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Case Name: Maneesha Yadav and Others v. The State of Uttar Pradesh and Another

Case Number: Criminal Appeal No. of 2024 [Arising out of SLP(Criminal) No. 8922 of 2022]

Date of Judgment: April 09, 2024

Quorum: B.R. Gavai, J.

FACTS OF THE CASE

Raj School of Nursing and Paramedical College, Gorakhpur, was initially permitted to admit sixty students, but this was later reduced to forty. Despite the reduction, the institute admitted sixty students. When the results for twenty students were withheld, it was revealed that these students were admitted illegally. Complaints were filed, including one by Respondent No. 2, leading to the registration of FIR No. 18 of 2015 at Police Station Kotwali, Gorakhpur. The FIR alleged that Dr. Rajaram Yadav, the Manager, Dr. Abhishek Yadav, the Director, and Dr. C. Prasad, the Principal, advertised sixty seats and induced the complainant to pay for an invalid admission. The FIR included charges under Sections 419, 420, 467, 468, 471, 406, 504, and 506 of the IPC. The three appellants, Maneesha Yadav, Dr. Poonam Yadav, and Shobhita Nandan Yadav, petitioned the High Court to quash the FIR, arguing they were not involved in the institute’s management. The High Court dismissed their petition, suggesting they could apply for discharge. The Supreme Court issued an interim order to prevent coercive actions against them. The appellants claimed they had no role in managing the institute, and the Supreme Court found that the FIR did not provide specific allegations against them. The Court ruled that the proceedings against the appellants were an abuse of the legal process, as the FIR did not establish their involvement in the alleged offenses.

ISSUES

• Whether the FIR disclosed sufficient material to constitute the alleged offenses against the appellants.
• Whether the High Court erred in dismissing the petition under Section 482 of the Cr.P.C. for quashing the FIR.
• Whether the relationship of the appellants to the primary accused justified their inclusion in the FIR.

LEGAL PROVISIONS

Section 482 of the Code of Criminal Procedure, 1973 (Cr.P.C.):

• This section grants inherent powers to the High Court to make orders necessary to prevent abuse of the process of any court or otherwise to secure the ends of justice. It is the primary provision invoked by the appellants seeking quashing of the FIR.

Sections of the Indian Penal Code, 1860 (IPC):

• Section 419 (Cheating by personation): This section deals with the punishment for cheating by pretending to be someone else or by fraudulently representing another person.
• Section 420 (Cheating and dishonestly inducing delivery of property): This section pertains to cheating and inducing someone dishonestly to deliver property or valuable security.
• Section 467 (Forgery of valuable security, will, etc.): This section deals with the offense of forgery involving valuable securities, wills, or other significant documents.
• Section 468 (Forgery for purpose of cheating): This section applies to forgery committed with the intent to cheat.
• Section 471 (Using as genuine a forged document or electronic record): This section pertains to the use of a forged document as genuine.
• Section 406 (Criminal breach of trust): This section involves the criminal breach of trust, where property is entrusted to someone and then misappropriated or converted to their own use.
• Section 504 (Intentional insult with intent to provoke breach of the peace): This section addresses intentional insults made with the intent to provoke a breach of the peace.
• Section 506 (Criminal intimidation): This section deals with the offense of criminal intimidation, where someone threatens another with injury to their person, reputation, or property.

 Sections 239, 227, and 245 of the Cr.P.C.:

• Section 239 (Discharge): This section allows the Magistrate to discharge the accused if the charge against them is groundless.
• Section 227 (Discharge): This section allows the Sessions Court to discharge the accused if there is no sufficient ground for proceeding against them.
• Section 245 (Discharge): This section allows the Magistrate to discharge the accused if, upon taking all evidence, no case against the accused has been made out which, if unrebutted, would warrant their conviction.

Article 226 of the Constitution of India:

• This article empowers the High Court to issue certain writs for enforcement of fundamental rights and for any other purpose. It was referenced in relation to the inherent powers of the High Court under Section 482 of the Cr.P.C.

