Anupma Rubber Pvt. Ltd. and Another vs Bata India Limited and Another

T.H.B. Chalapathi, J.—This revision petition is filed against the order of the learned Additional Civil Judge (Senior Division), Palwal, dated

June 6, 1998.

The plaintiff filed the suit for recovery of damages against the defendant and also for declaration and injunction. According to the plaintiff, it

entered into an arrangement with the first defendant to manufacture Hawai Chappals for the plaintiff, as per its specifications, standards and quality

out of the raw materials supplied by the plaintiff to the first defendant and certain machinery and equipment were also supplied by the plaintiff to the

first defendant for the purpose of carrying out the work. Some machinery supplied by the plaintiff was returned while the other machinery was

retained by the first defendant. The first defendant also executed a power of attorney in favour of the second defendant-Bank, authorising the

second defendant to receive the payment from the plaintiff of the amount due to the first defendant from the plaintiff. During June 1989, the second

defendant made a demand of Rs. 20,83,027.44 paise from the plaintiff on the ground that the said sum was due. On verification, the plaintiff found

that it did not receive 12 bills of an amount of Rs. 5,63,440.80 Paise and no goods had been received by the plaintiff from the first defendant in

respect of those 12 bills, which were submitted by the second defendant for payment. When the director of the first defendant was confronted with

the said position, he admitted in his letter dated 29.6.1989 that those 12 aforesaid invoices were forged and no Hawai Chappals had been

supplied and the first defendant also requested the second defendant not to recover any amount from the plaintiff under those bills. In view of these

facts, the plaintiff lost confidence in the first defendant and ac- cordingly terminated all transactions with the first defendant and demanded the first

defendant to return the machinery and equipment belonging to the plaintiff but the first defendant neglected to return the machinery and is now using

the same for its own purpose. While so, the second defendant demanded the plain- tiff to pay Rs. 20,83,027.44 paise. Besides, the first defendant

also supplied defec- tive Hawai Chappals and the first defendant has to reimburse the plaintiff for the same. The plaintiff, therefore, filed the suit for

recovery of the machinery and the equipment which were supplied by the plaintiff to the first defendant and also for the recovery of Rs.

24,43,197.24 Paise with future interest.

The suit was filed on 14.6.1990.

The defendants filed a written statement on 16.8.1990 admitting the receipt of machinery and equipment but denied its liability either to return

the machinery and equipment and also to make the payment of the suit amount.

On the basis of the pleadings, appropriate issues have been framed and the plaintiff has also closed his evidence on 19.4.1997 and the matter

was com- ing for the evidence of the defendants. While so, the first defendant made an application on 30.4.1998 for amendment of the written

statement under Order 6 Rule 17 of the CPC to permit him to take the plea that the first defendant supplied goods to the plaintiff worth Rs. 23.65

lacs during the period October 1988 to April 1989 and that the plaintiff-Company has to pay Rs. 5,34,394.26 Paise to the first defendant and that

the second defendant filed a suit for recovery of the said amount against the first defendant and that the first defendant is entitled to adjust the said

claim of the plaintiff-Company out of price of the abovesaid goods supplied by the first defendant to the plaintiff Company. It is further averred that

the first defendant has a running account with the plaintiff and, therefore, it is entitled to adjust any outstandings of the plaintiff-Company against its

own outstanding.

The said application for amendment of the written statement was opposed by the plaintiff on the ground that the said application was moved

only to delay the proceedings and it also denied its liability and it is further pleaded that it is in the nature of the counter claim which is barred by

time. The said application for the amendment of the written statement has been dismissed by the trial Court in the impugned order. Therefore, the

defendant has filed this revision petition.

There is no dispute of the fact that the suit was filed in the year 1990. The application seeking amendment of the written statement by making a

claim against the plaintiff was made only in 1998 i.e. after 8 years of the filing of the suit, According to the learned counsel for the petitioner it is in

the nature of set off. Therefore, it cannot be said that it is barred by time. Whereas, it is the case of the first defendant that it is in the nature of

counter-claim and, therefore, the same is not barred by time.

Since the application for amendment is filed after 8 years, by which time the claim of the first defendant for recovery of any amount was barred

by time, I am of the opinion that irrespective of the fact whether the claim is in the nature of set-off or counter-claim, the amendment of the written

statement cannot be allowed at a highly belated stage. Order 8 Rule 6 of the C.P.C. deals with set-off, which reads as follows:-

Order 8 Rule 6 :-

(1) Where in a suit for the recovery of money the defendant claims to set-off against the plaintiffs demand any ascertained sum of money legally

recoverable by him from the plaintiff, not exceeding the pecuniary limits of the jurisdiction of the Court, and both parties fill the same character as

they fill in the plaintiffs suit, the defendant may, at the first hearing of the suit, but not afterwards unless permitted by the Court, present a written

statement containing the particulars of the debt sought to be set-of.

(2) Effect of set-off:- The written statement shall have the same effect as a plaint in a cross-suit so as to enable the Court to pronounce a final

judgment in respect both of the original claim and of the set-off: but this shall not affect the lien, upon the amount decreed, of any pleader in respect

of the costs payable to him under the decree.

(3) The rules relating to a written statement by a defendant apply to a written statement in answering to a claim of set-off.

The particulars of set-off should be given in the written statement and the defendant may claim set-off at the first hearing of the suit but not

afterwards unless the Court permits him to make a set-off but at the time when the set-off is made the amount claimed to be set-off must be legally

recoverable. Therefore, it follows that if the defendant''s claim is barred by law of limitation, it cannot be pleaded by way of set-off under this Rule.

When the application for amendment is made, the claim of the defendant is barred by time. Therefore, the Court can-'' not permit the defendant to

make a claim of a barred debt by way of set-off

The claim of the defendant cannot be said to be a set-off. The claim of the defendant by way of an application for amendment of the written

statement is on the basis of that he supplied goods to the plaintiff and on account of the same, the plaintiff became liable to pay certain amount to

the defendant. So, it is in the nature of counter-claim in which case Rule 6-A of Order 8 of the C.P.C. applies. A counter-claim has to be treated

and has to be tried as a cross suit. Therefore, the claim of the defendant made in the year 1998 for the amounts which are said to be due to the

defendant from the plaintiff during the period 1988-89 are clearly barred by time when the application for amendment of the written statement was

made. Therefore, the claim sought to be taken by way of amendment of the written statement is barred by time on the date when the application

for amendment was filed. Therefore, the amount which is claimed by the defendant by way of amendment in the written statement is not legally

recoverable from the plaintiff since the claim is barred by time. The suit has been pending for the last 8 years. The defendant has not taken any

steps during this period of 8 years to make any claim as set-off or a counter-claim.

In these circumstances, I do not find any grounds to permit the defendant to amend the written statement at this belated stage. I am, therefore,

of the opinion that the trial Court rightly refused to allow the amendment of the written statement. The revision petition is, therefore, dismissed.