Supreme Court Judgment - The Legal Chamber

Supreme Court Upholds MSMED Act’s Supremacy, Rejects Bengaluru Arbitration Clause : “MSMED Act Overrides Arbitration Agreements”

19May

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Upholds MSMED Act’s Supremacy, Rejects Bengaluru Arbitration Clause : “MSMED Act Overrides Arbitration Agreements”

The Supreme Court ruled that the Micro, Small and Medium Enterprises (MSMED) Act, 2006 overrides arbitration agreements under the Arbitration and Conciliation Act, 1996, affirming its special law status. It held that the supplier’s location determines arbitration jurisdiction, disregarding contractual seat clauses. The judgment reinforces statutory protection for MSMEs, ensuring disputes proceed before designated Facilitation Councils as per Section 18(4). Facts Of The Case: The dispute arose from a construction contract between M/s Harcharan Dass Gupta (Appellant), an MSME-registered supplier, and ISRO (Respondent), following a 2017 tender for staff quarters in Delhi. The agreement included an arbitration clause designating Bengaluru as the seat. When conflicts emerged, the supplier app...

Govt Can Impose Conditions on Land Allotments to Charitable Trusts : Supreme Court on Land Allotment vs. Sale

19May

By The Legal ChamberNo Comments

Supreme Court

Govt Can Impose Conditions on Land Allotments to Charitable Trusts : Supreme Court on Land Allotment vs. Sale

The Supreme Court ruled that government land allotments to charitable trusts under statutory schemes are not absolute sales, allowing the State to impose usage conditions. It held that Section 10 of the Transfer of Property Act (restricting alienation conditions) does not apply to such allotments, as public interest overrides private contractual principles. The Court emphasized that violation of allotment terms (e.g., unauthorized commercial use) justifies land resumption without compensation, branding such breaches as "fraud on statute". The judgment reaffirmed the State’s authority to enforce conditional grants for charitable purposes under revenue laws. Facts Of The Case: The case involved a dispute over 3.01 acres of government land in Telangana allotted to Dr. Pasupuleti Nirmala Han...

Supreme Court Decides “what It Means for Future Agreements” : Lead Partner Liable for Full Payment in Power Project Dispute

19May

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Decides “what It Means for Future Agreements” : Lead Partner Liable for Full Payment in Power Project Dispute

The Supreme Court upheld the doctrine of privity of contract, ruling that Brua Hydrowatt Pvt. Ltd. (BHP) was solely liable for transmission bay costs under its agreement with HP Power Transmission Corporation (HPPTC), despite internal arrangements with third parties. The Court held that non-signatories (Respondent Nos. 2 & 3) could not be bound by the contract, reversing APTEL’s order. The judgment reaffirmed that contractual obligations apply only to parties to the agreement, unless explicitly extended. Facts Of The Case: The dispute arose between HP Power Transmission Corporation Ltd. (HPPTC) and M/s Brua Hydrowatt Pvt. Ltd. (BHP) over the liability for construction and maintenance costs of a 66kV power transmission bay at Urni, Himachal Pradesh. BHP, along with two other power com...

“Courts Can’t Decide Arbitrability” Supreme Court Clarifies Arbitrator Appointment Scope Under Section 11 Arbitration Act

17May

By The Legal ChamberNo Comments

Supreme Court

“Courts Can’t Decide Arbitrability” Supreme Court Clarifies Arbitrator Appointment Scope Under Section 11 Arbitration Act

The Supreme Court ruled that under Section 11(6A) of the Arbitration Act, courts must limit their examination to the existence of an arbitration agreement and cannot decide arbitrability or exclude claims as "excepted matters" at the appointment stage. Citing the 7-judge bench in In Re: Interplay and 3-judge bench in SBI General Insurance, it held that arbitral tribunals—not courts—must determine whether claims fall under non-arbitrable categories. The judgment clarifies that courts cannot bifurcate claims into arbitrable/non-arbitrable during arbitrator appointments, ensuring minimal judicial interference at the referral stage. Facts Of The Case: The dispute arose from a contractual agreement between Office for Alternative Architecture (Appellant) and IRCON Infrastructure (Respondent), ...

