Calcutta High Court (Appellete Side)
M/S. Tata Steel Bsl Limited vs M/S. Mala Roy And Others on 14 June, 2022
04 14.06. IN THE HIGH COURT AT CALCUTTA
2022 Civil Appellate Jurisdiction
(Commercial Division).
Ct. No. 37
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Ab
FA 100 of 2022
With
IA No. CAN 1 of 2021
IA No. CAN 2 of 2022
M/s. Tata Steel BSL Limited
Vs.
M/s. Mala Roy and others.
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Mr. Probal Kumar Mukherjee,
Mr. Bhaskar Mukherjee,
Ms. Debjani Ghosh,
Ms. Nafisa Yasmin.
... for the appellant.
Mr. Debdut Mukherjee,
Mr. Dibesh Dwivedi,
Mr. R. Agarwal,
Mr. Vidhya Upadhyay.
... for the respondents.
Re: CAN 2 of 2022
This is an application for substitution of the name
of the appellant necessitated by an order of
amalgamation.
After perusing the averments made in the instant
application, we do not find any grounds for rejection
thereof and, accordingly, the same is allowed.
Let the necessary amendment in the cause title be
made by the department immediately.
After hearing the parties and considering the points
involved in the instant appeal, we find that it would be
simply burdening the docket of the Court in keeping the
appeal alive and the consideration is restricted on an
application filed by the plaintiff/appellant. We,
therefore, decided to hear out the appeal without
observing the procedural formalities required therefor
and invited the respective Counsels to address us on the
merit of the said appeal.
This appeal arises from the judgment and order
dated 23rd August 2021 passed by the Commercial
Court at Alipore in Money Suit No. 9 of 2020 by which
an application under Order VII Rule 11 of the Code of
Civil Procedure filed by the defendants/respondents was
allowed.
The little prelude to the genesis of the dispute is
required to be adumbrated.
The plaintiff/appellant is a Company known for
manufacturing and marketing of steel strips and sheets,
precision, tubes, pipes billets etc. and required the iron
ores fines and sized from the intending supplier. The
defendants/respondents carrying out the mining
business approached the plaintiff for supply of the
goods as required by the plaintiff from the mines
situated at Jalahuri Iron & Manganese Mines in village
Khandbandh under Champua Sub-Division of Keonjhar
District - Odisha. It was represented to the plaintiff that
the defendants/respondents have long-term mining
lease and have acquired substantial goodwill and
reputation in the market. Pursuant to the same, a
purchase order was issued on 21st February, 2013 for
supply of 6 rakes of iron ore on the agreed terms and
conditions. After the supply of the first rake of the sized
iron ore on 8th March, 2013, an additional sum of
Rs.66,00,000/- was demanded against the purchase
order, but that was not accepted by the
plaintiff/appellant. Subsequently second rake was
released on 1st April, 2013 but thereafter the
defendants/respondents unilaterally cancelled the
agreement and did not intend to supply the third rake of
iron ore.
The plaint proceeds that since the lease was due to
expire in the near future, the defendants/respondents
were facing difficulty in supplying the iron ore, but later
on an agreement was made that they will honour the
indent on or before the expiry of the said mining lease. It
is stated in the plaint that the divulged amount as an
advance has been given to the defendants/respondents
to secure the supply of goods and ultimately they did
not supply the goods as contemplated in the purchase
order and thereafter a demand was made for refund of
the money lying in excess with the
defendants/respondents. It is averred in the plaint that
several discussions and communications were made
between the parties and ultimately an e-mail was
forwarded to the plaintiff/appellant by the
defendants/repondents containing the reconciled
amount but did not indicate therein further refund of
Rs.10,00,000/- made on 1st November, 2017. It is
further averred in the plaint that by virtue of
acknowledgement having made through e-mail, the
period of limitation is extended and the partial
payments were made, which is also to be taken into
account for the purpose of period of limitation.
In the cause of action paragraph it is indicated
though cause of action initially arose on the date of
cancellation of the purchase order but the period of
limitation was subsequently extended from time to time
on the basis of the unequivocal admission made verbally
or through documents and the suit is within the period
of limitation as the period for limitation for filing the suit
expires during the pandemic and in view of the Suo
Motu Writ Petition (Civil) no. 3 of 2020 the Supreme
Court was pleased to extend the period of limitation for
filing of the suit.
In the backdrop of the aforesaid facts having
pleaded in the plaint, an application under Order VII
Rule 11 of the Code was taken out by the
defendants/respondents alleging that the suit is
palpably barred by limitation. A shelter appears to have
been taken on the cause of action paragraph pleaded in
the plaint and the fact that the acknowledgement was
made beyond the expired period of limitation, therefore,
no protection can be extended under Section 18 of the
Limitation Act.
The Commercial Court proceeded to allow the
application under Order VII Rule 11 of the Code holding
that the suit is palpably barred by limitation on the
basis of the fact that the cause of action for filing a suit
for recovery of money accrued in the year 2013 and no
credence could be given to the e-mail dated 23rd July,
2016 even if the same is construed as an
acknowledgement to the dues but beyond the expired
period of limitation.
