Introduction:This case pertains to the failure of the defendant to file an affidavit of admission and denial of documents as per procedural requirements. The main legal question before the Delhi High Court was whether such a failure should be treated as a situation under Order VIII Rule 10 of the Code of Civil Procedure, 1908 (CPC) or if it merely results in the documents being deemed admitted while the written statement is still considered.

Filing of Suit: The plaintiff, Unilin Beheer B.V., filed CS(COMM) No. 1683/2016 seeking a permanent injunction restraining infringement of Patent No. 193247 and related reliefs. However, the patent validity lapsed during the proceedings, rendering the permanent injunction moot. The suit was then pursued only for damages.

Counter Claim & Revocation Proceedings:The defendant, Balaji Action Buildwell, contested the suit and was granted liberty (order dated 29th January 2018) to file a Counter Claim for revocation of the subject patent if it withdrew the pending rectification proceedings under Section 64 of the Patents Act, 1970 before the Intellectual Property Appellate Board (IPAB).The defendant filed the Counter Claim with an advance copy to the plaintiff’s counsel on 23rd February 2018 and re-filed on 30th July 2018.

Procedural Delays & Non-compliance:The plaintiff filed the written statement to the Counter Claim on 19th April 2018, but the acknowledgment of receipt by the defendant’s counsel was on 2nd May 2018.The written statement was re-filed after objections on 2nd May 2018 and 10th October 2018.The defendant filed IA No. 10200/2018 under Order VIII Rule 10 CPC, seeking:Rejection of the plaintiff’s written statement to the Counter Claim.Deeming all documents filed by the defendant as admitted.Allowing the Counter Claim forthwith.

Plaintiff’s Submissions (Unilin Beheer B.V.):The delay in filing the written statement and affidavit of admission/denial of documents should be excused under Rule 14 of Chapter I of Delhi High Court (Original Side) Rules, 2018, which allows courts to dispense with compliance in exceptional cases.The affidavit requirement (Rule 3 of Chapter VII) was introduced only on 1st March 2018, and the plaintiff was not fully aware of the consequences of non-filing. Since the defendant filed a replication to the written statement, it had implicitly condoned the delay. The plaintiff had, in its written statement, dealt with the defendant’s documents, so an affidavit was not strictly necessary.

Defendant’s Submissions (Balaji Action Buildwell):The written statement was not filed within 30 days and was beyond the maximum 120-day period, making it inadmissible as per SCG Contracts India Pvt. Ltd. vs. K.S. Chamankar Infrastructure Pvt. Ltd. (2019 SC). Without an affidavit of admission/denial, the written statement cannot be taken on record as per Rule 3 of Chapter VII. The plaintiff’s reliance on Rule 14 (power to dispense with compliance) was misplaced, as it cannot override a mandatory rule.

Key Legal Provisions Considered:Order VIII Rule 10 CPC – Deals with consequences of non-filing of a written statement.Order XI Rule 4 CPC (as applicable to Commercial Courts Act, 2015) – Mandates an affidavit of admission/denial of documents. Delhi High Court (Original Side) Rules, 2018: Rule 3 of Chapter VII – Requires an affidavit of admission/denial to accompany the written statement.Rule 4 of Chapter VII – States that failure to file such an affidavit results in the documents being deemed admitted.Rule 14 of Chapter I – Grants discretion to the court to dispense with procedural requirements in certain cases.

Citations & Their Context: SCG Contracts India Pvt. Ltd. vs. K.S. Chamankar Infrastructure Pvt. Ltd. (2019 SC)Established that strict timelines for filing pleadings in commercial suits must be adhered to.

Defendant relied on this case to argue that time limits could not be extended beyond the statutory period.Xerox Corporation vs. P.K. Khansaheb (2018 Del HC)Affirmed the mandatory nature of procedural rules in commercial suits.Used to counter the plaintiff’s request for exemption under Rule 14 of Chapter I.

Reasoning of the Judge: Affidavit of admission/denial is mandatory – The court held that without an affidavit, the written statement cannot be taken on record. Non-filing has serious consequences – The court interpreted Rule 3 and Rule 4 of Chapter VII together, concluding that failure to file an affidavit results in:Written statement not being taken on record.Documents being deemed admitted.The court proceeding under Order VIII Rule 10 CPC, which allows judgment based on admissions.Legislative intent must be upheld – The rules were designed to prevent delays and ensure efficient case management. Allowing a lenient approach would defeat the purpose of the Commercial Courts Act, 2015.

Balancing procedural strictness with fairness: Despite the strict interpretation, the judge considered the facts and held that: Since the written statement was re-filed within the maximum 120-day limit, it could still be taken on record. However, this would be subject to costs of Rs. 3 lacs to be paid to the defendant’s counsel.

Decision: The written statement was allowed to be taken on record, but the plaintiff was directed to pay costs of Rs. 3 lacs. The applications were disposed of with the following orders: Written statement and affidavit of admission/denial to be accepted. Counter Claim to proceed with framing of issues on 13th August 2019.

Concluding Note:This case reinforces the strict procedural requirements in commercial suits under the Commercial Courts Act, 2015 and the Delhi High Court (Original Side) Rules, 2018. The judgment strikes a balance between enforcing procedural compliance and preventing undue prejudice to parties due to technical defaults. It serves as a precedent on the consequences of failing to file an affidavit of admission/denial and the judicial discretion available under Rule 14 of Chapter I.

Date of Order: 9th April 2019 

Case No.: CS(COMM) 1683/2016 & CC(COMM) 38/2018

Court: Delhi High Court

Judge: Hon’ble Mr. Justice Rajiv Sahai Endlaw

High Court of Delhi

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