Appeal No.737 of 2001,Notice of Motion No.3508 of 2000,Suit No.542 of 1996

16th January, 2004

Petitioner Counsel: Mr. H. J. THAKKAR,Mr. V. J. SHAH,Madekar & Co.
Respondent Counsel: Mr. RAJIV NARULA,Basant Trilokani & Co.

Cases Cited:
Ratnakar D. Patade Vs. Smita Pandurang Dalvi, 1996(1) ALL MR 31=1996(1) Mh.L.J. 76 [Para 5]
Smt. Asha Madhusudan Joshi Vs. Ashok H. Bhide, 2003(1) ALL MR 1035 [Para 6]
M/s. Babbar Sewing Machine Co. Vs. Tirlok Nath Mahajan, AIR 1978 SC 1436 [Para 7]
Bimal Chand Jain Vs. Gopal Agarwal, AIR 1981 SC 1657 [Para 9]

JUDGMENT

R. M. LODHA, J. :- Twin issues arise in this appeal. The first issue is whether Order 39, Rule 11(1) of the Code of Civil Procedure (Bombay Amendment) introduced in Maharashtra by Notification dated 5th September, 1983 is mandatory or directory. The other issue is if the said provision is held to be directory, whether the learned Single Judge committed any error in exercise of discretion in declining to strike off the defence of the defendant.

2. The aforesaid issues arise in the circumstances which we may briefly indicate. The appellant is the plaintiff and the respondent is the defendant in Suit no.542/1996. The parties are real brothers. The plaintiff claims to be the owner of the subject flat and has prayed for the possession of the flat from the defendant. In the notice of motion taken out by the plaintiff being notice of motion no.2440/1996, the Court Receiver was appointed vide order dated 5th March, 1998 by consent of the parties in respect of the subject flat. By the said order the Court Receiver was directed to take only formal possession and appoint the defendant as its agent for the royalty to be fixed, but without security. The consent order dated 5th March, 1998 came to be challenged by the defendant in appeal. The Division Bench vide order dated 5th May, 1998 dismissed the appeal but granted liberty to the defendant to apply for clarification of the order dated 5th March, 1998, if so advised. The defendant filed review petition which was dismissed on 24th September, 1998. An appeal was preferred by the defendant against the order dated 24th September but be failed. In the meanwhile the Court Receiver took formal possession of the subject flat and appointed the defendant as its agent on monthly adhoc royalty of Rs.5,000/-. Subsequently on receipt of the valuer's report the Court Receiver fixed final royalty of Rs.38,000/- per month in the meeting held on 30th March, 1999. The defendant took out chamber summons being chamber summons no.597/1999 challenging the fixation of royalty at the rate of Rs.38,000/-. Vide order dated 29th September, 1999 the Court Receiver was directed to ascertain the current rate of rent (royalty) that the subject flat would fetch while taking into account the demand and situation of the flat dehors other valuation reports and the Court Receiver was directed to submit the report. In compliance thereof, the Court Receiver submitted the report dated 24th November, 1999 and royalty of Rs.30,000/- to Rs.35,000/- per month was suggested as per the prevailing market rate. By the order dated 6th December, 1999, the learned chamber Judge fixed the sum of Rs.25,000/- per month as royalty. The defendant carried the order dated 6th December, 1999 in appeal. The said appeal was summarily rejected by the order dated 14th March, 2000. On the application of speaking to the minutes, the Division Bench by the order dated 10th April, 2000 ordered that if the arrears of royalty were paid within a period of three months from the date of the order dated 14th March, 2000, the Receiver shall not take forcible possession and if the arrears were not paid by the said deadline and the royalty was not paid every month as already held in the order dated 14th March, 2000, the Court Receiver was permitted to take possession. The defendant challenged the order dated 14th March, 2000 passed by the Division Bench in a special leave petition before the Supreme Court. Vide interim order dated 11th May, 2000 the Apex Court directed that the defendant shall not be dispossessed provided he deposits the entire arrears of royalty at the rate of Rs.5,000/- per month within a period of two months therefrom and in default, the order shall automatically stand vacated. The special leave petition came to be dismissed by the Supreme Court on 9th October, 2000. Upon dismissal of the special leave petition by the Supreme Court, the Court Receiver called upon the defendant to deposit the entire arrears of royalty at the rate of Rs.20,000/- per month for the period from 5th March, 1998 to September, 2000 and at the rate of Rs.25,000/- per month from October, 2000. The defendant did not pay the arrears at the aforesaid rate and instead handed over the possession of the subject flat to the Court Receiver on 19th December, 2000. Before the defendant handed over possession of the subject flat to the Court Receiver on 19th December, 2000, the plaintiff took out notice of motion on 8th December, 2000 praying therein inter-alia that the written statement dated 28th September, 2000 filed by the defendant in the suit be taken off the record and the defence of the defendant be struck off and the suit be placed for ex-parte hearing on such day as the Court may deem fit and proper. The notice of motion, obviously, was taken out by the plaintiff under Order 39, Rule 11(1) of Code of Civil Procedure as applicable in the Maharashtra. The plea of the plaintiff in support of notice of motion has been that the defendant failed and neglected to pay the amount of royalty under the orders and directions of this Court and that the defendant continued to remain in possession in breach of the Court orders and, therefore, the defence of the defendant was liable to the struck off. The defendant responded to the notice of motion and filed his reply affidavit and submitted that he took up the legal proceedings in challenging the order dated 5th March, 1998 whereby he was made agent of the Court. Receiver on the payment of royalty but that all the proceedings taken by him turned in vain and thereafter he had already handed over the possession of the subject flat to the Court Receiver willingly. It is also stated in the reply affidavit that he has regularly paid the adhoc royalty at the rate of Rs.5,000/- per month from 5th March, 1998 until be handed over the possession on 19th December, 2000.

