SC:Salutary principles of CPC shall apply to Industrial Dispute proceedings

The Hon’ble Supreme Court, on 12th September 2019, in the matter of General Manager, Electrical Rengali Hydro Electric Project, Orissa And Others v. Sri Giridhari Sahu And Others pronounced that the law as to pleadings will apply to proceedings under the Industrial Disputes Act but without its full vigor. While the provisions of the CPC may not apply the salutary principles embodied would apply.

The Hon’ble Supreme Court observed that:

In a civil suit, if the plaintiff alleges fraud, misrepresentation or undue influence, he is obliged to give particulars. An allegation of fraud is a matter of a grave nature. So is the allegation of undue influence and misrepresentation. (Para 39)

The intention underlying Order VI Rule 4 of the CPC is that the opposite party is to be put on sufficient notice as to the case which he is called upon to meet. The law loathes, parties to the lis being taken by surprise resulting in the violation of the basic principle of justice that a party should be able to effectively meet the case set up against him. (Para 39)

A perusal of the definition of the word “fraud”, as defined in Section 17 of the Contract Act, would reveal that the concept of fraud is very wide. It includes any suggestion, as a fact, of that which is not true, by a person who does or does not believe it to be true. It may be contrasted with Section 18(1) of the Contract Act which, inter alia, defines “misrepresentation”. It provides that it is misrepresentation if a positive assertion is made by a person of that which is not true in a manner which is not warranted by the information which he has. This is despite the fact that he may believe it to be true. (Para 44)

In fraud, the person who makes an untruthful suggestion, does not himself believe it to be true. He knows it to be not true, yet he makes a suggestion of the fact as if it were true. In misrepresentation, on the other hand, the person making misrepresentation believes it to be true. But the law declares it to be misrepresentation on the basis of information which he had and what he believed to be true was not true. Therefore, the representation made by him becomes a misrepresentation as it is a statement which is found to be untrue. (Para 44)

Fraud is committed if a person actively conceals a fact, who either knows about the fact or believes in the existence of the fact. The concealment must be active. (Para 44)

A person may make a promise without having any intention to perform it. It is fraud. The law further declares that any other act fitted to deceive, is fraud. So also, any act or omission, which the law declares to be fraudulent, amounts to fraud.(Para 44)

Running as a golden trend however and as a requirement of law through the various limbs of Section 17 of the Contract Act, is the element of deceit. A person who stands accused of fraud be it in a civil or criminal action, must entertain an intention to commit deception. Deception can embrace various forms and it is a matter to be judged on the facts of each case. It is, apparently, on account of these serious circumstances that fraud has on a legal relationship or a purported legal relationship that the particulars and details of fraud is required if pleaded in a civil suit or a proceeding to which the CPC applies. (Para 44)

An application under Section 33A of the Industrial Disputes Act, 1947 is not a civil suit. (Para 46)

The provisions of Order VI Rule 4 of the CPC, as such, is not applicable to proceedings under the Industrial Disputes Act. (Para 46)

The law as to pleadings will apply to proceedings under the Industrial Disputes Act but without its full vigor.While the provisions of the CPC may not apply the salutary principles embodied would apply. This is for the reason that the purpose of pleading, be it in a civil suit or other proceeding, is to allow the opposite party to meet the case of his opponent to ready the evidence to be adduced and marshal the law in support of its case.(Para 46)

Copy of judgment: Judgement_12th-Sep-2019

-Adv. Tushar Kaushik

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