Shyam Kumar Gupta vs Shubham Jain

1 REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.765 OF 2023 (ARISING OUT OF SLP(C) NO. 2542 OF 2023)

SHYAM KUMAR GUPTA & ORS. APPELLANT(S)

VERSUS

SHUBHAM JAIN RESPONDENT(S)

JUDGMENT

DINESH MAHESHWARI, J.

Leave granted.

2. This appeal, by the legal representatives of deceased defendant

in the civil suit bearing No. 1 of 2015 for recovery of arrears of rent and

for ejectment, is directed against the order dated 21.09.2022 passed by

the High Court of Judicature at Allahabad, Lucknow Bench in the petition

bearing No. 3536 of 2022, whereby the High Court has declined to

interfere with the order dated 01.09.2022 passed by the Court of

Additional District and Sessions Judge (POCSO Act)-II, Raebareli,

rejecting an application under Order IX Rule 13 of Code of Civil

Procedure, 1908 (‘CPC’) for setting aside ex parte judgment and decree

dated 09.03.2016/16.03.2016.

3. Shorn of unnecessary details and briefly put, the relevant Signature Not Verified Digitally signed by Neetu Khajuria Date: 2023.02.08 background aspects of the matter are that the respondent herein, 18:57:46 IST Reason:

asserting his capacity as owner and proprietary right holder, filed the suit 2

aforesaid against the late father of present appellants in the Small

Causes Court, stating that the defendant was a tenant in the suit shop at

a monthly rent of Rs. 2,000/- per month and had failed to make payment

of rent from the month of February, 2015 to the month of May, 2015,

amounting to Rs. 8,000/- and 15% municipal tax despite notice.

4. It appears that in the said civil suit, the Trial Court held the service

of summons on the defendant sufficient and proceeded ex parte for want

of appearance on behalf of the defendant; and after taking evidence, on

09.03.2016, decreed the suit with costs, for recovery of arrears of rent in

the sum of Rs. 8,000/- and for eviction of the defendant from the suit shop

while also holding the plaintiff entitled to receive damages from the

defendant, for use and occupation of the suit shop, at the rate of

Rs. 2,000/- per month until delivery of actual vacant possession. The

operative part of the judgment dated 09.03.2016 reads as under: -

“The suit of the plaintiff is decreed ex-parte with cost against the defendant for recovery of the rent Rs. 8,000/- and for eviction of the shop in question and the defendant is ordered that he to hand over the vacant possession of the plaintiff’s shop which is at present situated in Municipality House No. 62/3, Ward No. 24, Malikmau Road, near Beliganj Phatak within the jurisdiction of the Municipality, Pargana, Tehsil and District Raebareli, the four boundaries of which are – North by: Malikmau Road, South by:

rest building of the plaintiff, East by: House of the plaintiff, West by: House of Hariom are situated, within two months. The plaintiff would be entitled to Receive Rs. 2,000/- per month as the compensation for use of the aforesaid shop during the suit and till handing over the actual vacant possession and occupation of the said shop after paying the Court Fee in the Execution Department.”

5. Later on, the defendant, predecessor of the appellants, moved an

application under Order IX Rule 13 CPC alongwith an application under 3 Section 5 of the Limitation Act, 1963 on 20.08.2016. He also moved an

application under Section 17 of the Provincial Small Cause Courts Act,

1887 (‘the Act of 1887’), alongwith a tender seeking permission to deposit

the decretal amount to the tune of Rs. 11,212/-, inclusive of the amount of

costs. An objection was taken by the plaintiff-respondent against the

application so moved by the defendant with the submissions, inter alia,

that under the decree in question, he was entitled not only to the said

arrears of rent and costs but also to damages at the rate of 2,000/- per

month until possession continued with the defendant; and necessary

deposit towards damages having not been made, the application for

setting aside ex parte decree was not maintainable. It is noticed that

during pendency of the application aforesaid, the defendant, father of the

appellants, expired on 26.09.2017; and an application was moved by the

present appellants on 12.03.2018, for their substitution as applicants in

place of the deceased applicant.

