Appeal
2. The instant Criminal Appeal assails the Judgment and Order dated 05.05.2021 (hereinafter “Impugned Order”) passed by the High Court of Delhi (hereinafter, “High Court”), whereby it recalled its earlier Judgment dated 13.08.2020 which had disposed of Criminal Miscellaneous (Co.) No. 4 of 2019 filed under Section 340 Criminal Procedure Code, 1973 (hereinafter, “CrPC”) against the Appellants for prosecution of offences of perjury and directed that the said application be listed for hearing. In the Judgment dated 13.08.2020, the High Court declined to interfere in the matter in view of the directions of this Court in Judgment dated 08.05.2014 passed in SLP (Criminal) No. 6873 of 2010 whereby dispute between the parties in relation to their Company Petition No.114 of 2007 (hereinafter “CP 114 of 2007”) and other related matters arising out of it was to be decided by Company Law Board (hereinafter, “CLB”).
4. Briefly, the facts relevant for adjudication of the case in hand is that two groups, namely, the Khosla Group (comprising of Mr. R.P. Khosla, Mr. Deepak Khosla – son of R.P. Khosla and Ms. Sonia Khosla – wife of Mr. Deepak Khosla) and the Bakshi Group (comprising of Mr. Vikram Bakshi, Mr. Vinod Surha and Mr. Wadia Prakash) came together in relation to development of a resort at Kasauli in the State of Himachal Pradesh on the land owned by the Khosla Group where the Bakshi Group was to finance and manage the entire project.
5. The undisputed facts as presented and extracted from material on record are that a Memorandum of Understanding dated 21.12.2005 (hereinafter “MoU”) was entered between Mr. Deepak Khosla (representing Khosla Group), Mr. R.P. Khosla, Mr. Vikram Bakshi and Montreaux Resorts Private Limited (hereinafter “MRPL”) for development of the project.
Appellants contention
24. The learned Senior Counsel for the Appellants contends that there is no power of review under Criminal Procedure Code of 1973. The only power available under Section 362 of CrPC is to correct a clerical or arithmetical error. To substantiate this contention, reliance is placed upon the decision of this Court in Sanjeev Kapoor vs. Chandana Kapoor and Others [(2020) 13 SCC 172] which held that that there are only two relaxations given from the rigour of Section 362 of CrPC where such power to alter or review is provided either (i) by the CrPC itself or (ii) by any other law for time being in force and no such relaxations are met out in the Impugned Order. He further highlighted that the High Court in Impugned Order agreed with the proposition that review was not maintainable, yet decided to review and recalled its Judgment dated 13.08.2020. He contends that this Court while dealing with the litigation between two groups involving similar applications under section 340 of CrPC, vide Judgment dated 08.05.2014 had directed CLB/NCLT to decide the matter and restrained the High Court to proceed with the application under section 340 of CrPC. The learned Counsel contends that the High Court acted in violation of this Court’s above judgment while passing the Impugned Order. He prays for setting aside of Impugned Order dated 05.05.2021 passed by the High Court.
25. Per contra, the learned Counsel for the Respondents, contends that the Impugned Order dated 05.05.2021 is a classic manifestation of the court undoing its own wrong. He submits that the Order was not passed under any statutory provision but by the court acting ex debito justitiae in order to undo the injurious effect flowing from its factually erroneous observation included in Judgment dated 13.08.2020. He relied on the order passed by this Court in Ganesh Patel vs. Umakant Rajoria [2022 SCC OnLine SC 2050] which relying on Grindlays Bank Ltd. vs. Central Government Industrial Tribunal and Others [1980 Supp SCC 420] has carved out a distinction between “procedural review” and “substantive review” and has clarified that when it comes to procedural review, the rigour of Section 362 of CrPC will not be attracted. He submits that the recall in such circumstances is a recall simpliciter and not a review ensuing recall which is on merits. He further asserted that the High Court in the Impugned Order has clearly recorded that it is not entering into the merits of case and merely correcting the mistake it made in Judgment dated 13.08.2020 due to absence of the correct material factual development and thus sustainable. Further, it is contended that while passing its Judgment dated 13.08.2020, the High Court was not dealing with a criminal proceeding per se, as the outcome of application filed under Section 340 of CrPC does not directly result into any sentence or fine or any other implication which is a necessary outcome for a proceeding to be of criminal in nature. The proceedings under section 340 of CrPC are just to ascertain whether an offence of perjury has been prima facie made out. He, therefore, prays for dismissal of the appeal.
