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Supreme Court CPC Digest : Important Civil

Law Judgments Of 2021
LIVELAW NEWS NETWORK 31 Dec 2021 7:58 PM

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12/31/21, 9:53 PM Supreme Court CPC Digest : Important Civil Law Judgments Of 2021

The Code of Civil Procedure, 1908 [CPC] is an important law as far Civil law practitioners

are concerned. Various High Courts have interpreted many provisions of the Code

differently. The following are some of the important judgments delivered by the Supreme

Court which deals with CPC.

Appellate Court's Jurisdiction Under Section 96 CPC Involves Rehearing On Questions

Of Law As Well As Fact: Supreme Court

Also Read - Supreme Court Annual Digest 2021 - Part 3 [Citations 501 to 766]

[Case: Manjula v. Shyamsundar; Citation: LL 2021 SC 52]

A bench comprising Justices S. Abdul Nazeer and Surya Kant observed that an appellate

court's jurisdiction under Section 96 of CPC involves a rehearing of appeal on questions

of law as well as fact. It noted that the provision provides for filing of an appeal from the

decree passed by a court of original jurisdiction and Order 41 Rule 31 of CPC provides
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the guidelines to the appellate court for deciding the appeal. The bench said that the

judgment of the appellate court shall state (a) points for determination; (b) the decision

thereon; (c) the reasons for the decision; and (d) where the decree appealed from is

reversed or varied, the relief to which the appellant is entitled.

Also Read - 100 Major Supreme Court Judgments Of 2021 [Part 3, Judgments 76

-100]

Appellate Court Cannot Permit Production Of Additional Evidence Unless & Until

Procedure Under Order XLI Rules 27-29 CPC Is Followed: Supreme Court

[Case: HS Goutham v. Rama Murthy; Citation: LL 2021 SC 84]

A bench comprising Justices Ashok Bhushan, R. Subhash Reddy and MR Shah observed

that unless and until the procedure under Order XLI Rules 27, 28 and 29 are followed, the

parties to the appeal cannot be permitted to lead additional evidence and/or the

appellate court is not justified to direct the court from whose decree the appeal is

preferred or any other subordinate court, to take such evidence and to send it when taken

to the Appellate Court.

Also Read - 60 Important Judgments Of Delhi High Court In 2021

Timeline For Pronouncement Of Judgment Prescribed In Order XX CPC Does Not Apply

To High Courts: Supreme Court

[Case: SJVNL v. M/s CCC HIM JV & Anr.; Citation: LL 2021 SC 87]

A Bench comprising of Justices RF Nariman and BR Gavai observed that timeline for

pronouncement of judgment prescribed in Order XX of CPC does not apply to the High

Court.
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"It is true, that for the High Courts, no period for pronouncement of judgment is

contemplated either under the Code of Civil Procedure or the Criminal Procedure Code,

but as the pronouncement of the judgment is a part of justice dispensation system, it has
to be without delay," the bench held.

Also Read - 25 Important Judgements And Happenings In The Bombay High Court

From 2021

Parties Who Privately Agree To Settle Disputes Without Court Intervention U/s 89 CPC

Also Entitled To Refund Of Court Fee: Supreme Court

[Case: High Court of Judicature at Madras v. MC Subramaniam; Citation: LL 2021 SC 97]

A bench comprising Justices Mohan M. Shantanagoudar and Vineet Saran held that the

parties who privately agree to settle their dispute outside the modes contemplated under

Section 89 of CPC are also entitled to refund of Court fees. "The narrow interpretation of

Section 89 of CPC and Section 69­A of the 1955 Act sought to be imposed by the
Petitioner would lead to an outcome wherein parties who are referred to a Mediation

Centre or other centres by the Court will be entitled to a full refund of their court fee;

whilst parties who similarly save the Court's time and resources by privately settling their

dispute themselves will be deprived of the same benefit, simply because they did not

require the Court's interference to seek a settlement," the Court observed.

