"Decree" as the formal expression of an adjudication which conclusively

determines the rights of the parties with regard to all or any of the matters in
controversy in the suit.

[Case Brief] Mathuralal And Ors. V/S Chiranji Lal And Ors.

Case name: Mathuralal And Ors. V/S Chiranji Lal And Ors.

Case number: AIR 1962 Raj 109

Court: THE HIGH COURT OF RAJASTHAN

Bench: Justice Jagat Narayan

Decided on: December 2, 1960

Relevant Section 2(2) , 151 Civil Procedure Code

Act/Sections:

 BRIEF FACTS AND PROCEDURAL HISTORY:

1. Chiranji Lal filed a suit on January 28 1953 in the Court of Civil Judge Banswara for
dissolution of partnership and detention of accounts against the 4 applicants named as
Mathuralal, Nanalal, Manaklal and Babulal and the same on the remaining 3 respondents
named as Maganlal, Karulal and Sujanmal and a preliminary decree was passed in the
suit on August 16 1954.
2. A lawyer was appointed under the preliminary decree as commissioner to go into the
accounts and submit a report in order to enable the court to pass of final decree. But on
February 22 1955 the Commissioner submitted a report stating his inability to arrive at a
definite finding with regards to the matter.
3. The plaintiff and the defendants on April 20 1955 filed an application to appoint
Arbitrators and the same was accepted by civil judge and further referred the case to the
 Arbitrators. It was further noted that one of the arbitrators named as Shri Heera Lal had
moved away for the treatment of his wife and the same let the other arbitrators unable to
act in his absence.
4. The procedural history is :
a. Maganlal's defendant appealed against the decree passed on August 16 1954 and
then the appeal was dismissed by the District Judge on April 18 1955. And then
he filed a second appeal in the High Court which was withdrawn by him on April
26 1956 and the same was dismissed as he had withdrawn.
b. Civil judge on October 1 1955 passed an order the party should either nominate
another arbitrator in place of Shri Heera Lal or show cause that why the reference
should not be superseded and the case was disposed by the court.

 ISSUE BEFORE THE COURT:

1. Whether or not the plaintiff seeks permission to institute a fresh suit at the time of
withdrawal under Order 23 Rule 1 (2) ?
2. Whether the Court can allow the withdrawal of the case which has been referred to the
Arbitrators ?
3. Whether the revision application is to be allowed by the Court ?

 RATIO OF THE COURT:

1. The plaintiff on November 21 1955 appeared before the Civil Judge and presented an
application stating that the case was referred to the arbitrators about six months ago and
further no decisions had been given and the time for submission of the award has also
passed and made a prayer that the reference to be superseded.
2. The plaintiff also stated that because of the inability of the Commissioner to submit the
report he do not wish to proceed further in this matter and accordingly stated that this
application under order 23 rule 1 for withdrawing the suit and further do not wish to pay
costs to any defendants.
3. Defendants counsel on the plaintiffs application noted that he did not wish to claim any
cost and the application for the withdrawal was signed by Chiranji Lal.
4. The Court noted that the plaintiff had presented an application stating that he had wished
to withdraw the suit and the plaintiff does not wish to ask for permission to bring in a
fresh suit and the suit was accordingly dismissed by the court under order 23 rule 1
stating that the party shall bear their own costs and the appointment of the arbitrators is
superseded.
5. The Court observed that on February 17 1956 the applicants in the revision application
filed petition for the review of the order on November 21 1955 under the order 47 rule 1
and Section 151 CPC. However the Civil Judge refused to review the order and rejected
the same on June 18 1956 and held that the withdrawal of a suit under order 23 rule 1
after the passing of the preliminary decree was only applicable in a case in which
permission to file a fresh suit was sought.
6. The Court considered the question of the award of costs and stated that there was an
adjudication with the meaning of Section 2 (2) CPC and the order of the court amounted
to a decree and the reliance was placed on the observation made in the case Jujisti
Mahapatro v. Magata Patro .
7. The Court observed that the case which relied upon the respondent was distinguishable as
a preliminary decree for sale was passed on December 12 1921 which fixed six months
for payment of the amount.
8. An appeal was filed by the judgement debtor and it was observed that after some of the
respondents served the appeal it was withdrawn by the court passing the order that the
appeal is withdrawn and it is dismissed with costs and the cost will be proportionate.
9. On January 21 1924 and the decree holder also applied for the passing of the final
decree the district Judge held that as there was not judicial determination by the appellant
court the right to apply for the final decree recruited on June 12 1922 and filing for the
final decree also expired on June 12 1925.
10. The Court is of the opinion that in a suit for accounts it was not necessary for defendant
to make counterclaims and the Civil Judge erred in thinking that because Mathuralal had
not made a counter claim in the suit therefore he could not be prejudiced by the dismissal
of the suit.
 11. Court observed that another principle violated by the civil judge was by granting
permission to the plaintiff to withdraw the present suit. As the court cannot permit the
withdrawal of a suit which has been referred to arbitration.
12. The Court holds that the reference to arbitration can no doubted be recalled by the court
under certain circumstances as to whether the arbitrator conducted himself or where the
time for making the award had expired and the Court does not think fit to grant any more
time.
13. The Court is of the opinion that it has no power to pass an order which in anyway affects
the subject matter of the suit and if a plaintiff is permitted to withdraw The suite the
effect of the order is to supersede the reference entirely and free the plaintiff from his
contract to submit the dispute to the arbitration as in the case of Sheombar v. Deodat .

 DECISION HELD BY COURT:

1. Revision application was allowed and the order of the Civil Judge was set aside.
2. Mathuralal, Nanalal, Manaklal and Babulal shall be transposed as plaintiffs in the suit
and Chiranji Lal plaintiff shall be transposed as a defendant.
3. Maganlal, Karulal and Sujanmal shall continue as defendants and it will be open to the
learned Civil Judge to supersede the reference in accordance with law and proceed with
the preparation of the final decree himself if he thinks fit to do so.
4. The arbitrators shall be called by the learned Civil Judge and shall be asked to proceed
with the arbitration.
5. It was directed by the Court that parties shall bear their own costs of this revision
application.

-Author : Aditya Das.