[Cites 7, Cited by 0]
Calcutta High Court
Mihijam Vanaspati Limited And Anr vs Shining Vyapar Private Limited And Ors on 31 March, 2026
Author: Debangsu Basak
Bench: Debangsu Basak
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OCD-1 WT 2
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE DIVISION
COMMERCIAL DIVISION
ORIGINAL SIDE
AD-COM/3/2025
WITH
CS-COM/788/2024
IA NO: GA-COM/1/2026
MIHIJAM VANASPATI LIMITED AND ANR
VS
SHINING VYAPAR PRIVATE LIMITED AND ORS
WITH
OCOT/2/2026
MIHIJAM VANASPATI LTD AND ANR
VS
SHINNING VYAPAR PRIVATE LIMITED AND OTHERS
BEFORE:
The Hon'ble JUSTICE DEBANGSU BASAK
-AND-
The Hon'ble JUSTICE MD. SHABBAR RASHIDI
For the Appellants : Mr. Satadeep Bhattacharyya, Adv.
Mr. Bipin Ghosh, Adv.
Ms. Sriparna Mitra, Adv.
For the Respondent
No. 1 and 2 : Mr. Rishad Medora, Adv.
Mr. Rohit Banerjee, Adv.
Ms. Kanchan Jaju, Adv.
Ms. Sreha Das, Adv.
For the Respondent
No. 3 : Mr. K. C. Garg, Adv.
Ms. Sunita Agarwal, Adv.
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HEARD ON : 31.03.2026
DELIVERED ON : 31.03.2026
DEBANGSU BASAK, J.:-
1. GA-COM/1/2026 is an application for condonation of delay in
filing the cross-objection. For the ends of justice, the causes are
accepted as sufficient and delay in filing the cross-objection is
condoned. GA-COM/1/2026 is allowed.
2. The appeal and the cross-objection are taken up for hearing
analogously as they emanate out of the same impugned judgment
and decree dated July 7, 2025 passed in CS-COM/788/2024( Old
No.CS/332/2012).
3. Learned advocate appearing for the appellant submits that, the
appellant filed a suit for declaration and injunction. The
declaration that the appellant sought for in the suit was that,
appellant was not liable to repay the defendants in the suit.
4. Learned advocate appearing for the appellant submits that,
defendant no.1 in the suit, filed a petition for winding up, being CP
No.306 of 2012. Such winding up petition was admitted by an
order dated January 22, 2013. Appeal carried therefrom, was
disposed of by an order dated April 19, 2013. He submits that,
before the Appeal Court, the appellant deposited a sum of Rs.13
lakhs as security.
5. Learned advocate appearing for the appellant submits that, a
Special Leave Petition was carried against the order of the Appeal
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Court dated April 19, 2013. Such Special Leave Petition was
disposed of by an order dated September 13, 2013.
6. Referring to the order of the Supreme Court dated September 13,
2013, learned advocate appearing for the appellant submits that, a
compromise was entered into between the appellant and the
defendant no.1 in the suit. In fact, plight of the other defendants
in the suit were also taken into consideration before the Hon'ble
Supreme Court.
7. Referring to the contents of the order dated September 13, 2013,
learned Advocate appearing for the appellant submits that, out of
the sum of Rs.13 lakhs which was lying in deposit as security in
the winding up petition, a sum of Rs.10 lakhs was directed to be
adjusted towards the claim of the defendant no.1 as against
appellant. The balance sum of Rs.3 lakhs was directed to be
refunded to the appellant.
8. Learned advocate appearing for the appellant contends that the
order dated September 13, 2013 is a complete compromise of all
disputes between the appellant and the other parties to the suit.
He contends that, subsequent to the order dated September 13,
2013, although the written statement of the defendant no.1 was
already on record the defendant no.1 proceeded to amend such
written statement by incorporating counterclaim. He refers to the
pleadings of the counterclaim. He submits that the defendant
no.1 sought to raise counterclaim on the strength of the order
dated September 13, 2013 passed by the Supreme Court.
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9. Learned advocate appearing for the appellant submits that, the
claim of the rival parties to the suit stood adjudicated upon by the
order dated September 13, 2013. In any event, by reason of the
principles enunciated in Order 23 Rule 1(4) of the Code of Civil
Procedure, 1908, the defendant no.1 is deemed to gave up its right
of counterclaim as on September 13, 2013, assuming that the
defendant no.1 was entitled to any counterclaim at that point of
time. No new event occurred subsequent to September 13, 2013
for the defendant no.1 to make a counterclaim as against the
appellant in the pending suit.
10. Learned advocate appearing for the appellant submits that, the
learned Trial Judge, therefore, erred in allowing a portion of the
counterclaim. He contends that, the suit was required to be
dismissed as against all the defendants without the counterclaim
being allowed.
11. Learned advocate appearing for the defendant no.1 submits that,
the order of the Hon'ble Supreme Court dated September 13, 2013
is required to be construed in the correct perspective. He refers to
such order and submits that, such order cannot be construed to
mean that a full and final settlement was arrived at between the
parties to the suit. He submits that, the order uses words such as
"settlement for the time being" and leaves the parties to the suit to
their remedies in the suit. That would mean that the counterclaim
of the respondent no.1 was kept open.
