# Shivam Traders & Hire Purchase Pvt. Ltd v. Madhusudan Vehicle Pvt. Ltd

- **Citation:** (2026) 3 ILRA 1100
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2026-03-31
- **Case number:** First Appeal No. 253 of 2025
- **Bench:** Sandeep Jain
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/shivam-traders-hire-purchase-pvt-ltd-v-madhusudan-vehicle-pvt-ltd-54865
- **Pages:** 20

## Text

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1100 INDIAN LAW REPORTS ALLAHABAD SERIES
favour by defendants of the 2nd set, who are the legal heirs of deceased Mohd. Anas and Mohd.
Iliyas, who have certainly inherited a share in the disputed property as per the applicable Hanafi
Law. In view of this, no relief of permanent injunction can be granted to the plaintiffs against the
true owners of the disputed property, without seeking the efficacious remedy of partition of the
disputed property,hence, the plaintiff 's suit is also barred by Section 41(h) of the Specific Relief
Act,1963, in light of the judgment of the Apex Court in Padhiyar Prahladji Chenaji (supra),
Ratnagiri Nagar Parishad (supra) and Sanjay Paliwal (supra) .

92. In view of the above analysis, the trial court has not erred in dismissing the plaintiffs
suit, which does not warrant any interference from this Court in exercise of its appellate
jurisdiction. The appeal is meritless and is liable to be dismissed at the admission stage under Order
41 Rule 11 CPC.

93. Accordingly, the instant appeal is dismissed at the admission stage. Consequently,
the impugned judgment and decree dated 20.1.2026 is affirmed.
----------
(2026) 3 ILRA 1100
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 31.03.2026

BEFORE

THE HON'BLE SANDEEP JAIN, J.

First Appeal No. 253 of 2025

Shivam Traders & Hire Purchase Pvt. Ltd. ...Appellant
Versus
Madhusudan Vehicle Pvt. Ltd. ...Respondent

Issues for Consideration
(i) Whether a civil suit seeking permanent injunction restraining recovery of loan/deposit by a depositor from
a Non-Banking Financial Company (NBFC), before expiry of the contractual tenure of the loan, discloses a
cause of action when proceedings under Section 45QA of the Reserve Bank of India Act, 1934 have already
been initiated before the National Company Law Tribunal (NCLT)?
(ii) Whether disputes relating to repayment of deposits/loans advanced to an NBFC and the entitlement of the
depositor to seek repayment are matters falling exclusively within the jurisdiction of the NCLT under Section
45QA of the Reserve Bank of India Act, 1934?
(iii) Whether a civil court can grant injunction restraining institution or prosecution of proceedings for recovery
of deposits/loans before the NCLT, in view of Section 41(b) of the Specific Relief Act, 1963 and Section 430 of
the Companies Act, 2013?
(iv) Whether the plaint was liable to be rejected under Order VII Rule 11 CPC as the suit was barred by law
and did not disclose a legally enforceable cause of action?

Headnotes
Reserve Bank of India Act, 1934 - Ss. 45-I(bb), 45QA and 45Q - Companies Act, 2013 - S. 430
- Code of Civil Procedure, 1908 - O. VII r.11 - NBFC - Loan advanced to NBFC - 'Deposit'
includes loan - Jurisdiction of NCLT - Civil suit seeking injunction against recovery proceedings.
3 All. Shivam Traders & Hire Purchase Pvt. Ltd. Vs. Madhusudan Vehicle Pvt. Ltd.
1101
HELD: Under Section 45-I(bb) of the Reserve Bank of India Act, the expression "deposit" includes money
received by way of loan. Consequently, where money has been advanced to an NBFC as a loan, the person or
company advancing such amount is entitled to invoke Section 45QA of the Act for repayment. The
adjudication whether the depositor is entitled to repayment, whether default has occurred, and the manner in
which repayment is to be effected, falls within the exclusive domain of the NCLT. The dispute raised by the
plaintiff regarding premature recovery of the amount advanced by the defendant could, therefore, be
determined only in proceedings under Section 45QA of the RBI Act. [Paras 47, 48, 58]

Companies Act, 2013 - S. 430 - Reserve Bank of India Act, 1934 - S. 45QA - Civil Court's
jurisdiction - Bar of jurisdiction - Injunction against proceedings before NCLT.

HELD: Section 430 of the Companies Act expressly excludes the jurisdiction of civil courts in respect of
matters which the NCLT or NCLAT is empowered to determine under the Companies Act or any other law for
the time being in force. Where proceedings under Section 45QA of the RBI Act are maintainable before the
NCLT, the civil court cannot entertain a suit relating to the same subject matter, nor can it grant an injunction
restraining any action taken or proposed to be taken before the NCLT. Since the dispute regarding repayment
of the loan/deposit advanced to the plaintiff NBFC was exclusively triable by the NCLT, the civil court lacked
jurisdiction to entertain the suit. [Paras 52, 53, 58]

Specific Relief Act, 1963 - S. 41(b) - Permanent injunction - Suit filed to prevent initiation or
continuation of statutory proceedings - Maintainability.

