Pramod Shroff Vs Mohan Singh Chopra - In the light of the above legal precedents, it can be said that though the framing of issues in an ex parte suit is not mandatory by virtue of Order XIV Rule 6 of CPC, but the judgment must be in conformity with the provisions of the Code. Thus, Order XX Rule 4 of CPC comes into picture.

 SCI (2026.04.09) in Pramod Shroff Vs Mohan Singh Chopra  [2026 INSC 378, CIVIL APPEAL NO.              OF 2026 (ARISING OUT OF SLP (C) NO.20779 OF 2025) ] held that;-

• Order XX Rule 4(2) states that judgments of Courts shall contain a concise statement of the case, the points for determination, the decision thereon, and the reasons for such decision.

• Further, it held that in a case which has proceeded ex parte, the court is not bound to frame issues under Order XIV and deliver the judgment on every issue as required by Order XX Rule 5. Yet the trial court should scrutinize the available pleadings and documents, consider the evidence adduced, and would do well to frame the “points for determination” and proceed to construct the ex parte judgment dealing with the points at issue one by one.

•  Furthermore, this Court in Maya Devi v. Lalta Prasad [(2015) 5 SCC 588], has held that in case the Defendant has been proceeded against ex parte, it is the duty of the court to pass the decree only after ascertaining the factual and legal veracity of the claim of the Plaintiff.

• What a judgment should contain is indicated in Order XX Rule 4(2) which says that a judgment ‘shall contain a concise statement of the case, the points for determination, the decision thereon, and the reasons for such decision.

• the Apex Court explained that ‘points for determination’ in Rule 4(1) are obviously nothing but ‘issues’ contemplated by Rules 1 and 3 of Order XIV. In practice, the trial court first frames issues (points of controversy) after examination of pleadings, the judgment then recites these as “points for determination” and answers them.

• The court must give its finding on each point. Order XX Rule 5 CPC further reinforces this: if issues have been framed in the suit, the court “shall state its finding or decision, with reasons, upon each separate issue”, unless deciding one issue resolves the suit. Thus, points for determination ensure that every controverted issue is  addressed. A judgment that omits discussion of issues in dispute is defective.

• Points for determination are the court’s restatement of the disputed questions (issues) that were placed before it, and the judgment must answer each. They serve to concentrate the court’s reasoning and ensure completeness of adjudication.

•  In Sayeda Akhtar v. Abdul Ahad [ (2003) 7 SCC 52], it was held that omission to frame an important issue may sometimes cause prejudice to parties resulting in failure to lead evidence on the point.

•  In the light of the above legal precedents, it can be said that though the framing of issues in an ex parte suit is not mandatory by virtue of Order XIV Rule 6 of CPC, but the judgment must be in  conformity with the provisions of the Code. Thus, Order XX Rule 4 of CPC comes into picture.

Excerpts of the Order;

# 1. Leave granted.

# 2. The present appeal raises an important question touching upon the procedural obligations of a civil court while adjudicating a suit ex parte, and more particularly, whether the absence of formal framing of issues vitiates such proceedings, and what constitutes a    legally sustainable judgment in such circumstances.

# 3. The appeal before the High Court was heard ex parte. The Respondent, despite service, chose not to enter appearance before the courts below or before this Court. On 05.12.2025, Mr. Anup Kumar, learned Counsel, who was present in the Court was appointed as Amicus Curiae to assist this Court in this matter. He was directed to get in touch with Respondent directly in writing, apprise him about pendency of present appeal, his right to engage a counsel of his choice and his right of being represented through a legal aid counsel. Having done so, still the Respondent remains unrepresented.

# 4. The instant appeal assails the judgment and order dated 21.01.2025 (hereinafter referred as “Impugned Judgment”) passed by the High Court of Calcutta (hereinafter referred as “High of 2018 filed by the Appellant (Plaintiff) herein and affirmed the judgment and decree dated  26.10.2017 passed by the City Civil Court at Calcutta (hereinafter referred as “trial court”), vide which suit filed by the Appellant for specific performance for agreement to sell was dismissed ex parte.

# 5. The brief facts are that the original owner of the property executed a 75 years lease in favour of the Khimjis. Thereafter, Khimjis constructed a building on the said property by the name of “Shalimar Apartments”. During construction, the Khimjis entered into a partnership with other persons under the name and style of Gulmohar Properties to complete the construction and sell out the flats therein on ownership basis including, Flat No. 61 in the Shalimar Apartments lying and situate at 42-B, Shakespeare Sarani, Kolkata-700017, along with a car parking space (hereinafter referred as “the suit property”).

# 6. Later, Gulmohar Properties executed an agreement for sale in relation to the suit   property, in favour of the Balwanis, with a clause for assignment.

# 7. Pursuant to assignment clause, the Balwanis transferred the property to Mohan Singh Chopra (Respondent-defendant) by a tripartite registered sale deed, in which Gulmohar Properties, the Balwanis and the Respondent were signatories.

# 8. On 27.01.1977, agreement for sale relating to suit property was executed between Respondent as Vendor and Appellant as Vendee in consideration of ₹95,000/- out of which ₹90,000/- was paid with an undertaking that balance of ₹5,000/- would be paid on the date of execution of Deed of Conveyance and presentation of the same before the Registrar of Assurance. Appellant was also put into the possession of the suit property. Respondent also handed over the original documents, indenture, Title Deeds etc. to the Appellant. On various occasions request was made to the  Respondent to execute the Conveyance Deed by the Appellant but the same did not fructify.

