Delhi District Court
Satish Kumar Mishra vs M/S Woodcastle Spa & Resorts on 2 February, 2015
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IN THE COURT OF Ms. SUNENA SHARMA
Addl. Distt Judge - 04 (SE)
SAKET COURTS COMPLEX: NEW DELHI
RCA No.08/2015
Unique Case ID No.02406C0059452015
Date of Institution : 23.02.2015
Arguments concluded : 05.06.2015
Date of decision : 02.07.2015
Satish Kumar Mishra
S/o Sh. A. P. Mishra
R/o J3/17, 3rd Floor,
Opp. Alaknanda Market,
DDA Flat, Kalkaji, New Delhi .............. Appellant
Versus
M/s Woodcastle Spa & Resorts
(A Unit of Maa Girija Hotel & Resort)
Through its partner
Sh. Bhuvan Mittal,
S/o Sh. Sushil Kumar
Village Dhikuli, Ram Nagar,
Distt. Nainital (Uttakhand) .............. Respondents
J U D G M E N T
1. Instant regular civil appeal has been preferred by appellant against impugned order dated 23.01.2015 passed by learned Civil Judge02, (South)/Saket Courts in CS No. 607/14, whereby the suit filed by the appellant against the respondent was dismissed being not maintainable.
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2. The facts necessary as set out in the appeal and the impugned order are as follows:
i) Defendant is in the business of hospitality through their resort at Jim Corbett, Ram Nagar, Nainital. Plaintiff was appointed as Chief Operating Officer by the defendant in November, 2007. Plaintiff worked with defendant until March, 2011. In the month of April 2011, when plaintiff resigned from the defendant, there was an outstanding recovery of Rs. 95 lacs from different clients of the defendant relating to the employment tenure of plaintiff. Since, the job profile of plaintiff included business procurement for defendant and realisation of outstanding money of the business, the defendant mounted pressure upon plaintiff to ensure recovery of aforementioned outstanding dues.
ii) At the time of resignation, the plaintiff was entitled to Rs. 63,52,365/ on account of remuneration and commission from defendant but defendant assured to clear the dues of plaintiff only upon realisation of entire outstanding dues and further asked plaintiff to execute security cheques so as to ensure cooperation from plaintiff for recovery of dues from their clients.
iii) From March, 2011 till October, 2011, plaintiff was able to recover approximately Rs. 32 lacs from various parties and deposited the same in the account of defendant. In the month of October, 2011 and December, 2011, defendant obtained 16 cheques from the plaintiff with an assurance that they will not be misused and further promised to initiate recovery proceedings against defaulting parties. The cheques RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts Page 3 of 10 were taken as security from Delhi Office of plaintiff. Thereafter, defendant stopped interacting with plaintiff and also failed to take any steps for recovery of money from respective parties/clients for which security cheques were taken. Apprehending the malafide intentions of defendant, plaintiff issued directions to his banker for stop payment of aforementioned security cheques. Apprehension of plaintiff turned out to be correct as defendant presented six cheques for encashment in July, 2012 but on account of instruction given by plaintiff to its bankers, said cheques were returned dishonoured with remark 'stop payment'. Out of aforementioned six cheques, five were again presented on 03rd October, 2012 but same were dishonoured again. Later on, defendant presented the sixth cheque on 20th October, 2012 which also met the same fate and consequently, defendant issued legal notices to plaintiff for payment of said cheques and same were duly replied by plaintiff. Subsequently, defendant filed six complaint cases under Section 138 N.I. Act 1881, against plaintiff before District Court, Ram Nagar, Nainital in respect of dishonoured cheques bearing no. 138151, 138155, 37341, 37342, 138154, 688226 as mentioned in para 18 of the plaint wherein summons were issued against the plaintiff herein.
iv) In the meanwhile defendant also presented the remaining 8 cheques bearing no. 138156, 138170, 138157, 138158, 138159, 138164, 037343, 037344 as mentioned in para 20 of the plaint and the same were also got dishonoured with remarks 'stop payment' on 12.07.2012. Subsequently, plaintiff received a legal notice from defendant in regard to dishonour of said 8 cheques on 19.01.2013 and the same was duly RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts Page 4 of 10 replied by the plaintiff on 01.02.2013 wherein plaintiff also demanded back the 8 security cheques illegally misused by the defendant with an intention to cheat the plaintiff.
v) In aforementioned circumstances, plaintiff approached the Trial Court with a suit for permanent injunction for restraining defendants, its agents, employees, directors or any other authorized person on behalf of defendants from instituting the bogus case in respect of said 8 cheques as mentioned in para 20 of the plaint and further for seeking directions against the defendant to return said 8 cheques to the plaintiff.
vi) The suit was dismissed by the Trial Court as nonmaintainable on account of the fact that defendant i.e. the respondent herein has already filed complaint cases in respect of all the cheques in question and after filing of complaint case under Section 138 N.I. Act, defendant is not in possession of said cheques, which as on date form part of judicial record of said complaint cases and prayer for return of cheque as such has become infructuous.
