Hanskumar Kishanchand vs Union of India

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeals Nos. 224 and 225 of 1954

Decision Date: 22 August 1958

Coram: P.B. Gajendragadkar, A.K. Sarkar, T.L. Venkatramaiyar

In the matter titled Hanskumar Kishanchand versus The Union of India and connected appeals, the Supreme Court delivered its judgment on 22 August 1958. The bench comprised Justice P.B. Gajendragadkar, Justice A.K. Sarkar, and Justice T.L. Venkatarama Aiyar. The petitioner was Hanskumar Kishanchand and the respondent was the Union of India along with a connected appeal. The case is reported in the 1958 All India Reporter at page 947 and in the Supreme Court Reporter at page 1177 of the 1959 volume. The appeal arose under the Defence of India Act of 1939, specifically sections 19(1)(b) and 19(1)(f), and involved the applicability of sections 109 and 110 of the Code of Civil Procedure, Act V of 1908, concerning the maintainability of an appeal to the Supreme Court from a decision of the Nagpur High Court. The background of the dispute related to an award of compensation under section 19(1)(b) of the Defence of India Act for premises that had been requisitioned by the Government pursuant to rule 75(A) made under the same Act. Both parties had obtained leave to appeal to the Federal Court under the procedural provisions of the Code of Civil Procedure. The Government raised a preliminary objection, contending that the decision of the High Court was an award rather than a judgment, decree, or order within the meaning of sections 109 and 110, and therefore no appeal could lie from it.

The Court examined the nature of the appeal under section 19(1)(f) of the Defence of India Act, concluding that such an appeal was essentially an arbitration proceeding. Accordingly, the decision rendered in that appeal could not be characterized as a judgment, decree, or order under either the Code of Civil Procedure or clause 29 of the Letters Patent of the Nagpur High Court. The Court relied on the authority in Kollegal Silk Fabrics Limited v. Province of Madras, reported in 1948 Mad 490, to affirm the well‑recognised distinction between a decision given by a court after hearing the merits of a case, which is a judgment, decree, or order appealable under general law, and a decision that constitutes the filing of an award, which is an adjudication by a private individual endorsed by the court and, if it does not exceed the terms of the reference, is final and not subject to ordinary appeal. The Court held that there is no legal difference between an arbitration by agreement of the parties and an arbitration conducted under a statute. When a statute refers a matter to a court as an arbitrator, the resulting decision is an award and is only appealable under the specific provisions of that statute, not under the general provisions of the Code of Civil Procedure. Consequently, the Government’s preliminary objection was upheld, the objection prevailed, and both appeals were dismissed.

In this matter, the Court explained that when it acted as a persona designata, its decision constituted an award, which could not be appealed under the ordinary law but only under the specific statute and to the extent provided by that statute. The Court further observed that an appeal is essentially a continuation of the original proceedings, and therefore, at its inception an arbitration proceeding must retain its character as an arbitration proceeding even where the governing statute permits an appeal. The Court relied on several earlier decisions to support this proposition, namely Rangoon Botatung Company v. The Collector, Rangoon (1912) L.R. 39 I.A. 197; the special officer’s sale of building sites in Dassabhai Beznoji (1912) I.L.R. 37 Bom 506; the special officer’s sale of building sites v. Dassabhai Bozanji Motiwala (1913) 17 C.W.N. 421; Manavikram Tirumalpad v. the Collector of the Nilgiris (1918) I.L.R. 41 Mad 943; and Secretary of State for India in Council v. Hindustan Co‑operative Insurance Society Limited (1931) L.R. 58 I.A. 259. The Court also referred to National Telephone Company Limited v. Postmaster‑General, [1913] A.C. 546, for further explanation.

The judgment concerned Civil Appeals Nos. 224 and 225 of 1954, which were appeals from a judgment dated 31 December 1947 rendered by the former Nagpur High Court in Miscellaneous (First) Appeal No. 310 of 1943. That judgment arose out of an award dated 31 March 1943 issued by the Court of the Arbitrator, Additional District and Sessions Judge, Khandwa. The appellant in Civil Appeal No. 224/54 was Hanskumar Kishanchand, and the respondent in the same appeal was the Union of India, who was also the appellant in Civil Appeal No. 225/54. Legal representatives for the parties were listed, including counsel for the appellant in No. 224/54 and for the respondent in No. 225/54, as well as counsel for the respondent in No. 224/54 and for the appellant in No. 225/54. The judgment was delivered on 22 August 1958 by Justice Venkatarama Aiyar.

