BOGIDHOLA TEA AND TRADING CO. LTD. AND ANR.versusHIRA LAL SOMANI

         BOGIDHOLA TEA AND TRADING CO. LTD. AND ANR.                       A
                             v.
                      HIRA LAL SOMANI

                            DECEMBER 7, 2007
                                                                           B
                  [S.B. SINHA AND G.S. SINGHVI, JJ.]


          Code of Civil Procedure, I 908-0. 8 r. I 0-Jnvoking of-Suit-
     Non-appearance ofdefendant despite service ofsummons-Prayer for
     decree under 0.8 r. I 0-Plaintiffdeclined to examine any witness-Ex- C
     parte decree-Application for setting aside ex-pa rte decree on the
     ground that suit was barred by limitation-Dismissed by Courts
,•   below-Correctness of-Held: Not correct-It was duty of Court to
     consider if suit was barred by limitation even when no such defence
     raised-Jn case suit barred by limitation, Court had no jurisdiction to D
     pass decree-Even otherwise, plaintiffwas bound to prove his case-
     Trial Court erred in invoking 0.8 r.10-Ex parte decree set aside-
     Limitation Act, 1963-s.3.
           The parties were on business terms. The appellants were to E
     supply 'made tea' for the year 1984 and 1985 to the respondent. They
     supplied lesser quantity of 'made tea' for both years. Respondent
     filed a suit towards the price of the remaining amount for terminal
     tea supply. Despite service of summons, the appellants did not
     appear. The respondent made a prayer before the trial court to pass
     decree under 0.8 r.10 CPC. He declined to examine any witness. F
     The trial court passed ex-parte decree stating that prima facie case
     was made out in favour of the respondent-plaintiff. An application
     was filed for execution of decree in 1997. Summons in the said
     execution case were served upon the appellants. The execution
     proceeding were stayed in July, 2000. In September, 2000, the G
     appellants filed an application under 0.9 r.13, CPC for setting aside
     the said ex-parte decree. The said application was dismissed on the
     ground that the appellants could not satisfactorily explain the cause

                                    1153                                  H
    1154           SUPREME COURT REPORTS                  [2007] 12 S.C.R.

A for delay in filing the said application, as also in view of Article 123
  of the Schedule appended to the Limitation Act, 1923. The revision
  thereagainst was also dismissed. Liberty, however, was granted to
  the appellants to prefer an appeal against the original decree. An
  appeal thereafter was filed by the appellants along with an
B application for condonation of delay. The High Court refused to
  condone the delay and consequently dismissed the appeal.

        In appeal to this Court, the appellants contended that it was
   obligatory on the part of the trial judge to satisfy itself about the bona
  fide of the claim of the plaintiff-respondent and; that having regard
C to the fact that the last advance was purported to have been made
   on 19.6.1985, the suit which was filed on 2.1.1989 was barred by
   limitation.

           Disposing of the appeal, the Court
D          HELD: 1. Ordinarily, this Court would not interfere in 8UCh a
     matter. However, it appears to be a gross case. Appellants had shown
     that the ex-parte decree ex1acie suffers from non-application of mind.
     Had the Judge applied its mind even to the averments made in the
     plaint, he should have asked himself the question as to whether in
E    absence of any acknowledgment in writing, as a result whereof the
     period oflimitation would start running afresh, the suit could have
     been decreed. S.3 of the Limitation Act, 1963 mandates that a Court
     would not exercise its jurisdiction for any reliefin favour of a party
     if the same is found to be barred by limitation. Although such a
F    defence was not raised, the statute obligated upon the Court oflaw
     to consider as to whether a suit is barred by limitation or not. In the
    event it was found that the suit was barred by limitation, the Court
    had no jurisdiction to pass a decree. It was, therefore, essential for
    the trial judge to pose unto itself the right question, particularly when
G   without adduction of oral evidence the pleading raised in the plaint
    could not be said to have been established. It was, therefore, not a
    case where the Court could have invoked the provisions of0.8 r.10
    CPC. Even otherwise, the suit was set down for ex-parte hearing.
    The trial judge stated that only a prima1acie case was found out from
H   the plaint and other documents which were not sufficient for passing
     BOGIDHOLA TEAANDTRADINGCO.LTD. v. HIRALAL 1155
                  SOMANI [SINHA, J.]
    a decree as therefor the plaintiff was bound to prove his case.     A
                                    [Para 11] [1158-F, G; 1159-A, B, CJ
         2. Having regard to the peculiar facts and circumstances of this
    case, it is a fit case where the High Court should have condoned the
    delay. In the interest of justice, the ex-parte decree is set aside. This B
    order shall, however, be subject to the condition of deposit of a sum
    ofRs.1 lakh by the appellant before the Executing Court and a sum
    of Rs. 25,000/- to the respondent towards costs.
                                          [Paras 12 and 13] [1159-C, D, E)
        CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5771 of C
    2007.
        From the final Judgment and Order dated 3.1.2007 of the Gauhati
    High Court ~n MC No. 3398 of2004 in RFA No. 122 of2004.
         Vijay Hansaria, Sneha Kalita and Shankar Divate for the Appellants. D
        Manish Goswami, Ashok Panigrahi (for Mis. Map & Co.) for the
    Respondent.
         The Judgment of the Court was delivered by
                                                                             E
         S.B. SINHA, 1. 1. Leave granted.
         2. This appeal is directed against the judgment and order dated
    3.1.2007 passed by the Gauhati High Court in MC No. 3398/2004
    whereby and whereunder the appeal preferred by the appellants herein
    from a judgment and decree dated 19.4.1990 passed in Suit No. 2189, F
    was dismissed on the premise that the appellants had not shown sufficient
    cause for condonation of 10 months' delay in filing the said appeal.
         3. The parties herein were on business terms. Appellants were to
    supply 22,000 Kgs. of 'made tea' for 1984 season and 50,000 Kgs. of G
    'made tea' for 1985 season to the respondent. However, the appellants
1   supplied only 5,547 Kgs. of 'made tea' for 1984 season and 18.245 Kgs.
    of 'made tea' for 1985 season. Respondent filed a suit for a decree for
    a sum of Rs. 5,22,69.66 paise together with interest thereon at the rate
    of 18% per annum. A suit was filed towards the price of the remaining H
    1156           SUPREME COURT REPORTS                    (2007] 12 S.C.R.


