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Reportable

IN THE SUPREME COURT OF INDIA CIVIL APPELALTE JURISDICTION

CIVIL APPEAL NO. 9681 OF 2014 (ARISING OUT OF SLP(C) NO.26124/2013)

Vinod Kumar            Appellant(s)

VERSUS

Gangadhar Respondent(s)                   

J U D G M E N T

Abhay Manohar Sapre, J.

1) We have perused the Office Report dated 10.10.2014. It  

discloses  that  despite  last  opportunity  granted  to  the  

respondent,  he  has  not  filed  any counter  affidavit  till  date.  

Today, when the matter was taken up for hearing, there was  

no representation for the respondent. Therefore, we proceed to  

decide the appeal on merits.

2) Leave granted.  

3) This  is  a  civil  appeal  filed  by  the  plaintiff  against  the  

judgment/decree  dated  21.03.2013  passed  by  the  single  

Judge of the High Court of M. P., Indore Bench in First Appeal  

No. 173 of 1999, which in turn arises out of the judgment and  

decree  dated  27.02.1999  passed  by  the  second  Additional  

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District Judge, Mandsaur in Civil Suit No. 36A/97.   

4) In  order  to  appreciate  the  short  issue involved in  this  

appeal, it is necessary to state a few relevant facts:

5) The appellant (plaintiff) filed a civil suit in the Court of  

second Additional  District Judge,  Mandsore being Civil  Suit  

no.  36A/97  against  the  respondent  (defendant)  for  specific  

performance of the contract for purchase of house bearing no.  

9, situated at Madhavganj Mandsaur (herein after referred to  

as  "the  suit  house”).  According  to  the  appellant,  the  

respondent was the owner of the suit house and he entered  

into a written agreement dated 05.01.1992 with the appellant  

to  sell  the  suit  house  to  the  appellant  for  a  total  sum  of  

Rs.1,48,000/-. It was alleged in the plaint that the appellant,  

in terms of the agreement, offered/tendered Rs.9,989/- to the  

respondent towards part payment of  the sale consideration,  

but he declined to accept the amount and avoided        to  

perform his part of the agreement. This led to the serving of  

notice by the appellant to the respondent calling upon him to  

perform his part of the agreement and execute the sale deed of  

the suit house in the appellant’s favour. Since the respondent  

failed to ensure compliance of the legal notice, the appellant  

filed  the  aforementioned  civil  suit  against  the  respondent  

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seeking specific performance of the agreement in question. It  

was  alleged  that  the  appellant  was  ready  and  willing  to  

perform his part of the agreement but it was respondent who  

failed to perform his part and hence this suit.

6) The  respondent  filed  the  written  statement  denying  

allegations made in the plaint. According to the respondent,  

there was no concluded agreement between the parties and in  

any  event,  the  appellant  having  failed  to  perform  his  

obligations, which were agreed upon in the alleged agreement,  

he was not entitled to seek enforcement of  such agreement  

against the respondent in relation to the suit house.

7) Thereafter, the trial Court framed the issues. Parties then  

adduced evidence in support of their pleadings. The trial Court  

vide its judgment/decree dismissed the suit and declined to  

grant any relief  to the appellant.  Feeling aggrieved with the  

said judgment/decree, the appellant filed First Appeal No. 173  

of 1999 under Section 96 of the Code of Civil Procedure, 1908  

in the High Court of M.P. at Indore Bench.  

8) The  learned  Single  Judge,  by  impugned  judgment,  

dismissed  the  first  appeal  filed  by  the  appellant  and  in  

consequence  confirmed the  judgment/decree  passed  by  the  

trial  court,  which had dismissed  appellant's  civil  suit.  It  is  

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against this confirmation of the dismissal of the suit by the  

High Court, the appellant felt aggrieved and filed this appeal.  

9) Learned  Counsel  for  the  appellant  while  assailing  the  

legality and correctness of the impugned judgment contended  

that the High Court without adverting to all the factual details  

and various grounds raised in the first appeal, disposed of the  

same in a cryptic manner. According to learned counsel, the  

High Court neither dealt with any issue nor appreciated the  

ocular and documentary evidence adduced by the parties nor  

examined the legal principles applicable to the issues arising  

in the case and nor rendered its findings on any contentious  

issues  on  which the  appellant  was  non  suited  by  the  trial  

court though urged by the appellant in support of the appeal.  

Learned counsel further contended that it was the duty of the  

High Court being the first appellate court and exercising its  

appellate powers under Section 96 read with Order 41 Rule 31  

ibid to have dealt with the submissions which were urged by  

the appellant after appreciating the entire evidence on facts,  

independent to the findings of the trial Court and should have  

come to its own conclusion keeping in view the legal principles  

governing the issues and since it was not done by the High  

Court,  the  impugned  judgment  is  not  legally  sustainable.  

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Lastly, the learned counsel urged that in case his arguments  

are accepted,  the remand of  the case to the High Court  to  

decide the appeal on merits afresh is inevitable.