CONTENTIONS OF THE APPELLANT

The appellants argued that they were not involved in the day-to-day management or operations of Raj School of Nursing and Paramedical College. They contended that they neither held any official positions nor had any responsibilities that connected them to the alleged illegal admissions. Specifically, Maneesha Yadav is the wife of the Director, Dr. Poonam Yadav is the sister of the Director and daughter of the Manager, and Shobhita Nandan Yadav is an employee. The appellants emphasized that their familial relationships alone did not implicate them in the alleged offenses. The appellants contended that the FIR did not contain specific allegations or evidence against them. They argued that the FIR lacked any direct accusations of inducement or fraudulent actions on their part. The only reason for their implication in the FIR appeared to be their relationship with the primary accused, which, according to the appellants, was insufficient to establish their involvement in the alleged crimes. They argued that the FIR, even if taken at face value, failed to disclose any material that constituted the alleged offenses under the IPC. The appellants asserted that the continuation of criminal proceedings against them amounted to an abuse of the process of law. They argued that the lack of substantive allegations against them indicated that the proceedings were unjust and would result in undue harassment. The appellants maintained that the High Court should have exercised its inherent powers under Section 482 of the Cr.P.C. to quash the FIR and prevent the misuse of judicial processes. The appellants argued that the High Court’s suggestion to seek discharge under Sections 239, 227, or 245 of the Cr.P.C. was not an adequate remedy in their case. They contended that invoking these provisions would not address the fundamental issue that the FIR itself was baseless and did not warrant further proceedings. They emphasized that the High Court should have quashed the FIR outright, rather than directing them to seek discharge at a later stage. The appellants referenced several judicial precedents to support their contentions. They cited cases where the Supreme Court had quashed proceedings in the absence of sufficient material evidence against the accused. They argued that their case fell within the parameters set by these precedents, particularly the guidelines established in the case of State of Haryana and Others v. Bhajan Lal and Others, which outlined scenarios where the High Court could exercise its powers to quash proceedings.

CONTENTIONS OF THE RESPONDENT

The respondents argued that the appellants were connected to the management and operations of Raj School of Nursing and Paramedical College by virtue of their relationships with the primary accused. They asserted that Maneesha Yadav, being the wife of the Director, Dr. Poonam Yadav, the sister of the Director and daughter of the Manager, and Shobhita Nandan Yadav, an employee of the institute, had roles that implicated them in the alleged illegal activities. The respondents maintained that these relationships and roles were sufficient to include the appellants in the criminal proceedings. The respondents contended that the FIR contained sufficient allegations to warrant further investigation and proceedings against the appellants. They argued that the FIR outlined a clear case of cheating and inducement, where the complainant and other students were misled into believing that their admissions were against sanctioned seats. The respondents asserted that the appellants’ connection to the management was enough to infer their involvement in the fraudulent activities described in the FIR. The respondents argued that the appellants had appropriate legal remedies available to them, such as filing for discharge under Sections 239, 227, or 245 of the Cr.P.C. They maintained that the High Court was correct in suggesting that the appellants could seek discharge if there was no sufficient ground for proceeding against them. The respondents emphasized that the process for discharge was the appropriate legal channel for the appellants to address their grievances. The respondents contended that quashing the FIR at the initial stage would be premature and unwarranted. They argued that the investigation should be allowed to proceed to gather evidence and determine the extent of the appellants’ involvement. The respondents cited judicial precedents where courts have held that the defense of the accused cannot be considered at the stage of quashing an FIR and that the investigation should not be stifled prematurely. The respondents referred to several judicial precedents to bolster their argument that the FIR should not be quashed prematurely. They highlighted cases where the courts have emphasized the importance of allowing the investigation to proceed and have cautioned against quashing FIRs without a thorough examination of the allegations and evidence. The respondents asserted that the allegations in the FIR, if taken at face value, justified an investigation and potential prosecution.

