M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIRECTOR SHRI PRADEEP KUMAR AGRAWAL versus GOVERNMENT OF N.C.T. OF DELHI THROUGH ITS PRINCIPAL SECRETARY (FINANCE) & ORS. on 19 September 2022

1. The main question raised in this batch of appeals is, whether,‘Pan Masala’, which contains tobacco and gutka, covered by an Entryin the First Schedule to the Additional Duties of Excise (Goods of SpecialImportance) Act 1957, hereinafter referred to as the ‘ADE Act’, aretaxable by the State under the Delhi Sales Tax Act 1975 and/or theUttar Pradesh Trade Tax Act 1948 and/or the Tamil Nadu General SalesTax Act, 1959.

2. In Shanti Fragrances v. Union of India and others[1], aDivision Bench of this Court observed:-

12. It does appear that there is a direct conflict between KothariProducts [Kothari Products Ltd. v. State of A.P., (2000) 9 SCC263], Radheshyam Gudakhu Factory [State of Orissa v.Radheshyam Gudakhu Factory, (2018) 11 SCC 505 : (1988) 68STC 92 (SC)] and Reliance Trading Co. [Reliance Trading Co.v. State of Kerala, (2011) 15 SCC 762] judgments on the onehand, and Agra Belting Works [CST v. Agra Belting Works,(1987) 3 SCC 140 : 1987 SCC (Tax) 233] , which was also followedby two other judgments, on the other. We may hasten to add thatthere are three-Judge Bench decisions on both sides. ...”

3. The Bench further observed:-

3. The Bench further observed:-

“13. … One other interesting feature of this case is whether,after Union of India v. Raghubir Singh[2], SCR at pp. 335-37 :SCC pp. 777-78, para 27, it can be stated that Judges of thisCourt do not sit in 2s and 3s for mere convenience, but that aBench which is numerically superior will prevail over a Benchof lesser strength. If the doctrine of precedent, as applied bythis Court, is to be a matter of numbers, then, interestingly

* Ed. Note: There were two separate judgments in the matter- one judgment rendered byHon’ble Ms. Justice Indira Banerjee, for herself and on behalf of Hon’ble Mr. JusticeSurya Kant, Hon’ble Mr. Justice M.M. Sundresh and Hon’ble Mr. Justice SudhanshuDhulia; and the other judgment rendered by Hon’ble Mr. Justice Hemant Gupta.1 (2018) 11 SCC 305

2 (1989) 2 SCC 754; (1989) 3 SCR 316

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enough, as has been held by Beaumont, C.J. in NingappaRamappa Kurbar v. Emperor[3], the position in law could be asunder: (AIR p. 409 : SCC OnLine Bom)

“…The Court in that case consisted of five Judges, one ofwhom, Shah, J., dissented from that proposition. Theauthority of the case may be open to question, since therehad been a previous decision of a Full Bench of this Courtof four Judges in Queen Empress v. Mugappa Bin Ningapa[Queen Empress v. Mugappa Bin Ningapa, ILR (1893) 18Bom 377], which had reached a different conclusion.Apparently it was considered that five Judges, by a majorityof four to one, could overrule a unanimous decision offour Judges, the net result being that the opinion of fourJudges prevailed over the opinion of five Judges of co-ordinate jurisdiction. There seems to be very little authorityon the powers and constitution of a Full Bench. There canbe no doubt that a Full Bench can overrule a DivisionBench, and that a Full Bench must consist of three or moreJudges; but it would seem anomalous to hold that a laterFull Bench can overrule an earlier Full Bench, merelybecause the later Bench consists of more Judges than theearlier. If that were the rule, it would mean that a Bench ofseven Judges, by a majority of four to three, could overrulea unanimous decision of a Bench of six Judges, though allthe Judges were of co-ordinate jurisdiction. In Enatullahv. Kowsher Ali [Enatullah v. Kowsher Ali, 1926 SCCOnLine Cal 104 : ILR (1927) 54 Cal 266] , Sanderson,C.J., stating the practice in Calcutta, seems to have beenof opinion that a decision of a Full Bench could only bereversed by the Privy Council or by a Bench speciallyconstituted by the Chief Justice. Even if this be the truerule, there is nothing to show that the Chief Justice actedupon it in Emperor v. Purshottam Ishwar Amin [Emperorv. Purshottam Ishwar Amin, 1920 SCC OnLine Bom 144 :ILR (1921) 45 Bom 834] . I do not recollect myself ever tohave constituted a Special Bench to consider the ruling ofa Full Bench, though I have constituted many Full Benches H3 1941 SCC OnLine Bom 41 : AIR 1941 Bom 408

