Allowed

M/S Guntur Communications Network Private Ltd. v. Eswara Cable Vision

TDSAT4 Jul 2011BROADCASTING PETITION/61/2010

Case brief

AI extract

What is this about?

The Tribunal examined an application to set aside an ex-parte decree passed against a respondent in a telecom dispute. It analyzed limitation periods under the Limitation Act and Order IX Rule 13 of CPC. Finding the decree could be set aside if the applicant deposited 25% of the decretal amount, the Tribunal granted the application on these terms.

What did the court decide?

The application to set aside the ex-parte decree is allowed, subject to the condition precedent that the Applicant deposits 25% of the decretal amount within four weeks.

M/S Guntur Communications Network Private Ltd. vs… — Civil Procedure and Limitation | TDSAT (2011)

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TELECOM DISPUTES SETTLEMENT & APPELLATE TRIBUNAL NEW DELHI

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Dated 04^th July, 2011

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M.A. 17 of 2011

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Petition No.61(C) of 2010

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M/s. Guntur Communication Network Pvt. Ltd., A.P. …Petitioner

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Versus

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M/s. Eswar Cable Vision, A.P. …Respondent

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BEFORE:

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HON’BLE MR.JUSTICE S.B. SINHA, CHAIRPERSON HON’BLE MR. G.D. GAIHA, MEMBER HON’BLE MR. P.K. RASTOGI, MEMBER

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For Petitioner

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For Respondnt

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: Mr. Atanu Mukharjee, Advocate : Mr. B.S. Sai, Advocate

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Order

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The Applicant herein has filed this petition for setting aside an ex-parte

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decree passed by this Tribunal on 6.10.2010, whereby and whereunder a

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decree for a sum of Rs. 2,82,200/ as the principal amount and a sum Rs.

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20,232/- by way of interest totaling to Rs. 3,00,644/-, was passed.

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The Respondent herein is a Multi Service Operator.

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The petitioner has been carrying on the business as a link operator in

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the town of Guntur under the name and style of M/s. Eswar Cable Vision.

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It is a partnership firm comprising of four partners.

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A Deed of Partnership was executed by the said partners on 8.8.2004.

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According to the Applicant, having been suffering losses it had closed

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down its business sometimes in July 2009. The Applicant, furthermore, denies and disputes the jural relationship between the parties.

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Indisputably, the original petitioner- the respondent herein had entered into an agreement with the Applicant in the year of 2007, pursuant whereto and in furtherance whereof, the Applicant was to pay a sum of Rs. 25,000/- per month plus taxes towards feed charges, the invoices wherefor were being served upon the Applicant.

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Diverse sums towards the subscriptions amount were being paid wherefor receipts used to be granted by the original petitioner.

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The respondent (original petitioner) had been maintaining its books of account vis-à-vis the Applicant herein also in regular course of its business.

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Inter-alia on the premise that the Applicant has failed and/or neglected to pay a sum of Rs. 4,01,665.45 including the amount of interest accrued thereon towards feed charges, the said petition was filed by the respondent herein.

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Notices were directed to be issued by this Tribunal. The first notice was sent on 19.03. 2010 by speed post at the address mentioned in the agreement i.e. 8^th Lane, Kakumauvari, Thota.

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It came back with a postal endorsement “left without instructions hence, returned to sender”. Another notice was sent on 20.3.2010, which was also returned with the postal endorsement “left without instructions hence returned to sender”.

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As the notices at the known address of the respondent could not be served, the respondent sent a set of complete set of petition at the alternate address of the applicant at Reddla Bazar by speed post on 31.03.2010, which came back with the endorsement “not in town”. The same was again sought to be tendered after three days. The postal endorsement thereon was ‘left’.

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At that juncture, the respondent filed an application for service of notice by substituted service, which was allowed. The notice was published in a Telugu newspaper (Eenadu) on 14.05.2010 and in another English newspaper (Deccan Chronicle) on 15.05.2010. As despite service of notice by way of

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publication in the news paper the Applicant did not appear, the aforementioned petition was taken up for ex-parte hearing and as noticed heretobefore an exparte decree was passed.

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The Decree Holder, thereafter, filed an Execution Application before this Tribunal, which was marked as E. A. No. 36 of 2010. Notices were again sought to be served upon the Applicant herein which had not been served.

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This application was filed by the applicant herein on 19.01.2011 on the premise that only on or about 08.01.2011 its authorized representative could come to know of the pendency of the Execution Application from one Shri. Anil Kumar, who has been carrying on business in cable services at Tenali.

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We may place on record that in the meantime the Execution Application was transferred for execution of the Decree to the District Judge of Guntur and the date fixed before the Transferee Court therefor was 10.01.2011.