HELD: The plaint itself disclosed that the plaintiff apprehended initiation of proceedings for recovery of the
loan/deposit by the defendant. The suit was instituted to restrain the defendant from pursuing such
proceedings and thereby to pre-empt adjudication by the competent statutory forum. A suit seeking to
prevent institution or prosecution of proceedings which the defendant was legally entitled to pursue before
the NCLT is barred by Section 41(b) of the Specific Relief Act. The defendant could not be restrained from
invoking the statutory remedy available under Section 45QA of the RBI Act. [Para 51]

Code of Civil Procedure, 1908 - O. VII r.11 - Cause of action - Suppression of material facts -
Prior proceedings before NCLT concealed from Court - Effect.

HELD: The defendant had instituted proceedings under Section 45QA of the RBI Act before the NCLT prior to
the filing of the suit. The plaintiff was aware of those proceedings but failed to disclose the same in the plaint.
Since the controversy regarding repayment of the loan/deposit was already pending before the competent
statutory forum, the plaintiff had no independent cause of action to institute a suit seeking injunction against
recovery proceedings. The suppression of the pending NCLT proceedings constituted concealment of material
facts and disentitled the plaintiff from obtaining equitable relief. [Para 49]
Injunction - Equitable relief - Suppression of material facts - Requirement of clean hands.

HELD: A party seeking injunction must approach the Court with utmost candour and disclose all material facts
having a bearing on the controversy. Suppression of pending proceedings before the competent forum
disentitles the plaintiff from obtaining discretionary and equitable relief. A litigant who conceals material facts
cannot claim injunction as a matter of right. [Paras 49, 50, 58]

Code of Civil Procedure, 1908 - O. VII r.11 - Successive applications - Earlier application
dismissed in default - Fresh application on same grounds.

HELD: Where an earlier application under Order VII Rule 11 CPC had been dismissed for non-prosecution and
not on merits, a subsequent application raising the same grounds was maintainable. Mere inadvertent
reference by the trial court to the number of the earlier application instead of the later application did not
1102 INDIAN LAW REPORTS ALLAHABAD SERIES
cause prejudice to the plaintiff when the parties had in fact addressed arguments on the subsequent
application and were fully aware of the controversy involved. [Paras 54-57]

Code of Civil Procedure, 1908 - O. VII r.11 - Plaint barred by law - Jurisdiction excluded by
special statute - Rejection of plaint.

HELD: Since the dispute concerning repayment of the loan/deposit was exclusively triable by the NCLT under
Section 45QA of the RBI Act and the jurisdiction of the civil court stood barred by Section 430 of the
Companies Act, the relief of permanent injunction claimed by the plaintiff could not be granted by the civil
court. The plaint was, therefore, rightly rejected under Order VII Rule 11 CPC and the appeal was liable to be
dismissed. [Paras 52, 53, 58-60]

Appeal dismissed with costs. Order rejecting plaint affirmed. (E-14)

Case Law Cited
Shashi Prakash Khemka v. NEPC Micon Ltd., (2019) 18 SCC 569-relied on; Nirbhay Kapoor v.
Kamero Technosys Ltd., First Appeal No. 427 of 2019 decided on 01.07.2019 - relied on; Suraj
Prakash Arora v. Roshanara Club Ltd., 2025 SCC OnLine Del 2518 - relied on; Suraj Prakash
Arora v. Roshanara Club Ltd., 2025 SCC OnLine Del 3761 - relied on; Sas Hospitality Pvt. Ltd. v.
Surya Constructions Pvt. Ltd., 2018 SCC OnLine Del 11909 - relied on; Smiti Golyan v. Nulon
India Ltd., 2019 SCC OnLine SC 2383 - relied on; Chiranjeevi Rathnam v. Ramesh, 2017 (6) CTC
568 - relied on; Valluvar Kuzhumam Pvt. Ltd. v. APC Drilling & Construction Pvt. Ltd.,
MANU/TN/9215/2022 - relied on; Chiranjeevi Rathnam v. Ramesh, 2017 (6) CTC 568 - relied
on; Valluvar Kuzhumam Pvt. Ltd. v. APC Drilling & Construction Pvt. Ltd., MANU/TN/9215/2022
- relied on; Vinod Infra Developers Ltd. v. Mahaveer Lunia, 2025 INSC 772 - referred to;
Keshav Sood v. Kirti Pradeep Sood, 2023 SCC OnLine SC 2459 - referred to; Ramjas Foundation
v. Union of India, (2010) 14 SCC 38 - referred to; Shri Vassudev Nene v. Shri Dattatraya
Raghunath Jog, 1999 SCC OnLine Bom 212 - referred to; Km. Sunita v. Manju, 2025 SCC OnLine
All 3740 - referred to; Rajasthan State Road Transport Corpn. v. Bal Mukund Bairwa (2), (2009)
4 SCC 299 - held inapplicable; Saranpal Kaur Anand v. Praduman Singh Chandhok, 2022
Supreme (SC) 898 - held inapplicable; Assa Singh v. Shanti Prasad, (2021) 19 SCC 290 - held
inapplicable; Whirlpool Corporation v. Registrar of Trade Marks, (1998) 8 SCC 1 - held
inapplicable; Shailja Krishna v. Satori Global Ltd., 2025 SCC OnLine SC 1889 - held inapplicable.