Both appeals challenged the judgment of the Nagpur High Court, which had been rendered under section 19(1)(f) of the Defence of India Act, 1939. Under section 75(A) of the Rules made under that Act, the Central Government had requisitioned on 19 February 1941 certain properties belonging to Hanskumar Kishanchand. Because there was no agreement on the compensation amount, the Central Government referred the determination of compensation to Mr. Jafry, Additional District Judge, Khandwa, pursuant to section 19(1)(b) of the Act. On 31 March 1943, Mr. Jafry issued an award granting an annual rent of Rs. 13,000 for occupation of the premises. An appeal against this award was filed before the Nagpur High Court under section 19(1)(f) of the Act and was heard by a bench consisting of Justices Grille C.J. and Padhve J. By their judgment dated 31 December 1947, the bench increased the annual rent payable to the appellant by Rs. 3,250 and awarded additional sums as compensation for the displacement of a high school that had been operating on the property. The appellant subsequently sought leave to appeal this judgment to the Federal Court under sections 109 and 110 of the Code of Civil Procedure, as well as a similar application by the Government concerning the enhanced compensation. Both applications were granted on 25 August 1949, and certificates were issued confirming that the appeals satisfied the requirements of sections 109 and 110 of the Code, thus bringing the two appeals before the present Court.

Two applications were filed concerning the matters that had been disallowed. One application was made under Section 10 of the Code of Civil Procedure for the amounts that had been rejected, and a similar application was presented by the Government seeking enhancement of compensation. On 25 August 1949 both applications were allowed, and a certificate was issued confirming that the appeals satisfied the requirements of Sections 109 and 110 of the Code of Civil Procedure. Consequently, the two appeals were placed before this Court. The appellant, Hanskumar Kishanchand, is the party in Civil Appeal No. 224 of 1954, while the Union of India appears as the party in Civil Appeal No. 225 of 1954. At the commencement of the hearing, the learned Solicitor‑General raised a preliminary objection to the maintainability of Civil Appeal No. 224 of 1954. He argued that the judgment of the High Court rendered in the appeal under Section 19(1)(f) was in fact an award and not a judgment, decree or order within the meaning of Sections 109 and 110 of the Code of Civil Procedure; therefore, the appeal was incompetent. He further contended that if this view were correct, the Government’s appeal, Civil Appeal No. 225 of 1954, would also be incompetent. Although this contention did not prevent the Government from raising the objection, the Court noted that accepting the objection would inevitably lead to the dismissal of both appeals. The Court therefore proceeded to consider the objection on its merits.

The Court then turned to the statutory framework governing the dispute. Section 19(1) of the relevant Act states that whenever an action is taken of the kind described in sub‑section (2) of Section 299 of the Government of India Act, 1935, compensation shall be payable, and the amount shall be determined in the manner and according to the principles set out in the provision. Sub‑section (a) of Section 19(1) provides that the compensation amount may be fixed by agreement. Sub‑section (b) provides that if no agreement can be reached, the Central Government shall appoint an arbitrator who is qualified under sub‑section (3) of Section 220 of the same Act for appointment as a High Court judge. Sub‑section (c) empowers the Central Government to appoint a person possessing expert knowledge of the nature of the property acquired and allows that person to nominate an assessor to assist the arbitrator. Sub‑section (e) requires the arbitrator, when making his award, to consider the provisions of sub‑section (1) of Section 23 of the Land Acquisition Act, 1894, insofar as they are applicable. Sub‑section (f), which is pivotal to the present case, provides that an appeal shall lie to the High Court against an arbitrator’s award except where the amount does not exceed a limit prescribed by a rule made by the Central Government. Sub‑section (g) adds that, save as provided in this section and any rules made thereunder, no other law in force shall apply to arbitrations under this section. The Government contended that the reference under Section 19(1)(b) and the appeal under Section 19(1)(f) are both arbitration proceedings, that the High Court’s decision in the appeal amounts to an award, and consequently is not appealable under Sections 109 and 110 of the Code of Civil Procedure, which apply only to judgments, decrees or orders of courts. The learned counsel for the appellant acknowledged that the proceedings under Section 19(1)(b) are indeed arbitration, but argued that once the matter reaches the High Court through an appeal under Section 19(1)(f), it transforms into a civil proceeding within the ordinary jurisdiction of the Court, and that any decision…

