The relevant provision in regard to above is prescribed under Order 2 Rule 2 of the Code of Civil Procedure, 1908, which provides that if different reliefs and claims arise out of the same cause of action then the Plaintiff must place all his claims before the Court in one suit and cannot omit one of the reliefs or claims except without the leave of the Court.
In effect the provision bars a Plaintiff from omitting one part of claim and raising the same in a subsequent suit. In other words, the grounds or cause of action on which the first suit was filed if forms the foundation of the subsequent suit wherein the reliefs claimed could have been claimed in the former suit and also the suits are between the same parties, the subsequent suit shall attract the bar provided under the above provision.
The opposite party or Defendant must specifically plead the above position in the suit and there should be a specific issue framed by the Court to examine the pleading of the former suit, thereby giving Plaintiff an opportunity to demonstrate that the cause of action in the subsequent suit is different.
In order to examine the position, it is necessary that both the plaints are read as a whole to identify the cause of action and once the same are found to be identical and also that the relief claimed in the subsequent suit could have been pleaded in the former suit, the subsequent suit shall be barred as per Order 2 Rule 2.
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 5527
OF 2014
(Arising out of SLP (C) No.26157 of 2012)
Coffee Board
versus
M/S. Ramesh Exports Pvt. Ltd
Dated;09.05.2014
Pinaki Chandra Ghose, J.
1. Leave granted.
2. This appeal is preferred against the judgment and order dated
December 19, 2011 passed by the High Court of Karnataka at
Bangalore in Regular First Appeal No.1033 of 2005 partly
allowing the appeal filed by the respondent herein and partly
decreeing the Original Suit being O.S. No. 4763 of 1986 filed by
the respondent being the original plaintiff. The said original suit
was dismissed by a judgment and decree dated March 17,
2005.
3. Pre-liberalization, till 1996 all the coffee grown in India was
pooled with the appellant-Board which is a statutory body
under the Coffee Act, 1942. The appellant-Board (hereinafter
referred to as “Board”) marketed the pooled coffee and
distributed the net realization to the growers in proportion the
quantity pooled by them. The Board marketed the pooled
coffee by means of auctions and separate auctions were held
for export and domestic market. Only registered exporters are
allowed to participate in the said auctions and the successful
bidders amongst them enter into contracts with the Board for
the purchase of the coffee. The Board is a member of the
International Coffee Organization (hereinafter referred to as
“ICO”) which is the main intergovernmental organization
controlling and regulating the global coffee export and import.
Majority of the coffee growing and consuming countries are
members of the ICO. The import and export of coffee is
regulated by ICO by fixing quotas on the member countries in
accordance with the quantum produced. As per the then
International Coffee Agreement of 1983 the export quota
system was supported by an obligatory system of controls.
Each export by a Member was covered by a Certificate of
Origin. Importing Members did not admit coffee from Members
unless the Certificate was validated by coffee export stamps
issued by the Organization.
When quotas were in effect
importing Members were required to limit their imports from
non-members and exports to non-members were closely
monitored.
4. Accordingly, India being a member of ICO through the Board
was subject to the same agreement and as per the fixed quota
for exporting coffee the Board received stamps from ICO for
each quarter through State Bank of India. Thus, the Board
subject to ICO rules and regulations regulated the coffee
production and marketing in India by accordingly distributing
stamps to the exporters who had successfully purchased coffee
from the auctions. The respondent M/s. Ramesh Exports Pvt.
Ltd. being the original plaintiff was registered with the Board as
an exporter during the coffee year October 1, 1981 to
September 30, 1982.
5. In this backdrop, the facts leading to the present appeal are as
under:
5.1. On August 24, 1980, the appellant Board sent the ‘Terms
and Conditions of Sale of Coffee in the Course of Export’, after
amendment of certain clauses, to all the registered exporters
of coffee. On October 9, 1980 the appellant Board issued a
Circular regarding introduction of Coffee Export stamp system
for export of coffee to member importing countries of ICO from
November 1, 1980.
The respondent purchased coffee at the
export auction. The respondent shipped 230.4 tonnes of coffee
to USA and Germany who were members of ICO, on 1 st, 2nd and
3rd September, 1982 without valid ICO certificate of origin. On
September 22, 1982, the respondent wrote to the appellant
Board requesting for ICO stamps for export of 230.4 tonnes of
coffee and on September 29, 1982, the respondent wrote to
the appellant Board for issue of necessary permit/authority to
re-import 230.4 tonnes of coffee into India. The appellant
Board issued a show cause notice to the respondent alleging
that the respondent has committed breach of terms of ICO
Agreement by making false statement. The respondent replied
to the show cause notice. Thereafter, the respondent filed two
suits against the appellant Board in the Court of City Civil
Judge, Bangalore, one being O.S. No.3150 of 1985 praying for
a decree of Rs.5,32,012.31 p. with interest at the rate of 19%
per annum and costs of the suit and another suit being O.S.
