Order VII Rule 11(d) CPC: Plaint Can Either Be Rejected As A Whole Or Not At All, Reiterates SC [Read Judgment]

Plaint can either be rejected as a whole or not at all, remarked the Supreme Court while reiterating that it is not permissible to reject plaint qua any particular portion of a plaint including against some of the defendant(s) and continue the same against the others.

In this case [Madhav Prasad Aggarwal vs. Axis Bank], the plaintiffs filed a suit against a builder and others including the Axis Bank. The bank filed a Notice of Motion under Order 7 Rule 11(d) of CPC on the ground that the suit(s) against it would be barred by provisions of Section 34 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act. Though the single bench dismissed the said Notice of Motion, the Division bench of the High Court allowed it. It held that the plaint against the bank was not maintainable, being barred by Section 34 of the 2002 Act.

Placing reliance on the judgment in Sejal Glass Limited Vs. Navilan Merchants Private Limited, the plaintiffs approached the Apex Court by filing appeal. They contended that the plaint cannot be rejected only against one of the defendant(s) but it could be rejected as a whole.

The bench comprising Justice AM Khanwilkar and Justice Ajay Rastogi accepted the contention that the relief of rejection of plaint in exercise of powers under Order 7 Rule 11(d) of CPC cannot be pursued only in respect of one of the defendant(s). Holding that the judgment in Sejal Glass Limited (supra) is directly on the point, the bench explained as follows:

In that case, an application was filed by the defendant(s) under Order 7 Rule 11(d) of CPC stating that the plaint disclosed no cause of action. The civil court held that the plaint is to be bifurcated as it did not disclose any cause of action against the director's 14 defendant(s) 2 to 4 therein. On that basis, the High Court had opined that the suit can continue against defendant No.1¬ company alone. The question considered by this Court was whether such a course is open to the civil court in exercise of powers under Order 7 Rule 11(d) of CPC. The Court answered the said question in the negative by adverting to several decisions on the point which had consistently held that the plaint can either be rejected as a whole or not at all. The Court held that it is not permissible to reject plaint qua any particular portion of a plaint including against some of the defendant(s) and continue the same against the others. In no uncertain terms the Court has held that if the plaint survives against certain defendant(s) and/or properties, Order 7 Rule 11(d) of CPC will have no application at all, and the suit as a whole must then proceed to trial.

Applying this dictum to the facts of the present case, the bench said that though some of the reliefs claimed against the bank in the concerned suit is barred by Section 34 of SARFAESI Act or otherwise, such objection can be raised by invoking other remedies including under Order 6 Rule 16 of CPC at the appropriate stage. It said:

Indubitably, the plaint can and must be rejected in exercise of powers under Order 7 Rule 11(d) of CPC on account of noncompliance of mandatory requirements or being replete with any institutional deficiency at the time of presentation of the plaint, ascribable to clauses (a) to (f) of Rule 11 of Order 7 of CPC. In other words, the plaint as presented must proceed as a whole or can be rejected as a whole but not in part. In that sense, the relief claimed by respondent No.1 in the notice of motion(s) which commended to the High Court, is clearly a jurisdictional error. The fact that one or some of the reliefs claimed against respondent No.1 in the concerned suit is barred by Section 34 of 2002 Act or otherwise, such objection can be raised by invoking other remedies including under Order 6 Rule 16 of CPC at the appropriate stage. That can be considered by the Court on its own merits and in accordance with law.

Setting aside the order of the Division bench of the High Court, the bench added:

These appeals must succeed on the sole ground that the principal relief claimed in the notice of motion filed by respondent No.1 to reject the plaint only qua the said respondent and which commended to the High Court, is replete with jurisdictional error. Such a relief "cannot be entertained" in exercise of power under Order 7 Rule 11(d) of CPC. That power is limited to rejection of the plaint as a whole or not at all.   

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