NARAYAN SITARAMJI BADWAIK (DEAD) THROUGH LRS versus BISARAM AND OTHERS on 17 February 2021

NARAYAN SITARAMJI BADWAIK (DEAD) THROUGH LRS.v.

BISARAM AND OTHERS

(Civil Appeal No. 6124 of 2011)

FEBRUARY 17, 2021

[N.V. RAMANA, SURYA KANT AND

ANIRUDDHA BOSE, JJ.]

Code of Civil Procedure, 1908 – s. 100 and s.103 – SecondAppeal – Appellant had filed suit for possession of the property indispute on the basis of a sale deed dated 26.09.1978 – Respondentcontended that no such sale took place – The Trial Court, afterlooking into the evidence had dismissed the suit of the appellant –The First Appellate Court (District Judge) reversed the findings ofthe Trial Court and decreed the suit in favour of the appellant –The High Court in the second appeal upheld the findings of theTrial Court and dismissed the suit of the appellant – On appeal,held: The High Court had noted that the First Appellate Court hadconsidered irrelevant material and had erred in appreciating thelegal issue involved – After highlighting the legal infirmities of thejudgment of the First Appellate Court, and answering the substantialquestion of law framed in favour of the respondents, it appearsthat the High Court did not note that the First Appellate Court, dueto its erroneous approach, had failed to consider the evidence inthe correct light – In such a circumstance, it would have beenappropriate for the High Court to remand the matter to the FirstAppellate Court to determine the factual issues in light of the legalpoint as decided by it, or should have itself taken a decision on thefacts u/s. 103 of the Civil Procedure Code – Instead, afternegativing the observations and holding of the First AppellateCourt, the High Court mechanically upheld the decision renderedby the Trial Court – High Court decided the appeal without anyassessment of the evidence on record – Accordingly, the order ofthe High Court is set aside and the matter is remanded to the HighCourt for fresh consideration of the appeal, on facts and law.

Municipal Committee, Hoshiarpur v. Punjab StateElectricity Board, (2010) 13 SCC 216 : [2010] 13 SCR658 – relied on.

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702SUPREME COURT REPORTS

[2021] 1 S.C.R.

ASantosh Hazari v. Purushottam Tiwari (deceased) byLRs, (2001) 3 SCC 179 : [2001] 1 SCR 948 – referredto.

CIVIL APPELLATE JURISDICTION : Civil Appeal No.6124of 2011.

BFrom the Judgment and Order dated 15.10.2009 of the High Courtof Judicature at Bombay, Nagpur Bench in Second Appeal No.358 of1997.

Mrs. B. Sunita Rao, Adv. for the Appellants.

CThe Judgment of the Court was delivered byN. V. RAMANA, J.1. When the matter came up last time, on 03.02.2021, this Courtpassed the following order:

“In spite of service, no one has appeared on behalf of theDrespondents.

Heard learned counsel for the appellants.

Taking into consideration the non-appearance of the counsel forthe respondents and to know the exact position of the disputedEproperty as well as whether any compromise has taken placebetween the parties, we grant two weeks to the counsel for theappellants to do the needful.

List the matter immediately after two weeks.”

2. Even today, when the matter was called out, nobody appearedFfor the respondents in spite of service of notice.

3. Heard the learned counsel appearing for the appellants.

4. In response to our earlier query, it is represented by the learnedcounsel for the appellants that no settlement has taken place betweenthe parties, and according to her the parties intend to continue with theGlitigation.

5. Taking into account the long pendency of the present appealbefore this Court, and the fact that, despite service of notice, therespondents have not entered appearance from the very beginning as H

per the Office Reports, we are of the opinion that we should dispose ofthe matter with the assistance of the counsel for the appellants.

