REPORTABLE  

  IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 309 OF 2003

Malayalam Plantations Ltd.       .... Appellant (s)

Versus

State of Kerala & Anr.             .... Respondent(s)

WITH

CIVIL APPEAL NO. 310 OF 2003

J U D G M E N T  

P. Sathasivam, J.

1) These appeals are directed against the judgment and  

decree  dated  31.05.2002  passed  by  the  High  Court  of  

Kerala at Ernakulam in MFA No. 537 of 1995 and Cross  

Appeal whereby the High Court modified the order dated  

13.03.1979 of the Forest Tribunal, Kozhikode.  Malayalam  

Plantations Ltd. has filed C.A. No. 309 of 2003 and the  

State of Kerala preferred C.A. No. 310 of 2003.  Since both  

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the  appeals  arise  from  the  common  order  of  the  High  

Court,  they  are  being  disposed  of  by  this  common  

judgment.   For  convenience,  we  shall  refer  Malayalam  

Plantations Ltd. as appellant and the State of Kerala as  

Respondent.

Brief facts:

2) (a) The appellant is a Limited Company, which owns 5  

estates in South Wayanad Taluk in Kerala.   It  engaged  

principally  in  the  cultivation  of  Tea,  Coffee,  Cocoa,  

Rubber,  Cardamom and Cinnamon.  The Kerala Private  

Forests  (Vesting  and Assignment)  Act,  1971 (hereinafter  

referred to as ‘the Act’) came into force with 10.05.1971 as  

the  appointed  day  providing  for  vesting  of  all  private  

forests in the State of Kerala.  An area of 5131 hectares of  

land  which  was  in  the  possession  of  the  appellant’s  

Wayanad Estates in Wayanad District of Kerala State was  

deemed to be vested under the said Act.   

(b)  The appellant filed five applications being OA Nos. 3,  

4,  5,  6  and  26  of  1975  before  the  Forest  Tribunal,  

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Kozhikode in respect of its 5 Wayanad Estates challenging  

the  vesting  of  2588  hectares  out  of  the  5131  hectares  

which  were  either  planted  with  eucalyptus  by  the  

appellant  prior  to  the  vesting  or  were  utilized  for  the  

purpose of fuel requirement for its factory and for the use  

of its employees.  No application was filed for the balance  

2543 hectares as it formed part of the forest and finally  

vested with the Government.   

(c)   By  a  common  order  dated  13.03.1979,  the  Forest  

Tribunal,  Kozhikode  exempted  the  entire  2588  hectares  

from the vesting provisions of the Act.   

(d)   Aggrieved  by  the  order  of  the  Forest  Tribunal,  the  

State of Kerala filed appeals being MFA Nos. 264-268 of  

1979 before the High Court of Kerala.  The appellant also  

filed appeals being MFA Nos.  209-214 of  1979 claiming  

that  exemption  was  granted  only  on  the  ground  of  

estoppel on account of collection of land tax for the areas  

involved even after the vesting and other grounds urged  

was not accepted by the Tribunal.   

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(e)  A Full Bench of the High Court, by its judgment dated  

29.09.1980,  while  allowing  the  appeals  filed  by  the  

Government  thereby  reversing  the  order  passed  by  the  

Tribunal  upheld  the  exemption  for  the  roads  and  

buildings.   

(f)  Challenging the order of the Full Bench, the appellant  

filed 5 Appeals  being C.A.  Nos.  557-561 of  1981 before  

this Court.  The State Government also preferred appeals  

being  Civil  Appeal  Nos.  1214-1218  of  1981.   By  a  

judgment  dated  24.08.1992,  this  Court  set  aside  the  

judgment of the Kerala High Court and remanded the O.A.  

Nos.  3,  4,  5,  6 and 26 of  1975 to the Forest  Tribunal,  

Kozhikode with a direction to determine and exempt the  

extent of land required by the appellant for the purpose of  

growing trees for fuel requirement i.e. firewood purposes  

for its factory as well as for the employees working in the  

estates.

(g)   The  Tribunal,  after  hearing  both  the  parties,  by  a  

common  judgment  dated  15.12.1994,  exempted  and  

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excluded  1400  hectares  of  land  from  the  vesting  

provisions  of  the  Act  as  areas  required  for  firewood  

purposes.   

(h)  When the appellant was pursuing with the authorities  

for implementing the order of the Tribunal,  the State of  

Kerala filed MFA No. 537 of 1995 before the High Court,  

challenging the judgment dated 15.12.1994 passed by the  

Forest  Tribunal,  Kozhikode.   On  02.07.1995,  a  Cross  

Appeal was filed by the appellant in the above said appeal  

of the Government.   

