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Supreme Court CPC Digest : Important Civil

Law Judgments Of 2021
LIVELAW NEWS NETWORK 31 Dec 2021 7:58 PM

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1/12/22, 5:24 PM Supreme Court CPC Digest : Important Civil Law Judgments Of 2021

The Code of Civil Procedure, 1908 [CPC] is an important law as far Civil law

practitioners are concerned. Various High Courts have interpreted many provisions of

the Code differently. The following are some of the important judgments delivered by

the Supreme Court which deals with CPC.

Appellate Court's Jurisdiction Under Section 96 CPC Involves Rehearing On

Questions Of Law As Well As Fact: Supreme Court

Also Read - All Supreme Court 2021 Digests & Round-Up Reports In One Place

[Case: Manjula v. Shyamsundar; Citation: LL 2021 SC 52]

A bench comprising Justices S. Abdul Nazeer and Surya Kant observed that an

appellate court's jurisdiction under Section 96 of CPC involves a rehearing of appeal

on questions of law as well as fact. It noted that the provision provides for filing of an

appeal from the decree passed by a court of original jurisdiction and Order 41 Rule 31

of CPC provides the guidelines to the appellate court for deciding the appeal. The

bench said that the judgment of the appellate court shall state (a) points for

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determination; (b) the decision thereon; (c) the reasons for the decision; and (d) where

the decree appealed from is reversed or varied, the relief to which the appellant is

entitled.

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One-Sided Enquiries': Supreme Court On PM Security Lapse

Appellate Court Cannot Permit Production Of Additional Evidence Unless & Until

Procedure Under Order XLI Rules 27-29 CPC Is Followed: Supreme Court

[Case: HS Goutham v. Rama Murthy; Citation: LL 2021 SC 84]

A bench comprising Justices Ashok Bhushan, R. Subhash Reddy and MR Shah

observed that unless and until the procedure under Order XLI Rules 27, 28 and 29 are

followed, the parties to the appeal cannot be permitted to lead additional evidence

and/or the appellate court is not justified to direct the court from whose decree the

appeal is preferred or any other subordinate court, to take such evidence and to send

it when taken to the Appellate Court.

Also Read - Sub-Lessee Can't Acquire Status Of Tenure Holder Under UP Land

Ceiling Act If Sub-Lease Was Contrary To Conditions: Supreme Court

Timeline For Pronouncement Of Judgment Prescribed In Order XX CPC Does Not

Apply To High Courts: Supreme Court

[Case: SJVNL v. M/s CCC HIM JV & Anr.; Citation: LL 2021 SC 87]

A Bench comprising of Justices RF Nariman and BR Gavai observed that timeline for

pronouncement of judgment prescribed in Order XX of CPC does not apply to the High

Court.

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"It is true, that for the High Courts, no period for pronouncement of judgment is

contemplated either under the Code of Civil Procedure or the Criminal Procedure

Code, but as the pronouncement of the judgment is a part of justice dispensation

system, it has to be without delay," the bench held.

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Warns Supertech Directors

Parties Who Privately Agree To Settle Disputes Without Court Intervention U/s 89

CPC Also Entitled To Refund Of Court Fee: Supreme Court

[Case: High Court of Judicature at Madras v. MC Subramaniam; Citation: LL 2021 SC

97]

A bench comprising Justices Mohan M. Shantanagoudar and Vineet Saran held that

the parties who privately agree to settle their dispute outside the modes contemplated

under Section 89 of CPC are also entitled to refund of Court fees. "The narrow

interpretation of Section 89 of CPC and Section 69­A of the 1955 Act sought to be

imposed by the Petitioner would lead to an outcome wherein parties who are referred

to a Mediation Centre or other centres by the Court will be entitled to a full refund of

their court fee; whilst parties who similarly save the Court's time and resources by

privately settling their dispute themselves will be deprived of the same benefit, simply
because they did not require the Court's interference to seek a settlement," the Court

observed.

