“SANDEEP THAPAR v.

SME TECHNOLOGIES PRIVATE LIMITED

(2014) 2 SCC 302”

A Project submitted in the complete fulfilment of the course THE CODE

OF CIVIL PROCEDURE AND LAW OF LIMITATION ACT, 5th
SEMESTER during the Academic Year 2020-2021

SUBMITTED BY:

SANDEEP SINGH BHANDARI

Roll No. – 1968

B.A. LL.B. (Hons.)

SUBMITTED TO:

PROF. DR. MEETA MOHINI

FACULTY OF THE CODE OF CIVIL PROCEDURE AND LAW OF LIMITATION

ACT

ACADEMIC SESSION- 2018-2023

CHANAKYA NATIONAL LAW UNIVERSITY, NAYAYA NAGAR, MEETHAPUR,

PATNA-800001
 DECLARATION BY THE CANDIDATE

I hereby declare that the work reported in the B.A.LL.B (Hons.) Project Report Entitled
“SANDEEP THAPAR v. SME TECHNOLGIES PRIVATE LIMITED (2014) 2 SCC
302” submitted at Chanakya National Law University, Patna is an authentic record of my
work carried out under the supervision of Prof. DR. MEETA MOHINI. I have not submitted
this work elsewhere for any other degree or diploma. I am fully responsible for the contents
of my Project Report.

(Signature of the Candidate)

SANDEEP SINGH BHANDARI

Chanakya National Law University, Patna

2
 ACKNOWLEDGEMENT

Firstly, I would like to thank my faculty of THE CODE OF CIVIL PROCEDURE AND
LAW OF LIMITATION ACT, DR. MEETA MOHINI for providing me an opportunity to
make my project on such an interesting topic which is also a contemporary issue as for now.

Secondly, I would like to thank all my colleagues and friends for helping me out in arranging
of the accumulated collected study material.

Lastly, special thanks to my parents for guiding me in giving the final touch to this project
and helping me out throughout this project.

CONTENT

3
S
INTRODUCTION......................................................................................................................5

PROVISIONS APPLIED IN THE CASE..................................................................................7

ANALYSIS OF THE JUDGMENT.........................................................................................11

CONCLUSION AND SUGGESTIONS..................................................................................14

BIBLIOGRAPHY....................................................................................................................15

STATUES.............................................................................................................................15

BOOKS.................................................................................................................................15

WEBSITES...........................................................................................................................15

4
 INTRODUCTION
The case of Sandeep Thapar v. SME Technologies Private Limited1 deals with the provisions
of Code of Civil Procedure, 1908. The sections which it covers is Section 35 & 35-B and it
also cover Order VIII Rule 1 and Order I Rule 10. The court relied on the earlier judgment in
the case Kailash v. Nanhku (2005) 4 SCC 480. The appellant moved to the H’onble Supreme
Court after the division bench of the High Court at Delhi disallowed the appellant to file a
written statement after the expiry period of 30 days + 60 days which is permissible under the
provisions of CPC. The appellant wanted one Mr Sharad Maheshwari to be impleaded as
plaintiff under Order I Rule 10. The aforesaid Mr Sharad Maheshwari is the Managing
Director of the plaintiff company who is privy to the entire cause of action of the suit filed for
recovery of Rs 39.90 lakhs based on alleged oral agreement. The applications filed by the
appellant were dismissed by the learned Single Judge of the High Court on 3rd August, 2010.
The aforesaid order was challenged before the Division Bench. The Division Bench after
hearing the counsel for the parties has observed that the learned single judge has correctly
held that it is not necessary to implead Mr. Sharad Maheshwari as the plaintiff as the
company being a legal entity is entitled to file a suit in its own name through an authorized
representative. It is also observed that it is for the plaintiff to prove its case during the trial.
Therefore, non impleadment of Mr. Sharad Maheshwari will have consequences only for the
plaintiff and not for the appellant. The plea of the appellant that since Mr. Sharad
Maheshwari had not filed his affidavit, despite the entire suit being based on an oral
agreement alleged to have been entered into between the appellant and Mr. Maheshwari, in
case the appellant was to file his written statement that would disclose his defence, has been
rejected by the Division Bench.
The application of the appellant for seeking extension in time for filing the written statement
has been rejected with the observation that that Order VIII Rule 1 CPC is mandatory and the
Court cannot permit filing of a written statement beyond the 30 days from the date of service
of summons. At best, the Court has power to permit a period of further 60 days from the date
of service of summons upon the defendant to file the written statement. But this has to be
done for reasons to be recorded in writing. Since the appellant herein has filed the application
beyond the period of 30 days + 60 days, it was not permissible for the Court to allow the
appellant to file the written statement.

