OMKAR TEXTILE MILLS PRIVATE LIMITED v. HARDIK CHEMICALS
1995-03-08
M.S.PARIKH
body1995
DigiLaw.ai
M. S. PARIKH, J. ( 1 ) THIS Revision Application, though filed against the impugned order dated 22-3-1990, takes within its sweep also the order dated 31-12-1990. The facts of the proceeding between the parties, therefore, need be stated : the opponent being the plaintiff filed Summary Suit No. 4747 of 1988 in the ahmedabad City Civil Court for recovery of Rs. 1,47,600. 00 with cost and interest from the applicant-defendant taking recourse to the provision of Order 37 of the Code civil Procedure. Upon the service of summons and upon the appearance of the applicant, who is hereinafter described as defendant, the opponent (plantiff, as described hereunder) had taken out the Summons for Judgment and the defendant applied for leave to defend the suit. After hearing both the parties the learned chamber Judge granted leave to defend the suit to the defendant on condition that the defendant would deposit Rs. 25,000. 00 within six weeks from the date of the order, viz. , 27th July 1989. It is undisputed that the defendant had filed Civil Revision application No. 949 of 1989 against the said order on or about 19-9-1989 and the said Civil Revision Application was rejected on the same day. In the mean time as the time to deposit the amount expired, extension was sought on two occasions and on each of the occasions extension of one week was granted. The plaintiff had taken out Certificate of non-payment/non-compliance of the order of conditional leave by virtue of Rule 147 of the City Civil Courts Rules and such Certificate was granted on or about 21-9-1989, and on the next day, i. e. , on 22-9-1989 the matter was notified for passing ex-parte decree on account of non-compliance of order for conditional leave to defend. It is the case of the defendant that the defendants learned advocate could not attend the matter and a decree was passed as prayed for by the plaintiff on 22-9-1989. It is also the case of the defendant that defendant came to know about this ex-parte decree on or before 16-11-1989. The defendant, therefore, filed Civil Misc. Application No. 811 of 1989 in the City Civil Court under Order 38, Rule 4 read with Sec. 151 of the C. P. C. for setting side the ex-parte decree. The defendant also deposited the amount of Rs. 35,000.
The defendant, therefore, filed Civil Misc. Application No. 811 of 1989 in the City Civil Court under Order 38, Rule 4 read with Sec. 151 of the C. P. C. for setting side the ex-parte decree. The defendant also deposited the amount of Rs. 35,000. 00 being the amount to be deposited as directed by this Court. The application was fixed for final hearing on 22-3-1990, however, the defendant upon inquiry in the office of the trial Court came to be informed that the said Application was fixed for hearing on 4-4-1990, but the trial Court passed an order rejecting the said application ex-parte on 22-3-1990. This is the impugned order. The defendant, however, moved another application being Civil Misc. Application No. 281 of 1990 in the trial Court under Sec. 151 of the C. P. C. for setting aside the order passed by the City Civil Court, ex-parte in Civil Misc. Application No. 811 of 1989. The Civil Misc. Application No. 281 of 1990, so moved, was rejected by the City Civil Court as per its order dated 31- 12-1990 on the ground that the remedy for the applicant would have been to file an Appeal or a revision application against the order passed in Civil Misc. Application no. 811 of 1989 and not by way of filing an application for setting aside the exparte order passed in Civil Misc. Application No. 811 of 1989. This is how the defendant has challenged the impugned order dated 22-3-1990 passed in Civil misc. Application No. 811 of 1989 claiming exemption from the Law of Limitation by virtue of Sec. 14 of the Limitation Act, on the ground that the defendant had been bona fidely procecuting his remedy with due diligence before the same Court. ( 2 ) AFTER this revision application has been admitted and interim relief has been granted it has been placed for final hearing before this Court. ( 3 ) THE challenge to this revision application is on three grounds : Firstly, it is sought to be assailed on the ground that it is not maintainable; secondly, it is barred by limitation, and thirdly, on the ground that the defendant failed to show special circumstances as contemplated under Order 37, Rule 4 C. P. C. All these defences shall be dealt with in the background of the facts as aforesaid.
