Union of India versus Mohindra Supply Company

Arbitration-Order of Subordinate .Judge refuoing to ut a•ide award-Appeal to High Court-Single .Judge allowing appeal-Letters Patent Appeal, whethEr maintainab/£-Interpretation of codifying statu!e.•-lndian Arbitration Act, 1940 (X of 1940) s. 39(2)-Letters Patent of Lahore High Court, cl.JO.

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A dispute between the appellant and the respondent arising out of a contract for the supply of fuel was referred to arbitration. The arbitrators gave an award directing the appellant to pay a certain sum of money to the respondent' and filed the award in the court of the Subordinate Judge. The ilppellant made an application for setting aside the award but it was rejected. A~ainst this order the appellant preferred an appeal to the High Court under s. 39(1) of the Indian Arbi- tration Act, 1940, and a Single Judge allowed the appeal and set aside the award. Thereupon the respondent filed a Letter. Patent Appeal against the judgment of the Single Judge. This appeal was allowed, the judgment of the Single Judge was set aside and the order of the Subordinate Judge was restored. The appellant contended that the Letters Patent Appeal was incompetent ass. 39(2) barred a second appeal from an order passed in appeal under s. 39 ( 1).

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Held, that an appeal against the appellate order of the Single Judge was barred by s. 39(2) of the Arbitration Act. The expression "second appeal" ins. 39(2) means a further appeal from an order passed in appeal under s. 39(1) and not an appeal under s. 100 of the Civil Procedure Code, and includes an appeal under the Letters Patent. The Letters Patent of the Lahore High Court, which applied, could, by virtue of cl. 37 thereof, be amended or altered by the Legislatures. By enacting clause (2\ of s. 39 of the Arbitration Act the Legislature has prohibited an appeal under the Letters Patent against an order passed under s. 39(1). The provisions of s. 39 apply to appeals to superior courts as ''ell as to "intra-court appeals".

¶14

Madhavdas v. Vithalda.,, I L. R. (1952) Born. 570 and Radha Krishna Murthy v. Ethirajulu, I.L.R. ( 1945) Mad. 564, approved.

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Hanuman Chamber of Commerce Ltd, Delhi v . .Jassa Ram '._~ Hira Nand, A.I.R. (1948) Lah. 64, Banwari Lal Ram Dev v. The Board of Trustees Hindu College, I.L.R. ( 1948) E.P. 159

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497

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498 SUPREME OOURT REPORTS [1962]

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1961

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and M11lc/1anrl Keu-al Chand Daga v. Kis3an Das Griclhardass, (1961) 74 L.W. 408 F.B., disapproved.

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Uni'.111 of India .. In considering whether s. 39(2) has taken away the },/ ohindra Supply right of appeal under the Letters Patent the court must Company interpret the \'Ords of the statute \'ithout any predisposition towarrl!'i the state of the )a, .. · as it was before the enactment of the Arbitration Act, 1940. In interpreting a statute which codifies the Ja\v it is not permissible to start "·ith the assumption that it \·as not intended to alter the pre-existing la\'.

¶21

Narrndra Nath Sircar v. Kom/abasini Da~i, J..R. (1896) 23 I.A. 18, applied.

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Under the Code of Civil Procedure of 1882 there was a conflict of opinion amongst the High Courts on the question whether an appeal lay under the Letters Patent from an appellate order of a Single Judge in arbitration matters. The Code of l 908 by enacting s. 4 and s. 104( I) preserved the right of appeal under any other law for the time being. The Arbitration Act, 1940 removed all the pro'isions relating to arbitration from the Code and made comprehensive pro. visions in the Act. Though under the Code of 1908 an appeal did lie under the Letters Patent from an order pa.,cd by a Single Judge in exercise of appellate jurisdiction that was because the po\'Cr to hear appeals under a special la"" \Vas expressly reserved bys. 4 of the Code. There is no provi>ion in the Arbitration Act, 1940, corresponding to s. 4 of the Code and there is nothing \·hich prcsr.r\·es the jurisdiction of the High Court under the Letters Patent. Accordingly. the Lctten Patr.nt must he read subject to the provisions of s. 39 of the Arbitration Act.

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l!urrish Chuncler Cho1<·drg '"· Kali Sundari Jlebia, (1882) L.R. 10 I.A. 4, referred to.

