IBC – Section 7 – Admission of CIRP – Debt and Default – Mandatory Admission – Financial creditor sought initiation of CIRP against real estate developer – NCLT dismissed petition holding IBC was invoked as recovery mechanism and project was viable – NCLAT reversed and admitted CIRP – Held: Once existence of financial debt and occurrence of default are established, admission under Section 7 is mandatory – Considerations of project viability, stage of completion, receivables, or prejudice to homebuyers are extraneous at admission stage [Paras 12.1–12.7, 12.21–12.22].

Section 7(5)(a) IBC – Discretion – Limited Scope – Vidarbha Industries Exception – Corporate debtor relied on Vidarbha Industries to contend discretionary power to refuse admission – Supreme Court reiterated that Vidarbha Industries is a narrow exception confined to peculiar facts involving adjudicated and realisable counter-claims – Innoventive Industries and E.S. Krishnamurthy reaffirmed as governing law – Held: No discretion survives once debt and default are proved except in rare Vidarbha-type situations [Paras 12.5–12.7].

IBC Not a Recovery Tool – Parallel Proceedings under SARFAESI and DRT – Allegation of misuse of IBC by financial creditor pursuing SARFAESI and DRT remedies – Held: Pendency or initiation of recovery proceedings does not bar invocation of Section 7 – Overriding effect of Section 238 IBC – Allegations of mala fides must be specifically pleaded and proved under Section 65 [Paras 12.11–12.15].

Restructuring / OTS – Default – Effect – Corporate debtor entered restructuring-cum-OTS and defaulted in instalment payments – Revocation of restructuring by financial creditor held contractually justified – Subsequent alleged non-cooperation by creditor cannot erase admitted default – Held: Failure to honour instalments constitutes valid trigger for CIRP [Paras 12.9–12.10, 12.19].

Commercial Wisdom – Committee of Creditors – Non-justiciability – Issues of feasibility, viability, revival, liquidation or project completion fall exclusively within domain of CoC – Courts cannot examine such issues at Section 7 admission stage – Held: Judicial review is limited and commercial wisdom of CoC is non-justiciable except on statutory grounds [Paras 12.16–12.17].

Real Estate Insolvency – Homebuyers’ Interests – Statutory Safeguards – Court acknowledged vulnerability of homebuyers when projects enter CIRP – However, IBC framework provides safeguards through authorised representatives, Regulation 4E and exclusion of possessed units from liquidation estate – Held: Protection of homebuyers must operate strictly within the IBC framework and cannot dilute statutory trigger of insolvency [Paras 10–10.5, 13.21].

Proceedings under Section 7 – Nature – In Personam at Pre-admission Stage – Supreme Court reiterated that proceedings under Section 7 remain in personam until admission – Only financial creditor and corporate debtor have right of audience at pre-admission stage – Other creditors or third parties have no independent right to intervene [Paras 13.5, 13.11].

Intervention – Locus Standi – Housing Society – Co-operative housing society sought intervention claiming to represent homebuyers – Society neither financial creditor nor operational creditor – No privity of contract or statutory recognition as authorised representative – Held: Society lacks locus standi to intervene at Section 7 stage or in appeal against admission [Paras 13.1–13.5, 13.7–13.13].

Homebuyers as Financial Creditors – Mode of Participation – Individual allottees recognised as financial creditors under Section 5(8)(f) – Participation statutorily channelised through authorised representatives under Section 21(6A) read with Regulation 16A – Collective representation outside statutory framework impermissible [Paras 13.12–13.14].

Rule 11 NCLAT Rules – Inherent Powers – Limits – Inherent powers cannot override statutory scheme of IBC or create substantive participatory rights – Held: Rule 11 cannot be invoked to permit intervention where statute consciously excludes such participation [Paras 13.15–13.16].

Natural Justice – Audi Alteram Partem – No Vested Right – Denial of hearing to non-stakeholder does not violate natural justice absent legally vested right – Held: No prejudice shown as homebuyers’ interests are adequately safeguarded post-admission under IBC [Paras 13.19–13.21].

Directions to CoC – Transparency and Accountability – Supreme Court issued prospective directions requiring disclosure of complete allottee details in Information Memorandum – Mandatory recording of reasons where CoC declines handover of possession under Regulation 4E or recommends liquidation – Objective: transparency, accountability and protection of homebuyers [Para 15.1].

