Orissa High Court
Orissa State Financial Corporation vs Jyoti Prakash Das on 11 November, 2024
ORISSA HIGH COURT : CUTTACK
CRP No.30 of 2023
In the matter of an Application under
Section 115 of the Code of Civil Procedure, 1908
***
Orissa State Financial Corporation
(Incorporated under
the State Financial Corporation Act, 1951)
having its Office at OMP Square, Cuttack
Represented by
Managing Director
Orissa State Financial Corporation
Cuttack. ... Petitioner
(Petitioner-defendant No.5
in the trial Court).
-VERSUS-
Jyoti Prakash Das
Aged about 75 years
Son of Late Satyabadi Das
At: Shaikh Bazar
P.O.: Tulasipur
P.S.:Lalbag
Town/District: Cuttack. ... Opposite party
(Opposite party-plaintiff
in the trial Court).
Counsel appeared for the parties:
For the Petitioner : M/s. Abinash Routray,
J. Bhuyan, A. Routray and
P.K. Jena, Advocates
CRP No.30 of 2023 Page 1 of 88
For the Opposite party : M/s. Darpahari Dhal,
Khetra Mohan Dhal,
Manoj Kumar Sahoo,
Amiya Kumar Satpathy,
Budhimanta Swain, and
Nityabrata Behuria, Advocates
P R E S E N T:
HONOURABLE
MR. JUSTICE MURAHARI SRI RAMAN
Date of Hearing : 17.09.2024 :: Date of Judgment : 11.11.2024
J UDGMENT
Questioning the legality and propriety of the Order dated
15.07.2023 passed in CMA No.145 of 2021 (arising out
of Execution Petition No.03 of 2012) by the learned 2nd
Additional Senior Civil Judge, Cuttack rejecting the
prayer of the petitioner-the judgment debtor (defendant
No.5), namely, Orissa State Financial Corporation (for
convenience, "OSFC") to drop the execution proceeding,
this civil revision petition has been filed craving to
exercise power under Section 115 of the Code of Civil
Procedure, 1908, ("CPC", for short) with the following
prayer(s):
―The petitioner, therefore, prays that this Hon'ble Court
may be graciously pleased to admit the revision, call for
the records from the Court below and upon hearing the
impugned Order dated 15.07.2023 passed in CMA
CRP No.30 of 2023 Page 2 of 88
No.145 of 2021 be set aside and the revision be allowed
with cost throughout.‖
Facts:
2. The case in nutshell is that the opposite party herein as
plaintiff filed a suit bearing TMS No.747 of 1989 for
grant of decree for an amount of Rs.1,70,000/- along
with pendente lite interest and future interest at the rate
of 18% per annum in his favour against the following
defendants:
―1. M/s. Trimurti Hotel Limited,
having its Regd. Office and
Hotel Building at Link Road,
Badambadi, P.S.: Madhupatana,
District: Cuttack.
2. Pitchu Iyer Appa Durai,
Son of late Pitchu Durai
Permanent resident of 24, R.N. Mukharjee Road.,
Calcutta-700001,
At/Pr. residing at Trimurti Hotel Building,
At: Link Road, Badambadi, Cuttack
One of the Directors of Trimurti Hotels Limited,
Defendant No.1, representing the said defendant
No.1.
3. Trinath Choudhury,
At present residing at Panda Colony,
Engineering School Chhak, Lanjipali
Berhampur, District Ganjam, Orissa,
One of the Directors of Trimurti Hotel Limited,
Representing the defendant No.1.
4. Hotels Virgo Private Limited,
having its office at present
At Trimurti Hotel Building,
CRP No.30 of 2023 Page 3 of 88
At: Link Road, Badambadi, Cuttack
Represented through its one of the Directors,
Pitchu Iyer Appa Durai @ Appa Duari,
Son of Late Pichu Iyer of
24, R.N. Mukharjee Road, Calcutta-700001,
West Bengal,
At/Pr. Trimurti Hotel Building,
At Link Road, Badambadi, Cuttack.
5. Orissa State Financial Corporation,
Incorporated under the Orissa State Financial
Corporation Act having
Office at O.M.P. Square, Cuttack-3
Cuttack, represented through
Managing Director
having his Office in the above address.
6. Industrial Promotion and Investment Corporation
of Orissa Limited,
having its Office at Janapath, Bhubaneswar,
District: Puri
represented through its Managing Director
having his office in the above Address.‖
2.1. In the proceeding while all the defendants were set ex
parte except defendant Nos.5-OSFC and 6 (Industrial
Promotion and Investment Corporation of Orissa
Limited) who participated and contested and judgment
and decree dated 24.12.2011 were passed by the learned
2nd Additional Senior Civil Judge, Cuttack with the
following order:
―The suit, be and the same, is decreed on contest against
the defendants and under the circumstances the
defendants are liable to pay litigation cost of Rs.20,000/-
at the least to the plaintiff. The defendants are also
liable jointly and severally to pay Rs.1,70,000/- with
CRP No.30 of 2023 Page 4 of 88
15% commercial interest along with Pendente lite
Interest & Future Interest from the date of the last
part supply made in 1983-84 till its realisation to
the plaintiff in three equal monthly instalments
within three months hence. The other prayer to recover
back the goods supplied and installed in defendant's unit
by the plaintiff is also allowed as an alternative remedy.
In case of failure by the defendants to make payment of
the dues to the plaintiff as directed above, the plaintiff
can realise the same or enforce the alternative remedy
through the process of the Court. Pleaders' fee be
assessed at the contested scale.‖
2.2. The defendant No.6, namely, Industrial Promotion and
Investment Corporation of Orissa Limited (IPICOL)
preferred an appeal under Section 96 of the CPC,
registered as RFA No.34 of 2012, before the Court of the
learned District Judge, Cuttack which came to be
disposed of vide Judgment dated 19.07.2013. The
appellate Court in paragraph 5 of the said judgment took
note of fact that the learned trial Court had framed as
many as five issues, out of which one of the issues, viz.,
issue No.3, was "whether the defendants are jointly and
severally liable to pay the outstanding amount of the
plaintiff with interest including pendente lite interest and
future interest?‖.
2.3. At paragraph No.6 of the said judgment, the observation
of the appellate Court was as follows:
CRP No.30 of 2023 Page 5 of 88
―6. While answering issue No.3, the trial Court has
mostly relied on the following facts.
(i) One of the officials of Industrial Promotion and
Investment Corporation of Orissa Limited was the
Director (Finance) in defendant No.1's Company.
(ii) The Industrial Promotion and Investment
Corporation of Orissa Limited has directly paid
Rs.30,000/- to the Plaintiff acknowledging him as
sundry creditor.
(iii) The Director (Finance), S.B. Satpathy who was an
Officer of Industrial Promotion and Investment
Corporation of Orissa Limited vide Exts.11 and 12
had acknowledged the dues of the plaintiff
outstanding against ―Trimurti Hotels Limited‖ and
had assured to clear the dues after financial
arrangement.
(iv) A sub-committee comprising the members from
defendant No.1, defendant Nos.5 & 6 was
constituted to finalize the scrutinization process to
make payment of sundry creditors, but no
scrutinization was made to finalize the dues of
sundry creditors and, therefore, the Orissa State
Financial Corporation and Industrial
Promotion and Investment Corporation of
Orissa Limited did not discharge their duty
properly resulting in financial loss to the
sundry creditors.
(iv) The defendant Nos.5 and 6 were controlling the
affairs of "Trimurti Hotels Ltd." and, therefore,
though there was no express contract between
the sundry creditors and defendant Nos.5 and
CRP No.30 of 2023 Page 6 of 88
6, but still then they are liable to clear the
unpaid dues of the sundry creditors and the
plaintiff is one of the sundry creditors.
(vi) The defendant No.5 has not stated at what price the
auction sale was made or finalized through One
Time Settlement and how the balance amount, if
any, was utilized to protect the interest of the sundry
creditors and the defendant Nos.5 and 6 have acted
arbitrarily.‖
2.4. Having taken cognizance of findings recorded by the trial
Court, the appellate Court in RFA No.34 of 2012 vide
Judgment dated 19.07.2013 came to the following
conclusion:
―***
7. Learned counsel for the appellant has submitted
that Industrial Promotion and Investment
Corporation of Orissa Limited is a wholly owned
Government of Orissa Undertaking incorporated
under the provisions of the Companies Act with the
main object of promoting and financing large and
medium scale Industries in the State. Both the
Orissa State Financial Corporation and Industrial
Promotion and Investment Corporation of Orissa
Limited had financed the defendant No.1 i.e., M/s.
Trimurti Hotels Limited for setting up the Hotel at
Link Road, Cuttack and the project started in 1978
and by March, 1983 partial operation of the Hotel
had started, but thereafter the defendant No.1 again
requested for additional finance assistance of term
loan to discharge the dues of the sundry creditors
and to complete the balance work. While sanctioning
CRP No.30 of 2023 Page 7 of 88
the term loan in the month of August, 1983, the
appellant stipulated that one of his Officer-nominee
will be in the Board of Directors of the Hotel to
function as the Director (Finance) and shall be the
joint signatory to operate the Bank account of
defendant No.1 and this arrangement was made to
safeguard the interest of Industrial Promotion and
Investment Corporation of Orissa Limited to secure,
refund of loan advanced to defendant No.1. By
August, 1983, the plaintiff-respondent No.1 had
already supplied electrical goods and installation of
hotel and by then, the official of Industrial Promotion
and Investment Corporation of Orissa Limited was
not the Director (Finance) of the Hotel. Only on the
basis of Resolution dated 18.10.1983 of the Board of
Directors of the Hotel, Industrial Promotion and
Investment Corporation of Orissa Limited had paid
Rs.30,000/- directly to the Indian Commercial
complex, i.e., the plaintiff on 01.11.1983 out of the
additional term loan, but, that does not mean that he
had acknowledged to clear the entire outstanding
dues of the plaintiff. A sub-committee was
constituted with the members of defendant
Nos.1, 5 and 6 to finalize the amount payable
to sundry creditors, but due to lack of interest
shown by the promoter-directors of the
Company, the amount payable to the sundry
creditors could not be finalized. He has further
submitted that Exts.11 and 12, on which the
respondent No.1 is relying, were not issued by S.B.
Satpathy, Director (Finance), as an official of
Industrial Promotion and Investment Corporation of
Orissa Limited, but those were issued in the letter
pad of ―Trimurti Hotels Limited‖ as the Finance
Director of the said Hotel and it will not bind
CRP No.30 of 2023 Page 8 of 88
Industrial Promotion and Investment Corporation of
Orissa Limited in any way to discharge the dues of
the plaintiff, I find these submissions of the learned
counsel for the appellant to be correct.
8. It is in the evidence that in spite of the additional
financial assistance given by Industrial Promotion
and Investment Corporation of Orissa Limited, the
Hotel became sick and could not discharge the debt
of Orissa State Financial Corporation and Industrial
Promotion and Investment Corporation of Orissa
Limited and, therefore, ultimately on 11.09.1985,
Orissa State Financial Corporation seized the Hotel
Unit under Section 29 of the State Financial
Corporation Act, 1951 and the Disposal Advisory
Committee of Orissa State Financial Corporation
decided in favour of offer for sale of the property to
M/s. Virgo International Private Limited. The
Industrial Promotion and Investment Corporation of
Orissa Limited and Orissa State Financial
Corporation are secured creditors of Respondent
No.2 and all the assets and materials of the unit
was hypothecated in their favour and, therefore,
after sale of the unit under Section 29 of the S.F.C.
Act, 1951, the sale proceeds were apportioned by
the Orissa State Financial Corporation and
Industrial Promotion and Investment Corporation of
Orissa Limited and nothing was left for payment to
the sundry creditors. Plaintiff has admitted that
there was no contract between the plaintiff and the
defendant Nos.5 and 6, i.e., Orissa State Financial
Corporation and Industrial Promotion and
Investment Corporation of Orissa Limited while
electrical goods and installation were supplied to the
defendant No.1 M/s. Trimurti Hotels Limited. One
CRP No.30 of 2023 Page 9 of 88
Officer of Industrial Promotion and Investment
Corporation of Orissa Limited was functioning as the
Director (Finance) of M/s. Trimurti Hotels Limited
only after the additional financial assistance in
shape of term loan given by Industrial Promotion
and Investment Corporation of Orissa Limited and
he had only supervisory authority, so that the
finance made by Industrial Promotion and
Investment Corporation of Orissa Limited to M/s.
Trimurti Hotels Limited is secured. He had not
acknowledged or assured the plaintiff to clear the
outstanding dues as an Officer of Industrial
Promotion and Investment Corporation of Orissa
Limited, but vide Exts.11 and 12, he had assured
the Plaintiff to clear his dues after obtaining finance
from the financial institutions, as finance Director of
M/s. Trimurti Hotels Limited. There is no evidence on
record to show that Industrial Promotion and
Investment Corporation of Orissa Limited was
controlling the financial affairs of defendant No.1's
Company. There was no privity contract
between the plaintiff and the defendant Nos.5
and 6 when he supplied the electrical goods to
M/s. Trimurti Hotels Limited and, therefore, the
appellant cannot be held jointly and severally
liable to clear the outstanding dues of the
plaintiff. Accordingly, the appeal preferred by the
appellant succeeds. Hence, it is ordered.
