Chitturi Subbanna vs Kudapa Subbanna and Others

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

Court: Supreme Court of India

Case Number: Civil Appeal No. 598 of 1961

Decision Date: 18 December 1964

Coram: Raghubar Dayal, J.R. Mudholkar, S.M. Sikri

In this matter the parties were Chitturi Subbanna as the petitioner and Kudapa Subbanna together with others as the respondents. The judgment was delivered on 18 December 1964 by a bench of the Supreme Court of India consisting of Justice Raghubar Dayal, Justice J. R. Mudholkar and Justice S. M. Sikri. The case is reported in the 1965 volume of the All India Reports at page 1325 and in the 1965 Second Series of the Supreme Court Reports at page 661. The authorities cited in later courts include references R 1979 SC 1214 and D 1984 SC 1696. The legal provision that formed the core of the dispute was Order XX, rule 12 of the Code of Civil Procedure (Act 5 of 1908), dealing with the effect of a preliminary decree that is not appealed against and the consequent procedural consequences.

The suit concerned possession of land and the recovery of mesne profits. The High Court, after hearing the parties, directed in the preliminary decree that the trial court should conduct an enquiry into the mesne profits payable by the appellant, who was the judgment debtor, from the date the suit was instituted, and that a final decree should be passed for the amount found due up to the date possession was delivered to the respondent, who was the decree holder. The trial court appointed a Commissioner to conduct the enquiry, and after considering the Commissioner’s report, the trial court issued a final decree ordering the appellant to pay a specified sum. The appellant did not object before the Commissioner nor before the trial court to the basis on which accounts could be taken under Order XX, rule 12, which limits such enquiries to a period of three years from the date of the preliminary decree and does not extend to the later date of possession. In the appeal before the High Court, the appellant also failed to raise this ground in the memorandum of appeal, but attempted to do so during the oral argument. The High Court refused to permit the new ground and dismissed the appeal. In the same proceeding the High Court considered the respondent’s cross‑objections, which sought an enhancement of the mesne profit amount, and partially allowed those cross‑objections. Before the Supreme Court the appellant contended that (i) the High Court erred in refusing to allow the appellant to raise the objection based on Order XX, rule 12, (ii) the respondent was not entitled to mesne profits for a period exceeding three years from the preliminary decree, and (iii) the High Court erred in increasing the mesne profit amount. The Supreme Court held, on the reasoning of Justices Dayal and Sikri, that the High Court was in error in not allowing the appellant to urge the additional ground, observing that the question was a pure question of law not dependent on any factual determination and that such pure questions may be raised for the first time even at later stages of the litigation. The Court noted that although the High Court possesses discretion to allow or refuse an application to raise an additional ground, that discretion must be exercised in accordance with the principle that a pure question of law may be urged at any stage. The Court further held that a decree under Order XX, rule 12 directing an enquiry into mesne profits must be construed as an instruction to conduct the enquiry in conformity with the requirements of rule 12(1).

In this case the Court observed that an order refusing permission could be interfered with by the Supreme Court because such an order did not conform to the principle that a question of pure law may be urged at any stage of the proceedings [664 H; 666 D‑F‑G]. The Court noted that there was no evidence that the appellant had conceded before the Commissioner or had elected, before the trial court, that mesne profits could be calculated up to the date of delivery of possession when no dispute concerning that matter existed between the parties [666 H]. Moreover, the Court held that the respondent could not have suffered prejudice from the appellant’s decision to raise the new ground at the hearing of the appeal rather than earlier, because even if the appellant had raised the ground before the Commissioner the respondent would have been unable to sue for mesne profits beyond three years, the limitation period for such a suit having already expired [669 A‑B]. The Court then turned to the effect of a decree made under Order XX, rule 12 of the Code. It stated that a decree directing an enquiry into mesne profits, however it is expressed, must be interpreted as a decree directing the enquiry in accordance with the requirements of rule 12(1)(c); consequently the respondent could not claim mesne profits for a period exceeding three years from the date of the preliminary decree [676 A‑B]. The Court explained that the court is entitled to construe such a direction in line with the provisions of the rule when the direction is not fully expressed so as to cover every alternative mentioned in the rule [673 F]. It further held that the direction contained in the preliminary decree could not have been the subject of an appeal, because the question of the proper period for which mesne profits should be decreed arises only at the time the final decree is passed, when the parties will know the exact period for future mesne profits; consequently an appeal could be instituted only after the final decree, and section 97 of the Code would not apply. The Court added that the direction in the preliminary decree did not operate as res judicata either under section 11 of the Code or on general principles, since there was no controversy between the parties [674 A; E‑H]. Instead of insisting that the court repeat in its judgment all the alternatives mentioned in the rule, the Court preferred to interpret the judgment in accordance with those provisions; when construed in this manner, there is no possibility for a decree holder to benefit from his own default [675 D‑E, G]. The Court reviewed the case law on the point. In a dissenting opinion, Justice Mudholkar stated that the High Court was correct in refusing leave to the appellant to raise a new ground at the hearing because the appellant neither raised the ground in the memorandum of appeal nor had he avoided allowing an enquiry into mesne profits by the Commissioner for a period longer than three years from the decree, and he participated in that enquiry [683 G]. He further observed that the grant or refusal of permission was within the discretion of the High Court and

The Court observed that the High Court had provided very good and cogent reasons for refusing permission. It held that when a party fails to raise an objection to a direction issued by a lower court in its judgment, that party must be considered to have waived the right to contest that direction later, and the party cannot for the first time at the hearing of an appeal challenge the lower court’s power to give the direction. According to the Court, the proper function of an appellate court is to correct an error in the judgment or the proceedings of the court below and not to decide a different kind of dispute that was never before that court. The Court further explained that only in exceptional cases may an appellate court, in its discretion, permit a new point to be raised before it, and that such discretion may be exercised only where there are good grounds for allowing the new point and where no prejudice is caused to the opposite party. The Court referred to the relevant case law in reaching this conclusion. [684 D‑E; 686 G; 688 E‑G]

Turning to the merits of the contention, the Court stated that even if the direction in the preliminary decree were assumed to be wrong, that decision had to be given effect because it had not been challenged in appeal and therefore had become final under section 97 of the Code. The Court explained that unless the decision is corrected in the manner provided by the Code, it will operate as res judicata between the parties at all subsequent stages of the suit. The Court noted that where the meaning of a term is unclear or ambiguous, the question of construction may arise and the court may appropriately construct the term in conformity with law. However, the Court found that the direction in the present case did not suffer from vagueness, ambiguity, or any incompleteness that would render its enforcement impossible. The Full Court observed that the High Court had altered the rates of mesne profits without stating reasons for holding that the Subordinate Judge was wrong in his findings. Consequently, the Court ordered that the matter be remanded to the High Court for a fresh determination of the quantum of mesne profits, limited to a period of up to three years from the date of the preliminary decree, as dictated by the majority judgment. The Court then set out the formal details of the judgment, noting its civil appellate jurisdiction in Civil Appeal No. 598 of 1961, the parties involved, the counsel appearing for each side, and the authorship of the judgment by Raghubar Dayal J., with Mudholkar J. delivering a dissenting opinion. [676 E; 681 F; 692 E; 689 D‑E; 692 B; 691 B‑C]

