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.

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. 

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले



REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 8486 OF 2011
M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH
ITS DIRECTOR SHRI PRADEEP KUMAR AGRAWAL                 APPELLANT (S)
VERSUS
GOVERNMENT OF N.C.T. OF DELHI THROUGH 
ITS PRINCIPAL SECRETARY (FINANCE) & ORS.       RESPONDENT (S)
WITH
CIVIL APPEAL NO. 8485/2011
CIVIL APPEAL NO. 8487/2011
CIVIL APPEAL NO. 8496­8501/2011
CIVIL APPEAL NO. 8502/2011
CIVIL APPEAL NO. 8617/2014
CIVIL APPEAL NO. 10374­10379/2014
CIVIL APPEAL NO. 8488/2011
CIVIL APPEAL NO. 8491­8494/2011
CIVIL APPEAL NO. 8495/2011
SPECIAL LEAVE PETITION (C) No. 33322/2017
J U D G M E N T
INDIRA BANERJEE J.
1. The main question raised in this batch of appeals is, whether, ‘Pan
Masala’, which contains tobacco and gutka, covered by an Entry in the
First   Schedule   to   the   Additional   Duties   of   Excise   (Goods   of   Special
1
Importance) Act 1957, hereinafter referred to as the ‘ADE Act’, are taxable
by the State under the Delhi Sales Tax Act 1975 and/or the Uttar Pradesh
Trade Tax Act 1948 and/or the Tamil Nadu General Sales Tax Act, 1959. 
2. In Shanti Fragrances v. Union of India and others1
, a Division
Bench of this Court observed:­
12. It does appear that there  is a direct conflict  between Kothari
Products [Kothari   Products   Ltd. v. State   of   A.P.,   (2000)   9  SCC
263], Radheshyam Gudakhu Factory [State of Orissa v. Radheshyam
Gudakhu   Factory,   (2018)   11   SCC   505   :   (1988)   68   STC   92   (SC)]
and Reliance   Trading   Co. [Reliance   Trading   Co. v. State   of   Kerala,
(2011) 15 SCC 762] judgments on the one hand, and Agra Belting
Works [CST v. Agra Belting Works, (1987) 3 SCC 140 : 1987 SCC
(Tax) 233] , which was also followed by two other judgments, on the
other.   We   may   hasten   to   add   that   there   are   three­Judge   Bench
decisions on both sides. ...”
3. The Bench further observed:­
“13. … One other interesting feature of this case is whether, after
Union of India v. Raghubir Singh2
, SCR at pp. 335­37 : SCC pp. 777­
78, para 27, it can be stated that Judges of this Court do not sit in 2s
and 3s for mere convenience, but that a Bench which is numerically
superior will prevail over a Bench of lesser strength. If the doctrine of
precedent, as applied by this Court, is to be a matter of numbers,
then, interestingly enough, as has been held by Beaumont, C.J. in
Ningappa Ramappa Kurbar v. Emperor3
, the position in law could be
as under: (AIR p. 409 : SCC OnLine Bom)
“…The Court in that case consisted of five Judges, one of whom,
Shah, J., dissented from that proposition. The authority of the case
may be open to question, since there had been a previous decision
of   a   Full   Bench   of   this   Court   of   four   Judges   in Queen
Empress v. Mugappa   Bin   Ningapa [Queen   Empress v. Mugappa
Bin   Ningapa,   ILR   (1893)   18   Bom  377]  ,   which   had  reached  a
different conclusion. Apparently it was considered that five Judges,
by a majority of four to one, could overrule a unanimous decision of
four Judges, the net result being that the opinion of four Judges
prevailed over the opinion of five Judges of co­ordinate jurisdiction.
