Madras High Court
M/S.Digital Data Forms (P) Ltd vs M/S.Integrated Finance Company ... on 23 February, 2022
O.S.A. (CAD) Nos.163, 165 & 166 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 23.02.2022
CORAM
THE HONOURABLE MRS. JUSTICE PUSHPA SATHYANARAYANA
AND
THE HONOURABLE MRS.JUSTICE S.KANNAMMAL
O.S.A.(CAD).Nos.163, 165 and 166 of 2021
and C.M.P.No.7312 of 2020
M/s.Digital Data Forms (P) Ltd.
Represented by its Director
Mr.S.B.P.S.Krishna Mohan,
No.88, Commander-in-Chief Road,
Egmore, Chennai-600105. ... Appellant in all appeals/
Applicant/Defendant No.1
Vs.
M/s.Integrated Finance Company Limited
Vairams,
No.112, Thyagaraya Road,
T.Nagar, Chennai-600 017. ... Respondent in all appeals/
Respondent/Plaintiff
***
Prayer : Original Side Appeals filed under Clause 15 of Letters Patent
and Section 13(1A) of the Commercial Courts Act against the fair and
decreetal order/judgment dated 17.08.2021 made in A.Nos.2660, 2661,
2662 and 2663 of 2021 in C.S.No.839 of 2007 respectively.
***
For Appellant in : Mr.K.Bijai Sundar
all the appeals for Mr.K.K.Muralidharan
For Respondent : Mr.V.P.Raman
in all the appeals
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
COMMON JUDGEMENT
PUSHPA SATHYANARAYANA, J.
Aggrieved by the order dated 17.08.2021 passed in Application
Nos.2660 to 2663 of 2021 in C.S. No.839 of 2007, the first defendant in
the suit has filed these original side appeals.
2. The suit was filed by the respondent herein for recovery of a
sum of Rs.1,92,94,535.15, which is a due payable by the appellant in
Hire Purchase Agreement dated 30.03.1996. The trial of the suit was
over and it was posted for arguments. At that stage, the appellant
herein/first defendant, filed Application Nos.2660 to 2663 of 2021,
under Order XVIII Rule 27 of CPC, seeking permission to reopen the
case, to recall PW1 and to file additional documents. The document that
is sought to be marked is the statement of accounts for the Hire
Purchase Agreement No.456, which is the basis for the suit and also the
payment receipt for another agreement, which is Hire Purchase
Agreement No.67. The reasons stated in the affidavit filed in support of
these applications are that the plaintiff has suppressed the existence of
Hire Purchase Agreement No.67 and the payments made towards the
discharge of the said Hire Purchase Agreement. Since the plaintiff had
suppressed the payments made by the defendants, the appellant is now
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
seeking to mark the statement of accounts, which was issued by the
plaintiff to the appellant.
3. The applications were contested by the plaintiff contending that
by producing these documents, the first defendant/appellant, wanted to
withdraw the earlier stand taken in the written statement.
4. We have heard the learned counsel appearing for the appellant
and the learned counsel appearing for the respondent and perused the
materials available on record.
5. Admittedly, the suit is for recovery of money based on Hire
Purchase Agreement No.456, which has got nothing to do with the Hire
Purchase Agreement No.67. Therefore, the learned single Judge had
dismissed these applications stating that the production of those
documents either necessary or proper for determining the dispute in the
suit. Aggrieved by the said order, the above appeals are preferred.
6. Though the suit was filed prior to the constitution of the
Commercial Division, the orders impugned before us, is passed by the
Commercial Division after its constitution. Therefore, whether an appeal
under Section 13 of the Commercial Courts Act, 2015 is maintainable,
has to be seen.
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
7. The learned counsel appearing for the respondent would
contend that these appeals are not maintainable, as the order impugned
did not fall within the category of orders enumerated under Order XLIII
of the Code of Civil Procedure, 1908.
8. Section 13 of the Commercial Courts Act, 2015, deals with
appeals from decrees of commercial courts and commercial division,
which reads thus:
13. Appeals from decrees of Commercial Courts and
Commercial Divisions.—(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).
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(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 provi sions of this Act.
The above proviso to Section 13 categorically states that, an appeal
would lie from such order passed by the Commercial Division only those
that are specifically mentioned in Order XLIII of the CPC.
9. As stated earlier, the applications are filed under Order XVIII
Rule 17 CPC to reopen, recall and receive additional documents. A look
at Order XLIII shows that no appeal is provided for against any order
passed under Order XVIII Rule 17 CPC.
