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1969 DIGILAW 204 (CAL)

Lal Behari Frosad Chowdhury v. Parasmull Jain

1969-08-14

A.K.Mukherji, B.K.MUKHERJEE

body1969
JUDGMENT 1. THIS appeal is directed against an order of a learned interlocutory Judge passed on June 18, 1968, on an application by the defendant in a suit brought under Order xxxvii of the Code of Civil Procedure, for enlargement of time to make the application and for unconditional leave to defend the suit. It appears to be a composite application under section 5 of the Limitation Act and rule 3 of Order XXXVII of the Code of civil Procedure. Summons in the suit was served on the defendant on May 3, 1968. The application was made on june 14, 1968. There is, therefore, no dispute that in so far as it is an application under Order XXXVII, rule 3, it is out of time having regard to Article 118 of the Limitation Act. 2. THE order made by the learned judge reads as follows : "it is ordered that upon the said applicant furnishing on or before Monday, the second day of September next, security to the extent of Rs. 10,000/- only to the satisfaction of the Registrar of this Court, the delay in filing this application be condoned and the time for making this application be extended and it is further ordered that in that event the said applicant shall be at liberty to enter appearance in and defend this suit" It appears at first sight that the court has enlarged the time to make the application on term and in the event of the order for enlargement of time taking effect by compliance with the term, the applicant has been granted liberty to enter appearance and defend the suit. It is open to argument that leave to defend the suit has also been granted on term because the defendant will be entitled to enter appearance and defend the suit only if the delay is condoned but the delay is to be condoned only on compliance with the term. The term imposed for enlargement of time, therefore, exercises a remote control on leave to defend. If this argument is pursued a little further it may be legitimately contended, that it is not the order enlarging time which has been made on term though formally it appears to be so, but in substance it is the order granting leave to defend the suit which has been made on term. If this argument is pursued a little further it may be legitimately contended, that it is not the order enlarging time which has been made on term though formally it appears to be so, but in substance it is the order granting leave to defend the suit which has been made on term. The logic of the situation demands that unless time is enlarged the application cannot be treated as competent and unless the application is treated as competent, no leave can be granted on the application. In that view of the matter, we hold that the term imposed by the learned judge attaches to leave to defend and not to enlargement of time. 3. A preliminary objection was taken as to the maintainability of the appeal. In so far as the order is for enlargement of time certain decisions of this Court appear to conclude the question. In (1) Gobindalal Das v. Shibadas Chatterjee, 33 ILR Calcutta 1323 it was decided by a Full Bench of this Court that an order refusing to enlarge the time for preferring an appeal, which is already time-barred, is not a judgment within the meaning of clause 15 of the Letters Patent, and is not, therefore, appealable under that clause. In (2) Brojogopal Roy Burman v. Amar Chandra Bhattacharjee and ors., AIR 1929 Cal. 214 another Full bench presided over by Rankin, C. J., held that a decision under Section 5 of the Limitation Act admitting an appeal after the period of limitation merely declares that an appeal is entertainable. It is not a judgment and no appeal lies against it under Clause 15. In this connection, I ought to point out that if an order is made enlarging time on terms, it may raise a serious question of the power and jurisdiction of the court to make the order and the order may be appealable on that ground alone. 4. SECTION 5 of the Limitation Act provides that an appeal or an application may be admitted after the period of limitation prescribed there for, when the appellant or the applicant satisfied the court that he had sufficient cause for not preferring the appeal or making the application within such period. It is well to remember that there is nothing in the section which contemplates imposing a term for enlargement of time. It is well to remember that there is nothing in the section which contemplates imposing a term for enlargement of time. Be that as it may, as we have held in the present case that the term imposed by the order under appeal in substance, attaches to the leave to defend and not to enlargement of time to make the application, we must also hold, on the basis of the Fall bench decisions, that that part of the order by which time has been enlarged is not appealable. The next question which arises is whether the other part of the order granting leave to defend the suit on terms is appealable. Such an order is not appealable under Order 43 Rule 1 of the Civil Procedure Code. An appeal will lie, therefore, if at all, only if the order is a 'judgment' within the meaning of Clause 15 of the Letters patent. 