whether the amendment which has been brought about by the legislature is intended to be clarificatory or to remove an ambiguity in the law must depend upon the context. = The provisions of Section 142(2C) of the Income Tax Act 1961, as they stood prior to the amendment which was enacted with effect from 1 April 2008 by the Finance Act, 2008 did not preclude the exercise of jurisdiction and authority by the assessing officer to extend time for the submission of the audit report directed under subsection (2A), without an application by the assessee. We hold and declare that the amendment was intended to remove an ambiguity and is clarificatory in nature. As a consequence of our decision, we specifically overrule the judgment of a Division Bench of the Delhi High Court in Commissioner of Income Tax v Bishan Swaroop Ram Kishan Agro Pvt. Ltd.15 dated 27 May 2011.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No 3211 of 2019
(Arising out of SLP (C) No 2810 of 2012)
The Commissioner of Income Tax, New Delhi …Appellant(s)
VERSUS
Ram Kishan Dass …Respondent(s)
WITH
Civil Appeal No(s). 3214, 3212, 3213, 3228, 3230, 3215, 3229, 3216, 3219, 3220,
3217, 3221, 3218, 3222, 3223, 3225, 3226, 3224, 3227
of 2019 @SLP (C) No. 6082, 2808, 2811, 27681, 36495, 6680, 36496, 7573, 8761,
9463, 7660, 9720, 8512, 10191, 10190, 12026, 12027, 11869, 16130 of 2012, Civil
Appeal No 2951 of 2012, Civil Appeal Nos.4334, 4599, 5305 of 2017, Civil
Appeal Nos.3231, 3232, 3233 of 2019 @ SLP (C) Nos 10248, 10247, 17500 of 2017
and Civil Appeal No 7076 of 2017
J U D G M E N T
Dr Dhananjaya Y Chandrachud, J.
1 Leave granted in the Special Leave Petitions.
2 This batch of appeals involves the interpretation of a cluster of provisions of
1
the Income Tax Act 19611
, particularly Section 142(2C). A Division Bench of the
Delhi High Court by its judgment dated 27 May 2011 dismissed a batch of appeals
filed by the Revenue against an order dated 18 September 2009 of the Income Tax
Appellate Tribunal2
. The Tribunal came to the conclusion that prior to the insertion of
the expression “suo motu” with effect from 1 April 2008 in Section 142(2C), the
assessing officer had no jurisdiction to extend time for the submission of the report
of an auditor appointed under sub section (2A), of his own accord. As a
consequence, it was held that the assessment which was made under Section
153A, in respect of the assessment years in question, was barred by limitation.
3 In the present batch of cases, the submission of the assessees is that the
assessing officer had no jurisdiction or authority under Section 142 (2C), as it stood
prior to 1 April 2008, to extend time for the submission of the audit report of the
auditor appointed under the provisions of sub section (2A). In essence, the
submission is that the assessing officer was authorized to extend time (not
exceeding 180 days) from the date on which a direction under sub section (2A) was
received by the assessee, only on an application made by the assessee and for any
good and sufficient reason. If the assessee made no application, the assessing
officer would have no jurisdiction – according to the assessees – to extend time.
1 “IT Act 1961”
2 “Tribunal”
2
4 The Revenue adopted a contrary position, submitting that even before 1 April
2008, the jurisdiction of the assessing officer to extend time for the submission of the
audit report was not confined to a situation in which the assessee had made an
application for extension. Consequently, the incorporation of a provision for a suo
motu exercise of power by the assessing officer, with effect from 1 April 2008 by the
Finance Act, 20083
, was only intended to remove an ambiguity and was clarificatory
in nature.
5 Section 142(2A) as it stood at the material time, provided as follows:
“(2A) – If, at any stage of the proceedings before him, the
Assessing Officer, having regard to the nature and complexity of
the accounts of the assessee and the interests of the revenue, is
of the opinion that it is necessary so to do, he may, with the
previous approval of the Chief Commissioner of Commissioner,
direct the assessee to get the accounts audited by an accountant,
as defined in the Explanation below sub-section (2) of section
288, nominated by the Chief Commissioner or Commissioner in
this behalf and to furnish a report of such audit in the prescribed
form - duly signed and verified by such accountant and setting
forth such particulars as may prescribed and such other
particulars as the Assessing Officer may require:
Provided that the Assessing Officer shall not direct the assessee
to get the accounts so audited unless the assessee has been
given a reasonable opportunity of being heard.”
Sub section (2C) of Section 142 was in the following terms:
“(2C) Every report under sub-section (2A) shall be furnished by
the assessee to the Assessing Officer within such period as may
be specified by the Assessing Officer:
Provided that the Assessing Officer may, on an application made
in this behalf by the assessee and for any good and sufficient
reason, extend the said period by such further period or periods
as he thinks fit; so, however, that the aggregate of the period
originally fixed and the period or periods so extended shall not, in
any case, exceed one hundred and eighty days from the date on
which the direction under sub-section (2A) is received by the
assessee.”
6 Consequent to the Finance Act, sub section (2C) was amended to read as
3 “Finance Act”
3
follows:
“(2C) Every report under sub-section (2A) shall be furnished by
the assessee to the Assessing Officer within such period as may
be specified by the Assessing Officer:
Provided that the – Assessing Officer may, suo motu, or on an
application made in this behalf by the assessee and for any good
and sufficient reason, extend the said period by such further
period or periods as he thinks fit; so, however, that the aggregate
of the period originally fixed and the period or periods so
extended shall not, in any case, exceed one hundred and eighty
days from the date on which the direction under sub-section (2A)
is received by the assessee.”
7 Section 153B prescribes time limits for the completion of assessments under
Section 153A. Explanation (ii), as it stood at the material time, provided that in
computing the period of limitation for the purposes of the Section, “the period
commencing from the day on which the Assessing Officer directs the assessee to
get his accounts audited under sub-section (2A) of Section 142 and ending on the
day on which the assesse is required to furnish a report of such audit under that
sub-section” shall be excluded. While issuing a direction under sub section (2A) of
Section 142, the assessing officer was vested with the authority to require the
assessee to furnish a report of the audit in the prescribed form, signed and verified
by the accountant, and setting forth such particulars as may be prescribed and as
may be required by him. The substantive part of sub section (2C) mandates that the
report under sub section (2A) shall be furnished by the assessee to the assessing
officer within the period that is specified by the assessing officer under the proviso,
as it stood prior to its amendment by the Finance Act. The assessing officer was
further empowered, on an application made by the assessee and for any good and
sufficient reason, to extend the period further, subject to the stipulation that it shall
4
not exceed an aggregate of 180 days from the date on which the direction under sub
section (2A) has been received by the assessee.
8 The crucial words which fall for interpretation are “On an application made in
this behalf by the assessee and for any good and sufficient reason…”
9 Simply stated, the contention of the assessees is that the above words
indicate that the assessing officer may extend the period, which has been specified
under the substantive part of sub section (2C), only on an application made by the
assessee and for good and sufficient reason. Contrariwise, according to the
Revenue, the assessing officer, who issues a direction to the assessee under sub
section (2A) to get his accounts audited, is vested with the authority to specify the
period for the submission of the report, and within the overall limit of 180 days it is
open to the assessing officer to extend the time which has been fixed in the first
instance. The Revenue posits that the authority conferred upon the assessing officer
to extend time, on an application made by the assessee, does not take away the
authority of the assessing officer, who has prescribed the time for the submission of
the report in the first instance, to extend time without an application for extension
being made by the assessee, subject to the overall ceiling of 180 days. In the
submission of the Revenue, the expression “and for any good and sufficient reason”
must be construed logically to mean “or for any good and sufficient reason”.
10 The submission which has been urged on behalf of the assessees is sought
to be buttressed by adverting to the legislative intent behind the insertion of the term
“suo motu” in the provisions of Section 142(2C) by the Finance Act. Circular No
5
1/2009 dated 27 March 2009 contains the following explanation for the amendments
made to Section 142(2C):
“27. Granting of power to the Assessing Officer to extend the
time for completion of special audit under sub-section (2A)
of section 142
27.1 Sub-sections (2A) to (2D) of section 142 deal with
power of Assessing Officer to order a special audit. Such power is
required to be exercised by the Assessing Officer having regard
to the nature and complexity of the accounts of the assessee and
the interest of the revenue.
27.2 Sub-section (2C) of the said section specifies the
period within which the audit reports is to be furnished. The
proviso to said sub-section empowers the Assessing Officer to
extend this period of furnishing of audit report. Further, it is also
provided that the aggregate of the originally fixed period and the
period(s) so extended shall not exceed 180 days from the date of
issuance of direction of special audit. Further, such extension can
be made only when an application is made in this behalf by the
assessee and there are good and sufficient reasons for such
extension.
27.3 With a view to rationalise the said proviso so as to
also allow the Assessing Officer to extend this period of furnishing
of audit report suo motu, the said proviso has been amended.
Hence, while the Assessing Officer shall continue to have power
to grant extension on an application made in this behalf by the
assessee and when there are good and sufficient reasons for
such extension, he can also grant such extension on his own.
27.4 Applicability – This amendment has been made
applicable with effect from 1-4-2008. Hence, from this date and
onwards, the Assessing Officer shall also have power to extend
the period of furnishing of audit report suo motu.”
11 The Notes on clauses to the Finance Bill, 2008 contain the following
explanation:
“Clause 28 seeks to amend section 142 of the Income-tax Act,
which relates to enquiry before assessment.