3. The learned Single Judge heard the counsel for the parties and in the impugned order held that Order 39, Rule 11(1) of the Code of Civil Procedure (Bombay Amendment) is directory and that the defendant having already handed over the possession of the subject flat the order striking out the defence of the defendant did not deserve to be passed. It is this order which is under challenge before us.

4. Coming to the first issue first, we may notice that Order 39, Rule 11 of the Code of Civil Procedure (Bombay Amendment) was introduced in the Maharashtra by the notification dated 5th September, 1983. The said provision reads thus :

"11. Procedure of parties defying orders of Court, and committing breach of undertaking to the Court. - (1) Where the Court orders any party to a suit or proceeding to do or not to do a thing during the pendency of the suit or proceeding, or where any party to a suit or proceeding gives any undertaking to the Court to do or to refrain from doing a thing during the pendency of the suit or proceeding, and such party commits any default in respect of or contravences such order or commits a breach of suit undertaking, the Court may dismiss the suit or proceeding, if the default or contravention or breach is committed by the plaintiff or the applicant, or strike out the defence, if the default or contravention or breach is committed by the defendant or the opponent.

(2) The Court may, on sufficient cause being shown and on such terms and conditions as it may deem fit to impose, restore the suit or proceeding or may hear the party in defence, as the case may be, if the party that has been responsible for the default or contravention of breach as aforesaid makes amends for the default or contravention or breach to the satisfaction of the Court.

Provided that before passing any order under this sub-rule notice shall be given to the parties likely to be affected by the order to be passed."

5. In Ratnakar D. Patade Vs. Smita Pandurang Dalvi and others, 1996(1) Mh.L.J. 76 : [1996(1) ALL MR 31] a learned Single Judge of this Court took the view that the provision of sub-rule (1) of Rule 11 of Order 39 of the Code of Civil Procedure is mandatory in nature. While holding so, the learned Single Judge gave the reasons thus :

"10. It is correct that the word 'may' generally does not mean 'must' or 'shall'. But it is well settled that the word 'may' is capable of meaning 'must' or 'shall' in the light of context. As held by the Supreme Court in the case of State of Uttar Pradesh Vs. Jogendra Singh reported in AIR 1963 SC 1813 on which reliance has been placed by Mr. Jahagirdar, where a discretion is conferred upon a public authority coupled with an obligation, the word 'may' which denotes discretion should be construed to mean a command. In determining the question whether a provision is mandatory or directory, the subject matter, the importance of the provision, the relation of the provision to the general object intended to be secured by the Act will decide whether the provision is directory or mandatory. As held by the Supreme Court in re: Presidential Election, 1974 reported in AIR 1974 SC 1682, it is the duty of the Courts to get at the real intention of the legislature by carefully attending to the whole scope of the provision to be construed.