There   seems   to   be   very   little   authority   on   the   powers   and
constitution of a Full Bench. There can be no doubt that a Full
1 (2018) 11 SCC 305
2 (1989) 2 SCC 754; (1989) 3 SCR 316
3 1941 SCC OnLine Bom 41 : AIR 1941 Bom 408
2
Bench can overrule a Division Bench, and that a Full Bench must
consist of three or more Judges; but it would seem anomalous to
hold that a later Full Bench can overrule an earlier Full Bench,
merely because the later Bench consists of more Judges than the
earlier. If that were the rule, it would mean that a Bench of seven
Judges, by a majority of four to three, could overrule a unanimous
decision of a Bench of six Judges, though all the Judges were of
co­ordinate   jurisdiction.   In Enatullah v. Kowsher
Ali [Enatullah v. Kowsher   Ali,   1926   SCC   OnLine   Cal   104   :   ILR
(1927)   54   Cal   266]   ,   Sanderson,   C.J.,   stating   the   practice   in
Calcutta, seems to have been of opinion that a decision of a Full
Bench could only be reversed by the Privy Council or by a Bench
specially constituted by the Chief Justice. Even if this be the true
rule, there is nothing to show that the Chief Justice acted upon it
in Emperor v. Purshottam   Ishwar   Amin [Emperor v. Purshottam
Ishwar Amin, 1920 SCC OnLine Bom 144 : ILR (1921) 45 Bom 834]
. I do not recollect myself ever to have constituted a Special Bench
to consider the ruling of a Full Bench, though I have constituted
many   Full   Benches   to   consider   rulings   of   Division   Benches.
However,  I  need  not  pursue  this  subject  further,  since,  for  the
purpose of the present appeal, I am prepared to assume that an
alternative charge of perjury lies, and that it was a charge of that
nature which the learned Additional Sessions Judge contemplated.
The question then is whether it is expedient in the interests of
justice that such a charge should be made.”
14. This conundrum was also addressed by M.B. Lokur, J. in Supreme
Court   Advocates­on­Record   Assn. v. Union   of   India [Supreme   Court
Advocates­on­Record   Assn. v. Union   of   India,   (2016)   5   SCC   1]   ,   as
follows: (SCC pp. 577­78, para 669)
“669. One of the more interesting aspects of Pradeep Kumar
Biswas [Pradeep Kumar Biswas v. Indian Institute of Chemical
Biology, (2002) 5 SCC 111 : 2002 SCC (L&S) 633] is that out of
the 7 (seven) learned Judges constituting the Bench, 5 learned
Judges overruled the unanimous decision of another set of 5
learned Judges in Sabhajit Tewary [Sabhajit Tewary v. Union of
India, (1975) 1 SCC 485 : 1975 SCC (L&S) 99] . Two of the
learned   Judges   in Pradeep   Kumar   Biswas [Pradeep   Kumar
Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC
111   :   2002   SCC   (L&S)   633]   found   that Sabhajit
Tewary [Sabhajit Tewary v. Union of India, (1975) 1 SCC 485 :
1975 SCC (L&S) 99] had been correctly decided. In other words,
while a total of 7 learned Judges took a particular view on an
issue of fact and law, that view was found to be incorrect by 5
learned Judges, whose decision actually holds the field today.
Is the weight of numbers irrelevant? Is it that only the numbers
in a subsequent Bench are what really matters? What would
have   been   the   position   if   only   4   learned   Judges   in Pradeep
Kumar   Biswas [Pradeep   Kumar   Biswas v. Indian   Institute   of
Chemical Biology, (2002) 5 SCC 111 : 2002 SCC (L&S) 633] had
decided to overrule Sabhajit Tewary [Sabhajit Tewary v. Union
3
of India, (1975) 1 SCC 485 : 1975 SCC (L&S) 99] while the
remaining 3 learned Judges found no error in that decision?
Would   a   decision   rendered   unanimously   by   a   Bench   of   5
learned Judges stand overruled by the decision of 4 learned
Judges in a subsequent Bench of 7 learned Judges? Pradeep
Kumar   Biswas [Pradeep   Kumar   Biswas v. Indian   Institute   of
Chemical Biology, (2002) 5 SCC 111 : 2002 SCC (L&S) 633]
presents   a   rather   anomalous   situation   which   needs   to   be
addressed by appropriate rules of procedure. If this anomaly is
perpetuated then the unanimous decision of 9 learned Judges
in Third Judges case [Special Reference No. 1 of 1998, In re,
(1998) 7 SCC 739] can be overruled (as sought by the learned
Attorney General) by 6 learned Judges in a Bench of 11 learned
Judges, with 5 of them taking a different view, bringing the total
tally of Judges having one view to 14 and having another view
to 6, with the view of the 6 learned Judges being taken as the
law!”
