M/S NEERJA REALTORS PVT LTDversusJANGLU (DEAD) THR. LR.

                         [2018] 1 S.C.R. 359                               359


                M/S NEERJA REALTORS PVT LTD                                A
                                   v.
                     JANGLU (DEAD) THR. LR.
                    (Civil Appeal No. 71 of 2018)
                       JANUARY 29, 2018                                    B
      [DIPAK MISRA, CJI, A. M. KHANWILKAR AND
              DR. D. Y. CHANDRACHUD, JJ.]
      Code of Civil Procedure, 1908:
       Or. V, rr. 17 and 20 – Application for susbstituted service –
                                                                           C
Allowed – Subsequent to substitued service by publicatin, ex-parte
decree – Appeal under s.96 CPC – Allowed by High Court – On
appeal, held: In the present case there was a breach of the provisions
of Or. V, r.17 – Substituted service is an exception to the normal
mode of service – Or. V, r. 20 requires the Court to be satisfied
either that there is reason to believe that the defendant is keeping       D
out of the way for the purpose of avoiding service or that for any
other reason, the summons cannot be served in the ordinary way –
Trial court failed to apply its mind to the requirements of Or. V, r. 20
and passed a mechanical order – Trial court also ignored the
provisions contained in Chapter 3 of Civil Manual – Civil Manual
                                                                           E
issued by High Court of Bombay – Chapter III – Paragraphs 33 to
36.
      Decree:
      Ex-parte decree – Remedy against – Held: Remedy against
ex-parte decree is either an appeal u/s 96 CPC or an application u/        F
Or. IX, r. 13 CPC or both the proceedings simultaneously – Right of
appeal is not taken away by filing application u/Or. IX, r.13 – But if
appeal is dismissed, application u/Or. IX, r.13 is not maintainable –
When application u/Or. IX r.13 is dismissed, remedy lies u/Or. XLIII,
r.1 – However once appeal u/Or.XLIII, r.1 is dismissed same
contention cannot be raised in appeal u/s. 96 – Code of Civil              G
Procedure, 1908 – s.96, Or.IX, r.13 and Or. XLIII, r.1.
      Dismising the appeal, the Court
      HELD: 1.1 The record before the Court would indicate that
the Trial Court by its order dated 9 February 2011 directed the            H
                              359
360           SUPREME COURT REPORTS                      [2018] 1 S.C.R.


A     issuance of summons to the original defendant, returnable on 15
      March 2011. In pursuance of the order, summons were issued
      on 4 March 2011. The report of the bailiff dated 11 April 2011
      indicates that the summons were returned unserved and the bailiff
      was informed that the original defendant had left the premises
      nearly two years earlier and resided elsewhere. The report of
B
      the bailiff does not indicate that the summons were affixed on a
      conspicuous part of the house, at the address mentioned in the
      summons. There was a breach of the provisions of Order V Rule
      17 CPC. When the application for substituted service was filed
      before the Trial Court under Order V Rule 20 CPC, a cryptic
C     order was passed on 2 September 2011. Order V Rule 20 requires
      the Court to be satisfied either that there is reason to believe
      that the defendant is keeping out of the way for the purpose of
      avoiding service or that for any other reason, the summons cannot
      be served in the ordinary way. Substituted service is an exception
      to the normal mode of service. The Court must apply its mind to
D
      the requirements of Order V Rule 20 and its order must indicate
      due consideration of the provisions contained in it. Evidently the
      Trial Court failed to apply its mind to the requirements of Order
      V Rule 20 and passed a mechanical order. Besides this, the Trial
      Judge ignored the provisions contained in Chapter III of the Civil
E     Manual issued by the High Court on its appellate side for the
      guidance of civil courts and officers subordinate to it. [Paras
      14,15][364-D; 365-A-D]
            1.2 There was a clear breach of the procedure prescribed
      in Order V Rule 17 even antecedent thereto. Besides, the order
F     of the Court does not indicate due application of mind to the
      requirement of the satisfaction prescribed in the provision. The
      High Court was, in these circumstances, justified in coming to
      the conclusion that the ex-parte judgment and order in the suit
      for specific performance was liable to be set aside. [Para 15][366-
      D-E]
G
             2. A defendant against whom an ex-parte decree is passed
      has two options: The first is to file an appeal. The second is to
      file an application under Order IX Rule 13 CPC. The defendant
      can take recourse to both the proceedings simultaneously. The
      right of appeal is not taken away by filing an application under
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 M/S NEERJA REALTORS PVT LTD v. JANGLU (DEAD) THR.                          361
                       LR.

