Criminal Law – Bail Application – Prolonged Detention – PMLA Case – Bail Granted – The appellant had been in custody for over two years, facing charges under the PMLA based on an FIR that initially alleged non-scheduled offenses. With the addition of Section 384 IPC, the Enforcement Directorate filed a complaint under Section 44 of the PMLA. The Supreme Court, considering the prolonged detention and the lack of a scheduled offense at the time of filing the complaint, granted bail – Held: Continuation of custody would violate the appellant’s rights under Article 21 of the Constitution of India [Paras 6-10].

Scheduled Offense Requirement under PMLA – FIR Analysis – The Court observed that the initial FIR registered under IPC Sections 186, 204, 353, and 120-B did not contain scheduled offenses. Even after the addition of Section 384 IPC, the charge-sheet failed to establish the commission of a scheduled offense, and therefore, the appellant’s detention under PMLA was unjustified [Paras 5-7].

Constitutional Rights – Article 21 – Right to Liberty and Prolonged Custody – The Court emphasized that prolonged detention without trial, especially when no scheduled offense was established at the time of filing the PMLA complaint, infringed upon the appellant's right to personal liberty under Article 21 [Para 8].

Decision:

Appeal allowed – Bail granted to the appellant with conditions to be determined by the Special Court.

Criminal Law – Bail in NDPS Cases – Section 21(c) NDPS Act – Bail Granted – The appellant had been in custody since April 2023 in connection with the seizure of Codeine Phosphate syrup. Despite the filing of the chargesheet and supplementary chargesheet, the trial was not set to commence until January 2025. The Supreme Court granted bail, considering the prolonged pre-trial detention and the uncertainty surrounding the trial’s conclusion – Held: The appellant to be released on bail, subject to conditions imposed by the Trial Court.

Prolonged Pre-Trial Detention – Right to Liberty – The Court noted that the appellant had been incarcerated for over a year and five months, with the trial yet to begin. The Court emphasized that prolonged pre-trial detention, without concrete progress in trial proceedings, impinges on the appellant’s right to liberty.

Conditions for Bail – Ensuring Compliance – The Court directed the appellant to cooperate with the trial proceedings and not misuse the liberty granted by bail. Any violation of the conditions would lead to cancellation of bail.

Decision: Appeal allowed – Bail granted to the appellant with conditions to be determined by the Trial Court.

Income Tax Law – Revision of Returns – Limitation – Appellant filed revised returns multiple times for the assessment year 1989-90, the last of which was submitted on 29th October 1991 – Assessing Officer refused to consider the return, citing Section 139(5) of the Income Tax Act, which barred the revised return due to the lapse of the one-year time limit – Appeals were filed but the High Court upheld the decision, stating that the revised return could not be entertained as it was barred by limitation – Held: Assessing Officer had no jurisdiction to consider claims made in a time-barred revised return [Paras 1-3].

Appellate Powers of Tribunal – Section 254 of the IT Act – Appellant contended that the Tribunal could consider claims omitted from the original return during assessment proceedings – Reliance placed on Wipro Finance Ltd. v. Commissioner of Income Tax – However, Tribunal did not invoke its powers under Section 254 and instead remanded the case to the Assessing Officer, who had no authority to consider the time-barred return – High Court upheld the decision, finding no fault in the Tribunal's approach [Paras 5-7].

Judgment: Appeal dismissed – High Court's decision affirmed – Revised return filed after the time limit could not be considered by the Assessing Officer – Tribunal erred in remanding the matter for reconsideration by the Assessing Officer, as it lacked the jurisdiction to entertain the claim [Paras 9-11].

Service Law – Recruitment Process – Eligibility Criteria – Quashing of Selection Process – The appellant and others challenged the cancellation of the recruitment process for Junior Engineer (Civil) posts in Bihar, initiated through an advertisement dated 08.03.2019 – The State Government canceled the process following litigation on the eligibility of candidates with diplomas from universities not approved by AICTE – The High Court allowed the cancellation without fully adjudicating the issues – The Supreme Court held that altering the rules after the selection process violates established principles – Fresh merit list ordered with age relaxation provisions [Paras 1-30].

Doctrine of Acquiescence – Participation in Selection Process – Appellants argued that the writ petitioners, having participated in the recruitment process, could not challenge the eligibility criteria after being unsuccessful – The Supreme Court cited established precedents that altering criteria post-selection is impermissible, affirming the vested rights of successful candidates in the selection process [Paras 27-32].

Rule of Law – Arbitrary State Action – The cancellation of the recruitment process, despite completion and the preparation of a final select list, was deemed arbitrary and unjustified – The Court ordered the preparation of a fresh select list considering prior High Court directions and AICTE’s stand on eligibility, providing relief to candidates who were previously disqualified under the 2017 rules [Paras 30, 32].

Decision – Appeal allowed – Cancellation of the recruitment process set aside – Fresh select list to be prepared within three months, and appointments to follow within 30 days thereafter – Provision for age relaxation as a one-time measure for candidates affected by the delayed recruitment process [Paras 30-32].

Criminal Law – Conviction Reversal – Acquittal – The appellants were convicted by the High Court for abduction and murder under Sections 364/34 and 302/34 IPC – The Supreme Court reversed this conviction, holding that the High Court erred in overturning the Trial Court's acquittal of two accused (A-6, A-7) – The High Court’s decision lacked proper reasoning to reverse acquittals, especially when the Trial Court’s view was plausible – Appellants were acquitted as prosecution failed to prove the charges beyond reasonable doubt [Paras 1-30].

