Supreme Court of India
SECURITIES AND EXCHANGE BOARD OF INDIAversusCLASSIC CREDIT LTD.
- Citation
- 2017 INSC 778
- Decided
- 21 August 2017
- Disposal
- Disposed off
- Bench
- S KHEHAR
Holding
A change of forum effected by the SEBI amendments is a procedural amendment that operates retrospectively, so pending proceedings must be transferred to the Court of Session under the 2002 amendment and to Special Courts under the 2014 amendment.
Summary
The Securities and Exchange Board of India (SEBI) filed criminal complaints against Classic Credit Ltd. and other private parties under the SEBI Act, 1992, which originally required trial before a Metropolitan Magistrate or a Judicial Magistrate of the first class. The SEBI (Amendment) Act, 2002 altered Section 26(2) to require that no court inferior to a Court of Session could try SEBI offences, and the SEBI (Amendment) Act, 2014 further created Special Courts for all SEBI offences. The issue was whether these amendments, which changed the forum of trial, operated retrospectively on pending matters and whether the pending cases should be transferred to the newly designated courts. The Court held that a change of forum is a procedural amendment and, absent express saving language, is presumed to operate retrospectively; consequently, pending proceedings were to be transferred to the Court of Session after the 2002 amendment and to Special Courts after the 2014 amendment. The appeal was dismissed.
Issues considered
- The effect of the SEBI (Amendment) Act, 2002 on the forum of trial for pending SEBI cases.
- The effect of the SEBI (Amendment) Act, 2014 on the forum of trial for pending SEBI cases.
- Whether a procedural amendment that changes the forum of trial operates retrospectively in the absence of an express saving clause.
- Whether the right of revision or appeal creates a vested right that can be defeated by a change of forum.
Legislation cited
- Code of Criminal Procedure, 1973s. 190, s. 26, s. 260, s. 262, s. 407, s. 5(3)
- General Clauses Act, 1897s. 6
- Securities and Exchange Board of India Act, 1992s. 24, s. 26(2)
- Securities and Exchange Board of India (Amendment) Act, 2002s. 26(2)
- Securities and Exchange Board of India (Amendment) Act, 2014s. 26A, s. 26B, s. 26C, s. 26D, s. 26E
Subjects
forum of trialprocedural amendmentretrospective operationSEBI ActSpecial Courtsjurisdictionvested rightsummary trialCriminal Procedure Code
Judgment
[2017] 13 S.C.R. 559
SECURITIES AND EXCHANGE BOARD OF INDIA A
v.
CLASSIC CREDIT LTD.
(CriminalAppealNo. 67 of2011)
AUGUST 21, 2017 B
[JAGDISH SINGH KHEHAR, CJI AND ARUN MISHRA, J.]
Securities and Exchange Board of India Act, 1992:
s.26(2) - Amendment causing change offorum of trial - Effect
of. on pending proceedings - Complaints filed u/s. 26(2) against C
private parties for offences punishable under SEBI Act - Offences
allegedly committed before SEBI Amendment Act, 2002 - Trial of
accused by Metropolitan Magistrate or, Judicial Magistrate of the
first class - Amendment to ss. 24 and 26 by the 2002 Amendment
Act whereby change in forum of trial - All pending matters D
transferred to the concerned court of session - Challenge· to - While
matters pending, 2014 Amendment Act' came in, whereby offences
arising under. 'SEBI Act' would be tried by a Special Court - Held:
Change of 'forum' would operate retrospectively, and as such,
pending proceedings would necessarily have to be transferred to
the changed 'forum '-Special Court - 'Forum' of trial earlier vested E
in the Court of Metropolitan Magistrate or, Judicial Magistrate of
the first class after 'the 2002 Amendment Act', was retrospectively
changed to the Court of Session - In view thereof. the trials even in
respect of offences allegedly committed before '2002 Amendment
Act' became operational, whether in respect whereof trial had or
had not been initiated, would stand jurisdictionally vested in a Court F
of Session - Similarly, trials of offences under SEBI Act, consequent
upon '2014 Amendment Act would stand jurisdictionally transferred
for trial to a Special Court, irrespective of whether the offence under
the SEBI Act was committed before '2002 Amendment Act' became
operational and/or before '2014 Amendment Act' became G
operational, and irrespective of the fact whether trial had or had
not been initiated - SEBI (Amendment) Act, 2002 - SEBI
(Amendment) Act, 2014.
Amendment causing change of forum of trial - Nature of -
Held: Change of 'forum' being procedural, the amendment of the H
559
I
560 SUPREME COURT REPORTS [2017] 13 S.C.R.
A 'forum' would operate retrospectively, irrespective of whether the
offence allegedly committed by the accused, was committed prior to
the amendment.
Disposing of the matters, the Court
HELD: 1.1 The adjudicatory 'forum' was not altered at all
B by 'the 2002 Amendment Act'. Section 26(2) of 'the Securities
and Exchange Board of India Act, 1992', as it existed prior to the
2002 amendment, mandated that no Court inferior to that of a
Metropolitan Magistrate (or, a Judicial Magistrate of the first
class) shall try an offence punishable under this Act. The
c contemplated 'forum' of adjudication could be the Court of a
Metropolitan Magistrate (or, a Judicial Magistrate of the first
class), or any other higher court. And not necessarily the Court
of a Metropolitan Magistrate (or, a Judicial Magistrate of the
first class). The higher court which could have tried matters even
before 'the 2002 Amendment Act', could well be the Court of
D Session. And as such, in case of a determination, the trial of
offences under 'the SEBI Act' could have been conducted by a
Court of Session even prior to 'the 2002 Amendment Act', there
would be nothing wrong about it. The provision, as it existed
prior to 'the 2002 Amendment Act', clearly contemplated that
E even a Court of Session could try offences postulated by the
provisions of 'the SEBI Act'. As such, when 'the 2002 Amendment
Act' provided that adjudication of offences under 'the SEBI Act'
would be by a court not inferior to that of a Court of Session, the
position postulated prior to the said amendment cannot be stated
to have been breached. It may well be said to be curtailed from
F the original position. But, it could not be said to be in conflict
with the original position. In a similar manner of understanding,
even after 'the 2014 Amendment Act', which provided that
offences arising under 'the SEBI Act' would be tried by a Special
Court (Section 26B), the position cannot be taken to be at variance
G from the one, as it existed prior to the 2002 amendment, as also,
the position as it existed after 'the 2002 Amendment Act'. The
reason for the above inference is, that a Special Court (notified
by the Central Government) was to be a court which, immediately
before such notification, was the Court of Session or an Additional
Sessions Judge (Section 26A(3)). Therefore, a Special Court was
H a court superior to a Metropolitan Magistrate (or, a Judicial
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 561
CREDIT LTD.
Magistrate of the first class), as contemplated prior to 'the 2002 A
Amendment Act'. It was also the same as the court contemplated
under 'the 2002 Amendment Act', namely, the Court of Session.
Therefore, the projection of the jurisdictional claim, is a mere
furore, without any serious justification. [Para 33] [639-C-H; 640-
A-C]
B
1.2 Procedural amendments are presumed to be
retrospective in nature, unless the amending statute expressly
or impliedly provides otherwise. And also, that generally change
of 'forum' of trial is procedural, and normally following the above
proposition, it is presumed to be retrospective in nature, unless
the amending statute provides otherwise. [Para 34] [640-D-E] c
New India Insurance Co. Ltd. v. Shanti Misra (1975) 2
SCC 840 : [1976] 2 SCR 266; Securities and Exchange
Board of India v. Ajay Agarwal (2010) 3 SCC 765 :
[201 OJ 3 SCR 70; Ramesh Kumar Soni v. State of
Madhya Pradesh (2013) 14 SCC 696 : [2013] 1 SCR D
1129; Hitendra Vishnu Thakur v. State of Maharashtra
(1994) 4 SCC 602 : [1994) 1 Suppl. SCR 360; Ranbir
Yadav v. Stale of Bihar (1995) 4 SCC 392 : [1995) 2
SCR 826; Kamlesh Kumar v. State of Jharkhand (2013)
15 SCC 460 : [2013) 14 SCR 263 - relied on. E
1.3 Alteration of 'forum' has been considered to be
procedural, and that, the change of 'forum' being procedural, the
amendment of the 'forum' would operate retrospectively,
irrespective of whether the offence allegedly committed by the
accused, was committed prior to the amendment. [Para 35] F
[640-F-G]
1.4 The submission that change of 'forum' could be
substantive or procedural, is accepted. It may well be procedural
when the remedy was yet to be availed of, but where the remedy
had already been availed of (under an existing statutory provision), G
the right may be treated as having crystalised into a vested
substantive right. Where the remedy had been availed of prior to
the ameµdment, unless the amending provision by express words,
or by necessary implication, manda.tes the transfer of proceedings
to the 'forum' introduced by the amendment, the 'forum'
postulated by the unamended provision, would continue to have H
562 SUPREME COURT REPORTS [2017] 13 S.C.R.
A the jurisdiction to adjudicate upon pending matters (matters filed
before amendment). In view thereof, no vested right can be
claimed with reference to 'forum', where the concerned court,
had not taken cognizance and commenced trial proceedings, in
consonance with the unamended provision.[Paras 36-37] [642-
C-F]
B
1.5 Insofar as the matters where proceedings had already
commenced before the amendment, change of 'forum' for trial
came into effect, the general principle is that a law which brings
about a change in the 'forum', does not affect pending actions,
unless intention to the contrary is clearly shown. What needs· to
c be determined with reference to 'the 2002 Amendment Act', as
well as, with reference to 'the 2014 Amendment Act' is, whether
an intention to the contrary was expressed therein, so as to alter
the 'forum', where proceedings were pending. And to bring such
proceedings to the 'forum' contemplated by the amendment. [Para
D 38] (642-G-H; 643-Aj
1.6 Section 26, as amended through 'the 2002 Amendment
Act', leaves no room for any doubt, that the erstwhile 'forum'
would cease to be the adjudicatory authority and the newly created
'forum'-the Court of Session, would deal with all pending matters
E as well. The plJirase, "no court inferior to that of a court of session
shall try any offence punishable under this Act", leaves no room
for any doubt, that the erstwhile 'forum' -the Court of Metropolitan
Magistrate (or, Judicial '.\fagistrate of the first class), was denuded
of its jurisdiction. The court having jurisdiction earlier, being a
court inferior to a Court of Session ceased to have the jurisdiction
F to adjudicate matters punishable under 'the SEBI Act', after the
amendment under 'the 2002 Amendment Act' came into force,
on 29.10.2002. There can be no doubt whatsoever, that 'the 2002
Amendment Act', expressly diverted jurisdiction from the
Metropolitan Magistrates (and, Judicial Magistrates of the first
G class) to try offences under 'the SEBI Act', after 'the 2002
Amendment A~t' became operational. The position was similarly
explicit in Section 26B inserted by 'the 2014 Amendment Act',
by use of the words " all offences under this Act committed prior
to the date of commencement of the Securities Laws
(Amendment) Act, 2014 or on or after the date of such
H commencement, shall be tried by the Special Court established
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 563
CREDIT LTD.
for the area in which the offence is committed". There can be no A
doubt whatsoever, that 'the 2014 Amendment Act' grouped all
offences together as one, by providing that all offences committed
prior to or after 'the 2014 Amendment Act', would be tried by a
Special Court. The attempt to segregate the cases arising under
'the SEBI Act' into two categories, is clearly and expressly ruled
B
out, by the language adopted in the provision itself. Section 26B
was categorically explicit, because of the clear intent expressed
therein, that all offences committed under 'the SEBI Act', prior
to the introduction of 'the 2014 Amendment Act', would be tried
by the Special Court. Therefore, there is absolutely no ambiguity,
that after 'the 2014 Amendment Act', proceedings in respect of C
offences committed prior thereto, could only be tried by a Special
Court. [Paras 39-40] [643-A-H]
1. 7 This Court have intentionally overlooked and not
extracted the words " shall be taken cognizance of and tried by
the Special Court", to emphasise that the amendment of 'forum' D
contemplated under Section 26B would be applicable only to
matters where cognizance had not been taken. It is not possible,
either from the language of the provision, or even from the
surrounding circumstances, to arrive at the advocated position.
The legislative intent was clearly contrary to the one suggested.
Ordinarily, cognizance is taken by a magisterial court, whereupon, E
the matter is committed to the concerned higher court, for trial.
The Special Courts (a Court of Session or an Additional Sessions
Judge, in terms of Section 26D(l) of 'the 2014 Amendment Act')
provides for a position different from the provisions contained in
the Code of Criminal Procedure. Now, by 'the 2014 Amendment F
Act', the function of taking cognizance has been vested with Special
Court, conferred with the responsibility to conduct trials.
Therefore, all pending matters where cognizance had been taken
and proceedings had commenced, before the Court of Session,
would not be affected. 'The 2014 Amendment Act' which
provided for a change of 'forum', also authorized a Special Court G
to take cognizance. It is not reasonable to read anything further
into the words highlighted. 'The 2014 Amendment Act' expressly
provided, that for all offences committed even prior to 'the 2014
Amendment Act, proceedings would be conducted only before
the Special Court. The provision itself therefore expressly H
564 SUPREME COURT REPORTS [2017J 13S.C.R.
A mandated, that the change of 'forum' would operate
retrospectively, and as such, pending proceedings would
necessarily have to be transferred to the changed 'forum' - the
Special Court. For the reasons recorded, it is held that even for
such matters where trial had commenced under the unamended
provision, after the amendments, which has been held to be
B
operatiom)I retrospectively, the trial would move to the changed
'forum' (to the Court of Session, after 'the 2002 Amendment Act'
and, to the Special Court, after 'the 2014 Amendment Act'). fPara
41] 1644-A-G]
1.8 The classification of offences other than the offences
cunder the Penal Code, and the courts by which such offences
would be triable, expressed in Part II of the F'irst Schedule, must
essentially be read with Section 26 CrPC. Part II of the First
Schedule, would therefore be applicable only in cases where, the
other laws (-other than the Penal Code) do not postulate the
D adjudicatory court. In such cases, offences (-provided for under
other laws~ if punishable with death, imprisonment for life or
imprisonment for more than seven years, would be tried by a
Conrt of Session, and where, the offence in question was
punishable with imprisonment for three years and upwards, but
not more tlrnn seven years, the adjudicatory court would be the
E Court of Magistrate of the first class. And if, the punishment of
the offence is imprisonment for less than three years or with fine
only, the matter would be triable by any Magistrate. The
contingencies contemplated in Part II of the First Schedule
(appended to the CrPC), are clearly inapplicable to 'the SEBl
F Act' on account of the fact, that the adjudicatory court (prior to
'the 2002 Amendment Act'), was a court not inferior to that of
the Metropolitan Magistrate (or, a Judicial Magistrate of the first
class), after 'the 2002 Amendment Act', it was a court not inferior
to a Court of Session, and finally, after 'the 2014 Amendment
Act', adjudication was vested with Special Courts. Therefore, at
G no stage was there any ambiguity of 'forum' for trial which would
deal with offences postulated under 'the SEBI Act'. fPara 49)
f651-H] f652-A-E)
1.9 Th,e legislative intent in matters falling in Section 26(b)
CrPC, for holding summary proceedings has been express. In
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 565
CREDIT LTD.
the absence of any similar provision under 'the SEBI Act', it is A
natural to assume, that summary proceedings were riot
contemplated by the legislation, and has to be considered as
pr\ecluded. In the absence of an express provision for holding
summary proceedings in the trial of offences under 'the SEBI
Act', it is not possible to accept the submission, by merely relying B
on Section 260 CrPC. [Para 50] [653-E-F]
1.10 Section 26(2) of 'the SEBI Act' (prior to 'the 2002
Amendment Act') expressly provided, "no court inferior to that
of a Metropolitan Magistrate (or, a Judicial Magistrate of the
first class) shall try an offence punishable under this Act". It is
thus, apparent, that it was not imperative, that the 'forum' for c
trial of offences under the unamended Section 24 of 'the SEBI
Act' would be conducted only by a Metropolitan Magistrate (or,
a Judicial Magistrate of the first class). Trials for offences under
'the SEBI Act', even prior to 'the 2002 Amendment Act', could
well have been conducted by a Court of Session, or an Additional D
Sessions Judge. If trial had actually been vested in such a superior
court (as the same was possible), Section 260 CrPC, would not
have been applicable, as Section 260 comes into play only for ·
trials by courts of Chief Judicial Magistrates, Metropolitan
Magistrates and Judicial Magistrates of the first class. For th.e
instant reason also, the provision of Section 260 CrPC, cannot E
be so interpreted. Since the applicability of Section 260 CrPC to
proceedings under 'the SEBI Act' has not been accepted, the
prejudice claimed on behalf of the accused under Section 262
CrPC (which is dependent on Section 260) can also not be
accepted. [Para 51] (653-F-H; 654-A-C] F
1.11 It was submitted that the right of revision available to
the accused, prior to the amendment to 'the SEBI Act', has been
taken away; that this aspect also had substantive (and, not merely
procedural) implications for the accused; that the right of revision
being a valuable right of the accused, the deprivation of the above G
valuable right, emerging from the change of'forum' from the Court
of the Metropolitan Magistrate (or, Judicial Magistrate of the
first class) by 'the 2002 Amendment Act', and by 'the 2014
Amenc;Iment Act', should not be considered as a trivial procedural
issue; that the taking away of the right ofrevision from an accused,
H
566 SUPREME COURT REPORTS [2017] 13 S.C.R.
A has to be considered as a substantial procedural deprivation; that
cases where an amending enactment, takes away favourable
rights, by replacing the same with an alternative which is less
advantageous, would violate the fundamental rights of the
accused; thus, it was submitted that the right of revision which
was vested in the accused under Section 397 rw Section 401 CrPC,
B
was available to the accused under the unamended provisions of
'the SEBJ Act', when adjudication for offences under 'the SEBJ
Act' was ve~ted with a Metropolitan '.\1agistrate (or, a Judicial
Magistrate of the first class); that since the adjudicatory procedure
for holding trials for offences under 'the SEBJ Act' was vested
c with a Court of Session (under 'the 2002 Amendment Act'), and
thereafter, with the Special Court (consequent upon 'the 2014
Amendment Act'), the accused who have not been tried (prior to
the above amendments), stood deprived of the right of revision,
under Section 397 rw Section 401 CrPC; thus, the amendment of
'forum' of trial, could not be treated as a mere procedural
D
amendment, but was liable to be considered as having substantive
adverse implication for the accused; and that the action of transfer
of pending matters from the Court of Metropolitan '.\1agistrate
(or, Judicial Magistrate of the first class), to the Court of Session
(consequent upon 'the 2002 Amendment Act') and thereafter, to
E the Special (::ourt (consequent upon 'the 2014 Amendment Act'),
was liable to be treated as prospective, failing which the accused
will be deprived of the important right of revision vested in him.
In view thereof, namely, that power of revision to a superior court
does not confer or create a corresponding right in the litigant, it
is not possible to accept the submission. When the remedy of
F
revision is considered as not a right of an accused, at all, the
absence of the remedy of revision cannot be considered as
deprivation of a right. [Paras 52, 53-54[ [654-D-F; 657-B-D; 658-
C-E]
1.12 The 'forum' for trial earlier vested in the Court of
G Metropolitan Magistrate (-or, Judicial Magistrate of the first
class) was retrospectively amended, inasmuch as, the 'forum' of
trial after 'the 2002 Amendment Act' was retrospectively changed
to the Court of Session. Jn this view of the matter, the trials even
in respect of offences allegedly committed before 29.10.2002
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 567
CREDIT LTD.
(-the date with effect from which, 'the 2002 Amendment Act' A
became operational), whether in respect whereof trial had or had
not been initiated, would stand jurisdictionally vested in a Court
of Session. And likewise, trials of offences under the SEBI Act,
consequent upon 'the 2014 Amendment Act (which became
operational, with effect from 18.07 .2013) would stand B
jurisdictionally transferred for trial to a Special Court, irrespective
of whether the offence under the SEBI Act was committed before
29.10.2002 and/or before 18.07.2013 (the date with effect from
which 'the 2014 Amendment Act' became operational), and
irrespective of the fact whether trial had or had not been initiated.
The conclusion affirms the determination recorded by the Delhi C
High Court in Mahender Singh v. High Court of Delhi that after
the amendment of s. 26 by the 2002 Amendment Act, offences
under the SEBI Act' were to be tried by a Court of Session. The
impugned judgment rendered by the High Court of Bombay in
Mis. Classic Credit Ltd. v. State of Maharashtra) is set aside. [Para D
56] [661-D-H; 662-A]
Union of India v. Sukumar Pyne AIR 1966 SC 1206 ;
[1966] SCR 34; Ramesh Kumar Soni v. State of Madhya
Pradesh (2013) 14 SCC 696 : [2013] 1 SCR 1129;
Kam/esh Kumar v. State of Jharkhand (2013) 15 SCC
460 ; [2013] 14 SCR 263; Rajendra Kumar v. Ka/yan E
(2000) 8 SCC 99 : [2000] 2 Suppl. SCR 114; Nani
Gopa/ Mitra v. State of Bihar AIR 1970 SC 1636 :
[19691 SCR 411; Securities and Exchange Board of
India v. Ajay Agarwal (2010) 3 SCC 765 : [2010] 3
SCR 70; A.R. Antulay v. R.S. Nayak (1988) 2 SCC 602 F
; [1988] 1 Suppl. SCR 1; Ramesh Kumar Soni v. State
of Madhya Pradesh (2013) 14 SCC 696 : 1201311 SCR
1129; Commissioner of Income Tax, Orissa v. Dhadi
Sahu (1994) Suppl. 1 SCC 257 : [1992] 3 Suppl. SCR
168; R. Kapilnath v. Krishna (2003) 1 SCC 444 : [2002]
5 Suppl. SCR 66; Videocon International Limited v. G
Securities and Exchange Board of India (2015) 4 SCC
33 : [2015] 3 SCR 1; Amba/al Sarabhai Enterprises
Ltd. v. Amrit Lal & Co. (2001) 8 SCC 397 : [20011 2
Suppl. SCR 195; Commissioner of Income Tax,
H
568 SUPREME COURT REPOR'fS [2017] 13 S.C.R.
A Bangalore v. R. Shradamma (1996) 8 SCC 388: [1996)
3 SCR 1200; Shankar Ramchandra Abhyankar v.
Krishnaji Dattatreya Bapat (1969) 2 SCC 74 : [1970)
l SCR 322; Devender Kumar Sing/a v. Baldev Krishan
Sing/a (2005) 9 SCC 15 : [2004) 2 SCR 459; Pranab
Kumar Mitra v. State of West li<'ngal AIR 1959 SC 144
B
: [1959) Suppl. SCR 63; Union of India v. A.K. Pandey
(2009) 10 SCC 552 : [2009) 14 SCR 528; Manna/al
Khetan v. Kedar Nath Khetan (1977) 2 SCC 424 :
J 1977] 2 SCR 190; Manujendra Dutt v. Purnedu Prasad
Roy Chowdhury AIR 1967 SC 1419: [1967] SCR 475;
c Mohd Idris v. Sat Narain AIR 1966 SC 1499 : [1966)
SCR 15; Stale of West Bengal v. Anwar All Sarkar Habib
Mohamed AIR 1952 SC 75: [1952) SCR 284; Krishnan
i~ Krishnaveni (1997) 4 SCC 241 : )1997] 1 SCR 511
- referred to.
D Case Law Reference
[1966) SCR 34 referred to Para 13(i),44
r20BJ 14 sen. 263 referred to Para 13(iii),14(i),
27,29,44
E [2000) 2 Suppl. SCR 114 referred to Para 13(iv)
[1969) SCR 411 referred to Para 14(ii),36,44
[1988] 1 Suppl. SCR I referred to Para 14(iv),52
[2013 J I SCR 1129 referred to Para 20,36
F [1992] 3 Suppl. SCR 168 referred to Para 23, 26, 36
[2002] 5 Suppl. SCR 66 referred to Para 23, 26,36
[2015] 3 SCR 1 referred to Para 24,36
[2001] 2 Suppl. SCR 195 referred to Para 25,36
G
(1996) 3 SCR 1200 referred to Para 26
[1970) I SCR 322 referred to Para 27
[2004] 2 SCR 459 referred to Para 29
[1959] Suppl. SCR 63 referred to Para 29
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 569
CREDIT LTD.
12009] 14 SCR 528 referred to Para 31 A
[1977] 2 SCR 190 referred to Para 31
11976] 2 SCR 266 relied on Para 34
[2010] 3 SCR 70 relied on Para 34
[2013] 1 SCR 1129 relied on Para 34 B
[1994] 1 Suppl. SCR 360 relied on Para 34
[1995] 2 SCR 826 relied on Para 34
[2013] 14 SCR 263 relied on Para 34
[1967] SCR 475 referred to Para 36 c
[1966] SCR 15 referred to Para36
[2001] 2 Suppl. SCR 195 referred to Para36
(1952] SCR 284 referred to Para 52
D
(1997] 1 SCR 511 referred to Para 53
CRIMINAL/CIVILAPPELLATE/ORIGINAL JURISDICTION:
Criminal Appeal No. 67 of201 l.
From the final Judgment and Order dated 16-01-2008 passed by
the High Court of Judicature at Bombay in Criminal Appeal No.1557 of E
2007
WITH
Cr!. Appeal Nos. 66 to 73 of2011, C.A. Nos. 102-103 of2011,
Cr!. Appeal No. 1096 of 2013, W.P. (Cr!.) No. 67 of 2016, Cr!. Appeal
No. 1450 of2017, C.A. No.10729/2017. F
Ms. Pinky Anand,ASG, Sanjay Mann, Rishabh Jain, Vinay Kumar,
Ms. Saudamini, R.K. Pillai (for Ms. Rekha Pandey), D.P. Singh,
Ms.Nishtha Chaturvedi, Ms. Sonam Gupta, Sanjay Jain, J itendra Kumar,
Vikas Mahajan, Vishal Mahajan, Vinod Sharma, Amarnath Singh (for
BhaskarY. Kulkarni), SantoshPaul, JosephAristotle, Ms. Swati Singh, G
Ms. K. Priyadarshini, Ms. Priya Aristotle, Advs. for the Appellant.
C.A. Sundaram, Sr. Adv., Jatin Zaveri, Neel Kamal Mishra,
Ms. Rohini Musa, Abhishek Gupta, Santosh Paul, Ms. Swati Singh (for
M.J. Paul), Gaurav Agrawal, Ms. Kamini Jaiswal, Ms. ShumailaAltaf,
H
570 SUPREME COURT REPORTS [2017] 13 S.C.R.
A Jatinderpal Singh Grewal, Sushi! Karanjkar (for K.N. Rai), A.Subba
Rao, Annam Venkatesh, Sudipto Sircar, Abhinav Goyal, Rahul Mishra,
Kushank Sindhu (for Annam D.N. Rao), Advs. for the Respondent.