List of Acts / Statutes
Code of Civil Procedure, 1908; Specific Relief Act, 1963; Reserve Bank of India Act, 1934; Companies Act,
2013; National Company Law Tribunal Rules, 2016 - Rule 73.

List of Keywords
Rejection of plaint; NBFC; Deposit; Loan; NCLT jurisdiction; Civil court jurisdiction barred; Permanent
injunction; Premature recovery of loan; Suppression of material facts; Clean hands doctrine; Cause of action;
Statutory remedy; Equitable relief.

Case Arising From
Order dated 01.03.2025 passed by the Civil Judge (Senior Division), Agra in O.S. No. 3 of 2021, Shivam
Traders & Hire Purchase Pvt. Ltd. v. Madhusudan Vehicles Pvt. Ltd.

Appearance for Parties
For the Appellants: Sri Anil Kumar Pandey
For the Respondents: Sri Rahul Agarwal and Sri Vedant Agarwal

(Delivered by Hon'ble Sandeep Jain, J.)
3 All. Shivam Traders & Hire Purchase Pvt. Ltd. Vs. Madhusudan Vehicle Pvt. Ltd.
1103

1. The instant appeal has been preferred by the plaintiff under Section 96 CPC against the
impugned order dated 01.3.2025 passed by the court of Civil Judge(Senior Division),Agra in O.S.
no. 3 of 2021 Shivam Traders & Hire Purchase Pvt.Ltd. vs. Madhusudan Vehicles Pvt. Ltd.,
whereby defendant's application 17-C under Order VII Rule 11 CPC has been allowed and
consequently, the plaint has been rejected.

Plaint case

2. The plaintiff appellant Shivam Traders & Hire Purchase Pvt.Ltd. filed O.S. No. 3 of
2021 against the defendant Madhusudan Vehicles Pvt. Ltd.with the averments that the plaintiff is a
company duly incorporated and registered under the Companies Act, 1956, who has authorised
through its resolution dated 11.5.2020 one of its director Smt. Meena Kumari wife of late Daya
Shanker Gupta to sign and verify the plaint and file the suit on behalf of the plaintiff. It was further
averred that the plaintiff is carrying on the business of financing as a non-banking financial
company(NBFC) and is registered with Reserve Bank of India as NBFC having certificate of
registration no. B 12.00181. It was further averred that the plaintiff for its business has taken
long term loan of ₹ 19.25 crores from the defendant during the period 30.5.2019 to 10.6.2019 at an
interest of 8% per annum compounded annually, the tenure of the loan was 9 years commencing
from the date of disbursement of the loan, the repayment of the loan with interest was to be made
after the maturity period of 9 years in 12 equal quarterly instalments. It was further averred that the
terms of advancement of the above long-term loan and its repayment was reduced in the form of
writing on 4.4.2019 containing the proposal of the defendant to grant the above loan and its
acceptance by the plaintiff.

3. It was further averred that under the above agreement of long-term loan, it was
specifically agreed that the defendant shall not have a right to call for the repayment of the loan or
interest before the majority of the term of 9 years. The plaintiff duly submitted in the schedule 'A'
of the plaint the details of disbursement of the above loan of ₹ 19.25 crores. It was further averred
that the plaintiff utilised the above long-term loan by giving long-term finance to the parties as part
of its business activity and the defendant was bound by the terms of the above agreement of longterm loan and was precluded from asking for repayment of the loan before the expiry of 9 years
from the date of disbursement of the loan. It was further averred that apart from the above longterm loan of ₹ 19.25 crores, the plaintiff had also taken short-term loan of ₹ 149,977/- from the
defendant, which was not in dispute in the suit.

