Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2009 Supreme(SC) 1736

2009(7) Supreme 357
SUPREME COURT OF INDIA
R V Raveendran and G S Singhvi, JJ.
Manohar Singh — Appellant
versus
D. S. Sharma & Anr. — Respondents
Civil Appeal No. 7554-7555 of 2009
[Arising out of SLP [C] Nos.2203-2204 of 2008]
Decided on : 13-11-2009

Advocates Appeared:
For the Appellant : Manohar Singh (Appellant – in – person)
For the Respondent:Bharat Sangal, Adv., for the Respondent.

IMPORTANT POINT
Under the scheme of CPC, a suit cannot be dismissed for non-payment of costs. Non-payment of costs results in forfeiture of the right to further prosecute the suit or defence as the case may be.

Headnote:Civil Procedure Code,1908 – Section 35B – Costs for causing delay – Imposition of costs on appellant seeking repeated adjournments – Costs not paid in spite of repeated opportunities- Relying upon Section 35B of CPC trial court dismissed the suit for failure to pay the costs in spite of several Opportunities – Said dismissal order was challenged by way of a revision before High Court – High Court dismissed the appeal – Review application filed by appellant – Dismissed –Appeal – Under the scheme of CPC, a suit cannot be dismissed for non – payment of costs – Non-payment of costs results in forfeiture of the right to further prosecute the suit or defence as the case may be – Award of costs, is an alternative available to the court, instead of dispensing with the cross –examination and closing the evidence of the witness- If the costs levied for seeking an adjournment to cross – examine a witness are not paid, the appropriate course is to close the cross-examination of the witness and prohibit the further prosecution of the suit or the defence, as the case may be by the defaulting party – In this case, plaintiff had harassed the defendants and its witness by seeking repeated adjournments – In view of it, plaintiff’s right to cross-examine DW2 stood forfeited- However, as costs were levied, but were not paid, the court should have closed the evidence of DW2,permitted the defendants to produce any further evidence (without any right to plaintiff to cross –examine such witnesses) and then ought to have proceeded to dispose of the suit on merits by considering the material available and hearing the arguments of defendant – The court could not have dismissed the suit – Impugned judgments of High Court and trial court set aside –Appeal allowed (Paras 8 to 10)
       Facts of the Case :
        Costs were imposed on appellant herein in the instant case for seeking repeated adjournments. Costs were not paid by appellant in spite of repeated opportunities. Relying upon Section 35B of CPC trial court dismissed the suit for failure to pay the costs in spite of several Opportunities .Said dismissal order was challenged by way of a revision before High Court. High Court dismissed the appeal.Review application filed by appellant was also dismissed.
        2. Present appeal has been filed against said order of High Court.
       Findings of the Court :
        Under the scheme of CPC, a suit cannot be dismissed for non-payment of costs. Non-payment of costs results in forfeiture of the right to further prosecute the suit or defence as the case may be. Award of costs, is an alternative available to the court, instead of dispensing with the cross-examination and closing the evidence of the witness. If the costs levied for seeking an adjournment to cross-examine a witness are not paid, the appropriate course is to close the cross-examination of the witness and prohibit the further prosecution of the suit or the defence, as the case may be by the defaulting party. In this case, plaintiff had harassed the defendants and its witness by seeking repeated adjournments. In view of it, plaintiff’s right to cross-examine DW2 stood forfeited. However, as costs were levied, but were not paid, the court should have closed the evidence of DW2,permitted the defendants to produce any further evidence (without any right to plaintiff to cross-examine such witnesses) and then ought to have proceeded to dispose of the suit on merits by considering the material available and hearing the arguments of defendant. The court could not have dismissed the suit.Impugned judgments of High Court and trial court were set aside .Appeal was allowed

JUDGMENT

R.V. Raveendran, J. —

Leave granted. Heard learned counsel.

