Thursday, 12 September 2019

Whether appeal lies against a mere finding if such finding does not amount to decree?

There is a basic distinction between the right of
suit and the right of appeal. There is an inherent right in
every person to bring a suit of at civil nature, but the
right of appeal inheres in no one and therefore an appeal
for its maintainability must have the clear authority of
law. The various provisions in the C.P.C. show that under
the Code, an appeal lies only as against a decree or as
against an order passed under rates from which an appeal is
expressly allowed by Order 43, Rule 1. No appeal can lie
against a mere finding for the simple reason that the Codes
does not provide for any such appeal. Therefore, the first
appeal filed by. defendants 2 and 3 in the High Court was
not maintainable as it was directed against a mere finding
recorded by the trial court. 

SUPREME COURT OF INDIA

GANGA BAI  Vs.  VIJAY KUMAR & ORS.

DATE OF JUDGMENT 09/04/1974

BENCH:
CHANDRACHUD, Y.V.
BEG, M. HAMEEDULLAH
CITATION:
1974 AIR 1126 1974 SCR (3) 882,1974 SCC (2) 393




The Judgment of the Court was delivered by-
CHANDRACHUD, J. This is a plaintiff’s appeal on a
certificate granted by the High Court of Bombay, Nagpur
Bench, under Article 133(1)(a) of the Constitution-
On March 24, 1953 defendant 1 executed on behalf of himself
and ’his minor son defendant 2, a deed of mortgage in favour
of the plaintiff. Defendant 3 is also a son of defendant 1
but he was born, after the mortgage deed, on September 30,
1955. On January 11, 1956 a registered deed of partition
was executed amongst the defendants under which the
mortgaged property was allotted to the share of defendants 2
and 3.
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On September 1, 1956 the mortgagee filed Civil Suit No. 3A
of 1956 to enforce the mortgage. On September 20, 1958 the
trial court passed a preliminary decree for sale of
defendant 1’s interest in the mortgaged property. It held
that part of the consideration for the mortgage was not
supported by legal necessity and the, balance of the debt
incurred on the mortgage was tainted with immorality.
Though, therefore, defendant 1 had executed the mortgage as
a manager of the joint Hindu family consisting of himself
and defendant 2, the debt was held not binding on the onehalf
share of defendant 2 in the mortgaged property. On the
issue relating to the genuineness of the partition effected
by defendant 1 between himself and his suits, the trial
court recorded a finding that it wag a sham and colourable
transaction and its object was to delay or 1 defeat the
creditors.
Being aggrieved by. the decree directing the sale of half
the mortgaged property only, the plaintiff filed First
Appeal No. 40 of 1959 in the High Court of Bombay. Though
the suit was dismissed as against defendants 2 and 3, they
also filed an appeal in the High Court to challenge the
finding of the trial court that the deed of partition was a
sham and colourable transaction. That was First Appeal No.
72 of 1959.
During the pendency of these two appeals, the preliminary
decree was made final by the trial court on October 23,
1958. On March 2, 1960 the plaintiff purchased, with the
permission of tile court, a joint half share in the
mortgaged property in full satisfaction of his decree. On
September 21, 1960 the auction sale was confirmed and on

