Dismissed

Reliance Industries Limited v. NTPC Limited

Bombay HC20 Mar 2014APP/282/2014

Case brief

AI extract

What is this about?

In a suit for specific performance of a gas supply contract, the appellant sought discovery of internal memos and correspondence. The Division Bench held that the Single Judge's order dismissing the discovery application was not a final judgment, and dismissed the appeal. The court also rejected the claim for discovery based on the principles governing the Code of Civil Procedure.

What did the court decide?

Appeal summarily dismissed with no order as to costs.

Reliance Industries Limited Vs NTPC Limited — Contract and Commercial Disputes | Bombay HC (2014)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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APPEAL LODGING NO.151 OF 2014 IN CHAMBER SUMMONS NO.201 OF 2010 IN SUIT NO.95 OF 2005

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Reliance Industries Limited.

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vs.

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NTPC Limited.

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..Appellant. ...Respondent.

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Dr. Milind Sathe, Sr. Counsel, Mr. Firdosh Pooniwalla, Mr. Rishit Badiani, Ms. Reshma Ranadive i/by A. S. Dayal & Associates for the Petitioner.

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Mr. D.D.Madon, Sr. Counsel. Mr. V.R. Dhond, Sr. Counsel with Mr. S.V. Doijode, Ms. Reshma Mulla Feroze, Mr. R.H.Davlat and Mr. C.K.Sancheti i/by Doijode Associates for the Respondent.

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CORAM : MOHIT S. SHAH, C.J. AND M.S. SANKLECHA, J. DATE : 20 MARCH 2014

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PC:

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In this appeal under Clause 15 of the Letters Patent the order dated 20 February 2014 passed by the learned Single Judge of this Court in Chamber Summons No.201 of 2010 has been challenged. The Chamber Summons was taken out by the appellant defendant seeking an order against the plaintiff for discovery and inspection of documents as indicated and enumerated in Annexure to the chamber summons.

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The respondent-plaintiff has filed the above suit in December 2005 for specific performance of contract for supply of 132 trillion BTU of Natural Gas for a period of 17 years on the basis of certain documents executed in 2004. The appellant-defendant filed its written statement on 31 October 2007 contending that there was no concluded contract between the parties and parties were merely at the stage of negotiation. This according to the appellantdefendant was evident in view of meetings between officers of the appellant-defendant and respondent-plaintiff.

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Thereafter the respondent-plaintiff filed its affidavit of documents on 7 December 2007. The appellant-defendant filed its affidavit of documents in January 2008. The issues in the suit were settled on 6 October 2008. As the suit was expedited the respondentplaintiff filed its affidavit in lieu of examination-in-chief on 9 January 2009. The cross examination of the deponent of the affidavit is yet to be done.

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Thereafter, on 2 February 2010 the appellant-defendant through its Advocate sent a notice for discovery and production of documents to the respondent plaintiff. Immediately thereafter on 3 February 2010 the present chamber summons was taken out by the appellant-defendant seeking an order directing the respondentplaintiff to disclose on oath and give inspection of the documents mentioned in the schedule thereto as mentioned below :

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Notices/letters/E mails/Inter Office Memos sent by officials of NTPC among themselves regarding issues to be discussed with RIL during various meetings held between July 2004 and November 2005 in respect of the subject bid.

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Letters/E mails/inter office Memos sent by officials of NTPC to their management seeking instructions/clarifications with regard to issues to be discussed with RIL during the meetings.

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Notices/letters/E mails sent by officials of NTPC among themselves fixing the date and timing of internal meetings to discuss the issues with regard to finalization of GSPA.

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Agenda of such internal meetings.

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Notes/records of discussions and decision taken in internal meetings of officials of NTPC regarding issued with regard to finalization of GSPA.

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Letters/E mails of officials of NTPC recording the discussions, which had taken place in the meeting with RIL representatives from time to time with regard top finalization of GSPA.

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Presentation made by NTPC during their internal meetings.

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Presentations made by representatives of NTPC to the representations of RIL during various meetings held between July 2004 and November, 2005 particularly presentation made on 7^th October, 2005.

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Instructions to prepare the presentation made on 7^th October 2005.

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Notes/Records/Minutes prepared by officials of NTPC recording the points of discussions and decisions taken during the meeting with officials of RIL.

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Letters/E mails/Internal office Memos sent by officials of NTPC to their management seeking approval of the points discussed in the meeting with representative of RIL.

