Dismissed

M/s. Sanco Cast Pvt. Ltd. v. N. Sambasiva Rao

Telangana HC13 Aug 2010CRP/4143/2008

Case brief

AI extract

What is this about?

The High Court dismissed a civil revision petition challenging a trial court's order allowing a defendant to file a belated counter claim via an additional written statement. The court held that despite the written statement being filed earlier, the claim was technically permissible as no evidence had been led, and correcting the omission would not cause prejudice.

What did the court decide?

No order as to costs.

M/s. Sanco Cast Pvt. Ltd. Vs N. Sambasiva… — Contract and Commercial Disputes | Telangana HC (2010)

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IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD

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FRIDAY, THE THIRTEENTH DAY OF AUGUST TWO THOUSAND AND TEN

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PRESENT

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THE HON'BLE SRI JUSTICE VILAS V. AFZULPURKAR

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CIVIL REVISION PETITION No.4143 of 2008

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Between:

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M/s. Sano Cast Pvt. Ltd.

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... PETITIONER

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AND

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N. Sambasiva Rao.

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...RESPONDENT

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Counsel for the Petitioner : MR. R. VINOD REDDY

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Counsel for the Respondent: MR. P. SUBASH

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The Court made the following: ORDER:

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This revision is by the plaintiff aggrieved by the order of the Court below dated 24.07.2008 allowing I.A.No.266 of 2008 filed by the defendant/respondent herein, permitting him to file counter claim in the suit.

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2. The brief facts are that the petitioner herein filed suit O.S.No.13 of 2003 against the respondent herein seeking a decree for recovery of Rs.17,00,165/- together with future interest at 18%. In the said suit, the respondent herein filed written statement and later after settlement of issues,

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the trial Court has examined P.Ws.1 and 2 and P.W.1 also has been crossexamined elaborately. While the suit was coming up for cross-examination of P.W.2, the respondent herein filed the present application I.A.No.266 of 2008 under Order 8 Rule 6-A read with Order 8 Rule 9 and Section 151 of the Code of Civil Procedure, 1908 seeking permission of the Court to file counter claim in the shape of additional written statement for recovery of Rs.17,83,507/- with interest. The said application was opposed by the plaintiff/petitioner by filing counter affidavit on various grounds and under the impugned order the Court below was of the opinion that since the counter claim has been filed before the evidence of defendant is closed there is no impediment for permitting counter claim and consequently, allowed the said application. Aggrieved thereby, the petitioner/plaintiff has moved this revision.

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3. Heard the learned counsel for either party.

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4. Learned counsel for the petitioner, primarily, contended that under Order 8 Rule 6-A CPC counter claim is permissible in respect of a cause of action accruing to the defendant before or after filing of the suit but such counter claim must be filed before the delivery of defence by the defendant or before time, as limited for delivering the defence, is expired. He states that the respondent had already filed a written statement as early as on 10.11.2003 and the petitioner also filed a rejoinder thereto on 29.03.2005. The suit, thereafter, was coming up for trial and while P.W.1’s evidence is completed only the cross-examination of P.W.2 remains. He also points out from the written statement that there is not even a hint of the present plea in the written statement already filed that is now sought to be raised in the proposed counter claim/additional written statement. The plea taken in the written statement by the respondent/defendant has been the basis for the cross-examination of P.W.1 and as such, after several years it is not permissible now to permit the defendant to file additional written statement by

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raising a counter claim. He also points out that the allegations made in the additional written statement/counter claim are against the counsel appearing for the defendant earlier and several other events, which were within the specific knowledge of the defendant even before he filed the original written statement. It is also alleged that the claim now sought to be made relates to the period long prior to the suit and it is apparent that a hopelessly time barred claim is sought to be put up as a counter claim by the proposed additional written statement. The said additional written statement/counter claim now sought to be filed dated 29.04.2008 is, therefore, clearly barred by time and even otherwise no ground exists to permit the said application of the respondent/defendant. He also submits that the present additional written statement contains statements contrary to the original written statement and amounts to an attempt to withdraw the admissions made by the defendant in the original written statement and even on this ground it is not permissible.

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5. Learned counsel for the respondent/defendant, on the contrary, fairly submits that the merits of the counter claim or it’s tenability is not in issue in the present proceedings and the only issue that requires consideration is whether such counter claim can be filed by the defendant by way of additional written statement under Order 8 Rule 6-A CPC. He also places reliance upon the words used under Rule 6-A CPC, which speaks of ‘before the defendant delivering his defence’,

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the counter claim can be filed. He submits that since the evidence on behalf of the defendant is neither led nor time for leading the evidence has expired there is no impediment for entertaining the counter claim.

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6. As before the Court below and in this revision also, both the learned counsel relied upon decisions of the Supreme Court and this Court in support of their respective case. The counsel for the petitioner relied upon RAMESH

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CHAND ARDAWATIYA v. ANIL PANJWAN I^[1] , which has considered the very same provision at length, and the aforesaid decision is referred and relied upon in several subsequent judgments treating it as the basic case dealing within interpretation of Order 8 Rule 6-A CPC. On facts, however, in that case the Supreme Court found that the additional written statement/counter claim sought to be filed by the defendant was malafide and was held not permissible and was found that the defendant in that case was seeking to reopen the proceedings including that part, which stood concluded against him by rejection of his earlier application under Order 9 Rule 7 CPC. Learned counsel also relied upon MAHENDRA KUMAR v. STATE OF M.P .^[2] for the proposition that counter claim also has to be treated as a suit and must be within the limitation provided for the said action.

