AI Structured Summary
Not yet generated for this judgment
Judgment
ORDER
Oral Judgment : Justice Sharad Kumar Sharma, Member (Judicial):
The Appellant in the instant Company Appeal (AT) (CH) (INS) No. 293 / 2024, puts a challenge to the Impugned Order dated 21.03.2024, as it has been rendered by the NCLT, Hyderabad Bench in IA(IBC)/512/2021.
There are various aspects, which have been argued by the learned counsel for the appellant, contending thereof that, the decision which had been taken on IA(IBC)/512/2021, would amount to be an adjudication of a lis on merits and hence it would fall to be within the ambit of definition of ``decision’’ which would make it appealable under Section 61 of the I & B Code, 2016.
The relevant part of the Impugned Order is extracted hereunder:-
``IA (IBC) 512/2021
This is an application filed by liquidator for multiple reliefs and some of the reliefs are common in this IA and IA No. 452/2022, which is already disposed of and accordingly some of the relief of this IA are adjudicated in IA No. 452/2022. In view of this IA is also disposed of with a liberty to the liquidator to file a fresh application for the remaining reliefs if any. Accordingly, this application is disposed of.’’
On a simpliciter reading of the Impugned Order, it is seen that when the NCLT was comparing with the set of reliefs which were sought for in the two Interim Relief Applications i.e. IA/452/2022 which, has already been decided and the instant interlocutory application, which was being considered i.e. IA(IBC)/512/2021, it had found that, there were certain reliefs which were prayed for in IA(IBC)/512/2021, which earlier already stood adjudicated, while deciding IA/452/2022 and hence, it left it open for the Appellant to approach before the NCLT, by way of filing an appropriate fresh application for the remaining reliefs, which were earlier either were not granted or were not considered by the learned Adjudicating Authority.
This Impugned Order, which leaves it open for the appellant to approach the learned NCLT, afresh by filing of an application, for remaining reliefs, in view of the fact that certain reliefs already stood granted, will not amount to be a ``decision’’, which could make the Appeal maintainable under Section 61 of the I & B Code, 2016, because, as far as the word ``decision’’ is concerned, it has been held by the Hon’ble Apex Court that, a ``decision’’ by a Court would amount to be deciding an issue and will have to be in the form of a definite opinion which would have an effect of affecting the rights of the parties in dispute. The said proposition has been laid down and considered in the Judgments Viz. P.L. Lakhanpal v. Union of India, 1966 SCC OnLine SC 90, United India Insurance Co. Ltd. v. Ajay Sinha, (2008) 7 SCC 454 Para 25 and Tirumalachetti Rajaram v. Tirumalachetti Radhakrsihnayya Chetty, AIR 1961 SC 1795 and also in a Judgment as decided way back in 1930 as reported in Chung Chuck v. Rex, AIR 1930 PC 291. The relevant paragraphs of the said Judgments are extracted hereunder:
This extract is taken from P.L. Lakhanpal v. Union of India, 1966 SCC OnLine SC 90;
“8.The question then is : what precisely does the word “decide” in Rule 30-A mean? It is no doubt a popular and not a technical word. According to its dictionary meaning “to decide” means “settle (question, issue, dispute) by giving victory to one side; give judgment (between, for, in favour of, against); bring, come, to a resolution” and “decision” means “settlement, (of question etc.), conclusion, formal judgment, making up ones mind, resolve, resoluteness, decided character”. As Fazl Ali, J., in Province of Bombay v. Advani [1950 SCC 551 : (1950) SCR 621 at 642] observed:
“The word ‘decision’ in common parlance is more or less a neutral expression and it can be used with reference to purely executive acts as well as judicial orders. The mere fact that an executive authority has to decide something does not make the decision judicial. It is the manner in which the decision has to be arrived at which makes the difference and the real test is : Is there any duty to decide judicially?” In that case the question was whether the decision of the Bombay Government under Section 3 of the Bombay Land Requisition Ordinance, V of 1947 that a property was required for a public purpose was a quasi judicial act and a writ of certiorari would lie against such a decision. The majority held that it was an administrative act but it is noteworthy that Mukherjea, J., who differed along with Mahajan, J. (as he then was) was of the view that the question whether a public purpose exists or not had to be determined under that section by