6. The facts of the case necessary for the disposal of the presentappeal are as follows: the Narayan Sitaramji Badwaik (since deceasedand now represented through his legal representatives and who shallhereinafter for the sake of convenience be referred to as the appellant)had filed a suit for possession of the property in dispute, on the basis ofa sale deed dated 26.09.1978, for Rs.10,000 from some of the respondents.On the other hand, the respondents contend that no such sale took place,and in fact, the document executed was only collateral for a loan extendedby the appellant to respondents. The appellant sought possession of theproperty on 05.09.1987, and subsequently instituted the present suit on07.03.1989. The Trial Court, after looking into the evidence placed onrecord, dismissed the suit of the appellant vide judgment dated 21.09.1995.On appeal, the District Judge reversed the findings of the Trial Courtand decreed the suit in favour of the appellant vide judgment dated05.08.1997. Aggrieved by the judgment of the First Appellate Court,some of the respondents filed a second appeal before the High Courtwherein the High Court upheld the findings of the Trial Court and allowedthe second appeal vide the impugned judgment, thereby dismissing thesuit of the appellant.

7. We have carefully perused the impugned judgment by the HighCourt with the assistance of the counsel for the appellant.

8. The High Court, vide the impugned judgment, noted that theFirst Appellate Court had considered irrelevant material and had erredin appreciating the legal issue involved. The High Court held as follows:

“8. I may mention that it is neither party’s case that the transactionis void or voidable. It is defendants’ simplecase that although theyhad executed a sale-deed, it was nominal and was not to be actedupon as sale-deed was executed as a collateral security. Onedoes not understand why the learned joint District Judge consideredthe question as to whether the transaction between the plaintiffand the defendants is void or voidable. The contract becomesvoid when it is opposed to public policy and voidable when it isbrought about by fraud, undue influence, coercion or fraud. Asstated earlier, it is neither party’s case that the documentwas brought about by fraud, undue influence, coercion or AB

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Amisrepresentation. There was, therefore, no question ofconsidering this aspect at all. It seems that the learnedDistrict Judge instead of considering the provisions ofSection 91 and 92 of the Evidence Act, considered a totally”irrelevant aspect…

(emphasis supplied)

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9. However, after highlighting the legal infirmities of the judgmentof the First Appellate Court, and answering the substantial question oflaw framed in favour of the respondents, it appears that the High Courtdid not note that the First Appellate Court, due to its erroneous approach,Chad failed to consider the evidence in the correct light. In such acircumstance, it would have been appropriate for the High Court toremand the matter to the First Appellate Court to determine the factualissues in light of the legal point as decided by it, or should have itselftaken a decision on the facts under Section 103 of the Civil ProcedureCode.D

10. It is a settled position of law that a second appeal, under Section100 of the Code of Civil Procedure, lies only on a substantial question oflaw [refer Santosh Hazari v. Purushottam Tiwari (deceased) by LRs,(2001) 3 SCC 179]. However, this does not mean that the High Courtcannot, in any circumstance, decide findings of fact or interfere withEthose arrived at by the Courts below in a second appeal. In fact, Section103 of the Code of Civil Procedure explicitly provides for circumstancesunder which the High Court may do so. Section 103 of the Code of CivilProcedure is as follows:

Section 103. Power of High Court to Determine Issue ofFFact In any second appeal, the High Court may, if the evidence on therecord is sufficient, determine any issue necessary for the disposalof the appeal,- (a) which has not been determined by the lower Appellate CourtGor both by the Court of first instance and the lower AppellateCourt, or (b) which has been wrongly determined by such Court or Courtsby reason of a decision on such question of law as is referred to insection 100.H

11. A bare perusal of this section clearly indicates that it providesfor the High Court to decide an issue of fact, provided there is sufficientevidence on record before it, in two circumstances. First, when an issuenecessary for the disposal of the appeal has not been determined by thelower Appellate Court or by both the Courts below. And second, whenan issue of fact has been wrongly determined by the Court(s) below byvirtue of the decision on the question of law under Section 100 of theCode of Civil Procedure. This Court, in the case of MunicipalCommittee, Hoshiarpur v. Punjab State Electricity Board, (2010)13 SCC 216, held as follows:

“26. Thus, it is evident that Section 103 CPC is not an exceptionto Section 100 CPC nor is it meant to supplant it, rather it is toserve the same purpose. Even while pressing Section 103 CPC inservice, the High Court has to record a finding that it had toexercise such power, because it found that finding(s) of factrecorded by the court(s) below stood vitiated because of perversity.More so, such power can be exercised only in exceptionalcircumstances and with circumspection, where the core questioninvolved in the case has not been decided by the court(s) below.

