M/S. Dvh Industries vs M/S. Hartley Knits & Ors.
2009 Latest Caselaw 2011 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+     FAO(OS) No.138/2009 & CM No.5342/2009

#     M/S. DVH INDUSTRIES                 ..... Appellant
                              Through:    Mr.Vikas Dhawan with
                                          Mr. Ravi Gupta &
                                          Mr. V.K. Malik, Advs.

                  versus

$     M/S. HARTLEY KNITS & ORS.           ...... Respondent
^                         Through:        Mr.S.C. Maheshwari,
                                          Sr. Adv. with Mr. H.C.
                                          Kharbanda & Mr. Jabar
                                          Singh, Advs.

                        Date of Hearing : April 23, 2009

%                       Date of Decision : May 13, 2009

      CORAM:
*     HON'BLE MR. JUSTICE VIKRAMAJIT SEN
      HON'BLE MR. JUSTICE RAJIV SHAKDHER
      1. Whether reporters of local papers may be
         allowed to see the Judgment?                 Yes
      2. To be referred to the Reporter or not?       Yes
      3. Whether the Judgment should be reported
         in the Digest?                               Yes

VIKRAMAJIT SEN, J.

1. The annals of the litigation are required to be placed in

proper perspective. A suit for Mandatory Injunction was filed by

the Respondent before us, namely, M/s.Hartley Knits. The Suit was

valued at Rupees 5,01,000/- and a Court Fee of Rupees 7,800/- was

affixed. However, in the so-called Suit for Mandatory Injunction it

has been prayed to the Court to "(a) pass a decree for

US$1,27,085.50 with interest at the rate of 20 per cent per annum

against the Defendants and (b) pass such other and further orders

as this Hon‟ble Court may deem fit and proper in the facts and

circumstances of the case". On the very first hearing, the valuation

was found to be deficient and the Plaintiff was called upon to make

good the deficiency of Court Fee. On this being done, on 4.9.2000

Summons were issued to the Defendants. Defendants No.1, 2 and 3

entered appearance on 6.11.2000. The Appellant, who was

originally arrayed as Defendant No.2, filed a Written Statement

dated 25.9.2002. Noting that Defendant No.2 had admitted that it

had received US$76928.48 in connection with this very

transaction, the Court had restrained that Defendant, who is the

Appellant before us, from making payment of US$76928.48 to any

person except the Plaintiff. By Orders dated 4.9.2002 the

Appellant/Defendant No.2 was directed to remit the said sum of

US$76928.48 to the Registrar-General of this Court. This Order

was unsuccessfully challenged before the Division Bench of this

Court and the further appeal to the Supreme Court was dismissed

as withdrawn on 14.8.2003.

2. On 19.8.2003 the Joint Registrar erroneously observed that

the suit had been valued for the purposes of Court Fee and

jurisdiction below Rupees 20,00,000/- and, therefore, it was liable

to be transferred to the District Court, Delhi. All the parties, which

included Defendant No.2, who was represented at that hearing,

were directed to appear before the District and Sessions Judge,

Delhi on 6.11.2003. Obviously, the Joint Registrar had lost sight of

the fact that the deficiency in Court Fee had been made up and

that the suit was for recovery of US$76928.48 which was

indubitably above Rupees 20,00,000/-. On 26.10.2004, the Suit was

transferred back to the High Court of Delhi in the presence of

learned counsel for the Plaintiff and the Defendant No.1.

