Supreme Court Daily Digest (March 24, 2026)

Supreme Court of India

New Delhi

Supreme Court of India Decisions (March 24, 2026)

The Supreme Court delivered landmark judgments on March 24, 2026. In Chinthada Anand, it held that a Christian convert cannot claim SC status for protection under the SC/ST Act. In arbitration, Bharat Udyog affirmed that a valid arbitration agreement requires mutual consent. On service law, the Court granted pensionary benefits to SSC officers in the Army, Navy, and Air Force whose ACRs were written when they were ineligible for Permanent Commission. In Rashtriya Chemicals, it clarified that “intended use” for excise exemption is a subjective test. Finally, in CTUIL, it ruled that set-off of pre-CIRP dues violates the IBC moratorium.

1. Criminal Law: Sexual Assault & Appreciation of Evidence

Case: State of Himachal Pradesh v. Hukum Chand Alias Monu
Citation: 2026 INSC 290
Coram: Justices Sanjay Karol and Nongmeikapam Kotiswar Singh

Facts: The State appealed against a High Court judgment that had acquitted the respondent-accused of raping a nine-year-old girl. The Trial Court had convicted the accused based on the testimony of the victim and other witnesses. The High Court reversed the conviction, citing major contradictions in witness testimonies, improbabilities in the timeline (a 16 km travel within two hours), a pre-existing family quarrel, and a delay in reporting the incident.

Key Legal Principles:

Appreciation of Child Witness Testimony: The Court reiterated the principles for evaluating child witness testimony:
- No hard and fast rule for testing competency; the trial judge must assess intelligence and understanding of truth.
- Non-administration of oath does not invalidate testimony.
- The trial judge must be vigilant against tutoring or influence.
- Corroboration of a child’s testimony is practical wisdom.
- A child witness can be cross-examined, and if they withstand it, conviction can be based solely on their testimony.
Sole Testimony of the Prosecutrix: It is well-settled that the testimony of a sexual assault victim, if it inspires confidence, is sufficient for a conviction. Corroboration is not a requirement of law but a rule of prudence.
Inconsistencies in Testimony: Minor inconsistencies or trivial discrepancies that do not affect the core of the case should not lead to rejection of credible evidence. Material contradictions that go to the core of the prosecution narrative can, however, create reasonable doubt.
Medical Evidence: Medical evidence is corroborative. It cannot be ignored if it aligns with the victim’s testimony, even if other minor improbabilities exist.
Protection of Victim Identity: The Court strongly deprecated the practice of freely disclosing the name of the victim in court records, emphasizing the mandate of Section 228-A IPC. It directed that a copy of the judgment be sent to all High Court Registrars General to ensure strict compliance with non-disclosure norms in pending matters.

Outcome: The Supreme Court set aside the High Court’s acquittal and reinstated the conviction and sentence, holding that the High Court’s approach was flawed. The victim’s testimony was consistent and credible, and the discrepancies highlighted were minor and did not undermine the prosecution’s case.

2. Arbitration Law: Existence of a Valid Arbitration Agreement

Case: M/s Bharat Udyog Ltd. v. Ambernath Municipal Council & Anr.
Citation: 2026 INSC 288
Coram: Justices Pamidighantam Sri Narasimha and Alok Aradhe

Facts: The petitioner was awarded an octroi collection contract by the Municipal Council. A dispute arose over the minimum reserve price. The petitioner, after withdrawing a writ petition, approached the State Government, which appointed an arbitrator under Section 143-A(3) of the Maharashtra Municipal Councils Act, 1965. The Municipal Council participated in the proceedings under protest but later challenged the award. The High Court set aside the award, holding there was no valid arbitration agreement.

Key Legal Principles:

Arbitration Agreement (Section 2(a), Arbitration Act, 1940): A valid arbitration agreement requires consensus ad idem between the parties. A clause providing for a departmental dispute-resolution mechanism (e.g., decision of the Collector) does not constitute an arbitration agreement.
Jurisdiction to Appoint Arbitrator: The State Government cannot unilaterally appoint an arbitrator or “foist” arbitration on parties to a concluded contract unless such power is explicitly conferred by the contract or by law. Section 143-A(3) of the 1965 Act pertains to policy directions for octroi collection, not the power to appoint arbitrators.
Waiver/Estoppel: Active participation in arbitral proceedings does not confer jurisdiction where there is no underlying arbitration agreement. The lack of jurisdiction is a fundamental issue that can be raised at any stage.

