Source: https://civillawyersindia.wordpress.com/2013/02/
Timestamp: 2019-04-22 12:05:19+00:00

Document:
judgment and decree of the trial court (First Additional District Judge, Bhopal) and decreed the 1st respondent’s monetary claim.
2. Unialkem Fertilizers Limited–2nd respondent in this appeal (hereinafter referred to as `the buyer’) placed a purchase order on M/s. Emmsons International Limited (hereinafter referred to as `the seller’) for supply of 2000 MT of Syrian Rock Phosphate at the rate of Rs. 2100/- per metric ton for an aggregate amount of Rs. 43,86,411/-. The payment terms provided `against 180 days issuance of letter of credit’. On June 18, 1997, at the request of the buyer, a letter of credit for Rs. 43,86,411/- was established by the appellant No. 1 — State Bank of India, Industrial Finance Branch, Bhopal (hereinafter referred to as `the issuing bank’) in favour of the seller; the appellant No. 2 — State Bank of India, New Delhi Main Branch, New Delhi being the advising Bank. The seller supplied the material vide sale invoice, high seas delivery, bills of lading, etc. and the buyer is said to have accepted the documents.
EVIDENCING DISPATCH OF GOODS AS PER THE ATTACHED SHEETS.
INTEGRAL PART OF THIS CREDIT.
– DISCREPANT DOCUMENTS TO BE SENT STRICTLY ON COLLECTION BASIS.
– ALL DOCUMENTS TO INDICATE L/C NO. 0192097 LC 000087 AND DATE 18/06/97.
COMMERCE INSTEAD OF EXISITING POINT NO.
STATE BANK OF INDIA, MAIN BRANCH, NEW DELHI AND ORIENTAL BANK OF COMMERCE, OVERSEAS BANK, NEHRU PLACE, NEW DELHI ALSO INSTEAD OF EXISTING.
5. On July 8, 1997, the issuing bank received negotiated documents under the letter of credit from Oriental Bank of Commerce (hereinafter to be referred as `negotiating bank’) for payment. On that day itself, the issuing bank pointed out the following discrepancies to the negotiating bank : (i) certificate from the negotiating bank mentioning all the terms of credit have not been furnished; (ii) the certificate of Syrian Origin is not issued by Chamber of Commerce.
6. Thereafter, between July 10, 1997 and February 7, 1998, the correspondence ensued through telegrams and letters between the negotiating bank and the issuing bank. According to the negotiating bank, the discrepancies notified by the issuing bank were rectified and the documents complied with the requirement of the credit. On the other hand, the issuing bank continued to insist that the documents were discrepant; the documents presented were not acceptable to it and it was holding the documents on collection basis at the risk and responsibility of the negotiating bank.
7. It was then that the seller brought an action by way of a summary suit for a decree in the sum of Rs. 63,74,356/- (principal amount of Rs. 43,86,411/- and interest of Rs. 19,87,945/-) together with the interest at the rate of 18 per cent per annum from the date of the suit to the date of decree and thereafter the interest at the same rate on decretal amount till realization against the issuing bank and the advising bank. The buyer was impleaded as a formal party.
bank then filed written statement justifying its action of not honouring the credit on diverse grounds, namely; (i) the certificate of origin issued by Chamber of Commerce was different from the certificate of origin dated March 30, 1997 issued by the supplier of the material; (ii) neither the description of goods nor the quantity or weight matched with each other in the above documents; (iii) the certificate of origin has been issued in favour of MMTC and not in favour of the seller; (iv) at the request of the negotiating bank, the documents were retained by it but only on collection basis in order to remit the amount after collecting the same from the buyer and (v) it has acted in accord with Uniform Customs and Practice for Documentary Credits (for short, ` UCP500′).
documents relating to the &quot;letter of credit&quot; against the rules and practice?
basis of letter of credit given by them?
Issue No. 3. Assistance and expenses?
