M.C. Shimla Vs Mahesh Sood deceased through Lrs. Smt. Asha Sood

The present appeal arises out of the judgment and decree, as passed by the learned District Judge, Shimla, H.P., dated 22.11.2008, whereby the appeal preferred by the plaintiff has been allowed and the judgment and decree as passed by the learned Civil Judge (Jr. Division) Court No.6, Shimla, dated 20.12.2007, was set aside, whereby the suit as filed by the plaintiff was dismissed.

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The facts as emerge in the present case are that the plaintiff/respondent filed a suit for recovery of Rs. 1,11,968/against the Municipal Corporation, Shimla. It is the case of the plaintiff that the Municipal Corporation, Shimla had awarded a

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Whether reporters of Local Papers may be allowed to see the judgment?

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work of renovation/improvement of Nullah from railway line to Nalagarh road near Laxmi Narain Temple, Totu, Shimla. The work in question was awarded to the plaintiff by the defendant vide its award letter dated 28.05.2001. The total cost of work was Rs. 1,96,677/- and period for the completion of the work was one month. The work in question was completed by the plaintiff within the stipulated period to the satisfaction of the defendant but the final payment was not made to him in spite of making various requests oral as well written. Therefore, the plaintiff was constrained to file the civil suit for the recovery of Rs. 1,11,968/- against the defendant/appellant.

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The said suit was contested by the defendant/ appellant by raising various objections such as maintainability and cause of action etc.

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On the pleadings of the parties, the learned trial Court framed the following issues:-

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“1. Whether the plaintiff is entitled to recover the suit amount as alleged? OPP

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2. Whether the plaintiff has no cause of action to file the present suit? OPD

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3. Whether the suit of the plaintiff is not maintainable for want of service of legal and valid notice under Section 392 of HPMC Act, 1994? OPD

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4. Whether the plaintiff has suppressed the material facts, if so, its effect? OPD

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5. Relief?

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The learned trial Court directed the respective parties to adduce evidence in support of their contentions.

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The Learned Civil Judge (Jr. Division) Court No.6, Shimla, vide its judgment and decree dated 20.12.2007 dismissed the suit as filed by the plaintiff.

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Feeling dissatisfied, the plaintiff preferred an appeal under Section 96 of the CPC in the Court of learned District Judge, Shimla, on 18.02.2008. The learned First Appellate Court vide its impugned judgment and decree, dated 22.11.2008, accepted the appeal as preferred by the plaintiff and decreed the suit of the plaintiff by passing a decree for recovery of Rs. 1,11,968/- along with costs. The plaintiff was also held entitled to get the interest on the said amount @ 6% per annum from the date of filing the suit till its realization.

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Feeling dissatisfied the defendant has approached this Court against the impugned judgment and decree as passed by the learned District Judge, Shimla.

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The appeal was admitted by this Court on 23.03.2009 on the following substantial question of law:-

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“Whether the findings recorded by the Lower Appellate Court while decreeing the suit are perverse?”

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It is contended by the learned counsel for the appellant that the impugned judgment and decree, as passed

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by the learned First Appellate Court, is erroneous and liable to be quashed and set aside. He submits that the learned First Appellate Court has failed to deal with the question of limitation, which was taken into consideration by the learned trial Court while invoking of Section 3 of the Limitation Act. It is further contended by the learned counsel for the appellant that the learned trial Court in para-14 of the judgment has come to the conclusion that the suit is hit by the principle of delay and laches on the part of the plaintiff, hence he has got no cause of action against the defendant. It is further contended by the learned counsel for the appellant that from perusal of the entire judgment as passed by the learned First Appellate Court, it can be seen that there is no discussion at all qua the said findings on limitation. Therefore, after accepting the present appeal, the suit as filed by the plaintiff deserves to be dismissed.

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On the other hand, learned counsel for the respondent has defended the impugned judgment and decree as passed by the learned First Appellate Court. He would submit that the learned First Appellate Court has rightly appreciated the point in controversy. He would submit that the present appeal being devoid of any merit deserves to be dismissed.

