Shanti Kumar R. Canji Vs. The Home
Insurance Co. of New York [1974] INSC 127 (24 July 1974)
RAY, A.N. (CJ) RAY, A.N. (CJ) MATHEW, KUTTYIL
KURIEN
CITATION: 1974 AIR 1719 1975 SCR (1) 550 1974
SCC (2) 387
CITATOR INFO:
RF 1981 SC1786 (107,116,139,152)
ACT:
Letters Patent of the Bombay High Court, Cl.
15--Judgment, what is
HEADNOTE:
The appellant filed the suit against the
respondent in 1964, on the original side of the High Court, claiming six months’
salary in lieu of notice and gratuity. An application for amendment of the
plaint in regard to damages for the right to pension was made in 1970. The
respondent contended that the amendment should not be allowed on the ground
inter alia that the alleged claim was barred by limitation in 1970.
The trial Court allowed the amendment, but in
appeal under Cl. 15 of the Letters Patent, the order was set aside. The High
Court considered the application for amendment to be a new claim based upon a
new set of facts which became barred on the date of the application for
amendment.
In appeal to this Court, it was contended
that: (1) the order of the trial Court was not a judgment and hence not
appealable under Cl. 15, and (2) the order was a discretionary order and the
appellate Court should not have interfered with the exercise of discretion.
Dismissing the appeal,
HELD : (1) A judgment within the meaning of
Cl. 15 would have to satisfy two tests, (a) it must be the final pronouncement
which puts an end to the proceeding so far as the Court dealing with it is
concerned; and (b) it must involve the determination of some right or liability
though it may not be necessary that there must be a decision on the merits.
[554 B] In finding out whether any decision is a judgment within the meaning of
Cl. 15, each case must be looked into in order to find out whether there is a
decision determining the right or liability of the parties affecting the merits
of the controversy between the parties. It is not the form but the nature of
the order that has to be examined in order to ascertain whether there has been
a determination of any right or liability. If an amendment merely allows the
plaintiff to state a new cause of action or to ask a new relief or to include a
new ground of relief all that happens is that it is possible for the plaintiff
to raise further contentions in the suit, but it is not decided whether the
contentions are right. Such an amendment does nothing more than regulate the
procedure applicable to the suit and does not touch the merits of the
controversy between the parties.
Where, on the other hand, an amendment takes
away from the defendant the defence of immunity from any liability by reason of
limitation, it is a judgment within the meaning of Cl. 15. The reason why it
becomes a judgment is that it is a decision. affecting the merits of the
question between the parties by determining the right or liability based on
limitation. It is the final decision as far as the Court is concerned. The
respondent, in the present case, has acquired, by reason of limitation, immunity
from liability, and the appellant, because of the limitation of the cause of
action, has no power to render the respondent liable for the alleged claim.
[554 B-C, G., 555F-H,556A-C] (2) The order of the trial Court is not one purely
based on discretion, and even with regard to discretionary orders the appellate
Court can interfere where the order is unsupportable in law or is unjust. The
High Court was right in holding that there we're no special circumstances to
entitle the appellant to introduce the claim by amendment.
[556F] Asrumati Debi v. Kumar Rupendra Deb
Raikot & Ors. [1953] S.
C. R. 1159, followed.
Justice of the Peace for Calcutta v. Oriental
Gas Company, 8 Bengal L. R. 433, Tuliaram v. Alagappa 1. L. R. 35 Mad. J., M.
B. Sirkar & Sons v. Powell & Co. A.I.R. 1956. Cal. 630, approved. .
Charan Das v. Amir Khan 47 1. A. 255 referred
to.
Dayabhai v. Murugappa Chettiar I. L. R. 13
Rang. 457 and Manohar v. Bailram I.L. R. 1952 Nag. 471, overruled.
551 For the appellant: On the first point, an
order allowing amendment is not a "Judgment" within the meaning of
clause 15 of the Letters Patent. Divergent views have been taken by various
High, Courts as to the meaning of word "Judgment". This question came
before this Court also in the case of 'Asrumati devi' (1953) SCR II 59-where a
question arose whether an order for transfer of a suit under clause 13 of the
Letters Patent (Calcutta High Court) is not a "Judgment" within the
meaning of clause 15 of the Letters Patent; and this Court took the view that
an order of this character could not be regarded as a 'Judgment' but it did not
determine the true meaning and scope of the word "Judgment", nor did
it resolve a wide divergence of judicial opinion on the subject. An order to be
a 'Judgment' in Cl.
15 of the Letters Patent must either
determine some right or liability which is in controversy in the suit either
partially or wholly; or it should terminate the proceedings even without
deciding any right or liability in controversy.
