Gita Ram and others vs Balsaran Singh and others

Gurdev Singh, J.—This petition for revision is directed against the order of the Senior Subordinate Judge, Karnal, exercising the powers of the Court under the Provincial Insolvency Act made u/s 54 of the Provincial Insolvency Act, 1920, annulling the sale made by the insolvent Piara Singh on 30th November, 1961, in favour of the appellants Gita Ram, Deep Chand and Dia Chand. The learned Insolvency Judge has found that this sale was fraudulent and void as against the Official Receiver as it was intended to give preference to some of the creditors over others.

Besides opposing this petition for revision on merits and pointing out that Sardha Ram, who is the main creditor and was thus a necessary party had not been imp leaded in these proceedings, Mr. P.C. Khungar, appearing for the Official Receiver, has contended that no petition for revision lies to this Court as the impugned order was passed by a Subordinate Judge and an appeal against it lay to the Court of the District Judge. Reliance in this connection has been placed upon AIR 1937 247 (Oudh)

Though Mr. H.L. Sarin, appearing for the petitioner, started by saying that no appeal against the order of the Senior Subordinate Judge lay to the District Judge and thus the petitioner was within his rights in invoking the jurisdiction of this Court, on being faced with sub-section (1) of section 75 of the Provincial Insolvency Act, 1920 (hereinafter referred to as the Act), he conceded that the appeal against the order lay to the Court of the District Judge. He has, however, urged that despite the fact that the order was appeasable, his client was entitled to come up for its revision to this Court. After hearing the parties and adverting to the relevant provisions of law, I am of the opinion that the preliminary objection taken by Mr. Khungar must prevail.

The order against which the petitioner has come up in revision was admittedly made by the Senior Subordinate Judge exercising the powers of the Court under the Provincial Insolvency Act, u/s 54 of that Act. The provision for Appeals and revisions against orders passed, under the Provincial Insolvency Act is found in section 7o of the Act, which runs thus :

75(1) The Debtor, any creditor, the Receiver or any other person aggrieved by a decision some to or an order made in the exercise of insolvency jurisdiction by a Court subordinate to a District Court may appeal to the District Court, and the order of the District Court upon such appeal shall be final;

Provided that the High Court, for the purpose of satisfying; itself that an order made in any appeal decided by the District Court, was according to law may call for the case and pass such order with respect thereto as it thinks fit.

Provided further that any such person aggrieved by a decision of the District Court on appeal from a decision of a subordinate Court u/s 4 may appeal to the High Court on any of the grounds mentioned in sub-section (1) of section 100 of the Code of Civil Procedure, 1908.

(2) Any such person aggrieved by any such decision or order of a District Court as is specified in Schedule 1, come to or made otherwise than in appeal from an order made by a subordinate Court may appeal to the High Court.

(3) Any such person aggrieved by any other order made by a District Court otherwise than in appeal from an order made by a subordinate Court may appeal to the High Court by leave of the District Court or of the High Court.

(4) The period of limitation for appeals to the District Court and to the High Court under this section shall be thirty days and ninety days, respectively.

On perusal of sub-section (1) it is evident that an order made by the Senior Subordinate Judge in exercise of his Insolvency jurisdiction is appeasable to the Court of the District Judge. It is thus obvious that the petitioners had a right to question the correctness of the impugned order by way of appeal before the District Court. This remedy has not been availed of by them and no reason for this omission has been put forward before me. Thus, the short question which remains to be considered is whether the petitioners have a right to invoke the Revisional jurisdiction of this Court having failed to avail of the statutory remedy by way of appeal, which they had against the impugned order of the Senior Subordinate Judge under sub-section (1) of section 75. This petition for revision purports to have been made u/s 75 of the Provincial Insolvency Act. The provision for such a revision petition is to be found only in the first proviso to sub-section (1) of section 75, which lays dows that:

The High Court, for the purpose of satisfying itself that an order made in any appeal decided by the District Court, was according to law, may call for the case and pass such order with respect thereto as it thinks fit.

This proviso does not obviously apply to the petitioner''s case as the order against which they have come up in revision was not made by the District Judge on an appeal against the order of the subordinate Court but by a Court subordinate to the District Judge against which no appeal was preferred to the District Judge though it was competent. On perusal of section 75 of the Act, we find that except for the Revisional jurisdiction limited to the orders of the District Judge to which the first proviso of section 75, sub-section (I), refers, there is no revision provided under the Act against an order passed in insolvency proceedings. It thus follows that an order of a Court exercising insolvency jurisdiction subordinate to the District Court is not open to revision u/s 75 of the Act. Accordingly, the present petition, which purports to have been made u/s 75 of the Act, is clearly misconceived and does not lie under that Act.

