Full Judgment Text
Neutral Citation Number 2023/DHC/000160
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on : 05.12.2022
Pronounced on : 06.01.2023
+ CM(M) 1325/2022 & CM APPL. 51693/2022 (for stay)
MACHINE TOOLS AIDS INDIA ..... Petitioner
versus
M/s. GNC INFRA LLP & ANR. ..... Respondents
Advocates who appeared in this case:
For the Petitioner : Mr. Jay Savla, Senior Advocate with Ms.
Shilpi Chowdhary, Mr. R.C. Tiwari, Mr.
Yogesh Sharma and Mr. Vikrant
Choudhary, Advocates.
For the Respondents : Mr. Alok Bhachawat, Advocate with Ms.
Saloni Jagga, Advocate for R-1.
Mr. Mohit Arora, Advocate for R-2.
CORAM:
HON’BLE MR. JUSTICE TUSHAR RAO GEDELA
JUDGMENT
TUSHAR RAO GEDELA, J.
1. Petitioner impugns order dated 15.10.2022, passed by the Trial
Court in CS (Comm) - 350/2020 titled as M/s. GNC INFRA VS. M/s
Machine Tools Aids (India) & Anr., whereby, while allowing the
application under Order VIII Rule 10 of Civil Procedure Code, 1908
filed by the respondent/plaintiff, the Court had simultaneously
dismissed the application under Order VIII Rule 1 of the Code of
Civil Procedure, 1908 (hereinafter referred to as “CPC”) filed by
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 1
Neutral Citation Number 2023/DHC/000160
the Petitioner/ Defendant no.1, foreclosing the right of Petitioner to
file Written Statement.
BRIEF BACKGROUND OF THE CASE :
2. Shorn of unnecessary details on merits of the case, which is yet
to be adjudicated by the Trial Court, this Court, confines its
consideration only to the facts which led to the impugned order. The
relevant facts as culled out from Trial Court records are as follows:-
a.) A Commercial Suit, CS (Comm) 350/2020 titled as M/s GNC
INFRA VS. M/s Machine Tools Aids (India) & Anr., is laid by the
Respondent/Plaintiff seeking recovery of Rs. 1,48,73,337/- along
with future and pendente lite interest @ 24% p.a. on the said sum till
realization and other ancillary reliefs.
b.) Proceedings were instituted on 09.12.2020 on which date the
learned Presiding Officer was on leave and the matter was kept for
consideration. On 11.12.2020, the petitioner/defendant appeared in
person through video conferencing which were noted by the Court
Officer as the Presiding Officer was attending a Training
Programme. The matter then was posted to 21.12.2020 on which date
again the petitioner/defendant was represented through his son-in-
law. Since the Presiding Officer was on leave, matter was adjourned
to 04.01.2021.
c.) On 04.01.2021, proceedings were held vide Video
Conferencing mode and the Trial Court was pleased to pass an order
of 'status quo' in presence of petitioner/defendant.
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 2
Neutral Citation Number 2023/DHC/000160
d.) On 05.01.2022, counsel Sh. Amir Khan had appeared for the
petitioner/defendant. On 21.02.2022 and 07.05.2022, counsel Sh.
A.N. Khan had appeared. On 05.09.2022, the appearance of Sh. R.C.
Tiwari counsel for petitioner/defendant is noted on which date the
file was specifically taken up on an application of defendant no. 1
under the provisions of Order XXXIX Rule 4 r/w Section 151 CPC
and application u/o VIII Rule 1 of CPC, 1908.
e.) The petitioner/defendant continuously stated that the complete
copy of the plaint alongwith the annexures were never furnished to
him or his counsel. Counsel for the petitioner/defendant had
inspected the file on 22.08.2022, 25.08.2022 and 28.08.2022 and had
applied for the certified copies of the plaint and its annexures. The
same were received by the counsel for the petitioner/defendant on
08.09.2022.
