Shajudhen P.P v. N.K. Ashraf

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ``` THE HONOURABLE MR. JUSTICE T.R.RAVI ``` ``` THURSDAY, THE 14[TH] DAY OF MARCH 2024 / 24TH PHALGUNA, 1945 ``` ``` OP(C) NO. 2357 OF 2023 ``` ``` AGAINST THE ORDER DATED 04.09.2023 IN RPIA NO.01/2023 IN OS NO.17 OF 2021 OF SUB COURT VADAKARA ``` ## **`PETITIONER/PETITIONER/DEFENDANT:`** ``` SHAJUDHEN P.P AGED 51 YEARS S/O KADERKUTTY, SHAMIAYAN, KUTTIKKOL, TALIPARAMBA, TALIPARAMBA P.O, KANNUR, PIN – 670141. ``` ``` BY ADVS. BASIL MATHEW AJAY KRISHNAN S.(K/1630/2020) NINAN JOHN(K/346/1997) SANJANA SARA VARGHESE ANNIE(K/000582/2018) ARYA A.R.(K/1666/2018) ANJITHA JOBI(K/002568/2023) ROSEMARIA JOHNSON(K/003203/2023) ``` ## **`RESPONDENT/RESPONDENT/PLAINTIFF:`** ``` N.K.ASHRAF AGED 56 YEARS S/O ABOOBACKER, ARFA, NUT STREET P.O, VATAKARA, KOZHIKODE, PIN 673104,REPRESENTED BY THE POWER OF ATTORNEY HOLDER T.I.NASSAR, S/O MOOSSA HAJI, AGED 56 YEARS, SHANU MAHAL, NUT STREET P.O, VATAKARA, KOZHIKODE, PIN – 673104. ``` ``` BY ADVS. B.KRISHNAN R.PARTHASARATHY(K/151/1996) ``` ``` THIS OP (CIVIL) HAVING COME UP FOR ADMISSION ON 14.03.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` OP(C) NO. 2357 OF 2023 ``` ``` 2 ``` ## **“C.R”** **T.R.RAVI, J** . **--------------------------------------------OP(C) No.2357 of 2023 ------------------------------------------------------** Dated this the 14[th ] day of March, 2024. ## **JUDGMENT** The original petition has been filed challenging Ext.P3 order setting aside an ex-parte decree on terms. The original petition has been filed by the defendant contending that the condition to pay Rs.10 lakhs towards arrears rent/licence fee is onerous and should not have been imposed while setting aside an ex-parte decree. 2. According to the petitioner, the petitioner is put in possession of the plaint schedule building on the basis of Ext.P4 Licence Agreement. It is contended that even though the agreement is titled as a licence agreement, it is in fact a lease. The agreement says that there is a liability to pay a licence fee of Rs.1,40,000/- per month from 01.07.2015 onwards. The suit was filed for mandatory injunction and damages for occupation of the premises after the termination of the licence. Even though written statement was filed, the ``` OP(C) NO. 2357 OF 2023 ``` ``` 3 ``` defendant/petitioner remained ex-parte and the suit was decreed ex-parte directing payment of a sum of Rs.23,20,078.85 as arrears of licence fee for the period till January, 2020 and a further direction to hand over vacant possession of the plaint schedule building to the plaintiff/respondent or his power of attorney holder. Ext.P5 is the copy of the judgment. The petitioner filed an application for setting aside the ex-parte decree. 3. The Subordinate Judge, Vatakara allowed the application and set aside the ex-parte decree, on condition of deposit of Rs.10 lakhs towards arrears of rent. The order of the court shows that the petitioner failed to participate in the trial when the suit was listed for trial. The Court found that the attempt of the petitioner is to protract the proceedings. It was noticed that the prescription of the doctor produced along with the application, which cites medical reasons as the reason for non-appearance, was the prescription issued from a skin clinic. It is also stated that no reason was stated for nonrepresentation on the day on which the case was posted for evidence. Despite the above facts, the Subordinate Judge, relying on the judgment in **Union of India vs. Ramcharan** ``` OP(C) NO. 2357 OF 2023 ``` ``` 4 ``` [AIR 1964 (SC) 215], took the view that the Court need not be extremely strict and a liberal approach is essential to do substantial justice between the parties and hence set aside the ex-parte decree. The Court took into account the fact that no amount has been paid towards the licence fee or rent, as the case may be, after filing the suit and even on the day of the filing of the suit more than Rs.20 lakhs was due as arrears of rent and in the circumstances, directed a deposit of Rs.10 lakhs for the purpose of setting aside the ex-parte decree. 4. Heard Sri.Basil Mathew, counsel for the petitioner and Sri.R.Parthasarathy, counsel for the respondent. 5. The contention of the counsel for the petitioner is that under Order IX Rule 7, though the Court has power to impose conditions for setting aside an ex-parte decree, the conditions so imposed shall not be onerous. It is submitted that even as per the ex-parte decree, the court has not granted a decree for the occupation of the premises after the date of suit and hence the court should not impose a condition for payment of rent for the said period. A further contention is taken that the rental for five months has been waived and there is an agreement for reducing 25% of the monthly rent ``` OP(C) NO. 2357 OF 2023 ``` ``` 5 ``` from June 2020 owing to Covid pandemic. It is further submitted that the petitioner has shown sufficient cause and once sufficient cause is found by the court, a condition as imposed ought not to have been imposed. 