Delhi District Court
Madhu Jain vs M/S Mani Plastic Store on 23 July, 2025
BEFORE THE COURT OF SH. SURINDER S. RATHI, DISTRICT JUDGE
(COMM.)-11 CENTRAL, THC, DELHI
CS Comm. No. 355/2024
Madhu Gupta
W/o Late Sh. Pramod Gupta
Office at: Ground A2 Swami Dayanand
Colony, Kishan Ganj, Central, Delhi-110007
and
R/o 273/3, Gali No. 13
Than Singh Nagar, Anand Parbat
Central Delhi, Delhi-110007 .............Plaintiff
Vs.
M/s Mani Plastic Store
Proprietor Pradeep Bajaj
Office at: Ward No. 18, Holding No. 54B
Pithapur, Pithapur Road, Buxibazar
Cuttack, Odisha -753001 ............Defendant
Date of Institution : 13.03.2024
Date of Final Arguments : 23.07.2025
Date of Judgment : 23.07.2025
Decision : Decreed
Judgment
1. This suit is filed by plaintiff for recovery of Rs.4,05,836/- with 18% interest as
unpaid dues of goods sold.
Case of the Plaintiff
2. Case of the plaintiff as per amended plaint and the documents filed is that she
is proprietor of M/s SNV Impex Sales at Kishanganj, Delhi and is in the
business of sale and purchase of utensils. Defendant is said to be a
businessman based at Cuttack, Odisha. Both the sides have business relations
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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since 2017. Sales were carried out between 21.09.2017 and 03.07.2018.
Although the plaint is silent but as per ledger the cumulative value of all the
sales carried out through 18 invoices was Rs.5,05,836/-. The ledger carries a
reference that sales were carried out through 19 invoices but an incomplete
table of 18 invoices is mentioned in the plaint. One invoice dated 24.04.2018
for Rs.30,800/- visible in ledger do not find mention in the table of invoices
reproduced in para 6 of the amended plaint.
3. Defendant did not clear the dues despite repeated demands. All that is pleaded
is that there was a debit balance of Rs.4,05,836/- as on 08.05.2018 when the
last payment of Rs. 1 lakh was paid by the defendant. Plaintiff was constrained
to issue legal demand notice on 30.12.2022 which was neither replied nor
complied. Plaintiff has sought 18% interest but no reason has been cited in the
pliant. The plaint is absolutely non-compliant of Order 7 Rule 2A of CPC as
amended for Commercial Courts. Plaintiff has calculated pre-suit interest of
Rs.2,85,153/- taking the total to Rs.6,90,989/-. It is pleaded that defendant has
issued two cheques of Rs.30,000/- each as on 18.01.2021 and 22.01.2021 but
they were dishonoured on presentation. The plaint is silent if any NI Act case
was filed by the plaintiff or not. The plaint is silent if the copy of dishonoured
cheques have been placed on record alongwith purported dishonoured memos.
The plaint is also silent if the plaintiff filed any Section 138 NI Act, 1881
complaint against the defendant. Despite the fact that these 2 cheques were not
filed on record but still they have been cited as the reason as to why the suit is
within limitation. In this backdrop, the suit in hand is filed for following
reliefs:
Prayer:
i. A decree for a sum of Rs.6,90,989/- (Rupees Sixty Lacs Ninety Thousand and Nine
Hundred and Eighty-Nine) in favour of the plaintiff thereby directing the defendant to
pay said sum to the plaintiff;
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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ii. Orders to be passed pendente lite and future interest @ 18% from the date of filing of
the suit till the amount is actually realized;
iii. Cost of the present suit may be awarded to plaintiff
iv. Pass any other and such order, as this Hon'ble Court may deem fit and proper in the
facts and circumstances of the present case and in the interest of justice.
4. Summons of the suit was served upon the defendant by Ld. Predecessor
defendant refused to receive sumon on 27.08.2024 and was deemed served. No
WS was filed within 30 days or thereafter, right of defendant to file WS was
closed.
5. Upon completion of pleadings following notional issues were identified by Ld.
this Court on 10.12.2024:
Notional Issues:
i. Whether plaintiff is entitled to recovery of Rs.4,05,836/- alongwith interest @ 18%
per annum? OPP
ii. Relief.
