Subsequent Judgment Overruling Earlier Judgment Applies Retrospectively Unless Stated Otherwise : Supreme Court

The Supreme Court today (April 17) observed that when a previous judgment is overruled by a subsequent one, the later judgment operates retrospectively, as it clarifies the correct legal position that may have been misunderstood due to the earlier ruling.

“Therefore, 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. In other words, if in a given situation an earlier decision of the court operated for quite some time and it is overruled by a subsequent decision, the decision rendered subsequently would have retrospective effect and would serve to clarify the legal position which was not clearly understood earlier. Any transaction would then be covered by the law declared by the overruling decision. The overruling is generally retrospective with the only caveat being that matters that are res judicatae or accounts that have been settled in the meantime would not be disturbed.”, the court observed.

The Court noted that when an earlier precedent is overruled, it does not amount to laying down a new law; rather, the Court is merely interpreting the law correctly or refining the existing law to better reflect the true intent and objective envisioned by the legislature.

“This conclusion also stems from the rationale that the duty of the court is not to “pronounce a new law but to maintain and expound the old one”. The judge rather than being the creator of the law, is only its discoverer.”, the court said.

Further, the Court clarified that the later judgment could be a prospectively overruling judgment if it is expressly mentioned in the judgment otherwise, the judgment would operate retrospectively.

“the doctrine of prospective overruling must be exercised in explicit terms and therefore, the law declared by this Court would have a retrospective effect unless stated otherwise.”, the court said.

The bench comprising Justices JB Pardiwala and Manoj Misra was hearing the case concerning the NDPS Act, where it considered the question of whether "Buprenorphine Hydrochloride" (a psychotropic substance listed in the NDPS Schedule but not in the NDPS Rules) falls under the NDPS Act's purview to convict the accused.

In this regard, the ruling in State of Uttranchal v. Rajesh Kumar Gupta, (2007) 1 SCC 355 held that substances not listed in the NDPS Rules (Schedule I) but listed in the NDPS Schedule cannot be prosecuted under the NDPS Act.

Later on, the decision in Union of India & Anr. Vs. Sanjeev V. Deshpande, 2014 13 SCC 1 overruled Rajesh Kumar Gupta's judgment holding that all substances in the NDPS Schedule are prosecutable under the NDPS Act, regardless of their omission in the Rules.

In Sanjeev V. Deshpande's case, it was not expressly stated that the judgment is prospectively overruled, making it retrospectively applicable.

The Trial Court deleted the charges labeled against the Respondents-accused under the NDPS Act in an application filed under section 216 Cr.P.C., which only meant to add or alter the existing charges, relying on Rajesh Kumar Gupta's ruling.

Following the High Court's approval of the trial court's decision, the Department of Revenue Intelligence approached the Supreme Court.

Setting aside the impugned findings, the judgment authored by Justice Pardiwala held that once the ruling in Rajesh Kumar Gupta was effectively overruled by the decision in Sanjeev V. Deshpande, and the absence of any declaration of prospective application, the latter would prevail and be treated as the correct interpretation of the law from the outset.

Doctrine of Prospective Overruling Cannot Be Applied in Routine Manner

“Therefore, it is clear as a noon day that the invocation of the doctrine of prospective overruling or the attribution of prospectivity to a decision must not be resorted to in a routine manner without the Court satisfying itself that the circumstances demand such a solution, both to do complete justice to the matter at hand and also to reorient the law in the right direction without creating widespread chaos and disruption. By employing the doctrine of prospective overruling, the matter pending before different forums would still be governed under the old law or the overruled decision. In simpler words, the pending cases would not be affected by the new declaration of law. In the absence of this the Court applying this doctrine, all pending matters and future cases would automatically and inescapably be governed by the law declared in the overruling decision. In certain situations, it might be preferable on a holistic consideration of several competing interests and factors to invoke the doctrine of prospective overruling and therefore, it could be said that the ambit of the doctrine is co-extensive with the equity of a situation to prevent the intrusion into matters which have already been settled or have attained finality. The principle involves giving effect to the new law laid down from a prospective date, ordinarily from the date of the judgement of the overruling decision.”, the court observed.

Also From Judgment: Charges Framed Cannot Be Deleted Invoking S.216 CrPC/S.239 BNSS : Supreme Court

Case Title: DIRECTORATE OF REVENUE INTELLIGENCE VERSUS RAJ KUMAR ARORA & ORS.

Citation : 2025 LiveLaw (SC) 434

Click here to read/download the judgment

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.