[Order VII Rule 10 & 10A CPC] Suit In New Court Has To Proceed De Novo On Return of Plaint: SC [Read Judgment]

The Supreme Court has held that, if a plaint is returned under Order VII Rule 10 and 10A of the Code of Civil Procedure for presentation in the court in which it should have been instituted, the suit shall proceed de novo.

Reference

The bench comprising Justice RF Nariman, Navin Sinha and Indira Banerjee were answering a reference made to it in this regard.  Last year, the bench comprising Justices Deepak Gupta and Aniruddha Bose, noticing, apparent conflict between the judgment in Oil and Natural Gas Corporation Ltd.v. Modern Construction [(2014) 1 SCC 648] and Joginder Tuli vs. S. L. Bhatia [(1997) 1 SCC 502], had observed that the former needs reconsideration. It was observed that unless a party can prove that it has been actually prejudiced by some proceedings before the Court not having jurisdiction, it would not be in the larger interest to start the proceedings de novo.

For more details, Read: Should Proceedings In New Court Where 'Returned' Plaint Is Filed Be Started De Novo? SC Refers To Larger Bench 

'Modern Construction' Does Not Require Reconsideration

Answering the reference, the bench said that there is no conflict between these two judgments. It said that as is no discussion of the law in Joginder Tuli, it has no precedential value as laying down any law. The bench said:

"We find no contradiction in the law as laid down in Modern Construction (supra) pronounced after consideration of the law and precedents requiring reconsideration in view of any conflict with Joginder Tuli (supra). Modern Construction (supra) lays down the correct law. We answer the reference accordingly."

Oriental Insurance Company Ltd. vs. Tejparas Associates and Exports Pvt. Ltd Overruled

The Court also overruled the judgment in Oriental Insurance Company Ltd. ((2019) 9 SCC 435),  in which it was held that,  pursuance of the 1977 amendment of the CPC which  inserted Rule 10A to Order VII, it cannot be said that under all circumstances the return of a plaint for presentation before the appropriate court shall be considered as a fresh filing. 

The bench said that he language of Order VII Rule 10-A is in marked contrast to the language of Section 24(2) and Section 25(3) of the Code of Civil Procedure.

"The statutory scheme now becomes clear. In cases dealing with transfer of proceedings from a Court having jurisdiction to another Court, the discretion vested in the Court by Sections 24(2) and 25(3) either to retry the proceedings or proceed from the point at which such proceeding was transferred or withdrawn, is in marked contrast to the scheme under Order VII Rule 10 read with Rule 10-A where no such discretion is given and the proceeding has to commence de novo."

'Modern Construction' Judgment [(2014) 1 SCC 648]

In this judgment, it was held that, in such a situation, after presentation before the court of competent jurisdiction, the plaint is to be considered as a fresh plaint and the trial is to be conducted de novo even if it stood concluded before the court having no competence to try the same. It was thus observed: "If the court where the suit is instituted, is of the view that it has no jurisdiction, the plaint is to be returned in view of the provisions of Order 7 Rule 10 CPC and the plaintiff can present it before the court having competent jurisdiction. In such a factual matrix, the plaintiff is entitled to exclude the period during which he prosecuted the case before the court having no jurisdiction in view of the provisions of Section 14 of the Limitation Act, and may also seek adjustment of court fee paid in that court. However, after presentation before the court of competent jurisdiction, the plaint is to be considered as a fresh plaint and the trial is to be conducted de novo even if it stood concluded before the court having no competence to try the same."

Case name: M/S. EXL CAREERS  vs. FRANKFINN AVIATION SERVICES PRIVATE LIMITED

Case no.: CIVIL APPEAL NO(s). 2904 OF 2020

Coram: Justice RF Nariman, Navin Sinha and Indira Banerjee 

Counsel: Senior Advocates Manoj Swarup and P.S. Patwali

 Click here to Read/Download Judgment

Read Judgment