The Judgment of the Court was delivered by
JAGDISH SINGH KHEHAR, CJI I. Leave granted, in all the
B special leave petitions.
2. Complaints were filed against the private parties herein, for
offences punishable under the Securities and Exchange Board of India
Act, 1992 (hereinafter referred to as 'the SEBI Act'). At the time when
the complaints were filed under Section 26(2) of 'the SEBI Act', the
c concerned accused were to be tried by a Metropolitan Magistrate (or, a
Judicial Magistrate of the first class). In this bunch of cases, the
contention before this Court, at the behest of the private parties is, that
for offences allegedly committed before 29.10.2002 (whether or not,
taken up for trial before 29 .10.2002) the trial was to be conducted by the
D concerned Metropolitan Magistrate (or, a Judicial Magistrate of the first
class), and none other. It is relevant to record, that in these cases
complaints filed against the private parties herein, pertain to allegations
of commission or omission, prior to 29.10.2002. In some of these matters,
proceedings were initiated prior to 29.10.2002, while in others, it was
initiated after 29.10.2002. The above contention pertaining to the 'forum',
E for trial by a Metropolitan Magistrate (or, a Judicial Magistrate of the
first class), was premised on a purely legal assertion, founded on the
format of Sections 24 and 26 of'the SEBIAct', as they existed prior to
the Securities and Exchange Board of India (Amendment) Act, 2002
(hereinafter referred to as 'the 2002 Amendment Act'). It was the
F submission of the private parties, that the amended provisions under 'the
2002 Amendment Act' had no express or implied retrospective effect,
and therefore, the amendment carried out through 'the 2002 Amendment
Act', would not have any impact, particularly on the 'forum' for trial (-
the Court of Metropolitan Magistrate, or Judicial Magistrate of the first
class). It was submitted, that trial in all these matters, with reference to
G offences committed prior to 29. l 0.2002, whether or not put to trial, could
only be conducted by the Metropolitan Magistrate (or, Judicial Magistrate
of the first class).
3. In order to appreciate the gamut of the submissions advanced,
it is imperative to extract hereunder, Sections 24 and 26 of 'the SEBI
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 571
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
Act', in the format in which the provisions existed, prior to 'the 2002 A
Amendment Act'. The same are accordingly reproduced below:
"24. Offences. -(I) Without prejudice to any award of penalty by
the adjudicating officer under this Act, if any person contravenes
or attempts to contravene or abets the contravention of the
provisions of this Act orof any rules orregulations made thereunder, B
he shall be punishable with imprisonment for a term which may
extend to one year, or with fine, or with both.
(2) Ifany person fails to pay the penalty imposed by the adjudicating
officer or fails to comply with any of his directions or orders, he
shall be punishable with imprisonment for a term which shall not C
be less than one month but which may extend to three years or
with fine which shall not be less than two thousand rupees but
which may extend to ten thousand rupees or with both.
xxx xxx xxx
26. Cognizance of offences by courts.-(!) No court shall take D
cognizance of any offence punishable under this Act or any rules
or regulations made thereunder, save on a complaint made by the
Board.
(2) No court inferior to that of a Metropolitan Magistrate or a
Judicial Magistrate of the first class shall trv an offence punishable E
under this Act."
It is also necessary to notice the change brought in, on the subject
of 'forum' for trial, by 'the 2002 Amendment Act'. Even though, the
change of 'forum' was expressed in the amended Section 26(2), yet
some of the submissions advanced during the course of hearing, emerged F
out of a collective reading of the amended Sections 24 and 26 (-by 'the
2002 Amendment Act'). Accordingly, the format which Sections 24 and
26 of 'the SEBI Act' assumed, after 'the 2002 Amendment Act' also
needs to be noticed. The above amended provisions, are accordingly
reproduced below:
G
"24.0ffences. -(1) Without prejudice to any award of penalty by
the adjudicating officer under this Act, if any person contravenes
or attempts to contravene or abets the contravention of the
provisions of this Act or of any rules or regulations made thereunder,
he shall be punishable with imprisonment for a term which may
H
572 SUPREME COUR~- REPORTS (2017] 13 S.C.R.
A extend tu te_11 years, or with fine, which may extend tu twe11!X::
five crure rupees or with both.
(2) If any qerson fails to pay the.Penalty imposed by the adjudicati!!g
officer_9r fails to comply with any of]lis directions or orders, he
shall be punishable with imprisonment for a term whkh shall not
B be less than one month but which may extend t_u ten years ur with
fine, which may extend to twenty-five crure rupees or with both.
xxx xxx
26. Cognizance of offences by courts.-(!) No court shall take
cognizance of any offence punishable under this Act or any rules
c or regulations made thereunder, save on a complaint made by the
Board.
(2) No coµrt inferior to that ofa Court of Session shall_try any
offence punishable under this AcJ."
4. After 'the 2002 Amendment Act', all pending matters (-before
D
Metropolitan Magistrates, or Judicial Magistrates ufthe first class) were
committed to the concerned, Court of Session. This was done, under
the assumption, that 'the 2002 Amendment Act' had the effect of
retrospec.tively altering the 'forum· for trial. And as such, matters which
were being tried by Metropolitan Magistrates (or, Judicial Magistrates
E of the first class), and were pending before such Courts, were transferred
to the concerned Court of Session. The above change of 'forum' for
trial, was assailed by some of the private parties, before the court to
which the matters were committed. Their challenge failed. The matters
were then carried, to the jurisdictional High Court, i.e., the High Court of
Judicature at Bombay (hereinafter referred to as, 'the Bombay High
F
Court'). Alternatively, some of the private parties, directly approached
the jurisdictional High Court, to assail the changed ·forum' of trial.
5. Before the Bombay High Court, the SEBI supported the
determination rendered by the Court uf Session, and also, placed reliance
G on a decision rendered by the High Court uf Delhi at New Delhi
(hereinafter referred to as 'the Delhi High Court') in Panther Fincap
and Management Services Ltd. v. Securities and Exchange Board of
India (decided on 5.9.2006), wherein it had been concluded, that the
amendment to Section 26 of 'the SEBI Act' through 'the 2002
Amendment Act', related to a change in 'forum' of trial, and therefore,
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 573
CREDIT LTD. (JAGDISH SINGH KHEHAR, CJ!]
the amendment was only procedural. And consequently, an amendment A
of procedure being impliedly retrospective, the Delhi High Court held,
that the committal of pending cases to the Court of Session, was justified
in law.
6. A Division Bench of the Bombay High Court, through the
impugned judgment dated 16.01.2008, collectively disposed of all matters B
pending before it, by setting aside the judgment rendered by the Court of
Session, by taking a view different from the one recorded by the Delhi
High Court. The SEBI therefore approached this Court to assail the
judgment rendered by the Bombay High Court. Some of the cases in
this group of cases (being collectively disposed of through the instant
judgment), arise out of the judgment of the Bombay High Court dated C
16.01.2008. All the remaining cases, arise out of a similar sequence of
events, which culminated before the Delhi High Court, wherein the lead
judgment was rendered in Mahender Singh v. High Court of Delhi (Writ
Petition (C) No.141 of2007, decided on 11.01.2008). It is apparent, that
the above judgment of the Delhi High Court dated 11.01.2008, was D
rendered just a few days before the impugned judgment was rendered
by the Bombay High Court, on 16.01.2008.
7. Consequent upon an interpretation of the amendment to Section
26 by 'the 2002 Amendment Act', the Division Bench of the Delhi High
Court, through the above judgment dated 1I.01.2008 (as already noticed E
above), held that after the amendment of Section 26 by 'the 2002
Amendment Act', offences under 'the SEBJ Act', were to be tried by a
Court of Session. It is also necessary for us to mention, that the Bombay
High Court did not refer to the above judgment dated I 1.01.2008, since
it may not have come to its notice, as the Bombay High Court had
reserved orders in the matter on 22.02.2007 - well before the Division F
Bench of the Delhi High Court, had pronounced its judgment (- on
I I .0 I .2008). The judgment dated I 1.01.2008 rendered by the Delhi High
Court (recording a view, contrary to that expressed by the Bombay High
Court) has been assailed by private parties, affected by the change of
'forum' of trial, from the Court of Metropolitan Magistrate (or, a Judicial G
Magistrate of the first class), to the Court of Session.
8. Whilst these matters were pending before this Court, 'the SEBI
Act' was again amended, by the Securities and Exchange Board of
India (Amendment) Act, 2014 (hereinafter referred to, as 'the 2014
Amendment Act'). It is relevant for the present controversy to notice, H
574 SUPREME COURT REPORTS [2017] :3 S.C.R.
A that by 'the 201AAmendmentAct', Section 26(2) was omitted from 'the
SEBI Act', and Sections 26A to 26E were inserted therein, with effect
from 18.07.2013. During the course of hearing, one of the contentions
advanced by learned counsel representing SEBI was, that the effect
and impact of 'the 2002 Amendment Act' with reference to the change
of 'fomm' for ttial under Section 26(2), from the Metropolitan Magistrate
B
(or, the Judicial Magistrate of the first class), to the Court of Session,
had again been altered. It was submitted, that all pending matters were
now to be tried by a Special Court, in terms of 'the 2014 Amendment
Act', and therefore, all the cases in hand, had been rendered infiuctuous,
because now tine 'fomm' for trial had again been changed. The instant
c position, canvassed on behalfof'the SEBI', was seriously contested by
learned counsel representing the private parties. Having examined the
contention, we are of the considered view, that it is imperative for us
(during the course of the present adjudication), to render a determination
on the effect and impact of 'the 2014 Amendment Act', as well. It is
therefore, that learned counsel for the rival parties were heard, and they
D
advanced detailed submissions on this aspect of the matter, as well.
9. Since we will also be dealing with the jurisdictional effect of
'the 2014 Amendment Act', to matters where the offence(s) was/were
committed before 29. l 0.2002 (whether or not, put up for trial before
29.10.2002). It is necessary for us, to extract herein Sections 26A to
E 26E inserted i11to 'the SEBI Act' through 'the 2014 Amendment Act'.
The above provisions are accordingly reproduced below:
"26A. Establishment of Special Courts.-(!) The Central
Government may, for the purpose of providing speedy trial of
offences under this Act. by notification, establish or designate as
F many Special Courts as ma.x_knccessary.
(2) A Special Court shall consist of a single judge who shall be
appointed by the Central Government with the concurrence uf
the Chief Justice of the High Court within whose jurisdiction the
judge to be appointed is working.
G
(3) A person shall not be qualified for appointment as a judge of a
Special Court unless he is, immeiliately before such appointment,
holding the office of a Sessions Judge or an Additional Sessions
Judge, as the case may be.
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 575
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!)
26B. Offences triable by Special Courts.- Notwithstanding A
anything contained in the Code of Criminal Procedure, 1973 (2 of
1974), all offences under this Act committed prior to the date of
commencement of the Securities Laws (Amendment) Act, 2014
or on or after the date of such commencement, shall be taken
cognizance of and tried by the Special Court established for the
B
area in which the offence is committed or where there are more
Special Courts than one for such area, by such one of them as
may be specified in this behalf by the High Court concerned.
26C. Appeal and revision.- The High Court may exercise, so far
·as may be applicable, all the powers conferred by Chapters XXIX
and XXX of the Code of Criminal Procedure, 1973 (2of1974) on c
a High Court, as if a Special Court within the local limits of the
jurisdiction of the High Court were a Court of Session trying cases
within the local limits of the jurisdiction of the High Court.
26D. Application of Code to proceedings before Special Court.:
( 1) Save as otherwise provided in this Act. the provisions of the D
Code of Criminal Procedure, 1973 (2of1974) shall apply to the
proceedings before a Special Court and for the purposes of the
said provisions. the Special Court shall be deemed to be a Court
of Session and the person conducting prosecution before a Special
Court shall be deemed to be a Public Prosecutor within the meaning E
of clause (u) of section 2 of the Code of Criminal Procedure,
1973 (2of1974).
(2) The person conducting prosecution referred to in sub-section
(1) should have been in practice as an advocate for not less than
seven years or should have held a post, for a period of not less F
than seven years, under the Union or a State, requiring special
knowledge oflaw.
26E. Transitional provisions.-Any offence committed under this
Act, which is triable by a Special Court shall, until a Special Court
is established, be taken cognizance of and tried by a Court of G
Session exercising jurisdiction over the area, notwithstanding
an:Ything contained in the Code of Criminal Procedure, 1973 (2 of
1~74):
Provided that nothing contained in this section shall affect the
H
576 SUPREME COURT REPORTS [2017] 13S.C.R.
A powers of the High Court under section 407 of the Code of Criminal
Procedure, 1973 (2 of 1974) to transfer any case or class of cases
taken cognizance by a Court of Session under this section.".
10. Ms. Pinky Anand, leamedAdditional Solicitor General of India,
whilst appearing on behalf of the SEBI, laid the foundation of her
B submissions by asserting, that it was a settled proposition of law, that
alteration of substantive law is always presumed and treated as having
only prospective implications, unless the legislative enactment itself,
expressly or impliedly mandates it to be retrospective. And in
contradistinction to the above, it was submitted, that an amendment to a
procedural enactment is always presumed and treated to have
c retrospective effect, except when intended otherwise, expressly or
impliedly, through the legislation itself. Accordingly, it was asserted, that
change of 'forum' for trial, having merely procedural connotations, the
same was bound to be treated as retrospective, especially because there
was no express or implied intent in the legislative enactments ('the 2002
D Amendment Act'; and 'the 2014AmendmentAct') thatthe amendments
were intended to have prospective effect.
11. Additionally, it was submitted, that in the facts and
circumstances of this case, there would be absolutely no prejudice caused
to the private parties, by change of 'forum' for trial, firstly, by transfer of
E proceedings from the Metropolitan Magistrates (or, the Judicial
Magistrate~ of the first class), to the Court of Session, and thereafter, by
the transfer of proceedings from the Court of Session, to that of the
Special Court. The absence of any alleged prejudice to the accused, in
the pleadings filed on behalf of the private parties before this Court, and
the absence of any such submissions, during the course of hearing (to
F demonstrate prejudice), according to learned counsel, leave no room for
any doubt, that the litigation initiated by the private parties, based on the
above mentioned jurisdictional issue, was only a ploy to delay the
prosecution initiated against them, by SEBI.
12. It was also the contention of the learned Additional Solicitor
G General representing SEBI, that 'the SEBI Act' was an enactment, which
provided for a wholesome special procedure to deal with criminal
implications, on account of the violation of the provisions of'the SEBI
Act'. It was submitted, that the provisions of 'the SEBI Act', were
separate and distinct, from the general provisions contained in the Code
of Criminal Procedure. Since, according to learned counsel, a special
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 577
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
enactment is always presumed to have an overriding effect over a general A
enactment, the postulation-of a special 'forum' under 'the SEBI Act',
would have an overriding effect, over the general provisions contained
in the Code of Criminal Procedure. It was also submitted, that 'the SEBI
Act' provided a complete code for prosecution of offences under 'the
SEBI Act', and as such, reference to the provisions of the Code of B
Criminal Procedure, on the subject(s) expressly provided for, included
the 'forum' for trial, would not be proper.
13. In order to substantiate her contention, that alteration in
procedure, had an implied retrospective effect, and further, that there
was no vested right with a litigant, on a matter of procedure, learned
Additional Solicitor General, placed reliance on a number ofjudgments. c
We shall first endeavour to refer to the same hereunder:
(i) In the first instance, reliance was placed on Union oflndia v.
Sukumar Pyne, AIR 1966 SC 1206, a judgment rendered by a Constitution
Bench, wherein this Court observed as under:
D
"9. Mr Chatterjee, the learned counsel for the respondent, urges
that a substantive vested right to be tried by an ordinary Court
existed before the amendment, and he relied on Maxwell 11th
Edn., p. 217. where it is stated that "the general principle, however,
seems to be that alterations in procedure are retrospective. unless
there be some good reason against it." He says that there is a E
good reason ifthe principles of Art. 20 are borne in mind. In our
opinion, there is force in the contention of the learned Solicitor-
General. As observed by this Court in 1953 SCR 1188: (AIR 1953
SC 394) a person accused of the commission of an offence has
no vested right to be tried by a particular Court or a particular F
procedure except insofar as there is any constitutional objection
by way of discrimination or the violation of any other fundamental
right is involved. It is well recognized that "no person has a vested
right in any course of procedure" (vide Maxwell 11th Edn., p.
216). and we see no reason why this ordinary rule should not
prevail in the present case. There is no principle underlying Art. G
20 of the Constitution which makes a right to any course of
procedure a vested right. Mr Chatterjee complains that there is
no indication in the Amending Act that the new procedure would
be retrospective and he further says that this affects his right of
appeal under the Criminal Procedure Code. But if this is a matter H
578 SUPREME COURT REPORTS (20 l 7] 13 S.C.R.
A of procedure, then it is not necessary that there should be a special
provision to indicate that the new procedural law is retrospective.
No right of appeal under the Criminal Procedure Code is affected
because no proceedings had ever been started under the Criminal
Procedure Code."
B (ii) Reliance was then placed on Ramesh Kumar Soni v. State of
Madhya Pradesh, (2013) 14 SCC 696, wherefrom, our attention was
drawn to the following observations:
"2. The1 factual matrix in which the controversy arises may be
summarised as under: Crime No. 129 of2007 for commission of
c offences punishable under Sections 408, 420, 467, 468 and 471
!PC was registered against the appellant on 18-5-2007, at
Bheraghat Police Station. On the date of the registration of the
case thq offences in question were triable by a Magistrate of
First Class in terms of the First Schedule of Code of Criminal
Procedure, 1973. That position underwent a change on account
D of the Cede of Criminal Procedure (Madhya Pradesh Amendment)
Act of2007 introduced by Madhya Pradesh Act 2 of2008 which
amended the First Schedule of the 1973 Code and among others
made offences under Sections 467, 468 and 4 71 !PC triable by
the Court of Session instead of a Magistrate of First Class. The
E 11mendment received the assent of the President on 14-2-2008
and was published in Madhya Pradesh Gazette (Extraordinary)
on 22-2-2008.
xxx xxx xxx
9. Having said so, we may now examine the issue from a slightly
F different angle. The question whether any law relating to forum
of trial is procedural or substantive in nature has been the subject-
matter of several pronouncements of this Court in the past. We
may refer to some of these decisions, no matter briefly.
10. In New India Insurance Co. Ltd. v. Shanti Misra (1975) 2
G SCC 840, this Court was dealing with the claim of payment of
compensation under the Motor Vehicles Act. The victim of the
accident had passed away because of the vehicular accident before
the constitution of the Claims Tribunal under the Motor Vehicles
Act, 1939, as amended. The legal heirs of the deceased filed a
claim petition for payment of compensation before the Tribunal
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 579
CREDIT LTD. (JAGDISH SINGH KHEHAR, CJ!]
after the Tribunal was established. The question that arose was A
whether the claim petition was maintainable having regard to the
fact that the cause of action had arisen prior to the change of the
forum for trial of a claim for pavment of compensation. This Court
. held that the change of law operates retrospectively even if the
cause of action or right of action had accrued prior to the change
B
of forum. The claimant shall, therefore, have to approach the forum
as per the amended law. The claimant, observed this Court, had a
"vested right of action" but not a "vested right of forum". It also
held that unless by express words the new forum is available only
to causes of action arising after the creation of the forum, the.
general rule is to make it retrospective. The following passages c
are in this regard apposite: (SCC pp. 844-45, paras 5-6)
"5. On the plain language of Sections 110-A and II 0-F there
should be no difficulty in taking the view that the change in law
was merely a change of forum i.e. a change of adjectival or
procedural law and not of substantive law. It is a well- D
established proposition that such a change of law operates
retrospectively and the person has to go to the new forum
even if his cause of action or right of action accrued prior to
the change of forum. He will have a vested right of action but
not a vested right of forum. If by express words the new forum
E
is made available only to causes of action arising after the
creation of the forum, then the retrospective operation of the
law is taken away. Otherwise the general rule is to make it
retrospective. The. expressions 'arising out of an accident'
occurring in sub-section (1) and 'over the area in which the
accident occurred', mentioned in sub-section (2) clearly show F
that the change of forum was meant to be operative
retrospectively irrespective of the fact as to when the accident
occurred. To that extent there was no difficulty in giving the
answer in a simple way. But the provision of limitation of 60
days contained in sub-section (3) created an obstacle in the
straight application of the well-established principle of law. If G
the accident had occurred within 60 davs prior to the constitution
of the tribunal then the bar oflimitation provided in sub-section
(3) was not an impediment. An application to the tribunal could
be said to be the only remedy. If such an application. due to
H
580 SUPREME COURT REPORTS [2017] 13 S.C.R.
A one reason or the other, could not be made within 60 days then
the tribunal had the power to condone the delay under the
proviso. But if the accident occurred more than 60 days before
the constitution of the tribunal then the bar oflimitation provided
in sub-section (3) of Section 110-A on its face was attracted.
This difficulty of limitation led most of the High Courts to fall
B
back upon the proviso and say that such a case will be a fit one
where the tribunal would be able to condone the delay under
the proviso to sub-section (3), and led others to say that the
tribunal will have no jurisdiction to entertain such an application
and the remedy of going to the civil court in such a situation
c was not barred under Section l l 0-F of the Act. While taking
the latter view the High Court failed to notice that primarily
the law engrafted in Sections 110-A and ! I 0-F was a law
relating to the change of forum.
6. In our opinion in view of the clear and unambiguous language
D of Sections 110-A and 110-F it is not reasonable and proper to
allow the law of change of forum give way to the bar of
limitation provided in sub-section (3) of Section 110-A. It must
be vice versa. The change of the procedural law of forum
must be given effect to. The underlying principle of the change
of law brought about by the amendment in the year 1956 was
E to enable the claimants to have a cheap remedy of approaching
the claims tribunal on payment of a nominal court fee whereas
a large amount of ad valorem court fee was required to be
paid in civil court."
11. In Hitendra Vishnu Thakur v. State of Maharashtra ( 1994) 4
F SCC 602, one of the questions which this Court was examining
was whether clause (bb) of Section 20(4) of the Terrorist and
Disruptive Activities (Prevention) Act, 1987 introduced by an
Amendment Act governing Section !67(2) CrPC in relation to
TADA matters was in the realm of procedural law and if so,
G whether the same would be applicable to pending cases ...... The
Court summed up the legal position with regard to the procedural
law being retrospective in its operation and the right of a litigant to
claim that he be tried by a particular Court, in the following words:
(SCC p. 633, para 26)
"(i) A statute which affects substantive rights is presumed to
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 581
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
be prospective in operation unless made retrospective, either A
expressly or by necessary intendment, whereas a statute which
merely affects procedure, unless such a construction is textually
impossible, is presumed to be retrospective in its application,
should not be given an extended meaning and should be strictly
confined to its clearly defined limits.
B
(ii) Law relating to forum and limitation is procedural in nature,
whereas law relating to right of action and right of appeal even
though remedial is substantive in nature.
(iii) Every litigant has a vested right in substantive law but no
such right exists in procedural law. c
(iv) A procedural statute should not generally speaking be
applied retrospectively where the result would be to create
new disabilities or obligations or to impose new duties in respect
of transactions already accomplished.
(v) A statute which not only changes the procedure but also D
creates new rights and liabilities shall be construed to be
prospective in operation, unless otherwise provided. either
expressly or by necessary implication."
12. We may also refer to the decision of this Court in Sudhir G
Angur v. M. Sanjeev (2006) I SCC 141 where a three-Judge E
Bench of this Court approved the decision of the Bombay High
Court in Shiv Bhagwan Mo ti Ram Saraoj iv. Onkarmal Ishar Dass
(1952) 54 Born. LR 330 and observed: (SCC p. 148, para II)
"11 .... It has been held that a court is bound to take notice of
the change in the law and is bound to administer the law as it F
was when the suit came up for hearing. It has been held that if
a court has jurisdiction to try the suit, when it comes on for
disposal, it then cannot refuse to assume jurisdiction by reason
of the fact that it had no jurisdiction to entertain it at the date
when it was instituted. We are in complete agreement with
G
these observations."
xxx xxx
xxx
19 ...... In Nani Gopal Mitra v. State ofBihar AIR 1970 SC 1636,
H
•.
582 SUPREME COURT REPORTS [2017] 13 S.CR.
A this Court declared that amendments relating to procedure
operated retrospectively subject to the exception that whatever
be the procedure which was correctly adopted and proceedings
concluded under the old law the same cannot be reopened for the
purpose of applying the new procedure ...... This Court held that
the conviction pronounced by the Special Judge could not be termed
B
illegal just because there was an amendment to the procedural
law ol) 18-12-1964. The following passage is, in this regard,
apposite: (AIR p. 1639, paras 5-6)
"5 .... It is therefore clear that as a general rule the amended
law relating to procedure operates retrospectively But there
c is another equally important principle viz. that' a statute should
not be so construed as to.create new disabilities orobligations
or impose new duties in respect of transactions which were
complete at the tim¥ the amending Act came into force (see A
Debtor, In re, exp Debtor (1936) 1Ch237 (CA) and Attorney
D General v. Vernazza 1960 AC 965). The same principle is
embodied in Section 6 of the General Clauses Act which is to
the following effect:
• • •
6. The effect of the application of this principle is that pending
E casfs, although instituted under the old Act but still pending,
are governed by the new procedure under the amended law.
but whatever procedure was correctly adopted and concluded
under the old law cannot be opened again for the pumose of
applying the new procedure...... It is not hence possible to
F accept the argument of the appellant that the conviction
pronounced by the Special Judge, Santhal Parganas, has
become illegal or in any way defective in law because of the
amendment to procedural law made on 18-12-1964. In our
opinion, the High Court was right in invoking the presumption
under Section 5(3) of the Act even though it was repealed on
G 18-12-1964 by the amending Act. We accordingly reject the
argument of the appellant on this aspect of the case."
