Legal Issues - Page 5 of 18 - Bindal Law Associates

Posted on 5th April 2022 by rajatbindal5gmailcom — Leave a comment

Déclaration suit to declare that cheaque was issued as security is invalid as against the concept of section 138 N I Act

SUPREME COURT OF INDIA

DIVISION BENCH

M/S FROST INTERNATIONAL LIMITED — Appellant

Vs.

M/S MILAN DEVELOPERS AND BUILDERS (P) LIMITED AND ANOTHER @ RESPONDENT

( Before : M.R. Shah and B.V. Nagarathna, JJ. )

Civil Appeal No. 1689 of 2022

Decided on : 01-04-2022

Civil Procedure Code, 1908 (CPC) – Order 7 Rule 11 – Negotiable Instruments Act, 1881 – Sections 118 (a) and 138 – Declaration – Security cheque – On a reading of the same, it is clear that there is a rebuttable presumption that every negotiable instrument including a cheque was made or drawn for a consideration and every such instrument when it has been accepted is for a consideration – Right of defendant to prosecute the plaintiff owing to the dishonour of the cheque issued by the plaintiff cannot be frustrated by seeking a declaration that the said cheque was handed over as a security – Such a declaration cannot be ex facie granted as it would be contrary to the provisions of the N.I. Act and particularly Section 118(a) thereof – Hence, the plaint is liable to be rejected in exercise of jurisdiction under Order VII Rule 11 CPC.

Counsel for Appearing Parties

Mrs. Rajdipa Behura, Advocate, Mr. A. Venayagam Balan, Advocate, Mr. Philomin Kani Advocate, Mr. Ashray Behura, Advocate, Ms. Neha Lingwal, Advocate, Ms. Hansika Sahu, Advocate, Mr. Swayamtosh Rath, Advocate, for the Appellant; Mr. Anirudh Sanganeria, Advocate, for the Respondent.

Cases Referred

Aristo Printers Pvt. Ltd. v. Purbanchal Trade Centre AIR 1992 Gau. 81
Atul Kumar Singh v. Jalveen Rosha AIR 2000 Del 38
Azhar Hussain vs. Rajiv Gandhi – [1986 Supp SCC 315]
Cotton Corporation of India Limited vs. United Industrial Bank Limited and Ors. -[(1983) 4 SCC 625]
Cotton Corporation of India Ltd. v. United Industrial Bank Ltd. AIR 1983 SC 1272
D. Ramachandran vs. R.V. Janakiraman – [(1999) 3 SCC 367]
Dahiben vs. Arvindbhai Kalyanji Bhanusali (Gajra) Dead through Legal Representatives and Others – [(2020) 7 SCC 366]
DLF Housing & Construction Co. (P) Ltd. v. Sarup Singh, (1969) 3 SCC 807 : (1970) 2 SCR 368
Gauri Shanker v. District Board AIR 1947 All. 81
Hardesh Ores (P.) Ltd. vs. Hede & Co. – [(2007) 5 SCC 614]
I.T.C Ltd. vs. Debts Recovery Appellate Tribunal and Ors. – [(1998) 2 SCC 70]
Liverpool & London S.P. & I Assn. Ltd. vs. M.V. Sea Success I & Anr. – [(2004) 9 SCC 512]
Madanuri Sri Rama Chandra Murthy vs. Syed Jalal -[(2017) 13 SCC 174]
N.P. Essappa Chettiar AIR 1942 Mad. 756
Pandurang Dhondi Chougule and Others vs. Maruti Hari Jadhav and Others – [AIR 1966 SC 153]
Rajendra Bajoria and Others vs. Hemant Kumar Jalan and Others – [2021 SCC Online SC 764]
Ratna Commercial Enterprises Ltd. vs. Vasutech Ltd. – [AIR 2008 Del 99]
Saleem Bhai vs. State of Maharashtra – [(2003) 1 SCC 557]
Sopan Sukhdeo Sable and Ors. vs. Assistant Charity Commissioner and Others – [(2004) 3 SCC 137]
State of Orissa v. Madan Gopal Rungta, AIR 1952 SC 12
T. Arivandandam vs. T.V. Satyapal & Anr. – [(1977) 4 SCC 467]
Tek Singh vs. Shashi Verma and Another, [(2019) 16 SCC 678]

JUDGMENT

Nagarathna, J. – This appeal is preferred by defendant no.1 in C.S. No. 1065 of 2009 filed before the Court of Civil Judge (Senior Division) Bhubaneswar, by assailing order dated 19^th January, 2016 passed by the High Court of Orissa at Cuttack in WP(C) No.7059 of 2013. By the said order, the application filed by the appellant herein/defendant no.1 under Order VII Rule 11 of the Code of Civil Procedure 1908 (for short, the ‘CPC’) has been ordered to be reconsidered by the District Court at Khurda, Bhubaneswar (revisional court) by restoring C.R.P. No.5 of 2012 filed by the defendant no.1 herein. The said revision was filed by defendant no.1 being aggrieved by the dismissal of the said application being C.S. No. 1065 of 2009 by the trial court, namely, the Court of Civil Judge (Senior Division), Bhubaneswar, praying for rejection of the plaint under Order VII Rule 11 of the CPC.

2. For the sake of convenience, the parties herein shall be referred to in terms of their rank and status before the trial court.

3. Briefly stated, the facts of the case are that, respondent no.1 herein/plaintiff had filed a suit against the appellant herein/defendant no.1 and respondent no.2 herein/defendant no.2 seeking the following reliefs:

“(i) Let it be declared that the plaintiff had handed over the cheque to Sri Dilip Das, Advocate as a security;

(ii) Let it be declared that the said cheque has been illegally handed over by the defendant no.2 to the defendant no.1 by violating term and condition of the memorandum of understanding dated 17.01.2009;

(iii) Let it be declared that the plaintiff is not liable to give delivery of 3876 MT of iron ore fines to the defendant no.1 nor the cheque amount since the defendant no.1 has failed to save the plaintiffs plot from cancellation;

(iv) Let the cost of the suit be decreed in favour of the plaintiff and against the defendants;

(v) Let any other decree/decrees be passed in favour of the plaintiff to which the plaintiff is entitled to under law and equity.”

4. According to the plaintiff, which is a Private Limited Company, incorporated under the provisions of the Companies Act, 1956, it is engaged in the business of export of iron ore from Paradeep Port while defendant no.1 is also a Company incorporated under the provisions of the Companies Act, 1956, having its registered office at Kanpur, Uttar Pradesh, and also having its Branch at Kolkata in West Bengal. Defendant no.1 carries on business at Paradeep Port, Orissa in supplying and exporting iron ore from the said Port to various destinations overseas. That plaintiff had a plot namely Plot No.RS-4 on licence from Paradeep Port Trust Authority for the purpose of its export business in iron ore. That defendant no.1 and the plaintiff had entered into a Cooperation Agreement on 24^th December, 2007 but according to the plaintiff, the same was not given effect to. That defendant no.1, through its Managing Director Sunil Banna, tried to blackmail the plaintiff in various ways and threatened him that he would intimate Paradeep Port Trust Authority that the plaintiff had sub-let his licence in respect of Plot No.RS-4 to defendant no.1 by violating the terms and conditions of licence.

According to the plaintiff, defendant no.1 in January 2009 stated that plaintiff had illegally exported stock of 4000 MT of iron ore and when the plaintiff through its Managing Director refuted the claim of defendant no.1, a complaint was lodged at Paradeep Police Station on 8^th January, 2009 and thereafter, on 10^th January, 2009 alleging theft of 4000 MT iron ore fines belonging to defendant no.1.

According to the plaintiff, defendant no.1 lodged another false complaint with the Paradeep Port Trust Authority to the effect that the plaintiff was violating the terms and conditions of his licence in respect of Plot No.RS-4 which had been sub-let to defendant no.1 and a copy of the Cooperation Agreement dated 24^th December, 2007 which was in fact not acted upon was also filed along with complaint. Acting on the said complaint, Paradeep Port Trust Authority had issued show cause notice to the plaintiff on 20^th January, 2009 and thereafter, cancelled the licence of the plaintiff vis-à-vis Plot No.RS-4 by letter dated 18^thFebruary, 2009.

5. Being apprehensive of the cancellation of the licence to Plot No.RS-4, the Managing Director of the plaintiff Company agreed to the proposal of the representative of defendant no.1 viz., Rabindra Banthia, that in case plaintiff agreed to supply 3876MT of iron ore fines to defendant no.1, they would manage to withdraw their complaint and would save the licence of the plot from cancellation.

6. That in January, 2009, plaintiff had outstanding dues of Rs.21.50 lakhs against defendant no.1 and at the behest of defendant no.2, a Memorandum of Understanding (for short, ‘MoU’) was arrived at on 17^th January, 2009 on certain terms and conditions that defendant no.1 would take steps to protect the licence of the plot given to the plaintiff from cancellation in seven days’ time and it was further agreed that defendant no.1 would give a cheque of Rs.21.50 lakhs to the plaintiff towards the outstanding dues to the plaintiff. Similarly, the plaintiff would issue a cheque for Rs.56 lakhs in favour of defendant no.1 and the same would remain in the custody of Sri Dilip Das, Advocate – defendant no.2 as security, which is equivalent to the cost of 3876 MT of iron ore. The plaintiff would supply 3786 MT of iron ore fines to defendant no.1 if defendant no.1 succeeded in protecting the licence of the said plot of the plaintiff from being cancelled. Accordingly, plaintiff furnished a cheque for Rs.56 lakhs in favour of defendant no. 1 and handed over the same to Sri Dilip Das, Advocate – defendant no.2 in the suit, as security. Defendant no.2 wrote a letter to the Managing Director of the plaintiff on 20^th January, 2009 intimating therein that both cheques would be in his custody and the cheque drawn by the plaintiff amounting to Rs.56 lakhs would not be handed over to defendant no.1 unless defendant no.1 fulfilled its undertaking as per the MoU dated 17^th January, 2009. Further, the cheque would be handed over to defendant no.1 only when the plot licence of the plaintiff was saved from cancellation by defendant no.1 and if the plaintiff failed to supply the iron ore to defendant no.1.

7. According to the plaintiff, defendant no.1 did not take any step to save the licence of the plot of the plaintiff from cancellation and the licence was cancelled on the complaint of defendant no.1 by letter dated 18^th February, 2009 by the Paradeep Port Trust Authority. According to the plaintiff, the question of handing over the cheque to defendant no.1 by defendant no.2 did not arise at all. Plaintiff had approached the High Court in a writ petition vis-à-vis the cancellation of the licence in respect of the plot and an order of stay on the cancellation was granted.

It is the further case of the plaintiff that when the matter stood thus, defendants no.1 and 2 colluded with each other and defendant no.2 committed breach of trust and betrayed the plaintiff as the cheque for Rs.56 lakhs was handed over by defendant no.2 to defendant no.1. On receipt of the cheque, defendant no.1 pressurized the plaintiff to either supply 3876 MT iron ore fines or they would present the cheque for encashment. Since the plaintiff did not agree to supply iron ore, defendant no.1 presented the cheque for encashment but the same was dishonoured as the plaintiff had issued stop payment instructions to the Bank on coming to know about the collusion between defendant no.1 and defendant no. 2. Thereafter, defendant no.1 issued notice under Section 138 of the Negotiable Instruments Act, 1881 (for short, the ‘N.I. Act’) through their advocate on 10^th June, 2009 to the plaintiff through its Managing Director, to which a reply was sent on 23^rd June, 2009. It was, inter alia, stated in the reply that the defendants were trying to harass the plaintiff and having no other alternative, the plaintiff filed the suit seeking a declaration that the cheque which was dishonoured was handed over by the plaintiff to defendant no.2 as a security and that defendant no. 1 had not acquired any right over the said cheque as the plaintiff had no liability to discharge vis-à-vis defendant no.1. It was averred in the plaint that defendant no.1 was liable to pay a sum of Rs.21.50 lakhs to the plaintiff towards its outstanding dues for which a cheque was issued on 17^th January, 2009 which was also kept with defendant no.2 and in respect of which the plaintiff reserved its right to initiate appropriate proceeding for recovery of the said amount from defendant no.1. There were further correspondences between the parties and ultimately the aforementioned suit was filed by the plaintiff against the defendants.

8. On receipt of the summons sent by the trial court, defendant no.1 appeared and filed an application under Order VII Rule 11 of CPC seeking rejection of the plaint on the ground that the suit was not maintainable being barred under the provisions of the Specific Relief Act, 1963 (for short, the ‘SR Act’) and secondly, the suit was frivolous and instituted as a subterfuge to defeat the legitimate claim of defendant no.1 without having any right to sue. Objection was filed to the said application by the plaintiff. The said application was considered by the trial court and dismissed by refusing to reject the plaint.

9. Being aggrieved, defendant no.1 preferred C.R.P. No.5 of 2012 before the Court of District Judge, Khurda at Bhubaneswar under Section 115 of the CPC. By order dated 20^th March, 2013, the revisional court allowed the said revision petition, set aside the order of the trial court refusing to reject the plaint, and rejected the plaint. Being aggrieved, the plaintiff filed W.P.(C) No.7059 of 2013 before the High Court of Orissa at Cuttack which set aside the order of the revisional court and remanded the matter to the said court for fresh consideration by holding that the revisional court had exceeded its jurisdiction in rejecting the plaint. Being dissatisfied with the order of the High Court defendant no.1 has preferred this appeal.

10. We have heard Mrs. Rajdipa Behura, learned counsel for the appellant and Sri Anirudh Sanganeria, learned counsel for the respondents and perused the material on record.

11. Learned counsel for the appellant submitted that the High Court was not right in setting aside the order passed by the revisional court and remanding the matter to the said court for reconsideration of the application filed by the appellant under Order VII Rule 11 of CPC on the premise that revisional court had exceeded its jurisdiction. It was contended that the application under Order VII Rule 11 of the CPC was filed by the appellant/defendant no.1 in the suit filed by respondent no.1/plaintiff seeking rejection of the plaint on the ground that the prayers sought in the suit could not have been granted and the suit as such was not maintainable and was barred under the provision of Section 41 of the SR Act. Further there was no cause of action for the plaintiff to file the suit against the defendants. The trial court did not appreciate the reasons as to why an application was filed by defendant no.1 seeking rejection of the plaint and dismissed the same. Being aggrieved the appellant/defendant no.1 filed revision petition in C.R.P. No.5 of 2012 before the District Court having regard to Section 115 of the CPC and particularly proviso thereto as, if the application filed by defendant no. 1 under Order VII Rule 11 of CPC was to be allowed by the revisional court, then, the proceedings before the trial court would conclude. The revisional court rightly appreciated the case of appellant herein and rejected the plaint. However, the High Court on a writ petition filed by the plaintiff held that the revisional court while exercising its power of revision had exceeded its jurisdiction by rejecting the plaint instead of remanding the matter to the trial court to do so. While adverting to Section 115 of the CPC [vide Orissa Act 26 of 1991, Section 2 (w.e.f. 7^th November, 1991)], learned counsel for the appellant contended that when the trial court failed to exercise jurisdiction vested in it and refused to reject the plaint by allowing the application filed under Order VII Rule 11 of the CPC by the appellant herein, the revisional court rightly allowed the said revision and rejected the plaint which finally disposed of the suit in terms of the second proviso to the said Section. It was contended that the High Court has not taken into consideration the Orissa amendment and has further misconstrued the object and import of Section 115 of the CPC vis-à-vis the provisions of the revisional court and has erroneously set aside the order of the revisional court rejecting the plaint and remanding the matter to the revisional court for fresh consideration.

12. Drawing our attention to the order of the High Court, it was contended that the said order is contrary to Section 115 of CPC (Orissa amendment) and hence the impugned order may be set aside and the order of the revisional authority may be restored. It was contended by learned counsel for the appellant that as against the order of the revisional authority rejecting the plaint, respondent no.1 herein/plaintiff could not have filed a writ petition.

13. Per contra, learned counsel for respondent no.1/plaintiff supported the impugned order passed by the High Court and contended that when a plaint is rejected by allowing an application filed under Order VII Rule 11 of CPC, it results in a decree being passed within the meaning of Section 2(2) of the CPC and hence the High Court directed the revisional court to consider the matter afresh and if necessary, to remand the matter to the trial court for considering the aspect regarding rejection of plaint. Learned counsel for respondent no. 1/plaintiff contended that there is no merit in this appeal and the same may be dismissed.

14. Having heard learned counsel for the respective parties the following points would arise for our consideration:

(a) Whether the High Court was justified in setting aside the order passed by the revisional court in C.R.P. No.5 of 2012 and thereby remanding the matter to the said court for reconsideration on the premise that the revisional court had exceeded its jurisdiction in rejecting the plaint?

(b) What order?

The reliefs sought by the plaintiff in the suit have been extracted above.

15. Having regard to the averments in the plaint summarised above and the reliefs sought in the plaint, defendant no. 1/appellant herein filed an application under Order VII and Rule 11 of CPC seeking rejection of the plaint. The rejection of the plaint was sought for three reasons :- firstly, the suit was barred under the provisions of the SR Act; secondly, the suit was frivolous and was filed as a subterfuge to defeat the legitimate claim of defendant no.1; and thirdly, the suit has been deliberately undervalued. Objections were filed to the said application of defendant no.1. By order dated 19^th May, 2012, the trial court dismissed the said application. Being aggrieved, defendant no.1 filed C.R.P. No.5 of 2012 under Section 115 (Orissa amendment).

16. The revisional court considered the revision and allowed the application filed under Order VII Rule 11 of CPC which had the effect of finally disposing of the suit. It is against the said order that the plaintiff filed the writ petition before the High Court which was allowed and the matter was remanded to the revisional court for fresh consideration with an observation that the revisional court may, in turn, remand the matter to the trial court if necessary. This was on the premise that the revisional court had exceeded the jurisdiction vested in it by acting illegally in allowing the application filed under Order VII Rule 11 of CPC.

17. In order to consider the correctness of the impugned order passed by the High Court, it would be useful to refer to Section 115 of the CPC as well as the Orissa Amendment. For immediate reference, the same are extracted as under:

“115. Revision – (1) The High Court may call for the record of any case which has been decided by any Court subordinate to such High Court and in which no appeal lies thereto, and if such subordinate Court appears-

(a) to have exercised a jurisdiction not vested in it by law, or

(b) to have failed to exercise a jurisdiction so vested, or

(c) to have acted in the exercise of its jurisdiction illegally or with material irregularity, the High Court may make such order in the case as it thinks fit:

Provided that the High Court shall not, under this Section, vary or reverse any order made, or any order deciding an issue, in the course of a suit or other proceeding, except where 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.

(2) The High Court shall not, under this Section, vary or reverse any decree or order against which an appeal lies either to the High Court or to any Court subordinate thereto.

(3) A revision shall not operate as a stay of suit or other proceeding before the Court except where such suit or other proceeding is stayed by the High Court.

Explanation.-In this Section, the expression “any case which has been decided” includes any order made, or any order deciding an issue in the course of a suit or other proceeding.”

ORISSA AMENDMENT

“115. Revision- The High Court, in cases arising out of original suits or other proceedings of the value exceeding one lakh rupees, and the District Court, in any other case including a case arising out of an original suit or other proceedings instituted before the commencement of the Code of Civil Procedure (Orissa Amendment) Act, 1991 may call for the record of any case which has been decided by any Court subordinate to the High Court or the District Court, as the case may be, and in which no appeal lies thereto, and if such Subordinate Court appears –

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

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

the High Court or the District Court, as the case may be, may make such order in the case as it thinks fit;

Provided that in respect of cases arising out of original suits or other proceedings of any valuation decided by the District Court, the High Court alone shall be competent to make an order under this Section;

Provided further that the High Court or the District Court shall not, under this Section, vary or reverse any order, including an order deciding an issue, made in the course of a suit or other proceedings, except where –

(i) the order, if so varied or reversed would finally dispose 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 was made.

Explanation – In this Section, the expression ‘any case which has been decided’ includes any order deciding an issue in the course of a suit or other proceeding”.”

18. On a perusal of the same it is noted that the Orissa amendment differs from the main Section 115 of CPC in the following ways:

(i) Firstly, the main Section 115 deals with revisional powers of the High Court only, whereas, Section 115 of CPC (Orissa amendment) confers the power of revision not only on the High Court but also on the District Court which may call for the record of any case which has been decided by any court subordinate to the High Court or the District Court, as the case may be, and in which no appeal lies thereto, if such subordinate court appears – (a) to have exercised a jurisdiction not vested in it by law; or (b) to have failed to exercise a jurisdiction, so vested; or (c) to have acted in the exercise of its jurisdiction illegally or with material irregularity. In such a case, the High Court or the District Court, as the case may be, may make such order in the case as it thinks fit.

(ii) Secondly, sub-section (2) of Section 115 of the main provision, states that the High Court shall not, under the said Section, vary or reverse any decree or order against which an appeal lies either to the High Court or to any Court subordinate thereto. But under the second proviso to Section 115 of CPC (Orissa amendment), the High Court or the District Court shall not under the said Section, vary or reverse any order, including an order deciding an issue, made in the course of a suit or other proceeding, except where

(i) the order, if so varied or reversed would finally dispose 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 was made.

Thus, the first proviso to main Section 115 of CPC restricts the revisional power of the High Court inasmuch as a revision is maintainable only if it is filed by a party who is aggrieved by an order passed by the court subordinate to the High Court on an order deciding an issue which, had it been made in favour of the party applying for revision, would have finally disposed of the suit or other proceeding. But as per the second proviso to Section 115 of CPC (Orissa amendment), the High Court or the District Court, as the case may be, under the said Section can vary or reverse any order including an order deciding an issue, made in the course of a suit or other proceeding only if the order if so varied or reversed would finally dispose of the suit or other proceeding or the order if allowed to stand would occasion a failure of justice or cause irreparable injury to the party against whom it was made. In other words, under Orissa amendment to Section 115 of CPC, an express power is conferred on the High Court or the District Court, as the case may be, being the revisional courts, to vary or reverse an order of the court subordinate thereto only when it would finally dispose of the suit or other proceedings or if the impugned order is allowed to stand would occasion a failure of justice or cause irreparable injury to the party against whom it was made.

19. It would also be pertinent to mention that the instant suit was filed in the year 2009 and therefore the Orissa amendment to Section 115 CPC vide Orissa Act 26 of 1991, Section 2, would be applicable. However, by Orissa Act 14 of 2010, Sub-Section 2, Section 115 was amended by the Orissa Legislature and second proviso to Section 115 has been amended and Sub-Section 2 of Section 115 has been added which states that the High Court or District Court, as the case may be, shall not under this Section, vary or reverse any order including an order deciding an issue, made in the course of a suit or other proceeding, except where the order, if it has been made in favour of the party applying for revision, would finally dispose the suit or other proceeding.

20. Further, clause 1 of the second proviso of Section 115 has been omitted by the amendment made in the year 2010 and Sub-Section 3 has been added. This provision states that are vision shall not operate as a stay of suit or other proceeding before the Court except where such suit or other proceeding is stayed by the High Court or District Court, as the case may be. Sub-Section 1 of Section 115 is in pari materia with the Orissa Amendment of 1991 except its reference to the Orissa Amendment Act of 2010. For immediate reference, Section 115 of the CPC as per the 2010 amendment made (Orissa Amendment) is extracted as under:

“Amendment of Section 115. – In the Code of Civil Procedure, 1908 (5 of 1908), for Section 115, the following Section shall be substituted, namely:-

115. Revision.-(l) The High Court, in cases arising out of original suits or other proceedings of the value exceeding five lakhs rupees and the District Court, in any other cases, including a case arising out of an original suit or other proceedings instituted before the commencement of the Code of Civil Procedure (Orissa Amendment) Act, 2010, may call for the record of any case which has been decided by any Court subordinate to the High Court or the District Court, as the case may be, and in which no appeal lies thereto, and if such subordinate Court appears-

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

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

(c) to have acted in the exercise of its jurisdiction illegally or with material irregularity, the High Court or the District Court, as the case may be, may make such order in the case as it thinks fit:

(2) The High Court or the District Court, as the case may be, shall not under this Section, vary or reverse any order, including an order deciding an issue, made in the course of a suit or other proceedings, except where the order, if it had been made in favor of the party applying for revision, would have finally disposed of the suit or other proceedings.

(3) A revision shall not operate as a stay of suit or other proceeding before the Court except where such suit or other proceeding is stayed by the High Court or District Court, as the case may be.

Explanation-In this Section, the expression, “any case which has been decided” includes any order deciding an issue in the course of a suit or other proceeding.”.

[Vide the Orissa Act 14 of 2010, s. 2]”

21. Therefore, we hold that the High Court was not right in observing that the revisional court had exceeded its jurisdiction and it could not have allowed the application filed under Order VII Rule 11 of CPC and thereby reversed the order of the trial court and finally disposed of the suit. In fact, the High Court has failed to appreciate the second proviso to Section 115 of CPC (Orissa amendment) in its true perspective. The revisional court, being the High Court or the District Court, as the case may be, can reverse an order which would finally dispose of the suit or other proceeding. That is exactly what has been done by the revisional court being the District Court in the petition being C.R.P. No.5 of 2012.

22. Hence, we find that the High Court was not justified in setting aside the said order and remanding the matter to the revisional court (District Court) to consider afresh, the application filed by defendant no. 1/appellant herein under Order VII Rule 11 of CPC seeking rejection of the plaint. In fact, we would observe that exercise of jurisdiction by the revisional court in the instant case is in accordance with second proviso to Section 115 of CPC (Orissa amendment).

In this regard, we could also usefully refer to the following

decisions: –

(a) Gajendragadkar, CJ., in a judgment passed by the five Judges Bench of this Court in Pandurang Dhondi Chougule and Others vs. Maruti Hari Jadhav and Others – [AIR 1966 SC 153] dealt with the question of jurisdiction under Section 115 CPC, as follows:-

“10. The provisions of Section 115 of the Code have been examined by judicial decisions on several occasions. While exercising its jurisdiction under Section 115, it is not competent to the High Court to correct errors of fact however gross they may, or even errors of law, unless the said errors have relation to the jurisdiction of the court to try the dispute itself. As clauses (a), (b) and (e) of Section 115indicate, it is only in cases where the subordinate court has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested, or has acted in the exercise of its jurisdiction illegally or with material irregularity that the revisional jurisdiction of the High Court can be properly invoked. It is conceivable that points of law may arise in proceedings instituted before subordinate courts which are related to questions of jurisdiction. It is well settled that a plea of limitation or a plea of res judicata is a plea of law which concerns the jurisdiction of the court which tries the proceedings. A finding on these pleas in favour of the party raising them would oust the jurisdiction of the court, and so, an erroneous decision on these pleas can be said to be concerned with questions of jurisdiction which fall within the purview of Section 115 of the Code. But an erroneous decision on a question of law reached by the subordinate court which has no relation to questions of jurisdiction of that court, cannot be corrected by the High Court under Section 115.”

(b) Nariman, J. while discussing Section 115 CPC and proviso thereto held that revision petitions filed under Section 115 CPC are not maintainable against interlocutory orders in the case of Tek Singh vs. Shashi Verma and Another -[(2019) 16 SCC 678]. The following observations were made in the said case:-

“6. Even otherwise, it is well settled that the revisional jurisdiction under Section 115 CPC is to be exercised to correct jurisdictional errors only. This is well settled. In DLF Housing & Construction Co. (P) Ltd. v. Sarup Singh [DLF Housing & Construction Co. (P) Ltd. v. Sarup Singh, (1969) 3 SCC 807 : (1970) 2 SCR 368] this Court held: (SCC pp. 811-12, para 5)

“5. The position thus seems to be firmly established that while exercising the jurisdiction under Section 115, it is not competent to the High Court to correct errors of fact however gross or even errors of law unless the said errors have relation to the jurisdiction of the court to try the dispute itself. Clauses (a) and (b) of this section on their plain reading quite clearly do not cover the present case. It was not contended, as indeed it was not possible to contend, that the learned Additional District Judge had either exercised a jurisdiction not vested in him by law or had failed to exercise a jurisdiction so vested in him, in recording the order that the proceedings under reference be stayed till the decision of the appeal by the High Court in the proceedings for specific performance of the agreement in question. Clause (c) also does not seem to apply to the case in hand. The words “illegally” and “with material irregularity” as used in this clause do not cover either errors of fact or of law; they do not refer to the decision arrived at but merely to the manner in which it is reached. The errors contemplated by this clause may, in our view, relate either to breach of some provision of law or to material defects of procedure affecting the ultimate decision, and not to errors either of fact or of law, after the prescribed formalities have been complied with.”

Therefore, in the instant case the High Court was not right in holding that the revisional court had no jurisdiction to reject the plaint filed under Order VII Rule 11 of CPC. The reasoning of the High Court is contrary to the express proviso of Section 115 (Orissa Amendment).

23. No doubt rejection of a plaint is a decree within the meaning of Section 2(2) of CPC and an appeal lies from every decree passed by any court exercising original jurisdiction to the Court authorised to hear appeals from a decision of such court. However, it must be borne in mind that when a revisional court rejects a plaint, in substance, an application filed under Order VII Rule 11 is being allowed. Under such circumstances, the remedy by way of a writ petition under Article 227 of the Constitution could be availed and respondent no. 1/plaintiff has resorted to the said remedy in the instant case; although if the plaint had been rejected by the trial court i.e. court of original jurisdiction, it would have resulted in a right of appeal under Section 96 of CPC.

24. Having regard to the second proviso to Section 115 of CPC (Orissa amendment), a revisional court while allowing the application filed under Order VII Rule 11 of CPC would in substance reject the plaint but since the said decree is not passed by the court of original jurisdiction, namely the trial court, the remedy by way of writ petition under Article 227 of the Constitution would be available to the aggrieved party and respondent no. 1 has availed the said remedy.

25. Having held as above, we now proceed to consider, whether, the revisional court (District Court) was justified in allowing the application filed under Order VII Rule 11 of CPC and thereby rejecting the plaint filed by the plaintiff/respondent no.1 herein. Before proceeding further, it would be useful to refer to the following judgments of this Court in respect with Order VII Rule 11 CPC:

a) In T. Arivandandam vs. T.V. Satyapal & Anr. – [(1977) 4 SCC 467], this Court observed, in the following words, that while considering an application under Order VII Rule 11 CPC what is required to be decided is whether the plaint discloses a real cause of action, or something purely illusory:-

“5. We have not the slightest hesitation in condemning the petitioner for the gross abuse of the process of the court repeatedly and unrepentently resorted to. From the statement of the facts found in the judgment of the High Court, it is perfectly plain that the suit now pending before the First Munsif’s Court, Bangalore, is a flagrant misuse of the mercies of the law in receiving plaints. The learned Munsif must remember that if on a meaningful – not formal – reading of the plaint it is manifestly vexatious, and meritless, in the sense of not disclosing a clear right to sue, he should exercise his power under Order 7, Rule 11 CPC taking care to see that the ground mentioned therein is fulfilled. And, if clever drafting has created the illusion of a cause of action, nip it in the bud at the first hearing by examining the party searchingly under Order 10, CPC. An activist Judge is the answer to irresponsible law suits. The trial courts would insist imperatively on examining the party at the first hearing so that bogus litigation can be shot down at the earliest stage. The Penal Code is also resourceful enough to meet such men, (Cr. XI) and must be triggered against them. In this case, the learned Judge to his cost realised what George Bernard Shaw remarked on the assassination of Mahatma Gandhi: “It is dangerous to be too good.”

b) In Azhar Hussain vs. Rajiv Gandhi – [1986 Supp SCC 315], this Court discussed the very purpose of the power conferred under Order VII Rule 11 CPC by observing thus:

“12. The whole purpose of conferment of such power is to ensure that a litigation which is meaningless, and bound to prove abortive should not be permitted to occupy the time of the Court, and exercise the mind of the respondent. The sword of Damocles need not be kept hanging over his head unnecessarily without point or purpose. Even if an ordinary civil litigation, the Court readily exercises the power to reject a plaint, if it does not disclose any cause of action.”

c) In Sopan Sukhdeo Sable and Ors. vs. Assistant Charity Commissioner and Others – [(2004) 3 SCC 137], it was held that Rule 11 of Order VII lays down an independent remedy made available to the defendant to challenge the maintainability of the suit itself, irrespective of his right to contest the same on merits. The law ostensibly does not contemplate any stage when the objections can be raised, and also does not say in express terms about the filing of a written statement. It was held that the word ‘shall’ is used to clearly imply that a duty is cast on the Court to perform its obligations in rejecting the plaint when the same is hit by any of the infirmities provided in the four clauses of Rule 11, even without intervention of the defendant. Elaborating on the aspect of cause of action by quoting I.T.C Ltd. vs. Debts Recovery Appellate Tribunal and Ors. – [(1998) 2 SCC 70], it was held that the basic question to be decided while dealing with an application filed under Order VII Rule 11 of the Code is whether a real cause of action has been set out in the plaint or something purely illusory has been stated with a view to get out of Order VII Rule 11 of the Code.

d) This Court in Liverpool & London S.P. & I Assn. Ltd. vs. M.V. Sea Success I & Anr. – [(2004) 9 SCC 512] held that a plaint must be construed as it stands without any amendments. The same is extracted herein as follows-

“139. Whether a plaint discloses a cause of action or not is essentially a question of fact. But whether it does or does not, must be found out from reading the plaint itself. For the said purpose the averments made in the plaint in their entirety must be held to be correct. The test is as to whether if the averments made in the plaint are taken to be correct in its entirety, a decree would be passed.”

e) We could allude to the exposition of this Court in Madanuri Sri Rama Chandra Murthy vs. Syed Jalal -[(2017) 13 SCC 174], wherein it was held as under:-

“7……The averments of the plaint have to be read as a whole to find out whether the averments disclose a cause of action or whether the suit is barred by any law. It is needless to observe that the question as to whether the suit is barred by any law, would always depend upon the facts and circumstances of each case. The averments in the written statement as well as the contentions of the defendant are wholly immaterial while considering the prayer of the defendant for rejection of the plaint. Even when, the allegations made in the plaint are taken to be correct as a whole on their face value, if they show that the suit is barred by any law, or do not disclose cause of action, the application for rejection of plaint can be entertained and the power under Order VII Rule 11 of CPC can be exercised. If clever drafting of the plaint has created the illusion of a cause of action, the court will nip it in the bud at the earliest so that bogus litigation will end at the earlier stage.”

f) In Dahiben vs. Arvindbhai Kalyanji Bhanusali (Gajra) Dead through Legal Representatives and Others – [(2020) 7 SCC 366], Indu Malhotra, J., while dealing with an appeal against an order allowing rejection of a suit at the threshold, had an occasion to consider various precedents discussing the intent and purpose of Order VII Rule 11 CPC while setting out principles in relation to the same. It was held that the provision of Order VII Rule 11 is mandatory in nature and that the plaint “shall” be rejected if any of the grounds specified in clause (a) to (e) is made out. If the Court finds that the plaint does not disclose a cause of action, or that the suit is barred by any law, the Court has no option, but to reject the plaint. The relevant portion of the judgment is extracted as below:-

“23.1XXXXX

23.2 The remedy under Order 7 Rule 11 CPC is an independent and special remedy wherein the court is empowered to summarily dismiss a suit at the threshold, without proceedings to record evidence, and conducting a trial, on the basis of the evidence adduced, if it is satisfied that the action should be terminated on any of the grounds contained in this provision.

23.3 The underlying object of Order VII Rule 11 (a) is that if in a suit, no cause of action is disclosed, or the suit is barred by limitation under Rule 11 (d), the Court would not permit the plaintiff to unnecessarily protract the proceedings in the suit. In such a case, it would be necessary to put an end to the sham litigation, so that further judicial time is not wasted.

23.4 In Azhar Hussain v. Rajiv Gandhi, this Court held that the whole purpose of conferment of powers under this provision is to ensure that a litigation which is meaningless, and bound to prove abortive, should not be permitted to waste judicial time of the court.

23.5 The power conferred on the court to terminate a civil action is, however, a drastic one, and the conditions enumerated in Order VII Rule 11 are required to be strictly adhered to.

23.6 Under Order VII Rule 11, a duty is cast on the Court to determine whether the plaint discloses a cause of action by scrutinizing the averments in the plaint, read in conjunction with the documents relied upon, or whether the suit is barred by any law.

23.7 XXXXX

23.8 Having regard to Order 7 Rule 14, the documents filed with the plaint, are required to be taken into consideration for deciding the application under Order 7 Rule 11 (a). When a document referred to in the plaint, forms the basis of the plaint, it should be treated as a part of the plaint.

23.9 In exercise of power under this provision, the Court would determine if the assertions made in the plaint are contrary to statutory law, or judicial dicta, for deciding whether a case for rejecting the plaint at the threshold is made out.

23.10 At this stage, the pleas taken by the defendant in the written statement and application for rejection of the plaint on the merits, would be irrelevant, and cannot be adverted to, or taken into consideration.”

g) In a recent judgment of Rajendra Bajoria and Others vs. Hemant Kumar Jalan and Others – [2021 SCC Online SC 764], this Court while elucidating on the underlying object of Order VII Rule 11 CPC and considering various precedents of this Court, held as under : –

“20. It could thus be seen that this Court has held that the power conferred on the court to terminate a civil action is a drastic one, and the conditions enumerated under Order VII Rule 11 of CPC are required to be strictly adhered to. However, under Order VII Rule 11 of CPC, the duty is cast upon the court to determine whether the plaint discloses a cause of action, by scrutinizing the averments in the plaint, read in conjunction with the documents relied upon, or whether the suit is barred by any law. This Court has held that the 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. It has been held that in such a case, it will be necessary to put an end to the sham litigation so that further judicial time is not wasted.”

26. Relying on the case of Hardesh Ores (P.) Ltd. vs. Hede & Co. – [(2007) 5 SCC 614], it was held that it is not permissible to cull out a sentence or a passage, and to read it in isolation. It is the substance, and not merely the form, which has to be looked into. The plaint has to be construed as it stands, without addition or subtraction of words. Further delving upon the ratio in D. Ramachandran vs. R.V. Janakiraman – [(1999) 3 SCC 367], it was held that if the allegations in the plaint prima facie show a cause of action, the court cannot embark upon an enquiry whether the allegations are true in fact.

27. It was further held that if on a meaningful reading of the plaint, it is found that the suit is manifestly vexatious and without any merit, and does not disclose a right to sue, the court would be justified in exercising the power under Order VII Rule 11 CPC. Placing reliance on Saleem Bhai vs. State of Maharashtra – [(2003) 1 SCC 557], it was held that the power under Order VII Rule 11 CPC may be exercised by the Court at any stage of the suit, either before registering the plaint or after issuing summons to the defendant, or before conclusion of the trial.

28. On a reading of the plaint, in the instant case it is noted that it discloses a cause of action inasmuch as the MoU dated 17^th January, 2009, entered into between the plaintiff and defendant no. 1 in the presence of defendant no.2 and the acts done pursuant to the said MoU is the basis for the grievance of the plaintiff. According to the plaintiff, a cheque for Rs. 56 lakhs was issued by him in favour of defendant no.1 and handed over to Sri Dilip Das, Advocate – defendant no.2 as security with an understanding that the said cheque will not be handed over by defendant no.2 to defendant no.1 unless defendant no.1 fulfils its undertaking and carries out the responsibility of saving the licence to plot No. RS-4, issued in favour of the plaintiff by the Paradeep Port Trust Authority, from being cancelled. As a result, the plaintiff would continue to remain as the licensee of the Paradeep Port Trust Authority vis-a-vis the said plot. According to the plaintiff, defendant no.1 did not take any step to save licence of the plaintiff from cancellation and it was cancelled on the basis of the complaint made by defendant no.1 vide letter dated 18^th February, 2009, by the Paradeep Port Trust Authority. Hence, the question of defendant no.2 handing over the cheque for Rs. 56 lakhs to defendant no.1 did not arise. Further, plaintiff was pressurized to either supply 3876 MT of iron ore fines to defendant no.1 or else defendant no.1 would present the cheque for encashment. Since plaintiff did not agree to the illegal demand of defendant no.1, the cheque for Rs.56 lakhs which had been handed over by defendant no.2 to defendant no.1, was presented by defendant no.1 and it was dishonoured. According to the Plaintiff, defendant no.2 and defendant no.1 colluded with each other to make an illegal gain and defendant no.2 could not have handed over the cheque to defendant no.1. Hence, a letter was written to the Bank directing them to stop the payment of the cheque and the same was conveyed to the defendants. The said cheque was dishonoured. Defendant no.1 issued notice under Section 138 of NI Act dated 10^th June, 2009, to the plaintiff through its Managing Director, to which a reply was given on 23^rd June, 2009. According to the plaintiff, defendant no.1 owes the plaintiff Rs. 21.50 lakhs but the plaintiff does not have to pay anything to defendant no.1. Hence, defendant no.1 is duty bound to return the cheque to the plaintiff but, on the other hand, the defendants are trying to harass the plaintiff by presenting the cheque and hence certain reliefs were sought in the suit. The relief of declaration was sought to the effect that the cheque handed over by the plaintiff to defendant no.2 was as a security; that the cheque had been illegally handed over by defendant no.2 to defendant no. 1 in violation of the terms and conditions of the MoU dated 17^th January, 2009 and that the plaintiff is neither liable to deliver 3876 MT of iron ore fines to defendant no.1 nor to pay an amount of Rs. 56 lakhs since defendant no.1 had failed to save the licence of plaintiffs plot from cancellation by the Paradeep Port Trust Authority.

