M/S. S.S.Muchandi Engineers And ... vs M/S. South West Mining Limited
2022 Latest Caselaw 5629 Kant

                                 1


          IN THE HIGH COURT OF KARNATAKA
                  DHARWAD BENCH

       DATED THIS THE 29TH DAY OF MARCH, 2022

                          PRESENT
   THE HON'BLE MR.JUSTICE S. SUNIL DUTT YADAV
                                AND
     THE HON'BLE MRS.JUSTICE K.S. HEMALEKHA


                 COM.AP No.100008/2021

BETWEEN:


M/s.S.S.Muchandi Engineers & Contractors
A Partnership Firm having its registered office
at Anand Vijay Apartment, 1930, 'E' Ward,
13th Lane, Rajarampuri, Dist: Kolhhapur,
State: Maharashtra - 416 008.
Rep. by its Partner Sri. Shrijeet S. Muchandi
Age: 46 years, Occ: Business,
R/o Anand Vijay Apartment,
1930, 'E' Ward, 13th Lane,
Rajarampuri, Dist: Kolhhapur,
State : Maharashtra - 416 008.       ....   Defendant/Appellant

(By Sri. K.L.Patil, Advocate)


AND:

M/s. South West Mining Limited
A Company incorporated
under the Companies Act,1956
And having its registered office
near Talur Cross,P.O. Vidyanagar,
                               2


Ballari - 583 275.
Rep. by its Authorised Signatory   ...   Plaintiff/Respondent

(By Sri Prashant F Goudar, Advocate)


     THIS APPEAL IS FILED UNDER SECTION 13 (1A) OF
THE COMMERCIAL COURTS ACT, 2015 PRAYING TO SET
ASIDE THE JUDGMENT AND DECREE DATED 19.03.2021
PASSED BY THE LEANRED IV Addl. DISTRICT AND SESSIONS
JUDGE (COMMERCIAL COURT) AT BALLARI, IN COMMERCIAL
O.S.NO.3/2021 AND REMIT THE MATTER BACK TO THE TRIAL
COURT ETC.

     THIS APPEAL COMING ON FOR ORDERS THIS DAY,
S.SUNIL DUTT YADAV J., DELIVERED THE FOLLOWING:

                        JUDGMENT

The appellant who is the defendant before the trial

court has assailed the judgment and decree passed in

Commercial O.S.No.3/2021 dated 19.03.2021 whereby the

suit of the plaintiff came to be decreed in part with costs.

It was declared that the defendant was liable to pay a sum

of Rs.9,09,67,869/- along with interest at 18% per annum

from 31.03.2018 till the date of realization.

2. The parties are referred to by their ranks

before the trial court for the purpose of convenience.

3. The suit for recovery came to be decreed as

above stated. The admitted facts being that the defendant

was placed exparte in the proceedings before the trial

court.

4. The plaintiff is stated to be a Company

registered under the Companies Act and the defendant is a

Partnership Firm. The defendant is stated to have been

awarded contract by Mysore Minerals Limited (now

renamed as Karnataka State Minerals Corporation Limited)

for excavation of Iron Ore at Subbarayanahalli Iron Ore

Mines. The defendant vide work order dated 09.12.2014

awarded the sub-contract of deployment of Heavy Earth

Moving Machinery on hire basis for different periods of

time in favour of the plaintiff company. It is submitted

that disputes arose relating to the said contract and for the

present purpose, no other details regarding facts would be

of relevance as the only relief sought for in the appeal is to

set aside the exparte judgment and decree while affording

an opportunity to the defendant to appear before the trial

court and file their written statement and contest the suit.

5. It is not in dispute that summons sent to the

defendant through RPAD was duly served and as the

defendant has remained exparte without putting any

representation, the trial court after placing the defendant

exparte has decreed the suit.

6. The present appeal has been filed seeking for

an opportunity of re-opening of the proceedings and in the

appeal memorandum, it is submitted that reasons for the

defendant not having filed the written statement was as a

result of difficulties associated with Covid-19 Pandemic.

7. It is submitted that the defendant was carrying

on its business at Kolhapur and in light of Second Wave

Covid-19 Pandemic, there were several travel restrictions

placed by the State of Karnataka and State of Maharashtra

on Inter-District and Inter-State travel.

8. Reliance is placed on the judgment of the Apex

Court in the case of Prakash Corporates v. Dee Vee

Projects Limited reported in AIR 2022 SC 946 and it is

contended that in light of the observation made by the

Apex court, period of limitation to file the written

statement would also start from the expiry of the order

passed by the Apex Court in Suo Motu Writ Petition (C)

No.3/2020.

9. The learned counsel for respondent however

submits that the judgment of the Apex Court was a case

wherein defendants had put in appearance and had sought

extension of time to file the written statement and

accordingly, such facts if taken note of, the judgment of

the Apex Court could be distinguished.

10. Heard both sides.

11. The point for consideration is as follows:

Whether case is made out by the

appellant/defendants to set aside the exparte judgment

and decree in light of the inconvenience arising due

Covid-19 Pandemic which would be sufficient cause for

reopening the proceedings and to permit the defendant to

participate in the trial ?

12. It is not in dispute that the defendant having

been served with the notice has failed to put in

appearance. Accordingly, the trial court having placed the

defendant exparte has concluded the proceedings. What

also ought to be noticed is that the suit was instituted on

30.01.2021 and the date of evidence was fixed on

08.03.2021 and the judgment was passed on 19.03.2021.

