The concept of binding precedent is a cornerstone of the common law judicial system, ensuring consistency, predictability, and stability in the application of the law. This principle mandates that decisions made by higher courts or Benches of equal strength must be followed by subsequent courts in similar cases. It upholds judicial discipline and decorum, promoting confidence in the legal system.

The Supreme Court of India has elaborated on this doctrine through various judgments, emphasizing its importance in maintaining judicial order and preventing chaos in legal interpretations

In State of Bihar v. Kalika Kuer alias Kalika Singh and others, (2003) 5 SCC 448, it has been held: –

“10. … an earlier decision may seem to be incorrect to a Bench of a coordinate jurisdiction considering the question later, on the ground that a possible aspect of the matter was not considered or not raised before the court or more aspects should have been gone into by the court deciding the matter earlier but it would not be a reason to say that the decision was rendered per incuriam and liable to be ignored. The earlier judgment may seem to be not correct yet it will have the binding effect on the later Bench of coordinate jurisdiction. …”

The Court has further ruled: – “10. … Easy course of saying that earlier decision was rendered per incuriam is not permissible and the matter will have to be resolved only in two ways – either to follow the earlier decision or refer the matter to a larger Bench to examine the issue, in case it is felt that earlier decision is not correct on merits.”

In G.L. Batra v. State of Haryana and others, 2013(4) S.C.T. 776, the Court has accepted the said principle on the basis of judgments of Supreme Court rendered in Union of India v. Godfrey Philips India Ltd., (1985) 4 SCC 369, Sundarjas Kanyalal Bhatija v. Collector, Thane, Maharashtra, 1989(2) R.R.R. 111 and Tribhovandas Purshottamdas Thakkar v. Ratilal Motilal Patel, AIR 1968 Supreme Court 372.

It may be noted here that the Constitution Bench in Madras Bar Association v. Union of India and another, (2015) 8 SCC 583 has clearly stated that the prior Constitution Bench judgment in Union of India v. Madras Bar Association, (2010) 11 SCC 1 is a binding precedent.

In this regard, we may refer to a passage from Jaisri Sahu v. Rajdewan Dubey, AIR 1962 Supreme Court 83:-

“11. Law will be bereft of all its utility if it should be thrown into a state of uncertainty by reason of conflicting decisions, and it is therefore desirable that in case of difference of opinion, the question should be authoritatively settled. It sometimes happens that an earlier decision given by a Bench is not brought to the notice of a Bench hearing the same question, and a contrary decision is given without reference to the earlier decision. The question has also been discussed as to the correct procedure to be followed when two such conflicting decisions are placed before a later Bench.

The practice in the Patna High Court appears to be that in those cases, the earlier decision is followed and not the later. In England the practice is, as noticed in the judgment in Seshamma v. Venkata Narasimharao that the decision of a court of appeal is considered as a general rule to be binding on it. There are exceptions to it, and one of them is thus stated in Halsbury’s Laws of England, 3rd Edn., Vol. 22, para 1687, pp. 799-800:

“The court is not bound to follow a decision of its own if given per incuriam. A decision is given per incuriam when the court has acted in ignorance of a previous decision of its own or of a Court of a co-ordinate jurisdiction which covered the case before it, or when it has acted in ignorance of a decision of the House of Lords. In the former case it must decide which decision to follow, and in the latter it is bound by the decision of the House of Lords.”

In Virayya v. Venkata Subbayya it has been held by the Andhra High Court that under the circumstances aforesaid the Bench is free to adopt that view which is in accordance with justice and legal principles after taking into consideration the views expressed in the two conflicting Benches, vide also the decision of the Nagpur High Court in Bilimoria v. Central Bank of India.

The better course would be for the Bench hearing the case to refer the matter to a Full Bench in view of the conflicting authorities without taking upon itself to decide whether it should follow the one Bench decision or the other. We have no doubt that when such situations arise, the Bench hearing cases would refer the matter for the decision of a Full Court.”

Judicial Decorum and Discipline

The Supreme Court in National Insurance Company Ltd v. Pranay Sethi (2018) while agreeing the above mentioned view of the court, said that, it is the precise warrant of respecting a precedent which is the fundamental norm of judicial discipline.

In Pradip Chandra Parija and others v. Pramod Chandra Patnaik and others, 2002(1) RCR (Civil) 551, the Constitution Bench was dealing with a situation where the two-Judge Bench disagreeing with the three-Judge Bench decision directed the matter to be placed before a larger Bench of five Judges of Supreme Court. In that scenario, the Constitution Bench stated: –

“6. … In our view, judicial discipline and propriety demands that a Bench of two learned Judges should follow a decision of a Bench of three learned Judges. But if a Bench of two learned Judges concludes that an earlier judgment of three learned Judges is so very incorrect that in no circumstances, can it be followed, the proper course for it to adopt is to refer the matter before it to a Bench of three learned Judges setting out, as has been done here, the reasons why it could not agree with the earlier judgment. …”

In Chandra Prakash and others v. State of U.P. and another, 2002(2) S.C.T. 776 another Constitution Bench dealing with the concept of precedents stated thus:-

“22. … The doctrine of binding precedent is of utmost importance in the administration of our judicial system. It promotes certainty and consistency in judicial decisions. Judicial consistency promotes confidence in the system, therefore, there is this need for consistency in the enunciation of legal principles in the decisions of this Court. It is in the above context, this Court in the case of Raghubir Singh, 1989(1) R.R.R. 552 : (1989) 2 SCC 754 held that a pronouncement of law by a Division Bench of this Court is binding on a Division Bench of the same or smaller number of Judges. …”

In Sandhya Educational Society and another v. Union of India and others, (2014) 7 SCC 701, it has been observed that judicial decorum and discipline is paramount and, therefore, a coordinate Bench has to respect the judgments and orders passed by another coordinate Bench.

In Rattiram and others v. State of Madhya Pradesh, 2012(2) RCR (Criminal) 471, the Court dwelt upon the issue what would be the consequent effect of the latter decision which had been rendered without noticing the earlier decisions. The Court noted the observations in Raghubir Singh (supra) and reproduced a passage from Indian Oil Corporation Ltd. v. Municipal Corporation, (1995) 4 SCC 96 which is to the following effect: –

“8. … The Division Bench of the High Court in Municipal Corpn., Indore v. Ratnaprabha Dhanda was clearly in error in taking the view that the decision of this Court in Ratnaprabha was not binding on it. In doing so, the Division Bench of the High Court did something which even a later coequal Bench of this Court did not and could not do. …”

It also stated what has been expressed in Raghubir Singh (supra) by R.S. Pathak, C.J. It is as follows:- “28. We are of opinion that a pronouncement of law by a Division Bench of this Court is binding on a Division Bench of the same or a smaller number of Judges, and in order that such decision be binding, it is not necessary that it should be a decision rendered by the Full Court or a Constitution Bench of the Court. …”