17.03.2026 vs State Of H.P on 4 May, 2026

Himachal Pradesh High Court

Reserved On: 17.03.2026 vs State Of H.P on 4 May, 2026

                                                                      2026:HHC:14335




     IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

                                       Cr. Appeal No. 561 of 2024
                                       Reserved on: 17.03.2026




                                                                     .

                                       Date of Decision: 04.05.2026.





    Ravi Kumar                                               ...Appellant

                                    Versus
    State of H.P.                                            ...Respondent




                                             of
    Coram
    Hon'ble Mr Justice Rakesh Kainthla, Judge.
                      rt
    Whether approved for reporting?1 No

    For the Appellant                    :    Mr J.P. Sharma, Advocate.

    For the respondent/State             :    Mr Ajit Sharma,                   Deputy
                                              Advocate General.


    Rakesh Kainthla, Judge

The appellant stood surety for accused Ravi Kumar,

S/o Parveen Kumar undertaking to produce him in the Court of

learned Special Judge, Chamba or any other Court to answer the

charge of the commission of an offence punishable under Section

20 of Narcotic Drugs and Psychotropic Substances Act (in short

‘NDPS Act‘) and in case of failure to pay an amount of ₹1,00,000/-

to the State of H.P. The accused failed to appear before the Court

1 Whether reporters of Local Papers may be allowed to see the judgment? Yes.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

and the Court issued bailable warrants to secure his presence.

However, he failed to appear before the learned Trial Court;

.

hence, the Court cancelled and forfeited the bail bonds of the

accused to the State of Himachal Pradesh and initiated

proceedings under Section 446 of Cr. P.C. A notice was served

upon the present appellant, but he failed to appear before the

of
Court, and his presence was also secured by way of bailable

warrants. He filed a reply asserting that he was not aware that the
rt
accused had not appeared before the Court on 07.09.2024 or

before that, and he sought an opportunity of one month to

produce the accused Ravi Kumar before the Court. The Court held

vide order dated 17.09.2024 that since the appellant/respondent

had failed to produce the accused, he was liable to pay a sum of

₹1,00,000/- to the State of H.P. Consequently, warrants of

recovery were issued to the District Collector for realising the

amount. Aggrieved by the order, the appellant has filed the

present appeal.

2. The matter came up for hearing before this Court, and

the court ordered on 19th June, 2024, that the question whether a

notice is required to be issued to the surety before forfeiture of the

bonds had already been referred to a larger Bench in Madan Verma

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Vs. State of H.P., Criminal Appeal No.344 of 2023 and the answer was

awaited. Therefore, a direction was issued to list the matter after

.

the receipt of the answer to the reference. Learned counsel for the

appellant requested on 17th March, 2026, to hear the matter

finally; therefore, the matter was heard finally without awaiting

the outcome.

of

3. Mr J.P. Sharma, learned counsel for the appellant,

submitted that the learned Trial Court erred in issuing a warrant
rt
under section 421 of the CrPC to the District Collector to realise

the amount by sale of the immovable property. The appellant was

not served as per the law, and the order dated 17th September,

2024, is bad in the eyes of the law. The appellant is the sole earner

of the family, and in case of the sale of the property, the appellant

and his family members would suffer irreparable harm. No

adequate opportunity of hearing was provided to the appellant

before imposing the penalty. Learned Trial Court failed to notice

the judgment of this Court in Sunita Vs. State of H.P. passed in

Criminal Appeal No.189 of 2023, wherein, this Court had set aside

a similar order after relying upon the earlier judgment of this

Court in Narata Verma Vs. State of H.P, 1993(2) Shimla Law Cases

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

193. Hence, he prayed that the present appeal be allowed and the

order passed by the learned Trial Court be set aside.

.

4. Mr Ajit Sharma, learned Deputy Advocate General for

the respondent/State, submitted that the appellant was properly

served. He was provided an opportunity to produce the accused,

but he failed to do so. The accused was declared a proclaimed

of
offender. The appellant had undertaken to produce the accused or

to pay an amount of ₹1,00,000/- to the State; therefore, the
rt
learned Trial Court was justified in passing an order for the

recovery of ₹1,00,000/- as per the undertaking of the appellant.

There is no infirmity in the order passed by the learned Trial

Court; hence, he prayed that the present appeal be dismissed.

5. I have given considerable thought to the submissions

made at the bar and have gone through the records carefully.

6. The record of the learned Trial Court shows that the

accused was absent on 9th July, 2024; hence, his personal and

surety bonds were forfeited to the State of H.P. Proceedings under

Section 446 of CrPC were ordered to be initiated against the

accused and his surety. The endorsement made by the office

shows that the notice was duly served upon the appellant. The

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
copy of notice dated 9th July, 2024, returnable for 20th July, 2024,

bears an endorsement that the notice was served upon Ravi

.

Kumar, the present appellant, and he was personally informed of

the date of hearing. He failed to appear before the Court on 20th

July, 2024; consequently, the Court issued the bailable warrants

to secure his presence. He appeared before the Court on 7th

of
September, 2024 and showed his ignorance regarding the

whereabouts of the accused, who was already declared a
rt
proclaimed offender. The appellant was called upon to file the

reply and he submitted a reply stating that he came to know on 7th

September, 2024 that the accused had not appeared before the

Court on any date of hearing till 7th September, 2024 after filing

of the charge-sheet by the Police, the appellant sought an

opportunity of at least one month to contact and produce the

accused before the Court because he had come to know that the

accused had left his abode after selling his house and had settled

somewhere else or he was in Police/judicial custody in some jail.

7. The learned Trial held that a surety bond is like a

contract between the Court and the surety to the extent that, in

case of failure of the accused to appear in the Court, the surety

would produce the accused. In the event of failure, he would pay

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
the bond amount to the State. In the present case, the accused

absconded and was declared a proclaimed offender. Therefore,

.

the appellant was liable to pay an amount of ₹1,00,000/- to the

State of H.P. as per the terms of the bond furnished by him. The

appellant had failed to pay the amount; hence, a warrant was

ordered to be issued to the District Collector to realise the

of
amount, as arrears of land revenue.

8. It was submitted that a show cause notice was not
rt
issued before the forfeiture of the bond, and the proceedings are

bad. It is necessary to refer to Section 446 of Cr.P.C. to appreciate

this submission. The section reads as follows:

446. Procedure when the bond has been forfeited.–(1)
Where a bond under this Code is for appearance, or
production of property, before a Court and it is proved to

the satisfaction of that Court, or of any Court to which the
case has subsequently been transferred, that the bond has

been forfeited, or where, in respect of any other bond
under this Code, it is proved to the satisfaction of the Court
by which the bond was taken, or of any Court to which the

case has subsequently been transferred, or of the Court of
any Magistrate of the first class, that the bond has been
forfeited, the Court shall record the grounds of such proof,
and may call upon any person bound by such bond to pay
the penalty thereof or to show cause why it should not be
paid.

9. This section provides that when the bond has been

forfeited, and this fact has been proved to the satisfaction of the

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Court, the Court shall record the grounds of such proof and may

call upon the person bound by such bond to pay the penalty

.

thereof or to show cause as to why it should not be paid. It is also

apparent from Form-48 provided in schedule II of the Cr.P.C. that

the surety is informed of the fact that the accused had failed to

appear before the Court, and because of such default, the surety

of
had forfeited the sum of rupees undertaken to be paid by him.

Thereafter, it asks the surety to pay the penalty or show cause as
rt
to why the payment of the amount should not be enforced against

the surety. It was held in Fatehchand Wadhumal v. Emperor, AIR

1940 Sind 136, that when the Magistrate issued a notice to the

surety to show cause why the bond should not be forfeited, the

procedure was irregular. The Court is bound to forfeit the bond

when the accused does not appear, and there is no provision for

issuing notice to the surety to show cause why the bond should

not be forfeited. It was observed as under: –

“3. The Magistrate shall issue a warrant directing the
arrest of the accused, and only on the appearance of the
accused before him does the Magistrate then discharge the
surety; but in this case, the Magistrate appears to have
discharged the surety before the accused appeared or was
brought before him. He appears to have issued notice to the
surety to show cause why the bond should not be forfeited and
also issued notice to the accused, and on the same day, though

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
the accused was absent, to have discharged the surety under
Section 502 of the Cr PC. All this is quite irregular. Section 514
of the Cr PC requires the Court to record the grounds of the
proof that the bond has been forfeited, and a bond for

.

appearance is forfeited when the accused does not appear, but

it does not require the Court to issue notice to show cause why
the bond should not be forfeited. The Court may issue notice
to show cause why the penalty resulting from the forfeiture

should not be imposed, and I have again and again advised
Magistrates to refer to the relevant Sections of the Code of
Criminal Procedure, to read them and to follow them when

of
mistakes such as these would not occur….” (Emphasis
supplied)

10. Hon’ble Supreme Court also held in Ghulam Mehdi v.

rt
State of Rajasthan, AIR 1960 SC 1185, that notice has to be given to

the surety before recovering the money from him to show cause

as to why the amount should not be recovered from him. It was

observed: –

“4. It is not necessary to go into the first point in our
opinion unless notice is given to the surety under Section

514(1) to show cause why the surety bond be not paid. No
proceedings for recovery under Section 514 can be taken.

Section 514(1) & (2) is as follows:

“Section 514. (1) Whenever it is proved to the

satisfaction of the court by which a bond under this
Code has been taken, or of the Court of a Presidency
Magistrate or Magistrate of the first class,
or, when the bond is for appearance before a court,
to the satisfaction of such court,
that such a bond has been forfeited, the court shall
record the grounds of such proof and may call upon
any person bound by such a bond to pay the penalty
thereof or to show cause why it should not be paid.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

Section 514(2) If sufficient cause is not shown and
the penalty is not paid, the court may proceed to
recover the same by issuing a warrant for the
attachment and sale of the moveable property

.

belonging to such person or his estate if he be dead.”

