New Delhi: The Supreme Court has reiterated that a counterclaim cannot be maintained by a defendant against co-defendants in a suit. The Court clarified that under Order VIII Rule 6A of the Code of Civil Procedure, 1908, a counterclaim can only be directed against the plaintiff and must arise from a cause of action that is incidental or connected with the plaintiff’s original claim.
Delivering judgment in Sanjay Tiwari v. Yugal Kishore Prasad Sao & Ors. [Civil Appeal @ SLP (C) No. 11050 of 2025], the Bench of Justices K. Vinod Chandran and N.V. Anjaria allowed the appeal and set aside the orders of the Trial Court and the High Court, which had permitted a counterclaim filed by co-defendants against another defendant.
The plaintiff had originally filed a suit for specific performance against the first defendant regarding 0.93 acres of land. Later, defendants 2 and 3 were impleaded upon their request and filed a counterclaim against defendant no. 1, seeking transfer of the same land in their favour. The Trial Court allowed the counterclaim, and the High Court refused to interfere, citing the need to avoid multiplicity of litigation.
The Supreme Court, however, found this legally untenable. Referring to precedents including Rohit Singh & Ors. v. State of Bihar [(2006) 12 SCC 734] and Rajul Mano Shah v. Kiranbhai Shakrabhai Patel [(2025) 10 SCR 152], the Court emphasized that a counterclaim must be directed only against the plaintiff and cannot be extended to disputes between co-defendants. It further held that a counterclaim must arise from a cause of action incidental or connected with the one on which the plaintiff’s suit is based.
The Bench observed that the counterclaim filed by defendants 2 and 3 was wholly independent of the plaintiff’s cause of action and was essentially an attempt to pursue a separate claim against another defendant. The Court clarified that while impleadment of defendants 2 and 3 was necessary to avoid non-joinder, it did not authorize them to raise a counterclaim against a co-defendant.
Accordingly, the Supreme Court set aside the counterclaim and restored the plaintiff’s suit for specific performance to proceed before the Trial Court. It also denied liberty to defendants 2 and 3 to file a fresh suit, noting that such a claim was already barred by limitation.
Case Title: Sanjay Tiwari v. Yugal Kishore Prasad Sao & Ors.
