Chief Justice of India (CJI) Bhushan R. Gavai has declined to hear a plea filed by Justice Yashwant Varma of the Allahabad High Court and has directed that the matter be listed before another bench. The plea challenges a report finding Justice Varma guilty of misconduct in a cash discovery case. Justice Varma is seeking to invalidate the in-house inquiry panel's report and quash the recommendation for his impeachment.

The case originates from an incident earlier this year involving the discovery of a substantial amount of unaccounted cash at Justice Varma's residence following a fire. This led to the Supreme Court forming an inquiry committee, which found him guilty of misconduct. Subsequently, then-CJI Sanjiv Khanna recommended to Parliament that impeachment proceedings be initiated against Justice Varma. The government is reportedly planning to move a motion for Justice Varma's removal during the Monsoon session of Parliament, which commenced on July 21.

Justice Varma has contested the inquiry's findings, asserting that the committee acted with a predetermined narrative, reversed the burden of proof, and denied him a fair opportunity to defend himself. He argues that the in-house inquiry committee made its findings without giving him a fair opportunity to respond. He alleges that the committee proceeded in a pre-determined fashion and even without finding any concrete evidence, merely drew adverse inferences against him after reversing the burden of proof. He further claims that the committee failed to notify him of its devised procedure, denied him any opportunity to provide inputs on the evidence to be collected, examined witnesses in his absence, provided him with paraphrased statements instead of video recordings (despite availability), selectively disclosed only “incriminating” material, and ignored and failed to collect relevant and exculpatory material. In a letter to then CJI Khanna, Justice Varma rejected the committee's findings and declined the advice to resign or seek voluntary retirement, deeming the process a violation of natural justice and stating that stepping down would imply accepting a fundamentally unjust procedure.

Meanwhile, another related matter was brought before a bench comprising CJI Gavai and Justice K. Vinod Chandran by lawyer Mathews Nedumpara. Nedumpara sought an urgent hearing for a plea requesting the registration of a First Information Report (FIR) against Justice Varma concerning the cash discovery. The CJI declined the urgent listing. The Chief Justice also reprimanded Nedumpara for addressing the High Court judge as 'Varma', reminding him to maintain decorum and refer to him as "Justice Verma". CJI Gavai said, "Is he your friend? He is still Justice Verma. How do you address him? Have some decorum. You are referring to a learned judge. He is still a judge of the court,". Nedumpara has been persistent in seeking criminal proceedings. Nedumpara cited the alleged recovery of sacks of charred currency by first responders on March 14 as evidence requiring immediate police action. However, he also acknowledged a potential legal roadblock, the 1991 K Veeraswami judgment which bars registration of FIRs against sitting judges without the CJI's prior sanction. He has urged the court to review that ruling, arguing that it impedes the criminal law from taking its natural course.

Given CJI Gavai's decision to recuse himself from Justice Varma's plea, the Supreme Court will now constitute a special bench to hear the matter. Senior Advocate Kapil Sibal has sought an urgent hearing of the matter in the Supreme Court. The case is expected to raise significant constitutional questions.