Premier thermotech (P.) Ltd. and anr. Vs. Indian Sulphacid Industries Ltd. - Court Judgment

Excerpt:
- sections 100-a [as inserted by act 22 of 2002], 110 & 104 & letters patent, 1865, clause 10: [dr. b.s. chauhan, cj, l. mohapatra & a.s. naidu, jj] letters patent appeal order of single judge of high court passed while deciding matters filed under order 43, rule1 of c.p.c., - held, after introduction of section 110a in the c.p.c., by 2002 amendment act, no letters patent appeal is maintainable against judgment/order/decree passed by a single judge of a high court. a right of appeal, even though a vested one, can be taken away by law. it is pertinent to note that section 100-a introduced by 2002 amendment of the code starts with a non obstante clause. the purpose of such clause is to give the enacting part of an overriding effect in the case of a conflict with laws mentioned with the non obstante clause. the legislative intention is thus very clear that the law enacted shall have full operation and there would be no impediment. it is well settled that the definition of judgment in section 2(9) of c.p.c., is much wider and more liberal, intermediary or interlocutory judgment fall in the category of orders referred to clause (a) to (w) of order 43, rule 1 and also such other orders which poses the characteristic and trapping of finality and may adversely affect a valuable right of a party or decide an important aspect of a trial in an ancillary proceeding. amended section 100-a of the code clearly stipulates that where any appeal from an original or appellate decree or order is heard and decided by a single judge of a high court, no further appeal shall lie. even otherwise, the word judgment as defined under section 2(9) means a statement given by a judge on the grounds of a decree or order. thus the contention that against an order passed by a single judge in an appeal filed under section 104 c.p.c., a further appeal lies to a division bench cannot be accepted. the newly incorporated section 100a in clear and specific terms prohibits further appeal against the decree and judgment or order of a single judge to a division bench notwithstanding anything contained in the letters patent. the letters patent which provides for further appeal to a division bench remains intact, but the right to prefer a further appeal is taken away even in respect of the matters arising under the special enactments or other instruments having the force of law be it against original/appellate decree or order heard and decided by a single judge. it has to be kept in mind that the special statute only provide for an appeal to the high court. it has not made any provision for filing appeal to a division bench against the judgment or decree or order of a single judge. no letters patent appeal shall lie against a judgment/order passed by a single judge in an appeal arising out of a proceeding under a special act. sections 100-a [as inserted by act 22 of 2002] & 104:[dr. b.s. chauhan, cj, l. mohapatra & a.s. naidu, jj] writ appeal held, a writ appeal shall lie against judgment/orders passed by single judge in a writ petition filed under article 226 of the constitution of india. in a writ application filed under articles 226 and 227 of constitution, if any order/judgment/decree is passed in exercise of jurisdiction under article 226, a writ appeal will lie. but, no writ appeal will lie against a judgment/order/decree passed by a single judge in exercising powers of superintendence under article 227 of the constitution. - the petitioner erected the plant, but the respondent-company failed to release the payments in accordance with the schedule. 16,70,630.10. in spite of a statutory notice, the respondent-company failed to discharge the liability. 6. the petition was contested by the respondent, inter alia, on the ground that the plant had not been designed, constructed and commissioned in accordance with the terms and conditions of the agreement dated september 26, 1979. at the time of the commencement of its trial in january, 1981, as well as subsequent thereto, various defects were noticed and the petitioner was requested to remove the same. the petitioner also failed to provide and supply the details of drawings of each and every component of the plant as stipulated. 7. the learned company judge, after examining the entire material, came to the conclusion that the defence set up by the respondent-company was in good faith and one of substance and that the proper forum for resolving the dispute as has arisen in the instant case was a civil court and not a petition under section 433 of the act. 11. on the material placed on record, we find that the conclusions arrived at by the learned company judge that the defence set up by the respondent-company was in good faith and one of substance is likely to succeed in point of law.g.r. majithia, j. 1. this appeal is directed against the order of the learned company judge dated may 31, 1985, dismissing company petition no. 136 of 1983 filed by the appellant under section 433 of the