SCA/11469/2006 1/31 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 11469 of 2006 With SPECIAL CIVIL APPLICATION No. 11471 of 2006 With SPECIAL CIVIL APPLICATION No. 16309 of 2006 With CIVIL REVISION APPLICATION No. 66 of 2007 With CIVIL REVISION APPLICATION No. 67 of 2007 For Approval and Signature: HONOURABLE MR.JUSTICE M.R. SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2 To be referred to the Reporter or not ? YES 3 Whether their Lordships wish to see the fair copy of the judgment ? NO 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? NO 5 Whether it is to be circulated to the civil judge ? NO ========================================================= SATELLITE TELEVISION ASIAN REGION LIMITED & 1 - Petitioner(s) Versus KUNVAR AJAY FOODS PVT. LTD. - Respondent(s) ========================================================= Appearance : MR MIHIR THAKORE WITH MR MR CL SONI for Petitioner(s) : 1 - 2. MS KALPANA BRAHMBHATT for Respondent(s) : 1, ========================================================= SCA/11469/2006 2/31 JUDGMENT CORAM : HONOURABLE MR.JUSTICE M.R. SHAH Date : 10/12/2008 ORAL JUDGMENT 1. RULE. Ms.Kalpana Brahmbhatt, learned advocate waives the service of notice of rule on behalf of the respondent – original plaintiff. 2. With the consent of the learned advocates appearing on behalf of the respective parties, all these matters are taken up for final hearing today. 3. As common question of law and facts arise in this group of petitions, they are being disposed of by this Common Judgement and Order. Respective parties will be referred hereinafter as per their position in the respective suit. 4. Special Civil Application No.11469 of 2006 is filed by the petitioners – original defendants of Summary Civil Suit SCA/11469/2006 3/31 JUDGMENT No.69 of 2002 under Article 227 of the Constitution of India for appropriate writ, order and/or direction, quashing and setting aside the impugned order dtd.19/4/2006 passed by the learned 4th Additional Senior Civil Judge, Surat below application Ex.28 in Summary Civil Suit No.69 of 2002, by which the learned trial court has granted conditional leave to the petitioners – defendants to defend the aforesaid suit on condition to deposit Rs.15 Crores in the court. Civil Revision Application No. 66 of 2007 is filed by the petitioner – original plaintiff of Summary Civil Suit No.69 of 2002 challenging the order dtd.19/4/2006 passed by the learned 4th Additional Senior Civil Judge, Surat below application Ex.28 in Summary Civil Suit No.69 of 2002, by which the learned trial court has granted conditional leave to the petitioners – defendants to defend the aforesaid suit on condition to deposit Rs.15 Crores in the court and not allowing the application for Judgement for Summons. 5. Special Civil Application No.11471 of 2006 is filed by the petitioners – original defendants of Summary Civil Suit SCA/11469/2006 4/31 JUDGMENT No.38 of 2003 under Article 227 of the Constitution of India for appropriate writ, order and/or direction, quashing and setting aside the impugned order dtd.19/4/2006 passed by the learned 4th Additional Senior Civil Judge, Surat below application Ex.22 in Summary Civil Suit No.38 of 2003, by which the learned trial court has granted conditional leave to the petitioners – defendants to defend the aforesaid suit on condition to deposit Rs.35 Crores in the court. Civil Revision Application No. 67 of 2007 is filed by the petitioner – original plaintiff of Summary Civil Suit No.38 of 2003 challenging the order dtd.19/4/2006 passed by the learned 4th Additional Senior Civil Judge, Surat below application Ex.22 in Summary Civil Suit No.38 of 2003, by which the learned trial court has granted conditional leave to the petitioners – defendants to defend the aforesaid suit on condition to deposit Rs.35 Crores in the court and not allowing the application for Judgement for Summons. 6. Special Civil Application No.16309 of 2006 is filed by the petitioners – original defendant of Summary Civil Suit SCA/11469/2006 5/31 JUDGMENT No.12 of 2003 under Article 227 of the Constitution of India for appropriate writ, order and/or direction, quashing and setting aside the impugned order dtd.12/6/2006 passed by the learned 4th Additional Senior Civil Judge, Surat below application Ex.14 in Summary Civil Suit No.12 of 2003, by which the learned trial court has granted conditional leave to the petitioners – defendants to defend the aforesaid suit on condition to deposit Rs.5O Lacs in the court. 