13. It is the contention of the defendant that even

though the defendant was placed exparte, if the trial court

had deferred the proceedings till the time available under

law to file the written statement under Order VIII Rule 1

CPC, the defendant would have approached the court and

sought for reopening of the proceedings, but before expiry

of such period, the proceedings have culminated, depriving

the defendant from participating in the proceedings. The

difficulties relating to Covid-19 Pandemic are to be taken

judicial notice of. The submission relating to restrictions in

movement due to Second Wave of Covid-19 Pandemic

both in the States of Maharashtra and Karnataka are also

matters that could be taken judicial notice of.

14. Noticing that the appellant has not participated

in the proceedings, taking note of the judgment of the

Apex Court providing for extended period of limitation to

file the written statement, necessary orders could be

passed in exercise of judicial discretion.

15. The Apex Court in the case of Prakash

Corporates (supra) while considering the question of

extended time to file written statement has observed at

Para 20 to 20.3 as follows:

" 20. As regards the operation and effect of the orders passed by this Court in SMWP No. 3 of 2020, noticeable it is that even though in the initial order dated 23.03.2020, this Court provided that the period of limitation in all the proceedings, irrespective of that prescribed under general or special laws, whether condonable or not, shall stand extended w.e.f.

15.03.2020 but, while concluding the matter on 23.09.2021, this Court specifically provided for exclusion of the period from 15.03.2020 till 02.10.2021. A look at the scheme of the Limitation Act, 1963 makes it clear that while

extension of prescribed period in relation to an appeal or certain applications has been envisaged Under Section 5, the exclusion of time has been provided in the provisions like Sections 12 to 15 thereof. When a particular period is to be excluded in relation to any suit or proceeding, essentially the reason is that such a period is accepted by law to be the one not referable to any indolence on the part of the litigant, but being relatable to either the force of circumstances or other requirements of law (like that of mandatory two months' notice for a suit against the Government).

The excluded period, as a necessary consequence, results in enlargement of time, over and above the period prescribed.

20.1. Having regard to the purpose for which this Court had exercised the plenary powers Under Article 142 of the Constitution of India and issued necessary orders from time to time in SMWP No. 3 of 2020, we are clearly of the view that the period envisaged finally in the order dated 23.09.2021 is required to be excluded in computing the period of limitation even for filing the written statement and even in cases where the delay is otherwise not

condonable. It gets perforce reiterated that the orders in SMWP No. 3 of 2020 were of extraordinary measures in extraordinary circumstances and their operation cannot be curtailed with reference to the ordinary operation of law.

20.2. In other words, the orders passed by this Court on 23.03.2020, 06.05.2020, 10.07.2020, 27.04.2021 and 23.09.2021 in SMWP No. 3 of 2020 leave nothing to doubt that special and extraordinary measures were provided by this Court for advancing the cause of justice in the wake of challenges thrown by the pandemic; and their applicability cannot be denied in relation to the period prescribed for filing the written statement. It would be unrealistic and illogical to assume that while this Court has provided for exclusion of period for institution of the suit and therefore, a suit otherwise filed beyond limitation (if the limitation had expired between 15.03.2020 to 02.10.2021) could still be filed within 90 days from 03.10.2021 but the period for filing written statement, if expired during that period, has to operate against the Defendant.

20.3. Therefore, in view of the orders passed by this Court in SMWP No. 3 of 2020, we have no hesitation in holding that the time limit for filing the written statement by the Appellant in the subject suit did not come to an end on 06.05.2021."

16. It must be noticed that if the defendant had

put in appearance, he would have had time to file written

statement which would extend to an outer limit of

120 days from 28.02.2022 which would be a conclusion to

be arrived at. When the period for filing of written

statement would be extended by an outer limit of 120

days, the request of the defendant to enable him to

participate in the proceedings and giving shorter period of

time to file written statement appears to be a reasonable

request which would fall within the limits of law. In order

to assuage the apprehension of the plaintiff regarding

non-satisfaction of the decree, taking note of the

observation made in Para 3 of the impugned judgment to

the effect that "payment would be done within 8 working

days after the payment is done by the principal employer

to the plaintiff" as is averred in the plaint as well, it would

be appropriate to put the defendant on terms.

17. It could be stated that the cause for not having

participated in the proceedings are reasonable and just

and could be construed to be sufficient cause for non-

appearance. The explanation for non-participating in the

proceedings being bonafide, taking note of various

notifications relating to Covid-19 Pandemic and in specific

with respect to the travel restrictions, the explanation for

non-participating in the proceedings could be accepted on

condition that affidavit by way of undertaking to be filed

within five days of release of the order to the effect that

any payment made by the principal employer i.e.,

Karnataka State Minerals Corporation Ltd. to the defendant

would be kept aside separately till disposal of the suit and

such details of deposit to be filed before this court. Such

amount to be kept in deposit till the conclusion of

proceedings before the trial court which would be in the

nature of security. A nominal cost of Rs.5,000/- payable

to the Advocates Clerks Welfare Fund to be paid by the

appellant within a period of one week.

18. Accordingly, the judgment and decree passed

by the IV Addl. District and Sessions Judge (Commercial

Court), Ballari in Commercial O.S.No.3/2021 dated

19.03.2021 is set aside. The proceedings before the trial

court are re-opened. The defendant to put in appearance

before the trial court within a period of one week from the

date of release of this order and in terms of undertaking

made at the time of arguments, written statement to be

filed on or before 23.04.2022.

19. Needless to state that in light of reopening of the

proceedings, the defendant is entitled to participate in the

proceedings before the trial court as is permissible in law.

The details of deposit ordered to be filed before this court

is also to be furnished before the trial court. The appellant

is entitled for refund of court fee in terms of Section 64 of

the Karnataka Court Fees and Suits Valuation Act.

Accordingly, the appeals is disposed off.

Sd/-

JUDGE

Sd/-

JUDGE Np/-