3. The Suit was dismissed for non-appearance on behalf of the

Plaintiff on 20.9.2005, on which date only the former Defendant

No.1 was present. On 25.10.2005 the Plaintiff‟s application for

restoration of the suit was allowed in view of the statement made

by learned counsel for the erstwhile Defendant No.1 that it has no

objection to the prayer being allowed. A perusal of the suit

proceedings discloses that Defendant No.2 had stopped appearing

in the hearings at the suit after 19.8.2003, that is, after the

withdrawal of the Special Leave Petition challenging the Order

directing it to deposit the sum of US$76928.48. Issues were

framed on 8.12.2005 in the presence of Plaintiff and Defendant

No.1. Thereafter, by Orders dated 31.7.2006 the application filed

by Defendant No.1 was allowed and it was deleted from the Array

of Parties. Consequently, the original Defendant No.2, the

Appellant before us, became Defendant No.1 in the Suit. On a

subsequent hearing, the learned Single Judge observed that

Summons in the suit post its restoration have not been issued to

Defendants No.2 and 3 (by then Defendant No.1 and Defendant

No.2 respectively) and for that reason fresh summons were

ordered, returnable for 6.11.2006. However, no summons were

issued by the said date and the Joint Registrar again passed fresh

orders for issuance of the summons on 2.5.2007. Thereafter, on

27.7.2007 time was given to the learned counsel of the plaintiff to

file the Report submitted to him by the courier company, certifying

that the Appellant stood served. On 13.08.2007, an Affidavit of

service was filed by the Plaintiff stating that Defendant

No.2/Appellant had been served through courier as well as by

electronic mail. The Report of the Courier has been placed on the

record. Since nobody had appeared for the Defendants, the case

was put up for hearing on 10.12.2007. The Suit was decreed in

favour of the Plaintiff and against the Defendants jointly and

severally by Judgment dated 10.12.2007 for the recovery in Indian

Rupees of a sum equivalent to US$1,27,085.50 together with

simple interest at the rate of 7 per cent per annum and costs of

Rupees 51,416/-.

4. IA No.1834/2006 under Order IX Rule 13 CPC was filed by

the Appellant on 15.1.2008 praying for recalling the ex parte

Judgment and Decree dated 10.12.2007. This application has been

supported by the Affidavit of Mr. Hasmukh Khatri, President of the

Appellant. After several hearings, IA No.14722/2008 was filed on

behalf of the Plaintiff/Decree Holder praying for the release to it of

the amount deposited by the Judgment Debtor. By means of the

impugned Order, IA No.1834/2006 under Order IX Rule 13 was

dismissed and IA No.14722/2008 filed by the Plaintiff was allowed,

thereby ordering the release of US$76928.48 to the

Plaintiff/Decree Holder.

5. Arguments have been addressed before us to the effect that

Notice of the application for restoration ought to have been served

on the Appellant before it could have been allowed. However, since

the Appellant/Defendant No.1 was not present at the hearing when

the suit was originally dismissed, that is 20.9.2005, we are of the

view that Order IX Rule 4 is the provision of the Code of Civil

Procedure, 1908 which stands attracted and not Order IX Rule 9

thereof as contended by learned counsel for the Appellant. We find

support for this view in Damu -vs- Vakrya, (1920) ILR 44 Bom 767

and Makundi -vs- Parbhu, AIR 1926 All 179. With profound

respect, the distinction drawn by the Orissa High Court in the case

of Ratnakar Ray -vs- Kulamoni Roy, AIR 1951 Orissa 266 does not

alter the situation. The relevant provisions of Order IX are

reproduced in juxtaposition in order to highlight all the nuances of

the conundrum in contemplation:

Order IX Rule 2 - Dismissal Order IX Rule 8 - Procedure of suit where summons not where defendant only served in consequence of appears - Where the defendant plaintiff's failure to pay costs appears and the plaintiff does

- Where on the day so fixed it is not appear when the suit is found that the summons has not called on for hearing, the Court been served upon the defendant shall make an order that the suit in consequence of the failure of be dismissed, unless the

the plaintiff to pay the court-fee defendant admits the claim, or or postal charges, if any, part thereof, in which case the chargeable for such service, or Court shall pass a decree failure to present copies of the against the defendant upon such plaint as required by rule 9 of admission, and, where part only Order VII, the Court may make of the claim has been admitted, an order that the suit be shall dismiss the suit so far as it dismissed. relates to the remainder.

Order   IX    Rule    3    -        Where
neither party appears, suit to be
dismissed - Where neither party
appears when the suit is called
on for hearing, the Court may
make an order that the suit be
dismissed.

Order IX Rule 4 - Plaintiff Order IX Rule 9 - Decree may bring fresh suit or may against plaintiff by default restore suit to file - Where a bars fresh suit - (1) Where a suit is dismissed under Rule 2 of suit is wholly or partly dismissed Rule 3, the plaintiff may (subject under Rule 8, the plaintiff shall to the law of limitation) bring a be precluded from bringing a fresh suit; or he may apply for fresh suit in respect of the same an order to set the dismissal cause of action. But he may aside, and if he satisfies the apply for an order to set the Court that there was sufficient dismissal aside, and when it cause for such failure as is satisfies the Court that there referred to in Rule 2, or for his was sufficient cause for his non- non-appearance, as the case appearance when the suit was may be, the Court shall make an called on for hearing, the Court order setting aside the dismissal shall make an order setting and shall appoint a day for aside the dismissal upon such proceeding with the suit. terms as to costs or otherwise as

it thinks fit, and shall appoint a day for proceeding with the suit.

