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  • Article 133(1) of the Constitution, In Section 109, Clause (a), C. P. C.,
  • Section 205(1), Government of India Act, 1935.
  • Clause (a) of Section 109 C. P. C.
  • Section 109 Clause (a) C. P. C.
  • Article 158, Limitation Act,
  • SECTION 5 LIMITATION ACT
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Citation Codes
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citation codes
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  • Article 133(1) of the Constitution, In Section 109, Clause (a), C. P. C.,
  • Section 205(1), Government of India Act, 1935.
  • Clause (a) of Section 109 C. P. C.
  • Section 109 Clause (a) C. P. C.
  • Article 158, Limitation Act,
  • SECTION 5 LIMITATION ACT
Smart Summary

Factual and Procedural Background

This is an application by the petitioner for leave to appeal to the Supreme Court of India against a judgment and order of this Court (in the matter styled Chandan Mull & Co. v. Mohanlal M. Mehta, O.S.A. No. 122 of 1951) which dismissed the petitioner's earlier appeal.

The matter arose from proceedings under the Arbitration Act. On 2 November 1950 an ex parte arbitral award was made for Rs. 21,052-12-8 with interest and costs in favour of the third respondent and against the petitioner. The award was filed into this Court in O.P. No. 66 of 1951 seeking to make the award a rule (decree) of court. Notice of filing the award was served on the petitioner on 27 March 1951.

Under Article 158 of the Limitation Act the petitioner had thirty days from service of the notice of filing to apply to set aside the award. The petitioner did not file a substantive application to set aside the award within that period. Instead he filed Application No. 2355 of 1951 purporting to be under Section 5 of the Limitation Act seeking to excuse the delay in filing any application to set aside the award.

That Section 5 application was dismissed by Krishnaswami Nayudu J. on the ground that Section 5 did not apply to proceedings in Court under the Arbitration Act. The petitioner appealed under Clause 15 of the Letters Patent; this Court dismissed that appeal, agreeing that Section 5 has no application to such proceedings. The petitioner sought leave to appeal to the Supreme Court against that decision.

Legal Issues Presented

  1. Whether an order refusing to excuse delay under Section 5 of the Limitation Act (in the context of proceedings in Court under the Arbitration Act) is a "judgment, decree or final order in a civil proceeding" within the meaning of Article 133(1)(c) of the Constitution such as to permit leave to appeal to the Supreme Court.
  2. Whether Section 5 of the Limitation Act applies to proceedings in Court under the Arbitration Act (this was the basis on which the Section 5 application was dismissed by the High Court and this Court).

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Chandan Mull & Co. v. Mohanlal M. Mehta (O.S.A. No. 122 of 1951) Identification of the judgment and order being challenged in the present application for leave to appeal. The judgment is the impugned order of this Court which the petitioner seeks to take to the Supreme Court by leave; it provides the procedural posture of the present application.
Mohammed Amin Bros v. Dominion of India, AIR 1950 FC 77 Discussion of the meaning of "judgment" and its relation to "decree"; guidance on whether an order qualifies as judgment/decree for appealability. The Court relied on the Federal Court's observations to conclude it is difficult to maintain that the instant order is a judgment or decree and to emphasize that only a final judgment falls within Article 133(1).
Kuppuswami Rao v. The King, AIR 1949 FC 1 Test for "final order": an order that finally disposes of the rights of the parties and brings the case to an end is a final order; interlocutory or preliminary orders are not. The Court adopted this test as authoritative for determining whether the present order is a final order within the relevant constitutional provision.
Ramchand Manjimal v. Govardhandas Vishindas Ratanchand, AIR 1920 PC 86 Authorities on finality from the Judicial Committee; used as part of the body of decisions defining finality. Referenced (through Kuppuswami Rao) as part of the precedent base establishing the test of finality; used to support the proposition that finality must be in relation to the suit.
Abdul Rahman v. D. K. Cassim and sons, AIR 1933 PC 58 Statement (Sir George Lowndes) that finality must be finality in relation to the suit; if suit remains alive, no appeal lies. Quoted in the Federal Court decision and relied upon by this Court to stress that an order which leaves the suit alive cannot be a final order.
Promotho v. W. A. Lee, AIR 1921 Cal 415 Where an appeal was filed out of time and a Section 5 application to excuse delay was dismissed and consequently the appeal itself was dismissed, the High Court's order dismissing the Section 5 application (followed by dismissal of appeal) was held appealable under Section 109(a) CPC. The Court observed that if, in the present case, the dismissal of the Section 5 application had resulted in dismissal of the substantive application to set aside the award, it would have followed this authority and allowed appeal to the Supreme Court. But that factual situation did not obtain here.
Purnendu Nath Tagore v. Kanailal Ghoshal, ILR (1948) 2-Cal 202 Held that an order dismissing an application under Section 5 was neither a decree nor a final order under Section 109(a) CPC; distinguished Promotho because in that case the appeal itself was dismissed. The Court cited this case and noted the distinction; however it also observed that the reasoning in such decisions depends on Section 109(a) CPC language, which differs from Article 133(1) of the Constitution.
Karsondas Dharmsey v. Gangabai, 32 Bom 108 Held that an order of the High Court refusing to admit an appeal after limitation had expired was not a decree for purposes of leave to appeal to the Privy Council. Relied upon in the Calcutta decisions discussed; this Court noted it as part of authorities holding such refusal not a decree, but also observed limited assistance due to different statutory language in the Constitution.