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The said decision also was considered in RAMESH CHAND ARDAWATIYA’S case (1 supra). Then two decisions of this Court were also cited in SUGESAN & CO. PVT. LTD., MADRAS v. HINDUSTAN MACHINE TOOLS LTD .^[3] as well as N. ESHWRA PRASAD v. MARGADARSI CHIT FUND LIMITED, WARANGA L^[4] wherein also the decision in RAMESH CHAND ARDAWATIYA’S case (1 supra) was noticed and followed.

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7. Learned counsel for the respondent places reliance upon the decision in RAMESH CHAND ARDAWATIYA’S case (1 supra) to contend that the present additional written statement/counter claim fully satisfies the requirement of Rule 6-A CPC inasmuch as, admittedly, the defendant’s evidence has not been led nor the stage for leading evidence of the defendant has reached, as P.W.2 is still at the stage of cross-examination. He states that on 10.03.2008, P.W.1 was cross-examined and thereafter on 29.04.2008 this additional written statement is filed. He further states that the

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averments made in the additional written statement would show that the defendant had relied upon the then counsel and had not personally verified the aforesaid omission of not raising appropriate pleas and not raising counter claim, seeks to rectify the same by filing this additional written statement and on the grounds mentioned in the affidavit filed by the petitioner, the circumstances were properly explained. In any case, the learned counsel states that whether the counter claim now sought to be made is sustainable in law including the ground as to the bar under Limitation Act etc. are matters for the trial Court to consider at the appropriate stage and on that ground, the counter claim cannot be rejected at the threshold. He, therefore, supports the impugned order and submits that no interference is called for in this revision.

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8. The decision of the Supreme Court in RAMESH CHAND ARDAWATIYA’S case (1 supra) clearly lays down the legal position with regard to Order 8 Rule 6-A CPC including the purpose of the said provision to avoid multiplicity of judicial proceedings by permitting all disputes between the same parties to be decided in the course of the same proceedings. The basis for disallowing the counter claim as per the decision aforesaid was ‘if the consequence of permitting a counter claim either by way of an amendment or by way of subsequent pleadings would be prolonging of the trial, complicating otherwise smooth flow of the proceedings or causing a delay in the progress of the suit by forcing a retreat on the steps already taken by the Court, the Court will be justified in not exercising it’s discretion in favour of permitting the belated counter claim’. Thus, the counter claim was not to be permitted where it would amount to derailing the smooth flow of trial. So far as Rule 6-A CPC is concerned, it was held that ‘the Court has discretion to permit a written statement to be filed belatedly and therefore, has a discretion also to permit a written statement containing plea in the

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nature of set-off or counter claim to be filed belatedly but such discretion should be exercised in a reasonable manner, keeping in view, all the facts and circumstances of the case including the conduct of the defendant and the fact whether the belated leave of the Court would cause prejudice to the plaintiff or take away a vested right, which has accrued to the plaintiff by lapse of time. It would be seen from the present case that by applying the aforesaid decisions that; undoubtedly, the defendant has not led any evidence. The counter claim now proposed to be filed by way of additional written statement, therefore, is technically permissible under Rule 6-A CPC, though written statement was filed earlier.

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The subsequent pleadings in the nature of additional written statement under Order 8 Rule 9 CPC are permissible to be filed subject to the leave of the Court. The discretion of the Court for granting leave, therefore, has to be exercised by the Court in the light of the tests laid down above in the decision first cited. The Court below under the impugned order was satisfied that the discretion is required to be exercised in favour of the respondent/defendant. On the face of it, therefore, interference with the said discretion by this Court under revisional jurisdiction is not warranted.

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9. So far as the contention of the petitioner raising plea of limitation with respect to the counter claim is concerned, it has to be remembered that firstly, the question of limitation is a mixed question of fact and law and secondly, the decision on the aspect of limitation would amount to adjudicating on the merits of the counter claim, which is proposed to be filed. A decision of the Madras High Court in S. THIRUGNANASAMBANDAM v.

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KALIYAPERUMAL CHETTIAR^[5] would throw considerable light on this aspect that merits of the counter claim cannot be gone into at this stage. Interpreting Order 8 Rule 9 CPC, it was held that if satisfied the Court may permit such additional pleadings and grant leave but following the decision

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first cited it was held that the real question that falls for consideration is whether the additional pleadings can be allowed without causing injustice to other side.

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10. Even if the permission to file additional written statement/counter claim is disallowed as contended by the petitioner the respondent will have to file a fresh suit and the controversy between the parties, which is the subject matter of the present suit and which is proposed to be raised in the counter claim, will again have to be agitated by the parties in a separate suit. However, it is always open for the petitioner to contest the said counter claim by filing an appropriate rejoinder to the said claim and contest the claim on merits on all grounds available to him in accordance with law including the ground of limitation. No prejudice would be caused to the petitioner by permitting the respondent to file additional written statement with counter claim. The avoidance of multiplicity of the proceedings being the object of this Rule, the discretion exercised by the Court below in permitting the respondent to file additional written statement together with counter claim cannot be said to be perverse and interference with the same consequently is not warranted.

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The civil revision petition is accordingly dismissed. There shall be no order as to costs.

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_____________________ VILAS V. AFZULPURKAR, J

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August 13, 2010 DSK

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[1] (2003) 7 SCC 350 [2] (1987) 3 SCC 265 [3] 2004 (3) ALD 57 [4] 2004 (3) ALD 128

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[5] (2008) 2 MLJ 338

M/s. Sanco Cast Pvt. Ltd. v. N. Sambasiva Rao

Case brief

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M/s. Sanco Cast Pvt. Ltd. v. N. Sambasiva Rao

Case brief

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