Karnataka High Court
M/S Sanchaya Land And Estates Pvt Ltd vs Hdfc Bank Ltd on 25 November, 2025
Author: M.Nagaprasanna
Bench: M.Nagaprasanna
1
Reserved on : 07.11.2025
Pronounced on : 25.11.2025 R
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 25TH DAY OF NOVEMBER, 2025
BEFORE
THE HON'BLE MR. JUSTICE M. NAGAPRASANNA
CIVIL REVISION PETITION No.679 OF 2025 (IO)
C/W
CIVIL REVISION PETITION No.680 OF 2025(IO)
IN CIVIL REVISION PETITION No.679 OF 2025
BETWEEN:
M/S. SANCHAYA LAND AND ESTATES PVT. LTD.,
HAVING ITS REGISTERED OFFICE AT
NO.315, 1ST MAIN ROAD
GANGANAGAR, BENGALURU - 560 032,
REPRESENTED BY ITS
AUTHORISED SIGNATORY,
MR. DASTAGIR SHARIFF
S/O NOORULLA SHARIFF
... PETITIONER
(BY SRI MANJUNATH S., ADVOCATE )
AND:
1. HDFC BANK LTD.,
(FORMERLY HDFC LTD.,
PRIOR TO AMALGAMATION)
2
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT
RAMON HOUSE, 169, BACKBAY RECLAMATION,
H T PAREKH MARG,
MUMBAI - 400 020.
2. SRI DIVAKARAN SUNIL KUMAR
S/O R DIVAKARAN
AGED ABOUT 60 YEARS
RESIDING AT ANANTHEN KERIL HOUSE,
T V PURAM P.O, MUTHUDATHU KAVU,
VAIKOM, KOTTAYAM DISTRICT,
KERALA - 686 606.
3. M/S.MRUDANI POWER CONTROLS
A PROPRIETARY CONCERN OF
SRI PARAMESHWAR H.S.
HAVING OFFICE AT NO. 11,
3RD CROSS, SUNKADAKATTE,
BENGALURU - 560 091.
... RESPONDENTS
(BY SRI VARUN S., ADVOCATE FOR R-1;
SRI SHIVARAJ N.ARALI, ADVOCATE FOR R-2)
THIS CIVIL REVISION PETITION IS FILED UNDER SECTION
115 OF CIVIL PROCEDURE CODE 1908, PRAYING TO a. CALL FOR
RECORDS AND SET ASIDE THE ORDER DATED 03.09.2025 PASSED
IN COM.O.S.NO.145 OF 2023 ON THE FILE OF THE X ADDITIONAL
DISTRICT AND SESSIONS JUDGE (DEDICATED COMMERCIAL
COURT), BENGALURU RURAL DISTRICT AT BENGALURU,
DISMISSING THE IA FILED BY THE PETITIONER UNDER ORDER 7
RULE 11 READ WITH SECTION 151 OF CPC, TO REJECT THE
COUNTER CLAIM FILED BY THE DEFENDANT NO.1 IN THE INTEREST
OF JUSTICE AND EQUITY; b. ALLOW THE IA FILED BY THE
PETITIONER UNDER ORDER 7 RULE 11 OF THE CPC TO REJECT THE
3
COUNTER CLAIM FILED BY THE DEFENDANT NO.1/RESPONDENT
NO.2 AS AGAINST HE PETITIONER/DEFENDANT NO.2 IN COM
O.S.NO.145 OF 2023 ON THE FILE OF THE X ADDITIONAL
DISTRICT AND DESSEIONS JUDGE (DEDICATED COMMERCIAL
COURT), BENGALURU RURAL DISTRICT AT BENGALURU.
IN CIVIL REVISION PETITION No.680 OF 2025
BETWEEN:
M/S. SANCHAYA LAND AND ESTATES PVT. LTD.,
HAVING ITS REGISTERED OFFICE AT
NO.315, 1ST MAIN ROAD
GANGANAGAR,
BENGALURU - 560 032
REPRESENTED BY ITS
AUTHORISED SIGNATORY
MR. DASTAGIR SHARIFF
S/O NOORULLA SHARIFF.
... PETITIONER
(BY SRI MANJUNATH S., ADVOCATE )
AND:
1. HDFC BANK LTD.,
(FORMERLY HDFC LTD.
PRIOR TO AMALGAMATION)
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT
RAMON HOUSE, 169,
BACKBAY RECLAMATION,
H T PAREKH MARG,
MUMBAI - 400 020.
4
2. SRI DIVAKARAN SUNIL KUMAR
S/O R.DIVAKARAN
AGED ABOUT 60 YEARS
RESIDING AT ANANTHEN KERIL HOUSE,
T V PURAM P.O, MUTHUDATHU KAVU,
VAIKOM, KOTTAYAM DISTRICT,
KERALA - 686 606.
3. M/S.BHARATHI ELECTRICALS
A PROPRIETARY CONCERN OF
SRI R P MANOJ KUMAR
S/O RISHIPAL SINGH S.,
AGED ABOUT 43 YEARS,
RESIDING AT NO. 113,
NGEF LAYOUT, 2ND STAGE,
11TH CROSS, NAGARBHAVI,
BENGALURU - 560 072.
4. M/S. SREE CHARAN SOUHARDHA
CO-OPERATIVE BANK LTD.,
HEAD OFFICE AT NO. 87/1,
H B SAMAJA ROAD, BASAVANAGUDI,
BENGALURU - 560 004.
... RESPONDENTS
(BY SRI VARUN S., ADVOCATE FOR R-1;
SRI SHIVARAJ N.ARALI, ADVOCATE FOR R-2)
THIS CIVIL REVISION PETITION IS FILED UNDER SECTION
115 OF CIVIL PROCEDURE CODE 1908, PRAYING TO CALL FOR
RECORDS AND SET ASIDE THE ORDER DATED 03.09.2025 PASSED
IN COM.O.S.NO.146 OF 2023 ON THE FILE OF THE X ADDITIONAL
DISTRICT AND SESSIONS JUDGE (DEDICATED COMMERCIAL
COURT), BENGALURU RURAL DISTRICT AT BENGALURU,
DISMISSIN THE IA NO.25 FILED BY THE PETITIONER UNDER
ORDER 7 RULE 11 OF CPC, TO REJECT THE COUNTER CLAIM FILED
BY DEFENDANT NO.1 AS AGAINST DEFENDANT NO.2 IN THE
5
INTEREST OF JUSTICE AND EQUITY; b. ALLOW THE IA NO.25 FILED
BY THE PETITIONER UNDER ORDER 7 RULE 11 OF THE CPC TO
REJECT THE COUNTER CLAIM FILED BY THE DEFENDANT
NO.1/RESPONDENT NO.2 AS AGAINST THE
PETITIONER/DEFENDANT NO.2 IN COM.O.S.NO.146 OF 2023 ON
THE FILE OF THE X ADDITIONAL DISTRICT AND SESSIONS JUDGE
(DEDICATED COMMERCIAL COURT), BENGALURU RURAL DISTRICT
AT BENGALURU.
THESE CIVIL REVISION PETITIONS HAVING BEEN HEARD
AND RESERVED FOR ORDERS ON 07.11.2025, COMING ON FOR
PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING:-
CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA
CAV ORDER
The petitioner-defendant No.2, who is common in both these
petitions, is at the doors of this Court calling in question two
separate orders passed by the Commercial Court in Commercial
O.S.No.145 of 2023 and Commercial O.S. 146 of 2023, both dated
03-09-2025, by which the applications filed by the petitioner in
I.A.Nos.24 and 25 under Order VII Rule 11 of the CPC, in the
respective suits, seeking rejection of the counter claim made by the
1st defendant come to be rejected. For the sake of convenience, the
6
facts obtaining in Civil Revision Petition No.679 of 2025 would be
narrated.