Court's Reasoning and Analysis

The Court proceeded in two principal strands of analysis: (A) whether the case was fit for certification for appeal to the Supreme Court under Article 133(1)(c), and (B) whether the particular order refusing to excuse delay under Section 5 of the Limitation Act was a "judgment, decree or final order in a civil proceeding" within the meaning of Article 133(1)(c).

A. Certification under Article 133(1)(c)

The Court expressly certified that the question of law involved was of general importance and that the case was fit for appeal to the Supreme Court under Article 133(1)(c). The Court therefore recognized the public or general importance of the legal issue.

B. Whether the order is a "judgment, decree or final order"

  1. The Court observed there is no direct decision answering whether an order like the present one qualifies as a "judgment, decree or final order" under Article 133(1)(c), and the authorities relied upon (Privy Council, Federal Court, High Courts) require careful application.
  2. The Court adopted the Federal Court and Privy Council test for finality: an order is "final" only if it finally disposes of the rights of the parties and brings the case to an end; interlocutory or preliminary orders do not qualify. This test was drawn from Kuppuswami Rao v. The King and related authorities (including judicial committee rulings such as Abdul Rahman).
  3. Applying that test, the Court examined the present procedural posture. O.P. No. 66 of 1951 is the petition to make the award a decree. The petitioner had filed only an application under Section 5 (to excuse delay) and had not filed a substantive application to set aside the award within the limitation period or in any event before the Section 5 application was considered.
  4. The Court recognized two competing ways of looking at the effect of dismissing the Section 5 application:
    • On the one hand, because the petition to make the award a decree remains capable of being proceeded with, the principal petition is still "alive" and therefore the order dismissing the Section 5 application may appear interlocutory.
    • On the other hand, the dismissal of the Section 5 application has the practical consequence that the petitioner can no longer take any proceeding to have the award set aside — a right which is thereby lost — which might suggest finality in relation to that particular right.
  5. The Court then addressed an important factual-procedural distinction: the petitioner had never filed a substantive application to set aside the award. Strictly, an application under Section 5 should have been filed together with the substantive application; because that was not done, the dismissal of the Section 5 application cannot be treated as if the substantive application had been dismissed. For that reason, the Court concluded the dismissal of the Section 5 application did not amount to a final adjudication of the substantive right to have the award set aside.
  6. The Court examined comparative authorities: Promotho v. W. A. Lee (where the Section 5 refusal led to dismissal of the appeal and was held appealable) and Purnendu Nath Tagore v. Kanailal Ghoshal (where an order refusing Section 5 relief was held not to be a decree or final order under Section 109(a) CPC). The Court noted that those decisions provide guidance but are distinguishable or of limited assistance because Section 109(a) CPC contains language ("passed on appeal") not found in Article 133.
  7. Ultimately, balancing principles and facts, the Court concluded that an order refusing to excuse delay under Section 5 of the Limitation Act is generally a procedural order; although it may have far-reaching consequences, by itself it does not decide the rights of the parties. Only if the refusal results in the substantive application being dismissed or otherwise finally put an end to would it be regarded as a final order.

Holding and Implications

Core Ruling: The application for leave to appeal to the Supreme Court is DISMISSED.

Implications and direct effects:

  • The Court certified that the legal question is of general importance and fit for appeal under Article 133(1)(c), but despite that certification the specific leave application was dismissed because the impugned order was not, in the Court's view on the facts, a "judgment, decree or final order" within the meaning of Article 133(1)(c).
  • As a practical consequence of the prior orders, the petitioner cannot take any further proceeding to have the arbitral award set aside because he failed to file a substantive application within the limitation period and did not properly join the Section 5 application with a substantive application; the right to apply to set aside the award was thereby lost.
  • The principal petition (O.P. No. 66 of 1951) seeking to make the award a decree remains capable of being proceeded with and can result in a decree in terms of the award.
  • The Court emphasized its general rule: an order refusing to excuse delay under Section 5 is ordinarily procedural and not a final order unless it results in final disposal of the substantive application; this is the legal principle applied to the facts of the present case.
  • No order as to costs was made by the Court.

