PURI AGRO INDUSTRIAL CORPORATION v. NAHAN FOUNDRY LTD.
1983-07-26
V.P.GUPTA
body1983
DigiLaw.ai
JUDGMENT V. P. Gupta J.—M/s Puri Agro Industrial Corporation, Jalandhar City (hereinafter referred to as the petitioner) has filed this application under Order 9, Rule 13 read with Section 151, C. P. C. for setting aside the ex-parte decree dated 9-1-1979 passed in C.S. No. 16 of 1978 {M/s. Nahan Foundry Ltd. v M/s Puri Agro Industrial Corporation, Jalandhar City). 2. The facts in brief are that the disputes between the parties were referred to arbitration of Shri Basant Rai jain (Arbitrator) retired Deputy Commissioner, Nahan for adjudication. The arbitrator gave his award on 31-3-1978, This award was filed in this Court on 28-4-1978 for being made a rule of the court. Notices were issued to the parties about the filing of the award. (M/s Nahan Foundry Ltd. Nahan (hereinafter respondent) appeared before this court on 30-8-1978. The petitioned was not served and it was ordered that notices be issued to the petitioner by registered post. On 22-12-1978 an order was passed to the effect that the petitioner had been served by registered AD, post but none was present on behalf of the petitioner. The matter was ordered to be listed on 30-12-1978. 3. On 9-1-1979 an order was passed in the following terms :— "Present : Shri K.D. Sud counsel for the petitioner. None is present for the respondents, although they have been served about the filing of the award and the period of filing the objections has also since been expired. Therefore, in these circumstances, the award, dated 31st March, 1978 is made a rule of the Court and a decree in terms of the award for Rs. 72,930.53 with interest at the rate of 9% per annum from the date of the award till the date of the recovery of the amount is passed in favour of M/s Nahan Foundry Limited, Nahan, petitioner against M/s Puri Agro Industrial Corporation, However, the parties are left to bear their own costs. This disposes of the case finally," 4. This application was filed on 23-2-1979 through Shri S.K. Puri, one of the partners of the petitioner-firm. It is alleged in the application that the petitioner came to Simla on 13-2-1979 in connection with some work and went to the High Court in search of a friend who had promised to meet him in the High Court.
This application was filed on 23-2-1979 through Shri S.K. Puri, one of the partners of the petitioner-firm. It is alleged in the application that the petitioner came to Simla on 13-2-1979 in connection with some work and went to the High Court in search of a friend who had promised to meet him in the High Court. During this visit he looked at the notice board of the High Court and found that a notice had been fixed with respect to the preparation of a decree in C.S. No. 16 of 1978, It is alleged that the petitioner had no knowledge of the proceedings in this Court and that no notice of C.S. No. 16 of 1978 was ever served upon the petitioner. The petitioner as certained the facts and came to know that an ex-parte decree had been passed on 9-1-1979, It is alleged that the petitioner firm had ceased to exist and function and had no office anywhere in Himachal Pradesh or in any other place. It is also alleged that for the last six years, the partners of the petitioner firm had shifted to Calcutta and they did not live or carry on business anywhere in Himachal Pradesh or Punjab and as such there was no question of their being served. On these allegations the petitioner prayed that the ex-parte decree be set aside. 5. It may be mentioned that the High Court was closed from 13-1-1979 till 22-2-1979 and 23.2.1979 with the first opening day. 6. Notice of this application was sent to the respondent. The application is contested on the ground that the same is barred by time. It is also alleged that the petitioner has mis-stated the facts and has not filed the application with clean hands. The respondent also alleges that there are no sufficient grounds to set aside the ex-parte decree. The petitioner had full knowledge of the proceedings and was duly served but did not appear in court despite due service. 7. On the pleadings of the parties, the following issues were framed on 27-8-1979 :— 1. Whether the application is within time ? 2. Whether the application is maintainable ? 3. Whether there is sufficient cause to set aside the ex-parte decree passed by the Court ? Issue No. 1 8.
