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2022 DIGILAW 420 (GAU)

B. Fouress Private Limited v. State of A. P.

2022-04-25

ROBIN PHUKAN

body2022
JUDGMENT : ROBIN PHUKAN, J. 1. Correctness or otherwise of the order dated 20.12.2021, passed by the learned Civil Judge (Senior Division), Yupia, in Money Suit No. 95/2019, is put to challenge in this petition under Section 115 CPC, read with Article 227 of the Constitution of India. It is to be noted here that vide impugned order dated 20.12.2021, the learned Civil Judge (Senior Division), Yupia, has dismissed the petition filed by the petitioner under Order VII Rule 11(a) and 11(d) read with Order II Rule 2 and Section 11 of the Code of Civil Procedure, 1908, seeking rejection of the Money Suit No. 95/2019, as barred by applicable law. 2. The factual background, leading to filing of the present petition, is briefly stated as below: “The petitioner, namely B. Fouress Private Limited and the respondent, State of Arunachal Pradesh, Department of Hydro Power Development, Itanagar, entered into an agreement on 29.10.1993, in respect of Kush Mini-Hydel Project. The respondent in discharge of the aforesaid contractual obligation has paid some amount of money as consideration on 13.01.1994, 01.08.1994 and 25.08.1994. In course of execution of the said project, some dispute arose between the parties, and accordingly, the matter was referred to an Arbitral Tribunal and the Tribunal adjudicated the disputes vide Arbitral Award dated 15.02.2006, wherein, all claims and counterclaims have been adjudicated. Thereafter, the respondent instituted Money Suit being No. 95/2019, for recovery of sum of Rs. 8,98,67,000/- (Rupees Eight Crore Ninety-Eight Lakhs Sixty-Seven Thousand) only, which was paid towards the supply of Electro and Mechanical (here in after E&M) Equipment, which was included in the commissioning and constructing the Kush Mini-Hydel Project. Thereafter, the petitioner filed an Application under Order VII Rule 11(a) and 11(d) read with Order II Rule 2 and Section 11 of the Code of Civil Procedure, 1908, seeking rejection of the Money Suit No. 95/2019. But, the learned Court below, after hearing the parties, at length, dismissed the petition vide impugned order dated 20.12.2021, by holding that from the reading of the plaint, there is nothing to suggest that the same is barred by the principles of res-judicata and that admittedly, the issue of refund of cost of the E&M equipments had not been raised, heard and finally decided by the Arbitral Tribunal. It is further held that the issue of res-judicata cannot be decided merely by looking into the averment in the plaint while the pleading in Arbitral Tribunal has not been produced before the court.” 3. Being highly aggrieved, the petitioners approach this Court by filing the present petition on the following grounds: (i) That, the Money Suit No. 95/2019, has been filed in respect of sum of Rs. 8,98,67,000/- (Rupees Eight Crore Ninety-Eight Lakhs Sixty-Seven Thousand) only, which had allegedly been paid to the petitioner being consideration for commissioning the Kush Hydroelectric Power Project, under a contract dated 29.10.1993. (ii) That, the respondent had allegedly paid the amounts on 13.01.1994, 01.08.1994 and 25.08.1994, which admittedly, cause of action, arose on said dates. (iii) That, the claim made by the respondent in the Money Suit No. 95/2021, regarding the petitioner’s liability to reimburse the sum amount of Rs. 8,98,67,000/- (Rupees Eight Crore Ninety-Eight Lakhs Sixty-Seven Thousand), was the subject matter of Arbitral Award dated 15.02.2006, passed by the Arbitral Tribunal. (iv) That, in the arbitral proceedings before the Tribunal, the petitioner and the respondent had raised their claims and counterclaims with regard to the Kush Mini-Hydel Project, which admittedly forms the subject matter of Money Suit No. 95/2019. (v) That, in the said proceedings, the parties expressly joined issues on the supplies, made by the petitioner to the respondent and payment made by the respondent to the petitioner for E&M equipment relating to the Kush Mini-Hydel Project. (vi) That, the plaintiff and the defendant were agreed that the E&M equipment to be supplied for the Kush Mini-Hydel Project had been procured and stored by the defendant at Lilabari in Assam. (vii) That, the Tribunal after, considering the various claims and counterclaims, expressly found that the petitioner had not been correct in procuring the E&M equipment well in advance, and as such, adjustment of money receipts against such E&M equipment was not justified. (viii) That, the issue regarding taking back and refund of monies for, the E&M