Outcome: The Supreme Court upheld the High Court’s decision. The contract clause (Clause 22) was not an arbitration agreement, and the State Government had no authority to appoint the arbitrator. The award was a nullity. The special leave petition was dismissed.

3. Service Law (Armed Forces): Permanent Commission for SSC Officers (Army & Air Force) & Pensionary Benefits

This four judgments addresses the long-pending issue of granting Permanent Commission (PC) to Short Service Commission Officers (SSCOs), particularly women, in the Army, Navy, and Air Force. The common thread is the systemic disadvantage faced by officers whose Annual Confidential Reports (ACRs) were authored during a period when they had no prospect of long-term career progression.

3.1. Case: Union of India & Ors. v. Balakrishnan Mullikote (Ex Hav 256812 M) & Ors.

Citation: 2026 INSC 286
Coram: Justices Manoj Misra and Manmohan

Facts: This was a batch of appeals concerning the Defence Security Corps (DSC). The issue was whether DSC personnel, who were already in receipt of one pension from their regular service, were entitled to condonation of a shortfall in qualifying service (of up to 12 months) to become eligible for a second service pension from their DSC service.

Key Legal Principles:

Incorporation by Reference: The pensionary provisions applicable to Personnel Below Officer Rank (PBOR) of the Regular Army equally govern DSC personnel (under Para 173 of Pension Regulations, 2008) unless inconsistent with DSC-specific provisions.
Condonation of Shortfall: Paragraph 44 of the Pension Regulations, 2008 provides for condonation of deficiency in service (up to 12 months) to make an officer eligible for pension. The Court found no inconsistency between this provision and the DSC-specific regulations (Para 175), which do not prohibit such condonation.et of four
Rounding off of Service: The Court directed that the length of qualifying service must be first determined by rounding off periods of three months and above but less than six months as a completed half-year, as per the Government of India letter dated 30th October 1987.
Executive Letters Cannot Amend Regulations: The Union of India cannot, by way of administrative letters, override or amend clear and categorical provisions of the Pension Regulations.

Outcome: The appeals were dismissed. The Court held that DSC personnel are entitled to have their qualifying service determined with the rounding-off benefit and, if after that there is a shortfall of up to one year, to have it condoned under the applicable regulations.

3.2. Cases: Lt. Col. Pooja Pal & Ors. v. Union of India & Ors. (Army) & Yogendra Kumar Singh v. Union of India & Ors. (Navy) & Wg. Cdr. Sucheta EDN & Ors. v. Union of India & Ors. (Air Force)

Citations: 2026 INSC 281, 2026 INSC 282, 2026 INSC 280 respectively
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Common Facts (All Three Services):
SSCWOs who were inducted into their respective services before policies were changed to grant them PC were later considered for PC. They were assessed based on ACRs that were written during a period when they were known to be ineligible for PC and had no career progression prospects. The selection boards in all three services were challenged for being unfair.

Key Legal Principles (Common):

Casual Grading of ACRs: Where officers are assessed under the prevailing assumption that they have no future in the service (i.e., are ineligible for PC), the appraisal process is fundamentally skewed. Higher grades are reserved for those with perceived career prospects, and ACRs written under such a premise cannot be reliably used to determine suitability for PC when the policy is later changed.
Systemic Disadvantage: The years of “middling grades” and the denial of career-enhancing opportunities (like criteria appointments and specialised courses) during their initial tenure placed these officers at a structural disadvantage when they were later made to compete for PC.
Non-Disclosure of Criteria: The failure to disclose the evaluation criteria, vacancy computation methodology, and allied policy considerations prior to the selection boards violated basic norms of fairness and transparency.
Flexibility of Vacancy Caps: While the cap on PC vacancies (e.g., 250 per year in the Army) is a matter of policy, it is not an inflexible norm, particularly when adherence would perpetuate constitutional inequality. Breaches of the cap in the past for operational reasons indicate it can be relaxed in deserving cases.

Outcome (Common Relief): The Supreme Court allowed the appeals of the SSCWOs, setting aside the adverse judgments of the AFT and High Court.

Common Directions:

Pensionary Benefits for Released Officers: As a one-time measure, SSCWOs who were considered for PC but not granted it, and have since been released from service, shall be deemed to have completed 20 years of qualifying service. They are entitled to pension and consequential benefits, with arrears payable from 01.01.2025.
Permanent Commission for Serving Officers: SSCWOs who are still in service and who had achieved the minimum cut-off grade (e.g., 60% in the Army) in the relevant selection boards shall be granted PC, subject to medical and disciplinary clearance.
Future Transparency: For all future selection boards, the services must issue clear guidelines prior to the board, detailing the evaluation criteria, marks apportionment, and vacancy availability.

