Allowed

Ms Rathnam Pharmaceuticals Pvt. Ltd. v. Syndicate Bank

DRT18 Apr 2024MA/101/2023

Case brief

AI extract

What is this about?

This court allowed miscellaneous applications to set aside an ex parte order dated 09.02.2020. The court held that since the delay in filing a written statement was condoned and the ex parte proceedings occurred during the onset of the COVID-19 lockdown, the defendants were entitled to participate in the original cause action.

What did the court decide?

Ex parte order dated 09.02.2020 set aside and OA restored to file; original Recovery Case recalled.

Ms Rathnam Pharmaceuticals Pvt. Ltd. versus… — Civil Procedure and Limitation | DRT (2024)

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70.04.2024

Orders not ready in MAs. Call on 18.04.2024.

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78.04.2024

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MA Nos.1O1, 1O2 & lO3 of 2023:

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The defendants 1 to 5 in oA No.758/2019 have filed the following Miscellaneous Applications:

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(i) MA No.101/2023 is filed by the 1st defendant; (ii) MA No.102/2023 is filed by the defendants 2,4 & 5; and

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( iii) MA No.103/2023 is filed by the 3'd defendant;

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to set aside lhe ex pafte order dated 79.02.2020

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The 1st respondent-applicant bank filed separate counters resisting the petitions.

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Heard learned counsel for the petitioners and learned counsel for the 1st respondent. Perused the written submissions filed by both the parties and the material record.

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According to learned counsel for the petitioners, the applicant bank obtained the ex parte decree without servlng the summons and suppressing the material facts about non-settlement of insurance claim etc., thereby misled the Tribunal. The respondent-a pp lica nt bank also suppressed before the Recovery Officer about realization of substantial amounts by disposal of some of the immovable properties and got issued the demand notice for the amounts which are not actually due. The petitionersdefendants have got a very strong case on merits. Learned counsel further submits that vide order dated 19.01.2023 this Tribunal condoned the delay after observing that the summons was not served. Not only summons was unserved but also copy of the OA along with documents was not served as per Rule 11 of the RDB Act. The averments are common in condone delay petition and the present set aside petition and hence petition may be allowed in the interest of justice. He relied on judgement in Kavali Naravana and Ors. vs. Kavali Chennamma .2OOS (1) ALD 6Z2J wierein the Hon'ble High Court of Andhra Pradesh set aside the ex pade preliminary decree observing that the reasons pleaded for condonation of delay and setting aside the ex parte preliminary decree are one and the same and that the delay was properly examined and allowed. With these contentions, learned counsel prayed to allow the applications and permit the petitioners to file the written statement.

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Per contra, learned counsel for the 1st respondent bank submits that the summons was deemed to be served as per Sec.27 of the General Clauses Act since the summons were returned with endorsement Addressee not in Station. However, substitute service by way of paper,, ,SrY\ .,/h\N'D 7^/$',-q

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publication was carried out as^{per directions of the} iribunal. Non-settlement of^{insurance has no bearingin} the RP^{proceedings.Though some of the immovable -} properties have been sold, there is^{still outstanding} amount in the account.^{The present petitionsare filed} without filing written^{statementand it goes to showthat} they would seek time^{and drag on the matter as long as} possible. The^petitioners even^{did not bother to appear} before the Recovery^{Officer right from 2020 to 2023 which} shows the intension of^{petitioners to delay 'the RC} proceedings. Despite having^{knowledge,the petitioners} supp.essed the^{fact that the demand notice was published} and'Form-16^{issued by the RO. Learned counselfurther} submits that mere^{allowingdelay condone petition does} not mean to automatically^{allowthe set aside petition'He} relied on^judgment of^{Hon'ble Supreme Court in Subodh} Kumar vs.-shamim^{Ahmed in Civil ApDealNos'802-803 of 2021} a"ria"a * bs,os.zozt^{in support of his contention'He also} .etleO on^{judgement of Hon'ble Delhi High Court in sh'Tilak} Raj Aggariat End^{Anr. vs. Delhi DevetoomentAuthoritv and Anr'} iZil6s) uo.zogt^{or ngs decided on ts.os.20z4 wherein the} delay *as co"doned^{urhereas applicationfiled underOrder} IX Rule 13 of CPC^{wasdismissed' The present applications} are filed as dilatory^{tactics to thwart the recovery} proceedings of the bank^{and hence all the three petitions} are liable to be^dismissed.

