Calcutta High Court Upholds Commercial Court Order Permitting Fresh Counterclaim After Transfer Of Suit

The Calcutta High Court has recently declined to interfere with a Commercial Court order allowing a defendant to file an additional written statement along with a counterclaim after the suit was transferred to the Commercial Court. The court held that such pleadings can be permitted with the court's leave under the Code of Civil Procedure.

Justice Shampa Dutt (Paul) dismissed a civil revision filed by Batliboi Environmental Engineering Limited, observing that “the impugned order in the present case being in accordance with law requires no interference.”

The case arose from a money suit between Batliboi Environmental Engineering Limited and Eastern Metec Private Limited. The suit was first pending before a civil court and was later transferred to the Commercial Court under the Commercial Courts Act, 2015. The defendant had already filed a written statement there, but without any counterclaim.

After the transfer, the Commercial Court recorded that mediation had failed. It then directed the defendant to file its written statement along with a counterclaim within 48 hours and allowed it to place original documents on record. The plaintiff objected, saying the defendant could not file a fresh written statement after having already filed one earlier.

Before the High Court, the plaintiff contended that the transfer did not mean the case would begin afresh and that allowing a new written statement with a counterclaim was contrary to Order VIII Rule 6A CPC and prejudicial to it.

The defendant, however, argued that a subsequent cause of action had arisen after the earlier written statement was filed and relied on Order VIII Rules 8 and 9 CPC to submit that additional pleadings, including a counterclaim, could be accepted with the court's leave.

Considering the scheme of Order VIII Rules 6A, 8 and 9 CPC, the High Court observed:

“the provision under Order VIII Rule 9 CPC is very clear that there cannot be any further pleadings, subsequent to a written statement filed by the defendant, other than by way of defence, as a counter claim and the same can be accepted with the leave of the Court.”

The court noted that the Commercial Court had granted such leave in this case. Holding that the order was “in accordance with law,” the High Court dismissed the revision.

It allowed the plaintiff to file its written statement to the counterclaim within the prescribed time, directed the trial court to proceed expeditiously, and vacated any interim order.

For Petitioner: Advocates U. S. Menon, Abhirup Chakraborty, and Tuhin Ganguly

For Respondent: Advocates Debjani Sengupta, Subhankar Nag, Soumya Ray, Anwesha Saha, Vaswati Banerjee, and Pramit Panda