Decision: Civil Appeals dismissed – Judgment of NCLAT admitting Corporate Debtor into CIRP upheld – Rejection of intervention application by housing society affirmed – Interim stay vacated – Directions issued to Committee of Creditors regarding transparency and reasoned decision-making – No order as to costs.

Taxation Law - International Taxation – Double Taxation Avoidance Agreement (DTAA) – India-Mauritius DTAA – Capital Gains – Indirect Transfers – Tax Avoidance – GAAR – TRC Conclusiveness – The Supreme Court held that capital gains arising from the transfer of unlisted equity shares, which were part of an impermissible arrangement under law, are not entitled to exemption under Article 13(4) of the India-Mauritius DTAA – The Revenue successfully demonstrated that the transactions constituted impermissible tax-avoidance arrangements, lacking commercial substance and not qualifying as lawful – Consequently, Chapter X-A (GAAR) of the Income Tax Act, 1961, is applicable – The AAR's rejection of the applications for advance ruling on the ground of prima facie tax avoidance, as per proviso (iii) to Section 245R(2) of the Act, was upheld – The Court found that capital gains from transfers effected after the cut-off date of April 1, 2017, are taxable in India under the Income Tax Act read with the DTAA – The High Court's judgment setting aside the AAR's order was reversed – The Court emphasized that post-amendment, a TRC alone is not sufficient to avail DTAA benefits, and the tax authorities are empowered to investigate the real residence and management of entities to prevent treaty abuse – The transaction involved the sale of shares of a Singapore company deriving substantial value from Indian assets, by Mauritius-based entities controlled by an American company, which the AAR deemed a preordained arrangement for tax avoidance – The Court reiterated that while tax planning is permissible, it must conform to legal parameters and not be a sham or impermissible avoidance – The burden of proof to rebut the presumption of tax avoidance lies with the taxpayer [Paras 11, 18, 19, 28, 29, 33, 36, 37, 41, 46, 49, 50].

Income Tax Act, 1961 – Section 245R(2) – Authority for Advance Rulings (AAR) – Jurisdiction – Prima Facie Tax Avoidance – The Supreme Court clarified that the AAR is empowered to reject applications for advance rulings at the threshold if the transaction appears prima facie designed for tax avoidance – The term "prima facie" in Section 245R(2) implies that an initial examination of documents, satisfying the AAR that the transaction is for tax avoidance, is sufficient to reject the application – The burden of proof lies with the applicant to demonstrate otherwise – The High Court erred in adjudicating the issue on merits when the AAR had only made a prima facie finding of tax avoidance [Paras 11, 32, 33, 34].

Income Tax Act, 1961 – Section 9(1)(i) – Indirect Transfers – Source-Based Taxation – Explanations 4 & 5 – The Supreme Court affirmed that the retrospective amendments to Section 9(1)(i) of the Income Tax Act, 1961, through Explanations 4 and 5 (introduced by the Finance Act, 2012), codify the "look-through" principle – These amendments clarify that gains from the transfer of shares or interests in a foreign entity deriving substantial value from assets located in India are taxable in India, thereby establishing India as the source State for such income – This expanded scope of Section 9 ensures source-based taxation, irrespective of the entity's residence, where the economic nexus of income exists in India [Paras 7.4, 12.13, 12.14, 12.15, 28].

Income Tax Act, 1961 – Chapter XA – General Anti-Avoidance Rule (GAAR) – Applicability – Grandfathering Provisions – Rule 10U – The Supreme Court held that GAAR provisions under Chapter XA of the Income Tax Act, 1961, are applicable to the assessment year under consideration (AY 2019-20) – The Court clarified that while Rule 10U(1)(d) provides for grandfathering of investments made before April 1, 2017, Rule 10U(2) dilutes this by stating that GAAR applies to "any arrangement" irrespective of its entry date, if a tax benefit is obtained from such arrangement on or after April 1, 2017 – This means that even pre-2017 investments are subject to GAAR scrutiny if they form part of an impermissible avoidance arrangement yielding a tax benefit exceeding Rs. 3 crores after the cut-off date – The Court rejected the argument that all pre-2017 investments are immune from GAAR, emphasizing that GAAR targets abusive arrangements, not genuine investments [Paras 7.16, 7.17, 7.18, 7.19, 7.20, 7.21, 12.16, 12.17, 12.18, 12.28, 12.29, 12.30, 12.35, 46, 47].