( 4 ) IT has been submitted by Mr. Modi, learned Advocate appearing on behalf of the plaintiff that after decree was passed there was no remedy open to the defendant except to file Civil Appeal against the same inasmuch as decree passed on account of non-compliance of the order of conditional leave would be a decree passed bi-parte. In support of his submission Mr. Modi has placed reliance upon a decision of the Bombay High Court in the case of M/s. D. Shanalal and Etc. v. Bank of Maharashtra, reported in AIR 1989 Bom 150 . Mr. Modi also placed reliance upon a decision of the Honble Supreme Court in the case of Shah Babulal khimji v. Jayaben, reported in AIR 1981 SC 1786 . Mr. Modis pointed submission is on the word "judgment" which has been considered by the Supreme Court as well as Bombay High Court. It is consequent upon the consideration of the word "judgment" that the remedy of Appeal has been held available to the aggrieved party by virtue of the relevant clauses of Letters Patent in so far as the case of shah Babulal (supra) is concerned, and by virtue of Order 37, Rules 2 and 3 of the c. P. C. in so far as decision of the Bombay High Court in the case of M/s. D. Shanalal (supra) is concerned. Mr. Modi, learned Advocate read before me the decision of the Bombay High Court. However, he fairly submitted that there are observations in Para 7 of the citation which would indicate that there are some similarities between the procedure of the suit which becomes ex-parte by reason of the default on the part of the defendant and that of a Summary Suit under Order 37 of the Code in which the defendant either did not apply for leave or leave to defend was refused to him or having obtained leave did not furnish the security and, therefore, was precluded from contesting the suit. Mr.
Mr. Modis attention, therefore, was drawn to the provision contained in Rule 4 of Order 37, which reads as under :"after decree the Court may, under special circumstances, set aside the decree and if necessary stay or set aside execution, and may give leave to the defendant to appear to the summons and to defend the suit, if it seems reasonable to the Court so to do, and on such terms as the Court thinks fit. " ( 5 ) ON a plain reading of the aforesaid provision it becomes clear that the powers of the very Court which passed decree to set aside the decree are of very wide amplitude and can be exercised not only when there was no service of summons but also when there was sufficient cause for non-compliance of the conditional leave order. The Legislature has not used the word "ex-parte" but has referred to the word decree as contemplated in the preceding Rules. ( 6 ) MR. Amin, learned Advocate has made a reference to the decision of bombay High Court in the case of Ramchandra Dhondu Dalvi v. Vithaldas gokuldas, reported in AIR 1964 Bombay 251. The Division Bench of the Bombay high Court ruled that the power of the Court under Rule 4 to set aside ex-parte decree is not limited to those cases where the decrees are passed on the ground of defendants failure to appear in anwer to the summons for judgment. The power extends to any ex-parte decree passed in a Summary Suit under Rule 2 (2 ). The observation referred to from the decision in the case of M/s. D. Shanalal (supra) relied upon by Mr. Modi would amply support the remedy of preferring an application under O. 37, Rule 4 being available to the defendant who would face the decree by virtue of Order 37, Rule 2 and 3. Simply because the remedy of First appeal is available to the defendant to challenge such a decree on merits before the appellate Court it cannot be said that the remedy available under Rule 4 Order 37 is snapped. Such a finding is uncalled for if Rule 4 is borne is mind. In that view of the matter the sumission of Mr. Modi that the application before the very court for setting aside the decree would not be maintainable, cannot be accepted.
