Effect of not preferring counter claim under order viii rule 6a cpc
sahil gupta
(Querist) 12 December 2012
This query is : Resolved
One of the issue framed in a civil suit states as follows:
"5. Relief.No other issue is pressed for. The defendant had replied
plaintiff’s demand notice, prior to the suit, the contentions expressed in
written statement are also containing in the reply. The reply also narrates
counter claim of Rs. 32,36,916/, however, the counter claim under order VIII
rule 6A CPC has not been preferred by the defendant. Therefore, issues No.
1 and 2 have been framed keeping in view the contents of written statement.
List for plaintiff's evidence on 28.03.2013"
Please suggest its effect
ajay sethi
(Expert) 12 December 2012
counter-claim could be made by a defendant in a suit before he has delivered his defence or before the time limit for delivering his defence has expired. you have not filed counter claim before wirtten statement
the court has dfframed issues as per WS
sahil gupta
(Querist) 12 December 2012
what are its effects?
My advocate informed me that as the matter was in Delhi jurisdiction before Add. Dist. Judge, counter claim was not preferred by him and if it is to be preferred, it can be only before Delhi High Court as Lower courts have pecuniary jurisdiction upto Rs.20Lakhs only.
How should we proceed in this matter?
sahil gupta
(Querist) 12 December 2012
CS No. ___/11
05.12.2012
Order
(on defendant's application dated 18.04.2012 under section 20 CPC)
Appearance: Proxy counsel for plaintiff.
Counsel for defendant.
1. (Introduction): Plaintiff files suit for recovery of money with interest
on the basis of bills, invoices and purchase order and it is claimed that
negotiations for supply of goods were held between the parties at plaintiff’s
office in Delhi, the goods were delivered and dispatched from Delhi office,
the parties had also agreed by invoices that all disputes will be subject to
New Delhi jurisdiction vis a vis cause of action has accrued in Delhi and
Delhi court has territorial jurisdiction. Whereas, the defendant has opposed
the suit, inter alia, on various grounds vis a vis Delhi Court lacks jurisdiction
because the contract between the parties was executed in Indore, Madhya
Pradesh, delivery and installation of signage/goods were delivered/installed
in Ujjain, Madhya Pradesh by the plaintiff, the dispute about the quality of
signages and balance payment also arose at Ujjain, Madhya Pradesh,
therefore, the court at Delhi lacks territorial jurisdiction. Secondly, the
defendant's registered office is in Madhya Pradesh and Corporate Office is in
Indore, Madhya Pradesh and from the point of view of Section 20 CPC, the
court at Delhi lacks territorial jurisdiction.
2.1 In the application, under consideration, the
applicant/defendant reiterates its contentions that neither the defendant's
office is in Delhi nor the purchase order was placed at Delhi nor the goods
were delivered and installed at Delhi, therefore, court at Delhi has no
jurisdiction. The defendant's office is in Mumbai and corporate office at
Indore, M.P, where, signages etc, were to be installed and dispute with
regard to quality and breakage had also arisen at M.P. There were inferior
quality of wrong directions, wrong words and broken signages. This has also
occurred at Ujjain. The purchase order was also handed over to the plaintiff
at Ujjain, M.P. Therefore, circumstances are hit by section 20 CPC and Delhi
court has no jurisdiction.
2.2 During the course of arguments similar contentions have
been advanced while going through purchase order correspondence by email
and invoices to highlight and demonstrate that no cause of action had
accrued in Delhi as the work place of installation of signages or delivery of
articles were in M.P. The plaintiff could have filed suit either at M.P. where
cause of action had arisen or in Mumbai where defendant had registered
office. The Delhi court lacks jurisdiction. The plaintiff relies upon invoices
carrying clause No. 5 “subject to New Delhi jurisdiction only”, however, it
carries no merit as retail invoices are not contract.
3.1 The plaintiff has opposed the application by detailed reply,
reiterating contentions already referred in paragraph 1 of this order as
introduction. The court at Delhi has jurisdiction, firstly, the purchase order
was placed to plaintiff in Delhi, secondly, the contract concluded at Delhi,
thirdly, the articles were sent from Delhi, the defendant had tendered
payment in Delhi and balance amount was also to be tendered in Delhi,
being reflected from the documentary record of invoices, statement of
account, purchase order and correspondence, which clearly carries plaintiff's
address of Govind Puri, Kalkaji, New Delhi – 19 which falls within the
territorial jurisdiction of present court. Moreover, the retail invoices clearly
spells out “subject to New Delhi jurisdiction only”, therefore, the court at Delhi
has jurisdiction as cause of action has arisen in Delhi.