f.) On 15.09.2022, counsel for the petitioner/defendant pointed
out that the suit is deficit in proper and correct court fee, upon which
the respondent/plaintiff undertook to make good the deficit fee
during the course of the day. At this stage again, petitioner/defendant
asked for directions for supply of plaint with documents which were
ordered to be supplied.
g.) That thereafter, vide Order dated 20.09.2022, the Learned Trial
Court had given five (5) days’ time to defendant to file reply to Order
VIII Rule 1 CPC, 1908 filed by the Plaintiff and also to file the
Written Statement subject to the orders to be passed on the
applications under Order VIII Rule 4 and also Order VIII Rule 10 of
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 3
Neutral Citation Number 2023/DHC/000160
CPC, 1908.
h.) In compliance, on 24.09.2022, the Petitioner/Defendant filed
their written statement alongwith statement of truth, affidavit of
admission/denial, list of documents, and replies to the application
under Order XXXVIII Rule 5, Order VIII Rule 10 of CPC, 1908 and
Section 12A of the Commercial Courts Act, 2015.
i.) In the meanwhile, on 27.09.2022 the applications under Order
XXXIX Rule 1 and 2 and Order XXXIX Rule 4 of the CPC, 1908
were disposed of in view of the oral statement of learned counsel for
petitioner/defendant that the petitioner has no objection to retention
of suit amount by NBCC and release of remaining amount withheld
as Bank guarantee.
j.) Thereafter, on 15.10.2022, the Trial Court had passed the
impugned order.
CONTENTIONS OF THE PARTIES:
3. Mr. Jay Savla, Learned Senior Counsel for the Petitioner
argued that the Trial Court has failed to consider that the Respondent
had filed a defective suit without court fees and without adopting
mandatory provision under section 12-A Commercial Courts Act and
was therefore, not a duly instituted suit. Separate applications for not
filing the court fees and exemption of Section 12-A of the
Commercial Courts Act, 2015 were moved by the respondent.
Though the Trial Court listed the matter for consideration, but till
date, the said applications have not been disposed of, implying that
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 4
Neutral Citation Number 2023/DHC/000160
the Trial Court has not applied its judicial mind to the suit. He
submits that therefore, the Trial Court neither issued any notice to the
petitioner nor ordered filing of any process. Thus, he submits that the
suit as laid by the respondent is not a properly instituted suit.
4. Learned Senior Counsel further submits that due to non-
furnishing of complete set of plaint and its annexures despite
requests, the petitioner was constrained to inspect the judicial file
through its counsel on 22.08.2022, 25.08.2022 and 28.08.2022
whereby it was revealed that the applications filed by the Respondent
have not been considered and order of issuance of the process has not
been issued by the trial court. Learned Senior Counsel submits that
the petitioner had filed three applications i.e., an application for early
hearing, application under Order XXXVIII Rule 4 and application
under Order VIII Rule 1 CPC, on 31.08.2022. Learned Senior
Counsel further submits that the trial court directed the respondent to
supply copy of the plaint on 15.09.2022.
5. Learned Senior Counsel further submits that the written
statement was directed to be filed within 5 days of the order dated
20.09.2022 and the same was filed on 24.09.2022.
6. Learned Senior Counsel submits that the Trial Court failed to
appreciate that admittedly, summons/notice were never issued to the
petitioner. Moreover, the petitioner had not admitted the claim of the
Respondent No.1 which is the basic requirement of proviso to Rule 1
of Order V, CPC, 1908. He submits that Trial Court failed to
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 5
Neutral Citation Number 2023/DHC/000160
appreciate that application under order VIII Rule 1 CPC, 1908 was
partly allowed and the Respondent was directed to supply the copy of
suit on 15.09.2022 whereafter the WS was filed within limitation
period.
7. Learned Senior Counsel for the Petitioner relies upon the
judgement titled as “Axis Bank Ltd. & Others vs. Mira Gehani &
Ors” reported as 2019 SCC OnLine Bom 358 decided on
27.02.2019 by Learned Single Judge of the High Court of
Maharashtra at Mumbai to submit that the service of summons was
held to be sacrosanct procedure and that the failure of such service
cannot be detrimental to the defendant.
