All India Institute of Medical Sciences …Appellant Versus Sanjiv Chaturvedi & Ors. …Respondents

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REPORTABLE
THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
 CIVILAPPEAL NO. 1392 OF 2019
(@ SLP(C) NO. 27490 OF 2018)
All India Institute of Medical Sciences …Appellant
Versus
Sanjiv Chaturvedi & Ors. …Respondents
J U D G M E N T
Indira Banerjee, J.
Leave granted.
2. This appeal is against the final judgment and order dated
21.08.2018 passed by a Division Bench of the High Court of
Uttarakhand at Nainital allowing the writ petition being WPSB
No.359 of 2018 filed by the respondent no.1 and quashing the
order dated 18.09.2017 passed by the Chairman of the Central
Administrative Tribunal (hereinafter referred to as “CAT”) at the
Principal Bench at Delhi, inter alia, staying proceedings in OA
331/00790/ 2017 filed by the respondent no.1 and pending
before a Division Bench of CAT at Nainital.
3. The respondent no.1, an Indian Forest service officer of the
Uttarakhand cadre of 2002 Batch was posted as Deputy
2
Secretary at the All India Institute of Medical Sciences, New
Delhi from 29.6.2012 till 28.6.2016.
4. The said post of Deputy Secretary was created with the
approval of the Department of Expenditure, inter alia, to
coordinate and manage infrastructure projects and ensure their
timely completion, to exercise management and control of the
Institute and to coordinate with Multi Disciplinary Experts.
5. At its 195th meeting held on 20.7.2010, the Standing
Finance Committee of the Institute decided against the creation
of a new post of Central Vigilance Officer and resolved that the
work of Central Vigilance Officer should also be assigned to the
officer, joining the newly created post of Deputy Secretary of
AIIMS. The Governing Body and Institute body of AIIMS headed
by the Union Health Minister ratified the decision of the
Standing Finance Committee.
6. An order dated 23.6.2011 was issued by the Ministry of
Health and Family Welfare enumerating the duties pertaining to
the said post of Deputy Secretary of AIIMS.
7. As stated above, respondent no.1 was appointed Deputy
Secretary of AIIMS on 29.6.2012. As per the work allocation
order the respondent no.1 was also made Central Vigilance
Officer of the AIIMS.
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8. It is the case of the respondent no.1 that the work of the
General Section was withdrawn from the respondent no.1 in
November 2012, the work of Central Vigilance Officer was
withdrawn from him in August 2014, the work of dealing with
grievances was withdrawn from him some time in 2015 and in
December 2015 the work of the Estate Section was withdrawn
from him. Ultimately the respondent no.1 was left practically
without any work, apart from signing pension papers and
booking guest houses.
9. According to the respondent no.1, there was delay in
completion of infrastructure projects, which along with the way
in which the respondent no.1 had been denuded of duties by
successive office orders, attracted severe criticism in a report
of the Parliamentary Committee.
10. According to the respondent no.1, at the time when he
was assigned the work of Central Vigilance Officer, the then
Health Secretary had commented on his “exemplary
performance” and “absolute integrity”. Moreover, the
respondent no.1 was, in his Annual Performance Appraisal
Reports for the years 2012-13 and 2013-14 graded as
‘outstanding’, with the following remarks by the then Union
Health Minister “Shri Sanjiv Chaturvedi, Deputy Secretary and
CVO, AIIMS, New Delhi, is a man of integrity, sincerity, who is
keen on performing his assigned role to the best of his ability
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and knowledge without fear or favour”.
11. The respondent no.1 had been awarded the Ramon
Magsaysay Award for the year 2015 in recognition of his
exemplary integrity, courage and tenacity, inter alia, in
uncompromisingly exposing and painstakingly investigating
corruption in public office. Records reveal that the respondent
no.1 had donated the award money of Rs.14,23,000/- to the
Prime Minister’s Relief Fund after the All India Institute of
Medical Sciences refused to accept his donation of the award
money to the All India Institute of Medical Sciences for free
treatment of under privileged patients.
12. According to the respondent no.1, no complaint of any
kind was received against him from any employee during his
two year tenure as Central Vigilance Officer of the Institute.
However, the very same persons, who had earlier showered
praises on the respondent no.1 turned against him for
extraneous reasons, particularly his role in exposing
corruption.
13. Being aggrieved, the respondent no.1 filed an application
being O.A. No.1887 of 2015 before the Principal Bench of the
CAT at Delhi, inter alia, for directions on the concerned
authorities to allocate the work of Deputy Secretary to the
respondent no.1. The said application has been dismissed by
a judgment and order dated 17.5.2016.
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14. The respondent no.1 has alleged that the duties of Central
Vigilance Officer were withdrawn from him as he had unearthed
irregularities and corruption in infrastructure projects. The
nature or reasons for the disputes between the respondent no.1
and the appellant are not relevant to the issues involved in this
appeal.
15. A memorandum dated 7.1.2016 was served on the
respondent no.1, informing him that the Director of the All
India Institute of Medical Sciences had placed on record his
displeasure with insubordination, indiscipline and lack of work
ethics of the respondent no.1 during the Winter Session of
Parliament in the year 2015, and directed that a copy of the
said memorandum be kept in the personal file of the
respondent no.1. A representation made by the respondent
no.1 against the aforesaid memorandum was rejected by the
Competent Authority.
16. Being aggrieved, the respondent no.1 filed OA No.1342 of
2016 before the Principal Bench of the CAT at New Delhi
challenging the said Memorandum dated 7.1.2016 and praying
for orders, restraining the Director of the All India Institute of
Medical Sciences from writing the Annual Performance
Appraisal Report of the respondent no.1. The said application is
pending. On the application being filed, the learned Tribunal
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directed issuance of notices, but declined the prayer of the
respondent no.1 for interim relief.
17. On 28.6.2016, the four year deputation of the respondent
no.1 as Deputy Secretary at AIIMS came to an end, and he
joined his new post at Uttarakhand in August, 2016, after
availing leave of two months.
18. By an order dated 11.1.2017 AIIMS communicated an
adverse Annual Confidential Report for the year 2015 -2016 to
the respondent no.1 wherein he had uniformly been given
‘Zero’ grading in all attributes. On 23.1.2017, the respondent
no.1 filed an appeal against the order dated 11.1.2017 before
the Competent Authority. The appeal was rejected by an order
dated 15/20.4.2017.
19. On 19.6.2017, the respondent no.1 filed a writ petition
being WPSB No.225 of 2017 before the Uttarakhand High Court
challenging the orders dated 11.1.2017 and 15/20.4.2017. The
respondent no.1 also filed an application being PT No.286/2017
in OA No. 1342/2016 before the Principal Bench of the CAT at
Delhi for transfer of OA No. 1342/2016 from the Principal
Bench of the CAT at Delhi to its Bench at Nainital. The
appellant has filed a counter affidavit to the said application.
20. By an order dated 19.6.2017 in the writ petition being
WPSB No.225 of 2017, the Division Bench of Uttarakhand High
Court relegated the respondent no.1 to approach the Tribunal
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under the Administrative Tribunals Act, 1985 (for short ‘the
Act’) and to seek all reliefs available to him. The respondent
no.1 was given the liberty to approach the High Court in the
event any relief prayed for by the respondent was rejected by
the Tribunal.
21. Thereafter, the respondent no.1 instituted an application
being OA No.331/00790/2017 before the Nainital Bench of the
CAT challenging the Annual Performance Appraisal Report
(APAR) of the year 2015-16 whereupon an interim order was
passed in favour of the respondent no.1 on 18.9.2017, by a
Division Bench of the Tribunal, the operative part whereof is set
out hereinbelow:-
“Matter be posted for further hearing on interim
relief on 03.10.2017. Respondents shall file their
reply before the said date. In the meantime, in the
interest of justice, it is directed that if any matter
related to the career progression of the applicant
comes up for consideration before the terms of the
impugned orders shall not be taken into account
while assessing and the applicant’s suitability or
fitness and he shall be considered on the basis of
the rest of his ACRs/APARs.
22. The Union of India filed an application before the Chairman
of the Tribunal being PT 316 /2017 seeking transfer of OA No.
331/00790/2017 to the Principal Bench at Delhi. By an ex
parte order dated 18.9.2017 passed in the said transfer
application, the Chairman of the CAT, sitting singly, stayed
proceedings in OA No.331/00790/2017 pending before a two
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member Bench at Nainital for a period of six weeks, and
directed that notice be issued to the respondent no.1.
23. Challenging the aforesaid order on the ground that the
Chairman of CAT, sitting singly, could not have stayed
proceedings pending before a Division Bench, the respondent
no.1 filed a writ petition being W.P.(SB) No. 259/2018 in the
High Court of Uttarakhand at Nainital.
24. By the impugned order dated 21.8.2018, which is under
appeal, the High Court allowed the writ petition and set aside
the impugned order dated 18.9.2017 of the Chairman,
observing that the Chairman of the Tribunal, while sitting
singly, could not stay the proceedings pending before the
Division Bench. The High Court imposed costs of Rs.25,000/- on
the appellant.
25. Learned counsel appearing on behalf of the appellant
submitted that the impugned order was passed without giving
the appellant an opportunity of hearing. No Vakalatnama was
executed by the appellant authorizing the learned Additional
Solicitor General of India Shri Rakesh Thapliyal to appear before
the High Court on behalf of AIIMS.
26. Learned Counsel for the appellant next submitted that the
High Court had erred in holding that the Chairman of CAT,
sitting singly, could not stay proceeding before the Division
Bench. He argued that a conjoint reading of the preamble of
9
the Act with Section 5(2), 5(6), the proviso to Section 24 and
Section 25 of the said Act, shows that the Chairman sitting
singly can stay proceedings before any other Bench. Such
power has been conferred upon the Chairman under Section
5(6) read with Section 25 of the Act.
27. Learned counsel submitted that it was necessary for the
Chairman to pass an order of stay of proceedings in O.A.
No.331/790/2017 pending before the Bench at Nainital to avoid
multiplicity of proceedings and for judicial uniformity, more so,
since the lis in OA No.1342 of 2016 before the Principal Bench
and in O.A. No. 331/790/2017 at the Bench at Nainital were
similar. The subject matter of both the applications related to
the APAR of the year 2015-2016.
28. In support of his submission, that the Chairman of the
CAT, considering an application for transfer under Section 25 of
the Act, had the power to stay the proceedings before the
Nainital Bench, of which transfer had been sought, counsel
cited Dr. Mahabal Ram vs. Indian Council of Agricultural
Research and others
1
 and L. Chandra Kumar vs. Union of
India & Ors.
2
.
29. Counsel appearing on behalf of the respondent no.1
refuted the submission that the appellant had not been heard
by the High Court, arguing that the appellant had duly been
1 (1994) 2 SCC 401
2 (1997) 3 SCC 261
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represented by Shri Rakesh Thapliyal, Additional Solicitor
General of India. He submitted that, as per the rules of the
High Court an advance copy of the writ petition had also been
served on the Additional Solicitor General Shri Rakesh
Thapliyal. The Additional Solicitor General and senior
government counsel had been representing both Union of India
and AIIMS in the High Court as well as in Nainital Bench of CAT
where the Union of India and AIIMS had jointly filed reply
through counsel for Union of India.
30. Counsel appearing for the Respondent no.1 emphatically
argued that the Chairman of CAT sitting singly had no power
under the Act to stay the proceedings in a part-heard matter
before a Division Bench of the same Tribunal. It was trite that
a body created by statute could only have those powers
provided by statute and nothing more.
31. Counsel for the respondent no.1 further argued that the
appellant had filed O.A No.331/790 of 2017 pursuant to the
order of the Division Bench of the High Court, in the writ
petition filed by the respondent no.1, being WPSB No.225 of
2017. The order of the Chairman was, thus, in violation of the
order of the Division Bench of the High Court.
32. Counsel appearing for the respondent no.1 also submitted
that under Section 24 of the Act, the maximum duration of an
ex-parte interim order could be two weeks and that too subject
11
to certain conditions, including service of advance copy, which
