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The Supreme Court held that a plaintiff in a commercial suit must file a reply to a counter-claim within the Order VIII Rule 1 time limits, and upheld dismissal of the belated reply.
The Supreme Court held that the High Court erred in refusing to treat the written statement filed on 07.01.2022 in the light of this Court's orders excluding the period 15.03.2020 to 28.02.2022 for limitation purposes; further, non-filing of the written statement did not extinguish the defendant's right to cross-examine the plaintiff's witnesses. The impugned judgment and decree as against Defendant No.1 were set aside and the matter was remanded for the trial court to permit the appellant to file its written statement subject to payment of costs and to allow cross-examination.
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The Supreme Court held that the orders of the Commercial Court and the High Court directing deposit of amounts of performance bank guarantees were quashed and set aside because the bank guarantees had been invoked and amounts paid prior to the Section 9 order and the pre-conditions of Order XXXVIII Rule 5 CPC were not satisfied; Section 9 relief is interim and requires satisfaction of the CPC pre-conditions before granting such measures to secure potential awards.
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The pre-deposit of 75% of the amount in terms of the arbitral award as required by section 19 of the MSMED Act, 2006 is mandatory before an application under section 34 of the Arbitration and Conciliation Act, 1996 can be entertained; however, the appellate court may permit the deposit to be made in instalments if satisfied that depositing the entire amount at once would cause undue hardship.
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The Supreme Court held that the period specified in its orders in SMWP No.3 of 2020 (ultimately excluding 15.03.2020 to 02.10.2021) must be excluded in computing the time for filing a written statement in the present commercial suit; coupled with the High Court administrative order curtailing court functioning, the 120-day statutory outer limit did not operate to forfeit the defendant’s right on 06.05.2021. Consequently the Trial Court and High Court orders refusing further time were set aside and the written statement notarised on 07.07.2021 was ordered to be taken on record.
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The Court excluded the period from 15.03.2020 till 02.10.2021 from computation of limitation for any suit, appeal, application or proceeding; the balance period of limitation as on 15.03.2020, if any, shall become available from 03.10.2021; where limitation would have expired during 15.03.2020 to 02.10.2021 all persons shall have a limitation period of 90 days from 03.10.2021 (unless the actual balance period available from 03.10.2021 is greater, in which case that longer period shall apply); and the exclusion applies to Sections 23(4) and 29A of the Arbitration and Conciliation Act, 1996, Se…
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Order XI Rule 1 (as amended for commercial suits) applies, not Order VII Rule 14(3); invoices that were not in the plaintiff's possession at the time of filing and were produced within thirty days could be permitted, but other documents that were in the plaintiff's possession and not disclosed on the ground of being voluminous did not constitute reasonable cause for non-disclosure and leave to produce them was rightly refused.
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One Judge (Indira Banerjee, J.) held that ICBC is a Scheduled Bank included in the Second Schedule to the RBI Act and that the irrevocable bank guarantee issued by ICBC complied with the High Court's direction for a scheduled bank located in India; the High Court erred in directing substitution with a guarantee from a 'Scheduled Indian Bank' in the absence of adverse material regarding ICBC’s credibility, and therefore the Division Bench order and specified High Court orders were set aside. The other Judge (V. Ramasubramanian, J.) held that the matter arose from an offer made in court to furn…
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The Court held that the temporary blanket extension of limitation granted since 15.03.2020 has served its purpose and must end; consequently the period 15.03.2020 to 14.03.2021 is excluded from computation of limitation, affected matters get a residual availability of the balance period from 15.03.2021, and where limitation would have expired in the excluded period all persons have 90 days from 15.03.2021 (or the longer actual balance), with the exclusion expressly applying to specified provisions of arbitration, commercial courts and negotiable instruments statutes; additionally the Governme…
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The arbitration agreement contained in the Work Order is independent and separable from the substantive contract and is not rendered non-existent, invalid or unenforceable by non-payment of stamp duty on the substantive contract; alleged civil fraud in the invocation of a bank guarantee is an arbitrable dispute; a writ under Articles 226/227 challenging an order refusing reference to arbitration was not maintainable where an appeal under amended Section 37 was available.
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