On an Order of Reference to the Full Bench by Subba Rao and Krishna-swami Nayudu. JJ. on 24-10-1950, the Court expressed the following:
OPINION.
The Chief Justice.—The question referred for decision by a Full Bench runs as follows:
“Whether the words ‘substantial question of law’ occurring in Art. 133 of the Constitution of India mean an important or difficult question of law or any question of law affecting the rights of parties?”
The question as framed appears to contemplate only two alternatives, namely, that either it should be held that every question of law affecting the rights of parties is a substantial question of law, or it is only an important or difficult question of law that would come within that description. It became evident during the course of the argument that the two alternatives are not exhaustive and there may be questions which though they may not be very important or difficult, could nevertheless be called substantial questions. Actually in the order of reference there is a third category indicated in the following passage:
“Unless a question of law is one of importance and difficulty or in regard to which there is a reasonable doubt or difference of opinion it cannot be a substantial question of law within the meaning of the article.”
The condition that, where the judgment, decree or final order appealed from affirms the decision of the Court immediately below, the High Court should also be satisfied that the appeal involves some substantial question of law before it can grant leave to appeal against a decision of the High Court to the Supreme Court, is the identical condition imposed in respect of an appeal to the Judicial Committee of the Privy Council under S. 110 Civil Procedure Code (hereinafter referred to as the Code). This condition which is found in the Codes from 1877 onwards was for the first time introduced lay the Privy Council Appeals Act No. VI of 1874, S. 5 which enacted that,
“Where the decree appealed from affirms the decision of the Court immediately below the Court passing such decree the appeal must involve some substantial question of law.”
In the Code of 1877, S. 596 contained the corresponding provision in exactly similar terms. It may be not without interest to mention that the validity of this provision was attacked on the ground that it was ultra vires of the power of the Indian Legislature as being curtailment of the jurisdiction given to the High Court by the Letters Patent, but it was held not to be so (Vide In the matter of Feda Hossein and Co.,(1) S. 596 of the Code of 1882 and S. 110 of the Code of 1908 merely reproduced the original provision except that in the Code of 1908 the words “or final order” were added after “the decree”.
The question when an appeal could be held to involve some substantial question of law did come up before the Courts in India soon after the Act of 1874. It was decided as early as Moran v. Mittu Bibee (2), that the sustantial question of law need not be restricted to questions arising on the facts found concurrently by the Courts below but may include a question arising on the evidence independently of the finding of the Courts upon such evidence. It was also recognised from the very beginning that in dealing with an application for leave to appeal it is not enough to grant a certificate that it appears from the grounds of appeal that a question of law is involved; the Court must also find that there really is a substantial question of law raised. (See Broughton's Commentaries on the Civil Procedure Code, 1878, page 704 citing a decision of Markby, J., in 1874).
It becomes therefore important to determine what exactly is connoted by the word “substantial” in the context. Now, the word “substantial” has two distinct shades of meaning. It means “essential, material”. In legal parlance, it often is understood as “belonging to or involving an essential right or the merits of a matter” (See Warton's Law Lexicon). The word also means “having substance; real worth” (See Oxford Dictionary). In Ss. 10 and 11 of the Code the word “substantially” is used in the former sense of “materially” “essentially” i.e, not incidentally.
Obviously, a question of law of general public importance, the decision of which is likely to affect a large section of the public, will be a substantial question of law. A question of law on which there is great divergence of judicial opinion will be a substantial question of law. A view was taken in the Indian Courts that it is only when an appeal to the Privy Council involves a question of this nature and it is likely that the appeal may result in the enunciation of new legal principles or the resolving of the conflict of judicial opinion that leave should be granted on the ground that there is a substantial question of law. This view is well represented in an appeal which went up to the Privy Council from the Chief Court of Oudh. In Raghurnath Prasad v. Duputy Commissioner of Partabgarh (3), the learned Judges of the Chief Court of Oudh after pointing out that the only question of law arising was as to the true construction of a will said,
“That, to our minds, is not a ‘substantial question of law’ though it is a question of law. It is not alleged that any recognised principle applicable to the construction of a document of the nature of the present will has been misunderstood or misused by this Court, nor does our decision lay down any general principle of construction. The construction which we have placed upon the will in question is of no interest to any person outside the parties to this litigation. The old Court of the Judicial Commissioner of Oudh, to which the Court has succeeded, consistently adhered to the view that the words “substantial question of law” means a question of general importance and do not include the construction of a document in which the parties alone are interested.”
