During hearings, the Court questioned why Justice Varma participated in the in-house inquiry if he believed it lacked legal authority, noting his conduct “does not inspire confidence” given the delay in challenging the panel only after its findings proved adverse. The bench emphasised that any doubts about the validity of the process should have been raised at the outset, not post facto.
Senior Advocate Kapil Sibal, representing Justice Varma, argued that the in-house mechanism lacks constitutional sanction to recommend removal under Article 124 and the Judges Act, contending that the CJI’s recommendation represents an extra‑constitutional overreach. He maintained that the absence of safeguards such as cross‑examination and burden‑of‑proof reversals undermines the fairness of the inquiry.
The Court accepted Varma’s submission that the video depicting burnt currency found at his residence should not have been made publicly available via its website. However, it clarified that this publication did not amount to any lapse in the procedural framework, and does not detract from Parliament’s independent authority in impeachment proceedings.
The Court noted that precedent firmly supports the existence of the in-house procedure, referring to judgments such as C. Ravichandran Iyer v. A. M. Bhattacharjee and other Supreme Court rulings that uphold the system as an essential institutional safeguard. Justice Datta underscored that the term “otherwise” in Section 3 must have substance, reinforcing the judiciary’s prerogative to initiate non‑punitive disciplinary measures beyond criminal or civil actions.
The bench pointed out that Parliament retains full discretion to accept, reject or disregard the CJI’s recommendation. Impeachment proceedings, requiring at least 100 members in the Lok Sabha or 50 in the Rajya Sabha, remain unaffected by the in-house report being preliminary in nature. Justice Varma’s identity remains concealed in his petition as “XXX” to safeguard anonymity in judicial filings.
The matter, which began when burnt bundles of cash were discovered in a storeroom at his Delhi residence during a fire on 14 March, was formally investigated by a three-judge committee constituted by then‑CJI Sanjiv Khanna. The panel submitted its report in May, concluding that Justice Varma exercised control over the premises and recommending parliamentary action for removal.
Chief Justice B. R. Gavai recused himself from the case, prompting the constitution of the current bench to hear the matter.
Hearing extensive arguments, the Court reflected on the need for the judiciary to uphold institutional integrity through due process, while noting that any delay or perceived inconsistency in challenge undermines confidence in a sitting judge. The plea also includes separate petitions, including one by advocate Mathews J. Nedumpara seeking criminal enquiry, which the Court is concurrently adjudicating.
The Supreme Court's stance underscores the Chief Justice’s obligation not only to receive allegations, but to act decisively when misconduct evidence emerges—while Parliament alone retains power to enforce removal.