Delhi High Court
Arindam Chaudhuri vs Zest Systems Pvt Ltd & Anr on 10 September, 2021
$~1, 2 & 6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ FAO(OS) 23/2020&CM APPL. 7970-7972/2020
Date of Decision :10.09.2021
ODEON BUILDERS PVT LTD ..... Appellant
Through: Mr. Karunesh Tandon, Ms. Simran
Mulchandani& Mr. Manish Kumar,
Advs.
versus
NBCC (INDIA) LTD ..... Respondent
Through: Ms. Shilpi Chowdhary and
Mr.Jasdeep Singh Dhillon, Advs.
+ FAO(OS) (COMM) 19/2020, CM APPL. 2788/2020 & CM APPL.
7262/2021
M/S RAYBAN FOODS PVT LTD ..... Appellant
Through: Mr. Sunil Dalal, Sr. Adv. with
Mr.Vivek Jain, Mr.Devashish
Bhadauria and Ms. Surbhi Mehta,
Advs.
versus
M/S GAC LOGISTICS PVT LTD ..... Respondent
Through: Mr.Sanjana Saddy, Mr .Sanyat Lodha
and Ms. Harshita Singhal, Advs.
+ FAO(OS) (COMM) 16/2020, CM APPL. 2235/2020&CM APPL.
2237/2020
ARINDAM CHAUDHURI ..... Appellant
Through: Mr. NishitKush, Advocate.
versus
ZEST SYSTEMS PVT LTD & ANR ..... Respondents
Through: Mr. Kirti Uppal Sr. Adv. with Mr. N
K Kanatawla and Mr.Satyender
Chahar, Advs.
Signature Not Verified
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By:AMIT ARORA FAO(OS) 23/2020 ,FAO(OS) (COMM) 19/2020& FAO(OS) (COMM) 16/2020 Page 1 of 13
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CORAM:
HON'BLE MR. JUSTICE VIPIN SANGHI
HON'BLE MR. JUSTICE JASMEET SINGH
JUDGMENT
% VIPIN SANGHI, J (ORAL)
1) In respect of Item 1, the Registry is directed to register the appeal as
FAO (OS)(COMM) No. 23/2020 instead of FAO(OS) No. 23/2020.
2) These three commercial appeals have been preferred under Section 13
of the Commercial Courts, Commercial Division and Commercial Appellate
Division of the High Courts Act, 2015 (Commercial Courts Act) to assail the
orders passed in the respective commercial causes by the learned Single
Judge. The particulars of the impugned orders passed in these three appeals
are as follows:
(I) FAO(OS)(COMM) No. 23/2020
The impugned order is dated 31.10.2019 passed by learned
Single Judge in O.A. No. 81/2019 [CS(COMM) No.
1261/2018]. By the impugned order, the learned Single Judge
dismissed the Chamber Appeal against the order passed by the
Joint Registrar, whereby the right of the plaintiff to file the
replication as well as affidavit of admission/ denial of
documents was closed.
(II) FAO(OS)(COMM) No. 17/2020
The impugned order is dated 06.12.2019 passed by learned
Single Judge in CS(COMM) No. 1143/2018. By the impugned
order, the learned Single Judge rejected three issues proposed by
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the defendant, including an issue on limitation. The appeal is
preferred only qua the disallowance of the issue on limitation.
(III) FAO(OS)(COMM) No. 17/2020
The impugned order is dated 01.10.2019 passed by learned
Single Judge in I.A. 7379/2019[CS(COMM) No. 513/2017]. By
the impugned order, the learned Single Judge allowed the
application for amendment of the plaint.
3) Section 13 of the Commercial Courts Act, which creates the Right of
Appeal reads as follows:
"13. Appeals from decrees of Commercial Courts and
Commercial Divisions.--(1) 1 [Any person aggrieved by the
judgment or order of a Commercial Court below the level of a
District Judge may appeal to the Commercial Appellate Court
within a period of sixty days from the date of judgment or
order.
(1A) Any person aggrieved by the judgment or order of a
Commercial Court at the level of District Judge exercising
original civil jurisdiction or, as the case may be, Commercial
Division of a High Court may appeal to the Commercial
Appellate Division of that High Court within a period of sixty
days from the date of the judgment or order:
Provided that an appeal shall lie from such orders passed by
a Commercial Division or a Commercial Court that are
specifically enumerated under Order XLIII of the Code of
Civil Procedure, 1908 (5 of 1908) as amended by this Act and
section 37 of the Arbitration and Conciliation Act, 1996 (26 of
1996).]
(2) Notwithstanding anything contained in any other law for
the time being in force or Letters Patent of a High Court, no
appeal shall lie from any order or decree of a Commercial
Division or Commercial Court otherwise than in accordance
with the provisions of this Act." (emphasis supplied)
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4) In light of the provision contained in Section 13 of the Commercial
Courts Act, since none of the impugned orders are specifically appealable
under Order 43 CPC, we had required the parties to address us on the aspect
of maintainability of the present appeals.
5) Learned counsels for the appellants placed reliance on a Division
Bench judgement of this Court in D & H India Ltd. vs Superon
Schweisstechnik India Ltd. [FAO(OS)(COMM) No. 237/2019] decided on
16.03.2020. The Division Bench in its decision, inter alia, in Para 21 held
as follows:
"21. On a plain reading, the proviso to Section 13 (1A) of the
Commercial Courts Act is an enabling, rather than a disabling,
provision. There is nothing, in the said proviso, which would
seem to indicate that it dilutes the effect of sub-section (1A)
of Section 13. If we were to read the said proviso as excluding,
from the jurisdiction of the appellate court, all orders, passed
by a Commercial Court, save and except those which find
specific enumeration in Order XLIII of the CPC, it may amount
to rewriting the proviso to read "Provided that no appeal shall
lie, except from such orders passed by a Commercial Division
or the Commercial Court as are specifically enumerated under
Order XLIII of the Code of Civil Procedure, 1908 (5 of 1908)
as amended by this Act and section 37 of the Arbitration
and Conciliation Act, 1996 (26 of 1996)." We are not convinced
that the province of our jurisdiction, in the present case, allows
us to so legislate. To our mind, therefore, sub-section (1A) of
Section 13 of the Commercial Courts Act allows appeals to be
preferred against all judgements and orders of the Commercial
Division of the High Court, to the Commercial Appellate
Division thereof, and the proviso, to the said sub-section merely
clarifies that, in the case of orders specifically enumerated in
Order XLIII of the CPC, such appeals shall lie."
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6) Thereafter, the Division Bench in its conclusions in Para 45 held as
follows:
"45. We are, therefore, not persuaded to accept the preliminary
objection, of Mr. Sindhwani, regarding the maintainability of
the present appeal before us. For the sake of clarity, we
reiterate our reasons, thus:
(i) OA 58/2019 was filed in CS (COMM) 665/2017. The
learned Single Judge was, therefore, exercising
jurisdiction under the Commercial Division of this
Court. Section 13 of the Commercial Courts Act
would, therefore, apply. On this aspect, we may note,
Mr. Sindhwani, too, is ad idem.
(ii) Sub-section (1A) of Section 13 of the Commercial
Courts Act allows any person, aggrieved by the
judgement or order of the Commercial Division of
the High Court, to appeal to the Commercial
Appellate Division of that High Court. Inasmuch as
the learned Single Judge was sitting in the
Commercial Division of this Court, while passing the
impugned order dated 3rd July, 2019, the said order
would be appealable to the Division Bench of this
Court, on a plain reading of Section 13(1A) of the
Commercial Courts Act.
(iii) The proviso to Section 13 (1A) cannot, in our view,
be read as limiting the right to appeal, conferred by
Section 13 (1A). The said proviso merely states that,
from orders passed by the Commercial Division of
the High Court, as are specifically enumerated under
Order XLIII of the CPC, an appeal would lie under
Section 13 (1A). In our view, the proviso cannot be
read as meaning that no appeal would lie in any
other case, especially where the order under appeal
has not been passed under the CPC at all, but under
Rule 5 in Chapter II of the 2018 Original Side Rules.