# 9. The Appellant, with a grievance that despite repeated requests Respondent neither accepted balance amount of ₹5,000/- nor executed Deed of Conveyance in his favour, filed a suit for specific performance for agreement to sell dated 27.01.1977 against the Respondent (Defendant) in relation to the suit property.

# 10. The courts below rejected the claim of the Appellant on the ground that Appellant failed to prove the title of the Respondent in the suit property.

# 11. The counsel for Appellant submitted that since no issue qua the title of the Respondent was framed, the onus to prove the same did not fall on the Appellant and the Appellant was not put to notice of the said issue and therefore could not be expected to lead evidence in support of the same. Both the Courts below have disregarded the procedure prescribed i.e., for issues to be framed before trial, as the same  puts the parties to notice of the facts that are required to be proved in a given case.

# 12. Having heard the learned Counsel for the Appellant, learned Amicus Curiae, and considering the written submissions filed by the Appellant and learned Amicus Curiae, we find it apposite that prior to undertaking and answering the aforementioned submissions as raised, it is imperative to delve into the statutory provisions as well as the existing jurisprudence as developed by this Court while dealing with such provisions relatable to what are the essential requirements of a valid judgment in an ex parte civil suit? And whether the courts below have discharged their obligation in accordance with law while deciding the suit ex parte?

# 13. Sub-section 9 of the section 2 of the Civil Procedure Code, 1908 (hereinafter referred as “CPC”) provides that "judgment" means the statement given by the Judge of the grounds of a decree or order.

# 14. Section 2(2) of the CPC provides that "decree" means the formal expression of an adjudication which, so far as regards the court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final.

# 15. Order XIV Rule 1(6) explicitly provides that framing of issues is not required where the defendant at the first hearing of the suit makes no defense.

# 16. Order XX Rule 4(2) states that judgments of Courts shall contain a concise statement of the case, the points for determination, the decision thereon, and the reasons for such decision.

• “ORDER XX

• 4. Judgments of Small Cause Courts.—(1) Judgments of a Court of Small Causes need not contain more than the points for determination and the decision thereon.

• (2) Judgments of other Courts.—Judgments of other Courts shall contain a concise statement of the case, the points for determination, the decision thereon, and the reasons for such decision.”

# 17. Though, the framing of issues where defendant does not present a defense is not mandated, still the importance of framing of issues cannot be underscored. This Court in the case of Makhan Lal Bangal v. Manas Bhunia and Others [(2001) 2 SCC 652], while stressing upon the importance of framing of issues held it as an imperative stage in any civil proceedings as it narrows down the scope of trial by separating wheat from the chaff. Therefore, the real dispute between the parties is determined and the conflict between the parties is narrowed. The petition may be disposed of at the first hearing if it appears that the parties are not at issue on any material question of law or of fact and the Court may at once pronounce the judgment.

# 18. Further, in Ramesh Chand Ardawatiya v.Anil Panjwani [(2003) 7 SCC 350], it has been opined that the burden of proof on the Plaintiff is not too heavy in ex parte civil suits. The Plaintiff, however, must show prima-facie proof qua the existence of relevant facts and circumstances out of which the cause of action has arisen. Therefore, evincing that the court proceeds to record evidence of the Plaintiff qua the cause of action and accordingly decrees the suit. Further, it held that in a case which has proceeded ex parte, the court is not bound to frame issues under Order XIV and deliver the judgment on every issue as required by Order XX Rule 5. Yet the trial court should scrutinize the available pleadings and documents, consider the evidence adduced, and would do well to frame the “points for determination” and proceed to construct the ex parte judgment dealing with the points at issue one by one.

# 19. Furthermore, this Court in Maya Devi v. Lalta Prasad [(2015) 5 SCC 588], has held that in case the Defendant has been proceeded against ex parte, it is the duty of the court to pass the decree only after ascertaining the factual and legal veracity of the claim of the Plaintiff.

# 20. This Court while considering the essential requirements of a judgment in Balraj Taneja and Another v. Sunil Madan and Another [(1999) 8 SCC 396] has held that Judgment as defined in Section 2(9) of the CPC means the statement given by the Judge of the grounds for a decree or order. What a judgment should contain is indicated in Order XX Rule 4(2) which says that a judgment ‘shall contain a concise statement of the case, the points for determination, the decision thereon, and the reasons for such decision. It should be a self-contained document from which it should appear as to what were the facts of the case and what was the controversy which was tried to be settled by the court and in what manner.

“Points for Determination” – Meaning and Role

# 21. The points for determination in a judgment are essentially the legal and factual issues the court must resolve. They correspond to the issues framed during trial (Order XIV), but   in the judgment they are stated as the point(s) to be decided. In Rameshwar Dayal v. Banda (dead) through his LRs and Another [(1993) 1 SCC 531], the Apex Court explained that ‘points for determination’ in Rule 4(1) are obviously nothing but ‘issues’ contemplated by Rules 1 and 3 of Order XIV. In practice, the trial court first frames issues (points of controversy) after examination of pleadings, the judgment then recites these as “points for determination” and answers them. These points focus the judgment on the exact matters in controversy between the parties. By explicitly listing points, the judgment guides the parties and the Appellate court to see what questions were in contest. The court must give its finding on each point. Order XX Rule 5 CPC further reinforces this: if issues have been framed in the suit, the court “shall state its finding or decision, with reasons, upon each separate issue”, unless deciding one issue resolves the suit. Thus, points for determination ensure that every controverted issue is  addressed. A judgment that omits discussion of issues in dispute is defective. It was held that a Small Causes Court judgment which has not even stated the points for determination and given a finding thereon, is obviously not a judgment within the meaning of Section 2(9) of CPC.