The decree awarded the plaintiff a one‑twenty‑fourth share in the properties listed in Schedule B that was attached to the plaint, as well as the shares described in Schedules A and C. The defendants who were then in possession of those properties were ordered to surrender possession to the decree‑holder. The properties described in Schedule B were to be first divided according to the proportions set out in paragraph 9 of the plaint, and the decree‑holder was to receive the portion to which the first plaintiff was shown to be entitled. The trial Court was instructed to conduct an enquiry into the mesne profits accruing from the date the suit was instituted and to issue a final decree requiring payment of any amount found to be due up to the date when possession was delivered to the second plaintiff. Possession of the properties covered by Schedules A and C was actually delivered to the decree‑holder on 17, 18 and 20 February 1943. On 23 June 1945, the decree‑holder filed application I.A. 558 of 1949 in order to revive and continue an earlier application, I.A. 429 of 1940, which had been presented for the purpose of ascertaining future profits and which had been struck off on 25 September 1944. Subsequently, on 28 July 1948, the Subordinate Judge decreed mesne profits together with interest for the period spanning 1926‑27 to 1942‑43 in relation to the properties listed in Schedules A and C. The total amount adjudicated was Rs 17,883‑8‑3, of which Rs 10,790‑0 represented mesne profits. The Judge also decreed mesne profits for the properties in Schedule B up to the year 1946; those determinations are not presently in dispute. On 22 April 1949, Chitturi Subbanna, the first defendant, filed an appeal before the High Court. The decree‑holder responded with cross‑objections, asserting that the mesne profits actually due to him were approximately Rs 45,000, although he limited his claim to a sum of Rs 19,000. On 13 September 1958, the High Court dismissed the original appeal but allowed the cross‑objection, resulting in a substantial increase in the mesne‑profit amount that had been decreed by the Subordinate Judge with respect to the Schedule A and C properties. Consequently, the mesne‑profit award was raised to Rs 17,242‑12‑0, and the corresponding interest was also increased. Following this, Chitturi Subbanna obtained leave from the High Court to appeal to this Court, contending that the High Court’s decree constituted a variance and that the value of the subject matter in dispute exceeded Rs 10,000. The appellant then applied to the High Court for permission to raise an additional ground of appeal, arguing that the trial Court should not have been authorised to award mesne profits for a period longer than three years from the date of the High Court’s decree. The High Court rejected this request on the basis that the appellant had not included such a ground in the memorandum of appeal and, furthermore, had previously conceded before the Commissioner and the trial Court that accounts could be taken up to 1943 with respect to the Schedule A and C properties, and that he had elected to have the profits determined by the trial Court.

In this case, the Court observed that the trial Court had fixed the date for payment of mesne profits only up to the date when possession was delivered. The Court noted that, had the appellant raised his objection at an earlier stage, the second plaintiff‑respondent would have been entitled to file a suit for recovery of mesne profits for a period longer than three years, extending up to the actual date of delivery of possession. The appellant contended before the Supreme Court that the High Court erred in refusing to permit him to raise the objection on the basis of Order 20, rule 12 of the Code of Civil Procedure. The Court agreed with this submission, holding that the matter raised was a pure question of law and did not depend on any factual determination. Consequently, the first appellate Court should have allowed the point to be raised, and pure questions of law may be considered even at later stages of the proceedings. The Court further observed that the appellant had not claimed a right to introduce a new ground that was omitted from the memorandum of appeal; instead, he had filed a separate application seeking permission to raise the issue. The Court found that this procedure was consistent with the approach suggested in Wilson v. United Counties Bank, Ltd., which permits parties in exceptional cases to apply substantively for the Court’s indulgence to add new grounds not previously notified. The Court also referred to the decision in Yeswant Deorao Deshmukh v. Walchand Ramchand Kothari, where it allowed a question of law to be raised at the hearing of an appeal despite the absence of any reference to it in the lower courts or in the appeal’s grounds. In that case, the Court explained that when the established facts were sufficient to create a case of fraud within the meaning of section 18, the issue of the section’s applicability was purely legal and could be raised at any stage, including the final appellate court. The Court cited Lord Watson’s observations in Connecticut Fire Insurance Co. v. Kavanagh, stating that when a legal question is first raised in a court of last resort on the construction of a document or on undisputed facts, it is both competent and expedient to entertain the plea, provided that resolving the question does not require the court to decide complex factual matters that would place it at a disadvantage compared with lower courts. Finally, the Court referenced the decision in M. K. Ranganathan v. Government of Madras, which affirmed that a High Court may permit a respondent to raise a pure question of law even at a late stage in the proceedings.

In the earlier part of the judgment it was observed that raising a contention at a very late stage was permissible because the issue involved only a pure question of law and therefore the learned Solicitor‑General correctly refrained from pressing the first contention before the Court. The judgment cited authorities such as L.R. [1920] A.C. 102, 106, the 1950 S.C.R. 852 report, and the 1955 11 S.C.R. 374, 381 decision to support this view. Subsequently, the Court referred to the decision in Ittyavira Mathai v. Varkey Varkey, where it was held that a question of limitation could not be raised in this Court because it was not a pure question of law but a mixed question of law and fact. The Court quoted the passage at page 911, stating that the appellants could have raised the limitation issue before the High Court when the decree was being confirmed, and that the High Court would have examined the record to determine whether the suit was filed within the prescribed period. The Court emphasized that the present point was not purely legal, that no specific ground concerning limitation had been raised in the appellant’s petition before the High Court, and consequently the Court declined to permit the appellant to raise the limitation question at this stage. The Court further noted that the High Court possessed a discretionary power to either allow or refuse the application and that such discretion should not be interfered with by this Court except for compelling reasons.

The Court then turned to the reasons supplied by the High Court for rejecting the application and explained why those reasons were not sufficient to deny the relief sought. It cited Rehmat‑un‑Nissa Begam v. Price, observing at page 66 that a discretionary order may be overturned only when the court acts capriciously or disregards any legal principle while exercising its discretion, while also acknowledging that this is not an exhaustive list of grounds for interference. In the present case, the Court found that the High Court’s order did not conform to the principle that a pure question of law may be raised at any stage of the litigation, even before the court of last resort. The Court observed that there was no evidence that the appellant had conceded before the Commissioner that mesne profits could be allowed up to the date of delivery of possession. No party had contested whether mesne profits could be awarded up to three years after the High Court decree or up to the later date when possession was delivered, as indicated by citations to A.I.R. 1964 S.C. 907 and L.R. 45 I.A. 61. Because no dispute on that point arose, there was no concession by the appellant, nor any election by the appellant to have the profits determined by the trial Court only up to the date of delivery of possession.

In this case the issue of delivery of possession could not have been raised because the parties did not dispute that point. At most it can be said that both the decree holder and the judgment debtor were under the impression, based on the High Court decree, that mesne profits were payable up to the date when possession was delivered. The appellant’s failure to object before the Commissioner or the trial Court does not signify that he consented to the calculation of mesne profits for the period extending beyond three years after the High Court decree, nor does it show that the trial Court’s order for payment of mesne profits up to the date of possession was based on any consent of the parties. Accordingly, the Court is not prepared to hold that the appellant’s omission to raise the point before the trial Court amounts to a waiver of his right to object under Order Twenty, rule twelve of the Code of Civil Procedure.

The decision in London, Chatham and Dover Railway Company v. South‑Eastern Railway Company is not applicable because its factual situation differs. In that case an agreement between two railway companies, executed under a parliamentary Act, contained a clause providing that any dispute between them would be referred to arbitration under the Railway Companies Arbitration Act of 22 and 23 Victoria chapter fifty‑nine. Section twenty‑six of that Act required all superior courts of law and equity in the United Kingdom to give full effect to any agreements, references, arbitrations and awards made under the Act, within the limits of their respective jurisdictions. This provision was interpreted as not removing the jurisdiction of ordinary courts, but as obliging the court to refrain from proceeding and to order withdrawal of the case if either party insisted that the dispute be resolved by arbitration in accordance with the agreement. The court rendered its decision while an appeal challenging the validity of the agreement was pending before the House of Lords. Although not expressly stated, it may be inferred that one of the questions in that appeal concerned whether the court’s jurisdiction was ousted when the agreement was deemed valid. However, the House of Lords and the Court of Appeal did not decide that issue; as noted on page one hundred and one, their Lordships expressly observed that their judgments only determined that the High Court of Justice possessed jurisdiction to examine the validity of the agreement, and did not address whether disputes arising under the agreement should be adjudicated by arbitration.

