URMILA DEVI & ORS. versus BRANCH MANAGER, NATIONAL INSURANCE COMPANY LTD. & ANR. on 30 January 2020

SUPREME COURT REPORTS

[2020] 3 S.C.R.

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URMILA DEVI & ORS.

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BRANCH MANAGER, NATIONAL INSURANCECOMPANY LTD. & ANR.

(Civil Appeal No. 838 of 2020)

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JANUARY 30, 2020

[S. A. BOBDE, CJI, B. R. GAVAI AND SURYA KANT, JJ.]

Motors Vehicles Act, 1988 – s.173 – Appeal – Cross objections– Maintainability of – Husband of claimant-appellant no.1 (whoCwas also father of appellant nos.2-4 & son of appellant no.5) metwith accident – MACT directed Insurance Company to payRs.2,47,500/- to the claimants – Appeal filed by Insurance Companybefore High Court was dismissed in default – Cross objection filedtherein by the appellants was dismissed as not maintainable – Held:DIn view of r.249 of 1992 Motor Vehicle Rules, the High Court rightlyheld that the claimants were entitled to file cross-objection – However,it restricted said right to file objection only when an appeal is filedby the insurance company challenging the quantum of compensationand not just its liability to pay compensation as in the present case– s.173 provides that any person aggrieved by an award of a ClaimsETribunal, subject to Sub-s.(2) thereof, may prefer an appeal to HighCourt – r.249(3) shows that save as provided in sub-rules (1) and(2), the provisions of Or.XLI and Or.XXI, CPC shall apply mutatismutandis to appeals preferred to the High Court u/s.173 – Conjointreading of s.173; r.249 and Or. XLI, r.22 reveals that there is noFrestriction on the right to appeal of any of the parties – Any partyaggrieved by any part of the award would be entitled to prefer anappeal – Thus, any respondent, though he may not have appealedfrom any part of the decree, apart from supporting the finding inhis favour, is also entitled to take any cross-objection to the decreewhich he could have taken by way of appeal – Further, r.22(4) ofGOr. XLI specifically provides that even if original appeal is withdrawnor dismissed for default, the cross-objection would nevertheless beheard and determined – Therefore, even if the appeal of theInsurance Company was dismissed in default and it was notinterested to revive the appeal, still the High Court was required toH

decide the cross-objection of appellants on merits – Impugnedjudgment set aside – Matter remitted to High Court for deciding thecross-objection on merits – Code of Civil Procedure, 1908 – Or.XLI, r.22; Or.XXI – Bihar Motor Vehicle Rules, 1992 – r.249 –Arbitration Act, 1940 – s.39.

Allowing the appeal, the Court

Conclusion

HELD: 1.1 In view of Rule 249 of the Bihar Motor VehicleRules, 1992, the High Court has rightly come to a conclusionthat the claimants would be entitled to file a cross-objection.However, it restricted the right of the claimants to file cross-objection only when an appeal is filed by the Insurance Companychallenging quantum of compensation. It held, that when theInsurance Company has not challenged the quantum ofcompensation but only challenges its liability to pay compensationon the ground that there is a breach of terms and condition bythe driver and/or the owner of the vehicle, the cross-objectionwould not be tenable at the instance of the claimants. Section173 of the M.V. Act provides, that any person aggrieved by anaward of a Claims Tribunal, subject to the provisions of sub-section(2) thereof, may prefer an appeal to the High Court. The restrictionimposed under Sub-s. (2) of Section 173 is with regard to non-filing of appeal against any award of a Claims Tribunal if the amountin dispute in the appeal is less than ten thousand rupees. Thesingle judge of the High Court himself observed that in view ofRule 249, Bihar Motor Vehicle Rules, 1992, there cannot be anyissue with regard to the tenability of the cross-objection. Sub-rule (3) of Rule 249 of the Bihar Motor Vehicle Rules, 1992 wouldshow, that save as provided in sub-rules (1) and (2), the provisionsof Order XLI and Order XXI in First Schedule to the CPC shallapply mutatis mutandis to appeals preferred to the High Courtunder Section 173 of the M.V. Act. A conjoint reading of theprovisions of Section 173 of the M.V. Act; Rule 249 of the BiharMotor Vehicle Rules, 1992; and Order XLI rule 22 of the CPCwould reveal, that there is no restriction on the right to appeal ofany of the parties. It is clear, that any party aggrieved by any partof the Award would be entitled to prefer an appeal. It is also clear,that any respondent, though he may not have appealed from anypart of the decree, apart from supporting the finding in his favour, A