8. Learned Senior Counsel also relies upon judgement rendered
by the Learned Division Bench of the High Court of Maharashtra at
Mumbai in the judgement titled as “Sunil Gupta vs. Asset
Reconstruction Company (India) Ltd. & Ors”, Writ Petition No.
4885 of 2022, cited as 2022 SCC OnLine Bom 2159 decided on
12.09.2022, to submit that the service of summons in commercial
suits is a mandatory procedure.
9. Per contra , learned counsel for the Respondent submits that
the suit was listed for the first time before the learned District Judge,
(Comm.) South-East District, Saket Court, on 09.12.2020, when the
learned Presiding officer was pleased to register the case which was
put up for consideration on 11.12.2020. Respondent informed the
petitioner herein about the next date of hearing i.e., 11.12.2020
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 6
Neutral Citation Number 2023/DHC/000160
through Gaurav Chopra, one of the partners of respondent no. 1 and
on his request, shared the procedure/link for a virtual appearance on
WhatsApp vide message dated 11.12.2020. On 11.12.2020, the
petitioner joined the proceedings through VC on 11.12.2020 and was
made aware of the next date of hearing i.e. 21.12.2020.
10. Learned counsel further submits that on 18.12.2020, the
respondent sent a scanned copy of the plaint along with complete
documents to the petitioner through email and also apprised him
about the next date of hearing i.e. 21.12.2020. Learned counsel
further submits that on 04.01.2021, petitioner appeared in person
through video conferencing and Trial Court passed an order directing
'status quo' in respect of payment and that none of this is denied by
the petitioner.
11. Learned counsel submits that when no written statement was
filed by the petitioner, on 07.08.2021, the respondent moved an
application under Order VIII Rule 10 r/w with section 151 CPC,
1908 seeking foreclosure of the right of the petitioner to file the
written statement and for pronouncing judgment.
12. Learned counsel emphatically submits that on many dates i.e.
05.01.2022, 21.02.2022 and 07.05.2022 the counsel for petitioner,
namely, Mr. Khan appeared but still chose not to file any written
statement. He further submits that Mr. Khan is defending the
petitioner in the proceedings initiated against the petitioner under
section 138 Negotiable Instruments Act, 1881, by the respondent.
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 7
Neutral Citation Number 2023/DHC/000160
13. Lastly, learned counsel submits that the petitioner is an
educated person, had knowledge of the case and entered appearance
in person as also through his counsel and therefore, is deemed to
have waived service through summons. He further submits that the
petitioner was duly represented by a counsel who knew the strict
timelines prescribed under the Commercial Courts Act, 2015 as well
as the amended provisions of the Code of Civil procedure, 1908.
Thus, learned Counsel submits that the plea of the petitioner that
since the summons were not served upon him, the time as prescribed
for filing written statement had not commenced, cannot be accepted.
14. Learned counsel for the Respondent relied upon the judgement
of the Hon’ble Supreme Court in Sunil Poddar and Ors. vs. Union
Bank of India decided on 08.01.2008, reported in (2008) 2 SCC 326 ,
to submit that the question was not whether the defendant was
actually served with the summons in accordance with the procedure
laid down and in the manner prescribed under Order V of the Code of
Civil Procedure, 1908 but whether the defendants had sufficient
notice of the date of hearing and had sufficient time to appear and
answer the claim of the plaintiffs. Learned counsel thus submits that
having appeared before the Trial Court, the Petitioner was precluded
from using false defenses.
15. Learned counsel for the Respondent also relied upon the
judgement passed by a Coordinate Bench of this Hon’ble Court in the
matter titled as “HT Media Limited & Ors. Vs. Brainlink
International, Inc. & Ors ., in CS(COMM.) 119/2020 reported in
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 8
Neutral Citation Number 2023/DHC/000160
2021 SCC OnLine Del 5398 , decided on 17.12.2021, to submit that
once the defendant appears, the service of summons are deemed to
have been waived and the timelines prescribed ought to be reckoned
from the date of first appearance. Learned counsel for the
Respondent also relies upon the judgement titled as “ SCG Contracts
(India) Private Limited Vs. K.S. Chamankar Infrastructure Private
Limited and Others” , reported in (2019) 12 SCC 210 , Civil Appeal
no. 1638 of 2019 rendered by the Supreme Court on 12.02.2019.