1
AIR (2014) 2 SCC 302.

5
The Court was satisfied that in the circumstances of this case, the High Court ought to have
permitted the appellant to file written statement, beyond the period prescribed in Order VIII
rule 1, given the facts and circumstances of this case.
AIMS AND OBJECTIVES:
1. To know about the provision which is incorporated in the case of Sandeep Thapar v.
SME Technologies Private Limited (2014) 2 SCC 302.
2. To know about the facts and judgement of the above case.
3. To know about the cost which the party has to pay under Sec 35 & 35-B.
4. To know about the exception which can be availed in extraordinary situations under
Order VIII Rule 1.

HYPOTHESIS:

1. The submission of written statements under Rule VIII Order 1 can be extended.
2. The extension of time granted under the said provision is availed during normal
transactions and without any cost.

RESEARCH METHODOLOGY:
3. The method of this research work is Doctrinal in nature.

SOURCES:

4. Primary Sources: Observations, Questionnaire, Government documents, Internet

communications on email, blogs, newsgroup.
5. Secondary Sources: Reference books, Commentaries and treatises, Works of
interpretation, Textbooks, Abstracts.

LIMITATIONS OF STUDY: The researcher will confine the research to the city of Patna,
Bihar. Due to the constraints, the researcher will include library work.

6.
7. SCOPE: To understand the jurisdictional issue regarding the law of the sea.

6
 PROVISIONS APPLIED IN THE CASE
According to Black’s Law Dictionary “costs is a pecuniary allowance made to the successful
party for his expenses in prosecuting or defending a suit or a distinct proceeding with a suit” 2.
Cost are an allowance to the party for expenses incurring in prosecuting or defending a suit,
an incident to the judgment. In England the term is also used to designate the charges which
an attorney or solicitor is entitled to make and recover from his client, as his remuneration for
professional services, such a legal advice, attendances, drafting, conducting legal proceedings
etc.
Section 35 of the Code of Civil Procedure 3 contains the provision as to costs. The cost of an
incident to all suits are in the discretion of the Court and the court shall have full power to
determine by order out of what property and what extent such costs are to be paid. All
necessary direction for these purposes will be given by the court. Where the Court directs the
costs are not to follow the events the court shall give it in writing.
Section 35-A: Section 35-A deals with compensatory costs in respect of false and vexatious
claims and defence. If in any suit or proceedings, any party objects to the claim or defence on
the ground that the claim or defence on any part of it , as against the objector , is false or
vexatious and if thereafter as against the objector, such claim or defence is disallowed,
abandoned or withdrawn in whole or in part , the Court if it thinks fit may , after recording its
reasons for so holding make an order for payment to the objector by the party by whom such
claim or defence was put forward , of costs by way of compensation. No court can make any
such order for payment of an amount exceeding three thousand rupees or exceeding the limits
of the pecuniary jurisdiction, whichever amount is less. The amount of any compensation
awarded under this section in respect of false claim or defence has to be taken into account in
any subsequent suit for damages or compensation of such claim or defence.
Section 35-B: Section 35-B was amended in the Code of Civil Procedure by amendment act
of 1976. It provides for costs for causing delay. Where separate defenses have been raised by
the defendant or group of defendants payment of such costs shall be a condition precedent to
the further prosecution of the defense by such defendants as have been ordered by Court to
pay such costs.4
The cost ordered to be paid under sub-section (1) shall not, if paid, be included in the costs
awarded in the decree passed in the suit, but if such costs are not paid, a separate order shall

2
Apperson v. Insurance Company 38 N.J. Law.
3
Section 6., Code of Civil Procedure, 1908.
4
C.K. Thakkar., Code of Civil Procedure., pp- 645-47.