(iii) Reliance was then placed on Kamlesh Kumar v. State of
Jharkhand, (2013) 15 SCC 460. In this judgment, the main opinion was
rendered by H.L. Gokhale, J., and a concurring order was passed by
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 583
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
Madan B. Lokur, J. Reliance was placed on the following observations A
from the judgment rendered by H.L. Gokhale, J.:
"19. The First Schedule to CrPC deals with the classification of
offences. Part I thereof deals with the offences under the Penal
Code, 1860, Part II deals with classification of offences against
other laws, which would include offences under laws such as B
FERA. The petitioners were being prosecuted under Section 56
ofFERA, wherein the maximum punishment that could be awarded
was up to seven years. The second entry of this Part II laid down
that such offences were triable by a Magistrate of the First Class,
provided those offences were cognizable offences. As noted earlier,
Section 62 of FERA made the offence under Section 56 non- c
cognizable. Besides, Section 61(1) of FERA stated that "it shall
be lawful" for the Magistrate to pass the necessary sentence
under Section 56. It does not state that the Magistrate alone is
empowered to pass the necessary sentence, in which case the
proceeding cannot be transferred from his Court. This provision D
is not like the one in A.R. Antulay v. R.S. Nayak (1988) 2 SCC
602 where under Section 7(1) of the Criminal Law Amendment
Act, 1952 the offence was "triable by Special Judge only". In the
instant case it was merely lawful for the Magistrate to try the
offences under Section 61, but the Court of the Magistrate was
not a court of exclusive jurisdiction as in Antulay case. The offence E
was a non-cognizable one, and therefore it was not mandatory
that it ought to have been tried only by the Magistrate of the First
Class. Thus the petitioner could not claim that the Magistrate had
the special jurisdiction to try the offence, and that the State could
not transfer the case to the Sessions Judge. In view of what is F
stated above. it cannot be said that the Magistrate's Court had an
exclusive jurisdiction to try the cases relating to violations of the
provisions of FERA. and those cases could not be transferred to
the Special Judge. In the present case the accused were common,
many of the witnesses would be common, and so also their
evidence. The administrative power of the High Court in such a G
situation to effect transfer has been upheld in Ranbir Yadav v.
State ofBihar (1995) 4 SCC 392. and there is no reason for this
Court to take a different view in the facts of the present case.
'
20. The petitioner had relied upon the judgment of a Division Bench
H
584 SUPREME COURT REPORTS [2017] 13 S.C.R.
A of the Delhi High Court in A.S. Impex Ltd. v. Delhi High Court
(2003) 107 DLT 734, on the question of transfer of a proceeding.
Mr Malhotra pointed out that although the judgment in Raubir
Yadav was brought to the notice of the Division Bench in that
matter, the Division Bench had erroneously held that the reliance
thereon to be a "misplaced" one, as can be seen front the sentence
B
at the end of para 12 of that judgment. This judgment has been
distinguished and found to be not laying down a good law by another
Division Bench of the Delhi High Court in Mahender Singh v.
High Court of Delhi (2009) l 51 Comp Cas 485 (Del). In that
matter, the Court was concerned with transfer of prosecutions
c under the Securities and Exchange Board of India Act, 1992 from
the Magistrate's Court to the Court of Session, and the High Court
has held it to be valid and permissible. The Division Bench in
Mahender Singh has in terms held that reliance on the judgment
in A.R. Antulay to oppose such transfer was of no help, and rightly
so. There is no difficulty in stating that A.S. lmpex Ltd. does not
D
lay down the correct proposition of Jaw.
21. The High Court does have the power to transfer the cases
and appeals under Section 407 CrPC which is essentially a judicial
power. Section 407(l)(c) CrPC lays down that, where it will tend
to the general convenience of the parties or witnesses, or where
E it was expedient for the ends of justice, the High Court could
transfer such a case for trial to a Court of Session. That does not
mean that the High Court cannot transfer cases by exercising its
administrative power of superintendence which is available to it
under Article 227 of the Constitution of India. While repelling the
f objection to the exercise of this power. this Court observed in
para 13 of Ranbir Yadav as follows: (SCC p. 400)
"13. We are unable to share the above view of Mr Jethmalani.
So long as power can be and is exercised purely for
administrative exigency without impinging upon and prejudicially
G affecting the rights or interests of the parties to any judicial
proceeding we do not find any reason to hold that administrative
powers must yield place to judicial powers simply because in a
given circumstance they coexist."
22. For the reasons stated above, there is no substance in the
objections raised by the petitioners. The High Court has looked
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 585
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
into Section 407 CrPC, referred to Articles 227 and 235 of the A
Constitution of India, and thereafter in its impugned judgment has
observed as follows:
"Having perused Section 407 CrPC and Articles 227 and 235,
I have no hesitation to hold that this Court either on the
administrative side or in the judicial side has absolute jurisdiction B
to transfer any criminal cases pending before one competent
court to be heard and decided by another court within the
jurisdiction of this Court. This Court in its administrative power
can issue direction that cases of particular nature shall be heard
by particular court having jurisdiction."
c
In view of what is stated earlier, we have no reason to take a
view different from the one taken by the High Court. Both the
special leave petitions (criminal) are, therefore, dismissed."
From the observations recorded by Madan B. Lokur, J. reliance
was placed on the following: D
"30. It was contended that assuming that at law the case could
validly have been transferred to the Special Judge, the petitioners
are seriously prejudiced inasmuch as their right of appeal from
the decision of a Magistrate to a Sessions Judge is taken away.
Due to this prejudicial action, which was taken by the High Court E
without hearing the petitioners, the notification conferring power
on the Special Judge to try the case should be struck down.
xxx xxx xxx
33. Similarly, in Maria Cristina De Souza Sodder v. Arnria Zurana
Pereira Pinto (1979) I SCC 92 it was held somewhat more F
elaborately: (SCC p. 97, para 5)
"5 .... It is no doubt well settled that the right of appeal is a
substantive right and it gets vested in a litigant no sooner the !is
is commenced in the Court of the first instance, and such right
or any remedy in respect thereof will not be affected by any G
repeal of the enactment conferring such right unless the
repealing enactment either expressly or by necessary
implication takes away such right or remedy in respect thereof.
.. . This position, has also been settled by the decisions of the
Privy Council and this Court (vide Colonial Sugar Refining Co.
H
586 SUPREME COURT REPORTS (2017] 13 S.C.R.
A Ltd. v. Irving 1905 AC 369 and Garikapati Veeraya v. N.
Subbiah Choudhry AIR 1957 SC 540) but the forum where
such appeal can be lodged is indubitably a procedural matter
and, therefore, the appeal. the right to which has arisen under
a repealed Act. will have to be lodged in a forum provided for
by the repealing Act."
B
34. Int. Barai v. Henry Ah Hoe !1983) 1 SCC 177, it was
observed in para 17 of the Report that a person accused of the
commis~ion of an offence has no right to trial by a particular
procedllj"e. This view was followed in Rai Bahadur Seth Shreeram
Durgaprasad v. Director of Enforcement !1987) 3 SCC 27.
c
35. Therefore, it cannot be seriously urged that the petitioners
were prejudiced by a change of the appellate forum.
xxx xxx xxx
43. While the revisional power of a superior court actually enables
D it to correct a grave error. the existence of that power does not
confer any corresponding right on a litigant. This is the reason
why. in a given case, a superior court may decline to exercise its
power of revision, if the facts and circumstances of the case do
not waqant the exercise of its discretion. This is also the reason
E why it is felicitously stated that a revision is not a right but only a
"procedUral facility" available to a party. If the matter is looked at
in this light, the transfer of a case from a Magistrate to a Special
Judge does not take away this procedural facility available to the
petitioners. It only changes the forum and as already held above,
the petitioners have no right to choose the forum in which to file
F an appeal or move a petition for revising an interlocutory order.
xxx xxx xxx
45. In A.S. Impex case (2003) 107 DLT 734, the High Court
administratively decided to transfer cases filed under Section 13 8
of the Negotiable Instruments Act, 1881 on or before 31-12-2001
G
and pending before the Magistrates to the Additional Sessions
Judges. A notification for transfer ofcases was accordingly issued
and this was struck down by the Delhi High Court by, inter alia,
relying on the law laid down in Antulay. As already noted above,
the law laid down in Antulay has limited application and is not
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 587
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
relevant to cases such as the one we are dealing with. This was A·
clearly explained in Ranbir Yadav but the Delhi High Court ignored
the observations of this Court without much ado by holding: (A.S.
Impex case, DLT p. 744, para I2)
"12 . ... In that case the Court transferred the case from the
Court of one Magistrate to the Court of another Magistrate B
for the reason that there was shortage of accommodation in
the first court: That is not the case in hand. It was not a case
where the jurisdiction was transferred from the Court of
Magistrate to the Court of Session."
The Delhi High Court also proceeded on an erroneous basis that c
the exercise of plenary administrative power available to the High
Court to transfer cases meant the bypassing or circumventing of
statutory provisions empowering the Magistrates to trv cases under
Section 138 of the Negotiable Instruments Act, 1881 and conferring
that jurisdiction on Additional Sessions Judges. The High Court
did not correctly appreciate the power available to a High Court D
under Article 227 of the Constitution."
(iv) On the instant aspect of the matter, last of all, reliance was
placed on Rajendra Kumar v. Kalyan, (2000) 8 SCC 99. The Court's
attention was invited to the following conclusions:
E
"20. We do feel it expedient to record that the analysis as effected
by the High Court stands acceptable and as such we refrain
ourselves from dilating on this aspect of the matter any further.!!
is pertinent to add in this context that some differentiation exists
between a procedural statute and statute dealing with substantive
rights and in the normal course of events, matters of procedure F
are presumed to be retrospective unless there is an express ban
onto its retrospectivitv. In this context, the observations of this
Court in the case of Jose Da Costa v. Bascora Sadasiva Sinai
Narcomim (1976) 2 SCC 917 is of some relevance. This Court in
para 31 of the Report observed: (SCC p. 925)
G
"31. Before ascertaining the effect of the enactments aforesaid
passed by the Central Legislature on pending suits or appeals,
it would be appropriate to bear in mind two well-established
principles. The first is that while provisions of a statute dealing
merely with matters of procedure may properly, unless that H
588 SUPREME COURT REPORTS [2017] 13 S.C.R.
A construction be textually inadmissible, have retrospective effect
attributed to them, provisions which touch a right in existence
at the passing of the statute are not to be applied retrospectively
in the absence of express enactment or necessary intendment
(see Delhi Cloth and General Mills Co. Ltd. v. CIT, AIR 1927
PC 242).
B
The second is that a right of appeal being a substantive right
the institution of a suit carries with it the implication that all
successive appeals available under the law then in force would
be preserved to the parties to the suit throughout the rest of
the career of the suit. There are two exceptions to the application
c of this rule, viz. ( [) when by competent enactment such right
of appeal is taken away expressly or impliedly with retrospective
effect and (2) when the court to which appeal lay at the
commencement of the suit stands abolished (see Garikapati
Veeraya v. N. Subbiah Choudhry AIR 1957 SC 540 and Colonial
D Sugar Refining Co. Ltd. v. Irving 1905 AC 369)."
21. Still later this Court in Gurbachan Singh v. Satpal Singh ( 1990)
1 SCC 445 expressed in the similar vein as regards the element of
retrospectivity. The English courts also laid that the rule that an
Act of Parliament is not to be given retrospective effect applies
E only to statutes which affect the vested rights; it does not apply to
statutes which alter the form oforocedure or the admissibility of
evidence, or the effect which the courts give to evidence; if the
new Act affects matters of procedure only. then, prima facie, it
applies to all actions pending as well as future (see in this context
the decisions of the House of Lords in the case of Blyth v. Blyth
F ( 1966) l All ER 524; A.G v. Vernazza ( 1960) 3 All ER 97). In
Halsbury's Laws of England (4th Edn., Vol. 44, para 925, p. 574)
upon reference to Wright v. Hale ( 1860) 6 H&N 227 and Gardner
v. Lucas ( 1878) 3 AC 582 (HL) along with some later cases
including Blyth v. Blyth it has been stated:
G "The presumption against retrospection does not apply to
legislation concerned merely with matters of procedure or of
evidence; on the contrary, provisions of that nature are to be
construed as retrospective unless there is a clear indication
that such was not the intention of Parliament."
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 589
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
22. The law thus seems to be well settled that no person has, in A
fact, a vested right in procedural aspect - one has only a right of
prosecution or defence in the manner as prescribed by the law for the
time being and in the event of any change of procedure by an Act of
Parliament one cannot possibly have any right to proceed with the pending
proceeding excepting as altered by the new legislation and as such we
B
need not dilate on the issue any further."
Based on the conclusions recorded by this Court in the above
cited judgments, it was contended, that with reference to procedure,
there could be no dispute, that cognizance to be taken by a court
competent at the time a matter is taken up, can be changed retrospectively,
even ifthe cause of action had accrued prior to the change (of'forum' c
for trial). And further, that an accused has no vested right, to be tried by
a particular procedure, or by a particular court (forum), except insofar
as there is a mandate (express or implied) in the amending statute, or a
constitutional bar or objection, or the violation ofany fundamental right.
Therefore, when the amendments herein vested exclusive jurisdiction in D
a particular court (-the Court of Session, consequent upon 'the 2002
Amendment Act', and the Special Court, consequent upon 'the 2014
Amendll).entAct'), adjudication could thereupon have only been rendered
by the court with which special jurisdiction was vested (by the respective
amendments). In such a situation, notwithstanding anything contained
in the Code of Criminal Procedure, the special enactment would also E
have an overriding effect. It was therefore contended, that in the absence
of any prejudice shown to the private parties before this Court, it was
not open to them, to assail the express determination rendered for change
of 'forum', in the first instance, by 'the 2002 Amendment Act', and
thereafter, by 'the 2014 Amendment Act'. F
14. It was also the contention of the learned Additional Solicitor
General representing SEBI, that the legislature enacting the original
legislation, surely had the power and the authority to amend the same,
which would include the power to alter the 'forum' of trial, originally
postulated. Herein again, it was contended, that the aforementioned G
proposition, is subject to a general limitation, namely, that the change of
'forum' for trial should not prejudicially affect the rights of the party(ies)
facing prosecution. Insofar as the instant aspect of the matter is
concerned, learned Additional Solicitor General placed reliance on the
declared legal position, by citing the followingjudgments:
H
590 SUPREME COURT REPORTS [2017) 13 S.C.R.
A (i) Reliance was first of all placed on Kamlesh Kumar v. State of
Jharkhand, (2013) 15 sec 460. Our attention was invited to the following
observations recorded therein:
"27 .3. The third reason related to the power of transfer available
to this Court under Article 142 of the Constitution. In this context,
B reference was made to a Constitution Bench decision of this Court
in Prem Chand Garg v. Excise Commr. AIR 1963 SC 996 wherein
it was observed that: (AIR p. 1002, para 12)
"12 .... The powers of this Court are no doubt very wide and
they are intended to be and will always be exercised in the
c interest of justice. But that is not to say that an order can be
made by this Court which is inconsistent with the fundamental
rights guaranteed by Part Ill of the Constitution. An order which
this Court can make in order to do complete justice between
the parties, must not only be consistent with the fundamental
rights guaranteed by the Constitution, but it cannot even be
D inconsistent with the substantive provisions of the relevant
statutory laws."
Since the order of this Court transferring the case from the Special
Judge to the High Court was contrary to the statutory law and (as
held in a later part in Antulay) contrary to Article l 4 and Article
E 19 of the Constitution, the order of transfer was liable to be set
aside. In this context, this Court also noted that the power to create
or enlarge jurisdiction is legislative in character and no court,
whether superior or inferior or both combined, could enlarge the
jurisdiction of a court. On this basis, inter alia, this Court concluded
F that the transfer of Antulay case from the Special Judge to the
High Court was erroneous in law.
28. Antulay subsequently came up for consideration in Ranbir
Yadav v. State of Bihar (1995) 4 SCC 392. In para 14 of the
Report, it was noted that the express language of Section 7( l) of
G the CLA Act, took away the right of transfer of cases contained
in the Code to any other court which was not a Special Court and
that this was notwithstanding anything contained in Section 406
and Section 407 of the Code. This is what was said in this regard:
(SCC p. 400)
"14. Coming now to A.R. Antulay case we find that the
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 591
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
principles of law laid down in the majority judgment, to which A
Mr J ethmalani drew our attention have no manner of
application herein. There questions arose as to whether (i) the
High Court could transfer a case triable according to the
Criminal Law Amendment Act. 1952 ('the 1952 Act', for short)
by a Special Court constituted thereunder to another court,
B
which was not a Special Court and (ii) the earlier order of the
Supreme Court transferring the case pending before the Special
Court to the High Court was valid and proper. In answering
both the questions in the negative the learned Judges, expressing
the majority view, observed that (i) Section 7(1) of the 1952
Act created a condition which was sine qua non for the trial of C
offences under Section 6(1) of the said Act. The condition
was that notwithstanding anything contained in the Code of
Criminal Procedure or any other law the said offence shall be
triable by Special Judges only. By express terms therefore it
took away the right of transfer of cases contained in the Code
D
to any other court which was not a Special Court and this was
notwithstanding anything contained in Sections 406 and 407 of
the Code and (ii) the earlier order of the Supreme Court
transferring the case to the High Court was not authorised by
law, namely, Section 7(1) of the 1952 Act and the Supreme
Court, by its direction. could not confer jurisdiction on the High E
Court of Bombay to trv any case for which it did not possess
such jurisdiction under the scheme of the 1952 Act."
(ii) Reliance was then placed on Nani Gopal Mitra v. State of
Bihar, AIR 1970 SC 1636, and the observations recorded in paragraph 6,
were brought to our notice: F
"6. The effect of the application of this principle is that pending
cases although instituted under the old Act but still pending are
governed by the new procedure under the amended law, but
whatever procedure was correctly adopted and concluded under
the old law cannot be opened again for the purpose of applying · G
the new procedure. In the present case, the trial of the appellant
was taken up by the Special Judge, Santhal Parganas when Section
5(3) of the Act was still operative. The conviction of the appellant
was pronounced on March 31, 1962 by the Special Judge, Santhal
Parganas long before the amending Act was promulgated. It is
H
592 SUPREME COURT REPORTS [2017] 13 S.C.R.
A not hence possible to accept the argument of the appellant that
the conviction pronounced by the Special Judge, Santhal Parganas
has become illegal or in any way defective in law because of the
amendment to procedural law made on December 18, 1964. In
our opinion, the High Court was right in invoking the presumption
under S. 5(3) of the Act even though it was repealed on December
B
18, 1964 by the amending Act. We accordingly reject the argument
of the appellant on this aspect of the case."
(iii) Reliance was also placed on Securities and Exchange Board
of India v. Ajay Agarwal, (2010) 3 SCC 765, wherefrom learned counsel
pointedly drew our attention to the legal position expressed in paragraphs
c 40 and 41, which are reproduced below:
"40. Provisions of Section 11-B being procedural in nature can be
appli9d retrospectively. The Appellate Tribunal made a manifest
error by not appreciating that Section 11-B is procedural in nature.
It is a time-honoured principle if the law affects matters of
D procedure, then prima facie it applies to all actions. pending as
well as future. [See K. Kapen Chako v. Provident Investment
Co. (P) Ltd. (1977) 1SCC593, whereinA.N. Ray, C.J. laid down
those principles].
4 l. J\1iaxwell in his Interpretation of Statutes also indicated that no
E one has a vested right in any course of procedure. A person's
right of either prosecution or defence is conditioned by the manner
prescribed for the time being by the law and if by the Act of
Parliament, the mode of proceeding is altered, then no one has
any other right than to proceed under the alternate mode. (Maxwell
F on Interpretation of Statutes, 11th Edn., p. 216.) These principles,
enunciated by Maxwell, have been quoted with approval by the
Supreme Court in its Constitution Bench judgment in Union of
India v. Sukumar Pyne, AIR 1966 SC 1206."
(iv) Last ofall, reliance was placed onA.R. Antulay v. R.S. Nayak,
G ( 1988) 2 SCC 602, wherefrom, our attention was pointedly drawn to the
following:
"24. Section 7( ll of the 1952 Act creates a condition which is
sine qua non for the trial of offences under Section 6( 1) of the
said Act. The condition is that notwithstanding anything contained
in the Code of Criminal Procedure or any other law. the said
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 593
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
offences shall be triable by Special Judges only. Indeed conferment A
of the exclusive jurisdiction of the Special Judge is recognised by
the judgment delivered by this Court in A.R. Antulay v. Ramdas
Sriniwas Nayak ( 1984) 2 SCR 914 where this Court had adverted
to Section 7(1) of the 1952 Act and at p. 931 (SCC p. 514)observed
that Section 7 of the 1952 Act conferred exclusive jurisdiction on
B
the Special Judge appointed under Section 6 to try cases set out in
Sections 6(1)(a) and 6(1)(b) of the said Act. The court emphasised
that the Special Judge had exclusive jurisdiction to try offences
enumerated in Section 6(l)(a) and (b). In spite of this while giving
directions in the other matter, that is, R.S. Nayak v. A.R. Antulay
(1984) 2 SCR 495, this Court directed transfer to the High Court c
of Bombay the cases pending before the Special Judge. It is true
that Section 7(1) and Section 6 of the 1952 Act were referred to
while dealing with the other matters but while dealing with the
matter of directions and giving the impugned directions, it does
not appear that the court kept in mind the exclusiveness of the D
jurisdiction of the Special Court to try the offences enumerated in
Section 6."
Based on the legal position declared by this Court, it was asserted,
that the 'forum' for trial, expressed prior to the concerned amendment
herein, did not create a vested right in the accused. And that, even in
matters where proceedings had already commenced before the E
amendment, the amendment would have to be given effect to.
Furthermore, the concerned accused were liable to be proceeded against,
before the changed 'forum' (introduced by the amendment). It was
pointed out, that while interpreting the provisions of 'the SEBI Act' itself,
this Court had held Section 1 lB to be a procedural provision, having F
retrospective effect, and that, the amended provision would be applicable
to pending cases, even in matters which had arisen prior to the
amendment. It was submitted that, where a legislative enactment provides
for a special/specific 'forum' for adjudication, then only such special/
specific 'forum' can try matters arising under the enactment. It was
submitted, that in such matters, the jurisdiction of all other courts stood G
excluded.
15. In order to support the contentions advanced on behalf of the
SEBI, as have been recorded in the preceding two paragraphs, it was
also the contention of the learned Additional Solicitor General, that
H
594 SUPREME COURT REPORTS [2017] 13 S.C.R.
A procedure and 'forum' for trial postulated by a special law- 'the SEBI
Act', would always have an overriding effect over the general law - the
Code of Criminal Procedure. In this behalf, it was contended, that Section
26 of 'the SEBI Act' (consequent upon 'the 2002 Amendment Act')
expressly provided, that "no court inferior to that of a court of session
shall try any offence punishable under this Act". It was therefore asserted,
B
that there was no room for any doubt, that the aforesaid amendment
was made retrospectively, with effect from29. l 0.2002. It was submitted,
that there was no ambiguity in the aforesaid provisions and it was not
possible even on a close examination of the text of the above amendment,
to construe otherwise. And that, after 29.10.2002 (i.e., the operative
c date of 'the 2002 Amendment Act') criminal adjudication arising under
the provisions of 'the SEBI Act' could not be entertained by any court,
inferior to the <;;ourt of Session. It was submitted, that the Court of
Metropolitan Magistrate/Judicial Magistrate, therefore came to be
divested of the authority to adjudicate upon matters arising under 'the
SEBI Act', after the above amendment. On the same analogy, it was
D
contended, that consequent upon 'the 2014 Amendment Act', whereby,
Section 26(2) of 'the SEBI Act' was omitted, and Section 26B of 'the
SEBI Act' was inserted (into 'the SEBI Act'), jurisdiction was vested
with Special Courts, to deal with all offences under 'the SEBI Act',
" ... committed prior to the date of commencement of the Securities Laws
E (Amendment) P,ct, 2014, oron or after the date of such commencement,
shall be taken cognizance of and tried by the Special Court ... ". Based
on the above amendment, which came into force with effect from
18.07.2013, it was asserted, that all courts other than Special Courts
created under 'the SEBI Act', were divested of the power to adjudicate
matters arising thereunder, including pending matters, which had arisen
F
prior to the amendment. It was submitted, that the intent of the legislature
was clear and emphatic, namely, offences committed before or after the
coming into operation of 'the 2014 Amendment Act' would be triable
only by a Special Court, and by no other court. It was therefore asserted,
that with effect from 18.07.2013, all pending matters would have to be
G transferred for adjudication to the Special Courts. Based on the aforesaid
assertions, it was the contention of the leamedAdditional Solicitor General,
that the Bombay High Court had erred in recording its finding, that cases
instituted before a Metropolitan Magistrate (or, a Judicial Magistrate of
the first class) would continue to be adjudicated by the said courts, and
that, 'the 2002 Amendment Act' would have no effect on such matters.
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 595
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
In the above view of the matter, it was the submission of the learned A
Additional Solicitor General, that the determination rendered by the
Bombay High Court, with reference to 'forum' had been rendered
infructuous, consequent upon 'the 2014 Amendment Act' which inter
alia omitted Section 26(2) from 'the SEBI Act', and retrospectively
inserted Section 26B into 'the SEBI Act'. Before that, according to B
learned senior counsel, Section 26(2) of 'the SEBI Act' amended by
'the 2002 Amendment Act' held the field (with effect from 29 .10.2002),
and that, adjudication after 29 .10.2002 could only be made (for offences
arising under 'the SEBI Act'), by a Court of Session.
16. Mr. C.A. Sundaram, Senior Advocate, represented most of
the private parties (some appellants, and some respondents). He C
acknowledged the proposition canvassed on behalf of the SEBI, on the
basis ofthe judgments cited during the course of hearing. It was however
his contention, that the proposition canvassed on behalf of the SEBI was
the general view, on the subject of change in procedural law, which
included change of 'forum'. It was his pointed assertion, that there was D
a basic difference between change in substantive law, change in procedural
law, and change in procedure constituting a change in 'forum'. He
emphasized, that there was an important and subtle difference in the
latter two. It was submitted, that change in 'forum' need not always be
procedural. Learned counsel acknowledged, that change in substantive
law was generally prospective (more so, in a case of criminal E
jurisprudence). In this behalf, he placed reliance on Articles 20 and 21
of the Constitution oflndia. It was also acknowledged, that even though
change in procedural law was generally retrospective, it would not be
so, where the legislature expressly or by necessary implication, required
it to be prospective. F
17. Learned Senior Advocate also pointed out, that all matters
pertaining to change in 'forum' should not be clubbed and treated similarly,
under the parameters expressed above. It was submitted, that cases
pertaining to change of 'forum', ought to be placed in two different
categories. Firstly, where the proceedings had already been instituted G
and were pending, at the time of amendment. And secondly, where
proceedings were yet to be instituted, on the date when the amendment
became operational. It was submitted, that where proceedings had already
been initiated and trial was in progress, change of 'forum' by way of
legislation, by implication would be prospective. In terms of the instant
H
596 SUPREME COURT REPORTS [2017] 13 S.C.R.
A classification, it was submitted, that the present controversy falls in the
first category. Change of 'forum', according to learned counsel, would
not be retrospective, for the first category, only where expressly mandated
otherwise. Besides the legality of the issues, learned counsel posed a
simple question; how can an amendment in legislation, shift a pending
case, midstream, to another court?