had not been done in this case. Moreover, there had to be a
prima facie finding that the appellant would suffer irreparable
loss, which could not be monetarily compensated, if no interim
order were passed. In this case, the Chairman passed a nonspeaking interim order for six weeks. The order does not
disclose any urgency or irreparable loss which could not be
monetarily compensated.
33. Counsel for the respondent no.1 also submitted that the
cause of action in OA No. 331/790/2017 was distinct from cause
of action in OA No. 1342/2016. The communication of adverse
APAR for the year 2015-16 gave rise to a fresh cause of action.
Unless challenged, the APAR would have led to adverse
consequences for the respondent no.1, such as, denial of
promotion.
34. Counsel for the respondent no.1 submitted that OA No.
1342/2016 and OA No. 331/790/2017 arose as a result of two
completely different orders and, in any case, the issue of
whether there was similarity of cause of action in the two
proceedings had been dealt with by the Nainital Bench. The
finding of the Nainital Bench had never been challenged by the
appellant and had attained finality.
35. Relying on the judgment of this Court in Ramrameshwari
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Devi and Ors. v. Nirmala Devi & Ors.
3
, Counsel for the
respondent no.1 submitted that the High Court had rightly
imposed a fine on the appellant, as the appellant had obtained
an ex parte order by misrepresentation.
36. Counsel for the respondent no.1 finally submitted that this
appeal might be dismissed, as it is purely based on perjury and
concealment of facts, citing Kishorbhai Gandubhai Pethani
v. State of Gujarat & Anr.
4
, Kishore Samrite V. State of
Uttar Pradesh & Ors.
5
 and Prestige Lights Ltd. v. State
Bank of India
6
.
37. It is not in dispute that the impugned order, under
challenge in this Court, records the appearance of Shri Rakesh
Thapliyal, Additional Solicitor General on behalf of AIIMS as
well. Any objection with regard to erroneous recording of
appearances, or the authority of the learned Additional Solicitor
General of India to represent the AIIMS ought to have been
urged before the High Court by making an appropriate
application. The objection to the appearances of the Additional
Solicitor General, representing the Central government in the
same proceedings, is prima facie preposterous, considering
that the AIIMS is under full control of the Central Government.
It is, however, not for this Court to examine whether the
3 (2011) 8 SCC 249
4 (2014) 13 SCC 539
5 (2013) 2 SCC 398
6 (2007) 8 SCC 449
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learned Additional Solicitor General of India had been
authorized to appear before the High Court on behalf of AIIMS
or not.
38. The judgments of this Court in Munna Lal Karosia vs.
State of Madhya Pradesh and Others
7 and Association of
Synthetic Fibre Industries vs. Apollo Tyres Limited and
Others
8
, cited by the appellant to argue that a final order
ought not be passed by the High Court against any person
without giving that person an opportunity of hearing, have no
application in the facts and circumstances of this case, since
the appellant had apparently been represented by the
Additional Solicitor General. The judgments were rendered in
the particular facts and circumstances of those cases.
39. In Munna Lal Karosia (supra), the High Court had held
Munna Lal Karosia to be guilty of contempt without hearing
him. It was in the aforesaid context that this Court deprecated
the passing of stigmatic orders against a person without giving
that person an opportunity of hearing. An order of contempt
may be stigmatic. The order under appeal is not so. Imposition
of costs does render an order stigmatic, as sought to be argued
on behalf of the appellant.
40. The main question before this Court is, whether the
Chairman of the Tribunal, sitting singly and exercising his power
7 (2012) 12 SCC 255
8 (2010) 13 SCC 735
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under Section 25 of the Act, to transfer proceedings from one
Bench to another, could have stayed proceedings before a two
member Bench and rendered interim orders passed by that
Bench inoperative. The answer to the aforesaid question has to
be in the negative for the reasons discussed hereinafter.
41. The Act has been enacted in pursuance of Article 323 A,
inserted into the Constitution of India by the Constitution (42nd
Amendment) Act, 1976, which enables Parliament to enact law
to provide for adjudication and/or trial by Administrative
Tribunals of disputes in respect of recruitment and conditions of
service of persons in public services and posts inter alia in
connection with the Union of India and authorities under its
control.
42. As observed by the Supreme Court in Vatticherukuru
Village Panchayat v. Nori Venkatarama Deekshithulu
and Ors.
9
, the Parliament has enacted Article 323A for the
reason that the Civil Courts, gripped with rules of pleading and
strict rules of evidence and tardy trial, four-tier appeals,
endless revisions and reviews under the Civil Procedure Code,
are not suited to the need for expeditious dispensation of
litigation relating to services.
43. CAT has been established under Section 4 of the Act and
exercises jurisdiction, powers and authority as stipulated in
9 (1991) Supp. (2) SCC 228
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Section 14 of the Act.
44. Under Section 14(1) read with 14(3) of the Act, CAT
exercises all the jurisdiction authority and powers, exercised by
all Courts except the Supreme Court before the establishment
of a Tribunal under the Act.
45. Even though the Evidence Act and Civil Procedure Code
may not apply to Tribunals constituted in pursuance of Article
323 A of the Constitution, such Tribunals, like ordinary law
courts are bound by rules of evidence and procedure as laid
down under the law under which the Tribunal is constituted
and/or the rules and regulations framed thereunder and are
required to determine the lis brought before them strictly in
accordance with the law.
46. The preamble to the Act states the object of the Act,
which is to provide for adjudication or trial by Administrative
Tribunals, of disputes and complaints in respect of recruitment
and conditions of service of persons appointed to public
services and posts in connection with the affairs of the Union or
of any State or of any local or other authority within the
territory of India or under the control of the Government of
India or of any corporation owned or controlled by the
Government, in pursuance of Article 323A of the Constitution of
India and for the matters connected therewith or incidental
thereto.
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47. The reference by Counsel for the appellant to the
Preamble of the Act is of no relevance. The respondent no.1
approached the Tribunal for redressal of his grievances. His
case was heard by a Division Bench and a reasoned interim
order passed on 18.9.2017. The preamble, which states the
aims and objects of the Act is of no assistance to the appellant,
as it does not lend support to appellant’s contention that the
Chairman of the Tribunal sitting singly could have stayed
further proceedings before a Division Bench. The reliance
placed by Counsel on the Preamble is misconceived.
48. Sections 5, 24 and 25 of the Act provide as follows:-
5. Composition of Tribunals and Benches thereof.—
(1) Each Tribunal shall consist of a Chairman and such
number of Judicial and Administrative Members as the
appropriate Government may deem fit and, subject to the
other provisions of this Act, the jurisdiction, powers and
authority of the Tribunal may be exercised by Benches
thereof.
(2) Subject to the other provisions of this Act, a Bench
shall consist of one Judicial Member and one
Administrative Member.
(3) Omitted
(4) Notwithstanding anything contained in sub-section (1),
the Chairman—
(a) may, in addition to discharging the functions of the
Judicial Member or the Administrative Member of the
Bench to which he is appointed, discharge the functions of
the Judicial Member or, as the case may be, the
Administrative Member, of any other Bench;
(b) may transfer a Member from one Bench to another
Bench;
(c) may authorise the Judicial Member or the
Administrative Member appointed to one Bench to
discharge also the functions of the Judicial Member or the
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Administrative Member, as the case may be, of another
Bench; and
(d) may, for the purpose of securing that any case or
cases which, having regard to the nature of the questions
involved, requires or require, in his opinion or under the
rules made by the Central Government in this behalf, to
be decided by a Bench composed of more than two
Members issue such general or special orders, as he may
deem fit:
Provided that every Bench constituted in pursuance of this
clause shall include at least one Judicial Member and one
Administrative Member.
(6) Notwithstanding anything contained in the foregoing
provisions of this section, it shall be competent for the
Chairman or any other Member authorised by the
Chairman in this behalf to function as a Bench consisting
of a single Member and exercise the jurisdiction, powers
and authority of the Tribunal in respect of such classes of
cases or such matters pertaining to such classes of cases
as the Chairman may by general or special order specify:
Provided that if at any stage of the hearing of any such
case or matter it appears to the Chairman or such
Member that the case or matter is of such a nature that it
ought to be heard by a Bench consisting of two Members,
the case or matter may be transferred by the Chairman
or, as the case may be, referred to him for transfer to,
such Bench as the Chairman may deem fit.
(7) Subject to the other provisions of this Act, the Benches
of the Central Administrative Tribunal shall ordinarily sit at
New Delhi (which shall be known as the principal Bench),
Allahabad, Calcutta, Madras, New Bombay and at such
other places as the Central Government may, by
notification, specify.
(8) Subject to the other provisions of this Act, the places
at which the principal Bench and other Benches of a State
Administrative Tribunal shall ordinarily sit shall be such as
the State Government may, by notification, specify.
xxx xxx xxx xxx
24. Conditions as to making of interim orders. -
Notwithstanding anything contained in any other
provisions of this Act or in any other law for the time being
in force, no interim order (whether by way of injunction or
stay or in any other manner) shall be made on, or in any
proceedings relating to, an application unless -
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(a) copies of such application and of all
documents in support of the plea for such interim
order are furnished to the party against whom such
application is made or proposed to be made; and
(b) opportunity is given to such party to be heard
in the matter:
Provided that a Tribunal may dispense with the
requirements of clauses (a) and (b) and make an interim
order as an exceptional measure if it is satisfied, for
reasons to be recorded in writing, that it is necessary so to
do for preventing any loss being caused to the applicant
which cannot be adequately compensated in money but
any such interim order shall, if it is not sooner vacated,
cease to have effect on the expiry of a period of fourteen
days from the date on which it is made unless the said
requirements have been complied with before the expiry
of that period and the Tribunal has continued the
operation of the interim order.
25. Power of Chairman to transfer cases from one
Bench to another. - On the application of any of the
parties and after notice to the parties, and after hearing
such of them as he may desire to be heard, or on his own
motion without such notice, the Chairman may transfer
any case pending before one Bench, for disposal, to any
other Bench.
49. Section 5 provides that a Tribunal is to consist of a
Chairman and such number of judicial and administrative
members as the appropriate Government may deem fit and,
subject to the other provisions of the Act, the jurisdiction,
powers and authority of the Tribunal may be exercised by the
Benches thereof. Sub-section 2 provides that a Bench is to
consist of one Judicial Member and one Administrative Member.
This, however, is subject to the other provisions of the said Act.
50. The Chairman of the Tribunal is an entity distinct from the
Tribunal and exercises administrative powers and such other
19
powers as are expressly conferred o him under the Act. Section
5(4)(a) of the Act empowers the Chairman to discharge in
addition to the functions of the Judicial Member or the
Administrative Member, of the Bench to which he is appointed,
the functions of the Judicial Member or the Administrative
Member of any other Bench.
51. Section 5(4)(b) empowers the Chairman to transfer a
Member from one Bench to another Bench, and Section 5(4)(c)
enables the Chairman to authorize the Judicial Member or the
Administrative Member of one Bench to discharge the duties
and functions of Judicial Member or Administrative Member, as
the case may be, of any other Bench. The Chairman can also
constitute Benches of more than two Members having regard to
the nature of the cases involved, by issuance of general or
special orders.
 52. Section 5(6) enables the Chairman or any other Member
authorized by the Chairman to function as a Single Bench and
exercise jurisdiction, powers and authority of the Tribunal in
