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Rana Electrical Industries Vs. Jyoti Wire Industries Pvt. Ltd. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberWrit Petn. Nos. 848 and 849 of 1983
Judge
Reported inAIR1985Bom446; 1984(2)BomCR648; 1984MhLJ851
ActsPresidency Small Cause Courts Act, 1882 - Sections 9(1), 14, 18, 33, 34, 35 and 36; Presidency Small Cause Courts (Bombay) Rules - Rules 9, 36 and 37; Limitation Act - Sections 14
AppellantRana Electrical Industries
RespondentJyoti Wire Industries Pvt. Ltd.
Appellant AdvocateA.G. Katki, Adv.
Respondent AdvocateR.M. Parekh and;K. Shashidharan, Advs.
Excerpt:
.....appeal in forma-pauperis- by dissecting the said clause, a power could not be conferred upon the registrar to deal with the applications for leave to sue within the contemplation of section 18(a) of the presidency small cause courts act,1882. ; b) it was adjudged that from the provisions of sections 9(1)(aa), 14, 33, 34, 35 and 36 of the presidency small cause courts act, 1882 it is quite obvious that the registrar is a 'court' for all practical purposes- therefore section 14 of the limitation act, 1963 would apply to the proceedings instituted or filed before him. - section 3: [s.b. mhase, d.s. bhosale & a.s. oka, jj] offences of atrocities - complaint under held, merely because the caste of the accused is not mentioned in the fir stating whether he belongs to scheduled caste or..........act. therefore so far as the present suits are concerned, orders granting leave to institute the suits passed by the registrar are illegal. therefore judgment and decrees passed in these suits are liable to be set aside and the applications granting leave to sue will have to be returned for presentation to proper court.9. however it was contended before me that order directing return of the plaints of applications will be futile since by now claims in suits are barred by limitation. i do not find any substance in this contention. from the provisions of ss. 9 (1)(aa), 14, 33, 34, 35 and 36,itisquite obvious that the registrar of the small cause court exercises judicial powers. hears suits, passes decrees and an appeal is preferred from a decree of the registrar. thus the registrar,.....
Judgment:
ORDER

1. The only question which requires consideration in these writ petitions is to find out as to whether the Registrar of the Small Cause Court had jurisdiction to grant leave to sue under S. 18(a) of the Presidency Small Cause Courts Act, 1882 in the suits which are not triable by him under S. 14 of the Act.

2. It is contended by the petitioners defendants that the Registrar of the Small Cause Court had no jurisdiction to grant leave to sue under S. 18(a) of the Presidency Small Cause Courts Act, 1882. It is an admitted position that the suits are covered by cl. (a) of the said section and, therefore, leave of the Court was necessary before the institution of the suit itself. It is also an admitted position that such a leave was granted by the Registrar of the Small Cause Court, who was authorised to do so, by a circular dated 3rd July 1975 issued by the Chief Judge of the Court of Small Cause at Bombay. It is apparent that the said circular was issued under S. 9(1)(aa) of the Presidency Small Cause Courts Act, 1882 read with R. 37 of the Presidency Small Cause Courts Rules. However, it is contended by Shri Katki the learned counsel appearing for the petitioners that the circular issued by the Chief Judge is ultra vires as it travels beyond S. 9(1)(aa) of the Act as well as R. 37 of the Rules. In support of this contention Shri Katki has placed strong reliance upon tile decision of the Calcutta High Court in ILR (1907) 34 Cal 619 Laliteshwar Singh v. Rameshwar Singh as well as the decision of the Madras High Court in ILR (1895) 18 Mad 236 (FB) Rajaram Paras Chetty v. Seshayya. According to Shri Katki 11, 13 under S. 9(1)(aa) the High Court can frame rules having a force of law to empower the Registrar to hear and dispose of the undefended suits and interlocutory applications or matters. R. 37 is also in tune with the said section. An application for leave to file a suit under S. 18(a) is not an interlocutory application or matter and, therefore, the circular issued by the Chief Judge dated 3rd July 1975 directing that all applications for leave to sue should be presented in the Court of the Registrar for orders, is wholly ultra vires, as it travels beyond the scope of the Act as well as Rules. It is also contended by the learned counsel that the grant of leave to sue under S. 18( a) of the Act is the foundation of the jurisdiction of the Court. Such a leave is to be granted before the institution of the suit itself, and, therefore, in no case it could be termed as interlocutory application or interlocutory matter. In support of this contention he has placed strong reliance upon the decisions of this court in ILR (1891) 15 Bom 93 - Rampurtab Samruthroy v. Premsukh Chandamal, AIR 1929 Bom 468, -Shamchandra Rampratap v: Bhikamchand Ganeshlal and AIR 1939 Bom 345 - Motilal Tribhovandas Choksey v. Shankarlal Chhaganlal.