3.2 During the course of arguments, similar contentions have
been advanced and arguments are fortified by the following case laws:
1. M/s KIG Systel Ltd. vs M/s Fujitsu ICIM Ltd. AIR 2001 Delhi 357 – held
that it is trite to state that the cause of action arises at different times,
and at different places, and any of these would be a legitimate venue
for suing. No triable issue therefore arises on this account.
2. M/s Continental & Easter Agencies v/s Coal India Ltd. & Ors AIR 2003
Delhi 387 – held that admittedly, the contract was communicated to the
plaintiff at Delhi and payment of the commission to the plaintiff was to
be made at Delhi. To expect the plaintiff to go to Calcutta to claim his
commission is not the intention of the provisions of Section 20 of the
CPC. It would be too much and highly jeopardic to ask the plaintiff to
file the suit at Calcutta as section 20(c) entitles a person to sue when
part of cause of action arises. In the instant case the part of cause of
action has arisen in Delhi inasmuch as the contract was
communicated at Delhi and payment of commission was also payable
at Delhi. As such the issue is decided in favour of the plaintiff and
against the defendants.
3. M/s Dura Line India Pvt. Ltd vs M/s BPL Broadband Network Pvt. Ltd
AIR 2004 Delhi 186 – held that the purchase order issued by the
defendant were received at Delhi. Hence the communication of the
acceptance was at Delhi. Also the contract having been concluded in
Delhi, payments received in Delhi, material part of cause of action had
arisen in Delhi, Delhi courts would have jurisdiction.
4. M/s Hanil Era Textiles Ltd. vs M/s Puromatic Filters (P) Ltd. AIR 2004
SC 2432 – held that having regard to the fact that the order was
placed by the defendant at Bombay, the said order was accepted by
the branch office of the plaintiff at Bombay; the advance payment was
made by the defendant at Bombay; and as per the plaintiff's case the
final payment was to be made at Bombay; there was a clear intention
to confine the jurisdiction of the courts in Bombay to the exclusion of
all other courts.
3.3 Ld. Counsel for defendant requests the ratio of law laid
down in aforementioned cases does not apply to the situation in hand, since,
cause of action is pertaining to the circumstances of quality and quantity vis
a vis breakage happened in Madhya Pradesh, subsequent to delivery of
material or raw material, therefore, the episode of supply of material end in
one phase and the second phase of installation began in Madhya Pradesh,
therefore, cause of action has arisen in M.P and not in Delhi.
4. (Findings): The contentions of both sides are assessed in the light of
feature of the case and provisions of law of section 20 CPC. There are three
parts of section 20 viz. 20(a), 20(b) and 20(c), former two parts of section 20
(a) & 20(b) are pertaining to whether the defendant carries all business or
having residence or place for work for gain and section 20(c) is with regard to
place where cause of action has arisen, partly or wholly. The defendant's
contentions are two fold that its registered office is in Mumbai and corporate
office is in M.P., which pertains to section 20(a) and 20(b). The other limb of
arguments of defendant is that place of implementation of work order was in
Ujjain, M.P, where purchase order was issued and accepted vis a vis delivery
and installation of singages or dispute with regard to quality had arisen, this
argument pertains to clause 20(c) CPC.
Whereas, the plaintiff contentions are that goods were
delivered from Delhi and cause of action started emerging from Delhi upto
the place where goods were delivered or installed vis a vis payments were
tendered at Delhi where purchase order/contract was concluded. The
statement of account also reflects that payments were tendered at Delhi.
4.2 Clauses section 20(a), 20(b) and 20(c) are in alternate
and on satisfying any of the clause, the jurisdiction lies which one clause is
satisfied. In the situation in hand, each party is stressing on one clause of
section 20 CPC. So far registered office of defendant at Mumbai or
corporate office at M.P. is concerned it is not disputed but option lies with the
plaintiff whether it intends to invoke clause 20(a) or 20(b) CPC, this option
has not been exercised by the plaintiff.
