A two-judge Bench of Justice MR Shah and Justice AS Bopanna has held that the First Appellate Court must deal with all the issues and evidence led by the parties before recording its findings as per the procedure laid down in Civil Procedure Code (CPC).
Appeal was preferred before the Supreme Court against the judgment of the Madras High Court which had decreed the suit for specific performance of the contract based on an affidavit filed before it by the Respondent-Plaintiff.
In this case, Plaintiff had instituted a suit against the Defendant in the Trial Court for specific performance of the contract. However; the suit was dismissed on the ground that the Plaintiff had not shown his readiness and willingness to purchase the property with the tenants. In the First Appeal before the High Court, the Plaintiff filed an affidavit stating his readiness to purchase the property with the tenants. The High Cout accepted the same without re-appriciating the evidence on record or framing points for determination. The Defendant filed an Appeal before the Supreme Court.
The Appellant before the Supreme Court contended that the High Court as a First Appellate Court did not exercise the jurisdiction vested in it while considering the Appeal under Section 96 read with Order XLI Rule 31 of CPC.
It was argued that the High Court did not re-appreciate the evidence on record and even without raising the points for determination based on the issues which were framed by the learned Trial Court, the High Court had allowed the appeal and had decreed the suit for specific performance, which otherwise was not permissible.
The following observations were made by the Apex Court after perusing the impugned judgment of the High Court –
1) The High Court did not raise the points of determination as required under Order XLI Rule 31 CPC.
2) High Court as the First Appellate Court did not discuss the entire matter and issues in detail and did not re-appreciate evidence while disposing of the first appeal.
3) High Court disposed of the appeal under Order XLI CPC read with Section 96 in the most casual and perfunctory manner.
4) High Court did not exercise its powers vested in it as a First Appellate Court.
"As observed above, the High Court has neither re-appreciated the entire evidence on record nor has given any specific findings on the issues which were even raised before the learned Trial Court," the Court opined.
While referring to several precedents, the Court held, "Applying the law laid down by this Court in the aforesaid decisions, if the impugned judgment and order passed by the High Court is considered, in that case, there is a total non-compliance of the provisions of the Order XLI Rule 31 CPC. The High Court has failed to exercise the jurisdiction vested in it as a First Appellate Court; the High Court has not at all re-appreciated the entire evidence on record; and not even considered the reasoning given by the learned Trial Court, in particular, on findings recorded by the learned Trial Court on the issue of willingness."
The Bench was of the opinion that the procedure adopted by the High Court to reach its decision based on the affidavit filed by Plaintiff was untenable and unknown to law. "The affidavit, which was filed by the plaintiff and which has been relied upon by the High Court is just contrary to the pleadings in the plaint."
"The proper procedure would have been for the plaintiff to move a proper application for amendment of the plaint in exercise of the power under Order VI Rule 17 CPC, if at all it would have been permissible in a first appeal under Section 96 read with Order XLI CPC. However, straightaway to rely upon the affidavit without amending the plaint and the pleadings is wholly impermissible under the law. Therefore, such a procedure adopted by the High Court is disapproved," the Court asserted.
In light of these observations, the Court allowed the appeals thereby setting aside and quashing the judgment of the High Court and restored the judgment and decree of the Trial Court. The Court ordered the Appellant-Defendant to refund the amount of Rs.3,60,001/- with 18% interest to the Respondent-Plaintiff within eight weeks.