Arrears of cases have always been a problem for Indian Judicial System. Something which is common and finds place in the list of arrears throughout the High Courts is Second Appeal in Civil Cases. The issue is so trending that every other day we find some decision of Apex Court assailing the approach adopted by High Courts while dealing with Second Appeal in Civil Cases. Because of the laxity with which second appeals are admitted and lack of serious scrutiny of the provisions of Civil Procedure Code, the parties are facing problem of continuous and vexatious litigation.
Despite declaration of law in numerous judgments, it is evident that the scope and ambit of Section 100 C.P.C. has not been properly appreciated and applied in a large number of cases. The authors in this present Bi-Partite Article Series makes a serious endeavour to discern legislative intention, ambit and scope of interference under Section 100 C.P.C. The authors plan to carry out this exercise by examining important judgments decided recently. This effort is made with the hope that it will help the legal community in understanding the correct position of law.
PART-I
Introduction
The expression appeal has not been defined in the code. According to dictionary meaning, “appeal” is the judicial examination of the decision by a higher court of the decision of an inferior court.[i] In Nagendra Nath Dey vs Suresh Chandra Dey[ii], it was said that there is no definition of appeal in the Code of Civil Procedure, but there is no doubt that any application by a party to an appellate Court, asking it to set aside or revise a decision of a subordinate Court, is an appeal within the ordinary acceptation of the term, and that it is no less an appeal because it is irregular or incompetent. So appeal is basically testing the soundness of decision of lower court by the higher court.
Sections 100 to 103, 107-108 and Order 42 of Civil Procedure Code (CPC)[iii] deal with second appeals. Right of appeal is not a natural or inherent right and it does not exist unless expressly conferred by the statute.[iv] It is to be noted that only from decrees second appeal lies and not from orders. Under CPC Second Appeal always lies to High Court.[v]
History
Section 100 of the Code of Civil Procedure, 1908 (for short, C.P.C.) corresponds to Section 584 of the old Civil Procedure Code of 1882. The Section 100 (prior to 1976 amendment) reads as under:
“100. Second appeal
(1) “Save where otherwise provided in the body of this Code or by any other law for the time being in force, an appeal shall lie to the High Court from every decree passed in appeal by any Court subordinate to a High Court on any of the following grounds, namely :
(a) the decision being contrary to law or to some usage having the force of law;
(b) the decision having failed to determine some material issue of law or usage having the force of law;
(c) a substantial error or defect in the procedure provided by this Code or by any other law for the time being in force, which may possibly have produced error or defect in the decision of the case upon the merits.
(2) An appeal may lie under this section from an appellate decree passed ex parte.”
The wide language of this section and liberal interpretation by judiciary by adopting several concepts like a mixed question of law and fact, a legal inference drawn from the facts proved and even the point that case has not been properly approached by the courts below, practically resulted in giving a goodbye to the basic principle that on questions of fact decisions of courts of first instance would be final subject to one appeal. This created a confusion in the minds of the public as to the legitimate scope of second appeal and unnecessary burdened High Courts.
Need for Change
The facility of appeal is founded on a most laudable principle of securing, by double and treble checks, the proper decision of all suits, but the utopian idea, in its attempt to prevent individual injury from a wrong decision, has been productive of general injustice by withholding redress, and general inconvenience, by perpetuating litigation.
Supreme Court’s observation in Deity Pattabhiramaswamy v. S. Hanymayya and Others[vi] shows that why there was a need for an amendment. Court observed that notwithstanding the clear and authoritative pronouncement of the Privy Council on the limits and the scope of the High Court’s jurisdiction under section 100, Civil Procedure Code, “some learned Judges of the High Courts are disposing of Second Appeals as if they were first appeals. This introduces, apart from the fact that the High Court assumes and exercises a jurisdiction which it does not possess, a gambling element in the litigation and confusion in the mind of the litigant public”.
Law Commission in its Fifty-Fourth Report as well Shah Committee in its report advocated for stricter and better scrutiny of second appeal and argued for right to second appeal only on questions of law.
In the light of these observations the Amendment Act of 1976 was brought in and it introduced drastic changes in the scope and ambit of Section 100 C.P.C. A second appeal under Section 100 C.P.C. is now confined to cases where a question of law is involved and such question must be a substantial one. Section 100, as amended, reads as under:
“100. Second appeal.
(1) Save as otherwise expressly provided in the body of this Code or by any other law for the time being in force, an appeal shall lie to the High Court from every decree passed in appeal by any Court subordinate to the High Court, if the High Court is satisfied that the case involves a substantial question of law.
