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  • INDIAN INCOME TAX AMENDMENT ACT
  • sec. 51 of the Indian Income Tax Act
  • Madras District Municipalities Act
  • Punjab Act 12 of 1940
  • Tenancy Act of 1926
  • Tenancy Act of 1901.
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Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • INDIAN INCOME TAX AMENDMENT ACT
  • sec. 51 of the Indian Income Tax Act
  • Madras District Municipalities Act
  • Punjab Act 12 of 1940
  • Tenancy Act of 1926
  • Tenancy Act of 1901.
Smart Summary

Case Summary — Application for Certificate under Article 133

Factual and Procedural Background

This application arises from a suit for a declaration that the plaintiff Maharaja Umraosingh was entitled to succeed to the Jagir of Indergarh after the death of Maharaja Sumersingh without male issue. The suit was initially instituted by Maharaja Umrao Singh (applicant No. 1), with Maharaja Udaibhan Singh originally placed as a defendant pro forma and later transposed to plaintiff No. 2. The principal defendants were Shri Bhagwati Singh and Smt. Shekhawatji, who contended, inter alia, that the suit was not cognisable by Civil Courts. The District Judge, Kotah, accepted that plea and dismissed the suit. The plaintiffs appealed to the High Court but were unsuccessful. The present proceedings are an application to the High Court for a certificate under Article 133 of the Constitution of India to permit an appeal to the Supreme Court.

Legal Issues Presented

  1. Whether the statutory threshold under Article 133 (amount/value of subject-matter not less than Rs. 20,000) is satisfied so as to permit a certificate for appeal to the Supreme Court.
  2. Whether the appeal involves a substantial question of law—specifically, whether a suit relating to succession to a Jagir within territories of the erstwhile Kotah State is cognisable by Civil Courts and whether Article 7(3) of the Covenant of the United States of Rajasthan must be interpreted for that purpose.
  3. Whether Article 133 applies in the present case given that the suit was instituted before the Constitution came into force (and when the Rajasthan High Court Ordinance, 1949, arguably provided that no appeal lay from the High Court), i.e., whether the right to appeal can be conferred retrospectively or during pendency of proceedings.

Arguments of the Parties

Applicants' Position

  • The applicants seek a certificate under Article 133 to file an appeal to the Supreme Court from the High Court's final order dismissing their suit for declaration of succession to the Jagir of Indergarh.
  • The suit was valued at Rs. 50,000 (alleged annual income of the property in dispute), which, if accepted, meets the Article 133 monetary threshold.

Opposite Party's Arguments (as recorded)

