Should Proceedings In New Court Where 'Returned' Plaint Is Filed Be Started De Novo? SC Refers To Larger Bench [Read Order]

Should Proceedings In New Court Where

"We see no justifiable reason why the proceedings which may have taken place in a Court even if it has no jurisdiction, cannot be transferred to the new Court having jurisdiction."

Whether after a plaint is returned in terms of Order VII Rule 10 and Rule 10A, Code of Civil Procedure (CPC), should the trial in the Court where the plaint is now filed start de novo or from such stage at which the plaint was ordered to be returned? The Supreme Court has referred this issue to larger bench.

In M/S EXL Careers vs. Frankfinn Aviation Services Pvt. Ltd, the bench comprising Justice Deepak Gupta and Justice Aniruddha Bose made this reference after it noticed apparent conflict between the judgment in Oil and Natural Gas Corporation Ltd.v. Modern Construction and Joginder Tuli vs. S. L. Bhatia.

Modern Construction [(2014) 1 SCC 648]

In this judgment, it was held that, in such a situation, after presentation before the court of competent jurisdiction, the plaint is to be considered as a fresh plaint and the trial is to be conducted de novo even if it stood concluded before the court having no competence to try the same. It was thus observed:

If the court where the suit is instituted, is of the view that it has no jurisdiction, the plaint is to be returned in view of the provisions of Order 7 Rule 10 CPC and the plaintiff can present it before the court having competent jurisdiction. In such a factual matrix, the plaintiff is entitled to exclude the period during which he prosecuted the case before the court having no jurisdiction in view of the provisions of Section 14 of the Limitation Act, and may also seek adjustment of court fee paid in that court. However, after presentation before the court of competent jurisdiction, the plaint is to be considered as a fresh plaint and the trial is to be conducted de novo even if it stood concluded before the court having no competence to try the same.

Joginder Tuli [ (1997) 1 SCC 502]

In this case, the Supreme Court upheld the order of the High Court which directed that the case be taken up at the new Court and proceeded from the stage at which it was returned by observing thus:

Normally, when the plaint is directed to be returned for presentation to the proper Court perhaps it has to start from the beginning but in this case, since the evidence was already adduced by the parties, the matter was tried accordingly. The High Court had directed to proceed from that state at which the suit stood transferred. We find no illegality in the order passed by the High Court warranting interference

Modern Construction Need Reconsideration

The bench, in the instant case, opined that the judgment in Modern Construction needs reconsideration

The court, however, noted that in Joginder Tuli case (supra), the Court had jurisdiction when the plaint was filed whereas in the present case, the Court, where the plaint is filed, did not have jurisdiction even when the plaint was filed.

In our view, this will not make any difference in so far as the powers conferred on Court under Order VII Rule 10 and 10A of CPC are concerned. While sub-rule (1) of Rule 10 of Order VII envisages that a plaint can be returned at any stage of the suit to be presented to the Court in which the suit should have been instituted, the explanation thereto provides that the power of return of plaint can be exercised even by an appellate court or a revisional court after setting aside the decree passed in the Court. Order VII Rule 10A provides that where in any suit, after the defendant has appeared, the Court is of the opinion that the plaint should be returned, the plaintiff may make an application specifying the Court in which he proposes to present the plaint after its return, pray that a date may be fixed for appearance of the party in the said Court and request that notice of the date fixed be given to the plaintiff as well as to the defendant. The Court can thereafter fix a date for appearance and the new Court need not summon the defendant again if such notice had been given. In Joginder Tuli case (supra), the Court directed that the evidence already recorded be taken into consideration whereas in Modern Construction case (supra) a different view was taken.

Courts Overburdened, Not In Larger Interest To Start Proceedings De Novo

The bench further opined that, unless a party can prove that it has been actually prejudiced by some proceedings before the Court not having jurisdiction, it would not be in the larger interest to start the proceedings de novo.

The Courts in India are burdened with a lot of litigation. We see no justifiable reason why the proceedings which may have taken place in a Court even if it has no jurisdiction, cannot be transferred to the new Court having jurisdiction. Unless a party can prove that it has been actually prejudiced by some proceedings before the Court not having jurisdiction, it would not be in the larger interest to start the proceedings de novo. We may refer to certain provisions of the CPC in this regard. Section 21 of the CPC provides that no objection as to the territorial or pecuniary jurisdiction shall be allowed to be raised in an 10 appellate or revisional court unless such objection was taken in the Court of first instance or at the earliest possible opportunity and, in any event, before the framing of issues. The further requirement is that there should be consequent failure of justice. It has repeatedly been held that the objections with regard to the pecuniary or territorial jurisdiction are technical objections and unless raised at the earliest possible opportunity, cannot be entertained in appeal or revision for the first time.

Why should the clock be turned back ?

While referring the matter to larger bench, the court further observed:

When the Court orders a return of the plaint, we prima facie feel that the Court exercising its inherent jurisdiction should return the plaint, which is the property of the plaintiff, to the plaintiff but should also transfer the other material on record to the Court to which the plaintiff applies for transfer in terms of Order VII Rule 10A. This would avoid duplicity of proceedings, evidence and contradictions in pleadings and evidence, if two sets of pleadings and evidence are allowed in the same set of proceedings. In the case in hand, the case was fixed for rebuttal evidence, if any, and arguments. Pleadings and evidence are over. Why should the clock be turned back by 6 years, which it took to reach this stage?

Click here to Read/Download Judgment