The parties requested that the trial of the action be postponed on the basis that certain issues, other than the question of whether the Court’s jurisdiction had been ousted, were pending before the House of Lords for decision. The Court rejected that request. Consequently, the parties proceeded with the trial and a judgment was rendered by the Court based on the evidence concerning the dispute between them. In the subsequent appeal, the appellants contended that the Court lacked authority to try the matter because it could be decided only by arbitration. The appellate Court held that the trial Court retained its jurisdiction to determine the disputed matters where neither party had insisted on arbitration, and that the parties should not be permitted to raise a jurisdictional objection at that stage. The reasoning quoted from Cotton, L.J., at page 105, explained that a party who could have insisted that the Court refrain from considering the merits, but chose not to do so, loses the right to later object to jurisdiction and is consequently defeated on the merits; therefore it is too late to assert a jurisdictional objection before the appellate Court if it was not raised properly and timely. In the present case, the appellant did not allow the trial Court to decide the question of the period up to which mesne profits could be awarded, because he raised no dispute on that issue. He did not gamble that the judgment might be rendered in his favour, and his attempt to raise the question in the High Court was not intended to circumvent a judgment that happened to be adverse to him. The Commissioner conducted an inquiry into mesne profits for the period from 29 August 1946 to 4 December 1947. Suits for mesne profits covering the interval from 7 March 1941 to 28 February 1943 could not be instituted in August 1946, as the three‑year limitation period for bringing an action for mesne profits for those years had already expired. Accordingly, even if the appellant had objected that mesne profits could not be decreed for any period after 7 March 1941, the decree‑holder respondent would have been unable to sue for recovery of those profits because the statutory limitation had barred such actions, and therefore the respondent could not have been prejudiced by the appellant’s later raising of this ground at the appeal hearing. The appellate Court therefore concluded that the High Court erred in refusing to permit the appellant to present this additional ground. The central issue for determination on appeal is whether mesne profits may be awarded to the decree‑holder for any period extending beyond the expiry of three years from the date of the High Court’s decree, that is, for any time after 7 March 1941.

The case turned on whether mesne profits could be awarded for a period that began after March 7 1941, which marked the expiration of three years from the date of the High Court’s decree. The judgment‑debtor argued that such awards were barred by the provisions of Order 20, rule 12 of the Code of Civil Procedure, which provides that “12. (1) Where a suit is for the recovery of possession of immovable property and for rent or mesne profits, the Court may pass a decree‑ (a) for the possession of the property; (b) for the rent or mesne profits which have accrued on the property during a period prior to the institution of the suit or directing an inquiry as to such rent or mesne profits; (c) directing an inquiry as to rent or mesne profits from the institution of the suit until‑ (i) the delivery of possession to the decree‑holder, (ii) the relinquishment of possession by the judgment debtor with notice to the decree‑holder through the Court, or (iii) the expiration of three years from the date of the decree, whichever event first occurs. (2) Where an inquiry is directed under clause (b) or clause (c), a final decree in respect of the rent or mesne profits shall be passed in accordance with the result of such inquiry.” The judgment‑debtor urged that the direction contained in the decree, which called for an inquiry into mesne profits up to the date of delivery of possession, should be interpreted to mean an inquiry either up to the date of delivery of possession or up to three years from the date of the decree, whichever occurs earlier, because that construction would bring the decree into conformity with the statutory rule. In support of this view, reference was made to the decision in Girish Chunder Lahiri v. Shoshi Shikhareswar Roy and to other cases that have followed that precedent. The decree‑holder, on the other hand, contended that the preliminary decree expressly directed the inquiry into mesne profits from the date the suit was instituted up to the date possession was delivered, and that this direction could not be disregarded when the court later inquired into mesne profits or passed a final decree, even if the direction did not fully align with the wording of rule 12, Order 20. The decree‑holder also maintained that the judgment‑debtor was estopped from claiming that he was not liable for mesne profits accruing after March 7 1938, on the basis that his conduct amounted to a consent to the award of mesne profits for the period after that date. The Court had previously held that the appellant’s conduct did not amount to such consent for mesne profits after March 7 1941. The Court further observed that, apart from rule 12 of Order 20, there was no other statutory provision that empowered a court to decree mesne profits for a period extending beyond the institution of a suit for recovery of possession of immovable property and mesne profits.

It was not contested by the respondent who held the decree that Rule 12 of Order 20 does not give a Court the authority to order an inquiry and then issue a final decree regarding mesne profits for a period that exceeds three years from the date on which the decree is made. The wording of the rule makes this limitation unmistakable. The remaining issue, therefore, was whether a decree that either omits any reference to a specific period for the payment of mesne profits or merely states that such profits are payable until possession is delivered should be interpreted as an instruction that mesne profits will be awarded for a period of three years from the decree, to the extent that possession has not been delivered within that time frame. The case law that was examined supported the position of the appellant. The essential reasoning was that the Court lacked the power to issue a decree that contravened the explicit provisions of Rule 12, Order 20, and consequently the decree needed to be read in a manner consistent with those provisions. Although the legal rules governing decrees for mesne profits have evolved over time, the terminology used in a decree to describe the period for which mesne profits are to be awarded has consistently been treated as a matter of statutory construction, interpreted according to the law that was applicable at the relevant moment. Under Sections 196 and 197 of the Code of Civil Procedure of 1859, a decree for mesne profits could be ordered when a suit concerned land or any other property from which rent was payable. Section 196 allowed the Court to direct that mesne profits or rent be paid from the date the suit was filed until the date possession was handed over to the decree‑holder, with interest at a rate the Court deemed appropriate. This provision shows that the Court’s duty was not limited to merely directing an inquiry about mesne profits and then issuing a decree, as required by later statutes, and it placed no upper limit of three years on the period for which mesne profits could be decreed; rather, mesne profits could be awarded up to the moment possession was delivered. In the case of Fakharuddin Mahomed Ahsan Chowdhry v. Official Trustee of Bengal, the High Court decree granted the plaintiff possession of the land described in the kabinnama together with the right to wasilat (mesne profits) from the beginning of Samvat 1267, but it did not expressly state how long the wasilat were to be paid. The plaint itself was also ambiguous about the claimed period. The Privy Council therefore interpreted the decree as awarding mesne profits up to the date possession was actually delivered, deeming that to be the reasonable construction of the decree.

The Court explained that to achieve the legislature’s purpose of avoiding unnecessary litigation and multiplication of suits, the decree should include the wasilat that is claimable up to possession. Section 211 of the Code of Civil Procedure, 1882 (Act XIV of 1882) stipulated that mesne profits could be decreed either until delivery of possession or for three years after the decree, whichever occurred first. Consequently, the statutory amendment limited the Court’s authority to award mesne profits to a maximum of three years measured from the date of the decree. In Girish Chunder’s Case (2) the Privy Council examined a decree for mesne profits that had been issued while Section 211 was operative. That decree, originating in 1883, expressly provided that the holder of the decree would receive mesne profits for the entire period of dispossession. Actual possession of village N was not obtained until 1892, creating a gap of more than three years between the decree and the delivery of possession. The trial court initially allowed mesne profits for village N up to the date of delivery of possession, relying on the language of the decree. However, the High Court disagreed and limited the award to only three years after the decree, invoking the limitation contained in Section 211. The High Court’s reasoning was recorded at page 126, stating that awarding mesne profits beyond three years contravened Section 211 and was therefore unauthorised. The principle articulated in that case—that a decree for mesne profits must be interpreted within the three‑year limit unless possession occurs earlier—was subsequently adopted by several High Courts. Those courts held that the judiciary possessed no authority to grant mesne profits for a period extending beyond three years from the decree date. Consequently, the decree should be interpreted as subject to the condition that if possession is not delivered within three years, the mesne profits are limited to that three‑year period. These interpretations applied both to decrees that omitted any specific time frame for payment of mesne profits and to those that expressly limited payment to the time of delivery of possession. In Venkata Kumara v. Subbayamma (1), Uttamram v. Kishordas (2) and Trailokya v. Jogendra (3), courts noted that decree specified commencement date of period for which mesne profits were to be assessed. The judgments also observed that when the decree failed to state the ending point of the mesne profit period, the court could interpret the decree to conform with the statutory limitation. It may be argued, as urged on behalf of the respondent, that the courts possessed the discretion to interpret a decree when its language did not expressly indicate the other terminus of the period. Thus, the courts could determine the ending point for mesne profits based on the statutory framework.

