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This article is written by Abhijith Christopher who is pursuing a Certificate Course in Advanced Civil Litigation- Practice, Procedure and Drafting from LawSikho.

Introduction

The meaning of the term “counter claim” can be interpreted from a bare perusal of Order 8 Rule 6A of the Code of Civil Procedure, 1908 (“CPC”). This rule, along with rules 6B to 6G of the CPC, was inserted after the enactment of the CPC (Amendment) Act of 1976. This amendment came as a result of the 27th Law Commission Report, 1964 that emphasized upon conferring the defendant with a right to file a counter claim. Rule 6A states that the defendant, by means of a counter-claim can claim any form of a right or a claim with respect to a cause of action that accrues w.r.t. to the defendant against the claim of the plaintiff.

The Hon’ble Delhi High Court in the case of Gastech Process Engineering (India) Pvt. Ltd. v. Saipem has observed that “counter claim is a weapon of defence and enables the defendant to enforce a claim against the plaintiff and is allowed to be raised to avoid multiplicity of proceedings.  

Further, it was held by the Hon’ble Bombay High Court in the case of Manikchand Fulchand Katariya v. Lalchand Harakchand Katariya held that a counter claim which is filed in accordance with Order 8 Rule 6A in not just limited to a money suit, but also with respect to a decree for possession filed by the defendant in a suit that has been instituted by the plaintiff for injunction.

Furthermore, it was observed in the cases of Hem Narain Thakur v. Deo Kant Mishra [2000 AIHC 945] and Allahuddin Kadri v. Devander Singh [1996 (1) Raj. 408], that the counter claim is not maintainable against anyone other than the plaintiff since “neither the defendant nor the petitioner has the right under Order 8 Rule 6A of the CPC to file counter claims for the damages alleged to be caused by a person who is not a party to the suit.”.

When to file a counter claim?

According to the wording of Rule 6A, CPC there are three essential situations as to when the counter-claim can be filed, which can be found listed as follows:

  • before or after filing the suit, but 
  • before the defendant has delivered his defence, or 
  • before the time limited for delivering his defence has expired.

Such a claim can have the nature of a claim for damages and otherwise as well, as can be made out from a bare perusal of the rule. Furthermore, it was held by the Hon’ble Apex Court in the case of Ashok Kumar Kalra v. Wing Cdr. Surendra Agnihotri that the court shall permit the filing of the counter claim only after the written statement is filed, but not after the issues are formulated. Nevertheless, an exception is allowed in some extraordinary situations where the counter claims can be filed even after the issues are framed so as to prevent the institution of multiple proceedings.

Differences between a counter claim and a set off

It is not uncommon for a person analyzing Order 8 of the CPC for the first time to confuse the meaning of a set off with that of the counter claim. The analysis of the following section will be instrumental in demystifying the differences between the meaning of counter claim and a set off. 

Order 8 Rule 6 of the CPC mentions the meaning of a set off. It states as follows:
“The written statement shall:

  • have the same effect as a plaint in a cross-suit; 
  • enable the Court to pronounce a final judgment; 
  • in respect both of the original claim and of the set-off
  • not affect the lien, upon the amount decreed, of any pleader in respect of the costs payable to him under the decree.

As can be made out from the aforementioned definition, the written statement in a set off does not constitute a separate suit by itself rather has an effect similar to that of a plaint which is filed in a cross suit, and is instrumental in assisting the court in arriving upon a judgment with regard to the suit as a whole. According to the third point mentioned above, as a part of the section, the written statement shall apply both to the claim filed originally and the set-off in this regard. And finally, the written statement shall not affect any aspect of the suit that has been filed with regard to the costs payable under the decree rendered by the court, such as a lien or the amount that is decreed with regard to a pleader with regard to the costs that he is entitled to as a result of the same. 

Counter-Claim: On the contrary, a counter claim under Order 8 Rule 6A enables the defendant to set up a counter claim (which has an existence identical to that of a claim in itself) against the claim filed by the plaintiff, and this is a provision that adds to his right to plead a set off under Rule 6.

Unlike a set off, which exists in a way similar to that of a plaint which is filed in a cross suit, the counter-claim has the same effect as a cross suit, as can be made out from a bare perusal of Order 8 Rule 6A(2), which states that, “Such counter-claim shall have the same effect as a cross-suit so as to enable the Court to pronounce a final judgment in the same suit, both on the original claim and on the counter-claim.”.

Furthermore, it was held by the Hon’ble High Court of Kerala in the case of Sarojini Amma v. Dakshyani Amma that “a counter claim has the same effect as a cross suit and has to be disposed of along with the main suit in which it is filed; the only limitation is that the Court should be competent to dispose of the counter claim and the main purpose of setting up a counter claim is to prevent multiplicity of proceedings between the parties..

Measures that can be taken by the plaintiff post the filing of the counter claim 

Grounds under which a counter claim can be excluded

According to Order 8 Rule 6C, in a situation where the defendant initiates a counter claim and the plaintiff comes up with a contention whereby it is pointed out with sufficient reasons that the claim so raised should not be disposed of by a counter-claim but rather, by an independent suit, the counter claim can be excluded as a result. The plaintiff has to apply for an order for the exclusion of the counter claim before the court settles the issues in relation to the counter claim.

In the case of Malaga Realtors Private Limited v. Vilas Pundalik Malik and Ors., the original defendants had taken an exception to the order of the Senior Judge at Mapusa directing the exclusion of the counter claim so filed by them. The plaintiffs in this case had moved the application for exclusion stating that, if at all the defendants had a title over the suit property, their claim was meant to be adjudicated upon and dealt with in an independently filed suit, and not in the one filed by them. It was subsequently held by the Hon’ble High Court of Bombay at Goa that no prejudice had been caused to the petitioners or the original defendants by the exclusion of the counter claim in this regard, that no cause of action could be made out in that regard, and hence the petition was dismissed accordingly.

Consequences of a default on the part of a plaintiff while filing the reply to the counter claim 

As per Order 8 Rule 6E, the plaintiff has to take care to ensure that there is no default which arises on their part when it comes to putting in a reply to the counter claim filed, so as to ensure that the court does not proceed with pronouncing a judgment against them in the counter-claim so initiated by the defendant. In the case of Jeenat Parveen and Ors. v. The Civil Judge, the court did not allow the petitioner to undertake the filing of the reply to the counter claim filed by the respondents while noting that this would only delay the proceedings further. The petitioners in the aforementioned case had not filed the reply for more than one year and five months, hence the judgment. It must hence be ensured by the plaintiff that no such default ever arises so as to avoid coming within the ambit of the provision stated in Order 8 Rule 6E.

Conclusion

According to Order 8 Rule 6F, where the counter claim filed by the defendant succeeds, the court always renders a judgment in favour of the former. It must also be noted that according to Order 8 Rule 6 “the rules relating to a written statement by a defendant shall apply to a written statement filed in answer to a counter-claim”.

Furthermore, considering many instances where the counterclaim has been filed against parties other than the plaintiff, it must also be noted that it has the potential of turning into a tool in the hands of an unscrupulous defendant so as to delay the court in disposing of the suit, and can in turn, contribute towards unnecessary vexatious litigation.


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