5. This provision shows that before a surety becomes liable
to pay the amount of the bond forfeited, it is necessary to
give notice why the amount should not be paid, and if he

fails to show sufficient cause, only then can the Court
proceed to recover the money. In the present case, the
appellant was not called upon to show cause why the

of
penalty should not be paid. Before a man can be penalised,
forms of law have to be observed, and an opportunity has
to be given to a surety to show cause why he should not be
made to pay and as in this case that was not done,
rt
proceedings cannot be said to be in accordance with law
and should therefore be quashed.”

11. The Division Bench of Orissa High Court held in

Jagannath Rout v. State of Orissa 1975 Cri LJ 1684 that the Court has

to satisfy itself that a bond had been forfeited, which means that

the condition laid down in the bonds has been contravened, and

thereafter the Court has to issue a show cause as to why the

amount be not released from him. There is no provision for

issuing a show-cause notice before forfeiting the bond. It was

observed: –

“4. These two sub-sections thus contemplate two
different stages in the proceedings before the Magistrate.
In the first stage, the Court has to satisfy itself that a bond
has been forfeited, which means that the condition
imposed upon the executant of the bond and agreed to by
him had been contravened. If the bond is for the

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
appearance of the accused in Court, as it is in this case, the
fact that the accused had absented himself is sufficient to
constitute a breach of the condition and therefore for the
forfeiture of the bond. If, on the other hand, the bond is for

.

keeping peace or being of good behaviour, the person who

alleges that the person bound under the bond has
infringed the condition laid upon him must furnish proof
to the satisfaction of the Court that there has been such

infringement. It is only on such proof that the bond can be
forfeited. There is thus a clear distinction between a bond
for appearance on one side and a bond for keeping the

of
peace or for being of good behaviour on the other.
Doubtless, in both cases, it has to be proved to the
satisfaction of the Court that there has been a forfeiture of
the condition of the bond, and the Court has also to record
rt
the grounds of such proof. But so far as a bond for
appearance is concerned, the very fact that the accused has
failed to appear in Court on the date fixed is sufficient

proof of the fact that the condition of the bond has been
forfeited, and no further proof is necessary. This is exactly
what has happened in this case. It is not disputed that on
the date fixed, namely, 22-3-1973, the accused Mahadeb

Behera, for whom the petitioner stood surety, failed to
appear in Court. Consequently, there occurred a breach of
the condition of the bond executed by the petitioner,

undertaking to cause the production of the accused on all
dates of hearing. Doubtless, as I find from the record of the

Magistrate, he has not expressly recorded his satisfaction
that the bond has been forfeited; that is only an
irregularity which does not go to the root of the matter.

The very fact that he proceeded to the second stage in
directing the issue of a notice to the petitioner to show
cause why the bond amount shall not be realised from him
shows beyond doubt that the Magistrate was satisfied that
the bond had been forfeited. There is nothing in sub-
section (1) of Section 514 which requires the Court at that
stage to give notice to the executant of the bond to show
cause against forfeiture before the Magistrate reaches the
satisfaction that the bond has been forfeited.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

5. The second stage relates to the realisation of the
forfeited bond amount. At this stage, two alternatives are
open to the executant of the bond. He may pay the amount
mentioned in the bond, and if this is done, no further

.

proceeding is necessary. He may, in the alternative, show

cause why the amount mentioned in the bond should not
be paid by him. If he shows such cause, it has to be duly
considered by the Magistrate, and necessary orders

passed. There is no dispute that a show cause notice was
issued to the petitioner and that he appeared in Court and
showed cause. That was duly considered by the Magistrate,

of
and it is thereafter that he passed the impugned order. No
exception, therefore, can be taken against the order passed
by the learned Magistrate.

6. Considerable reliance is placed by the learned Counsel
rt
for the petitioner on a decision of the Supreme Court
in Ghulam Mehdi v. State of Rajasthan, AIR 1960 SC 1185 :

(1960 Cri LJ 1527). The question that arose for
consideration in that case was whether a notice had to be
given to the sureties to show cause why the penalty should
not be paid. After referring to sub-sections (1) and (2) of

Section. 514, Criminal P.C., their Lordships stated at page
1186 thus:

“This provision shows that before a surety becomes

liable to pay the amount of the bond forfeited, it is
necessary to give notice why the amount should not

be paid, and if he fails to show sufficient cause, only
then can the Court proceed to recover the money. In
the present case, the appellant was not called upon

to show cause why the penalty should not be paid.
Before a man can be penalised, forms o£ law have to
be observed, and an opportunity has to be given to a
surety to show cause why he should not be made to
pay and as in this case that was not done,
proceedings cannot be said to be in accordance with
law and should therefore be quashed.”

7. In the passage quoted above, their Lordships were
clearly referring to the second stage of the proceeding, and

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
as I have already pointed out, such a notice has been issued
in this case. Nowhere have their Lordships stated that at the
first stage, that is, before forfeiting the bond executed for the
appearance of the accused, and in a case where admittedly the

.

accused has not appeared, the Court is bound to give a notice

to the surety to show cause why the bond should not be
forfeited. The bond executed was one for causing the
appearance of the accused, and as admittedly there was no

appearance of the accused, there was automatic contravention
of the condition imposed upon the executant of the bond
involving forfeiture thereof. It is not understood what further

of
cause the surety could show at that stage. It was argued that if
a notice is issued to the surety before the bond was forfeited,
he could come and urged that the non-appearance of the
accused was due to circumstances beyond his control. That is a
rt
plea which the surety can urge at the second stage when he is
called upon to show cause why he should not pay the penalty.
The petitioner was given such an opportunity in this case.

8. The petitioner next relied upon a decision of the Patna
High Court in Zulmi Kahar v. Emperor, AIR 1929 Pat 643
where Fazl All, J. (as he then was) referring to Section

514(1) Criminal P.C. stated that the proper course for a
Magistrate proceeding to pass an order under Section
514(1) is to come to a finding based on some evidence that

the bail bond executed by the surety has been duly
forfeited and then only to issue a notice to show cause why

the penalty should not be realised from him. Very shortly
thereafter, when a similar case came up before
Macpherson, J., another learned Judge of the Patna High

Court in Rajbansi Bhagat v. Emperor, AIR 1929 Pat 658, His
Lordship observed: —

“There is a palpable distinction between bonds
which are not and those which are for appearance
before a Court. Proof other than that directly before
the Court in its own record is required in the former
and not in the latter. Where the Court had before it
the order for bail, the bail bond and the fact that the
petitioners did not produce the accused, the

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
provisions of Section 514(1) were substantially
complied with and the High Court would not be
justified in interfering in revision where there was
no possible prejudice on the ground that the

.

proceedings of the Sessions Judge under Section 514

were without jurisdiction as he had before him
neither any proof that the bail-bond had beep
forfeited nor did he record the grounds of such proof

before he called upon the petitioners to show cause
why the penalty of the bond should not be paia.”

9. He distinguished the earlier decision of Fazl Ali, J. in AIR

of
1929 Pat 643 on the ground mat when in that case the
accused failed to appear, his mother filed a petition stating
that her son was unable to attend as he was suffering from
fever and the Magistrate took action forthwith without any
rt
inquiry into the allegation and when owing, it was alleged,
to illness the surety failed to appear to show cause why the

bond should not be forfeited, at once made an order of
forfeiture. In a subsequent Bench decision of that Court
in Tarni Yadav v. State, AIR 1962 Pat 431 : ((1962) 2 Cri LJ

627), the learned Judges dissented from the view earlier

expressed by Fad Ali, J. in AIR 1929 Pat. 643 and accepted
the view expressed by Macpherson, J. in AIR 1929 Pat 658.
That Bench held that where a bond has been executed by a

surety undertaking to cause the appearance of the accused
in Court and on the date fixed, the accused does not appear

in Court, there is a contravention of the condition of the
bond entailing forfeiture thereof, and no further inquiry is
either necessary or contemplated at that stage. The

Magistrate can straightway issue a notice to the surety to show
cause why the penalty mentioned in the bond should not be
recovered from him, and it is at that stage that the surety is
entitled to put forth such a plea as would be available to him.
With great respect, the view taken by the Division Bench in
AIR 1962 Pat 431: ((1962) 2 Cri LJ 627) appears to me to be
the correct view. This view has also been accepted by my
learned brother R.N. Misra, J. in Harish Chandra

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Pradhan v. State, (1974) 1 Cut W.R. 356.” (Emphasis
supplied)

12. It was held by this Court in Dhanvir vs. State 1975 Cr.L.J.

.

1347 that a show cause notice cannot be issued before forfeiture

of the bond. It was observed:

“A perusal of Section 514 will make it abundantly clear that
the Court has to be satisfied in the first instance that a
bond for appearance was taken and that the said bond has

of
been forfeited, for which it shall record the grounds. The
order as to forfeiture of the bond, which is upon grounds
to be recorded to the satisfaction of the Court, is almost
automatic, no sooner than the condition of the bond is
rt
disregarded and the person fails to appear before the
Court. It is only after such an order of forfeiture is made by

the Court that a notice to show cause is to be issued to the
surety either to pay the penalty or to show a sufficient
cause why the penalty be not paid. Thereafter, the Court
has to consider the grounds made out by the surety in

support of his case, and after considering the case on
merit, if the Court is dissatisfied with the reasons shown,
an order is to be made for the realisation of the penalty. In

the instant case, this procedure has not been followed by
the learned Magistrate. It is an irregularity to pass a single

order forfeiting a surety bond and directing its amount to
be realised as a penalty. Under Section 514, as I have stated
before, two steps are essential:

(i) an order has to be passed forfeiting the bond

(ii) notice has to be served on the surety to show
cause why the amount be not realised from him by
way of penalty.