Note: This summary reproduces only the findings and reasoning contained expressly in the provided opinion. No additional facts or inferences beyond the opinion's text have been introduced.

    H. Chandanmull And Co. By Proprietor, C. Laxmichand Mehta v. Mohanlal M. Mehta And Others.

    JUDGMENT Rajamannar, C.J.

    1. This is an application for leave to appeal to the Supreme Court of India against the Judgment and order passed by us in -- 'Chandan Mull & Co. v. Mohanlal M. Mehta', (A): O. S. A. No. 122 of 1951 dismissing it. This appeal arose out of proceedings under the Arbitration Act. On 2-11-1950 an 'ex parte' award was passed for a sum of Rs. 21052-12-8 with interest and costs in favour of the third respondent herein and against the petitioner. The award was filed into this court in O. P. No. 66 of 1951 which prayed for making the award a rule of court. Notice of filing the award was served on the petitioner on 27-3-1951. Under Article 158, Limitation Act, the petitioner had a period of thirty days from the date of service of notice of filing the award to file an application to set aside the award. The petitioner did not file any such application within time but filed an application. No. 2355 of 1951, purporting to be under Section 5, Limitation Act, for excusing the delay in filing the application to set aside the award. That application was dismissed by Krishnaswami Nayudu J. on the ground that Section 5, Limitation Act did not apply. There was an appeal under Clause 15 of the Letters Patent and we dismissed the appeal agreeing with the learned Judge that Section 5, Limitation Act, has no application to proceedings in Court under the Arbitration Act. It is against this decision of ours that the petitioner seeks leave to appeal to the Supreme Court.

    2. At the very outset we may mention that the question of law involved in this appeal, in our opinion, is of such general importance that we have no hesitation in certifying that the case is a fit one for appeal to the Supreme Court under Article 133(1)(c) of the Constitution.

    3. The only question on which we have felt considerable difficulty is whether our order can be said to be a judgment, decree or final order in a civil proceeding within the meaning of Article 133(1)(c) of the Constitution. There is no direct decision on the point to help us to decide this question. Our attention has been drawn to several decisions of the Privy Council, the Federal court and of several High Courts in India but we have felt not a little difficulty in applying the test laid down by the Privy Council and by the Federal Court to the facts of the present case.

    4. In view of the observations in the decision of the Federal Court in -- 'Mohammed Amin Bros v. Dominion of India', AIR 1950 FC 77 (B), it is difficult to maintain the position that the order now under appeal is a judgment or decree. Mukherjea J. pointed out in that decision that in English Courts the word "judgment" is used in the same sense as a "decree" in the Civil Procedure Code and it means the declaration or final determination of the rights of the parties in the matter brought before the court. It is clear that calling our order "a judgment" would not really be of much assistance in deciding the question which falls for decision because it would nevertheless remain to be considered whether the judgment is an "interlocutory judgment" or "a final judgment". It is only a final judgment that will fall within the category of judgment referred to in Article 133(1) of the Constitution.

    5. The scope of the expression "final order" was fully discussed by the Federal Court in the ruling reported in -- 'Kuppuswami Rao v. The King', AIR 1949 FC 1 (C). Though that case arose out of criminal proceedings, their Lordships were called upon to construe the expression "final order" in Section 205(1), Government of India Act, 1935. The test laid down in that decision that it is only an order which finally disposes of the rights of the parties and determines the points in dispute and brings the case to an end that can be called a "final order". A preliminary or interlocutory order would not therefore be a "final order". Kania C. J. referred to several English authorities and two rulings of the Judicial Committee in -- 'Ramchand Manjimal v. Govardhandas Vishindas Ratanchand', AIR 1920 PC 86 (D) and --'Abdul Rahman v. D. K. Cassim and sons', AIR 1933 PC 58 (E), and arrived at the test mentioned above. The same test was applied in 'AIR 1950 FC 77(B)'. Mukherjea J. in delivering the judgment of the Court said:

    "The expression 'final order' has been used in contradistinction to what is known as 'interlocutory order' and the essential test to distinguish the one from the other has been discussed and formulated in several cases decided by the Judicial Committee. All the relevant authorities bearing on the question have been reviewed by this court in their recent pronouncement in ' AIR 1949 FC 1 (C)', and the law on point, so far as this court is concerned, seems to be well settled. In full agreement with the decisions of the Judicial Committee and the authorities of the English courts upon which these pronouncements were based, it has been held by this, court that the test for determining the finality of an order is, whether the judgment or order finally disposed of the rights of the parties. To quote the language of Sir George Lowndes in ' AIR 1933 PC 58 (E): 'the finality must be a finality in relation to the suit. If after the order the suit is still a live suit in which the rights of the parties have still to be determined, no appeal lies against it.' The fact that the order decides an important and even a vital issue is by itself not material. If the decision on an issue puts an end to the suit, the order will undoubtedly be a final one, but if the suit is still left alive and has got to be tried in the ordinary way, no finality could attach to the order."

