/22022 INSC 0825/ REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 8486 OF 2011 M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIRECTOR SHRI PRADEEP KUMAR AGRAWAL                 APPELLANT (S) VERSUS GOVERNMENT OF N.C.T. OF DELHI THROUGH  ITS PRINCIPAL SECRETARY (FINANCE) & ORS.       RESPONDENT (S) WITH CIVIL APPEAL NO. 8485/2011 CIVIL APPEAL NO. 8487/2011 CIVIL APPEAL NO. 8496­8501/2011 CIVIL APPEAL NO. 8502/2011 CIVIL APPEAL NO. 8617/2014 CIVIL APPEAL NO. 10374­10379/2014 CIVIL APPEAL NO. 8488/2011 CIVIL APPEAL NO. 8491­8494/2011 CIVIL APPEAL NO. 8495/2011 SPECIAL LEAVE PETITION (C) No. 33322/2017 J U D G M E N T INDIRA BANERJEE J. 1. The main question raised in this batch of appeals is, whether, ‘Pan Masala’,   which   contains   tobacco   and   gutka,   covered   by   an   Entry   in   the First   Schedule   to   the   Additional   Duties   of   Excise   (Goods   of   Special 1 Importance) Act 1957, hereinafter referred to as the ‘ADE Act’, are taxable by the State under the Delhi Sales Tax Act 1975 and/or the Uttar Pradesh Trade Tax Act 1948 and/or the Tamil Nadu General Sales Tax Act, 1959.  2. In   Shanti   Fragrances   v.   Union   of   India   and   others 1 ,   a   Division Bench of this Court observed:­ 12.   It   does   appear   that   there   is   a   direct   conflict   between   Kothari Products   [ Kothari   Products   Ltd.   v.   State   of   A.P. ,   (2000)   9   SCC 263],   Radheshyam   Gudakhu   Factory   [ State   of   Orissa   v.   Radheshyam Gudakhu   Factory ,   (2018)   11   SCC   505   :   (1988)   68   STC   92   (SC)] and   Reliance   Trading   Co.   [ Reliance   Trading   Co.   v.   State   of   Kerala , (2011)   15   SCC   762]   judgments   on   the   one   hand,   and   Agra   Belting Works   [ CST   v.   Agra   Belting   Works ,   (1987)   3   SCC   140   :   1987   SCC (Tax)  233] ,  which was also followed by  two other judgments, on the other.   We   may   hasten   to   add   that   there   are   three­Judge   Bench decisions on both sides.  ...” 3. The Bench further observed:­ “13.   …   One   other   interesting   feature   of   this   case   is   whether,   after Union of India v. Raghubir Singh 2 , SCR at pp. 335­37 : SCC pp. 777­ 78, para 27, it can be stated that Judges of this Court do not sit in 2s and 3s for mere convenience, but that a Bench  which is numerically superior will prevail over a Bench of lesser strength. If the doctrine of precedent,   as   applied   by   this   Court,   is   to   be   a   matter   of   numbers, then,   interestingly   enough,   as   has   been   held   by   Beaumont,   C.J.   in Ningappa Ramappa Kurbar v. Emperor 3 , the position in law could be as under: (AIR p. 409 : SCC OnLine Bom) “… The   Court   in   that   case   consisted   of   five   Judges,   one   of   whom, Shah, J., dissented from that proposition. The authority of the case may be open to question, since there had been a previous decision of   a   Full   Bench   of   this   Court   of   four   Judges   in   Queen Empress   v.   Mugappa   Bin   Ningapa   [Queen   Empress   v.   Mugappa Bin   Ningapa,   ILR   (1893)   18   Bom   377]   ,   which   had   reached   a different conclusion. Apparently it was considered that five Judges, by a majority of four to one, could overrule a unanimous decision of four   Judges,   the   net   result   being   that   the   opinion   of   four   Judges prevailed over the opinion of five Judges of co­ordinate jurisdiction. There   seems   to   be   very   little   authority   on   the   powers   and constitution   of   a   Full   Bench.   There   can   be   no   doubt   that   a   Full 1 (2018) 11 SCC 305 2 (1989) 2 SCC 754; (1989) 3 SCR 316 3 1941 SCC OnLine Bom 41 : AIR 1941 Bom 408 2 Bench   can   overrule   a  Division   Bench,   and   that   a  Full   Bench   must consist   of   three   or   more   Judges;   but   it   would   seem   anomalous   to hold   that   a   later   Full   Bench   can   overrule   an   earlier   Full   Bench, merely   because   the   later   Bench   consists   of   more   Judges   than   the earlier. If that were the rule, it would mean that a Bench of seven Judges, by a majority of four to three, could overrule a unanimous decision   of   a   Bench   of   six   Judges,   though   all   the   Judges   were   of co­ordinate   jurisdiction.   In   Enatullah   v.   Kowsher Ali   [Enatullah   v.   Kowsher   Ali,   1926   SCC   OnLine   Cal   104   :   ILR (1927)   54   Cal   266]   ,   Sanderson,   C.J.,   stating   the   practice   in Calcutta,   seems   to   have   been   of   opinion   that   a   decision   of   a   Full Bench   could   only   be   reversed   by   the   Privy   Council   or   by   a   Bench specially   constituted   by   the   Chief   Justice.   Even   if   this   be   the   true rule,   there   is   nothing   to   show   that   the   Chief   Justice   acted   upon   it in   Emperor   v.   Purshottam   Ishwar   Amin   [Emperor   v.   