We find considerable degree of force in the contention of the
Appellant that at this stage, the learned Single Judge was not justified
in rejecting the counter claim on the ground that it was barred by
limitation. If the Defendant were to file a separate suit, there would
be no occasion for the registry of this Court to decline to register the
suit on the ground that the claim is barred by limitation. Whether the
claim is barred by limitation is a matter which would have to be
determined upon an issue being framed under Order XIV, Rules 1 and
2 of the Code of Civil Procedure, 1908. Limitation would raise a
mixed question of law and fact and ought not to have been decided on
an a priori basis, purely on affidavits.
Citation ;2013(2)MH LJ 758
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORIGINAL ORIGINAL CIVIL JURISDICTION
APPEAL NO.286 OF 2012
IN
NOTICE OF MOTION NO.1426 OF 2011
IN
SUMMARY SUIT NO.4695 OF 1997
Gulf Oil India Limited Appellant
versus
Tube Investment of India Limited Respondent
CORAM : DR.D.Y.CHANDRACHUD
AND R.D.DHANUKA, JJ.
DATE : 3 August 2012
1. Rule. Counsel for the respondent waives service. By consent,
the Rule is made returnable forthwith. The Appeal is taken up for
hearing and final disposal, by consent and on the request of learned
counsel.
2. This Appeal at the behest of the Defendant arises from a
decision of a learned Single Judge dated 21 September 2011 by which
the Court : (i) condoned the delay in filing the written statement,
1 of 4
subject to payment of costs quantified at Rs.50,000/-; and (ii) rejected
the prayer of the Plaintiff to set up a counter claim or, in the
alternative, an equitable set off, on the ground of limitation.
3. A Summary Suit was instituted in 1997 on the Original Side of
this Court. No Summons for Judgment was taken out by the Plaintiff,
but in 2009 a Notice of Motion was taken out for condonation of
delay in taking out the Summons for Judgment. The Motion for
condonation of delay was dismissed, following which the Suit was
directed to be tried as a regular suit. At that stage, the Court had
issued a direction to the Defendant to file the written statement within
twelve weeks. The Defendant failed to do so. Eventually, a Notice of
Motion was taken out by the Defendant-Appellant for condoning the
delay in filing the written statement and for taking the counter claim
on record. By the written statement, the Defendant also sought to set
up a counter claim and set off. The learned Single Judge allowed the
Notice of Motion for condonation of delay in filing the written
statement subject to payment of costs quantified at Rs.50,000/-.
However, the learned Single Judge was of the view that at that stage
the Court had the discretion to consider as to whether the counter
claim was, ex-facie, barred by limitation. The Court held that the
cause of action for the counter claim which was essentially a claim for
damages, would have arisen in the year 1995-96 on account of the
alleged delay on account of the Plaintiff in completing the project.
Hence, the view of the learned Single Judge was that the Defendant
should not be allowed to make the counter claim after nearly sixteen
years.
4. We find considerable degree of force in the contention of the
Appellant that at this stage, the learned Single Judge was not justified
in rejecting the counter claim on the ground that it was barred by
limitation. If the Defendant were to file a separate suit, there would
be no occasion for the registry of this Court to decline to register the
suit on the ground that the claim is barred by limitation. Whether the
claim is barred by limitation is a matter which would have to be
determined upon an issue being framed under Order XIV, Rules 1 and
2 of the Code of Civil Procedure, 1908. Limitation would raise a
mixed question of law and fact and ought not to have been decided on
an a priori basis, purely on affidavits. In South Konkan Distilleries
and Another Vs. Prabhakar Gajanan Naik and others1
, the issue
was whether the rejection of an application for amendment of the
written statement and counter claim was proper. The Supreme Court
held that by way of an amendment, the Appellants were seeking to
make out a new case that they were incurring damages on a
continuous basis, which was contrary to the pleadings in the written
statement and the counter claim which had already been filed. The
Supreme Court held that there was no dispute on the question of
limitation and, hence, it would not be fair and proper to hold that the
Courts below had committed any illegality or acted with material
irregularity in rejecting the application for amendment of the written
statement and counter claim.
5. The facts in the present case are, it must be noted, different.
The Defendant seeks to set up a counter claim or, in the alternative, a
1 (2008)14-SCC-632
set off, in law and on equitable grounds. Prima facie, the question of
limitation would not be relevant when an equitable set off is sought to
be pleaded. Be that as it may, we are not expressing a view on the
question as to whether the counter claim, when it proceeds to trial,
would be held to be within limitation or beyond it. At this stage, it
will be necessary for the court to allow the counter claim to be taken
on record but by keeping all the questions including limitation open.
6. We clarify on the request of counsel for the Plaintiff that this
will not preclude the Plaintiff from seeking recourse to such other
remedies as may be available in law.
7. In the circumstances, we allow the Appeal by setting aside the
impugned order of the learned Single Judge to the extent to which the
Defendant was not allowed to raise the counter claim made in
paragraphs 3(a), 3(b), 3(c) and paragraph 4(a) and prayer clause (a) of
the counter claim. The Appeal is allowed in the above terms. There
shall be no order as to costs.
(DR.D.Y.CHANDRACHUD, J.)
(R.D.DHANUKA, J.)
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