3.3. Case: Sqn. Ldr. Nitu Thapliyal & Ors. v. Union of India & Ors. (Implementation of AU Tayyaba)

Citation: Order in Misc. Application Nos. 1799-1803/2023 in Civil Appeal Nos. 192-196/2012
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts:
This was an application seeking implementation of the judgment in AU Tayyaba v. Union of India. Two issues arose: (i) Three applicants were denied pensionary benefits for not meeting the 6.5 average ACR grading required under HRP 04/10; (ii) Other applicants sought notional promotion and pension computation based on a higher rank.

Outcome:

Denial of Pension (Applicants with low ACRs): The Court upheld the Air Force’s decision, finding no mitigating circumstances to waive the clear eligibility criteria. The prayer was rejected.

Computation of Pension: The Court directed that the clarifications from the AU Tayyaba implementation order (dated 15.04.2024) would apply. Pension is to be computed on a notional basis of having completed 20 years of service, including increments, but notional time-scale promotion to Wing Commander was denied. The Court held that granting a notional promotion to a rank never held would be conceptually untenable.

3.4. Case: Neeraj Kumar & Anr. v. Union of India & Ors.

Citation: Civil Appeal No. 640/2025
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts: Two male SSCOs of the Air Force, who had voluntarily sought release from service in 2009, filed an OA in 2011 seeking reinstatement and consideration for PC. They relied on judgments that granted relief to other officers who had acted promptly.

Key Principle: Relief in service matters, especially concerning reinstatement after voluntary retirement/discharge, is discretionary. It is available only to those who approach the court with diligence and without delay.

Outcome: The Supreme Court dismissed the appeal. The Appellants had voluntarily left service, secured alternative employment, and approached the AFT with significant delay (over two years after their release and 18 months after the landmark Babita Puniya judgment). They were not entitled to the same relief.

4. Central Excise Law: Exemption for “Intended Use”

Case: M/s. Rashtriya Chemicals and Fertilizers Limited v. Commissioner of Central Excise and Service Tax (LTU) & Anr.
Citation: 2026 INSC 285
Coram: Justices Manoj Misra and Ujjal Bhuyan

Facts: The appellant, a fertilizer manufacturer, procured Naphtha at a nil rate of duty under exemption notifications for “use in the manufacture of fertilizer or ammonia.” The Revenue alleged that Naphtha was also used in other plants (chemicals, heavy water, power generation) and was, therefore, diverted from its intended use. The demand was confirmed. The CESTAT upheld the demand.

Key Legal Principles:

Interpretation of “Intended for Use”: The Court reiterated that the requirement for an exemption is proof that the goods were “intended for use” in the specified process, not that they were “actually used” in a mathematically direct manner. (Reliance placed on Steel Authority of India v. Collector of Central Excise and State of Haryana v. Dalmia Dadri Cement Ltd.).
Invocation of Extended Limitation (Section 11A): For the extended period of limitation (5 years) to apply, there must be deliberate suppression of facts with an intent to evade duty. In the absence of a finding that the assessee’s conduct was deliberate and fraudulent, especially where the issue was one of interpretation, the extended period cannot be invoked.
Revenue Neutrality: Where the entire exercise is revenue-neutral (i.e., any duty paid would be available as a credit), the assessee cannot be said to have an intention to evade duty. In such cases, the extended period of limitation is not available to the Revenue.

Outcome: The Supreme Court allowed the appeals, setting aside the orders of the CESTAT and the original adjudicating authority. The Court held that the appellant was entitled to the benefit of the exemption as the Naphtha was “intended for use” in fertilizer manufacture, and the Revenue had not established a case for invoking the extended period of limitation.

Here is a comprehensive legal digest of the Supreme Court cases provided, structured for clarity and ease of reference.

5. Criminal Law: SC/ST Act Applicability & Quashing of Proceedings

Case: Chinthada Anand v. State of Andhra Pradesh & Ors.
Citation: 2026 INSC 283
Coram: Justices Prashant Kumar Mishra and Manmohan

Facts: The appellant, a Pastor belonging to the Madiga community (a Scheduled Caste), alleged that he was assaulted and abused with caste-based slurs by the respondents. An FIR was registered under the SC/ST Act and IPC. The High Court quashed the proceedings under Section 482 CrPC, holding that the appellant, by converting to Christianity and working as a Pastor, could not claim protection under the SC/ST Act.