Sub-sections (2A) to (2D) of the said section deal with power of
Assessing Officer to order special audit, where the nature and
complexity of the accounts requires such audit, to seek the
assistance of a chartered accountant.
Sub-section (2C) of the said section specifies the period within
which the audit report is to be furnished. The Proviso to the said
sub-section provides that the Assessing Officer may extend the
6
said period of furnishing of audit report, on an application made in
this behalf, by the assessee and for any good and sufficient
reason.
It is proposed to amend the said proviso so as to provide that the
Assessing Officer may, suo motu, or on an application made in
this behalf by the assessee, and for any good and sufficient
reason, extend the said period by such further period or periods
as he thinks fit.
This amendment will take effect from 1st April, 2008.”
The Memorandum accompanying the Finance Act similarly provides:
“Granting of power to the Assessing Officer to extend the
time for completion of special audit under sub-section (2A)
of section 142
Sub-sections (2A) to (2D) of section 142 deal with power of
Assessing Officer to order a special audit. Such power is required
to be exercised by the Assessing Officer having regard to the
nature and complexity of the accounts of the assessee and the
interest of the revenue.
Sub-section (2C) of the said section specifies the period within
which the audit report is to be furnished. The proviso to said subsection empowers the Assessing Officer to extend this period of
furnishing of audit report. Further, it is also provided that the
aggregate of the originally fixed period and the period(s) so
extended shall not exceed 180 days from the date of issuance of
direction of special audit. Further, such extension can be made
only when an application is made in this behalf by the assessee
and there are good and sufficient reasons for such extension.
It is proposed to amend the said proviso so as to also allow the
Assessing Officer to extend this period of furnishing of audit
report suo motu. Hence, while the Assessing Officer shall
continue to have power to grant extension on an application
made in this behalf by the assessee and when there are good
and sufficient reasons for such extension, he can also grant such
extension on his own.
The amendment will take effect from 1st April, 2008.”
12 In the context of the above background, it has been submitted that the
purpose of the amendment was to “also allow the assessing officer to extend the
7
period for furnishing of an audit report, suo motu”. The amendment to Section
142(2C) preserves the jurisdiction of the assessing officer to grant an extension on
an application made by the assessee and for any good and sufficient reasons. In
addition, the amendment allows the assessing officer to extend the period suo motu.
The amendment having taken effect from 1 April 2008, it has been urged on behalf
of the assessees that this power was not vested in the assessing officer prior to that
date. Moreover, learned counsel appearing on behalf of the assessee urged that:
(i) The consequence of the exercise of the jurisdiction to extend time for
submission of the audit report under the proviso to sub section (2C) is the
extension of the period of limitation for the completion of an assessment
under Explanation (ii) to Section 153B. This is indicative of the fact that the
provision for extension is not procedural in nature;
(ii) The consequence of the failure of the assessee to comply with the direction of
submitting the audit report by the date prescribed by the assessing officer is
that under Section 144(1)(b), the assessing officer is empowered to frame
a best judgment assessment;
(iii) The expression in Explanation (ii) to Section 153B “ending on the date on
which the assesse is required to furnish a report of such audit” signifies the
end of the period of exclusion of time for the framing of an assessment under
Section 153B;
(iv) Section 142(2C) must consequently be interpreted in the context of the
provisions of Sections 153B and 144; and
(v) The expression ‘and’ in the substantive part of Section 142(2A) has been
held to be conjunctive by the decision of this Court in Sahara India (Firm),
8
Lucknow v Commissioner of Income Tax, Central-I4
. The expression ‘and’
in the proviso to sub-section 2C must be given the same meaning.
13 On the other hand, it has been submitted on behalf of the Revenue that:
(i) In construing the proviso to Section 142(2C), it is primarily the language of the
statutory provision which must be construed;
(ii) The amendment to sub section (2C) was necessitated by reason of the
ambiguity in the provision as it stood prior to 1 April 2008;
(iii) The legislature having stepped in to remove an ambiguity, the amendment
brought about by the Finance Act must necessarily be regarded as
clarificatory in nature; and
(iv) The amendment is purely procedural and must be retrospective in character.
14 The rival submissions now fall for consideration.

15 Sub-section (2A) of Section 142 empowers the assessing officer to direct the
assessee to get the accounts audited by an accountant, on the formation of an
opinion that the conditions specified in the provision for recourse to the power are
fulfilled. The power to order an audit is vested with the assessing officer. As a
necessary incident of this power, sub-section (2C) imposes an obligation on the
assessee to furnish the report to the assessing officer within the period which is
specified by the assessing officer. The substantive part of sub-section (2C) places
an obligation on the assessee to comply with the time schedule which is prescribed
by the assessing officer. The overall ceiling of time appears in the proviso to subsection (2C), which mandates that the aggregate of the time fixed and the extended
period cannot exceed 180 days, after which there can be no further extension of
4 (2008) 14 SCC 151
9
time.
16 The submission of the assessee would have this Court interpret the proviso to
mean that the assessing officer can extend the period which was originally fixed only
on the request of the assessee. Besides leading to absurd consequences, such a
construction of the proviso is patently contrary to its language, purpose and
intendment.
17 The proviso was intended to deal with a situation where an assessee, for valid
reasons, may not be able to furnish the audit report within the period that was fixed
by the assessing officer. The enactment of the proviso was necessary to give a
remedy to an assessee who, for genuine reasons, is unable to comply with the
direction issued in the first instance by the assessing officer. Hence, the proviso
stipulates that for good and sufficient reason, the assessing officer may extend time
on an application submitted by the assessee. The “good and sufficient reason”
requirement is intended to ensure that an extension of time cannot be demanded by
the assessee as a matter of right. Indeed, the use of the expression ‘may’ indicates
that whether or not time should be extended is discretionary. The discretion is
intimated to the Assessing officer.
18 In determining whether the power to extend time vests in the assessing officer
in a situation where the assessee has not made an application for extension, it is
well to remember that under the substantive part of sub-section (2C), the assessing
officer can fix time for the submission of the audit report. Subject to an overall limit of
180 days, the assessing officer is fully clothed with the authority to determine the
10
time within which the audit report should be submitted. For instance, the assessing
officer may in a given case consider the grant of 90 days as adequate for the
completion of the exercise. Though the assessing officer has the power, in the first
instance, to fix an even longer period subject to the overall ceiling of time, she may
fix a particular period within the limit. To then postulate that while the assessing
officer could in the first instance have fixed a longer time limit but, having fixed a limit
of time, is precluded from extending time thereafter would be an absurd course of
interpretation. The assessing officer while fixing time in the first instance will do so
on an estimate of the reasonable time which is likely to be taken in completing the
exercise and submitting an audit report. The exigencies of the situation may
however require an extension of time for genuine reasons or, as the statute calls it,
“for any good and sufficient reason”.
19 There are two ways of looking at the situation. Firstly, the proviso to subsection (2C) creates a remedy for an assessee to apply for extension where, for a
good and sufficient reason, the audit report could not be submitted. Otherwise, the
assessee may face a penalty under Section 271 apart from being subjected to a
best judgment assessment under Section 144. By extending time at the behest of
the assessee, the assessing officer allows the original order calling for an audit
report to be duly implemented. The creation of a remedy under the proviso in favour
of the assessee cannot be construed to detract from the authority which vests in the
assessing officer, who has specified the time limit for the submission of an audit
report in the first instance, to extend time without an application by the assessee. To
hold otherwise, and to construe the proviso to sub-section (2C) as foreclosing the
11
authority of the assessing officer to extend time without a request by the assessee,
would lead to an absurd consequence. The assessee would then be in control of
whether or not to seek an extension of time, where the audit report has not been
finalized. Even if the auditor, for genuine reasons (not bearing on the default of the
assessee), was unable to comply with the time schedule, having regard to the
nature or complexity of the accounts, the assessee would then have a sole and
unrestricted power to determine whether an extension should be sought. Not
seeking an extension would in effect defeat the underlying purpose and object of
directing the assessee to obtain a report of an auditor under sub-section (2A). The
legislature could not have intended this consequence. An interpretation which would
defeat the purpose underlying sub-section (2A) must be avoided. The assessing
officer who has fixed the time in the first instance must necessarily, as an incident of
the authority to fix time, be entitled to extend time without an application by the
assessee. While extending time, the assessing officer will be subject to the overall
ceiling of time fixed under the proviso to sub section 2C.
20 Secondly, the alternate construction of the proviso is that the expression “and
for any good and sufficient reason” should be read to mean “or for any good and
sufficient reason”. As a matter of statutory interpretation, it is well settled that the
expression “and” can in a given context be read as “or” (see in this context Ishwar
Singh Bindra v State of UP5
). This submission was opposed on behalf of the
assessees by urging that in the context of sub-section (2A), it has been held by this
Court in Sahara India (Firm), Lucknow v CIT (supra) that the word “and” is used in
5 (1969) 1 SCR 219 = AIR 1968 SC 1450
12
the conjunctive sense. Undoubtedly the expression “and” in sub-section (2A) has
been held to the conjunctive, while delineating the circumstances on the basis of
which an opinion can be arrived at by the assessing officer. This would not
necessarily furnish an index to how the expression “and” in the proviso to subsection (2C) should be construed. The interpretation of the expression must be
based on the context in which it is used. In the proviso to sub-section (2C), the
expression “and” is used in connection with the grant of an extension of time and not
in the context of the formation of an opinion for ordering a special audit. The power
is of a procedural nature.