Any wider definition of the word 'Judgment'
will make all orders appealable irrespective of their nature and irrespective
of the proceeding in which they are passed. An interim order which does not
determine any substantive right or liability in controversy (i.e. does not
grant or refuse any part of the relief prayed for in a suit), but decides a
procedural right, however important, is not a 'judgment'.
An order allowing the amendment does not
decide any substantive right or liability. It only permits a claim to be
agitated and does not decide the claim and, therefore, the order of the single
judge was not appealable. Justice of the Peace for Calcutta v. The Oriental Gas
Co. 8 Bengal L.R.
433, Tuljaram v. Alagappa ChelterI.L.R. 35
Mad., I;I.L.R.
Rang. 457 and I.L.R. [1952] Nag. 471 (F.B.)
referred to.
On the second point, it is settled law that
an appellate Court will not interfere with such an order passed by the trial
Court in exercise of its discretion without exceeding the limits, of its power,
unless it acted perversely or unless the view taken by it is clearly wrong. The
amendment sought for became necessary as on the true and full disclosure of the
terms of Pension Rules, the Appellant was found to be entitled to damages in
lieu of pension.
The principle of res judicata did not apply
as the earlier order of the Single Judge allowing the first amendment
application partly on 19-1-1970 did not deal with the claim for mortised damage
now sought to be added.
For the Respondent: There is no need to go
into the larger question because judged by the tests laid down by all the High
Courts including the Nagpur High Court, the decision of the trial Court in the
instant case allowing the amendment, is a judgment within the meaning of Cl. 15
of the Letters Patent. By reason of the amendment of the plaint, the claim made
in the amended plaint dates back to the date of the plaint. The application for
amendment was filed in April, 1970 and by that time, the claim for pension was
clearly barred by limitation. By allowing amendment, the valuable right which
had accrued to the defendant to resist the claim for pension, has been lost the
defendants cannot therefore, once the amendment is allowed raise the plea of
limitation.
There is a clear negation of valuable right
of 552 the defendant which is undoubtedly a determination of right or liability
as between the two parties. There is difference between the amendment which
does not take away the right of the defendant to plead limitation and an
amendment which affects the rights of the defendants to raise the plea of
limitation 1946 Calcutta 630; 1946 Bom.
361; AIR 1972 Bombay 27 ; 1967 (2) M.L.J.
(FB) referred to.
35 Madras at p. 9 lays down the law that the
fact that the order is one allowing the amendment, is not decisive and that if
in any proceeding, the defendants could have succeeded by the Court passing an
order as prayed for, that itself is sufficient to make a decision a judgment
and the fact that the defendant's contention was negatived i.e. an order prayed
by him was not passed; does not make the decision any the less a judgment under
Cl. 15. 29 Bombay 249, 253 in [1953] S.C.R. 1159, 1168. 70 Ca. W.N.670,[1971]
S.C.R. 783 referred to.
By allowing the amendment, the right is
conferred upon the plaintiff and it carries with it the fastening of liabilities
upon the defendants.
The decision on a vital points adverse to the
defendant which goes to the root of the matter and which becomes final and
conclusive, so far as the court passing of the order is concerned, would amount
to a Judgment because the order is to the effect that the plaintiff is entitled
to make the claim negativing the right of the defendants which has accrued to
him by lapse of time.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 1991 of 1971.
From the Judgment and, Order dated the 29th
March, 1971, of the Bombay High Court and Bombay in Appeal No. 87 of 1970.
V.M. Tarkunde and Rameshwar Nath for the
appellant K.S.Ramamurthy and B.R. Agarwal for the respondent.
The Judgment of the Court was delivered by
RAY, C. J.-This is an appeal by certificate from the judgment dated 29th March,
1971 of the High Court of Bombay.
The appellant filed this suit on 2 September,
1964 in the High Court of Bombay and claimed six months salary in lieu of
notice and gratuity for 16 years of service.
In the year 1965 the appellant asked for
discovery by the respondent of documents relating to pension scheme for foreign
employees. The application for discovery was dismissed in the month of
November, 1965.
On 16 December, 1969 the appellant took out a
Chamber Summons for amendment of the plaint. The proposed amendments were
twofold. The first set of amendment related to averments in support of the
claim for gratuity which had already been alleged in the plaint.
553 The second set of amendment related to
averments in support of a claim for Rs. 850 per month by way of pension as and
from 1 February, 1964 during the life time of the appellant.
By an order dated 19 January, 1970 the
appellant was allowed to amend the plaint in respect of the claim for gratuity.
The appellant's proposed amendment in support
of the claim for pension was refused.
By summons dated 27 April, 1970 the appellant
sought an amendment of. the plaint claiming Rs. 68,000 as damages in relation
to his right to pension. By an order dated 6 July, 1970 the appellant was
allowed to amend the plaint as prayed for.