(i)  A Division Bench of the High Court of Kerala, by its  

impugned judgment  dated 31.05.2002 exempted 730.58  

hectares of eucalyptus lands from vesting but held that no  

forest areas could be exempted for the purpose of firewood  

in view of the decision of this Court in  State of Kerala  

and Another vs.  Pullengode Rubber Produce Co. Ltd.  

(1999) 6 SCC 92 holding that such areas should not be  

considered for exemption in the absence of proof that they  

were actually used in 1971.  The Government’s appeal was  

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partially  allowed  and  the  appellant’s  Cross  Appeal  

claiming the whole area was dismissed.  Since the Cross  

Appeal filed by the appellant is dismissed and appeal filed  

by the State was allowed by the Division Bench by the  

impugned  judgment,  both  the  appellant  and  the  State  

Government have filed the above appeals.

(3) Heard Mr. L. Nageswara Rao, learned senior counsel  

for  the  Malayalam  Plantations  Ltd  and  Mr.  Jayadeep  

Gupta, learned senior counsel for the State of Kerala.

(4)  Mr. L.N. Rao, after taking us through earlier remand  

order of this Court dated 24.08.1992 and the impugned  

judgment of the High Court dated 31.05.2002 submitted  

that the High Court erred in not appreciating the fact that  

the  remand  order  dated  24.08.1992  only  required  the  

Tribunal  to  ascertain  the  area  for  the  purpose  of  

exemption commensurate with the area of plantation and  

fuel requirement of the appellant as on 10.05.1971.  He  

also pointed out that the High Court was not justified in  

reducing the limit of the exempted land to 730.58 hectares  

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only on the basis of the decision in  Pullengode Rubber  

Produce (supra).  According to him, it has no application  

to the facts of the appellant’s case.  On the other hand,  

Mr.  Gupta,  learned  senior  counsel  for  the  State  by  

drawing our attention to various materials in the form of  

oral and documentary evidence submitted that the High  

Court was not justified in granting exemption of 730.58  

hectares of land in favour of the appellant Company.  He  

also pointed out that though the State Government has  

filed  separate  application  for  reception  of  material  

documents  as  additional  evidence  by  filing  application  

under Order 41 Rule 27, Code of Civil Procedure (in short  

‘CPC’),  the  High  Court  while  deciding  the  Regular  First  

Appeal failed to consider the same though adverted to in  

the course of discussion.

5)  Before considering the additional materials sought to  

be  produced  at  the  appellate  stage,  namely,  before  the  

High  Court,  by  the  State  as  well  as  Malayalam  

Plantations, it  is useful to refer the previous decision of  

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this  Court  in  Pioneer  Rubber  Plantation,  Nilambur,  

Kerala State vs.  State of Kerala & Anr. (1992) 4 SCC  

175.  This  Court,  after  adverting  to  the  definition  of  

‘private forests’ contained in clause (f) of Section 2 of the  

Act and the claim of both the parties remanded the matter  

with the following conclusion:-

“14. The entire purpose of exclusion of the items set out in  the foregoing paragraph from the scope of the definition of  ‘private  forest’  seems  to  be  not  to  hinder  or  create  any  difficulty  in  the  functioning  of  plantations  of  tea,  coffee,  cocoa,  rubber,  cardamom  and  cinnamon  as  viable  commercial enterprises. In these circumstances, it appears  reasonable that the minimum area required for the purpose  of growing firewood trees for fuel in the factories and smoke- houses as well as for supply to the employees of the estates  for their domestic use should be excluded from the definition  of  the  term ‘private  forest’.  We must,  however,  emphasize  that the burden is on the appellants to show that it has been  their  practice  to  supply  firewood  to  the  employees  of  the  estates for their domestic use. As for the firewood required  for  the  factories  and  smoke-houses  in  the  estates,  there  seems to be no doubt about the claim of the appellants. 15. However,  where  evidence  had  been  led  to  show  that  firewood was steadily and adequately available in the market  at reasonable rates for use of the factories or smoke-houses  as  well  as  for  supply  to  the  workers  of  a  particular  plantation, in such a case no land could be excluded from  the definition of the private forest on the ground that it was  required for growing firewood trees  for the purpose of  the  estate as well as for the workers. That, however, is not the  position in the case before us. On the pleadings and evidence  before us, we do not consider that any further inquiry on the  point is necessary. 16. In our view, Section 2(f)(1)(i)(B) should be so understood  as to grant exemption in respect of lands on which firewood  trees  are  necessary  to  be  grown  for  steady  supply  of  a  reasonable quantity of fuel to the employees as well as to the  smoke-houses or factories in the estates. In the absence of  

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satisfactory evidence to show that firewood is adequately and  steadily available in the market at reasonable prices, such  lands,  in  our  view,  qualify  for  exemption  under  Section  2(f)(1)(i)(B)  of  the  Act  as  “lands  used  for  any  purpose  ancillary  to  the  cultivation  of  such  crops  or  for  the  preparation of the same for the market”. This principle, in  our view, must hold good in relation to all crops mentioned  under  the  aforesaid  provision.  The  Tribunal  shall  merely  ascertain as to what is the minimum reasonable area of land  required for growing firewood trees to be used as fuel in the  factories or smoke-houses and for supply to the employees  for their domestic purposes, if such supply to the latter is  proved,  and  to  exclude  such  area  in  demarcating  private  forest. 17. What  exactly  is  the  area  which  can  be  reasonably  regarded  as  required  for  growing  firewood  trees  for  the  aforesaid  purposes  so  as  to  qualify  for  exemption  from  vesting under the Act is a question of fact which has to be  determined with reference to various factors. Some of these  factors are mentioned by the larger Bench of the High Court  in the following words: “32. The next point is what area of the jungle land could be  excluded  on  the  above  basis?  A  precise  assessment  will  almost  be  impossible,  because  the  quantum  of  firewood  needed for smoking purposes will depend on the volume of  rubber to be processed, the yield of the trees, the quality of  the wood and other factors. The best solution seems to be to  make an approximate assessment as was made by the Taluk  Land Board in Ammad case.” 18. We do not express any final view as to what factors are  relevant in determining the reasonable area that qualifies for  exemption  under  Section  2(f)(1)(i)(B)  of  the  Act.  That  is  a  matter for consideration by the concerned forest tribunals. 19. In the circumstances, the judgments of the Kerala High  Court impugned in these appeals are set aside and the cases  are  remanded to  the  appropriate  forest  tribunals:  namely,  the Forest Tribunal, Manjeri with respect to Civil Appeal Nos.  106-107 of 1982; the Forest Tribunal, Palghat with respect  to Civil Appeal No. 2050 of 1981; and the Forest Tribunal,  Calicut with respect to Civil Appeal Nos. 557-61 and 1214- 18 of 1981. The Tribunals shall determine the extent of the  lands required, as aforesaid, for fuel for the smoke-houses or  factories as well as for the employees in the estates.”

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6)  In view of the directions in the remand order, we are of  

the view that the High Court is not justified in relying on  

the earlier decision of this Court in Pullengode Rubber  

Produce (supra).   As rightly pointed by Mr. Rao that  

after the order of remand with a specific direction, the  

same has no application to  the  facts  of  the present  

case.  To this extent, we clarify the same.

7)  It is not in dispute that when the appeals of the State  

as  well  as  of  the  Malayalam  Plantations  were  pending  

before the High Court,  the State filed CMP No. 8793 of  

2001 for  accepting  Annexures  A1 to  A21 in  support  of  

their claim stating that at the relevant time, the Company  

is in possession of an extent of 1199.3579 hectares of land  

other  than  plantation  for  ancillary  purposes   In  the  

counter  affidavit  filed  by  the  Plantations  Company,  the  

Company put forth their case and produced Annexure R1  

in support of their stand claiming more extent of land for  

the use of their employees.

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8)   Mr.  Gupta,  learned senior  counsel  for  the  State  by  

taking us through the various documents filed in the said  

CMP demonstrated that if we consider the contents of the  

same, the entire claim of the Malayalam Plantations is to  

be rejected.  He further submitted that in view of the fact  

that Order 41 Rule 27 of CPC enables the parties to place  

documents  in  support  of  their  claim  as  additional  

evidence,  the  High  Court  though  adverted  to  did  not  

consider the same and no order was passed in the said  

CMP No. 8793 of 2001.  Mr. Rao pointed out that if this  

Court scrutinizes each and every document, the claim of  

the State is  to be rejected in toto and the stand of the  

appellant is to be accepted.   

9)   We  are  not  inclined  to  go  into  the  validity  or  

acceptability of those documents/materials filed by both  

sides  before  the  High  Court.   Order  41  of  CPC speaks  

about  procedure  in  respect  of  disposal  of  appeals  from  

original decree.  Among various rules, we are concerned  

about Rule 27 which reads as under:-

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“27. Production of additional evidence in Appellate Court.—(a) The  parties to an appeal shall  not be entitled to produce additional  evidence,  whether  oral  or  documentary,  in the Appellate  Court.  But if—

(a)  the  Court  from  whose  decree  the  appeal  is  preferred  has  refused to admit evidence which ought to have been admitted, or

(aa) the party seeking to produce additional evidence, establishes  that notwithstanding the exercise of due diligence, such evidence  was not within his knowledge or could not, after the exercise of  due diligence, be produced by him at the time when the decree  appealed against was passed, or

(b) the Appellate Court requires any document to be produced or  any witness to be examined to enable it to pronounce judgment, or  for any other substantial cause,  

the Appellate Court may allow such evidence or document to be  produced, or witness to be examined.

(2)  Wherever additional evidence is allowed to be produced by an  Appellate  Court,  the  Court  shall  record  the  reason  for  its  admission. “   

10)  In view of the above provision, in our opinion, when  

an application for reception of additional evidence under  

Order 41 Rule 27 of CPC was filed by the parties, it was  

the  duty  of  the  High  Court  to  deal  with  the  same  on  

merits.  The above principle has been reiterated by this  

Court  in  Jatinder Singh & Anr. Vs.  Mehar Singh &  

Ors. AIR 2009 SC 354 and  Shyam Gopal Bindal and  

Others vs.  Land  Acquisition  Officer  and  Another,  

(2010) 2 SCC 316.

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11)  If any petition is filed under Order 41 Rule 27 in an  

appeal, it is incumbent on the part of the appellate Court  

to consider at the time of hearing the appeal on merits so  

as to find out whether the documents or evidence sought  

to be adduced have any relevance/bearing in the issues  

involved.  It is trite to observe that under Order 41, Rule  

27,  additional  evidence could be adduced in one of  the  

three situations, namely, (a) whether the trial Court has  

illegally  refused the  evidence  although it  ought  to  have  

been  permitted;  (b)  whether  the  evidence  sought  to  be  

adduced by the party was not available to it despite the  

exercise of due diligence; (c) whether additional evidence  

was necessary in order to enable the Appellate Court to  

pronounce the judgment or any other substantial cause of  

similar  nature.   It is  equally well-settled that additional  

evidence cannot be permitted to be adduced so as to fill in  

the lacunae or to patch up the weak points in the case.   

12)   Adducing  additional  evidence  is  in  the  interest  of  

justice.   Evidence  relating  to  subsequent  happening  or  

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events  which  are  relevant  for  disposal  of  the  appeal,  

however, it is not open to any party, at the stage of appeal,  

to make fresh allegations and call upon the other side to  

admit or deny the same.  Any such attempt is contrary to  

the requirements of Order 41 Rule 27 of CPC.  Additional  

evidence  cannot  be  permitted  at  the  Appellate  stage  in  

order  to  enable  other  party  to  remove  certain  lacunae  

present in that case.   

13)   In the light of  the separate application filed under  

Order  41  Rule  27  of  CPC  for  reception  of  additional  

evidence by both sides, it is for the High Court to consider  

and  take  a  decision  one  way  or  other  as  to  the  

applicability  of  the  same  and  decide  the  appeal  with  

reference  to  the  said  conclusion.   In  this  view  of  the  

matter,  we  refrain  from  going  into  the  merits  of  the  

materials placed by both sides and it is for the High Court  

to consider and take a decision one way or other as per  

the mandate of the said provision.

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14)  For the reasons aforesaid, the impugned judgment of  

the High Court is set aside.  We make it clear that we have  

not  gone  into  the  merits  as  to  whether  application  for  

reception of additional evidence under Order 41 Rule 27 of  

the CPC should be allowed or not, which shall be decided  

by the High Court in accordance with law.  We also make  

it clear that we have not gone into the merits of the claim  

made by both parties except the reasons indicated in the  

earlier  paragraphs.   Considering  the  facts  and  

circumstances of the case, more particularly, the issue is  

pending from 1975, we request the High Court to restore  

MFA No. 537 of  1995 and Cross Appeal  on its  file  and  

dispose of the same at an early date preferably within a  

period of six months from the date of receipt of copy of  

this  judgment.   Civil  Appeals  are  allowed to  the  extent  

indicated above, however, with no order as to costs.

...…………………………………J.                   (P. SATHASIVAM)  

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...…………………………………J.           (Dr. B.S. CHAUHAN)  

NEW DELHI; NOVEMBER 9, 2010.

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