3. On the other hand it is contended by the learned counsel appearing for the respondents Shri Trivedi, R. M. Parekh and Shri Devnani representing the Advocate General, that an application for leave to sue within the contemplation of S. 18(a) of the Act, is also an interlocutory application. The interlocutory application cannot be equated with intermediary application. The us or the cause starts with the application itself. Therefore the stages from the start of the lis till its final decision are all interlocutory. The Registrar of the Court of Small Causes is not only an administrative officer but the said post is also a judicial one. Under the Act he has to deal with several matters judicially. To say the least he is part and parcel of the Court of Small Causes itself. It was also contended that the words 'or matters' used in R. 37 or S. 9(l)(a) are not controlled by the expression 'interlocutory' and, therefore, the circular issued by the Chief Judge of the Court of Small Causes was perfectly legal and valid. It was also contended by Shri Devnani that in any case as the suit is ultimately heard and decided by the Court of Small Causes, it cannot be said that the ultimate decree passed is anyway illegal or is a nullity. In support of this contention that the Registrar is a Court, Shri Devnani placed strong reliance upon the decision of the Supreme Court in : AIR1977SC1619 - State of Gujarat v. Ramesh Chandra Mashruwala. For the proposition that the grant of leave to sue is merely an interlocutory order Shri Devnani has placed reliance upon the decision of the Supreme Court in : 1980CriLJ690 V C. Shukla v. State through C. B. I. and : [1977]2SCR306 State of Haryana v. Haryana Co-operative Transport Ltd. It was also contended by Shri Devnani that in any case the orders passed by the Registrar, granting leave to sue are wholly saved by the de facto doctrine as laid down by the Supreme Court in, : 1981CriLJ876 - Gokaraju Rangaraju v. State of Andh. Pra. and therefore, it cannot be said that the decree passed in the present suits are either illegal or ultra vires.

4. For properly appreciating the controversy raised before me it will be worthwhile if a reference is made to the relevant provisions of the Act and to the rules framed thereunder. S. 18 of the Act reads as under:-

'S. 18. Suits in which court has jurisdiction: -. Subject to the exceptions in S. 19, the Small Cause Court shall have jurisdiction to try all suits of civil nature-

When the amount of value of the subject matter does not exceed ten thousand rupees, and -

(a) the cause of action has arisen, either wholly or in part, within the local limits of the jurisdiction of the Small Cause Court, and the leave of the Court has, for reasons to be recorded by it in writing, been given before the institution of the suit, or

(b) all the defendants, at the time of the institution of the suit, actually and voluntarily reside, or carry on business, or personally work for gain, within such local limits, or

(c) any of the defendants, at the time of the institution of the suit, actually and voluntarily resides, or carries on business or personally works for gain, within such local limits and either the leave of the Court has been given before the institution of the suit, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution;

(Provided that where the cause of action has arisen wholly within the local limits aforesaid, and the Court refuses to give leave for the institution of the suit, it shall record in writing its reasons for such refusal).

