Rajasthan High Court: Previously Returned Suit Can’t Be Re-Instituted Unless A Fresh Suit With New Averments Regarding Cause Of Action Is Presented
The Rajasthan High Court set aside an Order of the Commercial Court, calling it “illegal and without jurisdiction.”
Justice Anoop Kumar Dhand, Rajasthan High Court
The Rajasthan High Court held that the previously returned suit cannot be re-instituted or tried unless and until a fresh suit with new averments regarding the cause of action is presented.
The Court set aside an Order of the Commercial Court, calling it “illegal and without jurisdiction.” The Court directed the Commercial Court to return the plaint to Clay Craft (India) Private Limited (Respondent), to file the same before the "appropriate forum of law."
A Single Bench of Justice Anoop Kumar Dhand held, “Without incorporating the new facts in the plaint, that the defendant is doing its business at Jaipur by copying the product design of the plaintiff and without showing a single averment in any of the paras in the plaint as to how cause of action has arisen at Jaipur, which gave cause to the plaintiff to re-institute the same plaint, which was returned earlier by the same Court when no cause of action has arisen with the plaintiff. Unless and until the new facts are not incorporated in the plaint, about the cause of action, such plaint cannot be entertained.”
Advocate Siddharth Bapna appeared for the Petitioner, while Advocate Chandrashekar P. Patil represented the Respondent.
Brief Facts
Arta Broch Ceramics Private Limited had challenged the Commercial Court's Order on the grounds of territorial jurisdiction. The Respondent had filed a commercial suit, but the Appellant contended that the Commercial Court at Jaipur lacked the territorial jurisdiction to entertain the suit.
Court’s Reasoning
The High Court noted, “For entertaining a plaint and for rejection of a plaint, the contents of the averments made/pleaded in the plaint are required to be seen and if no cause of action has arisen, then the suit can be rejected under Order 7 Rule 11 CPC.”
The Bench remarked, “While exercising the powers under Order 7 Rule 11 CPC, the Court is required to read the averments of the plaint as a whole to find out whether it discloses any cause of action or not. It is only if the averments made in the plaint do not disclose any cause of action, the plaint can be rejected…Likewise, Section 20 CPC specifies the place where suit can be instituted based on the local limits of jurisdiction where defendant resides and where the cause of action arises.”
“Unless and until a fresh suit with new averments regarding the cause of action is presented, the previously returned suit cannot be re-instituted or tried. In the absence of specific pleadings, the Commercial Court cannot entertain a suit that was previously returned, due to lack of jurisdiction, based on the assertions made about the defendant's business in Jaipur in any application submitted under Section 151 CPC. The averments made in any application under Section 151 CPC cannot be considered as part of the formal pleadings in the previous plaint, and therefore, the suit cannot be re-registered on that basis alone,” the Court held.
The Bench explained, “Merely on the basis of certain averments made in the application under Section 151 CPC that the defendant is doing its business by copying the designs of the plaintiff at Jaipur and mere issuance of the bills, vouchers, invoices of the same at Jaipur cannot be a sufficient ground to institute the same suit before the same Court, which earlier returned the same plaint to the plaintiff. A plaint without specific averments, about cause of action, cannot be allowed to be maintained, on the basis of any application submitted under Section 151 CPC.”
Consequently, the Court ordered, “Thus, after passing the order dated 21.01.2021, there was no reason or occasion available with the Commercial Court to entertain the application filed under Section 151 CPC for reinstituting the same returned plaint, without there being any amendments made in the averments in the plaint with regard to the fact that the defendant is running or conducting its business at Jaipur or within the territorial jurisdiction of the Commercial Court.”
Accordingly, the High Court allowed the Petition.
Cause Title: Arta Broch Ceramics Private Limited v. Clay Craft (India) Private Limited (S.B. Civil Writ Petition No. 4354/2021)
Appearance:
Petitioner: Advocates Siddharth Bapna and Meyul Mittal
Respondents: Advocate G.D.Bansal