It has been held in Bishnu Dalai v. The State, AIR 1960
Orissa 108 : (1960 Cri LJ 842) that if the provisions of Section
514 are not followed, it would amount to an illegality and
not merely an irregularity. In the present case, the Magistrate

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
issued a notice to show cause as to why the bonds be not
forfeited. Such a notice is not even contemplated in Section 514.
On 22-10-1971, when these persons failed to appear, the
Magistrate had to see as to whether the bond was for the

.

appearance before the Court and as to whether, to the

satisfaction of such Court, the bond was forfeited as its
condition was not satisfied. He should have made an order to
that effect in the first instance. Only thereafter, he could have

issued a notice to these persons calling upon them either to pay
the penalty or to show cause why the same should not be paid.
Instead, the Magistrate proceeded to forfeit the bond as

of
well as he ordered for the realisation of the penalty, which,
however, he reduced to the advantage of these persons.
That was not only an irregularity in procedure, but the
order itself became a nullity.” (Emphasis supplied)
rt

13. It was held in Ranananda Choudhury v. State of Orissa,

1978 Cri LJ 597, that the failure to produce the accused on the due

date ipso facto establishes the infringement of the condition of the

bail bond. It was observed:

“5. … The above case arose out of a reference made by the
Sessions Judge to the effect that the learned Magistrate has

acted irregularly. According to the Sessions Judge, a notice
to the surety was a must, calling upon him to show cause,
and after hearing him alone, the order of forfeiture could

have been passed. In that reference, certain citations were
referred to. But, ultimately, this Court held otherwise as
quoted above. Subsequently, this case has been followed in
the case of Jagannath Rout v. State of Orissa : (1975 Cri LJ
1084 (Orissa)), decided by Hon’ble Justice Patra as A.C.J. In
that case, S. 514 was under consideration, and it was held
that the Magistrate can straightway issue a notice to the surety
to show cause why the penalty mentioned in the bond should
not be recovered from him, and it is at that stage that the

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
surety is entitled to put forth such a plea as would be available
to him.

xxx

.

8. This case refers to AIR 1929 Pat 658, AIR 1962 Pat 431:

((1962) 2 Cri LJ 627), (1974) 1 Cut WR 356, which have been
relied on. The difference highlighted in the decisions of
this Court has been fully reflected in the new provision S.

446 of the Code, which runs thus: —

Where a bond under this Code is for appearance, or
production of property, before a Court and it is

of
proved to the satisfaction of that Court, or of any
Court to which the case has subsequently been
transferred, that the bond has been forfeited, or
rt where, in respect of any other bond under this Code,
it is proved to the satisfaction of the Court by which
the bond was taken or of any Court to which the case
has subsequently been transferred, or of the Court of

any Magistrate of the first class, that the bond has
been forfeited. The Court shall record the grounds of
such proof and may call upon any person bound by
such bond to pay the penalty thereof or to show

cause why it should not be paid.

9. The provision of this new Code brings the difference,

namely, where a bond under this Code is for appearance,
or where, in respect of any other bond. In the instant case,

it is for causing the appearance of the accused by S. 446,
sub-sec. (1). The learned Sessions Judge, on the failure of
the bailor-petitioners to cause the production of the

accused, forfeited the bail bond and, in the Misc. case, has
asked them to show cause as to why the penalty under the
bond should not be realised. Finally, hearing the
explanation offered by the bailor petitioners in the Misc.
case, he has directed that the amount be realised under the
Distress Warrant as quoted above. It is very much in
conformity with the decision of this Court as well as the
provisions of S. 446 Cr. P.C. (New). There is no case of any
prejudice to the bailors. The amount under the bond is only

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Rs. 200/-, which they have been asked to pay. The amount,
also in the circumstances indicated by the learned Sessions
Judge, is not excessive. Accordingly, I would dismiss this
revision and direct the petitioners to pay a fine of Rs. 200/-

.

, the amount as directed by the learned Sessions Judge.”

(Emphasis supplied)

14. A similar view was taken in Mudhu v. State of

Karnataka, ILR 1981 Kar 1138, wherein it was held: –

“4. Section 446(1) of the Code lays down that if it is proved

of
to the satisfaction of the Court by which the bond was
taken, or of any Court to which the case has subsequently
been transferred, that the bond has been forfeited. This
wording clearly shows that if a term of a bond is violated
rt
or a breach of a term of a bond is committed, the bond
automatically stands forfeited. The Magistrate has to

satisfy himself that it has been forfeited. No formal order
of forfeiting the bond is called for. Therefore, the first
argument of Sri Kempanna that the Magistrate has issued
a notice without forfeiting the bond has no legs to stand.

5. Sri Kempanna nextly argued that the Magistrate ought
to have given an opportunity to the petitioner to produce
the accused after the petitioner appeared before the Court

in response to the notice served on him, and that he has
failed to do so, and, therefore, the levying of a penalty, as

has been made by both the Courts below, is not in
accordance with law. Here again, I see no force in the
argument because it is not provided in Section 446 of the Code

that an opportunity should be afforded to the surety to produce
the accused. After all, forfeiture of the bond, as already held
above, takes place as soon as the accused absents himself on a
particular date of hearing. If the surety is able to produce the
accused or produce the accused, the fact or circumstance may
be taken into consideration by the Magistrate who has taken
action against the surety in regard to levying of penalty on the
surety. The Magistrate can even waive the levying of a
penalty.” (Emphasis supplied)

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

15. This position was reiterated in Sadananda v. State of

Karnataka, 1985, Cri LJ 756 and it was held that Section 446 of

.

Cr.P.C. does not provide for any notice to be issued to the surety

before forfeiting the bonds executed by him. It was observed: –

“5. Section 446 of the Code does not provide for any notice to
be issued to the surety before forfeiting the bond executed by
him for failure of the terms of the bond executed by him. The

of
wording of Section 446(1) clearly shows that if a term of a
bond is violated or a breach of a term of a bond is
committed, the bond automatically stands forfeited. All
that is required is that the Magistrate has to satisfy himself
rt
that the bond has been forfeited. Therefore, the issue of the
notice to the surety before forfeiting the bond is not
necessary (see Madhu @ Bella Kudtarkar v. State of

Karnataka [ILR 1981 Kar 1138] ).

6. However, it is clear from the last portion of sub-section
(1) of Section 446 that once the bond has been forfeited,

the Court shall call upon the surety, bound by such bond,
to pay the penalty thereof or to show cause why it should
not be paid and at that stage the Court shall record the
grounds of the proof of the forfeiture of the bond. In other

words, at the stage of issuing the notice to the surety after
forfeiting his bond, the Court shall record the grounds of

the proof of the forfeiture of the bond and call upon the
surety to pay the penalty or to show cause why it should

not be paid. Obviously, the law enjoins upon the Court to
record the grounds of forfeiture of the bond at the time of
issuing the notice to the surety, calling upon him to show
cause why it should not be paid, so as to enable the surety
to show cause, if any, against payment of the bond amount
by way of penalty. This is particularly so because no notice
is contemplated under Section 446 to the surety before
forfeiting his bond. This being the position in law, it seems
to me that strict compliance with the provision relating to
the issue of the notice to the surety after forfeiting the

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
bond should be insisted upon because action to be taken
against the surety in these proceedings is of a penal
nature.” (Emphasis supplied)

16. Delhi High Court also took a similar view in Sham

.

Sunder v. State (NCT of Delhi) 1990 Cri LJ 2370, wherein it was held

at page 2372:

“8. There is no requirement of law that before forfeiting the
surety bond, any notice was liable to be given to the surety. In

of
accordance with the terms of the surety bond, the same stood
forfeited when the accused was declared a proclaimed
offender, and despite opportunities being given to the surety,
the surety failed to produce the accused in court.
rt

9. In Ghulam Mehdi v. State of Rajasthan, AIR 1960 SC 1185:

(1960 Cri LJ 1527), it has been held that notice to show cause

is liable to be issued to the surety only to explain as to why
he should not be made to pay the amount of the bond
already forfeited as a penalty. In Fatehchand
Wadhumal v. Emperor, AIR 1940 Sind 136 (1940-41 Cri LJ

802), while interpreting the similar provisions of the old
Criminal P.C. contained in S. 514, a Division Bench of the
said High Court clearly held that a bond for appearance

stands forfeited when accused does not appear and it does not
require the court to issue notice to show cause why the bond

should not be forfeited. A similar view has been laid down by
a single Judge of Orissa High Court in Ramananda
Choudhury v. State of Orissa, 1978 Cri LJ 597, I hold that it

was not necessary for the magistrate to have passed any
specific order in so many words that the bond stood
forfeited before issuing notice to the surety under S. 446 of
the Criminal P.C. to explain why the amount of bond which
stood forfeited be not realised from him as fine. The surety
bond of the petitioner stood forfeited as soon as a breach of the
terms of the bond was committed on the failure of the accused
to appear in court on the dates fixed by the court and failure of
the surety to produce the accused, and the accused having been

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
declared a proclaimed offender. The contents of the notice
under S. 446 of the Criminal P.C. served on the surety
clearly indicate that the bond of the surety stood forfeited,
and the same can be treated as a specific order of the

.

Magistrate forfeiting the surety bond, as no notice was

required to be given to the surety before forfeiting the
surety bond. So, I find no merit in their petition.”
(Emphasis supplied)

17. The Division Bench of Kerala High Court also held in

Thundichi v. State of Kerala, 2009 SCC OnLine Ker 6527, that there

of
is no requirement of issuing notice before the forfeiture of the

bond. It was observed: –

rt
“7. On perusal of the provision and Form No. 45 of the

bond, it is clear that as soon as there is a default by the
accused in not keeping himself present in the Court on the
date of trial, the bond gets automatically forfeited. The law
does not provide any requirement of the satisfaction to be

arrived at by the Court as to whether the absence is wilful
or not. At this stage, there is also no requirement prescribed as
to the Court to satisfy itself by giving an opportunity, either to
the accused or to the surety, thereof. In the case of a bond for

appearance, the court, on its own observation, is able to see
whether the accused is present or not and if he is not present,

it has to proceed under S. 446 to declare the bond
automatically forfeited. In our view, no independent proof

is necessary at this stage, and it would be a meaningless
formality to take evidence as to the obvious fact of the
absence of the accused before the court on the day of the
trial. The question whether the absence is wilful or not is
immaterial at that stage, since the accused and the surety
are together bound themselves to have the presence of the
accused on that day, and as such, mere absence itself
would entitle the bond to be forfeited. The latter part of
Form 45 if looked into in this regard and especially the
words “in case of his making default herein, I hereby bind

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
myself to forfeit to Government the sum of rupees…………”

indicate that both the accused and the surety are aware of
the fact that mere absence, for whatever reasons, wilful or
not, by the very absence of the accused would result in only

.

one situation, viz., forfeiture of the bond. As such, for this

purpose, in our view, there need not be any opportunity
given to the surety or any proof or evidence in respect of
the explanation of the accused or the surety as to whether

the absence was wilful or not, which need not be gone into.