November 25, 1960 the plaintiff was put in joint possession
of the property.
On March 15, 1966 the appeals filed by the plaintiff and by
defendants 2 and 3 came up for hearing before a.Division
Bench consisting of Abhyankar and Deshmukh JJ. The hearing
of the appeals was adjourned from time to time and while-the
appeals were part-heard, defendants 2 and 3 applied on
August 2, 1966 for amendment of their Memorandum of Appeal
in-First Appeal No, 72 of 1959. By the proposed amendment
they sought leave of the High Court to challenge the
preliminary decree passed by the trial court. The plaintiff
opposed that amendment and applied that she did not desire
to prosecute First Appeal No. 40 of 1959 filed by her.
The High Court did not pass any orders either on the
application for amendment made by defendants 2 and 3 or on
the application of the plaintiff asking that her appeal be
dismissed for non-prosecution. On August 24, 1966 the High
Court adjourned the hearing of the appeals for three months
to enable defendants to pay the amount due under the
preliminary decree. On November 24, 1966 defendants 2 and 3
deposited Rs. 12,500 and applied for an extension of two
months for paying the balance. The extension was granted by
the High Court and on fabruary 25, 1967 defendants 2 and 3
deposited a further sum of Rs. 25,000 towards the
satisfaction of the preliminary decree.
On February 14, 1968 another Division Bench of the High
Court (Tambe and Badkas, JJ.) allowed the application of
defendants 2 and 3 for amendment of their Memorandum of
Appeal in First
Appeal No. 72 of 1959. On an application made by their
counsel, the High Court granted to those defendants time
till February 23, 1968 to pay the deficit court fees, which
they did. The High Court then took up the two First
Appeals. for hearing in March, 1968.
As the plaintiff had applied that she did not desire to
proceed with First Appeal No. 40 of 1959 filed by her, the
High-Court dismissed that appeal for non-prosecution. As a
consequence of this order the High Court observed that the
findings recorded by the trial court in favour of the
defendants and adverse to the plaintiff would stand
confirmed.
In First Appeal No. 72 of 1959 filed by defendants 2 and 3
it was urged by the plaintiff that as the appeal was
originally filed to challenge the finding of the trial court
on the question of genuineness of the partition. defendants
2 and 3 were not entitled to include now grounds in the
Memorandum of Appeal and that the Memorandum should not have
been permitted to be amended. The High Court hold that in
view of the Provisions of Order 41, Rule 2, Civil Procedure
Code. it was oven to defendants 2 and 3. with leave of the
court, to urge additional grounds in their appeal without
amending the Memo randum of appeal and therefore the
objection raised by the plaintiff as against the amendment
was futile.
The High Court further held that the appeal filed by
defendants 2 and 3 was competent even though the suit, was
wholly dismissed as against them. According to the High
Court, defendants 2 and 3 were aggrieved by the adverse
finding on the question of partition and further they were
denied under the preliminary decree the right to pay the
decretal amount and to redeem the mortgage. It was therefore
open to them to file an appeal against that decree.
On the merits of the appeal the High Court set aside the
finding of the trial court and held that the partition was

"real and genuine" and that it was not effected in order to
defeat :lie creditors. Defendants 2 and 3 bad therefore
become owners of the, equity of redemption and they could
not be deprived of the right to redeem the mortgage.
In the result, the High Court set aside the preliminary
decree as also the final decree and with it the auction sale
in favour of the plaintiff. The High Court passed a fresh
preliminary decree under Order 34, Rule 4, Civil Procedure
Code declaring that the plaintiff was entitled to recover
Rs. 34, 386 and odd and directing the defendants to pay the
entire decretal amount within six months of the date of
decree. The plaintiff questions the correctness of that
decree in this appeal.
It is necessary first to understand the nature of the appeal
filed by ,defendants 2 and 3 in the High Court and the
relief they sought therein. That appeal was in terms filed
only against the finding recorded by the trial court that
the partition between defendant 1 and his sons was a sham
and colourable transaction intended to defeat or delay the
creditors. The Memorandum of Appeal as filed originally
contained seven grounds, each of which was directed against the
finding given by the trial court on the question of
partition. The Memorandum contained a note that as the
subject-matter in dispute was not capable of being estimated
in terms of a money value, a fixed court fee of Rs. 20 was
paid thereon. Only one prayer was originally made in the
Memorandum of Appeal that the partition deed be declared as
genuine. Counsel for defendants 2 and 3, furnished to the
registry of the High Court a written explanation as required
by Rule 171 of the High Court Rules that as defendants 2 and
3 were only challenging the finding recorded by the trial
court on the question of partition and as they were merely
seeking a declaration that the partition was genuine, the
fixed court fee of Rs. 20 was properly paid.
It is thus clear that the appeal filed by defendants 2 and 3
in the High Court was directed originally not against any
part of the preliminary decree but against mere finding
recorded by the trial court that the partition was not
genuine. The main controversy before us centers round the
question whether that appeal was maintainable on this
question the position seems to us well-established. There
is a basic distinction between the right of suit and the
right of appeal. There is an inherent right in every person
to bring suit of a civil nature and unless the suit is
barred by statute one may, at one’s peril,_bring a suit of
one’s choice. It is no answer to a suit howsoever frivolous
the claim, that the law confers no such right to sue. A
suit for its maintainability requires no authority of law
and it is enough that no statute bars the suit. But the
position in regard to appeals is quite the opposite. The
right of appeal inheres in no one and therefore an appeal
for its maintainability must have the clear authority of
law. That explains why the right of appeal is described as
a creature of statute.
Under section 96(1) of the Code of Civil Procedure, save
where otherwise expressly provided by the Code or by any
other law for the time being in force, an appeal lies from
every decree passed by any court exercising original
jurisdiction, to the court authorised to hear appeals from
the decisions of such court. Section 100 provides for a
second appeal to the High Court from an appellate decree
passed by a court subordinate to the High Court. Section
104(1) provides for appeals against orders of the kind