Apart from the revisional jurisdiction which vests in the Court u/s 75 of the Act, the High Court, no doubt, possesses powers of Revision against the orders of the Courts subordinate to it u/s 115 of the Civil Procedure Code. Even if it be accepted for the sake of argument that despite the limited revisional jurisdiction referred to in section 75 of the Act, this Court can entertain a petition for revision against an order of an Insolvency Court u/s 115 of the Civil Procedure Code, we have still to consider whether such a petition for revision under the CPC lies, and if it does, whether this Court should interfere notwithstanding the fact that the petitioner has, for reasons best known to him, not availed of the remedy by way of appeal, which is more effective and exhaustive, available to him u/s 75(1) of the Act. Mr. P.C. Khungar has urged:

(1) that since there is a specific provision made in section 75 of the Act about the revisional jurisdiction of the High Court and the Provincial Insolvency Act is a complete Code in itself, it is only under this Act that the revisional jurisdiction can be exercised, and the general provision regarding revisional jurisdiction of the High Court u/s 115 of the CPC to correct the orders of the Subordinate Civil Courts cannot be resorted to;

(2) that even if it be conceded that a petition for revision against an order passed in insolvency jurisdiction by a Court subordinate to the District Judge lies u/s 115 of the Civil Procedure Code, no such petition can be entertained in view of the expression "in which no appeal lies thereto" that occurs in section 115 of the Civil Procedure Code;

(3) that, in any case, there is no justification for interference u/s 115 of the CPC when the petitioner has without any cause omitted to avail of the right of appeal that was available to him u/s 75 of the Provincial Insolvency Act; and

(4) that there being no failure to exercise jurisdiction or error or material irregularity in the exercise of jurisdiction, and the order being just, even u/s 115 of the CPC no case for interference of this Court has been made out.

Section 115 of the CPC is in these words:

The High Court may call for the record of any case which has been decided by any Court subordinate to such High Court and in which no appeal lies thereto, and if such subordinate Court appears -

(a) to have exercised a jurisdiction not vested in it by law, or

(b) to have failed to exercise a jurisdiction so vested, or

(c) to have acted in the exercise of its jurisdiction illegally or with material irregularity the High Court may make such order in the case as it thinks fit.

It is now well settled, as has been recently ruled by their Lordships of the Supreme Court in Major S.S. Khanna Vs. Brig. F.J. Dillon, that if an appeal against an order lies to the High Court, then no petition for its revision would be competent u/s 115. The expression "in which no appeal lies thereto" had presented a good deal of difficulty and led to divergent and conflicting views among the various High Courts. In one set of cases it has been ruled that this expression meant that it is only where the order in question is appeasable to the High Court directly that the jurisdiction of the High Court to interfere in revision is barred. In the other set of cases, where a contrary view was taken, it was held that even if the order was not directly appeasable to the High Court but it was appeasable in the first instance to the Court of the District Judge and only a second appeal lay to the High Court, the High Court would still be incompetent to entertain a petition for revision u/s 115 of the Civil Procedure Code. This conflict has, however, been set at rest by the decision of their Lordships of the Supreme Court in Major S.S. Khanna Vs. Brig. F.J. Dillon, Overruling the Full Bench decisions in Buddhoo Lal and Another Vs. Mewa Ram, and Purohit Swarupnarain Vs. Gopinath and Another, and some other decisions, their Lordships have held that it is not only in cases where an order is directly appeasable to the High Court but also in cases where a second appeal lies to it that the power of the High Court to interfere u/s 115 of the CPC is barred. Shah J., delivering the judgment of the Court, therein observed:

If an appeal lies against the adjudication directly to the High Court, or to another Court from the decision of which an appeal lies to the High Court, it has no power to exercise its revisional jurisdiction, but where the decision itself is not appeasable to the High Court directly or indirectly, exercise of the revisional jurisdiction by the High Court would not be deemed excluded. The judgment of the Rajasthan High Court in Swarupnarain v. Gopinath(supra) on which strong reliance was placed by the appellant does not, in our judgment, correctly interpret section 115 of the Code.

This dictum of their Lordships of the Supreme Court supports the view that a Full Bench of this Court had earlier taken in Custodian of Evacuee Property, New Delhi Vs. Nasir Uddin and Others, Shamsher Bahadur J., delivering the judgment of the Full Bench, in this connection observed :

It seems to us that the revisional jurisdiction of the High Court can be invoked only in cases in which no appeal at all lies thereto. It is plain that a case which can be taken either as first or second appeal to the High Court, is excluded from its revisional jurisdiction u/s 115. The words "in which" cannot and indeed are not intended to restrict to cases where an appeal can be preferred directly to the High Court.

