Issues: (i) Whether Article 11 of the loan agreement, authorising repossession and sale of the hypothecated vehicle, conformed to RBI recovery safeguards and the Indian Contract Act, 1872; (ii) Whether the Company's repossession and sale of the vehicle were unlawful and warranted compensation; and (iii) Whether the writ petition could be dismissed on the ground of delay.

Issue (i): Whether Article 11 of the loan agreement, authorising repossession and sale of the hypothecated vehicle, conformed to RBI recovery safeguards and the Indian Contract Act, 1872.

Analysis: Section 35-A of the Banking Regulation Act, 1949 gives statutory force to RBI directions. The applicable fair-practice framework prohibits harassment and use of force in recovery, requires lawful seizure, and requires a repossession clause to provide adequate notice, a fair procedure for possession, an opportunity to cure default, and a transparent sale process. Article 11 purported to terminate the borrower's rights without notice, authorised entry wherever the vehicle might be located, did not prescribe a possession or sale procedure, and allowed the Company unilaterally to waive notice.

Conclusion: Article 11 does not conform to the RBI safeguards or the requirement of contractual fairness under the Indian Contract Act, 1872, and does not meet the legal standard of a valid repossession clause to that extent.

Issue (ii): Whether the Company's repossession and sale of the vehicle were unlawful and warranted compensation.

Analysis: No seven-day pre-repossession notice was issued, despite such notice being a contractual precondition to repossession. Possession was taken at night by breaking the steering lock and without a memorandum signed by the borrower, contrary to the requirement of peaceful and lawful recovery. The conduct breached the RBI fair-recovery safeguards and arbitrarily deprived the borrower of the vehicle used for livelihood, attracting Articles 14 and 21 of the Constitution of India.

Conclusion: The repossession and consequent sale were unauthorised and arbitrary; the borrower is entitled to restitution and compensation, although the completed sale is not set aside.

Issue (iii): Whether the writ petition could be dismissed on the ground of delay.

Analysis: The borrower promptly reported the incident as theft and pursued remedial proceedings in that bona fide belief. Continuing traffic challans relating to the vehicle after its alleged sale also required explanation. No prejudice from the alleged delay was established.

Conclusion: The writ petition was not liable to be dismissed on the ground of delay.

Final Conclusion: The loan accounts are to be closed, the sale proceeds refunded with interest, and compensation and costs paid to the borrower, while the sale of the vehicle remains undisturbed.

Ratio Decidendi: A financier's contractual right of self-help repossession is enforceable only through a fair and lawful process complying with binding RBI recovery safeguards, including prior notice, an opportunity to cure, peaceful possession, and a transparent sale procedure.

Issues: Whether the direction requiring repayment of the amount released to the complainant under Section 148 of the Negotiable Instruments Act, 1881 was liable to be set aside because it was made by the trial court rather than the appellate court.

Analysis: The proviso to Section 148(3) mandates repayment, with stipulated interest, of an amount released to the complainant where the appellant is acquitted. The complainant had also undertaken before the appellate court to repay the amount subject to disposal of the appeal. Although the refund direction ought ordinarily to have been made by the appellate court, the subsequent deposit of the amount pursuant to court directions and the complainant's failure to comply promptly did not justify interference with the refund direction.

Conclusion: Upon acquittal of the accused, the complainant was bound to repay the released amount, and the refund direction was sustained against the petitioner.

Issues: Whether the appellant, whose writ petition concerning forfeiture of earnest money deposit was relegated to the statutory remedy, should be permitted to approach the Debts Recovery Tribunal notwithstanding the expiry of the ordinary limitation period.

Analysis: Section 17(1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 provides an efficacious remedy before the Debts Recovery Tribunal against measures taken by the secured creditor. Rule 8(7)(f) of the Security Interest (Enforcement) Rules, 2002 requires disclosure of facts necessary for a purchaser to know the nature and value of the property; whether non-disclosure of a subsisting attachment falls within that requirement, and whether it was material to the auction purchaser, are matters for the Tribunal. The appellant had pursued the writ remedy diligently after refusal of refund, the Bank had objected only on the ground of alternative remedy, and the challenge disclosed an arguable case.