15.   It may be pointed out that in the present case, if numbers are
totted up, the Kothari Products [Kothari Products Ltd. v. State of A.P.,
(2000)   9   SCC   263]   line,   as   followed   in Radheshyam   Gudakhu
Factory [State   of   Orissa v. Radheshyam   Gudakhu   Factory,   (2018)   11
SCC 505 : (1988) 68 STC 92 (SC)] and Reliance Trading Co. [Reliance
Trading Co. v. State of Kerala, (2011) 15 SCC 762] , will go to a Bench
strength, numerically speaking, of eight learned Judges, as against
the Agra Belting Works [CST v. Agra Belting Works, (1987) 3 SCC 140 :
1987 SCC (Tax) 233] line, which goes up to a numerical strength of six
learned Judges. If the dissenting judgment of B.C. Ray, J. is to be
added   to   the Kothari   Products [Kothari   Products   Ltd. v. State   of   A.P.,
(2000) 9 SCC 263] line, then we have a numerical strength of 9:6. The
question of numerical strength gains poignancy when one judgment is
overruled   by   another,   as   has   been   pointed   by   Beaumont,   C.J.
in Ningappa Ramappa Kurbar [Ningappa Ramappa Kurbar v. Emperor,
1941 SCC OnLine Bom 41 : AIR 1941 Bom 408] , and by Lokur, J.
in Supreme Court Advocates­on­Record Assn. [Supreme Court Advocateson­Record Assn. v. Union of India, (2016) 5 SCC 1]”
4. The   two­Judge   Bench,   referred   to   the   Constitution   Bench,   the
following questions:
i) Whether   the  Kothari   Products   Ltd.   v.   State   of   A.P.4
  line   of
judgments or the Central Sales Tax vs. Agra Belting Work5
, line
of judgments is correct in law; and
4 (2000) 9 SCC 263
5 (1987) 3 SCC 140
4
ii) What should be the proper guidelines for the future for overruling
an earlier decision of this Court, and to what extent should the
Courts   be   guided   by   the   propositions   in  Ningappa   Ramappa
Kurbar   v.   Emperor6
, the observations of Lokur, J. in  Supreme
Court   Advocates­on­Record   Assn.   v   Union   of   India7
  and   the
judgment   of   the   Court   of   Appeal   in  Harper   v.   National   Coal
Board8
5. The ADE Act has been enacted to provide for the levy and collection
of additional duties of excise in respect of certain goods, over and 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 of excise in
replacement of the sales taxes levied by the Union and States on
sugar, tobacco and mill­made textiles and to distribute the net
proceeds of these taxes, except the proceeds attributable to Union
Territories, to the States.   The distribution of the proceeds of the
additional duties broadly follows the pattern recommended by the
Second Finance Commission.   Provision has been made that the
States   which   levy   a   tax   on   the   sale   or   purchase   of   these
commodities after 1.4.1958 do not participate in the distribution of
the net proceeds.   Provision is also being made in the Bill for
including these three goods in the category of goods declared to be
of special importance in inter­State trade or commerce so that,
following the imposition of uniform duties of excise on them, the
rates of sales tax if levied by any State are subject from 1.4.1958
to the restrictions in 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 substitute additional
duties of excise in place of sales tax so far as these goods were
concerned.   Since the State legislatures were at liberty, if they
wished,   to   levy   taxes   on   the   sale   or   purchase   of   these
6 1941 SCC Online Bom 41 : Air m1941 Bom 408
7 (2016) 5 SCC 1
8 [1974] QB 614
9 (1989) 1 SCC 164
5
commodities, the Act provided that the additional excise duties will
be distributed only among such States as did not levy a tax on the
sale or purchase of these commodities.   Also, by including these
goods in the category of goods declared to be of special importance
in inter­State trade or commerce, the legislation ensured that, if
any State levied sales tax in respect of these commodities, such
levy was subject to the restrictions contained in the Central Sales
Tax Act, 1956.”
7. It is well settled that once goods are chargeable under the ADE Act,
the   State   cannot   levy   sales   tax   on   the   same   goods   under   a   State
enactment.  In Godfrey Phillips India Ltd. v. State of U.P10
., this Court
held:­
“70.  So even if tobacco is an article of luxury, a tax on its supply is
within the exclusive competence of the State but subject to the
constitutional   curbs   prescribed   under   Article   286   read   with
Sections 14 ad 15 of the Central Sales Tax Act, 1956 and most
importantly the ADE Act of 1957 under which no sales tax can be
levied on tobacco at all if the State was to take 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 exempted from Sales
Tax under Section 8 of the Andhra Pradesh General Sales Tax Act 1957,
whether ‘gutka’ could be taxed by the State of Andhra Pradesh.  The Court
found   that   “gutka”   being   tobacco,   covered   by   an   Entry   in   the   First
Schedule to the ADE Act and liable to be taxed under the ADE Act, it was
covered by the exemption in Section 8 of the Andhra Pradesh General
Sales Tax Act .   The State Act could not have been amended to tax
“gutka”. 