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Crv1L APPEI.r.ATE ,JmnslllCTIO:-< : Civil Appeal No. 112 of 1958.

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Appeal from the judgment and decree dated l\fay 25, 195-1, of the Punjab High Court in L.P.A. )fo. 8~ of I !.l48 .

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.Vaunit Lal and T. M. Sen, for the appellant. S. 'I'. Desai, Clwtter Behari ancl A. G. Ratn(lparkhi, for the respondent.

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September 5. The Judgment of the Court wa8 delivered by

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SI.ah].

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SHArr, ,J.-A dispute arising under a contract relating to the supply of solidified fuel between

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3 S.C.R. SUPREME COURT REPORTS

499

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Messrs. Mohindra Supply Company-hereinafter referred to as tho respondents-and the GovernorGeneral of India in Council was referred to arbitration of two arbitrators. On March 19, 1946, the arbitrators made and published an award directing the Governor-General to pay to the respondents )'Rs. 4 7,250/- with interest at 3% from July 17, 1944, till payment. This award was filed in the court of the Subordinate Judge, First Class, Delhi. The Governor-General applied for an order setting aside the award on certain grounds which for the purposes of this appeal are not material. The Subordinate .Judge refused to set aside the award on the gr\iunds set up and rejected the application. Against the order refusing to set aside the award, ' the Governor-General preforred to the Lahore High Court an appeal which after the setting up of thfl Dominions of India and Pakistan was transferred to the Circuit Bench of the East Punjab High Court at Delhi. Falshaw, J., whc heard the appeal set nside the order, because in his "iew the dispute could not be referred to arbitration under the contract which gave rise to the dispute and "that was sufficient to invalidate the award". Against that order an appeal was preferred under cl.IO of the Letters Patent of the High Court of Lahore, which by the High Court (Punjab) Order, 1947 applied to the East Punjab High Court. Before the Appellate Bench, the Govemor-General ,; contended that the appeal under the letters Patent was prohibited by s. 39( 2) of the Indian Arbitration Act. The question whether the appeal was maintainable was referred to a Full Bench of the High Court. The Full Bench opined that an appeal from the judgment of a Single Judge exercising appellate powers did lie under cl. 10 of the Letters P<Ltent, notwithstanding the bar contained in -l. s. 39(2) of the Arbitration Act. After the opinion of the Full Bench was delivered, a Division Bench considered the appeal on its merits and set aside

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Union of India v. M ohindra Supply Company

Shah J.

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500 SUPREME COURT REPORTS [1962)

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19~1 the order of Falslrnw, J. The Union of India Union of India appeals against the rlecision of the High Court. v. N oliind<a Sutpl7 In this appeal, we arc only concerned with

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OomjJany the question whether the appeal urnler cl. 10 of the Shah J. Letters Patent of the High Court against the onler of Falshaw, .T., was maintainable. The proceedings rcl.iting to arbitration are, since the enactment of the Indian Arbitration Act X of l!H(l, govern1H] hy the provisions of that Act. The Act is a consolidating anrl amcmling stritute. It repealed the Arbitrn· tion Art of 18()(), Schedule ~ of the Code of Civil Procedure and also chi. (a) to (f) of s. 104(1) of the Corle of Civil Procedure which proYirled for appeals from orders in arbitration proceedings. Thf Act set up machinery for all contract1ml arbitrations and its provisions, subject to certain exceptio1rn, apply also to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement and as if that'. other enactment were an arbitration agreement, except in so far as the Arhitrntion Act is inconsistent with that. other enactment or with any mies made thereunder. Section 39 of the Act, which deals with appeals, provides:

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"( 1) An appeal shall lie from the following orders passed under this Aet (and from no others) to the Court authorised by law to hear appeals from origin:il rlecrces of the Court passin): the order:

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»ll order-

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(i) superr:erling an arbitration;

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(ii) on an award stat~cl in the fon· of a sp<'cial case;

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(iii) modifying or correcting a . a\"<'\rc.l;

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(iY) filing or refusing to file ar • arbitration agreement;

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3 s.C.R.

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SUPREME COURT REPORTS

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(Y) staying or refusing to stay legal proceedings where there IS an arbitration agreement;

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(vi) setting aside or refusing to set aside an award:

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1961

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Union of lndi• v. M ohindra Supply Company

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Shah J.

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Provided that the provisions of this section shall not apply to any order passed by a Small Cause Court.

