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Syed And Company And Others v. State Of Jammu & Kashmir And Others
Factual and Procedural Background
Between March 7, 1963 and April 14, 1965 the Government of Jammu & Kashmir granted a series of timber-extraction leases to private parties. A Full Bench of the Jammu & Kashmir High Court subsequently declared those leases void in State of J&K v. Goodwill Forest Lessees, AIR 1974 J&K 1. To address the consequences of that ruling, the State amended the Jammu & Kashmir Forest Act, 1987 by inserting Sections 52-A, 52-B and 52-C, creating a “prescribed authority” empowered to ascertain the financial advantages obtained under the now-void leases.
The State sued Syed & Co. on 7 January 1976 for Rs 7,61,953.52 in unpaid royalty and interest. On 8 August 1981 the prescribed authority found that the lessee had paid Rs 25,37,384.15 but had removed timber worth only Rs 21,36,611.50; accordingly, it held Syed & Co. was entitled to Rs 3,45,762.09 and dismissed the State’s suit, while nevertheless directing that a decree be drawn.
The State appealed (Civil First Appeal 59/1981). While that appeal was pending, the High Court decided Malik Abdul Ahmad Shah Jalil Ahmad Akhtar v. State of J&K, AIR 1982 J&K 16, recognising the prescribed authority’s power to value extracted timber. Relying on that case, the State sought to adduce additional evidence under Order 41 Rule 27, C.P.C. The High Court rejected the application as time-barred and for lack of relevant pleadings, dismissed the appeal, and set aside the direction to draw a decree.
The State (C.A. 544/1985) challenged the rejection of its application, while Syed & Co. (C.A. 543/1985) contested the High Court’s deletion of the decree-drawing direction. A related matter, C.A. 1084/1986, stood or fell with these appeals.
Legal Issues Presented
- Whether the High Court erred in refusing, under Order 41 Rule 27 C.P.C., to permit the State to lead additional evidence on the market value of timber extracted by Syed & Co.
- Whether the prescribed authority under Section 52 of the Jammu & Kashmir Forest Act, 1987 is competent to order that a civil decree be drawn up.
- Whether Syed & Co. is entitled to directions from the Supreme Court enabling recovery of the amount found due to it.
Arguments of the Parties
State of Jammu & Kashmir (Appellant in C.A. 544/1985)
- Invoked Malik Abdul Ahmad Shah to argue that the prescribed authority may compute timber value at prevailing market rates; therefore, the High Court should have allowed additional evidence on that point.
- Contended that its prayer before the prescribed authority for a decree based on timber value constituted sufficient pleading; evidence should not have been excluded.
- Asserted that limitation could not bar the amendment request because the need arose only after the 1982 decision.
Syed & Co. (Respondent in C.A. 544/1985 & Appellant in C.A. 543/1985)
- Maintained that the State had no specific pleadings on valuation of timber; without pleadings, evidence is legally inadmissible.
- Supported the High Court’s view that the application was belated.
- In its own appeal, accepted that the prescribed authority lacked power to draw a decree but sought a Supreme Court direction enabling recovery of the amount due.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| State of Jammu & Kashmir v. Goodwill Forest Lessees, AIR 1974 J&K 1 (FB) | Held timber-extraction leases void, necessitating adjustment of benefits gained by parties. | Provided the backdrop for creation of the prescribed authority and the present proceedings. |
| Malik Abdul Ahmad Shah Jalil Ahmad Akhtar v. State of Jammu & Kashmir, AIR 1982 J&K 16 | Recognised the prescribed authority’s power to value timber removed by lessees. | State relied on it to seek additional evidence; Supreme Court accepted the principle but found lack of pleadings fatal to the State’s effort. |
Court's Reasoning and Analysis
The Supreme Court affirmed the High Court’s conclusions on two core grounds:
- Absence of pleadings. Although the State had prayed in the alternative for a decree based on timber value, it never pleaded the factual foundation—specifically, the basis for calculating market value—before the prescribed authority. Established procedural law bars admission of evidence without supporting pleadings. Consequently, the High Court rightly refused the State’s Order 41 Rule 27 application.
- Jurisdiction of the prescribed authority. The prescribed authority, being an administrative forum under Section 52 of the Act, lacks status as a civil court and therefore cannot direct that a civil decree be drawn. The High Court properly set aside that portion of its order.
The Court acknowledged that Malik Abdul Ahmad Shah empowers the authority to value timber but emphasised that the State should have amended its pleadings to incorporate that claim; its failure to do so was determinative.
Holding and Implications
All appeals dismissed.
Syed & Co. retains the liberty to recover the amount of Rs 3,45,762.09 “in accordance with law,” but no decree emanates from the prescribed authority itself. No costs were awarded.
The decision underscores two procedural principles: (1) evidence cannot be introduced absent relevant pleadings, even at the appellate stage; and (2) quasi-judicial authorities lacking civil-court status may not issue executable decrees, leaving successful parties to seek enforcement through appropriate legal channels. No new substantive precedent was set beyond these reaffirmations.
Order
In Civil Appeals Nos. 543 & 544 of 1985:
1. Both these appeals by grant of special leave can be dealt with under a common order as they arise from the same proceedings.