Conclusion: The appellant may file an application before the Debts Recovery Tribunal within three weeks, which shall be accepted without requiring an application for condonation of delay; the Tribunal shall decide the matter on merits in accordance with law.

Issues: Whether the power under Section 47-A of the Indian Stamp Act, 1899 can be invoked only upon material indicating wilful undervaluation with fraudulent intent to evade stamp duty; and whether the prior decisions imposing that requirement state the correct law.

Analysis: The competence of the statutory authority to issue a notice was distinguished from the alleged impropriety in setting its jurisdiction in motion. Section 47-A(1), on its plain terms, requires reason to believe that the market value or consideration has not been truly set forth, without expressly requiring proof of a culpable mindset. Importing fraudulent intention as an independent jurisdictional condition was considered inconsistent with literal construction of a taxing statute and capable of defeating a valuation-based enquiry. However, the contrary view had been expressed in binding three-Judge Bench decisions. Judicial discipline therefore required referral rather than departure from that precedent.

Outcome: The questions concerning the correctness of the precedent requiring wilful undervaluation and fraudulent intent were referred for consideration by a larger Bench; no final determination of stamp-duty liability or validity of the notice was made.

Issues: Whether the statutory presumption of a legally enforceable debt arising from an admitted cheque signature stood rebutted, rendering the concurrent conviction for cheque dishonour unsustainable.

Analysis: Sections 118(a) and 139 of the Negotiable Instruments Act, 1881 raise presumptions of consideration and discharge of debt, but those presumptions are rebuttable on a preponderance of probabilities. A probable defence may arise from deficiencies in the complainant's evidence as well as defence evidence. Once the financial capacity to advance the alleged cash loan was specifically challenged, the absence of bank records, receipts, or any financial trail required affirmative proof of capacity and of the underlying transaction. Although a voluntarily delivered signed blank cheque may attract the presumption under Section 139, it does not dispense with proof of a genuine underlying liability after a probable defence is raised. The withholding of a cited eyewitness to the alleged loan and delivery of the cheque warranted an adverse inference under Section 114(g) of the Indian Evidence Act, 1872. The consistent defence evidence, together with these deficiencies, rebutted the presumption; summary answers under Section 313 of the Code of Criminal Procedure, 1973 could not cure the complainant's evidentiary gaps.

Conclusion: The statutory presumption stood rebutted and the alleged legally enforceable debt was not proved; the concurrent findings of conviction were perverse and legally unsustainable.

Issues: (i) Whether the power of the RBI to supersede the BoD of a multi-State co-operative bank under Section 36AAA(1) of the Banking Regulation Act, 1949 is circumscribed by the six-month limit prescribed under Article 243ZL(1) of the Constitution of India; (ii) Whether an order of supersession passed under Section 36AAA(1) of the Banking Regulation Act, 1949 can be extended beyond the term of office for which the BoD of a multi-State co-operative bank had originally been elected.

Issue (i): Whether the power of the RBI to supersede the BoD of a multi-State co-operative bank under Section 36AAA(1) of the Banking Regulation Act, 1949 is circumscribed by the six-month limit prescribed under Article 243ZL(1) of the Constitution of India.

Analysis: Article 243ZL(1) prescribes a general six-month limit for supersession of co-operative boards, but its third proviso provides that the Banking Regulation Act, 1949 shall also apply to co-operative societies carrying on banking business. The expression "shall also apply" incorporates the banking regulatory regime into the constitutional scheme for multi-State co-operative banks and operates as an independent substantive provision. Section 36AAA(1) authorises supersession and extension from time to time up to an aggregate maximum of five years. This construction accords with the specialised regulatory role of the RBI in protecting depositors and preserving banking stability.