In the earlier discussion it was observed that a decree could be interpreted to limit mesne‑profit claims to a three‑year period when possession was not delivered within that time. That observation, however, did not apply to the decision in Girish Chunder’s case, reported in L.R. 27 I.A. 110. In that case, the decree expressly provided that the holder of the decree would be entitled to mesne profits for the entire period of dispossession. In the same way, the decisions in Godayarti Raja v. Ramachandraswami (A.I.R. 1943 Mad. 354), Narayan v. Sono (I.L.R. 24 Bom. 345), Kunwar Jagdish Chandra v. Bulaqi Das (I.L.R. [1959] 1 All. 114) and Kanai Lal v. Shvam Kishore (I.L.R. 1959 Cal. 76) each contained decrees that allowed mesne profits for the whole period of dispossession. None of those decrees can be described as vague or incomplete, because their meaning was clear and unambiguous. Nevertheless, in each of those cases the courts interpreted the decrees so as to bring them into conformity with the rule laid down in Order 20, Rule 12(1)(c) of the Code of Civil Procedure, as explained in the authorities cited earlier. The courts did not reshape the language because the expressions for mesne profits were unclear; rather, they did so because a decree that fixes future mesne‑profit liability or orders an enquiry into such liability is not the result of a determination of any dispute between the parties. Instead, it is issued by the court exercising the discretionary power granted by Order 20, Rule 12(1)(c). The court is required to exercise that power in accordance with law, and consequently a decree that either orders mesne profits for the period of dispossession or directs an enquiry until possession is delivered is to be understood as limiting the entitlement to mesne profits to three years from the date of the decree, if possession is not delivered within those three years. This limitation was introduced to prevent the filing of multiple suits by a decree‑holder against a judgment‑debtor for mesne profits that the decree‑holder could otherwise claim. At the same time, the three‑year ceiling was intended to discourage decree‑holders from unnecessarily delaying possession. If a decree‑holder fails to act promptly in enforcing the decree, he must either relinquish any claim to mesne profits beyond the three‑year period or commence separate litigation to recover those amounts. The Privy Council, in deciding Girish Chunder’s case, did not base its order on any allegation that the decree was vague or incomplete; it simply held that a decree granting mesne‑profit entitlement for a period longer than three years was not authorized by section 21 of the Code of Civil Procedure, 1882. Accordingly, this Court is of the view that it is permissible for a court to interpret a direction contained in a preliminary decree concerning an inquiry into future mesne profits, even when that direction does not expressly enumerate all the alternatives provided for in Order 20, Rule 12(1)(c), and to hold that

In this case, the Court observed that the decree should be interpreted in accordance with the provisions of Order 20, Rule 12(1)(c) of the Code of Civil Procedure. The Court noted that the decree‑holder respondent argued that the trial Court could not have disregarded the terms of the preliminary decree when it passed the final decree because no appeal had been filed against the preliminary decree, and because Section 97 of the Code of Civil Procedure provided that a party aggrieved by a preliminary decree after the commencement of the Code, who did not appeal, would be barred from contesting its correctness in any appeal that might be preferred from the final decree. The Court explained that the purpose of Section 97 was to prevent the parties from reopening issues that had already been raised and decided by the Court at the stage of the preliminary decree, and that such issues would be deemed finally decided if no appeal had been lodged against the preliminary decree. However, the Court held that the provisions of Section 97 were not applicable to the present case. The preliminary decree, according to the Court, had merely directed an inquiry into the mesne profits from the date the suit was instituted up to the date possession was delivered to the decree‑holder. The decree‑holder could not have been aggrieved by that order, and the judgment debtor could not have insisted that the Court detail all the various alternatives mentioned in Order 20, Rule 12(1)(c), nor could he have expected that possession would necessarily be taken within three years of the decree. The Court further observed that the direction concerning the enquiry into future mesne profits did not constitute an adjudication of any controversy between the parties, nor did it refer to any cause of action that had arisen in favour of the plaintiff‑decree holder before the suit was filed. The direction had been issued under the special power conferred on the Court by Order 20, Rule 12(1)(c), which allowed the Court, if it considered it appropriate, to make such a direction. The Court emphasized that it was within its discretion either to give or to withhold that direction, and that when the Court made the direction it did not determine the period for which the decree‑holder would be entitled to mesne profits; consequently, no point concerning that period could be raised at that stage. The judgment debtor’s liability to pay mesne profits arose under ordinary law, and a separate suit for recovery of mesne profits could be filed by the decree‑holder. The provisions of Order 20, Rule 12(1)(c) were intended only to avoid the multiplicity of suits and the consequent harassment of the parties. The Court further stated that the mere inclusion of a direction for an enquiry into mesne profits in a preliminary decree did not make it part of “the decree” against which an appeal could be filed. An appeal could be filed only after a final decree was passed, wherein a specific amount of mesne profits would be decreed in favour of the decree‑holder. Accordingly, the question of the proper period for which mesne profits should be decreed would arise for determination at the time the final decree was made, by which stage the parties would be able to ascertain the exact period for future mesne profits in view of Order 20, Rule 12(1)(c). The Court concluded that the direction in the preliminary decree could not operate, under Section 11 of the Code of Civil Procedure or general principles, as res judicata, because the direction was not based on a decision of any matter in controversy between the parties but was issued in exercise of the Court’s power under Order 20, Rule 12(1)(c). For the same reason, the principle that a Court’s final decision, even if erroneous, must be respected, did not apply. Accordingly, the Court held that the judgment‑debtor appellant was not bound by the direction in the preliminary decree regarding mesne profits.

In this case, the Court observed that the question of the period for which mesne profits could be decreed could be decided only when the final decree was passed, because only at that stage would the parties be in a position to know the precise period for future mesne profits in accordance with Order 20 rule 12(1)(c). The Court held that a direction contained in a preliminary decree could not operate as res judicata under Section 11 of the Code of Civil Procedure or any general principle, since that direction was not based on any adjudicated dispute between the parties but was issued in the exercise of the power vested in the Court by Order 20 rule 12(1)(c). For the same reason, the doctrine that a court’s decision, whether correct or erroneous, becomes binding once it is final does not apply to these directions. Consequently, the Court concluded that the appellant, who was the judgment‑debtor, was not barred from arguing that mesne profits should not be awarded for a period exceeding three years from the date of the decree. The Court then examined the statutory requirement of Rule 12 of Order 20, which obliges the Court, at the time of passing a preliminary decree, to order an inquiry into mesne profits covering the period from the institution of the suit until either the property is actually delivered to the decree‑holder, three years elapse from the date of the decree, or whichever of these events occurs first. At the moment the preliminary decree is passed, the Court cannot ascertain which of these three alternatives will ultimately determine the period for which mesne profits are payable to the decree‑holder. Therefore, the Court must either repeat the three alternatives in the wording of the final judgment and the subsequent decree, or interpret the judgment and decree so that they are read in conformity with the provisions of clause (c) of sub‑rule (1) of Rule 12. The Court expressed a preference for the latter approach, noting that it is better to construe the decree in accordance with the statutory language rather than to require a mechanical repetition of the clause in the final document. The Court also recognized that in some cases the inquiry into mesne profits may be completed before the three‑year period expires, yet the final decree may be issued later, still without actual delivery of possession. In such circumstances it would be unreasonable to allow the judgment‑debtor to claim that the final decree is defective because it does not explicitly state that, if possession is not delivered within three years, mesne profits will be payable only for the three‑year period from the date of the decree. Accordingly, the Court found that it would not be desirable to delay the issuance of the final decree until either possession is delivered or the three‑year period has elapsed.