(iv) The judgements in HPL (India) Ltd1 and Samsung
Leasing Ltd2 do not apply, as they related to appeals,
against orders passed by the learned Single Judge
under one or the other provision of the CPC. In such
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circumstances, these decisions restricted the ambit of
Section 13 (1A) of the Commercial Courts Act, by
invoking Section 104 and Order XLIII of the CPC.
The case before us being relatable to an order passed
under Rule 5 in Chapter II of the 2018 Original Side
Rules, we are not persuaded to follow the decisions
in HPL (India) Ltd1 and Samsung Leasing Ltd2.
Judgements rendered by courts, it is trite, are not to
be read as analogous to Euclid‟s theorems, but have
to be understood and applied in the light of the fact-
situation, and the legal issue arising for
consideration, in those cases7.
(v) In this context, we may note that the 2018 Original
Side Rules have been notified in exercise of the
powers conferred, not only by Section 129 of the
CPC, but by Section 7 of the Delhi High Court Act.
Section 129 of the CPC permits every High Court to
make such rules, not inconsistent with the Letters
Patent, or order or other law establishing it, to
regulate its own procedure in the exercise of its
original civil jurisdiction, as it thinks fit. Section 7 of
the Delhi High Court Act stipulates that, subject to
the provisions thereof, "the High Court shall have all
such powers to make rules and others with respect to
practice and procedure as are immediately before the
appointed day exercisable by the High Court of
Punjab and shall also have powers to make rules and
orders with respect to practice and procedure for the
exercise of its ordinary original civil jurisdiction".
The Original Side Rules of this Court have, therefore,
their own individual identity, distinct and different
from the CPC, and we do not see any justification for
applying, to an order passed under Rule 5 in Chapter
II of the 2018 Original Side Rules, the restraints
contained in Section 104, or Order XLIII, of the
CPC, insofar as the availability of a remedy of
appeal, against such order, under Section 13(1A) of
the Commercial Courts Act, is concerned. We may
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note, in this regard, that, over four decades ago a
Full Bench of this Court had held, in Print Pak
Machinery Ltd. v. Jay Kay Papers Converters8, that
in the event of any conflict, the Original Side Rules
prevailed over the Civil Procedure Code, 1908.
(vi) Nor are we persuaded to non-suit the appellant, by
applying Rahul Gupta 3, which proceeds on the
premise that the use of the word "appeal", in Rule 4
in Chapter II of the 1967 Original Side Rules -
whereunder the order of the learned Single Judge
had been passed in that case - was a "misnomer".
The appeal before the Division Bench had, in that
case, been filed under Section 10 of the Delhi High
Courts Act. In our view, the said decision,
irrespective of its correctness or otherwise, would
not apply to the present case, as (a) the order
impugned before us has been passed, not under Rule
4 in Chapter II of the 1967 Original Side Rules, but
under Rule 5 in Chapter II of the 2018 Original Side
Rules which, yet again, uses the word "appeal" and
(b) the appeal, before us, lies, not under Section 10 of
the Delhi High Court Act, but under Section 13 of the
Commercial Courts Act, the range and sweep of
which is far more expansive than that of Section
10 of the Delhi High Courts Act."
7) We may observe that the Division Bench sought to distinguish earlier
decisions cited before it in the cases of Rahul Gupta Vs. Pratap Singh &
Ors. MANU/DE/4330/2013, HPL (India) Limited and Ors. Vs. QRG
Enterprises and Ors MANU/DE/0347/2017 and Samsung Leasing Ltd.
and Ors. Vs. Samsung Electronics Co. Ltd. And Ors.
MANU/DE/2107/2017, which had been relied upon by the respondent
before it, to contend that the appeal under Section 13 was not maintainable,
since the order passed by the learned Single Judge in the commercial cause
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was not specifically appealable under Order XLIII, Code of Civil Procedure.
8) We had doubts about the correctness of the view taken in D & H
India Ltd. (Supra). We felt that the said view went against the very purpose
for which the Commercial Courts Act was enacted i.e. to provide for speedy
disposal of high value commercial disputes, as is evident from the Statement
of Objections and Reasons for the said Act. The effect of judgment in D &
H India Ltd. (Supra) was that all orders passed by the Commercial Courts,
or the Commercial Division of the High Court, would be appealable when,
before the enactment of the Commercial Courts Act, only such orders were
appealable, which were either specifically made appealable, such as, under
Section 104, or within Order XLIII CPC, or qualified as "judgments" within
the meaning of that expression, as explained by the Supreme Court in Shah
Babulal Khimji V. Jayaben D. Kania & Another, AIR 1981 SC 1786.