COURT’S ANALYSIS ANS JUDGEMENT

The respondent contended that there existed a prima facie case against the appellants based on the allegations in the FIR. They argued that the appellants, being close relatives of the management officials of Raj School of Nursing and Paramedical College, were implicated in the illegal admissions scandal. Specifically, Maneesha Yadav is the wife of the Director, Dr. Poonam Yadav is the sister of the Director and daughter of the Manager, and Shobhita Nandan Yadav is an employee of the institute. The respondent emphasized that these familial ties indicated a potential role or knowledge of the illegal admissions, thus justifying their inclusion in the FIR. The respondent argued that familial relationships were relevant in determining the involvement of the appellants in the alleged offenses. They contended that as close relatives of the management officials, the appellants could have had knowledge of or benefited from the illegal admissions scheme. They asserted that familial proximity suggested a level of complicity or knowledge that warranted their inclusion in the criminal proceedings. In response to the appellants’ plea for quashing of the FIR under Section 482 of the Cr.P.C., the respondent argued that the High Court correctly exercised its jurisdiction. They contended that the High Court’s decision not to quash the FIR was based on established principles that discourage premature interference in ongoing criminal proceedings. The respondent emphasized that the appellants had alternative remedies, such as applying for discharge under Sections 239, 227, or 245 of the Cr.P.C., which would be more appropriate at a later stage of the proceedings. The respondent asserted that the allegations in the FIR provided sufficient grounds for prosecution against the appellants. They argued that the allegations of inducement, fraudulent admissions, and misuse of authority were serious and required further investigation and legal proceedings. They maintained that the FIR, when taken at face value, disclosed adequate material to establish the commission of offenses under various sections of the IPC. The respondent referenced legal precedents to support their arguments regarding the jurisdiction of the High Court and the sufficiency of allegations in the FIR. They cited cases where courts upheld the continuation of proceedings based on initial allegations until sufficient evidence or legal arguments warranted otherwise. They argued that the principles laid down in these precedents supported the ongoing prosecution against the appellants based on the allegations made in the FIR.

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Case Name: State Bank of India v. Association for Democratic Reforms and Others

Case Number: Miscellaneous Application No. 486 of 2024 in Writ Petition (Civil) No. 880 of 2017

Date of Order: March 11, 2024

Quorum: The bench comprised the following justices: Chief Justice (CJI) Dr. Dhananjaya Y Chandrachud, Justice Sanjiv Khanna, Justice B.R. Gavai, Justice J.B. Pardiwala, Justice Manoj Misra

FACTS OF THE CASE

In February 2024, the Supreme Court of India declared the Electoral Bond Scheme and parts of the Finance Act 2017 unconstitutional. The Court found that non-disclosure of political funding violated citizens’ right to information under Article 19(1)(a) and that unlimited corporate funding of political parties was arbitrary, violating Article 14. The State Bank of India (SBI), responsible for handling Electoral Bonds, was ordered to submit detailed information on bonds purchased and redeemed from 12 April 2019 to 15 February 2024. This information was to be provided to the Election Commission of India (ECI) by 6 March 2024 and published by the ECI by 13 March 2024. SBI requested an extension until 30 June 2024, citing difficulties due to the information being stored in separate silos and the complexity of matching donor and redemption details. The Supreme Court rejected this request, emphasizing that the necessary information was available and that confidentiality provisions did not preclude court-ordered disclosure. The Court directed SBI to comply by 12 March 2024 and the ECI to publish the information by 15 March 2024. SBI’s Chairman and Managing Director were required to file a compliance affidavit. The Court warned of potential contempt proceedings for non-compliance but refrained from immediate action.

ISSUES

• Whether the Electoral Bond Scheme, which allows anonymous donations to political parties, violates citizens’ right to information under Article 19(1)(a) of the Constitution.
• Whether the amendments introduced by the Finance Act 2017 to the Companies Act 2013, permitting unlimited corporate funding of political parties, are arbitrary and violate Article 14 of the Constitution, which guarantees equality before the law.
• Whether the State Bank of India (SBI) should disclose detailed information on the purchase and redemption of Electoral Bonds to ensure transparency in political funding, and whether SBI’s request for an extension to comply with the Supreme Court’s disclosure order was justified.

LEGAL PROVISIONS

Article 19(1)(a) of the Constitution of India:

This article guarantees the right to freedom of speech and expression, which includes the right to information. The petitioners argued that the Electoral Bond Scheme violates this right by allowing anonymous political donations, thereby depriving citizens of information about political funding.

Article 14 of the Constitution of India:

This article guarantees equality before the law and equal protection of the laws. The petitioners contended that the amendments allowing unlimited corporate funding of political parties are arbitrary and violate this principle of equality.

 Representation of the People Act, 1951:

The amendments introduced by the Finance Act 2017 to this act facilitated anonymous donations through Electoral Bonds. The constitutionality of these amendments was challenged.

