After almost six years, the Supreme Court overruled its landmark judgment in the case of Asian Resurfacing of Road Agency Private Limited & Anr. V. Central Bureau of Investigation[i], passed by a three-judge Bench wherein, inter-alia, the law was laid down that where an order staying proceedings in any civil or criminal trial is passed, the same would automatically expire after a period of six months, extendable only by a speaking order. The correctness of the law laid down was questioned in the case of High Court Bar Association, Allahabad V. State of U.P. & Ors.[ii], where the three-judge Bench referred the question to a Constitution Bench on 01.12.2023.
What were the issues in the Asian Resurfacing judgment?
The Supreme Court was called upon to decide whether a High Court could consider a challenge to an order of framing of charge in a criminal trial, and whether the order of framing of charge is an interlocutory or a final order. The three-judge Bench held that an order of framing of charge was not an interlocutory order, and therefore, a High Court has jurisdiction to grant a stay of proceedings in such matter. This being the moot question of law, the Bench decided to address the issue of stay orders granted by High Courts in general, whether in civil or criminal proceedings and the effect such orders have in the administration of justice and Rule of Law given the fact that such orders delay expeditious disposal of cases.
What was held in the operative part of the Asian Resurfacing judgment?
The Bench in paras 36 and 37 of the judgment held that the long pendency of cases due to stay orders needed to be remedied, and thus held: –
‘we consider it appropriate to direct that in all pending cases where stay against proceedings of a civil or criminal trial is operating, the same will come to an end on expiry of six months from today unless in an exceptional case by a speaking order such stay is extended. In cases where stay is granted in future, the same will end on expiry of six months from the date of such order unless similar extension is granted by a speaking order. The speaking order must show that the case was of such exceptional nature that continuing the stay was more important than having the trial finalized……
the challenge to an order of charge should be entertained in a rarest of rare case only to correct a patent error of jurisdiction and not to reappreciate the matter. Even where such challenge is entertained and stay is granted, the matter must be decided on day-to-day basis so that stay does not operate for an unduly long period. Though no mandatory time-limit may be fixed, the decision may not exceed two-three months normally. If it remains pending longer, duration of stay should not exceed six months, unless extension is granted by a specific speaking order, as already indicated’
What were the issues that caused the Supreme Court to reconsider the Asian Resurfacing Judgment?
Additional Chief Judicial Magistrate, Pune was called upon to proceed with the trial of a case upon automatic expiration of the stay order passed by the Bombay High Court after six months. The Judicial Magistrate, however, refused to proceed with the trial, stating that a subordinate court could not pass any order contrary to an order passed by the High Court. The matter reached the Supreme Court which held that on automatic expiration of the stay order, the trial court could proceed with the trial and specific orders to that effect weren’t needed. This direction was sought to be applied in other cases as well which ultimately led the Supreme Court three-judge Bench to refer the Asian Resurfacing judgment to a Constitution Bench seeking reconsideration of its ratio. The reference order of the three-judge Bench thus held:-
‘The principle which has been laid down in the above decision to the effect that the stay shall automatically stand vacated (which would mean an automatic vacation of stay without application of judicial mind to whether the stay should or should not be extended further) is liable to result in a serious miscarriage of justice’.
What were the questions of law the Constitution Bench in High Court Bar Association, Allahabad, was called upon to decide?
The Constitution Bench was called upon to decide the scope of powers the Supreme Court has under Article 142 of the Constitution of India, and whether such powers would include the power to direct a blanket automatic vacation of stay order in all civil and criminal cases after the expiry of a certain period, and also if such powers could be exercised to direct the High Courts to decide pending cases, in which interim order of stay has been granted, on a day-to-day basis within a fixed period.
What is the law laid down by the Constitution Bench in the High Court Bar Association, Allahabad?
The Constitution Bench expressed doubts regarding the correctness of the law laid down in the Asian Resurfacing judgment and held thus: –
‘If a High Court concludes after hearing all the concerned parties that a case was made out for the grant of stay of proceedings of a civil or criminal case, the order of stay cannot stand automatically set aside on expiry of the period of six months only on the ground that the High Court could not hear the main case. If such an approach is adopted, it will be completely contrary to the concept of fairness….
a direction has been issued to the Trial Courts to immediately fix a date for hearing after the expiry of the period of six months without waiting for any formal order of vacating stay passed by the High Court. This gives an unfair advantage to the respondent in the case before the High Court. Moreover, it adversely affects a litigant’s right to the remedies under Articles 226 and 227 of the Constitution of India…… All interim orders of stay passed by all High Courts cannot be set at naught by a stroke of pen only on the ground of lapse of time.
The Bench further declared the law relating to the exercise of extraordinary powers of the Supreme Court under Article 142 of the Constitution of India while holding that the directions issued in the Asian Resurfacing judgment were in the exercise of powers under Article 142, thus held: –
‘The directions in the exercise of power under Article 142 cannot be issued to defeat justice. The jurisdiction under Article 142 cannot be invoked to pass blanket orders setting at naught a very large number of interim orders lawfully passed by all the High Courts, and that too, without hearing the contesting parties. The jurisdiction under Article 142 can be invoked only to deal with extraordinary situations for doing complete justice between the parties before the Court’.
The Bench then explained the Constitutional position of High Courts vis-à-vis the Supreme Court. Laying emphasis on the independence of the High Courts, the court thus held: –
‘A High Court is Constitutionally independent of the Supreme Court of India and is not subordinate to this Court………
By a blanket direction in the exercise of power under Article 142 of the Constitution of India, this Court cannot interfere with the jurisdiction conferred on the High Court 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.
Interestingly, the Constitution Bench, while holding that the Asian Resurfacing directions were issued under Article 142, went ahead and found flaw in the judgment even on the ground that the directions were issued on matters that did not even arise for consideration.
Even the directions of hearing of cases on a day-to-day basis or within a specific time did not find favour with the Constitution Bench, which, after examining and quoting the observations of landmark judgments of A.R. Antulay[iii] and P. Ramachandra Rao[iv], the Bench concluded thus: –
‘Thus, the directions of the Court that provide for automatic vacation of the order of stay and the disposal of all cases in which a stay has been granted on a day-to-day basis virtually amount to judicial legislation. The jurisdiction of this Court cannot be exercised to make such a judicial legislation. Only the legislature can provide that cases of a particular category should be decided within a specific time.
In the final paragraphs of the judgment, the Constitution Bench acknowledged the fact that once a trial is stayed, it takes a very long time for it to reach the final conclusion and gave general directions as to how the High Courts ought to deal with interim orders, the Bench held: –
‘….we cannot ignore that 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. After hearing the contesting parties, the Court may or may not confirm the earlier ad-interim order. Ad-interim relief, once granted, can be vacated or affirmed only after application of mind by the concerned Court. Hence, the Courts must give necessary priority to the hearing of the prayer for interim relief where ad- interim relief has been granted. Though the High Court is not expected to record detailed reasons while dealing with the prayer for the grant of stay or interim relief, the order must give sufficient indication of the application of mind to the relevant factors.
An interim order passed after hearing the contesting parties cannot be vacated by the High Court without giving sufficient opportunity of being heard to the party whose prayer for interim relief has been granted……… the High Court must give necessary priority to the hearing of applications for vacating the stay, if the main case cannot be immediately taken up for hearing…… The High Courts cannot take recourse to the easy option of directing that the same should be heard along with the main case. The same principles will apply where ad-interim relief is granted.
[i] (2018) 16 SCC 299
[ii] 2024 INSC 150
[iii] (1992) 1 SCC 225
[iv] (2002) 4 SCC 578
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