SC's 2024 Order Allowing Union To Seek Review Of Benami Act Cases Decided Relying On 'Ganpati Dealcom' Wrong : Supreme Court

Observing that a subsequent overruling of a precedent is not a ground to seek review, the Supreme Court recently dismissed a petition filed by the Union Government seeking review of an order passed on the basis of the 2022 judgment in Ganpati Dealcom which struck down certain provisions of the Benami Transactions (Prohibition) Act 1988.The 2022 judgment was later recalled in review by a 3-judge bench in October 2024 in the case Union of India v. M/s Ganpati Dealcom Pvt. Ltd.(R.P.(C) No. 359/2023). While allowing the review in 2024, a bench led by the then Chief Justice of India, DY Chandrachud, had also granted liberty to the Union to seek review of the earlier cases decided on the basis of the 2022 precedent.On the strength of this liberty, the Union filed a petition to review an order passed in April 2024 which had dismissed the Union's petition against a Gujarat High Court's judgment quashing the attachment under the Benami Act against the respondent. The High Court had relied on the 2022 judgment in Ganpati Dealcom.The present review was listed before a bench of Justices BV Nagarathna and Augustine George Masih which disagreed with the 2024 order in Ganpati Dealcom to the extent it granted liberty to seek review where earlier cases were decided on an overruled legal principle. The bench observed that this observation ran contrary to an earlier coordinate bench decision in Government of NCT of Delhi v. KL Rathi Steels Ltd. In KL Rathi Steels, the Court had categorically held that a subsequent change in law is not a valid ground for review.Invoking the Explanation to Rule 1 of Order XLVII of the CPC, which states: "The fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the subsequent decision of a superior Court in any other case, shall not be a ground for the review of such judgment.", the court expressed its inability to agree with the ratio laid down in Ganpati Dealcom's stating that “a three-Judge Bench of this Court has failed to notice the judgment of this Court in KL Rathi Steels Limited (supra) which is also of a co-equal strength and prior in time. Therefore, following the judgment of this Court in KL Rathi Steels Limited (supra), we decline to grant liberty to seek review in the present case. Hence, the review petition is dismissed.” In KL Rathi, it was held : "We, thus, hold that no review is available upon a change or reversal of a proposition of law by a superior court or by a larger Bench of this Court overruling its earlier exposition of law whereon the judgment/order under review was based." Cause Title: UNION OF INDIA & ORS. VERSUS VIRENDRA AMRUTBHAI PATELCitation : 2025 LiveLaw (SC) 1107Click here to download order

SC's 2024 Order Allowing Union To Seek Review Of Benami Act Cases Decided Relying On 'Ganpati Dealcom' Wrong : Supreme Court

Yash Mittal

Subsequent overruling of a precedent is not a ground to review, the Court said.

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