THE CONSTITUTION BENCH OF SUPREME COURT HOLDS THAT A BLANKET ORDER / DIRECTION CANNOT BE PASSED TO GIVE A TIME-BOUND SCHEDULE FOR DISPOSAL OF CASES PENDING BEFORE LOWER COURTS

That a five-Judge Constitution Bench of the Hon’ble Supreme comprising of the Chief Justice of India (CJI) Dr Dhananjaya Y. Chandrachud, Justice Abhay S. Oka, Justice J. B. Pardiwala, Justice Manoj Misra and Justice Pankaj Mithal, in the matter of High Court Bar Association, Allahabad vs State of U.P. & Ors. Criminal Appeal No. 3589 of 2023 along with other connected matters, passed a Judgment dated 29-02-2024 and made observations about the scope of exercise of jurisdiction of Apex Court under Article 142 of the Constitution (Enforcement of decrees and orders of Supreme Court and orders as to discovery, etc) to order vacation of stay orders / interim orders passed by High Courts on the expiry of a certain period, to avoid prolonging of civil or criminal proceedings or to give a time-bound schedule for the disposal of cases pending before lower Courts and High Courts.

Facts

i) That in Asian Resurfacing of Road Agency Private Limited & Anr. v. Central Bureau of Investigation, (2018) 16 SCC 299, Criminal Appeal No. 3589 of 2023 and other connected matters, a three-Judge Bench of the Apex Court dealt with the question of law i.e. whether the Trial Court can proceed with the trial, when the High Court of Allahabad has passed an order of stay, which has automatically expired after six months of passing such stay order.

ii) The three-Judge Bench of the Supreme Court, vide Order dated 01-12-2023, observed as follows and held that if the matter relating to Prevention of Corruption Act 1988 or any civil or criminal case, remains pending for a longer period of time, the stay order will stand vacated on expiry of six months, unless extension is granted by a speaking order. This is because a stay of an indefinite nature results in prolonging civil or criminal proceedings:

“if a stay is granted, it should not normally be unconditional or of an indefinite duration and appropriate conditions may be imposed so that the party in whose favour the stay is granted is accountable if the Court finally finds no merit in the matter”

iii) However, the three-Judge Bench of the Apex Court referred the matter for reconsideration by a larger Bench of five Judges.

Supreme Court Constitution Bench Observations

That the 5-Judge Constitution Bench of the Supreme Court, vide Order dated 29-01-2024, made the following observations regarding scope of jurisdiction under Article 142 of the Constitution to order for automatic vacation of a stay order passed by a High Court:

I) Object of passing an interim order of stay:

1) That an interim order of stay is generally passed in matters, where the High Court is entertaining a challenge to an order passed in a case pending before the lower Court.

2) In the event that the pending case is not stayed, the trial Court may decide the pending case, rendering the remedy before the High Court ineffective.

3) Further, the object of passing an interim order is that such an order of interim relief would be an aid for the final relief sought in the case.

4) That while passing an interim order of stay, three factors are considered i.e. prima facie case, irreparable loss, and balance of convenience:

“The High Court can grant relief of the stay of hearing of the main proceedings on being satisfied that a prima facie case is made out and that the failure to stay the proceedings before the concerned Court in all probability may render the remedy adopted infructuous.”

II) High Court’s power to vacate or modify the interim stay order

1) That in case of an interim stay order, the High Court passes such order after giving an opportunity of being heard on the prayer for interim relief to the parties to the proceedings.

2) However, in case, the High Court grants a stay of the proceedings while issuing notice without giving an opportunity of being heard to the contesting parties, it is not an interim order, but it is an ad-interim order of stay.

3) Further, the High Court may vacate the interim stay order on various grounds inter alia (i) if a litigant, after getting an order of stay, deliberately prolongs the proceedings, by seeking adjournment or by remaining absent or on any other unwarranted grounds, or (ii) if the party in whose favor the stay order was granted, had suppressed material facts before the Court, or (iii) owing to a long passage of time, there have been material changes in circumstances, etc.

III) Automatic vacation of stay order due to lapse of time

1) That the High Court or the Supreme Court may pass a speaking order to vacate an interim order, after giving opportunity to the contesting parties as per the principles of natural justice.

“Application of mind is an essential part of any decision-making process. Therefore, without application of mind, an order of interim stay cannot be vacated only on the ground of lapse of time when the litigant is not responsible for the delay.”

2) Thus, an interim order that is passed after hearing all the contesting parties, cannot be vacated or rendered illegal only due to the long passage of time. As it would be deemed to be arbitrary and contrary to the concept of fairness.