the Government of Bombay as there was a lis or a controversy between the interest of the public on the one hand and that of the individual who owned the property on the other and the determination of the Government was a judicial act such determination being a collateral matter on which the jurisdiction to reqisition was founded and not a part of the executive act of requisitioning. We are however not called upon in the present case to decide whether the function of review and the decision which may be made by the Government is a judicial or a quasi-judicial function or not. Indeed, the petitioner has not raised any such question whether the order of the 11th June, 1966 was a judicial or a quasi-judicial one. We do not therefore propose to examine the relevant provisions of the Rules from that point of view. The question raised by the petitioner before us is whether the validity of the decision depends upon the existence of relevant circumstances which would necessitate the continuation of detention and whether such circumstances on which it is founded are demonstrable. As tersely put by Lord Atkin in his famous dissent in Liversidge v. Anderson [(1942) AC 206] is the decision one of a case of thinking that a person has a broken ankle and not a case of his really having a broken ankle or as Mahajan J. (as he then was) put it in Advani case at p. 659 of the Report:
“Similarly can it be said that Section 4 contemplates merely a vacancy in the mind of the Government, not a vacancy in fact as a real thing.” If the decision is to be founded on a mere subjective satisfaction or opinion it would be in the former category but if it is to be founded on a fact it has to fall in the latter category and in that event it would have to be regarded as one based on an objective test. It follows that where the exercise of power is not conditioned on a mere opinion or satisfaction but on the existence of a set of facts or circumstances that power can be exercised where they exist. The authority in such a case is required to exercise the power in the manner and within the limits authorised by the legislature. The existence of such facts which is the determinant for the exercise of the power is demonstrable.”
This extract is taken from United India Insurance Co. Ltd. v. Ajay Sinha, (2008) 7 SCC 454;
“25.Chapter VI-A stands independently. Whereas the heading of the Chapter talks of pre-litigation, conciliation and settlement, Section 22-C(8) of the Act speaks of determination. It creates another adjudicatory authority, the decision of which by a legal fiction would be a decision of a civil court. It has the right to decide a case. The term “decide” means to determine; to form a definite opinion; to render judgment. (See Advanced Law Lexicon, 3rd Edn., 2005 at p. 1253.) Any award made by the Permanent Lok Adalat is executable as a decree. No appeal thereagainst shall lie. The decision of the Permanent Lok Adalat is final and binding on the parties. Whereas on the one hand, keeping in view the parliamentary intent, settlement of all disputes through negotiation, conciliation, mediation, Lok Adalat and judicial settlement are required to be encouraged, it is equally well settled that where the jurisdiction of a court is sought to be taken away, the statutory provisions deserve strict construction. A balance is thus required to be struck. A court of law can be created under a statute. It must have the requisite infrastructure therefor. Independence and impartiality of Tribunal being a part of human right is required to be taken into consideration for construction of such a provision. When a court is created, the incumbents must be eligible to determine the lis.”
This extract is taken from Chung Chuck v. Rex, AIR 1930 PC 291 at page 296;
“28.To sum up: (1) Although the word “decision” standing merely by itself might be sufficient to cover a decision either in a civil or in a criminal case, the word does not stand by itself, but is in an Order in Council containing a number of other provisions working out the procedure; (2) the Order in Council itself recites that it is passed for the promotion of uniformity in practice and procedure of all such appeals, and one would not expect to find it conferring new rights of appeal when it only purports to deal with practice and procedure in appeals; (3) the way in which S. 2 is drafted first of all in (a), where it merely relates to civil cases, and in (b), where it says that there is an appeal at the discretion of the Court from any other judgment, again points to the fact that 2(b) is simply referring to the same class of case as 2(a), namely to civil cases and not to criminal cases.”