6. The counsel placed reliance on a judgment of a learned Single Judge of this Court in **Antony Varkey v. South Indian Bank Ltd.** [1991 KHC 127], the judgments of the Hon’ble Supreme Court in **Vijay Kumar Madan v. R.N.Gupta Technical Education Society** [2002 KHC 1257] and **G.P.Srivastava v. R.K.Raizada and Others** [2000 KHC 1023], the judgment of a Division Bench of this Court in **Narikodan Sathyavalli and Another v. Syndicate Bank, Maloor Branch, Kannur District** [2015 KHC 3166] and the judgment of a Division Bench of this Court in **Peeves Enterprises (M/s.) and Another v. Muhammed Ashraf** [2015(3) KHC 981]. 7. In **Antony Varkey** (Supra) the learned Judge held that under Order IX Rule 13 there is a discretion bestowed on the court to set aside the decree on imposing terms and conditions. The court held that the words “upon such terms as to costs, payment into court or otherwise as it thinks fit” give ``` OP(C) NO. 2357 OF 2023 ``` ``` 6 ``` ample latitude to the court while setting aside the ex-parte decree. The court further found that the contention that the court can only award costs and has no power to direct deposit of the decree amount either in part or in full is not tenable. The learned Single Judge relied on the judgment in **Surayya v. Thayaramma** [AIR 1950 Madras 618] in support of the said view. However, on facts, the court held that the direction to deposit Rs.5 lakhs towards decree debt requires modification and the same was modified directing payment of Rs.1,000/- as cost to the respondent. In the above judgment it was specifically stated that the court has discretion to even order deposit of the decree amount and that the only aspect to be looked into is whether the condition imposed is onerous. 8. In **G.P. Srivastava** (Supra) the Hon’ble Supreme Court was considering the case of an ex-parte decree in a suit for ejectment and recovery of arrears of rent. The Court held that if sufficient cause is made out for non-appearance of the defendant on the date fixed for hearing, he cannot be penalised for his previous negligence which had been overlooked and condoned. It was held that if the defendant approaches the court immediately within the statutory time ``` OP(C) NO. 2357 OF 2023 ``` ``` 7 ``` specified, the discretion is normally exercised in his favour, provided, the absence was not malafide or intentional. That was a case where the trial court had found that the absence was not for just or sufficient cause and the said finding was accepted by the High Court which also rejected the revision petition refusing to set aside the ex-parte decree. It is not a case where the ex-parte decree was set aside on imposing a condition. The Hon’ble Supreme Court allowed the appeal and set aside the ex-parte decree on payment of cost of Rs.5,000/to the other side. The judgment does not deal with the question whether the condition imposed was onerous. All that it said was that the words “was prevented by any sufficient cause from appearing” must be liberally construed to enable the court to do complete justice. 9. In **Vijay Kumar Madan** (Supra), the Hon’ble Surpeme Court was considering a suit for recovery of rent and the judgment which had been decreed ex-parte. In the said case, the trial court set aside the ex-parte decree directing the defendants to deposit monthly lease amount in the court at the time of filing written statement. The High Court set aside the order of the trial court finding it to be too onerous and ``` OP(C) NO. 2357 OF 2023 ``` ``` 8 ``` directed the trial court to proceed to dispose of the suit as early as possible. The plaintiff took up the matter before the Hon’ble Supreme Court. By the time the case was taken up for hearing the plaintiffs had already secured possession of the suit premises and the defendants had also given up their right to restitution. So far as the possession of the premises was concerned, all that remained was the claim for arrears of rent. The Hon’ble Supreme Court directed the suit to be restored to file for considering the above question on condition that the defendants pay a cost of Rs.30,000/- to the plaintiff. The Court also gave liberty to the plaintiff to move an application for attachment before judgment with regard to the amount that is claimed as the arrears. In the said judgment the court held that costs should be so assessed as would reasonably compensate the plaintiff for the loss of time and inconvenience caused by relegating back the proceedings to an earlier stage. However, it was also held that how the terms are to be devised and made a part of the order would depend on the facts and circumstances of the given case and that the court cannot exercise its power to put the defendant on such terms as may have the effect of pre-judging the controversy involved ``` OP(C) NO. 2357 OF 2023 ``` ``` 9 ``` in the suit and virtually decreeing the suit though ex-parte order has been set aside or put the parties on such terms as may be too onerous. 