• Decree [Sec-2(2)]- Order [Sec-2(14)] - Judgment [Sec-2(9)] - Mesne Profits [Sec-2(12)]
Means the formal expression of an adjudication which,
So far as regards the Court expressing it,
Conclusively determines the rights of the parties,
With regards to all or any of the matters in controversy in the suit,
And may be either preliminary or final.
It shall be deemed to include the rejection of a Plaint
And the determination of any question within sec-144, but
Shall not include –
(a) Any adjudication from which an appeal lies as an appeal from an order, or
(b) Any order for dismissal for default.
Explanation – A decree is preliminary when further proceedings have to be taken before the suit can be completely disposed of. It is final when such adjudications completely disposes of the suit. It may be partly preliminary and partly final.
The adjudications of a court may be divided into two classes: either Decree or Order. It means the adjudications, which are not decree, are orders and vice versa.
Adjudications: means judicial determinations of the matters in disputes. So, if a suit is dismissed for default of appearance of parties, or an appeal for want of prosecution etc. it cannot be considered as adjudication as court has not determined the matter in controversy judicially.
Court: is a place where justice is administered. To be a court, the person constituting it must have been entrusted with judicial functions. Hence, a decisions by an administrator on administrative nature cannot be considered as a decision by the court. Thus an order passed by an officer who is not a decree as observed in Deep Chand V. Land Acquisition Officer, AIR 1994 SC 1901.
Suit: The word suit is not defined anywhere in the code. However, Privy Council have defined it in Hansraj Gupta V. Official Liquidators of the Dehra Dun-Mussoorie Electric Tramways Co. Ltd. AIR 1933 PC 63
“ As per the definitions given in this case, the word ‘suit’ generally means and apart from some other context must be taken to mean, a civil proceeding instituted by the presentation of a Plaint”.
Thus, if a proceeding does not start by presenting a plaint, rather by other means; say by making an application or otherwise, then it cannot be considered as a suit and hence adjudication so done by the court will not be termed as a decree.
Now, if it so, the problem may be faced when any adjudication take place on any matter presented in front of the court by making an application, especially under the Indian Succession Act, the Hindu Marriage Act, the Land Acquisition Act, the arbitration Act, etc. And hence, the legislature to treat the adjudication of the court in the above mentioned act as decree has given the status of these adjudication as ‘Statutory Decree’.
Statutory Decree is not decree as per the definitions given under sec-2(2), as it does not come out of a suit, but it has been given status of decree by the statute, and hence it is known as statutory decree.
Thus, a rejection of an application for leave to sue in forma pauperis is not a decree, as there is no plaint till the application is granted.
Therefore, a proceeding which does not commence with a plaint and which is not treated as a suit under any other act (means statutory suit), cannot be said to be a suit under the Code and the decision given therein cannot be said to be a decree under sec-2(2) of the Code.
Thus, as observed in Diwan Bros. V. Central Bank of India, AIR 1976 SC 1503, a decision of a tribunal, even though described as ‘decree’ under the Act, is a decree passed by a tribunal and not by a court covered by Sec-2(2).
Rights of the Parties in Controversy:
Rights may be procedural or substantive, however for a decision to be called as a decree, the rights that is being determined must be substantive not merely procedural. Matters in controversy refers to the subject matters of the suit with reference to which some relief is sought. However, it should not be understood as relating solely to the merits of the case. It would cover any question relating to the character/status of the parties, jurisdiction, maintainability etc.
Conclusive determination: As far as the court which gives the decision, there should be conclusive determination of the matter in controversy, i.e., the determination must be final as regard the court which passes it. Thus, an interlocutory orders, which does not decides the rights of the parties finally is not a decree. Hence, an order refusing an adjournment, an order striking out defence, an order passed by the appellate court deciding some issues and remitting other issues to the trial court for determination, are not decrees as they don’t determine the rights of the parties conclusively.
It is not essential that decision given should conclusively determine all the matters in controversy. Even if any of the matter in controversy is conclusively determined by any decision, at least that decision with respect to that matter, may be termed as decree. The definition under sec-2(2) gives the scope of determination of all or any matters in controversy.
Preliminary and final decree: Decree may be either preliminary or final or sometimes partly preliminary and partly final. For any adjudication to be termed as decree the above mentioned conditions has to be satisfied, but in case when courts determines the right of the parties but does not finally dispose the matters completely, it is called preliminary decree. When the court completely dispose of the suit and finally settles all questions in controversy between the parties and nothing further remains to be decided thereafter, it is called final decree.
In, Shankar V. Chandrakant, AIR 1995 SC 1211, the Supreme Court stated:
“A preliminary decree is one which declares the rights and liabilities of the parties leaving the actual result to be worked out in further proceedings. Then, as a result of the further inquiries, conducted pursuant to the preliminary decree, the rights of the parties are fully determined and a decree is passed in accordance with such determination which is final. Both the decrees are in the same suit.
