R.R. Shah and Others vs V. Padmanabhan

V. Ramaswami, J.—This is an appeal against an order dismissing Application No. 1264/85 filed by the Appellant to set aside the exparte decree passed in C.S. No. 618 of 1980. That suit was filed by Respondents herein for specific performance of an agreement for sale, said to have been entered into between the Appellant and the 1st Respondent herein on 23.12.1979 in respect of premises and building, bearing door No. 862, Poonamallee High Road, Madras-10. Under the said agreement, the Defendant/Appellant is stated to have agreed to sell the property to the 1st Respondent for a consideration of Rs. 4,25,000 and received an advance of Rs. 15,000 on the date of the agreement. It is further stated as per the agreement, the Defendant has to execute a sale deed in favour of the 1st Respondent herein or any of his nominees and that the 1st Respondent has nominated Plaintiffs 2 to 5 (respondents herein) as his nominees. Accordingly, the prayer in the suit is to execute and register sale deed in favour of Plaintiffs 2 to 5 in respect of the property agreed to be sold. There was an alternative prayer for a direction directing the Defendant to return the sum of Rs. 15,000 paid as advance with interest at 18% p.a. At the time when the agreement was executed the Defendant was residing at No. 862, Poonamallee High Road, Madras-10. The suit was decreed ex parte on 28.2.1983. It appears that there was an execution petition in E.P. No. 21/84 and in that petition, the First Assistant Registrar of this Court has executed the sale deed and registered the same on deposit of the entire consideration on 7.8.84. The Defendant filed Application No. 1264/85 to set aside the ex parte decree on the ground that the summon in the suit was not served on him and that he was also not aware of the filing of the suit. On the main defence that may be taken in the suit, the Defendant had stated that the first Plaintiff was not a man of means, that he paid only a small advance of Rs. 15,000, that he was not in a position to raise sufficient funds for the purchase of the property, that finding his inability to raise funds, he expressed his inability to proceed with the sale and abandoned the agreement and forfeited the advance amount and accordingly the agreement was duly treated as cancelled. His further case was that thereafter he sold the property to Mrs. Shahera and Ors. for Rs. 4,25,000 on 1.12.1980 and handed over possession to them also. The learned judge was of the view that though the summon has not been served on the Appellant he had knowledge of the suit and the execution proceedings and that "in all probability the Petitioner has thought that in as much as the summons have hot been served on him personally he can wait till he got direct notice to move the court and has come forward with this application after service of notice in the delivery application of his wife", and in that view he dismissed the application. Under Order 9, Rule 13, Code of Civil Procedure, a Defendant, against whom an ex parte decree has been made, may apply to the court for setting aside the decree-

(1) if he satisfied the court that the summons was not duly served;

(2) that he was prevented by any sufficient cause from appearing when the suit was called for appearance.