B
18. Learned senior counsel however conceded, that where the
legislative amendment, while providing for a change of'forum' for trial,
also provides for transfer of pending case (postulated, under the
unamended e11actment), the amendment of 'forum' for trial would be
retrospective. lt was submitted, that in the absence of express or implied
c intent, all matters falling in the first category would continue to remain
with the original 'forum' (provided for, under the unamended provision).
And therefore, such an amendment of 'forum', even though admittedly
procedural in nature, would be prospective (and not, retrospective). It
was submitted, that such express or implied intendment (pertaining to
D the first category), would become apparent from an amended statute,
where the original court is not deprived of exercising jurisdiction, or
alternatively, when the original court's existingjurisdiction is abolished.
In all such cas~s, according to learned counsel, unless the continuation
of pending matters by the 'forum' already seized of the matter is done
away with, expressly or by necessary implication, all pending proceedings
E would continue to be dealt with by the 'forum' where the matter was
originally instituted. While expounding the aforesaid position, learned
senior counsel, representing the private parties acknowledged, that the
proposition canvassed on behalf of the SEBI, with reference to 'forum'
would be applicable, to the second category, namely, to cases wherein
F proceedings were yet to be instituted. It was acknowledged by learned
counsel, that in matters where the proceedings were yet to be instituted,
the legally justified assumption would be, that they would have to be
instituted in the newly created 'forum', despite the fact, that the cause
had occurred when the 'forum' postulated was the one envisaged under
the unamended enactment.
G
19. Insofar as the present controversy is concerned, it was sought
to be asserted by learned senior counsel, that the amendment of' forum'
for trial, through 'the 2002 Amendment Act' could not be described as
purely procedural, as the same was demonstrably substantive. Firstly,
because the change in 'forum' was merely consequential to substantive
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 597
CREDIT LTD. [JAGDISH SINGH KHEHAR, CH]
changes in the Act (namely, change in Sections! IC and 24 of'the SEBI A
Act'). In this behalf it was submitted, that the change of 'forum', was
not a stand alone action. It was pointed out, that the change of'forum'
was dependent and accessory to, the amendment to the quantum of
punishment contemplated for failing or refusing to cooperate with the
investigating authorities, for violating the provisions of the SEB!Act. It
B
was asserted, that the enhanced quantum of punishment, was the reason
for the change in 'forum' (from a lower, to a superior court). Secondly,
it was submitted, that as change in 'forum' was only consequential, and
as such, by virtue of Sections 208 and 209 of the Code of Criminal
Procedure, the new 'forum' - the Special Court, could not deal with
pending matters (as is the situation, in all the cases herein) since the pre- c
requisites therefor are not completed by the amendment, inasmuch as,
Sections 11 C and 24 of the SEBI Act, would not apply to occurrences/
causes, prior to the date of amendment. It was submitted, that to
understand the amendments introduced through 'the 2002 Amendment
Act', especially Sections 11 C, 24 and 26, the other provisions amended
D
simultaneously, had to be read together. It was also submitted, that the
insertion of Section 26B through 'the 2014 Amendment Act', would only
apply to offences committed after the amendment, or to those offences,
though committed prior to the amendment; but cognizance whereof had
not been taken, at the time of the amendment. It was further submitted,
that a plain reading of Section 26B would reveal, that the intent expressed E
therein, was conjunctive, inasmuch as the language adopted in Section
26B, could not be read as disjunctive.
20. In order to substantiate the contentions canvassed by learned
senior counsel representing the private parties, as have been delineated
in the foregoing paragraphs, emphatic reliance was placed on Ramesh F
Kumar Soni v. State of Madhya Pradesh, (2013) 14 SCC 696. It was
pointed out from the above judgment, that the factual foundation of the
controversy was depicted in paragraphs 2 to 8, which are reproduced
below:
"2. The factual matrix in which the controversy arises may be G
summarised as under: Crime No. 129 of 2007 for commission of
offences punishable under Sections 408, 420, 467, 468 and 471
!PC was registered against the appellant on 18-5-2007, at
Bheraghat Police Station. On the date of the registration of the
case the offences in question were triable by a Magistrate of
H
598 SUPREME COURT REPORTS (2017] 13 S.C.R.
A First Class in terms of the First Schedule of Code of Criminal
Procedure, 1973. That position underwent a change on account
of the Code of Criminal Procedure (Madhya Pradesh Amendment)
Act of 2007 introduced by Madhya Pradesh Act 2 of 2008 which
amended the First Schedule of the 1973 Code and among others
made offences under Sections 467. 468 and 471 IPC_triable by
B
the Court of Session instead of a Magistrate of First Class. The
amendment received the assent of the President on 14-2-2008
and was l)ublished in Madhya Pradesh Gazette (Extraordinary)
on 22-2-2008.
3. Conseqµent upon the amendment aforementioned, the Judicial
c Magistrate, First Class appears to have committed to the Sessions
Court all cases involving commission of offences under the above
provisions. In one such case the Sessions Judge, Jabalpur, made a
reference to the High Court on the following two distinct questions
oflaw:
D 3. l. (i) Whether the recent amendment dated 22-2-2008 in
Schedule I of the Criminal Procedure Code is to be applied
retrospectively?
3.2. (ii) Consequently, whether the cases pending before the
Magistrate, First Class, in which evidence partly or wholly has
E been recorded, and now have been committed to this Court are to
be tried de novo by the Court of Session or should be remanded
back to the Magistrate, First Class for further trial?
4. A Full Bench of the High Court of Madhya Pradesh in
Amendment of First Schedule of Criminal Procedure Code by
F Criminal Procedure Code (M.P. Amendment) Act, 2007, In re
(2008) 3 MPLJ 31 l, answered the reference and held that all
cases pending before the Court of the Judicial Magistrate, First
Class as on 22-2-2008 remained unaffected by the Amendment
and were triable by the Judicial Magistrate, First Class as the
G Amendment Act did not contain a clear indication that such cases
also have to be made over to the Court of Session. The Court
further held that all such cases as were pending before the Judicial
Magistrate, First Class and had been committed to the Sessions
Court shall be sent back to the Judicial Magistrate. First Class in
accordance with law. The reference was answered accordingly.
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 599
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
5. Relying upon the decision of the Full Bench the appellant filed A
an application before the trial court seeking a similar direction for
remission of the case for trial by a Judicial Magistrate. The
appellant argued on the authority of the above decision that although
the police had not filed a charge-sheet against the appellant and
the investigation in the case was pending as on the date the B
amendment came into force, the appellant had acquired the right
of trial by a forum specified in Schedule I of the 1973 Code. Any
amendment to the said provision shifting the forum of trial to the
Court of Session was not attracted to the appellant's case thereby
rendering the committal of the case to the Sessions Court and the
proposed trial of the appellant before the Sessions Court illegal. C
The trial court, as mentioned earlier, repelled that contention and
held that since no charge-sheet had been filed before the Magistrate
as on the date the amendment came into force, the case was
exclusively triable by the Sessions Court. The High Court has
affirmed that view and dismissed the revision petition filed by the
D
appellant, hence the present appeal.
6. The Code of Criminal Procedure (Madhya Pradesh
Amendment) Act, 2007 is in the following words:
"An Act further to amend the Code of Criminal Procedure,
1973 in its application to the State of Madhya Pradesh. E
Be it enacted by the Madhya Pradesh Legislature in the Fifty-
eighth Year of the Republic of India as follows:
1. Short title.-{ 1) This Act may be called the Code of Criminal
Procedure (Madhya Pradesh Amendment) Act, 2007.
F
2. Amendment of Central Act No. 2of1974 in its application
to the State of Madhya Pradesh.-The Code of Criminal
Procedure, 1973 (2 of 1974) (hereinafter referred to as 'the
Principal Act'), shall in its application to the State of Madhya
Pradesh, be amended in the manner hereinafter provided.
G
3. Amendment of Section 167.- * * •
4. Amendment of the First Schedule.-In the First Schedule
to the Principal Act, under the heading 'I-Offences under the
Indian Penal Code' in Column 6 against Sections 317, 318,
326,363,363-A,365,377,392,393,394,409,435,466,467,
H
600 SUPREME COURT REPORTS (2017] 13 S.C.R.
A 468, 471, 472, 473, 474, 475, 476, 477 and 477-A, for the words
'Magistrate of the First Class' wherever they occur, the words
'Court of Session' shall be substituted."
7. The First Schedule to the Criminal Procedure Code, 1973
classifies offences under IPC for purposes of determining whether
B or not a particular offence is cognizable or non-cognizable and
bailable or non-bailable. Column 6 of the First Schedule indicates
the court by which the offence in question is triable:
7. I. The Madhya Pradesh Amendment extracted above has shifted
the forum Qf trial from the Court of a Magistrate of the First
c Class to the Court of Session. The question is whether the said
amendment is prospective and will be applicable only to the
offences committed after the date the amendment was notified
or would govern cases that were pending on the date of the
amendment or may have been filed after the same had become
operative?
D
7.2. The Full Bench has taken the view that since there is no
specific provision contained in the Amendment Act making the
amendment applicable to pending cases. the same would not apply
to cases that were already filed before the Magistrate. This implies
that if a case had not been filed up to the date the Amendment
E Act came into force, it would be governed by the amended Code
and hence b¢ triable only by the Sessions Court.
7.3. The Code of Criminal Procedure does not, however, provide
any definition of" institution of a case". It is, however, trite that a
case must be deemed to be instituted only when the court
F competent to take cognizance of the offence alleged therein does
so. The cognizance can, in tum, be taken by a Magistrate on a
complaint of facts filed before him which constitute such an
offence. It may also be taken if a police report is filed before the
Magistrate in writing of such facts as would constitute an offence.
G The Magistrate may also take cognizance of an offence on the
basis of his knowledge or suspicion uoon receipt of the information
from any person other than a police officer. In the case of the
Sessions Court, such cognizance is taken on commitment to it by
a Magistrate duly empowered in that behalf. All this implies that
the case is instituted in the Magistrate's court when the Magistrate
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 601
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
takes cognizance of an offence, in which event the case is one A
instituted on a complaint or a police report. The decision of this
CourtinJamuna Singh v. Bhadai Shah AIR 1964 SC 1541, clearly
explains the legal position in this regard.
7.4. To the same effect is the decision of this Court in Devarapalli
Lakshminarayana Reddy v. V. Narayana Reddy (1976) 3 SCC B
252 (SCC p. 257, para 14), where this Court held that a case can
be said to be instituted in a court only when the court takes
cognizance of the offence alleged therein and that cognizance
can be taken in the manner set out in clauses (a) to (c) of Section
190(1) CrPC. We may also refer to the decision of this Court in
Kamlapati Trivedi v. State ofW.B. (1980) 2 SCC 91, where this c
Court interpreted the provisions of Section 190 CrPC and
reiterated the legal position set out in the earlier decisions.
8. Applying the test judicially recognised in the above
pronouncements to the case at hand, we have no hesitation in
holding that no case was pending before the Magistrate against D
the appellant as on the date the Amendment Act came into force.
That being so, the Magistrate on receipt of a charge-sheet which
was tantamount to institution of a case against the appellant was
duty-bound to commit the case to the Sessions as three of the
offences with which he was charged were triable only by the E
Court of Session. The case having been instituted after the
Amendment Act had taken effect, there was no need to look for
any provision in the Amendment Act for determining whether the
amendment was applicable even to the pending matters as on the
date of the amendment no case had been instituted against the
appellant nor was it pending before any court to necessitate a F
search for any such provision in theAmendment Act. The Sessions
Judge as also the High Court were, in that view, perfectly justified
in holding that the order of committal passed by the Magistrate
was a legally valid order and the appellant could be tried only by
the Court of Session to which the case stood committed." G
21. Learned senior counsel emphasized, that it was not necessary
for him to refer to different decisions of this Court on the issue, since all
the relevant judgments had already been dealt with in the Ramesh Kumar
Soni case (supra). It was submitted, that it would suffice if this Court,
with reference to the present case, adverts to the legal position expressed H
602 SUPREME COURT REPORTS [2017] 13 S.C.R.
A in the above judgment (rendered on an analysis of earlier judgments).
Learned senior counsel, pointedly drew our attention to the following
observations recorded in the above judgment:
"l 0. In New India Insurance Co. Ltd. v. Shanti Misra (1975) 2
SCC 840, this Court was dealing with the claim of payment of
B compensation under the Motor Vehicles Act. The victim of the
accident had passed away because of the vehicular accident before
the con$titution of the Claims Tribunal under the Motor Vehicles
Act, 1939, as amended. The legal heirs of the deceased filed a
claim petition for payment of compensation before the Tribunal
after the Tribunal was established. The question that arose was
c whether the claim petition was maintainable having regard to the
fact that the cause of action had arisen prior to the change of the
forum for trial of a claim for payment of compensation. This Court
held that the change of law operates retrospectively even if the
cause of action or right of action had accrued prior to the change
D of forum. The claimant shall, therefore, have to approach the forum
as per the amended law. The claimant, observed this Court, had a
"vested right of action" but not a "vested right of forum". It also
held that unless by express words the new forum is available only
to causes of action arising after the creation of the forum, the
general rule is to make it retrospective. The following passages
E are in this regard apposite: (SCC pp. 844-45, paras 5-6)
"5. Qn the plain language of Sections 110-A and 110-F there
should be no difficultv in taking the view that the change in law
was merely a change of forum i.e. a change of adjectival or
procedural law and not of substantive law. It is a well-
F established proposition that such a change of law operates
retrospectively and the person has to go to the new forum
even if his cause of action or right of action accrued prior to
the change of forum. He will have a vested right of action but
not a vested right of forum. Ifby express words the new forum
G is made available only to causes of action arising after the
creation of the forum, then the retrospective operation of the
law is taken away. Otherwise the general rule is to make it
retrospective. The expressions 'arising out of an accident'
occurring in sub-section (1) and 'over the area in which the
accident occurred', mentioned in sub-section (2) clearly show
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 603
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
that the change of forum was meant to be operative A
retrospectively irrespective of the fact as to when the accident
occurred. To that extent there was no difficulty in giving the
answer in a simple way. But the provision of limitation of 60
days contained in sub-section (3) created an obstacle in the
straight application of the well-established principle oflaw. If B
the accident had occurred within 60 days prior to the constitution
of the tribunal then the baroflimitation provided in sub-section
(3) was not an impediment. An application to the tribunal could
be said to be the only remedy. If such an application, due to
one reason or the other, could not be made within 60 days then
the tribunal had the power to condone the delay under the C
proviso. But ifthe accident occurred more than 60 days before
the constitution of the tribunal then the bar oflimitation provided
in sub-section (3) of Section 110-A on its face was attracted.
This difficulty oflimitation led most of the High Courts to fall
back upon the proviso and say that such a case will be a fit one D
where the tribunal would be able to condone the delay under
the proviso to sub-section (3), and led others to say that the
tribunal will have no jurisdiction to entertain such an application
and the remedy of going to the civil court in such a situation
was not barred under Section 110-F of the Act. While taking
the latter view the High Court failed to notice that primarily E
the law engrafted in Sections 110-A and 110-F was a law
relating to the change of forum.
6. In our opinion in view of the clear and unambiguous language
of Sections 110-A and 110-F it is not reasonable and proper to
allow the law of change of forum give way to the bar of F
limitation provided in sub-section (3) of Section 110-A. It must
be vice versa. The change of the procedural law of forum
must be given effect to. The underlying principle of the change
of law brought about by the amendment in the year 1956 was
to enable the claimants to have a cheap remedy of approaching
the claims tribunal on payment of a nominal court fee whereas G
a large amount of ad valorem court fee was required to be
paid in civil court."
11. In Hitendra Vishnu Thakur v. State of Maharashtra (1994) 4
SCC 602, one of the questions which this Court was examining
H
604 SUPREME COURT REPORTS [2017] 13 S.C.R.
A was whether clause (bbl of Section 20(4) of the Terrorist and
Disruptive Activities (Prevention) Act, 1987 introduced by an
Amendment Act governing Section 167(2) CrPC in relation to
TADA matters was in the realm of procedural law and if so,
whether the same would be applicable to pending cases.
Answering the question in the affirmative this Court speaking
B
through A.S. Anand, J. (as His Lordship then was), held that
Amendment Act 43 of 1993 was retrospective in operation and
that clauses (bl and (bbl of sub-section (4 l of Section 20 ofTADA
apply to the cases which were pending investigation on the date
,vhen the amendment came into force. The Court summed up the
c legal position with regard to the procedural law being retrospective
in its operation and the right of a litigant to claim that he be tried
by a particular Court, in the following words: (SCC p. 633, para
26)
"(i) A statute which affects substantive rights is presumed to
D be prospective in operation unless made retrospective, either
expressly or by necessary intendment, whereas a statute which
merely affects procedure, unless such a construction is textually
impo$sible, is presumed to be retrospective in its application,
should not be given an extended meaning and should be strictly
confined to its clearly defined limits.
E
(ii) Law relating to forum and limitation is procedural in nature,
whereas law relating to right of action and right of appeal even
though remedial is substantive in nature.
(iii) Every litigant has a vested right in substantive law but no
F such right exists in procedural law.
(iv) A procedural statute should not generally speaking be
applied retrospectively where the result would be to create
new disabilities or obligations or to impose new duties in respect
of transactions already accomplished.
G (v) A statute which not only changes the procedure but also
creates new rights and liabilities shall be construed to be
prospective in operation, unless otherwise provided, either
expressly or by necessary implication."
xxx xxx xxx
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 605
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
13. In Shiv Bhagwan Moti Ram Saraoji case (1952) 54 Born LR A
330, the Bombay High Court has held procedural laws to be in
force unless the legislatures expressly provide to the contrary.
The Court observed: (Born LR p. 352)
" ... Now. I think it may be stated as a general principle that no
party has a vested right to a particular proceeding or to a B
particular forum. and it is also well settled that all procedural
laws are retrospective unless the legislature expressly states
to the contrarv. Therefore. procedural laws in force must be
applied at the date when a suit or proceeding comes on for
trial or disposal."
c
14. The amendment to the Criminal Procedure Code in the instant
case has the effect of shifting the forum of trial of the accused
from the Court of the Magistrate, First Class to the Court of
Session. Apart from the fact that as on the date the amendment
came into force no case had been instituted against the appellant
nor had the Magistrate taken cognizance against the appellant, D
any amendment shifting the forum of the trial had to be on principle
retrospective in nature in the absence of any indication in the
Amendment Act to the contrary The appellant could not claim a
vested right of forum for his trial for no such right is recognised.
The High Court was. in that view of the matter, justified in (sic E
not) interfering with the order passed by the trial court.
15. The questions formulated by the Full Bench of the High Court·
were answered in the negative holding that all cases pending in
the Court of the Judicial Magistrate, First Class as on 22-2-2008
when the amendment to the First Schedule to CrPC became F
operative, will remain unaffected by the said amendment and such
matters as were, in the meanwhile committed to the Court of
Session, will be sent back to the Judicial Magistrate, First Class
for trial in accordance with law. In coming to that conclusion the
Full Bench placed reliance upon three decisions of this Court in
Manujendra Dutt v. Pumedu Prosad Roy Chowdhury AIR 1967 G
.SC 1419, CIT v. R. Sharadamma (1996) 8 SCC 388 and R.
Kapilnath v. Krishna (2003) 1 SCC 444. The ratio of the above
decisions, in our opinion, was not directly applicable to the fact
situation before the Full Bench. The Full Bench of the High Court
was concerned with cases where evidence had been wholly or H
606 SUPREME COURT REPORTS [2017] 13 S.C.R.
A partly recorded before the Judicial Magistrate, First Class when
the same were committed to the Court of Session pursuant to the
amendment to the Code of Criminal Procedure. The decisions
upon which the High Court placed reliance did not, however, deal
with those kind of fact situations.
B 16. In Manujendra Dutt case the proceedings in the Court in which
the suit was instituted had concluded. At any rate, no vested right
could be claimed for a particular forum for litigation. The decisions
of this Court referred to by us earlier settle the legal position which
bears no repetition. It is also noteworthy that the decision in
Manujendra Dutt case was subsequently overruled by a seven-
c Judge Bench of this Court in V. Dhanapal Chettiar v. Yesodai
Ammal ( 1979) 4 SCC 214 though on a different legal point.
17. So also the decision of this Court in R. Sharadarnma case
( 1996) 8 SCC 388 relied upon by the Full Bench was distinguishable
on facts. The question there related to a liability incurred under a
D repealed enactment. The proceedings in the forum in which the
case was instituted had concluded and the matter had been referred
to the inspecting Assistant Commissioner before the dispute
regarding jurisdiction arose.
18. The decision of this Court in R. Kapilnath case (2003) I SCC
E 444, relied upon by the Full Bench was also distinguishable since
that was a case where the eviction proceedings before the Court
of Munsif under the Karnataka Rent Control Act, 1961 had
concluded when the Karnataka Rent Control (Amendment) Act,
1994 came into force. By that amendment, the Court of Munsif
F was deprived of jurisdiction in such cases. This Court held that
the change of forum did not affect pending proceedings. This Court
further held that the challenge to the competence of the forum
was raised for the first time, that too as an additional ground before
this Court and that, for other factors, the Court was inclined to
uphold the jurisdiction of the Court of Munsif to entertain and
G adjudicate upon the eviction matter. The fact situation was thus
different in this case.
19. Even otherwise the Full Bench failed to notice the law declared
by this Court in a series of pronouncements on the subject to
which we may briefly refer at this stage. In Nani Gopal Mitra v.
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 607
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
State of Bihar AIR 1970 SC 1636, this Court declared that A
amendments relating to procedure operated retrospectively subject
to the exception that whatever be the procedure which was
correctly adopted and proceedings concluded under the old law
the same cannot be reopened for the puroose ofapplying the new
procedure. In that case the trial of the appellant had been taken
B
up by Special Judge, Santhal Paraganas when Section 5(3) of the
Prevention of Corruption Act, 1947 was still operative. The
appellant was convicted by the Special Judge before the
Amendment Act repealing Section 5(3) was promulgated. This
Court held that the conviction pronounced by the Special Judge
could not be termed illegal just because there was an amendment c
to the procedural law on 18-12-1964. The following passage is, in
this regard, apposite: (AIR p. 1639, paras 5-6)
"5 .... It is therefore clear that as a general rule the amended
law relating to procedure operates retrospectively. But there
is another equally important principle viz. that a statute should D
not be so construed as to create new disabilities or obligations
or impose new duties in respect of transactions which were
complete at the time the amending Act came into force (see A
Debtor, In re, exp Debtor (1936) 1Ch237 (CA) andAttorney
General v. Vernazza 1960 AC 965). The same principle is
embodied in Section 6 of the General Clauses Act which is to E
the following effect:
• • •
6. The effect of the application of this principle is that pending
cases, although instituted under the old Act but still pending. F
are governed by the new procedure under the amended law,
but whatever procedure was correctly adopted and concluded
under the old law cannot be opened again for the purpose of
applying the new procedure. In the present case, the trial of
the appellant was taken up by the Special Judge, Santhal
Parganas when Section 5(3) of the Act was still operative. G
The conviction of the appellant was pronounced on 31-3-1962
by the Special Judge, Santhal Parganas, long before the
amending Act was promulgated. It is not hence possible to
accept the argument of the appellant that the conviction
pronounced by the Special Judge, Santhal Parganas, has H
608 SUPREME COURT REPORTS [2017] 13 S.C.R.
A become illegal or in any way defective in law because of the
amendment to procedural law made on 18-12-1964. In our
opinion, the High Court was right in invoking the presumption
under Section 5(3) of the Act even though it was repealed on
18-12-1964 by the amending Act. We accordingly reject the
argument of the appellant on this aspect of the case."
B
20. Reference may also be made upon the decision of this Court
in Anant Gopal Sheorey v. State of Bombay AIR l 958 SC 915,
where the legal position was stated in the following words: (AIR
p. 917, para 4)
c "4. The question that arises for decision is whether to a pending
prosecution the provisions of the amended Code have become
applicable. There is no controversy on the general principles
applicable to the case. No person has a vested right in any
course of procedure. He has only the right of prosecution or
defence in the manner prescribed for the time being by or for
D the court in which the case is pending and if by an Act of
Parliament the mode of procedure is altered he has no other
right than to proceed according to the altered mode. See
Maxwell on Interpretation of Statutes on p. 225; Colonial Sugar
Refining Co. Ltd. v. Irving, 1905 AC 369, AC p. 372. In other
E words a change in the law of procedure operates retrospectively
and unlike the law relating to vested right is not only
prospective."
21. The upshot of the above discussion is that the view taken by
the Full Bench holding the amended provision to be inapplicable
F to pending cases is not correct on principle. The decision rendered
by the Full Bench would, therefore, stand overruled but only
prospectively. We say so because the trial of the cases that were
sent back from the Sessions Court to the Court of the Magistrate,
First Class under the orders of the Full Bench may also have
been concluded or may be at an advanced stage. Any change of
G forum at this stage in such cases would cause unnecessary and
avoidable hardship to the accused in those cases if they were to
be committed to the Sessions for trial in the light of the amendment
and the view expressed by us."
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 609
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
22. It was also the contention of learned counsel for the private A
parties, that 'the 2002 Amendment Act' does not indicate the desire of
the legislature in divesting proceedings which were earlier pending before
a Metropolitan Magistrate (or, a Judicial Magistrate, as the case may
be). In order to substantiate the instant contention, learned counsel, in
the first instance, placed reliance on the statement ofobjects and reasons
B
of the Securities and Exchange Board oflndia (Amendment) Act, 2002.
The same is extracted hereunder:
"The Securities and Exchange Board of India (SEBI) Act, 1992
was enacted to provide for the establishment of a Board to protect
the interests of investors in securities and to promote the
development of, and to regulate, the securities market and for c
matters connected therewith or incidental thereto.
2. Recently many shortcomings in the legal provisions of the
Securities and Exchange Board of India Act, 1992 have been
noticed, particularly with respect to inspection, investigation and
enforcement. Currently, the SEBI can call for information, D
undertake inspections, conduct enquiries and audits of stock
exchanges, mutual funds, intermediaries, issue directions, initiate
prosecution, order suspension or cancellation of registration.
