Banking Law – Fraud Classification – Natural Justice – Personal/Oral Hearing – Whether Mandatory – RBI Master Directions 2016 and 2024 – Two borrower-companies' loan accounts classified as "fraud" by appellant-Banks after issuance of show cause notices, receipt of replies, and passing of reasoned orders – High Courts of Calcutta and Delhi, relying on State Bank of India v. Rajesh Agarwal, directed grant of personal hearing and supply of full Forensic Audit Reports before classifying accounts as fraud – Held: Rajesh Agarwal (supra) did not recognise any right in the borrower to a personal/oral hearing before classification of account as fraud – Procedure of issuing detailed show cause notice, furnishing evidentiary material, eliciting written representation, and passing a reasoned order fully satisfies the requirements of natural justice – Personal hearing is not an incident of natural justice in administrative proceedings except where expressly prescribed or in proceedings before courts of law – High Court orders directing personal hearing set aside [Paras 60–109].

RBI Master Directions 2024 – Clause 2.1.1.1 to 2.1.1.4 – Correct Understanding of Rajesh Agarwal – The RBI in its Master Directions of 15.07.2024 correctly understood the scope of Rajesh Agarwal (supra) – The Master Directions-2024 duly incorporated the procedure of detailed show cause notice, reasonable time for reply, examination of response, and passing of a reasoned order – This procedure strikes a fair balance between promptitude and fairness and duly comports with principles of natural justice – No right of personal hearing conferred on borrowers under the Master Directions-2024 either [Paras 100–103].

Natural Justice – Flexibility of Concept – Personal Hearing vs. Written Representation – Natural justice is a flexible concept, and as to which of its facets applies depends on the facts and circumstances, the framework of law, and the nature of the enquiry – Personal hearing is not a universal right of a noticee and its grant is ordinarily in the discretion of the authority – Oral hearing is bound to convert the swift internal administrative process of fraud classification into a protracted one, enabling recalcitrant borrowers to dissipate assets, destroy evidence, or abscond – Multiple directors seeking multiple personal hearings would throw banking operations into disarray and defeat the 180-day timeline under Master Directions – Classification of fraud account is, in broad sense, an internal housekeeping due diligence to trigger mandatory reporting, asset preservation, and risk mitigation [Paras 76–96].

Disclosure of Forensic Audit Report – Rule and Exceptions – Supply of forensic audit report to the borrower before classification of account as fraud is mandatory, not optional – Furnishing only the findings and conclusions of the forensic audit report does not satisfy the requirements of natural justice since reasons and context in the body of the report are integral to a complete understanding of the conclusions – The rule is full disclosure; the exception arises only where the bank, for recorded reasons, establishes that disclosure of any specific part would affect the privacy or rights of third parties, in which case only those portions may be withheld – Supply of report in digital form constitutes valid compliance – Banks must not unreasonably use the power of redaction [Paras 110–125].

Doctrine of Merger – Precedent – Scope of Rajesh Agarwal – The operative holding in Rajesh Agarwal (supra) is what the Supreme Court stated in its own judgment and not what the High Court of Telangana had directed in the judgment upheld on appeal – Under the doctrine of merger, it is the decree of the superior court that is the final operative decree – Rajesh Agarwal (supra) did not, throughout its ninety-eight paragraphs, use the expression "personal hearing" as part of the Court's own holding – Words "reply and representation" in Para 75 of Rajesh Agarwal (supra) did not contemplate two separate stages of written reply and oral hearing but referred only to written representation in reply to show cause notice – High Court judgments taking a contrary view overruled [Paras 104–109].

Statistics – Alarming Scale of Bank Frauds – RBI Annual Report 2024-25 discloses that total fraud cases in FY 2024-25 were 23,953 involving Rs. 36,014 crores; as on March 31, 2025, as many as 783 fraud classifications amounting to Rs. 1,12,911 crores were withdrawn by banks due to non-compliance with principles of natural justice as per Rajesh Agarwal (supra) – These statistics underscore the critical importance of an efficient, time-bound administrative fraud classification process [Para 23].

