Deciding Authority: The Supreme Court of India
Name of the Judges: R.C. LAHOTI & BRIJESH KUMAR
Date of Judgement: 21/01/2002
Facts: An Introductory Statement of bare necessary facts would suffice for the purpose of this order. On 31.10.1987, a contract for sale of immoveable property was entered into between the parties whereby the appellant agreed to sell the suit property consisting of a building and the site on which the building stands, for a consideration of Rs. 40,25,000. An amount of Rs. 8,00,000 was paid by way of advance or earnest money the balance consideration of Rs. 32,25,000 was to be paid simultaneously with the execution and registration of sale deed. This contract was in supersession of an earlier contract dated 22.9.1986 which had lapsed. The vendor had agreed to obtain the requisite permission from the Urban Land Ceiling Authority before 30th June, 1988. The time so appointed could be extended by mutual consent of the parties. It was expressly agreed upon between the parties that if the requisite exemption or permission under the Urban Land (Ceiling and Regulation) Act, 1976 (’ULCRA’. for short) was not forthcoming by 30th June, 1988 or within such extended period as may be mutually agreed to then the contract was to become inoperative and unenforceable in which event the only obligation surviving on the vendor was to refund the earnest money. The vendor could return the earnest money within three months thereafter and if for any reason whatsoever the amount could not be so repaid then the amount was to carry interest at the rate of 12 per cent per annum. It appears that proceedings for declaration that the suit property was within the ceiling limits as appointed by the ULCRA were already pending before the Competent Authority at a point of time when the agreement was entered into between the parties. However, the decision was not forthcoming within the period of six months from the date of the agreement. On 1.12.1998 the appellant wrote a letter to respondent informing that the agreement to sell stands cancelled as per the terms of the agreement for failure of the requisite clearance from the competent authority (Urban Land Ceiling) forthcoming. With the letter the appellant tendered an amount of Rs. 2,00,000 through two cheques enclosed with the letter, requesting for the agreement being returned duly cancelled to the vendor and assuring the payment of the balance amount of the earnest money before the end of December, 1988. This letter erupted a conflict between the parties leading to exchange of legal notices and filing by the respondent of a suit nor specific performance of agreement to sell on 29.6.1989. On 12.3.1992 the Trial Court decreed the suit against which the appellant filed First Appeal before the High Court. On 19.8.1999 the High Court has allowed the appeal, set aside the judgment and decree of the Trial Court and remanded the case for holding additional trial on the three additional issues framed by the High Court and thereafter to decide the case afresh.
Judgement: The main question to be examined is the legality and propriety of the order of remand made by the High Court. Prior to the insertion of Rule 23A in Order 41 of the Code of Civil Procedure by CPC Amendment Act 1976, there were only two provisions contemplating remand by a court of appeal in Order 41 of CPC. In 1976, Rule 23 A has been inserted in Order 41 which provides for a remand by an appellate court hearing an appeal against a decree if (i) the trial court disposed of the case otherwise than on a preliminary point, and (ii) the decree is reversed in appeal and a retrial is considered necessary. On twin conditions being satisfied, the appellate court can exercise the same power of remand under Rule 23A as it is under Rule 23. After the amendment, all the cases of wholesale remand are covered by Rule 23 and 23 A. In view of the express provision of these rules, the High Court cannot have recourse to its inherent powers to make a remand because, as held in Mahendra v. Sushila, AIR (1965) SC 365, at p. 399, it is well settled that inherent powers can be availed of ex debito justiatiate only in the absence of express provisions in the Code. It is only in exceptional cases where the court may now exercise the power of remand de hors the Rules 23 and 23A. An appellate court should be circumspect in ordering a remand when the case is not covered either by Rule 23 or Rule 23A or Rule 25 of the CPC. An unwarranted order of remand gives the litigation an undeserved lease of life and, therefore, must be avoided. In the case before this Court it was not the grievance raised by any of the parties before the High Court that there was any failure on the part of the trial court in discharging its obligation of framing issues. Nobody complained of prejudice at the trial for want of any issue or a specific issue. It was nobody’s case that any evidence, oral or documentary, was excluded or not allowed to be taken on record by the trial court. The very fact that the defendant-appellants have come up to this court laying challenge to the order of remand shows that the appellants are not interested in remand and do not want any additional issue to be framed or to adduce any further evidence. Once of the pleas taken by the appellants in the memo of special leave petition is that the High Court had erred in remanding the matter back for fresh trial and the High Court had failed to appreciate that there was sufficient material on record to show absence of readiness and willingness on the part of the plaintiff to perform its part of the contract. On the other hand, after the passing of the impugned order of remand the plaintiff-respondent has also through his counsel, filed a memo before the trial court on 18.2.2000 submitting that on the additional issues framed pursuant to the direction of the High Court, the evidence on behalf of the plaintiff was already on record and the plaintiff would lead rebuttal evidence only if any evidence was adduced by the defendants. Thus the plaintiff is also not desirous of adducing any additional evidence on the issues. The subsequent events which are material and ought to be noticed by the appellate court are only two i.e. (i) communication of the order of the competent authority (Urban Land Ceiling) holding the land of the appellants to be within ceiling limits, and (ii) order of BIFR holding the plaintiffrespondent to be a sick company. These two events are subject matter of documentary evidence and almost admitted between the parties. The High Court can be requested to take note of such subsequent events by bringing the relevant documents on record which being public documents would not require any formal proof.
Decision:
The appeal is allowed.
Sudipta Bhowmick, 4th Year, B.A. LL.B., School of Law, KIIT University
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