Income Tax Act, 1961:

The Finance Act 2017 also amended this act to exempt political parties from disclosing donations received through Electoral Bonds in their contribution reports, thus enabling anonymity.

Companies Act, 2013:

The amendments to this act removed the cap on corporate donations to political parties and eliminated the requirement for companies to disclose the names of the political parties to which they donated. These changes were challenged as being arbitrary and in violation of Article 14.

Finance Act, 2017:

This act introduced the Electoral Bond Scheme and amended the above statutes to incorporate provisions facilitating anonymous donations to political parties. The overall constitutionality of these amendments was questioned.

CONTENTIONS OF THE APPELLANT

SBI argued that the information required by the Supreme Court regarding the purchase and redemption of Electoral Bonds was maintained in two separate silos to ensure confidentiality. The process of “decoding the Electoral Bonds and matching the donor to the donations” was complex and time-consuming. They emphasized that the Electoral Bond Scheme mandated confidentiality of donor information, and the data was stored securely in separate physical silos, necessitating a detailed and labor-intensive matching process to compile the required information. SBI highlighted several operational challenges that hindered immediate compliance with the Court’s order. They pointed out that the information on bond purchases, including KYC details, was not maintained in a digital format within the core banking system. The details were instead kept in sealed covers at designated branches and periodically sent to the Mumbai main branch. Similarly, details of bond redemptions by political parties were stored separately. The task of manually matching over 22,000 bonds with their corresponding redemption data, totaling around 44,000 data sets, was argued to be extremely resource-intensive and time-consuming. Based on the operational difficulties and the volume of data involved, SBI sought an extension until 30 June 2024 to comply with the Supreme Court’s order. They contended that while they were committed to fulfilling the Court’s directive, the complexity of the task and the need to maintain the integrity and confidentiality of the information required additional time. SBI assured the Court that the matching of information and subsequent disclosure could be completed within this extended timeframe, allowing for accurate and thorough compilation of the data. SBI’s contentions aimed to explain the practical difficulties in immediate compliance and sought the Court’s understanding and additional time to meet the disclosure requirements fully.

CONTENTIONS OF THE RESPONDENT

The respondents argued that the Electoral Bond Scheme violated the citizens’ right to information under Article 19(1)(a) of the Constitution. They contended that the anonymity provided by the scheme deprived citizens of essential information regarding political funding, which is crucial for a transparent democratic process. The lack of transparency in the sources of political donations hindered the voters’ ability to make informed choices, thereby undermining the democratic process. The respondents challenged the amendments introduced by the Finance Act 2017 to the Representation of People Act 1951, the Income Tax Act 1961, and the Companies Act 2013. They argued that these amendments were arbitrary and violated Article 14 of the Constitution, which guarantees equality before the law. By allowing unlimited corporate funding of political parties without disclosure, the amendments created an uneven playing field, favoring larger, well-funded political parties and disadvantaging smaller parties and independent candidates. The respondents contended that the information regarding the purchase and redemption of Electoral Bonds was readily available with SBI, despite being maintained in separate silos. They argued that SBI’s plea for an extension of time was unjustified and a tactic to delay compliance with the Supreme Court’s order. The respondents emphasized that the matching of donor and redemption details was feasible and necessary to uphold the Court’s directive for transparency in political funding. The respondents stressed that the Supreme Court’s order for the disclosure of Electoral Bond transactions was in the public interest. They argued that timely compliance with the Court’s directive was essential to ensure accountability and transparency in political financing. The respondents pointed out that the Supreme Court had already recognized the significance of this issue by declaring the scheme and the related amendments unconstitutional. Therefore, SBI’s request for an extension was viewed as an attempt to undermine the Court’s efforts to enhance transparency and accountability in the electoral process. Given SBI’s failure to comply with the Supreme Court’s order within the stipulated timeframe, the respondents invoked the Court’s contempt jurisdiction. They argued that SBI’s non-compliance amounted to willful disobedience of the Court’s directive, warranting contempt proceedings. The respondents urged the Court to take strict action against SBI to uphold the authority of the judiciary and ensure adherence to its orders. These contentions underscored the respondents’ insistence on transparency in political funding and their opposition to any delays in the implementation of the Supreme Court’s order.

