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A Guide to what amounts to ‘Admission’ in a Trial Process

Article by Priyanka Chemudupati and Jagrati Maru

Introduction

In commercial disputes there exists a heavy reliance on documents and consequently, it is a sine qua non for parties to establish the veracity of the same. The principles enshrined in the Code of Civil Procedure, 1908 (hereinafter, CPC) and the Indian Evidence Act, 1872 (hereinafter, Evidence Act) are generally adhered to in arbitration proceedings and therefore, production of evidence by way of Affidavit is followed after completion of pleadings in arbitration as a rule of general practice.

The Hon’ble Supreme Court in Srei Infrastructure Finance Ltd. v. Tuff Drilling Pvt. Ltd.[1] has clearly held that the Arbitral Tribunal can draw sustenance from any provisions of the Code of Civil Procedure. In para 17, the apex Court has held that Section 19 of the Arbitration and Conciliation Act, 1996 (hereinafter, Act) provides for determination of rules of procedure. Further, Section 19(1) provides that the Arbitral Tribunal shall not be bound by CPC or the Evidence Act. The Hon’ble Court clarified that the words “Arbitral Tribunal shall not be bound” are the words of amplitude and not of a restriction. These words do not prohibit the Arbitral Tribunal from drawing sustenance from the fundamental principles underlying the CPC or the Evidence Act but the Tribunal is not bound to observe the provisions of Code with all of its rigour.  As per Section 19(2), the parties are free to agree on the procedure to be followed by the Arbitral Tribunal in conducting its proceedings. Therefore, the settled and fundamental principles enshrined in CPC and the Evidence Act are followed in arbitration proceedings and production of evidence by way of an Affidavit becomes a procedural mandate.

In this article, the authors will be providing a guide to what exactly would be tantamount to an Admission in arbitration proceedings and the judicial dicta on the same.

 

Provisions governing Admissions

 

Section 17 of the Evidence Act

Section 17 defines Admission as a statement oral or documentary or contained in electronic form which suggests any inference as to any fact in issue or relevant fact, and which is made by any of the persons and under the circumstances mentioned in the Act.

 

Section 19 of the Arbitration and Conciliation Act, 1996

Section 19(3) of the Arbitration Act empowers the Arbitral Tribunal to conduct the proceedings in the manner it considers appropriate. Further, Section 19(4) of the Arbitration Act provides that the power of the Arbitral Tribunal under Section 19(3) includes the power to determine the admissibility, relevance, materiality and weight of any evidence.

 

Order VIII of CPC

Order VIII Rule 3 Denial to be specific: This rule emphasizes that it is mandatory for the defendant to deal specifically with each allegation while denying the same. It focuses on the necessity of clear and explicit denial to counter allegations effectively.

Order VIII Rule 4 Evasive Denial: This rule amplifies the consequences for the failure to give a reasoned denial. It lays down that bare/evasive denials cannot be considered as denials.

Order VIII Rule 5 Specific Denial: Building up on the foundation laid down in Rule 3 and Rule 4, this rule lays down that if the denials are not specific in the pleading, they are deemed to be admitted.

 

Order XI, Rule 4 of CPC (Admission and denial of documents)

Sub-rule (1) of Rule 4 states that each party shall submit a statement of admissions or denials of all documents disclosed and of which inspection has been completed within 15 days of such inspection or at a later date as decided by the Court.

Sub-rule (2) of Rule 4 stipulates that the parties shall explicitly set out where they are admitting or denying,

  1. correctness of contents of a document.
  2. existence of a document.
  3. execution of a document.
  4. issuance or receipt of a document.
  5. custody of a document.

Sub-rule (3) of Rule 4 stipulates that bare and unsupported denials shall not be deemed to be denials of a document and proof of such documents may then be dispensed with at the discretion of the Court.

Sub-rule (4) of Rule 4 provides that for third party documents, parties may submit bare denials on account of no personal knowledge.

Sub-rule (5) of Rule 4 provides that an Affidavit in support of the statement of admissions and denials shall be filed confirming the correctness of the contents of the statement.

 

Section 30 read with Order XVIII, Rule 4 of CPC

Section 30 empowers the Court to,

  1. make such orders as may be necessary or reasonable in all matters relating to the delivery and answering of interrogatories, the admission of documents and facts, and the discovery, inspection, production, impounding and return of documents or other material objects producible as evidence;
  2. issue summonses to persons whose attendance is required either to give evidence or to produce documents or such other objects as aforesaid;
  3. order any fact to be proved by affidavit.

Order XVIII, Rule 4 provides that in every case, the examination-in-chief of a witness shall be on Affidavit and copies shall be supplied to the opposite party by the party who calls him for evidence.

 

Order XIX of CPC

Order XIX, Rule 1 provides that Court may order that any particular fact or facts may be proved by Affidavit.

Order XIX, Rule 2 provides that upon any application evidence may be given by affidavit, but the Court may, at the instance of either party, order the attendance for cross-examination of the deponent.

Order XIX, Rule 3 provides that Affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted: provided that the grounds thereof are stated.

Order XIX, Rule 6 provides for guidelines of Affidavit of Evidence.

Since the evidence submitted through Affidavit cannot be relied upon without the cross-examination of the respective witness, the Evidence Act also attains equal importance in an arbitration proceeding.

 

What amounts to Admissions in Pleadings under Order VIII?