11. The difference between a mandatory rule and directory rule is that while former must be strictly observed, in the case of the latter, substantial compliance may be sufficient to achieve the object regarding which the rule is enacted. As held by the Supreme Court in the case of Sharif-ud-bin Vs. Abdul Gani Lone reported in AIR 1980 SC 303, whenever a statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to a specific consequence, it would be difficult to hold that the requirement is not mandatory and the specified consequences should not follow. Rule 11(1) lays down the failure to comply with Court's Order leads the specified consequence and on fair construction thereof, it is clear that if a party commits default in complying Court's Order or contravenes it then the consequence as provided therein has to follow. The whole purpose of Rule 11(1) would be frustrated if the word 'may' in sub-section (1) would receive construction to mean 'discretionary' or 'directory'. In my view keeping in mind the general object intended to be secured and carefully attending to the scope of the provision, Rule 11(1) of the Code of Civil Procedure is 'mandatory' in nature and the trial Court has erred in construing it as 'discretionary' in nature."

6. The aforesaid view of the learned Single Judge in Ratnakar D. Patade has been followed by another learned Single Judge in Smt. Asha Madhusudan Joshi Vs. Ashok H. Bhide, 2003(1) ALL MR 1035. In Smt. Asha M. Joshi, the learned Single Judge held thus :

"15. Rule 11 is added in Order XXXIX of the Code of Civil Procedure by the High Court vide notification dated 5-9-1983 with a specific purpose and to achieve definite objective. The intent of Rule is to provide the necessary action to be taken by the Court in case parties to the suit defy the order pased by the Court or commit breach of undertaking given to the Court. This provision is introduced with positive object that the parties to the suit must face necessary consequences contemplated by this Rule in case they defy the order of the Court or commit breach of the undertaking given to the Court. The scheme of Order XXXIX Rule 11(1) is to clothe the Court with a power to take appropriate action against the parties to the suit in case they defy the order of the Court or commit breach of the undertaking given to the Court. It is no doubt true that the words "Court may" used in the provision, which in the normal set of circumstances, imply that the discretion given to the Court for taking necessary action in the circumstances mentioned in the order, are directory. However, the word "may" in a given case is directory or mandatory needs to be construed in view of scheme of provision as well as intent and objective to be achieved by such provision. Similarly, weighing of the consequences of holding a provision to be mandatory or directory is vital and more often that not determinative of the very question whether the provision is mandatory or directory. When the design of a statute or provision is to clothe with the power in the Authority or Court for taking definite and positive action in case of breach thereof, then the provision must be construed to be mandatory in nature even though the word used is "may". While applying these parameters to Rule 11(1), I have no hesitation to hold that Rule 11(1) of Order XXXIX of the Code of Civil Procedure is mandatory in nature."

