1. Suit for money recovery — Ex-parte decree — Execution proceedings — Property auction — Application to set aside ex-parte decree under Order IX Rule 13, Code of Civil Procedure. (Para 4 , 5 , 6 , 7 , 8 , 9 )
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2021 Supreme(SC) 552
SUPREME COURT OF INDIA
Uday Umesh Lalit, S. Ravindra Bhat, JJ.
Vishwabandhu - Appellant
Versus
Sri Krishna and Anr. - Respondents
Civil Appeal Nos. OF 2021 (Arising out of Special Leave Petition (Civil) Nos……..…………………...of 2021) (Arising out of Special Leave Petition (Civil) D.No. 1855 of 2020)
Decided On : 29-09-2021
Important Points
Refusal of registered post summons constitutes due service. A party who deliberately avoids proceedings and remains negligent until after a court-ordered auction is disentitled from seeking to set aside an ex-parte decree under Order IX Rule 13 of the CPC.
Subject
Civil Law - Execution of Decree
Act Referred
Headnote
Civil P.C. 1908 - O. 9 R. 13 -- General Clauses Act, 1897 -- S. 27 -- setting aside of ex parte decree -- ex parte decree passed against respondent No. 1/defendant -- property put to auction in execution -- appellant highest bidder -- 1/4th amount deposited -- then respondent No.1/defendant filed application for setting aside ex parte decree -- dismissed -- during pendency of appeal in High Court, sale certificate issued in favour of appellant -- appeal allowed and suit restored -- application for recall of order dismissed -- held -- after passing of ex parte decree, notice was duly acknowledged by respondent No.1/defendant -- allowed property to be put to auction -- after auction, application filed to set aside ex parte decree -- High Court rightly observed that respondent No. 1 was not vigilant -- yet granted relief in his favour -- he was disentitled from claiming any relief -- sale certificate also issued in favour of appellant -- orders passed by High Court set aside -- application filed by respondent No. 1 under order 9 rule 13 dismissed -- appeals allowed. AIR 2007 SC (Supp.) 1705, AIR 1962 SC 1604, (1996) 7 SCC 523 and (2004) 8 SCC 774 relied on. [Paras 19 to 22]
Legal Category Hierarchy
Advocates appeared:
For the Petitioner(s): Mr. Kaushal Yadav, AOR Mr. Ram Kishor Singh, Adv. Mr. E.V. Venugopal, Adv. Mr. Nandlal Kumar Mishra, Adv. Dr. Ajay Kumar, Adv. Ms. Yashoda Katiyar, Adv. Mr. Shafik Ahmed, Adv.
For the Respondent(s): Mr. Pradeep Kumar Yadav, Adv. Mr. Vishal Thakre, Adv. Mr. Abhay Singh Yadav, Adv. Mr. Sanjeev Malhotra, AOR Mr. Sandiv Kalia, Adv. Mr. Satbir Singh Pillania, Adv. Ms. Reena Rao, Adv. Mr. Nand Ram, Adv. Dr. Sushil Balwada, AOR
For the Petitioner(s): Mr. Kaushal Yadav, AOR Mr. Ram Kishor Singh, Adv. Mr. E.V. Venugopal, Adv. Mr. Nandlal Kumar Mishra, Adv. Dr. Ajay Kumar, Adv. Ms. Yashoda Katiyar, Adv. Mr. Shafik Ahmed, Adv.
For the Respondent(s): Mr. Pradeep Kumar Yadav, Adv. Mr. Vishal Thakre, Adv. Mr. Abhay Singh Yadav, Adv. Mr. Sanjeev Malhotra, AOR Mr. Sandiv Kalia, Adv. Mr. Satbir Singh Pillania, Adv. Ms. Reena Rao, Adv. Mr. Nand Ram, Adv. Dr. Sushil Balwada, AOR
Table of Contents
2. Auction purchaser contends defendant deliberately avoided proceedings despite knowledge — Defendant argues for restoration of suit to decide the matter on merits. (Para 17 , 18 )
3. Summons returned as refused constitutes deemed service — Defendant had actual knowledge of execution proceedings but failed to act until after the property auction. (Para 19 , 20 )
4. Refusal of registered postal summons constitutes deemed service — Lack of vigilance and allowing auction to complete disentitles a party from setting aside an ex-parte decree. (Para 19 , 21 )
5. Appeals allowed — High Court orders set aside — Application under Order IX Rule 13, Code of Civil Procedure dismissed. (Para 22 )
6. What is the legal effect of a registered postal summons being returned with a postal endorsement of refusal?
Under Order V Rule 9 Sub-Rule (5) of the Code of Civil Procedure, if a defendant or their agent refuses to take delivery of the postal article containing the summons, the court shall declare that the summons had been duly served on the defendant. (Para 19 )
7. Does a registered notice returned as refused or not available create a presumption of service?
Yes, when a notice is sent by registered post to the correct address and returned with endorsements such as refused, not available in the house, house locked, or shop closed, due service is presumed unless the contrary is proved by the addressee. (Para 19 )
8. Can an ex-parte decree be set aside under Order IX Rule 13 after the property has been auctioned and a sale certificate issued?