7. On the pleadings of the parties, the following issues were framed on 27-8-1979 :— 1. Whether the application is within time ? 2. Whether the application is maintainable ? 3. Whether there is sufficient cause to set aside the ex-parte decree passed by the Court ? Issue No. 1 8. An application to set aside an ex-parte decree is to be filed within 30 days from the date of decree or where the summons or notice was not duly served, when the applicant had the knowledge of the decree. The award was made the rule of the court on 9-1-1979. The High Court closed for winter vacation on 13-1-1979 and reopened on 26-2-1979. For the purpose of the Registry the office opened on 23-2-1979. The period of limitation of 30 days expired during the vacation, therefore, the present application is within time. This issue is decided in favour of the petitioner. Issue No. 2 9. The application has been filed by one of the partners of the petitioner, A partner is competent to file an application on behalf of the firm. Shri S.K. Puri has filed an affidavit that he is a partner of the firm. In these circumstances, the present application is maintainable. This issue is decided in favour of the petitioner. Issue No. 3 10. Both the counsel admit that objections to the award could only be filed within 30 days of the notice of the filing of the award. In these circumstances the only point for consideration is as to whether the petitioner was duly served with the notice of the filing of the award or not and if he was duly served then what was the date of such service. 11. Shri S.K. Puri (PW 1) a partner of the petitioner-firm, has stated that he along with his brother I.M. Puri and K.N. Puri were the partners of the petitioner-firm which was dissolved about six or seven years ago (that is, in 1972-73). The office of this firm used to be on G.T. Road Civil Lines, Jalandhar and the premises were vacated at the time of dissolution. He along with K.N. Puri shifted to Calcutta but I.M. Puri shifted to Bangalore.
The office of this firm used to be on G.T. Road Civil Lines, Jalandhar and the premises were vacated at the time of dissolution. He along with K.N. Puri shifted to Calcutta but I.M. Puri shifted to Bangalore. He further states that the acknowledgement receipt marked A (now Ex RW 1/K) does not bear his signatures or the signatures of his partners, but the address of the firm as given in this acknowledgement receipt is the correct address of the petitioner-firm. He also states that -he came to know about the ex-parte decree for the first time on 13-2-1979. 12. During cross-examination he stated that he had not brought the dissolution deed of the firm and that the premises occupied by the firm as a tenant were owned by Milkha Singh landlord 13. The court vide order dated 21-9-1979 directed the witness to produce the partnership deed as also the dissolution deed of the petitioner-firm. The witness was also asked to produce the account books of the last year when the firm was alleged to have been dissolved. The case was adjourned for the remaining cross-examination of the witness. 14. This witness was again cross-examined on 29-4-1983, In cross-examination the witness has stated that he had engaged Shri Dharam Parkash Gupta, Advocate Nahan as his counsel in the arbitration proceedings, and that he did not remember if any notice was served upon him by the arbitrator at the address, 4 Dada Nagar, Jalandhar. He admitted that the address of the petitioner firm was G.T Road, Civil Lines, Jalandhar. He further stated that the dissolution deed of the firm was with one of the partners, who was not on speaking terms with him. Regarding the accounts of the partnership he stated that some of the accounts had been settled but all the accounts had not been settled. He did not give any reply to the question as to who was in possession of the account books of the partnership. The witness admitted that he had an ancestral house in Basti Ganj Jalandhar, and that his brother Sukesh Puri and mother lived in that house. He also admitted that his wife owned a house at 4, Dada Nagar, Jalandhar City and that he had kept two rooms for his use in this house, where he used to stay during his visits to Jalandhar.
