SUPERINTENDING ENGINEER AND ORS. versus B. SUBBA REDDY

Citation: [1999] 2 S.C.R. 880 · Decided: 26-04-1999 · Supreme Court of India · Bench: D.P. WADHWA · Disposal: Appeal(s) allowed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
SUPERINTENDING ENGINEER AND ORS. 
v. 
B. SUBBA REDDY 
/ 
APRIL 26, 1999 
[D.P. WADHWA AND N. SANTOSH HEGDE, JJ.] 
Civil Procedure Code, 1908-0rder 41 Rule 22-Arbitration Act, 
1940-Sections 41 and 39-Filing of cross-objections in second ap,peal-
lnterest granted in form of damages for period prior to reference-Further 
C interest at 18% p.a. awarded on total amount of award, Earnest Money 
Deposit and damages-Trial Court made award rule of Court and reduced 
interest awarded from 18% p.a. to 12% p.a.-No appeal filed by respondent-
contractor-Appellant filed appeal in High Court in which respondent filed 
cross objections challenging order of trial court-High Court dismissed the 
D appeal but allowed the cross-objections-On appeal Held, cross-objection is 
an appeal-Right to file cross-objection is only substantial not procedural 
in nature but right to file cross-objection under Section 41 is procedural as 
Section 39 provides that CPC would apply-If there is no right of cross-
objection under Section 39 it cannot be read into Section 41-Cross-objection 
filed before· High Court was not maintainable and interference in decree of 
E trial court was unwarranted-Award granting damages by way of interest for 
the period phor to reference set aside-Interest can be awarded for a period 
prior to reference only if there is an agreement to that effect or it is allowable 
under the Interest Act, 1978. 
Appellants and the respondent had entered into four agreements which 
F were the subject matter of dispute. The arbitration in a series of four awards, 
in addition to the claims of the respondent, awarded damages towards delay 
in payment of claims which was calculated at the rate of 15% per annum. 
Respondent was further awarded interest at the rate of 18% per annum on 
the total amount of the award, Earnest Money Deposit, Bank Guarantee and 
G the said damages from the date of reference till payment, whichever is 
earlier. All the awards were made rule of court by order of the Principal 
Subordinate Judge reducing the interest awarded to 12% from 18%. The 
respondent-contractor did not appeal against this. However, the appellant 
filed· an appeal before the High Court under Section 39 of the Arbitration-
Act, 1940. The respondent then filed cross-objections under Order 41 Rule 
H 22 CPC challenging the order of the Principal Subordinate Judge. High 
880 
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SUPERINTENDING ENGR. v. B. SUBBA REDDY 
881 
Court dismissed the appeal but allowed the cross-objections restoring the A 
arbitrator's order awarding 18% interest per annum. Hence this appeal. 
The appellants contended before this court that cross-objections were 
not maintainable under Section 41 of the Act, and that arbitrator could not 
award interest for the period prior to reference. 
The respondent contended before this court that since provisions of 
CPC are applicable to the appeal filed under Section 39 of the Act, cross 
objections are also maintainable. 
Allowing the appeal, this Court 
HELD : 1. Appeal is a substantive right and is a creation of statute. 
Right to appeal does not exist unless it is specifically conferred. Cross-
Objection is like an appeal having all trappings of an appeal. It is filed in 
the form of memorandum and the provisions of Ord!r 41 Rule 1 CPC, so far 
B 
c 
as these relate to the form and contents of the memorandum of appeal apply D 
to cross-objection as well. Court fee is payable on cross-objection like that 
on the memorandum of appeal. Provisions relating to appeal by an indigent 
person also apply to cross-objection. Even where the appeal is withdrawn or 
is dismissed for default, cross-objection may nevertheless be heard and 
determined. The respondent even though has not appealed may support the 
decree on any other ground but if he wants to modify it he has to file cross- E 
objection to decree which objections he could have taken earlier by filing an 
appeal. Cross-objection is nothing but an appeal. [893-C) 
Sadhu Ganjaram Bhagade v. Special Dy. Collector, [1970] J SCC 685; 
Alopi Nath v. Collector, Varanasi, (1986) Supp. SCC 693; HM Kamaluddin F 
Ansari & Co. v. Union of India, [1983) 4 SCC 417; Hakam Singh v. Gammon 
(India) Ltd, (1971) 1 SCC 286; N. Jayaram Reddy v. Revenue Divisional 
Officer and Land Acquisition Officer, [1979) 3 SCC 578; R. Mc Dill & Co.(P) 
Ltd. v. Gouri Shankar Sarda, [1991) 2 SCC 548; Ramanbhai Ashabhai Patel 
v. Dabhi Ajit Kumar Fulsinji, (1965) 1 SCR 712 and Bhanu Kumar Shastri 
v. Mohan 

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