equipment stored at Lalbari had been adjudicated by the Tribunal. (ix) That, the Tribunal decline to direct refund of the sums received by the petitioner for E&M equipment in respect of the Kush Mini-Hydel Project, since no claim had been made by the respondent in that regard before the Tribunal. (ix) That, the Tribunal decline to direct refund of the sums received by the petitioner for E&M equipment in respect of the Kush Mini-Hydel Project, since no claim had been made by the respondent in that regard before the Tribunal. (x) That, the rights and liabilities of the parties in relation to the Kush Mini-Hydel Project and the agreement dated 29.10.1993, were fully and finally adjudicated, vide the Arbitral Award dated 15.02.2006 and the Tribunal refused to grant any directions for refund/repayment of money paid towards E&M equipment for Kush Mini-Hydel Project, as no claim was put forth in that regard by the respondent. (xi) That, it is manifest that the relief sought by way of Money Suit No. 95/2019, is identical to the relief that the Tribunal refused to grant in the Arbitral Award dated 15.02.2006. (xii) That, the respondent is barred from seeking said relief, at this stage, under Order II, Rule 2, of the Code of Civil Procedure, 1908, which provides that every suit must include the whole of the claim, the plaintiff therein is entitled to make with respect to a particular cause of action. Evidently, the cause of action in respect of which the arbitral proceedings were instituted, and the cause of action forming basis of Money Suit No. 95/2019, are identical and so the respondent not having made any claims regarding the sums paid for E&M equipment before the Tribunal, is deemed to have relinquished the same, and cannot agitate them, at this stage before a Civil Court. (xiii) That, the respondent is also barred from seeking relief by Section 11 of the Code of Civil Procedure, 1908, which deems any matter which might and ought to have been made ground for defense or attack in a former suit to have been a matter directly and substantially in issue in subsequent suit. (xiv) That, the respondent is barred from raising such claims in Money Suit No. 95/2019, as per the principles of constructive res-judicata, as the relief sought with respect to the E&M equipment ‘might and ought’ to have been sought during the arbitral proceedings and therefore, it is contended to allow the petition by setting aside the impugned order passed by the learned Court below. 4. I have heard Mr. D. Panging, learned counsel for the petitioner. Also heard Mr. K. Ete, learned In-Charge Advocate General representing the State respondent. 5. Mr. 4. I have heard Mr. D. Panging, learned counsel for the petitioner. Also heard Mr. K. Ete, learned In-Charge Advocate General representing the State respondent. 5. Mr. D. Panging, learned counsel for the petitioner submits that the issue raised in the Money Suit No. 95/2019, has already been adjudicated by the Arbitral Tribunal in its award dated 03.11.2002, and as such the claims made in the Money Suit is barred by the principles of res-judicata. Mr. Panging, also referred one Case Law of State of Haryana vs. State of Punjab and Another, (2004) 12 SCC 673 to contend that when the Money Suit is expressly barred by the principle of res-judicata, then the Court is required to reject the claim in terms of Order 23 Rule 6 (b). Mr. Panging, therefore, submits that the impugned order suffers from manifest illegality and therefore, contended to set aside the same by allowing the petition. 6. On the other hand Mr. Ete, learned In-Charge Advocate General, submits that the Arbitral Tribunal has not decided the issue of returning the amount spent in purchasing E&M equipment by the petitioner, as there was no claim. Mr. Ete, also drawn attention of this Court to Page No. 138 of the Arbitral Tribunal Award, to support his version, wherein, the Arbitral Tribunal has observed that: “In fact, in this context we would like to observe that, we would have been inclined to direct the claimant to take back the E&M equipment and return the monies advanced because admittedly the stage for bringing E&M Equipment have not arisen. It is also a matter of record that the respondent had expressly requested the claimant not to get the equipment until the commencement of the Civil Work. However, our hands are tied because no such claim/issue has been raised by the respondent. We, therefore, have no hesitation in holding that the Claimant was in breach of its contractual obligation for leaving the Kush Project in a state of flux. In view thereof, no claim was raised by the claimant can survive in a contract where the claimant is in breach.” 