Monday brought a useful mix of rulings for taxpayers, borrowers, accident victims and property occupants. The Supreme Court clarified how goods must be classified for tax and quashed a long-running criminal case arising from a failed relationship, while the Allahabad High Court delivered three judgments on possession, motor accident compensation and arrest safeguards. We also look at a split among High Courts on Debts Recovery Tribunal deadlines, a consumer win over restaurant service charges and three new Supreme Court appointments.
Supreme Court: Tax Classification Depends on What Is Sold, Not How It Is Used
On 5 October 2026, a bench of Justice Manmohan and Justice Arun Palli decided Additional Commissioner Commercial Tax v. Cadila Health Care Ltd, a dispute under the Madhya Pradesh Commercial Tax Act, 1994. The tax department had treated the company’s powder and biscuit products as non-alcoholic beverages, which attracted a higher rate, because consumers mix them with milk or water before consuming them.
What the court held: Classification must be based on the physical form of the goods at the point of sale. A powder or a biscuit does not become a beverage merely because a buyer may later dissolve it in a liquid. In the Court’s words, authorities must look at “what is supplied and not at what is the ‘end use'”. The High Court’s view in favour of the company was upheld.
What it means for you: Manufacturers and traders facing reclassification notices based on how customers use a product now have a clear Supreme Court statement that the taxable event is the supply itself. Although decided under a pre-GST state law, the principle is likely to be cited in GST classification disputes too. Businesses should keep product specifications, labels and invoices that clearly describe the form in which goods are sold.
For related help, see our Taxation Law practice page.
Supreme Court Quashes Criminal Case After Three-Year Consensual Relationship
In a recent judgment in Martanda Singh v. State of Chhattisgarh, a bench of Justice JB Pardiwala and Justice K Vinod Chandran examined an FIR filed in 2025 alleging sexual exploitation on a false promise of marriage. The two had met at an academy and were in a consensual relationship for about three years, with marriage discussions between the families that eventually fell through.
What the court held: The Court quashed the proceedings, finding nothing to show that consent had been obtained by coercion or misrepresentation. A relationship that simply does not end in marriage is not, by itself, criminal deception. The bench looked at consent under Section 90 of the IPC, which corresponds to Section 28 of the Bharatiya Nyaya Sanhita, 2023.
What it means for you: The ruling continues the Supreme Court’s consistent line that criminal law should not be used to address a broken relationship between adults where consent was real. Genuine cases of deceit, where a promise was false from the very start, remain punishable, so each complaint still turns on its facts. Anyone facing or considering such a case should gather the full timeline, including communications and family discussions.
For related help, see our Criminal Defense & Criminal Law practice page.
Allahabad High Court: Cancelling a Sale Deed Does Not Allow Throwing Out the Occupant
Justice Prashant Kumar of the Allahabad High Court decided Rekha Saxena v. Roman Catholic Diocese, Allahabad. A sale deed executed under a power of attorney that had already been cancelled was itself set aside by a court decree in 2001, but that decree did not order eviction. The occupants had built a house and stayed in possession since 1987, and more than three decades later the other side tried to remove them.
What the court held: A decree that only cancels a sale deed, without directing eviction, does not authorise dispossession. A person in long and settled possession has a prima facie case for a temporary injunction, and the court stressed that the owner “cannot take the law into his own hands”. Eviction must come through proper legal proceedings.
What it means for you: Winning a cancellation decree is not the same as winning possession. Owners must seek a specific decree for possession or eviction, while long-term occupants can rely on the courts to stop forcible removal. NRIs whose property in Uttar Pradesh is occupied by others should note that self-help eviction is not permitted and that the right relief must be claimed in the suit.
For related help, see our Property, Real Estate & Waqf Law practice page.
Allahabad High Court Raises Accident Compensation Even Without Family’s Appeal
On 5 October 2026, Justice Prashant Kumar decided National Insurance Co. Ltd. v. Reeta, an appeal by an insurer against a Motor Accident Claims Tribunal award at Faizabad. A man had been fatally hit by a vehicle in Ambedkar Nagar in 2017. The Tribunal awarded about Rs 7.2 lakh, assessing his income at Rs 5,000 a month. The insurer appealed, and the family did not file a cross-appeal.
