Final Order 1

Order Details: Notice of Motion
Pdf Text: (Disposed) Suit No.5102/2007 1 Order in N/M No. 4033 of 2019
MHCC010111102019
IN THE BOMBAY CITY CIVIL COURT AT MUMBAI
NOTICE OF MOTION NO. 4033 OF 2019.
IN
Suit No.5102 of 2007.
(High Court Suit No. 1562 of 2007)
4. Mrs. Harsha Jitendra Malkan and Anr. … Applicants/
(Defendant No.4 & 5)
In the matter between
Housing Development Finance
Corporation Limited. …Plaintiff
V/s.
Mr. Mayur Ratanshi Sampat & Ors. ...Defendants.
Appearance:
Adv. Mr.Shireesh Oak a/w Madhukar Jadhav i/b SC Legal for
Plaintiff/DH.
Adv. Mr. Mehul Shah for Defendant Nos. 4 & 5/JD.
CORAM : H. H. JUDGE AND
ASST SESSIONS JUDGE,
SHRI. S. B. PAWAR (C.R.No.59)
DATE : 08th JULY, 2022
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(Disposed) Suit No.5102/2007 2 Order in N/M No. 4033 of 2019
ORDER
Applicants/Defendant Nos. 4 & 5 have taken out this Notice
of Motion with a prayer to set aside exparte decree dated 07.09.2017
passed in suit No. 5102/2007.
2. It is the contention of the applicants that they are served
with warrant of attachment in Execution Application No.117 of 2018 on
03.10.2019. Thereafter, their advocate informed that decree in the
above suit is passed on 07.09.2017. Applicants were not served with
Writ of Summons. The applicants have purchased flat No.702, 7th Floor,
Natasha ManorA, Eksar Village, Borivali on 19.02.1999. At that time,
defendant No.3 never informed that the said flat was sold to defendant
Nos.1 and 2 and that they have procured loan. The plaintiff filed suit for
recovery of the loan and for declaration that suit flats are validly
mortgaged. After service of Chamber Summons No. 1766 of 2006,
applicants contacted defendant No.3 who assured that he will take care
and applicants need not have to worry. Applicants had also appointed
advocate to represent them in the said Chamber Summons and
advocate had assured that he will look after the matter. However, on
03.10.2019 the applicants were served with warrant of attachment of
the above flat. After contacting another advocate, it was revealed that
exparte decree was passed against the applicants. The suit is barred
under the law. The decree is passed by the Court without jurisdiction.
Thus, it is nullity. Ultimately it is prayed that the exparte decree dated
07.09.2017 be set aside.
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(Disposed) Suit No.5102/2007 3 Order in N/M No. 4033 of 2019
3. Plaintiff, by filing affidavitinreply, contested the Notice of
Motion on the grounds that it is false, frivolous, vexatious and badin
law. The applicants have suppressed material facts. It is filed only with
a view to delay execution proceeding. There is no prayer of condonation
of delay. Applicants are not bonafide purchasers. Applicants have
played fraud upon the Court by making false statement that they were
never served with the Writ of Summons. Service affidavit shows that
applicants were served with Writ of Summons. They were very well
aware of the suit filed by the plaintiff and they negligently relied upon
defendant No.3. Rest of the averments in the reply affidavit are in the
form of denial, ultimately praying for dismissal of the Notice of Motion.
4. Following points arise for my determination to which I
record my findings for the reasons to follow:
Sr.No. FINDINGS REASONS
1. Whether order dated
07.09.2017 in disposed of Suit
No.5102 of 2007 is liable to be
set aside and the suit deserves
to be restored on the files?
No
2. What order? Notice of Motion
is dismissed.
REASONS
As to Point No. 1 & 2:
5. Heard Ld. Adv Mehul Shah for applicants and Ld. Adv
Shireesh Oak for the plaintiff. Ld. Advocate for the applicants submits
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(Disposed) Suit No.5102/2007 4 Order in N/M No. 4033 of 2019
that the decree is nullity as it is passed by the Court having no
jurisdiction to try and entertain the suit. He submitted that the issue of
nullity can be considered by this Court in the present proceedings as
well, this being collateral proceeding. As per his submissions, the suit
was filed by the plaintiff for recovery of an amount exceeding
Rs.10,00,000/. Therefore, jurisdiction of Civil Court is barred under the
Recovery of Debts Due to Banks and Financial Institutions Act and
consequently the decree is nullity. He further submits that writ of
summons was not served upon the applicants and this Notice of Motion
is filed within the period of limitation from the date of knowledge of the
decree. Therefore, it may be allowed. In support of his submissions, he
relied upon following judgments:
i) Sushil Kumar Sabharwal V/s. Gurpreet Singh And
Others., (2002) 5 SCC 377;
ii) Raj Kishor Pandey V/s. State of Uttar Pradesh and
Other., (2009) 2 SCC 692;
iii) G.P. Srivastav V/s. R.K. Raizada and Others.,(2000) 3
SCC 54; and
iv) Gauhati University V/s. Niharlal Bhattachariee.,
(1995) 6 SCC 731.
