List of Current Affairs

Source: Supreme Court 

Why in News? 

The bench of Justices Sanjay Kumar and Alok Aradhe in the case of M/s. Saraswati Wire and Cable Industries v. Mohammad Moinuddin Khan and Others (2025) set aside the NCLAT's judgment and restored the NCLT's order admitting the corporate insolvency resolution process, holding that the corporate debtor's defence of pre-existing disputes was mere moonshine without credible foundation. 

What was the Background of M/s. Saraswati Wire and Cable Industries v. Mohammad Moinuddin Khan and Others (2025) Case? 

• M/s. Saraswati Wire and Cable Industries (the firm) supplied pipes and cables to Dhanlaxmi Electricals Private Limited (the corporate debtor/CD). 
• On August 4, 2021, the CD sent its ledger account showing ₹1,79,93,690.80 due to the firm, raising only three minor discrepancies from November 2018 transactions. 
• On August 25, 2021, the firm issued a demand notice under Section 8 of the IBC claiming ₹1,79,93,691/- plus interest. 
• A separate CIRP had already been initiated against the CD on September 6, 2021, by another operational creditor. 
• On November 20, 2021, the CD's suspended Technical Director replied claiming non-supply, sub-standard material, and counterclaims of ₹1,17,96,800/-. 
• Despite these claims, the CD paid ₹61 lakh to the firm after the demand notice was issued. 
• After withdrawal application in the earlier CIRP, the firm filed its Section 9 application on February 10, 2023. 
• On December 6, 2023, the NCLT admitted the firm's application based on the CD's ledger account and post-demand payments. 
• A suspended director appealed to the NCLAT, which set aside the admission order on March 13, 2024, citing pre-existing dispute. 

What were the Court's Observations? 

• The Court held that the CD's defence of pre-existing disputes was "mere moonshine and had no credible basis or foundation." 
• The Court reiterated principles from Mobilox Innovations (2018) that adjudicating authorities must "separate the grain from the chaff" and reject spurious defences without examining full merits of disputes. 
• Applied the "moonshine defence" principle from pre-IBC cases emphasizing disputes must be bonafide, not mere bluster to delay proceedings. 
• The suspended Technical Director had no authority to reply on the CD's behalf as CIRP had commenced and the Interim Resolution Professional had taken over management. 
• The CD's own ledger account dated August 4, 2021, certified the debt at ₹1,79,93,690.80, providing clear evidence of operational debt. 
• Payment of ₹61 lakh after the demand notice clearly negated any pre-existing dispute. 
• The firm produced delivery challans, e-way bills, and transport bills proving supply of goods under the disputed invoices. 
• The CD provided no documentary evidence supporting claims of sub-standard material, client complaints, or how counter-claims were quantified. 
• The NCLAT was not informed about the separate CIRP that explained the firm's delay in filing its Section 9 application. 
• Set aside the NCLAT judgment and restored the NCLT admission order, directing further proceedings to continue from the date of the judgment. 

What is Corporate Insolvency Resolution Process (CIRP)? 

About: 

• CIRP is a mechanism under the Insolvency and Bankruptcy Code, 2016 (IBC), to resolve corporate insolvency in a time-bound manner. 
• Can be initiated by financial creditors (Section 7), operational creditors (Section 9), or the corporate debtor itself (Section 10). 
• The objective is to balance stakeholder interests while attempting to revive the corporate debtor. 

Section 9 Application by Operational Creditor: 

• An operational creditor is a person to whom an operational debt is owed, including suppliers of goods or services. 
• Before filing Section 9, the operational creditor must serve a demand notice under Section 8 demanding payment. 
• If the corporate debtor fails to pay within 10 days or disputes the debt, the creditor may file before the NCLT. 
• The NCLT must verify: (a) operational debt exceeding threshold limit, (b) debt is due and payable, and (c) no pre-existing dispute exists. 

Pre-existing Dispute Requirements: 

• Must exist before the date of the demand notice under Section 8. 
• Must be genuine, substantial, and not spurious, hypothetical, or illusory. 
• Mere assertions without documentary proof do not constitute valid dispute. 
• The adjudicating authority only determines if a genuine dispute exists, not the merits. 