This extract is taken from Tirumalachetti Rajaram v. Tirumalachetti Radhakrishnayya Chetty, AIR 1961 SC 1795;
“7.The next question to consider is : what is the denotation of the word “decision” used in the said clause. The argument for the respondent is that the word “decision” does not mean the whole of the decision but the decision on that part of the controversy between the parties which is brought to this Court in appeal. In support of the argument that the decision does not mean the entire decision of the trial court reliance is placed on the provisions of Order 20 Rules 4 and 5. Rule 4 of Order 20 deals with the judgments of Small Cause Courts and judgments of other courts, and it provides that the judgments falling under the first clause need not contain more than the points for determination and the decision thereon, whereas the judgments falling under the latter class should contain a concise statement of the case, the points for determination, the decision thereon and the reasons for such decision. There is no doubt that the decision in the context means the decision on the points for determination. That of course is the meaning of the word “decision”, but whether or not the word “decision” means the decision on one point or the decision of the whole suit comprising of all the points in dispute between the parties must inevitably depend upon the context, and the context is plainly inconsistent with the argument that the decision should mean the decision on a specific point. If the word “decree” in the first part of the relevant clause means not a part of the decree but the whole of the decree then it would be reasonable to hold that the word “decision” must likewise mean the entire decision of the trial court and not a part of it.
9.The question as to the meaning of the word “decision” in the corresponding provision of the Code of 1882 (Section 596) was considered by the Privy Council in Rajah Tasadduq Rasul Khan v. Manik Chand [(1902-03) 30 IA 35] . The question which arose for the decision of the Privy Council was whether the appellate decree in that case was one of affirmance or not. The appellate decree had confirmed the trial court's decision though on different grounds, and so it was urged that the appellate decree was not one of affirmance. In rejecting this argument the Privy Council stated that
“the natural, obvious and prima facie meaning of the word ‘decision’ is decision of the suit by the court, and that that meaning should be given to it in the section” (596). The Privy Council examined the definition of the word “judgment” in the Code of 1882 and came to the conclusion that the word “decision” meant the decision of the suit by the trial court and not the grounds stated in support of the said decision; in the result it was held that the appellate decree which confirmed the decision of the trial court though on different grounds was in law a decree of affirmance. It would thus be seen that this decision undoubtedly supports the conclusion that the word “decision” in Article 133(1) should mean not a part of the decision or the grounds given for it but the decision of the suit as a whole; and if that be so, the clause could be harmoniously construed to mean that in determining the character of the appellate decree we have to look at the appellate decree as a whole, compare it with the decision of the trial court as a whole and decide whether the appellate decree is one of affirmance or not. In this enquiry the nature of the variation made whether it is in favour of the intending appellant or otherwise would not be relevant.”
The Judgment rendered by the Hon’ble Apex Court as reported in AIR 1961 SC Page 1795 (as extracted above), has specifically laid down that, a part of the decision or an order which is passed during the course of the proceedings, will not on all occasions form to be a decision itself, because, under the normal connotation when the implications of an Appeal or an appellate order is to be taken into consideration, there has had to be a ``decision’’ taken on merits which has an effect of affecting the right of a party. If the decision taken is not recording any definite opinion expressed by the learned Tribunal, based on the facts, then there is no ``adjudication’’ of rights between the competing claims on merits. In such a case, it will not be appealable order before an Appellate Jurisdiction, as it has been held by the Hon’ble Apex Court in James Joseph v. State of Kerala, (2010) 9 SCC 642.