  • That the appeal does not involve any substantial question of law.
  • That the decree of the High Court is not open to appeal under Article 133 because the suit was instituted on 2nd August 1949 (before the Constitution came into force) and, under the Rajasthan High Court Ordinance of 1949 in force when the action was brought, no appeal lay from a Division Bench of the High Court; hence the decree is final and Article 133 is not retrospectively applicable.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Examiner of Local Fund Accounts, Madras v. C. Subramania Mudaliar, AIR 1943 Mad. 208 Held that where certain applications were filed when no right of appeal existed but later rules were amended to provide an appeal, the subsequent amendment could not apply to the earlier cases; therefore no appeal would lie. The Court acknowledges this Division Bench ruling as a direct authority relied upon by the opposite party but notes that some Madras rulings are not persuasive on logical distinction; the Court prefers to follow other rulings cited on behalf of the applicant.
Thota Surayoa v. Inspector Municipal Councils and Local Board, Madras, AIR 1944 Mad. 148 Held that where at the time of the application there was no provision for appeal, and although the Act was later amended to provide for appeal, an appeal did not lie. The Court treats this as another Madras ruling relied upon by the opposite party but indicates that these Madras decisions lack detailed reasoning and that the Court prefers other authorities.
In re Athlumney Ex parte Wilson, 1898-2 QB 547 Considered whether an enactment (affecting interest calculation) applied retrospectively to a scheme adopted before the Act passed; held the section was not retrospective and did not apply to debts proved under a scheme before the Act. The Court notes this authority but observes that it did not directly confront the question whether a right of appeal conferred after proceedings began could apply to orders made after the right was conferred; therefore it is distinguishable from the present issue.
Delhi Cloth & General Mills Co. Ltd. v. Income Tax Commissioner, Delhi, AIR 1927 PC 242 Held that an amendment creating a right of appeal did not apply to orders that were final at the date the amendment came into force; orders dated before amendment remained final. The Court distinguishes this case from the present matter because in the present case the decree appealed from and the appeal in which the decree was made were both filed after the Constitution came into force.
Shamsingh v. Vir Bhan, 1942 Lahore 102 Held that rights acquired by attachment and sale before a legislative amendment (which later made property unattachable) could not be defeated by the subsequent Act; the purchaser's acquired rights survived. The Court notes this ruling but states it is not on point with respect to the specific question whether an order made appealable by an Act passed before the order but after proceedings began is open to appeal.
Colonial Sugar Refining Co. Ltd. v. Irving, 1903 ACP 369 Held that a right of appeal existing when an action began could not be defeated by a later statute which abolished or transferred the appeal; right of appeal regarded as not purely procedural and not to be taken away pending an action unless clear intention. The Court cites this authority for the general principle that statutory changes affecting appeals should not be held retrospective unless clearly intended, but notes the case does not address the precise temporal configuration now before the Court (i.e., right of appeal conferred during pendency before a particular order is made).
Devi Prasad v. M. Phundanlal, AIR 1942 Oudh 291 Full Bench held that where a first appeal was filed before an amendment that provided a further appeal, and the order in appeal was passed after the amendment came into force, a second appeal did lie; majority distinguished between taking away rights and adding rights. The Court adopts and follows the majority reasoning of this Full Bench case, emphasizing the distinction between abolishing a right of appeal and adding a right; uses it to support that an order given after a right of appeal is conferred can be appealed even if proceedings began earlier.
Govindram Seksaria … Assessees v. Commissioner of Income-Tax (Central) Bombay, AIR 1943 Bom. 122 The observations of Beaumont, C.J. suggest that an order made after an amendment which made such orders appealable should be considered appealable; it is difficult to see why such an order would not be appealable. The Court cites these observations in support of the view that orders made after an enactment conferring appealability should be appealable; the observations confirm the approach that procedural changes creating appeals may apply to subsequently made orders in pending proceedings.
B. Suraj Singh v. Harakh Chand, AIR 1928 All. 143 Held that where an order rejecting an application to set aside an ex parte decree was passed after the Tenancy Act of 1926 (which provided an appeal) came into force, the right of appeal must be governed by the later Act. The Court cites this case as authority supporting the proposition that where an order is passed after a statute comes into force providing an appeal, the forum and right of appeal are governed by that statute even if the suit began earlier.

Court's Reasoning and Analysis

The High Court proceeded in stages.

  1. Monetary threshold (Article 133 sub-Art. (1)(a)/(b)). The suit was valued at Rs. 50,000 as alleged annual income of the property in dispute; the defendants alternatively pleaded much higher values. The Court concluded that the Article 133 monetary condition (not less than Rs. 20,000) was unquestionably fulfilled.
  2. Substantial question of law (Article 133 sub-Art. (1)(c) and adjuncts). The Court overruled the opposite party's first objection, finding that the appeal did involve an important question of jurisdiction—namely, whether succession to the Jagir in the territories of the erstwhile Kotah State was cognisable by Civil Courts and whether Article 7(3) of the Covenant of the United States of Rajasthan required interpretation. On that basis the High Court treated the point as a substantial question of law.
  3. Temporal / retrospectivity objection. The second objection—that Article 133 could not apply because the suit was instituted before the Constitution took effect and at that time the Rajasthan High Court Ordinance precluded appeals from the High Court—was recognized as complex. The Court examined numerous authorities and contrasted two distinct situations:
    • Cases where a right of appeal existing at the institution of proceedings was taken away by subsequent legislation (where courts are generally cautious to apply such change to pending actions); and
    • Cases where legislation, enacted after institution but before a particular order, creates or adds a right of appeal (where courts have, in several authorities, permitted the subsequent right to operate in respect of orders given after the amendment).
    The Court reviewed and distinguished authorities relied upon by the opposite party (notably two Madras decisions) and found them less persuasive because of limited reasoning. The Court aligned with Full Bench reasoning in Devi Prasad v. M. Phundanlal and with observations in Govindram Seksaria, emphasizing the established distinction: removing an existing substantive right is different from granting an additional procedural right during pendency. The High Court concluded that where an appeal is provided before a particular order is given (even though proceedings began earlier), that subsequent right can govern the order made after the provision came into force.
  4. Applying these principles to the facts, the Court concluded that the objection based on timing and the Rajasthan High Court Ordinance did not preclude granting a certificate: the decree (and the appeal against it) were to be treated in light of the law in force when the decree/appeal were made, and the case presented a substantial question of law amenable to Supreme Court review.