Key Legal Principles:

SC/ST Status After Conversion (Clause 3, Constitution (Scheduled Castes) Order, 1950): The Court held that Clause 3 of the Order is categorical: “no person who professes a religion different from the Hindu, the Sikh or the Buddhist religion shall be deemed to be a member of a Scheduled Caste.” The appellant, by openly professing and practicing Christianity as a Pastor, falls outside this definition.
Meaning of “Profess”: The term “profess” means an open declaration or practice of a religion, as interpreted in Punjabrao v. D.P. Meshram. The appellant’s conduct as a Pastor constituted a public and unequivocal declaration of his Christian faith.
Postulates for SC/ST Status: The Court laid down key principles:
- The claimant must belong to a notified caste.
- A person professing a religion other than Hindu, Sikh, or Buddhist loses SC status absolutely.
- A person cannot simultaneously profess a different religion and claim SC status for statutory benefits.
- Reconversion to Hinduism, Sikhism, or Buddhism requires proof of: (a) original caste, (b) bona fide reconversion and renunciation of the other faith, and (c) acceptance by the community.
State Government Order (G.O.Ms. No. 341): Such an order extending “non-statutory concessions” to converts cannot override the Constitutional mandate of the Presidential Order. It does not entitle a convert to statutory protections under the SC/ST Act.
IPC Offences: The Court also found that the allegations under Sections 341, 506, and 323 IPC were not supported by the material on record, as independent witnesses did not corroborate the victim’s version. The proceedings under the IPC were also quashed.

Outcome: The Supreme Court dismissed the appeal, upholding the High Court’s order to quash the criminal proceedings. The appellant, being a Christian, was not a member of the Scheduled Caste and could not invoke the SC/ST Act. The IPC offences were also not made out.

6. Arbitration Law: Existence of a Valid Arbitration Agreement

Case: M/s Bharat Udyog Ltd. v. Ambernath Municipal Council & Anr.
Citation: 2026 INSC 288
Coram: Justices Pamidighantam Sri Narasimha and Alok Aradhe

Facts: A dispute arose between a contractor (petitioner) and a Municipal Council over an octroi collection contract. The petitioner approached the State Government, which appointed an arbitrator. The Municipal Council participated under protest but later challenged the award. The High Court set aside the award, holding there was no valid arbitration agreement. The Supreme Court upheld this decision.

Key Legal Principles:

Arbitration Agreement (Section 2(a), Arbitration Act, 1940): A valid arbitration agreement requires a clear consensus ad idem between the parties to submit their differences to arbitration. A clause providing for a departmental dispute-resolution mechanism (e.g., decision of the Collector) does not constitute an arbitration agreement.
Lack of Jurisdiction to Appoint Arbitrator: The State Government cannot unilaterally “foist” arbitration on parties to a concluded contract. Section 143-A(3) of the Maharashtra Municipal Councils Act, which provides for policy directions on octroi collection, does not confer the power to appoint an arbitrator.
Waiver/Estoppel: Participation in arbitral proceedings cannot confer jurisdiction where there is no underlying arbitration agreement. The fundamental lack of jurisdiction can be challenged at any stage.

Outcome: The Supreme Court dismissed the special leave petition, affirming that the contract clause was not an arbitration agreement and that the arbitrator lacked jurisdiction, rendering the award a nullity.

7. Service Law (Armed Forces): Permanent Commission for SSC Officers

This set of cases addresses the systemic disadvantage faced by Short Service Commission Officers (SSCOs), particularly women, who were assessed for Permanent Commission (PC) based on records created during a period when they had no prospect of long-term career progression.

A. Indian Navy
Case: Yogendra Kumar Singh v. Union of India & Ors. (and connected matters)
Citation: 2026 INSC 282
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts: Appeals arose from a judgment of the Armed Forces Tribunal (AFT) which directed a fresh Selection Board for SSCOs who were denied PC. The Appellants argued that the process was unfair due to the “Dynamic Vacancy Model” and non-disclosure of criteria.