respect of such classes of cases or such matters pertaining to
such classes of cases as the Chairman may by general or
special order specify.
53. The proviso to Section 5(c) of the Act states that if at any
stage of hearing of any such case or matter it appears to the
Chairman or the Member functioning singly that the case or
20
matter is of such a nature that it ought to be heard by a Bench
consisting of two Members, the case or matter may be
transferred by the Chairman, or as the case may be, referred to
him for transfer to such Bench as the Chairman may deem fit.
54. A perusal of Section 5 indicates that the Chairman is
empowered to discharge administrative functions of
constituting Benches by transferring a Member from one Bench
to another, authorizing the Judicial Member or the
Administrative Member appointed to one Bench to discharge
the functions of Judicial Member or Administrative Member of
another Bench.
55. Sub-section (6) of Section 5 empowers the Chairman or
any other Member authorized by the Chairman to sit singly to
exercise jurisdiction, powers and authority of the Tribunal only
in respect of such classes of cases or such matters pertaining
to such classes of cases as the Chairman might, by general or
special orders specify. The aforesaid provision does not enable
the Chairman sitting singly to nullify orders passed by a larger
Bench.
56. Section 24 of the Act limits the power to pass interim order
whether by way of injunction, stay or otherwise by imposing
conditions on the exercise of such power. No interim order is to
be made unless copies of the application along with documents
in support of the plea for interim order are furnished to the
21
party against whom such application is made and opportunity
to the heard is given to such party.
57. The aforesaid condition can only be dispensed with in
exceptional cases, if the Tribunal is satisfied, for reasons to be
recorded in writing, that it is necessary to pass an interim order
for preventing any loss to the applicant which cannot
adequately be compensated in money. The interim order, in
such case is to be of maximum duration of fourteen days
unless the requirements of sub-sections (a) and (b) are
complied with, before the expiry of fourteen days and the
interim order is extended.
58. The power under Section 25 of the Act to transfer cases
from one Bench to another is essentially an administrative
power of the Chairman of CAT. Such power is to be exercised
by the Chairman on his own motion or on the application of any
of the parties after notice to the parties, and after hearing such
of them as he may desire to be heard. The Chairman may, on
his motion, transfer any case pending before one Bench to
another without notice.
59. A careful reading of Section 25 of the Act makes it clear
that the Chairman deciding the question of whether a matter
should be transferred from one Bench to another cannot grant
interim stay of proceedings, their being no power conferred on
the Chairman under the said section to pass such interim stay.
22
60. Power under Section 24 to grant interim orders has been
conferred on the Tribunal, and/or in other words, a Bench of the
Tribunal in seisin of proceedings in respect of which the Bench
is entitled to exercise the jurisdiction and powers of the
Tribunal.
61. A Tribunal created under the Act as also its Chairman
derives its powers from the Act and can only exercise such
powers as are conferred by the Act. The Chairman of the
Tribunal exercising its power under Section 25 of the Act does
not function as a Tribunal. The proposition that the power to
grant interim relief must expressly be provided by statute finds
support from the judgment of the Supreme Court in Morgan
Stanley Mutual Fund vs. Kartick Das
10
. The Chairman of
CAT does not have power under Section 25 to pass any interim
order of stay of proceedings pending before a Bench of the
Tribunal.
62. A careful reading of the provisions of the Act and in particular
Sections 14 and 15 thereof in juxtaposition with Article 323A of the
Constitution leaves no manner of doubt that an Administrative
Tribunal constituted under the Act to give effect to Article 323A of
the Constitution exercises all the jurisdiction powers and authority
exercisable by all the Courts before commencement of the Act and
has all the attributes of a Court of law except that it is not bound
by the strict rules of procedure embodied in the Civil Procedure
10 (1994) 4 SCC 225
23
Code or the strict rules of evidence prescribed by the Evidence
Act, as observed above. All norms of judicial propriety and judicial
discipline apply as much to the Tribunal as to Courts including the
High Court.
63. A judicial order passed by a Tribunal is binding on all
concerned, including the Tribunal itself on its administrative side,
unless set aside or modified by a higher forum in exercise of
appellate or revisional powers. In no circumstance, can a judicial
order of a Bench of the Tribunal be nullified or rendered nugatory
by its Chairman.
64. In view of Section 12 of the Act, the Chairman of the Tribunal
can only exercise financial and administrative powers over the
Benches as may be vested under the Rules. The Chairman may
thus constitute Benches, shift members from one Bench to
another, constitute Single Benches, Division Benches and even
larger Benches, allocate business to the Benches and even transfer
cases from one Bench to the other, but having done so he cannot
interfere with the functioning of the Benches or tinker with its
orders by passing interim orders in a transfer petition.
65. In any case, judicial decorum and propriety demands that a
judicial order, ad interim, interim or final be vacated, varied,
modified, recalled or reviewed by a Bench of coordinate strength or
larger strength or a higher forum, but not a smaller Bench of lesser
strength, except in cases where such authority to a lower forum
and/or smaller Bench is expressly conferred or implicit in the order
24
sought to be vacated, varied, modified, recalled or reviewed.
66. In Union of India and Anr. vs. K. S. Subramanian
11
,
the Supreme Court observed that the proper course for a High
Court was to try to find out and follow the opinion expressed by
larger benches of this Court in preference to those expressed
by smaller Benches of the Supreme Court and that was the
practice also to be followed by the Supreme Court itself. The
practice has now crystallized into a rule of law declared by the
Supreme Court. A similar view was taken by the Supreme
Court in Bharat Petroleum Corporation Ltd. vs. Mumbai
Shramik Sangha & Ors.
12
. A five Judge Constitution Bench
of the Supreme Court observed that the decision of a
Constitution Bench of the Supreme Court would bind a Bench of
two judges of the Supreme Court and that judicial discipline
obliged them to follow it, regardless of their doubts about its
correctness.
67. It is true that the interim order passed by a Court does not
operate as a precedent and the law declared by the Supreme
Court with regard to the precedential value of judgments of
Benches of larger strength may not operate as a binding
precedent in the facts and circumstances of this case. The
judgments referred to in the preceding paragraphs lay down
the norms of judicial decorum and propriety which give
11 (1976) 3 SCC 677
12 (2001) 4 SCC 448
25
precedence to Benches of higher strength. There is no reason
at all why the same principles should not apply even to interim
orders in pending proceedings.
68. An interim order passed by a court, on consideration of the
prima facie case made out by an applicant, should ordinarily
have been vacated by a Bench of coordinate strength after
giving open notice to the applicant. If the Chairman was of the
considered opinion that there was urgency in the application for
vacating the interim order, the Chairman ought to have
assigned the application for vacating and/or vacation of the
interim order to a Bench of two or more Members to consider
whether the interim order should continue or be vacated. The
Chairman could also have exercised his power to suo motu
transfer the proceedings to another Bench without prior notice.
The order of stay of the proceedings before the Nainital Bench
is without jurisdiction and unsustainable in law.
69. Neither the judgment of the Constitution Bench of this
Court in L. Chandra Kumar (supra) nor the judgment of the
Division Bench of this Court in Dr. Mahabal Ram vs. Indian
Council of Agricultural Research and Others is an
authority for the proposition that the Chairman of CAT, sitting
singly to decide on application for transfer under Section 25 of
the Act, can stay the proceeding before a two Member Bench or
interfere with the orders of a two Member Bench. 
26
70. In L. Chandra Kumar (supra), cited on behalf of the
appellant, a Constitution Bench of seven Judges of the Supreme
Court held that the power of judicial review vested in the High
Court under Article 226 and in the Supreme Court under Article
32 of the Constitution was an integral and essential feature of
the Constitution constituting part of its basic structure.
Ordinarily, therefore, the power of the High Courts and the
Supreme Court to test the constitutional validity of legislations
could never be ousted or excluded. The power vested in the
High Court to exercise judicial superintendence over the
decision of all Courts and Tribunals within their respective
jurisdictions was also part of the basic structure of the
Constitution. Further, in L. Chandra Kumar (supra), this Court
upheld the vires of Section 5(6) of the Act observing that
Section 5(6) could harmoniously operate with Section 5(2) in
view of the proviso to Section 5(6). This Court also held that
the Tribunals are even competent to hear matters where vires
of statutory provisions are questioned, except where the vires
of their parent statute is in question, following the settled
principle that a Tribunal which is the creature of a statute
cannot declare that very statute to be unconstitutional. In such
cases alone, the High Court might be approached directly.
However, in discharging the duty of deciding vires of statutory
provisions, Tribunals cannot act as substitute for the High
Courts and the Supreme Court. Their function is
27
supplementary and all such decision of the Tribunals would be
subject to scrutiny before the Division Bench of the respective
High Courts.
71. In L. Chandra Kumar (supra) this Court held that
whenever any question involving the interpretation of a
statutory provision or rule in relation to Constitution arose for
consideration of a Single Bench of the Administrative Tribunal,
the provision to Section 5(6) would automatically apply and the
Chairman or the member concerned would be obliged to refer
the matter to a Bench consisting of at least two members one
of whom must be a judicial member. This would ensure that
questions involving vires of statutory provisions or rules would
never arise for adjudication before a Single Member Bench or a
Bench which does not consist of a judicial member. So
construed, Section 5(6) would no longer be susceptible to
charges of unconstitutionality and, therefore, valid and
constitutional.
72. In Dr. Mahabal Ram vs. Indian Council of Agricultural
Research and Others
13
, the Supreme Court held that subsections (2) and (6) appearing as limbs of the same Section 5
of the Act, have to be harmoniously construed. While
allocating work to a single Member, whether Judicial or
Administrative in terms of sub-section (6), the Chairman should
keep in view the nature of the litigation and where questions of
13 . (1994) 2 SCC 401
28
law or interpretation of constitutional provisions are involved,
they should not be assigned to a single Member. It would be
open to either party appearing before the single Member to
suggest to that Member hearing the matter that it should go to
a Bench of two Members. The Member should ordinarily allow
the matter to go to a Bench of two Members when so
requested. However, the contention that the single Member
contemplated under sub-section (6) had to mean a Judicial
Member only, was not accepted. In Dr. Mahabal Ram (supra),
the question was whether a Bench consisting of a single
Member under Section 5(6) necessarily had to be a Bench
comprising of a judicial member.
73. In our considered view, the Division Bench rightly allowed
the writ petition. The Chairman, like the Chief Justice of the
Higher Courts or the Chief Judge of subordinate courts, may be
higher in order of protocol and may have additional
administrative duties and responsibilities. However, the
Chairman, acting judicially, is equal to any other Member. The
Chairman, being one amongst equals, could not have stayed
proceedings pending before a larger Bench. We find no grounds
to interfere with the reasoning of the High Court. The High
Court rightly allowed the writ petition with costs. Since we
have upheld the order of the Division Bench of the HighCourt
under appeal and held that the order of the Chairman of CAT
staying proceedings before the two member Bench was without
29
jurisdiction and unsustainable in law, we need not go into the
various other contentions raised on behalf of the respondent
no.1.
74. The appeal is dismissed with costs, quantified at
Rs.25,000/-, to be deposited with the Supreme Court Legal
Services Committee within four weeks from the date.
.................................J.
(R. BANUMATHI)
.................................J.
(INDIRA BANERJEE)
NEW DELHI
FEBRUARY 01, 2019