The respondent preferred an appeal against
the order dated 6 July, 1970. The High Court by judgment dated 29 March, 1971
allowed the appeal and set aside the order dated 6 July, 1970 allowing the
amendment.
The appellant repeated the contentions which
had been advanced before the High Court. First, it was said that no appeal
could lie against an order of amendment because it was not a judgment within
the meaning of clause 15 of the Letters Patent. Secondly, it was said that an
order allowing the amendment was a discretionary cider.
Therefore, the appellate court should not
have interfered with the discretion.
Counsel for the appellant submitted that
'judgment' means a decision finally adjudicating the rights between the
parties. It was emphasised that a judgment would be a decision on substantive
rights of parties. 'Amendment' was submitted to be a procedural right. Counsel
for the appellant relied on the decision in Dayabhai v. Murrugappa Chettiar I.
L. R. 13 Rang. 457 and Manohar v. Baliram I.L.R.
1952 'Nag. 471 in support of the proposition
that 'judgment' means and is a decree in a suit by which the rights of the
parties in the suit are determined.
The locus classics is the decision of the High
Court of Calcutta in Justice of the Peace for Calcutta v. Oriental Gas Company
8 Bengal L.R. 433 where Sir Richard Couch, C. J.
said "We think that 'judgment' 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."
This Court in Asrumati Debi v. Kumar Rupendra Deb Raikot & Ors. [1953]
S.C.R. 1159 dealt with the question as to whether an order of transfer of a
suit filed in the Jalpaiguri Court to the High Court to be tried in its Extraordinary
Original Civil Jurisdiction was a judgment within the meaning of clause 15 of
the Letters Patent. it was held that an order for transfer of a suit is not a
judgment within the meaning of clause 15 of the Letters Patent as it neither
affects the merits of the 554 controversy between the parties in the suit
itself nor terminates or disposes of the suit on any ground.
This Court in Asrumati Debi's case (supra)
said that a judgment within the meaning of clause 15 of the Letters Patent
would have to satisfy two tests. First, the judgment must be the final
pronouncement which puts an end to the proceeding so far as the court dealing
with it is concerned.
Second, the judgment must involve the
determination of some right or liability though it may not be necessary that
there must be a decision on the merits. In this context this Court referred to
observation of the Full Bench of the High Court of Madras in Tuljaram v.
Alagappa I.L.R. 35 Mad. 1.
The test formulated by the Madras decision is
not the form of the adjudication but its effect on the suit or proceeding in
which it is made. The Madras High Court said "if the effect is to put an
end to the suit or proceeding so far as the Court before which the suit or
proceeding is pending is concerned, or if its effect, if it is not complied
with, is to put an end to the suit or proceeding, the adjudication is a
judgment". It may be stated here that the Madras High Court spoke of
'judgment' on an application in a suit. The decision of the Madras High Court
in Tuljaram's case (supra) was on an order for transfer of a suit under clause
13 of the Letters Patent.
This Court also noticed the view expressed by
the Madras High Court in Tuljaram's case (supra) that adjudication on an
application, which is nothing more than a step towards obtaining a final
adjudication in the suit, is not a judgment within the meaning of the Letters
Patent. In Asrumati Debi's case (supra) this Court noticed the argument
advanced that if an order refusing to rescind leave to sue granted under clause
12 of the Letters Patent was a 'judgment' under clause 15 of the Letters Patent
there was no difference in principle between an order of that description and
an order transferring the suit under clause 13 of the Letters Patent. This
Court did not express any opinion excepting observing that if leave under
clause 12 of the Letters Patent was rescinded, the suit would come to an end
and if an order was made refusing to rescind the leave the result would be on a
vital point adverse to the defendant and it would go to the root of the suit
and become final and decisive against the defendant so far as the Court making
the order was concerned.
In finding out whether any decision is a
judgment within the meaning of clause 15 of the Letters Patent each case must
be looked into, in order to find out as to whether there is a decision
determining the right or liability of the parties affecting the merits of the
controversy between the parties.
It is in that light that this Court in
Asrumati Debi's case (supra) described the order refusing to rescind leave to
be within the category of a judgment as laid down in the Calcutta cases though
no final opinion was expressed as to the propriety of that view.
The present appeal concerns an application
for amendment of the plaint. The suit was filed in the year 1964. The
application for amendment of the plaint in regard to damages for the right to
pension was made in the year 1970. An amendment, if allowed', would relate 555
to the date of the institution of the suit. The respondent contended before the
trial Court entertaining the application for amendment of the plaint that the
amendment should not be allowed inter alia on the ground that the alleged claim
was barred by limitation in 1970.
