LAW RELATING TO SECTION 145 (2) OF THE NEGOTIABLE INSTRUMENTS ACT

 

LAW relating to Section 145 (2) OF The Negotiable Instruments Act

In the complaints relating to cheque bouncing cases, upon framing of notice u/s 251 of Cr.PC, the accused is called upon to specify, if the accused in order to buttress their points, shall be seeking cross examination of complainant witnesses or not? The accused, if it indeed seeks to examine the complainant witness may file application to that effect and also the Court of Magistrate suo moto may direct the complainant witnesses to be cross examined. It is necessary, in view of the fact that the section 138 of Negotiable Instruments Act entailed the punishment of imprisonment upto two years and/ or fine or both and therefore, the offence u/s 138 of Negotiable Instruments Act can no longer be treated as summary trial case, rather , it may be treated as summon trial case and hence, cross examination of complainant witnesses may be necessary. It is often observed that the controversy revolved around the fact that whether the complainant shall have to file evidence affidavit again or the affidavit evidence tendered during pre-summoning complaints cases shall be sufficient and may be read in post summoning stage as well. All such aspects are now settled by different judicial precedents and the same shall be deliberated below.

Before going further, however, since, the aspect of cross examination of complainant witness finds mention in section 145 of Negotiable Instruments Act, more particularly in clause (2) of the Section 145, therefore, it may be for ease to reproduce the section 145 of Negotiable instruments Act. The same is as under:

145. Evidence on affidavit.—

(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), the evidence of the complainant may be given by him on affidavit and may, subject to all just exceptions be read in evidence in any enquiry, trial or other proceeding under the said Code.

(2) The Court may, if it thinks fit, and shall, on the application of the prosecution or the accused, summon and examine any person giving evidence on affidavit as to the facts contained therein.

The Himachal  Pradesh  High  Court in a matter captioned  as Jagdeep Singh vs  Ramesh Singh Cr M M O No. 390 of  2019 has dealt with the penumbra of Section 145(2) of Negotiable Instruments Act. 

In Jagdeep Singh (Supra) during pendency of the proceedings, the accused moved an application under Section 145(2) of the Act, seeking therein permission to cross-examine the complainant stating therein that a false case has been planted by the complainant against him. Learned Court below, vide order dated 22.1.2019, dismissed the aforesaid application, and while dismissing the application, the Court observed that bare assertion of the accused that a false case has been planted against him, is not sufficient to allow his prayer for examination/cross-examination of the complainant. The order passed was ld Magistrate was thus impugned before the High Court of Himachal Pradesh.

The question, before the high court was therefore to ascertain the correct legal position  as to whether in terms of S.145(2) of the Act, it is mandatory for the applicant, seeking cross-examination of the complainant, to assign reason(s) for recalling/re-examination/cross-examination of the complainant. The high court had noted that careful perusal of Section 145 (1) reveals that notwithstanding anything contained in the Code of Criminal Procedure, 1973, the evidence of the complainant may be given by him on affidavit and same, subject to all just exceptions can be read in evidence in any enquiry, trial or other proceeding under the said Code. The Section 145(2) further provides that the Court may, if it .thinks fit, and shall, on the application of the prosecution or the accused, summon and examine any person giving evidence on affidavit as to the facts contained therein.

It was further held that if the aforesaid provision is closely scrutinized , section 145(2) clearly reveals that it is in two parts, first part provides that the court, of its own, may summon accused to examine him with regard to the contents contained in the affidavit given by him in his evidence, whereas second part casts a duty upon the court to summon a person, who has given evidence by way of affidavit, if application is made for this purpose by the opposite party. Aforesaid provision nowhere suggests that a party making application under this provision of law, is required to assign reasons for summoning the person, who has given evidence by way of affidavit. No doubt, Section 145 (1), as has been taken note herein above, provides that notwithstanding anything contained in the Code, evidence of the complainant can be given by him on affidavit, but this provision further provides that the evidence given by way of affidavit may be read subject to all just exceptions in evidence, in any enquiry, trial or proceedings under the said Code.

Section 145 (2) expressly provides that a court may, if it thinks fit, summon and examine any person, giving evidence on affidavit. Affidavit filed by the person, who is summoned is already on record in the nature of examination-in-chief, hence, on being summoned on the application made by the accused, deponent of the affidavit (complainant or any of its witnesses) can only be subjected to cross-examination as to the facts stated in the affidavit and may not be called upon to file another affidavit for the purpose of cross examination.

