Legal News for July 2026
Compassionate job, financial benefit can’t be conflicting, says apex court
In Haryana, if a family member is accused of murdering a govt servant, then he/she or their family members are not entitled to any compassionate financial benefit till they are cleared of the criminal case, but they are eligible for compassionate employment in lieu of the deceased employee.
Taking exception to this conflict, a bench of Justices Sanjay Karol and N K Singh said the incongruency in the welfare scheme is apparent as the lesser of the relief, that is the financial assistance, is suspended till the person is acquitted in the trial for murder of the deceased employee but is entitled to a bigger relief – permanent public employment.
Writing the judgment, Justice Singh said, “The result, on a plain reading of the Rules of 2019 as they stand, is that a family member who stands accused of complicity in the death of the govt employee cannot receive a monthly monetary payment during the criminal proceedings, but may, on this interpretation, be considered for a permanent govt appointment during the same period.”
Sale or allotment of parking space by builder is illegal
K T Thomas and his wife Sajita filed a complaint before the Maharashtra State Consumer Disputes Redressal Commission (state commission) against their housing society, Dheeraj Valley Building No. 3 CHS, regarding a dispute over the allotment of parking space.
The couple had purchased two flats in the building and were given possession on May 6, 2000. They requested the society to allot one car parking space according to the bye-laws so that they could park the vehicle provided to them by the company in which they were directors. They wrote to the society, calling upon it to cancel the previous allotments made by the builder and to allot space through draws, as prescribed under the bye-laws. They pointed out the law laid down by the Supreme Court on the subject while deciding the case of Nahalchand Laloochand Pvt Ltd vs Panchali Co-operative Housing Society Ltd.
They had to park their vehicle on the road outside the society, where it was once damaged after a tree fell on it. As the society showed reluctance to hold draws, the couple pointed out that the view of the majority of members could not prevail over the law laid down by the Supreme Court.
Since the society did not pay heed, the couple filed a complaint before the Maharashtra State Commission. They pointed out that all members must get a fair chance to park their vehicles within the society’s premises.
SC flags ‘nexus’ between banks, ARCs and borrowers over loans
Flagging a deep-rooted nexus between banks, asset reconstruction companies (ARCs) and borrowers, the Supreme Court said taxpayers’ money being given as loans and then no effective efforts being taken to recover them was not acceptable. A bench of Chief Justice Surya Kant and Justice V Mohana said it was only concerned about the mis-utilisation of public money, which should have been spent for the welfare of the people.
The court issued notice to the Centre, the RBI and others seeking their responses on a plea which alleged that Rs. 1,537 crore owed to public sector banks was settled through two ARCs for Rs. 73.50 crore. During the hearing, the Bench raised concerns over the manner in which stressed loans were being settled.
The court observed that it was aware of the limitation in entering into the arena of commercial wisdom of the banks.
The plea, filed through advocate Ashwani Kumar Dubey, sought a probe into the alleged banking fraud involving ARCs, public sector banks and a Noida-based infrastructure firm. It sought a direction to the Centre “to constitute a judicial commission or an expert committee, including officers of the RBI, SEBI, the SFIO, the ED and the CBI to investigate the corpor-ate and banking fraud facilitated by ARCs”.
The plea said the infrastructure firm obtained loans worth approximately Rs. 912 crore from a consortium of seven banks, led by SBI, between 2012 and 2015. It claimed a forensic audit in 2018 found evidence suggesting that more than Rs. 902 crore had been diverted through shell companies, non-existent vendors, undisclosed bank accounts and suspected fraudulent trans-actions. The plea, by Muzaffarnagar-based Prateeksha and two others, sought a probe into the alleged banking fraud.
SC: Criminal cases on loan defaulters must end after settlement
Supreme Court has held that criminal proceedings should not be allowed to go on against a loan defaulter if the bank and the debtor reached a compromise for settlement of the loan account. The SC said it would have a debilitating effect on the overall economy if such proceedings are allowed.
A bench of Justices B V Nagarathna and Ujjal Bhuyan said permitting such criminal proceedings would be oppressive for the loan defaulter and would also amount to an abuse of the process of the court after both the parties settle their dispute which is commercial in nature. It allowed the plea of a businessman who sought quashing of criminal case on the ground that he and the bank already compromised before debts recovery tribunal and paid the settlement amount of Rs 4.25 crore against the outstanding due of Rs 6.49 crore which included a notional interest of Rs 3.09 crore.
“Having regard to the fact that the dispute between the parties arising out of banking transactions which are commercial transactions having overwhelmingly or predominantly civil flavour had ended in a compromise settlement, that too, in the manner which we have delineated above, in our view, the possibility of his conviction of appellant No. 1 (businessman) is remote and bleak. Therefore, continuation of the criminal case would cause grave prejudice and injustice to the appellants,” the bench said.
SC: HCs must upload verdicts within 24 hours
In a bid to curb the “reserve and forget” habit among some high court judges, Supreme Court mandated a three month deadline for HCs to pronounce their verdicts, while also laying down that orders in bail cases must be passed immediately.
After coming across a series of appeals against convictions in criminal cases languishing indefinitely, a bench of Chief Justice Surya Kant and Justice Joymalya Bagchi said HCs must display extra promptitude in deciding matters concerning personal liberty, regular and anticipatory bail.
CJI Kant said, “Bail applications should be heard, and the order should preferably be pronounced and uploaded the same day. If it is reserved, it should be pronounced the next day and uploaded to the website.”
Mere prompt pronouncement of the order granting bail would no longer be sufficient as SC mandated that it must also be communicated to the jail authorities with equal promptness to ensure that the undertrial/convict is released from custody immediately, preferably the same day or certainly by the next day, unless s/he was required to be kept behind bars in other cases or for failure to furnish the bail bonds.
SC asked the trial courts concerned to report compliance of the bail order to their high courts.
However, SC gave some leeway to HCs and said if a bench was of the opinion that delivering a reasoned judgment would take time in cases where an order was required urgently, it could pronounce the operative part immediately and follow it up in the next 15 days. However, it said HCs must upload all verdicts within 24 hours of pronouncement.
CJI Kant and Justice Bagchi said the HC registry must give a monthly report on the number of judgments reserved to the chief justice, who could confidentially notify the judges concerned about cases in which judgments had been reserved for two months.
If the judge or bench concerned failed to pronounce the verdict in three months, the HC CJ would request them to do so in the next two weeks, failing which the case could be assigned to another judge/bench for a fresh hearing and a prompt decision, SC said, while accepting or modulating many of the suggestions given by amicus curiae Fauzia Shakil.
Apart from the steps to be taken by the CJ, SC gave liberty to the parties in such situations to file applications to assign their cases to another bench. It said every judgment must mention the date on which the verdict was reserved.