8. Moreover, this so-called opportunity to the surety for
the absence of the accused is provided at a later stage, i.e.,

of
under sub-s. (2) of S. 446 Cr. P.C. It is only at the stage of
payment of penalty that the law itself provides an
opportunity, and if sufficient cause is not shown, the
penalty is bound to follow, apart from the forfeiture of the
rt
bond amount. Under sub-s. (3) of S. 446, it is also provided
that the Court, after giving an opportunity to the surety,

has the discretion to either levy or not any penalty and
even remit any portion of the penalty and enforce the
payment in part only.

9. On detailed reading of the entire provision, in our view,

forfeiture of the bond on mere physical absence of the accused
results in automatic forfeiture and there need not be any
enquiry, including any opportunity to the surety be given at

that stage or there is any requirement to consider any
explanation in this regard, especially when that stage is

provided later, as can be seen from sub-s. (2) and (3) of S. 446
Cr. P.C. In view of our aforesaid finding, we find that the
learned Single Judge, while laying down the law in the

cases of Usman v. State of Kerala and Geetha v. State of
Kerala (supra), has travelled beyond the scope of the
provision itself. Our observation is further fortified by an
earlier pronouncement of this Court in the case of Kafoor
Raja v. State of Kerala (1973 KLT 45) wherein it is held thus:

“In the case of a bond for appearance before a court,
the cause for forfeiture thereof arises immediately
on the failure on the part of the person bound by the
bond to appear in court at the appointed time or on

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
the appointed day, as no further proof regarding the
breach of the conditions is called for. In the case of a
bond for keeping the peace or for good behaviour,
the position is different for obvious reasons; proof

.

becomes necessary for the Magistrate to satisfy

himself that there has been a breach of the
conditions of the bond before an order forfeiting the
bond could be passed. A fact could be said to be

proved only when its existence is proved according
to the provisions contained in the Evidence Act. It,
therefore, appears to our mind that the satisfaction

of
is based on proof contemplated by sub-s. (1) of S. 514
is not mere subjective satisfaction. The Magistrate
cannot also allow the satisfaction required to be
reached by him by a judicial process, to be
rt
substituted by prima facie satisfaction of someone
else, like the Sub Inspector in the present case.
Prudence dictates that to conform to the spirit of the

provisions contained in the sub-section, the
Magistrate should insist on better proof without
resting content with the report of the Police Officer
or his evidence based on hearsay information, when

it is a question of forfeiture of a bond. The
examination of at least one person who had direct
knowledge about the alleged involvement in the

crime of the person whose bond is sought to be
forfeited would tend to minimise the chances for

abuse of process by interested persons. Of course,
the standard of proof required in proceedings like
this may not necessarily be equal to that required in

a case for the conviction of an accused. In
appropriate cases, even affidavits by persons having
direct knowledge about the incident may serve the
purpose, provided the persons swearing to such
affidavits would be made available for cross-
examination if the correctness of the averments is
disputed by the persons against whom such
affidavits are to be used. To dispense with such proof
absolutely and place reliance solely on the police

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
report or the evidence of the police officer, who
claims to have no direct knowledge about the actual
involvement of the accused, would lead to an
awkward situation and a miscarriage of justice,

.

particularly in a case which ultimately ends in

discharge or acquittal. In the present case, the
Magistrate had before him no legal evidence given
by any person who claimed to have direct knowledge

about any illegal act attributed to the persons bound
by the bond, and in that view, the forfeiture of the
bond cannot be upheld.”

of

10. Considering all these aspects, we answer the reference
by holding that the law laid down by the learned Single
Judge in Usman v. State of Kerala and Geetha v. State of
Kerala (supra) does not reflect the correct position. Hence,
rt
they are overruled. We hold that there is absolutely no
necessity of recording any satisfaction, reason and proof at the

automatic stage of forfeiture of the bond, as the mere absence
of the accused on the date fixed would result automatically in
the forfeiture of the bond.” (Emphasis supplied)

18. This judgment was followed by Asokan v. State of

Kerala, 2022 SCC OnLine Ker 9624, wherein it was held: –

“7. Where a bond is for the appearance of a person before
a Court, a default in his appearance, when he is not

exempted by the Court, will lead to automatic forfeiture.
There is no necessity of recording any satisfaction, reason
or proof at the stage of forfeiture of the bond, as the mere

absence of the accused on the date fixed would result
automatically in the forfeiture of the bond. The law on this
point was settled by a Division Bench of this Court
in Thundichi v. State of Kerala [(2009) 4 KLT 67].

8. Once the bond has been forfeited, the Court is competent
to call upon the concerned sureties or the person bound by
it to pay the penalty therein or to show cause why it should
not be paid. The appellants failed to show sufficient cause
for the non-payment of the penalty. Therefore, this Court

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
finds that the Court below is perfectly justified in holding
that the appellants are liable to pay a penalty.”

19. In Narata Ram versus State of H.P., 1994 Cr.LJ 491, the

.

petitioner Narata Ram had stood surety for the accused and

executed surety bonds, undertaking that he would cause the

appearance of the accused on every date of hearing. The accused

absconded. A notice was issued to the surety to produce the

of
accused, but he showed his inability. The bonds furnished by him

were forfeited to the State. Proceedings under Section 446 of Cr.

rt
P.C. were initiated. The surety was permitted to produce the

accused during the pendency of the proceedings under Section

446 of Cr.P.C. When he failed to do so, a penalty of Rs. 2000/- was

imposed upon him.

20. This Court held that the procedure adopted by the

Court was not proper. Once the bond has been forfeited, it is not

permissible to afford an opportunity to produce the accused and

thereafter order the payment of the penalty. It was observed: –

“7. In the instant case, a show-cause notice was issued to
the petitioner on 25th May 1992, pursuant to the order
passed by the Sub-Divisional Judicial Magistrate. Close
examination of the said order shows that none of the
accused could be served for want of a correct address, nor
either of them was otherwise present, and, therefore, the
prosecution was ordered to furnish the correct address of

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
the accused, within seven days and get it served for their
appearance on 1st July,1992, through non-bailable
warrants. It further shows that notice to Ashok Kumar,
Advocate, who identified the personal bonds of the

.

accused, was also issued. Further, this order discloses that

the petitioner showed his inability to produce either of the
accused persons, and this led to the order directing the
forfeiture of the bonds by initiating proceedings under

Section 446 of the Code of Criminal Procedure separately.
The Court below further directed the issuance of a show-
cause notice to the petitioner as to why the amount under

of
the bonds be not forfeited to the State of Himachal
Pradesh. Lastly, this order also shows that the petitioner
was afforded another opportunity to produce the accused
persons on 1st July 1992. It was on the next date, 1st July
rt
1992, that the final order imposing a part penalty of Rs.
2000/- in case of each surety bond was passed. It would be
pertinent to note that no fresh order forfeiting the bonds

of the petitioner in respect of each surety bond was passed,
nor any fresh show-cause notice was issued on 1st July
1992, pursuant to the petitioner having expressed his
inability to produce either of the accused persons in the

Court.”

21. The Court formulated the question whether the surety

bonds can be ordered to be forfeited along with an opportunity to

the surety to produce the accused in the Court and answered it

negatively. It was observed:-

“8. The question is whether a surety bond can be ordered
to be forfeited, simultaneously, an opportunity having
been afforded to the surety to produce the accused in the
Court? The answer is in the negative.”

22. It was held that Section 446 of CPC contemplates two

stages. The first stage is to satisfy the Court that the bond has

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
been forfeited, and the second stage is the realisation of the

amount. It was observed:-

.

“5. The fact that a surety bond in the sum of Rs. 5000/- in

respect of each one of the accused persons was executed by
the petitioner and that he had undertaken to produce the
accused persons before the Court, and the fact of their

failure to appear on any one of the dates fixed for hearing,
is not disputed. Also, there is no controversy that the
responsibility of surety arises from the execution of the

of
surety bond by him, and it is not contingent upon the
execution of a personal bond by the accused. Thus, the
forfeiture of the personal bond of the accused is not a
condition precedent to the forfeiture of the bonds executed
rt
by the sureties. [See: Ram Lal v. State of U.P., 1980 Cri LJ 826
: ((1979) 2 SCC 192: AIR 1979 SC 1498)]. A perusal of Section

446 of the Code of Criminal Procedure contemplates two
stages. The first stage is for the Court to satisfy itself that
the bond has been forfeited. The second stage relates to the
realisation of the forfeited amount of the bond. For this

purpose, it has to give him notice either to pay the penalty
or to show cause why it should not be paid. It is imperative
to note that if there are sufficient circumstances before the
Court, on the basis of which it can accept or reject the cause

shown, it need not take any evidence.