# 22. Points for determination are the court’s restatement of the disputed questions (issues) that were placed before it, and the judgment must answer each. They serve to concentrate the court’s reasoning and ensure completeness of adjudication.

# 23. Even when a defendant fails to appear or file a written statement, the court cannot dispense with the points for determination altogether. In Balraj Taneja (supra), it was argued that if no written statement is filed the facts as set out in the plaint would be deemed to be admitted and thus, the court need not indicate the points. This Court while rejecting this submission held that ‘whether it is a case which is contested by  the defendants by filing a written statement, or a case which proceeds ex parte and is ultimately decided as an ex parte case, or is a case in which the written statement is not filed and the case is decided under Order VIII Rule 10, the court has to write a judgment which must be in conformity with the provisions of the Code or at least set out the reasoning by which the controversy is resolved’. In other words, even in default or ex parte suits, the court should identify the legal points (even if obvious) and give a reasoned answer. Simply granting a decree on default is not enough under Section 2(9) of CPC doing so would be a “material irregularity”. Thus, points should be framed (or recited from existing pleadings) and addressed regardless of default.

# 24. The true scope for framing issues is that evidence let in on issue on which the parties actually went to trial should not be the foundation for decision of another and different issue, which was not present to the minds of the parties and on which they had no opportunity   of adducing evidence. But that rule has no application to a case where the parties go to a trial with knowledge that a particular question is in issue, though no specific issue has been framed thereon and adduce evidence relating thereto. Please refer to Nagubai Ammal and Others v. B. Shama Rao and Others [(1956) 1 SCC 698].

# 25. In Sayeda Akhtar v. Abdul Ahad [ (2003) 7 SCC 52], it was held that omission to frame an important issue may sometimes cause prejudice to parties resulting in failure to lead evidence on the point. But where the parties were not only aware of the point in controversy but also led evidence and advanced their submissions, this Court held that the High Court was not justified in interfering with the finding of facts of the courts below.

# 26. In the light of the above legal precedents, it can be said that though the framing of issues in an ex parte suit is not mandatory by virtue of Order XIV Rule 6 of CPC, but the judgment must be in  conformity with the provisions of the Code. Thus, Order XX Rule 4 of CPC comes into picture.

# 27. The courts must determine “points for determination”, which are like issues, and answer them to resolve the matter of controversy between the parties.

# 28. Though framing of issues, as mentioned above, although, is not mandatory yet, if the omission to frame the same causes prejudice to the parties, then the same can vitiate the trial. The test for finding as to omission to frame the issues have caused prejudice to the parties or not can be laid down on the touchstone as to whether parties that go to trial had knowledge that (i) a particular question is in issue and (ii) had opportunity to lead evidence on that issue.

# 29. In the present case, the controversy is regarding suit for specific performance of an agreement to sell, therefore, it is important to consider as to what are the key essentials in a suit for specific  performance that a Plaintiff must prove to succeed.

# 30. As laid down in Man Kaur (dead) by LRs v.Hartar Singh Sangha [ (2010) 10 SCC 512], there must be a valid contract; that defendant committed breach of and readiness and willingness of the plaintiff to perform his part of contract.

# 31. In present case, all the three essentials are present. However, the suit was dismissed for lack of title in favour of the Respondent. No issues or points for determination were framed for the same. Appellant at no point was given an opportunity to lead evidence on the same. In the absence of any issues, and especially in the absence of any pleading contesting title of the Respondent, the Appellant could not be expected to prove such title in a suit for specific performance of Agreement to sell. Therefore, omission to frame issues has caused prejudice to the Appellant.

# 32. Hence, the judgment and decree passed by the trial court does not fulfil the requirements of a judgment as provided for under the Code of Civil Procedure, 1908. The judgments and decree of both the courts below are, therefore, not in accordance with law and thus, set-aside.

# 33. As a result;

• i) Matter shall stand remanded to the trial court for fresh consideration and decision.

• ii) The Appellant-Plaintiff shall appear before the trial court on 04.05.2026.

• iii) Trial court shall issue notice on the Respondent and grant time for completion of pleadings.

• iv) The court shall frame issues and accord opportunity to the parties to lead evidence.

• v) The court shall proceed to decide the same at the earliest keeping in view the fact that the suit is of the year 2007.

# 34. The Appeal is disposed of in above terms.

# 35. There shall be no order as to cost.

# 36. Pending application(s), if any, also stands disposed of.

# 37. We acknowledge and appreciate the constructive assistance rendered by the learned Amicus Curiae and the learned Counsel for the Appellant to this Court.

----------------------------------------------------------------

United India Insurance Co.Ltd Vs Sayona Colors Pvt. Ltd - It is a settled principle that fraud vitiates all solemn acts, and no person can be permitted to take advantage of his own wrong. In S.P. Chengalvaraya Naidu v. Jagannath, this Court held that a judgment or decree obtained by playing fraud is a nullity in the eyes of law. Similarly, in A.V. Papayya Sastry v. Government of Andhra Pradesh, it was reiterated that fraud vitiates all judicial acts, whether in rem or in personam.

