Jay Colours Company vs. M/S Surender Kumar Jain

Facts

The petitioner, Jay Colours Company, filed a transfer petition under Section 24 of the Code of Civil Procedure, 1908, seeking to transfer a commercial suit (CS(COMM.) 714/2023) from one Commercial Court to another. The petitioner, who is the defendant in both suits, argued that the suit sought to be transferred and another pending suit (CS(COMM.) 897/2023) involve similar evidence, particularly concerning GST issues. The petitioner contended that both matters were effectively filed by Mr. Surender Kumar Jain for recovery of amounts arising from transactions with the petitioner. The suit CS(COMM.) 714/2023 was filed by Surender Kumar Jain as a proprietor, while CS(COMM.) 897/2023 was filed by VDR Colours and Chemical Pvt. Ltd., a juristic entity, through its managing director. The petitioner is the defendant in both cases.

Held

The Court dismissed the transfer petition. The Court was not convinced by the petitioner's argument that the two suits should be transferred for consolidation. The primary reasoning was based on the differing stages of adjudication of the two suits. CS(COMM.) 714/2023 was at the stage of final arguments, while CS(COMM.) 897/2023 was at the stage of the plaintiff's evidence. Furthermore, the Court noted a distinction in the juristic entities involved: Surender Kumar Jain was the plaintiff as a proprietor in CS(COMM.) 714/2023, whereas VDR Colours, a company, was the plaintiff in CS(COMM.) 897/2023. The Court also observed that these suits related to different transactions, despite involving the same defendant. The ratio decidendi is that mere similarity of issues, particularly GST issues, and the fact that the same defendant is involved in both suits, is insufficient to warrant a transfer under Section 24 of the CPC when the suits are at significantly different procedural stages and involve distinct plaintiffs.

Key Issues

1. Whether CS(COMM.) 714/2023, pending before DJ (Commercial Courts)-04, Central District, Tis Hazari Courts, Delhi, should be transferred to the Court of Sh. M.K. Nagpal DJ (Commercial Courts)-13, Central District, Tis Hazari Courts, where CS(COMM.) 897/2023 is pending, under Section 24 of the Code of Civil Procedure, 1908, to consolidate matters involving potentially similar evidence, particularly relating to GST issues? Petitioner's arguments: The petitioner contended that they are the defendants in both suits and that the matters involve similar evidence, especially concerning GST issues, and that both were effectively filed by Mr. Surender Kumar Jain for recovery of amounts from transactions with the petitioner. Revenue/State's arguments: The judgment does not record any specific arguments from the respondent (Mr. Surender Kumar Jain) or the State. However, the Court's reasoning indicates a consideration of the respondent's position implicitly.