(2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section sha 11 affect or take away any right to appeal to the Supreme Court."

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The two sub-sections of s. 39 are manifestly part of a single legislative pattern. By sub-s. ( 1 ), the right to appeal is conferred against the specified orders and against no other orders ; and from an appellate order passed under sub-s. ( 1) no second appeal (except an appeal to this Court) lies. On the question whether the interdict, in sub-s.!(2) operates against an appeal under the Letters Patent, there has been a divergence of opinion amongst the High Courts in India. The Bombay High Court in Madhavdas v. Vithaldas (') held that there is no further right of appeal under the Letters Patent when a Single Judge of the High Court disposee of an appeal undei- s. 39 ( 1) of the Arbitration Act. The sRme view was expressed by the Madras High Court in Radha Krishna Murthy v. Ethirajulu('). In Ilanuma.n Chamber of Commerce Ltd., Delhi v. Jassa Ram Ilira Na.nd (')and Banwari Lal Ram Dev v. The Board of Trustees, Hindu College(') it was held that a right to appeal under the Letters Patent against an order passed in appeal under s. 39( 1) IS not restricted bys. 39(2). In the view of the Lahore and the East Punjab High Courts appeals prohibited by su b-s. (2) were second appeals, i.e., appeals ur der s.-100" of the Civil Procedure Code and "Intra-court_:appeals" such as appeals under th11

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(I) I.L.R. (1952) Born. 570. (2) LL.R. (1945) Mad. 564. (3) A.I.R. (1948) Lah. M. (4) !.L.R. (1948) E.P. 159.

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li0:2 SUPREME COURT REPORTS (1962]

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196;

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Uffron of lndi1 v M oliindra Supply Compan_v

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Shah J.

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Letters Patent from an order of ~ Single Judge to a Bench of the same Court were not prohibited. The Madras High Court in a recent judg- ment-.llulchand /{eu·al Chand Daya '. J(issan Das Gridhardass (') has overruled its earlier decii;ion in Radha Krishna :IIurthy's case and has hold that s. 3!J doals only with appeals from orders passed hy a court. to a superior court and not with appeals "intra-court" and therefore s. 30(2) does not operate to prohibit :m appeal uncler the Lcttern Patent again~t the order of a Single ,Judge exercising appellate jurisdiction in an arbitration matter.

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Section 3!l(~) expressly prohibits a second appeal from an order passed in appeal under s. 30( I) except an appeal to this court. There is clear indication inherent in sub.s. (2) that the expression "second appeal" does not mean an appeal under s. JOO of the Code of Ci\·il procedure. To the interdict of a "second appeal", there is an exception in favour of an appeal to this Court; but an appeal to this Court is not a second appeal. If the legislature inten<lecl by enacting s. 39(2) nearly to prohibit appeals under s. 100 of the Code of Civil Procedure, it was plainly u11neecssary to enact an express provision saving appeals to this Court. Again an appeal under s. 3!l( I) lies against an order superseding an awanl or modifying or correcting an award, or filing or refusing to file an arbitration agreement or staying or refusing to stay legal proceedings where there is an arbitration agreement or setting aside or refusing to set a.side an award or on an a.ward stated in the form of a special case. These orders are not _decrees_ within the meaning of the Code of Civil Procedure and have not the effect of decrees under thc> Arbitration Act. Section I 00 of the Code of Civil Procedure deals with appeals from appellate decrees and not with appeals from appellate

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(I) r,1961)74L.W.«!BF,B,

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503

SUPREME COURT REPORTS

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3 S.C.R.

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-I orders. If by enacting s. 39(2) appeals from appellate decrees were intended to be prohibited, the provision was plainly otiose; and unless the context or the circumstances compel the Court will not be justified in ascribing to the legislature an intention to enact a sterile clause. In that premise the conclusion is inevitable that ¥ the expression 'second appeal' used in s. 39(2) of the Arbitration Act means a further appeal from an order passed in appeal under s. 39(1) and not an appeal under s. 100 of the Civil Procedure Code. This view was expressed by Savdekar, J., in Madhavdass v. Vithaldas (¹ ) and by Rajamannar, C. J., in Mulchand Kewal Chand Daga v. Kissan Das Gridhardass (² ) and we agree with the learned Judges that tho adjective "imports a further appeal, that is, ' numerically second appeal".

