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S.166 - ­Civil P.C. 1908 - S. 96 - Powers of the first Appellate Court- decided the first appeal




Sudarsan Puhan                                                                                 Appellant(s)



Jayanta Ku. Mohanty & Ors.                                                        Respondent(s)


J U D G M E N T Abhay Manohar Sapre, J.

1) These   appeals   are   filed   by   the   appellant­ claimant against the final judgment and order dated 09.11.2015 passed by the High Court of Orissa at Cuttack in M.A.C.A. No.690 of 2014 and M.A.C.A. No.839 of 2014 whereby the High Court allowed the Signature Not Verified appeal filed by the Insurance Company and reduced Digitally signed by ANITA MALHOTRA Date: 2018.09.20 16:51:09 IST Reason:

the   compensation   awarded   by   the   Motor   Accident 
Claims   Tribunal   (in   short   ‘the   Tribunal”)   from Rs.24,62,065/­   to   Rs.20,00,000/­   and   in consequence   dismissed   the   M.A.C.A.   No.690   of 2014 filed by the appellant­claimant in terms of the main order passed in M.A.C.A. No.839 of 2014.

2) In   order   to   appreciate   the   issue   involved   in these appeals, few facts need mention infra.

3) The appellant herein was the claimant before the   Tribunal   whereas   respondent­owner   of   the vehicle (motorcycle) was the non­applicant No.1 and the Insurance Company was non­applicant No.2 in the appellant’s claim petition.

4) On   31.10.2012,   the   appellant­claimant   with one   Dipak   Kumar   Pradhan   was   going   on   a motorcycle bearing No.OR­07 S 3133 from Baisinga to Baripada on National Highway 18 in the State of Orissa.     The   abovesaid   Motorcycle   met   with   an accident   with   a   Mini   Truck   (407)   wherein   the 
appellant­claimant   suffered   severe   injuries.   The motorcycle was owned by Jayanta Kumar Mohanty (respondent   No.1   in   CA   3798/2016   &   respondent No.2   in   CA   No.3799/2016)   and   was   insured   with the   National   Insurance   Company   Ltd.   (respondent No.2   in   CA   3798/2016   &   respondent   No.1   in   CA 3799/2016). 

5) According to the appellant­claimant, he was in the age group of 25­27 years at the time of accident and   suffered   the   disease   of   “paraplegia”   (injury   in spinal cord) as a result of the abovesaid accident. 

6) The appellant­claimant, therefore, filed a claim petition before the Tribunal, Mayurbhanj Baripada (Orissa)   under   Section   166   of   the   Motor   Vehicles Act,   1988  (hereinafter referred to as ‘the MV Act”) against   the   respondents   (owner   of   the   motorcycle and   the   Insurance   company)   and   claimed reasonable compensation for the injuries sustained 
by   him   and   other   statutory  compensation   payable under   the   MV   Act   for   causing   such   injuries.   The respondents contested the claim petition.

7) By   award   dated   17.05.2014,   the   Tribunal allowed   the   appellant’s   claim   petition   in   part   and holding   the   respondents(non­applicants)   liable   for payment   of   the   compensation   to   the   appellant­ claimant jointly and severely awarded a total sum of Rs.24,62,065/­ with interest payable at the rate of 7% per annum under various heads.

8) The   appellant­claimant   and   the   Insurance Company   both   felt   aggrieved   by   the   award,   filed appeals in the High Court of Orissa at Cuttack.  

9) So far as M.A.C.A.No.690/2014 is concerned, it   was   filed   by   the   appellant­claimant   for enhancement   of   the   amount   awarded   by   the Tribunal whereas so far as M.A.C.A.No.839/2014 is concerned, it was filed by the Insurance Company
against the award challenging therein the quantum of compensation to be on a higher side. 

10) By   impugned   order,   the   High   Court   allowed the   appeal   filed   by   the   Insurance   Company (M.A.C.A.No.839/2014)   in   part   and   accordingly reduced   the   compensation   from   Rs.24,62,065/­   to Rs.20,00,000/­.     As   a   result   of   the   main   order passed in favour of the Insurance Company in their appeal,   the   appeal   filed   by   the   appellant­claimant (M.A.C.A.   No.690/2014)   seeking   enhancement   in the   quantum   of   compensation   was   dismissed   as having rendered infructuous. 

11) The   appellant­claimant   felt   aggrieved   by   the order of the High Court filed two appeals by way of special leave in this Court. One is filed against an order   by   which   the   claimant’s   appeal   for enhancement in the quantum of compensation was dismissed as having rendered infructuous and the 
other   is   filed   against   an   order   by   which   the Insurance Company’s appeal was partly allowed by reducing   the   quantum   of   compensation   from Rs.24,62,065/­ to Rs.20,00,000/­.

12) It   may   be   mentioned   that   so   far   as   the Insurance   Company   is   concerned,   they   have   not filed any appeal against the order of the High Court. In   other   words,   the   Insurance   Company   seems satisfied with the quantum of compensation amount of Rs.20,00,000/­awarded by the High Court by the impugned order.

