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2023 DIGILAW 510 (CAL)

Star Paper Mills Ltd. v. Eastern Coalfields Limited

2023-04-11

KRISHNA RAO

body2023
JUDGMENT : Krishna Rao, J. 1. The plaintiff has filed the instant application seeking leave to produce additional documents. 2. Ms. Sristi Burman, Learned Advocate representing the plaintiff submits that the plaintiff has instituted the suit on 16th May, 2015, prior to commencement of the Commercial Courts Act, 2015. She submits that after the enactment of the Commercial Courts Act, 2015, by the consent of both the parties, this Court has transferred the instant suit before this Court as the transaction between the plaintiff and defendant is commercial in nature. 3. Ms. Burman submits that due to pandemic Covid-19, this Court was taking only the urgent matters and as such the plaintiff could not take steps during the said period and soon after regular Court starting functioning, the plaintiff has contacted his advocate-on-record and the during discussion, the advocate-on-record came to know that some further documents which has not been disclosed along with the plaint earlier is required to be disclosed for proper and effective adjudication of the instant suit. 4. Ms. Burman submits that the concerned dealing official of the plaintiff who was acquainted with the facts of the matter and all relevant documents connected with the instant suit has left the employment of the plaintiff due to which delay was caused for filing of the instant application. She further submits that as the document is voluminous and as such the advocate-on-record took time to prepare the instant application after verification of the documents. 5. Ms. Burman submits that the documents which the plaintiff intends to disclose are very much necessary for proper adjudication of the instant suit. 6. Mr. Pradipta Bose, Learned Advocate representing the defendant submits that the application filed by the plaintiff is not maintainable under law. He submits that the plaintiff has filed the instant application in gross suppression and misrepresentation of material fact. 7. Mr. Bose submits that the documents which the plaintiff intends to produce, all the documents are of prior to filing of the suit and the plaintiff has not disclosed as to why the plaintiff has not made the said documents being the part of the plaint. 8. Mr. Bose submits that the provisions of Commercial Courts Act, 2015 would apply in the present suit and as such the plaintiff cannot be allowed to disclose further document at the later stage. 9. Mr. 8. Mr. Bose submits that the provisions of Commercial Courts Act, 2015 would apply in the present suit and as such the plaintiff cannot be allowed to disclose further document at the later stage. 9. Mr. Bose relied the provision of Order 11 Rule 3 and Rule 5 and submits that the plaintiff has filed a false declaration at the time of the filing of the suit that the plaintiff has disclosed all the documents which were in possession, control or custody of the plaintiff. 10. Mr. Bose submit that as per the Provision of Order 11 Rule 5 of the amended provisions of the Code of Civil Procedure, 1908, the plaintiff shall not be allowed to rely on the documents which were in the plaintiff’s possession and had not disclosed along with the plaint or within the extended period as provided under law. 11. Mr. Bose submits that admittedly the documents which the plaintiff intends to bring on record at the later stage were in possession of the plaintiff and the plaintiff has not disclosed the same at the time of filing of the suit and on the other hand, the plaintiff has declared that the plaintiff has disclosed all the documents. 12. Mr. Bose relied upon the following judgments : i. 2021 SCC OnLine SC 734 (Sudhir Kumar @ S. Baliyan –vs-Vinay Kumar G.B.). ii. 2022 SCC OnLine Del 3089 (Anita Chhabra & Ors. –vs-Surender Kumar). iii. Unreported judgment passed by the Delhi High Court in the case of Bela Creation Private Limtied –vs-Anuj Textiles dated 2nd May, 2022. iv. Unreported judgment passed by the Del High Court in the case of Societe Des Products Nestle S.A. & Anr. –vs-Esser Industries & Ors. dated 28th July, 2016. 13. The documents which the plaintiff intents to disclose in the suit are as follows : Sr Document Particulars 1. Steam Consumption statement from internal audit report of Chaturvedi & Co in March, 2011 (Annexure B) This illustrates the excess expenditure in consumption of coal in 2011-12 as compared to 2008-09 and 2009-10 amounting to Rs. 1,61,22,448/-. 2 Table showing Eastern Coalfield Limited’s (ECL) rake details supplied to the plaintiff in different years (Annexure C) In the year 2011, GCVGross Calorific Value (quality) of coal was much lower than the quality agreed upon. 3 Table showing cost of coal from Eastern Coalfields Limited compared to the actual market price of coal. 1,61,22,448/-. 