Civil Procedure Code 1908 Set-off, Counter – Claim, Equitable Set-off
Here, we will learn a few terms of the Civil Procedure Court, 1908.
Set – Off, Counter – Claim and Equitable Set – Off :
Set – Off:
Set Off is dealt under Order 8 of Rule 6 of the Civil Procedure Code, 1908. It is a defense mechanism to a sum of money owed. It is a form of a cross – suit. Legally, it is termed as reciprocal acquittal to of debts between both the parties i.e. between the plaintiff and the defendant. It eliminates or extinguishes the claim of the plaintiff to the extent of the sum of the money claimed by the defendant as a counter claim.
In simple terms, it means when 2 parties owe money to each other but 1 among the two parties owe more money than the other than that party pays the net amount and settles the money owed.
Under Order 8 of Rule 6, where in a suit a defendant claims for the recovery of money to set off against the plaintiff’s demand any ascertained money legally recoverable by him from the plaintiff not exceeding the pecuniary limit of the Court and where both the parties fill the same character as in the plaintiff’s suit, then at the first hearing of the suit and not afterwards the defendant may present a written statement containing the particulars of the debt which is sought to be set off.
Effect of Set – Off :
Under Clause 2, the written statement shall have the same effect as a plaint in a cross-suit so as to enable the Court to pronounce a final judgment in respect of both of the original claim and the set-off. The point that shall be noted here is that it shall not affect the amount of the pleader decreed under lien, in respect of the costs payable to him under the decree.
Counter – Claim :
Counter Claim is explained under Rule 6A of Order 8 of the Civil Procedure Code, 1908. Provision of counter claim has been amended and Rule 6A to 6G has been inserted by Civil Procedure Code Amendment Act, 1976.
Counter claim is a cross action. It is a claim bought against the plaintiff by the defendant. It is a filed as a part of the defendant’s answer to the original claim. It can be made both for ascertained or even for the unascertained amount of money. It does not need to arise from the same transaction. A defendant in a suit, in addition to his pleading, set up a right or a claim against the claim of the plaintiff either before or after the filing of the suit but before the defendant has delivered his defense or before the time limited for delivering his defense has expired. The point to be considered here before filing his claim is that counter claim to file must be within the pecuniary limit of the jurisdiction.
Equitable Set – Off :
Equitable set-off is dealt under Rule 6 of Order 8 of the Civil Procedure Code, 1908. It can be made both for ascertained or even for unascertained amount of money. It needs to arise from the same transaction, or from the transactions which can be considered as one, or where there is knowledge on both sides of an existing debt due to one party and a credit by the other party. It is not a right of the party but it is at the discretion of the court but no court fee is required for the same.
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