Holding and Implications

CERTIFIED AS A FIT CASE FOR APPEAL TO THE SUPREME COURT UNDER ARTICLE 133 OF THE CONSTITUTION

Direct effect on the parties: The High Court allowed the application for a certificate under Article 133 and certified that the case is fit for an appeal to the Supreme Court; accordingly, the plaintiffs are permitted to file an appeal to the Supreme Court from the High Court's judgment.

Broader implications: In reaching this conclusion the High Court applied and discussed existing authorities concerning the temporal operation of statutes affecting appeal rights. The Court emphasized the distinction between statutes that abolish an existing substantive right of appeal and statutes that create or add a right of appeal during pendency; the Court adopted the position that where a right of appeal is conferred before a particular order is made, that order may be governed by the newly conferred right even though the proceedings began earlier. The opinion applies established precedents and reasoning; it does not purport to announce a novel rule beyond the application and synthesis of the cited authorities.

Disposition recorded: Application allowed; Ranawat, J. concurred.

    Umrao Singh v. Bhagwati Singh

    Sharma, J.:— This is an application for a certificate under Art. 133 of the Constitution of India for filing an appeal to the Supreme Court and arises out of a suit for a declaration that the plaintiff Maharaja Umraosingh was entitled to succeed to the Jagir of Indergarh, the last holder of which, Maharaja Sumersingh had died without leaving any male issue. The suit was in the first instance brought by Maharaja Umrao Singh applicant No. 1 and Maharaja Udaibhan Singh, applicant No. 2 was made a defendant pro forma. Later on, Maharaja Udaibhan Singh was transposed as plaintiff No. 2. The suit was contested by Shri Bhagwati Singh and Smt. Shekhawatji, opposite parties, who were the principal defendants, on the ground inter alia that the suit was not congnisable Civil Courts. The learned District Judge, Kotah, gave effect to this plea and dismissed the suit. The plaintiffs appealed to this Court, but were unsuccessful. Now they pray for a certificate under Art. 133 of the Constitution for filing appeal to Supreme Court.

    2. Sub-Art. 1 of Art. 133 which is relevant to this case runs as follows:—

    (1) An appeal shall lie to the Supreme Court from any judgment decree or final order in a Civil proceedings of a High Court in the territory of India, if the High Court certifies:—

    “(a) That the amount or value of the subject-matter of the dispute in the court of first instance and still in dispute on appeal was and is not less than twenty thousand rupees or such other sum as may be specified in that behalf by Parliament by law; or

    (b) that the judgment decree or final order involves directly or indirectly some claim or question respecting property of the like amount or value; or

    (c) that the case is a fit one for appeal to the Supreme Court”

    and where the judgment, decree or final order appealed from affirms the decision of the court immediately below in any case other than a case referred to in sub-clause (c), if the High Court further certifies that the appeal involves some substantial question of law.”