7. Rule 11 of Order 39 as introduced by the Bombay amendment provides for a procedure on parties defying orders of the Court and/or committing breach of any undertaking to the Court. We are concerned with the question whether sub-rule (1) of Rule 11, Order 39 leaves no discretion on the Court and that it obliges the Court to visit the defaulting party with the penalty prescribed therein irrespective of the circumstances that default is not willful or the conduct of the party responsible for the default is not contumacious or there is reasonable explanation for default. The meaning and intention of the rule making authority must govern, and these are to be ascertained not only from the phraseology of the provision but also by considering its nature, its design, and the consequences which would follow from construing it one way or the other. Inter-alia the Courts have applied the test whether the object of the provision will be defeated or furthered by holding the provision mandatory or directory. Let us not forget that the dismissal of suit or proceeding or striking out the defence of a defendant for non-compliance of the Court's order or breach of an undertaking is a serious and grave consequence. By making provision of serious penalty of dismissal of suit or striking out the defence against the party responsible for default, the rule making authority did not intend to leave no discretion to the Court. The object of the provision of Order 39 Rule 11 (1) is not defeated if it is held to be directory as the Court can in its discretion for adequate reasons visit the defaulting party with penalty envisaged therein. On the other hand if the provision is held mandatory, the Court 'shall' be left with no discretion and peremptorily shall have to dismiss the suit where the plaintiff is responsible for the default or to strike off the defence when the defendant is guilty of default even though the default is not found willful or conduct of such party not obstinate or contumacious. In our considered view, the provision in sub-rule (1) merely vests power in the Court to dismiss the suit or proceedings where the default is by the plaintiff and strike off the defence of the defendant where the defaulter is the defendant. It does not obligate to do so in every case of default. This is further fortified by the provision contained in sub-rule (2) which gives a discretion to the Court that even after the order contemplated under sub-rule (1) of Rule 11 has been passed, upon sufficient cause being shown by the party responsible for the default or contravention or breach and such party makes amend for the default or contravention or breach to the satisfaction of the Court, the Court may restore the suit or hear the defence on such terms and conditions it deems fit. If the Court has power to restore the party to the same position even after the adverse order has been passed under sub-rule (1) of Rule 11 if the case is made out under sub-rule (2), the provision of sub-rule (1) has to be held to be directory and not imperative. The provision in the nature of sub-rule (2) leaves no manner of doubt the intention of the rule making authority that the provision of sub-rule (1) of Rule 11 is directory and that by such provision power has been vested in the Court to dismiss the suit or proceeding where the plaintiff is in default or striking off the defence of the defendant, where defendant is responsible for the default. Unfortunately, neither in Ratnakar D. Patade nor in Smt. Asha M. Joshi, the learned Judges adverted to sub-rule (2) of Rule 11 and its effect. The Supreme Court in M/s. Babbar Sewing Machine Co. Vs. Tirlok Nath Mahajan, AIR 1978 S.C. 1436 held that the power of dismissal of suit or striking out of the defence under Order 11, Rule 21 of the Code of Civil Procedure should be exercised only where the defaulting party fails to attend the hearing or is guilty of prolonged or inordinate and inexcusable delay which may cause substantial or serious prejudice to the opposite party. It was further observed that an order striking out the defence under Order 1, Rule 21 should be made unless there has been obstinacy or contumacy on the part of the defendant or willful attempt to disregard the order of the Court to produce the documents. In paragraphs 14,16 and 24 of the report the Supreme Court held thus :

"14. Even assuming that in certain circumstances the provisions of O.XI, R.21 must be strictly enforced, it does not follow that a suit can be lightly thrown out or a defence struck out, without adequate reasons. The test laid down is whether the default is willful. In the case of a plaintiff, it entails in the dismissal of the suit and, therefore, an order for dismissal ought not be made under O.XI, R.21, unless the court is satisfied that the plaintiff was willfully withholding information refusing to answer interrogatories or by withholding the documents which he ought to discover. In such an event, the plaintiff must take the consequence of having his claim dismissed due to his default, i.e. by suppression of information which he was bound to give : Denvillier Vs. Myedrs, (1883) WN 58. In the case of the defendant, he is visited with the penalty that his defence is liable to be struck out and to be placed in the same position as if he had not defended the suit. The power for dismissal of a suit or striking out of the defence under O.XI, R.21, should be exercised only where the defaulting party fails to attend the hearing or is guilty of prolonged or inordinate and inexcusable delay which may cause sub-stantial or serious pre-judice to the opposite party.

16. An order striking out the defence under O.XI, R.21 of the Code should, therefore, not be made unless there has been obstinacy or contumacy on the part of the defendant or willful attempt to disregard the order of the court. The rule must be worked with caution, and may be made use of as a last resort : Mulla's C.P.C 13th Ed., Vol.1, p.581, Khajah Assenoolla Joo Vs. Khajan Abdool Aziz, (1883) ILR 9 Cal 923; Banshi Singh Vs. Palit Singh, (1908)7 Cal LJ 295; Allahabad Bank Ltd. Vs. Ganpat Rai, ILR 11 Lah 209 : (AIR 1929 Lah 750); Haigh Vs. Haigh, (1885)31 Ch.D. 478 and Twycroft Vs. Grant, (1975) WN 201.

