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B.L.M.S. Hotel & Resort Pvt. Ltd. & Others v/s Tej Bhan Chnghani & Others

    Civil Revision No. 472 of 2014
    Decided On, 12 November 2014
    At, High Court of Judicature at Allahabad
    For the Appellants: Arvind Srivastava & Pushkar Srivastava, Advocates. For the Respondents: Krishna Agrawal, Advocate.

Judgment Text
1. Heard Sri Arvind Srivastava and Sri Krishna Agrawal, learned Counsel for the respective parties and with their consent I proceed to decide the revision finally at the stage of admission itself. This revision under section 115, C.P.C. has been preferred against the order dated 29.8.2014 passed by the Court of first instance in Original Suit No. 344 of 2012 by which the application of the revisionists paper No. 45C for framing additional issue No. 10 in the suit has been rejected.

2. The brief facts giving rise to this revision are that the plaintiff respondent No. 1 instituted the aforesaid original suit against the defendant revisionists and one Chandra Shekhar Agrawal for recovery of Rs. 7,81,500/- on the allegation that they have borrowed a sum of Rs. 5,15,000/- from him but has not returned the same which is liable to be refunded with 18% interest. It was also alleged that the aforesaid amount after borrowing was deposited in the bank account of the company BLSM Hotel and Resorts Private Limited.

3. In the said suit several issues were framed and some of the issues including issue No. 8 relating to jurisdiction of the Civil Court were decided on 9.12.2013 as preliminary issues holding that the suit is cognizable by the Civil Court.

4. Subsequently, defendant revisionists applied for amendment of the written statement which was allowed to be amended vide order dated 7.8.2014. The amendment permitted the defendant revisionists to plead that the suit is barred by section 10(g)(b) and 133(2) of the Companies Act, 1956 (hereinafter referred to as the Act).

5. After the said amendment defendant revisionists moved application 45C for framing an additional issue that the suit is not maintainable and is barred by section 10(g)(b) and 133(2) of the Act.

6. The application was opposed on the ground that the issue of jurisdiction had already been decided on 9.12.2013 and therefore there is no necessity of framing any additional issue to the above effect.

7. The Court below by the impugned order has rejected the application holding that the issue regarding jurisdiction had already been decided which has attained finality. Therefore, there is necessity to formulate an issue on the above aspect at this stage.

8. In challenging the above order it has been submitted that the issue of jurisdiction was different from the issue that the suit is barred by section 10(g)(b) and 133(2) of the Act proposed to be framed. Secondly, the order dated 9.12.2013 deciding issue No. 8 of jurisdiction would not come in the way of framing additional issue, in as much as, the said issue framed and decided was on the basis of the then existing pleadings whereas the position has changed with the amendment of the written statement.

9. The revision has been opposed on the preliminary point that it is not maintainable. On merits it is contended that the issue proposed to be framed is virtually of no use, as section 10(g)(b) of the Act has not come into operation as no notification constituting a National Company Law Tribunal has been issued, the issue of jurisdiction has already been decided and the framing of issue on the above aspect would amount to giving second inning to the defendant revisionists to contest on the same issue which had been decided.

10. I first deal with the preliminary objection regarding maintainability of the revision.

11. An order passed in a suit is revisable by virtue of section 115, C.P.C. which in its applicability to the State of U.P. reads as under:

"215. Revision.--

(1) A Superior Court may revise an order passed in a case decided in an original suit or other proceeding by a Subordinate Court where no appeal lies against the order and where the Subordinate Court has-

(a) exercised a jurisdiction not vested in it by law; or

(b) failed to exercise a jurisdiction so vested; or

(c) acted in exercise of its jurisdiction illegality or with material irregularity.

(2) A revision application under sub-section (1), when filed in the High Court, shall contain a certificate on the first page of such application, below the title of the case, to the effect that no revision in the case lies to the District Court but lies only to the High Court either because of valuation or because the order sought to be revised was passed by the District Court.

(3) The Superior Court shall not, under this section, vary or reverse any order made except where-

(i) the order, if it had been made in favour of the party applying for revision, would have finally disposed of the suit or other proceedings; or

(ii) the order, if allowed to stand, would occasion a failure of justice or cause irreparable injury to the party against whom it is made.

(4) -----------

Explanation-I. -- -----

(i) -------------------

(a) ---------------

(b) ----------------

(ii) -----------------

The above provision authorizes the Superior Court to revise an order of the Court subordinate to it on fulfillment of the following conditions:

(i) order must be passed in" a case decided" in an original suit;

(ii) no appeal should lie against it;

(iii) the Subordinate Court has erred in exercise of its jurisdiction; and

(iv) the order if allowed to stand, would occasion failure of justice;

12. The Superior Court however, would not vary or reverse the order of the Subordinate Court, if the order has the effect of finally disposing of the suit or the proceedings.

13. The first condition for revising an order under section 115, C.P.C. is that the order must be "a case decided". The word 'case' has no where been defined but it has a wider meaning than the 'suit' or 'appeal'. A case is decided when there is an adjudication on the rights and obligation of the parties to the suit by an order or which may have the necessary effect of deciding those rights or obligations. An order which terminates a part of controversy involving the question of jurisdiction is also an order deciding the case.

14. Order XIV, C.P.C. provides for the settlement of issues. It lays down that when material proposition of fact or law is affirmed by one party and denied by the other, issues arises for adjudication. The issues so arising in a suit are settled by the Court on the basis of the allegations made in the pleadings, answer to interrogatories, allegations made on oath by parties, their agents or pleaders and the contents of documents produced by either parties.