Purshottam Ishwar Amin, 1920 SCC OnLine Bom 144 : ILR (1921) 45 Bom 834] . I do not recollect myself ever to have constituted a Special Bench to   consider   the   ruling   of   a   Full   Bench,   though   I   have   constituted many   Full   Benches   to   consider   rulings   of   Division   Benches. However,   I   need   not   pursue   this   subject   further,   since,   for   the purpose   of   the   present   appeal,   I   am   prepared   to   assume   that   an alternative charge of perjury lies, and that it was a charge of that nature which the learned Additional Sessions Judge contemplated. The   question   then   is   whether   it   is   expedient   in   the   interests   of justice that such a charge should be made.” 14.   This conundrum was also addressed by M.B. Lokur, J. in   Supreme Court   Advocates­on­Record   Assn.   v.   Union   of   India   [ Supreme   Court Advocates­on­Record   Assn.   v.   Union   of   India ,   (2016)   5   SCC   1]   ,   as follows: (SCC pp. 577­78, para 669) “669.   One   of   the   more   interesting   aspects   of   Pradeep   Kumar Biswas   [Pradeep   Kumar   Biswas   v.   Indian   Institute   of   Chemical Biology, (2002) 5 SCC 111 : 2002 SCC (L&S) 633] is that out of the   7   (seven)   learned   Judges   constituting   the   Bench,   5   learned Judges   overruled   the   unanimous   decision   of   another   set   of   5 learned Judges in   Sabhajit Tewary   [Sabhajit Tewary   v.   Union of India,   (1975)   1   SCC   485   :   1975   SCC   (L&S)   99]   .   Two   of   the learned   Judges   in   Pradeep   Kumar   Biswas   [Pradeep   Kumar Biswas   v.   Indian   Institute   of   Chemical   Biology,   (2002)   5   SCC 111   :   2002   SCC   (L&S)   633]   found   that   Sabhajit Tewary   [Sabhajit   Tewary   v.   Union   of  India,   (1975)   1   SCC   485   : 1975 SCC (L&S) 99] had been correctly decided. In other words, while   a   total   of   7   learned   Judges   took   a   particular   view   on   an issue of fact and law, that view was found to be incorrect by 5 learned   Judges,   whose   decision   actually   holds   the   field   today. Is the weight of numbers irrelevant? Is it that only the numbers in   a   subsequent   Bench   are   what   really   matters?   What   would have   been   the   position   if   only   4   learned   Judges   in   Pradeep Kumar   Biswas   [Pradeep   Kumar   Biswas   v.   Indian   Institute   of Chemical Biology, (2002) 5 SCC 111 : 2002 SCC (L&S) 633] had decided   to   overrule   Sabhajit   Tewary   [Sabhajit   Tewary   v.   Union 3 of   India,   (1975)   1   SCC   485   :   1975   SCC   (L&S)   99]   while   the remaining   3   learned   Judges   found   no   error   in   that   decision? Would   a   decision   rendered   unanimously   by   a   Bench   of   5 learned   Judges   stand   overruled   by   the   decision   of   4   learned Judges   in   a   subsequent   Bench   of   7   learned   Judges?   Pradeep Kumar   Biswas   [Pradeep   Kumar   Biswas   v.   Indian   Institute   of Chemical   Biology,   (2002)   5   SCC   111   :   2002   SCC   (L&S)   633] presents   a   rather   anomalous   situation   which   needs   to   be addressed by appropriate rules of procedure. If this anomaly is perpetuated   then   the   unanimous   decision   of   9   learned   Judges in   Third   Judges   case   [Special   Reference   No.   1   of   1998,   In   re, (1998)   7   SCC   739]   can   be   overruled   (as   sought   by   the   learned Attorney General) by 6 learned Judges in a Bench of 11 learned Judges, with 5 of them taking a different view, bringing the total tally of Judges having one view to 14 and having another view to 6,  with  the view  of the  6  learned Judges  being taken  as  the law!” 15.     It   may   be   pointed   out   that   in   the   present   case,   if   numbers   are totted   up,   the   Kothari   Products   [ Kothari   Products   Ltd.   v.   State   of   A.P. , (2000)   9   SCC   263]   line,   as   followed   in   Radheshyam   Gudakhu Factory   [ State   of   Orissa   v.   Radheshyam   Gudakhu   Factory ,   (2018)   11 SCC   505   :   (1988)   68   STC   92   (SC)]   and   Reliance   Trading   Co.   [ Reliance Trading Co.   v.   State of Kerala , (2011) 15 SCC 762]  , will  go to a Bench strength,   numerically   speaking,   of   eight   learned   Judges,   as   against the   Agra Belting Works   [ CST   v.   Agra Belting Works , (1987)  3 SCC 140 : 1987 SCC (Tax) 233] line, which goes up to a numerical strength of six learned   Judges.   If   the   dissenting   judgment   of   B.C.   Ray,   J.   is   to   be added   to   the   Kothari   Products   [ Kothari   Products   Ltd.   v.   State   of   A.P. , (2000) 9 SCC 263] line, then we have a numerical strength of 9:6. The question of numerical strength gains poignancy when one judgment is overruled   by   another,   as   has   been   pointed   by   Beaumont,   C.J. in   Ningappa   Ramappa   Kurbar   [ Ningappa   Ramappa   Kurbar   v.   Emperor , 1941   SCC   OnLine   Bom   41   :   AIR   1941   Bom   408]   ,   and   by   Lokur,   J. in   Supreme Court Advocates­on­Record Assn.   [ Supreme Court Advocates­ on­Record Assn.   v.   Union of India , (2016) 5 SCC 1]” 4. The   two­Judge   Bench,   referred   to   the   Constitution   Bench,   the following questions: i) Whether   the   Kothari   Products   Ltd.   v.   