MALAYALAM PLANTATIONS LTD.versusSTATE OF KERALA AND ANR.

                  [2010] 14 (ADDL.) S.C.R. 162


A               MALAYALAM PLANTATIONS LTD.
                                 v.
                 STATE OF KERALA AND ANR.
                 (Civil Appeal No. 309 of 2003)
                       NOVEMBER 9, 2010
B
        [P. SATHASIVAM AND DR. B.S. CHAUHAN, JJ.]

       Code of Civil Procedure, 1908: 0.41, r.27 - Production
  of additional evidence in appellate court - Held: It is
C incumbent on the part of the appellate court to consider the
  relevance of the additional documents/evidence with regard
  to the issues involved - Situations in which additional
  evidence can be adduced - Discussed - Additional evidence
  cannot, however, be adduced to fill in the lacunae or to patch
D up the weak points in the case.
      Practice and Procedure: Remand of case for decision -
  Order of remand with specific directions - Scope for
  adjudication on remand - Kera/a Private Forests (Vesting
E and Assignment) Act, 1971.
      On the enactment of the Kerala Private Forests
  (Vesting and Assignment) Act, 1971, all private forests
  vested in the State of Kerala. The appellant-private
  company owned 5 estates in the State of Kerala. An area
F of 5131 hectares of land in possession of appellant's
  estate was, therefore, deemed to have vested in the
  State.
      The appellant filed applications before the Forest
G Tribunal seeking exclusion of 2588 hectares of its estate
  from the purview of the Act on the ground that the said
  area of land was either planted with eucalyptus prior to
  the vesting or were utilized for the purpose of fuel
  requirement for its factory and for the use of its
H                               162
   MALAYALAM PLANTATIONS LTD. v. STATE OF               163
             KERALA AND ANR.
employees. The Tribunal allowed the applications. On           A
appeals, the High Court held that the lands occupied by
the staff quarters, clubs etc. were to be excluded under
the Act. The matter came up before the Supreme Court.
By order dated 24.8.1992, the Supreme Court set aside
the order of the High Court and remanded the matter to         B
the Tribunal with a direction to determine and exempt the
extent of land required by the appellant for the purpose
of growing trees for firewood purposes for its factory as
well as for the employees working in the estates.

     The Tribunal excluded 1400 hectares of land from the      C
vesting provisions of the Act as areas required for
firewood purposes. The State appealed before the High
Court. The appellant also filed cross-appeal. The High
Court exempted 730.58 hectares of eucalyptus lands from
vesting but held that no forest areas could be exempted        D
for the purpose of firewood in view of the decision of the
Supreme Court in *Pul/engode Rubber Produce.

     In the instant appeals, it was contended by both the
parties that the order of the High Court was not correct       E
and that separate applications were filed by them under
Order 41 Rule 27, CPC for reception of material
documents as additional evidence, however, the High
Court while deciding the appeal failed to consider the
same though adverted to them in the course of                  F
discussion.

    Partly allowing the appeals, the Court

     HELD: 1. In view of the directions in the remand orde:
dated 24.8.1992, the High Court was not justified in           G
relying on the decision in *Pullengode Rubber Produce.
After the order of remand with a specific direction, the
said decision had no application to the facts of the instant
case·. [Para 6) [171-E-F]
                                                               H
    164 SUPREME COURT REPORTS (2010] 14 (ADDL.) S.C.R.

A       *State of Kera/a and Another v. Pullengode Rubber
    Produce Co. Ltd. (1999) 6 SCC 92 - referred to.