companies act, 1956.2. the appellant-petitioner (hereinafter 'the petitioner') moved a petition under section 433 of the companies act, 1956 (hereinafter called 'the act'), for winding up the respondent-company on the ground that it was unable to pay the admitted and due debt of the petitioner. the facts leading to the filing of the company petition, briefly, are :3. the respondent-company intended to erect a plant for the manufacture of sulphuric acid as per isi specification no. is-266-961 with a manufacturing capacity of 75 metric tones per day. it approached the petitioner for erection of the plant at shahabad markanda in haryana. an agreement dated november 22, 1978, was arrived at between the parties, and a sum of rs. 1,00,000 was paid to the petitioner on the same day. the petitioner started the work of erecting the plant immediately thereafter. another agreement dated september 26, 1979, was executed between the parties in which the terms, conditions, rights and liabilities of the parties were incorporated. in the light of the second agreement, the first agreement dated november 22, 1978, lost all significance. but, according to the second agreement, the respondent-company was liable to pay to the petitioner rs. 1.11 crores as price of the plant including installation charges. the payment was to be made by the respondent-company according to the schedule mentioned in the second agreement. the petitioner erected the plant, but the respondent-company failed to release the payments in accordance with the schedule.4. the final inspection of the work was conducted jointly by the officials and experts of both the parties, viz., the petitioner and the respondent, and a joint inspection note was prepared on december 28, 1080. certain points were raised by the respondent-company, but those were of very minor nature. the plant erected by the petitioner was handed over to the respondent-company on or before january 11, 12, 1981, and since then the same is being operated by its technicians and experts.5. a joint meeting was again held after two days between the representatives of the petitioner and those of the respondent-company and all matters were discussed between them. it was admitted by the respondent-company that a sum of rs. 16,97,985.52 was due to the petitioner from it and out of that the respondent-company agreed to furnish a bank guarantee of rs. 4.50 lakhs, which was duly furnished by it. the remaining amount was agreed to be paid in instalments. the petitioner realised the amount of bank guarantee. out of the balance amount of rs. 12,47,985.52, the respondent-company made further payments. a sum of rs. 10,69,724.10 was due from it. the petitioner also claimed an amount of rs. 6,00,906 on account of interest up to october 20, 1983, at the rate of 18.5 per cent. per annum. the total amount due from the respondent-company comes to rs. 16,70,630.10. in spite of a statutory notice, the respondent-company failed to discharge the liability.6. the petition was contested by the respondent, inter alia, on the ground that the plant had not been designed, constructed and commissioned in accordance with the terms and conditions of the agreement dated september 26, 1979. at the time of the commencement of its trial in january, 1981, as well as subsequent thereto, various defects were noticed and the petitioner was requested to remove the same. but, in spite of the petitioner having admitted the defects, it did not remove them. the respondent-company is suffering continuous loss on account of the inherent defects in the plant for which it is liable to be compensated. the respondent-company claimed liquidated damages in terms of the agreement dated september 26, 1979, for excess consumption of sulphur than the guaranteed ratio per tonne of sulphuric acid. the petitioner also failed to provide and supply the details of drawings of each and every component of the plant as stipulated. the respondent alleged that a sum of rs. 26.50 lakhs was due from the petitioner. in the alternative, it is pleaded that even if the petitioner's claim is allowed, the respondent is still entitled to recover rs. 15,80,275.90 from it.7. the learned company judge, after examining the entire material, came to the conclusion that the defence set up by the respondent-company was in good faith and one of substance and that the proper forum for resolving the dispute as has arisen in the instant case was a civil court and not a petition under section 433 of the act.8. learned counsel for the petitioner reiterated the same submissions as were urged before the learned company judge. he submitted that there were no defects in the plant as was being now alleged by the respondent and for that he drew our attention to the directors' reports for the years 1980-81, 1981-82, 1982-83 and 1983-84. he further submitted that in these reports it was not shown that the new machinery had not been working properly. learned counsel then submitted that the defects as are now pointed out in the written statement were never brought to the notice