Income Tax Act, 1961 – Section 90(4) & 90(5) – Tax Residency Certificate (TRC) – Evidentiary Value – Treaty Benefits – The Supreme Court ruled that post-amendment, a TRC issued by Mauritian authorities is an "eligibility condition" but not "sufficient evidence" for claiming DTAA benefits – The amendments to Section 90(4) and the insertion of Section 90(5) (Finance Act, 2012 and 2013) empower Indian tax authorities to seek additional documents and information, and to investigate the actual residence and management of entities – This position supersedes earlier CBDT Circulars (No. 789 and 682) that treated TRCs as conclusive proof of residence and beneficial ownership – The Court emphasized that the TRC is not binding on statutory authorities or courts without independent verification, especially in cases of fraudulent or fictitious transactions [Paras 7.5, 7.8, 7.10, 7.13, 7.25, 7.26, 7.27, 8.3, 8.4, 8.10, 8.17, 8.19, 8.21, 12.20, 12.21, 12.22, 12.23, 12.26, 36, 37, 44].

International Taxation – Treaty Interpretation – Substance Over Form – Judicial Anti-Avoidance Rules (JAAR) – The Supreme Court reiterated the principle of "substance over form" and the applicability of Judicial Anti-Avoidance Rules (JAAR) in Indian tax jurisprudence – It held that even if GAAR is inapplicable, JAAR can be invoked to deny treaty benefits in cases of treaty abuse or conduit structures lacking genuine commercial substance – The Court emphasized that the Revenue has the burden to establish abuse, but once established, the real transaction can be subjected to tax, disregarding interposed devices – The "look at" test, as enunciated in Ramsay and Vodafone, requires examining the entire transaction holistically to ascertain its true legal nature and dominant purpose, rather than adopting a dissecting approach [Paras 6.8, 6.15, 6.18, 7.5, 7.6, 7.8, 7.13, 7.24, 7.25, 8.6, 8.11, 8.12, 13.1, 60, 61, 63, 64, 65, 68, 69, 70, 71, 72, 73, 74, 75, 76, 77, 79, 80, 81, 82, 96, 97, 98, 99, 100, 101, 102, 103, 130, 131].

DTAA Amendment – Protocol of 2016 – Article 13(3A), 13(3B), 13(4), 27A – Grandfathering – The Supreme Court noted that the 2016 Protocol to the India-Mauritius DTAA introduced Articles 13(3A) and 13(3B), vesting source-based taxation rights for capital gains from shares acquired on or after April 1, 2017 – Existing investments made before this date were grandfathered – However, Article 13(4), a residuary provision, continues to allocate taxing rights to the residence State for properties not covered by other paragraphs – The LOB clause (Article 27A) was introduced to deny benefits to shell/conduit companies, defining them based on negligible business operations or low expenditure – The Court clarified that the grandfathering under the DTAA applies to direct transfers of shares of an Indian company, but indirect transfers of shares of a foreign company deriving value from Indian assets, especially if part of a tax avoidance arrangement, are not automatically exempt [Paras 6.6, 6.7, 6.9, 6.18, 7.14, 7.15, 8.7, 8.15, 8.16, 12.31, 12.32, 12.33, 12.34, 41, 45].

Tax Sovereignty – International Treaties – Policy Considerations – Justice J.B. Pardiwala, in a concurring opinion, emphasized the paramount importance of a nation's tax sovereignty in the global economic landscape – He highlighted that while international treaties are crucial for economic growth and cooperation, they should not compromise a nation's inherent right to tax income arising within its territory – The exercise of tax sovereignty requires a balance between domestic priorities and international obligations, with a focus on preventing tax evasion, money laundering, and other illicit financial activities – Treaties should include safeguards like Limitation of Benefits (LOB) clauses, GAAR override provisions, source-based taxation rights, tax credit methods (over exemptions), and exit/renegotiation clauses to protect national interests and adapt to evolving global trade dynamics – The Court stressed that India must assert its right to tax profits generated from its soil and avoid self-defeating compromises of its sovereignty [Paras 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 135, 136, 137, 138, 139, 140, 141, 142, 143, 144, 145, 146, 147, 148, 149, 150, 151].

Decision: Appeal allowed – Impugned judgment of the High Court set aside – Paras [51].

