State Bank of India v. M/S Arizona Printers & Packers Ltd & Ors.

1. By way of present appeal, the appellant seeks setting aside of the order dated 06.06.2015 passed by learned ADJ-II, Central, Tis Hazari Court, Delhi in M. NO. 46 OF 2013 filed in Suit No. 190 of 2006 whereby its application under Order IX Rule 13 read with Section 151 CPC was dismissed. Ancillary prayer seeking directions to the Executing Court to retain/withhold the banker’s cheque for Rs.19,27,693.94 has also been made.

2. Mr. Shiv. K. Tyagi, learned counsel for the appellant submits that alongwith the subject application, the appellant also preferred an application under Section 5 of the Limitation Act seeking condonation of delay of about 4 years in filing the captioned application. It is submitted that though the delay application was allowed but the captioned application under Order IX Rule 13 CPC was dismissed by incorrectly recording that the application has been filed at a belated stage despite being aware of the proceedings. Learned counsel for the appellant submits that the appellant made out a good case for sufficient cause for its non-appearance before the Trial Court.

3. Before proceeding further, it is noted that in the present appeal, while respondent Nos. 1 and 2 were served and represented through a counsel however, they did not file any reply. Further, they have remained unrepresented since the last two dates of hearing. Accordingly, they are proceeded ex-parte. Insofar as respondent No. 3 is concerned, it was served through publication and was already proceeded ex-parte vide order dated 19.09.2016.

4. The facts, in a nutshell, are that respondent Nos. 1 and 2 filed a complaint seeking recovery of Rs.19,92,325.33 against respondent No. 3. It was claimed that respondent No. 3 had approached respondent Nos. 1 and 2 for placing an order for supply of 10 lac empty glass bottles. A letter of credit was taken by respondent No. 3 from the present appellant. Though respondent Nos. 1 and 2 honoured the contract by supplying the glass bottles, however the amounts remained outstanding. A suit was initially filed before this Court whereafter on account of change in pecuniary jurisdiction, it was transferred to the District Court. On said transfer, the suit was listed in the district court on 26.02.2004, and on that date notice was issued to the parties and the matter was adjourned for 17.03.2004. On the said date, the appellant was represented through one Mr. Narender Pal, Advocate however, thereafter appellant remained unrepresented resulting in passing of the ex-parte order dated 20.07.2004 as well as passing of ex-parte judgment dated 24.08.2006. As per the appellant’s case, it became aware of the ex-parte proceedings only on 15.09.2008 when a bailiff appointed by the Executing Court visited the appellant’s premises. The appellant immediately appointed one Mr. Shiv K. Tyagi, Advocate who inspected the case records on 18.09.2008 and came to know about the passing of ex-parte proceedings. On 08.10.2008, the captioned application was filed alongwith an application under Section 5 of the Limitation Act seeking condonation of delay of about 4 years. The common grounds alleged in the said applications were that the appellant, after instructing Mr. Narender Pal to appear, was under a bonafide belief that it was regularly represented. It was further averred that Mr. Narender Pal however did not appear after 17.03.2004 as he had sought a Power of Attorney to appear on subsequent dates. The said communication statedly was misplaced. Resultantly, neither any reply was filed nor any Power of Attorney could be given to Mr. Narender Pal. The said averments in the application were coupled with a duly sworn affidavit of Mr. Narender Pal who explained his non-appearance by stating that, in absence of execution of power of attorney in his favour, he was under the impression that some other counsel was appointed by the Bank/appellant to represent it. The Trial Court while noting the aforesaid facts came to the conclusion that the explanation offered by the appellant was justifiable and subject to payment of cost of Rs.5,000/- allowed the application under Section 5 of the Limitation Act. The said order was challenged before this Court by way of CRP 118/2009 wherein a Coordinate Bench of this Court vide order dated 08.03.2010 also noted the aforesaid facts and finding the explanation given for lack of communication between the client and the counsel to be justified, upheld the order though subject to payment of further cost of Rs.5,000/-. The order passed by this Court was challenged by way of SLP 30333/2009 by respondent Nos. 1 and 2 which was dismissed on 30.11.2019. Subsequently, when the matter was listed before the Trial Court, the impugned order came to be passed.

5. As noted above, the grounds urged in the captioned application as well as in the application under Section 5 of the Limitation Act were one and the same. Appellant had explained reasons for its non-appearance before the Trial Court. The application was coupled by the affidavit of Mr. Narender Pal, Advocate, which reads as under:- "I, the aforesaid deponent, do hereby solemnly declare and affirm as under:-

1. That I am on the list of panel lawyers of the State Bank of Patiala. which has been arrayed as the defendant No. 2 in the above case.

2. That, on telephonic instructions from the then Manager (Advances) of the State Bank of Patiala at its Parliament Street, New Delhi, I appeared in the above case on 17-3-2004 by filing a memorandum of appearance.

3. That, thereafter, as usual, 1 sent my report to the above Branch of the defendant No. 2, by ordinary post, along with the Vakalatnama form, requesting for sending me the Vakalatnama and the case file if I had to attend to the above case on the next date of hearing, which was fixed for 21-4-2004.

4. That I did not appear in the above case on the next date of hearing and thereafter as I did not receive any further instructions from the Branch and was under the impression that the case had been assigned to some other panel advocate of the defendant Bank.

5. That it now appears that my above report was misplaced in transit as I received a letter dated 26-9-2008 from the defendant bank informing me that it had come to know that the above suit had been decreed on 24-8-2006 ex-parte since I did not appear on and after 21-4-2004 in the above case. I have already explained to the defendant bank the above facts and the defendant bank has informed me that it has checked its records and my above report did not reach it.

6. That non-appearance of the deponent on behalf of the defendant bank on 21-4-2004 and thereafter was nor deliberate and it was only due to the aforesaid circumstances."

6. Before proceeding further, reference in connection with the scope of present appeal is made to decision of this Court in H. P. Singh (Harvinder Pal Singh) v. Sh. Jasbir Singh & Ors., FAO 64/2022 rendered on 10.03.2023. Relevant paras of the said judgment read as follows:

10. At this stage, reference may profitably be made to Sudarshan Sareen v. National Small Industries Corporation Ltd. and Anr. reported as 2013 SCC OnLine Del 4412, where a Division Bench of this Court held the appellant therein to have been willfully negligent in not appearing and rejected his prayer for setting aside dismissal of his application under Order 9 Rule 13 CPC. The Court relied on a passage from Parimal v. Veena alias Bharti reported as (2011) 3 SCC 545, where the expression “sufficient cause” was interpreted as under: