Syncom Formulations vs Sas Pharmaceuticals
2010 Latest Caselaw 3407 Del

21.
*     IN THE HIGH COURT OF DELHI AT NEW DELHI

                                       Date of Judgment 21 July, 2010
+     RFA 190/2009

SYNCOM FORMULATIONS                                ..... Appellant
             Through :       Mr. Sachin Gupta and Mr. Shashi P. Ojha,
                             Advs.

                  versus

SAS PHARAMECUTICALS                                   ..... Respondent

              Through :      Mr. Rajeev Kumar, Adv.

      CORAM:
      HON'BLE MR. JUSTICE G.S.SISTANI

      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
CM NO.81496/2009.

1. This is an application filed by the appellant under Section 5 of the

Limitation Act seeking condonation of delay of 806 days in filing the

present appeal.

2. Learned counsel for the appellant submits that the judgment and

decree was passed on 24.11.2006, however, the decree was drawn up

only on 25.5.2007. Counsel further submits that delay in filing the

appeal was caused on account of the fact that after passing of the

judgment and decree the appellant sought advice from various

counsels in Indore and Delhi about the merit and the grounds of the

appeal. The appellant thereafter approached the present counsel for

preparing appeal in the month of March, 2007.

3. It is further contended by counsel for the appellant that the case of the

appellant was being handled by the present law firm, which has senior

associate lawyers, who interact and receive instructions independently

from the clients and one such counsel was interacting with the present

appellant. The said counsel had prepared the first draft of the appeal in

the month of April, 2004, which was sent to the appellant for their

approval. The associate lawyer, who was handling the matter, in his

email dated 31.7.2007 had written to the appellant that the appeal is

being filed and, thus, the appellant was under the impression that

appeal had been filed, admitted and the same would come up for

hearing in its normal course.

4. Learned counsel for the appellant submits that the counsel who had

drafted the appeal left the services of the law firm, without giving

status report and without handing over the matters, which were being

handled by him and, thus, the filing of appeal escaped the attention

and was not filed within the period of limitation. Counsel further

submits that in April, 2009, when the appellant received execution

papers, the appellant contacted the law firm to find out the present

status of the appeal and it was learnt that the appeal had never been

filed. Counsel also submits that non-filing of the appeal within the

period of limitation was on account of inadvertence and it was neither

intentional nor deliberate and in case delay is not condoned, it would

result in a meritorious matter being thrown out at the very threshold

and cause of justice would be defeated.

5. Learned counsel for the appellant relies upon Ram Nath Sao vs.

Gobardhan Sao, reported at (2002) 3 SCC 195, in support of the

aforesaid plea which has been raised. Counsel for the appellant

submits that in the case of Ram Nath Sao (supra), the Apex Court

while considering various judgments of the Supreme Court had

condoned the delay in a partition suit, which has been decreed by the

trial court and thereafter four appellants had died during the pendency

of the first appeal before the High Court. The court had taken into

consideration that the appellants were rustic villagers and illiterate.

6. Learned counsel for the appellant submits that a liberal view should be

taken in this matter and delay should be condoned.

7. The present application has been vehemently opposed by counsel for

the respondent on the ground that the present application is extremely

casual in nature, devoid of material particulars and the appellant has

suppressed the fact that the appellant company had knowledge of the

judgment as an application under Order 39 Rule 2(A) CPC was filed

during the course of the suit and the same was pending even after

passing of the judgment. Counsel further submits that show cause

notices were issued to the Director of the appellant company on

24.11.2006 and 12.12.2006. The appellant was well aware of the

passing of the judgment and decree. Counsel also submits that perusal

of the appeal itself would show that the appeal was prepared on

4.4.2009 when the affidavit was duly attested, however, the appeal

was filed after 51 days on 26.5.2009. Counsel for the appellant has,

however, submitted that although the appeal was ready but the same could not have been filed as they were awaiting the cartons which were

not available.

8. It is contended by counsel for the respondent that in the application it

is nowhere stated that as to when the counsel had left the services of

the law firm and even otherwise the story is concocted and not reliable.

It is further contended that the appellant has failed to show sufficient

cause for condoning the delay.

9. Learned counsel for the respondent has placed reliance in the case of

Love Kumar Sethi Vs. M/s Deluxe Stores & Ors., reported at 145

(2007) DLT 275 (DB), wherein the delay of 146 days were not

condoned as the appellant had failed to provide the necessary

documents in support of the grounds for delay. The Division Bench has

held that the appellant has not satisfied the Court regarding there

being sufficient cause as the facts must inspire confidence. Counsel

further relies in the case of Ramey vs. M.C.D., reported at 134 (2006)

DLT 106 (DB), wherein delay was not condoned and it was held as

under:

4. Learned Counsel for the appellant has drawn our attention to two judgments of the Supreme Court, namely, Collector, Land Acquisition, Anantnag and Anr. v. Mst. Kastiji and Ors., reported as AIR 1987 SC 1353 and Balakrishnan v. M. Krishnamoorthy reported as VII (1998) SLT 334 = IV (1998) CLT 63 (SC) = 1998 (7) SCC 123 wherein it has been held that the court should adopt a liberal approach while disposing of applications for condensation of delay and that the word "sufficient cause" under Section 5 of the Act should receive a liberal construction so as to advance the cause of substantial justice.

5. We have perused the aforementioned judgments. There is no doubt that it is settled law that as against a technical and pedantic approach of throwing out a party on grounds of delay and laches, ends of justice are better met by rendering a decision on merits.

