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HIGH COURT OF KERALA
K.P.BALACHANDRAN, J
ABY JOSEPH – Appellant
Versus
THE SOUTH INDIAN BANK LTD, REP. BY ITS – Respondent
WP(C)/3256/2009
Cost - Recovery of Money - Order IX Section 13 - The court reduced the exorbitant cost imposed for setting aside an ex parte decree from Rs.10,000 to Rs.2,000, ensuring it remained within reasonable limits for a debtor.
Fact of the Case:
The petitioner, a defendant in a suit for recovery brought by a bank, did not appear, leading to an ex parte decree. Subsequently, the petitioner sought to set aside the decree, which was granted conditionally by the court, imposing a cost of Rs.10,000.
Finding of the Court:
The court observed that the imposed cost was disproportionate and established that such a high amount could prevent a debtor from complying. The court exercised its discretion to reduce the cost to Rs.2,000, maintaining judicial propriety.
Issues: Whether the cost imposed for setting aside the ex parte decree was unconscionable and whether the court had the authority to reduce it.
Ratio Decidendi: The decision emphasized that judicial discretion in imposing costs must be exercised reasonably, especially in cases involving debtors who may face undue hardship.
Final Decision: The cost was reduced from Rs.10,000 to Rs.2,000, with a condition for payment within ten days.
JUDGMENT
Heard the counsel for the petitioner.
2. The petitioner is the defendant in O.S.101/07 on the file of the Sub Court, Pala instituted by the first respondent/bank for recovery of money. The suit was decreed ex parte as the petitioner as also the other defendants in the suit did not appear when the suit stood posted for trial in the special list. Thereafter, the petitioner filed an application to set aside the ex parte decree and the court below vide Ext.P6 order impugned in this Writ Petition, allowed the said application on payment of cost of Rs.10,000/- to the first respondent and producing receipt within ten days.
3. To order the defendant who seeks to get the ex parte decree set aside, to pay an amount of Rs.10,000/- within a period of ten days tantamounts to disallowing the petition filed under Order IX Rule 13 as a person who is a debtor in the normal course will not be able to raise such a huge amount of Rs.10,000/- within ten days and to pay by way of cost to the first respondent/plaintiff. The cost so ordered is highly disproportionate and unconscionable and Ext.P6 order to that extent cannot be sustained.
4. In the result, even without notice to the respondent/decree holder/bank, cost being in the discretion of the court and the court below having exercised the discretion illegally and without any propriety, I reduce the cost imposed vide Ext.P6 order to Rs.2,000/-. The said Rs.2,000/- shall be paid to the first respondent/Bank positively in ten days from today. In case cost is not so paid within ten days, the petitioner shall forfeit the benefit of cost having been reduced and the petition filed under Order IX Rule 13 shall stand dismissed.
5. With the above directions this Writ Petition is disposed of. The petitioner is directed to produce a copy of this judgment in the court below forthwith with notice to counsel for the plaintiff/Bank as this Writ Petition is being disposed of without notice to the respondent/plaintiff. Issue copy of this judgment to the counsel for the petitioner urgently.
K.P.BALACHANDRAN, JUDGE
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