2026 (2) TMI 303 - HC - Benami Property

Explanation to Order 47 Rule 1 CPC and condonation of delay: review limited where later superiorcourt decisions resolve conflicting benches, appeal allowed

The issue concerns limits on review jurisdiction under the Explanation to Order 47 Rule 1 CPC and whether condonation of delay can rest solely on a ... Explanation to Order 47 Rule 1 of the Code of Civil Procedure, 1908 - Review jurisdiction and condonation of delay - Binding effect of earlier coordinate and larger Bench decisions - Prospective application of substantive amendments to penal/confiscatory provisions - Whether the Appellate Tribunal lawfully allowed the review petition and condoned delay solely on the basis of the liberty granted by the Supreme Court without determining whether the bar contained in the Explanation to Order 47 Rule 1 CPC applied. - HELD THAT:- As can be seen from the order dated 19.10.2024 passed in the review petition in Union of India & Another vs. Ganpati Dealcom Private Limited, [2024 (10) TMI 1120 - SC ORDER (LB)], the Union of India (respondent) have been granted the liberty to seek a review of the order dated 07.12.2022 passed by the learned Appellate Tribunal. However, in the case of K.L. Rathi Steels Limited [2024 (7) TMI 811 - SUPREME COURT] the Supreme Court while considering it’s other judgments, such as Subramanian Swamy vs. State of T.N [2014 (1) TMI 1710 - SUPREME COURT] and Beghar Foundation vs. K.S. Puttaswami [2021 (2) TMI 504 - SUPREME COURT] – has held that in terms of the Explanation to Order 47 Rule 1 CPC, if the decision on a question of law on which the judgment of the Court is based, is subsequently reversed or modified by a subsequent decision of a Superior Court in any other case, it shall not be a ground for review of such judgment. Even an erroneous decision cannot be a ground for a Court to undertake a review and that change in the law or subsequent decision/judgment of a coordinate Bench or a larger Bench by itself, cannot be a ground for review. As can be seen from the facts, the Hon’ble Supreme Court in the case of Kokilaben Chhaganbhai Patel [2025 (5) TMI 1634 - SC ORDER] has already taken a decision with regard to which of the three Judges Benches decision of the Hon’ble Supreme Court should be followed. It has already decided that the earlier three Judges Bench in the case of K.L. Rathi Steels Limited [2024 (7) TMI 811 - SUPREME COURT] would have to be followed and the observation/direction passed in paragraph-7 of the review petition in Union of India & Another vs. Ganpati Dealcom Private Limited cannot be followed, as the same was apparently per incuriam. When the Hon’ble Supreme Court in the case of Kokilaben Chhaganbhai Patel has already decided as to which decision of the conflicting 3 Judges Bench is to be followed, we are bound to follow the above interpretation given by the Hon’ble Supreme Court. Further, in the case of National Insurance Company Limited vs. Pranay Sethi & Others, [2017 (10) TMI 1276 - SUPREME COURT], the Hon’ble Supreme Court has held that when there are conflicting decisions of equal Benches of the Supreme Court, the earlier decision would have to be followed by the High Court. The common order dated 13.10.2025 of the Appellate Tribunal allowing the review petitions and restoring the appeals is set aside; the appeal is allowed. Issues: (i) Whether the Appellate Tribunal acted legally in allowing review petitions relying on the liberty granted by the Supreme Court without examining applicability of Order 47 CPC and Section 114 CPC read with Section 40(2)(f) PBPT Act; (ii) Whether the impugned order allowing review is barred by the Explanation to Rule 1 of Order 47 CPC.Issue (i): Whether the Appellate Tribunal acted legally in allowing the review petitions on the basis of the liberty granted by the Supreme Court without examining whether such liberty could override statutory limitations under Section 114 read with Order 47 CPC and Section 40(2)(f) PBPT Act.Analysis: The issue requires assessment of whether a tribunal may reopen its earlier order solely because a higher court granted liberty to seek review in a separate matter, without determining applicability of the statutory scheme governing review (Order 47 CPC and Section 114 CPC) and the specific bar in Section 40(2)(f) PBPT Act. Relevant authorities establish that a change in law or subsequent decision of another Bench does not automatically permit review; the statutory test for review must be satisfied and the Explanation to Order 47 Rule 1 CPC restricts review on the ground of a subsequent contrary decision of a superior court unless the statutory criteria for review are met.Conclusion: The Appellate Tribunal could not properly allow the review petitions solely on the basis of the liberty granted by the Supreme Court without determining whether the statutory provisions governing review applied.Issue (ii): Whether the impugned order allowing the review application is in the teeth of the express bar set forth in the Explanation to Rule 1 of Order 47 CPC.Analysis: The question focuses on the scope of the Explanation to Rule 1 of Order 47 CPC which precludes review merely because a decision on which the judgment was based has been reversed or modified by a subsequent decision of a superior court in another case. Binding decisions indicate that change in law or a subsequent contrary decision by a coordinate or larger Bench, by itself, is not a ground for review; the Explanation limits review to errors apparent on the face of the record or similar statutory grounds.Conclusion: The impugned order allowing review is contrary to the Explanation to Rule 1 of Order 47 CPC in that the review was allowed without application of the statutory review test; accordingly the impugned order is set aside.Final Conclusion: The impugned common order dated 13.10.2025 of the Appellate Tribunal is set aside and the appeal is allowed, restoring finality to the Tribunal's earlier order until such time as statutory grounds for review are properly established.Ratio Decidendi: A tribunal cannot permit review of its final order merely because a higher court in another matter granted liberty to seek review; the statutory test for review under Order 47 Rule 1 CPC (and related provisions) must be applied, and the Explanation to Rule 1 bars review based solely on a subsequent contrary decision of a superior court.