6. Per contra, Ld. Advocate for the plaintiff submits that the
case of the plaintiff is not governed under RDDB Act. Plaintiff is not a
Public Financial Institution. Therefore, provisions of RDDB Act are not
applicable to the claims raised by the plaintiff. As per his submission,
Section 2(h) of RDDB Act which defines ‘Financial Institution’ includes
only Public Financial Institutions whereas the plaintiff is a Private
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(Disposed) Suit No.5102/2007 5 Order in N/M No. 4033 of 2019
Financial Institution. He further submits that writ of summons was duly
served upon the applicants. There is no prayer for delay condonation
and therefore, the Notice of Motion is liable to be dismissed. He relied
upon the following authorities in support of his submissions.
i) Sneh Gupta V/s. Devi Sarup & Ors., 2009 DGLS
(SC) 247;
ii) Mahabir Singh V/s. Subhash & Ors., 2007 DGLS
(SC) 1180;
iii) Vijay Prabhakar Salunke V/s. Kamini S. Dadakar,
2001 (Supp.) Bom.C.R.810,
iv) Kanta alias Shanti w/o Subhash Karkale V/s.
Manjulabai alias Kholki w/o. Haribhau Tarare
and anr., Civil Application No.19/2018 in Second
Appeal St. No. 22803/2017, Hon'ble High Court
of Nagpur Bench;
v) Abdul Hammed Abdul Gani Shaikh V/s. Amjad
Ali Shafi Khan.,2018 DGLS (Bom.) 1340.
7. The first ground contended by the applicants to set aside
the exparte decree dated 07.09.2017 is that the decree is a nullity and
by placing reliance upon the judgment of the Hon’ble Supreme Court in
Urban Improvement Trust, Jodhpur Vs. Gokul Narain (dead) by LRs
and anr, (1996) 4 SCC 178, Ld. Advocate for the applicants submitted
that on this ground the decree can be set aside. In the above authority,
the Hon’ble Apex Court held that when a decree is nullity, its invalidity
can be set up whenever it is sought to be enforced or is acted upon as a
foundation for a right even at the stage of execution or collateral
proceedings. Ld. Advocate for the applicants submits that this
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proceeding is a collateral proceeding.
8. Even if the above ground is considered on merit, it cannot
be prima facie said that the decree is nullity. It is contended that as the
amount to be recovered by the plaintiff was more than Rs.10,00,000/
only DRT had jurisdiction for the recovery proceedings and in terms of
Section 18 of the RDDB Act, jurisdiction of the Civil Court is expressly
barred to entertain the civil suit for the said recovery. Perusal of
definition of ‘financial institution’ in Section 2(h)of the act, makes it
clear that it includes ‘public financial institutions' within the meaning of
Section 4A of the Companies Act, 1956’. The case of the plaintiff is not
governed by the provisions of the above act as the plaintiff is not shown
to be a public financial institution.
9. On the issue of jurisdiction, Ld Advocate for the applicants
placed reliance upon judgments in Allahabad Bank Vs. Canara Bank
and anr, (2000) 4 SCC 406, TJSB Sahakari Bank Ltd. Vs. Global
Trust Bank Ltd., 2018 SCC Online Bom 21175, Sanjay Santosh
Kapoor Vs. Union Bank of India and ors, 2020 SCC Bom 1145 and
Bank of Baroda, through its Branch Manager Vs. Gopal Shriram
Panda and anr, 2021 SCC Online Bom 466. I have gone through all
the above authorities. In all these authorities, proposition is laid down
that in case of recovery by Banks and financial institutions, under
Section 17 of the RDDB Act, DRT has exclusive jurisdiction and under
Section 18 of the said Act, jurisdiction of civil Court is barred. However,
in the case at hand, as it is seen that plaintiff is not a financial
institution within the meaning of RDDB Act, with due respect, the
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above authorities are not helpful to the applicants to establish that the
decree in question is a nullity.
10. Though it can be noted from the judgement that the Court,
while decreeing the suit, upheld the jurisdiction of civil Court by
observing that the recovery amount is less than Rs.10,00,000/ which
prima facie appears to be erroneous in view of the fact that the recovery
claim inclusive of interest was more than Rs.10,00,000/, as the
provisions of RDDB Act are not applicable to the plaintiff, there does
not appear any bar to the jurisdiction of the civil Court to try and
entertain the suit. Therefore, the contention of the applicants in that
regard is not acceptable.
11. In the light of reliefs sought in the Notice of Motion, Court
is necessarily required to see if applicants satisfy the requirement under
Rule 13 of Order 9 of CPC. Under Rule 13, exparte decree can be set
aside only if the defendant satisfies the Court that the summons was not
duly served or that he was prevented by any other sufficient reasons
from appearing when the suit was called on for hearing. Second proviso
in Rule 13 further clarifies that exparte decree cannot be set aside
merely on the ground that there has been an irregularity in the service
of summons, if it is satisfied that defendant had notice of hearing and
had sufficient time to appear and answer plaintiff's claim.
