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Ratan Lal Shah - v. Firm Lalmandas Chhadammalal And Another
Factual and Procedural Background
The plaintiffs, Firm Lalmandas Chhadammalal, sued the partnership “Mohan Singh Ratan Lal” through its two partners--Mohan Singh and Ratan Lal--for Rs. 12,883 plus interest, alleging non-payment for goods supplied. The Senior Civil Judge, Nainital, passed a joint and several decree against both partners and the firm.
Only Ratan Lal appealed to the Allahabad High Court. Mohan Singh was arrayed as the second respondent, but notice of appeal to him was returned unserved. The High Court dismissed the appeal, holding (i) that the decree against Mohan Singh had become final and hearing Ratan Lal alone might yield conflicting decrees, and (ii) that the appeal was liable to be dismissed for want of prosecution because Ratan Lal had not ensured service on Mohan Singh.
Ratan Lal obtained special leave and appealed to the Supreme Court of India, leading to the present judgment.
Legal Issues Presented
- Whether, under Order 41 Rule 4 of the Code of Civil Procedure, an appellate court can entertain an appeal by one of several judgment-debtors bound by a joint decree when the other joint debtor has neither appealed nor been served.
- Whether an appeal may be dismissed for want of prosecution solely because notice of appeal was not served on the non-appealing joint judgment-debtor.
Arguments of the Parties
Appellant — Ratan Lal Shah
- Invoked Order 41 Rule 4 CPC, contending that a single defendant may appeal from a joint decree founded on a ground common to all defendants, and the appellate court may grant relief to all similarly situated parties.
- Asserted that failure to serve Mohan Singh did not vitiate the appeal, nor justify dismissal for want of prosecution.
Respondent — Firm Lalmandas Chhadammalal
- Maintained that hearing the appeal without Mohan Singh could violate natural justice and result in conflicting decrees.
- Argued that Ratan Lal’s negligence in ensuring service on Mohan Singh warranted dismissal of the appeal.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Karam Singh Sobti & Anr. v. Shri Pratap Chand & Anr., (1964) 4 SCR 647 | An appeal by one party to a joint decree is maintainable even when the other party does not appeal; the appellate court can grant relief to all parties sharing a common interest. | Explained and followed to uphold Ratan Lal’s right to pursue the appeal notwithstanding Mohan Singh’s absence. |
Court's Reasoning and Analysis
The Supreme Court held that the High Court misapplied the law. Order 41 Rule 4 CPC expressly allows one of several defendants to appeal when the challenged decree proceeds on a ground common to all. The rule’s purpose is to avert injustice by permitting relief in favour of all similarly situated parties through a single appellant.
The Court reviewed earlier divergence among High Courts but found the issue conclusively settled in Karam Singh Sobti, which confirmed that an appeal remains competent even if the non-appealing party is not active in the proceedings. Since the trial court’s decree against Ratan Lal and Mohan Singh rested on the same factual and legal foundation (liability for goods supplied), the Supreme Court declared it “essentially a case” for applying Order 41 Rule 4.
The possibility that Mohan Singh would suffer prejudice was rejected: success for Ratan Lal could only reduce, not enlarge, Mohan Singh’s liability. Moreover, speculative risk of conflicting decrees cannot override the statutory right of appeal.
On the service issue, the Court found no basis to penalise the appellant; even assuming negligence, it could not extinguish his statutory appellate right.
Holding and Implications
APPEAL ALLOWED; High Court decree set aside; matter remanded to the Allahabad High Court for fresh disposal on merits. No costs in the Supreme Court; appellant to bear costs of the High Court appeal.
Implications: The ruling reaffirms and clarifies the scope of Order 41 Rule 4 CPC, confirming that one judgment-debtor may effectively challenge a joint decree without the active participation or service of the co-debtor, so long as the decree rests on a ground common to both. While it does not create new precedent, it strengthens existing authority and guides lower courts to avoid dismissing such appeals on technical grounds of non-service or fear of conflicting outcomes.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 4
PETITIONER:
RATAN LAL SHAH
Vs.
RESPONDENT:
FIRM LALMANDAS CHHADAMMALAL & ANR.
DATE OF JUDGMENT:
15/04/1969
BENCH:
SHAH, J.C.
BENCH:
SHAH, J.C.
MITTER, G.K.
CITATION:
1970 AIR 108 1970 SCR (1) 296
1969 SCC (2) 70
CITATOR INFO :
D 1971 SC 742 (5)
RF 1975 SC 733 (30,34)
ACT:
Civil Procedure Code, 1908 Order 41 Rule 4-Joint decree' against two persons-Appeal by only one person-Whether appeal court can exercise jurisdiction under O. 41 r. 4.