Order IX Rule 13. But if the appeal is dismissed as a result of             A
which the ex-parte decree merges with the order of the Appellate
Court, a petition under Order IX Rule 13 would not be
maintainable. When an application under Order IX Rule 13 is
dismissed, the remedy of the defendant is under Order XLIII
Rule 1. However, once such an appeal is dismissed, the same
                                                                            B
contention cannot be raised in a first appeal under Section 96.
[Para 16][366-G-H; 367-B]
        Bhanu Kumar Jain v Archana Kumar [2004] 6 Suppl.
        SCR 1104 : (2005) 1 SCC 787; Rabindra Singh v
        Financial Commissioner, Cooperation, Punjab [2008]
        8 SCR 813 : (2008) 7 SCC 663; Mahesh Yadav v                        C
        Rajeshwar Singh [2008] 17 SCR 726 : (2009) 2
        SCC 205 – relied on.
                         Case Law Reference
        [2004] 6 Suppl. SCR 1104           relied on       Para 16
                                                                            D
        [2008] 8 SCR 813                   relied on       Para 16
        [2008] 17 SCR 726                  relied on       Para 16
        CIVIL APPELLATE JURISDICTION: Civil Appeal No. 71 of
2018.
      From the Judgment and Order dated 07.07.2015 of the High Court        E
of Judicature at Bombay at Nagpur in FA No. 928 of 2014.
      Kumar Shashank, Ms. Rukhmini Bobde, Vishal Prasad, Advs. for
the Appellant.
        The Judgment of the Court was delivered by
                                                                            F
        DR. D. Y. CHANDRACHUD, J. 1. Delay condoned.
       2. The present appeal is from the judgment of a Single Judge at
the Nagpur Bench of the High Court of Judicature at Bombay. While
allowing a first appeal, the High Court set aside the judgment andorder
of the Civil Judge (SeniorDivision) at Nagpur which had decreed a suit
for specific performance instituted by the appellant, ex-parte.             G
      3. The subject matter of the suit for specific performance is an
agreement dated 15 July 2006 entered into by the appellant with the
original defendant in respect of agricultural land admeasuring 1.66
Hectares (4.07 acres) situated in Mauza-Sondapar, Tahsil Hingna, District
Nagpur. The total consideration payable under the agreement was             H
362             SUPREME COURT REPORTS                            [2018] 1 S.C.R.


A     Rs 13,04,391 out of which an amount of Rs 3,26,000 was recorded to
      have been paid. The balance of Rs 9,78,391 was to be paid at the time
      of the execution of the sale deed.
             4. On 30 June 2007,Shobha, who is the daughter of the original
      respondent instituted a suit (Old Regular Suit No 726/2007 which was
B     renumbered as Regular Suit No 269/2008) against her father and the
      appellant for partition, possession and for declaratory and injunctive reliefs
      in relation to the land. In that suit the plaintiff claimed that her father
      was in dire financial need and had obtained a loan from the appellant
      and that as security,the appellant got certain documents executed.
      According to the plaintiff, the agreement was vitiated by fraud and
C     misrepresentation and the land being ancestral property, the agreement
      was not binding on her. The original defendant entered appearance and
      disclosed his residential address in a proceeding under Order VIII Rule
      11 of the Code of Civil Procedure, 1908 (‘the CPC’). The appellantalso
      filed her written statement. The suit was dismissed on 8 July 2010 on the
D     ground that the land belonged to the original defendant and that the plaintiff
      had no right, title and interest.
             5. On 5 February 2011, the appellant filed a suit for specific
      performance (Suit 184 of 2011) of the agreement to sell dated 15 July
      2006. On 9 February 2011, the Trial Court issued notice to the original
E     defendant for settlement of issues. It appears that summons were issued
      on two occasions to the original defendant but were returned unserved.
      On 11 April 2011, the bailiff submitted a report stating that when he went
      to serve the defendant, he was informed by persons residing in the village
      that he had left the premises two years earlier and was residing
      elsewhere. The summons were returned since the defendant was not
F     residing at the address given therein.
             6. The appellant filed an application for substituted service under
      Order V Rule 20 (1-A) of the CPC on 2 September 2011. The Trial
      Court allowed the application on the same day in terms of the following
      order:
G
             “Issue S/S to deft. u/o 5 R 29 (1-A) of CPC at the expense of the
             Plaintiff.”
             7. The appellant claims to have effected substituted service by
      publication in the Marathi daily Lokmat. On 29 November 2011, the
      Trial Court passed the following order:
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 M/S NEERJA REALTORS PVT LTD v. JANGLU (DEAD) THR.                            363
           LR. [DR. D. Y. CHANDRACHUD, J.]

