Full Text
HIGH COURT OF DELHI
Date of Decision: 14.11.2024
YAJUR COMMODITIES LTD. .....Plaintiff
Through: Mr. Kamal Mehta and Mr. Nishant Mankoo, Advocates.
Through: Mr. Ritesh Kumar Choudhary, Mr. Soumik Ghosh and Mr. Akash K.
Singh, Advocates.
JUDGMENT
Review Pet. 16/2024
1. By way of present petition, petitioner (defendant) is seeking review of the judgment dated 08.12.2023 whereby two applications came to be decided. The first being petitioner’s application under Order 7 Rule 11 of CPC for dismissal of the suit as time barred, which was dismissed. The second application being respondent’s (plaintiff’s) application under Section 14 of the Limitation Act, which was allowed.
2. Petitioner has sought review of both the decisions on the ground that the court overlooked certain documents and written submissions filed by the defendant, which led the court to reach erroneous decisions on the said two applications. As far as petitioner’s application under Order 7 Rule 11 of CPC for dismissal of the suit as time barred is concerned, the petitioner has contended that the court erred in relying upon the decision in Manoj Kumar Goyal V Jagdish Prasad Modi, reported as 2014 (3) ILR (Del) 1595 which lays down an incorrect proposition of law on acknowledgment of liability under Section 18 of the Limitation Act. Petitioner has argued that Manoj Kumar Goyal (Supra) incorrectly postulates that the extension of limitation period in the cases of acknowledgment of liability under Section 18 of the Limitation Act commences from the expiration of time promised to make payment in the written acknowledgment and not from the date of acknowledgement. Petitioner has submitted that it had submitted written submissions relying upon various prior judgments, wherein the courts have held that the extension of time will be counted from the date of acknowledgment and not from the expiration of time promised to make payment in the acknowledgement. According to the petitioner, this Court should have followed the earlier judgments and by following the later judgement, the court has ignored the rules of precedents, which lead to an incorrect decision.
3. This being the only ground for seeking review, it must be said that the petitioner has wrongly premised the review on the said ground. It must be clarified that this Court only concurred with the view laid down in Manoj Kumar Goyal (Supra) which was rendered by a court of equal bench strength and decided the application thereof. It will be incorrect to say that the court followed an incorrect precedent.
4. The question that emerges for consideration is whether the view formed by this court, which concurred with view taken in Manoj Kumar Goyal, (Supra) regarding Section 18 of the Limitation Act, has ignored any binding precedent due to which there is an error apparent on the face of the order of the kind that could be rectified in the review jurisdiction.
5. Petitioner has cited five judgments on the proposition, to argue that the question of law having been settled in the judgments passed by various High Courts prior to Manoj Kumar Goyal, this court could not have taken a contrary view. On a careful perusal, except one, none of the other judgments cited by the petitioner have been delivered by this Court, much less being of a higher bench strength, to act as a binding precedent for this court. In Valliamma Champaka Pillai v. Sivathanu Pillai, reported as (1979) 4 SCC 429, the Supreme Court held that the judgement of one High Court could, at best have a persuasive effect on another High Court and would not bind it in any manner. The relevant part is extracted hereunder:-
6. The Bombay High Court in Commissioner of Income-Tax v. Thana Electricity Supply Ltd., reported as 1993 SCC OnLine Bom 591 explained the hierarchy of binding precedents in the following manner:-
territories in relation to which it exercises jurisdiction. It does not extend beyond its territorial jurisdiction.
(c) The position in regard to the binding nature of the decisions of a High
(i) A single judge of a High Court is bound by the decision of another single judge or a Division Bench of the same High Court. It would be judicial impropriety to ignore that decision. Judicial comity demands that a binding decision to which his attention had been drawn should neither be ignored nor overlooked. If he does not find himself in agreement with the same, the proper procedure is to refer the binding decision and direct the papers to be placed before the Chief Justice to enable him to constitute a larger Bench to examine the question (see Food Corporation of India v. Yadav Engineer and Contractor, (1982) 2 SCC 499: AIR 1982 SC 1302).
(ii) A Division Bench of a High Court should follow the decision of another Division Bench of equal strength or a Full Bench of the same High Court. If one Division Bench differs from another Division Bench of the same High Court, it should refer the case to a larger Bench.