6. To prove his case plaintiff examined its Proprietor as PW-1 Madhu Gupta.
Vide affidavit Ex.PW1/A, she deposed on the line of plaint and exhibited
following documents:
i. Copy of Registration Certificate of Proprietorship is Ex.PW1/1.
ii. Copy of ledger account is Ex.PW1/2.
iii. Copy of original legal notice dated 30.12.2022 is Ex.PW1/3.
iv. Original postal receipt dated 31.12.2023 is Ex.PW1/4.
v. Original delivery report dated 04.01.2023 is Ex.PW1/5.
vi. Original Non-Starter Report is Ex.PW1/6.
vii. E-printouts of invoice page 1 to 19 is Ex.PW1/7 (Colly.).
viii.Certificate under Order 11 Rule 6 (3) CPC is Ex.PW1/8.
7. None appeared on behalf of defendant for cross-examining PW1.
8. I have heard arguments of Ms. Daizy Sharma, Ld. Counsel for plaintiff
arguing under written authority given by her Senior i.e. Sh. Kamal Anand,
Advocate. None appeared for arguing the case on behalf of the defendant. I
have perused the case file carefully.
9. Now I shall dispose off the Notional Issue framed in this case.
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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Issue No. 1:
i. Whether plaintiff is entitled to recovery of Rs.4,05,836/- alongwith interest @ 18%
per annum? OPP
Limitation for filing the suit
10.Before embarking on discussing the case of the plaintiff on merits, in so far as
the 19 invoices agitated in the suit were issued between 31.07.2017 and
03.07.2018 while the suit in hand was filed on 13.03.2024, the suit filed after
6-7 years of sales ex-facie appears to be barred by limitation as per Section 3
of Indian Limitation Act, 1963.
11.At the onset Ld. Counsel for plaintiff is invited to make submissions on the
aspect of limitation in so far as the sale was carried out through 19 invoices
between 21.09.2017 and 03.07.2018 while the suit has been filed in 2024. Even
if the limitation is calculated from last invoice i.e. w.e.f. 03.07.2018, before the
Covid-19 pandemic related freeze was put in place by Hon'ble Supreme Court
on 15.03.2020, a period of 1 year, 8 months and 12 days had elapsed. The
freeze was lifted w.e.f. 01.03.2022 and as such as on that date plaintiff had 1
year, 3 months 19 days left with him.
12.In case of in Re: Cognizance For Extension of Limitation" Suo Motu Writ
Petition (C) No.3 of 2020" in cognizance of extension of limitation dated
10.01.2022 the limitation was freezed by Hon'ble Supreme Court from
15.03.2020 to 28.02.2022. Hon'ble Supreme Court held that
"5. Taking into consideration the arguments advanced by learned counsel and the impact of the
surge of the virus on public health and adversities faced by litigants in the prevailing
conditions, we deem it appropriate to dispose of the M.A. No. 21 of 2022 with the following
directions:
I. The order dated 23.03.2020 is restored and in continuation of the subsequent orders
dated 08.03.2021, 27.04.2021 and 23.09.2021, it is directed that the period from
15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may
be prescribed under any general or special laws in respect of all judicial or quasi
judicial proceedings.
II. Consequently, the balance period of limitation remaining as on 03.10.2021, if any, shall
become available with effect from 01.03.2022.
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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III. In cases where the limitation would have expired during the period between 15.03.2020
till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all
persons shall have a limitation period of 90 days from 01.03.2022. In the event the
actual balance period of limitation remaining, with effect from 01.03.2022 is greater
than 90 days, that longer period shall apply.
IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand
excluded in computing the periods prescribed under Sections 23 (4) and 29A of the
Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act,
2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881
and any other laws, which prescribe period(s) of limitation for instituting proceedings,
outer limits (within which the court or tribunal can condone delay) and termination of
proceedings."
(Emphasis Supplied)
13.In case titled Arif Azim Co. Ltd. Vs. Aptech Ltd., 2024 Latest Caselaw 128
SC Hon'ble Supreme Court ruled that,
"82. Thus, in ordinary circumstances, the limitation period available to the petitioner
for raising a claim would have come to an end after an expiry of three years, that is, on
27.03.2021. However, in March 2020, the entire world was taken under the grip of the
deadly Covid-19 pandemic bringing everyday life and commercial activity to a
complete halt across the globe. Taking cognisance of this unfortunate turn of events,
this Court vide order dated 23.03.2020 passed in Suo Motu Civil Writ Petition No.