21 The learned counsel for the assessees sought to urge that the legislative
history surrounding the amendment to the proviso to sub-section (2C) by the
Finance Act would indicate that the amendment was intended to be prospective with
effect from 1 April 2008 and, that prior to this date, the assessing officer had no
jurisdiction to grant an extension of time, save on the application by the assessee.
Circular 1/2009 dated 27 March 2009 indicates that the amendment was brought
about “with a view to rationalize the said proviso”. Learned counsel argued that the
expression in Circular 1/2009 that the amendment was to also allow the assessing
officer to extend the period for furnishing of the audit report suo motu, indicates that
such a power did not exist prior to the amendment. The submission cannot be
accepted. The mere fact that the amendment has been made with effect from 1 April
2008 does not detract from it being clarificatory in nature or that it was designed to
obviate an ambiguity. In Justice GP Singh’s Principles of Statutory Interpretation6
6 11th Edition (2008)
13
the issue of whether a statutory provision is retrospective has been analysed thus:
““The presumption against retrospective operation is not
applicable to declaratory statutes. As stated in Craies and
approved by the Supreme Court: ‘For modern purposes a
declaratory Act may be defined as an Act to remove doubts
existing as to the common law, or the meaning or effect of any
statute. Such Acts are usually held to be retrospective. The usual
reason for passing a declaratory Act is to set aside what
Parliament deems to have been a judicial error, whether in the
statement of the common law or in the interpretation of statutes.
Usually, if not invariably, such an Act contains a preamble, and
also the word “declared” as well as the word “enacted”.’ But the
use of the words ‘it is declared’ is not conclusive that the Act is
declaratory for these words may, at times, be used to introduce
new rules of law and the Act in the latter case will only be
amending the law and will not necessarily be retrospective. In
determining, therefore, the nature of the Act, regard must be had
to the substance rather than to the form. If a new Act is ‘to
explain’ an earlier Act, it would be without object unless construed
retrospective. An explanatory Act is generally passed to
supply an obvious omission or to clear up doubts as to the
meaning of the previous Act. It is well settled that if a statute is
curative or merely declaratory of the previous law retrospective
operation is generally intended. The language ‘shall be deemed
always to have meant’ or ‘shall be deemed never to have
included’ is declaratory, and is in plain terms retrospective. In the
absence of clear words indicating that the amending Act is
declaratory, it would not be so construed when the amended
provision was clear and unambiguous. An amending Act may be
purely clarificatory to clear a meaning of a provision of the
principal Act which was already implicit. A clarificatory
amendment of this nature will have retrospective effect ….”
 (emphasis supplied)
The above extract was cited by this Court in Commissioner of Income Tax-1,
Ahmedabad v Gold Coin Health Food Pvt Ltd7
. A Constitution Bench of this Court
also cited the above extract with approval in Commissioner of Income Tax
(Central – I) v Vatika Township (P) Ltd.8
.
22 The Notes on Clauses as well as the Memorandum to the Finance Act do not
7 2008 (9) SCC 622
8 [2014] 31 ITR 466 (SC); 2015 1 SCC 1
14
indicate a contrary hypothesis. The reason for the introduction of the amendment
arose because of the element of ambiguity inherent in the erstwhile position as it
stood before 1 April 2008. The ambiguity was precisely on the question as to
whether the assessing officer was precluded from granting an extension of time of
his own accord merely because the assessee was permitted to apply for an
extension. Since the purpose of the amendment was to remove this ambiguity, we
are clearly of the view that by the Finance Act, Parliament essentially clarified the
position as it existed prior to the amendment.
23 Moreover, there exists a presumption of retrospective application in regard to
amendments which are of a procedural nature. This position was stated in Maxwell
on The Interpretation of Statutes9
:
“The general principle, however, seems to be that alterations in
procedure are retrospective, unless there be some good reason
against it.”
In Commissioner of Income Tax (Central – I) v Vatika Township (P) Ltd. (supra),
this Court held thus:
“30. We would also like to point out, for the sake of completeness,
that where a benefit is conferred by a legislation, the rule against
a retrospective construction is different. If a legislation confers a
benefit on some persons but without inflicting a
corresponding detriment on some other person or on the
public generally, and where to confer such benefit appears to
have been the legislators' object, then the presumption
would be that such a legislation, giving it a purposive
construction, would warrant it to be given a retrospective
effect. This exactly is the justification to treat procedural
provisions as retrospective…
9 11th Edition, Sweet and Maxwell (1962) at pg 217
15
31… Thus, the rule against retrospective operation is a
fundamental rule of law that no statute shall be construed to have
a retrospective operation unless such a construction appears very
clearly in the terms of the Act, or arises by necessary and distinct
implication. Dogmatically framed, the rule is no more than a
presumption, and thus could be displaced by outweighing
factors.”
(emphasis supplied)
24 We find no substance in the submission urged on behalf of the assessees that
to adopt an interpretation which we have placed on the provisions of Section
142(2C) would enable the assessing officer to extend the period of limitation for
making an assessment under Section 153B. Explanation (iii) to Section 153B(1), as
it stood at the material time, provided for the exclusion of the period commencing
from the date on which the assessing officer had directed the assessee to get his
accounts audited under sub-section (2A) of Section 142 and ending on the day on
which the assesee is required to furnish a report under that sub-section. The day on
which the assessee is required to furnish a report of the audit under sub-section (2A)
marks the culmination of the period of exclusion for the purpose of limitation. Where
the assessing officer had extended the time, the period, commencing from the date
on which the audit was ordered and ending with the date on which the assessee is
required to furnish a report, would be excluded in computing the period of limitation
for framing the assessment under Section 153B. The principle governing the
exclusion of time remains the same. The act on which the exclusion culminates is
the date which the assessing officer fixes originally, or on extension for submission
of the report.
16
25 The issue as to whether the amendment which has been brought about by the
legislature is intended to be clarificatory or to remove an ambiguity in the law must
depend upon the context. The Court would have due regard to (i) the general scope
and purview of the statute; (ii) the remedy sought to be applied; (iii) the former state
of the law; and (iv) what power that the legislature contemplated (See Zile Singh v
State of Haryana10). The decision in Sedco Forex International Drill Inc. v
Commissioner of Income Tax11 on which learned counsel for the assesses relied
involved a substitution of the Explanation to Section 9(1)(ii) of the IT Act, 1961 with
effect from 1 April 2000. A two Judge Bench of this Court held that given the
legislative history of Section 9(1)(ii), it can only be assumed that it was deliberately
introduced with effect from 1 April 2000 and was therefore intended to be
prospective. This was also so construed by the CBDT, and in the explanatory notes
to the provisions of the Finance Act, 1999. As we have indicated, interpretation is a
matter of determining the path on the basis of statutory context and legislative
history. In taking the view that we have, we have also taken note of the fact that the
same view was adopted by several High Courts. Among them are (i) the Punjab and
Haryana High Court in Jagatjit Sugar Mills Co Ltd v Commissioner of Income
Tax12; (ii) the Kerala High Court in Commissioner of Income Tax, Cochin v
Popular Automobiles13; and (iii) the Allahabad High Court in Ghaziabad
10 (2004) 8 SCC 1
11 [2005] 279 ITR 310 (SC); (2005) 12 SCC 717
12 (1994) 74 Taxman 8 (Pun.&Har.); [1994] 210 ITR 468
13 (2011) 333 ITR 308
17
Development Authority v Commissioner of Income Tax, Ghaziabad (UP)14
. The
decision of the Kerala High Court in Popular Automobiles (supra) is the subject
matter of Civil Appeal No 2951 of 2012 in these proceedings.
26 For the reasons we have adduced, we have come to the conclusion that the
provisions of Section 142(2C) of the Income Tax Act 1961, as they stood prior to the
amendment which was enacted with effect from 1 April 2008 by the Finance Act,
2008 did not preclude the exercise of jurisdiction and authority by the assessing
officer to extend time for the submission of the audit report directed under subsection (2A), without an application by the assessee. We hold and declare that the
amendment was intended to remove an ambiguity and is clarificatory in nature. As a
consequence of our decision, we specifically overrule the judgment of a Division
Bench of the Delhi High Court in Commissioner of Income Tax v Bishan Swaroop
Ram Kishan Agro Pvt. Ltd.15 dated 27 May 2011.
27 Accordingly, Civil Appeals @ SLP (C) Nos 6082, 7573, 8761 and C.A. No.
2951 of 2012 are restored to the file of the Commissioner of Income Tax (Appeals)
for decision on merits. Civil Appeals @ SLP(C) Nos 2808, 2811, 36496, 6680,
36495, 11869, 12026, 12027, 10191, 10190, 9720, 8512, 2810, 7660, 9463, 16130,
27681 of 2012; Civil Appeal Nos 4599, 4334, 7076 of 2017; Civil Appeals @ SLP(C)
Nos 17500, 10248, 10247 of 2017 and C.A. No. 5305 of 2017 are restored to the file
of the Income Tax Appellate Tribunal for decision on merits.