(iii) Where there are conflicting decisions of courts of co-ordinate jurisdiction, the later decision is to be preferred if reached after full consideration of the earlier decisions.
(d) The decision of one High Court is neither binding precedent for another High Court nor for courts or Tribunals outside its own territorial jurisdiction. It is well-settled that the decision of a High Court will have the force of binding precedent only in the State or territories on which the court has jurisdiction. In other States or outside the territorial jurisdiction of that High Court it may, at best, have only persuasive effect. By no amount of stretching of the doctrine of stare decisis, can judgments of one High Court be given the status of a binding precedent so far as other High Courts or Courts or Tribunals within their territorial jurisdiction are concerned. Any such attempt will go counter to the very doctrine of stare decisis and also the various decisions of the Supreme Court which have interpreted the scope and ambit thereof. The fact that there is only one decision of any one High Court on a particular point or that a number of different High Courts have taken identical views in that regard is not at all relevant for that purpose. Whatever may be the conclusion, the decisions cannot have the force of binding precedent on other High Courts or on any subordinate courts or Tribunals within their jurisdiction. That status is reserved only for the decisions of the Supreme Court which are binding on all courts in the country by virtue of article 141 of the Constitution.”
7. Thus, it is settled position that a judgment delivered by the Apex Court or one delivered by a Bench of higher strength of the same High Court, acts as a binding precedent and not from another High Court. So, the premise of the review petition itself is flawed, which will render the application without merit and liable to be dismissed.
8. Be that as it may, this Court proceeds to examine the ratio laid down in the judgments cited by the petitioner to see if they are closer to the facts of the present case to derive any persuasive value from them.
9. In Kunjilal Ramgopal v. Dwarka Prasad, reported as 1945 ILR ALL 35, which is a judgment rendered by a Single Judge Bench of Allahabad High Court, the court has held that under Section 18 of the Limitation Act, fresh period of limitation period should be counted from the date of acknowledgement and not the from the date when the time to make payment committed in the acknowledgment expires. The court also observed that an acknowledgment may become a fresh contract between the parties, in which case, the limitation shall commence from the expiry of time promised to make payment however, no such case was pleaded on the facts of the case. Kunjilal Ramgopal (Supra) is a judgment passed by a single judge of Allahabad High Court and cannot be said to be a binding precedent for Delhi High Court for the Petitioner to premise its review petition on.
10. In Sheobachan Pandey & anr v. Madho Saran Choubey & anr, reported as AIR (39) Patna 73, a decision rendered by a Division Bench of Patna High Court-the ratio laid down was that an acknowledgement made under Section 18 of the Limitation Act, after the expiry of period of limitation cannot revive a time barred claim. However, the headnote may have inaccurately described the ratio of the judgment. For this reason, too, this judgment cannot be said to have laid down ratio that the petitioner is canvassing.
11. In Raj Kishore Sahay & Ors v. Binod Kumar & Ors, reported as AIR 1989 PATNA 111 which is a judgment delivered by a Single Judge Bench of Patna High Court, the acknowledgement in question did not include the offer by the acknowledger to pay the debt within a certain time. The acknowledgement was a simpliciter acknowledgement of liability and the court had no occasion to comment on the effect on the limitation period extension if there was an offer to pay at a certain time in future. The observation that the limitation period will commence from the date of acknowledgment must be seen in this context. Clearly, this judgment too cannot be said to have dealt with the issue in question specifically.
12. Rashtriya Mahila Kosh v. Society for Rural Development and another reported as AIR 2013 (Note of Cases) 155 (Del) was delivered by a Single Judge of this High Court. No doubt the court observed that under Section 18 of the Limitation Act, the period of limitation would commence from the date of acknowledgment, however, the court was not exactly called upon to decide if between the two dates i.e., the date of acknowledgment under Section 18 of the Limitation Act and the date of expiration to the time indicated for making the payment in the acknowledgment, which of the two dates would the limitation period commence from. For this reason, the ruling is not exactly on the issue at hand.
13. Only in Kovuru Kalappa Devara v. Kumar Krishna Mitter and another, reported as AIR (32) 1945 Madras 10, a judgment delivered by a Division Bench of the Madras High Court in relation to Section 19 of the Limitation Act 1908, which is equivalent to Section 18 of the Limitation Act 1963, the fifth authority cited by the petitioner and closest to the issue at hand, the acknowledgement was coupled with a commitment to pay by a certain time. The court, disagreeing with a previous judgment passed in relation to the law of Limitation applicable in England, held that limitation period shall be freshly counted from the date of acknowledgement and not from the expiration of the time promised for making payment in the acknowledgement. However, being from a different High Court, the said judgment does not act as a binding precedent on this Court which would render the order-in-review infirm.
