Supreme Court Sets Aside Kerala High Court Order for Fresh Trial in Sale Deed Dispute: Sirajudheen vs. Zeenath (2023)

Introduction

Date of the Judgment: 27 February 2023

Citation: 2023 INSC 173

Judges: Dinesh Maheshwari, J., Sudhanshu Dhulia, J.

Can a High Court order a fresh trial in a civil case simply because it finds the evidence insufficient, even when the trial court has already made a decision based on the same evidence? The Supreme Court of India recently addressed this question in a case involving a property dispute, ultimately setting aside the High Court’s order for a fresh trial. The core issue revolved around whether the High Court was justified in remanding the case for a retrial when the existing evidence was deemed sufficient for a decision. The judgment was delivered by a two-judge bench comprising Justice Dinesh Maheshwari and Justice Sudhanshu Dhulia, with the opinion authored by Justice Dinesh Maheshwari.

Case Background

The dispute originated from a property consisting of land and a cinema theatre, which was initially owned by the respondents’ father. After his death, the respondents (five sisters) and their mother executed a partition deed in 2003, keeping the property in their joint possession. They also formed a partnership to manage the cinema theatre, named ‘Tharangam theatre’, with the husband of respondent No. 1 managing it.

On March 15, 2006, respondent No. 1 was asked to sign a document at the Sub Registrar’s Office, allegedly under the guise of executing a security bond for a film distributor. However, she later discovered it was a sale deed transferring her share of the property to the appellant. Respondent No. 1 claimed she received no consideration for the sale and that the deed was void. She filed a suit to cancel the sale deed.

The Trial Court dismissed the suit, finding no evidence of fraud and noting that the plaintiff failed to examine the Sub Registrar who registered the deed. The Trial Court held that the plaintiff had not discharged her burden of proof as required by Section 103 of the Indian Evidence Act, 1872.

The High Court, in a common judgment, addressed four appeals related to the same parties and issues. While it upheld the partition decrees sought by other sisters, it remanded the suit for cancellation of the sale deed for a fresh trial, stating that the evidence was insufficient for a proper determination.

Timeline:

Course of Proceedings

The Trial Court, after examining the evidence, dismissed the suit filed by respondent No. 1, stating that the circumstances did not support her claim of being defrauded into signing a sale deed. The court also noted that she did not examine the Sub Registrar who registered the sale deed, failing to meet the burden of proof under Section 103 of the Indian Evidence Act, 1872.

The High Court, while addressing multiple appeals, upheld the Trial Court’s decisions in the partition suits filed by the other sisters. However, regarding the suit for cancellation of the sale deed, the High Court noted conflicting circumstances and concluded that the evidence was insufficient for a proper determination. Consequently, it set aside the Trial Court’s judgment and remanded the matter for a fresh trial, allowing the parties to present additional evidence.

Legal Framework

The case primarily involves the interpretation and application of several key legal provisions:

✓ Section 103 of the Indian Evidence Act, 1872: This section deals with the burden of proof, stating that the burden of proof lies on the person who asserts a particular fact. In this case, the Trial Court held that the plaintiff (respondent No. 1) failed to prove that she was defrauded into signing the sale deed.

✓ Section 114 of the Indian Evidence Act, 1872: This section allows the court to make presumptions based on certain facts. Illustration (g) of this section states that the court may presume that evidence which could be produced but is not, would be unfavorable to the person who withholds it. The appellant argued that an adverse inference should have been drawn against the plaintiff for not presenting herself in the witness box.

✓ Section 120 of the Indian Evidence Act, 1872: This section states that in civil proceedings, the parties to the suit, and the husband or wife of any party to the suit, shall be competent witnesses. The respondent No. 1 argued that her husband was a competent witness to depose on her behalf.

✓ Order XLI, Rules 23, 23-A, 24, 27, and 33 of the Code of Civil Procedure, 1908 (CPC): These rules govern the powers of the Appellate Court, specifically regarding the remand of cases, the production of additional evidence, and the general powers of the court of appeal. Rule 23 allows for remand when a suit is decided on a preliminary point. Rule 23-A allows for remand in other cases where a retrial is necessary. Rule 24 allows the Appellate Court to determine the case finally if the evidence is sufficient. Rule 27 deals with the production of additional evidence in the Appellate Court. Rule 33 gives the Appellate Court the power to pass any decree or order that ought to have been made.