State   of   A.P. 4   line   of judgments or the   Central Sales Tax vs. Agra Belting Work 5 , line of judgments is correct in law; and 4 (2000) 9 SCC 263 5 (1987) 3 SCC 140 4 ii) What   should   be   the   proper   guidelines   for   the   future   for   overruling an   earlier   decision   of   this   Court,   and   to   what   extent   should   the Courts   be   guided   by   the   propositions   in   Ningappa   Ramappa Kurbar   v.   Emperor 6 ,   the   observations   of   Lokur,   J.   in   Supreme Court   Advocates­on­Record   Assn.   v   Union   of   India 7   and   the judgment   of   the   Court   of   Appeal   in   Harper   v.   National   Coal Board 8 .  5. The ADE Act has been enacted to provide for the levy and collection of   additional   duties   of   excise   in   respect   of   certain   goods,   over   and   above the   duties   of   excise   levied   under   the   Central   Excise   Act   1944.     The Statement of Objects of the ADE Act reads:­ “The object of the Bill is to impose additional duties of excise in replacement  of  the  sales  taxes  levied   by   the   Union   and  States  on sugar,   tobacco   and   mill­made   textiles   and   to   distribute   the   net proceeds of these taxes, except the proceeds attributable to Union Territories,   to   the   States.     The   distribution   of   the   proceeds   of   the additional duties broadly follows the pattern recommended by the Second   Finance   Commission.     Provision   has   been   made   that   the States   which   levy   a   tax   on   the   sale   or   purchase   of   these commodities after 1.4.1958 do not participate in the distribution of the   net   proceeds.     Provision   is   also   being   made   in   the   Bill   for including these three goods in the category of goods declared to be of   special   importance   in   inter­State   trade   or   commerce   so   that, following   the   imposition   of   uniform   duties   of   excise   on   them,   the rates of sales tax if levied by any State are subject from 1.4.1958 to the restrictions in Section 15 of the Central Sales Tax Act, 1956 .” 6. In  Mahalakshmi Oil Mills v. State of A.P. 9 , this Court, held:­ “5   ..   In   short,   the   object   of   the   Act   was   to   substitute   additional duties   of   excise   in   place   of   sales   tax   so   far   as   these   goods   were concerned.     Since   the   State   legislatures   were   at   liberty,   if   they wished,   to   levy   taxes   on   the   sale   or   purchase   of   these 6 1941 SCC Online Bom 41 : Air m1941 Bom 408 7 (2016) 5 SCC 1 8 [1974] QB 614 9 (1989) 1 SCC 164 5 commodities, the Act provided that the additional excise duties will be distributed only among such States as did not levy a tax on the sale   or   purchase   of   these   commodities.     Also,   by   including   these goods in the category of goods declared to be of special importance in   inter­State   trade   or   commerce,   the   legislation   ensured   that,   if any   State   levied   sales   tax   in   respect   of   these   commodities,   such levy was subject to the restrictions contained in the Central Sales Tax Act, 1956.” 7. It is well settled that once goods are chargeable under the ADE Act, the   State   cannot   levy   sales   tax   on   the   same   goods   under   a   State enactment.  In  Godfrey Phillips India Ltd. v. State of U.P 10 . , this Court held:­ “70.  So even if tobacco is an article of luxury, a tax on its supply is within   the   exclusive   competence   of   the   State   but   subject   to   the constitutional   curbs   prescribed   under   Article   286   read   with Sections   14   ad   15   of   the   Central   Sales   Tax   Act,   1956   and   most importantly the ADE Act of 1957 under which no sales tax can be levied on tobacco at all if the State was to take the benefits under that Act.” 8. In  Kothari Products Ltd.  (supra) , the question was, ‘tobacco’ being specified  in  the  First  Schedule  to  the  ADE  Act, and  exempted from  Sales Tax under  Section  8 of  the  Andhra  Pradesh  General  Sales  Tax Act  1957, whether ‘gutka’ could be taxed by the State of Andhra Pradesh.  The Court found   that   “gutka”   being   tobacco,   covered   by   an   Entry   in   the   First Schedule to the ADE Act and liable to be taxed under the ADE Act, it was covered   by   the   exemption   in   Section   8   of   the   Andhra   Pradesh   General Sales   Tax   Act   .     The   State   Act   could   not   have   been   amended   to   tax “gutka”.  10 (2005) 2 SCC 515 6 9. There   is   a   line   of   decisions   of   this   Court,   taking   the   same   view   as Kothari   Products   Ltd.   (supra)   and   holding   that   items   covered   by   the expression ‘tobacco’ and other items included in the First Schedule to the ADE Act are not taxable by the State.  10. In   the   State   of   Orrisa   vs.   Radhey   Shyam   Gudakhu   Factory 11 , the  issue   was  whether   Gudakhu   was  covered  by   the   expression  ‘tobacco’ as   defined   in   Section   2(c)   of   ADE   Act.     Following   the   decision   of   the Calcutta   High   Court   in   Gulabchand   Harekchand   v.   