SC refers a 2018 decision on automatic vacation of stay Orders to five-judge Bench

In the 2018 judgment, the court had held that in all matters, civil or criminal, Orders of stay, once granted, should not continue beyond a period of six months unless specifically extended and the stay shall stand vacated automatically at the end of that period.

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ON Friday, a three-judge Bench of the Supreme Court headed by Chief Justice of India (CJI) D.Y. Chandrachud raised doubts about the correctness of a 2018 decision by a coordinate Bench in Asian Resurfacing of Road Agency (P) Ltd versus CBI.

In that case, the court had held that in all matters, civil or criminal, Orders of stay, once granted, should not continue beyond a period of six months unless specifically extended and the stay shall stand vacated automatically at the end of that period.

The Bench which also comprised Justices J.B. Pardiwala and Manoj Misra observed that there could be no gainsaying the fact that a stay of an indefinite nature results in prolonging civil or criminal proceedings, but the fact that the delay is not always on account of the conduct of the parties involved needs to be factored in. 

"The delay may also be occasioned by the inability of the court to take up proceedings expeditiously. The principle which has been laid down in the above decision to the effect that the stay shall automatically stand vacated (which would mean an automatic vacation of stay without application of judicial mind to whether the stay should or should not be extended further) is liable to result in a serious miscarriage of justice," the Bench observed.

The Bench thus referred the matter to a larger Bench of five judges.

The reference Order came on an appeal filed by the High Court Bar Association of Allahabad.

In the Asian Resurfacing case, a three-judge Bench comprising Justices A.K. Goel, Rohinton Fali Nariman and Navin Sinha held that proceedings remaining pending for long on account of stay needed to be remedied.

"Remedy is required not only for corruption cases but for all civil and criminal cases where on account of stay, civil and criminal proceedings are held up. At times, proceedings are adjourned sine die on account of stay. Even after stay is vacated, intimation is not received and proceedings are not taken up," the Bench had observed.

It had thus directed that in all pending cases where stay against proceedings of a civil or criminal trial was operating, the same would come to an end on expiry of six months from today unless in an exceptional case by a speaking Order such stay is extended.

"In cases where stay is granted in future, the same will end on expiry of six months from the date of such Order unless a similar extension is granted by a speaking Order.

"The speaking Order must show that the case was of such exceptional nature that continuing the stay was more important than having the trial finalised. The trial court where Order of stay of civil or criminal proceedings is produced, may fix a date not beyond six months of the Order of stay so that on expiry of the period of stay, proceedings can commence unless an Order of extension of stay is produced," the Bench had held.

Click here to read the order.