Case: M/S. Surajmull Nagarmull Vs. State Of West Bengal

1. Messrs. Soorajmull Nagarmull - who will hereinafter be referred to as the appellants - were tenants of three warehouses and vacant land appurtenant thereto- popularly known as the Shamnagar Jute Godowns-belonging to Sri Hanuman Seva Trust. The warehouses were used for storage of jute belonging to the appellants. By an order dated August 17, 1943, and issued under R. 75A of the Defence of India Rules, 1939, the warehouses were requisitioned and possession thereof was taken on September 21,1943. As the amount of compensation payable to the owner of warehouses could not be fixed by agreement an Arbitrator, was appointed under S.19(1)(b) of the Defence of India Act, 1939. Before the Arbitrator, Sri Hanuman Seva Trust claimed compensation as owners of the warehouses. The appellants claimed compensation for loss of earnings, "damages to business" and cost of removal of 18,000 maunds of jute and some iron implements, which the appellants claimed had to be removed in consequence of the order of requisition. The appellants estimated the compensation at Rs. one lakh. The Arbitrator by his order dated December 13, 1947, observed that the appellants had failed to prove any actual loss of business in consequence of the requisition, and rejected the claim of the appellants.2. Against the order passed by the Arbitrator an appeal was preferred to the High Court of Judicature at Calcutta. The appellants valued the claim at Rs. 1,50,000/-. At the hearing of the appeal, the State of West Bengal contended that the appeal was not maintainable in view of the provisions of S. 19(1)(f) and (g) and S. 19(3)(c) of the Defence of India Act and the 2nd Proviso to R. 19 framed under the Defence of India Act. The High Court upheld the contention raised by the State of West Bengal and dismissed the appeal. With special leave the appellants have appealed to this Court.

Court's reasoning:
In our judgment, there is no force in that contention. An appeal is a creature of statute. The Arbitrator not being a court subordinate to the High Court, an appeal would lie only if it is expressly so provided. The Legislature has provided that where the amount of compensation awarded does not exceed Rs. 5,000/- no appeal shall lie against the award. The rule does not contemplate that the bar to the maintainability of the appeal will be effective only if some amount is awarded but the compensation so awarded is less than Rs. 5,000/-. If the Arbitrator rejects the claim and refuses to award anything the case would, in our judgment, fall within the 2nd proviso to R. 19 as being one where the amount of compensation awarded does not exceed Rs. 5,000/-.5. The second proviso to R.19 enacts a rule of which a parallel is difficult to find. The right to appeal does not depend upon the claim made by the claimant either before the acquiring authority or the Arbitrator or before the High Court it depends solely upon the amount of compensation awarded by the Arbitrator. But however, unusual the rule may appear to be, it would not be open to the Court to extend the right to appeal and to enable a claimant whose claim has been rejected completely to appeal to the High Court. The right to appeal is exercisable only if the amount awarded exceeds Rs. 5,000/-.