14 (2011) 12 Taxman.com 334 (Allahabad); 2011 SCC On Line All 1151
15 [2011] 203 TAXMAN 326 (Delhi) – ITA No. 1775/2010 - 2011 SCC Online Del 2463
18

28 There shall be no order as to costs.
 ............................................................J
 [Dr Dhananjaya Y Chandrachud]
...........................................................J
 [Hemant Gupta]
New Delhi;
March 26, 2019
19

whether a direction for the deletion of the second respondent was warranted. We may note the submission which has been urged on behalf of the appellants to the effect that under Section 2(zk) of the Real Estate (Regulation and Development) Act, 2016, the definition of the expression “promoter” would include the entity which is constructing the building as well as the entity which is selling the apartments or plots. Section 2(zk) reads as follows:- “(zk) "promoter" means,— (i) a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or (ii) a person who develops land into a project, whether or not the person also constructs structures on any of the plots, for the purpose of selling to other persons all or some of the plots in the said project, whether with or without structures thereon; or (iii) any development authority or any other public body in respect of allottees of— (a) buildings or apartments, as the case may be, constructed by such authority or body on lands owned by them or placed at their disposal by the Government; or (b) plots owned by such authority or body or placed at their disposal by the Government, for the purpose of selling all or some of the apartments or plots; or 5 (iv) an apex State level co-operative housing finance society and a primary co-operative housing society which constructs apartments or buildings for its Members or in respect of the allottees of such apartments or buildings; or (v) any other person who acts himself as a builder, coloniser, contractor, developer, estate developer or by any other name or claims to be acting as the holder of a power of attorney from the owner of the land on which the building or apartment is constructed or plot is developed for sale; or (vi) such other person who constructs any building or apartment for sale to the general public. Explanation.— For the purposes of this clause, where the person who constructs or converts a building into apartments or develops a plot for sale and the persons who sells apartments or plots are different persons, both of them shall be deemed to be the promoters and shall be jointly liable as such for the functions and responsibilities specified, under this Act or the rules and regulations made thereunder;” On the basis of the material which is on record, it is not possible for the Court to conclude at the present stage that the second respondent is unconnected with the project or has been impleaded as a party to the proceeding without any reason or basis. The issue as to whether, and if so, what relief can be ultimately granted in the consumer complaint is a matter which will be determined during the course of the hearing of the complaint. Consequently, we are of the view that on the basis of the averments contained in the complaint as well as on the material which has been placed on the record by the second respondent, an order for deletion was not warranted at this stage.

1
REPORTABLE
 IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
 CIVIL APPEAL NO(S). 259 OF 2019
ASSOCIATION FOR CONSUMER WELFARE AND AID Appellant(s)
 VERSUS
GRANITE GATE PROPERTIES PRIVATE LIMITED & ANR. Respondent(s)
WITH
CIVIL APPEAL NO(S). 1501 OF 2019
JUDGMENT
Dr. Dhananjaya Y. Chandrachud, J.
Civil Appeal No. 259 of 2019
Admitted.
By the impugned order dated 31 July 2018, the National
Consumer Disputes Redressal Commission1 directed that the second
respondent (Three C Universal Developers Private Limited) be
deleted from the array of parties. The complaint has been
admitted only against Granite Gate Properties Private Limited,
the first respondent to the present appeal.
The only ground on which the above directions have been
issued are spelt out thus:
“The consumers on whose behalf this complaint is
instituted did not hire or avail the services of
opposite party No. 1 and therefore, they cannot
be said to its consumers.”
Notice was issued in these proceedings on 7 January 2019.
1 “NCDRC”
2
A counter affidavit has been filed by the second respondent
which was ordered to be deleted by the NCDRC from the array of
parties.
The consumer complaint filed by the appellant, which is
an association representing the buyers, seeks diverse reliefs
including the grant of possession of flats to the allottees of
the real estate project together with common amenities and
restraining the respondents from charging additional amounts
for alleged increases in the area of the flats otherwise than
in accordance with the allotment letters. The averments in
paragraphs 5 and 13 of the complaint before the NCDRC read as
follows:
“5. That the Allotment Letters clearly provide
that the projects are being undertaken by
Opposite Part 2 (which is formed by Opposite
Party 1 specifically for the purpose of
construction of Lotus Panache). The entire
consideration amount for the project was required
to be paid to Opposite Party 2 by the allottees,
although the project was marketed by Opposite
Party 1 and the parties marketed themselves as
“The 3C Company” which is also evident from the
letterhead of the Company on which the Allotment
Letters were printed.”
13. The Companies registered project Lotus
Panache under Uttar Pradesh Real Estate
Regulatory Authority and M/s Granite Gate
Properties Pvt. Ltd. was declared by the
Companies as the Promoter of the project.
However clearly as per the agreement, Three C
Universal Developers Private Limited was the main
company as it has formed the SPC (which was
formed specifically for development of the
project Lotus Panache and was the one which was
marketing and executing the agreements),
therefore having been vested the primary
responsibility of the entire project together
with all the other opposite parties who also are
jointly and severally responsible for all the
obligations contained herein.
3
Further, the details of Project Lotus Panache as
obtained from the website of Uttar Pradesh Real
Estate Regulation Authority clearly shows the
proposed date of completion of the project as
31.12.2022. Surprisingly, the original start
date has been specified as 11.5.2010 and the
modified start date for the project has been
specified as 10.8.2017.”
In sum and substance therefore, the case of the
appellants before the NCDRC is that the second respondent,
Three C Universal Developers Private Limited, is in fact the
main promoter of the project and that it is vested with the
primary responsibility of completing the project. Para 17.1
of the complaint reads as follows:
“17.1 The Opposite Parties state that the
Allottees had entered into Agreements with only
Opposite Party 2 and no one else. However,
clearly Opposite Party 1 and Opposite Party 2
have been acting as one and the same Company.
Opposite Party 1 has admittedly marketed the
Project and the Companies have represented
themselves together as “The 3C Company”. The
allotment letter names Opposite Party 1 as one of
the Parties and the Builder Buyer Agreement
specifically recognises that Opposite Party 2 is
only a Special Purpose Company formed by the
Opposite Party 1 for a particular purpose.“
 In the complaint before the NCDRC, Three C Universal
Developers Pvt. Ltd. (the second respondent to the present
appeal) is arrayed as opposite party No. 1, while Granite Gate
Properties Pvt. Ltd. (the first respondent to the present
appeal) is opposite party No. 2.
In the counter affidavit which has been filed in these
proceedings, the second respondent has stated that the first
respondent was set up as a special purpose vehicle by a
consortium of which the second respondent is a part. Moreover,
4
it has been stated that a construction agreement was entered
into between the first and second respondents on 15 December
2009.
At the present stage, the limited issue with which this
Court is concerned is whether a direction for the deletion of
the second respondent was warranted.
We may note the submission which has been urged on behalf
of the appellants to the effect that under Section 2(zk) of the
Real Estate (Regulation and Development) Act, 2016, the
definition of the expression “promoter” would include the
entity which is constructing the building as well as the entity
which is selling the apartments or plots.
Section 2(zk) reads as follows:-
“(zk) "promoter" means,— (i) a person who
constructs or causes to be constructed an
independent building or a building consisting of
apartments, or converts an existing building or a
part thereof into apartments, for the purpose of
selling all or some of the apartments to other
persons and includes his assignees; or
(ii) a person who develops land into a project,
whether or not the person also constructs
structures on any of the plots, for the purpose of
selling to other persons all or some of the plots
in the said project, whether with or without
structures thereon; or
(iii) any development authority or any other
public body in respect of allottees of—
(a) buildings or apartments, as the case may be,
constructed by such authority or body on lands
owned by them or placed at their disposal by the
Government; or
(b) plots owned by such authority or body or
placed at their disposal by the Government, for
the purpose of selling all or some of the
apartments or plots; or
5
(iv) an apex State level co-operative housing
finance society and a primary co-operative housing
society which constructs apartments or buildings
for its Members or in respect of the allottees of
such apartments or buildings; or
(v) any other person who acts himself as a
builder, coloniser, contractor, developer, estate
developer or by any other name or claims to be
acting as the holder of a power of attorney from
the owner of the land on which the building or
apartment is constructed or plot is developed for
sale; or
(vi) such other person who constructs any building
or apartment for sale to the general public.
Explanation.— For the purposes of this clause,
where the person who constructs or converts a
building into apartments or develops a plot for
sale and the persons who sells apartments or plots
are different persons, both of them shall be
deemed to be the promoters and shall be jointly
liable as such for the functions and
responsibilities specified, under this Act or the
rules and regulations made thereunder;”
On the basis of the material which is on record, it is
not possible for the Court to conclude at the present stage
that the second respondent is unconnected with the project or
has been impleaded as a party to the proceeding without any
reason or basis. The issue as to whether, and if so, what
relief can be ultimately granted in the consumer complaint is a
matter which will be determined during the course of the
hearing of the complaint.
Consequently, we are of the view that on the basis of the
averments contained in the complaint as well as on the material
which has been placed on the record by the second respondent,
an order for deletion was not warranted at this stage.
6
We accordingly, allow the appeal and set aside the
impugned order of the NCDRC dated 31 July 2018. The second
respondent is accordingly restored as a party to the
proceedings before the NCDRC. The complaint shall stand
admitted against both the first and second respondents for
final disposal.
We however, clarify that all the rights and contentions
of the parties are kept open to be urged before the NCDRC.
The appeal is, accordingly, disposed of. There shall be
no order as to costs.
Pending application(s), if any, shall also stand disposed
of.
Civil Appeal No. 1501 of 2019
Admitted.
For the reasons indicated by this Court while disposing
of the companion civil appeal (Civil Appeal No. 259 of 2019),
the order of the NCDRC dated 20 July 2018 directing the
deletion of Three C Universal Developer Pvt. Ltd. is set aside.
