High Court Erred: Withdrawal of Appeals Should End Proceedings. Third Parties' Limited Rights Emphasized

The Supreme Court held that the High Court erred in proceeding with the hearing of appeals despite the appellants' withdrawal. The Court emphasized that once withdrawal was permitted, proceedings should have ended. It clarified that third parties could only continue appeals in specific circumstances, which were absent here. The High Court's decision was deemed incorrect, and the appeals were allowed, setting aside the High Court's order and dismissing the appeals, thereby terminating the proceedings. The judgment underscored the importance of respecting higher court decisions and allowing third parties to address grievances independently.

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Issues:
1. Termination of proceedings in appeals despite withdrawal by appellants.
2. Rights of third parties in appeal proceedings.
3. Validity of High Court's decision to proceed with the hearing despite withdrawal.

Issue 1: Termination of proceedings in appeals despite withdrawal by appellants
The Supreme Court considered an appeal where the High Court of Gujarat refused to terminate proceedings in two first appeals despite the appellants seeking to withdraw them. The case originated from a Scheme decree concerning a temple governed by the Bombay Public Trusts Act, 1950. The City Civil Court had passed a final decree framing a Scheme for the temple's administration and management of its properties. The appellants later filed applications to withdraw the appeals unconditionally, which were initially dismissed by the High Court.

Issue 2: Rights of third parties in appeal proceedings
The High Court justified its decision to proceed with the hearing of the appeals on the grounds that the rights of third parties were involved. However, the Supreme Court disagreed with this view. It emphasized that once the Supreme Court had permitted the withdrawal of the appeals, the High Court should not have continued with the proceedings. The Court explained that third parties could only continue appeals in specific circumstances, such as when cross-objections were present or transposition occurred, which was not the case here.

Issue 3: Validity of High Court's decision to proceed with the hearing despite withdrawal
The Supreme Court held that the High Court's decision to proceed with the hearing despite the withdrawal of the appeals was incorrect. The Court highlighted that the appellants had given an undertaking not to seek modification of the Scheme decree, but this undertaking did not bind third parties. Therefore, the rights of third-party intervenors were not extinguished, and they could pursue their grievances independently. Ultimately, the Supreme Court allowed the appeals, set aside the High Court's order, and declared the appeals as dismissed, thereby terminating the proceedings before the High Court.

In conclusion, the Supreme Court clarified the legal position regarding the termination of appeal proceedings upon withdrawal by the appellants and the rights of third parties in such situations. The judgment emphasized the importance of upholding the decisions of higher courts and ensuring that third parties have the opportunity to address their grievances independently.

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