Constitutional Law – Validity of Legislation – Section 17A, Prevention of Corruption Act, 1988 – Upheld (with interpretation) – The Court examined the constitutional validity of Section 17A of the Prevention of Corruption Act, 1988, which mandates prior approval for inquiry or investigation into offences committed by public servants in discharge of official functions or duties – The provision aims to protect honest public servants from frivolous complaints and policy paralysis – The Court noted that Section 17A, unlike its predecessors (Single Directive 4.7(3) and Section 6A of DSPE Act), applies across the board to all public servants and includes time limits for approval decisions – It was contended that Section 17A is a salutary provision with checks and balances to prevent harassment of honest public servants – The Court held that the object behind Section 17A to provide previous approval for inquiry/investigation into offences relatable to recommendations or decisions taken by public servants in discharge of official duties cannot be faulted – The Court emphasized the need to balance protecting public servants from mala fide prosecution and upholding probity in public life – The Court also referred to the United Nations Convention Against Corruption, which advocates for an appropriate balance between immunities for public officials and effective investigation – The Court concluded that Section 17A is constitutionally valid, subject to the condition that the grant or refusal of approval by the competent authority will depend on the recommendation of the Lokpal/Lokayukta – This interpretation ensures an independent screening mechanism, aligning Section 17A with the principles laid down in Vineet Narain and Subramanian Swamy – This mechanism addresses concerns about potential abuse and lack of objectivity if the government itself were the sole screening authority – The Court rejected the argument that judicial review alone is sufficient to check misuse of power, as judicial review primarily focuses on the decision-making process, not the merits of the decision itself – The Court also rejected the analogy with the judiciary's screening mechanism as not tenable due to the distinct nature of judicial functioning – The Court disposed of the writ petition with directions to ensure the involvement of Lokpal/Lokayukta in the approval process [Paras 45, 53, 58, 59, 81, 87, 88, 89, 96, 99, 100, 101, 102, 104, 105, 106, 107, 108, 111, 115, 116, 119, 120, 122, 124].

Constitutional Law – Interpretation of Statutes – Reading Down – Section 17A, Prevention of Corruption Act, 1988 – Applied – The Court applied the principle of "reading down" to Section 17A to save it from being rendered unconstitutional – The Court noted that where there are two possible interpretations, one invalidating the law and the other upholding it, the latter should be adopted – This approach aims to salvage legislation to achieve its objective without infringing the Constitution – The Court held that Section 17A can be aligned with the pronouncements in Vineet Narain and Subramanian Swamy by ensuring a screening mechanism by an independent agency before the grant or refusal of approval by the government, and that the recommendations of this independent agency are binding on the government – This ensures the salutary provision in preventing frivolous complaints against honest public servants is not set at naught – The Court emphasized that this interpretation does not amount to "substitution" or "judicial legislation" but rather ensures safeguards for its implementation and attracts talent to public service [Paras 97, 98, 99, 100, 111, 114, 122, 123, 124].

Criminal Law – Corruption – Investigation – Prior Approval – Role of Lokpal/Lokayukta – The Court directed that the Union of India or State Governments and the authorities competent to remove public servants, upon receiving information under Section 17A, shall immediately forward it to the Lokpal/Lokayukta (in case of States) – The Lokpal/Lokayukta shall then conduct an inquiry on the information in accordance with their respective statutes and forward a recommendation to the appropriate authority – This authority shall be bound by and act in accordance with the Lokpal/Lokayukta's recommendation regarding the grant or refusal of permission under Section 17A – For bodies/organizations/public servants not covered under the Lokpal's jurisdiction, the competent authority to remove the public servant shall commission an appropriate independent investigative agency to screen the information and act on its recommendation – The time-limit stipulated in the proviso to Section 17A (three months, extendable by one month) shall apply, and all authorities must adhere to it – The Lokpal/Lokayukta must provide reasons for their recommendations [Paras 124(i), 124(ii), 124(iii), 124(iv), 124(v)].

