The apex court nullified a decree as failure to appoint a guardian for the minor defendant

Order XXXII, Rule 3, is found in the First Schedule to the Code. Under Section 121 of the Code, the Rules in the First Schedule shall have effect as if enacted in the body of the Code until annulled or altered in accordance with the provisions of Part ­X, which comprises of Sections 121 to 131. The High Courts are empowered under Section 122 of the Code to annul/alter or add to all or any of the Rules in the First Schedule, for regulating the procedure of the civil courts subject to their superintendence…; (Para 15)

K.P. NATARAJAN & ANR VS MUTHALAMMAL & ORS.

Special Leave Petition (C) No.2492 Of 2021

Decided on 16th July 2021

Petitioner/Plaintiff Counsel: - Senior Counsel Mr. S. Nagamuthu

Respondent/ Defendant Counsel: - Senior Counsel Mr. R. Balasubramanian

The Supreme Bench consisting of Justice Indira Banerjee and V. Ramasubramanian dismissed the Special Leave Petition No.2492 Of 2021

In a Civil Revision Petition filed under Section 115 of the Code of Civil Procedure, 1908 (for short “the Code”), challenging an order of the trial Court refusing to condone the delay of 862 days in seeking to set aside an ex­parte decree for specific performance, the High Court found that the ex­parte decree was a nullity, as it was passed against a minor without the minor being represented by a guardian duly appointed in terms of the procedure contemplated under Order XXXII, Rule 3 of the Code. Therefore, the High Court, exercising its power of superintendence under Article 227 of the Constitution, set aside the ex­parte decree itself on condition that the petitioners before the High Court/defendants pay a sum of Rs.2,50,000/­, representing the amount already spent by the decree holders in purchasing stamp paper etc. Aggrieved by the said order of the High Court, the decree holders are before us in this special leave petition.

In a suit O.S. No.264 of 2013 filed by the petitioners herein for specific performance of an agreement of sale dated 25.04.2011, the respondents were duly served with summons, but after having entered appearance through counsel they remained ex­parte. The trial Court decreed the suit ex­parte on 08.04.2015.(Para 3)

At this stage it may be relevant to take note of one fact, namely, that the petitioners sought, as an alternate relief, a decree for refund of the money paid with interest at 18% per annum in the event of the Court not granting the relief of specific performance. But the trial Court held albeit without reasons, that the petitioners are entitled, for the primary relief of specific performance. In the plaint as it was filed by the petitioners herein, the third defendant was described as “minor S Aravindarajan, aged about 16 years, son of Sampathkumar represented by the next friend father M. Sampathkumar”. Therefore, the petitioners had filed, along with the plaint, an application in I.A No.981 of 2013 under Order XXXII, Rule 3 of the Code for appointing the second respondent herein (his father and the second defendant) as the guardian of the minor.

As noted by the High Court, the trial Court, after serving notice on the second defendant, passed an Order in I.A.No. 981 of 2013 on 23.03.2014 to the following effect:­

“Batta served. Vakalat by guardian to minor

filed. Hence this petition is closed….(Para 5)

Seeking execution of the decree, the petitioners filed E.P No.33 of 2015. Notices were served on all the respondents in the Execution Petition and the Execution Petition is said to have come up for hearing on two dates in December­2015 and on several dates in the year 2016. Eventually the respondents were set ex­parte in the Execution Petition on 18.10.2016 and the petition was allowed. Thereafter the respondents filed an application in November2016 for setting aside the ex­parte order in the Execution Petition. It was numbered only in the year 2017 as E.A. No.40 of 2017. But in the meantime, the petitioners were called upon to deposit non­judicial stamp papers of the value of Rs.1,98,000/­ for the execution of the sale deed. They did so and a sale deed was in fact executed by the Court on 04.01.2017.

It is only thereafter that the respondents filed an application in I.A No.142 of 2017 for condonation of the delay of 862 days in seeking to set aside the ex­parte decree. This application filed on 19.09.2017 was dismissed by the trial Court by an order dated 28.11.2017, primarily on three grounds namely: (i) that there was no proper explanation for the delay; (ii) that even the written statement was not filed within the time stipulated in Order VIII, Rule 7; and (iii) and that after allowing even the execution to proceed ex­parte and after having allowed the sale deed to be executed by the Executing Court, the respondents cannot seek condonation of the huge delay. Aggrieved by the dismissal of the petition to condone the delay in seeking to set aside the ex­parte decree, the respondents filed a revision petition under Section 115 of the Code before the High Court. In order to ensure that the petitioners/decree holders are not poorer after a decree (or because of the decree), the learned Judge put the respondents on condition that they should pay of Rs.2,50,000/­ as cost to the petitioners herein on or before16.10.2020, as the petitioners/decree holders had already deposited stamp papers of the value of Rs.1,98,000/­ and got the sale deed executed.

The main grounds of attack, to the impugned order of the High Court, for the petitioners are :­

(i) that the High Court ought not to have set aside an ex­parte decree, in a revision petition arising out of an application under Section 5 of the Limitation Act, 1963;

(ii) that the Court was not even entitled to invoke equity in favour of the respondents who were grossly negligent, first in defending the suit, next in defending the executing proceedings and then in seeking to set aside the ex­parte decree after nearly a year of seeking to set aside the ex­parte order passed in the Execution Petition; and

(iii)that it was not even one of the grounds raised or points argued by the respondents herein in their revision petition before the High Court either that the procedure prescribed under Order XXXII, Rule 3 of the Code was not followed or that a grave prejudice or injustice has been caused to the defendant/minor, on account of the failure, if any, on the part of the trial Court.

We have carefully considered the rival contentions. There is no dispute on facts and there is no escape from the conclusion that the respondents have been grossly negligent in defending the suit as well as the execution proceedings. But the fact remains that while the parties can afford to remain negligent, the Court cannot. (Para 14)

Order XXXII, Rule 3, is found in the First Schedule to the Code. Under Section 121 of the Code, the Rules in the First Schedule shall have effect as if enacted in the body of the Code until annulled or altered in accordance with the provisions of Part­X, which comprises of Sections 121 to 131. The High Courts are empowered under Section 122 of the Code to annul/alter or add to all or any of the Rules in the First Schedule, for regulating the procedure of the civil courts subject to their superintendence. (Para 15)

It may be of interest to note that Rule 3­A was inserted in Order XXXII by CPC Amendment Act 104 of 1976. It is this Rule that introduced for the first time into the Code, the question of prejudice to the minor. But this Rule 3­A applies only to cases where the next friend or guardian for the suit of the minor had an interest in the subject matter of the suit adverse to that of the minor. This amendment was a sequel to certain conflicting opinions on the question as to whether a decree passed in cases where the minor was represented by a guardian who had an interest in the subject matter of the suit adverse to that of the minor, was void or voidable.

Therefore, we find no illegality in the order of the High Court warranting our interference under Article 136. Hence, this Special Leave Petition is dismissed. (Para 33)

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Akshata Pai