Order VII Rue 11 CPC: Court Has Inherent Power To See That Frivolous Or Vexatious

Litigations Are Not Allowed To Consume Its Time: Supreme Court

[Case: K. Akbar Ali v. K. Umar Khan; Citation: LL 2021 SC 114]

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A Division Bench of Justices Indira Banerjee and Hemant Gupta observed that the

provisions of Order VII Rue 11 [Rejection of Plaint] are not exhaustive and the Court has

the inherent power to see that frivolous or vexatious litigations are not allowed to

consume the time of the Court.

The bench observed that while considering an application under Order VII Rule 11 of the

CPC, the question before the Court is whether the plaint discloses any cause of action or

whether the suit is barred by any law, on the face of the averments contained in the plaint

itself. While considering an application under Order VII Rule 11 of the CPC the Court is

not to look into the strength or weakness of the case of the plaintiff or the defence raised

by the defendant, it added.

Application Under Order IX Rule 13 CPC Can Be Allowed Only When Sufficient Cause Is

Made Out To Set Aside Ex­Parte Decree: Supreme Court

[Case: Subodh Kumar v. Shamim Ahmed; Citation: LL 2021 SC 134]

A bench comprising Justices Ashok Bhushan and R. Subhash Reddy observed that an

application under Order 9 Rule 13 of the Code of Civil Procedure cannot be automatically

granted and can be allowed only when sufficient cause is made out to set aside the ex­-

parte decree.

Second Appeal: Judgment Should Not Be Interfered With By High Court Unless There Is

A Substantial Question Of Law, Reiterates Supreme Court

[Case: Mallanaguoda v. Ninganagouda; Citation: LL 2021 SC 188]

A bench comprising Justices L. Nageswara Rao and S. Ravindra Bhat reiterated that, the

judgment of the First Appellate Court should not be interfered with by the High Court in

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exercise of its jurisdiction under Section 100 of the Code of Civil Procedure, unless there

is a substantial question of law. The First Appellate Court is the final Court on facts

Functional Convenience Of A Party In Commercial Litigations Cannot Be A Ground To

Transfer Case U/s 25 CPC: Supreme Court

[Case: Fumo Chem Pvt. Ltd. v. Raj Process Equipments And Systems Pvt. Ltd.; Citation:

LL 2021 SC 216]

The Bench of Justice Aniruddha Bose observed that functional convenience of one of the

parties in commercial litigations cannot be a ground to transfer under Section 25 of CPC.

"A petitioner seeking transfer of a case involving business-related disputes from one

jurisdiction to another will have to establish some grave difficulty or prejudice in

prosecuting or defending the case in a forum otherwise having power to adjudicate the

cause," it observed.

In this case, the petitioner company sought transfer of a subsequent suit instituted by the

respondents against them in Pune to Ahmedabad. The court noted that the petitioners'

case is largely founded on the claim of having approached a judicial forum before the

respondents did and both the suits emanate from the same set of facts with the same

set of parties.

Supreme Court Directs High Courts To Reconsider And Update Rules Relating To

Execution Of Decrees

[Case: Rahul S Shah v. Jinendra Kumar Gandhi; Citation: LL 2021 SC 232]

A bench comprising former CJI SA Bobde, Justices L. Nageswara Rao and S. Ravindra

Bhat directed the High Courts to reconsider and update all the Rules relating to Execution

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of Decrees, made under exercise of its powers under Article 227 of the Constitution of

India and Section 122 of CPC, within one year.

The Court observed that in suits relating to delivery of possession, the court must

examine the parties to the suit under Order X in relation to third party interest and further

exercise the power under Order XI Rule 14 asking parties to disclose and produce

documents, upon oath, which are in possession of the parties including declaration

pertaining to third party interest in such properties.