M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [INDIRA BANERJEE, J.]

to consider rulings of Division Benches. However, I neednot pursue this subject further, since, for the purpose ofthe present appeal, I am prepared to assume that analternative charge of perjury lies, and that it was a chargeof that nature which the learned Additional Sessions Judgecontemplated. The question then is whether it is expedientin the interests of justice that such a charge should bemade.”

14. This conundrum was also addressed by M.B. Lokur, J.in Supreme Court Advocates-on-Record Assn. v. Union of India[Supreme Court Advocates-on-Record Assn. v. Union of India,(2016) 5 SCC 1] , as follows: (SCC pp. 577-78, para 669)

“669. One of the more interesting aspects of PradeepKumar Biswas [Pradeep Kumar Biswas v. Indian Instituteof Chemical Biology, (2002) 5 SCC 111 : 2002 SCC (L&S)633] is that out of the 7 (seven) learned Judges constitutingthe Bench, 5 learned Judges overruled the unanimousdecision of another set of 5 learned Judges in SabhajitTewary [Sabhajit Tewary v. Union of India, (1975) 1 SCC485 : 1975 SCC (L&S) 99] . Two of the learned Judges inPradeep Kumar Biswas [Pradeep Kumar Biswas v. IndianInstitute of Chemical Biology, (2002) 5 SCC 111 : 2002SCC (L&S) 633] found that Sabhajit Tewary [SabhajitTewary v. Union of India, (1975) 1 SCC 485 : 1975 SCC(L&S) 99] had been correctly decided. In other words, whilea total of 7 learned Judges took a particular view on anissue of fact and law, that view was found to be incorrectby 5 learned Judges, whose decision actually holds thefield today. Is the weight of numbers irrelevant? Is it thatonly the numbers in a subsequent Bench are what reallymatters? What would have been the position if only 4learned Judges in Pradeep Kumar Biswas [Pradeep KumarBiswas v. Indian Institute of Chemical Biology, (2002) 5SCC 111 : 2002 SCC (L&S) 633] had decided to overruleSabhajit Tewary [Sabhajit Tewary v. Union of India,(1975) 1 SCC 485 : 1975 SCC (L&S) 99] while theremaining 3 learned Judges found no error in thatdecision? Would a decision rendered unanimously by a A

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Bench of 5 learned Judges stand overruled by the decisionof 4 learned Judges in a subsequent Bench of 7 learnedJudges? Pradeep Kumar Biswas [Pradeep KumarBiswas v. Indian Institute of Chemical Biology, (2002) 5SCC 111 : 2002 SCC (L&S) 633] presents a ratheranomalous situation which needs to be addressed byappropriate rules of procedure. If this anomaly isperpetuated then the unanimous decision of 9 learnedJudges in Third Judges case [Special Reference No. 1 of1998, In re, (1998) 7 SCC 739] can be overruled (as soughtby the learned Attorney General) by 6 learned Judges in aBench of 11 learned Judges, with 5 of them taking adifferent view, bringing the total tally of Judges havingone view to 14 and having another view to 6, with the viewof the 6 learned Judges being taken as the law!”

15. It may be pointed out that in the present case, if numbers aretotted up, the Kothari Products [Kothari Products Ltd. v. Stateof A.P., (2000) 9 SCC 263] line, as followed in RadheshyamGudakhu Factory [State of Orissa v. Radheshyam GudakhuFactory, (2018) 11 SCC 505 : (1988) 68 STC 92 (SC)]and Reliance Trading Co. [Reliance Trading Co. v. State ofKerala, (2011) 15 SCC 762], will go to a Bench strength,numerically speaking, of eight learned Judges, as against the AgraBelting Works [CST v. Agra Belting Works, (1987) 3 SCC 140: 1987 SCC (Tax) 233] line, which goes up to a numerical strengthof six learned Judges. If the dissenting judgment of B.C. Ray, J. isto be added to the Kothari Products [Kothari Products Ltd. v.State of A.P., (2000) 9 SCC 263] line, then we have a numericalstrength of 9:6. The question of numerical strength gains poignancywhen one judgment is overruled by another, as has been pointedby Beaumont, C.J. in Ningappa Ramappa Kurbar [NingappaRamappa Kurbar v. Emperor, 1941 SCC OnLine Bom 41 : AIR1941 Bom 408], and by Lokur, J. in Supreme Court Advocates-on-Record Assn. [Supreme Court Advocates-on-Record Assn.v. Union of India, (2016) 5 SCC 1]”