7. Facts of Special Civil Application No.11469 of 2006 and Civil Revision Application No.66 of 2007 are as under:- The original plaintiff had instituted Summary Suit No.69 of 2002 under Order 37 Rule 2 of the Code of Civil Procedure, in the court of learned Civil Judge (S.D.), Surat against the defendants claiming damages of Rs.250 Crores (Rupees Two Hundred Fifty Crores) with an additional prayer for declaration and permanent injunction, inter-alia contending that it has not entered into any contract with the defendants for telecast of advertisement, and though the plaintiff had no direct contract with the defendants, still the petitioners SCA/11469/2006 6/31 JUDGMENT defendants issued a public notice on 14/12/2002 in vernacular news paper stating that Rs.21,96,50,532=00 (Rupees Twenty one Crores Ninety Six Lacs Fifty Thousand Five Hundred Thirty Two only) are due and payable from the plaintiff and therefore, it is alleged that by the said public notice the plaintiff has suffered loss in crores of rupees and therefore, by way of token damages, the aforesaid suit is filed for recovery of Rs.250 Crores. The plaintiff submitted an application Ex.11 titling the said application as Summons for Judgement. However, it appears that the said application was to treat the said suit ex-parte and pass a decree in the said suit on the ground that appearance made by the defendants in the suit is defective. The learned trial court issued the notice upon the defendants in the said application and the defendants submitted application Ex.28 raising contention that the suit is not maintainable under Order 37 of the Code of Civil Procedure and whether such a suit is maintainable as Summary Suit should be decided first. By the said application, the defendants also prayed for granting unconditional leave to them to defend the said suit. The defendants also filed another application Ex.30 under Order 6 Rule 16 and under Order 7 Rule 11 of the SCA/11469/2006 7/31 JUDGMENT Code of Civil Procedure praying for deletion of certain pleadings and for rejection of the plaint. In the meantime, the learned trial court passed the impugned order dtd.9/4/2006 below application Ex.28 and granted conditional leave to the defendants to defend the suit on condition to deposit Rs.15 Crores. Being aggrieved by and dissatisfied with the aforesaid order granting conditional leave to the defendants on condition to deposit Rs.15 Crores and in not granting unconditional leave, the defendants have preferred present Special Civil Application under Article 227 of the Constitution of India. Against the impugned order passed below application Ex.28 in granting conditional leave to the defendant on condition to deposit Rs.15 Crores and in not allowing the application for Summons for Judgement and not decreeing the suit, the original plaintiff has also preferred Civil Revision Application No. 66 of 2007. 8. Facts of Special Civil Application No.11471 of 2006 and Civil Revision Application No.67 of 2007. The original plaintiff had instituted Summary Suit No.38 SCA/11469/2006 8/31 JUDGMENT of 2003 under Order 37 Rule 2 of the Code of Civil Procedure, in the court of learned Civil Judge (S.D.), Surat against the petitioners – original defendants claiming damages of Rs.500 Crores (Rupees Five Hundred Crores) with an additional prayer for declaration and permanent injunction, inter-alia contending that it has not entered into any contract with the defendants for telecast of advertisement, and though the plaintiff had no direct contract with the defendants, still the petitioners defendants issued a public notice on 14/12/2002 in vernacular news paper stating that Rs.96,50,532=00 (Rupees Ninety Six Lacs Fifty Thousand Five Hundred Thirty Two only) are due and payable from the plaintiff and therefore, it is alleged that by the said public notice that the plaintiff had suffered loss in crores of rupees and therefore, by way of Token damages, the aforesaid suit is filed for recovery of Rs.21 Crores. The plaintiff submitted an application Ex.11 titling the said application as Summons for Judgement. However, it appears that the said application is to treat the said suit ex-parte and pass a decree in the said suit on the ground that appearance made by the defendants in the suit is defective. The learned trial court issued the notice upon the defendants SCA/11469/2006 9/31 JUDGMENT in the said application and the defendants submitted application Ex.22 raising contention that such a suit is not maintainable under Order 37 of the Code of Civil Procedure and whether such a suit is maintainable as Summary Suit should be decided first. By the said application, the defendants also prayed for granting unconditional leave to them to defend the said suit. The defendants also filed another application Ex.23 under Order 6 Rule 16 and under Order 7 Rule 11 of the Code of Civil Procedure praying for deletion of certain pleadings and for rejection of the plaint. In the meantime, the learned trial court passed the impugned order below application Ex.22 and granted conditional leave to the defendants to defend the suit on condition to deposit Rs.35 Crores by the impugned order 19/4/2006. Being aggrieved by and dissatisfied with the aforesaid order granting conditional leave to the defendants on condition to deposit Rs.35 Crores and in not granting unconditional leave, the petitioners defendants have preferred present Special Civil Application under Article 227 of the Constitution of India. Against the impugned order passed below SCA/11469/2006 10/31 JUDGMENT application Ex.22 in granting conditional leave to the defendant on condition to deposit Rs.35 Crores and in not allowing the application for Summons for Judgement and not decreeing the suit, the original plaintiff has also preferred Civil Revision Application No. 67 of 2007. 