Civil Procedure - The Legal Chamber

Supreme Court Ruling: Defective Affidavit Can Be Corrected in Insolvency Petitions

10Feb

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Ruling: Defective Affidavit Can Be Corrected in Insolvency Petitions

The Supreme Court held that a defective affidavit filed in support of a Section 7 IBC application is a curable procedural irregularity and does not render the application non est. The Court emphasized that the mandatory notice under Section 7(5)(b) of the IBC must be specifically issued to the applicant before rejection, and procedural rules should not defeat substantive rights. Facts Of The Case: HDFC Bank filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Livein Aqua Solutions Pvt. Ltd. for a defaulted loan of ₹5.5 crores. The application, verified on July 26, 2023, was supported by an affidavit deposed on July 17, 2023. The NCLT Ahmedabad Bench rejected the petition at the threshold, citing this date discrepancy in the affidavit as a fatal ...

Supreme Court: Subsequent Contracts Don’t Override Original Arbitration Agreement

9Feb

By The Legal ChamberNo Comments

Supreme Court

Supreme Court: Subsequent Contracts Don’t Override Original Arbitration Agreement

The Supreme Court held that Part I of the Arbitration & Conciliation Act, 1996, including Section 11, does not apply to a foreign-seated international commercial arbitration. The arbitration clause in the principal "mother agreement" governs, and subsequent ancillary contracts with different parties cannot novate it or confer jurisdiction on Indian courts. Facts Of The Case: The petitioner, Balaji Steel Trade, entered into a Buyer and Seller Agreement (BSA) dated 06.06.2019 with respondent no. 1, Fludor Benin S.A., for the supply of cottonseed cake, containing an arbitration clause specifying arbitration in Benin. An Addendum was later executed. Subsequently, respondent no. 1 assigned its supply obligations. The petitioner then entered into separate Sales Contracts with r...

Landmark Ruling: Supreme Court Clarifies Grounds for Rejecting a Plaint Under Order VII Rule 11

9Feb

By The Legal ChamberNo Comments

Supreme Court

Landmark Ruling: Supreme Court Clarifies Grounds for Rejecting a Plaint Under Order VII Rule 11

The Supreme Court upheld the High Court's decision to restore the suit, affirming that rejection of a plaint under Order VII Rule 11 CPC is a threshold scrutiny. Contentions regarding cause of action, limitation, and res judicata are mixed questions requiring a full trial, not adjudication at the preliminary stage. Facts Of The Case: The case originated from a civil suit (O.S. No.26246 of 2023) filed by the respondents (Archbishop of Bangalore & Others) against the appellant, C.M. Meenakshi, and others. The plaintiffs sought a declaration of absolute ownership over a scheduled property in Bangalore, cancellation of two sale deeds from 2014 and 2020, and permanent injunctions to prevent any alteration or alienation of the property. During the suit's pendency, defendants 1 to 8 f...

Supreme Court: Decree for Specific Performance Does Not Create Title, So Assignment Deed Need Not Be Registered

6Feb

By The Legal ChamberNo Comments

Supreme Court

Supreme Court: Decree for Specific Performance Does Not Create Title, So Assignment Deed Need Not Be Registered

The Supreme Court held that a deed assigning a decree for specific performance of a sale agreement concerning immovable property does not require mandatory registration under Section 17(1)(e) of the Registration Act, 1908. This is because such a decree does not itself create, assign, or extinguish any right, title, or interest in the immovable property; it merely confers a right to seek performance through court execution. Facts Of The Case: The appellants are the legal heirs of a judgment-debtor against whom an ex-parte decree for specific performance of a sale agreement concerning immovable property was passed on 13.09.1993. The first respondent, Shanmugam, claimed to be the assignee of this decree by virtue of an assignment deed dated 17.07.1995. In 2004, the assignee filed an e...

Key Ruling on Vakalatnama & “No Instructions”: Supreme Court Clarifies Lawyer-Client Procedure in Civil Cases

4Feb

By The Legal ChamberNo Comments

Supreme Court

Key Ruling on Vakalatnama & “No Instructions”: Supreme Court Clarifies Lawyer-Client Procedure in Civil Cases

The Supreme Court clarified that a counsel’s “no instruction” pursis does not equate to withdrawal of vakalatnama under the Advocates Act or Civil Manual. Absent a formal withdrawal, the court is not obligated to issue fresh notice; a litigant’s failure to instruct counsel cannot invalidate proceedings. The High Court’s interference under Article 227 was deemed unwarranted. Facts Of The Case: The appellant, Shri Digant, filed a civil suit in 2014 against the respondents, M/s. P.D.T. Trading Co. & Ors., for possession under the Maharashtra Rent Control Act, 1999. The defendants were initially served summons, and after they failed to appear, the suit proceeded ex parte. Upon applications, these ex parte orders were later recalled, and the defendants filed written statements. Duri...