    It was not difficult to apply the test so laid down to the two cases which arose before the Federal Court, in both the cases the order sought to be appealed against left the proceeding alive which could continue to a final termination in spite of the order.

    6. In the present case the position is this: O. P. No. 66 of 1951 is the petition in which an award is sought to be made a decree of court. It is in this petition that the application was filed by the petitioner under Section 5, Limitation Act. Now that the application has been dismissed, there is nothing to prevent the petition from being proceeded with and resulting in the passing of the decree in terms of the award. In this sense it might be said that the dismissal of the petitioner's application has left the original petition alive.

    7. But it must not be overlooked that after the dismissal of the petitioner's application, he cannot take any proceeding to have the award set aside. That right he has undoubtedly lost as a result of the order of Krishnaswami Nayudu J. and our order confirming it. Though the original petition is alive, the petitioner cannot raise any objection to the award itself as such. In this sense the petitioner's right in this behalf has been finally negatived. This appears to be a plausible way of looking at the case of the petitioner. In this view the order dismissing his application would be tantamount to the dismissal of a substantive application by him to set aside the award. Unfortunately, however, it turns out that the petitioner never filed into court an application to set aside the award. He thought that he could file such an application after this court had excused the delay. Strictly speaking an application under Section 5, Limitation Act, should have been filed along with the substantive application; but that was not done. We cannot, therefore, say that the result of the dismissal of the application under Section 5, Limitation Act, is virtually a dismissal of the application to set aside the award. It might then have been more easy for us to hold that the particular proceeding has come to an end by reason of our order, viz, the proceeding to set aside the award, and in that sense our order must be deemed to be a final order.

    8. In -- 'Promotho v. W. A. Lee', AIR 1921 Cal 415 (F), what happened was this: An appeal was filed out of time. There was an application under Section 5, Limitation Act, to excuse the delay in filing the appeal. That application was dismissed and as a result the appeal itself was dismissed. It was held that the order of the High Court dismissing the appeal after refusing the application under Section 5, Limitation Act, was appealable, under Clause (a) of Section 109 C. P. C. If in the present case an application to set aside the award had been likewise dismissed on the dismissal of an application to excuse the delay in filing it, we would have held following this authority, that the petitioner is entitled to appeal to the Supreme Court. But as we have already pointed out there was no substantive application to set aside the award.

    9. In a later case in the Calcutta High Court in -- 'Purnendu Nath Tagore v. Kanailal Ghoshal', ILR (1948) 2-Cal 202 (G), the facts were slightly different. A memorandum of appeal presented to an officer of the High court was returned as barred by limitation. Thereupon an application was filed under Section 5, Limitation Act. That application was dismissed. It was held that the order dismissing the application under Section 5, Limitation Act, was neither a decree nor a final order passed on appeal by the High Court within the meaning of Section 109 Clause (a) C. P. C. The earlier decision in -- 'AIR 1921 Cal 415 (F)', was distinguished on the ground that in that case there was an order made in the appeal itself dismissing it. The learned Judges relied upon a ruling in -- 'Karsondas Dharmsey v. Gangabai', 32 Bom 108 (H), in which it was held that an order of the High Court refusing to admit an appeal after the period of limitation had expired was not a decree against which leave to appeal to Privy Council can be granted. But it must be mentioned that these decisions are not of much assistance, because the reasoning in these decisions was based on a consideration of the language of Section 109, Clause (a), C. P. C., which is absent in Article 133(1) of the Constitution, In Section 109, Clause (a), C. P. C., which they were construing, the language was "a decree or final order passed on appeal by a High Court." Part of the reasoning was based on the meaning to be attached to the words "passed on appeal"; words which are not found in Article 133.

    10. The question is not free from doubt but on the whole we think that an order like the one in question, viz., an order refusing to excuse the delay in filing an application, cannot be treated except as a procedural order. Though it may have far reaching consequences and adversely affect the rights of parties, by itself it cannot be held to have decided the rights of parties. If as a result of the dismissal of such an application, a substantive application is dismissed, or otherwise put an end to, it may then be held that there had been a final adjudication of rights and therefore there has been a final order.

    11. We are, therefore, compelled to dismiss this application though we are otherwise convinced that the case is a fit one for appeal to the Supreme Court of India. In the circumstances we do not make any order as to costs.

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    Comments

    H. Chandanmull And Co. By Proprietor, C. Laxmichand Mehta v. Mohanlal M. Mehta And Others.
    (Feb 25, 1953)