Mahesh Kumar Joshi vs Madan Singh Negi

Page 1 Civil Appeal No. of 2015 @ SLP (C) No.11191 of 2013

ex-parte decree and to grant leave to appeal to defend the

summary suit.

4. The respondent-plaintiff filed suit under Order XXXVII of

the Code of Civil Procedure (for short “the Code”) on 4 th

November, 2009 seeking a decree for Rs.3 lacs with costs and

interest alleging that the appellant-defendant gave two

cheques for Rs.3 lacs towards purchase price of Plot No.71-A,

measuring 233 sq. yard situated in Ram Park Extension

Colony, being Khasra No.196(Main), village Loni, District

Ghaziabad, Uttar Pradesh which were dishonoured inspite of

plaintiff having executed the requisite documents and handed

over peaceful vacant possession of the plot in question.

Though the summons were duly served on the wife of the

appellant on 19th December, 2009, the appellant failed to

enter appearance within ten days on which the trial Court

passed the ex-parte decree on 24th February, 2010.

5. The appellant sought setting aside of the said decree by

filling the application dated 25th March, 2010 under Order

XXXVII Rule 4 of the Code. He submitted that the power of

attorney dated 10th October, 2004 in favour of the plaintiff by

Smt. Asha Negi, the alleged owner of the plot in question, did

Page 2 Civil Appeal No. of 2015 @ SLP (C) No.11191 of 2013

not specify the plot number and the appellant found no such

plot in existence in the records of the Ghaziabad Development

Authority. Instead of Plot No.71-A, the number of the plot was

71 which did not belong to Asha Negi but to someone else.

Thus, the appellant did not get possession of the plot and the

cheques in question could not be taken to be in discharge of

any liability. The transaction was without any lawful

consideration and was void.

6. The application was contested by the respondent and

the trial Court vide Order dated 12 th January, 2012 dismissed

the application which order has been affirmed by the High

Court.

7. Dealing with the objection of the appellant, the Courts

below held that the suit was for recovery on account of

dishonour of cheques and was not in respect of the

transaction of property. Presumption under Section 118 of the

Negotiable Instruments Act was available. The appellant had

failed to enter appearance without any justification in spite of

service, there was no ground to set aside the ex parte decree.

8. We have heard learned counsel for the parties.

Page 3 Civil Appeal No. of 2015 @ SLP (C) No.11191 of 2013

9. Learned counsel for the appellant categorically stated

that the appellant was not in possession of the plot in question

and no such plot existed. The plaintiff-respondent was at

liberty to take over the same to which the appellant had no

objection. He submitted that the transaction in question was

without any consideration. He also submitted that though the

wife of the appellant received the summons which were

handed over to the counsel, for want of ignorance, the

appearance could not be filed. Thus, even if the appellant is

not granted unconditional leave to defend, such leave could

be given subject to reasonable conditions. If leave to appeal

is not granted, there will be perpetuation of injustice to the

appellant by making him to suffer the decree in respect of a

transaction without any consideration.

10. Learned counsel for the respondent supported the

finding recorded by the courts below.

11. After due consideration, we are of the view that a

debatable issue does arise for consideration and it will be fair

and just to give the appellant an opportunity to contest the

suit subject to the appellant depositing the entire amount

claimed in the suit but without interest or costs, i.e. Rs.3 lacs.

Page 4 Civil Appeal No. of 2015 @ SLP (C) No.11191 of 2013

In pursuance of interim order dated 8 th March, 2013, the

appellant claims to have deposited 50% of the decretal

amount before the trial Court. On depositing the rest of the

amount to make up the deficit of Rs.3 lacs within six weeks

from today, the decree will stand set aside and the appellant

will be entitled to leave to defend. The deposit will abide by

further order of the trial Court.

12. We are conscious of the fact that setting aside of ex-

parte decree under Order XXXVII Rule 4 of the Code cannot be

allowed in routine and special circumstances are required to

be established. However, the expression “special

circumstances” has to be construed having regard to the

individual fact situations. The Court has to balance the

equities and while safeguarding the interest of the plaintiff,

appropriate conditions can be laid down if the defendant

makes out a debatable case which may prime facie show

injustice if the ex-parte decree was not set aside. As already

observed, in the present case, it will be in the interests of

justice that the ex-parte decree is set aside but the interest of

the plaintiff is safeguarded by the deposit of the amount in

Page 5 Civil Appeal No. of 2015 @ SLP (C) No.11191 of 2013

question by the defendant as a condition precedent for setting

aside the decree.

13. Accordingly, the appeal is allowed in the above terms. It

is made clear that we have not expressed any final opinion on

merits and the trial Court will be free to take decision in the

matter without being bound by the observations made in this

order which are only for deciding this appeal.

…………………………………J. (T.S. THAKUR)

………………………………………J. (ADARSH KUMAR GOEL)

NEW DELHI JANUARY 15, 2015

Page 6