In a key pronouncement on the effect of judicial overruling, the Supreme Court has held that when a subsequent judgment overrules an earlier decision, it merely corrects the previous interpretation and applies retrospectively unless the Court specifically directs otherwise. The ruling came in Directorate Of Revenue Intelligence vs Raj Kumar Arora & Ors., Criminal Appeal No. 1319 of 2013, decided by a Bench of Justice J.B. Pardiwala and Justice Manoj Misra.
The Court emphasized that “a judgment which interprets a statute or provision declares the meaning of the statute as it should have been construed from the date of its enactment and what has been declared to be the law of the land must be held to have always been the law of the land”.
Background of the Case
The appeal arose from a prosecution initiated by the Directorate of Revenue Intelligence (DRI) under Sections 8(c), 22, and 29 of the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act). The case pertained to the recovery of 40,001 glass ampoules of Buprenorphine Hydrochloride from an office in New Delhi, along with further seizures from M/s Win Drugs Ltd. in Jind, Haryana.
Although Buprenorphine is listed in the Schedule to the NDPS Act, it does not appear in Schedule I of the NDPS Rules, 1985. The trial court, and subsequently the High Court, held that because the substance was not listed in Schedule I of the Rules, no offence under the NDPS Act was made out. The cases were therefore remitted for trial under the Drugs and Cosmetics Act, 1940 (D&C Act).
Key Legal Issues
The Court framed, among others, the following central question:
- Whether the decision in Union of India vs Sanjeev V. Deshpande (2014) 13 SCC 1—which clarified that Section 8(c) of the NDPS Act applies to all substances listed in the Act’s Schedule even if they are not included in Schedule I of the NDPS Rules—should apply retrospectively.
Arguments of the Appellant
The Additional Solicitor General, Mr. Vikramjit Banerjee, appearing for the Directorate of Revenue Intelligence, submitted that the decision in Sanjeev V. Deshpande was declaratory in nature and did not lay down a new rule of law. Hence, the ruling should operate retrospectively.
He argued that:
“The interpretation of law in Sanjeev V. Deshpande clarified the existing provision and does not constitute a new legal principle. Therefore, it must apply to pending cases, including the present one.”
It was further contended that the High Court erred in relying on earlier decisions such as State of Uttaranchal vs Rajesh Kumar Gupta, which were later overruled by Sanjeev V. Deshpande.
Arguments of the Respondents
The respondents, represented by Mr. Yash Pal Dhingra, contended that the decision in Sanjeev V. Deshpande must apply prospectively. They relied on the earlier position of law upheld by the Delhi High Court in Rajender Gupta v. State and Rajesh Sharma v. Union of India, which held that a psychotropic substance not included in Schedule I of the NDPS Rules could not attract prosecution under the NDPS Act.
It was submitted that the accused had already been discharged under the earlier interpretation and retrospective application of the new judgment would cause serious prejudice.
Supreme Court’s Analysis
On the retrospective applicability of the decision in Sanjeev V. Deshpande, the Supreme Court categorically held:
“The default rule is that the overruling of a decision generally operates retrospectively. This is because a judgment which interprets a statute or provision declares the meaning of the statute as it should have been construed from the date of its enactment and what has been declared to be the law of the land must be held to have always been the law of the land”.
The Court rejected the contention that retrospective application would cause prejudice. It clarified:
“Since resorting to the doctrine of ‘prospective overruling’ is an exception to the normal rule that a judgment or decision applies retrospectively and to the general rule of doctrine of precedent, an express declaration by the court that its decision is prospectively applicable is absolutely necessary. Prospectivity as a concept cannot be considered to be inhered in situations since the intention to attribute prospectivity to a decision must be limpid and clear”.
Further, the Court explained the principle behind judicial overruling:
“The judge rather than being the creator of the law, is only its discoverer. Therefore, if a 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”.
Conclusion and Decision
Holding that the High Court’s reliance on overruled judgments was legally unsustainable, the Supreme Court allowed the appeal and restored the NDPS charges against the accused.
It concluded that:
- The judgment in Sanjeev V. Deshpande declared the correct legal position under Section 8(c) of the NDPS Act.
- That declaration must apply retrospectively, unless expressly stated otherwise.
- The impugned orders discharging the respondents and remitting the case under the D&C Act were unsustainable.
Accordingly, the appeals were allowed, and the matters were remitted to the Special Courts to proceed with the trials under the NDPS Act.