Decision: Civil Appeal Nos. 4243-4244 of 2026 partly allowed – Direction of Division Bench granting personal hearing to respondent-borrower set aside; direction to furnish forensic audit reports upheld – Fraud Identification Committee of appellant-Bank directed to furnish forensic audit reports, elicit fresh reply, and pass fresh orders in accordance with Master Directions-2024 – Civil Appeal No. 4245 of 2026 partly allowed – Direction granting personal hearing set aside; direction to furnish forensic audit reports upheld – Appellant-Bank directed to furnish reports, elicit representation, and pass fresh orders in accordance with Master Directions-2024 – No order as to costs.

Negotiable Instruments Act – Section 138 – Issuance of Process – Pre-Trial Stage – Legally Enforceable Debt – Statutory Presumption under Section 139 – Appellant's husband, through a mediator (second respondent), issued a cheque of ₹50 crores as security in an escrow arrangement under a settlement agreement – Cheque was dishonoured with remark "payment stopped by drawer" – Metropolitan Magistrate issued process under Section 138 upon finding prima facie ingredients satisfied – Sessions Court set aside the process holding that the cheque was not issued for a legally enforceable debt, as the underlying settlement agreement was not signed by the second respondent – Bombay High Court upheld the Sessions Court order – Held: At the stage of issuance of process, the only relevant considerations are issuance of cheque, its dishonour, service of statutory notice under Section 138, and filing of complaint within the prescribed period – Where the drawer does not dispute issuance of the cheque or his signature thereon, the statutory presumption under Section 139 is triggered and the burden shifts to the drawer to rebut it – This rebuttal can only occur during trial and not at the pre-trial stage – The Sessions Court erred in giving undue weightage to the unsigned settlement agreement and in ignoring the satisfied ingredients of Section 138 – Dismissal of complaint at pre-trial stage without affording the complainant an opportunity to lead evidence amounted to washing away the statutory presumption even before commencement of trial – Appeal allowed – Complaint restored for adjudication on merits [Paras 2, 6–11].

Negotiable Instruments Act – Section 139 – Statutory Presumption – Reverse Onus – Section 139 is a reverse onus clause enacted in furtherance of the legislative object of improving the credibility of negotiable instruments – The presumption includes existence of a legally enforceable debt or liability and is obligatory upon the Court to raise once the factual basis is established – The presumption stands activated when the drawer admits issuance of the cheque or the complainant proves issuance in his favour – Until the evidential burden is discharged by the accused during trial, the presumed fact must be taken as true – Disputed questions as regards existence of outstanding liability are questions of fact to be determined at trial on the basis of evidence [Paras 8–10].

Decision: Criminal Appeal allowed – Orders of the Sessions Court dated 30.12.2022 and the Bombay High Court set aside – Complaint CC1831/SC/2022 restored for adjudication on merits – Observations in the judgment not to be construed as an expression of opinion on the merits of the case.

Negotiable Instruments Act – Sections 138, 141 – Director's Liability – Quashing of Summoning Order – Appellant, a Director of the accused Company, summoned in connection with dishonoured cheques issued by the Company – Both the revisional court and the High Court held that her signing of Board Resolutions established involvement in day-to-day affairs – Held: Signing of a Board Resolution does not, by itself, establish that a Director was in charge of and responsible for the conduct of the day-to-day business of the Company – Complaint lacked even a whisper of direct allegation against the appellant to satisfy the sine qua non of Section 141 NI Act – Summoning order quashed [Paras 3–8].

Section 141 NI Act – Essential Averment – Merely being a Director of a Company is insufficient to attract liability under Section 141 NI Act – It is necessary to specifically aver in the complaint that the accused was, at the time of the offence, in charge of and responsible for the conduct of business of the Company – Absence of such averment is fatal to the complaint against a Director – Board Resolution signed by a Director relates only to major directional decisions of the Company and cannot be equated with knowledge of or participation in everyday business transactions [Paras 6–8].

Section 482 CrPC – Scope and Availability – Interplay with Section 397 CrPC – High Court erred in holding that once a petition under Section 397 CrPC has been entertained, a subsequent petition under Section 482 CrPC on the same grounds is circumscribed to a narrower jurisdiction and liable to be dismissed – Held: Inherent power of the High Court under Section 482 CrPC is not conferred by statute but is a paramount power of continuous superintendence that remains available even where revisional jurisdiction under Section 397 has been availed of – The two remedies are not mutually exclusive – Statement of law by the High Court on this point expressly set aside [Paras 9–11].

