CJI begins probe on HC judge over cash recovery

Chief Justice of India (CJI) Sanjiv Khanna has initiated an initial inquiry against Delhi high court judge Yashwant Varma over the discovery of large amounts of cash at the latter’s residence in the Capital last week, people aware of developments said on Friday, even as the controversy reached Parliament and fuelled an outcry.

According to the people cited above, CJI Khanna sought a report from Delhi high court chief justice Devendra Kumar Upadhyaya before finalising the next course of action. According to one of the persons cited above, justice Upadhyaya was alerted by CJI Khanna soon after the incident of March 14 was brought to his notice. “The CJI had asked the high court chief justice to also seek justice Varma’s viewpoint before sending the final report regarding the episode,” this person said, requesting anonymity.

On Thursday evening, the Supreme Court collegium recommended the Centre to repatriate justice Varma to Allahabad high court, his parent high court.

A second person told HT that the high court chief justice submitted the report on Friday night. “During his meeting with the other judges of the Supreme Court on Friday morning, the CJI told them that he was awaiting justice Upadhyaya’s report, which is expected by the end of the day. Justice Khanna also told them that while he is willing to take the matter to its logical end, procedural norms required him to first seek a report from the HC chief justice,” this person said.

This person added that it was justice Upadhyaya who first received the video of the cash at justice Varma’s residence -- some of which was burnt. Members of the collegium were told about the video, ostensibly made by first responders from either the fire department or the police, before proposing to move on Varma’s transfer.“CJI Khanna also advised justice Upadhyaya to attach this video with his final report if he wanted this to be considered,” the second person added.

The discovery of a huge stash of cash – the exact quantum of the recovery is not known – happened in the store room in the judge’s Tughlak Road bungalow after a fire around 11.35pm on March 14, prompting the Delhi fire department personnel to rush to the spot. At the time, the judge and his wife were in Bhopal. “The fire was doused within five minutes,” said Delhi Fire Services director Atul Garg. When asked about any cash in the house or the store room, Garg denied any knowledge. “No information is available on record about this,” he said.

He was more candid earlier in the day. “Our firefighters did not find any cash during their fire fighting operation,” he had told news agency PTI.

The controversy made ripples in the legal fraternity. The matter was even raised before chief justice Upadhyaya by senior advocate Arun Bhardwaj, who urged the court administration to take steps to prevent such incidents in the future. “We are shaken and demoralised,” Bhardwaj said. To this, chief justice Upadhyaya replied: “So is everybody…We are conscious.”

Adding to the growing discontent, the Allahabad High Court Bar Association (HCBA) strongly opposed the collegium’s decision to transfer justice Varma and said the matter raised the question whether “the Allahabad High Court is a trash bin”.

In the Rajya Sabha, chairman Jagdeep Dhankhar said he will find a mechanism for holding a structured discussion on the issue and appeared to make a reference to the contentious National Judicial Appointments Commission, without naming it, after Congress MP Jairam Ramesh sought the Chair’s response on judicial accountability.

As the controversy spiralled, the apex court issued a statement to clarify the order of events, and said the Delhi high court chief justice’s inquiry was initiated before Thursday’s collegium meeting and the report was expected on Friday.

“The proposal for transfer of Mr. justice Yashwant Varma, who is the second senior most judge in the Delhi high court and a member of the collegium, to his parent high court i.e. the high court of judicature at Allahabad, where he will be ninth in seniority, is independent and separate from the In-house enquiry procedure,” the court statement said.

“The proposal was examined by the collegium comprising of the Chief Justice of India and four senior most judges of the Supreme Court on 20th March 2025, and thereafter letters were written to the consultee judges of the Supreme Court, the chief justices of the high courts concerned and Mr. justice Yashwant Varma. Responses received will be examined and, thereupon, the collegium will pass a resolution,” the statement added.

As per established protocol, the decision regarding an in-house inquiry can be taken by the CJI only after evaluating the report from the high court chief justice. The in-house inquiry procedure, formulated by the Supreme Court in 1999, mandates that when allegations of impropriety or corruption surface against a constitutional court judge, the CJI first seeks the judge’s response. If the response is unsatisfactory, the CJI can constitute a panel comprising a Supreme Court judge and two high court chief justices to investigate the allegations further. The findings of such a panel can lay the groundwork for further action, including potential parliamentary impeachment proceedings if the allegations are proven.

With the report from justice Upadhyaya expected soon, the next steps in the matter will depend on the assessment of its findings by CJI Khanna, who has assured Supreme Court judges that he is committed to ensuring judicial integrity while adhering to due process.

During a collegium meeting on Thursday, while a unanimous decision was taken to propose the transfer of justice Varma back to the Allahabad high court, some Supreme Court collegium members strongly urged CJI Khanna to go beyond the transfer and initiate an in-house inquiry against the judge, underscoring the need for stringent action to uphold judicial ethics. The collegium is headed by the CJI and also includes justices Bhushan R Gavai, Surya Kant, Abhay S Oka and Vikram Nath.

On Thursday, two judges in the collegium forcefully argued that mere transfer was not the “real solution” and that stronger steps were necessary to maintain public confidence in the judiciary. One collegium member insisted that justice Varma should immediately be stripped of judicial work, while another judge strongly advocated for an in-house inquiry, emphasising that such a serious incident demanded institutional accountability.

As the row intensified, the Allahabad High Court Bar Association (HCBA) opposed the Supreme Court collegium’s decision. “Corruption is unacceptable,” the HCBA wrote, adding that it was “taken aback” by the decision to transfer justice Varma to his parent high court. “This matter becomes important when we examine the current situation wherein the Allahabad High Court is short of honourable judges and despite the continuous problems, new judges have not been appointed for years,” the letter read.

Justice Varma was originally appointed as a high court judge in 2014. He was appointed to the Delhi high court in October 2021, following a recommendation by the Supreme Court collegium headed by then-CJI NV Ramana. Before his elevation, he served as special counsel for the Allahabad high court and held the position of standing counsel for the Uttar Pradesh government.