(2) No order shall be made under this Rule unless notice of the application has been served on the opposite party.

6. The absence of a provision akin to sub-rule (2) of Order IX

Rule 9 requiring notice to be issued to the opposite party as a

prerequisite, in Order IX Rule 4 is indeed conspicuous by absence,

and cannot but lead to the conclusion that notice is required to be

issued only to the party which is actually present at the hearing on

which the dismissal of the suit occurred. If this was not the

intention of the Legislature, it would have mandated the issuance

of a notice even under Rule 4 of Order IX. The CPC in Order IX

itself specifically postulates situations where some of the plaintiffs

or defendants, as the case may be, are absent, and permits

different treatment in that regard. This discussion is necessary

since it has been contended by learned counsel for the Appellant

that the concession made by learned counsel for the erstwhile

defendant No.1 for restoration of the suit could not be legally

efficacious so far as the Appellant is concerned, and that the

application for the restoration of the suit should have been decided

only after notice and hearing of the application. In our view, this

argument is fallacious since the Appellant was not present on the

date of hearing when the suit came to be dismissed.

7. The course adopted by the learned Single Judge is

unassailable. It will be recalled that only the erstwhile Defendant

No.1, namely, A.C.S. Logistics was represented on 20.9.2005 when

the suit was dismissed for non-appearance of the Plaintiff. The

present Appellant/Defendant No.1 was absent, and therefore was

not legally entitled to be served once again. A modicum of

diligence would indubitably have enabled the Appellant to follow

the progress of the suit including the Court to which it had been

transferred and retransferred. Requisite information is always

available in the transferor Court. Even if a party is absent on one

date of hearing, information regarding the date to which

proceedings stand adjourned is not difficult to ascertain. A problem

may arise if the subject suit or application is decided on the very

date on which a particular party is absent but legal remedies have

been duly provided. When a Judge is absent on a particular date,

and the Court official/Reader adjourns proceedings for „proper

orders‟, on the adjourned date the suit cannot legally be dismissed,

or defendant(s) set ex parte or the suit/application be allowed, for

the simple reasons that the lis has not been adjourned for that

purpose for that date. The Judge should instead direct the case to

be adjourned to a date for a particular purpose, even simply for the

appearance of parties. All previously served parties are legally

bound to appear on such adjourned dates of hearings. Fresh notice

to them is not required in law or in equity. A defendant who had

previously been set ex parte cannot expect to be served again; and

the same applies to an absent party. However, notice of the

restoration of the suit was ordered and was issued to Defendant

No.1 the service of which is at the fulcrum of the dispute now

raised in the Appeal. The Appellant/Defendant No.1/Judgment

Debtor No.1 contends that it was neither serviced by courier nor

by electronic mail.

8. Courts of law are always at pains to ensure that parties have

been duly served, as a one-sided hearing is anathema to law. In the

case before us, Defendant No.1/ Appellant had initially been duly

served. It had not only filed its Written Statement but had also

appeared before the Division Bench as well as the Hon‟ble

Supreme Court, by filing an appeal challenging the orders

directing it to deposit with the Registrar-General of this Court the

sum of US$76928.48 admittedly received by it from the other

Judgment Debtor. On the date when the Suit was erroneously

transferred to the District Court, the Appellant was duly

represented by counsel. He was, therefore, manifestly playing hide

and seek in the litigation. He would not, therefore, be entitled to

the stringent tests of service that would apply at the time of the

initial service of the Summons. The service of notice of the

restoration of the suit has been effected on the Appellant No.1

through courier, that is, by a third party. The Report unequivocally

states that the notice was served on the "doorstep" of the

Appellant. There is no reason to disbelieve this Report. The Decree

Holder/Respondent has stated on Affidavit that notice/information

was served by E-mail. In response thereto, learned counsel for the

Appellant has placed before us a copy of a Message dated

23.4.2009 stating that Email [email protected], which is the

address at which the Plaintiff/Respondent had sent the E-mail "has

not been in use since DVH‟s moving of offices in 2001. DVH has

never received any documents or emails regarding this matter at

this, or any other, email account. I stated this in a sworn statement

which I submitted to the Court previously". This is indeed an

evasive stand and leads us to the conclusion that the Appellant had

once again received formal notice of the hearings in the Suit.