The precision of pleadings and strategic response to allegations in the pleadings hold paramount importance within the framework of any adjudication proceedings. The Civil Procedure Code, 1908 under Order VIII Rules 3, 4 and 5 emerge as crucial provisions in aspects governing the treatment of admission within pleadings. To understand the subtlety of these rules is essential for all legal practitioners. It is trite law that allegations not specifically denied shall amount to admissions.

The Hon’ble apex Court in Gian Chand and Brothers and Ors. v. Rattan Lal [2] while deciding on whether an attempt can be made to adduce evidence on pleadings that have only total an evasive denial has held that it is obligatory on the party to specifically deal with each allegation in the plaint and when the Defendant denies any such fact, he must not do so evasively but answer the point of substance. It is clearly postulated therein that it shall not be sufficient for a Defendant to deny generally the grounds alleged by the Plaintiffs, but he must be specific with each allegation of fact. The Court held that but where there is total evasive denial and an attempt has been made to make out a case in adducing the evidence, is not permissible.

 

What amounts to Admissions of contents of a Document?

The process of admissions simplified the process of proving certain legal facts and also in eliminating facts that are not a dispute amongst the parties that come for redressal. It is established under the Evidence act, that documentary evidence is paramount and oral evidence cannot controvert/deny the facts proved by the documentary evidence. The question that arises herein, is that when a party states a document to be “admitted” in the affidavit of Admission and Denial, submitted under Order XI Rule 4, also admits to all the content that such document contains. The following courts have clarified the said legal conundrum:

The Karnataka High Court in K.M. Venkataraman and Ors. vs. G. Narayana and Ors.[3] has held that “It is trite law that admission is the best piece of evidence and admission of a document means admission of facts contained in the document.”

The Calcutta High Court in Dalgreen Agro (P) Ltd. v. Sk. Asadur Rahman[4] has clarified that Section 58 read with the amended provisions of Order XI, Rule 4 leads to the inescapable conclusion that the objective of a detailed Statement of admission and denial accompanied by an Affidavit confirming the correctness of such Statement is to do away with the rigours of proving the documents which already form part of the affidavit of evidence. The five heads provided under sub-rule (2) of Order XI Rule 4 gives the right as well as sufficient opportunity to a party to decide whether a document should be admitted or denied under any of the heads provided. But once the party exercises that right and submits a statement together with an Affidavit vouching for the stand taken by it, that party cannot insist upon a further right to call for further proof of those documents in examination in-chief.

 

What amounts to Admission when the witness has not been cross-examined on facts?

The 1994 decision of the Bombay High Court in Bhika Cullianji and Co. v. Avon Electric Company and Ors. recognised that the challenge to oral evidence must be reflected in the course of cross-examination. As the Defendants therein declined to put the material setting out their case in the cross-examination, the Court observed that the same would be regarded as an admission and such uncontroverted evidence must be acted upon by the Court[5].

In Muddasani Venkata Narsaiah (D) through Legal Representatives v. Muddasani Sarojana[6], the apex Court has held that effect of non-cross-examination is that the statement of a witness has not been disputed and if no questions are put to a witness, the Court would presume that the witness account has been accepted. The Court has further recognised that the matters sworn to by one party in the pleadings not challenged either in pleadings or cross-examination by other party must be accepted as fully established[7].

Further, in Black Ticket Films v. Walter Philip & Ors.[8] the Bombay High Court has held that if there was no cross-examination of the witness on any part of the deposition of the witness examined by the plaintiff, it amounts to admission of those facts deposed by the witness and the other party. In this case, the Claimant’s witness was not cross-examined by the Defendant on various parts of examination in chief and cause of action. Although few suggestions were put to the witness, no independent evidence was led by the Defendants to prove the case of the defendants before the Court. In view of the same, it was held that the evidence of the Plaintiff stood admitted and proved.

 

Conclusion

Admissions both under the Civil Procedure Code, 1908 and the Indian Evidence Act, 1872 are pivotal in shaping the outcome of legal proceedings. Admissions serve as a key piece of evidence that can significantly influence the decision of the person adjudicating the dispute. Therefore, parties and especially legal practitioners must navigate admissions with mindfulness and attention to details and understand the complexities and consequences of such admissions.

 

[1] Srei Infrastructure Finance Ltd. v. Tuff Drilling Pvt. Ltd. (2018) 11 SCC 470 (Para 17, 26 and 27).
[2] Gian Chand and Brothers and Ors. v. Rattan Lal AIR 2013 SC 1078, para 22-24
[3] K.M. Venkataraman and Ors. v. G. Narayana and Ors. 2012 (94) ALR 895, Para 14.
[4] Dalgreen Agro (P) Ltd. v. Sk. Asadur Rahman 2020 SCC OnLine Cal 3284, Para 9, 10.
[5] Bhika Cullianji and Co. v. Avon Electric Company and Ors. 1994 SCC Online Bom 88, Para 3.
[6] Muddasani Venkata Narsaiah (D) Lrs. v. Muddasani Sarojana (2016) 12 SCC 288.
[7] Para 16, Muddasani Venkata Narsaiah (D) Lrs. v. Muddasani Sarojana (2016) 12 SCC 288.
[8] Black Ticket Films v. Walter Philip & Ors 2017 SCC ONLINE BOM 5368, Para 72.

 

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