        “Deft. served on public notice in daily news paperLokmat on           A
        04.10.2011 but he remained absent. Suit proceeded ex parte against
        the defendant. Suit proceeded ex parte against the Deft.”
       8. The suit was decreed on 13 June 2014 and the appellant was
directed to deposit the balance consideration of Rs 9,78,391 within one
month.                                                                        B
        9. The appellant claims to have deposited the amount on 17 July
2014.
       10. On 12 September 2014, the original defendant filed a first
appeal under Section 96 of the CPC before the High Court. He died on
21 August 2015. The appellant submitted an application for bringing           C
hislegal representatives on record. The application was eventually allowed
on 23 September 2016.
        11. The High Court by its judgment dated 7 July 2015 held that
neither the report of the bailiff nor the order of the Trial Court indicate
that a copy of the summons was affixed in a conspicuous place on the          D
court house and at the house where the defendant was known to have
last resided. The High Court held that there was a breach of the provisions
of Order V Rule 20 (1) of the CPC. The High Court observed that the
order of the Trial Court permitting substituted service was cryptic and
that the Court had not recorded its satisfaction that the defendant was       E
keeping out of the way to avoid service or that the summons could not
be served in the ordinary manner for any other reason. Moreover, the
serving officer had not followed the procedure stipulated in Order V
Rule 17 where the defendant was not found to reside at the place where
he was last residing. The Court noted that besides the service to be
effected through the bailiff, the summons werenot sent to the defendant       F
at the address furnished by the plaintiff by registered post, with
acknowledgment due. The High Court also found that the Trial Judge
had ignored the provisions of Chapter III of the Civil Manual issued by
the High Court on the Appellate side for guidance of Civil Courts and
officers subordinate to it.                                                   G
       12. On behalf of the appellant, it has been submitted that the High
Court has misconstrued the provisions of Order V Rule 20. According
to the appellant, Order V Rule 20 allows an option to either affix the
notice at the court premises coupled with affixation at the home of the
defendant or by any other mode including publication in a newspaper. In
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364            SUPREME COURT REPORTS                           [2018] 1 S.C.R.


A     the present case, service of summons waseffected on the original
      defendant by publication in the newspaper on 4 October 2011. Hence, it
      was urged that there was no further requirement to affix the summons
      at the court premises and at the house of the original defendant.
      Moreover, it was urged that the order of the Trial Court was not cryptic
      and the report of the bailiff clearly indicated that the original defendant
B
      was not residing at the address submitted by the appellant because of
      which the summons werereturned.
             13. On the other hand, learned counsel for the respondent urged
      that the findings of the High Court in the first appeal are borne out from
      the record and are in accordance with law. Hence no interference is
C     warranted in the present proceedings.
             14. The record before the Court would indicate that the Trial Court
      by its order dated 9 February 2011 directed the issuance of summons to
      the original defendant, returnable on 15 March 2011. In pursuance of
      the order, summons wereissued on 4 March 2011. The report of the
D     bailiff dated 11 April 2011 indicates that the summons were returned
      unserved and the bailiff was informed that the original defendant had
      left the premises nearly two years earlier and resided elsewhere.
            15. Order V Rules 17 provides as follows:

E           “17. Procedure when defendant refuses to accept service,
            or cannot be found.- Where the defendant or his agent or such
            other person as aforesaid refuses to sign the acknowledgment, or
            where the serving officer, after using all due and reasonable
            diligence, cannot find the defendant, who is absent from his
            residence at the time when service is sought to be effected on
F           him at his residence and there is no likelihood of his being found at
            the residence within a reasonable time and there is no agent
            empowered to accept service of the summons on his behalf, nor
            any other person on whom service can be made, the serving officer
            shall affix a copy of the summons on the outer door or some other
G           conspicuous part of the house in which the defendant ordinarily
            resides or carries on business or personally works for gain, and
            shall then return the original to the court from which it was issued,
            with a report endorsed thereon or annexed thereto stating that he
            has so affixed the copy, the circumstances under which he did so,
            and the name and address of the person (if any) by whom the
H           house was identified and ‘whose presence the copy was affixed.”
 M/S NEERJA REALTORS PVT LTD v. JANGLU (DEAD) THR.                              365
           LR. [DR. D. Y. CHANDRACHUD, J.]

