Consumer Law - Forfeiture of Earnest Money – Validity of Contractual Clause – Consumer Protection – Earnest Money Deposit Justified – The appellant argued that NCDRC erred in interfering with a contractually agreed forfeiture clause allowing 20% of the Basic Sale Price (BSP) to be forfeited – The Court examined whether the forfeiture clause was reasonable or constituted an unfair contract – Held: Forfeiture of earnest money is justified only to a reasonable extent – The Court upheld the deduction of 10% of BSP but ruled that no interest was payable on the refunded amount [Paras 14-19, 39-40].

Unfair Contract – One-Sided Clauses in Builder-Buyer Agreements – Applicability of Consumer Protection Laws – The Supreme Court analyzed whether forfeiture provisions in real estate contracts disproportionately favor builders – It relied on prior judgments in Pioneer Urban Land and Infrastructure Ltd. v. Govindan Raghavan and Ireo Grace Realtech Pvt. Ltd. v. Abhishek Khanna, which held that builder-buyer agreements should not be one-sided – Held: Agreements allowing builders to impose disproportionate penalties while limiting their own liability are unfair and contrary to consumer protection principles – The Court found the contract’s forfeiture clause tilted in favor of the builder and justified NCDRC’s intervention [Paras 25-27, 30-32].

Interest on Refund – Buyer’s Cancellation Due to Market Conditions – No Interest Payable – The respondent sought a refund citing a decline in market prices, not a failure on the builder’s part – The Court noted that interest is usually awarded when a delay is caused by the builder – Held: Since the buyer voluntarily canceled the booking due to falling property prices, there was no justification for awarding interest on the refunded amount [Paras 41-43].

Section 74 of the Indian Contract Act – Penalty v. Reasonable Compensation in Real Estate Transactions – The Court revisited Maula Bux v. Union of India, distinguishing reasonable forfeiture from penal clauses – It reaffirmed that a developer may retain only a reasonable portion of the earnest money, beyond which forfeiture would constitute an unlawful penalty – Held: A 10% deduction as earnest money aligns with past judicial precedent, whereas 20% forfeiture would be excessive [Paras 37-39].

Decision: The appeal was partly allowed. The Court upheld the deduction of 10% of the BSP as earnest money but set aside the NCDRC’s award of interest. The appellant was directed to pay the balance refund amount within six weeks.

Right to Scribe and Compensatory Time – Extension of Benefits to Persons with Disabilities – Article 14 & RPwD Act, 2016 – The petitioner, diagnosed with Focal Hand Dystonia, sought facilities of a scribe and compensatory time in competitive examinations – The respondents restricted these benefits to only persons with benchmark disabilities (PwBD) – Held: Discriminating between PwD and PwBD for examination accommodations violates Article 14 and RPwD Act, 2016 – Examination authorities directed to extend all benefits given to PwBD candidates to PwD candidates as well [Paras 8-10, 19].

Duty of Examining Bodies – Uniformity in Providing Accommodations – Administrative Accountability – The Court noted multiple instances where exam-conducting bodies failed to provide reasonable accommodations due to lack of uniform implementation of government guidelines – Held: The Government of India must ensure strict adherence to its Office Memorandum dated 10.08.2022 across all recruitment agencies – Directions issued to re-notify guidelines incorporating penal action against non-compliance and establish a grievance redressal mechanism [Paras 17-19].

Reasonable Accommodation – Right Against Discrimination – Judicial Recognition of Inclusive Education – The Court reiterated that reasonable accommodation is a fundamental right under the RPwD Act – Relied on Vikash Kumar v. UPSC and Avni Prakash v. National Testing Agency to hold that exam bodies must proactively ensure accessible examination processes – Held: The refusal to provide accommodations due to the absence of benchmark disability status amounts to discrimination under the RPwD Act, 2016 [Paras 9-11].

Institute of Banking Personnel Selection (IBPS) – Amenability to Writ Jurisdiction – Fundamental Rights Enforceable Against Private Entities – The IBPS argued it was not a ‘State’ under Article 12 and not subject to writ jurisdiction – The Court rejected this contention, relying on Kaushal Kishor v. State of Uttar Pradesh, holding that fundamental rights under Articles 19 and 21 can be enforced against private entities discharging public functions – Held: IBPS must comply with RPwD Act, 2016 and government guidelines [Para 18].