The provision that follows sub‑section (g) declares that, save as provided in this section and in any rules made thereunder, no law then in force shall apply to arbitrations under this section. The Government contends that the reference made in section 19(1)(b) and the appeal provided in section 19(1)(f) are both arbitration proceedings, that the High Court decision in the appeal constitutes an award, and that consequently such a decision is not appealable under sections 109 and 110 of the Code of Civil Procedure because those sections apply solely to judgments, decrees or orders of courts and not to awards. Counsel for the appellant does not dispute that the proceedings under section 19(1)(b) are by way of arbitration, but argues that once the matter is placed before the High Court by way of appeal under section 19(1)(f) it transforms into a civil proceeding within the ordinary jurisdiction of the court, and that any decision rendered therein is therefore open to appeal under sections 109 and 110 of the Code of Civil Procedure. The appellant further asserts that, apart from those provisions, the appeal is competent under clause 29 of the Letters Patent and that the certificate granted by the High Court is likewise issued under that clause. Before examining the authorities cited by either side, it is useful to set out the well‑established principles that govern the issue at hand. When parties agree to settle their dispute by arbitration, the effect of that agreement is to remove the dispute from the hands of the ordinary courts and to entrust its resolution to what is described as a private tribunal. Such an agreement is not rendered void by section 28 of the Contract Act as a restraint on legal proceedings, because section 21 of the Specific Relief Act provides that, save as provided by the Arbitration Act 1940, no contract referring present or future differences to arbitration shall be specifically enforced, and a party who has entered into such a contract and then refuses to perform it is barred from suing on any matter that the contract required to be referred to arbitration. A similar provision exists in section 28 of the Contract Act for situations where the Arbitration Act is not in force. When an arbitration is conducted pursuant to such an agreement and produces a decision, that decision replaces the adjudication that would have been made by the ordinary courts, and the rights of the parties thereafter are regulated by that decision. The law also confers upon courts the authority to set aside an award made by arbitrators on certain grounds, such as when the arbitrators have decided matters not referred to them, have engaged in misconduct, or when the award contains apparent errors. However, where an award is not subject to any of those objections, the court is required to pass a decree in accordance with the award, and under section 17 of the Arbitration Act an appeal against such a decree lies only on the ground that it exceeds or is not otherwise in accordance with the award. Thus, the arbitrator’s decision, when not set aside, operates as the final adjudication binding on the parties, and the court’s role is limited to enforcement of that decision rather than re‑adjudication. There is therefore a clear distinction between a decision pronounced by a court in a cause heard on its merits, which is a judgment, decree or order exercised in its ordinary jurisdiction, and a decision given by a court in the course of filing an award, which is not a judgment in the same sense.

In this case, the Court explained that an arbitral award can be questioned only on very specific grounds, such as lack of jurisdiction, misconduct by the arbitrators, or apparent errors evident on the face of the award. When none of those grounds are applicable, the award is deemed unchallengeable, and the Court is required to issue a decree that gives effect to the award. Under section 17 of the Arbitration Act, an appeal against such a decree is permissible only if the decree exceeds the limits of the award or is not otherwise in conformity with it. Consequently, the decision of the arbitrator, provided it has not been set aside, constitutes the definitive adjudication that binds the parties, and the Court’s role is limited to enforcing that decision by passing the appropriate decree.

The Court highlighted a sharp distinction between two types of judicial actions. The first type is a judgment, decree, or order rendered by a Civil Court while hearing a matter on its merits; such decisions are subject to appeal under the general procedural provisions, for example sections 96, 100, 104, 109 and 110 of the Code of Civil Procedure. The second type is an adjudication by a private tribunal, namely an arbitral award, which bears the seal of the Court only insofar as the Court is directed to enforce it. When the award falls within the scope of the original reference, it is final and not open to appeal. The Court further observed that the same legal position applies when arbitration is not founded on a party agreement but is mandated by a statutory provision. In those circumstances, the statute removes the dispute from the ordinary courts and refers it to a private tribunal; the resulting award enjoys the same status as one arising from a contractual arbitration.

To illustrate this principle, the Court referred to section 46 of the Arbitration Act of 1940, which provides that, except for specific exceptions, the provisions of that Act apply to every arbitration conducted under any other enactment in force, as though the arbitration were based on an agreement and the other enactment were itself an arbitration agreement, to the extent that the Act is not inconsistent with the other enactment or its rules. The Court emphasized that it makes no difference whether the statute designates a Court to act as arbitrator. In such a scenario, the Court does not sit in its ordinary civil capacity but as a persona designata, and its determination is treated as an award that cannot be appealed under the ordinary appellate provisions applicable to court decisions. Conversely, a statute may provide that a dispute be decided by a Court in its ordinary judicial capacity; in that situation, the Court’s decision would be a decree or order subject to the regular appellate jurisdiction, unless the statute expressly limits or removes that right of appeal.