A final decree may be said to be final in two ways:
(I) when the time for appeal has expired without appeal being filed against the preliminary decree or the matter has been decided by the highest court;
(II) When, as regards to the court passing the decree, the same stands completely disposed of.
It is the latter sense that the word ‘decree’ is used in section 2(2) of the Code.”
So, when in a suit for possession, the court determines that the party have a right of mesne profit, but appoint a commission for inquiry to determine the appropriate amount that to be given as mesne profit and later on the basis of such report received finally decides the matter. In such situation, the first decision, which determines the right of mesne profit is the preliminary decree and the final decision wherein the amount is also mentioned is final decree.
Formal Expression: It means, there must be formal expression of adjudication, i.e. all the requirement of form must be complied with, and it must be deliberate and given in the manner provided by law.
How many Preliminary Decree and Final Decree may be in a Suit?
As the code is silent about the point, and hence the conflict in opinion was observed in the decisions of different High Courts. As in the case of Jyoti Prasad V. Ganeshi Lal , AIR 1961Punj 120, the high court opined that there can be only one preliminary decree in a suit, however in the case of Peary Mohan Mookerjee V. Manohar Mookerjee, AIR 1924 Cal 160, culcutta high court held there can be more than one preliminary decree.
The debate is concluded by the pronouncement of the Supreme Court in Phoolchand V. Gopal Lal ,AIR 1967 SC 1470, wherein it has been observed that there is nothing in the Code which prohibits passing of more than one preliminary decree, if circumstances justify the same and it may be necessary to do so.
However, this observation was restricted to the partition suit only as the court specifically mentioned.
In Gulusam Bivi V. Ahamadasa Rowther, AIR 1919 Mad 998, the High Court of Madras, referring to Rules 12 and 18 of Order 20 of the Code, stated:
“Neither rule contemplates more than one preliminary decree and one final decree in one suit. In fact, the code nowhere contemplates more than one final decree in one suit.”
Finally, in Shankar V. Chandrakant, AIR 1995 SC 1211, the Supreme Court Said “It is settled law that more than one final decree can be passed.”
Deemed Decree: As mentioned under sec-2(2) that the rejection of plaint and determination of any questions under section 144 of the code shall deemed to be a decree; however it shall not include the dismissal of suit in default and any adjudication from which an appeal lies as an appeal from an order.
As such the word deemed indicate it is not in actual but by statutory fiction for the purpose of extending meaning of the word decree which it does not expressly cover. So, a deemed decree is a decree because of this statutory fiction.
“Order” means the formal expression of any decision of a civil Court which is not a decree.
So, the adjudication of the court which is not a decree is an order. As a general rule, an order of a court is founded on the objective considerations and as such judicial order must contain a discussion of the question at issue and the reasons which prevailed the court which led to the passing of the order.
“Judgment” means the statement given by a judge of the grounds of a decree or order.
The essential element of a judgment is that there should be a statement for the grounds of decision.
As the Supreme Court in Balraj Taneja V. Sunil Madan, AIR 1999 SC 3381 held, a Judge cannot merely say “Suit Dismissed” or “Suit Decreed”. The whole process of reasoning has to be set out for deciding the case one way or the other.
So, Every Judgment other than that of a Court of Small Cause should contain
1. A concise statement of the case,
2. The points for determination,
3. The decision thereon, and
4. The reason for such decision.
A judgment of a Court of Small Cause may contain only point (2) and (3).
Mesne Profits: Sec-2(12)
“Mesne profits” of the property are those profits which the person in wrongful possession of such property actually received or might with ordinary diligence have received therefrom, together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possessions.”
So, Mesne Profits are the profit that the defendant had obtained from the wrongful possession of the property. It is not the profit that the plaintiff would have obtained rather it is the profits that defendant obtained during the period of wrongful possession of the suit property.
In case the defendant had not obtained any profits out of the suit property because of his carelessness, it never mean that court will not award any mesne profit to the plaintiff. The very word in the act ‘might by ordinary diligence have received’ indicate that court will allow the amount that courts find appropriate.
There is no straight jacket formula to calculate the amount that to be awarded to the plaintiff as the mesne profit but court will consider every case on individual basis.
Say for example, in case the defendant in the wrongful possession of a residential building, in that case the rent applicable in that area along with interest may form part of the amount decreed as mesne profit. Similarly, in case of a land, the general crops that usually grown by the farmer of that area taking that into consideration the amount will be determined.
So, it is immaterial whether defendants have actually availed benefits or not but what would have the general benefit that would have been obtained by ordinary diligence, will be awarded to the plaintiff.
Therefore, the test to ascertain mesne profit is not what the plaintiff has lost by being out of possession but what the defendant gained or might reasonably and with ordinary prudence have gained by such wrongful possession.