6. The Trial Court took note of the respective submissions of the

parties and upheld the objections of the plaintiff-respondent while

observing, inter alia, as under: -

“The applicant Mata Prasad by submitting an application 7g2 in the file of the present Miscellaneous Suit applied for depositing the decretal amount Rs. 8,000/- and cost of the suit Rs. 3212/- total amount Rs. 11,212/- on which an order was passed by the Court that the applicant can deposit the amount on which risk. Thus, it is clear that an amount of Rs. 11,212.00 has been deposited by the applicant Mata Prasad, whereas it is clear from perusal of the passed in the Small Cause Case no. 01/2015 and the decree dated 25-03-2016 passed in the pursuance of it, an order passed 4

has passed for paying the due rent from the month of February, 2016 to the month of May, 2016 (Total four months) @ Rs. 2,000/- per month which is total Rs. 8,000/- and payment 15% Municipality Tax to be paid @ 9%. Apart from it, it is also mentioned in the decree that until the defendant gives the possession and occupation of the shop in question by vacating it to the plaintiff, till then, compensation of use @ Rs. 2000/- per month be given to the plaintiff from the defendant and the cost of the case be given to the plaintiff from the defendant.

It is clear from integrated perusal of the aforesaid judgment and decree that the judgement and decree have not been complied by the applicant Mata Prasad. Neither the Municipality Tax nor the interest accrued on it and nor the compensation for use till the date of filing the application under Section 13 have been paid by him. Only the rent due since the month of February to the month of May, 2015 @ Rs. 2,000/- per month and the cost of the case Rs. 3212/- total amount Rs. 11,212/- has been deposited by him, the balance amount which was payable by the applicant Mata Prasad to the Opposite Party in compliance of the aforesaid decree and judgment, in that regard, neither any amount has been deposited by the applicant Mata Prasad and nor any permission has been sought from the court by filing any application with regard to submitting any undertaking about the compliance of it. Hence, it is clear that Section 17 of the Provincial Small Causes Court Act, 1887 which imposes compulsory liability on the applicant that the applicant after paying the total amount due under the ex-parte decree and judgment will file the application under Order 9 Rule 13 C.P.C. Word by word and complete compliance of the aforesaid legal provision has not been done by the applicant Mata Prasad and nor any undertaking/guarantee in this regard has been submitted in the Court by him that he is ready and willing to comply with the aforesaid Judgement and decree. In such situation, it is the opinion of the Court that the instant Miscellaneous Civil Suit due to not complying with Section 17 of the Provincial Small Causes Court Act, 1887 is liable to be dismissed and the preliminary objection application 36g2 filed by the Opposite Party is liable to be allowed.”

7. Being aggrieved by the aforesaid order dated 01.09.2022,

appellants approached the High Court by filing a petition under Article 227 5

of the Constitution of India, inter alia, with the submissions that the

defendant had not been served in the said civil suit, and the plaintiff-

respondent obtained the decree with concealment of facts. Further, it was

submitted that father of the appellants had moved the application

immediately after coming to know about ex parte decree, and complied

with the requirements of Section 17 of the Act of 1887. It was also

submitted that the Trial Court had failed to examine if the plaintiff-

respondent at all informed the defendant about his ownership after

purchasing the shop in question.

