Madras High Court
Ucal Fuel Systems vs Kintetsu Work Express (India) ... on 20 October, 2022
C.R.P.No.34 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 20.10.2022
CORAM:
THE HONOURABLE Mr. JUSTICE S.SOUNTHAR
C.R.P.No.34 of 2022
and
C.M.P.No.215 of 2022
UCAL Fuel Systems,
represented by its Chief Financial Officer,
Having its registered office at Raheja towers,
Delta Wing, Unit 705 177,
Anna Salai, Chennai- 600 002. .. Petitioner
Vs.
Kintetsu Work Express (India) Pvt. Ltd.,
Having its registered office at Brigade Magnum,
B-101, 1st Floor, International Airport Road,
Amurthahalli, Kodigehalli Gate, Hebbal,
Bangalore, Karnataka- 560092
and branch offices at RR Tower III, 6th Floor,
G1 & G2, TVK Industrial Estate, Guindy,
Chennai-600 032 and represented by its
authorised signatory, Mr.Srikanth Banu .. Respondent
PRAYER: Civil Revision Petition filed under Article 227 of Constitution
of India, pleased to pass an order setting aside the fair and decreetal order
dated 02.12.2019 in I.A.No.2 if 2019 in O.S.No.4405 of 2019, on the file
of the Court of learned XVI Additional City Civil Court, Chennai and
consequently set aside the ex-parte decree dated 26.09.2019 in
O.S.No.4405 of 2019.
1/20
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C.R.P.No.34 of 2022
For Petitioner : Mr.R.Murari, Senior Counsel
for M/s.Preeti Mohan
For Respondent :M/s.K.F.Manavalan
ORDER
This Civil Revision Petition is filed challenging the order passed by
the Court below dismissing the petition filed by the Civil Revision
Petitioner under Order 37 Rule 4 of C.P.C seeking to set aside exparte
decree passed against him on 26.09.2019 in a summary suit and also
seeking leave to defend the suit.
2. The respondent herein filed a summary suit under Order 37 of
C.P.C., seeking recovery of Rs.76,42,234.15/- together with interest at
the rate of 18% p.a., on the said principal sum. According to the
respondent/plaintiff it is a reputed freight forwarding logistics and supply
chain management service provider in India and around the world. The
petitioner/defendant is carrying on business, inter alia, offering fuel
management systems as well as manufacture of pumps, emission control
parts and various components etc., for the automotive sector. It was
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averred in the plaint of the respondent that it agreed to deliver the
petitioner's products to a “bonded warehouse”in El Paso, USA, to enable
petitioner's customers (consignee) to collect the products from the bonded
warehouse. As per the agreement, the consignment of the petitioner's
products has to be shipped from Chennai Port to a bonded warehouse
situated in a free trade zone in El Paso, U.S.A., from where the consignee
namely, the petitioner's customers in U.S.A would collect the
consignment. It was also agreed that all the charges including charges for
use of bonded warehouse and handling charges for storage of petitioner's
products quoted in U.S dollars have to be paid by the petitioners in rupee
equivalent to the respondent in India. It was also agreed as per the
agreement the products of the petitioner were shipped to and stored in
bonded warehouse at El Paso, U.S.A. However, the petitioners products
were not cleared from bonded warehouse by petitioner's customers
(consignees). Hence, the consignment had been retained in bonded
warehouse for some more time until the same was cleared by petitioner
by making arrangement to bring the same to Chennai from U.S.A. The
respondent averred in his plaint that from 08.08.2014 to 19.03.2018 as
many as 32 invoices raised by the respondent remained unpaid for the
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C.R.P.No.34 of 2022
services rendered by him under the agreement. The present summary suit
was laid by respondent for recovery of the said amount. After service of
summons in the suit, the petitioner failed to appear in response to the
summons and hence it was set exparte on 07.08.2019. Subsequently,
exparte decree was passed on 26.09.2019. Thereafter, the petitioner filed
I.A.No.2 of 2019 to set aside the exparte decree and also seeking leave
of the Court to defend the suit on 15.10.2019. In support of the said
petition petitioner had filed an affidavit wherein it was mentioned that
after service of summons the suit came up for hearing for the first time on
07.08.2019. The counsel for the petitioner was unable to appear on
07.08.2019, as she misplaced the vakalat executed in her favour for
appearance. Further it was stated that as the advocate who was engaged
was suffering from some kind of illness, fresh vakalat could not be
executed in her favour immediately. It was further averred on 12.09.2019
counsel appeared on behalf of the petitioner and made a request to the
Court to adjourn the matter for a short time to enable the petitioner to file
a petition to set aside exparte order passed against it on 07.08.2019. It
was asserted that in pursuance of the request made by the counsel, the
Court below pleased to adjourn the matter to 04.10.2019 under the
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caption exparte evidence. It was further averred that the counsel for the
petitioner appeared before the Court on 04.10.2019 with appropriate
petition supported by affidavit to set aside the exparte order. But
strangely she found that the matter was not listed and on enquiry and
perusal of online status the counsel came to the know that the suit stood
posted on 26.09.2019 for recording exparte evidence and judgment was
pronounced by the Court on the same day. It was also asserted that the
above said facts were brought to the notice of the Court below on
04.10.2019 itself and subsequently present petition was filed on
15.10.2019.