Order VII Rue 11 CPC: Court Has Inherent Power To See That Frivolous Or Vexatious

Litigations Are Not Allowed To Consume Its Time: Supreme Court

[Case: K. Akbar Ali v. K. Umar Khan; Citation: LL 2021 SC 114]

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A Division Bench of Justices Indira Banerjee and Hemant Gupta observed that the

provisions of Order VII Rue 11 [Rejection of Plaint] are not exhaustive and the Court

has the inherent power to see that frivolous or vexatious litigations are not allowed to

consume the time of the Court.

The bench observed that while considering an application under Order VII Rule 11 of

the CPC, the question before the Court is whether the plaint discloses any cause of

action or whether the suit is barred by any law, on the face of the averments contained

in the plaint itself. While considering an application under Order VII Rule 11 of the CPC

the Court is not to look into the strength or weakness of the case of the plaintiff or the

defence raised by the defendant, it added.

Application Under Order IX Rule 13 CPC Can Be Allowed Only When Sufficient Cause

Is Made Out To Set Aside Ex­Parte Decree: Supreme Court

[Case: Subodh Kumar v. Shamim Ahmed; Citation: LL 2021 SC 134]

A bench comprising Justices Ashok Bhushan and R. Subhash Reddy observed that an

application under Order 9 Rule 13 of the Code of Civil Procedure cannot be

automatically granted and can be allowed only when sufficient cause is made out to

set aside the ex­parte decree.

Second Appeal: Judgment Should Not Be Interfered With By High Court Unless There

Is A Substantial Question Of Law, Reiterates Supreme Court

[Case: Mallanaguoda v. Ninganagouda; Citation: LL 2021 SC 188]

A bench comprising Justices L. Nageswara Rao and S. Ravindra Bhat reiterated that,

the judgment of the First Appellate Court should not be interfered with by the High

Court in exercise of its jurisdiction under Section 100 of the Code of Civil Procedure,

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unless there is a substantial question of law. The First Appellate Court is the final

Court on facts

Functional Convenience Of A Party In Commercial Litigations Cannot Be A Ground To

Transfer Case U/s 25 CPC: Supreme Court

[Case: Fumo Chem Pvt. Ltd. v. Raj Process Equipments And Systems Pvt. Ltd.;

Citation: LL 2021 SC 216]

The Bench of Justice Aniruddha Bose observed that functional convenience of one of

the parties in commercial litigations cannot be a ground to transfer under Section 25

of CPC.

"A petitioner seeking transfer of a case involving business-related disputes from one

jurisdiction to another will have to establish some grave difficulty or prejudice in

prosecuting or defending the case in a forum otherwise having power to adjudicate

the cause," it observed.

In this case, the petitioner company sought transfer of a subsequent suit instituted by

the respondents against them in Pune to Ahmedabad. The court noted that the

petitioners' case is largely founded on the claim of having approached a judicial forum

before the respondents did and both the suits emanate from the same set of facts

with the same set of parties.

Supreme Court Directs High Courts To Reconsider And Update Rules Relating To

Execution Of Decrees

[Case: Rahul S Shah v. Jinendra Kumar Gandhi; Citation: LL 2021 SC 232]

A bench comprising former CJI SA Bobde, Justices L. Nageswara Rao and S. Ravindra

Bhat directed the High Courts to reconsider and update all the Rules relating to

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Execution of Decrees, made under exercise of its powers under Article 227 of the

Constitution of India and Section 122 of CPC, within one year.

The Court observed that in suits relating to delivery of possession, the court must

examine the parties to the suit under Order X in relation to third party interest and

further exercise the power under Order XI Rule 14 asking parties to disclose and

produce documents, upon oath, which are in possession of the parties including

declaration pertaining to third party interest in such properties.

Court Cannot Grant Liberty To Amend Plaint While Rejecting It Under Order VII Rule

11(d) CPC

[Case: Sayyed Ayaz Ali v. Prakash G Goyal; Citation: LL 2021 SC 314]

The Supreme Court held that while rejecting a plaint under Order 7 Rule 11(d) of Code

of Civil Procedure, the Court cannot grant liberty to the plaintiff to amend the plaint.