4. The two-Judge Bench, referred to the Constitution Bench, thefollowing questions:

M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [INDIRA BANERJEE, J.]

i)Whether the Kothari Products Ltd. v. State of A.P.[4] lineof judgments or the Central Sales Tax vs. Agra BeltingWork[5], line of judgments is correct in law; and

ii)What should be the proper guidelines for the future foroverruling an earlier decision of this Court, and to whatextent should the Courts be guided by the propositions inNingappa Ramappa Kurbar v. Emperor[6], theobservations of Lokur, J. in Supreme Court Advocates-on-Record Assn. v Union of India[7] and the judgment ofthe Court of Appeal in Harper v. National Coal Board[8].

5. The ADE Act has been enacted to provide for the levy andcollection of additional duties of excise in respect of certain goods, overand above the duties of excise levied under the Central Excise Act 1944.The Statement of Objects of the ADE Act reads:- “The object of the Bill is to impose additional duties ofexcise in replacement of the sales taxes levied by the Unionand States on sugar, tobacco and mill-made textiles and todistribute the net proceeds of these taxes, except the proceedsattributable to Union Territories, to the States. The distributionof the proceeds of the additional duties broadly follows thepattern recommended by the Second Finance Commission.Provision has been made that the States which levy a tax on thesale or purchase of these commodities after 1.4.1958 do notparticipate in the distribution of the net proceeds. Provision isalso being made in the Bill for including these three goods inthe category of goods declared to be of special importance ininter-State trade or commerce so that, following the impositionof uniform duties of excise on them, the rates of sales tax iflevied by any State are subject from 1.4.1958 to the restrictionsin Section 15 of the Central Sales Tax Act, 1956.”

6. In Mahalakshmi Oil Mills v. State of A.P.[9], this Court, held:- “5 .. In short, the object of the Act was to substituteadditional duties of excise in place of sales tax so far as 4 (2000) 9 SCC 2635 (1987) 3 SCC 140

6 1941 SCC Online Bom 41 : Air m1941 Bom 408

7 (2016) 5 SCC 1

8 [1974] QB 614

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Athese goods were concerned. Since the State legislatures wereat liberty, if they wished, to levy taxes on the sale or purchaseof these commodities, the Act provided that the additionalexcise duties will be distributed only among such States asdid not levy a tax on the sale or purchase of thesecommodities. Also, by including these goods in the categoryBof goods declared to be of special importance in inter-Statetrade or commerce, the legislation ensured that, if any Statelevied sales tax in respect of these commodities, such levywas subject to the restrictions contained in the Central SalesTax Act, 1956.”C

7. It is well settled that once goods are chargeable under theADE Act, the State cannot levy sales tax on the same goods under aState enactment. In Godfrey Phillips India Ltd. v. State of U.P[10]., thisCourt held:- D“70. So even if tobacco is an article of luxury, a tax on itssupply is within the exclusive competence of the State butsubject to the constitutional curbs prescribed under Article286 read with Sections 14 ad 15 of the Central Sales Tax Act,1956 and most importantly the ADE Act of 1957 under whichno sales tax can be levied on tobacco at all if the State was toEtake the benefits under that Act.”

8. In Kothari Products Ltd. (supra), the question was, ‘tobacco’being specified in the First Schedule to the ADE Act, and exemptedfrom Sales Tax under Section 8 of the Andhra Pradesh General SalesTax Act 1957, whether ‘gutka’ could be taxed by the State of AndhraFPradesh. The Court found that “gutka” being tobacco, covered by anEntry in the First Schedule to the ADE Act and liable to be taxed underthe ADE Act, it was covered by the exemption in Section 8 of the AndhraPradesh General Sales Tax Act . The State Act could not have beenamended to tax “gutka”.G

9. There is a line of decisions of this Court, taking the same viewas Kothari Products Ltd. (supra) and holding that items covered bythe expression ‘tobacco’ and other items included in the First Scheduleto the ADE Act are not taxable by the State.