Foreign Jurisprudence – International Recognition of Inclusive Education and Reasonable Accommodation – The Court examined foreign judgments such as Moore v. British Columbia (Canada), Mental Disability Advocacy Center v. Bulgaria, and GL v. Italy (ECHR) – Held: The right to education and examination accommodations for persons with disabilities is a recognized international obligation under the UNCRPD, which India is bound to implement [Paras 11-12].

Decision: The writ petition was allowed with directions. The Supreme Court directed the Government of India to amend its Office Memorandum dated 10.08.2022 within two months to:

• Remove the distinction between PwD and PwBD in examination accommodations.
• Establish a centralized grievance redressal mechanism.
• Implement strict penal action against authorities failing to comply with guidelines.
• Provide multiple examination modes for PwD candidates, including scribe, Braille, and large print options.

IBPS and all examining bodies were directed to comply with the revised guidelines immediately. The matter was directed to be listed after two months for compliance reporting.

Criminal Law - Quashing of Criminal Proceedings – False Allegations of Kidnapping and Rape – Marriage Between Accused and Victim Established – FIR Quashed - The appellant and the victim had married of their own free will, as evidenced by their joint petition for protection before the High Court – The victim later returned to her parental home and alleged rape and forced marriage – A Special Investigation Team (SIT) found that the allegations of kidnapping and coercion were unsubstantiated – Held: Since the marriage was consensual and Exception 2 to Section 375 IPC applies, the charge of rape cannot be sustained – FIR quashed [Paras 12-17].

Exception 2 to Section 375 IPC – Marital Relationship Precludes Rape Charge – No Prima Facie Case Made Out - The appellant, being the legally wedded husband of the victim, is protected under Exception 2 to Section 375 IPC, which excludes sexual intercourse between a husband and wife from the definition of rape – The victim’s written statement in the restitution of conjugal rights proceedings contained no allegations of rape – Held: Continuation of criminal proceedings would be an abuse of process of law – FIR and all consequential proceedings quashed [Paras 14-16].

Failure of Victim and Complainant to Contest Allegations – Absence of Prosecution Interest – No Purpose in Continuing Proceedings - Despite sufficient service of notice, neither the complainant (Respondent No. 2) nor the victim (Respondent No. 3) appeared before the Supreme Court to challenge the appellant’s claims – Their conduct indicates lack of interest in prosecuting the case – Held: In such circumstances, allowing the prosecution to continue would be unjustified [Para 15].

Power Under Section 482 CrPC – No Prima Facie Case – Invocation of Bhajan Lal Principles – Proceedings Quashed - The Supreme Court applied the principles laid down in State of Haryana v. Bhajan Lal to hold that the FIR and subsequent proceedings amounted to an abuse of the process of law – The allegations lacked prima facie merit, and no purpose would be served by continuing the criminal trial – Held: The appeal is allowed, the FIR and all consequential proceedings are quashed [Paras 16-18].

Decision of the Supreme Court – Appeal Allowed – FIR and Criminal Proceedings Quashed - The allegations against the appellant were found to be baseless – The FIR was registered under family pressure, and the victim’s initial protection petition affirmed the consensual nature of the marriage – Held: The appeal is allowed, the High Court’s order is set aside, and FIR No. 148 of 2022 along with all related proceedings is quashed [Paras 17-18].

Appeal against the High Court's dismissal of petitions under Section 482 CrPC seeking quashing of criminal proceedings under the SC-ST Act on the ground that the alleged offense did not occur in "public view."

Service Law - Regularization of Employment – Entitlement to Regular Pay-Scale – Circular Dated 10.05.1984 – Applicability to Special Recruitment Drive Employees - The Court held that the appellants, appointed under a Special Recruitment Drive on sanctioned posts, were entitled to the benefit of the regular pay-scale under Clause 6 of the circular dated 10.05.1984 – Their appointments were made by a duly constituted Selection Committee at the Collector's prescribed rate – Held: The Division Bench erred in denying the benefit of regular pay-scale, and the Single Judge’s order granting such benefits is restored [Paras 20-25].

Equal Treatment in Government Service – Parity with Ram Naresh Prajapati Case – Arbitrary Denial by State – Violation of Article 14 - The Supreme Court found that the appellants’ case was similar to Ram Naresh Prajapati v. State of M.P., where regular pay-scales were granted – The only distinction was the lack of scrutiny by a Screening Committee, which the State failed to constitute – Held: The denial of regular pay-scale on this basis is arbitrary and violative of Article 14 of the Constitution [Paras 26-30].