5. CLAUSE 15 of the Letters Patent of the Calcutta, Bombay and Madras high Courts corresponds to clause 10 of the Allahabad High Court and the nagpur High Court. The scope of the expression 'judgment' within the meaning of the relevant clauses of the Letters patent of different Indian High courts has repeatedly come up for judicial determination. There is a cleavage of opinion on that question. The supreme Court has not yet pronounced on the meaning and scope of 'judgment' in the Letters Patent. In (3) Asrumati debi v. Rupendra Deb Raikat, A.I.R. 1953 S.C. 198 in an appeal preferred from an order transferring a suit from a district court to the High Court under Clause 13 of the letters Patent the Court said: "in view of the wide divergence of judicial opinion, it may be necessary for this court at some time or other to examine carefully the principles upon which the different views mentioned above purport to be based and attempt to determine with as much definiteness as possible the true meaning and scope of the word 'judgment' as it occurs in clause 15 of the Letters Patent of the calcutta High Court and in the corresponding clauses of the Letters patent of the other High Courts. We are, however, relieved from embarking on such enquiry in the present case as we are satisfied that in none of the views referred to above, could an order of the character, which we have before us, be regarded as a "judgment" within the meaning of clause 15 of the Letters Patent. " 6. IN (4) State of Uttar Pradesh v. Vijay Anand, AIR 1963 SC 946 in an appeal from a judgment and order of a division Bench of the Allahabad High court confirming those of a single judge of that Court dismissing an application for review of an order, Subba rao, J. found that "it is not necessary in this case to attempt to reconcile the said decisions or to give a definition of 140 our own, for on the facts of the present case the order under appeal would be a judgment within the meaning of the narrower definition of that expression." the question again came up before the supreme Court in (5) Shankarlal v. Shankarlal, AIR 1965 SC 507 in an appeal from an order made by a Division bench of the Calcutta High Court refusing to confirm a sale by the liquidators of the assets of a company. It was contended that the order under appeal was not a 'judgment'. Ayyanger, J. speaking for the Court held that in any event the order was appealtable under Section 202 of the Companies act and, therefore, the matter could be disposed of without going into the question of what is a 'judgment' and what is not. The learned Judge said: "there has been very wide divergence of opinion between the several High Courts in India as to the content of the expression 'judgment' occurring in Clause 15 of the Letters Patent. This conflict of opinion was referred to by this Court in (3) Asrumati Debi v. Rupendra Deb raikot AIR 1953 SC 198 and in (4) State of Uttar Pradesh v. Maherajkumar of Vizianagram, AIR 1963 SC 946 where, after setting out the cleavage of views on the question by sever al High Courts, the point as to the proper constructions of the word was left open for future decision when the occasion required. We consider that that occasion has not arisen before us either since in view of the construction which we have adopted of Section 202 of the Indian Companies Act the scope of the expression 'judgment' in the letters Patent does not call for examination or final decision. " 7. IN the absence of final determination of the meaning and scope of the expression 'judgment' by the supreme Court, the classic and controversial definition of 'judgment' as expressed by Sir Richard Couch, C J. in (6) Justice of the Peace for Calcutta v. Oriental Gas Company, 8 Beng. LR 433 remains good law so far as this Court is concerned. Sir Richard Couch in his oft-cited judgment said : "we think that 'judgment' in Clause 15 means a decision which affects the merits of the question between the parties by determining some right or liability. It may be either final or preliminary, or interlocutory, the difference between them being that a final judgment determines the whole cause or suit, and a preliminary or interlocutory judgment determines only a part of it, leaving other matters to be determined. " 8. IN (3) Asrumati v. Rupendra, B. K. Mukherjea, J. speaking for the court explained the scope and import of the definition given by Couch, C. J. in these words:- "couch, C. J., as said already, defined 'judgment' to be a decision which determines some right or liability affecting the merits of the controversy between the parties. It is true that according to the learned Chief justice an adjudication, in order that it might rank as a 'judgment' need not decide the case on its merits, but it must be the final pronouncement of the Court making it, the effect of which is to dispose of or terminate the suit or proceeding. "This will be apparent from the following observation made by Couch, C. J., in the course of his judgment: "it is, however, said that this Court has already put a wider construction upon the words 'judgment' in Clause 15 by entertaining appeals in cases where the plaint has been rejected as insufficient, or as showing that the claim is barred by limitation, and also in cases where orders have been made in execution. These however are both within the above