Sushil K. Chakravarty vs M/S Tej Properties P. Ltd.
2009 Latest Caselaw 3327 Del

        IN THE HIGH COURT OF DELHI AT NEW DELHI


                                     CS(OS) 1348 of 1996


        SUSHIL K. CHAKRAVARTY                       ..... Plaintiff
                      Through Mr. Rajesh Gupta with
                      Mr. Harpreet Singh, Advocate


                          versus


        M/S. TEJ PROPERTIES P. LTD.            ..... Defendant
                       Through Mr. Manoj Goel with
                       Mr. Shuvodeep Roy, Mr. Wajeeh Safiq and
                       Mr. Gopal verma, Advocates

                                     AND

                          CS(OS) 2501 of 1997


        M/S. TEJ PROPERTIES P. LTD.               ..... Plaintiff
                       Through Mr. Manoj Goel with
                       Mr. Shuvodeep Roy, Mr. Wajeeh Safiq and
                       Mr. Gopal verma, Advocates


                          versus

        SUSHIL K. CHAKRAVARTY                       ..... Defendant
                      Through Mr. Rajesh Gupta with
                      Mr. Harpreet Singh, Advocate


        CORAM:
        HON'BLE DR. JUSTICE S. MURALIDHAR

        1. Whether reporters of the local news papers
             be allowed to see the judgment?                 No


        2. To be referred to the Reporter or not?            Yes
        3. Whether the judgment should be reported in the    Yes

             Digest ?
                                      ORDER

24.08.2009

IA Nos.4531/2008 (restoration) & 4532/2008(delay) in CS(OS) 1348/1996

IAs10414/2009(direction) & 3391/08(u/O IX R 13) in CS (OS) 2501/1997

1. These applications arising out of the common set of facts in two suits and

therefore, are being disposed of by this common order.

2. The background to the present applications is that Mr. Sushil Kanta

Chakravarty filed a suit CS (OS) 1348 of 1996 against M/s. Tej Properties

Pvt. Ltd („TPPL‟), its Director Mr. Tejwant Singh @ Mr. T.S. Sabharwal

and Mr. Prabhjot Singh for a declaration of invalidity of an agreement to sell

dated 17th March 1992 whereunder the Plaintiff had agreed to sell to the

Defendants a land measuring 8 Bighas and 5 Biswas Khasra Nos. 1378 (4-

9), 1378 (3-16) situated in Village Chattarpur, Mehrauli, New Delhi together

with super structure thereon. The further prayer was for a decree of

possession in favour of the Plaintiff and against the Defendants in respect of

the suit property. Damages in the sum of Rs.40 lakhs was also claimed.

3. The Plaintiff Mr. Sushil Kanta Chakravarty expired on 3rd June 2003. On

14th October 2004 the suit was dismissed in default for non-prosecution.

Application IA No. 4531 of 2008 under Order IX Rule 9 read with Section

151 CPC accompanied by an application IA No. 4532 of 2008 under Section

5 of the Limitation Act seeking condonation of delay in filing the application

were filed by the present applicants i.e. Mr. Arun K. Chakravarty and Mr.

Sunil K. Chakravarty claiming to be legal heirs of the deceased Plaintiff Mr.

Sushil K. Chakravarty. In the applications it is stated that the applicants are

Class-II legal heirs of the deceased Plaintiff who expired on 3rd June 2003

leaving behind no Class-I heir. They claim that on his death, his estate has

passed on to the present applicants. It is further stated that applicants knew

about the Plaintiff having filed the present suit only towards the end of

February 2008 and thereafter, applied for a certified copy of the suit

proceedings which was made available to them on 26th February 2008.

Thereafter, they learnt of the other cases including the suit CS (OS) 2501 of

1997, filed by M/s. TPPL against late Mr. Sushil K. Chakravarty.

4. The applicants state that Sushil K. Chakravarty was a partner in a firm and

pursuant to the disputes arose between him and other partners, suit CS (OS)

1479-A of 1989 was filed in this Court against him by the other partners. By

an order dated 12th July 1989 passed in IA No. 4203 of 1989 in the said suit,

Sushil K. Chakravarty was restrained from alienating or transferring in any

manner or creating any third party interest in the suit property. The interim

order was made absolute on 31st August 1998. It is stated that the agreement

to sell dated 17th March 1992 acknowledged the pendency of the CS(OS)

No. 1479-A of 1989.

