COMMERCIAL SUIT NO. 428 OF 2017

10th January 2020

Petitioner Counsel: Mr. Farhan Dubash Mr. Chaitanya Chavan Ms. Supriya Bhatkar Vigil Juris
Respondent Counsel: Mr. Dinyar D. Madon Mr. Cyrus Ardeshir Mr. Neville Mukerji Mr. Asim Tirmizi Veritas Legal
Act Name: Code of Civil Procedure, 1908

Cases Cited :
Para 3: Axis Bank Vs. Smt. Mira Gehani, 2019 SCC OnLine Bom 358
Paras 7, 9, 13: Manju Parthi and Ors. Vs. Rohit Parthi, 2007 (99) DRJ 257
Paras 7, 9, 11: Dareppa Alagouda Basagoudnavar Vs. Mallappa @ Shivalingappa Shridrama Guntaji., ILR [1947] Bom.178
Paras 7, 9, 10: Ramgopal and Anr. Vs. Khiv Raj and Ors., AIR 1998 Raj 98
Paras 7, 9, 12: Babulal N. Shukla Vs. Jeshankar N. Shukla., MANU/WB/0107/1972
Paras 22, 23: Vidyawati Vs. Man Mohan, (1995) 5 SCC 431
Para 23: Jagdish Chander Chatterjee Vs. Sri Kishan, (1972) 2 SCC 461
Paras 23, 24: Bal Kishan Vs. Om Parkash, (1986) 4 SCC 155
Para 25: Abdul Razak (Dead), through LRs and Others Vs. Mangesh Rajaram Wagle and Others, (2010) 2 SCC 432

JUDGEMENT

1. In a matter that is listed for directions, an application was moved on behalf of defendant nos.5(a), 5(b) and 5(c) seeking leave to file written statement. The application is vehemently opposed by the plaintiffs. Defendant nos.5(a), 5(b) and 5(c) are legal heirs of original defendant no.5. The suit seeks recovery of a sum of Rs.2,02,02,220/-. It is a dispute between two partnership firms. In the suit, as originally filed, there were six defendants. Defendant no.4 was a partnership firm, of which defendant nos.5 and 6 were said to be the partners. Defendant no.6 was already impleaded as defendant no.2. Defendant no.5 died on 26th May 2018, leaving behind defendant nos.2, 5(a), 5(b) and 5(c) as the only legal heirs. On 17th July 2019, the plaintiffs sought amendment to the plaint to implead the said legal heirs. The amendment was carried out on 30th July 2019. The aforesaid heirs sought leave to file written statement, which was opposed on behalf of the plaintiffs on the ground that vide an order dated 22nd March 2019, the suit has been directed to proceed ex-parte against defendant no.5.

2. The record indicates that the suit was listed for directions on 26th September 2017. It was submitted that defendant no.5 was served personally on 6th September 2017, but the record also indicates that there is a letter received from the Sheriff of Mumbai dated 12th December 2017, which indicates that summons and plaint sent to defendant no.5 had been returned undelivered. The affidavit-of-service is dated 18th December 2017. Defendant no.5 entered appearance on that day, although the vakalatnama is dated 18th August 2017. It was submitted on behalf of the plaintiffs that time to file written statement on behalf of defendant no.5 expired on 6th October 2017, by virtue of provisions of Order VIII Rule 1 of CPC; however, being a commercial suit, the last date of filing written statement was determined as 4th January 2018, since the 120th day expired on that day. Defendant no.5 forfeited the right to file written statement as on that date. It transpires that the 5th defendant died on 26th May 2018. On 1st March 2019, the court directed Advocates for defendant no.5 to provide the names of the legal heirs and a copy of the death certificate of defendant no.5. Names of the legal heirs were provided on 16th March 2019 and on 22nd March 2019. When the matter came up for directions, the plaintiffs contended that defendant nos.2, 3 and 5 having caused appearance to be entered, filing of vakalatnama would obviate the need for service of writ of summons, since there would be deemed waiver of service of writ of summons. The court disagreed and observed that there was nothing to indicate that the said defendants’ Advocates had waived service of writ of summons and unless there was an undertaking of Advocates to accept service of summons and to file a vakalatnama on behalf of the defendants.