3. The said petition was resisted by the respondent by filing a
counter wherein it was mentioned that revision petitioner had not made
out any special circumstances to set aside the exparte decree passed
against it. It was averred that though summons were served on petitioner,
it failed to enter appearance within 10 days and issue notice of
appearance to the respondent as contemplated under Order 37 Rule 1 and
3 of C.P.C. It was also averred that the petitioner on receipt of summons
could have requested the respondent for supply of plaint documents had it
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C.R.P.No.34 of 2022
not been served on it at the time of service of summons.
4. The Court below on consideration of affidavit and counter
affidavit and rival submissions of the parties came to the conclusion that
that petitioner herein has not made out any special circumstances for his
non appearance and refused to set aside the exparte decree and dismissed
the petition. Aggrieved by the same the petitioner has come up by way of
this revision.
5. The learned senior counsel for the petitioner raised the following
points:
1. At the time of service of summons on the petitioner annexures to
the plaint namely plaint documents were not served on the petitioner and
hence there is no substantial compliance of Order 37 Rule 3 of C.P.C.
2. Summary suit can be filed only in respect of a debt or liquidated
money claim and in the present case it was filed on the strength of
invoices which are not debt or liquidated money claim.
3. According to the petitioner the suit claim based on 32 invoices
from 08.08.2014 to 19.03.2018 is partially time bared on the face of it
i.e., invoices up to 28.04.2016 are time bared.
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4. The learned senior counsel for the petitioner further submitted
that the transaction alleged in the plaint cannot be treated as open, mutual
and running account.
6. Elaborating above said points the learned senior counsel for the
petitioner submitted that in the impugned order there is no discussion as
to whether the plaint annexures were served on the petitioner are not. The
learned senior counsel further stressed that circumstances pleaded by him
for petitioner's failure to appear was not at all considered by Court below.
7. Per contra the learned counsel for the respondent raised the
following points:
1. Against an exparte decree an appeal will lie under Section 96(2)
of C.P.C and hence the present petition to set aside the exparte order and
grant leave to defend the suit is not maintainable.
2. The petitioner failed to mention the date on which the suit
summons were served on him.
3. The petitioner has not explained why he failed to issue notice of
appearance as required by Order 37 Rule 3(3) of C.P.C.
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8. The learned counsel for the respondent relied on the following
judgments in support of his contentions.
1.AIR 1984 SCC 38 ( Mohd. Yunus vs. Mohd. Mustaqim and
others)- for the proposition that the supervisory jurisdiction of the High
Court under article 227 of the Constitution of India is limited to see
whether the inferior Court or Tribunal function within the limits of it
authority and not to correct any error apparent on the face of record much
less on error of law.
2. AIR (2003) 5 SCC 315, ( Rajni Kumar vs. Suresh Kumar
Malhotra and Another)-wherein the expression special circumstances
mentioned in order 37 Rule 4 was explained as a circumstances so
unusual or extraordinary to justify putting a clock back by setting aside
the decree to grant further relief in regard to post decree matters.
3. AIR 1989 Raj 132, (Mohal Lal vs. Om Prakash) for the
proposition the expression special circumstances employed under Order
37 Rule 4 of C.P.C is not synonymous with the expression sufficient
ground used in Order 9 Rule 13 of C.P.C. Therefore according to the
learned counsel mere existence of sufficient ground is not sufficient to set
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aside the exparte decree and grant leave unless petitioner satisfy the Court
with regard to the existence of something more namely special
circumstances explaining his non appearance.
9. In reply to the contention of the learned counsel for respondent,
the learned senior counsel for the petitioner relied on the following
judgments.
1. 1948 (6) Delhi reported judgments 178, (Punjab & Sind Bank
vs. Ramji Das Khanna & Anr.), for the proposition that service of
summons shall be along with plaint copy and its annexures.
2. 2007 (93) DRJ 831, Goyal MG Gases Ltd vs. Premium
International Finance Ltd and Ors- wherein it was held that in a
summary suit under Order 37 it is mandatory to serve the copy of
plaint along with its annexures.
