10 Mar 2024
No automatic vacation of stay orders granted by the High Courts after six months
In a significant decision, a five-judge Constitution Bench of the Hon’ble Supreme Court has overruled a 2018 judgment, wherein it had directed automatic expiry of interim stay orders granted by the High Courts after a period of six months. It was held that such a direction cannot be issued by the Supreme Court in the exercise of its jurisdiction under Article 142 of the Constitution of India. (High Court Bar Association Allahabad v. State Of Uttar Pradesh & Ors., 2024 SCC OnLine SC 207)
In the Asian Resurfacing case, a three-judge bench of the Supreme Court, in light of the increasing pendency of case, had earlier directed:
“…In an attempt to remedy this situation, 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 finalised.”
(Asian Resurfacing of Road Agency Private Limited & Anr. v. Central Bureau of Investigation, (2018) 16 SCC 299)
The principal question referred for consideration to the Constitution Bench was whether the Supreme Court, in the exercise of its jurisdiction under Article 142, could order automatic vacation of interim orders passed by the High Courts on the expiry of a certain period. Answering the said question in negative, the Constitution Bench held that the jurisdiction under Article 142 cannot be exercised to nullify the benefits derived by a large number of litigants based on judicial orders validly passed in their favour.
The Hon’ble Apex Court further held that principles of natural justice mandate that an order of vacating interim relief shall be passed only after hearing all the affected parties. An order of vacating interim relief passed without hearing the beneficiary of the order is against the basic tenets of justice. The Court went one step further to note that even if the legislature were to come out with such a provision for automatic vacation of stay, the same may not stand judicial scrutiny as it may suffer from manifest arbitrariness.
Another important observation in the case was that the power of the High Court under Article 227 of the Constitution to have judicial superintendence over all the courts within its jurisdiction includes the power to stay the proceedings before such courts. A blanket direction for vacation of stay would amount to interference with the jurisdiction conferred on the High Court. Such a constraint on the power of the High Court would be tantamount to making a dent on its jurisdiction under Article 226 of the Constitution, which has been recognised as a part of the basic structure of the Constitution.
In a significant decision, a five-judge Constitution Bench of the Hon’ble Supreme Court has overruled a 2018 judgment, wherein it had directed automatic expiry of interim stay orders granted by the High Courts after a period of six months. It was held that such a direction cannot be issued by the Supreme Court in the exercise of its jurisdiction under Article 142 of the Constitution of India. (High Court Bar Association Allahabad v. State Of Uttar Pradesh & Ors., 2024 SCC OnLine SC 207)
In the Asian Resurfacing case, a three-judge bench of the Supreme Court, in light of the increasing pendency of case, had earlier directed:
“…In an attempt to remedy this situation, 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 finalised.”
(Asian Resurfacing of Road Agency Private Limited & Anr. v. Central Bureau of Investigation, (2018) 16 SCC 299)
The principal question referred for consideration to the Constitution Bench was whether the Supreme Court, in the exercise of its jurisdiction under Article 142, could order automatic vacation of interim orders passed by the High Courts on the expiry of a certain period. Answering the said question in negative, the Constitution Bench held that the jurisdiction under Article 142 cannot be exercised to nullify the benefits derived by a large number of litigants based on judicial orders validly passed in their favour.
The Hon’ble Apex Court further held that principles of natural justice mandate that an order of vacating interim relief shall be passed only after hearing all the affected parties. An order of vacating interim relief passed without hearing the beneficiary of the order is against the basic tenets of justice. The Court went one step further to note that even if the legislature were to come out with such a provision for automatic vacation of stay, the same may not stand judicial scrutiny as it may suffer from manifest arbitrariness.
Another important observation in the case was that the power of the High Court under Article 227 of the Constitution to have judicial superintendence over all the courts within its jurisdiction includes the power to stay the proceedings before such courts. A blanket direction for vacation of stay would amount to interference with the jurisdiction conferred on the High Court. Such a constraint on the power of the High Court would be tantamount to making a dent on its jurisdiction under Article 226 of the Constitution, which has been recognised as a part of the basic structure of the Constitution.