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The problem to which attention must then be directed is whether the right to appeal under the Lettcrn Patent is at all restricted by s. 39, sub-ss.(l) and(2). Clause 10 of the Letters Patent of the High Court, in so far as it is material, provides:

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"And we do further ordain that an appeal shall lie to the said High Court ......•..... ...... from the judgment (not being a judgment passed in exercise of appellate jurisdiction in respect of a decree or order made in the exercise of appellate jurisdiction by a Court subject to the superintendence of the said High Court and not being an order made in the exercise of revisional jurisdiction ........ . of one Judge of the High Court ......... ".

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1961

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Union of India v. M ohindra Supply Compariy

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Shah].

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By this clause, a right to appeal except in the cases specified, from one Judge of the High Court to a Division Bench is expressly granted. But the Letters. Patent are declared by cl. 37 subject to "4 • the leg1slat1ve power of the Governor-General in Council and also of the Governor-in-Council under (l) J.L.R. [1952] Born. 570, (2) (1961) 74 L.W. 408 F.B,

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SUPREME OOURT REPORTS [I 962]

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1961 the Government of India Act, HH5 am! mav in all l/nion of India respects be amended 01' altered in exercise of legis-

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v. lative authority. Under s. 39(1), an appeal lies M nhindra Supply C"'71pany from the orders specified in that sub·scction and Shn\ ]. from no others. The legislature has plainly expressed itself that the right of appeal against orders passed uncler the' Arbitration Act may be CXl'roised only in respect of certain orders. The right to appeal against other orders is expressly taken away. If by the express provision contained in s. 3!l(l), a right to appeal from a Judgment which may otherwise be a'ailablo under the LC'tters Patent is restricted, there is no ground for holding that clause (:?) <loes not similarly reotrict the excercisc of appellate power granted by the letters Patent. If for rea .. ~ons aforementioned the expression "second appeal" includes nn appeal under the JAJttcrs Patent, it would be impossible tu hole! that notwithstan<ling the express prohibition, an appeal uncler the Lett.cm Patent from an order 1mssccl in appeal undor sub-s.(l) is compct<,nt.

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The Punjab High Court in Banuwi I.al llc1m !Jev '. The Bourd of Trustees, llindu College (I) and the Lahore High Court in Ilanuman Chambe" of Commerce Ltd., Delhi ' . .fr1ssa Ram l/ira Nmul '), helcl that the appeals contemplated by s. 3!l are appeals tu supPrior ccJUrts and not "intm·court appeals" and therefore the right to appeal unckr the Letters Patent was not rcstrictctl by rnb-~s. (I) and (2). But a littlc_analysis of this argument is likely to exhibit the somewhat startling consequences. If the appeal contemplated by s. 3!) (1) is only an appeal to a superior court, orclcrs passccl bv u subordinate court decisions whereof arc made ai>pealable to the same court will not be app<>alable at all under the Arbitration AC't,, For instance, under the Bombav Civil Courts Ac:t, certain decisions of Assista;tt J\l(lges arc' maclc appcalable to the District Courts. An Assistant Judge is a· Judge of the District Court and under the Bombay (I) I. L. R. (194ll) E. P. 159. (21 A I. R. 11948) Lah. 64,

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3 S.C,R. SUPREME COURT REPORTS 505

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Civil Courts Act, appeals against his orders and decrees in certain cases lie to the District Court. If the argument that an appeal under cl. (1) of s.39 means an appeal to a superior court, be accepted, an appeal from an order under s. 39 ( 1) by an .A.ssistant Judge will not lie at all. There are similar provisions in the Civil Courts Acts in the other'.States as well. The qualifying expression "to the court authorised by law to hear appeals from original decrees of the Court passing the order" in s. 39 (1) does not import the concept that the appellate court must be distinct and separate from the court passing the order or the decree. The legislature has not so enacted and the context does not warrant such an interpretation. The clause merely indicates the forum of appeal. If from the decision of a court hearing a suit or proceeding an appeal will lie to a Judge or more Judges of the same court, by virtue of s. 39 ( l) the appeal will lie from the order passed under the Arbitration Act, if the order is appellable, to such Judge or Judges of that court. The argument that the right to file an appeal to the Supreme Court from orders in arbitration proceedings would be seriously restricted has in our view no substance. If an order passed in a proceeding on the original side of the High Court is appealable under s. 39 (1 ), an appeal will lie to a Division Bench of the High Court and from the order passed by the Division Bench, an appeal, by the express provision contained in sub-s. (2) will lie subject to the restrictions contained in the relevant articles · of the Constitution to the Supreme Court. If the order is not one falling within s. 39 ( 1 ), no appeal will evidently lie. It is true that against an order passed in arbitration proceeding, by a Division Bench of a High Court in an appeal, an appeal to this Court as a matter of right may lie, if the requirements of Art. 133 are fulfilled ; but if the same case is heard by a Single Judge no

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1'61

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LTnion of India v. M ohindra Supply Company

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Shah J .