Issue for consideration
26. Having heard the learned Counsels for the parties, and on perusal of the material on record, the primary issue which arises for consideration of this Court is “whether a review or recall of an order passed in a criminal proceeding initiated under section 340 of CrPC is permissible or not?” In our opinion, the resolution of the said issue would lead to conclusion of present petition.
Section 362 Cr.P.C: Power of criminal court to review or alter its own judgment or order
27. The law relating to power of a criminal court to review or alter its own judgment or order is governed by the provisions of Section 362 of CrPC (equivalent to Section 403 of Bhartiya Nagrik Suraksha Sanhita, 2023). The Provision explicitly provides that except for clerical and arithmetical error, no court shall alter or review its judgment. It is appropriate to refer to the bare provision of Section 362 of CrPC which reads as follows:
“362. Court not to alter judgment.–– Save as otherwise provided by this Code or by any other law for the time being in force, no Court, when it has signed its judgment or final order disposing of a case, shall alter or review the same except to correct a clerical or arithmetical error.”
27A. The comparison of the power of review of a civil court visa-vis power of criminal court to review or recall its own judgment or order arising out of criminal proceedings has been put to rest by numerous decisions of this Court. It would be appropriate at this juncture to discuss the relevant decisions of this court pertaining to review or recall power of criminal courts to ascertain the correct position of law before proceeding to refer and deal with the factual matrix of the present case.
Judgments discussion on review in criminal proceedings
28. The scope of Section 362 of CrPC has been discussed and elaborated by a three-judge bench decision of this Court in State of Kerala vs. M.M. Manikantan Nair [(2001) 4 SCC 752] wherein it held that CrPC does not authorize High Court to review its judgment or order passed either in exercise of its appellate, revisional or original jurisdiction. Section 362 explicitly prohibits the court after it has signed its judgment or final order disposing of case from altering or reviewing the said judgment or order except to correct a clerical or arithmetical error. This prohibition is complete and no criminal court can review its own judgment or order after it is signed.
29. Similarly, in Hari Singh Mann vs. Harbhajan Singh Bajwa and Others, this Court observed that section 362 of CrPC is based on the acknowledged principle of law that once a matter is finally disposed of by a court, the said court, in absence of specific statutory provisions, becomes functus officio and is disentitled to entertain fresh prayer for same relief.
30. In Sanjeev Kapoor (supra) it has been reiterated that Section 362 of CrPC imposes an embargo on a criminal court to alter and review its own judgment. Elaborating on the two relaxations envisioned by the legislature, this Court explained that an alteration or review is only feasible if it is so provided by the said legislation itself or by any other law in force. It was also clarified that such an attempt to alter or review is also not feasible or permissible through a reference to Section 482 of CrPC for being expressly barred under Section 362 of CrPC.
31. This Court, however, in exceptional cases, has carved out limited scope for exercise of review power by criminal courts. In Grindlays Bank Ltd. (supra), it was observed that review can be distinguished between “procedural review” and “substantive review”. A “procedural review” is inherent or implied in a court to set aside a palpably erroneous order passed under misapprehension by it, however, a “substantive review” is when error sought to be corrected is one of law and is apparent on the face of the record. It is in the latter sense, this Court, held that no review lies on merits unless specifically provided under a statute.