Court Cannot Grant Liberty To Amend Plaint While Rejecting It Under Order VII Rule

11(d) CPC

[Case: Sayyed Ayaz Ali v. Prakash G Goyal; Citation: LL 2021 SC 314]

The Supreme Court held that while rejecting a plaint under Order 7 Rule 11(d) of Code of

Civil Procedure, the Court cannot grant liberty to the plaintiff to amend the plaint. The

proviso to Rule 11 covers the cases falling within the ambit of clauses (b) and (c) and

has no application to a rejection of a plaint under Order 7 Rule 11(d), the Bench

comprising Justices DY Chandrachud and MR Shah observed.

Second Appeal, After Its Admission With Formulation Of Substantial Question Of Law,

Cannot Be Disposed Of Summarily

[Case: Ramdas Waydhan Gadlinge (Since Deceased) v. Gyanchand Nanuram Kriplani

(Dead); Citation: LL 2021 SC 340]

A second appeal, after its admission with formulation of substantial question of law,

cannot be disposed of summarily, the Supreme Court has observed. The bench of

Justices Vineet Saran and Dinesh Maheshwari observed that once a second appeal is

admitted, on the High Court being satisfied that a substantial question of law is involved
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in the case and with formulation of that question, the appeal is required to be heard in

terms of Order XLII of Code of Civil Procedure.

Order XLI Rule 22 CPC- Cross Objection Not Necessary To Challenge Adverse Findings

[Case: Saurav Jain v. A. B. P. Design; Citation: LL 2021 SC 354]

The Supreme Court has observed that a party in whose favour a court has decreed the

suit can challenge an adverse finding before the appellate court without a cross

objection. "It is not necessary that a challenge to the adverse findings of the lower court

needs to be made in the form of a memorandum of cross-objection", the bench

comprising Justices DY Chandrachud and MR Shah observed. The Court also observed

that it can entertain new grounds raised for the first time in an appeal under Article 136

of the Constitution if it involves a question of law which does not require adducing

additional evidence.

Not Much Scope For Considering 'Territorial Jurisdiction' Issue In A Transfer Petition

U/s 25 CPC

[Case: Naivedya Associates v. Kriti Nutrients Ltd; Citation: LL 2021 SC 356]

The Supreme Court has observed that there is not much scope of going into the question

of 'territorial jurisdiction' of a court in a Transfer Petition under Section 25 of the Code of

Civil Procedure. This point is required to be urged before the Court in which the suit is

pending, Justice Aniruddha Bose observed while dismissing a transfer petition. In this

case, the petitioner is a defendant in a suit instituted in the Court of District Judge,

Shahdara, Karkardooma Court, New Delhi alleging infringement of trade mark and

copyright.

Res Judicata Is Not A Ground To Reject A Plaint Under Order VII Rule 11(d) CPC
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[Case: Srihari Hanumandas Totala v. Hemant Vithal Kamat; Citation: LL 2021 SC 364]

The Supreme Court has observed that the Res Judicata cannot be a ground for rejection

of the plaint under Order VII Rule 11(d) of the Code of Civil Procedure. "Since an

adjudication of the plea of res judicata requires consideration of the pleadings, issues

and decision in the 'previous suit', such a plea will be beyond the scope of Order 7 Rule

11 (d), where only the statements in the plaint will have to be perused.", the bench

comprising Justices DY Chandrachud and MR Shah observed.

Second Appeal- High Courts Can Exercise Limited Factual Review Under Section 103

CPC

[Case: K.N. Nagarajappa v. H. Narasimha Reddy; Citation: LL 2021 SC 433]

The Supreme Court has observed that High Courts are empowered to exercise limited

factual review under Section 103 of the Code of Civil Procedure. The bench of Justices L.

Nageswara Rao and S. Ravindra Bhat observed that the rule that sans a substantial

question of law, the High Courts cannot interfere with findings of the lower Court or

concurrent findings of fact, is subject to the following two important caveats: First, if the

findings of fact are palpably perverse or outrage the conscience of the court; in other

words, it flies on the face of logic that given the facts on the record, interference would

be justified. Second, where the findings of fact may call for examination and be upset, in

the limited circumstances spelt out in Section 103 CPC.

