Calcutta High Court
Indo Swiss Trading Company vs Ghatal Steam Navigation Company ... on 11 March, 1996
Equivalent citations: (1997)1CALLT233(HC)
Author: Tarun Chatterjee
Bench: Tarun Chatterjee
JUDGMENT Tarun Chatterjee, J.
1. In this revision petition, the petitioner challenges the validity of an order passed by the trial court granting leave under Order 2 Rule 2 of the Code of Civil Procedure to the plaintiff/opposite party to sue the petitioner separately for liquidated damages and for accounting in respect of its claim for re-imbursement arising out of breach of contract or acts of misfeasance or malfeasance on the part of the petitioner regarding the Ferry Service as prayed for in the circumstances to be presently indicated. The order has been questioned on the ground that the circumstances alleged in the application for leave did not justify the grant of leave. Let me elaborate this ground. According to the petitioner, since the whole claim in this suit includes declaration, permanent injunction and liquidated damages of 96,000 and that claim arises out of the same cause of action, the plaintiff has no right to sue separately for that claim of liquidated damages under the provision of Order 2 Rule 2 of the Code of Civil Procedure in as such as he has omitted to ask for relief in the same suit. This question relates to the exercise of the discretion which is vested by law in the trial court and except in very exceptional circumstances it is not proper for a revision court to interfere with the way in which the trial court has exercised its discretion. In the present case I do not see sufficient reason for interfering with that exercise of discretion. The relevant facts are as follows:
2. M/s Ghatal Steam Navigation Company, a public limited company incorporated under the Company's Act, 1956 (hereinafter referred to as 'the company') as plaintiff has brought this suit challenging the right of the petitioner to ply vessels or to interfere with the right of the company to ply vessels and carry on Ferry Service business between Bandhaghat and Ahiritolla across the river Hooghly and for permanent and temporary injunction for restraining the petitioner and its servants from playing any vessel and carrying on any Ferry Service between the said Bandhaghat and Ahiritolla. On being misled by the assurance of the petitioner the company paid to the petitioner a share of profits arising out of that Ferry service but the petitioner in violation of form of assurance failed and neglected to place in that Ferry service one vessel which it had withdrawn and on account of that the company had withdrawn reimbursement half of the share of profit. According to the petitioner, such reimbursement is a matter of accounting between the parties and besides the reimbursement the company has further liquidated claim of damages of Rs. 96,000 more for misfeasance and tortuous acts of defendant/petitioner. In the application for leave it has been alleged also that since the company has not included the said claim for reimbursement and liquidated damages in the present suit in order to oviate confusion and as the reliefs claimed in the shape of declaration and injunction for the sake of protection of the right of the company in respect of the ferry service in question constitute the subject matter of this suit which is quite different from the said claim for reimbursement and liquidated damages. The plaintiff may sue the defendant for such relief by bringing another suit. The application for leave under Order 2 Rule 2 of the Code of Civil Procedure was contested by the defendant/petitioner by filing a written objection whether it was alleged that the plaintiff having omitted to sue in respect of such claim it must be held that he intentionally had relinquished the said claim and as such was not entitled to sue afterwards for that claim. It was further alleged is the written objection that as the alleged claim for money of the company arise out of the same cause of action of this suit and the company having omitted to sue is respect of the said claim was debarred from sueing afterwards in respect of the said claim. The trial court after hearing the learned counsel for the parties and after going through the materials on record and the application and written objection filed in connection with the question of grant of leave under Order 2 Rule 2 of the Code of Civil Procedure asked for by the opposite party, has granted leave to the company to sue under Order 2 Rule 2 of the Code of Civil Procedure. While allowing the application for leave under Order 2 Rule 2 of the Code of Civil Procedure the trial court held that the claim for liquidated damages and accounting, for reimbursement cannot be said to be an integral part of the claim in the present suit which entirely relates to the right of ferry service in question and not to any monetary claim and therefore, non-inclusion of the claim for liquidated damages and of accounting in the present suit was not a case of relinquishment on the part of the claim in this suit within the meaning of Sub-rule 2 Rule 2 of order of the Code of Civil Procedure. The trial court further held in the impugned order that even if it was considered that the claim for liquidated damages and accounting had flown from the same cause of action yet the company may reserve its right to litigate the said claim in a separate proceeding with the leave of court by virtue of the provisions under Order 2 Rule 2(3) of the Code of Civil Procedure for the reason that in this suit the principle and fundamental reliefs relate to the right of ferry service in question and if these reliefs are granted, it would provide the basis for claiming such liquidated damages and accounting against the petitioner. The trial court has also held that the claim for liquidated damages and for accounting, even if arising out of breach of contract, is squarely covered under Clause (a) and (b) of Order 2 Rule 2 of the Code of Civil Procedure as they are passed on distinct and separate cause of action from the cause of action for establishment of the exclusive right over the ferry service in question for which reliefs have been sought for in the instant suit and accordingly, a separate suit for the said claim is quite maintainable in law and the same shall not be barred under Order 2 Rule 2 of the Code of Civil Procedure. Feeling aggrieved by this order the defendant-petitioner has come up to this court in revision.