2 Table showing Eastern Coalfield Limited’s (ECL) rake details supplied to the plaintiff in different years (Annexure C) In the year 2011, GCVGross Calorific Value (quality) of coal was much lower than the quality agreed upon. 3 Table showing cost of coal from Eastern Coalfields Limited compared to the actual market price of coal. (Annexure D) This comparative chart shows the extra expenditure incurred by the plaintiff amounting to Rs. 3,25,09,848/- 4 Comparative chart of coal supplied by ECL under Bill nos. 2702041100101 and 2702041100107 and the norms suggested by ECL. (Annexure E). This comparative chart shows a huge difference in the quality of coal supplied under the bills as mentioned as compared to the suggested Norms by the defendant itself. 5. Certificate of Inspection no. C/IGI/DLH/12- 13/C&C/34554/145235 from Inspectorate Griffith Pvt Ltd dt. 11.05.2012. (Annexure F) Analysis of coal supplied by ECL - as per ISO Standards on air dried basis – it was found GCV Kca;/kg was 5630 and total moisture % was 4.41. 6 Comparative chart demonstrating the percentage of coal brought from ECL by the plaintiff versus the percentage of coal bought from the market from 2007-15. (Annexure G) This chart shows there was a gradual increase in the quantity of coal bought from the market by the plaintiff due to inferior quality as against billed by ECL. 7. Tabular chart showing losses due to increase in machine and turbine downtime due to poor quality coal from March 2011 to June 2012. (Annexure H) This shows the actual time when the machinery was out of action or unavailable for use due to the inferior quality of coal being used as supplied by ECL. 8 Complete audit report prepared by Chaturvedi & Co (FY2011-12) (Annexure I) This report indicates the reports, observations, management replies impact and recommendations on boiler efficiency, maintenance work orders, steam consumption per ton, furnace oil consumption. 9 Year wise details of coal procurement and consumption from the market. (Annexure K) This shows that the yearly coal consumption from the market increased due to the poor quality coal being supplied by ECL. 10 Purchase Order 360027-12 dt. 04.05.2012 (Annexure K) Purchase order for Slack coal issued by plaintiff to the defendant – 3415.700 MT 11 Purchase Order 360169-09 dt. 06.10.2009, (Annexure L) Purchase order for Slack coal issued by plaintiff to the defendant – 29250 MT 12 Purchase Order 360056-11 dt. 06.06.2011. 10 Purchase Order 360027-12 dt. 04.05.2012 (Annexure K) Purchase order for Slack coal issued by plaintiff to the defendant – 3415.700 MT 11 Purchase Order 360169-09 dt. 06.10.2009, (Annexure L) Purchase order for Slack coal issued by plaintiff to the defendant – 29250 MT 12 Purchase Order 360056-11 dt. 06.06.2011. (Annexure M) Purchase order for Slack coal issued by plaintiff to the defendant – 564.480 MT 13 Bill/Invoice no. 11030412001113 dt. 07.04.2012 issued for Rs. 2,04,23,812.58/- . (Annexure N) Bill/Invoice no. 11030412001113 dt. 07.04.2012 issued for Rs. 2,04,23,812.58/- . (Annexure N) 14 Order no. 360165-14 issued by plaintiff to Osho Minerals India Private Limited. (Annexure O) Order placed by plaintiff upon Osho Minerals India Private Limited for procurement of 2000 MT imported South African Coal – as coal supplied by ECL was of inferior quality 15 Order no. 360067-15 issued by plaintiff to SBC Minerals Limited. (Annexure P). Order for supply of 3800 MT steam coal – as coal supplied by ECL was of inferior quality. 16 Test Report dated 21.03.2009 and 20.04.2012 and 19.04.2011 on coal rake sent by ECL. (Annexure Q) It was found that coal of GCV 4465, 5776 and 4549 was supplied (lowest grade) 17 Grades of Coal published by Ministry of Coal. (Annexure R) This publication indicates the grades/specifications of coal 18 New pricing list of non-coking coal based on GCV dated 31.01.2012. (Annexure S) This table is indicative of the price of non-coking coal for power utilities, fertilizer, defence sector and for sectors other than power utilities (including IPPs) 19 A comparative chart of coal supplied by ECL under Bill no. 1103041200113 dt. 13.04.2012 and the norms suggested by ECL. (Annexure T). This demonstrates the cost of Grade B Coal and quantity of coal supplied by ECL compared to the norms suggested by ECL. The GCV of rake supplied is lower than ECL norms. 20 Price Notification no. CIL S & M GM (F) pricing dated 27.05.2013. (Annexure U). This shows the prices and rates of coal from various subsidiaries. 21 Bill cum Tax Invoice No. 2702041100107 dt. 30.03.2011. (Annexure V). For a sum of Rs. 1,17,60,381/- 22 Bill cum Tax Invoice No. 2702041100101 dt. 30.03.2011. (Annexure W) For a sum of Rs. 87,00,628.67/- 23 Month wise chart of boiler efficiency during financial year 2010-11. (Annexure X). For the period of April 2011-March 2012. 24 Notice dt. 21 Bill cum Tax Invoice No. 2702041100107 dt. 30.03.2011. (Annexure V). For a sum of Rs. 1,17,60,381/- 22 Bill cum Tax Invoice No. 2702041100101 dt. 30.03.2011. (Annexure W) For a sum of Rs. 87,00,628.67/- 23 Month wise chart of boiler efficiency during financial year 2010-11. (Annexure X). For the period of April 2011-March 2012. 24 Notice dt. 27.02.2012, 25.01.2012, 16.12.2011, 26.07.2011, 21.01.2014, regarding coal allocation (Annexure Y) These notices are indicative of less availability of coal with ECL as they have allotted only 60% to 70% Coal quantity for supply. 