10 (2005) 2 SCC 515
6
9. There is a line of decisions of this Court, taking the same view as
Kothari   Products  Ltd.  (supra)  and holding that items covered by the
expression ‘tobacco’ and other items included in the First Schedule to the
ADE Act are not taxable by the State. 
10. In the  State  of  Orrisa  vs.  Radhey  Shyam  Gudakhu  Factory11
,
the issue was whether Gudakhu was covered by the expression ‘tobacco’
as defined in Section 2(c) of ADE Act.   Following the decision of the
Calcutta   High   Court   in  Gulabchand   Harekchand   v.   State   of  West
Bengal12
,  this Court held that Gudakhu is a product of ‘tobacco’ and
hence, a product which falls within the exemption covered by S. No. 35 of
the Schedule to the Orissa Sales Tax Act 1947.  
11. In Reliance Trading Company, Kerala v. State of Kerala13, this
Court took the view that cotton based tarpaulin was exempted from Sales
Tax under the Kerala General Sales Tax Act, 1963, since it was exigible to
Additional Excise Duty under the First Schedule of  the ADE Act.  
12. In Agra Belting Works (supra), the question was whether any class
of goods – cotton fabrics of all kinds, to be specific, exempted from 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 Notification under
11 (2018) 11 SCC 505
12 1984 SCC Online Cal 274
13 (2011) 15 SCC 762
7
Section 3­A of the said Act, specifying the rate of sales tax in respect of an
item of the class of goods exempted under Section 4, without withdrawing
the earlier Notification under Section 4.   While the majority held that a
Notification   of   recall   of   exemption   was   not   a   condition   precedent   for
imposition of tax, by a valid Notification under Section 3­A, B.C.Ray, J.
dissented with the view of the majority. 
13. In  Agra   Belting  Works  (supra), the majority of the three­Judge
Bench of this Court, by ratio of 2:1, inter alia, held:­
“6.  As   has   been   pointed   out   above,   Section   3   is   the   charging
provision; Section 3­A authorises variation of the rate of tax and
Section 4 provides for exemption from tax. All the three sections are
parts of the taxing scheme incorporated in the Act and the power
both under Section 3­A as also under Section 4 is exercisable by
the State Government only. When after a notification under Section
4 granting exemption from liability, a subsequent notification under
Section 3­A prescribes the rate of tax, it is beyond doubt that the
intention is to withdraw the exemption and make the sale liable to
tax at the rate prescribed in the notification. As the power both for
the grant of exemption and the variation of the rate of tax vests in
the State Government and it is not the requirement of the statute
that a notification of recall of exemption is a condition precedent to
imposing tax at any prescribed rate by a valid notification under
Section 3­A, we see no force in the contention of the assessee
which has been upheld by the High Court. In fact, the second
notification can easily be treated as a combined notification — both
for withdrawal of exemption and also for providing higher tax.
When power for both the operations vests in the State and the
intention to levy the tax is clear we see no justification for not
giving effect to the second notification. We would like to point out
that the exemption was in regard to a class of goods and while the
exemption continues, a specific item has now been notified under
Section 3­A of the Act.”
14. B.C. Ray, J. dissenting with the majority view, held:­ 
“14. The next question for consideration is what is the effect of a
notification under Section 3­A including an item in the Schedule for
8
imposition of sales tax though there is a general exemption from
sales tax under Section 4 of the Sales Tax Act. 
15. A similar question also arose in the case of CST v. Rita Ice
Cream Co., Gorakhpur [1981 UPTC 1239 (DB)(All HC)] and it was
held   that   so   long   as   the   general   exemption   under   Section   4
continues a particular item notified under Section 3­A of Sales Tax
Act cannot be taxed.
16. On  a   conspectus   of   all   these   decisions   aforesaid,   the   only
irresistible inference follows that so long as the general exemption
granted under Section 4 with regard to cotton fabrics of all kinds
continues no sales tax can be imposed on beltings of all kinds
which fall within the cotton fabrics of all kinds and the general
exemption under Section 4 will prevail over the notification made
under Section 3­A of the Sales Tax Act. I am unable to subscribe to
the view that since the notification under Section 3­A of the U.P.