 SCI (2026.03.17) in United India Insurance Co.Ltd Vs Sayona Colors Pvt. Ltd [2026 INSC 287, CIVIL APPEAL NO. 6100 OF 2024] held that;-

• It is a settled principle that fraud vitiates all solemn acts, and no person can be permitted to take advantage of his own wrong. In S.P. Chengalvaraya Naidu v. Jagannath (1994) 1 SCC 1 :1993 SCC OnLine SC 318, this Court held that a judgment or decree obtained by playing fraud is a nullity in the eyes of law. Similarly, in A.V. Papayya Sastry v. Government of Andhra Pradesh (2007) 4 SCC 221 : 2007 SCC OnLine SC 317, it was reiterated that fraud vitiates all judicial acts, whether in rem or in personam.

• Applying the aforesaid principles, we are of the considered view that once it is established that the claim itself is founded on fraud, the entire edifice of the claim collapses and no relief can be granted. Quantification of loss cannot override the foundational requirement of a genuine and bona fide claim.

Excerpts of the Order;

Heard learned counsel for the parties.

# 2. The appellant-Insurance Company is aggrieved by the order dated 04.12.2023 passed by the National Consumer Disputes Redressal Commission [For short, “NCDRC”], New Delhi in Consumer Complaint No. 171 of 2012, whereby the complaint was partly allowed and the appellant was directed to pay a sum of Rs.3,33,63,642/- (Rupees Three Crores Thirty Three Lakhs Sixty Three Thousand Six Hundred and Forty Two) along with interest at the rate of 6% per annum from 08.07.2012, within a period of six weeks, failing which, the rate of interest would stand enhanced to 9% for the same period, and Rs.50,000/- (Rupees Fifty Thousand) was directed to be paid towards litigation costs.

# 3. The learned counsel appearing for the appellant submitted that the claim made by the respondent is fraudulent, being founded on a deliberate act of sabotage resulting in a fire in the respondent’s godown. It was contended that the fire incident occurred on 25.03.2011, which the respondent attributed to a short circuit, pursuant to which a claim of Rs. 28,20,65,797/- (Rupees Twenty Eight Crores Twenty Lakhs Sixty Five Thousand Seven Hundred and Ninety Seven) was raised for the alleged loss.

# 4. It was further submitted that the timing and quantum of insurance coverage assume significance. Initially, the respondent had obtained an insurance policy for Rs. 15,00,00,000/- (Rupees Fifteen Crores), which was enhanced to Rs. 19,00,00,000/- (Rupees Nineteen Crores) on 07.03.2011. In addition, another policy for Rs. 17,00,00,000/- (Rupees Seventeen Crores) was obtained for the period from 28.11.2010 to 27.11.2011. The fire incident occurred shortly thereafter on 25.03.2011, raising serious doubt regarding the bona fides of the claim.

# 5. The learned counsel further submitted that upon investigation, the surveyor opined that the fire was not caused by a short circuit, but appeared to a deliberate human act. This conclusion was further supported by an independent expert opinion obtained from Truth Labs.

# 6. It was also contended that the respondent claimed the existence of substantial stock allegedly procured shortly prior to the incident and after enhancement of the insurance coverage. However, upon verification, the agencies shown to have supplied the said material, were found to be either non-existent at the given addresses or were not engaged in the trade of the goods claimed to have been supplied.

# 7. It was further urged that the respondent relied upon a report of the Gujarat Forensic Science Laboratory (GFSL) which indicated the presence of ethyl alcohol, an inflammable substance. According to the appellant, the sample sent namely, parts of the switchboard, had already been burnt, thereby rendering the sample itself unreliable; therefore, the said GFSL report cannot be treated as conclusive.

# 8. It was submitted that a holistic evaluation of all attending circumstances is necessary to determine whether the fire was accidental or deliberate. In the present case, the proximity of procurement of material to the incident, enhancement of insurance coverage, and the discovery that the alleged suppliers lacked the capacity to supply such goods cumulatively establish that the claim is not genuine.

# 9. On the aspect of quantification, the learned counsel submitted that the surveyor’s assessment of loss of Rs. 3,33,63,642/- (Rupees Three Crores Thirty Three Lakhs Sixty Three Thousand Six Hundred and Forty Two) merely reflects the extent of physical damage to the godown and cannot be treated as an admission of liability. It was contended that if the loss itself is consequence of a deliberate and fraudulent act, no claim under the policy would be maintainable, irrespective of the extent of damage. Accordingly, it was prayed that the impugned order passed by the NCDRC be set aside.

# 10. Per contra, the learned counsel appearing for the respondent submitted that during the subsistence of the insurance coverage, an accidental fire occurred on 25.03.2011 in the respondent’s godown due to a short circuit. The incident was duly intimated to the appellant on the same day and was also recorded with the local police. It was contended that the respondent suffered a loss of Rs.28,20,65,797/- (Rupees Twenty Eight Crores Twenty Lakhs Sixty Five Thousand Seven Hundred and Ninety Seven) that the GFSL report conclusively establishes that the fire was accidental in nature.