Application of Circular Dated 07.10.2016 – Regularization of Daily Wagers – Benefit Extended to Appellants - The Court noted that the 2016 circular extended regularization benefits to daily-wage employees working since 16.05.2007 – The appellants, having completed over ten years of service, were eligible under this circular as well – Held: Appellants entitled to benefit under both the 1984 and 2016 circulars [Paras 31-34].

Decision of the Supreme Court – Impugned Judgment Set Aside – Regular Pay-Scale Granted to Appellants - The Division Bench erred in distinguishing the present case from Ram Naresh Prajapati – The appellants fulfilled all eligibility criteria under the 1984 circular – Held: Appeals allowed, and the order of the Single Judge granting regular pay-scale restored [Paras 35-37].
 

Dowry Death – Essential Ingredients of Section 304-B IPC – Failure to Prove Cruelty or Harassment Soon Before Death – Conviction Set Aside - The Court reiterated that for a conviction under Section 304-B IPC, the prosecution must prove that (i) the death occurred under abnormal circumstances within seven years of marriage, (ii) soon before her death, the deceased was subjected to cruelty or harassment, and (iii) such cruelty or harassment was in connection with a demand for dowry – The evidence of prosecution witnesses contained significant omissions and contradictions – No direct proof of cruelty or harassment soon before the death – Held: Conviction under Section 304-B IPC unsustainable [Paras 18-22].

Cruelty Under Section 498-A IPC – Omission of Specific Incidents – Contradictions in Witness Statements – Conviction Not Sustainable - The prosecution relied on the testimony of PW-6 (mother of the deceased) and PW-7 (brother of the deceased), who alleged instances of dowry demands and mistreatment – However, several allegations were absent from their original police statements, making them material omissions – The evidence failed to establish any specific act of cruelty that could have driven the deceased to suicide – Held: Prosecution failed to prove the offense under Section 498-A IPC beyond a reasonable doubt [Paras 23-26].

Presumption Under Section 113-B of the Evidence Act – Applicability Contingent on Proof of Cruelty – Not Invoked in Absence of Substantiated Allegations - The Court emphasized that the presumption under Section 113-B of the Evidence Act applies only if the prosecution establishes that the deceased was subjected to cruelty or harassment soon before her death for dowry – In the present case, inconsistencies and contradictions in the statements of key witnesses rendered the allegations unreliable – Held: Section 113-B presumption not applicable as foundational facts were not established [Paras 27-30].

Judicial Approach to Dowry Death Cases – Need for Careful Evaluation of Evidence – Role of State Judicial Academies in Avoiding Convictions Based on Moral Assumptions - The Court observed that despite repeated pronouncements on the essential ingredients of Section 304-B IPC, trial courts continue to convict accused persons based on assumptions rather than strict legal proof – Emphasized the role of judicial academies in educating trial judges on correct legal principles – Held: Trial courts should exercise caution and adhere strictly to legal standards before convicting an accused under Section 304-B IPC [Paras 31-34].

Decision – Conviction and Sentence Set Aside – Appellant Acquitted - The Supreme Court held that the prosecution failed to prove the essential ingredients of Sections 304-B and 498-A IPC beyond a reasonable doubt – The trial court’s conviction was based on moral assumptions rather than legal proof – Held: Conviction set aside, appeal allowed, and the appellant acquitted [Paras 35-37].
 

Arbitration – Limitation of Liability Clause – Clause 49.5 of GCC – Bar on Claim for Damages – Enforceability Upheld – The contract contained a limitation of liability clause (Clause 49.5) that explicitly barred the contractor from claiming damages for employer-caused delays – Held: The appellant had repeatedly invoked Clause 49.5 to seek extensions of time without protest and had provided written undertakings not to claim damages beyond escalation – Having accepted the clause, the appellant was estopped from challenging its validity [Paras 12-19].

Contract Law – Public Policy – Section 23 and Section 28, Indian Contract Act – No Conflict – Appellant argued that Clause 49.5 was contrary to public policy as it prevented legitimate claims for employer-caused delays – Held: The appellant had not raised this argument before the Single Judge or Division Bench of the High Court – Moreover, limitation of liability clauses are recognized under Indian law and have been upheld in previous Supreme Court rulings – No interference warranted [Paras 24-26].

