SUIT No. 1861 OF 2002

11th March 2020

Petitioner Counsel: Mr. Yahya Ghoghari Uttam S. Rane Jatin Sheth
Respondent Counsel: Mr. A.S. Khandeparkar Mr. P.A. Sarwankar Sarwankar & Co.
Act Name: Code of Civil Procedure, 1908 Limitation Act, 1963 Constitution of India, 1950

Section :
Section 9A Code of Civil Procedure, 1908 Section 151 Code of Civil Procedure, 1908 Section 3 Limitation Act, 1963 Section 27 Limitation Act, 1963

Cases Cited :
Paras 5, 12: Nusli Neville Wadia Vs. Ivory Properties & Ors., 2019 SCC ONLine SC 1313
Para 10: Ramesh B. Desai Vs. Bipin Vadilal Mehta & Ors., 2006(6) ALL MR 56 (S.C.) : (2006) 5 SCC 638

JUDGEMENT

1. Before dealing with the arguments that were canvassed before me, I would have to mention that originally Notice of Motion 4507 of 2006 was filed by Defendant Nos. 1 and 2 for striking off the plaint under Order VI Rule 16 read with Section 151 of the Code of Civil Procedure (for short “the CPC”) and under Article 215 of the Constitution of India. Defendant Nos. 1 and 2 also sought an order rejecting the plaint as being barred by limitation and for dismissing the Suit as being not maintainable. This Notice of Motion was heard by a learned Single Judge of this Court (Shri S.J. Vazifdar, J) and by order dated 26th February, 2008, after a detailed discussion, the learned Single Judge dismissed the said Notice of Motion. This order of the learned Single Judge dated 26th February, 2008 was subjected to an appeal being Appeal No. 509 of 2008. The Appeal Court passed the following order by consent of parties:-
(i) The learned trial Judge may try the issue of limitation and jurisdiction first as provided for under Order XIV Rule 2 of the C.P.C. The suit may be decided, as expeditiously as possible. No other interference is called for with the order in the appeal; (ii) Appeal is disposed of in the above terms.
(iii) The learned counsel for the respondents states that the respondents will file an affidavit of evidence within a period of two weeks from 17.4.2009. (emphasis supplied)

2. After the order of the Appeal Court, another learned Single Judge of this Court (Shri R.Y. Ganoo, J) by order dated 30th November, 2010 inter alia framed the following issues under Order XIV Rule 2 of the CPC:-
(i) Does Defendant No.1 prove that this Court has no jurisdiction to try and entertain this Suit?
(ii) Does Defendant No.1 prove that the Suit is barred by the period of limitation?

3. The learned Judge further observed that looking to the aforesaid issues, defendant Nos. 1 and 2 stated that they will have to lead evidence. In view of the aforesaid statement, the matter was set down for recording of evidence on 13th January, 2011 on which date Defendant No.1 was directed to file his evidence affidavit as well as compilation of documents limited to the aforesaid issues. Pursuant to this order, it has been brought to my notice that evidence has been led on the aforesaid issues by the Plaintiffs as well as Defendant No.1 and the evidence is complete.

4. Mr. Khandeparkar, the learned Advocate appearing on behalf of Defendant Nos. 1 and 2 therefore submitted that considering the past orders and the fact that the evidence is now complete, the Court may hear and decide the preliminary issues framed by this Court vide its order dated 30th November, 2010.

5. On the other hand, Mr. Ghoghari, the learned Counsel appearing on behalf of the Plaintiffs, submitted that in view of a recent decision of the Supreme Court in the case of Nusli Neville Wadia vs. Ivory Properties & Ors, [2019 SCC ONLine SC 1313], an issue that required evidence cannot be heard as a preliminary issue but would have to be decided with all other issues in the suit. He therefore submitted that it would in the interest of all parties if all the issues are decided together so that there is no further delay in the suit going to trial.

6. I have heard the learned Counsel for the parties at some length and have perused the papers and proceedings in the present suit.

7. The order passed by the Division Bench in Appeal dated 23rd March, 2009 inter alia recorded that the learned Judge may try the issue of limitation and jurisdiction first as provided for under Order XIV Rule 2 of the C.P.C. It further directed that the suit be decided as expeditiously as possible. No other interference was called for with the order under appeal, was the finding of the Division Bench.

8. Order XIV Rule 1 of the C.P.C. deals with framing of issues. Order XIV Rule 2 contemplates that the Court is to pronounce judgment on all issues and reads thus:-
“2. Court to pronounce judgment on all issues----
(1) Notwithstanding that a case may be disposed of on a preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues.
(2) Where issues both of law and of fact arise in the same suit, and the Court is of opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to---
(a) the jurisdiction of the Court, or
(b) a bar to the suit created by any law for the time being in force, and for that purpose may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with the decision on that issue.” (emphasis supplied)

9. From the aforesaid Rule, it is clear from sub-rule (1) that notwithstanding that a case may be disposed of on a preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues. An exception is carved out under sub-rule (2) which stipulates that where issues both of law and of fact arise in the same suit, and the Court is of the opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first, if that issue relates to (a) jurisdiction of the Court; or (b) a bar to the suit created by any law for the time being in force. For this purpose, the Court may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with the decision on that issue.