9. It will be relevant to reproduce Notification dated 21.4.1998

in the context of the provisions with which we are concerned, the

relevant portion of which reads as follows:-

I. The following shall be inserted as rule 1(A) in Order XVII of the Code of Civil Procedure, 1908:- Rule 1(A) On the occurrence of an unanticipated holiday or in the event of the Presiding Officer of a Court being absent owing to sudden illness or other unexpected cause, all cases fixed for the day in Question shall be deemed to have been automatically adjourned to next working day when the Presiding Officer is present and it shall be the duty of the parties or their counsel to attend Court on that day.

Explanation :-Nothing in this rule shall apply where another Presiding Officer has been assigned the work of the court for the said day.

10. So far as courts in Delhi are concerned, therefore, it is not

expected that notices must issue to the parties who are already

served, informing them of the next date of hearing. They must be

present on the date, to which proceedings stand adjourned for

„proper orders‟. On that date the Court shall postpone hearings for

a particular and specific purpose.

11. There is a practice in the District Courts to issue notice to

the unrepresented party in the event that the Judge/Presiding

Officer is absent on a particular date of hearing, ostensibly on the

ground that the Reader is not competent to pass any judicial

orders. With due respect to the learned Single Judge, we are

unable to concur with the decision in Gobardhan Ram Bisheshar

Ram -vs- Banarsi Ram, AIR 1957 Allahabad 805. We affirm the law

and the reasoning of the learned Single Judge in Venutai Motiram

Ghongde -vs- Sadashiv Parashramji Madghe, AIR 1975 Bombay 68.

So far as Hukam Chand -vs- Mani Shibrat Dass, AIR 1934 Lahore

984 and Hari Krishan -vs- Madan Lal Sharma, 32(1987) DLT 338

are concerned neither of the Judgments prescribe the issuance of a

notice to the absent party; both cases merely hold that the lis

cannot be dismissed in default unless the Judge/Presiding Officer

has fixed the case for any aspect of the hearing. We agree with the

Division Bench in Firoz Khan -vs- Bibi Hasina Khanna, AIR 1994

Patna 103 which has noted the ever-increasing span in which cases

are decided, and have held that applications under Order IX Rule

13 should be allowed with circumspection and rigour. In such

cases, it would not be in the interest of justice that an Affidavit of

the absent party ascribing reasons for non-appearance should form

the sole basis for setting aside the decrees. We would be loath to

give punctilious approach or attitude which inexorably would be at

the expense of justice.

12. No cogent and credible cause has been shown by the

Appellant/Defendant No.1 for us to conclude that he did not

receive the notice either through courier or through electronic

mail. We would rather hold that he was deliberately absent in

order to delay proceedings. Learned counsel for the Appellant has

contended that Defendant/Respondent No.2 who had not

"submitted to the jurisdiction of the Court" had informed the

Appellant that the suit had been adjourned to 10.12.2007. We find

this version to be incredulous and contradictory. Both the

Defendants were watching the proceedings. No sufficient cause

has been shown for setting aside the ex parte judgment and decree

under Order IX Rule 13. As has been provided in that very

provision, since the Appellant has undoubtedly and

uncontrovertedly been served with the summons at the

commencement of the hearings in the suit, we are not called upon

to minutely survey the subsequent service of notice, which was

necessitated because the Appellant had chosen to stay away from

the hearings despite specific knowledge of the pendency of the

suit.

13. In this analysis, the Appeal as well as the application is

dismissed. We are not inclined to impose costs for the reason that

learned counsel for the Appellant had submitted that the deposited

sum of US$76928.48 be released to the Decree Holder on his

furnishing security to the satisfaction of the Court.

                                             ( VIKRAMAJIT SEN )
                                                   JUDGE



May 13, 2009                                 ( RAJIV SHAKDHER )
tp                                                 JUDGE