Back
SUPREME COURT OF INDIA
R.S. BACHAWAT, J.M. SHELAT AND V. BHARGAVA, JJ.
M/s. Hulas Rai Baij Nath, Appellant
Versus
Firm K. B. Bass and Co., Respondent.
Civil Appeal No. 897 of 1964,
D/- 3-5-1967.
Advocates Appeared
Mr. Bishan Narain, Senior Advocate (Mr. M. I. Khowaja, Advocate, with him), for Appellant; Mr. Niren De, Additional Solicitor-General of India, (M/s. M. V. Goswami and Yogeshwar Prasad, Advocates, with him), for Respondent.
WITHDRAWAL OF SUIT - SUIT FOR RENDITION OF ACCOUNTS - RIGHT OF PLAINTIFF TO WITHDRAW - STAGE AT WHICH WITHDRAWAL PERMISSIBLE - ORDER 23, RULE 1, C. P. C.
Fact of the Case:
The respondent firm filed a suit for rendition of accounts against the appellant firm, alleging that the appellant was the commission agent of the respondent and that the accounts between respondent as the principal and appellant as the agent had not been settled since the dealings began in the year 1941 onwards. The appellant contested the suit on various grounds, including that accounts had already been settled and that the respondent owed the appellant a sum of money. During the trial, the respondent applied to withdraw the suit, which the trial court allowed. The appellant filed a revision in the High Court, which dismissed the application. The appellant then appealed to the Supreme Court.
Finding of the Court:
The Supreme Court held that the respondent was entitled to withdraw from the suit and have it dismissed by the application dated 5th May, 1953 at the stage when issues had been framed and some evidence had been recorded, but no preliminary decree for rendition of accounts had yet been passed. The Court held that the language of Order 23, Rule 1, sub-Rule (1), C. P. C., gives an unqualified right to a plaintiff to withdraw from a suit and if no permission to file a fresh suit is sought under sub-rule (2) of that Rule, the plaintiff becomes liable for such costs as the Court may award and becomes precluded from instituting any fresh suit in respect of that subject-matter under sub-Rule (3) of that Rule.
Issues: Whether the respondent was entitled to withdraw from the suit and have it dismissed by the application dated 5th May, 1953 at the stage when issues had been framed and some evidence had been recorded, but no preliminary decree for rendition of accounts had yet been passed.
Ratio Decidendi: The Court held that the right of the plaintiff to withdraw the suit was not at all affected by any vested right existing in favour of the appellant and, consequently, the order passed by the trial Court was perfectly justified.
Final Decision: The appeal was dismissed with costs.
Certainly. Here are the key points derived from the provided legal document:
The right of a plaintiff to withdraw from a suit is unqualified and can be exercised at any stage before a preliminary decree for rendition of accounts is passed, even after issues have been framed and some evidence recorded, provided the court has not yet issued such a decree (!) (!) .
The language of the procedural rule explicitly grants the plaintiff the right to withdraw without needing prior permission, although the court may award costs and bar the plaintiff from filing a subsequent suit on the same subject matter if the withdrawal occurs without seeking permission to file a new suit (!) .
The right to withdraw is not affected by any vested rights in favor of the defendant, especially when the suit is at a stage prior to the passing of a preliminary decree for accounts (!) .
In suits involving principal-agent relationships, the principal typically holds the right to seek rendition of accounts. The agent cannot generally claim a decree for accounts from the principal unless such a right has been specifically established, which was not the case at the stage of withdrawal in this matter (!) .
The timing of the withdrawal is crucial; at the stage when issues have been framed and evidence recorded but before a preliminary decree, the court is generally obliged to allow withdrawal, and refusal would be unjustified unless specific exceptional circumstances are present (!) .
The decision emphasizes that the court’s role is to facilitate the plaintiff’s right to withdraw, and unless there are compelling reasons or legal restrictions, the court should permit such withdrawal, especially at an early stage of the proceedings (!) .
In cases where a preliminary decree has been issued or rights have been definitively declared, withdrawal might have different implications, but such circumstances do not apply in this case (!) .
The appeal was dismissed because the court found that the plaintiff’s right to withdraw was not impeded by any vested rights of the defendant, and the trial court’s decision to allow withdrawal was justified (!) .
These points summarize the legal principles and the factual context regarding the withdrawal of suits at an intermediate stage before a preliminary decree is passed, as discussed in the provided document.
Judgement
BHARGAVA, J. :- The respondent firm, K. B. Bass and Co., instituted a suit on 13th April, 1951, for rendition of accounts against the appellant firm, Messrs Hulas Rai Baij Nath, alleging that the appellant was the commission agent of the respondent and that the accounts between respondent as the principal and appellant as the agent had not been settled since the dealings began in the year 1941 onwards. Tentatively a sum of Rs. 2,100 was claimed in the plaint. In the written statement filed on behalf of the appellant the suit was contested on various grounds; but for the purposes of this appeal we need mention the pleas taken in only two paragraphs 8 and 11. In paragraph 8, it was pleaded that one Lala Shiva Charan, a partner of the respondent firm, had come with a Munim in the month of Agahan last and accounts were fully explained to him as worked out up to Kartik Sudi 15, Sambat 2007. In that statement of account, a sum of Rs. 10,677-14-3 was found due to the appellant from the respondent and the representatives of the respondent asked for two months time for making the payment of the amount found due. It was thus urged that there was no occasion for rendition of accounts and the plaintiff s suit was not fit to proceed according to law. In paragraph 1l, the appellant pleaded that "if, in the opinion of the court, the court has jurisdiction to try the suit and it is necessary to render the accounts, it is equitable that a decree for the amount which may be found due to the contesting defendant, after rendition of accounts, together with costs and interest be passed in favour of the contesting defendant, after necessary court-fee being realized from the defendant." A number of issues were framed and the case was taken up for recording of evidence on several dates of hearing. Some of the issues were even given up during the trial. Ultimately, on 5th May, l953, after a considerable amount of evidence had been recorded, an application was presented on behalf of the plaintiff-respondent for withdrawal of the suit. The ground given for withdrawal was that the respondent firm was in the charge of one Bhagwat Charan who had colluded with the appellant and litigation was going on between the respondent and Bhagwat Charan for effecting partition of the business. Consequently, it was difficult to prosecute the suit. No prayer was made for permission to file a fresh suit. The appellant filed an application objecting to this application for withdrawal. The main ground taken for contesting this application for withdrawal was that, in a suit of this nature, it is permissible to pass a decree in favour of the defendant if, on accounting something is found due to him against the plaintiff, and it followed that, if the defendant paid court fee on the amount which was found due to him from the plaintiff, his position became that of a plaintiff himself end he became entitled to have the accounting done and to obtain a decree. It was urged that the plaintiff s game in withdrawing the suit after protracted duration and considerable expenditure on the part of the defendant was to defeat this right of the defendant. The trial Court held that the right of the plaintiff in this suit to withdraw under Order 23, R. 1 of the Code of Civil Procedure was inherent and such a right could be exercised at any time before judgment. All that the defendant could claim was an order for costs in his favour. The Courts therefore, dismissed the suit, awarding costs of the suit to the appellant. The appellant flied a revision in the High Court of Allahabad against this order, with a prayer that the High Court may set aside the order of the trial Court and remand the suit for trial according to law. The High Court dismissed the application for revision; and the appellant has now come up to this Court in this appeal by special leave.
2. The short question that, in those circumstances, falls for decision is whether the respondent was entitled to withdraw from the
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