15. Rule 5 of Order XIV, C.P.C. authorizes the Court to amend the issues or frame additional issues for determining the matters in controversy before passing a decree in a suit. At the same time, Rule 2 of Order XIV, C.P.C. obliges the Court to pronounce judgments on all issues settled in the suit.

16. In view of the provisions contained in Order XIV, C.P.C. settlement of issues in a suit is an important aspect. The controversy involved in the suit revolves around the issues only. The issues tells the parties the points which are in controversy and are proposed to be decided. In case, any point is left out for any reason, the Court can always frame an issue on it and decide the same to settle all controversies between the litigating parties.

17. Thus, the framing of issues and additional issues is an essential step for deciding the suit and all controversies between the parties. An order refusing to frame an issue virtually have the effect of denying to decide the essential rights and obligations of the parties and as such would be a case decided. It terminates a particular stage of the suit.

18. In K.S. Sivadas Vs. Lakshmi and K.S. Jayapalan, it was held that the order refusing to frame issues or additional issues is a "case decided" and hence the revision is maintainable.

19. The Punjab and Haryana High Court in Joginder Pal Vs. Raj Rani, held that revision against the order refusing to frame an additional issue is maintainable.

20. The Allahabad High Court in Bhagwati Shanker Srivastava and others v. VIII Additional Munsif and other 1996 All CJ 5 held that an order of the Appellate Court framing an issue and remitting it for trial to the Lower Court was held to be a case decided.

21. In view of the above legal position refusal to frame additional issue amounts to a case decided for the purposes of maintaining a revision under section 115, C.P.C. against such an order.

22. The second condition for maintaining a revision against an order passed by the Court of first instance in a suit is to see if the order is appellable or not.

23. Section 104, C.P.C. provides for appeals against interlocutory orders of the Trial Court and Order XLIII, Rule 1, C.P.C. specifies the nature of the interlocutory orders which are appellable. No appeal is provided under order XLIII, Rule 1, C.P.C. against an order of the Trial Court allowing or refusing to frame issue or additional issue in a suit. Therefore, it is not an appellable order.

24. Now coming to the third condition, Order XIV, C.P.C. permits the Court of first instance to frame issues which arises for determination on the basis of the pleadings exchanged between the parties and obliges the Court to pronounce the judgment on such issues formulated.

25. Rule 5 of Order XIV, C.P.C. empowers the Court to amend and strike out the issues which have been settled in a suit. The said power includes the power to frame additional issues also. This power is exercisable for determination of all matters in controversy between the parties. Therefore, it is obligatory upon the Court of first instance to frame issues as are necessary for determining the real controversy between the parties which may arise on the basis of the pleadings and in case the Court refuses to settle an issue which is necessary, it certainly fails to exercise the jurisdiction vested in it under law. Thus, non framing of additional issue which is necessary results in failure to exercise jurisdiction by the Court concerned and as such is revisable.

26. The issues in the suit which were settled earlier were on the basis of the then existing pleadings. There is no dispute that subsequently the written statement was allowed to be amended and a plea that the suit is barred by section 10(g)(b) and 133(2) of the Act was permitted to be incorporated. Therefore, with the amendment of the written statement if it appears that some new controversy had arisen, it is necessary to settle an issue on the said aspect. The non framing of the issue despite amendment of the written statement would render the amendment of the pleadings an exercise in futility.

27. Accordingly, the refusal to frame an issue in view of the amended pleadings would occasion failure of justice and therefore it is but necessary to challenge the impugned order.

28. In view of the aforesaid facts and circumstances, all the essential ingredients as observed above for the purpose of filing a revision stands satisfied.

29. Above all, the order impugned, if varied or reversed, would not have the effect of finally disposing of the suit. In the above facts and circumstances I am of the view that the revision is maintainable. Accordingly, the preliminary objection raised is over ruled.

30. Now coming on the merits as to whether an additional issue as proposed ought to be framed or not, it is important to note that the necessity to formulate the above issue for adjudication by the Court below arose on account of amendment permitted by the Court below in the written statement. The issue earlier framed regarding jurisdiction was as under:

31. The aforesaid issue No. 8 was decided on 9.12.2013 in favour of the plaintiff and against the defendant respondents holding that they have failed to adduce any material or to show as to how the Court has no jurisdiction without reference to any provision of law. Subsequently, the written statement was amended on 7.8.2014 and the plea of suit being barred by section 10(g)(b) and 133(2) of the Act was permitted to be raised. On the amendment of the written statement the following issue was proposed to be added:

32. The proposed issue apart from raising the question of jurisdiction questions the maintainability of the suit

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in view of above referred two provisions of the Act. The maintainability of the suit and the jurisdiction of the Civil Court are two separate matters. The Court may have decided the question of jurisdiction earlier but the question regarding the maintainability of the suit or whether the suit is barred by section 10(g)(b) and 133(2) of the Act was never decided. 33. The aforesaid question is a relevant and important issue which may ultimately fail or succeed but since it has arisen on the amendment of the pleadings, the Court in exercise of powers under Rule 5 Order XIV, C.P.C. has ample authority in law to frame an additional issue on the said aspect. 34. In view of the aforesaid facts and circumstances, I find that the Court below has failed to exercise the jurisdiction vested in it under law by not framing the additional issue as proposed. 35. Accordingly, the order dated 29.8.2014 is hereby set aside and the application of the defendant revisionists paper No. 45 C-2 is allowed in part and the following additional issue as issue No. 10 is settled for adjudication by the Court below: 36. The Court below is directed to proceed and decide the suit as a whole in accordance with law as expeditiously as possible curtailing all unnecessary adjournments and fixing short dates in quick succession. The revision is allowed. No order as to costs.