of the petitioner-company during the subsistence of the warranty period.9. both these submissions were duly dealt with in extenso by the learned company judge and he arrived at the firm conclusion that the respondent-company had another plant of the capacity of 6,600 m.t. in the same premises. the production of the said plant in the year 1979-80 was given as 6,913.302 m.t. in the annual report. the capacity of the factory after setting up of the new plant came to 33,000 m.t. in the year 1980-81, the total production from the two plants was 10,769.029 m.t. thus, in spite of installation of another bigger plant, the production of acid did not increase ratably. in the annual report relating to the year 1981-82, the production was shown as 12,225.681 m.t. thus, there was a slight increase in the production, but that was also far less than the installed capacity. in the annual report for the year 1982-83, the actual production came down to 7,162.129 m.t. however, in the annual report for the year 1983-84, the annual production was again shown to be 16,004.126 m.t. on the basis of this material, the learned company judge opined that the production in the said years was far below the rated capacity of both the plants.10. on the second submission, the learned company judge held that even if it be assumed that the plant was formally commissioned in january, 1981, most of the defects were pointed out by the respondent before the expiry of the period of one year from the date of commissioning. he referred to a letter dated may 25, 1982 (annexure i), in which more than a dozen defects in the plant were pointed out, and in reply thereto the petitioner in its letter dated june 4, 1982, admitted the defects and promised to rectify the same. after examining certain other letters placed on record by the respondent, the learned company judge came to the conclusion that even after the defects were pointed out to the petitioner by the respondent, the petitioner was not ready to rectify the same, which it had earlier undertaken to do.11. on the material placed on record, we find that the conclusions arrived at by the learned company judge that the defence set up by the respondent-company was in good faith and one of substance is likely to succeed in point of law.12. apart from this, it will be noteworthy to refer to c. m. no. 1 of 1992 in company appeal no. 20 of 1985 filed by the petitioner, for bringing on record the award dated february 26, 1991, given by the arbitrator and the prayer made by the respondent-company in c. m. no. 35 of 1991 in company appeal no. 20 of 1985 for suspending the hearing in the appeal, in view of the pendency of civil suit no. 974 of 1991 in the high court of delhi. we also recorded the statement of sh. p.c. arya, managing director of the petitioner-company on august 20, 1992, and the same reads thus :'the appellant-company entered into an agreement, dated september 26, 1979, for erection and commissioning of sulphuric acid plant at shahabad markanda. the earlier agreement dated november 22, 1978, was modified by an agreement dated september 26, 1979. this was the only agreement between the appellant and the respondent. the dispute in the instant appeal also arises out of this agreement. the appellant-company moved a petition under section 20 of the arbitration act for appointment of an arbitrator to adjudicate the dispute arising between the appellant and the respondent pursuant to the agreement dated september 26, 1979. on that petition, the delhi high court appointed mr. justice avadh behari rohtagi as sole arbitrator. the sole arbitrator has rendered the award. the appellant-company has moved the delhi high court for making the award rule of the court. the respondents have filed objections under section 30 of the arbitration act. the appellant-company has also filed objections to the award. the delhi high court is seized of the matter and the objections filed pursuant thereto.'13. from the statement of the managing director of the petitioner-company it is apparent that pursuant to the observations made by the learned company judge, the petitioner-company resorted to the remedy as mentioned in the agreement dated september. 26, 1979, which stipulated that in the event of any dispute arising from the agreement, the matter could be referred to the arbitrator. the petitioner-company moved an application under section 20 of the arbitration act for appointment of an arbitrator before the delhi high court which appointed mr. justice avadh behari rohtagi, since retired, as sole arbitrator. the arbitrator has rendered the award and the parties filed objections under section 50 of the arbitration act and the same are pending adjudication. in view of these subsequent events and even otherwise, we are not inclined to interfere with the judgment of the learned company judge.14. for the reasons stated above, the appeal is bereft of any merit and is dismissed, but with no order as to costs. c. m. nos. 1 of 1992, 34 and 35 of 1991 in company appeal no. 20 of 1985 are disposed of accordingly.