:
ANALYSIS AND CONCLUSION
16. This Court has heard the arguments addressed by the learned
Senior Counsel appearing for the petitioner as well as the learned
Counsel for the respondent and for the reasons mentioned hereunder,
the petition is allowed.
17. The facts and the basic contentions to decide the present lis
have already been enumerated above and are not being referred to
again.
18. In view of the facts obtaining in the present case and keeping
in view that the suit has been filed under the provisions of the
Commercial Courts Act 2015, it is necessary to examine the
provisions thereof as well as the amended provisions of the Code of
Civil Procedure, 1908.
19. As per the petitioner, it was never served notice of summons
for filing its written statement within 30 days period as stipulated in
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 9
Neutral Citation Number 2023/DHC/000160
Order VIII Rule 1 of the Code of Civil Procedure, 1908 as amended
by the Commercial Courts Act, 2015. As per the said provision, the
defendant is to file his written statement within period of 30 days.
However, for reasons to be recorded by the court and on payment of
costs, as the court deems fit, the defendant could be allowed to file
his written statement beyond the 30 days period but within 120 days
“from the date of service of summons.”
20. Order VIII Rule 1 CPC as amended and its proviso as
substituted is extracted hereunder:
" Written Statement : The defendant shall, within thirty days
from the date of service of summons on him, present a written
statement of his defence:
Provided that where the defendant fails to file the written
statement within the said period of thirty days, he shall be allowed to
file the same on such other day, as may be specified by the Court, for
reasons to be recorded in writing, but which shall not be later than
ninety days from the date of service of summons.
SPECIAL AMENDMENT
Commercial dispute of a Specified Value:- In its application
to any suit in respect of a commercial dispute of a Specified Value,
in Order VIII, in Rule 1, substitute the following proviso, namely:-
Provided that where the defendant fails to file the written
statement within the said period of thirty days, he shall be allowed to
file the Written Statement on such other day, as may be specified by
the Court, for reasons to be recorded in writing and on payment of
such costs as the Court deems fit, but which shall not be later than
one hundred twenty days from the date of service of summons and
on expiry of one hundred twenty days from the date of service of
summons, the defendant shall forfeit the right to file the written
statement and the Court shall not allow the written statement to be
taken on record".
(Emphasis supplied)
It is evident that the language employed in the proviso is
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 10
Neutral Citation Number 2023/DHC/000160
restrictive and circumscribe the right of the defendant to necessarily
file his written statement within 30 days. The proviso further curtails
and restricts the inherent power of the Court to grant extension of
time beyond 30 days, extendable upto 120 days from the date of
service of summons. The proviso simultaneously places a
responsibility upon the Court to record its reasons while granting
extension of time to defendant who may default in filing the written
statement within the stipulated period of 30 days.
21. Besides, the proviso is couched in a negative language and
stipulates that the right to file written statement beyond 120 days by
the defendant is automatically extinguished by operation of law.
22. Thus, there is no iota of doubt that Order VIII Rule 1 CPC read
with proviso as amended by virtue of the Commercial Courts Act,
2015 is prohibitive as well as restrictive in its nature in
contradistinction to Order VIII Rule 1 of the CPC, 1908 as applicable
to ordinary suits.
23. The wisdom of the legislature in drafting such a strict and
rigorous provision is not far to see, in that, commercial suits should
not be lingering in courts for years and ought to be resolved at the
earliest. This obviously would be in the commercial interest of the
nation.
24. Thus, it is clear that the leverage which hitherto before was
and is being enjoyed by the defendants in ordinary suits have been
taken away and the courts are divested of their powers of extending
time of filing a written statement beyond 30 days, except for reasons
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 11
Neutral Citation Number 2023/DHC/000160
to be rendered for extension of time, but not beyond 120 days from
the date of service of summons.