The proviso to Rule 11 covers the cases falling within the ambit of clauses (b) and (c)

and has no application to a rejection of a plaint under Order 7 Rule 11(d), the Bench

comprising Justices DY Chandrachud and MR Shah observed.

Second Appeal, After Its Admission With Formulation Of Substantial Question Of

Law, Cannot Be Disposed Of Summarily

[Case: Ramdas Waydhan Gadlinge (Since Deceased) v. Gyanchand Nanuram Kriplani

(Dead); Citation: LL 2021 SC 340]

A second appeal, after its admission with formulation of substantial question of law,

cannot be disposed of summarily, the Supreme Court has observed. The bench of

Justices Vineet Saran and Dinesh Maheshwari observed that once a second appeal is

admitted, on the High Court being satisfied that a substantial question of law is

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involved in the case and with formulation of that question, the appeal is required to be

heard in terms of Order XLII of Code of Civil Procedure.

Order XLI Rule 22 CPC- Cross Objection Not Necessary To Challenge Adverse

Findings

[Case: Saurav Jain v. A. B. P. Design; Citation: LL 2021 SC 354]

The Supreme Court has observed that a party in whose favour a court has decreed the

suit can challenge an adverse finding before the appellate court without a cross

objection. "It is not necessary that a challenge to the adverse findings of the lower

court needs to be made in the form of a memorandum of cross-objection", the bench

comprising Justices DY Chandrachud and MR Shah observed. The Court also

observed that it can entertain new grounds raised for the first time in an appeal under

Article 136 of the Constitution if it involves a question of law which does not require

adducing additional evidence.

Not Much Scope For Considering 'Territorial Jurisdiction' Issue In A Transfer Petition

U/s 25 CPC

[Case: Naivedya Associates v. Kriti Nutrients Ltd; Citation: LL 2021 SC 356]

The Supreme Court has observed that there is not much scope of going into the

question of 'territorial jurisdiction' of a court in a Transfer Petition under Section 25 of

the Code of Civil Procedure. This point is required to be urged before the Court in

which the suit is pending, Justice Aniruddha Bose observed while dismissing a

transfer petition. In this case, the petitioner is a defendant in a suit instituted in the

Court of District Judge, Shahdara, Karkardooma Court, New Delhi alleging

infringement of trade mark and copyright.

Res Judicata Is Not A Ground To Reject A Plaint Under Order VII Rule 11(d) CPC

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[Case: Srihari Hanumandas Totala v. Hemant Vithal Kamat; Citation: LL 2021 SC 364]

The Supreme Court has observed that the Res Judicata cannot be a ground for

rejection of the plaint under Order VII Rule 11(d) of the Code of Civil Procedure. "Since

an adjudication of the plea of res judicata requires consideration of the pleadings,

issues and decision in the 'previous suit', such a plea will be beyond the scope of

Order 7 Rule 11 (d), where only the statements in the plaint will have to be perused.",

the bench comprising Justices DY Chandrachud and MR Shah observed.

Second Appeal- High Courts Can Exercise Limited Factual Review Under Section 103

CPC

[Case: K.N. Nagarajappa v. H. Narasimha Reddy; Citation: LL 2021 SC 433]

The Supreme Court has observed that High Courts are empowered to exercise limited

factual review under Section 103 of the Code of Civil Procedure. The bench of

Justices L. Nageswara Rao and S. Ravindra Bhat observed that the rule that sans a

substantial question of law, the High Courts cannot interfere with findings of the lower

Court or concurrent findings of fact, is subject to the following two important caveats:

First, if the findings of fact are palpably perverse or outrage the conscience of the

court; in other words, it flies on the face of logic that given the facts on the record,

interference would be justified. Second, where the findings of fact may call for

examination and be upset, in the limited circumstances spelt out in Section 103 CPC.