13) The   short   question,   which   arises   for consideration in these two appeals, is whether the High Court was justified in allowing the Insurance Company's   appeal   (M.A.C.A.   No.839/2014)   and was, therefore, justified in  reducing the quantum of compensation   amount   from   Rs.24,62,065/­   to Rs.20,00,000/­  and, in  consequence,  was justified 
in     dismissing   the   claimant’s   appeal   for enhancement   of   the   quantum   of   compensation   as having rendered infructuous.

14) Learned   counsel   for   the   appellant­claimant while   assailing   the   legality   and   correctness   of   the impugned   order   contended   that   the   High   Court without   adverting   to   any   factual   and   legal   issue arising   in   the   case   simply   allowed   the   Insurance Company’s   appeal   and   reduced   the   compensation from Rs.24, 62,065/­ to Rs.20,00,000/­ awarded by the   Tribunal   and,   in   consequence,   dismissed   the appellant­claimant’s appeal in a cryptic manner.

15) According to learned counsel, the High Court neither set out the facts, nor dealt with any issue, nor   appreciated   the   ocular   and   documentary evidence   much   less   in   its   proper   perspective,   nor examined   the   legal   principles   applicable   to   the issues   arising   in   the   case   and   nor   rendered   its 
findings on any contentious issues decided by the Tribunal   except   to   observe  “Considering   the submissions  of the learned  counsel for the  parties” and   “I   feel,   the   interest   of   justice   would   be   best served   if   the   awarded   compensation   amount   of Rs.24,62,065/­   is   modified   and   reduced   to Rs.20,00,000/­”.  

16) Learned   counsel   for   the   appellant   submitted that   it   was   not   the     consideration   of   the   case   of either parties at all and yet the Insurance Company succeeded   in   their   appeal   and   appellant­claimant lost which caused prejudice to him due to reduction in quantum of compensation. 

17) Learned counsel further contended that it was the   duty   of   the   High   Court   exercising   its   first appellate powers under Section 173 of the M.V. Act to have dealt with all the submissions urged by the parties   and   after   appreciating   the   entire   evidence 
should have come to its own conclusion one way or the   other   keeping   in   view   the   legal   principles governing   the   issues   as   to   whether   any   case   was made out for enhancement or reduction in quantum of compensation, as the case may be.  It was urged that   since   it   was   not   done   by   the   High   Court,   a jurisdictional error is committed which renders the impugned order legally unsustainable. 

18) Lastly,   the   learned   counsel   urged   that   if   his arguments are accepted, the remand of the case to the   High   Court   to   decide   the   appeal   filed   by   the appellant­claimant alone on merits is inevitable.

19) Learned   counsel   for   the   respondents (Insurance   Company),   however,   supported   the impugned orders and urged that they do not call for any interference.

20) Having   heard   the   learned   counsel   for   the parties and on perusal of the record of the case, we
find force in the submissions of the learned counsel for the appellant­claimant. 

21) The   powers   of the first Appellate Court while deciding the first appeal are indeed well defined by various judicial pronouncements of this Court and are, therefore, no more res integra. 

22) 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   Code   of   Civil   Procedure, 1908 (hereinafter referred to as “the Code”) Kurian Chacko vs. Varkey Ouseph,  AIR 1969 Kerala 316, reminded   the   first   appellate   court   of   its   duty   to decide   the   first   appeal.   In   his   distinctive   style   of writing with 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   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)

23) This Court also in various cases reiterated the aforesaid principle and laid down the powers of the Appellate Court under Section 96 of the Code while deciding the first appeal.

24) We consider it apposite to refer to some of the decisions.  

25) In  Santosh Hazari  vs.  Purushottam Tiwari (Deceased) by L.Rs. (2001) 3 SCC 179, this Court held (at pages 188­189) 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…………” 

26) The above view was followed by a three­Judge 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.

27) 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.”

28) Again   in  Jagannath  v.  Arulappa   &   Anr., (2005) 12 SCC 303,  while considering the scope of Section 96 of the Code, this Court (at pp. 303­04) observed as follows: (SCC para 2) “2.   A   court   of   first   appeal   can   reappreciate   the entire   evidence   and   come   to   a   different conclusion……...”

29) 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   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.”

30) 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 174 and Uttar   Pradesh   State   Road   Transport Corporation vs. Mamta & Ors. (2016) 4 SCC 172.

31) An appeal under Section 173 of the M.V. Act is essentially in the nature of first appeal alike Section 96   of   the   Code   and,   therefore,   the   High   Court   is equally   under   legal   obligation   to   decide   all   issues arising   in   the   case   both   on   facts   and   law   after appreciating   the   entire   evidence.     [See  National Insurance   Company   Ltd.  vs.  Naresh   Kumar   & Ors.  ((2000) 10 SCC 198 and  State of Punjab & Anr. vs. Navdeep Kuur & Ors. (2004) 13 SCC 680].