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Ais also entitled to take any cross-objection to the decree whichhe could have taken by way of appeal. [Paras 15, 22-24][505-D-E; 511-E-G]

1.2 When in an appeal the appellant could have raised anyof the grounds against which he is aggrieved, the Court fails toBunderstand, as to how a respondent can be denied to file cross-objection in an appeal filed by the other side challenging thatpart of the Award with which he was aggrieved. The saiddistinction as sought to be drawn by the High Court is not in tunewith conjoint reading of the provisions of Section 173 of the M.V.Act; Rule 249 of the Bihar Motor Vehicle Rules, 1992; and OrderCXLI rule 22 of the CPC. It could be seen from the prayer clausein the appeal preferred by the respondents (Insurance Company)before the High Court that the entire award was challenged bythe respondents-Insurance Company. Not only that, but theappellants (the claimants) were also impleaded as partyDrespondents to the said appeal. In such circumstances, the HighCourt erred in declining to consider the cross-objection of theappellants herein (the claimants) on merits. Sub-rule (4) of Rule22 of Order XLI of the CPC specifically provides, that even if theoriginal appeal is withdrawn or is dismissed for default, the cross-objection would nevertheless be heard and determined after suchEnotice to the other parties as the Court thinks fit. Therefore,even if the appeal of the Insurance Company was dismissed indefault and the Insurance Company had submitted that they werenot interested to revive the appeal, still the High Court wasrequired to decide the cross-objection of the appellants herein Fon merits and in accordance with law. [Paras 25-27][512-C-G]

1.3 The impugned judgment and order is quashed and setaside. The matter is remitted back to the High Court for decidingthe cross-objection filed by the present appellants on its ownmerits. [Para 28][512-H; 513-A]

GMunicipal Corporation of Delhi & Ors. v. InternationalSecurity & Intelligence Agency Limited (2004) 3 SCC250 : [2003] 1 SCR 951; Bhadurmal v. BizaatunnisaBegum AIR 1964 AP 365; Inayatullah Khan v.

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Diwanchand Mahajan AIR 1959 MP 58; RamasraySingh & Ors. v. Bibhisan Sinha AIR 1950 Cal 372;Baru Ram v. Prasanni AIR 1959 SC 93 : [1959] SCR1403; Superintending Engineer & Ors. v. B. SubbaReddy (1999) 4 SCC 423 : [1999] 2 SCR 880 –referred to.

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Case Law Reference

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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 838 of2020.

From the Judgment and Order dated 21.01.2016 of the High Courtof Judicature at Patna in Miscellaneous Appeal No. 521 of 2011.

Shivam Singh, Rohit Kumar Singh, Harpreet Singh Gupta, GuruSharan Maurya, Animesh Kumar, Sumit Kumar, Rana Prashant, NeerajShekhar, Advs. for the Appellants.

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Ashok Kumar Sharma, Sr. Adv., Parmanand Gaur, Kshitij Mudgal,Ekansh Bansal, Akhil Sharma, Advs. for the Respondents.

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JUDGMENT

The following Judgment of the Court was delivered :

1. Leave granted.

2. Heard the learned counsels for the parties.

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3. The present appeal challenges the judgment and order dated21.01.2016 passed by the learned single judge of the High Court of Patnain Miscellaneous Appeal No.521 of 2011 thereby, holding the cross-objection of the claimant to be not maintainable.

4. The facts, bare necessary, for decision of the present appeal,are as under:

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A5. On 2.5.2008, Sanjay Tanti, husband of appellant No.1; fatherof appellant Nos. 2 to 4 and son of appellant No.5 met with an accidentwhile he was travelling from Ladma to Goradih by a Tata Maxi. Theappellants filed a Claim Petition under Section 166 of the Motor VehiclesAct, 1988 (hereinafter referred to as “the M.V. Act”). The owner of thevehicle was joined as Opponent No.1; the driver of the vehicle wasBjoined as Opponent No.2 whereas, the National Insurance CompanyLimited (hereinafter referred to as “the Insurance Company”) werejoined as Opponent Nos. 3 and 4.

6. The claim of the Insurance Company was that the driver andowner of the vehicle had breached the terms and conditions of theCinsurance policy and, as such, they are not liable for payment ofcompensation.

