Supreme Court Constitution Bench Rules Out Automatic Vacation of High Court Stay Orders, Emphasizes Fair Hearing and Judicial Mind

Larger Bench overturns Asian Resurfacing directions, holding that Article 142 powers cannot be used for blanket judicial legislation; High Courts must apply judicial mind before vacating interim stays

In a landmark judgment delivered on February 29, 2024, a Constitution Bench of the Supreme Court of India in High Court Bar Association, Allahabad v. State of U.P. decisively held that the automatic vacation of interim stay orders granted by High Courts merely on the expiry of a fixed period, as previously directed in Asian Resurfacing of Road Agency Pvt. Ltd. v. CBI (2018), is impermissible under the Constitution. The Bench comprising Chief Justice Dr. Dhananjaya Y. Chandrachud and Justices Abhay S. Oka, J.B. Pardiwala, Manoj Misra, and Pankaj Mithal set aside the earlier directions that mandated stay orders to automatically lapse after six months unless extended by a speaking order.

The Court reasoned that such automatic vacation amounts to judicial legislation, which is beyond the scope of judicial powers under Article 142 of the Constitution. The exercise of Article 142 jurisdiction, the Court clarified, is intended to do complete justice between the parties before the Court and cannot nullify substantive rights of litigants who are not parties to the proceedings before it. The Court emphasized the necessity of “application of mind” and adherence to principles of natural justice before vacating or modifying any interim order, including stay orders.

The judgment highlighted that interim stays are granted based on a prima facie case, balance of convenience, and irreparable injury considerations, and such orders cannot be rendered invalid solely due to the passage of time without fault of the party benefiting from the stay. It condemned the practice of automatic vacation of stays without hearing the affected party as fundamentally unjust and arbitrary.

The Bench also underscored the constitutional status and independence of High Courts, reiterating that High Courts are not judicially subordinate to the Supreme Court, particularly in their jurisdiction under Articles 226 and 227 of the Constitution. The Court held that the power of High Courts to grant interim relief, including stays, cannot be constrained by blanket Supreme Court directions limiting the validity of such orders to six months.

The Court cautioned against constitutional courts issuing rigid timelines for disposal of cases or stay orders, observing that such directions amount to judicial micromanagement and do not account for the complex realities of case pendency, diverse priorities, and judicial capacity across courts. It stressed that fixing priorities and managing pendency is best left to the courts where cases are pending, except in extraordinary circumstances warranting exceptional directions.

Further, the Court laid down procedural guidelines for High Courts while passing interim stay orders and dealing with applications seeking their vacation: ad-interim relief should normally be granted for a limited duration, and any confirmation or vacation of such relief must follow a hearing and application of judicial mind. High Courts must prioritize hearings on applications for vacating stays and cannot defer them indefinitely or lump them with the main case hearings.

The judgment also clarified that the automatic vacation provision under Article 226(3) of the Constitution applies only when the interim order is passed ex parte without notice to the affected party, and even then, vacation occurs only if the application for vacation is not disposed of within two weeks. This analogy was used to emphasize that automatic vacation without an application and hearing is alien to the constitutional scheme.

In conclusion, the Court answered the reference questions negatively: it cannot, in exercise of its Article 142 powers, direct automatic vacation of interim stay orders or mandate day-to-day hearings within fixed periods for all pending cases with interim relief. The reference from the three-judge Bench was answered accordingly, and pending petitions were directed to be placed before appropriate Benches for expeditious disposal.

This judgment is expected to have far-reaching implications on the management of interim orders across High Courts and curtails the Supreme Court’s power to issue blanket procedural directives that affect substantive rights. It reaffirms the rule of law, due process, and the constitutional balance between the Supreme Court and High Courts.

Statutory provisions

Article 142, Article 226(3), Article 227, Code of Criminal Procedure 1973 (Section 482), Constitution of India, 1950

High Court Bar Association, Allahabad v. State of U.P. (SC)(Constitution Bench) : Law Finder Doc Id # 2510532