Decision: Appeal allowed – Summoning order against the appellant Saroj Pandey quashed and set aside – Observations limited to the appellant's case only and shall have no bearing on the trial of co-accused persons – Pending applications disposed of.

Criminal Law – Murder – Circumstantial Evidence – Acquittal – Appellant convicted under Section 302 IPC and sentenced to life imprisonment by the Trial Court; conviction affirmed by the High Court of Chhattisgarh – Prosecution case rested entirely on circumstantial evidence: alleged last-seen testimony of Raja Ram (PW-4), recovery of blood-stained axe and clothes pursuant to disclosure statements under Section 27 of the Evidence Act, recovery of appellant's driving licence from the spot, prior enmity, and motive – Co-accused Dwarika Jangde (accused No. 2) acquitted by Trial Court on the same evidence – Held: Each circumstance from which guilt is to be inferred must be firmly and fully established before conviction can be sustained; the prosecution's case fails at the threshold as no single incriminating circumstance is conclusively established – All five golden principles of circumstantial evidence as laid down in Sharad Birdhi Chand Sarda not satisfied – Appellant acquitted; bail bonds discharged [Paras 14, 31–32].

Criminal Law – Circumstantial Evidence – Five Golden Principles – Sharad Birdhi Chand Sarda – The circumstances from which the conclusion of guilt is drawn must be fully established; consistent only with the hypothesis of guilt; of a conclusive nature; must exclude every other hypothesis; and must form a complete chain leaving no reasonable ground for innocence – Suspicion, however strong, cannot take the place of proof – Where prosecution's case fails at the threshold itself and each incriminating circumstance is not firmly established, the accused is entitled to the benefit of doubt [Para 14, 31].

Criminal Law – Last-Seen Evidence – Reliability – Interested Witness – Raja Ram (PW-4) deposed that he saw the appellant near the deceased's house at about 10:00 p.m. carrying an axe – Identification made only in motorcycle headlight and house lights; witnesses confirmed there was no electricity supply in the deceased's house and the area was usually in darkness – Medical evidence did not fix the time of death with sufficient precision to conclusively correlate appellant's presence with commission of the offence – Raja Ram did not assert that he saw the appellant enter the house or commit any overt act – Furthermore, Raja Ram and members of his group harboured longstanding hostility towards the appellant, including a prior eve-teasing case, deposition against appellant in other proceedings, and departure of another associate from the village due to enmity with the appellant – Statement under Section 161 Cr.PC recorded only on 14.02.2011, a month after the incident, despite Raja Ram admitting he met the Police on the day of the incident itself – Held: Possibility of Raja Ram being an interested witness cannot be ruled out; his testimony without independent corroboration cannot sustain conviction [Paras 15–19].

Criminal Law – Recovery under Section 27, Evidence Act – Hostile Witnesses – Corroboration – Both Section 27 disclosure statements of the two accused were similar in language to the point of being verbatim in several portions – FSL report confirmed human blood on recovered axes and clothes but did not determine the blood group, did not conclusively match the hair to the deceased, and drew no definitive link between the recovered axes and the injuries – Witnesses to the Section 27 memorandums either turned hostile or denied any disclosure – Witnesses to seizure memos admitted signatures were not affixed contemporaneously at the place of recovery – Held: Recovery circumstance remains legally tenuous; cannot be relied upon to sustain conviction [Paras 20–25].

Criminal Law – Principle of Parity – Co-Accused Acquitted on Same Evidence – Where two accused are implicated on similar or identical evidence with the same or similar role ascribed to them, the Court cannot convict one and acquit the other; both cases must be governed by the principle of parity – Trial Court acquitted accused No. 2 (Dwarika Jangde) holding that human blood on seized articles was not linked to the deceased and that a single circumstance was insufficient – The same reasoning applies with equal force to the appellant – The only distinguishing factor was the last-seen testimony of Raja Ram, which does not inspire confidence – Held: Appellant deserves the benefit of doubt on the same reasoning [Paras 23–24].