25 News article citing various unfair trade practices by Coal India Limited and violation of competition norms. (Annexure Z) 14. On perusal of the above documents it reveals that all the documents are of the year 2011 to 2015 i.e prior to filing of the suit. The ground urged by the plaintiff for non-disclosure of the documents is that at the time of filing of the suit usual practice was not to disclose all relevant documents along with the plaint but to disclose at later stage at the time of filing affidavit of evidence. It is admitted by the plaintiff that the said procedure has changed after promulgation of the Commercial Courts Act, 2015. On 20th April, 2022, the suit was transferred to this Court. 15. It is true that Order XI, Rule 1 of the CPC is applicable to the commercial suits brought about a radical change and it mandates the plaintiff to file the list of all documents, photocopies of all documents, in its power, possession, control or custody pertaining to the suit, along with the plaint and a procedure provided under Order XI, Rule 1 is required to be followed by the plaintiff and the defendant, specially when the suit is commercial suit. Order XI Rule 1 as applicable to the commercial suits read as follows: “DISCLOSURE, DISCOVERY AND INSPECTION OF DOCUMENTS IN SUITS BEFORE THE COMMERCIAL DIVISION OF A HIGH COURT OR A COMMERCIAL COURT O.11 R.1. Order XI Rule 1 as applicable to the commercial suits read as follows: “DISCLOSURE, DISCOVERY AND INSPECTION OF DOCUMENTS IN SUITS BEFORE THE COMMERCIAL DIVISION OF A HIGH COURT OR A COMMERCIAL COURT O.11 R.1. Disclosure and discovery of documents.—(1) Plaintiff shall file a list of all documents and photocopies of all documents, in its power, possession, control or custody, pertaining to the suit, along with the plaint, including:— (a) documents referred to and relied on by the plaintiff in the plaint; (b) documents relating to any matter in question in the proceedings, in the power, possession, control or custody of the plaintiff, as on the date of filing the plaint, irrespective of whether the same is in support of or adverse to the plaintiff’s case; (c) nothing in this Rule shall apply to documents produced by plaintiffs and relevant only–– (i) for the cross-examination of the defendant’s witnesses, or (ii) in answer to any case set up by the defendant subsequent to the filing of the plaint, or (iii) handed over to a witness merely to refresh his memory. (2) The list of documents filed with the plaint shall specify whether the documents in the power, possession, control or custody of the plaintiff are originals, office copies or photocopies and the list shall also set out in brief, details of parties to each document, mode of execution, issuance or receipt and line of custody of each document. (3) The plaint shall contain a declaration on oath from the plaintiff that all documents in the power, possession, control or custody of the plaintiff, pertaining to the facts and circumstances of the proceedings initiated by him have been disclosed and copies thereof annexed with the plaint, and that the plaintiff does not have any other documents in its power, possession, control or custody. Explanation.––A declaration on oath under this sub-rule shall be contained in the Statement of Truth as set out in the Appendix. Explanation.––A declaration on oath under this sub-rule shall be contained in the Statement of Truth as set out in the Appendix. (4) In case of urgent filings, the plaintiff may seek leave to rely on additional documents, as part of the above declaration on oath and subject to grant of such leave by Court, the plaintiff shall file such additional documents in Court, within thirty days of filing the suit, along with a declaration on oath that the plaintiff has produced all documents in its power, possession, control or custody, pertaining to the facts and circumstances of the proceedings initiated by the plaintiff and that the plaintiff does not have any other documents, in its power, possession, control or custody. (5) The plaintiff shall not be allowed to rely on documents, which were in the plaintiff’s power, possession, control or custody and not disclosed along with plaint or within the extended period set out above, save and except by leave of Court and such leave shall be granted only upon the plaintiff establishing reasonable cause for non–disclosure along with the plaint. (6) The plaint shall set out details of documents, which the plaintiff believes to be in the power, possession, control or custody of the defendant and which the plaintiff wishes to rely upon and seek leave for production thereof by the said defendant. (7) The defendant shall file a list of all documents and photocopies of all documents, in its power, possession, control or custody, pertaining to the suit, along with the written statement or with its counterclaim if any, including— (a) the documents referred to and relied on by the defendant in the written statement; (b) the documents relating to any matter in question in the proceeding in the power, possession, control or custody of the defendant, irrespective of whether the same is in support of or adverse to the defendant’s defence; (c) nothing in this Rule shall apply to documents produced by the defendants and relevant only–– (i) for the cross-examination of the plaintiff’s witnesses, (ii) in answer to any case set up by the plaintiff subsequent