Calcutta High Court | Amendment of Written Statement in Commercial Suit Permissible | Defendant Allowed to Add Pleas and Documents Except Suppression Allegation
Isabella Mariam
The High Court at Calcutta Commercial Division Single Bench of Justice Krishna Rao permitted the amendment of a written statement filed by the defendant in a commercial suit. The Court recorded that while certain proposed amendments lacked bona fides, the overall plea for amendment was permissible under the liberal standards applicable to defence pleadings. It directed that the written statement may be amended as proposed, except for one paragraph, thereby ensuring compliance with the Commercial Courts Act, 2015 while allowing the litigation to proceed to trial.
The proceedings arose in a long-standing dispute between Soneko Marketing Private Limited, the plaintiff, and Rashmi Metaliks Limited, the defendant. The plaintiff had filed the original suit in 2014 under the Ordinary Original Civil Jurisdiction of the Calcutta High Court as a summary suit under Order XXXVII of the Code of Civil Procedure, 1908. The defendant did not initially file a written statement, and the matter proceeded ex parte, resulting in a decree dated 16 August 2022.
The defendant applied to recall the decree, which was dismissed. On appeal, the Division Bench on 4 July 2023 set aside the ex parte decree, allowing the defendant three weeks to file a written statement subject to conditions, including payment of costs of ₹2 lakhs and furnishing a cash security of ₹50 lakhs. The Division Bench also directed compliance with Section 15(3) of the Commercial Courts Act, 2015.
The defendant thereafter sought to file a written statement affirmed on 24 July 2023, but the Court refused acceptance, holding that only the earlier written statement affirmed on 12 December 2017 could be filed. The Appellate Court, however, permitted the defendant to apply for amendment of the written statement in accordance with law.
In the present application, the defendant prayed for amendment of the 2017 written statement. Counsel for the defendant submitted that the earlier written statement lacked annexures, list of documents, and statement of truth as required under the Commercial Courts Act. It was further submitted that certain relevant defences had not been included, and amendment was necessary to avoid irreparable prejudice. The defendant sought to raise additional grounds, including limitation, suppression of facts, and issues relating to deficient quality of materials supplied by the plaintiff. Documents such as debit notes, an SGS report seized by the CBI, and company petition records were also sought to be incorporated.
The plaintiff opposed the amendment, contending that the defendant had failed to file a written statement despite ample opportunity since 2019 and was now attempting to delay proceedings. It was argued that under Order XI of the Code of Civil Procedure, as amended by the Commercial Courts Act, a defendant cannot introduce documents at a later stage that were in its possession at the time of filing the written statement. Reliance was placed on precedents such as Great Gatsby v. Mahesh Prefab and Sudhir Kumar v. Vinay Kumar G.B. to argue that the defendant could not be permitted to circumvent disclosure obligations.
The plaintiff further submitted that amendment could not deprive the plaintiff of accrued rights and that the plea of suppression of facts lacked bona fides. The plaintiff relied upon M/s. Modi Spinning & Weaving Mills v. Ladha Ram & Co. and Gautam Sarup v. Leela Jetly to contend that amendment of written statement cannot be permitted where it would cause prejudice.
Quoting the Supreme Court in Usha Balasaheb Swami v. Kiran Appaso Swami, the Court recorded: “In the case of amendment of a written statement, the courts are more liberal in allowing an amendment than that of a plaint as the question of prejudice would be far less in the former than in the latter case.”
The Court referred to Sushil Kumar Jain v. Manoj Kumar, observing: “An admission made by a party may be withdrawn or may be explained away. Therefore, it cannot be said that by amendment an admission of fact cannot be withdrawn.” It further cited Basavan Jaggu Dhobi v. Sukhnandan Ramdas Chaudhary to reaffirm that inconsistent pleas may be taken in a written statement.
On the issue of limitation, the Court noted that the Appellate Court in APO No. 39 of 2019 had left the question open for trial, thereby allowing the defence to incorporate this plea.
However, on the plea of suppression of facts, the Court recorded: “Incorporating the ground of suppression of fact is neither explanation of any admission made by the defendant nor the defendant has disclosed in the written statement what are the material facts suppressed by the plaintiff. This Court also did not find any bona fide on the part of the defendant to incorporate the said plea.”
On the attempt to bring new documents, the Court examined the obligations under Order XI Rules 6 to 11 CPC as amended for commercial suits, which mandate disclosure of all documents in the power, possession, control, or custody of the defendant at the time of filing. It noted that the defendant had not originally filed such documents but now intended to rely on them. Recognising that the written statement was affirmed prior to conversion of the case into a commercial suit, the Court distinguished the present facts from those where strict bar on later disclosure applied.
The Court directed: “the defendant is allowed to amend the written statement as proposed in the amended written statement annexed to the supplementary affidavit except paragraph 2 (two) of the propose amendment.” With this, the application, G.A. (Com) No. 7 of 2024, stood disposed of.
Advocates Representing the Parties
For the Plaintiff: Mr. Sarosij Dasgupta, Mr. Biswaroop Mukherjee, Ms. Saheli Bose
For the Defendant: Mr. Subhankar Nag, Mr. Avishek Guha, Mr. Chayan Gupta, Mr. Ankush Majumdar, Mr. Subhajit Das
Case Title: Soneko Marketing (P) Ltd. v. Rashmi Metaliks Limited
Neutral Citation: 2022: CHC-OS:6105
Case Number: G.A. (Com) No. 7 of 2024 in C.S. (Com) No. 739 of 2024 (Old No. C.S. 25 of 2014)
Bench: Justice Krishna Rao