29. At the outset, we hold that on perusal of the plaint averments, the plaintiff has indeed made out a cause of action for filing the suit. In fact, in para 2 of the application filed under Order VII Rule 11 CPC, defendant no.1 has also encapsulated the averments made in the plaint. Therefore, on that score the plaint cannot be rejected.

30. The other contention of defendant no.1 is that from the pleadings and averments in the plaint and the prayers sought therein, it appears that only certain declaratory reliefs have been sought and further, consequential reliefs have been omitted to be prayed. Hence, the suit is barred under the provisions of the SR Act and is liable to be dismissed and the plaint is liable to be rejected under Order VII Rule 11 CPC.

31. In the objections filed to the application under order VII Rule 11 CPC, it has been averred that the plaint averments would clearly show a cause of action for filing the suit and further that the suit is not barred by any law. Further, the declaratory reliefs have been valued properly and appropriate court fee has been paid. Hence, the application is liable to be rejected.

Thus, the main thrust of the application seeking rejection of the plaint is that apart from the fact that the plaint does not disclose a cause of action which has been negated by the revisional court and rightly so, plaintiff has sought only declaratory reliefs and has not sought further or consequential reliefs. In the circumstances, the suit is barred under the provisions of the SR Act.

Section 34 of the SR Act reads as under:

“34. Discretion of court as to declaration of status or right.-Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right, and the court may in its discretion make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief:

Provided that no court shall make any such declaration where the plaintiff, being able to seek further relief than a mere declaration of title, omits to do so.

Explanation.-A trustee of property is a “person interested to deny” a title adverse to the title of some one who is not in existence, and whom, if in existence, he would be a trustee.”

The proviso to Section 34 states that no court can make any declaration where the plaintiff, being able to seek further relief than mere declaration of title, omits to do so. The said question will have to be considered at the time of final adjudication of the suit as the question of granting further relief or consequential relief would arise only if the court grants a declaration. If the plaintiff is unsuccessful in seeking the main relief of declaration, then, the question of granting any further relief would not arise at all. Therefore, omission on the part of the plaintiff in praying for further consequential relief, would become relevant only at the time of final adjudication of the suit. Hence, in view of the above, the plaint cannot be rejected at this stage by holding that the plaintiff has only sought declaratory reliefs and no further consequential reliefs.

32. The other reason cited for rejection of the plaint is that the suit is an attempt on the part of the plaintiff to deprive defendant no.1 of its legitimate dues. In other words, the plaintiff is seeking a declaration that the cheque for Rs. 56 lakhs issued in the name of defendant no.1 and handed over to defendant no.2 in turn to be handed over to defendant no.1 at the appropriate time was only as a security. According to the plaintiff it was not liable to pay the cheque amount to defendant no.1 since defendant no.1 had not fulfilled its obligations under the terms of the MoU. The declaratory reliefs sought are worded as under:

“(i) Let it be declared that the plaintiff had handed over the cheque to Sri Dilip Das, Advocate as a security;

Hence, it is contended by defendant no. 1 that the suit filed by the plaintiff is an attempt to frustrate the possibility of the defendant no.1 initiating action under the provisions of the N.I. Act for the dishonour of cheque. In this regard, reference could be made to Sections 118 (a) and 138 of N.I. Act, which reads as under:

“118. Presumptions as to negotiable instruments. -Until the contrary is proved, the following presumptions shall be made:-

(a) of consideration -that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;

XXX XXX XXX

138. Dishonour of cheque for insufficiency, etc., of funds in the account.-Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for [a term which may be extended to two years’], or with fine which may extend to twice the amount of the cheque, or with both:

Provided that nothing contained in this section shall apply unless-

(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;

(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice; in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and

(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

Explanation.-For the purposes of this section, “debt of other liability” means a legally enforceable debt or other liability.”

33. On a reading of the same, it is clear that there is a rebuttable presumption that every negotiable instrument including a cheque was made or drawn for a consideration and every such instrument when it has been accepted is for a consideration.

34. In the instant case, on a reading paragraph 13 of the plaint, it is evident that cheque issued had been dishonoured and defendant no.1 had issued notice under Section 138 of N.I. Act on 10^th June, 2009, to the plaintiff and its Managing Director replied to the same through their advocate on 23^rd June, 2009. Therefore, it is evident that the plaintiff by seeking the aforesaid reliefs is in substance frustrating the right of defendant no.1 to take steps under the provisions of N.I. Act for releasing the amount of cheque issued by the plaintiff to defendant no. 1 for a sum of Rs. 56 lakhs by filing a civil suit and/or by initiating a criminal prosecution. In other words, by seeking such a declaration that the cheque was issued as a security and that the same was illegally handed over by defendant no.2 to defendant no.1 in violation of the terms and conditions of the MoU, the plaintiff in substance is making an attempt to frustrate proceedings being initiated under Section 138 of the N.I. Act or for recovery of the amount by filing a civil suit.

35. On a holistic reading of the plaint and on consideration of the reliefs sought by the plaintiff, we find that the said reliefs are barred by law inasmuch as no plaintiff can be permitted to seek relief in a suit which would frustrate the defendants from initiating a prosecution against plaintiff or seeking any other remedy available in law. In fact, the attempt made by the plaintiff to seek such a declaratory relief is, in substance, to seek a relief of injunction against the defendants, particularly defendant no.1, but framed it in the nature of a declaratory relief. In other words, the plaintiff has sought an injunction against defendant no. 1 from seeking remedies in law on account of the cheque issued by the plaintiff for a sum of Rs. 56 lakhs being dishonoured.

36. We may refer to Sections 41 (b) and (d) of SR Act which are extracted as under: –

“41. Injunction when refused. – xxx

(b) to restrain any person from instituting or prosecuting any proceeding in a Court not subordinate to that from which the injunction is sought;

xxx xxx xxx

(d) to restrain any person from instituting or prosecuting any proceeding in a criminal matter;”

In the above context, following decisions are useful to be referred to:-

(a) In the case of Cotton Corporation of India Limited vs. United Industrial Bank Limited and Ors. -[(1983) 4 SCC 625], this Court highlighted the equitable principle underlying Section 41 (b) of the Specific Relief Act, 1963 as under: –

“8. It is, therefore, necessary to unravel the underlying intendment of the provision contained in Section 41(6). It must at once be conceded that Section 41 deals with perpetual injunction and it may as well be conceded that it has nothing to do with interim or temporary injunction which as provided by Section 37 are dealt with by the Code of Civil Procedure. To begin with, it can be said without fear of contradiction that anyone having a right that is a legally protected interest complains of its infringement and seeks relief through court must have an unhindered, uninterrupted access to law courts. The expression ‘court’ here is used in its widest amplitude comprehending every forum where relief can be obtained in accordance with law. Access to justice must not be hampered even at the hands of judiciary. Power to grant injunction vests in the court unless the legislature confers specifically such power on some other forum. Now access to court in search of justice according to law is the right of a person who complains of infringement of his legally protected interest and a fortiori therefore, no other court can by its action impede access to justice. This principle is deducible from the Constitution which seeks to set up a society governed by ride of law. As a corollary, it must yield to another principle that the superior court can injunct a person by restraining him from instituting or prosecuting a proceeding before a subordinate court. Save this specific carving out of the area where access to justice may be impeded by an injunction of the court, the legislature desired that the courts ordinarily should not impede access to justice through court. This appears to us to be the equitable principle underlying Section 41(b). Accordingly, it must receive such interpretation as would advance the intendment, and thwart the mischief it was enacted to suppress, and to keep the path of access to justice through court unobstructed.”

(b) In the case of Ratna Commercial Enterprises Ltd. vs. Vasutech Ltd. – [AIR 2008 Del 99], it was held: –

“29. The other issue concerns the maintainability of the suit itself in terms of the Section 41(d) of the Specific Relief Act, 1963 (‘SRA’) which reads as under:

“41. An injunction cannot be granted …. (d) to restrain any person from instituting or prosecuting any proceeding in a criminal matter.”

The law concerning the interpretation of Section 41(d) of the SRA is fairly well settled. It has been held In Re N.P. Essappa Chettiar AIR 1942 Mad. 756 and in Gauri Shanker v. District Board AIR 1947 All. 81 that a suit to restrain criminal proceedings being initiated is not maintainable. In Aristo Printers Pvt. Ltd. v. Purbanchal Trade Centre AIR 1992 Gau. 81 a Division Bench of the Gauhati High Court was dealing with a case where cheques issued by the plaintiff to the defendant had been dishonoured and notice had been issued to the defendant under Section 138 NI Act. The plaintiff then filed a suit to restrain the defendant from instituting proceedings under the NI Act. The Court referred to a judgment of the Hon’ble Supreme Court in State of Orissa v. Madan Gopal Rungta AIR 1952 SC 12 and Cotton Corporation of India Ltd. v. United Industrial Bank Ltd. AIR 1983 SC 1272 and held that “an order of injunction of the nature issued in this case cannot be granted and the hands of the criminal court cannot be fettered by the civil court.”

30. The decision of this Court in Atul Kumar Singh v. Jalveen Rosha AIR 2000 Del 38 was in a case where the plaintiff had issued four cheques issued in favour for the defendant for a value of Rs. 7 lakhs. The cheques when presented were dishonoured. After service of notice under Section 138 NI Act, the plaintiff filed a suit for a declaration that “the defendant is not entitled to any benefit on account of holding the cheques” and to injunct the defendant “from using or claiming any benefit by virtue of possessing the instruments.” This Court, while allowing the defendant’s application for rejecting the plaint, held that (AIR, p.40):

“The reliefs claimed in this suit are in substance for an injunction restraining the defendant from prosecuting the criminal case instituted against the plaintiff. Section 41(b) of the SRA denies to the Court the jurisdiction to grant an injunction restraining any person from prosecuting any proceedings in a Court. Consequently, the injunction sought by the plaintiff cannot be granted since it would have the effect of preventing the defendant from prosecuting the criminal case against the plaintiff.”

Further, the nature of the declaratory reliefs sought already arises out of the MoU dated 17^th January, 2009, between the plaintiff and defendant no.1 in respect of which the plaintiff could seek appropriate remedies, if there is a breach of the said MoU by defendant no.1, but the plaintiff cannot seek declaratory reliefs to the effect that the plaintiff was not liable to carry out his obligation under the terms of the MoU. If the plaintiff has failed to do so then the defendant no.1 would have a cause of action against the plaintiff, but there cannot be a frustration of the right to seek a remedy in law by means of seeking declaration under a contract or MoU as in the instant case.

37. Moreover, the right of defendant no.1 to prosecute the plaintiff owing to the dishonour of the cheque issued by the plaintiff for a sum of Rs. 56 lakhs cannot be frustrated by seeking a declaration that the said cheque was handed over as a security. Such a declaration cannot be ex facie granted as it would be contrary to the provisions of the N.I. Act and particularly Section 118(a) thereof. If the plaintiff is aggrieved on account of breach of the terms and conditions of the MoU committed by defendant no.1 then it could seek appropriate reliefs in accordance with law. Whether the plaintiff was not liable to issue the cheque for Rs. 56 lakhs to defendant no.1 under the terms of the MoU is a matter which has to be considered in an appropriate proceeding to be initiated by defendants on account of dishonour of the said cheque under Section 138 of the N.I. Act. The plaintiff can always prove that it had no legal liability or debt to be discharged vis-a-vis defendant no.1 under the terms of the MoU, if any proceeding is to be initiated by defendant no.1 on account of the dishonour of the said cheque. Further, if defendant no. 1 is to seek any relief for the non-supply of 3876 MT of iron ore fines by the plaintiff under the very same MoU then the plaintiff is entitled to take appropriate defences as are available in law. If the plaintiff has a grievance against the defendants and particularly defendant no.1, arising from the MoU, such prayers have not been sought by the plaintiff. Such reliefs could have been sought by the plaintiff inasmuch as there is no prayer seeking recovery of Rs. 21.50 lakhs from defendant no.1 which according to the plaintiff is due to it.

38. In the circumstances, we hold that while the plaintiff has certain grievances arising from the MoU, against the defendants which may give rise to seek appropriate remedies in law, the aforesaid three declaratory reliefs sought in the plaint are barred by law. Hence, the plaint is liable to be rejected in exercise of jurisdiction under Order VII Rule 11 CPC. In our view, the revisional court was justified in rejecting the plaint but the High Court has erroneously set aside the order of the revisional court without appreciating the facts and circumstances of the case and has simply remanded the matter to the revisional court to reconsider the revision afresh on the premise that the revisional court did not have the jurisdiction to reject the plaint under Section 115 of the CPC.

39. In the result, the impugned Order of the High Court is set aside and the Order of the revisional court passed in C.R.P. No.5 of 2012 dated 23.02.2013 is restored. The plaint in C.S. No. 1065 of 2009 is rejected. This appeal is accordingly allowed.

40. However, it is clarified that the rejection of the plaint would not come in the way of the plaintiff filing a suit against defendant no.1 for seeking appropriate reliefs in accordance with law, if so advised.

Parties to bear their respective costs.

Posted on 28th March 2022 by rajatbindal5gmailcom — Leave a comment

National Green Tribunal Act, 2010 – Section 22 – Environment (Protection) Act, 1986 – Section 3 – An establishment contributing to the economy of the country and providing livelihood ought not to be closed down only on the ground of the technical irregularity of not obtaining prior Environmental Clearance irrespective of whether or not the unit actually causes pollution.

SUPREME COURT OF INDIA

DIVISION BENCH

M/S PAHWA PLASTICS PRIVATE LIMITED AND ANOTHER — Appellant

Vs.

DASTAK NGO AND OTHERS — Respondent

( Before : Indira Banerjee and J.K. Maheshwari, JJ. )

Civil Appeal No. 4795 of 2021

Decided on : 25-03-2022

A. National Green Tribunal Act, 2010 – Section 22 – Environment (Protection) Act, 1986 – Section 3 – An establishment contributing to the economy of the country and providing livelihood ought not to be closed down only on the ground of the technical irregularity of not obtaining prior Environmental Clearance irrespective of whether or not the unit actually causes pollution.

B. Environment (Protection) Act, 1986 – Ex post facto EC should not ordinarily be granted, and certainly not for the asking. At the same time ex post facto clearances and/or approvals cannot be declined with pedantic rigidity, regardless of the consequences of stopping the operations.

C. Environment (Protection) Act, 1986 – Section 3 – Central Government is well within the scope of its powers under Section 3 of the 1986 Act to issue directions to control and/or prevent pollution including directions for prior Environmental Clearance before a project is commenced. Such prior Environmental Clearance is necessarily granted upon examining the impact of the project on the environment. ExPost facto Environmental Clearance should not ordinarily be granted, and certainly not for the asking. At the same time ex post facto clearances and/or approvals and/or removal of technical irregularities in terms of Notifications under the 1986 Act cannot be declined with pedantic rigidity, oblivious of the consequences of stopping the operation of a running steel plant.

D. Environment (Protection) Act, 1986 – Section 3 – The 1986 Act does not prohibit ex post facto Environmental Clearance. Some relaxations and even grant of ex post facto EC in accordance with law, in strict compliance with Rules, Regulations Notifications and/or applicable orders, in appropriate cases, where the projects are in compliance with, or can be made to comply with environment norms, is in over view not impermissible. The Court cannot be oblivious to the economy or the need to protect the livelihood of hundreds of employees and others employed in the project and others dependent on the project, if such projects comply with environmental norms.

E. Environment (Protection) Act, 1986 – Section 3 – Ex post facto environmental clearance should not be granted routinely, but in exceptional circumstances taking into account all relevant environmental factors. Where the adverse consequences of denial of ex post facto approval outweigh the consequences of regularization of operations by grant of ex post facto approval, and the establishment concerned otherwise conforms to the requisite pollution norms, ex post facto approval should be given in accordance with law, in strict conformity with the applicable Rules, Regulations and/or Notifications. The deviant industry may be penalised by an imposition of heavy penalty on the principle of ‘polluter pays’ and the cost of restoration of environment may be recovered from it.

Counsel for Appearing Parties

Mr. Nidhesh Gupta, Sr. Advocate, Mr. Tarun Gupta, Advocate, for the Appellant; Dr. Surender Singh Hooda, Advocate, Mr. Aayushman Aeron, Advocate, Mr. Aditya Hooda, Advocate, Mr. Rahul Besoya, Advocate, Mr. Anil Grover, Sr. AAG, Ms. Noopur Singhal, Advocate, Mr. Rahul Khurana, Advocate, Mr. Satish Kumar, Advocate, Mr. Sanjay Kumar Visen, Advocate, Ms. Babita Mishra, Advocate, Ms. Aishwarya Bhati, ASG, Ms. Priyanka Das, Advocate, Ms. Archana Pathak Dave, Advocate, Ms. Preeti, Advocate, Mr. Shubhranshu Padhi, Advocate, Mr. Gurmeet Singh Makker, Advocate, for the Respondent.

Cases Referred

Alembic Pharmaceuticals Ltd. v. Rohit Prajapati & Others, 2020 SCC Online SC 347
Electrosteel Steels Limited v. Union of India, 2021 SCC online SC 1247
Lafarge Umiam Mining Private Limited v. Union of India, (2011) 7 SCC 338
Puducherry Environment Protection Association v. Union of India, 2017 SCC OnLine Mad 7056
S.P.Muthuraman vs. Union of India & Another, 2015 SCC Online NGT 169
Shree Sidhbali Steels Ltd. & Others v. State of Uttar Pradesh & Others, (2011) 3 SCC 193

JUDGMENT

Indira Banerjee, J. – This appeal under Section 22 of the National Green Tribunal Act, 2010, is against an order dated 3^rd June 2021 passed by the Principal Bench of the National Green Tribunal (NGT) in O.A No. 287/2020 at New Delhi, inter alia, holding that establishments such as the manufacturing units of the Appellants, which did not have prior Environmental Clearance (EC) could not be allowed to operate.

2. The question of law involved in this appeal is, whether an establishment employing about 8000 workers, which has been set up pursuant to Consent to Establish (CTE) and Consent to Operate (CTO) from the concerned statutory authority and has applied for ex post facto EC can be closed down pending issuance of EC, even though it may not cause pollution and/or may be found to comply with the required pollution norms.

3. With increasing industrialization and the establishment of factories which emitted smoke and other pollutants, there was worldwide concern for protection of environment. In June 1972, the United Nations Conference on the Human Environment was held in Stockholm, where decisions were taken to take appropriate steps for preservation of the natural resources of the earth, which, among other things, included preservation of the quality of air and water by controlling pollution.

4. In 1974, Parliament enacted the Water (Prevention and Control of Pollution) Act, 1974, with a view to prevent and control water pollution and to maintain and restore wholesomeness of water.

5. In furtherance of the decisions taken at Stockholm, Parliament enacted the Air (Prevention and Control of Pollution) Act, 1981, hereinafter referred to as “the Air Pollution Act”, to provide for prevention, control and abatement of air pollution.

6. The Air Pollution Act provides for the constitution of a Central Pollution Control Board (CPCB) and State Pollution Control Boards (SPCB) to deal with the problem of air pollution. Section 16 of the Air Pollution Act enables the Central Pollution Control Board to take steps to improve the quality of air and to prevent, control or abate air pollution in the country. Section 17 of the Air Pollution Act enables the State Pollution Control Boards to plan comprehensive programmes for the prevention, control or abatement of air pollution, inter alia, by laying down standards for emission of air pollutants.

7. Section 18 of the Air Pollution Act enables the Central Government to give directions by which the CPCB is to be bound. Similarly, every SPCB is to be bound by directions in writing as might be given by the CPCB or the State Government.

8. Where a notification is issued under the Air Pollution Act, placing an area within the control area of air pollution, permission is necessary to set up and operate any factory or plant thereat. No person operating any factory or plant in any air pollution control area is to discharge or cause or permit to be discharged the emission of any air pollutants, in excess of the standards laid down by the SPCB under Clause (g) of sub-Section (1) of Section 17.

9. The Environment (Protection) Act, 1986, hereinafter referred to as “the EP Act” was also enacted pursuant to the decisions taken at the United Nations Conference on the Human Environment, held in Stockholm in June, 1972. As per the Statement of Objects and Reasons for enactment of the EP Act, the said Act has been prompted by concern over the environment, that has grown all over the world since the 60s.

10. Sub-section (1) of Section 3 of the EP Act empowers the Central Government to take all such measures as it might deem necessary or expedient for the purpose of protecting and improving the quality of the environment and preventing, controlling and reducing environmental pollution.

11. Sub-section (2) of Section 3 of the EP Act enables the Central Government to take, inter alia, the following measures:

“(i) co-ordination of actions by the State Governments, officers and other authorities

(a) under this Act, or the rules made thereunder; or

(b) under any other law for the time being in force which is relatable to the objects of this Act;

(ii) planning and execution of a nation-wide programme for the prevention, control and abatement of environmental pollution;

(iii) laying down standards for the quality of environment in its various aspects;

(iv) laying down standards for emission or discharge of environmental pollutants from various sources whatsoever:

Provided that different standards for emission or discharge may be laid down under this clause from different sources having regard to the quality or composition of the emission or discharge of environmental pollutants from such sources;

(v) restriction of areas in which any industries, operations or processes or class of industries, operations or processes shall not be carried out or shall be carried out subject to certain safeguards;

(vi) laying down procedures and safeguards for the prevention of accidents which may cause environmental pollution and remedial measures for such accidents;

(vii) laying down procedures and safeguards for the handling of hazardous substances;

(viii) examination of such manufacturing processes, materials and substances as are likely to cause environmental pollution;

(ix) carrying out and sponsoring investigations and research relating to problems of environmental pollution;

(x) inspection of any premises, plant, equipment, machinery, manufacturing or other processes, materials or substances and giving, by order, of such directions to such authorities, officers or persons as it may consider necessary to take steps for the prevention, control and abatement of environmental pollution;

(xi) establishment or recognition of environmental laboratories and institutes to carry out the functions entrusted to such environmental laboratories and institutes under this Act;

(xii) collection and dissemination of information in respect of matters relating to environmental pollution;

(xiii) preparation of manuals, codes or guides relating to the prevention, control and abatement of environmental pollution;

(xiv) such other matters as the Central Government deems necessary or expedient for the purpose of securing the effective implementation of the provisions of this Act.”

12. Sub-section (3) of Section 3 of the EP Act provides as follows:

“3. Power of Central Government to take measures to protect and improve environment.

(3) The Central Government may, if it considers it necessary or expedient so to do for the purposes of this Act, by order, published in the Official Gazette, constitute an authority or authorities by such name or names as may be specified in the order for the purpose of exercising and performing such of the powers and functions (including the power to issue directions under Section 5) of the Central Government under this Act and for taking measures with respect to such of the matters referred to in sub-section (2) as may be mentioned in the order and subject to the supervision and control of the Central Government and the provisions of such order, such authority or authorities may exercise the powers or perform the functions or take the measures so mentioned in the order as if such authority or authorities had been empowered by this Act to exercise those powers or perform those functions or take such measures.”

13. Subject to the provisions of the EP Act, the Central Government has power under sub-Section (1) of Section 3, to take all such measures, as it deems necessary or expedient, for the purpose of protecting and improving the quality of environment and preventing, controlling or reducing environmental pollution.

14. Section 5 of the EP Act provides that notwithstanding anything contained in any other law, but subject to the provisions of the EP Act, the Central Government may, in exercise of its powers and performance of its functions under the EP Act, issue directions in writing to any person, officer or any authority and such person, officer or authority shall be bound to comply with such directions.

15. In exercise of powers conferred by Sections 6 and 25 of the EP Act, the Central Government has made the Environment (Protection) Rules, 1986, hereinafter referred to as “the EP Rules”.

16. The Central Government issued an Environmental Impact Assessment Notification dated 27^th January 1994 in exercise of powers conferred by sub-section (1) and clause (v) of sub-section (2) of Section 3 of the EP Act read with clause (d) of sub-rule (3) of Rule 5 of the EP Rules, directing that on and from the date of publication of the said notification in the Official Gazette, expansion or modernization of any activity or a new project listed in Schedule I to the said notification shall not be undertaken in any part of India, unless it has been accorded EC by the Central Government in accordance with the procedures specified in the said notification.

17. In exercise of powers conferred by sub-section (1) and clause (v) of sub-section (2) of Section 3 of the EP Act read with clause (d) of sub-rule (3) of Rule 5 of the EP Rules and in supersession of notification number S.O. 60 (E) dated 27^th January 1994, except in respect of things done or omitted to be done before such supersession, the Central Government issued a notification dated 14^th September 2006, being Notification S.O. 1533 (E) requiring prior environmental clearance from the Central Government or as the case may be, by the State-Level Environment Assessment Authority, duly constituted by the Central Government under sub-section (3) of Section 3 of the EP Act.

18. In terms of the said notification dated 14^th September 2006, the process of environmental clearance for new projects was to comprise of a maximum of four stages, all of which might not apply to particular cases. The stages were (1) Screening, (2) Scoping, (3) Public Consultation and (4) Appraisal.

19. In the meanwhile, by a notification being S.O. 327 (E) dated 10^thApril 2001, published in the Gazette of India on 12^th April 2001, the Central Government has delegated the powers vested in it under the EP Act, to the Chairpersons of the respective State Pollution Control Boards/Committees to issue directions to any industry or any local or other authority to prevent violation of the Rules.

20. The Appellants carry on business, inter alia, of manufacture and sale of basic organic chemicals, namely, Formaldehyde. The Appellant No.1, M/s Pahwa Plastics Private Limited has two manufacturing units, one at village Kharawar in Rohtak, hereinafter referred to as the “Rohtak Unit” and the other at village Jathlana, Jagadhri in Yamuna Nagar in Haryana, hereinafter referred to as the “Yamuna Nagar Unit”.

The Appellant No.2 has a manufacturing unit at village Ghespur in Yamuna Nagar, Haryana which is hereinafter referred to as the “Yamuna Nagar Unit”. The manufacturing units established, run and operated by the respective Appellants fall in the category of Micro, Small and Medium Enterprise (MSME) as defined under the Micro, Small and Medium Enterprises Development Act, 2006, hereinafter referred to as “the MSME Act”.

21. On or about 31^st March 2014, the Appellant No.1, M/s Pahwa Plastics Ltd. applied for Consent to Establish (CTE) its Yamuna Nagar unit for manufacture of Formaldehyde.

22. By a communication No. HSPCB/Consent/:2846616 YAMCTE 3087415 dated 2^nd June 2016, the Haryana State Pollution Control Board (HSPCB) granted Consent to Establish (CTE) to the Appellant No.1 M/s Pahwa Plastics Private Limited in respect of its Yamuna Nagar Unit. The CTE was to remain valid for 60 months from the date of its issue, to be extended for another year at the discretion of the Board or till the time the unit started its trial production, whichever was earlier.

23. Some of the terms and conditions on which CTE was granted are set out hereinbelow:-

“3. The officer/official of the Board shall have the right to access and inspection of the industry in connection with the various processes and the treatment facilities being provided simultaneously with the construction of building/machinery. The effluent should conform the effluent standards as applicable.

4. That necessary arrangement shall be made by the industry for the control of Air Pollution before commissioning the plant. The emitted pollutants will meet the emission and other standards as laid/will be prescribed by the Board from time to time.

5. The applicant will obtain consent under section 25/26 of the Water (Prevention & Control of Pollution) Act, 1974 and under section 21/22 of the Air (Prevention & Control of Pollution) Act, 1981 as amended to-date-even before starting trial production.

6. The above Consent to Establish is further subject to the conditions that the unit complies with all the laws/rules/decisions and competent directions of the Board/Government and its functionaries in all respect before commissioning of the operation and during its actual working strictly.

8. The Electricity Department will give only temporary connection and permanent connection to the unit will be given after verifying the consent granted by the Board, both under Water Act and Air Act.

***

12. That there is no discharge directly or indirectly from the unit or the process into any interstate river or Yamuna River or River Ghaggar.

13. That the industry or the unit concerned is not sited within any prohibited distances according to the Environmental Laws and Rules, Notification, Orders and Policies of Central Pollution Control Board and Haryana State Pollution Control Board.

***

17. In case of change of name from previous Consent to Establish granted, fresh Consent to Establish fee shall be levied.

18. Industry should adopt water conservation measures to ensure minimum consumption of water in their Process. Ground water based proposals of new industries should get clearance from Central Ground Water Authority for scientific development of previous resources.

19. That the unit will take all other clearances from concerned agencies, whenever required.

20. That the unit will not change its process without the prior permission of the Board.

21. That the Consent to Establish so granted will be invalid, if the unit falls in Aravali Area or non conforming area.

22. That the unit will comply with the Hazardous Waste Management Rules and will also make the non-leachate pit for storage of Hazardous waste and will undertake not to dispose off the same except for pit in their own premises or with the authorized disposal authority.

23. That the unit will submit an undertaking that it will comply with all the specific and general conditions as imposed in the above Consent to Establish within 30 days failing which Consent to Establish will be revoked.”

24. By another communication No. HSPCB/Consent/: 2846618 YAMCTO 3098246 dated 26^th March 2018, HSPCB granted consent to the Appellant No.1 to operate its Yamuna Nagar Unit from 8^th February 2018 to 31^st March 2022.

25. By an order No.HSPCB/YMN/2242, dated 31^st March 2010, the Appellant No.2, M/s Apcolite Polymer Private Limited was granted CTE to establish its Yamuna Nagar Unit for manufacture of Formaldehyde with the manufacturing capacity of 80 tonnes per day.

26. By another communication Nos. HSPCB/Consent/: HSPCB/YMN/DLC/2011/4027 & HSPCB/YMN/DLC/2011/4029 dated 16^thJanuary 2012, HSPCB granted the Appellant No.2, M/s Apcolite Polymers Private Limited, Consent to Operate (CTO) its Yamuna Nagar Unit. The CTO has been extended from 1^st April 2016 till 31^st March 2026, by a letter dated 13^th March 2016. The CTO is valid till March 2026.

27. By a communication No. HSPCB/Consent/: 2846616YAMCT OHWM2630357 dated 13^th March 2016, HSPCB granted consent for emission of AIR to Appellant No.2, M/s Apcolite Polymers Private Limited in respect of its Yamuna Nagar Unit on, inter alia, the terms and conditions specified in the said letter, some of which are extracted hereinbelow:-

“10. The air pollution control equipment of such specification which shall keep the emissions within the emission standard as approved by the State Board from time to time shall be installed and operated in the premises where the industry is carrying on/proposed to carry on its business.

11. The existing air pollution control equipment if required shall be alerted or replaced in accordance with the direction on the Board.

12. All solid wastes arising in the factory premises shall be properly graded and disposed of by-

(i) In case of Land fill material, care should be taken to ensure that the material does not give rise to leachate which may percolate in ground water of carried away with storm run off.

(ii) Composting in case of bio degradable materials.

(iii) If the method of incineration is used for the disposal of solid waste the consent application should be processed separately and it should be taken up which consent is granted.

13. The industry shall submit an undertaking to the effect that the above conditions shall be complied with by them.

14. The applicant shall submit its undertaking to the effect that the above conditions shall be complied with by them.

15. The applicant shall make an application for grant of fresh consent at least 90 days before the date of expiry of this consent.

***

18. There should not be any fugitive emission from the premises.

19. The liquid effluent arising out of the operation of the air pollution control equipment shall also be treated in a manner and to the standards stipulated in the consent granted under Water (Prevention & Control of Pollution) Act, 1974 by this Board.

***

21. If the industry fails to adhere to any of the condition of this consent order the consent so granted shall automatically lapse.

***

33. The industry shall submit Environment Audit report once in a year.

38. In case of by passing the emissions, the consent shall be deemed revoked.”

28. It is the case of the Appellants that at the time when CTE was granted to the Appellants, it was thought that EC was not required for units which manufactured Formaldehyde. Even HSPCB itself was not sure of whether EC was required for such units.

29. Mr. Gupta argued that the Appellants were bona fide under the impression that the Appellants were not required to obtain prior EC for setting up this establishment to manufacture Formaldehyde. On the basis of CTE granted by HSPCB, the Appellants set up their units taking huge loans from banks for which repayments have to be paid in installments.

30. In exercise of power under Section 3(1) and Section 3(2)(v) of the EP Act read with Rule 5(3)(d) of the EP Rules, the Central Government issued a notification being S.O. 804(E) dated 14^th March 2017 which provides for grant of ex post facto EC for project proponents who had commenced, continued or completed a project without obtaining EC under the EP Act/ EP Rules or the Environmental Impact Notification issued thereunder. Paragraphs 3, 4 and 5 of the said notification, read as hereunder:

“(3) In cases of violation, action will be taken against the project proponent by the respective State or State Pollution Control Board under the provisions of section 19 of the Environment (Protection) Act, 1986 and further, no consent to operate or occupancy certificate will be issued till the project is granted the environmental clearance.

(4) The cases of violation will be appraised by respective sector Expert Appraisal Committees constituted under sub-section (3) of Section 3 of the Environment (Protection) Act, 1986 with a view to assess that the project has been constructed at a site which under prevailing laws is permissible and expansion has been done which can be run sustainably under compliance of environmental norms with adequate environmental safeguards; and in case, where the finding of the Expert Appraisal Committee is negative, closure of the project will be recommended along with other actions under the law.

(5) In case, where the findings of the Expert Appraisal Committee on point at sub-para(4) above are affirmative, the projects under this category will be prescribed the appropriate Terms of Reference for undertaking Environment Impact Assessment and preparation of Environment Management Plan. Further, the Expert Appraisal Committee will prescribe a specific Terms of Reference for the project on assessment of ecological damage, remediation plan and natural and community resource augmentation plan and it shall be prepared as an independent chapter in the environment impact assessment report by the accredited consultants. The collection and analysis of data for assessment of ecological damage, preparation of remediation plan and natural and community resource augmentation plan shall be done by an environmental laboratory duly notified under Environment (Protection) Act, 1986, or a environmental laboratory accredited by National Accreditation Board for Testing and Calibration Laboratories, or a laboratory of a Council of Scientific and Industrial Research institution working in the field of environment.”

31. The Notification of 2017 is a valid statutory notification issued by the Central Government in exercise of power under Sections 3(1) and 3(2)(v) of the EP Act read with Rule 5(3)(d) of the EP Rules in the same manner as the EIA Notification dated 27^th January 1994 and the Notification dated 14^th September 2006.

32. Section 21 of the General Clauses Act, 1897 provides that where any Central Act or Regulations confer a power to issue notifications, orders, rules or bye-laws, that power includes the power, exercisable in like manner, and subject to like sanction and conditions, if any, to add to, amend, vary or rescind any notification, order, rule or bye-law so issued. The authority, which had the power to issue Notifications dated 27^th January 1994 and 14^th September 2006 undoubtedly had, and still has the power to rescind or modify or amend those notifications in like manner. As held by this Court in Shree Sidhbali Steels Ltd. & Others v. State of Uttar Pradesh & Others, (2011) 3 SCC 193, power under Section 21 to amend, vary or rescind notifications, orders, rules or bye-laws can be exercised from time to time having regard to the exigency.

33. Puducherry Environment Protection Association filed a Writ Petition being W.P. No. 11189 of 2017 in the High Court of Madras assailing the said notification dated 14^th March 2017. By a judgment and order dated 13^th October 2017, a Division Bench of the High Court refused to interfere with the said notification, holding that the impugned notification did not compromise with the need to preserve environmental purity.

34. The Ministry of Environment, Forest and Climate Change (MoEF &CC) issued a draft notification dated 23^rd March 2020 which was duly published in the Gazette of India Extraordinary Part II. The Notification was proposed to be issued in exercise of powers conferred by subsection (1) and clause (v) of sub-section (2) of Section 3 of the EP Act for dealing with cases of violation of the notification with regard to EC.

It was proposed that cases of violation would be appraised by the Appraisal Committee with a view to assess whether the project had been constructed or operated at a site which was permissible under prevailing laws and could be run sustainably on compliance of environmental norms with adequate environmental safeguards. Closure was to be recommended if the findings of the Appraisal Committee were in the negative. If the Appraisal Committee found that such unit had been running sustainably upon compliance of environmental norms with adequate environment safeguards, the unit would be prescribed appropriate Terms of Reference (TOR) after which the procedure for grant of EC would follow.

35. On 10^th November 2020, the Department of Environment and Climate Change of the Government of Haryana issued an order which is extracted hereinbelow for convenience:

” Whereas the process of manufacturing of Formaldehyde is covered under the provisions of 5(f) of Schedule of Environment Impact Assessment Notification (EIA), 2006 of Government of India, and requires the prior Environmental Clearance (EC) from the competent authority State Environment Impact Assessment Authority (SEIAA)/Ministry of Environment, Forest and Climate Change, Government of India, before establishment and operation of such units, besides other mandatory clearance, as applicable;

Whereas, it has come to the notice of Government that around 15 such units have been permitted to establish/operate in the State of Haryana, without obtaining the necessary Prior Environmental Clearances, but with the Consent of the Haryana State Pollution Control Bureau (HSPCB), which misinterpreted the category of such units and on realising the requirement of EC in these cases, has revoked its consents issued earlier to these units recently;

Whereas, some of these units approached the Government explaining their hardship due to such sudden revocation of their consents and have sought time for obtaining the necessary EC from the competent authority as the process is likely to take a minimum of 6 months to one year period, and to allow them to operate with all pollution control measures, following the pollution control norms applicable, and,

Whereas, the Government has carefully considered their request and the competent authority has decided that these units shall be allowed to continue their operations for a period of six months, without prejudice to any legal action taken against the violations committed by them, by the competent authorities, with the conditions that they will immediately apply for Environmental Clearance from the competent authority and provide the proof of such application within 60 days from the issuance of this communication to Environment and Climate Change Department and to Haryana State Pollution Control Board.

Therefore, it is ordered accordingly “

36. Referring to the Counter Affidavit filed by HSPCB before the NGT, Mr. Gupta pointed out that, since HSPCB itself was under the misconception that prior EC was not necessary for units such as the Yamunanagar units of the Appellants Nos. 1 and 2 respectively. HSPCB took a policy decision to allow the units which did not have prior EC to operate for six months, on condition that they would apply for EC within sixty days.

37. The Appellants duly applied for EC in respect of their manufacturing units. After scrutinizing their applications and after finding the units suitable for grant of EC in terms of the prevailing guidelines, the Expert Appraisal Committee constituted by the MoEF&CC conducted a public hearing to finalize the cases of the Appellants for issuance of Terms of Reference (TOR).

38. By an Office Memorandum, being F.No. 22-21/2020-1A III, dated 7^th July 2021, the MoEF&CC issued Standard Operating Procedure (SOP) for identification and handling of violation cases under EIA Notification 2006.

39. The said Office Memorandum, inter alia, reads:

“The Ministry had issued a notification number S.O. 804(E), dated the 14^th March, 2017 detailing the process for grant of Terms of Reference and Environmental Clearance in respect of projects or activities which have started the work on site and/or expanded the production beyond the limit of Prior EC or changed the product mix without obtaining Prior EC under the EIA Notification, 2006.

2. This Notification was applicable for six months from the date of publication i. e. 14.03.2017 to 13.09.2017 and further based on court direction from 14.03.2018 to 13.04.2018.

3. Hon’ble NGT in Original Application No. 287 of 2020 in the matter of Dastak N.G.O. Vs Synochem Organics Pvt. Ltd. & Ors. and in applications pertaining to same subject matter in Original Application No. 298 of 2020 in Vineet Nagar vs. Central Ground Water Authority & Ors., vide order dated 03.06.2021 held that “(…) for past violations, the concerned authorities are free to take appropriate action in accordance with polluter pays principle, following due process”.

4. Further, the Hon’ble National Green Tribunal in O.A. No. 34/2020 WZ in the matter of Tanaji B. Gambhire vs. Chief Secretary, Government of Maharashtra and Ors., vide order dated 24.05.2021 has directed that”…. a proper SoP be laid down for grant of EC in such cases so as to address the gaps in binding law and practice being currently followed. The MoEF may also consider circulating such SoP to all SEIAAs in the country”.

5. Therefore, in compliance to the directions of the Hon’ble NGT a Standard Operating Procedure (SoP) for dealing with violation cases is required to be drawn. The Ministry is also seized of different categories of ‘violation’ cases which have been pending for want of an approved structural/procedural framework based on ‘Polluter Pays Principle’ and ‘Principle of Proportionality’. It is undoubtedly important that action under statutory provisions is taken against the defaulters/violators and a decision on the closure of the project or activity or otherwise is taken expeditiously.

6. In the light of the above directions of the Hon’ble Tribunal and the issues involved, the matter has accordingly been examined in detail in the Ministry. A detailed SoP has accordingly been framed and is outlined herein. The SoP is also guided by the observations/decisions of the Hon’ble Courts wherein principles of proportionality and polluters pay have been outlined.”