    3. The suit was valued at Rs. 50,000/- which was alleged to be the annual income of the property in dispute. The defendants alleged in their written statement that the annual income was Rs. 1,50,000/- or 2,00,000/- and the value of the property in dispute was Rs. 25,00,000/- or 30,00,00/. Thus one of the conditions laid down in the Article that the amount or value of the subject-matter of the dispute in the court of first instance and still in dispute not be less than Rs. 20,000/- is unquestionably fulfilled.

    4. The learned counsel for the opposite party, however objects to the grant of certificate on the following two grounds:—

    (1) That the appeal does not involve substantial question of law.

    (2) That the decree of this Court is not open to appeal under Art. 133 as the suit was brought before the Constitution came into force and, therefore, Art. 133 which is not retrospective in its effect does not apply and as the Rajasthan High Court Ordinance of 1949 which was in force when the action was brought provided no appeal against the judgment or decree of Rajasthan High Court, the decree of this Court became final.

    5. So far as the first objection is conceaned, I have no difficulty in overruling it. The appeal involves an important question of jurisdiction, i.e, whether a suit relating to the succession to a Jagir within the territories of erstwhile Kotah State is cognisable by Civil Courts and for that Art. 7(3) of the Covenant of the United States of Rajasthan has to be interpreted. There can, therefore, be no question that the appeal involves a substantial question of law.

    6. The second question is, no doubt, much more complicated and not easy to decide. The Learned counsel for the opposite party has argued that although the decree in question was passed after the Constitution had come into force, yet the suit was filed on the 2nd August, 1949, i.e, before the Constitution came into force. At that time, no appeal was provided against a judgment or decree of a Division Bench of the High Court of Rajasthan. Sec. 40 of Rajasthan High Court Ordinance lays down that until a Court is constituted in pursuance of sec. 39 of this Ordinance, or of any other law relating to the establishment of a Court superior to the High Court to hear, appeals therefrom, the High Court shall be the highest Court of appeal, reference and revision in the State and shall have jurisdiction to entertain and dispose of such appeals, revisions, references, cases and other proceedings as it is empowered to entertain and dispose of under this Ordinance or any enactment or law in force in the State and no appeal shall lie from any judgment, decree or order of the High Court. The decree of this Court, therefore, which was passed, by a Division Bench became final and was not open to appeal to Supreme Court. Reliance has been placed by the learned counsel upon a number of rulings, but only the rulings reported in Examiner of Local Fund Accounts, Madras v. C. Subramania Mudaliar AIR 1943 Mad., 208 and Thota Surayoa v. Inspector Municipal Councils and Local Board, Madras AIR 1944 Mad., 148, have Page: 639a direct hearing upon the point. In the former case, certain, applications were filed under the Madras District Municipalities Act when no right of appeal existed but later on an amendment was made in the rules framed under the said Act which provided an appeal in such eases. It was held by a Division Bench that no appeal would lie against the orders of such applications as the subsequent amendment of the rules could not apply to the case in question. In the later case the president and certain members of a Panchayat Board filed an application in the District Court against an order of sub-charge made against them by the Examiner of Local Funds Account and at that time, there was on provision in the Local Board Act for an appeal against the order of the District Judge. The Act was amended subsequently, providing for appeal and the order was passed thereafter. The president and other members who were unsuccessful in the application filed an appeal to the High Court. It was held that an appeal did not lie even though at the time, the order was passed, there was provision for an appeal. Other rulings cited by the learned counsel for the opposite party have no direct bearing upon the point before us. In the In re Athlumney Exparte Wilson 1898-2 QB 547 a creditor proved for a debt. which carried interest at a rate exceeding 5 per cent. Afterwards on August 18 of the same year, the Bankruptcy Act 1890 was passed with a section postponing its operation until January, 1891. Sec. 43 of the said Act enacted as follows:—

    “Where a debt. has been proved upon a debtor's under the Principal Act and such debt. includes or any pecuniary consideration in lieu of interest, such interest or consideration shall, for the purpose of dividend be calculated at a rate not exceeding 5 per cent. per annum, without prejudice to the right of creditor to receive out of the estate any higher rate of interest to which he may be entitled after all the debts proved in the estate have been paid in full.”