The learned Judges therefore dismissed the application for leave. There was then a petition for special leave to appeal in which their Lordships considered whether the matter fell within the last clause of S. 110 of the Code. Their Lordships ruled that a substantial question of law did not mean a question of general importance but that it meant “a substantial question of law as between the parties in the case involved.” An attempt was made by the Counsel for the respondent to show that on the merits the decision of the Court below was obviously right, and therefore there was no substantial question of law, but his attempt did not succeed. Their Lordships did not think that it would be quite safe in taking that view in a case which certainly occupied the Court below for a very long time and on which there was a very elaborate judgment; they thought that upon the face of the matter there was, as between the parties, a substantial question of law. In Guran Ditta v. Ram Ditta the question was whether a deposit made by a Hindu of his money in a bank in the joint names of himself and his wife on condition that it was payable to either or the survivor, constituted a gift by him to his wife. The Judicial Commissioner of North West Frontier Province refused an application for leave to appeal, but special leave to appeal was granted by the Board. At page 949, their Lordships refer to what was decided in Raghunath Prasad Singh v. Deputy Commissioner of Partabgarh in these terms:
“In the case of Raghunath Prasad Singh v. Deputy Commissioner of Partabgarh it was held that a substantial question of law, within the last clause of S. 110 C.P.C does not mean a substantial question of general importance but a substantial question of law as between the parties in the case involved.”
It must therefore be taken as now conclusively settled under the Code (and the same must hold good in construing Art. 133 of the Constitution) that a substantial question of law need not be a question of general importance, It is sufficient if it arises between the parties. This, however, does not mean that every question of law as between the parties is a substantial question of law. In the paraphrase by the Privy Council the word “substantial” again occurs in addition to the phrase “as between the parties.” It has been held time and again and we have not come across any authority to the contrary, that any question of law is not as such a substantial question of law if it arises between the parties. Nor did we understand Mr. Narasaraju who appeared for the petitioner to argue for the contrary though probably that was his line of argument before the learned referring Judges. Otherwise, the question would not have been framed as it has been. It may be argued that a question of law the decision of which materially affects the rights of the parties is a substantial question of law. If it is merely incidental and does not affect the merits in essentials, then it will not be a substantial question. This test is no doubt simple and easy to apply, but we do not think that this is the correct test. Logically this test would lead to the position that even a palpably absurd plea raised by a party would involve a substantial question of law simply because the decision on the merits of the case would be directly affected by it. We have also not come across any case in which this test has been adopted. But apparently the decision in Mahadeva Royal v. Chikka Royal was understood by the learned Judges who made the reference as accepting this test as correct. But before we deal with that decision, I think it will be useful to run over some of the decisions of this Court to find out how far the learned Judges in that case could be said to have differed from the principles laid down in them. I am leaving from consideration decisions which dealt with applications for leave on the ground that S. 109 Cl. (c) would apply. In Alakh Narayan v. Chinna Gogudu Ramesam and Madhavan Nair JJ. while accepting the proposition that the existence of a point of law by itself does not give a right of appeal to the Privy Council under S. 110 of the Code and that there must be a substantial question of law and that there need not be a question of general importance, held that a