Sales Tax Act has been made subsequent to the notification issued
under Section 4 of the said Act, the subsequent notification under
Section 3­A will prevail over the general exemption granted under
Section 4 of the said Act. In my considered opinion the reasonings
and conclusions arrived at by the High Court are unexceptionable.”
15. In  Sales   Tax   Officer,   Sector­IX,   Kanpur   vs.     Dealing   Dairy
Products   and   Anr.14,  a  two Judge  Bench of this  Court  followed  the
majority decision in  Agra   Belting  Works  (supra),  and held that, even
though the State of Uttar Pradesh had been issuing notifications under
Section   4   of   the   U.P.   Sales   Tax   Act   1948,   exempting   milk   and   milk
products from levy of sales tax, a later notification under Section 3­A
notifying the rate of tax on ice­cream amongst other items, withdrew the
exemption in respect of all kinds of ice­cream and made the sale of  icecream exigible to sales tax at the rate specified in the Notification under
Section 3A.  
14 (1994) Supp. 2 SCC 639
9
16. In  State   of   Bihar  and   Others   v.   Krishna   Kumar  Kabra  and
Another15, a two Judge Bench of this Court referred to and followed Agra
Belting  Works  (supra) and  Dealing  Dairy  Products  (supra)  and held
that Sections 3­A and 4 of the U.P. Sales Tax Act were parts of a taxing
scheme incorporated in that Act and therefore, where the notification was
issued under Section 3­A prescribing the rate of tax on goods, which had
been exempted from tax under Section 4, by an earlier notification, it had
to   be   held   that   the   later   notification   was   intended   to   withdraw   the
exemption and make the sale leviable to tax at the rate prescribed in the
later notification.
17. In our considered opinion there is no conflict between the Kothari
Products  (supra) line of cases and the Agra Belting line of cases.  The
Kothari  Products  (supra)  line of cases was on the question of whether
“tobacco” or other goods specified in the First Schedule to the ADE Act
and hence exempted from Sales Tax under State sales tax enactments,
can be made exigible to tax under the State enactments by amending the
Schedule thereto.  On the other hand, Agra Belting Works (supra) line of
cases was on the question of interplay between general exemption of
specified goods from sales tax under Section 4 of the U.P. Sales Tax Act
and specification of rates of sales tax under Section 3­A of the said Act.
This Court held that goods exempted from sales tax under Section 4
would be exigible to tax by virtue of subsequent notification under Section
3­A specifying the rate of sales tax for any specific item of the class of
15 (1997) 9 SCC 763
10
goods earlier exempted under Section 4.     There being no conflict, the
reference to Constitution Bench is incompetent.  The cases may be placed
for decision before the regular Bench. 
18. The   second   question   is   answered   by   the   judgment   of   the
Constitution Bench of this Court in Dr. Jaishri Laxmanrao Patil     v.
The   Chief  Minister  and  Others.16.   The Constitution Bench speaking
through Bhat, J. held:­ 
“10. A careful reading of the judgments in Indra Sawhney v. Union
of   India [Indra   Sawhney v. Union   of   India,   1992   Supp   (3)   SCC
217 : 1992 SCC (L&S) Supp 1] , clarifies that seven out of nine
Judges   concurred   that   there   exists   a   quantitative   limit   on
reservation—spelt   out   at   50%.   In   the   opinion   of   four   Judges,
therefore, per the judgment of B.P. Jeevan Reddy, J., this limit
could   be   exceeded   under   extraordinary   circumstances   and   in
conditions for which separate justification has to be forthcoming by
the State or the agency concerned. However, there is unanimity in
the   conclusion by   all   seven   Judges   that   an   outer   limit   for
reservation should be 50%. Undoubtedly, the other two Judges,
Ratnavel Pandian and P.B. Sawant, JJ. indicated that there is no
general rule of 50% limit on reservation. In these circumstances,
given the general common agreement about the existence of an
outer limit i.e. 50%, the petitioner's argument about the incoherence
or uncertainty about the existence of the rule or that there were
contrary observations with 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 of S.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   Kumar v. State   of
Karnataka, 1985 Supp SCC 714 : 1985 Supp (1) SCR 352] ) is not