Whether a person who asserts possessory title over a particular property will have to show that he is under settled or established possession of the said property. ?

Whether a   person   who   asserts possessory title over a particular property will have to show that he is under settled or established possession of the said property. ?



2019 ACJ- APEX COURT JUDGMENTS VOL.NO.1/2019 APEX COURT DIGEST VOL.NO.1



15. Generally, it is not open to the High Court to interfere with the findings of fact recorded by the First Appellate Court when such findings are based on the evidence on record, and are not perverse or against the material on record. - A   suit   came   to   be   filed   for   declaration   of   title   and   for

possession   by   Respondent   No.   1   herein.   Undisputedly,   the plaintiff     Moti   Ram   had   no   document   of   title   to   prove   his possession,   but   claimed   possessory   title   based   on   prior

possession for a number of years. Per contra, the   defendants   relied   on   two   sale   deeds,   viz.,   Ex.   A­6   dated 06.02.1956,   executed   by   the   original   owner   Khoom   Singh   in favour of Purkha Ram, and Ex. A­2 dated 21.06.1966, executed by Purkha Ram in favour of the appellant/Defendant No. 1.

 However, according to the plaintiff, he had been wrongly dispossessed by defendants on 30.04.1972,  which was within the 12 years preceding the filing

of the present suit.

The Trial Court decreed the suit and the First Appellate Court reversed the findings of the Trial Court. The First Appellate Court dismissed the said suit on the ground that the defendants had proved their title and possession over the suit property. - High court reversed the same and restore the trial court judgment - Apex court held that Section 64 of the Limitation Act, 1963 contemplates a suit for   possession   of   immovable   property   based   on   previous possession and not on title, if brought within 12 years from the date of dispossession.     Such a suit is known in law as a suit based   on   possessory   title   as   distinguishable   from   proprietary title.   It cannot be disputed and is by now well settled that ‘settled possession’ or effective possession of a person without title entitles him to protect his possession as if he were a true owner. -

whether the plaintiff had better title over the suit property and whether he was   in   settled possession   of   the   property,   which   required dispossession in accordance with law.

The   crux   of   the   matter   is   that   a   person   who   asserts possessory title over a particular property will have to show that he is under settled or established possession of the said property.

But merely stray or intermittent acts of trespass do not give such a right against the true owner.  Settled possession means such possession over the property which has existed for a sufficiently

long period of time, and has been  acquiesced to by the true owner.   A casual act of possession does not have the effect of interrupting the possession of the rightful owner.   A stray act of trespass, or a possession which has not matured into settled possession, can be obstructed or removed by the true owner even by using necessary force.   Settled possession must be (i) effective, (ii) undisturbed, and (iii) to the knowledge of the owner or without any attempt at concealment by the trespasser. There cannot be a straitjacket formula to determine settled possession. Occupation of a property by a person as an agent or a servant acting at the instance of the owner will not amount to actual legal possession.

The possession should contain an element of animus possidendi. The nature of possession of the trespasser is to be decided based on the facts and circumstances of each case.

In order to prove possession of the property, the plaintiff relied upon the rent note Ex. 1, which shows that the plot in question was let out by the plaintiff to one Joga Ram in the year 1967. On  12.05.1967, a fire broke out  and the entire fodder stored on the plot got burnt. Thereafter, the plot was kept vacant. DW­7, who has been referred to in order to establish spreading of the fire, stated that the fire started due to sparks coming from a railway engine. But there was no railway line adjacent to the disputed land which could have caused a fire.  Even otherwise, the rent note Ex. 1 does not refer to the plot in question, and its boundaries have also not been mentioned.   Merely on doubtful

material and cursory evidence, it cannot be held that the plaintiff was ever in possession of the property, and that too in settled possession.The plaintiff/Respondent No. 1 makes much of the old body of a motor vehicle belonging to him lying on the property. Ex. 2 clearly reveals that one part of the motor vehicle was lying on the disputed property and another part was lying on the plot of the

plaintiff.  The said body of the motor vehicle is about 3 to 4 feet in length   only   and   the   same   was   lying   on   the   boundary   of   the disputed property.   But the plaintiff/Respondent No. 1 claims possession of the entire plot based on such fact. Absolutely no material is found to show that the plaintiff/Respondent No. 1 was in actual possession, much less continuous possession, of the

property   for   a   longer   period   which   may   be   called   settled possession or established possession. As mentioned supra, mere casual possession, that too relying on a motor vehicle body lying on a part of the property, would not prove settled possession of the plaintiff.  The plaintiff has to prove his case to the satisfaction of the Court. He cannot succeed on the weakness of the case of the

defendant.   Even otherwise, there is no confusion at all regarding the   identity   of   the   property   in   question   and   on   the   basis   of material on record, the First Appellate Court has correctly ruled that   the   appellant/Defendant   No.   1   has   proved   his   title   and possession over the suit property since the date of his purchase of the property.   Prior to the purchase, his predecessor­in­interest was in possession of the same. Having regard to the position of law and facts of the case,

we are of the considered opinion that the High Court was not justified in interfering with the judgment of the First Appellate Court,   which   has   come   down   very   heavily   on   the   procedure adopted   by   the   trial   Judge   in   deciding   the   matter,   more particularly   when   no   fault   can   be   found   on   facts   with   the judgment of the First Appellate Court.  