The application has been made on both grounds. Admittedly, the summon has not been served on the Appellant. The case of the Appellant was that he was originally residing in No. 862, Poonamallee High Road, Madras-10 and that some time in January, 1980 he left that place and was staying in No. 6, Vaikkakaran St., Purasawalkam, Madras-7 for about 10 days and thereafter came to live at No. 44, Mettu Street, Ayanavaram, that he subsequently shifted to Arasu Street, Ram Nagar, Ambattur and he is now residing there ever since March, 1980. This fact, according to the Appellant, was known to the Plaintiff, but in spite of the same, the Plaintiffs deliberately sent the summons to wrong address and obtained an ex parte decree later without serving the summons. The suit summon was taken by the bailiff to the Defendant at the suit house bearing door No. 862, Poonamallee High Road, Madras-10. The bailiff endorsement, dt. 5.3.1982 was to the effect that the "defendant is not found at the address and his whereabouts are not known". It appears that after this return, the Plaintiffs had not taken any steps to send the summons for the second time. In fact, the matter was posted before the Master, High Court, Madras for taking steps, but no steps were taken and ultimately the suit itself was posted in the default list for dismissal. It is at that stage, the Plaintiffs seem to have requested the court for substituted service and that was ordered. Publication was made in Malai Murasu on 7.11.1982. It is stated that the summon was affixed in the Court notice board and at No. 862, Poonamallee High Road, Madras-10. It is the case of the Defendant/Appellant that the Plaintiffs were fully aware that he is not residing in that place even at the time of filing of the suit and "still they gave the address of the Defendant as No. 862, Poonamallee High Road, Madras-10. In support of this, he relied on a probate of the will relating to the property in O.P. No. 447/80 issued to the Appellant on 22.1.1980, which is marked as Ex. A1. This discloses that he was residing at the time at No. 6, Vaikkakaran St., Madras-7. He has filed Ex. A3, certificate given under the Income Tax Act, in which his address is given as No. 44, Mettu Street, Ayanavaram. There are other documents which also show the address as No. 44, Mettu Street, Ayanavaram. The copy of the probate was given to the Plaintiffs and in fact that was one of the documents referred to in the plaint itself. Further, there is evidence to show that the property was sold to a third party by the Defendant and the third party had let out the premises to somebody. It was not the case that nobody was occupying the premises in question. In fact, the learned Judge has found as a fact-that the Appellant was residing at Ayanat varam at the time of filing of the suit. However, he was, of the view that he has been living elsewhere and also in the suit house "at least till 27.11.1980." The above view is on the basis that at the time of execution of the power of attorney deed, his mother, brothers and sisters have been living in No. 862, Poonamallee High Road, Madras-10. There is no dispute that on that date, i.e., on 27-11-1980, his mother, brothers and sisters were living there. The explanation given by the Appellant was that though he was residing outsider since his mother, brothers and sisters were living in the suit house on that date, no distinction has been made so far as his address is concerned. Why this explanation could not have been accepted, no reason has been given by the learned Judge, especially when he has accepted the case of the Plaintiff that he was living elsewhere and not in the suit house. It is also in evidence that subsequent to 1.12.1980, when he sold the house to third party, neither the Defendant nor any of his relations were living in the suit house. The purchaser has taken possession of the house and let it out to some third party. This fact should have been known and in fact, it is the case of the Defendant to at it was known to the Plaintiff. In the circumstances, therefore, we are unable to agree with the learned Judge that the Defendant was also living in the suit house up to 1.12.1980. We are also of the view that the learned Judge's observation that the Defendant must have been aware of the filing of the suit, is based on surmise and not based on evidence. Neither the first Plaintiff nor any of the other Plaintiffs have given evidence in this case that the Defendant was aware of the filing of the suit or the pendency of the proceedings. No document was produced to show that he was aware of the proceedings. The learned Judge seems to have inferred that he should have been aware, on the ground that when the summons were sent to the suit house, the tenant who was occupying the house must have been aware of the filing of the suit or that in any case, when the summons have been affixed in the suit house the "subsequent purchaser should have certainly come to know about the litigation and must have certainly informed the Defendant". Even to accept an oral statement, to that effect, the Plaintiffs have not gone to the box and stated that the occupants were aware of the suit or how they were concerned with the suit. We are of the view that this inference is not possible in order to say that the Defendant was aware of the suit and that he is not entitled to get the exparte decree set aside. Even if the observation of the learned judge that

in all probability the Petitioner has thought that in as much as the summons have not been served on him personally he can wait till he got direct notice to move the court and has come forward with this application after service of notice in the delivery application of his wife.