Criminal Law – Motive – Limited Evidentiary Value – Prior enmity between appellant and deceased stemmed from an old incident where the appellant had to go to jail while the deceased secured bail for a co-accused – Evidence did not establish immediacy or gravity of the animosity; the two continued to be in contact and may have been consuming liquor together the previous evening – Held: Motive is a supporting factor which strengthens an otherwise complete chain of evidence; it cannot replace such a chain where other circumstances are missing or weak [Para 30].

Decision: Appeal allowed – Judgment dated 19.07.2017 of the High Court of Chhattisgarh in Criminal Appeal No. 677 of 2012 and judgment dated 28.07.2012 of the Sessions Judge, Rajnandgaon in Sessions Case No. 27 of 2011 set aside insofar as they relate to the appellant – Appellant acquitted of the charge under Section 302 IPC – Bail bonds discharged.

Public Interest Litigation — Public Procurement — CBI Investigation — Article 32 — Writ petition filed by a civil society organisation alleging systemic irregularities in the award of public works contracts in Arunachal Pradesh, including awards to firms stated to be connected with the Chief Minister (Respondent No. 4) and Respondent Nos. 5 and 6 — Repeated resort to non-tender methods, absence of recorded reasons for departing from competitive tendering, and non-production of vouchers and procurement records across multiple departments and schemes — CAG final report dated 21.07.2025 corroborating repeated gaps in documentary trail — State's defence based on aggregate low percentages of awards and geographical justification for work order system rejected — Held: Material discloses a sufficient prima facie foundation warranting entrustment of investigation to an independent agency — CBI directed to register preliminary enquiry and conduct time-bound investigation covering the period 01.01.2015 to 31.12.2025 — Writ petition disposed of with consequential directions [Paras 3–5, 29, 37, 42–44].

Constitutional Discipline in Public Procurement — Article 14 — State as Trustee of Public Resources — The State does not hold public resources as a private proprietor but as a trustee on behalf of the people — Award of public contracts is an exercise of public power subject to constitutional discipline of fairness, transparency, and non-arbitrariness — Competitive tendering is the ordinary and safest method of securing public interest — Departure from it permissible only on rational and recorded reasons — Appearance of public justice is as important as doing justice — Secrecy, discretion, and personal proximity are conditions in which abuse of power becomes difficult to detect — A constitutional violation in public contracting is not diluted by statistics; even a single instance, if established, undermines equality and public confidence [Paras 1, 2, 10–15].

Procurement Deviations and Missing Records — Legal Significance — Departure from competitive tendering must be supported by reasons recorded by the competent authority, capable of objective scrutiny — Non-production of core procurement records including tender documents, comparative statements, evaluation material, approvals, measurement records, and vouchers raises a distinct and serious concern — State as custodian of public records is expected to maintain them in traceable and accountable form — Court is not required to treat missing records as innocuous — A presumption against a party withholding evidence applies with greater force where the custodian is the State — Physical execution of a work does not answer constitutional questions regarding the procurement process [Paras 16–19].

CAG Report — Evidentiary Relevance — CAG final report dated 21.07.2025 filed pursuant to Court directions recorded multiple instances of execution of works without call of tender, repeated absence of recorded reasons for dispensing with tender, and non-production of vouchers for significant amounts including Rs. 107.11 lakhs, Rs. 23.20 lakhs, and Rs. 12.24 crores in NLCPR projects — In PMGSY projects, comparative statements and award documentation stated to be unavailable, disabling scrutiny — Corpus fund of Rs. 23 crores sanctioned to Bodhi Language and Literature Promotional Society found to have accrued interest transferred to savings account with utilisation unconfirmed due to lack of documentation — Held: CAG report has evidentiary relevance though not determinative of criminal culpability — Its findings provide prima facie foundation for independent investigation [Paras 23–25, 38, 40].

State's Defences — Rejected — (i) Submission that CAG report now lies within legislative domain and proceedings are rendered infructuous — Rejected: Legislative scrutiny through Public Accounts Committee does not displace constitutional role of the Court — (ii) Normalisation of work order system on basis of geographical and socio-economic conditions and Section 3A of the 2015 Act — Rejected: A statutory framework permitting limited dispensation with tender does not authorise unstructured discretion or repeated departures without a decision trail — (iii) Burden of proof shifted to petitioners to produce "explicit proof" — Rejected: State is the custodian of procurement records; at the prima facie stage the burden to answer gaps lies on the State — (iv) Aggregate percentage of awards to connected parties described as "minuscule" — Rejected: Constitution does not tolerate breach of public trust merely because numerically small; a low percentage cannot be a licence or a defence to nepotism [Paras 30–36].