In this case the Court observed that it would be inappropriate to delay the issuance of the final decree until either the possession of the land was actually delivered or the three‑year period prescribed after the decree had elapsed. The Court also highlighted a potential injustice that could arise if the decree‑holder, by his own neglect, failed to take possession for a period exceeding three years after the decree was made, especially where the decree either failed to specify the duration for which mesne profits could be claimed or merely stated that such profits would be payable until possession was delivered. The law, the Court noted, did not envisage such a situation and therefore provided a clear maximum period—three years from the date of the decree—during which mesne profits could be claimed by the decree‑holder. The Court referred to the precedent set in Kunwar Jagdish Chandra v. Bulaqi Das (I.L.R. [1959] 1 All. 114) to support this principle. Consequently, the Court held that a decree issued under rule 12 of Order 20 of the Code of Civil Procedure, which directs an inquiry into mesne profits, must be interpreted as conforming to the requirements of rule 12(1)(c) of the same Order. Accordingly, the decree‑holder in the present matter could not claim mesne profits for any period after 7 March 1941, the date on which the three‑year period following the High Court’s decree expired. The Court then turned to another issue raised by the appellant, namely that the High Court had arbitrarily fixed a higher amount of mesne profits than that adjudged by the trial Court, which itself had arbitrarily increased the amount suggested by the Commissioner. The respondent argued that even though the High Court gave no explicit reasons for fixing a higher rate, a presumption should arise that the Court had considered the material before deciding, and therefore its determination could not be termed arbitrary. The Court found it necessary first to examine whether the High Court had indeed provided adequate reasons for fixing a higher rate. It concluded that the High Court had not seriously engaged with the question of appropriate mesne profits. The Court observed that the High Court varied the rates in most instances without stating reasons for holding the Subordinate Judge’s findings on the quantum of mesne profits to be erroneous. Moreover, the High Court failed to account for the period of economic depression when assessing mesne profits. The Commissioner had divided the seventeen‑year span from September 1926 to March 1943 into three distinct periods—1926‑1930, 1931‑1940 and 1941‑1943—recognising that 1931‑1940 was a depression era and that commodity prices rose in the later period due to World War II. The trial Court had initially fixed a normal rate for the first and last periods and had made an allowance for the depression period by applying a lower rate for the ten‑year span of 1931‑1940. The High Court, however, overlooked this nuanced calculation, applying a single rate for 1926‑1940 and a different rate for 1941‑1943, thereby disregarding the long depression period and resulting in an award of mesne profits substantially higher than that fixed by the trial Court.

In light of the foregoing considerations, the Commissioner determined that the profit rate applicable to the land should vary according to each of the three distinct periods. The trial court initially established a normal rate that it deemed adequate for the first period (1926‑1930) and for the final period (1941‑1943). It then recognized the economic depression that prevailed from 1931 to 1940 and consequently reduced the mesne‑profit rate for that ten‑year interval. The High Court, however, failed to notice that the trial court had applied a lower rate for the depression years. Instead, the High Court imposed a single uniform rate for the entire span from 1926 to 1940 and a different rate only for the years 1941 to 1943, thereby disregarding the prolonged period of depression. Because of this oversight, the mesne‑profit assessment ordered by the High Court turned out to be substantially higher than the amount fixed by the trial court. Had the High Court taken account of the trial court’s lower rate for the depression years, the disparity between the two calculations would have been far smaller, possibly amounting to roughly Rs 2,000 plus a corresponding adjustment in interest. The trial court’s approach was noted only near the end of its judgment, specifically at paragraph 25, and appears to have been missed by the appellate judges. To illustrate the trial court’s reduced rates for the 1931‑1940 period, the subordinate judge allowed the following profit amounts per acre: for items numbered 1, 4, 8 and 12 the rate was Rs 35; for item 9 pertaining to garden produce the rate was Rs 50; for items 10 and 11 the rate was Rs 10; for items 18 to 20 the rate was Rs 30; and for the remaining items of the A‑Schedule there was no change in the rates. Moreover, the High Court set the profit for item 9 of the A‑Schedule at a level exceeding even the claimant’s own demand. While the trial court had fixed the annual profit at Rs 50, the High Court declared that amount too low and increased it to Rs 100 per year up to 1940 and to Rs 150 for the years 1941‑1943. The Commissioner’s report shows that the plaintiff originally claimed Rs 150 per acre for the mango grove up to 1940 and Rs 200 per acre thereafter, which translates to an annual claim of about Rs 94 for the earlier period and Rs 126 for the later period on an area of 0.63 cents. Consequently, the High Court’s award of Rs 100 and Rs 150 per year exceeded the claimant’s own stated claim.

In respect of item No. 9 of the A‑Schedule, the land measured.63 cents and the plaintiff, as decree‑holder, had asserted mesne profits of about Rs 126 per year for the period after 1940. The High Court, however, fixed the annual mesne profit at Rs 100 up to 1940 and at Rs 150 for the years 1941‑1943, thereby awarding an amount that was higher than the plaintiff’s own claim. The Court noted that it could not be justified in granting mesne profits greater than those claimed by the decree‑holder. The third point of contention concerned the High Court’s findings on items Nos. 10 and 11, which were pasture lands. The Commissioner had suggested mesne profits of Rs 10 per acre and reported that the tax payable on item No. 10 was Rs 6 per acre and on item No. 11 was Rs 5 per acre. The Subordinate Judge, taking the Commissioner’s suggestion into account, fixed mesne profits at Rs 10 for the.95‑acre area and fixed the proper tax for these items at Re 1. The High Court then raised the mesne profit rate to Rs 20 for the period up to 1940 and to Rs 30 for the subsequent period, while confirming the tax finding of Re 1. In doing so, the High Court appeared confused, because its justification for increasing the profits rested on the assertion that the tax on these items was Rs 5, as reflected in its statement: “He (the Subordinate Judge) confirmed the finding of the Commissioner in this behalf. The Commissioner gives no reasons as to how he fixed the profits at Rs 10 for the items. It is stated that the tax paid on the land is Rs 5. We are inclined to think that it would be proper to fix Rs 20 for the items up to 1940 and Rs 30 for 1941 to 1943. The tax of Re 1 deducted by the Subordinate Judge is confirmed.” When the High Court finally accepted the Subordinate Judge’s determination that the tax should be Re 1, the basis for raising the mesne profit amount disappeared. Another aspect involved item No. 12, which comprised dry land. The Subordinate Judge had calculated mesne profits for this item at Rs 35 per acre. The High Court increased this amount to Rs 50 per acre, apparently on the ground that garden crops could be cultivated on the land, as it expressed: “The learned Subordinate Judge stated in paragraph 18 that garden crops could be grown on the surrounding lands.” This summary was not precise. In paragraph 18 the Subordinate Judge actually recorded that the Commissioner had fixed profits for the item at Rs 30 per acre per year, consistent with other dry lands, and that the Judge himself was fixing profits at Rs 35 per acre, following the same approach for other dry lands. He further referred to the Commissioner’s observation that evidence showed garden crops were being raised on the surrounding lands and that there was no reason to conclude that such crops were not raised on this particular item. The Subordinate Judge, however, did not base the rate on the possibility of garden crops being grown, but on the classification of the land as dry land.

The Court observed that the determination of the rate for the land in question was not based on the possibility that garden crops could be be cultivated there, but rather on the premise that the land was dry. It further noted that the Commissioner likewise did not appear to have fixed the rate on the assumption that garden crops might be raised on the same parcel of land. Proceeding from this point, the Court turned its attention to the manner in which the High Court had dealt with the various items of property listed in Schedules A and C. The purpose of this review was to demonstrate that the modifications made by the High Court to the rates were unsupported by any substantive material on the record. The Court therefore examined the items in the exact sequence in which the High Court had considered them.

With respect to Schedule A, Items numbered 13 through 17, the Subordinate Judge had originally fixed the rent for the houses at four rupees per month. The High Court, however, increased this amount to six rupees per month, offering only the brief observation that “We are inclined to think that the rent of Rs. 6 per month might be fixed in regard to these items.” The Court then reproduced the Subordinate Judge’s own justification for fixing the rent at four rupees, which stated that the Commissioner had fixed mesne profits at two rupees per month, that the Union tax on the house amounted to Rs. 6‑4‑0 per year, and that the annual tax roughly equated to two months’ rent. The Judge reasoned that the tax could serve as a reasonable basis for fixing mesne profits, and consequently that the Commissioner’s rate was too low, prompting the fixation of profits at four rupees per month. Regarding Items numbered 1, 4 and 8, the Subordinate Judge had set the actual profits for the land at thirty‑five rupees per acre. He relied on evidence that land and makta prices had risen about ten years after the death of China Bapanna in 1915, and that, according to exhibits P‑10 and P‑11, the rent realized by dry lands was thirty rupees per acre. The Judge concluded that fixing profits at thirty‑five rupees per acre from 1925 onward was neither unreasonable nor excessive, especially in view of price increases following the 1918 war, whereas the Commissioner had fixed the rate at thirty rupees. The High Court subsequently reduced the profit rate to thirty rupees per acre for the period up to 1940, and then raised it to sixty rupees per year for the period from 1941 to 1943, stating that “The learned Subordinate Judge increased the rent from Rs. 30 to Rs. 35 without giving any.”