The High Court in the present case relied on
the decision of the High Court at Calcutta in M.B. Sarkar & Sons v. Powell
& Co. A.I.R. 1956 Cal. 630. In that case an amendment was allowed on
Chambers Summons substituting in place of the original defendant which was
described as a firm a defendant converted into a company in that name. The
company so proposed to be substituted complained that the amendment took away
from it a valuable right which had accrued to it by efflux of time, and,
therefore, the amendment should not be allowed. The contention of the defendant
was not accepted by the learned Chamber Judge. The High Court on appeal set
aside the order. It was not held to be a case of mis-description of the
defendant. A mis-description of a party impleaded can arise when the party
really intended to be impleaded had always been the same and such intention
appeared clearly from the body of the plaint in spite of the inaccurate
mis-description in the cause title. In such a case, it would not be adding a
new party or substituting a new party for the original one, but perfecting the
identity of the party originally impleaded clearing or rectifying the
inaccurate description. When the same person, whether an individual or a legal
entity, remains the defendant but only the name is altered, it would be a case
of mis-description.
Where a new legal entity is substituted, it
was held in the M. B. Sarkar case (supra) that substitution of a company for a
firm would be a change of a substantial character affecting the right of a
party. The effect of the amendment in the M. B. Sarkar case (supra) was to
substitute a new party for the party originally impleaded and the consequence
was to take away from the new party so substituted his defence of limitation
that a suit brought on the date of the amendment would be barred by time.
Chakravartti, C.J. in the M. B. Sirkar case (supra) said that an order for
amendment of the plaint there decided a vital question concerning the merits of
the case and the rights of the newly impleaded party and therefore became a
judgment within the meaning of clause 15 of the Letters Patent.
The right to claim that an introduction of a
cause of action by amendment is barred by limitation is founded on immunity
from a liability. A right is an averment of entitlement arising out of legal rules.
A legal right may be defined as an advantage or benefit conferred upon a person
by a rule of law. Immunity in short is no liability. It is an immunity from the
legal power of some other person. The correlative of immunity is disability.
Disability means the absence of power. The appellant in the present case
because of the limitation of the cause of action has no power to render the
respondent liable for the alleged claim. The respondent has acquired by reason
of limitation immunity from any liability.
The views of the High Courts at Calcutta and
Madras with regard to the meaning of 'judgment' are with respect preferred to
the meaning of 'judgment' given by the Rangoon and Nagpur High Courts.
556 We are in agreement with the view
expressed by the High Court at Calcutta in the M. B. Sirkar case (supra) as to
when an order on an application for amendment can become a judgment with in the
meaning of clause 15 of the Letters Patent. If an amendment merely allows the
plaintiff to state a new cause of action or to ask a new relief or to include a
new ground of relief all that happens is that it is possible for the plaintiff
to raise farther contentions in the suit, but it is not decided whether the
contentions are right. Such an amendment does nothing more than regulate the
procedure applicable to the suit. it does not decide any question which touches
the merits of the controversy between the parties. Where, on the other hand, an
amendment takes away from the defendant the defence of immunity from any
liability by reason of limitation, it is a judgment within the meaning of
clause 15 of the Letters Patent. The reason why it becomes a judgment is that
it is a decision affecting the merits of the question between the parties by
determining the right or liability based on limitation. It is the final
decision as far as the trial court is concerned.
In finding out whether the order is a
judgment within the meaning of clause 15 of the Letters Patent it has to be
found out that the order affects the merits of the action between the parties
by determining some right or liability.
The right or liability is to be found out by
the court. The nature of the order will have to be examined in order to
ascertain whether there has been a determination of any right or liability.
The appellant made an application in
December, 1969 for amendment of the plaint to claim pension. Those amendments
were disallowed by the learned Chamber Judge. Four months thereafter the
appellant sought to amend the plaint by adding certain paragraphs and those
amendments were in relation to the appellant's alleged claim for pension. The
appellant submitted that the second application for amendment in regard to the
claim for a mortised amount of damages in relation to pension was not the same
as the first application. It was said on behalf of the appellant that if the
learned Judge allowed the application the appellate court should not have
interfered with the discretionary order. The amendment order is not purely of
discretion.
Even with regard to discretionary orders the
appellate court can interfere where the order is insupportable in law or is
unjust. The High Court considered the second application for amendment to be a
new claim based on the new set of facts which became barred on the date of the
application for amendment. In exceptional cases an amendment has been allowed
where the effect is to take away from a defendant a legal right which has
accrued to him by lapse of time, because the court found that consideration of
lapse of time is out weighed by the special circumstances of the case.
(See Charan Das v. Amir Khan 47 I.A. 255).
The High Court rightly found that there were no special circumstances to
entitle the appellant to introduce by amendments such claim.
For these reasons, the judgment of the High
Court is upheld.
The appeal is dismissed with costs.
V.P.S.
Appeal dismissed.
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