Standard for Court-Directed CBI Investigation — The power under Articles 32 and 226 to direct CBI investigation is to be exercised sparingly, cautiously, and in exceptional situations — Transfer warranted where high officials of the State are involved, investigation by ordinary State machinery may not inspire confidence, or investigation is prima facie tainted or biased — Court at this stage does not adjudicate culpability but examines whether material discloses a prima facie case raising serious questions of legality, circumstances suggesting ordinary State machinery may not be impartial, and necessity of independent inquiry to preserve public confidence — SIT under State supervision rejected as inadequate given institutional proximity of persons against whom allegations are made — CBI held to be the appropriate agency [Paras 6–9, 37, 39, 41].

Decision: Writ petition disposed of — CBI directed to register preliminary enquiry within two weeks — Investigation to cover award and execution of public works contracts in Arunachal Pradesh for the period 01.01.2015 to 31.12.2025 — CBI to examine procurement process, reasons for dispensing with tender, availability and custody of records, beneficial ownership, fund flow, and cognizable offences, if any — CBI not precluded from examining transactions outside the above period for the limited purpose of tracing beneficial ownership, related-party links, or fund flows — State of Arunachal Pradesh directed to make available all relevant records within four weeks — Chief Secretary to designate nodal officer within one week — No record to be destroyed, altered, or rendered inaccessible — CBI to file status report within sixteen weeks — Observations not to be construed as findings on merits of any allegation — No order as to costs.

Industrial Lease — Cancellation — Breach of Lease Conditions — Failure to Raise Construction — Sub-clauses (e) and (o) of Clause 3 and Clause 5 of Lease Deed — Appellant-company's predecessor allotted industrial plot in 2001; formal lease deed executed on 19.03.2002 mandating construction within six months from date of possession — No construction raised by appellant over six to seven years beyond pre-existing structures of original allottee covering only 7.68% of plot area — Plot utilised merely for a testing facility within pre-existing constructions — Subsequent lease deed dated 10.07.2007 executed only to reflect change of name pursuant to amalgamation and did not alter or waive substantive covenants of original lease — Notices for breach issued in 2007 and 2008; appellant conceded inability to commence operations due to priority given to Baramati, Maharashtra facility — Lease cancelled on 25.08.2008 — High Court dismissed writ petition — Held: Appellant in clear and persistent breach of lease conditions; cancellation upheld; appeal dismissed [Paras 59–67, 79–80].

Lease Deed — Fresh Lease — Effect of Amalgamation — Appellant contended that execution of fresh lease deed dated 10.07.2007 rendered the original obligation to raise construction otiose as the six-month period had long since expired — Held: Fresh lease deed was executed merely to reflect change of name of lessee following court-sanctioned amalgamation — Permission for change of name granted by UPSIDA expressly subject to condition that all terms of allotment letter dated 16.05.1985, transfer letter dated 14.12.2001, and original lease deed dated 19.03.2002 shall remain unaltered — Fundamental covenants of original lease never modified, altered or extended — Submission that obligation was impliedly waived rejected [Paras 44, 65].

Extension of Time — Conditions Precedent — Estoppel — UPSIDA's letter dated 31.01.2008 required deposit of extension fee of Rs. 35,93,963.60 and submission of affidavit in prescribed format within thirty days as conditions for considering one-year extension — Prescribed format required undertaking to commence construction within three months and production within nine months, failing which cancellation to be automatic without right to dispute — Appellant's first affidavit dated 20.06.2008 consciously omitted mandatory conditions Nos. 1 and 2 of prescribed format — Extension fee deposited and conforming affidavit submitted only after cancellation order dated 25.08.2008 — Plea of estoppel rejected — Held: Conditions for consideration of extension were not fulfilled within stipulated period; UPSIDA not estopped from proceeding with cancellation — Deliberate omission of mandatory conditions from affidavit disentitles appellant from equitable relief [Paras 64, 67–72].

