Full Judgment Text
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CASE NO.:
Appeal (civil) 2538 of 2003
PETITIONER:
Rajni Kumar
RESPONDENT:
Suresh Kumar Malhotra & Anr.
DATE OF JUDGMENT: 28/03/2003
BENCH:
Syed Shah Mohammed Quadri & Ashok Bhan.
JUDGMENT:
J U D G M E N T
(Arising out of S.L.P. (C) No.22588 of 2001)
Syed Shah Mohammed Quadri, J.
Leave is granted.
In this appeal, from the Judgment and Order of the High
Court of Delhi in C.R. No.138 of 2001 dated October 15, 2001,
the short point that arises for consideration is : whether the
High Court committed jurisdictional error in declining to set
aside the ex parte decree on the application of the appellant
under Rule 4 of Order 37, on the ground that he failed to
disclose facts sufficient to entitle him to defend the suit.
The facts relevant for the disposal of this appeal may be
noted here.
The appellant-tenant had taken on rent residential flat
No.C 470, Sarita Vihar, Ground Floor, New Delhi - 110 004,
from the respondent-landlord for a period of nine months under
an agreement of lease reduced to writing on November 26,
1993. After the expiry of the term of tenancy she continued to
occupy the said premises as tenant till January 11, 1997.
Alleging that the appellant did not pay the electricity and water
consumption charges for the period starting from November 26,
1993 to January 11, 1997, the respondent filed suit No.597 of
1997 in the Court of Senior Civil Judge, Delhi, under Order 37
of Code of Civil Procedure (C.P.C.), for recovery of Rs.33,661.
On the ground that on April 21, 1999 summons for judgment
was sent by registered post A.D. to the appellant pursuant to the
order of the Court dated April 16, 1999 the Court drew
inference of deemed service on him, proceeded with the case
and decreed the suit ex parte on August 12, 1999. The
appellant, however, filed application under Rule 4 of Order 37
C.P.C. in the trial court to set aside the ex parte decree. On
January 6, 2001, the application was dismissed as no special
circumstances were stated in the petition both in regard to there
being illegality in deeming service of summons for judgment on
the appellant as well facts sufficient to entitle him to defend the
suit. Aggrieved by the order of the trial court, the appellant
filed revision C.R.No.138 of 2001 in the High Court, which
was also dismissed on October 15, 2001. That order of the High
Court is assailed in appeal before us.
Mr.A.Sharan, learned senior counsel appearing for the
appellant, strenuously contended that there was no proof or
record to show that any notice by registered post with
acknowledgment due was issued to the appellant by the
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respondent who had taken the notice from the court but did not
file any proof of issuing the notice to the appellant, therefore,
there was special reason for the appellant not to appear in
response to the summons for judgment. He argued that
sufficient amount was deposited with the respondent as advance
and that Order 37 C.P.C. was not applicable to the facts of the
case, therefore, the appellant had good defence to the suit. The
trial court as well as the High Court, submitted Mr.Sharan,
erred in dismissing the application under Rule 4 of Order 37
C.P.C.
The respondent appeared in-person and argued his case
with precision and perfection. He submitted that summons for
judgment was issued on April 21, 1999 and that the court had
rightly drawn presumption of service on the appellant; that
nowhere in her application had the appellant stated anything
about her defence to the suit and therefore the order under
challenge was rightly passed by the courts below.
To appreciate the contentions of the parties it would be
useful to refer to Rule 4 of Order 37 C.P.C. which is in the
following terms :
"Order XXXVII -Summary Procedure
(1) to (3) xxx xxx xxx
(4) Power to set aside decree - After decree the
Court may, under special circumstances, set aside
the decree, and if necessary stay or set aside
execution, and may give leave to the defendant to
appear to the summons and to defend the suit, if it
seems reasonable to the Court so to do, and on
such terms as the Court thinks fit."
A careful reading of Rule 4 shows that it empowers,
under special circumstances, the court which passed an ex parte
decree under Order 37 to set aside the decree and grant one or
both of the following reliefs, if it seems reasonable to the court
so to do and on such terms as the court thinks fit :
(i) to stay or set aside execution and
(ii) to give leave to the defendant (a) to appear
to the summons and (b) to defend the suit.
The expression ’special circumstances’ is not defined in
the C.P.C. nor is it capable of any precise definition by the
court because problems of human beings are so varied and
complex. In its ordinary dictionary meaning it connotes
something exceptional in character, extra-ordinary, significant,
uncommon. It is an antonym of common, ordinary and general.
It is neither practicable nor advisable to enumerate such
circumstances. Non-service of summons will undoubtedly be a
special circumstance. In an application under Order 37, Rule
4, the court has to determine the question, on the facts of each
case, as to whether circumstances pleaded are so unusual or
extra ordinary as to justify putting the clock back by setting
aside the decree; to grant further relief in regard to post-decree
matters, namely, staying or setting aside the execution and also
in regard to pre decree matters viz., to give leave to the
defendant to appear to the summons and to defend the suit.
In considering an application to set aside ex parte decree,
it is necessary to bear in mind the distinction between suits
instituted in the ordinary manner and suits filed under Order 37
C.P.C. Rule 7 of Order 37 says that except as provided
thereunder the procedure in suits under Order 37 shall be the
same as the procedure in suits instituted in the ordinary manner.