State   of   West Bengal 12 ,   this   Court   held   that   Gudakhu   is   a   product   of   ‘tobacco’   and hence, a product which falls within the exemption covered by S. No. 35 of the Schedule to the Orissa Sales Tax Act 1947.   11. In   Reliance Trading Company, Kerala v. State of Kerala 13 , this Court took the view that cotton based tarpaulin was exempted from Sales Tax under the Kerala General Sales Tax Act, 1963, since it was exigible to Additional Excise Duty under the First Schedule of  the ADE Act.   12. In  Agra Belting Works  (supra) , the question was whether any class of goods – cotton fabrics of all kinds, to be specific, exempted from Sales Tax Act under  section 4 of the Uttar Pradesh Sales Tax Act, 1948, would be   exigible   to   Sales   Tax   by   virtue   of   a   subsequent   Notification   under 11 (2018) 11 SCC 505 12 1984 SCC Online Cal 274 13 (2011) 15 SCC 762 7 Section 3­A of the said Act, specifying the rate of sales tax in respect of an item of the class of goods exempted under Section 4, without withdrawing the   earlier   Notification   under   Section   4.       While   the   majority   held   that   a Notification   of   recall   of   exemption   was   not   a   condition   precedent   for imposition   of   tax,   by   a   valid   Notification   under   Section   3­A,   B.C.Ray,   J. dissented with the view of the majority.  13. In   Agra   Belting   Works   (supra) ,   the   majority   of   the   three­Judge Bench of this Court, by ratio of 2:1,  inter alia , held:­ “6 .   As   has   been   pointed   out   above,   Section   3   is   the   charging provision;   Section   3­A   authorises   variation   of   the   rate   of   tax   and Section  4 provides for exemption from tax. All the three sections are parts   of   the   taxing   scheme  incorporated  in   the  Act   and  the  power both   under   Section   3­A   as   also   under   Section   4   is   exercisable   by the State Government only. When after a notification under Section 4 granting exemption from liability, a subsequent notification under Section   3­A   prescribes   the  rate   of  tax,   it   is  beyond  doubt  that   the intention is to withdraw the exemption and make the sale liable to tax at the rate prescribed in the notification. As the power both for the grant of exemption and the variation of the rate of tax vests in the   State   Government   and   it   is   not   the   requirement   of   the   statute that a notification of recall of exemption is a condition precedent to imposing   tax   at   any   prescribed   rate   by   a   valid   notification   under Section   3­A,   we   see   no   force   in   the   contention   of   the   assessee which   has   been   upheld   by   the   High   Court.   In   fact,   the   second notification can easily be treated as a combined notification — both for   withdrawal   of   exemption   and   also   for   providing   higher   tax. When   power   for   both   the   operations   vests   in   the   State   and   the intention   to   levy   the   tax   is   clear   we   see   no   justification   for   not giving   effect   to   the  second   notification.   We  would   like  to   point   out that the exemption was in regard to a class of goods and while the exemption   continues,   a   specific   item   has  now   been   notified   under Section 3­A of the Act.” 14. B.C. Ray, J. dissenting with the majority view, held:­  “ 14 .   The  next  question   for   consideration   is  what  is  the   effect  of  a notification under Section 3­A including an item in the Schedule for 8 imposition   of   sales   tax   though   there   is   a   general   exemption   from sales tax under Section 4 of the Sales Tax Act.  … 15.   A   similar   question   also   arose   in   the   case   of   CST   v.   Rita   Ice Cream   Co.,   Gorakhpur   [1981   UPTC   1239   (DB)(All   HC)]   and   it   was held   that   so   long   as   the   general   exemption   under   Section   4 continues a particular item notified under Section 3­A of Sales Tax Act cannot be taxed. 16.   On   a   conspectus   of   all   these   decisions   aforesaid,   the   only irresistible inference follows that so long as the general exemption granted   under   Section   4   with   regard   to   cotton   fabrics   of   all   kinds continues   no   sales   tax   can   be   imposed   on   beltings   of   all   kinds which   fall   within   the   cotton   fabrics   of   all   kinds   and   the   general exemption   under   Section   4   will   prevail   over   the   notification   made under Section 3­A of the Sales Tax Act. I am unable to subscribe to the   view   that   since   the   notification   under   Section   3­A   of   the   U.P. Sales Tax Act has been made subsequent to the notification issued under  Section 4  of the said Act,  the subsequent notification  under Section   3­A   will  prevail   over   the  general   exemption   granted  under Section 4 of the said Act. In my considered opinion the reasonings and conclusions arrived at by the High Court are unexceptionable.” 15. In   Sales   Tax   Officer,   Sector­IX,   Kanpur   vs.     