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Gujarat High Court
Judgename :C.K.BUCH
NILA BAUART ENGINEERING LIMITED - Appellant
Versus
RAJASTHAN URBAN INFRASTRUCTUREPROJECT AVS BUILDING - Respondent
S.C.A. 14998 of 2003
Decided On : 12/23/2003
The natural corollary of Order 23 Rule 1 of Civil Procedure Code is to grant withdrawal. But for such a grant, formal order of granting permission is not required to be passed especially when the defendant No. 1 is present and consents the withdrawal purshis. The withdrawal is complete as soon as the intimation of withdrawal is expressed before the Court. As a rule of prudence and to protect the miscarriage of justice the Court can expect that such a request is expressed in writing. The withdrawal purshis placed before the Court is only required to be recorded and no formal order on withdrawal purshis is necessary. Formal order treating the plaint as disposed of on account of wish to withdraw the suit, is a formality and that formal order can be passed below the plaint, can be passed at any time by the Presiding Officer of the Court being a mere formality.
[Para 24]
(b) Civil Procedure Code, 1908 (Central Act 5 of 1908) - Order 23 Rule 1 - Withdrawal - Award of costs - Order awarding costs is a consequential order and that will have its own independent effect than the effect of withdrawal - Order awarding costs would give rise to a cause which can be agitated either by suit under Sec. 9 of Arbitration Act or by initiating proceeding in terms of 21 of the contract between parties - Consequently order dated 8.10.2003 rejecting application and treating the suit disposed of on account of withdrawal is a legal order and calls for no interference.
Awarding costs to the defendant No. 1 depends on more than one circumstances. Such an order be a consequential order and that will have its own independent effect than the effect of withdrawal. Even for the sake of argument if it is accepted that some obligations which were required to be fulfilled by the defendant No. 1, were not fulfilled in stricto senso, in terms of the minutes drawn in the above said meetings, then it would give rise to a cause which can be agitated either by a suit filed under Sec. 9 of the Arbitration Act or by intiating proceedings in terms of Clause 21 of the contract between the parties.
[Para 25]
If the consequential order awarding cost to the other side is passed, such an order shall have distinct and independent effect and such an order while recording withdrawal passed can be said to be an order having two independent dimensions. Withdrawal shall stand at one place and the award of cost would be an executable order and may give cause to intitiate recovery proceedings. Therefore, this Court is of the view that the order dated 8.10.2003 of rejecting the application and pass order below Exh. 1 treating the suit as disposed of on account of withdrawal purshis on 5.5.2003, is a legal and valid order and the learned Civil Judge while passing that order has not committed any order either legal or jurisdictional. On the contrary it would be appropriate to hold that though the formal order below Exh.1 - plaint is passed on 8.10.2003, the very order shall have an effect of withdrawal from 5.5.2003, the day on which withdrawal purshis was tendered before the Court. The suit filed by the plaintiff, therefore, can be said to have been effectively disposed of as withdrawn on 5.5.2003.
[Para 26]
(c) Constitution of India, 1950 - Arts. 226/227 - Status quo - Order - The act of withdrawal of the suit on 5.5.2003 disentitled the plaintiff to pray any prohibitory order qua the same bank guarantee in the very suit - Therefore, the impugned order under challenge directing the parties to maintain status quo is an order erroneous on the part of the Court - It is failure on the part of the Court in exercise of discretionary jurisdiction properly.
On the contrary while passing the order below Exh. 39, challenged by the defendant No. 1 before this Court by an independent petition is an erroneous order. There was no prohibitory relief in favour of the plaintiff after 5.5.2003 and the plaintiff had no legal right to pray such relief in absence of any formal order of extention of the relief till 30.7.2003. On the contrary the language of the letter dated 22.5.2003 confirms the withdrawal. The act of withdrawal of the suit on 5.5.2003 disentitled the plaintiff to pray any prohibitory order qua the same bank guarantees in the very suit and, therefore, I am inclined to accept the argument of the learned Counsel for the defendant No. 1 that while passing this order under challenge directing the parties to maintain status quo, is an error of law and failure on the part of the Court in exercise of discretionary jurisdiction properly.
