Oriental Fire and General Insurance Company Limited v. J. Thomas and Company
1990-10-22
B.P.SARAF
body1990
DigiLaw.ai
The appellants in this case were defendants along with one M/s "j. Thomas & Co. in the suit filed by the respondent No. I. The appellant No. 1 is M/s Oriental Fire & General Insurance Company Limited and appellant No. 2 is M/s Phoenix Assurance Company Limited. The appellant No. 2, in fact, merged with the appellant No. 1 and, as such, has no independent existence of its own since the merger. For bravity, the appellants shall be hereinafter referred to as "the appellant's". In the year 1968, a suit was filed by the plaintiff-respondent No. 2, Sarojini Tea Co. (P) Ltd., against the present appellants and the respondent No. 1 herein who was arrayed as defendant Na. 2. A joint and several decree for a sum of Rs. 10.216/- with interest @ 6% from the date of filing of the suit till recovery of decretal amount was passed against the appellants and the respondent No. 1. The present appellants did not file any appeal against the said judgment and decree. The respondent No. 1 who was defendant No. 2 in the original suit, however, alone filed an appeal and challenged the decree not on merits but on a limited point pertaining to its own liability. In the mid appeal, the present Insurance Companies (appellants) ware also made respondents. They, however, did not turn up to contest the appeal. The appeal was allowed by the learned District Judge, Dibrugarh and the judgment and decree of the trial Court were modified. It was directed that the Decree shall be executed only against defendant No. 1, namely, the insurance company, appellant No. 1. The insurance company has filed the present second appeal before this Court. Mr. D. N. Baruah, tha learned counsel for the respondent No. 2 raised a preliminary objection as to the maintainability of this appeal on the ground that the present appellants "having not filed any appeal against the judgment and decree passed by the trial Court, are not entitled to prefer a second appeal against the judgment passed o appeal filed by other defendant, namely, defendant No. 2 who challenged the decree is appeal not on merits but only in so far as it purported to make it jointly and severally liable along with the other defendants. Mr.
Mr. A.R. Banerjee, the learned counsel for the appellant, on the ether hand, submits that the present second appeal is maintainable in view of the provisions of Rule 4 of Order 41 of the Civil Procedure Code, 1908, hereinafter referred to as 'the CPC'. According to the counsel for the respondents reliance on Order 41 Unto 4 is misplaced. The said provision is not applicable to the facts of the present case. I have considered the submission. Te appreciate the rival contentions it is necessary to first refer to the provision of Rule 4 of Order 41. it reads : "4. One of several plaintiffs or defendant may obtain reversal of whole decree where it proceeds ground common to all - Where there are more plaintiffs or more defendants than one in a suit, and the decree appealed from proceeds on any ground common to all the plaintiffs or to all the defendants, any one of the plaintiffs or of the defendants may appeal from the whole decree, and thereupon the Appellate Court may reverse or vary the decree in favour of all the plaintiffs or defendants, as the case may be." The submission of Mr. Baruah, learned counsel for the respondents is that one of the basic requirement for applicability of Rule 4 of Order 41, namely that the decree appealed from proceeds on any ground common to all the defendants being absent. In the instant case, Rule 4 of Order 41 has no application and the present appeal is not maintainable. The second submission of Mr. Baruah it that even if the appeal it maintainable, the non-appealing defendant cannot be allowed to raise a ground which was not raised before the first appellate Court as it will amount filing, in the garb of a second appeal, a first appeal before the High Court which is not permissible. I have considered the submissions. Also heard Mr. A. R. Banerjee, the learned counsel for the appellant who submits that Rule 4 of Order 41 is applicable to the facts of the present case and that it is open to the non-appealing defendant even if it did not file an appeal against the decree or did not contest the appeal filed by other defendant, to challenge the decree on all grounds available to it before the High Court in the second appeal.
His contention is that the right of appeal of the non-contesting defendant cannot be restricted to the grounds raised in the first appeal as the said appeal had not been filed by it. Before dealing with the legal issues raised in this appeal, it is necessary to briefly state the facts of the case. The appellants herein are insurance companies. The respondent No. 2 is a company which owns a tea estate and carries on business of manufacture, sale and supply of tea. It entered into a contract of insurance with the appellants and paid the requisite premium. The insurance company issued policy of insurance. It was a maxim policy which covered, the defendant No. 2 in respect of any loss or damage to the goods covered by the said policy. During the existence of the said policy some consignments of tea dispatched by the respondent No. 2 were damaged. The respondent No. 2 raised a claim on the insurance company. The claim was for a sum of Rs. 10,216.69. The insurance company did not pay the claim on the ground that the respondent No. 2 failed to send a notice of claim in respect of the loss suffered by it to the carriers concerned. The case of the tea estate was that it was not f r it to do so as that was the responsibility of the respondent No. 1 herein, the broker, J. Thomas and Company with whom the insurance company had contact to that effect Respondent No 1 denied any such responsibility. The insurance company having failed to pay the amount, the tea estate filed a suit for recovery of a sum of Rs. 11, 873.69 inclusive of interest amounting to Rs 1657/- In the said suit, besides the insurance company the broker, namely, J. Thomas and Co. was also impleaded as one of the defendants.
