Dismissed¶93

Shanti Kumar R. Canji v. the Home Insurance Co. of New York

Supreme Court24 Jul 19741974 INSC 126 · [1975] 1 S.C.R. 5501974 INSC 126

Case brief

AI extract

What is this about?

Shanti Kumar R. Canji v. Home Insurance Co. of New York (1974) — meaning of 'judgment' under clause 15 of the Letters Patent; appealability of orders allowing amendment of plaint; amendment defeating defendant's accrued plea of limitation constitutes a judgment; two tests (final pronouncement; determination of right or liability); nature versus form of order; review of discretionary amendment orders; no special circumstances for time-barred claim; Asrumati Debi followed; Dayabhai and Manohar overruled; Civil Appeal No. 1991 of 1971; [1975] 1 S.C.R. 550.

What did the court decide?

None; the appeal was dismissed with costs and the judgment of the High Court was upheld. ¶93

Shanti Kumar R. Canji versus the Home Insurance Co. of New York — Supreme Court (1975) — LawSathi Research

What the court decided

AI extract

Outcome

None; the appeal was dismissed with costs and the judgment of the High Court was upheld.

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Issue for consideration

Whether an order of the trial court allowing amendment of the plaint is a 'judgment' within the meaning of clause 15 of the Letters Patent and hence appealable. +1 more

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Court's answer

A judgment within the meaning of clause 15 of the Letters Patent must, first, be the final pronouncement which puts an end to the proceeding so far as the court dealing with it is concerned.

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Ratio / Principle

Second, a judgment within clause 15 must involve the determination of some right or liability, though it is not necessary that there be a decision on the merits.

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Key takeaways

Whether a decision is a judgment under clause 15 is to be found by examining whether the order affects the merits of the action between the parties by determining some right or liability; it is the nature of the order, not its form, that governs.ratio¶91
An amendment that merely allows the plaintiff to state a new cause of action, ask a new relief or include a new ground of relief does no more than regulate the procedure of the suit and does not touch the merits; such an amendment is not a judgment within clause 15.ratio¶16

Detailed headnote1 paragraphs

Supreme Court of India (Ray, C.J.; Mathew, J.), dismissing Civil Appeal No. 1991 of 1971 on 24 July 1974, upheld the Bombay High Court's judgment of 29 March 1971 setting aside the order of 6 July 1970 that had allowed the appellant to amend his plaint to claim Rs. 68,000 as damages for loss of pension. Held: (i) a judgment within clause 15 of the Letters Patent must (a) be the final pronouncement putting an end to the proceeding before the court concerned and (b) involve determination of some right or liability, a decision on the merits not being necessary; the nature, not the form, of the order is decisive; (ii) an amendment merely opening a new cause of action, relief or ground of relief only regulates procedure and is not a judgment, but an amendment that strips the defendant of his limitation-based immunity from liability is a judgment under clause 15, being a merits-affecting determination of right or liability and final so far as the trial court is concerned; (iii) an amendment order is not purely discretionary, and appellate interference is permissible where it is insupportable in law or unjust; there were no special circumstances justifying this amendment. Asrumati Debi followed; Justice of the Peace for Calcutta, Tuljaram and M.B. Sirkar approved; Charan Das referred to; Dayabhai v. Murugappa Chettiar and Manohar v. Baliram overruled.

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550

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SHANTI KUMAR R. CANJI v.

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THE HOME INSURANCE CO. OF NEW YORK

July 24, 1974.

[A. N. RAY, C. J. AND K. K. MATHEW, J.]

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Utters Patent of the Bombay High Court, Cl. 15-Judgment, what is

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The appellant filed the suit against the respondent in 1964, on the original side of the High Court, claiming six months salary in lieu of notice and gratuity. An application for amendment of the plaint in regard to damages for the right to pension was made in 1970. The respondent contended that the amendment should not be allowed on the ground inter a/ia that the alleged claim was barred by limitation in 1970. The trial Court aUowed the amendment, but in appeal under 0. 15 of the Letters Patent, the order was set aside. The High Court considered the application for amendment to be a new claim based upon a new set of facts which became barred on the date of the application for amendment.