HEADNOTE:
The respondent obtained a joint decree against the appellant and his partner M. Against the decree, the appellant alone appealed to the High Court. M was impleaded as the 'second respondent in the appeal. The notice of appeal sent to M was returned unserved. The High Court dismissed the appeal on the view that since there was a joint decree against the appellant and M in a suit founded on a joint cause of action and the decree against M had become final, the appellant could not claim to be heard on his appeal; if he was heard there could be two conflicting decisions between the same parties and in the same suit based on the same cause of action. The High Court also held that the appellant had not taken steps to serve M and the appeal must be dismissed for want of prosecution.
On appeal to this Court
HELD : The judgment of the High Court could not be sustained.
The appeal could not be dismissed on the ground that M was not served with the notice of appeal, nor, in view of the provisions of Order 41 Rule 4, could the High Court dismiss the appeal on the ground that there was a possibility of two conflicting decrees. [297 G-H]
The object of the rule is to enable one of the parties to a suit to obtain relief in appeal when the decree appealed from proceeds on a ground common to him and others. The Court in such an appeal may reverse or vary the decree in favour of all the parties who are in the same interest as the appellant. [298B]
Karam Singh Sobti and Anr. v. Shri Pratap Chand and Anr. (1964) 4 S.C.R. 647, explained and followed.
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JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1019 of 1966. Appeal by special leave from the judgment and decree dated July 10, 1963 of the Allahabad High Court in First Appeal No. 16 of 1953.
C. B. Agarwala and K. P. Gupta, for the appellant. B. C. Misra, O. P. Gupta, Ram Parkash Agarwal and Sultan Singh, for respondent No. 1.
The Judgment of the Court was delivered by Shah, J. Firm Lalmandas Chhadammalal-hereinafter called 'the plaintiffs'--commenced an action against "Mohan Singh Ratan Lal, through its partners Mohan Singh and Ratan Lal", in. the
297
Court of the Senior Civil Judge, Nainital, for a decree for Rs. 12,883/- and interest thereon for value of goods supplied. Ratan Lal denied liability for payment of the amount claimed. Mohan Singh by a separate written statement admitted that goods were supplied by the plaintiffs to the firm, but submitted that he was liable only for one-fifth of the amount claimed. The Trial Judge decreed the claim of the plaintiffs in its entirety against "Mohan Singh and Ratan Lal and the firm known as Mohan Singh Ratan Lal".
Against the decree, Ratan Lal alone appealed to the High Court of Allahabad. Mohan Singh was impleaded as the second respondent in the appeal. The notice of appeal sent to Mohan Singh was returned unserved and an application made by counsel for the appellant to serve Mohan Singh "in the ordinary course as well as by registered post" was not disposed of by the Court. On July 9, 1963 Ratan Lal applied that it was "detected that there had been no service of the notice of appeal upon Mohan Singh -and it was essential for the ends of justice that notice of appeal may be served upon Mohan Singh". The Court by order dated July 10, 1963, rejected the application' and proceeded to hear the appeal. The Court was of the view that since there was a joint decree against Ratan Lal and Mohan Singh in a suit founded on a joint cause of action and the decree against Mohan Singh had become final, Ratan Lal could not claim to be heard on his appeal. The High Court observed:
"If we hear him (Ratan Lal) the result may be that on the success of his appeal there will be two conflicting decisions between the same parties in the same suit based on the same cause of action. Furthermore, the appellant has not taken steps to serve the second respondent (Mohan Singh) and the appeal must be dismissed for want of prosecution. On both these grounds we dismiss this appeal."
Against the order passed by the High Court, this appeal, has been, preferred with special leave.