to the filing of the plaint, or (iii) handed over to a witness merely to refresh his memory. (8) The list of documents filed with the written statement or counterclaim shall specify whether the documents, in the power, possession, control or custody of the defendant, are originals, office copies or photocopies and the list shall also set out in brief, details of parties to each document being produced by the defendant, mode of execution, issuance or receipt and line of custody of each document. (9) The written statement or counterclaim shall contain a declaration on oath made by the deponent that all documents in the power, possession, control or custody of the defendant, save and except for those set out in sub-rule (7) (c) (iii) pertaining to the facts and circumstances of the proceedings initiated by the plaintiff or in the counterclaim, have been disclosed and copies thereof annexed with the written statement or counterclaim and that the defendant does not have in its power, possession, control or custody, any other documents. (10) Save and except for sub-rule (7) (c) (iii), defendant shall not be allowed to rely on documents, which were in the defendant’s power, possession, control or custody and not disclosed along with the written statement or counterclaim, save and except by leave of Court and such leave shall be granted only upon the defendant establishing reasonable cause for non-disclosure along with the written statement or counterclaim. (11) The written statement or counterclaim shall set out details of documents in the power, possession, control or custody of the plaintiff, which the defendant wishes to rely upon and which have not been disclosed with the plaint, and call upon the plaintiff to produce the same. (12) Duty to disclose documents, which have come to the notice of a party, shall continue till disposal of the suit.” 16. Order XI Rule 1(3) provides that the plaint shall contain a declaration on oath from the plaintiff that all documents in the power, possession, control or custody of the plaintiff, pertaining to the facts and circumstances of the proceedings initiated by him have been disclosed and copies thereof annexed with the plaint, and the plaint does not have other document in its power, possession, control or custody. As per the explanation under Order XI Rule 1(3), a declaration on oath under this Sub-Rule shall be contained in the Statement of truth reads as under : “STATEMENT OF TRUTH “I_____________,s/o__________age____years______ ______,___________________________________do hereby solemnly affirm and declare as under; I am plaintiff in this suit and I am competent and authorized by plaintiff company to swear this affidavit. I am sufficiently conversant with the facts of the case and I have also examined all relevant documents and records in relation thereto. I say that the statements made in paragraph no. 1 to 13 are true to my knowledge and statements made in paragraph 14 to 16 are based on legal advice, which I believe to be true and correct. I say that there is no false statement or concealment of any material fact, document or record and I have included information that according to me, is relevant for present suit. I say that all documents in my power, possession, control or custody pertaining to the facts and circumstances of the proceedings initiated by me have been disclosed and copies thereof are annexed with the plaint, and I do not have any other documents in my power, possession, control or custody. I say that the above mentioned pleadings comprises of total of 8 pages, each of which has been duly signed by me. I state that the Annexures hereto are true copies of the documents referred to and relied upon by me. I say that I am aware that for any false statement or concealment, I shall be liable for action taken against me under the law for the time being in force. Place: __________ Date: ___________ Deponent.” 17. As per the above provision, the declaration on oath shall be part of the plaint. The plaintiff has to declare on oath that all documents in its/his power, possession, control or custody pertaining to the facts and circumstances of the proceedings initiated by him or it has been disclosed and the copies thereof annexed with the plaint, and that he does not have any other documents in his power, possession, control or custody. Therefore as such it is mandatory by Order XI, Rule 1 for the plaintiff to disclose and produce all documents in his power, possession, control or custody, pertaining to the facts and circumstances of the proceedings. 18. Therefore as such it is mandatory by Order XI, Rule 1 for the plaintiff to disclose and produce all documents in his power, possession, control or custody, pertaining to the facts and circumstances of the proceedings. 18. This Court finds that the plaintiff has not filed statement truth along with the plaint. After the transfer of the suit before this Court, the plaintiff has only amended the cause title of the plaint by incorporating the word “Commercial Division” and has not taken any further steps in compliance of the Commercial Courts Act, 2015. 