SUPREME COURT OF INDIA
S.A. BOBDE, CJI., B.R. GAVAI, SURYA KANT, JJ.
Desh Raj – Appellant
Versus
Balkishan (D) through Proposed LR Ms. Rohini – Respondent
Civil Appeal No. 433 of 2020, Special Leave Petition (Civil) No. 6217 of 2019
Decided On : 20-01-2020
(a) Code of Civil Procedure, 1908 - Order VIII Rule 1 r/w section 16, Commercial Courts Act, 2015 - Section 16 amending the Code to the effect that all commercial disputes shall be governed by the amended provision - All non-commercial disputes shall continue to be governed by unamended Code - Mandatory nature of timeline prescribed for filing of written statement and the lack of discretion with Courts to condone any delay - Applicable only to commercial disputes - unamended Order VIII Rule 1, a directory provision, continues to govern non-commercial disputes - It does not do away with the inherent discretion of Courts to condone certain delays. (Para 12, 14)
(b) Code of Civil Procedure, 1908 - Order VIII Rule 1 - Instantly dispute not falling within Section 2(c) (vii), Commercial Courts Act, 2015 - appellant filing written statement after a delay of 95 days post the maximum extendable period despite last opportunity with cost - Again failing to serve a copy of written statement to respondent even by next date of hearing - Not offering any explanation - Appellant not entitled to condonation of delay. (Para 18, 22)
Facts of the case:
The appellant and the respondent are brothers and own one floor each of ancestral property bearing No. 142 in Devli Village, Delhi. The ground floor was possessed and owned by the respondent, whereas the first floor was in the name of the appellant.
The respondent approached the appellant offering to purchase the first floor of the ancestral property. Subsequently, an agreement to sell was entered into between the parties for total consideration of Rs. 7.5 lakhs, of which an amount of Rs. 1 lakh was paid as earnest money to the appellant. This agreement was subsequently not honoured.
Respondent later approached the Civil Court praying for a decree of specific performance of the agreement to sell by directing the appellant to receive the balance sale consideration and execute/register the sale deed in favour of the respondent. Additionally, the respondent sought to permanently injunct the appellant from alienating the property in favour of any third party. Alternatively, recovery of damages of Rs. 2 lakhs with pendent lite and future interest @ 18% per annum was sought by the respondent.
The appellant appeared through counsel on 15.05.2017 wherein the Civil Court granted the appellant 30 days to file his written statement. After noticing that despite several opportunities (including one beyond the maximum period of 90 days) the appellant had failed to file any written statement or deposit costs and that the matter could not be adjourned repeatedly, the Civil Court closed the appellant’s opportunity of filing written statement and struck off his defence. Even on the next hearing on 03.11.2017, the appellant’s Counsel did not appear or supply a copy of the written statement to the respondent.
The appellant approached the High Court in revision, which has been dismissed.
Finding of the Court:
Appellant is not entitled to condonation of such delay.
Result: Appeal disposed of.
JUDGMENT :
1. Leave granted.
2. This Civil Appeal is directed against order dated 26.11.2018 passed by the Delhi High Court whereby appellant’s revision petition against the order of the Civil Court which closed his right to file written statement under Order VIII Rule 1 of the Code of Civil Procedure, 1908 (hereinafter “CPC”) and struck-off his defence owing to repeated delays and non-adherence of prescribed deadlines, has been dismissed.
FACTS
3. The appellant and the respondent are brothers and own one floor each of ancestral property bearing No. 142 in Devli Village, Delhi. The ground floor was possessed and owned by the respondent, whereas the first floor was in the name of the appellant.
4. It has been claimed that in February 2017, the respondent approached the appellant offering to purchase the first floor of the ancestral property. Subsequently, an agreement to sell was entered into between the parties on 17.03.2017 for total consideration of Rs. 7.5 lakhs, of which an amount of Rs. 1 lakh was paid as earnest money to the appellant. This agreement was subsequently not honoured and a legal notice was served upon the appellant by the respondent on 13.04.2017, calling upon him to accept consideration and perform his part of the contract.
5. Claiming that the appellant was attempting to sell the suit property to third parties, the respondent later approached the Civil Court praying for a decree of specific performance of the agreement to sell dated 17.03.2017 by directing the appellant to receive the balance sale consideration and execute/register the sale deed in favour of the respondent. Additionally, the respondent sought to permanently injunct the appellant from alienating the property in favour of any third party. Alternatively, recovery of damages of Rs. 2 lakhs with pendent lite and future interest @ 18% per annum was sought by the respondent.
6. The appellant was served on 01.05.2017 and he appeared through counsel on 15.05.2017 wherein the Civil Court granted the appellant 30 days to file his written statement. On 17.07.2017, noting that no written statement had been filed till then, the Court granted the appellant a final opportunity of two weeks to file his written statement. On 18.09.2017, the Court observed that despite the last opportunity having been accorded more than two months ago, no written statement had been filed. Nevertheless, the Court granted another final opportunity, subject to payment of Rs. 3,000 costs and the matter was posted for 11.10.2017. On this date, appellant sought multiple pass overs but his Counsel did not appear before the Court. After noticing that despite several opportunities (including one beyond the maximum period of 90 days) the appellant had failed to file any written statement or deposit costs and that the matter could not be adjourned repeatedly, the Civil Court thus closed the appellant’s opportunity of filing written statement and struck off his defence. Even on the next hearing on 03.11.2017, the appellant’s Counsel did not appear or supply a copy of the written statement to the respondent, as noted in the Trial Court’s daily order.
7. The aggrieved appellant approached the High Court in revision, which noted how he had been granted repeated opportunities and yet the written statement was not filed within 120 days of notice. Relying upon the order of its coordinate bench in Oku Tech Pvt. Ltd. vs. Sangeet Agarwal and Others, 2016 SCC Online Del 6601 wherein it was held that there was no discretion with courts to extend the time for filing the written statement beyond 120 days after service of summons, the Delhi High Court summarily dismissed the petition.
CONTENTIONS OF PARTIES
8. The appellant’s primary contention is that the reliance on Oku Tech (supra) was erroneous as it was rendered in light of Order VIII Rule 1 of CPC as amended by the Commercial Courts Act, 2015 which in turn was applicable to commercial disputes only. The present matter was highlighted as being noncommerci
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