Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 17.10.2026
Karnataka High Court Quashes ITP Act Proceedings
This Short Article has been prepared & written by Advocate G Sridharamurthy. The views expressed are based on his interpretation of the law. He can be reached at his email id sriadv3@gmail.com.
The Karnataka High Court has quashed two criminal cases against Maxim K. Kurian after the State failed to show that the officers who conducted the raids were legally appointed as Special Police Officers under the Immoral Traffic (Prevention) Act, 1956.
The order, delivered by Justice H.P. Sandesh on 15 October 2026, disposed of Criminal Petition Nos. 5994 of 2019 and 272 of 2020. The cases arose from separate police cases in Mangaluru but involved the same legal issue: whether the investigating officers had the statutory authority required to investigate offences under the ITP Act.
The two cases
In the first petition, Kurian, identified as accused No. 5, sought to quash proceedings in C.C. No. 3260/2017. The case stemmed from Crime No. 8/2017 registered at Barke Police Station and alleged offences under Sections 3(1), 4, 5 and 8 of the ITP Act.
The second petition concerned C.C. No. 2311/2019, arising from Crime No. 73/2017 registered at Mangaluru East Police Station. In that case, Kurian was accused No. 1 and faced allegations under Sections 4 and 5 of the Act.
Although the cases originated at different police stations, the Court heard them together because both turned on the same legal question concerning the authority of the officers involved.
Central legal issue: appointment of Special Police Officers
Kurian argued that the raids and investigations did not comply with Sections 13 and 15 of the ITP Act. Section 13 provides for the appointment of Special Police Officers to deal with offences under the statute, while Section 15 regulates searches conducted in connection with such offences.
The petitionerβs counsel contended that:
No government notification was produced showing that the investigating officers had been appointed as Special Police Officers under the Act.
The officers therefore lacked the specific statutory authority needed to conduct raids and investigate the alleged offences.
No search warrant had been obtained before the raids.
Even where a warrantless search may be permitted, it must be carried out by an authorized Special Police Officer and the legal safeguards must be followed.
The State submitted that the officer who conducted the raid held the rank of Inspector of Police. However, it did not rely on or produce a notification showing that the officer had been specially appointed by the State to deal with offences under the ITP Act.
Why the Court quashed the proceedings
The Court found that the State had not established that the investigating officer was an authorized Special Police Officer. Justice Sandesh noted that earlier Karnataka High Court decisions had treated compliance with the relevant ITP Act provisions as mandatory.
The Court relied on the principle from previous rulings that, where there is no notification demonstrating that an investigating officer qualifies as a Special Police Officer under the Act, the investigation cannot be sustained in law.
The decision underscores that an officerβs general police rank alone does not establish the special authorization required for investigations under a statute with its own procedural framework. For ITP Act cases, the State must be able to show the officerβs appointment under the Act when that authority is challenged.
The ruling
The High Court allowed both petitions and quashed the proceedings against Kurian in:
C.C. No. 3260/2017, arising from Barke Police Station Crime No. 8/2017; and
C.C. No. 2311/2019, arising from Mangaluru East Police Station Crime No. 73/2017.
Broader significance
The ruling reinforces the importance of procedural compliance in criminal investigations under special laws. It confirms that, in ITP Act prosecutions, the State must demonstrate that the officer conducting the raid or investigation was validly appointed under the statutory scheme.
Where that foundational requirement is not met, proceedings may be vulnerable to being quashed. The decision is based on the procedural validity of the investigations and does not determine the underlying factual allegations on their merits.
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Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 26.09.2026
Punjab & Haryana HC: Development Authority Is a βPromoterβ Under RERA and Liable for Delayed Possession
This Short Article has been prepared & written by Advocate Narendra Singh. The views expressed are based on his interpretation of the law. He can be reached at his email idamitnaren@outlook.com.
The Punjab and Haryana High Court has held that a Development Authority falls within the definition of βpromoterβ under the Real Estate (Regulation and Development) Act, 2016 (RERA) and cannot escape the statutory consequences of delayed possession merely because a commercial site was auctioned on an βas is where isβ basis or because the allotment terms contained a deemed-possession clause.
Dismissing two appeals filed by the Bathinda Development Authority, Justice Harkesh Manuja upheld the order of the Real Estate Appellate Tribunal, Punjab granting interest under Section 18 of the RERA Act to allottee Leela Gupta for delayed possession of two SCO sites.
Background: SCO Sites Purchased Through Auction and Transfer
The dispute concerned two SCO sites situated at Civil Lines, Power House Road, Bathinda.
Leela Gupta purchased SCO Site No. 1 through an open auction conducted by the Bathinda Development Authority on 5 August 2015. An allotment letter was issued on 1 December 2015 after payment of 20% of the principal amount along with 2% cancer cess.
Under the allotment letter, possession was required to be delivered within 90 days.
SCO Site No. 2 was not originally allotted to Gupta. She subsequently acquired it by transfer from the original allottees on 4 August 2017. Her grievance was that despite payment according to schedule, possession of the sites was not handed over in time because the necessary development work had not been completed.
Earlier Proceedings Before PUDA and RERA
Gupta initially sought relief from the Estate Officer, Bathinda, contending that interest should not be charged for the period during which the sites were not ready for possession.
After her representation was rejected, she approached the High Court through CWP No. 24881 of 2018. The High Court permitted her to submit an appeal-cum-representation to the Chief Administrator, PUDA for a speaking decision.
The Chief Administrator subsequently rejected her claim for waiver of interest on instalments but extended the moratorium period for construction, noting that development works in the commercial pocket had been completed on 16 June 2017.
Gupta thereafter approached the Real Estate Regulatory Authority, Punjab seeking three reliefs: refund of interest charged on instalments, extension of the non-construction period, and interest under Section 18 of RERA.
The Authority dismissed her complaints. On appeal, however, she restricted her claim only to interest for delayed possession under Section 18.
RERA Appellate Tribunal Awards Interest for Delayed Possession
The Real Estate Appellate Tribunal, Punjab allowed Gupta’s appeals on 12 May 2022.
For SCO Site No. 1, it awarded interest for delayed possession from 1 March 2016 to 19 October 2017.
For SCO Site No. 2, it awarded interest from 4 August 2017 to 19 October 2017 on the amount deposited up to that date, applying Rule 16 of the Punjab State Real Estate (Regulation and Development) Rules, 2017.
Bathinda Development Authority challenged those orders before the Punjab and Haryana High Court.
Development Authority Questions Maintainability of RERA Proceedings
The Authority argued that the dispute arose from allotments governed by the Punjab Regional and Town Planning and Development Act, 1995 (PRTPD Act).
According to it, after the Chief Administrator passed the order dated 27 May 2019 in exercise of appellate powers under Section 45 of the PRTPD Act, Gupta’s appropriate remedy was to file a revision before the State Government under Section 45(8) rather than initiating proceedings under RERA.
The High Court rejected this contention.
It noted that Gupta had relinquished her other claims and restricted the dispute before the RERA authorities to the statutory remedy of interest under Section 18 of RERA. Her claim was therefore independently founded on the RERA Act.
The Court also noted that the maintainability objection had not been raised by the Development Authority before either the RERA Authority or the Appellate Tribunal and was being advanced for the first time at a belated stage.
Section 18 RERA Creates Statutory Right to Interest for Delay
The High Court examined Section 18 of the RERA Act, which provides remedies where a promoter fails to complete or give possession of an apartment, plot or building according to the agreed terms.
Where the allottee does not wish to withdraw from the project, the proviso to Section 18(1) requires the promoter to pay interest for every month of delay until possession is handed over, at the prescribed rate.
The issue therefore turned on whether Bathinda Development Authority was a βpromoterβ and whether there had actually been delay in making the sites ready for possession.
Development Authority Expressly Covered by Definition of βPromoterβ
The High Court referred to Section 2(zk)(iii) of the RERA Act, which expressly includes a development authority or other public body within the definition of βpromoterβ in relation to specified buildings, apartments and plots.
The Court therefore held that there was βno doubtβ that Bathinda Development Authority was covered within the statutory definition of promoter.
This finding is important because it confirms that a public development authority cannot seek exemption from RERA’s promoter obligations merely because it is a statutory or State authority rather than a private developer.
βAs Is Where Isβ Clause Does Not Excuse Delayed Development
Bathinda Development Authority relied heavily on two provisions in the allotment letter.
First, the plot had been offered on an βas is where isβ basis. Second, the allotment letter stated that possession would be given within 90 days and, if the allottee did not take possession within that period, possession would be deemed to have been handed over on the due date.
The High Court was not persuaded.
It reasoned that if the βas is where isβ clause completely absolved the Authority from carrying out development, there would have been no reason for the Authority itself to spend resources and time undertaking development work.
The record showed that development of the site was, in fact, the Authority’s responsibility.
The Court importantly observed that:
βMere physical possession without any basic amenities would serve no purposeβ
because construction and commercial activity could not practically be carried out without the necessary basic infrastructure.
Electricity Is a Basic Amenity; Site Was Ready Only on 19 October 2017
The date on which the sites could genuinely be treated as ready for possession became a central issue.
An RTI response showed that:
civil and public health works were completed on 16 June 2017;
electrical works were completed on 28 April 2017;
transformers were installed on 1 March 2017; and
electricity supply became available only on 19 October 2017.
The Chief Administrator had treated 16 June 2017 as the completion date, apparently without treating actual electricity supply as essential.
The High Court disagreed.
It held that electricity was a basic amenity necessary for construction activity, particularly because machinery used at a construction site requires power. It therefore affirmed the Appellate Tribunal’s conclusion that the sites were actually ready for possession only on 19 October 2017.
Extension of Construction Moratorium Was an Indirect Admission of Delay
The Court also identified what it considered an inconsistency in the Authority’s stand.
The Chief Administrator had extended the three-year moratorium period for construction on the ground that the commercial pocket became ready only after development work was completed.
According to the High Court, if there had genuinely been no delay on the Authority’s part, there would have been no need to extend the construction moratorium.
The extension was therefore treated as an indirect admission through the Authority’s own conduct that delay had occurred.
Allottee Cannot Face Penalty for Delay While Promoter Faces No Consequence
The High Court also addressed the imbalance that would arise if the Authority’s interpretation were accepted.
It observed that an allottee could be required to pay penalty charges for failing to complete construction within the stipulated period. It would therefore be anomalous if there were no corresponding consequences for the promoter’s delay in providing possession, especially when Section 18 of RERA expressly provides a statutory remedy for such delay.
Supreme Court’s Arifur Rahman Khan v. DLF Southern Homes Applied
The High Court relied on the Supreme Court’s judgment in:
Wg. Cdr. Arifur Rahman Khan and Aleya Sultana v. DLF Southern Homes Pvt. Ltd., (2020) 16 SCC 512.
The Court referred to the Supreme Court’s recognition that agreements between developers and purchasers often do not operate on an equal footing: stringent obligations imposed on purchasers are frequently not mirrored by equivalent obligations on developers to meet timelines.
Bathinda Development Authority argued that Gupta had participated in the auction with her βeyes wide open.β
The High Court rejected this reasoning, observing that participation in an open auction could not mean that the allottee should have anticipated that the Authority itself would delay development work.
The fact that the site had been allotted through an auction did not confer any right upon the Authority to delay development. Once delay occurred, the statutory consequences under RERA had to follow.
State Development Authority Cannot Claim Preferential Treatment Over Private Promoter
The High Court made another significant observation concerning public development authorities.