9. The Scheme of Section 446 of the Code of Criminal
Procedure envisages two stages, as indicated above. No
doubt, the accused did not appear, nor could they be

produced by the petitioner, and non-bailable warrants had
been issued for their appearance on 1st July, 1992. The
Court below had also afforded an opportunity to the
petitioner to produce the accused on 1st July, 1992. Had
this last opportunity to produce the accused been afforded,
the portion of the order dated 25th May 1992, directing the
forfeiture of the amount under the bonds was legal and
valid, and for the reasons stated above, the Court could be
deemed to have satisfied regarding the existence of

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
reasonable grounds for directing the forfeiture of the
bond. Here, a composite order was passed. The petitioner
could have produced the accused on 1st July 1992, and had
he complied with the order to this effect, the

.

circumstances would not have attracted the issuance of an

order forfeiting the bonds. Thus, in such circumstances,
the Court cannot be deemed to have satisfied itself as to the
existence of grounds for directing the issuance of

forfeiture of the bonds on 25th May 1992. In other words,
the trial Court committed an illegality by exercising
jurisdiction improperly, which had also not been noticed

of
by the appellate Court.”

23. It was further held that the notice was not proper as it

was not in form 48 of Schedule (2), which is a violation of natural
rt
justice. It was observed:-

“10. Even otherwise the perusal of the show-cause notice
issued to the petitioner shows that it is not in Form No. 48
of Schedule II of the Code of Criminal Procedure. The

notice does not indicate whether the accused had failed to
appear in terms of the surety bond, indicating that surety
had bound himself for regular appearance of the accused

in the Court in relation to the cases concerned and further
that surety had bound himself in default thereof to forfeit

the amount of the bond to the Government nor it discloses
that the accused had failed to appear before the Court
below and by reason thereof, petitioner had forfeited the

bond amount. The show cause notice is in a typed form.
Even the contents thereof do not depict the requisites of
the prescribed show cause notice in Form No. 48. A
mechanical process had been adopted by the Court below
in the issuance of this notice to the petitioner.

11. In this view of the matter too, the show-cause notice so
issued, cannot be deemed to be a legal and valid show-
cause notice for taking further action in proceedings under
Section 446 of the Code of Criminal Procedure.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

12. Learned counsel has also submitted that no
opportunity of being heard was afforded to the petitioner
in the show-cause notice. I have already observed that no
legal and valid notice was served. However, in the ordinary

.

course, the rule of natural justice requires that before any

adverse order is passed, the affected party should be given
an opportunity of being heard.”

24. It was held in the course of discussion that a notice to

the surety cannot be issued unless the order of forfeiture is

of
passed. It was observed:

“6. It is also settled law that a notice to the surety cannot
be issued unless the order of forfeiture is passed.
rt
Thereafter, the Court has to consider the grounds made
out by the surety in support of his case, and after

considering the case on merits, if the Court is dissatisfied
with the reasons shown, an order has to be made for the
realisation of the penalty. I am supported in my view by the
observations made in the case of Dhanvir v. State, 1975 Cri

LJ 1347 (Him Pra).

25. It is apparent from the judgment of this Court in

Narata Ram that it was not concerned with the question whether

a show cause notice is required to be issued to the surety before

the forfeiture of the bond. Even though in the course of the

discussion, the Court held that a show cause notice cannot be

issued before the forfeiture of the bond.

26. Hon’ble Mr Justice R. V. Raveendaran J explained in his

article Precedents–Boon or Bane? (2015) 8 SCC J-1 that the ratio

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
decidendi of a decision constitutes binding precedent and not

every observation contained in it. He wrote:

.

“The well-recognised definition of precedent is ‘an

adjudged case or decision of a court, considered as furnishing
an example or authority for an identical or similar case
afterwards arising or a similar question of law. Salmond

defines a precedent as a judicial decision which contains in
itself a legal authoritative element, which is described
as ratio decidendi. [Salmond’s Jurisprudence (10th Edn.) 191.]

of
The rule deducible from the application of law to the facts
and circumstances of a case constitutes the ratio
decidendi of the case. [Regional Manager v. Pawan Kumar
Dubey, (1976) 3 SCC 334.] What the Judges expressly
rt
decided or what they must be considered to have decided
by necessary implication by reference to the facts stated by

the Judges themselves are what constitute precedents.
[Gopal Upadhyaya v. Union of India, 1986 Supp SCC 501.]
Every decision of a court should ideally comprise three
components: (a) findings of material facts, direct and

inferential; (b) statements of the principles of law
applicable to the legal issues or problems disclosed by the
facts; and (c) judgment (the final decision) containing the

conclusions and directions of the court, based on the
combined effect of (a) and (b) above. [State of

Orissa v. Mohd. Illiyas, (2006) 1 SCC 275.] The concluding
part of a decision, that is, the ‘concrete decision’
containing the conclusions and directions of the court,

should not be confused with the ratio decidendi (reasons
for the decision). While the conclusions and directions in a
decision, that is, the concrete decision, alone bind the
parties to the litigation, the abstract ratio decidendi of the
decision, as ascertained on a consideration of the
judgment in relation to the subject matter of the decision,
has the force of law and is binding on all subordinate
courts and tribunals. [Halsbury’s Laws of England, 4th Edn.,
Vol. 26, Para 573.] In other words, a decision is binding as a

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
precedent, not because of its final conclusions or
directions, but because of its ratio. Ratio decidendi refers
to “the principle of law on which a decision is based”, or
the reason for the decision, or the point in a case which

.

determines what the decision should be. The legal

principle that constitutes the “ratio” of a decision is the
“precedent” for other cases.

PART III

Principles to be kept in view by those who apply
Precedents

of
The basic principles to be kept in view by the
courts/authorities who are required to follow precedents
are:

(i) The “ratio” of the decision is the precedent. Neither
rt
factual findings nor directions issued by the Supreme
Court under Article 142 are precedents.

(ii) Obiter dicta in a decision is not a precedent.

(iii) Non-speaking orders are not precedents.

(iv) Precedents are not to be read as statutory provisions.

(v) Even small differences in facts may lead to a different
conclusion.

(vi) Decisions rendered per incuriam are not to be followed.

(vii) Some precedents cease to be binding.

(viii) Divergent precedents should be dealt with in
accordance with the settled principles relating to
precedents.

Unfortunately, the above principles are repeatedly
ignored, many a time even by the High Courts, thereby
defeating the very object and efficacy of precedents.

(i) The “ratio” of the decision is the precedent
The first principle of precedents is that only a decision
relating to or involving a question of law or interpretation
of a legal principle can be said to have a ratio and used as a
precedent. A decision or judgment rendered purely on the

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
basis of the fact situation of a case, without involving the
application of any legal principle or provision of law,
cannot be considered as a precedent for deciding any other
case involving a different set of facts. [Prakash Chandra

.

Pathak v. State of U.P., AIR 1960 SC 195; PGI of ME &

Research v. Vinod Krishan Sharma, (2001) 2 SCC 59 and U.P.
Brassware Corpn. Ltd. v. Uday Narain Pandey, (2006) 1 SCC

479.]

(iv) Decisions of a court are not to be read as statutory
provisions
The next principle of precedents is that the contents of a

of
decision of a court are not to be read as if they are
provisions of a statute (or as Euclid’s theorems, which are
known for their precision). Judges interpret statutes, but
their judgments are not to be construed or interpreted as
rt
statutes. A statutory provision is not made with reference
to any particular case but is a pure principle in the abstract.

The words, phrases and provisions of a statute are
interpreted, if necessary, by embarking on discussions to
explain the meaning. On the other hand, the contents of a
judgment are built around the facts of that case and the

legal position is also stated with reference to the factual
background of the case.”

27. It was held in the Punjab Land Development and

Reclamation Corporation, Ltd. v. Presiding Officer, Labour Court,

(1990) 3 SCC 682: 1991 SCC (L&S) 71, that a decision is an authority

for what it decides, and only the ratio decidendi is binding. It was

observed:

44. An analysis of judicial precedent, ratio decidendi and
the ambit of earlier and later decisions is to be found in the
House of Lords’ decision in F.A. & A.B. Ltd. v. Lupton
(Inspector of Taxes) [1972 AC 634 : (1971) 3 All ER 948], Lord
Simon concerned with the decisions in Griffiths v. J.P.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Harrison (Watford) Ltd. [1963 AC 1 : (1962) 1 All ER 909]
and Finsbury Securities Ltd. v. Inland Revenue
Commissioner [(1966) 1 WLR 1402 : (1966) 3 All ER 105] with
their interrelationship and with the question

.

whether Lupton‘s case [1972 AC 634 : (1971) 3 All ER 948] fell

with-in the precedent established by the one or the other
case, said: (AC p. 658)
“…what constitutes binding precedent is the ratio

decidendi of a case, and this is almost always to be
ascertained by an analysis of the material facts of the
case–that is, generally, those facts which the

of
tribunal whose decision is in question itself holds,
expressly or implicitly, to be material.”

45. It has also been analysed: (AC pp. 658-59)
rt “A judicial decision will often be reached by a
process of reasoning which can be reduced into a
sort of complex syllogism, with the major premise

consisting of a pre-existing rule of law (either
statutory or judge-made) and with the minor
premise consisting of the material facts of the case
under immediate consideration. The conclusion is

the decision of the case, which may or may not
establish new law — in the vast majority of cases, it
will be merely the application of existing law to the

facts judicially ascertained. Where the decision does
constitute new law, this may or may not be expressly

stated as a proposition of law: frequently, the new
law will appear only from subsequent comparison
of, on the one hand, the material facts inherent in

the major premise with, on the other, the material
facts which constitute the minor premise. As a result
of this comparison, it will often be apparent that a
rule has been extended by an analogy expressed or
implied.”

46. To consider the ratio decidendi of a case, we have,
therefore, to ascertain the principle on which the case was
decided. Sir George Jessel in Osborne v. Rowlatt [(1880) 13

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Ch D 774], remarked that (Ch D, p. 785) ‘the only thing in a
Judge’s decision binding as an authority upon a
subsequent Judge is the principle upon which the case was
decided’.

.