# 11. In response to a query raised by this Court regarding the authenticity of the alleged suppliers, the learned counsel for the respondent submitted that the claim was made based on the actual supplies, and affidavits of such suppliers had been placed on record. However, it was submitted that the respondent had not independently verified the actual existence or credentials of such suppliers.

# 12. We have considered the rival submissions and perused the material available on record.

# 13. It is evident from the record that the present case involves a fraudulent insurance claim. The respondent enhanced the insurance coverage and procured an additional policy in close proximity to the incident, which raises serious doubt regarding the bona fides of the claim.

# 14. In this context, the Truth Labs Report establishes, through GC-MS analysis of fire debris, the presence of hydrocarbon residues consistent with kerosene in the area identified as the seat of the fire (Zones IX A and X A). Significantly, such traces were absent in samples collected from areas away from the origin of the fire. That apart, the presence of kerosene, a known fire accelerant, at the seat of the fire clearly indicates that it was introduced externally to initiate the fire, thereby ruling out an accidental cause and pointing toward deliberate arson for gain. Further, forensic examination of the electrical infrastructure such as power supply wires, switchboards, and lighting systems, revealed no evidence of short circuit or electrical malfunction. The absence of overheating, annealing, or bead formation in the wiring conclusively negates an electrical cause.

# 15. Additionally, the conduct of the respondent reinforces the inference of fraud. There was delay in furnishing samples and subsequent reliance on fabricated analytical reports, indicating a clear attempt to mislead the investigation. Thus, the forensic report concludes that the fire was the result of deliberate human intervention, with a strong likelihood of it being engineered for unlawful gain.

# 16. The Surveyor’s report corroborates the above conclusions. It reveals material discrepancies between the VAT returns submitted by the Suppliers of the respondent and those filed with the Commercial Taxes Department. The alleged suppliers, in whose names’ invoices were produced to substantiate the claim, were found to be non-existent or unrelated to the claimed transactions, and the invoices produced were evidently fabricated. Notably, the respondent failed to rebut these findings with credible material.

# 17. The investigation further discloses manipulation of accounts and records with a view to inflate the claim. Both the forensic and Surveyor reports unequivocally establish violation of policy conditions, warranting repudiation.

# 18. In view of the above, it stands conclusively established that the fire was not accidental but was the result of a deliberate and orchestrated act of arson.

# 19. Despite these categorical findings, the NCDRC proceeded to allow the claim in part merely on the premise that a fire incident had occurred. Such an approach is legally unsustainable, as it disregards the overwhelming evidence of fraud and deliberate misconduct on the part of the respondent.

# 20. It is a settled principle that fraud vitiates all solemn acts, and no person can be permitted to take advantage of his own wrong. In S.P. Chengalvaraya Naidu v. Jagannath (1994) 1 SCC 1 :1993 SCC OnLine SC 318, this Court held that a judgment or decree obtained by playing fraud is a nullity in the eyes of law. Similarly, in A.V. Papayya Sastry v. Government of Andhra Pradesh (2007) 4 SCC 221 : 2007 SCC OnLine SC 317, it was reiterated that fraud vitiates all judicial acts, whether in rem or in personam.

# 21. Applying the aforesaid principles, we are of the considered view that once it is established that the claim itself is founded on fraud, the entire edifice of the claim collapses and no relief can be granted. Quantification of loss cannot override the foundational requirement of a genuine and bona fide claim.

# 22. There is no concept of partial or equitable relief in cases tainted by fraud. Courts and adjudicatory fora cannot grant compensation merely because some loss is shown to have occurred, when the claim itself is vitiated by fraudulent conduct. An insurance contract cannot be used as an instrument of unjust enrichment. The NCDRC therefore, fell into error in awarding Rs.3,33,63,642/- (Rupees Three Crores Thirty Three Lakhs Sixty Three Thousand Six Hundred and Forty two) towards the alleged loss sustained by the respondent.

# 23. In view thereof, we have no hesitation in holding that the respondent is not entitled to any amount under the policy, and the claim deserves to be rejected in toto.

# 24. Accordingly, the appeal is allowed. The impugned order passed by the NCDRC is set aside. The claim of the respondent stands repudiated. The appellant-Insurance company is absolved of any liability arising out of the said claim. The amount deposited by the appellant before the Registry of this Court shall be refunded to it, along with accrued interest, within a period of two weeks from today.

# 25. Before parting, we deem it appropriate to observe that fraudulent insurance claims involving staged incidents are not uncommon and have serious ramifications on the integrity of the insurance system and public confidence therein.

# 26. In view of the categorical finding of fraud committed in relation to the insurance claim by the respondent, we direct the Commissioner of Police, Ahmedabad, to constitute a Special Investigation Team (SIT) headed by an officer not below the rank of Deputy Commissioner of Police, to conduct a comprehensive investigation into the incident, including the persons involved in the alleged fraud. The investigation shall be completed within a period of three months from today and a report shall be submitted before this Court in a sealed cover. The Commissioner of Police, Ahmedabad, shall ensure full logistical and institutional support to the SIT and shall remain responsible for compliance with these directions.

# 27. The Registry is directed to list the matter on 21.07.2026 at 2.00 PM before the same Bench, treating it as a tied-up / part- heard. A copy of this order shall be communicated to the Commissioner of Police, Ahmedabad, forthwith. 

CIVIL APPEAL NO. 10019 OF 2024 In view of the order passed in Civil Appeal No. 6100 of 2024, of even date, the present appeal stands dismissed.