definition of a judgment, and it by no means follows that, because we hold the order in the present case not to be appealable, we should be bound to hold the same in the cases referred to. For example, there is an obvious difference between an order for the admission of a plaint and an order for its rejection. The former determines nothing, but is merely the first step towards putting the case in a shape for determination. The latter determines finally so far as the Court which makes the order is concerned that the suit, as brought, will not lie. The decision, therefore, is a judgment in the proper sense of the term." B.K. Mukherjea, J. thereafter pointed out that the definition of 'judgment' by Arnold White, C.J. in the Full Bench decision of the Madras high Court in (7) Tuljaram v. Alagappa, 35 ILR Madras 1 (F.B.) is also founded on the same principles on which the definition of 'judgment' by Sir Richard Couch is founded. 9. IN our opinion, in applying the definition of 'judgment' given by Sir richard Couch, C.J. to a particular case it would be safe to be guided, in the forest of judicial decisions on the subject, by the light the Supreme court threw on the definition of 'judgment' by Couch C.J., in Asrumati's case and to understand the definition in the sense in which B.K. Mukherjea. J. understood it. Incidentally, it may not be out of place to mention that the view expressed by Sir Richard couch, C.J. on the meaning of 'judgment' and its elucidation by B.K. Mukherjea, j. are supported by the latest definition of 'judgment' given by hidayatullah, J. in (8) Monohar v. Baliram, AIR 1952 Nagpur 357 (F.B. ). The tests laid down by Hidayatullah, j. are expressed in these terms : "a judgment means a decision in an action whether final, preliminary, or interlocutory which decides either wholly or partially but conclusively in so far as the Court is concerned, the controversy which is the subject of the action. It does not include a decision which is on a matter of procedure, nor one which is ancillary to the action even though it may either imperil the ultimate decision or tend to make it effective. It does not include a decision which is on a matter of procedure, nor one which is ancillary to the action even though it may either imperil the ultimate decision or tend to make it effective. The decision need not be immediately executable per se but if left untouched must result inevitably without anything further, save a determination of consequential details, in a decree or decretal order, that is to say, an executive document directing something to be done or not to be done in relation to the facts of the controversy. The decision may itself order that thing to be done or not to be done or it may leave that over till after the ascertainment of some details but it must not be interlocutory having for its purpose the ascertainment of some matters or details prior to the determination of the whole or any part of the controversy." 10. IN referring to the above definition of 'judgment' by Hidayatullah, j. I have not forgotten that the Madras high Court in (9) Palaniappa v. Krishnamurti, (F.B.) AIR 1968 Mad. 1 declined to subscribe to the definition given by Sir Richard Couch and endorsed an observation in (10) Central brokers v. Ramnarayan Poddar and Co., air 1954 Mad. 1057 where with reference to the definition of judgment given by Hidayatullah, J. Mack, J. said : "i venture to express the hope here that no further attempt will ever be made by any Bench however full and however authoritative as, in my view, to define the word 'judgment' in the year 1954 as the framers of the statute intended the word to apply in 1882 or 1865 is attempting an impossibility." The question then arises whether an order granting leave on terms under Order XXXVII, Rule 3 of the code of Civil Procedure is a 'judgment' within the meaning of clause 15 of the Letters Patent as defined by Sir richard Couch, C. J. in (6) Justices of the Peace v. Oriental Gas Co. with the gloss put upon that definition by the supreme Court in (3) Asrumati v. Rupendra. 11. IN (11) Sukhlal Chundermull v. Eastern Blank Ltd., ILR 42 Cal. with the gloss put upon that definition by the supreme Court in (3) Asrumati v. Rupendra. 11. IN (11) Sukhlal Chundermull v. Eastern Blank Ltd., ILR 42 Cal. 735 it; was held by 'a Full Bench of this court presided over by Sir Lawrence jenkins, C.J. that an order made by a single Judge sitting on the Original side under order XXXVII, Rule 2 of the Code of Civil Procedure directing a defendant to give security on terms on which leave to defend should be given is not a judgment within the meaning of clause 15 of the Letters patent and is not appealable. The learned Chief Justice based his decision on what was said by Sir Richard couch in (6) Justices of the Peace for Calcutta v. Oriental Gas Co. 12. THE question again came up for consideration by a Division Bench of this Court in (12) Banwarilal Roy w. Sohanlal Daga, ILR 1955 Cal. 299 where P, B. Chakravartti, C. J. in an elaborate and closely reasoned judgment expressed the view that an order granting leave on terms to defend a suit brought under Order XXXVII of the Code of Civil Procedure is not appealable as a 'judgment' within the meaning of Clause 15 of the Letters patent. The learned Chief Justice poin ted out that