Penalties can also be imposed in case of violation of the provisions
of the Act or the rules or the regulations. However, the SEBI has E
no jurisdiction to prohibit issue of securi~ies or preventing siphoning
of funds or asset stripping by any company. While the SEBI can
call for information from intermediaries, it cannot call for
information from any bank and other authority or board or
corporation established or constituted by or under any Central,
State or Provincial Act. The SEBI cannot retain books of account, F
documents, etc'.·, in its custody. Under the existing provisions
contained in the Securities and Exchange Board of India Act,
1992, the SEBI cannot issue commissions for the examination of
witnesses or documents. Further. the SEBI has pointed out that
existing penalties are too low and do not serve as effective G
deterrents. At present, under section 209 A of the Companies Act,
l 956, the SEBI can conduct inspection oflisted companies only
for violations of the provisions contained in sections referred to in
section 55A of that Act but it cannot conduct inspection of any
listed public company for violation of the SEBI Act or rules or
regulations made thereunder. H
610 SUPREME COURT REPORTS [2017) 13 S.C.R.
A 3. In addition, growing importance of the securities markets in the
economy has placed new demands upon the SEBI in terms of
organisation structure and institutional capacity. A need was
therefore felt to remove these shortcomings by strengthening the
mechanisms available to the SEBI for investigation and
enforcement so that it is better equipped to investigate and enforce
B
>1_gainst mwket malpractices.
4. In view of the above, the Securities and Exchange Board of
India (Amendment) Ordinance, 2002 (Ord. 6 of 2002) was
promulgated on the 29th October, 2002 to amend the Securities
and Exchange Board of India Act, I 992.
c
5. It is now proposed to replace the Ordinance by a Bill, with,
inter alia, the following features-
( a) increasing the number of members of the SEBI from six
(including Chairman) to nine (including Chairman);
D (b) conferring power upon the Board for,-
(i) calling for information and record from any bank or other
authority <:>r Board or corporation established or constituted by or
under any Central, State or Provincial Act in respect of any
transactioµ in securities which are under investigation or inquiry
E by the Board;
(ii) passing an order for reasons to be recorded in writing, in the
interest of investors or securities market, either pending
investigation or inquiry or on completion of such investigation or
inquiry for taking any of the following measures, namely, to---·
F
(A) suspend the trading of any security in a recognised stock
exchange;
(B) restrain persons from accessing the securities market and
prohibit any person associated with securities market to buy, sell
or deal in securities;
G
(CJ suspend any office-bearer of any stock exchange or self-
regulatory organisation from holding such position;
(D) impound and retain the proceeds or securities in respect of
any transaction which is under investigation;
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 611
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
(E) attach, after passing of an order on an application made for A
approval by the Judicial Magistrate of the first class having
jurisdiction, for a period not exceeding one month, one or more
bank account or accounts of any intermediary or any person
associated with the securities market in any manner involved in
violation of any of the provisions of this Act, or the rules or the
B
regulations made thereunder;
(F) direct any intermediary or any person associated with the
securities market in any manner not to dispose of or alienate an
asset forming part of any transaction which is under investigation;
(iii) regulating or prohibiting for the protection of investors, issue c
of prospectus, offer document or advertisement soliciting money
for issue of securities;
(iv) directing any person to investigate the affairs of intermediary
or person associated with the securities market and to search and
seize books, registers, other documents and records considered D
necessary for the purposes of the investigation, with the prior
approval of a Magistrate of the first class;
(v) passing an order requiring any person who has violated or is
likely to violate, any provision of the SEBI Act or any rules or
regulations made thereunder to cease and desist for committing E
and causing such violation;
(c) prohibiting manipulative and deceptive devices, insider trading,
fraudulent and manipulative trade practices, market manipulation
and substantial acquisition of securities and control;
(d) crediting sums realised by way of penalties to the Consolidated F
Fund oflndia;
( e) amending the composition of the Securities Appellate Tribunal
from one person to three persons;
(f) changing the qualifications for appointment as Presiding Officer
and members of the Securities Appellate Tribunal; G
(g) composition of certain offences by the Securities Appellate
Tribunal;
H
612 SUPREME COURT REPORTS [2017] 13 S.C.R.
A (h) conferring power upon the Central Government to grant
immunity;
(i) appeal to the Supreme Court from the orders of the Securities
Appellate Tribunal;
(j) enhanqing the penalties specifi.l'_cl i_rU!i" SEBJAct.
B
6. The Bill seeks to achieve the above objects."
Reading extensively from the objects and reasons extrncted above,
it was submittecj, that the aforestated amendment was primarily aimed
at remedying the shortcomings in 'the SEBI Act', particularly, with
C reference to inspection, investigation and enforcement. It was also pointed
out, that the said amendment was aimed at enhancing the penalties
postulated for violation of the provisions of 'the SEBI Act', inasmuch as,
the existing penalties did not serve as an effective deterrent. It was
submitted, that 'the 2002 Amendment Act' was an in-depth restructuring
of the SEBI (by increasing the numberof its members), and by conferring
D further powers on the Securities & Exchange Board of India. It was
submitted, that the change of 'forum' emerging out of the provisions of
'the 2002 Amendment Act', was not even referred to in the statement
of objects and reasons. And as such, it was not proper for this Court.to
draw any inference, merely on the premise, that a procedurnl amendment
E had been contemplated by changing the existing 'forum (to that of the
Court of Session). It was submitted, that an overall analysis of 'the
2002 Amendment Act' would demonstrate, that the erstwhile penalties
under the original SEBI Act (under Section 24), were of a trivial nature.
Inasmuch as, the contravention of the provisions of 'the SEBI Act' or
any rules and regulations made thereunder, was punishable with
F imprisonment" ... for a term which may extend to one year, or with fine,
or with both". Referring to sub-section (2) of Section 24 it was submitted,
that for failing to comply with the directions or orders of adjudicating
officers, under 'the SEBI Act', the punishment provided for, was of
" ... not less than one month, but which may extend to three years or with
G fine which shall not be less than two thousand rupees but which may
extend to ten thousand rupees or with both.". In consonance with the
above level of punishment, it was not only appropriate, but also justified,
that the proceedings should be conducted by the Court of a Metropolitan
Magistrate (or, a Judicial Magistrate, as the case m~y be). It was
submitted, that all the matters arising for adjudication before this Court,
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 613
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
in the present set of cases, can only be punished with imprisonment and A
fine, as has been noticed herein above. In addition to the factual position
narrated hereinabove, it was highlighted, that the punishment contemplated
under Section 24 of 'the SEBI Act', was altered by 'the 2002 Amendment
Act' whereby, consequent upon the contravention of the provisions of
'the SEBI Act' or any rules or regulations made thereunder, the offender
B
was " ... punishable with imprisonment for a term which may extend to
ten years, or with fine, which may extend to twenty-five crore rupees or
with both." Additionally referring the amendment of Section 24(2) by
'the 2002AmendmentAct', it was submitted, that for failing to comply
with any of the directions or orders of an adjudicating officer, the
punishment contemplated was " ... imprisonment for a term which shall c
not be less than one month but which may extend to ten years or with
fine, which may extend to twenty-five crore rupees or with both." It
was submitted, that the private parties herein, cannot be required to
suffer the punishment contemplated under Section 24, consequent upon
its amendment by 'the 2002 Amendment Act'. It was submitted, that on
D
account of the enhanced punishment under Section 26(2) of 'the 2002
Amendment Act' postulated, that no court inferior to that of a Court of
Session, would try any offence triable under 'the SEBI Act'. It was
submitted, that any change of 'forum', whilst the penal consequences
remained unchanged, was absurd. According to learned counsel
representing the private parties, the change of 'forum' (through 'the E
2002AmendmentAct') was aimed at bringing the 'forum' ofadjudication,
at par with the 'forum' contemplated for similar penal consequences,
under the Code of Criminal Procedure. It was submitted, that it could
never have been the intention of the legislature through 'the 2002
Amendment Act', to alter the 'forum' foroffences with trivial punishments
(as is the case, with the private parties herein). F
23. In order to substantiate the contention advanced in the foregoing
paragraph, learned counsel has placed reliance on Commissioner of
Income Tax, Orissa v. Dhadi Sahu, 1994 Supp (1) SCC 257, and drew
our attention to the following observations recorded therein:
G
"5. Pending reference of the case before the Inspecting Assistant
Commissioner. Section 274(2) of the Act was amended with effect
from April !, 1971 by the Taxation Laws (Amendment) Act. 1970
(hereinafter referred to as 'the Amending Act') so as to read as
follows:
H
614 SUPREME COURT REPORTS [2017] 13 S.C.R.
A "Notwithstanding anything contained in clause (iii) of sub-section
(I) of Section 27 l if in a case falling under clause (c) of that sub-
section, the amount of income (as determined by the Income Tax
Officer on assessment) in respect of which the particulars have
been concealed or inaccurate particulars have been furnished
exceeds a sum of twenty-five thousand rupees the Income Tax
B
Officer shall refer the case to the Inspecting Assistant
Commissioner. who shall. for the purpose, have all the powers
conferred under this chapter for the imposition of penalty."
xxx xxx xxx
c 18. It may be stated at the outset that the general principle is that
a Jaw which brings about a change in the forum does not affect
pending qctions unless intention to the contrary is clearly shown.
One of the modes by which such an intention is shown is by making
a provision for change-over of proceedings, from the court or the
tribunal where they are pending to the court or the tribunal which
D under the new law gets jurisdiction to try them.
xxx xxx xxx
20. It will be noticed that the amending Act did not make any ·-
provision that the references validly pending before the Inspectin~
E Assistant Commissioner shall be returned without passing any
final order if the amount of income in respect of which the
particulars have been concealed did not exceed Rs 25,000. This
supports the inference that in pending references the Inspecting
Assistant Commissioner continued to have jurisdiction to impose
penalty. The previous operation of Section 274(2) as it stood before
F April 1, 1971, and anything done thereunder continued to have
effect under Section 6(b) of the General Clauses Act, 1897, ·
enabling the Inspecting Assistant Commissioner to pass orders
imposing penalty in pending references. In our opinion, therefore,
what is material to be seen is as to when the references were
initiated. If the reference was made before April l, l 97 l, it would
G
be governed by Section 274(2) as it stood before that date and
Inspecting Assistant Commissioner would have jurisdiction to pass
the order of penalty.
21. It is also true that no litigant has any vested right in the matter
of procedural law but where the question is ofchange of forum it
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 615
CREDIT LTD. [JAGDISH SINGH K.HEHAR, CJ!]
ceases to be a question of procedure only. The forum of appeal or A
proceedings is a vested right as opposed to pure procedure to be
followed before a particular forum The right becomes vested
when the proceedings are initiated in the tribunal or the court of
first instance and unless the legislature has by express words or
by necessary implication clearly so indicated, that vested right
B
will continue in spite of the change of jurisdiction of the different
tribunals or forums."
Reliance was also placed on R. Kapilnath v. Krishna, (2003) I
SCC 444, wherein the Court's pointed attention was drawn to the following
observations:
c
"4. The above submission of the learned counsel has been stated
only to be rejected. It is pertinent to note that the proceedings in
the Court ofMunsiffhad already stood concluded by the time the
amendment came into force. It is not disputed that Amendment
Act 32of1994 has not been given a retrospective operation and
there is nothing in the Act to infer retrospectivity by necessary D
implication. The Act has been specifically brought into force w.e.f.
the 18th day of May, 1994. The learned counsel forthe appellant
cited a number of decisions laying down the law as to how an
amendment in legislation brought into force during the pendency
of legal proceedings has to be given effect to. Without stating the E
decisions so cited, suffice it to observe that all those decisions
deal with substantive rights having been created or abolished during
the pendency of legal proceedings and.depending on the legislative
intent and the language employed by the legislature in the relevant
enactment, this Court has determined the impact of the legislation
on pending proceedings and the power of the court to take note of F
change in law and suitably mould the relief consistently with the
legislative changes. So far as the present case is concerned, the
only submission made by the learned counsel for the appellant is
that the effect of the amendment is to deprive the Court ofMunsiff
of its jurisdiction to hear and decide the proceedings for eviction G
over such premises as the suit premises are. In other words, it is
a change in forum brought during the pendency of the proceedings.
The correct approach to be adopted in such cases is that a new
law bringing about a change in forum does not affect pending
actions, unless a provision is made in it for changeover of
H
616 SUPREME COURT REPORTS [2017] 13 S.C.R.
A proceedings or there is some other clear indication that pending
actions are affected. (See Principles of Statutory Interpretation,
Justice GP. Singh, 8th Edn., 2001, p. 442.) We have already
indicated that the Act does not bring about a change in forum so
far as the pending actions are concerned. Moreover. by the time
the amendment came into force. the proceedings before the Munsiff
B
had already stood concluded and the case was pending at the
stage ofrevision before the Additional District Judge. Further, we
find that an objection laying challenge to the forum's competence
was not raised before the learned Additional District Judge nor
was the objection taken before the High Court in the civil revision
c preferred by the appellant. It was not taken as a ground in the
special leave petition. It has been taken only by way of a separate
petition filed subsequently and seeking leave to urge additional
grounds. Such an objection cannot be allowed to be urged so
belatedly. However, we have already held the argument based on
the 1994 Amendment as of no merit."
D
Based on the aforestated submissions, it was contended, that 'the
2002 Amendment Act' did not expressly or impliedly choose to alter the
forum of pending matters, wherein cognizance had already been taken.
Referring to Section 26B, introduced into 'the SEBI Act' by 'the 2002
Amendment Act', learned counsel emphasized on " ... shall be taken
E cognizance of and tried ... ". Relying on the aforestated words used in
Section 26B, it was asserted, that the intent of the legislature was that
the change of'forum' would apply only to matters, wherein cognizance
had not been taken. It was submitted, that there was no question of
taking fresh cognizance, where cognizance had already been taken. It
F was accordingly sought to be inferred, that the clear intent indicated by
the legislature was, that the change of'forum' would be applicable, only
in matters wherein cognizance had not been taken.
24. Learned senior counsel, then placed reliance on Videocon
International Limited v. Securities and Exchange Board oflndia, (2015)
G 4 SCC 33. It was submitted, that the instant judgment of this Court had
taken into consideration a number of previous judgments rendered by it,
forrecording its final conclusions. As such, it was submitted, that reliance
on the instant judgment, would obviate the necessity of reference to
other judgments of this Court (on the question in hand). Learned counsel
placed reliance on the observations and conclusions, recorded in the
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 617
CREDIT LTD. [JAGDISH SINGH KHEHAR, CH]
Videocon International Limited case (supra), by placing reliance on the A
following paragraphs:
"7. The High Court by the impugned order arrived at the conclusion,
that such of the appeals as had been filed before the coming into
force of the amended Section 15-Z, would not be affected by the
amendment, and the High Court had the jurisdiction to hear and B
dispose of the same. The High Court also concluded, that such of
the appeals as had been filed after the coming into force of the
amended Section 15-Z, would not be maintainable.
xxx xxx xxx
29. According to the learned counsel, a perusal of the above c
judgment in Dhadi Sahu case revealed, that change of forum could
be substantive or procedural. It Vl'.Ould be procedural when the
remedy has yet to be availed of. But where the remedy had already
been availed of (under an existing statutory provision), the right
crystallised into a vested substantive right. In the latter situation, D
according to the learned counsel, unless the amending provision,
by express words or by necessary imp! ication mandates, the
transfer of pending proceedings to the forum introduced by the
amendment, the forum postulated by the unamended provision,
has the jurisdiction to adjudicate upon pending matters (filed before
the amendment). E
xxx xxx xxx
30. According to the learned counsel, his submission also flows
from the mandate contained in Section 6 of the General Clauses
Act, 1897. For this, the learned counsel placed reliance onAmbalal
Sarabhai Enterprises Ltd. v. AmritLal and Co (2001) 8 SCC 397. F
In the above-cited judgment, the respondent landlord had filed an
eviction petition on l 3;9-1985 against the appellant, under Section
14( 1)(b) of the Delhi Rent Control Act. When the above petition
was pending, Section 31 c) was brought in through an amendment
with effect from 1-12-1988. By the above amendment, the G
jurisdiction of the Rent Controller. with respect to tenancies which
fetched a monthly rent exceeding Rs 3500, was excluded.
Consequent upon the aforesaid amendment, the appellant tenant
contended, that the civil court alone, had the jurisdiction to entertain
the claim raised by the landlord, and that, the eviction petition filed
H
618 SUPREME COURT REPORTS [2017) 13 S.C.R.
A under the provisions of the Delhi Rent Control Act, was no longer
maintainable.
31. While adjudicating the aforesaid dispute, this Court held as
under: (Ambalal case, SCC pp. 409-10 & 415, paras 24-27 & 34-
36)
B "24. We may quote here Section 6 of the General Clauses Act,
1897:
'6. Eflfect of repeal.-Where this Act. or any Central Act or
regulation made after the commencement of this Act, repeals any
enactment hitherto made or hereafter to be made, then. unless a
c different intention appears, the repeal shall not-
( a) revive anything not in force or existing at the time at which the
repeal takes effect; or
(b) affect the previous operation of any enactment so repealed or
anything duly done or suffered thereunder; or
D
(c) affect any right, privilege, obligation or liability acquired, accrued
or incurred under any enactment so repealed; or
(d) affect any penalty, forfeiture or punishment incurred in respect
of any offence committed against any enactment so repealed; or
E ( e) affect any investigation. legal proceeding or remedy in respect
ofany such right, privilege, obligation, liability, penalty, forfeiture
or punishment as aforesaid,
and any such investigation, legal proceeding or remedy may be
instituted, continued or enforced, and any such penaltv, forfeiture
F or punishment may be imposed as if the repealing Act or Regulation
had not been passed.'
25. The opening words of Section 6 specify the field over which it
is operative. It is operative over all the enactments under the
General Clauses Act, Central Act or regulations made after the
G commencement of the General Clauses Act. It also clarifies in
case of repeal of any provision under the aforesaid Act or
regulation, unless a different intention appears from such repeal.
it would have no affect over the matters covered in its clauses
viz. (a) to (e). It clearly specifies that the repeal shall not revive
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 619
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
anything not in force or in existence or affect the previous A
operation of any enactment so repealed or anything duly done or
suffered or affect any right, privilege, obligation or liability acquired,
accrued or incurred under the repealed statute, affect any penalty,
forfeiture or punishment incurred in respect of any offence
committed under the repealed statute and also does not affect
B
any investigation, legal proceeding or remedy in respect of any
such right, privilege, obligation, liability, penalty, forfeiture or
punishment as aforesaid. Thus the central theme which spells out
is that any investigation or legal proceeding pending may be
continued and enforced as if the repealing Act or regulation had
not come into force. c
26. As a general rule. in view of Section 6, the repeal of a statute,
which is not retrospective in operation, does not prima facie affect
the pending proceedings which may be continued as ifthe repealed
enactment were still in force. In other words. such repeal does
not affect the pending cases which would continue to be concluded D
as if the enactment has not been repealed. In fact when a !is
commences, all rights and obligations of the parties get crystallised
on that date. The mandate of Section 6 of the General Clauses
Act is simply to leave the pending proceedings unaffected which
commenced under the unrepealed provisions unless contrary
intention is expressed. We find clause (c) of Section 6, refers the E
words 'any right, privilege, obligation ... acquired or accrued' under
the repealed statute would not be affected by the repealing statute.
We may hasten to clarify here, mere existence of a right not being
'acquired' or 'accrued', on the date of the repeal would not get
protection of Section 6 of the General Clauses Act. F
27. At the most, such a provision can be said to be granting a
privilege to the landlord to seek intervention of the Controller for
eviction of the tenant under the statute. Such a privilege is not a
benefit vested in general but is a benefit granted and may be
enforced by approaching the Controller in the manner prescribed G
under the statute. On filing the petition of eviction of the tenant
the privilege accrued with the landlord is not effected by repeal of
the Act in view of Section 6(c) and the pending proceeding is
saved under Section 6(e) of the Act.
••• H
620 SUPREME COURT REPORTS (2017] 13 S.C.R.
A 34. Thus we find Section 6 of the General Clauses Act covers a
wider field and saves a wide range or proceedings referred to in
its various clauses. We find two sets of cases, one where Section
6 of the General Clauses Act is applicable and the other where it
is not applicable.
B 35. In cases where Section 6 is not applicable, the courts have to
scrutinise and find, whether a person under a repealed statute
had any vested right. In case he had, then pending proceedings
would be saved. However, in cases where Section _6 is applicable,
it is not merely a vested right but all those covered under various
clause$ from (a) to (e) of Section 6. We have already clarified
c that right and privilege under it is limited to those which is 'acquired'
and 'accrued'. In such cases pending proceedings are to be
continued as if the statute has not been repealed.
36. In view of the aforesaid legal principle emerging, we come to
the conclusion that since proceeding for the eviction of the tenant
D was pending when the repealing Act came into operation, Section
6 of the General Clauses Act would be applicable in the present
case, as it is landlord's accrued right in terms of Section 6. Clause
(c) of Section 6 refers to 'any right' which may not be limited as
a vested right but is limited to be an accrued right. The words
E 'any right accrued' in Section 6(c) are wide enough to include
landlord's right to evict a tenant in case proceeding was pending
when repeal came in. Thus a pending proceeding before the Rent
Controller for the eviction of a tenant on the date when the
repealing Act came into force would not be affected by the
repealing statute and will be continued and concluded in accordance
F with the law as existed under the repealed statute."
Based on the above determination. it was the contention of the
learned counsel, that in addition to the existence ofa vested right,
Sections 6(c) and (e) make it abundantly clear, that a pending
legal proceeding or remedy, before the amendment altered the
G forum, would continue to be available for the adjudication of the
matter, unless the amending provision by express words or by
necessary implication expressed otherwise.
3 7. We have given our thoughtful consideration to the submissions
advanced at the hands of the learned counsel for the rival parties.
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 621
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
We shall now venture to determine the controversy which has A
been debated hereinabove. So as not to be required to repeatedly
express one foundational fact, it would be pertinent to mention,
that our determination, insofar as the present controversy is
concerned is with reference to situations wherein the amending
provision by express words or by necessary implication, does not
B
mandate the amendment to be either prospective or retrospective.
In the present case, the instant situation emerges from Section 32
of the Securities and Exchange Board of India (Amendment) Act, ·.
2002, which is silent on the above subject.
xxx xxx
xxx
c
44. It was also the contention of the learned counsel for the
appellant, that in the absence of a saving clause, the pending
proceedings (and the jurisdiction of the High Court), cannot be
deemed to have been saved. It is not possible for us to accept the
instant contention. In the judgment rendered by this Court in D
Ambalal Sarabhai Enterprises Ltd. case, it was held, that the
general principle was, that a law which brought about a change in
the forum, would not affect pending actions, unless the intention
to the contrary was clearly shown. Since the amending provision
herein does not so envisage, it has to be concluded, that the pending E
appeals (before the amendment of Section 15-Z) would not be
affected in any manner. Accordingly, for the same reasons as
have been expressed in the above judgment (relevant extracts
whereof have been reproduced above), we are of the view, that
the instant contention advanced at the hands of the learned counsel
for the appellant is wholly misconceived. Furthermore, the instant F
contention is wholly unacceptable in view of the mandate contained
in Sections 6(c) and (e) of the General Clauses Act, 1897. While
interoreting the aforesaid provisions this Court has held, that the
amendment of a statute, which is not retrospective in operation,
does not affect pending proceedings, except where the amending G
provision expressly or by necessary intendment provides
otherwise. Pending proceedings are to continue as if the
unamended provision is still in force. This Court has clearly
concluded, that when a iis commences, all rights and obligations
of the parties get crystallised on that date, and the mandate of
H
622 SUPREME COURT REPORTS (2017] 13 S.C.R.
A Section 6 of the General Clauses Act, simply ensures, that pending
proceedings under the unamended provision remain unaffected.
Herein also, therefore. our conclusion is the same as has already
been rendered by us, in the foregoing paragraphs.
45. Having concluded in the manner expressed in the foregoing
B paragraphs, it is not necessary for us to examine the main
contention, advanced at the hands of the learned counsel for the
appellant, namely, that the amendment to Section 15-Z of the SEBI
Act, contemplates a mere change of forum of the second appellate
remedy. Despite the aforesaid, we consider it just and appropriate,
in the facts and circumstances of the present case, to delve on
c the above subject as well. In dealing with the submission advanced
at the hands of the learned counsel for the appellant, on the subject
of forum, we will fictionally presume, that the amendment to
Section 15-Z by the Securities and Exchange Board of India
(Amendment) Act, 2002 had no effect on the second appellate
D remedy made available to the parties, and further that, the above
amendment merely alters the forum of the second appeal, from
the High Court (under the unamended provision), to the Supreme
Court (consequent upon the amendment). On the above
assumption, the learned counsel for the appellant had placed
reliance on the decisions rendered by this Court in Maria Cristina
E De Souza Sodder, Hitendra Vishnu Thakur and Thirumalai
Chemicals Ltd. cases to contend, that the law relating to forum
being procedural in nature, an amendment which altered the forum,
would apply retrospectively. Whilst the correctness of the aforesaid
contention cannot be doubted, it is essential to clarify, that the
F same is not an absolute rule. In this behalf, reference may be
made to the judgments relied upon by the learned counsel for the
respondent, and more importantly to the judgment rendered in
Dhadi Sahu case, wherein it has been explained, that an
amendment of forum would not necessarily be an issue of
procedure. It was concluded in the above judgment, that where
G the question is of change of forum, it ceased to be a question of
procedure, and becomes substantive and vested, if proceedings
stand initiated before the earlier prescribed forum (prior to the
amendment having taken effect). This Court clearly declared in
the above judgment, that ifthe appellate remedy had been availed
H of (before the forum expressed in the unamended provision) before
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 623
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI)
the amendment, the same would constitute a vested right However, A
if the same has not been availed of, and the forum of the appellate
remedy is altered by an amendment, the change in the forum.
would constitute a procedural amendment. as contended by the
learned counsel for the appellant. Conseguently even in the facts
and circumstances of the present case, all such appeals as had
been filed by the Board, prior to 29-10-2002, would have to be B
accepted as vested, and must be adjudicated accordingly."
25. Learned counsel for the private parties, emphasized the manner
in which legislative intent, in such matters, is usually expressed. It was
submitted, that it was usually provided for the amending provision itself.
This, according to learned counsel, could be done by expressly providing, C
that the pending matters would stand transferred to the new 'forum'.
The same objective could be achieved, by denuding the existing 'forum'
from jurisdiction. In order to demonstrate the aforesaid, learned counsel
placed reliance on Ambalal Sarabhai Enterprises Ltd. v. Amrit Lal &
Co., (2001) 8 SCC 397, wherein this Court held as under: D
"17. The aforesaid decision holds that tenants have no vested
right under the Rent Act. In effect, the law is well settled. Prior to
the enactment of the Rent Act the relationship between the landlord
and the tenant was governed by the general law, maybe the
Transferof Property Act or any other law in relation to the property. E
The Rent Act merely provides a protection to a tenant as against
the unbridled pcwer of the landlord under the general law of the
land. The Rent Act gives protection to the tenant from being ejected
except on the grounds referred to under the Rent Act. In other
words, it protects the tenant from ejectment, it protects a tenant
from the drastic enhancement of the rent by the landlord which F
may otherwise the landlord could do under the general law. Thus
the right of a tenant under the Rent Act at the best could be said
to be a protective right, which cannot be construed to be a vested
right. In effect, in view of this special enactment of the Rent Act,
the right and remedies available to a landlord under the general G
law remains suspended. In other words the landlord's vested right
under the general law continues so long it is not abridged by such
protective legislation, but the moment when this protection is
withdrawn the landlord's normal vested right reappears which
could be enforced by him.