7. The Motor Vehicle Accidental Claim Tribunal (hereinafterreferred to as “the Tribunal”) vide judgment and order dated 29.1.2011,rejected the contention of the Insurance Company that the driver andDowner of the vehicle had breached the terms and conditions and whileallowing the Claim Petition directed the Insurance Company to paycompensation of Rs.2,47,500/- to the claimants in terms of the orderdated 29.1.2011.

8. Being aggrieved by the judgment and award passed by theElearned Tribunal, the Insurance Company preferred Misc. Appeal No.521of 2011 before the High Court at Patna contending therein, that thelearned Tribunal had erroneously fastened the liability on it. In the saidappeal, a cross-objection came to be filed by the appellants herein. Whenthe appeal came up for hearing, it was noticed that the appeal wasFdismissed for want of office objections and the counsel for the appellantstherein (Insurance Company) stated that the appellants (InsuranceCompany) were not interested in reviving the appeal. The appeal was,as such, disposed of by the High Court. Insofar as the cross-objection ofthe appellants herein (the claimants) is concerned, the High Court videthe impugned judgment and order dated 21.01.2016 held, that when theGappeal filed by the Insurance Company is only restricted to denial of itsliability to make the payment of compensation then in such case thecross-objection at the behest of the claimants in the shape of appealwould not be tenable. It, however, held that if the Insurance Company inthe appeal challenges the quantum of compensation, in such a case, theHclaimant(s) will have a right to file an objection in terms of Order XLI

rule 22 of the Code of Civil Procedure, 1908 (hereinafter referred to as“CPC”) and, as such, dismissed the cross-objection as not maintainable.

9. The High Court of Patna in view of Rule 249 of the BiharMotor Vehicles Rules, 1992 has held, that there is no impediment for theclaimant(s) to file cross-objection in an appeal filed by the InsuranceCompany if the Insurance Company had challenged the quantum ofcompensation awarded to the claimant. It, however, held that if the appealfiled by the Insurance Company is restricted only to its liability to makethe payment of compensation on the ground of breach of terms andconditions of the insurance policy by the vehicle owner and/or driver ofthe vehicle, then the cross-objection filed by the claimant would not betenable. It has been held, that in such a case the claimant(s) will have aright to file an appeal as provided under Section 173 of the M.V. Act.

10. Being aggrieved, the appellants are before us by way of presentappeal by special leave.

11. The learned counsel appearing on behalf of the appellantssubmit that the High Court has totally erred in holding that the cross-objection filed by the claimants was not maintainable since the appellant- Insurance Company has not challenged the quantum of compensation.

12. Per contra, the learned counsel for the Insurance Companysubmit, that the High Court has rightly rejected the cross-objection ofthe appellants herein. It is submitted that since the Insurance Companyhad not pressed the appeal, the cross-objection was rightly rejected bythe High Court.

13. The provisions of Section 173 of the M.V. Act and Order XLIrule 22 of the CPC, relevant for the present appeal, read thus:

Section 173 of the M.V. Act.

“173. Appeals. - (1) Subject to the provisions of sub-section (2)any person aggrieved by an award of a Claims Tribunal may,within ninety days from the date of the award, prefer an appeal tothe High Court:

Provided that no appeal by the person who is required to payany amount in terms of such award shall be entertained by theHigh Court unless he has deposited with it twenty-five thousandrupees or fifty percent of the amount so awarded, whichever isless, in the manner directed by the High Court:

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Provided further that the High Court may entertain the appealafter the expiry of the said period of ninety days, if it is satisfiedthat the appellant was prevented by sufficient cause frompreferring the appeal in time.

(2) No appeal shall lie against any award of a Claims Tribunal ifthe amount in dispute in the appeal is less than ten thousand rupees.”

Order XLI rule 22 of the CPC

“22. Upon hearing respondent may object to decree as ifhe had preferred separate appeal.—(1) Any respondent, thoughhe may not have appealed from any part of the decree, may notonly support the decree but may also state that the finding againsthim in the Court below in respect of any issue ought to have beenin his favour; and may also take any cross-objection to the decreewhich he could have taken by way of appeal, provided he hasfiled such objection in the Appellate Court within one month fromthe date of service on him or his pleader of notice of the day fixedfor hearing the appeal, or within such further time as the AppellateCourt may see fit to allow.