8. The High Court, however, agreed with the Trial Court about non-

compliance of the requirements of Section 17 of the Act of 1887 and, with

reference to the decision of this Court in the case of Kedarnath v. Mohan

Lal Kesarwari and Ors.: 2002 ALL CJ 145 [= (2002) 2 SCC 16],

proceeded to dismiss the petition essentially for want of requisite

compliance by the defendant, of depositing the amount due and payable

under the decree in question. The High Court, inter alia, observed and

held as under: -

“Having heard learned counsel for the parties and having perused the records, what emerges is that the SCC Suit filed by the respondent had been decided ex-parte vide order dated

09.03.2016 against which an application under Order IX Rule 13 of the CPC was filed by the petitioners. Admittedly, the petitioners did not comply with the provisions of Section 17 of the Act, 1887, which provides that the applicant, at the time of presenting the application, shall deposit in Court the amount due from him under the decree or in pursuance of the judgment, or give such security for the performance of the decree or compliance with the judgment 6

as the Court may, on a previous application made in this behalf, had directed.

Perusal of the impugned order dated 01.09.2022 would indicate that the court below has considered the violation of Section 17 of the Act, 1887 by specifically recording that the petitioners have failed to deposit the amount as was due in pursuance to the order dated 09.03.2016.

The Apex Court in the case of Kedar Nath(supra) has held the provisions of Section 17 of the Act, 1887 to be mandatory, as per the observations in the judgment, which, for the sake of convenience, are reproduced below:-

“In the case at hand, the application for setting aside ex parte decree was not accompanied by deposit in the court of the amount due and payable by the applicant under the decree. The applicant also did not move any application for dispensing with deposit and seeking leave of the court for furnishing such security for the performance of the decree as the court may have directed. The application for setting aside the decree was therefore incompetent. It could not have been entertained and allowed.” Accordingly, considering the law laid down by the Apex Court in the case of Kedar Nath(supra) and the specific finding given by the court below of the provisions of Section 17 of the Act, 1887 not having been complied with rather having been violated by the petitioners, this Court does not find any illegality or infirmity in the orders impugned. Accordingly, the petition is dismissed.”

9. Being aggrieved by the order so passed by the High Court, the

appellants have approached this Court. While considering the petition

leading to this appeal at the initial stage yesterday, i.e., on 01.02.2023

and after taking note of all the facts and circumstances of the case, when

this Court queried learned counsel for the appellants regarding the

amount towards rent/mesne profits until now due, it was submitted that

appellants were ready and willing to immediately deposit the amount so

due and, at request, the matter was adjourned for a day.

7 10. It has been pointed out that today, a sum of Rs.1,90,000/-

(Rupees One Lakh Ninety Thousand) has been deposited by the

appellants in the Trial Court, in compliance of this Court’s order dated

01.02.2023, which is said to be the amount further payable under the

decree in question, being that of rent/mesne profits @ Rs. 2,000/- per

month, from the month of June, 2015 to the month of April, 2023. A

photostat of the tender presented to the Trial Court, with endorsement of

deposit in the bank today, has also been placed before us.

11. Taking note of the steps so taken by the appellants and in the

totality of circumstances, while granting leave, we have heard learned

counsel for the parties finally at this stage itself.

12. Learned counsel for the appellants has essentially submitted that

the Trial Court and the High Court have taken too rigid a view of the

matter and have failed to consider that the amount directly due under the

decree in question, being a sum of Rs. 8,000/- towards arrears of rent and

another sum of Rs. 3,212/- towards costs had indeed been deposited by

the defendant; and in the given circumstances, the application for setting

aside ex parte decree could not have been dismissed only for want of

deposit of the amount towards further use and occupation of the suit

shop. It has also been submitted that it had not been a case of wilful

avoidance of the requirements of Section 17 of the Act of 1887 and in any

case, the appellants, having now deposited the amount towards

rent/mesne profits until the month of April, 2023, deserve an opportunity 8

to contest the suit on merits. Per contra, learned counsel for the

respondent has duly supported the orders impugned and has contended

that for want of specific compliance of the requirements of Section 17 of

the Act of 1887 at the time of filing of the application for setting aside ex

parte decree, the view as taken by the Trial Court, duly affirmed by the

High Court, cannot said to be unjustified.

