1. On November 1, 1968, this appeal was before us and we had held that on the memorandum of appeal and the cross-objection, both the sides were liable to pay ad valorem court-fees on the amount either decreed or disallowed. A note was subsequently filed that to such a case the provisions of article 13 of Schedule II of the Bombay Court-fees Act, 1959 (hereinafter referred to as the Act), should be applicable and not Schedule I, article 1 or 7 of the said Act as held by us. We have, therefore, reheard, the matter.
2. The order in the present case is made in a winding up proceeding under circumstances which we have already stated in our order dated November 1, 1968. The two provisions which are relevant for the present purposes and which need be considered are Schedule I, article7, and Schedule II, article 13 of the said Act. Schedule I, article 7 , of the Act, read as follows:
'7. Any other plaint, application or petition (including memorandum of appeal), to obtain substantive relief capable of being valued in terms of monetary gain or prevention of monetary loss, including cases wherein application or petition is either treated as a plaint or is described as the mode of obtaining the relief as aforesaid.
A fee on the amount of the monetary gain or los to be prevented. according to the scale prescribed under article I'
2. Schedule II, article 13 of the said Act reads as follows:
'13. Memorandum of appeal.- When the appeal is not from a decree or an order having the force of a decree, and is presented-
to any Civil Court other than the High Court, or to any Revenue Court of Executive Officer other than the High Court or Chief Controlling Revenue or Executive Authority; One Rupee.
b) to the Chief Controlling Executive or Revenue Authority; Two rupees and fifty paise.
c) to the High Court. Five Rupees.'
3. As we have recently observed in similar case, Indumati v. Union of India, the said Act has been recast in 1959 and the Indian Court-fees Act, 1870, is no longer applicable to this State. We will consider the question in the first in stance on first principles without referring to authorities.
4. In order that Schedule II, article 13 of the said Act should apply, the appeal must be from an order and not from a decree or an order having the force of a decree and must be presented to the various authorities mentioned in column 2 of the said article. The question then is whether the order passed by the learned judge under the Companies Act in a winding up proceeding is a decree or an order having the force of a decree.
5. It is argued that the Court-fees Act being a taxing statute must be strictly construed. There can be no quarrel with the principle. But it is equally well settled that every statute must be reasonably construed, and if a case is brought within a particular provision it must be applied. It is only if there is ambiguity that the question of strict construction in favour of the citizen can arise.
6. In order that the order should be a degree under the Civil Procedure Code, the proceedings must commence by a plaint, and a defined by section2(2) of said code, there must be a 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, as regards the court expressing it. This is sine qua non for an order being a decree. In a winding up proceeding, when an order is made it may in some cases indeed decide the rights between the company and the third person whether he is an outsider or a shareholder or an officer of the company. The proceedings, however, are not like proceedings in a suit, though the court may have got powers analogous to those in a suit for deciding the question at issue between the two parties and there may not necessarily be a formal expression of the adjudication as understood under the Code of Civil Procedure as in the case of a decree. An order means a formal expression of a decision which is not a decree. In order that a decision should be an order, no particular form of order could be prescribed. Each case must depend upon its own facts. The order in the present case is:
'The trustees of the debenture-holders shall get Rs. 7,691.61paise from the official liquidator as the costs and expenses incurred by them fro the period for which they were in possession of the mill. The remaining portion of the claim made by them in exhibit 285 is dismissed. The above amount shall be adjusted against the claim of the liquidator against the trustees in Miscellaneous Application No. 120 of 1955, in which delivered judgment today. There will be no order as to costs in the present enquiry.'
7. Clearly, though the order is not an order under the Civil Procedure Code, it is still an order, which can be enforced and is conclusive and final unless appealed from.
8. When the words 'a decree or an order' are used in Schedule II article 13 of the Act, it could not have been intended by the legislature to confine the words to decrees or orders only of the civil courts, inasmuch as (article column 2 shows that it is intended to apply to any memorandum of appeal presented either to any civil courts, or to any revenue court of executive officer or chief controlling revenue or executive authority. That this should be the intention of the legislature is further supported from the other provisions of Schedule I of the act. For example, article 3, schedule relates to an award made under the Arbitration Act, 1940. Article relates to plaint, application or petition or memorandum of appeal capable of being treated as a suit to set aside a decree or order having the force of a decree Article 7 is a general omnibus article which prescribes court-fees for any other plaint, application or petition to obtain substantive relief capable of being valued in terms of monetary gain or prevention of monetary loss including within it cases where an application or petition is either treated as a plaint or is described as the mode of obtaining the relief. By article 15 a further innovation is made by requiring one-half of the court-fees to be paid for an application to the collector for making reference to the court under section 18 of the Land Acquisition Act, though under the old Act there was no such provision. By article 16 an application or petition made by an assesses under the Income-tax Act s also brought within the purview of the Act of 1959 by requiring one-half to ad valorem court-fees to be paid . Article 17 similarly provides for ad valorem court-fee to be paid in a mater under the Sales Tax Act. It is therefore, in this setting that one has to determine the meaning of the orders' an order having the force of a decree contained in article 13 of Schedule II of the act.
