Two-judge panel must follow prior three-judge decision; if clearly wrong, refer to three-judge bench with reasons

A two-judge Bench must ordinarily follow a prior three-judge decision; if it finds that three-judge authority is so clearly wrong that it cannot be followed, the proper procedure is to refer the matter to a three-judge Bench with reasons why the earlier three-judge ruling cannot be followed. Only if that subsequent three-judge Bench also overturns the earlier three-judge decision is reference to a five-judge Bench justified. The Court ordered the matter placed before a three-judge Bench in January 2002.

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Issues:
1. Can two learned judges of the court disagree with a judgment of three learned judges and refer the matter directly to a Bench of five judgesRs.
2. Interpretation of the provisions of article 145 of the Constitution of India regarding the minimum number of judges required for deciding cases involving substantial questions of law.
3. Judicial discipline and propriety in following precedent judgments of higher Benches.

Analysis:

Issue 1:
The central issue in this case is whether two learned judges of the court can disagree with a judgment of three learned judges and refer the matter directly to a Bench of five judges. The Supreme Court examined the precedent set in Bharat Petroleum Corporation Ltd. v. Mumbai Shramik Sangha, where it was established that the decision of a higher Bench binds a lower Bench. The Court emphasized the importance of judicial discipline and propriety, stating that a Bench of two learned judges should follow a decision of a Bench of three learned judges. However, if the Bench of two learned judges believes that the earlier judgment is fundamentally incorrect, the appropriate course is to refer the matter to a Bench of three learned judges first, setting out reasons for disagreement. Only if the Bench of three learned judges also finds the earlier judgment incorrect can the matter be referred to a Bench of five learned judges.

Issue 2:
The Court delved into the interpretation of the provisions of article 145 of the Constitution of India, specifically clauses (2) and (3), which deal with the minimum number of judges required for deciding cases involving substantial questions of law. It was highlighted that clause (2) empowers the making of rules to fix the minimum number of judges, while clause (3) mandates that the minimum number of judges for cases involving substantial questions of law or constitutional interpretation shall be five. The Court also referred to Order VII rules (1) and (2) of the Supreme Court Rules, 1966, which govern the composition of Benches for hearing cases and the procedure for referring matters to larger Benches.

Issue 3:
The judgment also addressed the principles of judicial discipline and propriety in following precedent judgments. The Court emphasized that a Constitution Bench judgment is binding on smaller Benches, and a judgment of three learned judges is binding on Benches of two learned judges. The learned Attorney-General underscored the importance of adhering to the decisions of higher Benches, citing the Sub-Committee of Judicial Accountability v. Union of India case, which emphasized that no co-ordinate Bench can sit in judgment over the decisions of another. The Court concluded that in this case, the matters should have been referred to a Bench of three learned judges instead of directly to a Bench of five judges, in line with principles of judicial discipline and hierarchy.

In conclusion, the Supreme Court ruled that the matters should have been referred to a Bench of three learned judges, emphasizing the importance of following precedent judgments and maintaining judicial discipline. The Court highlighted the hierarchy of decision-making within the judiciary and the proper procedure for challenging earlier judgments.

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