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TMI Blog1954 (9) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... each of them to repay or restore a total sum of Rs. 2,19,59,612-7-8, or such other sum as the court might fix, to the assets of the said bank and for various other reliefs. On August 27, 1953, S.R. Das Gupta J. made an order to the effect that the matter should be set down for trial on evidence. On December 16, 1953, Bachawat J. passed an order to the effect that for the purpose of shortening the trial, the parties agreed that copies of relevant documents relied upon by the petitioner should be annexed to a further affidavit to be affirmed by or on behalf of the petitioner, and thereafter the order runs as follows : "Learned counsel on behalf of all the parties are agreed that the original documents save and except the minutes of the meeting of the board of directors, dated June 5, 1945, and July 21, 1945, be proved by affidavit and that copies of original documents, save and except the said two documents, may be admitted in evidence and that formal proof of the original may be dispensed with save and except the said two documents. Learned counsel are also agreed that the further affidavit to be filed on behalf of the petitioner will be admitted at the trial in proof of the se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... With regard to section 202, Indian Companies Act, it is argued that the right of appeal under that section is an independent right and that an appeal will lie under that section against an order even if it is not a "judgment" within the meaning of clause 15 of the Letters Patent. Section 202, Indian Companies Act, so far as it is material for the present purpose, runs as follows : "Appeals from any order or decision made or given in the matter of the winding up of a company by the court may be had in the same manner and subject to the same conditions in and subject to which appeals may be had from any order or decision of the same court in cases within its ordinary jurisdiction." On a plain reading of the section it seems to us that the expression "in the same manner" relates to the procedure about the presentation and hearing of the appeal; but the expression "subject to the same conditions" requires that the order should be such as would be appealable if it had been passed in the exercise of the ordinary jurisdiction of the court. An order made by a single Judge of this court in the exercise of his ordinary original jurisdiction would be appealable under clause 15 of the Let ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appealable, that it must be an order which is not merely a formal or interlocutory order, but one which decides a dispute between the parties and deprives the appellant of a substantial or important right, which comes very near the Calcutta definition of a judgment. The next question that falls for determination is whether the order of Bachawat J. can be said to be a judgment under clause 15 of the Latters Patent. So far as this court is concerned the root authority as to the meaning of judgment under that clause is the case of Justices of the Peace for Calcutta v. Oriental Gas Co. [1872] 8 Beng. LR 433 According to that decision, a judgment under clause 15 means "a decision which affects the merits of the question between the parties by determining some right or liability. It may be either final, or preliminary or interlocutory, the difference between them being that a final judgment determines the whole cause or suit and a preliminary or interlocutory judgment determines only a part of it, leaving other matters to be determined." These observations of Sir Richard Couch C.J. have been followed in all subsequent decisions of this court. Applying this test we are unable to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not appealable under section 202, Indian Companies Act. We have now to consider the question whether the order is appealable under section 45N of the Banking Companies (Amendment) Act, 1953. That section provides "An appeal shall lie from any order or decision of the High Court in a civil proceeding under this Act when the amount or value of the subject matter of the claim exceeds five thousand rupees." The proceedings in which the order under appeal has been made is a proceeding under section 235, Indian Companies Act, and not a "civil proceeding" under the Banking Companies Act. It is true that the Banking Companies (Amendment) Act contains many provisions which regulate the procedure in a proceeding under the Indian Companies Act but that does not convert a proceeding under the latter Act into a proceeding under the former. Many kinds of civil proceedings can be started under the Banking Companies Amendment Act itself; for example, under section 45B the High Court has been given exclusive jurisdiction to decide all claims in respect of banking companies whether such claims have arisen before or after the date of the order for the winding up of the banking company. Similarl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondents should be called upon to prove that they are not guilty of misfeasance. We have no hesitation in holding that this contention is not sound and that it was rightly overruled by the learned Judge. The language used in section 45H is "Where the applicant makes out a prima facie case." In our opinion there is a substantial distinction between "making out" a prima facie case and "disclosing" a prima facie case. If the application does not disclose a prima facie case it is liable to be summarily dismissed ; but if it discloses a prima facie case it will be admitted for further consideration. That is, however, something entirely different from "making out" a prima facie case. Making out a prima facie case, in our opinion, means establishing a prima facie case by legally admissible evidence. That evidence need not always be oral evidence or evidence furnished by documents proved by witnesses in court. It may consist of affidavits provided such affidavits comply with the requirements of Order XIX, rule 3, Civil Procedure Code. Before us the appellant has argued that even if the extreme contention raised before the trial court fails it should be held upon th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry evidence introduced by the subsequent affidavits and that it was prepared to close its case. It pressed the learned Judge to hold that a prima facie case had been made out by the petition and the supporting materials so that, perhaps, even if the respondents succeeded in dislodging the prima facie case, it would then be entitled to commence leading evidence. Bachawat J. did not entertain the contention in the view that the matter had entered the stage of evidence under the order of S.R. Das Gupta J. and that as regards the petition and the supporting materials, they might disclose a prima facie case but by themselves did not make it out. In our opinion, the view taken by Bachawat J. was right. No argument was addressed to us on the sufficiency of the materials contained in the petition and the supporting documents for the purpose of making out a prima facie case and in view of our opinion that the appellant was not entitled to recede to those materials by reason of the order of S.R. Das Gupta J, and its own subsequent conduct, no such argument would be tenable. We, therefore, express no opinion on the contention of the respondents that there was no proper affirmation