What the court held: Because the Motor Vehicles Act requires “just compensation”, the appellate court can increase the award even if the claimants have not appealed, once the insurer has put the amount in issue. Relying on Order XLI Rule 33 of the Civil Procedure Code, the court raised the award to about Rs 11.43 lakh with 7% interest.
What it means for you: Families of accident victims who could not afford to file their own appeal are not shut out from a fair amount when the insurer appeals. Insurers, for their part, should expect that challenging the quantum can lead to an increase rather than a reduction.
For related help, see our High Court & Appellate Litigation practice page.
Allahabad High Court: Arrest in a Second Case Is a Fresh Arrest
Justice Manish Mathur decided Moti Ram Jaat v. State of U.P., where a person already in jail in one case was brought on a production warrant and formally arrested in another case under the Bharatiya Nyaya Sanhita. He argued that the grounds of arrest were never given to him. The State said it was only a change of custody.
What the court held: A formal arrest of a person already in custody in another case is a fresh arrest, so the grounds must be communicated under Article 22(1) of the Constitution and Section 48(2) of the BNSS. However, the petition was dismissed because it was filed after the chargesheet and the start of trial, a stage at which such an objection can no longer be raised.
What it means for you: Police must give written grounds of arrest every time a new case is added, even for someone already in jail. Equally important, the challenge must be raised promptly at the remand stage; waiting until trial can mean losing the point altogether.
For related help, see our Criminal Defense & Criminal Law practice page.
High Courts Split on Late Written Statements Before Debts Recovery Tribunals
The Recovery of Debts and Bankruptcy Act requires a borrower to file a written statement before the Debts Recovery Tribunal within a set period, with an outer limit of 45 days under Section 19(5)(i). The Delhi High Court, in a bench of Justice Subramonium Prasad and Justice Renu Bhatnagar, has reaffirmed that this limit cannot be extended by any court. The Punjab and Haryana High Court took the opposite view in March 2026, treating the timeline as directory, and the Telangana High Court, most recently in September 2026, has recognised the tribunal’s discretion to allow late filing case by case.
What changed: The Delhi ruling sharpens a clear conflict of judicial opinion across states on the same central statute, which only the Supreme Court can finally settle.
What it means for you: Borrowers and guarantors served with a DRT notice should treat 45 days as a hard deadline, since in some jurisdictions a late defence may never be heard. Banks and lenders should also watch for the issue reaching the Supreme Court.
For related help, see our Banking, Finance & Recovery practice page.
Consumer Commission Penalises Pub for Forcing Service Charge
On 25 September 2026, the Bengaluru Urban District Consumer Disputes Redressal Commission ruled against a pub that added a 7.5% service charge of Rs 128 to a customer’s bill and refused service unless he paid, despite his objection based on Central Consumer Protection Authority guidelines.
What the court held: The Commission found deficiency in service, noting that the charge was collected as a deliberate management policy and not a billing error. It ordered a refund with interest, Rs 2,000 as compensation and Rs 1,000 as litigation costs.
What it means for you: Service charge in restaurants is voluntary under the CCPA guidelines, and consumer forums are enforcing this even for small amounts. Customers can ask for it to be removed and, if refused, send a notice and approach the consumer commission. Restaurants should review their billing practices.
For related help, see our Consumer Protection practice page.
Centre Notifies Three New Supreme Court Judges
On Monday, 5 October 2026, the Central Government notified the appointment of three High Court Chief Justices as Supreme Court judges: Justice Sunita Agarwal (Gujarat High Court), Justice DK Upadhyaya (Delhi High Court) and Justice Aparesh Kumar Singh (Telangana High Court). The Collegium had recommended them on 28 September 2026.
What changed: The Supreme Court’s working strength rises to 37 against a sanctioned strength of 38, and acting Chief Justices have been named for the Delhi and Telangana High Courts.
What it means for you: A near-full Supreme Court can list and decide more matters, which may help reduce pending appeals over time.
For related help, see our High Court & Appellate Litigation practice page.
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This briefing is a news summary for general awareness and is not legal advice.