24. The principle governing the court's exercise of its discretion under O.XI, R.21, as already stated, is that it is only when the default is willful and as a last resort that the court should dismiss the suit or strike out the defence, when the party is guilty of such contumacious conduct or there is a willful attempt to disregard the order of the court that the trial of the suit is arrested. Applying this test, it is quite clear that there was no willful default on the part of the defendant of the court's order under O.XI, R.18(2) for the production of documents for inspection, and consequently, the order passed by the trial court on 23rd May, 1967, striking out the defence of the defendant must be vacated, and the trial must proceed afresh from the stage where the defendant was not permitted to participate."

8. The aforesaid position of law was laid down by the Apex Court in respect of Order 11, Rule 21 of the Code of Civil Procedure. Order 11, Rule 21 reads thus :

"21. Non-compliance with order for discovery.- (1) Where any party fails to comply with any order to comply with any order to answer interrogatories, or for discovery or inspection of documents, he shall, if a plaintiff, be liable to have his suit dismissed for want of prosecution, and, if a defendant, to have his defence, if any, struck out, and to be placed in the same position as if he had not defended,and the party interrogating or seeking discovery or inspection may apply to the Court for an order to that effect, and (an order may be made on such application accordingly, after notice to the parties and after giving them a reasonable opportunity of being heard.)

(2) Where an order is made under sub-rule (1) dismissing any suit, the plaintiff shall be precluded from bringing a fresh suit on the same cause of action.

Amendments : Objects and Reasons.- Clause 64- sub-clause (iv).- Under rule 21, where any party fails to comply with any order to answer interrogatories or for discovery or inspection of documents, he shall, if a plaintiff, be liable to have the suit dismissed for want of prosecution; and if a defendant, to have his defence, if any, struck off, and be placed in the same position as if he had not defended. The rule further provides that a party interrogating or seeking discovery or inspection may apply to the Court for an order to that effect. The rule is being amended to provide for the passing of the order after giving notice to the plaintiff or defendant, as the case may be, and after giving him a reasonable opportunity of being heard. (Statement of Objects and Reasons (Bill)- Gazatte of India, Ext. dt.8-4-1974, Pt.II, S.2, p.316)

Sub-clause (v).- New sub-rule (2) is being inserted to provide that a fresh suit would be barred when a suit is dismissed under this rule."

The consequence of dismissal of suit or striking out the defence in Order 11, Rule 21 is visited as the case may be where the party fails to comply with the order to answer interrogatories or for discovery or inspection of documents. Under Order 39, Rule 11(1)of the Code of Civil Procedure the consequence of dismissal of suit or striking out the defence follows where there is default in compliance of order of the Court or breach of an undertaking by the plaintiff or the defendant, as the case may be. The provision of Order 11, Rule 21 having been held to be directory in M/s. Babbar Sewing Machine Co. by the three Judge Bench of the Supreme Court, we have no hesitation in holding that for the selfsame reasons sub-rule (1) of Rule 1 of Order 39 of Code of Civil Procedure as introduced in Maharashtra by Bombay Amendment has to be held directory and the discretion exercisable by the Court in passing the order under sub-rule (1) of Rule 11 of Order 39 has to be in consonance and in conformity with the legal position laid down by the Supreme Court in M/s. Babbar Sewing Machine Co. In other words, the power of dismissal of suit of striking out the offence, as the case may be, under Order 39, Rule 11(1) of Code of Civil Procedure should be exercised for adequate reasons; where the defaulting party fails ultimately in complying with the order of the Court or the undertaking; where the default is willful and the conduct of the defaulting party contumacious and the results in causing substantial or serious prejudice to the opposite party.