47. The ratio decidendi of a decision may be narrowed or

widened by the judges before whom it is cited as a
precedent. In the process, the ratio decidendi, which the
judges who decided the case would themselves have

chosen, may be even different from the one which has been
approved by subsequent judges. This is because judges,
while deciding a case, will give their own reasons but may

of
not distinguish their remarks in a rigid way between what
they thought to be the ratio decidendi and what were
their obiter dicta, that is, things said in passing having no
binding force, though of some persuasive power. It is said
rt
that “a judicial decision is the abstraction of the principle
from the facts and arguments of the case”. “A subsequent

judge may extend it to a broader principle of wider
application or narrow it down for a narrower application”.
The submissions of Mr Venugopal that for the purpose
of ratio decidendi, the question is not whether a subsequent

bench of this Court thinks that it was necessary or
unnecessary for the Constitution Bench, or the earlier
bench to have dealt with the issue, but whether the

Constitution Bench itself thought it necessary to interpret
Section 2(oo) for arriving at the final decision has to be

held to be untenable in this wide and rigid form.”

28. Similarly, it was held in Islamic Academy of Education

v. State of Karnataka, (2003) 6 SCC 697: 2003 SCC OnLine SC 856 that

a judgment cannot be read like a statute and only the ratio

decidendi is binding. It was observed:

Interpretation of a judgment

139. A judgment, it is trite, is not to be read as a statute.

The ratio decidendi of a judgment is its reasoning, which

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
can be deciphered only upon reading the same in its
entirety. The ratio decidendi of a case or the principles and
reasons on which it is based is distinct from the relief
finally granted or the manner adopted for its disposal.

.

(See Executive Engineer, Dhenkanal Minor Irrigation

Division v. N.C. Budharaj [(2001) 2 SCC 721].)

140. In Padma Sundara Rao v. State of T.N. [(2002) 3 SCC
533], it is stated: (SCC p. 540, paragraph 9)

“There is always peril in treating the words of a
speech or judgment as though they are words in a
legislative enactment, and it is to be remembered

of
that judicial utterances are made in the setting of the
facts of a particular case, said Lord Morris
in Herrington v. British Railways Board [(1972) 2 WLR
537: 1972 AC 877 : (1972) 1 All ER 749 (HL)] (Sub
rt nom British Railways Board v. Herrington).
Circumstantial flexibility, one additional or

different fact may make a world of difference
between conclusions in two cases.”

(See also Haryana Financial Corpn. v. Jagdamba Oil
Mills [(2002) 3 SCC 496].)

141. In General, Electric Co. v. Renusagar Power Co. [(1987) 4
SCC 137] it was held: (SCC p. 157, paragraph 20)

“As often enough pointed out by us, words and
expressions used in a judgment are not to be

construed in the same manner as statutes or as
words and expressions defined in statutes. We do
not have any doubt that when the words

‘adjudication of the merits of the controversy in the
suit’ were used by this Court in State of U.P. v. Janki
Saran Kailash Chandra [(1973) 2 SCC 96: AIR 1973 SC
2071 : (1974) 1 SCR 31] the words were not used to take
in every adjudication which brought to an end the
proceeding before the court in whatever manner but
were meant to cover only such adjudication as
touched upon the real dispute between the parties
which gave rise to the action. Objections to

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
adjudication of the disputes between the parties, on
whatever ground, are in truth not aids to the
progress of the suit but hurdles to such progress.
Adjudication of such objections cannot be termed as

.

adjudication of the merits of the controversy in the

suit. As we said earlier, a broad view has to be taken
of the principles involved, and a narrow and
technical interpretation which tends to defeat the

object of the legislation must be avoided.”
142 In Rajeswar Prasad Misra v. State of W.B. [AIR 1965 SC
1887: (1965) 2 Cri LJ 817] it was held:

of
“No doubt, the law declared by this Court binds
courts in India, but it should always be remembered
that this Court does not enact.”

rt
(See also Amar Nath Om Prakash v. State of Punjab [(1985) 1
SCC 345: 1985 SCC (Tax) 92] and Hameed Joharan v. Abdul
Salam [(2001) 7 SCC

143. It will not, therefore, be correct to contend, as has
been contended by Mr Nariman, that answers to the
questions would be the ratio to a judgment. The answers to

the questions are merely conclusions. They have to be
interpreted, in a case of doubt or dispute with the reasons
assigned in support thereof in the body of the judgment,

wherefore, it would be essential to read the other
paragraphs of the judgment also. It is also permissible for

this purpose (albeit only in certain cases and if there exist
strong and cogent reasons) to look to the pleadings of the
parties.

144. In Keshav Chandra Joshi v. Union of India [1992 Supp
(1) SCC 272: 1993 SCC (L&S) 694 : (1993) 24 ATC 545], this
Court, when faced with difficulties where specific
guidelines had been laid down for the determination of
seniority in Direct Recruit Class II Engg. Officers’
Assn. v. State of Maharashtra [(1990) 2 SCC 715: 1990 SCC
(L&S) 339 : (1990) 13 ATC 348] held that the conclusions
have to be read along with the discussions and the reasons
given in the body of the judgment.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

145. It is further trite that a decision is an authority for
what it decides and not what can be logically deduced
therefrom. (See Union of India v. Chajju Ram [(2003) 5 SCC
568].)

.

29. A similar view was taken in Arasmeta Captive Power Co.

(P) Ltd. v. Lafarge India (P) Ltd., (2013) 15 SCC 414: (2014) 5 SCC (Civ)

302: 2013 SCC OnLine SC 1094, wherein it was observed:

“31. At this juncture, we think it condign to refer to certain

of
authorities which lay down the principle for
understanding the ratio decidendi of a judgment. Such a
deliberation, we are disposed to think, is necessary as we
notice that contentions are raised that certain
rt
observations in some paragraphs in SBP [SBP & Co. v. Patel
Engg. Ltd., (2005) 8 SCC 618] have been relied upon to build

the edifice that latter judgments have not referred to them.

32. In Ambica Quarry Works v. State of Gujarat [(1987) 1 SCC
213], it has been stated (SCC p. 221, para 18) that the ratio
of any decision must be understood in the background of

the facts of that case. Relying on Quinn v. Leathem [1901 AC
495 (HL)], it has been held that the case is only an
authority for what it actually decides, and not what

logically follows from it.

33. Lord Halsbury in Quinn [1901 AC 495 (HL)] has ruled

thus: (AC p. 506)
“… there are two observations of a general character

which I wish to make, and one is to repeat what I
have very often said before, that every judgment
must be read as applicable to the particular facts
proved, or assumed to be proved, since the
generality of the expressions which may be found
there are not intended to be expositions of the whole
law, but governed and qualified by the particular
facts of the case in which such expressions are to be
found. The other is that a case is only an authority for

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
what it actually decides. I entirely deny that it can be
quoted for a proposition that may seem to follow
logically from it. Such a mode of reasoning assumes that
the law is necessarily a logical code, whereas every

.

lawyer must acknowledge that the law is not always

logical at all.” (emphasis supplied)

34. In Krishena Kumar v. Union of India [(1990) 4 SCC 207:

1991 SCC (L&S) 112 : (1990) 14 ATC 846] the Constitution

Bench, while dealing with the concept of ratio decidendi,
has referred to Caledonian Railway Co. v. Walker’s
Trustees [(1882) LR 7 AC 259 : (1881-85) All ER Rep 592: 46

of
LT 826 (HL)] and Quinn [1901 AC 495 (HL)] and the
observations made by Sir Frederick Pollock and thereafter
proceeded to state as follows : (Krishena Kumar
case [(1990) 4 SCC 207: 1991 SCC (L&S) 112 : (1990) 14 ATC
rt
846], SCC pp. 226-27, para 20)
“20. … The ratio decidendi is the underlying

principle, namely, the general reasons or the
general grounds upon which the decision is based on
the test or abstract from the specific peculiarities of
the particular case which gives rise to the

decision. The ratio decidendi has to be ascertained by
an analysis of the facts of the case and the process of
reasoning involving the major premise consisting of a

pre-existing rule of law, either statutory or Judge-

made, and a minor premise consisting of the material

facts of the case under immediate consideration. If it is
not clear, it is not the duty of the court to spell it out
with difficulty in order to be bound by it. In the

words of Halsbury (4th Edn., Vol. 26, para 573):

‘The concrete decision alone is binding
between the parties to it, but it is the abstract
ratio decidendi, as ascertained on a
consideration of the judgment in relation to
the subject matter of the decision, which
alone has the force of law and which when it is
clear … it is not part of a tribunal’s duty to spell
out with difficulty a ratio decidendi to be

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
bound by it, and it is always dangerous to take
one or two observations out of a long judgment
and treat them as if they gave the ratio decidendi
of the case. If more reasons than one are given by

.

a tribunal for its judgment, all are taken as

forming the ratio decidendi.”

(emphasis supplied)

35. In State of Orissa v. Mohd. Illiyas [(2006) 1 SCC 275: 2006
SCC (L&S) 122], it has been stated thus: (SCC p. 282, para

12)

of
“12. … According to the well-settled theory of
precedents, every decision contains three basic
postulates: (i) findings of material facts, direct and
rt inferential. An inferential finding of facts is the
inference which the Judge draws from the direct, or
perceptible facts; (ii) statements of the principles of
law applicable to the legal problems disclosed by the

facts; and (iii) judgment based on the combined
effect of the above. A decision is an authority for
what it actually decides. What is of the essence in a
decision is its ratio and not every observation found

therein, nor what logically flows from the various
observations made in the judgment.”

36. In Islamic Academy of Education v. State of
Karnataka [(2003) 6 SCC 697], the Court has made the

following observations: (SCC p. 719, para 2)
“2. … The ratio decidendi of a judgment has to be
found out only by reading the entire judgment. In

fact, the ratio of the judgment is what is set out in
the judgment itself. The answer to the question
would necessarily have to be read in the context of
what is set out in the judgment and not in
isolation. In case of any doubt, as regards any
observations, reasons and principles, the other part of
the judgment has to be looked into. By reading a line
here and there from the judgment, one cannot find out
the entire ratio decidendi of the judgment.”

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

(emphasis supplied)

37. The said authorities have been relied upon in Natural
Resources Allocation, In re, Special Reference No. 1 of
2012 [(2012) 10 SCC 1], SCC p. 68, para 73.

.