4.3 The suit has been filed on the basis of cause of action and
there are rival contentions with regard to purchase order as plaintiff claims it
was placed at Delhi but according to defendant it was handed over at Ujjain,
M.P. In the entire correspondence/documentary record, the plaintiff address
is throughout 115A, Gali No. 2, Govind Puri, Opposite Kalkaji Depot, New
Delhi – 19 and no where there is any other address of the plaintiff. The
purchase order, the backbone of the contract, also bears plaintiff's address
of Govind Puri, Opposite Kalkaji Depot, New Delhi, which was subsequent to
plaintiff's quotation dated 30.06.2010 and discussion carried on 08.07.2010.
The contract was concluded at Delhi as purchase order has been sent to the
plaintiff at Delhi. The invoices also reflect dispatch of goods from Delhi to
defendant at Indore and Ujjain, M.P. Therefore, requirement of section 20(c)
that jurisdiction lies where the cause of action arises partly or wholly is
satisfied. This also makes out jurisdiction of Delhi. The retail invoices/cash
memo also make terms and conditions “subject to New Delhi jurisdiction
only” and when there are more than one place having concurrent jurisdiction,
the parties may agree for jurisdiction at one place, which not against public
policy, reliance can be placed on ABC Laminart Pvt. Ltd. vs A.P. Agencies,
Salem AIR 1989 SC 1239. When there are series of events from supply of
material till final phase of installation, the each event of such transaction
would constitute part of complete transaction. Defendant's contentions are
misplaced that cause of action is to be viewed after supply of material from
Delhi to Madhya Pradesh. The supply of raw material is a way to completion
of contract/transaction. To say, cause of action has also arisen in Delhi and
one of the place for jurisdiction is Delhi and parties have also agreed for New
Delhi jurisdiction. The jurisdiction lies with the Delhi court. The application
under section 20 CPC is devoid of merit, hence, dismissed. Accordingly, the
issue on the point of jurisdiction stand adjudicated and there will be no
further need to frame issue on the point of territorial jurisdiction of the court.
The pleadings are complete. The following issues emerge for
determination:1.
Whether the suit is without cause of action, since there was poor
quality work vis a vis there were defective/wrong/broken signages by
the plaintiff, if so, its consequences? OPD
2. Whether the defendant engaged another vendor Mr. Mukesh Londhe
of Artsol for necessary repair and rectification of signage work, if so, its
consequences? OPD
3. Whether the plaintiff is entitled for decree of Rs. 6,94,469/(
i.e.,
balance /principal amount of Rs. 5,72,309/+
interest 1,22,160/)?
OPP
4. Whether the plaintiff is entitled for pendentilite and future interest @
24% p.a, against the defendant? OPP
5. Relief.
No other issue is pressed for. The defendant had replied
plaintiff’s demand notice, prior to the suit, the contentions expressed in
written statement are also containing in the reply. The reply also narrates
counter claim of Rs. 32,36,916/,
however, the counter claim under order VIII
rule 6A CPC has not been preferred by the defendant. Therefore, issues No.
1 and 2 have been framed keeping in view the contents of written statement.
List for plaintiff's evidence on 28.03.2013. Advance copy of affidavit along
with list of witnesses be forwarded to opposite side one month before the
date of hearing.
Addl. District Judge03,
South District,
S Saket/05.12.2012
ajay sethi
(Expert) 12 December 2012
the issue as to jursidtion has been decided . court has held that delhi has jurisdiction .
your counter claim will not be considered as you have already filed your WS . the counter claim ought to have been filed before filing WS
sahil gupta
(Querist) 12 December 2012
1. Should we prefer appeal against the abovesaid order?
2. I also want to confirm whether we were misguided by our Advocate, as per his opinion as the matter was in Delhi jurisdiction before Add. Dist. Judge, counter claim was not preferred by him and if it is to be preferred, it can be only before Delhi High Court as Lower courts have pecuniary jurisdiction upto Rs.20Lakhs only."
3. Any alternate remedy available to us? how should we prove our abovesaid claim?
4. Should we file a civil suit against the plaintiff (same facts) at Madhya Pradesh (Ujjain)?
ajay sethi
(Expert) 12 December 2012
it is well settled law that counter claim has to be filed before defendant has delivered his defence or before time limit for filing has expired .
no sense in filing appeal aginst said order .
i am not aware as to jurisdiction of lower courts in delhi . better contact a local lawyer in delhi .
contact Anirudh from LCI . he is from Delhi . take his opinion .
sahil gupta
(Querist) 12 December 2012
Thanks a lot for quick response and kind help sir.
ajay sethi
(Expert) 12 December 2012
thanks for your appreciation
sahil gupta
(Querist) 12 December 2012
Any expert From Delhi? Pls help
1. Should we prefer appeal against the abovesaid order?
2. I also want to confirm whether we were misguided by our Advocate, as per his opinion as the matter was in Delhi jurisdiction before Add. Dist. Judge, counter claim was not preferred by him and if it is to be preferred, it can be only before Delhi High Court as Lower courts have pecuniary jurisdiction upto Rs.20Lakhs only."