(2) An appeal may lie under this section from an appellate decree passed ex parte.
(3) In an appeal under this section, the memorandum of appeal shall precisely state the substantial question of law involved in the appeal.
(4) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question.
(5) The appeal shall be heard on the question so formulated and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question:
Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law, not formulated by it, if it is satisfied that the case involves such question.”
The scope of interference by the High Court in second appeal under section 100 CPC after 1976 Amendment is strictly confined to cases involving substantial questions of law. The High Court would not be justified in dealing with any second appeal without first formulating substantial question of law.
In Chacko & Another v. Mahadevan[vii], while dealing with the jurisdiction of Sections 96 and 100 CPC, the court laid down as under:
“It may be mentioned that in a first appeal filed under Section 96 CPC, the appellate court can go into questions of fact, whereas in a second appeal filed under Section 100 CPC the High Court cannot interfere with the findings of fact of the first appellate court, and it is confined only to questions of law.”
Substantial Question of Law
The term has not been defined by the legislature. However it cannot be confined to a strait- jacket formula and no rule of universal application can be formulated as to when it can be said that a substantial question of law has arisen. What is a substantial question of law as between the parties would certainly depend upon the facts and circumstances of every case. Thus for instance, if a question of law had been settled by the highest court of the country the question of law however important or difficult it may have been regarded in the past and however much it may affect any of the parties would cease to be a substantial question of law. Nor again, would a question of law which is palpably absurd be a substantial question of law as between the parties.[viii]
To be “substantial”, a question of law must be debatable, not previously settled by the law of the land or any binding precedent, and must have a material bearing on the decision of the case and/or the rights of the parties before it, if answered either way.
“To be a question of law “involved in the case”, there must be first, a foundation for it laid in the pleadings, and the question should emerge from the sustainable findings of fact, arrived at by Courts of facts, and it must be necessary to decide that question of law for a just and proper decision of the case. An entirely new point, raised for the first time, before the High Court, is not a question involved in the case, unless it goes to the root of the matter.”[ix]
A question of law is fairly arguable, where there is room for difference of opinion on it or where the Court thought it necessary to deal with that question at some length and discuss alternative view, then the question would be a substantial question of law. On the other hand if the question was practically covered by the decision of the highest court or if the general principles to be applied in determining the question are well settled and the only question was of applying those principles to the particular fact of the case it would not be a substantial question of law.
A substantial question of law is one which is of general public importance or which directly and substantially affects the rights of the parties and which have not been finally settled by the Supreme Court, the Privy Council or the Federal Court or which is not free from difficulty or which calls for discussion of alternative views.[x]
Substantial Question of Law and Question of Law of General Public Importance
Substantial question is not necessarily a question which is of general public importance. It must be a substantial question of law as between-the parties in the case involved. But here again it must not be forgotten that what is contemplated is not a question of law alone; it must be a substantial question. One can define it negatively. For instance, if there is a well-established principle of law and that principle is applied to a given set of facts that would certainly not be a substantial question of law. Where the question of law is not well settled or where there is some doubt as to the principle of law involved, it certainly would raise a substantial question of law which would require a final adjudication by the highest Court.[xi]
A question of law is substantial as between the parties if the decision turns one way or another on the particular view taken of the law. If it does not affect the decision then it cannot be substantial as between the parties. But if it substantially affects the decision then it is substantial as between the parties though it may be wholly unimportant to others.[xii]
Second Appeal in High Courts- The Never Ending Litigation
PART-II
Judges must administer law according to the provisions of law. It is the bounden duty of judges to discern legislative intention in the process of adjudication. Justice administered according to individual’s whim, desire, inclination and notion of justice would lead to confusion, disorder and chaos. Indiscriminate and frequent interference under Section 100 C.P.C. in cases which are totally devoid of any substantial question of law is not only against the legislative intention but is also the main cause of huge pendency of second appeals in the High Courts leading to colossal delay in the administration of justice in civil cases in our country.[xiii]
Formulation of Question
A mere mention about the question having been formulated in the memorandum of appeal is not enough.” In a very recent case of Kunjumuhammed vs Mariyumma[xiv], Apex Court held that:
“The Court ought to have formulated substantial question of law and proceeded with the arguments thereafter. A mere mention about the question having been formulated in the memorandum of appeal is not enough. That is not in accord with the settled law. It is possible that more than one question of law had been formulated in the appeal memo, as substantial question of law. The Court ought to advert to the question which it thinks appropriate to examine and then answer the same, as is mandated in terms of the settled legal position.”
