Shree Champalal Kothari Trust & Ors. v. Rajhans Cooperative Housing Society Ltd.

(x) monetary claim must be based on unauthorized construction.

(xi) filing a fresh proceeding is necessary after discovery of the sanctioned plan to avoid multiple proceedings

7. The petitioners filed an affidavit opposing the application. The Cooperative Court heard both sides. It allowed the respondent to withdraw the dispute with liberty to file a fresh dispute on the same cause of action, subject to limitation.

8. The petitioners filed Appeal No.51 of 2018. The Cooperative Appellate Court dismissed the appeal on 31 January 2020. The petitioners then filed a revision application. The revision was dismissed by the impugned order. Hence, the present petition.

9. Mr. Arun Panickar, learned counsel for the petitioners submitted that the Cooperative Court failed to apply the requirement of Order 23 Rule 1(3)(a) and (b). He relied on the remand order dated 2 February 2007. He argued that the remand was restricted only to proving the four documents. The Cooperative Court could not allow withdrawal and grant liberty to file a fresh dispute because the Appellate Court had already limited the scope. According to him, the Cooperative Court exceeded the remand directions.

10. He further submitted that the dispute is pending since 1979. Allowing a fresh dispute prolongs the hardship to the petitioners. According to him, the reasons stated in the application do not constitute a formal defect. He prayed that the impugned orders be set aside.

11. Mr. Rohan Sawant, learned counsel for the respondent relying upon the judgment of the Supreme Court in V. Rajendran vs Annasamy Pandian (2017) 5 SCC 63 urged that the Supreme Court treated wrong description of the property in the plaint as a formal defect and permitted withdrawal of the suit with liberty to file a fresh one. He submitted that a formal defect relates to the form or procedure prescribed in law. It does not touch the merits of the dispute. Examples include absence of notice under Section 80, improper valuation, confusion in identifying the property, misjoinder of parties, or failure to disclose cause of action. He requested that the term formal defect be interpreted in a liberal manner.

12. He drew attention to the sanctioned building plan obtained by the respondent on 9 June 2018. According to him, the plan shows that petitioner has constructed more than 1500 sq. ft. though only 150 sq. ft. was the garage area. The society has lost the open space due to unauthorized construction.

13. He added that the issues now include encroachment and unauthorized construction. The society must file fresh proceedings seeking demolition and other reliefs. He pointed out that as on 31 March 2018, the dues payable by the petitioners were Rs. 86,44,005. He submitted that the respondent filed the withdrawal application on genuine grounds and that the Courts below rightly granted permission. He prayed for dismissal of the petition.

14. I have considered the record. I have heard the learned advocates for both sides at length. The question before this Court is narrow. Whether the Cooperative Court was justified in permitting withdrawal of the dispute with liberty to file a fresh dispute on the same cause of action under Order 23 Rule 1(3) of the Code of Civil Procedure.

15. It is not in dispute that the dispute was instituted in the year

1979. The Cooperative Court dismissed it in 2005. Thereafter, the Appellate Court examined the entire record. The Appellate Court found that four documents, which were relevant, had not been considered by the Cooperative Court. The Appellate Court therefore set aside the judgment of dismissal and sent the matter back to the Cooperative Court in the year 2007.

16. The direction of the Appellate Court was clear. The Cooperative Court was required to decide the dispute afresh only in the light of the observations made in that order. The Appellate Court permitted the parties to produce those four documents and to lead oral evidence limited to proving those documents. The remand order did not reopen the entire dispute. It did not give a free hand to either side to introduce new facts or new causes of action. The remand was confined to a narrow compass so that the dispute would be completed without unnecessary delay.

17. A remand of this nature does not wipe out earlier proceedings. It only permits the trial court to fill in the gaps identified by the appellate forum. When the Appellate Court restricts the remand, the Trial Court has a duty to remain within those limits. The Trial Court cannot assume that the entire matter stands reopened. It cannot allow new pleadings that were never part of the dispute when the Appellate Court passed the remand order. Judicial direction binds subordinate courts. Once an appellate forum has given a clear and specific direction, the subordinate court must carry out that direction as mandated.

18. The law permits remand only for the purpose for which it is made. The limited nature of the remand order makes it clear that the Appellate Court intended only a limited adjudication. It did not intend that the respondent should be permitted to enlarge the scope of the dispute by raising new issues or new claims after several decades. To do so would defeat the finality of appellate directions and would amount to opening an entirely new chapter of litigation which the appellate forum never permitted.