2. During the period from March 7, 1963 to April 14, 1965, lease agreements were executed between the Government of State of Jammu and Kashmir and private lessees for cutting timber from the forest of Jammu and Kashmir. These leases were held to be void by a Full Bench decision, rendered on June 15, 1973, of the Jammu and Kashmir High Court. The decision is reported in State of Jammu and Kashmir v. Goodwill Forest Lessees AIR 1974 J & K 1 (FB). In order to get over the judgment, the J & K Forest Act, 1987 was amended by incorporating Sections 52-A, 52-B and 52-C in the Act whereby the prescribed authority was constituted to determine the quantum of advantages received by the parties with reference to leases which were rendered void as a result of the judgment of the Full Bench.
3. The parties will be referred to as arrayed in C.A No. 544 of 1985.
4. On January 7, 1976 the State filed a suit for recovery of a sum of Rs 7,61,953.52 on account of royalty arrears together with interest against Syed & Co. On August 8, 1981, the prescribed authority rendered a judgment holding that the respondent has in all paid Rs 25,37,384.15; against this amount he had actually removed timber valued at Rs 21,36,611.50. In the result, it was held that he would be entitled to be paid a sum of Rs 3,45,762.09. Ultimately, the suit was dismissed. However, the authority was directed to draw up decree sheet of the order which would include the figures mentioned above. Aggrieved by this order, Civil First Appeal No. 59 of 1981 was preferred to the High Court. While the appeal was pending, the High Court in Malik Abdul Ahmad Shah Jalil Ahmad Akhtar v. State of Jammu and Kashmir AIR 1982 J & K 16 held that it was open to the prescribed authority to calculate the value of timber removed by the lessees. In view of this decision an application for amendment under Order 41 Rule 27 of the Code of Civil Procedure was preferred. The High Court rejected the application on two grounds, one, it was hopelessly belated and second, in any event, the party could not be allowed to lead in evidence on a plea not taken by it though it was supported by the judgment in Malik Abdul Ahmad Shah Jalil Ahmad Akhtar AIR 1982 J & K 16. In the result, the appeal was dismissed. But at the same time, it was held that the authority under Section 52 of the Jammu and Kashmir Forest Act, 1987 was not competent to direct the drawing up of a decree. Therefore, that part of the order of the prescribed authority was set aside. The State has preferred Civil Appeal No. 544 of 1985 against the dismissal while the respondent has preferred Civil Appeal No. 543 of 1985 challenging that part of judgment, directing deletion of drawing up of the decree.
5. The only contention urged on behalf of the State is that by virtue of the ruling in Malik Abdul Ahmad Shah Jalil Ahmad Akhtar AIR 1982 J & K 16 it is open to the prescribed authority to calculate the value of timber removed with reference to the market rates prevailing on the respective dates. Hence, evidence ought to have been allowed on that aspect. All the more so because the prayer by the State before the prescribed authority was alternative in character. That was to the effect a decree might be granted in favour of the State for the amount of price of the timber extracted from the inception of the lease up to the period extended by the authority on the current market value. Therefore, there was enough pleading with reference to this prayer that being the evidence ought not to have been shut out. Thus, the rejection of the application under Order 41 Rule 27 is wrong.
6. As regards the finding of the High Court that it was hopelessly barred by limitation, that finding overlooks the fact that the necessity for amendment arose only in view of the judgment in Malik Abdul Ahmad Shah Jalil Ahmad Akhtar AIR 1982 J & K 16. Therefore, limitation should not have been put against the State.
7. In opposition to this, the learned counsel for the respondent would urge by looking at the entire pleadings of the State before the prescribed authority, it can be seen nowhere, it has been stated as to what exactly was the basis for claiming the price of timber extracted by the respondent. Without specific pleadings in that regard, evidence could not be led in since it is a settled principle of law that no amount of evidence can be looked unless there is a pleading.
8. Therefore, without amendment of the pleadings merely trying to lead evidence is not permissible. The High Court was right in holding so. In addition on the point of limitation it has held correctly.
9. As regards the Civil Appeal No. 543 of 1985, the contention of the appellant Syed and Company is as under:
No doubt, under Section 52 of the Act, the prescribed authority could not have drawn up a decree. Nevertheless while setting aside this order, the High Court should have directed that it was open to the party to recover the same in accordance with law. This Court may give such directions.
10. We have carefully considered the above submissions. We are of the view that no exception could be taken to the judgment of the High Court. No doubt a prayer was made before the prescribed authority by the State requesting that a decree might be granted for the amount of price of timber extracted by the party. But that prayer alone was not enough. The pleadings ought to have been there as to what exactly was the basis of the prayer. We are afraid that the entire case of the State before the prescribed authority proceeded only with reference to royalty and interest thereof, but not with reference to the price of the timber. It is true that in Malik Abdul Ahmad Shah Jalil Ahmad Akhtar AIR 1982 J & K 16 it has been held that the prescribed authority under Section 52 is empowered to determine the price of timber extracted. The State at that stage, should have amended the pleading and incorporated the basis for the claim for the price of timber. But for reasons best known the State merely took out an application under Order 41 Rule 27 to lead in evidence. Of course, evidence could have been allowed if there were pleadings to that effect. In this case, there was none. It is settled law that no evidence can be let in without the pleading. The High Court was fully justified in rejecting the application.
11. We are equally convinced that the High Court was right in setting aside that part of the order of the prescribed authority asking the drawal of the decree in accordance with the observations contained in paragraph 7 of the order. The prescribed authority is not a civil court. However, we may add that it is open to the appellant in Civil Appeal No. 543 of 1985 (Syed & Co.) to recover the said amount in accordance with law. The appeals are dismissed. However, there shall be no order as to costs.
In Civil Appeal No. 1084 of 1986:
12. In view of the above order, this civil appeal will stand dismissed. There shall be no order as to costs.
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