Commercial Suits & Requirement Of Establishing Reasonable Cause For Non Disclosure

Of Documents Under Order XI Rule 1 (4) CPC

[Case: Sudhir Kumar @ S. Baliyan v. Vinay Kumar G.B; Citation: LL 2021 SC 458]

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The Supreme Court has observed that the requirement under Order XI Rule 1(4) of Code

of Civil Procedure (as applicable to commercial suits) of establishing the reasonable

cause for non disclosure of the documents along with the plaint under shall not be

applicable if it is averred and it is the case of the plaintiff that those documents have

been found subsequently and in fact were not in the plaintiff's power, possession, control

or custody at the time when the plaint was filed.

The Apex Court bench of Justices MR Shah and Aniruddha Bose observed, "However, at

the same time, the requirement of establishing the reasonable cause for non disclosure
of the documents along with the plaint shall not be applicable if it is averred and it is the

case of the plaintiff that those documents have been found subsequently and in fact

were not in the plaintiff's power, possession, control or custody at the time when the

plaint was filed."

Order VII Rule 11 CPC - Plaint Can't Be Rejected If Limitation Is A Mixed Question Of

Law & Fact

[Case: Salim D.Agboatwala and others v.Shamalji Oddavji Thakkar and others; Citation:

LL 2021 SC 476]

The Supreme Court has held that a plaint cannot be rejected under Order VII Rule 11(d)

of the Code of Civil Procedure if the issue of limitation is a mixed question of law and

fact. A bench comprising Justices Hemant Gupta and V Ramasubramaniam observed so

while reversing a Bombay High Court's judgment which had upheld a civil court's order to

reject a plaint. The suit in question was filed essentially to set aside an order passed by

the Agricultural Land Tribunal to issue sale certificate in respect of a tenancy under the

Maharashtra Tenancy and Agricultural Lands Act, 1948.

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Order VII Rule 11 CPC: Plaint Has To Be Rejected If Reliefs Claimed In It Cannot Be

Granted Under Law

[Case: Rajendra Bajoria v. Hemant Kumar Jalan; Citation: LL 2021 SC 483]

The Supreme Court observed that a court has to reject a plaint if it finds that none of the

reliefs sought in it can be granted to the plaintiff under the law. In such a case, it will be

necessary to put an end to the sham litigation so that further judicial time is not wasted,

the bench of Justices L. Nageswara Rao and BR Gavai observed. The court added that

underlying object of Order VII Rule 11 of CPC is that when a plaint does not disclose a

cause of action, the court would not permit the plaintiff to unnecessarily protract the

proceedings.

Section 92 CPC- Judgment In Representative Suit Binds All Parties Interested In The

Trust

[Case: Jamia Masjid v. K V Rudrappa; Citation: LL 2021 SC 491]

The Supreme Court observed that a suit under section 92 CPC is of a representative

character and all persons interested in the Trust would be bound by the judgment in the

suit. Such persons interested would be barred by the principle of res judicata from

instituting a subsequent suit on the same or substantially the same issue, the bench of

Justices DY Chandrachud, Vikram Nath and Hima Kohli observed. The court added that

while deciding on a scheme for administration in a representative suit filed under Section

92 of the CPC the court may, if the title is contested, have to decide if the property in

respect of which the scheme for administration and management is sought belongs to

the Trust.

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Order IX Rule 13 CPC : Supreme Court Holds Defendant Who Refused Summons Not

Entitled To Seek Setting Aside Of Ex-Parte Decree

[Case: Vishwabandhu v. Sri Krishna and another; Citation: LL 2021 SC 517]

The Supreme Court set aside a judgment of the High Court, which had allowed the

setting aside of an ex-parte decree under Order IX Rule 13 of the Code of Civil Procedure.

The bench comprising Justices Uday Umesh Lalit and S Ravindra Bhat noted that Sub-

Rule (5) of Order V Rule 9 of the Code states inter alia that if the defendant or his agent

had refused to take delivery of the postal article containing the summons, the court

issuing the summons shall declare that the summons had been duly served on the

defendant.