It held that no concession could be claimed by a State Development Authority merely because it was a public body rather than a private promoter.
Indeed, the Court observed that the obligation upon the State was greater because it was itself a law-enforcement agency, particularly where it had maximised revenue by disposing of property through an open auction.
The ruling therefore places public development authorities squarely within the accountability framework established by RERA where the statutory definition of promoter is attracted.
Earlier PUDA Order Did Not Bar Section 18 Claim
The Authority further argued that the Chief Administrator’s order dated 27 May 2019 had never been challenged and continued to remain in force.
The High Court rejected this objection because the earlier proceeding concerned a different relief.
The Chief Administrator had rejected Gupta’s request that interest should not be charged on her instalments during the development period.
The RERA proceedings, by contrast, concerned her affirmative statutory entitlement to receive interest from the promoter for delayed possession under Section 18.
The two issues were therefore legally distinct.
Other Allottees Taking Possession Earlier Does Not Defeat Statutory Right
The Authority also claimed that similarly situated allottees had taken possession earlier.
The High Court noted that no material had been placed on record to substantiate this assertion. More importantly, even assuming it to be factually correct, the conduct of other allottees could not extinguish Gupta’s rights arising from the statutory provisions.
Final Decision: Bathinda Development Authority’s Appeals Dismissed
The Punjab and Haryana High Court found no reason to interfere with the Real Estate Appellate Tribunal’s order.
Both RERA Appeal No. 6 of 2023 and RERA Appeal No. 12 of 2023 filed by Bathinda Development Authority were dismissed.
Consequently, Leela Gupta succeeded, and the Appellate Tribunal’s award of delayed-possession interest remained intact:
SCO Site
Period for Which Interest Was Awarded
SCO Site No. 1
1 March 2016 to 19 October 2017
SCO Site No. 2
4 August 2017 to 19 October 2017
The interest was to operate on the deposited amount in accordance with the applicable RERA framework and Rule 16 of the Punjab State Real Estate (Regulation and Development) Rules, 2017.
Key Takeaway
The judgment establishes three important RERA principles. A Development Authority is expressly covered within the definition of βpromoterβ under Section 2(zk); an βas is where isβ or deemed-possession clause cannot automatically defeat the statutory entitlement under Section 18 where the site was not practically ready for possession; and essential infrastructure such as actual electricity supply may be relevant in determining when a commercial site became genuinely ready for possession.
Most importantly, the High Court made clear that State development authorities cannot claim a more favourable standard than private promoters when RERA obligations apply.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 26.09.2026
Supreme Court: Contractual Bar on Interest Cannot Be Invoked Belatedly After Consenting to Arbitration
This Short Article has been prepared & written by Arbitrator Shobhit Mallik. The views expressed are based on his interpretation of the law. He can be reached at his email idshobhit.Ica23@gmail.com.
The Supreme Court has held that a party cannot ordinarily raise a contractual or legal plea at a later stage of arbitration proceedings when it had the opportunity to raise the plea before the Arbitral Tribunal but failed to do so. Such conduct can amount to waiver or abandonment of the plea, particularly where allowing it later would prejudice the opposite party.
In Union of India v. M/s Susaka Pvt. Ltd. & Ors., the Supreme Court dismissed the Union of India/Railways’ appeal challenging an arbitral award of interest, holding that the Railways could not rely for the first time before the Supreme Court upon a contractual clause prohibiting interest when it had failed to properly raise and pursue that objection before the Arbitral Tribunal and the courts below.
Dispute Arose From Railway Works Contract
The dispute arose from a works contract awarded by the Union of India (Railways) to M/s Susaka Pvt. Ltd. on 19 December 1994 for repair work relating to 25 stators of TAO-659 Traction Motors of Electric Locomotives, Type WCAMI, at Electric Loco Shed, Valsad.
Disputes subsequently arose during execution of the contract. Since Clause 56(1) of the General Conditions of Contract (GCC) contained an arbitration mechanism, Susaka invoked arbitration and approached the Bombay High Court under Section 11(5) of the Arbitration and Conciliation Act, 1996 for constitution of an Arbitral Tribunal.
By an order dated 27 July 2001, the High Court, with the consent of the parties, referred the claims to a three-member Arbitral Tribunal consisting of Railway officials. Significantly, the reference expressly stated that the arbitrators would also be free to decide pre-reference interest, pendente lite interest, further interest and costs, considering the agreement.
Arbitral Tribunal Awards βΉ27.62 Lakh
The Arbitral Tribunal delivered a unanimous reasoned award dated 11 September 2002, partly allowing Susaka’s claims.
The award covered, among other things, loss due to under-utilisation of equipment, material purchased but not utilised, loss of profit, overheads, payment under the price-variation clause and interest.
The table reproduced on pages 5 and 6 of the Supreme Court judgment records a total award of βΉ27,62,214, including βΉ12,89,033 towards interest.
The central issue that eventually reached the Supreme Court concerned the Tribunal’s power to award interest for different periods. The award provided for pre-reference interest at 15% per annum, pendente lite interest at 12% per annum and post-award interest at 18% per annum.
Railways Challenges Award Under Section 34
Aggrieved by the award, the Union of India filed proceedings under Section 34 of the Arbitration and Conciliation Act, 1996 before a Single Judge of the Bombay High Court.
The Single Judge partly interfered with the award by modifying the date from which interest would be payable in relation to two claims. However, the Railways’ objections concerning the remaining claims were rejected and the award was otherwise upheld.
Susaka challenged the limited interference before the Division Bench. The Railways, however, did not file an appeal against the part of the Single Judge’s order rejecting its other objections. Consequently, that part of the award attained finality.
The Division Bench subsequently allowed Susaka’s appeal, holding that no ground under Section 34 had been established for modifying the award in relation to interest. This effectively restored the arbitral award in its entirety.
The Union of India then approached the Supreme Court.
Railways Relies on Clause 13(3) to Challenge Interest
Before the Supreme Court, the Railways relied heavily upon Clause 13(3) of the GCC.
According to the Railways, Clause 13(3) stipulated that no interest would be payable on earnest money, security deposit or amounts payable to the contractor under the contract, except Government securities.
It therefore argued that the Arbitral Tribunal had acted contrary to the contract in awarding interest and that the award was liable to be set aside under Section 34.
Susaka opposed the argument on a fundamental procedural ground: the Railways had not raised and pursued the Clause 13(3) objection before the Arbitral Tribunal or the courts below and therefore could not introduce it for the first time before the Supreme Court under Article 136 of the Constitution.
Supreme Court: Railways Had Consented to Arbitration of Interest Claim
The Supreme Court accepted Susaka’s objection.
The Court found that the Railways had not raised the plea based on Clause 13(3) in its reply before the Arbitral Tribunal. More importantly, during the Section 11(5) proceedings, the Railways had expressly consented to referring the question of interest to arbitration.
The Court observed that if the Railways intended to rely on Clause 13(3), it could have raised the objection when the dispute was referred to arbitration or expressly reserved its right to raise the objection before the Tribunal.
It did neither.
The Railways thereafter participated in the arbitration and allowed the Tribunal to adjudicate the interest issue on merits without specifically pleading Clause 13(3).
Raising a Ground in Section 34 Petition Is Not Enough If It Is Not Pressed
The Supreme Court also noticed an important procedural aspect.
Although the Railways included the Clause 13(3) objection as a ground in its Section 34 proceedings before the Single Judge, the ground was not pressed during arguments. It was also not subsequently raised before the Division Bench.
The Supreme Court therefore described the case as one of:
βwaiver or/and abandonment of a plea at the initial stage itself.β
Pleas Must Be Raised at the Appropriate Stage
The judgment lays down an important litigation and arbitration principle: where a pleaβwhether based on fact or lawβis available to a party, it must be raised at the appropriate stage in accordance with law.
If a party fails to raise the plea, or gives it up by consent, it may subsequently be precluded from resurrecting it on the principle of waiver, particularly where doing so would prejudice the opposite party.
The Court referred to the maxim βCuilibet licet renuntiare juri pro se introductoβ, explaining that a person may waive the advantage of a law made solely for his or her individual benefit and protection, provided no public right or public policy is infringed. Susaka Pvt. Ltd. & Ors.
Failure to Appeal Against Rejection of Other Claims Also Proved Fatal
There was another reason why the Railways’ challenge failed.
The Single Judge had substantially rejected the Railways’ Section 34 challenge except in relation to two interest claims. Yet the Railways did not appeal against the portion of the order rejecting its objections.
The Supreme Court held that this part of the Single Judge’s decision had therefore attained finality.
Had the Railways wished to keep those issues alive, it was required to challenge that portion before the Division Bench. Only thereafter could an adverse determination potentially have been pursued before the Supreme Court under Article 136.
Arbitral Tribunal Has Power to Award Interest
The Supreme Court also made important observations concerning an arbitrator’s power to award interest.
It held that an award of interest on arbitrable claims is not inherently illegal, contrary to public policy, per se bad in law or beyond the powers of an Arbitral Tribunal.
The Court specifically referred to Section 31(7)(a) and (b) of the Arbitration and Conciliation Act, 1996, observing that these provisions empower an Arbitral Tribunal to award interest on the awarded sum, although that power remains subject to the agreement between the parties.
This qualification is important: the Supreme Court did not hold that an arbitrator can disregard an express contractual prohibition on interest. Rather, the decision turned substantially on the Railways’ failure to timely raise and preserve its contractual objection.
Courts Should Not Lightly Interfere With Arbitral Awards
The Supreme Court further reiterated the limited nature of judicial interference with arbitral awards.
Once parties have chosen their arbitrators and authorised them to adjudicate specified disputes, their decision should ordinarily be respected. Courts should interfere only where the award falls within one of the grounds prescribed under Section 34 of the Arbitration and Conciliation Act, 1996.
This part of the judgment reinforces the principle that Section 34 proceedings are not intended to provide parties with an unrestricted opportunity to reargue matters already submitted to arbitration.
Supreme Court Refers to Firm Kaluram Sitaram v. Dominion of India
The judgment expressly refers to the Bombay High Court decision in:
Firm Kaluram Sitaram v. The Dominion of India, AIR 1954 Bombay 50.
The Supreme Court recalled former Chief Justice M.C. Chagla’s observations concerning the State’s reliance on technical defences against citizens.
Applying that principle, the Supreme Court criticised the Railways for pursuing a technical legal argument up to the Supreme Court even though the plea had not been properly raised at the relevant stages of the proceedings.
Final Decision: Union of India’s Appeal Dismissed
The Supreme Court ultimately found no merit in the Union of India’s appeal and dismissed it.
Accordingly, M/s Susaka Pvt. Ltd. succeeded before the Supreme Court, and the Railways’ attempt to challenge the award of interest by relying upon Clause 13(3) of the GCC failed.
The judgment is particularly significant for arbitration proceedings because it demonstrates that a potentially available contractual defence can be lost if it is not specifically pleaded, pressed and preserved at the appropriate stage.
It also makes an important distinction between the substantive contractual limitation on an arbitrator’s power to award interest and the procedural question of whether a party has preserved its right to invoke that limitation.
Key Takeaway
A party cannot participate in arbitration without raising an available contractual objection, allow the Tribunal to decide the issue on merits, fail to press the objection in Section 34 proceedings, and then seek to revive it for the first time before the Supreme Court.