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I ~ ' "

In appeal to this Court, it was contended that: (1) the order of the trial Court was not a judgment and hence not appealab]e under Cl. 15, and (2) the order was a ·discretionary order and the appel1ate Court should not have interfered with the exercise of discretion. '

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Dismissing the appeal,

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HELD : (1) A judgment within the meaning of Cl. 15 would have to satisfy two tests, {a) it must be the final pronouncement which puts an end to the pro~ ceeding so far as the Court dealing with it is concerned; and (b) it must involve the deterinination of some right or liability though it may not be necessary that there must be a decision on the merits. [554 BJ ln finding out whether any decision is a' judgment within the meaning of Cl. 15, each case must be looked into in order to find out whether there is a decision <ietemining the right or liability of the parties affecting the merits of the controversy between the parties .. It is not the form but the nature of the order that has to be examined in- order to ascertain whether there has been a determination of any .right or liability. If an amendment merely allows the plaintiff to state a new cause of action or to ask a new relief or to include a new ground of relief al] that happens is that it is possible for the plaintiff to raise further contentions in the suit, but it is not <lecided whether the contentions are right. Such an amendment does nothing more than regulate the procedure applicable to the suit and does not touch the merits of the controversy between the parties. Where, on the other hand, an amendment takes away from the defendant the defence of immunity from any liability_ by reason of limitation, it is a judgment within the meaning of CL 15. The reason why it be·Comes a judgment is that it is a decision affecting the merits of the question between the parties by determining the right or liability based on limitation. It is the final deCision as far as the Court is concerned. The respondent, in the present case, has acquired. by reason of limitation, immunity from liability, and the appellant, because of the limitation of the cause of action, has no power to render the respon<lent liable for the alleged claim. [554 B-C, G., 555F-H,556A-C] (2) The order of the trial Court is not one purely based on discretion, and even with regard to discretionary orders the appellate Court can interfere where the order is unsupportable in law or is unjust. The High Court was right in holding that there were no special circumstances to entitle the appellant to introduce the claim by amendment. [556F] Asrumati Debi v. Kumar Rupendra Deb Raikot & Ors. [1953} S. C. R. 1159, followed. Justice of the Peace for Calcutta v. Oriental Gas Company, 8 Bengal L. R. 433, Tu/l'aram v. A/agappa I. L. R. 35 Mad. 1., M. B. Sirkar & Sons v. Powell & Co. A.I.R. 1956. Cal. 630, approved. Charan Das v. Amir Khan 47 I. A. 255 referred to. Dayahhai v. Murugappa Chettiar I. L. R. 13 Rang. 457 and Manohar v . . B11i/ram I.L. R. 1952 Nag. 471, overruled.

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E 'r

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5 5 1

SHANTI KUMAR V. HOME !NSURAKCE CO.