The Court observed that, for each of the three specified items, the appropriate profit rate should have remained at Rs 30 per year for the period ending in 1940. Because market prices rose after 1940, the Court further held that the same three items could justifiably be assessed at Rs 60 per year for the years 1941 to 1943. The Court found that the High Court was mistaken in asserting that the Subordinate Judge had offered no reasons for increasing the rate suggested by the Commissioner. In fact, the Court noted that it was the High Court itself that had failed to explain why it lowered the rate to Rs 30 up to 1940 and then doubled it from 1941 onward. Regarding items numbered 9, 10, 11 and 12, the Court reiterated its earlier analysis showing that the High Court erred by raising the profit rates for those items. For items 18 to 20, the Commissioner had initially recommended a profit of Rs 30 per year, a recommendation that both the Subordinate Judge and the High Court accepted for the period before 1940. Nevertheless, the High Court increased the rate to Rs 60 per year for 1941‑43, merely stating that it deemed such a rate reasonable for those years. Concerning items 2, 3, 5, 6 and 7, the High Court affirmed the Subordinate Judge’s findings for the pre‑1940 period but fixed the rate per bag at Rs 10 for 1941‑43, explaining that the increase reflected higher prices after 1940. In Schedule C, the Commissioner allowed profits of Rs 30 per acre, consistent with the treatment of dry lands, while the Subordinate Judge had set Rs 35 per acre on the same basis as for dry‑land items 1, 4 and 8 of Schedule A. The High Court reduced this amount to Rs 30, relying on lease documents exhibited as P‑10 and P‑11 of 1915, but it disregarded the statement in RW‑26, considered by the Subordinate Judge, that rents had been rising since 1925. Having considered the foregoing, the Court concluded that it could not accept the High Court’s view that the Subordinate Judge’s profit rates were incorrect, nor could it endorse the High Court’s decision to raise the rates for most items in Schedules A and C, especially for the period from 1926 to 1940. Consequently, the Court identified two possible courses: either set aside the decree concerning mesne profits and remit the matter to the lower court for a fresh determination of the quantum, or overturn the High Court decree and reinstate the Subordinate Judge’s decree with respect to

The Court considered the amount of mesne profits that should be awarded up to 7 March 1941. It noted that the mesne profits granted against the appellant covered the period from 1926 to 1943, and that ordering another inquiry into mesne profits would delay the issuance of a final decree on that point. In light of this observation, counsel for the appellant, without prejudice, expressed that his client was prepared to accept the calculation of mesne profits at the rate fixed by the trial Court and to abide by the decree for mesne profits issued by that Court. By contrast, counsel for the decree‑holder respondent indicated that his client would prefer that the High Court make a fresh determination on the issue if the present Court found that the High Court had not been justified in increasing the amount of mesne profits. The respondent was regarded as being more interested in obtaining an early finalisation of the mesne profits than the appellant. Accordingly, the Court ordered that it would follow the respondent’s wish. It therefore allowed the appeal, awarded the costs of this Court, set aside the decree of the lower Court, and remanded the matter to the High Court. The High Court was directed to determine anew the quantum of mesne profits up to 7 March 1941, the date when the three‑year period from the preliminary decree of the High Court expired, and to dispose of the appeal in accordance with law.

Judge Mudholkar noted that the present appeal originated from a judgment of the High Court of Andhra Pradesh, which itself arose out of a suit for possession and mesne profits instituted in 1926. The trial Court had dismissed the suit, but on appeal the High Court of Madras had passed a decree in favour of the second plaintiff, who is the first respondent before this Court, on 7 March 1938. The decree of the High Court, with respect to mesne profits, was a preliminary decree. In that decree the High Court directed that the lower court should conduct an inquiry into mesne profits from the date the suit was instituted and thereafter pass a final decree for payment of any amount found due up to the date possession was delivered to the second plaintiff. No further appeal was taken by the first respondent, who is now the appellant, against that decree. Respondent No 1 subsequently obtained delivery of possession of part of the property in 1943 and of another portion on 1 January 1948. Following an application by Respondent No 1, the court of first instance appointed a Commissioner to investigate the mesne profits. After reviewing the Commissioner’s report, the court issued a final decree granting a specified sum to Respondent No 1. In its judgment the court observed, “So far as the A and C schedule properties are concerned, there …”

There was no dispute about the need to calculate mesne profits for a period of seventeen years, that is, from 1926 to February 1943 for the A and C schedule properties, and for the B schedule properties up to the year 1946. The only controversy concerned the amount of the profits, not the time periods to be taken into account. The appellant filed an appeal against the final decree in the High Court of Madras, and the appeal was later transferred to the High Court of Andhra Pradesh. In the appellant’s memorandum of appeal he did not put forward any argument that mesne profits could not be awarded for a period longer than three years from the date of the preliminary decree. He also omitted that issue in his counter‑affidavit responding to respondent No. 1’s application for the appointment of a Commissioner to determine mesne profits, and he did not raise it before the Commissioner. Conversely, both the Commissioner and the Subordinate Judge conceded that accounts could be taken up to the year 1943 for the properties described in Schedules A and C of the plaint and up to the year 1946 for the properties described hi Schedule B of the plaint. For the first time when the appeal was argued before the High Court of Andhra Pradesh, the appellant contended that, pursuant to the provisions of O.XX, r. 12, respondent No. 1 was not entitled to claim mesne profits for more than three years after the preliminary decree.

The High Court observed that the appellant had not raised any dispute previously and had elected to have the profits determined by the subordinate judge up to the date of delivery of possession, and therefore it was reluctant to permit a new ground of appeal. The Court said, “As the appellant raised no dispute and elected to have the profits determined by the subordinate Judge up to the date of delivery of possession we are not inclined to permit the appellant to raise this new ground of appeal.” Nevertheless, because the High Court’s decision was subject to further appeal, the Court heard the parties on the newly raised ground and decided against the appellant. At the same time, the High Court considered a cross‑objection filed by the first respondent, who sought an enhancement of the mesne‑profit amount. The High Court dismissed the appellant’s appeal, partially allowed the respondent’s cross‑objection, and accordingly modified the final decree. After granting a certificate to the appellant, the matter came before this Court. The appellant urged two points before us: first, that respondent No. 1 should not receive mesne profits for a period exceeding three years from the preliminary decree; and second, that the High Court erred in increasing the amount of mesne profits. In addition to this appeal, we have also heard an appeal preferred by the respondent, which is a cross‑appeal.

In this case the appellant had relied on a petition dated 926 of 1963 in which he sought a further enhancement of the mesne profits. The author of the judgment read the opinion of the senior colleague, Justice Raghubar Dayal, who had concluded that the High Court erred in refusing the appellant leave to raise a new ground at the argument stage, and that after the new ground was permitted the High Court had subsequently upheld it. Regarding the second ground, Justice Dayal observed that the High Court was not correct in increasing the amount of mesne profits and suggested that the matter should be sent back to the High Court for a fresh determination on that issue. He also expressed the view that the cross‑appeal filed by the respondent ought to be dismissed.

