JASRAJ INDER SINGH v. HEM RAJ MULTAN CHAND

From the Judgment and Decree dated the 10th/11th August, 1965 of the Bombay High Court {Nagpur Bench) in First Appeal . Nos. 120 and 123 of 1965. S. T. Desai, D. N. Mishra and B. N. Mohta, for the appellant. M. N. Phadke, A. G. Ratnaparkhi, for respond~nt. The Judgment of the Court was delivered by KRISHNA IYER, J.-The two appeals, measured by merits or factual dimensions, may not justify their longevity from une 23, 1949 to February 1977-the former being the date of birth: of the suit and the later the termination, at long last, of the cases in this Court. The subject matter is a relatively small money claim which, perhaps, is less than the amount each side has spent on the forensic scrimmage. Before. we narrate the facts and discuss the law, we permit ourselves a pensive reflection about our processual justice. If we (law-makers and lawyers) tarry any longer to forge a speedy and radical jurisprudence of ,quest for the fruits of rights may tempt suitor"s into the traditional quagmire of processual legalistics where from extrication may prove an expensive futility. The story which hopefully comes to a close .. with this judgment, among many others like this, bears testimony to the crying need for serious reform-not oblique by-pass-of court-system by an aware legi'slature, lest the considerable social cost of ~usuing judicial remedies stultify and disenchant seekers of legal justice. The facts, when unfolded, will validate this obiter intended to alert the law-maker. remedies-in-action, , • H The High Court, thanks to the then rule of valuation under Art, 133 (1) (a) of the Constitution, granted a certificate of fitness. -The appellant plaintiff, as kartha of a joint Hindu family, was running a business in the name and style of Jasraj Inder Singh with two shops, JASRAJ INDl!ll SINGH v. HEM llAJ (Krishna Iyer, !.) 975 A B tme i~ Khamgaon and the other in Bombay. (The trade name for the Bembay Shop was slightly different.) The respondent-defendant had been having dealings with the plaintiff at both places between October 1947 and May 1948. The accounts between the parties fluctuated from time to time, since deposits, advances, withdrawals and entrust- ment of silver, castor, cotton and the like for sale as agents and credit~ ing the prices in the accounts were a running feature of the mutual dealings. The plaintiff isolated the transactions which took place in Khamgaon and brought a suit claiming a sum of Rs. 11,401-7-9 which represented the net balance due on the Khamgaon khata to him from Interest was also demanded on an the defendant on May 12, 1948. It is noteworthy that the plaintiff's initial folly, alleged agreed rate. as Shri Desai, for the appellant frankly admitted, was in excluding from the suit claim the. amounts due one way or the other from the c Bombay branch of the business. The contracting parties were identi- · cal, the dealings were similar and on any fair basis either could get from the other the net amount legally due from both the shops together. But legal sense and commonsense were abandoned by the plaintiff out of the oblique motive of claiming a larger sum than would be due in case a joint balance was strus:k. This dubious device, as will be seen presently, has backlashed on the plaintiff whose disaster in the High Court has been largely courted by this motivated cleverness. To revert to the litigative narrative, the defendant urged in defence demand was untenable since he had deposited six bars of silver with the Khamgaon shop of the plaintiff to be sold through his Bombay branch and if the sale proceeds thereof were taken into account in the (We bypass, for Khamgaon khata a larger sum would be due to him. the time being, the fight over this claim being a set-off under order· VIII, rule 6 C.P.C., or a counter-claim in the nature of a substantive relief for the ~alance.). This counter-claim was met by the plaintiff in an additional pleading wherein he urged that the sale of silver bars was a matter for the Bomb.ay shop and should not be mixed up with the Khamgaon dealings which were the basis of the action. What falls for regrettable comment is that even at this stage the plaintii'I' did not in voke the obvious argument that the Khamgaon and the Bombay shops transactions were both belonged to the same owner and since between the same parties (in different places though) when a suit for (or on) finaJ accounts were filed, all the items in the twin places should If this straight-forward plea were taken figure in the resultant decree. the facts tend to show the plaintiff would still have got a