He also admitted that his wife owned a house at 4, Dada Nagar, Jalandhar City and that he had kept two rooms for his use in this house, where he used to stay during his visits to Jalandhar. He expressed his inability to identify the signatures of his brothers I.M. Puri and K.N. Puri although acknowledgements and affidavit purporting to bear signatures of I.M Puri were shown to him. He admitted that on 6-9-1976 his residential address was, 4, Dada Nagar, Jalandhar City and that he had engaged Shri Devinder Gupta, Advocate Simla as his counsel in O.M P. No. 60 of 1976 and further stated that the addresses of the partners given in Ex. R-3 were given by him. He also stated that 5 or 6 persons were employed in the office of the petitioner-firm but he did not remember the names and addresses of those employees. He stated that he had been making enquiries about the arbitration proceedings from his counsel Shri Dharam Parkash Gupta within a period of 5/6 months prior to 13-2-1979 and that Shri Dharam Parkash Gupta did not send him any information about the arbitration proceedings He met Shri Dharam Parkash Gupta one or twice within this 5/6 months period and Shri Dharam Parkash Gupta informed him that the arbitration proceedings were in progress. He did not answer the question as to whether he met Shri Dharam Parkash Gupta a few days before 13-2-1979 or a few months before 13-2-1979 The witness admitted that the office of the petitioner-firm was opposite the Nehru Garden Jalandhar but he did not remember if any Dasu Ram was an employee. He stated that no registered letter was received by any of his agents or members of his family containing the notice for filing the objections. The demeanour of the witness was noted by the court to the effect that he was avoiding to give straight replies to many questions. 15. Shri Pritam Singh (RW 1) appeared for the respondent. He stated that the application (copy of which is Ex. RW 1) was filed by Shri Dharam Parkash Gupta counsel for the petitioner along with a medical certificate (copy of which is Ex. RW 1/B) He also proved Ex. RW 1/D, copy of another application dated 6-2-1978 filed by Shri Dharam Parkash Gupta.
He stated that the application (copy of which is Ex. RW 1) was filed by Shri Dharam Parkash Gupta counsel for the petitioner along with a medical certificate (copy of which is Ex. RW 1/B) He also proved Ex. RW 1/D, copy of another application dated 6-2-1978 filed by Shri Dharam Parkash Gupta. He stated that notices were sent to the petitioner for filing objections to the award and proved the postal acknowledgement receipt Ex RW 1/K showing that the registered letter containing the notice was received by the petitioner. 16. Shri Inder Singh, Advocate for the petitioner contended that the petitioner-firm was not in existence in 1978 and the notices were never served. He further contended that the petitioner had a right of being heard and on the principles of equity the ex-parte proceedings should be set aside. He relied upon Ex-A-2 (copy of an order dated 26-8-1978) and referred to Gurbachan Singh v. Dharam Samaj Society, [AIR 1981 All. 208] and Shiv Dutt Singh v. Ram Dass, [AIR 19:0 All, 280], 17. Shri K.D. Sud, Advocate for the respondent contended that the petitioner had been duly served and no objections to the award were filed within the statutory period of 30 days. For this reason the orders regarding the ex-parte proceedings and the decree were not liable to be set aside. 18. Ex. A-2 is a copy of the order dated 26.8.1977 passed by the Assessing Authority Jalandhar. It only proves that according to the affidavit of the petitioner (dealer) no business was conducted during the period of assessment year 1977-78 and the case for sale tax was filed, as this fact of closure of business was also verified. The petitioner had applied for cancellation of registration certificate which was cancelled on 26-8-1977. It was an unilateral act of the petitioner-firm, i 19. The arbitrator took cognizance of the arbitration reference on 18-7-1974. At the earlier stages S.K. Puri, a partner of the petitioner-firm, was appearing before the arbitrator. Some evidence was also produced. When the case reached the finishing touch, an application was filed on 6-2-1978 mentioning that the petitioner-firm stood dissolved and ail the partners should be impleaded as parties and be summoned. The respondent did not admit the factum of dissolution, but agreed to get the summons issued to all the three partners.