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Correspondence between NTPC and Government of India including Ministry of Power, Ministry of Petroleum and Natural Gas and Ministry of Fertilizer.

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Any other documents which are in power, possession and control of NTPC relating to matters in question in the suit.

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By the impugned order dated 20 February 2004 the learned Trial Judge dismissed the chamber summons on the following findings:-

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(a) Gross delay in filing this application for discovery in respect of the documents described in the Schedule to the Chamber Summons;

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(b) No sufficient and proper explanation to explain the delay particularly when the parties had filed their respective affidavits and documents earlier and the plaintiffs had already filed affidavit of their first witness in lieu of examination in chief as far as back on 9 January 2009.

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(c) Discovery was being sought in respect of the documents which are internal correspondence, notes, memos etc. of the respondent-plaintiff and which are not relevant to the disputes; and

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(d) The chamber summons has been filed under order 11 Rule 12 of the Code of Civil Procedure,1908 (CPC) and not under Order 11 Rule 14 of the CPC

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At the very outset, the learned Counsel for the respondent plaintiff has raised preliminary objection about the maintainability of this appeal. Reliance is placed upon the decision of the Supreme Court in Shah Babulal Khimji vs. Jayaben D. Kania and another 1981(4) SCC 8 in support of its submission that refusal to order production of documents is not a Judgment from which an appeal under Clause 15 of the Letters Patent is maintainable.

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Learned Counsel for the appellant-defendant has submitted that the appeal is maintainable as the refusal of the leaned Single Judge to order discovery and inspection prejudicially affects them and is a judgment as it finally determines the rights of the parties. In support, it is submitted that a Division Bench of this Court in its order dated 30 July 2009 (Appeal No.229 of 2005) in Chamber Summons No.218 of 2009 in Suit No.95 of 2006) has in an appeal arising in the present suit filed by the respondent-plaintiff held that an appeal allowing an amendment to the written statement is maintainable. Therefore, it is submitted that even this appeal is maintainable.

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On merits, the learned Counsel for the appellantdefendant submits that it is entitled to production of documents which are in the custody, control, power and possession of the plaintiff and which throw light on the controversy which is the subject matter of the suit. It is submitted that the learned Trial Judge has erroneously held that the documents are not relevant merely because the plaintiff has not relied upon the same. It is contended that by order dated 6 October 2008 the respondent plaintiff was ordered by this Court to disclose documents relevant to the proceedings. This the respondent plaintiff failed to disclose. Therefore, the appellant-defendant is entitled to call upon the plaintiff to place on record all the documents, internal correspondence, notes etc. relating to meetings of the plaintiff which are relevant for effective and complete adjudication of the dispute.

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As regards the delay in filing the chamber summons it is contended that under Order 11 Rule 14 of the CPC there is no question of any delay as the documents can be ordered to be produced at any time during the pendency of the proceedings. In any case, without prejudice to the above, it is submitted that after filing of the written statement on 31 October 2007 the defendant was granted leave to amend the written statement. However, the plaintiffs contested the issue in appeal and the plaintiff's appeal was dismissed by Division Bench of this Court on 30 July 2009 and Supreme Court also dismissed the Special Leave Petition on 7 October 2009. Hence, there was no delay in filing the chamber summons in February 2010.

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On the other hand, learned Counsel for the respondent plaintiff without prejudice to the preliminary objection about the maintainability of the appeal supports the order under appeal. The chamber summons has been field by the appellant-defendant under Order 11 Rule 12 of the CPC and its grievance is that respondentplaintiff had failed to disclose all documents in their possession as ordered by this Court on 6 October 2008.Therefore, they now seek disclosure of the documents by the respondent-plaintiff. It is submitted that the failure to submit documents directed by Court under Order 11 Rule 12 of CPC has consequences thereof provided under Order 11 Rule 21 of the CPC. It is thus not open to seek a fresh discovery. In any case, Order 11 Rule 14 of the CPC empowers the Court to call for any documents relevant to dispute from any of the parties to the dispute. It gives no power/right to a party to seek a direction from the Court that the documents be disclosed. It is further submitted that the internal correspondence between the officers of the respondent-plaintiff company and the noting or internal notes of its officers cannot be considered as relevant for the purpose of deciding the question whether there was a concluded contract between the parties. This is because, the said question has to be decided on the basis of the correspondence between the parties which has already come on record.