The further reliance in this context may be have from a judgment rendered by Hon'ble Supreme Court in  Mandvi Cooperative Bank Ltd Vs Nimesh B. Thakore (2010) 3 SCC 83. The para 30 , in this regard shall be of importance:

"30. Nevertheless, the submissions made on behalf of the parties must be taken note of and properly dealt with. Mr Ranjit Kumar, learned Senior Advocate, appearing for the appellant in appeal arising from SLP (Crl.) No. 4760/2006 pointed out that sub-section (2) of Section 145 uses both the words, "may" (with reference to the court) and "shall" (with reference to the prosecution or the accused). It was, therefore, beyond doubt that in the event an application is made by the accused, the court would be obliged to summon the person giving evidence on affidavit in terms of Section 145(1) without having any discretion in the matter. There can be no disagreement with this part of the submission but the question is when the person who has given his evidence on affidavit appears in court, whether it is also open to the accused to insist that before cross-examining him as to the facts stated in the affidavit he must first depose in examination-in-chief and be required to verbally state what is already said in the affidavit”.

What Section 145 (2) of the Act reveals is just that, the court may, at its discretion, call a person giving his evidence on affidavit and examine him as to the facts contained therein. But, if an application is made either by the prosecution or by the accused the court must call the person giving his evidence on affidavit, again to be examined as to the facts contained therein. What would be the extent and nature of examination in each case is a different matter and that has to be reasonably construed in light of the provision of Section 145 (1) and having regard to the object and purpose of the entire scheme of Section 143 to 146. The scheme of Sections 143 to 146 does not in any way affect the judge's powers under Section 165 of the Evidence Act. If Section 145 (2) is perused, it expressly provides that the court may, if it thinks fit, summon and examine any person giving evidence on affidavit. The affidavit of the person so summoned that is already on the record is obviously in the nature of examination-in-chief. Hence, on being summoned on the application made by the accused the deponent of the affidavit (the complainant or any of his witnesses) can only be subjected to cross-examination as to the facts stated in the affidavit.

Subsequent, to aforesaid judgment, the Hon'ble Supreme Court in Indian Bank Association Vs Union Bank of India (2014) 5 SCC 590, while taking note of the aforesaid judgment rendered in Mandvi Cooperative Bank (Supra) reiterated that even if Legislature in their wisdom have deemed it not appropriate to incorporate "accused" with the word "complainant" in Section 145(1). It does not mean that the Magistrate could not allow the accused to give his evidence on affidavit, unless there was just and reasonable ground to refuse such permission. The Supreme Court also referred to judgment rendered in  Radhey Shyam Garg Vs Naresh Kumar Gupta (2009) 13 SCC 201, wherein it was observed that the words, "examine any person giving evidence on affidavit as to the facts contained therein, in the event, the deponent is summoned by the court in terms of sub-section (2) of Section 145 of the Act", would mean for the purpose of cross-examination. Thus, according to Supreme Court, the affidavit and the documents filed by the complainant along with complaint for taking cognizance of the offence are good enough to be read in evidence at both the stages i.e. pre-summoning stage and the post-summoning stage. In other words, there is no necessity to recall and re-examine the complaint after summoning of accused, unless the Magistrate passes a specific order as to why the complainant is to be recalled. Such an order is to be passed either on an application made by the accused or under Section 145 (2) of the Act or suo motu by the Court.

In Jagdeep Singh (Supra) the Himachal Pradesh High Court has held that the defence plea raised by the accused is neither substantial nor specific, hence, the application u/s 145(2) of negotiable instruments Act preferred by the accused was rightly dismissed. However, a careful perusal of the second part of Section 145(2),  nowhere talks about assigning reasons in the application for recall/re- examination of a witness, meaning thereby that it is obligatory for the court to recall complainant or its witnesses, if an application is made in that behalf. The High Court thus held that in any case, if complainant and its witnesses are cross-examined on the specific points, this would help the court below to effectively adjudicate upon the controversy inter se parties and moreover, no prejudice, whatsoever, would be caused to the complainant, in case complainant and/or his witnesses are examined/cross-examined, rather, this would enable court below to render proper adjudication of the controversy inter se parties. The petition filed by the accused for seeking cross examination of complainant witness was therefore allowed.