    7. The question was whether the said enactment operated so as to govern the distribution of dividend under a contract made under a scheme which had taken effect before the Act was passed or came into operation. It was held that the section was not retrospective in its operation and, therefore, did not apply to a debt. including interest above 5 percent, proved under a scheme adopted by the court before the date of passing of the Act. It is clear that there was no question as to whether there being no appeal at the time when the proceedings began an order passed in those proceedings, after the right of appeal was conferred, could be appealed against. In Delhi Cloth & General Mills Co. Ltd. v. Income Tax Commissioner, Delhi AIR 1927 PC 242, it was contended on behalf of the Income Tax Commissioner that no appeal lay to His Majesty in Council from orders of a High Court in India made upon reference either under sec. 51 of the Indian Income Tax Act 1918 or under sec. 66 of the Act of 1922, and that the provision for appeal made by the Indian Income Tax (Amendment) Act 1926 could not apply to the case in question because the proceedings for assessment started before the 1st April, 1926, when the Amendment Act came into force. The orders appealed against were orders dated 6th January, 1926. Their Lordships, therefore, held that the section did not apply to orders because they were final at the date when it came into force, and it was not clearly provided that appeal shall lie against such orders. The case is distinguishable from the present case in as much as not only the decree against which an appeal is intended to the Supreme Court but even the appeal itself in which the decree has been made was filed after the Constitution came into force. In Shamsingh v. Vir Bhan 1942 Lahore 102, a residential house of a non-agriculturist was attached before sec. 60 of the Code of Civil Procedure was amendment by Punjab Act 12 of 1940 and the residential house of non-agriculturist was made unattachable. Even the sale was Page: 640made before the said amendment and the question that was raised by the judgment-debtor was that because the sale had not been confirmed, the amendment applied for the case and the attachment and sale could not be maintained. It was held that by the attachment and sale of the property the auction purchaser had got certain rights, which could not be defeated by an Act subsequently passed. This ruling too, has no concern with the question whether an order made appealable by an Act which came into force before that order was passed was open to appeal in view of the fact that no appeal was provided when the proceedings in which that order was passed, commenced. In the Colonial Sugar Refining Company Ltd. v. Irving 1903 ACP, 369 it was held that the right of an appeal which existed at the time the action began could not be defeated by a subsequent law which took away such right of appeal. It was held that the right of appeal is not a mere procedural right. To deprive a suitor in a pending action of an appeal to a superior tribunal which belonged to him as of right is a very different thing from regulating the procedure. It could not, therefore, be taken away, pending the action. As by the Act in question, the right of appeal was transferred from the King in Council to the High Court of Australia it was held that in principle, their Lordships saw no difference between abolishing an appeal altogether and transferring the appeal to a new tribunal. In either case there is an interference with existing rights contrary to the well-known general principle that statutes are not to be held to act retrospectively unless a clear intention to that effect is menifested. Their Lordships, therefore, held that the appeal still lay to the King in Council, notwithstanding the fact that fending action, the right of appeal was transferred from the King in Council to the High Court of Australia. In that case too, their Lordships had not to deal with a case, in which right of appeal was conferred before the order against which appeal was sought but after the proceedings in which that order was passed. The question whether an appeal lay against an order made appeable by an Act passed before the said order, but after the proceeding giving rise to that order, directly arose before a full bench of Oudh Chief Court in the case of Devi Prasad v. M. Phundanlal AIR 1942 Oudh, 291. Under the U.P Encumbared Estate Act 25 of 1934, only one appeal was provided against the order of a Special Judge, second grade, under sec. 4 of the Act. A first appeal was filed against such an order before the 13th of September, 1939, on which date, by an amending act, a second appeal to the High Court was provided in certain circumstances. The order in appeal was passed after the 30th September, 1939. It was held by the majority that such an appeal lay. The learned Judges observed that a distinction should be drawn between the case where the right of appeal is taken away and the case where