Dissenting Opinion – Constitutional Validity of Section 17A, Prevention of Corruption Act, 1988 – Unconstitutional – Justice B.V. Nagarathna, in a separate opinion, held that Section 17A of the Prevention of Corruption Act, 1988, is unconstitutional and ought to be struck down – The dissenting opinion argued that Section 17A is contrary to the objects of the Act and is an attempt to reintroduce provisions (Single Directive 4.7(3) and Section 6A of DSPE Act) previously struck down by the Supreme Court in Vineet Narain and Subramanian Swamy – It was contended that the requirement of prior approval forestalls inquiry and protects the corrupt, rather than the honest – The dissenting opinion found the substitution of "Government" with "Lokpal" or "Lokayukta" impermissible by way of interpretation, as it amounts to judicial legislation – It highlighted that the provision is arbitrary due to "policy bias," potential conflict of interest within government departments, and the difficulty in identifying a single public servant responsible for decisions – The dissenting opinion emphasized that the classification of public servants based on their decision-making duties, effectively protecting higher-level officers, violates Article 14 of the Constitution – It concluded that Section 17A, in substance, is a resurrection of Section 6A and continues to suffer from the infirmities identified in Subramanian Swamy, including impeding independent investigation and forewarning potential culprits – The dissenting opinion stressed that the overarching object of the Act is to prevent corruption, and Section 17A undermines this purpose by creating a shield for dishonest public servants [Paras (i), (ii), (iii), (iv), (v), (vi), 19.1, 20.1, 20.3, 20.5, 20.6, 20.7, 20.8, 20.9, 20.10, 20.11, 20.12, 20.13, 20.14, 20.15, 21, 21.1, 21.2, 21.3, 21.4, 22(i), 22(ii), 22(iii), 22(iv), 22(v), 22(vi)].

Decision: Appeal allowed – The writ petition is disposed of with directions to ensure the involvement of Lokpal/Lokayukta in the approval process under Section 17A of the Prevention of Corruption Act, 1988. The matter is referred to the Chief Justice of India for constituting an appropriate Bench to consider the issues afresh due to divergent opinions.

Hindu Law – Maintenance of Dependants – Widowed Daughter-in-Law – Section 21(vii), Hindu Adoptions and Maintenance Act, 1956 – Respondent became widow after the death of her father-in-law – Family Court dismissed maintenance petition as not maintainable – High Court reversed and held petition maintainable – Supreme Court affirmed – Held: Expression “any widow of his son” includes every widow of a son irrespective of the time when widowhood occurs – Timing of son’s death is immaterial [Paras 7, 10–16, 22, 29].

Statutory Interpretation – Literal Rule – Clear and unambiguous language – Courts cannot add or subtract words from statute – Legislature deliberately used words “any widow of his son” and not “widow of predeceased son” – Judicial re-writing of statute impermissible even if hardship alleged [Paras 16–22].

Maintenance – Liability of Heirs – Section 22, Hindu Adoptions and Maintenance Act, 1956 – Obligation of all heirs inheriting estate of deceased Hindu to maintain dependants – Dependant who does not inherit any share entitled to maintenance from those taking the estate [Paras 12–13].

Constitution of India – Article 14 – Arbitrary Classification – Distinction between widowed daughters-in-law based on whether husband died before or after father-in-law held unreasonable – Such classification has no nexus with object of the Act and violates equality before law [Para 23].

Right to Life – Article 21 – Maintenance as component of right to live with dignity – Denial of maintenance to widowed daughter-in-law would lead to destitution and social marginalisation – Provisions of Act must be interpreted in harmony with constitutional values and social justice [Para 24].

Hindu Law Principles – Moral and Legal Obligation – Duty to maintain female dependants – Reference to Manu Smriti – Pious obligation of family head to support widowed daughter-in-law reaffirmed – Codified law does not negate fundamental Hindu law principles consistent with statute [Paras 25–26].

Sections 19 and 22 – Distinction – Section 19 governs maintenance during lifetime of father-in-law – Section 22 applies after death of father-in-law and enables claim against his estate – Widowed daughter-in-law entitled to maintenance as dependant after death of father-in-law [Paras 27–28].

Decision: Appeals dismissed – Judgment of High Court upheld – Maintenance petition held maintainable – Family Court directed to decide claim on merits – No order as to costs.

Service Law - Public Employment – Persons with Disabilities – Denial of Appointment – Appellant applied under Visually Handicapped category pursuant to 2019 recruitment by Coal India Limited – Declared medically unfit on ground of multiple disabilities – Single Judge quashed medical unfitness and granted relief for subsequent recruitment – Division Bench reversed on ground of expiry of panel – Supreme Court set aside Division Bench order – Held: Expiry of panel cannot defeat substantive rights where initial denial was illegal and not attributable to candidate [Paras 1–3, 8].