       2.1. Order 41, CPC speaks about procedure in
  respect of disposal of appeals from original decree. If any
8 petition is filed under Order 41 Rule 27 in an appeal, it is
  incumbent on the part of the appellate court to consider
  the same at the time of hearing the appeal on merits so
  as to find out whether the documents or evidence sought
  to be adduced have any relevance/bearing in the issues
C involved. Under Order 41, Rule 27, additional evidence
  could be adduced in one of the three situations, namely,
  (a) whether the trial court has illegally refused the
  evidence although it ought to have been permitted; (b)
  whether the evidence sought to be adduced by the party
  was not available to it despite the exercise of due
D diligence; (c) whether additional evidence was necessary
  in order to enable the appellate court to pronounce the
  judgment or any other substantial cause of similar nature.
  It is equally well-settled that additional evidence cannot
  be permitted to be adduced so as to fill in the lacunae or
E to patch up the weak points in the case. [Para 9, 11] [172-
    E; 173-E-H]
         Jatinder Singh & Anr. v. Mehar Singh & Ors. AIR 2009
    SC 354; Shyam Gopa/ Bindal and Others v. Land Acquisition
F   Officer and Another (2010) 2 SCC 316 - relied on.

       2.2. Adducing additional evidence is in the interest of
  justice. Evidence relating to subsequent happening or
  events is relevant for disposal of the appeal, however, it
  is not open to any party, at the stage of appeal, to make
G fresh allegations and call upon the other side to admit or
  deny the same. Any such attempt is contrary to the
  requirements of Order 41, Rule 27. The High Court would
  restore to its file the appeal filed by the State and the
  cross-appeal filed by the appellant and dispose of the
H same expeditiously. In the light of the separate
   MALAYALAM PLANTATIONS LTD. v. STATE OF                165
             KERALA AND ANR.
applications filed under Order 41, Rule 27 for reception        A
of additional evidence by both sides, it is for the High
Court to consider and take a decision one way or other
as to the applicability of the same and decide the appeal
with reference to the said conclusion. [Paras 12, 13] (174-
A-C]                                                            B
     Pioneer Rubber Plantation, Nilambur, Kera/a State v.
State of Kera/a & Anr (1992) 4 SCC 175 - referred to.

                    Case Law Reference:
                                                                c
    (1999) s sec 92          referred to          Plira 2(i),
                                                  4, 6
    (1992) 4 sec 115         referred to          Para 5
    AIR 2009 SC 354          relied on            Para 10       D
    c2010) 2 sec 316         relied on            i'ara 10
     CIVIL APPELLATE JURISDICTION: Civil Appeal No. 309
of 2003.

    From the Judgment & Order dated 31.5.2002 of the High       E
Court of Kerala at Ernakulam in MFA No. 537 of 1995.

                           WITH

C.A. No. 310 of 2003                                            F
     L. Nageswara Rao, C.N. Sree Kumar, Hari Kumar G., for
the Appellant.

    Jaydeep Gupta, G. Prakash, M.P. Prakash for the
Respondents.                                                    G

    The Judgment of the Court was delivered by

     P. SATHASIVAM, J. 1. These appeals are directed
against the judgment and decree dated 31.05.2002 passed by
the High Court of Kerala at Ernakulam in MFA No. 537 of 1995    H
    166   SUPREME COURT REPORTS [2010] 14 (ADDL.) S.C.R.


A and Cross Appeal whereby the High Court modified the order
  dated 13.03.1979 of the Forest Tribunal, Kozhikode. Malayalam
  Plantations Ltd. has filed C.A. No. 309 of 2003 and the State
  of Kerala preferred C.A. No. 310 of 2003. Since both the
  appeals arise from the common order of the High Court, they
B are being disposed of by this common judgment. For
  convenience, we shall refer Malayalam Plantations Ltd. as
  appellant and the State of Kerala as Respondent.