Witness Testimonies – Credibility of Eye-Witnesses – The testimonies of prosecution witnesses (PW18, PW2, PW4, and PW5) were inconsistent and unreliable – Discrepancies regarding their presence at the crime scene raised doubts – Non-examination of natural witnesses such as tenants and neighbors further weakened the prosecution’s case – The Court found that PW18’s statement regarding the involvement of A-6 and A-7 was an improvement over the FIR, casting serious doubt on the prosecution’s version [Paras 12-26].

Motive and Circumstantial Evidence – The prosecution’s case largely rested on circumstantial evidence, but the chain of evidence was incomplete – The presence of property disputes provided a motive, but this alone could not prove guilt – The prosecution failed to link the accused directly to the murder, and no reliable evidence of abduction was found – Thus, the Court ruled that the conviction for murder could not be sustained [Paras 27-35].

Decision – Appeal allowed – Conviction set aside – All seven appellants acquitted – They are to be released immediately if not wanted in any other case [Paras 35-40].

Suspension of Sentence – Section 389(1) CrPC – Denial of Parity in Bail – The appellants sought suspension of sentence and release on bail, similar to co-accused Pappu, who was granted bail despite being the primary accused in the murder – High Court rejected the plea on grounds of differing periods of imprisonment served by the appellants and co-accused – Held: The appellants have served less time compared to Pappu, and no parity could be claimed in such a scenario – Bail denial upheld [Paras 4-6].

Criminal Antecedents – Impact on Bail Consideration – Appellant Narendra Singh was alleged to have prior criminal cases, one for which he was on bail – Held: Mere pendency of a trial should not automatically disqualify the appellant from suspension of sentence as he remains innocent until proven guilty – Argument accepted, and bail granted with conditions [Paras 7-12].

Decision: The Supreme Court allowed the appeal, set aside the High Court’s judgment, and suspended the life imprisonment sentences of the appellants. The appellants were granted bail, subject to conditions to be imposed by the Sessions Court. The Court emphasized that failure to participate in the pending criminal appeal proceedings would result in cancellation of the bail [Paras 12-16].

Bail Application – Charges under IPC and POCSO Act – Grant of Bail – Appellant accused of offenses including abduction and sexual assault – Appeal against rejection of bail by the Rajasthan High Court – Argument of consensual relationship due to close age gap between appellant and the minor victim – Held: The appellant has been in custody since May 2024, and the trial will be prolonged with 12 witnesses to be examined – Considering these facts, bail granted with conditions [Paras 2-6].

Bail Conditions – Safeguards Imposed – While granting bail, the Supreme Court directed the appellant not to misuse his liberty, influence witnesses, or associate with the victim in any way – Breach of conditions to result in cancellation of bail [Paras 7-8].

Decision:

The Supreme Court allowed the appeal, granting bail to the appellant. The appellant was directed to present himself before the Trial Court, which would set appropriate bail conditions to ensure his cooperation with the proceedings. Any violation of these conditions would result in the revocation of bail [Paras 9-10].

Money Laundering – Scheduled Offence Requirement – Absence of Scheduled Offence at Time of Complaint – Bail Granted – The appellants were detained for prolonged periods in a PMLA case initiated based on an ECIR and FIR which initially did not include a scheduled offence. The Court noted that when the complaint was filed under Section 44 of the PMLA, there was no scheduled offence in existence as per the Supreme Court’s decision in Pavana Dibbur vs The Directorate Of Enforcement, and subsequent addition of Section 384 IPC did not justify their continued detention. Held: Prolonged custody in the absence of a scheduled offence at the time of the complaint was a violation of Article 21, and the appellants were entitled to bail [Paras 2-8].

Article 21 – Right to Liberty – Prolonged Incarceration in Absence of Scheduled Offence – Bail Granted – The appellants, having undergone incarceration for 2 years and 1 year 9 months respectively, were held to have suffered a violation of their rights under Article 21 of the Constitution due to the absence of a scheduled offence when the PMLA complaint was filed. The Court granted bail, directing the Special Court to release the appellants on appropriate terms and conditions [Paras 8-11].

Scope of Observations – Limited to Bail Proceedings – Not Affecting Merits of Complaint – The Court clarified that the observations made in granting bail were limited to the consideration of bail applications and should not influence the outcome of the underlying PMLA proceedings on their merits [Para 12].

Decision:

The appeals were allowed, and the appellants were directed to be produced before the Special Court for bail. The Special Court was instructed to set appropriate bail conditions after hearing the Enforcement Directorate. The Court specified that its observations were solely for bail purposes and would not affect the merits of the complaint.

Criminal Law – Cheating and Forgery – Quashing of Criminal Proceedings – The appellants, accused of cheating and forgery in a loan fraud involving forged mortgage documents submitted to a bank, sought to quash the proceedings after a settlement was reached – High Court dismissed the plea, citing that the offenses affected public interest, and could not be quashed due to a private settlement – Supreme Court quashed the proceedings, holding that the case was civil in nature with criminal facets and that a settlement had been reached, rendering further prosecution unjustified [Paras 1-39].

Loan Fraud – Role of Appellants – The appellants, wives of Accused Nos. 1 and 2, were involved only as co-guarantors in the loan and had no active role in the alleged forgery and conspiracy – The principal accused had settled the outstanding dues with the bank, closing the loan account – Continuation of criminal proceedings was held to be oppressive and futile given the settlement [Paras 5, 14, 36].

Private Settlement – Impact on Criminal Liability – Supreme Court noted that the offenses, although non-compoundable, predominantly bore a civil character arising from financial transactions – Following precedents, including Gian Singh and Nikhil Merchant, the Court held that private settlements in cases with civil overtones could lead to quashing of criminal charges when conviction seemed unlikely and continuation would be oppressive [Paras 17, 23, 29].

Decision: Appeal allowed – Criminal proceedings quashed – Appellants acquitted from all charges​.