25. Learned Senior Counsel for the petitioner had vehemently
stressed on the provisions of Order V Rule 1 CPC and the proviso
thereto which was amended by the Commercial Courts Act, 2015 to
submit that the legislature deemed it necessary to amend the proviso
to Rule 1 of Order V, CPC to align the service of summons upon the
defendant with the proviso to Rule 1 of Order VIII CPC.
26. Order V Rule 1 CPC and the proviso thereto as amended is
extracted hereunder:-
"(1) Summons :- (1) When a suit has been duly instituted, a
summons may be issued to the defendant to appear and answer the
claim and to file the written statement of his defence, if any, within
thirty days from the date of service of summons on that defendant:
Provided that no such summons shall be issued when a defendant
has appeared at the presentation of plaint and admitted the
plaintiff's claim:
Provided further that where the defendant fails to file the written
statement within the said period of thirty days, he shall be allowed to
file the same on such other days as may be specified by the Court,
for reasons to be recorded in writing, but which shall not be later
than ninety days from the date of service of summons.
(2) A defendant to whom a summons has been issued under sub-rule
(1) may appear:
(a) in person, or
(b)by a pleader duly instructed and able to answer all
material questions relating to the suit, or
(c) by a pleader accompanied by some person able to answer
all such questions.
(3) Every such summons shall be signed by the Judge or such officer
as he appoints, and shall be sealed with the seal of the Court.
SPECIAL AMENDMENT
Commercial dispute of a specified value. – In its application to any
suit in respect of a commercial dispute of a Specified Value, in
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 12
Neutral Citation Number 2023/DHC/000160
Order V, in rule 1, in sub-rule (1), for the second Proviso,
substitute the following proviso, namely:–
Provided further that where the defendant fails to file the
written statement within the said period of thirty days, he shall be
allowed to file the written statement on such other day, as may be
specified by the Court, for reasons to be recorded in writing and on
payment of such costs as the Court deems fit, but which shall not be
later than one hundred twenty days from the date of service of
summons and on expiry of one hundred twenty days from the date
of service of summons , the defendant shall forfeit the right to file
the written statement and the Court shall not allow the written
statement to be taken on record."
(Emphasis supplied)
27. The plain reading of the proviso to Rule 1 Order V CPC brings
to fore the same aspect as was intended while substituting the proviso
to Rule 1 of Order VIII, CPC.
28. Rule 1 of Order V, CPC makes it clear that once a suit is
instituted, summons may be issued to the defendant to appear and
answer the claim and to file the written statement within 30 days
from the date of service of summons. However, under first proviso,
which is applicable to the ordinary suits, the defendant is permitted to
file written statement beyond the 30 days period but within the 90
days from the date of service of summons. It is trite that this proviso
has been held to be construed liberally and written statement even
beyond 90 days period has been directed to be taken on record, for
justifiable reasons. The said proposition is settled by the Supreme
Court in Kailash vs. Nanhku & Ors, reported in 2005 (4) SCC 480.
29. The second proviso to Rule 1 of Order V, CPC as amended
and made applicable to the commercial suits is restrictive in its nature
when compared to the first proviso as applicable to the ordinary suits.
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 13
Neutral Citation Number 2023/DHC/000160
30. Another provision which may be germane to the resolution of
the present dispute in the opinion of this Court would be Rule 5 of
Order V, CPC, 1908. The same is extracted hereunder:-
“ 5. Summons to be either to settle issues or for final disposal .– The
Court shall determine, at the time of issuing the summons, whether it
shall be for the settlement of issues only, or for the final disposal of
the suit; and the summons shall contain a direction accordingly:
Provided that, in every suit heard by a Court of Small Causes, the
summons shall be for the final disposal of the suit.”