Effect of CIRP Admission: 

• Moratorium is declared under Section 14, prohibiting suits and recovery proceedings. 
• An Interim Resolution Professional takes over management of the corporate debtor. 
• Board of directors and officers stand suspended and cannot act on behalf of the company. 
• Resolution process must be completed within 180 days (extendable by 90 days), failing which liquidation follows. 

Source: High Court of Himachal Pradesh 

Why in News? 

Justice Ranjan Sharma of the Himachal Pradesh High Court in Baljinder Kaur v. State of Himachal Pradesh and Others (2025) dismissed a writ petition challenging non-selection for a reserved OBC post, holding that reservation benefits accrue only when candidates actively apply for reserved category positions with valid certificates. 

What was the Background of Baljinder Kaur v. State of Himachal Pradesh and Others (2025) Case? 

• The petitioner, Baljinder Kaur, was working as a Punjabi Teacher under PTA in Government Senior Secondary School (GSSS) Majari, District Bilaspur. 
• On 06.08.2010, the Deputy Director of Education, Bilaspur advertised 6 posts of Punjabi Teachers on a period basis, with one post reserved for the OBC category. 
• The petitioner belonged to the OBC category as per a certificate dated 21.08.2004. 
• The petitioner claimed she applied for the OBC reserved post but was not selected. 
• Respondent No.4 (Daljeet Singh), who belonged to the OBC category, was selected and appointed to the reserved post on 24.10.2010. 
• The petitioner initially filed CWP No.7643 of 2010, which was transferred to the State Administrative Tribunal as T.A. No.2636 of 2015. 
• After abolition of the Tribunal, the matter was transferred back to the High Court as CWPOA No.1968 of 2019. 
• The petitioner sought quashing of Daljeet Singh's appointment and claimed appointment for herself against the reserved OBC post. 
• In their reply affidavit dated 24.11.2011, respondents stated that the petitioner had not applied for the reserved OBC post, and no application (Annexure P-10) was received by them. 

What were the Court's Observations? 

On Application for Reserved Category: 

• The Court noted that the Recruitment Notice expressly mandated candidates to annex reserved category certificates with their applications. The petitioner failed to provide evidence of applying as an OBC candidate. 
• "Right of a reserved candidate for consideration against reserved post accrues and crystalizes only in case, a reserved candidate opts and applies for reserved post and not otherwise." 
• The Court held that merely belonging to OBC category does not confer automatic right of appointment against a reserved post. Once the petitioner chose not to apply for OBC reservation, she had no right to claim it after unsuccessful selection in general category. 

On Certificate Validity: 

• The Court examined the petitioner's OBC certificate dated 21.08.2004. Under Clause 28.13 of Himachal Pradesh Land Records Manual, OBC certificates have one-year validity.  
• The certificate expired on 21.08.2005, while the advertisement was issued on 06.08.2010 – five years later. 
• The petitioner failed to establish continued OBC status and non-creamy layer eligibility on the advertisement date, further weakening her claim. 

On Educational Qualifications: 

• The petitioner argued Respondent No.4 was ineligible for lacking M.A. in Punjabi. 
• The Court found that Recruitment Rules prescribed alternative qualifications (Honours Certificate OR B.A. Honours with B.Ed. OR 10+2 with Gyani Certificate OR M.A. in Punjabi). 
• Since Respondent No.4 possessed 10+2 with Gyani Certificate from Punjabi University, Patiala, he was fully eligible. The Court rejected the argument that "/" in the advertisement made M.A. mandatory, holding it must be read conforming to Recruitment Rules. 

Service Rules Prevail Over Advertisements: 

• The Court established that in case of conflict between advertisement and Service Rules, statutory rules prevail. Citing ESIC v. Union of India (2022) and Chandra Shekhar Singh v. State of Jharkhand (2025), the Court held that erroneous advertisements cannot override statutory qualifications or create rights contrary to service rules. 

On General Category Claim and Delay: 

• The petitioner later claimed higher merit against general category candidates. 
• The Court declined to adjudicate this as: (1) general category candidates were not made parties, (2) over 15 years had passed since selection, and (3) impleadment at this stage suffered from delay and laches. 

Final Ruling: 

• The Court dismissed the petition, upholding Respondent No.4's appointment. 
• The petitioner's non-selection was attributed to her own inaction in not applying for the OBC-reserved post with valid certificate at the relevant time. 

What are the Key Provisions Related to Reservations in India? 

