This judgment addresses a crucial point of law regarding the power of criminal courts to review or recall their own orders, particularly concerning proceedings initiated for perjury. The Supreme Court of India examined whether the Delhi High Court’s decision to recall its earlier judgment, which had dismissed an application for perjury prosecution, was legally permissible.
The Dispute’s Genesis: The case originates from a dispute between the Khosla Group and the Bakshi Group concerning the development of a resort in Kasauli, Himachal Pradesh. A Memorandum of Understanding (MoU) was signed on December 21, 2005, followed by an Agreement on March 31, 2006, which transferred 51% shareholding in Montreaux Resorts Private Limited (MRPL) to Mr. Vikram Bakshi.
Allegations of Oppression and Mismanagement: Ms. Sonia Khosla of the Khosla Group filed Company Petition No. 114 of 2007 (CP 114 of 2007) before the Company Law Board (CLB), alleging oppression and mismanagement, including an illegal reduction of her shareholding in MRPL and seeking removal of Bakshi Group directors.
The Perjury Claim: The litigation took a significant turn when the Bakshi Group filed an application asserting that Mr. Vinod Surha and Mr. Wadia Prakash were confirmed as Directors of MRPL as per the minutes of an Annual General Meeting (AGM) held on September 30, 2006. Ms. Sonia Khosla alleged these minutes were forged and filed an application under Section 340 of the Criminal Procedure Code, 1973 (CrPC) before the CLB, seeking prosecution of the Bakshi Group for perjury.
Supreme Court’s 2014 Directive: Ms. Sonia Khosla also moved the High Court with a similar application (Criminal Miscellaneous (Co.) No. 3 of 2008). The Supreme Court, in its judgment dated May 8, 2014, in SLP (Criminal) No. 6873 of 2010, passed a consent order directing the CLB to decide CP 114 of 2007, which would also address the genuineness of the AGM minutes and the Section 340 CrPC application. Crucially, the High Court was directed not to proceed further with Ms. Sonia Khosla’s Section 340 CrPC application.
High Court’s Initial Judgment (August 13, 2020): Subsequently, the Khosla Group filed another application, Criminal Miscellaneous (Co.) No. 4 of 2019, under Section 340 CrPC before the High Court, alleging false statements in a counter-affidavit by the Bakshi Group. The High Court, referencing the Supreme Court’s 2014 order and noting that the National Company Law Tribunal (NCLT, successor to CLB) was seized of CP 114 of 2007, declined to interfere in the matter.
The Impugned Recall Order (May 5, 2021): The Khosla Group then filed a review application under Order XLVII of the Code of Civil Procedure, 1908 (CPC), seeking to recall the High Court’s August 13, 2020 judgment. They contended that CP 114 of 2007 had been withdrawn on February 7, 2020 (before the High Court’s judgment) and this fact was not brought to the court’s notice. Despite acknowledging that a review petition generally does not lie under the CrPC, the High Court proceeded to recall its judgment dated August 13, 2020, on the ground that the withdrawal of the Company Petition was not brought to its notice earlier, and directed Criminal Miscellaneous (Co.) No. 4 of 2019 to be listed for hearing. This recall order is the subject of the current appeal before the Supreme Court.
Law Involved
The core legal provisions and principles examined by the Supreme Court include:
Section 362 of the Criminal Procedure Code, 1973 (CrPC): This section explicitly prohibits a criminal court from altering or reviewing its judgment or final order once signed, except to correct a clerical or arithmetical error.
Section 340 of CrPC: This section outlines the procedure for initiating prosecution for perjury and other offenses affecting the administration of justice, involving a preliminary inquiry by the court.
Section 4 of CrPC: Defines the scope of the CrPC, mandating that all offenses under the Indian Penal Code and other laws be investigated, inquired into, tried, and dealt with according to its provisions.
Order XLVII of the Code of Civil Procedure, 1908 (CPC): Governs review petitions in civil proceedings.
Judicial Precedents on Review Power:
The Supreme Court has consistently held that Section 362 CrPC imposes an absolute embargo on criminal courts reviewing their own judgments.
“Procedural Review” vs. “Substantive Review”: While “substantive review” on merits is generally barred unless specifically provided by statute, a “procedural review” is an inherent power of a court to set aside an order passed under a misapprehension of facts.
Exceptions to Section 362 CrPC: Limited exceptions to the bar of Section 362 CrPC for recalling or reviewing orders have been carved out, such as where the court lacked inherent jurisdiction, a fraud was played, a court’s mistake caused prejudice, or a necessary party was not served/represented. However, these exceptions apply only if the ground was not available or existent at the time of the original proceedings.
Reasoning
The Supreme Court’s reasoning for overturning the High Court’s recall order centered on the following points:
Nature of Section 340 CrPC Proceedings: The Court clarified that proceedings initiated under Section 340 CrPC are criminal in nature. This is because their outcome can lead to a criminal trial and punishment for offenses under penal law (e.g., perjury), and Section 4(1) CrPC mandates that such offenses be dealt with according to the CrPC.
Inapplicability of CPC: Given the criminal nature of Section 340 CrPC proceedings, the provisions of the CPC, specifically Order XLVII CPC for review, are not applicable or maintainable. The CrPC is a self-contained code.
The Strict Bar of Section 362 CrPC: The Court reiterated that Section 362 CrPC imposes a strict bar on criminal courts altering or reviewing their signed judgments or final orders, with exceptions only for clerical/arithmetical errors or if provided by other law. This bar applies rigorously.
“Procedural Review” Not Applicable: The High Court’s recall order did not fall within the narrow ambit of a “procedural review”.
The Khosla Group was not denied a hearing or an opportunity to inform the court about the withdrawal of CP 114 of 2007.
Ms. Sonia Khosla herself withdrew CP 114 of 2007 more than six months before the High Court’s August 13, 2020 judgment was passed.
Crucially, the Khosla Group had explicitly stated in paragraph 23 of the August 13, 2020 judgment that the NCLT was still seized of the proceedings.
The ground for recall – the withdrawal of CP 114 of 2007 – was fully available to the Khosla Group at the time of the original hearing but was not raised.
The Court viewed this as an intentional attempt to mislead the court and abuse the judicial process.
Violation of Supreme Court’s Directions: The High Court’s original judgment dated August 13, 2020, was based on the binding directions of the Supreme Court’s May 8, 2014 judgment, which had vested jurisdiction in the CLB/NCLT to decide CP 114 of 2007 and related Section 340 CrPC applications, specifically directing the High Court not to proceed. The subsequent withdrawal of CP 114 of 2007 by Ms. Sonia Khosla did not disturb these binding directions regarding the CLB/NCLT’s jurisdiction.
Holding
In light of the above, the Supreme Court concluded that the High Court’s Impugned Order dated May 5, 2021, was antithetical to the settled law under Section 362 CrPC and was an impermissible attempt to substantially review its earlier judgment under the garb of “procedural review”.
Therefore, the Supreme Court allowed the appeal and set aside the High Court’s Impugned Order dated May 5, 2021.
VIKRAM BAKSHI AND OTHERS V. R.P. KHOSLA AND ANOTHER
Supreme Court: 2025 INSC 10120 (DoJ 20-08-2025)