2. Pending application(s), if any, shall stand disposed of.

----------------------------------------------------------------

Lamba Exports Pvt. Ltd. Vs. Dhir Global Industries Pvt. Ltd. and Ors - Likewise, in Vallal RCK v. Siva Industries & Holdings Ltd. (2022) 9 SCC 803], this Court reiterated that where a withdrawal under Section 12A of the IBC has received the requisite approval, the scope of interference remains narrow and the commercial decision of the CoC is not to be displaced except on grounds known to law.

  SCI (2026.03.23) in Lamba Exports Pvt. Ltd. Vs. Dhir Global Industries Pvt. Ltd. and Ors.[   (2026) ibclaw.in 129 SC,  Misc. Application No. 1256 & 1257 of 2025 in Special Leave Petition (Civil) No. 12264 of 2024] held that;- 

• At this stage, we may also clarify that we are not inclined to accept the broad submission that the dismissal of the SLP on 25.02.2025, by itself, attracted the doctrine of merger. The law is clear that an order refusing special leave to appeal, whether speaking or non-speaking, does not attract merger.

• There can be no quarrel with the principle that fraud vitiates all proceedings and that a Court is not powerless where its order has been procured by fraud. But the exception is a serious one and cannot be invoked on the basis of assertion alone.

• The material now relied upon, even if taken at its highest, may at best furnish the applicant with a separate grievance arising out of subsequent or parallel proceedings. It does not persuade us to hold, in the present proceedings, that the order dated 25.02.2025 itself was procured by practicing fraud on this Court.

• The statutory scheme of Section 12A of the IBC contemplates withdrawal of the insolvency process, after constitution of the CoC, only upon approval by the requisite voting share of the CoC. Once the matter enters that domain, the decision whether to accept a settlement, whether to continue with the process, or whether to adopt one commercial course over another, falls essentially within the realm of the collective commercial wisdom of the CoC.

• In K. Sashidhar v. Indian Overseas Bank [(2019) 12 SCC 150], this Court emphasized that the legislature has consciously made the commercial wisdom of the financial creditors non-justiciable and that the adjudicating and appellate authorities do not sit in appeal over such business decisions.

• Likewise, in Vallal RCK v. Siva Industries & Holdings Ltd. (2022) 9 SCC 803], this Court reiterated that where a withdrawal under Section 12A of the IBC has received the requisite approval, the scope of interference remains narrow and the commercial decision of the CoC is not to be displaced except on grounds known to law.

• It is necessary to state that primacy of commercial wisdom does not mean that every action taken in the insolvency process is altogether immune from scrutiny in every situation. Where a challenge is laid in an appropriate proceeding on a legally sustainable foundation, such as statutory illegality or a jurisdictional infirmity, the matter would naturally be considered in accordance with law.

Excerpts of the Order;

# 1. The present Miscellaneous Application No. 1256 of 2025 (hereinafter referred to as the “MA”) has been filed in Special Leave Petition (Civil) No. 12264 of 2024 (hereinafter referred to as the “SLP”) seeking recall of whereby the SLP filed against the judgment and order  dated 06.05.2024 passed by the High Court of Punjab and Haryana at Chandigarh in Civil Revision No. 3916 of 2022 came to be dismissed. The case set up in the MA is that subsequent developments, including the alleged non-disclosure of the proposal for a One Time Settlement (hereinafter referred to as the “OTS”), the eventual settlement arrived at between the secured creditor and the corporate debtor, and the withdrawal of the Corporate Insolvency Resolution Process (hereinafter referred to as the “CIRP”) under Section 12A of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “IBC”), have a material bearing on the foundation on which the matter proceeded earlier and warrant reconsideration of the order dated 25.02.2025.

# 2. The facts giving rise to the present MA are as follows:

2.1. The dispute between the parties arises out of an Agreement to Sell dated 13.08.2021 in respect of the subject property owned by Respondent No. 1.

The applicant claims rights on the basis of the said agreement. The respondents, on the other hand, dispute the enforceability of the said arrangement and contend that the agreement did not survive in the manner asserted by the applicant.

2.2. The applicant instituted Civil Suit No. 1248 of 2022 seeking specific performance of the Agreement to Sell dated 13.08.2021, along with consequential reliefs of declaration, mandatory injunction, and permanent injunction. The case set up by the applicant was that the suit property, bearing UV- 375, Udyog Vihar, Phase-IV, Gurugram, was agreed to be sold for a total sale consideration of Rs.21,00,00,000/-. It was alleged that the applicant had paid Rs.30,00,000/- as earnest Bank towards the upfront amount for the proposed OTS, and a further sum of Rs.30,00,000/- to Respondent Nos. 1 to 3. According to the applicant, Respondent Nos. 1 to 3 thereafter sought to resile from the Agreement to Sell by legal notice dated 25.03.2022 on the ground that the proposed OTS had not been accepted by the Bank, whereas the applicant maintained that the Agreement to Sell was not liable to be rescinded on that basis and that it had always been ready and willing to perform its part of the contract.