It is manifest that Rule 5 requires the court issuing summons to
determine at the time of issuance of summons whether it shall be for
settlement of issues only, or for the final disposal of the suit and
directs that the summons shall contain a direction in accordance
thereto.
31. When the provisions of Rule 5 of Order V CPC are viewed in
conjunction with and as made applicable to commercial suits, it is
logical that the same shall be read and applied in the manner as
provided under second proviso to Rule 1 of Order V as well as
proviso to Rule 1 of Order VIII of the CPC, 1908.
32. When viewed in the aforesaid manner, it appears both logical
as also in consonance with the strict liability that is sought to be
brought upon a defendant in a commercial suit.
33. It is clear from the proviso to Rule 1 of Order V as well as
Rule 1 of Order VIII, that filing of the written statement by the
defendant within 30 days from the date of service of summons in
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 14
Neutral Citation Number 2023/DHC/000160
commercial suits is a strict and mandatory provision, extension
whereof would be subject only to the conditions specified therein. In
this view of the matter, it becomes relevant to consider as to from
which day, the 30 days period is to be reckoned, for the purpose of
filing written statement by the defendant.
34. There is no manner of doubt, as stipulated in proviso to Rule 1
of Order V and Rule 1 of Order VIII CPC, that the 30 days period
would commence on and from the date of service of summons
containing a stipulation that it is obligatory on the part of the
defendant to file his written statement, which would be a necessary
concomitant to construe if any default in filing the written statement
has occasioned.
35. This Court is, therefore, of the opinion that it is imperative to
direct the Civil Courts adjudicating commercial suits, while issuing
summons of the suit to the defendant, to necessarily incorporate the
endorsement that, “defendant should file his written statement of
defence within 30 days from the date of service/receipt of
summons” on the notice of summons. It is also apparent from a plain
and harmonious reading of all the aforesaid three provisions of the
CPC that service of summons itself is a very important procedural
step undertaken by the court and there cannot be any laxity insofar as
commercial suits are concerned.
36. Moreover, once this Court has concluded that, so far as
commercial suits are concerned, the failure in strictly following
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 15
Neutral Citation Number 2023/DHC/000160
procedural steps as stipulated in Order V Rule 1 and Rule 5 CPC,
1908 cannot be to the detriment of the defendant, the logical
conclusion would be that the same are mandatory in character.
CONSIDERATION OF THE JUDGEMENTS CITED:
37. Having examined the relevant provisions of the Code of Civil
Procedure, 1908 as applicable to present case, this Court proceeds to
examine the various judgements relied upon by the parties.
38. The judgements relied upon by the petitioner appear to be
applicable to the facts obtaining in the present case and which are
also fortified by the judgments rendered by Coordinate and Learned
Division Bench of this Court too. The same are as under:
a. Single Judge of High Court of Maharashtra at Mumbai
in the case of Axis Bank Ltd. & Others vs. Mira Gehani &
Ors (supra) has held as under:
“In view of the above, it is clarified that the period of
120 days will commence from the date of service of the Writ of
Summons and not the date a Defendant first enters appearance.
In other words, a party or its Advocate/s can no longer rely on
the above notification and avoid serving the writ of summons on
the Defendant/s. However, in order to ensure expeditious
disposal of Commercial Suits and in order to save time of this
Court as also the office of Ld. Prothonotary & Senior Master of
this Court, in the event a Defendant/its Advocate enters
appearance and by consent, agrees to waive service, the period
of 120 days will commence from the date of such waiver. In such
instance, there would be no requirement to serve the Writ of
Summons. This will prevent the loss of days involved in serving
the Writ of Summons and will expedite commencement of trial
and consequently, disposal of Commercial Suits.”
