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NON-REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL  APPEAL NO.    450    OF 2015 (ARISING OUT OF SLP (C) NO.11191 of 2013)

MAHESH KUMAR JOSHI                       …APPELLANT

VERSUS

MADAN SINGH NEGI                    …RESPONDENT

O R D E R

ADARSH KUMAR GOEL, J.

1. Leave granted.

2. This appeal has been preferred against the judgment and  

order dated 11th May, 2012 passed by the High Court of Delhi at  

New Delhi in CM(M) No.564 of 2012.

3. The question raised for consideration is whether the courts  

below are justified in declining the prayer of the appellant to set  

aside  the   

ex-parte  decree  and  to  grant  leave  to  appeal  to  defend  the  

summary suit.

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4. The respondent-plaintiff  filed  suit  under  Order  XXXVII  of  

the  Code  of  Civil  Procedure  (for  short  “the  Code”)   on  4th  

November, 2009 seeking a decree for Rs.3 lacs with costs and  

interest alleging that the appellant-defendant gave two cheques  

for Rs.3 lacs towards purchase price of Plot No.71-A, measuring  

233  sq.  yard  situated  in  Ram  Park  Extension  Colony,  being  

Khasra  No.196(Main),  village  Loni,  District  Ghaziabad,  Uttar  

Pradesh  which  were  dishonoured  inspite  of  plaintiff  having  

executed  the  requisite  documents  and  handed  over  peaceful  

vacant possession of the plot in question.  Though the summons  

were duly served on the wife of the appellant on 19th December,  

2009, the appellant failed to enter appearance within ten days  

on  which  the  trial  Court  passed  the  ex-parte  decree  on  24 th  

February, 2010.   

5. The appellant sought setting aside of the said decree by  

filling the application dated 25th March, 2010 under Order XXXVII  

Rule 4 of the Code.  He submitted that the power of attorney  

dated 10th October, 2004 in favour of the plaintiff by Smt. Asha  

Negi, the alleged owner of the plot in question, did not specify  

the  plot  number  and  the  appellant  found  no  such  plot  in  

existence  in  the  records  of  the  Ghaziabad  Development  

Authority.  Instead of Plot No.71-A, the number of the plot was  

71 which  did  not  belong to  Asha Negi  but  to  someone else.  

Thus, the appellant did not get possession of the plot and the

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cheques in question could not be taken to be in discharge of any  

liability.  The transaction was without any lawful consideration  

and was void.   

6. The application was contested by the respondent and the  

trial  Court  vide Order dated 12th January, 2012 dismissed the  

application which order has been affirmed by the High Court.    

7. Dealing  with  the  objection  of  the  appellant,  the  Courts  

below  held  that  the  suit  was  for  recovery  on  account  of  

dishonour of cheques and was not in respect of the transaction  

of property.  Presumption under Section 118 of the Negotiable  

Instruments Act was available.  The appellant had failed to enter  

appearance without any justification in spite of service,  there  

was no ground to set aside the ex parte decree.   

8. We have heard learned counsel for the parties.

9. Learned counsel for the appellant categorically stated that  

the appellant was not in possession of the plot in question and  

no such plot existed.  The plaintiff-respondent was at liberty to  

take over the same to which the appellant had no objection.  He  

submitted  that  the  transaction  in  question  was  without  any  

consideration.  He also submitted that though the wife of the  

appellant received the summons which were handed over to the  

counsel,  for  want  of  ignorance,  the appearance could not  be  

filed.  Thus, even if the appellant is not granted unconditional  

leave  to  defend,  such  leave  could  be  given  subject  to

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reasonable conditions.  If leave to appeal is not granted, there  

will be perpetuation of injustice to the appellant by making him  

to  suffer  the  decree  in  respect  of  a  transaction  without  any  

consideration.

10. Learned counsel for the respondent supported the finding  

recorded by the courts below.

11. After  due  consideration,  we  are  of  the  view  that  a  

debatable issue does arise for consideration and it will be fair  

and just to give the appellant an opportunity to contest the suit  

subject to the appellant depositing the entire amount claimed in  

the  suit  but  without  interest  or  costs,  i.e.  Rs.3  lacs.   In  

pursuance of interim order dated 8th March, 2013, the appellant  

claims to have deposited 50% of the decretal amount before the  

trial Court.  On depositing the rest of the amount to make up the  

deficit of Rs.3 lacs within six weeks from today, the decree will  

stand set aside and the appellant will  be entitled to leave to  

defend.   The  deposit  will  abide  by  further  order  of  the  trial  

Court.

12. We are conscious of the fact that setting aside of ex-parte  

decree under Order XXXVII Rule 4 of the Code cannot be allowed  

in  routine  and  special  circumstances  are  required  to  be  

established.  However, the expression “special circumstances”  

has  to  be  construed  having  regard  to  the  individual  fact  

situations.   The  Court  has  to  balance  the  equities  and  while

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safeguarding the interest of the plaintiff, appropriate conditions  

can be laid down if the defendant makes out a debatable case  

which may prime facie show injustice if the ex-parte decree was  

not set aside.  As already observed, in the present case, it will  

be in the interests of justice that the ex-parte decree is set aside  

but the interest of the plaintiff is safeguarded by the deposit of  

the  amount  in  question  by  the  defendant  as  a  condition  

precedent for setting aside the decree.

13. Accordingly, the appeal is allowed in the above terms.  It is  

made clear  that  we have not  expressed any final  opinion on  

merits  and the trial  Court will  be free to take decision in the  

matter without being bound by the observations made in this  

order which are only for deciding this appeal.   

…………………………………J.                 (T.S. THAKUR)

………………………………………J.                         (ADARSH KUMAR GOEL)

NEW DELHI JANUARY 15, 2015

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ITEM No. 1A             Court No. 2                SECTION  (For Judgment)                  

S U P R E M E   C O U R T   O F   I N D I A                           RECORD OF PROCEEDINGS       Civil Appeal  No(s).... of 2015 @ SLP(C) No. 11191 of 2013   

MAHESH KUMAR JOSHI                             Appellant(s)

                               VERSUS

MADAN SINGH NEGI                    Respondent(s)

 Date : 15.01.2015   This appeal was called on for judgment today.

For Appellant(s) Mr. Rajeev Sharma, Adv.

                        For Respondent(s) Ms. Anjani Aiyagari, Adv.

         UPON hearing the counsel the Court made the following                              O R D E R

Hon'ble  Mr.  Justice  Adarsh  Kumar  Goel  

pronounced Judgment of the Bench comprising Hon'ble  

Mr. Justice T.S.Thakur and His Lordship.

Leave granted  

The appeal is allowed in terms of the signed  

non-reportable judgment.

(Shashi Sareen) Court Master

(Veena Khera) Court Master  

(Signed Non­Reportable judgment is placed on the file)