The Supreme Court of India recently passed an order in Asian Resurfacing of Road Agency Private Limited & Another vs Central Bureau of Investigation , directing that a stay granted by any court (including the High Courts), in any civil or criminal proceedings, shall automatically cease to have effect on expiry of 6 months, unless extended for good reasons.

BACKGROUND

• In the present case, the Complainant had approached the Court of the Additional Chief Judicial Magistrate, Pune (Trial Court) for resumption of trial that had been stayed by the Bombay High Court. However, the Trial Court refused the plea of the Complainant to resume trial and directed the Complainant to move an application for resuming trial before the Bombay High Court, as it cannot pass any order in a proceeding which has been stayed by the superior court, being the Bombay High Court.
   
• The Trial Court’s order deviated from what was laid down in a 2018 Judgment of the Supreme Court (2018 Judgment) , in the same matter in which the Supreme Court had directed that all stay orders against proceedings shall terminate within 6 months. In light of the above circumstances, the Complainant once again approached the Supreme Court.

Supreme Court observed that:

• The order of the Trial Court directing the Complainant to approach the High Court is contrary to its 2018 Judgment, wherein, the Supreme Court had held that, in all cases where a stay against proceedings of a civil or criminal trial is operating, the same shall come to an end on the expiry of 6 months from the date of the 2018 judgement. Further, any stay against proceedings, granted post the 2018 judgment shall cease to have effect on the expiry of 6 months from the date of the order granting such stay, unless extension is granted by a speaking order.
   
• The Supreme Court clarified that under the Constitution of India, the Supreme Court is at the apex, and the High Courts, though not subordinate administratively, are certainly subordinate judicially. Thus, the Trial Court ought to have followed the 2018 Judgment instead of abiding by the stay order granted by the Bombay High Court.
   
• The Supreme Court held that stay against proceedings granted by any court, including the High Courts, automatically expires within a period of 6 months from the date of passing such a stay order, and unless extension is granted for good reason, by a speaking order, the trial judge shall on the expiry of 6 months, set a date for the trial and go ahead with the same.
   
• The Supreme Court set aside the order of the Trial Court and directed the Trial Court to set down the case for hearing.

MHCO Comment :

This decision of the Supreme Court reiterates the position laid down in the 2018 Judgment and will go a long way in ensuring that the proceedings do not remain adjourned sine die on account of stay orders. This is a welcome step by the Supreme Court towards bringing an end to long pending trials.

This update was released on 27 Oct 2020.

The views expressed in this update are personal and should not be construed as any legal advice. Please contact us directly on +91 22 40565252 or legalupdates@mhcolaw.com for any assistance.

Legal Update Team
MANSUKHLAL HIRALAL & COMPANY
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