Disability Law – Benchmark Disability – Medical Assessment by Expert Body – AIIMS Medical Board constituted pursuant to Supreme Court directions – Board assessed appellant at 57% disability, exceeding benchmark of 40% – Appellant held eligible for appointment under reserved quota for persons with disabilities [Paras 4–7, 9, 12].

Reasonable Accommodation – Concept and Scope – Reasonable accommodation recognised as a fundamental right and gateway right – Rooted in RPwD Act and Articles 14, 21 and 41 of the Constitution – Not limited to assistive devices but includes flexible, purposive interpretation of rules and conditions of employment – Denial amounts to discrimination and violates substantive equality [Paras 13–17].

Employment Rights – Right to Work – Constitutional Perspective – Right to livelihood integral to right to life with dignity – Directive Principles under Articles 39(a) and 41 to inform interpretation of fundamental rights – Public sector undertakings obligated to respect and promote disability rights [Paras 18–22].

Intersectionality – Disability and Gender – Appellant a single woman facing compounded discrimination – Technical objections such as expiry of panel cannot override need to do complete justice – Substantive equality requires recognition of multiple and intersecting axes of disadvantage [Paras 23–24].

Corporate Social Responsibility – Disability Inclusion – Public sector employer’s obligation to respect human rights of persons with disabilities – Disability inclusion integral to ESG framework and CSR obligations – Equality at workplace requires proactive accommodation and inclusion [Paras 25–28].

Relief – Creation of Supernumerary Post – Supreme Court directed creation of supernumerary post for appellant – Direction to provide suitable desk job with universal design accommodations – Posting directed at North Eastern Coalfields, Assam – Relief granted in exercise of powers under Article 142 of the Constitution [Paras 30–34].

Decision: Appeal allowed – Order of Division Bench of Calcutta High Court set aside – Appellant directed to be appointed by creation of supernumerary post with reasonable accommodation – Appeal disposed of accordingly.

Right to Education – Section 12(1)(c), RTE Act, 2009 – Admission of children from weaker sections and disadvantaged groups – Neighbourhood schools under statutory obligation to admit at least 25% of entry-level class strength – Provision held to be transformative and central to achieving constitutional equality of status – Effective implementation declared a national mission [Paras 1, 7–10].

Fundamental Right – Article 21A – Nature and Scope – Right to free and compulsory elementary education recognised as a positive fundamental right – Identification of five duty bearers: appropriate government, local authority, neighbourhood school, parents/guardians and teachers – Co-relative duties essential for realisation of constitutional mandate [Paras 5–6.5].

Judicial Review – Denial of Admission – High Court dismissed writ petition blaming parent for failure to follow online procedure – Supreme Court held such approach unsustainable in face of administrative directions, RTI disclosures of vacant seats and poverty of petitioner – Courts duty-bound to provide effective relief in cases of denial of fundamental right to education [Paras 2–3].

Access to Justice – Procedural Barriers – Digital illiteracy, language barriers, lack of transparency, absence of help-desks and grievance redressal mechanisms found to obstruct access to Section 12 benefit – Online-only admission processes held exclusionary for vulnerable groups [Paras 3–4].

Constitutional Values – Equality, Dignity and Fraternity – Section 12(1)(c) designed to integrate children from diverse socio-economic backgrounds in common neighbourhood schools – Provision furthers substantive equality, social integration and fraternity – Common School System endorsed as constitutional strategy to dismantle class and caste segregation [Paras 7–12].

Duties of State and Local Authorities – Monitoring and Enforcement – Obligations under Sections 6 to 9 and Section 31 of RTE Act emphasised – National and State Commissions for Protection of Child Rights entrusted with monitoring, grievance redressal and enforcement of children’s right to education [Paras 6.1–6.3, 11–12].

Standard Operating Procedure – NCPCR – Non-binding Nature – SOPs and guidelines found insufficient in absence of enforceable statutory rules – Lack of uniformity across States and UTs undermining effective implementation of Section 12(1)(c) [Paras 12–15].

Subordinate Legislation – Necessity – Supreme Court held formulation of rules under Section 38 of RTE Act imperative – Without enforceable rules, mandate of Article 21A and Section 12(1)(c) would remain illusory – Directions issued to frame rules in consultation with NCPCR, SCPCRs and Advisory Councils [Paras 15–16].

Directions – Compliance and Monitoring – NCPCR directed to be impleaded as party respondent – Directed to collate information regarding framing of rules by States and UTs and file affidavit before Supreme Court – Matter kept pending for further monitoring [Paras 16–16.3].

