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CASE NO.: Appeal (civil)  1036 of 2002

PETITIONER: Kashmir Singh

RESPONDENT: Harnam Singh & Anr

DATE OF JUDGMENT: 03/03/2008

BENCH: Dr. ARIJIT PASAYAT & P. SATHASIVAM & AFTAB ALAM

JUDGMENT: J U D G M E N T

CIVIL APPEAL NO. 1036 OF 2002

Dr. ARIJIT PASAYAT, J.  

1.      Challenge in this appeal is to the judgment of a learned  Single Judge of the Punjab and Haryana High Court allowing  the Second Appeal filed by respondent No.1.  The Second  Appeal was filed under Section 100 of the Code of Civil  Procedure, 1908 (in short the ’Code’). Though many points  were urged in support of the appeal it was primarily submitted  that no substantial question of law was formulated and  Second appeal would not have been allowed without  formulating any such question.           2.      In view of Section 100 of the Code the memorandum of  appeal shall precisely state substantial question or questions  of law involved in the appeal as required under sub-section (3)  of Section 100. Where the High Court is satisfied that in any  case any substantial question of law is involved it shall  formulate that question under sub-section (4) and the second  appeal has to be heard on the question so formulated as  stated in sub-section (5) of Section 100.  

3.      Section 100 of the Code deals with "Second Appeal". The  provision reads as follows:

"Section 100- (1)       Save as otherwise  expressly provided in the body of this Code or  by any other law for the time being in force, an  appeal shall lie to the High Court from every  decree passed in appeal by any Court  subordinate to the High Court, if the High  Court is satisfied that the case involves a  substantial question of law.

(2)     An appeal may lie under this section from  an appellate decree passed ex parte.

(3)     In an appeal under this Section, the  memorandum of appeal shall precisely state  the substantial question of law involved in the  appeal.

(4)     Where the High Court is satisfied that a  substantial question of law is involved in any  case, it shall formulate that question.

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(5)     The appeal shall be heard on the question  so formulated and the respondent shall, at the  hearing of the appeal, be allowed to argue that  the case does not involve such question:          Provided that nothing in this sub-section  shall be deemed to take away or abridge the  power of the Court to hear, for reasons to be  recorded, the appeal on any other substantial  question of law, not formulated by it, if it is  satisfied that the case involves such question."

4.      A perusal of the impugned judgment passed by the High  Court does not show that any substantial question of law has  been formulated or that the second appeal was heard on the  question, if any, so formulated. That being so, the judgment  cannot be maintained.           5.      In Ishwar Dass Jain v. Sohan Lal (2000 (1) SCC 434) this  Court in para 10, has stated thus:

"10. Now under Section 100, after the 1976  Amendment, it is essential for the High Court  to formulate a substantial question of law and  it is not permissible to reverse the judgment of  the first appellate Court without doing so."

6.      Yet again in Roop Singh v. Ram Singh (2000 (3) SCC 708)  this Court has expressed that the jurisdiction of a High Court  is confined to appeals involving substantial question of law.  Para 7 of the said judgment reads:

"7. It is to be reiterated that under section 100   jurisdiction of the High Court to entertain a  second appeal is confined only to such appeals  which involve a substantial question of law  and it does not confer any jurisdiction on the  High Court to interfere with pure questions of  fact while exercising its jurisdiction under  section 100. That apart, at the time of  disposing of the matter the High Court did not  even notice the question of law formulated by  it at the time of admission of the second  appeal as there is no reference of it in the  impugned judgment.  Further, the fact findings  courts after appreciating the evidence held  that the defendant entered into the possession  of the premises as a batai, that is to say, as a  tenant and his possession was permissive and  there was no pleading or proof as to when it  became adverse and hostile. These findings  recorded by the two courts below were based  on proper appreciation of evidence and the  material on record and there was no  perversity, illegality or irregularity in those  findings. If the defendant got the possession of  suit land as a lessee or under a batai  agreement then from the permissive  possession it is for him to establish by cogent  and convincing evidence to show hostile  animus and possession adverse to the  knowledge of the real owner. Mere possession

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for a long time does not result in converting  permissive possession into adverse possession  (Thakur Kishan Singh v. Arvind Kumar (1994  (6) SCC 591). Hence the High Court ought not  to have interfered with the findings of fact  recorded by both the courts below."