The present judge, however, was of the clear opinion that the High Court acted correctly in refusing the appellant permission to introduce a new ground during the hearing. The judge noted that the appellant had neither raised the question in the memorandum of appeal nor contested the Commissioner’s enquiry into mesne profits, which had been allowed to cover a period longer than three years from the date of the decree, and the appellant had taken part in that enquiry. To explain why a new ground should not be permitted at the hearing, the judge quoted Lord Birkenhead’s statement in Wilson v. United Counties Bank Ltd. (1920) A.C. 102, 106, which emphasizes that detailed grounds of appeal enable the opposing parties to know precisely the case they must meet, that un‑set‑forth contentions are treated as abandoned, and that, except in exceptional circumstances, parties should apply for the court’s indulgence before adding new grounds, as such practice is highly inconvenient and should be discouraged. The judge further observed that the discretion to grant or refuse permission to raise a new ground lies with the High Court, and that the High Court had provided cogent reasons for its refusal, indicating that it had not acted arbitrarily. The High Court’s judgment stated that the original grounds of appeal contained no objection to the period for payment of mesne profits, and that before the appeal was taken up the appellant had sought to …

In this appeal, the appellant sought to introduce an additional ground, namely that the Subordinate Judge did not have authority to award mesne profits for a period exceeding three years from the date of the decree issued by the High Court. The Court noted that this question had never been raised in the counter‑affidavit filed as Interlocutory Application No. 558 of 1945 on the Subordinate Judge’s docket in Eluru, nor before the Commissioner, nor before the Subordinate Judge himself. By contrast, both the Commissioner and the Subordinate Judge had previously conceded that accounts could be taken up to the year 1943 for properties listed in Schedules A and C, and up to 1946 for properties listed in Schedule B. The Court observed that this was the first occasion on which the objection, grounded in Order XX Rule 12 of the Code of Civil Procedure, was being raised before this Court. The Court further explained that, had the objection been raised earlier in the counter‑affidavit or before the Commissioner, the second plaintiff would have been entitled to institute a separate suit for the recovery of mesne profits beyond the three‑year limit, extending up to the date of actual possession. Since the appellant did not dispute the amount of profits and had accepted that the Subordinate Judge would determine the profits only up to the date of delivery of possession, the Court expressed its reluctance to allow the appellant to rely on this newly raised ground of appeal.

The Court then warned that permitting such a new ground would conflict with established precedents, including the Privy Council decision in Rehmat‑un‑Nisa Begum v. Price and a recent Supreme Court judgment in lttyavira Mathai v. Varkey Yarkey. Referring to the earlier case, the Court quoted the observation made in column 2, page 911: “It would thus be clear that the appellant has not raised a sufficiently clear plea of limitation by stating relevant facts and making appropriate averments. It is apparently because of this that the trial court, though it did raise a formal issue of limitation, gave no finding thereon. Nothing would have been simpler for the trial court than to dismiss the suit on the ground of limitation if the plea was seriously raised before it. Had the point been pressed, it would not have been required to discuss in detail the various questions of fact pertaining to the merits of the case before it could dismiss the suit.” The Court added that, in the present plaint, the respondents alleged that the limitation period began on 15‑02‑1113, the date when the High Court dismissed the respondents’ revision petition. The appellant, however, failed to argue that, under Article 47 of the Limitation Act, the limitation period should be computed from the date of the original order rather than from the revisional order. The Court noted that, had the appellant made such a contention, the respondents would likely have amended the plaint to record the date of its institution in the Munsiff’s Court, which could have affected the timeliness of the suit.

In the circumstances, the Court observed that if the limitation period had been computed from the date of the original order rather than the revisional order, the suit would have been filed within the prescribed time. Specifically, the suit would have been timely on 4‑3‑1118 when the plaint was presented to the District Court. The Court further noted that the appellants could have raised the issue of limitation before the High Court in support of the decree that the trial court had rendered in their favour. Had they made such an objection, the High Court would have examined the records to determine whether the suit was filed within the period of limitation, as contemplated in the authorities cited, namely 45 I.A. 61 and A.I.R. 1964 S.C. 907. The matter now before this Court was not a pure question of law; rather, it involved a mixed question of fact and law. The appellant’s petition to the High Court seeking a certificate on the ground that the suit was time‑barred did not specify any particular ground for that claim. Consequently, the Court declined to permit the appellant to raise the limitation issue at this stage.

The Court explained that permission to raise a new ground was refused for two independent reasons. First, the appellant had failed to articulate a clear plea in its written statement. Second, the issue was a mixed question of fact and law, which the Court is reluctant to decide at the appellate stage without a proper factual record. The Court recalled the decision in Yeswant Deorao Deshmukh v. Walchand Ramchand Kothari, where it had approved a passage from Connecticut Fire Insurance Co. v. Kayanagh stating that a novel question of law may be entertained in a court of last resort when the facts are settled, but that such a course is doubtful when deciding the question would require resolving factual disputes. In the present case, a question of limitation had indeed been raised before the lower court, and the appellant was seeking to invoke section 18 of the Limitation Act. The Court had previously rejected that plea because the necessary facts were not established, rendering the earlier approval of Lord Watson’s view merely obiter. Finally, the Court emphasized the principle that a party who fails to object to a direction in the lower court’s judgment is deemed to have waived that objection and cannot, for the first time on appeal, challenge the lower court’s authority to issue the direction.

In the case of Dover Railway Co. v. South Eastern Railway Co., all the Lords Justices of the Court of Appeal emphatically held that an omission of the type to which the appellant in the present matter is guilty must be regarded as a waiver, even of a plea of jurisdiction. The citations for the authorities are (1) [1950] S.C.R. 852, (2) [1892] A.C. 473 and (3) [1889] 40 Ch. D. 100, 106‑109. The dispute concerned an agreement between two railway companies that required every difference between them to be referred to arbitration under the Railway Companies Arbitration Act. Section 26 of that Act obliged a court, when one of the parties insisted on the agreement, to give effect to the arbitration clause and to act in accordance with it regarding the submission to arbitration. In the trial court the defendant raised the arbitration agreement as a defence, while the plaintiff challenged the validity of the agreement and also questioned whether the court possessed the competence to adjudicate that validity. The trial judge decided in favour of the plaintiff and that decision was affirmed by the Court of Appeal. The defendant then appealed to the House of Lords. While the appeal was pending, the matter was heard before Justice Kekewich. One of the issues before the House of Lords was whether, assuming the arbitration agreement was valid, the jurisdiction of the Court was ousted. The defendant applied for a postponement of the action, arguing that certain other points decided by the Court of Appeal and now before the House of Lords would be material. However, the application failed to state that the jurisdictional question was also pending before the House of Lords, nor did it argue that the trial should be stayed until that question was finally resolved. Consequently, the trial proceeded and a judgment was rendered on the basis of the evidence. When the case returned to the Court of Appeal, the defendant contended that the Court lacked jurisdiction to consider the merits of the case. In rejecting that contention, Lord Justice Cotton observed that the defendants had not indicated, while the House of Lords decision was pending, that they wished to keep the jurisdictional issue open for arbitration. Instead, they continued with the trial and obtained a judgment on the merits, and then later asserted that the Court should never have entertained the issue. He expressed the view that parties should not be permitted to abandon a procedural objection, allow the trial to proceed and be defeated on the merits, and subsequently invoke the objection on appeal. In his opinion, once the parties have allowed the trial to proceed and have been defeated on the merits, it is too late to insist before the Court of Appeal on any right to object to the Court’s jurisdiction.

In his judgment, the Court explained that the parties could have retained jurisdiction only if they had asserted it correctly and at the appropriate time, as reflected in the passage on page 105. Lindley L.J. observed that, considering the approach taken by the lower court, the defendants must be regarded as having waived the objection at that level, and consequently it would be improper for the appellate court to reconsider it, a view recorded on page 107. Bowen L.J., concurring with the other Lords Justices, stated that if the issue had been raised and maintained from the outset, it might have been answered, but because it was not taken initially, it should be treated as abandoned. He further explained that when a party waives a point and does not insist on it, the court is under no obligation at any stage of the proceedings to revisit the matter or to treat the waiving party as if the point had never been abandoned. The Court emphasized that this decision was not isolated nor did it introduce a new rule of practice. It reaffirmed that litigants should not be allowed to fragment the bases of their claims or defenses at different stages, thereby causing unnecessary difficulty for their opponents. Public‑policy considerations, the Court said, demand that a party who succeeds at the appellate stage should not be confronted with fresh grounds of attack after having defeated the original arguments. The proper role of an appellate court, according to the judgment, was to correct errors in the judgment or procedure of the lower court, not to adjudicate a different dispute that had never been presented before that court. Only in exceptional circumstances could the appellate court, exercising its discretion, permit a new issue to be raised, and this was permissible only when there were compelling reasons for doing so and when no prejudice would be caused to the opposing party. When the appellate court, using its discretion, refused leave to raise such a point, the Court indicated that there was little room for the higher court to show leniency. The Court noted that this principle would resolve the question of whether mesne profits could be awarded up to the date of delivery; however, because a fellow judge had already examined that question on its merits, the Court felt it necessary to address it as well. The judgment expressed regret at not being able to agree with the fellow judge’s reasoning on the first issue. Finally, the Court affirmed without doubt that, under Order XX, rule 12(c) of the Code of Civil Procedure, a court must direct an inquiry into mesne profits from the date the suit is instituted until either (i) possession is delivered to the decree‑holder, (ii) the judgment‑debtor relinquishes possession and the decree‑holder is notified through the court, or (iii) three years have elapsed from the date of the decree, whichever occurs first.