Commercial Suits & Requirement Of Establishing Reasonable Cause For Non

Disclosure Of Documents Under Order XI Rule 1 (4) CPC

[Case: Sudhir Kumar @ S. Baliyan v. Vinay Kumar G.B; Citation: LL 2021 SC 458]

The Supreme Court has observed that the requirement under Order XI Rule 1(4) of

Code of Civil Procedure (as applicable to commercial suits) of establishing the

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reasonable cause for non disclosure of the documents along with the plaint under

shall not be applicable if it is averred and it is the case of the plaintiff that those

documents have been found subsequently and in fact were not in the plaintiff's power,

possession, control or custody at the time when the plaint was filed.

The Apex Court bench of Justices MR Shah and Aniruddha Bose observed, "However,

at the same time, the requirement of establishing the reasonable cause for non

disclosure of the documents along with the plaint shall not be applicable if it is

averred and it is the case of the plaintiff that those documents have been found
subsequently and in fact were not in the plaintiff's power, possession, control or

custody at the time when the plaint was filed."

Order VII Rule 11 CPC - Plaint Can't Be Rejected If Limitation Is A Mixed Question Of

Law & Fact

[Case: Salim D.Agboatwala and others v.Shamalji Oddavji Thakkar and others;

Citation: LL 2021 SC 476]

The Supreme Court has held that a plaint cannot be rejected under Order VII Rule

11(d) of the Code of Civil Procedure if the issue of limitation is a mixed question of

law and fact. A bench comprising Justices Hemant Gupta and V Ramasubramaniam

observed so while reversing a Bombay High Court's judgment which had upheld a civil

court's order to reject a plaint. The suit in question was filed essentially to set aside an

order passed by the Agricultural Land Tribunal to issue sale certificate in respect of a

tenancy under the Maharashtra Tenancy and Agricultural Lands Act, 1948.

Order VII Rule 11 CPC: Plaint Has To Be Rejected If Reliefs Claimed In It Cannot Be

Granted Under Law

[Case: Rajendra Bajoria v. Hemant Kumar Jalan; Citation: LL 2021 SC 483]

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The Supreme Court observed that a court has to reject a plaint if it finds that none of

the reliefs sought in it can be granted to the plaintiff under the law. In such a case, it

will be necessary to put an end to the sham litigation so that further judicial time is

not wasted, the bench of Justices L. Nageswara Rao and BR Gavai observed. The

court added that underlying object of Order VII Rule 11 of CPC is that when a plaint

does not disclose a cause of action, the court would not permit the plaintiff to

unnecessarily protract the proceedings.

Section 92 CPC- Judgment In Representative Suit Binds All Parties Interested In The

Trust

[Case: Jamia Masjid v. K V Rudrappa; Citation: LL 2021 SC 491]

The Supreme Court observed that a suit under section 92 CPC is of a representative

character and all persons interested in the Trust would be bound by the judgment in

the suit. Such persons interested would be barred by the principle of res judicata from

instituting a subsequent suit on the same or substantially the same issue, the bench

of Justices DY Chandrachud, Vikram Nath and Hima Kohli observed. The court added

that while deciding on a scheme for administration in a representative suit filed under

Section 92 of the CPC the court may, if the title is contested, have to decide if the

property in respect of which the scheme for administration and management is

sought belongs to the Trust.

Order IX Rule 13 CPC : Supreme Court Holds Defendant Who Refused Summons Not

Entitled To Seek Setting Aside Of Ex-Parte Decree

[Case: Vishwabandhu v. Sri Krishna and another; Citation: LL 2021 SC 517]

The Supreme Court set aside a judgment of the High Court, which had allowed the

setting aside of an ex-parte decree under Order IX Rule 13 of the Code of Civil

Procedure. The bench comprising Justices Uday Umesh Lalit and S Ravindra Bhat

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noted that Sub-Rule (5) of Order V Rule 9 of the Code states inter alia that if the

defendant or his agent had refused to take delivery of the postal article containing the

summons, the court issuing the summons shall declare that the summons had been

duly served on the defendant.