The decision in Susaka therefore stands as an important authority on waiver and abandonment of pleas in arbitration proceedings, while also recognising that Section 31(7) empowers arbitrators to award interest subject to the parties’ agreement.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 26.09.2026
Bombay High Court: Railway Board Circular Cannot Override 2013 Land Acquisition Act
This Short Article has been prepared & written by Advocate Madhumita Jha. The views expressed are based on her interpretation of the law. She can be reached at her email idjhamadhumita27@gmail.com.
The Bombay High Court has held that tenants whose structures are acquired for a public project fall within the definition of βaffected familyβ under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, and are entitled to statutory rehabilitation and resettlement benefits.
The Division Bench rejected an attempt by the Dedicated Freight Corridor Corporation of India Limited (DFCCIL) to rely upon a Railway Board-approved Entitlement Matrix to restrict the tenants’ entitlement to merely three months’ notice and βΉ10,000 as shifting allowance.
The Court categorically held that administrative instructions issued by the Ministry of Railways cannot override the statutory provisions of the 2013 Land Acquisition Act. It directed payment of βΉ14.17 lakh to each petitioner, together with statutory interest under Section 80β9% per annum for the first year from taking possession and 15% per annum from the second year onwards.
Dispute Arose From Dedicated Freight Corridor Project in Raigad
The petitioners were tenants occupying structures acquired by DFCCIL for the Dedicated Freight Corridor passing through Alibag, District Raigad.
Their grievance was that although competent authorities had already confirmed their eligibility and quantified the monetary compensation payable to them, DFCCIL subsequently prevented the amounts from being disbursed.
The petitioners had approached the Appellate Authority for Rehabilitation in 2021 as members of affected families/project-affected persons. Possession of their structures was admittedly taken during 2021β2022.
Appellate Authority Had Already Declared Tenants Eligible for Compensation
On 16 June 2022, the Deputy Commissioner (Rehabilitation), Konkan Division, acting as the Appellate Authority, allowed the petitioners’ appeals and held that they were eligible to receive compensation.
Those orders referred to the Maharashtra Government Resolution dated 22 May 2018, which provided the mechanism for payment of compensation to affected persons.
DFCCIL filed review applications challenging the petitioners’ eligibility, but the review applications were rejected. Consequently, the orders confirming their eligibility remained undisturbed.
βΉ14.17 Lakh Compensation Determined for Each Petitioner
Following the determination of eligibility, the District Rehabilitation Officer submitted a proposal to the State Government seeking approval for payment.
Eventually, on 6 November 2025, the Deputy Collector (Rehabilitation), acting as Administrator for Rehabilitation for the project, passed a reasoned order determining compensation of:
βΉ14,17,000 for each petitioner
DFCCIL and the rehabilitation authority thereafter informed the concerned bank regarding payment. In fact, instructions were issued on 6 November 2025 for transferring a substantial portionββΉ10 lakh to each petitioner through RTGS.
The dispute took a different turn shortly thereafter.
DFCCIL Suddenly Halts Compensation
On 24 November 2025, the Project Manager of DFCCIL wrote to the District Rehabilitation Officer taking a position contrary to the steps already undertaken for payment.
DFCCIL asserted that because the petitioners were merely tenants, they were entitled only to:
three months’ written notice; and
βΉ10,000 towards shifting allowance.
For this position, DFCCIL relied upon an Entitlement Matrix based on its September 2012 Relief and Rehabilitation Plan.
The District Rehabilitation Officer responded on 8 December 2025, pointing out that the State Government had already approved the petitioners’ eligibility and their entitlement to the compensation.
Despite this, DFCCIL did not release the amounts. The petitioners issued a legal notice on 5 March 2026 and thereafter approached the Bombay High Court in April 2026.
DFCCIL Relies on Railway Board’s 2015 Entitlement Matrix
Before the High Court, DFCCIL relied principally on a letter dated 23 May 2015 issued by the Director Planning (Special), Ministry of Railways, Railway Board, to the Managing Director of DFCCIL.
The communication approved an Entitlement Matrix for Dedicated Freight Corridor projects based on DFCCIL’s September 2012 Rehabilitation and Resettlement Plan.
DFCCIL argued that the Matrix governed compensation payable to lessees and tenants.
It also contended that compensation had already been paid to the owners of the structures occupied by the petitioners and, therefore, the tenants could not separately claim the βΉ14.17 lakh quantified by the rehabilitation authority.
Another argument was based on the Maharashtra Government Resolution dated 22 May 2018. DFCCIL claimed that since the structures stood on Gaothan land, the second schedule to the Government Resolution applied and only owners were entitled to compensation.
Tenants Expressly Included in Definition of βAffected Familyβ
The High Court examined Section 3(c) of the 2013 Act, particularly Section 3(c)(ii).
The provision includes within βaffected familyβ a family that does not own land but whose member or members may be:
βagricultural labourers, tenants including any form of tenancyβ¦β
subject to the statutory requirements concerning the impact of acquisition on livelihood.
The Court found that it was undisputed that the petitioners were tenants in the structures acquired by DFCCIL.
It consequently held that the petitioners were covered by the statutory definition and were entitled to compensation under the 2013 Act by applying Schedule II.
Section 31 Requires Rehabilitation and Resettlement Award for Affected Families
The Division Bench also examined Section 31 of the 2013 Act, which requires the Collector to pass a Rehabilitation and Resettlement Award for each affected family in accordance with the entitlements under the Second Schedule.
Such an award may contain rehabilitation and resettlement amounts, bank account details, house sites, land allotments, subsistence and transportation allowances, amounts for cattle sheds and petty shops, benefits for artisans and small traders, employment-related entitlements, annuity and other statutory benefits.
Reading Section 31 together with Section 3(c) and Schedule II, the Court concluded that the petitioners’ status as tenants did not exclude them from the statutory rehabilitation framework.
The most significant legal finding concerns the relationship between the Railway Board’s administrative instructions and the 2013 Act.
The High Court rejected DFCCIL’s reliance on the Railway Board letter dated 23 May 2015 and the corresponding Entitlement Matrix.
The Bench held:
βSuch instructions cannot prevail upon the statutory provisionsβ
and found that the Railway Board communication could not override the statutory provisions of the 2013 Act.
Thus, an administrative compensation policy or departmental entitlement matrix cannot be invoked to reduce or take away a benefit that the governing legislation confers upon an eligible affected family.
DFCCIL’s Objection Was Raised at a Belated Stage
The High Court also found DFCCIL’s conduct significant.
The petitioners’ eligibility had already been determined by the Appellate Authority in June 2022. DFCCIL’s review applications had failed. The competent authority subsequently quantified compensation at βΉ14.17 lakh each.
More importantly, the Chief General Manager of DFCCIL had itself joined the competent authority in directing the bank to transfer βΉ10 lakh to each petitioner.
Only thereafter did the Project Manager issue the communication dated 24 November 2025 objecting to payment and invoking the 2015 Entitlement Matrix.
The Court characterised this objection as belated.
Government Resolution Also Could Not Reduce Statutory Benefits
DFCCIL’s reliance on the Maharashtra Government Resolution dated 22 May 2018 also failed.
The High Court noted that paragraph 6 of the Government Resolution itself recognised that where the compensation or relief available under the 2013 Act was higher, the higher statutory benefit would prevail.
The Bench connected this principle with Section 108 of the 2013 Act, which gives affected families the option to avail themselves of better compensation and rehabilitation and resettlement benefits.
Consequently, DFCCIL could not rely upon the second schedule to the Government Resolution to reduce the petitioners’ statutory entitlement.
Bombay HC Orders βΉ14.17 Lakh Compensation to Each Tenant
The Court rejected the grounds advanced by DFCCIL and allowed all the connected writ petitions.
It held that each petitioner was entitled to:
βΉ14,17,000 as compensation, along with statutory interest
The principal amount had already been deposited by DFCCIL. The Court therefore ordered that βΉ14.17 lakh be disbursed to each petitioner within two weeks.
9% Interest for First Year and 15% Thereafter
The petitioners had sought interest at 18% per annum.
The High Court did not grant the claimed 18% rate. Instead, it applied the statutory interest mechanism contained in Section 80 of the 2013 Act.
According to the judgment, delayed payment attracts:
9% per annum for the first year from the date possession was taken, and 15% per annum from the second year onwards.
The Court considered statutory interest appropriate because DFCCIL had taken an βunreasonable stand belatedlyβ and had deprived the petitioners of their rightful dues without justification.
It particularly noted that DFCCIL had initially directed substantial payment of βΉ10 lakh each through RTGS and then suddenly reversed its position and objected to the disbursement.
Time-Bound Directions for Payment of Interest
The High Court laid down a specific schedule for implementation.
The competent authority was directed to calculate the interest payable to each petitioner within four weeks.
It must thereafter communicate the calculation to the Chief General Manager and Project Manager of DFCCIL within one week.
DFCCIL must then deposit the interest amount with the competent authority within two weeks, following which the authority must disburse it to the petitioners within one further week.
Final Decision
The Bombay High Court made the rule absolute and allowed all seven connected writ petitions.
Each petitioner is to receive βΉ14.17 lakh plus statutory interest under Section 80 of the 2013 Act.
Key Takeaway
The judgment establishes an important principle for land acquisition and infrastructure projects: tenancy does not by itself exclude a person from rehabilitation and resettlement benefits under the 2013 Land Acquisition Act.
Where a tenant satisfies the statutory definition of an βaffected familyβ under Section 3(c), the entitlement must be determined under the Act, including Section 31 and Schedule II. An internal policy, project-specific Entitlement Matrix, Railway Board instruction or State Government resolution cannot be used to dilute a superior statutory entitlement.
The ruling is particularly significant for infrastructure projects undertaken by government corporations because the Court made clear that administrative instructions must yield to the governing legislation, while Section 108 protects an affected family’s entitlement to opt for better compensation and rehabilitation benefits.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 26.09.2026
Karnataka High Court:Civil Suit Cannot Be a Ground to Discharge Accused When Criminal Acts Are Alleged
This Short Article has been prepared & written by Advocate G Sridharamurthy. The views expressed are based on his interpretation of the law. He can be reached at his email id sriadv3@gmail.com.
The Karnataka High Court has held that the mere existence of an earlier civil suit arising from the dispute cannot be a ground to discharge an accused where the complaint and charge-sheet materials disclose prima facie allegations of independent criminal acts such as creation of documents, forgery and use of allegedly fabricated documents.
Allowing a petition filed by M/s Varsha Cables Private Ltd. and its Chairman and Managing Director Puttaraju P. Gowda, Justice H.P. Sandesh set aside an order of the Revisional Court which had discharged the accused and restored the Trial Court’s order rejecting the discharge application under Section 239 of the Code of Criminal Procedure, 1973.
The High Court emphasised that disputed defences cannot be adjudicated at the discharge stage and that questions surrounding allegedly created documents must be tested during trial.
Background of the Dispute
The proceedings originated from a private complaint filed by the complainants alleging criminal acts against the second respondent, B. Kumar, proprietor of M/s Varsha Industries.
The private complaint was referred for investigation under Section 156(3) CrPC, following which the Vijayanagara Police registered an FIR, investigated the allegations and filed a charge sheet. An additional charge sheet was also filed invoking offences relating to forgery and use of forged documents. VARSHA CABLESL PRIVATE LTD. KHC
The dispute had its background in the relationship between the parties concerning Varsha Cables Private Ltd. According to the complaint, the accused had previously been a Director of the company and later started carrying on business through Varsha Industries.
The complainants alleged that Varsha Industries began manufacturing and dealing in products including PVC insulated copper conductors and PVC/rubber insulated and non-insulated products, replicating the business being carried on by Varsha Cables.