3. Being aggrieved from the impugned order dated 23.01.2015 appellant preferred instant appeal mainly on the following grounds:
i) That the Ld. Civil Judge dismissed the suit as not maintainable without considering the fact that the cheques in question were never issued in discharge of any legal liability and hence, the order dismissing the suit at preliminary stage is totally arbitrary and illegal.
ii) That the proceedings under Section 138 N. I. Act are penal in nature RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts Page 5 of 10 and therefore, civil proceedings seeking remedy arising out of a contractual obligation is well permissible in law especially in view of the judgment of Hon'ble Supreme Court in P. Swarupa Rani Vs. M. Hari Naryan Alias Hari Babu 2008 (2) ACR 1661 S.
iii) That the core relief sought through the suit by the appellant was of permanent injunction to restrain the respondent from pressing any recovery from the appellant on the basis of the cheques in question which were never issued in lieu of any consideration and therefore, the said issue could have been easily adjudicated upon by the Court without the cheques being on record.
iv) That filing of the complaint case by the respondent under Section 138 N.I. Act is of no consequence for the adjudication of the core issue "Whether the cheques were issued in consideration or not?" and therefore, order of the Ld. Civil Judge dismissing the suit at the preliminary stage is erroneous and illegal.
v) That the approach of the Ld. Civil Judge in dismissing the suit without Trial at the preliminary stage is not appreciable and seems to be driven by injudiciousness and impulsiveness.
vi) That Ld. Civil Judge has gravely erred in dismissing the suit as not maintainable without any such objection regarding maintainability having been raised by the respondent in its WS or during course of argument.
vii) That even Ld. Civil Judge has not made any mention of any provision of law in the impugned order barring the suit of the appellant.
viii)That the impugned order has been passed naively and misguidedly as RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts Page 6 of 10 the Ld. Civil Judge has skipped vital implication of such judgment on rights and obligations of both the parties.
ix) That the respondent has strategised to press the bogus criminal case on the basis of the cheques which were never issued in discharge of any legal liability and therefore, the impugned order dismissing the suit of the plaintiff as nonmaintainable is liable to be set aside.
x) That the impugned order is an utter violation of the Code of Civil Procedure, Law of Contract, Specific Relief Act and above all against the spirit of principle of natural justice and hence, is liable to be set aside.
4. Upon service of notice of appeal respondent put his appearance through counsel. Ld. Counsel appearing for the respondent without filing any reply to the instant appeal, orally opposed the appeal.
5. Ld. Counsel for appellant has vehemently argued that there is no legal bar in pursuing a civil remedy arising out a contractual obligation, even during the pendency of criminal proceeding under Section 138 N. I. Act. Plaintiff in support of his argument relied upon judgment of Hon'ble Apex Court in Alka Gupta Vs. Narender Kumar Gupta (2010) 10 SCC 141, said judgment is also relied upon in support of the argument that a civil suit has to be decided after framing of issues and after affording parties an opportunity to lead evidence to prove their respective claims.
6. After going through the case file and the judgment relied upon, I am of the view that the aforementioned arguments put forth by the appellant's RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts Page 7 of 10 counsel are highly misplaced & misconceived. There is no denying to the legal preposition that suit for recovery based on cheque can simultaneously go along with a criminal complaint filed under Section 138 N.I. Act based on same cheque as both are separate remedies one based on penal provisions contained under Section 138 N.I. Act and other arising out of contractual obligation. But, position herein before this Court is entirely different as the appellant had approached Trial Court for relief of permanent and mandatory injunction for restraining the respondent herein from filing any cases against appellant on the basis of said 8 dishonoured cheques and for seeking directions against the respondent for return of said cheques. Admittedly, in respect of said cheques, respondent has already filed criminal complaint cases under Section 138 N.I. Act in Rampur, Nainital. Hence, in effect, the plaintiff/appellant, is actually seeking restraint against respondent from prosecuting the said criminal complaint cases wherein, the cheques in question have already been submitted in the concerned Court. The said eight dishonoured cheques are the foundation of said criminal cases instituted by respondent against appellant. Hence, in the garb of relief of permanent and mandatory injunction the relief claimed in the present suit is in substance for an injunction restraining respondent from prosecuting the criminal cases already instituted against appellant and, therefore, Section 41 (a)(b)&(d) of Specific Relief Act, 1963 would come into play and would stand on the way of the Court executing jurisdiction to grant injunction. Even going by the averments of the plaint both the reliefs are barred; the relief of permanent injunction under Section 41 Clause (d) of the Act and the relief of mandatory injunction under Section 41 Clause (a)&(b) of the Act.
