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Pooja Ramesh Singh v. Jammu and Kashmir Bank Ltd.

Civil Appeal · 2026 INSC 668Decided 2 Jul 2026
C.A. No.-011950 - 2025
Justice Pamidighantam Sri Narasimha · Justice Alok Aradhe

Background

The appellant, a suspended director of a corporate guarantor company (Essel Infraprojects Ltd.), challenged insolvency proceedings initiated against the company by Jammu and Kashmir Bank over defaulted loans owed by a group company. The National Company Law Tribunal (NCLT) had admitted the bank's insolvency application and this was upheld by the NCLAT on appeal. Crucially, the appellant's counsel discovered that several of the case citations the NCLT relied on to reject the appellant's arguments about the guarantee were fake, non-existent, or misquoted - apparently generated by artificial intelligence and never actually verified.

Decision Breakdown

The Supreme Court independently checked each of the six precedents cited by the NCLT and confirmed that some were wrongly cited, some had correct case names but fabricated quoted paragraphs, and some did not exist at all. The bank confirmed its own lawyers had not cited these cases - meaning the tribunal itself had generated or sourced this fake material, and the appellate tribunal (NCLAT) failed to catch the error either. The Court held that any decision tainted by fake or hallucinated material, however minor, is "no decision in the eyes of the law" and must be set aside, declaring zero tolerance for both lawyers and judges who cite unverified AI-generated case law. Both the NCLT and NCLAT orders were set aside, and the insolvency application was sent back for fresh consideration, with a direction that the Bar Council of India form a committee to address advocates submitting fabricated AI-generated material as precedent.

Lesson Learnt

Artificial intelligence tools can fabricate convincing-looking case citations and quotations that do not actually exist ("hallucinations"), and courts, tribunals, and lawyers must independently verify every precedent before relying on it - a decision built even partly on fake legal authority has no legal validity at all and will be struck down.

Official source (sci.gov.in)View Judgment (PDF)

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