7
be drawn up indicating the amount of such costs and the names and addresses of the persons
by whom such costs are payable and the order so drawn up shall be executable against such
persons.
Principals:
The primary rules in respect of award of general cost are as under:
a) Costs are at the discretion of the court.The said discretion must be exercised on sound legal
principles and not by caprice, chance or humour. No hard and fast rules can be laid down and
the discretion must be exercised considering the facts and circumstances of each case.
b) Normally, costs to follow the event and the successful party are entitled to costs unless
there are good grounds for depriving him of that right.5To put it differently the loser pays
costs to the winner. However it does not always depend on who wins and losses in the end.
Even a successful party may be deprived of costs if he is guilty of misconduct or there are
other reasons to do so.6Sub-section (2) of section 35 expressly provides that when the court
orders that cost should not follow the event, it must record reasons for doing
so.Miscellaneous costs: Order 20-A:
Order 20-A makes specific provisions with regard to the power of the court to award costs in
respect of certain expenses incurred in giving notices, typing charges, inspecting of records,
obtaining copies and producing witnesses.
Section 35-B7 is added by the Amendment Act of 1976. It is inserted to put a check upon the
delaying tactics of litigating parties. It empowers the court to impose compensatory costs on
parties who are responsible for causing delay at any stage of the litigation. Such costs would
be irrespective of the ultimate outcome of the litigation. 8 The payment of cost has been a
condition precedent for further prosecution of the suit, if the party concerned is a plaintiff and
the defence , if he is a defendant.9

The provisions of this Section are mandatory in nature and therefore the court should not
allow prosecution of suit or defence, in the event of partly failing to pay costs as directed by
the court. If a party is unable to pay costs due to circumstances beyond his control, such as
strike of advocates or staff , declaration of the last day for payment of costs as holiday, etc.
the court can extend the time.

5
Jugraj Singh v. Jaswant Singh (1970) 2 SCC 386.
6
Col. A.S. Iyer v. V. Balasubramanyam. (1980) 1 SCC 634.
7
Sec 35-B., Code of Civil Procedure, 1908.
8
Statement of objects and reason.
9
Hakmi v. Pitamber AIR 1978 P&H 145.

8
Very recently in Ashok Kumar v. Ram Kumar , the Supreme Court observed that the present
system of levying meagre costs in civil matters is wholly unsatisfactory and does not act as a
deterrent to luxury litigation . More realistic approach relating to costs is the need of the hour.

By Code of Civil Procedure (Amendment) Act, 1999 (46 of 1999) the text of Order VIII,
Rule 1 was sought to be substituted in a manner that the power of court to extend the time for
filing the written statement was so circumscribed as would not permit the time being
extended beyond 30 days from the date of service of summons on the defendant. As is well-
known, there was stiff resistance from the members of the Bar against enforcing such and
similar other provisions sought to be introduced by way of amendment and hence
the Amendment Act could not be promptly notified for enforcement. The text of the
provision in the present form has been introduced by Code of Civil Procedure (Amendment)
Act, 2002 (22 of 2002) with effect from 1.7.2002. The purpose of such like amendments is
stated in the Statement of Objects and Reasons as "to reduce delay in the disposal of civil
cases".10

The text of Order VIII, Rule 1, as it stands now, reads as under: -

"1. Written statement.__ The defendant shall, within thirty days from the date of service of
summons on him, present a written statement of his defence:

Provided that where the defendant fails to file the written statement within the said period of
thirty days, he shall be allowed to file the same on such other day, as may be specified by the
Court, for reasons to be recorded in writing, but which shall not be later than ninety days
from the date of service of summons.11"

Three things are clear. Firstly, a careful reading of the language in which Order VIII, Rule 1
has been drafted, shows that it casts an obligation on the defendant to file the written
statement within 30 days from the date of service of summons on him and within the
extended time falling within 90 days. The provision does not deal with the power of the court
and also does not specifically take away the power of the court to take the written statement