First Appellate Court Should Deal With All Issues And Evidence And Follow Procedure

Under CPC

[Case: K. Karuppuraj v. M. Ganesan; Citation: LL 2021 SC 534]

The Supreme Court observed that it is the duty of the First Appellate Court to deal with all

the issues and the evidence led by the parties before recording its findings. First appeals

are to be decided after following the procedure to be followed under the Code of Civil

Procedure, the bench of Justices MR Shah and AS Bopanna observed.

Order VIII Rule 1 CPC - Period For Filing Of Written Statement Is Directory In Civil Suits;

But Mandatory In Commercial Suits

[Case: Shoraj Singh v. Charan Singh; Citation: LL 2021 SC 573]

The Supreme Court observed that the period of 90 days for filing of written statement

under Order VIII Rule 1 of Code of Civil Procedure in civil suits is directory. The bench of

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Justices Hemant Gupta and V. Ramasubramanian held the provisions of Order VIII Rule 1

CPC are mandatory in the Commercial Courts under the Commercial Courts Act, 2015. "It

may be stated herein that the provisions of Order 8 Rule of CPC are mandatory in the
Commercial Courts under the Commercial Courts Act, 2015", the Supreme Court

observed.

Order XXI Rule 16 CPC - Transferee Of Rights In Subject Matter Of Suit Can Apply For

Execution Without Separate Assignment Of Decree

[Case: Vaishno Devi Construction v. Union of India; Citation: LL 2021 SC 580]

The Supreme Court observed that the Explanation to Order XXI Rule 16 of the Code of

Civil Procedure, removed the distinction between an assignment pre-the decree and an

assignment post the decree. Thus, the court observed that there is no bar under Order

XXI Rule 16 against assignee who acquired rights prior to decree from making an

application to execute the decree. The bench comprising Justices Sanjay Kishan Kaul

and BR Gavai observed that the objective of the said amendment is to avoid multifarious

proceedings to determine the issue of assignment and to determine the issue of

assignment in the execution proceedings itself. The bench was hearing an appeal arising

out of a claim based of an assignee of the decree holder in terms of Order XXI Rule 16

CPC ( application for execution by transferee of decree). During the pendency of the

execution proceedings, the decree holder died. The appellants (now before SC) filed

application before the executing court under Section 47 read with Order 22 Rules 1&2 of

the CPC. This claim was based on the basis of an assignment made by the deceased

decree holder (prior to decree). This application was dismissed by the Trial Court, and

later by the High Court.

High Court Cannot Dismiss Second Appeal In Limine Without Assigning Reasons

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[Case: Hasmat Ali v. Amina Bibi and others; Citation: LL 2021 SC 689]

Holding that a High Court cannot dismiss a second appeal filed under Section 100 of the

Code of Civil Procedure in limine without assigning reasons, the Supreme Court remitted

a matter back to the High Court for fresh consideration. A Bench comprising Justices S.

Abdul Nazeer and Krishna Murari observed that if the case does not involve any

substantial question of law, the High Court has no option but to dismiss the appeal.

However, in order to come to a conclusion that the appeal does not involve any

substantial of law, the High Court has to record the reasons.

CPC - Obstructor's Claims Over Decree Property Must Be Determined In Execution

Proceedings And Not In Separate Suit: Supreme Court

[Case: Bangalore Development Authority v. N. Nanjappa and another; Citation: LL 2021

SC 712]

The Supreme Court held that claims raised by an obstructor including questions relating

to right, title or interest in the property in execution proceedings filed by the decree holder

against the judgment debtor, has to be adjudicated upon by the Executing Court in the

execution proceedings itself.

A Bench comprising Justice MR Shah and Justice BV Nagarathna held that in

accordance with Order XXI Rule 101 CPC, an application filed under Order XXI Rule 97

with respect to resistance or obstruction to possession of immovable property have to

be determined by the Court dealing with the application and for that a separate suit is not

required to be filed.

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