3. In the meantime, this court in the case of Axis Bank Vs. Smt. Mira Gehani, 2019 SCC OnLine Bom 358 held that the period of 120 days for filing the written statement would commence from the date of service of writ of summons and not on the date when the defendant first entered appearance. In that view of the matter, it was contended on behalf of the plaintiffs that the time for filing written statement having expired and the defendant no.5 having been served with the writ of summons prior to her demise, the matter could proceed exparte. On 22nd March 2019, the court directed that the suit as against defendant nos.1, 3, 4 and 5 should proceed as undefended suit. The matter came to be adjourned. On 16th April 2019, disputes were referred to mediation. Defendant no.5 had by then expired. The heirs of defendant no.5 may have participated; however, on 10th July 2019, the court recorded absence of the heirs of defendant no.5 during mediation and directed that the heirs of defendant no.5 shall be involved in further meetings. Meetings were scheduled to be held between 13th July 2019 and 15th July 2019 and success or failure of mediation was to be reported. The matter came to be adjourned to 17th July 2019. On 17th July 2019, the plaintiffs’ counsel tendered draft amendments, thereby seeking to implead the heirs. Defendant no.5’s heirs were represented and they undertook to file appearance and it is on this basis that the vakalatnama of defendant nos.5(a) to 5(c) came to be lodged/filed on 31st July 2019.

4. The opposition by the plaintiffs is on the basis that once the suit has been directed to proceed as an undefended suit against original defendant no.5, the heirs of deceased defendant no.5, being defendant nos.5(a) to 5(c), have no right to file written statement. They would stand or fall on the basis of the case, if any, that the original defendant no.5 had made out. It is submitted that the heirs could not now file a written statement.

5. Order XXII of the CPC provides for the procedure to be adopted on the death, marriage and insolvency of parties. Order XXII Rule 4 deals with the procedure in case of death of one of several defendants or of a sole defendant. In the present case, the relevant provision is Order XXII Rule 4 sub-rule (2). When defendant no.5 died, the right to sue, it is submitted, survived against the heirs and accordingly an application was made on 17th July 2019 for impleading defendant nos.5(a) to 5(c). That application having been allowed, it was clear that the right to sue survived as against defendant nos.5(a) to 5(c). Sub-clause (2) of Rule 4 Order XXII reads as under :-
“(2) Any person so made a party may make any defence appropriate to his character as legal representative of the deceased defendant.”

6. Thus, a party, who was so impleaded, as in the present case, would have a right to make “any defence appropriate to his character as legal representative of the deceased defendant” . The expression “party may make any defence” is to be considered in the context of a defendant(s) impleaded as legal heir(s) viz. defendant nos.5(a) to 5(c) in the present case, who would have to defend the suit, but the defence would be restricted to their character as legal representatives of the deceased defendant no.5.

7. Defendant no.5(a) is the grand-daughter of deceased defendant no.5 and defendant nos.5(b) and 5(c) are the daughters of deceased defendant no.5. The aforesaid defendants undoubtedly, had a vested right to make a defence, which should be appropriate to their character as legal representatives of the late defendant no.5. The issue before the court today is whether these defendant nos.5(a) to 5(c) can and should be deprived of their right to file their written statement(s). To recapitulate, the submission on behalf of the plaintiffs is that no such right survives once the court had passed an order directing the suit to proceed undefended as against original defendant no.5. It was submitted that this issue came up for consideration in some other cases. Reference was made by Mr. Dubash to the following decisions :-
(i) Manju Parthi and Ors. Vs. Rohit Parthi, 2007 (99) DRJ 257 of Delhi High Court.
(ii) Dareppa Alagouda Basagoudnavar Vs. Mallappa @ Shivalingappa Shridrama Guntaji., ILR [1947] Bom.178 of Bombay High Court.
(iii) Ramgopal and Anr. Vs. Khiv Raj and Ors., AIR 1998 Raj 98 of Rajasthan High Court.
(iv) Babulal N. Shukla Vs. Jeshankar N. Shukla., MANU/WB/0107/1972 of Calcutta High Court.

