2025 Supreme(SC) 1550
SUPREME COURT OF INDIA
DIPANKAR DATTA AND MANMOHAN, JJ.
Harirajan Pillai – Appellant
Versus
Siyad – Respondent
Civil Appeal No. 6328 of 2025 [Arising Out of SLP (C) No. 21325 of 2023]
Decided on : 05-05-2025
Important Points
Subject
Civil Law - Commercial Litigation
Act Referred
Headnote
Facts of the case:
The appellant filed a suit for recovery of license fees. The respondent did not file a written statement in the time provided, leading to an ex parte decree. The respondent later sought to set this aside, which the High Court dismissed without addressing key legal issues.
Findings of Court:
The High Court erred in not intervening with the Commercial Court’s order; the ex parte decree is justified and restored.
Issues: Whether the High Court should have interfered with the ex parte decree based on the statutory timelines outlined in the Commercial Court Act.
Ratio Decidendi: The court held that the High Court's dismissal was erroneous, as 120 days for filing a written statement is a hard limit, and discretion to extend must be exercised judiciously.
Result: Appeal allowed; ex parte decree restored.
| Table of Content |
|---|
| 1. details of the appellant's suit and respondent's applications (Para 3 , 4 , 5 , 6 , 8) |
| 2. high court's dismissal and requirements for written statements (Para 7) |
| 3. court's observation on precedence and error by high court (Para 9 , 10 , 11) |
| 4. indefensibility of the high court's order (Para 12) |
| 5. restoration of ex parte decree and execution permissions (Para 13 , 14 , 15 , 16) |
ORDER :
1. Leave granted.
2. We are completely taken aback, having read the judgment and order dated 12th July, 2023 of the High Court of Kerala at Ernakulam, whereby it dismissed a petition under Article 227 of the Constitution [OP (C) No. 946 of 2023] presented before by the appellant.
3. The appellant, as plaintiff, had instituted a suit[CS No. 45 of 2020] on 5th October, 2020, before the relevant Commercial Court, seeking realisation of licence fees amounting to Rs.16,46,906/- (Rupees sixteen lakh forty-six thousand nine hundred six) only with interest thereon @ 12% per annum against the defendant, who is the respondent here. As defendant, the respondent entered appearance in the suit on 10th November, 2020, and sought time to file written statement. The statutory period of 120 (one hundred twenty) days to file the written statement expired on 9th March, 2021. The respondent was set ex parte by the Commercial Court. On 31st March, 2021, the Commercial Court decreed in the manner as follows:
'In the result, suit is decreed with costs. Plaintiff is entitled to realize Rs. 14,40,920/- together with interest thereon at 6% per annum from the date of suit till realization and the costs of the suit from the defendants and their assets.'
4. The respondent filed an application on 24th May, 2022 praying for setting aside of the ex parte decree. An order was passed requiring the respondent to make payment of Rs. 2,000/- (Rupees two thousand) only. The respondent did not pay and, hence, the application for setting aside the decree stood dismissed.
5. On 16th June, 2022, the respondent filed an application for restoration. An order was passed on the restoration application requiring the respondent to keep in deposit Rs. 10,000/- (Rupees ten thousand) only. Though the said amount was deposited by the respondent, it was not brought to the notice of the court and the restoration application was, therefore, dismissed.
6. This prompted the respondent to file a review application. The court reviewed the order earlier passed and restored the application for setting aside the ex parte decree on 18th March, 2023.
7. Aggrieved by the order dated 18th March, 2023, the appellant approached the High Court to set aside the order passed by the Commercial Court. Without exercising its power of superintendence under Article 227 of the Constitution, which was called for, the High Court while dismissing the application of the appellant went on to make the following observations:
'The question whether Section 5 of the Limitation Act, 1963 would come into play, when there is sufficient reason for not submitting the written statement within the time scheduled as mandated under the Commercial Court Act was not addressed by the trial court. In fact, the mandate under the schedule to submit the written statement, attached to the commercial court though intended for speedy disposal of the matter is amenable under Section 5 of the Limitation Act, 1963. But, it shall not be allowed in a routine way unless there is a warranting reason. Unless there is warranting reason to the extent of making the party incapable of submitting the written statement within the stipulated period, the court can extent the benefit under Section 5 of the Limitation Act, so as to advance justice, otherwise, it will result in gross injustice. It is a suit for recovery of an amount of more than Rs.14 lakhs. At this juncture, the learned counsel for the respondent fairly submitted that in addition to the cost ordered by the trial court, which comes to Rs.2000/- and 1000/-, they are prepared to pay or deposit a