2. Heard Sri S.Manjunath, learned counsel appearing for the
petitioner, Sri S.Varun, learned counsel appearing for respondent
No.1 and Sri Shivaraj N. Arali, learned counsel appearing for
respondent No.2.
3. Facts in brief, germane, are as follows:
3.1. 1st respondent-plaintiff / Housing Development
Corporation is said to have sanctioned a housing loan to the 2nd
respondent-1st defendant for purchase of an apartment in the
apartment project "The Greens" of the petitioner-defendant No.2. A
sale agreement, construction agreement and a tripartite agreement
come to be executed between the 1st respondent-plaintiff, the 2nd
respondent-1st defendant and the petitioner-2nd defendant on
19-11-2014 and 25-04-2015. As per the said agreements, the
petitioner-defendant No.2 was required to retain possession of the
apartment purchased by the 2nd respondent-1st defendant until the
7
completion of the project. The petitioner-defendant No.2 was
thereafter required to execute a registered sale deed in favour of
the 2nd respondent-1st defendant. As per the terms of the tripartite
agreement, the petitioner-defendant No.2 could not have cancelled
the allotment or refused to execute a registered sale deed in favour
of the 2nd respondent-1st defendant, without obtaining a no-
objection certificate from the 1st respondent-plaintiff. However, the
petitioner-defendant No.2 executes a registered sale deed in favour
of respondent No.3-defendant No.3 in respect of the apartment
purchased by 2nd respondent-1st defendant. Therefore, the 1st
respondent-plaintiff files a suit in Commercial O.S. No.145 of 2023
seeking specific performance of the tripartite agreement and a
direction directing the petitioner-defendant No.2 to execute a
registered sale deed in favour of the 2nd respondent-1st defendant
and to declare the sale deed dated 10-03-2020 executed by the
petitioner-2nd defendant in favour of the 3rd respondent-3rd
defendant to be null and void.
3.2. The petitioner/2nd defendant files its written statement
contending that there was no cause of action against the present
8
petitioner, as the 1st defendant had failed to pay the entire sale
consideration. Therefore, the agreement stood cancelled and after
such cancellation, a sale deed was executed in favour of defendant
No.3. The 1st defendant/2nd respondent herein also files his written
statement, and along with the written statement, files a
counterclaim not only against the plaintiff, but also against
defendant No.2, the co-defendant. By way of counterclaim, the 1st
defendant sought multiple reliefs including declaration of obligations
against the 2nd defendant under the agreements. The petitioner-
defendant No.2 files an application in I.A. No.24 to reject the
counter claim, on the score that a counter claim against a co-
defendant is not maintainable. The application so filed by the
petitioner comes to be rejected. Therefore, the petitioner-defendant
No.2 is now before this Court in the subject petitions.
4. The learned counsel appearing for the petitioner would
vehemently contend that a counterclaim is not maintainable against
a co-defendant. He would seek to place reliance upon the judgment
of the Apex Court in the case of ROHIT SINGH v. STATE OF
BIHAR reported in (2006) 12 SCC 734 and the judgment of the
9
Punjab and Haryana High Court in the case of ASHOK KUMAR
SHARMA v. RAKESH KUMAR SHARMA reported in 2024 SCC
OnLine P & H 4859 to buttress his submission that counterclaim
against a co-defendant is not entertainable.
5. Per contra, the learned counsel appearing for the 1st
respondent would vehemently refute the submissions in contending
that the petitioner has to first cross the threshold bar of
maintainability of the petition. It is his submission that a revision
petition against an interlocutory order passed by the Commercial
Court under Section 8 of the Commercial Courts Act, 2015 ('the Act'
for short) cannot be held to be maintainable and if the revision is
not maintainable, none of the submissions of the petitioner should
merit any consideration. In the event this Court would hold that
revision is maintainable, the learned counsel for the 1st respondent
would seek to place reliance upon the judgment of the Apex Court
in the case of RAJUL MANOJ SHAH v. KIRANBHAI
SHAKRABHAI PATEL reported in 2025 SCC OnLine SC 1958 and
ROHIT SINGH to buttress his submission that counterclaim against
a co-defendant if it touches upon the rights of the plaintiff would be
10
maintainable. He would contend that the judgment rendered by the
Punjab and Haryana High Court is long before the judgment of the
Apex Court and, therefore, the judgment of the Apex Court in the
case of RAJUL MANOJ SHAH would prevail. The learned counsel
representing the 2nd respondent-1st defendant would also toe the
lines of the learned counsel appearing for the 1st respondent in
contending that petitions are not maintainable and even if it they
are held to be maintainable, he would adopt the submissions of the
1st respondent.
6. I have given my anxious consideration to the submissions
made by the respective learned counsel and have perused the
material on record. In the light of the submissions and contra
submissions of respective parties, the following issues fall for my
consideration:
(i) Whether the revision against interlocutory orders
passed by the Commercial Court would be
maintainable and entertainable?
(ii) Whether the subject petitions can be converted
into petitions under Article 227 of the Constitution
of India and issues be decided?
11
(iii) Whether a counterclaim is maintainable against a
co-defendant?
Issue No.1:
(i) Whether the revision against interlocutory orders
passed by the Commercial Court would be
maintainable and entertainable?
7.1. The petitioner has preferred these revision petitions
assailing interlocutory orders rendered by the concerned Court in
the aforementioned commercial original suits. Since the
respondents have raised substantial objections touching the very
root of maintainability, this Court is compelled to now navigate the
statutory frame work that governs the threshold bar. For the said
purpose, it is necessary to advert to the relevant provisions of the
Act. Sections 8 and 13 of the Act read as follows:
"8. Bar against revision application or petition
against an interlocutory order.--Notwithstanding
anything contained in any other law for the time being in
force, no civil revision application or petition shall be
entertained against any interlocutory order of a
Commercial Court, including an order on the issue of
jurisdiction, and any such challenge, subject to the
provisions of Section 13, shall be raised only in an appeal
against the decree of the Commercial Court.
... ... ...
13. Appeals from decrees of Commercial Courts and
Commercial Divisions.--(1) Any person aggrieved by the
12
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.
(1-A) 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)
A plain yet purposive reading of Section 8 reveals that the
legislation has consciously employed a sweeping non-obstante
clause of express embargo against entertaining any civil revision
application or petition directed against an interlocutory order of a
Commercial Court. The provision mandates that any challenge to
such order must await the stage of appeal directed against the
13
decree, subject to the conditions in Section 13 of the Act. Section
13 deals with appeals from decrees of Commercial Courts. Any
person aggrieved by a judgment or order of a Commercial Court
exercising original civil jurisdiction as the case may be, may appeal
to the Commercial Appellate Division of the High Court.
7.2. In the present case, the interlocutory orders impugned
concern rejection of application under Order VII Rule 11 of the CPC
preferred in both Commercial O.S.No.145 of 2023 and Commercial
O.S.No.146 of 2023, whereby, the petitioner - defendant No.2 have
sought rejection of the counter claim set up by defendant No.1 on
the ground that counter claim is not entertainable against a co-
defendant. Had these proceedings arisen in the regime of a regular
civil suit, a revision petition challenging the order refusing to reject
a plaint or counter claim under Order VII Rule 11(d) might have
well been maintainable. However, the statutory landscape under
the Act is distinct, the statutory bar under Section 8 is unequivocal
leaving little interpretative wiggle room. The question therefore
becomes imperative whether on such statutory inhibition the Court
may nonetheless entertain such challenge. The question is no
14
longer res integra. A Division Bench of the High Court of Delhi in
the case of BLACK DIAMOND TRACKPARTS PRIVATE LIMITED
v. BLACK DIAMOND MOTORS PRIVATE LIMITED1, has held as
follows:
".... .... ....