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The Applicant in support of its case that no notice had been served and it was not aware of the publication thereof in the aforementioned news papers filed an affidavit.

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Mr. Macherla Jagan Mohan Rao, one of the partners of the applicant examined himself before this Tribunal in support of the application for setting

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aside the ex-parte decree.

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In his examination-in-chief, he stated that he had been running his

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cable business on the premises, which had been taken on rent from one Shri. D. Koteshwar Rao. According to him, he does not read newspapers and thus,

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he was not aware of the publication of summons in the said newspapers.

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He in his deposition stated:-

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I) He signs both in English as also in Telugu.

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II) He had not read the contents of application under Order IX Rule 13 of CPC. It was translated to him by his Advocate.

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III) There is no other Eswar Cable Vision operating in the said area.

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IV) There were three other partners of the Applicant firm viz. Mr. Bala Swami, Mr. Hari Prasad and Mr. Raghuram.

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V) He was not aware of their educational qualifications.

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VI) He is not aware of their Residential Addresses.

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VII) He is also not aware as to whether they had been residing in Guntur.

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VIII) He could not say as to whether the other partners do or do not read newspapers.

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IX) Any person coming to the 8^th Lane of Kakumauvari, Thota, would be led to Eswar Cable Vision.

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Some photographs were shown to him to show that he had been carrying on business in Reddla Bazar. He, however, did not identify himself in the said photographs.

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He has not filed any affidavit of Shri. K. Anil Kumar. The distance between Guntur and Tenali is about 25 Kms.

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Mr. B. S. Sai, the learned counsel appearing on behalf of the Applicant urged that keeping in view the fact that the Applicant was not aware of the pendency of this Petition, the application under O IX R 13 of CPC should be allowed.

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Mr. Tushar Rao, the learned counsel appearing on behalf of the respondent, on the other hand, has opposed the said prayer.

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Order IX Rule 13 of the Code of Civil Procedure, 1908, reads thus:

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“13. Setting aside decree ex parte against defendant— In any

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case in which a decree is passed ex parte against a defendant, he may apply to the Court by which the decree was passed for an order to set it aside; and if he satisfies the Court that the summons was not duly served, or that he was prevented by any sufficient cause from appearing when the suit was called on for hearing, the Court shall make an order

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setting aside the decree as against him upon such terms as to costs, payment into Court or otherwise as it thinks fit, and shall appoint a day for proceeding with the suit;

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Provided that where the decree is of such a nature that it cannot be set aside as against such defendant only it may be set aside as against all or any of the other defendants also:

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[Provided further that no Court shall set aside a decree passed ex parte merely on the ground that there has been an irregularity in the service of summons, if it is satisfied that the defendant had notice of the date of hearing and had sufficient time to appear and answer the plaintiff's claim]

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[Explanation.—Where there has been an appeal against a decree passed ex parte under this rule, and the appeal has been disposed of an any ground other than the ground that the appellant has withdrawn the appeal, no application shall lie under this rule for setting aside that ex parte decree.]”

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Indisputably, an ex-parte decree can be set aside only when the applicant shows existence of a sufficient cause.

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Order IX Rule 13 was amended in year 1976 by the Code of Civil

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Procedure (Amendment) Act, 1976 to the effect that in the event the Court is satisfied that there has been service of summons in terms of the provisions laid down in Code of Civil Procedure or otherwise, having regard to the proviso appended to Order IX Rule 13 of the Code of Civil Procedure an irregularity in service of summons would not by itself be constituted to be a sufficient reason for setting aside an ex-parte decree.

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In terms of the provisions of the Telecom Regulatory Authority India, Act, 1997, this Tribunal has framed procedural Rules.

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Rule 5 (ii) contemplates not only a service of summons through a Court of Law but also under registered cover, speed post, courier etc..

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If the contentions of the Applicant are correct that it had not been carrying on business where his head-ends were situated, evidently, his address was not known to the respondent herein. It could have therefore filed an application for substituted service in terms of Order V Rule 20 of the CPC, 1908.

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It has not been denied that the newspaper in Eneadu which was published in Telugu is a widely circulated one. Such is the case with the newspaper Deccan Chronicle also.

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It is not the case of the Applicant that none of its four partners read

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newspapers. It is not the case of the Applicant that none of its four partners, were not aware of the English language. In any event notice has also been published in Telugu language.

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Interestingly, the Applicant in his verification in support of the application under Order IX Rule 13 of the CPC, 1908, does not state that the contents of the application had been read over and explained to him in Telugu. He had verified that the statements made in the said application as true to his knowledge.

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Moreover, it was the bounden duty of the Applicant to prove that it came to know about the pendency of the Execution Application and the fact that an ex-parte decree has been passed for the first time on 08.01.2011. The burden of proof was on it.