2.3. Along with the suit, the applicant moved an application seeking interim injunction restraining Respondent Nos. 1 to 3 from selling, alienating,  encumbering, or otherwise creating third party rights in respect of the suit property during the pendency of the suit. By order dated 19.07.2022, the Civil Judge (Junior Division), Gurugram allowed the said application and granted interim protection in favour of the applicant. Aggrieved thereby, Respondent Nos. 1 to 3 preferred an appeal, which came to be allowed by the learned Additional District Judge, Gurugram by order dated 06.09.2022, whereby the order dated 19.07.2022 passed by the Trial Court was set aside.

2.4. The applicant thereupon challenged the appellate order before the High Court of Punjab and Haryana at Chandigarh in Civil Revision No. 3916 of 2022. By judgment and order dated 06.05.2024, the High Court dismissed the revision petition. The High Court held, in substance, that the Agreement to Sell dated 13.08.2021 was itself contingent in nature, inasmuch as its performance was predicated upon the acceptance of the OTS by the Bank. The High Court noted that the suit property was mortgaged, that the Bank was not a party to the Agreement to Sell, and that without the Bank’s approval to the OTS, Respondent Nos. 1 to 3 were  not in a position to convey title in respect of the property. On that reasoning, the High Court held that no prima facie case for grant of interim injunction was made out and that, at the highest, the applicant could claim recovery of the amounts paid by it, but could not, at that stage, insist upon specific performance of an agreement the performance of which had become uncertain in the absence of the Bank’s approval.

2.5. It appears that the underlying suit for specific performance, being Civil Suit No. 1248 of 2022, continues to remain pending, the proceedings before this Court having arisen from orders passed on the interlocutory application seeking interim protection.

2.6. When the SLP came up before this Court on 04.06.2024, notice was issued. This Court also directed the applicant to deposit a sum of Rs.13,00,00,000/- (Rupees Thirteen Crores Only) with the Registry of this Court within four weeks and to file an undertaking to deposit an additional amount of Rs.13,00,00,000/- (Rupees Thirteen Crores Only) within four weeks after Respondent No. 4 entered appearance. It is the case of the applicant that, in compliance with the said order, a  total sum of Rs.26,00,00,000/- (Rupees Twenty-

Six Crores Only) came to be deposited with the Registry of this Court.

2.7. The SLP was ultimately dismissed by order dated 25.02.2025. The present MA has thereafter been filed seeking recall of the order dated 25.02.2025 on the basis of subsequent events which, according to the applicant, have a direct bearing on the matter. The respondents have raised a preliminary objection to the maintainability of the MA and contend that no such recall application would lie after dismissal of the SLP.

2.8. The subsequent events relied upon in the MA are that during the pendency of the SLP, Respondent No. 1 is stated to have addressed a proposal dated 14.02.2025 to Respondent No. 4 for an OTS and for withdrawal of the CIRP under Section 12A of the IBC. It is further the case of the applicant that an OTS was thereafter concluded on 21.03.2025 for an amount of Rs.34.85 crore, and that the Committee of Creditors (hereinafter referred to as the “CoC”), in its meeting dated 05.04.2025, approved withdrawal of the CIRP under Section 12A of the IBC. The applicant also relies upon an email dated 23.03.2025 addressed by it to the Resolution  Professional expressing its willingness to participate in the process.

2.9. It is on the strength of the aforesaid developments that the applicant alleges suppression of material facts and seeks recall of the order dated 25.02.2025. The respondents dispute the said allegations. Their stand is that the proceedings before the National Company Law Tribunal were independent of the proceedings arising from the suit for specific performance, that the MA is not maintainable after dismissal of the SLP, and that the OTS has already been acted upon.

# 3. Having heard learned counsel for the parties and having perused the material placed on record, we are of the considered view that the present MA does not merit acceptance.

# 4. The first obstacle in the way of the applicant is one of maintainability. The order dated 25.02.2025, recall of which is sought, is not an executory order. It merely records that this Court was not inclined to interfere with the impugned judgment and order and, accordingly, dismissed the SLP. The present MA does not seek correction of any clerical or arithmetical error. Nor is it a case where directions contained in an  executory order of this Court have become impossible of implementation by reason of subsequent events. The settled position is that a post-disposal miscellaneous application can be entertained only in rare situations of that nature. The present case does not fall within that limited class.

# 5. In Jaipur Vidyut Vitran Nigam Ltd. v. Adani Power Rajasthan Ltd.[(2024) 19 SCC 353], this Court has held in clear terms that, once a matter stands disposed of, the Court becomes functus officio and does not retain jurisdiction to entertain an application except in the narrow situations recognized by law. The same position was reiterated in Ajay Kumar Jain v. The State of Uttar Pradesh & Anr.[2024 INSC 958], where this Court deprecated the growing practice of filing miscellaneous applications in disposed of proceedings and clarified that such an application would be maintainable only in the limited situations already noticed above. The maintainability objection, therefore, goes to the root of the matter and cannot be brushed aside merely because notice had been issued in the present MA.

# 6. That apart, the controversy which is now sought to be projected in the present MA travels well beyond the four corners of the proceedings from which the SLP had arisen. The SLP arose from a suit-based dispute concerning the Agreement to Sell dated 13.08.2021 and the correctness of the order passed by the High Court in Civil Revision No. 3916 of 2022. The present MA, however, seeks to found a case for recall on the basis of later developments said to have taken place in the insolvency proceedings, including the proposal for One Time Settlement, the subsequent settlement, the decision of the Committee of Creditors, and the order passed by the National Company Law Tribunal under Section 12A of the IBC. Whether those later steps were proper or otherwise cannot be examined collaterally in an MA filed in a disposed of SLP arising out of a civil revision. If the applicant is aggrieved by any act done or order passed in that separate statutory framework, it is always open to the applicant to avail of such remedy as may be permissible in law before the competent forum.

