An ex parte summary decree may be set aside conditionally upon substantial security for the plaintiff.

The respondent obtained an ex parte decree in a summary suit under Order XXXVII CPC on 17 December 2019.

The petitioner said he learned of the suit and decree only on 23 December 2020.

He applied under Order XXXVII Rule 4 CPC to set aside the decree, relying on the Supreme Court’s COVID-19 limitation exclusions, but did not file an accompanying application to condone delay.

The Trial Court dismissed the application, finding that the COVID-19 orders did not assist him and that the failure to seek condonation was fatal.

The petitioner challenged that dismissal under Article 227, also contending that the suit itself was time-barred.

Whether the Trial Court’s dismissal of the petitioner’s Order XXXVII Rule 4 application disclosed an illegality or infirmity warranting interference under Article 227.

Whether the petitioner should nevertheless be permitted to contest the summary suit on the merits, subject to conditions, given his defence that the suit was time-barred.

Order XXXVII Rules 1 and 2 CPC provide for the summary procedure invoked in the suit; Order XXXVII Rule 4 was the provision under which the petitioner sought to set aside the ex parte decree.

Article 227 of the Constitution was invoked to challenge the Trial Court’s order.

The Court referred to the Supreme Court’s COVID-19 limitation orders, which excluded the period from 15 March 2020 to 28 February 2022, but upheld the Trial Court’s conclusion that those orders did not cure the petitioner’s failure to file an application for condonation of delay.

The Court nonetheless considered whether an opportunity to contest the suit could be granted on suitable terms.

The Court found no illegality or infirmity in the Trial Court’s dismissal of the Rule 4 application and did not disturb its conclusions on delay or the COVID-19 limitation orders.

However, considering the petitioner’s specific defence that the suit was time-barred, the Court concluded that he could be given an opportunity to contest the suit if the respondent’s interests were substantially secured.

It therefore made relief conditional on a deposit of ₹50 lakh, being the principal amount claimed as borrowed.

If the petitioner deposits ₹50 lakh to the credit of the suit within eight weeks of receiving the order, either in one payment or two equal instalments, the ex parte decree will stand set aside and conditional leave to defend will operate.

The petitioner was directed to file his written statement without waiting for the deposit; the Trial Court was to prepare the case for trial and dispose of it by 2 April 2027.

The deposit is to be invested in an interest-bearing deposit for the benefit of the successful party.

If the condition is not met, the Trial Court’s order stands confirmed and the respondent may execute the decree.