ORDER
The appeal is allowed on contest against the respondent No.1 and ex parte against the other respondents. The judgment and decree passed against the present appellant is only set aside, CRP No.30 of 2023 Page 10 of 88 but will remain as such against the other defendants. In the facts and circumstances of the case, the parties are to bear their own costs.‖ 2.5. Against the said judgment of the Appellate Court setting aside the judgment and decree passed against the IPICOL, the present opposite party (Jyoti Prakash Das) invoking provisions of Section 100 of the Code of Civil Procedure, 1908, approached this Court by filing second appeal bearing RSA No.373 of 2013, which came to be disposed of vide Judgment dated 08.09.2016, wherein this Court observed as follows:
―***
6. Learned counsel for the appellant (Jyoti Prakash Das-present opposite party) submits that the followings are the substantial questions of law:
(1) Whether the learned lower appellate Court has committed gross error of law in arriving at a conclusion that the defendant No.6 is only the supervisory authority in view of the fact that the evidence on record show that IPICOL was controlling the financial affair of the company?
(2) Whether the learned lower appellate Court committed gross error of law by holding that Ext.11 and 12 cannot be treated as an acknowledgement of the liability on the part of the defendant No.6 to clear the outstanding dues of plaintiff.CRP No.30 of 2023 Page 11 of 88
(3) Whether the learned lower appellate Court committed gross error of law by not holding that the plaintiff being a creditor, by the resolution of the Board of Directors, defendant No.6 is liable to pay the outstanding dues?
***
8. Admittedly, by August, 1983 the plaintiff had supplied electrical goods and done the electric installation work in the hotel and by then the official of this defendant No.6 was not the Director of Finance of the company running the hotel. Similarly, the payment said to have been made by this defendant No.6 is by virtue of a resolution of the Board of Directors passed on 18.10.1983 and that too the said amount has been paid from out of the additional term loan sanctioned to the company running the hotel. So, this cannot be taken to be an acknowledgment of the liability for payment of the outstanding dues of the plaintiff by defendant No.6, the financer.
Facts remain that despite additional financial assistance given by the financier, hotel still remained sick and failed to discharge the debt of defendant Nos.5 & 6. Therefore, action under section 29 of the State Financial Corporation Act has been taken and ultimately there has been the sale of the unit. All the assets and materials of the unit having remained hypothecated in favour of defendant nos.5 & 6, the sale proceeds obtained by sale of the unit has been accordingly apportioned.
There was no contract between the plaintiff and this defendant No.6 for supply of electrical CRP No.30 of 2023 Page 12 of 88 goods and for entrustment of the work of electrical installation in the hotel. The position of this defendant No.6 being that of a financer, in my considered view, has nothing to do with the liability of the plaintiff in making payment of outstanding dues for supply of electrical goods and doing the electrical installations in the said hotel which was then being not run by it.
9. Thus, I find that the lower appellate Court has addressed the questions raised in so far as the liability of the defendant No.6 is concerned in accordance with law in rightly holding that the defendant No.6 has no liability in the matter of payment of money to the plaintiff. The lower appellate court is thus found to have rightly allowed the appeal filed by this defendant No.6 and to the extent as aforesaid.
The submission of the learned counsel for the appellate in view of above discussion and reason is not accepted. This Court thus finds that there arises no substantial question of law in this appeal for being answered. The appeal thus does not merit admission.
10. The appeal is accordingly dismissed. No order as to cost.‖ 2.6. After disposal of the said RSA No.373 of 2013 a petition, being Misc. Case No.950 of 2016, filed at the instance of the opposite party for modification/clarification of the Judgment dated 08.09.2016, got disposed of by this CRP No.30 of 2023 Page 13 of 88 Court vide Order dated 15.11.2017 with the following order:
―This application has been filed by the appellant for modification/clarification of the judgment dated 08.09.2016 passed in RSA No.373 of 2013 in so far as the liabilities of defendants other than defendant No.6 are concerned.
Heard learned counsel for the appellant. Gone through the judgment of this Court as well as the first appellate court in RFA No.34 of 2012 arising out of the judgment and decree passed by the trial Court in TMS No.74 of 1989.
The first appeal had been filed by the defendant No.6 and the judgment and decree passed by the trial court had been set aside in so far as the liability of the defendant No.6, the appellant therein is concerned which appears to have been stated in the said judgment in clear terms.
The second appeal had been filed by the plaintiff questioning said finding and decision of the first appellate court particularly in respect of the declaration that the defendant No.6 has no liability in the matter of the claim of the plaintiff. The appeal has been dismissed by this Court holding the first appellate court to have rightly allowed the appeal preferred by the defendant No.6 holding it to be having no liability.
The subject matter of challenge in the second appeal was that of exoneration of defendant No.6 from its liability in satisfying the claim of the plaintiff as decreed. So when the second appeal has been dismissed holding that it does not merit admission, I am unable to find out any reason behind the move for such further modification/clarification in the matter.
CRP No.30 of 2023 Page 14 of 88It is needless to say that the second appeal since has been dismissed without admission, the judgment and decree as passed by the first appellate court which has marched over the judgment and decree passed by the trial court to the extent as found therein, holds the field.
The Misc. Case stands accordingly disposed of with the above observation. Issue urgent certified copy as per rules.‖ 2.7. Before the executing Court in connection with the decree pursuant to judgement dated 24.12.2011 of the 2nd Additional Senior Civil Judge, Cuttack, the judgment- debtor (OSFC) filed CMA No.145 of 2021 with prayer to drop the execution proceeding by contending that being similarly situated as that of the IPICOL (financier), identical benefit must be extended to it in terms of the judgment dated 08.09.2016 of this Court in RSA No.373 of 2013 wherein it was observed that the IPICOL as Financier has nothing to do with the liability of the opposite party (plaintiff-decree holder) with respect to supply of electrical goods and execution of electrical installation in M/s. Trimurti Hotels Limited.
2.8. Before the executing Court, refuting the claim of the petitioner, the opposite party urged that had the OSFC been sanguine about its right and prejudice, it would have approached by way of an appeal, as was done by the IPICOL, or made an application for review under CRP No.30 of 2023 Page 15 of 88 Order LXVII of the CPC or in the alternative, it could have moved a petition under Order IX, Rule 13 of the CPC. It is pleaded that decree cannot be ignored merely because it is claimed to be contrary to law on the basis of principle as set at rest that the executing Court cannot go behind the decree unless a decree is declared to be nullity by a competent Court of law.
2.9. It is specifically objected to by the opposite party that the judgment-debtor, having participated in the suit as defendant No.5 and contested by participating in the proceeding, it can at no stretch of imagination be conceived that the judgment and decree of the trial Court was not within its knowledge.
2.10. Refuting the allegations made by the judgment-debtor, the decree holder (opposite party herein) submitted that it is fallacious ground to raise objection that the decree is inexecutable. It is stated that it is too late in the day to raise dispute with regard to judgment and decree passed by the 2nd Additional Senior Civil Judge, Cuttack.
2.11. Considering the factual position with regard to finality attached to the judgment and decree passed by the learned 2nd Additional Senior Civil Judge, Cuttack in the suit qua the defendant No.5 (OSFC), as it did not choose to assail before the appellate Court. Therefore, the petitioner is required to discharge its liability as per the CRP No.30 of 2023 Page 16 of 88 decree. The learned 2nd Additional Senior Civil Judge, Cuttack has made the following observation:
―***
4. Heard, from both the sides. Perused the case record.
The present petitioner has prayed to drop the execution proceeding against him on the ground that as the present petitioner is nowhere liable to pay. The present petitioner has filed this CMA under Section 47 of CPC going to the merits of the case. Both in the judgments passed in TMS No.747/1989 and RFA No.34/12, the present petitioner has been held liable.
It is the settled principle of law that, ‗Executing Court can neither travel behind the decree nor sit in appeal over the same or pass any order jeopardizing the rights of the parties there under. It is only in the limited cases where the decree is by a Court lacking inherent jurisdiction or is a nullity that the same is rendered non est and is thus in- executable. An erroneous decree cannot be equated with one which is a nullity. It can be challenged on the ground of jurisdiction infirmity, voidness or the same is void ab initio and is a nullity, apart from the ground that it is not capable of execution under the law, either because the same was passed in ignorance of such provision of law or the law was promulgated making a decree inexecutable after its passing.' [2018 (I) CLR 546] In the present case at hand, the petitioner has prayed to drop the execution proceeding on the ground that the present petitioner is not liable and CRP No.30 of 2023 Page 17 of 88 hence the decree cannot be executed against the present petitioner. The execution is not challenged on any ground of infirmity as discussed above.
In view of the discussion made above, the execution cannot be dropped against the present petitioner in absence of any infirmity in the decree already passed. Hence, ordered:
ORDER The CMA be and the same is dismissed on contest against the OP but under the circumstances without any cost.‖ 2.12. Aggrieved thereby, the petitioner-OSFC has preferred this civil revision petition before this Court invoking Section 115 of the CPC.
Hearing:
3. Pleadings being completed and exchanged, on consent of counsel for the respective parties, this matter is taken up for final hearing at the stage of admission.
3.1. Heard Sri Abinash Routray, learned Advocate for the petitioner and Sri Khetra Mohan Dhal, learned counsel appearing for the opposite party and the matter stood reserved for preparation and pronouncement of order.
Submissions and arguments:
4. Sri Abinash Routray, learned counsel for the petitioner submitted that the petitioner has raised pertinent CRP No.30 of 2023 Page 18 of 88 question touching the jurisdiction of the executing Court to proceed with the execution of the decree inasmuch as the same is not executable against the present petitioner in the teeth of the judgment dated 08.09.2016 rendered by this Court in RSA No.373 of 2013 filed by the present opposite party (Jyotiprakash Das Vrs. IPICOL and others).
4.1. It is vehemently contended by the learned counsel for the petitioner that in the aforesaid judgment, inasmuch as this Court absolved the IPICOL from discharging liability in terms of decree in the suit in absence of privity of contract between the IPICOL (arrayed as opposite party No.6 in the suit) and the present opposite party, thereby no liability could be fastened to IPICOL, in the similar fashion the petitioner-OSFC for supply of electrical goods and execution of installation works in the hotel cannot be compelled to discharge liability as contained in the same decree. It is submitted that the liability of the hotel (remained sick) for work executed by the opposite party could not be shifted on to the defendant No.5 (OSFC) and No.6 (IPICOL), which renders the decree a void one.
4.2. He drew attention of this Court to the finding reflected by this Court in the said judgment in RSA No.373 of 2013 to the effect that action under Section 29 of the State Financial Corporation Act was taken against the hotel and ultimately the unit was sold. Therefore, all the CRP No.30 of 2023 Page 19 of 88 assets and materials of the unit having remained hypothecated in favour of defendant Nos.5 and 6, the sale proceeds on account of sale of the unit have accordingly been apportioned.
4.3. Expanding his argument further, learned counsel for the petitioner submitted that since this Court aptly held that the IPICOL, being financier, cannot be fastened with liability to make payment of money to the plaintiff-decree holder, the executing Court should have gone into the aspect whether the decree, if at all, is capable of being executed against the OSFC inasmuch as the IPICOL has already been adjudged as having no liability to discharge towards decree in favour of the opposite party. Accordingly the executing Court should have dropped the execution proceeding.
5. Sri Khetra Mohan Dhal, learned Advocate appearing for the opposite party-plaintiff in trial Court, per contra, opposed such a contention of the learned counsel for the petitioner and proceeded to submit that the executing Court was justified in dismissing the petition seeking for dropping the execution proceeding. The trial Court while concluding the suit held that the defendants including the OSFC, which was the contesting defendant in the suit before the trial Court, was liable to pay Rs.1,70,000/- along with 15% commercial interest along with pendente lite and future interest from the date of CRP No.30 of 2023 Page 20 of 88 the last part supply made in 1983-84 till its realisation. Having not questioned the veracity of such judgment and decree passed by the learned 2nd Additional Senior Civil Judge, Cuttack, qua the present petitioner vis-à-vis the opposite party, the terms of decree in TMS No.747 of 1989 has attained finality between the OSFC and the opposite party by virtue of judgment dated 19.07.2013 of the learned District Judge, Cuttack in RFA No.34 of 2012, wherein it has categorically been stated that "the judgment and decree passed against the present appellant (IPICOL) is only set aside but will remain as such against the other defendants".
5.1. He submitted that since the judgment of the appellate Court was assailed before this Court in RSA No.373 of 2013 at the behest of decree-holder (present opposite party) as against the IPICOL, the said appeal got dismissed with reasons vide Judgment dated 08.09.2016. Since the first appeal was at the instance of the IPICOL, but not by the OSFC, the dismissal of second appeal arising out of judgment dated 19.07.2013 passed in RFA No.34 of 2012 by the learned District Judge, Cuttack can be said to have merged so far as it related to IPICOL. As the OSFC remained fence sitter, no relief before the executing Court can be claimed at this belated stage.
CRP No.30 of 2023 Page 21 of 885.2. It is also submitted by Sri Khetra Mohan Dhal, learned counsel for the opposite party that the OSFC was also arrayed as party in both the appeals.
Legal aspects as set forth by Courts:
6. Scope to challenge the decree before the Executing Court:
(i) Sobhabati Devi Vrs. Voona Bhimayya Subudhi, 1974 (1) CWR 72 [Orissa High Court]:
―9. *** It is fundamental that an executing Court cannot go behind the decree unless the decree is a nullity. A decree cannot be ignored merely because it is wrong or contrary to law. To render a decree a nullity, the Court which passed it must have lacked inherent jurisdiction to try the suit in which the decree was passed. So long as the Court had inherent jurisdiction to try the suit, a decree passed by it cannot be ignored merely on the ground that it is illegal and contrary to law.