In our view the judgment of the High Court cannot be sus- tained,. The appeal could not be dismissed on the ground that Mohan Singh was not served with the notice of appeal, nor could the appeal be dismissed on the ground that there was a possibility of two conflicting decrees. Order 41 r. 4 of the Code of Civil Procedure provides :
"Where there are more plaintiffs or more defendants than one in a suit, and the decree appealed from proceeds on any ground common to all the plaintiffs or to all
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the defendants, any one of the plaintiffs or of the defendants may appeal from the whole
2
decree, and thereupon the Appellate Court may reserve or vary the decree in favour of all the plaintiffs or defendants, as the case may The object of the rule is to enable one of the parties to a suit to obtain relief in appeal when the decree appealed from proceeds on a ground common to him and others. The Court in such an appeal may reserve or vary the decree in favour of all the parties who are in the same interest as the appellant. There was some conflict of judicial opinion in the High Courts' on the question whether power under 0. 41 r. 4 of the Code of Civil Procedure may be exercised where all the parties against whom a decree passed on a ground which is common to them are not impleaded in the appeal. The preponderance of authority in the High Courts was that even in the absence of a person against whom a decree has been passed on a ground common with the appellant, the appeal was maintainable, and 'appropriate relief may be granted It is, however, unnecessary to examine those decisions for, in our judgment, the question has been considered by this Court in Karam Singh Sobti and Anr. v. Shri Pratap Chand and Anr.(1). In that case a landlord of certain premises filed an action in ejectment against the tenant and the sub-tenant in respect of premises on the ground that the tenant had sub-let the premises without the land lord's consent. The Trial Judge decreed the suit holding that the landlord had not acquiesced in the sub- letting. _ The sub-tenant alone appealed to the Additional Senior Subordinate Judge who set aside the order of the Trial Court. It was urged before this Court that the appeal by the sub-tenant to the Subordinate Judge was incompetent, because the tenant against whom a decree in ejectment was passed had not appealed. On certain question which are not material for the purpose of this judgment, there was difference of opinion between Sarkar, J., on the one hand, and S. K. Das, Acting C.J., and Hidayatullah, J., on the other, but the Court unanimously held in that case that the appeal was maintainable before the Subordinate Judge, even though the tenant had not appealed against the order of the Court of First Instance Sarkar, J., observed at p. 663 :
"The suit had been filed both against the tenant and the sub-tenant, being respectively the Association and the appellant. One decree had been passed by the trial Judge against both. The appellant had his own right to appeal from that decree. That right could not be affected by the Association's decision not to file an appeal. There was one decree and, therefore, the appel-
(1) [1964] 4 S.C.R. 647.
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lant was entitled to have it set aside even though thereby the Association would also be freed from the decree. He could say that that decree was wrong and should be set -aside as it was passed on the erroneous finding that the respondent had not acquiesced, in the sub- letting by the Association to him. He could challenge that decree on any ground available. The lower appellate Court was, therefore, quite competent in the appeal by the appellant from the joint decree in ejectment against him and the Association, to give him whatever relief he was found entitled to, even though the Association had filed no appeal."
With that view S. K. Das, Acting C.J., and Hidayatullah, J.,
3
agreed : see p. 652. It is true that in that case the tenant was made a party to the appeal before the Subordinate Judge. But the judgment of the Court proceeded upon -a larger ground that the sub-tenant had a right to appeal against the decree passed against him and that right was not affected by the tenant's decision not to file an appeal. Counsel for the plaintiffs contended that the appeal filed by Ratan Lal if it be heard may possibly result in an order which may prejudicially affect Mohan Singh, and if Mohan Singh has no opportunity of being heard no decree may be passed against him, for to do so would be contrary to the fundamental rules of natural justice. But in the appeal filed by Ratan Lal there is no possibility of a decree being passed which may impose a more onerous liability upon Mohan Singh. The Trial Court has passed a decree against Ratan Lal and Mohan Singh jointly and severally. Mohan Singh is liable for the full amount of the claim of the plaintiffs. If the appeal filed by Ratan Lal succeeds, the Court may reduce the liability of Mohan Singh, but there may conceivably be no order by the Court operating to the prejudice of Mohan Singh in the appeal.
It was also urged by counsel for the plaintiffs that Ratan Lal had been negligent in the High Court in prosecuting the appeal, and it would be putting a premium upon his negligence to allow him now to prosecute the appeal. It is not possible on the record, ,as it stands, to say whether failure to serve notice of appeal upon Mohan Singh was wholly attributable to the negligence of Ratan Lal. But even if it be assumed that he was negligent, on that ground he cannot be deprived of his legal right to prosecute the appeal and to claim relief under 0. 41 r. 4 of the Code of Civil Procedure, if the circumstances of the case warrant it. The decree of the Trial Court proceeded on a ground common to Mohan Singh and Ratan Lal. In the appeal filed by Ratan Lal he was denying
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liability for the claim of the plaintiffs in its entirety. This was essentially a case in which the Court's jurisdiction under 0. 41 r. 4 Code of Civil Procedure could be exercised.
The appeal is allowed and the decree passed by the High Court is set aside. The proceedings are being remanded. The High Court will admit the appeal in its original number and hear and dispose it of according to law. There will be no order -as to costs in this Court of this appeal. In view of the fact that there has been some negligence on the part of Ratan Lal to prosecute the appeal in the High Court, we direct that he will pay the costs of the appeal in the High Court in any event.
R.K.P.S. Appeal
allowed.
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