Explanation I - -

Explanation II - -

Explanation III - - '

Then comes S. 9 which deals with the procedure and practice of the Court of Small Causes. It authorises the High Court, to frame rules having the force of law for prescribing procedure to be followed and the practice to be observed by the Court of Small Causes. S. 9(l)(aa) of the said Act reads as under:

('9(aa) empower the Registrar to hear and dispose of undefended suits and interlocutory applications or matters, and)'

Then comes R. 9 and R. 37 of the Rules which are relevant for deciding the controversy raised before me. R. 9 reads as under:

'9. All applications made under S. 18 of the Presidency Small Cause Courts Act, 1882, for leave to institute a suit, shall be in writing signed and verified on oath or solemn affirmation by the person making the same. Such applications shall set forth exactly the facts of the case and the grounds on which the plaintiff invokes the jurisdiction of the Court. The plaintiff shall also state in his application for leave to sue if any of his witnesses resides in Bombay. In such a case a copy of such application shall be served upon each defendant along with the summons'.

Then comes R. 37 which reads as under :

'37. The Registrar is empowered to hear and dispose of undefended suits and such interlocutory applications or matters as he may be directed to hear and dispose of by the Chief Judge and also to make an order for payment of moneys deposited in Court in such case, not falling under S. 35 of the Presidency Small Cause Courts Act, 1882 as the Chief Judge may, by general or special order, from time to time direct'.

It is no doubt true that before the Courts below reliance was also placed upon R. 36 of the Rules which lays down that in the ordinary course the work enumerated in the said rule shall be disposed of by the Registrar. The relevant clause of the R. 36 reads as under :

'Application for leave to sue or to appeal in forma pauperis'.

However, before me no reliance was placed on this rule for supporting the power of the Registrar to deal with the applications under S. 18(a) of the Act and in my opinion rightly. The said clause only deals with the application for leave to sue or to appeal in forma pauperis. By dissecting the said clause, a power cannot be conferred upon the Registrar to deal with the applications for leave to sue within the contemplation of S. 18(a) of the Act. That will amount to mis-reading the provision. R. 36(i) only deals with the application for leave to sue in the forma pauperis or the application for leave to appeal in forma pauperis. Therefore the said rule was not rightly pressed in aid by the counsel for the respondents.

5. Rule 37 will have to be read with S. 9(l)(aa) of the Act. The Full Bench of the Madras High Court in Rajaram Chetty's case ILR (1895) Mad 236 was concerned with S. 33 of the Act which authorises delegation of non-judicial duties only. It appears that under S. 33 power to deal with the applications under S. 18(a) and (c) of the Act was delegated to the Registrar of the Court of Small Causes, Madras. The Madras High Court held that granting of leave to sue under S. 18 of the Presidency Small Cause Courts Act, is not a non-judicial or quasi-judicial act which could be performed by the Registrar and, therefore, the rule framed in that behalf was ultra vires and void. Admittedly after the said Full Bench decision of the Madras High Court the Act came to be amended and S. 9(l)(aa) was introduced by Act III of 1899. In Laliteshwar Singh's case ILR (1907) Cal 619 the Calcutta High Court was concerned with the controversy as to whether the order granting leave to sue under S. 12 of the Letters Patent is a judicial act or otherwise. Having held that the said power is a judicial one, the Calcutta High Court held that R. 515A of the Rules and orders of the High Court, in so far as it authorises the Registrar or Master to grant leave under cl. 12 of the Letters Patent, is ultra vires it is not disputed before me that the order granting leave to sue under cl. 18 of the Act is a judicial act and not a ministerial one and, therefore on that footing the controversy raised before me will have to be decided.

6. By S. 9(l)(aa) the High Court is empowered to frame rules empowering the Registrar to hear and dispose of the undefended suits and interlocutory applications or matters. R. 37 is framed by the High Court in exercise of the said power. However, I find it difficult to accept the contention of the respondents that the application made under S. 18 for, leave to institute a suit is either an interlocutory application or could be termed as interlocutory matter. If S. 9(l)(aa) is read as a whole then it is quite obvious that the expression 'interlocutory' covers and governs both that is 'applications or matters'. The words or matters cannot he read independent of expression 'interlocutory'. Therefore the only power which could be conferred upon the Registrar under second part of S. 9(l)(aa) is to deal with the interlocutory applications or interlocutory matters. R. 37 also will have to be interpreted accordingly.

