1. This appeal relates only to an item claimed as to costs. Respondents 1 to 3 herein were the plaintiffs in O. S. No. 45/69 on the file of the Additional Civil Judge, Gulbarga. They filed a suit for recovery of certain sum of money due on accounts against a firm of which the appellant, who was defendant No. 4, and three others, on the ground that they, as partners of the said firm, were liable for the claim. Defendants 1 and 3 entered into a compromise. Accordingly the suit was decreed against them. Defendants 2 and 4 contested the claim of the plaintiffs. The defence of defendant No. 4 was that he was not one of the partners of the firm consisting of defendants 1 to 3 and the claim against him was not sustainable. The Civil Judge came to the conclusion that defendants 1 to 3 were only the partners of the firm and not defendant No. 4. He, therefore dismissed the suit of the plaintiff against defendant No. 4. The learned Civil Judge awarded costs to the plaintiffs against defendants 1 to 3, but dismissed the suit of the plaintiffs against defendant No 4 without costs. In other words, the Civil Judge awarded costs to the plaintiffs who succeeded against defendants 1 to 3, but did not allow costs to defendant No 4, who succeeded against the plaintiffs. The Civil Judge has given no reason for disallowing costs to defendant No. 4.
2. The parties went to trial. Issues were framed, documents were filed and evidence was recorded. The defence by defendant No. 4 was upheld. The learned Civil Judge, therefore, should have awarded costs to defendant No. 4.
3. It was urged by the learned counsel for the plaintiffs that costs are in the discretion of the trial court and that it was beyond the province of the appellate court to interfere with the exercise of that discretion. He quoted number of authorities in support of the position that when the Court of first instance exercised a discretion with reference to costs in a particular way, that should not be interfered with in appeal. To this general proposition, there could be no demur. But the point here is something different. It is one thing to say that when discretion is exercised in one way on particular facts it should not be interfered with by a court of appeal; it is quite different thing to say that even when the court of appeal differs on its view of the facts, it could not interfere with the order for costs made by the trial Court.
4. In Civil Service Co-op. Society v. General Steam Navigation Co., (1903) 2 KB 756 the principles were thus stated by the Earl of Halsbury L.C.:
'No doubt, where a Judge has exercised his. discretion upon certain materials which are before him, it may not be, and I think is not, within the power of Court of the appeal to overrule that exercise of discretion. But the necessary hypothesis of the existence of materials upon which the discretion can be exercised must be satisfied.'
In Kameshwar Singh v. Nebilal Mistri, AIR 1945 Pat 184 it was held that the discretion under Section 35, C. P. C. in the matter of costs is a judicial discretion to be exercised in accordance with definite principles and where it has properly been exercised by the trial court, the appellate court and the High Court in revision will not interfere with the exercise of that discretion. But where a question of principle is involved, the High Court will interfere in revision with orders for costs.
5. Section 35, C. P. C. deals with court's powers regarding costs and substantial portion of the section directs that costs shall be in the discretion of the court. Sub-section (2) provides that where the court directs that costs shall not follow the event, the court shall state its reasons in writing. The general rule is that costs shall follow the event unless the court, for good reasons, otherwise orders. It follows that the successful party is entitled to costs unless he is guilty of misconduct or there is some other good cause for not awarding costs to him. In the present case, at the earliest moment, defendant No. 4 took up the defence that he was not a partner of the firm against which the claim had been brought by the plaintiffs. At the early stage itself necessary documents were produced which disclosed that this defendant was not a partner of the said firm. Even thereafter the plaintiffs prosecuted the suit against defendant No. 4 and ultimately it was held that defendant No. 4 was not a partner of the said firm and he was not liable to the claim of the plaintiffs. Under these circumstances, the trial Court, without giving any reason and without applying its mind to the facts of the case, has disallowed costs to defendant No. 4. The trial Court, therefore, has not exercised its discretion upon materials which were before it. I am aware of the discretion that is given to courts in fixing costs but such discretion must be based on legal principles consistent with justice and reason. I do not think that the trial court was justified in depriving defendant No. 4 of his costs to which he was entitled.
6. For these reasons I hold that the learned Civil Judge was not justified in disallowing costs to defendant No. 4. I, therefore, allow this appeal with costs.
7. Appeal allowed.