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PETITIONER: KONKAN TRADING COMPANY

       Vs.

RESPONDENT: SURESH GOVIND KAMAT TARKAR & ORS.

DATE OF JUDGMENT04/04/1986

BENCH: VENKATARAMIAH, E.S. (J) BENCH: VENKATARAMIAH, E.S. (J) THAKKAR, M.P. (J)

CITATION:  1986 AIR 1009            1986 SCR  (2) 182  1986 SCC  (2) 424        1986 SCALE  (1)462

ACT:      Civil Procedure  Code, 1908,  s.148 and  Order 23  Rule 1(3) -  Withdrawal of  suit with  liberty to file fresh suit Permission granted  on payment  of ’costs’ - Whether ’Costs’ to be  deposited ’after’  or ’before’  institution of  fresh suit.

HEADNOTE:      A suit  instituted by  the appellant-firm  against  the respondents was  allowed to  be withdrawn  but on payment of costs of  Rs. 100  with liberty  to file a fresh suit on the same cause  of action  under sub-rule (3) of rule 1 of Order XXIII of  the Code  of Civil Procedure, 1908. The appellant- firm  filed   a  fresh   suit,  which  was  opposed  by  the respondents contendig  that the  suit was  not  maintainable because the  appellant-firm had  failed to  pay the costs of Rs. 100  ’before’ the  filing of  the  suit.  The  appellant offered to  pay the  costs but  the respondents  refused  to accept the  same.  Consequently,  the  appellant-firm,  with permission, deposited  the costs  in the  Trial Court, which held that the suit was maintainable.      The High  Court allowed  the revision petition filed by the respondents  holding that  the suit  was void  ab initio since  the   costs  had   not  been   deposited  before  the institution of the suit.      Allowing the  appeal  of  the  appellant-firm  to  this Court, ^      HELD :  1. The  judgment of the High Court is set aside and the order of the Trial Court is restored. [186 F]      2. While granting permission under sub-rule (3) of Rule 1 of Order XXIII of the Code of Civil Procedure, 1908, it is open to  a court to direct the plaintiff to pay the costs of the defendants.  Even if the order for costs in a given case is construed  as directing  payment of  costs as a condition precedent for  filing a  fresh suit, the defect, if any, may be 183 cured by  depositing in  Court or  paying to  the defendants concerned the  costs within a reasonable time to be fixed by the Court  before the second suit is filed. If the plaintiff fails to  comply with  the said  direction, then  it will be

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open to the Court to reject the plaint, but if the amount of cost is paid within the time fixed or extended by the Court, the suit  shall be deemed to have been instituted validly on the date  on  which  it  was  presented.  This  view  is  in consonance with justice and the spirit of section 148 of the Code of Civil Procedure. [185 F-H; 186 A-B]      Gollapudi Seshavya v. Nadendla Subbayaya & Anr., A.I.R. 1924 Madras  877., Shidramappa  Mutappa Biradar  v. Mallappa Ramachandrappa Biradar, A.I.R. 1931 Bombay 257, Rama Krishna Timmappa Shetti v. Hanumant Patgavi, A.I.R. 1950 Bombay 113, Mast Ram  Ramcharan &  Ors. v. Deputy Commissioner, Bahraich and Anr.,  A.I.R. 1968  Allahabad 321,  Binod Naik & Anr. v. Chandrasekhar  Padhi   &  Ors.,   A.I.R.  1969  Orissa  134, Chikkahanuma v.  Smt. Venkatamma  & Ors., A.I.R. 1971 Mysore 167 and  M/s. Raja  Traders v. Union of India & Anr., A.I.R. 1977 M.P. 55 cited.      3. In  the instant  case the  costs of  Rs. 100 had not been ordered to be deposited as a condition precedent before the institution  of the  next suit.  The plaintiff  was only liable to  pay a  sum of  Rs. 100  by way of costs. The word ’but’ in  the clause  ’this application  is granted  but  on payment of Costs of Rs. 100....’ in the order permitting the withdrawal of  the suit  cannot be  construed as  imposing a condition precedent  for the  filing of fresh suit. There is no warrant for taking a hypertechnical view which results in denying to  a person  access to  justice and deprives him of his legal  rights more  so when  it is  possible to  take  a liberal view which promotes the ends of justice. [186 C-F]

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1205 of 1986.      From the  Judgment and  Order dated  27.9.1985  of  the Bombay High Court Panaji Bench in Civil Revision Application No. 87 of 1985.      Dr. Y.S. Chitale and K.R. Nambiar for the Appellant.      R.F. Nariman,  R. Karanjawala,  H.S. Anand  and Mrs. M. Karanjawala for the Respondents. 184      The Judgment of the Court was delivered by      VENKATARAMIAH, J.  Has justice  become the  lip-aim  of Courts instead  of their  life aim?  Instead  of  dispensing justice is  justice being  dispensed with? Is it a fact that only the  spelling of  the word  (justice) is remembered and the content  of the  concept is  forgotton? Were  it not so, would a  Court in  its  professed  anxiety  to  do  justice, dismiss a  suit as  incompetent on  the ground that a sum of Rs. 100 ordered to be paid as costs whilst granting leave to withdraw the  earlier suit with liberty to file a fresh suit was deposited  ’after’ the institution of the fresh suit and not ’before’ the institution thereof?      Appellant  firm   instituted   a   suit   against   the respondents. On the date of the institution of the said suit the appellant-firm  had not been registered under section 69 of the Indian Partnership Act, 1932, and the suit was liable to fail  on  this  technical  ground.  The  appellant  firm, therefore, prayed  for permission  to withdraw the said suit with liberty  to file  a fresh  suit on  the same  cause  of action under  sub-rule (3)  of rule  1 of Order XXIII of the Code of  Civil Procedure, 1908. That application was granted by  the  Court.  The  operative  part  of  the  order  dated September 4,  1984 passed  on that application read as under :-