fairly arguable question of law, i.e, a question of law in respect of which there may be a difference of opinion would be a substantial question of law. In K.V Pandian v. Rev. Pignot the learned Judges were inclined to hold that a question as to the starting point of limitation might be a substantial question of law on the facts; they nevertheless refused to grant leave, because the decision of this Court was also based on another finding as to the effect of the resumption by the Government of a service inam and on that question the decisions were uniform. In Nallathambi Pillai v. Raghunath Bibi it was held by Mockett and Kunhi Rahman JJ. that as the only question of law raised in the appeal to the Privy Council was virtually covered by a decision of the Judicial Committee and there was no conflict of views in India on the question no substantial question of law could be said to be involved. They adopted the view of Page, C.J expressed in M.C Patail v. H.G Ariff(4) that unless it was fairly open to argument that the decision of the High Court on a question of law could have been otherwise, there will be no substantial question of law. In Chinnasami v. Nallappa Reddiar(5) another Division Bench ruled that there the principles of law on a point are well settled and the only question is the application of those legal principles to a particular set of facts, it cannot be said that a substantial question of law arises. The decision of the Allahabad High Court in Mathurakurmi v. Bagdeo Singh(6) and that of the Lahore High Court in Mussamat Umrao Bibi v. Ramkishen(7) were as follows:
These decisions may be taken to represent the more or less uniform view taken by this Court. Apparently it was contended before the referring. Judges that Mahadeva Royal v. Chikka Royal(8) laid down a different test. In that case the only ground on which leave was granted was that a question was raised as to the correctness of the decision of this Court that certain material documents were inadmissible in evidence. Undoubtedly, these documents were of great importance and if they had been held to be admissible, they might have affected the result of the appeal. It was urged on behalf of the respondent that there were no merits whatever in the contention in regard to their admissibility and therefore there could not be a substantial question of law. The learned Judges then said:
“We were of opinion that there was no substance in the contention advanced by the learned Advocate General; but if the words ‘substantial questions’ are to be understood in their being of substance to the parties we must hold that the decision in regard to the non admissibility of the documents is a substantial question which would entitle the petitioner to have a certificate.”
I must confess that I find it difficult to exactly comprehend the significance of this conclusion. This Court might hold against a particular contention on behalf of a party; at the same time it may be a fairly arguable one. It is not possible to say from what the learned Judges actually said whether they thought that the contention as to admissibility was arguable though they themselves found no merits in it. In Ramachandra Rao v. Narayana Rao I had to deal with this decision sitting with Yahya, Ali, J. and I said:
“We are not aware exactly what sort of objection was raised as regards the admissibility of documents in that case. But we do not understand that decision to lay down that whenever a question as to the admissibility of any document is raised in an appeal and that question is decided in one way, it follows ipso facto that there is a substantial question of law which would justify the grant of a certificate under S. 110, Civil Procedure Code.”
In pursuance of the leave granted the appeal was eventually heard and disposed of by the Privy Council in Mahadeva Royal v. Vira Basava Chikka Royal , but apparently no objection was taken before the Privy Council that leave should not have been granted. In my opinion the decision in Mahadeva Royal v. Chikka Royal should net be taken as an authority for the position that any question of law, a decision on which may affect materially the rights of the parties, is a substantial question of law within the meaning of S. 110 of the Code.
