Source: Supreme Court 

Why in News? 

A bench of Justice JB Pardiwala and Justice R Mahadevan laid down principles to be followed for impleading a transferee pendente lite.               

• The Supreme Court held this in the case of H. Anjanappa v. A. Prabhakar & Ors. (2025). 

What was the Background of the H. Anjanappa v. A. Prabhakar & Ors.  Case? 

• Ownership & Agreement of Sale (1995):  
  • Late Smt. Daisy Shanthappa (Defendant No.1) owned two adjacent lands in Bagalur Village.  
  • She agreed to sell the land to the plaintiffs (appellants) for ₹20,00,000 through her Power of Attorney holder (Defendant No.2).  
  • ₹5,00,000 was paid as earnest money, and Defendants 1 & 2 agreed to evict unauthorized occupants.  
• Supplementary Agreement (1997):  
  • Since unauthorized occupants were not evicted, a supplementary agreement was executed, extending the sale deed execution timeline.  
  • Plaintiffs paid an additional ₹10,00,000, totaling ₹15,00,000 of the agreed amount.  
• Sale of Property to a Third Party (Defendant No.3):  
  • Despite the subsisting agreement with the plaintiffs, Defendant No.1 allegedly sold 40 out of 42 acres to Defendant No.3 for ₹40,00,000.  
  • Plaintiffs became aware when Defendant No.3 attempted to change revenue records.  
• Plaintiffs’ Legal Action (2003):  
  • Temporary Injunction granted (17th December 2003), restraining Defendants 1-3 from alienating or creating third-party rights.  
• Violation of Injunction & Further Sale:  
  • Defendant No.3, violating the court order, sold 10 acres (4+6 acres) to Respondents Nos.1 & 2.  
• Confirmation Deed by Defendant No.1:  
  • Defendant No.1 later executed a Confirmation Deed acknowledging the validity of the sale agreement with plaintiffs and admitting she was misled into selling to Defendant No.3.  
• Impleadment Application (2007):  
  • Respondents Nos.1 & 2 filed an application, seeking to be added as defendants.  
  • Trial Court rejected it (06th August 2014), ruling that they purchased the property in violation of the injunction and Section 52 of the Transfer of Property Act, 1882.   
  • No appeal was filed against this order, making it final.  
• Trial Court’s Final Judgment (2016):  
  • The suit was decreed in favor of the plaintiffs, directing execution of the Sale Deed within 2 months.  
  • Defendant No.3’s appeal was dismissed.  
• Delayed Appea l by Respondents Nos.1 & 2 (2018):  
  • Despite their impleadment being rejected and their vendor’s appeal being dismissed, they challenged the decree after 2 years.  
  • Application was filed seeking condonation of 586 days’ delay and leave to appeal.  
• High Court’s Decision:  
  • The High Court allowed both applications, condoning the inordinate delay and granting leave to appeal.  
  • This decision was opposed by plaintiffs. 

 What were the Court’s Observations? 

• The Supreme Court made the following observations: 
  • The bench summarized the principles governing the grant of leave to appeal as follows: 
    • Sections 96 and 100 of the Code of Civil Procedure, 1908 (CPC) respectively provide for preferring an appeal from an original decree or decree in appeal respectively. 
    • The said provisions do not enumerate the categories of persons who can file an appeal. 
    • However, it is a settled legal proposition that a stranger cannot be permitted to file an appeal in any proceedings unless he satisfies the court that he falls within the category of an aggrieved person. 
    • It is only where a judgment and decree prejudicially affect a person who is not a party to the proceedings, he can prefer an appeal with the leave of the court. 
    • A person aggrieved, to file an appeal, must be one whose right is affected by reason of the judgment and decree sought to be impugned. 
    • The expression “person aggrieved” does not include a person who suffers from a psychological or an imaginary injury. 
    • It would be improper to grant leave to appeal to every person who may in some remote or indirect way be prejudicially affected by a decree or judgment; and 
    • Ordinarily leave to appeal should be granted to persons who, though not parties to the proceedings, would be bound by the decree or judgment in that proceeding and who would be precluded from attacking its correctness in other proceedings. 
• The Supreme Court's judgment provided significant clarity on the rights of transferees pendente lite and the principles governing grant of leave to appeal to persons not party to the original proceedings. 

What is an Appeal?  

• Appeal is not specifically defined under CPC.   
• It is a judicial examination by the superior court of the order of the inferior court to test the correctness of the inferior court.  
• The person preferring an appeal is the appellant and the Court to which the appeal is preferred is the Appellate Court.  
• Anyone aggrieved by a decree or order of a court has the right to appeal to a higher court, provided such appeal is allowed against that decree or order.  
• In cases where an original jurisdiction court issues a decree, the first appeal typically lies with the appellate court authorized to hear appeals from decisions of that specific court.  
• Exceptions to this rule may exist if expressly provided by the CPC or any other applicable law.  
• Sections 96, 100,104 and 109 of CPC confer the right of appeal.  

Who Can Appeal?  

• Legal representatives of the original parties or the original parties themselves.  
• Legal guardian of the minor appointed by the court.  
• Any aggrieved person after taking leave of the court.  

Right to Appeal?  

• Appeal is both statutory and substantive right.  
• Appeal is a statutory right only when it is expressly given under the statute that an appeal can be preferred.  
• Appeal is a substantive right when it gives the party a right to appeal the higher court against the order passed by the subordinate court. 

What Are Sections 96 and 100 of the Code of Civil Procedure, 1908? 

• Section 96 of the CPC states the provisions regarding the appeal from the original decree.  
• It states that where otherwise expressly provided in the body of this Code or by any other law for the time being in force, an appeal shall lie from every decree passed by any Court exercising original jurisdiction to the Court authorized to hear appeals from the decisions of such Court.  
  • An appeal may lie from an original decree passed ex parte.  
  • No appeal shall arise from a decree passed by the Court with the consent of the parties.  
  • No appeal shall lie, except on a question of law, from a decree in any suit of the nature cognizable by Courts of Small Causes, when the amount or value of the subject-matter of the original suit does not exceed ten thousand rupees. 
• The provisions for second appeal is provided under Section 100 as: 
  • Section 100 - Second appeal — 
  • Subsection (1) states that save as otherwise expressly provided in the body of this Code or by any other law for the time being in force, an appeal shall lie to the High Court from every decree passed in appeal by any Court subordinate to the High Court, if the High Court is satisfied that the case involves a substantial question of law. 
  • Subsection (2) states that an appeal may lie under this section from an appellate decree passed ex parte. 
  • Subsection (3) states that in an appeal under this section, the memorandum of appeal shall precisely state the substantial question of law involved in the appeal. 
  • Subsection (4) states that where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. 
  • Subsection (5) states that the appeal shall be heard on the question so formulated and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question: Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law, not formulated by it, if it is satisfied that the case involves such question.