COURT’S ANALYSIS AND JUDGEMENT

The Supreme Court critically examined SBI’s request for an extension of time to comply with its order. The Court noted SBI’s explanation regarding the complexities involved in matching donor information with bond redemption details due to the data being stored in two separate silos. However, the Court emphasized that the information required for compliance was already available, albeit in separate forms, and that the matching process, while detailed, was not an insurmountable task. The Court addressed the issue of confidentiality as stipulated in the Electoral Bond Scheme. It highlighted Clause 7(4) of the scheme, which mandates that information furnished by the buyer of an Electoral Bond should be treated as confidential and only disclosed upon a court’s directive or a law enforcement agency’s registration of an offense. The Court reiterated that, as a competent judicial authority, its directive for disclosure must be adhered to by SBI.

The Court found SBI’s arguments about operational challenges unconvincing. It pointed out that the Electoral Bond Scheme itself, as well as the FAQs published by SBI, indicated that necessary information, such as KYC documents and transaction details, was collected and maintained meticulously. The Court highlighted that both donor and redemption information were systematically stored and could be accessed and matched with reasonable effort. The Supreme Court underscored the significance of its earlier judgment declaring the Electoral Bond Scheme and related amendments unconstitutional. It reiterated that the lack of transparency in political funding violated citizens’ right to information under Article 19(1)(a) of the Constitution. Ensuring transparency in political funding was deemed essential for maintaining the integrity of the democratic process. The Court emphasized the urgency and public interest in disclosing the details of Electoral Bond transactions.

The Court dismissed SBI’s request for an extension of time until 30 June 2024. It mandated that SBI must disclose the required details by the close of business hours on 12 March 2024. The Election Commission of India (ECI) was instructed to compile and publish this information on its official website by 15 March 2024. The Court also required SBI to submit an affidavit of compliance from its Chairman and Managing Director by the stipulated deadline. While the Court refrained from exercising its contempt jurisdiction immediately, it issued a stern warning to SBI. The Court stated that if SBI failed to comply with its directives within the specified timeframe, it would consider initiating contempt proceedings for willful disobedience of its order.

The Supreme Court, thus, dismissed SBI’s Miscellaneous Application for an extension of time and directed immediate compliance with its earlier judgment. The Court reinforced the constitutional mandate for transparency in political funding and upheld the citizens’ right to information, ensuring that the details of Electoral Bond transactions were disclosed in a timely manner.

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Case Name: Wg Cdr A U Tayyaba (retd) & Ors vs. Union of India & Ors

Case Number: Miscellaneous Application No. [number] of 2024 (Diary No. 8208 of 2024) in   Civil Appeal Nos. 79-82 of 2012

Dated On: The order is dated April 15, 2024.

Quorum: The hearing was attended by three judges:

1. HON’BLE THE CHIEF JUSTICE
2. HON’BLE MR. JUSTICE J.B. PARDIWALA
3. HON’BLE MR. JUSTICE MANOJ MISRA

FACTS OF THE CASE

The case involves a group of women Short Service Commissioned Officers (SSCOs) in the Indian Armed Forces, including Wg Cdr A U Tayyaba (retd) and others. These officers were released from service after completing fourteen years, without receiving pensionary benefits that are typically granted upon completing twenty years of service. Following a Supreme Court judgment on November 16, 2022, which directed that these women SSCOs be considered for one-time pensionary benefits as if they had completed twenty years of service, the appellants found that the authorities had calculated their pensions based on the last salary drawn at the time of their release. This calculation did not include the notional increments they would have received had they served the full twenty years. The appellants filed a Miscellaneous Application, arguing that the authorities had misinterpreted the Court’s judgment. They sought clarification and correction of the pension calculations to include these notional increments, ensuring their pensions were computed based on the salary they would have drawn at the deemed completion of twenty years of service. They also sought clarification on the computation of the commuted value of their pension, encashment of annual leave, and entitlement to Ex-Servicemen Contributory Health Scheme (ECHS) benefits.

ISSUES

• Whether the authorities correctly interpreted the Supreme Court’s judgment from November 16, 2022, in calculating the pensionary benefits for the women SSCOs. Specifically, the issue is whether the pension should include notional increments from the date of their release to the deemed completion of twenty years of service.
• How to accurately compute the commuted value of the pension, including determining the appropriate commutation factor based on the deemed completion date of twenty years of service. This involves ensuring the commutation factor used reflects the status as if the officers had completed the full twenty years.
• Whether the women SSCOs are entitled to ECHS benefits as retired officers. This issue involves clarifying their eligibility for these health benefits post-retirement based on their deemed completion of the required service period.