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I have heard the learned counsel for the parties and have also gone through the record carefully.

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Without touching the merits of the case, this Court will deal with the contentions as made by the learned counsel for the appellant. Admittedly, no issue with respect to the limitation was framed by the learned trial Court and while passing the judgment in para-14 and invoking Section 3 of Limitation Act, the learned trial Court came to the conclusion that the suit is barred by the principle of delay and laches. Learned counsel for the appellant has rightly pointed out while referring to the judgment as passed by the learned District Judge, Shimla that there is no discussion at all with respect to this fact. Learned counsel for the appellant has drawn the attention of this Court to the judgment passed by the Hon’ble Supreme Court in Shasidhar & others vs. Smt. Ashwini Uma Mathad & another 2015 AIR SCW 777.

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Similarly, the Coordinate Bench of this Court in RSA No. 233 of 2003, decided on 07.07.2016, has reiterated these principles as enunciated by the Hon’ble Spreme Court, which reads as under:-

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“5. The scope, ambit and power of the first appellate court while deciding the first appeal have been subject matter of various judicial pronouncements and I may refer to a recent pronouncement of the Hon’ble Supreme Court in

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Shasidhar and others vs. Smt. Ashwini Uma Mathad and another 2015 AIR SCW 777 wherein it was held as follows:

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“11. Having heard learned counsel for the parties and on perusal of the record of the case and examining the issue arising in this appeal, we find force in the submissions of the learned counsel for the appellants.”

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12. The powers of the first appellate Court, while deciding the first appeal under Section 96 read with Order XLI Rule 31 of the Code, are indeed well defined by various judicial pronouncements of this Court and are, therefore, no more res integra.

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13. As far back in 1969, the learned Judge –V.R. Krishna Iyer, J (as His Lordship then was the judge of Kerala High Court) while deciding the first appeal under Section 96 of the CPC in Kurian Chacko vs. Varkey Ouseph, AIR 1969 Kerala 316, reminded the first appellate Court of its duty as to how the first appeal under Section 96 should be decided. In his distinctive style of writing and subtle power of expression, the learned judge held as under:

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“1. The plaintiff, unsuccessful in two Courts, has come up here aggrieved by the dismissal of his suit which was one for declaration of title and recovery of possession. The defendant disputed the plaintiff's title to the property as also his possession and claimed both in himself. The learned Munsif, who tried the suit, recorded findings against the plaintiff both on title and possession. But, in appeal, the learned Subordinate Judge disposed of the whole matter glibly and briefly, in a few sentences.

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2. An appellate court is the final Court of fact ordinarily and therefore a litigant is entitled to a full and fair and independent consideration of the evidence at the appellate stage. Anything less than this is unjust to him and I have no doubt that in the present case the learned Subordinate Judge has fallen far short of what is expected of him as an appellate Court. Although there is furious contest between the counsel for the appellant and for the respondent, they appear to agree with me in this observation.....”

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(Emphasis supplied)

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14. This Court in a number of cases while affirming and then reiterating the aforesaid principle has laid down the scope and powers of the first appellate Court under Section 96 of the Code.

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15. We consider it apposite to refer to some of the decisions.

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16. In Santosh Hazari vs Purushottam Tiwari (Deceased) by L.Rs . (2001) 3 SCC 179, this Court held (at pages 188-189) as under:

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“.........the appellate court has jurisdiction to reverse or affirm the findings of the trial court. First appeal is a valuable right of the parties and unless restricted by law, the whole case is therein open for rehearing both on questions of fact and law. The judgment of the appellate court must, therefore, reflect its conscious application of mind and record findings supported by reasons, on all the issues arising along with the contentions put forth, and pressed by the parties for decision of the appellate court......while reversing a finding of fact the appellate court must come into close quarters with

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the reasoning assigned by the trial court ... and then as sign its own reasons for arriving at a different finding. This would satisfy the court hearing a further appeal that the first appellate court had discharged the duty expected of it............”