It may be noted that trial court has referred to the seller as applicant and the issuing bank (defendant no. 1) and the advising bank (defendant no. 2) as respondent nos. 1 and 2 respectively.
10. The parties tendered oral as well as documentary evidence in support of their respective case.
12. The seller filed first appeal against the judgment and decree of the trial court before the High Court of Madhya Pradesh. As noted above, the Division Bench of that Court allowed the seller’s appeal and granted a decree to the seller as prayed in the suit.
lading must be the same as the description in the letter of credit, that is, the goods themselves must in each case be described in identical terms, even though the goods differently described in the two documents are, in fact, the same. The Court reiterated, ` . . . . . . a bank issuing or confirming a letter of credit is not concerned with the underlying contract between the buyer and seller. Duties of a bank under a letter of credit are created by the document itself, but in any case it has the power and is subject to the limitations which are given or imposed by it, in the absence of the appropriate provisions in the letter of credit’.
14. Where the customer of bank instructs the bank to open a credit, the bank acts at its peril if it departs from the precise terms of the mandate.
15. Lord Diplock in Commercial Banking Co. of Sydney Ltd. v. Jalsard Pty. Ltd.2 stated at page 286 of the Report that the issuing banker and his correspondent bank have to make decisions as to whether a document which has been tendered by the seller complies with the requirements of a credit.
16. It needs no emphasis that a contract is concluded between the issuing bank and the seller no sooner the bank issues the credit and communicates it to the seller. Under an irrevocable credit the issuing bank gives an unequivocal and binding undertaking to the seller that it will pay against documents/bills drawn in compliance with the terms of credit.
a Banks must examine all documents stipulated in the Credit with reasonable care, to ascertain whether or not they appear, on their face, to be in compliance with the terms and conditions of the Credit. Compliance of the stipulated documents on their face with the terms and conditions of the Credit, shall be determined by international standard banking practice as reflected in these Articles. Documents which appear on their face to be inconsistent with one another will be considered as not appearing on their face to be in compliance with the terms and conditions of the Credit.
Documents not stipulated in the Credit will not be examined by banks. If they receive such documents, they shall return them to the presenter or pass them on without responsibility.
b The Issuing Bank, the Confirming Bank, if any, or a Nominated Bank acting on their behalf, shall each have a reasonable time, not to exceed seven banking days following the day of receipt of the documents, to examine the documents and determine whether to take up or refuse the documents and to inform the party from which it received the documents accordingly.
c . . . . . . .
b Upon receipt of the documents the Issuing Bank and/or Confirming Bank, if any, or a Nominated Bank acting on their behalf, must determine on the basis of the documents alone whether or not they appear on their face to be in compliance with the terms and conditions of the Credit. If the documents appear on their face not to be in compliance with the terms and conditions of the Credit, such banks may refuse to take up the documents.
c If the Issuing Bank determines that the documents appear on their face not to be in compliance with the terms and conditions of the Credit, it may in its sole judgement approach the Applicant for a waiver of the discrepancy(ies). This does not, however, extend the period mentioned in sub. Article 13 (b).
d . i. . . . . . .
ii. Such notice must state all discrepancies in respect of which the bank refuses the documents and must also state whether it is holding the documents at the disposal of, or is returning them to, the presenter.
iii. . . . . . . . .
e If the Issuing Bank and/or Confirming Bank, if any, fails to act in accordance with the provisions of this Article and/or fails to hold the documents at the disposal of, or return them to the presenter, the Issuing Bank and/or Confirming Bank, if any, shall be precluded from claiming that the documents are not in compliance with the terms and conditions of the Credit.
f . . . . . . . . . .
a . . . . . . .
b Issuing Banks shall not require a Claiming Bank to supply a certificate of compliance with the terms and conditions of the Credit to the Reimbursing Bank. c . . . . . . . .
d . . . . . .