No. 4763 of 1986 praying for a decree of Rs.11,70,446.39 p.
with interest at the rate of 19% per annum and costs of the
suit. The appellant Board resisted the suits and denied the
claims made by the respondent.
5.2. By judgment dated February 14, 2002, the Trial Court
decreed O.S. No.3150 of 1985 with costs and interest at 6%
per annum. Aggrieved by the judgment and decree dated
February 14, 2002 passed by the Trial Court, the appellant
Board filed R.F.A. No.901 of 2002 before the High Court of
Karnataka. However, the other suit being O.S. No. 4763 of
1986 was dismissed by the Trial Court by judgment dated
March 17, 2005 and aggrieved thereby, the respondent filed
R.F.A. No.1033 of 2005 before the High Court of Karnataka.
After considering the submissions of both the parties, the High
Court partly allowed the regular first appeals. Aggrieved by the
judgment and order dated December 19, 2011 passed by the
High Court of Karnataka at Bangalore in Regular First Appeal
No.1033 of 2005, the appellant Board has come up before this
Court.
6. The case of the appellant before us is based on two grounds.
Firstly, it has been contended by the learned counsel appearing
for the appellant that the High Court has incorrectly held that
the Original Suit being O.S. No.4763 of 1986 is not barred by
the provisions of Rule 2 of Order 2 of the Code of Civil
Procedure, 1908 (hereinafter referred to as “the Code”). In
support of the same, it has been submitted by the learned
counsel that the High Court incorrectly determined the above
without considering the specific pleadings in O.S. No.3150 of
1985 filed by the respondent, as against the pleadings in the
original suit being O.S. No.4763 of 1986. It was further
submitted that the High Court also did not consider the cogent
findings of the judgment dated March 17, 2005 passed by the
Trial Court in O.S. No.4763 of 1986.
7. The second ground raised by the learned counsel for the
appellant is on merits wherein it has been contended that when
the respondent by letter dated September 29, 1982 agreed to
re-import 230.4 tonnes of coffee into India which was exported
without ICO Stamps by them in haste and against the ICO
Regulations of which they were aware and which entailed in the
debarring of India from the membership of ICO, then they are
estopped from claiming any damages and costs being freight
and other charges arising due to the re-import.
8. Having
heard
the
arguments
advanced
by
the
counsel
appearing for the parties and considering the documents on
record in light of the averments of the parties, we will first
consider the procedural validity of the original suit and would
accordingly proceed with the merits.
9. It is the claim of the appellant being the original defendant in
the original suit being O.S. No.4763 of 1986 that the present
suit is barred by Order 2 Rule 2 of the Code. The said provision
should be read in context of Rule 1 of Order 2. The relevant
rules are reproduced below for ready reference:
“1. Frame of suit.—Every suit shall as far as
practicable be framed so as to afford ground for final
decision upon the subjects in dispute and to prevent
further litigation concerning them.
2. Suit to include the whole claim.—(1) Every suit
shall include the whole of the claim which the plaintiff is
entitled to make in respect of the cause of action; but a
plaintiff may relinquish any portion of his claim in order
to bring the suit within the jurisdiction of any court.
(2) Relinquishment of part of claim.—Where a plaintiff
omits to sue in respect of, or intentionally relinquishes,
any portion of his claim, he shall not afterwards sue in
respect of the portion so omitted or relinquished.
(3) Omission to sue for one of several reliefs.—A person
entitled to more than one relief in respect of the same
cause of action may sue for all or any of such reliefs;
but if he omits, except with the leave of the court, to
sue for all such reliefs, he shall not afterwards sue for
any relief so omitted.”
10.
The above rules are offshoots of the ancient principle that
there should be an end to litigation traced in the Full Bench
decision of the Court in Lachmi vs. Bhulli1 and approved by this
Court in many of its decisions. The principle which emerges
from the above is that no one ought to be vexed twice for the
same cause. In light of the above, from a plain reading of Order
2 Rule 2, it emerges that if different reliefs and claims arise out
of the same cause of action then the plaintiff must place all his
1
ILR (1927) 8 Lah 384
claims before the Court in one suit and cannot omit one of the
reliefs or claims except without the leave of the Court. Order 2
Rule 2 bars a plaintiff from omitting one part of claim and
raising the same in a subsequent suit. (See: Deva Ram & Anr.
vs. Ishwar Chand & Anr.2). Furthermore, this Court in
Alka
Gupta v. Narender Kumar Gupta3 stated that:
“The object of Order 2 Rule 2 of the Code is twofold.