40. The SOP formulated by the said Office Memorandum dated 7^thJuly 2021 refers to and gives effect to various judicial pronouncements including the judgment of this Court in Alembic Pharmaceuticals Ltd. v. Rohit Prajapati & Others, 2020 SCC Online SC 347.

41. In terms of the SOP, the proposal for grant of EC in cases of violation are to be considered on merits, with prospective effect, applying principles of proportionality and the principle that the polluter pays and is liable for costs of remedial measures.

42. By an order dated 9^th July 2021, the MoEF&CC confirmed the minutes of an earlier meeting of the Expert Appraisal Committee and recommended issuance of terms of reference to the Appellant No.1, M/s Pahwa Plastics Private Limited for expansion of its Formaldehyde Manufacturing unit from 60 TPD to 150 TPD.

43. In the meanwhile, on or about 26^th November 2020, the Respondent No.1, a Non-Governmental Organisation (NGO) hereinafter referred to as “Dastak” filed an application being O.A. No./287/2020 before the NGT praying that the order dated 10^th November 2020 passed by the State of Haryana be quashed and units which were operating without EC be closed. The NGT disposed of the said application of Dastak by the impugned order dated 3^rd June 2021.

44. A Public Interest Litigation being W.P. (MD) No. 11757 of 2021 {Fatima v. Union of India) was filed before the Madurai Bench of the Madras High Court challenging the said Memorandum dated 7^th July 2021. By an interim order dated 15^th July 2021 a Division Bench of the Madras High Court admitted the Writ Petition and stayed the said memorandum.

45. The Madurai Bench of the Madras High Court observed and held:-

“This writ petition has been filed as a public interest litigation challenging the validity of the office memorandum dated 07.07.2021, issued by the respondent.

2. We have heard Mr.A.Yogeshwaran, learned counsel appearing for the writ petitioner and Mr.L.Victoria Gowri, learned Assistant Solicitor General of India, accepts notice for the respondent.

3. The impugned office memorandum is challenged as being wholly without jurisdiction, contrary to the Environment Impact Assessment Notification, 2006, ultra vires the powers of the respondent under the Environment (Protection) Act, 1986 and violative of the various principles enunciated by the Hon’ble Supreme Court, while interpreting Article 21 and Article 48-A of the Constitution of India.

4. Further, it is submitted that the impugned notification is in gross violation of the undertaking given before the Hon’ble Full Bench of this Court in W.P.No. 11189 of 2017, wherein, the Court took note of the submissions made on behalf of the Government of India, that the notification impugned therein is only a one-time measure. Further, it is submitted that the respondent failed to see that concept of ex-post facto approval is alien to environment jurisprudence and it is anathema to the Environment Impact Assessment Notification, 2006.

5. Further, it is submitted that the impugned notification is in gross violation of the judgment of the Hon’ble Supreme Court in the case of Alembic Pharmaceuticals Ltd. vs Rohit Prajapati, 2020 SCC Online SC 347 and the orders passed by the National Green Tribunal, Principal Bench, New Delhi, in the case of S.P.Muthuraman vs. Union of India & Another, 2015 SCC Online NGT 169.

6. Identical grounds were considered by us in a challenge to an office memorandum dated 19.02.2021, which provided a procedure for granting post facto clearance under Coastal Regulation Zone (CRZ) Notification 2011, on the ground that despite no such provisions in the notification and being contrary to the earlier judgments and undertaking. The said writ petition in W.P(MD).No. 8866 of 2021 was admitted and by order dated 30.04.2021, the said office memorandum dated 19.02.2021 has been stayed.

7. The core issue in this writ petition is whether the Government of India could have issued the office memorandum and brought about the Standard Operating Procedure for dealing with violators, who failed to comply with the mandatory condition of obtaining prior environment clearance under the Environment Impact Assessment Notification 2006, read with the provisions of Environment (Protection) Act, 1986. This issue was considered by the Hon’ble Supreme Court in Alembic Pharmaceuticals Ltd (cited supra), and it was held that such office memorandum in the nature of circular is without jurisdiction. The operative portion of the judgment reads as follows:

“…What is sought to be achieved by the administrative circular dated 14 May 2002 is contrary to the statutory notification dated 27 January 1994. The circular dated 14 May 2002 does not stipulate how the detrimental effects on the environment would be taken care of if the project proponent is granted an ex post facto EC. The EI A notification of 1994 mandates a prior environmental clearance. The circular substantially amends or alters the application of the EI A notification of 1994. The mandate of not commencing a new project or expanding or modernising an existing one unless an environmental clearance has been obtained stands diluted and is rendered ineffective by the issuance of the administrative circular dated 14 May 2002. This discussion leads us to the conclusion that the administrative circular is not a measure protected by Section 3. Hence there was no jurisdictional bar on the NGT to enquire into its legitimacy or vires. Moreover, the administrative circular is contrary to the EI A Notification 1994 which has a statutory character. The circular is unsustainable in law.”

8. Despite the above decision, once again the Government of India, Ministry of Environment, Forest and Climate Change have chosen to adopt the route of issuing the office memorandum and virtually setting at naught the provisions of the Environment Impact Assessment Notification and the Environment (Protection) Act.

9. Before the Hon’ble First Bench, a public interest litigation was filed by the Puducherry Environment Protection Association, challenging the notification dated 14.03.2017, on identical grounds and the Hon’ble First Bench by judgment dated 13.10.2017, recorded the submissions of the learned Assistant Solicitor General of India that the said notification was a one-time measure and accordingly, disposed of the writ petition.

10. Once again, the Ministry of Environment, Forest and Climate Change have issued the impugned office memorandum. Thus, from what we have noted above, we are of the clear view that the petitioner has made out a prima facie case for entertaining the writ petition. Accordingly, the writ petition is admitted and there shall be an order of interim stay.”

46. It is true that in the case of Puducherry Environment Protection Association v. Union of India, 2017 SCC OnLine Mad 7056, the Division Bench of Madras High Court took note of and recorded the submission made on behalf of the Union of India that the relaxation was a one time relaxation. In view of such submission, this Court held that a one time relaxation was permissible.

47. It is, however, well settled that words and phrases and/or sentences in a judgment cannot be read in the manner of a statute, and that too out of context. The observation of the Division Bench that a one time relaxation was permissible, is not to be construed as a finding that relaxation cannot be made more than once. If power to amend or modify or relax a notification and/or order exists, the notification and/or order may be amended and/or modified as many times, as may be necessary. A statement made by counsel in Court would not prevent the authority concerned from making amendments and/or modifications provided such amendments and/or modifications were as per the procedure prescribed by law.

48. The Division Bench of Madras High Court fell in error in staying the said office memorandum, by relying on observations made by this Court in Alembic Pharmaceuticals Ltd. (supra), in the context of a circular which was contrary to the statutory Environment Impact Notification of 1994. The attention of the High Court was perhaps not drawn to the fact that the notification of 7^th July 2021 was in pursuance of the statutory notification of 2017 which was valid. The judgment of this Court in Alembic Pharmaceuticals Ltd. (supra), was clearly distinguishable and could have no application to the office memorandum dated 7^th July 2021 which was issued pursuant to the notification dated 14^th March 2017.

49. The Appellants have already applied for EC. The Expert Appraisal Committee of the MoEF&CC has, after scrutinizing the application of the Appellants and finding them eligible for grant of EC, recommended their cases for grant of Terms of Reference (ToR). ToR was granted to the Appellants and a public hearing had also been conducted. Only last procedural step of issuance of EC is left.

50. It is claimed that the units of the Appellants are totally non-polluting units having “Zero Trade discharge”. They have been in operation for many years. In the reply affidavit filed by the State before the NGT, it was mentioned that the units were operating in good faith with valid CTOs granted by the HSPCB. It was stated that the units were not causing pollution hazards. The only thing against the units was the procedural lapse of not obtaining EC.

51. By a communication No. F. No. IA-J-110011/185/2020-IA-II(I) dated 20^th July 2021 issued to the Appellant No.1, the MoEF&CC rejected the proposal for terms of reference on the purported ground that the activity of the Appellant No.1 was covered under category “A” of item 5(f) “Synthetic Organic Chemicals” of the Schedule to the EIA Notification, 2006. A similar communication was issued in respect of M/s Apcolite Polymers Pvt. Ltd. Significantly, by an order dated 9^th July 2021, the MoEF&CC had confirmed the minutes of an earlier meeting of the Expert Appraisal Committee and recommended issuance of ToR to the Appellant No.1, as observed above. The proposal for Terms of Reference has obviously been rejected at the final stage after the public hearing, by reason of the impugned order dated 3^rd June 2021 passed by the NGT on the application of Dastak, which is under appeal.

52. This appeal was listed for admission on 30^th September 2021, along with an application for interim relief being I.A. No. 110064 of 2021 praying for orders permitting the Appellants to operate their units during the pendency of the appeal. The appeal was heard at length at the admission stage and reserved for judgment along with the interim application by an order dated 30^th September 2021.

53. After receiving the communication dated 20^th July 2021 rejecting the proposal for Terms of Reference, the Appellants requested HSPCB to forward to the Appellants the proceedings of public hearing in respect of the manufacturing units of the Appellants. By a communication No. HSPCB/YR/2021/2830 dated 15^th February 2022, HSPCB forwarded proceedings of the public hearing in respect of the Yamuna Nagar unit of the Appellant No.1. By another Communication No. HSPCB/YR/29021/2829 dated 15^th February 2022 the HSPCB forwarded to the Appellant No.2 the proceedings of the public hearing held on 3^rdFebruary 2022 in connection with the Yamuna Nagar Unit of the Appellant No.2.

54. The manufacturing units of the Appellants appoint about 8,000 employees and have a huge annual turnover. An establishment contributing to the economy of the country and providing livelihood ought not to be closed down only on the ground of the technical irregularity of not obtaining prior Environmental Clearance irrespective of whether or not the unit actually causes pollution.

55. In Electrosteel Steels Limited v. Union of India, 2021 SCC online SC 1247, this Court held:-

“82. The question is whether an establishment contributing to the economy of the country and providing livelihood to hundreds of people should be closed down for the technical irregularity of shifting its site without prior environmental clearance, without opportunity to the establishment to regularize its operation by obtaining the requisite clearances and permissions, even though the establishment may not otherwise be violating pollution laws, or the pollution, if any, can conveniently and effectively be checked. The answer has to be in the negative.

83. The Central Government is well within the scope of its powers under Section 3 of the 1986 Act to issue directions to control and/or prevent pollution including directions for prior Environmental Clearance before a project is commenced. Such prior Environmental Clearance is necessarily granted upon examining the impact of the project on the environment. Ex-Post facto Environmental Clearance should not ordinarily be granted, and certainly not for the asking. At the same time ex post facto clearances and/or approvals and/or removal of technical irregularities in terms of Notifications under the 1986 Act cannot be declined with pedantic rigidity, oblivious of the consequences of stopping the operation of a running steel plant.

84. The 1986 Act does not prohibit ex post facto Environmental Clearance. Some relaxations and even grant of ex post facto EC in accordance with law, in strict compliance with Rules, Regulations Notifications and/or applicable orders, in appropriate cases, where the projects are in compliance with, or can be made to comply with environment norms, is in over view not impermissible. The Court cannot be oblivious to the economy or the need to protect the livelihood of hundreds of employees and others employed in the project and others dependent on the project, if such projects comply with environmental norms.

88. The Notification being SO 804(E) dated 14th March, 2017 was not an issue in Alembic Pharmaceuticals (supra). This Court was examining the propriety and/or legality of a 2002 circular which was inconsistent with the EIA Notification dated 27th January, 1994, which was statutory. Ex post facto environmental clearance should not however be granted routinely, but in exceptional circumstances taking into account all relevant environmental factors. Where the adverse consequences of ex post facto approval outweigh the consequences of regularization of operation of an industry by grant of ex post facto approval and the industry or establishment concerned otherwise conforms to the requisite pollution norms, ex post facto approval should be given in accordance with law, in strict conformity with the applicable Rules, Regulations and/or Notifications. Ex post facto approval should not be withheld only as a penal measure. The deviant industry may be penalised by an imposition of heavy penalty on the principle of ‘polluter pays’ and the cost of restoration of environment may be recovered from it.

***

96. The appeals are allowed. The impugned order is set aside. The Respondent No. 1 shall take a decision on the application of the Appellant for revised EC in accordance with law, within three months from date. Pending such decision, the operation of the steel plant shall not be interfered with on the ground of want of EC, FC, CTE or CTO.”

56. As held by this Court in Electrosteel Steels Limited (supra) ex post facto Environmental Clearance should not ordinarily be granted, and certainly not for the asking. At the same time ex post facto clearances and/or approvals and/or removal of technical irregularities in terms of a Notification under the EP Act cannot be declined with pedantic rigidity, oblivious of the consequences of stopping the operation of mines, running factories and plants.

57. The 1986 Act does not prohibit ex post facto Environmental Clearance. Grant of ex post facto EC in accordance with law, in strict compliance with Rules, Regulations, Notifications and/or applicable orders, in appropriate cases, where the projects are in compliance with, or can be made to comply with environment norms, is in our view not impermissible. The Court cannot be oblivious to the economy or the need to protect the livelihood of hundreds of employees and others employed in the project and others dependent on the project, if such projects comply with environmental norms.

58. As held by a three Judge Bench of this Court in Lafarge Umiam Mining Private Limited v. Union of India, (2011) 7 SCC 338 :-

“119. The time has come for us to apply the constitutional “doctrine of proportionality” to the matters concerning environment as a part of the process of judicial review in contradistinction to merit review. It cannot be gainsaid that utilization of the environment and its natural resources has to be in a way that is consistent with principles of sustainable development and intergenerational equity, but balancing of these equities may entail policy choices. In the circumstances, barring exceptions, decisions relating to utilisation of natural resources have to be tested on the anvil of the well-recognized principles of judicial review. Have all the relevant factors been taken into account? Have any extraneous factors influenced the decision? Is the decision strictly in accordance with the legislative policy underlying the law (if any) that governs the field? Is the decision consistent with the principles of sustainable development in the sense that has the decision-maker taken into account the said principle and, on the basis of relevant considerations, arrived at a balanced decision? Thus, the Court should review the decision-making process to ensure that the decision of MoEF is fair and fully informed, based on the correct principles, and free from any bias or restraint. Once this is ensured, then the doctrine of “margin of appreciation” in favour of the decision-maker would come into play.”

59. In Alembic Pharmaceuticals Ltd.{supra), this Court observed:-

“27. The concept of an ex post facto EC is in derogation of the fundamental principles of environmental jurisprudence and is an anathema to the EI A notification dated 27 January 1994. It is, as the judgment in Common Cause holds, detrimental to the environment and could lead to irreparable degradation. The reason why a retrospective EC or an ex post facto clearance is alien to environmental jurisprudence is that before the issuance of an EC, the statutory notification warrants a careful application of mind, besides a study into the likely consequences of a proposed activity on the environment. An EC can be issued only after various stages of the decision- making process have been completed. Requirements such as conducting a public hearing, screening, scoping and appraisal are components of the decision-making process which ensure that the likely impacts of the industrial activity or the expansion of an existing industrial activity are considered in the decision-making calculus. Allowing for an ex post facto clearance would essentially condone the operation of industrial activities without the grant of an EC. In the absence of an EC, there would be no conditions that would safeguard the environment. Moreover, if the EC was to be ultimately refused, irreparable harm would have been caused to the environment. In either view of the matter, environment law cannot countenance the notion of an ex post facto clearance. This would be contrary to both the precautionary principle as well as the need for sustainable development.”

60. Even though this Court deprecated ex post facto clearances, in Alembic Pharmaceuticals Ltd. (supra), this Court did not direct closure of the units concerned but explored measures to control the damage caused by the industrial units. This Court held:-

” However, since the expansion has been undertaken and the industry has been functioning, we do not deem it appropriate to order closure of the entire plant as directed by the High Court.”

61. The Notification being SO. 804(E) dated 14^th March 2017 was not in issue in Alembic Pharmaceuticals Ltd. (supra). In Alembic Pharmaceuticals Ltd. (supra) this Court was examining the propriety and/or legality of a 2002 circular which was inconsistent with the EIA Notification dated 27^th January 1994, which was statutory. The EIA Notification dated 27^th January 1994 has, as stated above, been superseded by the Notification dated 14^th September 2006.

62. There can be no doubt that the need to comply with the requirement to obtain EC is non-negotiable. A unit can be set up or allowed to expand subject to compliance of the requisite environmental norms. EC is granted on condition of the suitability of the site to set up the unit, from the environmental angle, and also existence of necessary infrastructural facilities and equipment for compliance of environmental norms. To protect future generations and to ensure sustainable development, it is imperative that pollution laws be strictly enforced. Under no circumstances can industries, which pollute, be allowed to operate unchecked and degrade the environment.

63. Ex post facto environmental clearance should not be granted routinely, but in exceptional circumstances taking into account all relevant environmental factors. Where the adverse consequences of denial of ex post facto approval outweigh the consequences of regularization of operations by grant of ex post facto approval, and the establishment concerned otherwise conforms to the requisite pollution norms, ex post facto approval should be given in accordance with law, in strict conformity with the applicable Rules, Regulations and/or Notifications. The deviant industry may be penalised by an imposition of heavy penalty on the principle of ‘polluter pays’ and the cost of restoration of environment may be recovered from it.

64. The question in this case is, whether a unit contributing to the economy of the country and providing livelihood to hundreds of people, which has been set up pursuant to requisite approvals from the concerned statutory authorities, and has applied for ex post facto EC, should be closed down for the technical irregularity of want of prior environmental clearance, pending the issuance of EC, even though it may not cause pollution and/or may be found to comply with the required norms. The answer to the aforesaid question has to be in the negative, more so when the HSPCB was itself under the misconception that no environment clearance was required for the units in question. HSPCB has in its counter affidavit before the NGT clearly stated that a decision was taken to regularize units such as the Apcolite Yamuna Nagar and Pahwa Yamuna Nagar Units, since requisite approvals had been granted to those units, by the concerned authorities on the misconception that no EC was required.

65. It is reiterated that the 1986 Act does not prohibit ex post facto EC. Some relaxations and even grant of ex post facto EC in accordance with law, in strict compliance with Rules, Regulations, Notifications and/or applicable orders, in appropriate cases, where the projects are in compliance with environment norms, is not impermissible. As observed by this Court in Electrosteel Steels Limited (supra), this Court cannot be oblivious to the economy or the need to protect the livelihood of hundreds of employees and others employed in the units and dependent on the units in their survival.

66. Ex post facto EC should not ordinarily be granted, and certainly not for the asking. At the same time ex post facto clearances and/or approvals cannot be declined with pedantic rigidity, regardless of the consequences of stopping the operations. This Court is of the view that the NGT erred in law in directing that the units cannot be allowed to function till compliance of the statutory mandate.

67. Accordingly, the appeal is allowed. The impugned order is set aside in so far as the same is applicable to the units of the Appellants established and operated pursuant to CTE and CTO from the HSPCB in respect of which applications for ex post facto EC have been filed. The Respondent shall take a decision on the applications of the Appellants for EC in accordance with law within one month from date. Pending decision, the operation of the Pahwa Yamuna Nagar Unit and the Apcolite Yamuna Nagar Unit, in respect of which consents have been granted and even public hearing held in connection with grant of EC, shall not be interfered with.

68. The Appellants will be allowed to operate the units. Electricity, if disconnected, shall be restored subject to payment of charges, if any. If the application for EC is rejected on the ground of any contravention on the part of the Appellants, it will be open to the Respondents to disconnect the supply of electricity.

69. The Union of India had proceeded with the application for EC and even public hearing had been held. Counsel appearing on behalf of the Union of India contended that the Appellant had not submitted its final application for EC, after public hearing. It is not clear what more was required of the Appellants. Be that as it may, the Union of India shall, within three working days from the date of receipt of a copy of this judgment and order, inform the Appellants in writing of whether anything further is required to be done by the Appellants, and if so what is required to be done. The Appellants shall, within a week thereafter do the needful. The final decision on the application of the Appellants for EC shall be taken within three weeks thereafter.

70. The application being I.A. No. 110064/2021 and other pending applications, if any, in this appeal are disposed of accordingly.

Posted on 4th March 2022 by rajatbindal5gmailcom — Leave a comment

तलाक में भरण पोषण का कानून

Posted on 4th March 20225th April 2022 by rajatbindal5gmailcom — Leave a comment

किरायेदार को देना पड़ेगा चार गुना किराया

Posted on 4th March 20224th March 2022 by rajatbindal5gmailcom — 1 Comment

Counter claim can be filed in divorce case to seek relief under Hindu Marriage Act 1955

(2021) 6 AndhLD 104 : (2021) 4 CivCC 673 : (2021) 3 DMC 433 : (2021) 6 KLT 57 : (2021) 4 RCR(Civil) 558 : (2021) 12 SCALE 350

SUPREME COURT OF INDIA

DIVISION BENCH

NITABEN DINESH PATEL — Appellant

Vs.

DINESH DAHYABHAI PATEL — Respondent

( Before : M.R. Shah and A.S. Bopanna, JJ. )

Civil Appeal Nos. 5901-5902 of 2021

Decided on : 07-10-2021

Hindu Marriage Act, 1955 – Section 23A – Relief of divorce – Counter claim – Third party – On a fair reading of Section 23A of the Hindu Marriage Act, the respondent in any proceedings for divorce or judicial separation or restitution of conjugal rights, may not only oppose the relief sought on the ground of adultery, cruelty or desertion, but also make a counterclaim for any relief under Hindu Marriage Act, i.e, on the ground of petitioner’s adultery, cruelty or desertion and if the petitioner’s adultery, cruelty or desertion is proved, the court may give to the respondent any relief under Hindu Marriage Act to which he or she would have been entitled if he or she had presented a petition seeking such relief on that ground, i.e., seeking a divorce or judicial separation on the ground of petitioner’s adultery or cruelty – Therefore, by way of counter claim, the respondent in any proceedings for divorce or judicial separation or restitution of conjugal rights can pray for the relief by way of counter claim only those reliefs which can be prayed and/or granted under the Hindu Marriage Act, namely, the relief under Section 9 (Restitution of conjugal rights); Section 10(judicial separation); Sections 11 & 12 (declaration of marriage between the petitioner and the respondent void) and Section 13 (divorce) – Under the provisions of the Hindu Marriage Act, the relief of divorce, judicial separation etc. can be between the husband and the wife only and cannot extend to the third party.

Counsel for Appearing Parties

Mr. Puneet Jain, Advocate, Ms. Christi Jain, Advocate, for the Appellant; Mr. Mihir Thakore, Sr. Advocate, Ms. Aastha Mehta, Advocate, Mr. Tirthraj Pandya, Advocate, Mr. Jaimin Dave, Advocate, Ms. Vishakha, Advocate, Ms. Prema Mohapatra, Advocate, Ms. Deepanwita Priyanka, Advocate, for the Respondent.

Cases Referred

Abdul Rehman v. Mohd. Ruldu, (2012) 11 SCC 341
Ajendraprasadji N. Pandey v. Swami Keshavprakeshdasji N., (2006) 12 SCC 1
Andhra Bank v. ABN Amro Bank, (2007) 6 SCC 167
Ashok Kumar Kalra v. Wing Commander Surendra Agnihotri, (2020) 2 SCC 394
Chander Kanta Bansal v. Rajinder Singh Anand, (2008) 5 SCC 117
Damodar v. Urmila, AIR 1980 Raj. 57
Gurbakhsh Singh v. Buta Singh, (2018) 6 SCC 567
M. Revanna v. Anjanamma (dead) by Lrs., (2019) 4 SCC 332
Vidyabai v. Padmalatha, (2009) 2 SCC 409

JUDGMENT

M.R. Shah, J. -Feeling aggrieved and dissatisfied with the impugned common judgment and order dated 27.09.2019 passed by the High Court of Gujarat at Ahmedabad in SCA No. 11379/2018 and SCA No. 16101/2018, by which the High Court has dismissed writ petition being SCA No. 11379/2018 and has allowed SCA No. 16101/2018 and has quashed and set aside the order passed by the learned Family Court dated 8.5.2018 passed below the application (Exhibit 281) in Family Suit No. 862/2007, the original writ petitioner in SCA No. 11379/2018 and the original respondent in SCA No. 16101/2018 has preferred the present appeals.

2. The facts leading to the present appeals in nutshell are as under:

The marriage between the appellant and the respondent took place on 1.3.1987 according to the Hindu rites. Out of the said wedlock, they had a child, named as ‘Devashya’ on 3.5.1990. The appellant was also a doctor, but it was the case on behalf of the appellant that after the birth of the child she stopped practising as a doctor and remained housewife. The dispute arose between the husband and the wife and the respondent-husband filed a Hindu Marriage Petition No. 862 of 2007 before the learned Family Court under Section 13 of the Hindu Marriage Act for dissolution of marriage, mainly on the ground that the appellant-wife is guilty of cruelty. The learned Family Court issued notice. The appellant-wife appeared and filed reply (Exhibit 9) on 11.4.2008. A rejoinder affidavit was also filed by the respondent-husband (Exhibit 10) on 22.9.2008. The appellant further submitted an affidavit-in-sur-rejoinder as Exhibit 13 in the month of November, 2008. The respondent-husband also filed an affidavit of evidence on record. According to the appellant-wife, the respondent-husband deserted her and their son on 9.2.2006 and the respondent-husband refused to provide maintenance for her and their son.

2.1 At this stage, it is required to be noted that in the written statement filed by the appellant-wife, it was the case on behalf of the appellant that the respondent-husband as on today is cohabiting with another woman, openly moves around with the said woman and introduces the said lady as his new wife and is travelling not only in the country but abroad with her. It was the case on behalf of the appellant-wife in the written statement that since the respondent-husband wants to marry the said woman, a false and fabricated story is placed before the Court. However, in the rejoinder affidavit filed by the respondent-husband, so stated in para 20, it was the case on behalf of the respondent-husband that so far as Ms. Hinaben Manubhai Panchal is concerned, the said lady is a manager in the hospital run by him and she is looking after the hospital and accounts as her job, which has nothing to do with the present dispute between the parties. It was the case on behalf of the appellant that subsequently she got to know that the respondent-husband had married the aforesaid Ms. Hinaben Manubhai Panchal and has suppressed the said fact, she filed an application (Exhibit 281) seeking amendment in her written statement by adding paras 35,36 & 37, which read as under:

“Para No. 35:

The opponent submits that the petition married with one Hinaben Manubhai Panchal on 14.12.2006 at Sudama resort, Paldi, Ahmedabad. The opponent stated that after the marriage solemnized between the petitioner and Hinaben, the petitioner filed the petition for divorce in the month of July 2007 against the opponent. The petitioner never informed to the Hon’ble Court that he married with Hinaben on 14.12.2006. When the petition was filed that time the petitioner intentionally suppress material facts with malafide intention. When the petitioner did not come before the Hon’ble Court with clean hand than the petitioner petition is legally not tenable under the provisions of the law. Moreover, due to the marriage life with Hinaben, the petitioner have having illegitimate son Dev, who is as on today residing with the petitioner;

The petitioner stated that there is no divorce granted in favour of the petitioner by the Hon’ble Court or the by the family court and opponent are as today alive even though the petitioner married with Hina Panchal, only for sex purpose. Even the petitioner gone to many places of the World with Hina and they were residing to gather because the petitioner accepted Hina as wife.

Moreover, the petitioner went to so many places with in India, either for honeymoon purpose or for enjoyment. The petitioner as on today living the life in adultery therefore the divorce cannot be granted in favour of the petitioner. Moreover, the person who does not come before the Hon’ble Court with clean hands are not entitled any relief from the Court. Therefore, the petition filed by the petitioner are require to dismiss with cost.

The opponent states that as on today the marriage between the petitioner and the respondent are continued, no divorce are granted by any court even though the petitioner married with Hina Panchal on 14.12.2006.

Therefore, the marriage between the petitioner and Hina Manubhai Panchal are illegal, void and voidable. Therefore, there is a necessary to declare by Court that the marriage between the petitioner and Hinaben Manubhai Panchal are illegal, void and voidable. Therefore, the present counter claim application are filed by the petitioner.

Para No. 36:-

The respondent states that by doing the marriage by petitioner with Hinaben Panchal, it is a fraud with the respondent and therefore the provision of the limitation are not applicable in the present matter.

The opponent states that the cause of action of the counter claim is arisen when the petitioner done the second marriage with Hinaben Manubhai Panchal. The cause of action is continue day to day for declaring between the petitioner and Hinaben marriage illegal, void, voidable. Moreover the cause of action have arisen when the respondent have come to know that the petitioner have intentionally done the fraud with the respondent by doing the second marriage with Hinaben Panchal. Even when the first marriage between the petitioner and respondent are continued. Moreover till the second between the petitioner and Hinaben Panchal are not declare illegal, void and voidable till that the cause of action of the counter claim are continued. The marriage between the petitioner and Hinaben Panchal are illegal, void and voidable therefore the cause of action of the present counter claim application are arisen in the jurisdiction of this Court.

Para No. 37:-

Therefore, the respondent prays that,

a. Your Honor may allow the present counter claim application anddeclare that the marriage between the petitioner with Hina Manubhai Panchal dated 14.12.2006 are illegal, void and voidable. Further declare that Hina Panchal is not the legal wife of the petitioner and also declare that the petitioner are living with Hina Panchal in adultery.

b. Your Honor may declare that son Dev, born through the petitionerand Hinaben Panchal marriage life is illegitimate child of the petitioner.

c. Your Honor grant any other relief which your Honor think properand reasonable.

d. Cost of this application.

e. The proper court fees are affixed upon the application.”

2.2 By order dated 8.5.2018, the learned Family Court partly allowed the said application (Exhibit 281) and allowed the amendments by permitting the appellant-wife to incorporate paras 35 and 36 in the written statement and refused to permit the appellant-wife to amend the written statement as per para 37. At this stage, it is required to be noted that before the learned Family Court, the appellant-wife in support of her prayer to permit the amendment by adding para 37 heavily relied upon the provisions of Section 23A of the Hindu Marriage Act.

2.3 Aggrieved by the order passed by the learned Family Court rejecting her prayer to add the prayer clause in terms of para 37 and refusing to permit the amendment in terms of para 37, the appellant-wife preferred SCA No. 11379/2018 before the High Court. Simultaneously, the respondent-husband also challenged the order passed by the learned Family Court allowing and/or permitting the appellant-wife to add paras 35 and 36 in the written statement before the High Court being SCA No. 16101/2018. By the impugned judgment and order, the High Court has allowed the respondent-husband’s writ petition being SCA No. 16101/2018 and dismissed the appellant-wife’s writ petition being SCA No. 11379/2018 on the ground that the amendment could not be allowed at this belated stage. However, the High Court in the impugned judgment and order has observed that the appellant can file a separate suit seeking for a declaration that the second marriage of the respondent-husband is void.

2.4 Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the High Court, rejecting the application (Exhibit 281) preferred by the appellant-wife and not permitting the amendment as per paras 35, 36, and 37 in the written statement, the appellant-wife has preferred the present appeals. At this stage, it is required to be noted that the proposed prayer in terms of para 37 to declare that the second marriage between the respondent-husband and Hinaben Manubhai Panchal dated 14.12.2006 is illegal, void and voidable was as a counter claim and for that Section 23A of the Hindu Marriage Act was relied upon.

3. Shri Puneet Jain, learned Advocate has appeared on behalf of the appellant-wife and Shri Mihir Thakore, learned Senior Advocate, assisted by Ms. Aastha Mehta, learned Advocate, has appeared for the respondent-husband.

3.1 Shri Puneet Jain, learned Advocate appearing on behalf of the appellant has vehemently submitted that the marriage between the appellant and the respondent was solemnized on 1.3.1987 and a child named ‘Devashya’ was born.

3.2 It is submitted that during the subsistence of the marriage, the respondent-husband developed illicit relationship with one Hinaben Manubhai Panchal. The respondent-husband filed a petition under Section 13 of the Hindu Marriage Act on 6.8.2007 seeking divorce from the appellant. The fact regarding his entering into a marriage with the aforesaid Hinaben Manubhai Panchal on 14.12.2006 was deliberately suppressed by the respondent-husband. It is submitted that however at the relevant time the fact of illicit relationship of the respondent with Hinaben Manubhai Panchal was only known to the appellant and specific submissions/averments were made in the written statement dated 19.6.2008.

3.3 It is submitted that in the rejoinder affidavit, as such, the respondent-husband did not specifically deny the allegations of illicit relationship with Hinaben Manubhai Panchal but submitted that so far as Ms. Hinaben Manubhai Panchal is concerned, the said lady is a manager in the hospital run by him and she is looking after the hospital and accounts as a job.

3.4 It is submitted that when the rejoinder affidavit was filed in 2008, the respondent-husband did not disclose the factum of marriage on 14.12.2006 between the respondent-husband and the said Hinaben Manubhai Panchal. It is submitted therefore and thus the appellant was not aware about the respondent’s entering into the marriage with Hinaben Manubhai Panchal earlier. It is submitted that it came on record during the cross-examination of the respondent which concluded in 2017 that in fact he had entered into a second marriage with Hinaben Manubhai Panchal on 14.12.2006. Even the marriage certificate was produced on record as Exhibit 200. It also came on record that the respondent has a son named ‘Dev’ from the said illegal relationship and his birth certificate has also been produced on record as Exhibit 201.

3.5 It is submitted that therefore the appellant was absolutely justified in submitting the application (Exhibit 281) for amendment of the written statement to add paras 35 and 36 to plead the facts regarding the second marriage and also to seek relief in the nature of counter claim vide para 37 seeking a declaration inter alia that the marriage between the respondent and the said Hinaben Manubhai Panchal is null and void and that Hinaben Manubhai Panchal is not a legal wife of the respondent-husband and that he was living with her in adultery.

3.6 It is submitted that a declaration was also sought that the son ‘Dev’ born to the respondent with Hinaben Manubhai Panchal is an illegitimate child.

3.7 It is submitted that however the learned Family Court allowed the application in part allowing addition of paras 35 and 36 but did not permit amendment in the written statement to add/introduce counter claim in terms of para 37. It is submitted that even the order dated 8.5.2018 passed by the learned Family Court allowing the introduction/addition of paras 35 & 36 has also been set aside by the High Court, by the impugned judgment and order.

3.8 Shri Puneet Jain, learned Advocate appearing on behalf of the appellant has vehemently submitted that, as such, in the facts and circumstances of the case, narrated hereinabove, the application filed by the appellant-wife for amendment of the written statement is required to be allowed in toto. It is submitted that the fact regarding actual marriage of the respondent-husband with Hinaben Manubhai Panchal (third party) was not known to the appellant, which fact came to the knowledge only during cross-examination of the respondent in the present proceedings when the marriage certificated Ex. 200) as well as the birth certificate of his son ‘Dev’ (Ex. 201) out of the marriage between the respondent and Hinaben Manubhai Panchal came on record as Ex. 201.

3.9 It is submitted that soon thereafter the appellant filed an application for impleadment of Ms. Hinaben Manubhai Panchal as a party and the application for amendment of the written statement, Ex. 281. It is submitted that therefore at the first available opportunity after the appellant came to know about the actual marriage between the respondent and Hinaben Manubhai Panchal, which came to light in the year 2017, the application (Ex. 281) was filed and therefore the same ought to have been allowed.

3.10 It is submitted that the High Court has materially erred in rejecting the application (Ex. 281) on the ground that once the written statement has been filed, the defendant cannot be permitted to amend the written statement. It is submitted that in the facts and circumstances of the case, the High Court has erred in relying upon and/or has misconstrued the provisions of Order VIII, Rules 8 & 9 CPC and proviso to Order VI Rule 17 CPC.

3.11 It is submitted that even the factum of actual marriage between the respondent and Hinaben Manubhai Panchal on 14.12.2006 came to the knowledge of the appellant after filing of the written statement and therefore the appellant can be permitted to amend the written statement bringing on record the factum of actual marriage on 14.12.2006 between the respondent and Hinaben Manubhai Panchal and the bar contained in proviso to Order VI rule 17 CPC shall not come in the way and in any case the same may be permitted with the leave of the Court to either amending the written statement or by filing an additional written statement.

3.12 It is submitted that as such there was no delay in filing the application (Ex.281) under Order VI Rule 17 CPC from the date of knowledge of the actual marriage which came to light during the cross-examination of the respondent. It is submitted that even otherwise delay is no ground for refusal of prayer for amendment of a written statement. Reliance is placed on the decision of this Court in the case of Andhra Bank v. ABN Amro Bank, (2007) 6 SCC 167 (para 5). It is submitted that even the High Court has proceeded on an erroneous premise assuming knowledge of illicit relationship as knowledge of marriage between the respondent and Hinaben Manubhai Panchal.

3.13 It is further submitted that power to allow amendment is wide and is to be liberally construed; the Court is only required to see that if the amendment causes any prejudice to the other party. It is submitted that as such the learned Family Court has specifically found that no prejudice shall be caused to the respondent due to the amendment. Reliance is placed on the decisions of this Court in the cases of Chander Kanta Bansal v. Rajinder Singh Anand, (2008) 5 SCC 117 (para 11); Abdul Rehman v. Mohd. Ruldu, (2012) 11 SCC 341 (para 11); and Gurbakhsh Singh v. Buta Singh, (2018) 6 SCC 567 (paras 4 & 5).

3.14 It is submitted that as such the underlying principle behind allowing the application under Order VI Rule 17 CPC or to raise a counter claim under Order VIII Rule 6A is to prevent multiplicity of proceedings. It is submitted that the grounds raised in the amendment vide paras 35 and 36 are not only in the nature of a defence against the allegations of desertion and cruelty, but also constitute necessary pleadings in support of relief sought for in the counter claim. It is submitted that the amendment sought for would not change the character of the suit.

3.15 It is further submitted that even the relief sought in terms of para 37 is the counter claim for declaring the marriage of the respondent-husband with Hinaben Manubhai Panchal as null and void and for the legitimacy of their son ‘Dev’ is consequential in view of the undisputed and admitted fact that the marriage between the appellant and the respondent is still subsisting. It is submitted that it is to be noted that as such the present proceedings filed by the respondent-husband are to seek a decree for divorce under Section 13 of the Hindu Marriage Act which has yet not been decided and therefore as on today the marriage between the appellant and the respondent is subsisting. It is submitted that therefore the marriage between the respondent and Hinaben Manubhai Panchal is thus illegal under Section 5(a) of the Hindu Marriage Act. It is submitted that therefore the relief sought for in the counter claim is undeniable on admitted facts and will have to be granted “irrespective” of the outcome of the petition filed by the respondent under Section 13 of the HMA. It is submitted that as such the counter claim is permissible as per Section 23A of the HMA.

3.16 It is further submitted that even otherwise the cause of action for filing the counter claim has arisen after filing of the written statement and more particularly in the cross-examination of the respondent-husband that the respondent had got married to Hinaben Manubhai Panchal on 14.12.2006. It is submitted that therefore also the declaration as sought for in para 37 by way of counter claim ought to have been permitted/allowed. Reliance is placed on the decision of this Court in the case of Ashok Kumar Kalra v. Wing Commander Surendra Agnihotri, (2020) 2 SCC 394 (paras 12 to 18 & 21).

3.17 It is further submitted that even otherwise a counter claim is in any case is to be decided as an independent suit and so long as the relief sought for is otherwise within limitation, the same can be entertained. In the present case, the petition under Section 13 was still at the stage of evidence, wherein the appellant – original defendant has to lead evidence in defence who could lead common evidence for defence and counter claim and the respondent-husband can be permitted to rebut, if so required. It is submitted that therefore no prejudice would thus be caused to the respondent if application (Ex. 281) is allowed in toto.

3.18 Making the above submissions and relying upon the aforesaid decisions, it is prayed to allow the present appeals.

4. The present appeals are vehemently opposed by Shri Mihir Thakore, learned Senior Advocate appearing on behalf of the respondent-husband. Insofar as amendment sought vide para 37 in Ex.281, i.e., declaration sought that marriage between the respondent-husband and Hinaben Manubhai Panchal is null and void is concerned, it is submitted that such prayer which is in the nature of counter claim cannot be granted.

4.1 It is submitted that it is true that Section 23A of the Hindu Marriage Act permits the respondent to raise a counter claim. It is submitted that however under Section 23A, by way of counter claim, firstly, the respondent can seek relief against the petitioner on the ground of petitioner’s adultery, cruelty or desertion and secondly, the petitioner can seek only such relief as is maintainable under the Hindu Marriage Act, 1955 and not otherwise. It is submitted that under the HMA, 1955 the respondent can seek relief under Section 9 to 13 only. It is submitted that therefore by virtue of Section 23A, it is not open for the respondent (appellant herein) to seek a declaration to the effect that marriage between the respondent-husband and the third party (Hinaben Manubhai Panchal) is void. It is submitted that such relief falls within the ambit of Section 34 of the Special Relief Act, 1963 and in any case, it does not fall within any of the provisions of Sections 9 to 13 of the Hindu Marriage Act. Reliance is placed on the decision of the Rajasthan High Court in the case of Damodar v. Urmila, AIR 1980 Raj. 57.