The insurance company having failed to pay the amount, the tea estate filed a suit for recovery of a sum of Rs. 11, 873.69 inclusive of interest amounting to Rs 1657/- In the said suit, besides the insurance company the broker, namely, J. Thomas and Co. was also impleaded as one of the defendants. In para 14 of the plaint the reason for showing the broker, J Thomas and Co, as one of the main defendants, was stated in the following words: "The plaintiff has joined the defendant No. 2 as main defendant along with the defendant No. 1, as it appears the defendant No. 2 has been taking a peculiar, inconsistent and self contradictory stand and hence the plaintiff thinks it advisable to lay all facts before the Court for consideration." These are briefly the facts as indicated above, the trial Court upheld the claim of the plaintiff tea estate and passed a decree making both defendants 1 and 2, namely, the insurance company and the broker, jointly and severally liable for the decreed amount. The insurance company did not challenge the judgment and decree of the trial Court, Only the broker, J. Thomas and Company, who was made jointly and severally liable with the insurance company for payment of the decretal amount, filed an appeal before the District Judge, Dibrugarh. The insurance company was impleaded as one of the respondents. In the appeal the findings of the trial Court were assailed only in so far as they related to the defendant No.2,J. Thomas and Company. The contention before the appellate Court was that there was no cause of action against defendant No. 2, that the defendant No. 2 had no obligation to prefer claim against the carriers nor was it liable to pay any amount by way of damages to the plaintiff. The learned appellate Court too in its judgment confined the discussion to the aforesaid submissions only in so far as they related to the liability of defendant No. 2 and the appellant before it. The findings of the trial Court on merits were neither challenged nor scrutinised by the first appellate Court. The first appellate Court, on consideration of the facts and circumstances of the case, held that there was no cause of action against the defendant No. 2 J. Thomas & Co.
The findings of the trial Court on merits were neither challenged nor scrutinised by the first appellate Court. The first appellate Court, on consideration of the facts and circumstances of the case, held that there was no cause of action against the defendant No. 2 J. Thomas & Co. and, accordingly, modified the judgment and decree of the trial Court and directed that it shall be executed against the defendant No. 1, the insurance company only. The aforesaid narration of facts clearly goes to show that the claim of the plaintiff against the two defendants, namely, the insurance company and the broker proceeded on two different grounds. Against the insurance company it proceeded on the basis of the policy of insurance under which, according to the plaintiff, the insurance company was liable to compensate the loss. Against the broker, namely, defendant No.2, the claim proceeded on the ground of its alleged failure to serve a notice on the carriers. Evidently, the grounds on which the decree appealed against proceeded were not common to all the defendants. That being so, the question that falls for determination is whether Order 41 Rule 4 will apply to the facts of the present case and whether the appeal filed by the present appellant shall be maintainable, From a reading of Order 41 Rule 4, it is clear that the object of this rule is to enable one of the parties to the suit to obtain relief in appeal when the decree appealed from proceeds on grounds common to him and others. The Court, in such case, may reverse or vary the decree in favour of all the parties who are in the same interest as the appellant. (Ratan Lai vs. Lalman Das, AIR 1970 SC 108 ). Order 41 Rule 4 provides an exception to the general rule that on an appeal by one of the several plaintiffs or defendants, the appellate court can reverse or vary only in favour of the party appealing. However, the condition precedent for application of this exception is that the decree appealed from proceeds on any ground common to all the plaintiffs or to all the defendants. Where the grounds are different and distinct the exception contained in Rule 4 shall have no application.
However, the condition precedent for application of this exception is that the decree appealed from proceeds on any ground common to all the plaintiffs or to all the defendants. Where the grounds are different and distinct the exception contained in Rule 4 shall have no application. In that view of the matter, I am of the opinion that Order 41 Rule 4 does not apply to the facts of the present case and as such, the non-appealing defendant, namely, the insurance company has no right to cone to the High Court and to file a second appeal, in effect, directly against the judgment of the trial Court. The next point for consideration is that even in case where the non-contesting defendant can file a second appeal, is it open to him to challenge the judgment of the trial Court on the grounds not raised before the first appellate Court by the contesting defendant. In my opinion, that cannot be done. The challenge in the second appeal before the High Court has to be confined only to the grounds raised before the first appellate Court as otherwise it would amount to giving a right to the n on-contesting defendant to prefer a second appeal directly before the High Court from the judgment of the trial Court. Such a course is not contemplated by Order 41 Rule 4. I am of the opinion that in such an appeal, the challenge to the judgment of the trial Court has to be confined only to the grounds on which it was challenged before the first appellate Court. No fresh ground, which was not considered by the first appellate Court, can be raised for the first time in the second appeal by a non-contesting defendant as that will amount to giving a premium to the non-contesting defendant over the contesting defendants which apparently could not have been the object of the legislature. In the light of the foregoing discussion, this appeal is not maintainable and, as such, it is dismissed. In the facts and circumstances of the case, I make no order as to costs.