Whether the secured creditor can file a winding up petition after such secured creditor has obtained a decree from the DRT and a recovery certificate based thereon ? 2019 - ACJ- APEX COURT JUDGMENTS VOL.NO.1/2019 APEX COURT DIGEST VOL.NO.1 14. the right of a secured creditor to file a winding up petition after such secured creditor has obtained a decree from the Debts Recovery Tribunal [“DRT”] and a recovery certificate based thereon. - The respondent, Kotak Mahindra Bank Limited, advanced various loans to the companies in question. The outstanding amount against these companies as on date, together with interest, is stated to be in the region of INR 48 crores. The respondent approached the Debts Recovery Tribunal, Mumbai by filing three separate original applications to recover the debt owed to them. The Debts Recovery Tribunal delivered three separate judgments on 16.01.2015 allowing the applications filed by the respondent bank. Apparently, the said orders are final as no appeals have been preferred to the Debts Recovery Appellate Tribunal [“DRAT”], Mumbai. Recovery certificates dated 12.08.2015 for the said amounts were then issued by the Recovery Officer under Section 19(19) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 [“Recovery of Debts Act”]. We have been informed that various attempts were made to auction the properties that were security for the loans granted, but each of these attempts has yielded no results.- In the meanwhile, the respondent issued statutory notices dated 15.04.2015 under Sections 433 and 434 of the Companies Act, 1956. As no payments were forthcoming, a company petition was filed before the Bombay High Court on 03.07.2015. By an order dated 26.07.2017, the said petition was admitted as the companies in question were said to be commercially insolvent.- In the appeals that were filed to the Division Bench of the Bombay High Court, the main point argued was that once a secured creditor has obtained an order from the DRT, and a recovery certificate has been issued thereupon, such secured creditor cannot file a winding up petition as the Recovery of Debts Act is a special Act which vests exclusive jurisdiction in the DRT. Also, a secured creditor can file a winding up petition only on giving up its security, which has not been done in the present case. These contentions did not find favour with the Division Bench who then dismissed the appeals in question.-Section 434(1)(b) is attracted only if execution or other process is issued in respect of an order of a Tribunal in favour of a creditor of the company is returned unsatisfied in whole or in part. This is only one of three instances in which a company shall be deemed to be unable to pay its debts. If the fact situation fits sub-clause (b) of Section 434(1), then a company may be said to be deemed to be unable to pay its debts. However, this does not mean that each one of the sub-clauses of Section 434(1) are mutually exclusive in the sense that once Section 434(1)(b) applies, Section 434(1)(a) ceases to be applicable. Also, on the facts of this case, we may state that the company petition was filed only on 03.07.2015, pursuant to a notice under Section 433 of the Companies Act, 1956 dated 15.04.2015. This petition was filed under Section 433(e) read with Section 434(1)(a) of the Companies Act, 1956. At the stage at which the petition was filed, it could not possibly have been filed under Section 434(1)(b) of the Companies Act, 1956, as execution or other process in the form of a recovery certificate had not been issued by the Recovery Officer till 12.08.2015, i.e., till after the company petition was filed. For this reason also, it is clear that this contention of the learned counsel appearing for the appellant must be rejected. We may only end by saying that cases like the present one have to be decided by balancing the interest of creditors to whom money is owing, with a debtor company which will now go in the red since a winding up petition is admitted against it. It is not open for persons like the appellant to resist a winding up petition which is otherwise maintainable without there being any bona fide defence to the same. We may also hasten to add that the respondent cannot be said to be blowing hot and cold in pursuing a remedy under the Recovery of Debts Act and a winding up proceeding under the Companies Act, 1956 simultaneously.

Whether the secured creditor can file a winding up petition after such secured creditor has obtained a decree from the DRT and a recovery certificate based thereon ?

2019 - ACJ- APEX COURT JUDGMENTS VOL.NO.1/2019 APEX COURT DIGEST VOL.NO.1

14.  the right of a secured creditor to file a winding up petition after such secured creditor has obtained a decree from the Debts Recovery Tribunal [“DRT”] and a recovery certificate based thereon. - The respondent, Kotak Mahindra Bank Limited, advanced various loans to the companies in question. The outstanding amount against these companies as on date, together with interest, is stated to be in the region of INR 48 crores. The respondent approached the Debts Recovery Tribunal, Mumbai by filing three separate original applications to recover the debt owed to them. The Debts Recovery Tribunal delivered three separate judgments on 16.01.2015 allowing the applications filed by the respondent bank. Apparently, the said orders are final as no appeals have been preferred to the Debts Recovery Appellate Tribunal [“DRAT”], Mumbai. Recovery certificates dated 12.08.2015 for the said amounts were then issued by the Recovery Officer under Section 19(19) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 [“Recovery of Debts Act”]. We have been informed that various attempts were made to auction the properties that were security for the loans granted, but each of these attempts has yielded no results.- In the meanwhile, the respondent issued statutory notices dated 15.04.2015 under Sections 433 and 434 of the Companies Act, 1956.
As no payments were forthcoming, a company petition was filed before the Bombay High Court on 03.07.2015. By an order dated 26.07.2017, the said petition was admitted as the companies in question were said to be commercially insolvent.- In the appeals that were filed to the Division Bench of the Bombay High Court, the main point argued was that once a secured creditor has obtained an order from the DRT, and a recovery certificate has been issued thereupon, such secured
creditor cannot file a winding up petition as the Recovery of Debts Act is a special Act which vests exclusive jurisdiction in the DRT. Also, a secured creditor can file a winding up petition only on giving up its security, which has not been done in the present case. These contentions did not find favour with the Division Bench who then dismissed the appeals in question.-Section 434(1)(b) is
attracted only if execution or other process is issued in respect of an order of a Tribunal in favour of a creditor of the company is returned unsatisfied in whole or in part. This is only one of three instances in which a company shall be deemed to be unable to pay its debts. If the fact situation fits sub-clause (b) of Section 434(1), then a company may be said to be deemed to be unable to pay its debts. However, this does not mean that each one of the sub-clauses of Section 434(1) are mutually exclusive in the sense that once Section 434(1)(b) applies, Section 434(1)(a) ceases to be applicable. Also, on the facts of this case, we may state that the company petition was filed only on
03.07.2015, pursuant to a notice under Section 433 of the Companies Act, 1956 dated 15.04.2015. This petition was filed under Section 433(e) read with Section 434(1)(a) of the Companies Act, 1956. At the stage at which the petition was filed, it could not possibly have been filed under Section 434(1)(b) of the Companies Act, 1956, as execution or other process in the form of a recovery certificate had not been issued by the Recovery Officer till 12.08.2015, i.e., till after the company petition was filed. For this reason also, it is clear that this contention of the learned counsel appearing for the appellant must be rejected. We may only end by saying that cases like the present one have to be decided by balancing the interest of creditors to whom money is owing, with a debtor company which will now go in the red since a winding up petition is admitted against it. It is not open for
persons like the appellant to resist a winding up petition which is otherwise maintainable without there being any bona fide defence to the same. We may also hasten to add that the respondent cannot be said to be blowing hot and cold in pursuing a remedy under the Recovery of Debts Act and a winding up proceeding under the Companies Act, 1956 simultaneously.

whether the rent agreed is to be considered as the rent paid by the date of comencement of the Act 2001[2003]under Rajasthan Rent control Act and it can not be considered as a revisied enhanced rent with 10% increase – more than the prescribed in the Act 2001 ?

whether the rent agreed is to be considered as the rent paid by the date of comencement of the Act 2001[2003]under Rajasthan Rent control Act and it can not be considered as a revisied enhanced rent with 10% increase – more than the prescribed in the Act 2001 ?

2019 – ACJ- APEX COURT JUDGMENTS VOL.NO.1/ 2019 APEX COURT DIGEST -VOL.NO.1

Rajasthan Rent Control Act, = Rent deed contained a clause for yearly increase of rent by 10%. The tenant continued to pay rent to the landlord as per the agreed rent with 10% enhancement yearly. The landlord issued notice dated 27.03.2004 stating that with effect from 01.08.2003 upto 29.02.2004, for a period of seven months, the tenant has neither paid or tendered rent, arrears from 01.08.2003 to 29.02.2004 amounting to Rs.1,15,945/­ were asked to be deposited
in the bank account of landlord. Notice mentioned that in the event the tenant does not deposit the amount in the account, landlord shall be compelled to carry out legal proceedings for eviction of the tenant.-After the aforesaid notice dated 27.03.2004 the tenant deposited an amount of Rs.95,200/­ on 26.04.2004 in the bank account of the landlord .- Landlord filed an Application No.1258 of 2004 under Section 9 of the Rajasthan Rent Control Act, 2001 (hereinafter referred to as the “Act,

2001”) praying for eviction on the ground of arrears of rent. – The tenant filed reply opposing the abovesaid application. The tenant took stand in the application that in accordance with the provisions of Act, 2001, which has come into effect from 01.04.2003, on increasing the rent under the provisions of Section 6 in the prescribed rent of Rs.8,500/­ @ 7.5% per annum

the rate of rent from 01.04.2003 comes to be Rs.13,600/­ per month. It was stated In the written statement that tenant has deposited rent upto February, 2004 @ Rs.13,600/­ per month i.e. a total of Rs.95,200/­ in the bank account. – Rejoinder was filed by the landlord where it was pleaded that respondent­tenant has been paying rent from August, 2002 @ Rs.16,564/­ per month which rent was paid till July, 2003. It was claimed that the

respondent­tenant is liable to pay rent @ Rs.16,564/­ per month. The Rent Tribunal heard the parties and by its judgment and order dated 22.04.2011 directed for eviction of the tenant. The Rent Tribunal held that the case of tenant that rent is payable @ Rs.13,600/­ per month cannot be accepted. The tenant having not deposited at the rate of Rs.16,564/­ per month, has

committed default in paying rent -An appeal was filed by the tenant before the Rent Appellate Tribunal which too was dismissed by order dated 15.01.2014. The order of the Rent Tribunal was upheld- The tenant aggrieved by the order of the Appellate Tribunal filed Writ