18. In light of the above legal position, we heard Mr. R.K. Sanghi, learned counsel for the appellants and Mr. Shyam Divan, learned senior counsel for the 1st respondent for some time. In the course of hearing, however, it transpired that the High Court in its judgment that runs into 56 foolscap pages while reversing the judgment of the trial court, has not at all adverted to issue no. 5 framed by the trial court nor it considered or upset the finding of the trial court on that issue.
19. Mr. Shyam Divan, learned senior counsel for the seller – 1st respondent fairly stated that the finding on issue no. 5 recorded by the trial court has not at all been considered in the impugned judgment although, he strenuously urged that once the discrepancies on the basis of which the issuing bank refused the documents were rectified and the time allowed for encashment had expired, the issuing bank was obliged to honour the letter of credit and the case set up by the issuing bank that the seller had accepted the encashment of bill and document on collection basis was false and frivolous.
address itself to issue no. 5 which surely had bearing on the final outcome of the case.
23. In the case of H.K.N. Swami v. Irshad Basith (Dead) by LRs.5, this Court (at pages 243-244) stated as under : &quot;The first appeal has to be decided on facts as well as on law. In the first appeal parties have the right to be heard both on questions of law as also on facts and the first appellate court is required to address itself to all issues and decide the case by giving reasons. Unfortunately, the High Court, in the present case has not recorded any finding either on facts or on law. Sitting as the first appellate court it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording the finding regarding title………&quot;.
25. The decided cases of this Court in Jagannath6 and H.K.N. Swami5 were noticed by this Court in a later decision in the case of Chinthamani Ammal v. Nandagopal Gounder and Another7.
26. In our view, the High Court failed to follow the fundamental rule governing the exercise of its jurisdiction under Section 96 of the Code of Civil Procedure, 1908 that where the first appellate court reverses the judgment of the trial court, it is required to consider all the issues of law and fact. This flaw vitiates the entire judgment of the High Court. The judgment of the High Court, therefore, cannot be sustained.
27. For the above reasons, we accept the appeal, set aside the impugned judgment of the High Court and restore First Appeal No. 225 of 2002 for re-hearing and fresh decision. All contentions of the parties are kept open to be agitated at the time of the hearing of the first appeal. No order as to costs.
written statement in civil suit.
The defendant shall, within thirty days from the date of service of summons on him, present a written statement of his defence.
Procedure when party falls to present 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 judgement against him, or make such order is relating to the suit as it thinks fit and on the pronouncement of such judgement a decree shall be drawn up.
record on record beyond the period of 90 days.
given by 20.12.2004 A penalty of Rs.15,000/- per day was agreed for delay in delivery.
interest @ 18% per annum from the date of filing of the suit.
i.e. upto 5.8.2006. The next date given for admission/denial of documents was 25.8.2006.
Order 8 R. 10 CPC.
negate the plea that he was not advised by the counsel about the consequences emanating.
The appellant tendered the written statement on 25.8.2006 unsupported by an application.
to extension of time beyond 90 days period.
discretion even on account of the failure of the party to file the written statement.
against the defendant who has not filed the written statement. In Syed Ismail and Anr. v.
Seven Thousand Seven Hundred) he is only making a claim for Rs. 15,00,000/- (Rs.
substantial portion of the claim in the plaint is attributable to the penalty claimed.
months from today. Appeal stands allowed in the above terms.
“Judgement on admissions-(1) Where admissions of fact have been made either in the pleading or otherwise, whether orally or in writing, the Court may at any stage of the suit, either on the application of any party or of its own motion and without waiting for the determination of any other question between the parties, make such order or give such judgment as it may think fit, having regard to such admissions.