9. The question of maintainability of a petition under
Article 227 of the Constitution of India, with respect to
proceedings in a commercial suit before the District Judge
(Commercial) arose, because Section 8 of the Commercial
Courts Act as under:
"8. Bar against revision application or
petition against an interlocutory order.--
Notwithstanding anything contained in any other law
for the time being in force, no civil revision application
or petition shall be entertained against any
interlocutory order of a Commercial Court, including an
order on the issue of jurisdiction, and any such
challenge, subject to the provisions of section 13, shall
be raised only in an appeal against the decree of the
Commercial Court."
10. Expressly bars the remedy of "civil revision
application or petition". It was deemed apposite to hear the
counsels on, whether by use of the word "petition" in addition to
the words "civil revision application", though with a "or"
between them, the purport of Section 8 supra was to also bar
the remedy of Article 227 petition with respect to proceedings in
a commercial suit at the level of the District Judge. The remedy
under Article 227 of the Constitution of India, it was felt, was
similar/identical/at par with the remedy of a civil revision
application under Section 115 of the CPC and it was thus
deemed appropriate to frame the question no. (i) aforesaid and
hear the counsels thereon. Similarly, it was deemed apposite to
hear the counsels on the reasoning which prevail with the Single
Judge, that since appeals against orders in a commercial suit at
1
2021 SCC OnLine Del 3946
15
the level of the District Judge are to be heard by the
Commercial Appellate Division, petitions under Article 227, if
maintainable, emanating from proceedings in such suits should
also be heard by the Commercial Appellate Division.
Accordingly, question no. (ii) aforesaid was framed.
11. The senior counsel for the respondent in CM (M) No.
132/2021, in our view, has rightly contended and none of the
other counsels have controverted, that the remedy under Article
227 being a constitutional remedy could not be affected by a
statute framed by a legislature which was itself a creature of
constitution. A creature of the Constitution of India cannot
act in negation of the provisions of the Constitution of
India. We are reminded of Surya Dev Rai v. Ram Chander
Rai (2003) 6 SCC 675, concerned with the impact of the
amendment in Section 115 of the CPC brought about by
the amendment of the CPC with effect from 1st July, 2002.
In the wake of the said amendment, a question arose,
whether on such amendment restricting/limiting the
orders of the subordinate courts with respect to which a
revision application under Section 115 of the CPC could
be preferred to the High Court, an aggrieved person was
completely deprived of the remedy of judicial review
under Article 227 also. It was held, that curtailment of
revisional jurisdiction of the High Court did not take away
and could not have taken away the constitutional
jurisdiction of the High Court to issue a writ of certiorari
to a civil court, nor was the power of superintendence
conferred on the High Court under Article 227 of the
Constitution taken away or whittled down. It was further
held that the said power continued to exists,
untrammelled by the amendment in Section 115 CPC and
remained available to be exercised, subject to the rules of
self-discipline and practice, which were well settled.
Similarly, in State of Gujarat v. VakhatsinghjiVajesinghji,
Vaghela AIR 1968 SC 1481, Jetha Bai and Sons, Jew
Town, Cochin v. SunderbasRathenai (1988) 1 SCC
722, State of H.P. v. DhanwantSingh (2004) 13 SCC
331 and Union of India v. Major General Shri Kant
Sharma (2015) 6 SCC 773 it was held that the legislature
cannot take away the power of superintendence of the
High Court under Article 227 of the Constitution over all
Courts and Tribunals which are within the territories in
16
relation to which the High Court exercises its jurisdiction.
Rather, in L. Chandra Kumar v. Union of India (1997) 3 SCC
261, judicial review including under Article 227, was held to be a
basic feature of the Constitution, even beyond the realm of
amendability and Clause 2(d) of Article 323A and Clause 3(d) of
Article 323B, to the extent excluded the jurisdiction of the High
Court and Supreme Court under Articles 226/227 and 32 of the
Constitution with respect to matters falling within the
jurisdiction of the Courts and Administrative Tribunals referred
to therein, were held to be unconstitutional.
12. Thus, the question no. (i) aforesaid is answered
by holding that the petition under Article 227 of the
Constitution of India to the High Court with respect to
orders of the Commercial Courts at the level of the
District Judge is maintainable and the jurisdiction and
powers of the High Court has not been and could not have
been affected in any manner whatsoever by Section 8 of
the Commercial Courts Act. The use of the word
"petition" in Section 8 is not and could not have been
with reference to a petition under Article 227 of the
Constitution and is with reference to a revision
application/revision petition only.
... ... ...
31. We are of the view that once the Commercial Courts
Act has expressly barred the remedy of a revision application
under Section 115 of the CPC, with respect to the suits within its
ambit, the purpose thereof cannot be permitted to be defeated
by opening up the gates of Article 227 of the Constitution of
India. The scope and ambit of a petition under Article 227
is much wider than the scope and ambit of a revision
application under Section 115 of the CPC; whatever can
be done in exercise of powers under Section 115 of the
CPC, can also be done in exercise of powers under Article
227 of the Constitution. Allowing petitions under Article
227 to be preferred even against orders against which a
revision application under Section 115 CPC would have
been maintainable but for the bar of Section 8 of the
Commercial Courts Act, would nullify the legislative
mandate of the Commercial Courts Act. Recently, in Deep
Industries Limited v. Oil and Natural Gas Corporation
Limited (2020) 15 SCC 706, in the context of petitions under
17
Article 227 of the Constitution of India with respect to orders in
an appeal against an order of the Arbitral Tribunal under Section
17 of the Arbitration & Conciliation Act, 1996, it was held that if
petitions under Article 226/227 of the Constitution against
orders passed in appeals under the Arbitration Act were
entertained, the entire arbitral process would be derailed and
would not come to fruition for many years. It was observed that
though Article 227 is a constitutional provision which remains
untouched by an non-obstante Clause 5 of the Arbitration Act
but what is important to note is that though petitions can be
filed under Article 227 against judgments allowing or dismissing
First Appeals under the Arbitration Act, yet the High Court would
be extremely circumspect in interfering with the same taking
into account the statutory policy, so that interference is
restricted to orders which are patently lacking in inherent
jurisdiction. Thus, though we are of the view that gates of
Article 227 ought not to be opened with respect to orders in
commercial suits at the level of the District Judge against which
a revision application under CPC was maintainable but which
remedy has been taken away by the Commercial Courts Act, but
abiding by the judgments aforesaid, hold that it cannot be said
to be the law that jurisdiction under Article 227 is completely
barred. However the said jurisdiction is to be exercised very
sparingly and more sparingly with respect to orders in such suits
which under the CPC were revisable and which remedy has been
taken away by a subsequent legislation i.e. the Commercial
Courts Act, and ensuring that such exercise of jurisdiction by the
High Court does not negate the legislative intent and purpose
behind the Commercial Courts Act and does not come in the
way of expeditious disposal of commercial suits."
(Emphasis supplied)
The said judgment of the Division Bench of the Delhi High Court, is
followed by the High Court of Odisha in the case of NARAYAN
NAIK v. RANJITA NAIK2, wherein it is held as follows:
2
2025 SCC OnLine Ori 2112
18
".... .... ....