M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [INDIRA BANERJEE, J.]

10. In the State of Orrisa vs. Radhey Shyam GudakhuFactory[11], the issue was whether Gudakhu was covered by theexpression ‘tobacco’ as defined in Section 2(c) of ADE Act. Followingthe decision of the Calcutta High Court in Gulabchand Harekchand v.State of West Bengal[12], this Court held that Gudakhu is a product of‘tobacco’ and hence, a product which falls within the exemption coveredby S. No. 35 of the Schedule to the Orissa Sales Tax Act 1947.

11. In Reliance Trading Company, Kerala v. State of Kerala[13],this Court took the view that cotton based tarpaulin was exempted fromSales Tax under the Kerala General Sales Tax Act, 1963, since it wasexigible to Additional Excise Duty under the First Schedule of the ADEAct.

12. In Agra Belting Works (supra), the question was whetherany class of goods – cotton fabrics of all kinds, to be specific, exemptedfrom Sales Tax Act under section 4 of the Uttar Pradesh Sales Tax Act,1948, would be exigible to Sales Tax by virtue of a subsequent Notificationunder Section 3-A of the said Act, specifying the rate of sales tax inrespect of an item of the class of goods exempted under Section 4,without withdrawing the earlier Notification under Section 4. While themajority held that a Notification of recall of exemption was not a conditionprecedent for imposition of tax, by a valid Notification under Section 3-A, B.C.Ray, J. dissented with the view of the majority.

13. In Agra Belting Works (supra),the majority of the three-Judge Bench of this Court, by ratio of 2:1, inter alia, held:- “6. As has been pointed out above, Section 3 is the chargingprovision; Section 3-A authorises variation of the rate of taxand Section 4 provides for exemption from tax. All the threesections are parts of the taxing scheme incorporated in theAct and the power both under Section 3-A as also underSection 4 is exercisable by the State Government only. Whenafter a notification under Section 4 granting exemption fromliability, a subsequent notification under Section 3-Aprescribes the rate of tax, it is beyond doubt that the intentionis to withdraw the exemption and make the sale liable to tax 11 (2018) 11 SCC 505

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at the rate prescribed in the notification. As the power bothfor the grant of exemption and the variation of the rate of taxvests in the State Government and it is not the requirement ofthe statute that a notification of recall of exemption is acondition precedent to imposing tax at any prescribed rateby a valid notification under Section 3-A, we see no force inthe contention of the assessee which has been upheld by theHigh Court. In fact, the second notification can easily betreated as a combined notification — both for withdrawal ofexemption and also for providing higher tax. When powerfor both the operations vests in the State and the intention tolevy the tax is clear we see no justification for not givingeffect to the second notification. We would like to point outthat the exemption was in regard to a class of goods and whilethe exemption continues, a specific item has now been notifiedunder Section 3-A of the Act.”

14. B.C. Ray, J. dissenting with the majority view, held:- “14. The next question for consideration is what is the effectof a notification under Section 3-A including an item in theSchedule for imposition of sales tax though there is a generalexemption from sales tax under Section 4 of the Sales TaxAct.

…

15. A similar question also arose in the case of CST v. RitaIce Cream Co., Gorakhpur [1981 UPTC 1239 (DB)(All HC)]and it was held that so long as the general exemption underSection 4 continues a particular item notified under Section3-A of Sales Tax Act cannot be taxed.

16. On a conspectus of all these decisions aforesaid, the onlyirresistible inference follows that so long as the generalexemption granted under Section 4 with regard to cottonfabrics of all kinds continues no sales tax can be imposed onbeltings of all kinds which fall within the cotton fabrics of allkinds and the general exemption under Section 4 will prevailover the notification made under Section 3-A of the Sales TaxAct. I am unable to subscribe to the view that since thenotification under Section 3-A of the U.P. Sales Tax Act has M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [INDIRA BANERJEE, J.]

been made subsequent to the notification issued under Section4 of the said Act, the subsequent notification under Section3-A will prevail over the general exemption granted underSection 4 of the said Act. In my considered opinion thereasonings and conclusions arrived at by the High Court areunexceptionable.”

