Mithlesh vs Punjab National Bank

S.C. Mahapatra, J.—Daughter-in-law of deceased Defendant No. 11 Babu Ram is Appellant against order refusing to set aside ex-parte decree against Babu Ram. Suit of the Plaintiff is for recovery of Rs. 14,73,400/-. There were several Defendants. Some of whom were the principal debtors and the others the guarantors. Case of Appellant is that when property bequeathed to her by her father-in-law Babu Ram was put to auction she made an enquiry and immediately on the next date coming to know that such auction is on the basis of an ex-parte decree, filed application for setting aside the same on 26.5.1992. In the petition she alleged that Babu Ram had no notice of the suit and accordingly, ex-parte decree is valid. Plaintiff/Respondent contested the application alleging that Babu Ram had notice of the suit but he did not contest and accordingly there is no sufficient cause made out by Appellant for his absence on the date of hearing of the suit.

In the trial Court application as decided on the basis of the records of the suit, affidavits as well as other documents. Trial Court held that application for setting aside the decree at instance of the daugther-in-law is not maintainable, notice was served on Babu Ram who did not appear on the date fixed for hearing of the suit and on that account there is no scope for interfering with the ex-parte decree. It also held that the ex-parte decree being dated 22.9.1986, application for setting aside ex-parte decree is barred by limitation since the same was filed on 26.5.1992.''This is grievance of Appellant.

Mr. Goel, learned Counsel for the Appellant submitted that finding of non-maintainability of the application by legal representative/successor of the Defendant No. 11 is not correct and is liable to be vacated. On the materials available on record there cannot be any conclusion that notice was served on the Defendant No. 11 and in absence of notice to Defendant No. 11 ex-parte decree against him is to be set aside. As regards limitation, it was submitted that immediately knowing about the existence of ex-parte decree against Defendant No. 11 application for setting aside the same has been filed on the next day and accordingly limitation is to be computed from the date of knowledge and the same is within period of limitation. Mr. Grover learned Counsel for the Plaintiff/Respondent on the other hand submitted that on the facts and in the circumstances of the case conclusion of the trial Court on each point is justified and calls for no interference.

No doubt, an application for setting aside an ex-parte decree can be filed by Defendant against whom ex-parte decree was passed. Where such Defendant dies before expiry of period of limitation any of his legal representative can file application to set aside the ex-parte decree. Legal representative can file application to set aside the ex-parte decree. Legal representative can file application to set aside the ex-parte decree legal representative includes a person who succeeds to property of the deceased Defendant. Such succession may be intestate or testamentary. Appellant claims to be a legal representative by testamentary succession. Therefore, to protect the property she has succeeded. She is entitled to file an application to set aside the ex-parte decree its Defendant No. 11 could have filed the same. Where deceased Defendant could not have filed the application, Appellant shall not be entitled to file the same. In this view, application for setting aside ex-parte decree is maintainable. Finding of trial Court on this question is not correct and is reversed. An ex-parte decree can be set aside where Defendant against whom the decree is passed satisfies the Court that there was sufficient cause for his non-appearance on the date fixed for hearing. Same ground is available to a date fixed on adjournment of hearing. An ex-parte decree can also be set aside where such Defendant satisfies the Court that the summons was not duly served. In this case, Appellant has prayed to set aside the ex-parte decree on the ground that summons was not duly served on Defendant No. 11.

While Appellant filed affidavit that notice of suit was not served on Defendant No. 11, Plaintiff filed affidavit to the effect that such notice was duly served on Defendant No. 11. There is no order of trial Court that service of notice on Defendant No. 11 is sufficient. In absence of such an order, report of Commissioner who served notice on Defendant No. 11 and his endorsement on the notice can be examined to find out whether the notice was duly served. Report of the Commissioner indicates that he served the notice on Defendant No. 11. Endorsement in the notice indicates that son of Defendant No. 11 received notice. Inconsistency in both the documents has not been explained in the trial Court. When endorsement of the notice indicates that notice was received by son of Defendant No. 11. We are inclined to prefer this endorsement and come to conclusion that notice was received by son of Defendant No. 11.

