IN THE HIGH COURT OF DELHI AT NEW DELHI
Manoj Kumar Ohri, J.
Walltracts India Pvt. Ltd. – Appellant
Versus
Somfy India Pvt. Ltd. – Respondent
FAO 207 of 2022
Decided On : 04-05-2023
Order 37 Rule 4 CPC - Maintainability of Appeal - Order 37 Rule 4 CPC - Summary Suit - Order 37 Rule 4, Order 9 Rule 13 CPC - Summary Suit Procedure - Setting Aside Ex-Parte Decree - Appeal Maintainability - Statutory Right - Principles Governing Order 37 CPC - Supreme Court Interpretation - Setting Aside Decree - Stay of Execution - Leave to Defend Suit
Fact of the Case:
The appellant sought setting aside of the ex-parte judgment and decree passed in a summary suit for recovery of money. The respondent raised a preliminary objection to the maintainability of the appeal, arguing that the impugned order under Order 37 Rule 4 CPC is not appealable under Order 43 Rule 1 CPC.
Finding of the Court:
The Court upheld the preliminary objection and dismissed the appeal, clarifying that it did not consider the merits of the case.
Issues: The main issue was the maintainability of the appeal under Order 37 Rule 4 CPC and whether an appeal could be deemed maintainable against the order passed under Order 37 Rule 4 of CPC.
Ratio Decidendi: The Court emphasized that appeal, being a statutory right, must be explicitly provided for in a statute and cannot be inferred or assumed for practical convenience. It also highlighted the principles governing a suit under Order 37 CPC as interpreted by the Supreme Court, emphasizing that Order 37 is a complete code in itself and does not allow borrowing remedies from other provisions of the CPC outside of the Order 37 code.
Final Decision: The appeal was dismissed, and the appellant was given the liberty to seek appropriate remedy in accordance with the law.
JUDGMENT
Manoj Kumar Ohri, J.
CM APPL. 34861/2022 (exemption)
1. Allowed, subject to all just exceptions.
2. The application stands disposed of.
FAO 207/2022 and CM APPL. 34860/2022 (stay)
3. By way of present appeal, the appellant assails the order dated 13.05.2022 whereby its application filed under Order XXXVII Rule 4 CPC read with Order IX Rule 13 CPC read with Section 151 CPC was dismissed.
4. By way of the above application, the appellant has sought setting aside of the ex-parte judgment and decree dated 25.04.2016 passed in Civil Suit No.116/2015 titled as Somfy India Pvt. Ltd. Vs. Walltracts (India) Pvt. Ltd..
5. Mr. Aaditya Vijay Kumar, learned counsel for the respondent took a preliminary objection to the maintainability of the appeal. He submitted that the impugned order having been passed under Order 37 Rule 4 CPC is not appealable under Order 43 Rule 1 CPC.
6. The necessary facts for adjudication of the present appeal are that the respondent has filed the underlying summary suit for recovery of money under Order XXXVII Rule 1 CPC. In the suit, it was claimed that the plaintiff was in the business of Electrical motors and Controls for automation of window coverings. The appellant/defendant being in hospitality industry approached the respondent/plaintiff for supply of its products. The appellant placed orders whereby the respondent No.1 raised the invoices. The appellant however, failed to clear the outstanding dues which led to the filing of the suit. The summons in the suit were duly served on the appellant. The appellant has claimed to have received the summons on 10.03.2016 and also informed its counsel to appear. However, its counsel on account of suffering from infection failed to appear before the Court. The Vakalatnama/Memo of Appearance was also filed beyond the permitted time on 25.04.2016.
7. Although learned counsel for the appellant sought to advance arguments on the merits of the case, however, considering that the maintainability itself has been called into question, this Court sets out to decide the issue of maintainability at the first instance as merits of the case is not a relevant consideration at this stage. Learned counsel for the appellant could not refer to any CPC provision under which the appeal would fall, however has contended that due to likeness of the two provisions, which essentially deal with power of the Court to set aside an ex-parte decree, appeal may be deemed maintainable against the order passed under Order 37 Rule 4 of CPC, since it is maintainable against an order passed under Order 9 Rule 13 of CPC.
8. This rudimentary parity being drawn to maintain the appeal when no provision has been provided for in the CPC is not even ingenuous for the Court to appreciate the attempt. Appeal, which is a statutory right must be explicitly provided for in a statute and can't be inferred or assumed for practical convenience.
9. Pertinently, Order 37 CPC relates to summary procedure applicable to summary trial for expeditious adjudication of commercial suits. Under sub-rule 2, on being served, a defendant is required to enter appearance, failing which the averments in the plaint are deemed admitted and the plaintiff becomes entitled to a decree. The defendant is required to appear within ten days of the receipt of summons and file memo of appearance. On defendant's appearance, the plaintiff is required to serve the defendant with summons for judgment and within ten days of such service, the defendant is required to apply for leave to defend the suit. The Court thereafter either passes an order dismissing the leave to defend and decreeing the suit, or grants conditional leave to defend on such conditions as it may think fit, or grants unconditional leave to defend.
10. The principles governing a suit under Order 37 CPC have been delineated by the Supreme Court in IDBI Trusteeship Services Limited v. Hubtown Limited, reported as (2017) 1 SCC 568, where it has been held that Order 37 CP
The main legal point established in the judgment is that appeal is a statutory right and must be explicitly provided for in a statute. The judgment also emphasizes the principles governing a suit und....
The appeal filed under Order 43 Rule 1 does not countenance an appeal against the Order passed under Order 37 Rule 4 of CPC.
The court ruled that failure to serve summons for judgment invalidates an ex parte judgment, emphasizing the mandatory nature of procedural requirements under Order 37 of the CPC.
Setting aside of ex parte judgment and decree – Defendant is obliged to apply for leave to defend only after he has been served with summons for judgment.
A defendant must demonstrate justifiable reasons for absence to succeed in an application under Order 9 Rule 13 CPC.
The court ruled that appeals against ex-parte decrees must be filed under Order XLIII Rule 1(d) of the CPC, not Section 96, which applies to original decrees.
No limitation under Article 137 for Order IX Rule 7 CPC; ex parte parties may participate in ongoing proceedings if good cause shown.
A defendant's application for leave to defend must be considered on its merits and cannot be dismissed for non-prosecution.
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