4.2 Now so far as the amendment sought vide paragraphs 35 and 36 in Ex. 281 application is concerned, it is vehemently submitted that this prayer is required to be rejected inter alia on the ground that it is barred by proviso to Order VI Rule 17 CPC. It is submitted that as such the appellant-wife had knowledge about the factum of alleged respondent-husband’s second marriage with Hinaben Manubhai Panchal since 23.03.2007. It is submitted that the appellant-wife in the cross-examination recorded as Ex.359 has categorically admitted that her lawyer applied for so called marriage certificate on 12.03.2007 and he was supplied copy thereof on 23.03.2007. It is submitted that she also categorically admitted that despite having knowledge about the alleged marriage certificate since 23.03.2007, she did not mention about the alleged marriage of the respondent-husband with Hinaben Manubhai Panchal. It is submitted that therefore it is not open for the appellant-wife to file such an application at such a belated stage.

4.3 Learned Senior Counsel appearing on behalf of the respondent-husband has relied upon the following timeline which according to him is relevant for the purpose of considering amendment sought vide paragraphs 35 and 36 in Ex.281 application, which are as under:

Date	Event
2007	H.M.P. Suit No.862 of 2007 was instituted
27.03.2007	Appellant – Wife admittedly acquired knowledge about alleged marriage of Respondent – Husband
11.04.2008	Appellant – Wife filed written statement
22.09.2008	Respondent – Husband filed rejoinder
20.04.20017	Application filed for draft amendment

It is submitted that not only that but in the impugned judgment and order the High Court has also arrived at the specific conclusion that the appellant-wife had definite knowledge about the alleged marriage since 2007.

4.4 It is submitted that today we are at the stage of cross-examination of the appellant-wife and at this stage with a mala fide intention of delaying the proceedings such an application is filed. It is submitted that such an amendment is hit by proviso to Order VI Rule 17 CPC.

4.5 It is further submitted that proviso to Order VI Rule 17 CPC virtually prevents an application for amendment of pleadings from being allowed after the trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of the trial and a trial is deemed to have commenced. It is submitted therefore that the proviso to an extent curtails absolute discretion to allow amendment at any stage. The burden is on the person who seeks an amendment after commencement of the trial to show that inspite of due diligence, such an averment could not have been made earlier. Heavy reliance is placed on the decisions of this Court in the cases of Ajendraprasadji N. Pandey v. Swami Keshavprakeshdasji N., (2006) 12 SCC 1 (Paras 55,60 to 62); M. Revanna v. Anjanamma (dead) by Lrs., (2019) 4 SCC 332 (paras 7 to 9); Chander Kanta Bansal (supra) (paras 11 to 13,15, 17, 19 & 20); and Vidyabai v. Padmalatha, (2009) 2 SCC 409 (paras 11 to 13,19 & 21).

4.6 It is submitted that by virtue of Section 10 of the Family Courts Act, 1984 and Section 21 of Hindu Marriage Act, 1955, the provisions of CPC apply to proceedings under HMA and therefore proviso to Order VI Rule 17 CPC would come into play.

4.7 Making the above submissions and relying upon the aforesaid decisions, it is prayed to dismiss the present appeals.

5. We have heard the learned counsel for the respective parties at length.

By the impugned judgment and order, the High Court has dismissed the application (Ex.281) filed by the appellant herein in the family Court by which the appellant prayed to amend the written statement as per paragraphs 35, 36 and 37, reproduced hereinabove. By incorporating paragraphs 35 and 36, the appellant proposed to amend the written statement bringing on record the factum of marriage of the respondent with one Hinaben Manubhai Panchal on 14.12.2006 and other factual aspects. So far as the amendment sought vide para 37 is concerned, the same was for incorporating the prayer by way of counterclaim under Section 23 of the Hindu Marriage Act. As observed hereinabove, the learned Family Court partly allowed the application (Ex.281) and permitted the amendment in the written statement as per paras 35 and 36. However, rejected the amendment sought vide para 37. While refusing the amendment sought qua para 37, the learned Family Court observed that the appellant – original defendant cannot seek the proposed relief and in view of Section 23A of the Hindu Marriage Act, the defendant can seek relief under the Hindu Marriage Act only on the ground of adultery, cruelty or desertion and cannot seek the relief to declare that the second marriage of the respondent with Hinaben Manubhai Panchal (third party) is illegal, void, voidable etc. and as the appellant is not seeking any relief under the Hindu Marriage Act, she cannot seek the relief as proposed in para 37 as a counter claim. However, by the impugned judgment and order, the High Court has dismissed the entire application (Ex.281) mainly on the ground that once a written statement is filed and the trial has commenced, application to amend the written statement in exercise of powers under Order VI Rule 17 CPC is not required to be entertained and that in view of Order VIII Rule 6A CPC, the defendant can pray for a counter claim against the plaintiff either before or after the filing of the suit but before the defendant has delivered his defence (written statement) or before the time limited for delivering his defence has expired. Mainly relying upon the embargo under Order VI Rule 17 CPC and Order VIM Rule 6A CPC, the High Court has dismissed the application (Ex.281) in toto.

6. While deciding the issues involved in the present appeals, the relevant provisions of the CPC, namely, Order VI Rule 17 CPC and Order VIII Rule 6A CPC are required to be referred to, which read as under:

“Order VI Rule 17

17. Amendment of Pleadings – The Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties:

Provided that no application for amendment shall be allowed after the trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of the trial.

Order VIM. Rule 6A

6A – Counter-claim by defendant – (1) A defendant in a suit may, in addition to his right of pleading a set-off under rule 6, set up, by way of counter-claim against the claim of the plaintiff, any right or claim in respect of a cause of action accruing to the defendant against the plaintiff either before or after the filing of the suit but before the defendant has delivered his defence or before the time limited for delivering his defence has expired, whether such counter-claim is in the nature of a claim for damages or not:

Provided that such counter-claim shall not exceed the pecuniary limits of the jurisdiction of the Court.

(2) Such counter-claim shall have the same effect as a cross-suit so as to enable the Court to pronounce a final judgment in the same suit, but on the original claim and on the counter-claim.

(3) The plaintiff shall be at liberty to file a written statement in answer to the counter-claim of the defendant within such period as may be fixed by the Court.

(4) The counter-claim shall be treated as a plaint and governed by the rules applicable to plaints.”

7. Order VI Rule 17 CPC provides for amendment of the pleadings. The Court may at any stage of the proceedings allow either party to alter or amend his pleadings (including written statement) in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties. Proviso to Order VI Rule 17 CPC further provides that no application for amendment shall be allowed after the trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of the trial. Relying upon the proviso to Order VI Rule 17 CPC, the High Court has refused the amendment sought qua paragraphs 35 and 36. However, it is required to be noted that as per the case of the appellant-wife, she actually came to know about the actual marriage between the respondent and Hinaben Manubhai Panchal on 14.12.2006 only during the cross-examination of the respondent and when the marriage certificate was produced on record. It is required to be noted that right from the very beginning, it was the specific case on behalf of the appellant that the respondent-husband is living in adultery with Hinaben Manubhai Panchal and in the rejoinder affidavit filed by the respondent-husband, the respondent -husband denied the allegation of adultery and stated that Hinaben Manubhai Panchal is manager in the hospital run by him and she is looking after the hospital and accounts as a job. Though, the respondent-husband had married with Hinaben Manubhai Panchal on 14.12.2006, he did not disclose the correct and true facts and suppressed the material facts. Only in the cross-examination, he admitted the marriage with Hinaben Manubhai Panchal on 14.12.2006 and produced the marriage certificate. Therefore, in view of the above, the restrictions as per the proviso to Order VI Rule 17 CPC shall not be applicable. The proviso to Order VI Rule 17 CPC that no application for amendment shall be allowed after the trial has commenced unless the court comes to the conclusion that in spite of due diligence the party could not have raised the matter before the commencement of trial. Therefore, if some facts have come to the knowledge subsequently and subsequent to the commencement of trial, may be during the course of trial and if it is found that it is necessary for the purpose of determining the real questions in controversy between the parties, on a fair reading of Order VI Rule 17 CPC, such an application for amendment can be allowed even after the trial has commenced. In the present case, as observed hereinabove, the factum of actual marriage on 14.12.2006 came to the knowledge of the appellant-wife when the marriage certificate was produced during the cross-examination of the respondent-husband and immediately thereafter the application (Ex.281) for amendment was made. Therefore, as such, and looking to the case on behalf of the appellant, so pleaded in the written statement, the learned Family Court was right and justified in allowing the amendment sought qua paras 35 and 36. The High Court has committed an error in misapplying the proviso to Order VI Rule 17 CPC and has erred in rejecting the amendment sought qua paras 35 and 36 in application (Ex.281).

8. Now so far as the amendment sought qua para 37 in Ex.281 application is concerned, at the outset, it is required to be noted that it was in the form of counter-claim. It is true that as per Order VIII Rule 6A CPC, a defendant in a suit may, in addition to his right of pleading a set-off under rule 6, set up, by way of counter-claim against the claim of the plaintiff, any right or claim in respect of a cause of action accruing to the defendant against the plaintiff either before or after the filing of the suit but before the defendant has delivered his defence or before the time limited for delivering his defence has expired, whether such counterclaim is in the nature of a claim for damages or not. However, in the present case, according to the appellant, the cause for counter claim had accrued after the appellant-defendant has delivered her defence (written statement) and more particularly when during the cross-examination of the plaintiff (respondent herein) the factum of marriage with Hinaben Manubhai Panchal on 14.12.2006 was admitted and the marriage certificate was produced. Therefore, the High Court is not justified and/orright in refusing to allow the counter claim as proposed in para 37 on the ground that the same is not permissible after the appellant as defendant has delivered her defence by filing the written statement. On the aforesaid ground, the High Court ought not to have rejected the amendment sought qua para 37.

However, at the same time, the core question which is required to be considered is, whether the appellant-wife could have claimed the relief sought qua para 37 by way of counter claim in a marriage petition filed by the respondent-husband for dissolution of the marriage?

9. As per para 37, the appellant-original defendant has proposed the relief to declare that the marriage between the respondent-original plaintiff with Hinaben Manubhai Panchal on 14.12.2006 is illegal, void and voidable and further to declare that Hinaben Manubhai Panchal is not a legal wife of the respondent – original plaintiff and also to declare that the original plaintiff – respondent herein is living with Hinaben Manubhai Panchal in adultery. It is also further prayed to declare that the son ‘Dev’ born through the respondent and Hinaben Manubhai Panchal is not a legitimate child of the respondent-original plaintiff.

On a fair reading of Section 23A of the Hindu Marriage Act, we are afraid that the relief sought by way of counter claim in the Hindu Marriage Petition filed by the respondent can be claimed. Section 23A of the Hindu Marriage Act reads as under:

“23A. Relief for respondent in divorce and other proceedings – In any proceeding for divorce or judicial separation or restitution of conjugal rights, the respondent may not only oppose the relief sought on the ground of petitioner’s adultery, cruelty or desertion, but also make a counter-claim for any relief under this Act on that ground; and if the petitioner’s adultery, cruelty or desertion is proved, the court may give to the respondent any relief under this Act to which he or she would have been entitled if he or she had presented a petition seeking such relief on that ground.”

On a fair reading of Section 23A of the Hindu Marriage Act, the respondent in any proceedings for divorce or judicial separation or restitution of conjugal rights, may not only oppose the relief sought on the ground of adultery, cruelty or desertion, but also make a counterclaim for any relief under Hindu Marriage Act, i.e, on the ground of petitioner’s adultery, cruelty or desertion and if the petitioner’s adultery, cruelty or desertion is proved, the court may give to the respondent any relief under Hindu Marriage Act to which he or she would have been entitled if he or she had presented a petition seeking such relief on that ground, i.e., seeking a divorce or judicial separation on the ground of petitioner’s adultery or cruelty. Therefore, by way of counter claim, the respondent in any proceedings for divorce or judicial separation or restitution of conjugal rights can pray for the relief by way of counter claim only those reliefs which can be prayed and/or granted under the Hindu Marriage Act, namely, the relief under Section 9 (Restitution of conjugal rights); Section 10 judicial separation); Sections 11 & 12(declaration of marriage between the petitioner and the respondent void) and Section 13 (divorce). Therefore, the respondent to the aforesaid proceedings can pray for the aforesaid reliefs only by way of counter claim and that too between the petitioner and the respondent. No relief can be prayed qua the third party. Under the provisions of the Hindu Marriage Act, the relief of divorce, judicial separation etc. can be between the husband and the wife only and cannot extend to the third party. Therefore, by virtue of Section 23A of the Hindu Marriage Act, it is not open for the appellant herein – original defendant to seek declaration to the effect that the marriage between the respondent – original plaintiff and the third party – Hinaben Manubhai Panchal is void. No relief can be prayed by way of counter claim even against ‘Dev’, the son born out of the alleged wedlock between the respondent – original plaintiff and the third party – Hinaben Manubhai Panchal. In such a situation, the only remedy available to the appellant would be to file a substantive suit and/or initiate independent proceedings claiming such reliefs. But such reliefs cannot be claimed by way of counter claim under Section 23A of the Hindu Marriage Act in the petition for divorce filed by the respondent herein against the appellant. At the most, the appellant herein – original defendant by way of counter claim could have claimed the relief and prayed for divorce and/or judicial separation on the ground of husband’s adultery. Beyond that, no relief which cannot be granted under the provisions of the Hindu Marriage Act can be claimed by way of counter claim.

10. An identical question came to be considered by the Rajasthan High Court in the case of Damodar (supra) and the Rajasthan High Court observed as under:

“…As already stated, the matrimonial Court has no jurisdiction to go into the factum or validity of the alleged divorce obtained by the husband from the community Panchayat in accordance with the so-called custom prevalent in the community. This is a matter which falls squarely within the jurisdiction of the Civil Courts. Section 9 of the CPC lays down that the Civil Courts shall have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred. A perusal of the relevant provisions of the Act would show that it is a complete code in itself creating new rights for an aggrieved spouse governed by the Act to obtain decree of restitution of conjugal rights judicial separation, nullity of marriage and divorce, as the case may be. Sections 9 to 13 deal with the rights of an aggrieved spouse to make an application seeking appropriate relief against the other spouse, Section 19 which provides for forum for seeking such relief lays down that every petition under the Act shall be presented to the District Court, within the local limits of whose ordinary original civil jurisdiction the cause of action arose in the manner and circumstances specified in Cls. (i), (ii), (iii) and (iv) of that Section. The words “every petition under this Act” occurring in this Section have reference clearly to the petitions under Sections 9 to 13 of the Act. The Act does not make any provision for the grant of relief to a spouse interested in getting a declaration that he or she, has already obtained dissolution of marriage according to custom or usage from the community Panchayat and that the aid dissolution is valid and binding on the two spouses. Similarly, there is no provision in the Act, to enable a spouse, against whom a petition is filed by the other spouse under any of the Sections from 9 to 18, to raise a plea indefence that he or she has already obtained dissolution of the marriage from the community Panchayat or the like according to custom governing the parties, and that, therefore, the marriage is no longer subsisting. It can, therefore, be safely held that the Act which deals with certain matrimonial disputes among the Hindus does not make any provision for adjudication of a claim or defence, that the marriage between the contending parties already stands dissolved by virtue of the decision of a private forum like the Panchayat of the tribe, community, group or family, as the case may be. Such adjudication can, therefore, be obtained only from the Civil Court and not from the matrimonial Court under the Act.”

We are in complete agreement with the view taken by the Rajasthan High Court.

11. In view of the above and for the reasons stated above, the present appeals succeed in part. The impugned judgment and order passed by the High Court is hereby quashed and set aside. The order passed by the learned Family Court dated 8.5.2018 passed in the application (Ex. 281) is hereby restored and the appellant herein -original defendant is permitted to amend the written statement as prayed qua paras 35 and 36. The amendment sought by the appellant qua para 37 is hereby dismissed. However, it will be open for the appellant to initiate independent proceedings by way of filing a substantive suit and/or any other remedy which may be available to the appellant under law with respect to prayer sought qua para 37.

12. The present appeals are partly allowed to the aforesaid extent. However, in the facts and circumstances of the case, there shall be no order as to costs.

Posted on 2nd March 2022 by rajatbindal5gmailcom — Leave a comment

Availing overdraft facility to expand business is a commercial activity – Consumer forum does not have jurisdiction

DIVISION BENCH

SHRIKANT G. MANTRI — Appellant

Vs.

PUNJAB NATIONAL BANK — Respondent

( Before : L. Nageswara Rao and B.R. Gavai, JJ. )

Civil Appeal No. 11397 of 2016

Decided on : 22-02-2022

Consumer Protection Act, 1986 – Section 2(1)(d) – Consumer Complaint – Order passed by the National Consumer Disputes Redressal Commission complainant was not a consumer as envisaged under Section 2(1)(d) of The Consumer Protection Act, 1986 – Appeal against same – Relations between the appellant and the respondent is purely “business to business” relationship – As such, the transactions would clearly come within the ambit of ‘commercial purpose’. It cannot be said that the services were availed “exclusively for the purposes of earning his livelihood” “by means of self-employment” – If the interpretation as sought to be placed by the appellant is to be accepted, then the ‘business to business’ disputes would also have to be construed as consumer disputes, thereby defeating the very purpose of providing speedy and simple redressal to consumer disputes – No error with the findings of the Commission – Appeal dismissed.

Cases Referred

CBI, AHD, Patna vs. Braj Bhushan Prasad and others, (2001) 9 SCC 432
Cheema Engineering Services vs. Rajan Singh, (1997) 1 SCC 131
Internet and Mobile Association of India vs. Reserve Bank of India, (2020) 10 SCC 274
Kalpavruksha Charitable Trust vs. Toshniwal Brothers (Bombay) Pvt. Ltd. and another, (2000) 1 SCC 512
Laxmi Engineering Works vs. P.S.G. Industrial Institute, (1995) 3 SCC 583
Lilavati Kirtilal Mehta Medical Trust vs. Unique Shanti Developers and others, (2020) 2 SCC 265
Paramount Digital Colour Lab and others vs. AGFA India Private Limited and others, (2018) 14 SCC 81
Sunil Kohli and another vs. Purearth Infrastructure Limited, (2020) 12 SCC 235

JUDGMENT

B.R. Gavai, J. – The present appeal filed by the appellant- complainant challenges the judgment and order dated 1^stJune, 2016, passed by the National Consumer Disputes Redressal Commission, New Delhi (hereinafter referred to as “the Commission”) in Consumer Complaint No. 55 of 2006, thereby holding that the appellant-complainant was not a consumer as envisaged under Section 2(1)(d) of The Consumer Protection Act, 1986 (hereinafter referred to as “the said Act”). As such, by the impugned judgment and order, the complaint of the appellant has been dismissed being not maintainable.

2. The facts in the present case are not in dispute. The bare necessary facts for adjudication of the present appeal are as under:

3. The appellant-complainant had opened an account with erstwhile Nedungadi Bank Limited (hereinafter referred to as “the erstwhile Bank”) in the year 1998. The appellant is a stock-broker by profession. The appellant had applied for an overdraft facility on 25^th April, 1998, in connection with his day-to-day share and stock transactions. It is not in dispute that the said overdraft facility was sanctioned by the erstwhile Bank to the appellant-complainant initially for an amount of Rs.1 crore, for which the appellant-complainant had pledged certain shares worth more than Rs.1 crore, as security as per the margin requirements specified by the erstwhile Bank. Subsequently, in the year 1999, the appellant-complainant applied for enhancement of the said overdraft facility. The said overdraft facility was enhanced by the erstwhile Bank from Rs. 1 crore to Rs. 5 crore, vide its letter dated 13^th December, 1999.

4. Again, in March 2001, the appellant-complainant approached the erstwhile Bank for temporary increase in the overdraft limit. The erstwhile Bank, vide its letter dated 17^thMarch, 2001, granted the request of the appellant and temporarily enhanced the overdraft facility from Rs.5 crore to Rs.6 crore, for a period of one week.

5. It appears that due to steep fall in the share market, the erstwhile Bank, vide its letters dated 16^th and 17^th March, 2001, called upon the appellant-complainant to pledge additional shares to regularize the overdraft account. As an additional security, the appellant-complainant pledged 37,50,000 equity shares of face value of Rs.10/- of unlisted company Ansal Hotels Ltd. (hereinafter referred to as “the said shares”) towards the dues of the Bank, vide his letter dated 30^th March, 2001. It is not in dispute that subsequently, consequent to the merger of Ansal Hotels Ltd. with ITC Ltd., and the bonus and splitting of ITC shares, the aforesaid 37,50,000 equity shares of Ansal Hotels Ltd. became equivalent to 3,75,000 shares of ITC Ltd.

6. It appears that during 2001, the overdraft account of the appellant-complainant became irregular and as such, the erstwhile Bank called upon the appellant-complainant to regularise the overdraft account. As the appellant-complainant was unable to regularise the overdraft account, the erstwhile Bank, vide letter dated 14^th September, 2001, called upon the appellant-complainant to pay a sum of Rs.600.61 lakhs along with interest thereon.

7. It is the case of the appellant-complainant that though he had advised the erstwhile Bank to sell the pledged shares in December, 2001, so as to close overdraft account, the erstwhile Bank chose not to sell the said shares at that point of time. It is the case of the appellant-complainant that the said shares were sold by the erstwhile Bank in November 2002, when the market value of the said pledged shares was at the lowest, which resulted in huge loss to the appellant-complainant.

8. After selling a part of the pledged shares for a sum of Rs. 2,69,66,215.79, the respondent Bank, the successor-in-interest of the erstwhile Bank, filed a Recovery Petition before the Debts Recovery Tribunal, Mumbai against the appellant-complainant for recovery of the balance amount due as on 26^th December, 2002. The said petition was decreed by the Debts Recovery Tribunal, Mumbai, vide order dated 26^th May, 2004. However, the matter was settled between the parties and a ‘One Time Settlement’ (“OTS” for short) was reached between them on payment of Rs. 2 crore. As such, the respondent-Bank issued a ‘No Dues Certificate’ dated 14^thMay, 2005, certifying that no dues were left outstanding against the overdraft account of the appellant. After the OTS, the respondent-Bank withdrew the recovery proceedings filed against the appellant.

9. It is the case of the appellant that since the respondent-Bank failed to return the said shares to the appellant, he sent a notice on 14^th June, 2005 to the respondent-Bank, seeking release of the said shares.

10. It appears that the appellant was also working as a stock-broker of the respondent-Bank. With regard to the transactions with the appellant in the capacity as a stockbroker, the respondent-Bank had initiated arbitration proceedings against the appellant before the Arbitration forum of the Bombay Stock Exchange (‘BSE” for short). According to the appellant, the respondent-Bank failed in the said arbitration proceedings, which have attained finality.

11. In this background, the appellant filed a complaint before the Commission, alleging deficiency in services on the part of the respondent-Bank. The main relief claimed in the said complaint was for a direction to the respondent-Bank to return 3,75,000 shares of ITC Ltd. (earlier 37,50,000 shares of Ansal Hotel Ltd.) along with dividend and all accretions thereon.

12. In the said proceedings, on being served with the notice, the respondent-Bank raised a preliminary objection with regard to maintainability of the said complaint, on the ground that the appellant-complainant was not a consumer as envisaged under Section 2(1)(d) of the said Act. The Commission, by the impugned order, held that the appellant had availed the services of the respondent-Bank for ‘commercial purpose’ and as such, he was not a consumer as envisaged under Section 2(1)(d) of the said Act.

13. Being aggrieved thereby, the appellant-complainant has approached this Court by way of the present appeal.

14. We have heard Shri Shyam Divan, learned Senior Counsel appearing on behalf of the appellant and Shri Dushyant Dave, learned Senior Counsel appearing on behalf of the respondent.

15. Shri Shyam Divan, learned Senior Counsel appearing on behalf of the appellant-complainant, submitted that the appellant had a dual relationship with the respondent-Bank. In the first capacity, as a consumer, he had taken the overdraft facility from the respondent-Bank for the purposes of his self-employment. In the second capacity, he was working as the stock-broker for the respondent-Bank. The learned Senior Counsel submitted that with regard to the said relationship, though there were certain disputes, the claim of the respondent-Bank before the Arbitration Forum of BSE has been rejected by the BSE Arbitral Tribunal, which has attained finality.

16. Shri Divan further submits that it is undisputed that the said shares were pledged with the respondent-Bank only as a security towards the overdraft facility. He submits that from the letter of the respondent-Bank dated 14^th May, 2005, it is clear that there were no dues outstanding in the overdraft account of the appellant-complainant, which stood fully and finally settled through compromise/OTS. He submitted that once the dues of the respondent-Bank towards the said overdraft facility stood cleared, there was no reason for the respondent-Bank to have withheld the said shares. He submitted that though the arbitration proceedings between the parties had reached finality, the respondent-Bank had illegally withheld the said shares of the appellant. He submitted that in spite of repeated requests for return of the said shares, the same were not returned and as such, the appellant had no option but to file the complaint under the said Act.

17. Shri Divan submitted that though Section 2(1)(d)(ii) of the said Act, excludes a person who avails of such services for ‘any commercial purpose’, the Explanation thereto, which could be construed as proviso to proviso, would include even such a person if it is shown that the services availed by him were exclusively for the purposes of earning his livelihood by means of self-employment. He submitted that the services of the overdraft facility were taken by the appellant from the respondent-Bank for the purposes of his business as a stockbroker. He submitted that since the appellant was engaged in the profession of stock-broker and since the services of the said overdraft facility were taken for the appellant’s profession as a stock-broker, the services rendered by the respondent-Bank were exclusively for the purposes of earning his livelihood. Learned Senior Counsel submits that the appellant was self-employed as a stock-broker and as such, the services availed were exclusively for the purpose of earning his livelihood by means of self-employment. He relies on the dictionary meaning of the word livelihood’ as provided in Black’s Law Dictionary, Ninth Edition. He submits that the Commission has grossly erred in giving restricted meaning to the term ‘earning his livelihood by means of self-employment’. Learned Senior Counsel submits that merely because a person has availed the services of the Bank for expanding his business, that cannot be a ground to give a restricted meaning to the said term. Relying on the judgment of this Court in the case of Internet and Mobile Association of India vs. Reserve Bank of India, (2020) 10 SCC 274, he submits that the services of the Bank provide lifeline for any business, trade or profession. He submits that in the present era, it is unable for any person to survive without availing the services of a Bank. Learned Senior Counsel submits that the Commission has erred in holding that the appellant is not a consumer within the meaning of Section 2(1)(d)(ii) of the said Act. In support of his submissions, he relied on the following judgments of this Court:

(i) Lilavati Kirtilal Mehta Medical Trust vs. Unique Shanti Developers and others, (2020) 2 SCC 265;

(ii) Paramount Digital Colour Lab and others vs. AGFA India Private Limited and others, (2018) 14 SCC 81;

(iii) Sunil Kohli and another vs. Purearth Infrastructure Limited, (2020) 12 SCC 235;

(iv) CBI, AHD, Patna vs. Braj Bhushan Prasad and others, (2001) 9 SCC 432.

18. Shri Dushyant Dave, learned Senior Counsel appearing on behalf of the respondent-Bank, on the contrary, submits that the said Act is a special statute enacted with the purpose of providing a speedy and simple redressal to consumer disputes. Shri Dave submits that the said Act provides a summary procedure so that the consumer disputes are settled without undue delay. He submitted that if the definition of the word ‘consumer’ is expanded, so as to include in it a person who avails of such services for any commercial purpose, the very purpose of the said Act would be defeated. He submits that if any commercial dispute between the service provider and the availer/recipient of the service is included in the definition of the word ‘consumer’, it will give rise to floodgates of complaints. It is submitted that if such an interpretation is accepted, apart from the same being inconsistent with the provisions of Section 2(1)(d)(ii) of the said Act, it will defeat the very purpose of providing speedy justice to the consumers. He, therefore, submits that no interference is warranted in the finding of the Commission and the appeal deserves to be dismissed.

19. For appreciating the rival submissions, it will be necessary to refer to Section 2(1)(d) of the said Act, as it exists today, which is as follows:

“2. Definition.- (1) In this Act, unless the context otherwise requires,-

(a)……………………………………………………

(d) “consumer” means any person who,-

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purpose;

Explanation.For the purposes of this clause, “commercial purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment;”

20. The short question, therefore, that would have to be answered in the present case is, as to whether the services availed by the appellant from the respondent-Bank would fall within the term ‘commercial purpose’. The other question that would also have to be answered is, as to whether such services are exclusively availed by the appellant for the purposes of earning his livelihood by means of self-employment.

21. For considering the said issues, we will also have to examine the object while enacting the said Act as well as the legislative history as to how Section 2(1)(d) has come in its present form. The legislature found that though there were various provisions contained in various enactments to protect the consumers and provide relief to them, yet it became necessary to protect the consumers from the exploitation and to save them from adulterated and sub-standard goods and services and to safe guard the interests of the consumers. In order to provide for better protection of the interests of the consumer, the Consumer Protection Bill was introduced in the Parliament.

22. Perusal of the ‘Statement of Objects and Reasons’ of the said Act would show that the said Act seeks to provide for better protection of the interests of consumers and for that purpose, to make provision for the establishment of Consumer Councils and other authorities for the settlement of consumer disputes and for matters connected therewith. One of the objects for enacting the said Act was the right to be heard and to be assured that consumers’ interests will receive due consideration at appropriate forums. To provide speedy and simple redressal to consumer disputes, a quasi-judicial machinery was sought to be set up at the district, State and Central levels. It will be apposite to refer to the preamble of the said Act, which reads thus:

“An Act to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumers’ disputes and for matters connected therewith.”

23. The definition of the term ‘consumer’ as contained in Section 2(1)(d) of the said Act, as it existed in the original enactment of 1986, reads thus:

“(d) “consumer” means any person who,

(ii) hires any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person”

24. It could thus be seen that Section 2(1)(d) of the said Act is in two parts. Section 2(1)(d)(i) of the said Act deals with buying of goods. A person who buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment would be a consumer within the meaning of Section 2(1)(d)(i) of the said Act. It also includes any user of such goods other than the person who buys such goods for a consideration, which has been paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person. However, Section 2(1)(d)(i) of the said Act excludes a person who obtains such goods for resale or for any commercial purpose.

25. Section 2(1)(d)(ii) of the said Act is with respect to hiring of services. According to it, the term ‘consumer’ means any person who hires any services for a consideration, which has been paid or promised or partly paid and partly promised, or under any system of deferred payment. It also included any beneficiary of such services other than the person who hires the services as is provided under Section 2(1)(d)(i) of the said Act.

26. It could thus be seen that as per the definition of the term ‘consumer’, under Section 2(1)(d)(ii) of the said Act, as enacted originally, even if a person who hires any services for any commercial purpose, he could still be included in the definition of the term ‘consumer’. It is relevant to note that Section 2(1)(d)(i) of the said Act clearly kept a person who obtains such goods for resale or for any commercial purpose, out of the ambit of definition of the term ‘consumer’. However, insofar as hiring of services is concerned, no such provision was made in the original enactment.

27. The legislature noticed various deficiencies and inadequacies in the said Act. Therefore, in order to plug these loopholes and enlarge the scope of areas covered, the legislature brought certain amendments to the said Act by the Consumer Protection (Amendment) Act, 1993 (hereinafter referred to as “1993 Amendment Act”). One of the objects of the said Act was to enable the consumers, who are self-employed, to file complaints before the redressal agencies, where goods bought by them exclusively for earning their livelihood, suffer from any defect. By sub-section (5) of Section 2 of the 1993 Amendment Act, the following amendments were effected to the definition of the term ‘consumer’:

“(5) in clause (d),-

(A) in sub-clause (ii), for the word “hires”, in both the places where it occurs, the words “hires or avails of shall be substituted;

(B) after sub-clause (ii), the following Explanation shall be inserted at the end, namely:-

‘Explanation.- For the purposes of sub-clause (i), “commercial purpose” does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment’;”

28. It could thus be seen that by the 1993 Amendment Act, insofar as services are concerned, wherever the word “hires” was used, the same was substituted by the words “hires or avails of”. By the said 1993 Amendment Act, insofar as Section 2(1)(d)(i) is concerned, an Explanation was provided to the effect that ‘commercial purpose’ does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood by means of self-employment. It could thus be seen that though the original Act of 1986 excluded a person from the ambit of definition of the term ‘consumer’ whenever such purchases were made for commercial purpose; by the Explanation, which is an exception to an exception, even if a person made purchases for ‘commercial purpose’, he was included in the definition of the term ‘consumer’, if such a person bought and used such goods exclusively for earning his livelihood by means of self-employment. The legislative intent is clear, that though the purchases for commercial purposes are out of the ambit of the definition of the term ‘consumer’ in the said Act, if a person buys and uses such goods exclusively for earning his livelihood by way of self-employment, he would still be entitled to protection under the said Act.

29. The legislature further noticed several bottlenecks and shortcomings in the implementation of various provisions of the said Act and with a view to achieve quicker disposal of consumer complaints, and to make the said Act more effective by removing various lacunae, the legislature amended the said Act by the Consumer Protection (Amendment) Act, 2002 (hereinafter referred to as “the 2002 Amendment Act”). One of the objects for bringing out the 2002 Amendment Act was “exclusion of services availed for commercial purposes from the purview of the consumer disputes redressal agencies”. It could thus be seen that the legislature noticed the mischief, that though Section 2(1)(d)(i) of the said Act kept out of its purview the goods purchased for commercial purpose, the said restriction was not found in Section 2(1)(d)(ii) of the said Act. As such, in order to bring Section 2(1)(d)(ii) at par with Section 2(1)(d)(i), the following amendment was effected to in clause (d):

“(c) in clause (d),-

(i) in sub-clause (ii), the following words shall be inserted at the end, namely:-

“but does not include a person who avails of such services for any commercial purpose”;

(ii) for the Explanation, the following Explanation shall be substituted, namely:-

‘Explanation.For the purposes of this clause, “commercial purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment’;”

30. It could thus be seen that by the 2002 Amendment Act, the legislature clearly provided that a person, who avails of such services for any commercial purpose would be beyond the ambit of definition of the term ‘consumer’. The Explanation, which is an exception to an exception, which earlier excluded a person from the term ‘commercial purpose’, if goods were purchased by such a person for the purposes of earning his livelihood by means of self-employment, was substituted and the Explanation was made applicable to both clauses (i) and (ii). It can thus clearly be seen that by the 2002 Amendment Act, though the legislature provided that whenever a person avails of services for commercial purposes, he would not be a consumer; it further clarified that the ‘commercial purpose’ does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment.

31. It is thus clear that by the 2002 Amendment Act, the legislature has done two things. Firstly, it has kept the commercial transactions, insofar as the services are concerned, beyond the ambit of the term ‘consumer’ and brought it in parity with Section 2(1)(d)(i), wherein a person, who bought such goods for resale or for any commercial purpose, was already out of the ambit of the term ‘consumer’. The second thing that the legislature did was that even if a person availed of the commercial services, if the services availed by him were exclusively for the purposes of earning his livelihood by means of self-employment, he would still be a ‘consumer’ for the purposes of the said Act. Thus, a person who availed of services for commercial purpose exclusively for the purposes of earning his livelihood by means of self-employment was kept out of the term ‘commercial purpose’ and brought into the ambit of ‘consumer’, by bringing him on par with similarly circumstanced person, who bought and used goods exclusively for the purposes of earning his livelihood by means of self-employment. It could thus be seen that the legislature’s intent is clear. If a person buys goods for commercial purpose or avails services for commercial purpose, though ordinarily, he would have been out of the ambit of the term ‘consumer’, by virtue of Explanation, which is now common to both Sections 2(1)(d)(i) and 2(1)(d)(ii), he would still come within the ambit of the term ‘consumer’, if purchase of such goods or availing of such services was exclusively for the purposes of earning his livelihood by means of self-employment. With this legislative history in background, we will have to consider the present case.

32. The purpose of the said Act has been succinctly described by this Court in the case of Laxmi Engineering Works vs. P.S.G. Industrial Institute, (1995) 3 SCC 583, which is as under:

“10. A review of the provisions of the Act discloses that the quasi-judicial bodies/authorities/agencies created by the Act known as District Forums, State Commissions and the National Commission are not courts though invested with some of the powers of a civil court. They are quasi-judicial tribunals brought into existence to render inexpensive and speedy remedies to consumers. It is equally clear that these forums/commissions were not supposed to supplant but supplement the existing judicial system. The idea was to provide an additional forum providing inexpensive and speedy resolution of disputes arising between consumers and suppliers of goods and services. The forum so created is uninhibited by the requirement of court fee or the formal procedures of a court. Any consumer can go and file a complaint. Complaint need not necessarily be filed by the complainant himself; any recognized consumers’ association can espouse his cause. Where a large number of consumers have a similar complaint, one or more can file a complaint on behalf of all. Even the Central Government and State Governments can act on his/their behalf. The idea was to help the consumers get justice and fair treatment in the matter of goods and services purchased and availed by them in a market dominated by large trading and manufacturing bodies. Indeed, the entire Act revolves round the consumer and is designed to protect his interest. The Act provides for “business-to-consumer” disputes and not for “business-to-business” disputes. This scheme of the Act, in our opinion, is relevant to and helps in interpreting the words that fall for consideration in this appeal.”

33. It could thus be seen that this Court has clearly held that the idea of enacting the said Act was to help the consumers get justice and fair treatment in the matter of goods and services purchased and availed by them in a market dominated by large trading and manufacturing bodies. It has been held that the entire Act revolves round the consumer and is designed to protect his interest. It provides for “business-to-consumer” disputes and not for “business-to-business” disputes. It has been held that forums/commissions provided by the said Act are not supposed to supplant but supplement the existing judicial system. The idea was to provide an additional forum providing inexpensive and speedy resolution of disputes arising between consumers and suppliers of goods and services.

34. In the case of Laxmi Engineering Works (supra), this Court, while considering the scope of the definition of the expression ‘consumer’ with relation to Section 2(1)(d)(i) of the said Act and the Explanation added by 1993 Amendment Act, observed thus:

“11. Now coming back to the definition of the expression ‘consumer’ in Section 2(d), a consumer means insofar as is relevant for the purpose of this appeal, (i) a person who buys any goods for consideration; it is immaterial whether the consideration is paid or promised, or partly paid and partly promised, or whether the payment of consideration is deferred; (ii) a person who uses such goods with the approval of the person who buys such goods for consideration; (iii) but does not include a person who buys such goods for resale or for any commercial purpose. The expression ‘resale’ is clear enough. Controversy has, however, arisen with respect to meaning of the expression “commercial purpose”. It is also not defined in the Act. In the absence of a definition, we have to go by its ordinary meaning. ‘Commercial’ denotes “pertaining to commerce” (Chamber’s Twentieth Century Dictionary); it means “connected with, or engaged in commerce; mercantile; having profit as the main aim” (Collins English Dictionary) whereas the word ‘commerce’ means “financial transactions especially buying and selling of merchandise, on a large scale” (Concise Oxford Dictionary). The National Commission appears to have been taking a consistent view that where a person purchases goods “with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit” he will not be a ‘consumer’ within the meaning of Section 2(d)(i) of the Act. Broadly affirming the said view and more particularly with a view to obviate any confusion the expression “large scale” is not a very precise expression Parliament stepped in and added the explanation to Section 2(d)(i) by Ordinance/Amendment Act, 1993. The explanation excludes certain purposes from the purview of the expression “commercial purpose” a case of exception to an exception. Let us elaborate:

a person who buys a typewriter or a car and uses them for his personal use is certainly a consumer but a person who buys a typewriter or a car for typing others’ work for consideration or for plying the car as a taxi can be said to be using the typewriter/car for a commercial purpose. The explanation however clarifies that in certain situations, purchase of goods for “commercial purpose” would not yet take the purchaser out of the definition of expression ‘consumer’. If the commercial use is by the purchaser himself for the purpose of earning his livelihood by means of self-employment, such purchaser of goods is yet a ‘consumer’. In the illustration given above, if the purchaser himself works on typewriter or plies the car as a taxi himself, he does not cease to be a consumer. In other words, if the buyer of goods uses them himself, i.e., by self-employment, for earning his livelihood, it would not be treated as a “commercial purpose” and he does not cease to be a consumer for the purposes of the Act. The explanation reduces the question, what is a “commercial purpose”, to a question of fact to be decided in the facts of each case. It is not the value of the goods that matters but the purpose to which the goods bought are put to. The several words employed in the explanation, viz., “uses them by himself”, “exclusively for the purpose of earning his livelihood” and “by means of self-employment” make the intention of Parliament abundantly clear, that the goods bought must be used by the buyer himself, by employing himself for earning his livelihood. A few more illustrations would serve to emphasise what we say. A person who purchases an auto-rickshaw to ply it himself on hire for earning his livelihood would be a consumer. Similarly, a purchaser of a truck who purchases it for plying it as a public carrier by himself would be a consumer. A person who purchases a lathe machine or other machine to operate it himself for earning his livelihood would be a consumer. (In the above illustrations, if such buyer takes the assistance of one or two persons to assist/help him in operating the vehicle or machinery, he does not cease to be a consumer.) As against this a person who purchases an auto-rickshaw, a car or a lathe machine or other machine to be plied or operated exclusively by another person would not be a consumer. This is the necessary limitation flowing from the expressions “used by him”, and “by means of self-employment” in the explanation. The ambiguity in the meaning of the words “for the purpose of earning his livelihood” is explained and clarified by the other two sets of words.” [Emphasis supplied]

35. It can thus be seen that this Court observed that the National Commission was taking a consistent view that where a person purchases goods “with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit” he will not be a ‘consumer’ within the meaning of Section 2(d)(i) of the Act. This Court observed that in order to obviate any confusion that the expression “large scale” was not a very precise expression, the Parliament stepped in and added the explanation to Section 2(d)(i) by Ordinance/Amendment Act, 1993. It has been held that that the explanation excludes certain purposes from the purview of the expression “commercial purpose”. Various examples have been given by this Court as to what would come within the term of ‘self-employment’.