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.50!} SUPREllfE COURT ItEPORTS [l!Ju::!J

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1161

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Union of India V. M chindra Supply Cwzrny

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Shah).

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such appeal will lie. But the right to appeal is a creature of statute; no litigant ha~ an inherent right to app<'al against a decision of a court. The anomaly relied upon uy the appellant occurs in second appeals, and re\·ision applications as well. If these proceedings ari! heard and disposed of by Single Judges, there is no right of appeal to this Court uut against decisions of Division Benches the right to appeal may be exercised.

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Hut it was urged that the interpretation of s. :rn should not be divorced from the setting of kgislativc history, and if regard be had to the legislative history and the dictum of the Pri,•y Council in Hnrrish Clmnder Clw11:rlry v. Kali Sundari Debia (') which has been universally followed, in considering the extent of the right of appeal under the Letters Patent, the Court would not ue justified in restricting the right of appeal which was exercisable till HJ40 by litigants against decisions of single Judges of High Courts in arbitra· tion matters from orders p'18sed in appeals. In considerillg the argument whether the right of appeal which was previously exercisable by litigants against decisions of single Judges of the High Courts in appeals from orders passed in arbitration proceedings was intended to be takon away by s. 30 (2) of the Indian Arbitration Act, the Court must proceed to interpret the words of the statute without any predisposition towards tho state of the Jaw uefore the Arbitration Act was enacted. The Arbitration Act of 1!140 is a consolidating and amending statute and is for all purposes a co<ln relating to arbitration. In dealin" with the interpretation of the Indian Succcs~ion Act, 18u5, the Privy Council 111

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(Il (188~1 L. R. IO l.A.4, 17.

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SUPREME COURT REPORTS 507

3 S.C.R.

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Narendra Nath Sircar v. Kamlabasini Dasi(') observed that a code must be construed according to the natural meaning of the language used and not on the presumption that it was intended to leave the existing law unaltered. The Judicial Committee approved of the observations of Lord Herschell in Bank of l!Jngland v. V agliano Brothers('} to the following effect :-

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"l think the proper course is in the first instance to examine the language of the statute and to ask what is its natural meaning uninfluenced by any considerations derived from the previous state of the law, and not to start with inquiring how the law previously stood, and then, assuming that it was probably intended to leave it unaltered, to see if the words of the enactment will bear an interpretation in conformity with this view. If a statute, intended to embody in a code a particular branch of the law, is to be treated in this fashion, it appears to me that its utility will be almost entirely destroyed, and the very object with which it was enacted will be frustrated. The purpose of such a statute surely was that on any point specifically dealt with by it the law should be ascertained by interpreting the language used instead of, as before, by roaming over a vast number of authorities in order to discover what the law was, extracting it by a minute citical examina t10n^. o f th e pr10r . d . . ec1s10ns .................. ,, .

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1961

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Union of India v. M ohindra Supply Company

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Shah].

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The court in interpreting a statute must therefore proceed without seeking to add words which are not to be found in the statute, nor is it permissible in interpreting a statute which codifies a branch of the law to start with the assumption that it was not intended to alter the pre-existing law; nor to add words which are not to be found in the statute, or (I) (1896) L. R. 23, I. A. 18. (2) [1891] A.C. 107, 144-145,

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cos SDPRE.ME COURT REPORTS [l!J62]

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1111

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'for which authority is not found in t.hc statute". But Union of lnJi4 v. we do not proporn to dispose of the arg 1ment mere- _lf ohtntlra Sup~("! ly on these general conHiderations. In our view, c.:.rnJl•r..,_ even the legislative history viewed in the light of Shah]. the dictum of the Prin• Council in Hurrish Chunder's case, do('S not" afford any adequate justifieation for departing from the plain and apparent intemlmcnt of the statute.

