Facts of the Case

This is a civil recovery suit procedural matter, not a GST dispute. Canara Bank filed a petition under Article 227 of the Constitution challenging an order dated 12 July 2023 passed by the District Judge (Commercial), Karkardooma Courts, Delhi, in CS (COMM) No. 696/2022 (titled “Central Bank v. Soma Engineering”), which directed the Bank's Chairperson to enquire into certain facts concerning a financial facility. The Bank's documents showed that a facility of Rs. 8 lakh, originally issued in 2010 to the erstwhile proprietor of the respondent firm (since deceased), had later been authorised for use by his son, the current proprietor, and that this succession was also evidenced by documents issued by the GST authorities. The Bank sought liberty to place these documents (including the GST-linked succession records) before the Trial Court, to respond to the Trial Court's enquiry, without prejudice to its pleadings in the suit.

Issues Involved

  1. Whether the Bank should be permitted to place additional documents before the Trial Court to address the enquiry directed by the impugned order.

Petitioner's Arguments

  • The Bank's own records, corroborated by GST documentation, showed that the current proprietor was the sole legal heir who had succeeded to the business, and there was no intention to withhold information while filing the suit.
  • As a measure of good faith, the Bank had already initiated the enquiry directed by the Trial Court, but sought an opportunity to place these documents to satisfy the Trial Court on the facts.

Respondent's Arguments

None appeared for the respondent despite advance service.

Court Order / Findings

  • The Court granted the Bank liberty to place the documents filed with the petition before the Trial Court, to satisfy it on the questions framed in the 12 July 2023 order, in addition to (not in place of) the Bank's own independent enquiry.
  • The Trial Court was requested to consider these documents and the Bank's submissions, uninfluenced by its earlier observations, and to grant the respondent an opportunity to respond to the newly-placed documents.

Important Clarification

No GST law issue was adjudicated. The GST documentation referenced here was cited only as evidence of business succession within a private commercial recovery suit; the High Court's order is purely procedural, permitting additional evidence to be placed before the Trial Court.

Sections Involved

  • Constitution of India — Article 227 (supervisory jurisdiction over subordinate courts)

Decision – In Favour of

Disposed of without a decision on merits. The petition was allowed only to the extent of permitting additional documents to be placed before the Trial Court; the underlying recovery suit and the Trial Court's enquiry remain pending.

Case Details

Court: High Court of Delhi at New Delhi
Case No.: CM(M) 1589/2023 with CM APPLs. 49993-94/2023
Coram: Justice Manmeet Pritam Singh Arora
Date of Judgment: 26 September 2023

Link to Download the Order

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