8. Relying upon these judicial pronouncements, it was contended by Mr. Dubash and Mr. Chavan, learned counsel for the plaintiffs, that defendant nos.5(a) to 5(c) have no independent right to make a defence and that they are bound by the defence, if any, taken by original defendant no.5 and in the instant case, since defendant no.5 had not filed a written statement, the defendant nos.5(a) to 5(c) have no right to now file a written statement. One of the other submissions made was whether it was necessary for the plaintiffs to serve the heirs of deceased defendant no.5 with a writ of summons and in this behalf, it was contended that no fresh writ of summons needs to be issued.

9. In the facts of the case, I do not find that is an issue in contest between the parties. What falls for consideration is whether defendant nos.5(a) to 5(c) have a right to file a written statement, in exercise of their right to make any defence appropriate to their character as legal representatives. In this behalf, I am of the view that such defendants 5(a) to 5(c) do have a vested right to file a written statement. The aforesaid decisions in Manju Parthi (supra), Dareppa Alagouda Basagoudnavar (supra), Ramgopal (supra) and Babulal N. Shukla (supra) can all be differentiated.

10. In Ramgopal (supra) , an ex-parte order has been passed against the deceased respondent. In the facts of that case, the respondents were legally bound by the pleading of the predecessors-in-interest. In the present case, defendant no.5 had not filed any written statement prior to her demise. The suit was directed to proceed undefended as against defendant no.5. Thus, no pleading on behalf of defendant no.5 was on record.

11. In Dareppa Basagoudnavar (supra) , the court observed that all that the legal representatives can do is to take up the suit at the stage at which it was left when the original party died and to continue it. The court, therefore, did recognize that the legal representatives had a right to continue with the suit, but the issue that has arisen in the present suit did not arise in Basagoudnavar.

12. In Babulal N. Shukla (supra) , the court declined to issue a fresh writ of summons on a petition filed by the plaintiff seeking issuance of a fresh writ of summons for the purposes of service upon substituted defendants. The facts of the case reveal that upon demise of the original defendant, the legal heirs, who were made party to the suit, upon impleadment, were sought to be served with writ of summons. The court observed that, if a writ of summons is served on the substituted party, the writ itself will give the party a right to enter appearance in the suit and to file his written statement. But in the case before the Calcutta High Court, the deceased defendant had already filed his written statement jointly with defendant no.1 and, therefore, it was found that his legal representative cannot be permitted to make out a fresh case in another written statement. It was thus clearly distinguishable.

13. In Manju Parthi (supra) , the Delhi High Court considered a case where a decree had already been passed. It was held that the deceased-defendant had been proceeded against ex-parte. He was deprived of his right to file the written statement and the legal representative could not set the clock back and file a written statement, as if the case had started afresh. He would be required to move an application for setting aside the ex-parte decree.

14. Thus, in each of these cases cited before me in support of the contention that the present defendant nos.5(a) to 5(c) are not entitled to file written statement, either the original defendant(s) had already filed written statements and/or the suit had been decreed as against the original defendants. In the facts of the present case, no written statement has been filed by the original defendant no.5. The case at hand is quite different inasmuch as the suit was ordered to be proceeded against ex-parte on the basis that no written statement was filed. It is not a case wherein a written statement had been filed and the defendants remained absent or otherwise caused an ex-parte decree to be passed.