under Order XXXVII of the Code of Civil Procedure of our high Court an order granting leave to defend on terms or refusing leave does not result automatically, or as a matter of course, in a decree. No leave to defend the suit may be given and yet the suit may be dismissed. As for example, the learned Chief Justice pointed out, in passing a decree under order XXXVII the Court will at least examine whether summons has been served on the defendant or whether the suit is barred by limitation The learned Chief Justice might very well have added that the Court may also have to determine at the final stage whether the instrument on which the suit is brought is inadmissible in evidence under Section 35 of the Indian stamp Act or even whether the instrument is a negotiable instrument at all or is only an unusual visitor in the accustomed circle of negotiable paper, to use the language of Lord Atkin in (13) Akbar Khan v. Attar Singh, 63 IA 279. In my opinion it is quite clear that under our rules of Order XXXVII refusal of leave to defend does not result in a decree as a matter of course. The Court has to apply its mind once again in passing a decree. In the case decided by Chakravartti, C.J. reliance was placed at the bar on a decision of the Bombay High court in (14) Ramanlal Shantilal and Co. v. Chimanlal Damodardas, ILR 56 Bom. 268 where a Bench presided over by beaumount, C.J. decided that "an order under Order XXXVII, Rule 2 of the civil Procedure Code, directing a defendant to deposit a certain amount as a condition precedent to giving him leave to appear and to defend in a summary suit, in substance determines the rights between the parties to that suit, since, if the defendant fails to deposit the requisite amount it entitles the plaintiff to the order claimed in the plaint. Such an order, therefore, is a 'judgment' within the meaning of clause 15 of the Letters Patent. " The rules of the Bombay High Court as they stood then were not materially different from ours except that under sub rule (1) of rule 2 a variety of causes other than claims based on negotiable instruments were brought within the scope of Order XXXVII. The Bombay high Court had also framed rules for final judgment in a summary procedure similar to the rules under Chapter xiiia of our High Court. The learned judges of the Bombay High Court in coming to the conclusion that the order granting leave on terms to defend the suit was a 'judgment' thought that refusal to grant leave in substance entitles the plaintiff to the order claimed in the plaint as a matter of course. Sir john Beaumount, C. J. said "if in a summary suit in which leave to defend is refused and in consequence decree follows as a matter of course in favour of the plaintiff and there is an appeal against the decree, it is obvious that the Court of Appeal cannot go into the merits of the suit, because the merits have not been tried, and all that the defendant can do in such a case is to challenge the interlocutory order. But in the meantime the plaintiff, having got his final decree, may have levied execution, and it may be too late for practical purposes for the defendant to challenge the interlocutory order. If in substance an appeal lies from an interlocutory order refusing leave to defend by the process of challenging the order on an appeal from the final order, it is obviously more convenient that there should be a right of appeal direct from the interlocutory order. I think we must look at the substance of this matter and consider what the real effect of the order is, having regard to the provisions of Order XXXVII, rule 2, and I think we ought to hold that the effect of the order is to determine the rights between the parties, since in substance it entitles the plaintiff to the order claimed in the plaint. That being so, think such an order is technically a judgment within the meaning of clause 15 of the Letters Patent." 13. CHAKRAVARTTI, C. J. was of opinion that the learned judges of the bombay High Court were creating by judicial decision a right of appeal on equitable considerations. In so far as they held that the order is a 'judgment' because a decree follows as a matter of course in the scheme of Order XXXVII he thought that the reasonings of the learned judges of the Bombay High court were not sound because a decree did not automatically follow from the interlocutory order refusing leave to defend. Chakravartti, C.J. was, however, careful to point out that the order under appeal in the Bombay case might have been a 'judgment' in the context of the Bombay High Court rules of summary procedure. It is clear that in holding that the order before him was not an appealable order, he rested his decision on the definition of 'judgment' given by Sir Richard couch C.J. which he understood to be an order, the effect of which is to dispose of or terminate the suit or proceeding in its entirety or in part. 14. IT is not a little unfortunate that the judgment in Asrumati v. Rupendra which was delivered on 27th february, 1953 could not be placed before chakravartti, C.J. who delivered his judgment on 17th April, 1953. 