2. In a suit for possession and recovery of mesne profit filed by the plaintiff- appellant before the trial Court of Additional District Judge, Delhi, the plaintiff prayed for a decree for possession in its favour on admissions, invoking the Court’s powers under Order XII Rule 6 of the Code of Civil Procedure, 1908. The trial Court examined the prayer and held that the jural relationship of landlord and tenant was admitted between the parties and so was the rate of rent as settled by them. Service of a notice terminating the tenancy of the defendant-respondent also being admitted, the trial Court saw no impediment in decreeing the suit for possession of the suit property. The application filed by the plaintiff- appellant under Order XII Rule 6 of the CPC was accordingly allowed and the suit filed by the plaintiff to the extent it prayed for possession of the suit property decreed in its favour.
3. Aggrieved by the decree passed against the respondent, the respondent filed Regular First Appeal No. 81 of 2009 before the High Court of Delhi which was allowed by the High Court in terms of its order dated 14th March, 2011 reversing the judgment and decree passed by the trial Court and remanding the matter back to the said Court for disposal in accordance with law. The present appeal by special leave assails the correctness of the said judgment.
4. Mr. Nagendra Rai, learned counsel appearing on behalf of the appellant, strenuously argued that the High Court had fallen in error in holding that there was no clear admission by the defendant either regarding the existence of a relationship of landlord and tenant between the parties or the service of notice of termination of tenancy upon the defendant. He referred to the averments made in the plaint and the written statement to buttress his submission that the existence of the tenancy was unequivocally admitted, no matter the defendant-tenant had questioned the validity of the lease deed in her favour for want of stamp duty and registration as required under law. The fact that the lease deed was not registered did not, contended Mr. Rai, make any material difference so long that the defendant had been put in possession of the demised property pursuant to the said document and so long as she held the same as a tenant. The rate of rent was also not disputed by the defendant nor was the service of notice of termination, which aspects alone were relevant and if admitted or proved, sufficient for the Court to decree the suit for the relief of possession. Mr. Rai submitted that the defendant had no doubt disputed the title of plaintiff-appellant and alleged that the land underlying the super structure had vested in the Gram Sabha but any such contention was not available to her in view of Section 116 of the Indian Evidence Act, 1872 that estopped a tenant from denying the title of the landlord. Relying upon the decisions of this Court in Karam Kapahi v. Lal Chand Public Charitable Trust (2010) 4 SCC 753 and Charanjit Lal Mehra v. Kamal Saroj Mahajan (2005) 11 SCC 279, Mr. Rai argued that the High Court ought to have refused any interference with the decree passed by the Court below especially when no triable issue arose for determination by the trial Court.
5. On behalf of the respondent, it was argued that the High Court was justified in holding that the written statement did not contain a clear and unequivocal admission of the relevant aspects, namely the existence of the jural relationship of landlord and tenant between the parties and the termination of the tenancy by service of a notice under Section 106 of the Transfer of Property Act, 1882. According to him, the High Court was also justified in relying upon the decision of this Court in Jeevan Diesels &amp; Electricals Ltd. v. Jasbir Singh Chadha (2010) 6 SCC 601 while reversing the judgment and decree passed by the Court below.
“Judgment on admissions-(1) Where admissions of fact have been made either in the pleading or otherwise, whether orally or in writing, the Court may at any stage of the suit, either on the application of any party or of its own motion and without waiting for the determination of any other question between the parties, make such order or give such judgment as it may think fit, having regard to such admissions.
10. When placed in juxtaposition the averments made in the plaint and the written statement clearly spell out an admission by the defendant that lease agreement dated 10th October 2001 was indeed executed between the parties. It is also evident that the monthly rent was settled at Rs.50,000/- which fact too is clearly admitted by the defendant although according to the defendant, the said amount represented rent for commercial use of the premises and not residential purposes as alleged by the plaintiff. Suffice it to say that the averments made in the written statement clearly accept the existence of the jural relationship of landlord and tenant between the parties no matter the lease agreement was not duly registered. Whether the tenancy was for residential or commercial use of the property is wholly immaterial for the grant of a decree for possession. Even if the premises were let out for commercial and not residential use, the fact remained that the defendant-respondent entered upon and is occupying the property as a tenant under the plaintiff. The nature of this use may be relevant for determination of mesne profits but not for passing of a decree for possession against the defendant.