9. Facts of Special Civil Application No.16309 of 2006 are as under:- The respondent herein – original plaintiff had instituted Summary Suit No.12 of 2003 under Order 37 Rule 2 of the Code of Civil Procedure, in the court of learned Civil Judge (S.D.), Surat against the petitioner – original defendant claiming damages of Rs.10 Crores (Rupees Ten Crores) with an additional prayer for declaration and permanent injunction, inter-alia contending that the plaintiff placed an order for releasing their advertisement in DD1 and DD2 with the petitioners defendants in respect of their product “Dandi Namak as well as “Friendly Washing Detergent Powder” and also paid Rs.15 Lacs by way of Demand Draft, however, the defendant did not release any advertisement inspite of repeated requests and even though the defendant deposited the said cheque in its SCA/11469/2006 11/31 JUDGMENT Bank and therefore, the plaintiff was compelled to issue instructions for “Stop Payment” and though the defendants knew about non-release of the advertisement, still gave notice for dishonour of the cheque, to which, the plaintiff gave reply through his advocate that the defendant has caused huge loss to the plaintiff by not releasing the advertisement and that by the said advertisement intending purchaser would have got incentive and the plaintiff would have got a wide publicity and that by non-realease of the advertisement, the plaintiff has suffered minimum loss of Rs.10 Crores and the said suit was also filed to get back cheque of Rs.15 Lacs from the defendants. That in the alternate, it is prayed in the said suit to issue permanent injunction restraining the defendants from using the said cheque in any manner. The plaintiff field application Ex.12 for Summons for Judgement and the defendants filed application Ex.14 for leave to defend and prayed for granting unconditional leave to defend the suit. The learned trial court by the impugned order dtd.12/6/2006 has granted conditional leave to the petitioner defendants to defend the aforesaid suit on condition to deposit Rs.50 Lacs in the court. Being aggrieved by and SCA/11469/2006 12/31 JUDGMENT dissatisfied with the impugned order granting conditional leave to the defendants and in not granting unconditional leave to the defend the suit as prayed for, the original defendants have preferred the present Special Civil Application. 10.Mr.Mihir Thakore, learned Senior Advocate has appeared with Mr.C.L. Soni, learned advocate on behalf of the original defendants in each of the petitions and Ms.Kalpana Brahmbhatt, learned advocate has appeared on behalf of each of the original plaintiff. 11.Mr.Mihir Thakor, learned Senior Advocate appearing on behalf of the original defendants has submitted that the learned trial court has materially erred in not granting unconditional leave to the defendants to defend the respective suits and in granting conditional leave to defend the suits to the defendants on condition to deposit Rs.15 Crores, Rs.35 Crores and Rs.50 Lacs, respectively. It is submitted that the learned trial court has not appreciated the fact that such Summary Suits under Order 37 of the Code of Civil Procedure claiming damages for defamation and for declaration and SCA/11469/2006 13/31 JUDGMENT permanent injunction are not maintainable at all. It is submitted that when such Summary Suits for the relief sought in the aforesaid suits are not maintainable, the learned trial court ought to have granted unconditional leave to the defendants to defend the suits. It is submitted that as such, the learned trial court ought to have decided the application submitted by the defendants Ex.30 and Ex.22 in in Summary Suit Nos.69/02 and 38/03, respectively, and ought to have dismissed the aforesaid suits. It is submitted that in any case whether claim for damages on account of defamation, a Summary Suit is maintainable or not itself is a serious triable issue and therefore, the learned trial court ought to have granted unconditional leave to the respective defendants. It is further submitted by Mr.Mihir Thakore, learned Senior Advocate appearing on behalf of the defendants that even considering the provisions of Order 37 Rule 2 of the Code of Civil Procedure , such Summary Civil Suits are not maintainable. It is submitted that in the Summary Suits Nos.69/02 and 38/03, the respective plaintiffs have prayed for declaration and permanent injunction and similarly in the Summary Suit No.12/03, the plaintiff has also prayed