2. The appellant filed a suit for damages against his erstwhile employer - National Thermal Power Corporation Ltd. (‘NTPC’ for short, second respondent herein) and its then General Manager in the District Court, Delhi. After conclusion of Plaintiff’s evidence, the defendants’ evidence was commenced. On 6.1.2004 the suit was listed for further evidence of defendants. One S. Joseph, (DW 2), whose affidavit had been filed by way of an examination-in-chief, was present in court for being cross-examined by the plaintiff. The plaintiff requested for an adjournment on the ground that his counsel was busy elsewhere. The case was therefore adjourned to the next day (7.1.2004). Again, plaintiff sought time on the ground that his counsel was otherwise busy. When the court asked the plaintiff to cross-examine the said witness, as he had earlier cross-examined DW-1 without the assistance of a counsel, plaintiff refused to do so. The witness had come all the way from Durgapur for giving evidence. The court therefore adjourned the matter to 9.2.2004, subject to payment of costs of Rs.5000 by the plaintiff. On 9.2.2004 also, S. Joseph (DW-2) was present, but the plaintiff sought an adjournment on the ground that he wanted to move an application for transfer of the suit. The request for adjournment was opposed on the ground that the witness had come from Durgapur by air. The suit was however adjourned to 9.3.2004. On 9.3.2004, plaintiff submitted that he had already moved an application for transfer (alleging that he had lost faith in the Presiding Officer). The suit was adjourned to 7.4.2004. The suit was thereafter adjourned to 20.7.2004, 31.8.2004, 5.10.2004, 10.11.2004, 17.1.2005, 23.2.2005, and 7.4.2005 on the ground that the transfer application filed by the plaintiff was pending before the District Judge.

3. On 24.3.2005, the transfer petition filed by the plaintiff was allowed and his suit was withdrawn from the file of Shri O.P. Gupta, Addl. District Judge and assigned to the file of another Additional District Judge, with a direction to the parties to appear on 1.4.2005. On hat day, the new trial Judge directed the plaintiff to deposit Rs.5,000 towards the travel expenses of DW-2 before he could cross-examine DW2. The matter was adjourned to 27.4.2005. On 27.4.2005, the plaintiff filed an application for waiver of costs. That application was dismissed and the case was posted to 27.7.2005 for further evidence. On 27.7.2005, the plaintiff failed to deposit the costs. The court recorded that costs were not paid in spite of repeated opportunities. Relying upon Section 35B of the Code of Civil Procedure (for short ‘the CPC’), the trial court dismissed the suit for failure to pay the costs in spite of several opportunities. The said dismissal order dated 27.7.2005 was challenged by way of a revision before the Delhi High Court. The High Court dismissed the appeal by order dated 21.5.2007. It upheld the decision of the trial court holding that the provisions of section 35B were mandatory and if the costs levied were not paid “the only course open to the court is to disallow the prosecution of the suit” and, that meant the dismissal of the suit. Appellant’s petition for review was dismissed on 7.9.2007. The orders dated 21.5.2007 and 7.9.2007 are challenged in these appeals by special leave.

4. The appellants contended that having regard to the provisions of section 35B of CPC, if costs levied on plaintiff are not paid, the court can only stop further prosecution of the suit by the plaintiff. It is submitted that section 35B does not confer power to dismiss the suit for non- payment of costs. Learned counsel for the second respondent, on the other hand, supported the judgment of the trial court, as affirmed by the High Court.

5. Section 35B of CPC deals with costs for causing delay. Relevant portion of the said section extracted below :

“35B. Costs for causing delay. - (1)

Click Here to Read the rest of this document

2009 Supreme(SC) 1736

2009(7) Supreme 357SUPREME COURT OF INDIAR V Raveendran and G S Singhvi, JJ.Manohar Singh — AppellantversusD. S. Sharma & Anr. — RespondentsCivil Appeal No. 7554-7555 of 2009[Arising out of SLP [C] Nos.2203-2204 of 2008]Decided on : 13-11-2009

IMPORTANT POINT Under the scheme of CPC, a suit cannot be dismissed for non-payment of costs. Non-payment of costs results in forfeiture of the right to further prosecute the suit or defence as the case may be.

2009(7) Supreme 357
SUPREME COURT OF INDIA
R V Raveendran and G S Singhvi, JJ.
Manohar Singh — Appellant
versus
D. S. Sharma & Anr. — Respondents
Civil Appeal No. 7554-7555 of 2009
[Arising out of SLP [C] Nos.2203-2204 of 2008]
Decided on : 13-11-2009

IMPORTANT POINT
Under the scheme of CPC, a suit cannot be dismissed for non-payment of costs. Non-payment of costs results in forfeiture of the right to further prosecute the suit or defence as the case may be.