The Supreme Court Re-defines The Interim Order That Maintains A Delicate Balance Between Justice, Efficiency, And Fairness Under The Prevention Of Corruption Act.

Case title:

High Court Bar Association, Allahabad V State of U.P. & Ors

Date of Order:

FEBRUARY 29, 2024. 

Bench:

Humbly submitted before the Hon’ble SUPREME COURT OF INDIA. Hon’ble Judge Dr Dhananjaya Y. Chandrachud (CJI); J Mr. Pankaj Mithal.; J. Abhay S. Oka; J.B. Pardiwala; J. Manoj Misra.

Parties:

Appellant: High Court Bar Association

Respondents:. State of U.P. & Ors

Subject:  

The Supreme Court in a criminal appeal, addressed the High Court's interference in framing of charges under the Prevention of Corruption Act of 1998. It was clarified that the charges implied were merely interlocutory nor were they final. It emphasized that the interim stays should be granted with judicial discretion and not with a lapse in an automatic way. The guidelines for the same were set in which a limit of max 6 months was decided with a speaking order. The idea of automatic expiration of order was thus referred to as arbitrary. It was stressed that to pass an order, there has to be a presence of judicial mind along with its conditions.

IMPORTANT PROVISIONS

[CONSTITUTION OF INDIA]

• ARTICLE 14 & 21: The right to have equality and the Right to life and personal liberty play an imperative role as these are deriving sources in delivering the decisions related to fundamental rights etc. 
• ARTICLE 32: provides constitutional remedies to seek jurisdiction and file writs to enforce fundamental rights.
• ARTICLE 142 Grants power to the Apex Court to do complete Justice.
• ARTICLE 226: Grants the High Court to issue writs.
• ARTICLE 227: Grants the High Court the power to superintend over the lower courts.

OVERVIEW(Brief Facts)

• The case deals with the scope of interference of the High Court regarding an order for framing charges, that was passed by a special judge under the provisions of the Prevention of Corruption Act of 1998.
• This case revolves around the decision in a private company( Asian Resurfacing of Road Agency Pvt Ltd) vs CBI, where the Supreme Court was to decide whether the issue of framing of charges was interlocutory.
• It was later referred to a larger bench to decide whether the decision made in the case of Magan Lal Thacker v State of Gujarat was apt or not. The three-judge bench decided that the order was neither interlocutory in nature nor was it a final one.
• The bench, moved ahead with the further cases where a stay was granted especially in the cases related to criminal trials under the PC ACT.
• It was also found that the issue of automatic vacation of stay proceedings caused a significant injustice to the parties due to this delay.
   

ISSUES RAISED

The core issues that were raised in this case were related to:

• The main issue raised was whether the order framing charge under the PC Act was interlocutory.
• The issue also revolved around the question, of whether the High Court had the power to stay the proceeds of trial under the PC Act.
• The duration of the interim passed should be a maximum of what time and when it ought to be passed.

ARGUMENTS ADVANCED BY THE APPELLANT

• The appellants contended that the main reason for filing this petition was due to the judicial legislation made regarding the interim order (which is like the judicial legislation). Courts as per the rules cannot engage in judicial legislations.
• It was inferred that Article 226 is the basic part of the Constitution but can be whittled down by the exercise of powers under Articles 141 and 142.
• Also, it was put forward that the High Court derives its powers from the Constitution and is not subordinate to any other courts.
• It was emphasized that the decision of interim order should be initially short-lived and should be only given with the application of judicial mind.
• It was also put forward referring to one of the precedents that there should be no cap in fixing the time to decide when a trial should be completed.
• Additionally, under Article 226(3), only under special (specific) application an interim order cannot be automatically vacated.
• Referring to one of the provisions of section 254(2A) of Income tax,1961 it was stated that if an appeal is not disposed of within 365 days before the appellate tribunal they shall stand vacated.
• In the end it was adhered to that this automatic vacation of interim relief is unjust, unfair, and unreasonable.
• The other counsel appearing on behalf of Gauhati High Court Bar Association, stated that 

ARGUMENTS ADVANCED BY THE RESPONDENT

• The arguments made by the respondents were that laws regarding the aforementioned procedure are based on the natural principles of justice, whose main requirement is that it is discussed in the presence of the person and not in their absence.
• If a legal provision requires an institution to perform a particular task within a given time frame and in case there is noncompliance, the responsibility would fall on someone who has no control over the institution.
•  It was emphasized that the interim order is passed based on 3 conditions that are prima facie, the balance of convenience, and irreparable injury to the aggrieved party.
• It was held that speedy justice is important but the element of fairness is important too. Article 142 of the Constitution of India has the power, where discretion conferred upon the High Court cannot be taken away.