03/2020 directed the period commencing from 15.03.2020 to be excluded for the
purposes of computation of limitation.
The said extension of limitation was extended from time to time by this Court in view of
the continuing pandemic. As a result, the period from 15.03.2020 to 28.02.2022 was
finally determined to be excluded for the computation of limitation. It was provided that
the balance period of limitation as available on 15.03.2020 would become available
from 01.03.2022. Operative part of the order dated 10.01.2022 is extracted
hereinbelow:...............
84. The effect of the above-referred order of this Court in the facts of the present case is
that the balance limitation left on 15.03.2020 would become available w.e.f.
01.03.2022. The balance period of limitation remaining on 15.03.2020 can be
calculated by computing the number of days between 15.03.2020 and 27.03.2021,
which is the day when the limitation period would have come to an end under ordinary
circumstances. The balance period thus comes to 1 year 13 days. This period of 1 year
13 days becomes available to the petitioner from 01.03.2022, thereby meaning that the
limitation period available to the petitioner for invoking arbitration proceedings would
have come to an end on 13.03.2023."
14.This judgment has been followed by Hon'ble High Court in a recent judgment
passed on 01.05.2024 in case titled Chroma-Ator Energy Systems Pvt. Ltd.
Vs. Indraprastha Gas Ltd., 2024 Latest Caselaw 869 Del wherein in an
arbitration matter notice under Section 21 of Arbitration Act was issued on
04.11.2022 while petition under Section 11 (6) of the Act was filed on
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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01.03.2024. While referring to the above judgment of Arif Azim Vs. Aptech
Ltd. Hon'ble High Court ruled,
"11. Applying the interpretation set out above, since limitation in this case expired on 7 th
November 2021, firstly, the period of limitation between 15 th March 2020 and 7th
November, 2021 would stand excluded. The recommencement of the limitation period
would be from Ist March, 2022.
12. Thus, the invocation of arbitration on 4th November 2022, would not be barred by
limitation, rendering the present arbitration petition under Section 11(6) of the Act to be
within limitation period under Article 137 of the Limitation Act, 1963."
15.Suit is hit by Section 3 of Limitation Act, 1963 and it is evidently barred by
limitation. For ready reference the relevant text is reproduced hereunder:
Section 3 Limitation Act, 1963 : Bar of Limitation
i. Subject to the provisions contained in sections 4 to 24 (inclusive) every suit instituted, appeal
preferred, and application made after the prescribed period shall be dismissed although
limitation has not been set up as defense;
16.In case titled V.M. Salgaocar and Bros. v. Board of Trustees of Port of
Mormugao and Another, 2005 Latest Caselaw 207 SC wherein Hon'ble
Supreme Court held as follows:
"20. The mandate of Section 3 of the Limitation Act is that it is the duty of the court to
dismiss any suit instituted after the prescribed period of limitation irrespective of the fact
that limitation has not been set up as a defence. If a suit is ex facie barred by the law of
limitation, a court has no choice but to dismiss the same even if the defendant intentionally
has not raised the plea of limitation.
17.In case titled Manindra Land & Building Corpn. Ltd. v. Bhutnath
Banerjee, 1963 Latest Caselaw 153 SC Hon'ble Supreme Court held:
9."Section 3 of the Limitation Act enjoins a court to dismiss any suit instituted, appeal
preferred and application made, after the period of limitation prescribed therefore by
Schedule I irrespective of the fact whether the opponent had set up the plea of limitation
or not. It is the duty of the court not to proceed with the application if it is made beyond
the period of limitation prescribed. The Court had no choice and if in construing the
necessary provision of the Limitation Act or in determining which provision of the
Limitation Act applies, the subordinate court comes to an erroneous decision, it is open to
the court in revision to interfere with that conclusion as that conclusion led the court to
assume or not to assume the jurisdiction to proceed with the determination of that
matter."
(Emphasis Supplied)
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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18.Accordingly the three years period after setting off the freeze of limitation
expired on 19.06.2023. Plaintiff is shown to have spent time before Central
DLSA for Pre-Institution Mediation between 28.03.2023 and 04.07.2023. By
applying the proviso to Section 12A whereby plaintiff is entitled to set off of
this period i.e. 3 months 7 days the last date of filing the suit comes to
26.09.2023 whereas the suit was filed on 13.03.2024 i.e. after more than 6
months of expiry of 3 years period. In so far as no credit period is provided in
the invoices and nothing has been filed on record to show date of delivery, no
extension of limitation on this score is possible.