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17. The above view has been followed by a three-Judge Bench decision of this Court in Madhukar & Ors.v. Sangram & Ors. ,(2001) 4 SCC 756, wherein it was reiterated that sitting as a court of first appeal, it is the duty of the High Court to deal with all the issues and the evidence led by the parties before recording its findings.

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18. In H.K.N. Swami v. Irshad Basith ,(2005) 10 SCC 243, this Court (at p. 244) stated as under:

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“3.The first appeal has to be decided on facts as well as on law. In the first appeal parties have the right to be heard both on questions of law as also on facts and the first appellate court is required to address itself to all issues and decide the case by giving reasons. Unfortunately, the High Court, in the present case has not recorded any finding either on facts or on law. Sitting as the first appellate court it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording the finding regarding title.”

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19. Again in Jagannath v. Arulappa & Anr. (2005) 12 SCC 303, while considering the scope of Section 96 of the Code this Court (at pp. 303 -04) observed as follows:

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“2.A court of first appeal can reappreciate the entire evidence and come to a different conclusion.........”

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20. Again in B.V Nagesh & Anr.vs. H.V.Sreenivasa Murthy, (2010) 13 SCC 530, this Court taking note of all

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the earlier judgments of this Court reiterated the aforementioned principle with these words:

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“3. How the regular first appeal is to be disposed of by the appellate court/High Court has been considered by this Court in various decisions. Order 41 CPC deals with appeals from original decrees. Among the various rules, Rule 31 mandates that the judgment of the appellate court shall state:

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(a) the points for determination;

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(b) the decision thereon;

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(c) the reasons for the decision; and

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(d) where the decree appealed from is reversed or varied, the relief to which the appellant is entitled. 4. The appellate court has jurisdiction to reverse or affirm the findings of the trial court. The first appeal is a valuable right of the parties and unless restricted by law, the whole case is therein open for rehearing both on questions of fact and law. The judgment of the appellate court must, ... therefore, reflect its conscious application of mind and record findings supported by reasons, on all the issues arising along with the contentions putforth, and pressed by the parties for decision of the appellate court. Sitting as a court of first appeal, it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording its findings. The first appeal is a valuable right and the parties have a right to be heard both on questions of law and on facts and the judgment in the first appeal must address itself to all the issues of law and fact and decide it by giving reasons in support of the findings. (Vide Santosh Hazari v.Purushottam Tiwari , (2001) 3 SCC 179 at p. 188,

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para 15 and Madhukar v.Sangram , (2001) 4 SCC 756 at p. 758, para 5.)”.

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“5. In view of the above salutary principles, on going through the impugned judgment, we feel that the High Court has failed to discharge the obligation placed on it as a first appellate court. In our view, the judgment under appeal is cryptic and none of the relevant aspects have even been noticed. The appeal has been decided in an unsatisfactory manner. Our careful perusal of the judgment in the regular first appeal shows that it falls short of considerations which are expected from the court of first appeal. Accordingly, without going into the merits of the claim of both parties, we set aside the impugned judgment and decree of the High Court and remand the regular first appeal to the High Court for its fresh disposal in accordance with law.”

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21. The aforementioned cases were relied upon by this Court while reiterating the same principle in State Bank of India & Anr. vs. Emmsons International Ltd. & Anr.(2011) 12 SCC 174. This Court has recently taken the same view on similar facts arising in Vinod Kumar vs. Gangadhar, 2014(12) Scale 171.”

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Similar issue came up before the Hon’ble Supreme Court in Union of India Vs. K.V. Lakshman and others, Civil Appeal No. 920 of 2008, decided on 29.6.2016 , wherein it was held as under:-

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“22. It is a settled principle of law that a right to file first appeal against the decree under Section 96 of the Code is a valuable legal right of the litigant. The jurisdiction of the first appellate Court while hearing the first appeal is very wide like that of the Trial Court and it is open to the appellant to attack all findings of fact or/and of law in first appeal. It is the duty of the first appellate Court to appreciate the entire evidence and may come to a conclusion different from that of the Trial Court.