another right of appeal is added. The interference with the rights of the parties is clearly of a different nature in the two cases. The right of appeal is a positive right and it accrues at the time of the filing of a suit, but the absence of the right of appeal cannot be called a right at all. The prohibition of appeal by the law, at the time of the institution of the suit does not amount to a substantive or existing right accruing to the parties. It is a mere negation of such right. If the law, therefore chooses to give such a right during the pendency of the case, there is no principle of law which prevents it from doing so. Therefore, a second appeal against the decree of the first appellate court lies linger sec. 45(2)(a) of the Act as amended by Act 11 of 1939 which came into force on the 30th September, 1939. Where the first appeal to the lower appellate court was filed before but decided after 30th September, 1939, two of the five judges, Thomas, C.J and Gulam Hussain, J. dissented. With respect to the dissented Judges, the reasoning given by the Page: 641majority appeals to me. It is well known cannon of law that Acts dealing with the procedure are generally retrospective in their effect. Right of appeal has, however, been held to be a substantive right and is considered to be vested in a suit or at the time, when he begins his action. It cannot, therefore be taken away during the pendency of the action. The prohibition of appeal by law existing at the time of the institution of the suit does not, however, amount to a substantive of existing right accruing to the parties. If therefore, an appeal, is provided before a particular order is given, against which the appeal is sought, the order can be appealed against even though the proceedings in which it was passed, began before the right of appeal was conferred. I am confirmed in this opinion also by the observations of Beaumont, C.J in Govindram Seksaria…Assessees; v. Commissioner Of Income-Tax (Central) Bombay., Bombay AIR 1943 Bom. 122. In that case the assessment order in a case pending on 1st April, 1939, was made on 3rd January, 1940. Such orders were not appealable before the Income Tax Act was amended on 1st April, 1939, when for the first time, such orders became appealable. The Learned, C.J observed that the order having been made on 3rd January, 1940, it seemed to him rather difficult to see why the order was not appealable. Reliance was placed on 1905 A.C.P 369. The learned Judge observed that in that case, the Privy Council were dealing with the statute which had put an end to the appeals to the Privy Council and they held that a right appeal is a substantive right and not a mere matter of procedure and that in the absence of clear language the statute should be construed as not applying to appeals pending when the statute was passed. Further on the learned Judge observed that it is one thing to say that a man filing a suit has a vested right to take his case to the highest tribunal then permissible; it is going rather to say that if and when he obtains a decision from a court from which at the moment there is no appeal he will have a vested right to treat the order as final, although an appeal is permissible when the order is passed. In B. Suraj Singh v. Harakh Chand AIR 1928 All. 143, a Division Bench had before it a case in which an appeal was filed before a District Judge in a suit for arrears of rent exceedings Rs. 100/- but below Rs. 200/-. A decree ex parte was passed and an application for setting aside the ex parte decree was rejected after the Tenancy Act of 1926 came into force. Under the said Act, an appeal was provided in such matters to a District Judge against the orders of Assistant Collector First Class. Before that Act, however, no appeal was provided by Tenancy Act of 1901. The suit was filed before the Tenancy Act of 1926, came into force. It was held that because the order rejecting the application for setting aside the ex parte decree was passed after the corning into force of the Act of 1926, the right of appeal must be governed and the forum of the appeal must be determined with reference to the provisions of the said Act. One of the two Madras rulings which has been cited on behalf of the opposite party does not make in clear whether the orders against which appeal was given or after that. The ruling reported in 1944 Madras simply follows the ruling reported 1943 Madras p. 208 and another unreported case. No reasons are given for the opinion that there is no logical distinction between a right of appeal and a right to a final judgment without an appeal. With respect to the learned Judges of the Madras High Court, I prefer to follow the rulings cited on behalf of the applicant.

    8. I allow the application and certify the case to be a fit on for an appeal to Supreme Court under Art. 133 of the Constitution.

    Ranawat, J.:— I agree.

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    Comments

    Umrao Singh v. Bhagwati Singh
    (Aug 20, 1951)