What therefore clearly emerged is that under Section 145 of the Act, the complainant can give his evidence by way of an affidavit and such affidavit shall be read in evidence in any inquiry, trial or other proceedings in the Court, which makes it clear that a complainant is not required to examine himself twice i.e. one after filing the complaint and one after summoning of the accused. The affidavit and the exhibits or documents filed earlier by the complainant along when the cognizance of the offence may have been taken, should be good enough to be read in evidence at both the stages i.e. pre-summoning stage and the post summoning stage and that there is no requirement to recall and re- examine the complaint after summoning of accused, unless the Magistrate passes a specific order as to why the complainant is to be recalled. Such an order is to be passed on an application made by the accused or under Section 145 (2) of the Act, suo moto by the Court. In summary trial, after the accused is summoned, his plea is to be recorded under Section 263(g) Cr.P.C and his examination, if any, can be done by a Magistrate and a finding can be given by the Court, under Section 263(h) Cr.P.C and the same procedure can be followed by a Magistrate for offence of dishonour of cheque, since, offence under Section 138 of the Act is a document based offence. If the proviso (a), (b) & (c) to Section 138 of the Act are shown to have been complied with, technically the commission of the offence stands completed and it is for the accused to show that no offence could have been committed by him for specific reasons and defences. Therefore, though, there is no necessity to recall and re-examine complainant, but Magistrate can pass a specific order to recall the complainant, since, onus of rebuttal of the complaint case u/s 139 of Negotiable Instruments Act shall be on the accused and the accused, then, by virtue of cross examination of complainant’s witness shall endeavour to discharge tat onus so as to shift the onus further on the complainant and therefore, re-examination of the complainant witness whether upon filing of application u/s 145(2) of Negotiable instruments Act and pursuant to suo moto order passed by the Court shall be necessary for just disposal of the case. Such an order is to be passed either on an application made by the accused under Section 145(2) of the Act or suo motu by the Court.

                                   --------

Anil K Khaware

Founder & Senior Associate

Societylawandjustice.com                   

NO TIME LIMIT FOR FILING AMENDED WRITTEN STATEMENT?

 

No time limit for filing amended written statement?

In a civil suit filing of a written statement by the defendant stipulates a time limit of 30 days and that may be extended to another 90 (Ninety days) , totaling to 120 days, provided sufficient cause is shown for delay in filing written statement and an application to that effect for seeking condonation of delay is preferred and subject to such terms as Court may deems fit and appropriate, the delay can be condoned. However, any delay beyond 120 days in filing written statement cannot be condoned. In commercial suits, non filing of written statement within 120 days may invite passing of judgment and decree straightway. In general suits, also, delay in filing written statement beyond 120 days is not liable to be condoned in the backdrop of Delhi High Court( Original Side Rules), which shall be dealt with in a while. In such an eventuality, the defence of the defendant could be struck off. As stated in the case of Commercial Suit under the Commercial Courts act 2015, if written statement is not filed within 120 days, then, plaintiff may be entitled to judgment and decree forthwith, since, the rigour of operation of law is more pronounce in the case of Commercial cases.

There may be cases in a suit, where plaint is amended after application for seeking amendment under Order 6 Rule 17 of Code of Civil Procedure is filed and allowed. There may also be situation that the amendments in the plaint are carried out much after filing of written statement. Naturally, in this context, amended written statement shall have to be filed. The question now arises, whether, written statement to amended plaint shall also have prescription of 120 days as a statutory limit or there are no such limits prescribed in the case of filing amended written statement to such amended plaint?  The answer to the aforesaid situation shall be dealt with hereunder.

Recently, the Delhi High Court in a matter captioned as Ms. Raman Sharma vs Ms. Prem Lata Prabhakar & Ors on 30 January, 2024 CS(OS) 20/2018 has dealt with the issue and may be referred to for answer.

In Raman Sharma (Supra), the gravamen of the case is that defendant Nos. 1 & 2 had filed their amended Written Statements after 320 days, along with an Application seeking condonation of delay of 320 days in filing the amended Written Statements. The counsel for the plaintiff had given a "No Objection" to the Application and it was accordingly allowed and as such the delay of 320 days in filing the amended Written Statements was condoned and the Written Statement was taken on record.

CONTENTIONS OF PLAINTIFF AGAINST written statement

(i)          That as per the Chapter VII Rule 4 of Delhi High Court (Original Side) Rules, 2018 the Written Statement has to be filed within a period of 30 days which may be extended by the Court for another 90 days, but not thereafter. Thus, any filing beyond 120 days in a suit, is not condonable.

(ii)        That Furthermore, the plaintiff cannot be estopped from raising the ground of limitation as there is no estoppel against law. Thus, even though the plaintiff had given a no objection to the condonation of the belated filing of the Written Statement, but no concession can be made on the law, by the Court.

(iii)       That the Order VIII Rule 1 of CPC is mandatory and there cannot be any Written Statements taken on record beyond the period of 120 days. Reliance was put on (i) Ms Charu Agrawal Vs Mr Alok Kalia & Ors CS (OS)214/ 2022  decided by Co-ordinate Bench of the Delhi High Court and that of  (ii) Ram Sarup Lugani Vs Nirmal Lugani, 2020 SCC OnLine Del 1353;  (iii) Union of India Vs Popular Constructions (2001) 8 SCC 470.

