* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Judgment: 05.03.2012
+ C.R.P. 505/2004 & CM No. 5560/2010
THAI AIRWAYS INTERNATIONAL PUB. CO. LTD. ..... Petitioner
Through Mr.Sanjay Gupta, Adv.
versus
L.M.KHOSLA & ORS. ..... Respondent
Through Mr. J.K. Sharma, Adv.
CORAM:
HON'BLE MS. JUSTICE INDERMEET KAUR
INDERMEET KAUR, J. (Oral)
1. Order impugned is the order dated 16.09.2004; application filed by the defendant under Order 7 Rule 11 of Civil Procedure (hereinafter referred to as the „Code‟) had been dismissed. The averments in the application under Order 7 Rule 11 of the Code were that the defendant (M/s Thai Airways International Pub. Co.) is a "sovereign state" within the meaning of Section 86 of the Code and without the mandate of the said provision having been complied with and the consent of the Central Government not having been obtained, the present suit filed by the plaintiff was not maintainable.
CRP No.505/2004 Page 1 of 5
2. Record shows that a suit for declaration and injunction had been filed by the seven plaintiffs; contention of plaintiff No. 1 was that he is an ex-employee of defendant No. 1; he and his family members even after their retirement were entitled to certain free passages of defendant No. 1; accordingly a decree for declaration and perpetual injunction had been sought.
3. In the course of the proceedings, the present application under Order 7 Rule 11 of the Code had been filed; the grievance of the defendant being that the bar of Section 86 of the Code is operational and unless and until the consent of the Central Government is obtained, the present suit could not have been filed. The impugned order had rejected this prayer.
4. This controversy has now rested with the judgment of the Apex Court in Ethiopian Airlines Vs. Ganesh Narain Saboo in Civil Appeal No. 7037/2004 decided on 09.08.2011. In this case, the question which had come up for decision before the Apex Court was as to whether proceedings before the Consumer Forum are "suits" and whether the embargo of Section 86 of the Code would operate under the Consumer Forum Act. This question was answered in the negative; the Court was CRP No.505/2004 Page 2 of 5 of the view that the proceedings before the consumer forum do not come within the sweep of the term „suit‟.
5. The Apex Court in the case of Ethiopian Airlines (supra) had reiterated the observations of its earlier decision in the case of State of Karnataka Vs. Vishwabharathi House Building Co-operative Society and Others (2003) 2 SCC 412. While rejecting the plea sovereign immunity of Ethiopian Airlines qua commercial transactions, the Apex Court in the case had also noted:-
"70. Ethiopian Airlines is not entitled to sovereign immunity with respect to a commercial transaction is also consonant with the holdings of other countries' courts and with the growing International Law principle of restrictive immunity. For instance, in England, in Rahimtoola v. H.E.H. The Nizam of Hyderabad and Ors. (1957) 3 All E.R. 441, Lord Denning found that "there was No. reason why [a country] should grant to the departments or agencies of foreign governments an immunity which [the country does] not grant [its] own, provided always that the matter in dispute arises within the jurisdiction of [the country's] courts and is properly cognizable by them." Lord Denning also held that "if the dispute concerns... the commercial transactions of a foreign government... and it arises properly within the territorial jurisdiction of [a country's] courts, there is No. ground for granting immunity," finding implicitly that it would not "offend the dignity of a foreign sovereign to have the merits of such a dispute canvassed in the domestic courts of another country."
CRP No.505/2004 Page 3 of 5 ..............................In the modern era, where there is close interconnection between different countries as far as trade, commerce and business are concerned, the principle of sovereign immunity can no longer be absolute in the way that it much earlier was. Countries who participate in trade, commerce and business with different countries ought to be subjected to normal rules of the market. If State owned entities would be able to operate with impunity, the rule of law would be degraded and international trade, commerce and business will come to a grinding halt. Therefore, we have no hesitation in coming to the conclusion that the Appellant cannot claim sovereign immunity. The preliminary objection raised by the Appellant before the court is devoid of any merit and must be rejected."
6. The Apex Court had noted that Ethiopian Airlines must be held accountable for its contractual and commercial activities and obligations that it undertakes in India.
7. Applying the ratio of the aforenoted judgment, it is clear from the averments made in the plaint that this was contractual transaction entered into between the plaintiff and the defendant; hurdle/embargo of Section 86 of the Code is clearly not applicable. Even on facts plaintiff has filed a certificate alleging to be owner of 400 shares of the defendant company; it having become a public limited company.
8. It is also an undisputed position that for dealing with the application under Order 7 Rule 11 of the Code, it is only the averments which are made in the plaint which have to be looked into and not the CRP No.505/2004 Page 4 of 5 defences sought to be set up by the defendant.
9. Be that as it may, the impugned order in no manner suffers from any infirmity. This petition is clearly an abuse of the process of the Court. It has been pending before this Court since the year 2004; even today inspite of ratio of the judgment of Ethiopian Airlines having been pointed out to the learned counsel for the petitioner, he has made every effort to distinguish the said judgment but he has failed to do so. Petition being an abuse of the process of the Court is dismissed with costs of Rs.10,000/- to be deposited with Delhi High Court Legal Services Committee.
INDERMEET KAUR, J MARCH 05, 2012 A CRP No.505/2004 Page 5 of 5