“If an interim order is automatically vacated without any fault on the part of the litigant only because the High Court cannot hear the main case, the maxim “actus curiae neminem gravabit” will apply. No litigant should be allowed to suffer due to the fault of the Court. If that happens, it is the bounden duty of the Court to rectify its mistake”.

3) Otherwise, if automatic vacation of stay orders after lapse of certain period is allowed, firstly, it would defeat the rights of the litigant to avail statutory remedies such as revisions, appeals, writ petition, etc. Secondly, it would give an unfair advantage to the respondent in the case before the High Court.

IV) Scope of exercise of power of Apex Court under Article 142 of Constitution

1) While exercising the jurisdiction under Article 142 of the Constitution of India, the Supreme Court may issue procedural directions to the lower Courts and High Courts for streamlining procedural aspects to ensure speedy and timely disposal of cases, keeping in mind the substantive rights of the litigants.

2) However, the High Court being constitutionally independent of the Supreme Court and not being judicially subordinate to the Apex Court, the Supreme Court, under Article 142 of the Constitution, cannot interfere with the jurisdiction of the High Court in respect of granting interim relief, by limiting its jurisdiction to pass interim orders valid only for six months at a time.

“Putting such constraints on the power of the High Court will also amount to making a dent on the jurisdiction of the High Courts under Article 226 of the Constitution, which is an essential feature that forms part of the basic structure of the Constitution.”

3) That in an ideal situation, the civil/criminal cases in which stay of proceedings is granted, ought to be disposed of expeditiously by the High Courts. However, the High Courts are overburdened with writ petitions under Article 226 and 227 of the Constitution, petitions under Section 482 of the Code of Criminal Procedure 1973 (CrPC) (Saving of inherent powers of High Court), regular appeals filed in civil and criminal cases, bail petitions, petitions filed in the exercise of revisional jurisdiction under the Code of Civil Procedure 1908 (CPC) and CrPC, etc. Therefore, once a case is entertained by the High Court and the stay is granted, the case has a long life.

“The High Courts cannot be expected to decide, on a priority basis or a day-to-day basis, only those cases in which a stay of proceedings has been granted while ignoring several other categories of cases that may require more priority to be given.”

4) That as per the Constitution Bench, the situation in Trial Courts and District Courts is worse. There are different categories of cases which, by their very nature, are required to be given utmost priority and be disposed within the statutory time period, such as the cases of the accused in jail, the cases of senior citizens, cases involving certain serious offences against women, etc. However, the lower Courts are not in a position to implement the said provisions.

5) Thus, the Constitution Bench held that in the ordinary course, the constitutional Courts should not exercise the power to direct the disposal of a case before any District or Trial Court or High Court within a specific time span or on a priority basis.

6) Hence, the Courts have to follow the prescribed time limits as stipulated in the legislation, if any. Further, the High Courts may rationally decide before setting any priorities in disposing of cases.

“Therefore, the Judges of the High Courts should be allowed to set their priorities on a rational basis. Thus, as far as setting the outer limit is concerned, it should be best left to the concerned Courts unless there are very extraordinary circumstances.”

V) Procedure to be adopted by High Courts while granting and vacating interim stay order

1) That as observed hereinabove, once the High Court stays a trial, it takes a very long time for the High Court to decide the main case. “To avoid any prejudice to the opposite parties, while granting ex-parte ad-interim relief without hearing the affected parties, the High Courts should normally grant ad-interim relief for a limited duration.”

2) The Constitution Bench observed that after expiry of the limited period of time for which the interim order was passed, (i) the High Court must give necessary priority to the hearing of applications for vacating the stay, if the main case cannot be taken up for hearing immediately. This is because applications for vacating interim reliefs cannot be kept pending for an inordinately long time. (ii) Thereafter, the High Court must apply its judicious mind to vacate / affirm / extend / modify the ad-interim relief and pass a speaking order in that regard.

Conclusion

Thus, based on the aforesaid observations, the 5-Judge Constitution Bench of the Supreme Court held that a blanket order / direction under Article 142 of the Constitution cannot be passed (i) directing that all the interim orders of stay of proceedings passed by every High Court would automatically expire only by reason of lapse of time or (ii) to give a time-bound schedule for the disposal of cases pending before any other Courts.

However, the High Courts may pass ad-interim orders of stay for a limited period of time and thereafter, vacate / affirm / extend / modify such stay orders on a priority-basis, after giving opportunity of being heard to the contesting parties.

 

Harini Daliparthy

Senior Associate

The Indian Lawyer