Explanation.—A respondent aggrieved by a finding of theCourt in the judgment on which the decree appealed against isbased may, under this rule, file cross-objection in respect of thedecree in so far as it is based on that finding, notwithstanding thatby reason of the decision of the Court on any other finding whichis sufficient for the decision of the suit, the decree, is, wholly or inpart, in favour of that respondent.

(2) Form of objection and provisions applicablethereto.—Such cross-objection shall be in the form of amemorandum, and the provisions of Rule 1, so far as they relateto the form and contents of the memorandum of appeal, shallapply thereto.

(3) * * *

(4) Where, in any case in which any respondent has under thisrule filed a memorandum of objection, the original appeal iswithdrawn or is dismissed for default, the objection so filed maynevertheless be heard and determined after such notice to theother parties as the Court thinks fit.

(5) The provisions relating to appeals by indigent persons shall, sofar as they can be made applicable, apply to an objection underthis rule.”

14. Rule 249 of the Bihar Motor Vehicle Rules, 1992 reads thus:

“249. Manner of appeals. - (1) Every appeal against the ClaimsTribunal shall be preferred in the form of a memorandum signedby the appellant or an advocate or attorney of the High Court dulyauthorised in that behalf by the applicant and presented to theHigh Court or to such officer as it appoints in this behalf. Thememorandum shall be accompanied by a copy of the award.

(2) The memorandum shall set forth concisely and under districtheads the grounds of objection to the award against which theappeal is preferred without any argument or narrative and suchgrounds shall be numbered consecutively.

(3) Save as provided in sub-rules (1) and (2), the provisions ofOrder XLI and Order XXI in First Schedule to the Code of CivilProcedure, 1908 (V of 1908) shall mutatis mutandis apply toappeals preferred to the High Court under Section 173.”

15. In view of the aforesaid provision, the High Court has rightlycome to a conclusion that the claimants would be entitled to file a cross-objection. However, it has restricted the right of the claimants to filecross-objection only when an appeal is filed by the Insurance Companychallenging quantum of compensation by placing reliance on previousjudgments of Patna High Court. It has been held, that when the InsuranceCompany has not challenged the quantum of compensation but onlychallenges its liability to pay compensation on the ground that there is abreach of terms and condition by the driver and/or the owner of thevehicle, the cross-objection would not be tenable at the instance of theclaimants.

16. An issue arose before the learned Three-Judge Bench of thisCourt in the case of Municipal Corporation of Delhi & Ors.vs.International Security & Intelligence Agency Limited1, as to whetherin an appeal under Section 39 of the Arbitration Act, 1940, a respondenthas a right to file cross-objection and, if so, whether the cross-objectionmust be heard and decided on merits though the appeal by reference towhich cross-objection has been filed is itself dismissed as not maintainable.1 (2004) 3 SCC 250

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17. This Court in the said judgment observed thus:

“14. Right of appeal is creature of statute. There is no inherentright of appeal. No appeal can be filed, heard or determined onmerits unless the statute confers right on the appellant and poweron the court to do so. Section 39 of the Act confers right to fileappeal, insofar as the orders passed under this Act are concerned,only against such of the orders as fall within one or other of thedescriptions given in clauses (i) to (vi) of sub-section (1) of Section39. Parliament has taken care to specifically exclude any otherappeal being filed, against any order passed under the Act but notcovered by clauses (i) to (vi) abovesaid, by inserting the expression“and from no others” in the text of sub-section (1). Clause (a) ofSection 41 extends applicability of all the provisions contained inthe Code of Civil Procedure, 1908 to (i) all proceedings beforethe court under the Act, and (ii) to all the appeals, under the Act.However, the applicability of such of the provisions of the Codeof Civil Procedure shall be excluded as may be inconsistent withthe provisions of the Act and/or of rules made thereunder. A barereading of these provisions shows that in all the appeals filed underSection 39, the provisions of the Code of Civil Procedure, 1908would be applicable. This would include the applicability of Order41 including the right to take any cross-objection under Rule 22thereof to appeals under Section 39 of the Act.

15. Right to prefer cross-objection partakes of the right to preferan appeal. When the impugned decree or order is partly in favourof one party and partly in favour of the other, one party may restcontented by his partial success with a view to giving a quietus tothe litigation. However, he may like to exercise his right of appealif he finds that the other party was not interested in burying thehatchet and proposed to keep the lis alive by pursuing the samebefore the appellate forum. He too may in such circumstancesexercise his right to file appeal by taking cross-objection. Thustaking any cross-objection to the decree or order impugned is theexercise of right of appeal though such right is exercised in theform of taking cross-objection. The substantive right is the rightof appeal; the form of cross-objection is a matter of procedure.

