How does prospective overruling by the Supreme Court balance judicial reform with legal certainty? Illustrate with a recent example.

Prospective overruling is the technique by which the Supreme Court declares a new legal position but applies it only to future cases and transactions, leaving past ones undisturbed. Introduced by CJI Subba Rao in I.C. Golaknath v. State of Punjab (1967) [1], it lets the Court correct itself without unsettling rights already crystallised.

How it enables judicial reform

• Frees the Court from being imprisoned by precedent: an interpretation shown to be over-broad or unworkable can be corrected without waiting for Parliament to legislate.
• Permits larger-bench correction of long-settled law — the escalation from a two-judge doubt to a nine-judge Constitution Bench is meaningful only if the outcome can actually change the law.
• Sustains the Court's role as an evolving interpreter of statutes and the Constitution, keeping law responsive to changed economic and administrative realities.

How it protects legal certainty

• Shields vested rights and concluded transactions from retrospective disruption, honouring the rule-of-law expectation that people ordered their affairs on the law as it then stood.
• Prevents a flood of reopened litigation before tribunals and High Courts.
• Gives litigants, employers and administrators a clear cut-off date, aiding predictability.

Illustration: the 2026 'industry' ruling

• In State of U.P. v. Jai Bir Singh (20 August 2026), a nine-judge Bench, by 5:4, refined — but did not overturn — the "Triple Test" for "industry" under Section 2(j), Industrial Disputes Act, 1947 [2], laid down in Bangalore Water Supply v. A. Rajappa (1978) [3].
• The refined test operates prospectively; all pending disputes under the now-repealed Act remain governed by the 1978 test [4], protecting workmen whose claims were already filed.
• The Court also directed that "industry" under the Industrial Relations Code, 2020 [5] be read independently, leaving the field open to legislative choice.

Prospective overruling thus mediates between correction and continuity: reform is not deferred, yet settled expectations are not defeated. Its legitimacy, however, depends on sparing use and reasoned justification, so that judicial law-making complements rather than displaces Parliament — a balance consistent with the constitutional scheme of separated powers.