[Three Judge Bench]: De novo trial in case of return of Plaint under Order VII Rule 10 CPC, Supreme Court

The SC on August 05, 2020 {M/S. EXL CAREERS AND ANOTHER vs FRANKFINN AVIATION SERVICES PRIVATE LIMITED} held that presentation of the plaint in a court contrary to the exclusion clause could not be said to be proper presentation before the court having jurisdiction in the matter.

It was further held by the Bench, comprising of Justice R. F. Nariman, Justice Navin Sinha and Justice Indira Banerjee, that it is no more res­integra that in a dispute between parties where two or more courts may have jurisdiction, it is always open for them by agreement to confer exclusive jurisdiction by consent on one of the two courts.

In the present case, the question of law was referred to a larger bench and required to be answered was that if a plaint is returned under Order VII Rule 10 and 10A of the Code of Civil Procedure   1908,   (herein   called   as   “the   Code”)   for presentation in the court in which it should have been instituted, whether the suit shall proceed de novo or will it continue from the stage where it was pending before the court at the time of returning of the plaint.

The SC (Three Judge Bench) held that statutory scheme now becomes clear. In cases dealing with transfer of proceedings from a Court having jurisdiction to another Court, the discretion vested in the Court by Sections 24(2) and 25(3) either to retry the proceedings or proceed from the point at which such proceeding was transferred or withdrawn, is in marked contrast to the scheme under Order VII Rule 10 read with Rule 10-A where no such discretion is given and the proceeding has to commence de novo. 

However, in the peculiar facts and circumstances of the present case, because the appellant did not raise the objection under clause 16B of the agreement at the very first opportunity, the first order of rejection attained finality, the objection under clause 16B was raised more as an after­thought, the second application under Order VII Rule10 had to be preferred by the respondent, that pleadings of the parties have been completed, evidence led, and that the matter was   fixed   for   final   argument   on   03.07.2017,   the SC  opined   that   despite   having   concluded   that   the impugned order is not sustainable in view of the settled law,   in   exercise   of   its discretionary jurisdiction under Article 136 of the Constitution and in order to do complete and substantial justice between the parties under Article 142 of the Constitution in the peculiar facts and circumstances of the case nonetheless it declines to set aside the impugned order of the High Court dated 13.03.2018. The appeal accordingly stood disposed of by the SC.