NORTH EASTERN CARRYING CORPORATION LTD vs DO BEST INFOWAY

$~22
IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 02ndJuly, 2024
+ CM(M) 2824/2024 & CM APPL. 36150-36151/2024
NORTH EASTERN CARRYING CORPORATION LTD
….. Petitioner
Through: Ms. Kirti Mewar with Ms. Mana Singh, Advocates.
versus

DO BEST INFOWAY ….. Respondent
Through:
CORAM:
HON’BLE MR. JUSTICE MANOJ JAIN
J U D G M E N T (oral)
1. Petitioner herein had filed a commercial suit before the learned Trial Court.Its adversary besides filing a written statement, also lodged a counter-claim.
2. In response to such counter-claim, the petitioner filed written statement, albeit belatedly.
3. Admittedly, such written statement had been filed on 121st day, reckoned from the relevant date.
4. Learned Trial Court vide impugned order dated 26.02.2024 directed such written statement to be taken off the record. It observed in such order that the counter-claim was subsequently sought to be amended and the amendment was allowed on 09.08.2023. Pursuant to such amendment, the amended counter claim was taken on record and the copy thereof was supplied to the petitioner herein. Order dated 09.08.2023 also records that same day, copy of such amended counter-claim was supplied to the petitioner herein.
5. However, the petitioner filed written statement only on 08.12.2023.
6. Learned Trial Court, observing that since the written statement had been filed on 121st day i.e. after expiry of outer limit of 120 days, directed the same to be struck off the record.
7. Such order is under challenge.
8. During course of the arguments, learned counsel for petitioner has, very fairly, admitted that there is delay and the written statement has indeed been filed on 121st day. It is contended that there was bereavement in the close relation of the counsel of the petitioner and also due to the ill health of his spouse, the written statement could not be filed within the stipulated period. It has been argued that there would be grave injustice if delay of mere solitary day is not condoned.
9. Legal position is no longer res integra.
10. In SCG Contracts (India) Private Limited vs. KS Chamankar Infrastructure Private Limited, (2019) 12 SCC 2010, the Hon’ble Supreme Court has, in no uncertain terms, laid down that the provision regarding filing of written statement in a commercial suit is absolute in nature and such period can neither be extended nor be permitted to be circumvented. Reference may be had to para 8 of the said judgment which reads as under:-
“8. The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 came into force on 23-10-2015 bringing in their wake certain amendments to the Code of Civil Procedure. In Order 5 Rule 1, sub-rule (1), for the second proviso, the following proviso was substituted:
“Provided further that where the defendant fails to file the written statement within the said period of thirty days, he shall be allowed to file the written statement on such other day, as may be specified by the court, for reasons to be recorded in writing and on payment of such costs as the court deems fit, but which shall not be later than one hundred twenty days from the date of service of summons and on expiry of one hundred and twenty days from the date of service of summons, the defendant shall forfeit the right to file the written statement and the court shall not allow the written statement to be taken on record.”
Equally, in Order 8 Rule 1, a new proviso was substituted as follows:
“Provided that where the defendant fails to file the written statement within the said period of thirty days, he shall be allowed to file the written statement on such other day, as may be specified by the court, for reasons to be recorded in writing and on payment of such costs as the court deems fit, but which shall not be later than one hundred and twenty days from the date of service of summons and on expiry of one hundred and twenty days from the date of service of summons, the defendant shall forfeit the right to file the written statement and the court shall not allow the written statement to be taken on record.”
This was re-emphasised by re-inserting yet another proviso in Order 8 Rule 10 CPC, which reads as under:
“10. Procedure when party fails to present written statement called for by court.—Where any party from whom a written statement is required under Rule 1 or Rule 9 fails to present the same within the time permitted or fixed by the court, as the case may be, the court shall pronounce judgment against him, or make such order in relation to the suit as it thinks fit and on the pronouncement of such judgment a decree shall be drawn up:
Provided further that no court shall make an order to extend the time provided under Rule 1 of this Order for filing of the written statement.”
A perusal of these provisions would show that ordinarily a written statement is to be filed within a period of 30 days. However, grace period of a further 90 days is granted which the Court may employ for reasons to be recorded in writing and payment of such costs as it deems fit to allow such written statement to come on record. What is of great importance is the fact that beyond 120 days from the date of service of summons, the defendant shall forfeit the right to file the written statement and the Court shall not allow the written statement to be taken on record. This is further buttressed by the proviso in Order 8 Rule 10 also adding that the court has no further power to extend the time beyond this period of 120 days.”