Industrial Area — Objectives — Obligations of Allottee — Primary purposes of establishment of industrial areas are generation of revenue, employment, and overall economic development — Allottees are granted large tracts at subsidised rates supported by infrastructural development — In turn, allottees are bound to strictly comply with time-bound schedules for project implementation — Keeping a major portion of industrial plot unutilised denies opportunity to other genuine entrepreneurs and defeats the very object of industrial allotment — Callous and laconic conduct in violation of applicable rules disentitles allottee to discretionary equitable relief [Paras 56–58, 73].

Electric Vehicle Policy — Restoration — Court's Jurisdiction — Appellant sought restoration of plot under Electric Vehicle Policy and urged that UPSIDA was allotting plots to genuine parties for e-vehicle manufacturing on walk-in basis — Held: No averment or material on record identifying persons or entities in whose favour such discretion has been exercised — Whether to grant industrial plot at concessional rate under any policy is absolutely within the domain of the State Government — Court in exercise of extraordinary jurisdiction under Article 136 would be loath to substitute its discretion for that of the State Government in commercial decisions — Plea rejected — UPSIDA also has no jurisdiction to restore a lease already validly cancelled [Paras 74–77].

Decision: Appeal dismissed — Impugned judgment of Allahabad High Court affirmed — Appellant directed to hand over vacant and peaceful possession of subject plot to UPSIDA within thirty days — Amount of Rs. 10,95,52,825 deposited by appellant in this Court to be refunded along with accrued interest — UPSIDA at liberty to deal with the plot as per law — Pending applications disposed of.

Criminal Law — Culpable Homicide — Common Intention — Section 304 Part II read with Section 34 IPC — Boundary dispute between close relatives — A-1 (Senthil) attacked with Aruval but blows fell on PW-4 (intervener), not the deceased — A-2 (Sivakumar) struck the deceased on the head with a log causing fatal skull fracture and brain haemorrhage — Trial Court convicted A-2 under Section 325 IPC and A-1 under Section 324 IPC — High Court altered A-2's conviction to Section 304 Part II IPC and convicted A-1 under Section 304 Part II read with Section 34 IPC — Supreme Court affirms A-2's conviction under Section 304 Part II IPC but sets aside A-1's conviction under Section 304 Part II read with Section 34 IPC for want of common intention — A-1's conviction under Section 324 IPC confirmed — Sentence of A-2 reduced from five years to three years rigorous imprisonment — Both appeals partly allowed [Paras 2–3, 21–22, 24, 27–28].

Section 294(b) IPC — Obscenity — Meaning of "Obscene" — Use of word "bastard" during heated altercation — Whether amounts to obscene words punishable under Section 294(b) IPC — Section 294 IPC requires utterance of obscene song, ballad, or words in or near a public place to the annoyance of others — "Obscenity" construed with reference to Section 292 IPC as material that is lascivious, appeals to prurient interest, or tends to deprave and corrupt — Vulgarity and profanities do not per se amount to obscenity — Words evoking disgust or revulsion are distinct from words arousing prurient interest — Held: Mere use of the word "bastard," commonly used in heated conversations in modern era, does not arouse prurient interest — Conviction of both appellants under Section 294(b) IPC set aside [Paras 17–20].

Common Intention — Section 34 IPC — Ingredients — A-1 charged with inflicting blow aimed at deceased but which fell on PW-4 — No evidence that A-1 exhorted A-2 to strike the deceased — Statement attributed to A-2 while lifting the log ("it is better that he dies") not attributed to A-1 — No reliable evidence that A-1 beat the deceased after he fell — Held: It would not be safe to hold that A-1 shared common intention with A-2 to cause such bodily harm as is likely to cause death — Conviction of A-1 under Section 304 Part II read with Section 34 IPC set aside [Para 21].

Culpable Homicide — Section 304 Part II IPC — Knowledge — Single blow with log on head — Skull fracture and brain haemorrhage — No improper treatment established as cause of death — A-2 uttered words targeting the deceased before inflicting blow — Held: High Court was justified in concluding that A-2 had knowledge that the act was likely to cause death — Conviction under Section 304 Part II IPC confirmed — Whether offence amounts to culpable homicide not amounting to murder punishable under Section 304 Part I not examined in absence of appeal by State or victim seeking enhancement [Paras 23–24].