Allegation of Misrepresentation to Customers
The complaint alleged that the accused represented to customers of Varsha Cables that the company had been restructured as M/s Varsha Industries and that its management had also been restructured.
Customers were allegedly requested to amend their vendor-registration records and direct fresh enquiries to Varsha Industries.
The complaint specifically referred to communications dated 24 October 2009 sent to customers including Cipla Limited, Goa and Jubilant Organosys Ltd., Mysore. According to the complainants, these representations resulted in prominent customers of Varsha Cables being diverted to Varsha Industries.
These remained allegations requiring adjudication at trial; the High Court did not make a final finding that the alleged acts had been proved.
Alleged Fabrication of Board Meeting Minutes and Use of Company Letterhead
A significant aspect of the case concerned documents allegedly created after an agreement dated 9 October 2009 between the parties.
The additional charge sheet alleged that Varsha Cables’ letterhead was used in a communication dated 21 October 2009 for changing a Bureau of Indian Standards (BIS) licence and that minutes of a purported Board meeting were created despite the allegation that no such meeting had taken place.
According to the additional charge sheet, the accused allegedly used the company’s letterhead after ceasing to be its Director with an intention to divert clients. The additional charge sheet consequently invoked Sections 468 and 471 IPC.
The High Court also recorded that letters dated 21 October and 4 November 2009 addressed to the Bureau of Indian Standards and minutes dated 12 October 2009 were among the documents relied upon by the complainants.
Trial Court Refuses to Discharge Accused
The accused sought discharge under Section 239 CrPC.
The Trial Court rejected the application on 23 December 2017 after taking note of allegations contained in the original as well as additional charge sheets.
Among other things, it considered the allegation that Board resolutions had been created and used for changing BIS licences standing in the name of Varsha Cables. It also noted allegations concerning duplicate letterheads and changes relating to the company’s telephone number.
The accused thereafter approached the Revisional Court.
Revisional Court Discharges Accused
The VII Additional Sessions Judge, Mysuru allowed Criminal Revision Petition No. 313 of 2018 on 21 March 2019 and discharged the accused.
The Revisional Court substantially treated the controversy as a civil dispute between the parties, taking into consideration the agreement and related civil proceedings.
Varsha Cables and its CMD then approached the Karnataka High Court under Section 482 CrPC, seeking restoration of the Trial Court’s refusal to discharge the accused.
Accused Argues Criminal Complaint Was Replica of Civil Suit
Before the High Court, the accused argued that a civil suit had already been instituted and that the allegations in the private criminal complaint substantially replicated those made in the civil proceedings.
It was submitted that the civil suit had been dismissed and that first appeals were pending. The accused therefore maintained that the controversy was essentially civil in character and that criminal prosecution should not be used to pursue the same dispute.
The complainants, on the other hand, argued that specific allegations of forgery, cheating, criminal breach of trust, fabrication and use of documents had been investigated and formed part of the charge-sheet materials. They contended that the Revisional Court had effectively evaluated the defence at a stage when only a prima facie assessment was permissible.
Karnataka HC: Revisional Court Went Beyond Scope of Discharge Proceedings
The High Court found fault with the manner in which the Revisional Court approached the case.
Justice Sandesh observed that the Revisional Court had extensively considered the terms of the agreement between the parties but had failed adequately to examine the allegations in the complaint, charge sheet and particularly the additional charge sheet concerning alleged creation and use of documents.
According to the High Court, the Revisional Court had effectively considered the accused’s defence while deciding whether discharge was justified.
That approach exceeded the permissible scope of the proceedings.
Evidentiary Value Cannot Be Decided at Discharge Stage
The High Court relied on the Supreme Court’s decision in State by Karnataka Lokayukta Police Station, Bengaluru v. M.R. Hiremath, (2019) 7 SCC 515, noting that entering into questions concerning the evidentiary value of prosecution material at the stage of deciding a discharge application is impermissible.
It also relied upon Srilekha Sentilkumar v. Deputy Superintendent of Police, CBI, ACB, Chennai, (2019) 7 SCC 82, where the Supreme Court recognised that disputed factual issues may be more appropriately adjudicated at trial after evidence is led by the parties.
In the present case, the High Court found sufficient charge-sheet material to permit the prosecution to proceed, particularly in relation to the accusations concerning creation of documents and alleged forgery.
Civil Proceedings Do Not Automatically Wipe Out Criminal Allegations
One of the most important findings of the judgment concerns the overlap between civil and criminal proceedings.
The High Court acknowledged that the civil suit had been filed before the criminal complaint and that the contents of the civil plaint and complaint were alleged to overlap.
However, it noted that the criminal complaint contained allegations concerning conduct after the agreement dated 9 October 2009, including alleged creation of documents, purported Board meeting minutes and transfer of records. These matters had also been considered during police investigation and in the additional charge sheet.
The Court therefore held that:
βthe very contention that civil suit was filed earlier and subsequently, criminal complaint was filed cannot be a ground to dischargeβ
where the record contains allegations of criminal acts that require adjudication.
Importantly, this does not amount to a finding that the accused committed forgery. The High Court held only that the allegations and materials were sufficient to require adjudication at trial.
Defence Cannot Be Adjudicated Under Section 239 CrPC
The High Court reiterated that, while considering an application under Section 239 CrPC, the court must determine whether there is material to frame charges or whether the accusations are groundless.
The Revisional Court had, in the High Court’s view, gone beyond this exercise by evaluating the defence based on the parties’ agreement while failing adequately to account for the accusations regarding creation of documents.
The Court therefore concluded that the Revisional Court had exercised its revisional powers beyond their permissible limit.
Complainant Has Right to Be Heard When Discharge May Terminate Criminal Proceedings
Another significant issue concerned the locus of the de facto complainant.
The accused relied upon M/s Kerala Transport Co. v. D.S. Soma Shekar & Others, arguing that after investigation and filing of the charge sheet, prosecution was primarily the responsibility of the State and the private complainant could not independently use criminal proceedings to pursue private vengeance.
The Karnataka High Court rejected the objection in the circumstances of this case.
It relied upon Sundeep Kumar Bafna v. State of Maharashtra & Another, (2014) 16 SCC 623, observing that while a complainant or informant does not have a vested right to directly conduct the prosecution, the complainant’s interest cannot simply be ignored when proceedings are likely to be terminated.
The Court also relied on J.K. International v. State (Govt. of NCT of Delhi), (2001) 3 SCC 462, which recognised the complainant’s right to be heard when criminal proceedings initiated on the complaint are sought to be quashed.
The High Court reasoned that allowing a revision seeking discharge could effectively terminate the proceedings initiated by the first informant, making an opportunity of hearing material to the complainant’s interests.
Supreme Court Precedents Considered
The judgment discusses several authorities concerning discharge, revision and participation of a complainant, including:
Case
Citation / Reference
Principle Discussed
Madhu Limaye v. State of Maharashtra
(1977) 4 SCC 551
Nature of orders concerning charge/discharge and revisional jurisdiction
Union of India v. Prafulla Kumar Samal
(1979) 3 SCC 4
Scope of judicial scrutiny at charge/discharge stage
Pranab Kumar Mitra v. State of West Bengal
AIR 1959 SC 144
Revisional jurisdiction
Thakur Ram v. State of Bihar
AIR 1966 SC 911
Role of State and private parties in criminal prosecution
Sundeep Kumar Bafna v. State of Maharashtra & Anr.
(2014) 16 SCC 623
Role and hearing of complainant/private party
State by Karnataka Lokayukta v. M.R. Hiremath
(2019) 7 SCC 515
Evidentiary value cannot be assessed at discharge stage
Srilekha Sentilkumar v. Deputy Superintendent of Police, CBI
(2019) 7 SCC 82
Disputed facts appropriately determined at trial
J.K. International v. State (Govt. of NCT of Delhi)
(2001) 3 SCC 462
Complainant’s opportunity of hearing where criminal proceedings are sought to be terminated
Sanjay Kumar Rai
Criminal Appeal No. 472/2021, decided 07.05.2021
Scope of revision against charge/discharge orders
These authorities were considered in determining the permissible scope of discharge/revisional proceedings and the complainant’s participation.
Final Decision: Varsha Cables’ Petition Allowed
The Karnataka High Court ultimately allowed the criminal petition.
It set aside the order dated 21 March 2019 passed by the VII Additional Sessions Judge, Mysuru in Criminal Revision Petition No. 313/2018 and restored the Trial Court’s order dated 23 December 2017 in C.C. No. 126/2014 rejecting the accused’s discharge application under Section 239 CrPC.
Accordingly, the accused was not discharged and the criminal proceedings are to continue.
The High Court expressly clarified that the observations made while deciding the petition shall not influence the Trial Court when considering the matter on merits. Therefore, the ruling does not determine the guilt or innocence of the accused; those issues remain for trial.
Key Takeaway
The ruling reinforces that the existence of a civil dispute or even an earlier civil suit does not automatically justify discharge from criminal proceedings where the complaint and investigation disclose separate prima facie allegations of criminal conduct.
At the Section 239 CrPC stage, courts are not expected to conduct a full trial, adjudicate disputed defences or finally determine the evidentiary worth of competing documents.
Where allegations concerning forgery, fabrication or use of allegedly created documents require evidence, those questions should ordinarily be determined during trial rather than through a discharge application.
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Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 25.09.2026
Bombay High Court Condones 143-Day Delay in Homebuyersβ RERA Appeal; Says Tribunal Adopted Rigid Approach
This Short Article has been prepared & written by Advocate Narendra Singh. The views expressed are based on his interpretation of the law. He can be reached at his email idamitnaren@outlook.com.
In an important ruling concerning condonation of delay in appeals under the Real Estate (Regulation and Development) Act, 2016 (RERA), the Bombay High Court has set aside an order of the Maharashtra Real Estate Appellate Tribunal which had refused to condone a 143-day delay by two homebuyers in filing their appeal.
Justice N.J. Jamadar held that the Appellate Tribunal had adopted a βslightly rigid approachβ and failed to apply the justice-oriented principles governing the expression βsufficient causeβ. The Court emphasised that the requirement of explaining each day’s delay cannot be stretched to demand βmathematical precision and exactitudeβ.
The High Court accordingly condoned the 143-day delay, subject to payment of βΉ20,000 as costs, and directed the Appellate Tribunal to decide the homebuyers’ substantive appeal in accordance with law.
Homebuyers Purchased Two Flats in βSodah Sadanβ Project
The appellants, Atul Hiralal Shah and another, had entered into two registered agreements on 4 October 2016 for purchase of two flats in a project known as βSodah Sadanβ, promoted by the respondents.
Under the agreements, possession was to be delivered by 31 December 2018. According to the appellants, despite repeated extensions, the promoters failed to perform their obligations.
The homebuyers consequently approached the Maharashtra Real Estate Regulatory Authority seeking possession, interest, compensation and other reliefs.
MahaRERA Grants Delayed-Possession Interest but Rejects Possession Claim
By an order dated 30 June 2025, MahaRERA partly allowed the complaint.
Although the Authority rejected the claim for possession, it directed the promoters to pay interest for delayed delivery of the flats from 1 January 2019 until the date of offer of possession with Occupancy Certificate (OC).
The interest was directed to be calculated on the actual amount paid by the homebuyers towards the flat consideration at the rate of SBI’s Marginal Cost Lending Rate (MCLR) plus 2%, as prescribed under Section 18 of RERA and the applicable Rules.