A amount for terminal tea supply. In paragraphs 5 of the plaint, the
                                                                                   -
  respondent inter alia averred:
           'The price for other remaining quantity of made tea of 1985 season
           made available by the defendants to the plaintiff, could not be
           finalized as the same were found to have no proper market and
B          hence were not saleable at Jorhat. At such as per instruction/
           discussion of the defendants, remaining qualities of 14,796 of made
           tea of 1985 season were sent to the tea action market at Guwahati
           and in Calcutta. The sale proceeds of the said tea on sale of auction
           markets were to be adjusted with the advances already made by
c          the plaintiff to the deponents. After 18.04.85 the plaintiffhad paid
           a total sum of Rs. 6,22,116 inclusive of Rs. 1,30,000 as shown in
           schedule 'A' below."
           The first Bill referred to in this appeal reads thus:
D          "Bill dated 5.6.85 for ...... .     Rs. 46,595.80
           Bill dated 5.6.85 for ....... ..    Rs. 86,225.00
           For sale proceeds on 16.8.85        Rs. 79, 824.91
E          For sale proceeds on 26.8.85        Rs. 4,608.60
           For sale proceeds on 9.9.85         Rs. 9,101.83
           For sale proceeds on 19.9.85        Rs. 3766.70
           For sale proceeds on 12.11.85 Rs. 2502.54
F
           For sale proceeds on 9.12.85        Rs. 30, 615.48
           For sale proceeds on 23.12.85 Rs. 30, 9119.62
           For sale proceeds on 3.1.86        Rs. 5,945.78
G
           For sale proceeds on 20.1.86        Rs. 9,784.28
                                               Rs. 3,18,089.54
       4. Allegedly, despite service of summons the appellants did not
H appear. The plaintift:respondent made a prayer before the Trial Court that
     BOGIDHOLA TEA AND TRADING CO. LTD. v. HIRALAL 1157
                  SOMANI [SINHA, J.]
    a decree be passed under Order 8 Rule 10 of the CPC. He declined to A
    examine any witness. The learned Trial Court by a judgment and order
    dated 19 .4.1990 decreed the suit stating:
               "Learned lawyer of the plaintiff side is present filing his hazira.
           Defendants side is absent without any step. Seen the previous B
           orders of this Court. The suit is taken up for ex-parte hearing.
           Heard learned counsel for the plaintiff. He submits Court to take
           action under Order VIII Rule 10 of the C.P.C. and declined to
           examine any P.W. Hence, perused the plaint and the relevant
           documents submitted by the plaintiff in support of his plaint. Prima
           facie case is held proved in favour of the plaintiff as per plaint. C
               The suit is decreed on ex-parte for realization of Rs.
           5,22,669.66 p with costs of the suit and future interest per plaint
           as prayed for."
          5. Appellants contended that they were not aware of passing of the D
    said decree. In the year 1997, an execution case was filed. Summons in
    the said execution case were served upon the appellants. One Shri Tapan
    Gogoi was appointed as an Advocate in the said execution case.
    However, no further steps were taken. The execution proceeding was
    stayed on 15.7.2000.                                                     E
          6. In the month of September, 2000, the appellants herein filed an
    application under Order 9 Rule 13 of CPC for setting aside the said ex-
    parte decree. An application for condonation of delay in filing the suit
    was also filed. The said application was dismissed by an order dated F
    22.9.2003 as the appellants could not allegedly satisfactorily explain the
    cause for delay in filing the said application as also in view of Article 123
    of the Schedule appended to the Limitation Act, 1923.
          7. A civil revision application was preferred thereagainst which was
    also dismissed by the High Court by its order dated 2.1.2004. Liberty, G
    however was granted to the appellants to prefer an appeal against the
I
    original decree. An appeal thereafter was filed by the appellants along
    with an application for condonation of delay. The High Court by reason
    of the impugned judgment refused to condone the delay and consequently
                                                                                 H
                                                                                   (