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Vn<lcr the code of Cfril Procedure of 18ii, a right of a ppoal was conferred upon litigants against certain orders by s. ;)88 and from no other such orders. Clauses (s) and (t) dealt with a right to appeal Jgainst an order under s. 514 superseding an arbitration, and an or<ler un<lC'r s.518, modifying an award. It wnS: enacted in the last paragraph., tlmt the orders pasEed in appeals under the scdion shall be final. By paragraph ~ of s. 589, it was provided :

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"When an appeal from any order is allowe1l by this chapter, it sh1dl lie to the Court to which an appeal would lie from tho decree in the suit in relation to which such order was made ....... ••.

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By s. 591 it was provided :

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"Except as proYided in this Chapter, no appeal shall liP from an order passed by any Court in the cxercisto of its original or appellate jnrisdiction."

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The Code of I Sii wa~ replacccl by the Coclc of I 882 but the provisions relating to appeals from orders were re-enact<'<! in identical terms. Before the 1lcc18ion in HurriRh Chnn<lrr'R case, the view was held, especiall~- hy the Bombay and the ~fadras High Court.a, that under el.(15) of the I..et.tcr8 Patent of the High Courts of Bombay, Madras and Cal cut ta an appeal from an order passed by a single Judge of a High Court lay only under s. 588

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:l 1:1.U.R. SUPREME COURT REPORTS 50!J

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~ of the Code and not otherwise. In Sonba'i v. Ahmed· bha'i Habibha'i (¹ ) a Full Bench of the Bombay High Court in construing the provisions of the Letters Patent of the High Court in the light of the provisions of s. 363 of the Civil Procedure Code· held that under cl. 15 of the Letters Patent and under the rules of the High Court, an appeal to the High Court from an interlocutory order made by one of the Judges lies only in those cases in which a.n appeal is allowed under the Code of Civil Procedure and its amending Acts. A similar view wae expressed by the Madras High Court in Achaya v. Ratrandu., (² ). Bnt the Privy Council in Hu.rrih Chunder Chowdry v. Kali Simdari Debia (')in a very terse observation expressed a different view, m that case one Ka3siswari executed a will devising a taluk in equal shares to her daughter Clnmdermoni and her cfaughter-in-law Kali Soondari. After the death of Kassiswari, the two devisees under the will sued one Hurrish Chander for a decree for possession of the taluk. The Subordinate Judge decreed the suit and that decree was ultimately a.ffirmed by the Privy Council in an appeal filed by the daughters of Chundermoni, and the order of the Queen-in-Council was transmitted to the High Court for execution. In the meanwhile, Chundermoni's moiety in the taluk was purchased by Hurrish Chunder. Thereafter, Kali Sundari applied in the original jurisdiction of the High Court at Calcutta for execution of the order of the Queen-in-Council. Pontifex, J., declined to execute the order, because in his view it could not be executed by one only out of the two original plaintiffs. Against that order, an appeal was preferred under cl. 15 of the Letters Patent of the High Court. A Full Bench of the High Court was unanimously of the view that the "discretion" exercised by Pontifex, J., was erroneous but in the view of Garth, C. J., the order passed by Pontifex, J., was merely a ministerial order which he t.l; (1872) 9 Born. H. C. Reports 398. (2) I.L.R. 9 Mad. 447 (3) (1882) L.R. 10 I. A. 4, 17.

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1961

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Uni1111 o.f India v. M ohindra Supply Company

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Shah].

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510 SUPREME COURT REPORTS (1962]

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1961 had no jurisdiction to pass an<! the appeal was Union of Illliid incompetent. White and Romeshchunder Mitter, JJ.,

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v. held that the order amounted to a "juclgmont" M olii•dra S~pg Company and was appealablc under cl. 15 of the Letters Patent. Against tho order of the High Court, an Shah J. appeal was taken to the .Jiidicial Committee of tho Pri"V Council bv the defendant Hurrish Chunder _ The Judicial Committee approved of the majority view of the High Court. In negativing the argument of Garth, C.J ., the Committee pointed out that Pontifex, J., was not shown to have usurped jurisdiction which did not belong to him, but even if he had, that was a valid ground of appeal, and that if a .Judge of the High Court made an order under a misapprehension of the extent of his jurisdiction the High Court had the power to entertain an appeal to set right such a misrarriage of j11stice. The Committee then observed :

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"It only remains to observe that thoir Lordships do not think that R. 588 of Act X of 1877, which has the effect of restricting certain appeals, applies to ·such a case as this where the appeal is from one of the ,Judges of the Court to the full Court."