Some evidence was also produced. When the case reached the finishing touch, an application was filed on 6-2-1978 mentioning that the petitioner-firm stood dissolved and ail the partners should be impleaded as parties and be summoned. The respondent did not admit the factum of dissolution, but agreed to get the summons issued to all the three partners. The partners were issued notices but inspite of notices S/Shri Inder Puri and K.N. Puri did not appear and ex-parte proceedings were ordered against them on 14-3-1978. On the application of K.N. Puri the ex-parte proceedings were set aside and he was asked to produce evidence but he did not produce any evidence. On 23-3-1978 S.K. Puri as well as his counsel absented themselves with the result that ex-parte proceedings were also ordered against him. The arbitrator finally gave his award on 31-3-1978. This award was filed in court by the arbitrator on 28^-1978. Notices of the same were ordered to be sent to the parties on 30-5-1978. A notice was sent to the petitioner on Jalandhar address for 30-8-1978, but the notice was received back with the report that the address was incomplete. Vide order dated 30.8.1978 fresh summons wore ordered to be served upon the petitioner through registered post. These notices were sent for 25-10-1978 but the same were also received back unserved. The court again ordered for issuance of fresh notices by registered post A notice was sent to the petitioner by registered post. This notice was delivered on 29-11-1978, The address on the acknowledgement due Ex. RW 1/K was : Puri Agro Industrial Corporation. Opposite Nehru Garden, Jalandhar City. As the acknowledgement receipt was received back and the notice had been delivered, therefore, ex-parte proceedings took place and an ex-parte decree was passed on 9-1-1979. 20. In Gurbachan Singh (supra) a notice was sent by the landlord under Section 106 of the Transfer of Property Act, terminating the tenancy of the tenant. The receipt of the notice was denied by the tenant. The notice was sent to the tenant by registered post. The postal envelope was received back with an endorsement that the tenant had refused to receive the letter. The tenant appeared in the witness box and stated that he was never served with any notice and he never refused to accept the notice. The statement of the tenant was not challenged in cross-examination.
The postal envelope was received back with an endorsement that the tenant had refused to receive the letter. The tenant appeared in the witness box and stated that he was never served with any notice and he never refused to accept the notice. The statement of the tenant was not challenged in cross-examination. In these circumstances, it was held that the landlord should have produced evidence to rebut the statement of the tenant. This judgment is distinguishable because if a notice is received back by the sender with an endorsement "refused" then a mere statement of the addressee may be considered to be sufficient to rebut the presumption, v On the other hand if a notice is delivered on the address of the addressee, then in that case heavy onus will be on the addressee to prove that the said notice was never delivered to him. In Shiv Dutt Singh (supra) the facts were similar to the facts of the case of Gurbachan Singh (supra). In fact in the case of Gurbachan Singh (supra) this judgment of Shiv Dutt Singh (supra) was relied upon, 21. In the present case S.K. Puri (PW 1) has admitted that the office of the petitioner was opposite Nehru Garden Jalandhar, He also admitted that his family members reside at 4 Dada Nagar, Jalandhar and that his ancestral house is in Basti Gujan Jalandhar. He admitted Ex. R-l dated 6-2-1978 in which the addresses of all the three partners are of Jalandhar. In Ex. R-3 dated 17-3-1977 (reply filed by Shri S.K. Puri) the addresses of the three partners were of Jalandhar. In the assessment order Ex. A-2 dated 26-8-1977 the address of the petitioner is of Jalandhar, 22. From the above evidence it is proved that the petitioner firm was carrying on the business at Jalandhar and the three partners were also living at Jalandhar. No information regarding the change of addresses was ever given to the arbitrator or to the court. In these circumstances, notices could only be issued to the petitioner firm upon Jalandhar address. As the notice by registered post was sent on Jalandhar address, therefore, I hold that the notice was sent to the petitioner firm upon correct address. 23. It is not proved as to who received the registered letter containing the notice. Some person who signed the acknowledgement receipt Ex. RW 1/K has received the notice.
As the notice by registered post was sent on Jalandhar address, therefore, I hold that the notice was sent to the petitioner firm upon correct address. 23. It is not proved as to who received the registered letter containing the notice. Some person who signed the acknowledgement receipt Ex. RW 1/K has received the notice. The petitioner firm had two more partners, that is, Inder Puri and K N. Puri, They have not appeared in the witness box with the result that an adverse inference has to be drawn against them. S.K. Puri (PW 1) stated that the acknowledgement Ex. RW 1/K did not bear his signatures or the signatures of his partners However, in cross examination he stated that he was not in a position to identify the signatures of Inder Puri or K.N. Puri. In these circumstances, the possibility cannot be excluded that the acknowledgement was signed by Inder Puri or K.N. Puri Further, the service upon a firm could be effected at the principal place at which the partnership business was carried on within India, upon any person having at the time of serving the control or management of the partnership business there. The place of business known to the arbitrator or the court at the time of issuance of the notice was Jalandhar and the address of Jalandhar was only available with the court. In these circumstances, if the notice had been sent at the correct address then the service upon a person who received the registered notice on behalf of the petitioner was sufficient service. Shri S.K. Puri (PW 1) did not depose the names of his employees or agents, because the service upon an agent of a firm is also a sufficient service. The respondent could only prove that the registered letter was sent on the correct address of the petitioner and if the same was delivered, then the presumption would be that it was served upon the petitioner. 24. Under Section 114, Illustration (f), of the Indian Evidence Act the court may presume that the common course of business has been followed in particular case, i.e. if a letter is shown to have been posted, then in the common course of business it will be deemed to have been delivered to the addressee.
