In a significant ruling, the Supreme Court on April 17 clarified that when an earlier judgment is overruled by a subsequent decision, the latter will generally apply retrospectively unless the Court explicitly states otherwise.
"If the subsequent decision alters or overrules the earlier one, it cannot be said to have made a new law. The correct principle of law is just discovered and applied retrospectively," the Court observed.
A Bench comprising Justices J.B. Pardiwala and Manoj Misra made this observation while dealing with appeals involving interpretation of the Narcotic Drugs and Psychotropic Substances (NDPS) Act, specifically concerning the psychotropic substance Buprenorphine Hydrochloride.
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The Court emphasized that an overruling decision only refines the law to reflect its true meaning and does not create a new one. It added:
"The duty of the Court is not to pronounce a new law but to maintain and expound the old one. The judge is not the creator of the law, but only its discoverer."
Background of the Case
The case involved the Directorate of Revenue Intelligence (DRI) and certain accused individuals who were allegedly involved in the illegal manufacture, storage, and sale of Buprenorphine Hydrochloride, a psychotropic substance listed under the NDPS Act but not in the NDPS Rules.
Previously, in State of Uttranchal v. Rajesh Kumar Gupta, the Supreme Court held that prosecution under the NDPS Act was not maintainable if the substance was not listed in the NDPS Rules.
However, this view was later overruled in Union of India v. Sanjeev V. Deshpande (2014), where the Court clarified that any substance listed in the NDPS Schedule—regardless of whether it appears in the NDPS Rules—can be prosecuted under the Act.
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Since the judgment in Deshpande did not mention prospective application, the Court held that it would have retrospective effect, making the earlier ruling in Rajesh Kumar Gupta ineffective from the outset.
The Trial Court had earlier removed charges under the NDPS Act against the accused based on the Rajesh Kumar Gupta decision. The High Court upheld this ruling.
However, the DRI approached the Supreme Court, arguing that the Deshpande judgment should prevail and apply retrospectively, meaning the accused could still be tried under the NDPS Act.
Accepting this, the Supreme Court ruled in favour of DRI and set aside the High Court’s judgment, reinstating the charges.
The Court also made important observations on the doctrine of prospective overruling. It stressed that the doctrine must be applied only in exceptional circumstances, and not routinely.
"The doctrine of prospective overruling or the attribution of prospectivity to a decision must not be resorted to in a routine manner. All pending matters and future cases would automatically and inescapably be governed by the law declared in the overruling decision," the Court stated.
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It further noted that in the absence of a clear declaration in the judgment, all overruling decisions should be treated as retrospective.
“The law declared by this Court would have a retrospective effect unless stated otherwise,” it reiterated.
The ruling has clarified that unless explicitly limited, any Supreme Court judgment that overrules a previous decision becomes the binding law from the start. This has a far-reaching impact, especially in criminal matters where earlier legal interpretations were relied upon by lower courts.
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Case Title: DIRECTORATE OF REVENUE INTELLIGENCE VERSUS RAJ KUMAR ARORA & ORS.
Appearance:
For Appellant(s) Mr. Vikramjit Banerjee, ASG Ms. Ruchi Kohli, Sr. Adv. Mr. Prashant Rawat, Adv. Ms. Srishti Mishra, Adv. Mr. S.K. Tyagi, Adv. Mr. G.S. Makkar, Adv. Mr. B. Krishna Prasad, AOR Ms. Ruchi Kohli, Adv. Mr. Vatsal Joshi, Adv. Mr. Anuj Srinivas Udupa, Adv. Mr. Sarthak Karol, Adv. Mr. Arvind Kumar Sharma, AOR
For Respondent(s) Mr. Yash Pal Dhingra, AOR Mr. Deepak Goel, AOR Mr. Jitendra Bharti, Adv. Ms. Alka Goyal, Adv.