5. It requires to be noted that CS (OS) 1479-A of 1989 was directed to be

listed for hearing by this Court along with the another suit being CS (OS)

1275 of 1990 filed by the applicants herein against Sushil Kanta

Chakravarty. In the agreement to sell dated 17th March 1992 it was stated

that the firm M/s. ESPI Industrial Corporation, in which Sushil K.

Chakravarty was a partner, had taken a loan from the New Bank of India

(NBI) [subsequently taken over by Punjab National Bank (PNB)], for

recovery of which Suit being CS (OS) 1823 of 1988 had been filed in this

Court. As security for the loan the original title documents of the suit

property were kept with NBI. In the agreement to sell the Vendor (Sushil K.

Chakravarty) agreed to deal exclusively with the NBI to settle its dues from

his own resources before the registration for the sale deed of the suit

property in favour of the Vendee (TPPL). The agreement to sell dated 17th

March 1992 also noted that the Vendor had informed the vendee (TPPL) that

"disputes are going on with the ex-partners and has assured the vendee that

he will have the restrain order vacated in the IA No. 4203 of 1989 in Suit

No. 1479A of 1989........"

6. The applicants claimed that on 24th May 1996 this Court passed an order

in CS (OS) No. 1348 of 1996 restraining the Defendant i.e. TPPL from

alienating and/or parting with the possession of the suit property. It is stated

that without performing its obligation under the agreement to sell, TPPL

filed a suit being CS (OS) 2501 of 1997 in this Court on 13 th November

1997 seeking specific performance of the agreement to sell dated 17th March

1992. During the pendency of the CS (OS) 1479A of 1989 and CS (OS)

1348 of 1996 the Plaintiff Sushil K Chakravarty suffered a paralytic attack

in year 1997 and his health slowly deteriorated. It is claimed that he was not

in a position to instruct his lawyers and lost track of the cases. Eventually

due to ill-health Sushil K Chakravarty expired on 3rd June 2003.

7. It is claimed that since these facts came to the knowledge of the applicants

only sometime in February 2008, there is no delay in filing the application

under Order IX Rule 9 CPC seeking restoration of the suit and that of

substitution of the applicants in place of the Plaintiff under Order XXII Rule

3 CPC. Otherwise the delay is to the extent of 1168 days and 1668 days

respectively in seeking the said two reliefs.

8. As regards CS (OS) 2501 of 1997 filed by TPPL against Sushil K.

Chakravarty, on account of the non-appearance of Sushil K. Chakravarty, he

was set ex parte by an order dated 1st August 2000. This was long before the

date of his death. Thereafter the Plaintiff filed an affidavit by way of ex parte

evidence. This was noted in the order dated 9th December 2002 passed in the

said suit. After the death of Sushil K. Chakravarty, IA No. 9676 of 2003

under Order XXII Rule 4 (4) CPC was filed by TPPL stating that they were

not aware whether there were any legal representatives (LRs) of the

deceased Sushil K. Chakravarty. The said application was kept pending in

the proceeding. Later, I.A.9676 of 2003 was placed before the Court on 16th

January 2004 on which date it was directed to be heard along with the suit

itself. The Plaintiff‟s evidence was recorded on 28th January 2005.

9. On 9th August 2005 this Court noticed that the suit property had been

mortgaged to NBI which was now PNB. Notice was directed to issue to the

concerned Branch of PNB. On 4th May 2006 learned counsel for the PNB

appeared before the Court and confirmed that the property still remained

mortgaged and the amount owing in the relevant account was to the extent of

over Rs.10.47 crores. At the subsequent hearing on 27th July 2006 time was

sought by learned counsel for the Plaintiff for a settlement to be arrived at

with the PNB.