17. The provisions of Section 8 of the Commercial
Courts Act, 2015 cannot operate as an absolute bar to
exercise of the power under Article 227 of
the Constitution of India. Section 8 despite its initial non-
obstante clause, cannot operate as an absolute bar to the
exercise of the power of judicial review by the High
Courts, which is conferred by the Constitution of
India under Article 227 thereof, since the 2015 Act is a
subordinate legislation under the Constitution, the latter
being the ground norm of the Indian legal system cannot
obstruct the powers of this Court under
Articles 226 and 227 of the Constitution of India.
18. A creature of the Constitution of India cannot act in
negation of the provisions of the Constitution of India. This
Court is reminded of Surya Dev Rai v. Ram Chander Rai1,
concerned with the impact of the amendment in
Section 115 CPC brought about by the amendment of
the CPC with effect from 1-7-2002. In the wake of the said
amendment, a question arose, whether on such amendment
restricting/limiting the orders of the subordinate courts with
respect to which a revision application under
Section 115 CPC could be preferred to the High Court, an
aggrieved person was completely deprived of the remedy of
judicial review under Article 227 also. It was held, that
curtailment of revisional jurisdiction of the High Court did not
take away and could not have taken away the constitutional
jurisdiction of the High Court to issue a writ of certiorari to a
civil court, nor was the power of superintendence conferred on
the High Court under Article 227 of the Constitution taken away
or whittled down. It was further held that the said power
continued to exists, untrammelled by the amendment in
Section 115 CPC and remained available to be exercised,
subject to the rules of self-discipline and practice, which were
well settled. Similarly, in State of
Gujarat v. VakhatsinghjiVajesinghji Vaghela2, Jetha Bai &
3
Sons v. Sunderdas Rathenai , State of H.P. v. Dhanwant
Singh4 and Union of India v. Shri Kant Sharma5 it was held that
the legislature cannot take away the power of Superintendence
of the High Court under Article 227 of the Constitution over all
19
courts and tribunals which are within the territories in relation to
which the High Court exercises its jurisdiction. Rather, in L.
Chandra Kumar v. Union of India6, judicial review including
under Article 227, was held to be a basic feature of
the Constitution, even beyond the realm of amendability and
Clause 2(d) of Article 323-A and Clause 3(d) of Article 323-B, to
the extent excluded the jurisdiction of the High Court and
Supreme Court under Articles 226/227 and 32 of
the Constitution with respect to matters falling within the
jurisdiction of the courts and Administrative Tribunals referred
to therein, were held to be unconstitutional.
19. Parliament has, mandated that no civil revision
application or petition shall be entertained against the
interlocutory order of Commercial Court. Parliament has taken
care to provide that an interlocutory order on the issue of
jurisdiction also cannot be made the subject-matter of challenge
and any challenge to such order shall be raised only in an
appeal against the decree of Commercial Court. Having regard
to the legislative object and the intent of the legislature in
barring the remedy of revision, which is otherwise available to a
party in civil proceedings, the exercise of writ jurisdiction under
Article 227 of the Constitution of India, though not ousted, yet
needs to be informed by the limited nature of the said
jurisdiction, lest the legislative object of proscribing revision
would be defeated if the legality, propriety and correctness of
every order passed by the Commercial Court is examined in
exercise of the supervisory jurisdiction under Article 227 of
the Constitution of India.
20. Thus this petition under Articles 226 and 227 of
the Constitution of India with respect to orders of the
Commercial Courts at the level of the District Judge is
maintainable and the jurisdiction and powers of the High Court
have not been affected in any manner whatsoever by Section 8
of the Commercial Courts Act. However, this Court shall
endeavour to exercise restraint unless the matter warrants
interference."
(Emphasis supplied)
20
The Division Bench of the High Court of Delhi and the single judge
Bench of the High Court of Odisha, while analyzing the legislative
intent and the scheme of the Act, hold that the statutory bar
against revision under Section 8 of the Act is absolute. Therefore,
interlocutory orders passed by Commercial Courts is not amenable
to revisional jurisdiction. The High Court of Delhi and the High Court
of Odisha in the afore-quoted judgments observe that jurisdiction
under Article 227 can never be taken away by projecting a bar
against revision petitions created under Section 8 of the Act. In that
light, the petitioner, in the case at hand, who has filed the revision
petitions ought to have preferred a petition under Article 227 of the
Constitution of India.
7.3. This Court, on 12-09-2025, had passed an order
disposing of these petitions on a submission made by the learned
counsel for the petitioner that he would file an appeal. Thereafter,
it was immediately moved contending that the appeal is not
maintainable and, therefore, the revision petitions would be
maintainable. Owing to the application so filed by the petitioner,
this Court passed the following order on 24-09-2025:
21
"ORAL ORDER ON I.A.NO.2 OF 2025
The subject petition was disposed on 12.09.2025 owing to
the fact that an alternative remedy of filing an appeal was
available. Learned counsel for petitioner has moved the matter
on the score that the submission was erroneously made that an
appeal remedy was available. According to the learned counsel,
appeal is not a remedy that is available under the Statute and
would submit that he would convince the Court.
In that light, application is allowed and the order dated
12.09.2025 stands recalled and petition is restored to file.
Tag this petition along with CRP No.680 of 2025 and list
the matters on 14.10.2025 to hear the learned counsel for
petitioner and the respondents, further.
In the light of interim order subsisting in the connected
case, there shall be an interim order, in the subject petition as
well, till the next date of hearing."
No doubt, an appeal as obtaining under Section 13 of the Act would
not be maintainable, as it is only against a decree passed by the
Commercial Court. However, as held by the High Court of Delhi
followed by the High Court of Odisha, to which I am in complete
agreement of, the revision petition cannot be entertained. The
petitioner will have to prefer a petition under Article 227 of the
Constitution of India and not a revision petition under Section 115
of the CPC. Therefore, I hold that revision petitions will not be
maintainable against interlocutory orders passed by the Commercial
Court under Section 8 of the Act.
Issue No.2:
(ii) Whether the subject petitions can be converted
into petitions under Article 227 of the Constitution
of India and issues be decided?
8.1. Having thus concluded that the present revision petitions
are not maintainable within the statutory contours of Section 8 of
the Act, the issue now would be, whether this Court may in the
interest of justice, treat the present proceedings, as petitions
invoking the supervisory jurisdiction, of this Court under Article 227
of the Constitution of India. Such treatment is neither novel nor
unprecedented. The power of the High Court under Article 227 of
the Constitution of India, exists independent of and unaffected by
statutory curtailments applicable to the revisional jurisdiction under
the CPC. The Apex Court in the case of COL.ANIL KAK (RETD.) v.
MUNICIPAL CORPORATION, INDORE3, has held as follows:
".... .... ....
2. All that the High Court has done is to treat the petition
filed before it under Section 115 of the Code as a proceeding
initiated under Article 227 of the Constitution. The respondents
had filed the revision originally and during the pendency of that
revision the High Court appears to have taken a view that an
order in an appeal arising from a proceeding under Order 39
(2005) 12 SCC 734
Rules 1 and 2 of the Code, could not be challenged under
Section 115 of the Code since the order was in the nature of an
interlocutory order. In such a situation, in our view, the
High Court rightly decided to permit the revision
petitioners before it, to convert the same as a proceeding
under Article 227 of the Constitution. After all, the court
could have done it on its own, even without a motion in
that behalf by the petitioner. We see absolutely no
ground to interfere with the said order on the grounds
raised in this special leave petition. Hence, this special
leave petition is dismissed."
