Ripan Wadhwa vs Sun Pharmaceutical Industries ...
2003 Latest Caselaw 292 Del

JUDGMENT

Vikramajit Sen, J.

1. By this Order, I shall dispose off the Defendant's/Judgment Debtor's application for setting aside the ex-parte decree dated 19.2.1996 (IA No. 10507/01); application under Section 5 of the Limitation Act for condoning the delay in filing the application (IA No. 10508/01) and application under Section 151 of the CPC for stay of execution proceedings (IA No. 10509/01).

2. This Suit for permanent injunction restraining passing off, rendition of accounts of profits, deliver up, etc. was filed in 1994. Summons/notices were dispatched in August, 1994 and were served in that very month, both by registered A.D. post as well as through the Baliff. On the second date of hearing, i.e. on 1.1.1994, the Defendant was represented by counsel who also appeared on 29.11.1994, 23.3.1995 and 15.9.1995. On these dates, the hearing was adjourned on the statement that the parties were endeavoring to compromise their disputes. There was no appearance on behalf of the Defendant on 27.11.1995 and when the case was listed before the Court thereafter on 12.2.1996, the Defendants were set ex-parte, as there was no representation on their behalf once again. The Suit was decreed on 19.2.1996. On 8.11.2001, notice of all these three applications was ordered Pleadings have been completed and I have heard learned counsel for the parties in detail.

3. The contention of the applicants, who are Judgment Debtors, is that they became aware of the decree passed ex-parte against it "only in the first week of October when it received the notices issued by the Hon'ble Court dated 18.9.2001 in the execution proceedings (Ex.No. 128/2001) moved by the Decree-Holder against the applicant". This statement is not correct since it is the admitted case of the applicant that they have received the summons and notices of the Suit in August, 1994 itself. It has been averred that the then General Manager (Tax Department), who was also looking after the legal affairs of the applicant, did not convey the receipt of the notice to the applicant and, instead, gave oral instructions to a counsel who appeared on its behalf. Secondly, it has also been pleaded that "on oral instructions of Mr. A.K. Aggarwal, the counsel appearing for the applicants side informed the Hon'ble Court on 29.11.1994 that the matter was likely to be compromised". It has next been pleaded that the applicant shifted its office in 1996 from Vipro Pali, East Mumbai to Andheri, East Mumbai. Mr. A.K. Aggarwal was asked to resign in 1999, as his services were found to be unsatisfactory. In the meanwhile, Mr. Vijay Shah had been employed as Senior Executive (Legal) in the year 1997. These facts are repeated in all the applications which have been vehemently opposed by the Plaintiff/Decree-holder.

4. It is also contended that since the execution proceedings were initiated after some delay, these applications should be viewed with leniency, as the Plaintiffs lack of urgency and diligence is palpably evident. In this respect, the effect of initiating execution proceedings after two years of the passing off the decree is that the law requires notice to be served on the Judgment Debtor. I am unable to appreciate any other disability or inconvenience that should visit the Decree-holder.

5. It has been reiterated by Mr. Sundaram, learned Senior Counsel appearing on behalf of the applicants, that they became aware of the ex-parte decree in September, 2001. Their argument is that although the decree has been passed in 1996, for over five years, no execution proceedings were initiated. This was indicative of the fact that the Plaintiff did not perceive any urgency in the matter. Since the Plaintiff had failed to implement and enforce its rights under the decree for this inordinately long period, the prejudice that would be caused if the decree is set aside would be insignificant. These applications have been vehemently opposed on behalf of the Plaintiff.

6. In the present case, there are two defaults of the Defendant. Firstly, its failure to prosecute the Suit and secondly to have the ex parte orders set aside. From the case set-out by the Applicant I am of the view that no laxity is called for on equitable ground and no cause is shown on legal parameters for granting the relief. Parties are sound commercial concerns, who have engaged professional executives. The default of Mr. R. K. Aggarwal cannot be over-looked, especially in view of the fact that he had given instructions to bring about a compromise. It is impossible to believe that he acted on his own initiative without sharing the information regarding the pendency of the Suit with any other official, it can properly and fairly be expected that on the induction of Mr. Vijay Shah, Senior Executive (Legal) in 1997, all pending litigations would have been reviewed. Even if a smattering of diligence had been taken at

this stage by the Defendant, it would have come to learn of the ex parte decree. Negligence cannot be accorded any premium or indulgence. If the decrees are to be set aside in the circumstances shown by the applicant, it would give a fillip and encouragement to the parties to a litigation interested in delaying proceedings, such parties could adopt a strategy of allowing the suits to be decreed, and thereafter praying that the ex parte decree be set aside on flippant grounds. Some laxity has been advocated by the Supreme Court on equitable consideration i.e., where the party concerned is an uneducated individual. Indulgence may also reasonably be extended where the Government is involved, since its officers do not have any personal interest in the litigation, and quite often may be motivated in many manners to permit the interests of the Government to be over-looked. This is as far as exceptions go. In any event the summons were not received by Mr. R.K. Aggarwal alone, and the record bears out that the summons were received by Mr. N.V.K. Anujan, who is stated to be the authorised signatory in possession of the sea! of the Defendant company. No explanation for his inaction.

7. Furthermore, there is a statement in the application itself that the defendants have not used the trademark 'AZTEC', which is the subject-matter of the Suit. For all these reasons, I find that there is no merit in the applications, which are dismissed. Ordinarily, costs would have been imposed against the Defendants/applicants, but in view of the fact that the Decree-holder has itself delayed in filing of the Execution, I refrain from doing so.