Arbitration – Waiver – Conduct of Parties – Appellant Estopped from Challenging Clause 49.5 – The appellant had explicitly undertaken not to make any claims beyond escalation in exchange for an extension of time – It could not later raise claims for damages after a two-year gap – Held: By its conduct, the appellant was estopped from challenging Clause 49.5 [Paras 19-20].

Arbitration – Scope of Judicial Review – Limited Interference under Section 37 – Delhi High Court Dismissal Upheld – Arbitral Tribunal rejected the claims summarily under Section 16(2) of the Arbitration Act – Appellant argued that it should have been allowed to lead evidence – Held: Since Clause 49.5 unambiguously barred such claims, the arbitral tribunal was correct in rejecting them at the threshold – High Court rightly applied the limited scope of judicial review under Section 34 and Section 37 – No grounds for interference [Paras 27-29].

Decision – Appeal Dismissed – Supreme Court upheld the arbitral award and the Delhi High Court’s judgment – No merit in the appeal – Dismissed with no costs [Para 29].

Matrimonial Law - Divorce – Mental Cruelty – False Allegations Against Spouse – Character Assassination – Divorce Decree Upheld - The respondent-husband sought divorce on the grounds of cruelty and desertion – The Family Court found that the wife made false allegations of fraud, dowry demand, and harassment against the husband – Additionally, during cross-examination, she accused the husband of an illicit relationship without specific pleadings – The High Court upheld the decree, holding that making such unfounded allegations constitutes mental cruelty – Held: Divorce decree affirmed as the marriage had irretrievably broken down and parties had no intention of resuming cohabitation [Paras 7-15].

Permanent Alimony – Assessment of Husband’s Financial Capacity – Failure to Disclose True Income – Award of Lump Sum Settlement - The appellant-wife sought permanent alimony, alleging that the husband had multiple sources of income – The respondent-husband claimed to be a daily-wage earner, but affidavits and evidence suggested otherwise – The Court found discrepancies in the husband's disclosure and inferred a higher earning capacity – Held: A one-time settlement of Rs. 10,00,000/- (Rupees Ten Lakhs) awarded to the appellant-wife, covering all pending and future claims [Paras 16-20].

Irretrievable Breakdown of Marriage – Prior Marital Litigation – Husband’s Subsequent Remarriage – No Interference in Divorce Decree - The Supreme Court noted that the respondent-husband had remarried in 2019, and both parties had no intention of resuming their relationship – The mediation process failed, and the appellant ultimately agreed to divorce while seeking financial compensation – Held: No interference warranted with the divorce decree granted by the Family Court and upheld by the High Court [Paras 15-17].

Decision of the Supreme Court – Divorce Upheld – One-Time Alimony Granted – Appeal Partially Allowed - The Supreme Court upheld the Family Court and High Court’s decision granting divorce – However, considering the husband’s financial status and earning capacity, the Court awarded a lump sum settlement of Rs. 10,00,000/- as permanent alimony – Held: Appeal partially allowed, divorce decree maintained, respondent directed to pay permanent alimony within three months [Paras 20-22].

Quashing of Criminal Proceedings – Section 482 CrPC – Summoning Order Lacks Reasons – The appellants were charged with manufacturing and distributing a drug declared as ‘Not of Standard Quality’ – The trial court issued summons without assigning reasons – The Supreme Court reiterated that a summoning order must reflect application of judicial mind and must not be a mere formality – Held: The summoning order was non-speaking and unsustainable – Proceedings quashed [Paras 6-9].

Bar of Limitation – Section 468(2) CrPC – Complaint Filed Beyond Prescribed Period – The alleged offence was based on an Analytical Report dated 15th December 2018 – The complaint was filed in May 2023, well beyond the three-year limitation period – Held: The prosecution was barred by limitation under Section 468(2) CrPC and thus untenable [Para 5].

Judicial Precedent – Summoning Must Reflect Judicial Application – The Court reiterated that summoning an accused in a criminal case is a serious matter and the magistrate must apply his mind – A non-speaking order violates fundamental legal principles – Reference made to the Court’s previous rulings in Pepsi Foods Ltd., Sunil Bharti Mittal, Mehmood Ul Rehman, and Krishna Lal Chawla [Paras 8-9].

Decision – Appeal Allowed – Proceedings Quashed – The Supreme Court allowed the appeal, set aside the High Court’s order, and quashed the criminal proceedings against the appellants [Para 10].