Andhra HC (Pre-Telangana)
Srikanth Spinners Rep. By Its ... vs State Bank Of India, Rep. By Its Branch ... on 15 June, 1995
Equivalent citations: 1995(2)ALT746
ORDER B.K. Somasekhara, J.
1. There is no representation on behalf of the respondent. Therefore, the learned Advocate for the petitioner has been heard and the matter is being disposed of on merits.
2. The petitioner seeks review of the judgment of this Court in C.R.PNo.786 of 1993 dated 1-7-1994 reported in Srikanth Spinners represented by its Proprietor K.Rajesham Kalakal v. State Bank of India, Toopran Branch, Gajwel Taluk, .
3. The grounds on which the review is sought are:-
(i) That the learned Advocate for the petitioner could not be present when the matter was taken up for consideration due to illness, to place all the relevant grounds to dispose of the matter;
(ii) that the decisions of the Supreme Court in Mahendra Kumar and Anr. v. State Bank ofMadhya Pradesh and Ors., , and of Orissa High Court in Mangulu Pirai v. Prafulla Kumar Singh and Ors., . and the provisions of Order 8 Rule 8 of Civil Procedure Code were not considered by the Court and if so considered, would have led to different results;
(iii) that the Court has relied upon the precedent of Orissa High Court in Kashi Biswanath Dev. v. Paramananda Routrai, AIR 1980 Orissa 260., which was overruled by a Division Bench of the same High Court in Mangulu Pirai v. Prufulla Kumar Singh and Ors., .; and
(iv) there are errors which are apparent on the face of the record which warrant powers of this Court to review its own judgment.
4. The said case was disposed of by this Court with a definite record of the absence of the learned advocate for the petitioner in that case more than once and after hearing the learned Advocate for the respondent and on merits. The question before the Court was the correctness and the legality of the orders passed by the learned Subordinate Judge, Siddipet in O.S.No. 44/89 in I.A. No. 412/92 dismissing the petition on the ground that the present petitioner, who was the defendant in the suit, was not entitled to setup counter-claim after filing written statement by virtue of Order 8 Rule 6-A of C.P.C but in fact, in the said I.A. amendment of the written statement was claimed under Order 6 Rule 17 C.P.C. This Court, relying upon Order 8 Rule 6-A and Order 6 Rule 17 C.P.C. and the two pronouncements in Kashi Biswanath Dev. v. Paramananda Routrai (4 supra) and Bank of Baroda v. Gurcharan Singh, ., came to the conclusion and laid down the law that in a suit filed for recovery of money counter-claim cannot be set up after filing written statement particularly in the guise of amending the written statement. In support of such a view, the dicta laid down in Dega Films v. M/s Lotus Productions, . Vishwanath Lohia v. Allahabad Bank, . Bhaskar Chandra Behera v. Ranital Rice Mill, . Bansidhar Mahanty v. United Bank of India, , and TKVS Vidyapoornachary v. M.R. Krishnachari, , was relied upon. While agreeing with such law laid down in such proceedings, this Court stated as follows:
"This Court respectfully agrees with such a legal principle laid down therein and reiterate that counter-claim cannot be set up by a defendant after filing the written statement and particularly in the guise of amending the written statement. The simple implication of such a provision appears to be that there must be expeditious disposal of all the controversies between the parties arising out of the same transaction and leading from the same cause of action. That the plaintiff should not be taken by surprise by the defendant and the defendant should think of setting up counter claim in answer to the plaintiffs claim of recovery of money as part and parcel of the same transaction leading to the same cause of action."
Based on that, the dismissal of the application for amendment by the learned Subordinate Judge was supported.
5. Mr.Anjaneyulu, the learned advocate for the petitioner has contended that in view of the clear law laid down Mahetidra Kumar and Anr. v. State Bank of Madhya Pradesh and Ors. (2 supra) by the Supreme Court and Mangulu Pirai v. Prafulla Kumar Singh and Ors. (3 supra) by Orissa High Court overruling Kashi Biswanath Dev. v. Paramanada Routrai (4 supra), upon which reliance is placed by this Court in the order which is under review, there is apparent error on the face of the record in regard to the correct law operating upon the facts and circumstances of the case and that it requires reivew and re-declaration of the law in correct terms.