The provision stipulates that mesne profits may be awarded only for a period of three years from the date of the decree, or until the earlier of the specified events. Accordingly, when the Madras High Court issued a preliminary decree on 7 March 1938, it was required under clause (c) of rule 12(1) of O.XX, C.P.C. to give directions on the manner of determining mesne profits in accordance with that limitation. Instead, the High Court issued a single direction stating that mesne profits should be calculated only up to the date on which possession was delivered, and that no further assessment was to be made. It is possible that the Court did not anticipate any delay in the delivery of possession beyond three years from the date of the decree, or that it simply overlooked the scenario in which possession might be delivered after that three‑year period. Consequently, the omission of an explicit statement that mesne‑profit assessment could not exceed three years from the preliminary decree does not automatically constitute an error. Even assuming that the direction in the preliminary decree—namely, that mesne profits were to be determined and payable up to the actual date of delivery of possession, whenever that occurred—was mistaken, the decree must nevertheless be given effect. The decree was not contested by way of a further appeal; therefore, under section 97 of the Code of Civil Procedure, which provides that a party who does not appeal a preliminary decree “shall be precluded from disputing its correctness in any appeal which may be preferred from the final decree,” the decree has become final between the parties. The present appeal is an appeal from the final decree, and the appellant is consequently barred from challenging any direction contained in the preliminary decree. This position is supported not only by the reasoning in Ittyavita Mathai’s case (para 8, p. 910) but also by the recent Supreme Court decision in Smt. Gvarsi Bai & Ors. v. Dhansukh Lal & Ors. In that case, Justice Subba Rao, speaking for a unanimous Court, observed: “In a case where a decree is made in Form No. 5A, it is the duty of the Court to ascertain the amount due to the mortgagee at the date of the preliminary decree. How can the amount due to the mortgagee as on the date of preliminary decree be declared unless the net profits realized by him from the mortgaged property are debited against him? The statutory liability of the mortgagee to account up to the date of the preliminary decree would be the subject‑matter of dispute in the suit up to the date of the said decree. The Court has to ascertain…”

In the case, the Court explained that the mortgagee’s entitlement had to be measured by first determining the amount due under the mortgage deed, then deducting the net realizations in accordance with section 76(h) of the Transfer of Property Act, and finally ascertaining the balance payable to the mortgagee as of the date of the preliminary decree. The Court further held that if the mortgagor failed to raise this issue during the earlier proceedings, the principle of res judicata would prevent him from later raising the same claim, because the issue would be considered to have been directly and substantially in dispute at the stage of the preliminary decree. The Court stated that it is settled law that, although a mortgage suit remains pending until a final decree is issued, any matters that were decided—or that ought to have been decided—by the preliminary decree become final. The Court illustrated this principle with a hypothetical situation: if the mortgagor had paid certain sums to the mortgagee before the preliminary decree, and those payments were not credited to the mortgagor while the preliminary decree declared a larger amount due to the mortgagee, the mortgagor could not reopen the question after the preliminary decree was rendered. The Court emphatically declared that such a reopening was barred because the preliminary decree had become final with respect to the disputes that should have been raised before its issuance.

The Court then referred to earlier authorities, noting that the general principles of res judicata applied to the present case as they had been articulated long ago in Ram Kirpal Shukul v. Mussumat Rup Kuari and subsequently affirmed by the Court in Gulabchand Chhotalal Parikh v. The State of Bombay (now Gujarat). The Court acknowledged the contention raised by the appellant that the present appeal from the final decree sought only an interpretation of a direction contained in the preliminary decree, and that such direction should be construed so as to render it a decree in accordance with Order XX, rule 12 of the Code of Civil Procedure. The Court clarified that a question of construction arises only when a decree is ambiguous. Several cases were cited on behalf of the appellant, some of which had been discussed in the judgment of the learned brother and in the full bench judgment in Kudapa Subbanna v. Chitturi Subbanna & ors. That decision formed the subject of the appeal preferred by respondent No. 1 in Civil Appeal No. 926 of 1963. The Court conceded that when the meaning of a term in a decree is unclear or ambiguous, the duty to interpret that term falls upon the court, and the appropriate construction must make the decree conform to the law. However, the Court concluded that the direction contained in the High Court’s preliminary decree did not suffer from vagueness, ambiguity, or any incompleteness that would render its enforcement impossible, even if the High Court had possibly erred in its discretion or overlooked certain statutory limitations.

It appeared that the High Court either mistakenly believed it possessed discretion to specify any of the three events enumerated in clause (1)(c) of rule 12 of Order XX, or that it expected the appellant to surrender possession to the respondent before the expiry of three years. An alternative possibility was that the High Court had simply overlooked the limitation contained in clause (c) of Order XX, rule 12(1). Regardless of which of these possibilities was correct, the direction in question was not rendered vague, ambiguous, or incomplete. To determine whether any term or direction in a decree is clear and complete, the court must normally confine its examination to the wording of that term itself. Only when a doubt about the meaning of the words arises, or when the words conflict with another part of the decree, is the court justified in consulting other provisions of the decree. In the present case no such doubt or conflict was demonstrated. The learned counsel, Mr. Viswanatha Sastri, did not argue that the term conflicted with any other term of the decree; rather, he asserted that taken in isolation the term would contravene law and therefore must be read in conjunction with the whole of Order XX, rule 12(1)(c). The High Court, however, extracted only a portion of that provision and gave effect to that fragment, omitting the remainder. The counsel’s substantive argument was that the High Court committed a legal error in doing so, but even a legal error does not invalidate the direction issued by the High Court.

Even assuming that a particular term of a decree is erroneous in law, the decree remains binding on the parties until it is corrected on appeal or through another appropriate proceeding. A decree of this nature, such as Appeal No. 368 of 1956 decided on 23‑2‑1962, cannot be treated as one passed without jurisdiction. It is well established that a court may decide a case incorrectly while still acting within its jurisdiction, a principle affirmed by the Privy Council in Malkarjun v. Narhari and subsequently adopted by this Court in Ittyavira Mathai’s case. A wrong decision is certainly vulnerable to challenge, yet it does not automatically become unenforceable; unless set aside in accordance with the provisions of the Code, it continues to operate as res judicata between the parties at all subsequent stages of the litigation. The author has therefore omitted a detailed discussion of the various authorities cited at the Bar, because in those cases the decrees were found to be vague or incomplete. Consequently, it would be inappropriate for a court to characterize a term that appears clear and complete on its face as vague merely because the court believes the term is erroneous. So long as the term or direction is complete on its face and capable of enforcement, the court that is tasked with giving effect to the decree of a competent court has no power to disregard it, even if the term may be contrary to law.

In this case the Court observed that it would be improper for a court to label a term of a decree as vague or incomplete when, on its face, that term seemed clear and complete, merely because the court considered the term to be erroneous, and then to proceed to interpret it. The Court explained that when a court’s duty is to give effect to a decree issued by a court of competent jurisdiction, it is irrelevant whether the term or direction, as written, is contrary to law. So long as the term appears complete and capable of enforcement, the court lacks authority to look behind the wording. Accordingly, the Court held that the first contention advanced on behalf of the appellant had to fail. Turning to the issue of the quantum of mesne profits, the Court concurred with the learned brother that the High Court had not provided satisfactory reasons for increasing the amount. In analysing the various items, the High Court appeared to have proceeded on assumptions or had raised the rates of profits to be allowed without referring to any basis for such enhancement. In view of these observations, the Court agreed with the proposed approach suggested by the learned brother. As a result, the Court concluded that the appeal succeeded only in part and that the appropriate order regarding costs was that each party should bear its own costs in this Court. Accordingly, the appeal was allowed. (1) 27 I.A. 216. (2) A.I.R. 1964 S.C. 907.