Decision: Special Leave Petition retained for precedent and policy directions – Appropriate Governments directed to frame enforceable rules for implementation of Section 12(1)(c) – NCPCR tasked with monitoring compliance – Matter listed for further hearing.

Service Law – Army Pension – Dismissal by Court Martial – Forfeiture of Pension – Distinction between Commissioned Officers and JCOs – Respondent, a Junior Commissioned Officer (JCO), dismissed from service in 1967 pursuant to General Court Martial – No specific order passed at the time of dismissal regarding forfeiture of pensionary benefits – Armed Forces Tribunal allowed claim for pension relying on Major G.S. Sodhi v. Union of India – Held: Regulation 113(a) of Pension Regulations, 1961 applies to JCOs and provides for automatic forfeiture of pension and gratuity on dismissal – No separate or specific order of forfeiture required – AFT erred in applying Regulation 16(a), which governs Commissioned Officers only [Paras 4, 6, 9–11, 14].

Pension Regulations – Regulation 16(a) vs Regulation 113(a) – Applicability – Regulation 16(a) falling under Chapter II applies exclusively to Commissioned Officers – Regulation 113(a) applies to JCOs, other ranks and enrolled non-combatants – As per Regulation 113(a), dismissal under the Army Act ipso facto renders the individual ineligible for pension or gratuity, subject only to discretionary power of the President in exceptional cases – Clarified and reaffirmed in Union of India v. Subedar Ram Narain [Paras 9–11, 15].

Armed Forces Tribunal – Error of Law – Reliance on Inapplicable Precedent – Tribunal relied on Major G.S. Sodhi, which dealt with a Commissioned Officer governed by Regulation 16(a) – Said precedent held inapplicable to JCOs – Tribunal’s direction granting pensionary benefits to dismissed JCO held legally unsustainable [Paras 6, 15–16].

Equitable Relief – Recovery of Amount Already Paid – Delay in Appeal – Death of Respondent – Appeal filed with considerable delay and during pendency, arrears of pension paid to respondent pursuant to AFT’s order – Respondent died during pendency of appeal – Though Tribunal’s order set aside on merits, Supreme Court directed that amounts already paid shall not be recovered, balancing equities and avoiding undue hardship to legal heirs [Paras 12, 17].

Decision: Appeal allowed – Orders dated 30.04.2012 and 13.06.2014 passed by the Armed Forces Tribunal set aside – Direction issued that amounts already paid to the respondent pursuant to Tribunal’s orders shall not be recovered – Pending applications disposed of.

Service Law – Drug Inspector / Drug Control Officer – Qualifications for Appointment – Central vs State Rule-making Power – Doctrine of Occupied Field – Rule 49, Drugs and Cosmetics Rules, 1945 – State Rules prescribing experience as essential qualification – Invalid – Parliament under the Drugs and Cosmetics Act, 1940 has expressly conferred exclusive power on the Central Government to prescribe qualifications of Inspectors – Rule 49 prescribes educational qualifications for appointment and experience only for authorisation to inspect manufacture of Schedule C drugs – State Governments lack competence to elevate such experience into a mandatory eligibility condition for initial appointment – Field fully occupied by Central legislation – State Rules framed under proviso to Article 309 or under State service statutes cannot override or supplement Rule 49 – Held: State-prescribed experience requirement ultra vires the D&C Act and Drug Rules [Paras 23–56].

Statutory Interpretation – Proviso to Rule 49, Drugs Rules – Nature and Scope – Experience not a condition of eligibility for appointment – Proviso merely carves out a class of Inspectors authorised to inspect manufacture of Schedule C substances – Experience contemplated post-appointment and for limited functional authorisation – Cannot be read as minimum or essential qualification for recruitment – Any such reading would amount to rewriting statutory rules – Affirmed views of Allahabad High Court (Kuldeep Singh) and Delhi High Court (Nidhi Pandey) [Paras 31–41, 53–55].

Constitutional Law – Article 309 – Limits of Executive Rule-making – Central Statute occupying field – Rule-making under proviso to Article 309 is subject to existing legislation – Once Parliament enacts a law and delegates rule-making power, executive power under Article 309 stands displaced – Doctrine of occupied field applies – Rules framed by Governor or State under Article 309 cannot supersede rules framed under Central statute – Relied on A.B. Krishna v. State of Karnataka [Paras 42–45].