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23. Similarly, the powers of the first appellate Court while deciding the first appeal are indeed well defined by various judicial pronouncements of this Court and are, therefore, no more res integra. It is apposite to take note of the law on this issue.

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24. As far back in 1969, the learned Judge – V.R. Krishna Iyer, J (as His Lordship then was the judge of Kerala High Court) while deciding the first appeal under Section 96 of the CPC in Kurian Chacko vs. Varkey Ouseph, AIR 1969 Kerala 316, reminded the first appellate Court of its duty to decide the first appeal. In his distinctive style of writing with subtle power of expression, the learned judge held as under:

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“1. The plaintiff, unsuccessful in two Courts, has come up here aggrieved by the dismissal of his suit which was one for declaration of title and recovery of possession. The defendant disputed the plaintiff's title to the property as also his possession and claimed both in himself. The learned Munsif, who tried the suit, recorded findings against the plaintiff both on title and possession. But, in appeal, the learned Subordinate Judge disposed of the whole matter glibly and briefly, in a few sentences.

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2. An appellate court is the final Court of fact ordinarily and therefore a litigant is entitled to a full and fair and independent consideration of the evidence at the appellate stage. Anything less than this is unjust to him and I have no doubt that in the present case the learned Subordinate Judge has fallen far short of what is expected of him as an appellate Court. Although there is furious contest between the counsel for the appellant and for the respondent, they appear to agree with me in this observation…..” (Emphasis supplied)

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25. This Court also in various cases reiterated the aforesaid principle and laid down the powers of the appellate Court under Section 96 of the Code while deciding the first appeal.

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26. We consider it apposite to refer to some of the decisions.

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27. In Santosh Hazari vs. Purushottam Tiwari (Deceased) by L.Rs. (2001) 3 SCC 179, this Court held (at pages 188189) as under:

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.……..the appellate court has jurisdiction to reverse or affirm the findings of the trial court. First appeal is a valuable right of the parties and unless restricted by law, the whole case is therein open for rehearing both on questions of fact and law. The judgment of the appellate court must, therefore, reflect its conscious application of mind and record findings supported by reasons, on all the issues arising along with the contentions put forth, and pressed by the parties for decision of the appellate court……while reversing a finding of fact the appellate court must come into close quarters with the reasoning assigned by the trial court and then

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assign its own reasons for arriving at a different finding. This would satisfy the court hearing a further appeal that the first appellate court had discharged the duty expected of it…………”

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28. The above view was followed by a three-Judge Bench decision of this Court in Madhukar & Ors. v. Sangram & Ors.,(2001) 4 SCC 756, wherein it was reiterated that sitting as a court of first appeal, it is the duty of the High Court to deal with all the issues and the evidence led by the parties before recording its findings. 29. In H.K.N. Swami v. Irshad Basith,(2005) 10 SCC 243, this Court (at p. 244) stated as under: (SCC para 3)

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“3. The first appeal has to be decided on facts as well as on law. In the first appeal parties have the right to be heard both on questions of law as also on facts and the first appellate court is required to address itself to all issues and decide the case by giving reasons. Unfortunately, the High Court, in the present case has not recorded any finding either on facts or on law. Sitting as the first appellate court it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording the finding regarding title.”

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30. Again in Jagannath v. Arulappa & Anr., (2005 12 SCC 303, while considering the scope of Section 96 the Code of Civil Procedure, 1908, this Court (at pp. 303-04) observed as follows: (SCC para 2)

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“2. A court of first appeal can reappreciate the entire evidence and come to a different conclusion……...”

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31. Again in B.V Nagesh & Anr. vs. H.V Sreenivasa Murthy, (2010) 13 SCC 530, this Court taking note of all

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the earlier judgments of this court reiterated the aforementioned principle with these words:

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“3. How the regular first appeal is to be disposed of by the appellate court/High Court has been considered by this Court in various decisions. Order 41 CPC deals with appeals from original decrees. Among the various rules, Rule 31 mandates that the judgment of the appellate court shall state:

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(a) the points for determination;

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(b) the decision thereon;

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(c) the reasons for the decision; and

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(d) where the decree appealed from is reversed or varied, the relief to which the appellant is entitled.