Key Legal Principles:

Casual Grading of ACRs: The Court held that ACRs of officers who were ineligible for PC were written under the assumption they had no future in the service. This led to average or middling grades, which later became the basis for denying PC, creating an uneven playing field.
Dynamic Vacancy Model: The model, which divided the deficiency in the cadre by 15 and distributed vacancies across batches, was held to be a rational, one-time measure to manage the large number of officers being considered together. The choice of ’15’ as the divisor corresponded to the approximate years of service after PC.
Non-Disclosure of Criteria: The failure to disclose the evaluation criteria, methodology, and vacancy details prior to the Selection Board violated basic norms of fairness and transparency.

Outcome: The Supreme Court allowed the appeals, modifying the AFT’s order. Instead of a fresh Board, the Court directed:

Pension for Released Officers: SSCWOs inducted prior to Jan 2009, and certain male SSCOs, who were considered but not granted PC and are now released, are deemed to have completed 20 years of service and are entitled to pension with arrears from 01.01.2025.
PC for Serving Officers: The categories of officers still in service who were considered in the 2020 Board shall be granted PC, subject to medical and disciplinary clearance.
Future Transparency: The Navy must issue detailed General Instructions prior to future Boards, disclosing vacancies and evaluation criteria.

B. Indian Army
Case: Lt. Col. Pooja Pal & Ors. v. Union of India & Ors.
Citation: 2026 INSC 281
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts: The appeals challenged AFT judgments that dismissed the applications of SSCWOs from 2010-2012 batches who were denied PC in regular No. 5 Selection Boards, holding there was no discrimination.

Key Legal Principles:

Casual ACR Grading: Similar to the Navy case, the Court found that ACRs for SSCWOs were authored when they were ineligible for PC, leading to a systemic pattern of lower gradings compared to male counterparts who had career prospects. This formed an unequal playing field when they were later considered together.
Disparity in Opportunities: SSCWOs were systematically denied criteria appointments and career-enhancing courses (like the Junior Command Course), which impacted the ‘value judgement’ component of their assessment (5 marks), often enough to change the outcome.
Flexibility of Vacancy Cap: The 250 vacancy cap is not sacrosanct and has been breached in the past for operational and policy reasons. It cannot be an absolute bar to relief where the evaluation process itself was unfair.

Outcome: The Supreme Court allowed the appeals of the SSCWOs.

Pension for Released Officers: SSCWOs who were released during the proceedings are deemed to have completed 20 years of service and are entitled to pension (arrears from 01.01.2025).
PC for Serving Officers: SSCWOs who are still in service and achieved the minimum cut-off grade (60%) in the 2020-21 Boards are entitled to PC, subject to medical and disciplinary clearance.
The appeals of the male SSCOs challenging the inclusion of women in the selection pool were dismissed.

C. Indian Air Force
Case: Wg. Cdr. Sucheta EDN & Ors. v. Union of India & Ors.
Citation: 2026 INSC 280
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts: Appeals arose from the denial of PC to SSCWOs who were commissioned in 2007 and considered under a new policy (HRP 01/2019) that introduced, for the first time, minimum performance criteria based on Mandatory In-Service Courses (MISCs) and Categorisation.

Key Legal Principles:

Casual Grading of ACRs: The Court held that ACRs for officers commissioned after 25.05.2006 were authored under the long-standing policy suspension of PC, and thus were never intended to assess suitability for long-term retention.
Abrupt Introduction of Criteria: The sudden implementation of HRP 01/2019, with the first Board held in March 2019 (just months after the policy was issued), deprived officers of a reasonable opportunity to meet the newly introduced Minimum Performance Criteria, particularly the mandatory Categorisation.

Outcome: The Supreme Court allowed the appeals.

Pension for Released Officers: All SSCOs who were considered in the 2019, 2020, and 2021 Boards (even if declared ineligible) are deemed to have completed 20 years of service and are entitled to pension (arrears from 01.01.2025).
Relief for Intervenors: The Intervenor-SSCWOs from later batches (2011) were not granted final relief in this judgment but were allowed to continue pursuing their remedies in the AFT/High Court with the interim stay on release remaining in operation.
Future Transparency: The Air Force must issue General Instructions for future Boards, disclosing vacancies, evaluation criteria, and mark apportionment.

D. Implementation of AU Tayyaba (Air Force)
Case: Sqn. Ldr. Nitu Thapliyal & Ors. v. Union of India & Ors.
Citation: Order in Misc. Application Nos. 1799-1803/2023 in Civil Appeal Nos. 192-196/2012
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts: This was an application to clarify the implementation of the AU Tayyaba judgment regarding pension for SSCWOs. The Court dealt with two issues: (i) three applicants were denied pension for not meeting the 6.5 ACR average; (ii) others sought notional time-scale promotion for pension computation.