JUDGEMENT ANALYSIS 

• Based on the arguments of both sides the Court analyzed that for giving interim relief, is granted when the High Court is dealing with a challenge to interim or interlocutory order which may be passed during the pendency of the that was held before the appellate/trial court before.
• It was also stated that even though the 3 essential conditions of prima facie, the balance of convenience and irreparable injury to the aggrieved party are not mentioned, they are always in the judge's mind.
• The court acknowledged that even though the court passes the judgment of interim with restraint, it necessarily does not mean the order is passed only in exceptional cases.
• Further it was stated, that the court shall remain cautious while granting a stay in cases under the PC Act, offenses against women or children, etc.
• It was implied that if the pending case does not stay, the trial court may decide a case that was pending making the remedied outcomes ineffective. (This was referred to as an Order of REMAND, which would potentially cause a delay and the costs of litigation).
• It was further analyzed that the High Court can only order a stay after giving the contestants a chance to present before the court, if it is not done it is referred to as ad-interim order of stay. (This could be converted to an interim order only if the contestants are heard).
• The basis on which the High Court can vacate/modify the case was also recognized: if the proceedings are deliberately prolonged by means like adjournment etc; if the relief is granted due to the result of either misrepresentation of material facts or so.
• It was stated these grounds are not exhaustive. There could be other accounts for vacating the order of stay.
• Moving ahead, it was stated that the interim order may end when the High Court disposes it based on merits/defaults/abatement of the case or by means of a judicial order of vacating interim relief.
• It was implied that the principles of natural justice have to be the basis of these orders/judgments and any order related to vacating interim relief or modification of the interim relief is passed only after all the affected parties are heard. (The essential basis applied here was that the application of the Judicial mind is necessary for the same).
• Referring to the case of Asian resurfacing, it was added that the automatic vacation of the interim period contradicts the concept of fairness, and the maxim ‘actus curiae neminem gravabit’ is applied. This basically means that the action of the court should not prejudice anyone due to its decisions.
• It was clarified that a fixture of date should happen immediately after the passage of a month due rather than awaiting orders. (This indirectly favours the respondents and affects the rights of litigants according to Articles 226 & 227).
• It was found by the court that the reference made regarding Section 254 (2A) of the IT Act, which stayed void after 365 days, if not heard was termed to be violative of Article 14.
• The section of the act was termed arbitrary and discriminatory.
• Pointing to the powers of the court it was mentioned that the court by means o article 142 which is curative cannot be constructed as a basis to ignore the right of a litigant, especially when he/she is dealing with a cause(case) that is due.
• It was emphasized that the court may have the powers under Article 142, but it cannot violate any statutory provisions.
• But it was clarified that the powers under the Article could be drawn to serve justice without violating the right of a litigant or defying the principles of natural justice.
• Regarding the derivation of powers it was mentioned that greater judicial powers are vested in the ambit of the High Court as it has the power to issue writs as per Article 226 of the Constitution of India, for enforcement of the fundamental rights.
• It was also stated that as per Article 227 of the Constitution of India, the High Court exercises its powers over the subordinate courts. The same power of superintendence is not mentioned in the case of the Apex and the High Court. The two courts are like brothers, whereas the Apex court is the elder one. (Based on different factors like, it is the final interpreter of the law and making decisions, etc.).
• In the further context, while referring to the opined arguments of the appellants it was considered that the court can direct to automatic vacation which ultimates to judicial legislation, but the court cannot practice judicial legislation.
• It was acknowledged that High Courts are under a huge workload and are flooded with writ petitions under Article 227, other provisions of CrPC, matrimonial disputes, etc. Hence, it cannot be expected to decide a case on a priority basis, the cases in which stay proceedings are granted keeping aside the other categories may be prioritized. Similarly, the conditions of the subordinate courts are even worse.
• It was later explicitly implied that a court like the High Court should not fix a time cap for disposing of the case. Rather a priority could be criteria in deciding a case based on the backlogs/workload of the case.
• It was strongly stated that there may be a financial constraint for the litigants to afford proceedings at different junctures. Therefore, courts should refrain from interfering from day to day functioning of other courts.
• Regarding the interim orders, there should be a limit on interim relief duration. The reasons for the same might not be elaborated but should be relevant to consider while granting.
• The Court(Apex) disagreed with the fact that the relief automatically expires after a certain extent and Article 142 does not allow for automation of vacating the interim orders.
• Hence, orders based on the precedent judgments like in the case of Asian Resurfacing, which was regarding automatic vacation of the interim relief, stayed valid.
• Furthermore, it was added that if a stay is granted on an order of framing charges the matter should be decided on a day-to-day basis.
• These stays should be for 2-3 months in general, not exceeding six months. If crossed, it would stand invalid.
•  It was stated that Asian Resurfacing’s approach under Article 142 matches Article 226(3), which would mandate the court to decide on the vacation of interim within 14 days(2 weeks)
• It was strongly adhered to that a party should not suffer due to the delays of court, and these interim orders have to be passed in speaking orders along with vacation orders so that with a practical approach seeking justice does not lead to injustice in any way.

CONCLUSION

The Apex court held in the criminal appeal, clarifying the nature that framing of charge should have under the PC Act. It was also pressed on what powers the other courts like the High Court have in granting an interim stay. The concept of judicial discretion in granting of stays was pressed onto. Whereas, the concept of automatic expiration of the reliefs was condemned. The guidelines for the same were provided, emphasizing the principles of natural justice which ensured timely justice without any prejudice.