15. In the course of submissions, Mr. Madon on behalf of the defendants submitted that between 26th May 2018, when the original defendant no.5 died, and 1st March 2019, the plaintiffs have not taken steps whatsoever. It is only on 1st March 2019, when this matter came to be listed, that the defendants’ counsel informed the court that defendant no.5 had expired and that a communication to that effect would be forwarded to the plaintiffs. Whether or not this fact of demise of defendant no.5 was known to the plaintiffs or it is not something that we need to consider in relation to the issue at hand. The point to be considered is whether defendant nos.5(a) to 5(c) are to be faced with a fait accompli upon demise of original defendant no.5 and suffer consequences of defendant no.5 not having filed a written statement. Order XXII Rule 4 sub-rule (2) obviously does not intend to deprive such substituted defendants of a right to assert their defence; as otherwise, the entire exercise of impleadment would entail that a party who is impleaded as legal heir and substituted in place of the original defendant, would be left with no alternative but to face with proceedings conducted without reference to any defence that fits the legal character that such heirs assume upon demise of the original defendant. The expression “a party may make any defence appropriate to his character as legal representative” must have meaning such that a party who is impleaded as legal representative of a deceased party, would be entitled to make a defence, provided that the defence does not exceed the limits of the character that he holds as legal representative. He cannot set up a defence independent to that of the original defendant. In other words a new case cannot be set up by legal representatives.

16. In this behalf, it would be appropriate to consider the meaning of the expression “defence”. Order VIII Rule 1 of CPC deals with written statement, set-off and counter-claim. Rule 1 provides the defendant with a right to file written statement within 30 days of service of summons upon him; the intention being to facilitate placing his defence on record. Likewise, Rule 7 provides defence or set-off founded upon separate grounds. Where a defendant relies upon several distinct grounds of defence or set-off founded upon separate and distinct facts, they may be stated, as far as may be, separately and distinctly. Under Rule 8, any ground of defence, which has arisen after the institution of the suit or the presentation of a written statement claiming a set-off, may be raised by the defendant or plaintiff, as the case may be, in his written statement.

17. The purpose of providing a party with a right to file written statement is to ensure that his defence is considered by the court. The defence of a party can only be considered, if a pleading is filed and in the instant case, upon service of summons, it is the written statement that is the “pleading” expected to be filed by a defendant in order to enable him to state his defence to the plaintiff’s case. Read in this context, Order XXII Rule 4 sub-rule (2) of Code, in my view, clearly contemplates a situation where a party, who is substituted as a defendant, including legal heirs of such defendant, as in the present case, will be entitled to file a written statement notwithstanding the fact that the original defendant had omitted to file her written statement. The written statement shall however be restricted to a defence that is “appropriate to his character as legal representative of the deceased defendant” , implying thereby that no fresh defences independent of his/her character as legal representative may be taken. This will ensure that the intention behind the provisions of the Code are met as otherwise, legal heirs would be left with no option, but to face consequences of the original defendant not having defended the suit and to defend the suit without a pleading in defence.

18. In the course of submissions on behalf of the plaintiffs, it was pointed out that as on date of the order dated 22nd March 2019, defendant no.5’s demise had already been taken into consideration. Be that as it may, the fact of Order XXII Rule 4 sub-rule (2), making a provision for a defence to be entered, was clearly not in contemplation of the parties or the court as on that date. In any event, the order dated 22nd March 2019 reveals original defendant no.5 not having filed written statement earlier and not having been subjected to a decree, the facts of the case in hand are clearly distinguishable from those that counsel for the plaintiffs has invited my attention to consider.

19. The restriction imposed upon legal heirs, who are required to take up a defence limited to their character as legal representatives, under Order XXII Rule 4(2) of CPC, would not, for instance, permit the legal representative to take up defences inconsistent or independent with the original defendant’s defence, if any, and/or file a counter-claim along with his written statement, if a counter-claim had not already been filed by the original defendant.