Two Cheques not filed on record
19. Ld. counsel for plaintiff submits that the period of limitation may be calculated
on the basis of the date of the 2 dishonoured cheques which were dated
18.01.2021 and 22.01.2021. Surprisingly, neither the original nor any
photocopy of these two cheques or any dishonoured memo have been filed by
the plaintiff on record. In the absence of any documentary proof of drawing of
any cheque by the defendant in favour of plaintiff, this Court cannot presume
that the defendant did actually issue two cheques as claimed. Even otherwise
these two cheques cannot have the strength to extend the limitation of entire
unpaid amount of Rs.4,05,836/- in terms of judgement of Division Bench of
Hon'ble High Court of Delhi in case titled Manish Garg Vs. East India
Udyog Limited, 2001 Latest Caselaw 2022 Del dated 30.03.2001 decided by
Division Bench led by HMJ A.K. Sikri and HMJ Arun Kumar in RFA
decided on 30.03.2001.
20. The law with regard to limitation is covered under Article 1, Article 14 & 15
of Schedule attached to Limitation Act, 1963. For ready reference the same
are reproduced hereunder:
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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Schedules to Limitation Act
Article Description of suit Period of Time from which period begins to
limitation run
1. For the balance due on a mutual, open and Three Years The close of the year in which the
current account, where there have been last item admitted or proved is
reciprocal demands between the parties entered in the account; such year to
be computed as in the account
14. For the price of goods sold and delivered, Three years The date of the delivery of the
where no fixed period of credit is agreed goods.
upon
15. For the price of goods sold and delivered to Three years When the period of credit expires.
be paid for after the expiry of a fixed period
of credit
21. Once the plaintiff's case is found to be not covered under Article 1, it should
by necessary legal implication fall under Article 14 & 15 where under the
three years period of limitation starts from the date of delivery of goods under
Article 14 and starts from the date after expiry of initial Bill payment credit
period under Article 15. Law in this regard is well settled by landmark
judgment of Hon'ble Diovision Bench of High Court of Delhi in case title
"Manish Garg Vs. East India Udyog Limited" decided by Division Bench
led by HMJ A.K. Sikri and HMJ Arun Kumar in RFA decided on
30.03.2001. In this case, an appeal was filed against the Order of Ld. ADJ,
wherein plaintiff's suit claim for Rs. 4 lacs against the unpaid dues of goods
sold / supplied was partly dismissed by referring the bills to be time barred and
only a decree of Rs. 36,404/- was passed. For better understanding of facts, it
would be appropriate to quote Para 2 of the judgement.
"2.The plaintiff had filed the suit for recovery of amount against supply of goods in
respect of various other bills as well. However, the learned Additional District Judge
by impugned judgment and decree held that the claim in respect of these bills, which
were prior in time to the aforesaid bills, was time barred and thus rejected / rest of
the claims and decreed the claim in respect of the aforesaid bills only which were
found to be within limitation. The plaintiff has filed this appeal challenging the
finding of the Trial Court holding rest of the claims as time barred."
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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22. In the Manish Garg Case, the plaintiff had filed suit qua recovery of sales made
with effect from 12.02.1994 onwards and the suit was filed on 15.02.1999.
There was an agreement of 60 days credit period between the parties which
attracted Article 15 of Limitation Act, 1963. Upon calculating the three years
period back from the date of filing of the suit i.e. 15.02.1999, it was found that
only five bills were found to be within the limitation. This can be understood
as per the Para 3 of the judgement of Hon'ble Division Bench as under:
"3.The plaintiff had filed statement of account (Exhibit Public Witness 1/56). It starts
from 12/02/1994 and gives the details of various bills raised from time to time when the
material was supplied to the defendant. It also mentions various payments made by the
defendant to the plaintiff, credit of which has been given in the statement of account.
Suit for recovery was filed on 15.02.1999. Article 14 of the Limitation Act prescribes
limitation for a suit filed for particulars of goods sold and delivered. Period of
limitation is three years which is to be determined from the date of delivery of goods.
