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Rameswar Prosad Kessur Prosad Vs. Ramapada Ghose and Sons - Court Judgment

LegalCrystal Citation
Subject Civil
CourtKolkata
Decided On
Reported inAIR1929Cal63
AppellantRameswar Prosad Kessur Prosad
RespondentRamapada Ghose and Sons
Cases ReferredChandmull Kangoria v. Debi Chand
Excerpt:
- .....or inflation of the claim on the part of the plaintiff in the suit, and whether it was a suitable matter to be tried in the high court rather than in the small cause court.13. now, as far as i can see, in the present case, there was a bona fide dispute between two business firms as to the amount which was owed by the one to the other, and in default of an agreement between the parties the amount could only be ascertained by the taking of accounts, the doing of which might have developed into a lengthy and possibly a difficult matter. it happens that in the present case the parties were sufficiently well-advised to avoid the expense of a protracted trial before the learned assistant referee, and they or their counsel or both came to an agreement as to what the amount due by the.....
Judgment:

Costello, J.

1. This is an application to set aside an ex-parte decree made by me on 28th November 1927 on the ground that such decree was obtained improperly and to some texent fraudulently by the plaintiffs in the suit so far as the latter allegation is concerned, it was not seriously or at any rate very strenuously pressed by Mr. Ghosh on behalf of the defendants, who are the applicants in this matter. The only allegation with regard to that seems to have been that in the course of a somewhat provocative correspondence between the attorneys to the parties, the attorney for the plaintiff concealed the fact that he was intending to apply for the decree in question. The main ground upon which the application is founded is that no notice was given under Rule 30, Chap. 10 of the Rules of this Court. That rule provides that certain suits and matters should be placed in the special peremptory lists for the Courts to which they are assigned, and amongst such suits and matters are those defined in Sub-clause (c) as being

suits which stand for confirmation or further consideration upon the report of an officer or other Referee, and testamentary and intestate matters for argument on caveat where grounds in support of the caveat have been filed, on the requisition in writing of the attorney for any party or any party active in person, of which notice in writing shall be given by the party applying to the other party or parties.

2. It is conceded that in the present instance, notice in writing was not given by the party applying, that is to say, the plaintiffs in the suit, and the defendants in fact had no notice that an application was being made for the suit to be put into the special peremptory list for confirmation of the report of the Assistant Referee, who had been appointed by a decree dated 23rd June 1926 to take an account of the dealings and transactions between the parties.

3. The suit was originally brought for the recovery of the sum of Rs. 3451-6-3, and the Assistant Referee in his report, with the consent of the parties, stated that there was due by the defendants to the plaintiffs the sum of Rs. 664-8-0. Now, having regard to the fact that no notice was given by the plaintiffs to the defendants as required by Rule 30, Chap. 10, it was quite clear-that the decree had been irregularly obtained. Therefore, on the face of it, the defendants were entitled to have it set aside. But on the last occasion it was agreed by the parties that this application should be treated rather as an application for the re-hearing of the consideration of the report of the Assistant Referee, so that if it appeared that despite the irregularity arising from the want of notice, the decree was a proper one in the circumstances of the case, the decree should not actually be set aside but should stand as originally made. If, on the other hand, the circumstances war-ranted a variation of the decree, then such variation should be made accordingly.

4. The real point of substance in the application is the question of whether or not the decree should hold good in so far as it ordered the defendants to pay to the plaintiffs the costs of the suit and of the reference upon the footing of Scale No. 2. It was argued by Mr. Ghosh on behalf of the defendants that the matter is one to which Section 22, Presidency Small Cause Court Act applies, and that therefore seeing that the plaintiffs in fact were found entitled to recover the sum of Rs. 664-8-0 only, which is a sum less than Rs. 1000, the plaintiffs were not entitled to any costs at all by reason of the fact that the suit might have been brought in the Presidency Small Cause Court. It was not disputed by Mr. Roy on behalf of the plaintiff's that the criterion to be applied for the purpose of ascertaining whether Section 22 applies or not is not the amount which a plaintiff claims but the amount which he in fact recovers and upon this point I desire to affirm the decision which I gave in the case of Misrilal v. Mackintosh Burn Ltd. Suit No. 537 of 1925, Decided on 31st March 1927. In the course of that suit it became necessary for me to express an opinion as to whether or not the 'cognizability' of a suit to which Section 22 applied depended on the amouut claimed or on the amount actually recovered. In the course of the judgment which I gave in that case I said this:

It is pointed out to me by counsel for the plaintiff that there is a decision of Page, J., which is reported in Chandmull Kangoria v. Debichand : AIR1924Cal405 , in which case Page, J., said in the course of his judgment that the law and practice in British India, in his opinion, were in favour of the view that the question whether a cause fell within the ambit of the jurisdiction of the Small Cause Court depended not on the amount or value actually recoverable or ascertained at the trial but on the amount or value which was claimed by the plaintiff and set out in the plaint, and the learned Judge took the view that the provisions of the English County Court Acts differ so materially from those contained in the statute relevant to the issues raised in the case then before him, that he did not think it necessary to refer to the decisions thereunder.

5. I said at the time that it was clear that Page, J., in his judgment in the case of Chandmull Kangoria v. Debichand : AIR1924Cal405 was of opinion that the question whether or not a suit was cognizable in the Small Cause Court depends not on the amount ultimately recovered but on the amount originally claimed. I referred to that decision of my learned brother on the previous occasion and with very great respect to him I still cannot agree with his view as to the meaning of Section 22. I prefer to follow the decision of Buckland, J., in Suit No. 1657 of 1922 which unfortunately was not reported but is referred to by Page, J., in Chandmull Kangoria v. Debiohand : AIR1924Cal405 .

6. I pointed out in the case of Misrilal v. Mackintosh Burn Ltd. Suit No. 537 of 1925, Decided on 31st March 1927. that there is a case in the Bombay High Court (Sridhan Gopi Nath v. Goberdhone Das) in which Sir Lawrence Jenkins, C.J., and Eussell, J., took a view contrary to that of Page, J. The learned Judges clearly state that the real criterion as to whether or not a case was cognizable by a Small Cause Court was not the amount originally claimed but the true amount or value; the subject-matter of the action is ultimately ascertained after investigation at a trial. The learned Judges in the Bombay case pointed out that such a conclusion was in accordance with the decision of the Court of appeal in England on a cognate point in the case of Solomon v. Mulliner and The Motor Carriage Supply Co. Ltd. [1901] 1 K. B. 76. I desire to say quite definitely that in my view, the real meaning of Section 22, Presidency Small Cause Courts Act, is analogous to that of the corresponding section in the English County Courts Act of 1918, that is to say, Section 11 of that Act, and that is the amount recovered and not the amount claimed which is to be the dominating and deciding factor for the purpose of determining whether or not a suit is cognizable by the Small Cause Court.

7. Mr. Roy contended that even accepting that view of the law, this present suit nevertheless was not a suit cognizable by the Small Cause Court by reason of the fact that, in effect in substance though not in form the plaintiffs were claiming an account, and he referred me to a case in Kailash Chandra Mandal v. Kiranendu Ghose [1916] 24 . C.L. J. l87 where Mukerji, J., and Caspersz, J., decided that whether a suit is one for accounts within the meaning of Article 31, Schedule 2, Provincial Small Cause Court Act (Act 9 of 1887) must depend on the relation in which the parties stand with each other, and the nature of the investigation required to afford relief to the plaintiff, and that if in order to grant relief to the plaintiff it is necessary to take accounts, the suit is one for accounts within the meaning of that article, even though the plaintiff may have chosen to put a definite money value upon his claim. Now that article and that Act of course have no application here. Apparently there is no definite authority, indeed no authority at all for maintaining that a suit for an account cannot be heard and determined in the Presidency Small Cause Court. That is to say, the precise form of the plaint in the present suit is immaterial. Actually the plaintiffs claim a specific sum, namely, Rs. 3451-6-3 but it is obvious from the nature of the suit that the question of whether that sum was or was not due to the plaintiffs could only be determined by the taking of an account between the parties, having regard to the nature of the defence which was set up in the written statement.