12. Applicants have contended that they were not served with
the Writ of Summons. In affidavit in rejoinder applicants have taken a
stand that signatures on the acknowledgement cards attached to the
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affidavit of service in the suit though seem to be that of applicant No.1,
but the applicants have received only the Chamber Summons and
Affidavit in support of the Chamber Summons.
13. Plaintiff along with affidavit in reply has annexed copies of
A.D. cards along with affidavit of the bailiff to the effect that registered
A.D. cards are duly acknowledged by defendant Nos. 4 & 5 i.e.
applicants. It is pertinent to note that the applicants have not denied
the signatures on the acknowledgment cards. The record of the suit
indicates that at the relevant time, no Chamber Summons was pending
in the Suit. Therefore, the case of the applicants that they had received
the copy of Chamber Summons and affidavit in the context of the
acknowledgments bearing their signatures, is not acceptable.
14. It has also come on record that applicants had appeared in
the Chamber Summons proceedings. Therefore, it can be said that they
had knowledge of the pendency of the suit. Service affidavit on the
record indicates that writ of summons was duly served upon the
applicants. Moreover, they had sufficient time to appear and to contest
the suit claim. Their contentions that defendant No.3 and their earlier
advocate had assured them that they will take care and therefore, they
were not aware of the decree passed in the suit is also not acceptable as
a sufficient cause for their nonappearance in the suit and to set aside
the exparte decree.
15. In Sushil Kumar Sabharwal V/s. Gurpreet Singh And
Others., (Supra), the defendant had refused the summons and process
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server had failed to affix its copy on the wall of the premises. In these
circumstances, it was held that the service was not proper. In the
present case, service affidavit in the suit clearly demonstrates that
applicants were served with writ of summons by RPAD. Thus, with due
respect, the above authority is not helpful to the applicants. The
authority in Raj Kishor Pandey V/s. State of Uttar Pradesh and
Other., (Supra) is on Order 9 Rule 8 and 9(1).
16. The authority in G.P. Srivastav V/s. R.K. Raizada and
Others (Supra), relied upon by applicants, deals with ‘sufficient' cause,
for nonappearance on the day of hearing. In the present case, it is not
the case of applicants that they could not appear on the day of hearing
owing to any cause. They have come with the case of nonservice of writ
of summons. In Gauhati University V/s. Niharlal Bhattachariee
(Supra) it is held by the Hon’ble Apex Court that when summons is not
duly served, the limitation for filing application for setting aside ex
parte decree will run from the date of knowledge of the decree. In order
to make the ratio applicable, applicants are required to establish that
the summons was not duly served, which they have failed to establish.
17. So far as the authorities relied upon by the plaintiff are
concerned, in Sneh Gupta V/s. Devi Sarup & Ors., (Supra) it is held
that in absence of application for condonation of delay, Court has no
jurisdiction in terms of Section 3 of the Limitation Act to entertain
application for setting aside decree. The decree in question was a
consent decree. In Mahabir Singh V/s. Subhash & Ors., 2007 DGLS
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(Supra), which dealt with application under Order 9 Rule 13 of CPC,
the Hon’ble Apex Court made the similar observations with reference to
Section 3 of the Limitation Act. The authority in Vijay Prabhakar
Salunke V/s. Kamini S. Dadakar, (Supra) is also on the issue of delay
and it is held therein that in absence of application for delay
condonation, application to set aside exparte decree can not be
registered and entertained.
18. In Kanta alias Shanti w/o Subhash Karkale V/s.
Manjulabai alias Kholki w/o. Haribhau Tarare and anr.,(Supra) and
in Abdul Hameed Abdul Gani Shaikh Vs. Amjad Ali Shafi Khan,
2018(3) AIR Bom R 44, the Hon’ble Bombay High Court observed that
party is expected to be diligent and cannot place the blame on
Advocate. In the present case as well, the applicants, for their non
appearance, are trying to rely upon alleged assurance given by their
advocate that he will take care of the matter. Thus, the said contention
of the applicants cannot be accepted. Moreover, so called assurance
given by defendant No.3 to applicants that he will take care of the
matter is not at all relevant.
19. In the above circumstances, no case is made out by the
applicants to set aside the exparte decree dated 07.09.2017 on any of
the grounds contended by the applicants. Resultantly point Nos. 1 and 2
are answered in the negative and following order is passed:
ORDER
1. Notice of Motion No. 4033/2019 is dismissed with costs.
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(Disposed) Suit No.5102/2007 11 Order in N/M No. 4033 of 2019
2. Notice of Motion No. 4033 of 2019 disposed of accordingly.
(SHRI S. B. PAWAR )
Judge
Dt.:08/07/2022 City Civil Court, Gr.Mumbai
Declared on : 08.07.2022
Transcribed on : 11.07.2022
Checked & Signed on :
CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
15.07.2022 at 12.30p.m. Mrs. P.R.Wagh
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
Name of the Judge (with Court
Room No.)
HHJ SHRI.S.B.Pawar,(C.R.No.59)
Judge.,City Civil & Sessions Court,
Date of pronouncement of /Order 08.07.2022
Order signed by P.O. on 12.07.2022
order uploaded on 15.07.2022
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