The appeal shall stand disposed of in similar terms as
the order passed in the companion appeal. There shall be no
order as to costs.
Pending application(s), if any, shall stand disposed of.
.............................J.
 (DR. DHANANJAYA Y. CHANDRACHUD)
..............................J.
 (HEMANT GUPTA)
 NEW DELHI
 MARCH 25, 2019
7
ITEM NO.44 COURT NO.8 SECTION XVII
 S U P R E M E C O U R T O F I N D I A
 RECORD OF PROCEEDINGS
Civil Appeal No(s). 259/2019
ASSOCIATION FOR CONSUMER WELFARE AND AID Appellant(s)
 VERSUS
GRANITE GATE PROPERTIES PRIVATE LIMITED & ANR. Respondent(s)
(IA 183287/2018, IA 183289/2018)
WITH
C.A. No. 1501/2019 (XVII)
(IA 620/2019)
Date : 25-03-2019 These matters were called on for hearing today.
CORAM : HON'BLE DR. JUSTICE D.Y. CHANDRACHUD
 HON'BLE MR. JUSTICE HEMANT GUPTA
For Appellant(s)
Mr. Avi Tandon, Adv.
Mr. Anish Agarwal, Adv.
Mr. Omar Waziri, Adv.
Ms. Vanshika Gupta, Adv.
Ms. Meghna Tandon, Adv.
 Ms. Vibhooti Malhotra, AOR
For Respondent(s)
 Mr. Dhananjai Jain, AOR
Mr. George Thomas, Adv.
Mr. Dhananjay, Adv.
Mr. Nakul Dewan, Adv.
Mr. Arush Khanna, Adv.
Ms. Nooreen Sarna, Adv.
Mr. Lakshay Mehta, Adv.
 UPON hearing the counsel the Court made the following
 O R D E R
Admitted.
The appeals are disposed of in terms of the signed order.
Pending application(s), if any, shall stand disposed of.
(MANISH SETHI) (SAROJ KUMARI GAUR)
COURT MASTER (SH) BRANCH OFFICER
(Signed reportable judgment is placed on the file)

whether the buyer was entitled to seek a refund or was estopped from doing so, having claimed compensation as the primary relief in the consumer complaint.= In terms of the agreement, the date for handing over possession was 31 December 2008, with a grace period of six months. Even in 2011, when the buyer filed a consumer complaint, he was ready and willing to accept possession. It would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession. By 2016, nearly seven years had elapsed from the date of the agreement. Even according to the developer, the completion certificate was received on 29 March 2016. This was nearly seven years after the extended date for the handing over of possession prescribed by the agreement. A buyer can be expected to wait for possession for a reasonable period. A period of seven years is beyond what is reasonable. Hence, it would have been manifestly unfair to non-suit the buyer merely on the basis of the first prayer in the reliefs sought before the SCDRC. There was in any event a prayer for refund. In the circumstances, we are of the view that the orders passed by the SCDRC and by the NCDRC for refund of moneys were justified. Having regard to all the facts and circumstances of the case, we modify the order of the NCDRC by directing that the appellant shall pay interest at the rate of 9% per annum to the respondent instead and in place of 12% as directed by the NCDRC. Save and except for the above modification, we affirm the directions of the NCDRC.

1
REPORTABLE
 IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
 CIVIL APPEAL NO. 3182 OF 2019
 (@SLP(C) No(s). 1795 OF 2017)
KOLKATA WEST INTERNATIONAL CITY PVT LTD Appellant(s)
 VERSUS
DEVASIS RUDRA Respondent(s)
JUDGMENT
Dr. Dhananjaya Y. Chandrachud, J.
Leave granted.
This appeal arises from the judgment dated 21 November
2016 of the National Consumer Disputes Redressal Commission1.
A Buyer’s Agreement dated 2 July 2007 was entered into
between the appellant and the respondent.
The respondent paid an amount of Rs 39,29,280 in 2006 in
terms of a letter of allotment dated 20 September 2006. The
agreement between the parties envisaged that the appellant
would hand over possession of a Row House to the respondent by
31 December 2008 with a grace period of a further six months
ending on 30 June 2009.
The respondent filed a consumer complaint before the West
Bengal State Consumer Disputes Redressal Commission2 in 2011
1 “NCDRC”
2 “SCDRC”
2
praying for possession of the Row House and in the alternative
for the refund of the amount paid to the developer together
with interest at 12% per annum. Compensation of Rs 20 lakhs was
also claimed.
The SCDRC allowed the complaint by directing the
appellant to refund the moneys paid by the respondent together
with interest at 12% per annum and compensation of Rs 5 lakhs.
The NCDRC has modified this order by reducing the compensation
from Rs 5 lakhs to Rs 2 lakhs.
Mr. Ravinder Narain, learned counsel appearing on behalf
of the appellant submits that the primary relief which was
sought in the consumer complaint was for delivery of
possession. According to the appellant, the completion
certificate was received on 29 March 2016, which was intimated
to the respondent on 11 April 2016. Moreover, before the
SCDRC, in its written submissions, the appellant had offered
possession of the Row House to the respondent. It has also
been stated that in a complaint which was filed by an
association representing the allottees of 161 Row houses, a
settlement was arrived on 11 September 2018 before the NCDRC
specifying the date on which possession would be handed
over together with interest at 6% per annum instead of 4% as
mentioned in the Buyers’ Agreement. It was urged that the
developer having made a substantial investment in terms of the
agreement, a direction for refund is not warranted. It has
also been urged that the SCDRC in the course of its decision
erroneously observed that the developer was unable to fulfill
3
its obligation to complete the construction within the agreed
period and it was not certain when the Row house would be
handed over. It was urged that this observation by the SCDRC is
contrary to the record since before it, a specific offer of
possession was made.
It has been urged on behalf of the respondent by
Mr. Supriya Bose, learned senior counsel that a consumer
complaint was filed in the year 2011. At that stage, the
appellant was bonafide ready and willing to accept possession.
However, nearly seven years have elapsed after the extended
date for the delivery of possession which expired on 30 June
2009. In spite of this, no offer of possession was
forthcoming. Learned senior counsel submitted that the letter
dated 22 March 2016 of the developer was conditional and
despite the subsequent letter dated 11 April 2016, no formal
offer of possession was ever made by the appellant. Moreover,
it was urged that the interest awarded by the NCDRC at the rate
of 12% is just having regard to the economic loss and hardship
suffered by the respondent.
While considering the rival submissions, we must at the
outset advert to the following clause which was contained in
the Buyer’s Agreement:
“Unless prevented by circumstances beyond the
control of the company and subject to Force Majeure, KWIC shall ensure to complete the said
unit in all respect within 31st December 2008 only
for the Cluster D. Further there will be a grace
period of 6 months (up to 30th June, 2009) from
the date of completion. In case the possession
is not transferred after expiry of the said grace
period, KWIC will be liable to pay prevailing
4
saving Bank interest of the State Bank of India
for each month of delay on the money given by the
allottee as compensation but no compensation will
be paid on account of force majeure reasons.”
It is the above clause which is pressed in aid by the
developer. Under the aforesaid clause, any delay beyond 30
June 2009 would result in the developer being required to pay
interest at the prevailing savings bank interest of the State
Bank of India. Interestingly, where the buyer is in default,
the agreement stipulates that interest at the rate of 18 per
cent from the date of default until the date of payment would
be charged for a period of two months, failing which the
allotment would be cancelled by deducting 5% of the entire
value of the property. The agreement was evidently one sided.
For a default on the part of the buyer, interest at the rate of
18% was liable to be charged. However, a default on the part
of the developer in handing over possession would make him
liable to pay interest only at the savings bank rate prescribed
by the SBI. There is merit in the submission which has been
urged by the buyer that the agreement was one sided. The clause
which has been extracted in the earlier part of this order will
not preclude the right and remedy available to the buyer to
claim reasonable interest or, as the case may be,
compensation.
The essential aspect of the case which is required to be
analysed is whether the buyer was entitled to seek a refund or
was estopped from doing so, having claimed compensation as the
primary relief in the consumer complaint. The Buyer’s
5
Agreement is dated 2 July 2007. In terms of the agreement, the
date for handing over possession was 31 December 2008, with a
grace period of six months. Even in 2011, when the buyer filed
a consumer complaint, he was ready and willing to accept
possession. It would be manifestly unreasonable to construe
the contract between the parties as requiring the buyer to wait
indefinitely for possession. By 2016, nearly seven years had
elapsed from the date of the agreement. Even according to the
developer, the completion certificate was received on 29 March
2016. This was nearly seven years after the extended date for
the handing over of possession prescribed by the agreement. A
buyer can be expected to wait for possession for a reasonable
period. A period of seven years is beyond what is reasonable.
Hence, it would have been manifestly unfair to non-suit the
buyer merely on the basis of the first prayer in the reliefs
sought before the SCDRC. There was in any event a prayer for
refund.
In the circumstances, we are of the view that the orders
passed by the SCDRC and by the NCDRC for refund of moneys were
justified.
Having regard to all the facts and circumstances of the
case, we modify the order of the NCDRC by directing that the
appellant shall pay interest at the rate of 9% per annum to the
respondent instead and in place of 12% as directed by the
NCDRC. Save and except for the above modification, we affirm
the directions of the NCDRC. 
6
The amount outstanding in terms of the directions of
this Court shall be released out of the moneys which have been
deposited by the appellant. The balance, if any, that remains
shall be refunded to the appellant.
The appeal is, accordingly, disposed of. There shall be no
order as to costs.