10. Their Lordships of the Supreme Court examined the powers of the executing Court to challenge the effect of a decree in Hira Lal Patni Vrs. Shri Kali Nath, AIR 1962 SC 199.
The ground on which the validity of the decree was challenged is that the suit instituted on the original side of the Bombay High Court was wholly incompetent for want of territorial jurisdiction and therefore the award that followed on the reference between the parties CRP No.30 of 2023 Page 22 of 88 and the decree of the Court under execution were all null and void. After pointing out that the objection as to local jurisdiction of a Court does not stand on the same footing as an objection to the competence of a Court to try a case and that while competence of a Court to try a case goes to the very root of jurisdiction and where it is lacking it is a case of inherent lack of jurisdiction, that an objection to local jurisdiction of a Court can be waived, and this principle has been given a statutory recognition in Section 21 of the Code of Civil Procedure. His Lordship the Chief Justice speaking for the Court stated thus in paragraph 4:
‗The validity of a decree can be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seisin of the case because the subject matter was wholly foreign to the jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit or over the parties to it.' A similar matter came up for consideration before the Supreme Court in Ittyavira Mathai Vrs. Varkey Varkey, AIR 1964 SC 907. In that case, the validity of a decree was challenged on the ground that it is a nullity having been passed in a suit which was barred by time.CRP No.30 of 2023 Page 23 of 88
Rejecting the contention, their Lordships stated in para 8 thus:
‗Even assuming that the suit was barred by time, it is difficult to appreciate the contention of learned counsel that the decree can be treated as a nullity and ignored in subsequent litigation. If the suit was barred by time and yet, the court decreed it, the court would be committing an illegality and therefore the aggrieved party would be entitled to have the decree set aside by preferring an appeal against it. But it is well settled that a court having jurisdiction over the subject matter of the suit and over the parties thereto, though bound to decide right may decide wrong; and that even though it decided wrong it would not be doing something which it had no jurisdiction to do. It had the jurisdiction over the subject-matter and it had the jurisdiction over the party and, therefore, merely because it made an error in deciding a vital issue in the suit, it cannot be said that it has acted beyond its jurisdiction. As has often been said, courts have jurisdiction to decide right or to decide wrong and even though they decide wrong, the decrees rendered by them cannot be treated as nullities.'
11. In the present case, the trial Court which passed the impugned decree had the jurisdiction to try the suit. ***‖ CRP No.30 of 2023 Page 24 of 88
(ii) Haryana Vidyut Parsaran Nigam Limited Vrs.
Gulshan Lal, (2009) 8 SCR 937:
―16. The learned Judge in no uncertain terms held that no interest shall be payable thereupon. Denial of payment of interest, in our opinion, is significant and the same leads to the conclusion that the court was conscious of the fact that not only plaintiffs-respondents were entitled to a declaration but also to a mandatory injunction. But for the purpose of construction of a judgment, it must be read as a whole. The issues framed in that behalf assumes great significance. We have noticed, hereinbefore, that both the issues framed by the learned Trial Judge had correlation with the reliefs claimed for.
In U.P. State Road Transport Corporation Vrs. Assistant Commissioner of Police (Traffic), Delhi 2009 (2) SCALE 526, this Court held:
‗A decision is an authority, it is trite, for which it decides and not what can logically be deduced therefrom. This wholesome principle is equally applicable in the matter of c construction of a judgment. A judgment is not to be construed as a statute. It must be construed upon reading the same as a whole.
For the said purpose, the attending circumstances may also be taken into consideration.' *** CRP No.30 of 2023 Page 25 of 88
18. This court furthermore in State of MP Vrs.
Mangilal Sharma, (1998) 2 SCC 510 categorically held as under:
‗6. A declaratory decree merely declares the right of the decree holder vis-a-vis the judgment debtor and does not in terms direct the judgment-debtor to do or refrain from doing any particular act or thing. Since in the present case decree does not direct reinstatement or payment of arrears of salary the executing court could not issue any process for the purpose as that would be going outside or beyond the decree.
Respondent as a decree holder was free to seek his remedy for arrears of salary in the suit for declaration. The executing court has no jurisdiction to direct payment of salary or grant any other consequential relief which does not flow directly and necessarily from the declaratory decree. It is not that if in a suit for declaration where the plaintiff is able to seek further relief he must seek that relief though he may not be in need of that further relief. In the present suit the plaintiff while seeking relief of declaration would certainly have asked for other reliefs like the reinstatement, arrears of salary and consequential benefits. He was however, satisfied with a relief of declaration knowing that the Government would honour the decree and would reinstate him. We will therefore assume CRP No.30 of 2023 Page 26 of 88 that the suit for mere declaration filed by the respondent-plaintiff was maintainable, as the question of maintainability of the suit is not in issue before us.' However in that case as the decree for reinstatement and back wages had not been granted, the court opined that the Executing Court cannot grant a further relief. Herein, however, as noticed, the respondents not only had prayed for a declaratory decree but also decree for mandatory injunction.
19. *** in Bhawarlal Bhandari Vrs. Universal Heavy Mechanical Lifting Enterprises, (1999) 1 SCC 558. Therein the decree was passed by a court lacking inherent jurisdiction and in that situation this court considered as to whether a decree passed by a court wholly without jurisdiction would be a nullity to hold:
‗10. The aforesaid decision of this Court squarely applies to the facts of the present case. This is not a case in which the award decree on the face of it was shown to be without jurisdiction. Even if the decree was passed beyond the period of limitation, it would be an error of law or at the highest a wrong decision which can be corrected in appellate proceedings and not by the executing court which was bound by such decree. It is not the case of the respondent that the Court which passed the decree was lacking CRP No.30 of 2023 Page 27 of 88 inherent jurisdiction to pass such a decree. This becomes all the more so when the respondent did not think it fit to file objection against the award which was sought to be made rule of the court.' *** Whether by reason of the decree the respondents would be getting some amount by way of back wages for a period of more than three years would depend upon the facts of each case. It would also depend upon the date on which the cause of action of suit arose.
20. As indicated hereinbefore, for the purpose of allowing an objection filed on behalf of a judgment debtor under Section 47 of the Code of Civil Procedure, it was incumbent on him to show that the decree was ex facie nullity. For the said purpose, the court is precluded from making an in-depth scrutiny as regards the entitlement of the plaintiff with reference to not only his claim made in the plaint but also the defence set up by the judgment-debtor. As the judgment of the Trial Court could not have been reopened, the correctness thereof could not have been put to question. It is also well-known that an Executing Court cannot go behind the decree. If on a fair interpretation of the judgment, Order and decree passed by a court having appropriate jurisdiction in that behalf, the reliefs sought for by the plaintiff appear to have been granted, there is no reason as to why the Executing Court shall deprive him from obtaining the fruits of the decree. In Deepa Bhargava Vrs.CRP No.30 of 2023 Page 28 of 88
Mahesh Bhargava, 2008 (16) SCALE 305, this Court held as under:
‗11 *** An executing court, it is well known, cannot go behind the decree. It has no jurisdiction to modify a decree. It must execute the decree as it is. A default clause contained in a compromise decree even otherwise would not be considered to be penal in nature so as to attract the provisions of Section 74 of the Indian Contract Act.'
21. It is also not a case where this Court can exercise its jurisdiction under Article 142 of the Constitution of India to mould an order. The decree passed by the learned Trial Court has attained finality. Whether rightly or wrongly, the judgment ... of the learned Trial Judge has been affirmed by this Court. It is one thing to say that no right having crystalised in favour of a party to the lis, this Court can mould the relief appropriately, but it is another thing to say that despite the decree being found to be an executable one, this Court will refuse to direct execution thereof.
22. We are not oblivious of the fact that the respondents legally would not have been entitled to the reliefs prayed for by them.
However, as a decree has been passed, we do not intend to go behind the same. The Executing Court shall, it goes without saying, execute the decree strictly in terms thereof.‖ CRP No.30 of 2023 Page 29 of 88
7. Doctrine of merger:
(i) Chandi Prasad Vrs. Jagdish Prasad, (2004) 8 SCC 724:
―9. A decree is defined in Section 2(2) of the Code to mean the formal expression of an adjudication which, so far as regards the court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final. As against a judgment and decree unless otherwise restricted, a first appeal would be maintainable under Section 96 of the Code and a second appeal under Section 100 thereof. A decree within the meaning of Section 2(2) of the Code would be enforceable irrespective of the fact whether it is passed by the trial court, the first appellate court or the second appellate court.
23. The doctrine of merger is based on the principles of propriety in the hierarchy of the justice-delivery system. The doctrine of merger does not make a distinction between an order of reversal, modification or an order of confirmation passed by the appellate authority.
The said doctrine postulates that there cannot be more than one operative decree governing the same subject-matter at a given point of time.
24. It is trite that when an appellate court passes a decree, the decree of the trial court merges with the decree of the appellate court and even if CRP No.30 of 2023 Page 30 of 88 and subject to any modification that may be made in the appellate decree, the decree of the appellate court supersedes the decree of the trial court. In other words, merger of a decree takes place irrespective of the fact as to whether the appellate court affirms, modifies or reverses the decree passed by the trial court. When a special leave petition is dismissed summarily, doctrine of merger does not apply but when an appeal is dismissed, it does. [See V.M. Salgaocar and Bros. (P) Ltd. Vrs. CIT, (2000) 5 SCC 373 = AIR 2000 SC 1623].
25. The concept of doctrine of merger and the right of review came up for consideration recently before this Court in Kunhayammed Vrs. State of Kerala, (2000) 6 SCC 359 wherein this Court inter alia held that when a special leave petition is disposed of by a speaking order, the doctrine of merger shall apply stating: (SCC p. 383, paras 41-43) ‗41. Once a special leave petition has been granted, the doors for the exercise of appellate jurisdiction of this Court have been let open. The order impugned before the Supreme Court becomes an order appealed against. Any order passed thereafter would be an appellate order and would attract the applicability of doctrine of merger. It would not make a difference whether the order is one of reversal or of modification or of dismissal affirming the order appealed against. It would also not make any difference if the CRP No.30 of 2023 Page 31 of 88 order is a speaking or non-speaking one. Whenever this Court has felt inclined to apply its mind to the merits of the order put in issue before it though it may be inclined to affirm the same, it is customary with this Court to grant leave to appeal and thereafter dismiss the appeal itself (and not merely the petition for special leave) though at times the orders granting leave to appeal and dismissing the appeal are contained in the same order and at times the orders are quite brief. Nevertheless, the order shows the exercise of appellate jurisdiction and therein the merits of the order impugned having been subjected to judicial scrutiny of this Court.
42. ‗To merge' means to sink or disappear in something else; to become absorbed or extinguished; to be combined or be swallowed up. Merger in law is defined as the absorption of a thing of lesser importance by a greater, whereby the lesser ceases to exist, but the greater is not increased; an absorption or swallowing up so as to involve a loss of identity and individuality. (See Corpus Juris Secundum, Vol. LVII, pp. 1067-68.)
43. We may look at the issue from another angle. The Supreme Court cannot and does not reverse or modify the decree or order appealed against while deciding a petition for special leave to appeal. What CRP No.30 of 2023 Page 32 of 88 is impugned before the Supreme Court can be reversed or modified only after granting leave to appeal and then assuming appellate jurisdiction over it. If the order impugned before the Supreme Court cannot be reversed or modified at the SLP stage obviously that order cannot also be affirmed at the SLP stage.'
26. In Kunhayammed, (2000) 6 SCC 359 it was observed: (SCC p. 370, para 12) ‗12. *** Once the superior court has disposed of the lis before it either way -- whether the decree or order under appeal is set aside or modified or simply confirmed, it is the decree or order of the superior court, tribunal or authority which is the final, binding and operative decree or order wherein merges the decree or order passed by the court, tribunal or the authority below. However, the doctrine is not of universal or unlimited application. The nature of jurisdiction exercised by the superior forum and the content or subject-matter of challenge laid or which could have been laid shall have to be kept in view.'
27. The said decision has been followed by this Court in a large number of decisions including Union of India Vrs. West Coast Paper Mills Ltd., (2004) 2 SCC 747.
CRP No.30 of 2023 Page 33 of 8828. However, when an appeal is dismissed on the ground that delay in filing the same is not condoned, the doctrine of merger shall not apply. [See Raja Mechanical Co. (P) Ltd. Vrs. CCE, ILR (2002) 1 Del 33].‖
(ii) Amba Bai Vrs. Gopal, AIR 2001 SC 2003:
―11. If the judgment or order of an inferior court is subjected to an appeal or revision by the superior court and in such proceedings the order or judgment is passed by the superior court determining the rights of parties, it would supersede the order or judgment passed by the inferior court. The juristic justification for such doctrine of merger is based on the common law principle that there cannot be, at one and the same time, more than one operative order governing the subject- matter and the judgment of the inferior court is deemed to lose its identity and merges with the judgment of the superior court. In the course of time, this concept which was originally restricted to appellate decrees on the ground that an appeal is continuation of the suit, came to be gradually extended to other proceedings like revisions and even the proceedings before quasi-judicial and executive authorities.