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12. Learned advocate appearing for the respondent no.1 submits that,
the counterclaim was introduced by way of amendment to the
written statement which was granted by the learned Trial Judge.
No grievance was raised as against the counterclaim being made.
13. Learned advocate appearing for the respondent no.1 refers to
Order XXI Rule 1(4) of the Code of Civil Procedure, 1908 and
submits that, the respondent no.1 did not abandon any part or
portion of its claim. He submits that the entire transaction was for
a sum of Rs.15 lakhs. Out of the sum of Rs.15 lakhs, Rs.2 lakhs
was received by the respondent no.1 leaving a sum of Rs.13 lakhs
to be receivable. He submits that, the rate of interest was
admitted and acknowledged by the appellant. He refers to various
pleadings of the appellant in this regard.
14. Learned advocate appearing for the respondent no.1 relies upon
(1999) 3 SCC 80 (INDUSTRIAL CREDIT & DEVELOPMENT
SYNDICATE NOW CALLED I.C.D.S LTD. VS. SMITHABEN H.
PATEL (SMT) AND OTHERS) and (2014) 5 SCC 577 (V. KALA
BHARATHI AND OTHERS VS. ORIENTAL INSURANCE
COMPANY LIMITED, BRANCH CHITOOR) and contends that,
respondent no.l is entitled to adjust the sum received from the
appellant, towards the interest amount accrued and thereafter,
towards the principal.
15. Relying upon (1992) 3 SCC 576 (JIVENDRA NATH KAUL VS.
COLLECTOR/DISTRICT MAGISTRATE AND ANOTHER), learned
advocate appearing for the respondent no.1 submits that, the
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words "for the time being" means that the same is for the time at
which, the order dated September 13, 2013 was passed and not
for the period subsequent thereto.
16. Learned Advocate appearing for the defendant no. 3 submits that,
the defendant no. 3 was involved in the suit unnecessarily.
Defendant no. 3 incurred costs and expenses in defending the suit.
He submits that, the cost of litigation awarded by the learned Trial
Judge should be increased.
17. Admittedly, a money transaction took place between the appellant
and the respondent no. 1. Respondent no. 1 lent and advanced a
sum of Rs.15 lakhs to the appellant which was repayable by the
appellant along with agreed rate of interest.
18. With the appellant not repaying such loan, respondent no. 1 filed a
winding-up petition as against the appellant being CP No. 306 of
2012. Such winding-up petition was admitted by an order dated
January 22, 2013 on the basis of the admission of the appellant
that, the respondent no. 1 granted a loan of Rs.15 lakhs and that,
the appellant agreed to pay interest at the rate of 12% per annum
on such sum. The admission of the parties that, Rs.2 lakhs was
repaid by the appellant was also placed on record.
19. It is admitted at the Bar that, out of the sum of Rs.15 lakhs, lent
and advanced by the respondent no. 1 to the appellant, a sum of
Rs.2 lakhs was repaid by the appellant to the respondent no. 1
leaving a sum of Rs.13 lakhs due and payable along with accrued
interest.
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20. An appeal was carried against the order dated January 22, 2013
passed in CP No. 306 of 2012 being APO/120/2013. Such appeal
was dismissed by an order dated April 19, 2013. In the appeal, a
sum of Rs.13 lakhs was deposited by the appellant.
21. A special leave petition was preferred against the order dated April
19, 2013 passed in APO/120/2013. Such special leave petition
was disposed of by an order dated September 13, 2013. It would
be apposite to set out the relevant portions of the order dated
September 13, 2013 which are as follows;
"3. We are happy to note that in the course of
hearing of this appeal, the parties to the litigation
have amicably resolved their dispute for the time
being and therefore, the appeal is being
disposed of with certain directions.
7. It has been agreed among the parties and
therefore, we direct that out of the said amount
of Rs.13 lacs deposited with the Calcutta High
Court, the respondent is permitted to withdraw
Rs.10 lacs and the remaining amount of Rs.3
lacs shall be returned to the appellant. The
winding up proceedings shall be dropped or
permitted to be withdrawn and the hearing of
Civil Suit No. 332 of 2012 filed by the appellant
along with its sister concern against the
respondent and others, before the Calcutta High
Court shall be expedited.
8. The learned counsel appearing for both the
parties have assured this Court that the litigants
and the counsel appearing in the aforestated
civil suit shall extend their cooperation to the
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High Court so that the aforestated suit can be
disposed of at an early date.
9. In view of the above order, the order dated
19th April, 2013 passed in APO No. 120 of 2013
in CP No. 306 of 2012 and order passed in
winding up Petition No. 306 of 2012 dated 22nd
January, 2013 are quashed and set aside. The
appeal is disposed of accordingly without any
order as to costs."
22. During the pendency of the winding-up proceedings, the appellant
as a plaintiff, filed a suit for declaration and injunction. In such
suit, the defendant no. 1 filed a written statement. In such written
statement, defendant no. 1 did not make any counterclaim till
prior to September 13, 2013.