Pending application(s), if any, shall stand disposed of.
.............................J.
 (DR. DHANANJAYA Y. CHANDRACHUD)
.............................J.
 (HEMANT GUPTA)
 NEW DELHI
 MARCH 25, 2019
7
ITEM NO.39 COURT NO.8 SECTION XVII
 S U P R E M E C O U R T O F I N D I A
 RECORD OF PROCEEDINGS
Petition(s) for Special Leave to Appeal (C) No(s). 1795/2017
(Arising out of impugned final judgment and order dated 21-11-2016
in FA No. 958/2016 passed by the National Consumers Disputes Redressal Commission, New Delhi)
KOLKATA WEST INTERNATIONAL CITY PVT LTD Petitioner(s)
 VERSUS
DEVASIS RUDRA Respondent(s)
Date : 25-03-2019 This petition was called on for hearing today.
CORAM :
 HON'BLE DR. JUSTICE D.Y. CHANDRACHUD
 HON'BLE MR. JUSTICE HEMANT GUPTA
For Petitioner(s)
Mr. Ravinder Narain, Adv.
Mr. Siddharth Banthia, Adv.
Mr. Rajat Gava, Adv.
 Mr. Rajan Narain, AOR
For Respondent(s)
Mr. Supriya Bose, Sr. Adv.
Mr. Debajyoti Deb, Adv.
 Mr. Subhasish Bhowmick, AOR
Ms. Goldy Goyel, Adv.
 UPON hearing the counsel the Court made the following
 O R D E R
Leave granted.
The appeal is disposed of in terms of the signed order.
Pending application(s), if any, shall stand disposed of.
(MANISH SETHI) (SAROJ KUMARI GAUR)
COURT MASTER (SH) BRANCH OFFICER
(Signed reportable judgment is placed on the file)

Non examination of expert - fatal to claim insurance claim and failure to prove excess rain fall and water logging on road = where damage had been caused by any cause other than what was specifically excluded = among the exclusions provided in the insurance policy was normal wear and tear and gradual deterioration due to atmospheric conditions.= We have adverted to the report of the Surveyor, which found that there was only surface damage and no evidence of the road having been washed out as a result of excessive monsoon rain or inundation. That apart, as we have noted from the findings of the NCDRC, the dates on which the alleged damage is stated to have occurred had not witnessed excessive rainfall and the rain was within normal parameters. The failure of the appellant to examine any expert in regard to the cause of the damage is a significant omission which has been correctly relied upon by the NCDRC. The insurance policy specifically excluded normal wear and tear. In order to establish that this was not a case involving normal wear and tear, the appellant sought to rely upon what it described as abnormal rainfall and water logging. The evidence on the record did not sustain the basis of such a claim.

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.7315 OF 2016
MAHAVIR ROAD AND INFRASTRUCTURE PVT LTD. APPELLANT(s)
 VERSUS
IFFCO TOKIO GENERAL INSURANCE CO LTD RESPONDENT(s)
J U D G M E N T
DR DHANANJAYA Y CHANDRACHUD, J
Delay condoned.
Admit.
This appeal arises from a judgment and order dated 23
February 2016 of the National Consumer Disputes Redressal
Commission1. The NCDRC rejected the complaint of the
appellant alleging a deficiency of service in the
rejection of a claim under an insurance policy.
The appellant was undertaking the resurfacing,
metalling and asphalting of roads in Nashik. An
insurance policy was obtained by the appellant. The
insurance cover encompassed ‘material damage’. Section 1
of the insurance policy was in the following terms:
“SECTION-1 MATERIAL DAMAGE
The Company hereby agrees with the insured
(subject to the exclusions and conditions
contained herein or endorsed hereon) that if, at
any time during the period of insurance stated in
the said Schedule, or during any further period
of extension thereof the property (except packing
1 “NCDRC”
2
materials of any kind) or any part thereof
described in the said Schedule be lost, damaged
or destroyed by any cause, other than those
specifically excluded hereunder, in a manner
necessitating replacement or repair the Company
will pay or make good all such loss or damage
upto an amount not exceeding in respect of each
of the items specified in the Schedule the sum
set opposite thereto and not exceeding in the
whole the total sum insured hereby.
The Company will also reimburse the insured for
the cost of clearance and removal of debris
following upon any event giving rise to an
admissible claim under this Policy but not
exceeding in all the sum (if any) set opposite
thereto in the Schedule.”
However, the exclusions to Section 1, inter alia,
were to the following effect:
“EXCLUSIONS TO SECTION – 1
The Company shall not, however, be liable for:
***
c) normal wear and tear, gradual deterioration
due to atmospheric conditions or lack of use or
obsolescence or otherwise, rust scratching of
painted or polished surfaces or breakage of
glass;”
There were specific conditions applicable to Section
1. Among the ‘major perils/Act of God perils’ described
in Memo 8 was “Flood/Inundation”.
The appellant submitted a claim on the ground that
between 25 June 2007 and 5 July 2007, it had suffered a
loss and damage to the roads which had been worked upon
due to “abnormal rainfall and water logging”. By its
letter dated 14 September 2007, the appellant stated that
due to heavy rains on 29 June 2007, the roads were
inundated and the top layer had been washed out.
3
By a communication dated 28 March 2008, the insurer
rejected the claim, inter alia, on the ground that the
damage had been caused by defective workmanship and
materials and due to the failure to provide an
alternative route for traffic. Subsequently, after
further correspondence, the insurer informed the
appellant on 13 May 2008 that the loss or damage to the
roads had been caused due to (i) monsoon rains; and (ii)
damage/peeling off of the top surface of the asphalt due
to the plying of vehicular traffic on wet roads,
resulting in wear and tear. The exclusion in the
insurance policy of damage due to normal wear and tear or
due to gradual deterioration as a result of atmospheric
conditions was relied upon.
The report of the Surveyor, B.P. Shah & Associates,
dated 21 March 2008, was in the following terms, insofar
as is material:
“PROBABLE CAUSE:
According to the insured loss was caused due to
heavy abnormal rains etc. Copy of their letter
dated 28th July 2007 is enclosed herewith
(Encl.4).
What was observed was surface damages & neither
any rain cuts nor erosion of base soil of the
roads by flowing floodwater were seen. Top
surface of the asphalt had peeled off/got damaged
due to movement of traffic over a period of time
on wet roads and normal wear & tear which also
crerated few pot holes. Policy excludes normal
wear & tear, gradual deterioration due to
atmospheric conditions (Exclusion C under Section
1) & also damage due to movement of traffic,
which is by no means fortuitous.”
4
The NCDRC rejected the consumer complaint on several
grounds. It held that:
(i) The appellant had initially stated in its claim
form that the loss had occurred between 25 June 2007 and
5 July 2007. In its letter dated 14 September 2007, the
appellant claimed that due to heavy rains on 29 June
2007, the roads were inundated and the top layers were
washed out. The report of the Surveyor indicated that
the stand taken before it was that the damage had
occurred on 2/3 July 2007. Thus, the appellant had not
been consistent in the date of the allaged damage;
(ii) In breach of the obligation contained in the
insurance policy which required that the damage should be
immediately notified, intimation was furnished only on 9
July 2007 and there was no explanation for the delay in
reporting the damage to the insurer;
(iii) According to the Surveyor, there was no evidence
of any damage on account of flood water and only surface
damage was found. The data of the Meteorological
Department indicated minimal rains on the alleged dates
of damage;
(iv) No expert had been examined by the appellant in
support of its claim that rainfall, to the extent that
had occurred, would have resulted in severe damage to the
road.
Mr. Anirudha Joshi, learned counsel appearing on
behalf of the appellant, submits that the insurance
5
policy covered damage due to ‘any cause whatsoever’.
Hence, it was urged that whether or not the damage had
been caused by excessive rainfall was really not material
at all since the appellant was entitled to be indemnified
for the damage which was sustained to the roads. In this
regard, Section 1 of the insurance policy was relied
upon, which has been extracted earlier.
On the alleged failure of the appellant to intimate
the insurer of the cause of the loss or damage, learned
counsel submitted that Clause 5 of the General Conditions
stipulated that the insurer shall not be liable, in any
case, when no notice has been received within fourteen
days of the occurrence. In the present case, it was
submitted that the notice on 9 July 2007 was within a
period of fourteen days. On these grounds, it has been
submitted that the reasons which have weighed with the
NCDRC in dismissing the complaint are unsustainable.
On the other hand, it was urged on behalf of the
insurer by Mr. Abhishek Mishra, learned counsel that the
specific ground on which the claim was filed under the
terms of the insurance policy was that there was abnormal
rainfall and water logging. This was evidently in
pursuance of the provisions of the insurance policy under
which flood/inundation constituted the major perils which
were within the purview of the insurance cover. Learned
counsel has adverted to the claim form, the letter dated
14 September 2007 and the Surveyor’s report dated 21
6
March 2008. The basis of the claim was found to be
false.
While analyzing the rival submissions, it must, at
the outset, be noted that the basis of the claim which
was submitted by the appellant was that there was
abnormal rainfall and water logging between 25 June 2007
and 5 July 2007. Subsequently, in its letter dated 14
September 2007, the appellant claimed that it was due to
heavy rains on 29 June 2007 that the roads were inundated
and the top layer had been washed out.