Arguments

Appellant’s Arguments (Sirajudheen):

• The High Court’s decision to remand the case for a fresh trial was unjustified because the plaintiff failed to prove her case by not producing sufficient evidence.
• The High Court should not have remanded the suit for a fresh trial when neither any ground was pleaded nor any relief was sought for a fresh trial.
• The plaintiff did not examine herself or the Sub Registrar, and her husband was examined as a witness, which warrants an adverse inference against her under illustration (g) to Section 114 of the Evidence Act.
• The Trial Court’s decision was reasonable based on the evidence, and there was no reason to remand the case for a trial de novo.
• The appellant relied on the decision of the Supreme Court in Municipal Corporation, Hyderabad v. Sunder Singh [(2008) 8 SCC 485], to argue that an order of remand cannot be passed on the court’s own discretion.

Respondent’s Arguments (Zeenath):

• The sale deed was void as no consideration was passed to her, and she was made to sign it under the belief that it was a security document.
• The High Court had the power to remand the matter to the Trial Court, even suo motu, when it found that necessary evidence for proper determination of the suit was not on record.
• The High Court’s decision was justified to secure the ends of justice.
• The husband of the plaintiff was a competent witness under Section 120 of the Evidence Act, and it was immaterial that the plaintiff did not enter the witness box.
• The respondent relied on the decision of the Supreme Court in Sanjay Kumar Singh v. State of Jharkhand [(2022) 7 SCC 247] to argue that the appellate court may permit additional evidence if the conditions laid down in Order 41 Rule 27 CPC are found to exist.

Issues Framed by the Supreme Court

The core issue framed by the Supreme Court was:

✓ Whether the High Court was justified in remanding the matter for trial de novo (fresh trial)?

Treatment of the Issue by the Court

Authorities

Cases Cited:

• Municipal Corporation, Hyderabad v. Sunder Singh [(2008) 8 SCC 485] – Supreme Court of India: This case was cited by the appellant to argue that an order of remand cannot be passed on the court’s own discretion. The Supreme Court reiterated that the scope of remand under Order 41 Rule 23 and 23-A of the CPC is limited and should not be used without proper justification.
• Sanjay Kumar Singh v. State of Jharkhand [(2022) 7 SCC 247] – Supreme Court of India: This case was cited by the respondent to argue that the appellate court may permit additional evidence under Order 41 Rule 27 CPC. The Supreme Court distinguished this case, stating that it does not apply as no party sought permission to adduce additional evidence.

Legal Provisions Considered:

• Section 103 of the Indian Evidence Act, 1872: The Supreme Court noted that the Trial Court correctly applied this provision, stating that the burden of proof was on the plaintiff to prove her claim of fraud.
• Section 114 of the Indian Evidence Act, 1872: The Supreme Court considered illustration (g) of this section, which allows the court to presume that evidence which could be produced but is not, would be unfavorable to the person who withholds it. The appellant argued that this should have been applied against the plaintiff.
• Section 120 of the Indian Evidence Act, 1872: The Supreme Court acknowledged that the husband of the plaintiff was a competent witness under this section.
• Order XLI, Rules 23, 23-A, 24, 27, and 33 of the Code of Civil Procedure, 1908: The Supreme Court analyzed these rules to determine if the High Court’s order of remand was justified. It concluded that the remand was not justified under Rules 23 or 23-A, and Rule 27 was not applicable as no additional evidence was sought.

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• Municipal Corporation, Hyderabad v. Sunder Singh [(2008) 8 SCC 485]: The Supreme Court followed this authority, emphasizing that an order of remand cannot be based on the court’s discretion alone. The Court reiterated that the scope of remand under Order 41 Rule 23 and 23-A of the CPC is limited and should not be used without proper justification.
• Sanjay Kumar Singh v. State of Jharkhand [(2022) 7 SCC 247]: The Supreme Court distinguished this case, stating that it does not apply because no party sought permission to adduce additional evidence. The Court clarified that the High Court’s order for a fresh trial was not based on the need for additional evidence under Order 41 Rule 27 of the CPC.
• Section 103 of the Indian Evidence Act, 1872: The Supreme Court noted that the Trial Court correctly applied this provision, stating that the burden of proof was on the plaintiff to prove her claim of fraud.
• Section 114 of the Indian Evidence Act, 1872: The Supreme Court considered illustration (g) of this section, which allows the court to presume that evidence which could be produced but is not, would be unfavorable to the person who withholds it. The appellant argued that this should have been applied against the plaintiff.
• Section 120 of the Indian Evidence Act, 1872: The Supreme Court acknowledged that the husband of the plaintiff was a competent witness under this section.
• Order XLI, Rules 23, 23-A, 24, 27, and 33 of the Code of Civil Procedure, 1908: The Supreme Court analyzed these rules to determine if the High Court’s order of remand was justified. It concluded that the remand was not justified under Rules 23 or 23-A, and Rule 27 was not applicable as no additional evidence was sought.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the procedural impropriety of the High Court’s remand order. The Court emphasized that the High Court did not provide sufficient reasons for reversing the Trial Court’s decision and ordering a fresh trial. The Court noted that the existing evidence was sufficient for a decision, and the High Court did not specify what additional evidence was required or why the Trial Court’s findings were unsustainable.