7. However relying upon the decision of the Supreme Court in V. C. Shukla's case : 1980CriLJ690 it was contended by Shri Devnani that the application for leave to sue is merely an interlocutory application. In no case the power to grant leave to sue can he termed as interlocutory. As held by this Court in Motilal Tribhuvandas's case, AIR 1939 Born 345 obtaining of leave to sue is the foundation of the jurisdiction and such leave must be obtained before the institution of the suit and not afterwards. Wherever such a leave is necessary it is a condition precedent to the Court having jurisdiction to entertain the suit and this is the reason why such a leave has to be obtained at the time of institution of the suit itself. Grant of leave is a judicial act and it affords the very foundation of jurisdiction. Once it is held that obtaining of leave under S. 18(a) of the Act is the foundation of jurisdiction or a condition precedent to the Court having jurisdiction to entertain the suit and is to be obtained before the institution of the suit itself and cannot be granted afterwards, then such a matter or order cannot be termed as interlocutory. Therefore, the Chief Judge of the Court of Small Causes obviously travelled beyond his jurisdiction in issuing the circular dated 3rd July 1975 directing that applications for leave to sue should be presented in the Court of Registrar for orders. To that extent it will have to be held that the directions issued by the Chief Judge of the Court of Small Causes in that behalf are ultra vires of the powers conferred upon him by R. 37 of the Rules.

8. However, it is needless to say that under the Act judicial powers are also conferred upon the Registrar. In State of Gujarat v. Rameshchandra's case : AIR1977SC1619 the Supreme Court had an occasion to consider as to what is the status of the Registrar of the Court of Small Causes. Though by S. 13 of the Act it is declared that the Registrar shall be the Chief ministerial officer of the court, under S. 9(l)(aa) the High Court may from time to time by rules, having the force of law, empower the Registrar to hear and dispose of the undefended suits and interlocutory applications or matters. Under S. 14 of the Act, the provincial Government can invest the Registrar with the powers of a Judge under the Act for the trial of the suits in which the amount or value of the subject matter does not exceed Its. 100/-. By S. 34 it is made clear that the suits cognizable by the Registrar under S. 14 are to be heard and determined by him in like manner in all respects as a Judge of the Court might hear and determine the same. By Ss. 35 and 36 certain judicial powers are also conferred upon him. Therefore obviously so far as the matters which are within the cognizance of the Registrar or with which he can judicially deal with, he is 'a court'. Therefore if the Suit was such in which amount or the value of the subject matter did not exceed Rs. 100/-, then obviously leave could have been granted by the Registrar under S. 18(a) of the Act because so far as those suits are concerned he is a court within the meaning of S. 1 8 of the Act. However in the present case I am dealing with the suits which are beyond the competence of the Registrar since the amount claimed therein exceeds Rs. 5000.00/-. The suits were not undefended suits but were contested one and, therefore obviously were not covered by section 14 or section 9(1)(aa) of the Act. Therefore so far as the present suits are concerned, orders granting leave to institute the suits passed by the Registrar are illegal. Therefore judgment and decrees passed in these suits are liable to be set aside and the applications granting leave to sue will have to be returned for presentation to proper court.

9. However it was contended before me that order directing return of the plaints of applications will be futile since by now claims in suits are barred by limitation. I do not find any substance in this contention. From the provisions of Ss. 9 (1)(aa), 14, 33, 34, 35 and 36,itisquite obvious that the Registrar of the Small Cause Court exercises judicial powers. hears suits, passes decrees and an appeal is preferred from a decree of the Registrar. Thus the Registrar, Small Cause Court. inasmuch as he exercises judicial function is a judicial officer. Under the said provisions of the Act, he performs judicial functions and has been empowered to render definitive decisions, which have finality and authoritativeness so as to bind the parties appearing before him. He derives his authority to dispose of the matters judicially from the State directly under the Statute. Thus he satisfied all the criteria laid down by the Supreme Court in Thakur Jugal Kishor Sinha v. Sitamurhi Central Coop-Bank Ltd. : 1967CriLJ1380a and the Full Bench of this court in : AIR1975Bom143 Bapusaheb Babasaheb Patil v. State of Maharashtra and, therefore, is a 'court' for all practical purposes. Therefore S. 14 of the Limitation Act, will apply to the proceedings instituted or filed before him.