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ARGUMENTS

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A B c D	Forthe appellant:On the first point, an order allowing amendment is not a "Judgment" within the meaningofclause15ofthe Letters Patent. Divergentviewshave been taken by various High Courts astothe meaningofword "Judgment". This question came before this Court also in thecruseof'Asrumatidevi'(1953)SCR 1159-where a question arose whether an order for transfer of a suit under clausel3ofthe Letters Patent (Calcutta High Court) is not a "Judgment" within the meaning ofclause15of the Letters Patent; and this Court took the view that an orderofthis character could not be regarded as a 'Judgment' butitdid not determine the true meaning and scopeofthe word "Judg- ment", nor did it resolve awidedivergence of judicial opinion on the subject. An order to be a 'Judgment' inCl.15ofthe Letters Patent must either determine some right or liability which is in controversy in the suit either partiallyorwholly; or it should terminate the procee- dings even without deciding any righto~liability in controversy. Any wider definitionofthe word 'Judgment'willmake all orders appea- lableirn<lctiv'JftilJir nature and irrespective of the procee- ding in which they arepassed.An interim order which does not deter- mine any substantive right or liability in controversy (i.e. does not grant or refuse any part of the relief prayed for in a suit) but decides a procedural right, however important,isnot a 'judgment'. An order ;iJlowing the amendment does not decide any substantive right or lia- bility.Itonly permits a claim to be agitated and does not decide the claim and, therefore, the orderofthe single judgewasnot appealable. _Justiceofthe Peace for Calcutta_v._The OrientalGasCo._8 Bengal L.R.433,_Tuljaram_v._Alagappa Che/ter_I.LR.35Mad., 1;I.LR.Rang. 457and I.L.R.[1952]Nag.471(F.B.) referred to.
E	Onthe second point, itissettled lawthatan appellate Courtwill not interfere with such an order passed by the trial Court in excer- cise of its discretion without exceeding the limits,ofits power, unless it acted perversely or unless theviewtaken by itisclearly wrong. The amendment sought for became necessary as on the true and full dis- closureofthe terms of Pension Rules, the Appellantwasfound tobe entitled to damages in lieuofpension.
F	The principle of_res judicata_did not apply as the earlier orderof theSingleJudge allowing the first amendment application partly on 19-1-1970did not deal with the claim for amortised damage now sought tobeadded.
G H	_Forthe Respondent:_Thereisnoneed togointo the larger ques- tion because judged by the tests laid down bya11the High Courts in- cluding the Nagpur High Court, the decision of the trial Court in the instant case allowing the amendment,isa judgment within the mea- ningofCl.15ofthe Letters Patent.Byreason of the amendmentofthe plaint, the claim made in the amended plaint dates back to the date,of the plaint. The application for amendmentwasfiledin Apri), I970 andbythat time, the claim for pensionwasclearly barred by limi- tation.Byallowing amendment, the valuable right which had accrued to the defendant to resist the claim for pension, has been lost the defendants cannot therefore, once the amendmentisallowed raise the pleaoflimitation. Thereisa clear negation of valuable right of

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[1975] 1 S.C.R.

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SUPREME COURT REPORTS

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552

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the defendant which is undoubtedly a determination of right or liability as between the two parties. There is difference between the amendment which does not take away the right of the defendant to plead limitation and an amendment which affects the rights of the defendants to raise the plea of limitation 1946 Calcutta 630; 1946 Born. 361; AIR 1972 Bombay 27 ; 1967 (2) M.L.J. (FB) referred to.

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35 Madras at p. 9 lays down the law that the fact that the order is one a!Jowi!lg the amendment, is not deeisive and that if in any proceeding, the defendants could have succeeded by the Court passing an order as prayed for, that itself is sufficient to make a decision a judgment and the fact that the defendant's contention was negatived i.e. an order prayed by him was not passed; does not make the decision any the Jess a judgment under Cl. 15. 29 Bombay 249, 253 in [1953] S.C.R. 1159, 1168. 70 Ca. W.N. 670, [1971] S.C.R. 783 referred to.

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By allowing the amendment, the right is ~conferred upon the plaintiff and it carries with it the fastening of liabilities upon the defendants.

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The decision on a vital points adverse to the \lefendant which goes to the root of the matter and which becomes final and conclusive, so far as the conrt passing of the or.der is concerned, would amount to a Judgment because the order is to the effect that the plaintiff is entitled to make the claim negativing the right of the defendants which has accrued to him by lapse of time.

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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1991 of 1971.

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From the Judgment and Order dated the 29th March, 1971, of the Bombay High Court and Bombay in Appeal No. 87 of 1970. V.M. Tarkunde and Rameshwar Nath for the appellant· K.S. Ramamurthy and B.R. Aganval for the respondent.