While dealing with this submission, the NCDRC has
made the following findings:
“As per the data quoted from the Meteorological
Department, the rainfall was 15.2 mm on
25.6.2007, 9.2 mm on 26.6.2007, 0 mm on
27.6.2007, 5mm on 28.06.2007, 0 mm on 29.6.2007,
0 mm on 30.6.2007, 10.6 mm on 01.7.2007, 49.2 mm
on 02.7.2007 and 116.6 mm on 30.7.2007.”
Upon analysing the data which was placed before it,
the NCDRC observed:
“In fact, there was no rain at all on 29.6.2007
or even on 30.6.2007. In fact, the rainfall from
25.6.2007 to 01.7.2007 was nil or nominal. The
rainfall on 02.7.2007 was 49.2 mm, whereas the
rainfall on 03.7.2007 was 111.6 mm.”
But, it has been urged on behalf of the appellant
that, whether or not, there was abnormal rain and water
logging is irrelevant because the appellant was entitled
to claim in terms of Section 1 of the insurance policy
where damage had been caused by any cause other than what
was specifically excluded. In this background, it is
7
necessary to note that among the exclusions provided in
the insurance policy was normal wear and tear and gradual
deterioration due to atmospheric conditions. The case of
the appellant was that it was due to excess rainfall that
the roads were damaged. By necessary implication, the
submission was that this would not constitute normal wear
and tear in terms of the exclusions contained in the
policy.
We have adverted to the report of the Surveyor, which
found that there was only surface damage and no evidence
of the road having been washed out as a result of
excessive monsoon rain or inundation.
That apart, as we have noted from the findings of the
NCDRC, the dates on which the alleged damage is stated to
have occurred had not witnessed excessive rainfall and
the rain was within normal parameters. The failure of
the appellant to examine any expert in regard to the
cause of the damage is a significant omission which has
been correctly relied upon by the NCDRC. The insurance
policy specifically excluded normal wear and tear. In
order to establish that this was not a case involving
normal wear and tear, the appellant sought to rely upon
what it described as abnormal rainfall and water logging.
The evidence on the record did not sustain the basis of
such a claim.
In this view of the matter and for the reasons we
have indicated, we are unable to come to the conclusion
8
that the order pased by the NCDRC suffered from any
error. We accordingly do not find any reason to
entertain the appeal. The appeal is dismissed.
Pending application, if any, stands disposed of.
.............................J.
 (DR DHANANJAYA Y CHANDRACHUD)
.............................J.
 (HEMANT GUPTA)
NEW DELHI
MARCH 26, 2019
9
ITEM NO.38 COURT NO.8 SECTION XVII
 S U P R E M E C O U R T O F I N D I A
 RECORD OF PROCEEDINGS
Civil Appeal No(s).7315/2016
MAHAVIR ROAD AND INFRASTRUCTURE PVT LTD. Appellant(s)
 VERSUS
IFFCO TOKIO GENERAL INSURANCE CO LTD Respondent(s)
(WITH APPLN.(S) FOR CONDONATION OF DELAY IN FILING APPEAL)
Date : 25-03-2019 This appeal was called on for hearing today.
CORAM :
 HON'BLE DR. JUSTICE D.Y. CHANDRACHUD
 HON'BLE MR. JUSTICE HEMANT GUPTA
For Appellant(s) Mr. Anirudha Joshi, Adv.
Mr. Abhishek Singh, Adv.
Mr. Onkar Singh, Adv.
Mr. Saurabh Mishra, AOR

For Respondent(s) Mr. Abhishek Mishra, Adv.
Mr. Rajat Khattry, Adv.
 Mr. Vivek Kishore, AOR

UPON hearing the counsel the Court made the following
 O R D E R
Delay condoned.
Admit.
The appeal is dismissed in terms of the signed
reportable judgment.
Pending application, if any, stands disposed of.
 (SANJAY KUMAR-I) (SAROJ KUMARI GAUR)
 AR-CUM-PS COURT MASTER
(Signed reportable judgment is placed on the file)

five golden principles, if we may say so, constitute the panchsheel of the proof of a case based on circumstantial evidence = (1) the circumstances from which the conclusion of guilt is to be drawn should be fully established.(2) the facts so established should be consistent only with the hypothesis of the guilt of the accused, that is to say, they should not be explainable on any other hypothesis except that the accused is guilty, (3) the circumstances should be of a conclusive nature and tendency, (4) they should exclude every possible hypothesis except the one to be proved, and (5) there must be a chain of evidence so complete as not to leave any reasonable ground for the conclusion consistent with the innocence of the accused and must show that in all human probability the act must have been done by the accused.”

CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 1
REPORTABLE
 IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.591 OF 2019
(Arising out of Special Leave Petition (Criminal) No.856 of 2018)
PAVAN VASUDEO SHARMA …Appellant
VERSUS
STATE OF MAHARASHTRA THROUGH SECRETARY …Respondent
J U D G M E N T
Uday Umesh Lalit, J.
1. Leave granted.
2. This appeal at the instance of original Accused No.1, challenges the
correctness of the judgment and order dated 24.03.2015 passed by the High
Court of Judicature at Bombay dismissing his Criminal Appeal No.700 of
2013.
3. According to the prosecution, Police Naik Nagare (later examined as
PW11 in the trial) was robbed of his pistol (service weapon) and walkie talkie
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 2
set by three persons on 20.12.2005 at about 9.00 pm. Accordingly an FIR was
registered on 20.12.2005 in respect of said incident, which FIR in the present
proceedings was placed on record vide Exhibit 106. The FIR did not name
any person but gave description of all the three persons. The said case was
separately tried.
4. On 04.01.2006 PW1-PSI Dabir received a phone call that one injured
person was lying near a motorcycle on Mumbai-Pune highway. Said PW1
went to the spot and took the injured to the hospital where he was declared
dead. On the basis of motorcycle driving licence found in the trousers of the
deceased, he was identified as one Bhima Waghmare. The family members
were, thereafter, informed and FIR Exhibit 13 was lodged pursuant to which
an offence was registered vide C.R.No.5 of 2006. The investigation
commenced and body was sent for post-mortem. PW3 Dr. Joshi conducted
the post-mortem and found the following external injuries:-
“(1) Fire arm injury. Right side inframammary
region, 13 cm below and medial to left
mammary gland.
 (2) Burn injury due to firm arm on left thigh. Two in
number. 9 cm. below iliac left side admeasuring
2 ½ cm. x 1 cm. Superficial to deep. Dark black
in colour with red center.
 (3) Abrasion over 9 cm. below iliac region left side
8 cm below and 5 cm posterior to anterior
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 3
superior iliac spine, admeasuring 2 ½ cm x
superficial to deep.
 (4) Abrasions on body as under:
(A) Arm medial third anteriorly;
(B) Elbow posteriorly and
(C) Wrist anteriorly:
(D) (a) Thigh middle third.
 (b)Knee joint.”
Said PW3 Dr. Joshi found the following corresponding internal
injuries:-
“Penetrating wound to abdominal wall, peritoneum
superior side of left lobe of liver, shattering part of it.
Coming out at inferior side, entering into pancreas,
shattering out the pancreas, penetrating at two sites at
mesentery of small intestine. Two cm. in diameter
each, going posterior medial to left kidney with large
retro peritoneal and peritoneal region. Fitting lumber
spine no. 4 and 5 body with indentation and fracture at
left side of body of L 4 and L 5. Changing the
direction hitting illiacrest at left Sacra iliac joint.
Changing direction, getting embedded into para spinal
muscles and fat left side, directed laterally and
superiorly. Bullet recovered from above mentioned
side. Yellowish metal concavity at its base.”
5. It is the case of the prosecution that when Bhima Waghmare was shot,
the firm arm used in the transaction was the same service weapon which was
robbed from PW11 Police Naik Nagare. Soon after the murder, two cell
phones belonging to Bhima Waghmare were also allegedly robbed, one of
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 4
them being a cell phone of Nokia Company with cell number 9850520922.
This mobile was later used in the case of kidnapping of a boy named Akash
Lokhande, who was kidnapped on 13.01.2006 and the calls for ransom were
stated to have been made from the very same cell phone to PW 12 Sanjay
Lokhande, father of the boy. An FIR was registered in relation to said
kidnapping on 13.01.2006 and said case was also tried separately.
6. During the course of investigation of the kidnapping case, information
was received by the police that said Akash Lokhande was confined in a
building in Vimannagar, Pune. Accordingly, a raid was arranged and when
the police entered said building, they found Pavan Vasudeo Sharma
(Accused No.1), Pankaj Ramgopal Jagaria (Accused No.2), Vasudeo Sharma
and Rajendra Gaud to be present there. Those persons were apprehended.
During his personal search, a 9 mm pistol (service revolver) and two
live cartridges were recovered from Accused No.1. Two cell phones were
also found from him. In the search of Accused No.2, a chopper was found.
All those four persons came be to apprehended in kidnapping case. The
recovered pistol was sent for forensic analysis. The forensic analyst found
that the bullet which was recovered from the stomach of deceased Bhima
Waghmare, was fired from the same pistol. The live cartridge that was
recovered from Accused No.1 was test fired by the forensic analyst from the
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 5
same pistol and the features of the firing pin impression on the cartridge
tallied with those found from the bullet recovered from the body of deceased
Bhima Waghmare.
All the four apprehended persons were put up for identification by
PW11 Police Naik Nagare and according to the witness he could identify
Accused Nos.1 and 2. However, no documentation as regards the Test
Identification Parade was produced on record in the present trial.
