The Supreme Court has dismissed Justice Yashwant Varma's plea challenging the in-house inquiry process and its findings related to the cash recovery case. The ruling, delivered on Thursday, upholds the legality of the in-house inquiry and its subsequent report, effectively closing the door on Justice Varma's legal challenges within the judicial system.

The case originated from the recovery of a significant amount of cash from an outhouse in Justice Varma's official residence in Delhi on March 14, during a fire-fighting operation. At the time, Justice Varma was serving as a judge of the Delhi High Court. The discovery led to an in-house inquiry, which found Justice Varma complicit in the matter.

Justice Varma sought to invalidate the report by the in-house inquiry panel, arguing that the process was flawed. His legal team, led by senior advocates Kapil Sibal and Mukul Rohatgi, raised several arguments, but a Supreme Court bench of Justices Dipankar Datta and A G Masih rejected them. The court affirmed that the inquiry process adhered scrupulously to the in-house procedure established by the Supreme Court in its previous judgments.

In its verdict, the Supreme Court emphasized that the in-house inquiry process is distinct from the constitutional process for removing a High Court judge. The court also addressed the argument that Justice Varma was not granted a hearing before the recommendation for his removal, stating that such a hearing is not a matter of right and its absence did not violate any procedure. Furthermore, the court criticized Justice Varma's conduct, stating that it "does not inspire confidence".

The Supreme Court's decision also validates the recommendation made by then Chief Justice of India (CJI) Sanjiv Khanna to the President and Prime Minister to initiate a removal motion against Justice Varma. The court deemed CJI Khanna's letter as constitutional.

With the Supreme Court dismissing Justice Varma's plea, the matter is now likely to proceed to Parliament for impeachment proceedings. The only remaining avenue for Justice Varma to challenge his impeachment is before the Parliament.