10. On a plain reading of Order XIV Rule 2 and more particularly sub-rule (2) thereof, it is clear that the Court has the power to decide the question of jurisdiction or a bar to a suit created by any law for the time being in force, only on an issue of law. The aforesaid provision confers no jurisdiction on the Court to decide a mixed question of fact and law, unless the facts are clear from the plaint itself and the mixed question of fact and law can be determined on the principle of demurrer. This, in fact, has been so held by the Supreme Court in the case of Ramesh B. Desai vs. Bipin Vadilal Mehta & Ors, [(2006) 5 SCC 638]. The relevant portion of this decision reads thus:-
“13. Sub-rule (2) of Order 14 Rule 2 CPC lays down that where issues both of law and of fact arise in the same suit, and the court is of the opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to (a) the jurisdiction of the court, or (b) a bar to the suit created by any law for the time being in force. The provisions of this Rule came up for consideration before this Court in Major S.S. Khanna v. Brig. F.J. Dillon, [(1964) 4 SCR 409 : AIR 1964 SC 497] and it was held as under: (SCR p. 421)
“Under Order 14 Rule 2, Code of Civil Procedure where issues both of law and of fact arise in the same suit, and the court is of opinion that the case or any part thereof may be disposed of on the issues of law only, it shall try those issues first, and for that purpose may, if it thinks fit, postpone the settlement of the issues of fact until after the issues of law have been determined. The jurisdiction to try issues of law apart from the issues of fact may be exercised only where in the opinion of the court the whole suit may be disposed of on the issues of law alone, but the Code confers no jurisdiction upon the court to try a suit on mixed issues of law and fact as preliminary issues. Normally all the issues in a suit should be tried by the court; not to do so, especially when the decision on issues even of law depend upon the decision of issues of fact, would result in a lopsided trial of the suit.” Though there has been a slight amendment in the language of Order 14 Rule 2 CPC by the amending Act, 1976 but the principle enunciated in the above quoted decision still holds good and there can be no departure from the principle that the Code confers no jurisdiction upon the court to try a suit on mixed issues of law and fact as a preliminary issue and where the decision on issue of law depends upon decision of fact, it cannot be tried as a preliminary issue.” (emphasis supplied)

11. In the present case, admittedly, the issues framed by the learned Judge involve mixed questions of fact and law. This, in fact, is conceded by the parties themselves in view of the fact that both the parties have sought to lead evidence on the aforesaid issues. This being the case, I do not think that Mr. Khandeparkar is right in contending that these issues have to be decided first and until they are decided the other issues ought to be postponed. If the argument of Mr. Khandeparkar is accepted, it would run directly contrary to the provisions of Order XIV Rule 2 reproduced above. Even sub-rule (2) of Rule 2 of Order XIV gives a discretion to the Court to decide a particular issue as a preliminary issue only on a point of law provided the same relates to (a) jurisdiction of the Court; or (b) a bar to the suit created by any law for the time being in force. This is clear from the use of the words “it may try that issue first”. In a given case, even if a preliminary issue regarding jurisdiction or a bar to a suit can be decided on a point of law, the Court always has the discretion not to decide the said issue as a preliminary issue but decide it along with all other issues in the suit. This being the position from the clear and unambiguous language of Order XIV Rule 2, I think that the insistence of Mr. Khandeparkar to hear the aforesaid two issues as preliminary issues is misconceived.