(Emphasis supplied)
The Apex Court has expounded, that even when statutory
bar expressly curtails revisional or appellate remedies, such
ouster cannot be extended to trammel the constitutional
powers of the High Court under Article 226 or 227 of the
Constitution of India. The Apex Court was considering whether
the High Court was right in treating a petition filed before it under
Section 115 of the Code as a proceeding under Article 227 of the
Constitution of India. The High Court had decided the issue by
converting the revision petition into a petition under Article 227.
The Apex Court refused to interfere.
8.2. A Division Bench of the High Court of Telangana in the
case of NCC LIMITED v. NATIONAL INSTITUTE OF
TECHNOLOGY NIT4, has held as follows:
".... .... ....
15. The issue of maintainability of the present Civil
Revision Petitions (CRPs) should be answered first.
16. The bar contained in section 8 of The
Commercial Courts Act, 2015 ('the 2015 Act') pertains to
entertaining Civil Revision Petitions from an interlocutory
order of a Commercial Court including any order on the
issue of jurisdiction of the Commercial Court. Section 8 of
the 2015 Act mandates that a challenge to an
interlocutory order passed by a Commercial Court shall be
filed in accordance with the statutory framework of
section 13 of the 2015 Act. In other words, the correct route
would be to file an appeal under section 13(1) or (1A) of the
Act.
17. The Supreme Court in Shalini Shyam Shetty Vs.
Rajendra Shankar Patil delineated the principles on the exercise
of the High Court's jurisdiction under Article 227 of the
Constitution of India and limited the scope of such power in
matters of interference in orders of Courts inferior to the High
Courts. The power to interfere was circumscribed within the
boundaries of patent perversity, gross or manifest failure of
justice or violation of the principles of natural justice. In other
words, the Supreme Court held that the power of
superintendence should be sparingly exercised only in fit cases
i.e., to keep strict administrative control of the Courts within the
territory of the High Court.
Civil Revision Petition Nos. 2714, 2715 and 2716 of 2024 decided
on 29-04-2025
18. A Division Bench of this High Court in M.V.Ramana
Rao Vs. N.Subash considered the issue of maintainability of a
CRP against the embargo contained in the 2015 Act and diluted
the stricture contained therein by drawing a distinction between
the power of revision under section 115 of The Code of Civil
Procedure, 1908 ('CPC') and under Article 227 of the
Constitution of India. The High Court held that the power of
judicial review under Article 227 cannot be taken away by
section 8 of the 2015 Act but cautioned against misuse of
the power in undeserving cases. A Division Bench of the
High Court of Andhra Pradesh expressed the same
opinion i.e., section 8 of the 2015 Act is confined to a CRP
filed under section 115 of the CPC and does not operate
as a bar to the jurisdiction of a High Court under Article
227 of the Constitution of India.
19. In Blue Cube Germany Assets Gmbh And Co. KG Vs.
Vivimed Labs Limited, a Division Bench of the erstwhile High
Court of Judicature at Hyderabad for the State of Telangana and
Andhra Pradesh clarified that although the nomenclature given
by the Court under Article 227 of the Constitution of India is
'Civil Revision Petition' it is not equivalent to a Revision Petition
under section 115 of the CPC. It was further clarified that
the power of judicial superintendence vested in a High
Court under Article 227 of the Constitution cannot be
equated to ordinary revisional jurisdiction. The Court also
clarified that the petitions filed under Article 227 in
several High Courts are not referred to as 'Civil Revisions'
but as 'Writ Petitions (Civil)'. In other words, the Division
Bench held that the nomenclature of 'Civil Revision
Petition' to petitions filed under Article 227 would not fall
within the statutory bar in section 8 of the 2015 Act.
20. The discussion becomes somewhat academic in view
of the Supreme Court's decision in Col. Anil Kak (Retd.) Vs.
Municipal Corporation, Indore where it was held that a High
Court is authorized to convert a petition filed under
section 115 of the CPC to a proceeding under Article 227
of the Constitution on its own even without a motion in
that behalf by the petitioner before it.
21. Therefore, the argument of the respondent that the
CRPs are not maintainable in view of the bar in section 8 of the
2015 Act cannot be accepted. We accordingly hold that the CRPs
are maintainable."
(Emphasis supplied)
The Division Bench of the High Court of Telangana follows the
judgment of the Apex Court in the case of ANIL KAK supra. The
Division Bench also was faced with the circumstance of non-
maintainability of revision petition filed against an interlocutory
order under Section 8 of the Commercial Courts Act. The Division
Bench holds that filing of a petition under Section 115 CPC does not
operate as a bar to the jurisdiction of a High Court under Article
227 of the Constitution of India, but however in the facts holds that
civil revision petition is maintainable.
8.3. Driving back to the cases at hand, as observed
hereinabove, the petitions are filed under Section 115 of the CPC
projecting them to be revision petitions against an order rejecting
the counterclaim under Order VII Rule 11 of the CPC. In the light
of the law laid down by the Apex Court, which is followed by the
Division Bench of the High Court of Telangana under identical
circumstance, I deem it appropriate to answer the core issue in the
cases at hand, by converting the subject petitions, to that of
petitions under Article 227 of the Constitution of India. I therefore,
answer the issue accordingly.
Issue No.3:
(iii) Whether a counterclaim is maintainable against a
co-defendant?
9.1. The subject issue forms the kernel of the conundrum.
This concerns the issue of maintainability of a counterclaim directed
against a co-defendant. The plaintiff is HDFC Bank. The plaintiff
institutes the suits in Commercial O.S.Nos.145 of 2023 and 146 of
2023 for specific performance of a tripartite agreement which
directs the present petitioner to execute a sale deed in favour of the
1st defendant. The second prayer in both suits is to declare the sale
deeds dated 10-03-2020 and 13-03-2020 executed by the present
petitioner in favour of the 3rd defendant to be null and void. The 3rd
prayer is to declare that the plaintiff has exclusive charge over the
suit schedule property. The cause of action that leads to the
institution of both the suits is that the petitioner/developer has an
agreement with the homebuyer and the plaintiff-Bank, but the
developer sells the property to defendant No.3 during the
subsistence of a mortgage between the other two. Two suits spring
on identical cause of action between these parties as there were
two transactions. Defendants 1 and 2 filed separate written
statements. While so doing, the 1st defendant files a counter claim
against the plaintiff and the 2nd defendant. Therefore, the issue is
whether the counterclaim of defendant No.1 against the 2nd
defendant was maintainable. The actions then spring - one from
the hands of the plaintiff, the HDFC Bank and the other from the
hands of the present petitioner/defendant No.2, the developer. The
concerned Court on the following reasons rejects both the
applications. The reasons so rendered insofar as they are germane,
in Commercial O.S.No.145 of 2023, are as follows:
".... .... ....
26. But, in the humble opinion of this court, this case law
also cannot be relied upon and applied by this court. Because,
this decision also is not rendered on the order passed on the
application filed under order VII rule 11 of CPC. It is rendered
on the order passed on the application filed under section 10 of
CPC. As mentioned above, in this decision, also, it is not the
observation of Hon'ble High court that in such case, the counter
claim of the defendant shall be resulted in the rejection of plaint
invoking order 7 rule 11 of CPC. The question before the said
court was also not whether the defendant can make a counter
claim against the co-defendant or not. The question was as to
whether there is application of section 10 of CPC to the facts
and circumstances of the said case or not. This can be easily
make out from the observations of the Hon'ble High Court in
para no.11 of the said judgment. It is clearly observed in the
said para that the interse dispute between the plaintiff and
defendant is not a subject matter of earlier suit. They are co-
defendants in the earlier suit. The plaintiff cannot file cross suit
against defendant to protect his suit land in the pending first
appeal and thus present suit is very much maintainable and not
liable to be stayed.