Dealing   Dairy Products   and   Anr. 14 ,   a   two   Judge   Bench   of   this   Court   followed   the majority   decision   in   Agra   Belting   Works   (supra),   and   held   that,   even though   the   State   of   Uttar   Pradesh   had   been   issuing   notifications   under Section   4   of   the   U.P.   Sales   Tax   Act   1948,   exempting   milk   and   milk products   from   levy   of   sales   tax,   a   later   notification   under   Section   3­A notifying   the  rate  of   tax  on  ice­cream   amongst   other   items,  withdrew   the exemption  in  respect   of   all  kinds   of  ice­cream   and  made  the  sale   of    ice­ cream   exigible   to   sales   tax   at   the   rate   specified   in   the   Notification   under Section 3A.   14 (1994) Supp. 2 SCC 639 9 16. In   State   of   Bihar   and   Others   v.   Krishna   Kumar   Kabra   and Another 15 , a two Judge Bench of this Court referred to and followed  Agra Belting   Works   (supra)   and   Dealing   Dairy   Products   (supra)   and   held that   Sections   3­A   and  4   of   the   U.P.   Sales   Tax   Act   were   parts   of   a   taxing scheme incorporated in that Act and therefore, where the notification was issued under Section 3­A prescribing the rate of tax on goods, which had been exempted from tax under Section 4, by an earlier notification, it had to   be   held   that   the   later   notification   was   intended   to   withdraw   the exemption and make the sale leviable to tax at the rate prescribed in the later notification. 17. In our considered opinion there is no conflict between the   Kothari Products   (supra)   line   of   cases   and   the   Agra   Belting   line   of   cases.     The Kothari   Products   (supra)   line   of   cases   was   on   the   question   of   whether “tobacco”   or   other   goods   specified   in   the   First   Schedule   to   the   ADE   Act and   hence   exempted   from   Sales   Tax   under   State   sales   tax   enactments, can be made exigible to tax under the State enactments by amending the Schedule thereto.  On the other hand,  Agra Belting Works  (supra)  line of cases   was   on   the   question   of   interplay   between   general   exemption   of specified   goods   from   sales   tax   under   Section   4   of   the   U.P.   Sales   Tax   Act and   specification   of   rates   of   sales   tax   under   Section   3­A   of   the   said   Act. This   Court   held   that   goods   exempted   from   sales   tax   under   Section   4 would be exigible to tax by virtue of subsequent notification under Section 3­A   specifying   the   rate   of   sales   tax   for   any   specific   item   of   the   class   of 15 (1997) 9 SCC 763 10 goods   earlier   exempted   under   Section   4.       There   being   no   conflict,   the reference to Constitution Bench is incompetent.  The cases may be placed for decision before the regular Bench.  18. The   second   question   is   answered   by   the   judgment   of   the Constitution   Bench   of   this   Court   in   Dr.   Jaishri   Laxmanrao   Patil       v. The   Chief   Minister   and   Others. 16 .     The   Constitution   Bench   speaking through Bhat, J. held:­  “10.   A careful reading of the judgments in   Indra Sawhney   v.   Union of   India   [Indra   Sawhney   v.   Union   of   India,   1992   Supp   (3)   SCC 217   :   1992   SCC   (L&S)   Supp   1]   ,   clarifies   that   seven   out   of   nine Judges   concurred   that   there   exists   a   quantitative   limit   on reservation—spelt   out   at   50%.   In   the   opinion   of   four   Judges, therefore,   per   the   judgment   of   B.P.   Jeevan   Reddy,   J.,   this   limit could   be   exceeded   under   extraordinary   circumstances   and   in conditions for which separate justification has to be forthcoming by the State or the agency concerned. However,   there is unanimity in the   conclusion   by   all   seven   Judges   that   an   outer   limit   for reservation   should   be   50%.   Undoubtedly,   the   other   two   Judges, Ratnavel Pandian and P.B. Sawant, JJ. indicated that there is no general   rule   of   50%   limit   on   reservation.   In   these   circumstances, given   the   general   common   agreement   about   the   existence   of   an outer limit i.e. 50%, the petitioner's argument about the incoherence or   uncertainty   about   the   existence   of   the   rule   or   that   there   were contrary observations with respect to absence of any ceiling limit in other   judgments   (the  dissenting   judgments  of   K.   Subba   Rao,   in   T. Devadasan   v.   Union   of   India   [T.   Devadasan   v.   Union   of   India, (1964) 4 SCR 680 : AIR 1964 SC 179] , the judgments of S.M. Fazal Ali   and   Krishna   Iyer,   JJ.   in   State   of   Kerala   v.   N.M.   Thomas   [State of   Kerala   v.   N.M.   Thomas,   (1976)   2   SCC   310   :   1976   SCC   (L&S) 227]   and   the   judgment   of   Chinnappa   Reddy,   J.   in   K.C.   Vasanth Kumar   v.   State   of   Karnataka   [K.C.   Vasanth   Kumar   v.   State   of Karnataka, 1985 Supp SCC 714 : 1985 Supp (1) SCR 352] ) is not an   argument   compelling   a   review   or   reconsideration   of   Indra Sawhney   [Indra   Sawhney   v.   