14. As discussed above, the judgments cited by the petitioner do not support the case for reviewing the order. Another aspect, which has been ignored by the petitioner is the email exchange that took place between the parties on 01.10.2013. Petitioner is treating the email dated 01.10.2013 sent by the respondent as an acknowledgement under Section 18 of the Limitation Act. In this email, respondent stated that it was facing a financial difficulty and requested the petitioner to wait for 3-4 months for clearing the outstanding dues. This email was replied to by the petitioner via an email written on the same day i.e. 01.10.203, wherein apparently it agreed with the request of the respondent for making payments in 3-4 months however requested the respondent to start paying at the rate of Rs 1-2 Lacs per day. This email exchange clearly establishes a fresh contract between the parties wherein the request for extension of time by 3-4 months for making payment was replied to and accepted by the petitioner. This fresh contract would give rise to a fresh cause to sue upon the expiration of time granted to the respondent for making payment, for the purposes calculating limitation. The petitioner’s partial reliance on its email dated 01.10.2013 without referring to the respondent’s response dated 01.10.2013 is not correct.
15. For the reasons stated above, there is no compelling ground to review the order passed in the petitioner’s application under Order 7 Rule 11 of CPC. The request for review is therefore declined.
16. In so far as the review request in relation to the order passed in application under Section 14 of Limitation Act is concerned, it is argued by the petitioner that the court has wrongly observed that the petitioner did not produce any material to show that the petitioner was wanting in exhibiting diligence in pursuing the suit in Bombay. Petitioner has referred to part order sheet from the suit instituted in Bombay High Court to contend that the said order sheet clearly establishes that the respondent was not diligent, which contradicts the observation of the court that no material was produced to show lack of diligence on the respondent’s part. On this ground for review, the petitioner wrongly assumed that the court overlooked the order sheet. Court’s observation that no material was produced to show the lack of diligence on the part of the respondent was due to the fact that in none of the order sheets there is any observation by the court that the respondent had been delaying the proceedings or its conduct was doubtful. The order sheet does not reveal any omission on the part of the respondent in complying with the directions passed by the court from time to time.
17. The Court has returned findings based on the material produced. No material has been ignored. There is no ground for review made out on this count as well.
18. The last ground for review pressed by the petitioner is court’s alleged omission to notice the exclusive jurisdiction clause in the sale invoice. It is argued by the petitioner that the court has wrongly concluded that there was no indication that the courts at Delhi would have exclusive jurisdiction. It is submitted that since the sale invoice clearly used the expression “only” in the context of jurisdiction of courts at Delhi, there was no element of uncertainty about the place of jurisdiction. In this context it is noted that even though sale invoice mentions that courts at Delhi “alone” shall have jurisdiction, but the High Sea Sale Agreement was executed at Mumbai, which persuaded the respondent to institute the suit in Bombay High Court based on the place of accrual of cause of action. This court has already observed in the order-in-review that the question of territorial jurisdiction often becomes a debatable proposition between the parties for the court to deny benefit of Section 14 of the Limitation Act to a party which choses to approach a court based on its own interpretation of the jurisdiction clause.
19. In this case there is definitely a wrong choice of forum exercised by the respondent. It is not disputed that the agreement in question was executed in Mumbai. Under the circumstances, it could be a matter of legal dilemma for a party to choose a place for filing the suit based on two different events i.e. place of signing of the agreement versus the place mentioned as a place of exclusive jurisdiction in the sale invoice.
20. Section 14 does not countenance that the court deciding the application has to determine the jurisdictional court. The court has to decide if the filing of the suit before the wrong court was bonafide or not. Section 14 presupposes that the original filing was done in a wrong court and give benefit of an error of judgment on the part of the applicant, in excluding the time spent before a wrong court.
21. This court feels compelled to reiterate the oft forgotten fundamentalreview is not a substitute for appeal.
22. For the reasons stated above, the review petition is dismissed.
JUDGE NOVEMBER 14, 2024