36. One instance given is that a person who purchases a typewriter and works on the typewriter himself, the purchase would be for the purposes of earning his livelihood by means of self-employment and he would not cease to be a ‘consumer’ for the purposes of the said Act. Another example given is that, if a person who purchases an auto-rickshaw to ply it himself on hire for earning his livelihood, he would still be a consumer too. This Court held that the question as to whether the transaction is for the ‘commercial purpose’ or for ‘earning his livelihood by means of self-employment’ is a question of fact that has to be decided in the facts of each case. It has been held that it is not the value of the goods that matters but the purpose to which the goods so bought, are put to. It has been held that several words used in the explanation, viz., “uses them by himself”, “exclusively for the purpose of earning his livelihood” and “by means of self-employment” make the intention of the Parliament abundantly clear, that the goods bought must be used by the buyer himself, for earning his livelihood.

37. In the case of Cheema Engineering Services vs. Rajan Singh, (1997) 1 SCC 131, this Court held that the manufacture and sale of bricks in a commercial way may also be to earn livelihood.

As such, the question as to whether the complainant used the machinery for the manufacture of bricks alone or with members of his family and as to whether the same was for earning his livelihood, were the questions of fact to be decided on the basis of evidence.

38. In the case of Kalpavruksha Charitable Trust vs. Toshniwal Brothers (Bombay) Pvt. Ltd. and another, (2000) 1 SCC 512, this Court considered the question as to whether the machines purchased by the Charitable Trust for use in the Diagnostic Centre were meant for ‘commercial purpose’ or not. It was sought to be urged on behalf of the Trust that the Trust was not carrying out a profit-making activity and as such, the purchase of diagnostic machines would not come within the ambit of the term ‘commercial purpose’. It was, therefore, sought to be urged that it would fall within the definition of the term ‘consumer’. This Court held that the finding of the National Commission that the machinery was installed for commercial purpose and as such, the Trust was not a ‘consumer’ within the meaning of the said Act, required no interference.

39. In the case of Paramount Digital Colour Lab (supra), this Court was considering the case of unemployed graduates, who had started a business of photography in partnership for self-employment and for their livelihood. For the said purpose, they had purchased an advanced photo processing, developing and printing machine. It was the case of the appellants therein that the respondents, despite having the knowledge that the machine was not working properly, had unfairly and carelessly sold the same to the appellants. As such, the appellants were required to file a complaint under the said Act. The State Commission had allowed the complaint. In appeal, the National Commission held that the appellants were not the consumers as envisaged under Section 2(1)(d) of the said Act, since the purchase of the machine was for commercial purpose. Reversing the view taken by the National Commission and upholding the view taken by the State Commission, this Court observed thus:

“12. In this case, since the appellants have purchased the machine, Section 2(1)(d) of the Act is applicable. “Consumer” as defined under Section 2(1)(d) of the Act does not include a person who obtains goods for a “commercial purpose”. The Explanation supplied to Section 2(1)(d) clarifies that “commercial purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of “self-employment”. If both these provisions are read together, it leads to the conclusion that if a person purchased the goods for consideration not for any commercial purpose, but exclusively for the purposes of earning his livelihood by means of “self-employment”, such purchaser will come within the definition of “consumer”. If a person purchases the goods for a “commercial purpose” and not for the purposes of earning his livelihood by means of “self-employment”, such purchaser will not come within the definition of “consumer”. It is therefore clear, that despite “commercial activity”, whether a person would fall within the definition of “consumer” or not would be a question of fact in every case. Such question of fact ought to be decided in the facts and circumstances of each case.

13. “Self-employment” necessarily includes earning for self. Without earning generally there cannot be “self-employment”. Thus, if a person buys and uses the machine exclusively for the purposes of earning his livelihood by means of “self-employment”, he definitely comes within the definition of “consumer”. In the matter on hand, the quality of ultimate production by the user of the machine would depend upon the skill of the person who uses the machine. In case of exigencies, if a person trains another person to operate the machine so as to produce the final product based on skill and effort in the matter of photography and development, the same cannot take such person out of the definition of “consumer”.”

40. This Court, on facts in the said case, found that the appellants therein were unemployed graduates and had bought the said machine for their own utility, personal handling and for their small venture, which they had embarked upon to make a livelihood. This Court further found that this was distinct from large-scale manufacturing or processing activity carried on for huge profits. It was, therefore, held that the appellants therein would be consumers within the meaning of Section 2(1)(d) of the said Act.

41. Shri Shyam Divan, learned Senior Counsel appearing on behalf of the appellant, strongly relied on the judgment of this Court in the case of Lilavati Kirtilal Mehta Medical Trust (supra), wherein this Court after considering the earlier judgments held thus:

“19. To summarise from the above discussion, though a strait jacket formula cannot be adopted in every case, the following broad principles can be culled out for determining whether an activity or transaction is “for a commercial purpose”:

19.1. The question of whether a transaction is for a commercial purpose would depend upon the facts and circumstances of each case. However, ordinarily, “commercial purpose” is understood to include manufacturing/industrial activity or business-to-business transactions between commercial entities.

19.2. The purchase of the good or service should have a close and direct nexus with a profit-generating activity.

19.3. The identity of the person making the purchase or the value of the transaction is not conclusive to the question of whether it is for a commercial purpose. It has to be seen whether the dominant intention or dominant purpose for the transaction was to facilitate some kind of profit generation for the purchaser and/or their beneficiary.

19.4. If it is found that the dominant purpose behind purchasing the good or service was for the personal use and consumption of the purchaser and/or their beneficiary, or is otherwise not linked to any commercial activity, the question of whether such a purchase was for the purpose of “generating livelihood by means of self-employment” need not be looked into.”

42. It is thus clear, that this Court has held that the question, as to whether a transaction is for a commercial purpose would depend upon the facts and circumstances of each case. However, ordinarily, “commercial purpose” is understood to include manufacturing/industrial activity or business-to-business transactions between commercial entities; that the purchase of the good or service should have a close and direct nexus with a profit-generating activity; that the identity of the person making the purchase or the value of the transaction is not conclusive for determining the question as to whether it is for a commercial purpose or not. What is relevant is the dominant intention or dominant purpose for the transaction and as to whether the same was to facilitate some kind of profit generation for the purchaser and/or their beneficiary. It has further been held that if the dominant purpose behind purchasing the good or service was for the personal use and the consumption of the purchaser and/or their beneficiary, or is otherwise not linked to any commercial activity, then the question of whether such a purchase was for the purpose of “generating livelihood by means of self-employment” need not be looked into.

43. On facts, it was held that the purchase of flats by the appellant therein had no direct nexus with the profit generating activities. The flats were not occupied for undertaking any medical/diagnostic facilities within the hospital but for accommodating the nurses employed by the hospital. It was further held that the flats are being provided to the nurses without any rent and that the appellant therein was not generating any surplus from occupying the flats or engaging in buying and selling of flats.

44. Insofar as the judgment of this Court in the case of Sunil Kohli (supra), relied upon by the appellant, is concerned, this Court on the basis of the evidence, clearly found that the complainants wanted to dispose of property in Denmark and wanted to come down to Delhi to start a business. It has further been found that for this purpose, the premises in question were booked. As such, the said case was a case wherein the commercial premises were booked by the appellants therein, who had left their employment in Denmark and purchased the premises only for the purposes of starting their business for earning their livelihood by way of self-employment. Therefore, the said case was a case wherein the appellants therein had availed of the services exclusively for earning their livelihood by means of self-employment.

45. It could thus be seen, that when a person avails a service for a commercial purpose, to come within the meaning of ‘consumer’ as defined in the said Act, he will have to establish that the services were availed exclusively for the purposes of earning his livelihood by means of self-employment. There cannot be any straitjacket formula and such a question will have to be decided in the facts of each case, depending upon the evidence placed on record.

46. In the present matter, it is not in dispute that the appellant was already engaged in the profession of stockbroker, much before he availed of service of the overdraft facility from the respondent-Bank. It is also not in dispute that he was also acting as a stock-broker for the respondent-Bank. It is also not in dispute that the appellant took the overdraft facility and also sought enhancement of the same from time to time in furtherance of his business as a stockbroker and for the purpose of enhancing the profits therein.

As already held by this Court in the case of Laxmi Engineering Works (supra), the terms “services availed by him”, “exclusively for the purpose of earning his livelihood” and “by means of self-employment” will have to be given its meaning, as intended by the legislature. The said terms will have to be construed in context with the purpose for which the said Act is enacted. We have elaborately discussed the legislative history as to how Section 2(1)(d) of the said Act has come in its present form from the original form. The amendments incorporated by the 1993 Amendment Act as well as by the 2002 Amendment Act would clearly show that the legislative intent is to keep the commercial transactions out of the purview of the said Act and at the same time, to give benefit of the said Act to a person who enters into such commercial transactions, when he uses such goods or avails such services exclusively for the purposes of earning his livelihood by means of self-employment.

47. In the present case, the Commission has come to a finding that the appellant had opened an account with the respondent-Bank, took overdraft facility to expand his business profits, and subsequently from time to time the overdraft facility was enhanced so as to further expand his business and increase his profits. The relations between the appellant and the respondent is purely “business to business” relationship. As such, the transactions would clearly come within the ambit of ‘commercial purpose’. It cannot be said that the services were availed “exclusively for the purposes of earning his livelihood” “by means of self-employment”. If the interpretation as sought to be placed by the appellant is to be accepted, then the ‘business to business’ disputes would also have to be construed as consumer disputes, thereby defeating the very purpose of providing speedy and simple redressal to consumer disputes.

48. We, therefore, find no error with the findings of the Commission. In any case, the Commission has already granted liberty to the appellant to avail of his remedy by approaching the appropriate forum, having jurisdiction.

49. In the result, the appeal is dismissed. There shall be no order as to costs. All pending applications, if any, shall stand disposed of.

Posted on 2nd March 2022 by rajatbindal5gmailcom — Leave a comment

District Magistarte can appoint advocate to take possession of property in SERFASAI ACT.

SUPREME COURT OF INDIA

DIVISION BENCH

NKGSB COOPERATIVE BANK LIMITED — Appellant

Vs.

SUBIR CHAKRAVARTY AND OTHERS — Respondent

( Before : A.M. Khanwilkar and C.T. Ravikumar, JJ. )

Civil Appeal No……………of 2022 (@S.L.P. (Civil) No. 30240 of 2019); Civil Appeal No……………of 2022 (@ S.L.P. (Civil) No. 2055 of 2020); Civil Appeal No……………of 2022 (@ S.L.P. (Civil) No…………of 2022) (@ Diary No. 17059 of 2020); Civil Appeal No……………of 2022 (@ S.L.P. (Civil) No…………of 2022) (@ Diary No. 23733 of 2020) and S.L.P. (Civil) No. 12011 of 2020

Decided on : 25-02-2022

Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 – Section 14(1A) – Taking of Possession of Secured Assets and Documents – Power of District Magistrate (DM) or Chief Metropolitan Magistrate (CMM) to appoint an advocate and authorise him – Held, An advocate is and must be regarded as an officer of the court and subordinate to the CMM/DM for the purposes of Section 14(1A) of the 2002 Act – It is open to the District Magistrate (DM) or the Chief Metropolitan Magistrate (CMM) to appoint an advocate and authorise him/her to take possession of the secured assets and documents relating thereto and to forward the same to the secured creditor within the meaning of Section 14(1A) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002:

– Sub-Section (1A) of Section 14 of the 2002 Act is no impediment for the CMM/DM to engage services of an advocate (an officer of the court) – only for taking possession of secured assets and documents relating thereto and to forward the same to the secured creditor in furtherance of the orders passed by the CMM/DM under Section 14(1) of the 2002 Act in that regard – It does not follow that the advocate so appointed needs to be on the rolls in the Office of the CMM/DM or in public service – There is intrinsic de jure functional subordinate relationship between the CMM/DM and the advocate being an officer of the court – Apprehension of the borrowers about improper execution of orders of the CMM/DM passed under Section 14(1) of the 2002 Act by the Advocate Commissioner, is plainly misplaced. Further, being an officer of the court and appointed by the CMM/DM, the acts done by the Advocate Commissioner would receive immunity under Section 14(3) of the 2002 Act – as an officer authorised by the CMM/DM. There is no reason to assume that the advocate so appointed by the CMM/DM would misuse the task entrusted to him/her and that will not be carried out strictly as per law or it would be a case of abuse of power – Rather, going by the institutional faith or trust reposed on advocates being officers of the court, there must be a presumption that if an advocate is appointed as commissioner for execution of the orders passed by the CMM/DM under Section 14(1) of the 2002 Act, that responsibility and duty will be discharged honestly and in accordance with rules of law.

Counsel for Appearing Parties

Mr. Viraj Kadam, Advocate, Mr. Soumya Dutta, Advocate, Mr. Devendra Kumar Singh, Advocate, Mr. Karunakar Mahalik, Advocate, Mr. Gouranga Biswal, Advocate, Mr. Manoranjan Mishra, Advocate, Mr. B. Raghunath, Advocate, Mr. Sriram P., Advocate on Record Ms. Kavitha M.C., Advocate Ms. Muskaan Garg, Advocate Ms. Prerna Robin, Advocate Mr. Sreenath S., Advocate Mr. Mukund P. Unni, Advocate, Mr. Sriram P., Advocate, Ms. Daisy Hannah, Advocate, Mr. Manish Shanker Srivastava, Advocate, Ms. Kalpana, Advocate, Ms. Pallavi Baghel, Advocate, Mr. Abhishek Kumar Singh, Advocate, for the Appellant; Mr. M.L. Ganesh, Advocate, Mr. K. V. Vijayakumar, Advocate, Mr. Rana Mukherjee, Sr. Advocate, Ms. Daisy Hannah, Advocate, Ms. Kanika Sharma, Advocate, Ms. Surabhi Guleria, Advocate, Ms. Oindrila Sen, Advocate, Mr. Rahul Chitnis, Advocate, Mr. Sachin Patil, Advocate,. Mr. Aaditya A. Pande, Advocate, Mr. Geo Joseph, Advocate, Ms. Shwetal Shepal, Advocate, for the Respondent.

Cases Referred

M/s. J. Marks Exim (India) Pvt. Ltd. vs. Punjab National Bank, 2017 SCC OnLine Bom 2246
A. St. Arunachalam Pillai vs. M/s. Southern Roadways Ltd. & Anr., AIR 1960 SC 1191
Authorised Officer, Indian Bank vs. D. Visalakshi & Anr., (2019) 20 SCC 47
B. Veeraswamy & Ors. vs. State of Andhra Pradesh & Ors., AIR 1959 AP 413
Dattatraya Moreshwar vs. The State of Bombay & Ors., AIR 1952 SC 181
Dipak Babaria & Anr. vs. State of Gujarat & Ors., (2014) 3 SCC 502
Doherty v. King, Tex. Civ.App., 183 S.W.2d 1004
Donohue v. Zoning Bd. of Appeals of Town of Norwalk, 155 Conn. 550, 235 A. 2d 643, 646
Govt. of A.P. v N. Ramanaiah, (2009) 7 SCC 165,
Gurmukh Singh v UOI, New Delhi, MLJ : QD (1961-1965) Vol. 11 C1050 : 65 Punj LR 964 : AIR 1963 P&H 370
Krishna Swamy Mudaliar v Palani Pillai, MLJ : QD (1956-1960) Vol. IV C151 : (S) AIR 1957 Mad 599
Lalit Mohan Das vs. The Advocate-General, Orissa & Anr., AIR 1957 SC 250
Laxminarayana Sarangi v State of Orissa, MLJ : QD (1961-1965) Vol. II C1050 : AIR 1963 Orissa8 : ILR (1962) Cut 492
M/s. Hiralal Rattanlal etc. etc. vs. State of U.P. & Anr. etc. etc., (1973) 1 SCC 216
Mahadev Govind Gharge & Ors. vs. Special Land Acquisition Officer, Upper Krishna Project, Jamkhandi, Karnataka, (2011)6 SCC 321
Mahadev Prasad Roy v. S.N. Chatterjee, AIR 1954 Pat 285
Muhammed Ashraf & Anr. vs. Union of India & Ors., AIR 2009 Kerala 14
O.P. Sharma & Ors. vs. High Court of Punjab & Haryana(2011) 6 SCC 86
R.G. Jacob v Republic of India, AIR 1963 SC 550
Raghunath Sahai v Sarup Singh, MLJ : QD (1961-1965)
Rahul Chaudhary vs. Andhra Bank & Ors., 2020 SCC OnLine Del 284
Ram Narain v Director of Consolidation, AIR 1965 All 172
S. Chandramohan & Anr. vs. The Chief Metropolitan Magistrate, Egmore, Chennai & Ors., 2014-5-L.W. 620: 2014 SCC OnLine Mad 7869
S. Krishnaswamy Mudaliar & Anr. vs. P.S. Palani Pillai & Anr., AIR 1957 Mad 599
Sakiri Vasu vs. State of Uttar Pradesh & Ors., (2008) 2 SCC 409
Sangram Singh vs. Election Tribunal, Kotah & Anr., AIR 1955 SC 425
Satheedevi vs. Prasanna & Anr., (2010) 5 SCC 622
Shiv Bahadur Singh v State of Uttar Pradesh, AIR 1953 SC 394
Slegel v. Slegel, 135 N.J. Eq. 5, 37 A.2d 57
The Federal Bank Ltd., Ernakulam vs. A. V. Punnus, AIR 2014 Kerala 7
V.S. Sunitha vs. Federal Bank Ltd., 2018 SCC OnLine Ker 12866

JUDGMENT

A.M. Khanwilkar, J. – The seminal question involved in these cases is: whether it is

open to the District Magistrate[1] or the Chief Metropolitan Magistrate[2] to appoint an advocate and authorise him/her to take possession of the secured assets and documents relating thereto and to forward the same to the secured creditor within the meaning of Section 14(1 A) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002[3]?

[1] for short, “DM”

[2] for short, “CMM”

[3]for short, “2002 Act”

2. The High Court of Judicature at Bombay[4] vide judgment and order dated 6.11.2019 in Writ Petition (L) No. 28480 of 2019 opined that the advocate, not being a subordinate officer to the CMM or DM, such appointment would be illegal. Against this decision, four separate appeals[5]have been filed by the concerned parties. On the other hand, the High Court of Judicature at Madras[6] vide judgment and order dated 18.3.2020 in C.R.P. No. 790 of 2020 has taken a contrary view while following earlier decision of the same High Court on the reasoning that the advocate is regarded as an officer of the court and, thus, subordinate to the CMM or the DM. Having so held, it allowed the civil revision petition filed by the secured creditor (Canara Bank). Against this decision, a special leave petition[7] has been filed by the borrowers.

[4] for short, “Bombay High Court”

[5]Civil Appeal No….. of 2022 @ SLP (Civil) No. 30240 of 2019; Civil Appeal No….. of 2022 @ SLP (Civil) No. 2055 of 2020; Civil Appeal No…..of 2022 @ SLP (Civil) No……of 2022 @ Diary No. 17059 of 2020; and Civil Appeal No…..of 2022 @ SLP (Civil) No……of 2022 @ Diary No. 23733 of 2020

[6] for short, “Madras High Court”

[7] SLP (Civil) No. 12011 of 2020

3. The High Courts of Kerala (in Muhammed Ashraf & Anr. vs. Union of India & Ors., AIR 2009 Kerala 14; The Federal Bank Ltd., Ernakulam vs. A. V. Punnus, AIR 2014 Kerala 7; and V.S. Sunitha vs. Federal Bank Ltd., 2018 SCC OnLine Ker 12866), Madras (in S. Chandramohan & Anr. vs. The Chief Metropolitan Magistrate, Egmore, Chennai & Ors., 2014-5-L.W. 620: 2014 SCC OnLine Mad 7869) and Delhi (in Rahul Chaudhary vs. Andhra Bank & Ors., 2020 SCC OnLine Del 284), have taken the same view as in the case of Canara Bank impugned in the special leave petition[8] arising from the decision of the Madras High Court.

[8] see Footnote No. 7

4. Additionally relying on the dictum in M/s. J. Marks Exim (India) Pvt. Ltd. vs. Punjab National Bank, 2017 SCC OnLine Bom 2246 decided by the Division Bench of the Bombay High Court, it was urged that the coordinate Bench of the Bombay High Court had answered the issue under consideration in favour of the secured creditors and against the borrowers on the same lines as the view taken by other three High Courts, namely, High Courts of Kerela, Madras and Delhi. However, in the judgment of the Bombay High Court of coordinate Bench impugned before this Court, it has been observed that the dictum in the said decision had not considered the precise question that has been dealt with in the impugned judgment.

5. Briefly stated, in each of the cases under consideration, the CMM/DM appointed an advocate purportedly in exercise of powers under Section 14(1 A) of the 2002 Act. In the cases arising from the judgment of the Bombay High Court, the borrowers had urged before the High Court that the Additional Chief Metropolitan Magistrate[9], 3^rd Court, Esplanade, Mumbai on application filed by the secured creditor (Bank) under Section 14 of the 2002 Act passed an order dated 26.7.2019, appointing an advocate to take possession of the secured assets and documents relating thereto and to forward the same to the secured creditor. The order passed by the ACMM records that the Bank had advanced a loan in the sum of Rs. 4.44 crore on 31.1.2015 to the borrowers, who had mortgaged Flat No. 262, 26^th Floor, Building No. 02 with two basement car spaces in a building known as ‘Kalpataru Pinnacle’ in Goregaon (West), Mumbai. Further, the borrowers had defaulted on 30.10.2017. Their account was declared Non-Performing Asset[10]. As a sequel, on 13.11.2017, a notice under Section 13(2) of the 2002 Act was issued to them and posted by Registered Post A.D. The docket was returned with ‘intimation posted’ meaning thereby, the noticees were not available at the given address. The order further records that the Bank served the notice upon the borrowers by publication on 31.12.2017 calling upon them to pay the outstanding dues within sixty days. However, loan amount remained unpaid. As a result, the secured creditor approached the ACMM to pass appropriate directions, on which application the stated order dated 26.7.2019 came to be passed appointing an advocate. The same was communicated to the borrowers by the advocate on 11.10.2019. That order was challenged before the Bombay High Court by the borrowers by way of writ petition[11] under Article 226 of the Constitution of India, which has been decided by the High Court vide impugned judgment and order holding that Section 14(1 A) of the 2002 Act does not permit the CMM/DM to authorise an advocate.

[9] for short, “ACMM”

[10] for short, “NPA”

[11] Writ Petition (L) No. 28480 of 2019

The language used in the provision is amply clear. Such delegation could be done only to an officer subordinate and none else. The High Court rejected the argument that the overburdened CMM/DM had inadequate subordinate staff and it would be difficult, if not virtually impossible for the secured creditor to take possession of and realise the outstanding dues by disposing the secured asset. The High Court was not impressed with that argument and preferred to strictly construe the stated provision. The secured creditors have assailed this decision by way of appeals[12] before this Court.

[12] see Footnote No. 5

6. Reverting to the special leave petition[13] arising from the decision of the Madras High Court. The Bank had given loan to the borrowers upon mortgage of their property. Despite the demand to clear the outstanding dues, the loan amount remained unpaid. Resultantly, the Bank classified the account as NPA followed by notice under Section 13(2) of the 2002 Act dated 21.7.2017 to the borrowers. Eventually, the Bank took symbolic possession of the property through its authorised officer after issuing possession notice. That was published in two leading newspapers. The borrowers challenged the notice issued to them under Section 13(4) of the 2002 Act. That challenge was unsuccessful. Where after, the Bank invoked action under Section 14 of the 2002 Act by filing application before the CMM for taking possession of the secured assets. The borrowers challenged the sale notice by filing application being S.A. No. 59 of 2019. No injunction was granted in favour of the borrowers and to restrain the Bank from proceeding with the sale of the secured property. Hence, the Bank pursued the application under Section 14 of the 2002 Act before the CMM, which came to be disposed of on 6.8.2019 by appointing an Advocate Commissioner to take possession of the secured property. Thereafter, the application filed by the borrowers, being S.A. No. 59 of 2019, came to be dismissed. In the interregnum, the borrowers filed another application in S.A. No.399 of 2019, challenging the order dated 6.8.2019 passed by the CMM, appointing an Advocate Commissioner, in Crl. M.P. No. 2995 of 2019. The Debts Recovery Tribunal II[14], Chennai was pleased to allow S.A.No.399 of 2019, inter alia, holding that the procedure mandated under clauses (i) to (ix) of the proviso to Section 14(1) of the 2002 Act had not been complied with by the secured creditor (Bank) and in any case, the appointment of the Advocate Commissioner was illegal. The Tribunal allowed the challenge vide order dated 4.2.2020. That decision came to be assailed by the Bank before the Madras High Court by way of civil revision petition[15] under Article 227 of the Constitution of India. The High Court noted two issues arising for its consideration, in paragraph 9 of the impugned judgment. The first issue was regarding the correctness of the conclusion recorded by the Tribunal on the plea of non-compliance of clauses (i) to (ix) of Section 14 of the 2002 Act. That came to be set aside being manifestly erroneous (see paragraphs 10 and 11 of the impugned judgment). However, on the second issue about power of the CMM/DM to appoint an Advocate Commissioner, the High Court, amongst other, relied upon its earlier decision as well as of the High Courts of Delhi and Kerala, to conclude that the Tribunal committed manifest error, including not to take notice of the decision of the same High Court referred to in the impugned judgment. In short, the Madras High Court accepted the argument of the secured creditor (Bank) that it was open to the CMM/DM to appoint an Advocate Commissioner for taking possession of the secured assets and documents relating thereto for being forwarded to the secured creditor in terms of Section 14(1 A) of the 2002 Act. This decision has been challenged by the borrowers by way of a special leave petition[16]before this Court.

[13] see Footnote No. 7

[14] for short, “Tribunal”

[15] C.R.P. No. 790 of 2020

[16] see Footnote No. 7

7. We have heard Mr. Rana Mukherjee, learned senior counsel, Mr. Viraj Kadam, Mr. Manish Shanker Srivastava, Mr. Devendra Kumar Singh and Mr. M.L. Ganesh, learned counsel appearing for the Banks, Mr. B. Raghunath, learned counsel appearing for the borrowers and Mr. Rahul Chitnis, learned counsel appearing for the State of Maharashtra.

8. As aforesaid, the one and only question common to all these cases is: whether the CMM/DM can appoint an advocate in exercise of powers under Section 14(1 A) of the 2002 Act? This issue arises because of the expression used in the said provision, “may authorise any officer subordinate to him”.

9. The earliest decision dealing with the issue under consideration is that of the High Court of Kerala in Muhammed Ashraj[17] wherein the Division Bench of the High Court rejected the argument that mandate of Section 14 obliges the CMM/DM to go personally and take possession of the secured assets and documents relating thereto. It noted that Section 14(2) of the 2002 Act enabled the CMM/DM to pass order even to take Police assistance and use all necessary powers in taking possession of the secured assets. To buttress this view, reference has been made to the decision of this Court in Sakiri Vasu vs. State of Uttar Pradesh & Ors., (2008) 2 SCC 409 wherein the Court noted that an express grant of statutory powers carries with it by necessary implication the authority to use all reasonable means to make such grant effective. In other words, the authority had implied powers to grant relief which is not expressly granted to it by the Act. On that logic, the Division Bench of the High Court of Kerala opined that it would be open to the Magistrate who has the power under Section 14 of the 2002 Act to take possession of the secured assets including to take assistance of Police including an Advocate Commissioner so as to facilitate the secured creditor to take over the secured assets. As a result, the Magistrate could also appoint a commissioner for identification of the secured assets and taking possession thereof. This decision has attained finality owing to the dismissal of S.L.P. (Civil) No. 1671 of 2009 on 2.2.2009 by this Court. Notably, this decision was rendered before the amendment of Section 14 and in particular insertion of sub-Section (1A)[18].

[17] supra at Footnote No.8

[18] Inserted by Act 1 of 2013, sec. 6(b) (w.e.f. 15.1.2013, vide S.O. 171(E), dated 15.1.2013)

10. The aforementioned decision, however, had been followed by the learned Single Judge of the High Court of Kerala in the case of The Federal Bank Ltd., Ernakulam[19] which had arisen after the amendment of Section 14 of the 2002 Act and insertion of sub-Section (1A) therein. Despite insertion of sub-Section (1A), learned Single Judge following the judgment in Muhammed Ashraf [20], answered the issue in the following words:

“5. …It may however appear at first blush that such an Advocate Commissioner is not an officer subordinate to the District Magistrate or the Chief Judicial Magistrate. But a reference to Sections 12 and 17 of the Code of Criminal Procedure, 1973 indicates that the term District Magistrate or Chief Metropolitan Magistrate denotes the court and not the officer in person. An Advocate Commissioner is certainly an officer subordinate to the court and the words employed in Section 14 (1A) of the SARFAESI Act are not to be understood as meaning an officer subordinate in service. Section 284 of the Code of Criminal Procedure, 1973 in fact empowers an Advocate Commissioner to record the examination of witnesses whose personal appearance in court is dispensed with. Similar provisions can be found in Order XXVI Rule 17 of the Code of Civil Procedure, 1908 enabling the Advocate Commissioner to record evidence of witnesses and Section 75 (g) thereof to perform any ministerial act even. Taking over possession of the secured asset and handing over the same to the creditor bank is nothing but a ministerial act of the Advocate Commissioner on behalf of the court. The Advocate Commissioner exercising such function under Section 14 (1A) of the SARFAESI Act is only discharging his duty as an officer subordinate to the court presided by the Magistrate. The contention of the borrower that the Advocate Commissioner is not an officer subordinate in service to the Chief Judicial Magistrate and hence incompetent is only to be rejected.” (emphasis supplied)

[19] supra at Footnote No.9

[20] supra at Footnote No.8

11. Once again, another learned Single Judge of the High Court of Kerala in V.S. Sunitha [21]reiterated the same view and held that the Magistrate rendering assistance to the secured creditor is competent to appoint a commissioner to take possession of the secured assets.

[21] supra at Footnote No. 10

12. This very issue had also arisen before the Madras High Court in S. Chandramohan[22]. The Division Bench of the Madras High Court after adverting to Section 14(1 A) of the 2002 Act went on to observe as follows:

“8…..

The same is an enabling provision conferring power on the Chief Metropolitan Magistrate or District Magistrate to authorise any officer subordinate to him to take possession of the assets and documents relating thereto and forward the assets and documents to the secured creditors.

9. The Advocate Commissioners appointed by the learned Chief Metropolitan Magistrate is in tune with Section 14(1-A) of the SARFAESI Act, 2002. As per Section 14 of the Act, the secured creditors can approach the Chief Metropolitan Magistrate/ District Magistrate to take possession of the assets and documents of the secured creditor. The Chief Metropolitan Magistrate, instead of personally visiting the spot to take possession of assets and documents, can very well appoint the Advocate Commissioner to visit on his behalf, as in the case of issuing of commissions under the Civil Procedure Code, as it is not possible for the Chief Metropolitan Magistrate/ District Magistrate to visit personally to take possession.

10. The amendment inserted by Act 1 of 2013 viz., Section 14(1-A) is permitting the Subordinate Officers to do the above said acts and nowhere prohibits the Chief Metropolitan Magistrate from authorising an Advocate Commissioner to go on his behalf for taking possession of assets and documents and forwarding the same to the secured creditor. The amendment gives discretion to the Chief Metropolitan Magistrate/ District Magistrate either to authorise or take possession of such assets and document and the word used being ‘may’, it is not always necessary on the part of the Chief Metropolitan Magistrate to authorise any officer subordinate to him. It is a well settled proposition of law that the observance of the word ‘may’ used in the statute is only directory, in the sense, non-compliance with those provisions will not render the proceedings invalid. Sometimes, the word ‘shall’ may also be directory and not mandatory…..”

[22] supra at Footnote No. 11

It then adverted to the decisions of this Court in Dattatraya Moreshwar vs. The State of Bombay & Ors., AIR 1952 SC 181, Mahadev Govind Gharge & Ors. vs. Special Land Acquisition Officer, Upper Krishna Project, Jamkhandi, Karnataka, (2011)6 SCC 321 and Sangram Singh vs. Election Tribunal, Kotah & Anr., AIR 1955 SC 425 on the principles of interpretation of statute and noted thus:

“11. The object of the amendment introduced in Act 1 of 2013 being to give assistance to the Chief Metropolitan Magistrate/District Magistrate, the Chief Metropolitan Magistrate is justified in appointing Advocate Commissioners, instead of authorising Subordinate Officers to take possession. It is well settled in law that Advocates are also Officers of the Court, though not subordinate to Chief Metropolitan Magistrate. As Officers of the Court, the Advocates can perform their duty more effectively than the Officers, subordinate to the Chief Metropolitan Magistrate in taking possession of assets and documents and in delivering the same to the Secured Creditor. Thus, in any event, the contention raised by the learned counsel appearing for the petitioner is devoid of merits.” (emphasis supplied)

13. The issue also received attention of the High Court of Delhi in Rahul Chaudhary[23]. The High Court answered the issue in the following words:

“3.1 To be noted, the receiver has been appointed by the learned CMM vide order dated 05.12.2019.

4. The learned CMM has appointed an advocate to take possession of the secured asset.

5. Counsel for the petitioner does not dispute that fact that the receiver appointed by the learned CMM has taken possession of the subject secured asset on 16.01.2020.

6. It is, however, the say of the counsel for the petitioner that appointment of an advocate as a receiver was contrary to the provisions of Section 14 (1A) of the SARFAESI Act and, therefore, that part of the order passed by the learned CMM should be set aside as was done by the Bombay High Court in the aforementioned matter.

7. To my mind, the writ petition, in fact, has been rendered infructuous, in a sense, that the receiver would have handed over the possession of the subject asset to the secured creditor, that is, the Andhra Bank.

8. Nevertheless, according to me, the language of Section 14(1 A) of the SARFAESI Act uses the expression “may” and not “shall”.

8.1 There are two ways of appreciating the provision. First, that the expression “may” relates to the choice of the subordinate officer. The other meaning that can be placed on the provision is that District Magistrate/CMM is vested with discretion to appoint officers subordinate to him to take possession of the secured asset.

8.2 The District Magistrate/CMM is obliged to take possession once an application in that behalf is preferred under sub-section (1) of Section 14 of the SARFAESI Act by the secured creditor.

8.3 It is in the exercise of such power that recourse can be taken by the District Magistrate/CMM to the provisions of sub-section (1A) of Section 14. This provision was introduced via Act 1 of 2013. Before that the District Magistrate/CMM were perhaps taking recourse to subsection (2) of Section 14 and, thus, appointing advocates as receiver.

8.4 To my mind, after the insertion of sub-section (1A) in Section 14, the only change that has been brought about is that the District Magistrate/CMM has now the discretion to appoint even their subordinate officers as receivers.

8.5 Pertinently, sub-section (1A) of Section 14 does not bar the appointment of advocates as receivers. The same position obtains vis-a-vis Rule 8(3) of The Security Interest (Enforcement) Rules, 2002, which has been cited in the aforementioned judgment of the Bombay High Court.

9. As was noticed in Subir Chakravarty’s case[24], the District Magistrates and the CMMs are overburdened. The position is no different in Delhi.

10. Thus, in my view, since the provision vests discretion in the District Magistrate/CMM and as long the discretion is exercised with due care and caution, the appointment of advocates as receivers cannot be faulted.” (emphasis supplied)

[23]supra at Footnote No. 12

[24] see Footnote No. 17

As noticed from the extracted portion of the judgment, the High Court of Delhi disagreed with the view taken by the Bombay High Court in the impugned judgment which has been assailed in the cases under consideration.

14. Concededly, there is conflict of opinion between the three High Courts[25] on the one side and the Bombay High Court on the other. In the impugned judgment, the Bombay High Court observed as follows:

“9 The language of the legislature is clear. The District Magistrate or the Chief Metropolitan Magistrate may authorize any officer subordinate to take possession of such asset and this means that the person authorized to take possession has to be an officer subordinate to the District Magistrate or the Chief Metropolitan Magistrate.

10 The decision dated 17^th March 2017[26] passed by the Division Bench was not premised on a challenge to the authorization in favour of an Advocate to take possession of a secured asset. The observations at the end of the order are probably the result of the facts noted in the impugned order. The overburdened Metropolitan Magistrates or the District Magistrates having inadequate subordinate staff find it a handicap to deal with large number of applications under Section 14 of the SARFAESI Act, 2002, but this would be no ground to violate the language of the statute. The legislature may be requested to intervene. We propose to do that at the end of the present order.

11 …..

12 A perusal of the sub-rule[27] shows that after possession of immovable property is physically taken over by the Officer authorized custody thereof can be handed over for care and protection of the property to any person authorized or appointed by him. Thus, after possession of a secured asset is taken over, its custody can be entrusted to any person who need not be an Officer of the Court or authorized subordinate staff of the Court. This could perhaps solve half the problem faced by District Magistrates and Chief Metropolitan Magistrates.

13 The cry of anguish in paragraph No. 7 of the impugned order is also justified. Each day, at least two, if not three petitions, are filed by way of mercy pleading to this Court that some time be given to the defaulting borrower to clear the defaulting loan so that the property mortgaged can be saved. Wide and varied facts such as exams of the children are ensuing, old and aged parents, paternal or maternal aunt are suffering from an ailment and are under going treatment at a nearby hospital are pleaded. The borrower is making attempts to sell another property to clear the outstanding amounts etc. Equities are pleaded.

14 Courts in India being not only Courts of Justice but Courts of Equity, the orders passed under Section 14 are stayed, but ultimately the petitions fail.

15 Howsoever inconvenient it may be to a Court, rights of parties cannot be curtailed in the manner done in the impugned order. If law permits, the borrower can always tender the outstanding amounts to the Bank or the Financial Institution before a sale of the secured assets take place.

16 The two troubling parts of the impugned order being dealt with by us resulting in the hurdle in the way of the petitioner to seek further reliefs from the Debt Recovery Tribunal having been clear, we dispose of the petition expunging the directions in paragraph No. 7 of the impugned order, as also expunging the authorization in favour of Ms. Priti S. Chavan, Advocate to take possession of the Security as a Court Commissioner requiring the learned Metropolitan Magistrate to appoint an officer subordinate to take possession of the secured asset who, in turn may give custody thereof to any person.

16 We terminate the proceedings in the instant writ petition observing that on the merits of the order passed, the petitioners may approach the Debt Recovery Tribunal.”

[25] High Courts of Kerala, Madras and Delhi

[26]supra at Footnote No. 14

[27] Rule 8(3) of the Security Interest (Enforcement) Rules, 2002

The above view taken by the Bombay High Court is one of strict or literal interpretation of the provision as it exists.

15. At the outset, we must notice that the expression “any officer subordinate to him” has been used in several legislations[28] enacted by Parliament/State Legislature. Somewhat similar expression has been used in Articles 53, 154 and 311 of the Constitution of India and in other legislations[29] enacted by Parliament/State Legislature with little variation to further the intent of the concerned enactment.

[28] Section 14 of the Suppression of Immoral Traffic in Women and Girls Act, 1956; Section 5 of the Orphanages and other Charitable Homes (Supervision and Control) Act, 1960; Section 166 of the Manipur Land Revenue and Land Reforms Act, 1960; Section 10K of the Export (Quality Control and Inspection) Act, 1963; Section 43A of the Unlawful Activities (Prevention) Act, 1967; Section 5 of the Wild Life (Protection) Act, 1972; Sections 55 and 165 of the Code of Criminal Procedure, 1973; Sections 64 and 70 of the Delhi Police Act, 1978; Section 41 of the Narcotic Drugs and Psychotropic Substances Act, 1985; Sections 11 and 16 of the Foreign Trade (Development and Regulation) Act, 1992; Section 44 of the Delhi Rent Act, 1995 (also in 1958); Section 22 of the Chemical Weapons Convention Act, 2000; Section 17 of the Prevention of Money-Laundering Act, 2002; Section 30 of the Food Safety and Standards Act, 2006; Sections 107, 108 and 112 of the Central Goods and Services Tax Act, 2017; Section 8 of the Fugitive Economic Offenders Act, 2018; and Section 31 of the Banning of Unregulated Deposit Schemes Act, 2019.