9. Another judgment of the Supreme Court in Bimal Chand Jain Vs. Gopal Agarwal, AIR 1981 S.C. 1657 may also be noticed by us. In Bimal Chand Jain, the Supreme Court considered the provision contained in Order 15, Rule 5(2) U.P. as amended by U.P. Act No.57 of 1976. The said provision reads thus :

"Striking off defence on failure to deposit admitted rent, etc. - (1) In any suit by a lessor for the eviction of a lessee after the determination of his lease and for the recovery from him of rent or compensation for use and occupation, the defendant shall, at or before the first hearing of the suit, deposit the entire amount admitted by him to be due together with interest thereon at the rate of nine per cent per annum and whether or not he admits any amount to be due, he shall throughout the continuation of the suit deposit the monthly amount due within a week from the date of its accrual and in the event of any default in making the deposit of the entire amount admitted by him to be due or the monthly amount due as aforesaid, the court may subject to the provisions of sub-rule (2) strike off his defence.

Explanations 1 to 3 x x x x x

(2) Before making an order for striking off defence, the court may consider any representation made by the defendant in that behalf provided such representation is made within ten days of the first hearing or of the expiry of the week referred to in sub-section (1) as the case may be.

(3) The amount deposited under this rule may at any time be withdrawn by the plaintiff;

Provided that such withdrawal shall not have the effect of prejudicing any claim by the plaintiff disputing the correctness of the amount deposited;

Provided further that if the amount deposited includes any sums claimed by the depositor to be deductible on any account the court may require the plaintiff to furnish security for such sum before he is allowed to withdraw the same."

10. The aforesaid provision of Rule 5 of Order 15 of the Code of Civil Procedure as amended in Uttar Pradesh was held to be directory by the Supreme Court and it was held that the word "may" in sub-rule (1) merely vested power in the court to strike off the defence and it did not oblige it do so in every case of default. In paragraph 6 of the report, the Apex Court held thus :

"6. It seems to us on a comprehensive understanding of Rule 5 of Order XV that the true construction of the Rule should be thus. Sub-rule (1) obliges the defendant to deposit, at or before the first hearing of the suit, the entire amount admitted by him to be due together with interest thereon at the rate of nine per cent annum and further, whether or not he admits any amount to be due, to deposit regularly throughout the continuation of the suit the monthly amount due within a week from the date of its accrual. In the event of any default in making any deposit;

"the court may subject to theprovisions of sub-rule (2) strike off his defence." We shall presently come to what this means. Sub-rule (2) obliges the court, before making on order for striking off the defence to consider any representation made by the defendant in that behalf. In other words, the defendant has been vested with a statutory right to make a presentation to the court against his defence being struck off. If a representation is made the Court must consider it on its merits, and then decide whether the defence should or should not be struck off. This is a right expressly vested in the defendant and enables him to show by bringing material on the record that he has not been guilty of the default alleged or if the default has occurred there is good reason for it. Now, it is not impossible that the record may contain such material already. In that event, can it be said that sub-rule (1) obliges the court to strike off the defence? We must remember that an order under sub-rule (1) striking off the defence is in the nature of a penalty. A serious responsibility rests on the court in the matter and the power is not to be exercised mechanically. There is a reserve of discretion vested in the court entitling it not to strike off the defence if on the facts and circumstances already existing on the record it finds good reason for not doing so. It will always be a matter for the judgment of the court to decide whether on the material before it, notwithstanding the absence of a representation under sub-rule (2), the defence should or should not be struck off. The word "may" in sub-rule (1) merely vests power in the court to strike off the defence. It does not oblige it to do so in every case of default. To that extent, we are unable to agree with the view taken by the High Court in Puran Chand (1981 All LJ 82) (Supra). We are of the opinion that the High Court has placed an unduly narrow construction on the provisions of Clause (1) of Rule 5 of Order XV."

11. Applying the aforesaid observations and reasoning of the Supreme Court in M/s. Babbar Sewing Machine Co. with regard to Order 11, Rule 21 of the Code of Civil Procedure and Bimal Chand Jain with regard to Order 15 Rule 5 of the Code of Civil Procedure as amended in UP, in our considered opinion, the provision contained in sub-rule (1) of Rule 11 of Order 39 applicable in Maharashtra is directory and we hold accordingly. The view taken by the two learned Single Judges in Ratnakar D. Patade and Smt. Asha M. Joshi to the effect that Order 39, Rule 11(1) of Code of Civil Procedure is mandatory cannot be held to be laying down the correct position of law and we over-rule the said decisions.