7. Mr. Ete, learned In-Charge Additional Advocate General, further submits that the Arbitral Tribunal has neither decided the issue and nor adjudicated the claim, as no claim was made to that effect. Therefore, Mr. In view thereof, no claim was raised by the claimant can survive in a contract where the claimant is in breach.” 7. Mr. Ete, learned In-Charge Additional Advocate General, further submits that the Arbitral Tribunal has neither decided the issue and nor adjudicated the claim, as no claim was made to that effect. Therefore, Mr. Ete submits that the learned Court below has rightly rejected the petition filed by the petitioner and contended to affirm the said order. Drawing the attention of this Court to a decision of Hon’ble Supreme Court in the case of Srihari Hanumandas Totala vs. Hemant Vithal Kamat and Others, (2021) 9 SCC 99 , Mr. Ete, learned In- Charge Advocate General submits that the plea of res-judicata is not tenable at all and as such the learned Court below rightly rejected the petition. 8. Having heard the submission of learned Advocate of both sides, I have carefully gone through the petition and the documents placed on record and also the impugned order, passed by the learned Civil Judge (Senior Division), Yupia, dated 20.12.2021, and I find substance in the submission of Mr. Ete, learned In-Charge Additional Advocate General representing the State respondent. The law, regarding the rejection of plaint, is well settled by Hon’ble Supreme Court in the case of Srihari Hanumandas Totala vs. Hemant Vithal Kamat and Others (Supra). In the said case, in paragraph No. 25, it has summarised the grounds for rejection of plaint, while deciding an application under Order 7 Rule 11 (d) as under: “25.1. To reject a plaint on the ground that the suit is barred by any law, only the averment in the plaint will have to be referred to. 25.2. The defence made by the defendant in the suit must not be considered while deciding the merits of the application. 25.3. To determine whether a suit is barred by res-judicata, it is necessary that (i) the “previous suit” is decided, (ii) the issues in the subsequent suit were directly and substantially in issue in the former suit; (iii) the former suit was between the same parties or parties through whom they claim, litigating under the same title and (iv) that these issues were adjudicated and finally decided by a Court competent to try the subsequent suit. 25.4. 25.4. Since an adjudication of the plea or res-judicata requires consideration of the pleadings, issues and decision in the “previous suit” such a plea will be beyond the scope of Order 7 Rule 11(d), where only the statement in the plaint will have to be perused.” 9. Having carefully gone through the plaint and the Arbitral Tribunal Award dated 15.02.2006 and also the interim award dated 03.11.2002, I find that no such claim for recovery of the money spent by the petitioner for purchasing E&M equipment has been made by the respondent before the Arbitral Tribunal. The Arbitral Tribunal Award dated 15.02.2006, reveals that the respondent had expressly requested the petitioner not to get the equipment purchased until commencement of the civil work, and the Tribunal had expressed its helplessness to issue any direction to the petitioner to take back the E&M equipment and returned the advanced monies. But, no such claim has been raised by the respondent. Since no such claim has been made by the respondent before the Arbitral Tribunal, the question of deciding issue by the Arbitral Tribunal as claim by the petitioner herein this petition appears to be totally unfounded. 10. While impugned order of the learned court below is examined in the light of the facts and circumstance discussed herein above, and also in the light of case law referred by Mr. Ete, upon which the learned Court below also relied upon, this Court left unimpressed by the submission made by Mr. D. Panging, learned counsel for the petitioner, and I find that the case law State of Haryana (supra) referred by him would not come into his aid, as the issue was never raised before the Arbitral Tribunal. 11. In the result, I find that the impugned order dated 20.12.2021, passed by the learned Civil Judge (Senior Division), Yupia, by rejecting the petition filed by the petitioner for rejection of the plaint, suffers from no illegality or material irregularity as mentioned in section 115 of the Code of Civil procedure, so as to invoke the jurisdiction vested in this court by Article 227 of the Constitution of India. 12. In the result, I find no merit in this case and accordingly, the petition stands dismissed. The parties have to bear their own costs.