Thus, the right to prefer an appeal - if D & H India Ltd. (Supra) were to be
accepted as the correct view, stood expanded by Section 13 of the
Commercial Court Act, when compared to the right of appeal available prior
to its enactment. We were of the prima facie view that this would go
contrary to the purpose and object of the Commercial Courts Act, as creation
of a right of appeal against all and sundry orders passed in Original
Commercial Causes would impede the progress of the causes. Every appeal
at the interlocutory stage of the proceedings acts as a speed breaker in the
progress of the cause. Moreover, if the proviso to Section 13(1A) were to be
read as not limiting or qualifying the right of appeal contained in Section
13(1) and the first part of Section 13(1A), then there was no need to enact
the proviso. The view taken in D & H India Ltd. (Supra) rendered the
proviso to Section 13(1A) a surplusage - which is not to be presumed in
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respect of any part of a legislation. Thirdly, the view taken by the Division
Bench in D & H India Ltd. (Supra) neither took into account Section 13(2),
nor the interpretation adopted by the Division Bench could be reconciled
with the clear plain meaning of Section 13(2). A party aggrieved by an order
passed at the interlocutory stage of the proceedings is not entirely
remediless, in as much, as, Section 105 CPC entitles the party aggrieved by
any such interlocutory order, to assail the same which appealing against the
decree by raising a ground in the Memorandum of Appeal. Moreover, the
option to assail the interlocutory order before the Supreme Court, by
preferring a Special Leave Petition, is also available. Since we were finding
it difficult to persuade ourselves to accept the view expressed in D & H
India Ltd. (Supra), we decided to hear the submissions of learned counsels,
and directed them to place on record copies of the judgements that they wish
to rely upon.
9) The respondents, who are opposing the maintainability of the appeals,
have placed before the Court the judgement rendered by the Supreme Court
in Kandla Export Corporation & Ors. vs OCI Corporation &Ors., (2018)
14 SCC 715, wherein the Supreme Court has interpreted Section 13 of the
Commercial Courts Act, and held as follows:
"14. Section 13(1) of the Commercial Courts Act, with which
we are immediately concerned in these appeals, is in two parts.
The main provision is, as has been correctly submitted by
ShriGiri, a provision which provides for appeals from
judgments, orders and decrees of the Commercial Division of
the High Court. To this main provision, an exception is carved
out by the proviso.
The primary purpose of a proviso is to qualify the generality of
the main part by providing an exception, which has been set
out with great felicity in CIT v. Indo-Mercantile Bank Ltd.,
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MANU/SC/0070/1959: 1959 Supp (2) SCR 256 at 266-267,
thus:
"The proper function of a proviso is that it qualifies the
generality of the main enactment by providing an exception and
taking out as it were, from the main enactment, a portion
which, but for the proviso would fall within the main enactment.
Ordinarily it is foreign to the proper function of a proviso to
read it as providing something by way of an addendum or
dealing with a subject which is foreign to the main enactment.
"It is a fundamental rule of construction that a proviso must be
considered with relation to the principal matter to which it
stands as a proviso". Therefore it is to be construed
harmoniously with the main enactment. (Per Das, C.J. in Abdul
Jabar Butt v. State of Jammu & Kashmir [MANU/SC/0017
1956: [(1957) SCR 51, 59]). Bhagwati, J., in Ram Narain Sons
Ltd. v. Assistant Commissioner of Sales Tax [MANU/SC/0084
1955:[(1955) 2 SCR 483, 493] said:
"It is a cardinal rule of interpretation that a proviso to
a particular provision of a statute only embraces the
field which is covered by the main provision. It carves
out an exception to the main provision to which it has
been enacted as a proviso and to no other."
