REPORTABL E

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 309 OF 2003

Malayalam Plantations Ltd. .... Appellant (s)

Versus

State of Kerala & Anr. .... Respondent(s)

WITH

CIVIL APPEAL NO. 310 OF 2003

J U D G M E N T

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 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

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the appeals arise from the common order of the High

Court, they 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:

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 ‘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.

(b) The appellant filed five applications being OA Nos. 3,

4, 5, 6 and 26 of 1975 before the Forest Tribunal,

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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 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.

(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 of Kerala filed appeals being MFA Nos. 264-268 of

1979 before the High Court of Kerala. The appellant also

filed 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.

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(e) A Full Bench of the High Court, by its judgment dated

29.09.1980, while allowing the appeals filed by the

Government thereby reversing the order passed by the

Tribunal upheld the exemption for the roads and

buildings.

(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 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 employees working in the

estates.

(g) The Tribunal, after hearing both the parties, by a

common judgment dated 15.12.1994, exempted and

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excluded 1400 hectares of land from the vesting

provisions of the Act as areas required for firewood

purposes.

(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, 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

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 Kerala

and Another vs. Pullengode Rubber Produce Co. Ltd.

(1999) 6 SCC 92 holding that such areas should not be

considered for exemption in the absence of proof that they

were actually used in 1971. The Government’s appeal was

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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 Division Bench 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.

(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 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 hectares

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only on the basis of the decision in Pullengode 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 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 Procedure (in short

‘CPC’), the High Court while deciding the 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 Court, by the State as well as Malayalam

Plantations, it is useful to refer the previous decision of

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this Court in Pioneer Rubber Plantation, Nilambur,

Kerala State vs. State of Kerala & Anr. (1992) 4 SCC

175. This Court, after adverting to the definition of

‘private forests’ contained in clause (f) of Section 2 of the

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

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 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 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

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 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.

16. In our view, Section 2(f)(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. In the absence of

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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(f)(1)(i)(B) of the Act as “lands used for any purpose

ancillary to the cultivation of such 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 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

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 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 firewood

needed for smoking purposes will depend on the volume of

rubber to be processed, the yield of the trees, 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 are

relevant in determining the reasonable area that qualifies for

exemption under Section 2(f)(1)(i)(B) of the Act. That is a

matter for consideration by the concerned forest tribunals.

19. In the circumstances, the judgments of the Kerala High

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.

106-107 of 1982; the Forest Tribunal, Palghat with respect

to Civil Appeal No. 2050 of 1981; and the 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.”

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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 Pullengode Rubber

Produce (supra). As rightly pointed by Mr. Rao that

after the order of remand with a specific direction, the

same has no application 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 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 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 employees.

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8) Mr. Gupta, learned senior counsel for the State by

taking 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 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.

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 various rules, we are concerned

about Rule 27 which reads as under:-

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“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 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

(aa) the party seeking to produce additional 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 by him at the time when the decree

appealed against was passed, or

(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 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. “

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 of the High Court to deal with the same on

merits. The above principle 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 SCC 316.

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11) If any petition is filed under Order 41 Rule 27 in an

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 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 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.

12) Adducing additional evidence is in the interest of

justice. Evidence relating to subsequent happening or

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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 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.

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 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.

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14) For the reasons aforesaid, the impugned judgment of

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 law. We also make

it clear that we have not 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

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.

...…………………………………J.

(P. SATHASIVAM)

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...…………………………………J.

(Dr. B.S. CHAUHAN)

NEW DELHI;

NOVEMBER 9, 2010.

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