Mr. Probal Kumar Mukherjee, learned Senior
Advocate appearing on behalf of the appellant, submits
that the meaningful reading of the plaint would evince
that not only the acknowledgement to the dues have
been made by the defendants/respondents but in fact
refund of the excess amount was made from time to
time until 1st November, 2017 and, therefore, the Trial
Court has wrongly held that the acknowledgement was
beyond the period of limitation. It is further submitted
that Section 19 of the Limitation Act was not pressed in
action before the Trial Court where the part payment of
the debt constitutes fresh cause of action and, therefore,
the Trial Court ought to have held that the suit is within
the period of limitation. Lastly, it is submitted that the
moment it is found from the averments made in the
plaint that the limitation assumes character of mixed
questions of fact and law, the Court ought to have
dismissed the application filed under Order VII Rule
11(d) of the Code.
On the other hand, learned Advocate for the
respondents submits that there is no sufficient
pleadings made in the said plaint indicating the
payments having made on divulged dates by the
defendants/respondents and in absence of any specific
averments, the Trial Court cannot look into the other
aspects. It is further submitted that the
acknowledgement must be made before the expiration of
the period of limitation and admittedly the e-mail was
beyond the period of limitation. It would not safe nor
would constitute an accrual of fresh cause of action
under Section 18 of the Limitation Act.
On the conspectus of the aforesaid contentions
raised before us the only point which boiled down is
whether the Trial Court was justified in rejecting the
plaint under Order VII Rule 11 of the Code solely on the
ground of limitation.
It admits no ambiguity that at the stage of Order VII
Rule 11(d) of the Code the Court has to restrict its
scrutiny on the peripheral of the plaint and should not
consider the defence taken by the
defendants/respondents or a new case made out in an
application for rejection of the plaint. It admits no
ambiguity that in order to avail the provisions contained
under Order VII Rule 11(d) of the Code the
defendants/respondents have to accept the statements
made in the plaint to be true, correct and sacrosanct
and thereafter have to demonstrate before the Court
that the suit is barred by law.
We have succinctly jotted down the case made out
in the plaint herein before and we have no hesitation to
say that the suit was filed for recovery of the excess
amount paid to the defendants/respondents to secure
the supply of iron ore; in other words, the price of the
goods to be supplied was paid in advance and the
money was sought to be refunded as the
defendants/respondents unilaterally cancelled the
contract. The purchase order was issued as far back as
on 21st February 2013 for supply of 6 rakes of the iron
ore.
It is not in dispute that the
defendants/respondents could not supply the entire
quantity of the goods but supplied 2 rakes and
ultimately cancelled the third one. The
plaintiff/appellant further observed that the excess
money is lying with the defendants/respondents and if
they intend to cancel the purchase order, they are liable
to make refund.
It would discern from the plaint that several
discussions were made in this regard and the
defendants/respondents were supposed to pay back the
said amount and ultimately on 22nd March 2017, the
defendants/respondents through e-mail supplied its
own ledger account on the request of the
plaintiff/appellant and admitted the credit to the tune of
Rs.1,66,07,341/- as due and payable to the
plaintiff/appellant.
Though it is stated that the accounts as submitted
by the defendants/respondents would reveal that the
payments were made yet there was no particular
pleading in this regard. But, it appears from the plaint
that such document was annexed thereto and forms
part thereof. The plaintiff/appellant alleged that the last
payment was made by the defendants/respondents on
1st November 2017, which is conspicuously absent in
the reconciled account. Such being the facts emanates
from the plaint, we failed to understand why Section 18
or 19 would not come into play for the purpose of
approval of the cause of action or the extension thereof.
The reconciled documents annexed to the plaint would
reveal that the refund was made on divulged dates and
the last payment shown therein was made on 2nd
November 2016 to the tune of Rs.5,00,000/-. If such
being the position then the period of limitation under
Section 19 of the Limitation Act would reckon from 2nd
November 2016 and would expire sometimes in the
month of November 2019.
It is alleged in the plaint that further refund was
made on 1st November 2017, which is required to be
proved by way of evidence. If the fresh period of
limitation is to be reckoned from the said date then the
period of limitation expires during the pandemic time
and in view of the judgment of the Supreme Court in
Suo Motu Writ Petition the same was extended from
time to time and the plaint filed within such extended
period cannot be thrown to have been filed beyond the
period of limitation.
We are not unmindful of the proposition of law that
the plea of limitation is essentially a mixed questions of
fact and law unless it is apparent from the averments
made in the plaint and the documents annexed thereto.
The moment the Court finds that such pleading of
limitation is required to be proved by evidence, oral and
documentary, the provision under Order VII Rule 11(d)
of the Code does not contemplate the rejection of the
plaint.
We find that the manner in which the case has
been made out and upon meaningful reading of the
pleadings made in the plaint, the limitation assumes
character of mixed questions of fact and law and,
therefore, we do not find that the judgment of the Trial
Court is legal, proper and does not require any
interference.
Accordingly, the impugned order is set aside and
the plaint is readmitted to file.
The Trial Court is directed to proceed with the case.
It goes without saying that the observations made
herein above are restricted to an application under
Order VII Rule 11 of the Code and shall not have any
persuasive effect at the time of deciding the suit on
merit upon full-fledged trial.
With these observations, the appeal is disposed of.
In view of the disposal of appeal itself, the
connected application being CAN 1 of 2021 has become
infructuous and the same is also disposed of.
(Harish Tandon, J.)
(Shampa Dutt (Paul), J.)