Outcome:

Denial of Pension (Low ACRs): The Court upheld the Air Force’s decision, finding no mitigating circumstances to waive the clear eligibility criteria for the grant of PC under HRP 04/10.
Computation of Pension: The Court directed that the clarifications from a previous order (dated 15.04.2024) apply. Pension is to be computed on a notional basis of completing 20 years of service, including increments, but notional promotion to Wing Commander was denied as it would create an artificial equivalence and be conceptually untenable.

E. Male SSCOs (Air Force) – Laches
Case: Neeraj Kumar & Anr. v. Union of India & Ors.
Citation: Civil Appeal No. 640/2025
Coram: Chief Justice Surya Kant, Justices Ujjal Bhuyan and Nongmeikapam Kotiswar Singh

Facts: Two male SSCOs, who had voluntarily sought release from service in 2009, filed an OA in 2011 seeking reinstatement and PC. They relied on the Babita Puniya judgment.

Legal Principle: The Court emphasized that relief in service matters, especially after voluntary retirement, is discretionary and available only to those who approach the court with diligence.

Outcome: The appeal was dismissed. The officers had voluntarily left service, secured alternate employment, and approached the court with significant delay (over two years after their release and 18 months after Babita Puniya). They were not entitled to the same relief as those who acted promptly.

8. Insolvency Law: Set-off & Moratorium

Case: Central Transmission Utility of India Limited v. Sumit Binani & Ors.
Citation: 2026 INSC 284 (23rd March 2026)
Coram: Justices Sanjay Kumar and K. Vinod Chandran

Facts: A power generation company (Corporate Debtor – CD) had deposited Rs. 108.44 crores with the appellant (CTU) as security in lieu of a Letter of Credit (LoC). After the initiation of CIRP, the CTU appropriated this deposit against pre-CIRP and post-CIRP dues. The Resolution Professional (RP) objected, arguing it violated the moratorium. The NCLT and NCLAT directed the entire amount to be adjusted against post-CIRP dues only.

Key Legal Principles:

Set-off under IBC: The Court, relying on Bharti Airtel Ltd. v. Aircel Ltd., held that a set-off of dues payable by the CD for a period prior to the commencement of CIRP cannot be made from the dues payable to the CD after the commencement of CIRP.
Security Deposit vs. Bank Guarantee: The deposit was a security against default, not an independent, unconditional bank guarantee or LoC. Even if it were an LoC, the moratorium under Section 14 of the IBC would have prevented its enforcement to recover pre-CIRP dues.
Operational Creditor & Moratorium: The CTU was an operational creditor. The appropriation of the pre-CIRP dues from the security deposit after the moratorium came into effect was held to be a direct violation of Section 14 of the IBC.
Pari Passu Principle: Permitting such a unilateral set-off would undermine the pari passu principle of the IBC, where all creditors of the same class must be treated equally.

Outcome: The Supreme Court affirmed the orders of the NCLT and NCLAT. The appeals were dismissed. The CTU was directed to adjust the entire security deposit only against the post-CIRP dues. The pre-CIRP dues would have to be processed through the Resolution Plan.

Sarvarthapedia Legal Conceptual Network

I. Core Constitutional & Jurisprudential Anchors

A. Rule of Law & Judicial Review

Connects to: Criminal Law, Arbitration, Service Law, Insolvency
Ensures legality of executive action, adjudicatory fairness, and limits on State power
Cross-links:
- Jurisdictional validity (Arbitration, IBC)
- Evidentiary standards (Criminal Law)
- Administrative fairness (Service Law)

B. Natural Justice & Procedural Fairness

Audi alteram partem, transparency, reasoned decision-making
Cross-links:
- Non-disclosure of criteria (Service Law – PC cases)
- Appreciation of evidence (Sexual assault case)
- Valid consent (Arbitration agreement)

C. Equality & Non-Discrimination (Article 14)

Structural fairness vs formal equality
Cross-links:
- Systemic disadvantage (SSCO Permanent Commission cases)
- SC/ST status exclusion (Conversion case)
- Pari passu principle (IBC)

II. Criminal Law Cluster

A. Appreciation of Evidence

Node: Witness Credibility
- Child witness competency
- Sole testimony of prosecutrix
Node: Corroboration Principle
- Rule of prudence, not law
Node: Contradictions Doctrine
- Minor vs material inconsistencies

Cross-links: