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PETITIONER: SHANTI KUMAR R. CANJI

       Vs.

RESPONDENT: THE HOME INSURANCE CO.  OF NEW YORK

DATE OF JUDGMENT24/07/1974

BENCH: RAY, A.N. (CJ) BENCH: RAY, A.N. (CJ) MATHEW, KUTTYIL KURIEN

CITATION:  1974 AIR 1719            1975 SCR  (1) 550  1974 SCC  (2) 387  CITATOR INFO :  RF         1981 SC1786  (107,116,139,152)

ACT: Letters  Patent of the Bombay High Court, Cl.  15--Judgment, what is

HEADNOTE: 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 alia that  the  alleged claim was barred by limitation  in  1970. The  trial Court allowed the amendment, but in appeal  under Cl. 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. In  appeal  to this Court, it was contended  that:  (1)  the order  of the trial Court was not a judgment and  hence  not appealable   under  Cl.  15,  and  (2)  the  order   was   a discretionary order and the appellate Court should not  have interfered with the exercise of discretion. Dismissing the appeal, 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 proceeding so far  as the  Court  dealing with it is concerned; and  (b)  it  must involve the determination of some right or liability  though it may not be necessary that there must be a decision on the merits. [554 B] In 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 determining 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 all that happens

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is  that it is possible for the plaintiff to  raise  further contentions  in the suit, but it is not decided 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 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 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 respondent 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 we’re 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, Tuliaram v. Alagappa 1. L. R. 35 Mad.  J., M. B. Sirkar & Sons v. Powell & Co. A.I.R. 1956.  Cal.  630, approved. . Charan Das v. Amir Khan 47 1. A. 255 referred to. Dayabhai  v.  Murugappa Chettiar I. L. R. 13 Rang.  457  and Manohar v. Bailram I.L. R. 1952 Nag. 471, overruled. 551 For  the  appellant: On the first point, an  order  allowing amendment  is not a "Judgment" within the meaning of  clause 15  of the Letters Patent.  Divergent views have been  taken by   various  High,  Courts  as  to  the  meaning  of   word "Judgment".   This question came before this Court  also  in the  case  of  ’Asrumati  devi’ (1953)  SCR  II  59-where  a question arose whether an order for transfer of a suit under clause 13 of the Letters Patent (Calcutta High Court) is not a "Judgment" within the meaning of clause 15 of the  Letters Patent;  and this Court took the view that an order of  this character  could not be regarded as a ’Judgment’ but it  did not determine the true meaning and scope of the word  "Judg- ment",  nor  did it resolve a wide  divergence  of  judicial opinion on the subject.  An order to be a ’Judgment’ in  Cl. 15 of the Letters Patent must either determine some right or liability  which  is  in  controversy  in  the  suit  either partially or wholly; or it should terminate the  proceedings even without deciding any right or liability in controversy. Any  wider definition of the word ’Judgment’ will  make  all orders   appealable   irrespective  of  their   nature   and irrespective of the proceeding in which they are passed.  An interim order which does not determine 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, is not  a  ’judgment’. An  order  allowing  the  amendment  does  not  decide   any substantive right or liability.  It only permits a claim  to be  agitated and does not decide the claim  and,  therefore, the order of the single judge was not appealable. Justice of the Peace for Calcutta v. The Oriental Gas Co. 8 Bengal L.R. 433, Tuljaram v. Alagappa Chelter- I.L.R. 35 Mad.,  I;I.L.R.

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Rang. 457 and I.L.R. [1952] Nag. 471 (F.B.) referred to. On  the  second point, it is settled law that  an  appellate Court  will not interfere with such an order passed  by  the trial Court in exercise of its discretion without  exceeding the  limits,  of its power, unless it  acted  perversely  or unless the view taken by it is clearly wrong.  The amendment sought  for  became necessary as on the true and  full  dis- closure  of  the terms of Pension Rules, the  Appellant  was found to be entitled to damages in lieu of pension. The  principle of res judicata did not apply as the  earlier order  of  the  Single Judge allowing  the  first  amendment application partly on 19-1-1970 did not deal with the  claim for mortised damage now sought to be added. For  the Respondent: There is no need to go into the  larger question  because judged by the tests laid down by  all  the High Courts including the Nagpur High Court, the decision of the trial Court in the instant case allowing the  amendment, is  a judgment within the meaning of Cl. 15 of  the  Letters Patent.  By reason of the amendment of the plaint, the claim made  in  the amended plaint dates back to the date  of  the plaint.   The application for amendment was filed in  April, 1970  and  by that time, the claim for pension  was  clearly barred  by limitation.  By allowing 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 amendment is allowed raise the plea of  limitation. There is a clear negation of valuable right of 552 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  Bom. 361; AIR 1972 Bombay 27 ; 1967 (2) M.L.J. (FB) referred to. 35  Madras at p. 9 lays down the law that the fact that  the order  is  one allowing the amendment, is not  decisive  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 less 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. By  allowing the amendment, the right is conferred upon  the plaintiff   and  it  carries  with  it  the   fastening   of liabilities upon the defendants. The  decision  on a vital points adverse  to  the  defendant which goes to the root of the matter and which becomes final and conclusive, so far as the court passing of the order  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.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1991 of 1971. 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. Agarwal for the respondent. 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. 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. In  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. On  16  December,  1969 the appellant  took  out  a  Chamber Summons   for  amendment  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. 553 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. 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. By  summons  dated 27 April, 1970 the  appellant  sought  an amendment  of. the plaint claiming Rs. 68,000 as damages  in relation to his right to pension.  By an order dated 6 July, 1970 the appellant was allowed to amend the plaint as prayed for. The respondent preferred an appeal against the order dated 6 July, 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. 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 the meaning of clause 15  of  the Letters  Patent.   Secondly,  it  was  said  that  an  order allowing   the   amendment  was   a   discretionary   cider. Therefore,  the appellate court should not  have  interfered with the discretion. 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. The  locus  classics is the decision of the  High  Court  of Calcutta  in Justice of the Peace for Calcutta  v.  Oriental Gas Company 8 Bengal L.R. 433 where Sir Richard Couch, C. J. said  "We  think  that ’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  preliminary  or  interlocutory   judgment determines  only a part of it, leaving other matters  to  be determined." 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

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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 554 controversy  between  the  parties in the  suit  itself  nor terminates or disposes of the suit on any ground. 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 Tuljaram v. Alagappa I.L.R. 35  Mad.  1. 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 High Court said  "if  the effect is to put an end to the suit or proceeding so far  as the Court 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. 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 of  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   that description and an order transferring the suit 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 come 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. 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 there is  a 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 Debi’s  case (supra) described the order refusing to rescind leave to  be 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. The present appeal concerns an application for amendment  of the  plaint.   The  suit was filed in the  year  1964.   The application for amendment of the plaint in regard to damages for  the  right to pension was made in the  year  1970.   An amendment, if allowed’, would relate 555 to the date of the institution of the suit.  The  respondent

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contended   before   the  trial   Court   entertaining   the application  for amendment of the plaint that the  amendment should  not  be allowed inter alia on the  ground  that  the alleged claim was barred by limitation in 1970. The High Court in the present case relied on the decision of the High Court at Calcutta in M.B. Sarkar & Sons v. Powell & Co.  A.I.R.  1956 Cal. 630.  In that case an  amendment  was allowed  on  Chambers Summons substituting in place  of  the original defendant which was described as a firm a defendant converted  into  a  company in that name.   The  company  so proposed  to  be substituted complained that  the  amendment took  away from it a valuable right which had accrued to  it by efflux of time, and, therefore, the amendment should  not be  allowed.   The  contention  of  the  defendant  was  not accepted  by the learned Chamber Judge.  The High  Court  on appeal set aside the order.  It was not held to be a case of mis-description  of the defendant.  A mis-description  of  a party impleaded can arise when the party really intended  to be  impleaded  had always been the same and  such  intention appeared clearly from the body of the plaint in spite of the inaccurate  mis-description in the cause title.  In  such  a case,  it would not be adding a new party or substituting  a new party for the original one, but perfecting the  identity of the party originally impleaded clearing or rectifying the inaccurate  description.  When the same person,  whether  an individual or a legal entity, remains the defendant but only the name is altered, it would be a case of  mis-description. Where a new legal entity is substituted, it was held in  the M. B. Sarkar case (supra) that substitution of a company for a  firm  would  be  a  change  of  a  substantial  character affecting the right of a party.  The effect of the amendment in  the  M. B. Sarkar case (supra) was to substitute  a  new party for the party originally impleaded and the consequence was  to  take  away from the new party  so  substituted  his defence of limitation that a suit brought on the date of the amendment  would be barred by time.  Chakravartti,  C.J.  in the  M.  B.  Sirkar  case (supra) said  that  an  order  for amendment  of  the  plaint there decided  a  vital  question concerning  the  merits of the case and the  rights  of  the newly impleaded party and therefore became a judgment within the meaning of clause 15 of the Letters Patent. 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 conferred upon 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 means 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. The  views  of the High Courts at Calcutta and  Madras  with regard  to  the  meaning  of  ’judgment’  are  with  respect preferred to the meaning of ’judgment’ given by the  Rangoon and Nagpur High Courts. 556 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  with  in the meaning of clause 15 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

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include  a new ground of relief all that happens is that  it is  possible for the plaintiff to raise farther  contentions in  the suit, but it is not decided whether the  contentions are  right.   Such  an  amendment  does  nothing  more  than regulate  the procedure applicable to the suit. it does  not decide  any  question  which  touches  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 clause 15  of  the  Letters Patent.  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. In  finding out whether the order is a judgment  within  the meaning  of  clause 15 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. The 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  determination  of  any right or liability. 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 to the claim for a mortised  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  appellate court  should  not have interfered  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 Court considered the  second  application for  amendment  to be a new claim based on the  new  set  of facts which became 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 defendant  a legal  right  which  has accrued to him by  lapse  of  time, because the court found that consideration of lapse of  time is  out  weighed by the special circumstances of  the  case. (See  Charan Das v. Amir Khan 47 I.A. 255).  The High  Court rightly  found that there were no special  circumstances  to entitle the appellant to introduce by amendments such claim. For these reasons, the judgment of the High Court is upheld. The appeal is dismissed with costs. V.P.S. Appeal dismissed. 557