Ashok Kumar Kalra Versus Wing CDR Surendra Agnihotri & Ors.

Court / Forum : Supreme Court of India
Citation : (2020) 2 SCC 394
Coram : Justice N.V. Ramana, Justice Mohan M. Shantanagoudar, Justice Ajay Rastogi
Subject : Filing of the counterclaim after filing the written statement under Order VIII Rule 6A of the Civil Procedural Code, 1908
Date of Decision : 2020-01-08

Brief Facts

• Dispute arose between the Petitioner (Defendant No. 2) and Respondent No. 1 (Plaintiff) concerning performance of Agreements to Sell dated November 20, 1987 and October 4, 1989.
• The Respondent No.1 (Plaintiff) filed the suit for specific performance against the Petitioner (Defendant No. 2)
• The Petitioner (Defendant No.2) filed a written statement in the Suit.
• Thereafter, the Petitioner (Defendant No. 2) filed a Counter-Claim in the same Suit against the Respondent No. 1 (Plaintiff).
• Vide the order dated May 12, 2019, the trial court allowed the filing of the Counter-Claim after the filing of the written statement and framing of issues, in order to avoid multiplicity of proceedings.
• The Order dated May 15, 2009 was challenged before the High Court of Allahabad in Civil Revision No. 253 of 2009.
• The High Court vide order dated May 1, 2018 quashed the order dated May 15, 2009 passed by the Trial Court and allowed the Civil Revision Petition No. 253 of 2009.
• Aggrieved by order of the High Court, the Petitioner (Defendant No. 2) filed the present Special Leave Petition before the Division Bench of Hon'ble Supreme Court challenging the impugned order dated May 1, 2018 passed by the High Court of Allahabad.
• Thereafter, the Division Bench referred that matter to a three-judge bench of the Hon'ble Supreme Court for clarification on the interpretation of the Order VIII Rule 6A of the CPC regarding the filing of the Counter-Claim after filing the written statement.
• Hence the present Special Leave Petition.

Issues

1. Whether Order VIII Rule 6A of the CPC mandates an embargo on filing the Counter-Claim after filing the written statement?
2. What are the restrictions on filing the counterclaim after filing of the Written Statement?

Decision

• The Hon'ble Supreme Court has held that Order VIII Rule 6A of the Code of Civil Procedure, 1908, does not put an embargo on filing of the Counter-Claim after filing of the Written Statement, rather the restriction is only with respect to the accrual of the cause of action.
• However, the right to file a Counter-Claim is not an absolute right of the Defendant, and the Defendant cannot file the same with a substantive delay.

Issue 2

• Whilst dealing with the second issue regarding the restrictions on filing the counterclaim after filing of the Written Statement, the Hon'ble Supreme Court has held that a Counter-Claim against the original claim may, at the discretion of the Court, be filed after the written statement has been filed but not after the issues have been framed.
• The Hon'ble Supreme Court has held that the Court has the discretion to entertain filing of the Counter-Claim, after taking into consideration and evaluating inclusive factors provided below which are only illustrative, though not exhaustive:
  1. Period of delay.
  2. Prescribed limitation period for the cause of a pleaded.
  3. Reason for the delay.
  4. Defendant's assertion of his right.
  5. Similarity of cause of action between the main suit and the Counter-Claim.
  6. Cost of fresh litigation.
  7. Injustice and abuse of process.
  8. Prejudice to the opposite party.
  9. Facts and circumstances of each case.
  10. In any case, not after framing of the issues.

Vipul Ganda is a Delhi based Advocate practicing largely at the Delhi High Court. His practice focus is Dispute Resolution and Litigation and his practice areas include Arbitration, Commercial, Civil, Constitutional, Corporate and Criminal Litigation.