# 7. At this stage, we may also clarify that we are not inclined to accept the broad submission that the dismissal of the SLP on 25.02.2025, by itself, attracted the doctrine of merger. The law is clear that an order refusing special leave to appeal, whether speaking or non-speaking, does not attract merger. However, that  does not carry the matter any further for the applicant. The absence of merger does not mean that a disposed of SLP can be reopened through a miscellaneous application on grounds which do not satisfy the settled parameters of maintainability.

# 8. Much emphasis was placed by the applicant on alleged suppression and on the submission that the order dated 25.02.2025 deserves to be recalled on the ground that fraud was practiced upon this Court. There can be no quarrel with the principle that fraud vitiates all proceedings and that a Court is not powerless where its order has been procured by fraud. But the exception is a serious one and cannot be invoked on the basis of assertion alone. In the present case, the order dated 25.02.2025 is a non-speaking order dismissing the SLP. The order dated 25.02.2025 does not indicate that the dismissal turned upon any specific representation which is now alleged to have been suppressed. The material now relied upon, even if taken at its highest, may at best furnish the applicant with a separate grievance arising out of subsequent or parallel proceedings. It does not persuade us to hold, in the present proceedings, that the order dated 25.02.2025 itself was procured by practicing fraud on this Court.

# 9. There is yet another aspect of the matter. The challenge to the judgment and order dated 06.05.2024 passed by the High Court had to be considered on the record and circumstances as they then stood. Subsequent developments in another forum, howsoever strongly relied upon by the applicant, cannot retroactively render the earlier adjudicatory exercise vulnerable in a disposed of SLP. A later event may, in a given case, furnish an independent cause of action. It cannot, by itself, be used to reopen finality in proceedings of a different character and origin.

# 10. Even otherwise, we are unable to accept the applicant’s attempt to invite this Court, in the present MA, to comparatively assess the alleged superiority of its offer vis-à-vis the settlement which came to be accepted in the insolvency process. The statutory scheme of Section 12A of the IBC contemplates withdrawal of the insolvency process, after constitution of the CoC, only upon approval by the requisite voting share of the CoC. Once the matter enters that domain, the decision whether to accept a settlement, whether to continue with the process, or whether to adopt one commercial course over another, falls essentially within the realm of the collective commercial wisdom of the CoC. In K. Sashidhar v. Indian Overseas Bank [(2019) 12 SCC 150], this Court emphasized that the legislature has consciously made the commercial wisdom of the financial creditors non-justiciable and that the adjudicating and appellate authorities do not sit in appeal over such business decisions.

# 11. The same principle was reiterated and explained in Essar Steel (India) Ltd. Committee of Creditors v. Satish Kumar Gupta [(2020) 8 SCC 531], where this Court held that it is the commercial wisdom of the majority of the CoC which determines, through negotiations and assessment of viability, how and in what manner the corporate insolvency resolution process is to proceed. More particularly, this Court observed that the adjudicating authority cannot make any inquiry beyond the limited statutory parameters, nor can it issue directions in relation to the exercise of commercial wisdom of the CoC, whether in approving, rejecting, or otherwise dealing with a proposal. Likewise, in Vallal RCK v. Siva Industries & Holdings Ltd. (2022) 9 SCC 803], this Court reiterated that where a withdrawal under Section 12A of the IBC has received the requisite approval, the scope of interference remains narrow and the commercial decision of the CoC is not to be displaced except on grounds known to law.

# 12. At the same time, it is necessary to state that primacy of commercial wisdom does not mean that every action taken in the insolvency process is altogether immune from scrutiny in every situation. Where a challenge is laid in an appropriate proceeding on a legally sustainable foundation, such as statutory illegality or a jurisdictional infirmity, the matter would naturally be considered in accordance with law. However, that is not the exercise which can be undertaken in the present MA. In these proceedings, which arise out of a disposed of SLP in a civil revision concerning an Agreement to Sell, this Court cannot be called upon to sit over the comparative financial attractiveness of rival offers or to substitute its own view for the business decision taken by the CoC in the statutory process under the IBC. The mere assertion by the applicant that its offer was higher would not, by itself, furnish a ground to reopen the dismissal of the SLP or to unsettle steps taken in a separate insolvency framework.

# 13. For all the aforesaid reasons, we are not persuaded to entertain the present MA as a vehicle either for reopening the dismissal of the SLP dated 25.02.2025  or for examining the legality of the subsequent steps taken in the insolvency proceedings.

# 14. Accordingly, Miscellaneous Application No. 1256 of 2025 is dismissed. In view of the same, MA No. 1257 of 2025 for ad-interim relief is not required to be dealt with.

# 15. It is, however, clarified that we have expressed no opinion on the merits of any proceedings undertaken under the Insolvency and Bankruptcy Code, 2016, including the order dated 14.05.2025 passed by the National Company Law Tribunal, or on the merits of Civil Suit No. 1248 of 2022, which, as per the record before us, remains pending. All rights and contentions of the parties in such proceedings are left open to be urged before the competent forum in accordance with law.

# 16. Pending application(s), if any, shall stand disposed of.

------------------------------------------------------