19. Once the Appellate Court restricted the scope of remand, the jurisdiction of the Trial Court stood confined within those limits. The Trial Court could not travel beyond the four corners of the remand order. The appellate direction operated as a mandate. It required the Trial Court to decide the dispute only on the basis of the four documents permitted to be brought on record and the limited oral evidence related to them. The remand did not permit reopening of pleadings, expansion of issues, or introduction of fresh causes of action.

20. In such a situation, the Trial Court cannot grant permission to withdraw the entire dispute with liberty to file a fresh dispute containing new grounds, new reliefs, or additional parties. Doing so amounts to undoing the remand order itself. If the Trial Court allows the respondent to broaden the dispute, it frustrates the appellate direction. It replaces the narrow enquiry envisioned by the Appellate Court with a fresh round of litigation. This would defeat the object of remand, which was only to cure a specific and limited defect.

21. Judicial discipline demands that the Trial Court must faithfully execute the directions of the appellate forum. Directions issued by a superior court are binding. A subordinate court cannot sit in appeal over them. It cannot introduce powers that the remand order did not confer. If the Trial Court allows withdrawal with liberty to file a fresh proceeding based on new pleadings and additional grounds, the result is that the earlier remand order becomes redundant. The dispute, instead of moving towards finality, is pushed back to the starting point. This is contrary to the mandate of law, which seeks early resolution and discourages endless litigation.

22. Therefore, permitting withdrawal with liberty to file a fresh dispute in such circumstances is not only beyond jurisdiction but also contrary to settled principles of finality and procedural discipline. Such an exercise cannot stand.

23. The reasons stated in the withdrawal application do not meet the test of a formal defect under Order 23 Rule 1(3) of the Code of Civil Procedure. The law draws a clear line. A formal defect must relate only to the form of the proceeding. It must be procedural in nature. It cannot touch upon the merits of the case. It cannot permit a party to rebuild the case from the ground up.

24. In the present matter, the respondent does not point out any procedural irregularity. The respondent does not say that the dispute suffered from lack of notice, improper valuation, insufficient court fee, or any similar defect. Instead, the respondent states that proper pleadings were not drafted. Reliefs for demolition were not sought. The sanctioned plan became available much later. These are not minor omissions that go to form. These are matters that go to substance.

25. If a party says that the entire plaint needs to be rewritten with new facts, new pleadings and new reliefs, it is not curing a defect. It is changing the very nature of the dispute. Law does not permit a litigant to abandon a long pending proceeding and start afresh only because the party wishes to improve its case. Order 23 Rule 1(3) is not an escape route. It exists to avoid failure of a suit due to technical defects. It does not permit a second attempt on merits.

26. Allowing withdrawal in such circumstances would permit a litigant to reopen issues closed by time and procedure. It would nullify years of earlier proceedings. Courts cannot allow this, particularly when the litigation has continued for decades. The law expects parties to come prepared with complete pleadings at the appropriate stage. After several rounds of proceedings and a restricted remand order, the respondent cannot convert the dispute into a new proceeding under the guise of a formal defect.

27. Thus, what is sought is not rectification. It is reconstruction. The law does not support such an approach.

28. Order 23 Rule 1(3) is not meant to give a fresh innings to a party who wants to improve its case after passage of several decades. The law does not permit withdrawal merely because the party now thinks it could have pleaded better or because new facts have emerged over the years. A litigant must stand by his pleadings unless the defect is of a technical nature.

29. Further, the dispute is pending since 1979. The petitioners have faced litigation for more than four decades. If withdrawal is granted with liberty to file a fresh dispute, the petitioners will once again face an entirely new round of litigation. Courts exist to resolve disputes, not to perpetuate them.

30. The reliance placed by the respondent on the judgment in V. Rajendran is misplaced. In that case, the Supreme Court found that the defect was only in the description of the property. It was therefore held to be a formal defect. Here, the respondent seeks to introduce entirely new reliefs and new issues. This cannot be treated as a formal defect.

31. When the Appellate Court limited the remand to only the proof of four documents, the Trial Court could not grant liberty to file a fresh dispute on wide grounds. The Trial Court acted outside the remand directions. The Appellate Court, while deciding the revision, failed to notice this error. Both orders therefore suffer from jurisdictional error and require interference.

32. Hence, following order:

1979, the Cooperative Court shall decide the dispute expeditiously and in any case within six months from the date of receipt of this order.

33. The Writ Petition allowed in the above terms. No order as to costs. (AMIT BORKAR, J.)