Union   of   India,   1992   Supp   (3)   SCC 217 : 1992 SCC (L&S) Supp 1] rule. 11.   The respondents had urged that discordant voices in different subjects   (Devadasan   [T.   Devadasan   v.   Union   of   India,   (1964)   4 SCR 680 : AIR 1964 SC 179] ,   N.M. Thomas   [State of Kerala   v.   N.M. Thomas,   (1976)   2   SCC   310   :   1976   SCC   (L&S)   227]   and   Indra 16 (2021) 8 SCC 1 11 Sawhney   [Indra   Sawhney   v.   Union   of   India,   1992   Supp   (3)   SCC 217   :   1992   SCC   (L&S)   Supp   1]   )   should   lead   to   re­examination   of the   ratio   in   Indra Sawhney   [Indra Sawhney   v.   Union of India, 1992 Supp (3) SCC 217 : 1992 SCC (L&S) Supp 1] . It would be useful to notice   that   unanimity   in   a   given   Bench   (termed   as   a   “super majority”) — denoting a 5 : 0 unanimous decision in a Constitution Bench cannot be construed as per se a strong or compelling reason to doubt the legitimacy of a larger Bench ruling that might contain a narrow majority (say, for instance with a 4 : 3 vote, resulting in overruling   of   a   previous   unanimous   precedent).   The   principle   of stare decisis operates both vertically — in the sense that decisions of   appellate   courts   in   the   superior   in   vertical   hierarchy,   bind tribunals and courts lower in the hierarchy, and horizontally — in the   sense   that   a   larger   Bench   formation   ruling,   would   be   binding and prevail upon the ruling of a smaller Bench formation. The logic in   this   stems   from   the   raison   d'être   for   the   doctrine   of   precedents i.e.   stability   in   the  law.   If   this  rule  were  to   be   departed  from   and the   legitimacy   of   a   subsequent   larger   Bench   ruling   were   to   be doubted   on   the   ground   that   it   comprises   of   either   plurality   of opinions or a narrow majority as compared with a previous Bench ruling (which might be either unanimous or of a larger majority, but of   lower   Bench   strength),   there   would   be   uncertainty   and   lack   of clarity   in   the   realm   of   precedential   certainty.   If   precedential legitimacy of a larger Bench ruling were thus to be doubted, there are no rules to guide the courts' hierarchy or even later Benches of the   same   court   about   which   is   the   appropriate   reading   to   be adopted   (such   as   for   instance,   the   number   of   previous   judgments to   be   considered   for   determining   the   majority,   and   consequently the   correct law). 12.   In view of the above reasoning, it is held that the existence of a plurality   of   opinions   or   discordant   or   dissident   judgments   in   the past   —   which   might   even   have   led   to   a   majority   (on   an   overall headcount) supporting a particular rule in a particular case cannot detract   from   the   legitimacy   of   a   rule   enunciated   by   a   later,   larger Bench,   such   as   the   nine­Judge   Bench   ruling   in   Indra Sawhney   [Indra   Sawhney   v.   Union   of   India,   1992   Supp   (3)   SCC 217 : 1992 SCC (L&S) Supp 1] .” 19. The view of Bhat, J. was expressly concurred by Rao, J. (Para 196) and   Gupta,   J.   (Para   227).     There   was   no   dissent   to   the   view.     In   view   of Article 145(5) of the Constitution of India concurrence of a majority of the judges   at  the   hearing  will  be   considered   as  a   judgment  or   opinion   of   the Court.  It is settled that the majority decision of a Bench of larger strength 12 would prevail over the decision of a Bench of lesser strength, irrespective of the number of Judges constituting the majority.  20. In   view   of   the   five­Judge   Bench   decision   in   Dr.   Jaishri   Laxman Rao (supra) , it is not necessary for this Court to answer the question. ….……………………………………. J. [INDIRA BANERJEE]      ………..……………………………… J. [SURYA KANT]    ………..……………………………… J.          [M.M. SUNDRESH]      ………..……………………………… J. [SUDHANSHU DHULIA] NEW DELHI; SEPTEMBER 19, 2022 13 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 8486 OF 2011 M/S TRIMURTHI FRAGRANCES (P) LTD. THROUGH ITS DIRECTOR SHRI PRADEEP KUMAR AGRAWAL .....APPELLANT(S) VERSUS GOVT OF N.C.T OF DELHI THROUGH ITS PRINCIPAL SECRETARY (FINANCE) & ORS. .....RESPONDENT(S) W I T H CIVIL APPEAL NO. 8485 OF 2011 CIVIL APPEAL NO. 8487/2011 CIVIL APPEAL NOS. 8496-8501/2011 CIVIL APPEAL NO. 8502/2011 CIVIL APPEAL NO. 8617/2014 CIVIL APPEAL NOS. 10374-10379/2014 CIVIL APPEAL NO. 8488/2011 CIVIL APPEAL NOS. 8491-8494/2011 1 CIVIL APPEAL NO. 8495/2011 SLP(C) NO. 33322/2017 J U D G M E N T HEMANT GUPTA, J. A. I entirely agree with the judgment authored by Hon. Indira Banerjee J. However, in respect of Question No.2, I would like to supplement the opinion expressed. B. Mr. Gopal Sankaranarayanan, learned Senior Advocate referred to Article 145(5) of the Constitution to contend that a judgment of this Court is mandated to be delivered with the concurrence of a majority of the Judges present at the hearing of the case, but nothing in this clause shall be deemed to prevent a Judge who does not concur from delivering