13. Having given anxious consideration to the rival submissions and

having examined the record, we are clearly of the view that the impugned

orders cannot be approved and the appellants deserve an opportunity to

contest the suit on merits.

14. Section 17 of the Provincial Small Cause Courts Act, 1887, on

which reliance has been placed by the Trial Court and by the High Court

while declining the prayer for setting aside ex parte decree, reads as

under: -

“17. Application of the Code of Civil Procedure.—(1) The procedure prescribed in the Code of Civil Procedure, 1908 (5 of 1908), shall save in so far as is otherwise provided by that Code or by this Act, be the procedure followed in a Court of Small Causes, in all suits cognizable by it and in all proceedings arising out of such suits:

Provided that an applicant for an order to set aside a decree passed ex parte or for a review of judgment shall, at the time of presenting his application, either deposit in the Court the amount due from him under the decree or in pursuance of the judgment, or give such security for the performance of the decree or compliance with the judgment as the Court may, on a previous application made by him in this behalf, have directed. (2) Where a person has become liable as surety under the proviso to sub-section (1), the security may be realized in manner 9

provided by Section 145 of the Code of Civil Procedure, 1908 (5 of 1908).”

14.1. Rule 13 of Order IX of the Code of Civil Procedure, 1908 could

also be extracted for ready reference as under: -

“13. Setting aside decree ex parte against defendants.- In any case in which a decree is passed ex parte against a defendant, he may apply to the Court by which the decree was passed for an order to set it aside; and if he satisfies the Court that the summons was not duly served, or that he was prevented by any sufficient cause from appearing when the suit was called on for hearing, the Court shall make an order setting aside the decree as against him upon such terms as to costs, payment into Court or otherwise as it thinks fit, and shall appoint a day for proceeding with the suit:

Provided that where the decree is of such a nature that it cannot be set aside as against such defendant only it may be set aside as against all or any of the other defendants also:

Provided further that no Court shall set aside a decree passed ex parte merely on the ground that there has been an irregularity in the service of summons, if it is satisfied that the defendant had notice of the date of hearing and had sufficient time to appear and answer the plaintiffs claim.

Explanation. - Where there has been an appeal against a decree passed ex parte under this rule, and the appeal has been disposed of an any ground other than the ground that the appellant has withdrawn the appeal, no application shall lie under this rule for setting aside the ex parte decree.”

15. It could be reasonably noticed that in relation to the suit to which

the Act of 1887 applies, an applicant seeking an order to set aside the

decree passed ex parte is required to deposit the amount due under the

decree/judgment or has to furnish security for due performance of the

decree or compliance with the judgment. Even under Order IX Rule 13

CPC, while making an order for setting aside the decree passed ex parte,

the Court may put the defendant to terms as to costs, payment into Court

or otherwise. However, these requirements need to be visualized from a 10

practical standpoint and cannot be applied as if to penalize the defendant

for every mistake, even if the amount payable is not explicitly quantified in

the decree in question.

15.1. For the purpose of the case at hand, as regards the amount

payable, a sum of Rs. 8,000/- towards arrears of rent had been quantified

in the decree and another sum of Rs. 3,212/- towards costs could have

been taken as quantified. Of course, the plaintiff was further held entitled

to receive Rs. 2,000/- per month towards rent/mesne profits during the

suit and until getting the actual vacant possession of the suit shop after

payment of requisite court fees but, the Trial Court did not specifically

quantify the amount payable by the defendant even until the date of

decree. In the given circumstances, when the defendant, predecessor of

the appellants, immediately moved the Court after noticing the decree in

question and deposited the amount directly quantified thereunder i.e., the

sum of Rs. 8,000/- towards arrears of rent and Rs. 3,212/- towards costs,

totalling to Rs. 11,212/-, while seeking the order for setting aside ex parte

decree, it had not been a case where the defendant had ignored the

requirements of deposit altogether. Moreover, the decree in question had

not been merely a money decree but had been for eviction too. Looking to

the subject-matter of the suit and the overall circumstances, a practical

view was required to be taken and if all any further deposit or furnishing of

security was considered necessary, appropriate orders could have been

passed in that regard. Putting it differently, in terms of Section 17 of the 11

Act of 1887 read with Order IX Rule 13 CPC, the Court could have

extended the time for making deposit if so required, or could have put the

defendant to the terms of security for performance of the decree.