20. In the instant case, the plaintiffs, by impleading the legal heirs, have affirmed the fact that the right to sue survives, as otherwise the suit would abate against the deceased-defendant. Once this option to continue the suit against the legal heirs is exercised, the legal heirs cannot be deprived of their right to take up a defence, as may be permissible in law. A defence in a suit can be taken only in writing by filing a pleading by virtue of the provisions of Order XXII Rule 4(2) of CPC. A pleading would mean either a plaint or a written statement and every pleading is required to be signed by virtue of Order VI Rule 14 by a party and his pleader, if any. In proceedings other than suits, a defence is normally taken up by way of an affidavit-in-reply. Pleadings are also required to be verified in terms of Order VI Rule 15. Order VIII Rule 1 requires that the defendant shall, within thirty days from service of summons, present a written statement of his defence. Under Order VIII Rule 6, the defendant is entitled to seek a set-off and under Rule 6A, a counter-claim. Under Order VIII Rule 9, no pleading, subsequent to the written statement of a defendant, other than by way of a defence to set-off or counter-claim, shall be presented, except with the leave of the court. Under Rule 10, if a party fails to present a written statement called for by court within time permitted, the court shall pronounce judgment against him or make such order as it may deem appropriate. The fact that a defence must, therefore, be filed and that such defence will be by way of a written statement, cannot be disputed.

21. Where the original defendant dies and the legal heirs are permitted to enter defence, the only manner in which such a defence can be taken is by filing a written statement. The law does not contemplate depriving a legal heir from taking up a defence, merely because the original defendant failed or neglected or otherwise omitted to file a written statement in defence. Order XXII Rule 4(2), therefore, must be interpreted in a manner such as to enable a legal heir to take up his defence. To accept the plaintiffs’ contentions that no written statement can now be filed and especially in view of the order dated 22nd March 2019, would be to deny the newly added defendants a fair opportunity to meet the case against the original defendant and deny the benefit of basic rules of natural justice.

22. The Supreme Court has/had occasions to consider the scope of an additional written statement on behalf of the legal representatives of a deceased defendant. In Vidyawati Vs. Man Mohan, (1995) 5 SCC 431, the court considered a question whether a person impleaded as a legal representative of the deceased-defendant can independently claim title to and interest in the property under a Will. The lower court had refused to permit Vidyawati to file her additional written statement and the Supreme Court took a view that whether the petitioner had an independent right, title or interest dehors the claim of the original first defendant was a matter to be gone into at a later stage of the proceedings. If the petitioner was impleaded as a party-defendant and all rights under Order XXII Rule 4(2) and defences available to the deceased-defendant became available to her. In addition, if the petitioner had any independent right, title or interest in the property, then she could get herself impleaded in the suit as a party-defendant and could then resist the claim made by the plaintiff or challenge the decree that have been passed in the suit. In the facts of Vidyawati, additional written statement sought to be filed claiming title and interest in the property under the Will, as aforesaid. The petitioner had not got herself impleaded in an independent capacity and therefore the courts did not allow her to file the additional written statement.

23. In Vidyawati (supra), the court also considered its discussion in Jagdish Chander Chatterjee Vs. Sri Kishan, (1972) 2 SCC 461 and Bal Kishan Vs. Om Parkash, (1986) 4 SCC 155. In Jagdish Chander Chatterjee (supra) , the court interpreted Order XXII Rule 4(2) to mean that, heirs and legal representatives could urge all contentions, which the deceased could have urged, except only those which were personal to the deceased. This did not prevent legal representatives from setting up their own independent title, in which case there could be no opposition to the court impleading them not merely as a legal representatives of the deceased, but also in their personal capacity. That would avoid a separate suit for a decision on the independent title.

