Undoing the Policy Concession, The Supreme Court’s Rejection

of Policy-based Exclusion in Disability Appointments:
An Overview -Maya P.C. v. State of Kerala (2025 (3) KLT 558 (SC) = 2025 KLT OnLine 1996 (SC))

(By Akhil Kumar K.S., Vth Semester – B.A. LL.B.,  NUALS, Kochi)
E-mail : akhilkumarks2602@gmail.com      Mob.: 7727037331

Abstarct

“Disability need not be an obstacle to success,” said Stephen Hawking — but what
happens when the State itself becomes a barrier? ¹

This article discusses the recent Supreme Court judgement in the case of Maya P.C. v. State of Kerala (2025 (3) KLT 558 (SC) = 2025 KLT OnLine 1996 (SC)), pronounced by Hon’ble Mr.Justice Abhay S.Oka, on his retirement day. The Court herein struck down the Kerala government’s Government Order dated 3rd February 2016, and held that the impugned G.O. denied seniority and probation benefits to employees with disabilities appointed to supernumerary posts by the 2013 G.O. and excluded them from being considered on par with regular employees. The judgment has already had an impact, with the Kerala High Court referring to it in Austin Wilson v. Kerala Agricultural University (2025) to reaffirm the rights of a disabled petitioner. Despite the significance of such decisions, the rights of persons with disabilities (PwDs) in public employment remain under-recognized in India. This article begins with a brief historical overview of disability rights in the country and examines the legal framework governing disability appointments. The article further examines important court decisions before Maya P.C. and shows how they shaped inclusive service law. The article also compares international jurisdictions to explore potential reforms for India. It evaluates the judgment of Maya P.C. and its significance. The article concludes with suggestions and key takeaways from various jurisdictions for achieving real equality for persons with disabilities in employment.

I. Introduction: Backdrop of Disability Rights and Employment in India

The recognition of the rights of persons with disabilities (PwD)has been a long-standing debate in the socio-legal arena. It is important to understand the historical evolution of the present status, especially when official estimates at the start of the millennium observed India’s disabled population at about 21 million (2%). However, the World Bank suggests, between 5% and 8% (55-90 million).² It is also pertinent to note that about 15% of the world’s population, which is around one billion people, live with a disability, which makes them the world’s largest minority group.³ As per the research, around 80% of them are in developing countries such as India, which is continuously increasing with the world population.⁴ Hence, it becomes crucial to analyse this issue. The soul and heart of the Indian democracy, the Constitution, under Articles 14, 15, 16, and 21, lays the foundation for principles like equality and non-discrimination. Despite this, its effective application to PwDs remained sparse until recent legislative and judicial interventions.⁵

The first legislation was enacted in 1995, after 48 years of independence, the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995, which discussed the rights and welfare of PwDs. It covered various aspects including Education, Employment, Accessibility, and Non-discrimination. However, the Act was lacked modern approaches as it provided a narrow definition of disability which excluded people with mental or intellectual impairments. The Act was more welfare-oriented, and recognition of the rights was in the dark. It also provided weak institutional mechanisms, which led to poor implementation standards. Nevertheless, thePwD Act marked a turning point, as it was the first comprehensive law in India to recognize and address the diverse needs of PwDs. Several legislations that recognized the concept of disability were enacted therafter, such as, National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation, and Multiple Disabilities Act, 1999,⁶ Rehabilitation Council of India (Amendment) Act, 2000⁷, Additionally, the Juvenile Justice (Care and Protection of Children) Act, 2015 ⁸ includes provisions relevant to children with disabilities.

In 2007, India ratified the United Nations Convention on the Rights of Persons with disability (UNCRPD).⁹ Article 27 of UNCRPD “recognizes the right of persons with disability to work, on an equal basis with others; this includes the opportunity to gain a living by work freely chosen or accepted in the labor market and work environment that is open, inclusive and accessible to persons with disability”.¹⁰ The UNCRPD also prohibits all forms of discrimination, including employment discrimination, promotes opportunities for self-employment, promotes access to vocational training, and mandates reasonable accommodation in the workplace. However, it took ten years for the Legislature to enact a law on the modern understanding of disability. In 2016, the Rights of Persons with Disabilities Act ¹¹ was enacted, which repealed the 1995 Act, which, though late, showed our commitment towards the UNCRPD. This Act provided a wider and progressive definition of the concept of disability. It provides that, “person with disability means a person with long-term physical, mental, intellectual or sensory impairment which, in interaction with barriers, hinders their full and effective participation in society equally with others.”¹² This Act also expanded the recognized categories of disabilities, from 7 to 21 categories, and increased reservations in public employment from 3% to 4%, for people with benchmark disability (PwBDs) (disabilities exceeding 40%),and emphasized reasonable accommo-
dation, accessibility, and inclusive workplace practices. Further, Chapter 2 of the Act categorically provides rights and entitlements; hence, it is more rights-oriented.

Even with this legislative advancement, implementation gaps still persist. Many State policies and Government Order (G.O.), such as the unconstitutional 2016 G.O. of the State of Kerala, have been lambasted for undermining the rights of disabled employees by categorizing them into non-regular posts, which denied them the employment benefits such as seniority, promotion, and probation. The recent Supreme Court judgment in Maya P.C.
v. State of Kerala¹³ marked a critical intervention. It emphasized that State policies cannot override the statutory rights of PwDs provided under the Rights of Persons with Disabilities Act, 2016, particularly in relation to equitable employment and service benefits.

Present Legal Framework in India

Chapter IV of the Rights of Persons with Disability Act, 2016, provides for skill development and employment; it also directs for inclusive vocational training and prohibits discrimination in employment. Further, the Act promotes reasonable accommodations for persons with disabilities. It requires that organizations adopt equal opportunity policies, keep employment records, appoint grievance officers, and resolve complaints from persons with disabilities promptly. Moreover, it provides 4% reservation to PwBDs in all government jobs, with 1% each reserved for persons with blindness/low vision, persons with hearing disabilities, and persons with locomotor disabilities/cerebral palsy.¹⁴

Therefore, this Act brings Indian law in line with the UNCRPD while highlighting equality, dignity, and non-discrimination. Hence, understanding this legal framework provides a basis for analyzing how the judiciary has interpreted and enforced disability rights in employment. This leads to important precedents in several landmark cases, including the case of Maya P.C. v. State of Kerala.

II. The Evolution of Judicial Reasoning on Disability Quotas: Insights from Early Rulings to Maya P.C.

The judiciary has become more proactive and dynamic after the enactment of the 2016 Act. However, foundational aspects have been laid down by the pre-2016 judgments. In the case of Syed Bashir-ud-Din Qadri v. Nazir Ahmed Shah¹⁵, the Apex Court, in the context of the 1995 Act, reinforced the necessity of adhering to affirmative action policies to support and include PwDs into the workforce. This case affirms the judiciary’s role in upholding dynamic social laws and fostering an inclusive society. In another case of Government of India v. Ravi Prakash Gupta,¹⁶ the Apex Court rejected the State government’s rationale that identification of jobs was a prerequisite for reservation and appointment under Section 33  of the 1995 Act. The Court observed that identifying posts under Section 32 should occur simultaneously with reservation and appointment, provided Section 33, and it cannot be used to deny reservation benefits to eligible disabled persons.¹⁷ Under the 2016 Act, this scheme has been retained through Section 33 (Identification of Posts for Reservation) and Section 34 (Reservation).

Another landmark judgement was regarding the discrimination among the PwDs, the Supreme Court in the case of Deaf Employees Welfare Association v. Union of India,¹⁸ observed that, “there cannot be further discrimination between a person with disability of ‘blindness’ and a person with disability of ‘hearing impairment.’ Such discrimination has not been envisaged under the Disabilities Act.”¹⁹ The Court further held that all PwDs must receive equal legal protection, and hearing-impaired individuals deserve the same benefits as blind persons to preserve their dignity.