12. I must also mention that in a recent decision of the Supreme Court in the case of Nusli Neville Wadia (supra), the Hon’ble Supreme Court also took a similar view in relation to Section 9A of the C.P.C. (in so far as it relates to the State of Maharashtra). Paragraph Nos. 59, 60 and 61, and which are relevant for our purpose, read thus:-
“59. When we consider what colour expression “jurisdiction” has in Section 9A, it is clearly in the context of power to entertain, jurisdiction takes colour from accompanying word ‘entertain’; i.e. the Court should have jurisdiction to receive a case for consideration or to try it. In case there is no jurisdiction, court has no competence to give the relief, but if it has, it cannot give such relief for the reason that claim is time-barred by limitation or is barred by the principle of res judicata or by bar created under any other law for the time being in force. When a case is barred by res judicata or limitation, it is not that the Court has no power to entertain it, but it is not possible to grant the relief. Due to expiry of limitation to file a suit, extinguishment of right to property is provided under Section 27 of the Limitation Act. When Court dismisses a suit on the ground of limitation, right to property is lost, to hold so the court must have jurisdiction to entertain it. The Court is enjoined with a duty under Section 3 of the Limitation Act to take into consideration the bar of limitation by itself. The expression “bar to file a suit under any other law for the time being in force” includes the one created by the Limitation Act. It cannot be said to be included in the expression “jurisdiction to entertain” suit used in Section 9A. The Court has to receive a case for consideration and entertain it, to look into the facts constituting limitation or bar created by any other law to give relief, it has to decide the question on merits; then it has the power to dismiss the same on the ground of limitation or such other bar created by any other law. Thus, the meaning to be given to jurisdiction to entertain in Section 9A is a narrow one as to maintainability, the competence of the court to receive the suit for adjudication is only covered under the provisions. The word entertain cannot be said to be the inability to grant relief on merits, but same relates to receiving a suit to initiate the very process for granting relief.
60. The provision has been carved out under Section 9A, CPC to decide, question of jurisdiction to entertain, at the stage of deciding the interim application for injunction and the very purpose of enactment of the same was that the suits were being instituted without serving a notice under Section 80, which at the time of initial incorporation of provisions could not have been instituted without serving a notice of two months. There was a bar to institute a suit. It became practice that after obtaining injunction, suit was allowed to be withdrawn with liberty to file fresh suit after serving the notice. To take care of misuse of the provisions, Section 9A was introduced in the year 1970 and had been re-introduced again in 1977 to consider question of jurisdiction to entertain at the stage of granting injunction or setting aside. The provision has been inserted having the narrow meaning as at the stage of granting ex parte injunction; the question can be considered. The written statement, set-off and counterclaim are not filed, discovery, inspection, admission, production and summoning of the documents stage has not reached and after the stages described above, framing of issues takes place under Order XIV. As per Order XIV Rule 1, issues arise when a material proposition of fact or law is affirmed by the one party and denied by the other. The issues are framed on the material proposition, denied by another party. There are issues of facts and issues of law. In case specific facts are admitted, and if the question of law arises which is dependent upon the outcome of admitted facts, it is open to the Court to pronounce the judgment based on admitted facts and the preliminary question of law under the provisions of Order XIV Rule 2. In Order XIV Rule 2(1), the Court may decide the case on a preliminary issue. It has to pronounce the judgment on all issues. Order XIV Rule 2(2) makes a departure and Court may decide the question of law as to jurisdiction of the Court or a bar created to the suit by any law for the time being in force, such as under the Limitation Act.
61. In a case question of limitation can be decided based on admitted facts, it can be decided as a preliminary issue under Order XIV Rule 2(2)(b). Once facts are disputed about limitation, the determination of the question of limitation also cannot be made under Order XIV Rule 2(2) as a preliminary issue or any other such issue of law which requires examination of the disputed facts. In case of dispute as to facts, is necessary to be determined to give a finding on a question of law. Such question cannot be decided as a preliminary issue. In a case, the question of jurisdiction also depends upon the proof of facts which are disputed. It cannot be decided as a preliminary issue if the facts are disputed and the question of law is dependent upon the outcome of the investigation of facts, such question of law cannot be decided as a preliminary issue, is settled proposition of law either before the amendment of CPC and post amendment in the year 1976.” (emphasis supplied)

13. In fact, in Paragraph 61, the Hon’ble Supreme Court held that in a case where a question of limitation can be decided based on admitted facts, it can be decided as a preliminary issue under Order XIV Rule 2 (2) (b). However, once facts are disputed about limitation, the determination of the question of limitation also cannot be made under Order XIV Rule 2(2) as a preliminary issue or any other such issue of law which requires examination of disputed facts. This being the position, I do not think that the issues as framed under Order XIV Rule 2 by the order dated 30th November, 2010 can be decided as preliminary issues.

14. Faced with this situation, Mr. Khandeparkar submitted that on the issue of jurisdiction and limitation he would be able to demonstrate on the admitted facts and documents that the suit ought to be dismissed. I am afraid, I am unable to accept this argument for two reasons. Firstly, both the parties have led substantial evidence on both the aforesaid issues. From this, it is quite clear that there are serious disputed questions of fact that arise for deciding the aforesaid issues. In fact, in the order dated 30th November, 2010 (when the aforesaid issues were framed), a statement was recorded on behalf of Defendant Nos. 1 and 2 themselves that they would want to lead evidence in relation to these two issues. I am therefore unable to allow Mr. Khandeparkar to now contend that there are no disputed questions of fact and that he would be able to demonstrate that the suit ought to be dismissed on admitted facts. This ship has long sailed. Secondly, even otherwise, as mentioned earlier, whether a particular issue under Order XIV Rule 2 is to be decided as a preliminary issue or whether the same ought to be decided with all other issues, is entirely at the discretion of the Court. Under Order XIV Rule 2 no party can insist that the issue of jurisdiction or limitation ought to be tried as a preliminary issue. That would depend on the facts of each case and the discretion exercised by the Court in that regard. Therefore, even this submission of Mr. Khandeparkar, namely, that issue of jurisdiction and limitation should be decided as a preliminary issue as he would be able to demonstrate that this Court has no jurisdiction and/or the same is barred by the law of limitation on the admitted facts, is wholly misconceived and is of no assistance to Defendant Nos. 1 and 2.

15. For all the aforesaid reasons, I direct that the issues of jurisdiction and limitation as already framed by the order dated 30th November, 2010 shall be tried along with all other issues in the present suit.

16. It has been brought to my attention that the other issues in the present suit have not yet been framed.

17. In these circumstances, at the request of Mr. Khandeparkar, place this matter on 17th March, 2020 on the supplementary board for framing of further issues.

Decision : Ordered accordingly.