In this context, the Court explained that when a statute refers a dispute to a Court acting as persona designata, the determination rendered by that Court is not a decree or order of its ordinary civil jurisdiction. Consequently, such a decision is treated as an arbitral award and is not subject to appeal under the ordinary law, unless the statute itself provides a specific right of appeal. Conversely, when the reference is to a Court in its capacity as a Court, the decision takes the form of a decree or order within the Court’s regular civil jurisdiction, thereby attracting the usual procedural rules governing Court decisions, including the right of appeal, unless the statute expressly limits or removes that right. The Court noted that it may be necessary to ascertain whether a particular statutory reference designates the Court as a Court or as persona designata; once it is established that the reference is to a Court as persona designata, there can be no doubt that the decision is not appealable under the ordinary law. The Court then turned to the authorities addressing this issue. On behalf of the Government, the Court relied upon the decisions in Rangoon Botatoung Company v. The Collector, Rangoon (1), The Special Officer, Salsette Building Sites v. Dossabhai Bezonji (2), The Special Officer, Salsette Building Sites v. Dassabhai Bozanji Motiwala (3), Manavikraman Tirumalpad v. The Collector of the Nilgiris (4) and Secretary of State for India in Council v. Hindusthan Co‑operative Insurance Society Limited (5) as supporting the contention that the present appeals were incompetent. In Rangoon Botatoung Company v. The Collector, Rangoon (1), the facts involved the acquisition of certain properties under the Land Acquisition Act of 1894, where the Collector determined the compensation payable to the former owners. The owners disputed the quantum of compensation and the matter was referred to the Chief Court of Burma, which sat as a bench of two Judges and awarded a sum of Rs. 13,25,720 as compensation. Dissatisfied with this award, the owners filed an appeal to the Privy Council under the Code of Civil Procedure. A preliminary objection was raised on the ground that the decision sought to be appealed was an award, not a judgment of a Court, and therefore not appealable. The Board, addressing this objection, observed that it could not accept the suggestion that once a claimant is admitted to the High Court he acquires all the rights of an ordinary suitor, including the right to treat an arbitral award concerning the value of land taken for public purposes as if it were a decree of the High Court made in the ordinary course of its jurisdiction.

Shortly after the earlier judgment was delivered, the Court was asked to decide in the matter of The Special Officer, Salsette Building Sites v. Dossabhai Bezonji (1) whether a decision rendered by the High Court on an appeal made under section 54 of the Land Acquisition Act qualified as a judgment within clause 39 of the Letters Patent, thereby permitting a further appeal to the Privy Council under that clause. The party seeking the appeal attempted to separate this situation from the earlier authority of Rangoon Botatoung Company v. The Collector, Rangoon (2). The argument was that in Rangoon Botatoung the decision that was challenged originated from the Chief Court of Burma and the question of whether the appeal was maintainable was to be answered according to the Code of Civil Procedure, whereas in the present case the party claimed a direct right to approach the Privy Council under clause 39 of the Letters Patent. The High Court rejected this distinction. Referring to the observations made in the Rangoon Botatoung case, the Court noted that “this passage shows that it is a mistake to suppose that the award made in such a case by the High Court is a decree within the ordinary jurisdiction to which the Civil Procedure Code refers; and it seems to me it would be equally erroneous to regard such an award as a final judgment or order within the meaning of clause 39 of the Letters Patent.” Consequently, the request to allow an appeal to the Privy Council was refused.

Subsequently, an application for special leave to appeal to the Privy Council was filed in the same matter, but that application was also dismissed. The report of the proceedings before the Privy Council in The Special Officer, Salsette Building Sites v. Dassabhai Basanji Motiwala (3) confirmed that the interpretation advanced by the Bombay High Court in The Special Officer, Salsette Building Sites v. Dossabhai Bezonji (1) was accepted as correct. In a later case, Manavikraman Tirumalpad v. The Collector, the Court examined whether a judgment of the High Court handed down on an appeal under the Land Acquisition Act constituted a judgment within the meaning of clause 15 of the Letters Patent, which would have entitled a party to file a further appeal to the High Court under that provision. The Court, after considering the authorities previously cited, held that such a decision was not a judgment within clause 15. The decision in Secretary of State for India in Council v. Hindusthan Cooperative Insurance Society Limited (2) involved the Calcutta Improvement Act, 1911, which established a tribunal to determine compensation on land acquisition. Under the Calcutta Improvement (Appeals) Act, 1911, an appeal from the tribunal’s decision could be made to the Calcutta High Court. The precise question that arose was whether the High Court’s decision on that appeal could itself be subjected to a further appeal to the Privy Council. The Court proceeded to consider this issue.