It is neither possible nor useful to attempt to exactly define terms like “substantial” “reasonable” and “just and equitable”. Ultimately it resolves into itself into their meaning that the Court considers to be substantial reasonable or just and equitable. The use of the adjective “substantial” makes it clear that any question of law as such would not justify the grant of a certificate under S. 110. It must be a substantial question; that is to say, the question must have some substance, i.e, worth or merit. Bearing this in mind in consideration of the authorities which I have cited leads to the following general principles. When a question of law is fairly arguable, when there is room for difference of opinion on it, then such a question would be a substantial question of law. If this Court thought it necessary to deal with a question of law at some length, and discuss alternative views which can be taken on the point, then, I think such a question would be a substantial question. When a point of law is practically covered by a decision of the highest authority Court, say, like the Privy. Council or the Supreme Court, then it would not be a substantial question. If the general principles to be applied in determining a question are well settled a mere application of such principles would not involve a substantial question of law. I am inclined to hold that when a particular set of facts can lead to alternative findings in law, then, a substantial question of law would be involved. If the principle to be applied or the point of law arising in the case is not well established, then certainly that would be a substantial question of law. With great respect to the learned Judges who appear to hold to the contrary, I am of opinion that if there is conflict of judicial opinion among the High Courts and there is no direct decision of the highest Court on any question of law, then that would be a substantial question of law, though the decisions of the particular High Courts of which leave is sought might have been uniform on the question. That fact may be a very good ground for dismissing a second appeal if the lower Courts had followed the rulings of the High Court, but for an application for leave to appeal to the Supreme Court, I think the very fact of divergence of opinion among the High Courts is conclusive evidence of the existence of a substantial question of law.
I find more or less a similar statement of the principles in the recent decision of the Bombay High Court in Kaikhushroo Pirojsha v. C.P Syndicate Ltd. .
The only answer to the question that we can usefully give is that any question of law affecting the rights of parties would not by itself be a substantial question of law. An important or difficult question would of course be a substantial question; but even if a question is not important or difficult, if there is room for reasonable doubt or difference of opinion on the question then it would be a substantial question of law within the meaning of Art. 133 of the Constitution of India.
Panchapagesa Sastry, J,:—I agree.
Somasundaram, J.:— I agree.
(After the finding of the Full Bench, the petition came on for hearing before Subba Rao and Krishnaswami Nayudu JJ. on 6-4-1951, and the Court made the following):—
ORDER (Pronounced by Subba Rao, J.)
This application is posted before us after the Full Bench answered the question referred to it. The Full Bench gave the following answer;
“The only answer to the question that we can usefully give is that any question of law affecting the rights of parties would not by itself be a substantial question of law. An important or difficult question would of course be a substantial question; but even if a question is not important or difficult, if there is room for reasonable doubt or difference of opinion on the question, then it would be a substantial question of law within the meaning of Art. 133 of the Constitution of India”.
The main question we decided in the appeal was whether under the trust deed executed by the mortgagors the suit properties had been transferred to the trustees. We accepted the following principles as a guide in construing the trust deed:
“Though to create a valid trust there should be a transfer of interest by the author of the trust, it is manifest that no particular form of words is necessary. What is essential is a conveyance of interest and not the particular form of words in which the said transfer was couched”.
This principle has been laid down by the Privy Council in Hanutnan Prasad Pandey v. Mst. Munraj Kunwaree . After going through the entire document we held that the words used therein were of sufficient amplitude to convey the properties to the trustees. The circumstances mentioned by us in our judgment, according to us, clearly indicated that there was a transfer. We did not feel any reasonable doubt on the question that arose for consideration. The fact that we dealt with the question at some length does not show that the question argued before us was either important or difficult, or was one in regard to which we felt a reasonable doubt. Indeed, we dealt with the question at some length in order to meet the arguments advanced before us.
It is then argued by Mr. Narasaraju that another substantial question of law arises in the case, namely, whether the decree in O.S No. 4. of 1940 on the file of the Sub Court, Rajahmendrawaram, would operate as res judicata. It is true that in formulating the points argued before us, we stated that as one of the questions that arose for consideration; but in the course of the judgment we did not consider it, as presumably, it was not seriously pressed before us. The facts which we stated before we formulated the points also indicate that there are absolutely no merits in that point either. In a suit for partition between the mortgagors the plaintiff who was already on record as the 19th defendant in his capacity as a lessee applied to be made party as a mortgagee. That petition was dismissed by the Court, though with an observation that he was already on record. But in the judgment it was expressly stated that the validity of the assignment in favour of the plaintiff was left open. In the circumstances no question of res judicata arises.
In the result the application is dismissed with costs.
N.R.R