8. The facts, put very briefly are these: The parties had had business relations, and by a contract dated 21st January 1922 the plaintiffs had sold a quantity of Australian wheat to the defendants, that is to say, 300 tons of Australian wheat at the rate of Rs. 6-12 per maund on the condition that payment of the price should be made in advance. The defendants actually advanced to the plaintiffs by two sums a total sum of Rs. 56,200 and the plaintiffs delivered a certain quantity of wheat to the defendants, and they further paid to the defendants a sum of Rs. 16,000 upon the footing that the defendants had owed the plaintiffs that amount. The defendants by their written statement set up two other contracts also for the supply of wheat by the plaintiffs to the defendants and in a statement of accounts annexed to their written statement they showed that various other payments had been made with a view to adjusting the accounts between the parties. In that state of affairs it was said by the plaintiffs, as I have already stated, that there was due to them upon an adjustment of accounts the sum of Rs. 3451-6-3. The defendants on the other hand set up that upon any taking of an account it would be found that nothing was due by thern to the plaintiffs, but that on the contrary the plaintiffs were still owing money to the defendants upon the basis that the defendants had paid more to the plaintiffs than was warranted by the amount of wheat which had been actually delivered.

9. Mr. Roy invited me to treat the matter as being one of a claim on the one hand and a sort of counter-claim on the other. He did that admittedly in an endeavour to bring the case within the decision which I had given in the case of Misrilal v. Mackintosh Bum Ltd, Suit No. 537 of 1925, Decided on 31st March 1927. (vide supra) and in order to put himself in the position of being able to contend that the plaintiffs were entitled to the costs of their claim, and that the defendants in their turn would be entitled to the costs of their counter-claim if in fact any sum had been awarded to them. He further said that upon a right view of the report of the Assistant Referee, what the Official Referee had decided in effect was that Rs. 664 was due to the plaintiffs and nothing was due to the defendants. Having reached that stage it was I think difficult for Mr. Roy to thereupon contend that upon that footing the case was taken out of the operation of Section 22, Presidency Small Cause Courts Act, because in fact the total sum awarded to the plaintiff was this sum of Rs. 664 which is clearly less than Rs. 1,000, the sum referred to in that section. Be that as it may, in any event, I should not have been disposed to treat this case upon the same footing as the case of Misrilal v. Mackintosh Burn Ltd. Suit No. 537 of 1925, Decided on 31st March 1927. In that case there was set up by the defendants what under the extension to the Code of Civil Procedure is called an equitable set-off and there was a claim for damages which, in my view, to all intents and purposes (at any rate when it came to a question of costs) was in effect a counter claim properly so-called.

10. There was, however, nothing of the kind in the present instance. The plaintiffs were alleging that a definite sum of Rs. 3,451-6-3 was due to them from the defendants. The defendants, on the other hand, said that no such sum was due, and that if anything, the balance of account was the other way round, clearly, in order to ascertain what, if any, was the sum due to the plaintiffs, it was necessary that an account should be taken. That was the only method of arriving at the amount to which the plaintiffs were entitled, and the Assistant Referee, apparently with the acquiescence of the parties, arrived at the figure of Rs. 664. I think therefore that it is entirely upon the basis of that figure that a decision as to costs ought to be made, especially having regard to the fact that I have not before me, neither in the report nor anywhere else, nor have I any means of ascertaining, without retrying the whole suit over again, what was the figure which represented the sum due from the defendants to the plaintiffs and what, if any, was the figure representing the sum due from the plaintiffs to the defendants, so that upon a balance the sum of Rs. 664 was . due by the defendants to the plaintiffs. For ought I know to the contrary, the Assistant Referee or the counsel to the parties may have come to the conclusion that the defendants owed the plaintiffs Rs. 664 and that the plaintiffs owed the defendants nothing at all. On the other hand, the Assistant Referee or the counsel to the parties may have decided that the plaintiffs owed the defendants such a sum as having another sum subtracted from it would leave a balance of Rs. 664 in favour of the plaintiffs. I have no means whatever of ascertaining how this figure was arrived at. I can therefore only accept the report of the Official Referee as it stands and treat the matter as being one of a suit in which after trial of the issues between the parties it was determined that the defendants owed the plaintiffs the sum of Rs. 664.