Answering the question in the negative, the Privy Council observed that, in view of the decision in Rangoon Botatoung Company v. The Collector, Rangoon (3), there could be no right of appeal against the decision of the High Court. The Council further held that this conclusion was not altered by the amendment of the Land Acquisition Act, 1921, which provided for an appeal to the Privy Council against a High Court decision under section 54 of that Act, because that amendment could not be said to have been incorporated by reference into the Calcutta Improvement Act, 1911. The law set out in the cited authorities may therefore be summarized as follows: not every decision rendered by a Court can be described as a judgment, decree or order within the meaning of the Code of Civil Procedure or the Letters Patent. Whether a decision qualifies depends on whether the proceeding in which it was given arose before the Court in its ordinary civil jurisdiction, or whether the Court was acting as a persona designata. When a dispute is referred to the Court for determination by way of arbitration, as in Rangoon Botatoung Company v. The Collector, Rangoon (3), or when the matter proceeds by way of appeal against an alleged award, as in The Special Officer, Salsette Building Sites v. Dossabhai Bezonji (1), Manavikraman Tirumalpad v. The Collector of the Nilgris (2) and Secretary of State for India in Council v. Hindusthan Co‑operative Insurance Society Limited (3), the decision emerging from such proceedings is not regarded as a judgment, decree or order under either the Code of Civil Procedure or the Letters Patent.

The counsel challenging this proposition relied heavily on the decision in National Telephone Company Limited v. Postmaster‑General (4). In that case the issue was the construction of certain provisions of the Telegraph (Arbitration) Act, 1909. Section I of that Act provided that any difference between the Postmaster‑General and another person, if the parties agreed, could be referred for decision to the Railway and Canal Commission, which had been constituted under an Act of 1888; section 2 required that all enquiries under the reference be conducted by the Commission in accordance with the 1888 Act. Following a reference under these provisions, the Railway and Canal Commission determined the disputes, and the question arose whether its decision was open to appeal. Under the 1888 Act the Commission was constituted as a Court of record, and an appeal lay against its decision to the Court of Appeal, except on questions of fact and standing. The House of Lords held that because, under the 1888 Act, the reference to the Commission was to it as a Court, the reference made under the Telegraph (Arbitration) Act, 1909, to that tribunal must also be regarded as a reference to a Court.

In this matter, the Court held that the reference made under the Telegraph (Arbitration) Act was to the Railway and Canal Commission as a Court, not as a panel of arbitrators, and consequently an appeal from the Commission’s decision was permissible. The Court quoted Viscount Haldane, L.C., who observed that when a question is said to be referred to an established Court without any further qualification, it necessarily imports the ordinary procedural incidents of that Court and also the general right of appeal from its decision. The statement was supported by earlier authorities including reports from 1912, 1918, 1931 and the 1913 decision of the House of Lords. The Court noted that the mere presence of the word “arbitration” in the title of the 1909 Act had been used by some to argue that the proceedings before the Commission were arbitrative in nature. However, the Court emphasized that such a label could not change the substantive character of the reference, which was expressly to a Court of record. Accordingly, the proceedings before the Commission contained no element of arbitration. Although the 1909 Act allowed a reference only when the parties agreed, the Court explained that the agreement of the parties does not alter the character of the proceedings; statutes may confer jurisdiction on a Court even when it is invoked by agreement, for example, a case stated under Order 36 of the Code of Civil Procedure. The Court therefore found no conflict between the earlier decision of National Telephone Company Limited v. Postmaster‑General and the principle laid down in Rangoon Botatoung Company v. The Collector, Rangoon, which holds that when a reference is to a Court acting as arbitrator its decision is not appealable. The distinction between references made to a Court as a Court and those made to it as an arbitrator was reaffirmed by the Privy Council in Secretary of State for India v. Chelikani Rama Rao, a case concerning the Madras Forest Act, 1882, where the Court distinguished the nature of proceedings under a Land Acquisition Act, characterizing them as arbitration, from those under the Forest Act, which were essentially different in character.