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 16
Neutral Citation Number 2023/DHC/000160
b. Learned Division Bench of High Court of Maharashtra
at Mumbai in Sunil Gupta vs. Asset Reconstruction Company
(India) Ltd. & Ors (supra), in Para 45, relied upon the
judgement rendered by another Division Bench of the same
High Court in Tardeo Properties Pvt. Ltd. v/s Bank of Baroda
reported in MANU/MH/1736/2007 whereby, in Para 25 & 26,
it was held as under:
“25.... In this view of the matter, there is no substance in the
argument that the matter relating to the service of writ of
summons pertains to the procedural law and that, therefore,
non-compliance or any irregularity in that regard would not
relate to the jurisdictional error. Failure to comply with the
mandatory requirement of the service of writ of summons to
enable the defendant to file the written statement cannot be said
to be a mere procedural irregularity. The provisions of law
essentially prescribe fetters on the power of the Court to
proceed with the matter against the defendant in the absence of
the service of writ of summons.
26. For the reasons stated above, in the absence of service of
writ of summons upon the defendants/ appellants, the learned
Single Judge could not have proceeded to dispose of the suit,
and certainly not under Order VIII of the CPC, and hence, the
impugned judgment cannot be sustained and is liable to be set
aside and the matter to be remanded, allowing the defendant to
file the written statement and the Court to proceed to dispose of
the suit thereafter in accordance with the provisions of law.”
(emphasis supplied)
c. The judgement by a Coordinate Bench of this Court in
Red Bull AG vs. Pepsico India Holdings Pvt. Ltd. and Ors. ,
reported in 2019 SCC OnLine Del 9901 rendered on
28.08.2019 held as under:
14. A perusal of the aforenoted statutory provisions
would show that when a suit is duly instituted summons may be
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 17
Neutral Citation Number 2023/DHC/000160
issued to the defendant to appear and answer the claim. Hence,
the court has to ensure that the suit has been duly instituted and
thereafter the court may issue summons on the defendant.
15. Mulla on CPC, 18th Edn. while interpreting Order 5
Rule 1 CPC states as follows:-
"Under this rule, it is obligatory to issue summons to defendant
unless the case falls within the proviso. When a party is sought
to be impleaded in a legal proceeding, service of notice on such
party cannot be a mere formality but should in fact be a reality."
16. In this background the Division Bench of this Court
in the case of Bright Enterprises Pvt. Ltd. & Anr. Vs. MJ
Bizcraft LLP & Anr. (supra) held as follows:-
"17. From the above and particularly
upon examining the provisions of Section 27 and
Order V Rule 1(1) CPC, it is evident that when a
suit is regarded as having been 'duly instituted', a
summons may be issued to the defendant. The use
of the expression 'duly instituted' has to be seen in
the context of the provisions of Orders VI and VII
of the CPC. In the present matter, it is nobody's
case that the suit had not been duly instituted in
the sense that it did not comply with the
requirements of Order VI and VII CPC. It is
neither a case of return of a plaint under Order
VII Rule 10 nor a case of rejection of a plaint
under Order VII Rule 11 CPC. The present case
is one of dismissal of the suit itself on merits.
Therefore, the only thing that needs to be
examined is whether the Court had a discretion to
issue or not to issue summons given that the suit
had been duly instituted. In our view, the use of
the word 'may' does not give discretion to the
Court and does not make it optional for it to issue
summons or not. This is further fortified by the
fact that the first proviso to Order V Rule 1(1)
itself gives a situation where summons must not
be issued and that happens when a defendant
appears at the presentation of the plaint and
admits the plaintiffs claim. Therefore, in such a
situation, there is no requirement for issuance of
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 18
Neutral Citation Number 2023/DHC/000160
summons and that is why the word 'may' has been
used in Order V Rule 1(1). In all other cases,
when a suit has been ‘duly instituted’ and is not
hit by either Order VII Rule 10 or Order VII Rule
11 CPC, summons has to be issued to the
defendant.
(emphasis added)
17. Hence, it is quite clear that once a suit is stated to
have been duly instituted and the suit is not hit by Order 7 Rule
10 or Order 7 Rule 11 CPC, the suit fulfils the stated
requirement. Summons have to then be issued to the defendant
thereafter.”