decree, may be for a lesser sum. Oftentimes, obdurate legal· obscruantism of liti gants, leads to protraction of proceedings, projection of intricate pro 'Ceclural punctilios and the phyrric processual victory forensically won being a potent source of perverting truth, draining resources and un <loing justice. This sombre scenario of the case we are deciding proves how on account of the correct curial approach being blinded by the cantankerousness of the plaintiff, conveniently concurred in by the other side, revision and appeal, remand and appeal, and attendant decades of delay and disproportionate litigative spending by both and: H two friendly businessmen, thanks to this feud, turning into foes, follow- . ed-at once a disaster to both and detriment to the busines~ com munity. And -some pre-trial conciliation activism by the court at an D G E F .. • B c D E F G 976 •· · • .SUPREME COURT. REPORTS - [1977] 2 §.,C.R. early stage might well have sorted·out the dispute, bettered their rela· tions and pre-empted this cock-fight. Doing justice is a noble bche~~ ~hich blesses all; deciding the lis within a judicative pyramid, provo- · cative of appeals and revisions, bleeds both and unwittingly incites the. bitter persistence in the struggle to win (and lose !) . · We are courts bf justice guided by law and the signature tune of the indicature . We gently suggested, in this spirit, whether the parties Fiat Justitia. would be disposed to compose their quarrel. Counsel as often happens. constructively helped, but the purchase of peace at this late stage was difficult and we gave up. · Of course, adjudication on the _law and the facts cannot and shall not be influenced by this extra-curial excursion. We pick up the story of the suit where we left it. In the dog-fight that followed, a question of court-fee was raised and decided. That was taken up to the High Court and returned. A preliminary decree for accounts of the Bombay kbata was passed and that too leapt the High Court resulting in a remand, fresh issues and so on. Then a decree was passed and both sides challenged it in appeal and cross objections and the last lap of the tiring race is this court where vanquished plaintiff is the appellant. We proceed to decode the justice and the law of the cause. . We may state that the plaintiff's obstinate attitude in' treating the Bombay shop and Khamgaon shop as two different persons each being entitled to sue the defendant without reference to the amounts due to the latter from the former in inter-connected business dealings is a legal fallacy and cute perversity. However we may repeat defendant also proceeded on that 'shop autonomy' theory but only urged that the silver bars were wrongfully omitted from the Khamgaon kbata. Shops are not persons although suits may be filed in names. The trial court took a commonsense view in commingling the business account of the same parties. This was good law. A plura lity of shops owned by the same person does not proliferate into many shop-persons. At an intermediate stage of the many involved inter locutory skirmishes, the plaintiff did allege : "The alleged silver bars were sold by the defendant Suwalal through the said Bombay shop and naturally the sale proceeds of that quantity of silver are credited in the defen dant's Khata in the Bombay shop. · The plaintiff, therefore in reply to the defendant's claim of Rs. 17000/- has to file the extracts of accounts of the Bombay shop to put the full picture of transactions before the court. As the Bombay shop shows the balance of Rs. 4535-12-0 as due to defendants, the said fact has been so mentioned by the plain tiff in his statement." In passing, we may mention that the counter-claim led to a demand · for court-fee and the High Court affirmed this order but reduced the sum on .which such fee was payable. Later, issues were framed by the trial Court which reflected the integrated nature of the dealings be tween the two parties iii the shops at Khamgaon and Bombay. · The .. / .. -:, '.fASRAJ.°iNDER SINGH" v •. HEM 11.AJ (Krishna Iyer, J.) -ii77 learned . District Judge; not. obsessed. by. the wrong-headed pleadiIJ."i:s;·- A . took ·the view that the shops, though located at different places,· were • owned by the same family and the claims were so inter-connected that, in equity and law, set off was permissible and the net sum due to the plaintiff-'-less than what he had sued for-should be decreed. We may mention the relevant issues framed at the first round even here since we may have to refer to them later when dealing with a supportive submis Issues 5 and 7 may be repro- sion of Shri Phadke for the defendant. duced here : · · B · "5. Whether the Bombay & Khamgaon shops owned hy plaintiff's partners are so connected with each other that a composite account of the entries in the two shops can be made by the Defendants ? * * *· *