4. It is the specific case of the plaintiff that the defendant in utter disregard and in violation
of the terms of the long-term loan agreement dated 4.4.2019, after expiry of only one year, started
putting undue pressure on the plaintiff to repay the above loan amount of ₹ 19.25 crores with
interest and sent a letter dated 14.4.2020 to the plaintiff to repay the above loan amount with
interest, which was followed by reminder dated 2.6.2020. It was further averred that in order to
further pressurise the plaintiff the defendant sent letters dated 16.5.2020, 28.6.2020 and 1.8.2020 to
the RBI, seeking direction to the plaintiff to repay the above loan with interest, wrongly
representing the above loan amount as deposit and concealing the fact that the advancement of the
above loan to the plaintiff was subject to the terms of the agreement dated 4.4.2019. It was further
1104 INDIAN LAW REPORTS ALLAHABAD SERIES
submitted that the defendant illegally, with malafide intentions and ulterior motive, included the
amount of ₹ 1,49,977/- which was not part of the long-term loan amount of ₹ 19.25 crores.

5. It was further averred that the stand taken by the defendant in its above letters and in the
complaints made to RBI, casted the cloud on the rights of the plaintiff under the long term loan
agreement dated 4.4.2019 hence the plaintiff was constrained to file the suit for declaration and
injunction to protect infringement of its rights under the above agreement dated 4.4.2019. It was
further averred that the injury threatened to the plaintiff was imminent and serious and if the
injunction prayed for was not granted and the defendant started proceedings for recovery of the
loan amount in violation of the terms of the agreement dated 4.4.2019 the plaintiff shall have to
face frivolous and vexatious proceedings and will also come under serious financial pressure since
it cannot recover the above amount from those to whom it has given long-term finance which will
cause serious irreparable loss to the plaintiffs goodwill and its business.

6. In view of the above backdrop, the plaintiff claimed the following reliefs:-

 (i)A decree of permanent injunction restraining the defendant from prematurely
recovering the loan amount of ₹ 20,52,02,295/- or the interest accrued on it or any part of such
loan amount or interest from the plaintiff in violation of the terms of the agreement dated 4.4.2019
as mentioned in para-3 of the plaint before the expiry of 9 years from the dates of disbursement of
such loan as mentioned in schedule 'A' of the plaint, be passed in favour of the plaintiff against the
defendant.

 (ii) Costs of the suit be granted to the plaintiff against the defendant.

 (iii) Any other relief which the court thinks fit be also granted to the plaintiff against the
defendant.

 Defendant's application under Order VII Rule 11 CPC

7. The defendant moved application 17-C under Order VII Rule 11 CPC with the
averments that the plaintiff has filed the suit for the relief of permanent injunction seeking to
restrain the defendant from recovering the loan amount in suit prematurely, which was not
maintainable and was expressly barred by law and the plaint was liable to be rejected under Order
VII Rule 11 CPC for the following reasons :-

 (i)That the suit was expressly barred by Sections 10,14, 38 and 41 of the Specific Relief
Act as money was adequate relief and no injunction can be granted to seek injunction against
recovery of amount due. The contract in question is otherwise determinable in nature and cannot
be enforced.

 (ii)That the suit was expressly barred by Section 41(e)(h) and (i) of the Specific Relief
Act.
3 All. Shivam Traders & Hire Purchase Pvt. Ltd. Vs. Madhusudan Vehicle Pvt. Ltd.
1105
 (iii)The plaint does not disclose any cause of action for the relief claimed against
defendant.

 Objection filed by the plaintiff to the defendants application under Order VII Rule
11 CPC

8. The plaintiff submitted its objection 18-C in which it was averred that the defendants
application was misconceived and was moved only to delay the disposal of the suit and to avoid
hearing of the injunction application of the plaintiff. It was denied that the suit was barred by any
law. It was also denied that the contract in question was determinable in nature and cannot be
enforced. It was averred that the plaint allegations clearly disclose cause of action for filing the
present suit. It was further averred that the plaintiff has filed the suit to restrain the defendant from
committing breach of its obligations as stipulated in the loan agreement dated 1.4.2019
whereunder, the defendant advanced long-term loan of ₹ 15 crores to the plaintiff for the term of 9
years and it was specifically mentioned in the above agreement that before the expiry of 9 years,
the defendant shall not have the right to reclaim the loan amount. It was further averred that the
defendant was committing breach of its above obligation to compel the plaintiff to file the present
suit. It was further averred that the suit was perfectly maintainable under law and the defendants
application was not legally maintainable, which was liable to be dismissed with costs.

9. From the perusal of the ordersheet of O.S. no. 3 of 2021 it is evident that the above
application of the defendant 17-C was dismissed for non-prosecution by the trial court on
10.7.2024 as such, this application was again filed by the defendant with the same averments,
which was numbered as 27-C on 28.8.2024.