LEGAL PROVISIONS

• The Indian Army Act, 1950: This act governs the terms and conditions of service for personnel in the Indian Army, including provisions related to retirement, pension, and other benefits.
• Pension Regulations for the Army, 1961: These regulations outline the eligibility criteria and computation methods for pension and retirement benefits for army personnel, including SSCOs. Key provisions include the minimum qualifying service required for pension eligibility and the calculation of pensionary benefits.
• The Central Civil Services (Pension) Rules, 1972: Although primarily applicable to civilian employees of the government, these rules provide guidelines that are sometimes referenced for military personnel regarding the computation of pension and related benefits.

CONTENTIONS OF THE APPELLANT

The appellants argue that the authorities have misinterpreted the Supreme Court’s judgment from November 16, 2022. They contend that the pension calculations were erroneously based on the last drawn salary at the time of their release, without considering notional increments between the release date and the deemed completion of twenty years of service. The appellants assert that their pensions should be computed based on the salary they would have earned at the deemed completion of twenty years of service. They argue that since they are considered to have completed the minimum qualifying service for pension, notional increments should be included to accurately reflect their entitlement to pensionary benefits. Additionally, the appellants raise concerns regarding the calculation of the commuted value of their pension. They argue that the commutation factor should be determined based on the date of the deemed completion of twenty years of service, ensuring that the commuted value reflects their full service period. The appellants seek clarification on the encashment of annual leave, particularly whether they are entitled to encash any remaining balance of accumulated leave up to the maximum allowable limit of 300 days. Finally, the appellants assert their entitlement to Ex-Servicemen Contributory Health Scheme (ECHS) benefits as retired officers. They contend that their retirement status, as determined by the deemed completion of twenty years of service, qualifies them for these health benefits. Overall, the appellants’ contentions revolve around ensuring that their pensionary benefits are accurately computed and that they receive all entitlements owed to them based on their service in the armed forces.

CONTENTIONS OF THE RESPONDENT

The respondent contends that the authorities have correctly interpreted the Supreme Court’s judgment from November 16, 2022. They argue that the pension calculations were appropriately based on the last drawn salary at the time of the appellants’ release, in accordance with the directions provided in the judgment. The respondent asserts that the pension calculations were carried out in compliance with the relevant pension regulations for the armed forces. They argue that the regulations stipulate the criteria and methods for computing pensionary benefits, including the consideration of the last drawn salary. Additionally, the respondent emphasizes that while the appellants may be considered to have completed the minimum qualifying service for pension, there are limitations on the entitlements they are eligible to receive. They highlight that the Supreme Court’s judgment explicitly stated that the officers would not be entitled to any arrears of salary, but only arrears of pension with effect from the deemed completion of twenty years of service. Regarding the computation of the commuted value of the pension, the respondent argues that the calculations were performed in accordance with the applicable rules and regulations. They assert that the commutation factor used was appropriate and based on the relevant guidelines at the time of calculation. The respondent maintains that any issues related to the encashment of annual leave and entitlement to ECHS benefits are being addressed in accordance with the applicable administrative procedures and guidelines. They contend that the appellants’ claims for these benefits should be assessed based on the relevant regulations and instructions governing such matters. Overall, the respondent’s contentions focus on defending the correctness of the pension calculations and asserting that the actions taken were in compliance with the applicable laws, regulations, and court directives. They emphasize the limitations on entitlements and seek to address any remaining issues through appropriate administrative procedures.

COURT’S ANALYSIS AND JUDGEMENT

The Court begins its analysis by reiterating the directions issued in its judgment dated November 16, 2022. It emphasizes that the key directive was for all women Short Service Commissioned Officers (SSCOs) governed by the batch of cases to be considered for one-time pensionary benefits as if they had completed the minimum qualifying service required for pension, which is twenty years. The Court evaluates the implementation of its directions by the Union government and finds discrepancies in the computation of pensionary benefits. It notes that the authorities calculated the pensions based on the last drawn salary at the time of the appellants’ release, without including notional increments for the period between release and the deemed completion of twenty years of service.

