Notice of Motion No. 1531 of 2000,Suit No. 614 of 1996

12th June, 2000

Petitioner Counsel: D.D.MADON with H.V.MEHTA, Ms. GEETA PATEL & Ms. SWAPNILA RANE i/b. A.ANKHAD
Respondent Counsel: IQBAL CHHAGLA with R.M.KADAM i/b M.RANCHODDAS & CO.

Cases Cited:
Rafiq vs. Munshilal, 1981 S.C. 1400 [Para 11]
Salil Dutta vs. T.M. & M.C. Private Ltd., J.T. 1993 (4) S.C. 528 [Para 11]
Mohanlal v. Om Prakash, AIR 1989 Rajasthan 132 [Para 12]

JUDGMENT

JUDGMENT :- Heard counsel for the Plaintiff and the Defendant.

2. This motion is taken out by the defendant mainly to set aside the ex-parte decree dated 13-7-1998 passed against the defendants in Summary Suit No. 614/96. The suit was filed by the Plaintiff for recovery of an amount of Rs.2 crores covered by three cheques said to have been issued by the defendant in pursuance of the agreement entered into between the Plaintiff and the Defendant dated 22.5.1993. The aforesaid amount was stipulated as the consideration of the expenses, remuneration and services rendered by the Plaintiff in securing 51% shares of Catholic Syrian Bank in the name of the defendant. Admittedly those cheques were dishonored and the above Suit was filed for recovery of the said amount.

3. In the affidavit in support of the Motion, the defendant sought to explain the delay and/or the grounds of his absence from the court entailing passing the ex-parte decree on 13-7-1998.

4. The writ of summons of the suit was served on the defendant on 15-4-1996. The defendant has forwarded the papers to one Mr.Menon, advocate, who was conducting the criminal cases for the defendant, which are pending. One of the criminal cases has been filed by the Plaintiff under Sec. 138 of Negotiable Instruments Act for dishonoring the suit cheques and another one was filed by the defendant against the Plaintiff under section 420 of IPC for having committed an offence of cheating in carrying out the agreement dated 22-5-1993. It is stated in the affidavit of the defendant that writ of summons received by the defendant was sent to advocate Mr. Menon, instructing him to take necessary steps to defend the matter. But Mr. Menon who is usually practicing in criminal side, did not attend to it, but kept it in his file thinking that the papers relate to criminal cases. When Mr. Menon, in June 1996, was about to undergo a bye-pass surgery, happened to open the file and realized that the papers, which was sent by the defendant relate to a civil suit and then he immediately informed the defendant and advised him to hand over the papers to any advocate practicing in civil side. Accordingly the defendant collected the papers on 18-6-1996 and entrusted the matter to M/s. Malvi Ranchoddas and Co.

5. It is further alleged in the affidavit in support of the motion, that since the time stipulated under sub Rule 1 of Rule 3 of Order XXXVII was over, the defendant would have to file vakalatnama only on consent of the plaintiff. Though no such consent was envisaged under Order XXXVII, both the counsel informed me that it is the practice of this court that with the consent of the opposite party even if there is a delay in filing the vakalatnama beyond 10 days stipulated under Order XXXVII, vakalatnama can be filed. Be that as it may the correspondence ensued between the two lawyer's firm regarding obtaining the consent to condone the delay in filing the vakalatnama.

6. First the counsel for the defendant addressed a letter on 19-6-1996 seeking consent for filing the vakalatnama after 10 days. The precipe for consent letter also has been forwarded along with that letter. No reply was sent by the counsel for the Plaintiff. Again on 24-9-1996 a letter was sent by the counsel for the defendant to the counsel for the Plaintiff reminding them that they have not forwarded the precipe after obtaining consent. To this letter also they have not sent the reply. On 24-4-1997 the counsel for the plaintiff was again addressed by sending a reminder and requesting to return the consent precipe duly signed by the counsel to enable the defendant to file vakalatnama on behalf of the defendant with a promise to send a fresh precipe in case the earlier precipe is misplaced. To this letter also no reply was received by the counsel for the defendant.

7. Thereafter there was no correspondence addressed to the Plaintiff's counsel by the defendant's counsel till 11-4-2000. On 11-4-2000 i.e. when plaintiff took steps to execute the decree, a letter was written by the counsel for the defendant. It is clear from this affidavit of the defendant at para 4 that the last letter sent by the counsel for the defendant was on 24-4-1997, and the defendant was not taking any action to persue the matter any further after 24-4-1997. According to the counsel for the defendant Mr.Chhagla the defendant was of / under bonafide belief that the plaintiff's counsel would send the preceipe to them and that the defendant was therefore waiting for the preceipe with the consent of the plaintiff and that it is in uttar shock of the defendant the news that he heard that the suit was decreed ex-parte and sought to be executed.