Conclusion: The RBI's power under Section 36AAA(1) of the Banking Regulation Act, 1949 is not restricted by the six-month limit in Article 243ZL(1) of the Constitution of India; the issue is decided against the appellants.

Issue (ii): Whether an order of supersession passed under Section 36AAA(1) of the Banking Regulation Act, 1949 can be extended beyond the term of office for which the BoD of a multi-State co-operative bank had originally been elected.

Analysis: Upon supersession, the Board ceases to function and its powers vest in the Administrator. Section 36AAA(1) expressly permits extensions of supersession within the aggregate five-year ceiling, while Section 36AAA(7) requires the Administrator to convene a general meeting for election of new directors on or before expiry of the supersession period specified by the RBI. The tenure of the erstwhile Board does not limit the continuing supersession where the original order was made during its subsisting term.

Conclusion: An order of supersession validly passed under Section 36AAA(1) of the Banking Regulation Act, 1949 may be extended beyond the elected term of the erstwhile Board, subject to the aggregate five-year limit; the issue is decided against the appellants.

Final Conclusion: The Banking Regulation Act, 1949 validly governs the duration and extension of RBI-supervised supersession of the Board of a multi-State co-operative bank, and consultation with a State Government is not required for such a bank.

Ratio Decidendi: The third proviso to Article 243ZL(1) of the Constitution of India incorporates and preserves the Banking Regulation Act, 1949 as the governing regime for supersession of multi-State co-operative banks, including the extended duration permitted by Section 36AAA.

Issues: Whether the appellate pre-deposit requirement under Section 148 of the Negotiable Instruments Act, 1881 applied to a convicted company director who was not the signatory or drawer of the cheque.

Analysis: Section 148 authorises an appellate court to direct a deposit pending an appeal by the drawer against conviction under Section 138. The record showed that another accused was the cheque signatory and drawer on behalf of the company, while the petitioner, arraigned as another director, had not signed the cheque and was not directly implicated by specific allegations in the complaint. The discretionary pre-deposit provision was therefore inapplicable to the petitioner.

Conclusion: The Section 148 pre-deposit condition could not be imposed upon the petitioner, who was not the drawer of the cheque.

Issues: (i) Whether the statutory presumptions arising from admitted execution of the cheque and money receipt were rebutted by the challenge to the complainant's financial capacity and alleged breach of loan-acceptance restrictions; (ii) Whether the conviction was vitiated because a successor Magistrate decided the case on evidence recorded by a predecessor.

Issue (i): Whether the statutory presumptions arising from admitted execution of the cheque and money receipt were rebutted by the challenge to the complainant's financial capacity and alleged breach of loan-acceptance restrictions.

Analysis: Admission of the petitioner's signatures on the cheque and money receipt attracted the presumptions under Sections 118 and 139 of the Negotiable Instruments Act. The challenge based on the complainant's financial capacity and the alleged violation of Section 269SS of the Income-tax Act did not displace those presumptions, as no cogent and reliable rebuttal evidence was produced.

Conclusion: The statutory presumptions remained unrebutted; the issue is decided against the petitioner.

Issue (ii): Whether the conviction was vitiated because a successor Magistrate decided the case on evidence recorded by a predecessor.

Analysis: The trial record showed that the proceeding was conducted as a summons trial and not as a summary trial. Consequently, the restriction invoked under Section 326(3) of the Code of Criminal Procedure, 1973 did not establish prejudice or illegality.

Conclusion: The conviction was not vitiated on account of the successor Magistrate deciding the case; the issue is decided against the petitioner.

Final Conclusion: The concurrent findings of guilt under Section 138 of the Negotiable Instruments Act disclose no perversity, material illegality, impropriety, or jurisdictional error warranting revisional interference.

Ratio Decidendi: Once execution of a cheque is admitted, the statutory presumptions of consideration and legally enforceable liability operate unless rebutted by cogent and reliable evidence; an unsubstantiated challenge to the payee's financial capacity does not suffice.