H
624 SUPREME COURT REPORTS (2017] 13 S.C.R.
A xxx xxx xxx
34. Thus we find that Section 6 of the General Clauses Act covers
a wider field and saves wide range of proceedings referred to in
its various clauses. We find two sets of cases, one where Section
§of the General Clauses Act is applicable and the other where it
B is not applicable.
35. In cases where Section 6 is not applicable, the courts have to
scrutinise and find, whether a person under a repealed statute
had any vested right. In case he had, then pending proceedings
would be saved. However, in cases where Section 6 is applicable,
c it is n0t merely a vested right but all those covered under various
clauses from (a) to (e) of Section 6. We have already clarified
right and privilege under it is limited to that which is "acquired"
and "accrued". In such cases pending proceedings is to be
continued as if the statute has not been repealed.
D
36. ln view of the aforesaid legal principle emerging, we come to
the conclusion that since proceeding for the eviction of the tenant
was pending when the repealing Act came into operation, Section
§of the General Clauses Act would be applicable in the present
case, as it is the landlord's accrued right in terms of Section 6.
E Clause (c) of Section 6 refers to "any right" which may not be
limited as a vested right but is limited to be an accrued right. The
words "any right accrued" in Section 6( c) are wide enough to
include landlord's right to evict a tenant in case proceeding was
pending when repeal came in. Thus a pending proceeding before
the Rent Controller for the eviction of a tenant on the date when
F the repealing Act came into force would not be affected by the
repealing statute and will be continued and concluded in accordance
with the law as existed under the repealed statute."
26. Reliance was also placed on Commissioner of Income Tax,
G Orissa v. Dhadi Sahu, 1994 Supp (I) SCC 257. and invited our attention
to the following:
"5. Pending reference of the case before the Inspecting Assistant
Commissioner, Section 274(2) of the Act was amended with effect
from April I. 1971 by the Taxation Laws (Amendment) Act. 1970
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 625
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
(hereinafter referred to as 'the Amending Act') so as to read as A
follows:·
"Notwithstanding anything contained in clause (iii) of sub-section
( 1) of Section 271 if in a case falling under clause (c) of that sub-
section, the amount of income (as determined by the Income Tax
Officer.on assessment) in respect of which the particulars have B
been concealed or inaccurate particulars have been furnished
exceeds a sum of twenty-five thousand rupees the Income Tax
Officer shall refer the case to the Inspecting Assistant
Commissioner. who shall. for the purpose, have all the powers
conferred under this chapter for the imposition of penalty."
c
xxx xxx xxx
9. On the Revenue's application, the Appellate Tribunal stated the
consolidated case to the Orissa High Court under Section 256( 1)
of the Act and referred the following question of law:
Whether, on the facts and Circumstances of the case, and on a D
true interpretation of Section 274, as amended by the Taxation
Laws (Amendment) Act, 1970, the Inspecting Assistant
Commissioner to whom the case was referred prior to April 1,
1971, had jurisdiction to impose penalty?
xxx xxx xxx E
13. The .learned Judges of the Orissa High Court agreed with the
appellate order of the Income Tax Appellate Tribunal, Cuttack
dated December 19, 1973 and took the view thus:
"If the Inspecting Assistant Commissioner had passed final orders
F
prior to the amending Act of 1970, there would have been ·no
question ofloss ofjurisdiction, but as the matter was still oending
and by change of procedure the references became incompetent,
the Inspecting Assistant Commissioner had no jurisdiction to
complete the proceedings. because he.had no longer jurisdiction
to deal with the'matter of this tvoe. We are of the view that the G
Tribunal came to the right conclusion on the. facts of the case.
Our answer to th~ question referred to us,. therefore, is:
On the facts and in the circumstances of the case. and on a true
inte1pretation of Section 274. as amended by the Taxation Laws
H
626 SUPREME COURT REPORTS [2017] 13 S.C.R.
A {Amendment) Act of 1970, the Inspecting Assistant Commissioner
to whom the case had been referred prior to 1971 had no
jurisdiction to impose penalty."
xxx xxx xxx
18. It may be stated at the outset that the general principle is that
B a law which brings about a change in the forum does not affect
pending actions unless intention to the contrary is clearly shown.
One of lhe modes by which such an intention is shown is by making
a provision for change-over of proceedings, from the court or the
tribunal where they are pending to the court or the tribunal which
c under the new law gets jurisdiction to try them."
Reference was also made to, Commissioner of Income Tax,
Bangalore v. R. Shradamma, ( 1996) 8 SCC 3 88, and finally, learned
counsel placed reliance on R. Kapilnath v. Krishna, (2003) 1 SCC 444,
wherefrom the Court's attention was drawn to paragraph 4, which is
D extracted below:
"4. The above submission of the learned counsel has been stated
only to be rejected. It is pertinent to note that the proceedings in
the Court ofMunsiff had already stood concluded by the time the
amendment came into force. It is not disputed that Amendment
E Act 32 of 1994 has not been given a retrospective operation and
there is nothing in the Act to infer retrospectivity by necessary
implication. The Act has been specifically brought into force w.e.f.
the 18th day of May, 1994. The learned counsel for the appellant
cited a number of decisions laying down the law as to how an
amendment in legislation brought into force during the pendency
F of legal proceedings has to be given effect to. Without stating the
decisions so cited, suffice it to observe that all those decisions
deal with substantive rights having been created or abolished during
the pendency oflegal proceedings and depending on the legislative
intent and the language employed by the legislature in the relevant
G enactment, this Court has determined the impact of the legislation
on pending proceedings and the power of the court to take note of
change in law and suitably mould the relief consistently with the
legislative changes. So far as the present case is concerned, the
only submission made by the learned counsel for the appellant is
that the effect of the amendment is to deprive the Court ofMunsiff
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 627
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
of its jurisdiction to hear and decide the proceedings for eviction A
over such premises as the suit premises are. In other words, it is
a change in forum brought during the pendency of the proceedings.
The correct approach to be adopted in such cases is that a new
law bringing about a change in forum does not affect pending
actions, unless a pr~vision is made in it for changeover of
B
proceedings or there is some other clear indication that pending
actions are affected. (See Principles of Statutory Interpretation.
Justice G.P. Singh, 8th Edn., 2001, p. 442.l We have already
indicated that the Act does not bring about a change in forum so
far as the pending actions are concerned. Moreover, by the time
the amendment came into force, the proceedings before the Munsiff C
had already stood concluded and the case was pending at the
stage ofrevision before the Additional District Judge. Further, we
find that an objection laying challenge to the forum's competence
was not raised before the learn~d Additional District Judge nor
was the objection taken before the High Court in the civil revision
D
preferred by the appellant. It was not taken as a ground in the
special leave petition. It has been taken only by way of a separate
petition filed subsequently and seeking leave to urge additional
grounds. Such an objection cannot be allowed to be urged so
belatedly. However, we have already held the argument based on
the 1994 Amendment as of no merit." E
27. Learned counsel representing the private parties, in continuation
of the above submission placed reliance on Kamlesh Kumar v. State of
Jharkhand, (2013) 15 sec 460. It was submitted, that the reliance on
the above judgment, was to demonstrate the same position, through a
proposition which was contextually different. It is necessary to record, F
that the instant judgment was also relied upon by learned counsel
representing the SEBI. However, according to learned counsel for the
private parties, it is essential also to take into consideration the
observations recorded in the concurring order passed by Madan B. Lokur,
J. First of all, it is necessary to appreciate the submissions canvassed.
They were recorded (in the opinion relied upon) as under: G
"25. The notification authorising the Special Judge to dispose of
· cases under the Foreign Exchange Management Act, 1999 and
thereby effectively transferring the petitioners' case pending
before the Magistrate to the Special Judge is said to be unlawful
H
628 SUPREME COURT REPORTS [2017] 13 S.C.R.
A since the transfer is to a court that has no jurisdiction to try the
offence.
26. Part II of the First Schedule to the Code of Criminal Procedure,
1973 (for short "the Code") provides that for an offence punishable
with imprisonment for three years and upwards but not more than
B seven years, the case would be triable by a Magistrate of the
First Class. Section 56 of the Foreign Exchange RegylationAct.
1973 (for short "FERA"} now repealed by the Foreign Exchange
Management Act, 1999 provides, inter alia, that for a violation of
its provisions. the.maximum punishment would be imprisonment
which may extend to seven years and with fine. Therefore.
c effectively transferring the petitioners' case to a Special Judge
(of the rank of a Sessions Judge, Additional Sessions Judge or
As-sistant Sessions Judge) functioning under the Criminal Law
Amendment Act. 1952 (for short "the CLA Act") meant its trial
by a court that lacked jurisdiction over the subject-matter. In
D support of this contention, great reliance was placed on some
passages in A.R. Antulay v. R.S. Nayak.
27.2. Secondly, Section 7(1) of the CLAAct provides for trial of
the case by the Special Judge notwithstanding anything contained
in the Code. Therefore, the statutory power available to this <;:ourt
E to transfer cases under Section 406 of the Code was statutorily
taken away. Additionally, Section 406 of the Code only enabled
this Court to transfer cases and appeals from one High Court to
another High Cotirf or from one criminal court subordinate to one
High Court to another criminal court of equal or superior jurisdiction
subordinate to another High Court. Section 406 of the Code did
F not empower this Court to transfer a case from the Special Judge
under the CLA Act to the High Court and even if it did, that
power was taken away by the CLA Act. Section 406 of the Code
reads as follows:
"406. Power of Supreme Court to transfer cases and appeals.-
G ( 1) Whenever it is made to appear to the Supreme Court that an
order under this section is expedient for the ends of justice. it may
direct that any particular case or appeal be transferred from one
High Court to another High Court or from a criminal court
subordinate to one High Court to another criminal court of equal
or superior jurisdiction subordinate to another High Court.
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 629
· • CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
(2) The Supreme Court may act under this section only on the A
application of the Attorney General of India or of a partly interested,
and every such application shall be made by motion, which shall,
except when the applicant is the Attorney General of India or the
Advocate General of the State, be supported by affidavit or
affirmation.
B
(3) Where any application for the exercise of the powers
conferred by this section is dismissed, the Supreme Court may, if
it is of opinion that the application was frivolous or vexatious,
order the applicant to pay by way of compensation to any person
who has opposed the application such sum not exceeding one
thousand rupees as it may consider appropriate in the circumstances
c
of the case."
27.3. The third reason related to the power of transfer available
to this Court under Article 142 of the Constitution. In this context,
reference was made to a Constitution Bench decision of this Court
in Prem Chand Garg v. Excise Commr. wherein it was observed D
that: (AIR p. 1002, para 12)
"12 .... The powers of this Court are no doubt very wide and
they are intended to be and will always be exercised in the interest
of justice. But that is not to say that an order can be made by this
Court which is inconsistent with the fundamental rights guaranteed E
by Part III of the Constitution. An order which this Court can
make in order to do complete justice between the parties. must
not only be consistent with the fundamental rights guaranteed by
the Constitution. but it cannot even be inconsistent with the
substantive provisions of the relevant statutory laws." F
Since the orderofthis Court transferring the case from the Special
Judge to the High Court was contrary to the statutory law and (as
held in a later part in Antulay) contrary to Article 14 and Article
19 of the Constitution, the order of transfer was liable to be set
aside. In this context, this Court also noted that the power to create G
or enlarge jurisdiction is legislative in character and no court,
whether superior or inferior or both combined, could enlarge the
jurisdiction of a court. On this basis. inter alia, this Court concluded
that the transfer of Antulay case from the Special Judge to the
High Court was erroneous in law.
H
630 SUPREME COURT REPORTS [2017] 13 S.C.R.
A 30. It was contended that assuming that at law the case could
validly have been transferred to the Special Judge, the petitioners
are seriously prejudiced inasmuch as their right of appeal from
the decision of a Magistrate to a Sessions Judge is taken away.
Due to this prejudicial action. which was taken by the High Court
without hearing the petitioners. the notification conferring power
B
on the Special Judge to trv the case should be struck down."
Based on the judgments relied upon by learned counsel
representing the private parties, as have been narrated in the foregoing
paragraphs, since the proceedings in the matters in hand were pending,
before the Court of Metropolitan Magistrate (or, the Judicial Magistrate,
c as the case may be), when 'the 2002 Amendment Act' was introduced
with effect from 29. l 0.2002, the pending proceedings could not be
.transferred, to the 'forum' created by 'the 2002 Amendment Act'. In
order to demonstrate prejudice, learned counsel contended, that the right
of the private parties to avail of the remedy ofrevision stood obviated.
D Additionally it was reiterated, that the objects and reasons of the amended
provisions, or the amended provisions themselves, do not indicate any
express or implied determination, that the change of 'forum' would be
retrospective, and would apply to pending matters, as well. And as
such, Section 26E introduced through 'the 2014 Amendment Act', would
determine the 'forum' for fresh matters, i.e., matters where cognizance
E had not been taken till the date of amendment. In order to protect the
proposition being canvassed in the correct perspective and context,
reliance was placed on Shankar Ramchandra Abhyankar v. Krishnaj i
Dattatreya Bapat, (1969) 2 SCC 74, wherefrom, our pointed attention
was drawn to the following observations:
F "5. It would appear that their Lordships of the Privy Council
regarded the revisionaljurisdiction to be a part and parcel of the
appellate jurisdiction of the High Court. This is what was said in
Nagendra Nath Dey v. Suresh Chandra Dey 59 IA 283, 287.
"There is no definition of appeal in the Code of Civil Procedure,
G but their Lordships have no doubt that any application by a party
to an Appellate Court, asking it to set aside or revise a decision of
a subordinate Court, is an appeal within the ordinary acceptation
of the term ......"
Similarly in Raja ofRemnad v. Kamid Rowthen and Others53 IA
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 631
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
74, a civil revision petition was considered to be an appropriate A
form of appeal from the judgment in a suit of small causes nature.
A full Bench of the Madras High Court in P.P.P. Chidambara
Nadar v. C.P.A. Rama Nadar and Others AIR 1937 Mad 385.
had to decide whether with reference to Article 182(2) of the
Limitation Act 1908. the term "appeal" was used in a restrictive B
sense so as to exclude revision petitions and the expression
"appellate court" was to be confined to a court exercising appellate,
as opposed to. revisional powers. After an exhaustive examination
of the case law including the decisions of the Privy Council
mentioned above the full Bench expressed the view that Article
182(2) applied to civil revisions as well and not only to appeals in c
the narrow sense of that terms as used in the Civil Procedure
Code. In Secretary of State for India in Council v. British India
Stearn Navigation Company 13 CLJ 90. an order passed by the
High Court in exercise of its revisional jurisdiction under Section
115. Code of Civil Procedure. was held to be an order made or D
passed in appeal within the meaning of Section 39 of the Latters
Patent. Mookerji. J,, who delivered the judgment of the division
Bench referred to the observations of Lord Westburv in Attorney-
General v. Sillem (1864) 10 RLC 704. and ofSubramania Avvar.
J.. in Chappan v. Moidin (1958) ILR Mad 68. 80. on the true
nature of the right of appeal. Such a right was one of entering a E
superior Court and invoking its aid and interposition redress the
error of the court below. Two things which were required to
constitute appellate jurisdiction were the existence of the relation
of superior and inferior Court and the power on the part of the
former to review decisions of the latter. In the well known work
F
of Story on Constitution (ofUnited States), Vol. 2,Article 1761, it
is stated that the essential criterion of appellate jurisdiction is that
it revises and corrects the proceedings'in a cause already instituted
and does not create that cause. The appellate jurisdiction may be
exercised in a variety of forms and, indeed, in any form in which
the Legislature may choose to prescribe. According to Article G
1762 the most usual modes of exercising appellate jurisdiction, at
least those which are most known in the United States, are by a
writ of error, or by an appeal, or by some process of removal of a
suit from an inferior tribunal. An appeal is a process of civil law
origin and removes a cause, entirely subjecting the fact as well as
H
632 SUPREME COURT REPORTS [2017] 13 S.C.R.
A the law, to a review and a retrial. A writ of error is a process of
common law origin, and it removes nothing for re-examination
but the law. The former mode is usually adopted in cases of equity
and admiralty jurisdiction; the latter, in suits at common law tried
by a jury.
B 6. Now when the aid of the High Court is invoked on the revisional
side it is done because it is a superior court and it can interfere for
the purpose of rectifying the error of the court below. Section 115
of the Code of Civil Procedure circumscribes the limits of that
.@_risdictiop but the jurisdiction which is being exercised is a part
of the general appellate jurisdiction of the High Court as a superior
c court. It is only one of the modes of exercising power conferred
by the statute; basically and fundamentally it is the appellate
jurisdiction of the High Court which is being invoked and exercised
in a wider and larger sense. We do not, therefore, consider that
the principle of merger of orders of inferior courts in those of
D superior Courts would be affected or would become inapplicable
by making a distinction between a petition for revision and an
appeal."
28. While repudiating the submissions advanced by Mr. C.A.
Sundaram, Ms. Pinky Anand, learned Additional Solicitor General of
E India, submitted that as long as the rights of the private parties, to prefer
an appeal stands sustained, none of them can plead prejudice. In this
behalf, reference was made to Section 374(2) of the Code of Criminal
Procedure· to contend, that the accused would not be deprived of any
provision for preferring an appeal, after the 'forum' was altered from
that of the Metropolitan Magistrate (or, Judicial Magistrate of the first
F class), to the Court of Session. It was submitted, that Section 374 of the
Code of Criminal Procedure clearly postulates, that an appeal from the
conviction against trial by the Court of Session or Additional Sessions
Judge, shall lie before the High Court. In this behalf, it was sought to be
pointed out that even after 'the 2002 Amendment Act', upon trial of a
G case by the Court of Session (or, Additional Sessions Judge), an appeal
would lie, before the High Court. It was sought to be highlighted, that
the above position was further clarified in 'the 2014 Amendment Act'
through Section 26C.
29. It was submitted, that the determination of 'forum', based on
the quantum/gravity of the sentence contemplated for an offence, under
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 633
CREDIT LTD. [JAGDISH SINGHKHEHAR, CJI]
'the SEBI Act', as canvassed by learned counsel for the private parties, A
is wholly misconceived. It was submitted, that there was no such
mandate, that for offences where the prescribed punishment was up to
three years, a magisterial trial alone could be held. It was pointed out,
that the punishment contemplated under Section 308 of the Indian Penal
Code was up to three years, but the cases under the said provision was
B
triable by a Court of Session. It was submitted, that the use of the word
"or" in Section 374 of the Code of Criminal Procedure denotes, that the
expressions contl!ined in the provision preceding and subsequent thereto,
were meant to be disjunctive. It was pointed out, that in such a case, by
express proviSion, the High Court has been postulated as the forum of
appeal (under Section 374(2) of the Code of Criminal P"1:ocedure). It c
was also the contention of the learned Additional Solicitor General, that
the appellate remedy is to the High Court, from any order passed by a
Court of Session (or, a Court of Additional Sessions Judge), and from
any order passed by any other court, where the punishment is for a
period in excess of seven years. In order to demonstrate the disjunctive D
character of the above provision, reliance was placed on Devender
v.
Kumar Sii~gla Baldev Krishan Singla, (2005) 9 SCC 15, wherein the
Court observed as under:
"7. In order to appreciate the rival submissions, it would be
necessary to consider on the background of the factual position E.
as to whether offence punishable under Section 420 IPC is made
out. Section 420 deals with certain specified classes of cheating.
It deals with the cases whereby the deceived person is dishonestly
induced to deliver any propertv to any person or to make, alter or
destroy, the whole or any part of a valuable security or anything
which is signed or sealed and which is capable of being converted F
into a·valuable securitv. Section 415 defines "cheating". The said .
provision requires: (i) deception of any person, (ii) whereby
fraudulently or dishonestly inducing that person to deliver any
propertv to any person or to consent that ariy ·person shall retain
any propertv, or (iii) intentionally inducing that person to do or
omit to do anything which he would not do or omit ifhewere not G
so deceived, and which act or omission causes or is likely to cause
damage or harm to that person in bodv, mind reputation or property.
Deception of any person is common to the second and third
requirements of the provision. The said requirements are
H
634 SUPREME COURT REPORTS (2017] 13 S.C.R.
A alternative to each other and this is made significantly clear by
use of disjunctive conjunction "or". The definition of the offence
of cheating embraces some cases in which no transfer of property
is occasioned by the deception and some in which such a transfer
occurs. Deception is the quintessence of the offence. The essential
ingredients to attract Section 420 are: (i) cheating; (ii) dishonest
B
inducement to deliver property or to make, alter or destroy any
valuable security or anything which is sealed or signed or is capable
of being converted into a valuable security; and (iii) the mens rea
of the accused at the time of making the inducement. The making
of a false representation is one of the ingredients for the offence
c of cheating under Section 420. (See Bashirbhai Mohamedbhai v.
State of Bombay AIR 1960 SC 979.)"
Based on the observations extracted above, it was submitted, that
inference sought to be drawn by learned counsel representing private
parties, that in determining 'forum' it is essential to take into consideration
D the length of the punishment, contemplated underthe provision violated,
was nothing but a figment of imagination of learned counsel for the
private parties. It was also contended on behalf of SEBI, that the
availability ofa revisionaljurisdiction to assail an order has never been
accepted as a vested right. In this behalf, reliance was placed on a
judgment rendered by a Constitution Bench in Pranab Kumar Mitra v.
E State of West Bengal, AIR 1959 SC 144, wherein it was held as under:
"6. In our opinion, in the absence of statutory provisions, in terms
applying to an application in revision, as there are those in S. 431
in respect of criminal appeals, the High Court has the power to
pass such orders as to it may seem fit and proper. in exercise of
F its revisional jurisdiction vested in it by S. 439 of the Code. Indeed.
it is a discretionarv power which has to be exercised in aid of
justice. Whether or not the High Court will exercise its revisional
jurisdiction in a given case. must depend upon the facts and
circumstances of that case. The revisional powers of the High
G Court vested in it by S. 439 of the Code. read with S. 435. do not
create any right in the litigant. but only conserve the power of the
High Court to see that justice is done in accordance with the
recognized rules of criminal jurisprudence. and that subordinate
Criminal Courts do not exceed their jurisdiction. or abuse their
powers vested in them by the Code. On the other hand. as already
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 635
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI)
indicated. a right of appeal is a statutory right which has got to be A
recognized by the courts. and the right to appeal, where one exists.
cannot be denied in exercise of the discretionary power even of
the High Court. The Legislature has, therefore, specifically
provided, by S. 431 of the Code, the rules governing the right of
substitution in case of death of an appellant, but there is no B
corresponding provision in Chapter XXXII, dealing with the question
of abatement and the right of substitution in a criminal revision.
We may assume that the Legislature was aware of the decision
of the Bombay High Court, referred to above, when it enacted S.
431 for the first time in the Code of 1882. If the Legislature
intended that an application in revision pending in a High Court. c
should be dealt with on the same footing as a pending appeal. it
would have enacted accordingly. But in the absence of any such
enactment. we may infer that the power of revision vested in the
High Court under Chapter XXXII of the Code. was left untouched
- to be exercised according to the exigencies of each case. The D
High Court is not bound to entertain an application in revision. or
having entertained one. to order substitution in· every case. It is
not bound the other wav. namely. to treat a pending aoolication in
revision as having abated by reason of the fact that there was a
composite sentence of imprisonment and fine. as some of the
Single Judge decisions placed before us. would seem to indicate. E
The High Court has been left complete discretion to deal with a
pending matter on the death of the petitioner in accordance with
the requirements of justice. The petitioner in the High Court may
have been an accused person who has been convicted and
sentenced, or he may have been a complainant who may have
F
been directed under S. 250 of the Code to pay compensation to
an accused person upon his discharge or acquittal. Whether it
was .an accused person or it was a complainant who has moved
the High Court in its revisional jurisdiction, if the High Court has
issued a Rule, that Rule has to be heard and determined in
accordance with law, whether or not the petitioner in the High G
Court is alive or dead, or whether he is represented in Court.by a
legal practitioner. In hearing and determining cases under S. 439
of the Code. the High Court discharges its statutory function of
supervising the administration ofiustice on the criminal side. Hence.
the considerations applying to abatement of an appeal. may not
H
636 SUPREME COURT REPORTS [2017] 13 S.C.R.
A apply to the case ofrevisional aoolications. ln our opinion, therefore,
the Bombay majority decision, in the absence of any statutory
provisions in respect of criminal revisional cases, lays down the
correct approach."
For the same proposition, reliance was also placed on Kamlesh
B Kwnarv. State ofJharkhand, (2013) 15 SCC 460, and the Court's attention
was drawn to the following observations:O
"41. This question proceeds on the assumption that there is a right
of revision. A Constitution Bench of this Court in Pranab Kumar
Mitra v. State ofW.B. set the "right" issue at rest several decades
ago. It was held that the power to revise an order is a discretionarv
power which is to be exercised in aid of justice and the exercise
of that power will depend on the facts and circumstances of a
given case. It was held: (AIR p. 147, para 6)
"6.... The revisional powers of the High Court vested in it by
Section 439 of the Code read with Section 435, do not create any
D
right in the litigant, but only conserve the power of the High Court
to see that justice is done in accordance with the recognised rules
of criminal jurisprudence. and that subordinate criminal courts do
not exceed their jurisdiction. or abuse their powers vested in them
by the Code."
E 43. While the revisional power ofa superior court actually enables
. it to correct a grave error. the existence of that power does not
confer any corresponding right on a litigant. This is the reason
why. in a given case, a superior court may decline to exercise its
power of revision, if the facts and circumstances of the case do
F not warrant the exercise of its discretion. This is also the reason
why it is felicitously stated that a revision is not a right but only a
"procedural facility" available to a party. If the matter is looked at
in this light, the transfer of a case from a Magistrate to a Special
Judge does not take away this procedural facility available to the
petitioners. It only changes the forum and as already held above,
G the petitioners have no right to choose the forum in which to file
an appeal or move a petition for revising an interlocutory order."
It was accordingly the contention of learned counsel for SEBI,
for the accused cannot make out any grievance to the effect that the
change of 'forum', in the facts and circumstances of the present case,
H has adversely affected their vested right.
