Letters Patent Appeal Not Maintainable Against Orders Which Does Not Have Traits And Trappings Of Finality: Supreme Court

The Supreme Court observed that a Letters Patent Appeal cannot be entertained against orders which does not have the traits and trappings of finality.

An order of single judge, though may cause some inconvenience to one of the parties or, to some extent, some prejudice to one of the parties, cannot be treated as a 'judgment' under clause 15 of Letters Patent of the Calcutta High Court, the bench comprising Justices L. Nageswara Rao and B R Gavai observed.

In this case, the Division Bench of the Calcutta High Court entertained and finally allowed a Letters Patent appeal against a Single Judge order which, in a suit for infringement of trade mark and passing off, only directed the defendants to file affidavit­ in ­opposition and postponed the hearing of the application seeking injunction.

Before the Apex Court, the appellant-defendants contended that the order passed by the Single Judge could not be construed to be a 'judgment' within the meaning of Clause 15 of the Letters Patent of the High Court (hereinafter referred to as "Letters Patent") and as such, the appeal itself was not maintainable. On the other hand, the plaintiff- respondents, contended that since a vital and valuable right of the plaintiffs was infringed by non ­grant of ad ­interim order by the  Single Judge, the appeal was very much tenable. Both sides relied on the judgment in Shah Babulal Khimji v. Jayaben D. Kania and Another (1981) 4 SCC 8.

Referring to Shah Babulal (Supra), the bench observed thus:

It could thus be seen that both the judgments of Justice S. Murtaza Fazal Ali as well as Justice A.N. Sen have a common thread that, as to whether an order impugned would be a 'judgment' within the scope of Clause 15 of Letters Patent, would depend on facts and circumstances of each case. However, for such an order to be construed as a 'judgment', it must have the traits and trappings of finality. To come within the ambit of 'judgment', such an order must affect vital and valuable rights of the parties, which works serious injustice to 30 the party concerned. Each and every order passed by the Court during the course of the trial, though may cause some inconvenience to one of the parties or, to some extent, some prejudice to one of the parties, cannot be treated as a 'judgment'. If such is permitted, the floodgate of appeals would be open against the order of Single Judge

The court noted that, in this case, the  order impugned only resulted in postponement of the question as to whether the plaintiff was entitled to grant of an ad ­interim injunction or not, and that too, by merely three weeks. The court therefore observed:

"It is thus clear that there was no adjudication with regard to the rights of the respondent­plaintiff to get an ad­interim injunction during the pendency of the suit. Though by postponement of the issue with regard to grant of ad­interim injunction, the order might have caused some inconvenience and may be, to some extent, prejudice to the respondentplaintiff; the same could not be treated as a 'judgment' inasmuch as there was no conclusive finding as to whether the respondent­plaintiff was entitled for grant of ad­interim injunction or not. As such, the order passed by the learned Single Judge did not contain the traits and trappings of finality. If it is held otherwise, this will open a floodgate of appeals for parties who may even challenge the order of adjournment or 33 grant of time to the other side to file affidavit­in­reply. We are therefore of the considered view that the order dated 2nd April 2019 cannot be construed to be a 'judgment' within the meaning of Clause 15 of Letters Patent and as such, the appeal to the Division Bench of the High Court was not tenable."

The court also criticized the approach of the Division Bench of the High Court to itself dispose of the interlocutory application instead of relegating it to the court below for its disposal.

"When the Division Bench of the High Court itself took 8­ months to decide the appeal, it is difficult to understand as to what the learned Judges of the Division Bench of the High Court meant by "unnecessary prolongation of the litigation and utter wastage of time". If the learned Judges of the Division Bench were so much concerned with the prolongation of litigation, they could have very well requested the learned Single Judge to decide the injunction application within a stipulated period. Instead of waiting for a period of 8­9 months, this could have been done by them at the very first instance when the appeal was listed. The hierarchy of the trial court and the appellate court exists so that the trial court exercises its discretion upon the settled principles of law. An appellate court, after the findings of the trial court are recorded, has an advantage of appreciating the view taken by the trial judge and examining the correctness or otherwise thereof within the limited area available. If the appellate court itself decides the matters required to be decided by the trial court, there would be no necessity to have the hierarchy of courts. As observed by this Court in Monsanto Technology LLC (supra), the appellate court cannot usurp the jurisdiction of the Single Judge to decide as to whether the tests of prima facie case, balance of convenience and irreparable injury are made out in the case or not."

The bench thus requested the single bench of the High Court to decide the expeditiously within a period of six weeks. The court also directed the plaintiff to pay a token cost of Rs.5 lakhs to the Supreme Court Middle Income Group Legal Aid Society (MIG). In this regard the court said:

"We find that it is high time that this Court should take note of frivolous appeals being filed against unappealable orders wasting precious judicial time. As it is, the courts in India are already over­burdened with huge pendency. Such unwarranted proceedings at the behest of the parties who can afford to bear the expenses of such litigations, must be discouraged. We therefore find that the present appeal deserves to be allowed with token costs"

Headnotes

Letters Patent (Calcutta High Court) ; Clause 15 -  Whether an order impugned would be a 'judgment' within the scope of Clause 15 of Letters Patent, would depend on facts and circumstances of each case - For such an order to be construed as a 'judgment', it must have the traits and trappings of finality - It must affect vital and valuable rights of the parties, which works serious injustice to the party concerned. Each and every order passed by the Court during the course of the trial, though may cause some inconvenience to one of the parties or, to some extent, some prejudice to one of the parties, cannot be treated as a 'judgment'. If such is permitted, the floodgate of appeals would be open against the order of Single Judge.

Code of Civil Procedure, 1908 ; Order XXXIX  - Interim injunctions - While considering the question of grant of interim injunction, the courts are required to consider the three tests of prima facie case, balance of convenience and irreparable injury .(Para 36)

Practice and Procedure - Frivolous appeals being filed against unappealable orders wasting precious judicial time - The courts in India are already over­burdened with huge pendency. Such unwarranted proceedings at the behest of the parties who can afford to bear the expenses of such litigations must be discouraged. (Para 37)

Practice and Procedure - The hierarchy of the trial court and the appellate court exists so that the trial court exercises its discretion upon the settled principles of law. An appellate court, after the findings of the trial court are recorded, has an advantage of appreciating the view taken by the trial judge and examining the correctness or otherwise thereof within the limited area available. If the appellate court itself decides the matters required to be decided by the trial court, there would be no necessity to have the hierarchy of courts. (Para 29)

Summary: Appeal against Division Bench order of the Calcutta High Court which allowed Letters Patent appeal against a Single Judge order which directed defendants to file affidavit­ in ­opposition and postponed the hearing of the application seeking injunction - Allowed - Though by postponement of the issue with regard to grant of ad­ interim injunction, the order might have caused some inconvenience and may be, to some extent, prejudice to the plaintiff; the same could not be treated as a 'judgment' inasmuch as there was no conclusive finding as to whether the plaintiff was entitled for grant of ad­ interim injunction or not. As such, the order passed by the Single Judge did not contain the traits and trappings of finality - The appellate court cannot usurp the jurisdiction of the Single Judge to decide as to whether the tests of prima facie case, balance of convenience and irreparable injury are made out in the case or not.

Case details

Case : Shyam Sel And Power Limited vs Shyam Steel Industries Limited | 2022 LiveLaw (SC) 282

Coram: Justices L. Nageswara Rao and B R Gavai

Case no.|date: CA 1984 OF 2022 | 14 March 2022

Counsel: Sr. Adv Mukul Rohatgi for appellant, Sr. Adv Neeraj Kishan Kaul for respondent