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IAI Actuarial Core Principles · Business Management · Sources of Indian law and valid contracts

A Delhi High Court division bench decides a point of contract law. Later, a single judge of the Madras High Court and a trial court in Pune each face the same point in unrelated cases. Applying the doctrine of precedent in India, which statement is correct?

A High Court decision binds courts subordinate to it within its own state or territory, but is only persuasive elsewhere. So the Delhi ruling is persuasive for the Madras High Court and the Pune court. Only Supreme Court judgments bind all courts across India.

  1. ABoth the Madras single judge and the Pune court are strictly bound by the Delhi decision
  2. BNeither court has any regard at all for the Delhi decision
  3. CThe Delhi decision is binding on the Madras High Court but only persuasive for Pune
  4. DThe Delhi decision is binding on courts in Delhi's territorial jurisdiction below it but only persuasive for the Madras High Court and the Pune courtCorrect
  5. The Delhi decision is binding on every court in India including the Supreme Court

Explanation

A High Court judgment binds courts subordinate to it within its territory. Other High Courts and courts outside its jurisdiction treat it as persuasive only. Only Supreme Court decisions bind all courts in India under Article 141, and the Supreme Court is not bound by a High Court.

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