[29] Article 53 (“officers subordinate to him”), Article 154 (“officers subordinate to him” and “any authority subordinate to the Governor”) and Article 311 (“an authority subordinate to that”) of the Constitution of India;

Section 376 (“police officer subordinate to such police officer”) of the Indian Penal Code, 1860;

Section 2 (“members of the subordinate ranks of any police-force”) and Section 7 (“any police-officer of the subordinate ranks”) of the Police Act, 1861;

Section 4A (“any such officer subordinate to him”) of the Guardians and Wards Act, 1890;

Section 3(5) (“Officer subordinate to the Governor General of India”) of the General Clauses Act, 1897;

Sections 8 and 22 (“officers subordinate to the Jailer”) and Section 48 (“officer subordinate to the Superintendent”) of the Prisons Act, 1894;

Section 195 (“any officer subordinate to the Collector”) of the Indian Succession Act, 1925;

Section 34H (“any subordinate officer of his”), and Sections 110A and HOB (“any person subordinate to him”) of the Insurance Act, 1938;

Section 2 (a) (“any officer subordinate to that officer”) of the Indian Coconut Committee Act, 1944;

Section 14A (“such officer or authority subordinate to the Central Government” and “such officer or authority subordinate to the State Government”) of the Industrial Employment (Standing Orders) Act, 1946;

Section 39 (“authority subordinate to the Central Government” and “authority subordinate to the State Government”) of the Industrial Disputes Act, 1947;

Section 2(g) (“subordinate officer”) of the Central Reserve Police Force Act, 1949; Section 47 (“his subordinate in rank”) of the Army Act, 1950;

Section 17 (“by an officer subordinate to that Government” and “by an officer subordinate to the State Government”) and Section 23 (“by an officer or authority subordinate to that Government”) of the Requisitioning and Acquisition of Immovable Property Act, 1952; Sections 24A and 24B (“any such officer subordinate to the Central Government or a State Government”) and Section 43 (“such officer or authority subordinate to the Central Government” and “such officer or authority subordinate to the State Government”) of the Arms Act, 1959;

Section 56 (“an officer subordinate to the Administrator”) of the Children Act, 1960;

Section 5 (“the officers subordinate to him”), Section 7 (“subordinate to the Administrator and subordinate to the deputy commissioner or the sub-divisional officer”), Section 68 (“subordinate to such officer”), Section 84 (“any revenue officer subordinate to him”), Section 93 (“an officer subordinate to the sub-divisional officer”), Section 95 (“any revenue officer subordinate to him”), Section 96 (“revenue officer subordinate to the deputy commissioner” and “any officer subordinate to the appellate or revisional authority”) and Section 166 (“any officer or authority subordinate to him”) of the Manipur Land Revenue and Land Reforms Act, 1960;

Section 5 (“any other officer of customs who is subordinate to him”), Section 28J (“the customs authorities subordinate to him”), Section 129D (“adjudicating authority subordinate to him” and “any officer of Customs subordinate to him”) and Section 129 DA (“adjudicating authority subordinate to him”) of the Customs Act, 1962;

Section 10M (“any officer subordinate to the Director of Inspection and Quality Control”) and Section 13 (“authority subordinate to the Central Government”) of the Export (Quality Control and Inspection) Act, 1963;

Section 79 (“any officer subordinate to the Board”) of the Punjab Reorganisation Act, 1966;

Section 42 (“any person subordinate to the State Government”) of the Unlawful Activities (Prevention) Act, 1967;

Section 21 (“authority subordinate to the Central Government” and “authority subordinate to such Government”) of the Passports Act, 1967;

Section 34 (“any officer subordinate to it”) and Section 154 (“any police officer subordinate to him”) of the Code of Criminal Procedure, 1973;

Section 12 (“an officer subordinate to that Government” and “an officer subordinate to a State Government”) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974;

Section 3 (“subordinate ranks of the police force”), Section 12 (“other officers of subordinate rank”), Section 20 (“his subordinates”), Sections 21 and 25 (“any police officer of subordinate rank”), Section 58 (“officers subordinate to him”), Section 70 (“any officer subordinate to the Commissioner of Police”), Section 122 (“police officer of subordinate rank”) and Section 147 (“any police officer of subordinate rank”) of the Delhi Police Act, 1978;

Section 14 (“to which that officer is subordinate”) of the National Security Act, 1980; Section 23 (“an Income-tax Officer subordinate to him”) of the Hotel-Receipts Tax Act, 1980;

Section 17A (“the officer, subordinate to him”) of the Child and Adolescent Labour (Prohibition and Regulation) Act, 1986;

Section 13 (“an officer subordinate to that Government”) of the Prevention of Illicit Traffic in Narcotic Drugs and Psychotropic Substances Act, 1988;

Section 93 (“by an officer or authority subordinate to the Central Government”) of the Railways Act, 1989;

Section 6 (“such other officer subordinate to the Director General”) and Section 15 (“an officer subordinate to the Director General”) of the Foreign Trade (Development and Regulation) Act, 1992;

Sections 46 and 328 (“an officer subordinate to him”) of the New Delhi Municipal Council Act, 1994;

Sections 23 and 24 (“any such subordinate officer to the enforcement officer”) and Section 37 (“any subordinate officer”) of the Chemical Weapons Convention Act, 2000;

Section 80 (“any officer subordinate to the Board”) of the Bihar Reorganisation Act, 2000;

Section 81 (“any officer subordinate to the Board”) of the Uttar Pradesh Reorganisation Act, 2000;

Section 26 (“such officer subordinate to the Central Government or the State Government”) of the Mahatma Gandhi National Rural Employment Guarantee Act, 2005;

Section 22 (“the officer, subordinate to him”) of the Maintenance and Welfare of Parents and Senior Citizens Act, 2007;

Section 54 (“such officer subordinate to it”) of the Legal Metrology Act, 2009;

Section 43 (“employees who shall be subordinate to him”) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013;

Section 86 (“any officer subordinate to the Board”) of the Andhra Pradesh Reorganisation Act, 2014;

Section 5 (“any other officer who is subordinate to him”) of the Central Goods and Services Tax Act, 2017;

Section 45 (“an officer subordinate to that Government or the local authority”) of the Human Immunodeficiency Virus and Acquired Immune Deficiency Syndrome (Prevention and Control) Act, 2017;

Section 100 (“authority subordinate to the Central Government” and “authority subordinate to the State Government”) of the Industrial Relations Code, 2020.

16. The construct of the provision, however, must depend on the context of the legislative intent and the purpose for which such dispensation has been envisaged. The setting in which the expression has been used in the concerned section of the Act would assume significance.

17. This Court has had occasion to deal with identical provision in the Motor Vehicles Act, 1939[30], in the case of-A. St. Arunachalam Pillai vs. M/s. Southern Roadways Ltd. & Anr., AIR 1960 SC 1191 (5-Judge Bench). Even in that case, the Court had to resolve the conflicting views of the Full Bench of the Madras High Court and of the High Court of Andhra Pradesh. The Full Bench of the Madras High Court in S. Krishnaswamy Mudaliar & Anr. vs. P.S. Palani Pillai & Anr., AIR 1957 Mad 599 had occasion to consider the question as to whether Regional Transport Officer was subordinate to the State Transport Commissioner. While examining that question, the Full Bench of the Madras High Court dealt with three views pressed into service before it. The first view was founded on “administrative subordination”, the second on “functional subordination” and the third on “statutory subordination”. The Full Bench accepted the third view, namely, “statutory subordination”, being a safer and logical approach. In the context of the provisions of that Act, it was held that the Regional Transport Officer was not subordinate to the State Transport Commissioner.

[30] for short, “1939 Act”

18. Analysing the same provision, being Section 44-A of the 1939 Act, the Full Bench of the High Court of Andhra Pradesh, however, opined to the contrary in B. Veeraswamy & Ors. vs. State of Andhra Pradesh & Ors., AIR 1959 AP 413. It followed the root of “administrative subordination”. The matter reached this Court where the Constitution Bench by majority upheld the view taken by the Full Bench of the High Court of Andhra Pradesh and, thus, invoked the “administrative subordination” logic. This Court in the context of the statutory provisions and the Government Orders issued by the concerned department concluded that the Regional Transport Officers were subordinate to the Transport Commissioner. It was also observed that in the matter of interpretation, the words of provisions must be looked at; and if they are expansive enough to mean any officer subordinate to the Transport Commissioner, that must be given effect to.

19. As aforesaid, while considering the purport of the expression in Section 14(1 A) of the 2002 Act, it must be noticed that the said provision was inserted vide Act 1 of 2013 with effect from 15.1.2013. In absence of express provision, such as sub-Section (1A) under the unamended Act, the CMM/DM could take possession of secured assets on a written application made by the secured creditor under Section 14(1); and while doing so in terms of Section 14(2) of the 2002 Act, it was open to the CMM/DM to take or cause to be taken such steps and use, or cause to be used, such force, as may, in his opinion be necessary. This would include taking assistance of the local Police to obviate any untoward situation or law and order problem at the site while taking over possession. While construing that provision as early as in 2008, the High Court of Kerala in the case of Muhammed Ashraf[31] gave expansive meaning to the rule that it was open to the CMM/DM to take assistance of an advocate to be appointed as a commissioner for taking possession of the secured assets and documents relating thereto for being handed over or forwarded to the secured creditor. It was an inherent or implicit power vested in the stated authority and more particularly because advocates were no less than officers of the court of the CMM/DM. This view has been consistently followed not only by the High Court of Kerala, but also by other High Courts such as High Courts of Madras and Delhi. Most of the CMMs /DMs across the country have been following that dispensation. The only discordant note can be discerned from the decision of the Bombay High Court which is impugned before us. The Bombay High Court has followed the strict and literal interpretation rule and, thus, preferred “statutory subordination” logic. The view so taken can be sustained only if we were to hold that legislative intent in using the expression “any officer subordinate to him” completely rules out the other option which is being followed since commencement of the Act in 2002.

[31] supra at Footnote No.8

20. Indeed, in the case of advocate, the logic of “administrative subordination” or “statutory subordination” cannot be extended. Inasmuch as, for being a case of “statutory subordination”, the provisions of the 2002 Act and the Security Interest (Enforcement) Rules, 2002[32] made thereunder, must expressly provide for such mechanism. This cannot be said about the provisions of the 2002 Act and the Rules made thereunder. Even the logic of “administrative subordination” as considered by this Court in A. St. Arunachalam Pilled[33] cannot be invoked. For, the advocate by no stretch of imagination can fit into the administrative set up of the Office of the CMM/DM.

[32] for short, “2002 Rules”

[33] supra at Footnote No. 41

21. That leaves us with the third possibility of “functional subordination”. For invoking that logic, we must necessarily conclude that the provisions under consideration are wide enough and expansive to encompass engaging services of Advocate Commissioner. For that purpose, we must first advert to the Statement of Objects and Reasons for which the 2002 Act has been enacted. The same reads thus:

“STATEMENT OF OBJECTS AND REASONS

The financial sector has been one of the key drivers in India’s efforts to achieve success in rapidly developing its economy. While the banking industry in India is progressively complying with the international prudential norms and accounting practices there are certain areas in which the banking and financial sector do not have a level playing field as compared to other participants in the financial markets in the world. There is no legal provision for facilitating securitisation of financial assets of banks and financial institutions. Further, unlike international banks, the banks and financial institutions in India do not have power to take possession of securities and sell them. Our existing legal framework relating to commercial transactions has not kept pace with the changing commercial practices and financial sector reforms. This has resulted in slow pace of recovery of defaulting loans and mounting levels of non-performing assets of banks and financial institutions. Narasimham Committee I and II and Andhyarujina Committee constituted by the Central Government for the purpose of examining banking sector reforms have considered the need for changes in the legal system in respect of these areas. These Committees, inter alia, have suggested enactment of a new legislation for securitisation and empowering banks and financial institutions to take possession of the securities and to sell them without the intervention of the court. Acting on these suggestions, the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Ordinance, 2002 was promulgated on the 21st June, 2002 to regulate securitisation and reconstruction of financial assets and enforcement of security interest and for matters connected therewith or incidental thereto. The provisions of the Ordinance would enable banks and financial institutions to realise long-term assets, manage problem of liquidity, asset liability mismatches and improve recovery by exercising powers to take possession of securities, sell them and reduce non-performing assets by adopting measures for recovery or reconstruction.” (emphasis supplied)

22. The underlying purpose of the 2002 Act is to empower the financial institutions in India to have similar powers as enjoyed by their counterparts, namely, international banks in other countries. One such feature is to empower the financial institutions to take possession of securities and sell them. The same has been translated into provisions falling under Chapter III of the 2002 Act. Section 13 deals with enforcement of security interest. Sub-Section (4) thereof envisages that in the event a default is committed by the borrower in discharging his liability in full within the period specified in sub-Section (2), the secured creditor may take recourse to one or more of the measures provided in sub-Section (4). One of the measures is to take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset. That, they could do through their “authorised officer” as defined in Rule 2(a)[34] of the 2002 Rules.

[34] 2. Definitions.-In these rules, unless the context otherwise requires,-

(a) “authorised officer” means an officer not less than a chief manager of a public sector bank or equivalent, as specified by the Board of Directors or Board of Trustees of the secured creditor or any other person or authority exercising powers of superintendence, direction and control of the business or affairs of the secured creditor, as the case may be, to exercise the rights of a secured creditor under the Act;

23. After taking over possession of the secured assets, further steps to lease, assign or sale the same could also be taken by the secured creditor. However, Section 14 of the 2002 Act predicates that if the secured creditor intends to take possession of the secured assets, must approach the CMM/DM by way of an application, in writing, and on receipt of such request, the CMM/DM must move into action in right earnest. After passing an order thereon, he/she (CMM/DM) must proceed to take possession of the secured assets and documents relating thereto for being forwarded to the secured creditor in terms of Section 14(1) read with Section 14(2) of the 2002 Act. As noted earlier, Section 14(2) is an enabling provision and permits the CMM/DM to take such steps and use force, as may, in his opinion, be necessary. This position obtained even before the amendment of 2013 i.e., insertion of sub-Section (1A) and continues to this date.

24. Incidentally, it needs to be noted that along with insertion of sub-Section (1A), a proviso has also been inserted in sub-Section (1) of Section 14 of the 2002 Act whereby the secured creditor (Bank/Financial Institution) is now required to comply certain conditions and to disclose that by way of an application accompanied by affidavit duly affirmed by its authorised officer in that regard. Sub-Section (1A) is in the nature of an explanatory provision and it merely restates the implicit power of the CMM/DM in taking services of any officer subordinate to him. The insertion of sub-Section (1A) is not to invest a new power for the first time in the CMM/DM as such.

25. Thus understood, the question is: whether the past practice followed by most of the courts across the country in recognising the power of the CMM/DM to appoint an advocate as a commissioner to assist him in merely taking possession of the secured assets and documents relating thereto and to forward the same to the secured creditor, needs to be discontinued as being prohibited owing to insertion of sub-Section (1A)? Section 14 of the 2002 Act, as amended and applicable to the cases on hand, reads thus:

14. Chief Metropolitan Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset.-(1) Where the possession of any secured assets is required to be taken by the secured creditor or if any of the secured assets is required to be sold or transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured assets, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or, as the case may be, the District Magistrate shall, on such request being made to him-

(a) take possession of such asset and documents relating thereto; and

(b) forward such asset and documents to the secured creditor:

Provided that any application by the secured creditor shall be accompanied by an affidavit duly affirmed by the authorised officer of the secured creditor, declaring that-

(i) the aggregate amount of financial assistance granted and the total claim of the Bank as on the date of filing the application;

(ii) the borrower has created security interest over various properties and that the Bank or Financial Institution is holding a valid and subsisting security interest over such properties and the claim of the Bank or Financial Institution is within the limitation period;

(iii) the borrower has created security interest over various properties giving the details of properties referred to in sub-clause (ii) above;

(iv) the borrower has committed default in repayment of the financial assistance granted aggregating the specified amount;

(v) consequent upon such default in repayment of the financial assistance the account of the borrower has been classified as a non-performing asset;

(vi) affirming that the period of sixty days notice as required by the provisions of sub-section (2) of section 13, demanding payment of the defaulted financial assistance has been served on the borrower;

(vii) the objection or representation in reply to the notice received from the borrower has been considered by the secured creditor and reasons for non-acceptance of such objection or representation had been communicated to the borrower;

(viii) the borrower has not made any repayment of the financial assistance in spite of the above notice and the Authorised Officer is, therefore, entitled to take possession of the secured assets under the provisions of sub-section (4) of section 13 read with section 14 of the principal Act;

(ix) that the provisions of this Act and the rules made thereunder had been complied with:

Provided further that on receipt of the affidavit from the Authorised Officer, the District Magistrate or the Chief Metropolitan Magistrate, as the case may be, shall after satisfying the contents of the affidavit pass suitable orders for the purpose of taking possession of the secured assets within a period of thirty days from the date of application:

Provided also that if no order is passed by the Chief Metropolitan Magistrate or District Magistrate within the said period of thirty days for reasons beyond his control, he may, after recording reasons in writing for the same, pass the order within such further period but not exceeding in aggregate sixty days.

Provided also that the requirement of filing affidavit stated in the first proviso shall not apply to proceeding pending before any District Magistrate or the Chief Metropolitan Magistrate, as the case may be, on the date of commencement of this Act.

(1A) The District Magistrate or the Chief Metropolitan Magistrate may authorise any officer subordinate to him,-

(i) to take possession of such assets and documents relating thereto; and

(ii) to forward such assets and documents to the secured creditor.

(2) For the purpose of securing compliance with the provisions of sub-section (1), the Chief Metropolitan Magistrate or the District Magistrate may take or cause to be taken such steps and use, or cause to be used, such force, as may, in his opinion, be necessary.

(3) No act of the Chief Metropolitan Magistrate or the District Magistrate any officer authorised by the Chief Metropolitan Magistrate or District Magistrate done in pursuance of this section shall be called in question in any court or before any authority.” (emphasis supplied)

26. Considering the scheme of the 2002 Act, it is explicit and crystal clear that possession of the secured assets can be taken by the secured creditor before confirmation of sale of the secured assets as well as post-confirmation of sale. For taking possession of the secured assets, that could be done by the “authorised officer” of the Bank as noted in Rule 8 of the 2002 Rules, which reads thus:

“8. Sale of immovable secured assets.-(1) Where the secured asset is an immovable property, the authorised officer shall take or cause to be taken possession, by delivering a possession notice prepared as nearly as possible in Appendix IV to these rules, to the borrower and by affixing the possession notice on the outer door or at such conspicuous place of the property.

(2) The possession notice as referred to in sub-rule (1) shall also be published, as soon as possible but in any case not later than seven days from the date of taking possession, in two leading newspapers, one in vernacular language having sufficient circulation in that locality, by the authorised officer.

(2-A) All notices under these rules may also be served upon the borrower through electronic mode of service, in addition to the modes prescribed under sub-rule (1) and sub-rule (2) of rule 8.

(3) In the event of possession of immovable property is actually taken by the authorised officer, such property shall be kept in his own custody or in the custody of any person authorised or appointed by him, who shall take as much care of the property in his custody as a owner of ordinary prudence would, under the similar circumstances, take of such property.

(4) The authorised officer shall take steps for preservation and protection of secured assets and insure them, if necessary, till they are sold or otherwise disposed of.

(5) Before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorised officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods:-

(a) by obtaining quotations from the persons dealing with similar secured assets or otherwise interested in buying the such assets; or

(b) by inviting tenders from the public;

(d) by private treaty.

Provided that in case of sale of immovable property in the State of Jammu and Kashmir, the provisions of Jammu and Kashmir Transfer of Property Act, 1977 shall apply to the person who acquires such property in the State.

(6) the authorised officer shall serve to the borrower a notice of thirty days for sale of the immovable secured assets, under sub-rule (5):

Provided that if the sale of such secured asset is being effected by either inviting tenders from the public or by holding public auction, the secured creditor shall cause a public notice in the Form given in Appendix IV-A to be published in two leading newspapers including one in vernacular language having wide circulation in the locality.

(7) every notice of sale shall be affixed on the conspicuous part of the immovable property and the authorised officer shall upload the detailed terms and conditions of the sale, on the web-site of the secured creditor, which shall include;

(a) the description of the immovable property to be sold, including the details of the encumbrances known to the secured creditor;

(b) the secured debt for recovery of which the property is to be sold;

(d) time and place of public auction or the time after which sale by any other mode shall be completed;

(e) deposit of earnest money as may be stipulated by the secured creditor;

(f) any other terms and conditions, which the authorized officer considers it necessary for a purchaser to know the nature and value of the property.

(8) Sale by any methods other than public auction or public tender, shall be on such terms as may be settled between the secured creditor and the proposed purchaser in writing.”

27. However, for taking physical possession of the secured assets in terms of Section 14(1) of the 2002 Act, as aforementioned, the secured creditor is obliged to approach the CMM/DM by way of a written application requesting for taking possession of the secured assets and documents relating thereto and for being forwarded to it (secured creditor) for further action.

28. The statutory obligation enjoined upon the CMM/DM is to immediately move into action after receipt of a written application under Section 14(1) of the 2002 Act from the secured creditor for that purpose. As soon as such application is received, the CMM/DM is expected to pass an order after verification of compliance of all formalities by the secured creditor referred to in the proviso in Section 14(1) of the 2002 Act and after being satisfied in that regard, to take possession of the secured assets and documents relating thereto and to forward the same to the secured creditor at the earliest opportunity. The latter is a ministerial act. It cannot brook delay. Time is of the essence. This is the spirit of the special enactment. However, it is common knowledge that the CMM/DM are provided with limited resources. That inevitably makes it difficult, if not impossible, for the CMM/DM to fulfil his/her obligations with utmost dispatch to uphold the spirit of the special legislation.

29. It is common knowledge that in the respective jurisdictions, there is only one CMM/DM. If he is expected to reach at every location himself for taking possession, in some jurisdictions it would be impracticable, if not impossible, for him to do so owing to large number of applications in the given jurisdiction being a commercial city. Accordingly, strict construct would defeat the legislative intent and purpose for enacting the 2002 Act. Indeed, logistical problems of the Office of the CMM/DM cannot be the basis to overlook the statutory provision. However, we are persuaded to take the view that an advocate is and must be regarded as an officer of the court and subordinate to the CMM/DM for the purposes of Section 14(1A) of the 2002 Act.

30. Furthermore, as was the situation obtaining before insertion of sub-Section (1A) wherein the CMM/DM could avail the services of an advocate or any officer subordinate to him for discharging the ministerial work of taking possession of the secured assets and documents relating thereto, nothing prevents him/her from continuing to follow the same regime even after the insertion of sub-Section (1A). At the same time, while entrusting the act of taking possession of the secured assets consequent to the order passed under Section 14(1) of the 2002 Act to any officer subordinate to him, the CMM/DM ought to exercise prudence in appointing such person who will be capable of executing the orders passed by him. Merely because he has power to appoint “any” officer subordinate to him, it would not permit him to appoint a peon or clerk, who is incapable of handling the situation.

31. Be that as it may, the expression “any” in section has not been defined in the 2002 Act or the 2002 Rules. So also, the expressions “officer” and “subordinate” are not defined singularly or collectively. The meaning of expression “any” as given in Black’s Law Dictionary[35] reads thus:

“Any. Some; one out of many; an indefinite number. One indiscriminately of whatever kind or quantity. Federal Deposit Ins. Corporation v. Winton, CCA. Tenn., 131 F.2 d 780, 782. One or some (indefinitely). Slegel v. Slegel, 135 N.J. Eq. 5, 37 A.2d 57, 58. “Any” does not necessarily mean only one person, but may have reference to more than one or to many. Doherty v. King, Tex. Civ.App., 183 S.W.2d 1004, 1007.

Word “any” has a diversity of meaning and may be employed to indicate “all” or “every” as well as “some” or “one” and its meaning in a given statute depends upon the context and the subject matter of the statute.

Donohue v. Zoning Bd. of Appeals of Town of Norwalk, 155 Conn. 550, 235 A. 2d 643, 646, 647.

It is often synonymous with “either”, “every” or “all”. Its generality may be restricted by the context;

thus, the giving of a right to do some act “at any time” is commonly construed as meaning within a reasonable time; and the words “any other” following the enumeration of particular classes are to be read as “other such like,” and include only others of like kind or character.” (emphasis supplied)

[35] 6^th Edition

32. The expression “officer” as defined in the Black’s Law

Dictionary[36] reads thus:

“officer. (14c) 1. Someone who holds an office of trust, authority, or command. In public affairs, the term refers esp. to a person holding public office under a national, state, or local government, and authorized by that government to exercise some specific function. In corporate law, the term refers esp. to a person elected or appointed by the board of directors to manage the daily operations of a corporation, such as a CEO, president, secretary, or treasurer. Cf. DIRECTOR (2). (emphasis supplied)

[36] 11^th Edition

33. The expression “subordinate” as given in P. Ramanatha Aiyar’s Advanced Law Lexicon[37]reads thus:

“Subordinate” defined. Act 24, 1859, section 1; Mad Act 3, 1909, section 2.

Belonging to an inferior rank, grade, class or order; dependent upon the authority or power of another [Section 121, Indian Evidence Act (1 of 1872)]; a person or thing that is ranked lower.

By the use of the word ‘subordinate’ without any qualifying words, the legislature has expressed its legislative intention of making punishable such subordinates also who have no connection with the functions with which the business or transaction is concerned. An Assistant Controller of Imports in the office of the Joint Chief Controller of Imports and Exports is a subordinate of the joint Chief Controller through the acceptance of the bribe has nothing to do with the appeal pending before the Joint Chief Controller. R.G. Jacob v Republic of India, AIR 1963 SC 550, 553. [Indian Penal Code (45 of 1860), section 165 (omitted by Prevention of Corruption Act, 1988)]

The construction placed on the expression ‘subordinate’ occurring in Rule 14(2) of the Rules is in consonance with the meaning and import of the word ‘subordinate’ occurring in Article 311(1) of the Constitution. There is nothing in the Constitution which debars the Government from exercising the power of appointing authority to dismiss a Government servant from service. These Rules cannot be read as implying that dismissal must be by the very authority who made the appointment or by his immediate superior. There is a compliance with Article 311(1) if the dismissing authority is not lower in rank or grade than the appointing authority. [Govt. of A.P. v N. Ramanaiah, (2009) 7 SCC 165, 172, paras 23, 24] [Constitution of India, Article 311(1); A.P. Civil Services (CCA) Rules, 1991, rule 14(2)]

The word ‘subordinate’ in section (2)(f) means subordinate in law and not in fact. Although a person looking after the business of another person as manager, may not in fact be subordinate to the other person and may be acting on his own initiative, yet if, as an individual manager, he is in law subordinate to the employer, namely, the other person, he cannot be regarded as the “managing agent” of employer as defined in section 2(l)(f), and no order of compensation can be made against him. Raghunath Sahai v Sarup Singh, MLJ : QD (1961-1965) Vol V C1952-1953 : 1962 All LJ 104 : 1962 All WR (HC) 91 : (1962) 1 LLJ 19 : (1961) 3 Fac LR 445 : (1962-63) 23 FJR 624 : AIR 1962 All 620 [Workmen’s Compensation Act (8 of 1923), section 2(l)(f)]

The word ‘subordinate’ also means judicial or quasi judicial administrative subordination to the Director of consolidation. Ram Narain v Director of Consolidation, AIR 1965 All 172, 173. [U.P. Consolidation of Holdings Act (5 of 1954), section 48 (as amended in 1963), section 48]

The provisions made in Section 133-A were already there when Section 44-A was added to the Act by the Madras Act (XX of 1948). The latter Act does not contain any separate definition of the word “subordinate”.

Naturally, no definition was necessary in view of the provision already made in Section 133-A. It must be assumed that the Madras Legislature was aware of the existence of Section 133-A when it introduced Section 44-A, and, when it used the word “subordinate” in that section, it must have intended that the word “subordinate” should be understood only in the manner to determine which provision had already been made in Section 133-A of the Act. Krishna Swamy Mudaliar v Palani Pillai, MLJ : QD (1956-1960) Vol. IV C151 : (S) AIR 1957 Mad 599 (FB). [Motor Vehicles Act (4 of 1939), section 133-A]

The word ‘subordinate’ occurring in Article 311(1), has reference to subordination in rank and not subordination in respect of powers and duties. Article 311(1) cannot be read as implying that the removal must be by the very same authority who made the appointment or by his direct superior. It is enough that the removing authority is of the same rank of grade. Laxminarayana Sarangi v State of Orissa, MLJ : QD (1961-1965) Vol. II C1050 : AIR 1963 Orissa8 : ILR (1962) Cut 492. [Constitution of India, Article

The word ‘subordinate’ in Article 311(1) Constitution of India, means subordination in rank and not subordination of function. Mahadev Prasad Roy v. S.N. Chatterjee, AIR 1954 Pat 285.

The word ‘subordinate’ in Article 311(1) of the Constitution of India means subordinate in rank and not with reference to the functions exercised. Consequently when no officer of equal rank to the appointing officer is available then the order of dismissal or removal will have to be passed by an officer of superior rank. In no circumstances can such an order be passed by an officer of lesser rank. Any rule or statute which permits such an action must be held to be ultra vires as infringing the provisions of Article 311(1) of the Constitution. Gurmukh Singh v UOI, New Delhi, MLJ : QD (1961-1965) Vol. 11 C1050 : 65 Punj LR 964 : AIR 1963 P&H 370

For the purposes of transfer applications of suits from the Original Side of the High Court the Judge sitting on the original side is subordinate to the appellate side of the High Court. (AIR 1923 Rang. 22)” (emphasis supplied)

[37] Volume 4 (6^th Edition)

34. The expression “officer subordinate” as defined in Venkataramaiya’s Law Lexicon & Legal Maxims[38] reads thus:

“”Officer subordinate.”- What is the exact purport of the component words of the expression “any officer subordinate” used in the Sec. 44-A of the Motor Vehicles Act, 1939. “Any” is a word which excludes limitation or qualification. It connotes wide generality. Its use points to a distributive construction. The word “any” is used in the sense of “any body”, “any person”. The individual who is invested with the authority and is required to perform the duties incidental to an office is an officer. For determining whether officers are subordinate or not the test is not whether a review of such of their determinations as are quasi-judicial may be had, but whether in the performance of their various duties they are subject to the direction and control of a superior officer, or are independent officers subject only to such directions as the statute gives.- B. Veeraswamy v. State of Andhra Pradesh, (1959) Andh. W.R. 308 at p.314: A.I.R. 1959 A.P. 413 (F.B.)” (emphasis supplied)

[38] Vol. Ill (2^nd Edition)

35. The expressions “officer, subordinate” and “officers subordinate to him” as given in P. Ramanatha Aiyar’s Advanced Law Lexicon[39] read thus:

“Officer, subordinate. Officer belonging to an inferior rank, grade, class or order.

Officers subordinate to him. A Minister is an officer subordinate to the Governor. Shiv Bahadur Singh v State of Uttar Pradesh, AIR 1953 SC 394.”

[39]Volume 3 (6^th Edition)

36. As regards the procedure for taking possession of the secured assets, it can be discerned from Section 13 read with Section 14 of the 2002 Act. Section 13(4) permits the secured creditor to take recourse to one or more of the specified measures; and to enable the secured creditor to do so even at the stage of pre-confirmation of sale; in terms of Section 14, the CMM/DM has power in that regard albeit after passing order on a written application given by the secured creditor for that purpose. Once the order is passed, the statutory obligation cast upon the CMM/DM stands discharged to that extent. The next follow-up step is of taking possession of the secured assets and documents relating thereto. The same is ministerial step. It could be taken by the CMM/DM himself/herself or through any officer subordinate to him/her, including the Advocate Commissioner who is considered as an officer of his/her court. The Advocate Commissioner is not a new concept. The advocates are appointed as Court Commissioner to perform diverse administrative and ministerial work as per the provisions of Code of Civil Procedure and Code of Criminal Procedure. An advocate is an officer of the court. This has been expounded in Virginia Law Review[40], in the following words:

“The duties of the lawyer to the Court spring directly from the relation that he sustains to the Court as an officer in the administration of justice. The law is not a mere private calling but is a profession which has the distinction of being an integral part of the State’s judicial system. As an officer of the Court the lawyer is, therefore, bound to uphold the dignity and integrity of the Court; to exercise at all times respect for the Court in both words and actions; to present all matters relating to his client’s case openly, being careful to avoid any attempt to exert private influence upon either the judge or the jury; and to be frank and candid in all dealings with the Court, “using no deceit, imposition or evasion,” as by misreciting witnesses or misquoting precedents. “It must always be understood,” says Mr. Christian Doerfler, in an address before the Milwaukee County Bar Association, in December, 1911, “that the profession of law is instituted among men for the purpose of aiding the administration of justice. A proper administration of justice does not mean that a lawyer should succeed in winning a lawsuit. It means that he should properly bring to the attention of the Court everything by way of fact and law that is available and legitimate for the purpose of properly presenting his client’s case. His duty as far as his client is concerned is simply to legitimately present his side of the case. His duty as far as the public is concerned and as far as he is an officer of the Court is to aid and assist in the administration of justice.” (emphasis supplied)

[40] Vol. 11, No. 4 (Feb 1925) pp. 263-77

37. It would be useful to advert to the enunciation in Black’s Law Dictionary[41] in respect of expression “amicus curiae” which reads thus:

“amicus curiae. [Latin “friend of the court”] (17C) Someone who is not a party to a lawsuit but who petitions the court or is requested by the court to file a brief in the action because that person has a strong interest in the subject matter.- Often shortened to arnicas. – Also termed friend of the. court. PI. amici curiae”

[41]11^th Edition

38. Even this Court had occasion to expound about the role of the advocate as being an officer of the court in Lalit Mohan Das vs. The Advocate-General, Orissa & Anr., AIR 1957 SC 250. The Constitution Bench observed thus:

“(11) …..A member of the Bar undoubtedly owes a duty to his client and must place before the Court all that can fairly and reasonably be submitted on behalf of his client. He may even submit that a particular order is not correct and may ask for a review of that order. At the same time, a member of the Bar is an officer of the Court and owes a duty to the Court in which he is appearing. He must uphold the dignity and decorum of the Court and must not do anything to bring the Court itself into disrepute. (emphasis supplied)

39. It is well established that an advocate is a guardian of constitutional morality and justice equally with the Judge. He has an important duty as that of a Judge. He bears responsibility towards the society and is expected to act with utmost sincerity and commitment to the cause of justice. He has a duty to the court first. As an officer of the court, he owes allegiance to a higher cause and cannot indulge in consciously misstating the facts or for that matter conceal any material fact within his knowledge. In the case of O.P. Sharma & Ors. vs. High Court of Punjab & Haryana(2011) 6 SCC 86 (para 38), the Court noted that in all professional functions, an advocate should be diligent and his conduct should conform to the requirements of the law by which he plays a vital role in the preservation of society and justice system. As an officer of the court, he is under a higher obligation to uphold the rule of law and justice system.

40. Be it noted that Section 38 of the 2002 Act empowers the Central Government to make rules for carrying out the provisions of the 2002 Act. Sub-Section (2) thereof does not specifically/expressly refer to power to make rule in respect of matter provided for in Section 14 unlike other provisions noted therein. However, it is open to the Central Government to frame rules in that regard by invoking clause (g) of sub-Section (2) of Section 38. The same reads thus:

“38. Power of Central Government to make rules.-(1)

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:-

(a) to (fc) …..

(g) any other matter which is required to be, or may be, prescribed, in respect of which provision is to be, or may be, made by rules.”

41. Pertinently, no such rule has been framed by the Central Government in reference to sub-Section (1A) of Section 14 of the 2002 Act much less to expressly or by necessary implication prohibiting the CMM/DM to engage an Advocate Commissioner for taking possession of the secured assets. In absence thereof, exclusion of engagement of an advocate as commissioner cannot be countenanced.

42. Whereas, applying the “functional subordination” test, we are persuaded to take the view that sub-Section (1A) of Section 14 of the 2002 Act is no impediment for the CMM/DM to engage services of an advocate (an officer of the court) – only for taking possession of secured assets and documents relating thereto and to forward the same to the secured creditor in furtherance of the orders passed by the CMM/DM under Section 14(1) of the 2002 Act in that regard. It does not follow that the advocate so appointed needs to be on the rolls in the Office of the CMM/DM or in public service. There is intrinsic de jure functional subordinate relationship between the CMM/DM and the advocate being an officer of the court. The apprehension of the borrowers about improper execution of orders of the CMM/DM passed under Section 14(1) of the 2002 Act by the Advocate Commissioner, is plainly misplaced. Further, being an officer of the court and appointed by the CMM/DM, the acts done by the Advocate Commissioner would receive immunity under Section 14(3) of the 2002 Act – as an officer authorised by the CMM/DM. There is no reason to assume that the advocate so appointed by the CMM/DM would misuse the task entrusted to him/her and that will not be carried out strictly as per law or it would be a case of abuse of power. Rather, going by the institutional faith or trust reposed on advocates being officers of the court, there must be a presumption that if an advocate is appointed as commissioner for execution of the orders passed by the CMM/DM under Section 14(1) of the 2002 Act, that responsibility and duty will be discharged honestly and in accordance with rules of law.

43. For the view taken by us hitherto, the exposition in Satheedevi vs. Prasanna & Anr., (2010) 5 SCC 622, M/s. Hiralal Rattanlal etc. etc. vs. State of U.P. & Anr. etc. etc., (1973) 1 SCC 216, and Dipak Babaria & Anr. vs. State of Gujarat & Ors., (2014) 3 SCC 502, will be of no avail to the borrowers. In that, we have not invoked the principle of casus omissus. In our view, in law, an advocate is an officer of the court and, thus, subordinate to the CMM/DM. Further, there is no indication in the 2002 Act or the Rules made thereunder to exclude such interpretation. For the same reason, the plea regarding applying principle of ejusdem generis or noscitur a sodis and for that matter, expressio unius est exclusio alterius, also need not detain us.

44. The secured creditors would rely on the dictum of this Court in Authorised Officer, Indian Bank vs. D. Visalakshi & Anr., (2019) 20 SCC 47 wherein this Court upon considering the nature of activities of the Chief Judicial Magistrate[42] on the one hand and that of the CMM/DM on the other, held that the CJM is competent to process the request of the secured creditor to take possession of the secured assets under Section 14 of the 2002 Act. However, it is unnecessary to dilate on that decision considering the view taken hitherto that the advocate must be regarded as an officer of the court and, in law, subordinate to the concerned CMM/DM within their jurisdiction. This interpretation in applying “functional subordination” test, would further the legislative intent and the purpose for enacting the 2002 Act. We hold that it would be open to the CMM/DM to appoint an advocate commissioner to assist him/her in execution of the order passed under Section 14(1) of the 2002 Act.

[42] for short, “CJM”

45. A fortiori, the judgment and order of the Bombay High Court impugned in the present appeals[43] is declared as not a good law.

[43]see Footnote No. 5

Whereas, we uphold the conclusion of the three High Courts, namely, High Courts of Kerala, Madras and Delhi on the question under consideration.

46. Although, we have agreed with the view taken by the Madras High Court about the power of the CMM/DM to appoint an Advocate Commissioner, yet S.L.P (Civil) No. 12011 of 2020 filed by the borrowers needs to be delinked and heard for admission separately, limited to the first issue about compliance or non-compliance of clauses (i) to (ix) of Section 14 of the 2002 Act. That issue has been answered by the High Court in favour of the secured creditor and against the borrowers, in paragraphs 10 and 11 of the impugned judgment. The correctness whereof will have to be considered on its own merits.

47. In view of the above:

(i) the appeals[44] filed by the secured creditors are allowed. Resultantly, the impugned judgment and order passed by the Bombay High Court is set aside and the subject writ petition[45] stands dismissed.

(ii) The special leave petition[46] filed by the borrowers against the impugned judgment and order of the Madras High Court is delinked for being heard for admission on 4.3.2022, on the limited issue (first issue) regarding compliance or non-compliance of clauses (i) to (ix) of Section 14 of the 2002 Act in the fact situation of the present case,

(iii) No order as to costs.

Pending application(s), if any, stands disposed of.

[44] Civil Appeal No…..of 2022 @ SLP (Civil) No. 30240 of 2019; Civil Appeal No…..of 2022 @ SLP (Civil) No. 2055 of 2020; Civil Appeal No…..of 2022 @ SLP (Civil) No……of 2022 @ Diary No. 17059 of 2020; and Civil Appeal No…..of 2022 @ SLP (Civil) No……of 2022 @ Diary No. 23733 of 2020 [Footnote No. 5]

[45] Writ Petition (L) No. 28480 of 2019 [Footnote No. 17]

[46] SLP (Civil) No. 12011 of 2020 [Footnote No. 7]

Posted on 23rd February 2022 by rajatbindal5gmailcom — Leave a comment

Material fact of mental disorder not disclosed – Divorce granted

DELHI HIGH COURT

DIVISION BENCH

SANDEEP AGGARWAL — Appellant

Vs.