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The Judgment of the Court was delivered by

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RAY, C. J.-This is an appeal by certificate from the judgment dated 29th March, 1971 of the High Court of Bombay.

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The appellant filed this suit on 2 September, 1964 in the High Court of Bombay and claimed six months salary in lieu of notice and gratuity for 16 years of service.

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Jn the year 1965 the appellant asked for discovery by the respondent of documents relating to pension scheme for foreign employees. The application for discovery was dismissed in the month of November, 1965.

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On 16 December, 1969theappellant took out a Chamber Summons for ammdment of the plaint. The proposed amendments were twofold. The first set of amendment related to averments in support of the claim for gratuity which had already been alleged in the plaint.

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SHANTI 1UMAR V. HOME INSURANCE CO. (Ray, C.J.) 553

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A The second set of amendment related to averments in support of a claim for Rs. 850 per month by way of pension as and from 1 February, 1964 during the life time of the appellant.

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By an order dated 19 January, 1970 the appellant was allowed to amend the plaint in respect of the claim for gratuity. The appellant's proposed amendment in support of the claim for pension was refused. ll

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By summons dated 27 April, 1970 the appellant sought an amend· ment of the plaint claiming Rs. 68,000 as damages in relation tc his right to pension. By an order dated 6 July, 1970 the appellant was allowed to amend the plaint as prayed for.

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The respondent preferred an appeal against the order dated 6 July, c 1970. The High Court by judgment dated 29 March, 1971 allowed the appeal and set aside the order dated 6 July, 1970 allowing the amendment.

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The appellant repeated the contentions which had been advanced before the High Court. first, it was said that no appeal could lie against an order of amendment because it was not a judgment within .D the meaning of clause 15 of the Letters Patent. Secondly, it was said that an order allowing the amendment was a discretionarv order. Therefore, the appellate court should not have interfered ,;·ith the discretion.

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Counsel for the appellant submitted that 'judgment' means a decision finally adjudicating the rights between the parties. It was emphasised that a judgment would be a decision on substantive rights of parties. 'Amendment' was submitted to be a procedural right. Counsel for the appellant relied on the decision in Dayabhai v. MurrugaPpa Chettiar I. L. R. 13 Rang. 457 and Manohar v. Baliram · I.L.R. 1952 Nag. 471 in support of the proposition that 'judgment' means and is a decree in a suit by which the rights of the parties in the suit are determined.

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F The locus classicus is the decision of the High Court of Calcuta in Justice oft he Peace for Calcutta v. Oriental Gas Company 8 Bengal L.R. 433 where Sir Richard Couch, C. J. said "We think tj:Jat 'judgment' means a decision which affects the merits of the question between the parties by determining some right or liability. It may be either final or preliminary, or interlocutory, the difference between them being that a final judgment determines the whole cause or suit, and a prelimi- G nary or interlocutory judgment determines only a part of it, leaving other matters to be determined."

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This Court in Asrumati Debi v. Kumar Rupendra Deb Raikot & Ors • [1953) S.C.R. 1159 dealt with the question as to whether an order of transfer of a suit filed in the Jalpaiguri Court to the High Court to be tried in its Extraordinary Original Civil Jurisdiction was a judgment ff within the meaning of clause 15 of the Letters Patent. It was held that an order for transfer of a suit is not a judgment within the meaning of clause 15 of the Letters Patent as it neither affects the merits of the

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[1975] 1 s.c.R.

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554

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SUPREME COURT REPORTS

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controversy between the parties in the suit itself nor terminates or d}sposes of the suit on any ground.