12. This Court in State of Madras Vrs. Madurai Mills Co. Ltd., AIR 1967 SC 681 = (1967) 19 STC 144 observed as under: (AIR Headnote) CRP No.30 of 2023 Page 34 of 88 ‗The doctrine of merger is not a doctrine of rigid and universal application and it cannot be said that wherever there are two orders, one by the inferior authority and the other by a superior authority, passed in an appeal or revision, there is a fusion or merger of two orders irrespective of the subject-matter of the appellate or revisional order and the scope of the appeal or revision contemplated by the particular statute. The application of the doctrine depends on the nature of the appellate or revisional order in each case and the scope of the statutory provisions conferring the appellate or revisional jurisdiction.' ***‖
(iii) Hindustan Aluminium Corporation Limited Vrs.
Commissioner of Income Tax (Central), 1988 SCC OnLine Cal 357:
―10. In the case of Amritlal Bhogilal, (1958) 34 ITR 130, the Supreme Court dealt with a case where the Income-tax Officer had passed a composite order of assessment. One part of the order related to registration of the firm, which was the assessee in that case. The other part related to computation of the income of the firm. There was no appeal on the aspect of registration of the firm. In fact, that part of the order was not appealable at all. The Supreme Court held that in such a case, it could not be said that the entire order of the Income-tax Officer had merged in the CRP No.30 of 2023 Page 35 of 88 order of the Appellate Assistant Commissioner.
11. The question, however, is whether, in a case where the entire order is appealable but the grounds of appeal are confined to only some of the points involved in the order and the appellate order is also confined only to those aspects which have been taken in the grounds of appeal, it can be said that the issues that were neither raised in the grounds of appeal nor considered by the Appellate Assistant Commissioner had merged in the order of the Appellate Assistant Commissioner.
This question directly came up for consideration before the Supreme Court in the case of State of Madras Vrs. Madurai Mills Co.
Ltd., (1967) 19 STC 144. In this case, in the sales tax assessment for the year 1950-51, the Deputy Commercial Tax Officer, Madurai, determined the net turnover of the dealer at Rs. 15,44,09,109-3-11. In the appeal before the appellate authority, it was contended on behalf of the respondents that a sum of Rs. 1,44,294- 14-4 was wrongly included by the assessing authority in the purchase value of cotton as that amount only represented the commission paid by it to Comorin Investment Trading Company Limited. It was also contended that another sum of Rs.81,546-0-1, which represented sale proceeds realised by selling empty drums, was not a realisation in the course of its business. The appellate authority upheld the first contention in respect of the CRP No.30 of 2023 Page 36 of 88 payment of commission and rejected the second contention with regard to sale of empty drums.
12. A revision petition was thereafter presented before the Deputy Commissioner of Commercial Taxes by the dealer and the only objection raised was that it should not have assessed to tax on the amounts collected by it by way of tax amounting to Rs.6,57,971-4-9. By his order dated August 21, 1954, the Deputy Commissioner of Commercial Taxes dismissed the revision petition holding that the respondent was not entitled to raise the contention for the first time. It was further held that even otherwise, the statute permitted the inclusion of tax in the taxable turnover of the dealer.
13. Thereafter, on August 4, 1958, the Board of Revenue issued a notice to the dealer stating that it proposed to revise the assessment made by the Deputy Commercial Tax Officer, Madurai, by including in the net turnover a sum of Rs.7,74,62,706-1-6 as the amount had been wrongly excluded by the assessing authority. The dealer objected to the proposed revision on the ground that the proceeding was barred by limitation. Moreover, there was no wrong exclusion by the Deputy Commercial Tax Officer as alleged. The Board of Revenue, however, overruled both the objections and revised the taxable turnover by including the said amount of Rs.7,74,62,706-1-6.
CRP No.30 of 2023 Page 37 of 8814. Thereafter, the case went to the Madras High Court which held that the revision proceedings were barred by limitation. The State of Madras thereafter appealed to the Supreme Court. The question of law that fell for determination in that case was:
Whether the order of the Board of Revenue dated August 25, 1958, was illegal because there was a contravention of the rule of limitation laid down by section 12(3)(i) of the Madras General Sales Tax Act inasmuch as the order of the Board of Revenue was made after a period of 4 years from the date on which the order of the Deputy Commercial Tax Officer was communicated to the assessee.
15. On the basis of the principles laid down by the Supreme Court in the case of CIT Vrs. Amritlal Bhogilal and Co., (1958) 34 ITR 130, it was contended on behalf of the State of Madras that the order passed by the Deputy Commercial Tax Officer had merged in the appellate order of the Deputy Commissioner of Commercial Taxes passed on August 21, 1954, which was the operative order. The Board of Revenue was competent to revise that order within the period of four years of passing of that order. The Supreme Court rejected this contention in the following words (at p. 149 of 19 STC):
‗But the doctrine of merger is not a doctrine of rigid and universal application and it cannot be said that wherever there are two orders, one by the inferior tribunal and the other by a CRP No.30 of 2023 Page 38 of 88 superior tribunal, passed in an appeal or revision, there is a fusion or merger of the two orders irrespective of the subject-matter of the appellate or revisional order and the scope of the appeal or revision contemplated by the particular statute. In our opinion, the application of the doctrine depends on the nature of the appellate or revisional order in each case and the scope of the statutory provisions conferring the appellate or revisional jurisdiction. For example, in Amritlal Bhogilal and Co.'s case, (1958) 34 ITR 130 (SC), it was observed by this court that the order of registration made by the Income-tax Officer did not merge in the appellate order of the Appellate Commissioner, because the order of registration was not the subject-matter of appeal before the appellate authority. It should be noticed that the order of assessment made by the Income-tax Officer in that case was a composite order, viz., an order granting registration of the firm and making an assessment on the basis of the registration. The appeal was taken by the assessee to the Appellate Commissioner against the composite order of the Income Tax Officer. It was held by the High Court that the order of the Income-tax Officer granting registration to the respondent must be deemed to be merged in the appellate order and that the revisional power of the Commissioner of Income-tax cannot, therefore, be exercised in respect of it. The view taken by the High Court was overruled by this court for the reason that the order of the Income-tax Officer granting registration cannot be deemed CRP No.30 of 2023 Page 39 of 88 to have merged in the order of the Appellate Commissioner in an appeal taken against the composite order of assessment... In the circumstances of the present case, it cannot be said that there was a merger of the order of assessment made by the Deputy Commercial Tax Officer dated November 28, 1952, with the order of the Deputy Commissioner of Commercial Taxes dated the 24th August, 1954, because the question of exemption of the value of yarn purchased from outside the State of Madras was not the subject-matter of revision before the Deputy Commissioner of Commercial Taxes. The only point that was urged before the Deputy Commissioner was that the sum of Rs.6,57,971-4-9 collected by the respondent by was of tax should not be included in the taxable turnover. This was the only point raised before the Deputy Commissioner and was rejected by him in the revision proceedings. On the contrary, the question before the Board of Revenue was whether the Deputy Commercial Tax Officer, Madurai, was right in excluding from the net taxable turnover of the respondent the sum of Rs. 7,74,62,706-1-0 which was the value of cotton purchased by the respondent from outside the State of Madras. We are, therefore, of opinion that the doctrine of merger cannot be invoked in the circumstances of the present case.'
16. If this principle is applied to the instant case, it will be seen that the subject-matter of appeal before the Appellate Assistant Commissioner or CRP No.30 of 2023 Page 40 of 88 the Tribunal was not concerned in any way with the question of exchange fluctuation.
Whether the loss occasioned by exchange fluctuation was a capital loss or revenue loss was a question that was not raised, gone into or decided by the Appellate Assistant Commissioner or the Tribunal.
17. Therefore, if the principle laid down by the Supreme Court in the case of State of Madras Vrs. Madurai Mills Co. Ltd., (1967) 19 STC 144 is applied, it will clearly appear that the entire order of the Income-tax Officer had not merged with the appellate order.
***
29. The principles enunciated by the Supreme Court in the case of State of Madras Vrs. Madurai Mills Co. Ltd., (1967) 19 STC 144 leave no room for doubt that what merges in the order of the appellate or revisional authority is not the entire appealable order of the lower authority but only that part of the order of the lower authority which was under
consideration of the higher authority in revision or in appeal. It is also to be noted from the judgment of the Supreme Court that for the purpose of application of the doctrine, of merger, no distinction can be made between an order passed in revision and an order passed in appeal.
*** CRP No.30 of 2023 Page 41 of 88
35. The question of merger was examined in extenso by the Supreme Court in the case of Gojer Bros. (P.) Ltd. Vrs. Shri Ratan Lal Singh, (1974) 2 SCC 453 = AIR 1974 SC 1380. In that case, the Supreme Court, after referring to its earlier decision in the case of State of Madras Vrs. Madurai Mills Co. Ltd., (1967) 19 STC 144, observed (at pp.1388, 1389):
‗These observations cannot justify the view that in the instant case there can be no merger of the decree passed by the trial court in the decree of the High Court. The court, in fact, relied on Amritlal Bhogilal's case, (1958) 34 ITR 130 = (1959) SCR 713 = AIR 1958 SC 868, while pointing out that if the subject-matter of the two proceedings is not identical, there can be no merger. Just as in Amritlal Bhogilal's case, (1958) 34 ITR 130 (SC), the question of registration of the assessee-firm was not before the appellate authority and, therefore, there could be no merger of the order of the Income-
tax Officer in the appellate order, so in the case of Madurai Mills, (1967) 19 STC 144 = (1967) 1 SCR 732 = AIR 1967 SC 681, there could be no merger of the assessment order in the revisional order as the question regarding exclusion of the value of yarn purchased from outside the State was not the subject-matter of revision before the Deputy Commissioner of Commercial Taxes.
In the instant case, the subject-matter of the suit and the subject-matter of the appeal were identical. The entire decree of CRP No.30 of 2023 Page 42 of 88 the trial court was taken in appeal to the first appellate court and then to the High Court... We are, accordingly, of the opinion that the decree of the trial court dated November 24, 1958, merged in the decree of the High Court dated January 8, 1969.
36. The aforesaid observation makes it clear that unless the subject-matter of the suit and the subject-matter of the appeal were identical, there could not be any merger of the decree of the trial court in the decree of the appeal court entirely.‖
(iv) Utkal Galvanisers Pvt. Ltd. Vrs. Assistant Commissioner of Income Tax, 105 (2008) CLT 533 (Ori):
―In the case of India Tin Industries P. Ltd. (1987) 166 ITR 454 their Lordships of the Karnataka High Court came to hold that sub-section (1A) of section 154 specifically provides that any matter which has not been considered and decided in any proceeding by way of appeal or revision, may be amended by the authority passing such an order in exercise of its power under section 154(1). Their Lordships further came to hold that the doctrine of merger is not a doctrine of rigid and universal application and it cannot be said that wherever there are two orders, one by an inferior Tribunal and the other by a superior Tribunal passed in an appeal or revision, there is a fusion or merger of the two orders irrespective of the subject-
matter of the appeal. The order of assessment CRP No.30 of 2023 Page 43 of 88 made by the Income-tax Officer merges in the order of the Commissioner in so far as it relates to items considered and decided by the Commissioner. That part of the order of assessment, which relates to items not forming the subject-matter of the appellate order and left untouched does not merge in the order of the Commissioner. Even after an appeal from an order of assessment is decided by the Commissioner, a mistake in that part of the order of assessment which was not the subject-matter of the appeal and was thereafter left untouched by the Commissioner, can be rectified by the Income-tax Officer.‖
8. Estoppel and waiver:
(i) Hope Plantations Ltd. Vrs. Taluk Land Board, (1999) 5 SCC 590:
―26. It is settled law that the principles of estoppel and res judicata are based on public policy and justice. Doctrine of res judicata is often treated as a branch of the law of estoppel though these two doctrines differ in some essential particulars. Rule of res judicata prevents the parties to a judicial determination from litigating the same question over again even though the determination may even be demonstratedly wrong. When the proceedings have attained finality, parties are bound by the judgment and are estopped from questioning it. They cannot litigate again on the same cause of action nor can they litigate any issue which was necessary for decision in the earlier litigation. These two CRP No.30 of 2023 Page 44 of 88 aspects are ―cause of action estoppel‖ and ―issue estoppel‖. These two terms are of common law origin. Again, once an issue has been finally determined, parties cannot subsequently in the same suit advance arguments or adduce further evidence directed to showing that the issue was wrongly determined. Their only remedy is to approach the higher forum if available. The determination of the issue between the parties gives rise to, as noted above, an issue estoppel. It operates in any subsequent proceedings in the same suit in which the issue had been determined. It also operates in subsequent suits between the same parties in which the same issue arises. Section 11 of the Code of Civil Procedure contains provisions of res judicata but these are not exhaustive of the general doctrine of res judicata. Legal principles of estoppel and res judicata are equally applicable in proceedings before administrative authorities as they are based on public policy and justice.‖
(ii) Municipal Corporation of Greater Bombay Vrs.
Hakimwadi Tenants' Association, AIR 1988 SC 233:
―In order to constitute waiver, there must be voluntary and intentional relinquishment of a right. The essence of a waiver is an estoppel and where there is no estoppel, there is no waiver. Estoppel and waiver are questions of conduct and must necessarily be determined on the facts of each case. ***‖ CRP No.30 of 2023 Page 45 of 88
(iii) Bashehar Nath Vrs. Commissioner of Income Tax, AIR 1978 SC 1351:
―*** I may refer in this connection to the provisions in Part XIII1 which relate to trade, commerce and intercourse within the territory of India. These provision also impose certain restrictions on the legislative powers on the Union and of the States with regard to trade and commerce. As these provisions are for the benefit of the general public and not for any particular individual, they cannot be waived, even though they do not find place in Part III of the Constitution. Therefore, the crucial question is not whether the rights or restrictions occur in one part or other of the Constitution. The crucial question is the nature of the rights given: is it for the benefits of individuals or is it for the general public?‖ The issue:
9. With the aforesaid perspective of law as set forth by the Courts, on the facts and in the circumstances, the issue involved in this matter revolves around narrow compass, viz., WHETHER, on dismissal of second appeal filed by the decree-holder (opposite party herein) against the one of the defendants before the trial Court in the suit (IPICOL), and the judgment of the appellate Court holding that the financier-IPICOL is not liable to discharge the decree 1 Constitution of India.