#7. Whether on making an account of the two shops of the Plaintiff of Bombay and Khamgaon, the Defen dants are entitled to a set-off thereafter to a sum of : - (a) Rs. 17,000/- as claimed by the Defendants or to a set-of!. (b) Rs. 4,535-12-0 as stated by the Plaintiff ?" . Later, amended pleading's led to amended issues of which issues 4 to 6 are meaningful and are set out below with the findings _thereon; K4. Whether the Bombay and Khamgaon shops owned by plaintiff's partners are so connected with each other that a composite account of the entries in two shops - Yes can )le made by the defendants ? ·

#5. (a) Whether a sum of Rs. 44,697 /10 is debited to the defendants in the account of the Bombay shop ?-Yes (b) Are these entries proper and correct ? · (c) And in time? -Yes. -Yes. Ci. Whether on making an account of the two shops of . the plaintiff of Bombay and Khamga·on the defen dants are entitled to. a set-off and thereafter to a sum of- (a) Rs. 17,000/- as claimed by the defendants or to -No. a set off (b) Rs. 4,535/12/- as stated by the plaintiff ?-Yes. The plain fact emerges that the two parties were having de3lings with each other, that the dealings in Khamgaon and Bombay were inter-related and not totally different transactions, d;ssociated in nature and divorced in period. The trlal judge treated the totality of tran . sactions as a composie ·account and the suit as one on accounts. He granted a decree on these terms c D E F G H ' .. ,_--_---- \r 978 SUPREM! COURT REPORTS [1977] 2 s.c.R. A "The Plaintiff shall render an account of the Bombay shop to the defendant, who shall be entitled to falsify and sur charge. A preliminary decree for accounts under order 20, rule 16 CPC shall be drawn up. After making an account and the necessary adjustment, the ev6ntual liability 1inter se shall be determined. Costs shall abide the result." B The plaintiff appealed and the defendant filed cross-objections. After a 'study of 0.8, r. 6 CPC, the High Court felt that the Bombay accounts should not have been gone into and the defendant's claim by way of set off alone was available for adjudication. Since it had been held that the silver bars were an item in the Khamgaon shop accounts, the direction for rendition of the Bombay account was illegal. The Court observed : c D E F G H "The learned lower Court was thus in error in converting the claim of set off into a claim for rendering accounts by the plaintiff to the defendants in respect of the dealings made in the Bombay shop. The lower Court was bound in terms of Order 8 Rule 6, to treat this claim of set off as a money claim in respect of the ascertained amount and to find whether such amount was due to the defendants from plaintiff. If such amount was found due to the defendants from the plaintiff, -then the defendants would be entitled to set off that amount as against the claim of the plaintiff. The decree as passed by the learned lower Court will, therefore, have to be set aside. It is necessary for the trial Court to decide as to what amount was due to the defendants from the plaintiff. The issue was framed and parties have led evidence. The lower Court shall decide the 1ssues left unde cided for final decree. The learned lower Court will decide whether it is proved on the facts that the defendants have to recover Rs. 17,000/- from the plaintiff, and if so found, will adjust the eventual liability inter se, and if it is found that any of the parties has to recover any amount from the other, a decree should be accordingly pas'sed. . . The case is, therefore, sent back to the trial Court who will decide as to what amount is due to the defendants from the plaintiff. Thereafter whatever amount is found due to the defendants shall be adjusted towards the proved claim of the plaintiff in respect of the deposits in the Khamga?n shop. The Court shall pass a decree in favour of the party m whose favour the balance will be found due." It is true that the High Court's observations inhibited the Bombay accounts being generally reopened but when the case was re.m.and.ed for fresh decision, the trial Court, apparently pressed by the miustice of amputating the composite dealin~s, w~nt on to hold that while the plaintiff was right in his demand vrs-a-v1s the Khamgaon Khata, the defendant was cntit~ed to a sum of Rs. 4.535/12/- from the Bombay accou~ts and awarded to the plaintiff a decree for the net balance of r j ' JASRAJ INDER SINGH v. HEM ll.AJ (Krishna Iyer, /.) 