Issues: (i) Applicable Guidelines and sanction of professional fees exceeding prescribed ceilings for distinct valuation assignments; (ii) Entitlement to interest on delayed professional fees and inflation-linked enhancement; (iii) Source of recovery of the sanctioned fees and personal liability of third parties; (iv) Discharge of the Court Receiver and closure of the suit account.

Issue (i): Applicable Guidelines and sanction of professional fees exceeding prescribed ceilings for distinct valuation assignments.

Analysis: The assignment, undertaken in 2004, concerned inspection and valuation of immovable properties for their proposed sale. It was consequently governed by the Guidelines dated 1 February 1994, rather than the 1999 Guidelines relating to royalty or compensation or the subsequently issued 2007 Guidelines. Clause 9 required prior sanction before payment of fees exceeding the prescribed ceiling, not before appointment of the Valuer. The ceiling was ordinarily applicable separately to each distinct valuation exercise. The reports were accepted, the work was neither disputed nor found deficient, and the prolonged non-payment was not attributable to the Valuer.

Conclusion: The revised professional fees of Rs. 6,51,062 were sanctioned in full, including fees exceeding the ordinary ceilings and the higher charge for inspection and the status report.

Issue (ii): Entitlement to interest on delayed professional fees and inflation-linked enhancement.

Analysis: Although the 1994 Guidelines did not expressly provide for interest, reasonable compensation for deprivation of legitimately earned fees could be awarded in exceptional circumstances. Interest compensated for the time value of money during the delay. Granting a further inflation-linked multiplier, particularly on both principal and interest, would amount to double compensation for the same delay period.

Conclusion: The Valuer was entitled to interest of Rs. 8,20,338 up to May 2025 and further simple interest at 6% per annum on Rs. 6,51,062 from 1 June 2025 until payment; the inflation-linked enhancement claim was rejected.

Issue (iii): Source of recovery of the sanctioned fees and personal liability of third parties.

Analysis: Clause 8 of the 1994 Guidelines confined the Valuer's recourse to funds available in the concerned proceedings or with the appropriate insolvency authority. No fund or asset under the Court Receiver's control was available, and payment could not be ordered from the Receiver's general account or public funds. No substantive material established personal liability of an individual associated with the company or liability of separate corporate entities; mere association could not displace separate corporate personality.

Conclusion: The Valuer may lodge the sanctioned claim before the competent Official Liquidator, with the Court Receiver required to forward the relevant material; relief seeking personal liability and freezing of third-party corporate assets was rejected.

Issue (iv): Discharge of the Court Receiver and closure of the suit account.

Analysis: The Court Receiver had substantially completed the assigned functions, the underlying writ proceedings had ended, no funds remained in the suit account, and no further recovery action by the Receiver was warranted after the Valuer was permitted to pursue its claim in liquidation.

Conclusion: The Court Receiver was discharged without passing accounts, and the suit account was permitted to be closed without further costs, charges or expenses.

Final Conclusion: The Valuer's determined dues are enforceable only through the appropriate liquidation process, while no personal or public-fund liability arises merely from the Court-authorised engagement.

Ratio Decidendi: A Court-appointed Valuer may receive post facto sanction for reasonable fees exceeding guideline ceilings where the accepted work was properly performed, but interest for delayed payment precludes overlapping inflation-based compensation for the same period.

Issues: Whether an SEZ unit was entitled to exemption and refund of stamp duty and registration fee on a lease deed executed before promulgation of the Gujarat Special Economic Zone Ordinance, 2004, where the State's SEZ policy had already promised those fiscal benefits.

Analysis: The State policy dated 19.07.2002 extended complete exemption from stamp duty and registration fee to SEZ units and induced investment for industrial development. The Ordinance promulgated on 10.02.2004 gave formal statutory shape to that pre-existing policy. Denial of the promised fiscal benefit solely because the lease deed pre-dated the Ordinance would defeat the policy's object and differentiate without justification between similarly placed SEZ units based only on the date of execution. A lease transfers an interest in land and falls within the policy's intended fiscal benefit.