     1158           SUPREME COURT REPORTS                   [2007] 12 S.C.R.


A dismissed the appeal.
         8. Mr. Hansaria, learned Senior counsel appearing on behalf of the
  appellants, inter alia, would submit that the High Court committed a
  serious error in passing the impugned judgment in so far as it failed to
  take into consideration that assuming that the defendant-appellants had
B not filed written statement, it was obligatory on the part of the Trial Judge
  to satisy itself about the bona fide of the claim of the plaintiff-respondent.
  Learned counsel urged that having regard to the fact that the last advance
  was purported to have been made on 19.6.1985, the suit which was filed
  on 2.1.1989 was barred by limitation.
c
        9. Learned counsel appearing on behalf of the respondent, on the
  other hand, submitted that assuming that the learned Trial Judge should
  not have granted a decree in terms of Order 8 Rule 10 of the CPC. the
  appellants were obligated to explain the delay in preferring an appeal. The
D appeal being continuation of the suit, the learned counsel would submit
  that ifthe same could not have been entertained on the ground of being
  barred by limitation, the question of setting aside the decree by the High
  Court in exercise of its appellate jurisdiction did not and could arise.
       10. While issuing notice in terms of orders dated 16.04.2007, this
E Court directed the appellants to deposit a sum of Rs. 2 lakhs before the
  Executing Court within four weeks from the said date. It is stated before
  us by learned senior counsel Mr. Hansaria, that the aforementioned sum
  has been deposited on or about 25.6.2007.
F       11. Ordinarily, we would not have interfered in such matter. However,
  it appears to be a gross case. Appellants before us have been able to
  show that the ex-parte decree dated 19.4.1990 passed by the learned
  Additional District & Sessions Judge, Jorhat, ex1acie suffers from non-
  application of mind. Had the learned Judge applied its mind even to the
  averments made in the plaint, he should have asked himself the question
0
  as to whether in absence of any acknowledgment in writting, as a result
  whereof the period of limitation would start running afresh, the suit could
                                                                                       \
  have been decreed. Section 3 of the Limitation Act, 1963 mandates that
  a Court would not exercise its jurisdiction for any relief in favour of a
H party if the same is found to barred by limitation. Although such a detence
     BOGIDHOLA TEAANDTRADINGCO.LTD. v. HIRALAL 1159
                  SOMANI [SINHA,J.]
    has not been raised, the statute obligated upon the Court of law to A
    consider as to whether a suit is barred by limitation or not. In the event it
    was found that the suit was barred by limitation, the Court had no
    jurisdiction to pass a decree. It was, therefore, essential for the learned
    Trial Judge to pose unto itself the right question, particularly when without
    adduction of oral evidence the pleading raised in the plaint could not be B
    said to have been estalished. It was, therefore, not a case where the Court
    could have invoked the provisions of Order 8 Rule 10 of the CPC. Even
    otherwise, the suit was set down for ex-parte hearing. The learned Trial
    Judge stated that only a prima-facie case was found out from the plaint
    and other documents which were not sufficient for passing a decree as c
    therefor the plaintiff was bound to prove his case.
          12. For the reasons aforementioned, having regard to the peculiar
    facts and circumstances of this case, we think that it is a fit case where
    the High Court should have condoned the delay. We, therefore, set aside
    the judgment of the High Court. Ordinarily, we would have remitted the D
    matter back to the High Court for consideration thereof on merit of the
    appeal, but as we have ourselves looked to the records of the case, we
    are of the opinion that interest of justice would be subserved if we set
    aside the ex-parte decree dated 19.4.1990. We direct accordingly.
                                                                                  E
          13. This order shall, however, be subjeCt to the condition that the
    appellants shall deposit a further sum of Rs. l lakh before the Executing
    Court which shall be subject to the outcome of the suit. Appellants shall
    further pay a sum of Rs. 25,000/- to the respondent towards costs. The
    respondent shall be entitled to withdraw the sum deposited by the F
    appellants, upon furnishing security.
          14. Appellants may file written statements before the Trial Corut within
    six weeks and the learned Trial Judge may consider the desirability of
    disposing of the suit within three months from the date ofreceipt of this
    order.                                                                         G

         15. The appeal is disposed of with the aforementioned observations
/
    and direction.
    D.G.                                                 Appeal disposed of.
                                                                                 H