Allahabad High Court: Rejection of Application Under Order VII Rule 11 Not Res Judicata on Limitation Issue

February 14, 2024

In a recent ruling, the Allahabad High Court clarified that the rejection of an application under Order VII Rule 11 of the Civil Procedure Code (CPC) does not establish res judicata concerning the issue of limitation raised during the final hearing. The court emphasized that questions of limitation involve both law and fact and necessitate evidence from contesting parties.


The specific case arose when the Debt Recovery Tribunal (DRT) rejected an application under Order VII Rule 11 of the CPC, filed by a petitioner contesting the limitation of a claim. The High Court, in its verdict, emphasized that the determination of limitation is not appropriate during the initial stages of assessing an application under Order VII Rule 11. Rather, it should be examined during the trial process based on evidence presented by both parties.

Background of the Case

The legal dispute traces back to 1994-96 when the IDBI granted financial assistance to Gilt Pack Ltd., with the petitioner providing guarantees. In 2016, the Stressed Asset Stabilisation Fund, as the assignee of IDBI, filed an application before the Debt Recovery Tribunal seeking repayment of loans. The petitioner then raised concerns about the limitation of the claim.

Court's Verdict and Rationale

The High Court highlighted that under Order VII Rule 11 of the CPC, a plaint can be rejected only if it appears to be barred by law, including limitation, based solely on the statements made within the plaint. The defense presented by the defendant should not influence the decision at this stage.

The court cited relevant Supreme Court judgments, emphasizing that the issue of limitation requires a detailed examination of facts and law, which can only occur during the trial phase. Therefore, the rejection of the application under Order VII Rule 11 does not preclude further consideration of the limitation issue.

Conclusion and Direction

In conclusion, the High Court directed the Debt Recovery Tribunal to proceed with the case in accordance with the directives of the Debt Recovery Appellate Tribunal. The decision underscores the importance of adhering to procedural norms and ensuring a fair and thorough assessment of legal matters.

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Case Title: Saurabh Kalani v. Stressed Asset Stabilisation Fund And 7 Others [WRIT - C No. - 35362 of 2023]