Supreme Court judgments passed in exercise of appellate jurisdiction are binding precedents, no matter if they are brief, held the Apex Court in S.E. Graphites Private Limited vs. State of Telangana.
The court observed that “it is well established that once a special leave petition has been granted, the doors for the exercise of appellate jurisdiction of this Court have been let open. Resultant, the order impugned before the Supreme Court became an order appealed against and any order passed thereafter would be an appellate order and attract the doctrine of merger despite the fact that the order is of reversal or of modification or of affirming the order appealed against and including is a speaking or non-speaking one.”
The two judge bench comprising of Justice AM Khanwilkar and Justice Ajay Rastogi made these observations while dealing with an appeal from the judgment of the High Court in the case relating to the interpretation of provisions of Telangana State VAT Act, 2005. The High Court in this case had dismissed some writ petitions following its own decision in Ankamma Trading Company v Appellate Deputy Commissioner (CT) Guntur & Anr.
The appellant, relying upon the judgment in Kunhayammed Vs. State of Kerala, contended before the Supreme Court that the decision in Ankamma case has been impliedly overruled by the Supreme Court in M/s. Innovatives Systems Vs. State of Andhra Pradesh. In that case, the Supreme Court after clearly noting that the High Court had relied upon the judgment and order passed by the Division Bench of the same High Court in Ankamma Trading Company to dismiss the writ petition preferred by the appellant, proceeded to allow the appeal filed by the appellant, therein setting aside the judgment of the High Court. The Apex court following its own judgment in Kunhayammed case, agreed with the contentions of the appellant.
The Court rejected the contentions of the respondent that the judgment in M/s. Innnovatives Systems neither refers to any specific provision nor has it expressly overturned the decision of the Division Bench of the High Court in Ankamma Trading Company. The court held that the fact that the decision in M/s. Innovatives is a brief judgment has no relevance with regard to it being a binding precedent. Any order passed after the grant of special leave would be an appellate order and would act as a binding precedents.