“10.Section 12-A does not use the words “second appeal”. It provides that an appeal would lie against an appellate order under Section 11 to the High Court. The word “appeal” is not defined either under the Act or under the Code. Black's Law Dictionary (7th Edn.) defines an appeal as:
“A proceeding undertaken to have a decision reconsidered by bringing it to a higher authority;”
11.The classic definition of an appeal in Chappan v. Moidin Kutti [ILR (1899) 22 Mad 68] , by a Full Bench of the Madras High Court, adopted by this Court, in Tirupati Balaji Developers (P) Ltd. v. State of Bihar [(2004) 5 SCC 1] , is as follows: (Tirupati Balaji case [(2004) 5 SCC 1] , SCC pp. 14-15, paras 9-10)
“9.… Appeal implies in its natural and ordinary meaning the removal of a cause from any inferior court or tribunal to a superior one for the purpose of testing the soundness of decision and proceedings of the inferior court or tribunal. The superior forum shall have jurisdiction to reverse, confirm, annul or modify the decree or order of the forum appealed against and in the event of a remand the lower forum shall have to rehear the matter and comply with such directions as may accompany the order of remand. The appellate jurisdiction inherently carries with it a power to issue corrective directions binding on the forum below….
10.… An appeal is a process of civil law origin and removes a cause, entirely subjecting the facts as well as the law, to a review and a retrial.”
Looking to the provisions of Section 61 of I & B Code, 2016, though it uses the expression that ``any person aggrieved by the ``Order’’ of the learned Adjudicating Authority’’ under this part may prefer an appeal to NCLAT’’, this Tribunal is of the view that, the term ``Order’’, used in the said provision may not be misconstrued to be understood as if, it means and can be stretched to mean any order passed by the learned Adjudicating Authority, because the expression `Order’’, used herein under Section 61 of the I & B Code, 2016, has to be read in context of the definition of ``Appeal’’, as discussed in the aforesaid judgment, and has to be construed to be an order which records a definite opinion on an issue, including an interlocutory order, which has an element of adjudication on merits, deciding the right of the party or affecting the rights of the parties. It will follow that an order passed during the course of proceeding, which does not attach finality of a right and does not decide the lis or any part of lis on merits, will not be amenable to appeal under Section 61. In other words, the term ``Order’’, as used under Sec. 61, has to be rationally read as to be a ``decision’’ taken on merits even if it is for part of a claim, and not any order which is passed by learned NCLT / Adjudicating Authority, during the course of the proceedings, before it.
What would the word `decision’ denote in its literal sense could be derived from a latin term `ratio decidendi’ which means a rational for decision. In fact, the said term implies that, there has to be a final adjudication referring to the key factual points or the chain of reasons, which facilitates a Judge to apply his mind to derive a final Judgment on an issue, which has been raised before him, affecting rights of the parties or any decision on merits of a claim.
It is from the aforesaid term of `ratio decidendi’ that, the term ``decision’’ has to be read in circumstances of a particular context of as to what the term `decidendi’ means. According to Law Lexicon VI Edition as published by Mr. P. Ramanatha Aiyar, it literally means a definite or drawing a definite opinion to render Judgment, to give a Judgment for or against a party to a suit or a proceeding. In other words, it could be said, that it is a determination upon the question in controversy or a cause of dispute.
This Tribunal is of the opinion that, the term decision, means to decide, is to render a Judgment on an issue of fact and law on the basis of assessment of the relevant facts and weighing the evidence in relation to pros and cons, employing the process of rationality as laid down in law and then rationally arriving at a conclusion to decide a right, ``To decide’’ herein does not imply that, the Court will arrive at a mere inference. It would rather mean that the Court has to express a definite opinion and the reasons, on the basis of the material produced before it, on the question of either admitting or rejecting of pleas, which has been reduced in writing before it for adjudication.
In context thereto, if the determination of word `decidendi’ as it has been extracted above, is to be made applicable to infer as to what the decision would mean, it would mean that, it signifies a Judgment of a Court or a Tribunal which is competent under law to record its finding upon which a decree or a conclusion could be arrived at for laying the dispute or even a part of dispute at rest.
