CPC Case Brief – SBI v. Emmsons International (First appeal)

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This is a case regarding first appeal mainly covered under section 96 of the CPC.

Facts: Most of the facts are not relevant to our course, but it needs to be understood that Emmsons, plaintiff, filed a case against SBI, defendant, in the trial for payment of Letter of Credit. The trial court framed 5 issues that needed to be considered for resolving its dispute. The trial court gave its order and then the decision was appealed by the aggrieved party to the High Court. The High Court reversed the order of the Trial court without passing judgment on the fifth issue in the case. The case has been appealed to the Supreme Court.

If you read from para 19 onwards it is clear that the SC is pissed off at the fact that the HC is not appreciated the case before and has been ignorant of the issues at hand.

SC quotes section 96 and a bunch of other cases and says that the High Court being the court of the first appeal ought to have appreciated the evidence at hand decided the case addressed all issues of fact and law before reversing the order of the trial court. SC said that the HC failed to exercise its jurisdiction under section 96 of the code and hence the judgement of the HC was reversed and a fresh hearing of the case ordered.

Below is the court’s justification verbatim: “The first appeal has to be decided on facts as well as on law. In the first appeal, parties have the right to be heard both on questions of law as also on facts and the first appellate court is required to address itself to all issues and decide the case by giving reasons. Unfortunately, the High Court, in the present case has not recorded any finding either on facts or on the law. Sitting as the first appellate court it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording the finding regarding title………”. In our view, the High Court failed to follow the fundamental rule governing the exercise of its jurisdiction under Section 96 of the Code of Civil Procedure, 1908 that where the first appellate court reverses the judgment of the trial court, it is required to consider all the issues of law and fact. This flaw vitiates the entire judgment of the High Court. The judgment of the High Court, therefore, cannot be sustained.

For the above reasons, we accept the appeal, set aside the impugned judgment of the High Court and restore First Appeal No. 225 of 2002 for rehearing and fresh decision. All contentions of the parties are kept open to be agitated at the time of the hearing of the first appeal. No order as to costs.

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