7. After completion of investigation, Accused Nos.1 and 2 were tried for
having committed the offences including the murder of said Bhima
Waghmare, punishable under Sections 302, 392 read with Section 34 of the
Indian Penal Code, Section 37(1) read with Section 135 of the Bombay
Police Act and Section 3 (25) of the Indian Arms Act.
8. PW2 Seema widow of the deceased Bhima Waghmare stated in her
deposition that her husband was having two mobile numbers and one of
them was 9850520922. She accepted that in her first reporting she had
expressed suspicion against some other persons including professional rivals
of her husband. PW5 Sachin Mahadev Shinde, Nodal Officer of Idea
Cellular Company stated that mobile phone number 9850520922 was
subscribed by one Sanjay S. Roy having his address as Sai Prasad Foods
Ltd., Telco Road, First Floor, near Raka Gas Company, Chinchwad Station,
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 6
Pune-411019. He also produced the record of calls details vide Exhibit 55
showing relevant pages of call details with regard to period January 2006
and February 2006 about user of the mobile. PW6 Senior Police Inspector
Pandurang Udhavrao Kohimkar was the Investigating Officer in the matter.
He did not depose about any Test Identification Parade nor did he produce
any record regarding identification of Accused Nos. 1 and 2 by PW11 Police
Naik Nagare. PW12 Sanjay Lokhande, father of Akash Lokhande testified
that demands for ransom were made from him and the communication was
received from mobile number 9850520922. During his testimony he also
mentioned that the person who was making the demand had casually
mentioned that they had killed a person at Karjat.
9. It was the case of the prosecution that the pistol seized from the
Apellant-Accused No.1 was a service weapon which was entrusted to PW11
Police Naik Nagare, which weapon was snatched from him on 20.12.2005.
It was the same weapon which was found to be used in the commission of
offence of murder of Bhima Waghmare. There was no direct evidence in the
form of any eyewitness account which was available on record and the
prosecution mainly relied upon certain circumstances in support of its case.
The circumstantial evidence in the matter was based mainly on two
features:-
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 7
a) Recovery of mobile phone which was allegedly used for making
demands of ransom; and
b) Seizure of 9 mm pistol as aforesaid.
10. Apart from these two circumstances, reliance was also placed on the
alleged extra judicial confession made by those demanding ransom in their
telephonic conversation with PW12-Sanjay Lokhande. Considering these
circumstances to be clinching and pointing towards nothing but the guilt of
the accused, the Additional Sessions Judge, Pune, vide his judgment dated
11.01.2011 convicted said Accused Nos. 1 and 2 for the offences punishable
under Sections 302, 392 read with Section 34 IPC, Section 37(1) read with
Section 135 of the Bombay Police Act and Section 3 (25) of the Indian Arms
Act and sentenced them to suffer life imprisonment under the first count,
rigorous imprisonment for two years under the second count, rigorous
imprisonment for 15 days under the third count and rigorous imprisonment
for six months under the fourth count.
11. Both the convicted accused challenged their conviction and sentence
by preferring two appeals being Criminal Appeal No.700 of 2013 and
Criminal Appeal No.1056 of 2013. As regards Accused No.1, the High
Court found that the prosecution had established its case and there was
sufficient evidence to prove that he was involved in the crime relating to the
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 8
murder of Bhima Waghmare. The High Court, however, found that there
was no material to connect Accused No.2 with the crime and, therefore,
acquitted him of the charges levelled against him under Sections 302, 392 of
IPC and under Section 3(25) of the Indian Arms Act but maintained his
conviction and sentence insofar as offence under Section 37(1) read with
Section 135 of the Bombay Police Act was concerned.
12. It is a matter of record that the acquittal of Accused No.2 has not been
challenged by the State and has attained finality.
13. The facts narrated above bring out the following features:-
a) Going by FIR at Exhibit 106, three persons were responsible
for robbing PW11 Police Naik Nagare of his service
weapon. Though the description of all three persons was
given in FIR Exhibit 106, no Test Identification Parade was
undertaken when four suspects were apprehended during
investigation of the kidnapping case. No material in that
behalf is produced on record. Nothing is clear on record as
to who was the third person.
b) According to PW11 Police Naik Nagare he had lost
consciousness for a while after he was assaulted by those
three persons; that after he regained consciousness, he dialed
100 from his mobile and intimated about the loss of his
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 9
service weapon and walkie talkie. It is somewhat
incongruent that the persons who robbed him of his service
weapon and walkie talkie would leave his mobile intact.
c) In terms of version of PW2 Seema, mobile number
9850520922 was subscribed by her husband Bhima
Waghmare. On the other hand, the evidence led by the
prosecution itself in the form of testimony of PW5 Sachin
Mahadev Shinde shows that mobile number 9850520922
was subscribed by one Sanjay S Roy. Again, the
prosecution has failed to establish the link, if any, between
said Sanjay S Roy and Bhima Waghmare and whether said
Sanjay S Roy had ever handed over his mobile to Bhima
Waghmare.
d) PW2 Seema in her original version had expressed suspicion
about certain professional rivals of her husband.
e) The assertion that one of the persons making ransom calls
had disclosed that they had killed a person at Karjat did not
come in the examination-in-chief of PW12 Sanjay Lokhande
but appeared in his cross-examination. It was thus not the
specific case of the prosecution that any extra judicial
confession was made to PW12 Sanjay Lokhande.
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 10
f) The matter has one more dimension. While ordering
acquittal of Accused No.2, insofar as principal charges are
concerned, his conviction for offence under Section 37(1)
read with Section 135 of the Bombay Police Act was
maintained by the High Court. We, thus, have to proceed on
the footing that Accused No. 2 was also guilty of snatching
the service weapon of PW11 Police Naik Nagare but not of
murder.
g) There was a gap of about 15 days between the snatching of
the service weapon and murder.
14. With the acquittal of Accused No.2 of the principal charge under
Section 302, we are now called upon to see whether the material on record
sufficiently establishes that it was Accused No.1 alone who was guilty of the
offence punishable under Section 302 IPC.
15. Two circumstances which are principally relied upon by the
prosecution are already mentioned hereinabove. The first circumstance
regarding mobile phone is not proved at all. The mobile number was not
subscribed by deceased Bhima Waghmare but was subscribed by Sanjay S.
Roy. No link between these two persons has been established nor any bill in
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 11
the name of said Bhima Waghmare was produced on record. Since the
evidence that the mobile number was subscribed by said Sanjay S. Roy was
led by the prosecution itself, it cannot be assumed that said mobile number
was, in fact, subscribed by Bhima Waghmare. The connection which would
link the accused with the murder of Bhima Waghmare, on this front is
completely missing. As regards the second circumstance, it is true that the
bullet recovered from the body of the deceased matched with the service
weapon which was allocated to PW11 Police Naik Nagare but the theory that
the weapon was snatched by the accused is not sufficiently established. No
Test Identification Parade was held and if held, no material in that behalf has
been produced on record. The second circumstance, therefore, is not
sufficiently established as against the accused.
16. The law on the point of appreciation of cases based on circumstantial
evidence is very clear. It was laid down by this Court in Sharad Birdhichand
Sarda vs. State of Maharashtra1
as under:-
“153. A close analysis of this decision would show that
the following conditions must be fulfilled before a case
against an accused can be said to be fully established:
(1) the circumstances from which the
conclusion of guilt is to be drawn should be
fully established.
1 (1984) 4 SCC 116
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 12
It may be noted here that this Court indicated that the
circumstances concerned “must or should” and not “may
be” established. There is not only a grammatical but a
legal distinction between “may be proved” and “must be
or should be proved” as was held by this Court in
Shivaji Sahabrao Bobade v. State of Maharashtra2
where the observations were made: [SCC para 19, p.
807: SCC (Cri) p. 1047]
“Certainly, it is a primary principle that the
accused must be and not merely may be guilty
before a court can convict and the mental
distance between ‘may be’ and ‘must be’ is
long and divides vague conjectures from sure
conclusions.”
(2) the facts so established should be
consistent only with the hypothesis of the guilt
of the accused, that is to say, they should not
be explainable on any other hypothesis except
that the accused is guilty,
(3) the circumstances should be of a
conclusive nature and tendency,
(4) they should exclude every possible
hypothesis except the one to be proved, and
(5) there must be a chain of evidence so
complete as not to leave any reasonable
ground for the conclusion consistent with the
innocence of the accused and must show that
in all human probability the act must have
been done by the accused.”
154. These five golden principles, if we may say so,
constitute the panchsheel of the proof of a case based on
circumstantial evidence.”
2 (1973) 2 SCC 793; 1973 SCC (Cri) 1033; 1973 Cri LJ 1783
CRIMINAL APPEAL NO. 519 OF 2019 (@ SLP(Crl)No.856 OF 2018)
Pavan Vasudeo Sharma vs. State of Maharashtra through Secretary
 13
17. Applying the principles as culled out in the aforesaid decision, which
have stood the test of time, in our view, the matter is not free from doubt. The
circumstances relied upon must rule out every single hypothesis except the
guilt of the person accused of an offence. There are too many missing links in
the present matter and in our considered view, the material on record does not
exclude every single hypothesis except the guilt of the man.
18. We, therefore, give benefit of doubt to the Appellant. This appeal is,
therefore, allowed and the Appellant is acquitted of the charges levelled
against him. He be set at liberty forthwith unless his presence is required in
connection with any other offence.
..………….……………J.
 (Uday Umesh Lalit)
..………….……………J.
 (Indu Malhotra)
New Delhi,
March 25, 2019.