Non-payment of costs should not negate the right to file a written statement if filed within the statutory period, ensuring substantive rights are preserved.

JUDGMENT :

Advait M. Sethna, J.

1. This commercial appeal is filed against the final judgment/order dated 4 September 2023 passed in Notice of Motion no. 1823 of 2023, in commercial suit No. 137 of 2022, by the District Judge, City Civil Court, Mumbai (“Impugned Order” for short). Considering that a short issue is involved the appeal is taken up final disposal at the stage of admission. It appears from the record that the respondent (plaintiff) has not entered apperance as also observed by us in our order dated 16 January 2025.

2. The respondent (plaintiff) filed the commercial suit no. 137 of 2022 on 17 January 2022, before the City Civil Court, Mumbai with the following substantive prayer :-

“a. That the Defendants be decreed and ordered to pay to the Plaintiffs the sum of Rs. 11,77,464/- along with the interest on Rs. 11,77,464/- at 18% per annum or such other rate that may be awarded by this Honourable Court from the date of filing of the suit till realisation.”

3. By the impugned order, the appellant’s (defendant’s) right to file the written statement has been forfeited, on the ground that the conditional order passed by earlier the trial court 30 November 2022 taking the written statement on record was subject to the apellant (defendant) paying cost of Rs. 1500/-, which was not complied with. As the delay in filing the written statement had passed the statutory period of 120 days as on 4 September 2023, the trial court by the impugned order rejected the Notice of Motion No. 1823 of 2023 of the appellant (defendant) to take such written statement on record.

Factual Matrix

The relevant facts are noted below :-

4. Purusant to the filing of the commercial suit on 7 January 2022 the defendant was served with writ of summons in the suit on 2 May 2022. The appellant (defendant) presented his written statement on 17 August 2022 along with a notice of motion no. 3232 of 2022 filed by appellant (defendant) before trial court to take the written statement on record.

5. The trial court by an order dated 30 November 2022 held that the written statement was filed within the stipulated period of 120 days from the date of receipt of service of summons by the appellant (defendant) as required under Order VIII Rule 1 of Civil Procedure Code, 1908 (‘CPC’ for short) However, the trial court made such order conditional on the appellant (defendant) to pay cost of Rs. 1,500/- to the respondent (plaintiff) only after which the written statement would be taken on record.

6. It was on 7 January 2023 that the suit of the respondent (plaintiff) was listed for hearing before trial court. However, the appellant (defendant) did not appear on said date. In view thereof, the trial Court directed that as the conditional order of payment of cost was also not complied by the appellant (defendant) the suit shall proceed without the written statement and was placed for recording evidence on the next date, i.e., 4 February 2023.

7. Pursuant to the above, the appellant (defendant) filed a another Notice of Motion No. 1823 of 2023 in April 2023 for taking his written statement on record. The trial court by the impugned order dated 4 September 2023 rejected the said Notice of Motion No. 1823 of 2023 of the appellant (defendant) by refusing to take such written statement on record, for the reasons recorded in the impugned order.

Submissions :-

8. In the above backdrop, Mr. Kapil Shah, learned counsel for the appellant (defendant) would emphatically oppose the impugned order of the trial Court dated 4 September 2023 and would pray that the impugned order be quashed and set aside.

9. Mr. Shah referring to the order of the trial Court dated 30 November 2022 would submit that the court found that the written statement of the appellant (defendant) was within a period of 120 days from the date of service of summons by the appellant (defendant). Thus the undisputed position would be is that the written statement has been filed by the appellant (defendant) within the statutory time pe