Conclusion: The exemption and consequential refund of stamp duty and registration fee were rightly available to the SEZ unit notwithstanding that the lease deed was executed before 10.02.2004.

Issues: (i) Whether proceedings for cheque dishonour could continue against a person described as a Joint Managing Director where uncontroverted corporate records established that he was never a director or officer of the accused company and the complaint disclosed no independent role; (ii) Whether corporate complainants in future complaints under Sections 138 and 141 of the Negotiable Instruments Act, 1881 must furnish documents verifying the accused company and the status of persons sought to be made vicariously liable.

Issue (i): Whether proceedings for cheque dishonour could continue against a person described as a Joint Managing Director where uncontroverted corporate records established that he was never a director or officer of the accused company and the complaint disclosed no independent role.

Analysis: Section 141 of the Negotiable Instruments Act, 1881 imposes vicarious criminal liability only on persons who were in charge of and responsible for the company's business at the relevant time, or whose consent, connivance, or negligence in relation to the dishonoured cheque is specifically disclosed. A Managing Director or Joint Managing Director may be proceeded against by virtue of that office, but the premise fails where reliable corporate records establish that the person never held such office in the accused company. Inherent jurisdiction under Section 482 of the Code of Criminal Procedure, 1973 may be exercised on unimpeachable evidence beyond doubt where continuation of prosecution would amount to abuse of process. The Ministry of Corporate Affairs records showed that the person was never a director of the accused company; this remained uncontroverted, and neither the complaint nor the material before the Court attributed any actual role in its business or in issuance and dishonour of the cheque.

Conclusion: The complaint and consequential proceedings were unsustainable against the petitioner and were quashed only as against him.

Issue (ii): Whether corporate complainants in future complaints under Sections 138 and 141 of the Negotiable Instruments Act, 1881 must furnish documents verifying the accused company and the status of persons sought to be made vicariously liable.

Analysis: Incorrect impleadment of persons who were not directors, authorised signatories, or otherwise responsible for the company's affairs causes avoidable harassment and delay. Verification of the company's corporate identity and of the office held by each proposed accused at the relevant time is necessary before criminal process is initiated against persons on a vicarious-liability basis.

Conclusion: Prospectively, every complaint against a corporate accused must annex the company's Corporate Identification Number obtained from Ministry of Corporate Affairs master data and a certified copy of Form DIR-12; registration without these documents is permissible only where their non-availability despite due diligence is specifically affirmed and reasons are recorded before cognizance.

Final Conclusion: Vicarious liability for a corporate cheque-dishonour offence cannot rest on an incorrect designation where incontrovertible corporate material negates the person's connection with the accused company, and future corporate complaints must be supported by verification of corporate status and responsible officers.

Ratio Decidendi: In proceedings under Section 141 of the Negotiable Instruments Act, 1881, uncontroverted corporate records demonstrating that a person never held office in, or responsibility for, the accused company justify quashing under Section 482 of the Code of Criminal Procedure, 1973 where the complaint contains no independent factual basis for liability.

Issues: Whether a bank governed by the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 can invoke that Act to recover a secured loan acquired from a non-banking financial company which was not a notified financial institution when the loan was originated.

Analysis: The statutory scheme enables banks and financial institutions to enforce security interests for recovery of live and owing debts. The definitions of borrower, security arrangement, security interest and secured creditor, construed purposively, apply to existing loan agreements irrespective of whether the original lender was a notified financial institution when the loan was advanced. The principles applicable where an originally non-covered lender subsequently becomes covered by the Act, or where its debt passes to a covered successor-in-interest, equally apply where a bank already covered by the Act acquires the secured debt. Assignment to such bank immediately gives the acquired loan the attributes of a secured debt for purposes of enforcement under the Act.

Conclusion: A bank may invoke the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 to enforce security interests securing a debt acquired from a non-notified non-banking financial company. The unadjudicated objections in the concerned securitisation application remain open for determination on their merits.