10. An apprehension was also expressed before me that if it is held that the direction issued by the Chief Judge is wholly ultra vires then the orders, judgments and decrees already passed on the basis of the leave granted by the Registrar will be rendered without jurisdiction and could be treated as a nullity. I do not find any substance in this apprehension. It is no doubt true that granting of leave to sue is the foundation of the jurisdiction. But it cannot be disputed that under S. 18 of the Act the Small Cause Court Bombay has inherent jurisdiction to entertain and try such suits. This is not a case where it could be said that there was inherent lack of jurisdiction in the Court of Small Causes to entertain the suit and to pass decree in that behalf

11. The Registrar was exercising the jurisdiction of granting leave to sue under S. 18(a) of the Act, by virtue of the power vested in him under the circular issued by the Chief Judge on 3rd July 1975. The Chief Judge had issued the circular in bona fide exercise of the power under rule 37 read with S. 9(l)(aa). Therefore the Registrar was not a mere intruder or usurper but passed the orders under the colour of lawful authority, though it is now held that delegation under the circular was defective. In these circumstances orders passed by him when he was clothed with the powers, have the same efficacy as orders passed by a Judge de jure. (See Gokaraju v. State of Andhra Pradesh : 1981CriLJ876 If such Orders were passed, and no objection was raised by the defendants at the initial stage of the suit, and suit proceeded and judgments and decrees were also passed, then judgments and decrees cannot be treated as a nullity, nor can they be challenged in execution proceedings or in any other collateral proceedings. After the grant of leave to sue further steps in the suit are taken by the court, who has jurisdiction over the subject matter of the suit, and the parties to it. The Court which pronounced judgment or passed the decree was not inherently lacking in jurisdiction.

12. The Supreme Court had an occasion to deal with somewhat similar question in : [1962]2SCR747 -Hira Lal Patni v. Kali Nath. In that case also the plaint was filed after 'obtaining the necessary leave of the High Court under cl 12 of the Letter: Patent. A question was then raised as to whether the leave obtained had been rightly or wrongly obtained. The Supreme Court held that such a matter cannot be agitated at the execution stage. This is what the Supreme Court observed in this context:

'4......... The validity of a decree can be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seizingg of the case because the subject matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit or over the parties to it. But in the instant case there was no such inherent lack of jurisdiction'.

...... It is well settled that the objection as to local jurisdiction of a court does not stand on the same footing as an objection to the competence of a court to try a case. Competence of a court to try a case goes to the very root of the jurisdiction, and where it is lacking, it is a case of inherent lack of jurisdiction. On the other hand an objection as to the local jurisdiction of a court can be waived and this principle has been given a statutory recognition by enactments like S. 21 of the C. P. C. Having consented to have the controversy between the parties resolved by reference to arbitration through court, the defendant deprived himself of the right to question the authority of the court to refer the matter to arbitration or of the arbitrator to render the award. It is clear, therefore, that the defendant is estopped from challenging the jurisdiction of the Bombay High Court to entertain the suit and to make the reference to the Arbitrator. He is equally estopped from challenging the authority of the arbitrator to render the award'.