There is thus no doubt that the settled position of law with regard to the competency of revision petitions u/s 115 of the CPC is that if in a case no first or second appeal lies to the High Court and the order is appeasable only to a subordinate Court, this Court is competent to entertain a petition for its revision The order against which the petitioner has come was, no doubt, appeasable to the Court of the District Judge but no farther appeal against that order lies to this Court. It is thus obvious that if it is held that section 116 of the CPC can be availed of to revise orders passed under the Insolvency Act, notwithstanding the specific provision contained in section 75 of that Act. this Court is competent to entertain the petition in exercise of its re visional jurisdiction under the Code of Civil Procedure.

It is, however, well settled that the power which the Court possesses to revise the orders of the subordinate Civil Courts u/s 115 of the CPC is entirely discretionary. It is intended to correct certain classes of errors of jurisdiction, to keep the Courts within the bounds of their jurisdiction, and to further the ends of justice. The revisional power u/s 115 of the CPC is not so wide, as this Court enjoys under the Provincial Insolvency Act. It cannot be disputed that acting u/s 115 of the Civil Procedure Code, the Court is not discharging the functions of an appellate Court and will not ordinarily interfere with findings of fact which are supported by some evidence or material on record.

In dealing with the exercise of jurisdiction u/s 116 of the Civil Procedure Code, we must not also be oblivious of another well-established rule of practice which is that if another remedy is open to the petitioner, this Court will not readily interfere u/s 115 of the Civil Procedure Code. The existence of another remedy is a circumstance which must weigh with the Court before it makes up its mind to interfere, and it is only in cases where the alternative remedy is found to be ineffective or could not be followed because of the circumstances beyond the control of the petitioner that the High Court will step in to prevent injustice and miscarriage of justice. In the case before us, as has been observed earlier, the order against which the petitioner has come up to this Court was appeasable u/s 75 of the Provincial Insolvency Act. It is not disclosed, and it is not even alleged, that there was any adequate reason for the petitioners not availing of that right of appeal. The remedy by way of appeal is always more effective than the relief of that can be afforded to a litigant in exercise of revisional jurisdiction, as appeal is a re-hearing of the matter, and the appellate Court, except where some limitation is imposed upon its powers by the statute itself, is competent to go into questions of fact as well as of law and reverse the findings on the questions of fact as well if they are not sustainable on the material available on record. It is, therefore, evident that the re-medy, which was available to the petitioner by way of appeal u/s 7 5 of the Provincial Insolvency Act, and which he has chosen not to avail of, was more effective than the one that he now seeks by invoking the revisional jurisdiction of this Court under Sec. 115 of the Code of Civil Procedure. The trial Court has found that the alienation in favor of the petitioners was fraudulent and made with a view to give them undue preference over other creditors. It is thus obvious that there is no equity in favour of the petitioners, even if one were to go by the considerations of equity rather than law.

Apart from this, the order under revision does not suffer from any defect of jurisdiction. From the grounds which have been taken by the petitioners in assailing that order, it is abundantly clear that they have challenged the correctness of the order on merits, and their contention that the evidence available to the Senior Subordinate Judge did not justify the conclusion that the sale in favour of the petitioners was fraudulent As has been said, a Court, which is validly seized of a matter, has the jurisdiction to decide it wrongly as well as rightly, and the mere tact that its decision on merits cannot be sustained does not lead to the conclusion that it suffers from any defect of jurisdiction T thus find that no case for interference in exercise of the revisional jurisdiction of this Court has been made out. This petition, as has been noticed earlier, purports to have been made u/s 75 of the Provincial Insolvency Act. The powers of this Court u/s il5 of the CPC have not been invoked, but even if the petitioner could come under this provision, no case for exercise of jurisdiction vesting in this Court u/s 115 of the CPC is made out. The mere fact that by this time the petitioner''s right of appeal to the Court of the District Judge has become time barred, does not entitle him to any indulgence. The right which accrues to a party on expiration of the period of limitation fixed by the statute is a valuable right, and it can be taken away only on grounds recognized by the Indian Limitation Act. Apart from this, if a litigant precludes himself from availing of the further remedy available to him under the law by sleeping over the matter or seeking a different kind of remedy which is not open to him, he does so at his own peril, and he is not entitled to any consideration from his Court.

For all these reasons, the petition for revision is dismissed with costs.