for permanent SCA/11469/2006 14/31 JUDGMENT injunction. It is submitted that as per Order 37 Rule 2, Sub Rule (1)(b) of the Code of Civil Procedure, in a summary suit if the plaintiff desires to proceed further with the said suit, the said suit be instituted by presenting a plaint which shall contain that no relief, which does not fall within the ambit of the said rule has been claimed in the plaint. Therefore, it is submitted that when the relief for declaration and permanent injunction are sought, summary suits are not maintainable under Order 37 of the Code of Civil Procedure. It is also further submitted by Mr.Thakor, learned senior advocate for the defendants that Order 37 applies only where suits are upon Bills of Exchange, Hundi and Promissory Note, suit in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant with or without interest, on a written contract or on an enactment where the sum sought to be recovered is a sum of money or in the nature of a debt other than a penalty; or on a guarantee where claim against the principal is in respect of a debt or liquidated demand only. Therefore, it is submitted that claiming damages for defamation does not come within the ambit of Order 37 of the Code of Civil Procedure and therefore the Summary SCA/11469/2006 15/31 JUDGMENT Suits are not maintainable. Therefore, it is submitted that learned trial court has committed an error in not granting unconditional leave to the respective defendants. 12.It is further submitted by Mr.Thakore, learned senior advocate for the defendants that even Order 37 of the Code of Civil Procedure applies to the certain classes of suits. It is further submitted that suits filed by the respective plaintiffs are for recovery of uncertain damages for defamation and not upon the Bills of Exchange, Hundi or Promissory Notes, nor the plaintiffs have sought the amount to recover the debt or liquidated demand in money payable by the defendants on any written contract in any manner or guarantee and therefore, the aforesaid suits cannot be treated as Summary Suit and no procedure as required to be followed under Order 37 of the Code of Civil Procedure has been followed. It is further submitted that Order 37 Rule 3 of the Code of Civil Procedure provides for appearance of the defendants, to which, Order 37 applies. Therefore, it is submitted that the learned trial court is not justified in granting conditional leave to the defendants in a suit filed by the respective plaintiffs to SCA/11469/2006 16/31 JUDGMENT which Order 37 does not apply. 13.It is also further submitted that even the plaintiffs have not complied with the mandatory requirement for Summons for Judgement under the provisions of Sub Rule 4 of Rule 3 of the Code of Civil Procedure. It is submitted that the same is neither verified nor affirmed by the plaintiff. It is submitted that as such, the learned trial court was not justified in entertaining such application for Summons for Judgement and granting conditional leave to the defendants to defend the suit. Therefore, it is submitted that when the defendants have raised real and triable issues in its application for leave to defend and also questioned the maintainability of the suit filed by the plaintiffs as Summary Suit, the learned trial court ought to have granted unconditional leave to the defendants. 14.It is further submitted that the aforesaid submissions with respect to unconditional leave, are made without prejudice to the rights and contentions of respective defendants in the application Ex.30 in Summary Suit No.69/02 and application Ex.22 in Summary Suit No.38/03 which are filed to reject the plaint. By SCA/11469/2006 17/31 JUDGMENT making above submissions it is requested to allow all these petitions and dismiss the aforesaid Civil Revision Application. 15.All these petitions are opposed by Ms.Kalpana Brahmbhatt, learned advocate appearing on behalf of the respective original plaintiffs. It is submitted that considering the amount involved, the learned trial court has not committed any error in granting conditional leave to defend the aforesaid suits. It is submitted that on the contrary in the facts and circumstances of the case, the learned trial court ought to have allowed the Summons for Judgement and passed the decree as prayed for, as appearances in the aforesaid suits were defective. It is also further submitted that the aforesaid three suits are filed for ascertained amount quantified at Rs.250 Crores, Rs.500 Crores and Rs.10 Crores, respectively. Therefore, when the suits are filed for ascertained sum - damages, Summary Suits are maintainable and therefore, the plaintiffs have rightly instituted Summary Suits under Order 37 of the Code of Civil Procedure and the learned trial court in the facts and circumstances of the case has rightly not granted unconditional leave and granted SCA/11469/2006 18/31 JUDGMENT conditional leave directing the petitioners – defendants to deposit the aforesaid amounts. The impugned orders granting conditional leave to defend, in the facts and circumstances of the case, do not warrant any interference of this Court in exercise of the powers under Article 227 of the Constitution of India. By making above submissions, it is requested to dismiss aforesaid Special Civil Applications and allow aforesaid Civil Revision Applications. 