International Airports Authority Of India vs M.L. Dalmia & Co. Ltd.

2. This is an appeal by special leave filed against the order of the High Court whereby the High Court refused to restore the appeal filed before it by the appellant, which was dismissed in default of appearance of the appellant and his counsel on 10.7.2001.

3. It appears that disputes and differences arising out of the contract entered into between the parties led to arbitration proceedings. An award was given which was made a rule of the court by a learned single judge of High Court. Feeling aggrieved by the decree so passed, the appellant preferred a letters patent appeal. On 19.12.1994, while issuing notice in the appeal, the High Court directed following interim order to be passed:

"Notice for 31.1.1995, subject to the condition that the appellant deposits in court, the rupees, equivalent to the dollar value on the date of termination of the contract. So far as the withdrawal of the money, so deposited is concerned, half will be permitted to be withdrawn without security and the other half on furnishing bank guarantee. This order is without prejudice to any contentions that may be raised by the respondent in the matter, after notice".

4. On 6.7.1999 and 18.7.2000, twice the appeal was dismissed in default of appearance, but allowed to be restored. On 19.12.2000, the date appointed for hearing, there was no appearance for the appellant. Again there was default of appearance on 10.7.2001 and on this day the division bench directed the appeal to be dismissed. Though restoration was applied for but taking the totality of the facts of the case, specially the conduct of the appellant suffering dismissal in default thrice, the High Court refused to show any indulgence to the appellant.

5. Having perused the contents of the application for restoration supported by affidavit, we find that the appellant did try to explain the absence on 10.7.2001 but the explanation so offered did not appeal as plausible to the High Court, specially in view of the earlier conduct of the appellant which weighed heavily with the High Court resulting in denial of indulgence being shown to the appellant.

Looking at the stakes involved and keeping in view the weighty consideration that so far as practicable, a litigant ought not to be denied a hearing on merits, we are inclined, in the facts and circumstances of this case, to allow the appellant one more opportunity of hearing in the appeal on merits by restoring the same on the file of the High Court, but subject to terms.

6. The appeal is allowed. The impugned order of the High Court is set aside and it is directed that the appellant shall be allowed an opportunity of hearing in appeal on merits, subject to the following conditions:

1) The appellant shall deposit the decretal amount as per the award, which is in dollars, by applying for the time being the conversion rate as applicable on the date of termination of the contract.

2) Before allowing hearing, the High Court shall satisfy itself that the awarded amount (including interest), giving adjustment for the deposit made in compliance with the order dated 19.12.1994, stands deposited.

3) It shall be in the discretion of the High Court, to permit or not to permit withdrawal of the amount during the pendency of appeal and to devise terms and conditions of withdrawal if permitted.

7. The compliance with the abovesaid order is limited to afford hearing to the appellant. The High Court, at the final hearing, would be free to determine to what extent and in what manner the award, the decree, and the direction to pay interest are to be upheld as also the conversion rate to be applied. The costs in this appeal shall be borne by the appellant.