Issues: (i) Whether purse-seine vessels may transit State territorial waters to fish in the EEZ under the distinct Union and State regulatory regimes; (ii) Whether pending applications for EEZ Access Passes may be left unprocessed by the State verifying authority.

Issue (i): Whether purse-seine vessels may transit State territorial waters to fish in the EEZ under the distinct Union and State regulatory regimes.

Analysis: Fishing in the EEZ falls within the Union's legislative and executive sphere, whereas fishing in territorial waters is regulated by the State. The EEZ Rules, 2025 provide for Access Passes for EEZ fishing, while the Tamil Nadu Marine Fishing Regulation Rules, 2020 regulate activity within territorial waters. These autonomous regulatory fields do not conflict. Cooperative federalism requires implementation that enables regulated access to the EEZ while preserving the State's power to regulate transit and fishing within territorial waters. The State must designate transit channels under Rules 15(5) and 15(6), with due regard to the Expert Committee's recommendations.

Conclusion: Purse-seine vessels possessing the requisite EEZ permissions may obtain regulated transit access through Tamil Nadu's territorial waters to fish in the EEZ; the State must frame rules or regulations for specified transit channels. This is in favour of the applicants.

Issue (ii): Whether pending applications for EEZ Access Passes may be left unprocessed by the State verifying authority.

Analysis: The Access Pass framework requires coordination between the Union issuing authority and the State verifying authority. Prolonged non-verification of applications defeats the regulatory scheme and, in practical effect, creates an impermissible unwritten prohibition on the pursuit of the applicants' occupation, subject to lawful regulation.

Conclusion: The State must ensure effective, efficient and timely verification and clearance of applications in accordance with the governing rules and regulations. This is in favour of the applicants.

Final Conclusion: The governing Union and State regimes must operate harmoniously to secure lawful, regulated EEZ fishing access and timely regulatory clearances.

Ratio Decidendi: Where Union law regulates fishing in the EEZ and State law regulates territorial waters, their distinct constitutional fields must be implemented cooperatively, and administrative delay cannot operate as an unwritten bar to regulated access.

Issues: Whether an MSME borrower that did not invoke the revival and rehabilitation framework in response to the demand notice or in an earlier writ petition could subsequently challenge the SARFAESI measures and auction notice on that ground despite the statutory remedy before the Debt Recovery Tribunal.

Analysis: The MSME framework requires an eligible stressed enterprise to seek a corrective plan or rehabilitation. A borrower may assert MSME status in its response to a notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, whereupon the secured creditor must examine the claim and keep further measures in abeyance if the claim warrants acceptance. No such claim or rehabilitation application was made when the demand notice was issued, and the earlier writ petition challenging the consequential recovery measures did not raise the protection under the framework. The auction notice was consequential to the earlier SARFAESI measures, and no independent procedural illegality in the auction was established. The Henderson Principle, constructive res judicata and Order II Rule 2 of the Code of Civil Procedure bar a litigant from reopening a dispute by raising grounds that could and ought to have been raised in the first proceeding. The statutory remedy under Section 17 remained available before the Debt Recovery Tribunal.

Conclusion: The belated claim for protection under the MSME framework could not be raised to reopen the SARFAESI proceedings or challenge the consequential auction notice; no exercise of writ jurisdiction was warranted.

Issues: (i) Whether codeine-based cough syrup within the quantitative limits in Entry 35 of the notification dated 14.11.1985 attracts the NDPS Act when dealt with by a drug licence holder for medicinal use; (ii) Whether such cough syrup attracts the NDPS Act when stocked, sold or transported for intoxication or another non-medicinal purpose; (iii) Whether the respective applicants were entitled to bail on the material attributed to them.

Issue (i): Whether codeine-based cough syrup within the quantitative limits in Entry 35 of the notification dated 14.11.1985 attracts the NDPS Act when dealt with by a drug licence holder for medicinal use.