15. In Sales Tax Officer, Sector-IX, Kanpur vs. Dealing DairyProducts and Anr.[14], a two Judge Bench of this Court followed themajority decision in Agra Belting Works (supra), and held that, eventhough the State of Uttar Pradesh had been issuing notifications underSection 4 of the U.P. Sales Tax Act 1948, exempting milk and milkproducts from levy of sales tax, a later notification under Section 3-Anotifying the rate of tax on ice-cream amongst other items, withdrewthe exemption in respect of all kinds of ice-cream and made the sale ofice-cream exigible to sales tax at the rate specified in the Notificationunder Section 3A.

16. In State of Bihar and Others v. Krishna Kumar Kabra andAnother[15], a two Judge Bench of this Court referred to and followedAgra Belting Works (supra)and Dealing Dairy Products (supra)and held that Sections 3-A and 4 of the U.P. Sales Tax Act were parts ofa taxing scheme incorporated in that Act and therefore, where thenotification was issued under Section 3-A prescribing the rate of tax ongoods, which had been exempted from tax under Section 4, by an earliernotification, it had to be held that the later notification was intended towithdraw the exemption and make the sale leviable to tax at the rateprescribed in the later notification.

17. In our considered opinion there is no conflict between theKothari Products (supra) line of cases and the Agra Belting line ofcases. The Kothari Products (supra) line of cases was on the questionof whether “tobacco” or other goods specified in the First Schedule tothe ADE Act and hence exempted from Sales Tax under State sales taxenactments, can be made exigible to tax under the State enactments byamending the Schedule thereto. On the other hand, Agra Belting Works(supra) line of cases was on the question of interplay between generalexemption of specified goods from sales tax under Section 4 of the U.P.

14 (1994) Supp. 2 SCC 639

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ASales Tax Act and specification of rates of sales tax under Section 3-Aof the said Act. This Court held that goods exempted from sales taxunder Section 4 would be exigible to tax by virtue of subsequent notificationunder Section 3-A specifying the rate of sales tax for any specific itemof the class of goods earlier exempted under Section 4. There being noconflict, the reference to Constitution Bench is incompetent. The casesBmay be placed for decision before the regular Bench.

18. The second question is answered by the judgment of theConstitution Bench of this Court in Dr. Jaishri Laxmanrao Patil v.The Chief Minister and Others.[16]. The Constitution Bench speakingthrough Bhat, J. held:-C

“10. A careful reading of the judgments in IndraSawhney v. Union of India [Indra Sawhney v. Union of India,1992 Supp (3) SCC 217 : 1992 SCC (L&S) Supp 1] , clarifiesthat seven out of nine Judges concurred that there exists aquantitative limit on reservation—spelt out at 50%. In theopinion of four Judges, therefore, per the judgment of B.P.Jeevan Reddy, J., this limit could be exceeded underextraordinary circumstances and in conditions for whichseparate justification has to be forthcoming by the State orthe agency concerned. However, there is unanimity in theconclusion by all seven Judges that an outer limit forreservation should be 50%. Undoubtedly, the other twoJudges, Ratnavel Pandian and P.B. Sawant, JJ. indicated thatthere is no general rule of 50% limit on reservation. In thesecircumstances, given the general common agreement aboutthe existence of an outer limit i.e. 50%, the petitioner’sargument about the incoherence or uncertainty about theexistence of the rule or that there were contrary observationswith respect to absence of any ceiling limit in other judgments(the dissenting judgments of K. Subba Rao, in T.Devadasan v. Union of India [T. Devadasan v. Union of India,(1964) 4 SCR 680 : AIR 1964 SC 179] , the judgments ofS.M. Fazal Ali and Krishna Iyer, JJ. in State of Kerala v. N.M.Thomas [State of Kerala v. N.M. Thomas, (1976) 2 SCC 310 :1976 SCC (L&S) 227] and the judgment of Chinnappa Reddy,J. in K.C. Vasanth Kumar v. State of Karnataka [K.C. Vasanth D

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M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [INDIRA BANERJEE, J.]

Kumar v. State of Karnataka, 1985 Supp SCC 714 : 1985Supp (1) SCR 352] ) is not an argument compelling a reviewor reconsideration of Indra Sawhney [Indra Sawhney v.Union of India, 1992 Supp (3) SCC 217 : 1992 SCC (L&S)Supp 1] rule.