In a previous case of Bokka Subba Rao vs. Kukkala Balakrishna[xv] court held that”
“It is now well settled by catena of decisions of this Court that the High Court in second appeal, before allowing the same, ought to have formulated the substantial questions of law and thereafter, to decide the same on consideration of such substantial questions of law.”
More recently in Sreedevi vs. Sarojam[xvi], the Supreme Court had observed that it is obligatory for a High Court to frame substantial question of law in second appeal even if lower courts’ findings are perverse per se. It held that:
“Even on a fair reading of the judgment, we are of the considered opinion that the High Court proceeded to decide the Second Appeal without formulating any substantial question of law, which it ought to have done in view of the mandate of Section 100 of the Code of Civil Procedure, 1908 and the consistent view taken by this Court including in Hardeep Kaur Vs. Malkiat Kaur.[xvii] It was obligatory, to first formulate the appropriate substantial question of law and then deal with the same, after giving an opportunity of hearing to both sides.
However, in a judgment delivered last year Illoth Valappil Ambunhi (D) vs. Kunhambu Karanavan[xviii], the Court observed that mere error in framing a question of law would not render a judgment in Second Appeal liable to be set aside, if it is found that a substantial question of law existed and such question has in fact been answered by the High Court. The question framed in the second appeal in the instant case by the High Court was “whether gift deed having been accepted on behalf of the donee could be revoked by the donor unilaterally?” Supreme Court said perhaps the question should have read whether the finding of the Trial Court with regard to non-acceptance of the deed of gift, confirmed in appeal, was vitiated by perversity and if it was so vitiated, whether the unilateral revocation of the deed, by the donor, can be sustained in law. After a careful reading of the judgment of the High Court under Appeal Apex Court held that it is absolutely clear that those are the questions which have, in effect and substance, been addressed. A mere error in framing a question of law would not render a judgment in Second Appeal liable to be set aside, if it is found that a substantial question of law existed and such substantial question of law has in fact been answered by the High Court as in this case.
No Dismissal on the grounds of Concurrent Findings
Supreme Court recently in Shiv Dayal vs State of Rajasthan[xix] held that a High Court cannot dismiss a second appeal merely on the ground that that there is a concurrent finding of two Courts (whether of dismissal or decreeing of the suit). Court also pointed out that any concurrent finding of the courts can be assailed in High Court if it is proved that such finding was:
- recorded de hors the pleadings or
- based on no evidence or
- based on misreading of material documentary evidence or
- recorded against any provision of law and lastly,
- the decision is one which no Judge acting judicially could reasonably have reached.
Limitations under Section 100 CPC
In Gurnam Singh v. Lehna Singh[xx], Supreme Court once again reminded the High Courts of the limitations under Section 100 CPC and said:
“Despite the catena of decisions of this Court and even the mandate under Section 100 of the CPC, the High Courts under Section 100 CPC are disturbing the concurrent findings of facts and/or even the findings recorded by the First Appellate Court, either without formulating the substantial question of law or on framing erroneous substantial question of law.”
The Court in this case further noticed that:
“While interfering with the judgment and order passed by the first Appellate Court, it appears that while upsetting the judgment and decree passed by the First Appellate Court, the High Court has again appreciated the entire evidence on record, which in exercise of powers under Section 100 CPC is not permissible. While passing the impugned judgment and order, it appears that High Court has not at all appreciated the fact that the High Court was deciding the Second Appeal under Section 100 of the CPC and not first appeal under Section 96 of the CPC.”
So it is very much clear that the jurisdiction of the High Court, in an appeal under Section 100 of the CPC, is strictly confined to the case involving substantial question of law and while deciding the second appeal under Section 100 of the CPC, it is not permissible for the High Court to reappreciate the evidence on record and interfere with the findings recorded by the Courts below and/or the First Appellate Court and if the First Appellate Court has exercised its discretion in a judicial manner, its decision cannot be recorded as suffering from an error either of law or of procedure requiring interference in Second Appeal.
Himachal Pradesh High Court while following the mandate of Apex Court also held that “the scope of interference by the High Court in Second Appeal under Section 100 of the Code of Civil Procedure is only if the Court finds that there is substantial question of law involved in the appeal”.[xxi]
Illustrative Cases of Substantial Question of Law
- Perversity in arriving at a factual finding by Courts below can give rise to a substantial question of law, attracting intervention of the High Court in a Second Appeal filed under Section 100 of the Code of Civil Procedure.[xxii]
- Debatable issue before the High Court which was not covered by settled principles of law and/or precedents.