10. On 25th July 2007 this Court was informed by PNB that the Plaintiff had

cleared its dues and therefore, PNB would release the documents as directed

by this Court. The Plaintiff also undertook to give up all other claims against

PNB. The suit was decreed by the order dated 25th July 2007. In para 11 of

the said order this Court noticed that after the filing of the written statement

the Defendant Sushil K. Chakravarty had expired. This Court then took note

of the provisions of Order XXII Rule 4 (4) CPC and held that in the facts of

the present case despite the death of the Defendant judgment was liable to be

pronounced.

11. It is claimed by the applicants in IA No. 3391 of 2008 that they came to

know about the present suit [CS (OS) No. 2501 of 1997] only some time

towards the end of February 2008. Accordingly, the said application was

filed under Order IX Rule 13 read with Section 151 CPC setting aside the ex

parte judgment and decree dated 25th July 2007 passed by this Court.

12. The submissions of Mr. Rajesh Gupta, learned counsel for the applicants

and Mr. Manoj Goel, learned counsel for TPPL have been heard.

13. Learned counsel for the applicants submits that as far as IA No. 3391 of

2008 in CS (OS) 2501 of 1997 is concerned, the applicants are entitled to

succeed on two grounds. First there was a failure by this Court, while

passing the ex parte judgment and decree dated 25th July 2007, to take note

of the pendency of the IA No. 9676 of 2003 filed by the Plaintiff under

Order XXII Rule 4 (4) CPC. No order had been passed in the said

application prior to the decreeing of the suit. It is submitted that the failure to

comply with the mandatory requirement of the said provision vitiated the ex

parte judgment and decree. Reliance is placed on the decisions of the

Supreme Court in Zahirul Islam v. Mohd. Usman (2003) 1 SCC 476 and T.

Gnanvel v. T.S. Kanagaraj JT 2009 (3) SC 196 and of the Madras High

Court in Elisa v. A. Doss AIR 1992 Mad 159. The second ground urged is

that a perusal of the judgment shows that it suffers from a serious error

inasmuch as there is nothing to indicate whether the Plaintiff‟s readiness and

willingness to perform its part of contract was taken note of by the Court. It

is submitted that even though the defendants had been set ex parte, the Court

was under an obligation to examine the possible defence taken in the written

statement. Learned counsel for the applicants placed reliance upon

Bogidhola Tea & Trading Company Limited v. Hira Lal Somani (2007) 14

SCC 606, Balraj Taneja v. Sunil Madan (1999) 8 SCC 396 and Mahesh

Yadav v. Rajeshwar Singh (2009) 2 SCC 205.

14. As regards the IA Nos. 4531 and 4532 of 2008 in CS (OS) No. 1348 of

1996, it is submitted that the delay in filing the said application is bonafide

and that since the applicants had no knowledge of the pendency of the suit,

the delay must be condoned; the application under Order IX Rule 9 should

be allowed said suit must be restored to its file.

15. Learned counsel for TPPL [the Plaintiff in CS (OS) No. 2501 of 1997

and Defendant in CS (OS) 1348 of 1996] seriously contested the stand of the

applicants that they had no knowledge of the pendency of these suits. It is

pointed out that the Advocate for late Sushil K. Chakravarty had filed a

letter on 14th June 2003 stating that Sushil K Chakravarty had expired opn

3rd June 2003; that the deceased Plaintiff had executed at least two Wills (if

not more) and that the Advocate himself was a witness in at least one Will.

The said Advocate further informed that: "I am not very sure who the legal

heirs are who have to take part in this proceeding." The Advocate asked

"that as my vakalatnama is no longer valid, I need not appear in the

captioned proceeding." The said Advocate enclosed with the said intimation

a copy of the Will dated 8th June 1990 of Sushil K Chakravarty. In the said

Will the deceased Plaintiff stated that he did not have any Class-I legal heir

and that he did not desire that any of the assets which were his self acquired

properties should go to any person other than the Missionaries of Charity,

and the University of Delhi. Interestingly in para 4 of the Will Sushil K

Chakravarty stated:

"4. I want to make it clear that my executors will not make any payments to any of my relations and in no case the following persons will get any benefit -

(1) Mr. Sunil K. Chakrabarty - Brother

(2) Mrs. Arati Chakrabarty - wife of No.1.

