Appellant Has Right To Withdraw Appeal Without Any Strings Attached, High Court Must Grant Leave When Requested: Telangana High Court

The Division Bench of Justice Moushumi Bhattacharya and Justice M.G.Priyadarsini held, that the power of the High Court in granting permission to withdraw an appeal under Order XXIII Rule 1(3) of the Code of Civil Procedure (CPC) is very limited.

It was held that the High Court does not have the authority to refuse such withdrawal or impose conditions, particularly in the absence of a cross-objection filed by the respondent. The only requirement is for the court to be satisfied that the respondent has not acquired any right or interest in the subject matter of the dispute that would be affected by the appeal's withdrawal. The High Court's sole discretion in this matter is limited to imposing terms for granting permission to withdraw the appeal. It was held that:

“In essence, the power of the High Court in the matter of granting permission to withdraw an appeal under Order XXIII Rule 1(3) of the C.P.C is very limited; in fact the High Court does not have any power to refuse such withdrawal or put conditions to the withdrawal in the absence of a Cross-Objection filed by the respondent. The High Court must however be satisfied that the respondent has not become entitled to a right or interest in the subject matter of the dispute which would be affected if the appeal is withdrawn. The only power retained by the High Court is to impose terms for the permission to withdraw the appeal under the said provision of the C.P.C.”

Background:

The appellants, who were the plaintiffs in the original suit, had been declared owners of the disputed properties by the trial court. They had filed an appeal challenging the part of the judgment that dismissed their claim against a bank (respondent No. 1 in the appeal).

The respondents objected to the withdrawal.

The appellants argued for their right to withdraw the appeal, citing a settlement reached with the bank. They had paid the outstanding loan amount and received a no-dues certificate from the bank. The bank supported the appellants' position, relying on the settlement and the condition that the appeal be withdrawn.

On the other hand, the opposing respondents (respondent Nos. 2-4) vehemently objected to the withdrawal. They contended that they were not given notice of the settlement between the appellants and the bank, despite claiming a right over the properties. They also referred to pending proceedings before the Debt Recovery Tribunal and argued that an open market sale of the mortgaged property would have fetched a higher price.

The court, after considering the arguments, relied on established legal principles and previous Supreme Court decisions passed in Bijhayananda Patnaik v. Satrughna Sahu, Kalyan Singh v. Rahmu and Kanhaya Lal v. Pratap Chand to note that the respondents had not filed any cross-objections to the trial court's judgment, which had already declared the appellants as

absolute owners of the properties.

The Bench emphasized that without a cross-objection, the respondents had no legal standing to object to the appeal's withdrawal.

Thus, the withdrawal was permitted.

I.A.Nos.1, 2 and 3 of 2024 IN/AND A.S.No.25 of 2006

Sri Kantilal vs. Indian Overseas Bank, Rep by the Senior Manager,

Counsel for petitioner: M PAPA REDDY

Counsel for respondent: DISHIT BHATTACHARJEE