8. From the facts narrated above, I have no hesitation to hold that the defendant was grossly negligent in prosecuting the proceeding before this court. Of course, it may be the usual practice in this court, relying upon the consent of the advocates appearing on other side, vakalatnama could be filed but that should not have deterred the defendant to take a diligent action in prosecuting the matter. One fact remains that the defendant knows that the proceedings against him is pending before this court and he cannot therefore be in any manner lethargic, thinking that everything will be done by his counsel. It is his duty to contact his advocate every now and then and enquire about the litigation and the developments especially when parallel criminal proceedings that are going on between the parties. Considering the Stakes involved and educational status of the defendant one would expect that he must have been conversant with procedure of a Summary Suit. A person like the defendant cannot pretend ignorance of the rules relevant to this case. Moreover he must have been well advised by his counsel that he should have filed his vakalatnama within 10 days and the vakalatnama has not been filed. In this factual situation waiting indefinitely for receiving the preceipe from the opposite counsel, for filing vakalatnama shows not only the lethargic attitude of the defendant but also shows the tendency of the defendant to flout the rules and procedure.

9. I cannot agree to the submission made by Mr.Chhagla on behalf of the defendant that the defendant was bonafide believing that counsel for the plaintiff would send back the preceipe with consent for the last four years. In fact in this case even after three repeated letters, no commitment has been made by M/s. Mulla & Mulla regarding the consent being given for filing vakalatnama. Still for four years after filing of the suit, one cannot think that the opposite counsel will send a preceipe giving the consent enabling the defendant to file vakalatnama. It is to be noted here that parties were putting fierce fights in criminal courts and one such proceeding was taken up to Supreme Court. In this circumstance I can totally reject the allegation of the learned counsel for the plaintiff that the defendant is trying by his all means to delay the proceedings and to buy out time. The discretion of this court can be available only in favour of a person who has shown to this court that he was prevented from prosecuting the case for the reasons beyond his control. That is not the case in this case.

10. In this context the learned counsel for the defendant drew my attention to the merits of the case. As I indicated earlier there are already two criminal cases pending between the parties with regard to the same subject matter. Mr. Chhagla the learned counsel for the defendant strenuously argued that the Plaintiff has no business to present the cheque for encasement because he has not performed the agreement. The plaintiff had agreed, according to him, that he will see that 51% share of Catholic Syrian Bank will be assigned in favour of the defendant and towards this as remuneration, three post dated suit cheques as mentioned above, has been given. Since the plaintiff having not performed his part, he has committed cheating by trying to encash the cheque and on this count, the defendant has filed the criminal proceeding under section 470 IPC which is pending in the criminal court. Therefore the learned counsel for the defendant Mr. Chhagla submits that he has a defendable case, wherein the court can grant unconditional leave to defend the suit. Therefore he submits that while considering the application for setting aside the ex-parte decree, an over all view of the merits of the case has to be considered. I do not think that this is a case to take a lenient view.

11. The learned counsel for the defendant further submits that when the parties are fighting each other on the merits of the case, at least an opportunity be given to the defendant to defend the case. In this context he cited a decision of the Supreme Court reported in Rafiq and another vs. Munshilal and another reported in 1981 S.C. page 1400. The learned counsel for the plaintiff Mr. Madan in reply has cited decision of Supreme Court reported in J.T. 1993 (4) S.C. 528 (Salil Dutta Vs. T.M. & M.C. Private Ltd.) and submits that the 1981 decision has been distinguished. In 1981 decision it is said that a party cannot be suffered for the negligence of his lawyer. Therefore this application can be allowed on payment of cost, which can be realized. On the other hand in 1993 J.T.(4) S.C.528, it is held by the Supreme Court that this is not a general rule and that is only an exception. It has been held by the Supreme Court that where a client must be always diligent in prosecuting the case and he cannot solely rely upon his counsel in prosecuting the case. Principals laid down in the above case (supra), in para 8, in fact does directly apply in this case.