3. Any alternate remedy available to us? how should we prove our abovesaid claim?
4. Should we file a civil suit against the plaintiff (same facts) at Madhya Pradesh (Ujjain)?
Raj Kumar Makkad
(Expert) 12 December 2012
1. No. The order is perfect.
2. You have separate cause of action against your outstanding so better to file civil suit for recovery at Ujjain or Mumbai but dont forget to mention the pendancy of the suit at Delhi.
3. As replied above.
4. Yes.
prabhakar singh
(Expert) 12 December 2012
1.You may file appeal but the SAME WOULD BE A FUTILE EFFORT.
2.SINCE YOU DID NOT FILE COUNTER CLAIM,A SUIT IS YOUR NECESSITY BUT THE THE SAME SHOULD NOW BE FILED IN DELHI ONLY BECAUSE THE COURT HELD :
" To say, cause of action has also arisen in Delhi and one of the place for jurisdiction is Delhi and parties have also agreed for New Delhi jurisdiction."
3.YOU DO NEED TO FILE A SUIT.
4. SUIT BUT REQUIRED TO BE FILED IN DELHI.
Raj Kumar Makkad
(Expert) 12 December 2012
With humble disagreement with the advice of Ld. Prabhakar Sir, I again confirm that the proper jurisdiction for you shall be MP because your claim is based upon the loss and damages to the supplied items by supplier which you received or came to know at MP only so the proper place for you is MP and not Delhi to sue for damages/outstanding amount.
prabhakar singh
(Expert) 12 December 2012
Ld. Mr. Makkad has a right to differ which I do not dispute but since you have agreed to submit to the jurisdiction of Delhi where part of cause of action arose out of the same transaction,unless you successfully assail this finding by appeal,jurisdiction would be of Delhi courts only here now between you two.
sahil gupta
(Querist) 13 December 2012
Both the opinions (Ld. Mr. Makkar & Ld. Mr. Singh) were in my mind and creating confusion.
1. If there is any precedent available, please provide to support your arguments.
2. In case I proceed to file the suit in Ujjain and for arguments sake lets suppose the case is dismissed on ground of jurisdiction, Can I still file a suit at Delhi? What would be the consequences that would follow?
ajay sethi
(Expert) 13 December 2012
in my opinion file suit in delhi
the order mentions as under
plaintiff address
is throughout 115A, Gali No. 2, Govind Puri, Opposite Kalkaji Depot, New
Delhi – 19 and no where there is any other address of the plaintiff. The
purchase order, the backbone of the contract, also bears plaintiff's address
of Govind Puri, Opposite Kalkaji Depot, New Delhi, which was subsequent to
plaintiff's quotation dated 30.06.2010 and discussion carried on 08.07.2010.
The contract was concluded at Delhi as purchase order has been sent to the
plaintiff at Delhi. The invoices also reflect dispatch of goods from Delhi to
defendant at Indore and Ujjain, M.P. Therefore, requirement of section 20(c)
that jurisdiction lies where the cause of action arises partly or wholly is
satisfied. This also makes out jurisdiction of DelhiThe retail invoices/cash
memo also make terms and conditions “subject to New Delhi jurisdiction
only” and when there are more than one place having concurrent jurisdiction,
the parties may agree for jurisdiction at one place
sahil gupta
(Querist) 13 December 2012
Ajay Sir,
The facts stated above by you are correct but I am clarifying that Purchase order issued by defendant (our company) has name and address of Plaintiff (New Delhi) as well as Defendant(Indore & Mumbai). And, it is our company's practice that all the purchase order's are to be executed at Indore (Which is corporate office). It is no where mentioned that the Purchase order was executed at New Delhi or Indore, can we take this plea that burden of proof is on Plaintiff to proove the documents are executed at New Delhi?
ajay sethi
(Expert) 13 December 2012
clause in your contract that subject to jurisdiction at delhi only . part of cause of action has arisen in delhi . it is your call
prabhakar singh
(Expert) 13 December 2012
In case you prefer to file the suit in M.P.
and the same gets dismissed for want of territorial jurisdiction,then fresh suit in Delhi would be possible subject to law of limitation.
