Madras High Court
S. Nehru vs M/S. Sriram City Union Finance Limited on 4 September, 2019
Bench: S.Manikumar, D.Krishnakumar
O.S.A.SR.Nos.74162, 74164
and 74166 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 4/9/2019
CORAM
THE HON'BLE Mr.JUSTICE S.MANIKUMAR
AND
THE HON'BLE Mr.JUSTICE D.KRISHNAKUMAR
Original Side Appeal SR.Nos.74164, 74166 and 74162 of 2019
and
C.M.P.Nos.14824, 14825 and 14829 of 2019
S. Nehru ... Appellant
Vs
M/s. Sriram City Union Finance Limited
rep. By its Authorised Signatory
Ms.E.Ramya
Having its Registered Office at
No.123 Angappa Naicken Street
Chennai. ... Respondent
Original Side Appeal filed under Section 37 of the Arbitration
and Conciliation Act, 1996, r/w. Order XXXVI Rule 1 of Original Side
Rules, against the order, dated 21/3/2019 in Application No.4402,
4403 and 4404 of 2018.
For appellants ... Mr.A.D.Janarthanan
------
http://www.judis.nic.in
1/11
O.S.A.SR.Nos.74162, 74164
and 74166 of 2019
COMMON JUDGMENT
(Judgment of the Court was made by S.MANIKUMAR, J) Instant Original Side Appeals are filed against the common order, dated 21/3/2019, in Application Nos.4402, 4403 and 4404 of 2018, by which a learned Single Judge, has ordered as hereunder:-
“The learned counsel appearing for the applicant as well as the respondent submitted that after negotiation some settlement has been reached, according to which, the total due of Rs.3.2 crores have been reduced to Rs.2.8 crores, which shall be paid by the respondent. Out of said sum of Rs.2.8 crores reduced due, since the respondent has already paid Rs.1,00,00,000/- (Rupees One Crore only), the remaining due shall be Rs.1.8 crores.
2. This Rs.1.8 crores due as of now shall be repaid with the following schedule:
(1). that the respondent shall pay a sum of Rs.80,00,000/- (Rupees Eighty lakhs only) on or before 15/4/2019;
(2). the remaining sum of Rs.1,00,00,000/- (Rupees One crore only) shall be paid on or before 15/5/2019 (3). With these time schedule, the entire amount of Rs.1.8 crores shall be paid by the respondent and once this amount is received, as per the aforementioned schedule, the applicant company shall close the account.
3. It is made clear that if the respondent has not paid the amount as per the schedule referred to above or not strictly adhered to the time schedule, it is open to the applicant company to proceed against the respondent, which includes the receiver already been appointed in this matter, can proceed in accordance with law.
With this observation/order these applications are disposed of.” http://www.judis.nic.in 2/11 O.S.A.SR.Nos.74162, 74164 and 74166 of 2019
2. Though grounds have been raised in O.S.A.SR.Nos.74164, 74166 and 74162 of 2019 filed along with a petition in C.M.P.Nos.14824, 14825 and 14829 of 2019, to condone the delay of 48 days in filing the Original Side Appeals, learned counsel appearing for the respondent submitted that the appellant has filed Applications, for extension of time, for compliance of the common order, made in Application Nos.4402 to 4404 of 2018, dated 21/3/2019 and that the same has been dismissed for non-prosecution. Learned counsel appearing for the respondent further submitted that the appellant cannot be permitted to approbate and reprobate by challenging the very same order in Application Nos.4402 to 4404 of 2018, dated 21/3/2019.
3. Learned counsel appearing for the appellant, seeks permission of this Court, to withdraw the instant Original Side Appeal SR.Nos.74164, 74166 and 74162 of 2019 filed along with C.M.P.Nos.14824, 14825 and 14829 of 2019. He has also made an endorsement to that effect.