    Brief facts:

C      2) (a) The appellant is a Limited Company, which owns 5
  estates in South Wayanad Taluk in Kerala. It engaged
  principally in the cultivation of Tea, Coffee, Cocoa, Rubber,
  Cardamom and Cinnamon. The Kerala Private Forests
  (Vesting and Assignment) Act, 1971 (hereinafter referred to as
D 'the Act') came into force with 10.05.1971 as the appointed day
  providing for vesting of all private forests in the State of Kerala.
  An area of 5131 hectares of land which was in the possession
  of the appellant's Wayanad Estates in Wayanad District of
  Kerala State was deemed to be vested under the said Act.
E
        (b} The appellant filed five applications being OA Nos. 3, \
  4, 5, 6 and 26 of 1975 before the Forest Tribunal, Kozhikode
  in respect of its 5 Wayanad Estates challenging the vesting of
  2588 hectares out of the 5131 hectares which were either
  planted with eucalyptus by the appellant prior to the vesting or
F were utilized for the purpose of fuel requirement for its factory
  and for the use of its employees. No application was filed for
  the balance 2543 hectares as it formed part of the forest and
  finally vested with the Government.

G        (c} By a common order dated 13.03.1979, the Forest
    Tribunal, Kozhikode exempted the entire 2588 hectares from
    the vesting provisions of the Act.

      (d) Aggrieved by the order of the Forest Tribunal, the State
H of Kerala filed appeals being MFA Nos. 264-268 of 1979
   MALAYALAM PLANTATIONS LTD. v. STATE OF                      167
     KERALA AND ANR. [P. SATHASIVAM, J.]
before the High Court of Kerala. The appellant also filed             A
appeals being MFA Nos. 209-214 of 1979 claiming that
exemption was granted only on the ground of estoppel on
account of collection of land tax for the areas involved even after
the vesting and other grounds urged was not accepted by the
Tribunal.                                                             B

     (e) A Full Bench of the High Court, by its judgment dated
29.09.1980, while ailowing the appeals filed by the Government
thereby reversing the order passed by the Tribunal upheld the
exemption for the roads and buildings.
                                                                      c
      (f) Challenging the order of the Full Bench, the appellant
filed 5 Appeals being C.A. Nos. 557-561 of 1981 before this
Court. The State Government also preferred appeals being
Civil Appeal Nos. 1214-1218 of 1981. By a judgment dated
24.08.1992, this Court set aside the judgment of the Kerala           D
                     '
High Court and remanded      the O.A. Nos. 3, 4, 5, 6 and 26 of
1975 to the Forest Tribunal, Kozhikode with a direction to
determine and exempt the extent of land required by the
appellant for the purpose of growing trees for fuel requirement
i.e. firewood purposes for its factory as well as for the             E
employees working in the estates.

    (g) The Tribunal, after hearing both the parties, by a
common judgment dated 15.12.1994, exempted and excluded
1400 hectares of land from the vesting provisions of the Act
as areas required for firewood purposes.                              F

      (h) When the appellant was pursuing with the authorities
for implementing the order of the Tribunal, the State of Kerala
filed MFA No. 537 of 1995 before the High Court, challenging
the judgment dated 15.12.1994 passed by the Forest Tribunal,          G
Kozhikode. On 02.07.1995, a Cross Appeal was filed by the
appellant in the above said appeal of the Government.

    (i) A Division Bench of the High Court of Kerala, by its
impugned judgment dated 31.05.2002 exempted 730.58
                                                                      H
    168 SUPREME COURT REPORTS (2010] 14 (ADDL.) S.C.R.


A hectares of eucalyptus lands from vesting but held that no forest
  areas could be exempted for the purpose of firewood in view
  of the decision of this Court in State of Kera/a and Another vs.
  Pullengode Rubber Produce Co. Ltd. (1999) 6 SCC 92
  holding that such areas should not be considered for exemption
B in the absence of proof that they were actually used in 1971.
  The Government's appeal was partially allowed and the
  appellant's Cross Appeal claiming the whole area was
  dismissed. Since the Cross Appeal filed by the appellant is
  dismissed and appeal filed by the State was allowed by the
c Division Ben.ch by the impugned judgment, both the appellant
  and the State Government have filed the above appeals.