23. Subsequent to the order dated September 13, 2013 of the Hon'ble
Supreme Court, respondent no. 1 filed a written statement making
further claims as against the appellant.
24. Pursuant to and in terms of the order dated September 13, 2013,
respondent no. 1 received a sum of Rs.10 lakhs out of the sum of
Rs.13 lakhs kept in deposit to the credit of the winding-up
petition. Court is informed that the appellant is yet to withdraw
the sum of Rs.3 lakhs.
25. At the time, when, the parties before the Hon'ble Supreme Court
were entering into the agreement as was recorded in the order
dated September 13, 2013, the parties were well aware as to their
respective liabilities and obligations vis-a-vis each other.
Respondent no. 1 agreed to receive a sum of Rs.10 lakhs.
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Respondent no. 1 agreed that out of the sum of Rs.13 lakhs kept
in deposit the balance Rs.3 lakhs will be returned to the appellant.
26. In our view, before the Hon'ble Supreme Court, parties entered
into and settled their disputes against each other finally. Hon'ble
Supreme Court was made aware of the pending suit and since, the
special leave petition emanated out of the winding-up proceedings,
Hon'ble Supreme Court permitted the parties to expedite the
hearing of the suit. Hon'ble Supreme Court also directed the
parties to extend their cooperation so that the suit can be disposed
of at an early date.
27. It is the contention of the respondent no. 1 that, the dispute for
the time being was settled before the Hon'ble Supreme Court
meant that the respondent no. 1 can make the counter claim. In
Jivendra Nath Kaul (supra), the provisions of Section 28 (11) of
the U.P. Kshettra Samitis and Zilla Parishads Adhiniyam, 1961 fell
for consideration. The words used "for the time being", in such
Statute was construed to mean that at the moment or the existing
position. It also held that, such words indicate the actual
membership in existence on the date of the motion of no
confidence.
28. Applying such interpretation to the case at hand therefore, on the
date, when the order dated September 13, 2013 was passed, the
parties were settling all disputes between them as on September
13, 2013. No material was placed either before the learned Trial
Judge or before us to suggest let alone establish that, there was
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any event occurring subsequent to September 13, 2013 for the
respondent no. 1 to introduce the counterclaim.
29. In our view, the order dated September 13, 2013, set at rest all
disputes between the parties as on that date. Disputes prior to
such date cannot and should not be permitted to be reopened.
Learned Trial Judge erred in doing so.
30. Smithaben H. Patel (supra) and V. Kala Bharathi (supra) notices
the provisions of order XXI Rule 1(4) of the Code of Civil Procedure,
1908 amongst others and is of the view that, adjustment of
interest is to be made first awards the interest accrued and
thereafter towards the principal. Smithaben H. Patel (supra) in
addition thereto also notices the provisions of Sections 59 to 61 of
the Contract Act, 1872.
31. In the facts and circumstances of the present case, since, the
disputes between the parties stood settled as on September 13,
2013 and since, there was no further cause of action for the
respondent no. 1 to introduce the counterclaim as done, the
question of award of any amount in favour of the respondent no. 1
by the learned Trial Judge does not arise. Therefore, the question
of adjustment of amount received also does not arise. Apart
therefrom as on September 13, 2013, the respondent no. 1
accepted a sum of Rs.10 lakhs from the appellant.
32. In such circumstances, the appeal of the appellant is disposed of
by setting aside the portion of the impugned judgment and order
quantifying the amount of principal and the interest payable by
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the appellant to the respondent no. 1. However, the portion of the
order, which directs the payment of litigation costs to the
defendant no. 3 is retained. Such retention is made since, no
ground with regard thereto was canvassed in the appeal by the
appellant.
33. On the parity of the same reasoning as noted above, the cross-
objection filed by the respondent no. 1 in the appeal, is dismissed.
No order as to costs in both the proceedings.
34. Appellant seeks refund of the sums lying with the Registrar,
Original Side in the present appeal as also in the winding-up
proceedings.
35. Since, we are of the view that, the parties settled their disputes
before the Hon'ble Supreme Court as noted above, it would be
appropriate to direct the Registrar, Original Side to refund the
sums lying with it to the credit to the winding-up proceedings as
also to the appeal, along with accrued interest therein, to the
appellant no. 1, subject to deduction of all legitimate cost and
charges therefrom.
36. Learned Advocate appearing for the appellant at this stage,
submits that, a sum of Rs.50,000/- as awarded by the decree may
be made over by the Registrar to the respondent no. 3 in full and
final satisfaction of the decretal amount in terms of the impugned
judgment and decree. Such request being reasonable, is accepted.
37. Learned Registrar, Original Side is requested to make over a sum
of Rs.50,000/- out of the proceeds of the sum lying with the credit
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to the appeal to the respondent no. 3, towards full and final
satisfaction of the decretal amount, within a period of four weeks
from date.
38. AD-COM/3/2025 and OCOT/2/2026 are disposed of accordingly.
(DEBANGSU BASAK, J.)
39. I agree.
(MD. SHABBAR RASHIDI, J.)
KB/B. Pal
AR(CR)