38. At this stage, we may also profitably refer to another
principle which is of assistance to understand and
appreciate the ratio decidendi of a judgment. The

judgments rendered by a court are not to be read as
statutes. In Union of India v. Amrit Lal Manchanda [(2004)
3 SCC 75: 2004 SCC (Cri) 662], it has been stated that: (SCC
p. 83, para 15)

of
“15. … Observations of courts are neither to be read
as Euclid’s theorems nor as provisions of the statute,
rt and that too taken out of their context. [The]
observations must be read in the context in which
they appear to have been stated. … To interpret
words, phrases and provisions of a statute, it may

become necessary for Judges to embark on lengthy
discussions, but the discussion is meant to explain
and not to define. Judges interpret statutes; they do
not interpret judgments. They interpret words of

statutes; their words are not to be interpreted as
statutes.”

39. In Som Mittal v. State of Karnataka [(2008) 3 SCC 574:

(2008) 2 SCC (Cri) 1: (2008) 1 SCC (L&S) 910] it has been

observed that: (SCC p. 581, para 9)
“9. … Judgments are not to be construed as statutes.

Neither words nor phrases in judgments are to be

interpreted like provisions of a statute. Some words
used in a judgment should be read and understood
contextually and are not intended to be taken
literally. Many a time, a Judge uses a phrase or
expression with the intention of emphasising a
point or accentuating a principle, or even by way of
a flourish of writing style. Ratio decidendi of a
judgment is not to be discerned from a stray word or
phrase read in isolation.”

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

30. It was laid down by the Gujarat High Court in Mohmad

Ayub @ Babbu Sagirbhai Shaikh Versus Commissioner of Police,

.

Ahmedabad 1994 (1) GLR 589 that a decision is only an authority

for what it decides. The essence of a decision is its ratio and not

every observation found therein. It was observed:

“[3] In State of Orissa v. Sudhansu Sekhar Misra & Ors.,

of
AIR1968 SC 647, five learned Judges of the Apex Court
spoke as follows:

“… A decision is only an authority for what it actually
rt decides. What is of the essence in a decision is its
ratio, and note every observation found therein, nor
what logically follows from the various observations

made in it. On this topic, this is what the Earl of
Halsbury LC said in Quinn v. Leathern, 1901 AC 495:
‘Now before discussing the case of Alien y. flood, 1898
AC 1 and what was decided therein, there are two

observations of a general character which I wish to
make, and one is to repeat what I have very often
said before, that every judgment must be read as
applicable to the particular facts proved, or assumed

to be proved, since the generality of the expressions
which may be found there are not intended to be

expositions of the whole law, but governed and
qualified by the particular facts of the case in which
such expressions are to be found. The other is that a

case is only an authority for what it actually decides.
I entirely deny that it can be quoted for a proposition
that may seem to follow logically from it. Such a
mode of reasoning assumes that the law is
necessarily a logical Code, whereas every lawyer
must acknowledge that the law is not always logical
at all.’

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
It is not a profitable task to extract a sentence here and
there from a judgment and to build upon it.”

In H. H. Maharajadhiraja Madhav Rao Jivaji Rao Scindia
Bahadur & Ors. v. Union of India, AIR 1971 SC 530, a case

.

decided by eleven Judges, the Apex Court took note of the

fact that the Court was not called upon to decide a
particular question as of law, and observed as follows:

“………It is difficult to regard a word, a clause, or a
sentence occurring in a judgment of this Court,
divorced from its context, as containing a full
exposition of the law on a question when the

of
question did not even fall to be answered in that
judgment.”

In Municipal Committee, Amritsar v. Hazara Singh, AIR
rt
1975 SC 1087, three Judges of the Apex Court opined
that distortion of the passage in a judgment could not
pass muster, and approved the following observations

of the High Court of Kerala in State of Kerala v.
Parameswaran Filial Vasudevan Nair, 1975 FAC 8 : (1975
Cri. LJ 97) :

“Judicial propriety, dignity and decorum demand
that, being the highest judicial tribunal in the
country, even an obiter dictum of the Supreme Court

should be accepted as binding. The declaration of law
by that Court, even if it be only by the way, has to be

respected. But all that does not mean that every
statement contained in a judgment of that Court
would be attracted by Art. 141. Statements on matters

other than law have no binding force. Several
decisions of the Supreme Court are on facts and the
Court itself has pointed out in Gurcharan Singh v.
State of Punjab, (1972 FAC 549) and Prakesh Chandra
Palhak v. State of Uttar Pradesh (AIR 1960 SC 195) that
as on facts no two cases could be similar, its own
decisions which were essentially on questions of fact
could not be relied upon as precedents for the
decision of other eases.”

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

In Additional District Magistrate, Jabalpur v. Shivakant
Shukla, AIR 1976 SC 1207, a case decided by five Judges, it
was cautioned as follows :

“……Moreover, it must be remembered that when we

.

are considering the observations of a high judicial

authority like this Court, the greatest possible care
must be taken to relate the observations of a judge to
the precise issues before him and to confine such

observations, even though expressed in broad terms,
in the general compass of the question before him
unless he makes it clear that he intended his remarks

of
to have a wider ambit….”

[4] Even observations on law, though not part of the ratio
decidendi of law in the pronouncement, classified as obiter dicta
emanating from the Apex Court, are binding on this Court, and
rt
this Court cannot ignore them. An obiter dictum is an
observation by the Court on a legal question, not factual,

suggested by a case before it, but not arising in such a manner as
to require a decision. In the Commissioner of Income-Tax,
Hyderabad, Deccan v. M/s. Vazir Sultan & Sons, AIR 1959 SC 814, it
was stated :

” …… The obiter dicta of this Court, however, are
entitled to considerable weight and we on our part fully
endorse the Same. … ”

In Income-Tax Officer, Tuticorin y. T S. Devinatha

Nadar, AIR 1968 SC 623, even an opinion of the Apex
Court was held to merit the highest respect.
[5] In Municipal Committee, Amritsar v. Hazara Singh, AIR 1975 SC

1087, as already noted, the Apex Court approved the view of the
Kerala High Court that “judicial propriety, dignity and decorum
demand that being the highest judicial tribunal in the country,
even obiter dictum of the Supreme Court should be accepted as
binding Declaration of law by that Court even if it be only, by the
way, has to be respected”.

[6] Either way, as ratio decidendi or obiter dictum, it has got to
be a proposition of law. But if what has been expressed is only a
discussion of factual aspects of the case and a pronouncement on

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
the same, then that cannot be cited as a precedent to govern
decisions in other cases. In Prakash Chandra Pathak v. State of
Uttar Pradesh, AIR 1960 SC 195, this is how the proposition was set
down :

.

” … It is enough to say that decisions even of the highest

Court on questions which are essentially questions of
fact, cannot be cited as precedents governing the
decision of other cases which must rest in the ultimate

analysis upon their particular facts. …”

As to what should be the right approach to the decisions
of the Apex Court, the said Court, as already noticed, in

of
Municipal Committee, Amritsar v. Hazara Singh, AIR 1975
SC 1087, approved as correct the view of the High Court
of Kerala that statements on matters other than law
have no binding force; several decisions of the Supreme
rt
Court are on facts; as on facts no two cases could be
similar, its own decisions which were essentially on

questions of fact cannot be relied upon as precedents
for the decision of other cases. It has always been
accepted by Courts as a well-settled theory that there
are three ingredients in a decision as follows :

(i) Findings of material facts, direct and inferential;

(ii) Statement of the principles of law applicable to the

legal problems disclosed by such facts;

AND

(iii) Judgment based on (i) and (ii).

In Qualcast (Wolverhampton) Ltd. v. Haynes, 1959 Appeal

Cases 743, a solution on facts was not treated as a
proposition of law. The ratio decidendi may be defined
as a statement of law applied to the legal problems
raised by the facts as found, upon which the decision is
based.

xxxxxxxxxxx
[29] Lord Halsbury (Halsbury’s Laws of England, Fourth
Edition, Vol. 26, para 573) describes the Ratio decidendi in
the following manner:

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

“The use of precedent is an indispensable foundation
upon which to decide what the law is and its application
to individual cases; it provides at least some degree of
certainty upon which individuals can rely in the conduct

.

of their affairs, as well as a basis for the orderly

development of legal rules. The enunciation of the
reason of principle upon which a question before a Court
has been decided is alone binding as a precedent. This

underlying principle is called the ratio decidendi,
namely the general reasons given for the decision or the
general grounds upon which it is based, detached or

of
abstracted from the specific peculiarities of the
particular case which gives rise to the decision. What
constitutes binding precedent is the ratio decidendi, and
this is almost always to be ascertained by an analysis of
rt
the material facts of the case, for a judicial decision is
often reached by a process of reasoning involving a
major premise consisting of a pre-existing rule of law,

either statutory or judge-made, and a minor premise
consisting of the material facts of the case under
immediate consideration.

The concrete decision alone is binding between the
parties to it, but it is the abstract ratio decidendi, as
ascertained on consideration of the judgment in relation

to the subject matter of the decision, which alone has the
force of law and which, when it is clear what it was, is

binding; but, if it is not clear, it is not part of a tribunal’s
duty to spell out with difficulty a ratio decidendi in order
to be bound by it, and it is always dangerous to take one

or two observations out of a long judgment and treat
them as if they gave the ratio decidendi of the case. //
more reasons than one are given by the tribunal for its
judgment, all are taken as forming the ratio decidendi.”

[30] Salmond (“Salmond on Jurisprudence”, Twelfth Edition,
page 174), after having considered the extent to which Courts are
bound by previous decisions, proceeds to examine what
constitutes the decision in a case and what it is that is actually
binding on later Courts.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

Salmond puts it this way:

“First, however, we must distinguish what a case
decides generally and as against all the world from what
it decides between the parties themselves. What it

.

decides generally is the ratio decidendi or rule of law for

which it is authority: what it decides between the parties
includes far more than just this.” (Underlining
provided)

[31] Salmond talks of various methods of determining the ratio
which have been advanced thus far and takes into consideration
the “Reversal Test” of Professor Wambaugh, suggesting that we

of
should take the proposition of law put forward by the Judge,
reverse or negate it, and then see if its reversal would have
altered the actual decision. Salmond takes note of another test
suggested by Dr Goodhart. According to it, the ratio is to be
rt
determined by ascertaining the facts treated as material by the
Judge together with his decision on those facts.