I do not know why you are not opting to file the suit in same court where plaintiff suit is going on.
If you do so it would be possible to serve the summons easily and your suit shall get consolidated with their's suit,a common trial shall go,there would not be chances of any contradictory evidence and both the suits would get decided by one common judgement.
Chance of counter claim already missed by you,at least do not miss this suggested course unless you hate to have some strategy to follow in litigation.
Raj Kumar Makkad
(Expert) 13 December 2012
*Prabhakar Sir! The subsequent suit cannot be filed before lower court at Delhi due to pecuniary jurisdiction as already clarified and the same can be filed only before High Court at Delhi whereas the earlier suit is going on before lower court so question of clubbing of both suit do not arise.
*Gupta! Section 20(c) provides that every suit shall be instituted in a Court within the local limits of whose jurisdiction the cause of action wholly or in part arises. The expression "cause of action" has received judicial interpretation on numerous occasions. Every student of the Code is familiar with the explanation of this expression which describes it as a bundle of essential facts necessary to be proved by the plaintiff in order to succeed in his suit. This explanation appears to be clear and facile; but it is not always easy to decide which facts can legitimately enter this bundle and which must be excluded from it. The observations of Lord Justice Fry in -- 'Read v. Brown', (1888) 22 Q B D 128 at p. 132 (A) which explain the meaning of the expression "Cause of action" have now become a classic on the subject and are cited by every commentator on the Code of Civil Procedure:
"Everything," observed Lord Justice Fry "which, if not proved, gives the defendant an immediate right to judgment, must be part of the cause of action."
Mr. Justice Brett put the same position in a somewhat different form in -- 'Cooke v. Gill', (1873) LR 8 CP 107 (B) by making this lucid observation (p. 116):
" 'Cause of action' has been held from the earliest time to mean every fact which is material to be: proved to entitle the plaintiff to succeed,--every fact which the defendant would have a right to traverse".
It is, however, important to bear in mind that the bundle of facts which constitute the cause of action in a civil suit does not and is not intended to comprise every fact which may be proved in evidence. It is only material facts which must be proved by the plaintiff before he can obtain a decree that constitute the cause of action. Facts which the plaintiff may allege incidentally and facts which may be brought in evidence as 'res gestae' would not necessarily constitute a part of the cause of action. The distinction between facts which are relevant and material and those that are incidental and immaterial is sometimes not easy to be drawn; but the said distinction is nevertheless important for the purpose of deciding which facts constitute the cause of action and which are not included in it. The position under Section 20(c) is very clear, if it is shown by the plaintiff that the cause of action has arisen wholly or in part within the local limits of the jurisdiction of the trial Court, the trial Court would be entitled to deal with the suit.
Raj Kumar Makkad
(Expert) 13 December 2012
In interpreting this clause it may perhaps be relevant to refer to the history of this clause in the Code of Civil Procedure. The Code of 1882 merely provided that the Court, within whose local jurisdiction the cause of action has accrued would be competent to try the suit. Under this provision it was not clear whether jurisdiction was conferred on the civil Court only in case the whole of the cause of action had accrued within the local limits of its jurisdiction or whether it would be enough if only a part of the cause of action had accrued within its jurisdiction. In order to remove the doubt on this point, Section 7 of Act 7 Of 1888 added an Explanation. This was Explanation 3 to Section 17 of the earlier Code.
This Explanation specifically provided that in suits arising out of contract, the cause of action arises within the meaning of Section 17 at any of the three places mentioned in cls. (1), (2) and (3) of the Explanation. Under these clauses the place where the contract was made, the place where the contract was to be performed or performance thereof was to be completed and the place where in performance of the contract any money to which the suit relates was expressly or impliedly payable, were mentioned as places at which the suit could be filed.
Raj Kumar Makkad
(Expert) 13 December 2012
Refer
Bombay High Court
Baroda Oil Cakes Traders vs Parshottam Narayandas Bagulia
AIR 1954 Bom 491, (
1954) 56 BOMLR 575,
ILR 1954 Bom 137
sahil gupta
(Querist) 18 December 2012
Thanks a lot sir...
