Introduction

In an extraordinary demonstration of judicial accountability, Chief Justice B.R. Gavai recently acknowledged that the Supreme Court’s invocation of Article 142 in a corporate insolvency case “resulted in injustice” rather than delivering complete justice.[1]This admission, coupled with the Court’s decision to recall its own judgment in the Bhushan Power and Steel Limited (BPSL) case, has reignited the debate over the proper scope and application of Article 142 of the Constitution.

The Constitutional Provision at the Center of Controversy

Article 142 empowers the Supreme Court to “pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it”.[2] Originally conceived as an extraordinary remedy to fill gaps where laws are silent or justice would otherwise be denied, this provision has increasingly become a subject of intense constitutional debate.[3]

The Growing Criticism

The provision gained unprecedented attention when Vice President Jagdeep Dhankhar characterized Article 142 as a “nuclear missile against democratic forces available to the judiciary 24×7”.[4] This criticism emerged particularly after the Supreme Court’s April 8, 2025 judgment in the Tamil Nadu Governor case, where Justices J.B. Pardiwala and R. Mahadevan invoked Article 142 to grant “deemed assent” to bills that had been indefinitely delayed by the Governor.[5]

The BPSL Case: From Resolution to Liquidation to Recall

The Original Crisis

The Bhushan Power and Steel Limited case exemplifies the complexities surrounding Article 142’s application. In May 2025, a bench comprising Justice Bela M. Trivedi (now retired) and Justice Satish Chandra Sharma rejected JSW Steel’s ₹19,700 crore resolution plan for BPSL and ordered the company’s liquidation.[6] The Court found multiple procedural violations, including:

• JSW Steel’s failure to comply with statutory timelines for over two years
• Inappropriate funding structure combining equity and optionally convertible debentures
• The Resolution Professional’s failure to discharge duties under the Insolvency and Bankruptcy Code[7]
• The Committee of Creditors’ alleged failure to exercise proper commercial wisdom[8]

The Human Cost

The liquidation order threatened the livelihoods of approximately 25,000 workers and put at risk JSW Steel’s investment of nearly ₹20,000 crore in reviving the company. This stark human dimension became central to CJI Gavai’s subsequent analysis of the case.[6]

The Unprecedented Recall

On July 31, 2025, in a rare exercise of judicial introspection, CJI B.R. Gavai and Justice Satish Chandra Sharma recalled the May 2 judgment. The Chief Justice’s observations were particularly striking:[6]

“Prima facie, we are of the view that the impugned judgment does not correctly consider the legal position as has been laid down by a catena of judgments… 25,000 people cannot be thrown onto the road. Article 142 has to be utilised to do complete justice, not to do injustice to 25,000 workers”.

Legal Precedents and Commercial Wisdom

The Doctrine of Commercial Wisdom

The BPSL case highlights the tension between judicial review and the well-established doctrine of commercial wisdom under the Insolvency and Bankruptcy Code. The Supreme Court has consistently held in cases like K. Sashidhar v. Indian Overseas Bank (2019) that courts cannot interfere with the commercial decisions of the Committee of Creditors once a resolution plan is approved by the requisite majority.[9]

The limited judicial review under Section 30(2) of the IBC is restricted to ensuring that resolution plans do not contravene statutory provisions and conform to regulatory requirements.[10] As the Court noted in multiple precedents, “the adjudicating authority cannot interfere on merits with the commercial decision taken by the Committee of Creditors”.

Procedural vs. Substantive Review

The BPSL judgment’s recall raises fundamental questions about the boundaries of judicial intervention. While the original May 2025 judgment criticized procedural lapses, the recall suggests that such technical violations may not justify setting aside an otherwise successful resolution plan that has created substantial value and employment.[11]

The Presidential Reference and Constitutional Questions

The Tamil Nadu Governor case has prompted President Droupadi Murmu to invoke Article 143 of the Constitution, seeking the Supreme Court’s advisory opinion on 14 crucial questions.[12] The Presidential Reference, scheduled for hearing from August 19, 2025, will examine whether:

• Courts can impose timelines on constitutional authorities like the President and Governors
• Article 142 can substitute constitutional powers of executive authorities[13]
• The concept of “deemed assent” violates the doctrine of separation of powes[14]

Implications for Legal Practice

Constitutional Law

The BPSL case demonstrates both the power and the perils of Article 142. While the provision serves as a crucial tool for ensuring justice where traditional remedies fall short, its application requires careful consideration of constitutional boundaries and practical consequences. The Court’s self-correction mechanism, though rare, shows the judiciary’s capacity for introspection and course correction.