         (3) Heard Mr. L. Nageswara Rao, learned senior counsel
    for the Malayalam Plantations Ltd and Mr. Jayadeep Gupta,
    learned senior counsel for the State of Kerala.
D
        (4) Mr. L.N. Rao, after taking us through earlier remand
  order of this Court dated 24.08.1992 and the impugned
  judgment of the High Court dated 31.05.2002 submitted that
  the High Court erred in not appreciating the fact that the remand
E order dated 24.08.1992 only required the Tribunal to ascertain ,
  the area for the purpose of exemption commensurate with the
  area of plantation and fuel requirement of the appellant as on
  10.05.1971. He also pointed out that the High Court was not
  justified in reducing the limit of the exempted land to 730.58
F hectares only on the basis of the decision in Pul/engode
  Rubber Produce (supra). According to him, it has no application
  to the facts of the appellant's case. On the other hand, Mr.
  Gupta, learned senior counsel for the State by drawing our
  attention to various materials in the form of oral and
G documentary evidence submitted that the High Court was
  not justified in granting exemption of 730.58 hectares of land
  in favour of the appellant Company. He also pointed out that
  though the State Government has filed separate application for
  reception of material documents as additional evidence by
  filing application under Order 41 Rule 27, Code of Civil
H
   MALAYALAM PLANTATIONS LTD. v. STATE OF                     169
     KERALA AND ANR. [P. SATHASIVAM, J.]
Procedure (in short 'CPC'), the High Court while deciding the        A
Regular First Appeal failed to consider the same though
adverted to in the course of discussion.

     5. Before considering the additional materials sought to
be produced at the appellate stage, namely, before the High          8
Court, by the State as well as Malayalam Plantations, it is useful
to refer the previous decision of this Court in Pioneer Rubber
Plantation, Nilambur, Kera/a State vs. State of Kera/a & Anr.
(1992) 4 SCC 175. This Court, after adverting to the definition
of 'private forests' contained in clause (f) of Section 2 of the     C
Act and the claim of both the parties remanded the matter with
the following conclusion:-

    "14. The entire purpose of exclusion of the items set out
    in the foregoing paragraph from the scope of the definition
    of 'private forest' seems to be not to hinder or create any      D
    difficulty in the functioning of plantations of tea, coffee,
    cocoa, rubber, cardamom and cinnamon as viable
    commercial enterprises. In these circumstances, it
    appears reasonable that the minimum area required for
    the purpose of growing firewood trees for fuel in the            E
    factories and smoke-houses as well as for supply to the
    employees of the estates for their domestic use should be
    excluded from the definition of the term 'private forest'. We
    must. however, emphasize that the burden is on the
    appellants to show that it has been their practice to supply     F
    firewood to the employees of the estates for their domestic
    use. As for the firewood required for the factories and
    smoke-houses in the estates, there seems to be no doubt
    about the claim of the appellants.

    15. However, where evidence had been led to show that            G
    firewood was steadily and, adequately available in the
    market at reasonable rates for use of the factories or
    smoke-houses as well as for supply to the workers of a
    particular plantation, in such a case no land could be
    excluded from the definition of the private forest on the        H
    170     SUPREME COURT REPORTS (2010] 14 (ADDL.) S.C.R.


A         ground that it was required for growing firewood trees for
          the purpose of the estate as well as for the workers. That,
          however, is not the position in the case before us. On the
          pleadings and evidence before us, we do not consider that
          any further inquiry on the point is necessary.
B
          16. In our view, Section 2(1)(1 )(i)(B) should be so
          understood as to grant exemption in respect of lands on
          which firewood trees are necessary to be grown for steady
          supply of a reasonable quantity of fuel to the employees
          as well as to the smoke-houses or factories in the estates.
c         In the absence of satisfactory evidence to show that
          firewood is adequately and steadily available in the market
          at reasonable prices, such lands, in our view, qualify for
          exemption under Section 2(t)(1 )(1)(8) of the Act as "lands
          used for any purpose ancillary to the cultivation of such
0         crops or for the preparation of the same for the market".
          This principle, in our view, must hold good in relation to all
          crops mentioned under the aforesaid provision. The
          Tribunal shall merely ascertain as to what is the minimum
          reasonable area of land required for growing firewood
E         trees to be used as fuel in the factories or smoke-houses
          and for supply to the employees for their domestic
          purposes, if such supply to the latter is proved, and to
          exclude such area in demarcating private forest.

