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6 Mr. Chhagla, learned Senior Advocate of the Plaintiff, submits that every appeal is a continuation of the original proceeding filed 3 AIR 1958 SC 1036 4 AIR 1958 SC 86 Chittewan 7/21 1. NMCD 119-16.doc before the court of first instance; the order of the first court in our case setting aside the arbitral award being in appeal, the same has not achieved finality. Learned Counsel submits that the appellate court may either set aside that order, in which case, the award may survive, or affirm the order, in which case it may stand set aside; it is only the final order affirming such setting aside, which makes it final and stops running of the exclusion period provided under Section 43(4) of the Act. Learned Counsel relies on the cases of Lachmeshwar Prasad Shakul Vs. Keshwar Lal Chaudhuri 5 and Union of India Vs. Varindera Constructions Limited6 in support of his submission. Learned Counsel contends that the case of Mohammed Nooh (supra) relied upon by Mr. Khambata was only in the context of a departmental order passed by a domestic authority, which could not be equated to a civil court of first instance. Learned Counsel relies on the cases of Madan Gopal Rungta Vs. Tata Iron and Steel Co. Ltd.7, Collector of Customs, Calcutta Vs. East India Commercial Co. Ltd.8 and Gojer Bros (Pvt) Ltd Vs. Shri Ratal Lal Singh Ltd.9, in support of his submission that Mohammad Nooh was a special case, which stands on its own facts. Learned Counsel relies on direct authorities of the High Courts of Rajasthan, Punjab & Haryana and Andhra Pradesh in the cases of Babulal Vs. Ramswaroop10, The State 5 [1940] Federal Court Reports 84 6 (2020) 2 SCC 111 7 1962 Supp (3) SCR 906 8 (1963) 2 SCR 563 9 (1974) 2 SCC 453 10 AIR 1960 Raj 240 Chittewan 8/21 1. NMCD 119-16.doc of Uttar Pradesh Vs. Pearl Hosiery Mills 11, State of Punjab Vs. Nand Kishore12 and S. Seshadri Vs. H.N. Narasihmadass13, in support of his submission that the expression "the date of the order of the court"

11 In the case of Mohammad Nooh (supra) relied upon by Mr. Khambata, the original order of dismissal was passed against the respondent, a police constable, by the District Superintendent of Police under the applicable police regulations. The order was passed on April 20, 1948. The respondent challenged that order first in appeal Chittewan 13/21 1. NMCD 119-16.doc before the Deputy Inspector General and then in revision before the Inspector General of Police, also under the same regulations. The last order, passed by the Inspector General, was on April 22, 1950. Having exhausted all departmental remedies, the respondent challenged his dismissal in a writ petition before the Allahabad High Court under Article 226 of the Constitution. The appellant-State raised a preliminary objection to the High Court exercising powers under Article 226 in the matter. The original order of dismissal, so argued the state, was passed before the Constitution came into force and was not amenable to a challenge under Article 226 of the Constitution. In reply, the respondent claimed that what was challenged was the last order (of the Inspector General) passed on April 22, 1950, i.e. after the Constitution was brought into force. The Supreme Court (per majority) repelled the respondent's contention. The court held that, firstly, there was no propriety in applying the doctrine of merger to departmental orders, since departmental tribunals, whether of the first instance or of appeal or revision, were not regular courts and their orders could not be equated with decrees of the first court or appellate or revisional orders of superior courts; secondly, there was nothing in the Indian law to warrant the suggestion that the decree or order of the court or tribunal of first instance become final only on the termination of all proceedings by way of appeal or revision. The court held that the original order of dismissal, absent any inherent infirmities in it, was operative on its own strength and did not gain any greater efficacy from the Chittewan 14/21 1. NMCD 119-16.doc subsequent orders in appeal or revision. The court held that the original order of dismissal, which always operated, having been passed before the Constitution and rights having accrued to the appellant state and liabilities correspondingly attached to the respondent before the Constitution came into force, the subsequent conferment of jurisdiction and powers on the High court would have no retrospective operation on such rights and liabilities. Mr. Khambata, relies on the latter proposition laid down in Mohammad Nooh's case, namely, that there was nothing in Indian law to warrant the suggestion that the decree of a court of the first instance becomes final only on the termination of all proceedings by way of appeal or revision.

12 Mohammad Nooh's case is, in the first place, distinguishable on its own special facts and circumstances. In fact, in its subsequent judgments, the Supreme Court has itself said so. In Madan Gopal Rungta (supra), the Government of Orissa had rejected the appellant's application for a mining lease. A review of that order under the applicable rules was rejected by the Central Government. The appellant's challenge in that behalf under Article 226 of the Constitution was repelled by the Orissa High Court on the ground that it had no jurisdiction, since the final order in that case was passed by the Central Government, which was located beyond its territorial jurisdiction. The appellant cited Mohammad Nooh in support of his case that the order of the State Government operated on its own Chittewan 15/21 1. NMCD 119-16.doc strength and did not merge with the Central Government order. The Supreme Court did not accept the appellant's submission, holding that the principle of Mohammed Nooh's case would not apply to the case before it. The court was of the view that the facts in Mohammed Nooh were of a special kind and the reasoning in that case would not apply to the appellant's case. This observation was reiterated in the subsequent case of East India Commercial Co. Ltd. (supra). In East India Commercial Co. Ltd., the question before the court was, whether the order passed by the Collector of Customs, Calcutta, which was taken in appeal before the Central Board of Revenue, which was not amenable to the jurisdiction of Calcutta High Court, could be interfered with by that High Court. The Supreme Court held that the order of the original authority must be held to have merged in the order of the appellate authority which alone operated after the appeal was disposed of. Apropos Mohammad Nooh (supra), which was cited against the application of the doctrine of merger, the Supreme Court, in terms, observed that as was pointed out in Madan Gopal Rungta case (supra), "Mohammad Nooh case was a special case, which stands on its own facts." The court held that in Mohammad Nooh's case, the fact that the dismissal of the employee was before the Constitution came into force meant that "even if the principle of merger were applicable to an order of dismissal like the one in Mohammad Nooh case the fact would still remain that the dismissal was before the Constitution came into force and therefore, the person dismissed could not take advantage of the provisions of the Constitution, so far as Chittewan 16/21 1. NMCD 119-16.doc that dismissal was concerned." On the question of merger and the finality and operative nature of the appellate order, in particular, this is what the court had to say in East India Commercial Co. Ltd. :

The principle of merger was once again applied by the Supreme Court, after referring to the cases of Madan Gopal Rungta and East India Commercial Co. Ltd., in Gojar Bros. (Pvt. ) Ltd. (supra).

13 Defendant No.1, in the present case, thus cannot benefit from Mohammad Nooh case (supra), the principle of which must be restricted to the peculiar facts of that case. In any event, even Mohammad Nooh case acknowledges that the doctrine of merger does operate in full force for certain purposes, namely, for the purposes of computing the period of limitation for execution of a decree, or for computing the period of limitation for an application for final decree in a mortgage suit. As we have noted above, the principle of merger would most certainly operate for computing the exclusion period under Section 43(4) of the Act for reckoning the limitation period for a suit or arbitration proceeding in case of a dispute referred to arbitration where an award is set aside by the court. The provision would be unworkable, as noticed above, without invoking the principle of merger.