Sentence — Reduction — Section 304 Part II IPC — Incident of 2014 — Preceded by altercation between neighbours who are close relatives — Boundary dispute — Injury caused by log lying at spot, not a dangerous weapon — Single blow inflicted in heat of moment — A-2 had served less than one year of sentence — Held: Ends of justice would be subserved by reducing sentence from five years to three years rigorous imprisonment — A-1's sentence altered to period already undergone [Paras 25–27].

Decision: Both appeals partly allowed — Conviction of A-1 (Senthil) and A-2 (Sivakumar) under Section 294(b) IPC set aside — Conviction of A-1 under Section 304 Part II read with Section 34 IPC set aside — Conviction of A-1 under Section 324 IPC confirmed; sentence reduced to period already undergone — Conviction of A-2 under Section 304 Part II IPC confirmed; sentence reduced from five years to three years rigorous imprisonment — A-1 on bail, need not surrender — A-2 directed to surrender before the concerned court to serve out remaining reduced sentence.

Criminal Law — Murder — Conviction — Acquittal — Circumstantial Evidence — Appellant, a constable in the Indian Reserve Battalion, convicted by the Trial Court under Section 302 IPC and Section 27 of the Arms Act for allegedly shooting his superior officer (Sub-Inspector Sunil Soren) with an INSAS rifle on 18.05.2014, motive being refusal of leave — Sentenced to life imprisonment and seven years respectively — High Court dismissed appeal affirming conviction — On further appeal, Supreme Court found that prosecution case rests entirely on circumstantial evidence — Chain of circumstances held to be incomplete — Conviction set aside — Appellant acquitted [Paras 1–2, 11, 13].

Witness Testimony — Reliability — Post-Occurrence Witness — Identification by Voice — PW-3 (hawaldar and informant), the sole witness claiming to have seen the appellant, stated in chief examination that he saw appellant coming from direction of deceased's room holding an INSAS rifle and that appellant confessed to the killing — However, in cross-examination, PW-3 admitted that it was dark, faces were not clearly visible, and that he identified the appellant only by his voice and not by visual recognition — Held: Admission materially undermines reliability of testimony; difficult to rely upon — PW-2 (constable) learned of the confession only through PW-3 and is therefore a hearsay witness — Both witnesses cannot form the basis of conviction [Paras 3–5, 8].

Circumstantial Evidence — Missing Link — Weapon of Offence — CW-3 testified that the seized rifle bearing butt no. 351 (the alleged weapon of offence) was his, and that it had been inadvertently exchanged with rifle bearing butt no. 329 (issued to appellant) about ten days prior to incident during guard duty — CW-1 (ballistic expert) testified that bullets recovered from deceased were fired from butt no. 351 — Exhibit X/5 (duty register for 12th–13th May 2014) showed appellant using butt no. 351 — However, duty register for 18th May 2014 (date of offence) not led in evidence — Held: Version of CW-3 regarding inadvertent exchange in a disciplined force remaining unnoticed for ten days is difficult to accept — In absence of duty register for the date of offence and other cogent evidence, conviction cannot be sustained on mere suspicion [Paras 6, 9].

Circumstantial Evidence — Standard of Proof — Every link in the chain of circumstantial evidence must be conclusively established — Even a single missing or weak link may prove fatal to the prosecution's case — Chain must point unerringly to guilt of accused to the exclusion of every other reasonable hypothesis — Where two views are reasonably possible on the same evidence, benefit of doubt must be extended to the accused — Held: Evidence falls short of the standard required in criminal law; does not exclude every reasonable hypothesis consistent with innocence of appellant — Evidence wholly insufficient to warrant conviction [Para 10].

Service Consequences — Reinstatement — Appellant in custody for nearly twelve years — Must have been dismissed from service consequent upon conviction — Held: Appellant granted liberty to seek reinstatement before appointing authority with consequential benefits, provided he is still mentally and physically capable of discharging duties — Appointing authority to take expeditious decision in accordance with law — If found incapable, appellant to be adequately financially compensated [Para 15].

Decision: Appeal allowed — Conviction and sentences under Section 302 IPC and Section 27 of the Arms Act set aside — Appellant acquitted — Directed to be released forthwith if not wanted in any other case — Liberty granted to seek reinstatement with consequential benefits — Pending applications disposed of.