(iv)       That it was reiterated that there is no estoppel against law and therefore, the concession given by the plaintiff was inconsequential. In this context reliance was placed on (i) State of Rajasthan & Anr Ve Surendra Mohnot & Ors  (2014) 14 SCC 77 and (ii) Khetro Mohan Chatterjee & Ors Vs Mohan Chandra  Das 1913 SCC OnLine Cal 34.

(v)         That Section 34(3) of Arbitration & Conciliation Act 1996  read with Chapter VII Rule 4 of the Delhi High Court (Original Side) Rules, 2018 are akin to Order VIII of CPC 1908. It provides that the Petition under Section 34 of the Arbitration and Conciliation Act, 1996 can be filed within the given time and not thereafter. The phrase and "not thereafter", in the context of Section 34 of the Arbitration and Conciliation Act, 1996 has been interpreted to mean that under no circumstances can the period be extended beyond the prescribed period.

(vi)       That limitation, being a legal issue, it can be raised even at the stage of Appeal and the Second Appeal, since it goes to the root of the matter and is a requirement of law. Reliance was placed on the decisions in State of Gujarat Vs Kothari & Associates  (2016) 14 SCC 761.

(vii)     That against a patently illegal order, the Court can exercise its inherent powers under Section 151 of CPC. Moreover, even under section 153 of CPC, the Court is empowered to amend any defect or error in any proceedings in the Suit.

CONTENTIONS OF DEFENDANTS

(i)          That the application for recalling of order whereby amended written statement was taken on record reeks of mala fide and abuse of the process of law, since, the plaintiff expressly consented to take the Written Statements on record and had even attempted to file its replication to the amended Written Statements. It is only when an objection was taken to the filing of the replication to the amended Written Statements beyond the stipulated period under the Delhi High Court (Original Side) Rules, 2018, that the plaintiff turned around and moved the present application.

(ii)        That the amended written statement was filed belatedly, in view of mediation proceedings underway for long period,  but, when no amicable resolution of disputes, could be arrived at that, hence, amended Written Statement was directed to be filed within two weeks along with the application for condonation of delay.

(iii)       That the defendants, thereafter, had filed the amended Written Statement along with the application for condonation of delay.

(iv)       That the application by the plaintiff for seeking recall of order whereby amended written statement was permitted to be taken on record was only an afterthought and is without any basis. The reliance has been placed on the decision in Union of India Vs Susaka Pvt Ltd & Ors 2018(2) SCC 182, wherein it has been observed that if a plea is available whether on facts or law, it has to be raised by the party at the appropriate stage in accordance with law; if not raised and/or given up with consent, it would be precluded from taking such plea on the principle of waiver.

(v)         That reliance was placed on Bharat Kalra Vs Raj Kishan Chhabra 2022 SCC OnLine SC 613, to buttress the point that that delay in filing of the Written Statement could be compensated with costs, but to deny the benefit of filing the Written Statement, is unreasonable. When the plaintiff had already given a no objection, hence, there cannot be any deviation from that and raising objection to the filing of the amended Written Statement is untenable.

(vi)   That in Salem Bar Association Vs Union of India 2005 (6) SCC 344, wherein it was held that the provisions including proviso to Order VIII Rule 1 of CPC permit filing the Written Statement accepted expiry of 90 days from initial 30 days and the delay beyond 120 days, can be condoned by the Court.

The issue therefore raised in this context is –

Whether a Written Statement to the amended plaint can be accepted beyond the statutory period of 30 days plus 90 days as contemplated under the Proviso to Order VIII Rule 1 read with Section 151 of the Code of Civil Procedure, 1908 and read with Delhi High Court (Original Side) Rules, 2018.

                                        AND

Whether a bar stipulated in the law of limitation can be condoned?

Before further deliberation, it is imperative to state that the law prescribes a certain thing to be done in a certain way, then it cannot be done in any other way as has been encapsulated in the Latin maxim Expressio unius est exclusion alterius.

If a person makes a statement to the contrary, to renounce the benefit of a right introduced in his own favour, the legal principle proffered in quilibet potest renunciare juri prose introducto (One can waive a right available to him in his behalf) . No doubt, this is essentially restricted to the provisions intended for the benefit of an individual and may not apply to Law enacted, based on public policy such as law of limitation, in the present case.

The Supreme Court in the case of France B Martins Vs Mafalda Maria Teresa Rodrigues (1999) 6 SCC 627 has categorically observed that the period of limitation is founded on public policy and aimed at secure the quietus of the issues raised beyond certain period and need of a quicken diligence and to prevent oppression till perpetuity.