However, as per the agreement between the parties, 60 days credit was to be given to
the defendant for making payment. Under, article 15 of the Limitation Act, the
limitation starts from the date of expiry of fixed period of credit. On this reckoning by
counting the period of limitation of three years backward from 15.02.1999 when the
suit was filed, the trial Court held that claim in respect of aforementioned five bills only
was within limitation."
23. The Division Bench led by HMJ Sh. A.K. Sikri discussed the contentions
raised by the plaintiff before the Trial Court in Para 4, as under:
Before us, in this appeal, the Ld. Counsel for plaintiff/appellant limited his
argument to the aforesaid aspect. The Ld. Counsel submitted that various payments made
by the defendants would show that those payments were made on account inasmuch as
there were certain payments in round figures and even odd figure payments did not tally
with the amount mentioned in the bills from which it could clearly be inferred that
payment did not relate to any specific bill but were on account. We had summoned the
record and perused the statement of account (Exb. Public Witness 1/56) the genuineness of
which is not in doubt. The perusal of the statement of account confirms the truthfulness
of the stand taken by the plaintiff/appellant. Therefore, to this extent there cannot be any
dispute viz. That payment made by the defendant to the plaintiff were not in respect of
specific bills/supplies and could be treated as payment made on account.
24. Having concluded that the cited case is not covered under Article 1, the Bench
concluded that case is covered under Article 15 in so far as there was 60 days
credit period contract between the parties. In such a situation, the Bench ruled
that as and when the buyer makes lumpsum payments on account and does not
pay bill wise, the seller like the plaintiff in cited case as well as in case in the
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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hand has a right to adjust it against the oldest unpaid bill. Section 60 of Indian
Contract Act, 1872 is very clear in this regard, same is reproduced
hereinunder:
"60. Application of payment where debt to be discharged is not indicated- Where the
debtor has omitted to intimate, and there are no other circumstances indicating to
which debt the payment is to be applied, the creditor may apply it at his discretion to
any lawful debt actually due and payable to him from the debtor, whether its recovery
is or is not barred by the law in force for the time being as to the limitations of suits."
25. Plain reading of this statute shows that as and when in cases where payments
are received without any indication or rider from the debtor then the creditor
discretion to apply it against any lawful debt due and payable. The statue
further provides that such payments can be adjusted even against the dues
which are barred by limitation.
26. While concluding that the Hon'ble Division Bench led by Justice A.K. Sikri
concluded that once a case is not covered in Article 1 then it covers under
Article 14 and 15 and payments made in account can be adjusted against the
oldest bill. This conclusion is arrived at Para 9. For ready reference the same is
reproduced hereinunder;
"9.Thus, applying the aforesaid principles, it clear that in the instant case account
in question was not mutual, open and current account not was it a case reciprocal
demands. The learned Trial Court was therefore right in holding that Article 1 of
the Limitation Act did not apply. In fact in such a case payment was made by the
defendant from time, as per, Section 60 of the Indian Contract Act, it was open
to the plaintiff to adjust the payment received against any of the bill at his
discretion. Therefore, in order to save limitation the plaintiff could adjust the
payment made against the oldest bills. But Section 60 of the Contract Act would
not extend limitation period."
(Emphasis supplied)
27.As such in the light of the above salutory judgment of Division Bench of
Hon'ble High Court of Delhi part payments made on account by the seller to
the buyer, in such like cases, would not lead to acknowledgement of debt
resulting in extension of limitation as provided under Section 18 and Section
19 of Limitation Act, 1963.
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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No proof of Delivery of Goods
28.Admittedly, this suit was initially filed solely on the basis of ledger and legal
demand notice. Invoices were allowed to be filed by this Court subsequently
on plaintiff's application under Order 11 Rule 1 (5) CPC which was allowed
subject to cost of Rs.9,500/-. Even at that juncture the plaintiff did not avail the
opportunity for filing on record the two cheques and corresponding e-way
bill/bilty to discharge under Section 31, 33 and 39 of Sale of Goods Act,
1930. Also no evidence was led by the plaintiff to seek benefit under Section
16 (2) of CGST Act, 2017 by claiming and establishing that the defendant
availed Input Tax Credit as per Section 2 (63) of CGST Act, 2017.
29.In the light of the above plaintiff has miserably failed to either show that the
suit is within limitation or that plaintiff is entitled to a decree for recovery of
suit amount against the defendant. The notional issue is accordingly
answered against the plaintiff and in favoour of defendant.