3. On the facts stated above Mr. Dasgupta appearing on behalf of the defendant/petitioner has contended that on a proper construction of Clause 3 of Order 2 Rule 2 of the Code of Civil Procedure leave ought not to have been granted to the plaintiff/opposite party as the trial court ought to have held that the company having intentionally relinquished the portion of its claim in respect of the liquidated damages and accounting in that plaint itself which arose in respect of the same cause of action is not entitled afterwards to sue for any relief which has been omitted. In support of this contention, Mr. Dasgupta relied on two decisions of this court (Shrimati Bimal Kumari v. Ashok Mitra) and in 87 CWN 54 (Debabrata Tarafdar v. B.M. Pardhan).
4. After taking me through the plaint of this suit Mr. Dasgupta also contended that the trial court wrongly applied the provision of Order 2 Rule 4 of the Code of Civil Procedure by treating the present suit as a suit for recovery of possession, although the present suit is for declaration and injunction and for other incidental reliefs. According to Mr. Dasgupta Order 2 Rule 4 applies only to suit for recovery of immovable property and not to a suit of this nature which is evidently a suit for declaration and injunction in respect of a right to run a ferry service. It was next contended by Mr. Dasgupta that where an objection under Order 2 Rule 2 of the Code of Civil Procedure is taken, the omission to ask for a particular relief is not a defect but that goes to the maintainability of the very suit for which leave has been asked for as it only entails a disability as regards subsequent proceedings. In support of this contention, Mr. Dasgupta relied on a single bench decision of the Madras High Court repotted in AIR 1938 Madras page 979 (Idara Venkayya v. Idara Venkatarao). The contentions so raised by Mr. Dasgupta had been seriously contested by Mr. Roychowdhury, appearing on behalf of the plaintiff/opposite party. Mr. Roychowdhury, after taking me through some of the paragraphs of the plaint particularly paragraph 23 and paragraph 29 of the same argued that since the cause of action in respect of the claim of the liquidated damages and for accounting was a continuing cause of action, there was no bar to grant leave under Order 2 Rule 2 of the Code of Civil Procedure to the plaintiff-opposite party to sue separately in respect of the claim for liquidated damages and accounting. In support of this contention Mr. Roychowdhury relied on a Full Bench decision of the Punjab High Court (Sadhu Singh v. Pritam Singh) and submitted that in view of the fact alleged in the plaint that the claim for liquidated damages and accounting being a distinct and separate cause of action, it was rightly held by the trial court that the cause of action in respect of such claim for liquidated damages and accounting and the cause of action in filing the instant suit on termination of contract must be held to be distinct and separate cause of action and, therefore, a distinct and separate cause of action having been arisen, leave under Order 2 Rule 2 of the Code of Civil Procedure shall be granted. Apart from that, Mr. Roychowdhury contended that even assuming that the cause of action for the aforesaid two reliefs was the same even then under Order 2 Rule 2 Sub-rule 3 of the Code of Civil Procedure, the court still has the discretion to grant leave to the plaintiff to sue for the reliefs which has been omitted or relinquished in the suit.