9. In considering the expression ' an order having the force of a decree the court must be guided by the substance of the matter and not merely by the form. The relevant provisions which need be considered in connection with an order made in winding up proceedings are sections 634, 635, 482 and 483 of the Companies Act, 1956. Section 634 reads as follows:
' Any order made by a court under this Act may be enforced in the same manner as a decree made by the court in a suit pending therein.'
10. Section 635 reads as follow:
'1) Where any order made by one court is required to be enforced by another court, a certified copy of the order shall be produced to the proper officer to the court required to enforce the order.
2) The production of such certified copy shall be sufficient evidence of the order.
3) Upon the production of such certified copy, the court shall take the requisite steps for enforcing the order, in the same manner as if it had been made by itself.'
11. In relation to winding up proceedings, section 482 of the Companies Act supplements the provision of section 634 by providing for enforcement of the said order by any court other than the court which has made the order. The provisions of this section are in terms similar to those of section 38 of the Code of Civil Procedure. Section 483 reads as follows:
' Appeals from any order made, or decision given, in the matter of the winding up of a company by the court shall lie to the same conditions under which, in the same manner in which, and subject to the same conditions under which, appeals lie from any order or decision of the court in cases within its ordinary jurisdiction.
The question then arises as to whether in substance there is any distinction between an order creating liability made by the court in winding up proceedings granting substantive relief capable of being valued in terms of monetary gain or prevention of monetary loss and a decree of the civil court granting similar relief. The substance of the matter is that, when an order is made it is enforceable in exactly the same manner as a decree and it s appealable in the same manner and to the same extent as a decree. Moreover, as in the case of a decree, such order of the court in winding up proceedings is binding, which means that the question decided therein cannot be reagitated. Under this circumstances, is it possible to say that such an order made by the court has not the force of a decree, and if the answer is in the affirmative , the further question that will have to be answered is, why? Neither Mr. Albal nor Mr. Lalit has been able to point out in what manner such order of the court is in any way different from a decree of the civil court except that one is rendered in winding up proceedings of a company and the other in suit by the civil court. That, however, cannot take away effect of such order made and in our view it is impossible to say that such order made in winding up proceedings has not the force of a decree.
12. One substantial and important test is whether in the case of an order for payment of money in winding up proceedings retable payment can be claimed under section 73 of the Code of Civil Procedure, which in specific terms deals with the questions of retable distribution between different decree-holders. This question came up for consideration before the Judicial Committee in Lyallpur Bank Ltd. v. Ramji Da. In the case, one Shantilal was indebted to several persons. In one of the execution proceedings of a decree holder. the court had recovered a sum of Rs. 49, 166 and the other decree-holders had applied for retable distribution amongst them of the sum. It also appears that in the winding up proceedings against the Lyallpur Bank Ltd., order was made by the district judge against Shantilal directing him to make payment of Rs. 1,37,557-10-3 as successor of the original controlibutory. This order was forwarded by the Deputy Registrar of the Chief Court of Oudh to the district judge for execution and necessary action. The district judge as well as the Chief Court held that an order under section 186 of the Indian Companies Act, 1913, did not come with definition of the word 'decree' contained in section 2(2) of the Code of the Civil Procedure , and therefore a holder of such an order could not fulfill the requirements of section 73 of being within the class of persons who had ' made application to the court for the execution of decrees.' The Lahore High Court was concerned with a provision similar to the provisions of section 634 under the Companies Act, 1956. The Judicial Committee held that the view taken by the court below was a very narrow view and that an application under section 73 of the code made by the company must be deemed to be an application for execution of a decree for the purpose of that section/ The Judicial Committee approved the earlier decision of the Lahore High Court in Radhesham Beopar Co. v. Karan Chand. In substance, therefore, we do not find any difference between a decree and an enforceable order made in winding up proceedings. We are, therefore, constrained to hold that such an order has the force of a decree.