10. The learned counsel appearing for the appellant placed his
reliance on a decision of the Division Bench of this court in
Rubinetterie Bresciane Bonomi SpA vs. Lehry Instrumentation &
Valves Pvt. Ltd. reported in 2019(4) CTC 188, wherein, the Division
Bench at paragraph Nos.19 to 21, held as under:
19. To sum it up:
(a) A right of appeal under Clause 15 of the Letters
Patent is available from all Orders passed in any proceedings
in any suit pending on the date of commencement of
Commercial Courts Act.
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
(b) So far as the present two appeals (of which one is
yet to be taken on record) are concerned, since they do not
constitute 'judgments' within the meaning of Clause 15 of the
Letters Patent, no appeal is maintainable against them.
20. In the course of his arguments, the learned counsel
for the appellant has submitted that the evidence, both
documentary and oral that are now produced and rejected,
are essential to defend the suit C.S.891 of 2015 instituted by
the respondent. But then, that necessity opens only when the
respondent discharges its burden in its suit, and it depends on
the quality of evidence that the respondent may chose to
produce in aid of the cause of its action. May be, for
procedural convenience, the appellant might have anticipated
it and might have attempted to produce some contra evidence
perhaps without anything substantial to counter at this
moment. That, at any rate cannot take away the appellant's
right to defend an action when the respondent in its suit
actually discharges its initial burden. And, the Orders now
impugned cannot preempt what might arise in future, as
there cannot be any anticipatory foreclosure of the right to
lead in evidence that may not endanger or offend the right to
defend an action in a manner in which the adversarial
jurisprudence that we have adopted has come to recognise
and accept. That then is sure to leave serious consequences.
Necessarily the appellant's right to produce all the evidence
that is under its command to produce in defence of
respondent's action will remain preserved, and it will be at
liberty to produce them, if so required and felt necessary.
21. To conclude, O.S.A. No.252 of 2018 is not
maintainable, not because the appeal is not maintainable
under the Commercial Courts Act, but because the Order
impugned does not qualify for an appeal under Clause 15 of
the Letters Patent, and is hence dismissed. Since the other
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
appeal which is yet to be taken on record in O.S.A. SR.33496
of 2018 faces an identical consequence, this Court chooses to
not condone the delay, and accordingly C.M.P.No.12023 of
2018 filed therein is dismissed. No costs. Consequently,
connected miscellaneous petition is closed.
In the above case, the appeal was preferred in the year 2018 under
clause 15 of the Letters Patent challenging the order passed in the year
2017 on the Original Side of the Madras High Court on 24.07.2017,
whereas the Commercial Division of the Madras High Court was
constituted on 29.11.2017. Hence after constitution of the Commercial
Division, the appeal was not entertained, as the order impugned, did not
qualify for an appeal under Clause 15 of the Letters Patent and hence it
was dismissed.
11. The next judgment that was relied on by the learned counsel
for the appellant is Kapoor Imaging Pvt Ltd vs. Kodak India Pvt.
Ltd. dated 05.02.2020 made in O.S.A. Nos.13 to 15 of 2020,
wherein the Division Bench of this court at paragraph Nos.7 and 8, held
as under:
"7.Order 11 Rule 1(5) and Order 11 Rule 7 C.P.C. also
do not prevent the appellant from seeking appropriate relief.
If we see Order 11 Rule 1(5) C.P.C., it speaks about the
appeal filed at the first instance. Secondly, Order 11 Rule 7
C.P.C. makes the position clear that certain provisions shall
not be applicable to the suits or applications before the
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Commercial Court. Even assuming that this sub rule is
applicable, the power under Section 15 of the Act cannot be
taken away. This we hold notwithstanding our view that the
right available under the Code of Civil Procedure to a plaintiff
in a suit which has been transferred subsequently cannot be
taken away when a right is substantive in nature. The right for
claiming relief is substantive and therefore not procedural.
8.Having held that the applications are maintainable,
we find that even on merit, the order requires to be interfered
with. Learned single Judge applied the rigours of the Act. The
suit itself is one for recovery of money on the claim of
damages. Now, there is a counter claim. The transfer itself
has been effected during the fag end of the year 2018. The
issues have been framed only on 17.09.2019."
12. However, in a subsequent appeal by the same appellant in
Kapoor Imaging Pvt Ltd vs. Kodak Polychrome Graphics Asia
Export Private Limited & Others reported in 2021 (3) CTC 871,
which was relied on by the learned counsel for the respondent, the
Division Bench found that the orders impugned were passed by the
Commercial Division and the right of appeal is governed by Section 13
of the Commercial Courts Act and the appeals were not maintainable, as
the orders did not fall within the category of orders specified in Order
XLIII of the CPC. In the said judgment, the Division Bench of this court,
in paragraph Nos.40 and 41, held as under:
40. Section 13 of the CCA deals with “appeals from
orders“ or “decrees“ of “Commercial Courts and Commercial
Divisions“. Sections 13 (1) and 13 (1A) provides that “any
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
person“ who is aggrieved by a judgment or order of the
Commercial Court, can prefer an appeal. But, it does not
provide the nature of orders that would be appealed against.