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7. Even in Alka Gupta Vs. Narender Kumar Gupta (supra) relied upon by the appellant, it was held by the Hon'ble Supreme Court that : " A civil proceeding governed by the Code will have to be proceeded with and decided in accordance with law and the provisions of the Code, and not on the whims of the court. There are no shortcuts in the trial of suits, unless they are provided by law. A civil suit has to be decided after framing issues and trial permitting the parties to lead evidence on the issues, except in cases where the Code or any other law makes an exception or provides any exemption."
Here, an exception has been created under Order 7 Rule 11 Clause (d) of CPC, wherein Courts have been conferred with the powers to reject the plaint if the suit is found to be barred by any law. Although Trial Court has not mentioned said provision while dismissing the suit as non maintainable and appears to have missed out on said material aspect of the matter, but as already held above the appellant in the garb of mandatory injunction for return of cheques is actually seeking restraint order against defendant to prosecute its complaint cases filed under Section 138 N.I. Act on the basis of cheques in question which is clearly barred under Section 41 (a)
(b)&(d) of Specific Relief Act, 1963. As regard relief of permanent injunction, said relief has already become infructious as respondent has already filed criminal complaint cases under Section 138 N.I. Act on the basis of cheques in question. Even otherwise Section 41(d) of Specific Relief Act puts a clear cut bar for passing any injunction for restraining any person from instituting or prosecuting any proceedings in a criminal matter.
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8. It is also pertinent to note that although appellant has alleged that cheques in question were issued only as a security and not for discharge of any legal liability but he has not sought any such declaration in this regard and approached the Court merely for seeking the injunctions. Giving any such direction to respondent for return of said cheques will tantamount to restraining the respondent from prosecuting his complaint cases filed under Section 138 N.I. Act which is not permissible in view of bar of Section 41 Clause (a)(b) & (d) of Specific Relief Act. In this regard, I draw support from the judgment of Hon'ble Delhi High Court in Anuj Trading Co. Vs. Electrolux Kelvinator Ltd. 138 (2007) DLT 95 wherein in similar set of circumstances, the order of Trial Court rejecting the interim injunction application in view of bar of Section 41 (a)(b) & (d) of Specific Relief Act was upheld by the Hon'ble Delhi High Court.
In said case it was held as under by the Hon'ble Division bench : " The learned Single Judge held that reliefs claimed in the suit are in substance for an injunction restraining the defendant from prosecuting the criminal case instituted against the plaintiff and, therefore, Section 41 (b) of the Specific Relief Act would come into play and would stand on the way of the Court exercising jurisdiction to grant injunction. It was held that the injunction sought by the plaintiff cannot be granted since it would have the effect of preventing the defendant from prosecuting the criminal case against the plaintiff/appellant. Reference can also be made to another decision in Aristo Printers Pvt Ltd vs. Purbanchal Trade Centre, Guwahati reported in I (1992) BC 205. In the said case, the provisions of clause (a), (b) and (d) of Section 41 of the Specific Relief Act, 1963 came up for consideration. The Division Bench of the Guwahati High Court interpreted the RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts Page 10 of 10 aforementioned provisions and in that context it was held that the lower court in which the civil suit is pending and the criminal court in which the appellant may choose to file a criminal complaint are not in the same hierarchy of Court and that the criminal court is not subordinate to civil court and, therefore, clause (b), which bars an injunction being granted to restrain any person from instituting or prosecuting any proceeding in a court not subordinate to that from which the injunction is sought, would clearly apply to the facts of the case. It was also held in the said decision that since what is sought to be restrained in institution of any proceedings in criminal matter, the bar under clause (d) would be attracted."
9. Having regard to the aforementioned discussion, I do not find any merits in the appeal, same is accordingly dismissed.
10. Copy of judgment and decree sheet be sent to Trial Court.
Appeal file be consigned to Record Room.
(Sunena Sharma) Addl. Distt Judge04/SouthEast Saket Courts Complex, New Delhi Announced & dictated in the Open Court on 02.07.2015.
RCA No.08/2015 Satish Kumar Mishra v Woodcastle SPA & Resorts