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2002 DIGILAW 869 (MAD)

S. N. Mani v. Indian Overseas Bank & Another

2002-08-22

K.RAVIRAJA PANDIAN, S.JAGADEESAN

body2002
Judgment :- S. JAGADEESAN, J. The appellant is the second defendant in C.S.No.17/1992 on the file of this Court. The suit was decreed exparte as early as 16.3.1995. Against the appellant as well as the second respondent herein the said suit was filed by the first respondent-the bank for recovery of a sum of Rs.3,91,118.45. The appellant herein filed application Nos. 86 and 87 of 1997 to condone the delay of 596 days in filing the petition for setting aside the exparte decree dated 16.3.95 and for setting the said exparte decree. The appellant also filed an application No. 850/1997 seeking permission to pay 25% of the decree amount. When these applications were listed before one of us (S.JAGADEESAN,J.)for disposal, an order was passed on 2.7.1997 after securing the presence of the second respondent herein by the issue of non-bailable warrant. 2.The issue of non-bailable warrant was forced by the conduct of the second respondent herein as he refused to appear before this Court in spite of the service of summons in the application. The presence of the second respondent was insisted by this Court as it was contended by the appellant herein that he stood as a guarantor for the borrowings of the second respondent and even though the business was a joint venture, the appellant's share is only 25% and as such the appellant cannot be made liable for more than the said 25% of the debt. 3.After the issue of non-bailable warrant, the second respondent appeared before this Court and admitted that he is liable to pay 50% of the debt and the remaining 50% is to be paid by the appellant herein. When the exparte decree is being set aside at the instance of the appellant, naturally, the second respondent is also benefited by the same and accordingly his admission and undertaking of the payment of 50% was recorded by this Court in the order dated 2.7.1997 and ultimately this Court passed the following order. "5.While doing so in view of the undertaking given by the second respondent that he is willing to pay 50% of the decree amount, I impose the condition that the second respondent has to deposit 50% of the decree amount within four weeks from today. "5.While doing so in view of the undertaking given by the second respondent that he is willing to pay 50% of the decree amount, I impose the condition that the second respondent has to deposit 50% of the decree amount within four weeks from today. With regard to the remaining amount, the applicant has agreed to discharge 25% of the decree amount and the remaining 25% of the decree amount is under dispute as to the liability among the defendants. Hence 25% of the decree amount is directed to be deposited by the applicant herein within four weeks from today. So far as the remaining 25% of the decree amount is concerned, trial can be proceeded with in order to find out the veracity of the defence that has been taken by the second respondent in this case. Accordingly these applications are allowed and on such deposit, the suit is restored and the trial will be restricted with regard to the 25% one liability to the Bank among the two defendants. In case, if any default is committed it is open to the Bank to proceed against the second respondent/first defendant first to recover the decree amount and the second respondent is directed to furnish his property list within two weeks from today. Even in executing the exparte decree, in case of any default committed by the defendants, the Bank is entitled to recover 75% of the amount from the second respondent/first defendant and 25% from the applicant herein as already it has been found that the defence taken by the second respondent/first defendant is totally unacceptable one. These applications are ordered in the above terms." This order was challenged by the first respondent bank in O.S.A.Nos. 367 to 369 of 1997. The learned Division Bench which heard the appeals dismissed the same at the admission stage. Subsequently, the appellant herein filed Review Application Nos. 42 to 44 of 1999. Another Division Bench which heard the Review applications disposed of the same by order dated 15.3.2000 under the following terms: "4. We have heard the learned counsel on either side and perused the materials on record. From the facts culled out, it seems that the principal debtor has not complied with the order of the learned Single Judge and deposited 50% while setting aside the exparte Order. He is also absent before this Court, despite service. We have heard the learned counsel on either side and perused the materials on record. From the facts culled out, it seems that the principal debtor has not complied with the order of the learned Single Judge and deposited 50% while setting aside the exparte Order. He is also absent before this Court, despite service. We find no error apparent on the face of the record. However, in the interest of justice we direct the Trial Court to expedite the trial for determining the liability for 25% of the amount. In case, 50% of the decretal amount is not deposited by the Principal debtor, the Trial Court may conduct trial for 75% of the decretal amount and the decretal amount will be realised as per the Order of the Court of the Court dated 2.7.97. It is expected that the Trial Court will decide the issue within six months from today." 4.In compliance of the order dated 2.7.97, the appellant herein deposited 25%. After such compliance he filed application No.5627/2001 seeking for relieving the applicant from the suit by giving a discharge of the debt so far as he is concerned. Though in the affidavit filed in support of the said application, the applicant has prayed for the return of the documents, no separate application was filed for such relief or even in the same application no such relief was sought for. The learned Judge who heard the application had dismissed the same by order dated 5.6.2002 against which the present appeal has been filed. 5.Before we hear the appeal on merits, once again we try to get the presence of the second respondent. The presence of the second respondent was insisted in order to ascertain as to why he has totally failed to respect his own undertaking given before the Court pursuant to which the order dated 2.7.1997 was passed. The second respondent neither deposited 50% of the amount nor filed the list of his properties owned by him in compliance of the order dated 2.7.1997. When the second respondent did not file any application for setting aside the exparte decree, in fact, he is bound by the decree, but for the order dated 2.7.97 which was invited at the instance of both the appellant herein and the second respondent by their own undertaking. When the second respondent did not file any application for setting aside the exparte decree, in fact, he is bound by the decree, but for the order dated 2.7.97 which was invited at the instance of both the appellant herein and the second respondent by their own undertaking. In such circumstances, there is nothing wrong on the part of this Court to expect certain amount of respect for their undertaking from the parties. If this conduct of the second respondent is to be tolerated, then in the