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Representative Suit - Process Under Order 1 Rule 8 CPC Not Mandatory At Appellate Stage : Kerala High Court

2 Jun 2021 10:13 AM GMT
Representative Suit - Process Under Order 1 Rule 8 CPC Not Mandatory At Appellate Stage : Kerala High Court

Answering a reference against a division bench judgment, a 3-judge bench of the Kerala High Court has held that the publication of notice under Order 1 Rule 8 of the Code of Civil Procedure is not mandatory at the appellate stage of a representative suit.

A 3-judge bench comprising Justices CT Ravikumar, V Shircy and K Haripal declared that the division bench judgment in Radha K.S. v. Sadasivan and another [2017 (1)KHC 118 : 2017 (1) KLT 102], which held that provisions of Order 1 Rule 8 CPC are to be complied with at the appellate stage, was "not correctly decided".

The question referred to the bench was :

"Is an appeal preferred against a decree passed in a representative suit incompetent, without making a further publication under sub-rule (2) of Rule 8 of Order I of the Code of Civil Procedure?"

The reference was made by a single bench which doubted the correctness of the decision in Radha K.S. v. Sadasivan and another. While the single bench referred the matter to a division bench, in 2017, a division bench endorsed the views of the single bench, and further referred the matter to a 3-judge bench, as Radha was a decision rendered by a coordinate bench.

Appeal a continuation of suit proceedings

The 3-judge bench noted at the outset that an appeal is a continuation of the original suit proceedings. An appeal being continuation of the suit and when the proceedings obtains the character of a representative suit, it is maintained throughout and it is not necessary to follow the procedure intermittently.

The bench also stated that the publication under Order 1 Rule 8 at every stage of proceedings is not a mandatory requirement and was discretionary.

The judgment authored by Justice K Haripal stated :

"Firstly, the very statement, it is a mandatory requirement, in our assessment, is an overstatement. There is no such mandate in the Code requiring the publication under Order I, Rule 8 CPC at every stage of the proceedings.

Secondly, a mandatory provision is one which has to be obeyed in its letter and spirit and anything done without such compliance stands vitiated. [See the decision reported in Bharat Hari Singhania and others v. Commissioner of Wealth Tax and others (AIR 1994SC 1355)]. Since there is no such provision in the Code, we cannot say that it is mandatory. Moreover, we have not come across any judicial pronouncement making such procedure imperative at every stage of the proceedings.

As correctly argued by the learned counsel for the respondents,when it is said that granting permission or issuing direction is a matter of discretion, it cannot be said to be mandatory. These two propositions cannot go together".

Highlighting the "intrinsic unity" of the proceedings under the CPC, the bench observed :

"The proceedings of the trial court at the threshold originates from a suit where parties, subject matter, cause of action, etc. are detailed. It is from the decree passed by the trial court that a cause of action for the appeal arises. The original proceedings, appeal and second appeal cannot be kept in watertight compartments.

An appeal being the continuation of the original proceedings, no fresh adjudication takes place. Appeal courts re-examine and re-assess the legality and correctness of the decree passed by the trial court. It can consider both the questions of law as well as facts. In the process, the vires of granting sanction or issuing direction under sub-rule (2) of Rule 8 of Order I CPC can be examined by the appellate court. All latent aspects can be raised before the appellate court. It can also be stated, having regard to the facts, that plaintiffs/defendants are not the proper persons to represent a common cause or a particular interest, that there is clash of interest among the parties, etc. Similarly, sufficiency of the attempt made by the trial court in publishing the notice also can be the subject matter of grievance in the appeal. In other words, no fresh adjudication takes place in appeal and what all matters already considered, in the light of the rival contentions and the findings thereon, are carried to the appellate court for exercise of its higher wisdom", the judgment observed.

Permission granted by trial court for representative suit will not expire after trial

The 3-judge rejected the argument that the permission granted by the trial court to sue or to be sued in representative capacity will expire after the trial and fresh permission is required for the next stage.

"The learned counsel for the appellants wanted to impress that on permission granted by the trial court, if publication is made before the trial court, its effect will expire at the termination of the trial court proceedings, is something against the very scheme of the Code. We are of the view that the proposition that the permission granted by the trial court or direction given, is ephemeral, cannot be approved.

As indicated earlier, class of representative actions are suits filed under Sections 91 and 92 CPC and one where publication is made under Rule 8 of Order I CPC. There cannot be any doubt that leave granted under Sections 91 and 92 CPC will sustain till the termination of the proceedings. In our considered view, the very same analogy is applicable in an action under Order I, Rule 8 CPC as well. If permission is granted or direction is issued, as the case may be under Order I,Rule 8 CPC, that proceedings will obtain the character of a representative action, once procedural formalities are complied.

A decree passed in such a suit is a representative decree which will hold the field until the termination of proceedings or unless reversed by a higher court. It is against the scheme of things to argue that such procedure has to be repeated intermittently for boosting up or intensifying the sanction once granted. It cannot be equated with an indigent proceedings to be followed at every stage. In other words,once the procedure under Order I, Rule 8 is complied, that would change the very character of the suit; once the character of the suit is obtained, it will be maintained throughout unless interfered with and changed by the hierarchy of the courts"

Single Bench can doubt correctness of Division Bench judgment in exceptional circumstances

The 3-judge also observed that the single bench cannot be faulted for making a reference against a division bench judgment.

Referring to the Supreme Court decision in Pradip Chandra Parija and others v. Pramod Chandra Patnaik and others [(2002) 1 SCC 1], the 3-judge bench observed that the Supreme Court "has left a small window open to a single Judge or Benches of lesser strength, if the Judge or Judges find that in no circumstance the Division Bench decision be followed, the option is to refer the matter to be decided by a Division Bench".

It was also noted that the division bench too endorsed the doubts expressed by the single bench.

"From the order of the learned Single Judge dated 06.04.2017, it is very patent that the learned Judge was trekking very cautiously, fully conscious of the limitation in doubting the correctness of an earlier Division Bench decision. The learned Judge has also cited the decision in Kallara Sukumaran, cited supra. Standing within the narrow contour and fully conscious of the limitation in doubting the correctness of a Division Bench ruling, the learned single Judge was placing the entire matter before the Hon'ble the Chief Justice", the bench noted.

The Court heard Shri.P.B. Krishnan, counsel for the appellants, Sri. Ranjith Thampan, Additional Advocate General,assisted by Sri. M.A. Johnson and Smt. Deepa Narayanan, Government Pleaders, Sri. Chelur Sreekumar and Sri. Mahesh Ramakrishnan, counsel appearing for the party respondents and also Sri. Vinod Bhat, Amicus Curiae.

Click here to read/download the judgment (Case : M V Narayanan vs Periyadan Narayanan Nair)

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