Under Order 5 Rule 11 CPC service is to be made on the Defendant in person where it is practicable. There is no material on record to come to conclusion that notice on Defendant No. 11 personally was not practicable. Notice can also be served on an agent of Defendant duly empowered to accept service. No material is available in record of the trial Court that son was duly empowered by Defendant No. 11 to receive notice. Even where son is not so empowered by Defendant No. 11 to receive notice. Even where son is not so empowered, notice received by him can be treated as sufficient if condition as provided under Order 5 Rule 15 CPC are satisfied. Such service would be sufficient where son received the notice as member of the joint family of the father provided Defendant No. 11 was found absent from his residence to receive notice or there was no likelihood of being found at his residence within a reasonable time and he has no agent duly empowered to receive the notice. Trial Court has not recorded any finding in this respect as to whether Defendant No. 11 was not available at his residence to receive the notice. Report of the Commissioner does not show that there was no likelihood of Defendant No. 11 being available at his residence within a reasonable time to accept notice. Rather such report shows that commissioner served notice on Defendant No. 11. In the circumstances, we are satisfied that precondition of Order 5 Rule 15 CPC are not satisfied to hold that the notice on Defendant No. 11 was served duly. Even if it is assumed that in absence of personal service where service is made the son as member of the Joint family, it is only irregular in nature, such notice would be adequate if Court is satisfied that the Defendant 11 had notice of the date of hearing and had sufficient time to appear in the suit as provided in Order 9 Rule 13 Second Proviso of the Code. If the Court would have been satisfied that Defendant No. 11 had knowledge of the suit or but for his wilful conduct would have known of the date of hearing in sufficient time to answer the Plaintiff''s claim, ex-parte decree is not to be set aside.

In this case, there is no evidence that prior to the ex-parte decree, Defendant No. 11 had knowledge of the suit. There is also no material to draw an inference that but for his wilful conduct he could have known about the suit. Thus, proviso added by this Court is not attracted. There is also no acceptable evidence that Defendant No. 11 had any knowledge of the suit. Report of Commissioner indicating that he served summons on Defendant No. 11 is not acceptable in view of endorsement in the notice itself. In this Court Plaintiff introduced a new fact that after notice was offered to Defendant No. 11, he instructed his son to receive the notice and accordingly, notice was served on son of Defendant No. 11. This case was not made out in the trial Court and accordingly, is to be discarded as an afterthought. On the aforesaid discussions, we are satisfied that no notice was served on Defendant.

Mr. Grover, learned Counsel (or Plaintiff-Respondent submitted that trial Court having recorded in the order sheet to proceed ex-parte against Defendant No. 11, impliedly held that notice on him is sufficient. In case the report of the Commissioner and endorsement in the notice would have been consistent, we might have considered force of such submission. Where records do not lead to such an inference by implication only right of a party should not be defeated to his prejudice. So far as the application for setting aside the ex-parte decree being barred by limitation there is no evidence that Defendant No. 11 had any knowledge of ex-parte decree, within the period of limitation. Plaintiff filed the notice sent by an Advocate. purported to be on behalf of Defendant No. 11 not to resort to coercive action against Defendant No. 11 for realisation of decretal amount. Other document is a copy of reply by Plaintiff to the Advocate that no coercive action is being taken but execution proceedings has been initiated to recover the amount, Mr. Grover submits that in 1988 the Defendant No. 11 had knowledge of the ex-parte decree and no explanation having been given why for three years he did not file application for setting aside ex-parte decree, it should be held that such application by daughter-in-law is barred by limitation. An advocate writing a letter on behalf of a person would not lead to inference that he was authorised by that person. Advocate could have been examined as a person on behalf of Plaintiff to state on oath that he was authorised by Defendant No. 11. Reply to the advocate stands on the same position. We are not able to draw inference from the two documents dated 15.4.1988 and 18.4.1988 that Defendant No. 11 had knowledge of the ex-parte decree at least by that time.

In view of our discussions as made above, we are satisfied that there was no notice on Defendant No. 11. There was no knowledge of Defendant No. 11 about the ex-parte decree and Appellant had also no knowledge of the same before the property was put to auction in execution of the decree. Thus, the ex-parte decree is liable to be set aside to give opportunity to the Appellant to contest the suit. It is true that a decree once set aside may ensure to the benefit of other Defendants if the Court so directs. In the present case, however, we are not inclined to give the benefit to other Defendants since no other Defendant has come to set aside the ex-parte decree and interest of the Appellant is limited to the property put to auction which she has alleged to have been bequeathed to her. Therefore, setting aside of the ex-parte decree is limited to Appellant alone and to no other Defendants.

When we set aside the ex-parte decree a valuable right of the Plaintiff is taken away. It can be compensated by cost or by imposing such conditions that in case a decree is obtained against the Appellant the amount can be recovered from her. Plaintiff being a nationalised Bank and Appellant being a lady, we are not inclined to direct payment of costs. However, interest of Plaintiff can be protected in case Appellant is directed to furnish adequate security other than cash or Bank guarantee to the satisfaction of the trial Court front which the amount claimed in the suit can be recovered. On being satisfied that security has been furnished, trial Court shall proceed with the suit treating Appellant as Defendant No. 11 in place of deceased. In case Plaintiff so prays, other legal representative of the deceased Defendant No. 11 shall be made party Defendants. In case security is not furnished by Appellant within time to be stipulated by the trial Court, the ex-parte decree shall stand affirmed and benefit of contesting the suit would not be available to the Appellant. In result, appeal is allowed. Ex-parte decree is set aside subject to the satisfaction of the condition as imposed. There shall be no order as to costs. Records may be sent immediately to the trial Court.