Additional application by the defendant under Order VII Rule 11 CPC

10. On 23.9.2024 the defendant moved an additional application 34-C taking additional
grounds under Order VII Rule 11 CPC. It was averred that suit was liable to be dismissed on the
following additional grounds:-

 (A) Suppression of pending disputes before the National Company Law Tribunal(NCLT),
Allahabad Bench

11. It was averred that the plaintiff has suppressed before the court the institution of
proceedings by the defendant before the NCLT, Allahabad Bench, being CA no.190/ALD/2020
titled Madhusudan Vehicles Pvt. Ltd. vs.Shivam Traders & Hire Purchase Pvt.Ltd. which was
subjudice. The instant suit was filed to apparently interfere with the jurisdiction of the NCLT under
Section 45 QA of the RBI Act, on false and frivolous grounds, seeking injunction against the
defendant from recovering any portion of the said deposits in violation of the terms and conditions
of the purported agreement. It was further averred that the defendant having not received the
payment of the deposit/loan along with interest at the rate of 8 % per annum instituted the said
company application under Section 45 QA of the RBI Act. It was further averred that advance
service of the institution of the said company application was effected on the plaintiff in September
1106 INDIAN LAW REPORTS ALLAHABAD SERIES
2020, and a copy was also physically served on the respondent(here plaintiff) on 14.10.2020, and
subsequently, in February 2021 the instant suit has been filed.

(B) Bar under the Specific Relief Act

12. It was further averred that Section 41 of the Specific Relief Act bars grant of any
injunction to restrain a person from prosecuting legal proceedings, in this case proceedings before
the NCLT Allahabad Bench,being CA no.190/ALD/2020 titled Madhusudan Vehicles Pvt. Ltd.
vs.Shivam Traders & Hire Purchase Pvt.Ltd., where the dispute in relation to the payment of
deposits can be equally efficaciously adjudicated upon.

(C)Reserve Bank of India Act is a special law which supersedes general law

13. It was averred that Section 45 QA of the Reserve Bank of India Act, 1934 protects
depositors interests especially in cases of non-banking financial companies(NBFCs) failing to
repay deposits and Rule 73 of the National Company Law Tribunal(NCLT) Rules, 2016,
compliments this provision by establishing a legal framework for filing applications related to the
repayment of deposits. The above provisions are special law, which supersedes general laws,
reinforcing the RBI's authority in addressing depositors grievances and ensuring financial stability.
It was further averred that the RBI Act operates with overriding authority in matters of financial
regulation and depositors protection.

(D)Exclusive jurisdiction of the NCLT under Section 45 QA RBI Act

14. It was averred that Section 73(1) of the Companies Act prohibits acceptance or renewal
of deposits except in the manner provided under Chapter V of the Companies Act. However, in
respect of banking companies and NBFCs, the mode and manner of acceptance of deposits is
determined under the RBI Act. It was further averred that chapter III-B of the RBI Act governs the
business of non-banking financial institution, which is a complete code in itself, and Section 45Q
categorically states that the provisions of this chapter shall have effect notwithstanding anything
inconsistent with any other law. It was averred that,de hors, the framework of this chapter, it was
impermissible for the NBFC to receive any money, which also includes deposit as defined under
Section 45-I(bb) of the above Act which applies in the instant case also, since the plaintiff was
liable to repay the deposits to the defendant. It was further averred that clause 7 of the purported
agreement will not prevail in view of section 45Q of the above Act. It was averred that the remedy
under Section 45 QA is available to the depositor/defendant, hence the dispute canvassed by the
plaintiff in the suit ought to have been adjudicated in terms of the forum prescribed under the RBI
Act.

(E)Bar under Section 430 of Companies Act, 2013

15. It was averred that the dispute mentioned in the plaint was pending for adjudication
before the NCLT, Allahabad as such, the bar under Section 430 of the Companies Act operated and
the court had no jurisdiction to entertain and adjudicate the dispute.
3 All. Shivam Traders & Hire Purchase Pvt. Ltd. Vs. Madhusudan Vehicle Pvt. Ltd.
1107
(F) Plaint was insufficiently stamped

16. It was averred that plaintiff has under valued the entire suit at ₹ 20,52,09,295/-in order
to avoid payment of court fees. It was averred that plaintiff was liable to pay court fees on
advalorem basis, as such, plaint was liable to be rejected on this basis.

(G) No cause of action

17. It was averred that plaintiff admits that huge sums of money are due to the defendant,
however in order to avoid the payment thereof, has canvassed a false case of existence of purported
agreement. It was further averred that notwithstanding the existence of the purported agreement,
the plaintiff being an NBFC, governed under the provisions of RBI Act and rules, regulations,
master directions, etc. framed thereunder was liable to repay the deposits in terms of the applicable
law of RBI. The suit was filed in respect of the purported agreement/letters, which was in
contravention of the extant law of RBI, and no cause of action has arisen as alleged by the plaintiff,
to file the instant suit.