CRP No.30 of 2023 Page 46 of 88inasmuch as the finding that there is no privity of contract between the financier (judgment debtor) and the opposite party (decree holder) attained finality, the decree is enforceable as against other defendants namely the OSFC, which chose not to prefer appeal questioning the decree?
Analysis and discussion:
10. With the factual matrix being not disputed, this Court now proceeds to examine the effect of decree and appellate order(s) qua the opposite party-Jyoti Prakash Das and the petitioner-OSFC.
10.1. In the suit, TMS No.747 of 1989, while the petitioner herein was arrayed as defendant No.5, the IPICOL was defendant No.6 and the opposite party herein was plaintiff. By the judgment dated 24.12.2011 passed in the said suit it was held that the defendant Nos.5 and 6 are jointly and severally liable to pay to the plaintiff.
10.2. It is admitted position that the petitioner has not preferred any appeal. However, the defendant No.6 preferred appeal, bearing RFA No.34 of 2012, before the learned District Judge, Cuttack. The judgment dated 19.07.2013, disposing of said RFA reflects as follows:
―The judgment and decree passed against the present appellant (the Industrial Promotion and Investment CRP No.30 of 2023 Page 47 of 88 Corporation of Orissa Limited) is only set aside, but will remain as such against the other defendants.‖ 10.3. The present opposite party, being dissatisfied with the judgment dated 19.07.2013, so far as the order contained qua the defendant No.6 is concerned, preferred second appeal, being RSA No.373 of 2013, which was dismissed vide Judgment dated 08.09.2016 with the specific observation that, ―There was no contract between the plaintiff (Jyoti Prakash Das) and this defendant No.6 (the Industrial Promotion and Investment Corporation of Orissa Limited) for supply of electrical goods and for entrustment of the work of electrical installation in the hotel. ... Thus, I find that the lower appellate Court has addressed the questions raised insofar as the liability of the defendant No.6 is concerned in accordance with law in rightly holding that the defendant No.6 has no liability in the matter of payment of money to the plaintiff.‖ 10.4. Said judgment dated 08.09.2016 passed in RSA No.373 of 2013 has been further clarified in Order dated 15.11.2017 passed in Misc. Case No.950 of 2016 filed by Jyoti Prakash Das (plaintiff). It has been clarified thus:
―It is needless to say that the second appeal since has been dismissed without admission, the judgment and decree as passed by the first appellate Court which has marched over the judgment and decree passed by the trial Court to the extent as found therein, holds the field.‖ CRP No.30 of 2023 Page 48 of 88 10.5. With the conspectus of judicial pronouncements it can be culled out that a decree against a party becomes final, if not appealed against, and the benefit of an appeal by another party cannot be extended to the party who has chosen not to appeal, unless the circumstances of the case make it inevitable to do so.
10.6. Thus, the above judgments/orders would make it clear that the petitioner having not questioned the propriety of judgment and decree of the learned trial Court before the higher Court(s), as is unequivocally stated by the learned District Judge that the judgment and decree is set aside qua the defendant No.6 (IPICOL) only. Therefore, the entire judgment and decree of the learned 2nd Additional Senior Civil Judge, Cuttack cannot be construed to have been merged with the judgment of the appellate Court(s).
11. Pleadings and particulars are required to enable the Court to decide the rights of the parties in the trial.
Thus, the pleadings are more to help the Court in narrowing the controversy involved and to inform the parties concerned to the question in issue, so that the parties may adduce appropriate evidence on the said issue. It is a settled legal proposition that "as a rule relief not founded on the pleadings should not be granted." Therefore, a decision of a case cannot be based on grounds outside the pleadings of the parties. The pleadings and issues are to ascertain the real dispute CRP No.30 of 2023 Page 49 of 88 between the parties to narrow the area of conflict and to see just where the two sides differ. (Vide: State of Odisha Vrs. Mamata Mohanty, (2011) 2 SCR 704).
11.1. It is urged by the learned counsel for the petitioner that in view of challenge against the judgment dated 19.07.2013 of the learned District Judge, Cuttack in RFA No.34 of 2012 by the opposite party being not admitted by this Court in the second appeal, the appellate order, by virtue of which the judgment and decree passed by the 2nd Additional Senior Civil Judge, Cuttack has been set aside, being operative, the relief should have been granted to the petitioner (OSFC) as it is identically positioned. A non est judgment and decree cannot be executed as it is void.
11.2. In Ashok Malhotra Vrs. Union of India, 2005 SCC OnLine Del 1216 position with respect to void order or invalid order and its enforceability has been discussed in the following manner:
―17. Dealing with the question of invalidation of an order, H.W.R. Wade and C.F. Forsyth have in their treatise Administrative Law--Eighth Edition observed:
‗The truth is that the court will invalidate an order only if the right remedy is sought by the right person in the right proceedings and circumstances. The order may be ‗a nullity' and ‗void' but these terms have no absolute sense: their meaning is relative, depending upon the court's willingness to grant relief CRP No.30 of 2023 Page 50 of 88 in any particular situation. If this principle of legal relativity is borne in mind, the law can be made to operate justly and reasonably in cases where the doctrine of ultra vires, rigidly applied, would produce unacceptable results.'
18. We may also at this stage refer to the following passage from the decision in Smith Vrs. East Elloe Rural District Council, (1956) AC 736, where Lord Radcliffe has emphasised the need for resorting to legal proceedings to establish the cause of invalidity of an order and to have it quashed for otherwise the order remains valid:
‗An order, even if not made in good faith, is still an act capable of legal consequences. It bears no brand of invalidity upon its forehead. Unless the necessary proceedings are taken at law to establish the cause of invalidity and to get it quashed or otherwise upset, it will remain as effective for its ostensible purpose as the most impeccable of orders.'
19. As to what is void and what is voidable, has been the subject matter of numerous judicial pronouncements but before we refer to some of those decisions, we may usefully extract the following passage from De Smith, Woolf and Jowell in their treatise Judicial Review of Administrative Action, Fifth Edition, para 5-044, where the concept of void and voidable has been summarised as follows:
‗Behind the simple dichotomy of void and voidable acts (invalid and valid until declared to be invalid) lurk terminological and conceptual problems of excruciating complexity. The problems arose from the CRP No.30 of 2023 Page 51 of 88 premise that if an act, order or decision is ultra vires in the sense of outside jurisdiction, it was said to be invalid, or null and void. If it is intra vires it was, of course, valid. If it is flawed by an error perpetrated within the area of authority or jurisdiction, it was usually said to be voidable; that is, valid till set aside on appeal or in the past quashed by certiorari for error of law on the face of the record.'
20. A careful reading of the above would show that what distinguishes an order that is void from another that is voidable essentially lies in whether the order in question is outside the jurisdiction of the authority making the same. On the other hand, if it is an order that is within the jurisdiction of the authority making the same but the order suffers from an error or irregularity that falls within the jurisdictional sphere of the authority making the order, it is voidable.
21. In Winona Oil Co. Vrs. Barnes, 200 P.981, 985, 83 Okl. 248, the Court held that a judgment is void if it falls short of jurisdictional elements on three counts, which were summed up as under:
‗A judgment is ―void‖ when it affirmatively appears from the inspection of the judgment roll that any one of three following jurisdictional elements are absent:
First, jurisdiction over the person;
Second, jurisdiction of the subject-matter; and, Third, judicial power to render the particular judgment.' CRP No.30 of 2023 Page 52 of 88
22. To the same effect is the decision in New York Casualty Co. Vrs. Lawson, 24 S.W. (2d) 881, 883, 160 Tenn. 329, where the Court observed:
‗A ―void judgment‖ is one which shows on the face of record a want of jurisdiction in court assuming to render judgment, which want of jurisdiction may be either of the person or of the subject-matter generally, or of particular question attempted to be decided or relief assumed to be given.'
23. In Ittyavira Mathai Vrs. Varkey Varkey, AIR 1964 SC 907, the court was dealing with the question whether a decree in a suit which was barred by time would fall within the realm of nullity. Answering the question in the negative, the Court observed that while passing a decree in a suit that is time barred, the Court may be committing an illegality, but since the Court has the jurisdiction to decide right or to decide wrong, the decree would not be a nullity even if the decision was wrong. The following passage is, in this connection, relevant:
‗If the suit was barred by time and yet the court decreed it, the court would be committing an illegality and therefore the aggrieved party would be entitled to have the decree set aside by preferring an appeal against it. But it is well settled that a court having jurisdiction over the subject- matter of the suit and over the parties thereto, though bound to decide right may decide wrong; and that even though it decided wrong it would not be doing something which it had no jurisdiction to do. It had the jurisdiction over the subject matter and it had the CRP No.30 of 2023 Page 53 of 88 jurisdiction over the party and, therefore, merely because it made an error in deciding a vital issue in the suit, it cannot be said that it has acted beyond its jurisdiction. As has often been said, courts have jurisdiction to decide right or to decide wrong and even though they decide wrong, the decrees rendered by them cannot be treated as nullities.'
24. It is, therefore, evident that expressions ―void‖ and ―voidable‖ have more than one facet. Transactions and decrees which are wholly without jurisdiction are void ab initio and no declaration may be necessary for avoiding the same. Law does not take any notice of such acts, transactions or decrees which can be disregarded in collateral proceedings or otherwise. There are, however, transactions, which will remain good unless declared to be otherwise. For instance, transactions against a minor without being represented by a next friend may be voidable at the instance of the minor in appropriate proceedings in which case it becomes void from the beginning. The third category may be the cases where an act or transaction is good unless declared to be void. Such a transaction is voidable because the apparent state of affairs is the real state of affairs and a party who alleges otherwise, shall have to prove it. For instance, if the document is forged and fabricated, a declaration to that effect is necessary for otherwise the document is legally effective.‖ 11.3. This Court in Buli Jena Vrs. Bishnu Charan Sutar, 2017 (II) ILR-CUT 1125 held that, CRP No.30 of 2023 Page 54 of 88 ―In State of Kerala Vrs. M.K. Kunhikannan Nambiar, AIR 1996 SC 906, the apex Court held that even a void order or decision rendered between parties cannot be said to be non-existent in all cases and in all situations. Ordinarily, such an order will, in fact be effective inter parties until it is successfully avoided or challenged in higher forum. Mere use of the word „void‟ is not determinative of its legal impact. The word ‗void' has a relative rather than an absolute meaning. It only conveys the idea that the order is invalid or illegal. It can be avoided. There are degrees of invalidity, depending upon the gravity of the infirmity, as to whether it is, fundamental or otherwise.‖ 11.4. In Krishnadevi Malchand Kamathia Vrs. Bombay Environmental Action Group, (2011) 3 SCC 363 it has been laid down as follows:
―16. It is a settled legal proposition that even if an order is void, it requires to be so declared by a competent forum and it is not permissible for any person to ignore the same merely because in his opinion the order is void. In State of Kerala Vrs. M.K. Kunhikannan Nambiar Manjeri Manikoth Naduvil, (1996) 1 SCC 435 = AIR 1996 SC 906, Tayabbhai M. Bagasarwalla Vrs. Hind Rubber Industries (P) Ltd., (1997) 3 SCC 443 = AIR 1997 SC 1240, M. Meenakshi Vrs. Metadin Agarwal, (2006) 7 SCC 470 and Sneh Gupta Vrs. Devi Sarup, (2009) 6 SCC 194, this Court held that whether an order is valid or void, cannot be determined by the parties. For setting aside such an order, even if void, the party has to approach the appropriate forum.CRP No.30 of 2023 Page 55 of 88
17. In State of Punjab Vrs. Gurdev Singh, (1991) 4 SCC 1 = AIR 1991 SC 2219 this Court held that a party aggrieved by the invalidity of an order has to approach the court for relief of declaration that the order against him is inoperative and therefore, not binding upon him. ***
18. In Sultan Sadik Vrs. Sanjay Raj Subba, (2004) 2 SCC 377 = AIR 2004 SC 1377, this Court took a similar view observing that once an order is declared non est by the court only then the judgment of nullity would operate erga omnes i.e. for and against everyone concerned. Such a declaration is permissible if the court comes to the conclusion that the author of the order lacks inherent jurisdiction/ competence and therefore, it comes to the conclusion that the order suffers from patent and latent invalidity.‖ 11.5. It is not the case of the petitioner that the learned 2nd Additional Senior Civil Judge, Cuttack had no jurisdiction over the subject-matter or the parties concerned. The decree, though alleged to be erroneous one in terms of judgment dated 08.09.2016 passed in second appeal of the opposite party, cannot be said to be void one and inexecutable inasmuch as the same has been clarified to remain intact as against all defendants excluding the defendant No.6 (IPICOL) vide the Order dated 15.11.2017 passed in Misc. Case No.950 of 2016 (arising out of RSA No.373 of 2013).CRP No.30 of 2023 Page 56 of 88
11.6. As is manifest from the aforesaid factual position, it is clear as broad day light that the second appeal at the behest of Jyoti Prakash Das before this Court got dismissed as against the defendant No.6, i.e., Industrial Promotion and Investment Corporation of Orissa Limited. Therefore, the Order dated 15.11.2017 of this Court clarifying the judgment dated 08.09.2016 affirming the judgment/order dated 19.07.2013 of the learned District Judge, Cuttack so far as the subject-
matter related to IPICOL attained finality. Since the said judgment cannot be construed to be a judgment in rem, and the OSFC, defendant No.5, did not choose to assail the judgment and decree passed by the 2nd Additional Senior Civil Judge, Cuttack, even if it is alleged to be wrong or invalid, unless the same is set aside/quashed by competent Court in a properly constituted lis instituted by OSFC, the same continues to have binding force qua the petitioner and the opposite party. Thus, the contention of the petitioner that the decree is not executable under Section 47 is misnomer and misconceived.
