Set-off and Counter Claim in written statement.pptx

written statement

1. Set-off and Counter Claim

2. Set-Off Set-off is related to debts. It is the reciprocal claim made by the defendant. Set-off can be used only under the suit for recovery of money. Set-off is dealt under Order VIII Rule 6, and it says that such written statement along with a set-off should be considered by the Court as much as plaint because it too has a subject matter that is in dispute.

3. Set-Off Essentials of Set-off Defendant has  the right to claim. The plaint must be for the  recovery of debts. The debt amount must be  definite and mentioned. The amount must be of a  recoverable nature. It must be within the  pecuniary limit  of the court. Both the parties must fill the  same character  as mentioned in the plaint.

4. Set-Off Position of Set-off in CPC, 1908 Order VIII Rule 6 of the CPC  states the particulars of the set-off to be given in the written statement. The provision states following ingredients: - The defendant  may submit a written statement  containing the amount as debt to set off at the first hearing of the suit and not afterwards. It will be on the  same footing as a plaint  in a cross-suit. But it will  not affect the lien. Rules for written statement and claim in the form of set-off are same.

5. Set-Off Types of Set-off Legal Set-off Order VIII Rule 6(1) CPC discusses the Legal Set-off. The amount  must be mentioned  for the legal set-off. The amount must be of a  recoverable nature. Defendant  must pay court fees  for the process. The set-off under written statement must be filed  within the period of limitation  prescribed .

6. Equitable Set-off It is present in a  vague manner  under Order 20 Rule 19(3). The doctrine is based on the principle of  ‘Equity, Justice and Good Conscience’. It is governed by the English law. It is a claim for an  unascertained amount  of money. It must arise out of the  same transaction or connected  with the transaction of money claimed in the petition. In the case of  Maharashtra State Farming Corporation Ltd v. Belapur Sugar and Allied Industries Ltd (2004) , it was held that the amount claimed must be out of the same transaction and must not be barred by time in the equitable set-off. It is based on the discretion of the court of law. Defendant may or may not pay the court fees.

7. Counterclaim It is enshrined in Order VIII Rule 6A – 6G of the CPC. The 27th Law Commission Report of 1964 recommended to set-up a right to file counterclaim in the civil procedure a right for the defendant. As an aftermath of the recommendation, CPC (Amendment) Act, 1976 added rules 6B to 6G to the existing act.

8. Concept of Counterclaim It is a claim which is independent in nature or can be separated from the claim of the plaintiff. When the cause of action arises against the plaintiff the defendant gets the right to submit that claim along with the written statement. It is considered as a plaint by the defendant against the claim of the plaintiff and is dealt with in the same manner as a plaint. Furthermore, the plaintiff has an opportunity to file a written statement against the plaint consisting of the counterclaim. The Supreme Court held the right to file a counterclaim a statutory right, in Laxmidas v. Nanabhai (1964) . The Delhi HC in the case of Gastech Process Engineering Pvt. Ltd. v. Saipem (2009) deciphered it as a weapon in the hand of the defendant.

9. Counterclaim Purpose of Counterclaim To stop the multiplicity of suits. To save the time of the court of law. To make the civil procedure convenient for parties. To make the timely trials.

10. Counterclaim When to file a counter-claim? In the case of Ashok Kumar Kalra vs Wing Cdr , Surender Agnihotr , the court allows the filing of a counter-claim under the following circumstances: The counter-claim can be filed before or after the initiation of the lawsuit. It should be filed before the defendant has submitted their written statement. It should be filed before the time limit set for delivering the defendant’s defence expires.

11. Counterclaim Modus of Filing Counterclaim By amending written statement with the leave of the court and setting up counterclaim; By mentioning into the subsequent pleading prescribed under Order 8 Rule 9.

12. Counterclaim Essentials of Filing Counterclaim It must be filed by the defendant. It must for an independent or a claim that is separable in nature. It must be filed against the plaintiff. It can be filed against co-defendants in some scenarios. It must be in respect of any incident that happened before or after the filing of the suit. It cannot be filed at the appellate stage before the appellate authority.

13. Common points between set-off and counter-claim (i) none should exceed the pecuniary limits of the jurisdiction of the Court, ii) both are pleading in written statement, if the law governing the Court permits plea being rised by the defendant in the written statement, ii) the plaintiff is expected to file a written statement in answer to a claim for set-off or to a counter-claim; v) even if permitted to be raised the Court may in appropriate cases direct a set-off or counter-claim being tried separately, v) a defendant cannot be compelled to plead a set-off nor a counter-claim; he may as well maintain an independent action for enforcing the claim forming the subject matter of set-off or counter-claim;

14. The End