6. In so far the reliance of this Court on the pronouncement of the Orissa High Court in Kashi Biswanath Dev. v. Paramananda Routrai (4 supra) which was over- ruled by the same High Court in Mangulu Pirai v. Prafulla Kumar Singh and Ors. (3 supra) in support of such a view, technically it may be said that there is an error which is patent on the face of the record. The only important question to be considered is whether the Supreme Court in Mahendra Kumar and Anr. v. State Bank of Madhya Pradesh and Ors. (2 supra) the Supreme Court has laid down law which is different from what is laid down by this Court as above. While dealing with the provisions of Order 8 Rule 8 C.P.C. and specifically regarding the question whether a counter-claim can be permitted or allowed to be set up after filing written statement, the Supreme Court has stated as follows:-
"The next point that remains to be considered is whether Rule 6A (1) of Order VIII, Civil P.C. bars the filing of counter-claim after filing of a written statement. This point need not detain us long, for Rule 6-A (1)does not, on the face of it, bar the filing of counter-claim by the defendant after he had filed the written statement. What is laid down under Rule 6A(1) is that a counter-claim can be filed, provided the cause of action had accrued to the defendant before the defendant had delivered his defence or before the time limited for delivering his defence has expired."
It is made clear from these expressions that although there is no bar in the provision for the defendant to file the counter-claim after filing the written statement, it is subject to the rider that the cause of action for such a counterclaim should accrue before filing the written statement and that such a counterclaim is not barred by limitation. If we understand such expression as above on the principle laid down by this Court in the case supra, there cannot be any difference and particularly if we read the entire interpretation as a whole, that may mean the same thing. But still since no reference was made to such a decision of the Supreme Court and since Mr. Anjaneyulu, the learned Advocate thinks that having due regard to the difference in the expressions some interpretation may be made in relying upon the law on the question, it may be necessary to re-state the law by way of clarification. Such as suggestion has all the force. It must be stated that the law laid down in Mahendra Kumar and Anr. v. State Bank of Madhya Pradesh and Ors. (2 supra) is not different from what this Court applied or interpreted or by even applying the ratio laid down by the Supreme Court in Mahendra Kumar and Anr. v. State Bank of Madhya Pradesh and Ors. (2 supra) and by the Orissa High Court in Mengulu Pirai v. Profulla Kumar Singh and Ors. (3 supra) the result may not be different and it may be re-stated by way of clarification. To re-state the law on the question, under Order 8 Rule 6-A of C.P.C. a counter-claim cannot be filed after filing written statement but it can be filed, provided the cause of action for the counter-claim had accrued to the defendant before filing the written statement and that it is delivered before the time limited for delivering his defence has expired. Therefore, on such a ground, the judgment of this Court does not warrant review.
7. Another ground raised by Mr. Anjaneyulu, learned Advocate for the petitioner is that the Court not considering the effect of Order 8 Rule 8 C.P.C. as it was not brought to the notice of the Court by the learned Advocates for the parties in the petition, which would have influences the Court to come to a different conclusion, amounts to an error apparent on the face of the record which requires rectification by way of review by this Court. It has all the force. Patently, such a provision was not brought to the notice of this Court while dealing with such a matter. When such a provision has a bearing on the negligence of the petitioner one way or the other leading to different results altogether, that can be held to be an error apparent on the face of the record warranting review of the judgment in these proceedings. Order 8 Rule 6-A C.P.C. reads as follows:-
"6-A. (1) A defendant in a suit may, in addition to his right of pleading a set-off under Rule 6, set up by way of counter-claim against the claim of the plaintiff, and right or claim in respect of a cause of action accruing to the defendant against the plaintiff either before or after the filing of the suit but before the defendant had delivered his defence or before the time limited for delivering his defence has expired, whether such counter- claim is in the nature of a claim for damages or not:
Provided that such counter-claim shall not exceed the pecuniary limits of the jurisdiction of the Court.