Lord Macmillan in Madras & Southern Maharatta Railway Co.
v. Bezwada Municipality [MANU/PR/0060/1944 [(1944) LR 71
IA 113, 122] laid down the sphere of a proviso as follows:
"The proper function of a proviso is to except and deal
with a case which would otherwise fall within the
general language of the main enactment, and its effect
is confined to that case. Where, as in the present case,
the language of the main enactment is clear and
unambiguous, a proviso can have no repercussion on
the interpretation of the main enactment, so as to
exclude from it by implication what clearly falls within
its express terms."
The territory of a proviso therefore is to carve out an
exception to the main enactment and exclude
something which otherwise would have been within
the section. It has to operate in the same field and if
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the language of the main enactment is clear it cannot
be used for the purpose of interpreting the main
enactment or to exclude by implication what the
enactment clearly says unless the words of the proviso
are such that that is its necessary effect. (Vide also
Corporation of City of Toronto v. Attorney-General for
Canada [(1946) AC 32, 37] .)"
15. The proviso goes on to state that an appeal shall lie
from such orders passed by the Commercial Division
of the High Court that are specifically enumerated
under Order XLIII of the Code of Civil Procedure
Code, 1908, and Section 37 of the Arbitration Act. It
will at once be noticed that orders that are not
specifically enumerated under Order XLIII of the
CPC would, therefore, not be appealable, and appeals
that are mentioned in Section 37 of the Arbitration
Act alone are appeals that can be made to the
Commercial Appellate Division of a High Court.
16. Thus, an order which refers parties to arbitration
under Section 8, not being appealable under Section
37(1)(a), would not be appealable under Section 13(1)
of the Commercial Courts Act. Similarly, an appeal
rejecting a plea referred to in sub-sections (2) and (3)
of Section 16 of the Arbitration Act would equally not
be appealable under Section 37(2)(a) and, therefore,
under Section 13(1) of the Commercial Courts Act."
(emphasis supplied)
10) A perusal of the above extract shows that the Supreme Court has
already interpreted and pronounced upon the scope of the appeals
maintainable under Section 13 of the Commercial Courts Act, and while
doing so, the Supreme Court has held that the primary purpose of the
proviso is to qualify the generality of the main part by providing an
exception.
11) This decision of the Supreme Court in Kandla Export Corporation
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(supra ) decided on 07.02.2018, was rendered prior to the judgement in D &
H India Ltd. vs. (supra), rendered by a Division Bench of this Court.
However, this judgement was, apparently, not brought to the notice of the
Division Bench and has, therefore, escaped the attention of the Division
Bench.
12) A perusal of D & H India Ltd. vs. (supra) shows that the Division
Bench has also not referred to and dealt with, specifically Section 13 (2) of
the Commercial Courts Act that, in terms, states that "notwithstanding
anything contained in any other law for the time being in force or Letters
Patent of a High Court, no appeal shall lie from any order or decree of a
Commercial Division or Commercial Court otherwise than in accordance
with the provisions of this Act." Thus, an appeal from an order passed in a
commercial cause would lie only in accordance with Section 13(1) and
13(1A), and not otherwise. An appeal, by resort to the Letters Patent (in the
light of the judgement of the Supreme Court in Shah Babulal Khimji
(supra)) is also not maintainable under Section 13 of the Commercial Courts
Act.
13) With due respect, the judgement of the Division Bench in D & H
India Ltd. (supra) cannot be regarded as laying down the correct
interpretation of Section 13 of the Commercial Courts Act, and we are,
therefore, not bound to follow the same, since there is a contrary view of the
Supreme Court. We are bound by the judgement of the Supreme Court. In
the ordinary course, we would have referred the decision in D & H India
Ltd. vs. (supra) for reconsideration by a larger Bench since, we were
inclined to take a contrary view to that taken in D & H India Ltd. (Supra).
However, since the issue already stands settled by the Supreme Court, there
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is no necessity to adopt that course of action. Hence, in our view, these
appeals are not maintainable, since none of the impugned orders are
appealable under Order XLIII Rule 1 of the Civil Procedure Code.
14) The Appeals are, accordingly, dismissed.
VIPIN SANGHI, J
JASMEET SINGH, J
SEPTEMBER 10, 2021
Sahil Sharma
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