16. Though the statement of law made hereinabove flows simplyby the reading of the relevant statutory provisions yet some available decisions may also be noticed. In Bhadurmal v.Bizaatunnisa Begum [AIR 1964 AP 365 : (1964) 1 An WR 290]a Division Bench presided over by Jaganmohan Reddy, J. (as HisLordship then was) held cross-objection to be maintainable in anappeal preferred under Sections 47 to 49 of the HyderabadJagirdars Debt Settlement Act, 1952 because the provisions ofthe Civil Procedure Code were generally applicable by virtue ofSection 51 thereof. The applicability of Order 41 Rule 22 to theappeals under that Act was held not excluded merely becauseprovisions governing grounds of appeal and court fees werespecifically enacted in the Hyderabad Act. In InayatullahKhan v. Diwanchand Mahajan [AIR 1959 MP 58 : 1958 MPLJ 786] Chief Justice M. Hidayatullah (as His Lordship then was)upheld maintainability of the cross-objection in an election appealunder Section 116-A of the Representation of the People Act,1951 because the High Court as an appellate court hearing anappeal under Section 116-A was enjoined to exercise the samepowers, jurisdiction and authority and to follow the same procedureas it would have exercised or followed in respect of a civil appealunder the Code of Civil Procedure. In Ramasray Singh v.Bibhisan Sinha [AIR 1950 Cal 372] the Division Bench consistingof Harries, C.J. and Bachawat, J. (as His Lordship then was)held that conferment of right of appeal by Section 38 of the BengalMoney-Lenders Act, 1940 which spoke of the order beingappealable in the same manner as if it were a decree of the courtimplied a right in the respondent to file cross-objection inasmuchas the jurisdiction to hear appeal was conferred on a pre-establishedcivil court, namely, the Court of the District Judge and nothingwas expressly stated as to the procedure regulating such appeal.In A.L.A. Alagappa Chettiar v. Chockalingam Chetty [AIR1919 Mad 784 : ILR 41 Mad 904 (FB)] a Full Bench of the HighCourt of Madras presided over by Wallis, C.J. held that right ofthe respondent to proceed by way of memorandum of cross-objections was strictly incidental to the filing of appeal by oppositeparty and therefore in an appeal under Sections 46 and 47 of theProvincial Insolvency Act, 1907, cross-objections weremaintainable as the procedure prescribed in the Civil ProcedureCode is the standard procedure and applicable to courts exercisingpowers in insolvency cases.

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17. With advantage, we may also refer to observations of thisCourt made in Baru Ram v. Prasanni [AIR 1959 SC 93 : 1959SCR 1403] . Section 116-A of the Representation of the PeopleAct, 1951 contemplates an appeal being laid before the SupremeCourt from every order made by the High Court under Section 98or Section 99 of that Act. Section 116-C provides for every suchappeal being heard and determined by the Supreme Court as nearlyas may be in accordance with the procedure applicable to thehearing and determination of any appeal from any final orderpassed by the High Court in exercise of its original civil jurisdictionsubject to the provisions of that Act and the Rules, if any. All theprovisions of the Code of Civil Procedure, 1908 and rules of thecourt shall, so far as may be, apply in relation to such appeal. P.B.Gajendragadkar, J. (as His Lordship then was) speaking for theCourt observed: (AIR p. 99, para 11)

“There is no doubt that, in an ordinary civil appeal, therespondent would be entitled to support the decree under appealon grounds other than those found by the trial court in his favour.Order 41 Rule 22 of the Code of Civil Procedure which permitsthe respondent to file cross-objections recognize therespondent’s right to support the decree on any of the groundsdecided against him by the court below. In the present case no

appeal could have been preferred by Respondent 1 becauseshe had succeeded in obtaining the declaration that theappellant’s election was void and it should therefore be opento her to support the final conclusion of the High Court bycontending that the other finding recorded by the High Courtwhich would go to the root of the matter is erroneous. Primafacie there appears to be some force in this contention;”

However, the Court did not express any final opinion thereon as itwas considered not necessary to decide the point in that appeal.

