M/S Jersey Developers (P) Limited vs Canara Bank

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2708 OF 2022

M/s Jersey Developers (P) Limited & Ors. …Appellants

Versus

Canara Bank …Respondent

JUDGMENT

M.R. SHAH, J.

1. Feeling aggrieved and dissatisfied with the impugned

judgment and order dated 23.04.2021 passed by the High

Court of Judicature at Madras in Civil Revision Petition

No.4427 of 2015 by which the High Court has dismissed the Signature Not Verified Digitally signed by R Natarajan said revision application preferred by the appellants herein Date: 2022.04.13 16:58:55 IST Reason:

in which the appellants challenged the order passed by the

1 learned Trial Court dismissing the petition to set aside the

ex­parte decree, the appellants herein – original defendants

have preferred the present appeal.

2. The appellant no.1 is the company who availed the

loan facility from the respondent – Bank and appellant nos.

2 and 3 are the Directors who are staying along with their

family in United States of America (USA) for last 40 years.

The respondent ­ Bank instituted suit being OS No.3749 of

2003 before the learned Trial Court for recovery of the

amount. The summons of the suit and the notices were sent

to the address at Chennai which remained closed as the

appellants herein original defendants are staying in USA.

The summons and the notices were returned ‘unclaimed’.

Therefore, the Court below ordered substituted service by

newspaper publication. Thereafter the suit proceeded ex­

parte and an ex­parte decree came to be passed vide

judgment and decree dated 12.02.2004. The Bank

2 subsequently approached the Debts Recovery Tribunal for

issuance of the recovery certificate. The DRT, Chennai

issued a notice dated 07.06.2013 in the name of the

appellants calling upon them to pay a sum of

Rs.47,21,320.53. The said notice was also sent to the

address at Chennai which property according to the

appellants was already sold in the year 2002. According to

the appellants when appellant no.2 visited India in the year

2014, he become aware of the recovery certificate on

29.03.2014 and the ex­parte decree. The appellants herein­

original defendants therefore filed the application before the

learned Trial Court to set aside the ex­parte judgment and

decree dated 12.02.2004. The said application came to be

dismissed by the learned Trial Court. The revision

application against the order passed by the learned Trial

Court dismissing the application to set aside the ex­parte

judgment and decree has also been dismissed by the High

Court by the impugned judgment and order.

3 2.1 At the time of hearing of the present appeal it was

stated at the Bar that pursuant to the order passed by the

High Court, the petitioners have already deposited 50% of

the decretal amount. This Court passed an order dated

26.11.2021 that on deposit of the balance 50% of the

decretal amount with the Registry of this Court, notice shall

be issued. It is reported that by now the petitioners have

deposited the entire decretal amount (50% with the High

Court and 50% with the Registry of this Court).

3. Having heard learned counsel for the respective parties

and considering the fact that summons/notices issued by

the learned Trial Court were returned ‘unclaimed’ as the

same were sent at the address at Chennai and the house

was closed as the appellants herein original defendants were

staying in USA and thereafter the said house was sold and

so as to give one additional opportunity to the defendants to

defend the suit and as by now entire decretal amount is

4 deposited by the appellants to show their bonafides and

therefore the amount alleged to have been due and payable

to the Bank is secured, we are of the opinion that if the

appellants are given one additional opportunity to defend

the suit it will be in the fitness of things and meet the ends

of justice.

4. In view of the above and for the reasons stated above,

the present appeal succeeds. The impugned judgment and

order passed by the High Court as well as the order passed

by the learned Trial Court dated 17.03.2015 passed in I.A.

No.6778 of 2014 in OS No.3749 of 2003 dismissing the

application to set aside the ex­parte decree are hereby

quashed and set aside. The ex­parte judgment and decree

passed by the learned Trial Court in OS No.3749 of 2003 is

hereby quashed and set aside and the original suit is

ordered to be restored on the file of the learned Trial Court,

5 which shall be decided and disposed of by the learned Trial

Court in accordance with law and on its own merits.

4.1 Now appellants – original defendants to appear before

the learned Trial Court either in person or through their

Advocate(s) on 10th May, 2022 and they shall file their

written statements within a period of four weeks from the

first appearance before the learned Trial Court.

4.2 Now so far as the amount already deposited by the

appellants herein (50% of the amount pursuant to the order

passed by the High Court and the balance 50% of the

decretal amount pursuant to the order passed by this Court)

is concerned, it will be open for the respondent – Bank

original plaintiff to withdraw the same and keep it in an

interest bearing fixed deposit which shall be dealt with

subject to the ultimate outcome of the suit. In case the

plaintiff succeeds in the suit and the decree is passed the

said amount shall be appropriated towards the decree and if

6 the suit is dismissed the same shall be repaid to the

defendants subject to the further order to be passed by the

Appellate Court. The Bank shall retain the amount as

ordered hereinabove without prejudice to the rights and

contentions of the respective parties in the suit.

5. Present appeal is accordingly allowed to the aforesaid

extent. However, there shall be no order as to costs.

..…………………………….J. [M.R. SHAH]

………………………………J. [B.V. NAGARATHNA] NEW DELHI;

APRIL 13, 2022

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