27. Moreover, it is to be noted that in Rohit Singh Vs
State of Bihar referred supra, with due respect and in the
humble opinion of this court, Hon'ble Supreme Court has not
held that the counter claim is not maintainable against the co-
defendant. As per the observations of the said case, if the
counter claim is made solely against co-defendant, then it is not
maintainable. If the counter claim-is made incidentally or along
with the plaintiff, then it is maintainable. In this regard for
clarity and brevity and for ready reference, the observation of
the Hon'ble Supreme court in para 21 of the said judgment is
extracted hereunder.
21. Normally, a counter-claim, though based
on a different cause of action than the one put in
suit by the plaintiff could be made. But, it appears
to us that a counter-claim has necessarily to be
directed against the plaintiff in the suit, though
incidentally or along with it, it may also claim
relief against the co-defendants in the suit. But a
counter-claim directed solely against the co-
defendants cannot be maintained. By filing a
counter-claim the litigation cannot be converted
into some sort of an interpleader suit. Here,
defendants 3 to 17 had no claim as against the
plaintiff except that they were denying the right
put forward by the plaintiff and the validity of the
document relied on by the plaintiff and were
asserting a right in themselves. They had no case
even that the plaintiff was trying to interfere with
their claimed possession. Their whole case was
directed against defendants 1 and 2 in the suit and
they were trying to put forward a claim as against
the State and were challenging the claim of the
State that the land involved was a notified forest
in the possession of the State. Such a counter-
claim, in our view, should not have been
entertained by the trial court.
28. From the above observation of the Hon'ble
Supreme court it is very clear that there is no bar for the
defendant to make a counter claim against the co-
defendant if same is directed along with the plaintiff.
Such claim may be incidental or along with the plaintiff.
However, such claim solely against the co-defendant
cannot be maintained. Therefore, the decision relied upon by
the defendant No.2 as per decision reported in 2024 SCC on
line MP 1301 stated supra is also not useful to the defendant
No.2. The another decision relied upon by the defendant No.2 is
the decision reported in 2024 SCC on line P and H 4859
rendered in case of Ashok Kumar Sharma Vs Rakesh Kumar
Sharma and others. The defendant No. 2 relying upon
observation Hon'ble High Court made in para 18, 19 and 20 of
the said decision contended that the counter claim of the
defendant against the co-defendant is not maintainable and
liable to be rejected under order VII rule 11 of CPC.
29. But, again it is significant to note that this
decision is also not rendered in the background of the
application under order 7 rule 11 of CPC. The facts and
circumstances of this case and the relied case also are
different and distinguishable. In the present suit, it is to
be noted that the plaintiff, defendant No.1 and defendant
No.2 have entered into Tripartite Agreement dated
25/04/2015. There are numerous obligations to be
performed by each party as per the said document. Those
obligations are mutual and ancillary each other. As per
the said document each party is entitled for seeking the
performance. Admittedly the defendant no.2 has sold the
subject flat to the defendant No.3. If it was not sold, even
the defendant No. 2 could have been sought for specific
performance against the plaintiff and defendant No.1.
Therefore, the set of facts and circumstances involved in
the present case and that of the case relied. by the
defendant No.2 are different and distinguishable. Hence,
the said decision is also not applicable to the case.
30. All the more, it is to be noted even for the sake
of arguments, it is taken that all the decisions relied upon
by the defendant No.2 are applicable to the case on hand
and the counter claim of the defendant No.1 is not
maintainable, even then, in the opinion of this court, the
application filed by the defendant No.2 cannot be allowed
by this court. Because, none of the decisions relied upon
by the defendant no.2 lays down the law that if the
counter claim is not maintainable, then such the counter
claim of the defendant has to be rejected under order VII
rule 11 CPC. However, under these circumstances, a
question may arise as to what happens to the counter-
claim made by the defendant and how it would effect the
co-defendant against whom counter-claim is made. It is
to be noted that answer to this question can be found in
the third judgment relied upon by the defendant No.2
rendered in case of Ashok kumar Sharma Vs Rakesh
Kumar sharma and other stated supra. In para 20 of the
said judgment the Hon'ble High Court of Punjab and
Hariyana relied upon its earlier decision rendered in case
Soma Devi Vs Dashmiri Lal reported in 2017 (4) Law
herald 3362 and held that:
"In case defendant filed counter claim
against a co-defendants then co-defendant has not
been given any right to file written statement to
the counter claim under order VII rule 6A. Nor has
a defendant been given any entitlement to make
an application for exclusion of a counter claim filed
by co-defendant against him. Nor the default of a
defendant to file written statement in counter
claim by a co-defendant, is prescribed as ground
for pronouncing the judgment against such a co-
defendant. Even the balance of the relief after
adjustment of counter claim is not contemplated
to be granted against the co-defendant by the
CPC."
31. As such from the above observations of the
Hon'ble Punjab and Hariyana High Court, what this court
conclude is that, if the defendant makes a counter-claim
which is not provided under law, then the co-defendant
against whom the counter claim is made need not
answer such counter claim. Under such circumstances,
the averments made by way counter claim by the co-
defendant become redundant and useless. Ultimately.
while deciding the case on merits, the court can give a
finding over it. It is to be noted that as per the
contentions of the defendant No.2, the law does not
provide the defendant No.1 for the filing the counter-
claim against the co-defendant/Defendant No.2. If that is
the case, at the same time, it has to be noted that law
also does not provide for filing application for rejection of
counter-claim made against co-defendant. It is to be
noted that in the present case, it is not that the counter-
claim of the defendant is barred under any law, but is a
case where there is no provision for filing the counter
claim by the defendant against the co-defendant. Unless
and until some law prohibits the counter-claim of the co-
defendant No.1, this court is bound to take it on record.
This court can decide its maintainability its proof, validity
etc., during the trial. The plaintiff and defendant No.2 can
convince this court on merits about the counter claim of
the defendant no.1 against them. Therefore, under these
circumstances, viewed from any angle, at this stage, the
question of rejecting the counter claim of the defendant
No.1, against the defendant No.2 or the plaintiff, that too
invoking order VII rule 11 of CPC would not arise at all.
Therefore, application filed by the defendant No.2 has to be
rejected. Accordingly, point No.2 is answered in the
negative.
32. Point No. 3: In view of this court's answers to point
No. 1 to 3 this Court proceeds to pass the following:
ORDER
IA No.23 filed by the plaintiff under
Order 7 Rule 11(b) and (d) read with Section
151 of CPC and IA-24 filed by the defendant
No. 2 under order 7 rule 11 of CPC to reject
the counter claim of the defendant No.1 are
hereby rejected.
Call for further chief of Dw1 and 2.
It is notice that since long time the case
is pending for trial. The parties are making
the applications one or other. This was also
once posted for argument. Therefore, all the
parties to the suit are directed to complete
the proceedings without seeking further
adjournments.
Call on 04/09/2025."
(Emphasis added)
It is the aforesaid order that has driven the petitioner to this Court
in the subject petitions. What was projected before the concerned
Court is projected before this Court as well. Therefore, it becomes
necessary to notice the provision of law viz., Order VIII Rule 6A &
6E of the CPC, which deal with counter claim and default of plaintiff
to reply to the counter-claim. They read as follows:
"6A. Counter-claim by defendant.--(1) A defendant
in a suit may, in addition to his right of pleading a set-off
under rule 6, set up, by way of counter-claim against the
claim of the plaintiff, any right or claim in respect of a
cause of action accruing to the defendant against the
plaintiff either before or after the filing of the suit but
before the defendant has delivered his defence or before
the time limited for delivering his defence has expired,
whether such counter-claim is in the nature of a claim for
damages or not:
Provided that such counter-claim shall not exceed the
pecuniary limits of the jurisdiction of the court.