Petition in the High Court which writ petition was allowed by the learned Single Ju Against the

judgment of the learned Single Judge dated 0dge vide its judgment and order dated 09.10.2014.9.10.2014 Special Appeal was filed which was dismissed by the Division Bench vide its judgment dated 14.12.2015 holding writ appeal as not maintainable.- The High Court in its judgment has held that after the enforcement of the Act, 2001 no agreement can provide for higher revision of rent. The High Court in its judgment has made following observation: “Section 6 of the Act starts with nonobstantive clause, thus no agreement to provide higher or lower rate of revision of rent would operate after commencement of the Act of 2001. The landlord was thus not at liberty to claim rent with enhancement @ 10% per annum.”- Aggrieved against the judgments of the High Court landlord has filed these appeals. –

Apex court held that By the notice given by the landlord dated 27.03.2004 an amount of Rs.1,15,945/­ which was due from August, 2003 to February, 2004 was demanded at the rate of Rs.16,564/­ per month. The tenant having not deposited the due amount and having deposited amount of only Rs.95,200/­ on 26.04.2004 has committed default.- Learned counsel for the respondent refuting the submission of the learned counsel for the appellants submits that the High Court has rightly taken the view that the landlord was not entitled to enhancement of

the rent more than 5% in view of the Act, 2001. The landlord was not at liberty to claim rent with enhancement at the rate of 10% per annum. The High

Court had rightly held that permitting the landlord to demand rent with increase of 10% shall be contrary to the Section 6 of the Act, 2001.-The issue in these appeals pertains to rate of rent and the revision of rent as prescribed by the Act, 2001, hence, only those provisions of both the earlier Act and the Act,2001 need to be noted. Act, 2001 has repealed the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.- The observation of the High Court that landlord was entitled to the rent as was payable on the date of commencement of the Act, 2001 without its revision is perfectly correct. The landlord cannot claim revision of rent as per agreement at the rate of 10% per annum after the enforcement of the Act. The present is not a

case that the landlord is claiming rent after the enforcement of the Act by adding 10% increase in the rent. The landlord’s case throughout is that the rent at the rate of Rs.16,564/­ per month was being paid by the tenant since before the commencement of the Act and even after the commencement of the Act, till the month of July, 2003 the tenant paid rent at the rate of

Rs.16,564/­ per month.-Section 4 of the Act which deals with the agreed rent provides that rent payable for any premises shall subject to the provisions of this Act, be such as may be agreed between the landlord and the tenant. When the tenant was paying the rent of Rs.16,564/­ per month before the enforcement of the Act as per the rent agreement, the said amount was agreed amount which wasbeing paid before the enforcement of the Act. It is true that in the agreed amount which was being paid immediately before the commencement of the Act, the landlord cannot increase @ 10% of the rent as per agreement. The increase after the enforcement of the Act shall be in accordance with Section 6 and in the event the tenant does not agree for the said increase,the landlord is free to file application under Section

6 read with Section 14. In view of the foregoing discussion, we are of the view that the High Court has not appreciated the true import of Sections 6 and 7 of the Act, 2001 in observing that the tenant is not in default. -In the present case arrears demanded by the notice i.e.

Rs.16,564/­ per month starting from December, 2003 to February, 2004 totalling Rs.1,15,945/­ were required to be paid by the tenant, the tenant having paid only Rs.95,200/­ as per his calculation of the rent at the rate of Rs.13,600/­ per month has committed default. According to the learned counsel for the tenant, the rent paid by the tenant was sufficient to cover the rent upto December, 2003 and part of January, 2004, admittedly, the arrears as demanded having not been paid and we having found that the landlord has demanded

arrears of rent for seven months according to rate of rent Rs.16,564/­ per month which was being paid by the tenant even before the enforcement of the Act, 2001 and after the enforcement of the Act, 2001. The landlord having not added 10% increase in the rent demanded,

there was no breach of Section 6 and the High Court has committed error in allowing the writ petition of the tenant.

Section 245(2) CrPC/Sec.482 Cr.P.C = Discharge of accused- quashing of complaint - in the absence of source for the claim of purchasing shares out of his funds - without establishing the same in right forum, complaint is not maintainable

Section 245(2) CrPC/Sec.482 Cr.P.C. = Complaint - under Sections 406, 420, 467, 471, 323, 504, 506, 447 and 448 IPC. - the 3rd Additional Chief Judicial Magistrate, Ghaziabad found that no ground to summon the appellants for trial was made out and the complaint being devoid of merits was liable to be dismissed under Section 203 CrPC - The aforesaid order was, however, set aside in Criminal Revision  preferred by Respondent No.2 by the Additional Sessions Judge, Court No.2, Ghaziabad, who by his order remanded the matter with a direction to pass fresh orders after granting an opportunity of hearing to Respondent No.2.- The appellants being aggrieved, preferred application under Section 482 CrPC in the High Court. - Said application was disposed of by the High Court  observing that if the appellants moved an application under Section 245(2) CrPC the same be heard and disposed of expeditiously.-The application for discharge was rejected by the Additional Chief Judicial Magistrate, Court No.3, Ghaziabad - While so rejecting, it was observed that sufficient grounds to frame charges under Sections 420, 323 and 504 IPC were made out.- the appellant  filed petition in High Court under sec.482 Cr.P.C. - However, the High Court observed that in a petition under Section 482 CrPC disputed questions of fact could not be gone into and whether the shares were purchased by the appellants or by Respondent No.2 was a matter of evidence and as such no interference was called for. The aforesaid application was thus dismissed by the High Court on 29.05.2018, which decision is presently under challenge. -

Apex court held that 
. 
To invoke its inherent jurisdiction under Section 482 CrPC the High Court has to be fully satisfied that the material produced by the accused is such that would lead to the conclusion that his/their defence is based on sound, reasonable, and indubitable facts; the material produced is such as would rule out and displace the assertions contained in the charges levelled against the accused; and the material produced is such as would clearly reject and overrule the veracity of the allegations contained in the accusations levelled by the prosecution/ complainant. It should be sufficient to rule out, reject and discard the accusations levelled by the prosecution/complainant, without the necessity of recording any evidence. 
For this the material relied upon by the defence should not have been refuted, or alternatively, cannot be justifiably refuted, being material of sterling and impeccable quality. 
The material relied upon by the accused should be such as would persuade a reasonable person to dismiss and condemn the actual basis of the accusations as false. 
In such a situation, thejudicial conscience of the High Court would persuade it to exercise its power under Section 482 CrPC to quash such criminal proceedings, for that would prevent abuse of process of the court, and secure the ends of justice. 
Based on the factors canvassed in the foregoing paragraphs, we would delineate the following steps to determine the veracity of a prayer for quashment raised by an accused by invoking the power vested in the High Court under Section 482 CrPC: 
1. Step one: whether the material relied upon by the accused is sound, reasonable, and indubitable i.e. the material is of sterling and impeccable quality? 
2. Step two: whether the material relied upon by the accused would rule out the assertions contained in the charges levelled against the accused i.e. the material is sufficient to reject and overrule the factual assertions contained in the complaint i.e. the material is such as would persuade a reasonable person to dismiss and condemn the factual basis of the accusations as false? 
3. Step three: whether the material relied upon by the accused has not been refuted by the prosecution/complainant; and/or the material is such that it cannot be justifiably refuted by the prosecution/complainant? 
4. Step four: whether proceeding with the trial would result in an abuse of process of the court, and would not serve the ends of justice?
5. If the answer to all the steps is in the affirmative, the judicial conscience of the High Court should persuade it to quash such criminal proceedings in exercise of power vested in it under Section 482 CrPC. Such exercise of power, besides doing justice to the accused, would save precious court time, which would otherwise be wasted in holding such a trial (as well as proceedings arising therefrom) specially when it is clear that the same would not conclude in the conviction of the accused.”
In the present case the shares in question, right since the date of acquisition have always been in the custody of Appellant No.1. The material on record is absolutely clear that the acquisition was from the funds of Appellant No.1. The complainant has merely alleged that the funds came from his bank account but beyond such allegations no material has been placed on record at any stage. 
The stand taken by the appellants in their application under Section 245(2) CrPC is quite clear that the shares can be sold in the market and the proceeds can be divided between Appellant No.2 and Respondent No.2. If Respondent No.2 is insisting on having complete ownership in respect of the concerned shares, the matter must first be established before a competent forum. 
We have considered the material on record through the steps indicated in Rajiv Thapar v. Madan Lal Kapoor (supra) and are convinced that the instant case calls for interference under Section 482 CrPC. 
Further, from the facts that Appellant No.1 had disowned Respondent No.2 and had filed civil proceedings seeking appropriate orders against them, we are also convinced that the present criminal complaint is nothing but an attempt to wreck vengeance against the father, brother and the brother in law of the complainant. The instant criminal complaint is an abuse of the process of Court and is required to be quashed.
We, therefore, allow this appeal, set aside the orders passed by the Courts below and allow the application for discharge under Section 245(2) CrPC in complaint No.3804 of 2009 on the file of third Additional Chief Judicial Magistrate, Ghaziabad.