10) Having heard the learned counsel for the appellant and  

on perusal  of  the record of  the case and on examining the  

issue arising in the appeal, we find force in the submission of  

the learned counsel for the appellant.  

11) The powers of the first appellate court while deciding the  

first appeal under Section 96 read with Order 41 Rule 31 of  

the Code of Civil Procedure, 1908 are indeed well defined by  

various  judicial  pronouncements  of  this  Court  and  are,  

therefore, no more res integra.  

12) As far back in 1969, the learned Judge – V.R. Krishna  

Iyer,  J (as His Lordship then was the judge of  Kerala High  

Court) while deciding the first appeal under Section 96 of the  

CPC in Kurian Chacko vs. Varkey Ouseph, AIR  1969 Kerala  

316, reminded the first appellate court of its duty as to how  

the first appeal under Section 96 should be decided. In his  

distinctive style of writing and subtle power of expression, the  

learned judge held as under:  

“1. The plaintiff, unsuccessful in two Courts, has come  up here aggrieved by the dismissal of his suit which was one  for  declaration  of  title  and  recovery  of  possession.  The  defendant disputed the plaintiff's title to the property as also  

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his  possession  and  claimed  both  in  himself.  The  learned  Munsif,  who  tried  the  suit,  recorded  findings  against  the  plaintiff  both on title  and possession.  But,  in appeal,  the  learned  Subordinate  Judge  disposed  of  the  whole  matter  glibly and briefly, in a few sentences. 2. An appellate court is the final Court of fact ordinarily and  therefore  a  litigant  is  entitled  to  a  full  and  fair  and  independent consideration of the evidence at the appellate  stage. Anything less than this is unjust to him and I have no  doubt  that  in  the  present  case  the  learned  Subordinate  Judge has fallen far short of what is expected of him as an  appellate Court.  Although there is furious contest between  the counsel for the appellant and for the respondent, they  appear to agree with me in this observation…..”

            (Emphasis supplied) 13) This Court in number of cases while affirming and then  

reiterating the aforesaid principle  has laid down the scope  

and powers of the first appellate court under Section 96 ibid.

14) We consider it apposite to refer to some of the decisions   

15) In  Santosh Hazari vs. Purushottam Tiwari (Deceased)  

by L.Rs. (2001) 3 SCC 179, this Court held (at pages 188-189) as  

under:

“.……..the  appellate  court  has  jurisdiction  to  reverse  or  affirm  the  findings  of  the  trial  court.  First  appeal  is  a  valuable right of the parties and unless restricted by law, the  whole case is therein open for rehearing both on questions of  fact  and  law.  The  judgment  of  the  appellate  court  must,  therefore,  reflect  its  conscious  application  of  mind  and  record  findings  supported  by  reasons,  on  all  the  issues  arising along with the contentions put forth, and pressed by  the  parties  for  decision  of  the  appellate  court……while  reversing a finding of fact the appellate court must come into  close quarters with the reasoning assigned by the trial court  and then assign its own reasons for arriving at a different  finding. This would satisfy the court hearing a further appeal  that  the  first  appellate  court  had  discharged  the  duty  expected of it…………”  

16) The  above  view  has  been  followed  by  a  three-Judge  

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Bench  decision  of  this  Court  in  Madhukar  &  Ors. v.  

Sangram & Ors.,(2001) 4 SCC 756, wherein it was reiterated  

that sitting as a court of first appeal, it is the duty of the High  

Court to deal with all the issues and the evidence led by the  

parties before recording its findings.

17) In H.K.N. Swami v. Irshad Basith,(2005) 10 SCC 243,  

this Court (at p. 244) stated as under: (SCC para 3)

“3. The first appeal has to be decided on facts as well as  on law. In the first appeal parties have the right to be heard  both  on  questions  of  law  as  also  on  facts  and  the  first  appellate court is required to address itself to all issues and  decide the case by giving reasons. Unfortunately, the High  Court,  in  the  present  case  has  not  recorded  any  finding  either on facts or on law. Sitting as the first appellate court it  was the duty of the High Court to deal with all the issues  and  the  evidence  led  by  the  parties  before  recording  the  finding regarding title.”

18) Again in Jagannath v. Arulappa & Anr., (2005) 12 SCC  

303, while considering the scope of Section 96 of the Code of  

Civil Procedure, 1908, this Court (at pp. 303-04) observed as  

follows: (SCC para 2)

“2.  A  court  of  first  appeal  can  reappreciate  the  entire  evidence and come to a different conclusion……...”

