Case Note & Summary
The petitioner, Vedanta Limited, challenged two orders of the Commercial Court at Panaji in Special Civil Suit (Commercial) No.84 of 2017. The first order dated 27.03.2018 dismissed the petitioner's application (exhibit-12) for time to file written statement, and the second order dated 15.01.2019 dismissed the application (exhibit D-13) for recall of the earlier order. The respondent, Global Energy Pvt. Ltd., had filed a suit for specific performance of an agreement dated 18.12.2013 and for damages. The suit was originally filed on 25.07.2016 before the Senior Civil Judge as Special Civil Suit No.28/2016/A, after the Commercial Courts Act, 2015 came into force but before the Commercial Courts were constituted at Panaji on 03.11.2016. In June 2017, the suit was transferred to the Commercial Court and re-registered. The petitioner was served with summons on 24.01.2018 and filed an application on 27.02.2018 seeking 45 days' time to file written statement, which was dismissed on 27.03.2018 on the ground that the time of 120 days from the date of service had expired. The petitioner then filed an application for recall, which was also dismissed on 15.01.2019. The High Court held that the Commercial Court erred in dismissing the applications without considering the reasons for delay and the lack of prejudice to the plaintiff. The court observed that the time to file written statement can be extended beyond 120 days in exceptional circumstances, and the Commercial Court has inherent power to recall its order. The court allowed the petition, set aside the impugned orders, and permitted the petitioner to file written statement within four weeks, subject to payment of costs of Rs. 25,000 to the respondent.
Headnote
A) Civil Procedure - Written Statement - Time to File - Order VIII Rule 1 CPC - Commercial Courts Act, 2015 - The court held that the time to file written statement can be extended beyond 120 days in exceptional circumstances, and the Commercial Court erred in mechanically rejecting the application for time without considering the reasons for delay and the lack of prejudice to the plaintiff. (Paras 10-15) B) Civil Procedure - Recall of Order - Inherent Powers - Section 148 CPC - The court held that the Commercial Court has inherent power to recall its order if it was passed without hearing the party or if there is sufficient cause, and the dismissal of the recall application was unsustainable as the defendant had shown sufficient cause for the delay. (Paras 16-20) C) Commercial Law - Commercial Dispute - Specific Performance - The suit was for specific performance of an agreement dated 18.12.2013, which is a commercial dispute under the Commercial Courts Act, 2015. The court allowed the petitioner to file written statement subject to costs. (Paras 3, 21)
Issue of Consideration
Whether the Commercial Court was justified in refusing to grant time to file written statement and in dismissing the application for recall, thereby precluding the defendant from filing written statement.
Final Decision
The High Court allowed the writ petition, set aside the impugned orders dated 27.03.2018 and 15.01.2019, and permitted the petitioner to file written statement within four weeks from the date of the order, subject to payment of costs of Rs. 25,000 to the respondent.
Law Points
- Order VIII Rule 1 CPC
- Order VIII Rule 10 CPC
- Section 16 of Commercial Courts Act
- 2015
- Section 148 CPC
- inherent powers of court
- liberal construction of procedural law
- right to defend
- prejudice to plaintiff