979 Rs. 7,464/4/-. This he did in purported compliance with the Hip A Court's direction. He wasi bound by it and to act contrary to a higher court's on!er is to be subversive of the discipline that the rule of law en joys in our hierarchical justice system. The trial Judge, in recording findings on all the issues, did a comprehensive investigation of the although entrusted to the Bombay accounts since the silver bars, Khamgaon 8hop, were sold in Bombay and rightly credited in the Bombay Khata. B To pick out a single true iteilJi which had been inextricably got en meshed in the skein of entries and cross-entries was to tear up the fabric of the whole truth. In a finer sense, harmony is the beautiful totality of a whole sequence of notes and the concord of sweet sounds is .ill tuned into disjointed discord if a note or two is unmusically cut and played. Truth, like song, is whole and half-truth can be noise : Justice i-: truth, is beauty and the strategy of healing injustice is discovery of the whole truth and harmonising human relations. Law's finest hour is not in meditating on abstractions but in being the delivery agent of full fairness. This divagation is justified by the need to remind our selves that the grammar of justice accord'ing to law is not little litigative solution of isolated problems but resolving the conflict in its wider bearings. Let us pick up the threads of the litigation. Even the interroga tories served and the answers elicited made it clear that wh'ile there were two shops in two different venues, the dealings between the plain tiff and the defendant were closely connected-rather, integrated. That furnished the justification for the trial Judge to examine the Bombay accounts between the parties and he came to the factual conclusion : 'I see absolutely no reason to doubt the ccrrectness of any of the entries I answer in these extracts of plaintiff's account book ( exht. P-23). issues 5 (a) and (b) in the affirmative. Ex. P. 23 contains on the credit side the sale proceeds of defendant's silver which was sold in Bombay. A plea had been feebly raised by the defendants that some of the items in the Bombay account were barred by limitation and the plaintiff could not claim credit for them. 11ris plea was also examined by the trial Court and negatived with the observation : 'I hold that view of the credit and debit entries in Ex. P. 23 all the debit entries were within time at the material period. I answer issue 5(c) in the affirmative'. Thus there was no denial of fairness in the trial because the Bombay accounts in their entirety were put in is'sue, and focused on by both sides in the evidence followecd by appropriate findings. The upshot 'Thus all of this process was, in the language of the trial Court : to Rs. 12,000/- minus Rs. things considered plaintiff is entitled 4,535/12/- i.e., Rs. 7,464/4/- from the defendants'. The court denied costs to both since neither came with clean hands. Both sides were guilty of not playing cricket and, in this game of over-reaching each other, the Court's penalty is denial of costs. This rule was adopted by the trial Court. c D E F G H / A B c D E F G H 980 SUPREME COURT REPORTS [1977] 2 s.C.R. When the case went up in appeal, the High Court harked back to the order of the Nagpur Bench in the same case i'n a revision filed ·against the order of payment of court-fee for the counter-claim. It ~s true the High Court had then held that only a specific sum relat mg to the sale of silver bars was the basis of the counter-claim and the entire accounts of the Bombay shop was not at large before the Court. The High Court referred again to the decree first passed by the trial Court to render an account of the Bombay shop to the defendant on the footing that the accounts in Bombay and Khamgaon were so interconnected as to warrant a composite understanding of the entries in the two shops. This approach of the trial Court in passing a preliminary decree for rendition of accounts was set aside by the High Court in appeal at the first round on the score that the plea of the defendant was confined to one of set off under 0.8, r. 6 CPC. Therefore, argued the High Court, .. .. "A mere liability to account cannot be an answer by In fact, the way of set off to the claim of the plaintiff. defendants in their written statement, claimed by way of set off such ascertained sum of money which, according to, them, was Rs. 17,000/-. It is because such ascertained sum was claimed by way of set off that the claim was enter investigation by