In Union of India Vs British India Corporation Ltd (2003) 9 SCC 505 it is held that the question of limitation is a mandate to the forum and irrespective of the issue being raised, the forum must consider and apply it. Similar is the ratio in State of Gujarat Vs M/s Kothari & Associates AIR ONLINE 2015 SC 206 and that the objection to the limitation can also be raised even at the stage of second appeal, if the bar of limitation is evident.

It is thus found that the time frames defined for the purpose of limitation are absolute and do not admit to any exception. The Courts shall be bound by it and no exception can be carved out, irrespective of genuine reasons for delay. Even if a party may give a concession to the other by waiving off the limitation period, a party making such statement cannot be held bound by that, since, the principle of estoppel shall not operate against the law.

Coming back to the issue of condonation of delay in filing written statement, it is to be borne in mind that in order to curb inordinate delays in litigations, comprehensive amendments were introduced in  The Code of Civil Procedure, 2002 ,   effective w.e.f. 01.07.2002. As the bottleneck was identified for long period taken for completion of pleadings, hence, with a view to address the problem, Order VIII Rule 1  of CPC along with its Proviso, was introduced, thereby maximum time of 120 days was defined for filing of the written statement.

This mandate was further reinforced in the Delhi High Court (Original Side) Rules, 2018. Chapter VII Rule 4 of the Rules, 2018 and that provides for the extension that can be granted by courts if the Written Statement is not filed within 30 days of being served. The provision reads as under:

"4. Extension of time for filing written statement.--If the Court is satisfied that the defendant was prevented by sufficient cause for exceptional and unavoidable reasons in filing the written statement within 30 days, it may extend the time for filing the same by a further period not exceeding 90 days, but not thereafter. For such extension of time, the party in delay shall be burdened with costs as deemed appropriate. The written statement shall not be taken on record unless such costs have been paid/ deposited. In case the defendant fails to file the affidavit of admission/ denial of documents filed by the plaintiff, the documents filed by the plaintiff shall be deemed to be admitted. In case, no written statement is filed within the extended time also, the Registrar may pass orders for closing the right to file the written statement."

It is worthwhile to note that the Delhi High Court (Original Side) Rules, 2018, were enacted in exercise of the powers under Section 129 of CPC empowering the high court to make rules "not inconsistent with the Letters Patent to regulate its own procedure in the exercise of its original jurisdiction as it shall think fit. It was held by the Supreme Court in Iridium India telecom Ltd Vs Motorala Inc (2005) 2 SCC 145 while dealing comprehensively of the Charter establishing High Courts and the scope of the non-obstante clause in Section 129 and it was held that the non obstante clause in Section 129 is intended to bypass the entire body of the Code so far as the rules made by the Chartered High Court for regulating the procedure on its Original Side, are concerned.

It was inter alia held that the Rules framed by High Courts would prevail over the provisions of Code of Civil Procedure, even if the said Rules are inconsistent with the Code. It was observed as under:

"39. Taking into account the extrinsic evidence, i.e. the historical circumstances in which the precursor of Section 129 was introduced into the 1882 Code by a specific amendment made in 1895, we are of the view that the non obstante clause used in Section 129 is not merely declaratory, but indicative of Parliament's intention to prevent the application of the CPC in respect of civil proceedings on the Original Side of the High Courts."

As far as the word “but not thereafter” it has been interpreted in several judgments, for instance in Gautam Gambhir Vs Jai Ambay Traders 2020 SCC OnLine Del 2621 that the words "but not thereafter" mentioned in the Rule 4, of Chapter VII of the Delhi High Court Rules, 2018 clearly indicate that a total of 120 days granted for filing of Written Statement cannot be extended and if the same is not complied with, then the Registrar may pass orders closing the right to file the same.

In the case of Ram Sarup Lugani (Supra), the Division Bench of Delhi High Court has upheld the Delhi High Court (Original) Rules, 2018 to hold that the said Rules shall prevail over the Code of Civil Procedure. The inherent powers contemplated in Chapter I Rule 16 of the said Rules are not to be exercised over to overcome or circumvent the limitation expressly provided under Chapter VII of the Rules. The phrase "but not thereafter", though in the context of filing of a Replication, was interpreted and it was observed that the words not thereafter must clearly be accorded due weight and the timeline provided could not be extended by the Courts or take the replication on record after the time has been exhausted by the party.

The Delhi High Court in Ms. Raman Sharma (Supra) has held as under:

67. In the present case, the facts involved are different as it is not a case of filing the Written Statement in the first instance. The Suit was filed on 12.01.2018 to which the Written Statements were filed by defendant Nos. 1 & 2 filed on 07.03.2018. The Plaintiff sought amendment of the plaint which was allowed vide Order dated 18.12.2019 and the amended plaint was taken on record. The defendants were directed to file their amended Written Statement to the amended Plaint within 30 days.

