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Adverse Inference Can’t Override Right to Cross-Examination in Commercial Suits: Karnataka High Court

The Karnataka High Court has held that adverse inference for non-production of documents cannot justify the denial of the fundamental right to cross-examination during trial.

The bench of Justice M. Nagaprasanna affirmed that adverse inference—though statutorily permissible for non-production of documents—can only be drawn at the conclusion of trial, not midway through the proceedings.

“Right to cross-examination is not a mere procedural privilege but the bedrock of a fair hearing… Statute or no statute, it stems from the principles of natural justice,” the bench observed.

The case arose from a commercial dispute involving Sivagami N., widow of a deceased partner in the firm Vinayaka Travels, who had filed a counter-claim seeking settlement of her late husband’s dues amounting to Rs. 5 crore. During the proceedings, the plaintiffs failed to comply with court directions to produce crucial financial documents, including firm accounts and balance sheets.

The petitioner sought an adverse inference against the plaintiffs under Order XI Rule 5(4) of the Civil Procedure Code (CPC) and further requested the court to deny the plaintiffs the right to cross-examine her on the grounds of that inference.

The judgment relied heavily on landmark decisions including Ayaaubkhan Noorkhan Pathan v. State of Maharashtra, where the Supreme Court held cross-examination to be an “indefeasible right”, and Noor Mohammed v. Khurram Pasha, which emphasized that even statutory non-compliance could not result in denial of cross-examination.

The Court highlighted that while procedural provisions like Order XI Rule 5 allow for drawing of adverse inference due to non-production of documents, such inferences must follow a full evaluation of evidence—not precede it. The denial of cross-examination on this basis, it noted, would “imperil justice itself.”

“The presumption of adverse inference, like all other presumptions, must avail the moment of judgment and not pre-empt the examination,” the court remarked.

THigh Court found the Commercial Court’s earlier decision rejecting the application to deny cross-examination as legally sound and dismissed the writ petition.

Case Detail

Case Title: Sivagami N. Versus M/S. Vinayaka Travels

Case No.: Writ Petition No.17796 Of 2025 (Gm – Cpc)

Date:  30/07/2025

Counsel For  Petitioner: K.B.S.Manian, Advocate

Counsel For Respondent: Dhananjay V.Joshi, Sr.Advocate 

Read More: Bombay High Court Quashes ITAT Order in Skyway Case Over Missing DIN; Directs Fresh Hearing

Amit Sharma
Amit Sharma
Amit Sharma is the Content Editor at JurisHour. He has been writing about the Indian legal market. He has covered tax & company litigation stories from the Supreme Court, High Courts and Various Tribunals. Amit graduated from MLSU Law College with B.A.LL.B. and also holds an LL.M. from MLSU, Udaipur, Rajasthan. An Advocate in Taxation, and practised in Tribunals as well as Rajasthan High Court and pursued Masters in Constitutional Law. He started out small with little resources but a big plan to take tax legal education to the remotest locations across India and eventually to the world. His vision is to make tax related legal developments accessible to the masses.
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