SHANTILAL GULABCHAND MUTHA Vs TATA ENGINEERNG & LOCOMOTIVE CO.LTD.&ANR
Bench: B.S. CHAUHAN,FAKKIR MOHAMED IBRAHIM KALIFULLA
Case number: C.A. No.-006162-006162 / 2005
Diary number: 17517 / 2005
Advocates: V. D. KHANNA Vs
MANIK KARANJAWALA
Page 1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.6162 OF 2005
Shantilal Gulabchand Mutha … Appellant
Vs.
Tata Engineering & Locomotive Co. Ltd. & Anr. … Respondents
O R D E R
1. This appeal has been preferred against the judgment and order
dated 22.6.2005 of the High Court of Judicature at Bombay, passed in
Appeal No.478 of 2005 in Notice of Motion No.503 of 2004 in Suit
No.1924 of 1988.
2. Facts and circumstances giving rise to this appeal are :
A. That the appellant had purchased five Tata Diesel Vehicles
from the respondent No.1 for a sum of Rs.9,58,913/- which was to be
paid in 8 installments through respondent No.2 as per repayment
schedule. The appellant alleges that eight Bills of Exchange were
drawn by the respondent no.1 upon the respondent no.2 – banker of
Page 2
the appellant and by way of which the entire amount was paid.
Respondent no.1 filed Suit No.1924 of 1988 on 2.6.1988 against the
appellant as well as the banker for recovery of sum of Rs.5,66,000/-
alongwith interest. Summons were served upon the appellant and he
entered appearance through advocate to contest the suit. However,
subsequently under the impression that the entire amount had already
been paid, he did not file the written statement. The High Court
decreed the suit vide judgment and decree dated 12.11.2003 under the
provisions of Order VIII Rule 10 of the Code of Civil Procedure 1908,
(hereinafter referred to as ‘CPC’) without considering any issue
involved therein or taking note of the pleadings in the plaint itself.
B. Aggrieved, the appellant took out a Notice of Motion bearing
no.503 of 2004 in the said suit for setting aside ex parte decree dated
12.11.2003, however, it stood rejected vide order dated 10.12.2004
holding it to be not maintainable in view of division bench judgment
of the Bombay High Court wherein it had been held that any decree
passed under Order VIII Rule 10 CPC could not be subjected to the
application under Order IX Rule 13 CPC.
2
Page 3
C. Aggrieved, the appellant filed the appeal which has been
dismissed vide order dated 22.6.2005 concurring with the learned
Single Judge.
Hence, this appeal.
3. We have heard Shri Prasenjit Keswani, learned counsel for the
appellant and Shri Debmalaya Banerjee, learned counsel for
respondent no.1 and perused the record.
4. This Court in Balraj Taneja & Anr. V. Sunil Madan & Anr.,
AIR 1999 SC 3381 dealt with the issue and held that even in such
fact-situation, the court should not act blindly on the averments made
in the plaint merely because the written statement has not been filed
by the defendant traversing the facts set out by the plaintiff therein.
Where a written statement has not been filed by the defendant, the
court should be little cautious in proceeding under Order VIII,
Rule 10, CPC. Before passing the judgment against the defendant it
must ensure that even if the facts set out in the plaint are treated to
have been admitted, a judgment could possibly by passed in favour of
the plaintiff without requiring him to prove any fact mentioned in the
plaint. It is a matter of Court’s satisfaction and, therefore, only on
being satisfied that there is no fact which need be proved on account
3
Page 4
of deemed admission, the court can conveniently pass a judgment
against the defendant who failed to file the written statement.
However, if the plaint itself indicates that there are disputed questions
of fact involved in the case regarding which two different versions are
set out in the plaint itself, it would not be safe for the Court to pass a
judgment without requiring the plaintiff to prove the facts so as to
settle the factual controversy. The power of the court to proceed
under Order VIII, Rule 10 CPC is discretionary. The court further
held that judgment as defined in Section 2(9) CPC means the
statement given by the Judge of the grounds for a decree or order.
