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2022 Supreme(Cal) 391
IN THE HIGH COURT OF CALCUTTA
Shekhar B. Saraf, J.
Aaryan Projects Private Limited - Appellant
Versus
Klowin Infrastructure Private Limited. - Respondent
G.A. No. 3 of 2021 In C.S. No. 205 of 2017
Decided On : 30-08-2022
Important Points
Subject
Civil Law - Civil Procedure
Act Referred
CIVIL PROCEDURE CODE : O.9 R.13
Headnote
CPC - Setting aside ex-parte decree - Order IX Rule 13 - [CPC] - [Order IX Rule 13] - The court discussed the relevant provisions of Order IX Rule 13 of the CPC, emphasizing the conditions for setting aside an ex-parte decree. The court also referred to the Supreme Court's decision in Bhivchandra Shankar More v. Balu Gangaram More and highlighted the substantive scope of Order IX Rule 13, emphasizing the requirement of summons being duly served or the defendant being prevented by sufficient cause from appearing. The court found that the defendant was not duly served and was prevented from appearing, thus allowing the application to recall/setting aside the ex-parte decree.
Fact of the Case:
The plaintiff and defendant entered into an agreement for property development. The plaintiff transferred an amount to the defendant, and a loan amount was agreed upon. The defendant failed to repay the sum, leading to an ex-parte decree in favor of the plaintiff. The defendant sought to recall the decree, alleging lack of proper service and deliberate fraud by the plaintiff.
Finding of the Court:
The court found that the defendant was not duly served with the summons and was prevented from appearing in the suit. It also noted the suppression of material facts by the plaintiff to secure transfer of the suit to the undefended list. As a result, the court allowed the application to recall/setting aside the ex-parte decree and directed the defendant to file its written statement within 45 days.
Issues: The issues revolved around the service of summons, the defendant's awareness of the suit, and the plaintiff's conduct in securing the transfer of the suit to the undefended list.
Ratio Decidendi: The court emphasized the requirement of summons being duly served or the defendant being prevented by sufficient cause from appearing, as per Order IX Rule 13 of the CPC. It also highlighted the principle of uberrima fides, stating that suppression of material facts disqualifies a litigant from obtaining any relief.
Final Decision: The application seeking the recalling/setting aside of the ex-parte decree was allowed, and the defendant was directed to file its written statement within 45 days.
Mr. Abhrajit Mitra, Sr. Advocate, Mr. Jishnu Chowdhury, Advocate, Mr. Sankarsan Sarkar, Advocate, Mr. Mehboob Rahman, Advocate, Ms. Tahmina Aslam, Advocate, for the Appellant; Mr. Rupak Ghosh, Advocate, Mr. Nikunj Berlia, Advocate Mr. Varun Kothari, Advocate, for the Respondent
JUDGMENT
Shekhar B. Saraf, J. - The petitioner (the defendant in C.S. No. 205 of 2017) Klowin Infrastructure Private Limited had filed this application bearing G.A. No. 3 of 2021, praying for recalling or setting aside of the ex-parte decree dated June 12, 2019 passed by this Court. The application has been filed under Order IX Rule 13 of the Code of Civil Procedure, 1908 (hereinafter referred to as 'CPC'). The petitioner also prays for an order of injunction restraining the plaintiff to proceed in E.C. No. 393 of 2019 which has been filed pursuant to the ex-parte decree passed by this Court on June 12, 2019.
2. The facts of the matter are as follows:-
a) The plaintiff company and the defendant company entered into an agreement dated August 28, 2013 wherein both the parties were to jointly develop properties situated at Raipur. On August 28, 2013 the plaintiff company transferred an amount of Rs. 15,00,000/- (Rupees Fifteen Lakhs Only) through Real Time Gross Transfer (RTGS) from an account maintained at ICICI Bank, Chowringhee Branch, Kolkata - 700016 to the defendant company's bank account.
b) Subsequently, based on a meeting between both the parties it was agreed that the defendant would look into the construction work and the plaintiff would lend a sum of Rs. 1, 35, 00, 000/- (Rupees One Crore and Thirty-Five Lakh Only) inclusive of Rs. 15, 00, 000/- (Rupees Fifteen Lakh Only) already paid to the defendant on August 28, 2013. The loan amount was offered for a period of 2 (two) years and interest to be calculated at the rate of 18% per annum.
c) After two years, the defendant failed to pay the due sum to the plaintiff company and also the defendant did not take any steps whatsoever with respect to the agreement dated August 28, 2013. Despite various attempts made by the plaintiff company through its advocate the defendant failed to repay the sum. At the time of contesting the instant suit the defendant did not enter appearance either in person or through its advocate. Due to such conduct of the defendant the suit was fixed for hearing as 'Undefended Suit' and thereafter an ex-parte decree dated June 12, 2019 was granted in favour of the plaintiff. This application seeks recalling of the same.
3. Mr. Rupak Ghosh, counsel appearing on behalf of the petitioner/defendant has made the following arguments:
a) The petitioner/defendant came to know of passing of the ex- parte decree dated June 12, 2019 by this court for the first time on January 5, 2021.
b) The petitioner/defendant was never aware of filing of the present suit at any given point of time on or before March 26, 2019. In this regard, the notice under Section 11 of the Arbitration and conciliation Act, 1996 dated March 18, 2019 and the reply of the plaintiff's advocate dated 26th March, 2019 have been presented.
c) The petitioner/defendant alleges that the then advocate of the defendant failed or neglected to take proper steps to follow up the proceedings in the instant suit wherein the ex-parte decree dated June 12, 2019 has been passed.
d) The petitioner/defendant states that it would appear clearly from the cause title of the instant suit that the defendant is described to have its registered office at Plot No. 638, Urla Industrial Complex, Raipur, Chhattisgarh, however, the said address of the petitioner/defendant has changed to BSNL Office, Bidhansabha Road, Police Station-Morwa, Raipur, Chhattisgarh based on an online application dated March 11, 2019, made before the Ministry of Corporate Affairs by the defendant. In this regard, documents from the Ministry of Corporate Affairs showing such application for change of address of the defendant have been presented.
e) The petitioner/defendant argues that the plaintiff was informed of such change of address via advocate's letter dated March 18, 2019, but, despite such knowledge of change of address of the defendant, the plaintiff deliberately did not take any steps for amendment of the plaint recording the correct address of the