Rule 4 of Order 37 specifically provides for setting aside
decree, therefore, provisions of Rule 13 of Order 9 will not
apply to a suit filed under Order 37. In a suit filed in the
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ordinary manner a defendant has the right to contest the suit as
a matter of course. Nonetheless, he may be declared ex parte if
he does not appear in response to summons, or after entering
appearance before framing issues; or during or after trial.
Though addressing arguments is part of trial, one can loosely
say that a defendant who remains absent at the stage of
argument, is declared ex parte after the trial. In an application
under Order 9 Rule 11, if a defendant is set ex parte and that
order is set aside, he would be entitled to participate in the
proceedings from the stage he was set ex parte. But an
application under Order 9 Rule 13 could be filed on any of the
grounds mentioned thereunder only after a decree is passed ex
parte against defendant. If the court is satisfied that (1)
summons was not duly served, or (2) he was prevented by
sufficient cause from appearing when the suit was called for
hearing, it has to make an order setting aside the decree against
him on such terms as to cost or payment into court or otherwise
as it thinks fit and thereafter on the day fixed for hearing by
court, the suit would proceed as if no ex parte decree had been
passed. But in a suit under Order 37 the procedure for
appearance of defendant is governed by provisions of Rule 3
thereof. A defendant is not entitled to defend the suit unless he
enters appearance within ten days of service of summons either
in person or by a pleader and files in court an address for
service of notices on him. In default of his entering an
appearance, the plaintiff becomes entitled to a decree for any
sum not exceeding the sum mentioned in the summons together
with interest at the rate specified, if any, upto the date of the
decree together with costs. The plaintiff will also be entitled to
judgment in terms of sub-rule (6) of Rule 3. If the defendant
enters an appearance, the plaintiff is required to serve on the
defendant a summons for judgment in the prescribed form.
Within ten days from the service of such summons for
judgment, the defendant may seek leave of the court to defend
the suit, which will be granted on disclosing such facts as may
be deemed sufficient to entitle him to defend and such leave
may be granted to him either unconditionally or on such terms
as the court may deem fit. Normally the court will not refuse
leave unless the court is satisfied that facts disclosed by the
defendant do not indicate substantial defence or that defence
intended to be put up is frivolous or vexatious. Where a part of
the amount claimed by the plaintiff is admitted by the defendant
to be due from him, no leave to defend the suit can be granted
unless the admitted amount is deposited by him in Court.
Inasmuch as Order 37 does not speak of the procedure when
leave to defend the suit is granted, the procedure applicable to
suits instituted in the ordinary manner, will apply.
It is important to note here that the power under Rule 4 of
Order 37 is not confined to setting aside the ex parte decree, it
extends to staying or setting aside the execution and giving
leave to appear to the summons and to defend the suit. We may
point out that as the very purpose of Order 37 is to ensure an
expeditious hearing and disposal of the suit filed thereunder,
Rule 4 empowers the court to grant leave to the defendant to
appear to summons and defend the suit if the Court considers it
reasonable so to do, on such terms as court thinks fit in addition
to setting aside the decree. Where on an application, more than
one among the specified reliefs may be granted by the Court all
such reliefs must be claimed in one application. It is not
permissible to claim such reliefs in successive petitions as it
would be contrary to the letter and spirit of the provision. That
is why where an application under Rule 4 of Order 37 is filed to
set aside a decree either because the defendant did not appear in
response to summons and limitation expired, or having
appeared, did not apply for leave to defend the suit in the
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prescribed period, the court is empowered to grant leave to
defendant to appear to the summons and to defend the suit in
the same application. It is, therefore, not enough for the
defendant to show special circumstances which prevented him
from appearing or applying for leave to defend, he has also to
show by affidavit or otherwise, facts which would entitle him
leave to defend the suit. In this respect, Rule 4 of Order 37 is
different from Rule 13 of Order 9.
Now adverting to the facts of this case, though appellant
has shown sufficient cause for his absence on the date of
passing ex parte decree, he failed to disclose facts which would
entitle him to defend the case. The respondent was right in his
submission that in the application under Rule 4 of order 37, the
appellant did not say a word about any amount being in deposit
with the respondent or that the suit was not maintainable under
Order 37. From a perusal of the order under challenge, it
appears to us that the High Court was right in accepting
existence of special circumstances justifying his not seeking
leave of the court to defend, but in declining to grant relief
since he had mentioned no circumstances justifying any
defence.
In this view of the matter, we do not find any illegality
much less jurisdictional error in the order under challenge to
warrant interference of this Court. Inasmuch as having regard
to the provisions of Section 34 of the C.P.C. and the facts of the
case that the liability does not arise out of a commercial
transaction, we are of the view that the grievance of the
appellant with regard to rate of interest is justified. We,
therefore, reduce the rate of interest from 18 per cent to 6 per
cent per annum.
We directed the appellant to deposit the decree amount to
serve as security for the suit amount in the event of this Court
granting him leave to defend the suit. Since that relief is not
granted to him, it will be open to him to withdraw the said
amount or have it adjusted in satisfaction of the decree.
Subject to above modification of the order of the trial
court as confirmed by the High Court the appeal is dismissed.
No costs