The Court clarifies that pensionary payments should indeed be computed based on the salary at the deemed completion of twenty years of service. It emphasizes that notional increments should be included for the period between release and the deemed completion date, in accordance with the directive to consider the officers as having completed the minimum qualifying service for pension. The Court addresses the grievances raised by the appellants, including the computation of the commuted value of the pension and the encashment of annual leave. It directs that the commuted value should be calculated as of the deemed completion date of twenty years of service, and any remaining encashable leave should be computed and paid accordingly.

Regarding the entitlement to Ex-Servicemen Contributory Health Scheme (ECHS) benefits, the Court affirms that the women SSCOs are entitled to these benefits as retired officers. The Court orders the correction of the PPOs to accurately reflect the status of the appellants and ensure future pension revisions. It directs that the PPOs should be corrected before a specified deadline. Based on the above analysis and directions, the Court disposes of the Miscellaneous Application, resolving the grievances of the appellants and providing clarity on the computation of pensionary benefits and entitlements.

In conclusion, the Court’s judgment provides a comprehensive analysis of the issues raised, clarifies the correct application of its directions, and issues appropriate directives to ensure the accurate computation of pensionary benefits and entitlements for the women SSCOs involved in the case.

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Case Name: Insolvency and Bankruptcy Board of India v. Satyanarayan Bankatlal Malu & Ors.

Case Number: Criminal Appeal No. 3851 of 2023

Date of Judgment: April 19, 2024

Quorum: B.R. Gavai, J.

FACTS OF THE CASE

The case involves a dispute regarding the interpretation of Section 236(1) of the Code of Criminal Procedure (CrPC) in relation to the Companies Act, 2013. The central question is whether offenses under the CrPC should be tried by the Special Court established under Chapter XXVIII of the Companies Act, 2013. The court examines whether the reference in Section 236(1) of the CrPC to the Special Court indicates legislation by reference or legislation by incorporation. It concludes that the reference is specific, indicating legislation by incorporation, and therefore any subsequent amendments to the Companies Act, 2013, would not affect the provisions of Section 236(1) of the CrPC. Consequently, the court holds that offenses under the CrPC should be tried by a Special Court presided over by a Sessions Judge or an Additional Sessions Judge. However, since the High Court did not consider the merits of the case, the matter is remitted back to the High Court for fresh consideration.

ISSUES

• Interpretation of Section 236(1) of the Code of Criminal Procedure (CrPC) concerning the trial of offenses under the Companies Act, 2013.
• Determination of whether the offenses under the CrPC should be tried exclusively by the Special Court established under Chapter XXVIII of the Companies Act, 2013.
• Clarification on whether the reference to the Special Court in Section 236(1) of the CrPC signifies legislation by reference or legislation by incorporation, and its implications on subsequent amendments to the Companies Act, 2013.

 LEGAL PROVISIONS

• Section 236(1) of the Code of Criminal Procedure (CrPC): This section deals with the trial of offenses under the Companies Act, 2013 and stipulates that such offenses shall be tried by the Special Court established under Chapter XXVIII of the Companies Act, 2013.
• Chapter XXVIII of the Companies Act, 2013: This chapter outlines the provisions related to Special Courts established under the Companies Act, 2013 for the trial of offenses under the said Act.
• Companies Act, 2013: Various provisions of the Companies Act, 2013 are relevant to understanding the jurisdiction and procedures related to the trial of offenses under this Act.