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 637
CREDIT LTD. [JAGDISH SINGH KHEHAR, CH]
30. lt was also highlighted by the Additional Solicitor General, that A
prior to 'the 2002 Amendment Act', the postulated punishment under
Section 24(1) of 'the SEBI Act', extended to one year of sentence and
fine, or both; and under Section 24(2) thereof, the prescribed punishment
was a minimum of one month, which could extend to three years or with
fine, which would not be less than rupees two thousand, but not more B
than rupees ten thousand, or with both. It was pointed out, that even at
that juncture, the 'forum' .of trial under Sections 24( 1) and 24(2) of 'the
SEBI Act' was the same, namely, "No court inferior to that of a
Metropolitan Magistrate or a Judicial Magistrate of the first class shall
try an offence punishable under this Act". It was submitted, that after
'the 2002 Amendment Act'," ... no court inferior to the Court of Session C
shall try any offence punishable under this Act ..." In the above view of
the matter, it was submitted, that the entire cop.tention advanced at the
hands of learned counsel representing the private parties, was
misconceived.
31. In addition to the submissions noticed in the foregoing D
paragraphs, learned Additional Solicitor General contended, that the
legislative intent in 'the.2002 Amendment Act', as well as, 'the 2014
Amendment Act' was clear. It was submitted, that by 'the 2002
Amendment Act' the statutory legislation took away the right of courts
inferior to the Court of Session from trying offences punishable under
'the SEBIAct'. Emphasis was placed by lea~ed counsel ori the poinreti E
indication in the provision, to" ... offences punishable under this Act." It
was therefore asserted, that the above amendment especially denuded
the jurisdiction of courts inferior to the Court of Session, to try offences
punishable under the Special Act. The above contention was sought to
be reiterated by assailing, that trial before any court inferior to the Court F
of Session, after 'the2002 Amendment Act', would be ex facie without
jurisdiction. For supporting the aforesaid contention, learned counsel
also emphasized on the use of the words "no court inferior to" and the
word "shall" in Section 26(2) of 'the 2002 Amendment Ad', to highlight
that jurisdiction of all other inferior courts was taken away. In order to
support the aforesaid contention, learned counsel placed reliance on Union G
of India v. A.K. Pandey, (2009) 10 SCC 552, wherein reference was
pointedly made to the following observations:
"15. The principle seems to be fairly well settled ihat prohibitive
,
or negative words are ordinarily indicative of mandatory nature
H.
638 SUPREME COURT REPORTS (2017] 13 S.C.R.
A of the provision; although not conclusive. The Court has to examine
carefully the purpose of such provision and the consequences
that may follow from non-observance thereof. If the context does
not show nor demands otherwise, the text of a statutory provision
couched in a negative form ordinarily has to be read in the form
of command. When the word "shall" is followed by prohibitive or
B
negative words, the legislative intention of making the provision
absolute, peremptory and imperative becomes loud and clear and
ordinarily has to be inferred as such. There being nothing in the
context otherwise, in our judgment, there has to be clear ninety-
six hours' interval between the accused being charged for which
c he is to be tried and his arraignment and interval time in Rule 34
must be read as absolute. There is a purpose behind this provision:
that purpose is that before the accused is called upon for trial, he
must be given adequate time to give a cool thought to the charge
or charges for which he is to be tried, decide about his defence
and ask the authorities, if necessary, to take reasonable steps in
D
procuring the attendance of his witnesses. He may even decide
not to defend the charge(s) but before he decides his line of action,
he must be given clear ninety-six hours."
And, on the subject in hand, reference was made to Mannalal
Khetan v. Kedar Nath Khetan, ( 1977) 2 SCC 424, wherefrom the Court's
E attention was drawn to the following observations:
17. In Raza Buland Sugar Co. Ltd. v. Municipal Board, Rampur
this Court referred to various tests for finding out when a provision
is mandatory or directory. The purpose for which the provision
has been made, its nature, the intention of the legislature in making
F the provision, the general inconvenience or injustice which may
result to the person from reading the provision one way or the
other, the relation of the particular provision to other provisions
dealing with the same subject and the language of the provision
are all to be considered. Prohibition and negative words can rarely
G be directory. It has been aptly stated that there is one way to obey
the command and that is completely to refrain from doing the
forbidden act. Therefore, negative, prohibitory and exclusive words
are indicative of the legislative intent when the statute is mandatory.
(See Maxwell on Interpretation of Statutes, 11th Edn., p. 362 seq.;
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 639
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
Crawford: Statutory Construction, Interpretation of Laws, p. 523 A
and Seth Bikhrai Jaipuria v. Union of India.)"
32. We have given our thoughtful consideration to the submissions
advanced by Ms. Pinky Anand, learned Additional Solicitor General of
India, in support of the conclusions drawn by the Delhi High Court in
Mahender Singh v. High Court of Delhi (Writ Petition (C) No.141 of B
2007, decided on I I .0 I .2008) and to oppose the view expressed by the
Bombay High Court in Mis. Classic Credit Ltd. v. State of Maharashtra
(Criminal Application No.1557 of2007, decided on 16.01.2008). We
have also considered the converse stance, raised by Mr. C.A. Sundaram,
learned Senior Advocate representing most of the private parties.
c
33. In a manner of understanding, it may well be possible to
conclude, that the adjudicatory 'forum' was not altered at all by 'the
2002 Amendment Act'. In this behalf, reference may be made to Section
26(2) of 'the SEB!Act', as it existed prior to the 2002 amendment. The
above provisions mandated, that no Court inferior to that of a Metropolitan
Magistrate (or, a Judicial Magistrate of the first class) shall try an offence D
punishable under this Act. The contemplated 'forum' of adjudication
could be the Court of a Metropolitan Magistrate (or, a Judicial Magistrate
of the first class), or any other higher court. And not necessarily the
Court of a Metropolitan Magistrate (or, a Judicial Magistrate of the first
class). The higher court which could have tried matters even before E
'the 2002 Amendment Act', could well be the Court of Session. And as
such, in case of a determination, the trial of offences under 'the SEBI
Act' could have been conducted by a Court of Session even prior to 'the
2002 Amendment Act', there would be nothing wrong about it. The
provision, as it existed prior to 'the 2002 Amendment Act', clearly
contemplated that even a Court of Session could try offences postulated F
by the provisions of 'the SEBI Act'. As such, when 'the 2002
Amendment Act' provided that adjudication of offences under 'the SEBI
Act' would be by a court not inferior to that of a Court of Session, the
position postulated prior to the aforesaid amendment cannot be stated to
have been breached. It may well be said to be curtailed from the original G
position. But, it could not be said to be in conflict with the original position.
In a similar manner of understanding, even after 'the 2014 Amendment
Act', which provided that offences arising under 'the SEB!Act' would
be tried by a Special Court (- Section 26B), the position cannot be tak~n
to be at variance from the one, as it existed prior to the 2002 amendment,
H
640 SUPREME COURT REPORTS [2017] 13 S.C.R.
A as also, the position as it existed after 'the 2002 Amendment Act'. The
reason for the above inference is, that a Special Court (notified by the
Central Government) was to be a court which, immediately before such
notification, was the Court of Session or an Additional Sessions Judge (-
Section 26A(3)). Truly therefore, a Special Court was a court superior
to a Metropolitan Magistrate (or, a Judicial Magistrate of the first class),
B
as contemplated prior to 'the 2002 Arnen~ent Act'. It was also the
same as the court contemplated under 'the 2002 Amendment Ac.t',
namely, the Court of Session. Therefore, the projection ofthe jurisdictional
claim, as has been raised by the accused herein, is a mere furore, without
any serious justification.
c 34. We will now deal with the legality of the propositions canvassed,
at the hands oflearned counsel for the rival parties. In our considered
view, the legal position expounded by this Court in a large number of
judgments including New India Insurance Co. Ltd. v. Shanti Misra, (1975)
2 SCC 840; Securities and Exchange Board of India v. Ajay Agarwal,
D (2010) 3 SCC 765; and Ramesh Kumar Soni v. State of Madhya Pradesh,
(2013) 4 sec 696, is clear ~nd unambiguous, namely, that procedural
amendments are presumed to be retrospective in nature, unless the
amending statute expressly or impliedly provides otherwise. And also,
that generally change of 'forum' of trial is procedural, and normally
following the.. above proposition, it is presumed to be retrospective in
E nature, unless the amending statute provides otherwise. This
determination emerges from the decision of this Court in Hitendra Vishnu
Thakur v. State of Maharashtra ( 1994) 4 SCC 602; Ranbir Yadav v.
State of Bihar ( 1995) 4 SCC 392, and Kamlesh Kumar v. State of
Jharkhand, (2013) 15 sec 460, as well as, a numberof further judgments
F noted above.
35. We have also no doubt, that alteration of 'forum' has been
considered to be procedural, and that, we have no hesitation in accepting
the contention advanced on behalf of the SEBI, that change of 'forum'
being procedural, the amendment of the 'forum' would operate
G retrospectively, irrespective of whether the offence allegedly committed
by the accused, was committed prior to the amendment.
36. Whilst accepting the contentions advanced on behalf ofleamed
counsel for SEBI pertaining to 'forum' (with reference to which
inferences have been drawn in the foregoing paragraph), it is not possible
for us to outrightly reject the contentions advanced by Mr. C.A.
H
SECURITIES AND EXCHANGE.BOARD OF INDIA v. CLASSIC 641
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
Sundaram, learned Senior Advocate, while projecting the claim of the A
accused. We are not oblivious of the conclusions recorded by this Court
in Commissioner of Income Tax, Orissa v. Dhadi Sahu, 1994 Supp ( 1)
sec 257, wherein it was held that a law which brings about a change in
the 'forum' does not affect pending actions, unless an intention to the
contrary is clearly shown. One of the modes in which such intentions
B
can be shown is, by making a provision for change for a proceeding
from the court or the tribunal where it was pending, to the court or
tribunal under which the new law gets jurisdiction. In the said judgment,
this Court also observed, that it was true that no litigant had any vested
right in the matter of procedural law, but where the question is of the
change of 'forum', it ceases to be a question of procedure only, with c
reference to pending matter. The 'forum' of appeal or proceedings, it
was held, was a vested right as opposed to pure procedure to be followed
before a particular 'forum'. It was therefore concluded, that a right
becomes vested when the proceedings are initiated, in spite of change
of jurisdiction/forum by way of amendment thereafter. So also, in
D
Manujendra Dutt v. Pumedu Prosad Roy Chowsdhury, AIR 1967 SC
1419, wherein a question arose, as to whether, by the deletion of Section
29 of the Thikka Tenancy Act, 1949, the jurisdiction of the Controller
over a pending suit was taken away. It was held by this Court, that the
deletion of Section 29 did not deprive the Controller of his jurisdiction to
try the pending suit, on the date when the Amending Act came into E
force. It was pointed out, that though the amending Act did not contain
a saving clause, the saving contained in Section 8 of the Bengal General
Clauses Act, 1899, which corresponded with Section 6 of the Central
Act, fully applied to the issue. And as such, the transfer of a suit having
been lawfully filed under Section 29 of the Act could not be affected by
F
its deletion or by its amendment. Similarly, in Mohd. Idris v. Sat Narain,
AIR 1966 SC 1499, the question which arose was, whether a Munsif
who was trying a suit under the U .P. Agriculturist Relief Act ceased to
have jurisdiction, after the passing of the U.P. Zamindari Abolition and
Amendment Act, 1953, which conferred jurisdiction on an Assistant
Collector. This Court held that the jurisdiction of the Assistant Collector G
was itself created by the Abolition Act, and as there was no provision in
that Act, that the pending case were to stand transferred to the Assistant
Collector for disposal, the Munsif continued to have jurisdiction to try
the suit. It was also observed in the above judgment, that the provisions
for change over of proceedings from one court to another, are only found
H
642 SUPREME COURT REPORTS [2017] 13 S.C.R.
A in a statute, which takes away the jurisdiction of one court, and confers
it on another, in pending actions. Since the amending Act did not show
the pending proceedings before the court would abate, it was felt, that
the court before which proceedings were filed, continued to have the
jurisdiction to adjudicate the same. The above position has been
considered atllrmatively by this Court also in Nani Gopal Mittal v. State
B
of Bihar, AIR 1970 SC 1636; Ambalal Sarabhai Enterprises v. Amrit Lal
and Cu .. (2001) 8 SCC 397; R. Kapilnath v. Krishna, (2003) I sec 444;
Ramesh Kumar Soni v. State of Madhya Pradesh, (2013) 14 SCC 696;
and Videucun International Limited v. Securities and Exchange Board
of India, (2015) 4 sec 33. From a perusal of the conclusions drawn in
c lhe above judgments, we are inclined to accept the contention, that change
of 'forum' could be substantive or procedural. It may well be procedural
when the remedy was yet to be availed of, but where the remedy had
already been availed of(under an existing statutory provision), the right
may be treated as having crystalised into a vested substantive right.
D 37. In the latter situation referred to (and debated) in the preceding
paragraph, where the remedy had been availed of prior to the amendment,
even according to learned counsel for the private parties, unless the
amending provision by express words, or by necessary implication,
mandates the transfer of proceedings to the 'forum' introduced by the
amendment. the 'forum' postulated by the unamended provision, would
E continue to have the jurisdiction to adjudicate upon pending matters
(matters tiled before amendment). In view of the above, we are of the
considered view, that no vested right can be claimed with reference to
'forum', where the concerned court, had not taken cognizance and
commenced trial proceedings, in consonance with the unamended
F prov1s10n.
38. Insofar as the matters where proceedings had already
commenced before the amendment, change of 'forum' for trial came
into effoct, it is apparent from the judgments referred to in the preceding
paragraph, that the general principle is that a law which brings about a
change in the 'forum', does not affect pending actions, unless intention
G
to the contrary is clearly shown. What needs to be determined with
reference to 'the 2002 Amendment Act', as well as, with reference to
'the 2014 Amendment Act' is, whether an intention to the contrary was
expressed therein, so as to alter the 'forum', where proceedings were
pending. And to bring such proceedings to the 'forum' contemplated by
H the amendment.
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 643
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
39. Having given our thoughtful consideration to the proposition A
referred to in the preceding paragraph, we are of the view, that Section
26, as amended through 'the 2002Amendment Act', leaves no room for
any doubt, that the erstwhile 'forum' would cease to be the adjudicatory
authority and the newly created 'forum' - the Court of Session, would
deal with all pending matters as well. The phrase, "No court inferior to
B
that of a court of session shall try any offence punishable under this
Act", leaves no room for any doubt, that the erstwhile 'forum' - the
Court of Metropolitan Magistrate (or, Judicial Magistrate of the first
class), was denuded of its jurisdiction. The court having jurisdiction
earlier, being a court inferior to a Court of Session ceased to have the
jurisdiction to adjudicate matters punishable under 'the SEBIAct', after c
the amendment under 'the 2002 Amendment Act' came into force, on
29.10.2002. There can be no doubt whatsoever, that 'the 2002
Amendment Act', expressly diverted jurisdiction from the Metropolitan
Magistrates (and, Judicial Magistrates of the first class) to try offences
under 'the SEBI Act', after 'the 2002 Amendment Act' became
D
operational.
40. The position was similarly explicit in Section 26B inserted by
'the 2014 Amendment Act', by use of the words" ... all offences under
this Act committed prior to the date of commencement of the Securities
Laws (Amendment) Act, 2014 or on or after the date of such
E
commencement, shall be ... tried by the Special Court established for
the area in which the offence is committed ... ". There can be no doubt
whatsoever, that 'the 2014 Amendment Act' grouped all offences together
as one, by providing that all offences committed prior to or after 'the
2014AmendmentAct', would be tried by a Special Court. The attempt
of the learned Senior Advocate, to segregate the cases arising under F
'the SEBIAct' into two categories, is clearly and expressly ruled out, by
the language adopted in the provision itself. We are of the view, that
Section 26B was categorically explicit, because of the clear intent
expressed therein, that all offences committed under 'the SEBI Act',
prior to the introduction of'the 2014AmendmentAct', would be tried by
G
the Special Court. We are therefore of the view, that there is absolutely
no ambiguity, that after 'the 2014 Amendment Act', proceedings in respect
of offences committed prior thereto, could only be tried by a Special
Court.
H
644 SUPREME COURT REPORTS [2017] 13 S.C.R.
A 41. We have intentionally overlooked and not extracted the words
" ... shall be taken cognizance of and tried by the Special Court ... ",
relied upon by learned counsel for the accused, to emphasise that the
amendment of 'forum' contemplated under Section 16B would be
applicable only to matters where cognizance had not been taken. It is
not possible, either from the language of the provision, or even from the
B
surrounding circumstances, to arrive at the advocated position. We are
of the view, that the legislative intent was clearly contrary to the one
suggested. Ordinarily, cognizance is taken by a magisterial court,
whereupon, the matter is committed to the concerned higher court, for
trial. Herein, the Special Courts (a Court of Session or an Additional
c Sessions Judge, in terms of Section 26D(l) of 'the 2014 Amendment
Act') provides for a position different from the provisions contained in
the Code of Criminal Procedure. Now, by 'the 2014 Amendment Act',
the function of taking cognizance has been vested with Special Court,
conferred with the responsibility to conduct trials. In our considered
view, therefore, all pending matters where cognizance had been taken
D
and proceedings had commenced, before the Court of Session, would
not be affected. 'The 2014 Amendment Act' which provided for a
change of 'forum', also authorized a Special Court to take cognizance.
It is not reasonable to read anything further into the words highlighted by
learned senior counsel. 'The 2014 Amendment Act' expressly provided,
E that for all offences committed even prior to 'the 2014 Amendment Act,
proceedings would be conducted only before the Special Court. The
provision itself therefore expressly mandated, that the change of'forum'
would operate retrospectively, and as such, pending proceedings would
necessarily have to be transferred to the changed 'forum' -the Special
Cotlrt. This is our considered view. For the reasons recorded above,
F
we hereby hold, that even for such matters where trial had commenced
under the unamended provision, after the amendments, which we have
held to be operational retrospectively, the trial would move to the changed
'forum' (to the Court of Session, after 'the 2002 Amendment Act' and,
to the Special Court, after 'the 2014 Amendment Act').
G 42. We shall now endeavour to attempt to record the submission
advanced by Mr. D.P. Singh, Advocate, who also represented the
accused. The first contention advanced by learned counsel was simple
and straightforward. It was submitted, that transfer of jurisdiction,
consequent upon 'the 2002 Amendment Act', from the Court of a
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 645
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
Metropolitan Magistrate (or, a Judicial Magistrate of the first class), to a A
Court of Session, would seriously prejudice the accused represented by
him. It was his contention, that after the amendment of Sections 24 and
26 by 'the 2002 Amendment Act', the punishment for offences committed
under 'the SEBI Act' were enhanced to the extent, that the same could
no longer be tried as summons-cases. It was pointed out, that the trial of B
cases after 'the 2002 Amendment Act', could only be as warrant-cases.
In this behalf, it was sought to be asserted, that under Section 2(x) of the
Code of Criminal Procedure, a warrant-case is a case" ... relating to an
offence punishable with death, imprisonment for life or imprisonment
for a term exceeding two years''. In conjunction with the definition of
warrant-cases, learned counsel placed reliance on the definition of C
summons cases by inviting the attention of the Court to Section 2(w),
wherein a summons case is defined as a case" ... relating to an offence, (
and not being a warrant-case". During the course of the instant
submission, learned counsel inter alia invited our attention to Section 4
of the Code of Criminal Procedure, which deals with trial of offences
D
under the Indian Penal Code and other laws, so as to conclude, that for
offences punishable with imprisonment for more than seven years, the
trial is liable to be conducted by a Court of Session. In this behalf, the
pointed attention of this Court was also drawn to Schedule I, Part II
appended to the Code of Criminal Procedure, which comprises of
classification of offences from other laws (other than the Indian Penal E
Code). It was pointed out, that 'the SEBIAct' satisfies the category of
"other laws'', and therefore, for an offence punishable with imprisonment
for more than seven years, the trial can only be by a Court of Session. It
was submitted, that where the contemplated punishment was for three
years and upwards (though less than seven years), the trial had to be
F
conducted by a Magistrate of the first class. Again making a reference
to the Part II of the First Schedule (appended to the Code of Criminal
Procedure), it was submitted, that ifthe punishment contemplated was
of imprisonment for less than three years, or with fine alone, the trial
could be conducted by any Magistrate. It was submitted, that the
provisions of Sections 24 and 26 of 'the SEBI Act', prior to 'the 2002 G
Amendment Act', were drawn in consonance with Part II of the First
Schedule, appended to the Code of Criminal Procedure, and as such,
trial had necessarily to be conducted by a Metropolitan Magistrate (or, a
Judicial Magistrate of the first class). '
H
646 SUPREME COURT REPORTS [2017] 13 S.C.R.
A 43. In order to demonstrate prejudice, learned counsel in the first
instance, invited the Court's attention to Section 260 of the Code of
Criminal Procedure, and in conjunction thereto, to Section 262 thereof
The aforestated provisions are being extracted hereunder:
"260. Power to try summarily. -( 1) Notwithstanding anything
B contained in this Code
(a) any Chief Judicial Magistrate;
(b) any Metropolitan Magistrate;
( c) any Magistrate of the first class specially empowered in this
c behalf by the High Court,
may, if he thinks fit, try in a summary way all or any of the following
offences:
(i) offences not punishable with death, imprisonment for life or
imprisonment for a term exceeding two years;
D
(ii) theft, under section 379, section 380 or section 381 of the Indian
Penal Code, 1860 (45of1860), where the value of the property
stolen does not exceed two thousand rupees;
(iii) receiving or retaining stolen property, under section 411 of
the Indian Penal Code, 1860 (45of1860), where the value of the
E
property does not exceed two thousand rupees;
(iv) assisting in the concealment or disposal of stolen property,
under section 414 of the Indian Penal Code, 1860 (45 of 1860)
where the value of such property does not exceed two thousand
rupees;
F
(v) offences under sections 454 and 456 ot the Indian Penal Code,
1860 (45 of 1860);
(vi) insult with intent to provoke a breach of the peace, under
section 504 and criminal intimidation punishable with imprbu11111cJ1t
G for a term which may extend to two years, or with fine, or \\'ith
both, under section 506 of the Indian Penal Cude, 1S60 (4" of
1860);
(vii) abetment of any of the foregoing offences;
(viii) an attempt to commit any of the foregoing offences. when
H such attempt is an offence;
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 647
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!)
(ix) any offence constituted by an act in respect of which a A
complaint may be made under section 20 of the Cattle-trespass
Act, 1871 (1of1871).
(2) When, in the course of a summary trial it appears to the
Magistrate that the nature of the case is such that it is undesirable
to try it summarily, the Magistrate shall recall any witnesses who B
may have been examined and proceed to re-hear, the case in the
manner provided by this Code.
xxx xxx xxx
262. Procedure for summary trials. -( l) In trials under this Chapter, c
the procedure specified in this Code for the trial of summons-
case shall be followed except as hereinafter mentioned.
(2) No sentence of imprisonment for a term exceeding three
months shall be passed in the case of any conviction under this
Chapter." D
Relying upon sub-section (l) of Section 260, it was contended,
that it was open to the Metropolitan Magistrate (or, Judicial Magistrate
of the first class), to try the accused under the 'the SEB!Act', by holding
a summary trial. In case, the Metropolitan Magistrate (or, Judicial
Magistrate of the first class), exercises his discretion to try an accused E
by holding a summary trial, the Metropolitan Magistrate (or, Judicial
Magistrate, as the case may be), could not impose a sentence in excess
of three months. It was contended, that the above right which was vested
in the accused, stands taken away by 'the 2002 Amendment Act' on
account of change of 'forum'. So also, by 'the 2014 Amendment Act'. F
It was pointed out, that in the above view of the matter the change of
'forum' - contemplated through 'the 2002 Amendment Act', could not
be considered as having mere procedural implications, but must also be
deemed to have substantive implications. It was submitted, that the
adoption of the process of summary trial, is only vested with Chief Judicial
Magistrates, Metropolitan Magistrates, or Magistrates of the first class. G
Consequent upon the change of 'forum', to that of the Court of Session,
it was asserted, the possibility of adjudication of the accused by holding
a summary trial has been taken away. And therefore, the possibility of
being let off with a light sentence of three months, has also been taken
H
648 SUPREME COURT REPORTS [2017] 13 S.C.R.
A away. It was submitted, that the instant right vested in the accused
under the unamended provisions of Sections 24 and 26 of 'the SEBI
Act' could not have been taken away retrospectively. It was pointed
out, that after 'the 2002 Amendment Act', the accused cannot insist, in
case he is found guilty, that the sentence imposed upon them should be
limited to three months.
B
44. It was the emphatic contention of learned counsel for the
accused, that irrespective of the submissions advanced on behalf of the
accused, as have been canvassed by other learned counsel, if it could be
shown that the chainge of'fornm' of trial, was discriminatory or prejudicial
or created a disability or disadvantage or fastened an obligation, not
c arising in the 'forum' of trial prior to the amendment, the change of
'forum' would have to be prospective. In this behalf, reliance was placed
on Union of India v. Sukumar Pyne, AIR 1966 SC 1206; Nani Gopal
Mitra v. State of Bihar, AIR 1970 SC 1636; New India Insurance Co.
Ltd. v. Shanti Misra (1975) 2 SCC 840; Hitendra Vishnu Thakurv. State
D of Maharashtra (l 994) 4 sec 602; Ranbir Yadav V. State ofBihar (1995)
4 SCC 392, and Kamlesh Kumar v. State ofJharkhand, (2013) 15 SCC
460. We are of the view, that the legal proposition canvassed, has been
correctly advanced. The question however is, whether it can be applied
to the instant case, based on the submissions recorded in the foregoing
paragraph.
E
45. Learned Additional Solicitor General, vehemently contested
the above submissions. It was pointed out, that prior to amendment in
'the SEBI Act' with effect from 29.10.2002, the punishment prescribed
was as under:
F (a) Section 24(1) of 'the SEBI Act' imprisonment was for a term
which may extend to one year, or with fine or both,
(b) Section 24(2) of the SEBI Act imprisonment was for a term
which may extend to three years or with fine which shall not be less
than two thousand rnpees but which may extend to ten thousand or with
G both.
It was highlighted, that Section 2(x) of the Code of Criminal
Procedure defines a 'warrant case', as a case relating to an offence
punishable with death, imprisonment for life or imprisonment for a term
exceeding two years. Section 2(w) of the Code of Criminal Procedure
defines a 'summons case', as a case relating to an offence, and not
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 649
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
being a warrant case. It was submitted, that all offences would either A
be tried under Chapter XIX of the Code of Criminal Procedure as 'warrant
cases' or under Chapter XX as 'summons cases' in view of the quantum
of maximum imprisonment prescribed (of three years and one year
respectively). The 'forum' of trial for both the aforesaid was the same.