5. According to Mr. Roy Chowdhury, since leave has been granted on consideration of materials on record and is based on sound principle of law, this court in revision shall not interfere with such a discretionary order passed by the trial court. Accordingly, Mr. Roychoudhury submitted that no interference is needed to be made in respect of the impugned order by this court which is exercising the discretionary power under Section 115 of the Code of Civil Procedure.
6. After giving my serious considerations to the submissions made on behalf of the parties as indicated hereinabove and after going through the impugned order and other materials on record I am of the view that i the submission of Mr. Roychoudhury has substance and accordingly the same must be accepted. Before I take into consideration the respective submissions of the learned counsel for the parties in detail, at this stage it is necessary to refer to the provisions relating to framing of the suit under Order 2 Rule 2 of the Code of Civil Procedure. Order 2 Rule 1 of the Code of Civil Procedure details with framing of suit. It says that every suit shall as far as practicable be framed so as to avert ground for final decision upon the subjects in disputes and to prevent further litigation concerning them. Therefore, from a perusal of Order 2 Rule 1 of the Code of Civil Procedure it is clear that the legislature by Order 2 prevents further litigation concerning the subjects in disputes between the parties. Order 2 Rule 2 of the Code of Civil Procedure provides that every suit shall include the plaintiff is entitled to make in respect of the cause of action but a plaintiff may relinquish any portion of this claim in order to bring the suit within the jurisdiction of any court. Order 2 Rule 2 Sub-rule 1 of Code of Civil Procedure is a general provision by which the legislature has intended that in every suit the whole claim that the plaintiff is entitled to make in respect of the cause of action must include the whole claim but right has been given to the plaintiff to relinquish any portion of his claim in order to bring the suit within the jurisdiction of any court. Order 2 Rule 2 (2) of the Code of Civil Procedure deals with relinquishment of a part of the claim by the plaintiff. It says that where a plaintiff omits to sue in respect of a portion of the claim intentionally or relinquishes any portion of his claim, he shall not afterward sue in respect of the portion so omitted or relinquished. Therefore Order 2 Rule 2 Sub-rule 2 of the Code of Civil Procedure makes it clear that a plaintiff who omits to sue in respect of the portion of his claim or intentionally relinquishes any portion of his claim in the earlier suit is debarred from filing another suit in respect of the said claim afterwards. But Order 2 Rule 2 Sub-rule 3 however, saves the plaintiffs, if in the previous suit he has taken leave of the court to sue for all such reliefs which have been omitted in the earlier suit or intentionally relinquished by the plaintiff. Therefore, on a plain reading of Order 2 Rule 2 Sub-rule 3 it is clear that it creates a discretion on the court to permit the plaintiff to sue for all such reliefs in respect of the same cause of action which has arisen in the earlier suit in a subsequently filed suit. Apart from that, on a plain reading of Order 2 Rule 2 of the Code and from the discussions made hereinabove it is clear that the bar of the suit under Order 2 Rule 2 of the Code of Civil Procedure may be raised in the following circumstances.
(1) Whether the cause of action in the previous suit is identical.
(2) Whether relief claimed in the subsequent suit could have been given, in the previous suit on the basis of the pleadings made in the plaint.
(3) Whether the plaintiff omitted to sue for a particular relief on the cause of action which has been disclaimed in the previous suit.
