IMPORTANT POINT
The court has discretion to set aside ex-parte decrees and impose conditions, but the conditions should not be onerous or excessive.

JUDGMENT :

The original petition has been filed challenging Ext.P3 order setting aside an ex-parte decree on terms. The original petition has been filed by the defendant contending that the condition to pay Rs.10 lakhs towards arrears rent/licence fee is onerous and should not have been imposed while setting aside an ex-parte decree.

2. According to the petitioner, the petitioner is put in possession of the plaint schedule building on the basis of Ext.P4 Licence Agreement. It is contended that even though the agreement is titled as a licence agreement, it is in fact a lease. The agreement says that there is a liability to pay a licence fee of Rs.1,40,000/-per month from 01.07.2015 onwards. The suit was filed for mandatory injunction and damages for occupation of the premises after the termination of the licence. Even though written statement was filed, the defendant/petitioner remained ex-parte and the suit was decreed ex-parte directing payment of a sum of Rs.23,20,078.85 as arrears of licence fee for the period till January, 2020 and a further direction to hand over vacant possession of the plaint schedule building to the plaintiff/respondent or his power of attorney holder. Ext.P5 is the copy of the judgment. The petitioner filed an application for setting aside the ex-parte decree.

3. The Subordinate Judge, Vatakara allowed the application and set aside the ex-parte decree, on condition of deposit of Rs.10 lakhs towards arrears of rent. The order of the court shows that the petitioner failed to participate in the trial when the suit was listed for trial. The Court found that the attempt of the petitioner is to protract the proceedings. It was noticed that the prescription of the doctor produced along with the application, which cites medical reasons as the reason for non-appearance, was the prescription issued from a skin clinic. It is also stated that no reason was stated for non-representation on the day on which the case was posted for evidence. Despite the above facts, the Subordinate Judge, relying on the judgment in Union of India vs. Ramcharan [AIR 1964 (SC) 215], took the view that the Court need not be extremely strict and a liberal approach is essential to do substantial justice between the parties and hence set aside the ex-parte decree. The Court took into account the fact that no amount has been paid towards the licence fee or rent, as the case may be, after filing the suit and even on the day of the filing of the suit more than Rs.20 lakhs was due as arrears of rent and in the circumstances, directed a deposit of Rs.10 lakhs for the purpose of setting aside the ex-parte decree.

4. Heard Sri.Basil Mathew, counsel for the petitioner and Sri.R.Parthasarathy, counsel for the respondent.

5. The contention of the counsel for the petitioner is that under Order IX Rule 7, though the Court has power to impose conditions for setting aside an ex-parte decree, the conditions so imposed shall not be onerous. It is submitted that even as per the ex-parte decree, the court has not granted a decree for the occupation of the premises after the date of suit and hence the court should not impose a condition for payment of rent for the said period. A further contention is taken that the rental for five months has been waived and there is an agreement for reducing 25% of the monthly rent from June 2020 owing to Covid pandemic. It is further submitted that the petitioner has shown sufficient cause and once sufficient cause is found by the court, a condition as imposed ought not to have been imposed.

6. The counsel placed reliance on a judgment of a learned Single Judge of this Court in Antony Varkey v. South Indian Bank Ltd.[1991 KHC 127], the judgments of the Hon’ble Supreme Court in Vijay Kumar Madan v. R.N.Gupta Technical Education Society [2002 KHC 1257] and G.P.Srivastava v. R.K.Raizada and Others [2000 KHC 1023], the judgment of a Division Bench of this Court in Narikodan Sathyavalli and Another v. Syndicate Bank, Maloor Bra