6. At the same time, we would also like to refer to a judgment of the Supreme Court in the case of Salil Dutta v. T.M. and M.C. Private Ltd. reported as JT 1993 (4) SC 528, wherein, while distinguishing the decision in Rafiq and Anr. v. Munshilal and Anr. reported as AIR 1981 SC 1400, it was observed as below:

The advocate is the agent of the party. His acts and statements, made within the limits of authority given to him, are the acts and statements of the principal i.e. the party who engaged him. It is true that in certain situations, the Court may, in the interest of justice, set aside a dismissal order or an ex- parte decree notwithstanding the negligence and/or misdemeanour of the advocate where it finds that the client was an innocent litigant but there is no such absolute rule that a party can disown its advocate at any time and seek relief. No such absolute immunity can be recognised. Such an absolute rule would make the working of the system extremely difficult. The observations made in Rafiq must be understood in the facts and circumstances of that case and cannot be understood as an absolute proposition.

7. In the light of the above and in the facts and circumstances of the present case, we are not persuaded to exercise our power of condensation of delay in favor of the appellant. We are not inclined to condone the delay of 1203 days in filing the present appeal as the appellant has failed to furnish any satisfactory Explanation in his application warranting condensation of delay. On the contrary, his application does not inspire any confidence. Admittedly, no complaint has been filed against the Advocate who was allegedly not diligent in pursuing the litigation on behalf of the appellant. Putting the entire blame upon the Advocate and trying to portray as if the appellant was illiterate and poor and hence totally unaware of the nature and significance of the pending proceedings, is quite unacceptable, particularly in view of the fact that the appellant has entered into a contract worth Rs. 20 lacs with the MCD and is, therefore, not only business savvy and worldly wise, but quite capable of taking care of his commercial interests. He is not a rustic ignorant villager hailing from the backwaters who has no knowledge of the legal proceedings and the court procedures.

10. I have heard counsel for the parties, who have taken me through the

application and reply thereto. The basic facts are not in dispute that

the judgment and decree was passed on 24.11.2006. Present appeal

has been filed on 26.5.2009 after a delay of 806 days.

11. In the case of P.K. Ramachandran Vs. State of Kerala & Anr.

(1997) 7 SCC 556, the Supreme Court has held that an essential pre-

requisite of exercising discretion to condone the delay is that the Court

must record its satisfaction that the explanation for delay was either

reasonable or satisfactory.

12. Reading of the application for condonation of delay would show that

after passing of the judgment and decree the appellant, which is a

limited company, had sought the advice from various counsels in

Indore as well as Delhi from 24.11.2006 uptill March, 2007. Thereafter

the present counsel was engaged to file an appeal. It has been strongly

urged before this Court that the appellant was mislead by the email

dated 31.7.2007 sent by the associate lawyer wherein it was stated

that appeal is being filed. It has been submitted that the email created

an impression in the mind of the appellant that no further action was to

be taken by them. I find no force in this submission of counsel for the

appellant in view of the fact that the appellant is a limited company

having the benefit of a trained legal department. It is not

understandable, how the appeal would have been filed without the

court fee, signatures and affidavit of the appellant. There is no

plausible or reasonable explanation as to why the appellant was not

vigilant and why the appellant did not pursue the matter with his

counsel rrom July, 2007, till April, 2009. As per the application after the

impugned judgment and decree was passed on 24.11.2006 the

appellant spent time in seeking advice from various counsels in Indore

and Delhi about the merit and the grounds of the appeal and it is only in the month of March, 2007 that the appellant approached the counsel

for preparing the appeal. The period of limitation expired in February,

2007, thus as per the own showing of the appellant they approached

their counsel after the expiry of period of limitation. The reading of the

application would show the callous and negligent attitude of the

appellant, which would disentitle the appellant from seeking

discretionary relief of condonation of delay.

13. The judgment sought to be relied upon by counsel for the appellant are

not applicable to the facts of this case, as the case of Ram Nath Sao

(supra) was decided taking into consideration that the appellants were

rustic villagers and illiterate while in this case the position is entirely

different.

14. While dealing with an application for condonation of delay under

Section 5 of the Limitation Act, the Court must bear in mind two

important considerations. Firstly, the expiration of limitation for filing

an appeal gives rise to a legal right to a decree-holder to treat the

decree as binding between the parties and this right should not be

lightly disturbed. Second, if sufficient cause is shown for condonation of

delay, the delay should be condoned. It has been repeatedly held by

the Supreme Court of India that the words "sufficient cause" should

receive a liberal construction so as to advance substantial justice. In

the same breath, it has been held that the discretion should be

exercised. When there is no negligence or inaction nor want of bona

fides imputable to the appellant the Court must be satisfied that there

was due diligence on the part of the appellant.

15. The facts of this case are to be considered on the touchstone of the

broad principles which have been laid down by the Supreme Court of

India while considering the present application for condonation of

delay. The conduct of the appellant in the present case shows total

callousness and negligence. The appellant, which is a company, has

been absolutely negligent in pursuing its matter. The application itself

would show that almost four months' time was taken to seek advice.

Further I find the explanation unsatisfactory that the files were

misplaced from January to December, 2008. Even after the files were

traced in the month of January, the affidavit and the appeal were

signed on 4.5.2009 while the same was filed on 26.5.2009 after 51

days. Even, at this stage, the appellant did not seem to be in any hurry

to file the appeal. The explanation rendered that the appeal could not

be filed as the cartons were not available is also without any merit and

does not inspire confidence. In these circumstances the Court is unable

to satisfy itself that delay was caused due to sufficient reasons.

Accordingly the application is dismissed.

RFA No.190/2009 & CM No.8147/2009.

16. In view of the fact that delay has not been condoned, appeal and CM

No.8147/2009 stand dismissed.

G.S. SISTANI, J.

July 21, 2010 'msr'