an   argument   compelling   a   review   or   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 in different
subjects   (Devadasan [T.   Devadasan v. Union   of   India,   (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
16 (2021) 8 SCC 1
11
Sawhney [Indra Sawhney v. Union of India, 1992 Supp (3) SCC
217 : 1992 SCC (L&S) Supp 1] ) should lead to re­examination of
the ratio in Indra Sawhney [Indra Sawhney v. Union of India, 1992
Supp (3) SCC 217 : 1992 SCC (L&S) Supp 1] . It would be useful to
notice   that   unanimity   in   a   given   Bench   (termed   as   a   “super
majority”) — denoting a 5 : 0 unanimous decision in a Constitution
Bench cannot be construed as per se a strong or compelling reason
to doubt the legitimacy of a larger Bench ruling that might contain
a narrow majority (say, for instance with a 4 : 3 vote, resulting in
overruling of a previous unanimous precedent). The principle of
stare decisis operates both vertically — in the sense that decisions
of   appellate   courts   in   the   superior   in   vertical   hierarchy,   bind
tribunals and courts lower in the hierarchy, and horizontally — in
the sense that a larger Bench formation ruling, would be binding
and prevail upon the ruling of a smaller Bench formation. The logic
in this stems from the raison d'être for the doctrine of precedents
i.e. stability in the law. If this rule were to be departed from and
the  legitimacy  of a  subsequent  larger  Bench ruling were  to  be
doubted   on   the   ground   that   it   comprises   of   either   plurality   of
opinions or a narrow majority as compared with a previous Bench
ruling (which might be either unanimous or of a larger majority, but
of lower Bench strength), there would be uncertainty and lack of
clarity   in   the   realm   of   precedential   certainty.   If   precedential
legitimacy of a larger Bench ruling were thus to be doubted, there
are no rules to guide the courts' hierarchy or even later Benches of
the   same   court   about   which   is   the   appropriate   reading   to   be
adopted (such as for instance, the number of previous judgments
to be considered for determining the majority, and consequently
the correct law).
12. In view of the above reasoning, it is held that the existence of a
plurality of opinions or discordant or dissident judgments in the
past — which might even have led to a majority (on an overall
headcount) supporting a particular rule in a particular case cannot
detract from the legitimacy of a rule enunciated by a later, larger
Bench,   such   as   the   nine­Judge   Bench   ruling   in Indra
Sawhney [Indra Sawhney v. Union of India, 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 a majority of the
judges at the hearing will be considered as a judgment or opinion of the
Court.  It is settled that the majority decision of a Bench of larger strength
12
would prevail over the decision of a Bench of lesser strength, irrespective
of the number of Judges constituting the majority. 
20. In view of the five­Judge Bench decision in  Dr.  Jaishri  Laxman
Rao (supra), it is not necessary for this Court to answer the question.
….……………………………………. J.
[INDIRA BANERJEE]
   ………..……………………………… J.
[SURYA KANT]
   ………..……………………………… J.
         [M.M. SUNDRESH]
   ………..……………………………… J.
[SUDHANSHU DHULIA]
NEW DELHI;
SEPTEMBER 19, 2022
13
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 8486 OF 2011
M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH
ITS DIRECTOR SHRI PRADEEP KUMAR AGRAWAL .....APPELLANT(S)
VERSUS
GOVT OF N.C.T OF DELHI THROUGH ITS
PRINCIPAL SECRETARY (FINANCE) & ORS. .....RESPONDENT(S)
W I T H
CIVIL APPEAL NO. 8485 OF 2011
CIVIL APPEAL NO. 8487/2011
CIVIL APPEAL NOS. 8496-8501/2011
CIVIL APPEAL NO. 8502/2011
CIVIL APPEAL NO. 8617/2014
CIVIL APPEAL NOS. 10374-10379/2014
CIVIL APPEAL NO. 8488/2011
CIVIL APPEAL NOS. 8491-8494/2011
1
CIVIL APPEAL NO. 8495/2011
SLP(C) NO. 33322/2017
J U D G M E N T
HEMANT GUPTA, J.
A. I entirely agree with the judgment authored by Hon. Indira Banerjee J. However,
in respect of Question No.2, I would like to supplement the opinion expressed.
B. Mr. Gopal Sankaranarayanan, learned Senior Advocate referred to Article 145(5)
of the Constitution to contend that a judgment of this Court is mandated to be
delivered with the concurrence of a majority of the Judges present at the
hearing of the case, but nothing in this clause shall be deemed to prevent a
Judge who does not concur from delivering a dissenting judgment or opinion.