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         "Under  such  circumstances  this  application  is           granted but  on payment of costs of Rs. 100 by the           plaintiffs to the defendants. Suit is dismissed as           withdrawn, with liberty to file a fresh suit."      The present  suit, out  of which this appeal by special leave arises, was filed subsequently on October 5, 1984. The appellant filed  an application in that suit for an order of temporary injunction  against  the  respondents.  When  that application came  up for hearing it was pointed out that the appellant had  failed to  pay the  costs of Rs. 100 ’before’ filing the  suit and  so the  suit was  not maintainable. At that stage the appellant offered to pay the costs of Rs. 100 which it  was liable  to pay  under the  order of  the Court dated September  4, 1984.  On the  respondents  refusing  to receive the  costs an  application was made before the trial court for permission to deposit it in the Court by extending the time up 185 to that  date. The  appellant deposited the costs of Rs. 100 in the  trial court  on  that  date.  That  application  was allowed by  the trial  court on  April 12, 1985 by extending the time till January 16, 1985 and holding that the suit was maintainable. Aggrieved  by the  said just  and  fair  order passed by  the trial court, the respondents filed a revision petition before the High Court of Bombay, Panaji Bench (Goa) in Civil Revision Application No. 87 of 1985 questioning its correctness.   The    High   Court   exercising   revisional jurisdiction, after  hearing both  the parties  allowed  the petition holding  that the suit was void ab initio since the costs of  Rs. 100 which had to be paid under the order dated September  4,   1984  had  not  been  deposited  before  its institution.  This  appeal  by  special  leave  is  directed against the said order of the High Court.      We have  heard the  learned counsel  for  the  parties. Parties have  cited  before  us  a  number  of  decisions  : Gollapudi Seshayya v. Nadendla Subbayaya & Anr., A.I.R. 1984 Madras  877,   Shidramappa  Mutappa   Biradar  v.   Mallappa Ramachandrappa Biradar, A.I.R. 1931 Bombay 257, Rama-Krishna Timmappa Shetti v. Hanumant Patgavi, A.I.R. 1950 Bombay 113, Mast Ram  Ram Charan & Ors. v. Deputy Commissioner, Bahraich and Anr.,  A.I.R. 1968 Allahabad 321, Binod Naik and Anr. v. Chandrasekhar  Padhi   &  Ors.,   A.I.R.  1969  Orissa  134, Chikkahanuma v.  Smt. Venkatamma  & Ors., A.I.R. 1971 Mysore 167 and  M/s. Raja  Traders v. Union of India & Anr., A.I.R. 1977 M.P.  55. We  have carefully  considered all  the above decisions. Sub-rule (3) of rule 1 of Order XXIII of the Code of Civil  Procedure, 1908  provides that  where a  Court  is satisfied that  a suit  must fail  by reason  of some formal defect or that there are sufficient grounds for allowing the plaintiff to  institute a  fresh suit for the subject-matter of a  suit or  part of  a cliam, it may, on such terms as it thinks fit,  grant the plaintiff permission to withdraw such suit or  such part  of the claim with liberty to institute a fresh suit  in respect of the subject-matter of such suit or such part  of the  claim. While granting such permission, it is, therefore,  open to  a Court  to direct the plaintiff to pay the costs of the defendants. Even if the order for costs in a  given case  is construed as directing payment of costs as a  condition precedent  for  filing  a  fresh  suit,  the defect, if  any, may  be cured  by depositing  in  Court  or paying to  the  defendants  concerned  the  costs  within  a reasonable time to be fixed by the Court before which 186 the second  suit is  filed. If the plaintiff fails to comply with the  said direction,  then it will be open to the Court

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to reject  the plaint,  but if  the amount  of costs is paid within the  time fixed  or extended  by the  Court the  suit should be deemed to have been instituted validly on the date of which  it was  presented. This  view  appears  to  be  in consonance with  justice whatever  may have  been the  views expressed on  the subject by the various High Courts so far. It does  not militate  against any  express provision of law but on the other hand it advances the cause of justice. This view is also in accord with the spirit behind section 148 of the Code  of  Civil  Procedure,  1908.  All  contrary  views expressed by  the  various  High  Courts,  therefore,  stand overruled.      In the  instant case,  however, a  reading of the order passed on  September 4,  1984 does not even suggest that the costs of  Rs.  100  had  to  be  deposited  as  a  condition precedent before  the institution  of the next suit. It only means that  the application  for withdrawal  of the suit had been granted  and the  plaintiff was  liable to pay a sum of Rs. 100  by way of costs. The word ’but’ in the clause ’this application is  granted but  on  payment  of  costs  of  Rs. 100......’ in  the order  permitting the  withdrawal of  the suit cannot  in the circumstances be construed as imposing a condition precedent  for the filing of the fresh suit. There is no  warrant for  taking a hypertechnical rigid view which results in  denying  to  a  person  access  to  justice  and deprives him of his legal rights more so when it is possible to take  a liberal  view which promotes the ends of justice. The trial  court in obeisance to this principle repelled the unjust plea  urged by  the defendant.  But  alas,  the  High Court, in  exercise of  revisional jurisdiction tripped into reversing the  justice oriented  conclusion reached  by  the trial court.      We,  therefore,   allow  this  appeal,  set  aside  the judgment of  the High  Court and  restore the  order of  the trial court.  The trial court will now proceed to dispose of the suit  in accordance  with law. There will be no order as to costs. A.P. J.                                      Appeal allowed. 187