7. From the discussions made hereinabove it is thus clear that the plea of Order 2 Rule 2 can be applied to the cases where the plaintiff omits to pursue a portion of the cause of action on which the suit is based either by relinquishing the cause of action or by omitting a part of it but it cannot said that it has application in the cases where the plaintiff bases his suit on a separate and distinct cause of action. Let us, therefore, now consider whether the cause of action in respect of two reliefs indicated in the plaint as said hereinabove are same or the same are based on two distinct and separate causes of action. In my view, the trial court rightly held that the present suit challenging the right of the petitioner to ply vessels or not to interfere with the right of the opposite party to ply vessels and to carry on ferry service business between Bandhaghat and Ahiritolla across the river Hooghly and for permanent injunction and temporary injunction restraining the petitioner or his agent and servants from plying vessels and carrying on any ferry service between the Bandhaghat and Ahiritolla is based on termination of contract entered into between the parties. Therefore, the relief claimed in the present suit is based on a cause of action which is nothing but the termination of the agreement between the parties whereas cause of action for filing a suit in respect of claim for liquidated damages and accounting is distinct and separate. In (Sadhu Singh v. Pritam Singh) which dealt with the question whether a subsequent suit for accrued mesne profits is barred in view of the pendency of a suit for possession of immovable property as the cause of action for the subsequent suit for mesne profit and the cause of action of the earlier suit for possession of immovable property arose of the same cause of action. On appreciation of law on this point the Full Bench of the Punjab High Court held that two causes of action as aforesaid are distinct and separate causes of action and, therefore, the subsequent suit for mesne profit is maintainable in law and Order 2 Rule 2 of the Code of Civil Procedure shall not be a bar for filing a subsequent suit for recovery of mesne profit. In coming to such a conclusion, the Full Bench of the Punjab and Haryana High Court, relying on the celebrated decision of the acting Chief Justice Sulaman speaking for the special bench in the case of B. Ramkaran Singh v. Nakchand observed as follows:
"It seems to us that the cause of action for recovery of possession is not necessarily identical with the cause of action for recovery of mesne profits. The provisions of Order 2 Rule 4 indicate that the legislature thought it necessary to provide especially for Joining a claim for mesne profit with one for recovery of possession of immovable property and that but for such an express provision such a combination might well have been disallowed. A suit for possession can be brought within twelve years of the date when the original dispossession took place and the cause of action for recovery of possession accrued. The claim for mesne profit can only be brought in respect of profits within there years of institution of the suit and the date of the cause of action for mesne profits would in many cases be not identical with the original date of the cause of action for the recovery of possession."
8. Relying on the aforesaid observations of the acting Chief Justice Sulaman and also relying on other decisions referred to in said Judgment of the Full Bench, a conclusion was drawn by the Full Bench of Punjab and Hariyana High Court that the cause of action for recovery of mesne profit must be held to be separate and distinct from the cause of action for recovery of immovable property. I am in full agreement with the views expressed by Full Bench of the Punjab and Hariyana Court, that had followed the reasons given in other judgments of different High Courts of India which included AIR 42 Calcutta 40 (Srish Chand v. Jovar Danga Coal Concern Limited). Therefore, relying on the aforesaid Full Bench decision of the High Court, it must be held that the trial court was perfectly Justified in holding that the causes of action for filing the suit in the form of declaration and injunction the particulars of which have already been mentioned hereinabove and the cause of action for filing the suit for liquidated damages and accounting must be said to be a separate and distinct.
9. Let me now deal with the decisions cited by Mr. Das Gupta appearing on behalf of the petitioner. He relied on the decisions in the case of Bimal Kumari v. Ashok Mitra and in the case of Debabrata Tarafdar v. B.M. Pardhan 87 CWN 54. In my view, the aforesaid decisions, in the facts and circumstances of this case cannot be applied. In the case of Bimal Kumari v. Ashok Mitra Order 2 Rule 2 of the Code of Civil Procedure was found to be applied as the cause of action for possession on the basis of the agreement for sale was the same as the cause of action for filing a suit for specific performance of that agreement for sale. In view of my discussion made hereinabove, it cannot be said now that the cause of action for filing the instant suit and the cause of action for filing a suit for recovery of liquidated damages and for accounting be the same which is based on the Full Bench decision of the High Court of Punjab and Hariyana which is its turn based its finding following a decision of this court (Sris Chandra v. Joyramdanga Coal Concern) to which I am in full agreement. I am, therefore, unable to follow the single Bench decision of this court as referred to hereinabove. Apart from that, the learned single Judge also observed in the said decision that on the facts of the case. His Lordship was also not prepared to hold that the discretion of the court should be exercised in favour of the plaintiff in granting leave under Order 2 Rule 2 of the Code of Civil Procedure. In the said single Bench decision, it is only said that the cause of action for possession on termination of agreement was the same as the cause of action for filing a suit for specific performance for contract for sale.