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This Court in Asrumati Debi's case (supra) said that a judgment within the meaning of clause 15 of the Letters Patent would have to satisfy two tests. First, the judgment must be the final pronouncement which puts an end to the proceeding so far as the court dealing with it is concerned. Second, the judgment must involve the determination of some right or liability though it may not be necessary that there must be a decision on the merits. In this context this Court referred to observation of the Full Bench of the High Court of Madras in Tu/j«ram v. A/agappa I.L.R. 35 Mad. I. The test formulated by the Madras decision is not the form of the adjudication but its effect on the suit or proceeding in which it is made. The Madras Hight Court said "if the effect is to put an end to the suit or proceeding so far as the Clurt before which the suit or proceeding is pending is concerned, or if its effect, if it is not complied with, is to put an end to the suit or proceeding, the adjudication is a judgment". It may be stated here that the Madras High Court spoke of 'judgment' on an application in a suit. The decision of the Madras High Court in Tuljaram' s case (supra) was on an order for transfer of a suit under clause 13 of the Letters Patent.

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This Court also noticed the view expressed by the Madras High Court in Tuljaram's case (supra) that adjudication on an application, which is nothing more than a step towards obtaining a final adjudication in the suit, is not a judgment within the meaning o.f the Letters Patent. In Asrumati Debi's case (supra) this Court noticed the argument advanced that if an order refusing to rescind leave to sue granted under clause 12 of the Letters Patent was a 'judgment' under clause 15 of the Letters Patent there was no difference in principle between an order of th1t description and an order transferring the smt under clause 13 of the Letters Patent. This Court did not express any opinion excepting observing that if leave under clause 12 of the Letters Patent was rescinded, the suit would c:ome to an end and if an order was made refusing to rescind the leave the result would be on a vital point adverse to the defendant and it would go to the root of the suit and become final and decisive against the defendant so far as the Court making the order was concerned.

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In finding out whether any decision is a judgment within the meaning of clause 15 of the Letters Patent each case must be looked into in order to find out as to whether thereiso decision determining the right or liability of the parties affecting the merits of the controversy between the parties. It is in that light that this Court in Asrumati Dibi's case (supra) described the order refusing to rescind leave to bo within the category of a judgment as laid down in the Calcutta cases though no final opinion was expressed as to the propriety of that view.

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Th! present appeal concerns an application for amendment of the plaint. The suit was filed in the year 1964. The application for am!ildm!nt of the plaint in regard to damages for the right to pension was made in the y~ar 1970. An amendment, if allowed, would relate

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SHANTI KUMAR v. Hop.rn INSURANCE co. (RllJ', C.J.)

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555

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	A	tothe dateofthe institutionofthe suit. The respondent contended before the trial Court entertaining the application fer amendmentofthe plaint that the amendment should not bealkwed_interalia_onthe groundthatthe alleged claimwasbarred by limitation in1970.
	II	The High Court in the present case reliedonthe decidonofthe High CourtatCalcutta in_M.B. Sarkar_&_Sons_v.Powell&Cc. A.LR.1956Cal.630. Inthat case an amendmentwasallowedon Chambers Summons substituting in placeofthe original defendant
•	c D E F	which was describedasa firm a defendant converted into accmpany in that name. The companysoproposedtobe substitutedccmplained that the amendmenttookaway fromita valuable right which had accrued toitby efiluxoftime, and, therefore, the amendment shculd not be allowed. The contentionofthe defendant was not acceptedby the learned Chamber Judge. The High Court on appeal set aside the or· der.Itwas not heldtobe a caseofmis-descriptionofthe defendant. A mis-descriptionofa party impleaded can arise when the party really intendedtobeimpleaded had always been the same and such intention appeared clearly from the bodyofthe plaint in spiteofthe inaccurate mis-description in the cause title.Insuch a case, it wculd not be ad- ding a new partyorsubstituting a new party for the origim 1 one,but perfecting the identityofthe party originally impleaded clearingor rectif}ing the inaccurate description. When the same person, whether anindividualora legal entity, remains the defendant but only the name is altered,itwouldbea caseofmis-descripticn. Where a newItgal entity is substituted, itwasheld in the_M.B.Sirkar_case (supra) that substitutionofa company for a firm would be a changeofa sub- stantial character affecting the rightofa party. Thee!frctofthe amendment in theAf._B.Sirkar_case (supra) wastosubstitute a new party for the party originally impleaded and the consequence was totake away from the new partysosubstituted his defenceoflimita tion that a suit brought on the dateofthe amendment would be bar- red by time. Chakravartti,C.J.in_the M.B.- Sirkar_case (supra) said thatanorder for amendmentofthe plaint there decided a vital question concerning the meritsofthe case and the rightsofthe newly impleaded party and therefore became a judgment within the meaning ofclause15ofthe Letters Patent.