32) As observed supra, as a first Appellate Court, it was the duty of the High Court to have decided the   appeals   keeping   in   view   the   requirements   of Order XX Rule 4 (2) read with Order XLI Rule 31 of the Code which requires that judgment/order shall 
contain a concise statement of the case, points for determination, decisions thereon and the reasons. 

33) Coming now to the facts of the case at hand, we consider it appropriate to reproduce the order of the High Court infra:

“Considering   the   submissions   made   by   the learned   counsel   for   the   parties   and   keeping in   view   the   quantum   of   compensation amount awarded and the basis on which the same has been arrived at I feel, the interest of justice would be best served if the awarded compensation   amount   of   Rs.24,62,065/­   is modified   and   reduced   to   Rs.20,00,000/­ which is payable to the claimant along with the awarded interest. The impugned award is modified to the said extent.

The   appellant­Insurance   Company   is directed   to   deposit   the   modified compensation   amount   of   Rs.20,00,000/­ along with awarded interest with the learned Tribunal within six weeks hence.  On deposit of the amount, the same shall be disbursed to the   claimant   proportionately,   as   per   the direction of the learned Tribunal given in the impugned award. ”

34) Mere perusal of the afore­quoted order of the High Court would show that the High Court neither set out the facts of the case of the parties in detail, 
nor dealt with any of the submissions urged except to   mention   them,   nor   took   note   of   the   grounds raised by the claimant and nor made any attempt to appreciate   the   evidence   in   the   light   of   the   settled legal   principles   applicable   to   the   issues   arising   in the case and proceeded to allow the appeal filed by the   Insurance   Company   and   reduced   the compensation   from   Rs.24,62,065/­   to Rs.20,00,000/­.

35) The High Court only observed “Considering the submissions   of   the   learned   counsel   for   the   parties” and   “I     feel  that   compensation   should   have   been awarded   as     Rs.20,00,000/­   and     not Rs.24,62,065/­“. No reasons were given by the  High Court   as   to   why   the   amount   of   compensation should   be   reduced   from   Rs.24,62,065/­   to Rs.20,00,000/­   and   why   it   cannot   be   enhanced. Since   the   appellant­claimant  had   also  filed  appeal 
for   enhancement   of   the   compensation,   the   entire controversy was again open for decision before the High   Court   at   the   instance   of     the   claimant   and Insurance   Company.     It   was,   therefore,   necessary for   the   High   Court   to   assign   the   reasons   for   not granting   enhancement   of  compensation   and/or  its reduction.   In the  absence of any reasons, we are unable to uphold the impugned orders of the High Court. 

36) As mentioned above, the Insurance Company did not choose to file any special leave to appeal in this Court against the impugned order of the High Court. The effect of non­filing of appeal is that the Insurance   Company   has   in   principle   accepted   the High Court’s order.

37) This   Court   having   allowed   the   claimant’s appeal   and   setting   aside   the   impugned   order,   it results   in   dismissal   of   the   appeal   filed   by   the
Insurance Company (M.A.C.A. No.839 of 2014) and allowing  of the appeal (M.A.C.A.No.690/2014) filed by the claimant.    Had the Insurance Company filed special leave to appeal against the impugned order in   this   Court   seeking   further   reduction   in   the compensation awarded by the High Court  like what the   Insurance   Company   did   when   they   had   filed appeal before the High Court questioning  inter alia the quantum of compensation being on higher side, the   Insurance   Company   too   would   have   been entitled   to   prosecute   their   appeal   on   merits   after remand before the High Court in terms of this order. It   was,   however,   not   done   by   the   Insurance Company.  

38) In   this   view   of   the   matter,   the   appellant­ claimant   alone   will   have   a   right   to   prosecute   his appeal (M.A.C.A. No.690 of 2014) on merits before the   High   Court   after   remand   of   the   case   by   this 
Court   wherein   the   High   Court   will   examine   the question   as   to   whether   any   case   for   further enhancement   in   the   quantum   of   compensation awarded by the Tribunal is made out or not and, if so, on what grounds.  

39) In view of the foregoing discussion, we remand only   the   appellant­claimant’s   appeal   (M.A.C.A. No.690 of 2014) to the High Court for deciding the question   as   to   whether   any   case   is   made   out   for further enhancement from Rs.24,62,065/­ awarded by   the   Tribunal   and,   if   so,   on   what   grounds. Needless to say, the Insurance Company will have a right  to oppose  the appellant­claimant’s appeal on the merits.

40) However,   we   make   it   clear   that   we   have   not applied   our   mind   to   the   merits   of   the   issues involved   in   the   case   having   formed   an   opinion   to remand the case to the High Court and hence the 
High   Court   would   decide   M.A.C.A.   No.690/2014 strictly   in   accordance   with   law   on   merits uninfluenced   by   any   of   our   observations.     We request   the   High   Court   to   decide   the   appeal preferably within six months.

41) The appeals thus succeed and are accordingly allowed in part. The impugned orders are set aside. No costs.