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Mr. Sai, however, has placed strong reliance on a decision of Supreme Court of India in Sushil Kumar Sabharwal v. Gurpreet Singh & Others , reported in (2002)5 SCC 377, wherein it was held that in terms of Order IX Rule 6 of the CPC, 1908, it is the date of knowledge of the hearing and not the knowledge of pendency of the suit, which would be relevant for purpose of the proviso appended to Order IX Rule 13 of the CPC, 1908.

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In that case a finding of fact was arrived that was not a case of mere

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irregularity in service of summons but a case of non service of summons. The Applicant had examined himself in that case and the court did not find any material on record to draw an adverse inference that he had any notice of the date of hearing and had sufficient time to appear and answer the plaintiff’s claim which he did not avail and utilize.

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It was on that premise referring to Order IX Rule 6 of the CPC, 1908, it was observed:

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“13. Be that as it may, we are satisfied that the summons was not served on the defendant-appellant. He did not have an opportunity of appearing in the trial court and contesting the suit on merits. The trial court and the High Court have committed a serious error of law resulting in failure of justice by refusing to set aside the ex parte decree.”

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Order IX Rule 6, inter-alia envisages a situation where summons were not duly served or served but not in due time. Such is not the case here, Summons were published in two newspapers on 14.05.2010 and 15.05.2010. The ex-parte decree was passed on 06.10.2010.

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The Applicant, therefore, had sufficient time to appear and contest the matter.

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The Supreme Court of India in Basant Singh v. Roman Catholic

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Mission, reported in (2002) 7SCC 531, has held that even if, a publication is

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not made in the newspapers for which permission had been granted the same would constitute a mere irregularity.

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We may moreover notice that recently in Parimal v. Veena reported in (2011)3 SCC 545, Dr. Chauhan, J. speaking for a Division Bench of the Supreme Court of India held as under:

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“12. It is evident from the above that an ex parte decree against a defendant has to be set aside if the party satisfies the court that summons had not been duly served or he was prevented by sufficient cause from appearing when the suit was called on for hearing. However, the court shall not set aside the said decree on mere irregularity in the service of summons or in a case where the defendant had notice of the date and sufficient time to appear in the court. The legislature in its wisdom, made the second proviso mandatory in nature. Thus, it is not permissible for the court to allow the application in utter disregard of the terms and conditions incorporated in the second proviso herein.

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13. “Sufficient cause” is an expression which has been used in a large number of statutes. The meaning of the word “sufficient” is “adequate” or “enough”, inasmuch as may be

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necessary to answer the purpose intended. Therefore, word “sufficient” embraces no more than that which provides a platitude which when the act done suffices to accomplish the purpose intended in the facts and circumstances existing in a case and duly examined from the viewpoint of a reasonable standard of a cautious man. In this context, “sufficient cause” means that the party had not acted in a negligent manner or there was a want of bona fide on its part in view of the facts and circumstances of a case or the party cannot be alleged to have been “not acting diligently” or “remaining inactive”. However, the facts and circumstances of each case must afford sufficient ground to enable the court concerned to exercise discretion for the reason that whenever the court exercises discretion, it has to be exercised judiciously. (Vide Ramlal v. Rewa Coalfields Ltd. [ AIR 1962 SC 361] , Lonand Grampanchayat v. Ramgiri Gosavi [ AIR 1968 SC 222] , Surinder Singh Sibia v. Vijay Kumar Sood [(1992) 1 SCC 70 : AIR 1992 SC 1540] and Oriental Aroma Chemical Industries Ltd. v. Gujarat Industrial Development Corpn. [(2010) 5 SCC 459 : (2010) 2 SCC (L&S) 50 : (2010) 2 SCC (Cri) 1291 : (2010) 2 SCC (Civ) 448] ).

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14. In Arjun Singh v. Mohindra Kumar [ AIR 1964 SC 993] this Court observed that every good cause is a sufficient cause

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and must offer an explanation for non-appearance. The only difference between a “good cause” and “sufficient cause” is that the requirement of a good cause is complied with on a lesser degree of proof than that of a “sufficient cause”. (See also Brij Indar Singh v. Kanshi Ram [ (1916-17) 44 IA 218 : AIR 1917 PC 156] , Manindra Land and Building Corpn. Ltd. v. Bhutnath Banerjee [ AIR 1964 SC 1336] and Mata Din v. A. Narayanan [(1969) 2 SCC 770 : AIR 1970 SC 1953] .