therein mentioned and ordains that save as otherwise
expressly provided by the Code or by any law for the time
being in force an appeal shall lie "from no other orders".
Clause (i) of this section provides for an appeal against
"any orders made under Rules from which an appeal is
expressly allowed by rules". ’Order 43, Rule 1 of the Code,
which by reason of clause (i) of section 104(1) forms a part
of that section, provides for appeals against orders passed
under various rules referred to in clauses (a) to (w)
thereof, Finally, section 105(1) of the Code lays down that
save as otherwise expressly provided, no appeal shall lie
from any order made by a court in exercise of its original
or appellate jurisdiction.
These provisions show that under the Code of Civil
Procedure, an appeal lies only as against a decree or as
against an order passed under, rules from which an appeal is
expressly allowed by Order 43, Rule 1.

No appeal can lie against a mere finding for the simple
reason that the Code does not provide for any such appeal.
It must follow that First Appeal No. 72 of 1959 filed by
defendants 2 and 3 was not maintainable as it was directed
against a mere finding recorded by the trial court.
The High Court mixed up two distinct issues : one, whether
it was competent to defendants 2 and 3, if they were
aggrieved by the preliminary decree of file an appeal
against that decree; and two, whether the appeal such as was
filed by them was maintainable. If it be correct that
defendants 2 and 3 could be said to have been aggrieved by
the preliminary decree, it was certainly competent for them
to challenge that decree in appeal. But they did not file
an appeal against the preliminary decree and therefore the
question whether they were aggrieved by that decree and
could file an appeal therefrom was irrelevant. While
deciding whether the appeal filed by defendants 2 and 3 was
maintainable ’ , the High Court digressed into the question
of the competence of defendants 2 and 3 to file an appeal
against the preliminary decree and taking the view that it
was open to them to challenge that decree even though the
suit was wholly dismissed against them, the High Court held
that the appeal, which in fact Was directed against a finding
given by the trial court, was maintainable. It the High
Court had appreciated that the-two questions were distinct
and separate, it would not have fallen into the error of
deciding the latter question by considering the former.
Adverting to the question which the High Court did consider,
namely, whether defendants 2 and 3 could be said to be
aggrieved by the preliminary decree, there is nothing in the
terms of that decree which precluded those defendants from
depositing the decretal amount to be able to redeem the
mortgage. The trial court had passed the usual preliminary
decree for sale in Form No. 5A, under Order 34, Rule 4,
Civil Procedure Code. If the amount found due to the
appellant under the decree was paid into the court within
the stipulated or extended period, the appellant would have
been obliged to deliver to the mortgagors all the documents
in her possession or power relating to the mortgaged
property and to deliver up to the defendants quiet and
peaceable possession of the property free from the mortgage.
The amount declared to be due to the appellant by the
preliminary decree was not paid by the defendants, from
which it would appear that they were not interested in
paying the amount. It is significant that defendants 2 and
3 were served with the notice of final decree proceedings
and they appeared therein. The Code is merciful to