Hon'ble Mr. Justice Uday Umesh Lalit (

Criminal Appeal No.56 of 2019
 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr.
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REPORTABLE IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. 56 OF 2019
(Arising out of Special Leave Petition (Crl.) No.8143 of 2018)
Sri Suresh Kumar Goyal and Others …Appellants
VERSUS
State of Uttar Pradesh and Another …Respondents
JUDGMENT Uday Umesh Lalit, J.
1. Leave granted. This appeal challenges the order dated 29.05.2018 passed by the High Court of Judicature at Allahabad dismissing application preferred by the appellants under Section 482 CrPC being Application No.22324 of 2011.
2. Respondent No.2 filed Complaint No.3804 of 2009 in the Court of 3rd Additional Chief Judicial Magistrate, Ghaziabad on 02.12.2009 against Appellant Nos.1, 2 and 3 namely his father, brother and brother-in-law. The main allegations as set out in paragraphs 3, 4, 5, 7 and 10 of the Complaint were as under:- 
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“3. THAT Complainant had purchased 2 folios consisting of 100 shares of Reliance Industry. 1st folio was in the name of the Complainant and accused no.2 and 2nd folio was in the joint names of accused no.2 and complainant. The address in these shares is House no. KC-102/2, Kavi Nagar, Ghaziabad. Thereafter Reliance company sent to complainant 100 shares in the year 1997 and 200 shares of their company in this year itself.
4. THAT all the accused in furtherance of their conspiracy beat the Complainant and threw him out of the house along with his children in the year 1998 for mala fide reasons. They also forged signatures of complainant in the years 1997 and 2006 and illegally procured bonus shares and when complainant demanded back his original shares and bonus shares from them, they misbehaved with the complainant and refused to disclose anything to him. The complainant is presently living in Chiranjiv Vihar with his children for the sake of lives of himself and his children and also to maintain peace in the family.
5. THAT Folio number of the shares is 068119227 and complainant is not aware of the number of 2nd folio and he will provide it later on whenever he comes to know of it. Because all the shares are in the custody of the accused. Not only this, 100 shares of M/s. Amrit Banaspati Co. Ltd., belonging to Complainant, are also in the custody of the accused.
7. THAT all the original shares had been handed over to accused no.2 by the complainant after purchasing them for safe custody.
10. THAT all shares of complainant are in custody of accused and cost of the shares is approx. Rs.4.50 Lacs.”
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3. It was thus alleged that the appellants had betrayed and cheated Respondent No.2 and were guilty of offences punishable under Sections 406, 420, 467, 471, 323, 504, 506, 447 and 448 IPC. However, by his order dated 18.06.2010 the 3rd Additional Chief Judicial Magistrate, Ghaziabad found that no ground to summon the appellants for trial was made out and the complaint being devoid of merits was liable to be dismissed under Section 203 CrPC. The aforesaid order was, however, set aside in Criminal Revision No.179 of 2010 preferred by Respondent No.2 by the Additional Sessions Judge, Court No.2, Ghaziabad, who by his order dated 11.11.2010 remanded the matter with a direction to pass fresh orders after granting an opportunity of hearing to Respondent No.2. The appellants being aggrieved, preferred application under Section 482 CrPC being Application No.9156 of 2011 in the High Court. Said application was disposed of by the High Court on 23.03.2011 observing that if the appellants moved an application under Section 245(2) CrPC the same be heard and disposed of expeditiously.
4. Accordingly, an application under Section 245(2) CrPC was moved by the appellants. Paragraphs 6 to 15 of the application for discharge dealt with acquisition of shares of Reliance Industries Ltd. Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 
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“6. THAT true and correct position is that an application for allotment of 100 debentures of M/s. Reliance Polythene Limited was given by the coapplicant, Suresh Goyal in the year 1993. This application was filed by him for allotment of shares in the names of his sons i.e. Arun Kumar Goyal (i.e. the complainant) and Devinder Kumar Goyal and for which the said co-applicant had given a cheque of his own bank. 7. THAT thereafter Reliance Polythene Limited issued 100 debentures of their Company being Debenture Nos. 004959401 to 004959500 vide Master Folio No.68119227 and Certificate No.0049595 on the basis of above application of applicant Suresh Kumar Goyal on 15.4.1993. 8. THAT thereafter above said 100 debentures were converted by M/s. Reliance Polythene Limited into shares and accordingly issued 100 shares bearing Share Nos.154702201 to 154702300 in the names of Arun Kumar Goyal (i.e. the complainant) and Devinder Kumar Goyal vide Master Folio no.68119227 and Certificate No.00545523. It is pertinent to mention here that conversion of debentures into 100 shares vide Master Folio No.68119227 was done by the above said company in pursuance of their own policy and no application for this conversion was ever given by the applicant. 9. THAT later on M/s. Reliance Polythene Limited merged with M/s. Reliance Industries Limited and thereafter 25 shares of this company in lieu of above said 100 shares were allotted by the company according to their policy bearing Share Nos. 400314745 to 400314769 in the names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal vide Folio No.68119227 and Certificate No.056387476. It is pertinent to mention
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here that this conversion of shares into 25 shares was also done by the Company under their own policy. The above shares were issued under Folio No.68119227. 10. THAT thereafter M/s. Reliance Industries Limited issued 25 shares of their company in the names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal bearing Share Nos.400314745 to 400314769 Folio No.68119227 and Certificate No.056387476. 11. THAT later on Reliance Industries Limited divided its company into 4 companies, whose names are mentioned hereinafter, under their Policy and issued 50 shares each in the joint names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal – (a) Reliance Energy Ventures Limited: Folio No.001486420, Certificate No. 000148642, Share Nos.0007302483 to 0007302532 dated 27.1.2006 – Total No. of shares 50. (b) Reliance Communication Ventures Limited: Folio No.001486420, Certificate No. (Illegible) Share Nos. (Illegible) dated (Illegible) – total no. of shares 50. (c) Reliance Resources Limited: Folio No.001486420, Certificate No.000148642, Share Nos. 0007302483 to 0007302532 dated 27.1.2006 – Total No. of shares 50. (d) Reliance Capital Ventures Limited: Folio No.001486420, Certificate No.000148642, Share Nos. 0007302483 to 0007302532 dated 27.1.2006 – Total No. of shares 50.

Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr.
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12. THAT thereafter 3 new Companies were formed in the names of Reliance Capital Limited, Reliance Energy Limited and Reliance Power Limited under the Company Policy after merging all the above named 4 companies and following shares were issued in the joint names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal – (a) M/s. Reliance Capital Limited: Master Folio No.102341601, Certificate No.016334160, share Nos. 0225139303 to 0225139305 = 2 Shares. (b) M/s. Reliance Energy Limited: Master Folio No.102341601, Certificate no. 015734160, share Nos.0213764143 to 0213764145 = 3 Shares. (c) M/s. Reliance Power Limited: Master Folio No.20148620, Certificate no. (Illegible), share Nos. 23978999076 to 2397899087 = 12 Shares. 13. THAT thereafter M/s. Reliance Industries Limited under its Company policy issued 50 bonus shares in the joint names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal vide Folio No.608119227, Certificate No.622733328, Share Nos.002226357219 to 00222357268 dated 28.11.2009. 14. THAT in this manner it would be apparent from the above facts that 100 shares of Reliance Industries Co.; 2 shares of Reliance Capital Limited; 3 shares of Reliance Energy Limited; and 12 shares of Reliance Power Limited have been issued in the joint names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal. These shares were sent by the company at House No.KC-102/2, Kavi Nagar, Ghaziabad i.e. the address maintained in their

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records. The originals of all the above shares are available with Devinder Kumar Goyal. In this manner, it would be apparent from the above that neither the applicants nor the complainant have purchased these shares from the open market. All the shares have been allotted by the company in lieu of the money paid by Suresh Kumar Goyal (i.e. father of Arun Kumar Goyal and Devinder Kumar Goyal) although these shares have been issued by company in the joint names of Arun Kumar Goyal and Devinder Kumar Goyal. None of the applicants had given any application in writing for collecting bonus shares nor any one of them ever attempted to sell any of these shares. Therefore allegation of the complainant that applicants have obtained bonus shares by cheating and/or by forging his signatures, is patently wrong and false and accused emphatically deny the same. (illegible). 15. THAT it thus becomes evident from perusal of above facts that no shares have been purchased by Arun Kumar Goyal either from the Company or from the open market.”
5. Similarly, the acquisition of shares of M/s. Amrit Vanaspati Company Ltd. was also dealt with and it was asserted:- “18. THAT all the above shares are in joint names. It is pertinent to mention here that no one can either sell or transfer the shares which are in the joint names nor anyone can change the address, unless and until both the shareholders agree and sign for this. 19. THAT no other shares have been purchased except the above shares. Therefore, the allegations
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of complainant that he will furnish details/information of one other folio as and when he becomes aware of that, are patently wrong, false and baseless and applicants emphatically deny such allegations. 20. THAT it is thus evident from the above facts that all the shares allotted by M/s. Reliance Industries have been issued in the joint names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal. Resultantly Complainant and Devinder Kumar Goyal have equal share in the above shares. Originals of all these shares are in the possession of Devinder Kumar Goyal. 21. THAT similarly shares allotted by M/s. Amrit Vanaspati Company are also in the joint names of Arun Kumar Goyal (i.e. complainant) and Devinder Kumar Goyal and consequently both the complainant and Devinder Kumar Goyal have equal shares in them. The originals of these shares are also in possession of Devinder Kumar Goyal. 22. THAT Anil Kumar Garg has absolutely nothing to do with this case. He is the real Son-inlaw of Suresh Kumar Goyal and that is why he too has been falsely implicated in this case. 23. THAT Suresh Kumar Goyal and Devinder Kumar Goyal even offered the Complainant-Arun Kumar Goyal to collect money of his half share in the above shares after selling them in the open market. But he is not ready for this offer. He is not entitled to demand all the shares.” 6. The application for discharge was rejected by the Additional Chief Judicial Magistrate, Court No.3, Ghaziabad vide his order dated 14.06.2011.

