Messrs NATIONAL SECURITY INSURANCE Co. Ltd. vs Messrs HOECHST

ORDER

1. ' NASIM HASAN SHAH, J.---The facts forming the background to this petition are that M/s. Hoechst Pakistan Limited (respondent No, 1 herein) filed a suit for the recovery of Rs, 13,94,554.40 against M/s. National Security Insurance Co. Ltd. (petitioner herein) and respondents Nos. 2 and 3, in the Court of the District Judge, Lahore, which was entrusted for disposal to an Additional District Judge.

2. ' On receipt of the summons, the petitioner herein and respondents Nos. 2 and 3 submitted two separate applications for grant of leave to appear and defend the suit.

3. ' The respondent No, 1 herein (M/s. Hoechst Pakistan Ltd.) contested these applications and pleaded that no such leave to defend should be granted.

4. ' The learned Additional District Judge, however, by his order dated 22-7-1989, did not accept this plea and proceeded to grant leave to the defendant to appear and defend the suit without any condition.

5. ' Feeling aggrieved M/s. Hoechst Pakistan Limited filed a revision petition before the High Court and the learned Single Judge of the said learned Court accepted the same by his order dated 26-11- 1989 and varied the order of the Additional District Judge to the extent that the defendants were allowed to appear and defend the suit subject to their depositing the amount of Rs,13,94,554.40 in the trial Court within a month of his order, failing which the permission for grant of leave to appear and defend would stand vacated. M/s. National Security Insurance Co. Ltd. Moved a petition for leave to appeal against the said order.

6. ' The Assistant Registrar of this Court, by his order dated 27-12-1989, returned the petition for leave on the ground that an appeal alone was competent against the impugned order of the High Court.

7. This order was challenged by an appeal (Civil Miscellaneous Appeal No, 8 of 1989) and after hearing the learned counsel for the parties and the learned Deputy Attorney-General, Mr. Asif Jan, we reached the conclusion that in the circumstances of this case a petition for leave to appeal could be preferred against the impugned order for the reasons to be recorded later vide order dated 30-1-1990. The reasons for this conclusion are as follows:-- ' The order of the learned trial Court granting or not granting leave to appeal with or without conditions cannot, in our opinion, be deemed to be a judgment, decree, final order or sentence of a High Court.

8. ' Article 185(2) of the Constitution lays down: ' An appeal shall lie to the Supreme Court from any judgment, decree, final order or sentence of a High Court--

(a) ..........................

(b) ...................

(c) ..........................

(d) ..........................

(e) If the judgment, decree or final order involves directly or indirectly some claim or question respecting property of the like amount or value and the judgment, decree or final order appealed from has varied or set aside the judgement, decree or final order of the Court immediately below."

9. ' Whereas under sub-Article (3) of Article 185, it is provided:-- "(3) An appeal to the Supreme Court from a judgment, decree, order or sentence of a High Court in a case to which clause (2) does not apply shall like only if the Supreme Court grants leave to appeal."

10. ' Now the question is as to whether the impugned order of the High Court qualifies to be a final order, as visualized in Article 185(2) of the Constitution.

11. ' A Full Bench of the Lahore High Court in Sultan Singh v. Murli Dhar and others (AIR 1924 Lah. 571) observed:- "An order is a 'final order' within the meaning of section 109(a) only if it decides, or has the effect of deciding the cardinal issue in the suit (that is an issue going to the foundation of the suit) and thus disposes of the rights of the parties in the litigation, it being permissible to examine not only the order, but, the circumstances of the case with a view to ascertaining the effect of the order on the suit. It is the nature of the order sought to be appealed against that determines the right to appeal, and an order is a 'final order' within the meaning of section 109(a) only if it puts an end to the litigation between the parties or disposes so substantially of the matters in issue between them as to leave merely subordinate or ancillary matters for decision."

12. ' In V.M. Abdul Rahman and others v. D.K. Cassim & Sons and another (AIR 1933 Privy Council 58), it was observed:-- "The test of finality is whether the order 'finally disposes of the rights of the parties'. Where order does not finally dispose of those rights, but leaves them 'to be determined by the Courts in the ordinary way', the order is not final. That the order 'went to the root of the suit, namely, the jurisdiction of the Court to entertain it', is not sufficient. The finality must be a finality in relation to the suit. If, after the order, the suit is still a live suit in which the rights of the parties have still to be determined, no appeal lies against it under S. 109(a)".

13. ' Indian Supreme Court too has taken the same view. For instance in M/s. Tarapore & Co., Madras v.

14. M/s. V/O Tractors Export, Moscow and another AIR 1970 SC 1168, it was observed:-- "The expression 'final order' occurring in Art. 133(1) means a final decision on the rights of the parties in dispute in a suit or proceedings; if the rights of the parties in dispute in the suit or proceeding, remain to be tried, after the order, the order is not final."

15. ' In the present case too the impugned order of the High Court does not decide the matter finally and the proceedings still remain to be tried and the rights in dispute between the parties have yet to be determined. Accordingly, the impugned order cannot be deemed to be a final order within the meaning of Article 185(2)(e) of the Constitution, but only an order within the meaning of clause

(3) of Article 185. Hence a petition for leave to appeal is competent against such an order.