11. The aforesaid judgment was considered in Prakash Corporates vs. Dee Vee Projects Limited (2022) 5 SCC 112 wherein also it is held that the principle regarding timeline of mandatory period of 120 days is mandatory and binding, with little, or rather, no discretion with the adjudicating authority for enlargement of such period. The only relaxation given was because of Covid-19 pandemic, which was treated to be an ‘extraordinary situation/circumstance’. Here, unfortunately, no such extraordinary circumstance exists.
12. Ms. Kirti Mewar, learned counsel for petitioner has, however, relied upon CSCO LLC and Ors. vs. Lakshmi Saraswathi Spintex Limited and Ors.: 2019 SCC Online Mad 18261.In said case, there was a delay of 563 days in filing written statement to the counter-claim. Hon’ble Madras High Court condoned the delay while observing that the aforesaid judgment of Supreme Court in SCG Contracts (India) Private Limited (supra) merely dealt with the mandatory period fixed for filing a written statement to a suit and it did not deal with the time-period for filing a written statement to a counter-claim and observing thus, the delay was condoned.
13. This court, most humbly, does not subscribe to such view as there cannot be any distinction with respect to filing of written statement to a main suit or for that matter to a counter-claim. The period and the principle would remain the same, particularly when the counter-claim also deals with a commercial dispute.
14. In M/s. PSA Nitrogen Limited vs. Maeda Corporation & Ors.:2019 SCC Online Del 10095, this Court has categorically observed that the counter claim is also governed by the same rules as applicable to plaints and, therefore, in commercial suits in view of the provisions of Order VIII Rule 1 CPC and Order VIII Rule 10 CPC, the Court cannot make an order extending time for filing of the written statement. Undoubtedly, in the aforesaid case, the delay was condoned but it was apparently for a different reason altogether as in that case the suit was originally instituted on the Original Side of Delhi High Court and it was later on transferred to the District Court but fact remained that such counter-claim never came to be registered and, therefore, in view of the prevailing confusion in the Trial Court proceedings, the plaintiff could not file the written statement to the counter claim.
15. It has been also argued by learned counsel for the petitioner that the period for the purposes of filing written statement to a counter-claim is governed by Order VIII Rule 6A(3) CPC and, therefore, the plaintiff can file written statement in answer to such counter-claim within such period as may be fixed by the Court. However, in the case in hand, when the counter-claim was filed by the opposite side, the learned Trial Court had, in no uncertain terms, directed the petitioner herein to file written statement as per the provisions of Commercial Courts Act. Said direction is found categorically recorded in order dated 09.08.2023.
16. As already admitted by learned counsel for the petitioner, there is delay in filing the written statement and the written statement was filed on 121st day, i.e., beyond the prescribed outer limit of 120 days. Moreover, even the delay was sought to be condoned on general and unsubstantiated assertions and no document of any nature whatsoever was annexed with the application seeking condonation of delay in order to at least corroborate the facts mentioned in the application. I would also like to supplement here that if proper interpretation is given to the statutory provision contained under Order VIII Rule1, any defendant cannot claim period of 120 days as matter of right. The initial period is 30 days from date of service and it is only when he fails to do so, the court may allow him further period of 90 days, for reasons to be recorded in writing. Thus, the court can even decline such further enlargement of 90 days, in case no justifiable reason exists.
17. Be that as it may, this Court cannot be oblivious of the fact that the scope of judicial review in the present petition is very limited as while entertaining any petition under Article 227 of the Constitution of India, the court does not act as if it is hearing an appeal. This provision is meant for superintendence and the court is only required to examine whether the authority which has passed the impugned order has, in doing so, exposed itself to supervisory correction or not. In view of the factual position discussed above and the settled legal position, there is no irregularity or error of any kind in the impugned order.
18. Consequently, I do not find any merit and substance in the present petition and the same is, accordingly, dismissed.
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MANOJ JAIN, J

JULY 2, 2024/sw/st

CM(M) 2824/2024 Page 1 of 6