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This judgment (in Hurrish Chundcr Chowdry's case) gave rise to a serious conflict of opinion in the High Courts in [ndia. The High Courts of Calcutta, Bombay and Madras held, following the dictum of the Privy Council, that an order not appcalablo under s. 588 of the Civil Procedure Code may still be appealable provided it amounted to a "judgment" within the meaning of cl. I Ii of the Let tors Patent of the respccti\·c Hii;(h Courte.-Clwpzlan v. Noidin Kutti ('), S<1bhapathi Chelti v. Narayam1sirami Chetti{'), 'l'oolsee Money Das see .. Sudev·i Dl1ssee ('), and Secretary of State v. Jehwigir (').

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But the Allahabad High Court in Banno Bibi v. ~Mehdi Hu.min (') expressed a contrary opinion. It was observed by Sir John Eclgc, C. ,J., that if the (iJ I.L.R. (1899) 22 Mad. 68. (2) f.L.R. 119021 25 Mad. SSS, ') 1.J .. R. (JS99)26Cal.363. 141 [1902]4Bom. 342. (S) 1.L.R. (1889) I I All. 375.

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3 S.C.R. SUPREME COURT REPORTS 511

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order was not appealable under s. 588 ands. 591 -( of the Code of Civil Procedure it could not bo appealP.d against under the Letters Patent of the High Court. This view was affirmed by a F111! Bench of the same court in Muhammad NaimDl-Lah Khan v. lhsan-Ul-Lah Khan ('J.

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Union (J'f India v. Mohindra Supply Conparty Sh'].

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The legislature m this state of affairs intervened, and in the Code of 1908 incorporated s. 4 which by the first sub-section provided :

¶161

¶162

"In the absence of any specific provision to the contrary, nothing in this Code shall be deemed to limit or otherwise affect any 5pecial or local law now in force or any special jurisdiction or power conferred, or itny special form of procedure prescribed, by or under any other law for the time being in force";

¶163

and enacted in s. 104( I) that an appeal shrtll lie from the orders set out therein and save as otherwiee expressly provided, in the ]Jody of the Code or by any law for the time being in force, from no other orders. The legislature also expressly provi· ded that "no appeal shall lie from any order pa,ssed in appeal under this section."

¶164

Section 105 was substantially in the rnme terms its s. 591 of the earlier Code.

¶165

¶166

The intention of the legislature in enacting sub·s. (1) of s. 104 is clear: the right to app9al conferred by any other law for the time being in force lS expressly preserved. This intention lS emphasised by s. 4 which provides that in the absence of any specific provision to the contrary, nothing in the Code is intended to limit or other· wise affect any special jurisdiction or power conferred by or under any other law for the time being in force. The right to appeal against judgments (which did not amount to decrees) under the Letters Patent, was therefore not aff0cted bys. 104 (1) of the Code of Civil ProcedurA, 1908 ..

¶167

(l) 1.L.R. (1892) 14 All. 226.

¶168

512 SUPREME OOURT REPORTS [1962]

¶169

1/111 Under the Code, as amended, the view has Union 1Jf lndi11 consistently been taken that interlocutory judg·

¶170

v. ment.<l (i.e.,_ decisions though not amounting to _M oMad,a Sof>;ly Compan.'I' decrees which affect thl' merits of the question& between the parties hy determining some right or Shah J. liability) passed by single Judges of Chartered High Courts were appealablc under the Letters Patent : Ruldu Singh v. Smuml Singh('), P1m1masiran v. Ramasami ('), V11man R'.ltji Kulkarni v. S11gesh Vishnu Joshi's ('), and Ham Sarup Y. Kaniz Ummebani (').