- Controversy before the High Court with regard to interpretation or legal effect of any document nor any wrong application of a principle of law, in construing a document, or otherwise, which might have given rise to a question of law.
- Disregard or non-consideration of relevant evidence or taking into consideration irrelevant or inadmissible evidence.
- Placing onus of proof on wrong party.
- Disposal of appeal before disposing an application for additional evidence under Order 41 Rule 27.
Illustrative Cases of No Substantial Question of Law
- Concurrent findings of facts recorded by courts below.
- Where two views are reasonably possible.
- Where a new case is sought to be made out in second appeal.
- Where new plea is raised in appeal which is either based on fact, or on mixed question of law and fact or on mere question of law (not on substantial question of law).
- Where the question raised is too general or omnibus in nature.
- Where the High Court feels that reasoning of the first appellate court is not proper.
Conclusion- General Principles
Based on the discussion some general principles relating to Section 100 of the Code of Civil Procedure can be summarized as follows:
- An inference of fact from the recitals or contents of a document is a question of fact, but the legal effect of the terms of a document is a question of law. Construction of a document, involving the application of any principle of law, is also a question of law. Therefore, when there is misconstruction of a document or wrong application of a principle of law in construing a document, it gives rise to a question of law.
- The High Court should be satisfied that the case involves a substantial question of law, and not a mere question of law. A question of law having a material bearing on the decision of the case (that is, a question, answer to which affects the rights of parties to the suit) will be a substantial question of law, if it is not covered by any specific provisions of law or settled legal principle emerging from binding precedents, and, involves a debatable legal issue.
- A substantial question of law will also arise in a contrary situation, where the legal position is clear, either on account of express provisions of law or binding precedents, but the Court below has decided the matter, either ignoring or acting contrary to such legal principle. In the second type of cases, the substantial question of law arises not because the law is still debatable, but because the decision rendered on a material question, violates the settled position of law.
- The general rule is, that High Court will not interfere with the concurrent findings of the Courts below. But it is not an absolute rule. Some of the well-recognised exceptions are where
- the courts below have ignored material evidence or acted on no evidence;
- the courts have drawn wrong inferences from proved facts by applying the law erroneously; or
- the courts have wrongly cast the burden of proof. A decision based on no evidence, does not refer only to cases where there is a total dearth of evidence, but also refers to case, where the evidence, taken as a whole, is not reasonably capable of supporting the finding.
So the primary cause of the accumulation of arrears of second appeal in the High Court is the laxity with which second appeals are admitted without serious scrutiny of the provisions of Section 100 C.P.C. It is the bounden duty of the High Court to entertain second appeal within the ambit and scope of Section 100 C.P.C. and in accordance with the precedents laid down by Apex Court.
[i] Chamber’s 21st Century Dictionary (1997) at p. 59.
[ii] (1931-32) 59 IA 283.
[iii] http://legislative.gov.in/sites/default/files/A1908-05.pdf
[iv] Ganga Bai vs Vijay Kumar, (1974) 2 SCC 393.
[v] Section 100 CPC.
[vi] AIR 1959 SC 57.
[vii] (2007) 7 SCC 363.
[viii] Raghunath Prashad Singh v. Deputy Commissioner of Partabgarh, (1927) 54 1. A. 126, 128.
[ix] Nazir Mohamed vs. J. Kamala, (Civil Appeal Nos. 2843-2844 of 2010).
[x] Chunilal V Mehta & Sons vs Century Spg. & Mfg. Co. Ltd., AIR 1962 SC 1314.
[xi] Supra Note viii.
[xii] Pankaj Bhargava vs Mohinder Nath, (1991) 1 SCC 556.
[xiii] Gurdev Kaur & Ors. Vs Kaki & Ors., SLP (C) No. 20797 of 2003.
[xiv] (Civil Appeal No. 2771 of 2020).
[xv] (2008) 3 SCC 99.
[xvi] CIVIL APPEAL NO. 1302/2019.
[xvii] 2012 (4) SCC 344
[xix] CIVIL APPEAL No.7364 of 2000 and CIVIL APPEAL No.7365 of 2000.
[xviii] CIVIL APPEAL NO. 1429 OF 2011.
[xx] 2019 SCC OnLine SC 374.
[xxi] Satyapal Kashyap v. P.P.S. Chhatwal, 2019 SCC OnLine HP 1561
[xxii] Illoth Valappil Ambunhi (D) vs. Kunhambu Karanavan, CIVIL APPEAL NO. 1429 OF 2011.