[Para 27]
( 1 ) BOTH these petitions have been moved invoking jurisdiction of this court under Articles 226/227 of the Constitution of India seeking appropriate relief by the rival parties of Special Civil Suit No. 202 of 2003 (herein after referred to as the said Suit) pending in the court of learned Civil Judge (SD) at Vadodara in reference to one order passed by the learned Judge below exh. 39 and an order passed below exh. 1- the plaint in reference to one withdrawal purshis exh. 20, filed on 5. 5. 2003.
( 2 ) THE petitioner of SCA No. 14998 of 2003 is the original plaintiff of the said suit filed seeking a declaration and permanent injunction against encashing bank guarantees, wherein the plaintiff had also prayed for temporary injunction. The petitioner of SCA No. 15050 of 2003 is the original defendant no. 1 no. 1 in the said suit. For the sake of convenience petitioner of SCA No. 14998 of 2003 is referred as plaintiff and respondent no. 1 i. e. petitioner of SCA No. 15050 of 2003, is referred as defendant no. 1 in this judgment.
( 3 ) THE defendant no. 1 had preferred caveat application No. 4786 of 2003 on 10. 10. 2003. But thereafter it has moved a substantive petition. Both these petitions centres around a limited dispute and point of law and therefore the learned counsel for the parties submitted that both these petitions may be heard and decided finally at the admission stage only and appropriate orders may kindly be passed , because the order of admission and in turn granting or refusing ad-interim relief in the petition filed by the plaintiff, shall touch the fate of both these petitions. The plaintiff,today is, protected by the interim relief and it is contended that the interim order passed directing parties to maintain status quo , is still in force. On the other hand the contention of the defendant no. 1-Rajasthan Urban Infracture Development Project (hereinaftrer referred to as the said Project) is that the interim protection was never in existence after 5. 5. 2003 till the impugned order below exh. 39 came to be passed by the learned Civil Judge on 8. 10. 2003, and issuance of such direction and that too after rejecting the say of the plaintiff vide ordeer below exh. 20 is a grave error of law.
( 4 ) IN order to appreciate the say of both the petitioners on the point of controversy between them, it is necessary to state the facts relevant for the purpose of this judgment. 4 (I) the plaintiff is a contractor-engineer approved by the Government and doing its business activities at Vadodara and it is a limited company. The defendant no. 1-said Project invited tenders for the construction of Railway Over Bridges (ROB for short) on in Dungerpur near Dalda factory and another at Sanganer Road. Original defendant no. 1s nos, 2,3 and 4 of the said suit are the bankers with whom bank guarantee has been raised in favour of the defendant no. 1 no. 1. The bank guarantees given by defendant no. 1 no. 2- Global Trust Bank, defendant no. 1 no. 3 IDBI Bank and defendant no. 1 no. 4 Punjab National Bank, are the subject matter of the said suit. It is prayed in the said suit that there is a dispute which requires to be referred to arbitration and that may take atleast 90 days for appointment of an arbitrator and commencement of arbitration proceedings. So, till those proceedings were initiated, defendant no. 1 no. 1 should not encash the bank guarantees. It is also prayed that the court should declare that the defendant no. 1 no. 1 has no right to recover the liquidated damages, till the same are not decided by the arbitrator encashing bank guarantees from defendant no. 1s nos 2,3 and 4. It is also the say of the plaintiff that defendant no. 1 no. 2,3 and 4 cannot realised the bank guarantees till the final disposal of dispute between the plaintiff and defendant no. 1 no. 1 by arbitrator. The order granting ad-interim relief was served on all the defendant no. 1. Pending the suit, negotiations were going on between the p
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