10. Therefore, the learned judge held that on the same averments as those made in the plaint in that case, the plaintiff would be entitled to ask for possession also and the plaintiff having omitted to sue for the said relief for possession would not afterwards be entitled to sue for recovery of possession as the cause of action for both the reliefs was the same. In that decision, it was therefore, held that the second suit was barred Order 2 Rule 2 of the Code of Civil Procedure as the plaintiff had omitted to sue in respect of the relief for recovery of possession or intentionally relinquished a portion of his claim in the first suit, the plaintiff can not afterwards sue in respect of the said part so omitted or relinquished. Even assuming that this decision of the single bench decision of this court is still holding the field it may be said here that in that decision the second suit was found to be barred under Order 2 Rule 2 of the Code of Civil Procedure as the plaintiff omitted to sue in respect of the relief for recovery of possession in the earlier suit So far as this case is concerned, the company having made certain averments in respect of claim for liquidated damages and accounting, categorically applied for leave under Order 2 Rule 2 to sue on the cause of action for the relief of liquidated damages and accounting. There is another aspect for which no reliance can be placed in the aforesaid two decisions of this court so far as the present case is concerned. It has been rightly pointed out by the trial court that the maintainability of the claim for liquidated damages and for accounting in respect of the claim of the plaintiff for reimbursement arising out of breach of contract relating to ferry service as indicated in the plaint is totally dependent upon the determination of the dispute between the parties regarding the right to run ferry service in question as the claim for liquidated damages and for accounting for reimbursement as alleged by the plaintiff-company cannot be said to be an integral part of the claim in the present suit which clearly relates to the right of ferry service in question and not to any monetary claim. Therefore, the trial court rightly held that non inclusion of the claim for liquidated damages and for accounting in this suit is not a case of relinquishment of a part of the claim in this suit within the meaning of Order 2 Rule 2 of the Code of Civil Procedure. Therefore, even if it is considered that the said claim for liquidated damages and accounting arises from the same cause of action yet the plaintiff may reserve his right to litigate that claim in a separate suit with the leave of the court by virtue of Order 2 Rule 2(3) of the Code of Civil Procedure for the obvious reasons that the reliefs claimed in the present suit are the principle and fundamental reliefs categorically relating to the right of the ferry service in question and these reliefs if granted in this suit may provide the basis for claiming the liquidated damages and accounting for claim for reimbursement. For the reasons aforesaid, I am in agreement with the trial court that it can also safely be held that in view of Order 2 Rule 2 Sub-rule 3 of the Code, the plaintiff can subsequently file another suit for some of the reliefs which were not asked for in the earlier suit by obtaining leave from the court. The other decision that is now to be dealt with relied on by Mr. Dasgupta is a single beach decision of the Madras High Court reported in AIR 1938 Madras 979 (Venkayya v. Venkata Rao). In my view, the said decision has no manner of application to the facts and circumstances of this case. In that reported decision of the Madras High Court, the question that was really decided was as to when leave under Order 2 Rule 2 Sub-rule 3 of the Code can be resisted and what consideration for grant of such leave should be taken into consideration by the court before granting such relief or to refuse to grant leave to sue separately.
11. Therefore, in my view, the said decision dealt with as to when leave under Order 2 Rule 2 of the Code of Civil Procedure should be obtained. Is it before the institution of the suit or not? Therefore, this decision is not an appropriate one for deciding the question as raised in this case. Before parting with this judgment one more aspect of the matter should be considered. It is not disputed by the learned counsel for both the parties that in order to grant or refuse leave under Order 2 Rule 2 of the Code of Civil Procedure the court shall exercise its discretion in the matter. But it is well settled that such discretion must be based on sound principle of law. Reference is made in this connection in the case of Ramji Dayawals v. Invest Import in in which it has been laid down when and how such discretion.
