1. With the consent of parties, present petition is taken up for disposal today.

2. Petitioner challenges the order dated 02.12.2020 whereby the First Appellate Court heard the arguments on the application under Order 41 Rule 27 of the Code of Civil Procedure, 1908 (CPC) and dismissed the same.

3. Mr. Bhalla, learned Senior Counsel appearing for the Petitioner submits that the first Appellate Court while hearing the arguments overlooked the law laid down by the Supreme Court in M/s. Eastern Equipment & Sales Ltd. Vs. Ing. Yash Kumar Khanna, (2008) 12 SCC 739, [LQ/SC/2008/1042] which was also considered by a Co-ordinate Bench of this Court in Savitri Devi vs. Gayatri Devi and Ors., 2010 (114) DRJ 327. This Court in Savitri Devi (supra) followed the dicta as laid down in the judgment of the Supreme Court in M/s. Eastern Equipment & Sales Ltd. (supra) regarding the manner and stage at which the Appellate Court ought to consider an application under Order 41 Rule 27 CPC.

4. Mr. Bhalla, learned Senior Counsel submits that the impugned order appears to have been passed in the teeth of the judgments referred to above and submits that being contrary to law, the impugned order ought to be set aside.

5. Per contra, Mr. Vachher, learned counsel for the Respondent draws the attention of this Court to paras 13, 16 and 19 of the judgment rendered by this Court in Savitri Devi (supra) to submit that once having adjudicated the application under Order 41 Rule 27 CPC, the only recourse left would be to challenge the same alongwith the final order to be passed by the Appellate Court in the next higher forum and not by way of a petition under Article 227 of the Constitution of India.

6. Mr. Vachher further submits that having undertaken this exercise contrary to the observations made in para 13, 16 and 19, the present petition ought to be dismissed being not maintainable.

7. In rebuttal, Mr. Bhalla, learned Senior Counsel draws the attention of the Court to para 21 of the judgment in Savitri Devi (supra) to submit that despite observations made therein, finally the Co-ordinate Bench directed that the applications under Order 41 Rule 27 CPC, which were dismissed prior to hearing of the appeals itself, be remanded back for a fresh consideration.

8. Having heard learned counsel for the parties and having perused the record, this Court finds it relevant to quote para 21 of the judgment rendered by the Co-ordinate Bench of this court in Savitri Devi (supra) :-

“21. The Supreme Court in Eastern Equipment & Sales Ltd. ordered setting aside of the orders of the appellate court under Order 41 Rule 27 CPC made prior to the hearing of the appeal and directed the hearing of the applications afresh along with the hearing of the appeal. Following the same, it is directed that in spite of dismissal of all the aforesaid petitions, the orders on applications under Order 41 Rule 27 of the CPC made prior to the hearing of the appeal in all the aforesaid cases are set aside and the applications ordered to be considered afresh along with the hearing of the appeal."

9. The other relevant judgment rendered by the Supreme Court is in the case of Union of India vs. Ibrahim Uddin and Ors., (2012) 8 SCC 148, [LQ/SC/2012/578] observations made in paras 49 and 52 thereof, are extracted hereunder :-

“49. An application under Order 41 Rule 27 CPC is to be considered at the time of hearing of appeal on merits so as to find out whether the documents and/or the evidence sought to be adduced have any relevance/bearing on the issues involved. The admissibility of additional evidence does not depend upon the relevancy to the issue on hand, or on the fact, whether the applicant had an opportunity for adducing such evidence at an earlier stage or not, but it depends upon whether or not the appellate court requires the evidence sought to be adduced to enable it to pronounce judgment or for any other substantial cause. The true test, therefore is, whether the appellate court is able to pronounce judgment on the materials before it without taking into consideration the additional evidence sought to be adduced. Such occasion would arise only if on examining the evidence as it stands the court comes to the conclusion that some inherent lacuna or defect becomes apparent to the court. (Vide Arjan Singh v. Kartar Singh [1951 SCC 178 : AIR 1951 SC 193 [LQ/SC/1951/15] ] and Natha Singh v. Financial Commr., Taxation [(1976) 3 SCC 28 [LQ/SC/1976/90] : AIR 1976 SC 1053 [LQ/SC/1976/90] ] .)

52. Thus, from the above, it is crystal clear that an application for taking additional evidence on record at an appellate stage, even if filed during the pendency of the appeal, is to be heard at the time of the final hearing of the appeal at a stage when after appreciating the evidence on record, the court reaches the conclusion that additional evidence was required to be taken on record in order to pronounce the judgment or for any other substantial cause. In case, the application for taking additional evidence on record has been considered and allowed prior to the hearing of the appeal, the order being a product of total and complete non-application of mind, as to whether such evidence is required to be taken on record to pronounce the judgment or not, remains inconsequential/inexecutable and is liable to be ignored.”

10. The relevant paragraph of the judgment rendered by the Supreme Court in M/s. Easern Equipment & Sales Ltd. (supra), which is para 5, is also extracted hereunder :-

“5. We have heard learned counsel for the parties and after considering the facts and circumstances of the present case, we are of the view that in order to decide the pending appeal in which the application under Order 41 Rule 27 of the Code of Civil Procedure was filed ought to have been taken by the appellate court along with the application for acceptance of additional evidence under Order 41 Rule 27 of the Code of Civil Procedure.”

11. In the overall conspectus of the facts arising in the present case as well as after considering the law laid down in the aforesaid judgments, this Court is of the considered opinion that the impugned order is unsustainable in law and ought to be set aside in view of the fact that the law as laid down was ignored by the learned Fist Appellate Court while considering the application under Order 41 Rule 27 CPC.

12. The contention as raised by Mr. Vachher, learned counsel for the Respondent is not sustainable in law for the aforesaid reason also.

13. The correct procedure which the first Appellate court ought to have followed was to defer the hearing of application under Order 41 Rule 27 CPC to the day when it would be hearing final arguments of the appeal itself.

14. Having regard to the fact that the First Appellate Court took up the application under Order 41 Rule 27 CPC itself, before hearing the appeal, the impugned order is rendered unsustainable in law making it susceptible to being set aside.

15. In view of the aforesaid, impugned order dated 02.12.2020 passed by the First Appellate Court is set aside and the matter remanded back to it to consider the merits of the application under Order 41 Rule 27 CPC at the stage of final hearing of the appeal.

16. The contentions of the both parties are kept alive and reserved and may be raised at the time of final hearing of the appeal.

17. In view of the aforesaid, the petition along with the applications filed herewith stand disposed of, with no orders as to costs.

18. The compilation of judgments handed over by Mr. Bhalla, learned Senior Counsel is taken on record.