Therefore, the judgment should be self-contained document from
which it should appear as to what were the facts of the case and what
was the controversy which was tried to be settled by the court and in
what manner. The process of reasoning by which the court came to
the ultimate conclusion and decreed the suit should be reflected
clearly in the judgment. The court further held as under:-
“Whether it is a case which is contested by the defendants by filing a written statement, or a case which proceeds ex parte and is ultimately decided as an ex parte case, or is a case in which the written statement is not filed and the case is decided under Order 8 Rule 10, the court has to write a judgment which must be in conformity with the provisions of the Code or at least set
4
Page 5
out the reasoning by which the controversy is resolved.” (Emphasis added)
5. In Bogidhola Tea & Trading Co. Ltd. & Anr. v. Hira Lal
Somani, AIR 2008 SC 911, this Court while reiterating a similar view
observed that a decree under Order VIII, Rule 10 CPC should not be
passed unless the averments made in plaint are established. In the
facts and circumstances of a case, the court must decide the issue of
limitation also, if so, involved.
(See also: Ramesh Chand Ardawatlya v. Anil Panjwani, AIR 2003
SC 2508)
6. In view of the above, it appears to be a settled legal proposition
that the relief under Order VIII Rule 10 CPC is discretionary, and
court has to be more cautious while exercising such power where
defendant fails to file the written statement. Even in such
circumstances, the court must be satisfied that there is no fact which
need to be proved in spite of deemed admission by the defendant, and
the court must give reasons for passing such judgment, however, short
it be, but by reading the judgment, a party must understood what were
the facts and circumstances on the basis of which the court must
proceed, and under what reasoning the suit has been decreed.
5
Page 6
7. The instant case is required to be examined in the light of the
aforesaid settled legal propositions. It is evident from the plaint that
eight Bills of Exchange, all dated 4.6.1982 for the respective amounts
had been inclusive of interest and each one of the said bills were
accepted by the appellant payable at the Mercantile Bank Ltd.
Bombay and the said bills were discounted by the respondent/plaintiff
with its bankers. It is further admitted in the plaint that the bank of
the appellant paid the said amount to the respondent/plaintiff on the
respective dates, as the five amounts have been mentioned in para 5 of
the plaint. However, as the same did not satisfy the entire demand,
the suit was filed with the following prayer:-
“That the Defendant No.1 and Defendant No.2 may be ordered and decreed to pay to the plaintiff the sum of Rs.999388.30p. as mentioned in paragraph 7 above together with interest on the sum of Rs.5,66,000/- at the rate of 18.5% per annum from the date of suit till payments.”
8. The Trial Court while deciding Suit No.1924 of 1988 decreed
the suit vide judgment and decree dated 12.11.2003, which reads as
under:-
“Advocate for the plaintiffs is present. Nobody is present for the defendants. The matter is on board for proceeding against the defendants for want of written statement. Suit
6
Page 7
is of 1988. So far no written statement is filed. Therefore, there shall be decree in favour of the plaintiffs and against the defendants under Order VIII Rule10 of the Code of Civil Procedure for a sum of Rs.9,99,388.30 with interest on the amount of Rs.5,66,000/- at 12% p.a. from the date of the suit till realization and costs. Prayer (a) only of the plaint is granted in the above terms. Decree be drawn up accordingly.”
9. The appellant take Notice of Motion to set aside the aforesaid
judgment and decree which was dismissed and the said order of
dismissal has been approved by the division bench. We are not
examining the issue as to whether such a judgment and decree ex
parte could be subjected to the provisions of Order IX Rule 13 CPC
but the court has not examined as to whether the suit was filed within
limitation and whether on the basis of pleadings, the relief granted by
the court could have been granted. The court did not even consider it
proper to examine the case prima facie before passing the decree, as is
evident from the above quotation. The same is complete impugned
judgment.
10. As the Trial Court failed to meet the parameters laid down by
this court to proceed under Order VIII Rule 10 CPC, the judgment and
decree of the Trial Court dated 12.11.2003 is set aside and the case is
remanded to the Trial Court to decide afresh. The appellant is at
7
Page 8
liberty to file the written statement within a period of 3 weeks from
today and the Trial Court is at liberty to proceed in accordance with
law thereafter. As the matter is very old, we request the Trial Court to
conclude the trial expeditiously. The Original Record, if any, may be
sent back forthwith.
Before parting with the case, we would like to clarify that we
have not decided the issue as to whether application under Order IX
Rule 13 CPC in such a case is maintainable.
The appeal is disposed of accordingly.
...……………………………...................................J. (Dr. B.S. CHAUHAN)
…..………………………….. ...................................J. (FAKKIR MOHAMED IBRAHIM KALIFULLA)
NEW DELHI MARCH 18, 2013.
8