(2) Such counter-claim shall have the same effect as a cross-suit so as to enable the Court to pronounce a final judgment in the same suit, both on the original claim and on the counter-claim.
(3) The plaintiff shall be at liberty to file a written statement in answer to the counter-claim of the defendant within such period as may be fixed by the Court.
(4) The Counter-claim shall be treated as a plaint and governed by the rules applicable to plaints."
The simple meaning of this provision is that any ground of defence which has arisen as a subsequent event, viz after filing of a suit or filing of the written statement, which may include claim of suit or counter-claim, may be permitted to be raised before or after filing of written statement. The law is so trite that such an opportunity is provided both to the plaintiff and the defendant. It may mean that in certain circumstances having due regard to the subsequent events, the parties may be obliged to place certain matters on record so that the Court will be able to render absolute and complete justice to the parties in the very proceedings instead of driving them to different proceedings. Here is a case wherein the present petitioner, who is the defendant in the suit, was called upon to pay certain debts of the Bank-plaintiff in the suit, in a transaction wherein certain machinery of the petitioner had been hypothecated to the plaintiff-Bank. The proposed amendment by way of counter-claim has alleged that such a security of the machinery has been lost when it caught fire on 6-3-1992, where by the defendant is deprived of the machinery hypothecated with the Bank and was also made to pay the debt once again which was actually covered by the security. It appears the allegation is that no insurance was taken. From the tenor of such defence, it appears that the petitioner has attributed laches on the part of the plaintiff-Bank in not preserving or saving the security for not only the benefit of the Bank but also to the benefit of the defendant and to discharge the debt and that by not taking insurance to indemnify such a loss.
8. Admittedly, such an event occurred after filing the written statement. Obviously, the defendant could not have brought that fact to the notice of the Court before filing the written statement. Therefore, as a matter of subsequent event, the defendant was entitled to bring it to the notice of the Court, which the Court was bound to consider and decide the same in accordance with law. Mr. Anjaneyulu, the learned Advocate points out that assuming that the value of the security so lost in the fire accident exceeds the actual debt due to the negligence or the laches of the plaintiff-Bank, the defendant would be put to liability afresh and the loss as a consequence. Mr. Anjaneyulu says that the value of such secured debt is already assessed to be Rs. 48,00,000/- in the proposed counter-claim defence. In para 6 of the counter-claim, the actual claim of the suit is shown as Rs. 7 1 /2 lakhs. In such circumstances, it was possible that the Court was in a position to examine whether such a security was lost due to the laches of the Bank-plaintiff or otherwise or for any other reason and whether the defendant was put to loss in several aspects, and in the circumstances, he was entitled to recover any amount from the plaintiff either by way of counter-claim or to seek set off to the extent of the claim in the suit. Therefore, it was a fit case wherein it was possible for the trial Court or this Court to examine whether Order 8 Rule 6-A was attracted. Although the interlocutory application- CM.P.No. 7936/95 was filed under Order 6 Rule 17 C.P.C. in essence, it could have been under Order 8 Rule 8 C.P.C. only. While Order 6 Rule 17 C.P.C. is a sweeping and general enabling provision to seek amendment of pleadings, Order 8 Rule 8 C.P.C appears to be a specific instance of entitling the party to seek counter-claim or set off under such circumstances by way of amending pleadings. Therefore if the parties had placed such a provision before the Court for its consideration, or if the Court had considered it in the light of the circumstances made out, it was possible to examine whether the defendant could or could not have been permitted to raise any ground of defence under the circumstances stated above including the plea of counter-claim or set off. To re-state the principle again, it was a fit case wherein the defendant could have been permitted to raise such a ground of defence under Order 8 Rule 8 of C.P.C. Patently, no laches on the part of the defendant in raising such a plea after filing the written statement were raised, much less, could be entertained. As already pointed out, it was also not injustice to plaintiff much less substantial, to be accepted by this Court that by allowing such an amendment by way of ground of defence, it would change the character of the suit or rob the plaintiff from any such vested right which had accrued to him before raising such a ground of defence which cannot be compensated by costs. Therefore, it was a fit case to permit the defendant to raise such a ground by way of defence.
