Institute of Legal and Management Studies

Holding that a counter-claim under Order VIII Rule 6-A CPC can be filed only against the plaintiff, the Supreme Court set aside the Calcutta High Court's decision that allowed one defendant to file a counter-claim against a co-defendant.

A bench of Justice PS Narasimha and Justice Joymalya Bagchi ruled in favor of the plaintiff, who appealed against the High Court's decision to allow filing of counter-claim between co-defendants, stressing that filing of counter-claim between co-defendant is impermissible.

The appellant instituted a suit seeking a declaration and injunction against her sister-in-law (defendant no.1), challenging an agreement to sell dated 21 October 2011 that had been executed in favour of respondent no.1 (defendant no.2). During the pendency of the proceedings, defendant no.1 passed away, and pursuant to a consent order of the Gujarat High Court, the Nazir of the City Civil Court, Ahmedabad, was substituted in her place.

Years later, in July 2021, defendant no.2 sought to amend his written statement and introduce a counter-claim. Through this counter-claim, he prayed for specific performance of the 2011 agreement to sell against the Nazir, who was representing the estate of the deceased defendant no.1, and also sought partition of the suit property.

The Trial Court, by its order in August 2021, dismissed the application on the grounds of delay, limitation under Article 54 of the Limitation Act, and the well-settled principle that counter-claims cannot be directed solely against co-defendants. However, in January 2023, the Gujarat High Court, exercising its supervisory jurisdiction under Article 227 of the Constitution, overturned the trial court's order and permitted the counter-claim, reasoning that it became maintainable after the appointment of the Nazir. Aggrieved by this decision, the plaintiff-appellant approached the Supreme Court.

Disagreeing with the High Court's decision, the judgment authored by Justice Narasimha, referencing Rohit Singh & Ors. v. State of Bihar, (2006) 12 SCC 734 observed that a counterclaim cannot be made against a co-defendant.

“In the present case, defendant no. 2 sought to raise a counter-claim primarily for the relief of specific performance of agreement dated 21.10.2011 executed in his favour by deceased original defendant no. 1 with respect to her undivided share in the suit property, by a direction to the Nazir, the substituted representative of defendant no. 1, to execute a sale deed in pursuance of the agreement to sell. The relief of specific performance as sought to be raised by defendant no. 2 cannot be set up by way of a counter-claim since the same is not directed against the appellant/plaintiff, but is instead directed solely against the co-defendant. In view of this, defendant no. 2 is held to be disentitled to raise prayer of specific performance by way of counter-claim. This is simply not permissible, and this position is no more res-integra in view of the decision of this Court in Rohit Singh (supra).”, the Court said.

It was observed in Rohit Singh that "a counterclaim directed solely against the co-defendants cannot be maintained."

Another ground on which the Court termed the High Court's decision to be erroneous was of allowing the defendant no.1 to make counter claim against the defendant no.1 after framing of issues. Relying on Ashok Kumar Kalra v. Wing CDR Surendra Agnihotri, (2020) 2 SCC 394, the Court said that a counterclaim must be brought before the framing of issues, and not after the framing of issues stage.

“Only after the death of his vendor in October 2013 and after framing of the issues in February 2019 that the defendant no. 2 decided to file the application- only after nine years of the filing of the suit, which is again two years after framing of the issues.”, the court said.

“we are of the opinion that the High Court committed an error in reversing the judgment of the Trial Court by permitting defendant no. 2 to file a counter-claim against defendant no.1 and not against the plaintiff.”, the court held.

Accordingly, the appeal was allowed.

Cause Title: RAJUL MANOJ SHAH ALIAS RAJESHWARI RASIKLAL SHETH VERSUS KIRANBHAI SHAKRABHAI PATEL & ANR.

Citation : 2025 LiveLaw (SC) 912

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Appearance:

For Petitioner(s) :Mr. Ritin Rai, Sr. Adv. (Arguing Counsel) Mr. Shamik Shirishbhai Sanjanwala, AOR Mr. Kunal Vyas, Adv. Mr. Aditya Tripathi, Adv.

For Respondent(s) :Mr. Pradhuman Gohil, Adv. Mrs. Taruna Singh Gohil, AOR Mr. Alapati Sahithya Krishna, Adv. Mr. Rushabh N. Kapadia, Adv. (Arguing Counsel) Ms. Hetvi Ketan Patel, Adv. Ms. Taniya Bansal, Adv. Mr. Malak Manish Bhatt, AOR