Whether time limit to file written statement is mandatory?

image description

 

  • Introduction-   

  Written Statement is pleading of the defendant in the answer of the plaint filed by the plaintiff against him. It is a reply statement of the defendant in a suit especially denying the allegation made against him by the plaintiff in his plaint.

  • Meaning-

The expression ‘written statement ‘has not been defined under the code of civil procedure in this code. It is the term of specific meaning ordinarily signifying a reply to the plaintiff. In other meaning, it is the pleading of the defendant wherein he deals with the material fact alleged by the plaintiff in his plaint and also states any new fact in his favors or takes legal objection against the claim of the plaintiff.

  • Who may file a written statement?     

A written statement may be filed by the defendant or by his duly authorized agent. In the case of more one defendant, the common written statement filed by them must be signed by all of them, but it is sufficient if it is verified by one of them who is of them aware of the facts of the case and is in position to file an affidavit. But a written statement filed by one defendant doesn’t bind other defendants.

  • ISSUE OF SUMMONS- ORDER 5 RULE 1

When a suit has been duly instituted, a summons may be issued to the defendant to appear and answer the claim and to file the writ statement of his defense, if any, within thirty days from the date of service summons on that defendant; Provided that no such summons shall be issued when a defendant has appeal at the presentation of the plaint and admitted the plaintiff's claim Provided further that where the defendant fails to file the written statement wit! the said period of thirty days, he shall be allowed to file the same on such other days as may be specified by the Court for reasons to be recorded in writing, but which shall not be later than ninety days from the date of service of summons.

 

  • The time limit for filing written statement –

 

  1. Order-VIII-, Rule-1. Written statement.- The defendant shall, within thirty days from the date of service of summons on him, present a written statement of his defense:

 Provided that where the defendant fails to file the written statement within the said period of thirty days, he shall be allowed to file the same on such other day, as may be specified by the Court, for reasons to be recorded in writing, but which shall not be later than ninety days from the date of service of summons.

  1. Order-VIII -,Rule-2. New facts must be specially pleaded.-

The defendant must raise by his pleading all matters which show the suit not to be maintainable, or that the transaction is either void or voidable in point of law, and all such grounds of defense as, if not raised, would be likely to take the opposite party by surprise, or would raise issues of fact not arising out of the plaint, as, for instance, fraud, limitation, release payment, performance, of facts showing illegality.

  1. Order-VIII -, Rule-3. Denial to be specific.- 

It shall not be sufficient for a defendant in his written statement to deny generally the grounds alleged by the plaintiff, but the defendant must deal specifically with each allegation of the fact of which he does not admit the truth, except damages.

 

Illustration:

  • A dies intestate and in debt to B. C takes out administration to A’s effects and B buys part of the effects from C. In a suit for the purchase money by C against B, the latter cannot set off the debt against the price, for C fills two different characters, one as the vendor to B, in which he sues B and the other as representative of A.

  •  A sues B on a bill of exchange. B alleges that A has wrongfully neglected to insure B’s goods and is liable to him in compensation which he claims to set off The amount not being ascertained cannot be set-off, A sues B on a bill of exchange for Rs. 500. B holds a judgment against A for Rs. 1000, the two claims being both definite, pecuniary demands may be set off.

  1. Order-VIII -, Rule-6G. Rules relating to a written statement to apply. – 

The rules relating to a written statement by a defendant shall apply to a written statement filed in answer to a counterclaim.                                                                                                                          

  1. Order-VIII -, Rule-10. Procedure when a party fails to present a written statement called for by Court.- 

Where any party from whom a written statement is required under rule 1 or rule 9 fails to present the same within the time permitted or fixed by the Court, as the case may be, the Court shall pronounce judgment against him, or make such order is relating to the suit as it thinks fit and on the pronouncement of such judgment, a decree shall be drawn up.