(2) Such counter-claim shall have the same effect as a
cross-suit so as to enable the Court to pronounce a final
judgment in the same suit, both on the original claim and on the
counter-claim.
(3) The plaintiff shall be at liberty to file a written
statement in answer to the counter-claim of the defendant
within such period as may be fixed by the court.
(4) The counter-claim shall be treated as a plaint and
governed by the rules applicable to plaints."
(Emphasis supplied)
A perusal at Order VIII Rule 6A would in the first blush indicate any
counterclaim is required to be directed only against the plaintiff and
not against the defendants. The Apex Court in the case of ROHIT
SINGH5 supra interprets the very provision, and holds as follows:
".... .... ....
21. Normally, a counterclaim, though based on a
different cause of action than the one put in suit by the
plaintiff could be made. But, it appears to us that a
counterclaim has necessarily to be directed against the
plaintiff in the suit, though incidentally or along with it, it
may also claim relief against the co-defendants in the
suit. But a counterclaim directed solely against the co-
defendants cannot be maintained. By filing a
counterclaim the litigation cannot be converted into some
sort of an interpleader suit. Here, Defendants 3 to 17 had no
claim as against the plaintiff except that they were denying the
right put forward by the plaintiff and the validity of the
document relied on by the plaintiff and were asserting a right in
themselves. They had no case even that the plaintiff was trying
to interfere with their claimed possession. Their whole case was
directed against Defendants 1 and 2 in the suit and they were
trying to put forward a claim as against the State and were
challenging the claim of the State that the land involved was a
notified forest in the possession of the State. Such a
(2006) 12 SCC 734
counterclaim, in our view, should not have been entertained by
the trial court."
(Emphasis supplied)
The Apex Court holds, normally a counter claim though based on
different cause of action than the one put in the suit by the plaintiff,
could not be made. But, in the case before the Apex Court the
counterclaim was necessarily directed against the plaintiff though
incidentally along with it, it had a relief claimed against a co-
defendant. If the relief claimed against co-defendant touches upon
a counter claim on the plaintiff, it would become maintainable is
what the Apex Court holds.
9.2. A learned single Judge of this Court interpreting Order
VIII Rule 6A CPC in the case of M/s ALLIANCE UNIVERSITY v.
SUDHIR6, has held as follows:
".... .... ....
84. Order VIII, Rule 6 A of the CPC deals with counter-
claim by defendant. It is as under:
6A. Counter-claim by defendant:
(1) A defendant in a suit may, in addition to his right
of pleading a set-off under rule 6, set up, by way
2017 SCC Online Kar 1084
of counter-claim against the claim of the plaintiff,
any right in respect of a cause of action accruing
to the defendant against the plaintiff either
before or after the filing of the suit but before the
defendant has delivered his defence or before the
time limited for delivering his defence has
expired, whether such counter-claim is in the
nature of claim for damages or not:
Provided that such counter-claim shall not
exceed the pecuniary limits of the jurisdiction of
the Court.
(2) Such counter-claim shall have the same effect as
a cross-suit as to enable the Court to pronounce
a final judgment in the same suit, both on the
original claim and on the counter-claim.
(3) The plaintiff shall be at liberty to file a written
statement in answer to the counter-claim of the
defendant within such period as may be fixed by
the Court.
(4) The counter-claim shall he treated as a plaint and
governed by the rules applicable to plaints."
85. A bare perusal of Order VIII, Rule 6A of the CPC
clearly reveals that the counter-claim is to be filed
"against the claim of the plaintiff". It can be filed with
regard to "any right or cause of action accruing to the
defendant", but "against the plaintiff. That the counter-
claim can be filed only "against the plaintiff" is further
borne out by Or. VIII, Rules 6B to 6F of the CPC. Thus,
the counter-claim cannot be filed against any other
person or entity who is not the plaintiff. It is, indeed, trite
to state that the purpose of permitting a counter-claim to
be filed in a suit is to lessen multiplicity of litigation.
Since the suit and the counter-claim are to be tried
together, the common trial permits the same court to
decide the issues which may not only be common, but
also may be proved by same or similar evidence.
Therefore, the counter-claim can be filed only qua the
plaintiff. Of course, it is true that through the counter-
claim the defendant is permitted to raise other cause of
action, besides the ones raised by the plaintiff. But
nonetheless, the focus of the other cause of action still
has to be "against the plaintiff", and not against others."
(Emphasis supplied)
The learned Judge holds that the counter claim against the
defendant no doubt can be made, but the cause of action and focus
should still be against the plaintiff and not the other co-defendant.
9.3. The Apex Court in the case of RAJUL MANOJ SHAH v.
KIRANBHAI SHAKRABHAI PATEL7, after considering ROHIT
SINGH and the law on the issue has held as follows:
".... .... ....
17. Re: Defendant no. 2's claim of specific relief not
maintainable against appellant: Ld. Sr. Counsel for the
appellant has argued that in terms of Order VIII Rule 6A of CPC,
a counter-claim must be filed seeking relief against the plaintiff
and cannot be filed against a co-defendant, for a counter-claim
must necessarily deal with the defendant's cause of action
against the plaintiff. On the other hand, Ld. Counsel for the
respondent submits that the counter-claim seeks two
substantive reliefs, namely, partition and specific performance.
Consequently, it is contended that the counter-claim is not
directed solely against a co-defendant, for, in an independent
suit seeking the very same reliefs, the appellant would
necessarily have to be impleaded as a party. The ultimate relief
sought by defendant no. 2 is a declaration of co-ownership of
the deceased sister-in-law of plaintiff and a consequent decree
of specific performance as against that ownership on the basis
of the agreement of sale.
2025 SCC Online SC 1958
18. Order VIII, Rule 6A, CPC enables a defendant to set
up a counter-claim. Said provision is extracted as below;
6A. Counter-claim by defendant.--(1) A
defendant in a suit may, in addition to his right of
pleading a set-off under rule 6, set up, by way of
counter-claim against the claim of the plaintiff, any right
or claim in respect of a cause of action accruing to the
defendant against the plaintiff either before or after the
filing of the suit but before the defendant has delivered
his defence or before the time limited for delivering his
defence has expired, whether such counter-claim is in
the nature of a claim for damages or not:
Provided that such counter-claim shall not exceed
the pecuniary limits of the jurisdiction of the court.
(2) Such counter-claim shall have the same effect as
a cross-suit so as to enable the Court to
pronounce a final judgment in the same suit,
both on the original claim and on the counter-
claim.
(3) The plaintiff shall be at liberty to file a written
statement in answer to the counter-claim of the
defendant within such period as may be fixed by
the court.
(4) The counter-claim shall be treated as a plaint and
governed by the rules applicable to plaints.
(emphasis supplied)
19. As per Rule 6-A(1), a defendant may assert any
right or claim against the plaintiff before the filing of the
written statement, even if such cause of action is
unrelated to the plaintiff's suit. The only limitation is that
the counter-claim must lie within the pecuniary
jurisdiction of the court. Such a counter-claim is treated
as a cross-suit and is governed by the rules applicable to
plaints, including the obligation to disclose the cause of
action and pay requisite court fees. The legislative intent
is to avoid multiplicity of proceedings by allowing both
the original suit and the counter-claim to be tried and
disposed of in a single trial, thereby avoiding prolonged
and protracted litigation as held in Jag Mohan
Chawla v. Dera Radha Swami Satsang.