Analysis: Codeine is an opium derivative and ordinarily a manufactured drug, but Entry 35 excludes a preparation compounded with other ingredients, containing no more than 100 mg per dosage unit and no more than 2.5% concentration, which has been established in therapeutic practice. The expression concerns the established therapeutic character of the preparation, not the end-user's individual use. A codeine cough syrup satisfying these conditions and dealt with in the ordinary medicinal trade by a valid licence holder is outside the category of manufactured drug. A routine retail sale without a prescription may breach the Drugs and Cosmetics regulatory regime, but does not by itself invoke the NDPS Act absent material indicating knowledge of diversion to non-medicinal use.

Conclusion: A qualifying codeine-based cough syrup sold, stocked or transported by a licence holder for medicinal use is not a narcotic substance under the NDPS Act.

Issue (ii): Whether such cough syrup attracts the NDPS Act when stocked, sold or transported for intoxication or another non-medicinal purpose.

Analysis: The statutory exception is available only where the preparation is genuinely dealt with for medical or scientific purposes and consistently with the applicable licensing requirements. The NDPS Act operates in addition to the Drugs and Cosmetics Act; a licence does not protect dealings involving deliberate diversion of a codeine preparation for intoxication. Large-scale diversion, fictitious documentation or entities, absence of actual delivery or stock, forged transport records, and other material indicating non-medicinal trafficking may establish that the exemption is unavailable. Where the NDPS Act applies, the weight of the entire syrup mixture is considered in determining small or commercial quantity.

Conclusion: A qualifying codeine cough syrup knowingly stored, sold or transported for intoxication or another non-medicinal purpose is treated as a codeine preparation and manufactured drug attracting the NDPS Act.

Issue (iii): Whether the respective applicants were entitled to bail on the material attributed to them.

Analysis: Bail was assessed individually without deciding guilt. Bail was justified where the material did not prima facie establish conscious possession, knowledge of concealed contents, actual involvement in diversion, or participation in a trafficking conspiracy beyond unsupported confessional statements or weak circumstantial material. Bail was refused where the record prima facie disclosed organised diversion of very large quantities through fictitious firms, false invoices or transport records, unexplained financial routing, forged documentation, or other evidence of intended non-medicinal distribution.

Conclusion: Bail was granted to applicants against whom prima facie material of conscious involvement in non-medicinal trafficking was insufficient, and refused to applicants against whom such material was prima facie established.

Final Conclusion: The statutory exemption protects genuine medicinal dealings in qualifying codeine cough syrup, but cannot be used to shield its knowing diversion for intoxication; the individual applications were resolved according to the strength of the respective prima facie material.

Ratio Decidendi: A codeine preparation within Entry 35 remains outside the NDPS Act only while it is genuinely dealt with for medical or scientific purposes in accordance with the governing regulatory requirements; knowing diversion for intoxication defeats the exemption.

Issues: (i) Whether delayed deposit of Foreign Travel Tax before issuance of a show-cause notice constitutes failure to pay tax attracting penalty under Section 38(3) of the Finance Act, 1979, and whether penalty is automatic; (ii) Whether penalty could be substantially enhanced upon de novo adjudication following the assessee's appeal.

Issue (i): Whether delayed deposit of Foreign Travel Tax before issuance of a show-cause notice constitutes failure to pay tax attracting penalty under Section 38(3) of the Finance Act, 1979, and whether penalty is automatic.

Analysis: Section 38(3) applies where a carrier fails to pay, namely does not pay, Foreign Travel Tax to the credit of the Central Government. In a fiscal provision, the expression cannot be expanded to equate delayed payment with non-payment. Payment made before issuance of a show-cause notice is delayed payment, whereas payment after such notice remains non-payment. Delayed deposit and delayed filing of returns fall within Section 38(4), read with Rules 4 and 9 of the Foreign Travel Tax Rules, 1979. The Collector of Customs may condone delay upon sufficient cause under those Rules.

Analysis: The show-cause, representation and hearing process under Rule 12 preserves adjudicatory discretion. The presence of the word "shall" and a prescribed minimum quantum do not make levy of penalty automatic; the authority may decline penalty where the explanation and circumstances show that it is unwarranted. The brief delays caused despite timely procurement of demand drafts, and the explained longer delay, did not justify penalty.