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4. We agree with the submission of the learned counsel for the respondents. In New Bihar Biri Leaves Co. Vs. State of Bihar, reported in 1981 (1) SCC 537, at paragraphs 48 and 49, the Supreme Court held as follows:-
"48. It is a fundamental principle of general application that if a person of his own accord, accepts a contract on certain terms and works out the contract, he cannot be allowed to adhere to and abide by some of the terms of the contract which proved advantageous to him and repudiate the other terms of the same contract which might be disadvantageous to him. The maxim is qui approbat non reprobat (one who approbates cannot reprobate). This principle, though originally borrowed from Scots Law, is now firmly embodied in English Common Law. According to it, a party to an instrument or transaction cannot take advantage of one part of a document or transaction and reject the rest. That is to say, no party can accept and reject the same instrument or transaction (Per Scrutton, L.J., Verschures Creameries Ltd. v. Hull & Netherlands Steamship Co., reported in 1921 2 KB 608 Douglas Menzies v. Umphelby, reported in 1908 AC 224, 232 see also stroud's judicial dictionary, Vol. I, p. 169, 3rd Edn.).
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49. The aforesaid inhibitory principle squarely applies to the cases of those petitioners who had by offering highest bids at public auctions or by tenders, accepted and worked out the contracts in the past but are now resisting the demands or other action, arising out of the impugned Condition (13) on the ground that this condition is violative of Articles 19(1)(g) and 14 of the Constitution. In this connection, it will bear repetition, here, that the impugned conditions though bear a statutory complexion, retain their basic contractual character also. It is true that a person cannot be debarred from enforcing his fundamental rights on the ground of estoppel or waiver. But the aforesaid principle which prohibits a party to a transaction from approbating a part of its conditions and reprobating the rest, is different from the doctrine of estoppel or waiver.
5. In R.N.Gosain Vs. Yashpal Dhir, reported in 1992 (4) SCC 683, at paragraph 10, the Supreme Court held as follows:-
10. Law does not permit a person to both approbate and reprobate. This principle is based on the doctrine of election which postulates that no party can accept and reject the same instrument and that “a person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on http://www.judis.nic.in 5/11 O.S.A.SR.Nos.74162, 74164 and 74166 of 2019 the footing that it is valid, and then turn round and say it is void for the purpose of securing some other advantage”. [See: Verschures Creameries Ltd. v. Hull and Netherlands Steamship Co. Ltd, reported in 1921 (2) KB 608, 612 (CA) Scrutton, L.J.] According to Halsbury's Laws of England, 4th Edn., Vol. 16, “after taking an advantage under an order (for example for the payment of costs) a party may be precluded from saying that it is invalid and asking to set it aside”. (para 1508)
6. In I.T. Commissioner Vs. Firm Muar, reported in AIR 1965 SC 1216, at paragraph 13, the Supreme Court held as follows:-
".........The doctrine of “approbate and reprobate” is only a species of estoppel; it applies only to the conduct of parties. As in the case of estoppel, it cannot operate against the provisions of a statute."
7. In Prashant Ramachandra Deshpande Vs. Maruti Balaram Haibatti, reported in 1995 Supp (2) 539, the principle of "approbate and reprobate" has been explained. At Paragraph 2, it is held, "2. .........Similarly, on the principle that a person may not approbate and reprobate, “a species of estoppel http://www.judis.nic.in 6/11 O.S.A.SR.Nos.74162, 74164 and 74166 of 2019 has arisen which seems to be intermediate between estoppel by record and estoppel in pais. The principle that a person may not approbate and reprobate expresses two propositions: (1) that the person in question, having a choice between two courses of conduct, is to be treated as having made an election from which he cannot resile, and (2) that he will not be regarded, in general at any rate, as having so elected unless he has taken a benefit under or arising out of the course of conduct which he has first pursued and with which his subsequent conduct is inconsistent”. Vide Halsbury's Laws of England, 4th Edn., Vol. 16, para 1507."
