Frost Intl Ltd vs Milan Developers and Builders (P) Ltd & Anr

Case Name : M/s Frost International Limited vs M/s Milan Developers and Builders (P) Limited & Anr Case Reference: (2022) LiveLaw SC 340 Case Number: CA 1689/2022 Court: Supreme Court Bench: 02 Coram: MR Shah ; BV Nagarathna (Author) Date: 01.04.2022

Reading of the plaint for the purpose of O VII rule 11 must be meaningful and not format and such a reading of the plaint must show that it is manifestly vexatious and meritless in not disclosing right to sue. Clever drafting may create illusion of cause of action which should be nipped in the bud at the first hearing by examining the party. Purpose of conferment of power under O VII rule 11 is that litigation which is meaningless and bound to prove abortive should not be permitted to occupy time of the court and exercise of respondent. Sword of Damocles need not be kept hanging over respondent’s head unnecessarily without point or purpose. O VII rule 11 laws down independent remedy to challenge maintainability of suit irrespective of right to contest the same on merits. There is a duty case on the Court to perform its obligations in rejecting the plaint when the same is hit by the infirmities in Rule 11, even without intervention of the defendant. For the purpose of O VII rule 11, the averments in the plaint in their entirety must be held to be correct and to assess if the averments are taken to be correct, would a decree be passed. The plaint must be construed as it stands without any amendments. Averments in written statement and contentions of defendant are wholly immaterial while considering prayer for rejection of plaint. In exercise of power under O VII rule 11, court to determine if assertions made in the plaint are contrary to statutory law or judicial dicta for deciding whether a case for rejecting the plaint at the threshold is made out. It is not permissible to cull out a sentence or passage and read it in isolation. The substance, and not merely the form has to be looked into. The plaint has to be construed as it stands without addition or subtraction of words. If allegations in the plaint prima facie show a cause of action, court cannot embark upon an enquiry whether the allegations are true in fact. The power under O VII rule 11 can be exercised by the Court at any stage in the suit, either before registering the plaint or after issuing summons to the defendant, or before conclusion of the trial.

Omission on part of plaintiff to pray for further consequential relief is relevant only at the time of final adjudication of suit.

No plaintiff can be permitted to seek relief in a suit which would frustrate defendants from initiating prosecution against plaintiff or seeking any other remedy available in law. The equitable principle underlying Section 41(b) SRA which deals with perpetual conjunction; it has nothing to do with section 37 CPC. A superior court can injunct person by restraining him from instituting or prosecuting proceedings before subordinate court; save for this specific carving out of area where access to justice may be impeded by court injunction; Legislature desired that court ordinarily should not impeded access to justice. Refer also to Section 41(d) SRA. Suit to restrain criminal proceedings being instituted is not maintainable; principle also applicable to Section 138 NI Act; an order of injunction cannot be granted and hands of criminal court cannot be fettered by the civil court.

There is a rebuttable presumption that in every negotiable instrument including a cheque was made or drawn for consideration and every such instrument when it has been accepted is for a consideration - as seen in Sections 118(a) and Section 138 of NI Act

Revisional Court and Jurisdiction

Revisional court cannot correct errors of fact or law however gross they may be unless they relate to jurisdiction of court to try the dispute. Plea of limitation and plea of res judiciata are pleas of law which concern jurisdiction of court to try proceedings.

Refer also:

1. Pandurang Dhondi Chougula & Ors vs Maruti Hari Jadhav & Ors, AIR 1966 SC 153
2. Tek Singh vs Shashi Verma, (2019) 16 SCC 678
3. DLF Housing & Construction Co. (P) Ltd vs Sarup Singh, (1969) 3 SCC 807
4. T Arivandandam vs TV Satyapal & Anr, (1977) 4 SCC 467
5. Azhar Hussain vs Rajiv Gandhi, (1986) Supp SCC 315
6. Sopan Sukhde Sable & Ors vs Assistant Chairty Commissioner & Ors, (2004) 3 SCC 137
7. ITC Ltd vs DRAT & Ors, (1998) 2 SCC 70
8. Liverpool and London SP and I Assn Ltd vs MV Sea Success I & Anr, (2004) 9 SCC 512
9. Dahiben vs Arvindbhai Kalyanji Bhanusali (Gajra), (2020) 7 SCC 366
10. Rajendra Bajora & Ors vs Hemant Kumar Jalan & Ors, (2021) SCC OnLine SC 764
11. Hardesh Ores (P) Ltd vs Hede & Co, (2007) 5 SCC 614
12. D Ramachandran vs RV Janakiraman, (1999) 3 SCC 367
13. Saleem Bhai vs State of Maharashtra, (2003) 1 SCC 557
14. Cotton Corporation of India Ltd vs United Industrial Bank Ltd & Ors, (1983) 4 SCC 625
15. Ratna Commercial Enterprises Ltd vs Vasutech Ltd, AIR 2008 Del 99
16. Re NP Essappa Chettiar, AIR 1942 Mad 756
17. Gauri Shanker vs District Board, AIR 1947 All 81
18. Aristo Printers Pvt Ltd vs Purbanchal Trade Centre, AIR 1992 Gau 81
19. State of Orissa vs Madan Gopal Rungta, AIR 1952 SC 12
20. Atul Kumar Singh vs Jalveen Rosha, AIR 2000 Del 38

See also: CPC - Section 37 CPC - Section 115 CPC - Order VII rule 11 CPC - Order X rule 2 NI Act - Section 118 NI Act - Section 138 SRA - Section 34 SRA - Section 41

Judgment: Frost Intl Ltd vs Milan Developers, CA 1689-2022 (SC).pdf