Reasoning of the trial court

18. The trial court opined that under Section 430 of the Companies Act, 2013 in any matter
which was to be adjudicated by the NCLT or NCLAT, the civil court has neither any jurisdiction
nor it can grant injunction in that matter. The trial court after only considering the plaint,opined that
it discloses that the plaintiff and defendant both are NBFCs, who are having a dispute as to the
repayment of a loan, regarding which only the NCLT constituted under the Companies Act was
having jurisdiction to decide such disputes and as such, the jurisdiction of the civil court was barred
under Section 430 of the Companies Act, 2013. In view of the above reasoning, the defendant's
application 17-C under Order VII Rule 11 CPC was accepted and consequently, the plaint was
rejected, aggrieved against which, the plaintiff has filed the instant appeal under Section 96 CPC.

Submissions of the learned counsel of the parties

19. Sri Arvind Srivastava learned counsel for the plaintiff appellant submitted that 17-C
application was moved by the defendant under Order VII Rule 11 CPC which was dismissed for
non-prosecution by the trial court on 10.7.2024, this order was never recalled by the trial court as
such, 2nd application on the same ground was not legally maintainable. Learned counsel further
submitted that the defendant again, on the same facts, moved an application 27-C under Order VII
Rule 11 CPC on 28.8.2024, which was legally not maintainable, but it was entertained by the trial
court, but the impugned order discloses that defendant's application 17-C under Order VII Rule 11
CPC was rejected, which had previously been dismissed for non-prosecution on 10.7.2024.
Learned counsel submitted that since application 17-C under Order VII Rule 11 CPC was earlier
dismissed by the trial court on 10.7.2024, as such that application could not have been dismissed
again by the trial court on 01.3.2025, which shows that the trial court has not applied its mind to the
controversy in hand. Learned counsel submitted that only on this ground, the impugned order is
liable to be set aside.
1108 INDIAN LAW REPORTS ALLAHABAD SERIES
20. It was further submitted that the defendant filed additional application 34-C under
Order VII Rule 11 CPC on 23.9.2024, taking additional grounds, a copy of which was never given
to the plaintiff, as such the plaintiff could not file any objection against it, but without noticing this
fact, the trial court has considered the averments mentioned in application 34 C, which is illegal.
It was further submitted that the impugned order mentions the number of the above application as
24-C, which is also erroneous.

21. It was further submitted that as per settled law only the plaint averments and the
documents submitted by the plaintiff should have been considered by the trial court for deciding the
application under Order VII Rule 11 CPC but the trial court has considered the averments of the
defendant mentioned in application 27-C and 34-C and the documents of the defendant, which is
impermissible.

22. It was further submitted that prima-facie on the basis of plaint averments, since the
defendant was not entitled to prematurely demand the repayment of loan before the expiry of the
duration of the loan, which was 9 years, the plaintiff was entitled to claim the relief of permanent
injunction restraining the defendant from recovering the loan, as such, the plaintiff 's suit was not
barred by any law, but the trial court has erroneously held that it was barred under Section 430 of
the Companies Act, 2013, which is a perverse finding. It was further submitted that the plaintiff
was not having any other remedy except filing the instant suit for restraining the defendant from
recovering the loan amount prematurely. It was further submitted that the remedy of 45 QA of the
RBI Act was only available to the depositor /defendant, not to the plaintiff, as such, the plaintiff
could never have initiated proceedings before the National Company Law Tribunal(NCLT).

23. With these submissions it was prayed that the appeal be allowed and the impugned
order be set aside. Learned counsel in support of his submissions has relied on the following case
law:-

 (i)Rajasthan State Road Transport Corpn. and another vs. Bal Mukund Bairwa(2) (2009)
4 SCC 299(by 3 Judges).

 (ii)Saranpal Kaur Anand vs. Praduman Singh Chandhok & ors. 2022 Supreme (SC) 898

 (iii)Assa Singh (Dead) by Lrs.vs. Shanti Prasad (Dead) by Lrs and ors.(2021) 19 SCC
290

 (iv)Whirlpool Corporation vs. Registrar of Trade Marks Mumbai and ors.(1998) 8 SCC 1

24. Per contra, Sri Vedant Agarwal learned counsel for the defendant respondent submitted
that the plaintiff has deceitfully tried to create the jurisdiction of the civil court by suppressing
material facts from the court. Learned counsel submitted that it is admitted to the plaintiff and
defendant that both are NBFCs, and it is also admitted to the plaintiff that the loan was given to it
by the defendant regarding which the defendant had initiated proceedings for the repayment of loan
and had also raised the dispute before the NCLT, as such,since the lis was pending before the
NCLT, any relief to the plaintiff regarding repayment of loan could only have been granted by the
3 All. Shivam Traders & Hire Purchase Pvt. Ltd. Vs. Madhusudan Vehicle Pvt. Ltd.
1109
NCLT, as such, the plaintiff could not have invoked the jurisdiction of the civil court in this matter
because the jurisdiction of the civil court was barred.