Thus, the Constitution itself envisaged that the judgment is by the majority of
the Judges.
C. A reference was made to insertion of Article 144A in the Constitution by the 42nd
Amendment with effect from 01.02.1977. The amendment reads thus:
“144-A. Special provisions as to disposal of questions relating to
constitutional validity of laws – (1) The minimum number of Judges
of the Supreme Court who shall sit for the purpose of determining
any question as to the constitutional validity of any Central law or
State law shall be seven.
A. A Central law or a State law shall not be declared to be
constitutionally invalid by the Supreme Court unless a majority of
not less than two-thirds of the Judges sitting for the purpose of
determining the question as to the constitutional validity of such
law hold it to be constitutionally invalid.”
2
D. The said amendment was undone by 43rd Amendment when Article 144-A was
omitted with effect on and from 01.02.1977. Though the said insertion of Article
144-A stands repealed, but it shows that the legislature also considered majority
of not less than 2/3rd of Judges should determine 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 the High Court of
Gujarat in a judgment reported as State of Gujarat v GordhandasKeshavji
Gandhi and Ors.
17. The Court was considering the binding nature of the
judgments of the Bombay High Court in the successor Gujarat High Court but an
ancillary question was considered in respect of numerical strength of the Bench
as well. Though there is divergence of opinion amongst the judges of the Court,
but the minority view was relevant for the second question arising for
consideration. The minority view is expressed by N.M. Miabhoy J and
P.N.Bhagwati J. We are in agreement with the said view. The order passed by
learned Hon’ble Mr. Justice N.M. Miabhoy J reads thus:
“44. ……………The principles which guided the latter Court in the
matter of judicial precedents have been set out by that Court in
(1944) 1 KB 718. All Division Benches considered themselves to be
bound by the judicial precedents created by Full Benches not only
on the ground of judicial comity but also on the ground that a Full
Bench consisted of more number of Judges than a Division Bench. If
a judicial precedent created by a Full Bench required to be
reconsidered, then, the usual practice was to refer the matter to a
Full Bench consisting of more number of Judges than the number
which constituted the former Full Bench whose decision was sought
to be revised. The practice was to regard the precedent of a larger
Full Bench as having greater efficacy and binding authority than
the precedent of a Full Bench consisting of a smaller number of
Judges. This practice was criticised by Beaumont, C.J. in 43 Bom LR
864 at p. 868 : (AIR 1941 Bom 408 at p. 409). It is not necessary to
express any opinion in this case as to whether this criticism was or
was not justified. However, the observations made by the learned
17 AIR 1962 Guj 128
3
Chief Justice in the above case ignores the important fact that,
when a Full Bench consists of a larger number of Judges, then, the
decision is not merely of a greater number of Judges, but it is one
arising from out of the joint deliberations and discussions of a
greater number of Judges and that this fact may give to the
decision of a Full Bench consisting of a larger number of Judges a
greater binding authority than that of a Full Bench consisting of a
smaller number of Judges…………….. In view of the observations
made by Their Lordships of the Supreme Court in the aforesaid two
cases18, the view that should prevail in India is the view-that the
decision of a larger Full Bench should be followed in preference to
the decision of a smaller Full Bench.
xxx xxx xxx
The order passed by learned Hon’ble Mr. Justice P.N.Bhagwatireads thus:-
xxx xxx xxx
117. ……………………Is the subsequent Full Bench of the High Court
bound to follow the decision of the previous Full Bench of the High
Court, though the previous Full Bench consisted of a lesser number
of Judges than the subsequent Full Bench? The question ultimately
resolves itself into a narrow one, namely, how far the principle of
superiority of numerical strength should be carried. If the principle
of superiority of numerical strength is applied to Full Benches of the
High Court whatever be the numerical strength of the Judges
constituting the Full Benches, a Full Bench of four Judges would be
able to override the previous decision of a Full Bench of three
Judges, a Full Bench of five Judges would be able to override the
previous decision of a Full Bench of four Judges and so on and so
forth. Beaumont, C.J., expressed a doubt 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 a
majority of four to one, could overrule a unanimous decision
of four Judges, the net result being that the opinion of four
Judges prevailed over the opinion of five Judges of coordinate jurisdiction. There seems to be very little authority
18(1) AIR 1960 SC 936
(2) AIR 1960 SC 1118
4
on the powers and constitution of a Full Bench.-There can be
no doubt that a Full Bench can overrule a Division Bench, and
that a Full Bench must consist of three or more Judges; but it
would seem anomalous to hold that a later Full Bench can
Overrule an earlier Full Bench, merely because the later
bench consists of more Judges than the earlier. If that were
the rule, it would mean that a Bench of seven Judges, by a
majority of four to three, could overrule a unanimous
decision of a Bench of six Judges, though all the Judges were
of co-ordinate jurisdiction.”