18. We have, therefore, no doubt in our mind that right to take across-objection is the exercise of substantive right of appealconferred by a statute. Available grounds of challenge against thejudgment, decree or order impugned remain the same whether itis an appeal or a cross-objection. The difference lies in the formand manner of exercising the right; the terminus a quo (the startingpoint) of limitation also differs.

19. In Superintending Engineer v. B. Subba Reddy [(1999) 4SCC 423] a two-Judge Bench of this Court observed (vide SCCp. 434, para 24):

“If there is no right of cross-objection given under Section 39of the Act, it cannot be read into Section 41 of the Act. Filingof cross-objection is not procedural in nature. Section 41 ofthe Act merely prescribes that the procedure of the Code wouldbe applicable to the appeal under Section 39 of the Act. Weare, therefore, of the opinion that cross-objection by therespondent was not maintainable….”

Such observation is not correct and proceeds on certain wrongpremises. Firstly, form of cross-objection is procedural and is onlya manner of exercising right of appeal which is substantive, as wehave already stated. Secondly, it is not merely the procedureprescribed by the Code of Civil Procedure which has been madeapplicable to proceedings under the Arbitration Act by Section41(a) of the Act; the entire body of the Code of Civil Procedure,1908 has been made applicable to all proceedings before the courtand to all appeals under the Arbitration Act, 1940. The provisionis general and wide in its applicability which cannot be curtailed;the only exception being where the provisions of the ArbitrationAct and/or of the rules made thereunder may be inconsistent withthe provisions of the Code of Civil Procedure, 1908 in which casethe applicability of the latter shall stand excluded but only to theextent of inconsistency. We may hasten to add that to the extentof our disagreement with the law laid down in B. Subba Reddycase [(1999) 4 SCC 423] the proposition appears to have beenrather widely stated in that case. In fact the question before theCourt in B. Subba Reddy case [(1999) 4 SCC 423] was whethercross-objection seeking the relief of award of interest at a higherrate was maintainable though such an order did not fall within thepurview of Section 39(1) of the Act.

20. Once we hold that by taking cross-objection what is beingexercised is the right of appeal itself, it follows that the subject-matter of cross-objection and the relief sought therein mustconform to the requirement of Section 39(1). In other words, across-objection can be preferred if the applicant could have soughtfor the same relief by filing an appeal in conformity with the AB

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Aprovisions of Section 39(1) of the Act. If the subject-matter of thecross-objection is to impugn such an order which does not fallwithin the purview of any of the categories contemplated by clauses(i) to (vi) of sub-section (1) of Section 39 of the Act, the cross-objection shall not be maintainable.”

B18. It, thus, could be seen, that this Court has held that the right toprefer cross-objection partakes of the right to prefer an appeal. It hasbeen held, that when the impugned decree or order is partly in favour ofone party and partly in favour of the other, one party may rest contentedby his partial success with a view to giving a quietus to the litigation. It,however, held that if he finds that the other party was not interested inCgiving an end to the litigation and proposed to keep the lis alive by pursuingthe same before the appellate forum, he may like to exercise his right ofappeal. It has been held, that he too may in such cases and circumstancesexercise his right to file appeal by taking cross objection. It has beennext held, that taking any cross-objection to the decree or order impugnedDis the exercise of right of appeal though such right is exercised in theform of taking cross-objection. It has been held, that the substantiveright is the right of appeal and the form of cross objection is a matter ofprocedure.

19. While arriving at the said decision, this Court relied on theEjudgment in the case of Bhadurmal vs. Bizaatunnisa Begum[2], whereinan issue with regard to maintainability of cross-objection in an appealpreferred under Sections 47 to 49 of Hyderabad Jagirdars DebtSettlement Act, 1952 was considered. It also relied on the judgment inthe case of Inayatullah Khan vs. Diwanchand Mahajan[3], whereinmaintainability of cross objection in an election appeal under SectionF116A of the Representation of the People Act, 1951 was upheld. It furtherrelied on the judgment of the Calcutta High Court in the case of RamasraySingh & Ors. vs. Bibhisan Sinha[4], upholding the right of the respondentto file cross-objection in an appeal contemplated under Section 38 ofBengal Money-Lenders Act, 1940.G20. It further relied on certain observations of this Court in thecase of Baru Ram vs. Prasanni[5]. This Court did not agree with the 2 AIR 1964 AP 365

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4 AIR 1950 Cal 372H5 AIR 1959 SC 93 : 1959 SCR 1403

contrary view taken by the learned two-judge Bench of this Court in thecase of Superintending Engineer & Ors. vs. B. Subba Reddy[6].However, holding so, this Court held that since the right to appeal underSection 39 of the Arbitration Act, 1940 was only restricted to clauses (i)to (vi) of sub-section (1) thereof, the cross-objection also must conformto the said requirement. In other words, it was held that a cross-objectionwould be maintainable only if the subject-matter thereof falls in any ofthe category carved out under clauses (i) to (vi) of sub-section (1) ofSection 39 of the Arbitration Act, 1940.