15.2. However, for what has been noticed and extracted hereinabove, it

is apparent that Trial Court and the High Court have viewed the

requirements of Section 17 of the Act of 1887 from such an exacting and

rather impractical standpoint that the bonafide attempt of the defendant to

seek a merit decision of the suit after due contest has been totally

ignored. In our view, in the present set of facts and circumstances, prayer

of the defendant to set aside ex parte decree could not have been denied

for want of further deposit in terms of the decree in question.

15.3. The High Court, while dismissing the petition filed by the

appellants and endorsing the views of the Trial Court, has proceeded to

rely upon the decision of this Court in the case of Kedarnath (supra), that

the provisions of Section 17 of the Act of 1887 are held to be mandatory.

In our view, reference to the said decision remains inapposite in the

present case. Even if the requirements of Section 17 of the Act of 1887

are held to be mandatory, the present one had not been a case where the

defendant had altogether ignored those requirements. In Kedarnath

(supra), in the very passage reproduced by the High Court, it was clearly

noticed that the applicant did not make any deposit and did not move any

application for dispensing with deposit or seeking leave of the Court for

furnishing security. In the backdrop of such facts, showing total non- 12

compliance of the requirements of Section 17 of the Act of 1887, this

Court held the application for setting aside the decree as incompetent. It

is difficult to apply the decision in Kedarnath (supra) to the facts of the

present case.

16. Apart from the above, where we find that the Trial Court and the

High Court had taken too technical and impractical a view of the matter,

there is another strong reason for which we are inclined to accept the

prayer for setting aside the decree passed ex parte in this case. As

noticed, in response to the queries of this Court, the appellants have

immediately taken bonafide steps and have deposited the amount which

may be relatable to rent/mesne profits until the month of April, 2023. For

this bonafide and prompt step (albeit taken after approaching this Court),

in our view, they do deserve an opportunity to contest the suit on merits,

particularly when the matter relates to a shop where the predecessor of

the appellants had been continuing as tenant and the plaintiff-respondent

is seeking the decree for eviction only on the ground of default in payment

of rent.

17. Accordingly and in view of the above, this appeal succeeds and is

allowed in the manner that while setting aside the impugned orders dated

01.09.2022 and 21.09.2022, the application filed by the appellants under

Order IX Rule 13 CPC is allowed and thereby, the ex parte judgment and

decree dated 09.03.2016/16.03.2016 are set aside. Consequently, the

said suit shall stand restored for being considered on its own merits. 13

18. For the purpose of proceedings in the suit, looking to the time that

has elapsed, it shall definitely be required of the Trial Court to assign the

same a reasonable priority and to proceed expeditiously, while curbing

against unnecessary delay. Further, in the interest of justice, it is also

considered appropriate and hence provided that it shall be required of the

appellants to submit their written statement(s) on or before 28.02.2023

and thereafter, the Trial Court shall proceed with expedition, as indicated

above.

19. As regards the amount deposited by the appellants, we leave it

open for the respondent-plaintiff to apply for its withdrawal, if so advised;

and if any such prayer is made by the plaintiff, the same may be given

due consideration by the Trial Court in accordance with law.

20. The parties through their respective counsel shall stand at notice

to appear before the Trial Court on 28.02.2023.

21. Pending applications also stand disposed of.

………………....................,J.

(DINESH MAHESHWARI)

..……………....................,J.

(BELA M. TRIVEDI)

NEW DELHI;

FEBRUARY 02, 2023.