.......................... It was the anomaly of this situation which
prompted Beaumont, C.J., to make the aforesaid observations. This
anomaly is, however, inherent in the principle of superiority of
numerical strength and should not stand in the way of acceptance
of that principle in its application to Full Benches of the High Court.
The same anomaly also arises when four or five Judges of the High
Court, each sitting singly take one view of the law on a particular
point while a Division Bench consisting of two Judges takes a
different view or when three or four Division Benches, each
consisting of two Judges, take one view on a point of law while a
Full Bench of three Judges takes a different view. The opinion of two
Judges prevails over the opinion of four or five Judges in the former
case while in the latter case the opinion of three Judges prevails
over the opinion of eight or ten Judges, though all the Judges are of
co-ordinate jurisdiction. This anomaly cannot, therefore, be a valid
argument against the application of the principle of superiority of
numerical strength amongst Full Benches of the High Court. The
principle of superiority of numerical strength is a principle which, as
I have already pointed out above, imparts flexibility to the law and
provides an easy machinery within the framework of the High Court
itself for correction of erroneous decisions which would otherwise
stand inviolate, immune from challenge except on appeal to the
Supreme Court.” (Emphasis Supplied)
F. It may be mentioned that a Constitution Bench of this Court in a judgment
reported as Central Board of Dawoodi Bohra Community and Anr. v.
State of Maharashtra and Anr.
19
 quoted from the earlier Constitution Bench
19 (2005) 2 SCC 673
5
judgment in Union of India and Anr. v. Raghubir Singh (Dead) By Lrs.
Etc.
20and held as under:
“10. Reference was also made to the doctrine of stare decisis. His
Lordship observed by referring to Sher Singh v. State of
Punjab [(1983) 2 SCC 344 : 1983 SCC (Cri) 461] that although the
Court sits in divisions of two and three Judges for the sake of
convenience but it would be inappropriate if a Division Bench of
two Judges starts overruling the decisions of Division Benches of
three. To do so would be detrimental not only to the rule of
discipline and the doctrine of binding precedents but it will also
lead to inconsistency in decisions on points of law; consistency and
certainty in the development of law and its contemporary status —
both would be immediate casualty.
xxx xxx
12. Having carefully considered the submissions made by the
learned Senior Counsel for the parties and having examined the
law laid down by the Constitution Benches in the abovesaid
decisions, we would like to sum up the legal position in the
following terms:
(1) The law laid down by this Court in a decision delivered by a
Bench of larger strength is binding on any subsequent Bench of
lesser or coequal strength.
(2) A Bench of lesser quorum cannot disagree or dissent from the
view of the law taken by a Bench of larger quorum. In case of doubt
all that the Bench of lesser quorum can do is to invite the attention
of the Chief Justice and request for the matter being placed for
hearing before a Bench of larger quorum than the Bench whose
decision has come up for consideration. It will be open only for a
Bench of coequal strength to express an opinion doubting the
correctness of the view taken by the earlier Bench of coequal
strength, whereupon the matter may be placed for hearing before
a Bench consisting of a quorum larger than the one which
pronounced the decision laying down the law the correctness of
which is doubted.
20 (1989) 2 SCC 754
6
(3)...........................”
G. The conclusion (1) is that a decision delivered by a Bench of largest strength is
binding on any subsequent Bench of lesser or coequal strength. It is the
strength of the Bench and not number of Judges who have taken a particular
view which is said to be relevant. However, conclusion (2) makes it absolutely
clear that a Bench of lesser quorum cannot disagree or dissent from the view of
law taken by a Bench of larger quorum. Quorum means the bench strength
which was hearing the matter.
H. Thus, it has been rightly concluded that the numerical strength of the Judges
taking a particular view is not relevant, but the Bench strength is determinative
of the binding nature of the Judgment.
.............................................J.
(HEMANT GUPTA)
NEW DELHI;
SEPTEMBER 19, 2022.
7

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