SCO.LR | Volume 4 | Issue 1

Each week, the Supreme Court of India hears hundreds of cases and decides tens of them. Since 2017, the Supreme Court Observer has developed a comprehensive Case Archive of all cases of public importance, or those that change the law. This Case Archive includes court submissions, hearing reports and analyses for every case.

Today we announce our new initiative: the Supreme Court Observer Law Reports (SCO.LR). Each week, SCO.LR will select, summarise and present easily accessible versions of five significant and unmissable judgements. Taken together, the SCO Case Archive and SCO.LR are the only resources you will need to track the Supreme Court of India!

Today, we release Volume 4 of SCO.LR. This issue covers judgements from 1 April to 7 April 2025. Each week we will release a new issue. Over time, we will add new features and incrementally cover all back issues from January 2025. 

**********

Payment of Bonus

The Management of Worth Trust v The Secretary, Worth Trust Workers Union 

2 April 2025

Citations: 2025 INSC 432 | 2025 SCO.LR 4(1)

Bench: Justices Sudhanshu Dhulia and K. Vinod Chandran

The Supreme Court held that a charitable trust that produces commercial goods and generates surplus revenue is not exempt from paying bonuses to workers under the Payment of Bonus Act, 1965.

The appellant, WORTH Trust—originally a Swedish Red Cross initiative for rehabilitating leprosy patients—began industrial operations in 1981 and manufactured automobile and industrial machinery parts. In 1998, the Industrial Disputes Tribunal and the Madras High Court directed the trust to pay a bonus and ex gratia in response to a demand by factory workers. The Trust argued that it was exempt under Section 32 of the Act, either as a Red Cross-affiliated body or a not-for-profit institution.

The Supreme Court rejected these arguments and directed the Trust to pay bonuses to its workers from 1996–97. It emphasised that the Trust’s commercial activities and its disassociation from the Swedish Red Cross in 1989 made it subject to the Act.

Keyphrases: Payment of Bonus Act 1965—Section 32—Charitable Trust exception—Factories Act—commercial use—bonus

Read the judgement here.

**********

Payment of pendente lite Interest in Arbitration

Ferro Concrete Construction (India) v State of Rajasthan 

2 April 2025 

Citation: 2025 INSC 429 | 2025 SCO.LR 4(2)

Bench: Justices P.S. Narasimha and Joymalya Bagchi

The Supreme Court held that a contractual bar on payment of interest on any arrears or balance does not prevent an arbitrator from awarding pendente lite interest with the arbitral award unless expressly stated in the contract.

In an arbitration proceeding arising out of a work contract between Ferro Concrete Construction and the Rajasthan Government, the arbitrator awarded 15 percent pendente lite interest to Ferro Concrete. A district court set aside the award of pendente lite interest, citing a clause in the contract that barred payment of interest on any arrears or balance. The Rajasthan High Court dismissed appeals against the district court order.

The Supreme Court found that the contract did not expressly state that an arbitrator cannot grant pendente lite interest. It upheld the arbitrator’s award. The Court relied on Union of India v Ambica Construction (2016) and Reliance Cellulose Products v ONGC (2018), which both held that arbitrators can grant pendente lite interest under the Arbitration Acts of 1940 and 1996 unless it was expressly barred by the contract.

Key Phrases: Arbitral award—pendente lite interest—effect of contractual bar on interest—Reliance Cellulose—First Ambica—Arbitration Act 1940—Arbitration Act 1996 

Read the judgement here.

**********

Charge for Murder and Homicide

Maukam Singh v State of Madhya Pradesh 

2 April 2025

Citation: 2025 INSC 435 | 2025 SCO.LR 4(3)

Bench: Justices Sudhanshu Dhulia and K. Vinod Chandran

The Supreme Court held that the intention to cause death was essential for conviction for murder under Section 302 of the Indian Penal Code, 1860.

An elderly man was killed and his two grandchildren injured in a fatal assault during a dispute over a place of worship in Madhya Pradesh. The trial court convicted the three accused individuals under Sections 302, 323 and 324 read with Section 34 of the Code, sentencing them to life imprisonment. The Madhya Pradesh High Court upheld this decision.

The Supreme Court, acting under Article 136, modified the conviction to culpable homicide not amounting to murder under Section 304 Part II of the Code as the act was committed with the knowledge that it could cause death but was not done with the intention to kill.

Key Phrases: Murder—culpable homicide not amounting to murder—Section 302 intention—Section 304 knowledge—Indian Penal Code 1860—Article 136

Read the judgement here.

**********

Default Bail under Section 167(2) of CrPC

State (NCT) of Delhi v Rajeev Sharma

 3 April 2025

Citation: 2025 INSC 456 | 2025 SCO.LR 4(4)

Bench: Justices B.M. Trivedi and P.B. Varale

The Supreme Court clarified that 90-day default bail under Section 167(2)(a)(i) of the Code of Criminal Procedure, 1973 applies only to offences with a minimum punishment of 10 years.

The Delhi High Court granted default bail to Rajeev Sharma after 60 days under Section 167(2)(a)(ii) as the investigation was incomplete. Sharma was charged with an offence under the Official Secrets Act, 1923 that was punishable by imprisonment up to 14 years but did not carry a minimum punishment. The State argued that the applicable provision was Section 167(2)(a)(i) for default bail within 90 days.

The Supreme Court upheld the High Court’s decision, relying on Rakesh Kumar Paul v State of Assam (2017). The judges reiterated that the 90-day limit applies only when a minimum 10-year sentence is prescribed. For all other offences, the 60-day period was valid.

Key Phrases: Default bail—Section 167(2)(a)(i) 90 days—Criminal Procedure Code, 1973—Section 167(2)(a)(ii) 60 days—minimum punishment of 10 years—Rakesh Kumar Paul

Read the judgement here. 

**********

Recovery of Excess Payments

Jogeswar Sahoo v The District Judge, Cuttack 

4 April 2025

Citation: 2025 INSC 449 | 2025 SCO.LR 4(5)

Bench: Justices P.S. Narasimha and P.K. Mishra

The Supreme Court held that excess payments made to an employee, without any misrepresentation or fraud on their part, cannot be recovered by an employer. The Court also quashed recovery orders directing the employees to deposit the excess arrears.

Excess payments had been made to stenographers in Cuttack’s district judiciary. Recovery orders were issued six years later. The former employees challenged these orders before the High Court and were unsuccessful. 

The Supreme Court reversed the High Court’s decision citing several judgements including Thomas Daniel v State of Kerala (2022). It noted that as the payments arose from the employer’s misinterpretation of the rules with no fault attributable to the employees, those recoveries will be barred by equity.

Key Phrases: Recovery of excess payments from employees—misinterpretation of applicable rules by employer—service law—equity—absence of fraud or misrepresentation by employee

Read the judgement here.

 

This article was first featured in SCO’s Weekly newsletter. Sign up now!

SUBSCRIBE!