However, the Authority further directed that the interest amount would become payable after the promoters obtained the full Occupancy Certificate. The promoters were also permitted to adjust the interest against outstanding consideration and interest thereon, if any.
This condition ultimately became important in the High Court’s consideration of why the homebuyers had delayed filing their appeal.
Homebuyers Waited for Promoter to Obtain Occupancy Certificate
The appellants explained that after the MahaRERA order they genuinely believed that the promoters would obtain the full OC and comply with the direction for payment of delayed-possession interest.
They therefore continued pursuing the promoters for the Occupancy Certificate.
According to them, it eventually became apparent that there was no meaningful progress at the project site and no immediate possibility of obtaining the OC. They then decided to challenge the MahaRERA order before the Appellate Tribunal.
This resulted in a delay of 143 days, for which they sought condonation through Miscellaneous Application No. 117 of 2026.
Appellate Tribunal Refuses to Condon 143-Day Delay
On 6 April 2026, the Maharashtra Real Estate Appellate Tribunal rejected the delay-condonation application.
The Tribunal acknowledged that a liberal and justice-oriented approach is ordinarily adopted in such matters, but held that this principle could not defeat the substantive law of limitation contained in Section 3 of the Limitation Act, 1963.
It concluded that the reasons advanced by the homebuyers did not amount to βsufficient causeβ. It further held that the appellants had failed to account for each and every day’s delay and appeared negligent in not pursuing their appellate remedy within the prescribed time.
The homebuyers consequently approached the Bombay High Court in Second Appeal.
Substantial Question of Law Before Bombay High Court
The High Court formulated the following substantial question of law:
βWhether the Appellate Tribunal did not apply correct principles in deciding the application for condonation of delay in preferring the appeal, and, thereby misdirected itself in rejecting the application for condonation of delay?β
Considering the nature of the controversy, the Court proceeded to finally decide the Second Appeal with the consent of the parties.
Homebuyers: Tribunal Adopted an Unduly Rigid Approach
Senior Advocate Naushad Engineer, appearing for the appellants, argued that MahaRERA had placed the homebuyers in a peculiar position.
Although the Authority granted them delayed-possession interest, actual payment of that interest was deferred until the promoter obtained the Occupancy Certificate.
The homebuyers therefore had a legitimate reason to pursue the promoter for obtaining the OC so that the relief granted by MahaRERA could become enforceable.
It was further argued that 143 days was not an inordinate delay and that the Tribunal had adopted an excessively rigid standard instead of examining the explanation in the context of the object of RERA and the circumstances faced by the allottees.
Promoter: Non-Compliance With an Order Cannot Justify Delayed Appeal
The promoters opposed the appeal.
They argued that non-compliance with the MahaRERA order might possibly explain delay in seeking its enforcement, but could not constitute sufficient cause for delaying an appeal against that very order.
According to the promoters, unless a satisfactory cause was shown for not approaching the appellate forum within limitation, neither the Tribunal nor the Court could exercise the power of condonation.
They also objected to documents which the homebuyers sought to rely upon before the High Court on the ground that those documents had not been produced before the Appellate Tribunal.
High Court: Explanation Must Be Assessed in Context of Real-Life Circumstances
Justice Jamadar acknowledged that, viewed in a very strict sense, non-compliance with the MahaRERA order might not by itself constitute a satisfactory explanation for delay in appealing.
But the Court held that the explanation could not be assessed in isolation.
It had to be considered βin the light of the attendant facts of the case and the situation in life of the parties.β
This contextual approach became central to the High Court’s reasoning.
βSufficient Causeβ Is Elastic and Cannot Be Put in a Straitjacket
The Court examined the principles underlying limitation law and noted that limitation statutes are sometimes described as βstatutes of peaceβ because public policy requires finality in litigation.
At the same time, the expression βsufficient causeβ governing condonation of delay has traditionally received a liberal construction where doing so advances substantial justice and the party is not guilty of negligence, inaction or lack of bona fides.
The High Court observed that βsufficient causeβ cannot be confined in a straitjacket and that no universal formula can determine whether a particular explanation is sufficient.
Supreme Court Principles on Condonation of Delay Considered
The High Court relied upon Pundlik Jalan Patil v. Executive Engineer, Jalgaon Medium Project, (2008) 17 SCC 448, concerning the public-policy rationale underlying limitation statutes.
It also extensively referred to the Supreme Court’s decision in Shivamma (Dead) by LRs. v. Karnataka Housing Board & Ors., 2025 SCC OnLine SC 1969, which in turn considered Pathapati Subba Reddy (Died) by LRs. v. Special Deputy Collector (LA), 2024 SCC OnLine SC 513.
The principles extracted by the Court recognise that while Section 3 of the Limitation Act must be applied strictly, Section 5 requires a more liberal construction. At the same time, a justice-oriented approach cannot be used to condone inordinate delay accompanied by negligence, lack of diligence or want of bona fides.
The Court emphasised that the inquiry must ultimately consider whether the explanation is real, bona fide and free from negligence, viewed contextually and having regard to the totality of circumstances.
Appellate Tribunal Adopted a βSlightly Rigid Approachβ
Applying those principles, the High Court found that the Appellate Tribunal had been too rigid.
The sufficiency of the explanation ought to have been examined on the touchstones of:
reasonableness, bona fides and diligence, coupled with the necessary degree of justice-oriented flexibility.
The High Court clarified that delay should not be condoned where there is gross negligence, deliberate inaction or blatant indifference to statutory timelines. But it expressly found:
βThat is not the case at hand.β
Waiting for Occupancy Certificate Was Not Wholly Unreasonable
A particularly important aspect of the judgment concerns the practical predicament faced by the allottees.
Possession had originally been promised by 31 December 2018, yet even when the matter reached the High Court, the promoters had neither offered possession nor obtained the full Occupancy Certificate.
The Court held that the allottees’ expectation that the promoter would comply with its statutory and contractual obligations and the MahaRERA order could not be described as wholly unreasonable.
MahaRERA Order Made Interest Dependent on an Event Beyond Allotteesβ Control
The High Court found the structure of the MahaRERA order itself significant.
Although delayed-possession interest had been granted, payment was deferred until the promoter obtained the Occupancy Certificate.
Thus, enforcement of the monetary relief granted to the allottees had effectively been made contingent upon an event which was outside their control and dependent upon the acts of the promoter.
In these circumstances, the allottees’ decision to pursue the promoter in the bona fide expectation that the OC would shortly be obtained could not properly be treated as negligence.
βEvery Dayβs Delayβ Rule Cannot Be Applied With Mathematical Precision
The Bombay High Court then made an important observation concerning the frequently invoked requirement that a litigant explain βeach and every day’s delayβ.
The Court held that:
The principle that a party seeking condonation must account for each and every day’s delay cannot be stretched to the point of mathematical precision and exactitude.
It also found that a delay of 143 days was neither huge nor inordinate in the circumstances of the case.
This observation is likely to be particularly relevant in future delay-condonation disputes where tribunals adopt an overly mechanical day-by-day approach despite a coherent overall explanation.
Occupancy Certificate Still Not Obtained
During the hearing, counsel for the promoters fairly informed the High Court that, according to his instructions, the Occupancy Certificate had still not been obtained.
The Court observed that if the allottees attempted to enforce the MahaRERA order in that situation, such proceedings could be termed premature because the liability to pay interest had itself been deferred until the uncertain future event of obtaining the OC.
Whether such a condition in the MahaRERA order was legally justified would therefore need to be examined by the Appellate Tribunal once the appeal was restored.
Bombay High Court Allows Appeal and Condones Delay
The High Court answered the substantial question of law in favour of the appellants and allowed the Second Appeal.
It consequently:
quashed and set aside the Appellate Tribunal’s order dated 6 April 2026;
allowed the application seeking condonation of delay;
condoned the 143-day delay in filing the RERA appeal;
imposed βΉ20,000 costs, payable by the appellants to the respondents within four weeks from uploading of the order; and
requested the Maharashtra Real Estate Appellate Tribunal to decide the substantive appeal in accordance with law.
Important: High Court Did Not Finally Decide the Homebuyersβ RERA Claims
The judgment must be understood within its procedural limits.
The Bombay High Court did not finally decide whether the homebuyers are entitled to possession, whether the manner in which MahaRERA deferred payment of interest until receipt of the OC is legally valid, or what substantive relief should ultimately be granted.
The Court’s ruling concerns the rejection of the delay-condonation application. Those substantive RERA issues will now be examined by the Maharashtra Real Estate Appellate Tribunal after restoration of the appeal.
Why the Judgment Is Significant
The ruling reinforces that limitation law must strike a balance between finality of proceedings and substantial justice. Courts and tribunals cannot disregard statutory limitation periods, but neither should the concept of βsufficient causeβ be applied through an excessively mechanical formula.
In RERA disputes particularly, the surrounding circumstances faced by homebuyersβincluding dependence upon the promoter for completion, possession and Occupancy Certificatesβmay be relevant while assessing whether their conduct reflects negligence or a bona fide attempt to secure compliance.
The judgment also sends a clear message that the requirement to explain delay does not necessarily mean that a litigant must produce a mathematically precise explanation for every individual day where the overall conduct demonstrates reasonable diligence and bona fides.
Key Takeaway
A 143-day delay in filing a RERA appeal cannot be rejected through an excessively rigid application of limitation principles where the allottees acted bona fide and their explanation is consistent with the surrounding circumstances.
The requirement to explain βeach and every day’s delayβ cannot be stretched to mathematical precision.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 25.09.2026
Supreme Court: Arbitrator Cannot Award Pre-Reference Interest When Contract Expressly Bars It
This Short Article has been prepared & written by Arbitrator Shobhit Mallik. The views expressed are based on his interpretation of the law. He can be reached at his email idshobhit.Ica23@gmail.com.
In an important ruling concerning interest in arbitration arising from public works contracts, the Supreme Court has held that where the parties have expressly agreed to a contractual clause barring interest on delayed payments, an Arbitral Tribunal cannot award pre-reference interest contrary to that bargain.
Allowing the appeal filed by North Eastern Electric Power Corporation Limited (NEEPCO) against Astra Construction Private Limited, the Supreme Court set aside the Meghalaya High Court judgment to the extent that it had restored pre-reference interest awarded by the Arbitral Tribunal.
The Court held that Clause 54 of the General Conditions of Contract (GCC) constituted an express contractual prohibition against such interest and therefore restricted the Tribunal’s power under Section 31(7)(a) of the Arbitration and Conciliation Act, 1996.
Background of the Dispute
NEEPCO had invited tenders on 12 June 1995 for civil works relating to the main plant and auxiliary building of a Gas Turbine Power Project at Ram Chandra Nagar, Tripura. Astra Construction’s tender was accepted and the parties executed a formal agreement on 23 May 1996.
The estimated contract value was approximately βΉ17.09 crore, and the work was stipulated to be completed by 26 March 1997.
Disputes subsequently arose and were referred to arbitration. By an award dated 5 June 2015, the Arbitral Tribunal found that the delay in execution of the project was attributable to NEEPCO.
Four claims raised by Astra Construction were allowed and a principal amount of βΉ3.30 crore was awarded. In addition, the Tribunal granted:
Component
Interest awarded
Pre-reference interest
12% per annum
Pendente lite interest
9% per annum
Future interest
9% per annum
The pre-reference interest at 12% was awarded on each of the claims allowed by the Tribunal.