Criminal Law — Quashing of Chargesheet — Section 482 CrPC — CCTV Footage — Parity among Co-accused — Appellants, residents of the same apartment complex as the complainant, arraigned in chargesheet under Sections 143, 341, 323, 324, 354, 504, 506, 509 and 427 IPC arising from a neighbourly altercation on 11.10.2022 — High Court quashed proceedings against two co-accused (wives of appellants) but declined similar relief to appellants — On appeal, Supreme Court viewed CCTV footage forming part of chargesheet and found appellants not visible at scene during acts of assault, their gestures demonstrative of restraint and efforts to pacify — Allegations in FIR vague and without specific attribution of overt acts to appellants — Statement under Section 164 CrPC containing omnibus allegations unsupported by corroborative material and belied by electronic evidence — High Court's differential treatment of similarly placed accused without cogent reasoning held unsustainable — Held: Case falls within categories (1), (3) and (7) of Bhajan Lal — Chargesheet quashed qua appellants — Appeals allowed [Paras 3–4, 24–31, 35–36].

Section 482 CrPC — Scope and Ambit — Inherent Jurisdiction — Seven categories enumerated in State of Haryana v. Bhajan Lal wherein High Court may exercise power to quash proceedings — Jurisdiction exercisable inter alia where allegations in FIR, taken at face value, do not prima facie constitute any offence; where uncontroverted allegations and material collected fail to disclose commission of offence; or where criminal proceeding is manifestly attended with malafide and instituted with ulterior motive for wreaking vengeance — Categories are illustrative and not exhaustive — Structured four-step test in Pradeep Kumar Kesarwani reiterated: material must be of sterling and impeccable quality; sufficient to negate allegations; unrefuted or incapable of justifiable refutation; and continuation must amount to abuse of process — Where all four steps are answered in affirmative, High Court ought to quash proceedings [Paras 22–23, 32].

CCTV Footage — Evidentiary Weight at Quashing Stage — Electronic evidence forming part of chargesheet viewed by Supreme Court at appellants' request — Footage demonstrated that alleged acts of assault had already occurred prior to appellants' arrival at scene — Appellants not shown engaging in any act of aggression — Visual record indicated appellants made efforts to pacify parties — Allegation that appellant No. 2 ignited a lighter to burn the complainant's family member found not discernible in footage — Held: CCTV footage, being of unimpeachable provenance and forming part of prosecution's own record, substantially dislodges the factual foundation of allegations against appellants — High Court's failure to meaningfully analyse this crucial piece of evidence renders impugned judgment unsustainable — Unimpeachable electronic evidence collected during investigation and relied upon by both sides cannot be brushed aside even at the stage of quashing [Paras 26–28, 33].

Parity — Co-accused — Differential Treatment — High Court quashed proceedings against Nabina Bose and Pampa Joardar (wives of appellants) on the basis of the same FIR and chargesheet arising from the same incident — No cogent or discernible reasoning assigned for declining similar relief to appellants despite substantially similar allegations — Held: Differential treatment without clear rationale violates principle of parity and renders impugned decision arbitrary and legally unsustainable [Para 29].

Abuse of Process — Malafide Prosecution — Pre-existing disputes between parties arising from co-residency in same apartment complex regarding maintenance charges and earlier complaints — Specific overt acts not attributed to appellants in FIR — Prosecution record bereft of credible material connecting appellants with alleged offences — Continuation of trial would not advance the cause of justice — Held: Proceedings manifestly attended with malafide initiated with ulterior motive — Compelling appellants to face full-fledged trial would amount to misuse of criminal process and wastage of precious judicial time [Paras 30–31, 34].

Decision: Appeals allowed — Impugned judgment and order dated 08.03.2024 of the High Court at Calcutta set aside — Chargesheet No. 135 of 2022 under Sections 143, 341, 323, 324, 504, 506, 509, 427 and 354 IPC arising out of FIR No. 150 of 2022 registered at Police Station Survey Park, pending in ACGR No. 4659 of 2022 before the Additional Chief Judicial Magistrate, South 24 Parganas at Alipore, quashed insofar as it relates to appellants Nos. 1, 2 and 3 — Pending applications disposed of.