First Appellate Court Should Deal With All Issues And Evidence And Follow

Procedure Under CPC

[Case: K. Karuppuraj v. M. Ganesan; Citation: LL 2021 SC 534]

The Supreme Court observed that it is the duty of the First Appellate Court to deal with

all the issues and the evidence led by the parties before recording its findings. First

appeals are to be decided after following the procedure to be followed under the Code

of Civil Procedure, the bench of Justices MR Shah and AS Bopanna observed.

Order VIII Rule 1 CPC - Period For Filing Of Written Statement Is Directory In Civil

Suits; But Mandatory In Commercial Suits

[Case: Shoraj Singh v. Charan Singh; Citation: LL 2021 SC 573]

The Supreme Court observed that the period of 90 days for filing of written statement

under Order VIII Rule 1 of Code of Civil Procedure in civil suits is directory. The bench

of Justices Hemant Gupta and V. Ramasubramanian held the provisions of Order VIII

Rule 1 CPC are mandatory in the Commercial Courts under the Commercial Courts

Act, 2015. "It may be stated herein that the provisions of Order 8 Rule of CPC are

mandatory in the Commercial Courts under the Commercial Courts Act, 2015", the

Supreme Court observed.

Order XXI Rule 16 CPC - Transferee Of Rights In Subject Matter Of Suit Can Apply For

Execution Without Separate Assignment Of Decree

[Case: Vaishno Devi Construction v. Union of India; Citation: LL 2021 SC 580]

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The Supreme Court observed that the Explanation to Order XXI Rule 16 of the Code of

Civil Procedure, removed the distinction between an assignment pre-the decree and

an assignment post the decree. Thus, the court observed that there is no bar under

Order XXI Rule 16 against assignee who acquired rights prior to decree from making

an application to execute the decree. The bench comprising Justices Sanjay Kishan

Kaul and BR Gavai observed that the objective of the said amendment is to avoid

multifarious proceedings to determine the issue of assignment and to determine the

issue of assignment in the execution proceedings itself. The bench was hearing an

appeal arising out of a claim based of an assignee of the decree holder in terms of

Order XXI Rule 16 CPC ( application for execution by transferee of decree). During the

pendency of the execution proceedings, the decree holder died. The appellants (now

before SC) filed application before the executing court under Section 47 read with

Order 22 Rules 1&2 of the CPC. This claim was based on the basis of an assignment

made by the deceased decree holder (prior to decree). This application was dismissed

by the Trial Court, and later by the High Court.

High Court Cannot Dismiss Second Appeal In Limine Without Assigning Reasons

[Case: Hasmat Ali v. Amina Bibi and others; Citation: LL 2021 SC 689]

Holding that a High Court cannot dismiss a second appeal filed under Section 100 of

the Code of Civil Procedure in limine without assigning reasons, the Supreme Court

remitted a matter back to the High Court for fresh consideration. A Bench comprising

Justices S. Abdul Nazeer and Krishna Murari observed that if the case does not

involve any substantial question of law, the High Court has no option but to dismiss

the appeal. However, in order to come to a conclusion that the appeal does not involve

any substantial of law, the High Court has to record the reasons.

CPC - Obstructor's Claims Over Decree Property Must Be Determined In Execution

Proceedings And Not In Separate Suit: Supreme Court

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[Case: Bangalore Development Authority v. N. Nanjappa and another; Citation: LL 2021

SC 712]

The Supreme Court held that claims raised by an obstructor including questions

relating to right, title or interest in the property in execution proceedings filed by the

decree holder against the judgment debtor, has to be adjudicated upon by the

Executing Court in the execution proceedings itself.

A Bench comprising Justice MR Shah and Justice BV Nagarathna held that in

accordance with Order XXI Rule 101 CPC, an application filed under Order XXI Rule 97

with respect to resistance or obstruction to possession of immovable property have to

be determined by the Court dealing with the application and for that a separate suit is

not required to be filed.

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