Adverse Finding Of The Court Of First Instance Can Be Challenged Before The Appellate Court Without A Cross Objection

Case Background

• The Gala land, initially in possession of one Zahid Hussain, was declared as “surplus” by the Competent Authority, in 1988, under the Urban Land (Ceiling and Regulation) Act 1976(ULCRA), which was handed over to the Moradabad Development Authority (MDA).
• Hussain filed a revenue appeal before the Moradabad District Judge, who, in 1993, directed the Competent Authority to reconsider its decision.
• While the case was being reconsidered, Hussain had sold his part of the land to the First Respondent.
• In the meantime, the ULCRA Act was repealed whereby, the proceedings before the District Judge regarding the 1988orderwas held by the MDA to have been abated.
• The First Respondent alleged that the sale is valid, and that he became the owner of the land, and the MDA retained the other part.
• In 2008, the MDA had sold, by auction, around 600 sq. mt. of the Gala Land to the Appellant, and the same for challenged by the First Respondent.
• It was pleaded that out of the 600 sq. mt., the MDA had the title for 200 sq.mt., and therefore, the auction of the remaining 400 sq. mt. is null and void.
• The matter was first heard by the Trial Court in 2011 and the Court held MDA to be the legal owner of the land, and also validated the auction sale.
• On appeal, the High Court, in 2018, reversed the order, and ruled that the land belonged to Zahid Hussain, and the sale between Hussain and the First Respondent to be legal and valid.
• The Appellant then appealed to the Supreme Court.

Appellant’s Submissions

• It was submitted that the sale deed between Hussain and the First Respondent is itself void, and therefore the suit instituted by the First Respondent is nullified.
• It was further argued that the High Court’s order is erroneous and the Trial Court had no jurisdiction to try the suit as the same was barred by the ULCRA Act, since a fair reading of the plaint would make it evident that the object and purpose of the suit was to impugn the validity of the proceedings under the ULCRA, without impleading either the State of Uttar Pradesh or the Competent Authority under the ULCRA.

Respondent’s Submissions

• The Respondents relied on the acquisition of 1986 that divided the Gala Land into two parts, by virtue of which the MDA was entitled to only 200 sq.mt. thereof.
• It was also argued that the order of the Competent Authority was held back for reconsideration, and there has been no evidence with regards to further proceedings before the enactment of the Repeal Act.

Analysis by the Supreme Court

• The Supreme Court observed that the first sale deed between Hussain and the Respondent was not approved, and as a result of which, Hussain had sold 1295. 04 sq. mt. of his own property measuring 2000 sq. mt.
• The transfer of the property covering the Gala Land was not permitted amidst the pending of a suit involving the same.
• The Court opined that the Trial Court was justified in ordering in favour of MDA, and that the High Court had completely ignored about the sale of Hussain’s own property through the deed.
• It was clear that the Competent Authority’s order was remanded by the District Judge, and in such a circumstance, Hussain ought not to have decided to sell the impugned portion of the Gala Land.

Court’s Order

• The Supreme Court Bench comprising of Dr. D. Y. Chandrachud, J. and M. R. Shah, J., allowed the appeal and had set aside the High Court’s 2018 Order.
• The Trial Court’s order was held to be partially correct; however, the Apex Court held that the jurisdiction of the Trial Court is impliedly barred to entertain the suit.
• It further opined that neither the High Court nor the Trial Court had accessed the case properly.
• The suit filed by the first Respondent’s was held invalid.

Court’s View on Order XLI Rule 22 of CPC

• In this case, one of the contentions raised by the Appellant was that a party, in whose favour a decree was passed by a civil court, can put forth arguments in the appeal against findings without filing a cross-objection.
• The main reason for invoking this rule was because the Appellant had challenged the jurisdiction of the Trial Court in trying the case, as the same was barred under the ULCRA Act.
• However, the Trial Court held that it had the required jurisdiction to entertain the suit. The Appellant did not raise this issue before the High Court, but again raised it before the Supreme Court under Order XLI Rule 22 of CPC.
• The Supreme Court referred to the Amendment Act of 1976 and held that it is sufficient to raise a challenge to an adverse finding of the court of first instance before the appellate court without a cross objection.
• It further held that the principles within Order XLI Rule 22 of CPC would apply to petitions filed under Article 136 of the Constitution.

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