11. Incidentally, the defendant appears to have raised in the written statement a plea regarding the nature and extent of the super structure also. While the plaintiff’s case is that the super structure as it existed on the date of the lease deed had been let out to the defendant and the defendant had made structural changes without any authorisation, the defendant’s case is that the super structure was constructed by her at her own cost pursuant to some oral agreement between the parties. It is unnecessary for us to delve deep into that aspect of the dispute, for the nature and extent of superstructure or the legality of the changes allegedly made by the defendant is not relevant to the determination of the question whether the existence of tenancy is admitted by the defendant. At any rate, nature and extent of structure whether modified or even re- constructed by the defendant is a matter that can not alter the nature of the possession which the defendant holds in terms of the agreement executed by her. The relationship of the landlord and the tenant remains unaffected even if the tenant has with or without the consent of the landlord made structural changes in the property. Indeed if the tenancy was protected by the rent law and making of structural changes was a ground for eviction recognised by such law, it may have been necessary to examine whether the structure was altered and if so with or without the consent of the parties. That is not the position in the present case. The tenancy in question is not protected under the Rent Control Act having regard to the fact that the rate of rent is more than Rs. 3500/- per month. It is, therefore, of little significance whether any structural change was made by the defendant and if so whether the same was authorised or otherwise. The essence of the matter is that the relationship of the landlord and the tenant is clearly admitted. That is the most significant aspect to be examined by the Court in a suit for possession especially when the plaintiff seeks a decree on the basis of admissions.
14. Far from constituting a denial of the receipt of the notice the above is an admission of the fact that the notice was received by her but the same was not in accordance with Section 106 of the Transfer of Property Act. In fairness to counsel for the tenant-respondent in this appeal, we must record that the order passed by the High Court was not supported on the plea of the notice being illegal for any reason. A copy of the notice in question is on the record and the same does not, in our opinion, suffer from any illegality so as to make it non-est in the eye of law.
17. In the light of the above, the trial Court was, in our view, perfectly justified in decreeing the suit for possession filed by the appellant by invoking its powers under Order XII Rule 6 of the Code of Civil Procedure. Inasmuch as the High Court took a different view ignoring the pleadings and the effect thereof, it committed a mistake.
18. We accordingly allow this appeal, set aside the impugned judgement and order of the High Court and affirm the judgment and decree passed by the trial Court. The Parties are directed to bear their own costs.
19. Keeping in view the fact that the premises in question is being used by the tenant for commercial purposes, we grant to the defendant time till 31st December, 2012 to vacate the same on furnishing an undertaking in usual terms before this Court within four weeks from today. Needless to say that the defendant shall be liable to pay the mesne profit for the period hereby granted at the rate determined by the trial Court.
20. The appeal is allowed accordingly.
counter claim by defendant in civil suit.
Provided that such counter-claim shall not exceed the pecuniary limits of the jurisdiction of the Court.
Through Mr Harish Malhotra, Sr. Adv.
with Ms. Nandni Sahni, Adv.
Ms. Amrit Kaur Oberoi, Adv. for applicant/D-3.
Ms. Sujata Kashyap, Adv. for D-5.
1. By this order, I shall dispose of the application being I.A.
No.3/counter-claimant from the its membership.
4. The issues were framed on 18.05.2010 in the main suit.
application filed by defendant No.3, being I.A.
along with 10 other affidavits of the witnesses.
February 2011 as already explained.
mentioned in paragraph-8 of the application.
defendants No.6 to 10 be impleaded in the suit.
reported in 175 (2010) DLT 66.
(ii) Gastech Process Engineering (India) Pvt. Ltd. vs.