13. On behalf of the appellants and the respondent out attention was invited, firstly, to the decision in Reference under section 28 of Act No.VII of1870. In that case under the old Companies Act it seems an order was made by the district judge under section 214 against the directors of the bank in question for payment into court certain amount and an appeal was filed from that order. As the question of the court-fee arose, the matter was referred by the district judge to the High Court. The learned Judge, after having observed that it was doubtful whether any 'order' in the strict sense of that word as defined in the Code of Civil Procedure was passed by the winding up court under section 214 of the Companies Act, held that there was difference between the expressions 'force of a decree' and ' the method of enforcing it' and, therefore, the case fell within article 11,Schedule II of the Indian Court-fees Act. The learned judge observed that the order was not made in a suit; that the proceedings did not commence by a plaint and that there was no inquiry as contemplated by the Civil Procedure. With great respect, we do not find anything in the reasoning to suggest in what manner except in the process of its making the order, which was a final and conclusive order, was different from a decree in its effect.
14. Reference has been made to a decision of Nanabhai Haridas J. in this court in Nawab of Bela Spinning and Weaving Co. Ltd. v. Atmaram Parbhud, where the learned judge has disposed of the whole question in two lines. The question related to an order regarding the rectification of company's register. The question at an issue in the present case did not arise in that case. Such orders may or may not amount to decrees and the claim may not be capable of valuation which question do not decide.
15. The next important case referred to is Official Liquidator , Universal Bank Ltd. v. M.U. Qureshi which is a decision of a Full Bench, the leading judgment being of Sale J. It arose under somewhat similar provisions of the Indian Companies Act,1913. The learned judge has made a distinction between 'having the force' and 'mode of enforcement'. The learned judge further observed:
An order that is given by statute the force of a decree is an order that proprio vigore stands as a decree whatever the consequences, whereas an order that may by statute be enforced as a decree is an order that may be of little or no effect, proprio vigore, and only becomes effective, when executed by the method by which a decree may be executed.
16. In other words, it is a mere shadow unless and until life is infused into it by an application for execution.
17. With great respect the same must apply to a decree. Even a decree obtained by a party is valueless unless enforced by him. The same is the case with an order made under the Companies Act. In both the cases unless the orders are enforced, the person against whom the orders are made is not touched and qua him both the orders are lifeless. The distinction, therefore, pointed out is a distinction not of substance but of form. On the other hand, as we have pointed out, an order made against any person is winding up proceeding is binding and is as conclusive, subject to the result of the appeal, as any ordinary decree. If a question arises between the parties the decision can be called in aid to prevent agitation of the question which has been already decided by that order. That being so, it is difficult to appreciate any distinction of substance between the two kinds of orders.
18. In the above case even though the other two learned judges expressed entire agreement with the judgment of Sale J. Martern J. added rider saying:
'In view of the distinction we have drawn between orders having the force of a decree within he meaning of article11, Schedule II, court- fees Act, and orders enforced in the same manner in which decrees may be enforced, it follows that if any order made under the Companies Act is intrinsically of the nature of an order having the force of a decree t will not fall under Schedule II, article 11, Court-fees Act, even thought it may be enforceable, by virtue of section 199, Companies Act, and appealable under section 202 of the Act. It will therefore be necessary in future for the appropriate authority to decide in each case whether or not the order has the force of a decree in order to determine the amount of court-fee to be affixed.'
19. We are in respectful agreement with these observation of the learned judge that each case must be decided on its own facts to determine as to which order has the force of a decree. If it has the same effect as a decree when a question of liability is determined and substantive relief is granted then Schedule II, article 13 of the Act of 1959 cannot possibly apply.
20. The other decision relied on the point and referred top by Mr. A,bal and Mr. Lalit was Dundappa v. S.G. Motor Transport Co. The reasoning adopted n this decision is the same as that adopted by Sale J. in official Liquidator, Universal Banks Ltd., v. M.U. Qureshi and suffers, with great respect from the same infirmity.
21. Mr. Lalit then referred us to a decision of Shah J. sitting singly in Taxing Officer v. Jamnadas where the learned judge considered the question of court-fees vis-a-vis an order made under the Displaced persons (Debts Adjustment) Act, 1951, and held that the court fee was payable under the Schedule II,. article 11 of the old Act corresponding to Schedule II, article 13 of the Act of 1959. The wording n the Act as to the effect of the order in that case was entirely different and not as in the present case. Under the circumstances, the authority will not have any relevance to the point at issue. Even then the question under the new Act of 1959 may have to be decided.
22. This order will govern the cross-objection filed by the appellants.
23. Mr. Government Pleader has asked for costs of this hearing. As, however, the position of law was not very clear under the Act of 1959, we do not think it is desirable to award costs in these matters.
24. By our order dated November 1, 1968, w4e had given fifteen days time to both the appellants and the respondent to pay the court-fees on the appeal memo and cross-objections. More than one month has passed till now. Even though the question had to be argued the parties ought to have been ready for payments of the court-fees. We, therefore, thing that it is reasonable to grant only ten days for payment of the court-fees to both the parties.