12. As regards the second issue as to whether the learned Single Judge committed any error in exercise of his discretion in refusing to strike out the defence of the defendant, we shall first notice the observations of the learned Single Judge himself. In paragraph 10 of the impugned order, the learned Single Judge observed thus:

"10. The Defendant may be blamed for having changed his original stand inspite of the concession made on his behalf. But, he cannot be blamed for having taken out proceedings for getting the amount of royalty reduced. Shri. Thakkar pointed out that the Defendant is a man of means and he is in a position to pay the arrears of royalty. It cannot, however, be ignored that the outstanding arrears are not less than Rs.6,85,000/-. The Defendant might have rightly felt that payment of royalty at the rate of Rs.25,000/- per month was not within his capacity. Therefore, ultimately Defendant submitted to the Court's order dated 10-4-2000 which empowered the Court Receiver to take forcible possession in case the arrears of royalty were not paid within three months from 14-3-2000. Accordingly, the Defendant has handed over possession of the suit flat to the Court Receiver on 19-12-2000. It is true that on account of the Defendant's failure to pay the amount of royalty, the Plaintiff is entitled to invoke the provision of Order 39, Rule 11. However, in my opinion striking out the defence of the Defendant would amount to imposition of double penalty on him. As already pointed out, the Defendant has handed over possession of the suit flat which was very much in his possession for a period of fourteen years. However, because of his inability to pay the arrears of royalty, he had to lose possession of the suit flat. Under these circumstances, I do not think that there is a willful default on the part of the Defendant which would entail the consequence of striking out his defence. I, therefore, do not agree with the submission made by Shri. Thakkar."

13. We find no justifiable reason to take a different view and interfere with the discretion exercised by the learned Single Judge. Firstly because the defendant having failed in all proceedings in challenging the order dated 5th March, 1998, after rejection of the special leave petition in the month of October, 2000 handed over the possession of the subject flat to the Court Receiver on 19th December, 2000 on his own as he found that he was not in position to pay the royalty as fixed to the Court Receiver as its agent. Secondly, the defendant had paid the adhoc royalty at the rate of Rs.5,000/- per month. As late as by the order dated 11th May, 2000 the Supreme Court, in the special leave petition filed by the defendant by way of an ad-interim order directed that the defendant shall not be dispossessed provided he deposited the entire arrears of royalty at the rate of Rs.5,000/- per month within a period of two months therefrom. The defendant did deposit the entire arrears of royalty at the rate of Rs.5,000/- per month and paid the royalty at the rate of Rs.5,000/- per month. The said ad-interim order came to be discharged by the Supreme Court on 9th October, 2000 when the special leave petition was dismissed. Thereafter in the month of December, 2000, the defendant handed over possession to the Court Receiver. In this view of the matter, we are satisfied that the learned Single Judge did not commit any error in not passing the stringent order striking out the defence of the defendant when he had already handed over possession to the Court Receiver. These circumstances clearly indicate that the conduct of the defendant cannot be held to be obstinate or contumacious. Moreover by the impugned order no grave prejudice can be said to have occasioned to be plaintiff as he will have an opportunity to establish his case in the trial. On the other hand, the defendant shall suffer hugely if his defence is not considered merely because he took chances in pursuing the further remedy of appeals in the matter of fixation of royalty in which he failed. If the plaintiff succeeds in the suit, he would be entitled to mesne profits for the disputed period as per the order that may be passed while decreeing the plaintiff's suit.

14. All in all, it cannot be said that the learned Single Judge committed any manifest error in declining to strike out the defence of the defendant for the reasons indicated by him in the impugned order.

15. We, accordingly, do not find any merit in the appeal and the same is dismissed with no order as to costs.

16. This also disposes of Court Receiver's report dated 22nd July, 2002.

Certified copy expedited.

Appeal dismissed.