It was sought to be emphasized, that Section 260 of the Code of Criminal B
Procedure is not in Chapter XIX or XX but under Chapter XXI. The
application of Section 260 according to the learned Additional Solicitor
General, is discretionary, and no right is vested in the acused to be tried
summarily. And therefore, no right is vested in an accused to claim a
summary trial. Furthermore, Section 262(2), according to learned
Additional Solicitor General, provides that 'no sentence ofimprisonment C
for a term exceeding three months shall be passed in the case of any
.conviction under the chapter. Therefore, the discretion of a Magistrate
cannot prevail over the unambiguous and clear special Statute, i.e., 'the
SEBI Act', wherein, the punishment prescribed is one year or three
years (in the case of the pre-amendment, of Section 24(1) and 24(2) of D
'the SEBI Act'.
46. Moreover it was submitted, that in 'the SEBI Act', there is no
provision of summary trial of the cases. The legislative intent, is therefore
very clear. Wherever the legislature had envisaged summary trial of
cases, the legislature has made specific provision for the same, in the
enactment itself. Under the Negotiable Instrument Act, the legislature E
had provided under Section 143 of the Negotiable Instruments Act, 1881.
Similar provisions were also provided for under Section l 6A of the Food
Adulteration Act, 1954. It was accordingly asserted, that under special
enactments, whenever the legislature desired the offences to be tried
summarily, it provided so expressly. But, no such provision has expressly F
been enacted under 'the SEBI Act'. There was no expression in either
the pre-amendment or the post-amendment legislation, of any legislative
intent of the trial proceeds, before different forums for violations of the
different provisions of Section 24(1) and 24(2) of'the SEBIAct'. As
'the SEBIAct' had provided different punishment under Sections 24(1)
and 24(2), for trial before the same 'forum', the plea raised by learned G
counsel for the accused, cannot be accepted.
47. Furthermore, it was pointed out, that the trial under Chapter
XIX is for warrant cases (starting from Section 238 to 250). Chapter
1
XX is for Summons Case (starting from Sections 251 to 259). Both
H
650 SUPREME COURT REPORTS [2017] 13 S.C.R.
A these chapters are very exhaustive in nature, and prescribe complete
procedure in itself, and provided sufficient protections. Provisions for
summary trial, on the other hand, are in Chapter XX!. Further, summary
trial is at the discretion of the magistrate and cannot be sought as a
matterofright. The language of Section 260(1) is" ... may, ifhe thinks
fit, try in a summary way ... ". The language of section is crystal clear.
B
Section 260(2) even provides, that the magistrate can try the case in the
regular manner even after deciding to proceed summarily, at any ti111e, if
he finds during the course of summary trial, that the nature of the case is
such, that it is undesirable to try it summarily. It was accordingly asserted,
that the accused under 'the SEB!Act', do not have any right to a summary
c trial, leave alone a valuable right.
48. Whilst dealing with the first contention advanced by Mr. D.P.
Singh, Advocate, it is imperative to deal with some of the salient features,
which need be kept in mind. Section 26(b) of the Code of Criminal
Procedure, deals with offences under legislative enactments other than
D the Indian Penal Code. This is how Section 26(b) contrasts with Section
26(a) of the Code. Section 26 of the Code of Criminal Procedure is
reproduced below:
"26. Courts by which offences are triable. Subject to the other
provisions of this Code,-
E (a) any offence under the Indian Penal Code (45of1860 ), may
be tried by-
(i) the High Court, or
(ii) the Court of Session, or
F (iii) any other Court by which such offence is shown in the First
Schedule to be triable;
Provided that any offence under section 376, section 376A, section
376B, section 376C, section 3760 or section 376E of the Indian
Penal Code (45of1860) shall be tried as far as practicable by a
G Court presided over by a woman.
(b) any offence under any other law shall, when any Court is
mentioned in this behalf in such law, be tried by such Court and
when no Court is so mentioned, may be tried by-
(i) the High Court, or
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 651
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
(ii) any other Court by which such offence is shown in the First A
Schedule to be triable."
Under 'the SEBI Act', the court postulated for adjudication of
offences committed under 'the SEBIAct', prior to 'the 2002Amendment
Act', was a court not inferior to that of a Court of the Metropolitan
Magistrate (or, a Judicial Magistrate of the first class). It is therefore B
apparent, that the 'forum' for trial, which would adjudicate offences
under 'the SEBI Act', emerged from the substantive enactment itself (-
'the SEBI Act'). As such, reference for purposes of offences under
'the SEB!Act' to the provisions of the Code of Criminal Procedure, for
the matter ofjurisdiction, is wholly misconceived.
c
49. It is also essential, to make a reference to Part II of the Second
Schedule to the Code of Criminal Procedure. The same is extracted
hereunder:
"II - CLASSIFICATION OF OFFENCES AGAINST OTHER
LAWS D
Offeoce CogniZBble or Bailable or ' By \\bat crurt
non-cogpizable rxm-bai !able triable
2 3 4
If ptmishable with Cognizable Non-ooilable Cotut ofSes.5ion E
death, inpriscrurmt fur
lire, or imµ"isonment
for mere than 7 yearn,
If punishable with Cognizable Non-ooilable Magistrate oftre
inµiscnrrent fur 3 fiist class F
. yearn, and UJlW<lfds bu
net mere furn 7 year.;,
If punishable with Non-cognizable Bailable Any Magistrate
irrp-isaurent for less
than 3 years or with fire
only. G
It is imperative for us to record, that the classification of offences
other than the offences under the Indian Penal Code, and the courts by
H
652 SUPREME COURT REPORTS (2017] 13 S.C.R.
A which such offences would be triable, expressed in Part II of the First
Schedule, must essentially be read with Section 26 of the Code of Criminal
Procedure. Part II of the First Schedule, would therefore be applicable
only in cases where, the other laws (-other than the Indian Penal Code)
do not postulate the adjudicatory court. In such cases, offences (-provided
for under other laws) if punishable with death, imprisonment for life or
B
imprisonment for more than seven years, would be tried by a Court of
Session, and where, the offence in question was punishable with
imprisonment for three years and upwards, but not more than seven
years, the adju<licatory court would be the Court of Magistrate of the
first class. And if, the punishment of the offence is imprisonment for
C less than three years or with fine only, the matter would be triable by any
Magistrate. The above contingencies contemplated in Part II of the First
Schedule (appended to the Code of Criminal Procedure), are clearly
inapplicable to 'the SEBIAct' on account of the fact, that the adjudicatory
court (prior to 'the 2002 Amendment Act'), was a court not inferior to
D that of the Metropolitan Magistrate (or, a Judicial Magistrate of the first
class), after 'the 2002 Amendment Act', it was a court not inferior to a
Court of Session, and finally, after 'the 2014 Amendment Act',
adjudication was vested with Special Courts. Therefore, at no stage
was there any ambiguity of 'forum' for trial which would deal with
offences postulated under 'the SEBI Act'.
E 50. We may now deal with the proposition canvassed pointedly.
The mandate contained in Section 260 of the Code of Criminal Procedure,
ebabling "(a) any Chief Judicial Magistrate; (b) any Metropolitan
Magistrate; (c) any Magistrate of the first class", to try in a summary
way offences mentioned at (i) to (ix) of sub-section (!), has a
F precondition. This precondition is, that the court concerned must be" ...
specifically empowered in this behalf by the High Court. .. ". Therefore,
the authority to decide a matter through a summary process under the
Code of Criminal Procedure has to be express (by the High Court), and
the same does not automatically flow out of Section 260, aforementioned.
The use of the words" ... all or any of the following offences ... "with
G reference to the offences mentioned at (i) to (ix) of sub-section (I) of
Section 260 further makes it apparent, that the summary process could
be applied only to the clearly defined exigencies/offences. It is therefore,
that Section 26(b) assumes significance, because it endeavours to deal
with offences provided for in special enactments. Reliance on Section
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 653
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!]
260, with reference to offences provided for in special enactments, in A
our view, is clearly misconceived. Since the 'forum for trial under the
SEBI Act' is derived from Section 26(b) of the Code of Criminal
Procedure, the same would need an express order of empowerment for
holding summary proceedings, before the court concerned adopts the
summary procedure. And that is exactly why, summary proceedings
B
are expressly provided for, by different legislative enactments, i.e., where
the competent court for trial is determined under Section 26(b) of the
Code of Criminal Procedure. It may illustratively be noticed, that when
legislative intent was to provide for summary proceedings, the legislation
itselfexpressly provided for the same, as under the Negotiable Instruments
Act, 1881, and the Food Adulteration Act, 1954, wherein summary c
procedure has been legislatively provided for. It is therefore apparent,
that the issue whether proceeding can be conducted by adopting the
summary procedure cannot be inferred, when the court for trial is
determined under Section 26(b) aforementioned. Both the above
enactments (the Negotiable Instruments Act, 1881; and the Food D
Adulteration Act, 1954), are regulated by Section 26(b) aforementioned,
just as 'the SEBI Act'. The number oflegislative enactments providing
for summary proceedings can be multiplied. What is of importance is,
that the legislative intent in matters falling in Section 26(b) of the Code
of Criminal Procedure, for holding summary proceedings has been
express. In the absence of any similar provision under 'the SEBI Act', E
it is natural to assume, that summary proceedings were not contemplated
by the legislation, and has to be considered as precluded. In the absence
of an express provision for holding summary proceedings in the trial of
offences under 'the SEBI Act', it is not possible for us to accept the
contention canvassed by learned counsel, by merely relying on Section
F
260 of the Code of Criminal Procedure.
51. It also needs to be kept in mind, that Section 26(2) of 'the
SEBI Act' (prior to 'the 2002 Amendment Act') expressly provided,
"No court inferior to that of a Metropolitan Magistrate (or, a Judicial
Magistrate of the first class) shall try an offence punishable under this
Act". It is therefore apparent, that it was not imperative, that the 'forum' G
for trial of offences under the unamended Section 24 of 'the SEBI Act'
would be conducted only by a Metropolitan Magistrate (or, a Judicial
Magistrate of the first.class). Trials for offences under 'the SEBI Act',
even prior to 'the 2002 Amendment Act', could well have been conducted
H
654 SUPREME COURT REPORTS [2017] 13 S.C.R.
A by a Court of Session, or an Additional Sessions Judge. Iftrial had actually
been vested in such a superior court (-as the same was possible), Section
260 of the Code of Criminal Procedure, would not have been applicable,
as Section 260 comes into play only for trials by courts of Chief Judicial
Magistrates, Metropolitan Magistrates and Judicial Magistrates of the
first class. For the instant reason also, the provision of Section 260 of the
B
Code of Criminal Procedure, cannot be so interpreted, as is suggested
by learned counsel representing the accused. Since the applicability of
Section 260 of the Code of Criminal Procedure to proceedings under
'the SEBI Act' has not been accepted, the prejudice claimed on behalf
of the accused under Section 262 of the Code of Criminal Procedure (-
c which is dependent on Section 260 of the Code) can also not be accepted.
52. The second contention advanced by Mr. D.P. Singh, learned
counsel was, that the right ofrevision available to the accused, prior to
the amendment to 'the SEBI Act', has been taken away. It was pointed
out, that this aspect also had substantive (and, not merely procedural)
D implications for the accused. It was pointed out, that the right of revision
being a valuable right of the accused, the deprivation of the above valuable
right, emerging from the change of 'forum' from the Court of the
Metropolitan Magistrate (or, Judicial Magistrate of the first class) by
'the 2002 Amendment Act', and by 'the 2014AmendmentAct', should
not be considered as a trivial procedural issue. It was submitted, that the
E taking away of the right of revision from an accused, has to be considered
as a substantial procedural deprivation. It was submitted, that cases
where an amending enactment, takes away favourable rights, by replacing
the same with an alternative which is less advantageous, would violate
the fundamental rights of the accused. On the instant aspect of the
F matter, learned counsel placed reliance on the State of West Bengal v.
Anwar All Sarkar Habib Mohamed, AIR 1952 SC 75, and drew the
Court's attention to the following:
"27. It was suggested that the reply to this query is that the Act
itselfbeing general and applicable to ail persons and to all offences,
G cannot be said to discriminate in favour of or against any particular
case or classes of persons or cases, and if any charge of
discrimination can be leveled at all, it can be leveled only against
the act of the executive authority if the Act is misused. This kind
of argument however does not appear to me to solve the difficulty.
The result of accepting it would be that even where discriminatibn
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 655
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
is quite evident one cannot challenge the Act simply because it is A
couched in general terms; and one cannot also challenge the act
of the executive authority whose duty it is to administer the Act,
because that authority will say:- I am not to blame as I am acting
under the Act. It is clear that if the argument were to be accepted,
article 14 could be easily defeated. I think the fallacy of the
B
argument lies in overlooking the fact that the "insidious
discrimination complained of is incorporated in the Act itself', it
being so drafted that whenever any discrimination is made such
discrimination would be ultimately traceable to it. The Act itself
lays down a procedure which is less advantageous to the accused
than the ordinary procedure, and this fact must in all cases be the c
root-cause of the discrimination which may result by the application
of the Act.
xxx xxx xxx
40. These two appeals are directed against the judgment of a
Special Bench of the Calcutta High Court dated the 28th ofAugust, D
1951, and they arise out of two petitions presented, respectively,
by the respondent in the two appeals under Art. 226 of the
Constitution praying for writs of certiorari to quash two criminal
proceedings, one of which has ended in the trial Court, resulting in
conviction of the accused, while the other is still pending hearing. E
The questions requiring consideration in both the appeals are the
same and the whole controversy centers round the point as to
whether the provision of section 5 (!)of the West Bengal Special
Courts Act, 1950, as well as certain notifications issued under it
are ultra vires the Constitution by reason of their being in conflict
with Art. 14 of the Constitution. The material facts, which are not F
controverted, may be shortly stated as follows. On 17-8-1949, an
Ordinance, known as the West Bengal Special Courts Ordinance,
was promulgated by the Governor of West Bengal under
section 88 of the GovernmentoflndiaAct, 1935. On 15-3-1950,
this Ordinance was superseded and replaced by the West Bengal G
Special Courts Act which contained provisions almost identical
with those of the Ordinance. Section 3 of the Act empowers the
State Government to constitute, by notification, Special Courts of
criminal jurisdiction for such areas and to sit at such places as
may be notified in the notification. Section 4 provides for
H
656 SUPREME COURT REPORTS [2017] 13 S.C.R.
A appointment of a Special Judge to preside over a Special Court
and it mentions the qualifications which a Special Judge should
possess.
Section 5( 1) then lays down that a Special Court shall try such
offences or classes of offences or cases or classes of cases as
B the State Government may, by general or special orders, in writing
direct. Sections 6 to 15 set out in details the procedure which the
Special Court has to follow in the trial of cases referred to it.
Briefly stated, the trial is to be without any jury or assessors. and
the Court has to follow the procedure that is laid down for trial of
warrant cases by the Magistrate under the Criminal Procedure
c Code. The procedure for committal in the sessions cases is omitted
altogether: the court's powers of granting adjournment are
restricted and special provisions are made to deal with refractory
accused and also for cases which are transferred from one Special
Court to another. The Court is expressly empowered to convict a
D person of an offence with which he was not charged if it transpires
from the evidence adduced at the time of trial that such offence
was committed by him. and it is immaterial that the offence is not
a minor offence. The right of revision to the High Court has been
taken away entirely, though appeals have been allowed in all cases
both at the instance of the accused as well as of the State and
E they lie1 both on questions of fact and law.
xxx xxx xxx
68. The argument that changes in procedural law are not material
and cannot be said to deny equality before the law or the equal
F protection of the laws so long as the substantive law remains
unchanged or that only the fundamental rights referred to in Arts.
20 to 22 should be safeguarded is. on the face of it. unsound. The
right to equality postulated by Art. 14 is as much a fundamental
right as any other fundamental right dealt with in part III of the
Constitution. Procedural law may and does confer very valuable
G rights on a person, and their protection must be as much the object
of a court's solicitude as those conferred under substantive law."
Reliance for the same proposition, was also placed on A.R. Antulay
V. R.S. Naik ( 1988) 2sec 602, wherein this Court while examining the
valuable rights of the appellant inter alia concluded, that the right of
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 657
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJI]
revision to the High Court under Section 9 of the. Criminal Law A
Amendment Act, was a valuable right of the accused, which had been
taken away.
53. It was therefore submitted, that the right of revision which
was vested in the accused under Section 397, read with Section 401 gf
the Code of Criminal Procedure, was available to the accused under the B
unamended provisions of' the SEBI Act', when adjudication for offences
under 'the SEBIAct' was vested with a Metropolitan Magistrate (or, a
Judicial Magistrate of the first class). It was submitted, that since the
adjudicatory procedure for holding trials for offences under 'the SEBI
Act' was vested with a Court of Session (under 'the 2002 Amendment
Act'), and thereafter, with the Special Court (consequent upon 'the 2014 C
Amendment Act'), the accused who have not been tried (prior to the
above amendments), stood deprived of the right of revision, under Section
397 read with Section 401 of the Code of Criminal Procedure. It was
therefore contended, that the amendment of'forum' of trial, in the facts
and circumstances of the present case, could not be treated as a mere D
procedural amendment, but was liable to be considered as having
substantive adverse implication for the accused. In order to support his
above· assertion, learned counsel placed reliance on Krishnan v.
Krishnaveni, ( 1997) 4 sec 241, and invited our attention to the following:
"7. It is seen that exercise of the revisional powef by the High E
ro
Court under Section 397 read with Section 401 is call for the
records of any inferior criminal court and to examine the
correctness. legalitv or proprietv of any finding. sentence or order.
recorded or passed. and as to the regularity of any proceedings of
such inferior court and to pass appropriate orders. The Court of
Sessions and the Magistrates are inferior criminal courts to the F
High Court and Courts of Judicial Magistrate are inferior criminal
courts to the Sessions Judge. Ordinarily. in the matter of exercise
of power of revision by any High Court. Section 397 and Section
401 are required to be read together. Section 397 gives powers to
the High Court to call for the records as also sua morn power G
·under Section 401 to exercise the revisional power on the grounds
mentioned therein, i.e., to examine the correctness, legality or
propriety of i!JlY finding, sentence or order, recorded or passed
and as to the regularity of any proceedings of such inferior court,
and to dispose of the revision in the manner indicated under Section
658 SUPREME COURT REPORTS (2017] 13 S.C.R.
A 40 I of the Code. The revisional power of the High Court merely
conserves the power of the High Court to see that justice is done
in accordance with the recognised rules of criminaljurisprudence
and that its subordinate courts do not exceed the jurisdiction or
abuse the power vested in them under the Code or to prevent
abuse of the process of the inferior criminal courts or to prevent
B
miscarriage ofjustice."
It was therefore the assertion ofleamed cpunsel, that the action
of transfer of pending matters from the Court of Metropolitan Magistrate
(or, Judicial Magistrate of the first class), to the Court of Session
(consequent l)pon 'the 2002 Amendment Act') and thereafter, to the
c Special Court (consequent upon 'the 2014 Amendment Act'), was liable
to be treated as prospective, failing which the accused will be deprived
of the important right ofrevision vested in him.
54. We have given our thoughtful consideration to the second
contention of Mr. D.P. Singh, Advocate, noticed in the foregoing
D paragraphs. In view of the legal position, namely, that power ofrevision
to a superior court does not confer or create a corresponding right in the
litigant, it is not possible for us to accept the aforesaid contention of
learned counsel. When the remedy of revision is considered as not a
right of an accused, at all, the absence of the remedy ofrevision cannot
E be considered1as deprivation of a right. In this behalf, reference may be
made to Pranab Kumar Mitra v. State of West Bengal, AIR 1959 SC
144, wherein it was held:
" ..... The revisional powers of the High Court vested in it by Section
439 of the Code, read with Section 435, do not create any right in
F the litigant. but only conserve the power of the High Court to see
that justice is done in accordance with the recognized rules of
criminal jurisprudence, and that subordinatl(Criminal Courts do
not exceed their jurisdiction, or abuse their powers vested in them
by the Code ...... ".
G The aforesaid determination also emerges from the following
observations recorded in paragraph 6 of the above judgment, which is
extracted hereunder:
"6. In our opinion, in the absence of statutory provisions, in terms
applying to an application in revision, as there are those in Section
H
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 659
CREDIT LTD. [JAGDISH SINGH K.HEHAR, CJI]
431 in respect of criminal appeals, the High Court has the power A
to pass such orders as to it may seem fit and proper, in exercise of
its revisionaljurisdiction vested in it by Section 439 of the Code.
Indeed, it is a discretionary power which has to be exercised in
aid of justice. Whether or not the High Court will exercise its
revisionaljurisdiction in a given case, must depend upon the facts B
and circumstances of that case. The revisional powers of the High
Court vested in it by Section 439 of the Code. read with Section
435. do not create any right in the litigant. but only conserve the
power of the High Court to see that justice is done in accordance
with the recognized rules of criminal jurisprudence. and that
subordinate Criminal Courts do not exceed their jurisdiction. or C
abuse their powers vested in them by the Code. On the other
hand, as already indicated, a right of appeal is a statutory right
which has got to be recognized by the courts, and the right to
appeal, where one exists, cannot be denied in exercise of the
discretionary power even of the High Court. The legislature has,
therefore, specifically provided, by Section 431 of the Code, the D
, rules governing the right of substitution in case of death of an
appellant, but there is no corresponding provision in Chapter XXXlI,
dealing with the question ofabatement and the right ofsubstitution
in a criminal revision. We may assume that the legislature was
aware of the decision of the Bombay High Court. referred to E
above. when it enacted Section 431 for the first time in the Code
of 1882. If the legislature intended that an application in revision
pending in a High Court. should be dealt with on the same footing
as a pending appeal. it would have enacted accordingly. But in the
absence of any such enactment, we may infer that the power of
revision vested in the High Court under Chapter XXXII of the F
Code. was left untouched - to be exercised according to the
exigencies of each case. The High Court is not bound to entertain
an application in revision. or having entertained one. to order
substitution in everv case. It is not bound the other way, namely,
to treat a pending application in revision as having abated by reason G
of the fact that there was a composite sentence of imprisonment
and fine, as some of the Single Judge decisions placed before us,
would seem to indicate. The High Court has beep kft complete
discretion to deal with a pending matter on the death of the petitioner
H
660 SUPREME COURT REPORTS [2017] 13 S.C.R.
A in accordance with the requirements of justice. The petitioner in
the High Court may have been an accused person who has been
convicted and sentenced, or he may have been a complainant
who may have been directed under Section 250 of the Code to
pay compensation to an accused person upon his discharge or
acquittal. Whether it was an accused person or it was a complainant
B
who has moved the High Court in its revisionaljurisdiction, ifthe
High Court has issued a rule, that rule has to be heard and
determined in accordance with law, whether or not the petitioner
in the High Court is alive or dead, or whether he is represented in
court by a legal practitioner. In hearing and determining cases
c under Section 439 of the Code, the High Court discharges its
statutory function of supervising the administration of justice on
the criminal side. Hence, the considerations applying to abatement
of an appeal, may not apply to the case of revisional applications.
In our opinion, therefore, the Bombay majority decision, in the
absence of any statutory provisions in respect of criminal revisional
D
cases, lays down the correct approach."
Reference on the above issue, may also be made to Kamlesh
Kurnarv. State of Jharkhand, (2013) 15 SCC 460, wherein this Court
held as under:
E "41. This question proceeds on the assumption that there is a
right of revision. A Constitution Bench of this Court in Pranab
Kumar Mitra v. State of W.B. set the "right" issue at rest several
decades ago. It was held that the power to revise an order is a
discretionary power which is to be exercised in aid of justice and
the exercise of that power will depend on the facts and
F circumstances of a given case. It was held: (AIR p. 147, para 6)
"6 .... The revisional powers of the High Court vested in it by
Section 439 of the Code read with Section435, do not create any
right in the litigant, but only conserve the power of the High Court
to see that justice is done in accordance with the recognised rules
G of criminal jurisprudence. and that subordinate criminal courts do
not exceed their jurisdiction, or abuse their powers vested in them
by the Code."
xxx xxx xxx
H
]
SECURITIES AND EXCHANGE BOARD OF INDIA v. CLASSIC 661
CREDIT LTD. [JAGDISH SINGH KHEHAR, CJ!)
43. While the revisional power of a superior court actually enables A
it to correct a grave error, the existence of that power does not
confer any corresponding right on a litigant. This is the reason
why, in a given case, a superior court may decline to exercise its
power of revision, if the facts and circumstances of the case do
not warrant the exercise of its discretion. This is also the reason
B
why it is felicitously stated that a revision is not a right but only a
"procedural facilitv" available to a partv. If the matter is looked at
in this light, the transfer of a cas·e from a Magistrate to a Special
Judge does not take away this procedural facilitv available to the
petitioners. It only changes the forum and as already held above, ·
the petitioners have no right to choose the forum in which to file C
an appeal or move a petition for revising an interlocutory order."
55. For the reasons recorded hereinabove, we find no merit even
in the second contention advanced by Mr. D.P. Singh, learned counsel
representing the accused.
56. In view of the consideration recorded hereinabove, we are of D
the view, that the 'forum' for trial earlier vested in the Court of
Metropolitan Magistrate (-or, Judicial Magistrate of the first class) was
retrospectively amended, inasmuch as, the 'forum' of trial after. 'the
2002 Amendn/.ent Act' was retrospectively changed to the Cou;.t of
Session. In this view of the matter, the trials even in respect of offences E
allegedly committed before 29.I 0.2002. (-the date with effect from which,
'the 2002 Amendment Act' became operational), whether in respect
whereof trial had or had not been initiated, would stand jurisdictionally
vested in a Court of Session. And ·likewise, trials of offences un.der the
SEBI Act, consequent upon 'the 2014 Amendment Act (which became
operational, with effect from 18.07.2013) would stand jurisdictionally F
transferred for trial to a Special Court, irrespective ofwhether the offence
under the SEBI Act was committed before 29.10.2002 and/or before
18.07.2013 (-the date with effect from which 'the 2014 Amendment
Act' became operational), and irrespective of the fact whether trial had
or had not been initiated. Our above conclusion, affirms the determination G
· '-fecorcfed by the Delhi High Court in Mahe'nder Singh v. High Court of
Delhi (Writ Petition (C) No.141 of2007, decided on 1LOI .2008), but for
the reasons recorded hereinabove. The impugned judgment rendered'
by the High Court of Bombay in Mis. Classic Credit Ltd. v. State of
H
662 SUPREME COURT REPORTS (2017] 13 S.C.R.
A Maharashtra (Criminal Application No.1557 of 2007, decided on
16.01.2008), is liable to be set aside, and is accordingly hereby set aside.
57. The instant bunch of cases is disposed of in the above terms.
B Note: The emphases supplied in all the quotations in the instant
judgment, are ours.
Nidhi Jain Matters disposed of.
'
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