In the case of Union of India v. National Federation of the Blind,²⁰ the Court analyzed the calculation of 3% reservation given for the PwBD in the 1995 Act. It looked into the aspect of whether it refers to cadre strength or the number of vacancies. The Court held that 3% refers to a part of the total vacancies in the cadre strength. The court explained, “It is clear that while Section 33 provides for a minimum level of representation of 3 percent in the establishments of appropriate government, the legislature intended to ensure 5 percent of representation in the entire workforce, both in the public and private sectors.”This ruling was later reiterated in the case of Ajay Kumar Pandey v. State of Uttar Pradesh. ²¹ However, the legislative intent remained on paper and was never effectively implemented.

Since the enactment of the 2016 Act, the Supreme Court has delivered several landmark judgments recognizing and clarifying the rights of PwDs, particularly in employ-ment and promotion. In the case of Siddaraju v. State of Karnataka,²² the Supreme Court held that persons with disabilities are entitled to reservation in promotions for posts as enshrined under Section 33 of the 1995 Act. The Court rejected the State’s reliance on Indra Sawhney (1992) to bar such promotions, reaffirmed Rajeev Kumar Gupta v. Union of India²³, and held that once a post is earmarked for PwDs, it must be filled by them at all stages, including promotion, as the identification itself confirms that PwDs can perform the duties.

In the case of Reserve Bank of India v. A.K.Nair & others,²⁴ the Supreme Court held that the 1995 Act did not contain any express provisions for the reservation of PwDs serving the feeder cadre. However, provisions indicated that merely because an employee is living with a disability, they ought not to deny promotion.²⁵ The mere lack of an express mandate for reservation in promotion for PwDs did not exonerate the Government from keeping reserved vacancies on promotional posts. However, the 2016 Act removes that ambiguity as it specifically provides for reservation in promotion in accordance with the instructions issued by the Government from time to time, as provided under Section 34.The State of Kerala v. Leesamma Joseph²⁶ is another case that upheld the right of PwDs to seek reservations in promotions. It held that the recruitment mode does not disqualify PwDs from reservation in promotions; therefore, what matters is whether the individual is a PwD at the time of promotion, and the reservation must apply to direct recruitment and promotions, based on the total cadre strength, even if no separate rules exist.

In the case of Rajive Raturi v. Union of India,²⁷ the Supreme Court addressed the inaccessibility of PwDs, especially for visually impaired individuals. This case, originating from a PIL, led to significant reforms in the 1995 Act. The Court held that the right to accessibility isintegral tothe right to life, dignity, and freedom of movement. It also reaffirmed the mandates of accessible public transportation, accessible educational institutions, and national annual accessibility audits. This judgment is also significant as it highlights that PwDsare deprived of even basic facilities. The recommendations under this ruling saw changes like making every educational institute accessible for the disabled, making public transportation accessible to the PwDs, and most importantly, conducting yearly audits on institutions made accessible for PwDs and institutions yet to be made accessible.²⁸

In another recent case of Kabir Paharia v. National Medical Commission,²⁹ the Supreme Court observed that the constitutional assurance of equality is not merely formal but substantive; hence, it requires the State to take affirmative measures to ensure that PwD can meaningfully participate in all spheres of life, including professional education. It also emphasized that reasonable accommodation is not a matter of charity but a fundamental righten shrined under Articles 14, 16, and 21 of the Constitution. It is also provided explicitly under Article 5 of the UNCRPD.

The discussed cases expanded the scope of disability rights, particularly in employment. However,the case of Maya P.C. reflects the Court’s engagement with settled legal principles, testing their consistency and continued relevance in the evolving disability rights jurisprudence. Hence, it was crucial to understand the judicial developments in this area along with the legislative intervention.

III. Case Analysis of Maya P.C. v. State of Kerala (2025 (3) KLT 558 (SC) = 2025 KLT OnLine 1996 (SC)): Critical Appraisal and Implications

The case of Maya P.C. v. State of Kerala (2025 (3) KLT 558 (SC) = 2025 KLT OnLine 1996 (SC)),revisits an already settled legal question that has been conclusively addressed through a series of judicial pronouncements. The established principles governing this issue, as discussed in the preceding chapter, form the foundation for understanding the Supreme Court’s approach in this matter.

Facts of the case

The appellants, all persons with benchmark disabilities exceeding 40% (PwBDs), were initially engaged in various public institutions in Kerala temporarily under Rule 9(a)(i) of the Kerala State and Subordinate Service Rules, 1958, for 179 days. By G.O. dated 18 May 2013, the State created supernumerary posts to regularise 2,677 such employees appointed between 16 August 1999 and 31 December 2003, with the posts to be abolished upon retirement. Many appellants, relying on this G.O., resigned from other regular posts and were reappointed on probation, some completing probation and securing inclusion in seniority lists. However, a subsequent G.O. dated 3 February 2016 excluded them from probation declaration, seniority, and promotion, terming their appointments a policy concession. Aggrieved, the appellant challenged this and was allowed by the tribunal in 2019; however, the Kerala High Court’s division bench overturned it in 2021, holding that her appointment to a supernumerary post was only a policy concession and did not confer rights to promotion or seniority. Hence, the matter reached the Supreme Court.

Issues framed by the Court

1. Should persons with disabilities appointed under the 2013 G.O. to supernumerary posts be treated as regular employees?

2. Whether the 2016 G.O. validly restricted probation, seniority, and promotion benefits for such employees and is discriminatory and violates Articles 14 and 16 of the Constitution?

3. Do the restrictions in the 2016 G.O. violate the Rights of Persons with Disabilities Act, 2016?

4. Can the State withdraw benefits after employees relied on the 2013 G.O. and altered their position?

5. Did the High Court correctly apply the Uma Devi judgment to these appointments?

Reasoning

The Court addressed the primary legal issues by examining the impugned G.O., the 2013 G.O., legislative purpose, and the constitutional principles. The Court reasoned that the PwDs appointed under the 2013 G.O. ought to be regarded as regular employees, because the 2013 G.O. intended “regular appointment” and the appointees were placed on probation, which characterizes regular employment. The Court reiterated that the 2013 G.O. intended to extend permanent status to PwDs in employment who were appointed temporarily. Concerning the validity and constitutionality of the 2016 G.O., the Court concluded that it was discriminatory and in violation of Article 14 of the Constitution, reasoning that it was not possible to contravene what was granted expressly by the 2013 G.O. The Court also reasoned that because numerous appellants had depended on the primary order (2013), their subsequent order (2016) was not permissible. They changed their statuses (for example, resigning from other regular positions) in anticipation of receiving full employment benefits.

Regarding disability rights and detrimental reliance issues, the Court found that the 2016 G.O.’s restrictions violated the spirit of disability protection legislation and constituted an irrational withdrawal of promised benefits. The Court noted that several appellants had voluntarily resigned from regular government positions based on the assurance in the 2013 G.O. that they would receive regular appointments with full benefits. The Court further analyzed the High Court’s application of the State of Karnataka v. Uma Devi case.³⁰ At the same time, the judgment excerpt doesn’t detail the Court’s complete analysis of this precedent, the Supreme Court’s reasoning suggests that the High Court erred in treating these appointments as merely concessional, when the 2013 G.O. explicitly provided for “regular appointment” and not temporary appointment as provide in the Uma devi’s case, moreover, the appointees were placed on probation, distinguishing these cases from typical temporary or ad-hoc appointments that would fall strictly under Uma Devi’s restrictions.

Judgment

The Supreme Court allowed the appeals, holding that the 2016 G.O. was discriminatory  and violated Article 14. The Court ruled that PwDs appointed under the 2013 G.O. to supernumerary posts were regular employees entitled to probation, seniority, and promotion benefits. The subsequent G.O.attempting to withdraw these benefits was deemed unconstitutional and irrational, particularly since appellants had detrimentally relied on the original promise of regular employment.