24. In Bal Kishan (supra) , an additional written statement was filed by the legal heir asserting that the legal heir could not be treated as a tenant under the Haryana Urban (Control of Rent and Eviction) Act and that the legal heir was a trespasser and hence the tenancy court had no jurisdiction. The court rejected the defence. The Supreme Court, while considering the facts in the context of Order XXII Rule 4(2), held and observed that a person impleaded as a legal representative of a deceased-defendant and not otherwise in a personal capacity, cannot raise pleas which were personal to the deceased and even if court allows it to be impleaded in his personal capacity, the court cannot permit him to raise the pleas which would oust the jurisdiction of the court to try this issue.

25. In Abdul Razak (Dead), through LRs and Others Vs. Mangesh Rajaram Wagle and Others, (2010) 2 SCC 432, the judgments in Bal Kishan and Vidyawati were distinguished. In Abdul Razak (supra) , an additional written statement had been permitted to be filed by the lower court. The High Court struck-off the additional written statement; however, the Supreme Court found that the additional written statement had been taken on record without any objections from the respondents, who also led evidence keeping in view the pleadings. The High Court, it was found, was not justified in striking out the additional written statement and without considering Order VI Rule 16 of the CPC. The appeal was, therefore, allowed and the order of the High Court striking out the additional written statement was set aside. Thus, the court considered the issue of inconsistency of the additional written statement, when compared with the original written statement, and found that the additional written statement was not inconsistent with the earlier written statement. It is, therefore, clear that a legal heir is entitled to file his defence.

26. One of the submissions on behalf of the plaintiffs without prejudice to the absolute bar to filing a written statement canvassed by the plaintiff, was that this court should not permit written statement(s) to be filed, if contents do not comply with the limitations of Order XXII Rule 4(2) CPC to the extent it concerns the defence appropriate to his character as legal representative. The facts at hand do not require me to consider the contention on merits that defendant nos.5(a) to 5(c) might adopt in their written statements. In my view, it is not permissible at this stage to examine the scope of the written statement that is now proposed to be filed. We are presently concerned with the issue whether or not a legal heir can be permitted to file a written statement in the absence of the original defendant having omitted to file one and against whom the suit was to proceed as undefended.

27. From an analysis of all of the above, it is clear as daylight that a defendant, who is impleaded as legal representative of the deceaseddefendant, is entitled to take up a defence and such pleas and defence can be taken up only by filing a written statement. Whether such a written statement is in addition to the written statement filed by the original defendant or whether it is a written statement sought to be filed by the legal representatives after the suit was directed to be heard as an undefended suit, is not material. Even if the original defendant had not filed a written statement, as in the present case, the legal representatives – defendant nos.5(a) to 5(c) cannot be deprived of their right to file a written statement. It is another matter altogether as to the contentions that can be taken up by defendant nos.5(a) to 5(c), that will be open for consideration at an appropriate time; provided a written statement is filed. The plaintiffs’ attempt to thwart the filing of the written statement cannot be sustained for those reasons.In this view of the matter, I am of the opinion that defendant nos.5(a) to 5(c), in the present case, are entitled to file their written statements notwithstanding the order dated 22nd March 2019, which directs the suit to proceed undefended against defendant nos.1, 3, 4 and 5.

28. In view of the aforesaid, I pass the following order :-
(i) Defendant nos.5(a) to 5(c) to file their written statements within a period of one week from today. If contents of the written statements go beyond defences appropriate to their character as legal representatives of the deceased defendant, it will be open for the plaintiffs to question such defences.
(ii) As far as defendant no.2 is concerned, a request was made to permit defendant no.2 to file an additional written statement, consequent upon amendment. The amendment sought in the case is merely to bring on record the names of defendant nos.5(a) to 5(c) and deletion of defendant no.6. Therefore, no occasion arises to consider filing of an additional written statement merely due to the addition of the parties. The request is rejected.
(iii) At this stage, a request is made by learned counsel for the plaintiffs to stay implementation of this order. Request for stay is declined.