Source: Bombay High Court

Why in News?

The bench of Justice Gautam Patel and Justice Kamal Khata observed that no litigant can disadvantage the opponent by squirrelling some information into the court record ‘in sealed cover’.

• The Bombay High Court gave this observation in the matter of Sonali Ashok Tandle v. Ranka Lifestyle Ventures and Ors.

Background

• Petitioner through a writ petition claimed that she has been allotted an area smaller than she is entitled to in the building redeveloped by the respondent developer.
• The bench of Justice GS Kulkarni and Justice RN Laddha, Bombay HC noted that the respondent failed to appear before the court of law.
  • Hence, the court issued show cause notices to the developer and Maharashtra Housing and Area Development Authority (MHADA) directing them to file affidavit of disclosure with details related to unsold flats, the movable and immovable aspects, bank details and I.T. Returns, in sealed envelope.
• A list of unsold flats and financial statements of the 1st Respondent was handed over in a sealed envelope to the Court.
• The previous Division Bench of Justice GS Kulkarni and Justice RN Laddha accepted the tendering of some documents in sealed cover by the 1st Respondent.

Court’s Observation

• The HC held that no party could rely on such ‘sealed cover material’ to the prejudice of the other side, and no court should permit it.
  • The court further said, “It is time to bury this thoroughly pernicious practice”.
• The bench also opined that furnishing information in sealed covers undermines the legitimacy of the adjudication process in any system based on an adversarial proceeding.

Sealed Cover Procedure

• The "sealed cover procedure" is a legal mechanism often used by courts and government authorities to safeguard sensitive information.
• It is a complex process that involves the submission of confidential documents or information to the court in a sealed envelope, shielded from public view.
• If the court grants permission to use the sealed cover procedure, the party submitting the confidential information must place the documents in a sealed envelope.
  • This envelope is typically marked with the case details, the court's seal, and a statement indicating its confidential nature.
• The procedure has been criticized several times for the lack of transparency and fairness.

Landmark Cases

• Vishal Tiwari v. Union of India (2018):
  • The Chief Justice of India (CJI) D Y Chandrachud rejected the sealed covers in the Adani -Hindenburg issue to ensure transparency.
  • The court held that “In case we take suggestions from sealed cover, it automatically means the other party won't know and people will think it is a government-appointed committee. We want full transparency for the protection of investors. We will form a committee. There will be a sense of confidence in the court”.
• Nivedita Jha v. State of Bihar (2018):
  • Former CJI N V Ramanna rejected to accept the sealed cover by stating that “Action taken report doesn't have to be in sealed cover”.
• Indian Ex Service Movement v. Union of India (2022):
  • CJI D Y Chandrachud has rejected the submission of information in sealed cover stating that the information must be made known to the other side as well.
• Cdr Amit Kumar Sharma v. Union of India (2022):
  • The SC held that the practice of furnishing information in sealed cover would make the “the process of adjudication vague and opaque”.
  • The court further held that “The measure of nondisclosure of sensitive information in exceptional circumstances must be proportionate to the purpose that the non-disclosure seeks to serve”.

Legal Provisions

• Sealed cover jurisprudence is not specifically defined under any law, however Rule 7 of order XIII of the Supreme Court Rules 2013 and Section 123 of the Indian Evidence Act, 1872 (IEA) slightly covers the concept.
  • Rule 7 of order XIII of the Supreme Court Rules 2013:
    • No party or person shall be entitled as of right to receive copies of or extracts from any minutes, letter or document of any confidential nature or any paper sent, filed or produced, which the Chief Justice or the Court directs to keep in sealed cover or considers to be of confidential nature or the publication of which is considered to be not in the interest of the public, except under and in accordance with an order specially made by the Chief Justice or by the Court.
• Section 123 of the Indian Evidence Act, 1872 (IEA): Evidence as to affairs of State -
  • No one shall be permitted to give any evidence derived from unpublished official records relating to any affairs of State, except with the permission of the officer at the head of the department concerned, who shall give or withhold such permission as he thinks fit.