In this case the Court observed that, although some proceedings might appear to be arbitration in form, the proceedings created under the Forest Act were essentially different in character. The Court explained that the claim involved an assertion of a legal right to possession and ownership of land, and that when ordinary courts of the country are seized of a dispute of that nature, a specific limitation would be required, in the opinion of the Board, to exclude the ordinary incidents of litigation. The principles underlying this distinction were therefore regarded as well‑settled, and the Court turned to the question of whether an appeal to the High Court under section 19(1)(f) of the Act should be presented before it as a Court or as an arbitrator.

The Court noted that under section 19(1)(b) the reference is expressly to an arbitrator. The arbitrator need not be a Judge of a Court; it is sufficient that the person is qualified to be appointed a Judge of the High Court. Consequently, under the law no appeal lies to the High Court against the decision of such an arbitrator. Accordingly, the provision for appeal to the High Court under section 19(1)(f) can only be construed as a reference to the High Court as an authority designated for the purpose, not as a Court in the ordinary sense. The fact that, in the present matter, the reference was to a District Judge did not alter this position. Moreover, the decision of the arbitrator appointed under section 19(1)(b) is expressly termed an “award” in section 19(1)(f). An appeal is essentially a continuation of the original proceedings, and if the proceedings under section 19(1)(b) are arbitration proceedings, their character cannot change simply because they are brought before an appellate tribunal. The Court relied on the decisions in The Special Officer, Salsette Building Sites v. Dossabhai Bezonji (1912 I.L.R. 37 Bom. 506), The Special Officer, Salsette Building Sites v. Dassabhai Basanji Motiwala (1913 17 C.W.N. 421), Manavikraman Tirumalpad v. The Collector of the Nilgris (1918 I.L.R. 41 Mad. 943) and Secretary of State for India in Council v. Hindusthan Co‑operative Insurance Society Limited (1931 L.R. 58 I.A. 259). All those authorities held that an appeal against an award remains a further stage of the original arbitration proceedings. In the Court’s view, a proceeding that begins as arbitration must retain its character as arbitration even when it is taken up on appeal, provided the statute permits such an appeal. The question of whether an appeal under section 19(1)(f) is of the nature of arbitration proceedings, and whether the decision given therein is an award, was considered directly in Kollegal Silk Filatures Ltd. v. Province of Madras, where a Bench of the Madras High Court held that the word “arbitration” in section 19(1)(g) of the Act covered the entire proceedings from their commencement before the arbitrator to their termination in the High Court.

In this case, the Court observed that when an appeal was filed under section 19(1)(f) and the High Court heard and decided the appeal while essentially functioning as an arbitration tribunal, the appeal itself must be treated as an arbitration proceeding. Consequently, the Court agreed with the earlier decision that the appeal under section 19(1)(f) was not a judgment, decree or order within the meaning of sections 109 and 110 of the Code of Civil Procedure or clause 29 of the Letters Patent of the Nagpur High Court, which corresponds to clause 39 of the Letters Patent of the Calcutta, Madras and Bombay High Courts. Because the decision of the High Court in that appeal was an award rather than a judicial decree, the Court held that the present appeals were incompetent.

Mr Achbru Ram subsequently contended that even if no appeal lay under sections 109 and 110 of the Code of Civil Procedure or clause 29 of the Letters Patent, the Supreme Court still possessed the competence to grant leave to appeal and that this case was suitable for such leave. He argued that the Privy Council originally had the power to grant leave to appeal against the Nagpur High Court’s decision in the appeal under section 19(1)(f); that, under section 3(a)(ii) of the Federal Court (Enlargement of Jurisdiction) Act I of 1948, that power had been transferred to the Federal Court; and that, under Article 135 of the Constitution, the power now rested with the Supreme Court. He further submitted that, in exercising this power, the Court should grant leave to appeal against the decision now under challenge.

The Court found that the contention could be answered by noting that the Federal Court’s power under section 3(a)(ii) to grant leave was limited to situations where the proposed appeal was against a judgment. According to the definition in section 2(b), a “judgment” meant a judgment, decree or order of a High Court in a civil case. Since the Court had concluded that the decision in the appeal under section 19(1)(f) was an award and not a judgment, decree or order, no special leave could be granted under section 3(a)(ii). Accordingly, the Court dismissed both appeals as incompetent, ordered that each party bear its own costs in the Supreme Court, and entered the appeals as dismissed.