20. Rule 6A provides that counter-claim shall be
against the claim of the plaintiff and such right or claim
shall be in respect of cause of action accruing to
defendant against the plaintiff. This Court in Rohit
Singh (supra) held;
"21. Normally, a counterclaim, though based
on a different cause of action than the one put in
suit by the plaintiff could be made. But, it appears
to us that a counterclaim has necessarily to be
directed against the plaintiff in the suit, though
incidentally or along with it, it may also claim
relief against the co-defendants in the suit. But a
counterclaim directed solely against the co-
defendants cannot be maintained. By filing a
counterclaim the litigation cannot be converted
into some sort of an interpleader suit....."
21. The above observations have been reiterated with
approval in subsequent pronouncement in DamodharNarayan
Sawale v. Tejrao Bajirao Mhaske, by observing as under;
"39. The decision of this Court in Rohit
Singh v. State of Bihar also assumes relevance in the
above context. This Court held that a defendant could
not be permitted to raise counterclaim against co-
defendant because by virtue of Order 8 Rule 6-A CPC, it
could be raised by the defendant against the claim of
the plaintiff."
22. In the present case, defendant no. 2 sought to raise a
counter-claim primarily for the relief of specific performance of
agreement dated 21.10.2011 executed in his favour by
deceased original defendant no. 1 with respect to her undivided
share in the suit property, by a direction to the Nazir, the
substituted representative of defendant no. 1, to execute a sale
deed in pursuance of the agreement to sell. The relief of
specific performance as sought to be raised by defendant
no. 2 cannot be set up by way of a counter-claim since
the same is not directed against the appellant/plaintiff,
but is instead directed solely against the co-defendant. In
view of this, defendant no. 2 is held to be disentitled to
raise prayer of specific performance by way of counter-
claim. This is simply not permissible, and this position is
no more res-integra in view of the decision of this Court
in Rohit Singh (supra).
23. Defendant no. 2 however submits that he has not
only claimed the relief of specific performance, but has also
sought partition of suit property to separate the share he is
entitled to under the agreement. Defendant must first establish
a right of claim over the property, which is absent9 till he
succeeds against the estate of defendant no. 1 and only
thereafter that the question of setting up a counter claim
against plaintiff may arise. Thus, the submission that there is
also a claim for partition must fail for the same reason."
(Emphasis supplied)
9.4. A meticulous examination of the Authorities is
indispensable to resolve the present controversy. The Apex Court
in the case of ROHIT SINGH supra holds that a counterclaim by its
very nature, is a defendants' actionable claim against the plaintiff
and ordinarily cannot be an independent claim against the co-
defendant. The Apex Court observes that permitting such cross-
litigation within the same suit would distort the procedural fabric of
the lis and blur the roles of the plaintiff/s and the defendant/s. In
ASHOK KUMAR SHARMA, the Punjab and Haryana Court adopted
a similar view. It reaffirmed that a counterclaim directed
exclusively against the co-defendant is not maintainable. On a
plain reading of Order VIII Rule 6-A of CPC contemplates a
counterclaim against the plaintiff and not inter se between the
defendants. The legal position as enunciated in the case of ROHIT
SINGH is reiterated in RAJUL MANOJ SHAH, but with a degree of
refinement. The Apex Court in RAJUL MANOJ SHAH considers the
purpose and sweep of Order VIIII Rule 6-A CPC. The Apex Court
holds that, while it is true that a counter claim is primarily intended
as a defendant/s claim against the plaintiff, the mere fact that
reliefs sought against the plaintiff incidentally or necessarily affect a
co-defendant, or incidentally touches upon the claim of the plaintiff,
such counterclaim would not become contrary to law. It is trite that
the counterclaim substantially concerns or implicates the plaintiff.
If the counter-claim so filed against a co-defendant implicates or
concerns the plaintiff and not solely the co-defendant, the said
counterclaim does not vitiate its maintainability. What is
impermissible in law is a counterclaim exclusively against a
co-defendant, one that bears no nexus to the plaintiff's claim
or the lis between the plaintiff and the defendants.
9.5. The Apex Court in the case of RAJUL MANOJ SHAH
supra considers the judgment in the case of ROHIT SINGH supra
and holds that defendant No.2 sought to raise a counterclaim
primarily for relief of specific performance of agreement dated 21-
10-2011 executed in favour of defendant No.1. The Apex Court
after looking into the written statement so set up observes that the
relief of specific performance as sought to be raised by defendant
No.2 cannot be set up by way of counterclaim, since the same was
not directed against the plaintiff but instead directed solely against
the co-defendant. In that view, the 2nd defendant therein was held
to be disentitled to raise a prayer of specific performance by way of
a counter claim against the co-defendant.
9.6. When the present counterclaim is scrutinized through the
prism of ROHIT SINGH and RAJUL MANOJ SHAH, it becomes
evident that the reliefs sought by the 1st defendant in the
counterclaim is not in isolation to counter the plaintiff's claim,
rather it is interwoven with the obligations arising out of a tripartite
agreement and consequent rights asserted by the plaintiff. The
allegations and the relief are interconnected; they relate to the
contractual matrix governing the loan transaction, the construction
agreement and the tripartite agreement, all of which are central to
the plaintiff's suit. The agreement was between the Bank, the
developer and the home buyer. The developer has sold it to the 3rd
defendant. Now, by way of counterclaim defendant No.1 seeks to
annul the sale deed made in favour of defendant No.3 as null and
void. In the said counterclaim, the prayer is not restricted to
declaration of sale deed in favour of defendant No.3 as null and
void, but compensation is sought against the plaintiff and defendant
No.2 jointly and severally and declaration of obligations against
defendant No.2 under the agreements to be null and void.
Therefore, the counterclaim does touch upon claim against the
plaintiff and does not entirely relate to the co-defendant.
9.7. If a suit for specific performance is sought at the hands
of the co-defendant, it would have been an altogether different
circumstance. The prayer is sought against the plaintiff and the co-
defendant in the counterclaim. The concerned Court, at paragraphs
15 and 16, quotes the prayer in the counterclaim. On a bare
perusal of the prayer, it is clear that the counterclaim is not only
directed against the co-defendant, but is also against the
plaintiff/HDFC Bank as well. Therefore, no fault can be found with
the order so passed by the concerned Court, simply for the reason
that, both in ROHIT SINGH and RAJUL MANOJ SHAH the Apex
Court holds that the counterclaim has to be directed towards the
plaintiff and may incidentally be made against the defendants.
Therefore, I answer the issue holding that generally Order
VIII Rule 6A is a complete bar for a counter claim to be
raised solely against the co-defendant, but if the relief
sought in the counterclaim would touch upon the claim
against the plaintiff as well, it cannot be held to be barred. In
the case at hand, the prayer in the counterclaim of the 1st
defendant clearly indicates several facts against the plaintiff as well.
The commercial Court, while dismissing the applications under
Order VII Rule 11 CPC, has applied the test correctly. As
observed, the counterclaim in its substance and character is
not an isolated claim between defendants inter se. It is
inextricably linked to the plaintiff's cause of action and the
composite contractual obligations binding the parties. Upon
such consideration, this Court finds no infirmity in the reasoning of
the Commercial Court. The issue is answered holding that the
counterclaim as framed, is maintainable and does not warrant
rejection under Order VII Rule 11 CPC.
10. Finding no merit in the petitions, the petitions stand
rejected.
Interim order, if any subsisting, shall stand dissolved.
Sd/-
(M.NAGAPRASANNA)
JUDGE
BKP
CT:MJ