3. 2018 SCC Online MAD 3302 (Shankunthala Bansal and Ors. vs.
Puspalatha Gadia and Ors.- for the proposition that against the
order passed under Order 37 Rule 4 of C.P.C revision is
maintainable.
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C.R.P.No.34 of 2022
10. Heard the arguments of the learned senior counsel for the
petitioner and the learned counsel for the respondent and perused the
typed set of papers and original records received from the Court below.
11. In order to set aside the exparte decree passed in a summary
suit and grant leave to defend the suit, the Court has to satisfy with
regard to the existence of special circumstances, which prevented the
defendant from applying from leave to defend and also with regard to the
existence of facts which could entitle to him to defend the suit. Perusal of
the impugned order would suggest the Court below dismissed the petition
mainly on the ground that the revision petitioner failed to prove the
existence of special circumstances which prevented him from appearing
before the Court and apply for leave to defend. As far as the existence of
other circumstances which would entitle the revision petitioner to defend
the suit are concerned, the Court below did not consider the same as it
found, in the first instance, petitioner failed to prove the existence of
special circumstances.
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12. The expression special circumstances employed under Order
37 Rule 4 of C.P.C was very well explained by the Hon'ble Apex Court in
a judgment reported in (2003) 5 SCC 315, (Rajini Kumar Vs. Suresh
Kumar Malhotra and another)
“7. To appreciate the contentions of the parties it would
be useful to refer to Rule 4 of Order 37 C.P.C. which is in
the following terms :
"Order XXXVII -Summary Procedure
(1) to (3) ***
(4) Power to set aside decree - After decree the
Court may, under special circumstances, set aside the
decree, and if necessary stay or set aside execution, and
may give leave to the defendant to appear to the summons
and to defend the suit, if it seems reasonable to the Court
so to do, and on such terms as the Court thinks fit."
8. A careful reading of Rule 4 shows that it
empowers, under special circumstances, the court which
passed an ex parte decree under Order 37 to set aside the
decree and grant one or both of the following reliefs, if it
seems reasonable to the court so to do and on such terms
as the court thinks fit :
(i) to stay or set aside execution and
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(ii) to give leave to the defendant (a) to appear to
the summons and (b) to defend the suit.
9. The expression 'special circumstances' is not
defined in the C.P.C. nor is it capable of any precise
definition by the court because problems of human beings
are so varied and complex. In its ordinary dictionary
meaning it connotes something exceptional in character,
extra-ordinary, significant, uncommon. It is an antonym of
common, ordinary and general. It is neither practicable
nor advisable to enumerate such circumstances. Non-
service of summons will undoubtedly be a special
circumstance. In an application under Order 37, Rule 4,
the court has to determine the question, on the facts of
each case, as to whether circumstances pleaded are so
unusual or extra ordinary as to justify putting the clock
back by setting aside the decree; to grant further relief in
regard to post-decree matters, namely, staying or setting
aside the execution and also in regard to pre decree
matters viz., to give leave to the defendant to appear to
the summons and to defend the suit.”(emphasis supplied)
13. In the light of the law laid down by the Hon'ble Apex Court in
the above said decision we have to examine the case on hand. In the
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present case revision petitioner pleaded that in response to the summons
received from the Court it engaged an Advocate, but the vakalat executed
by the petitioner was misplaced by the said Advocate and she was also
not well at the relevant point of time and consequently she could not
appear before the Court on the date of hearing. It was also mentioned that
on a subsequent date of hearing Advocate appeared before the Court and
took time for filing petition to set aside exparte order and on such request
matter was adjourned to 04.10.2019. But strangely the matter was taken
up for hearing on 26.09.2019 and exparte decree order was passed on
that day. The Court below rejected the contention mainly on the ground
that an Advocate to whom the vakalat was given by the petitioner did not
file any affidavit in support of such contention. However, before this
Court an affidavit was filed by the learned counsel on record for the
revision petitioner namely Preethi Mohan dated 19.09.2022 wherein it
was averred as follows:
“3. I state that when the captioned petition was
taken up for final arguments on 09.09.2022, a question
arose as to whether an Affidavit had been filed by the
counsel for the petitioner in the proceedings before the
Court of Hon'ble XVI Additional Judge, City Civil Court in
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O.S.No.4405 of 2019, affirming the fact of the
misplacement of the Vakalat, resulting in no appearance
for the defendant therein (Petitioner herein on 07.08.2019,
when the suit came up for hearing for the first time. It is in
furtherance of the same, and the argument advanced on
behalf of the respondent in this petition, that I am filing the
present affidavit.