24. Under Section 114, Illustration (f), of the Indian Evidence Act the court may presume that the common course of business has been followed in particular case, i.e. if a letter is shown to have been posted, then in the common course of business it will be deemed to have been delivered to the addressee. Similarly, under Section 27 of the General Clauses Act, if a document is required to be served by post then the service shall be deemed to be effected by properly addressing prepaying, and posting by registered post a letter containing the document. 25. In Hari Ear Banerji v. Ramshashi Roy, [A.I.R. 1918 P.C. 102], it is observed that the personal tender or delivery of the notice may take place anywhere, the vicarious tender or delivery must take place at the residence of the person intended to be bound by the notice. In the case of joint tenants each is intended to be bound, and service of a notice to quit upon one joint tenant is prima facie evidence that it has reached the other joint tenants. In this case a notice to- quit was sent to three defendants who were members of a joint Hindu family be registered post. All the three were sent separate notices. The receipts regarding the delivery of notices were received back and the acknowledgement receipts were signed by persons other than the addressees. It was held that if the notices were enclosed in a letter which they had put into the post correctly addressed, then it is presumed that the letter reached its destination at the proper time. Their Lordship further held that this presumption applies with greater force to the letter which the sender has taken the precaution to register and a receipt for the letter is produced signed on behalf of the addressee by some person other than the addressee himself. This judgment of the Privy Council is followed in Bhushan Chandra Paul and others v. M/s Bengal Coal Co. Ltd., [A.I.R. 1966 Cal. 63], wherein it is held that service of notice upon one of the joint tenants is prima facie evidence of service on the others when similar notices on all joint tenants are sent by post to the correct address.
Ltd., [A.I.R. 1966 Cal. 63], wherein it is held that service of notice upon one of the joint tenants is prima facie evidence of service on the others when similar notices on all joint tenants are sent by post to the correct address. It is further held that the service by registered post of a notice when directed to correct address is prima focie proof if the acknowledgement receipt comes back with the signatures of some body thereon. A similar view is taken in M/s M.X. de Nornha v. Commissioner of Income Tax [AIR 1952 All. 137], that a notice sent to an assessee firm by registered post properly addressed and posted pre-paid and received by an employee of the firm would raise a presumption of due service under Section 27 of the General Clauses Act. Similarly, in Madan Lal Sethi v. Amar Singh Bhalla. [1980 (2) RCJ 543], it is again held that if the acknowledgement receipt bearing the signatures of some person other than the addressee himself is produced then it will be deemed to be a sufficient service upon the addressee. Mere denial by the addressee is not sufficient to prove that the notice never reached him. 26. In the present case, I have already observed that the notice was sent on the correct address of the petitioner firm and it was delivered to some person who must have received the same on behalf of the firm. Except Shri S.K. Puri no other partner of the firm has appeared and the names of the employees of the firm have not been disclosed by S.K. Puri. This conduct on behalf of the partners of the firm clearly suggests that the notice was delivered to the petitioner firm in accordance with the provisions of law. S.K. Puri (PW 1) has tried to depose ignorance even with respect to the proved and admitted facts. He was avoiding to give straight replies to the various questions put to him in the cross examination and the court gave a note regarding his demeanour. Even during the arbitration proceedings, the petitioner or its partners absented themselves during the last stages, 27. In view of the aforesaid discussion, I hold that the petitioner was duly served and there are no grounds to set aside the ex-parte proceedings or the decree. This issue is decided against the petitioner, 28.
Even during the arbitration proceedings, the petitioner or its partners absented themselves during the last stages, 27. In view of the aforesaid discussion, I hold that the petitioner was duly served and there are no grounds to set aside the ex-parte proceedings or the decree. This issue is decided against the petitioner, 28. In view of the above discussion, the present application is dismissed with costs. Application dismissed.