71. The pertinent question which now remains to be answered is whether the stringent timeframes as prescribed under Order VIII Rule 1 of CPC for filing of the Written Statement within 30 days of service which may be extended to 120 days on showing sufficient cause, is also applicable to the amended pleadings.

72. The Scheme of Code of Civil Procedure, in regard to the amendments of the pleadings, as encapsulated in Order VI Rule 17 of Code of Civil Procedure, provides that the pleadings (which includes the plaint and the written statement) may be amended at any stage, if considered just and necessary for determining the real question in controversy between the parties. However, this provision is circumscribed by twin conditions in the Proviso which are: that the amendment shall not be allowed after the trial has commenced; and unless the Court comes to the conclusion that such matter could not have been raised before the commencement of trial, despite due diligence.

The scope of filing an amended Written Statement to an amendment allowed in a plaint had been explained by the Full Bench of Delhi High Court n the case of Kedar Nath & Ors Vs Ram Prakash & Ors  1999 (48) DRJ (FB): -

"22. To sum up, we are of the opinion that:

(i) merely because an amendment has been allowed in the plaint, the defendant does not get a right and certainly not an unbridled right to file a new written statement;

(ii) any additional pleading cannot be at variance or inconsistent with the original pleading;

(iii) a pleading inconsistent with or in departure from an original pleading can be allowed only by way of amendment subject to the leave being granted by the Court under Order 6 Rule 17 of CPC

(iv) Order 6 Rule 17 CPC applies to amendment in the plaint and the Written Statement-both. It applies to amendment sought for by one party and also to consequential amendments in the pleadings sought for by the opposite party. Any amendment - whether original or consequential, shall be only by the leave of the Court.

In Gurdial Singh & Ors Vs Raj Kumar Aneja & Ors (2002) 2 SCC 445, it has been further explained that when an application under Order VI Rule 17 of CPC is allowed, such amendments are known as consequential amendments. It is relevant to mention that the phrase "consequential amendment" finds mention in the decision of the Supreme Court in a matter reported as Bikram Singh & Ors Vs Ram Baboo & Ors AIR 1981 SC 2036. The Court may see that the plea sought to be introduced is by way of an answer to the plea previously permitted to be incorporated by way of amendment by the opposite party or not? A new plea cannot be permitted to be added in the garb of a consequential amendment.

The Delhi High Court in Ms. Raman Sharma  (Supra) has observed that in this case the issue is to file amended written statement to the amended plaint. The amendments were allowed to the Plaint, but in response thereto, instead of responding to the consequential amendments, the defendants took independent pleas in their amended Written Statement. Consequentially, the Written Statement filed to the amended Plaint was directed to be taken off the record and thereafter, the Written Statement was again sought to be filed and the same was filed after a delay of 320 days which has been condoned by the high court vide a speaking order and the Written Statement to amended Plaint were taken on record.

In para 77 of  Ms Raman Sharma (Supra) it is held as under:

“Here, in such cases, the timeframes as provided under Order VII Rule 1 of CPC would not be applicable to the Written Statement filed by defendant Nos. 1 & 2, as "consequential amendments" to an amended Plaint do not fall within the scope and purview of Order VIII Rule 1 of CPC and Order VI Rule 18 of CPC becomes applicable for determining the time frame for such amended pleadings. The provision reads as under: -

"Order VI -- Pleadings Generally .......

Rule 18: Failure to amend after order.--

If a party who has obtained an order for leave to amend does not amend accordingly within the time limited for that purpose by the order, or if no time is thereby limited then within fourteen days from the date of the order, he shall not be permitted to amend after the expiration of such limited time as aforesaid or of such fourteen days, as the case may be, unless the time is extended by the Court."

It may be noted from the aforesaid that 14 days time frame is extendable by the Court and is a discretion of Court. It is not difficult to comprehend the rationale either. Either party can seek permission to amend the Plaint or the Written Statement which is already on record and has been filed within the given timeframe. The amendments are allowed to be made at any stage before the trial but can also be considered at a later stage if they could not have been made earlier despite exercise of due diligence. Since the pleading can be amended at any stage, the time frame of 120 days as prescribed for the filing of original Written Statement becomes inapplicable to consequential amendments made to the Written Statement. This is more so as the defence of the defendant is already on record and it is only to the amendments allowed to the plaint that an additional response is required.