14. IT is not a little unfortunate that the judgment in Asrumati v. Rupendra which was delivered on 27th february, 1953 could not be placed before chakravartti, C.J. who delivered his judgment on 17th April, 1953. Had the attention of the learned Chiefjustice been drawn to the judgment of b. K. Mukherjea, J. in Asrumati's case the learned Chief Justice would have had the satisfaction of knowing that his judgment was fortified by the pronouncement of the Supreme Court. We may now refer to the recent decision of the Supreme Court in (15) Milkhiram (India) Private Ltd. v. Chamanlal Bros., AIR 1965 SC 1698 where in an appeal from the Bombay high Court on the question whether the trial judge was right in making an order granting leave to the appellants to defend a suit brought under Order xxxvii of the Civil Procedure Code, mudholkar, J. said at page 1702 of the report: "no doubt an appeal lay against it under the Letters Patent". This statement has to be understood in the context of the Bombay High court Rules under Order XXXVII of the Civil Procedure Code as they stand today. In 1940 the rules under Order xxxvii were extensively amended by the Bombay High Court. Order xxxvii, Rule 3, suffered a sea-change. In Bombay, in a suit brought under order XXXVII the defendant can enter appearance without leave of court. In Calcutta he cannot. In bombay, if the defendant does not enter appearance, the plaintiff may obtain a decree under Order XXXVII, rule 2. If the defendant enters appearance then under Order XXXVII, rule 3 of the Bombay High Court Rules the plaintiff has to serve on the defendant a summons for judgment supported by an affidavit verifying the cause of action and the amount claimed and stating that in his belief there is no defence in the suit. In that event the defendant may at any time within 10 days from the service of such summons for judgment by affidavit or otherwise apply on such summons for leave to defend the suit. Leave to defend may be granted to him unconditionally or upon such terms as to the judge appear just. In that event the defendant may at any time within 10 days from the service of such summons for judgment by affidavit or otherwise apply on such summons for leave to defend the suit. Leave to defend may be granted to him unconditionally or upon such terms as to the judge appear just. At the hearing of such summons for judgment, if the defendant has not applied for leave to defend or if such application is made and refused, the rules provide that the plaintiff shall be entitled to judgment forthwith or if the defendant be permitted to defend as to the whole or any part of the claim, the judge shall direct that on failure to complete the security, if any or to carry out such other direction as the judge may have given within the time limited in the order, the plaintiff shall be entitled to judgment forthwith. 15. IT will be seen that under the bombay Rules final judgment follows as a matter of course if leave to defend is not given or where it is given on terms, the terms are not complied with. Therefore, in Bombay, an order made under Order XXXVII, Rule 3, refusing leave to defend or granting leave on terms puts an end to the suit and, is, therefore, indisputably a judgment. The statement of Mudholkar, J. therefore, is clearly referable to the Rules of Order XXXVII of the Bombay High court and has no relevance to an order made under Order XXXVII, Rule 3 of the Calcutta High Court Rules. 16. AN order refusing leave to defend or granting leave on terms does not put an end to the suit or to any part of it although it may result in admission of allegations in the plaint. The court will yet have to apply its mind to the suit before it passes a decree as was pointed out by Chakravartti, C. J. in Banwanlal's case. Incidentally, it may be pointed out that the provision in Order XXXVII, Rule 2 that in default of the defendant obtaining leave to enter appearance and defend the suit, the allegations in the plaint shall be admitted does not mean that questions of law which the plaint raises expressly or impliedly are to be decided in favour of the plaintiff by admission. Questions of law cannot be decided by concession or admission. Questions of law cannot be decided by concession or admission. The words "allegations in the plaint' in order XXXVII, Rule 2, therefore, can only mean allegations of fact and nothing more. They do not include questions or submissions of law. By admission of allegations in the plaint, the potential issues of fact which arise on the basis of the plaint are answered in favour of the plaintiff or rather, those issues, by reason of the admission, do not arise at all. But to answer an issue or some issues is not necessarily to dispose of the suit. Until a decree is passed in a suit brought under order XXXVII of the Code of Civil procedure the rights and obligations of the parties remain very much at large. If the order made under Order xxxvii, Rule 3 had resulted in a decree as a matter of course, only then the order could have been a 'judgment' within the meaning of clause 15 of the letters Patent. The order is not a judgment and is not, therefore, appealable as such. Counsel appearing for the appellant contended that if one part of the order is appealable but the other part is not, the order as a whole is appealable. As we have held that no part of the order is appealable, it is not necessary to go into that question. The appeal is therefore dismissed with costs. All interim orders are vacated.