Critical Appraisal and Implications

In Maya P.C. v. State of Kerala, the Supreme Court ruled that State policy concessions cannot infringe upon the statutory and constitutional rights of persons with disabilities (PwDs). The conflict arose with the issuance of a G.O. in 2016 which sought to abolish probation, seniority, and promotional benefits to PwDs who had been appointed as regular employees through a 2013 G.O. The Court found that the 2013 G.O. had granted vested rights to the PwDs by allowing probationary and permanent status which was granted for time served, and could not be retracted on the whim of a policy change. Thus, the claim of “regularised appointments” was treated as a mere “policy concession” and violates the constitutional mandate of Articles 14 and 16, which prohibit arbitrary and discriminatory inequalities among equals in the same situation.

A crucial aspect of the judgment’s strength is acknowledging legitimate expectation and detrimental reliance. Numerous appellants had resigned from secure government positions based on the 2013 G.O. and the State’s action, including such changes that could not be reversed without compelling justification, especially when the choices made involve vulnerable groups such as PwDs who are statutorily and constitutionally protected. The court also rejected the high court’s reliance on Uma Devi’s case, which Stated that employees not appointed through an unlawful recruitment process cannot be treated as entitled to the benefits given to the regularly appointed employees. The Supreme Court in this case clarified that the appointments made under 2013 G.O. were not irregular or casual engagements; they were consciously granted regular positions and hence outside Uma Devi’s framework on regularisation.

The Court adapted its reasoning in line with the Rights of Persons with Disabilities Act, 2016, which promotes equality, non-discrimination, and positive discrimination for PwDs. The judgment clearly demonstrates that State actions or measures undertaken for PwDs must adhere to statutory and constitutional frameworks, and any attempt to diminish or withdraw the benefits will face stringent judicial review. Its broader implication includes governance that includes PwDs and ensuring stability and permanence in public employment. It also resists attempts to reframe substantive benefits as temporary or removable policy concessions.

IV. Comparative Jurisprudence: State’s Obligations toward the Disabled Individual in the Employment Context.

While discussing the disability rights in employment under Indian law, it is essential to see how other jurisdictions have addressed the same challenge. Around the world, the role of the State has gradually shifted from offering mere concessions to ensuring genuine equality and dignity for PwDs. Understanding these global approaches can guide the shaping of India’s legal framework to better protect and promote the rights of PwDs in the workplace.

The United States

In the United States, the Americans with Disabilities Act of 1990³¹ is the principal legislation on PwDs. Title I of the Act prohibits employment discrimination and mandates “reasonable accommodation” unless it imposes undue hardship.³² It also mandates making existing facilities used by employees readily accessible to PwDs. The ADA’s interpretation in US Airways, Inc. v. Barnett (2002) ³³ underscored that accommodation duties are balanced against operational feasibility. Still, the default expectation is to include disabled individuals in the regular workforce. Further, the Equal Employment Opportunity Commission (EEOC) ensures that public and private employers follow anti-discrimination rules.³⁴

The United Kingdom

The United Kingdom, under the Equality Act, 2010,³⁵ imposes a proactive duty to make “reasonable adjustments.” This mandates employers to remove physical, procedural, and attitudinal barriers that disadvantage disabled workers³⁶ In the case of Archibald v. Fife Council (2004)³⁷ the House of Lords had extended this duty to include a reassignment to alternative roles without competitive interviews when necessary, which reflects a substantive equality approach. It further held that the respondent failed to make reasonable adjustments under the Disability Discrimination Act, 1995 (repealed by the Equality Act
of 2010; however, the fundamental concept of reasonable adjustment remained the same).

Canada

In Canada, the Canadian Human Rights Act of 1985³⁸ and provincial human rights codes prohibit discrimination and require accommodation to the point of “undue hardship,” which implies excessive cost or disruption to a business, excluding legally required disability facilities³⁹ The case of British Columbia (Council of Human Rights) v. British Columbia (Ministry of Forests),⁴⁰ also known as the Meiorin case, established the “duty to accommodate” as essential to substantive equality. The Court further held that workplace standards should be modified to facilitate PwDs to an extent that does not cause significant problems or disruption. Hence, the Court clarified that employers and service providers are obligated to adjust rules, policies, or practices to enable everyone to participate fully, including PwDs. This obligation applies to needs that are related to the grounds of discrimination.⁴¹

Australia

In Australia, the Disability Discrimination Act 1992⁴² prohibits direct and indirect discrimination in employment; the Fair Work Act 2009 consolidated and reinforced the employment aspect.⁴³ It provides that the employers must make reasonable adjustments, with exceptions only for “unjustifiable hardship.” The Act also prohibits discrimination based on disability, including in recruitment, promotion, training, and other aspects of employment.

It is important to note that the terms used in various jurisdictions regarding disability legislation, such as reasonable accommodation, reasonable adjustments, and duty to accommodate, are fundamental to ensure the principle of equality and non-discrimination enshrined in UNCRPD’s Article 5. Article 5(3) also uses the term reasonable accommodation, which shows how crucial it is to ensure equality and non-discrimination towards PwDs. Several other countries have similar legislation that provides reservations and employee benefits to PwDs; those mentioned above were prominent. A comprehensive compilation of such legislation from 143 countries is provided on the United Nations Department of Economic and Social Affairs Disability website⁴⁴

Key Takeaways and Recommendations

Though India has enacted a modern disability rights framework in 2016, while replacing the outdated 1995 Act, the foundational aspects from foreign legislation can be incorporated to enhance implementation and reinforce a rights-based approach. It will ensure that the law’s goals are achieved more effectively. India can learn key lessons from countries like the United States, the United Kingdom, Canada, and Australia in handling disability and employment. In the U.S., for example, the ADA and the EEOC enforcement demonstrate how effective it is to have a strong, independent body that can investigate complaints and take action when the rights of PwDs are violated. Therefore, India needs a stronger and more proactive, dedicated enforcement authority than the current grievance-based system under the Rights of Persons with Disabilities Act, 2016.

The U.K.’s Equality Act 2010 also places a proactive duty on employers to make “reasonable adjustments” to prevent discrimination before it even arises. This highlights that India should move away from a system that only reacts after a complaint is filed, and instead adopt a proactive model where regular audits help identify and remove physical, procedural, and even attitudinal barriers. Had such a system been in place, cases like Maya P.C. v. State of Kerala might never have arisen.

Canadian jurisprudence on the “duty to accommodate” put forward a clearly defined and narrowly interpreted “undue hardship” standard to prevent misuse by employers. It also ensures that workplace rules and job requirements are modified unless there is strong proof of in feasibility. Australia’s Disability Discrimination Act, 1992 also highlights the need for protection, particularly at every stage of employment, recruitment, training, promotion, and workplace culture. Hence, India should also expand its anti-discrimination duties to cover the entire employment relationship.

To conclude, these jurisdictions focus on mainstream workplace integration rather than over-reliance on quotas. This indicates that India should complement its reservation system with integration-focused measures such as incentives for inclusive hiring, accessibility certification, and targeted skill development programs. The government has notified numerous such programs; however, it lacks structural administrative backing, which may depreciate their value. Further, India also lacks a strong enforcement agency. For example, Rules 15(2) and 16 of the Rights of Persons with Disabilities Rules, 2017 mandate compliance with accessibility standards and their periodic review, but lack clear guidelines, enforcement mechanisms, or penalties, leaving the liability aspect uncertain. Similarly, Rule 38 outlines the complaint procedure before the Chief Commissioner or Commissioner, covering filing requirements, response timelines, hearings, ex parte powers, and disposal within three months.⁴⁵ However, it omits provisions on liability or penalties, weakening enforcement and limiting the overall effectiveness of these accessibility obligations.

V. Conclusion

The Supreme Court’s judgment in Maya P.C. v. State of Kerala (2025 (3) KLT 558 (SC) = 2025 KLT OnLine 1996 (SC)), shows how policy initiated at the State level, albeit under the guise of concessions, can undercut the substantive equality enshrined in the Constitution and the Rights of Persons with Disabilities Act, 2016. By holding the 2016 GO attempting to divest probation, seniority, and promotional advantages in favor of disabled employees invalid, the Court asserted that rights once conferred cannot be taken away in the name of policy concessions.