19. However, additional document can be permitted to be brought on record with the leave of the Court as provided in Order XI Rule 1(4). Order XI, Rule 1(4) provides that in case of urgent filings, the plaintiff may seek leave to rely on additional documents as part of the declaration on oath (as provided under Order XI Rule 1(3) and subject to grant of such leave by Court, the plaintiff shall file such additional documents in Court, within thirty days of filing of the suit, along with a declaration on oath that the plaintiff has produced all documents in its power, possession, control or custody, pertaining to the facts and circumstances of the proceedings initiated by the plaintiff and that the plaintiff does not have any documents, in its power, possession, control or custody. 20. Order XI, Rule 1(5) further provides that the plaintiff shall not be allowed to rely on documents, which were in the plaintiff’s power, possession, control or custody and not disclosed along with plaint or within the extended period set out above, save and except by leave of Court and such leave shall be granted only upon the plaintiff establishing reasonable cause for non-disclosure along with the plaint. Therefore, on combined reading of Order XI Rule 1(4) read with Order XI Rule 1(5), it emerges that (i) in case of urgent filing, the plaintiff may seek leave to rely on additional documents, (ii) within 30 days of filing of the suit, (iii) making out a reasonable cause for non-disclosure along with plaint. 21. Therefore, on combined reading of Order XI Rule 1(4) read with Order XI Rule 1(5), it emerges that (i) in case of urgent filing, the plaintiff may seek leave to rely on additional documents, (ii) within 30 days of filing of the suit, (iii) making out a reasonable cause for non-disclosure along with plaint. 21. Therefore, further 30 days time is provided to the plaintiff to place on record or file such additional documents in Court and a declaration on oath is required to be filed by the plaintiff as required as per Order XI Rule 1(3), if or any reasonable cause for non-disclosure along with the plaint, the documents, which were in the plaintiff’s power, possession, control or custody is not disclosed along with the plaint. Therefore, the plaintiff has to satisfy and establishes cause for non-disclosure along with plaint. However, at the same time, the requirement of establishing the reasonable cause for nondisclosure of the documents along with the plaint shall not be applicable if it’s award and it is the case of the plaintiff that those documents have been found subsequently and in fact were not in the plaintiffs power, possession, control or custody at the time when the plaint was filed. Therefore, Order XI Rule (4) and Order XI Rule 1(5) applicable to the commercial suit shall be applicable only with respect of the documents which were in the plaintiff’s power, possession, control or custody is not disclosed along with the plaint. Therefore, the rigour of establishing the reasonable cause is non-disclosure along with the plaint may not arise in the case where the documents sought to be produced/ relied upon are discovered subsequent to file of the plaint. 22. The present suit was transferred to this Court on 20th April, 2022 but the plaintiff has not taken any steps for leave to disclose documents as per the provisions of Commercial Courts Act within thirty days. It is also found from record that the plaintiff has not filed statement of truth along with the plaint after transfer of the suit. 23. The plaintiff has now filed the instant application in the month of January, 2023 seeking leave to produce additional documents. Admittedly, the documents were in possession of the plaintiff and had not disclosed the same along with the plaint being voluminous. 23. The plaintiff has now filed the instant application in the month of January, 2023 seeking leave to produce additional documents. Admittedly, the documents were in possession of the plaintiff and had not disclosed the same along with the plaint being voluminous. Assuming when the plaintiff had filed the suit at the relevant point of time, there was no mandatory provision for filing of the documents along with plaint but subsequently the suit was transferred before this Court and by that time the amended provision were in force and the plaintiff has amended the plaint by incorporating the word Commercial Division but had not taken any further steps in compliance of the Commercial Courts Act, 2015 including by filing the statement of truth. 24. The suit was transferred to the commercial division by an order dated 20th April, 2022 and the plaintiff had carried out amendment by incorporating the word Commercial Division on 24th April, 2022 and has not taken any further steps in compliance of the Commercial Courts Act, 2015 and had filed the instant application in the month of January, 2023 i.e. about 9 months after from the date of transfer of the suit to this Court. 25. In view of the above, I am of the opinion that the plaintiff has not shown any reasonable cause for non-disclosure of the documents along with plaint and the plaintiff has also not availed the benefit when the suit was transferred to this Court. Accordingly, the application filed by the plaintiff being G.A. 3 of 2023 for disclosure of additional documents is thus dismissed.