in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l at all. The section speaks of not only appeals but also re-hearings of appeals and with regard to both it says that they "may be had in the same manner and subject to the same conditions in and subject to which appeals may be had from any order or decision of the same court in cases within its ordinary jurisdiction." It is not said that appeals may be had in the manner and under the conditions of appeals in ordinary cases and that re-hearings may be had in the mariner and under the conditions of re-hearings. Both, it is said, may be had in the manner and under the conditions of appeals. If the section is to be read as providing for a right of appeal, it must be construed as saying that re-hearings may be had in all cases in which appeals may be had which, it appears to me, is an impossible construction. What, to my mind, the section really means is that an appeal from an order made in the course of a winding up or a re-hearing of such an appeal shall be governed procedurally by the rules and conditions applicable to appeals from orders or decisions in cases within the ordinary jurisdiction of the court. Section 202 therefore does not by itself give any right of appeal. Even if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceeding under this Act", i.e., the Banking Companies Act, and not of "an appeal from any order or decision under this Act made or given in a civil proceeding." It also speaks of a case where "the amount or value of the subject matter of the claim exceeds Rs. 5,000." The orders contemplated by the section are clearly orders made in proceedings which are specially authorised by the Banking Companies Act and which involve some claim, such as proceedings under section 45B. The proceeding in which the order appealed from in the present case was passed was a proceeding not under the Banking Companies Act, but under section 235 of the Indian Companies Act. Indeed, section 45H under which the order was made mentions specifically an application under section 235 of the Companies Act and all that the former section does is to provide for an order of a certain kind to be made under it in the course of the proceedings initiated by an application under the latter section. To my mind, section 45N excludes itself from orders of the present kind by its own language. It was contended on behalf of the appellants that the winding up proceedings in the present case were proceedings under the Ban ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court by making rules under the Act. It would, therefore, seem to be unarguable that section 45N contemplated appeals to the Supreme Court. Section 45N of the Banking Companies Act being thus excluded and section 202 of the Indian Companies Act being also excluded as conferring a general or additional right of appeal, one is thrown back on clause 15 of the Letters Patent. The question whether the present appeal could be said to be warranted by the provisions of clause 15 is bound up to a certain extent with the merits of the case, as was rightly pointed out by all the parties. Since we are holding that the appeal is not maintainable, I would not be justified in making any observation on the merits of the case which might cause embarrassment in future and must confine myself to only such matters as cannot be avoided in considering the appealability of the order. The one such matter which is relevant is the true scope of section 45H and it must be adverted to in order to determine the nature of the order appealed from. Section 45H speaks of a case where an application under section 235 of the Companies Act is made and where the applicant makes out a prima facie case. It thus sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plication altogether. Suppose, however, the applicant claims or the court holds in the middle of the applicant's evidence that a prima facie case has been made out and directs the respondents to enter upon their defence. If they do so and succeed in dislodging the prima facie case, it seems impossible that the applicant will then be allowed to revert to leading evidence and proceed with the application. If such a thing is to be allowed once, it must have to be allowed any number of times, whenever it is thought that a prima facie case had been made out and two parties will be adducing evidence and counter evidence alternatively throughout the course of the proceeding. To, my mind such a procedure is inconceivable. If, after he has led some evidence, the applicant asks the court to hold that a prima facie case has been made out, he will do so at his risk because if the prima facie case is disproved, he will not be entitled to make any use of any further evidence that he may have at his command. No applicant will ever take that risk. Similarly, if the court discloses any inclination in the middle of the applicant's evidence to hold that a prima facie case has been made ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commenced in July, 1954, that he first began to think of section 45H and to insist on an order on the basis of that section. Even then he was not saying that he had made out a prima facie case by his application and by the evidence which he had adduced up to that time, but claimed to be entitled to an order under section 45H on the basis of his application and the supporting materials. The extreme and only contention put forward on his behalf before Bachawat J. was that he was entitled in view of section 45H to limit himself to his application and the supporting materials and that the allegations made therein should be held to be an equivalent of a prima facie case. Mr. Justice Bachawat repelled that contention. He recalled the order of S.R. Das Gupta J., which still stood and pointed out that he was not dealing with the case in which an application was tried on affidavits. This would be sufficient to dispose of the applicant's contention, but the learned Judge added that disclosing a prima facie case was not making it out and that the application did no more than disclose a case. In the result, he declined to make an order against the respondents on the basis that an onus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the merits of the case or the merits of the learned Judge's order, if they can be avoided. I may, however, make one observation. It seems to me that although S.R. Das Gupta J. had made an order for a trial of the application on evidence on the 20th August, 1953, it was open to the applicant, after the Banking Companies (Amendment) Ordinance had come into force, to apply for a rescission of that order on the ground that a new law, conferring a new right on the applicant, had since been made and he desired to take advantage of that right. He might have refrained from filing the affidavits he did on the 30th April and the 4th June, 1954, and asked for an order under section 45H on the basis of his application and the supporting materials. He did not take that step with the result that the order of S.R. Das Gupta J. stood. In my view, Bachawat J. was entirely right in holding that in view of that order and the stage which the proceeding had reached, there could be no going back to the stage of trial on affidavits. He was also right in holding that section 45H did not contemplate the mere making of an application under section 235 with the allegations contained in it, but contemplat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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