¶171

Prior to 1940 the law relating to contractual arbitration (except in so far as it was <lea It with by tho Arbitration Act of 18()()) was contained in the Code of Civil Procedure and certain ordere passed by courts in the course of arbitration procccdingB were made appealable under the Code of 1877 bv 1.588 and in the Code of 1908 bv s. 104. In ]() tO, ·,he legislature enacted Act X of I() IO, repealing schedule 2 ands. 104 (I) els. (a) to (f) of the Code of Civil Procedure l 008 nrnl the Arbitra· tion Act of 18!!0. By s. :rn of the Act, a right. of appeal was conferred upon litigants in arbitration proceedings only from certain orders and from no others and the right to file appeals from appellate orders was expressly taken away by sub·s. 2 an<l the clause in s. 10-i of tho Code of 1H08 which preserved tho special jurisdiction nnrler any other law was incorporated in s. :19. ThP- section was enacted in a form which was absolute and not. ilU bject to any exceptions. It is true that under the Co<le of l!l08, an appeal di<l lie under the Letter~ PatPnt from an ordf'r passed hy a single Ju<lge of a Chartered High Court in arbitration proceedings even if the order was passed in exercise of appellate jurisdiction, but that was so, because, the power of the Court to hear nppc:ls under a special law for tho time being in operation was expressly prescn·ed. I (1922' 3 Lah. J88. {2) I.LR. (19331 56 MaJ. 915. 1 l.L.R. (1940) Born. 426. (4) I.LR. (1937) All. 386.

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3 S.C.R. SUPREME COURT REPORTS 513

¶176

There is in the Arbitration Act no provision 8imilar to s. 4 of the Code of Civil Procedure which preserves powers reserved to courts under special statutes. There is also nothing in the expression "authorised by law to hear appeals from original decrees of the Court" contained in s. 39( 1) of the Arbitration Act which by implication reserves th11 jurisdiction under the Letters Patent to entertain an appeal against the order passed in arbitration proceedings. Therefore, in so far as Letters Patent deal with appeals against orders passed in arbitration proceedings, they must be read subject to ths provisions of s. 39(1) and (2) of the Arbitration Act.

¶177

¶178

¶179

Under the Code of 1G08, the right to appeal • under the Letters Patent was saved both by s. 4 and the clause contained in s. 104(1), but by the Arbitration Act of 1940, the jurisdiction of the Court under any other law for the time being in force is not saved; the right of appeal can therefore be exercised against orders in arbitration proceedings only under s. 39, and no appeal (except an appeal to this Court) will lie from an appel• late order.

¶180

There is no warrant for assuming that the reservation clause in s. !04 of the Code of 1908 was as contended by counsel for the respondents, "superfluous" or that its "deletion from a. 39( 1) has not made any substantial difference" : the ;:. clause was enacted with a view to do away with the unsettled state of the law and the cleavage of opinion between the Allahabad High Court on the one hand and Calcutta, Bombay and Madras High Courts on the other on the true effect of s. 588 of the Code of Civil Procedure upon the power conferred by the Letters Patent. If the . legislature being cognizant of this difference of ~, opinion prior to the Code of 1908 and the unanimity of opinion which resulted after the amendment, chose not to include the reservation clause

,

1961

l!nion of lm/ia Mohindra ·- SJ#ly Company Shah].

¶185

514 SUPREME COURT REPORTS (1962]

¶186

m the provisions relating to appeals in the Arbi- U11io11 of India tration Act of l!l40, the conclusion is inevitable v. that it was so done with a view to rcotrict the right Jtf 1J.indrc SIJ#/y C""/ .. Y of appeal within the strict limits defined by e. 39 and to take away the right conforrcd by other Jd ]. etatutes. The Arbitration Act which is a consolidating and amending Act., being substantially in the form of a code relating to arbitration must be construed without any assumption thllt it was not intended to alter the law relating to appeals. The words of the statut are plain and explicit and they must bll given their full effect and must be interpreted in their natural meaning, uninfluenced by any assumptions derived from the pr.,vious stato of the law and without any assumption that the legislature must have intended to leave the exieting law unaltered. Jn our view the legislature has mado a cleliberat-0 departure from the law prevailing lwforc the enactment of Act X of 1940 by codifying the law relating to appeals in s. 39. Jn that view of the case, the appeal rnust be allowed. No order as to costs in this court. The order of the Di\·ision Bench of the High Court is eet aaido and the order passed by the learned Single Judge is restored. We may add that on the viow taken hy ns as to the competency of the appeal under cl. I 0 of the Letters Patent, we havo not heard counsel on the merits of th1• appeal.

¶187

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A ppml al/mud.

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Union of India v. Mohindra Supply Company

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Union of India v. Mohindra Supply Company

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