9. A doubt was raised whether Order 8 Rule 6-A and Order 8 Rule 8 of C.P (sic) are conflicting with each other and whether the interpretation of Order 8 Rules 8 and 9 of C.P.C. would defeat the real intention of the Legislature under Order 8 Rule 6-A of C.P.C. By a careful reading of both the provisions and on a harmonious interpretation of the same, this Court is not able to see any conflict. Even if they are read together, the simple interpretation emerges that Order 8 Rule 6A debars the defendant from setting up any counter-claim or set off after filing written statement except in the circumstances stated above. But Order 8 Rule 8 gives him an opportunity to raise a ground of defence after filing the written statement claiming a set off or counter claim. The difference appears to be that in the former the expression used is "setting of set off or counter claim against the claim of the plaintiff in respect of a cause of action before filing the written statement", whereas in the latter provision, viz. Order 8 Rule 8, the defendant will be permitted to raise a ground of defence in regard to such a claim. Setting of counter claim under the former provision would be something different from raising a defence in regard to a counter-claim or set off. In case a counter claim is set up it has got all the characteristics of a suit, whereby the parties are bound by the law of pleadings etc. including payment of Court fees etc. In regard to the latter provision, if merely by raising a defence to counter claim or set off in case the claim of the plain tiff in the suit can be adjusted by way of set off, no question of allowing the counterclaim will arise. If such a counter claim is found to be true during the trial, the Court can definitely pass a decree in favour of the defendant subject to payment of Court-fee etc. As rightly pointed out by the learned Advocate Mr.Anjaneyulu for the petitioner, the Court has power under Order 7 Rule 7 C.P.C. to mould the relief, modify the relief or adjust the relief claimed to meet the ends of justice having due regard to changed circumstances. The reliance on the authoritative pronouncements of the Supreme Court in Ravinder Kumar Ghose of this Court in Mahendrada Ramayya and Ors. v. Mahendrada Govindu and Anr. and also in Boddu Venkaiah v. Aripirala Venkata Rao justifies such a course to be adopted by this Court. It cannot be forgotten that the parties cannot be driven to unnecessary litigations at the cost of unnecessary expenditure, waste of time, Labour, etc. etc. Admittedly, the subject matter of the plaint and the counter-claim or set off for ground of defence is the same. The ground for set off which is said to have been lodged would be the subject matter for the counter claim and set off also. Although the causes of action were different which accrued due to the different events taking place at different times, the trial of such questions would involve common questions of law and fact to lead to some finality in the litigation between the parties. That is also one of the grounds of law for such a ground by way of defence under Order 8 Rule 8 of C.P.C. in favour of the defendant.
10. Patently, the learned Subordinate Judge did not commit any illegality or error in disposing of I.A.No.412 of 1992 in O.S.No. 44 of 1989 as had been done by this Court. Perhaps, no such grounds were raised or agitated before the trial Court. The fault lies not with the Court and it should be squarely be borne by the parties and their advocates. However, this Court cannot forget its duty to render justice to the cause and not to the individuals. Therefore, this Court is of the considered opinion that the judgment of this Court in the Civil Revision Petition deserves to be reviewed, to be disposed of in the following terms:-
The review petition succeeds. The defendant, viz. the petitioner, shall be permitted to raise the ground of defence of the counter-claim and set off by way of amending the written statement in accordance with Order 8 Rule 8 C.P.C. and in the light of the observations made above. However, the petitioner may be put to terms of costs, viz., he shall pay Rs. 2,000/- to the defendant (sic. plaintiff), viz. the respondent by way of costs to have the benefit of this Order. The matter is remitted back to the trial Court for disposal according to law and in the light of the observations made above. The petitioner may deposit the costs within one month from today or pay them to the learned advocate for the respondent within the stipulated period.