The judgment also strongly emphasized the principles of legitimate expectation and prejudicial reliance, which ensured that PwDs are not made to suffer because of an inconsistent or unfair State policy, emphasizing the requirement of fairness in administrative decision-making. The principle’s main aim is that discretion must be exercised reasonably in furtherance of public policy, public good, and for a public cause⁴⁶ Hence, by invalidating the GO, the Supreme Court also upheld this principle, and its impact is already being seen beyond this case. In Austin Wilson v. Kerala Agricultural University,⁴⁷ the Kerala High Court based itself upon Maya P.C. to protect the rights of a disabled petitioner, thus solidifying the jurisprudential basis for disability-friendly employment practices. These cases collectively deliver a straightforward constitutional message that PwDs cannot be second-class employees, and undoing their privileges will trigger strict judicial scrutiny.

Comparative jurisprudence of the United States of America, the United Kingdom, Canada, and Australia emphasizes that reservations and quotas are necessary. Still, they must be supported by strong enforcement mechanisms, proactive compliance obligations, and a reasonable accommodation culture. Though progressive in theory, India's law is weak in implementation, as it relies on complaints rather than a preventive approach. A shift toward active State responsibility, regular accessibility inspections, liability imposition, and measures that encourage integration, such as incentives for inclusive hiring and stronger enforcement agencies, would strengthen the promise of true equality.

Unlike the jurisdictions discussed, India is ahead in one key aspect by explicitly including reservations in promoting PwDs. However, this alone will not deliver on the constitutional guarantee of substantive equality. Such provisions are meaningless without reasonable accommodations and accessibility. They hold little value even when required as positive obligations because of poor implementation and the absence of accountability mechanisms. This reduces rights to mere symbolic entitlements instead of enforceable guarantees.

In this context, Maya P.C. is not just a probation, reservation, or seniority issue. It represents a significant change in the view that PwDs are employees like other employees. It emphasizes that disability rights are not favors or welfare policies. Instead, they are binding entitlements based on dignity, equality, and non-discrimination. The task is to ensure that this judicial vision is translated into administrative practice, where the State stops being a hindrance and acts as an enabler of equal opportunity.

Foot Notes

*The author gratefully acknowledges the help and guidance of Mr. A.Syed Ansari, PhD Scholar at NUALS, in the course of this research.

1. World Economic Forum, “World Disability Report,” (2011) at ix.

2. Human Development Unit, South Asia Region, “People with Disabilities in India: From Commitments to Outcomes” (The World Bank, 2009).

3. World Bank, “World report on disability” (2011) at 39.

4.   Ibid.at 25.

5. The Constitution of India, Arts. 14, 15, 16 and 21.

6. The National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (Act 44 of 1999).

7. The Rehabilitation Council of India (Amendment) Act, 2000 (Act 38 of 2000).

8. The Juvenile Justice (Care and Protection of Children) Act, 2015 (Act 2 of 2016).

9. Meera Shinoy, “Persons with Disability &The India Labour Market: Challenges and Opportu-nities”(International Labour Organization, December, 2011).

10. The United Nations Convention on the Rights of Persons with Disabilities, 2006, Art.)27.

11. The Rights of Persons with Disabilities Act, 2016 (Act of 49 of 2016).

12.  Ibid., S.2(s).

13. Maya P.C. v. State of Kerala (2025 (3) KLT 558 (SC) = 2025 KLT OnLine 1996 (SC) = 2025 SCC OnLine SC 1199).

14. Supra note 11, S. 34(1).

15. Syed Bashir-ud-Din Qadri v. Nazir Ahmed Shah (2010 (2) KLT Suppl.89 (SC) = (2010) 3 SCC 603).

16.  Government of India v. Ravi Prakash Gupta (2010 (3) KLT SN 40 (C.No.47) SC = 2011 AIR SCW 416)

17. CJP Team, “Indian laws pertaining to persons with disabilities”, Citzens for Justice and Peace, September 02, 2022, available at<https://cjporg.in/indian-laws-pertaining-to-persons-with-disabilit-ies/>(last visited on August 15, 2025).

18. Deaf Employees Welfare Association v. Union of India (2014 (1) KLT 416 (SC) = AIR OnLine 2013 SC 317), para.18.

19. Ibid.

20. Union of India v. National Federation of the Blind, (2013 (4) KLT SN 51 (C.No.45) SC = (2013) 10 SCC 772), para.34.

21. Ajay Kumar Pandey v. State of Uttar Pradesh, (AIRONLINE 2021 ALL 81).

22. Siddaraju v. The State of Karnataka, (2020 (1) KLT 698 (SC) = Civil Appeal No.1567/2017).

23. Rajeev Kumar Gupta v. Union of India, (2016 (3) KLT 263 (SC) = AIR 2016 SC 3228).

24.  Reserve Bank of India v. A.K.Nair & others, (2023 KLT OnLine 2069 (SC) = Civil Appeal No. 529/2023).

25. The Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995, (Act 1 of 1996), S.47(2).

26. State of Kerala v. Leesamma Joseph (2021 (4) KLT 191 (SC) = AIR 2021 SC 3076).

27.Rajive Raturi v. Union of India (2024 KLT OnLine 2688 (SC) = 2024 INSC 858).

28. Ibid.

29.Kabir Paharia v. National Medical Commission (2025 KLT OnLine 1872 (SC) = 2025 INSC 623).

30. Secretary, State of Karnataka v. Umadevi And Ors. (2006 (2) KLT SN 55 (C.No. 70) SC = AIR 2006 SC1806).

31. The Americans with Disabilities Act, 1990.

32.Ibid.at S. 1, 9 and 10.

33.US Airways, Inc. v. Barnett (535 U.S. 391 (2002)).

34. US. Equal Employment Opportunity Commission, “Prohibited Employment Policies/Practices” available at<https://www.eeoc.gov/prohibited-employment-policiespractices>(last visited on August 17, 2025).

35. Equality Act, 2010.                                                    

36, Ibid part 4, s. 98, 289, Sch.2,4, and 8.

37.Archibald v. Fife Council ((2004) UKHL 32).

38. The Canadian Human Rights Act, 1985.

39. Canadian Centre for Diversity and Inclusion Centre, “Overview of Human Rights Codes by Province and Territory in Canada” (January, 2018).

40. British Columbia (Council of Human Rights) v. British Columbia (Ministry of Forests), ((1999) 3 SCR 3).

41. Canadian Human Rights Commission, “Duty to Accommodate” available at:<https://www.chrc-ccdp.gc.ca/individuals/human-rights/duty-accommodate#:~:text=About%20duty%20to%20accommmodate,called%20the%20duty%20to%20accommodate.>(last visited on August 17, 2025).

42. The Disability Discrimination Act, 1992.

43. The Fair Work Act, 2009.

44. Department of Economic and Social Affairs Disability, “Disability Laws and Acts by Country/Area”,United Nations,available at: <https://www.un.org/development/desa/disabilities/disability-laws-and-acts-by-country area.html>(last visited on August 17, 2025).

45. The Rights of Persons with Disabilities Rules, 2017, r. 15(2), 16 and 32.

46. Foram R. Patel and Rishin Patel, “The Doctrine of Legitimate Expectation: From Development in England to Indian Scenario” Winter Issue, Indian Law Institute Law Review 139 (2011).

47.  Austin Wilson v. Kerala Agricultural University (W.P.(C) No.12236/2025).

LEGALLY ENFORCEABLE DEBT" UNDER THE NEGOTIABLE INSTRUMENTS ACT VS. SECTION 269SS: A CRITICAL ANALYSIS OF THE KERALA HIGH COURT'S JUDGMENT IN P.C. HARI V. SHINE VARGHESE (2025 (4) KLT 608 = 2025 KLT OnLine 2488 = 2025 SCC ONLINE KER 5535)

(By Sangeeth Krishna G.S., Advocate, High Court of Kerala)

E-mail : sangeethkgs21@gmail.com                                                           Mob.: 9496752399

Section 269SS of the Income-tax Act was designed to catch black money and not to erase bona fide debts. Thus,it is a regulatory measure aimed at curbing undisclosed cash flows and not to extinguish any civil obligations. Unfortunately, the Kerala High Court’s approach in P.C.Hari v. Shine Varghese (2025 (4) KLT 608 = 2025 KLT OnLine 2488), wrongly interprets Section 269SS and consequently treats mode-of-payment breach as sufficient to extinguish civil obligations. As a result, it expands a fiscal safeguard into a mechanism to invalidate a contract.Consequently, the judgment erects an evidentiary hurdle that transfers the burden to the lenders, whereby, opens the risk of penalising creditors and blatantly undermines the statutory objectives of Section 269SS and the Negotiable Instruments Act.