PRIYANKA AGGARWAL — Respondent

( Before : Vipin Sanghi and Jasmeet Singh, JJ. )

MAT. APP. (F.C.) No. 142 of 2020

Decided on : 24-12-2021

Civil Procedure Code, 1908 (CPC) – Order 26 Rule 10A, Section 151, Section 75(e)
Constitution of India, 1950 – Article 20, Article 21
Evidence Act, 1872 – Section 114
Family Courts Act, 1984 – Section 19
Hindu Marriage Act, 1955 – Section 12, Section 12(1)(b), Section 12(2)(a)(i), Section 12(2)(a)(ii), Section 13(1)(iii), Section 28, Section 5(ii), Section 9

Cases Referred

Kollam Chandra Sekhar vs. Kollam Padma Latha (2014) 1 SCC 225
Sharda vs. Dharmpal MANU/SC/0260/2003

Final Result : Allowed

JUDGMENT/ORDER

Jasmeet Singh, J. – The present appeal has been filed under Section 28 of the Hindu Marriage Act, 1955 read with Section 19 of the Family Courts Act, 1984 on behalf of the appellant (husband) against the impugned judgment and order dated 24.12.2019 passed by the Family Court, Dwarka, wherein the petition under Section 12 of the Hindu Marriage Act filed by the appellant was dismissed.

The brief factual matrix as per the appellant, necessitating filing of the petition under Section 12 of the Hindu Marriage Act and the present appeal, are as under:
The marriage between the appellant and the respondent was solemnized on 10.12.2005. As per the appellant, the marriage between the appellant and the respondent was the outcome of a calculated fraud that was perpetrated by the respondent and her family members as they chose not to disclose a vital and crucial fact regarding the respondent”s mental health/ailment.
According to the appellant, the respondent was, before the marriage, and during the days that she stayed with the appellant, suffering from Acute Schizophrenia. The respondent behaved in a very unusual manner after her marriage in the matrimonial home, as well as during their honeymoon.
Consequently, the appellant took the respondent to Dr. Inderjeet Sharma in January, 2006, who after examining her referred her to GB Pant hospital, where Dr. Rajiv Mehta examined the respondent and prescribed certain medicines. Finding no change in respondent”s behaviour, the appellant took her to a neuro surgeon at Institute of Human Behaviour and Allied Sciences, Delhi where the respondent was examined again and Dr. Harcharan Singh prescribed her medicines.
On 11.02.2006, the appellant took the respondent to Hindu Rao Hospital at Delhi, where Dr. Jitender Kumar examined the respondent. As per the appellant, after meeting the said doctor respondent shouted”isi doctor ne mujhe pehle bhi davai di hai.”
Since the appellant did not find any improvement in the mental health of the respondent, he also took her to All India Institute of Medical Sciences, where Dr. Mamta Sood, Neuro Psychiatrist examined her and prescribed her few medicines. As per Dr. Mamta Sood, the respondent was suffering from Acute Schizophrenia. The appellant thereafter questioned the respondent”s parents and narrated the mental condition of the respondent.
The appellant also averred in the petition regarding the mother and aunt of the respondent mixing something in the eatables. This is neither relevant, nor germane, to the issue in controversy and hence not adverted to, by us.
The appellant along with the other family members questioned the father of the Respondent, and it was then that the father of the respondent took the respondent with him to her parental home (after 9 weeks of marriage) on 17.02.2006 and, since then the respondent is living with her parents in their house. The appellant also averred that the marriage between the appellant and the respondent was not consummated.
The respondent filed her written statement wherein she denied that the marriage between the appellant and the respondent was not consummated. The respondent averred that she has never suffered from any mental or physical ailment, but she did suffer headaches during her college days due to which her studies were discontinued, and the said fact was clearly told to the appellant, the mediator, and all other persons concerned.
She further averred that the appellant, his family members, friends and relatives had met the respondent prior to marriage many a times, and there were numerous telephonic calls. Therefore, there was no question of respondent suffering from any mental ailment, much less, Schizophrenia either prior to the marriage or during subsistence of the marriage.
She further stated that the appellant met her prior to the ring ceremony with his family members at Lakshminarayana (Birla) Mandir, where he spent around an hour exclusively with the respondent. After the ring ceremony, the appellant along with his sister-in-law had discussions with the respondent at Pizza Hut, Netaji Subhash Marg, New Delhi. The respondent has denied that appellant had ever taken her to any doctor, or that she was examined by any doctor, or got any treatment.
The respondent had also filed a petition under Section 9 of the Hindu Marriage Act, seeking Restitution of Conjugal Rights against the appellant which, vide order dated 30.10.2009 of the Family Court, had been clubbed with the divorce petition.
In order to prove his case before the family court, the appellant examined himself as PW-1, and has exhibited medical slip dated 17.01.2006 (exhibit PW-1/B), Out Patient Cards dated 03.02.2006, 11.02.2006 and 07.02.2006 as exhibit PW-1/C, PW-1/D and PW-1/E respectively, and copy of police complaint dated 22.02.2006 as exihibit PW-1/G. Petitioner examined his father Sh. Bal Kishan Aggarwal as PW-2, Smt. Manju Aggarwal, his mother as PW-3, and Sh. Bharat Aggarwal, his brother as PW-4, who reiterated the averments made in the petition. The appellant also examined PW-5 Dr. Rajiv Mehta, PW-6 Dr. Inderjeet Sharma, PW-7 Dr. Mamta Sood and PW-8 Dr. Jitender Kumar. All PWs were extensively cross examined by learned Counsel for the respondent.
The respondent, on the other hand, examined herself as RW-1 and exhibited the Film and Report of CT Scan as exhibit RW-1/A, driving licence as exhibit RW-1/B, public notice dated 22.07.2006 in Times of India newspaper as exhibit RW-1/C, information under RTI Act dated 01.02.2006, 03.02.2006 and 11.02.2006 as exhibits PW-1/D and PW-1/E
The respondent examined her mother RW-2 Smt. Neena Rani Goel, and her father PW-3 Sh. Mohan Lal. The witnesses have reiterated the averments made in the written statement in their examination in chief, and were also cross-examined by learned Counsel for the appellant.
The Family Court after going through the documents, pleadings and evidence and analysing the same, has come to the conclusion that the petition must fail for the following reasons:
a) That neither the appellant, nor any of his witnesses have been able to conclusively prove that the respondent, prior to her marriage, was suffering from Schizophrenia. According to the Family Judge, the petitioner has failed to prove that his consent to marriage was obtained by playing fraud and suppressing material fact concerning the illness of the respondent.
b) The Family Court also relied upon the behaviour of the Respondent during cross-examination to hold “the conduct of the respondent exhibited by her during cross-examination does not show that she was not a normal lady or was suffering from schizophrenia or any other mental disorder. She understood all the questions put to her during cross-examination and answered these questions appropriately.”
c) Another factor which weighed with the Family Court was that the appellant, as well as his family members, had extensively interacted with the respondent for 4 months after the Sagai. The PW-4 Bharat Aggarwal (brother of the Appellant) also admitted that in the God Bharai ceremony, the respondent even danced and behaved properly and there was nothing unusual about the behaviour of the Respondent.
d) The allegations of respondent”s behaviour in Goa and other small instances at the house have also been considered by the Family Court in detail. However, the same are not relevant for the purpose of adjudication in the present appeal, for the reasons disclosed by us in subsequent paragraphs.
e) The Family Court further held that the medical prescription exhibit PW-1/C and PW-1/E have remained unsubstantiated and unproved, as the appellant has not examined any of the doctor from IHBAS Hospital. The Appellant, though examined PW-7 Dr. Mamta Sood-to prove medical prescription issued by AIIMS Ex. PW-1/E, PW-7 deposed that Ex. PW-1/E does not bear her hand writing anywhere. As regards PW-6 Dr. Indrajeet Sharma, he deposed that the medicines prescribed by him could be given for various purposes, including anxiety and did not know the patient personally, and the medical prescription did not bear the personal identification of the Respondent on the prescription. The testimony of PW-5 Dr. Rajiv Mehta was not relied upon by the Family Court, because no separate test was conducted for diagnosing the respondent provisionally.
f) What weighed with the Family Court while passing the impugned order, dismissing the petition, was also that during the span of less than one month, the appellant had taken respondent to 5 different doctors of different hospitals. The Family Court also came to the conclusion that the appellant did not wait to see the result of the treatment given by various doctors to the respondent as per prescription, and had taken respondent to one hospital after another for preparation of prescription and no medicine was given to the respondent. The Family Court was of the view that “it appears that the petitioner was only getting prepared these medical prescriptions to show that respondent was suffering with some ailment without any treatment being provided to the respondent.”
g) The Family Court also was of the view that the appellant failed to prove on record that respondent was suffering from Schizophrenia or any other ailment prior to her marriage. Hence, the petition was dismissed.
In appeal, detailed arguments were addressed by Mr. Asutosh Lohia, learned Counsel for the appellant and Mr. Mohan Lal, learned Counsel for the respondent, who is also her father.
The primary argument of the appellant was that the accumulated evidence supports the finding that the Respondent was/is suffering from “F-20 Hebephrenia”. He has referred to multiple prescriptions that diagnosed the Respondent with either Schizophrenia, or F-20-Hebephrenia. To further make his case, learned counsel for the appellant took us through the medical literature on Schizophrenia and Hebephrenia, as well as the literature on the medicines prescribed. He also relied on the statements of Dr. Inderjeet Sharma PW-6, Dr. Rajiv Mehta PW-5 and Dr. Mamta Sood PW-7.
The testimonies of doctors and medicines prescribed by them, relied upon by the Appellant are as under:
a) PW-5 Dr. Rajiv Mehta testified that the prescription dated 28.01.2006, Ex. PW-1/B is in his handwriting. He stated that the provisional diagnosis of the patient Priyanka was pertaining to Schizophrenia, and the patient was called on three occasions.
b) PW-8 Dr. Jitender Kumar, Psychiatry Department, Hindu Rao Hospital, Delhi proved the OPD card, Ex. PW-1/D and stated that the said exhibit was prepared by him and bears his signature at point “A”. He further stated that he had examined the patient and prescribed the medicines mentioned in OPD card, EX PW-1/D. As per the prescription, the Respondent was prescribed medicines Arip MT 15 and Resperidone, which are listed as Antipsychotic Drugs. She was also prescribed Risperidone including Sizodon, also in another prescription. Respondent was even prescribed Pacitane and Phenargan, which are anticholinergic drugs used to prevent drug-induced parkinsonism. She was also prescribed Bexol-used for treating Parkinsons disease.
c) He also relied on the Exhibit PW-1/E and the testimony of PW-7 Dr. Mamta Sood (a psychiatrist) of AIIMS, who, after examining the Respondent”s behaviour opined that the Respondent is suffering from Hebephrenia, and prescribed some medicines for the same.
The Appellant has relied on medical literature and provided a table, classifying the uses of the medicines. Following is the table


Brand name	Chemical Salt/Composition	Treatment Of
(i)	Arip MT 15	Aripiprazole	Schizophrenia
(ii)	Sizodon Plus	Risperidone	Schizophrenia
(iii)	Parkin Plus	Trifluoperazine + Trihexyphenidyl	Schizophrenia and Parkinson
(iv)	Risdone	Risperidone	Schizophrenia
(v)	Bexol	Trihexyphenidyl	Parkinson
(vi)	Respid	Risperidone	Schizophrenia
(vii)	Pacitane	Trihexyphenidyl	Parkinson

Learned counsel, by relying on medical literature, has shown that Risperidone, Trifluoperazine, and Aripiprazole are Antipsychotic Drugs. The Chapter on “Drugs Used in Mental Illness: Antipsychotic and Antimanic Drugs” in the medical text states that “Antipsychotic (neuroleptic, ataractic, major tranquillizer) useful in all types of functional psychosis, especially schizophrenia.” [K.D. Tripathi, Essentials of Medical Pharmacology (6th Edition, 2008) Jaypee Brothers Medical (P) Ltd.]
Learned Counsel for the appellant has submitted that courts are ill-equipped to weigh, analyse and arrive at definite findings of mental condition/illness of a litigant on their own. Hence, he has argued that the Respondent must be examined by a Medical Board of experts in the field, to ascertain the medical condition of the respondent in view of the rival claims made by the appellant and respondent. Learned counsel for the appellant has relied on the judgment in Sharda v. Dharmpal MANU/SC/0260/2003to submit that that the Court can always direct examination by a medical expert, to call for the medical opinion to arrive at the truth.
Mr. Lohia has submitted that even today, he is ready that the respondent be examined by a Medical Board to ascertain the mental condition of the respondent as to:
a) Whether she is suffering from Schizophrenia? and;
b) Since how long she has been suffering from the said ailment, if at all.
In addition the appellant has also submitted:
That the parties have not stayed together for longer than two months, and the marriage is not consummated.
They have been separated for 16 years.

iii. The Respondent admitted to attempting suicide in her testimony.

She also admitted to getting headaches and ear infections.
In the light of the judgment in Dharam Pal (supra), we asked Mr. Mohan Lal whether the respondent would be ready and willing to subject herself to examination by a Medical Board of specialists. The learned Counsel for the respondent flatly refused and said that subjecting the respondent to a Medical Board would amount to cruelty on her.
The learned Counsel for the respondent submitted that the appellant never took the respondent to any doctor, as none of the doctors have identified the respondent. He further submitted that there is not a single purchase of medicine shown by the appellant, and there is no justification as to why the appellant would take the respondent to 5 doctors within a period of 1 month, and not wait for the results of the medication.
Learned Counsel has refuted that the respondent was suffering from any mental disorder prior to her marriage; at the time of her marriage, and; thereafter. He has supported the findings returned in the impugned judgment.
We have heard learned Counsel for the parties and have gone through the documents.
At the outset, we may state that Judges are not medical professionals or experts, and acquire limited knowledge based on the arguments of the parties, and the medical literature produced before them; the testimonies of expert witnesses produced in Court, and; the submissions advanced before the Court. The Courts, to be able to decide such issues, needs expert opinion from credible persons in the field. The parties are also entitled to grant of opportunity to either support, or challenge the opinion that the experts may give after examination of the person concerned, and all other relevant materials. However, what weighs with us, at the outset is the denial of the respondent to subject herself to evaluation of her condition by an independent Medical Board to be appointed by the Court. This conduct itself raises a presumption against the respondent. The judgment of Dharampal (Supra) is clear and unequivocal in this regard. The relevant extract from Dharampal (Supra) read as under:

“9 .Clause 2(b) of Section 5 provides for one of the conditions for a valid Hindu marriage that neither party must be suffering from unsoundness of mind, mental disorder or insanity. In terms of Section 12(1)(b) of the Act a marriage may be held to be voidable if the other party was suffering from mental disorder or insanity. Section 13(1)(iii) of the Act provides that a party to the marriage may present a petition for dissolution of marriage by a decree of divorce inter alia on the ground that the other party has been incurably of unsound mind and has been suffering continuously or intermittently from mental disorder of such a kind that the petitioner cannot reasonably be expected to live with the respondent. It is beyond any cavil that a marriage in contravention of the aforementioned provisions of the Hindu Marriage Act is per se not void but is merely voidable.

10 .It is trite law that for the purpose of grant of a decree of divorce what is necessary is that the petitioner must establish that unsoundness of mind of the respondent is incurable or his/her mental disorder is of such a kind and to such an extent that he cannot reasonably be expected to live with his/her spouse. Medical testimony for arriving at such finding although may not be imperative but undoubtedly would be of considerable assistance to the court. We may, however, hasten to add that such medical testimony being the evidence of experts would not leave the court from the obligation of satisfying itself on the point in issue beyond reasonable doubt. Relevance of a medical evidence, therefore, cannot be disputed.

Having regard to the complexity of the situation, the doctor’s opinion may be of utmost importance for granting or rejecting a prayer for a decree of divorce. The question is as to whether a mental disorder is curable can be subject matter of determination of by a Court of Law having regard to the expert medical opinion and particularly the ongoing development in the scientific and medical research in this direction.
However, the Court has been empowered to issue such a direction in a civillitigation.
Yet again the primary duty of a Court is to see that truth is arrived at. A party to a civil litigation, it is axiomatic, is not entitled to constitutional protection under Article 20 of the Constitution of India. Thus, the Civil Court although may not have any specific provisions in the Code of Civil Procedure and the Evidence Act, has an inherent power in terms of Section 151 of the Code of Civil Procedure to pass all orders for doing complete justice to the parties to the suit.
In certain cases medical examination by the experts in the field may not only found to be leading to truth of the matter but may also lead to removal of misunderstanding between the parties. It may bring the parties to terms.
Having regard to development in medicinal technology, it is possible to find out that what was presumed to be a mental disorder of a spouse is not really so.
In matrimonial disputes, the court has also a conciliatory role to play- even for the said purpose if may require expert advice.
Under Section 75(e) of Code of Civil Procedure and Order 26 Rule 10A the Civil Court has the requisite power to issue a direction to hold a scientific, technical or expert investigation.
It was held that nobody can be forced to go to a mental hospital to undergo a medical treatment and it would be for the Court to draw an adverse inference against him for not doing so.

51..The prime concern of the Court is to find out as to whether a person who is said to be mentally ill could defend himself properly or not. Determination of such an issue although may have some relevance with the determination of the issue in the lis, nonetheless, the Court cannot be said to be wholly powerless in this behalf. Furthermore, it is one thing to say that a person would be subjected to test which would invade his right of privacy and may in some case amount to battery; but it is another thing to say that a party may be asked to submit himself to a psychiatrist or a psychoanalyst so as to enable the Court to arrive at a just conclusion. Whether the party to the marriage requires a treatment or not can be found out only in the event, he is examined by a properly qualified Psychiatrist. For the said purpose, it may not be necessary to submit himself to any blood test or other pathological tests.

53.Keeping in view of the fact that in a case of mental illness the Court has adequate power to examine the party or get him examined by a qualified doctor, we are of the opinion that in an appropriate case the Court may take recourse to such a procedure even at the instance of the party to the lis.

Furthermore, the Court must be held to have the requisite power even under Section 151 of Code of Civil Procedure to issue such direction either suo motu or otherwise which, according to him, would lead to the truth.
If despite an order passed by the Court, a person refuses to submit himself to such medical examination, a strong case for drawing an adverse inference would be made out Section 114 of the Indian Evidence Act also enables a Court to draw an adverse inference if the party does not produce the relevant evidences in his power an possession.
So viewed, the implicit power of a court to direct medical examination of a party to a matrimonial litigation in a case of this nature cannot beheld to be violative of one’s right of privacy.
To sum up, our conclusions are
A matrimonial court has the power to order a person to undergo medical test.
Passing of such an order by the court would not be in violation of the right to personal liberty under Article 21 of the Indian Constitution.
However, the Court should exercise such a power if the applicant has a strong prima facie case and there is sufficient material before the Court. If despite the order of the court, the respondent refuses to submit himself to medical examination, the court will be entitled to draw an adverse inference against him.” (emphasis supplied)
The outright refusal of the respondent to undergo any medical examination, prevents the court arriving at the truth. It has been held by the Supreme Court in Kollam Chandra Sekhar v. Kollam Padma Latha (2014) 1 SCC 225by relying on the testimony of a doctor that Schizophrenia “is a treatable, manageable disease, which can be put on a par with hypertension and diabetes.” However, the same requires determination by a doctor, and in Dharam Pal (Supra) the court has observed that

“..but it is another thing to say that a party may be asked to submit himself to a psychiatrist or a psychoanalyst so as to enable the Court to arrive at a just conclusion. Whether the party to the marriage requires a treatment or not can be found out only in the event, he is examined by a properly qualified Psychiatrist.” Therefore, in such circumstance determination of truth is an important step for us to enable making of a fair decision.

In Kollam Chandra Sekhar (Supra), the Supreme Court has aptly described the institution of marriage, wherein the court has observed:

“42. Marriage is highly revered in India and we are a nation that prides itself on the strong foundation of our marriages, come hell or high water, rain or sunshine. Life is made up of good times and bad, and the bad times can bring with it terrible illnesses and extreme hardships. The partners in a marriage must weather these storms and embrace the sunshine with equanimity. Any person may have bad health, this is not their fault and most times, it is not within their control, as in the present case, the respondent was unwell and was taking treatment for the same. The illness had its fair share of problems…”

Marriage is not made of only happy memories and good times, and two people in a marriage have to face challenges and weather the storm together. It is not easy to live with a partner who has mental health issues, and such ailments come with their own challenges for the person facing the problem, and even more so for the spouse. There needs to be an understanding of the problems in a marriage, and communication between the partners especially when one of the two partners in a marriage is facing challenges of their own. Treatment of any mental ailment requires acceptance of the same, not only by the family members but, most importantly, by the person suffering therefrom. The same has been enunciated by the Department of Health, Australia Government where it has been observed that, “.Acceptance is acknowledged to be an important step in developing effective illness management strategies and working effectively with mental health services and complying with medications and treatments (Van Meijel et al 2002a, Van Meijel et al 2002b). This can be a difficult process, however, and takes time (Nemec & Taylor 1990). Acceptance is unlikely to occur immediately after the first episode; at this time, most people want to return to their previous self and previous life and are very reluctant to accept that they may have ongoing problems with their mental health.” [Rickwood D (2006). Pathways of Recovery: Preventing Further Episodes of Mental Illness (Monograph). Commonwealth of Australia, Canberra. (citations omitted)]
It is true that the medical opinion in the present case is not conclusive. However, the evidence of Dr. Rajiv Mehta, read with the evidence Dr. Inderjeet Sharma, coupled with the documents exhibited by them seems to suggest that Respondent was suffering from schizophrenia. In the cross-examination, the doctor opined that the provisional diagnosis of the patient was on the basis of history and the interview of the patient. PW-5 further deposed in his prescription that the patient was suffering from F-20.
Further, generally, tests are not conducted for Schizophrenia. Pertinently, the respondent herself admitted that even in her college days she used to have headache and the said headaches were of such severity, that they interfered with her education, as a result of which, the respondent could not complete her college. There is no explanation or reason, as to what was the nature of those headaches; what caused those headaches; and; what was the treatment given to the respondent for those headaches.
A combined reading of the evidence as well as the admission of the respondent, even though, may not conclusively prove that the respondent was suffering from Schizophrenia/Hebephrenia- F-20 prior to her marriage, at the time of her marriage, and; subsequent to her marriage, but definitely raises a serious doubt about the mental health of the respondent, and points to the possibility of the appellant”s allegations in that regard being true.
In these circumstances, the judgment of Sharda v. Dharampal is a clincher, as far as we are concerned. The Counsel for the appellant on one hand voluntarily made a statement that, at his cost and expense, the respondent be evaluated by a Medical Board to arrive at the truth of the mental health of the respondent. The appellant had also moved an application before the Family Court for evaluation of the respondent by a Medical Board. The prayer of the application reads as under:

“that this Honble Court be pleased to issue necessary directions in the matter to enable the respondent being referred to some medical board constituted by this Honble Court which may keep the respondent in observation for such period as may be necessary to determine th medical condition or the respondent and also the existence or otherwise of such condition of the respondents AND to pass such other orders/directions which this Honble Court may deem fit and proper.”

The said application was dismissed by a cryptic orderby the Family Court on date 27.08.2009 observing the following:

“After considering the pleadings of the parties, I am of the opinion that parties have to stand at their own legs in proving their case. It is the case of the respondent/husband that petitioner/wife is suffering from Schizophrenia and in order to prove the case, it is the duty of the respondent/husband to lead evidence and the court cannot provide assistance to the respondent/husband to procure the evidence. The application being devoid of merit is dismissed.”

As noticed above, the said plea was again made while this appeal was pending. The Counsel for the respondent flatly refused this proposal.
In Sharda v. Dharampal, the Courtheld as under:

“85. So viewed, the implicit power of a court to direct medical examination of a party to a matrimonial litigation in a case of this nature cannot beheld to be violative of one’s right of privacy. 86. To sum up, our conclusions are

A matrimonial court has the power to order a person to undergo medical test.
Passing of such an order by the court would not be in violation of the right to personal liberty under Article 21 of the Indian Constitution.
However, the Court should exercise such a power if the applicant has a strong prima facie case and there is sufficient material before the Court. If despite the order of the court, the respondent refuses to submit himself to medical examination, the court will be entitled to draw an adverse inference against him.”
Thus, the Family Court fell in error in rejecting the appellant”s application. The approach of the Family Court that the appellant had to fend for himself, and he could not seek a direction from the Court for medical examination of the respondent was erroneous. It is not that this direction was sought by the appellant without any foundation or basis. The appellant had raised a plea that the respondent was suffering from Schizophrenia from day one. The appellant had shown the respondent to several specialists, and the medications prescribed show that they were relevant for treatment of Schizophrenia. The appellant also produced the medical doctors/ specialists and exhibited their prescriptions. The parties lived together for hardly any period, as the respondent was taken away by her father after about nine weeks of marriage from the matrimonial home. The evidence with regard to the respondent”s medical condition which related to her mental health, could possibly not have been garnered by the appellant without co-operation of the respondent. Only upon medical examination of the respondent, it could be established, with definiteness whether, or not, she is suffering from Schizophrenia, even though, there were pointers in that direction.
Pertinently, the Respondent could not establish any reason as to why, so early in the marriage, the parties separated, when according to the respondent, there were no serious issues in the relationship. The fact that she sought Restitution of Conjugal Rights itself shows that so far as she was concerned, she had no serious complaints with the appellant; or the relationship.
In the aforesaid circumstances, in our view, the Family Court was duty bound to direct the medical examination of the respondent. The appellant could not have been left to gather evidence of the respondent”s mental condition on his own.
The above factual matrix leads to an irrefutable assumption that all was not well with the respondent and she has been suffering from some disorder which she did not want to come out. We may also draw an analogy from section 114 illustration (h) of the Evidence Act, 1872. Section 114 of the Indian Evidence Act reads as under:

“Court may presume existence of certain facts. The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case.”

Illustration (h) reads as under:

“That if a man refuses to answer a question which he is not compelled to answer by law, the answer, if given, would be unfavourable to him”.

Carrying the illustration (h) further, and, in the light of the judgment of Dharampal (Supra), we can conclude that examination by medical specialist(s), if undertaken, would have been unfavourable to the respondent. The refusal by the respondent to undergo medical examination by the Medical Board of experts leads to the inference that she was not prepared to face the Medical Board as that could have exposed the condition of her mental well being, and would have established the allegation made by the appellant that she was suffering from Schizophrenia. Why else, such a spousewho claims to be not suffering from any mental ailment who has preferred a petition to seek restitution of conjugal rights, and expresses her desire to live with the appellant husband, not undergo such medical examination?
The only course that commends itself, in the facts of the case, is to call the opinion of an expert Medical Board. While the burden of proof is on the party alleging a claim, the conduct and cooperation of the other party is something to be taken a note of. The outright refusal by learned counsel of the Respondent to subject the Respondent to such medical examination, leaves the situation at a stalemate and prevents us from arriving at the definite truth. The Respondent has scuttled the effort of the court to arrive at a definite finding of truth. The only way of conclusively determining the mental health of the Respondent is by subjecting the Respondent to an examination by an expert Medical Board. The appellant has significantly discharged the onus by leading cogent evidence, and raise a preponderance of probability, that the Respondent is suffering from Schizophrenia.
For the abovesaid reasons, we draw an adverse inference against the Respondent that she is suffering from Schizophrenia.
Section 12 of the Hindu Marriage Act deals with voidable marriages. A Hindu marriage shall be voidable and may be annulled by a decree of nullity, inter alia, on the ground that the marriage is in contravention of the condition specified in Clause (ii) of Section 5. Section 5 Clause (ii), insofar as it is relevant, states that a marriage may be solemnized between two Hindus, inter alia, if:

“(ii) at the time of marriage, neither party

(a) is incapable of giving a valid consent to it in consequence of unsoundness of mind; or

(b) though capable of giving a valid consent, has been suffering from mental disorder of such a kind or to such an extent as to be unfit for marriage and the procreation of children; or

The fact that the parties could not live together beyond nine weeks itself shows that the mental disorder suffered by the respondent is of a kind, and to such an extent as to be unfit for marriage and the procreation of children. It is not the case of the respondent that either of the conditions enumerated in Section 12(2)(a)(i), or (ii) exists in the present case, which would have debarred the appellant from seeking annulment of marriage on the ground contained in Section 12(1)(b) of the Hindu Marriage Act. That is not the defence set up by her, or established by her. The failure on the part of the respondent to disclose her mental disorder before her marriage with the appellant as alleged by him, constituted a fraud perpetrated upon the appellant. Apart from stating that the parties had met a few times before the marriage, the respondent has not specifically averred, or established, that the appellant was made aware of the mental disorder suffered by the respondent, which was passed-off by her as mere “headaches”. Headachesby themselves are not a disease. They are only symptoms of a disease. The Respondent does not state what caused her such serious and frequent headaches, which debilitated her from completing her studies.
We are, therefore, inclined to allow the present appeal and annul the marriage between the appellant and the respondent on the ground contained in Section 12(1)(b) of the Hindu Marriage Act.
We may also observe that the learned counsel for the respondent is the father of the respondent, and it appears that his objectivity in dealing with the matter has been overshadowed by his love for his daughter, i.e. the respondent, which is only natural and to be expected. However, in the process, unfortunately, the life of the appellant has been ruined and he has remained stuck in this relationship for 16 years without any resolution. In the most important years of his life, when the appellant would have, otherwise, enjoyed marital and conjugal bliss and satisfaction, he has had to suffer due to the obstinacy displayed by not only the respondent, but even her father, who appears to have been calling the shots in relation to the matrimonial dispute raised by the appellant. In these circumstances, we grant token costs to the appellant of Rs. 10,000/- .

Posted on 2nd December 20213rd December 2021 by rajatbindal5gmailcom — Leave a comment

No Operation theatre was available at the sudden reach of accidental patient. No medical negligence

Rated 5 out of 5

SUPREME COURT OF INDIA

DIVISION BENCH

BOMBAY HOSPITAL & MEDICAL RESEARCH CENTRE — Appellant

Vs.

ASHA JAISWAL AND OTHERS — Respondent

( Before : Hemant Gupta and V. Ramasubramanian, JJ. )

Civil Appeal No. 1658 of 2010 with Civil Appeal No. 2322 of 2010

Decided on : 30-11-2021

A. Medical negligence – No fault can be attached to the Hospital if the operation theatres were occupied when the patient was taken for surgery. Operation theatres cannot be presumed to be available at all times – Therefore, non-availability of an emergency operation theatre during the period when surgeries were being performed on other patients is not a valid ground to hold the Hospital negligent in any manner.

B. Medical negligence – Mere fact that the Doctor had gone abroad cannot lead to an inference of medical negligence as the patient was admitted in a hospital having specialists in multi-faculties.

C. Medical negligence – Where the patient was in serious condition impending gangrene even before admission to the Hospital but even after surgery and re-exploration, if the patient does not survive, the fault cannot be fastened on the doctors as a case of medical negligence – It is too much to expect from a doctor to remain on the bed side of the patient throughout his stay in the hospital which was being expected by the complainant here. A doctor is expected to provide reasonable care which is not proved to be lacking in any manner in the present case.

D. Medical negligence – If the operation theatres were occupied at the time when the operation of the patient was contemplated, it cannot be said that there is a negligence on the part of the Hospital – A team of specialist doctors was available and also have attended to the patient but unfortunately nature had the last word and the patient breathed his last – Family may not have coped with the loss of their loved one, but the Hospital and the Doctor cannot be blamed as they provided the requisite care at all given times – No doctor can assure life to his patient but can only attempt to treat his patient to the best of his ability which was being done in the present case as well – Findings recorded by the Commission holding the Hospital and the Doctor guilty of medical negligence are not sustainable in law.

Counsel for Appearing Parties

Ms. Bina Madhavan, Advocate, Ms. Rao Vishwaja, Advocate, for M/S. Lawyer S Knit & Co, Advocate, Ms. Nandini Gore, Advocate, Mr. Karanveer Singh Anand, Advocate, Ms. Pracheta Kar, Advocate, Mr. Aditya Sidhra, Advocate, Mr. Nadeem Afroz, Advocate, for M/s. Karanjawala & Co., Mr. Anil Kumar, Advocate, Mr. Kamal Mohan Gupta, Advocate, Mr. Ashwani Kumar, Advocate, Counsel for the Parties.

Cases Referred

Arun Kumar Mangliky. Chirayu Health and Medicare Private Limited and Anr., (2019) 7 SCC 401
Barkway v. South Wales Transport Co. [(1950) 1 All ER 392, 399]
Burke v. Manchester, Sheffield & Lincolnshire Rail Co. [(1870) 22 LJ 442]
C.P. Sreekumar (Dr.), MS (Ortho) v. S. Ramanujam, (2009) 7 SCC 130
Cream v. Smith [(1961) 8 AER 349]
Dr. Harish Kumar Khurana v. Joginder Singh & Others, (2021) SCC Online SC 673
Iffco Tokio General Insurance Company Limited v. Pearl Beverages Limited, (2021) 7 SCC 704
Jacob Mathew v. State of Punjab and Anr., (2005) 6 SCC 1
Kusum Sharma and Others v. Batra Hospital and Medical Research Centre and Others, (2010) 3 SCC 480
Martin F. D ‘Souza v. Mohd. Ishfaq, (2009) 3 SCC 1
Moore v. R. Fox & Sons [(1956) 1 QB 596 : (1956) 1 All ER 182]
Richley v. Faull [(1965) 1 WLR 1454 : (1965) 3 All ER 109]
Russel v. London & South Western Railway Co, (1908) 24 TLR 548
Syad Akbar v. State of Karnataka, (1980) 1 SCC 30
Whitehouse v. Jordan and Anr, [1981] 1 Weekly Law Reports 246

JUDGMENT

Hemant Gupta, J. – The present appeals are directed against an order passed by the National Consumer Disputes Redressal Commission[1] on 06.01.2010 against the appellants i.e., Bombay Hospital & Medical Research Centre[2] and Dr. C. Anand Somaya[3], directing to pay a sum of Rs. 14,18,491/- along with interest @ 9% p.a. from the date of filing of the complaint till the date of payment.

[1] For short, the ‘Commission’

]2] For short, the ‘Hospital’

[3] For short, the ‘Doctor’

2. The complaint was filed before the Commission by the legal heirs[4] of the deceased – patient Dinesh Jaiswal[5], alleging medical negligence on the part of the Hospital and the Doctor in treating the patient. The patient was admitted to the Hospital on 22.04.1998 and breathed his last on 12.06.1998. The Hospital charged a sum of Rs. 4,08,800/- for the treatment of the patient during the period of his admission in the Hospital. The said amount is included in and is part of the amount of compensation awarded against the appellants herein.

[4] For short, the ‘Complainant’

[5] For short, the ‘patient’

3. The patient was taking treatment since 1990 for having difficulties in walking due to the pain and discomfort in legs. For his complaint of inability to walk, a Colour Doppler Test was conducted on 13.04.1998 at Khemuka X-Ray & Ultrasound Clinic, Nagpur which detected the following:

“Aneurismal dilatation of the lower abdominal aorta just above bifurcation is seen. The aneurism measures 5.4 x 2.6 in its maximum dimensions.

Irregular thrombus is seen within the aneurism on colour flow studies.

Prostate is normal in echo – pattern and measures 4 x 3 x 3 cms. Prostatic capsule is intact. Urinary bladder is normal in capacity and contour. Post void residual urine is not significant.

Impression: Mild hepatomegaly with aneurism of lower abdominal aorta just above the bifurcation.”

4. Dr. K.G. Deshpande Memorial Center, Nagpur was consulted by the patient on 15.04.1998 and Dr. Deshpande diagnosed the following:

“A case of Abd Aortic Aneurysum

Involvement on left side

with Left PVB (Embolism)

H/O Trauma 1983,

Pain Left LL 1990 S/O Embolism

Vascular Duplex Seen S/O Large Abd. A. Aneurysum

6*3*5.1 cm

Adv- Urgent Surgical repair of the aneurysum”

5. After diagnosis, Dr. Deshpande referred the patient to the appellant-Doctor who is a Vascular Surgeon. The patient consulted the appellant-Doctor on 21.4.1998. The Doctor ordered the admission of the patient as an urgent case of aorta aneurysum. On 22.4.1998, the Doctor advised urgent DSA/CAT Scan [Digital Sub-Traction Angiography and Computerized Axial Tomography] and surgery after noticing the following physical conditions:

“A 42 years old male with aorta pain left lower limb and right leg below knee. Gradual Claudication

BP – 100/80

Ischaemic changes both lower limbs. Seen with impending Gangrene

Both legs left muscles are tested.

………………………..”

6. The Doctor after examining the patient recorded that there were ischemic changes in both lower limbs and also noted an impending gangrene. Subsequent to the pre-operative preparations, surgery was conducted on 23.04.1998 by a team of surgeons including Dr. Partha and Dr. Bindra, led by the appellant-Doctor. The operation notes read as thus:

“On inspection there was a huge aneurysum on the latral aspect on left side arising infra renal.

It was densely adherent to the surrounding structure. The aneurysum was directed out. The tape was passed around the left Renal artery/vein for retraction. A tape was passed around the aorta just below the renal artery and above the aneurysum. Both the common iliac arteries were exposed. Tapes were passed around both the iliac arteries.

After achieving proper exposure/slinging around all the vessels. The aorta was iron clamped just infra-renally. The aneurysum opened out. The aorta transected and both illiacs transected. (A PTFE ‘Y’ Limb Graft) was sutured in place. The short main limb to the aorta using continuous prolure and both the limbs of the graft were sutured to the common iliacs end to end anastomosis on right side. After checking the flow in the graft after suture the upper end the lower anastomosis were done.

On the left side, the side of the graft was sutured the end of the common iliac. The limb of the graft further brought down through a tunnel to the femoral artery and the end of the graft sutured to the side of the femoral artery.

After achieving proper haemostasis and checking the pulsation.

Intra-operatively, the abdomen closed using drainage tubes.

The patient was later shifted to recovery room on ventilator with stable vital signs.”

7. It is the case of the complainant that on 24.4.1998 at about 4 am, that is the night after surgery, the nurse who was attending the patient observed that the pulsation of the patient had become feeble and body temperature was low and the lower limbs had gone cold. The relatives were informed at about 7 a.m. that the patient was unconscious, legs were cold with no pulsation. The complainant further alleged that the nurse had informed the Doctor at 4 am but he came only at 9.30 a.m. The patient upon assessment by the Doctor was directed to get second DSA test but DSA machine was out of order. Hence, the Doctor advised angiography but the patient was made to wait for both DSA test as well as for angiography. One Dr. B.K. Goyal examined the patient and reported that the patient had probably developed block of abdominal aorta.

8. The angiography conducted at 12.30 pm on 24.4.1998 showed a block (clot) at the graft due to which the blood supply to the lower limbs had totally stopped. The complainant contended that the earlier surgery was not performed correctly and there was negligence in conducting the same. A decision was taken to re-explore the earlier surgery done at about 3:30 pm but since all the four operation theatres were occupied, he could only be taken to the operation theatre for re-grafting at 5.30 p.m. As there was no pulsation in the graft and there was clot in the graft extending into both limbs of the graft, a fresh graft was sutured and the patient was shifted to recovery room and put on ventilator.

9. It was contended by the Hospital that the patient was in the care of qualified doctors such as Dr. Nemish Shah, Dr. J. A. Pachore, Dr. A.L. Kripalani, Dr. Partha, Dr. H.S. Bindra and many others throughout his course of admission and no stone was left unturned to ascertain the complications and treat the same. Various specialist doctors were treating the patient and medicines/treatment was timely regulated and changed as and when required on a daily basis. Regular daily dialysis, dressing of wounds etc. were also done. However, unfortunately, despite the best efforts of the qualified doctors, the patient did not respond to the treatment and passed away on 12.06.1998.