a dissenting judgment or opinion. Thus, the Constitution itself envisaged that the judgment is by the majority of the Judges. C. A reference was made to insertion of Article 144A in the Constitution by the 42 nd Amendment with effect from 01.02.1977. The amendment reads thus: “144-A. Special provisions as to disposal of questions relating to constitutional validity of laws – (1) The minimum number of Judges of the Supreme Court who shall sit for the purpose of determining any question as to the constitutional validity of any Central law or State law shall be seven. A. A Central law or a State law shall not be declared to be constitutionally invalid by the Supreme Court unless a majority of not less than two-thirds of the Judges sitting for the purpose of determining the question as to the constitutional validity of such law hold it to be constitutionally invalid.” 2 D. The said amendment was undone by 43 rd Amendment when Article 144-A was omitted with effect on and from 01.02.1977. Though the said insertion of Article 144-A stands repealed, but it shows that the legislature also considered majority of not less than 2/3 rd of Judges should determine the question as to the constitutional validity of law. Therefore, even such amendment contemplated dissent and a minority view. E. A similar question has been examined by a Full Bench of the High Court of Gujarat in a judgment reported as State of Gujarat v GordhandasKeshavji Gandhi and Ors . 17 . The Court was considering the binding nature of the judgments of the Bombay High Court in the successor Gujarat High Court but an ancillary question was considered in respect of numerical strength of the Bench as well. Though there is divergence of opinion amongst the judges of the Court, but the minority view was relevant for the second question arising for consideration. The minority view is expressed by N.M. Miabhoy J and P.N.Bhagwati J. We are in agreement with the said view. The order passed by learned Hon’ble Mr. Justice N.M. Miabhoy J reads thus: “44. ……………The principles which guided the latter Court in the matter of judicial precedents have been set out by that Court in (1944) 1 KB 718. All Division Benches considered themselves to be bound by the judicial precedents created by Full Benches not only on the ground of judicial comity but also on the ground that a Full Bench consisted of more number of Judges than a Division Bench. If a judicial precedent created by a Full Bench required to be reconsidered, then, the usual practice was to refer the matter to a Full Bench consisting of more number of Judges than the number which constituted the former Full Bench whose decision was sought to be revised. The practice was to regard the precedent of a larger Full Bench as having greater efficacy and binding authority than the precedent of a Full Bench consisting of a smaller number of Judges. This practice was criticised by Beaumont, C.J. in 43 Bom LR 864 at p. 868 : (AIR 1941 Bom 408 at p. 409). It is not necessary to express any opinion in this case as to whether this criticism was or was not justified. However, the observations made by the learned 17 AIR 1962 Guj 128 3 Chief Justice in the above case ignores the important fact that, when a Full Bench consists of a larger number of Judges, then, the decision is not merely of a greater number of Judges, but it is one arising from out of the joint deliberations and discussions of a greater number of Judges and that this fact may give to the decision of a Full Bench consisting of a larger number of Judges a greater binding authority than that of a Full Bench consisting of a smaller number of Judges…………….. In view of the observations made by Their Lordships of the Supreme Court in the aforesaid two cases 18 , the view that should prevail in India is the view-that the decision of a larger Full Bench should be followed in preference to the decision of a smaller Full Bench. xxx xxx xxx The order passed by learned Hon’ble Mr. Justice P.N.Bhagwatireads thus:- xxx xxx xxx 117. ……………………Is the subsequent Full Bench of the High Court bound to follow the decision of the previous Full Bench of the High Court, though the previous Full Bench consisted of a lesser number of Judges than the subsequent Full Bench? The question ultimately resolves itself into a narrow one, namely, how far the principle of superiority of numerical strength should be carried. If the principle of superiority of numerical strength is applied to Full Benches of the High Court whatever be the numerical strength of the Judges constituting the Full Benches, a Full Bench of four Judges would be able to override the previous decision of a Full Bench of three Judges, a Full Bench of five Judges would be able to override the previous decision of a Full Bench of four Judges and so on and so forth. Beaumont, C.J., expressed a doubt as regards the correctness of this position in 43 Bom LR 864 : (AIR 1941 Bom 408) in the following terms:— “……Apparently it was considered that five Judges by a majority of four to one, could overrule a unanimous decision of four Judges, the net result being that the opinion of four Judges prevailed over the opinion of five Judges of co- ordinate jurisdiction. There seems to be very little authority 18 (1) AIR 1960 SC 936 (2) AIR 1960 SC 1118 4 on the powers and constitution of a Full Bench.