[32] Rupert Cross (Precedent in English Law, Third Edition)
deals with both the above-said tests, namely, the Wambaugh
Test and Dr Goodhart Test. On page 53 of his classical work, he
deals with Wambaugh’s Test rather elaborately and points out

that Wambaugh had stated the test in the following words :

“First, frame carefully the supposed proposition of law.

Let him then insert in the proposition a word reversing
its meaning. Let him then inquire “whether, if the Court

had conceived this new proposition to be good, and had
it in mind, the decision could have been the same If the
answer be affirmative, then, however excellent the

original proposition may be, the case is not a precedent
for the proposition, but if the answer be negative the
case is a precedent for the original proposition and
possibly for other propositions also, in short, when a
case turns only on one point the proposition or doctrine
of the case, the reason for the decision, the ratio
decidendi, must be a general rule without which the case
must have been decided otherwise.”

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

[33] Rupert Cross also makes a detailed reference to Dr
Goodhart’s method of determining the ratio decidendi and says
that, according to Dr Goodhart, the ratio decidendi of a case is
determined by ascertaining the facts treated as material by the

.

Judge, and it is the principle to be ascertained from the Judge’s

decision on the basis of those facts. The learned author points
out that this method of determining the ratio decidendi has the
great merit of paying more regard to the facts as seen by the

Judge than is provided by the Wambaugh Test.
[34] Rupert Cross, before dealing with Dr Goodhart’s method of
determining the ratio decidendi, takes note of the rule

of
enunciated by Lord Halsbury in Quinn v. Leathern, 1901 AC 495 at
page 506. In this decision, Lord Halsbury opines thus :

“A case is the only authority for what it actually decides.
I entirely deny that it can be quoted for a proposition that
rt
may seem to flow logically from it.”

[35] Turning to the case law in this country the reference firstly

shall have to be made to the Supreme Court decision in Dalbir
Singh & Ors. v. State of Punjab, AIR 1979 SC 1384, which says that
the only thing in a Judge’s decision, binding a party is the
principle upon which the case is decided and for this reason, it is

important to analyse a decision and isolate from it the ratio
decidendi. A Full Bench decision in State of Bombay v. Chhaganlal
Gangaram Lavar, AIR 1955 Bombay 1 (FB), being an F.B. decision,

says that, so long as the Supreme Court does not take a different
view from the view taken by the Privy Council, the decisions of

the Privy Council are still binding upon High Courts. Chief Justice
Chagia, while speaking for the Full Bench, points out that what
is binding is not merely the point decided but an opinion

expressed by the Privy Council, which opinion is expressed after
careful consideration of all the arguments and which is
deliberately and advisedly given. In the same context, a Full
Bench decision rendered by the Delhi High Court in Flying Officer
S. Sundarajan v. Union of India & Ors., AIR 1970 Delhi 29, merits
consideration as it gives a clear idea in respect of the ratio by
providing a negative formula and proceeds to say:

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

“Under Art. 141 of the Constitution, the law declared by
the Supreme Court is binding on all the Courts and
therefore, even the principle enunciated by the Supreme
Court, including its obiter dicta when they are stated in

.

clear terms, has a binding force. But when a question is

neither raised nor discussed in a judgment rendered by
the Supreme Court, no principle of a binding nature can
be deduced from it by implication.”

This, when presented in a positive manner instead of
negative, would show that when a question is raised,
discussed and decided in a judgment rendered by the

of
Supreme Court, the same shall be a principle of a binding
nature. Turning to a rather recent Supreme Court decision
in State of U. P. & Anr. v. Mis Synthetics & Chemicals Ltd. &
Anr., JT 1991 (3) SC 268, which takes into consideration,
rt
the Supreme Court decisions in Municipal Corporation of
Delhi v. Gurnam Kaur, (1989 (1) SCC 101) and in Shama Rao

v. State of Pondicherry, (AIR 1967 SC 1680) lays down that,
any declaration or conclusion, arrived without
application of mind or preceded without any reason
cannot be deemed to be the declaration of Law or

authority of a general nature binding as a precedent. This
negative test, when put in a positive manner, once again
would go to show that a declaration or conclusion arrived

at after the application of the mind and preceding cogent
reasoning cannot be ignored. Speaking regarding

precedents, this pronouncement says that the conclusion
which is not preceded by reasoning or rationale cannot be
deemed to be a law declared to have a binding effect as

contemplated under Article. Article 141 of the Constitution
of India. Once again, putting this in positive language, it
would mean that the conclusions preceded by reasoning
and rationale shall be deemed to be the law declared,
having a binding effect as contemplated under Art. Article
141 of the Constitution of India.

[36] The Supreme Court has made it clear that even if a question
is answered by necessary implication by the Supreme Court, then
also the answer cannot be ignored by referring to the decisions

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
appealed against and holding that the real question that must be
considered to have been answered was something else, and that,
what the Judges expressly decided or what they must be
considered to have decided by necessary implication would also

.

constitute precedents. This view of the Supreme Court has been

expressed unequivocally in Gopal Upadhyaya & Ors. v. Union of
India & Ors., AIR 1987 SC 413. The concluding portion of the
pronouncement may be extracted thus :

“When a question is answered expressly or by necessary
implication by the Supreme Court the answer cannot be
ignored by referring to the decision appealed against and

of
holding that the real question that must be considered to
have been answered was something else What the Judges
expressly decided or what they must be considered to
have decided by necessary implication by reference to the
rt
facts stated by the Judges themselves are what constitute
precedents.”

31. Similarly, the Hon’ble Supreme Court also held in

State of Gujarat & Ors versus Utility Users Welfare Association & Ors

2018 (6) SCC 21 that the Court has to apply “The Inversion Test”

to determine the ratio decidendi of a case. It was observed:

“113. In order to determine this aspect, one of the well-

established tests is “The Inversion Test” propounded inter
alia by Eugene Wambaugh, a Professor at Harvard Law
School, who published a classic textbook called “The Study

of Cases”56 in the year 1892. This 56Eugene Wambaugh,
The Study of Cases (Boston: Little, Brown, & Co., 1892)
textbook propounded inter alia what is known as the
“Wambaugh Test” or “The Inversion Test” as the means
of judicial interpretation. “The Inversion Test” is used to
identify the ratio decidendi in any judgment. The central
idea, in the words of Professor Wambaugh, is as follows:

“In order to make the test, let him first frame
carefully the supposed proposition of law. Let him

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
then insert in the proposition a word reversing its
meaning. Let him then inquire whether, if the court
had conceived this new proposition to be good, and
had had it in mind, the decision could have been the

.

same. If the answer be affirmative, then, however

excellent the original proposition may be, the case is
not a precedent for that proposition, but if the
answer be negative the case is a precedent for the

original proposition and possibly for other
propositions also. (Eugene Wambaugh, The Study of
Cases (Boston: Little, Brown, & Co., 1892) at pg. 17)”

of

114. In order to test whether a particular proposition of law
is to be treated as the ratio decidendi of the case, the
proposition is to be inversed, i.e., removed from the text of
the judgment as if it did not exist. If the conclusion of the
rt
case would still have been the same even without
examining the proposition, then it cannot be regarded as

the ratio decidendi of the case. This test has been followed
to imply that the ratio decidendi is what is absolutely
necessary for the decision of the case. “In order that an
opinion may have the weight of a precedent”, according to

John Chipman Grey (Another distinguished jurist who
served as a Professor of Law at The Harvard Law School),
“it must be an opinion, the formation of which is necessary

for the decision of a particular case.”

32. In the present case, if the proposition of law that ‘a

show cause notice is required to be issued to the surety before

forfeiture of his surety bonds in the absence of which the order is

bad is negated’, it will not make any difference to the judgment

in Narata Ram (supra) because the question of issuing show cause

notice before the forfeiture never arose before the Court in Narata

Ram (supra); hence, it is not the ratio decidendi.

::: Downloaded on – 09/05/2026 08:19:41 :::CIS

33. Therefore, the submission made on behalf of the

appellant that the notice was required to be served before the

.

forfeiture of the bond cannot be accepted.

34. It is undisputed that the main accused has absconded,

and he was declared a proclaimed offender. The appellant sought

time before the learned Trial Court to produce the accused, but

of
could not produce him. He has also not informed this Court that

he had succeeded in tracing the main accused or had produced
rt
him before the learned Trial Court. Therefore, the learned Trial

Court had rightly held that the appellant was liable to pay the

amount of ₹1,00,000/-undertaken to be paid by him in the bond

furnished before the Court. He has not furnished any reason

whatsoever in the reply filed by him showing that he had a

sufficient cause to seek a reduction of the amount undertaken to

be paid by him. He had also not assigned any sufficient cause for

the non-production of the accused and stated that he came to

know after receiving a notice from the Court that the accused had

absconded, which shows the casual attitude adopted by him. The

record shows that the appellant had failed to abide by the terms

and conditions undertaken by him that he would produce the

accused on each and every date of hearing. Therefore, the learned

::: Downloaded on – 09/05/2026 08:19:41 :::CIS
Trial Court was justified in imposing the penalty of ₹1,00,000/-

upon the appellant. There is no infirmity in the judgment/order

.

passed by the learned Trial Court requiring any interference from

this Court.

35. No other point was urged.

36. In view of the above, the present appeal fails and is

of
dismissed.

37. A copy of this judgment, along with the record of the
rt
learned Trial Court, be sent back forthwith. Pending applications,

if any, also stand disposed of

(Rakesh Kainthla)

Judge
04th May, 2026
(Kiran)

::: Downloaded on – 09/05/2026 08:19:41 :::CIS