High Court’s Recall of Criminal Order Set Aside; Supreme Court Reaffirms Bar on Criminal Courts Reviewing Their Judgments

A bench of Chief Justice B. R. Gavai and Justice Augustine George Masih heard the appeal arising from the Delhi High Court’s recall of its earlier order in a criminal proceeding under Section 340 CrPC. The appeal involved rival factions in a joint-venture dispute over shareholding and management of Montreaux Resorts Pvt. Ltd., and raised the question whether a criminal court may review or recall its own order outside the limited circumstances permitted by Section 362 CrPC.

The Court allowed the appeal and set aside the High Court’s order dated 05.05.2021 that had recalled its judgment of 13.08.2020. The Supreme Court held that proceedings under Section 340 CrPC were criminal in nature and governed by the CrPC; once a criminal court signed its judgment it became functus officio and could not alter or review the judgment except in the narrow exceptions recognised by law. The Court observed that the High Court’s recall did not qualify as a permissible “procedural review” because the factual ground relied upon (withdrawal of the company petition) was available to the applicants at the time of the original hearing and therefore could not be invoked later to defeat finality. The Court, in its reasoning, observed: The Court emphasised that these exceptions applied only where the ground relied upon was not available during the original proceedings and cautioned that parties could not use recall as a vehicle to undermine finality.

Background The dispute arose from a Memorandum of Understanding dated 21.12.2005 between two groups for development of a resort at Kasauli via a special purpose vehicle, Montreaux Resorts Pvt. Ltd. A share-transfer agreement of 31.03.2006 shifted majority control to the Bakshi group, but disagreements led to Company Petition No. 114 of 2007 (CP 114/2007) alleging oppression and mismanagement by the Bakshi group. Proceedings before the Company Law Board (CLB), and later the NCLT, addressed shareholding and board composition; Ms. Sonia Khosla also alleged that minutes of the AGM dated 30.09.2006 were forged and sought prosecution under Section 340 CrPC.

This Court had earlier, by consent order dated 08.05.2014, directed the CLB to decide CP 114/2007 and related Section 340 CrPC matters and recorded that the High Court should not proceed with the criminal miscellaneous petition; the High Court then dismissed related criminal applications in December 2018. In August 2020 the Delhi High Court declined to entertain Criminal Miscellaneous (Co.) No. 4 of 2019 on the ground that the matters were intrinsically linked to those pending before the NCLT and in the light of this Court’s 2014 directions; it expressly noted that "It is made clear that this Court has not expressed any view on the merits of this case." The Khosla group later filed a review under Order XLVII CPC, asserting that CP 114/2007 had been withdrawn and sought recall of the High Court’s August 2020 order. The High Court recalled its earlier order on 05.05.2021; the Bakshi group challenged that recall before the Supreme Court.

The Supreme Court found the review under Order XLVII CPC not maintainable in proceedings of a criminal character governed by CrPC and held that the High Court’s recall did not fall within permissible procedural review. The Supreme Court therefore set aside the Impugned Order dated 05.05.2021 and restored the finality of the High Court’s judgment of 13.08.2020. The appeal was allowed; pending applications stood disposed of.

Case Details: Case No.: 2025 INSC 1020 (Criminal Appeal @ SLP (Crl.) No. 3425 of 2022) Case Title: Vikram Bakshi and Others v. R.P. Khosla and Another Appearances: For the Petitioner(s): Advocates not specified in the reported judgment For the Respondent(s): Advocates not specified in the reported judgment