Picture a lane marked with a bright, strictly enforced sign saying that the maximum permissible speed limit for the Cars is 20 km/h. Now, if a Driver drove faster than the permissible speed limit, he will be liable to pay a fine. Undoubtedly, overspeeding is an offence in itself, but the very same offence of over speeding, even though is liable for penalty, would not thereby make the car unlawful.Likewise, Section 269SS of the Income-tax Act fines cash loans which cross the ₹20,000 mark, but the loan itself isn’t invalid.

Now imagine a military zone with sharp fences and a flashing red light saying “No Entry”. A woman refuses to obey the above warning and trespasses into the property. Inside the property, she was raped. Her illegal act of trespass, doesn’t fade the rapist’s crime.Similarly, a cash loan which violates Section 269SS of the Income-tax Act, does not extinguish the repayment right nor makes the debt legally unenforceable.

Having said the above facts, now let us shift our attention back to the recent judgment in P.C. Hari v. Shine Varghese (2025 (4) KLT 608 = 2025 KLT OnLine 2488 = 2025 SCC OnLine Ker.5535), by the Kerala High Court which interpreted Section 269SS of the Income Tax Act and decided that any cash loan above ₹ 20,000 without any sufficient reason for the transaction through cash,can be branded “illegal”. Thus, the Court disqualifies such loan from being a “legally enforceable debt”,under the Negotiable Instruments Act. Although the ruling refrains from annulling all cash advances above the threshold, it effectively requires the complainant seeking to enforce the bounced cheque to justify the loan through indisputable evidence. Yet this configuration skews the statutory design and distorts settled doctrine. Section 269SS, enacted to counteract tax evasion, was never intended to invalidate bona fide credit arrangements.

This article dissects the judgment and offers an alternative view anchored in parliamentary purpose, legislative history, and series of authoritative pronouncements from the Supreme Court and the various High Courts which have consistently drawn the boundaries between tax policy and bona fide credit transactions.

Statutory Framework and Legislative Purpose Behind Section 269SS

Enacted by the Finance Act of 1984 and effective from July 1 of that year, Section 269SS bars the acceptance of single loans or deposits aggregating ₹ 20,000 or more, unless the amount moves by way of a bank draft or an account-payee cheque. In Assistant Director of Inspection (Investigation) v. A.B.Shanthi (2002 (2) KLT OnLine 1007 (SC) = (2002) 6 SCC 259), the Supreme Court elucidated the legislative objective of Section 269SS.The Honourable Court stated that this provision was introduced to target a specific problem that the income tax authorities faced during tax raids.During tax raids, assessees introduced concealed cash into their books of account as fictitious loans, fortified by confirmatory letters. This resulted in the introduction of Section 269SS.Earlier, a violation of Section 269SS attracts Criminal charges under Section 276DD, but later this section was repealed and only a purely civil penalty was imposed under Section 271D.

It is crystal clear that the statute directs attention solely to the borrower, levying a civil penalty without invalidating the financial transaction itself. Thus, the objective of Section 269SS is to secure the revenue, rather than to impair the enforceability of civil claims or to modify the enforceability of Contract established by the Indian Contract Act or the Negotiable Instruments Act.

Supreme Court Endorsement: Penalty, Not Nullity

Paragraph 8 of Assistant Director of Inspection (Investigation) v. A.B.Shanthi (2002 (2) KLT OnLine 1007 (SC) = (2002) 6 SCC 259) read as, “……The object of introducing Section 269-SS is to ensure that a taxpayer is not allowed to give false explanation for his unaccounted money, or if he has given some false entries in his accounts, he shall not escape by giving false explanation for the same. During search and seizures, unaccounted money is unearthed and the taxpayer would usually give the explanation that he had borrowed or received deposits from his relatives or friends and it is easy for the so-called lender also to manipulate his records later to suit the plea of the taxpayer. The main object of Section 269-SS was to curb this menace. As regards the tax legislations, it is a policy matter, and it is for Parliament to decide in which manner the legislation should be made……” 

Further, in the same judgment, it was held that Parliament correctly opted for civil penalties under Section 269SS, attaching the penalty only to the borrower. This decision also brought Section 273B into focus, which allows the borrower to waive of the penalty on proof of reasonable cause for the cash acceptance. 

Consequently, from the above judicial interpretation, it is clear that the Section 269SS is a rule of fiscal regulation, not a rule that questions the validity of otherwise authentic credit arrangements. Moreover, this section is aimed squarely at curbing unrecorded cash transactions and fostering tax transparency and not to invalidate bona fide private loans.The statutory framework therefore does not classify a departure from Section 269SS as a declaration that the underlying transaction is illegal or void, instead it imposes a financial penalty to deter non-compliance.

Judicial Consensus: Cash Loans Are Not Void or Unenforceable 

Another important aspect is that various High Courts have consistently held that a cash loan given in breach of Section 269SS remains enforceable.

• Delhi High Court

In Sheela Sharma v. Mahendra Pal (2016 (3) KLT OnLine 2485 (Del.) = 2016 SCC OnLine Del.4696),the Court affirmed the enforceability of a cash loan for ₹10 lakh and observed that the breach of Section 269SS exposes the lender solely to the civil penalty prescribed in Section 271D. The violation neither vitiates the loan agreement nor bars the lender from proceeding under Section 138 of the Negotiable Instruments Act.

Paragraph 24 of the judgment read as, “The mere advancement of the loan in cash, may entail consequences for the party acting in breach of Section 269SS of the Income Tax Act. That is not the concern of this Court. Whether, or not, the appellant reflected the availability of the said amount in her income-tax returns, is also not a matter of concern for this Court. That would again be an aspect to be considered by the income-tax authorities. The advancement of loan, in cash, to the tune of ₹10 Lakhs is not prohibited in law. The transaction of advancement of loan of ₹10 Lakhs, in cash, does is not illegal. Such a transaction is enforceable at law.” 

This judgment clearly confirms that, questions of tax compliance and the enforceability of contracts are two separate aspects. Thus, the ability to pursue remedies under Negotiable Instruments Act remains intact even when the transaction may contravene provisions of tax law.

• Karnataka High Court

In Mohammed Iqbal v. Mohammed Zahoor (2007 (3) KLT OnLine 1156 (Karnt.) = 2007 SCC OnLine Kar.282), the Karnataka High Court decisively ruled that breaching Section 269SS does not make a cash loan illegal or unenforceable. By citing the findings of the Supreme Court in Asst.Director of Inspection Investigation v. A.B.Shanthi (2002 (2) KLT OnLine 1007 (SC) = 2002) 6 SCC 259), the High Court held that the Section governs the method of payment solely to deter tax-fraud practices, leaving genuine credit arrangements firmly on the books.

Paragraph 7 of the judgment read as, “In the light of the observations of the Apex Court, it cannot but be said that Section 269-SS only provided for the mode of acceptance payment or repayment in certain cases so as to counteract evasion of tax. Section 269-SS does not declare all transactions of loan, by cash in excess of ₹ 20,000/- as invalid, illegal or null and void, while as observed by the Apex Court, the main object of introducing the provision was to curb and unearth black money. To construe Section 269-SS as a competent enactment declaring as illegal and unenforceable all transactions of loan, by cash, beyond ₹ 20,000/-, in my opinion, cannot be countenanced.”