(3)Mr. Samarjit Chakrabarty - Brother of No.2

(4) Mr. Amal Roy Choudhary - Ex Squadron Leader (my sister‟s son) who all have been responsible for incalculable suffering."

16. It is contended that in view of what was stated by late Sushil K

Chakravarty in para 4 of his Will, there could be no manner of doubt that the

applicants, who have been named therein, cannot claim to be his LRs much

less be permitted to inherit any part of his estate. It is further submitted that

the applicants had full knowledge of the pendency of these suits. The second

applicant Sunil K. Chakravarty was the Plaintiff in CS (OS) 1275 of 1990

filed against Sushil K Chakravarty. Sunil K. Chakravarty‟s wife (Arati

Chakravarty) and his brother-in-law (Samarjit Chakravarty) were parties in

CS (OS) No. 1479A of 1989. The said suits were clubbed and heard

together. CCP No. 450 of 1993 was filed by Sunil K. Chakravarty in CS

(OS) No. 1479A of 1989, stating that Sushil K. Chakravarty had, by entering

into the agreement to sell dated 17th March 1992 with TPPL, wilfully

disobeyed this Court‟s order in the said suit and was therefore, liable to be

punished for contempt of court. An application IA No. 10161 of 1997 in CS

(OS) No. 1479A of 1989 filed by Sunil K. Chakravarty showed that he knew

of the suits. Further, the records of CS (OS) No. 1348 of 1996 was called for

by this Court by an order dated 20th March 1998 in CS (OS) No. 1479A of

1989.

17. It is further pointed out that the applicants also knew of the Will

executed by late Sushil K Chakravarty since that fact was brought on record

in OA No. 797 of 1995 before the Debt Recovery Tribunal („DRT‟) in

which the applicant No. 2 Sunil Kumar Chakravarty was Respondent No.3.

A copy of the Will was placed on record by the Advocate representing

Sushil K. Chakravarty in CS (OS) No. 2501 of 1997. All these facts showed

that the applicants throughout knew of the pendency of the aforesaid suits.

18. It is stated that the applicants have acted in collusion by entering into a

compromise on the basis of which the CS (OS) 1479A of 1989 was decreed

on 11th November 2005. One of the terms of compromise was that in the first

instance a sum of Rs.40 lakhs owing to PNB would be paid by the parties to

the compromise i.e. two applicants. It is submitted that this compromise was

arrived at despite applicants being fully aware of the pendency of the suit i.e.

CS (OS) 2501 of 1997. Learned counsel for the TPPL, accordingly, prays

that applicant‟s applications should be dismissed with exemplary costs.

19. The submissions of learned counsel for the parties have been considered.

One of the grounds on which the applicants assail the ex parte judgment and

decree dated 25th July 2007 in CS (OS) 2501 of 1997 is that this Court did

not take note of the requirement of Order XXII Rule 4 (4) CPC. The said

provision reads as under:

"XXII Death, Marriage and Insolvency or parties -

4. Procedure in case of death of one of several defendants or of sole defendant (1) to (3) .....

(4) The Court whenever it thinks fit, may exempt the plaintiff from the necessity of substituting the legal representatives of any such defendant who has failed to file a written statement or who, having filed it, has failed to appear and contest the suit at the hearing; and judgment may, in such case, be pronounced against the said defendant notwithstanding the death of such defendant and shall have the same force and effect as if it has been pronounced before death took place."

20. It is a matter of record that TPPL did file an application being IA No.

9676 of 2003 on 15th September 2003 in CS(OS) 2501 of 1997 under Order

XXII Rule 4 CPC. The Plaintiff TPPL stated therein that it was not aware

whether there were any legal heirs of the Defendant. Accordingly, it was

prayed that this Court should direct that the said suit should be proceeded

with ex parte without substitution of the deceased Defendant by his LRs.

The said application was taken note of by the Joint Registrar in the orders

dated 24th September 2003 and 10th December 2003. It was listed before the

Court on 16th January 2004 on which date the application was directed to be

listed with the main suit. In the circumstances, it cannot be said that the

Plaintiff did not take steps to seek relief in terms of provision of Order XXII

Rule 4 (4) CPC.