10. The complainant in the complaint enumerated the facts suggesting negligence and deficiency of service on the part of the appellants. The averments made by the complainant and the corresponding reply by the Doctor is extracted herein under:

“34. In all cases of grafting the patient is kept under close observation to find out whether blood is flowing normally. In case there is stoppage or lack of flow immediate action is taken to control the situation because lack of blood is certain to rupture and deaden the muscles. The tissues cannot survive without blood flow. But in this case after the patient was taken to recovery room he was not examined by any doctor. The attending nurse observed at 4.30 a.m. on 24.4.98 that lower limbs had become cold and did inform the doctors. The doctors were called in writing at 8 a.m. but Dr. Somaya came at 9.30 a.m. This time gap was enough to rupture the muscles. The process is irreversible. It cannot be corrected. Timely medical care could have saved the life of the complainant.	“16. Without prejudice to the above and with reference to para 34 of the complaint under reply, I deny the allegations made therein are false. With further reference to the said para it is substantially correct to state that in all cases of grafting patient is kept under closer observations to find out whether blood is flowing normally. In case there is stoppage or lack of flow immediate action is taken to control the situation because lack of blood is certain to rupture and deaden the muscles. I say and submit that even while treating the said deceased, utmost care was taken by the opp. party in post operative period. In this connection I say and submit that patient was kept in Cardio Vascular Incentive Care Unit CVICU which is considered to be finest in India. The patient was continuously monitored by efficient and trained nursing staff and was also monitored for 24 hours by resident doctor. With further reference to the said para I deny that at about 4.30 a.m. on 24-4-1998 the attending nurse observed that lower limbs had become cold as alleged or at all. I deny that, doctors were summoned and that I came to the said unit, only at 9.30 a.m. as alleged or at all. I deny that, because of the so called delay on my part further complications took place in the case of the said deceased as alleged or at all. I say and submit that immediately after I received message from the resident doctor attached to the opp. party no.1 attended the said patient at about 9.00 a.m. and not at 9.30 a.m. as sought to be suggested by the complainant.
35. That in spite of the critical condition of the complainant on 24.4.98, he was made to stand in queue for DSA test for more than 3 hours. This delay further worsened the condition of the complaint it appears that Bombay Hospital had no medical ethics. 36. The situation turned darker because after waiting for 3 hours the complainant was informed that the machine was dis-functional.	17. With reference to paras 35 and 36 of the complaint under reply, I deny that in spite of critical condition of the complainant on 24.4.1998 he was deliberately made to stand in queue for DSA test for more than 3 hours. I deny that the said delay was deliberate and due to the said delay the condition of the said patient, further worsened as alleged or at all. I say and submit that to the best to my knowledge immediately I suggested DSA test on 24.4.1998, the staff of the opp. party no.1 took the said deceased for DSA test but unfortunately during the relevant time the equipment was not functioning properly and as soon as the defects were located the said test was conducted to enable the opp parties to give further treatment to the said deceased. I say and submit that on perusal of the case papers on record, it is crystal clear that the best possible treatment and due care was given to the said deceased under circumstances. I say and submit that during the relevant time the condition of the said deceased was critical and therefore it was not possible to shift the said patient to any other hospital in nearby vicinity for any test including DSA. It is also significant, to note here that during the relevant time DSA test machinery was available only in Jaslok Hospital, Hinduja Hospital and Breach Candy Hospital. However, it was not possible to shift the said patient for the said test considering the patient condition. In any event I dispute the allegations made by the complainant as the complainant’s failed to substantiate the said allegations by producing any independent material on that behalf. Besides this the said allegations are not based or supported on the basis of the independent expert’s opinion.
37. That on the same day at 12.30 p.m. (8 hours after it was discovered that blood supply has stopped) angiography was performed. But again the report was given at 3.30 p.m. a further delay of 3 hours which were crucial to the life of the complainant.	18. With reference to para 37 of the complaint under reply, it is substantially correct to state that on the same day at about 12.30 p.m. angiography was performed. However, I deny that report was made available only at 3.30 p.m. as alleged or at all. I deny that further delay of 3 hours which were crucial to the life of the deceased, contributed towards further complications as alleged or at all.
38. That on receipt of the report the surgeon decided to reopen the abdomen to make correctness. Again the operation could not be done immediately because the hospital did not have a vacant operation theatre. The hospital did not have emergency operation theatre. The hospital did not even try to operate the patient in an outside operation theatre. This caused another delay of 3 hours. 39. The sequence of event shows that for various causes wholly attributable to the Bombay Hospital that treatment was delayed by 12 hours while the muscles cannot survive lack of blood supply for more than two hours.	19. With reference to paras 38 and 39 of the complaint under reply, it is substantially correct to state that the surgeon decided to reopen abdomen to make correctness after perusing the angiography report. However, I deny that operation was postponed or delayed as theatre was not available. I say and submit that the said delay was not at all deliberate. During the relevant time, the operation theatres of opp. party no.1 were occupied as other patients were under treatment. 20. With further reference to the said para the allegations made therein are not only baseless but the same are made with ulterior motive and malafide intention. I say and submit that to my personal knowledge and the opp. party no.1 is one of the most well equipped hospital in Asia. I say and submit that there are 4 operation theatres available for CU surgery only which is a rear phenomenon in city of Mumbai and therefore the allegations made by the complainants that the hospital did not have emergency operation is totally baseless.
40. There was a finding of impending gangrene in the DSA report dated 22.4.98 by Dr. Somaya himself but no heed was paid to it. 41. That Dr. Somaya being the Senior most surgeon of the team was duty bound to keep the patient in constant observation, but after the patient was shifted to recovery room, he came to examine the patient after nearly 16 hours. Had he seen the patient one or two hours after he was shifted, he could have observed that no blood was flowing through the graft. The surgeons negligence caused the patient his life.	21. With reference to paras 40 and 41 of the complaint under reply, I deny the allegation made therein as false. I say and submit that on perusal of the case papers maintained by the opp. party no.1 it is abundantly clear that I was constantly monitoring the said deceased therefore allegations that I examined the said patient nearly after 16 hours from the surgery is totally false, frivolous and vexatious and the said allegations appears to have been made with ulterior motive and malafide intention to some how make out case of medical negligence against me with an intention to knock out hand sum ransom from me and opp. party no.1. I say and submit that I treated the said patient with best of my ability and with due and diligent care and therefore, I am pained to hear such allegations from the family members of the deceased, that too, after 18 months from the said treatment. It is significant to note here that if the complainants were really convinced about the so called negligence on the part of the opp. parties, surely the complainants or other relatives of the said deceased would have lodged complaint with local police station or insisted for post-mortem of the said deceased and/or would have approached the Court against the hospital as well as against me. The very fact that present complaint has been filed on 10.7.1999 without sending any proper notice thereby railing upon the opp. parties to explain the so called negligence also supports my case that present complaint is filed with ulterior motive with an intention to knock out hand sum ransom from the opp. parties.
42. That leaving the patient fighting for his life in the care of inexperienced junior doctors viz. Dr. Partha and Bindra, Dr. Somaya went abroad for vacationing. He was not available even for advice for more than 30 days.	22. With reference to para 42 of the complaint under reply, I deny that during the relevant time I went abroad for vacation thereby leaving the patient fighting for his life in the care of inexperienced junior doctors viz. Dr. Partha and Dr. Bindra as alleged or at all. I say and submit that aforementioned allegations are not only false but the said allegations are made with an intention to cause prejudice in the mind of the Hon’ble Members of National Commission. In this connection, I say and submit that during the relevant time i.e. between 9th May 1998 to 7.6.1998, I had to China, England and USA to attend medical conferences and both the said conferences were fixed well in advance. Similarly the allegations of the complainants that Dr. Partha and Dr. Bindra are inexperienced junior doctors is also baseless for the simple reasons that both the aforementioned doctors are postgraduate and experienced in their respective field and both are having adequate experience in the aforementioned field. Besides this the said deceased was being treated by senior specialist at the opp. party no.1 hospital and in case of any emergency opp. party no.1 could have arranged senior experts and therefore merely because I was away from India that too in connection with my professional activities, the complainants should not be permitted to make capital out of it.
43. That Dr. Kripalani a neurologist when called to examine the patient remarked that “both the legs are gone and it is a gone case. Your doctor should tell each and everything”. But Dr. Somaya continued to conceal the health prognosis from the complainant and his relatives and continued to delay in taking vital decisions. Had he taken a decision to amputate the legs at the right time he could have saved the life of the complainant.	23. With reference to para 43 of the complaint under reply, I say and submit that Dr. Kripalani is a Nephrologists. I deny that Dr. Kripalani remarked that both the legs are gone and it is a gone case. I deny that Dr. Kripalani further observed that doctors deliberately suppressed the said fact from you as alleged or at all. I say and submit that though the said allegations are made by the complainant in the name of Dr. Kripalani, the complainants have miserably failed to substantiate the said allegation by filing affidavit of Dr. Kripalani. I say and submit that after perusing the aforementioned allegations I have consulted Dr. Kripalani and Dr. Kripalani has confirmed that he had no such occasion to make any such observations to the relatives of the said complainant. I am filing the affidavit of Dr. Kripalani to substantiate my contention.
44. It is clear to even a novice medical student that dead muscles invite septicemia and gangrene. So what was required was a timely action to prevent further damage. But Dr. Somaya refrained from adopting the requisite procedure. The patients legs were amputated only when all the consultants opined that it was the only procedure for saving life. Yet his negligence in taking timely action killed the only chance which the patient had. 45. That it is apparent from the series of events that there has been lack of diligence and an established case of negligence on the part of opposite party in providing services to the complainants as a result of which the complainant died on 12.6.1998 at 9.30 p.m.”	24. With reference to paras 44 and 45 of the complaint under reply, I deny the allegations made therein as false save and except the factual position that the said deceased died on 12.6.1998 at 9.30 p.m. I say and submit that though it is unfortunate that the said deceased died prematurely at the age of 43, even then the complainants have no right of whatsoever nature to make allegations against the opp. parties. I say and submit that my sympathies are with the complainant and other family members and relatives of the said deceased. I say and submit that the said deceased died due to medical, mishap and not due to any negligence either on my part or on the part of the staff of the opp. party no.1.”

11. The affidavit of the complainant is on the same lines as the averments made in the complaint before the Commission.

12. The grievance of the complainant against the appellants can be summarized under the following heads:

(a) The Doctor had not examined the patient after surgery;

(b) The patient was made to stand in queue for DSA test despite his critical condition whereafter the machine was found to be dysfunctional;

(d) The Hospital delayed treatment by 12 hours as no operation theatre was available;

(e) The Doctor did not attend the patient and left him in the care of inexperienced doctors;

(f) Doctor failed to amputate legs on time on account of gangrene and did not try to treat the gangrene; and

(g) The reliance on the principle of res ipsa loquitor to support the finding that it is a case of medical negligence.

13. Learned Commission while analyzing the evidence observed that the complainant had filed evidence affidavits but the Hospital and the Doctor, though have filed their written versions, but have not filed evidence by way of affidavits except an affidavit of Dr. Kripalani. We however find at the outset that such primary observation is itself erroneous. The Hospital and the Doctor had filed their written version by way of affidavit dated 7.1.2000 i.e., the same date on which Dr. Kripalani had filed an affidavit. The Commission has overlooked the fact that written version is by way of an affidavit. Later, the Hospital had also filed evidence affidavit on 13.07.2009 whereas the Doctor had filed a short affidavit on 30.8.2009 reiterating and confirming the statements, averments and the contentions raised in the written version filed on 7.1.2000. Thus, there is factual error in the order of the Commission.

14. The Commission had commented adversely against the Doctor that he had not seen or attended the patient for several days before his departure for his tour to U.S.A and U.K for about a month and had not even indicated the name of any super specialist in his field who should look after the patient in his absence. The Commission mentioned that the Doctor observed at the first instance within a couple of days of admission at the Hospital that there was impending gangrene and that Dr. Partha and Dr. Bindra did not take timely decision for amputation of legs and by the time Dr. Pachore was consulted, it was too late. Moreover, it was also noted that Dr. Pachore had scolded Dr. Partha for the delay in consulting him as even if the amputation was done at such belated occasion, nothing could be said about the survival of the patient.

15. The Commission opined that considering the conditions in India, it is very difficult to secure the presence of an expert doctor to file an affidavit against another expert doctor and thus it would be a case of res ipsa loquitor. It was mentioned that though the Doctor was present at Mumbai from 29.4.1998 to 9.5.1998, he did not give advice for amputation of the legs and thereafter from 9.5.1998 to 7.6.1998, he went to U.S.A and U.K to attend medical conferences. He had visited the patient only on 8.6.1998 after several days of amputation. The Commission relied upon judgment in Whitehouse v. Jordan and Anr, [1981] 1 Weekly Law Reports 246 to apply the principle of res ipsa loquitor. A reference was also made to an article “Repair of Infraneral Abdominal Aortic Aneurysms (AAAs): Introduction” to say that the mortality associated with repair of AAAs has been greatly reduced by improvements in preoperative evaluation and perioperative care. Another text book by Robert B. Rutherford was referred to note that paraplegia was a rare complication in the case of Aneurysms whereas in the present matter, paraplegia occurred instantaneously.

16. Learned counsel for the appellants herein argued that the Hospital is a renowned hospital having four operation theatres and advance machines including DSA. Three other hospitals in Mumbai such as Jaslok Hospital, Hinduja Hospital and Breach Candy Hospital alone had DSA machines at the relevant time. The Hospital in its affidavit had inter alia mentioned that the DSA test is not a bed side test. The patient has to be carefully shifted to the cardiac cauterization department where the DSA machine was installed. The patient hence had to be stabilized before he was shifted to DSA department. Since the patient was put on ventilator and on several support medications, it was not possible to immediately undergo the DSA test. But when the patient was taken for DSA test, the machine developed certain technical problem. Since the DSA machine was not working, angiography was thought to be the best possible test and was thus conducted. The Hospital had specialized staff in all branches of medicine and the medical assistance as was required from time to time including nephrology, orthopedics etc. was provided to the patient. It was argued that the professional competence of Doctor has not been doubted even by the Commission but two factors have been taken against the Doctor for holding him negligent; first, that he did not visit the patient soon after the surgery till 9/9.30 a.m. on the next day to verify the blood flow after the surgery, and second, he did not visit the patient from 29.4.1998 to 9.5.1998 when he was in Mumbai and from 9.5.1998 to 7.6.1998 when he went abroad for attending medical conferences.

17. We do not find that the basis of finding the Doctor negligent in providing medical care is sustainable as there are both legal and factual errors in the findings recorded by the Commission.

18. Dr. K.G. Deshpande had referred the patient to the Doctor on 15.4.1998 with advice of urgent surgical repair of Aneurysum. The patient had taken another six days to consult Doctor at Mumbai and it was only on 21.4.1998 that the patient was examined by the Doctor and was advised immediate Aneurysmectomy in view of the impending gangrene. Therefore, gangrene was not found to be impending after few days of admission to the Hospital but even before the patient was admitted. The patient was in critical condition when the Doctor was consulted on 21.4.1998 and surgery was thereafter performed within two days.

19. Further, the non-working of the DSA machine and consequent delay in performing the test cannot be said to be negligence on the part of the Doctor or the Hospital. The DSA machine is a large, expensive and complicated machine which unfortunately developed certain technical problem at the time when patient had to be tested. Any machine can become non-functional because of innumerable factors beyond the human control as the machines involve various mechanical, electrical and electronic components. The DSA test was conducted in the Hospital on 22.4.1998 and hence DSA machine cannot be said to be dysfunctional for a long time. The alternative process to determine the blood flow was carried out by angiography and the decision for re-exploration was taken at 12.30 p.m. No fault can be attached to the Hospital if the operation theatres were occupied when the patient was taken for surgery. Operation theatres cannot be presumed to be available at all times. Therefore, non-availability of an emergency operation theatre during the period when surgeries were being performed on other patients is not a valid ground to hold the Hospital negligent in any manner.

20. The re-exploration of operative notes dated 24.4.1998 shows that a fresh graft was sutured in place after establishing the flow. The patient was then put on ventilator and shifted to recovery room. On 25.4.1998, a note by Dr. Bindra indicated that the patient was seen by Dr. Shruti. It was noted that there was no movement in both the legs but had pin prick sensation and below mid-thigh, sensation was present on the lower limbs. Further, legs were warm till the ankles and the feet were cold. On 27.4.1998, Dr. H.S. Bindra had sought consultation from Dr. Khadilkar giving case history that limbs were warm and that the patient had pain in the lumber region and was also feeling tightness in both the lower limbs. Dr. Khadilkar noted his impressions that it was very likely lower spinal cord/conus syndrome and thereafter advised MRI of the lower cervical spine and till then to continue with the medicine pentosiflin and lomodex and for muscle ischemia – high CK and Myoglobulin. Dr. Khadilkar suggested the same treatment to continue on 28.4.98. On 29.4.1998, Dr. Khadilkar had reported the sensory level dropped to upper l/3^rd of the thigh and that there was no power in limbs. No changes were however seen in the MRI report. It was also reported that probably myonecrosis was playing more significant role in the weakness. The patient was put on dialysis thereafter.

21. The patient was examined by Dr. Kripalani or his unit from 1.5.1998 and thereafter for many days till 23.5.1998. The dialysis was being conducted in the meantime as well. The patient was being monitored by Dr. Bindra throughout. Subsequently, the patient was referred to Dr. Amarapurkar on 12.5.1998 when it was noted that Ischemic Injury to liver needed no treatment on 13.5.1998. The patient was then referred to Dr. Amin for enternal nuirisim on 16.5.1998.

22. It was further noted on 18.05.1998 from Colour Flow Imaging of limb arteries that both common femoral, superficial femoral and popliteal arteries were patent. The flow in both posterior tibial arteries was of low velocity and of venous type, suggesting refilled flow. Dr. Pachore also examined the patient on 27.5.1998 and observed that the patient had wet gangrene below knee and was thus advised amputation. On 29.5.1998, the patient was operated for amputation below the knee at the level of tibial tuberosity for treatment of wet gangrene and the Bilateral Guillatine Amputation was carried out. On 30.05.1998, it was noted that the acute renal failure was improving. Further septicemia was diagnosed on 30.05.1998. Later, on 12.06.1998, the patient was put on ventilator and he subsequently passed away at 9.30 pm due to septicemic shock.

23. It is to be noted that it is not the case of the complainant that Doctor was not possessed of requisite skill in carrying out the operation. In fact, the patient was referred to him by Dr. Deshpande keeping in view the expertise of the Doctor in vascular surgery. There is no proof that there was any negligence in performing the surgery on 23.4.1998 or in the process of re-exploration on 24.4.1998. The allegation is of failure of the Doctor to take the follow-up action after surgery on 23.4.1998, a delayed decision to amputate the leg subsequent to re-exploration on 24.4.1998, and the alleged undue foreign visit of the Doctor.

24. In respect to such contention of the Doctor being on a foreign visit, it is well known a medical professional has to upgrade himself with the latest development in his field which may require him to attend conferences held both in and outside the country. Mere fact that the Doctor had gone abroad cannot lead to an inference of medical negligence as the patient was admitted in a hospital having specialists in multi-faculties. Two doctors from the unit of the Doctor namely Dr. Bindra and Dr. Partha, both post graduates, were present to attend to the patient. Moreover, as per the stand of the Hospital and the Doctor, the patient was kept in Cardio Vascular Intensive Care Unit after the surgery and was continuously being monitored by qualified post-graduate doctors including Dr. Nemish Shah, Head of Cardio Vascular Surgery. The patient was even attended by other specialist doctors as well which is evident from the brief summary of treatment given to the patient. The experts in the other fields have been consulted from time to time and the treatment was modulated accordingly. In spite of the treatment, if the patient had not survived, the doctors cannot be blamed as even the doctors with the best of their abilities cannot prevent the inevitable.

25. The blood was flowing properly soon after the surgery but later the formation of clot was confirmed after the angiography test was conducted at 12.30 p.m. An immediate decision was taken for re-exploration at 3.30 p.m. The allegation of delay in treatment after the surgery seems to be baseless as the patient was being administered antibiotics like Metrogyl 400 and Piperacillin Injection which are used for treatment in gangrene. Dr. Kripalani in his affidavit denied the allegation leveled by the complainant. Dr. Kripalani had treated patient continuously including carrying out the dialysis. In respect of the allegation that doctors failed to amputate legs on time, efforts were being made to save the limbs as amputation is considered as the last resort. The amputation was done as per the advice of Dr. Pachore. In the present era of super-specialization, one doctor is not a solution for all problems of a patient. Each problem is dealt with by an expert in the concerned field and that is what is apparent from the medical record. The stand of the complainant is that since surgery was performed by a doctor, he alone would be responsible for different aspects of the treatment required and given to the patient. However, it is an incorrect assumption to be made.

26. It is a case where the patient was in serious condition impending gangrene even before admission to the Hospital but even after surgery and re-exploration, if the patient does not survive, the fault cannot be fastened on the doctors as a case of medical negligence. It is too much to expect from a doctor to remain on the bed side of the patient throughout his stay in the hospital which was being expected by the complainant here. A doctor is expected to provide reasonable care which is not proved to be lacking in any manner in the present case.

27. The sole basis of finding of negligence against the Hospital is of res ipsa loquitor. It is to be noted that res ipsa loquitor is a rule of evidence. This Court in a judgment reported as Syad Akbar v. State of Karnataka, (1980) 1 SCC 30 explained the principle in a criminal trial as under:

“19. As a rule, mere proof that an event has happened or an accident has occurred, the cause of which is unknown, is not evidence of negligence. But the peculiar circumstances constituting the event or accident, in a particular case, may themselves proclaim in concordant, clear and unambiguous voices the negligence of somebody as the cause of the event or accident. It is to such cases that the maxim res ipsa loquitur may apply, if the cause of the accident is unknown and no reasonable explanation as to the cause is coming forth from the defendant. To emphasise the point, it may be reiterated that in such cases, the event or accident must be of a kind which does not happen in the ordinary course of things if those who have the management and control use due care. But, according to some decisions, satisfaction of this condition alone is not sufficient for res ipsa to come into play and it has to be further satisfied that the event which caused the accident was within the defendant’s control. The reason for this second requirement is that where the defendant has control of the thing which caused the injury, he is in a better position than the plaintiff to explain how the accident occurred. Instances of such special kind of accidents which “tell their own story” of being off springs of negligence, are furnished by cases, such as where a motor vehicle mounts or projects over a pavement and hurts somebody there or travelling in the vehicle; one car ramming another from behind, or even a head-on collision on the wrong side of the road. (See per Lord Nor-mand in Barkway v. South Wales Transport Co. [(1950) 1 All ER 392, 399]; Cream v. Smith [(1961) 8 AER 349]; Richley v. Faull [(1965) 1 WLR 1454 : (1965) 3 All ER 109])

20. Thus, for the application of the maxim res ipsa loquitur “no less important a requirement is that the res must not only bespeak negligence, but pin it on the defendant”.

xxx xxx xxx

26. From the above conspectus, two lines of approach in regard to the application and effect of the maxim res ipsa loquitur are discernible. According to the first, where the maxim applies, it operates as an exception to the general rule that the burden of proof of the alleged negligence is, in the first instance, on the plaintiff. In this view, if the nature of an accident is such that the mere happening of it is evidence of negligence, such as, where a motor vehicle without apparent cause leaves the highway, or overturns or in fair visibility runs into an obstacle; or brushes the branches of an overhanging tree, resulting in injury, or where there is a duty on the defendant to exercise care, and the circumstances in which the injury complained of happened are such that with the exercise of the requisite care no risk would in the ordinary course ensue, the burden shifts or is in the first instance on the defendant to disprove his liability. Such shifting or casting of the burden on the defendant is on account of a presumption of law and fact arising against the defendant from the constituent circumstances of the accident itself, which bespeak negligence of the defendant. This is the view taken in several decisions of English courts. [For instance, see Burke v. Manchester, Sheffield & Lincolnshire Rail Co. [(1870) 22 LJ 442]; Moore v. R. Fox & Sons [(1956) 1 QB 596 : (1956) 1 All ER 182]. Also see paras 70, 79 and 80 of Halsbury’s Laws of England, Third Edn., Vol. 28, and the rulings mentioned in the footnotes thereunder.]

27. According to the other line of approach, res ipsa loquitur is not a special rule of substantive law; that functionally, it is only an aid in the evaluation of evidence, “an application of the general method of inferring one or more facts in issue from circumstances proved in evidence”. In this view, the maxim res ipsa loquitur does not require the raising of any presumption of law which must shift the onus on the defendant. It only, when applied appropriately, allows the drawing of a permissive inference of fact, as distinguished from a mandatory presumption properly so-called, having regard to the totality of the circumstances and probabilities of the case. Res ipsa is only a means of estimating logical probability from the circumstances of the accident. Looked at from this angle, the phrase (as Lord Justice Kennedy put it [Russel v. London & South Western Railway Co, (1908) 24 TLR 548]) only means, “that there is, in the circumstances of the particular case, some evidence which, viewed not as a matter of conjecture, but of reasonable argument, makes it more probable that there was some negligence, upon the facts as shown and undisputed, than that the occurrence took place without negligence …. It means that the circumstances are, so to speak, eloquent of the negligence of somebody who brought about the state of things which is complained of.”

28. Recently, a three Judge Bench in a judgment reported as Iffco Tokio General Insurance Company Limited v. Pearl Beverages Limited, (2021) 7 SCC 704 approved the aforesaid judgment in a case of medical negligence being examined by the consumer fora. It was held as under:

“86. Thus, it is used in cases of tort and where the facts without anything more clearly and unerringly point to negligence. The principle of res ipsa loquitur, as such, appears to be inapposite, when, what is in question, is whether driver was under the influence of alcohol. It may be another matter that though the principle as such is inapplicable, the manner in which the accident occurred may along with other circumstances point to the driver being under the influence of alcohol.”

29. In Martin F. D’Souza v. Mohd. Ishfaq, (2009) 3 SCC 1, this court observed that the doctor cannot be held liable for medical negligence by applying the doctrine of res ipsa loquitur for the reason that a patient has not favourably responded to a treatment given by a doctor or a surgery has failed. There is a tendency to blame the doctor when a patient dies or suffers some mishap. This is an intolerant conduct of the family members to not accept the death in such cases. The increased cases of manhandling of medical professionals who worked day and night without their comfort has been very well seen in this pandemic. This Court held as under:-

“40. Simply because a patient has not favourably responded to a treatment given by a doctor or a surgery has failed, the doctor cannot be held straightaway liable for medical negligence by applying the doctrine of res ipsa loquitur. No sensible professional would intentionally commit an act or omission which would result in harm or injury to the patient since the professional reputation of the professional would be at stake. A single failure may cost him dear in his lapse.

xxx xxx xxx

42. When a patient dies or suffers some mishap, there is a tendency to blame the doctor for this. Things have gone wrong and, therefore, somebody must be punished for it. However, it is well known that even the best professionals, what to say of the average professional, sometimes have failures. A lawyer cannot win every case in his professional career but surely he cannot be penalised for losing a case provided he appeared in it and made his submissions.”

30. In case of medical negligence, this Court in a celebrated judgment reported as Jacob Mathew v. State of Punjab and Anr., (2005) 6 SCC 1 held that simple lack of care, an error of judgment or an accident, is not a proof of negligence on the part of a medical professional. The Court held as under:

“48. We sum up our conclusions as under:

(I) Negligence is the breach of a duty caused by omission to do something which a reasonable man guided by those considerations which ordinarily regulate the conduct of human affairs would do, or doing something which a prudent and reasonable man would not do. The definition of negligence as given in Law of Torts, Ratanlal & Dhirajlal (edited by Justice G.P. Singh), referred to hereinabove, holds good. Negligence becomes actionable on account of injury resulting from the act or omission amounting to negligence attributable to the person sued. The essential components of negligence are three: “duty”, “breach” and “resulting damage”.

(2) Negligence in the context of the medical profession necessarily calls for a treatment with a difference. To infer rashness or negligence on the part of a professional, in particular a doctor, additional considerations apply. A case of occupational negligence is different from one of professional negligence. A simple lack of care, an error of judgment or an accident, is not proof of negligence on the part of a medical professional. So long as a doctor follows a practice acceptable to the medical profession of that day, he cannot be held liable for negligence merely because a better alternative course or method of treatment was also available or simply because a more skilled doctor would not have chosen to follow or resort to that practice or procedure which the accused followed. When it comes to the failure of taking precautions, what has to be seen is whether those precautions were taken which the ordinary experience of men has found to be sufficient; a failure to use special or extraordinary precautions which might have prevented the particular happening cannot be the standard for judging the alleged negligence. So also, the standard of care, while assessing the practice as adopted, is judged in the light of knowledge available at the time of the incident, and not at the date of trial. Similarly, when the charge of negligence arises out of failure to use some particular equipment, the charge would fail if the equipment was not generally available at that particular time (that is, the time of the incident) at which it is suggested it should have been used.

xxx xxx xxx

(4) The test for determining medical negligence as laid down in Bolam case [(1957) 1 WLR 582 : (1957) 2 All ER 118 (QBD)] , WLR at p. 586 [ [Ed.: Also at All ER p. 121 D-F and set out in para 19, p. 19 herein.]] holds good in its applicability in India.

xxx xxx xxx

(5) Res ipsa loquitur is only a rule of evidence and operates in the domain of civil law, specially in cases of torts and helps in determining the onus of proof in actions relating to negligence. It cannot be pressed in service for determining per se the liability for negligence within the domain of criminal law. Res ipsa loquitur has, if at all, a limited application in trial on a charge of criminal negligence.”

31. In another judgment reported as Arun Kumar Mangliky. Chirayu Health and Medicare Private Limited and Anr., (2019) 7 SCC 401, this Court held that the standard of care as enunciated in Bolam case must evolve in consonance with its subsequent interpretation by English and Indian Courts. The threshold to prove unreasonableness is set with due regard to the risks associated with medical treatment and the conditions under which medical professionals’ function. The Court held as under:

“45. In the practice of medicine, there could be varying approaches to treatment. There can be a genuine difference of opinion. However, while adopting a course of treatment, the medical professional must ensure that it is not unreasonable. The threshold to prove unreasonableness is set with due regard to the risks associated with medical treatment and the conditions under which medical professionals function. This is to avoid a situation where doctors resort to “defensive medicine” to avoid claims of negligence, often to the detriment of the patient. Hence, in a specific case where unreasonableness in professional conduct has been proven with regard to the circumstances of that case, a professional cannot escape liability for medical evidence merely by relying on a body of professional opinion.”

32. In C.P. Sreekumar (Dr.), MS (Ortho) v. S. Ramanujam, (2009) 7 SCC 130, this Court held that the Commission ought not to presume that the allegations in the complaint are inviolable truth even though they remained unsupported by any evidence. This Court held as under:

“37. We find from a reading of the order of the Commission that it proceeded on the basis that whatever had been alleged in the complaint by the respondent was in fact the inviolable truth even though it remained unsupported by any evidence. As already observed in Jacob Mathew case [(2005) 6 SCC 1 : 2005 SCC (Cri) 1369] the onus to prove medical negligence lies largely on the claimant and that this onus can be discharged by leading cogent evidence. A mere averment in a complaint which is denied by the other side can, by no stretch of imagination, be said to be evidence by which the case of the complainant can be said to be proved. It is the obligation of the complainant to provide the facta probanda as well as the facta probantia.”

33. In another judgment reported as Kusum Sharma and Others v. Batra Hospital and Medical Research Centre and Others, (2010) 3 SCC 480, a complaint was filed attributing medical negligence to a doctor who performed the surgery but while performing surgery, the tumour was found to be malignant. The patient died later on after prolonged treatment in different hospitals. This Court held as under:

“47. Medical science has conferred great benefits on mankind, but these benefits are attended by considerable risks. Every surgical operation is attended by risks. We cannot take the benefits without taking risks. Every advancement in technique is also attended by risks.

xxx xxx xxx

72. The ratio of Bolam case [(1957) 1 WLR 582 : (1957) 2 All ER 118] is that it is enough for the defendant to show that the standard of care and the skill attained was that of the ordinary competent medical practitioner exercising an ordinary degree of professional skill. The fact that the respondent charged with negligence acted in accordance with the general and approved practice is enough to clear him of the charge. Two things are pertinent to be noted. Firstly, the standard of care, when assessing the practice as adopted, is judged in the light of knowledge available at the time (of the incident), and not at the date of trial. Secondly, when the charge of negligence arises out of failure to use some particular equipment, the charge would fail if the equipment was not generally available at that point of time on which it is suggested as should have been used.

xxx xxx xxx

78. It is a matter of common knowledge that after happening of some unfortunate event, there is a marked tendency to look for a human factor to blame for an untoward event, a tendency which is closely linked with the desire to punish. Things have gone wrong and, therefore, somebody must be found to answer for it. A professional deserves total protection. The Penal Code, 1860 has taken care to ensure that people who act in good faith should not be punished. Sections 88, 92 and 370 of the Penal Code give adequate protection to the professionals and particularly medical professionals.”

34. Recently, this Court in a judgment reported as Dr. Harish Kumar Khurana v. Joginder Singh & Others, (2021) SCC Online SC 673 held that hospital and the doctors are required to exercise sufficient care in treating the patient in all circumstances. However, in an unfortunate case, death may occur. It is necessary that sufficient material or medical evidence should be available before the adjudicating authority to arrive at the conclusion that death is due to medical negligence. Every death of a patient cannot on the face of it be considered to be medical negligence. The Court held as under:

“11……… Ordinarily an accident means an unintended and unforeseen injurious occurrence, something that does not occur in the usual course of events or that could not be reasonably anticipated. The learned counsel has also referred to the decision in Martin F.D ‘Souza v. Mohd. Ishfaq, (2009) 3 SCC 1 wherein it is stated that simply because the patient has not favourably responded to a treatment given by doctor or a surgery has failed, the doctor cannot be held straight away liable for medical negligence by applying the doctrine of Res Ipsa Loquitor. It is further observed therein that sometimes despite best efforts the treatment of a doctor fails and the same does not mean that the doctor or the surgeon must be held guilty of medical negligence unless there is some strong evidence to suggest that the doctor is negligent.

xxx xxx xxx

14. Having noted the decisions relied upon by the learned counsel for the parties, it is clear that in every case where the treatment is not successful or the patient dies during surgery, it cannot be automatically assumed that the medical professional was negligent. To indicate negligence there should be material available on record or else appropriate medical evidence should be tendered. The negligence alleged should be so glaring, in which event the principle of res ipsa loquitur could be made applicable and not based on perception. In the instant case, apart from the allegations made by the claimants before the NCDRC both in the complaint and in the affidavit filed in the proceedings, there is no other medical evidence tendered by the complainant to indicate negligence on the part of the doctors who, on their own behalf had explained their position relating to the medical process in their affidavit to explain there was no negligence……………….”

35. It may be mentioned here that the complainant had led no evidence of experts to prove the alleged medical negligence except their own affidavits. The experts could have proved if any of the doctors in the Hospital providing treatment to the patient were deficient or negligent in service. A perusal of the medical record produced does not show any omission in the manner of treatment. The experts of different specialities and super-specialities of medicine were available to treat and guide the course of treatment of the patient. The doctors are expected to take reasonable care but none of the professionals can assure that the patient would overcome the surgical procedures. Dr. Kripalani has been attributed to have informed the complainant that the patient’s legs were not working but Dr. Kripalani denied all the averments by filing of an affidavit.

36. As discussed above, the sole basis of finding the appellants negligent was res ipsa loquitor which would not be applicable herein keeping in view the treatment record produced by the Hospital and/or the Doctor. There was never a stage when the patient was left unattended. The patient was in a critical condition and if he could not survive even after surgery, the blame cannot be passed on to the Hospital and the Doctor who provided all possible treatment within their means and capacity. The DSA test was conducted by the Hospital itself on 22.4.1998. However, since it became dysfunctional on 24.4.1998 and considering the critical condition of the patient, an alternative angiography test was advised and conducted and the re-exploration was thus planned. It is only a matter of chance that all the four operation theatres of the Hospital were occupied when the patient was to undergo surgery. We do not find that the expectation of the patient to have an emergency operation theatre is reasonable as the hospital can provide only as many operation theatres as the patient load warrants. If the operation theatres were occupied at the time when the operation of the patient was contemplated, it cannot be said that there is a negligence on the part of the Hospital. A team of specialist doctors was available and also have attended to the patient but unfortunately nature had the last word and the patient breathed his last. The family may not have coped with the loss of their loved one, but the Hospital and the Doctor cannot be blamed as they provided the requisite care at all given times. No doctor can assure life to his patient but can only attempt to treat his patient to the best of his ability which was being done in the present case as well.

37. Therefore, we find that the findings recorded by the Commission holding the Hospital and the Doctor guilty of medical negligence are not sustainable in law. Consequently, the present appeals are allowed. The order passed by the Commission is set aside and the complaint is dismissed.

38. By virtue of an interim order passed by this Court on 8.3.2010, a sum of Rs. 5 lakhs was disbursed to the complainant. The said amount is ordered to be treated as ex gratia payment to the complainant and not to be recovered back by either the Hospital or the Doctor.

Posted on 15th November 202115th November 2021 by rajatbindal5gmailcom — Leave a comment

Complete breakdown of marriage – Supreme Court can pass decree of divorce under Article 142 Constitution of India.

SUPREME COURT OF INDIA

DIVISION BENCH

SUBHRANSU SARKAR — Appellant

Vs.

INDRANI SARKAR (NEE DAS) — Respondent

( Before : L. Nageswara Rao and B.R. Gavai, JJ. )

Civil Appeal No. 5696 of 2021 (@ SLP (C) No. 11747 of 2017)

Decided on : 14-09-2021

Constitution of India, 1950 – Article 142 – Divorce – Husband and wife have been living separately for more than 16 years – Marriage between the parties is emotionally dead and there is no point in persuading them to live together any more – Therefore, this is a fit case for exercise of jurisdiction under Article 142 of the Constitution of India – Marriage between the parties is dissolved.

Counsel for Appearing Parties

Mr. Saurav Gupta, Advocate, Mr. Kunal Chatterji, Advocate, Ms. Maitrayee Banerjee, Advocate, for the Appellant; Mr. Ranjan Mukherjee, Adv (A.C.), for the Respondent.

Cases Referred

Munish Kakkar v. Nidhi Kakkar, (2020) 14 SCC 657
Sukhendu Das v. Rita Mukherjee, (2017) 9 SCC 632

ORDER

Leave granted.

1. The Appellant married the Respondent on 02.03.1997 and registered the same under the Special Marriage Act, 1954. Thereafter, the marriage was solemnized between the parties on 07.12.2000 under the Hindu rites and customs. Alleging cruelty and desertion by the Respondent, the appellant filed a suit for dissolution of marriage on 05.03.2007 before the District Judge, Alipore. The suit was dismissed, aggrieved by which the Appellant filed an appeal before the High Court of Calcutta. The Respondent did not appear before the High Court. However, the High Court dismissed the appeal filed by the appellant upholding the judgment of the Trial Court. The allegation made by the Appellant against the Respondent is that she was insisting on his residing separately from his parents. Also, the Respondent misbehaved with her in-laws and that she was frequently leaving the matrimonial home. The appellant also alleged physical assault by the Respondent when both of them went to Puri and Shillong for holidays. The Respondent resisted the Petition filed for dissolution of marriage by denying the averments made against her. She accused the appellant of adultery and excessive consumption of alcohol. The Trial Court and the High Court refused to accept the contentions of the appellant that he is entitled for divorce by holding that he could not make out a case of cruelty meted out by the Respondent.

2. It was submitted by Mr. Nikhil Nayyar, learned Senior Counsel for the Appellant that the Appellant and Respondent have been living separately for more than 16 years and for all practical purposes the marriage is dead. He relied upon two judgments of this Court in Sukhendu Das v. Rita Mukherjee, (2017) 9 SCC 632 and Munish Kakkar v. Nidhi Kakkar, (2020) 14 SCC 657 in support of his submission that this Court in exercise of its power under Article 142 of the Constitution of India has dissolved marriages when they are totally unworkable and irretrievable.

3. We have requested Mr. Ranjan Mukherjee to assist this Court as Amicus Curiae on behalf of the Respondent as she did not engage an Advocate. Mr. Ranjan Mukherjee informed this Court that the Respondent intends to continue to live with the Appellant. Mr. Mukherjee informed this Court that he spoke to the Respondent several times and the Respondent is not convinced that an unworkable marriage should be put to an end. In Sukhendu Das v. Rita Mukherjee (supra), this Court considered a similar situation where the marriage between the parties took place on 19.06.1992 and they were living apart from the year 2000. The Trial Court found that the husband could not prove cruelty by his wife and that he was not entitled for decree of divorce. The judgment of the Trial Court was upheld by the High Court and the same was the subject matter of challenge before this Court. The Respondent failed to appear before this Court in spite of notice being served. By holding that there was an irretrievable breakdown of marriage, this Court dissolved the marriage between the parties therein by observing that they had been living separately for more than 17 years and no useful purpose would be served by compelling them to live together in matrimony.

4. To do complete justice between the parties, this Court in Munish Kakkar v. Nidhi Kakkar (supra) put an end to the bitter matrimonial dispute which lingered on for two decades between the parties therein.

5. The Appellant is a police officer in the State of West Bengal and has made allegation of cruelty and desertion against the Respondent. Though the respondent has insisted that she intends to live with the Appellant, no meaningful effort has been made by her for reconciliation. Allegations made by the Respondent relate to adultery by the Appellant which was the reason for her moving out of the matrimonial home. In spite of the best efforts made by Mr. Mukherjee, the Respondent has insisted that she is not willing for dissolution of the marriage. Mr. Mukherjee has brought to our notice that the Respondent has to take care of her son who is suffering from serious ailments.

6. Having scrutinized the material on record and considering the submissions made by Mr. Nikhil Nayyar and Mr. Ranjan Mukherjee, learned Amicus Curiae, without commenting on the merits of the matter, the marriage between the parties is emotionally dead and there is no point in persuading them to live together any more. Therefore, this is a fit case for exercise of jurisdiction under Article 142 of the Constitution of India. The marriage between the parties is dissolved. The Registry is directed to prepare a decree accordingly. Taking note of the submissions made by Mr. Ranjan Mukherjee, we direct the Appellant to pay an amount of Rs. 25 Lakhs (Rupees Twenty-Five Lakhs) to the Respondent within a period of eight weeks from today. The petition filed by the Respondent under Section 125 Cr. PC for maintenance shall be withdrawn by the Respondent on receipt of the amount of Rs. 25 Lakhs. The payment of the aforesaid amount is in full and final settlement of all claims of the Respondent against the Appellant.

7. The appeal is disposed of accordingly.