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4. The appellate court has jurisdiction to reverse or affirm the findings of the trial court. The first appeal is a valuable right of the parties and unless restricted by law, the whole case is therein open for rehearing both on questions of fact and law. The judgment of the appellate court must, therefore, reflect its conscious application of mind and record findings supported by reasons, on all the issues arising along with the contentions put forth, and pressed by the parties for decision of the appellate court. Sitting as a court of first appeal, it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording its findings. The first appeal is a valuable right and the parties have a right to be heard both on questions of law and on facts and the judgment in the first appeal must address itself to all the issues of law and fact and decide it by giving reasons in

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support of the findings. (Vide Santosh Hazari v. Purushottam Tiwari, (2001) 3 SCC 179 at p. 188, para 15 and Madhukar v. Sangram, (2001) 4 SCC 756 at p. 758, para 5.)

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5. In view of the above salutary principles, on going through the impugned judgment, we feel that the High Court has failed to discharge the obligation placed on it as a first appellate court. In our view, the judgment under appeal is cryptic and none of the relevant aspects have even been noticed. The appeal has been decided in an unsatisfactory manner. Our careful perusal of the judgment in the regular first appeal shows that it falls short of considerations which are expected from the court of first appeal. Accordingly, without going into the merits of the claim of both parties, we set aside the impugned judgment and decree of the High Court and remand the regular first appeal to the High Court for its fresh disposal in accordance with law.” 32. The aforementioned cases were relied upon by this Court while reiterating the same principle in State Bank of India & Anr. vs. Emmsons International Ltd. & Anr., (2011) 12 SCC 174.”

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It is well settled principle of law that right to file first appeal against the decree under Section 96 of the Code of Civil Procedure is a valuable legal right of the litigant. The jurisdiction of the First Appellate Court while hearing the first appeal is very wide like that of learned trial Court and it is open to the appellant to attack all findings of fact or/and of law in the first appeal. It is duty of the first appellate Court to

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appreciate the entire evidence and may come to a different conclusion from that of the trial Court. While doing so, the judgment of the appellate Court must reflect its conscious application of mind and record findings supported by reasons, on all issues arising along with the contentions put forth, and pressed by the parties for decision of the appellate Court. While reversing a finding of fact, the Appellate Court must come into close quarters with the reasoning assigned by the trial Court and then assign its own reasons for arriving at a different finding. This would satisfy the court hearing a further appeal that the first appellate Court had discharged the duty expected of it.

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Coming to the facts of the case, the learned trial Court while invoking the provisions of Section 3 of the Limitation Act came to the conclusion that the suit filed by the plaintiff is barred by the principle of delay and laches. Once, there are categorical findings returned by the learned trial Court, it was incumbent upon the learned First Appellate Court to have discussed and touched the said point and should have given its own independent findings. From the perusal of the same, it can be gathered that there is no discussion/ determination/adjudication by the learned First Appellate Court on the said aspect.

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Consequently, in view of the aforesaid exposition of law, the impugned judgment and decree as passed by the learned District Judge on 22.11.2008, cannot be countenanced and sustained. Therefore, this Court has no other option but to set aside the impugned judgment and decree as passed by the learned District Judge and remand the matter back for decision afresh. Ordered accordingly.

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The parties are directed to appear before the learned District Judge, Shimla on 07.07.2026 . Since the suit was instituted way back in the year 2005 i.e. about 21 years ago, the learned District Judge, Shima is requested to decide the appeal as early as possible and in no event later than 24.09.2026.

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In view of the above discussion, the present appeal stands disposed of. Pending applications, if any, also stand disposed of.

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(Romesh Verma) Judge

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20^th June, 2026. (kck)

M.C. Shimla v. Mahesh Sood deceased through Lrs. Smt. Asha Sood

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M.C. Shimla v. Mahesh Sood deceased through Lrs. Smt. Asha Sood

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