mortgagors and perhaps ’rightly, because the mortgagee ought
to have no grievance if the loan advanced by him is repaid
with permissible interest, costs and expenses. Under Order
21, Rule 89, it was open to defendants 2 and 3 as late as
after the appellant purchased the property in the auction
sale, to pay the amount due to her. These defendants had
interest in the mortgaged property by virtue of a title
acquired before the sale, that is, under the registered
partition dated January 11, 1956. Under Order 21, Rule 89,
where immovable property is sold in execution of a decree,
any person owing the property or holding an interest there-
888
in by virtue of a title acquired before the sale, can apply
to have the sale set aside on his depositing in Court, for
payment to the purchaser a sum equal to five per cent of the
purchase-money and for payment to the decree-holder, the
amount specified in the proclamation of sale as that for the
recovery of which the sale was ordered. Nothing of the kind
was done and even the last significant opportunity was not
availed of by the defendants. Counsel for the appellant
seems right that the defendants were content that only half
the mortgaged property was directed to be sold and that it
was only because of the later appreciation in prices of real
property that defendants 2 and 3 awoke to the exigency of
challenging the preliminary decree. That was much too late.
So late indeed, that not having any plausible reason to
assign for the inordinate delay caused in applying for an
amendment of the appeal, they preferred not to file an
application for condonation of delay at all. The appeal was
filed on January 4, 1959 while, the application for
amendment was made on August 2, 1966.. Event though no
explanation was offered for the long delay of over 7-1/2
years, the High Court allowed the amendment with a laconic
order "Application for amendment allowed".
Thus, the appeal filed by defendants 2 and 3 being directed
against a mere finding given by the trial court was not
maintainable; defendants 2 and 3 were not denied by the
preliminary decree the right to pay the decretal amount; and
the two defendants could even have applied under Order 21,
Rule 89, for setting aside the sale in favour of the
appellant but they failed to do so as, presumably, they were
not interested in paying the amount. The High Court was
therefore wholly in error in allowing the amendment of the
Memorandum of Appeal, particularly when defendants 2 and 3
had neither explained the long delay nor sought its
condonation.
The preliminary decree had remained unchallenged since September
1958 and by lapse of time a valuable right had
accrued in favour of the decree-holder. The power to allow
an amendment is undoubtedly wide and may at any stage be
appropriately exercised in the interest of justice, the law
of limitation notwithstanding. But the exercise of such
far-reaching discretionary powers is governed by judicial
considerations and wider the discretion, greater ought to be
the care and circumspection on the part of the court. The
appeal in terms was originally directed against the finding
given by the trial court that the partition was sham and
colourable. "Being aggrieved by the finding given in the
Judgment and the Decree........... it is humbly prayed that
findings given by the learned Judge in Para 34 of his
Judgment may kindly be set aside, and instead the partition
deed dated 11-1-56 may kindly be declared as genuine"--So
ran the Memorandum of Appeal. Defendants 2 and 3 reiterated
through their counsel by Ming a note to explain the payment
of fixed court fees of Rs. 20 that they were "seeking the