-There can be no doubt that a Full Bench can overrule a Division Bench, and that a Full Bench must consist of three or more Judges; but it would seem anomalous to hold that a later Full Bench can Overrule an earlier Full Bench, merely because the later bench consists of more Judges than the earlier. If that were the rule, it would mean that a Bench of seven Judges, by a majority of four to three, could overrule a unanimous decision of a Bench of six Judges, though all the Judges were of co-ordinate jurisdiction.” .......................... It was the anomaly of this situation which prompted Beaumont, C.J., to make the aforesaid observations. This anomaly is, however, inherent in the principle of superiority of numerical strength and should not stand in the way of acceptance of that principle in its application to Full Benches of the High Court . The same anomaly also arises when four or five Judges of the High Court, each sitting singly take one view of the law on a particular point while a Division Bench consisting of two Judges takes a different view or when three or four Division Benches, each consisting of two Judges, take one view on a point of law while a Full Bench of three Judges takes a different view. The opinion of two Judges prevails over the opinion of four or five Judges in the former case while in the latter case the opinion of three Judges prevails over the opinion of eight or ten Judges, though all the Judges are of co-ordinate jurisdiction. This anomaly cannot, therefore, be a valid argument against the application of the principle of superiority of numerical strength amongst Full Benches of the High Court. The principle of superiority of numerical strength is a principle which, as I have already pointed out above, imparts flexibility to the law and provides an easy machinery within the framework of the High Court itself for correction of erroneous decisions which would otherwise stand inviolate, immune from challenge except on appeal to the Supreme Court.” (Emphasis Supplied) F. It may be mentioned that a Constitution Bench of this Court in a judgment reported as Central Board of Dawoodi Bohra Community and Anr. v. State of Maharashtra and Anr. 19 quoted from the earlier Constitution Bench 19 (2005) 2 SCC 673 5 judgment in Union of India and Anr. v. Raghubir Singh (Dead) By Lrs. Etc. 20 and held as under: “10. Reference was also made to the doctrine of stare decisis. His Lordship observed by referring to Sher Singh v. State of Punjab [(1983) 2 SCC 344 : 1983 SCC (Cri) 461] that although the Court sits in divisions of two and three Judges for the sake of convenience but it would be inappropriate if a Division Bench of two Judges starts overruling the decisions of Division Benches of three. To do so would be detrimental not only to the rule of discipline and the doctrine of binding precedents but it will also lead to inconsistency in decisions on points of law; consistency and certainty in the development of law and its contemporary status — both would be immediate casualty. xxx xxx 12. Having carefully considered the submissions made by the learned Senior Counsel for the parties and having examined the law laid down by the Constitution Benches in the abovesaid decisions, we would like to sum up the legal position in the following terms: (1) The law laid down by this Court in a decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or coequal strength. (2) A Bench of lesser quorum cannot disagree or dissent from the view of the law taken by a Bench of larger quorum. In case of doubt all that the Bench of lesser quorum can do is to invite the attention of the Chief Justice and request for the matter being placed for hearing before a Bench of larger quorum than the Bench whose decision has come up for consideration. It will be open only for a Bench of coequal strength to express an opinion doubting the correctness of the view taken by the earlier Bench of coequal strength, whereupon the matter may be placed for hearing before a Bench consisting of a quorum larger than the one which pronounced the decision laying down the law the correctness of which is doubted. 20 (1989) 2 SCC 754 6 (3)...........................” G. The conclusion (1) is that a decision delivered by a Bench of largest strength is binding on any subsequent Bench of lesser or coequal strength. It is the strength of the Bench and not number of Judges who have taken a particular view which is said to be relevant. However, conclusion (2) makes it absolutely clear that a Bench of lesser quorum cannot disagree or dissent from the view of law taken by a Bench of larger quorum. Quorum means the bench strength which was hearing the matter. H. Thus, it has been rightly concluded that the numerical strength of the Judges taking a particular view is not relevant, but the Bench strength is determinative of the binding nature of the Judgment. .............................................J. (HEMANT GUPTA) NEW DELHI; SEPTEMBER 19, 2022. 7