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Having heard the learned Counsel for the parties, we are inclined to uphold the preliminary objection raised by the learned counsel for the respondent plaintiff. The Supreme Court in Shah Babulal Khimji (supra) has laid down the tests when an order passed by a Single Judge would be regarded as a Judgment under Clause 15 of the Letters Patent as under:

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“113. … … There may also be interlocutory order which are not covered by Order 43 Rule 1 but which also possess the characteristics and trappings of finality in that, the orders may adversely affect a valuable right of the party or decide an important aspect of the trial in an ancillary proceeding. Before such an order can be a judgment the adverse effect on the party concerned must be direct and immediate rather than indirect or remote.

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In the course of the trial, the trial Judge may pass a number of orders whereby some of the various steps to be taken by the parties in prosecution of the suit may be of a routine nature while other orders may cause some inconvenience to one party or the other i.e. an order refusing an adjournment, an order refusing to summon an additional witness or documents, an order refusing to condone delay in filing documents after the first date of hearing, an order of costs to one of the parties, for its default or an order exercising discretion in respect of a procedural matter against one party or the other. Such orders are purely interlocutory and cannot constitute judgments because it will always be open to the aggrieved party to make a grievance of the order passed against the party concerned in the appeal against the final judgment passed by the trial Judge.

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Thus, in other words every interlocutory order cannot be regarded as a judgment but only those orders would be judgments which decide matters of moment or affect vital and valuable rights of the parties and which work serious injustice to the party concerned,. Similarly, orders passed by the trial Judge deciding question of admissibility or relevancy of a document also cannot be treated as judgments because the grievance on this score can be corrected by the appellate court in appeal against the final judgment.”

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Applying the aforesaid tests, it is clear that the learned Trial Judge has not finally decided any valuable rights of the parties. An order refusing to direct production of documents is a procedural matter and not a judgment. The grievance against the same can be corrected in an appeal against the final judgment passed by the trial Court. If the appeal were to be entertained from every procedural order of the trial Court then it would be well nigh impossible for the trial Court to proceed with the trial. If the final decision goes against the appellant-defendant in the suit, it would be entitled to raise all available contentions in its appeal.

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In view of the aforesaid principles laid down by the Apex Court, we have no hesitation in holding that the impugned order is not a judgment within the meaning of Clause 15 of the Letters Patent. As held by the Supreme Court in the course of the trial, a trial Judge may pass a number of orders some of which may be of a routine nature while other procedural orders may cause some inconvenience to one party or the other. Every interlocutory order cannot be regarded as a judgment but only those orders would be judgments which decide matters of moment or affect vital and valuable rights of the parties and which were serious injustice to the parties concerned. Hence. the orders passed by the trial Judge deciding question of admissibility or relevancy of a document also cannot ordinarily be treated as judgments.

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Even on merits we are not inclined to interfere with the impugned order of the learned trial Judge. Before us it was contended by the appellant-defendant that the chamber summons was taken out under Order 11 Rule 14 of the CPC. The power under the aforesaid provision is bestowed upon the Court to call for documents at any stage of a suit. It gives no right to a party under the aforesaid provision

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to insist that a particular document be ordered to be produced. So far as non disclosure of a document as required under Order 11 Rule 12 of the CPC is concerned the consequence is provided for in Order 11 Rule 21 of the CPC. It is not open to a party to keep making repetitive applications so as to frustrate the progress of the trial. The question whether there was a concluded contract between the parties will be determined on the basis of the documents which parties have already produced in the suit. Learned Trial Judge has held that principal issue in the suit will accordingly be decided on the basis of the documents already produced by the parties and the internal noting or correspondence between officers of the plaintiff company are not relevant.

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One more fact to be noticed is that the suit is pending since 2006. Written statement was filed by the appellant defendant in October 2007. The plaintiff had filed the affidavit of documents on 7 December 2007. The amendment to the written statement had prima facie nothing to do with the merits of the controversy of the suit as filed initially. The defendant knew in December 2007 which documents the plaintiff had not produced, of which discovery is now sought, as they pertained to the period July 2004 to November 2005. Therefore, the learned trial Judge is correct in taking a view that there was gross delay in filing an application for discovery. Reliance placed by the appellant-defendant upon the decision of the Apex Court in M. L. Sethi vs. R. P. Kapur 1972(2) SCC 427 is not apposite as it did not deal with an application under Order 11 Rule 14 of the CPC. Besides, the consequence of not complying with the order 11 Rule 12 of the CPC already passed in this case is provided for in Order 11 Rule 21 of the CPC Thus the trial Judge was right in holding that the above decision is

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completely distinguishable from the present facts.

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