11. That being so, the other question is whether there is anything in the suit to take the matter out of the operation of the substantive part of Section 22, Presidency Small Cause Courts Act, once it is conceded and it is not contended from the bar for the purposes of this case [if it had not been conceded, I should have decided the matter consistently with my previous decision in Misrilal v. Mackintosh Burn Ltd. Suit No. 537 of 1925, Decided on 31st March 1927.] that it is the amount recovered and not the amount claimed which is the determining factor. Once that is conceded, it is manifest that on the face of it (prima facie this suit falls within Section 22) that as the plaintiffs are entitled to recover from the defendants the sum of Rs. 664 and no more; by reason of the provisions of Section 22, they will not be entitled to any costs at all. The main part of the section says that if a suit which is cognizable by the Small Cause Court is instituted in the High Court, and if in such suit the plaintiff obtains, in the case of a suit founded on contract, a decree for any matter of an amount or value less than one thousand rupees, no costs will be allowed to the plaintiff; and if in any such suit the plaintiff does not obtain a decree, the defendant shall be entitled to his costs as between attorney and client.

12. I am unable to follow the reasoning of my learned brother Page, J., in the case in Chandmull Kangoria v. Debi Chand : AIR1924Cal405 , to which I have already referred, where he says at page 9 that 'ample safeguards are provided to meet such a contingency,' that is to say, the contingency of the plaintiff placing a fictitious value on his claim so as to be at liberty to determine the tribunal by which the suit is to be tried. I cannot see that there are any safeguards of any kind whatsoever in the event of the plaintiff in a suit of this kind over estimating the value of the amount to which he is entitled, because the real amount can only be ascertained after the taking of some elaborate accounts. It is for that reason, amongst others, that I think it is right, generally speaking, under the provisions of this section that if a plaintiff does not in the ultimate result recover Rs. 1,000 he should not be entitled to his costs. But in the present suit I think the matter is different and Section 22, Presidency Small Causes Courts Act contains an addendum which is in the nature of a proviso. It seems obvious that the Presidency Small Causes Court is not a tribunal intended or disigned for the determination of substantial commercial cases, and I think it is the duty of the Court to deal with the question of costs in a matter of this kind, after a careful examination of the issues which were raised between the parties, particularly for the purpose of ascertaining whether there was any under exaggeration or inflation of the claim on the part of the plaintiff in the suit, and whether it was a suitable matter to be tried in the High Court rather than in the Small Cause Court.

13. Now, as far as I can see, in the present case, there was a bona fide dispute between two business firms as to the amount which was owed by the one to the other, and in default of an agreement between the parties the amount could only be ascertained by the taking of accounts, the doing of which might have developed into a lengthy and possibly a difficult matter. It happens that in the present case the parties were sufficiently well-advised to avoid the expense of a protracted trial before the learned Assistant Referee, and they or their counsel or both came to an agreement as to what the amount due by the defendants to the plaintiff s should be. Some sort of suggestion was thrown out in the course of the hearing that it was intended by this agreement or apparent agreement that the question of costs had also been taken into consideration in arriving at the sum of Rs. 664. I see no reason at all for saying that there was any such idea or intention in the minds of either of the parties to the suit. All that was done when the matter was before the Assistant Referee was for the amount claimed to be ascertained or rather to be agreed.

14. Looking at the matter as a whole, I think that this is a case where I might properly exercise the discretion conferred upon the Court by the last clause of Section 22 and, therefore, while coming to the conclusion that this was a case cognizable by the Small Cause Court and although the plaintiffs were not entitled to a decree for an amount of more than Rs. 1,000, I think I might reasonably say that it was a suit which should be brought in the High Court. That being so, I see no reason why the decree which has already been made should be disturbed. But on the other hand it is clear that the defendants were justified in bringing this matter before the Court, having regard to the manner in which the decree was obtained, and I accordingly give them the costs of this application, and I further direct that the plaintiff's are not to have any costs in connexion with any matters arising subsequent to the report of the Assistant Referee. The defendants are to have costs as between party and party up to the time the the agreement was arrived at and the Referee made his report, including thosein connexion with the filing of the report


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