4. I state that the O.S.No.4405 of 2019 came up for
hearing for the first time on 07.08.2019. I further state that
the petitioner herein , just before such date, had given the
vakalat in my favour, which was inadvertently misplaced in
my office. I was also at the relevant point in time not
attending office due to my being unwell in the first and
second week of August 2019, and consequently owing to
my absence coupled with the fact of the vakalat having
been misplaced, the case was by oversight not attended to
on the date on which it was first called i.e. 07.08.2019. I
was also not available and hence not in a position to have
fresh a vakalat executed in my favour from the petitioner
and have the same produced before the lower Court on
07.08.2019. Owing to the said reason, the petitioner was
set ex parte and the matter was adjourned to 11.09.2019. I
state that the non-appearance and the misplacing of the
vakalat were entirely on account of an oversight at my end,
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and not in any manner attributable to the petitioner
herein.”
14. Misplacement of vakalat by an Advocate and her non
appearance before the Court on behalf of the client on the date of hearing
owing to misplacement of vakalat and illness can be certainly treated as
special circumstances under Order 37 Rule 4 of C.P.C. When a client
gives vakalat to an Advocate to represent him in the Court of law, under
normal circumstances Advocate will file the vakalat and appear before the
Court. The vakalat executed by client is the lifeline of an Advocate and no
Advocate would like to misplace the vakalat. If an Advocate files that she
misplaced the vakalat and owing to such misplacement and her illness
she could not appear on behalf of the client certainly there must be an
extraordinary situation under which the vakalat should have been
misplaced. In the light of the affidavit filed by the counsel on record
extracted above this Court is inclined to accept the contentions of the
petitioner that existence of special circumstances as contemplated under
Order 37 Rule 7 of C.P.C., had been established by the petitioner herein.
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15. The next question that arises for consideration is whether the
petitioner on the basis of the averment made in their affidavit has made
out the case to grant it leave to defend the suit. This question was not at
all considered by the Court below in the impugned order, as it dismissed
the petition on the 1st ground (non existence of special circumstances).
The petitioner submitted that the suit claim is based on the agreement
which came into existence by exchange of E.mails and it is not a suit for
recovery debt or liquidated money claim. It was also submitted that out of
32 invoices relied on by the respondent 16 were time barred. It was also
further submitted that averments found in the plaint are not sufficient to
presume existence of open, mutual and running account. The learned
senior counsel for the petitioner submitted that in a mutual, open and
running account one side payment is not sufficient. The mutual account
involves reciprocal demand and payment or promise to pay. In the light of
the averments contained in the affidavit of the petitioner in respect of the
above said points, I feel there are triable issues in this case which entitle
the petitioner to get leave to defend the suit. The question of limitation,
existence of open, mutual and running account and existence of
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agreement to avail a services of the respondent as claimed in the plaint
averments etc., have to be gone into in a full fledged trial. Therefore, this
Court comes to a definite conclusion that the petitioner is entitled to leave
to defend the suit. However, in the facts and circumstances of the case, it
would be appropriate to grant conditional leave to the revision petitioner
by directing him to deposit a sum of Rs.10 lakhs as a condition to defend
the suit.
16. In view of the discussions made above, the Civil Revision
Petition is allowed by setting aside fair and decreetal order passed in
I.A.No.2 of 2019, on condition, petitioner deposits a sum of Rs.10 lakhs
to the credit of O.S.No.4405 of 2019 on the file of the XVI Additional
City Civil Court, Chennai within a period of six weeks from the date of
receipt of copy of this order. On such payment by the petitioner, exparte
decree dated 26.09.2019 passed in O.S.No.4405 of 2019 stands set aside
and the petitioner is granted leave to defend the suit. The Court below is
directed to dispose of the suit in accordance with law. There shall be no
order as to costs. Consequently, connected miscellaneous petition is
closed.
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20.10.2022
Index: Yes/ No
Speaking Order / Non-Speaking Order
jai
C.R.P.No.34 of 2022
and
C.M.P.No.215 of 2022
S.SOUNTHAR, J.
After pronouncement of the order, the learned counsel for the
respondent made a request to this Court to fix a time limit for the disposal
of the suit. Considering the fact that the suit is for recovery of money and
the suit is of the year 2019, this Court is inclined to issue a direction to
dispose of the suit within a period of six months from the date of receipt
of copy of this order.
20.10.2022
jai
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C.R.P.No.34 of 2022
S.SOUNTHAR, J.
Jai
To
XVI Additional Judge,
City Civil Court,
Chennai
C.R.P.No.34 of 2022
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C.R.P.No.34 of 2022
20.10.2022
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