Corporate Law and Insolvency Practice

For practitioners in corporate law and insolvency, the BPSL case offers several important lessons:

1. Timeline Compliance: While the IBC emphasizes time-bound resolution, courts may consider the practical realities of complex corporate restructuring[6]
2. Commercial Wisdom Doctrine: The recall reinforces that judicial interference with creditor decisions should be minimal, particularly when resolution plans have been successfully implemented[7]
3. Finality vs. Accountability: The case raises questions about the finality of insolvency proceedings and the circumstances under which implemented resolution plans can be challenged[15]

Procedural Safeguards

The judgment recall also highlights the importance of comprehensive judicial review at all levels. The case suggests that when fundamental procedural requirements are met and commercial wisdom has been exercised, courts should be cautious about invoking extraordinary powers like Article 142 to overturn business decisions.[11]

Looking Forward: Balancing Justice and Institutional Integrity

The BPSL case represents a watershed moment in Indian constitutional jurisprudence. CJI Gavai’s acknowledgment that Article 142 was misused to cause injustice rather than deliver complete justice sets an important precedent for judicial accountability. This self-correction mechanism, while creating short-term uncertainty, ultimately strengthens institutional integrity and public confidence in the judiciary.

The upcoming Presidential Reference hearings will likely provide much-needed clarity on the scope and limitations of Article 142. As legal practitioners, understanding these evolving boundaries will be crucial for advising clients on matters involving extraordinary judicial remedies.

The case also underscores the human dimension of legal decisions. With 25,000 jobs and thousands of crores in investments at stake, the Court’s eventual recognition that “ground realities” must inform judicial decision-making reflects a mature understanding of law’s practical impact on society.

As the legal community awaits the August 7, 2025 fresh hearing of the BPSL case and the broader constitutional questions to be addressed in the Presidential Reference, one thing remains clear: the balance between judicial activism and restraint continues to evolve, shaped by the practical consequences of constitutional interpretation in India’s complex legal landscape.

References

[1] CJI Gavai Recalls May 2 Verdict That Ordered Liquidation of Bhushan Power & Steel Available at: https://lawchakra.in/supreme-court/verdict-liquidation-bhushan-power-steel/

[2] Article 142 of the Constitution of India Available at: https://www.drishtijudiciary.com/to-the-point/ttp-constitution-of-india/article-142-of-the-constitution-of-india

[3] Article 142: The Supreme Power or Judicial Overreach? Available at: https://ddnews.gov.in/en/article-142-the-supreme-power-or-judicial-overreach/

[4] Has the Supreme Court been trigger-happy with Article 142? 

Available at: https://www.scobserver.in/journal/has-the-supreme-court-been-trigger-happy-with-article-142/

[5] Pendency of bills before Tamil Nadu Governor | Judgement Summary Available at: https://www.scobserver.in/reports/pendency-of-bills-before-tamil-nadu-governor-judgement-summary/

[6] SC withdraws Bhushan Power liquidation order, review hearing on Aug 7 Available at: https://www.business-standard.com/industry/news/sc-recalls-judgement-jsw-resolution-plan-bhushan-power-liquidation-125073101593_1.html

[7]   ‘Bhushan Steel’ Judgement: Commercial wisdom sidelined in favour of narrow procedural view Available at: https://www.scobserver.in/journal/bhushan-steel-judgement-commercial-wisdom-sidelined-in-favour-of-narrow-procedural-view/

[8] Commercial Wisdom vs Judicial Review: The Supreme Court’s BPSL Verdict and the Future of IBC Available at: https://nliulawreview.nliu.ac.in/blog/commercial-wisdom-vs-judicial-review-the-supreme-courts-bpsl-verdict-and-the-future-of-ibc/

[9] IN THE NATIONAL COMPANY LAW TRIBUNAL DIVISION BENCH – II, CHENNAI Available at: https://nclt.gov.in/gen_pdf.php?filepath=%2FEfile_Document%2Fncltdoc%2Fcasedoc%2F3305118003002019%2F04%2FOrder-Challenge%2F04_order-Challange_004_1712057631850786731660bed1f10fad.pdf