30. In view of the above, suit is dismissed being hopelessly barred by
limitation.
31. Hon'ble Supreme Court has come down heavily on such vexatious litigations
indulging in false pleadings and clever drafting so as to misguide the Courts to
extract reliefs in the following judgments:
32. In case titled C.B. Aggarwal Vs. P. Krishna Kapoor, 1994 Latest Caselaw
764 Del Hon'ble Delhi High Court observed:
"It is true that in a civilised society, legal process is the machinery for keeping order and doing
justice. It can be used properly or it can be abused. It is used properly when it is invoked for
vindication for men's right and enforcement of just claims. It is abused when it is diverted from
its true course so as to serve extortion or oppression; or to exert pressure so as to achieve an
improper end."
In case titled Curtis-Raleighquoted in Jennison v. Baker (1972) 1 All ER 997 at p. 1006. it is
said "The law should not be seen to sit by limply, while those who defy it go free, and those
who seek its protection lose hope"
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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33. In case titled Goyal MG Gases Pvt. Ltd. Vs. AIR Liquide Deutschland th
Gmbh & Ors., 2006 Latest Caselaw 1866 Del Hon'ble Delhi High Court held
that:
"Vexatious and frivolous litigation poses a number of threats to the efficient operation
of any civil justice system. Those threats stem from the manner in which the vexatious
and frivolous litigant conducts litigation before the courts. Such proceedings, apart, from
the oppression and the harassment inflicted on the adversary, are extremely damaging to
public interest. Judicial resources are valuable and scarce. The resources of the court
are not infinite, especially in terms of judicial time. Therefore, administration of justice
and interests of equity and fair play mandate that a party which succeeds is compensated
by award of costs in respect of false or vexatious claims or defences. A faulting party may
be required to pay to the other party such costs as would, in the opinion of the court, be
reasonably sufficient to reimburse the other party in respect of the expenses incurred by
him in attending the court on that date and payment of such costs on the next date
following the date of such order if unreasonable adjournments are taken by the parties.
However, many unscrupulous parties take advantage of the fact that either costs are not
awarded or nominal costs alone are awarded against the unsuccessful party.
The legislature has recognised the need for imposition of costs and consequently, so far as
the civil proceedings are concerned, has enacted Section 35 of the Code of Civil
Procedure which provides for imposition of costs. The Apex Court was concerned with
the manner in which the costs are imposed resulting in undue advantage being taken by
parties of the fact that notional costs are awarded which do not deter or discourage
persons from filing vexatious or frivolous claims or defences. ................ The courts have
recognised the inherent power of the court to award costs in the interest of
justice. .................................... In this background, there is yet another more imperative
reason which necessitates imposition of costs. The resources of the court which includes
precious judicial time are scarce and already badly stretched. Valuable court time which
is required to be engaged in adjudication of serious judicial action, is expended on
frivolous and vexatious litigation which is misconceived and is an abuse of the process of
law. A judicial system has barely sufficient resources to afford justice without
unreasonable delay to those having genuine grievances. Therefore, increasingly, the
courts have held that such totally unjustified use of judicial time has to be curbed and the
party so wasting precious judicial resources, must be required to compensate."
34. In Jagmal Singh Vs. Delhi Transport Corporation, 1995 Latest Caselaw
572 Del, Delhi High Court observed thus:-
"We are firmly of the view that petitioner has resorted to the dilatory tactics hereby
crippling the progress of the departmental enquiry pending against him for the last
about eight long years. It is not only unfortunate but matter of concern to all of us being
the members of the society, that the petitioner by indulging in this type of frivolous
litigation has not only wasted his time and money but has also wasted the time of the
court and other public functionaries thereby causing unnecessary drain on the
resources of public exchequer whose coffers are filled in by poor people's money. In
such a case with a view to discourage frivolous litigation, it becomes our duty not only
to see that the petitioner is saddled with exemplary costs but also to ensure that he
gets no benefit on account of the delay caused by him in the departmental enquiry
pending against him."
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
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35. In Vinod Seth Vs. Devinder Bajaj, 2010 Latest Caselaw 435 SC it was ruled
that the provision for costs is intended to achieve the following goals:
"It should act as a deterrent to vexatious, frivolous and speculative litigations or
defenses. The specter of being made liable to pay actual costs should be such, as to
make every litigant think twice before putting forth a vexatious, frivolous or speculative
claim or defense.
