2025 (8) TMI 1305 - SC - Companies Law

Section 362 CrPC bars review or recall of criminal judgments except clerical or arithmetical correction; Order XLVII CPC inapplicable

VIKRAM BAKSHI AND OTHERS Versus R.P. KHOSLA AND ANOTHER

VIKRAM BAKSHI AND OTHERS Versus R.P. KHOSLA AND ANOTHER - 2025 INSC 1020 ISSUES PRESENTED AND CONSIDERED 1. Whether a court exercising criminal jurisdiction under Section 340 CrPC can have its final order reviewed, recalled or altered by the same court in absence of statutory provision permitting review, having regard to Section 362 CrPC. 2. Whether proceedings under Section 340 CrPC are criminal in nature so as to attract the exclusive procedural code and bar invocation of civil review remedies (Order XLVII CPC) or other non-CrPC procedural provisions. 3. Whether a recall of a criminal court's order is permissible as a 'procedural review' (recall simpliciter) in circumstances of factual non-disclosure or mistake, and if so, whether the High Court's recall in the present case fell within those limited exceptions. 4. Whether the facts relied upon to recall the High Court's earlier order (in particular, alleged withdrawal of the related company petition) constituted a ground that was not available or could not have been raised at the time of the original decision, thereby justifying recall under recognised exceptions to Section 362 CrPC. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Power to review/alter final criminal orders: legal framework Legal framework: Section 362 CrPC provides that, save as otherwise provided by the Code or any other law, no court after signing its judgment or final order shall alter or review it except to correct clerical or arithmetical errors. The CrPC is a self-contained procedural code for offences under the IPC (Section 4 CrPC). Precedent Treatment: The Court follows and applies prior decisions holding that Section 362 constitutes a complete prohibition on review/alteration by criminal courts (three-Judge bench authority and subsequent rulings), and reiterates that courts become functus officio on signing judgment. Decisions distinguishing procedural from substantive review were acknowledged. Interpretation and reasoning: The Court affirms that the bar in Section 362 is to be applied strictly: absent express statutory power or a provision in another law, final criminal orders cannot be altered except for clerical/arithmetic corrections. Attempts to circumvent Section 362 via civil review provisions or by invoking inherent powers are impermissible. Ratio vs. Obiter: Ratio - Section 362 bars review/alteration of criminal court judgments except as permitted by statute or for clerical/arithmetic errors; criminal courts are functus officio once judgment is signed. Observational - references to comparative civil review powers and policy considerations. Conclusion: The criminal court lacks general power to review/alter its final orders; Section 362's bar is operative unless a recognised exception or statutory grant applies. Issue 2 - Nature of Section 340 CrPC proceedings and exclusivity of CrPC procedure Legal framework: Section 340 CrPC authorises a court to hold a preliminary inquiry to determine whether a complaint should be forwarded for prosecution for offences in relation to judicial proceedings; Section 4(1) mandates that offences under the IPC be dealt with according to CrPC procedure. Precedent Treatment: The Court treats Section 340 proceedings as criminal in nature consistent with earlier authorities characterising such inquiries as initial steps that may lead to criminal prosecution. Interpretation and reasoning: Because a Section 340 inquiry may culminate in a criminal prosecution and potential punishment under the penal law, it is, in substance, a criminal proceeding governed by CrPC. Consequently, procedural rules under civil codes (e.g., Order XLVII CPC) are not available to alter or review a decision in such criminal proceedings unless expressly permitted. Ratio vs. Obiter: Ratio - Proceedings under Section 340 are criminal in nature and therefore governed exclusively by CrPC procedural rules; civil review mechanisms are not available to alter criminal court orders in Section 340 matters. Observational - explanation of the substantive/consequential character of 'criminal nature.' Conclusion: Section 340 proceedings attract the CrPC regime; reliance on civil review provisions to recall a criminal order was impermissible. Issue 3 - Scope and limits of 'procedural review'/recall by criminal courts Legal framework: Jurisprudence recognises narrow exceptions permitting recall where courts correct a palpably erroneous order passed under misapprehension ('procedural review') distinct from substantive review (on merits), which Section 362 bars. Precedent Treatment: The Court follows and synthesises authorities distinguishing procedural and substantive review and listing limited grounds for recall: lack of inherent jurisdiction, fraud/collusion, mistake causing prejudice, non-service or death of a necessary party, or when statutory power elsewhere permits recall. Interpretation and reasoning: The Court enumerates and reiterates limits: exceptions allow recall only where the ground was not available or could not have been raised in original proceedings; they are not a means to reopen merits or to remedy deliberate omissions. Procedural review is confined to correcting court's own palpable errors of fact or procedure made without knowledge of material facts and not to effect substantive re-adjudication. Ratio vs. Obiter: Ratio - Procedural recall is limited to narrowly defined grounds; substantive re-examination is barred. Observational - doctrinal clarification on permissible scope and policy against undermining finality. Conclusion: Procedural recall is available but strictly confined to limited circumstances; absent those, recall constitutes impermissible substantive review. Issue 4 - Application of law to facts: whether High Court's recall was justified Legal framework & Precedent Treatment: Applying Section 362, the exclusivity of CrPC, and the narrow exceptions for recall reviewed above. Interpretation and reasoning: The High Court entertained a review under Order XLVII CPC in proceedings under Section 340 CrPC - a civil procedural remedy not available in criminal proceedings - and proceeded to recall its earlier order on the asserted ground that the related company petition had been withdrawn. The Court finds that withdrawal had occurred before the original hearing and was therefore a fact available and raisable at the time; it was not a new or previously unavailable ground. The High Court itself recognised that review under CrPC is ordinarily not maintainable yet proceeded to recall, invoking a 'procedural review' rationale. The present circumstances did not satisfy the limited exceptions: there was no lack of jurisdiction, no fraud on court by the opposing party shown, no non-service or death of a party, and the ground relied upon was not newly discovered or unavailable during original proceedings. The recall thus operated as a substantive re-opening of the criminal proceeding, circumventing Section 362 and the binding direction that related issues be adjudicated by the company forum. Ratio vs. Obiter: Ratio - The High Court's recall was impermissible because the ground for recall was available at the time of the original order and did not fall within the narrow exceptions that permit procedural recall; civil review under Order XLVII CPC cannot be invoked to recall/alter a criminal court's final order. Observational - reinforcement of the principle against abuse of process and the necessity of respecting finality in criminal adjudication. Conclusion: The High Court's Impugned Order constituted an impermissible review/recall of a criminal order in breach of Section 362 CrPC and was set aside; the earlier order remains undisturbed and the appeal is allowed.