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15 [Ed.: Para 15 corrected vide Official Corrigendum No. F.3/Ed.B.J./14/2011 dated 25-2-2011.] . While deciding whether there is sufficient cause or not, the court must bear in mind the object of doing substantial justice to all the parties concerned and that the technicalities of the law should not prevent the court from doing substantial justice and doing away the illegality perpetuated on the basis of the judgment impugned before it. (Vide State of Bihar v. Kameshwar Prasad Singh [(2000) 9 SCC 94 : 2000 SCC (L&S) 845 : AIR 2000 SC 2306] , Madanlal v. Shyamlal [(2002) 1 SCC 535 : AIR 2002 SC 100] , Davinder Pal Sehgal v. Partap Steel Rolling Mills (P) Ltd. [(2002) 3 SCC 156 : AIR 2002 SC 451] , Ram Nath Sao v. Gobardhan Sao [(2002) 3 SCC 195 : AIR 2002 SC 1201] , Kaushalya Devi v. Prem Chand [(2005) 10 SCC 127] , Srei

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International Finance Ltd. v. Fairgrowth Financial Services Ltd. [(2005) 13 SCC 95] and Reena Sadh v. Anjana Enterprises [(2008) 12 SCC 589 : AIR 2008 SC 2054] .

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16. In order to determine the application under Order 9 Rule 13 CPC, the test that has to be applied is whether the defendant honestly and sincerely intended to remain present when the suit was called on for hearing and did his best to do so. Sufficient cause is thus the cause for which the defendant could not be blamed for his absence. Therefore, the applicant must approach the court with a reasonable defence. Sufficient cause is a question of fact and the court has to exercise its discretion in the varied and special circumstances in the case at hand. There cannot be a straitjacket formula of universal application.”

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So far as the presumption of service by registered post and burden of proof, are concerned it was held:

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“19. The provisions of Section 101 of the Evidence Act provide that the burden of proof of the facts rests on the party who substantially asserts it and not on the party who denies it. In fact, burden of proof means that a party has to prove an

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allegation before he is entitled to a judgment in his favour. Section 103 provides that the burden of proof as to any particular fact lies on that person who wishes the court to believe in its existence, unless it is provided by any special law that the proof of that fact shall lie on any particular person. The provision of Section 103 amplifies the general rule of Section 101 that the burden of proof lies on the person who asserts the affirmative of the facts in issue.”

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The period of limitation having regard to the Article 123 of the Limitation Act, 1963 for filing an application for the setting aside the decree would be ‘Thirty days’ from the date of passing of the decree in a case where summons have been served.

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It reads as under:

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Description of application	Period of	Time from which period
	limitation	begins to run
123.To set aside a decree passed_ex-_
_parte_or to re-hear an appeal decreed		The date of the decree or
or heard_ex-parte._	Thirty days	where the summons or notice
_Explanation.-_for the purpose of this		was not duly served, when the
article, substituted service under		applicant had knowledge of
Rule 20 of Order V of the Code of		the decree.

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Civil Procedure, 1908 shall not be deemed to be due service.

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The application is also barred by limitation, which according to the petitioner is of 63 days.

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In view of aforementioned findings, we would have ordinarily dismissed the application for setting aside the ex-parte decree. However, the explanation appended to Article 123 in the schedule appended to the Limitation Act, 1963 provides that for the purpose of the said article, a substituted service under Rule 20 of Order V shall not be deemed to be due service.

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It is true that in terms of Sub- Rule 2 of Rule 20 of Order V of the Code of Civil Procedure the service substituted by the order of the Court would be effectual as it has been made on the defendant personally subject, of course, to compliance of Rule 1 A thereof, no such presumption is raised for the purpose of ‘Explanation’ appended to Article 123 of the Limitation Act.

¶120

In M. Narasimha Reddy and Ors. vs Begari Samuel, reported in 2002 (5) ALT 766, the Andhra Pradesh High Court has clearly held so. (See also C.K.N. Gounder Alias C.K.N. vs R. Nachimuthu S/O N. Ramaswamy, (1989) 1 MLJ 496).

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Keeping in view the aforementioned decisions of the High Court as also a recent decision of this Tribunal in M.A. in 53 of 2010 filed in Petition No. 282 of 2007, we are of the opinion that interest of justice would be sub served if this Tribunal, sets aside the ex-parte decree so as to enable the Applicant

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herein to contest the matter on merits, subject however, to the condition that the Applicant deposits 25% of the decretal amount by way of a condition precedent therefor. The said amount should be deposited before this Tribunal within a period of four weeks from date.

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For the reasons aforementioned, this petition is disposed of on the above terms. In the facts and circumstances of the case there shall be no order as to costs.

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……………… (S.B. Sinha)

Chairperson

Member

Member

/AS/

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M/S Guntur Communications Network Private Ltd. v. Eswara Cable Vision

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M/S Guntur Communications Network Private Ltd. v. Eswara Cable Vision

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