"........................... It is true that in certain situations, the court may, in the interest of justice, set aside a dismissal order or an ex-parte decree notwithstanding the negligence and/or misdemeanor of the advocate where it finds that the client was an innocent litigant but there is no such absolute rule that a party can disown its advocate at any time and seek relief. No such absolute immunity can be recognised. Such an absolute rule would make the working of the system extremely difficult. The observations made in Rafiq must be understood in the facts and circumstances of that case and cannot be understood as an absolute proposition. As we have mentioned hereinabove, this was an on-going suit posted for final hearing after a lapse of seven years of its institution. It was not a second appeal filed by a villager residing away from the city, where the Court is located. The defendant is also not a rustic ignorant villager but a private limited company with its head-office at Calcutta itself and managed by educated businessmen who know where their interest lies. It is evident that when their applications were not disposed of before taking up the suit for final hearing they felt piqued and refused to appear before the court. May be, it was part of their delaying tactics as alleged by the plaintiff. May be not. But one thing is clear - they chose to non-cooperate with the court. Having adopted such a stand towards the court, the defendant has no right to ask its indulgence. Putting the entire blame upon the advocate and trying to make it out as if they were totally unaware of the nature or significance of the proceedings is a theory which cannot be accepted and ought not to have been accepted."

12. Here we have to see that we are dealing with a Summary suit. Treatment of ordinary suits and summary suits by Code of Civil Procedure is entirely different. This difference has to be kept in mind, in dealing with setting aside the ex-parte decree also. Rajasthan High Court has clearly spelt out this difference in its decision in Mohanlal V. Om Prakash, reported in AIR 1989 Rajasthan 132. In paras 9 and 10 of the judgment a learned Judge of the Rajasthan High Court held thus:

9. Under R.13 of 0.9 the Court has power to set aside the ex parte decree if the defendant succeeds in satisfying the Court that be was prevented by any sufficient cause from appearing in the Court. Under R.4 of 0.37 it is necessary for the defendant to show that "special circumstances" exist to set aside the decree. Mere "sufficient ground" cannot be equated with "special reason" sufficient cause and "special circumstances" appearing in R.13 of 0.9 and R.4 of 0.37 respectively are not synonymous. Legislature in its wisdom has used the words "special circumstances" in R.4 of 0.37. The gravity of the reasons is more high in case of "special circumstances" as provided under Rule 4 of 0.37. It will not be out of place here to mention that the words "sufficient cause" and "special reasons" carry different meanings. The words "cause" cannot be equated with "reasons" and similarly the word "sufficient" cannot be equated with "special". Special circumstances ordinarily mean that the defendant was prevented to appear in the court on account of unavoidable circumstances beyond his control. In such circumstances, I hold that the meaning assigned to the words "sufficient cause" under R.13 of 0.9 cannot be given to the words used in R.4 of 0.37 to the words "special reasons".

10. A person who has issued cheques having no account in the Bank cannot ordinarily believe on the assurance given by the plaintiff that the case shall be settled out of the court and it is not necessary to appear in the court. Even if it is assumed though it is not correct that such assurance was given even then it cannot be said that the petitioner was prevented to appear in the court and it was not within his power to appear in the court. This ground may be a "sufficient cause" in some cases under R.13 of 0.9 but it cannot be said that it is a "special reason" as envisaged under R.4 of 0.37.

13. The aforesaid judgments clearly lay down as to how differently the court must treat the ordinary suit and summary suit in setting aside ex-parte decree. Accordingly a defendant in summary suit is bound to show special circumstances for his non prosecuting his case as laid down under Rule 4, Order XXXVII of the CPC whereas the defendant in the ordinary suit need only to show "sufficient cause" in Order 13 Rule 9 CPC. This distinction does emphasize the need, of the degree of diligence that has to be observed by the defendant in prosecuting the proceedings before this court under ordinary suit and summary suit. These decisions in fact lay down the guidelines as to how the court's discretionary power could be exercised in the two different nature of suits. In the facts of this case no discretionary power of this court can be exercised in favour of a party who is grossly and wantonly indifferent negligent in prosecuting the matter. I find that at least for two years no explanation is forthcoming from the defendant to explain his delay except amplifying his conduct to purchase time.

14. Yet another submission that was advanced by Mr.Chhagla is that now a days courts were allowing such petition on payment of heavy costs. As I observed earlier this is not a case which falls in that category. This is a case when the defendant has taken an attitude perilously near to defy or abuse the rules and procedure and tried to purchase maximum time to delay the proceeding to his advantage. Such a party deserves no sympathy from this court to allow the petition even on cost.

15. In view of this I find no merit in this Motion. Motion is accordingly dismissed.

16. The statement made by the counsel for the Plaintiff that they will not take any further steps in the execution of the decree will be continued for another four weeks facilitating the defendant to take the matter to the appellate court.

Parties to act on the ordinary copy of this order issued by P.A.

Motion dismissed.