Concurrent List – Drugs and Poisons (Entry 19, List III) – Pre-Constitution legislation – Article 372 – Drugs and Cosmetics Act enacted under Section 103, Government of India Act, 1935 with provincial consent – Continued in force post-Constitution under Article 372 – In absence of State amendment to the Act, States cannot legislate indirectly by service rules on matters expressly governed by Central law – Central Rules prevail [Paras 24–30, 46].

Distinction from S. Satyapal Reddy v. Govt. of A.P. – Motor Vehicles Act empowered Centre to prescribe only “minimum qualifications” leaving scope for States to prescribe higher qualifications – Drugs and Cosmetics Act contains no such latitude – Central Government alone empowered to prescribe qualifications of Inspectors – Judgment held inapplicable [Paras 47–49].

Haryana and Karnataka Recruitment Processes – Consequences – Advertisements prescribing experience as essential qualification quashed – Selection processes based on such criteria unsustainable – Directions issued for re-drawing merit lists strictly in accordance with Rule 49 of Drug Rules – Experience to be ignored for eligibility [Paras 57–69].

Relief and Directions – Moulding of Relief – Article 142 – Conditional appointees in Haryana protected subject to placement in revised merit list – If falling within merit, to continue with consequential benefits – If not, State may continue them on supernumerary posts without affecting advertised vacancies – Karnataka PSC directed to redo selection list and appointments accordingly – Timelines fixed for compliance [Paras 70–71].

Decision: Appeals by State of Haryana and State of Karnataka dismissed – Appeal by Parveen Kumar (Diary No. 1909/2024) allowed – State-prescribed experience as essential qualification for appointment of Drug Inspector / Drug Control Officer declared ultra vires – Public Service Commissions directed to redraw merit lists strictly as per Rule 49 of the Drugs and Cosmetics Rules, 1945 – Appointments to follow accordingly.

Arbitration Law - Arbitration and Conciliation Act, 1996 – Section 34 – Withdrawal of petitions – Revival by Supreme Court – Land owners whose lands were acquired under the National Highways Act, 1956 had withdrawn their Section 34 petitions following High Court judgment declaring Sections 3G and 3J unconstitutional – Supreme Court subsequently stayed the High Court judgment – Fresh petitions barred by limitation under Section 34(3) – Held: To avoid grave injustice and remedilessness, Supreme Court invoked Article 142 and set aside the withdrawal order – Section 34 petitions restored to their original stage [Paras 1–4].

Constitution of India – Article 142 – Complete justice – Exercise of plenary powers – Supreme Court found that withdrawal of arbitral challenges occurred due to an intervening High Court judgment later stayed by Supreme Court – Applicants would otherwise suffer irreparable prejudice – Held: Article 142 power rightly invoked to revive proceedings and restore status quo ante [Paras 2–4].

National Highways Act, 1956 – Sections 3G and 3J – Arbitral mechanism – Competent authority and notified arbitrators – Court noted that arbitration under Section 3G(5) is conducted by executive officers such as Collectors/Commissioners lacking judicial training and adequate time – Such mechanism raises concerns in adjudication of complex compensation issues [Paras 5–6].

Land Acquisition – Compensation – Comparative statutory regimes – Supreme Court contrasted remedies available under the National Highways Act, 1956 with those under the Land Acquisition Act, 1894 and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 – Held: Land owners under the 1956 Act form a disadvantaged class without intelligible differentia, leading to apparent inequality in violation of Article 300-A [Paras 7–9].

Legislative Policy – Infrastructure development versus property rights – While acknowledging the need for expeditious highway development, Supreme Court observed that parity in compensation determination mechanisms can coexist with speedy acquisition – Court urged reconsideration of the statutory framework to ensure fairness without undermining national infrastructure goals [Paras 10–12].

Judicial Restraint – Legislative domain – Supreme Court refrained from striking down provisions at this stage and left the matter to legislative wisdom – Attorney General requested to examine the issue – Registry directed to forward order to Attorney General and Solicitor General – Interim orders continued [Paras 12–16].

Decision: Interlocutory Applications allowed – Order dated 25.04.2025 of the Additional District Judge, Bhiwani set aside – All Section 34 petitions revived and to proceed from the stage of withdrawal – Matters posted for further consideration on 21.04.2026 – Interim orders to continue.