10
Ibid.
11
T. Arvindanam v. T.N. Satyapal.

9
on record though filed beyond the time as provided for. Secondly, the nature of the provision
contained in Order VIII, Rule 1 is procedural. It is not a part of the substantive law. Thirdly,
the object behind substituting Order VIII, Rule 1 in the present shape is to curb the mischief
of unscrupulous defendants adopting dilatory tactics, delaying the disposal of cases much to
the chagrin of the plaintiffs and petitioners approaching the court for quick relief and also to
the serious inconvenience of the court faced with frequent prayers for adjournments. The
object is to expedite the hearing and not to scuttle the same. The process of justice may be
speeded up and hurried but the fairness which is a basic element of justice cannot be
permitted to be buried.12 In Mumbai International Airport (P) Ltd. v. Regency Convention
Centre and Hotels (P) Ltd. (supra), this Court considered the scope of Order 1 Rule 10(2)
CPC and observed:

The general rule in regard to impleadment of parties is that the Plaintiff in a suit, being
dominus litis, may choose the persons against whom he wishes to litigate and cannot be
compelled to sue a person against whom he does not seek any relief. Consequently, a person
who is not a party has no right to be impleaded against the wishes of the plaintiff. But this
general rule is subject to the provisions of Order 1 Rule 10(2) of the CPC (‘the Code’, for
short), which provides for impleadment of proper or necessary parties. The said sub-rule is
extracted below: Court may strike out or add parties. ‘The court may at any stage of the
proceedings, either upon or without the application of either party, and on such terms as may
appear to the court to be just, order that the name of any party improperly joined, whether as
plaintiff or defendant, be struck out, and that the name of any person who ought to have been
joined, whether as plaintiff or defendant, or whose presence before the court may be
necessary in order to enable the court effectually and completely to adjudicate upon and settle
all the questions involved in the suit, be added. The said provision makes it clear that a court
may, at any stage of the proceedings (including suits for specific performance), either upon or
even without any application, and on such terms as may appear to it to be just, direct that any
of the following persons may be added as a party: (a) any person who ought to have been
joined as plaintiff or defendant, but not added; or (b) any person whose presence before the
court may be necessary in order to enable the court to effectively and completely adjudicate
upon and settle the questions involved in the suit. In short, the court is given the discretion to
add as a party, any person who is found to be a necessary party or proper party.

12
Gundry v. Sainsbuy (1910) 1 KB 645.

10
11
 ANALYSIS OF THE JUDGMENT
The appeal was filed impugning the judgment 13 and order dated 12th November, 2010 in
FAO(OS) NO.607 of 2010, whereby the Division Bench of the Delhi High Court dismissed
the appeal filed by the appellant in I.A. NO.13902 of 2008 filed under Order VIII rule 1
praying for extension of time for filing written statement by the defendant i.e. the appellant
herein till I.A. No. 11803 of 2008 filed under Order I rule 10 to implead Mr. Sharad
Maheshwari as plaintiff. The aforesaid Mr. Sharad Maheshwari is the Managing Director of
the plaintiff Company who is privy to the entire cause of action of the suit filed for recovery
of Rs.39.90 lakhs based on alleged oral agreement/understanding. The applications filed by
the appellant were dismissed by the learned Single Judge of the High Court on 3rd August,
2010.

The aforesaid order was challenged before the Division Bench. The Division Bench after
hearing the counsel for the parties has observed that the learned single judge has correctly
held that it is not necessary to implead Mr. Sharad Maheshwari as the plaintiff as the
company being a legal entity is entitled to file a suit in its own name through an authorized
representative. It is also observed that it is for the plaintiff to prove its case during the trial.
Therefore, non impleadment of Mr. Sharad Maheshwari will have consequences only for the
plaintiff and not for the appellant. The plea of the appellant that since Mr. Sharad
Maheshwari had not filed his affidavit, despite the entire suit being based on an oral
agreement alleged to have been entered into between the appellant and Mr. Maheshwari, in
case the appellant was to file his written statement that would disclose his defence, has been
rejected by the Division Bench.