21. The ground stated in the application that the Plaintiff was not aware if

there was any legal heir of the deceased Defendant late Sushil K

Chakravarty was consistent with the letter dated 14th June 2003 written by

his Advocate which was placed on record in CS (OS) No. 1348 of 1996 to

which TPPL was a party. Therefore, it too received a copy of the Will dated

8th June 1990 enclosed with the said letter. In the said Will Sushil K

Chakravarty categorically stated that he did not have a Class-I legal heir and

that he did not desire that any of his assets which were self acquired

properties should go to any person other than the Missionaries of Charity

and the Delhi University. Consequently, the ground on which the provision

of Order XXII Rule 4 CPC was sought to be invoked was perfectly in order.

22. The only question remains to be considered is whether the Court erred in

not first disposing of the said application IA No.9676 of 2003 before

decreeing the suit. In the considered view of this Court in para 11 of the

judgment and decree dated 25th July 2007 not only did the Court notice

Order XXII Rule 4 CPC but formed a definite opinion that the said provision

had to be invoked and the suit proceeded with notwithstanding the fact that

the Defendant (Sushil K Chakravarty) had died. What appears to have

weighed with this Court was that the provisions of Order XXII Rule 4 (4)

CPC suggests that the Court may exempt the Plaintiff from the necessity of

substituting the legal representatives of any such Defendant who has failed

to file a written statement or who having filed it has failed to appear and

contest the suit and the judgment in such a case may be pronounced,

notwithstanding the death of the such Defendant, and that such judgment

shall have the same force as it would have had it been pronounced before the

death took place.

23. The judgment in Elisa v. A. Doss (supra) reiterated that the order

granting exemption in terms of Order XXII Rule 4 (4) CPC has to precede

the judgment. It was held that it was not necessary for the Plaintiff to file a

written application asking for such exemption. Given the sequence evident

from the judgment and decree dated 25th July 2007 there can be no manner

of doubt that the Court first formed an opinion that the plaintiff should be

exempted from substituting the deceased Defendant in terms of Order XXII

Rule 4 (4) CPC and thereafter proceeded to decree the suit. The judgments

in Zahirul Islam v. Mohd. Usman (supra) and T. Gnanvel v. T.S.

Kanagaraj (supra) do not hold anything to the contrary. They only reiterate

the necessity for compliance with Order XXII Rule 4 (4) CPC before the

judgment is pronounced. In the considered view of this Court the judgment

and decree dated 25th July 2007 passed by this Court is fully compliant with

the requirements of Order XXII Rule 4 (4) CPC. There is accordingly no

merit in this ground.

24. There is no merit in the objection that the judgment and decree dated 25th

July 2007 does not account for the readiness and willingness of the Plaintiff

to comply with its part of the obligation. The very first line of the judgment

and decree noticed the submission of learned counsel for the PNB that "The

Plaintiff has cleared the dues of the Bank insofar as the mortgage of the

property is concerned .........." If the Plaintiff was not in a position to

honour its commitment under the agreement to sell, there was no question of

the Plaintiff clearing the dues of the Bank to the extent of several crores. It is

plain that the Court was conscious of Plaintiff‟s willingness and readiness to

comply with its obligation under the agreement to sell. The judgments relied

upon by the Plaintiff in Bogidhola Tea & Trading Company Limited v.

Hira Lal Somani (supra) and Mahesh Yadav v. Rajeshwar Singh (supra) do

not held anything to the contrary.

25. This Court is not at all satisfied with the reasons given by the applicants

for the delay in filing these applications. The ground that they were not

aware of the pendency of these suits and they became aware only sometime

in February 2008 does not inspire confidence. The facts brought on record

by the Plaintiff (TPPL) show that the applicants were aware of these

proceedings even during the earlier rounds of litigation involving late Sushil

K Chakravarty to which they were also parties. Therefore, reasons given for

the delay in approaching the Court are not satisfactory.

26. For the aforementioned reasons, these applications are dismissed with

costs of Rs. 30,000/- which will be paid by the applicants to the Plaintiff

(TPPL) in CS (OS) No. 2501 of 1997 through counsel within a period of two

weeks from today.

S. MURALIDHAR, J.

AUGUST 24, 2009 rk