the lower Court. Therefore, tained_ for the only question that was before the learned lower Court was to find out what amount was due to the plaintiff from the defendants in respect of the deposits of amounts made in the Khamgaon shop and also to find out what amount was due to the defendants from tthe plaintiff in respect of the silver shop. The transactions made in the Bombay question of rendering accounts by the plaintiff to the defen dants could not arise on the facts of the case." The remand order was undoubtedly binding on the lower ,Court and had directed a limited enquiry and passing of a decree 'in favour of the party in whose favour the balance will be found due'. The High Court held that after the remand the learned trial Judge had no jurisdiction to look into the Bombay accounts as a whole and on account of the misapprehension of the observations of the remand order an illegal decree had been passed in favour of the plaintiff. What was the misapprehension about? While directing a remand, the High Court ordered that issue 6 should be decided by the trial Court and this issue has been set out earlier by us. Naturally, the trial Court took the view that the High Court, having ordered an adjudication of issue no. 6, vested it with the jurisdiction to enquire into the Bombay accounts in toto and pas·s the decree that w0e liave already indicated, viz., a deduction of the surplus due to the defen dant from the Bombay accounts from the amount due to the plain tiff from the defendant according to the Khamgaon accounts. The arithmetic is not in dispute and, indeed, while both the counsel have taken us through the evidence in the case we are satisfied that if both the Khamgaon and the Bombay accounts had to be gone into, ' • f' JASRAJ INDER SINGH v. HEM RAJ (Krishna Iyer, !.) 981 the decree passed was correct both regarding the quantum and on the , issue of limitation. This we affirm because Shri Phadke had feebly · pressed before us that in. any case his client should be given a fresh . opportunity to make out his case regarding the various entries in the Bombay Khatha. We are· not satisfied that the defendant has not had a full say and we are therefore disinclined to accede to this request. The surviving question before us is whether it was in order for the trial Court to have investigated the accounts in t¥ two shops together as if they were transactions between the same two persons or whether the remand order of the High Court at the first round had fettered the trial Court's hands in doing justice in this comprehensive way. The suit is for a sum due on accounts. The parties are the · same. There are two shops belonging to the same owner. The re~ turn of the income fro!!J. the two shops, for income-tax purposes, is a consolidated one. In sl;10rt, there was oruy one person who owned two shops and it is wrong to construe the situation as i•f there were two juristic entities or person•al. Secondly, the defendant, who dealt with the plaintiff in the two shops, was the same person. He had no dual characters t_o play. The dealings were either in one or in the other shop. They were business dealings between .two business men, during the same p_eriod, and even inter-relat_~d, to such an ex tent that sometimes advances were made from one shop and reali sations were made in ~h~ other shop. In short an artificial dissectio111 of these transactions could not square up with the reality of the situa tion. Shri Phadke urged that one contract was one transaction and a set of contracts need not be necessarily brough~ up in the S\lme action between the same parties. We consider that the true nature of the action here is a suit on accounts for the sum due on striking a ba lance. That itself is the cause of action. Such a suit is not unfami liar and such a cause of action may be made up of various minor transactions. Viewed at the micro-level each may be a si•ngle con tract. But viewed; at the macro-level as a suit on accounts, it is a single cause of action. If the present action is one on accounts and if the various entries in the two shops at Khamgaon and Bombay in volve transfusion of funds and goods, there is no reason why we should not accept as sound the approach made by the trial Court that the entirety of accounts in the two shops should be viewed as a It reduces litigation; it promotes the final financial composite one. settlement as between the parties! it has the stamp of reality. Other wise it would be an odd distortion to grant a decree for the plaintiff strength of the Khamgaon accounts while he owesJ_he defendants Rs. 50,000/- according to the Bombay