A party may be disentitled from claiming relief under Order IX Rule 13 if they were not vigilant and allowed the auction proceedings to be completed and a sale certificate to be issued despite having knowledge of the proceedings. (Para 20 , 21 )
JUDGMENT :
Uday Umesh Lalit, J.
1. Delay condoned.
2. Leave granted.
3. These appeals challenge: (i) the Judgment and order dated 21.04.2006 passed by the High Court1[High Court of Judicature at Allahabad] in FAFO (First Appeal From Order) No.2473 of 2005; and (ii) the Order dated 18.10.2019 passed by the High Court in CMRA (Civil Miscellaneous Recall Application) No. 107616 of 2009 preferred in said FAFO No. 2473 of 2005.
4. Respondent No.2 herein filed a Suit in the court of Civil Judge (Junior Division), Mainpuri, Uttar Pradesh, for recovery of money along with interest submitting inter alia that the defendant in the Suit i.e. Respondent No.1 herein had failed to refund Rs.22,400/- received by him towards part sale consideration for sale of property comprising of Gata No.1616/0.93 acres situated at Nangle Rate, Village Panchayat Mainpuri Rural, Tehsil and District Mainpuri. The Suit was filed on 25.05.1993 and as the summons sent to Respondent No.1 by registered post was received back with postal endorsement of ‘refusal’, the order dated 19.02.1997 passed by the Trial Court was :-
“Case called out. On behalf of plaintiff her counsel is present. Nobody present on behalf of defendant. The registered notice which was sent to defendant, had received with remark refusal. Notice is deemed to be sufficient. No one is present on behalf of defendant, the defendant is being proceed ex-party accordingly. Put up for the ex-parte proceeding on 01.04.1997.”
The matter was thereafter adjourned on few dates and finally on 16.09.1997 an ex-parte decree was passed in favour of Respondent No.2 in the sum of Rs.22,400/- along with interest @ 9%.
5. In the application filed by Respondent No.2 seeking execution of the decree dated 16.09.1997, the property admeasuring 0.93 acres which was subject matter of the agreement to sell, was sought to be attached vide notice of attachment dated 29.05.1999. Later, the property was attached vide order dated 04.12.1999 on the basis of a report filed by the Ameen. The report indicated that since the judgment debtor i.e. Respondent No.1 could not be found on search, drum beats were carried out at the place of residence of Respondent No.1.
6. On 29.01.2000 the following order was passed by the trial court:-
“Case presented today. Case called out. Decree Holder with her counsel present. The report of attachment of property is filed. The decree holder shall take steps for notice under O XXI Rule 66 within 15 days.”
7. On 04.04.2000 a report was filed by the Process Server to the following effect:-
“Today 02.04.2000 I came to Nagla Rate district Mainpuri, and searched Sri Krishna, and served a notice on him and the receipt of the same have been duly acknowledged by him by putting him signature on the copy of notice.”
8. In the aforesaid circumstances, the executing court issued warrant of sale of property on 06.12.2000 whereunder the property was directed to be auctioned on 16.12.2000 and the warrant was to be returned on or before 23.12.2000, duly executed. Accordingly, on 16.12.2000 the property was put to auction in which the present appellant as the highest bidder with a bid of Rs.1,25,000/-. In accordance with the prescribed procedure, 1/4th of the amount was deposited by the appellant.
9. On 19.12.2000 Respondent No.1, for the first time, appeared before the court and filed an application under Order IX Rule 13 of Code of Civil Procedure (‘the Code’, for short) praying that the ex-parte decree dated 16.09.1997 be set aside.
In the application it was asserted:-
“…The applicant executed an agreement to sale in favour of plaintiff, and the applicant was always ready to execute the same till today. Applicant have no money. That the plaintiff by misleading the court and got passed an ex-parte judgment on 16.09.1997 in her favour and an execution petition filed before the Hon’ble Court. That no summon or notice issued from this executing court. That the plaintiff get the execution proceeding transferred to the court of Civil Ju