Commercial Court Interferes with Interest Component
NEEPCO challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996.
The Commercial Court, by its judgment dated 15 February 2024, relied upon the Supreme Court’s decision in Sayeed Ahmed & Company v. State of U.P. and concluded that Clause 54 barred the grant of interest.
Accordingly, the Commercial Court set aside the grant of pre-suit and pendente lite interest on Claim Nos. 2, 3, 4 and 5, while otherwise upholding the award.
Meghalaya High Court Restores Arbitral Award
Astra Construction challenged the Commercial Court’s decision under Section 37 of the 1996 Act.
The Meghalaya High Court relied upon the Supreme Court’s earlier judgment in State of U.P. v. Harish Chandra & Co., (1999) 1 SCC 63.
It held that the contractual bar under Clause 54 was confined to interest claimed on money or balances withheld because of a dispute and did not extend to every other head of claim.
On that reasoning, the High Court restored the Arbitral Tribunal’s award in its entirety.
NEEPCO consequently approached the Supreme Court.
NEEPCO Confines Supreme Court Challenge to Pre-Reference Interest
Before the Supreme Court, NEEPCO confined its challenge to the High Court’s restoration of pre-reference interest.
NEEPCO argued that the High Court had wrongly relied upon Harish Chandra, which arose under the Arbitration Act, 1940, without properly appreciating the later jurisprudence under the Arbitration and Conciliation Act, 1996.
NEEPCO relied particularly upon Sayeed Ahmed, Jai Prakash Associates Ltd. v. Tehri Hydro Development Corporation Ltd., Ferro Concrete Construction (India) Pvt. Ltd. v. State of Rajasthan and ONGC v. G & T Beckfield Drilling Services Pvt. Ltd.
Astra Construction, on the other hand, argued that NEEPCO had not raised the Clause 54 objection before the Arbitral Tribunal and had therefore waived its right to raise the issue. It relied upon Union of India v. Susaka Pvt. Ltd. & Ors., (2018) 2 SCC 182.
Supreme Court Explains Major Difference Between 1940 and 1996 Arbitration Laws
A significant part of the judgment explains the evolution of the law governing an arbitrator’s power to award interest.
Under the Arbitration Act, 1940, there was no express statutory provision empowering an arbitrator to award interest. The Supreme Court’s Constitution Bench in Secretary, Irrigation Department, Government of Orissa v. G.C. Roy, (1992) 1 SCC 508 developed the principle that where an agreement did not prohibit interest and the claim was referred to arbitration, interest could be treated as an implied term of the agreement.
The position changed materially under the 1996 Act.
Section 31(7)(a) expressly begins with the words βUnless otherwise agreed by the partiesβ. The Supreme Court held that these words give primacy to party autonomy: the statutory power of an arbitrator to award interest is subject to what the contracting parties have agreed.
Contract Can Restrict Arbitrator’s Power to Award Interest
Referring to Pam Developments Private Limited v. State of West Bengal, (2024) 10 SCC 715, the Court explained that under the 1996 Act an express contractual bar can restrict the arbitrator’s power to award pre-reference and pendente lite interest.
Unlike the position under the 1940 Act, it is not necessary that the contractual provision specifically state that the βarbitratorβ has no power to award interest. If the agreement itself bars payment of interest, Section 31(7)(a) respects that contractual arrangement.
The Court reiterated that Section 31(7)(a) reflects a deliberate legislative shift toward party autonomy.
Pre-Reference and Pendente Lite Interest Are Legally Distinct
The judgment also draws an important distinction between pre-reference interest and pendente lite interest.
The Court reaffirmed that pendente lite interest is a matter of procedural law governed by Section 31(7)(a), whereas pre-reference interest is governed by substantive law.
Consequently, entitlement to pre-reference interest cannot be derived solely from Section 31(7)(a). It must have a basis in:
an express or implied agreement between the parties;
a statutory provision such as Section 3 of the Interest Act, 1978; or
established mercantile usage.
Clause 54 Was the Decisive Contractual Provision
Clause 54 of the NEEPCO contract was titled βNo Claim for Delayed Payment due to Dispute Etc.β
It provided that no claim for interest or damages would be entertained in respect of money or balances lying with NEEPCO because of a dispute, difference or misunderstanding, or in respect of delay by the Engineer-in-Charge in making periodical or final payments, or in any other respect whatsoever.
The central question was whether this clause resembled the provision interpreted in Harish Chandra or the broader contractual bars considered in Sayeed Ahmed and the later THDC decisions.
Supreme Court’s Important Comparison of Contract Clauses
The Supreme Court itself provided a comparative table on page 13 of the judgment, placing Clause 54 alongside the clauses considered in Harish Chandra, Sayeed Ahmed and THDC-II.
The Court found an important drafting difference.
In Harish Chandra, the contractual restriction essentially dealt with money withheld because of a dispute. It did not create a separate and independent prohibition concerning money simply paid late where no underlying dispute existed.
That was why the Harish Chandra Bench had concluded that the provision did not generally prevent an arbitrator from awarding interest for delayed payment.
Clause 54 Goes Further Than Harish Chandra Clause
Clause 54 in the NEEPCO contract was materially different.
The Supreme Court found that it covered two independent situations:
money or balances lying with the Corporation because of a dispute, difference or misunderstanding; and
delay by the Engineer-in-Charge in making periodical or final payments.
The second limb was decisive.
By separately and expressly covering delayed payment, Clause 54 prohibited an interest claim arising from delay even where there was no dispute about the underlying payment.
The Court therefore concluded that the High Court had erred in treating Clause 54 as equivalent to the clause considered in Harish Chandra.
Sayeed Ahmed and THDC Line of Cases Applies
The Supreme Court instead found Clause 54 materially similar to the clauses considered in Sayeed Ahmed and THDC-II.
In those cases, separate language dealing with delayed payment was treated as a complete contractual restriction on the arbitrator’s authority to grant interest for the relevant periods.
The Supreme Court expressly agreed with that reasoning and held that the Sayeed Ahmed line of decisionsβnot Harish Chandraβgoverned the NEEPCO dispute.
NEEPCO Had Not Waived the Contractual Objection
The Supreme Court also rejected Astra Construction’s contention that NEEPCO had waived its right to rely upon Clause 54 because the objection had allegedly not been taken before the Arbitral Tribunal.
The record showed that NEEPCO had specifically raised the plea in its Statement of Defence dated 23 August 2012 before the Tribunal. The waiver argument therefore failed on facts.
Supreme Court’s Final Decision
The Supreme Court ultimately held that Clause 54 barred the grant of pre-reference interest.
It further held that the Arbitral Tribunal, by granting such interest despite the contractual prohibition, exceeded the bounds of its jurisdiction under Section 31(7)(a).
Accordingly, the Meghalaya High Court judgment was set aside to the extent it had restored pre-reference interest, and NEEPCO’s appeal was allowed without any order as to costs.
Importantly, NEEPCO had confined its Supreme Court challenge to the restoration of pre-reference interest. The judgment should therefore not be read as the Supreme Court setting aside the entire arbitral award or the βΉ3.30 crore principal amount.
Why This Judgment Is Important for Government and Infrastructure Contracts
The judgment has considerable significance for EPC contracts, construction contracts, power projects, infrastructure agreements and government/public-sector works contracts containing βno-interestβ clauses.
Its central message is that Section 31(7)(a) does not give an arbitrator an unrestricted power to award interest. The statutory power operates subject to the parties’ agreement.
The precise drafting of the contractual clause becomes critical. A clause limited merely to amounts withheld because of a dispute may have a different legal effect from a clause that independently and expressly prohibits interest for delayed periodical or final payments.
The decision therefore reinforces both party autonomy and the importance of carefully construing the actual words of the contract before determining whether pre-reference interest is legally recoverable.
Key Takeaway
Where a contract governed by the Arbitration and Conciliation Act, 1996 expressly bars interest on delayed payments, an Arbitral Tribunal cannot override that bargain and award pre-reference interest under Section 31(7)(a). The wording of the contractual bar is decisive.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 25.09.2026
Bombay High Court Awards βΉ8.14 Lakh Compensation to Parents of Passenger Who Fell From Train
This Short Article has been prepared & written by Advocate Madhumita Jha. The views expressed are based on her interpretation of the law. She can be reached at her email idjhamadhumita27@gmail.com.
The Bombay High Court has awarded βΉ8,14,641 as compensation to the parents of a 26-year-old railway passenger who died after falling from a local train, setting aside a Railway Claims Tribunal order that had treated the death as a case of trespassing on railway tracks.
Justice Aarti Sathe held that entries in railway records may be admissible under Section 191 of the Railways Act, 1989, but they do not become conclusive proof merely because they form part of official railway records. Their reliability and evidentiary value must still be judicially tested, particularly when they conflict with independent evidence.
The Court found that the Railway Claims Tribunal had ignored the inquest panchanama, relied heavily on a DRM report containing only a tentative conclusion, and reached a finding of trespassing despite there being no eyewitness or other evidence establishing that the deceased was crossing the railway tracks.
Parents Challenge Rejection of Railway Compensation Claim
The appeal was filed by Waman Maruti Suryawanshi and Prabhavati Waman Suryawanshi, parents of deceased Rahul Waman Suryawanshi, challenging the Railway Claims Tribunal, Mumbai’s judgment dated 20 September 2019, which had dismissed their compensation claim.
The appeal was filed under Section 23 of the Railway Claims Tribunal Act, 1987.
At the relevant time, Rahul was employed with the Maharashtra Industrial Development Corporation (MIDC) and, according to his parents, was the sole breadwinner of the family. They claimed to have been financially dependent upon him.
Parents Said Son Accidentally Fell From Moving Local Train
According to the appellants, on 22 March 2015, Rahul purchased a valid railway ticket at Ghansoli Railway Station and boarded a local train for Airoli.
Their case was that while the train was travelling between Ghansoli and Rabale railway stations, Rahul accidentally fell from the moving train, suffered serious injuries and died before he could be admitted to hospital.
The parents further claimed that a railway ticket was recovered from Rahul’s body and recorded in the inquest panchanama, though the ticket was subsequently misplaced by them.
They filed a compensation claim under Section 124A of the Railways Act, 1989 on 9 April 2015.
Railways Claimed Deceased Was Trespassing
Central Railway disputed the claim.
Following a statutory investigation under the Railway Passengers (Manner of Investigation of Untoward Incident) Rules, 2003, the Divisional Railway Manager’s report concluded that Rahul had been trespassing on the railway track and was injured after being hit by a train.
The Railways relied, among other things, on a Station Master’s memo recording that an unknown person aged about 26 years had allegedly been hit by an unknown train while trespassing.
On that basis, the Railways denied that Rahul’s death constituted an βuntoward incidentβ under Section 123(c)(2) and also disputed that he was a bona fide passenger.
Tribunal Found Him to Be a Bona Fide Passenger but Still Rejected Compensation
Significantly, the Railway Claims Tribunal itself found from the inquest panchanama that Rahul had been carrying a valid railway ticket and was therefore a bona fide passenger.
However, the Tribunal nevertheless concluded that the parents had failed to establish that Rahul had fallen from a local train.
It instead accepted the theory that he had been knocked down by an unknown train between Ghansoli and Rabale and consequently dismissed the compensation claim.
This apparent inconsistency became an important issue before the Bombay High Court.
No Eyewitness Supported Railwaysβ Trespassing Theory
The High Court found the Tribunal’s conclusion erroneous.