  • Landmark Judgment-

1. M/s SCG Contracts India Pvt. Ltd. vs. M/s KS Chamankar Infrastructure Pvt. Ltd., C.A. No. 1638/2019

Facts of the case-

  • The brief facts leading to the filing of the appeal before the Apex Court are that M/s SC Contracts India Pvt. Ltd. (“Appellant”) filed a suit against M/s K.S. Chamankar Infrastructure Pvt. Ltd. (“Respondent”) before the Hon’ble High Court of Delhi and claimed a sum of approx. Rs. 6,94,63,114/-.

  • Respondent received the summons of the aforesaid suit on 14.07.2017. Therefore, as per the proviso to Order V Rule, 1 and the proviso of Order VIII Rule 1 of Code of Civil Procedure, 1908 (“Code”), the Respondent was obliged to file its written statement maximum within 120 days to be calculated from 14.07.2017, which expired on 11.11.2017.

  • The Respondent did not file its written statement till 11.11.2017 and instead filed an application under Order VII Rule 11 seeking rejection of the suit. The High Court rejected the application vide its order dated 05.12.2017, though granted the Respondent Time till 15.12.2017 for filing the written statement subject to the cost of Rs. 25,000/-.

Issue-

Whether the written statement could be directed to be taken on record, even though the time limit of 120 days had elapsed from the date of service of summons upon the Defendants?


Judgment-

The Apex Court in order to arrive at a conclusion has duly considered the intention of the legislature and the language used in the abovementioned provisions. The Apex Court has adopted the literal interpretation of the above-mentioned three provisions, wherein a mandatory time limit of 120 days i.e. a period of 30 days from the date of service of summons upon the Defendant and a further grace period of 90 days is provided to file the written statement, subject to costs, which may be imposed by the concerned court. The above provisions further provide that, in an event where the defendant fails to file the written statement within the aforesaid period of 120 days, the right of the defendant shall stand forfeited. The amendment introduced in the form of the proviso to Order VIII Rule 10, prohibits the courts, from extending the time for filing the written statement beyond the period of 120 days. The Hon’ble Apex Court, inter alia, settled three important issues while dealing with the disputes in the present case.

 

  • Time Limit of 120 days to file the written statement is mandatory:

The Hon’ble Court held that in terms of proviso to Order V Rule 1 and provisos to Order VIII Rule 1 and 10, it is abundantly clear that a clear consequence is provided for the failure of a party to file written statement after the lapse of 120 days from the date of serving of the summons in a suit, i.e. the right shall get forfeited. Therefore, the time limit of 120 days provided in the Code, for filing of a written statement, is mandatory in nature. In other words, a written statement, if not filed by a party within the aforesaid period of 120 days, the same shall not be taken on record by the court as the court has no power to extend the period of 120 days.

 

  •  Pendency of application under Order VII Rule 11 is not a valid reason for not filing the written statement within 120 days:

The Apex Court held that the Respondent’s reason for the pendency of application under Order VII Rule 11 could not be said to be a valid ground/ reason to justify the delay in filing the written statement. The Court held that the filing of written statement and application under Order VII Rule 11 are independent of each other and even if the said application is pending adjudication, the Respondent was still bound to file its written statement within 120 days from the date of service of summons.

 

  • Courts cannot abuse their inherent power under Section 151 of the Code:

The Hon’ble Apex Court also held that the courts cannot abuse their inherent powers under Section 151 of the Code to circumvent or bypass the consequences arising from a mandatory procedural provision like in the instant case. The Apex Court also held that the courts do not have any power to condone the delay in filing the written statement beyond the time limit of 120 days and therefore, the order dated 05.12.2017 as well as the order dated 24.09.2018 were set aside and the delayed written statement filed by the Respondent was liable to take off the record. The Hon’ble Apex Court while passing this judgment has not only settled the mandatory nature of the period of 120 days prescribed in the Code to file the written statement in a commercial dispute but has also settled a very important issue i.e. whether the pendency of application under Order VII Rule 11 can be used as a ground to avoid the filing of a written statement.