relief of declaration only" and therefore the court fee paid
was proper and sufficient. Long years thereafter, the High
Court allowed the Memorandum to be amended not a reason was
cited to, explain the delay and not a reason was given to
condone it. And it was not appreciated that in granting
time to defendants 2 and 3 to
889
make up the deficit of the court fees 71 years after the
appeal was filed, an amendment was being allowed which had
its impact not only on the preliminary decree but on the
final decree which was passed in the meanwhile, the auction
sale which was held in pursuance of the final decree and the
sale certificate which was granted to _the appellant who,
with the leave of the court and in full satisfaction of her
decree, had purchased a joint 1/3 share in the mortgaged
property. With the striking down of the preliminary decree,
these proceedings had to fall but the error really lay in
allowing the amendment so as to permit, without good cause
shown, a belated challenge to the preliminary decree.
One other aspect of the question relating to the
maintainability of the appeal yet remains to be examined.
Counsel for the respondents. argues that the finding of the
trial court on the issue of partition would have operated as
res judicata against them and they were therefore entitled
to appeal therefrom.
In Harchandra Das v. Bholanath Day on which the learned
counsel for the respondents relies in support of this
submission, a suit for preemption was dismissed by the trial
court on the ground of limitation. In an appeal filed by
the plaintiff, the District Court reversed that finding but
confirmed the decree dismissing the suit on the ground that
the sale effected by defendants 4 and 5 in favour of
defendants 1, 2 and 3 was not validly registered and there
being no "sale", there can be no right of preemption.
Defendants 1 to 3 preferred an appeal to the High Court
against the finding recorded by the District Court that the
sale effected in their favour by defendants 4 and 5 was not
valid as it was not lawfully registered. On a preliminary
objection raised by the plaintiffs to the maintainability of
the appeal, the High Court of Calcutta, held that though
under the Code of Civil Procedure there can be no appeal as
against a mere finding, "it may be taken to be the view of
courts in India generally, that a party to the suit adversely
affected by a finding contained in a judgment, on which
a decree, is based, may appeal; and the test applied in some
of the, cases for the purpose of determining whether a party
has been aggrieved or not was whether the finding would be
res judicata in other proceedings". The High Court,
however, upheld the preliminary objection on the ground that
the issue regarding validity of the sale which was decided
against defendants 1 to 3 would not operate as res judicata
in any subsequent proceeding and therefore the appeal which
was solely directed against the finding on that issue was
not maintainable.
The position here is similar to that in the Calcutta case.
The trial court decreed the mortgagee"s suit only as against
defendant 1, the father, and directed the sale of his one
half interest in the mortgaged property on the ground that
part of the consideration for the mortgage was not supported
by legal necessity, the remaining part of the consideration
was tainted with immorality and therefore the mortgage was
not binding on the interest of the sons, defendants 2 and 3.
Whether the partition between the father and sons was sham
or real had no
(1) I.L.R. [1935] 62 Cal. 701.

impact on the judgment of the trial court and made no
material difference to the decree passed by it. The finding
recorded by the trial court that the partition was a
colourable transaction was unnecessary for the decision of
the suit because even if the court were to find that the
partition was genuine, the mortgage would only have bound
the interest, of the father as the debt was not of a
character which, under the .Hindu law, would bind the
interest of the sons. There is no substance .in the
submission made on behalf of the sons that if the partition
was held to be genuine, the property would have been wholly
freed from .the mortgage encumbrance. The validity or the
binding nature of an .alienation cannot depend on a
partition effected after the alienation; or else, a sale or
a mortgage effected by the Karta of a joint-Hindu family
,can easily be avoided by effecting a partition amongst the
members of .the joint family. As the matter relating to the
partition was not directly and substantially in issue ’in
the suit, the finding that the partition was sham cannot
operate as res judicata. Therefore, the appeal filed by
defendants 2 and 3 against that finding was not
maintainable, even on ,,the assumption that the High Court
of Calcutta is right in its vie", that though under the Code
there could be no appeal against a finding, ,yet "On grounds
of justice" an appeal may lie against a finding provided
that it would operate as res judicata so as to preclude a
party aggrieved by the finding from agitating the question
covered by the .finding in any other proceeding. It is not
necessary here to determine ,whether the view of the
Calcutta High Court is correct.
For these reasons we allow the appeal with costs, set aside
the judgment of the High Court and restore that of the trial
court.
S. C. Appeal allowed.

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