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6, In reply, learned^{counselfor petitioners submits that} the delay iondonation^{has since been allowed and} unchallenged,^{the same at'.i]:ned finality'The same issue} cannot bJraised^{again under the principleof res judicata'} ine^{petitionersundertaketo file the written statement} *itf,ln fO days^{from the date of supply of OA material by} ine r"spono"nt^{bank.Learned counsel further subrnitsthat} rnott oi the^{postings beforeRO wereduringCovid period'} The set of iacts^{in the judgementof Hon'bleSupreme} Court relied on^{by reipondentbank are absolutely} Jiisimitar.^{As far as} iudgement^{of Hon'ble Delhi High Court} ir" .on.utn"d,^{the iactl are diametricallyoppositeto th.e} iu.tt^-of the^{case of petitioners' Even otherwise' this} iiiur"ir is^{guided oy 'oinoing precedentof decision of} jurisdictional High Court.

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I have^{considered the arguments advanced by both} putti"t ai tengtn, It^{is a matterof record that the delay} hu, already^{been condoned by allowing the delay} conOonation'petition^{vide orderclated 19'01'2023'Thekey} Ltuu inrofr"O^{in these three MAs is setting aside the ex} 'iii oii., oit"o rs.02.2020 against the.defendants and oermit them to^{contest the OA by filing written statement'} il; i";;;;;^{counselfor both parties relied on judgements,} of Hon'ble^{SupremeCourt and Hon'ble High Courts of} inOnia -Pradesh and Delhi to buttress their respective versions.^{Accordingto learned counsel for petitionersfonce} ;;iil1;;;oneoJ^{tne ex parte order can be set asideon} ir'"^{'turnu groundswheieas the learned counselfor} i"tpo"o""t^{"bank vehementlv opposeo,9$"?rstating}

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oA7s8l2019

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that mere allowing^{condonedelay petition does not} automatically^{mean to allow the set asidepetition'}

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B. However,^{as rightly pointed out by the learned} counsel for the^{petitioners, the set of factsin the case on} nini una the^{judgementof Hon'ble SupremeCourt in} Slbgdh^{Kumar vs. Sham} are not similar'^{In the} c,[-eO :rOgen'ent,^{the Hon'ble Supreme Court upheld the} triat cou.[ order^{rejecting the Order9 Rule 13 application'} As^per facts of^{the casetherein, the tenant filed a civil suit} and the trial court^{on 16.05'1997recordedcategorical} iinOlngt against the^{tenant. In the present case, no such} orOe."erlsis against^{the petitioners.In the judgement of} Hon'ble Delhi^{t'lighCourt, the facts were that the delaywas} condoned but^{Jet asidepetition was dismissedon the} g.ounO that the^{particular defendant failed to prove that} iumrnont^{was not servedon him. In the case on hand, the} delay was condoned^{in the light of Hon'ble Supreme Court} orOer OateO lO.Ol.2022^{exemptingperiod of limitation} between 15.03.2020^{and 28.02.2022'However, I would} deal with the set^{aside petition on merits'}

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As far as the set^{asidepetitionsare concerned,the} ptea set out in the^{petitions is that due to onset of Covid} ianOemic^{from 202b they could not move out and faced} difficulty in contacting^{their counseland obtaining certified} copies. The said^{reason is acceptable since the spread of} Corona virus started^{from January, 2020' The defendants} were set ex^parte on^{23.01.2020and final ex parte order} was passed on^{19.02.2020and thereafterlockdown was} imposed in March,^{2020. The petitioners also contend that} iome of the^{immovable properties were disposedof and} the respondent bank^{acceptsthe same'However,the} contention of^{petitionersis that the realized amount has} not been reported^{and demandnotice has been issued for} the entire outstanding^{dues. Considering the facts and} circumstances of the^{case as supra, I deem it appropriate} to give an opportunity^{to the defendantsto participate in} thiOA^{proceedings. Accordingly,the petitions deserve to} be allowed.

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In the result,^{MA Nos.101, 102 and 103 of 2023are} allowed by setting^{aside the ex parte order dated} tg.O2.2O2O against^{the defendants1 to 5.}

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Consequently,^{OA is restoredto file and the RC} No.308/2020 is^{hereby recalled. Communicatea copy-0f-} this order to^{the learned Recovery Officer'}

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./r / a;*P 3- d.

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Call on 06.05.2024 for^{filing written statement} without fail.

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*rdt . P.O.

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Ms Rathnam Pharmaceuticals Pvt. Ltd. v. Syndicate Bank

Case brief

What is this about?

What did the court decide?

Ms Rathnam Pharmaceuticals Pvt. Ltd. v. Syndicate Bank

Case brief

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What did the court decide?

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