Precedent and stare decisis in India: Article 141

1. Why precedents bind

Stare decisis et non quieta movere — stand by what has been decided and do not disturb what is settled. The justifications are familiar: like cases should be treated alike (equality); people should be able to plan by the law (certainty); litigants should not reopen settled questions (economy); and judges are restrained by having to follow or openly depart from what others have decided (discipline). The costs are rigidity and the perpetuation of error. Every system of precedent is a compromise between these.

Precedents are binding (a court must follow them even if it disagrees) or persuasive (decisions of foreign courts, of coordinate High Courts, obiter dicta, dissents). Binding force runs vertically (from higher to lower courts) and, in some systems, horizontally (a court bound by its own past decisions).

2. What part of a judgment binds

Only the ratio decidendi — the principle of law on which the decision rests — binds. Observations not necessary for the decision are obiter dicta. Two classic tests for finding the ratio:

• Wambaugh’s inversion test: frame the proposition, reverse it, and ask whether the decision would have been different. If not, the proposition is not the ratio.
• Goodhart’s material facts test (“Determining the Ratio Decidendi of a Case”, 1930): the ratio is found from the facts the judge treated as material and the decision on those facts.

Julius Stone’s objection is that the material facts can be stated at many levels of generality, so a later court has a real choice about how wide the ratio is. This is how distinguishing works, and it is the main qualification on the “directive force” of a precedent.

3. Article 141 and the Indian hierarchy

Article 141: “The law declared by the Supreme Court shall be binding on all courts within the territory of India.” Article 144 requires all authorities, civil and judicial, to act in aid of the Supreme Court. Three propositions follow.

1. “Law declared” means the principle decided, not every word of the judgment. A point not argued and not considered, decided without reasons, is not law declared. In State of U.P. v. Synthetics and Chemicals Ltd., 1991 INSC 159, (1991) 4 SCC 139, the Court applied the ideas of per incuriam and sub silentio to an observation in an earlier decision made without argument.
2. “All courts” does not include the Supreme Court itself. In Bengal Immunity Co. v. State of Bihar, 1955 INSC 36, AIR 1955 SC 661, the Court held that it is not bound by its own previous decisions and overruled State of Bombay v. United Motors (1953), given only two years earlier.
3. Obiter of the Supreme Court is not strictly binding but is treated by High Courts with great respect, and a considered pronouncement is in practice followed.

Below the Supreme Court, a High Court’s decision binds courts and tribunals subordinate to it within the State; it is only persuasive for other High Courts. A single judge is bound by a Division Bench of the same court.

4. Horizontal precedent: bench strength

Because the Supreme Court sits in benches of two, three, five, seven and more, its rules on horizontal precedent are about bench strength. The settled position is in Central Board of Dawoodi Bohra Community v. State of Maharashtra, 2004 INSC 720, (2005) 2 SCC 673:

• A decision of a larger bench binds any later bench of lesser or coequal strength.
• A bench of lesser strength cannot disagree with or dissent from a larger bench. If it doubts the decision, it can only place the matter before the Chief Justice for a larger bench.
• A bench of coequal strength that doubts an earlier decision may refer the question to a larger bench; it cannot overrule.
• The Chief Justice, as master of the roster, may constitute a larger bench in an appropriate case.

The same discipline was stressed in Union of India v. Raghubir Singh, 1989 INSC 192, (1989) 2 SCC 754, and in National Insurance Co. v. Pranay Sethi, 2017 INSC 1068, (2017) 16 SCC 680, which held that a decision of a coordinate bench rendered earlier binds the later one. In Shah Faesal v. Union of India, 2020 INSC 253, (2020) 4 SCC 1, a five-judge bench declined to refer the Article 370 challenge to seven judges, holding that the mere fact that an earlier judgment did not consider an argument does not justify a reference.

5. When will the Court overrule itself?

Keshav Mills Co. v. CIT, 1965 INSC 23, AIR 1965 SC 1636, set the approach: the Court will revisit an earlier decision only if it is satisfied that the decision is plainly erroneous and that its reversal is in the public interest, considering whether the decision has been followed and acted on, the effect of reversal on people who relied on it, and whether the error was a matter of considered judgment. A decision is not to be reopened merely because a different view is possible.

6. Exceptions: per incuriam and distinguishing

• Per incuriam. A decision given in ignorance of a binding statute, rule or precedent does not bind. The Court explained the doctrine in Sundeep Kumar Bafna v. State of Maharashtra, 2014 INSC 218, (2014) 16 SCC 623, and warned that it is to be used sparingly, not as a device to avoid a decision one dislikes.
• Distinguishing on material facts.
• Change in the law — a precedent loses force when the statute it construed is amended or repealed.
• Overruled by a larger bench or by legislation that validly removes its basis.

7. Comparative position

How this is examined

The August 2024 paper (Q.1) quoted the proposition that every precedent has directive force for future cases and asked whether it is true. Agree in part: explain the justification of stare decisis, then qualify it — only the ratio binds; the hierarchy under Article 141; the bench rules from Dawoodi Bohra; overruling (Keshav Mills); per incuriam; and distinguishing. Close with the English Practice Statement and Dobbs to show that every apex court keeps the power to correct itself. The same material answers a short note on precedent as a tool of judicial creativity.