In other words, it amounts to the result of deliberation of a Tribunal / Court, unless otherwise is qualified by law by the context before it, leading to a decision bringing the finality to a dispute between the parties. The dispute in this context, need not be merely the principal dispute; it can be even, orders on stay of proceedings, on impleadment of a new party, on production of additional evidence, on any interim arrangement to be made during pendency of the principal dispute and henceforth. Accordingly, the word ``decision’’, as discussed above should not be misunderstood to infer that, any decision which is taken by the learned Adjudicating Authority or a Court, for that matter, on an application filed before it, during the course of the proceedings without a decision being rendered on the principal matter on merits, cannot be appealed against, as long as the dispute which is agitated in the application has been brought to a finality.
The expression ``decision’’ in the context of filing of an appeal against such decision will mean a judgment or an order that, is arrived at by a Court competent to do so after application of mind and upon consideration of evidence and particularly the said decision has to have an element which attaches a finality to the dispute in question.
It may be noted that, all decisions by an authority, are not always and cannot be always amount to be an adjudication of a right and such decisions are also referred to be as an ``Order’’.
In the instant case, the appellate provision as contained under Section 61 of the I & B Code, 2016, uses the word ``Order’’. The use of word ``Order’’ under an Appellate provision will have to mean a decision, which is distinct and significantly of much difference in its implication, from the meaning of order as it has been used under a normal connotation. In fact, the Hon’ble Apex Court in a judgment reported in AIR 1954 SC 520 Sree Sai Co-operative Housing Society Limited, has observed that as against every order, the same may not be appealable, under an Appellate Jurisdiction, though, the appellate provision might have been using the word `order’.
The term `decision’ or an `order’ under the Appellate provision will have to be backed up by an element of an adjudication, which is a legal process of resolving a dispute even in part if need be and which is judicially reckoned as to be a process contemplated under law of an adjudication in favour of the natural rights by legal process resolving a dispute i.e. a formal expression or pronouncing of a Judgment or a Decree in a Court, where a right is adjudicated between the parties.
In the context of Section 61 of I & B Code, 2016, where appeal is contemplated against an ``order of the learned Adjudicating Authority’’, it has to be rationally construed that, every order which is passed during the course of the proceedings, which is not attaching a finality to or bringing an end to the litigation or even a part of it, will not amount to be an adjudication nor a decision finally taken on a lis and in that eventuality even if the appellate provision uses the word `order’, it will always denote to a final decision to be taken on the issue and not otherwise.
In these eventualities in the instant case, where the right of the Appellant has not at all been affected and rather it is still left open to be decided on merits upon an application to be filed by him afresh as directed, in compliance of the Impugned Order which is under challenge in this Appeal and particularly when all his grievances, have not been decided on merits yet, and are still be open to be considered by the learned Tribunal, on its own merits, appeal filed against such order is not maintainable.
The Appellant ultimately, at the stage of conclusion of argument, has expressed an apprehension that, while the discretion was exercised by the learned Adjudicating Authority in its order, by leaving it open for the Appellant to file an appropriate application before the learned Adjudicating Authority for the remaining reliefs does not prejudice his rights, he submits that initiating a new process often consumes a lot of time and it may result in delaying the decisions, which he is seeking for. In order to suitably address the said apprehensions expressed by the learned Counsel for the Appellant, though without any material on record, but still in order to balance the equities, if the Appellant approaches before the learned NCLAT, within a period of 2 weeks from the date of receipt of Certified Copy of this Judgment, by filing of an appropriate application in compliance of the Impugned Order under challenge in relation to IA(IBC)/512/2021, the learned NCLT is requested to make all efforts to decide the aforesaid application on its own merit, within one month thereafter.
Subject to the above, the Company Appeal (AT) (CH) (INS) No. 293 / 2024 stand dismissed. The urgent listing Application IA No. 769 / 2024, would too stand disposed of. The connected all pending Interlocutory Applications, if any, would stand closed.