          17. What exactly is the area which can be reasonably
F
          regarded as required for growing firewood trees for the
          aforesaid purposes so as to qualify for exemption from
          vesting under the Act is a question of fact which has to be
          determined with reference to various factors. Some of
          these factors are mentioned by the larger Bench of the
G         High Court in the following words:

          "32. The next point is what area of the jungle land could
          be excluded on the above basis? A precise assessment
          will almost be impossible, because the quantum of
H         firewood needed for smoking purposes will depend on the
   MALAYALAM PLANTATIONS LTD. v. STATE OF                     171
     KERALA AND ANR. [P. SATHASIVAM, J.]
     volume of rubber to be processed, the yield of the trees,       A
     the quality of the wood and other factors. The best solution
     seems to be to make an approximate assessment as was
     made by the Taluk Land Board in Ammad case."

     18. We do not express any final view as to what factors
                                                                     8
     are relevant in determining the reasonable area that
     qualifies for exemption under Section 2(f)(1 )(1)(8) of the
     Act. That is a matter for consideration by the concerned
     forest tribunals.

     19. In the circumstances, the judgments of the Kerala High      C
     Court impugned in these appeals are set aside and the
     cases are remanded to the appropriate forest tribunals:
     namely, the Forest Tribunal, Manjeri with respect to Civil
     Appeal Nos. 106-107of1982; the Forest Tribunal, Palghat
     with respect to Civil Appeal No. 2050 of 1981 ; and the         D
     Forest Tribunal, Calicut with respect to Civil Appeal Nos.
     557-61 and 1214-18 of 1981. The Tribunals shall
     determine the extent of the lands required, as aforesaid,
     for fuel for the smoke-houses or factories as well as for
     the employees in the estates."                                  E

     6. In view of the directions in the remand order, we are of
the view that the High Court is not justified in relying on the
earlier decision of this Court in Pul/engode Rubber Produce
(supra). As rightly pointed by Mr. Rao that after the order of
remand with a specific direction, the same has no application        F
to the facts of the present case. To this extent, we clarify the
same.

     7. It is not in dispute that when the appeals of the State as
well as of the Malayalam Plantations were pending before the         G
High Court, the State filed CMP No. 8793 of 2001 for accepting
Annexures A1 to A21 in support of their claim stating that at
the relevant time, the Company is in possession of an extent
of 1199 .3579 hectares of land other than plantation for ancillary
purposes In the counter affidavit filed by the Plantations           H
    172    SUPREME COURT REPORTS (2010] 14 (ADDL.) S.C.R.


A   Company, the Company put forth their case and produced
    Annexure R1 in support of their stand claiming more extent of
    land for the use of their employee·s.

       8. Mr. Gupta, learned senior counsel for the State by taking
B us through the various documents filed in the said CMP
  demonstrated that if we consider the contents of the same, the
  entire claim of the Malayalam Plantations is to be rejected. He
  further submitted that in view of the fact that Order 41 Rule 27
  of CPC enables the parties to place documents in support of
C their claim as additional evidence, the High Court though
  adverted to did not consider the same and no order was
  passed in the said CMP No. 8793 of 2001. Mr. Rao pointed
  out that if this Court scrutinizes each and every document, the
  claim of the State is to be rejected in toto and the stand of the
  appellant is to be accepted.
0
       9. We are not inclined to go into the validity or acceptability
  of those documents/materials filed by both sides before the
  High Court. Order 41 of CPC speaks about procedure in
  respect of disposal of appeals from original decree. Among
E various rules, we are concerned about Rule 27 which reads as
  under:-

          "27. Production of additional evidence in Appellate
          Court.-(a) The parties to an appeal shall not be entitled
          to produce additional evidence, whether oral or
F
          documentary, in the Appellate Court. But if-

