Summary
The Delhi High Court had declined to entertain the Khosla Group's application under Section 340 CrPC for prosecution of the Bakshi Group for perjury, because the Supreme Court's consent judgment of 08.05.2014 had left the connected disputes to the CLB/NCLT; it later recalled that judgment on a review application under Order XLVII CPC, on the ground that the Company Petition had in fact been withdrawn. The Supreme Court set the recall aside: proceedings under Section 340 CrPC are criminal in nature and governed by the CrPC alone, so a review under the CPC is not maintainable; Section 362 CrPC bars alteration or review of a signed judgment save for clerical or arithmetical errors; the limited 'procedural review' exception is not available where the ground was known to the applicant and withheld at the original hearing.
Issues
- Whether a review or recall of an order passed in a proceeding initiated under Section 340 CrPC is permissible in view of Section 362 CrPC.
- Whether an application for review under Order XLVII of the Code of Civil Procedure, 1908 lies against an order in a Section 340 CrPC proceeding.
- Whether the High Court's recall of its judgment, on the ground that the withdrawal of the Company Petition had not been brought to its notice, fell within the 'procedural review' exception to Section 362 CrPC.
Provisions considered
- Section 362 (equivalent to Section 403, Bharatiya Nagarik Suraksha Sanhita, 2023), Code of Criminal Procedure, 1973Quoting the section, the Court held that once a criminal court signs its judgment or final order it is functus officio and cannot alter or review it except to correct a clerical or arithmetical error or where the CrPC or another law so provides; the bar cannot be circumvented through Section 482 and applies stricto sensu. The only relaxation is a 'procedural review' (lack of inherent jurisdiction, fraud on the court, a mistake of the court causing prejudice, non-service or death of a necessary party), and only where the ground was not available in the original proceedings. The High Court's recall was a substantive review in the garb of a procedural one. (¶¶ 22, 23, 24, 27, 28, 29, 30, 31, 32, 33, 34, 34A, 43, 44, 45)
- Section 340, Code of Criminal Procedure, 1973A Section 340 inquiry determines whether a court should make a written complaint to the Magistrate for prosecution of an offence committed in or in relation to a proceeding before it; it is not administrative or merely procedural but the initial step towards a criminal prosecution for offences under the IPC affecting the administration of justice. Such a proceeding is therefore criminal in nature and attracts all the procedural safeguards and consequences of the CrPC, including Section 362. (¶¶ 2, 14, 15, 17, 21, 26, 37, 38, 39)
- Sections 4 and 2(g), Code of Criminal Procedure, 1973Section 4(1), quoted by the Court, mandates that all offences under the IPC be investigated, inquired into, tried and otherwise dealt with under the CrPC; 'inquiry' under Section 2(g) means every inquiry other than a trial conducted under the Code. Since the CrPC is a self-contained code, no other procedural law applies to proceedings under it unless specifically provided. (¶¶ 36, 38, 39)
- Order XLVII, Code of Civil Procedure, 1908The Khosla Group's review application was filed under Order XLVII CPC against the order in the Section 340 CrPC proceeding. The Court held that the CPC contains no provision permitting review in proceedings of a criminal nature initiated under the CrPC, so the application was patently not maintainable and could not have been entertained. (¶¶ 21A, 35, 40, 43)
- Section 482, Code of Criminal Procedure, 1973Following Sanjeev Kapoor, the Court reiterated that the inherent power cannot be used to alter or review a judgment in the face of the express bar in Section 362. (¶¶ 30, 34)
Held
- Section 362 CrPC bars a criminal court, once it has signed its judgment or final order, from altering or reviewing it except to correct a clerical or arithmetical error or where the CrPC or another law in force expressly so provides; the court becomes functus officio on signing, the prohibition is complete and applies to the High Court in its appellate, revisional or original jurisdiction, and it cannot be circumvented by invoking Section 482. (¶¶ 27, 28, 29, 30, 34)
- A limited 'procedural review', as distinct from a 'substantive review' on merits, is inherent in every court: a criminal court may recall or review its judgment where (a) the power is expressly conferred by the CrPC or another law, (b) it lacked inherent jurisdiction, (c) the order was obtained by fraud or collusion, (d) a mistake of the court caused prejudice to a party, or (e) non-service or death of a necessary party was not brought to its notice. These exceptions are available only if the ground did not exist or was not available at the time of the original proceedings; a ground that was available but not raised, or errors attributable to a party's conscious omission, cannot found a recall, and the power cannot be used to circumvent the finality of the judicial process. (¶¶ 31, 32, 33, 34, 34A)
- A proceeding under Section 340 CrPC is criminal in nature: it is the initial step towards prosecution for offences under the IPC affecting the administration of justice, and the nature of a proceeding is determined by its substance and the consequences it may entail. It is governed by the CrPC, a self-contained code, and no other procedural law applies unless specifically provided. A review application under Order XLVII CPC against an order in such a proceeding is therefore patently not maintainable. (¶¶ 36, 37, 38, 39, 40)
- The High Court's judgment of 13.08.2020 was not premised exclusively on the pendency of the Company Petition but on the intertwined nature of the perjury allegations with the disputes before the NCLT and on the Supreme Court's binding consent judgment of 08.05.2014 vesting those matters in the CLB/NCLT and directing the High Court not to proceed with the earlier Section 340 application; withdrawal of the Company Petition did not disturb those directions, and a recall application seeking to circumvent them could not be held maintainable. (¶¶ 41, 42)
- The recall did not fall within the 'procedural review' exception: the Khosla Group was heard, had itself withdrawn the Company Petition more than six months before the judgment, and was recorded as having told the High Court that the NCLT was still seized of it. The ground for recall was fully available at the original hearing and its suppression appeared to be an intentional attempt to mislead; recalling the judgment on that basis, under the garb of procedural review, was a substantive review barred by Section 362 and an abuse of process. (¶¶ 43, 44, 45)
Result
Appeal allowed; High Court order dated 05.05.2021 recalling its judgment dated 13.08.2020 and directing the Section 340 CrPC application to be listed for hearing set aside; pending applications disposed of.