11. The respondents had urged that discordant voices indifferent subjects (Devadasan [T. Devadasan v. Union ofIndia, (1964) 4 SCR 680 : AIR 1964 SC 179] , N.M.Thomas [State of Kerala v. N.M. Thomas, (1976) 2 SCC 310: 1976 SCC (L&S) 227] and Indra Sawhney [Indra Sawhneyv. Union of India, 1992 Supp (3) SCC 217 : 1992 SCC (L&S)Supp 1] ) should lead to re-examination of the ratio in IndraSawhney [Indra Sawhney v. Union of India, 1992 Supp (3)SCC 217 : 1992 SCC (L&S) Supp 1]. It would be useful tonotice that unanimity in a given Bench (termed as a “supermajority”) — denoting a 5 : 0 unanimous decision in aConstitution Bench cannot be construed as per se a strong orcompelling reason to doubt the legitimacy of a larger Benchruling that might contain a narrow majority (say, for instancewith a 4 : 3 vote, resulting in overruling of a previousunanimous precedent). The principle of stare decisis operatesboth vertically — in the sense that decisions of appellate courtsin the superior in vertical hierarchy, bind tribunals and courtslower in the hierarchy, and horizontally — in the sense that alarger Bench formation ruling, would be binding and prevailupon the ruling of a smaller Bench formation. The logic inthis stems from the raison d’être for the doctrine of precedentsi.e. stability in the law. If this rule were to be departed fromand the legitimacy of a subsequent larger Bench ruling wereto be doubted on the ground that it comprises of eitherplurality of opinions or a narrow majority as compared witha previous Bench ruling (which might be either unanimous orof a larger majority, but of lower Bench strength), there wouldbe uncertainty and lack of clarity in the realm of precedentialcertainty. If precedential legitimacy of a larger Bench rulingwere thus to be doubted, there are no rules to guide the courts’hierarchy or even later Benches of the same court about whichis the appropriate reading to be adopted (such as for instance,the number of previous judgments to be considered fordetermining the majority, and consequently the correct law).

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A12. In view of the above reasoning, it is held that the existenceof a plurality of opinions or discordant or dissident judgmentsin the past — which might even have led to a majority (on anoverall headcount) supporting a particular rule in aparticular case cannot detract from the legitimacy of a ruleenunciated by a later, larger Bench, such as the nine-JudgeBBench ruling in Indra Sawhney [Indra Sawhney v. Union ofIndia, 1992 Supp (3) SCC 217 : 1992 SCC (L&S) Supp 1] .”

19. The view of Bhat, J. was expressly concurred by Rao, J.(Para 196) and Gupta, J. (Para 227). There was no dissent to the view.In view of Article 145(5) of the Constitution of India concurrence of aCmajority of the judges at the hearing will be considered as a judgment oropinion of the Court. It is settled that the majority decision of a Bench oflarger strength would prevail over the decision of a Bench of lesserstrength, irrespective of the number of Judges constituting the majority.

20. In view of the five-Judge Bench decision in Dr. JaishriDLaxman Rao (supra), it is not necessary for this Court to answer thequestion.

HEMANT GUPTA, J.

EA. I entirely agree with the judgment authored by Hon. IndiraBanerjee J. However, in respect of Question No.2, I would like tosupplement the opinion expressed.

B. Mr. Gopal Sankaranarayanan, learned Senior Advocatereferred to Article 145(5) of the Constitution to contend that a judgmentFof this Court is mandated to be delivered with the concurrence of amajority of the Judges present at the hearing of the case, but nothing inthis clause shall be deemed to prevent a Judge who does not concurfrom delivering a dissenting judgment or opinion. Thus, the Constitutionitself envisaged that the judgment is by the majority of the Judges.

GC. A reference was made to insertion of Article 144A in theConstitution by the 42[nd] Amendment with effect from 01.02.1977. Theamendment reads thus:

“144-A. Special provisions as to disposal of questions relating toconstitutional validity of laws – (1) The minimum number of JudgesHof the Supreme Court who shall sit for the purpose of determining M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGH

ITS PRINCIPAL SECRETARY (FINANCE) [HEMANT GUPTA, J.]

any question as to the constitutional validity of any Central law orState law shall be seven.

A. A Central law or a State law shall not be declared to beconstitutionally invalid by the Supreme Court unless a majority ofnot less than two-thirds of the Judges sitting for the purpose ofdetermining the question as to the constitutional validity of suchlaw hold it to be constitutionally invalid.”