The High Court of Karnataka further held that, reading Section 269SS as voiding all cash loans in excess of ₹20,000 would exceed the statute’s reasonable application and lacks legal footing. Provisions meant to compel fiscal transparency must not be misapplied to frustrate genuine civil obligations or private credit transactions. 

• Madras High Court

In K.T.S. Sarma v. Subramanian (2001 (2) KLT OnLine 1062 (Mad.) = 2001 (4) CTC 486),

the Court held that, if there is no intent to subvert the statute, a minor breach of Section 269SS does not compromise the enforceability of the loan.

• Bombay High Court

In Prakash Madhukarrao Desai v. D.S.Desai (2023 KLT OnLine 2724 (Bom) = (2023) 458 ITR 174), the High Court reiterated that the presumptions of Sections 118 and 139 of the Negotiable Instruments Act are preserved even if the complainant does not record the loan in their accounting books or in their income tax filings. The Court further observed that even if there is violation of Section 269SS, those are breaches of tax procedure only, rather than substantive obstacles to the enforceability of the loan. 

• Delhi High Court

Birmala Projects Pvt. Ltd. v. Ashwani Ahluwalia (2016 SCC OnLine Del.4696), the Delhi High Court confirmed that Sections 269SS and 269ST do not operate to void civil contracts. These are regulatory provisions directed towards the discouragement of tax avoidance. The Court further distinguished a penal statute from one that explicitly voids a contract and held that cash transactions remain recoverable, unless explicitly invalidated by any statute.

When a Single Bench Overrules Itself

In Sugunan v. Thulaseedharan (2015 (2) KLT SN 21 (C.No. 30) = 2014 SCC OnLine Ker.22592), the Kerala High Court stated that an infraction of tax law, does not nullify the validity of a civil obligation and further stated that cash loans in breach of Income Tax Act 269SS remain enforceable under NI Act 138.

The Supreme Court in Shabna Abdulla v. Union of India (2024 (5) KLT 30 (SC) = 2024 SCC OnLine SC 2057), ruled that, if a Division Bench feels an earlier coordinate bench’s judgment is incorrect, “the only option available to it was to refer the matter to a larger Bench”. Thus, the Supreme Court clearly stated that High Courts must decide cases on the law as it stands and may not ignore or overturn an earlier same-strength bench’s ruling and the only option available to it was to refer the matter to a larger bench.

Despite the above clear mandate by the Apex Court, in P.C. Hari v. Shine Varghese, (2025 (4) KLT 608 = 2025 KLT OnLine 2488 = 2025 SCC OnLine Ker.5535), the Kerala High Court has not followed the above dictum from the Supreme Court and consequently departed from its own earlier ruling in Sugunan v. Thulaseedharan (2015 (2) KLT SN 21 (C.No. 30) = 2014 SCC OnLine Ker.22592). This overruling of its own former settled position of lawby the Coordinate Bench of the Kerala High Court violates the Supreme Court’s doctrine of judicial discipline and the binding-precedent rule, which blatantly renders the decision of Kerala High Court in P.C. Hari v. Shine Varghese (2025 (4) KLT 608 = 2025 KLT OnLine 2488  = 2025 SCC OnLine Ker. 5535) legally unsound.

Conclusion

The decision of Kerala High Court in P.C. Hari v. Shine Varghese (2025 (4) KLT 608 = 2025 KLT OnLine 2488 = 2025 SCC OnLine Ker.5535), neglects both the intention of the Legislature and its objective in introduction of the Section 269SS in the Income Tax Act. 0DFurther, it also violates the Supreme Court’s direction to the High Courts that it must decide cases on the law as it stands and may not ignore or overturn an earlier same-strength bench’s ruling and the only available option to it was to refer the matter to a larger bench. Hence, the Kerala High Court’s Judgment in P.C. Hari v. Shine Varghese (2025 (4) KLT 608 = 2025 KLT OnLine 2488 = 2025 SCC OnLine Ker.5535) is undoubtedly a walk in the wrong path, which is away from the established legal precedent and is accordingly bad in law.

“A technicality should not become a sword to defeat justice.”

ARTIFICIAL INTELLIGENCE : A WALK-THROUGH PATHWAY OF LAW

(By Jouhara Rinshad, Advocate, Calicut)

E-mail : adv.jouhararinshad@gmail.com                                                     Mob.: 9496526860

The future of legal profession without AI software’s is hard to believe. From journals and reporters to CD-ROMS and Online software, legal technological innovation has changed the way how legal services were rendered. The technological advancement in the legal profession has transformed the framework. Legal research is the most important aspect of practicing lawyer and because of technology, it has undergone a drastic development.  AI software helps the lawyer to find relevant case laws and applicable statutes. With this software complex legal questions can be answered in simple and basic language. Effective using of AI technologies will be able to offer services at lower cost, higher efficiency, and with higher odds of favourable outcomes in litigation.  AI can be used to very quickly produce initial drafts, citing the relevant case law, advancing arguments, and rebutting arguments. For example, we can now see the spur of opportunities in new legal tech companies with the use of AI legal assistant Cocounsel, Case text etc. Law schools should update their curriculum to ensure that they provide law students with instruction in how to use AI writing and research tools, as these skills will be in high demand among recruiters. Even with the adoption of AI, lawyers’ role will still be vitally important.  AI cannot replace a lawyer’s role in court. AI can’t make a convincing presentation before a judge. It can’t replace the human element of relationships with clients.

AI AND APPLICATIONS OF AI IN THE LAW FIELD:

Artificial intelligence is a field in computer science that results in the creation of a machine that could analyse data, think, speak, recognize, make independent decisions, solve complex problems, learn, even feel and react without any human help. In simple terms, AI is the capability of a machine to imitate intelligent human behaviour. The objective behind the development of AI is the demand and need for automation. The hum-drum monotonous tasks performed by human workforce across the world can be easily automated by utilizing AI and these further aids human beings to perform better in handling critical and complex tasks and situations. Some of the ways in which AI is being used and proving to be beneficial for the lawyers and law firms respectively are discussed below:

1. Legal Research:

Legal research is an activity that is time consuming and a lot of legal practitioners face the challenge of not having enough time. This challenge is addressed with the help of AI software and other technologies which has made legal research not only faster and easier but more accurate than ever. The large online legal data resources like LexisNexis as well as Practical Law have regularly been enhancing their search algorithms to aid lawyers in discovering appropriate case-related material.

2. Accelerate Due Diligence:

Uncovering background information through the due diligence process is another time-consuming process that legal practitioners spend their time on. During the process of due-diligence legal practitioners are required to review hundreds or thousands of documents that have not been organized and stored in any number of file formats. Organizing and converting all of the documents is a time-consuming process. However, with the help of AI solutions, the same is done at a much faster speed with more accuracy. Studies have shown that AI systems and machine-learning technology do the work of reviewing documents accurately in half the time.

3. Contract Review:

Contracts serve as the backbone of our economic structure; they are indispensable for any business transaction. However, the whole procedure of mediating and yet the process of negotiating and settling a contract is a dreary hassle. The lawyers from both parties are required to manually inspect, refine, and swap red-lined documents in a repetitive manner. By adopting natural language processing (NLP) technology, and decide which aspects of the contract are agreeable and which of them pose an issue.

4. Contract Analytics:

Post the signing of the contract, overseeing and supervising it can prove to be a pain.  Especially in the case of big firms that have extensive pending contracts and a wide number of counterparties across various divisions. Various NLP-powered solutions have started being developed which derive and appraise crucial data across a firm’s core of contracts, simplifying the firm’s business commitment nature for its stakeholders.

5. Litigation Prediction:

Various AI teams have started developing machine learning models for predicting the results of imminent cases by taking into account the factual pattern of the case as well as the bulk of relevant paradigms. Various law firms and businesses have started adopting these models to properly prepare their litigation approaches, speed up settlement negotiations as well as reduce the number of cases that get required to be forwarded to trial.

6. Legal Analytics:

AI software furnishes judgments and precedent law to be used by legal practitioners in their present cases. The device detects relevant patterns to find correlations in new inputs. By this mechanism correlation between the instant case and similar precedents can be established.