11.7. A reference to following observation made in Banarsi Vrs.
Ram Phal, (2003) 9 SCC 606 throws light on the legal position as to who is required to file appeal and cross- objection being aggrieved by decree:
CRP No.30 of 2023 Page 57 of 88―6. The appeals raise a short but interesting question of frequent recurrence as to the power of the appellate court to interfere with and reverse or modify the decree appealed against by the appellants in the absence of any cross-appeal or cross-objection by the respondent under Order 41 Rule 22 CPC and the scope of power conferred on the appellate court under Rule 33 of Order 41 CPC.
8. Sections 96 and 100 CPC make provision for an appeal being preferred from every original decree or from every decree passed in appeal respectively;
none of the provisions enumerates the person who can file an appeal. However, it is settled by a long catena of decisions that to be entitled to file an appeal the person must be one aggrieved by the decree. Unless a person is prejudicially or adversely affected by the decree he is not entitled to file an appeal. (See Phoolchand Vrs. Gopal Lal, AIR 1967 SC 1470 = (1967) 3 SCR 153, Jatan Kumar Golcha Vrs. Golcha Properties (P) Ltd., (1970) 3 SCC 573 and Ganga Bai Vrs. Vijay Kumar, (1974) 2 SCC
393.) No appeal lies against a mere finding. It is significant to note that both Sections 96 and 100 CPC provide for an appeal against decree and not against judgment.
9. Any respondent though he may not have filed an appeal from any part of the decree may still support the decree to the extent to which it is already in his favour by laying challenge to a finding recorded in the impugned judgment against him. Where a plaintiff seeks a decree against the defendant on grounds (A) and (B), any one of the two grounds being enough to entitle the CRP No.30 of 2023 Page 58 of 88 plaintiff to a decree and the court has passed a decree on ground (A) deciding it for the plaintiff while ground (B) has been decided against the plaintiff, in an appeal preferred by the defendant, in spite of the finding on ground (A) being reversed the plaintiff as a respondent can still seek to support the decree by challenging the finding on ground (B) and persuade the appellate court to form an opinion that in spite of the finding on ground (A) being reversed to the benefit of the defendant-appellant the decree could still be sustained by reversing the finding on ground (B) though the plaintiff-respondent has neither preferred an appeal of his own nor taken any cross- objection. A right to file cross-objection is the exercise of right to appeal though in a different form. It was observed in Sahadu Gangaram Bhagade Vrs. Special Dy. Collector, Ahmednagar, (1970) 1 SCC 685 = (1971) 1 SCR 146 that the right given to a respondent in an appeal to file cross-objection is a right given to the same extent as is a right of appeal to lay challenge to the impugned decree if he can be said to be aggrieved thereby. Taking any cross-objection is the exercise of right of appeal and takes the place of cross-appeal though the form differs. Thus it is clear that just as an appeal is preferred by a person aggrieved by the decree so also a cross- objection is preferred by one who can be said to be aggrieved by the decree. A party who has fully succeeded in the suit can and needs to neither prefer an appeal nor take any cross-objection though certain finding may be against him. Appeal and cross-objection-- both are filed against decree and not against judgment and certainly not against any finding recorded in a judgment.
CRP No.30 of 2023 Page 59 of 88This was the well-settled position of law under the unamended CPC.
10. The CPC amendment of 1976 has not materially or substantially altered the law except for a marginal difference. Even under the amended Order 41 Rule 22 sub-rule (1) a party in whose favour the decree stands in its entirety is neither entitled nor obliged to prefer any cross-objection. However, the insertion made in the text of sub-rule (1) makes it permissible to file a cross-objection against a finding. The difference which has resulted we will shortly state. A respondent may defend himself without filing any cross-objection to the extent to which decree is in his favour; however, if he proposes to attack any part of the decree he must take cross-objection. The amendment inserted by the 1976 amendment is clarificatory and also enabling and this may be made precise by analysing the provision. There may be three situations:
(i) The impugned decree is partly in favour of the appellant and partly in favour of the respondent.
(ii) The decree is entirely in favour of the respondent though an issue has been decided against the respondent.
(iii) The decree is entirely in favour of the respondent and all the issues have also been answered in favour of the respondent but there is a finding in the judgment which goes against the respondent.CRP No.30 of 2023 Page 60 of 88
11. In the type of case (i) it was necessary for the respondent to file an appeal or take cross-objection against that part of the decree which is against him if he seeks to get rid of the same though that part of the decree which is in his favour he is entitled to support without taking any cross-objection. The law remains so post-amendment too. In the type of cases
(ii) and (iii) pre-amendment CPC did not entitle nor permit the respondent to take any cross-objection as he was not the person aggrieved by the decree. Under the amended CPC, read in the light of the explanation, though it is still not necessary for the respondent to take any cross-objection laying challenge to any finding adverse to him as the decree is entirely in his favour and he may support the decree without cross-objection; the amendment made in the text of sub-rule (1), read with the explanation newly inserted, gives him a right to take cross-objection to a finding recorded against him either while answering an issue or while dealing with an issue. The advantage of preferring such cross-objection is spelled out by sub-rule (4). In spite of the original appeal having been withdrawn or dismissed for default the cross- objection taken to any finding by the respondent shall still be available to be adjudicated upon on merits which remedy was not available to the respondent under the unamended CPC. In the pre-amendment era, the withdrawal or dismissal for default of the original appeal disabled the respondent to question the correctness or otherwise of any finding recorded against the respondent.
*** CRP No.30 of 2023 Page 61 of 88
215. Rule 4 seeks to achieve one of the several objects sought to be achieved by Rule 33, that is, avoiding a situation of conflicting decrees coming into existence in the same suit. The abovesaid provisions confer power of the widest amplitude on the appellate court so as to do complete justice between the parties and such power is unfettered by consideration of facts like what is the subject-matter of the appeal, who has filed the appeal and whether the appeal is being dismissed, allowed or disposed of by modifying the judgment appealed against. While dismissing an appeal and though confirming the impugned decree, the appellate court may still direct passing of such decree or making of such order which ought to have been passed or made by the court below in accordance with the findings of fact and law arrived at by the court below and which it would have done had it been conscious of the error committed by it and noticed by the appellate court. While allowing the appeal or otherwise interfering with the decree or order appealed against, the appellate court may pass or make such further or other, decree or order, as the case would require being done, consistently with the findings arrived at by the appellate court. The object sought to be achieved by conferment of such power on the appellate court is to avoid inconsistency, inequity, inequality in reliefs granted to similarly placed parties and unworkable decree or order coming into existence. The overriding consideration is achieving the ends of justice. Wider the power, higher the need for caution and care while exercising the power. Usually the power under Rule 33 is 2 [Ed.: Para 15 corrected as per Official Corrigendum No. F.3/Ed.B.J./65/2003] CRP No.30 of 2023 Page 62 of 88 exercised when the portion of the decree appealed against or the portion of the decree held liable to be set aside or interfered by the appellate court is so inseparably connected with the portion not appealed against or left untouched that for the reason of the latter portion being left untouched either injustice would result or inconsistent decrees would follow. The power is subject to at least three limitations:
firstly, the power cannot be exercised to the prejudice or disadvantage of a person not a party before the court; secondly, a claim given up or lost cannot be revived; and thirdly, such part of the decree which essentially ought to have been appealed against or objected to by a party and which that party has permitted to achieve a finality cannot be reversed to the advantage of such party. A case where there are two reliefs prayed for and one is refused while the other one is granted and the former is not inseparably connected with or necessarily depending on the other, in an appeal against the latter, the former relief cannot be granted in favour of the respondent by the appellate court exercising power under Rule 33 of Order 41.
16. Panna Lal Vrs. State of Bombay, AIR 1963 SC 1516 = (1964) 1 SCR 980 so sets out the scope of Order 41 Rule 33 in the widest terms:
‗The wide wording of Order 41 Rule 33 was intended to empower the appellate court to make whatever order it thinks fit, not only as between the appellant and the respondent but also as between a respondent and a respondent. It empowers the appellate court not only to give or refuse relief to the appellant by allowing or dismissing the CRP No.30 of 2023 Page 63 of 88 appeal but also to give such other relief to any of the respondents as „the case may require‟. If there was no impediment in law the High Court in appeal could, therefore, though allowing the appeal of the defendant-appellant by dismissing the plaintiff‟s suits against it, give the plaintiff-respondent a decree against any or all the other defendants who were parties to the appeal as respondents. While the very words of the rule make this position abundantly clear the Illustration puts the position beyond argument.' The suit was filed by the plaintiff impleading the State Government and the Deputy Commissioner seeking recovery of compensation for the work done under a contract and the price of the goods supplied. The trial court held that the State was liable as it had beyond doubt benefited by the performance of the plaintiff. The suit was decreed against the State. The State preferred an appeal in the High Court. The plaintiff and other defendants including the Deputy Commissioner were impleaded as respondents. Disagreeing with the trial court, the High Court held that the contract entered into by the Deputy Commissioner was not binding on the State Government; that the Deputy Commissioner signed the contract at his own discretion; and further, that the contract not having been entered into in the form as required under Section 175(3) of the Government of India Act, 1935, was not enforceable against the State Government. The High Court also held that the Government could not be held to have ratified the action of the contract entered into by the Deputy Commissioner. The State was held also not to have benefited by the CRP No.30 of 2023 Page 64 of 88 performance of the plaintiff. On this finding, the High Court set aside the trial court's decree passed against the State Government. In an appeal to this Court, the Constitution Bench held that it was a fit case for the exercise of jurisdiction under Order 41 Rule 33 CPC. On the findings arrived at by the High Court, while setting aside the decree against the State, the High Court should have passed a decree against the Deputy Commissioner. It was not necessary for the plaintiff to have filed any cross-objection and the Illustration appended to Order 41 Rule 33 was enough to find solution.
17. In Rameshwar Prasad Vrs. Shambehari Lal Jagannath, AIR 1963 SC 1901 = (1964) 3 SCR 549 the three-Judge Bench speaking through Raghubar Dayal, J. observed that:
‗Rule 33 really provides as to what the appellate court can find the appellant entitled to. It empowers the appellate court to pass any decree and make any order which ought to have been passed or made in the proceedings before it and thus could have reference only to the nature of the decree or order insofar as it affects the rights of the appellant. It further empowers the appellate court to pass or make such further or other decree or order as the case may require. The court is thus given a wide discretion to pass such decrees and orders as the interests of justice demand. Such a power is to be exercised in exceptional cases when its non-exercise will lead to difficulties in the adjustment of rights of the various parties.' (vide AIR p. 1905, para 17) CRP No.30 of 2023 Page 65 of 88
18. In Harihar Prasad Singh Vrs. Balmiki Prasad Singh, (1975) 1 SCC 212 the following statement of law made by Venkatarama Aiyar, J. (as His Lordship then was) in the Division Bench decision in Venukuri Krishna Reddi Vrs. Kota Ramireddi, AIR 1954 Mad 848 was cited with approval which clearly brings out the wide scope of power contained in Rule 33 and the Illustration appended thereto, as also the limitations on such power: (SCC p. 236, para 36) ‗Though Order 41 Rule 33 confers wide and unlimited jurisdiction on courts to pass a decree in favour of a party who has not preferred any appeal, there are, however, certain well-defined principles in accordance with which that jurisdiction should be exercised. Normally, a party who is aggrieved by a decree should, if he seeks to escape from its operation, appeal against it within the time allowed after complying with the requirements of law. Where he fails to do so, no relief should ordinarily be given to him under Order 41 Rule
33.
But there are well-recognised exceptions to this rule. One is where as a result of interference in favour of the appellant it becomes necessary to readjust the rights of other parties. A second class of cases based on the same principle is where the question is one of settling mutual rights and obligations between the same parties. A third class of cases is when the relief prayed for is single and indivisible but is claimed against a number of defendants. In such cases, if the suit is decreed and there is an appeal only by some of the defendants and if the relief is granted only to the appellants there is the CRP No.30 of 2023 Page 66 of 88 possibility that there might come into operation at the same time and with reference to the same subject-matter two decrees which are inconsistent and contradictory. This, however, is not an exhaustive enumeration of the class of cases in which courts could interfere under Order 41 Rule 33. Such an enumeration would neither be possible nor even desirable.'
19. In the words of J.C. Shah, J. speaking for a three-
Judge Bench of this Court in Nirmala Bala Ghose Vrs. Balai Chand Ghose, AIR 1965 SC 1874 = (1965) 3 SCR 550 the limitation on discretion operating as bounds of the width of power conferred by Rule 33 can be so formulated: (AIR p. 1884, para 22) ‗The rule is undoubtedly expressed in terms which are wide, but it has to be applied with discretion, and to cases where interference in favour of the appellant necessitates interference also with a decree which has by acceptance or acquiescence become final so as to enable the court to adjust the rights of the parties. Where in an appeal the court reaches a conclusion which is inconsistent with the opinion of the court appealed from and in adjusting the right claimed by the appellant it is necessary to grant relief to a person who has not appealed, the power conferred by Order 41 Rule 33 may properly be invoked. The rule however does not confer an unrestricted right to reopen decrees which have become final merely because the appellate court does not agree with the opinion of the court appealed from.'