                                7.      The position has been reiterated in Kanahaiyalal and  Ors. v. Anupkumar and Ors. (JT 2002 (10) SC 98)

8.      After the amendment, a second appeal can be filed only if  a substantial question of law is involved in the case.  The  memorandum of appeal must precisely state the substantial  question of law involved and the High Court is obliged to  satisfy itself regarding the existence of such a question.  If  satisfied, the High Court has to formulate the substantial  question of law involved in the case.  The appeal is required to  be heard on the question so formulated.  However, the  respondent at the time of hearing of the appeal has a right to  argue that the case in the court did not involve any  substantial question of law.  The proviso to the section  acknowledges the powers of the High Court to hear the appeal  on a substantial point of law, though not formulated by it with  the object of ensuring that no injustice is done to the litigant  where such a question was not formulated at the time of  admission either by mistake or by inadvertence.

9.      It has been noted time and again that without insisting  for the statement of such a substantial question of law in the  memorandum of appeal and formulating the same at the time  of admission, the High Courts have been issuing notices and  generally deciding the second appeals without adhering to the  procedure prescribed under Section 100 of the Code.  It has  further been found in a number of cases that no efforts are  made to distinguish between a question of law and a  substantial question of law.  In exercise of the powers under  this section in several cases, the findings of fact of the first  appellate court are found to have been disturbed.  It has to be  kept in mind that the right of appeal is neither a natural nor  an inherent right attached to the litigation.  Being a  substantive statutory right, it has to be regulated in  accordance with law in force at the relevant time.  The  conditions mentioned in the section must be strictly fulfilled  before a second appeal can be maintained and no court has  the power to add or to enlarge those grounds.  The second  appeal cannot be decided on merely equitable grounds.  The  concurrent findings of facts will not be disturbed by the High  Court in exercise of the powers under this section. Further, a  substantial question of law has to be distinguished from a  substantial question of fact.  This Court in Sir Chunilal V.  Mehta and Sons Ltd. v. Century  Spg. & Mfg. Co. Ltd. (AIR  1962 SC 1314) held that :

"The proper test for determining whether a  question of law raised in the case is substantial  would, in our opinion, be whether it is of general  public importance or whether it directly and  substantially affects the rights of the parties and  if so whether it is either an open question in the  sense that it is not finally settled by this Court or  by the Privy Council or by the Federal Court or is  not free from difficulty or calls for discussion of  alternative views.  If the question is settled by the  highest court or the general principles to be

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applied in determining the question are well  settled and there is a mere question of applying  those principles or that the plea raised is  palpably absurd the question would not be a  substantial question of law."

10.     It is not within the domain of the High Court to  investigate the grounds on which the findings were arrived at,  by the last court of fact, being the first appellate court.  It is  true that the lower appellate court should not ordinarily reject  witnesses accepted by the trial court in respect of credibility  but even where it has rejected the witnesses accepted by the  trial court, the same is no ground for interference in second  appeal when it is found that the appellate court has given  satisfactory reasons for doing so.  In a case where from a given  set of circumstances two inferences of fact are possible, one  drawn by the lower appellate court will not be interfered by the  High Court in second appeal.  Adopting any other approach is  not permissible.  The High Court will, however, interfere where  it is found that the conclusions drawn by the lower appellate  court were erroneous being contrary to the mandatory  provisions of law applicable or its settled position on the basis  of pronouncements made by the Apex Court, or was based  upon inadmissible evidence or arrived at by ignoring material  evidence.          11.     The question of law raised will not be considered as a  substantial question of law, if it stands already decided by a  larger Bench of the High Court concerned or by the Privy  Council or by the Federal Court or by the Supreme Court.  Where the facts required for a point of law have not been  pleaded, a litigant should not be allowed to raise that question  as a substantial question of law in second appeal.  Mere  appreciation of facts, the documentary evidence or the  meaning of entries and the contents of the documents cannot  be held to be raising a substantial question of law.  But where  it is found that the first appellate court has assumed  jurisdiction which did not vest in it, the same can be  adjudicated in the second appeal, treating it as a substantial  question of law.  Where the first appellate court is shown to  have exercised its discretion in a judicial manner, it cannot be  termed to be an error either of law or of procedure requiring  interference in second appeal.  This Court in Reserve Bank of  India v. Ramkrishna Govind Morey (1976 (1) SCC 803) held  that whether the trial court should not have exercised its  jurisdiction differently is not a question of law justifying  interference.([See: Kondiba Dogadu Kadam v. Savitribai Sopan  Gujar and Others (1999(3) SCC 722)].          12.     The phrase "substantial question of law", as occurring in  the amended Section 100 is not defined in the Code.  The word  substantial, as qualifying "question of law", means \026 of having  substance, essential, real, of sound worth, important or  considerable. It is to be understood as something in  contradistinction with \026 technical, of no substance or  consequence, or academic merely.  However, it is clear that the  legislature has chosen not to qualify the scope of "substantial  question of law" by suffixing the words "of general importance"  as has been done in many other provisions such as Article  133(1)(a) of the Constitution.  The substantial question of law  on which a second appeal shall be heard need not necessarily  be a substantial question of law of general importance.  In  Guran Ditta v. T. Ram Ditta (AIR 1928 PC 172), the phrase  ’substantial question of law’ as it was employed in the last  clause of the then existing Section 100 (since omitted by the