7. Prediction Technology:

Artificial intelligence legal software helps in predicting the probable outcome of a pending case with remarkable accuracy. It has proven to be extremely useful in rapidly identifying patterns in cases that lead to certain outcomes. Research have shown that computers can do a better job than legal academicians at predicting Supreme Court decisions, even with less information.

8. Chatbots:

Bots can prove to be highly effective in offering legal help and in providing the masses with easy access to services.  A lawyer bot is basically software that has the capacity of carrying out automated tasks which generally get performed by lawyers. These bots are useful for boosting the speed of the work and in offering an enhanced experience by enabling the clients to self-serve themselves online. Also, AI chat bots are also effective in predicting case outcomes, preparing the documents swiftly through automation, formulating the invoices for clients, as well as for a range of other tasks.

9. Electronic Billing:

AI legal software helps in preparing the invoices for the legal practitioners as per the work done by them. It makes accurate adjustments of the work done by the legal practitioner.

LEGAL CHALLENGES OF AI:

The dramatic rise of AI, impacted on the financial, legal, healthcare, mobility, and many other sectors. However, there were also some defining events that happened for AI, such as the Uber’s self-driving car caused a car accident that ended in the death of a pedestrian, which addressed a question of liability. Some of the several legal challenges of AI are discussing below:

1. Contract law:

AI could also be used for contract negotiation and execution. AI is already capable to recognize standard clauses, identify patterns, suggest alternatives, extract data from the contract, etc. With a contract management system, which is based on AI, companies are able to review contracts more rapidly, organize large amounts of contract data more easily, decrease the potential for contract disputes and also increase the volume of contracts being negotiated. AI will be soon able not only to store, manage, extract data, but also to analyse patterns and data, and propose the best negotiation options for parties. When the technology reaches its the point where contracts will be made mostly by robots, contractual law will have to change significantly and address questions of formation, modification, execution, enforceability, jurisdiction, notaries and authentication, and more.

2. Intellectual Property Rights:

AI will certainly have an impact on the traditional concepts of intellectual property. For example, Music that is generated by AI and other inventions, which will surely transform the definitions of “authors”, “inventors”, “artists”, and the concepts of patents, trademarks, copyrights, designs, etc. The current legal definitions of creativity and innovation do not take into consideration non-human innovation.

3. Liability:

The current legal framework does not have rules, under which robots shall be held liable for their acts or omissions that cause damage to third parties. Robots can be so complex that it is questionable whether ordinary rules on liability are sufficient. This is so especially in cases where the cause cannot be traced back to a specific human and where the acts or omissions of robots which have caused harm could have been avoided. More to this, there is also a shortcoming in the current legal framework of the contractual liability. In cases, where machines are able to choose their counterparts, negotiate contractual terms, conclude contracts and decide whether and how to implement them, the traditional rules might be insufficient.

4. Protection of data privacy & private life:

For machine learning, the free flow of data is essential in order to utilize robots to their full potential. For that, it is important, that robots are developed in such a way that they are safe, secure and fit for purpose and follow procedures for data processing, which must be compliant with existing legislation, confidentiality, anonymity, fair treatment, and due process. There must be a sufficient security layer in the networks in which robots operate to prevent security breaches, cyber-attacks or misuse of personal data, especially when a large amount of data is collected and processed. There should be mechanisms that enable users to stop processing their personal data and to invoke the right to be forgotten.

5. AI Personhood:

Personhood is a quality of being an individual person, having rights and obligations. It is a quality that every natural or legal person has. Personhood means that whenever there is a car accident, there is also a natural or legal person behind it who will be held liable for the consequences of the accident. The question is should a machine be given personhood (rights and liabilities) in a same or similar way as natural and legal persons have it, but with its own specific features and implications.

CONCLUSION:

While Artificial Intelligence in the legal industry has garnered a lot of focus and spotlight the technology still remains in the initial stage giving it the scope to invite both opportunities as well as challenges.  It is vital that we approach the new technology with care and consider all legal and also ethical applications and effects.

Operation Asha v. Shelly Batra (2025 KLT OnLine 2625 (SC)):
A Critical Appreciation of the Landmark Judgment on S.92, C.P.C.

(By Saji Koduvath, Advocate, Kottayam)
E-mail : sajikoduvath@gmail.com                                                                Mob.: 9400230025

Introduction

The Supreme Court decision, Operation Asha v. Shelly Batra (2025 KLT OnLine 2625 (SC) delivered on 05 August 2025), will be a significant and impactful judgment in the history of Indian law.

Reflection on Two questions of Critical Significance

The decision, Operation Asha v. Shelly Batra (2025 KLT OnLine 2625 (SC)), prompts reflection on two questions of critical and profound significance. They are:

• 1.Can aninstitution/organisation be considered as a ‘trust’ or a ‘constructive trust’?

• 2. Is it possible for a Registered Society –

      •(i) to create a trust upon the properties that have been acquired by the society after its registration, and

      •(ii) to ‘vest’ its properties in a ‘trust’ to have scrutiny thereof under Section 92 CPC?

The reflections of this author, in a nutshell, are the following –

• It is a misconception to match or equate a Trust with an Institution or Organisation.

• A trust cannot be created upon the “property belonging to a society”. But it is subject to certain exceptions.

Why it is a Misconception to Equate a Trust with an Association

• 1. In Indian law, a trust is not recognised as a legal entity—it is neither a person nor an institution. A trust, in law, is an ‘obligation’ imposed upon the trustees to manage and administer the trust property for the benefit of the beneficiaries; whereas, a Society is an association of individuals. Both are fundamentally distinct. (One is a concept and the other is a reality.) Any attempt to blend the legal character of a trust with that of a Society would run contrary to their distinctive legal frameworks and is totally inconsistent with established principles of jurisprudence.

• 2. Property of a Society vests in its Members subject to the contract (Bylaws) and the basic or essential principles upon which it is founded.

Why No ‘Trust’ in a “Property Belonging to a Society”

• 1. Under Indian law, members of a Registered Society are not permitted to ‘dedicate’ property belonging to the society, as the Society Registration Act, 1860, comprehensively governs the vesting and management of such property. As per Section 5 of the Act, if the property is not vested in trustees, it automatically vests in the Governing Body of the Society. Furthermore, the Act itself prescribes the procedure for dealing with the society’s property upon its dissolution. Any attempt by the members to transfer such property outside this legal framework will stand inconsistent with the statutory scheme and is therefore impermissible.

• 2. Section 92 CPC envisages ‘express or constructive trust’. This requirement is brought home only when there is dedication of property.

• Note: The “property belonging to a society” cannot be dedicated, after its Registration, even by a unanimous decision of its entire members, because the Society Registration Act governs the ‘vesting’, as stated above.

• 3. Societies, both registered and unregistered, are voluntary associations of persons. Article 19(1)(c) of our Constitution guarantees freedom to form associations and unions. It includes in itself the right of effective functioning so as to achieve its lawful objectives.

• 4. Since the Civil Courts’ jurisdiction to interfere in the internal affairs of a Society is well-defined by the Societies Registration Act and common law, the LAW does not envisage interference upon the “property belonging to a society” under Section 92 CPC.

‘A Trust’ is “An Obligation” and Not a Legal Entity

‘A trust’, according to the definition, being ‘an obligation’, it is clear that ‘a trust’ does not convey the idea that the ‘trust’ is a legal person, an association of persons, or a tangible or corporeal property. The following are the important decisions on this point.