About: 

Reservation is a form of positive discrimination aimed at promoting equality for marginalized groups and addressing social and historical injustices. It provides preferential treatment in education and employment to uplift disadvantaged communities. 

Key Provisions:  

• The Constitution of India incorporates various provisions to promote social justice and ensure adequate representation for historically disadvantaged communities. 
• These provisions span across Part III (Fundamental Rights) and Part XVI (Special Provisions Relating to Certain Classes). 
• Articles under Part III on Reservation: 
  • Article 15(3): Empowers the State to make special provisions for women and children. 
  • Article 15(4): Enables the State to make special provisions for the advancement of socially and educationally backward classes, including SCs and STs. 
  • Article 15(5): Allows for reservation in educational institutions (including private, unaided institutions but excluding minority institutions) for socially and educationally backward classes, SCs, and STs. 
  • Article 15(6): Introduced via the 103rd Constitutional Amendment (2019), allows the State to make special provisions, including reservations, for Economically Weaker Sections (EWS) among unreserved categories. 
  • Article 16(4): Permits reservation in appointments/posts for any backward class of citizens not adequately represented in state services. 
  • Article 16(4A): Allows reservation in promotions for SCs and STs (77th Amendment Act, 1995, modified by the 85th Amendment Act, 2001 to include consequential seniority). 
  • Article 16(4B): Allows the State to carry forward unfilled reserved vacancies from previous years without breaching the 50% ceiling (81st Amendment Act, 2000). 
  • Article 16(6): Provides for reservation in public employment for EWS, distinct from the backward class reservations. 
  • Articles under Part XVI on Reservation: 
  • Article 330 & 332: Provide for the reservation of seats for SCs and STs in the Lok Sabha and State Legislative Assemblies, respectively. 
  • Article 233T: Ensures reservation of seats for SCs and STs in every Municipality. 
  • Article 243D: Mandates reservation for SCs and STs in every Panchayat. 
  • Article 335: States that the claims of SCs and STs shall be taken into account in the making of appointments to public services and posts, consistent with the maintenance of administrative efficiency. 

Timeline development of Reservation 

 Judicial view of Reservation: 

• The State of Madras v. Smt.Champakam Dorairajan (1951) case was the first major Case of the Supreme Court on the issue of Reservation. The case led to the First Amendment in the constitution. 
  • The Supreme Court pointed out that while in the case of employment under the State, Article 16(4) provides for reservations in favour of backward class of citizens, no such provision was made in Article 15. 
  • Pursuant to the Supreme Court’s order in the case, Parliament amended Article 15 by inserting Clause (4). 
• In Indra Sawhney v. Union of India (1992) case the court examined the scope and extent of Article 16(4). 
  • The court has said that the creamy layer of OBCs should be excluded from the list of beneficiaries of reservation, there should not be reservation in promotions, and total reserved quota should not exceed 50%. 
• The Parliament responded by enacting the 77th Constitutional Amendment Act. 1995 which introduced Article 16(4A). 
  • The Article confers power on the state to reserve seats in favor of SC and ST communities in promotions in Public Services if the communities are not adequately represented in public employment. 
• The Supreme Court in M. Nagaraj v. Union of India (2006) case while upholding the constitutional validity of Art 16(4A) held that any such reservation policy in order to be constitutionally valid shall satisfy the following three constitutional requirements: 
  • The SC and ST communities should be socially and educationally backward. 
  • The SC and ST communities are not adequately represented in public employment. 
  • Such a reservation policy shall not affect the overall efficiency of the administration. 
• In Jarnail Singh v. Lachhmi Narain Gupta case (2018), the Supreme Court held that reservation in promotions does not require the State to collect quantifiable data on the backwardness of the Scheduled Castes and the Scheduled Tribes. 
  • The Court held that creamy layer exclusion extends to SC/STs and, hence the State cannot grant reservations in the promotion to SC/ST individuals who belong to the creamy layer of their community. 
• In Janhit Abhiyan v. Union of India (2022) the constitutional validity of 103rd Constitutional Amendment Act, 2019 was challenged. The Supreme Court upheld the validity of 103rd Constitutional Amendment. 
  • The Court introduced 10% EWS reservation under the 103rd Constitution (Amendment) Act, 2019 by amending Articles 15 and 16. 
  • It inserted Article 15 (6) and Article 16 (6).