Supreme Court Rules: Counter-Claim Against Co-Defendant Not Allowed

2Feb

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Rules: Counter-Claim Against Co-Defendant Not Allowed

The Supreme Court held that a counter-claim by impleaded defendants against a co-defendant is not maintainable in a suit for specific performance. Such a claim must be incidental to the original suit's cause of action and cannot be independently raised against another defendant. The Court set aside the admitted counter-claim. Facts Of The Case: The appellant, Sanjay Tiwari, filed a suit for specific performance against the first respondent, Yugal Kishore Prasad Sao, based on an alleged oral agreement dated 02.12.2002 for the sale of 0.93 acres of land. The plaintiff claimed full payment was made and he was put in possession. The first defendant, in his written statement, contended that defendants 2 and 3 were in possession of part of the property, making the suit defective for non-joinde...

Specific Performance Upheld: Supreme Court Reinstates Decree in Property Dispute

15Jan

By The Legal ChamberNo Comments

Supreme Court

Specific Performance Upheld: Supreme Court Reinstates Decree in Property Dispute

The Supreme Court held that the High Court exceeded its jurisdiction under Section 100 CPC by interfering with the first appellate court's findings of fact, particularly regarding additional payment and the plaintiff's readiness and willingness. The Court reiterated that time is not ordinarily the essence in immovable property contracts and that acceptance of further payment post-deadline constitutes a waiver of the right to forfeit earnest money, making the suit for specific performance maintainable without a separate declaratory relief. Facts Of The Case: The appellant, Annamalai, entered into a registered sale agreement dated 08.01.2010 with Saraswathi (D-1) and Dharmalingam (D-2) for two property items. The total consideration was Rs. 4,80,000, of which Rs. 4,70,000 was paid as a...

Landmark Ruling Protects IP Owners: Supreme Court Says Continuous Infringement Creates Inherent Urgency

4Jan

By The Legal ChamberNo Comments

Supreme Court

Landmark Ruling Protects IP Owners: Supreme Court Says Continuous Infringement Creates Inherent Urgency

This Supreme Court judgment clarifies that under Section 12A of the Commercial Courts Act, a suit alleging continuing infringement of intellectual property rights inherently contemplates urgent interim relief. The Court held that mere delay in filing the suit does not negate urgency, as each ongoing act of infringement causes immediate and irreparable harm, and public interest in preventing market deception also factors into the assessment. Facts Of The Case: The appellant, a Danish company named Novenco Building and Industry A/S, held patents and design registrations in India for its industrial fans sold under the brand ‘Novenco ZerAx’. It had entered into a dealership agreement with respondent No. 1, Xero Energy Engineering Solutions Pvt. Ltd., in 2017. The appellant later discov...

Supreme Court Explains Why: Can’t File Contempt in Supreme Court for Violating High Court Order

29Dec

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Explains Why: Can’t File Contempt in Supreme Court for Violating High Court Order

This Supreme Court judgment clarifies that the doctrine of merger is not of universal application. It holds that where the Supreme Court permits withdrawal of an intra-court appeal, the parties revert to the status under the original High Court Single Judge order. Consequently, contempt for its violation lies before the High Court, not the Supreme Court. Facts Of The Case: The petitioner, M/s Khurana Brothers, initially challenged an order of a Single Judge of the Uttarakhand High Court by filing an intra-court appeal before a Division Bench. While the Division Bench dismissed this appeal, it made certain observations that, according to the petitioner, worsened its legal position compared to the Single Judge's order. The petitioner then sought and was granted leave to appeal to t...

Supreme Court Clarifies: Trustees Can Be Sued for Dishonored Cheques, Even If Trust Is Not Named as Accused

24Dec

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Clarifies: Trustees Can Be Sued for Dishonored Cheques, Even If Trust Is Not Named as Accused

This Supreme Court judgment holds that under the Negotiable Instruments Act, 1881, a Trust is not a juristic person capable of being sued. A complaint for a dishonored cheque issued on behalf of a Trust is maintainable against the Trustee who signed it, without needing to array the Trust itself as an accused. The ruling clarifies that vicarious liability attaches directly to the responsible Trustee. Facts Of The Case: The dispute arose from a financial arrangement concerning William Carey University. Facing a crisis, its sponsoring body, ACTS Group, entered an MoU with Orion Education Trust on 12.10.2017 to hand over the university's management. The Respondent, Vijaykumar Agarwal, was Orion's Chairman. In this capacity, he authorized the Appellant, Sankar Padam Thapa, to liaise wit...