Saipem, reported in 159(2009) DLT 756.
reported in (2009) 2 Supreme Court Cases 409.
witnesses are filed by way of their examination-in-chief.
application even if trial in the matter is commenced.
application is taken on record.
16. The application is disposed of.
additional evidence by way of affidavit and documents also.
for admission/denial of documents on 03.09.2012.
preliminary issue-order 14 rule 2 of CPC.
(1) Notwithstanding that a case may be disposed of on preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues.
(b) a bar to the suit created by any law for the time being in force, and for that purpose may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with the decision on that issue.
For the Defendant: Mr. Arvind Kumar & Ms. Neelam Rathore, Advocates for D-1&2.
Mr. Rajat Aneja, Advocate for D-5/Applicant.
Ms. Padma Priya, Advocate for D-7 / NHAI.
Procedure, 1908 (in short, “CPC”).
which I must refer to right in the beginning.
plaintiffs in response thereto, have filed their replication.
view, would be relevant for the purposes of disposal of the captioned application.
December, 1970 was blessed with three sons. These being: Mr. Hari Kishan Sanghi, Mr.
Sanghi, Mr. Arun Kumar Sanghi alongwith Mr. Sanjay Kumar Sanghi are progeny of Mr.
above, the two branches traced their root to Mahabir Prasad Sanghi.
joint family, it is averred, resided in a tenanted property situated at 61, Darya Ganj, Delhi.
on property nos.1, 2 & 3 out of the funds owned by the joint family.
of the family of Mr. Hari Kishan Sanghi.
Mr. Hari Kishan Sanghi to various tenants on behalf of Ram Kishan Sanghi and family.
an entity by the name of Indian Renewable Energy Development Agency (i.e. M/s.
IREDA) vide lease agreement dated 30.06.1989 at a rent of Rs.45,000/- p.m.
Company Pvt. Ltd., which at that point of time evidently owned the said property.
Subsequently, it is averred, the name was changed to the present name of applicant i.e.
was, however, entrusted to Mr. Hari Kishan Sanghi.
representing to them that the said documentation was required for taxation purposes.
no.10 i.e. National Highway Authority of India (in short „NHAI‟).
Rs.2500/- with a further right to further sub-let.
the main building of Property no.3 to the applicant/RKS @ Rs.2,000/- p.m.
provisions of Section 50 of Delhi Rent Control Act, 1958 (in short, D.R.C.
13.1 By the very same order, directions were passed in IA 12531/2000, whereby Mr.
also argued that the plaintiffs have not as a matter of fact impugned the said lease deeds.
in these circumstances according to Mr. Aneja is not maintainable. It is also urged by Mr.
plaintiffs from leading any evidence contrary to the contents of the said lease deeds.
contend and demonstrate that the veracity of the said lease deeds is squarely challenged.
purpose, I would rely upon the judgment of the Supreme Court in the case Ramesh B.
demurrer. Demurrer is an act of objecting or taking exception or a protest.
did not carry out business within the jurisdiction of the said High Court.
Following the same principle in Indian Mineral & Chemicals Co. V.
leave is liable to be revoked on the point of demurrer.
15. The principle underlying clause (d) of Order 7 Rule 11 is no different.
under in para 10 of the report: (SCC p.515).
from the statement in the plaint to be barred by any law.
barred by any law in force”.
the pleas raised in the written statement or to any piece of evidence.
instant case there was no lease created, the document was created only for tax purposes.
Letters Patent Appeal he was overruled by Maclean, C.J., and Macpherson, J.
and the tenant, the document was never intended to be acted upon.
suit then its decision on other issues arising in the case would be of no avail.
and Shoib Ullah & Ors. Vs. Bhartesh Chandra Jain & Anr. AIR 2003 All. 31.
observations made herein will not impact the merits of the case.
their examination on the date fixed above.
(ii) [Sub-clause (ii) Omitted by Act 66 of 1956, sec. 14 (w.e.f. 1-1-1957)].

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