The view taken in this case is' reaffirmed by the Supreme Court in Bahrein Petroleum Co. Ltd. v. P. J. Pappu : (1966)IILLJ144SC . This is what the Supreme Court observed in paras 3 and 4 of the said judgment:

'3. Counsel for the plaintiff-respondent submitted that it was open to the defendants to waive this objection, and if they did so, they would not subsequently take the, objection. This submission is well founded. As a general rule, neither consent nor waiver nor acquiescence can confer jurisdiction upon a court, otherwise incompetent to try the suit. But S. 21 of the Code provides an exception, and a defect as to the place of suing, that is to say, tile local venue for suits cognisable by the courts under the Code may be waived under this section. The waiver under S. 21 is limited to objections in the appellate and revisional courts. But S. 21 is a statutory recognition of the principle that the defect as to the place of suing under Ss. 15 to 20 may be waived. Independently of this section the defendant may waive the objection and may be subsequently precluded from taking it, see Hira Lal Patni v. Sri Kali Nath : [1962]2SCR747

4. Counsel for the plaintiff further submitted that, as a matter of fact, the defendants by their conduct have waived the objection. Though this submission found favour with the High Court, we are unable to accept it. If the defendant allows the trial court to proceed to judgment without raising the objection as to the place of suing and takes the chance of a verdict in his favour, he clearly waives the objection, and will not be subsequently permitted to raise it. It is even possible to say that long and continued participation by the defendant in the proceedings without any protest may, in an appropriate case amount to a waiver of the objection But, in this case, we find no conduct of the defendants which amounts to a waiver, or which precludes them from raising the objection'.

13. I am aware of the fact that S. 21 in terms does not apply to the proceedings instituted under the Presidency Small Cause Courts Act. However, as observed by the Supreme Court in the aforesaid decision, independently of the section, the defendant may waive the objection and may be subsequently precluded from taking it. Further it cannot be forgotten that the litigating parties cannot be punished for the act of the Court. By issuing circular dated 3rd July 1975 which is obviously based on misconception of the provisions of law, decrees already passed or proceedings already taken cannot be rendered as without jurisdiction or treated as nullity. It appears that right from the year 1975 in view of the directions issued by the Chief Judge, as a rule such applications are placed before the Registrar, and the litigating parties never objected to it; Registrar also exercised the power or jurisdiction as per directions issued by the Chief Judge. Therefore to such cases de facto doctrine as laid down by the Supreme Court in Gokaraj Rangraju's case : 1981CriLJ876 will aptly apply. Under the circular issued by the Chief Judge, the Registrar within his assumed official authority passed the orders in the interest of public or third persons and not for his own benefit. Therefore, applying the de facto doctrine which is now well settled, it will have to be held that the final orders passed, without an', objections from the parties, are generally valid and binding as if they were the actions of the officers de jure. Therefore it cannot be said that all the orders passed by the Registrar right from the year 1975 till today granting leave to sue under S. 18 of the Act will be rendered without jurisdiction. On the contrary such orders and consequential judgments and decrees passed by the court will be perfectly legal and valid and will also be binding upon the parties.

14. However in the present cases right from the very inception objections were raised by the defendants in that behalf. This is not a case where it could be said that the defendant accepted the order passed by the Registrar without any objection and thereafter participated in the proceedings. A challenge to the jurisdiction of the Registrar to pass such an order was raised at the very first opportunity. It was duly pressed by the defendants at all the stages. This is not a case where it could be said that after the order was passed by the Registrar granting leave to sue, the suit proceeded without any protest. In the present cases it cannot also be said that the defendants submitted to the jurisdiction of the court without any objections. Therefore as already held in the present suits the judgments and decrees passed by both the Courts below will have to be set aside and plaints together with applications for leave to sue will have to be returned to the plaintiffs for presentation to the proper forum, so far as these two suits are concerned.

15. In the result, therefore, rule is made absolute. The judgments and decrees passed by both the courts below are set aside and the Court of Small Causes at Bombay is directed to turn the plaints to the plaintiffs for presentation to proper forum. On such return of the plaints and applications, the plaintiffs will be entitled to present the same to the proper court or forum. As already observed the question of limitation will not arise in view of the provisions of S. 14 of the Limitation Act. After the suits are properly presented and instituted the Court of Small Causes shall deal with them in 'accordance with law. However, in the circumstances of the case there will be no' order as to costs, in both these writ petitions.

On the request of the respondents the operation of this order and the directions issued for return of the plaints to the plaintiffs are stayed for a period of six weeks.

16. Ordered accordingly.


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