12. Can be used and when the Appellate court can or ought to interfere with order of the trial court passed in its discretion. In paragraph 20 at page 2095 of the said decision, the Supreme Court observed as follows:
"The important question is whether the court was justified in the facts and circumstances of the case in exercising its discretion in favour of the respondent. Before examining this aspect, a minor contention raised by Mr. Majumder that when the motion is addressed to the discretion of the court and the court has exercised its discretion one way, the appellate court should be slow to interfere with the discretionary order and substitute its own discretion in place of the discretion of the court before which the motion was addressed and as in this case both the learned single Judge and appellate Bench have exercised the discretion in favour of the respondent, in exercise of its extraordinary Jurisdiction this court should not interfere with the same, may be disposed of. It is well settled that where the trial court has a discretion in the matter, the appellate court would not ordinarily substitute its discretion in place of the discretion exercised by the trial court. But it is equally well settled that where the trial court ignoring the relevant evidence, side tracking the approach to be adopted in the matter and overlooking various relevant considerations, has exercised its discretion one way, appellate court keeping in view the fundamental principle can and ought to interfere because when it is said that a matter is within the discretion of the court it is to be exercised according to well established judicial principle according to the reason and fair play, and not according to whim and caprice, 'Discretion', said Lord Mansfield in R. v. Wilkes, (1770) 98 ER 327 when applied to a court of justice, means sound discretion guided by law. It must be governed by rule, by humour, it must not be arbitrary, vague, and fanciful but legal and regular (see Craies on Statute Law, 6th Edn. p 273). In the course of this Judgment we would be constrained to point out that both the learned single Judge and the judges of the Division Bench completely overlooked the well established principles in granting stay of suit in a case where reliance is placed upon a subsisting arbitration agreement."
13. Nobody can dispute about the proposition of law enunciated by the Supreme Court in the aforesaid decision as to when a discretion used by the trial court can be interfered with by the appellate court. This question shall not arise in this case as, in my view, the trial court, while exercising its discretion by granting leave under Order 2 Rule 2 of the Code of Civil Procedure, has considered every pros and cons of the matter and based its discretion on sound principle of law and, therefore, the question of reversing such a discretionary order in the exercise of my discretionary power in revision cannot arise at all. As Supreme Court observed in the aforesaid decision that the court in exercising discretion would be slow to interfere with the discretionary order of the trial court and substitute its own discretion in place of the discretion of the court before which the application under Order 2 Rule 2 of the Code was moved and in view of the fact that in this case the trial court has rightly exercised its discretion in favour of the plaintiff/opposite party, I am not permitted in revision to exercise my discretion in favour of the defendant/petitioner by interfering with the discretionary order of the trial court as, I am of the opinion that the trial court, while exercising its discretion in favour of the plaintiff/opposite party has not ignored any relevant evidence or any materials on record nor it can be said that its approach to the problem as illegal and irregular or the court had overlooked various relevant considerations. As stated herein above, the discretion used by the trial court is based on sound principle of law and it had taken into consideration of the relevant materials on record and thereafter it had exercised its discretion in favour of the plaintiff/company which, in my view, in the exercise of my discretionary power cannot be upset nor I can substitute another discretion in favour of the petitioner.
14. Before parting with this order, I may even mention at this stage that I shall be failing in my duties if I do not consider the decision reported in 87 CWN. 54 (D. Tarafdar v. B.M. Prodhan) cited by Mr. Dasgupta on behalf of the petitioners. It is difficult to appreciate how this decision was cited for the purpose of resolving the problem at hand. The question that was decided in that decision inter alia, was whether the relief of possession which was not asked for could be given to the plaintiff in a suit for specific performance of the contract for sale. In that decision, it was held that the relief of possession being inherent in a relief for specific performance of a contract of sale, such a relief need not necessarily be prayed for separately and a court executing a decree for specific performance of such a contract can grant possession. From the aforesaid, it is evidently clearly that the question that arises in the present case was not at all an issue in the aforesaid decision. In this case, I am only concerned whether leave under Order 2 Rule 2(3) of the Code of Civil Procedure could be granted by the court or not in the facts and circumstances of this case and in view of the reliefs claimed in the suit. Accordingly, I am unable to follow the aforesaid decision of the Division Bench in this case.
15. For the reasons aforesaid, I do not find any reason to interfere with the order impugned in this revisional application and accordingly, the revisional application is rejected There will be no order as to costs.