19) Again  in  B.V  Nagesh  &  Anr. vs.  H.V.  Sreenivasa  

Murthy, (2010) 13 SCC 530, this court taking note of all the  

earlier judgments of this court reiterated the aforementioned  

principle with these words:

“3. How the regular first appeal is to be disposed of by the  

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appellate  court/High  Court  has  been  considered  by  this  Court in various decisions. Order 41 CPC deals with appeals  from  original  decrees.  Among  the  various  rules,  Rule  31  mandates  that  the  judgment  of  the  appellate  court  shall  state:

(a) the points for determination; (b) the decision thereon; (c) the reasons for the decision; and (d) where the decree appealed from is reversed or varied,  

the relief to which the appellant is entitled. 4. The appellate court has jurisdiction to reverse or affirm  

the findings of the trial court. The first appeal is a valuable  right of the parties and unless restricted by law, the whole  case is therein open for rehearing both on questions of fact  and  law.  The  judgment  of  the  appellate  court  must,  therefore,  reflect  its  conscious  application  of  mind  and  record  findings  supported  by  reasons,  on  all  the  issues  arising along with the contentions put forth, and pressed by  the parties for decision of the appellate court. Sitting as a  court of first appeal, it was the duty of the High Court to  deal with all the issues and the evidence led by the parties  before recording its findings. The first appeal is a valuable  right  and  the  parties  have  a  right  to  be  heard  both  on  questions of law and on facts and the judgment in the first  appeal must address itself to all the issues of law and fact  and decide it by giving reasons in support of the findings.  (Vide  Santosh Hazari v.  Purushottam Tiwari,  (2001) 3 SCC  179 at p. 188, para 15 and Madhukar v. Sangram, (2001) 4  SCC 756 at p. 758, para 5.)

5. In  view  of  the  above  salutary  principles,  on  going  through the impugned judgment, we feel that the High Court  has failed to discharge the obligation placed on it as a first  appellate court. In our view, the judgment under appeal is  cryptic  and  none  of  the  relevant  aspects  have  even  been  noticed. The appeal has been decided in an unsatisfactory  manner. Our careful perusal of the judgment in the regular  first appeal shows that it falls short of considerations which  are  expected  from  the  court  of  first  appeal.  Accordingly,  without going into the merits of the claim of both parties, we  set  aside  the  impugned judgment  and decree of  the  High  Court and remand the regular first appeal to the High Court  for its fresh disposal in accordance with law.”

20) The aforementioned cases were relied upon by this court  

while reiterating the same principle in State Bank of India &  

Anr. vs. Emmsons International Ltd. & Anr., (2011) 12 SCC  

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174.  

21) Applying the aforesaid principle to the facts of the case,  

we find that  the High Court  while  deciding the first  appeal  

failed to keep the principle in consideration and rendered the  

impugned decision. Indeed, it is clear by mere reading of para  

4 of the impugned order quoted below:

“After  hearing  learned  counsel  for  the  parties  and  going  through the evidence, I do not find any justification to throw  over board findings recorded by the trial court.  After due  appreciation  of  evidence,  I  do  not  find  any  merit  and  substance  in  this  appeal.   Same  stands  dismissed  with  costs.   Counsel  fee  Rs.1000/-,  if  certified.   Ordered  accordingly.”

22) In our considered opinion, the High Court did not deal  

with any of the submissions urged by the appellant and/or  

respondent  nor  it  took  note  of  the  grounds  taken  by  the  

appellant  in  grounds  of  appeal  nor  made  any  attempt  to  

appreciate the evidence adduced by the parties in the light of  

the settled legal principles and decided case law applicable to  

the issues arising in the case with a view to find out as to  

whether judgment of the trial court can be sustained or not  

and if so, how, and if not, why?  

23) Being the first appellate court, it was the duty of the High  

Court  to  have  decided the  first  appeal  keeping  in  view the  

scope and powers conferred on it under Section 96 read with  

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Order 41 Rule 31 ibid mentioned above. It was unfortunately  

not  done,  thereby,  resulting  in  causing  prejudice  to  the  

appellant whose valuable right to prosecute in the first appeal  

on  facts  and  law  was  adversely  affected  which,  in  turn,  

deprived him of a hearing in the appeal in accordance with  

law.

24) It  is  for  this  reason,  we  are  unable  to  uphold  the  

impugned judgment of the High Court.  

25) The appeal thus succeeds and is accordingly allowed. The  

impugned judgment is set aside.  

26) The case is remanded to the High Court for deciding the  

first appeal afresh, keeping in view the principle of  law laid  

down by this Court quoted supra.

27) However, we make it clear that we have not applied our  

mind  to  the  merits  of  the  issues  involved  in  the  case  and  

hence,  the  High  Court  would  decide  the  appeal  strictly  in  

accordance with law on merits  uninfluenced by  any of  our  

observations, which we have refrained from making on merits.  

Needless to observe, the High Court will do so after affording  

an opportunity of hearing to both the parties and especially to  

the respondent because no one appeared today for him and  

hence,  the  High  Court  would  send  the  respondent  a  fresh  

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notice of  the final hearing of the appeal.

28) Since the case is quite old, we request the High Court to  

expedite its hearing.

                       ....................................J. [FAKKIR MOHAMED IBRAHIM KALIFULLA]

..................................J. [ABHAY MANOHAR SAPRE]

New Delhi; October 13, 2014.

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