Is to be accepted still, the Defendant could claim to set aside the exparte decree on the basis that summons have not been served on him. As the summons sent was not served on him and as he was not aware of the proceedings, he can certainly claim that he was prevented from appearing by sufficient cause when the suit was called for hearing. That was the view expressed by this Court in R.M.T.S.S. Dhanasekaran v. State Bank of India 90 L.W. 341 = 1977 1 M.L.J. 27 with which we agree. The publication in Malai Murasu itself seems to be not in order because the summon was sent only once and the normal procedure under the Original Side Rules and Civil Rules of Practice to make another attempt to serve the party by sending it by registered post, has not been followed. The affidavit filed in support of the application for substituted service was signed only by an advocate's clerk and the order of substituted service seems to have been made in a routine manner. In fact, as rightly pointed out by the Learned Counsel for the Appellant, though in paragraph 1 of the affidavit filed in support of the application for setting aside the exparte decree, the Appellant has stated that he was not aware of either the filing of the suit by Respondents or the alleged ex parte decree in the suit obtained by them, this statement was not specifically denied by the Respondents in their counter affidavit. The whole proceedings appear to be somewhat surprising. The agreement of sale is between the Appellant and the 1st Respondent, and there was no privity of contract between the Appellant and Respondents 2 to 5. Further, the relief sought is for directing the execution of the sale deed in favour of Respondents 2 to 5. Even if the first Plaintiff is entitled to nominate the purchaser, the decree shall be in favour of the 1st Plaintiff. At no stage the first Plaintiff has come forward to give evidence nor had he given any statement at the time of the passing of ex parte decree. Only the power of attorney agent of Plaintiffs 2 to 5 has given evidence as P.W. 1 in the ex parte proceedings. Neither the 1st Plaintiff, who is supposed to have nominated Plaintiffs 2 to 5 as nominees, nor the person to whom nomination is addressed, namely the Defendant had said anything about the proceed-ings, and therefore, in the absence of a confirmative statement by the 1st Plaintiff or by the Defendant, it could not be stated that the nomination had taken effect even earlier or it shall be deemed that privity of contract have been established between the Defendant and Plaintiffs 2 to 5. In the face of the allegations in the affidavit that the 1st Plaintiff has expressed his inability to proceed with the sale deed and abandoned the agreement and forfeited the advance there is no substance in the contention of the Plaintiff that the Defendant will not be prejudiced by allowing the ex parte decree to remain, on the ground that he had sold the property to a third party, and if at all, the third party alone will be effected. For one thing, the Defendant may be exposed to damages by the party to whom he has sold prior to the ex parte decree, and another thing is that even if the first sale deed is not to be accepted, he may be entitled to a dismissal of the suit and sell the property to a third party.

The Learned Counsel for the Respondents referred to Order 5, Rule 20 (2), Code of Civil Procedure, and contended that substituted service by an order of the Court shall be as effective as if summons had been duly served on the Defendant and therefore, the service effected in this case shall be deemed to have been served on the Defendant personally. We are unable to agree with this on the facts and circumstances of this case. As we have already stated, the normal procedure has not been followed in this case after the first summon was returned unserved, and the second summon was not sent to the Defendant. Apart from that, we have also stated that the Plaintiffs were aware that the Defendant was not residing in that address, and therefore, sending a summon to wrong address and thereafter saying that the Defendant is not residing there cannot be a ground for ordering substituted sevice.

We are satisfied that this is a just case where the exparte decree will have to be set aside for more than one reason, apart from the doubt as to the correctenss of the procedure adopted and the non-service of the summons and the Defendant admittedly residing in a different place subsequent to 1.12.1980 subsequent to which date alone summons in the suit were sent. The interests of a number of other parties are also involved in this case. As already stated, the Defendant has sold the property on the basis that the agreement between him and the 1st Plaintiff stands cancelled, and the third party's interest has come in, and they have been disputed and the number of proceedings are pending in regard to the same. In the interests of justice, we are of the view, that the suit will have to be decided on merits. There was no delay in the filing of the application to set aside the ex parte decree passed. It may be mentioned that even in the execution proceedings, the Plaintiffs seem to have been following the same procedure as adopted in the suit and summon was sent to the same address. It is at that stage, the Defendant came to know of the proceedings. It was stated orally by the Learned Counsel for the Respondents that they had sent the summons by registered post to the same suit address and they were returned unserved. They have not been filed in the ex parte proceedings or in the seproceedings. In any case, when the notice sent was not served and was returned unserved, 0.4, Rule 8, of the Original Side Rules states that, it shall not be deemed to be the service. Therefore, even if this allegation is true, this will not advance the case of the Plaintiff any further. In view of the foregoing reasons, we are of the view that the Defendant has made out a case for setting aside the ex parte decree, and we accordingly allow the appeal and set aside the order of the learned Judge and allow the Application No. 1264/85 in C.S. No. 618/80. The suit will be listed again for trial on merits. However, there will be no order as to sale.