8. In Cauvery Coffee Traders, Mangalore, Vs. Hornor Resources (International) Company Limited., reported in 2011 (10) SCC 420, the Supreme Court at paragraphs 33 to 35, held as follows:-
33. In R.N. Gosain v. Yashpal Dhir, reported in 1992 (4) SCC 683 = 2011 (1) SCC (Civ) 451, this Court has observed as under: (SCC pp.687-88, para 10) “10. Law does not permit a person to both approbate and reprobate. This principle is based on the doctrine of election which postulates that no party can accept and reject the same instrument and that ‘a person http://www.judis.nic.in 7/11 O.S.A.SR.Nos.74162, 74164 and 74166 of 2019 cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing that it is valid, and then turn round and say it is void for the purpose of securing some other advantage’.”
34. A party cannot be permitted to “blow hot and cold”, “fast and loose” or “approbate and reprobate”.
Where one knowingly accepts the benefits of a contract or conveyance or an order, is estopped to deny the validity or binding effect on him of such contract or conveyance or order. This rule is applied to do equity, however, it must not be applied in a manner as to violate the principles of right and good conscience. (Vide Nagubai Ammal v. B. Shama Rao, reported in AIR 1956 SC 593, CIT v. V.MR.P. Firm Muar, reported in AIR 1965 SC 1216, Maharashtra SRTC v. Balwant Regular Motor Service, reported in AIR 1969 SC 329, .R. Deshpande v. Maruti Balaram Haibatti, reported in 1998 (6) SCC 507 = AIR 1998 SC 2979, Babu Ram v. Indra Pal Singh, reported in 1998 (6) SCC 358 = AIR 1998 SC 3021, NTPC Ltd. v. Reshmi Constructions, Builders & Contractors, reported in 2004 (2) SCC 663 = AIR 2004 SC 1330, Ramesh Chandra Sankla v. Vikram Cement and Pradeep Oil Corpn. v. MCD. reported in 2008 (14) SCC 58 = 2009 (1) SCC (L&S) 706 = AIR 2009 SC 713.
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35. Thus, it is evident that the doctrine of election is based on the rule of estoppel—the principle that one cannot approbate and reprobate inheres in it. The doctrine of estoppel by election is one of the species of estoppels in pais (or equitable estoppel), which is a rule in equity. By that law, a person may be precluded by his actions or conduct or silence when it is his duty to speak, from asserting a right which he otherwise would have had.
9. In Joint Action Committee of Air Line Pilots' Association of India (ALPAI) Vs. Director General of Civil Aviation, reported in 2011 (5) SCC 435, the Supreme Court, at paragraph 12, held as follows:-
"12. The doctrine of election is based on the rule of estoppel—the principle that one cannot approbate and reprobate inheres in it. The doctrine of estoppel by election is one of the species of estoppels in pais (or equitable estoppel), which is a rule in equity. By that law, a person may be precluded by his actions or conduct or silence when it is his duty to speak, from asserting a right which he otherwise would have had. Taking inconsistent pleas by a party makes its conduct far from satisfactory. Further, the parties should not blow hot and cold by taking inconsistent stands and prolong proceedings http://www.judis.nic.in 9/11 O.S.A.SR.Nos.74162, 74164 and 74166 of 2019 unnecessarily. [Vide Babu Ram v. Indra Pal Singh, reported in 1998 (6) SCC 358, P.R. Deshpande v. Maruti Balaram Haibatti, reported in 1998 (6) SCC 507, and Mumbai International Airport (P) Ltd. v. Golden Chariot Airport [2010 (10) SCC 422 = 2010 (4) SCC (Civ) 195]."
10. Placing on record the above, O.S.A.SR.Nos.74164, 74166 and 74162 of 2019 are dismissed as withdrawn. No costs.
Consequently, connected C.M.P.Nos.14824, 14825 and 14829 of 2019 are dismissed.
(S.M.K., J) (D.K.K.,J) 4th September 2019 mvs.
Index: Yes/No website: yes/No http://www.judis.nic.in 10/11 O.S.A.SR.Nos.74162, 74164 and 74166 of 2019 S.MANIKUMAR,J & D.KRISHNAKUMAR,J mvs.
Original Side Appeal SR.Nos.
74164, 74166 and 74162 of 2019 and C.M.P.Nos.14824, 14825 and 14829 of 2019 4/9/2019 http://www.judis.nic.in 11/11