The proviso to Sections 13(1) and 13(1~A) of CCA indicates
that an “appeal“ shall lie from such of those orders passed by
a Commercial Division or a Commercial Court that are
specifically enumerated thereunder, namely (i) Order 43 of
CPC as amended by the Commercial Courts Act and (ii) Section
37 of the Arbitration and Conciliation Act, 1996.
41. In the instant case, the order was passed by the
learned Single Judge in a transferred suit, which was
originally filed before the Original side of this Court, and
subsequently transferred to the Commercial Division of this
Court. The proceedings were governed by Section 15 (1) of
the CCA, 2015. As per sub~clause (5) to Section 15, the
provisions of the Act will apply to those proceedings that were
not complete at the time of transfer. These appeals were not
filed under Order 43 Rule 1 of CPC. It has been filed under
Order 36 Rule 1 of the Original Side Rules of this Court, read
with Clause 15 of the Letters Patent.
13. The learned counsel for the respondent produced yet another
judgment passed in Aarur Tamilnadan vs. S.Shankar and others
made in O.S.A. Nos.15 to 18 of 2021 dated 08.07.2021, wherein the
First Bench of this Court held as under:
"3......Though Section 13 (1A) permits any person
aggrieved by a judgment or order of the Commercial Division
of the High Court to prefer an appeal before the Commercial
Appellate Division of that High Court, the proviso to such sub-
section limits the scope of the appeal and confines the appeals
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
to such matters and nature of orders as are “specifically
enumerated under Order XLIII of the Code ...“. To boot,
Section 13 (2) of the Act mandates as follows:
“(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.“
Thus, the body of the jurisprudence that had developed as
regards appellability under Clause 15 of the Letters Patent
becomes redundant in commercial suits. The effect of Section
13 (2) of the Act is that appeals previously provided in respect
of orders in suits filed on the Original Side of this Court would
no longer be maintainable since Clause 15 of the Letters
Patent would not apply if the suit was a commercial suit and
only Order XLIII of the Code would be applicable.
4. Since the nature of the application in the present
case is not one which is enumerated in Order XLIII of the Code
as being appellable, the present appeal in the commercial suit
is not maintainable under Section 13 of the Act of 2015 which
has to be seen as the only repository of judgments and orders
against which appeals may be carried, since the right to prefer
an appeal under the Letters Patent has been done away with
in the provision.
From the above referred judgments, it is very clear that unless it is
already provided for under Order XLIII, the appeals will not be
maintainable under Section 13 of the Commercial Courts Act, 2015.
14. In Kandla Export Corporation and Another vs. OCI
Corporation and Another reported in (2018) 14 SCC 715, the
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Hon'ble Supreme Court held that Section 13(1) of the Commercial
Courts Act, is in two parts. The main provision is 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.
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.
15. The judgment has further categorically held that an appeal
shall lie from such orders passed by the Commercial Division of the High
Court that are specifically enumerated in Order XLIII of the Civil
Procedure Code, 1908 and Section 37 of the Arbitration Act. Those
orders that are not specifically enumerated in Order XLIII CPC, would,
therefore be not appealable.
16. In the light of the above judgments, we have to hold that the
applications are not appealable under Order XLIII of the Civil Procedure
Code, 1908 and hence the appeals filed under the Letters Patent are
also not maintainable. It is also not out of place to mention that
subsequent to these applications, which were dismissed, the appellant
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seems to have filed Application Nos.4632 to 4634 of 2021 in C.S.
No.839 of 2007, to reopen the evidence on the side of the defendants,
to recall DW1 and to receive 16 additional documents, which were also
dismissed on 12.01.2022, with cost. As Commercial Division cannot
entertain applications for a not justifiable cause and there is no
explanation on the part of the appellant for the delay in filing of the
applications, the learned single Judge had rightly dismissed the
applications.
17. Accordingly the Original Side Appeals are also dismissed as not
maintainable. Consequently, the connected civil miscellaneous petitions
are closed.
(P.S.N., J.) (S.K., J.)
23.02.2022
Index : Yes / No
Internet: Yes
Asr
Copy to :
The Section Officer,
Original Side,
Madras High Court.
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O.S.A. (CAD) Nos.163, 165 & 166 of 2021
PUSHPA SATHYANARAYANA, J.
AND
S.KANNAMMAL, J.
Asr
O.S.A.(CAD) Nos.163, 165 & 166 of 2021
& C.M.P.No.7312 of 2020
23.02.2022
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