ordinary course any litigant will be emboldened to give an undertaking in the Court and get a timely relief without any mind to respect or comply with such undertaking given before the Court. This is nothing but abuse of process of Court. In fact, straightaway, contempt proceedings can be initiated. But, we make it clear that we are not interested in initiating contempt proceedings and punish the second respondent as we are clear in our view that he may not mind for such procedure as his conduct from the way in which he discarded his own undertaking as well as the orders passed by this Court on the basis of his undertaking without seeking any extension of time, is a clear proof of his intention to discard both. 6.But, what happened at present is that the suit is being taken up for trial in respect of 25% of the disputed liability. In our view, it is an unnecessary task for the Court to take up the trial as the order dated 2.7.1997 passed while setting aside the exparte decree at the instance of the appellant makes it is clear that only if both parties deposit the amount as undertaken by them, then only the suit is to be restored. When one of the parties has failed to comply with the conditions, the suit cannot be considered to have been restored on file to proceed with the trial. As the second respondent failed to comply with the condition imposed by order dated 2.7.1997 the exparte decree is concerned stand confirmed and the suit is not restored on file. When one of the parties has failed to comply with the conditions, the suit cannot be considered to have been restored on file to proceed with the trial. As the second respondent failed to comply with the condition imposed by order dated 2.7.1997 the exparte decree is concerned stand confirmed and the suit is not restored on file. This is explicitly clear from the terms of the order dated 2.7.97 which is as follows:- "Accordingly these applications are allowed and on such deposit, the suit is restored and the trial will be restricted with regard to the 25% one liability to the Bank among the two defendants. In case, if any default is committed it is open to the Bank to proceed against the second respondent/first defendant first to recover the decree amount and the second respondent is directed to furnish his property list within two weeks from today. Even in executing the exparte decree, in case of any default committed by the defendants, the Bank is entitled to recover 75% of the amount from the second respondent/first defendant and 25% from the applicant herein as already it has been found that the defence taken by the second respondent/first defendant is totally unacceptable one." When the 2nd respondent failed to comply with the condition the exparte decree dated 16.3.1995 stands confirmed. Hence, in our view, there is absolutely no need for the trial to be proceeded with in the suit so far as the disputed liability of 25% is concerned. 7.We are very clear in our view because in the order dated 2.7.1997 passed by one of us, it is clearly stated that if the second respondent fails to comply with the deposit of 50% of the suit liability, the bank has to proceed against the second respondent for recovery of 75% of the amount decreed or the suit claim. This order having been confirmed in O.S.A.Nos.367 to 369/1997 at the instance of the first respondent bank, the liability of the second respondent in so far as 75% of the suit claim is confirmed. When the conditional order passed on the basis of the undertaking given by the second respondent had not been complied with and the same having been not challenged by way of any appeal by the second respondent he is bound by the same. When the conditional order passed on the basis of the undertaking given by the second respondent had not been complied with and the same having been not challenged by way of any appeal by the second respondent he is bound by the same. 8.However, the Counsel for the second respondent contended that the order of the learned Division Bench in the review application had mentioned that if the 50% of the decretal amount is not deposited by second respondent then the trial to be held regarding the 75% of the decretal amount. Hence, the trial has to be proceeded with. In our view, in the review application also, the order dated 2.7.97 has been confirmed. Though the learned Bench has observed that the Trial Judge may conduct the trial for 75% of the decretal amount, in our view it is a mistake of fact. The second respondent, who has not challenged the order and who did not appear before the Division Bench in the review application, when the review application was heard, cannot be permitted to take advantage of the sentence at this stage because the next sentence that the amount will be realised as per the order of this Court dated 2.7.97 makes it clear that the 1st respondent is to recover 75% of the decree amount from the 2nd respondent. Hence, it is made clear that pursuant to the earlier order in the application for setting aside the exparte decree and the same having been confirmed by the two learned Division Benches of this Court, we hereby declare that the second respondent is liable to pay 75% of the decreed debt in C.S.No.17/92 as per the earlier orders of this Court. 9.Further from the endorsement of the learned trial judge dated 10.7.2002 it is seen that the 2nd respondent did not file any written statement. When that be so there is no need to take the suit for trial and once again pass an exparte decree as it is only a waste of the precious judicial time of the Court. 10.Before us, the second respondent filed an affidavit furnishing the list of properties and also declared that the properties furnished in the list are of free of encumbrances. The said affidavit was filed on 10.8.2002. 10.Before us, the second respondent filed an affidavit furnishing the list of properties and also declared that the properties furnished in the list are of free of encumbrances. The said affidavit was filed on 10.8.2002. On the basis of the affidavit and also having stated before us that he has no objection to proceed against the list of properties furnished in the affidavit in respect of the 75% of the decree amount as per the exparte decree dated 16.3.95 and the first respondent bank also having accepted to proceed against the properties of the second respondent herein in order to recover the liability of 75% of the suit claim, we direct the 1st respondent bank to proceed against the appellant herein as well as the second respondent for the 75% of the claim, since the 25% has already been deposited by the appellant herein. 75% of the decree amount will bear the future interest in terms of the exparte decree dated 16.3.95. The first respondent is further directed to proceed with personals as well as against the properties of the second respondent to recover the said 75% of the decree amount and in case of any deficiency the bank can proceed against the appellant herein for the balance of the said decree amount. On this ground, it is not possible for us to grant the relief sought for by the appellant herein to discharge him from the proceedings. Accordingly, the order of the learned Judge in Application No.5627/2001 is confirmed and the C.S.No.17/1997 as well as O.S.A.No.262/2002 are disposed of in the above terms. No cost.