32. This distinction has been further clarified in Budhia Swain and Others vs. Gopinath Deb and Others, wherein this Court has laid down certain grounds on which a criminal court can review or recall its judgment or order i.e. when the proceedings before it itself suffers from an inherent lack of jurisdiction or, a fraud is played upon court to obtain the order or, a mistake of court causing prejudice to party or the order was in ignorance of nonserving of necessary party or party had died and estate was not represented. It was further clarified that these exceptions were subjected to the limitation that such grounds cannot be raised to recall or review if they were available during the original action and was not availed.
33. In Ganesh Patel (supra) this Court held that application for recall seeking “procedural review” and not “substantive review” to which Section 362 of CrPC be attracted is permissible. This Court upheld the order of the High Court wherein it recalled the earlier order passed in the absence of the Respondent and based on false information.
34. A careful consideration of the statutory provisions and the aforesaid decisions of this Court clarify the now-well settled position of jurisprudence of Section 362 of CrPC which when summarize would be that the criminal courts, as envisaged under the CrPC, are barred from altering or review their own judgments except for the exceptions which are explicitly provided by the statute, namely, correction of a clerical or an arithmetical error that might have been committed or the said power is provided under any other law for the time being in force. As the courts become functus officio the very moment a judgment or an order is signed, the bar of Section 362 CrPC becomes applicable, this, despite the powers provided under Section 482 CrPC which, this veil cannot allow the courts to step beyond or circumvent an explicit bar. It also stands clarified that it is only in situations wherein an application for recall of an order or judgment seeking a “procedural review” that the bar would not apply and not a substantive review” where the bar as contained in Section “362 CrPC is attracted. Numerous decisions of this Court have also elaborated that the bar under said provision is to be applied stricto sensu.
Exceptions to section 362 Cr.P.C
34A. Having said that, the following exceptional circumstances may be identified, wherein a criminal court is empowered to alter or review its own judgment or a final order under section 362 CrPC:
a. Such power is expressly conferred upon court by CrPC or any other law for the time being in force or;
b. The court passing such a judgement or order lacked inherent jurisdiction to do so or;
c. A fraud or collusion is being played on court to obtain such judgment or order or;
d. A mistake on the part of court caused prejudice to a party or;
e. Fact relating to non-serving of necessary party or death leading to estate being non-represented, not brought to notice of court while passing such judgment or order.
It needs to be reiterated that all these exceptions are only exercisable for seeking a recall or review of an order or judgment, if a ground that is raised was not available or existent at the time of original proceedings before the Court. Mere fact that the said ground, although available, was not raised or pressed during the concerned proceedings, does not provide for an exemption to the parties to assert it as a ground. Moreover, the said power cannot be invoked as a means to circumvent the finality of the judicial process or mistakes and/or errors in the decision which are attributable to a conscious omission by the parties.
Section 4 Cr.P.C
36. The scheme of CrPC as enshrined in its long title defines it is an Act “to consolidate and amend the law relating to Criminal Procedure”. Further, Section 4 of CrPC provides for scope of the CrPC which is reproduced herein:
“4. Trial of offences under the Indian Penal Code and other laws.
(1) All offences under the Indian Penal Code (45 of 1860) shall be investigated, inquired into, tried, and otherwise dealt with according to the provisions hereinafter contained.
(2) All offences under any other law shall be investigated, inquired into, tried, and otherwise dealt with according to the same provisions, but subject to any enactment for the time being in force regulating the manner of place of investigating, inquiring into, trying or otherwise dealing with such offences.”
The provisions of Sub-section (1) of Section 4 of CrPC expressly mandates an investigation, inquiry or trial of offences under Indian Penal Code of 1860 to be conducted strictly as per the procedure provided in the provisions of the CrPC. The definition of “inquiry” as stipulated in Section 2 (g) of CrPC means every inquiry, other than a trial, conducted under the CrPC by a Magistrate or Court.