20. A Division Bench decision of the Calcutta High Court in Jadunath Basak Vrs. Mritunjoy Sett, AIR 1986 CRP No.30 of 2023 Page 67 of 88 Cal 416 = (1986) 2 CHN 44 may be cited as an illustration. The plaintiff filed a suit for declaration that the defendant had no right or authority to run the workshop with machines in the suit premises and for permanent injunction restraining the defendant from running the workshop. The trial court granted a decree consisting of two reliefs: (i) the declaration as prayed for, and (ii) an injunction permanently restraining the defendant from running the workshop except with the terms of a valid permission and licence under Sections 436 and 437 of the Calcutta Municipal Act, 1951 from the Municipal Corporation. The defendant filed an appeal. The Division Bench held that in an appeal filed by the defendant, the plaintiff cannot challenge that part of the decree which granted conditional injunction without filing the cross-objection. The Division Bench drew a distinction between the respondent‟s right to challenge an adverse finding without filing any appeal or cross- objection and the respondent seeking to challenge a part of the decree itself without filing the cross-objection. The Division Bench held that the latter was not permissible. We find ourselves in agreement with the view taken by the High Court of Calcutta.
321. In the case before us, the trial court found the plaintiff (in his suit) not entitled to decree for specific performance and found him entitled only for money decree. In addition, a conditional decree was also passed directing execution of sale deed if only the defendant defaulted any paying or depositing the money within two months. Thus to the extent of 3 [Ed.: Para 21 corrected as per Official Corrigendum No. F.3/Ed.B.J./65/2003] CRP No.30 of 2023 Page 68 of 88 specific performance, it was not a decree outright; it was a conditional decree. Rather, the latter part of the decree was a direction in terrorem so as to secure compliance by the appellant of the money part of the decree in the scheduled time-frame. In the event of the appellant having made the payment within a period of two months, the respondent would not be, and would never have been, entitled to the relief of specific performance. The latter decree is not inseparably connected with the former decree. The two reliefs are surely separable from each other and one can exist without the other. Nothing prevented the respondent from filing his own appeal or taking cross-objection against that part of the decree which refused straight away a decree for specific performance in his favour based on the finding of comparative hardship recorded earlier in the judgment. The dismissal of appeals filed by the appellant was not resulting in any inconsistent, iniquitous, contradictory or unworkable decree coming into existence so as to warrant exercise of power under Rule 33 of Order 41. It was not a case of interference with the decree having been so interfered with as to call for adjustment of equities between the respondents inter se. By his failure to prefer an appeal or to take cross-objection the respondent has allowed the part of the trial court's decree to achieve a finality which was adverse to him.‖ 11.8. In the present case, from the Order dated 15.11.2017 passed by this Court while disposing of Misc. Case No.373 of 2016-- in connection with Judgment dated 08.09.2016 passed in RSA No.373 of 2013 (Jyoti CRP No.30 of 2023 Page 69 of 88 Prakash Das Vrs. Industrial Promotion and Investment Corporation of Odisha Ltd.) wherein the present petitioner was arrayed as one of the respondents- opposite parties (respondent No.6-defendant No.5)-- it can be perceived that the judgment in second appeal is confined to inter se Jyoti Prakash Das and Industrial Promotion and Investment Corporation of Odisha Ltd., and the appellate order dated 19.07.2013 of the District Judge, Cuttack in RFA No.34 of 2012 does hold the field. Perusal of the appellate order dated 19.07.2013 indicates that the judgment and decree passed against the appellant therein (defendant No.6-IPICOL before learned trial court) "is only set aside, but will remain as such against the other defendants". Under such premise, there is no scope for the learned Executing Court to reopen the issue, but to proceed in accordance with the judgment and decree which remained intact as against present petitioner-OSFC, which was the defendant No.5 before the trial Court-respondent No.6 before the appellate Court and respondent No.6 in the second appeal before this Court.
11.9. Having not taken the judgment and decree in further proceeding by availing remedial measure under the CPC, the petitioner-OSFC has acquiesced with the same, whereas other defendant, viz., IPICOL, had preferred appeal. Even though it was pleaded as party before the CRP No.30 of 2023 Page 70 of 88 appellate Court and has knowledge about the order dated 19.07.2013 passed by the learned District Judge, Cuttack in RFA No.34 of 2012, it is believed on the facts borne on record that the OSFC has acquiesced with the judgment and decree dated 24.12.2011 passed by the 2nd Additional Senior Civil Judge, Cuttack. Therefore, at the stage of execution under Section 47 of the CPC, it is unwholesome for it to question the validity of said judgment and decree dated 24.12.2011.
11.10. Acquiescence must be made applicable in a case where the order has been passed and accepted without raising any objection. Estoppel follows acquiescence. It has been elaborately discussed in Power Control Appliances Vrs. Sumeet Machines Pvt. Ltd., (1994) 1 SCR 708 = (1994) 2 SCC 448 as follows: (extracted from SCC) ―26. Acquiescence is sitting by, when another is invading the rights and spending money on it. It is a course of conduct inconsistent with the claim for exclusive rights in a trade mark, trade name etc. It implies positive acts; not merely silence or inaction such as is involved in laches. In Harcourt Vrs. White, (1860) 28 Beav 303 = 54 ER 382, Sr. John Romilly said:
„It is important to distinguish mere negligence and acquiescence.‟ Therefore, acquiescence is one facet of delay. If the plaintiff stood by knowingly and let the defendants CRP No.30 of 2023 Page 71 of 88 build up an important trade until it had become necessary to crush it, then the plaintiffs would be stopped by their acquiescence. If the acquiescence in the infringement amounts to consent, it will be a complete defence as was laid down in Mouson (J.G.) & Co. Vrs. Boehm, (1884) 26 Ch D 406. The acquiescence must be such as to lead to the inference of a licence sufficient to create a new right in the defendant as was laid down in Rodgers Vrs. Nowill, (1847) 2 De GM&G 614 = 22 LJ KCH 404.
27. The law of acquiescence is stated by Cotton, L.J. in Proctor Vrs. Bannis, (1887) 36 Ch D 740 as under:
‗It is necessary that the person who alleges this lying by should have been acting in ignorance of the title of the other man, and that the other man should have known that ignorance and not mentioned his own title.' In the same case Bowen, L.J. said:
‗In order to make out such acquiescence it is necessary to establish that the plaintiff stood by and knowingly allowed the defendants to proceed and to expend money in ignorance of the fact that he had rights and means to assert such rights.'
28. In Devidoss and Co., AIR 1941 Mad 31 at pages 33 and 34 the law is stated thus:
‗To support a plea of acquiescence in a trade mark case it must be shown that the plaintiff has stood by for a substantial period and thus encouraged the defendant to expend money in building up a business associated with the mark. In Rowland Vrs. Michell, (1896) 13 RPC 464, Romer J. observed:CRP No.30 of 2023 Page 72 of 88
‗If the plaintiff really does stand by and allow a man to carry on business in the manner complained of to acquire a reputation and to expend money he cannot then after a long lapse of time, turn round and say that the business ought to be stopped.' ' In the same case, but on appeal Lord Russel, C.J. said Rowland Vrs. Michell, (1897) 14 RPC 37, 43 at p. 43:
‗Is the plaintiff disentitled to relief under that head by injunction because of acquiescence? Of course it is involved in the consideration of that that the plaintiff has a right against the defendant and that the defendant has done him a wrong and the question is whether the plaintiff has so acted as to disentitle him from asserting his right and from seeking redress from the wrong which has been done to him. Cases may occasionally lay down principles and so forth which are a guide to the court, but each case depends upon its own circumstances.
Dealing with the question of standing by in Codes Vrs. Addis and Son, (1923) 40 RPC 130, 142 at p. 142, Eve, J. said:
‗For the purpose of determining this issue I must assume that the plaintiffs are traders who have started in this more or less small way in this country, and have been continuously carrying on this business. But I must assume also that they have not, during that period, been adopting a sort of Rip Van Winkle policy of going to sleep and not watching what their rivals and competitors in CRP No.30 of 2023 Page 73 of 88 the same line of business were doing. I accept the evidence of any gentleman who comes into the box and gives his evidence in a way which satisfies me that he is speaking the truth when he says that he individually did not know of the existence of a particular element or a particular factor in the goods marketed by his opponents. But the question is a wider question than that : ought not he to have known : is he entitled to shut his eyes to everything that is going on around him, and then when his rivals have perhaps built a very important trade by the user of indicia which he might have prevented their using had he moved in time, come to the Court and say :
„Now stop them from doing it further, because a moment of time has arrived when I have awakened to the fact that this is calculated to infringe my rights.‟ Certainly not. He is bound, like everybody else who wishes to stop that which he says is an invasion of his rights, to adopt a position of aggression at once, and insist, as soon as the matter is brought to Court, it ought to have come to his attention, to take steps to prevent its continuance; it would be an insufferable injustice were the Court to allow a man to lie by while his competitors are building up an important industry and then to come forward, so soon as the importance of the industry has been brought home to his mind, and endeavour to take from them that of which they had legitimately made use; every day when they used it satisfying them more and more that CRP No.30 of 2023 Page 74 of 88 there was no one who either could or would complain of their so doing. The position might be altogether altered had the user of the factor or the element in question been of a secretive or surreptitious nature; but when a man is openly using, as part of his business, names and phrases, or other elements, which persons in the same trade would be entitled, if they took steps, to stop him from using, he gets in time a right to sue them which prevents those who could have stopped him at one time from asserting at a later stage their right to an injunction.' In Mc. Caw Stevenson & Orr Ltd. Vrs. Lee Bros., (1960) 23 RPC 1 acquiescence for four years was held to be sufficient to preclude the plaintiff from succeeding. In 1897 the plaintiffs in that case registered the word ‗glacier' as a trade mark in respect of transparent paper as a substitute for stained glass. As the result of user the word had become identified with the plaintiffs' goods. In 1900 the defendants commenced to sell similar goods under the name ‗glazine.' In 1905 the plaintiffs commenced an action for infringement. The defendants denied that the use of the word ‗glazine' was calculated to deceive and also pleaded acquiescence. A director of the plaintiff company admitted that he had known of the use of the word ‗glazine' by the defendants for four years-- he would not say it was not five years. It was held that the plaintiffs failed on the merits and by reason of their delay in bringing the action.
Delay simpliciter may be no defence to a suit for infringement of a trade mark, but the decisions to CRP No.30 of 2023 Page 75 of 88 which I have referred to clearly indicate that where a trader allows a rival trader to expend money over a considerable period in the building up of a business with the aid of a mark similar to his own he will not be allowed to stop his rival's business. If he were permitted to do so great loss would be caused not only to the rival trader but to those who depend on his business for their livelihood. A village may develop into a large town as the result of the building up of a business and most of the inhabitants may be dependent on the business. No hard and fast rule can be laid down for deciding when a person has, as the result of inaction, lost the right of stopping another using his mark. As pointed out in Rowland Vrs. Michell, (1897) 14 RPC 37, 43 each case must depend on its own circumstances, but obviously a person cannot be allowed to stand by indefinitely without suffering the consequence.'
29. This is the legal position. Again in Halsbury's Laws of England, Fourth Edn., Vol. 24 at paragraph 943 it is stated thus:
‗943. Acquiescence.--
An injunction may be refused on the ground of the plaintiff's acquiescence in the defendant's infringement of his right. The principles on which the court will refuse interlocutory or final relief on this ground are the same, but a stronger case is required to support a refusal to grant final relief at the hearing. [Patching Vrs. Dubbins, (1853) Kay 1 = 69 ER 1; Child Vrs. Douglas, (1854) 5 De GM&G 739 = 43 ER 1057; Johnson Vrs. Wyatt, (1863) 2 De GJ&Sm 18 = 46 ER 281; Turner Vrs. Mirfield, (1865) 34 CRP No.30 of 2023 Page 76 of 88 Beav 390 = 55 ER 685; Hogg Vrs. Scott, (1874) LR 18 Eq 444; Price Vrs. Bala and Festiniog Rly. Co., (1884) 50 LT 787] The reason is that at the hearing of the cause it is the court's duty to decide upon the rights of the parties, and the dismissal of the action on the ground of acquiescence amounts to a decision that a right which once existed is absolutely and for ever lost: Johnson Vrs.