D. The said amendment was undone by 43[rd] Amendment whenArticle 144-A was omitted with effect on and from 01.02.1977. Thoughthe said insertion of Article 144-A stands repealed, but it shows that thelegislature also considered majority of not less than 2/3[rd] of Judges shoulddetermine the question as to the constitutional validity of law. Therefore,even such amendment contemplated dissent and a minority view.

E. A similar question has been examined by a Full Bench of theHigh Court of Gujarat in a judgment reported as State of Gujarat vGordhandas Keshavji Gandhi and Ors.[17]. The Court was consideringthe binding nature of the judgments of the Bombay High Court in thesuccessor Gujarat High Court but an ancillary question was consideredin respect of numerical strength of the Bench as well. Though there isdivergence of opinion amongst the judges of the Court, but the minorityview was relevant for the second question arising for consideration. Theminority view is expressed by N.M. Miabhoy J and P.N.Bhagwati J. Weare in agreement with the said view. The order passed by learned Hon’bleMr. Justice N.M. Miabhoy J reads thus:

“44. ……………The principles which guided the latter Court inthe matter of judicial precedents have been set out by that Courtin (1944) 1 KB 718. All Division Benches considered themselvesto be bound by the judicial precedents created by Full Benchesnot only on the ground of judicial comity but also on the groundthat a Full Bench consisted of more number of Judges than aDivision Bench. If a judicial precedent created by a Full Benchrequired to be reconsidered, then, the usual practice was to referthe matter to a Full Bench consisting of more number of Judgesthan the number which constituted the former Full Bench whosedecision was sought to be revised. The practice was to regard theprecedent of a larger Full Bench as having greater efficacy and AB

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Abinding authority than the precedent of a Full Bench consisting ofa smaller number of Judges. This practice was criticised byBeaumont, C.J. in 43 Bom LR 864 at p. 868 : (AIR 1941 Bom408 at p. 409). It is not necessary to express any opinion in thiscase as to whether this criticism was or was not justified. However,the observations made by the learned Chief Justice in the aboveBcase ignores the important fact that, when a Full Bench consistsof a larger number of Judges, then, the decision is not merelyof a greater number of Judges, but it is one arising from outof the joint deliberations and discussions of a greater numberof Judges and that this fact may give to the decision of a FullCBench consisting of a larger number of Judges a greater bindingauthority than that of a Full Bench consisting of a smaller numberof Judges…………….. In view of the observations made by TheirLordships of the Supreme Court in the aforesaid two cases[18], theview that should prevail in India is the view-that the decision of alarger Full Bench should be followed in preference to the decisionDof a smaller Full Bench.

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The order passed by learned Hon’ble Mr. Justice P. N. Bhagwatireadsthus:-Exxxxxxxxx

117. ……………………Is the subsequent Full Bench of the HighCourt bound to follow the decision of the previous Full Bench ofthe High Court, though the previous Full Bench consisted of alesser number of Judges than the subsequent Full Bench? TheFquestion ultimately resolves itself into a narrow one, namely, howfar the principle of superiority of numerical strength should becarried. If the principle of superiority of numerical strength is appliedto Full Benches of the High Court whatever be the numericalstrength of the Judges constituting the Full Benches, a Full BenchGof four Judges would be able to override the previous decision ofa Full Bench of three Judges, a Full Bench of five Judges wouldbe able to override the previous decision of a Full Bench of fourJudges and so on and so forth. Beaumont, C.J., expressed a doubt 18 (1) AIR 1960 SC 936H (2) AIR 1960 SC 1118

M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [HEMANT GUPTA, J.]

as regards the correctness of this position in 43 Bom LR 864 :(AIR 1941 Bom 408) in the following terms:—

“……Apparently it was considered that five Judges by amajority of four to one, could overrule a unanimous decision offour Judges, the net result being that the opinion of four Judgesprevailed over the opinion of five Judges of co-ordinatejurisdiction. There seems to be very little authority on the powersand constitution of a Full Bench.-There can be no doubt that aFull Bench can overrule a Division Bench, and that a Full Benchmust consist of three or more Judges; but it would seemanomalous to hold that a later Full Bench can Overrule anearlier Full Bench, merely because the later bench consists ofmore Judges than the earlier. If that were the rule, it wouldmean that a Bench of seven Judges, by a majority of four tothree, could overrule a unanimous decision of a Bench of sixJudges, though all the Judges were of co-ordinate jurisdiction.”