21. This Court further found that the entire Order XLI rule 22CPC would apply to a cross-objection including the provisions of sub-rule (4) thereof. It was held, that if the original appeal is found to beincompetent or not maintainable if it is filed against an order not fallingunder any of the clauses (i) to (vi) of sub-Section (1) of Section 39, thenthe cross objection shall also fail on that ground and cannot be adjudicatedupon on merits. It could, thus, be seen that the view taken by the Courtis that the cross-objection would be tenable only if appeal is validlytenable.

22. A perusal of Section 173 of the M.V. Act would reveal thatthe said provision does not restrict the right to file an appeal as is restrictedunder Section 39 of the Arbitration Act, 1940. It provides, that any personaggrieved by an award of a Claims Tribunal, subject to the provisions ofsub-section (2) thereof, may prefer an appeal to the High Court. Therestriction imposed under sub-section (2) of Section 173 is with regardto non-filing of appeal against any award of a Claims Tribunal if theamount in dispute in the appeal is less than ten thousand rupees. Needlessto mention that this is subject to the provisions about limitation.

23. As already discussed herein above, the learned single judge ofthe High Court himself has observed that in view of Rule 249 of theBihar Motor Vehicle Rules, 1992, there cannot be any issue with regardto the tenability of the cross-objection. Sub-rule (3) of Rule 249 of theBihar Motor Vehicle Rules, 1992 would show, that save as provided insub-rules (1) and (2), the provisions of Order XLI and Order XXI inFirst Schedule to the CPC shall apply mutatis mutandis to appealspreferred to the High Court under Section 173 of the M.V. Act.

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A24. A conjoint reading of the provisions of Section 173 of theM.V. Act; Rule 249 of the Bihar Motor Vehicle Rules, 1992; and OrderXLI rule 22 of the CPC would reveal, that there is no restriction on theright to appeal of any of the parties. It is clear, that any party aggrievedby any part of the Award would be entitled to prefer an appeal. It is alsoclear, that any respondent, though he may not have appealed from anyBpart of the decree, apart from supporting the finding in his favour, is alsoentitled to take any cross-objection to the decree which he could havetaken by way of appeal.

25. When in an appeal the appellant could have raised any of thegrounds against which he is aggrieved, we fail to understand, as to howCa respondent can be denied to file cross-objection in an appeal filed bythe other side challenging that part of the Award with which he wasaggrieved. We find, that the said distinction as sought to be drawn by theHigh Court is not in tune with conjoint reading of the provisions of Section173 of the M.V. Act; Rule 249 of the Bihar Motor Vehicle Rules, 1992;Dand Order XLI rule 22 of the CPC.

26. As a matter of fact, it could be seen from the prayer clause inthe appeal preferred by the respondents herein (Insurance Company)before the High Court that the entire award was challenged by therespondents – Insurance Company. Not only that, but the appellantsEherein (the claimants) were also impleaded as party respondents to thesaid appeal. In such circumstances, the High Court has erred in decliningto consider the cross-objection of the appellants herein (the claimants)on merits.

27. There is another angle to it. Sub-rule (4) of Rule 22 of OrderFXLI of the CPC specifically provides, that even if the original appeal iswithdrawn or is dismissed for default, the cross-objection wouldnevertheless be heard and determined after such notice to the otherparties as the Court thinks fit. We are, therefore, of the considered view,that even if the appeal of the Insurance Company was dismissed indefault and the Insurance Company had submitted that they were notGinterested to revive the appeal, still the High Court was required to decidethe cross-objection of the appellants herein on merits and in accordancewith law.

28. In the result, the appeal is allowed. The impugned judgmentand order dated 21.1.2016 holding that the cross-objection of the presentHappellants was not maintainable is quashed and set aside. The matter is remitted back to the High Court for deciding the cross-objection filed bythe present appellants on its own merits. There shall be no order as tocosts.

Divya Pandey

Appeal allowed.

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