Thus, there is no timeframe provided for filing of the written statement/pleadings which are consequent to an amendment, and the Court may grant the time as it may deem fit in terms of Order VI Rule 18 of CPC.

                                  ------

                          Anil K Khaware

Founder & Senior Associate

Societylawandjustice.com

 

 

 

CONSUMER COMPLAINTS: PECUNIARY LIMITS OF CONSUMER COMMISSIONS

 

Consumer complaints:  Pecuniary limits OF CONSUMER COMMISSIONS

 

The Supreme Court has recently ascertained as regards valuation, what should be construed as part of valuation for preferring consumer complaints before District Consumer Commission, State Consumer Commission and National Consumer Commission as per the Consumer Protection Act 2019. The Consumer Protection Act 1986 has been completely overhauled and a new Act of 2019 is in place. The judgment rendered in RUTU MIHIR PANCHAL & ORS.VERSUS UNION OF INDIA & ORS. 2025 INSC 593 (Writ Petition Civil No. 282 of 2021) rendered in April 29^th 2025 is therefore significant. It is significant, because the competence of parliament to prescribe pecuniary limits and vires and constitutionality of Sections 34,47 and 58 of Consumer Protection Act 2019 were under challenge, besides the perceived ambiguity as regard how valuation could be arrived at in order to file the complaints before the respective pecuniary limits prescribed for respective Consumer Commissions.  

The Constitutionality of Sections 34(1), 47(1)(a)(i) and 58(1)(a)(i) of the Consumer Protection Act, 2019, prescribing pecuniary jurisdictions of the District, State and National Commissions on the basis of value of goods and services paid as consideration, instead of compensation claimed were challenged in the writ petition2 under Article 32 of the Constitution and the civil appeal3 against the order of the National Consumer Disputes Redressal Commission.

The order of National Commission was impugned before the Supreme Court. The relevant portion of the order impugned are as under:

“…The Pecuniary Jurisdiction has been specified in the Consumer Protection Act, 2019, where the consideration paid, if exceeds Rupees Ten Crores, will give power to the National Consumer Disputes Redressal Commission to entertain any Complaint. It has nothing to do with the amount of Compensation to be claimed by any of the Complainant. ”

 

A comparative chart of the jurisdictions exercised by the district, state and national commission under the repealed 1986 Act and the present 2019 Act is as follows:

 

FORUM	1986 Act	2019 Act
DISTRICT COMMISSION	Section 11.(1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed does not exceed Rupees Twenty Lakhs…	Section 34.(1) Subject to the other provisions of this Act, the District Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as claimed does not exceed rupees Twenty Lakhs… consideration does not exceed One Crore Rupees…
State Commission	Section 17. Subject to the other provisions of this Act, the State Commission shall have jurisdiction— (a) to entertain — (i) complaints where the value of the goods or services and compensation, if any, claimed exceeds Rupees Twenty Lakhs but does not exceed rupees One Crore…	Section 47. (1) Subject to the other provisions of this Act, the State Commission shall have jurisdiction — (a) to entertain — (i) complaints where the value of the goods or services paid as consideration, exceeds rupees One Crore, but does not exceed Rupees Ten Crore...
National Commission	Section 21. Subject to the other provisions of this Act, the National Commission shall have jurisdiction — (a) to entertain— (i) complaints where the value of the goods or services and compensation, if any, claimed exceeds Rupees One Crore…	Section 58. (1) Subject to the other provisions of this Act, the National Commission shall have jurisdiction — (a) to entertain — (i) complaints where the value of the goods or services paid as consideration exceeds Rupees Ten Crore…

 

The aforesaid pecuniary limits are further modified vide notification dated 30^th December 2021, whereunder the pecuniary limits of the Consumer Commissions shall be as under:

 

FORUM	2019 Act (Till November 2021)	2019 Act ( Amended new  notification)
District Commission	Value of goods and/or service does not exceed 1 Crore	Value of goods and/or service does not exceed 50 Lakhs.
State Commission	Value of goods and/or service from Rs 1 Crore , but does not exceed Rs 10 Crore	Value of goods and/or service from Rs 50 lakhs, but does not exceed Rs 2 Crore
National Commission	Value of goods and/or service above Rs 10 Crore	Value of goods and/or service above Rs 2 Crore

 

A plain reading of the provisions of 2019 Act, makes it clear, that the 2019 Act shifts the basis of the pecuniary jurisdiction of the District, State as well as National Commission from value of compensation claimed under the repealed 1986 Act to value of the consideration paid for the goods and services.

It is also recognized that classification based on value of goods or services on the basis of the amount paid as consideration is valid. “Consideration” is an integral part of forming any contract. It is also an integral part of the definition of a ‘consumer’.