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Amendment Act, 1973) came up for consideration and their  Lordships held that it did not mean a substantial question of  general importance but a substantial question of law which  was involved in the case. In Sri Chunilal’s case (supra), the  Constitution Bench expressed agreement with the following  view taken by a full Bench of the Madras High Court in  Rimmalapudi Subba Rao v. Noony Veeraju (AIR 1951 Mad.  969):

"When a question of law is fairly arguable, where  there is room for difference of opinion on it or  where the Court thought it necessary to deal with  that question at some length and discuss  alternative views, then the question would be a  substantial question of law.  On the other hand if  the question was practically covered by the  decision of the highest court or if the general  principles to be applied in determining the  question are well settled and the only question  was of applying those principles to the particular  facts of the case it would not be a substantial  question of law."

13.     This Court laid down the following test as proper test, for  determining whether a question of law raised in the case is  substantial as quoted in Sir Chunilal’s case (supra).          14.     In Dy. Commnr. Hardoi v. Rama Krishna Narain (AIR  1953 SC 521) also it was held that a question of law of  importance to the parties was a substantial question of law  entitling the appellant to a certificate under (the then) Section  100 of the CPC.

15.     To be "substantial" a question of law must be debatable,  not previously settled by law of the land or a binding  precedent, and must have a material bearing on the decision  of the case, if answered either way, insofar as the rights of the  parties before it are concerned. To be a question of law   "involving in the case" there must be first a foundation for it  laid in the pleadings and the question should emerge from the  sustainable findings of fact arrived at by court of facts and it  must be necessary to decide that question of law for a just and  proper decision of the case.  An entirely new point raised for  the first time before the High Court is not a question involved  in the case unless it goes to the root of the matter.  It will,  therefore, depend on the facts and circumstance of each case  whether a question of law is a substantial one and involved in  the case, or not; the paramount overall consideration being  the need for striking a judicious balance between the  indispensable obligation to do justice at all stages and  impelling necessity of avoiding prolongation in the life of any  lis. (See :Santosh Hazari v. Purushottam Tiwari (deceased) by  Lrs. [(2001) 3 SCC 179].

16.     The principles relating to Section 100, relevant for this  case, may be summarized thus:- (i)     An inference of fact from the recitals or contents of  a document is a question of fact. But the legal effect  of the terms of a document is a question of law.  Construction of a document involving the  application of any principle of law, is also a question  of law. Therefore, when there is misconstruction of a  document or wrong application of a principle of law  in construing a document, it gives rise to a question  of law.

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(ii)    The High Court should be satisfied that the case  involves a substantial question of law, and not a  mere question of law. A question of law having a  material bearing on the decision of the case (that is,  a question, answer to which affects the rights of  parties to the suit) will be a substantial question of  law, if it is not covered by any specific provisions of  law or settled legal principle emerging from binding  precedents, and, involves a debatable legal issue. A  substantial question of law will also arise in a  contrary situation, where the legal position is clear,  either on account of express provisions of law or  binding precedents, but the court below has decided  the matter, either ignoring or acting contrary to  such legal principle. In the second type of cases, the  substantial question of law arises not because the  law is still debatable, but because the decision  rendered on a material question, violates the settled  position of law.   17.     The general rule is that High Court will not interfere with  concurrent findings of the Courts below. But it is not an  absolute rule. Some of the well recognized exceptions are  where (i) the courts below have ignored material evidence or  acted on no evidence; (ii) the courts have drawn wrong  inferences from proved facts by applying the law erroneously;  or (iii) the courts have wrongly cast the burden of proof. When  we refer to ’decision based on no evidence’, it not only refers to  cases where there is a total dearth of evidence, but also refers  to any case, where the evidence, taken as a whole, is not  reasonably capable of supporting the finding.          18.     In view of the aforesaid position, we set aside the  impugned judgment of the High Court and remit the matter to  it for fresh consideration.  The Second Appeal can be only  maintained after formulating substantial question of law, if  any and not otherwise.  We make it clear we have not  expressed any opinion on the question as to whether any  substantial question of law is involved or not.

19.     The appeal is allowed to the aforesaid extent without any  order as to costs.