accounts. Order 8, rule 6, CPC deals with a specific situa tion and does not prevent the Court, where the facts call for wider relief, from looking into the accounts in both places to do ultimate justice between the parties. Procedure is the handmaid and not the mistress of justice and, in this spirit, the trial Court's adjudication cannot be faulted. for, say Rs, 10,000/- on the Be that as ~t may, in an appeal against the High Court's finding, the Supreme Court is not bound by what the High Court might have B c D E F G H 982 SUPREME °COURT J!.EPORTS [1977] 2 S.C.J!.. held in its remand order. n is true that a subordhiate court is bound. by the direction of the High Court. It is equally true that tlie same High Court, hearing the matter on a ·second occasion or any other court of co-ordinate authority hearing the matter cannot discard the earlier holding, but a finding in a remand order cannot bind a higher Court when it comes up in appeal before it. This is the correct view of the law, although Shri Phadke controverted it, without reliance on any authority. Nor did Shri S T Desai, who asserted this proposi tion, which we regard as correct, cite any precedent of this Court in support. However, it transpires that in Lonankutty v. Thomman(') this proposition has been affirmed. Viewed simplistically, the re mand order by the High Court is a finding in an intermediate stage of the same litigation. When it came to the trial court and escalated to the High Court, it remained the same litigation. The appeal be fore the Supreme Court is from the suit as a whole and, therefore, the entire subject matter is available for adjudication before us. If, on any other principle of finality statutorily conferred or on account of res judicata attracted by a decision in an allied litigation the matter is concluded, we too are bound in the Supreme Court. Otherwise, the whole /is for the first time comes to this Court and the High Court's finding at an intermediate stage does not prevent examination Intennediate stages of the of the position of law by this Court. litigation and orders passed at those stages have a provisional finality. After discussing various aspects of the matter, Chandrachud J., speak ing for the Court in Lonankutty (supra) observed: "The circum stance that the judgment of the High Court was not appealed against, assuming that an appeal lay therefrom, cannot pre clude the appellant from challenging the correctness of the view taken judgment." The contention barred be by the High Court in that fore the High Court is still available to be canvassed before this Court when it seeks to pronounce finally on the entirely of the suit. remanding Shri Desai cited before us the decision of the Bombay High Court, in Ratanlal( 2 ), as part of his argument. Therein it is laid d9wn that a remand order will not operate as res judicata and pre clude the remanding court from reopening it at the subsequent stage of the same continuing proceeding when the law underlying the re mand order is differently interpreted by a larger Bench or by the Supreme Court. Such an order or finding recorded at the stage of remand happens to be interlocutory and -cannot terminate the cause remanding finally so that when the court, the previous remand order would ordinarily be conclusive and binding like any other interlocutory order. But exceptions there are where a re--consideration of such an order is necessitated either by discovery of fresh matter or pf unforeseen development subsequent to the order or change of law having retrospective effect. We do not make any comments on this argument of Shri Desai and leave it at that. litigation comes up before the (1) [1976] 3 s.c.c. 528. (2) (1975) Mah. L.J. 65. c D E F G H JASRAJ INDER SINGH v. HEM RAJ (Krishna Iyer, !.)

#983. The trial Court's judgment has therefore to be restored. It accords with justice and with law. There will thus be a decree in favour of the plaintiff in a sum of Rs. 7,464/4/-. Even truthful cases urged through unveracious forensic processes must be visited with the puni- tive curi'al displeasure of denial of costs and discretionary interest. Here the plaintiff sued for a sum of Rs. 121000/~ and gets a decree for less than Rs. 8,000/-. We deny hi~ costs for the amount de- creed in his favour but allow costs for the defendant to the extent he has succeeded (viz., for Rs. 4,535/12/-). The equities of the situa- tion are such, especially having regard to the long lapse of time and the dubious attitude of the plaintiff and li•tigative prolixity, that we do not award interest on the amount decreed at all. ·, A. B: P.B.R. Appeal allowed-