The Supreme Court in Rutu Mihir (Supra) has held that there is no doubt about the fact that the Parliament has the legislative competence to enact the Consumer Protection Act, 2019. Under Entry 95 of List I read with Entries 11-A and 46 of List III6 and in exercise of power under Article 246, the Parliament has enacted the Consumer Protection Act, 2019. Thus, the legislative competence to prescribe jurisdiction and powers of a court, coupled with the power to constitute and organize courts for administration of justice, takes within its sweep the power to prescribe pecuniary limits of jurisdiction of the courts or tribunals. (Ref: In State of Bombay v. Narottamdas Jethabhai (1950) SCC 905)

Significantly, the Supreme Court has held in Rutu Mihir        Panchal (Supra) as under:

10.3 An agreement enforceable by law is a contract. In turn, every promise and every set of promises forming part of the consideration for each other, is an agreement.  And then, when, at the desire of the promisor, the promisee … has done…something, such act is called consideration. A proposal, when accepted, becomes a promise. Finally, when a person signifies to another his willingness to do anything… with a view to obtaining his assent it is a proposal. While this is the involution of formation of a contract, evolution in its making is evident when a proposal, as defined, becomes a promise and when such a promise is espoused by consideration it becomes an agreement and if that agreement is enforceable in law, it becomes a contract. Between evolution and involution, lies the essential core, the consideration, without which there is no agreement, and if there is no agreement, there is no contract.

 

10.4 It is in recognition of the first principles of formation of a contract that section 2(7) of the 2019 Act defines a consumer as any person who buys any goods or hires or avails any service for a consideration. The consideration could be in the present or future, in whole, part, or by deferred payment. Whichever be the mode, there must be a consideration. That is essential to be a consumer.

 

10.5 Therefore, vesting jurisdiction in the district, state or National Commission on the basis of value of goods or services paid as ‘consideration’, is neither illegal nor discriminatory. …..The myriad ways in which a consideration could be inferred would not derogate from the essentiality of consideration in every transaction leading to formation of a contract…”.

 

The Supreme Court in Rutu Mihir Panchal (Supra) has held that:

11.1 There is also a misconception that there is some kind of a loss of judicial remedy. No such event has occurred because of Sections 34, 47 and 58 of the 2019 Act. The relief or compensation that a consumer could claim remained unrestricted and at the same time, access to the state or the national commission is also not taken away. It is well settled that there is no right or a privilege of a consumer to raise an unlimited claim of compensation and thereby chose a forum of his choice for instituting a complaint. In Nandita Bose v. Ratanlal Nahta CC No. 833 of 2020 , this Court has held that a court or a tribunal will always have the jurisdiction to assess or reassess an overvalued or grossly undervalued claim in a petition in the following terms:

“4. …The principles which regulate the pecuniary jurisdiction of civil courts are well settled. Ordinarily, the valuation of a suit depends upon the reliefs claimed therein and the plaintiffs valuation in his plaint determines the court in which it can be presented. It is also true that the plaintiff cannot invoke the jurisdiction of a court by either grossly over-valuing or grossly under-valuing a suit. The court always has the jurisdiction to prevent the abuse of the process of law. Under Rule 10 of Order 7 of the Code the plaint can be returned at any stage of the suit for presentation to the court in which the suit should have been instituted...”

The Supreme Court has concluded in Rutu Mihir Panchal (Supra) in para 13, as under:

13. Conclusions: For the reasons stated above; (a) we dismiss the constitutional challenge to section 34, 47 and 58 of the 2019 Act and declare that the said provisions are constitutional and are neither violative of Article 14 nor manifestly arbitrary; (b) Central Consumer Protection Council and the Central Consumer Protection Authority shall in exercise of their statutory duties under sections 3, 5, 10, 18 to 22 take such measures as may be necessary for survey, review and advise the government about such measures as may be necessary for effective and efficient redressal and working of the statute.

It is therefore evident from the aforesaid illustrations that the limits determined by the parliament, thereby prescribing pecuniary limits for the complaints filed before the respective Consumer Commission falls within the domain of parliament and the value of services and goods for the purpose of ascertaining the value of complaint so as to file it, before appropriate commission have already been dealt with by the Supreme Court, in as much as for the purpose of determining the valuation, the value of goods or services or promise made shall fall within the meaning of consideration. In Rutu Mihir Panchal (Supra) para 10.4 it is further clarified that section 2(7) of the 2019 Act defines a consumer as any person who buys any goods or hires or avails any service for a consideration. The consideration could be in the present or future, in whole, part, or by deferred payment. Whichever be the mode, there must be a consideration.

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Anil K Khaware

Founder & Senior Associate

Societylawandjustice.com