25. It was further submitted by the learned counsel that since proceedings under Section 45
QA of the RBI Act had been initiated prior to the filing of the suit by the defendant for recovery of
the loan and interest payable on it, no civil suit restraining the defendant from doing so was
entertainable by the civil court. It was further submitted that once any proceedings are initiated
before the NCLT in any matter, then under Section 430 of the Companies Act, 2013, the
jurisdiction of the civil court is ousted and in such circumstances, since the application of the
defendant under Section 45 QA of the RBI Act was pending before the NCLT, Allahabad
Bench,Prayagraj, no relief in respect of the alleged recovery of loan could have been granted by the
civil court as such, the civil court has not committed any illegality in allowing the defendant's
application under Order VII Rule 11 CPC and rejecting the plaint.

26. It was further submitted that the earlier application of the defendant 17-C under Order
VII Rule 11 CPC was dismissed in default on 10.7.2024, which was not on merits, as such, 2nd
application on the same facts bearing no. 27-C was filed on 28.8.2024, which was legally
maintainable. It was further submitted that a copy of application 34-C containing additional
grounds under Order VII Rule 11 CPC was filed on 23.9.2024, a copy of which was also given to
the plaintiff, which is disclosed from the endorsement made by the plaintiff on this application, and
the application was finally disposed on 1.3.2025. It was further submitted that sufficient
opportunity was given to the plaintiff to file its objection to the defendant's application 34-C, but no
objection was filed by the plaintiff, for which the defendant cannot be blamed. It was further
submitted that the trial court has passed reasoned order, which does not warrant any interference by
this Court in exercise of its appellate jurisdiction. With these submissions it was prayed that the
appeal be rejected. In support of his submission learned counsel has relied upon the following case
law:-

 (i)Shashi Prakash Khemka & ors. vs.NEPC Micon Ltd. & ors.(2019)18 SCC 569.

 (ii)Nirbhay Kapoor vs.M/S Kamero Technosys Ltd.& anr. FA no.427 of 2019 dated
01.7.2019.

 (iii)Suraj Prakash Arora and ors. vs. Roshanara Club Ltd. and others 2025 SCC OnLine
Del 2518(Single Judge Bench).

 (iv)Suraj Prakash Arora and ors. versus Roshanara Club Ltd. and others 2025 SCC
OnLine Del 3761(Division Bench).

 (v)Sas Hospitality P.Ltd and anr. vs.Surya Constructions P. Ltd. and ors.(2018)SCC
OnLine Del 11909.

 (vi)Smiti Golyan and anr. vs.Nulon India Ltd. and ors. 2019 SCC OnLine SC 2383.

 (vii)Chiranjeevi Rathnam and ors. vs.Ramesh and ors. 2017 (6) CTC 568.
1110 INDIAN LAW REPORTS ALLAHABAD SERIES
 (viii)Valluvar Kuzhumam Pvt.Ltd. vs. APC Drilling & Construction Pvt. Ltd. and ors.
MANU/TN/9215/2022.

 (ix)Shailja Krishna vs.Satori Global Ltd. And ors. 2025 SCC OnLine SC 1889

27. Having heard the parties and on consideration of the materials on record, the following
points arise for determination :-

 (A)Whether the plaintiff had any cause of action to file the instant suit?

 (B)Whether the suit was filed to pre-empt any action being taken by the National
Company Law Tribunal (NCLT) or the Reserve Bank of India in the proceedings initiated by
defendant for the recovery of the loan advanced to the plaintiff ?

 (C)Whether the dispute as to whether the defendant was entitled to recover the loan
prematurely, before the expiry of the duration of the loan, could only have been determined by the
National Company Law Tribunal(NCLT) ?

 (D)Whether the suit was barred under Section 45 QA of the RBI Act,1934 read with
Section 430 of the Companies Act, 2013 ?

Analysis of case law submitted by the appellant

28. The Apex Court in the case of Rajasthan State Road Transport Corpn.(supra) was
considering the jurisdiction of Civil Court vis-a-vis Labour Court in the employer employee
dispute. It was held that if a statute while creating rights and obligations does not constitute a forum
for enforcing the same, the plenary jurisdiction of civil court cannot be held to have been taken
away. It is apparent that the ratio of the above case is not applicable in the facts and circumstances
of the instant case.

29. The Apex Court in the case of Saranpal Kaur Anand (supra) was considering a case
where plaint was rejected being barred by limitation under Order VII Rule 11(d) CPC, which is
different from the facts and circumstances of the instant case.