Justice Sathe noted that there was βabsolutely no eyewitnessβ and no evidence led by the Railways to establish that Rahul was actually crossing or trespassing on the railway tracks.
The Tribunal had essentially relied upon the DRM report and Station Master’s memo without independently examining whether the factual conclusion recorded therein was correct.
More importantly, the office note forming part of the DRM report itself did not conclusively state that Rahul was trespassing. It merely stated that the incident βmight have taken place while the victim was crossing Railway Track.β
The High Court therefore found that a tentative departmental conclusion could not, without supporting evidence, establish trespassing.
Inquest Panchanama Recorded Fall From Local Train and Recovery of Ticket
The High Court attached considerable significance to the inquest panchanama, which the Tribunal had failed to properly consider.
The document recorded that Rahul had βfallen down from unknown local trainβ and sustained injuries.
It also expressly recorded that when his body was checked, authorities found, among other belongings, a railway ticket.
The panchanama further recorded the conclusion that Rahul had died due to a fall from an unknown local train after sustaining serious injuries, subject to determination of the medical cause of death through post-mortem examination.
The High Court observed that the DRM report had been prepared while ignoring this crucial recording in the inquest panchanama.
Railway Records Admissible, But Not Conclusive Proof
One of the most significant legal findings in the judgment concerns Section 191 of the Railways Act.
The Railways argued that the DRM report resulted from a statutory investigation and had sufficient evidentiary value under Section 191.
The High Court rejected the argument that this gave the report conclusive status.
Justice Sathe held that Section 191 makes entries contained in railway records admissible in evidence, but:
βthe same does not render them conclusive proof as facts stated therein.β
The credibility of such records must still be judicially tested for reliability and corroboration, particularly where the railway records conflict with independent evidence.
For this proposition, the Court also relied upon the Orissa High Court’s decision in Basanta Mangaraj & Anr. v. Union of India, F.A.O. No. 170 of 2025.
Accidental Fall From Passenger Train Is an βUntoward Incidentβ
Section 123(c)(2) of the Railways Act expressly includes within the definition of an βuntoward incidentβ the accidental falling of a passenger from a train carrying passengers.
The High Court noted that the Tribunal had already found Rahul to be a bona fide passenger carrying a valid ticket.
Once that finding existed, the Tribunal could not simply rely upon the Station Master’s memo and DRM report to conclude that there was no untoward incident, particularly in the absence of evidence establishing trespassing.
Negligence of Passenger Does Not by Itself Defeat Compensation
The High Court relied upon the Supreme Court decisions in Jameela & Ors. v. Union of India, 2010 ACJ 2453 and Union of India v. Rina Devi, 2018 ACJ 1441.
The judgment reiterated that where a passenger falls from a running train during the journey, the incident constitutes an untoward incident and the Railways would be liable unless the case falls within one of the statutory exceptions under Section 124A.
The statutory exceptions include death or injury caused by suicide or attempted suicide, self-inflicted injury, the passenger’s own criminal act, intoxication or insanity, and specified natural or medical causes.
The Court referred to Jameela for the distinction between ordinary negligence and the βcriminal actβ contemplated by the proviso to Section 124A. The Supreme Court had explained that even negligent or rash conduct, without more, does not necessarily amount to the criminal act contemplated by the statutory exception.
Tribunal Cannot Act as Expert on Nature of Injuries
The High Court also criticised the Tribunal’s attempt to infer from the nature of Rahul’s injuries that he must have been knocked down or run over by a train rather than having fallen from one.
Justice Sathe held that the Tribunal was not an expert body competent to draw such a medical or technical conclusion without supporting evidence.
There was nothing on record establishing that the injuries were of a kind that could only have resulted from being struck by a train.
The Court therefore held that the Tribunal’s personal opinion regarding the nature of the injuries could not become the decisive basis for determining how the accident occurred.
Railways Failed to Establish Section 124A Exception
The High Court further found that the Tribunal had failed to properly examine whether Rahul’s death actually fell within any of the exceptions contained in clauses (a) to (e) of the proviso to Section 124A.
In the absence of such a finding, denial of compensation was held to be legally unsustainable.
The Court accordingly concluded that the Tribunal’s judgment deserved to be set aside.
Railways Act Is Beneficial Legislation and Must Receive Liberal Interpretation
Justice Sathe also emphasised the beneficial nature of the Railways Act.
Rahul’s father and mother were undisputedly his dependants within the meaning of Section 123(b).
The Court observed that where legislation is beneficial in nature, it should receive a liberal interpretation and, where two constructions are reasonably possible, the interpretation favouring the beneficiary should be preferred.
According to the High Court, the Tribunal had adopted a narrow and erroneous interpretation which deprived the deceased passenger’s family of the benefit intended by the legislation.
Compensation: βΉ8 Lakh or βΉ4 Lakh Plus Interest?
The accident occurred on 22 March 2015, when the prescribed compensation for death was βΉ4 lakh.
However, by the time the Tribunal delivered its judgment on 20 September 2019, the Railway Accidents and Untoward Incidents (Compensation) Rules had been amended and compensation for death had been enhanced to βΉ8 lakh.
Applying the principle in Rina Devi, the High Court compared the enhanced statutory compensation with the original βΉ4 lakh amount together with applicable interest.
The Court applied interest at 9% per annum from the date of the accident, finding that βΉ4 lakh together with interest up to the date of its judgment came to βΉ8,14,641.
Since this was higher than the amended fixed compensation of βΉ8 lakh, the Court awarded the higher figure.
Bombay High Court Awards βΉ8,14,641 to Parents
The High Court ultimately allowed the First Appeal and quashed the Railway Claims Tribunal’s judgment dated 20 September 2019.
The parents’ compensation claim was allowed for βΉ8,14,641, to be distributed equally between them.
Central Railway was directed to deposit the amount into their bank accounts within eight weeks from the date on which the appellants furnish their bank details to the Chief Claim Officer, Central Railway.
If the Railways fails to deposit the compensation within the stipulated period, the amount will carry further interest at 9% per annum until payment.
Key Takeaway
The judgment establishes an important evidentiary principle for railway compensation cases: departmental railway records such as DRM reports and Station Master memos may be admissible, but they are not conclusive proof of how an accident occurred.
Where the Railways alleges trespassing, its internal records must still withstand judicial scrutiny and be tested against independent evidence. A tentative departmental statement that an accident βmightβ have occurred while crossing railway tracks cannot automatically outweigh an inquest panchanama, the recovery of a valid railway ticket and the absence of any eyewitness supporting the trespassing theory.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 25.09.2026
Karnataka High Court: Criminal Antecedents Alone Cannot Justify Rejection of Bail
This Short Article has been prepared & written by Advocate G Sridharamurthy. The views expressed are based on his interpretation of the law. He can be reached at his email id sriadv3@gmail.com.
The Karnataka High Court has granted regular bail to a 23-year-old accused in a case concerning alleged preparation to commit dacoity, reiterating the Supreme Court’s principle that criminal antecedents cannot, by themselves, be the sole ground for rejecting bail when an accused is otherwise entitled to release.
Justice S. Vishwajith Shetty allowed the petition after taking into account that the investigation had been completed, the charge sheet had already been filed, the petitioner had been granted bail in his earlier criminal cases, and he had undertaken to cooperate with the Trial Court for speedy disposal of the proceedings.
Background of the Case
The petitioner, Sudeep, was arrayed as Accused No. 1 in S.C. No. 156/2025, pending before the VI Additional District and Sessions Judge, Tumakuru.
The proceedings arose from Crime No. 87/2025, registered by Hebburu Police Station, Tumakuru District, for offences punishable under Sections 310(4) and 310(5) of the Bharatiya Nyaya Sanhita, 2023.
Sudeep approached the Karnataka High Court seeking regular bail under Section 483 of the BNSS, 2023.
The criminal petition itself records the corresponding reference to Section 439 of the erstwhile Code of Criminal Procedure while seeking bail under the current BNSS framework.
FIR Initially Registered Against Unknown Persons
The case originated from information received on 20 May 2025 from Byregowda G.S., a police officer attached to Hebburu Police Station.
On the basis of the information, the FIR was initially registered against four to five unknown persons.
Sudeep was arrested on the same day, 20 May 2025, and was thereafter remanded to judicial custody. Following completion of the investigation, police filed a charge sheet against five persons, with Sudeep shown as Accused No. 1.
His earlier bail application before the Trial Court in Criminal Miscellaneous No. 630/2026 was rejected on 20 May 2026, following which he approached the High Court.
Allegation: Accused Were Preparing to Commit Dacoity
According to the prosecution case recorded in the order, the accused persons had allegedly prepared themselves to commit dacoity and were armed with weapons.
The first informant, acting upon credible information, registered the case against unknown persons. A raid was subsequently conducted at the location where the accused were allegedly preparing to commit the offence.
Five persons were apprehended during the raid, and Sudeep was one of them.
These allegations remain part of the pending criminal prosecution; the High Court’s bail order does not constitute a finding on their truth or otherwise.
Investigation Completed and Charge Sheet Filed
An important consideration for the High Court was that the investigation had already been completed and the charge sheet filed.
The order also records that the petitioner had previous criminal cases against him. However, in those earlier cases, he was stated to have already been enlarged on bail.
The existence of those antecedents therefore led the High Court to consider the Supreme Court’s decision in Prabhakar Tewari v. State of Uttar Pradesh and Another, (2020) 11 SCC 648.
Criminal Antecedents Cannot Be Sole Ground for Refusing Bail
The Karnataka High Court specifically relied on Prabhakar Tewari for the proposition that:
a person’s criminal antecedents cannot be the sole ground to reject bail if the person is otherwise found entitled to it.
The principle was directly applied while considering Sudeep’s bail application.
The ruling is significant because it reiterates that the mere existence of earlier criminal cases does not automatically create an absolute bar against bail.
Criminal antecedents may remain a relevant consideration in deciding a bail application, but the High Court’s order makes clearβfollowing the Supreme Court precedentβthat they cannot operate as the sole reason for rejection where the overall circumstances otherwise justify release.
Petitioner Undertakes to Cooperate With Trial
The High Court further recorded Sudeep’s undertaking that he would cooperate before the Trial Court for speedy disposal of the case.
Considering this undertaking along with the completion of investigation, filing of the charge sheet and the principle concerning criminal antecedents, Justice Shetty concluded that the petitioner’s prayer for regular bail deserved to be answered in the affirmative, subject to appropriate safeguards.
The petition was accordingly allowed.
βΉ1 Lakh Personal Bond and Two Sureties
The High Court directed Sudeep to be released on regular bail in S.C. No. 156/2025, subject to several conditions.
He was required to execute a personal bond of βΉ1,00,000 with two sureties for the like amount to the satisfaction of the jurisdictional court.
The petitioner was also directed to appear regularly on all dates of hearing before the Trial Court unless his appearance was specifically exempted for valid reasons.
Monthly Police Station Attendance for One Year
The High Court imposed additional safeguards while granting bail.
Sudeep was prohibited from directly or indirectly threatening or tampering with prosecution witnesses and was directed not to involve himself in similar offences in the future.
He was further prohibited from leaving the jurisdiction of the Trial Court without its permission until disposal of the criminal case.
Importantly, the Court directed him to appear before the Station House Officer, Hebburu Police Station, on the third Sunday of every month between 10:00 AM and 1:00 PM, and mark his attendance for one year from the date of his release.