Wyatt, (1863) 2 De GJ&Sm 18 = 46 ER 281 at 25; and see Gordon Vrs. Cheltenham and Great Western Union Rly. Co., (1842) 5 Beav 229, 233 : 49 ER 565 per Lord Langdale MR.‖ ***
32. Amritdhara Pharmacy Vrs. Satyadeo Gupta, (1963) 2 SCR 484 = AIR 1963 SC 449 is a case where Halsbury was quoted with approval. However, on the facts of that case it was held that the plea of acquiescence had not been made out.‖ 11.11. Regard be had to The Chairman, State Bank of India Vrs. M. J. James, (2021) 7 SCR 373, wherein it has been enunciated as follows:
―29. Before proceeding further, it is important to clarify distinction between ‗acquiescence' and ‗delay and laches'. Doctrine of acquiescence is an equitable doctrine which applies when a party having a right stands by and sees another dealing in a manner inconsistent with that right, while the act is in progress and after violation is completed, which conduct reflects his assent or CRP No.30 of 2023 Page 77 of 88 accord. He cannot afterwards complain. [See Prabhakar Vrs. Joint Director, Sericulture Department and Another, (2015) 15 SCC 1. Also, see Gobinda Ramanuj Das Mohanta Vrs. Ram Charan Das and Suyamal Das, AIR 1925 Cal 1107.] In literal sense, the term acquiescence means silent assent, tacit consent, concurrence, or acceptance,4 which denotes conduct that is evidence of an intention of a party to abandon an equitable right and also to denote conduct from which another party will be justified in inferring such an intention.5 Acquiescence can be either direct with full knowledge and express approbation, or indirect where a person having the right to set aside the action stands by and sees another dealing in a manner inconsistent with that right and in spite of the infringement takes no action mirroring acceptance.6 However, acquiescence will not apply if lapse of time is of no importance or consequence.
30. Laches unlike limitation is flexible. However, both limitation and laches destroy the remedy but not the right. Laches like acquiescence is based upon equitable considerations, but laches unlike acquiescence imports even simple passivity. On the other hand, acquiescence implies active assent and is based upon the rule of estoppel in pais. As a form of estoppel, it bars a party afterwards from complaining of the violation of the right. Even indirect acquiescence implies almost active consent, which is not to be 4 See Vidyavathi Kapoor Trust Vrs. Chief Commissioner Tax, (1992) 194 ITR 584. 5 See Krishan Dev Vrs. Smt. Ram Piari AIR 1964 HP 34. 6 See ―Introduction‖, UN Mitra, Tagore Law Lectures- Law of Limitation and Prescription, Volume I, 14TH Edition, 2016.CRP No.30 of 2023 Page 78 of 88
inferred by mere silence or inaction which is involved in laches. Acquiescence in this manner is quite distinct from delay. Acquiescence virtually destroys the right of the person.7 Given the aforesaid legal position, inactive acquiescence on the part of the respondent can be inferred till the filing of the appeal, and not for the period post filing of the appeal. Nevertheless, this acquiescence being in the nature of estoppel bars the respondent from claiming violation of the right of fair representation.‖ 11.12. The record evinces that having participated in the suit proceeding and being impleaded as party in both the appeals, the petitioner-OSFC had the knowledge about the judgment and decree against it. At the stage of execution proceeding, it seeks to avail the benefit that has been held out in favour of the one of the defendants, namely IPICOL. Clear acquiescence being manifest from the conduct of the petitioner, it cannot be granted any relief at this distance of time to protract litigation any further. Reference can be had to caveat issued in Rahul S. Shah Vrs. Jitendra Kumar Gandhi, (2021) 4 SCR 279.
11.13. Referring to said reported judgment in Rahul S. Shah (supra) further observations are made in Pradeep Mehra Vrs. Harijivan J. Jethwa, (2023) 14 SCR 123, wherein it has been stated thus:
7 Vidyavathi Kapoor Trust Vrs. Chief Commissioner Tax, (1992) 194 ITR 584.CRP No.30 of 2023 Page 79 of 88
―5. A bare perusal of the aforesaid provision8 shows that all questions between the parties can be decided by the executing court. But the important aspect to remember is that these questions are limited to the "execution of the decree". The executing court can never go behind the decree. Under Section 47, CPC the executing court cannot examine the validity of the order of the court which had allowed the execution of the decree in 2013, unless the court‟s order is itself without jurisdiction. More importantly this order (the order dated 12.02.2013), was never challenged by the tenants/judgment debtors before any forum. The multiple stages a civil suit invariably has to go through before it reaches finality, is to ensure that any error in law is cured by the higher court. The appellate court, the second appellate court and the revisional court do not have the same powers, as the powers of the executing court, which are extremely limited. This was explained by this Court in Dhurandhar Prasad Singh Vrs. Jai Prakash University and Others, (2001) 6 SCC 534, in para 24, it had stated thus:
‗24. *** The exercise of powers under Section 47 of the Code is microscopic and lies in a very narrow inspection hole. Thus, it is plain that executing court can allow objection under Section 47 of the Code to the executability of the decree if it is found that the same is void ab initio and a nullity, apart from the ground that the decree is not capable of execution under law either because the same was passed in ignorance of such a provision of law or the law 8 Section 47 of the Code of Civil Procedure, 1908.CRP No.30 of 2023 Page 80 of 88
was promulgated making a decree inexecutable after its passing.' This Court noted further:
‗*** The validity or otherwise of a decree may be challenged by filing a properly constituted suit or taking any other remedy available under law on the ground that the original defendant absented himself from the proceeding of the suit after appearance as he had no longer any interest in the subject of dispute or did not purposely take interest in the proceeding or colluded with the adversary or any other ground permissible under law.' ‖
6. The reality is that pure civil matters take a long time to be decided, and regretfully it does not end with a decision, as execution of a decree is an entirely new phase in the long life of a civil litigation. The inordinate delay, which is universally caused throughout India in the execution of a decree, has been a cause of concern with this Court for several years.
In Rahul S. Shah Vrs. Jinendra Kumar Gandhi and Others (2021) 6 SCC 418, this Court had observed that a remedy which is provided for preventing injustice (in the Civil Procedure Code) is in fact being misused to cause injustice by preventing timely implementation of orders and execution of decrees. Then, it had observed as under:
‗23. *** The execution proceedings which are supposed to be a handmaid of justice and subserve the cause of justice are, in effect, CRP No.30 of 2023 Page 81 of 88 becoming tools which are being easily misused to obstruct justice.' The above judgment is an important judgment in respect of Section 47 as well as Order XXI, CPC as the three Judge Bench decision of this Court not only condemned the abuse of process done in the garb of exercise of powers under Section 47 read with Order XXI, CPC, but also gave certain directions to be followed by all Civil Courts in their exercise of powers in the execution of a decree. It further directed all the High Courts to update and amend their Rules relating to the execution of decrees so that the decrees are executed in a timely manner. As far as Section 47 is concerned, this Court had stated as under:
‗24. In respect of execution of a decree, Section 47 CPC contemplates adjudication of limited nature of issues relating to execution i.e. discharge or satisfaction of the decree and is aligned with the consequential provisions of Order 21 CPC. Section 47 is intended to prevent multiplicity of suits. It simply lays down the procedure and the form whereby the court reaches a decision. For the applicability of the section, two essential requisites have to be kept in mind. Firstly, the question must be the one arising between the parties and secondly, the dispute relates to the execution, discharge or satisfaction of the decree. Thus, the objective of Section 47 is to prevent unwanted litigation and dispose of all objections as expeditiously as possible.CRP No.30 of 2023 Page 82 of 88
25. These provisions contemplate that for execution of decrees, executing court must not go beyond the decree. However, there is steady rise of proceedings akin to a retrial at the time of execution causing failure of realisation of fruits of decree and relief which the party seeks from the courts despite there being a decree in their favour. Experience has shown that various objections are filed before the executing court and the decree-
holder is deprived of the fruits of the litigation and the judgment-debtor, in abuse of process of law, is allowed to benefit from the subject- matter which he is otherwise not entitled to.
26. The general practice prevailing in the subordinate courts is that invariably in all execution applications, the courts first issue show-cause notice asking the judgment-debtor as to why the decree should not be executed as is given under Order 21 Rule 22 for certain class of cases. However, this is often misconstrued as the beginning of a new trial. For example, the judgment-debtor sometimes misuses the provisions of Order 21 Rule 2 and Order 21 Rule 11 to set up an oral plea, which invariably leaves no option with the court but to record oral evidence which may be frivolous. This drags the execution proceedings indefinitely.' This Court then gave certain directions, which were to be mandatorily followed by all Courts dealing with civil suits and execution proceedings. Two of its directions were as follows:
CRP No.30 of 2023 Page 83 of 88‗42. *** 42.8. The court exercising jurisdiction under Section 47 or under Order 21 CPC, must not issue notice on an application of third party claiming rights in a mechanical manner. Further, the court should refrain from entertaining any such application(s) that has already been considered by the court while adjudicating the suit or which raises any such issue which otherwise could have been raised and determined during adjudication of suit if due diligence was exercised by the applicant. *** 42.12. The executing court must dispose of the execution proceedings within six months from the date of filing, which may be extended only by recording reasons in writing for such delay.
42.13. ***' It further directed all the High Courts to update their Rules relating to execution of decrees. It was as under:
‗43. We further direct all the High Courts to reconsider and update all the Rules relating to execution of decrees, made under exercise of its powers under Article 227 of the Constitution of India and Section 122 CPC, within one year of the date of this order. The High Courts must ensure that the Rules are in consonance with CPC and the above directions, with an endeavour to expedite the process of execution with the use of information technology tools. Until such time these Rules are brought into CRP No.30 of 2023 Page 84 of 88 existence, the above directions shall remain enforceable.' We have referred to the above decision of this Court only to highlight the slow process in the execution of a decree and the concern of this Court, and its efforts in the past, to improve this situation.‖ 11.14. Such being the anxious consideration of the Hon'ble Supreme Court of India, it may be observed that the suit was for payment of an amount of Rs. 1,70,000 pertaining to supply of electrical goods and installation work undertaken by the opposite party during the year 1983-84. Though the judgment and decree were passed way back in 2011, the petitioner-OSFC did not question the legality before any higher court till date even as it was impleaded as party in the appeal filed by IPICOL and the second appeal, at the behest of the opposite party.
Conclusion:
12. For the fact that the opposite party having not questioned the validity of judgment and decree passed by the 2nd Additional Senior Civil Judge, Cuttack in TMS No.747 of 1989, the petitioner cannot hide behind the screen of judgment dated 19.07.2013 of the District Judge, Cuttack in RFA No.34 of 2012.
12.1. The Supreme Court in Merla Ramanna Vrs. Nallaparaju, AIR 1956 SC 87 = (1955) 2 SCR 938 has observed that CRP No.30 of 2023 Page 85 of 88 for Section 47 of the Code of Civil Procedure, 1908, to apply the following conditions must be satisfied:
(i) The questions must be one arising between the parties to the suit in which the decree is passed, or their representatives; and
(ii) It must relate to the execution, discharge or satisfaction of the decree.
12.2. In State of Punjab Vrs. Mohinder Singh Randhawa, AIR 1992 SC 473 = (1993) Supp.(1) SCC 49, it has been laid down that in the absence of any challenge to the appellate decree in further proceedings, in execution this is not open to challenge.
12.3. There is no quarrel with the general proposition of law and indeed, it is unexceptionable that a court executing a decree cannot go behind the decree; it must take the decree according to its tenor; has no jurisdiction to widen its scope and is required to execute the decree as made. [Century Textiles Industries Ltd. Vrs. Deepak Jain, (2009) 5 SCC 634 = (2009) 4 SCR 750].
12.4. Said principle has been reiterated in Kanwar Singh Saini Vrs. High Court, Delhi, (2011) 15 Addl. SCR 972 = (2012) 4 SCC 307 and it has been held that it is a settled legal proposition that the executing court does not have the power to go behind the decree. Thus, in absence of any CRP No.30 of 2023 Page 86 of 88 challenge to the decree, no objection can be raised in execution. When a statute gives a right and provides a forum for adjudication of rights, remedy has to be sought only under the provisions of that Act. When an Act creates a right or obligation and enforces the performance thereof in a specified manner, that performance cannot be enforced in any other manner. Thus for enforcement of a right/obligation under a statute, the only remedy available to the person aggrieved is to get adjudication of rights under the said Act.
12.5. Thus, the condition for the applicability of Section 47 is that the question must relate to execution, discharge or satisfaction of the decree. Any question, which hinders or in any manner affects execution of the decree, is covered by Section 47 of the CPC.
13. The question posed herein above with respect to issue involved in the case at hand, can be answered to the effect that on dismissal of second appeal filed by the decree-holder (opposite party herein) against the one of the defendants before the trial Court in the suit (IPICOL), and the judgment of the appellate Court holding that the IPICOL is not liable to discharge the decree inasmuch as there was no privity of contract between the IPICOL- defendant No.6 and the opposite party (plaintiff-decree holder) attained finality, the decree is enforceable as CRP No.30 of 2023 Page 87 of 88 against other defendants namely the OSFC-defendant No.5, which did choose not to prefer appeal questioning the decree or judgment of the 2nd Additional Senior Civil Judge, Cuttack.
14. In the light of the above discussion taking note of factual details and arguments as put forth by counsel for respective parties and reasons ascribed to supra, this Court finds no merit in the present civil revision petition. The petitioner has failed to demonstrate any jurisdictional error, perversity, or substantial illegality in the findings of the learned 2nd Additional Senior Civil Judge that would entail indulgence in exercise power of conferred under Section 115 of the CPC on this Court to invoke revisional jurisdiction.
15. In the result, the Order dated 15.07.2023 passed in CMA No.145 of 2021 by the learned 2nd Additional Senior Civil Judge, Cuttack does not warrant interference; as a consequence thereof, the civil revision petition, accordingly, stands dismissed with no order as to costs.
(MURAHARI SRI RAMAN) JUDGE High Court of Orissa, Cuttack The 11th November, 2024//MRS/Laxmikant/Suchitra Signature Not Verified Digitally Signed Signed by: SUCHITRA BEHERA Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: HIGH COURT OF ORISSA, CUTTACK Date: 11-Nov-2024 15:08:09 CRP No.30 of 2023 Page 88 of 88