16.Heard the learned advocates appearing on behalf of the respective parties at length. 17.At the outset, it is required to be noted that the respective suits in question are filed by the respective plaintiffs as Summary Suits under Order 37 of the Code of Civil Procedure claiming damages for defamation and for declaration and permanent injunction. In Summary Suit No.69 of 2002, the original plaintiff has prayed the following reliefs in para 13:- (1)Be pleased to award an amount of Rs.2,50,00,00,000 (Rupes Two Thousand Five SCA/11469/2006 19/31 JUDGMENT Thousand Million) with due interest being the amount of damages for defamation from the date of the suit till recovery thereof to the plaintiff from the person and property of the defendants. (2)Be pleased to declare that the defendants ought to have published notice making direct or indirect defamation of the plaintiff. (3)Be pleased to grant permanent injunction restraining the defendants from transferring or selling their all types of rights being intellectual properties with design, copyright patent, logo and their satellite with all articles. (4)Be pleased to grant permanent injunction restraining the defendants from interfering or selling, in any way, their all types of movable – immovable properties, telecast implement etc. from their land. (5)Be pleased to award entire cost of this suit from the defendants. (6)Be pleased to grant such other special or proper relief as may be deemed fit on the facts of this suit. 18.In Summary Suit No.38 of 2003, the original plaintiff has SCA/11469/2006 20/31 JUDGMENT prayed the following reliefs in para 16:- (1)Be pleased to award an amount of Rs.5,00,00,00,000 (Rupees Five Thousand Millions) with due interest being the amount of damages for defamation from the date of suit till recovery thereof to the plaintiff from the person and property of the defendants. (2)Be pleased to declare that the defendants ought not to have published notice making direct or indirect defamation of the plaintiff. (3)Be pleased to grant permanent injunction restraining the defendants from transferring or selling their all types of rights being intellectual properties with design, copyright patent, logo and their satellite with all articles. (4)Be pleased to grant permanent injunction restraining the defendants from transferring or selling, in any way, their all types of movable – immovable properties, telecast implements, etc. from their land. (5)Be pleased to award entire cost of this suit from the defendants. (6)Be pleased to grant such other special or proper relief as may be deemed fit on the facts of this suit. SCA/11469/2006 21/31 JUDGMENT 19.In Summary Suit No.12 of 2003, the original plaintiff has prayed the following reliefs in para 16:- (1)Be pleased to award an amount of Rs.10,00,00,000 (Rupees Ten Crores) with due interest at 18% from the date of suit till recovery thereof to the plaintiff from the person and property of the defendants. (2)Be pleased to pass order directing the defendants to present the cheque No.8403 dated 23/1/2003 drawn on I.C.I.C.I. Bank, Surat Branch, Surat Dummas Road, issued by the plaintiff in the court custody by attachment before the judgement. (3)In the alternative be pleased to grant permanent injunction restraining the defendants from using the said cheque No.8403 dated 23/1/2003 drawn on I.C.I.C.I. Bank, Surat Branch, Surat Dummas Road. (4)Be pleased to award entire cost of this suit from the defendants. (5)Be pleased to grant such other special or proper relief as may be deemed fit on the facts of this suit. 20.Thus, as stated above, the respective plaintiffs have instituted respective Summary Civil Suits under Order 37 SCA/11469/2006 22/31 JUDGMENT of the Code of Civil Procedure claiming decree of Rs.250 Crores, Rs.500 Crores and Rs.10 Crores, by way of damages on the ground of defamation etc. Sub Rule (2) of Rule 1 of Order 37 and Rule 2 of Order 37 of the Code of Civil Procedure are reproduced hereinbelow:- Sub Rule (2) of Rule 1 of Order 37 reads as under:- (2) Subject to the provisions of sub-rule (1), the Order applies to the following classes o suits, namely:- (a) suits upon bills of exchange, hundies and promissory notes; (b) suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising,--- (i) on a written contract, or (ii)on an enactment, where the sum sought to be recovered is a fixed sum of money SCA/11469/2006 23/31 JUDGMENT or in the nature of a debt other than a penalty; or (iii)on a guarantee, where the claim against the principle is in respect