“Masterminds Can’t Claim Parity with Minor Accused”: Supreme Court Overrules Bail Order under 302 IPC

17May

By The Legal ChamberNo Comments

Supreme Court

“Masterminds Can’t Claim Parity with Minor Accused”: Supreme Court Overrules Bail Order under 302 IPC

The Supreme Court ruled that bail parity cannot be mechanically applied when material distinctions exist between accused persons. It held that alleged conspirators/masterminds of a serious crime (Section 302 IPC) cannot claim bail parity with minor co-accused, especially when evidence suggests their active role in hiring a contract killer. The Court emphasized that bail decisions must consider the gravity of allegations, evidentiary role of each accused, and potential witness intimidation, rather than granting parity as a blanket rule. The judgment clarified that "parity" under Section 439 CrPC requires comparable roles, not mere similarity of charges. Facts Of The Case: The case involves a brutal shooting during a marriage procession in Rajasthan on November 28, 2023. The prosecution al...

Supreme Court Clarifies Section 195 CrPC Doesn’t Protect Post-Proceeding Forgery”: Courts Records Safety

17May

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Clarifies Section 195 CrPC Doesn’t Protect Post-Proceeding Forgery”: Courts Records Safety

The Supreme Court ruled that Section 195 CrPC does not bar prosecution for tampering with court records after proceedings conclude, as such acts no longer affect "proceedings in court" under Section 195(1)(b). It held that fabricating documents in record rooms post-withdrawal constitutes standalone offences under IPC, not requiring court-sanctioned complaints. The judgment clarified that Section 195 applies only when offences directly impact live judicial proceedings or documents in active court custody, distinguishing between administrative record-keeping and judicial administration of justice. The Court affirmed that FIRs remain valid for post-proceeding forgeries. Facts Of The Case: The case originated from a 2005 FIR lodged by the Registrar of Bharuch District Court against Parshotta...

Supreme Court Rejects Delay Condonation in Property Dispute: No Second Chance for Delay “Limitation Act”

17May

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Rejects Delay Condonation in Property Dispute: No Second Chance for Delay “Limitation Act”

The Supreme Court ruled that repeated applications for condonation of delay under different procedural provisions (Order IX Rule 13 and Order XLI Rule 3A CPC) cannot be entertained when the same grounds were already rejected in earlier rounds. Emphasizing strict adherence to limitation laws, the Court held that finality of judicial orders must prevail over belated challenges, and litigants cannot abuse process by re-agitating identical delay explanations. The judgment reaffirmed that Section 14 of the Limitation Act doesn’t apply where prior delay condonation pleas were dismissed on merits. Facts Of The Case: The dispute arose from a 2015 sale agreement between the appellant (Thirunagalingam) and respondent No. 1 (Lingeswaran) concerning property in Nainarkoil village. When the responden...

Railway Guards’ Seniority Dispute: Supreme Court Upholds Seniority Rules for Surplus Railway Employees

1May

By The Legal ChamberNo Comments

Supreme Court

Railway Guards’ Seniority Dispute: Supreme Court Upholds Seniority Rules for Surplus Railway Employees

The Supreme Court upheld the Railway Board's policy under Paragraph 313A of the Indian Railway Establishment Manual, 1989, ruling that surplus employees absorbed in a new division lose past service benefits for seniority and are treated as fresh entrants. Those who voluntarily opted for transfer were also placed at the bottom of the recruitment grade, affirming the Tribunal and High Court's decisions. The Court rejected arguments challenging the retrospective application of the circular, clarifying that redeployed staff cannot claim seniority based on prior service. Facts Of The Case: The case involved railway employees (guards and senior guards) from Bhavnagar Division of Western Railway who were affected by operational changes due to the conversion of meter gauge to broad g...