As per section 340 Cr.P.C holding preliminary inquiry is must
37. The intent of proceedings as can been seen from provision of Section 340 of the CrPC, is to determine as to whether a complaint ought to be made in writing by concerned court to the competent Magistrate for prosecution of accused in respect of an offence alleged to have been committed in or in relation to a proceeding in a court. Section 340 of CrPC empowers the court that such determination may be done by way of holding preliminary inquiry to ascertain sufficient material to justify the initiation of prosecution against the accused. The nature of such an inquiry is not administrative or mere procedural. It is an initial step to a course which may lead to criminal prosecution, and this step is taken by a court with avowed purpose of examining whether a person should be prosecuted for an offence which, more often than not, relates to fabricating or giving false evidence, or committing other offences affecting the administration of justice, all of which are offences punishable under the Indian Penal Code.
Section 340 Cr.P.C shall be inquired as per Cr.P.C in the eye of section 4(1) Cr.P.C
38. If the nature of proceeding is such, the outcome of which, may result in a trial before a criminal court and, upon conviction, entail punishment for an offence under the penal law, then such a proceeding must, in substance, be treated as criminal in nature. Section 4(1) of the Code mandates that all offences under the Indian Penal Code. must be investigated, inquired into, tried, and otherwise dealt with in accordance with the procedure prescribed by the CrPC. The nature of the proceeding is determined by its substance and consequences it may result into. Thus, a proceeding initiated under section 340 of CrPC is in the nature of criminal proceeding and governed by the provisions of the CrPC, as a consequence, thereof, all the procedural safeguards, consequences, and effects thereto associated with a criminal proceeding under CrPC are also attracted to it.
Judgments cited or involved
* Sanjeev Kapoor vs. Chandana Kapoor and Others (2020) 13 SCC 172
* Ganesh Patel vs. Umakant Rajoria 2022 SCC OnLine SC 2050
* Grindlays Bank Ltd. vs. Central Government Industrial Tribunal and Others 1980 Supp SCC 420
* State of Kerala vs. M.M. Manikantan Nair (2001) 4 SCC 752
* Hari Singh Mann vs. Harbhajan Singh Bajwa and Others (2001) 1 SCC 169
* Budhia Swain and Others vs. Gopinath Deb and Others (1999) 4 SCC 396
Sections and Acts
* Section 340 Criminal Procedure Code, 1973 (CrPC): This section was used for filing applications against the Appellants for prosecution of offenses of perjury. It empowers a court to determine whether a complaint should be made to a competent Magistrate for prosecution of an offense committed in relation to a court proceeding.
* Companies Act, 1956: Montreaux Resorts Private Limited (MRPL) was incorporated under this act. Section 397/398 of this act was used by Ms. Sonia Khosla to file a petition alleging oppression and mismanagement by the Bakshi Group.
* Section 195(1)(b) and 195(4) read with Section 340(1) of CrPC: These sections were invoked by Ms. Sonia Khosla for initiation of prosecution against the Bakshi group for forgery and perjury.
* Section 362 of CrPC: This section governs the power of a criminal court to review or alter its own judgment or order, explicitly stating that no court shall alter or review its judgment except for clerical or arithmetical errors. It is equivalent to Section 403 of Bhartiya Nagrik Suraksha Sanhita, 2023.
* Order XLVII of the Code of Civil Procedure, 1908: This order was used by the Khosla Group to file a review petition seeking recall of a judgment dated August 13, 2020.
* Indian Penal Code (45 of 1860): All offenses under this code are to be investigated, inquired into, tried, and otherwise dealt with according to the provisions of the CrPC.
* Section 4 of CrPC: This section provides for the scope of the CrPC, mandating that all offenses under the Indian Penal Code be dealt with according to its provisions.
* Section 2(g) of CrPC: This section defines “inquiry” as every inquiry, other than a trial, conducted under the CrPC by a Magistrate or Court.
Party
Vikram Bakshi and Others versus R.P. Khosla and Another – Criminal Appeal No. of 2022 (arising from SLP (Criminal) No. 3425 of 2022) – 2025 INSC 1020 – August 20, 2025 Hon’ble Mr. Justice B. R. Gavai and Hon’ble Mr. Justice Augustine George Masih.
