2021 (12) TMI 1476 - HC - Indian Laws

Defendants lose right to file written statement after Order 8 Rule 1 CPC deadline expires despite lockdown

Bombay HC dismissed a petition challenging refusal to accept written statement filed beyond statutory limitation period. Defendants sought injunction ... Seeking an injunction and restraint order against the defendants from using, divulging, distributing, publishing, revealing or dealing with the proprietary information and trade secrets of the plaintiff - whether the period of limitation for fling of written statement, as contemplated under Order 8 Rule 1 of the CPC got automatically attended, since it is expired during the period of lockdown and to be precise on 09/05/2020? HELD THAT:- A Similar argument was advanced before the Hon’ble Supreme Court in case of SAGUFA AHMED & ORS. VERSUS UPPER ASSAM PLYWOOD PRODUCTS PVT. LTD. & ORS. [2020 (9) TMI 713 - SUPREME COURT] qua the limitation for fling of an Appeal before the National Company Law Appellate Tribunal, on dismissal of the proceedings by the NCLT on 04/08/2020, Section 421 of the Companies Act, 2013 which provide an Appeal to the Tribunal, which shall be fled within a period of 45 days, from the date on which a copy of the order of Tribunal is made available. The proviso, however, permit the Tribunal to entertain an Appeal after expiry of the said period of 45 days, but within a further period not exceeding 45 days, on being satisfied that the appellant was prevented by sufficient cause from fling the Appeal within that period. In the said case, period of 45 days was over on 02/02/2020 and the attended period, which was the discretionary period, also expired on 18/03/2020, before which the Appeal was not fled, but the Appeal came to be fled only on 28/07/2020. There are no other option is available to me in the facts of the given case. The statutory period of limitation within which the written statement could be fled in the present case came to be attended by the discretionary power of the Court and even the period of 120 days expired on 09/05/2020 and when the lockdown came to be imposed, ‘period of limitation’ having already expired, the benefit of the order of the Hon’ble Supreme Court cannot be attended to the defendants. The learned Judge has committed no error in refusing to accept the written statement on record, holding that the defendants have forfeited their right to file the written statement, on expiry of period of 120 days. Finding no legal infirmity in the impugned order, the same is upheld - petition dismissed. Issues Involved:1. Whether the period of limitation for filing a written statement, as contemplated under Order 8 Rule 1 of the CPC, got automatically extended due to the COVID-19 lockdown.2. Whether the defendants are entitled to the benefit of the Supreme Court's order extending the limitation period during the pandemic.Issue-wise Detailed Analysis:1. Period of Limitation for Filing Written Statement:The plaintiff filed a commercial suit seeking an injunction against the defendants from using proprietary information and trade secrets. The defendants received summons on 10/01/2020 and were required to file their written statement within 30 days. Extensions were granted until 24/03/2020. Due to the COVID-19 pandemic and subsequent lockdown, the courts functioned for limited hours, making it impossible for the defendants to file the written statement within the stipulated period. The defendants filed an application on 02/07/2020 to bring the written statement on record, which was opposed by the plaintiff on the grounds of delay. The District Judge rejected the application, stating the matter shall proceed without the written statement of defendant Nos. 1 and 6.2. Supreme Court's Order on Limitation Period:The core issue was whether the period of limitation for filing the written statement got automatically extended due to the lockdown. The defendants argued that the Supreme Court, in Suo Motu Writ Petition No.3 of 2020, extended the limitation period for all proceedings from 15/03/2020 till further orders. The defendants contended that the statutory period of 30 days for filing the written statement, which could be extended up to 120 days at the court's discretion, should be considered within the extended limitation period due to the pandemic.Plaintiff's Argument:The plaintiff argued that the defendants should have filed their written statement within 120 days from the date of receipt of summons. Since they failed to do so, their right to file the written statement stood forfeited. The plaintiff relied on the Supreme Court's decision in M/s. SCG Contracts India Pvt. Ltd. Vs. K.S. Chamankar Infrastructure Pvt. Ltd. & Ors., which held that the consequences of non-filing of the written statement within the prescribed time are mandatory, especially in commercial suits.Court's Analysis:The court referred to the Supreme Court's order in Sagufa Ahmed & Ors. Vs. Upper Assam Polywood Products Private Limited and Ors., which clarified that the extension of limitation was only for the 'period of limitation' and not for the period up to which delay can be condoned. The court observed that the statutory period for filing the written statement expired on 09/05/2020, and since the lockdown was imposed on 24/03/2020, the defendants could not benefit from the Supreme Court's order extending the limitation period.Conclusion:The court concluded that the defendants' right to file the written statement stood forfeited as the period of 120 days had expired before the lockdown. The benefit of the Supreme Court's order could not be extended to the defendants. The court upheld the District Judge's order, finding no legal infirmity, and dismissed the writ petition.