First is to ensure that no defendant is sued and vexed
twice in regard to the same cause of action. Second is
to prevent a plaintiff from splitting of claims and
remedies based on the same cause of action. The effect
of Order 2 Rule 2 of the Code is to bar a plaintiff who
had earlier claimed certain remedies in regard to a
cause of action, from filing a second suit in regard to
other reliefs based on the same cause of action. It does
not however bar a second suit based on a different and
distinct cause of action.”
11.
The bar of Order 2 Rule 2 comes into operation where the
cause of action on which the previous suit was filed, forms the
foundation of the subsequent suit; and when the plaintiff could
have claimed the relief sought in the subsequent suit, in the
earlier suit; and both the suits are between the same parties.
Furthermore, the bar under Order 2 Rule 2 must be specifically
2
3
(1995) 6 SCC 733
(2010) 10 SCC 141
pleaded by the defendant in the suit and the Trial Court should
specifically frame a specific issue in that regard wherein the
pleading in the earlier suit must be examined and the plaintiff
is given an opportunity to demonstrate that the cause of action
in the subsequent suit is different. This was held by this Court
in Alka Gupta v. Narender Kumar Gupta (supra) which referred
to decision of this Court in Gurbux Singh vs. Bhooralal4 wherein
it was held that:
“6. In order that a plea of a bar under Order 2 Rule
2(3) of the Civil Procedure Code should succeed the
defendant who raises the plea must make out: (1) that
the second suit was in respect of the same cause of
action as that on which the previous suit was based; (2)
that in respect of that cause of action the plaintiff was
entitled to more than one relief; (3) that being thus
entitled to more than one relief the plaintiff, without
leave obtained from the court omitted to sue for the
relief for which the second suit had been filed. From
this analysis it would be seen that the defendant would
have to establish primarily and to start with, the precise
cause of action upon which the previous suit was filed,
for unless there is identity between the cause of action
on which the earlier suit was filed and that on which the
claim in the later suit is based there would be no scope
for the application of the bar.”
12.
The Courts in order to determine whether a suit is barred
by Order 2 Rule 2 must examine the cause of action pleaded by
4
AIR 1964 SC 1810
the plaintiff in his plaints filed in the relevant suits (See: S.
Nazeer Ahmed v. State Bank of Mysore & Ors. 5). Considering
the technicality of the plea of Order 2 Rule 2, both the plaints
must be read as a whole to identify the cause of action, which
is necessary to establish a claim or necessary for the plaintiff to
prove if traversed. Therefore, after identifying the cause of
action if it is found that the cause of action pleaded in both the
suits is identical and the relief claimed in the subsequent suit
could have been pleaded in the earlier suit, then the
subsequent suit is barred by Order 2 Rule 2.
13.
In the present case we have found the first suit is claimed
to be O.S. No. 3150 of 1985 and the subsequent suit is claimed
to be O.S. No.4763 of 1986. The first suit was filed by Ramesh
Enterprises which is admitted to be the Coffee Division of
Ramesh Exports Pvt. Ltd. which is the plaintiff in the second
suit. It has also been admitted by the plaintiff in the second suit
that Ramesh Exports Pvt. Ltd. is a wholly owned subsidiary of
Ramesh Enterprises Pvt. Ltd. Both the entities are operated out
of the same premises and suits were filed by their Director who
5
(2007) 11 SCC 75
is Mr. T. Thangapalam. Therefore, we are of the opinion that de
facto the parties are the same in both the suits. Having
perused the written statement of the defendant being the
appellant before us in O.S. No.4763 of 1986 we have found that
the defendant in paragraph 14(c) of his written statement has
specifically pleaded that:
“The suit is barred under Order 2, Rule 2 of the CPC as
the plaintiff having filed O.S. No. 3150/1985 in respect
of the alleged failure of the board to supply stamps for
the coffees purchased by it between 11-8-1982 and 8-
9-1982, the claim now made must be deemed to have
been relinquished.”
The Trial Court also in its judgment dated March 17, 2005
specifically framed the following issue:
“(5) Whether Defendant prove that this is barred as per
para 14 (c) of the Written Statement?”
14.
It is evident from the above that the two requirements for
the operation of bar under Order 2 Rule 2 are met with and
what remains to be seen is whether the cause of action in the
subsequent suit is the same and the relief claimed therein
could have been claimed in the earlier suit. For the same, both
the plaints are discussed in the subsequent paragraphs.