Costs should ensure that the provisions of the Code, Evidence Act and other
laws governing procedure are scrupulously and strictly complied with and that parties
do not adopt delaying tactics or mislead the Court.
Costs should provide adequate indemnity to the successful litigant to adopt
alternative dispute resolution processes and arrive at a settlement before the trial
commences in most of the cases. In many other jurisdictions, in view of the existence of
appropriate and adequate provisions for costs, the litigants are persuaded to settle
nearly 90% of the civil suits before they come up to trial.
The provisions relating to costs should not, however, obstruct access to courts
and justice. Under no circumstances, the costs should be a deterrent, to a citizen with a
genuine or bonafide claim, or to any person belonging to the weaker sections whose
rights have been affected, from approaching the courts. At present these goals are
sought to be achieved mainly by Section 35, 35A and 35B read with the relevant civil
rules of practice relating to taxing of costs.
That Section 35B CPC providing for costs for causing delay is seldom invoked
and that it should be regularly employed to reduce delay.
36. A classic case where Hon'ble Supreme Court, in an extremely well-articulated
Judgment dwelled on the need for curbing unscrupulous litigation is
Ramrameshwari Devi & Ors. Vs. Nirmala Devi & Ors., 2011 Latest
Caselaw 444 SC where it was inter-alia observed as under:
34. "According to Dr. Mohan, in our legal system, uncalled for litigation gets
encouragement because our courts do not impose realistic costs. The parties raise
unwarranted claims and defences and also adopt obstructionist and delaying tactics
because the courts do not impose actual or realistic costs. Ordinarily, the successful
party usually remains uncompensated in our courts and that operates as the main
motivating factor for unscrupulous litigants. Unless the courts, by appropriate orders or
directions remove the cause for motivation or the incentives, uncalled for litigation will
continue to accrue, and there will be expansion and obstruction of the litigation. Court
time and resources will be consumed and justice will be both delayed and denied........
45.We are clearly of the view that unless we ensure that wrong- doers are denied profit
or undue benefit from the frivolous litigation, it would be difficult to control frivolous and
uncalled for litigations. In order to curb uncalled for and frivolous litigation, the
Courts have to ensure that there is no incentive or motive for uncalled for litigation. It
is a matter of common experience that Courts otherwise scarce and valuable time is
consumed or more appropriately wasted in a large number of uncalled for cases.
54. While imposing costs we have to take into consideration pragmatic realities and be
realistic what the defendants or the respondents had to actually incur in contesting the
litigation before different courts. We have to also broadly take into consideration the
prevalent fee structure of the lawyers and other miscellaneous expenses which have to be
incurred towards drafting and filing of the counter affidavit, miscellaneous charges
towards typing, photocopying, court fee etc.
CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
Page 13
55. The other factor which should not be forgotten while imposing costs is for how long
the defendants or respondents were compelled to contest and defend the litigation in
various courts. The appellants in the instant case have harassed the respondents to the
hilt for four decades in a totally frivolous and dishonest litigation in various courts. The
appellants have also wasted judicial time of the various courts for the last 40 years.
56. These appeals are consequently dismissed with costs, which we quantify as
Rs.2,00,000/-. We are imposing the costs not out of anguish but by following the
fundamental principle that wrongdoers should not get benefit out of frivolous
litigation.
Though the Court has expressed that it is imposing cost not out of anguish, yet the
observations as highlighted above clearly portray the miserable state of affairs and
courts distress on the situation of mounting frivolous litigations.
37.In so far as plaintiff has wasted precious judicial time of this Court for more
than one and a half years by filing a time-barred suit without any evidence,
cost of Rs.25,000/- is imposed upon the plaintiff to be deposited with
Advocates’ Welfare Fund, Delhi Bar Association.
38.Decree sheet be prepared accordingly. File be consigned to Record Room after
due compliance. Digitally
signed by
SURINDER
SURINDER S RATHI
S RATHI Date:
2025.07.25
15:53:09
+0530(SURINDER S. RATHI)
District Judge,
Commercial Court -11
Central District, THC
Delhi/23.07.2025CS Comm. No.355/2024 Madhu Gupta Vs. M/s Mani Plastic Store
Page 14