          (a) the Court from whose decree the appeal is preferred
          has refused to admit evidence which ought to have been
          admitted, or
G
          (aa) the party seeking to produce adqitional evidence,
          establishes that notwithstanding the exercise of due
          diligence, such evidence was not within his knowledge or
          could not, after the exercise of due diligence, be produced
H         by him at the time when the decree appealed against was
   MALAYALAM PLANTATIONS LTD. v. STATE OF                       173
     KERALA AND ANR. [P. SATHASIVAM, J.]
     passed, or                                                        A

     (b) the Appellate Court requires any document to be
     produced or any witness to be examined to enable it to
     pronounce judgment, or for any other substantial cause,

     the Appellate Court may allow such evidence or document           8
     to be produced, or witness to be examined.

     (2) Wherever additional evidence 'is allowed to be
     produced by an Appellate Court, the Court shall record the
     reason for its admission. "                                       C

     10. In view of the above provision, in our opinion, when an
application for reception of additional evidence under Order 41
Rule 27 of CPC was filed by the parties, it was the duty af the
High Court to deal with the same on merits. The above principle        D
has been reiterated by this Court in Jatinder Singh & Anr. Vs.
Mehar Singh & Ors. AIR 2009 SC 354 and Shyam Gopal
Bindal and Others vs. Land Acquisition Officer and Another,
(2010) 2 sec 316.

        11. If any petition is filed under Order 41 Rule 27 in an      E
appeal, it is incumbent on the part of the appellate Court to
consider at the time of hearing the appeal on merits so as to
find out whether the documents or evidence sought to be
adduced have any relevance/bearing in the issues involved. It
is trite to observe that under Order 41, Rule 27, additional           F
evidence could be adduced in one of the three situations,
namely, (a) whether the trial Court has illegally refused the
evidence although it ought to have been permitted; (b) whether
the evidence sought to be adduced by the party was not
available to it despite the exercise of due diligence; (c) whether     G
additional evidence was necessary in order to enable the
Appellate Court to pronounce the judgment or any other
substantial cause of similar nature. It is equally well-settled-that
additional evidence cannot be permitted to be adduced so as
to fill in the lacunae or to patch up the weak points in the case.
                                                                       H
    174    SUPREME COURT REPORTS [2010] 14 (ADDL.) S.C.R.


A       12. Adducing additional evidence is in the interest of
  justice. Evidence relating to subsequent happening or events
  which are relevant for disposal of the appeal, however, it is not
  open to any party, at the stage of appeal, to make fresh
  allegations and call upon the other side to admit or deny the
B same. Any such attempt is contrary to the requirements of
  Order 41 Rule 27 of CPC. Additional evidence cannot be
  permitted at the Appellate stage in order to enable other party
  to remove certain lacunae present in that case.

C      13. In the light of the separate application filed under Order
  41 Rule 27 of CPC for reception of additional evidence by both
  sides, it is for the High Court to consider and take a decision
  one way or other as to the applicability of the same and decide
  the appeal with reference to the said conclusion. In this view of
  the matter, we refrain from going into the merits of the materials
D placed by both sides and it is for the High Court to consider
  and take a decision one way or other as· per the mandate of
  the said provision.

        14. For the reasons aforesaid, the impugned judgment of
E the High Court is set aside. We make it clear that we have not
  gone into the merits as to whether application for reception of
  additional evidence under Order 41 Rule 27 of the CPC should
  be allowed or not, which shall be decided by the High Court in
  accordance with la~. We also make it clear that we have not
F gone into the merits of the claim made by both parties except
  the reasons indicated in the earlier paragraphs. Considering
  the facts and circumstances of the case, more particularly, the
  issue is pending from 1975, we request the High Court to
  restore MFA No. 537 of 1995 and Cross Appeal on its file and
G dispose of the same at an early date preferably within a period
  of six months from the date of receipt of copy of this judgment.
  Civil Appeals are allowed to the extent indicated above,
  however, with no order as to costs.

    D.G.                                   Appeals partly allowed.