• Govt. of the Province of Bombay v. Pestonji Ardeshir Wadia: (AIR 1949 PC 143);

• Thiagesar Dharma Vanikam v. C.I.T.(1962 KLT OnLine 1182 (Mad.) = AIR 1964 Mad. 483 = 1963- 50 ITR 798 (Mad.));

• Ramdass Trust v. Damodardas(1967 Raj. LW 273);

• Duli Chand v. Mahabir Pershad Trilok Chand Trust(AIR 1984 Del 144);

• Thanthi Trust v. Wealth Tax Officer(1989- 45 TAXMAN 121 = 1989-178 ITR 28);

• Chikkamuniyappa Reddy Memorial Trust v. State(1997 (1) KLT OnLine 1137 (Karnt.) = ILR 1997 Kar. 2460);

• Kishorelal Asera v. Haji Essa Abba: (2003-3 Mad LW 372 = 2003-3 CCC367);

• Sagar Sharma v. Addl. CIT: (2011-239 CTR 169 = 2011-336 ITR 611);

• Sambandam v. Nataraja Chettiar(2012-1 Mad LW 530).

Bylaws Bind as Contract

The members of a club or society, both registered and unregistered, are bound by the memorandum of association and its rules and regulations. The bylaws bind its members as a contract. Even the formation of a society itself is based on a contract. When a person becomes a member of the society, he would have no independent rights, and lose his individuality qua the society except those that are given to him by the statutes concerned and bye laws; and the rights of members merge in the rights of the society. In State of U.P. v. CD Chheoki Employees Co-operative Society (1997 (1) KLT OnLine 1026 (SC) = AIR 1997 SC 1413), our Apex Court explicated it with the analogy thatthe stream cannot rise higher than the source.It reads:

“Thus, it is settled law that no citizen has a fundamental right under Article 19(1)(c) to become a member of a Co-operative Society. His right is governed by the provisions of the statute. So, the right to become or to continue being a member of the society is a statutory right. On fulfillment of the qualifications prescribed to become a member and for being a member of the society and on admission, he becomes a member. His being a member of the society is subject to the operation of the Act, Rules and bye-laws applicable from time to time. A member of the society has no independent right qua the society and it is the society that is entitled to represent as the corporate aggregate. No individual member is entitled to assail the constitutionality of the provisions of the Act, Rules and the bye-laws as he has his right under the Act, Rules and the bye-laws and is subject to its operation. The stream cannot rise higher than the source.” (Quoted in Zoroastrian Co-op. H. Society Ltd. v. District Registrar (2005 (2) KLT SN 74 (C.No. 88) SC = AIR 2005 SC 2306); Supreme Court Bar Association v. BD Kaushik: (2011 (4) KLT SN 64 (C.No.71) SC = (2011) 13 SCC 774); Chandigarh Housing Board v. Devinder Singh (AIR 2007 SC 1723).

Instances Where a Society Falls Under the Clutches of S. 92 CPC

Section 92 CPC envisages ‘trust’ in a general, and not in a restrictive, sense as it refers to ‘express or constructive trust created for public purposes of a charitable or religious nature’. The following are the instances of imposing ‘trust’ (upon the property of a Society) to be subjected to the jurisdiction under Section 92 CPC:

1. If a charitable institution is established by an association of persons through a valid dedication of property, it acquires the character of a trust for a public purpose within the meaning of Section 92 of the CPC. The subsequent registration of the association under the Societies Registration Act will not alter or extinguish its trust, which had arisen from the original act of dedication and the charitable purpose it serves. 

• Note: 1. Such property cannot be treated as the property ‘belonging to’ the association. (The property of a society is described in Section 5 of the So. Regn. Act as the property ‘belonging to the society’.)

• 2. Beneficiaries of such a public trust will be outsiders (other than the members of the association) or, at least, outsiders must also be the beneficiaries.

2. If it is manifested from the nature of an association (Society or a Non-Trading-Company) that a property held by such an institution is meant for the benefit of the third parties or public, i.e., other than the members of the association.

3. If a society is formed with the object of dedicating property for a public charitable or religious purpose, and if the property is so dedicated and a trust is predicated.

4. If the society accepts a gift of a property with the obligation to manage the same for the benefit of the beneficiaries intended by the donee.

Trust is Created if Property Gifted on Conditions, to a Regd. Society

The Supreme Court, in Swami Shivshankargiri Chella Swami v. Satya Gyan Niketan (2017 (1) KLT OnLine 2037 (SC) = (2017) 4 SCC 771 = AIR 2017 SC 1221), considered whether
a trust would arise when the donor waqfed (gifted) property to a society, registered under the Indian Societies Registration Act, 1960, for the development and publicity of the Hindi Language. The property was gifted on condition that the society would not have the right to mortgage or the right of sale. The society had not been taking any interest in achieving the purpose. Therefore, a petition was filed under Section 92 of CPC. The district judge allowed the petition, observing that prima facie it appeared that a constructive trust was created. The district judge relied on the Kerala High Court decision in Sukumaran v. Akamala Sree Dharma Sastha (1992 (1) KLT 432 = AIR 1992 Ker.406).The High Court, in Revision, reversed the order of the district judge. The matter was finally considered by the Apex Court, by ‘special leave’. The Apex Court upheld the view of the District Judge, observing as under:

• “We have noticed that the trust deed was executed in favour of the respondents. But it appears in view of the facts and circumstances of this case and the submissions made on behalf of the respondents, that it was waqfed/gifted for a lawful purpose i.e. a “trust” (which) is an obligation annexed to the ownership of the property, and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the benefit of another, or of another owner, (Act II of 1882 Trusts, Section 3). Accordingly, in our opinion, the application filed by the appellants was falling within the required ambit of Section 92 of CPC and the learned district judge had rightly permitted the appellants to institute a suit.”

In Sukumaran v. Akamala Sree Dharma Sastha (supra), the Kerala High Court relied on the following passage from Keshava Panicker v. Damodara Panicker (1975 KLT 797 (F.B.) = AIR 1976 Ker.86).

• “The effect of the Societies Registration Act is not to invest properties of the society with the character of trust property. Even if the purpose for which the society was formed was charitable purpose the property acquired for this purpose will belong to the society and there is no trust and no trust can be predicated……. if there was a trust created by the public, for a public charitable purpose namely establishing, maintaining and running a school the fact of the registration of a society could not change the character of the properties which had already been constituted as trust properties and impressed with the trust and any addition to those properties must also have the same character”.

The Delhi High Court, in Young Mens Christian Association of Ernakulam v. National Council YMCAs of India (2018 SCC OnLine Del 9909), considered whether the term “express or constructive trust” in Section 92 CPC was attracted when a society (National Council YMCAs of India) held ‘in trust’ property belonging to different organisations, and observed as under:

• “In this backdrop, a perusal of Section 92 of the CPC reveals that the term “express or constructive trust” does not relate to a trust constituted under the Indian Trusts Act, but anybody or entity which holds in trust any property and is created for public purposes of a charitable or religious nature. A society can also satisfy the test of express or constructive trust created for public purposes.”

The Delhi High Court also relied on Kesava Panicker v. Damodara Panicker (1975 KLT 797 (F.B.) = AIR 1976 Ker.86), where it was held that if a trust was created for a public or charitable purpose, the fact that it was registered as a society would not change the character of the properties.

The Delhi High Court distinguished

•  Abhaya A Society v. JA Raheem (2005 (3) KLT 891 = AIR 2005 Ker. 233),

•  S. Guhans v. Rukmini Devi Arundale, (1987 100 LW 182, = AIR 1988 Mad.1)

•K. Rajamanickam v. Periyar Self Respect Propaganda Institution (AIR 2007 Mad. 25),
and

•Advocate General v. Bhartiya Adam Jati Sewak Sangh (2001-3 ShimLC 319),

pointing out that these cases did not show that they held ‘in trust’ any property belonging to a different organisation.

Conclusion

For a suit to be maintainable under Section 92 of the Civil Procedure Code, the fundamental requirement is the existence of a valid trust created for public purposes of a charitable or religious nature. The application of Section 92 to the property of a society is subject to strict judicial scrutiny.

•Courts are consistently cautious in extending the ambit of this provision to Societies, unless there is clear, unequivocal evidence that the property is held under an enforceable trust obligation for charitable or religious purposes.

Importantly, the property in question must not merely be "property belonging to a society",because such property is governed by the Societies Registration Act, which prescribes its own statutory framework for ownership, management, and dissolution.