The High Court was of the opinion that even if Mr. Sharad Maheshwari is impleaded and had
filed an affidavit, the averments in the plaint could not have been changed. In other words,
the character of the plaint, the pleadings contained therein and the relief claimed would
remain the same.

The application of the appellant for seeking extension in time for filing the written statement
has been rejected with the observation that that Order VIII Rule 1 CPC 14 is mandatory and the

13
https://indiankanoon.org/doc/177363969/.
14
R. 1 O. 7., Code of Civil Procedure, 1908.

12
Court cannot permit filing of a written statement beyond the 30 days from the date of service
of summons. At best, the Court has power to permit a period of further 60 days from the date
of service of summons upon the defendant to file the written statement. But this has to be
done for reasons to be recorded in writing. Since the appellant herein has filed the application
beyond the period of 30 days + 60 days, it was not permissible for the Court to allow the
appellant to file the written statement.

Learned counsel for the appellant has submitted that undoubtedly the limit under Order VIII
rule 115 has to be observed, but in exceptional circumstances in order to ensure that the
injustice is not done, the Court will have the power to permit the defendant to file the written
statement.

We have considered the submission made by the learned counsel. In our opinion, the
submission made by the learned counsel is well founded in view of the observations made by
this Court in Kailash versus Nanhku and others. 16 The purpose of providing the time
schedule for

filing the written statement under Order VIII, Rule 1 of CPC is to expedite and not to scuttle
the hearing. The provision spells out a disability on the defendant. It does not impose an
embargo on the power of the Court to extend the time. Though, the language of the proviso to
Rule 1 of Order VIII of the CPC is couched in negative form, it does not specify any penal
consequences flowing from the non-compliance. The provision being in the domain of the
Procedural Law, it has to be held directory and not mandatory. The power of the Court to
extend time for filing the written statement beyond the time schedule provided by Order VIII,
Rule 1 of the CPC is not completely taken away.

Though Order VIII, Rule 1 of the CPC is a part of Procedural Law and hence directory,
keeping in view the need for expeditious trial of civil causes which persuaded the Parliament
to enact the provision in its present form, it is held that ordinarily the ...5/-

time schedule contained in the provision is to be followed as a rule and departure therefrom
would be by way of exception. A prayer for extension of time made by the defendant shall
not be granted just as a matter of routine and merely for asking, more so when the period of
90 days has expired. Extension of time may be allowed by way of an exception, for reasons

15
Ibid.
16
(2005) 4 SCC 480.

13
to be assigned by the defendant and also be placed on record in writing, howsoever briefly,
by the Court on its being satisfied. Extension of time may be allowed if it was needed to be
given for the circumstances which are exceptional, occasioned by reasons beyond the control
of the defendant and grave injustice would be occasioned if the time was not extended. Costs
may be imposed and affidavit or documents in support of the grounds pleaded by the
defendant for extension of time may be demanded, depending on the facts and circumstances
of a given case.”

We are satisfied that in the circumstances of this case, the High Court ought to have
permitted the appellant to file written statement, beyond the period prescribed in Order VIII
rule 1, given the facts and circumstances of this case.

In view of the above, the appeal is allowed. The appellant is permitted to file the written
statement within a period of two weeks from today on payment of Rs.50,000/- (Rupees fifty
thousand) as cost.17

17
Supra note 1.

14
CONCLUSION AND SUGGESTIONS

15
 BIBLIOGRAPHY
The researcher has consulted following sources to complete the rough proposal:

STATUES

• The Code of Civil Procedure, 1908.

• The Limitation Act, 1963.

BOOKS
• C.K. Takwani, Civil Procedure with Limitation Act, 1963, (8th ed. LexisNexis, 2019).

WEBSITES

• SCC ONLINE, (Oct. 05, 2020, 09:05 PM) https://www.scconline.com/.

• AAPTAXLAW, Order XLI appeals from original degrees - rule 1, 2, 3, 4 of code of civil
procedure 1908, (Oct. 05, 2020, 09:05 PM), https://www.aaptaxlaw.com/code-of-civil-
procedure/order-xli-code-of-civil-procedure-rule-1-2-3-4-appeals-from-original-degrees-
order-41-of-cpc-1908-code-of-civil-procedure.html.

16