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The right to claim that an introduction of a cause of action by amendment is barred by limitation is founded on immunity from a liability. A right is an averment of entitlement arising out of legal rules. A legal right may be defined as an advantage or benefit conftTred upon G a person by a rule of law. Immunity in short is no liability. It is an immunity from the legal power of some other person. The correlative of immunity is disability. Disability mef!ns the absence of power. The appellant in the present case because of the limitation of the cause of action has no power to render the respondent liable for the alleged claim. The respondent has acquired by reason of limitation immunity from any liability.

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H The views of the High Courts at Calcutta and Madras with regard to th' meaning of 'judgment' are with respect preferred to the mraning of 'judgment' given by the Rangoon and Nagpur High Courts.

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[1975] l s.c.R.

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556

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SUPREME COURT REPORTS

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We are in agreement with the view expressed by the High Court at Calcutta in the M. B. Sirkar case (supra) as to when an order on an application for amendment can become a judgment within the mean· ing of clause I 5 of the Letters Patent. If an amendment merely allows the plaintiff to state a new cause of action or to ask a new relief or to include a new ground ofreliefall that happens is that it is possible ror the plaintiff to raise further contentions in the suit, bnt it is not decided whether the contentions are right. Such an amendment does nothing m>re than regulate the procedure applicable to the suit. Il does not decide any question which touches tne merits of the controversy between the parties. Where, on the other hand, an amendment takes away from the defendant the defence of immunity from any liability by reason of limitation, it is a judgment within the meaning of clause 15 of the Letters Petcnt. The reason why it becomes a judgment is that it is a decision affecting the merits of the question between the parties by determining the right or liability based on limitation. It is the final decision as far as the trial court is concerned.

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In finding out whether the order is a judgment within the meauing of clause I 5 of the Letters Patent it has to be found out that the order affects the merits of the action between the parties by determining some right or liability. :rhe right or liability is to be found out by the court. The nature of the order will have to be examined in order to ascertain whether there has been a dermination of any right or liability.

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The appellant made an application in December, 1969 for amendment of the plaint to claim pension. Those amendments were disallowed by the learned Chamber Judge. Four months thereafter the appellant sought to amend the plaint by adding certain paragraphs and those amendments were in relation to the appellant's alleged claim for pension. The appellant submitted that the second application for amendment in regard rn the cial)n for amortised amount of damages in relation to pension was not the same as the first application. It was said on behalf of the appellant that if the learned Judge allowed the application the appeilate court should not have interfored with the discretionary order. The amendment order is not purely of discretion. Even with regard to discretionary orders the appellate court can interfere where the order is insupportable in law or is unjust. The High Cou°rt considered the second application for amendment to be a new claim based on the new set of facts which becnme barred on the date of the application for amendment. In exceptional cases an amendment has been allowed where the effect is to take away from a defondant a legal right which has accrued to him by laps~ of time, because the court found that consideration of lapse of ttme is out weighed by the special circumstan.ces of the. case. (See Charan Das v. Amir Khan 47 I.A. 255). The High Court nghtly found that there were no special circumstances to entitle the appellant to introduce by amendments such claim.

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For these reasons, the judgment of the High Court is upheld. The appeal is dismissed with costs.

Appeal dismissed.

V.P.S.

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