CONTENTIONS OF THE APPELLANT

The appellant argued that the reference in Section 236(1) of the Code of Criminal Procedure (CrPC) to the trial of offenses under the Companies Act, 2013 by the Special Court established under Chapter XXVIII of the Companies Act, 2013 is specific and not general. They contended that this specificity indicates a case of legislation by incorporation rather than legislation by reference. Furthermore, the appellant asserted that if the provision is deemed to be legislation by incorporation, the effect would be that the provision regarding the Special Court, as mentioned in Section 435 of the Companies Act, 2013, would become a part of Section 236(1) of the CrPC. This means that any subsequent amendments to Section 435 of the Companies Act, 2013, after the enactment of the CrPC, would not affect the provisions of Section 236(1) of the CrPC. The appellant highlighted that the CrPC has undergone two subsequent amendments, namely the 2015 Amendment and the 2018 Amendment. They argued that if the legislative intent was to give effect to the subsequent amendments in the Companies Act regarding Section 435, the legislature could have amended Section 236(1) of the CrPC accordingly. Since no such amendment was made, the provision regarding the reference to the Special Court in Section 236(1) of the CrPC remained frozen as of the date of the CrPC’s enactment. Therefore, the appellant contended that the High Court erred in its interpretation and conclusion that offenses under the Code should be tried only by a Metropolitan Magistrate or a Judicial Magistrate of the First Class in light of the subsequent amendments to the Companies Act. They argued that even if the reference in Section 236(1) of the CrPC is considered a legislation by reference, offenses punishable under the Code with imprisonment of two years or more should be tried by a Special Court presided over by a Sessions Judge or an Additional Sessions Judge, as per the applicable provisions.

CONTENTIONS OF THE RESPONDENT

The respondent argued that the provision in Section 236(1) of the Code of Criminal Procedure (CrPC) regarding the trial of offenses under the Companies Act, 2013 by the Special Court established under Chapter XXVIII of the Companies Act, 2013 should be interpreted in light of subsequent amendments to the Companies Act. They contended that the subsequent amendment to the Companies Act in 2018 altered the composition of the Special Court, limiting it to presided over by a Sessions Judge or an Additional Sessions Judge only for offenses under the Companies Act. Therefore, they argued that offenses under the Code should be tried by a Metropolitan Magistrate or a Judicial Magistrate of the First Class, as per the amended provisions. The respondent emphasized that the legislative intent behind the amendment to the Companies Act was to establish Special Courts exclusively for trying offenses under the Companies Act, with a composition comprising Sessions Judge or an Additional Sessions Judge. They argued that this amendment should be given effect to ensure uniformity and coherence in the trial of offenses. Furthermore, the respondent contended that since the offenses under the Code were distinct from those under the Companies Act, they should not be subject to the jurisdiction of the Special Court established under Chapter XXVIII of the Companies Act, especially considering the specific provisions introduced by the 2018 amendment. In summary, the respondent’s contentions centered around the interpretation of the provisions of the CrPC in light of subsequent amendments to the Companies Act, arguing for a coherent and uniform approach in the trial of offenses under both statutes.

COURT’S ANALYSIS AND JUDGEMENT

The court conducted a thorough analysis of the legal provisions concerning the trial of offenses under the Companies Act, 2013, as outlined in Section 236(1) of the Code of Criminal Procedure (CrPC). It noted that the provision specifically mandated that offenses under the Code shall be tried by the Special Court established under Chapter XXVIII of the Companies Act, 2013. The court observed that the reference in Section 236(1) of the CrPC was specific rather than general. It pointed out that the provision only referred to the trial of offenses under the Code by the Special Court established under Chapter XXVIII of the Companies Act, without any broader application to offenses under other statutes.

Based on the principle of legislation by incorporation, the court held that the provision in Section 236(1) of the CrPC was effectively lifted from Section 435 of the Companies Act, 2013 and incorporated into the former. Therefore, any subsequent amendments to Section 435 of the Companies Act would not affect the provisions of Section 236(1) of the CrPC. The court noted that although the Companies Act underwent subsequent amendments in 2015 and 2018, which altered the composition of the Special Court, these amendments did not impact the provisions of Section 236(1) of the CrPC. It emphasized that the legislative intent behind the amendment to the Companies Act was not reflected in Section 236(1) of the CrPC. Furthermore, the court held that offenses under the Code, regardless of subsequent amendments to the Companies Act, should continue to be tried by the Special Court established under Chapter XXVIII of the Companies Act, as mandated by Section 236(1) of the CrPC.

In conclusion, the court allowed the appeal, quashed the impugned judgment of the High Court, and held that the Special Court presided by a Sessions Judge or an Additional Sessions Judge would have jurisdiction to try offenses under the Code. However, since the High Court did not consider the merits of the case, the matter was remitted to the High Court for fresh consideration on its merits. This judgment reaffirmed the interpretation of Section 236(1) of the CrPC and upheld the jurisdiction of the Special Court established under Chapter XXVIII of the Companies Act for trying offenses under the Code.

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Judgement Reviewed by- Shruti Gattani

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