[10]’ JUDICIAL REVIEW ON COMMERCIAL WISDOM OF COMMITTEE OF CREDITORS IN RESPECT OF APPROVED RESOLUTION PLAN Available at: https://www.taxtmi.com/article/detailed?id=14757

[11] SC Recalls Bhushan Power Liquidation Judgment, Admits JSW’s Review Petition Available at: https://www.outlookbusiness.com/corporate/sc-recalls-bhushan-power-liquidation-judgment-admits-jsws-petition

[12] Presidential Reference: Can the Supreme Court Clarify Past Rulings? Available at: https://vajiramandravi.com/current-affairs/presidential-reference-can-the-supreme-court-clarify-past-rulings

[13] Presidential Reference concerns all States, will answer all questions raised: Supreme Court avaialble at: https://www.cdjlawjournal.com/long.php?id=5018

[14] SC fixes Presidential Reference hearing from August 19, to first hear Tamil Nadu and Kerala on maintainability Available at: https://theleaflet.in/leaflet-reports/sc-fixes-presidential-reference-hearing-from-august-19-to-first-hear-tamil-nadu-and-kerala-on-maintainability

[15] Rejection of Resolution Plan: Review of Judgment? Available at : https://indiacorplaw.in/2025/06/19/rejection-of-resolution-plan-review-of-judgment/

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Introduction 

In a significant and unprecedented decision, the Supreme Court of India has nullified the Chandigarh mayoral election, overturning the victory of Bharatiya Janata Party (BJP) candidate Manoj Sonkar as the mayor of the Chandigarh Municipal Corporation. The three-judge Bench, led by Chief Justice of India Dr D.Y. Chandrachud, took a strong stance against the unlawful actions of the returning and presiding officer, Anil Masih, who was found to have tampered with ballot papers during the counting process.

Invalidation of Ballots and Election Quashed 

The Supreme Court held that Anil Masih had unlawfully altered the course of the mayoral elections by invalidating eight ballot papers cast in favor of the Aam Aadmi Party (AAP) candidate, Kuldeep Kumar. While refraining from quashing the entire election process, the Bench invoked its inherent power under Article 142 of the Constitution to treat the eight wrongly invalidated ballots as valid. As a result, AAP’s Kuldeep Kumar was declared the duly elected mayor of the municipal corporation with 20 votes, surpassing the BJP candidate’s 16 votes.

Show Cause Notice and Criminal Prosecution for Anil Masih

The Bench issued a show cause notice to Anil Masih, asking him to explain why he should not be prosecuted for perjury. Masih had initially admitted to putting marks on eight ballot papers but claimed it was due to defacement. However, upon physical verification, the court found no evidence of defacement, leading to doubts about Masih’s credibility. The court ordered criminal prosecution against Masih under section 340 of the Code of Criminal Procedure for allegedly making false statements.

Background of the Chandigarh Mayoral Election Case

The controversy began earlier this month when the Supreme Court criticized Anil Masih for defacing ballot papers in favor of the BJP candidate, calling it a “mockery of democracy.” The court ordered the sequestration of the entire record of the Chandigarh mayor elections and deferred a scheduled municipal corporation meeting. AAP candidate Kuldeep Kumar had filed a petition against the Punjab and Haryana High Court’s refusal to grant interim relief in the case.

Allegations of Ballot Tampering and Video Evidence

Kumar alleged that Masih tampered with ballot papers during the counting process, as seen in a widely reported video. The video showed Masih marking ballot papers with a pen, leading to the invalidation of eight votes for Kumar. Despite raising concerns in the Punjab and Haryana High Court, Kumar received no interim relief, prompting him to approach the Supreme Court.

Supreme Court’s Strong Criticism and Verdict

The Supreme Court strongly criticized Masih’s actions, declaring them a “serious misdemeanour.” The court emphasized that Masih had unlawfully altered the mayoral election and expressed falsehood in his statement before the court. The verdict not only invalidated the election results but also exposed Masih’s deliberate efforts to favor the BJP candidate.

Chandigarh Mayoral Election: Safeguarding Democracy – Conclusion

The Supreme Court’s decision to nullify the Chandigarh mayoral election underscores the importance of upholding democratic principles and fair electoral processes. The court’s strong stance against ballot tampering and its commitment to preserving the integrity of elections send a clear message about the consequences of electoral misconduct. The case serves as a reminder that any attempts to undermine the democratic process will face severe legal scrutiny and consequences.

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