Case Note & Summary
The appeal arose from an order of the High Court of Karnataka in a writ petition concerning a summary suit under Order XXXVII CPC. The respondents/plaintiffs had filed a suit for recovery of Rs. 1,04,16,576/- with interest. The trial court granted leave to defend on condition of depositing 50% of the claim. The defendants challenged this condition unsuccessfully up to the Supreme Court, which dismissed their SLP but allowed them to approach the High Court for variation. The defendants did not do so. Subsequently, the plaintiffs filed a memo under Order XXXVII Rule 3(6)(b) CPC seeking a decree. The trial court rejected the memo, but the High Court set aside that order and directed acceptance of the memo. The defendants appealed to the Supreme Court, arguing that a moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 had become operational. However, during the pendency of the appeal, the trial court decreed the suit on 20th April 2023. The Supreme Court noted that the decree had not been challenged and the suit was no longer pending. Therefore, the appeal against the interim order had become infructuous. The Court dismissed the appeal as infructuous without considering the merits of the IBC argument.
Headnote
A) Civil Procedure - Summary Suit - Order XXXVII CPC - Appeal against interim order becomes infructuous if suit is decreed pending appeal - The appellant challenged an order directing acceptance of a memo for decree under Order XXXVII Rule 3(6)(b) CPC. During the appeal, the suit was decreed on 20.04.2023. The Supreme Court held that since the suit is no longer pending, the appeal against the interim order has been rendered infructuous and dismissed it. (Paras 5-6)
B) Insolvency and Bankruptcy Code - Moratorium - Section 14 IBC - Moratorium argument not adjudicated due to mootness - The appellant raised the defence of moratorium under Section 14 IBC, but the Court did not consider it as the appeal was dismissed as infructuous. (Para 5)
Issue of Consideration
Whether an appeal against an interim order in a summary suit under Order XXXVII CPC becomes infructuous when the suit itself is decreed during the pendency of the appeal.
Final Decision
The Supreme Court dismissed the civil appeal as infructuous, noting that the suit had been decreed on 20th April 2023 and no challenge to the decree was brought to its notice. The appeal against the interim order was rendered infructuous.
Law Points
- Appeal becomes infructuous when main suit is decreed pending appeal against interim order
- Order XXXVII CPC
- Section 14 IBC moratorium not considered due to mootness
Case Details
2024 LawText (SC) (6) 141
Civil Appeal arising out of SLP (C) No. 20626 of 2019 (but the present appeal is not numbered separately in text)
Prashant Kumar Mishra, J.
Anish M Rawther @ Anees Mohammed Rawther
Hafeez ur Rahman and Others
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Nature of Litigation
Civil appeal against an interim order in a summary suit for recovery of money under Order XXXVII CPC.
Remedy Sought
The appellant/defendant sought to set aside the High Court order directing the trial court to accept the plaintiffs' memo for decree under Order XXXVII Rule 3(6)(b) CPC.
Filing Reason
The appellant challenged the High Court's order allowing the writ petition and directing acceptance of the memo for decree, arguing that a moratorium under Section 14 IBC had become operational.
Previous Decisions
The trial court granted leave to defend on condition of depositing 50% of the claim; the High Court dismissed the writ against that order; the Supreme Court dismissed the SLP but allowed the defendants to approach the High Court for variation, which they did not do. The trial court rejected the memo for decree; the High Court set aside that rejection and directed acceptance.
Issues
Whether the appeal against the interim order has become infructuous because the suit was decreed during the pendency of the appeal.
Whether the moratorium under Section 14 IBC bars the proceedings.
Submissions/Arguments
The appellant/defendant argued that due to the moratorium under Section 14 IBC, the suit cannot proceed.
The respondent/plaintiff sought decree under Order XXXVII Rule 3(6)(b) CPC.
Ratio Decidendi
An appeal against an interim order in a pending suit becomes infructuous if the suit itself is decreed during the pendency of the appeal, as there is no live controversy regarding the interim order.
Judgment Excerpts
It is important to notice that this Court has passed an order on 01st December 2023 staying the impugned order, however, much prior to the interim order of this Court, the suit itself was decided finally by passing a decree on 20th April 2023.
Thus, for the present, the suit is not pending, therefore, the present appeal which arises out of an interim order passed by the Trial Court during pendency of the suit, has been rendered infructuous.
Procedural History
The respondents/plaintiffs filed a summary suit (Com. OS No. 1026 of 2018) for recovery. The trial court granted leave to defend on condition of depositing 50% of the claim. The defendants challenged this in WP No. 28349 of 2019, which was dismissed. The SLP (C) No. 20626 of 2019 was dismissed on 06.09.2019 with liberty to approach the High Court for variation. The defendants did not do so. The plaintiffs filed a memo for decree under Order XXXVII Rule 3(6)(b) CPC on 14.11.2019. The trial court rejected the memo on 07.03.2020. The plaintiffs filed WP No. 10975 of 2020, which was allowed on 21.03.2022, directing acceptance of the memo. The defendants appealed to the Supreme Court. On 01.12.2023, the Supreme Court stayed the impugned order. Meanwhile, the trial court decreed the suit on 20.04.2023. The Supreme Court dismissed the appeal as infructuous.
Acts & Sections
- Code of Civil Procedure, 1908: Order XXXVII, Order XXXVII Rule 3(6)(b)
- Insolvency and Bankruptcy Code, 2016: Section 14