Such a finding is uncalled for if Rule 4 is borne is mind. In that view of the matter the sumission of Mr. Modi that the application before the very court for setting aside the decree would not be maintainable, cannot be accepted. xxx xxx xxx xxx xxx ( 7 ) THE brings me to the consideration of the special circumstances as envisaged by Rule 4 for the purpose of recalling the decree. The dates noted above assume great deal of importance in appreciating the case which the defendant has sought to present in this matter. It is no doubt true that the defendant failed to comply with the order within the time fixed by the trial Court. It is also no doubt true that the defendant did not comply with the order within extended time, but having worked out the time gap between its expiry and its possible communication to the defendant it clearly appears to me that defendant had no opportunity either to abide by the order or to communicate to his Advocate for further extension. It is in the backdrop of such a situation that the facts set out by the defendant in his application for setting aside the ex-parte decree may be considered. It is no doubt true that what the defendant is required to satisfy the Court is existence of special circumstances for setting aside the decree and that is not to be equated with reasonable and sufficient case. It can be seen that the ground canvassed by the defendant in the application is that on 21-9-1989 the mother-in-law of the defendants Advocate was suffering from cancer and she was admitted in Civil Hospital and, therefore, he could not remain present when the decree was passed ex-parte. In this connection the learned Advocate Mr. Bulani had filed his own affidavit. What the learned trial Judge has said is that this cause has no relevance and in my opinion the learned Judge has here failed to exercise the jurisdiction vested in him under Order 37, Rule 4 of the C. P. C. The presence of the learned Advocate was obviously required even when the decree was sought on the ground of non-compliance of the order of conditional leave.
By virtue of the procedure under the relevant rules of the City Civil Court Rules, the matter was required to be notified for that purpose and was in fact notified for that purpose. It cannot be gainsaid that the scope of hearing the defendant would be limited to either the extension of time for some justifiable cause or to say that the amount came to be deposited though late. The defendant had undertaken the remedy by or before the time fixed by the Court expired. It could, therefore, hardly be said that he deliberately did not deposite the amount as per the order of the Court. In fact, he could say that he followed remedy of revision available to the defendant. This is one circumstance which should weigh with the Court. It is obvious that information about the dismissal of his revision application should reach the defendant so as to enable communication of that fact to his learned Advocate, that is the second circumstance. On the other hand, the defendant did not know why the trial Court Advocate could not remain present on the relevant dates. This is the third circumstance. It is a fact that the defendant had deposited Rs. 35,000. 00 before the trial Court. It appears that the defendant was to comply with the condition of depositing Rs. 25,000. 00, whereas he has deposited Rs. 10,000. 00 more pursuant to the order passed by this Court. Even then there is grievance made by Mr. Modi that the defendant had intentionally delayed the deposit and this would show want of bona fide. In order to verify whether the defendant lacks bona fides he was called upon to show whether he would deposit the whole amount. However, while expressing his inability to deposit the whole decretal amount the defendant impressed to deposit further sum of Rs. one lac in the trial Court. The cumulative effect of all these circumstances is that the defendant cannot be said to be lacking bona fides. ( 8 ) MR. Modi has made reference to a decision of the Rajasthan High Court in the case of Mohan Lal v. Om Prakash, reported in AIR 1989 Rajasthan 132, wherein a learned single Judge of the Rajasthan High Court held that the words "special circumstances" used in Order 37, Rule 4 cannot be equated with the words "sufficient cause".
Modi has made reference to a decision of the Rajasthan High Court in the case of Mohan Lal v. Om Prakash, reported in AIR 1989 Rajasthan 132, wherein a learned single Judge of the Rajasthan High Court held that the words "special circumstances" used in Order 37, Rule 4 cannot be equated with the words "sufficient cause". The words "special circumstances" used in Order 37, Rule 4 are not synonymous. It is true that the gravity of the reason or the ground or the cause set out in an application under Order 37, Rule 4 would be higher than the gravity of cause as would be required to be set out under Order 9 Rule 13 of the C. P. C. It is from this point of view that the Rajasthan High Court has held that when the defendant assigned the cause it might not amount to special circumstances as contemplated by an Order 37, Rule 4 of the C. P. C. In my opinion on the facts of the present case, the defendant has made out special circumstances. The standard of what would amount to special circumstances and what would not would depend obviously upon the facts of each case. In that view of the matter the decision in Mohanlals case (supra) would not help the plaintiff. xxx xxx xxx xxx xxx rule made absolute to the aforesaid extent with no order as to costs. .