Conclusion: Delayed payment did not attract Section 38(3), and penalty was not imposable on the assessee on the facts of the case. This issue is decided in favour of the assessee.

Issue (ii): Whether penalty could be substantially enhanced upon de novo adjudication following the assessee's appeal.

Analysis: The principle of no reformatio in peius forms part of fair procedure, natural justice and equity. Resort to an appellate remedy cannot aggravate the appellant's position. Enhancement of the penalty from the originally imposed amount to a substantially higher amount on remand, solely after the assessee invoked the appellate process, impermissibly placed the assessee in a worse position.

Conclusion: The enhanced penalty could not be sustained because the assessee could not be made worse off for having pursued its appeal. This issue is decided in favour of the assessee.

Final Conclusion: The penalty for the six instances of delayed Foreign Travel Tax deposit was invalid; the penalty orders and consequential demands were nullified, with refund of amounts paid towards penalty and discharge of the bank guarantee.

Ratio Decidendi: In a fiscal penalty provision, delayed payment made before issuance of a show-cause notice cannot be equated with failure to pay, and a statutory adjudicatory process requiring notice and hearing preserves discretion not to impose penalty notwithstanding a prescribed minimum quantum.

Issues: Whether a contractual claim for recovery of GST amounts paid to a service provider, following reversal of input tax credit, is ex facie non-arbitrable at the stage of appointment of an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996.

Analysis: At the Section 11 stage, the enquiry is confined to the prima facie existence of an arbitration agreement. The admitted arbitration clause covered disputes arising under the contractual engagement. A claim concerning reimbursement or the ultimate inter se incidence of an indirect-tax amount paid under a contract is a dispute in personam between the contracting parties; it neither determines tax liability vis-a -vis the revenue nor intrudes upon the State's sovereign taxing functions. Objections concerning jurisdiction and arbitrability remain available before the arbitral tribunal under Section 16 of the Arbitration and Conciliation Act, 1996.

Conclusion: The reimbursement claim was not manifestly non-arbitrable, and a sole arbitrator was appointed, with objections on jurisdiction and arbitrability reserved for determination by the arbitral tribunal.

Issues: Whether dishonour of a cheque drawn on a bank that had merged with another bank, where the cheque was presented after expiry of the validity period prescribed for legacy cheques, attracts liability under Section 138 of the Negotiable Instruments Act, 1881.

Analysis: Proviso (a) to Section 138 requires presentation of a cheque within its period of validity. Following the merger of Syndicate Bank with Canara Bank, legacy Syndicate Bank cheques could be presented only until 30 June 2021, after which the old banking codes were permanently disabled. The cheque was presented in 2025, long after that deadline, and was therefore invalid on the date of presentation. Continuation of a prosecution founded on such an invalid instrument would amount to abuse of process of law.

Conclusion: Dishonour of the invalid cheque did not attract criminal liability under Section 138 of the Negotiable Instruments Act, 1881.

Issues: Whether the complaints contained sufficient averments to fasten vicarious liability on the petitioner under Section 141 of the Negotiable Instruments Act, 1881 for dishonour of cheques under Section 138.

Analysis: Liability of a company director for an offence by the company requires averments that, at the time of the offence, the director was both in charge of and responsible for the conduct of the company's business, or that the offence occurred through the director's consent, connivance or neglect. Directorship alone does not create deemed criminal liability. The petitioner was neither a party to the underlying agreement nor a signatory to the cheques, and the complaints contained only general allegations against all accused without material particulars of the petitioner's role in the company's day-to-day affairs or in the cheque transactions. The process-issuing orders also did not address the statutory requirements for vicarious liability.

Conclusion: The petitioner could not be prosecuted under Sections 138 and 141 of the Negotiable Instruments Act, 1881 on the basis of the deficient complaints; the issue is decided in favour of the petitioner.