30. The Apex Court in the case of Assa Singh (supra) was considering the dispute between
the landlord and tenant under Punjab Security of Land Tenures Act, 1953 in a ejectment suit and it
was held that only the civil court, and not the revenue court, has the power to decide question of
existence of landlord-tenant relationship, but only when the plea is raised in that regard is genuine.
It is apparent that the ratio of the above case is not applicable in the facts and circumstances of the
instant case.

31. The Apex Court in the case of Whirlpool Corporation (supra) was considering in
which situation the alternative remedy operates as a bar in the writ petition filed under Article 226
of the Constitution of India, in the context of Trade and Merchandise Marks Act, 1958. It is
3 All. Shivam Traders & Hire Purchase Pvt. Ltd. Vs. Madhusudan Vehicle Pvt. Ltd.
1111
apparent that the ratio of the above case is not applicable in the facts and circumstances of the
instant case.

Analysis of case law submitted by the respondent

32. The Apex Court in the case of Shashi Prakash Khemka (supra) was considering the
dispute relating to transfer of shares of the company. After considering Section 430 of the
Companies Act,2013 it was held that in matters in respect of which power has been conferred on
the NCLT, the jurisdiction of the civil court is completely barred.

33. This Court in Nirbhay Kapoor (supra) also held that the jurisdiction of civil court is
excluded in cases where the matter in dispute is required under the Act of 2013 to be determined by
the Tribunal. It was further held that since the complaint of the plaintiff was with respect to the
property of the defendant company and conduct of its affairs, the suit was clearly barred by Section
430 of the Companies Act, 2013. It was further held that Section 37 of the Act provides for filing of
a suit in certain circumstances but the plaintiff 's case was not covered by it.

34. Similarly, the High Court of Delhi in Suraj Prakash Arora (supra) and Sas Hospitality
P.Ltd (supra) has held that Section 430 of the Companies Act, 2013 bars the jurisdiction of the civil
court in matters falling in the domain of NCLT, which it is empowered to adjudicate under
different provisions of the Act and these powers are wider and broader than the powers of the civil
court under Section 9 CPC, being a specialised Tribunal created for the purpose of regulating
adjudication of the affairs of the companies expeditiously.

35. The Madras High Court in Chiranjeevi Rathnam (supra) was dealing with a case
where an injunction was sought restraining the conduct of the extraordinary general meeting, it was
held that the civil court has no jurisdiction and the suit would be barred under Section 430 of the
Companies Act, 2013.

36. The Madras High Court in Valluvar Kuzhumam Pvt.Ltd (supra) has also held that the
civil court's jurisdiction is completely barred in respect of any matter which the Tribunal or the
Appellate Tribunal is empowered to determine.

37. The order of the Apex Court in Smiti Golyan (supra) affirmed the judgment of the
NCLAT whereby, the dispute as to the ownership and title of the disputed shares, was held to be
maintainable before the NCLT.

38. The ratio of the judgment of the Apex Court in Shailja Krishna vs.Satori Global
Ltd.(supra) is not applicable in the facts of the instant case, which was a case of oppression and
mismanagement of the affairs of the company wherein Board meeting was conducted without
notice to aggrieved Director and requisite quorum, Additional Director was appointed illegally,
shares were transferred on invalid transfer forms which were illegally shown to be gifted,etc.

Interpretation of Order VII Rule 11 CPC
1112 INDIAN LAW REPORTS ALLAHABAD SERIES
39. The Apex Court in the case of Vinod Infra Developers Ltd. vs. Mahaveer Lunia and
others 2025 INSC 772 has held that at the preliminary stage of deciding Order VII Rule 11 CPC
application, the court is required to confine its examination strictly to the averments made in the
plaint and not venture into the merits or veracity of the claims. If any triable issues arise from the
pleadings, the suit cannot be summarily rejected.

40. The Apex Court in the case of Keshav Sood vs. Kirti Pradeep Sood and others 2023
SCC OnLine SC 2459 has held that the scope of Rule 11 of Order VII of CPC is concerned, the
law is well settled. The court can look into only the averments made in the plaint and at the highest,
documents produced along with the plaint. The defence of defendant and documents relied upon by
him cannot be looked into while deciding such application.

41. It is apparent from the above law laid down by the Apex Court in the case of Vinod
Infra(supra) and Keshav Sood(supra) that at the time of deciding Order VII Rule 11 CPC
application, the court has to look into only the averments made in the plaint and the documents
submitted by the plaintiff. The court has not to examine the written statement of the defendant or
the documents submitted by it. Further, the court has also not to examine the plaintiffs case on
merit to determine whether he is going to succeed or not ? It is also apparent that if any triable issue
arises out of the pleadings of the plaintiff, then the plaint cannot be summarily rejected.

Relevant definitions

42.