The Court also highlighted that the High Court’s order was based on its own discretion without a proper legal basis, and that the High Court failed to analyze the Trial Court’s findings. The Supreme Court’s focus was on the procedural aspects of the remand order rather than the substantive merits of the case.

Fact:Law Ratio

Logical Reasoning:

The Supreme Court considered alternative interpretations of the law but rejected them. The Court specifically rejected the respondent’s argument that the High Court had the power to remand the matter when it found that necessary evidence was not on record. The Court emphasized that the High Court did not justify its decision to reverse the Trial Court’s findings, and that the existing evidence was sufficient for a decision.

The Supreme Court’s decision was based on the procedural impropriety of the High Court’s remand order. The Court held that the High Court could not remand the case for a fresh trial without providing sufficient reasons for reversing the Trial Court’s decision and without specifying what additional evidence was required. The Court’s decision was aimed at ensuring that appellate courts do not remand cases arbitrarily and that the existing evidence is properly considered before ordering a fresh trial.

The reasons for the decision are:

• The High Court did not provide sufficient reasons for reversing the Trial Court’s decision.
• The existing evidence was sufficient for a decision.
• The High Court did not specify what additional evidence was required.
• The High Court’s order was based on its own discretion without a proper legal basis.
• The High Court failed to analyze the Trial Court’s findings.

“From the above, I notice that evidence necessary for a proper determination of the suit has not been brought on record.”

“The evidence on record is insufficient to arrive at a proper finding in favour of or against Ext.A1 Sale Deed.”

“Material witnesses have not been examined. No evidence has been brought in with regard to passing of consideration.”

Key Takeaways

• Appellate courts must provide clear and sufficient reasons for reversing a trial court’s decision and ordering a remand for a fresh trial.
• Remand orders should not be based on the appellate court’s discretion alone but must be justified under the applicable provisions of the Code of Civil Procedure.
• Existing evidence must be properly considered, and a fresh trial should not be ordered merely because the appellate court could not reach a conclusion on the basis of the existing evidence.
• Parties must ensure that all necessary evidence is presented during the initial trial, as appellate courts are not meant to provide a second chance for parties to fill gaps in their evidence.
• The Supreme Court’s decision reinforces the importance of procedural correctness in judicial proceedings and the need for appellate courts to adhere to the prescribed legal framework.

The decision may impact future cases by emphasizing that High Courts must provide clear reasons for reversing lower court decisions and remanding cases for fresh trials. This will ensure that cases are not remanded unnecessarily and that the existing evidence is properly considered.

Directions

The Supreme Court set aside the High Court’s order for a fresh trial and restored the appeal for reconsideration by the High Court. The parties were directed to appear before the High Court on 20.03.2023.

Specific Amendments Analysis

Not Applicable

Development of Law

The ratio decidendi of this case is that an appellate court cannot remand a case for a fresh trial without providing sufficient reasons for reversing the trial court’s decision and without specifying what additional evidence is required. This judgment clarifies the limitations on the power of appellate courts to remand cases and reinforces the importance of considering existing evidence before ordering a fresh trial.

There is no change in the previous positions of law. The Supreme Court has reiterated the established principles regarding the powers of appellate courts under the Code of Civil Procedure.

Conclusion

The Supreme Court allowed the appeal, setting aside the Kerala High Court’s order for a fresh trial in a property dispute case. The Court emphasized that the High Court did not provide sufficient reasons for reversing the Trial Court’s decision and that the existing evidence was sufficient for a determination. The case was remanded back to the High Court for reconsideration, highlighting the need for appellate courts to adhere to procedural norms and provide clear justifications for their decisions.