27. There is no prohibition on entertaining a second appealeven on a question of fact provided the court is satisfiedthat the findings of fact recorded by the courts below stood-vitiated by nonconsideration of relevant evidence or by showing an erroneous approach to the matteri.e. that thefindings of fact are found to be perverse. But the High Courtcannot interfere with the concurrent findings of fact in a routineand casual manner by substituting its subjective satisfaction inplace of that of the lower courts. (Vide Jagdish Singh v. NatthuSingh [(1992) 1 SCC 647]; Karnataka Board of Wakf v.Anjuman-E-Ismail Madris-Un-Niswan [(1999) 6 SCC 343]and Dinesh Kumar v. Yusuf Ali [(2010) 12 SCC 740].)

28. If a finding of fact is arrived at by ignoring or excludingrelevant material or by taking into consideration irrelevantmaterial or if the finding so outrageously defies logic as tosuffer from the vice of irrationality incurring the blame ofbeing perverse, then the finding is rendered infirm in theeye of the law. If the findings of the Court are based on noevidence or evidence which is thoroughly unreliable or evidence A

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Athat suffers from the vice of procedural irregularity or the findingsare such that no reasonable person would have arrived at thosefindings, then the findings may be said to be perverse. Further ifthe findings are either ipse dixit of the Court or based on conjectureand surmises, the judgment suffers from the additional infirmityof non-application of mind and thus, stands vitiated. (Vide BharathaBMatha v. R. Vijaya Renganathan [(2010) 11 SCC 483]”

(emphasis supplied)

12. With respect to the present case, it is clear from the observationspassed by the High Court in the impugned judgment that the First AppellateCCourt approached the matter incorrectly. As such, the High Court oughtto have either remanded the matter, or exercised its powers under Section103, Code of Civil Procedure and decided the issues of fact. Instead,after negativing the observations and holding of the First Appellate Court,the High Court mechanically upheld the decision rendered by the TrialCourt in the following terms:D

“11. This decision makes it clear that a party has a right to showthat the document was not intended to be acted upon and what iswritten in it is of no consequence. The Learned judge of the trialcourt has rightly held that the defendants had actually shown thatthe sale-deeds were nominal and they were not to be acted uponEand therefore, the plaintiff was not entitled to possession. TheLearned District Judge fell in error in setting aside the finding ofthe trial court that the sale-deed in favour of the plaintiff was anominal on the ground that the defendant ought to have got thesale-deeds set aside. The Learned Civil Judge has rightlyconsidered the evidence and has held the sale-deed to be nominalFand having been executed by way of collateral security. The findingof the Learned District Judge that the suit was not maintainableunless sale-deed was got set aside by defendants, therefore, wasnot proper. The substantial question of law is answered accordingly.The appeal is, therefore, allowed and judgment and decree passedGby the first appellate court is set aside and that of the trial courtrestored.”

13. A perusal of the above clearly indicates that the High Courtdecided the appeal without any assessment of the evidence on record, ina single paragraph. In the circumstances highlighted, we are of the opinionHthat this was not appropriate.

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NARAYAN SITARAMJI BADWAIK (DEAD) THROUGH LRS. v.BISARAM AND OTHERS [N. V. RAMANA, J.]

14. In view of the above, we are of the considered view that theimpugned order of the High Court is liable to be set aside, and the matterbe remanded.

15. We, accordingly set aside the order of the High Court andremand the matter to the said Court for fresh consideration of the appeal,on facts and law, if necessary. We also leave it open to the High Court toBmodify the question of law framed, or frame additional questions of lawafter giving an opportunity to the parties. It is clarified that we have notmade any observations as to the merits of the case, or the correctnessof holding of the High Court on the legal issue.

16. Taking into consideration the long pendency of the litigation,we request the High Court to dispose of the matter within a period of sixmonths from the date of communication of this order.

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17. The Appeal is disposed of in the afore-stated terms.

Ankit Gyan

Appeal disposed of.

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