15.
In the plaint in O.S. No. 3150 of 1985 being the earlier
suit, it has been claimed by the respondent being the plaintiff
therein that the appellant being the defendants failed to supply
ICO Stamps for 268.08 tonnes of coffee purchased by him for
export between August 11, 1982 and September 8, 1982,
inspite of its assurances leading to delay in the shipment of the
coffee resulting in losses to the plaintiff. On the basis of the
same, the respondent claimed for the losses suffered by him
along with damages. The respondent further averred that the
cause of action for the suit arose on various dates when the
respondent purchased coffee from the appellant in the auctions
held by them on the assurance that the ICO Stamps will be
supplied by the appellant to them.
16.
The cause of action in the above suit is the failure of ICO
to supply stamps to the respondent inspite of its assurances.
The respondent to ensure the success of his claim, was
required to prove that on account of the omission of the
appellant i.e. failure to provide ICO Stamps for the coffee
purchased by them, the respondent suffered losses.
17.
Inspite of the different wording of the plaint in O.S. No.
4763 of 1986, being the subsequent suit, the respondent has
primarily claimed that inspite of the assurance given by the
appellant regarding the ICO stamps by its Circular dated
August 18, 1982, the appellant failed to provide the requisite
ICO Stamps for 230.4 tonnes coffee purchased by it between
July 25, 1982 and August 18, 1982. That on the basis of the
assurance of the appellant the respondent started making
preparations for the shipment and after requesting for the ICO
Stamps on August 28, 1982 and waiting for the same, he was
forced for shipment of the coffee without the necessary stamps
which lead to the recalling of the ship. That the respondent had
to bear to and fro freight charges and other costs being the
damages to importers for delay in shipment as the shipment
was called back wrongfully; on account of the omission of the
appellant for which the respondent is not accountable; and the
appellant is liable for the cost arising from the recall of the
shipment. Furthermore, as per the plaintiff, the cause of action
arose when the circular assuring the availability of stamps was
issued, when the coffee was shipped and subsequently called
back.
18.
Though the plaint in the subsequent suit is more specific,
we however, find that the respondent so as to recover the cost
of the freight charges and other costs suffered by it, must
prove that the appellant was under a duty to provide ICO
stamps; and its failure to provide the stamps timely lead to the
coffee being shipped without the stamps and ultimately lead to
the losses being suffered by the respondent.
19.
In both the suits the fact required to be proved by the
respondent (being the plaintiff therein), to succeed in its claims
was that on account of the failure of the appellant (being the
defendant) to provide the required ICO stamps as assured by it,
the respondent had to suffer losses. The two separate reliefs
claimed by the respondent are dependent on the same fact
being the omission of duty by the appellant. The grounds of
disparity in the suits are the amount of coffee and the dates
when the same was purchased, however it must be noted that
the period between August 11, 1982 and August 18, 1982 is
common to both the suits and there are no specific pleadings
differentiating the same.
Furthermore, the suits were filed
within a span of nine days of each other.
20.
In the light of the above, we are of the opinion that suits
should have been merged with the claims against coffee
purchased between July 25, 1982 and September 8, 1982, (a
period arising from the merging of the two periods claimed in
the suits wherein eight days overlapped each other) clubbed
together in the same suit from which two reliefs, first being the
losses due to delayed shipment and second being the costs
and losses arising due to the recall of the shipment, could have
been claimed.
21.
In the present factual matrix both the reliefs are being
claimed separately in the two concerned suits. This scenario
negates the principle of Order 2, Rule 2 in absence of any
explanation as to why the respondent failed to claim the relief
by way of a single suit when the cause of action was the same
in the both. Therefore, we are of the opinion that the Trial Court
Page 16
17
in its judgment dated March 17, 2005 correctly held that in
light of O.S. No. 3150 of 1985 the present suit is barred under
Order 2 Rule 2 of the Code.
22.
In view of the aforesaid discussion, we find that the High
Court has misappreciated the facts in the light of Order 2 Rule
2 of the Code and thereby the reasoning of the High Court
cannot be sustained in the eye of law. The said suit
(O.S.No.4763 of 1986) is barred. Considering the facts, as
discussed above, we set aside the judgment and order of the
High Court and uphold the order of the Trial Court. Accordingly,
the present appeal is allowed and the suit of the respondent is
dismissed.
...................................................J.
(Chandramauli Kumar Prasad)
...................................................J.
(Pinaki Chandra
Ghose)
New Delhi;
May 9, 2014.
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