Supreme Court Judgment Relied Upon
The principal judicial precedent expressly relied upon in the order is:
Prabhakar Tewari v. State of Uttar Pradesh and Another, (2020) 11 SCC 648 β cited for the proposition that criminal antecedents cannot be the sole basis for refusing bail where the accused is otherwise entitled to bail.
Why the Decision Matters
The Karnataka High Court’s order reinforces an important principle in bail jurisprudence: criminal antecedents are relevant, but they are not necessarily determinative.
A bail court must examine the circumstances of the case as a whole. In the present matter, the Court considered the completion of investigation, filing of the charge sheet, the petitioner’s bail status in earlier cases and his undertaking to cooperate with the trial.
At the same time, the Court balanced the petitioner’s liberty against the interests of the prosecution by imposing stringent conditions concerning attendance, witnesses, territorial movement and monthly reporting to the police station.
The order should therefore not be read as holding that previous criminal cases are irrelevant to bail. Its narrower principle, drawn directly from Prabhakar Tewari, is that antecedents cannot constitute the sole ground for rejection when the accused is otherwise found entitled to bail.
Key Takeaway
The Karnataka High Court has reiterated that previous criminal antecedents, standing alone, cannot justify denial of regular bail. Where investigation is complete, the charge sheet has been filed and other circumstances support release, the accused may be granted bail subject to appropriate conditions designed to secure attendance and protect the trial.
Aadrikaa Legal Services is a trusted legal and regulatory support partner providing end-to-end legal solutions to law firms, corporate organizations, and businesses across India. We specialize in paralegal services, litigation support, tax and regulatory matters, delivering reliable, efficient, and result-oriented legal assistance.
Our services include comprehensive paralegal support, drafting and documentation, legal research, case management, litigation handling, and representation support across various judicial and quasi-judicial forums. We also assist in direct and indirect tax matters, customs, GST, corporate regulatory compliance, and legal advisory.
Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 24.09.2026
Bombay HC Upholds Developerβs Cancellation of Flat Allotment After Buyer Failed to Pay Stamp Duty; Orders Refund With Interest
This Short Article has been prepared & written by Advocate Narendra Singh. The views expressed are based on his interpretation of the law. He can be reached at his email idamitnaren@outlook.com.
In a significant ruling concerning the obligations of homebuyers and promoters under the Real Estate (Regulation and Development) Act, 2016 (RERA), the Bombay High Court has held that a developer was justified in terminating a flat allotment where the allottee failed to actually pay the requisite stamp duty and registration charges despite repeated opportunities to execute the Agreement for Sale.
Justice Sandeep V. Marne held that MahaRERA and the Maharashtra Real Estate Appellate Tribunal had erred in directing JP Builders and Developers to execute a registered Agreement for Sale in favour of the allottee, Santosh Amarsingh Sandhu. The Court found that the promoter was ready and willing to execute the agreement, whereas the allottee had failed to complete the stamp-duty and registration formalities.
At the same time, the High Court held that the developer could not retain the allottee’s booking amount of βΉ12.30 lakh despite the valid termination. It directed that the amount be refunded with interest at SBI MCLR + 2%, calculated from 12 July 2016 until actual repayment.
Background: Flat Originally Booked in Proposed A-Wing
The dispute arose from a residential development at Airoli, Navi Mumbai. JP Builders and Developers had undertaken development of land belonging to Airoli Cooperative Housing Society Ltd.
The project involved issues concerning additional FSI. The developer initially contemplated a ground-plus-30-storey building, but the additional FSI expected by the society did not fully materialise. The construction plans were eventually scaled down to a ground-plus-19-floor building.
Flat No. A-502 had originally been allotted to Vandana Nagendra Kharatmol and Nagendra Piraji Kharatmol for βΉ48.75 lakh. They paid βΉ12.30 lakh but later lost interest in the purchase because construction could not commence while litigation concerning FSI remained pending.
Thereafter, a fresh allotment letter dated 11 July 2013 was issued in favour of Santosh Sandhu for the same flat at a consideration of βΉ48.75 lakh, recording payment of βΉ12.30 lakh by him.
Original Flat Could Not Be Constructed
The originally contemplated Flat A-502 ultimately could not be constructed because the proposed 30-storey structure had to be reduced to 19 floors.
After receiving a revised Commencement Certificate on 26 April 2019, the developer asked Sandhu to select another flat. He selected Flat No. 1208 on the 12th floor, which the developer agreed to allot subject to floor-rise charges of βΉ1.75 lakh.
The developer then called upon him to pay stamp duty and registration charges so that the Agreement for Sale could be executed. The allottee, however, said he was facing financial difficulty and asked the promoter to bear the stamp duty, with a proposal to reimburse it through the home-loan disbursement.
The developer eventually terminated the transaction by notice dated 30 July 2019.
MahaRERA Directed Developer to Execute Agreement for Sale
The allottee approached MahaRERA in November 2019.
By an interim order dated 6 March 2020, MahaRERA relied upon Section 13 of RERA, noting that more than 10% of the agreed consideration had been paid without execution of a registered Agreement for Sale. It directed the developer to execute an agreement for another flat of equal area as chosen by the allottee.
That direction was effectively confirmed by MahaRERA’s final order dated 8 October 2020.
The Maharashtra Real Estate Appellate Tribunal subsequently dismissed the promoter’s appeal and partly allowed the allottee’s appeal. In addition to maintaining the direction concerning the flat, it ordered JP Builders to pay interest on βΉ12.30 lakh at SBI MCLR + 2% from 12 July 2016 until possession, with the interest to be adjusted against the balance consideration.
The Tribunal also restrained the developer from creating third-party rights in the flat and from charging floor-rise charges.
Both sides therefore approached the Bombay High Court in cross-appeals.
Key Question: Was Stamp Duty Actually Paid?
A central issue before the High Court was whether the allottee had actually paid the stamp duty and registration charges required for execution of the Agreement for Sale.
The allottee claimed that he had paid βΉ4.35 lakh towards stamp duty and βΉ30,000 towards registration charges and relied upon an email dated 9 July 2019, through which he claimed to have forwarded proof of payment to the developer.
However, the documentary record revealed a crucial problem.
The Court found that although βΉ4.65 lakh had been transferred to a Punjab National Bank account for the purpose of making the statutory payment, the amount was never actually credited to the Stamp Authority or Registration Authority.
A letter subsequently written by the allottee to the bank on 18 January 2020 itself indicated that the required challan and e-payment receipt had not been generated. The bank eventually reversed the amount and returned βΉ4.65 lakh to the allottee.
Transferring Money to Bank Is Not Payment of Stamp Duty: Bombay HC
The High Court drew an important distinction between merely making funds available to a bank and actually paying statutory stamp duty.
Justice Marne observed that making provision for stamp duty and transferring money to the banker did not mean that the statutory charges had actually been paid.
There was no evidence showing that βΉ4.65 lakh was transferred to the accounts of the concerned government authorities. Nor were the necessary challans generated.
The Court consequently held that the allottee had not paid the stamp duty and registration charges before 30 July 2019, when the developer terminated the transaction.
Developer Sent Repeated Notices for Registration
The High Court also examined the chronology leading to cancellation.
After the revised plans were sanctioned on 26 April 2019, JP Builders issued communications dated 3 May 2019, 28 May 2019 and 24 June 2019, asking the allottee to complete payment of stamp duty and registration charges and execute the registered Agreement for Sale.
In an email dated 30 June 2019, the allottee expressly stated that he did not then have the necessary cash to pay the stamp duty. He proposed either that the developer wait three months for him to arrange the funds or that the developer initially bear the statutory charges and recover them through his proposed home loan.
Further communications followed on 2 July and 9 July 2019. When no proof of actual statutory payment was produced, the developer terminated the allotment on 30 July 2019.
MahaRERA Mechanically Applied Section 13: High Court
The High Court found fault with the approach adopted by MahaRERA and the Appellate Tribunal.
According to the Court, both authorities had mechanically relied upon Section 13 of RERA to hold the promoter responsible for non-execution of the Agreement for Sale without adequately examining the events preceding the termination.
The Court noted that once the revised construction plans became clear in April 2019, the promoter promptly asked the allottee to execute the registered agreement. It was the allottee who did not complete the necessary stamp-duty and registration formalities.
The Court therefore concluded that the promoter could not be blamed merely because an Agreement for Sale had not ultimately been registered.
βPromoter Is Not Expected to Wait Endlesslyβ
The judgment records that even after the termination, the allottee did not promptly establish payment of the statutory charges. The βΉ4.65 lakh that had remained with the bank was eventually refunded to him, and the record did not show that he thereafter paid the stamp duty.
The Court held that the allottee himself was responsible for the failure to execute the Agreement for Sale and that the developer was ready and willing to execute it.
Accordingly, the Court found the termination dated 30 July 2019 to be valid, observing that the promoter was not expected to wait endlessly.
The High Court consequently held that MahaRERA and the Appellate Tribunal had erred in directing the developer to execute the registered Agreement for Sale.
Buyer Still Entitled to Refund of Entire βΉ12.30 Lakh
The validity of termination, however, did not permit the promoter to retain the buyer’s money.
JP Builders had earlier sought to refund βΉ11.07 lakh after deducting βΉ1.23 lakh as earnest money deposit.
The High Court held that despite the valid termination, the promoter was not entitled to retain the βΉ12.30 lakh booking amount or deduct any amount towards EMD.
Accordingly, the entire βΉ12.30 lakh was required to be returned to the allottee.
Interest at SBI MCLR + 2% Maintained
The Court also balanced the equities on interest.
Although the allottee was responsible for the failure of the transaction after 30 July 2019, he had been made to wait for a considerable period for construction of the flat.
The High Court therefore maintained the interest rate fixed by the Appellate Tribunal β SBI MCLR + 2% β but altered the nature of the relief. Instead of interest continuing until possession and being adjusted against the balance consideration, the interest would run on the refundable booking amount of βΉ12.30 lakh from 12 July 2016 until the date on which the amount is actually returned.
Claim for Adjustment of Earlier Buyersβ βΉ12.30 Lakh Rejected
Sandhu separately contended that amounts paid by the original allottees, the Kharatmols, should also be treated as part of his payment to the developer.
The Appellate Tribunal had rejected this claim after finding that the Kharatmols’ βΉ12.30 lakh had been returned to them and that there was no sufficient documentary evidence to establish that Sandhu had paid the promoter more than his own booking amount of βΉ12.30 lakh.
The High Court agreed.
It noted that the fresh allotment letter dated 11 July 2013 recorded a total consideration of βΉ48.75 lakh and payment of only βΉ12.30 lakh by Sandhu. It contained no provision for adjusting the earlier allottees’ consideration.
The allottee’s own email of 30 June 2019, in which he stated that approximately βΉ33 lakh remained payable out of the βΉ48.75 lakh consideration, also undermined the assertion that βΉ28.75 lakh had already been paid.
Significance of the Judgment
The ruling is significant because it demonstrates that Section 13 of RERA cannot be applied in isolation from the conduct of the parties and the factual circumstances preventing execution of the Agreement for Sale.
Where a promoter is demonstrably ready to execute the agreement and repeatedly calls upon an allottee to complete necessary statutory formalities, an allottee’s own failure to pay stamp duty and registration charges can become material in determining whether subsequent termination is justified. At the same time, the judgment makes an equally important distinction between valid termination of an allotment and entitlement to retain the buyer’s money. Even though JP Builders succeeded on the legality of the cancellation, the High Court did not permit it to forfeit the βΉ12.30 lakh booking amount and preserved interest in favour of the allottee.
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