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr.
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While so rejecting, it was observed that sufficient grounds to frame charges under Sections 420, 323 and 504 IPC were made out.
7. The aforesaid order was challenged by the appellants by filing application under Section 482 CrPC namely Application No.22324 of 2011. The High Court noted the contentions on behalf of the appellants as under: “As applicant no. 1 was not happy with the conduct of the opposite party no.2, he disowned him and also filed O.S. No.406 of 2007 in the court of Civil Judge (Senior Division), Ghaziabad for a decree of declaration. A criminal complaint was also initiated by applicant no.1 against the opposite party no.2 under Sections 420, 406, 409, 321, 323, 385, 442 IPC. … … … On 2.12.2009, the opposite party no. 2 filed a Complaint Case No.3884 of 2009 against the applicants on the ground that opposite party no. 2 had purchased shares from the Reliance Industries in the name of complainant and applicant no. 2. It is further alleged in the complaint that in the year 1997 and in the year 2006 by making forged signature of the complainant bonus shares were received by the applicants and original shares were also in the possession of the applicants. In spite of demand same has not been handed over to the complainant. It is further alleged in the complaint that applicants with mala fide intention on 9.10.2007 sent a letter to the company which was received to the company on 10.10.2007 and thereafter complainant on 15.8.2009

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and 17.8.2009 sent mails to the company in this regard. It is submission of the learned counsel for the applicants that shares were purchased by the applicant no. 1, although they were also in the name of opposite party no.2. At no point of time any forgery has been committed and preparation of any act cannot be termed as forgery.”
8. However, the High Court observed that in a petition under Section 482 CrPC disputed questions of fact could not be gone into and whether the shares were purchased by the appellants or by Respondent No.2 was a matter of evidence and as such no interference was called for. The aforesaid application was thus dismissed by the High Court on 29.05.2018, which decision is presently under challenge.
9. In support of the appeal, it was submitted that the instant complaint was a counter blast after Appellant No.1 had disowned Respondent No.2 by issuing an advertisement in the newspaper and swearing an affidavit to that effect; and after he had filed a civil suit seeking injunction against Respondent No.2 from coming to the house of the appellants and causing any hindrance; and after a criminal complaint was filed by the Appellant No.1 against Respondent No.2. It was submitted that as disclosed in the application under

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 11
Section 245(2) CrPC, the entire funding for acquisition of the shares in question had come from Appellant No.1 in the year 1992-1993 when Respondent No.2 was a youngster aged about 24 years. In support of the assertion that the acquisition was from the funds of Appellant No.1, the photocopies of the concerned bank accounts were also placed on record. On the other hand, the learned counsel for Respondent No.2 reiterated the submission that the issue of ownership was essentially a question of fact which had to be decided in the pending complaint and that the matter ought not to be entertained in an application for discharge. In support of the submission that Respondent No.2 had acquired those shares from his own funds, reliance was placed upon a typewritten extract showing debit entries of Rs.1250/-, Rs.1250/- and Rs.500/- dated 04.05.1993, 08.06.1994 and 15.10.1994 which extract was however without any details.
10. This Court adjourned the matter to enable the parties to arrive at an amicable settlement whereafter the appellants agreed to withdraw all the cases filed by them against Respondent No.2 on the condition that similar such cases filed by Respondent No.2 against them also be withdrawn, giving quietus to all the proceedings between the parties. Respondent No.2, however, did not agree to the proposal.

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 12
11. The thrust of the allegations in the complaint is that the shares in question were acquired from the funds of the complainant, though they have always stood in the names of the complainant and his brother. It is also accepted that the shares have always been in the custody of the father i.e. Appellant No.1. Beyond mere allegation that the funds for acquisition came from his bank account, nothing has even been suggested by the complainant. The entries dated 04.05.1993, 08.06.1994 and 15.10.1994 relied upon by him are much after the issuance of 100 debentures by Reliance Polythene Ltd. on 15.04.1993. As detailed in the application under Section 245(2) CrPC the basic acquisition was these 100 debentures which investment, with the passage of time, got converted and progressed to the present level. The complainant was not even aware of these details. The allegations of beating and intimidation are of the year 1998 and completely devoid of any substance. The question is: are these aspects sufficient to invoke the jurisdiction to discharge the appellants or should the appellants be made to go through the rituals and rigour of trial.
12. While dealing with the jurisdiction under Section 482 CrPC to quash the proceedings at the stage of issuance of process, or at the stage of committal, or at the stage of framing of charges, that is to say before the

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 13
 commencement of actual trial, in the light of material placed on record by the accused, this Court in Rajiv Thapar and Others v. Madan Lal Kapoor1 laid down as under:- “28. The High Court, in exercise of its jurisdiction under Section 482 CrPC, must make a just and rightful choice. This is not a stage of evaluating the truthfulness or otherwise of the allegations levelled by the prosecution/complainant against the accused. Likewise, it is not a stage for determining how weighty the defences raised on behalf of the accused are. Even if the accused is successful in showing some suspicion or doubt, in the allegations levelled by the prosecution/complainant, it would be impermissible to discharge the accused before trial. This is so because it would result in giving finality to the accusations levelled by the prosecution/ complainant, without allowing the prosecution or the complainant to adduce evidence to substantiate the same. The converse is, however, not true, because even if trial is proceeded with, the accused is not subjected to any irreparable consequences. The accused would still be in a position to succeed by establishing his defences by producing evidence in accordance with law. There is an endless list of judgments rendered by this Court declaring the legal position that in a case where the prosecution/ complainant has levelled allegations bringing out all ingredients of the charge(s) levelled, and have placed material before the Court, prima facie evidencing the truthfulness of the allegations levelled, trial must be held. 1 (2013) 3 SCC 330

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 14
29. The issue being examined in the instant case is the jurisdiction of the High Court under Section 482 CrPC, if it chooses to quash the initiation of the prosecution against an accused at the stage of issuing process, or at the stage of committal, or even at the stage of framing of charges. These are all stages before the commencement of the actual trial. The same parameters would naturally be available for later stages as well. The power vested in the High Court under Section 482 CrPC, at the stages referred to hereinabove, would have farreaching consequences inasmuch as it would negate the prosecution’s/complainant’s case without allowing the prosecution/complainant to lead evidence. Such a determination must always be rendered with caution, care and circumspection. To invoke its inherent jurisdiction under Section 482 CrPC the High Court has to be fully satisfied that the material produced by the accused is such that would lead to the conclusion that his/their defence is based on sound, reasonable, and indubitable facts; the material produced is such as would rule out and displace the assertions contained in the charges levelled against the accused; and the material produced is such as would clearly reject and overrule the veracity of the allegations contained in the accusations levelled by the prosecution/ complainant. It should be sufficient to rule out, reject and discard the accusations levelled by the prosecution/complainant, without the necessity of recording any evidence. For this the material relied upon by the defence should not have been refuted, or alternatively, cannot be justifiably refuted, being material of sterling and impeccable quality. The material relied upon by the accused should be such as would persuade a reasonable person to dismiss and condemn the actual basis of the accusations as false. In such a situation, the

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 15
judicial conscience of the High Court would persuade it to exercise its power under Section 482 CrPC to quash such criminal proceedings, for that would prevent abuse of process of the court, and secure the ends of justice. 30. Based on the factors canvassed in the foregoing paragraphs, we would delineate the following steps to determine the veracity of a prayer for quashment raised by an accused by invoking the power vested in the High Court under Section 482 CrPC: 30.1. Step one: whether the material relied upon by the accused is sound, reasonable, and indubitable i.e. the material is of sterling and impeccable quality? 30.2. Step two: whether the material relied upon by the accused would rule out the assertions contained in the charges levelled against the accused i.e. the material is sufficient to reject and overrule the factual assertions contained in the complaint i.e. the material is such as would persuade a reasonable person to dismiss and condemn the factual basis of the accusations as false? 30.3. Step three: whether the material relied upon by the accused has not been refuted by the prosecution/complainant; and/or the material is such that it cannot be justifiably refuted by the prosecution/complainant? 30.4. Step four: whether proceeding with the trial would result in an abuse of process of the court, and would not serve the ends of justice?

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30.5. If the answer to all the steps is in the affirmative, the judicial conscience of the High Court should persuade it to quash such criminal proceedings in exercise of power vested in it under Section 482 CrPC. Such exercise of power, besides doing justice to the accused, would save precious court time, which would otherwise be wasted in holding such a trial (as well as proceedings arising therefrom) specially when it is clear that the same would not conclude in the conviction of the accused.”
13. In the present case the shares in question, right since the date of acquisition have always been in the custody of Appellant No.1. The material on record is absolutely clear that the acquisition was from the funds of Appellant No.1. The complainant has merely alleged that the funds came from his bank account but beyond such allegations no material has been placed on record at any stage. The stand taken by the appellants in their application under Section 245(2) CrPC is quite clear that the shares can be sold in the market and the proceeds can be divided between Appellant No.2 and Respondent No.2. If Respondent No.2 is insisting on having complete ownership in respect of the concerned shares, the matter must first be established before a competent forum. We have considered the material on record through the steps indicated in Rajiv Thapar v. Madan Lal Kapoor (supra) and are convinced that the instant case calls for interference under

 Criminal Appeal No.56 of 2019 Sri Suresh Kumar Goyal & Ors. Vs. State of Uttar Pradesh & Anr. 17
Section 482 CrPC. Further, from the facts that Appellant No.1 had disowned Respondent No.2 and had filed civil proceedings seeking appropriate orders against them, we are also convinced that the present criminal complaint is nothing but an attempt to wreck vengeance against the father, brother and the brother in law of the complainant. The instant criminal complaint is an abuse of the process of Court and is required to be quashed.
14. We, therefore, allow this appeal, set aside the orders passed by the Courts below and allow the application for discharge under Section 245(2) CrPC in complaint No.3804 of 2009 on the file of third Additional Chief Judicial Magistrate, Ghaziabad. 15. Since we have found that the initiation of complaint was not a bona fide exercise, we direct Respondent No.2 to pay a sum of Rs.25,000/- (Rupees twenty five thousand only) within two months from today to each of the appellants by way of costs for initiating frivolous litigation. .………..………..…..……..……J. (Uday Umesh Lalit) ..………...………….……………J. (Dr. Dhananjaya Y. Chandrachud) New Delhi, January 11, 2019.