       Evidently as the report of the bailiff indicates, he was unable tofind   A
the defendant at the address which was mentioned in the summons.
The report of the bailiff does not indicate that the summons were affixed
on a conspicuous part of the house, at the address mentioned in the
summons. There was a breach of the provisions of Order V Rule 17.
When the application for substituted service was filed before the Trial
                                                                                B
Court under Order V Rule 20, a cryptic order was passed on 2 September
2011. Order V Rule 20 requires the Court to be satisfied either that
there is reason to believe that the defendant is keeping out of the way
for the purpose of avoiding service or that for any other reason,the
summons cannot be served in the ordinary way. Substituted service is
an exception to the normal mode of service. The Court must apply its            C
mind to the requirements of Order V Rule 20 and its order must indicate
due consideration of the provisions contained in it. Evidently the Trial
Court failed to apply its mind to the requirements of Order V Rule 20
and passed a mechanical order. Besides this, as observed by the learned
Single Judge of the High Court, the Trial Judge ignored the provisions
                                                                                D
contained in Chapter III of the Civil Manual issued by the High Court on
its appellate side for the guidance of civil courts and officers subordinate
to it. Paragraphs 33 to 36 of Chapter III are extracted below:
      “33. In addition to the service to be effected through a bailiff, a
      summons may also be sent to the defendant, to the address given
                                                                                E
      by the plaintiff, by registered post, prepaid for acknowledgement,
      provided there is a regular daily postal service at such place.
      34. Rules as to service of summons are contained in rules 9 to 30
      of Order V. Care should be taken to see that bailiffs follow those
      rules as well as the instructions given in the Bailiffs’ Manual.
                                                                                F
      35. It is the duty of the serving officer to follow the procedure and
      take all the steps laid down in rule 17 of Order V. He has no
      discretion for not taking the necessary steps, when the conditions
      laid down in the said rule are fulfilled.
      36. It is for the Court to determine whether the service is good or       G
      bad. In determining whether the service is good or not, the attention
      of Courts is drawn to the necessity of strictly following the
      provisions of the Civil Procedure Code as to the service of
      processes. Ordinarily, service should not be considered sufficient
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366               SUPREME COURT REPORTS                            [2018] 1 S.C.R.


A              unless all the requirements of the law in that behalf are fulfilled.
               The object of the service is to inform a party of the proceedings in
               due time. When from the return of a serving officer it appears
               that there is no likelihood that a process will come to the knowledge
               of the party in due time, or a probability exists that it will not so
               come to his knowledge, the service should not be considered to
B
               be proper. The law contemplates that the primary method of
               service should be tendering or delivering a copy of the process to
               the party personally, in case in which it may be practicable to do
               so. It is the duty of the serving officer to make all proper efforts
               to find the party, with a view to effect personal service. If it be
C              not possible after reasonable endeavour to find the party, then
               only the service may be made on an adult male member of the
               family residing with him.”
             The submission that under Order V Rule 20, it was not necessary
      to affix a copy of the summons at the court house and at the house
D     where the defendant is known to have last resided, once the court had
      directed service by publication in the newspaper really begs the question.
      There was a clear breach of the procedure prescribed in Order V Rule
      17 even antecedent thereto. Besides, the order of the Court does not
      indicate due application of mind to the requirement of the satisfaction
      prescribed in the provision.The High Court was, in these circumstances,
E
      justified in coming to the conclusion that the ex-parte judgment and
      order in the suit for specific performance was liable to be set aside.
            16. In Bhanu Kumar Jain v Archana Kumar1, a Bench of three
      Judges of this Court has held that :
F              “An appeal against an ex parte decree in terms of Section 96(2)
               of the Code could be filed on the following grounds:
               (i) the materials on record brought on record in the ex parte
                   proceedings in the suit by the plaintiff would not entail a decree
                   in his favour; and
G              (ii) the suit could not have been posted for ex parte hearing.”
            A defendant against whom an ex-parte decree is passed has two
      options:The first is to file an appeal.The second is to file an application
      under Order IX Rule 13. The defendant can take recourse to both the
      1
          (2005) 1 SCC 787
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 M/S NEERJA REALTORS PVT LTD v. JANGLU (DEAD) THR.                               367
           LR. [DR. D. Y. CHANDRACHUD, J.]

proceedings simultaneously. The right of appeal is not taken away by             A
filing an application under Order IX Rule 13. But if the appeal is dismissed
as a result of which the ex-parte decree merges with the order of the
Appellate Court, a petition under Order IX Rule 13 would not be
maintainable. When an application under Order IX Rule 13 is dismissed,
the remedy of the defendant is under Order XLIII Rule 1. However,
                                                                                 B
once such an appeal is dismissed, the same contention cannot be raised
in afirst appeal under Section 96. The three Judge bench decision in
Bhanu Kumar Jain has been followed by another bench of three Judges
in Rabindra Singh v Financial Commissioner, Cooperation,
Punjab2and by a two Judge bench in Mahesh Yadav v Rajeshwar
Singh3. In the present case, the original defendant chose a remedy of            C
first appeal under Section 96 and was able to establish before the High
Court, adequate grounds for setting aside the judgment and decree.
      17. For the above reasons, we find no reason to interfere with the
judgment and order of the High Court. The appeal accordingly stands
dismissed. There shall be no order as to costs.                                  D


Kalpana K. Tripathy                                          Appeal dismissed.



                                                                                 E




                                                                                 F




                                                                                 G



2
    (2008) 7 SCC 663
3
    (2009) 2 SCC 205
                                                                                 H