued by High Court for demolition/removal of constructions – Held: Authorities must afford opportunity to affected owners/occupiers before enforcing such actions – Determination of illegality must follow due process [Paras 8–10]

Procedural Directions – Appeals Allowed – High Court’s order dated 13.02.2025 set aside – Writ Petitions (CWP Nos. 1528 and 2106 of 2021) restored – Appellants allowed to file appropriate applications within 2 weeks – High Court to re-decide the matter after hearing all affected parties, preferably within 6 months – State directed to give wide publicity to facilitate impleadment of affected persons [Paras 10–12]

Decision: Appeals allowed – High Court order set aside – Writ Petitions restored for fresh adjudication after affording hearing to all affected persons – Pending applications disposed of.

Practice and Procedure – Adverse Remarks Against Counsel – Modification of Order – Supreme Court had imposed Rs. 2 lakh costs and made adverse observations against State Election Commission’s counsel for persistent insistence despite repeated disinclination expressed by the Bench – Counsel filed Miscellaneous Application seeking expungement and waiver of cost – Held: Once Court indicates its mind, further insistence by counsel is inappropriate and undermines courtroom decorum – However, considering unqualified apology and first-time conduct, adverse remarks and cost are deleted with caution against future recurrence [Paras 3, 6–9].

Advocacy – Duty Towards Court vs Client – Counsel must strike balance between duty to client and maintaining decorum of court – Persistent submissions after clear judicial indication disturb dignified functioning of Court – Assurances from senior bar members considered in granting relief [Paras 6–7].

Decision: Application allowed – Remarks against counsel expunged – Cost of Rs. 2,00,000 deleted – Counsel cautioned not to repeat such conduct [Para 9].

Criminal Law – Threatening Witness to Give False Evidence – Section 195A IPC – Legislative Intent – Section 195A IPC (introduced by Act 2 of 2006) created a distinct offence of threatening or intimidating a witness to induce false evidence – Classified as a cognizable offence in the First Schedule of CrPC – Unlike Sections 193–196 IPC which are non-cognizable – Held: The offence under Section 195A IPC stands outside the procedural fetters of Section 195(1)(b)(i) CrPC – Police can register FIR and investigate under Sections 154 and 156 CrPC without prior complaint from the court [Paras 17–20, 28–30].

Criminal Procedure – Section 195A CrPC – Additional Remedy, Not a Restriction – Section 195A CrPC (introduced by Act 5 of 2009) allows a witness or any other person to file a complaint for the offence under Section 195A IPC – It provides an optional route and does not preclude registration of FIR by police – The word “may” in Section 195A CrPC denotes discretion and not compulsion – Both mechanisms (police FIR and complaint before Magistrate) coexist harmoniously [Paras 19–21, 29].

Interpretation of Statutes – Harmonious Construction – Section 195A IPC and Section 195A CrPC to be construed together to give full effect to legislative intent – Court held that omission to specifically exclude Section 195A IPC from Section 195(1)(b)(i) CrPC was not a casus omissus – Judicial interpretation should not add words but reconcile provisions logically – Harmonious construction ensures that threat to witness is actionable immediately, preserving the deterrent purpose of the amendment [Paras 27–29].

Cognizable Offence – Registration of FIR – Validity – As Section 195A IPC is cognizable, police officers are empowered under Section 154 CrPC to register FIR and investigate without Magistrate’s order – Filing of court complaint is not mandatory – Delay in registering FIR or confusion among authorities cannot curtail this power – Held: High Courts erred in insisting on procedure under Section 195(1)(b)(i) CrPC [Paras 28–30].

Doctrine – Casus Omissus – Not Applicable – Laxity in legislative drafting cannot justify judicial legislation – Court cannot rewrite statute to create two classes of offences under Section 195A IPC depending on whether threat occurs in relation to court proceedings or outside – Clear statutory language and structure show legislative intent to treat Section 195A IPC independently [Paras 26–27].

Precedents – Divergent High Court Views Resolved – Delhi, Madhya Pradesh, and Calcutta High Courts correctly held that Section 195A IPC is cognizable and police can register FIR – Gauhati and Kerala High Courts wrongly applied Section 195(1)(b)(i) CrPC – Conflict resolved in favour of wider interpretation recognizing police power to act directly [Paras 21–24, 30].

Statutory Scheme – Historical Context – Chapter XI IPC (“Offences against Public Justice”) includes Sections 191–195A – While Sections 193–196 IPC were non-cognizable and required court complaint, Section 195A IPC, inserted in 2006, was deliberately made cognizable to prevent intimidation of witnesses before or during judicial proceedings – Legislative purpose was to enable swift protection of witnesses through immediate police intervention [Paras 3–10, 17–19, 28].

Case Law – Application of Prior Rulings – Reliance on Union of India v. Ashok Kumar Sharma (2021) 12 SCC 674 rejected as inapplicable; statutory context under Drugs & Cosmetics Act, 1940 distinguished – Followed Salib @ Shalu v. State of U.P. (2023) 20 SCC 194 to clarify that Section 195 CrPC does not control Section 195A IPC [Paras 18, 25].

Constitutional Law – Judicial Restraint – Court reiterates principle that interpretation must give effect to legislative intent without creating procedural barriers defeating substantive justice – Harmonization of CrPC and IPC provisions ensures effective protection of witnesses, fulfilling constitutional obligation under Article 136 jurisprudence [Paras 27–30].

Decision: Appeals allowed – Orders of Kerala and Karnataka High Courts set aside – FIRs and cognizance orders restored – Offence under Section 195A IPC held cognizable and independently triable – Police empowered to investigate without complaint under Section 195(1)(b)(i) CrPC – Accused Suni @ Sunil directed to surrender; liberty to seek bail on other grounds – Proceedings against Basayya Thirakaya Hiremath restored before Trial Court [Paras 30].

Criminal Law – Prevention of Corruption – Demand and Acceptance – Appellant, a Labour Officer, allegedly demanded ₹9,000 bribe and accepted ₹3,000 for license renewal – Trap set by ACB, tainted currency recovered from drawer of appellant's desk – Trial Court acquitted appellant citing inconsistencies in complainant’s account, procedural lapses, negative phenolphthalein test, and credible defence witnesses – High Court reversed acquittal – Held: Acquittal based on plausible view grounded in evidence – High Court failed to consider key contradictions and defence version – Demand and acceptance not proved beyond reasonable doubt – Presumption under Section 20 PC Act not attracted [Paras 1, 10–14, 18–20, 33].

Evidence – Hostile Witness – Credibility – Office attendant (PW-4) turned hostile, admitted to pressure from ACB and supported defence in contemporaneous letter – Defence witnesses (DW-1, DW-2) corroborated absence of accused during alleged bribery moment – High Court unjustifiably rejected their testimony – Held: Defence version plausible, supported by consistent independent evidence – Cannot be discarded merely due to official relationship with accused [Paras 26–30].

Criminal Procedure – Reversal of Acquittal – Appellate Interference – Appellate court must show perversity or grave error in Trial Court's view – High Court failed to address material inconsistencies, speculative reasoning on motive – Suspicion cannot replace proof – Held: Trial Court’s acquittal restored as it was reasonable and based on cogent evaluation of record – No justification for appellate reversal [Paras 11–13, 33].

Public Servants – Legal Authority – Inspection of Registers – High Court held demand for registers by appellant was coercive tactic – Held: Such findings unwarranted – Labour Officers empowered by law to call for records – Written notice issued by appellant validated his actions – No illegality in procedure followed [Para 34].

Decision: Appeal allowed – Conviction set aside – Acquittal restored – Bail bonds discharged [Para 35].