The judgements relied upon by the counsel for the
respondent are as under:
d. The judgement of the Supreme Court in Sunil Poddar
and Ors. vs. Union Bank of India (supra), relied upon by the
learned counsel for the respondent would not be applicable to
the facts of the present case inasmuch as the decision did not
deal with the amended provisions of the CPC as amended by
the Commercial Courts Act, 2015. That apart, in the present
case, neither any order to issue summons nor any summons
were at all issued by the Trial Court itself.
e. The judgement of Coordinate Bench of this Court in HT
Media Limited & Ors. vs. Brainlink International, Inc. &
Ors. (supra) , is distinguishable on facts. In that case, summons
were indeed issued by the Court by its order and the defendant
in that case had started appearing, though without filing his
written statement. Thus, the Coordinate Bench was of the
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 19
Neutral Citation Number 2023/DHC/000160
opinion that the appearance by defendant would amount to
waiver of service of the summons of the suit. However, in the
present case, the Trial Court itself was satisfied after
scrutinizing its record that no order to issue summons was at
all passed by the Trial Court nor was any summons issued.
39. Applying the aforesaid principle to the facts of the present
case, it is clear from the impugned order that the Trial Court itself
observed that the summons in the present case were never issued to
the defendant. Once the learned Trial Court concluded, upon the
perusal of its record, that summons under Rule 5 of Order V CPC,
1908 were never issued in accordance with the prescribed procedure,
the failure thereof cannot be detrimental to the rights provided to the
defendant.
40. It is trite that no person can be prejudiced for the mistake of
the court. The maxim “ Actus Curaie Neminem Gravabit” is way too
well settled by a catena of judgments of the Supreme Court. This
doctrine applies on all fours to the admitted facts in so far as the
mistake on the part of the Trial Court is concerned.
41. Thus, the impugned order is vitiated on two grounds in that,
firstly, Trial Court never passed orders issuing summons to the
petitioner and secondly, in the absence of issuance of valid summons,
it cannot be assumed that the petitioner had the knowledge of the
obligation to file the written statement within a period of 30 days
from the date of the service of summons. Logically, since no such
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 20
Neutral Citation Number 2023/DHC/000160
summons were ever issued, the question of not having filed the
Written Statement within 30 days period or the extended period of
120 days does not arise and the liability cannot be fastened upon the
petitioner.
42. In the facts of the present case and keeping in view the
aforesaid legal position, it is obvious that the failure to file written
statement within the stipulated period or even the extended period
cannot to be detrimental to the interest of the petitioner/defendant. It
is trite that procedures are handmaid of justice and the provisions are
to be construed accordingly.
43. It is a matter of record that the written statement was indeed
filed within five days from order dated 20.09.2022 passed by the
Trial Court.
44. Having regard to the entire facts as narrated above as well as
the examination of various provisions of Order V read with Order
VIII of the CPC 1908 as applicable to Commercial Suits, the
impugned order dated 15.10.2022 passed by the Trial Court is
unsustainable in law and is quashed and set aside.
45. In view of the maxim “ Actus Curaie Neminem Gravabit” too,
the impugned order is unsustainable in law.
46. As a sequiter, the written statement filed by the petitioner is
directed to be taken on record with the further directions to the Trial
Court to proceed in accordance with law and as per the provisions of
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 21
Neutral Citation Number 2023/DHC/000160
Code of Civil Procedure, 1908 as amended by the Commercial
Courts Act 2015.
47. The Registrar of this Court is directed to transmit copies of this
order to the learned District & Sessions Judge (HQ) as well as
District & Sessions Judge of all other districts in order to pass
necessary orders to make the endorsement as stipulated in Para 35 of
this judgment a mandatory part of the summons to be issued under
Order V Rule 5 CPC, 1908 in cases pertaining to Commercial Suits
as a necessary requirement.
48. The petition is disposed of, in above terms, with no orders as
to costs. Pending application also stands disposed of.
TUSHAR RAO GEDELA, J
JANUARY 06, 2023
Neelam/ nd
Signature Not Verified
Digitally Signed
By:VINOD KUMAR
Signing Date:10.01.2023
16:14:51
CM(M) 1325/2022 22