.......................... It was the anomaly of this situation whichprompted Beaumont, C.J., to make the aforesaid observations.This anomaly is, however, inherent in the principle ofsuperiority of numerical strength and should not stand in theway of acceptance of that principle in its application to FullBenches of the High Court. The same anomaly also arises whenfour or five Judges of the High Court, each sitting singly take oneview of the law on a particular point while a Division Benchconsisting of two Judges takes a different view or when three orfour Division Benches, each consisting of two Judges, take oneview on a point of law while a Full Bench of three Judges takes adifferent view. The opinion of two Judges prevails over the opinionof four or five Judges in the former case while in the latter casethe opinion of three Judges prevails over the opinion of eight orten Judges, though all the Judges are of co-ordinate jurisdiction.This anomaly cannot, therefore, be a valid argument against theapplication of the principle of superiority of numerical strengthamongst Full Benches of the High Court. The principle ofsuperiority of numerical strength is a principle which, as I havealready pointed out above, imparts flexibility to the law and providesan easy machinery within the framework of the High Court itselffor correction of erroneous decisions which would otherwise stand A

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Ainviolate, immune from challenge except on appeal to the SupremeCourt.” (Emphasis Supplied)

F. It may be mentioned that a Constitution Bench of this Court ina judgment reported as Central Board of Dawoodi Bohra Communityand Anr. v. State of Maharashtra and Anr.[19] quoted from the earlierBConstitution Bench judgment in Union of India and Anr. v. RaghubirSingh (Dead) By Lrs. Etc.[20 ]and held as under:

“10. Reference was also made to the doctrine of stare decisis.His Lordship observed by referring to Sher Singh v. State ofPunjab [(1983) 2 SCC 344 : 1983 SCC (Cri) 461] that althoughthe Court sits in divisions of two and three Judges for the sake ofconvenience but it would be inappropriate if a Division Bench oftwo Judges starts overruling the decisions of Division Benches ofthree. To do so would be detrimental not only to the rule ofdiscipline and the doctrine of binding precedents but it will alsolead to inconsistency in decisions on points of law; consistencyand certainty in the development of law and its contemporarystatus — both would be immediate casualty.

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12. Having carefully considered the submissions made by thelearned Senior Counsel for the parties and having examined thelaw laid down by the Constitution Benches in the abovesaiddecisions, we would like to sum up the legal position in the followingterms:

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(1) The law laid down by this Court in a decision delivered by aFBench of larger strength is binding on any subsequent Bench oflesser or coequal strength.

(2) A Bench of lesser quorum cannot disagree or dissent from theview of the law taken by a Bench of larger quorum. In case ofdoubt all that the Bench of lesser quorum can do is to invite theattention of the Chief Justice and request for the matter beingplaced for hearing before a Bench of larger quorum than the Benchwhose decision has come up for consideration. It will be openonly for a Bench of coequal strength to express an opinion doubting G

19 (2005) 2 SCC 673H20 (1989) 2 SCC 754

M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIR. SHRIPRADEEP KUMAR AGRAWAL v. GOVT. OF N.C.T. OF DELHI THROUGHITS PRINCIPAL SECRETARY (FINANCE) [HEMANT GUPTA, J.]

the correctness of the view taken by the earlier Bench of coequalstrength, whereupon the matter may be placed for hearing beforea Bench consisting of a quorum larger than the one whichpronounced the decision laying down the law the correctness ofwhich is doubted.

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(3)...........................”

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G. The conclusion (1) is that a decision delivered by a Bench oflargest strength is binding on any subsequent Bench of lesser or coequalstrength. It is the strength of the Bench and not number of Judges whohave taken a particular view which is said to be relevant. However,conclusion (2) makes it absolutely clear that a Bench of lesser quorumcannot disagree or dissent from the view of law taken by a Bench oflarger quorum. Quorum means the bench strength which was hearingthe matter.

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H. Thus, it has been rightly concluded that the numerical strengthof the Judges taking a particular view is not relevant, but the BenchDstrength is determinative of the binding nature of the Judgment.

Divya Pandey(Assisted by : Deepak Panwar, LCRA)

Reference disposed of.

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