10. In **Narikodan Sathyavalli** (Supra), the Division Bench of this Court held that a direction to deposit a sum of Rs.2,00,000/- for setting aside the ex-parte decree was onerous and directed payment of Rs.2,500/- towards cost. The court relied on the judgment in **G.P.Srivastava** (Supra). In **Peeves Enterprises** (Supra) also the Division Bench has relied on **G.P.Srivastava** (Supra) and modified the condition stipulated by directing a deposit of Rs.25,000/- instead of 25% of the decree amount. 11. The counsel for the respondent relied on the judgment in **Tea Auction Ltd vs Grace Hill Tea Industry And Anr** [2006 KHC 1300] to submit that there is a discretion available to the Court to set aside an ex-parte decree on terms and all that is required is that the terms should not be unreasonable or harshly excessive. The Hon’ble Supreme Court in the said judgment has referred to the judgments in **Karumuri Surayya vs Thadepalli Pushpavalli Thayaramma And Others** [AIR 1950 Madras 618], **Somalal** ``` OP(C) NO. 2357 OF 2023 ``` ``` 10 ``` **Nathalal Mistri vs. The Vasant Investment Corporation Ltd.** [ILR 1954 Bombay 371], **B. Padmavathi Rai vs. Parvathiamma** [AIR 1976 Karnataka 97], **Shyam Lal Sahai v. Ram Narain Lal Seth** [AIR 1920 Pat 660] and other cases, wherein the court has held that the conditions imposed can even be directions to pay a portion of the suit claim or the decretal amount. In the said case on facts, the court found that the direction to furnish security for Rs.37 lakhs either in the form of bank guarantee or in cash was excessive and modified the order by directing furnishing a security to the extent of Rs.5 lakhs. 12. Having heard the counsel and having considered the judgments which have been cited, it is evident that the only question to be looked into is whether the condition imposed in the order of the trial court while setting aside the ex-parte decree, is onerous and excessive. In the case on hand, it is admitted that the defendant was put in possession in May, 2015, though there is a dispute regarding the date of the licence agreement. The licence agreement relied on by the plaintiff is one dated 01.05.2015 between the plaintiff and the defendants while the licence agreement, which has been ``` OP(C) NO. 2357 OF 2023 ``` ``` 11 ``` produced in appeal before this Court by the defendant is one dated 11.05.2015 which is executed between the plaintiff and Metro Leathers Pvt.Ltd. represented by the defendant. However, it would appear that all the clauses in the document are similar, except for the name of the parties. As per the document the licence is to expire on 01.05.2020. 13. According to the petitioner, the entire amount due under the agreement has been paid, after deducting the amounts which were waived by the plaintiff. The suit claim is for Rs.23,20,078.85 and the amount decreed is also the said amount. It is admitted that the defendant is continuing in possession for the past four years without paying any amount either as lease rent or as licence fee. Admitted amount payable was Rs.1,40,000/- per month. 14. It is considering the fact that huge amounts were due from the petitioner to the plaintiff that the court had imposed a condition for deposit of Rs.10 lakhs, which is only about 1/7th of the amount that would be due to the plaintiff going by Ext.P4 agreement. The condition for payment of Rs.10 lakhs is hence not onerous or excessive and is only a very small portion of the amount due. The fact remains that ``` OP(C) NO. 2357 OF 2023 ``` ``` 12 ``` the defendant is still in occupation of the premises. Even if the petitioner had a case that he was prevented by the sufficient cause from appearing before the court, that is not a justification for continuing possession without paying the agreed amount, whether as rental or as licence fee. I do not find any reason to interfere with the direction imposed by the trial court. The original petition fails and is dismissed. The petitioner is given a further time of one month from today to deposit the amount as directed by the trial court. **Sd/T.R.RAVI JUDGE** mpm ``` OP(C) NO. 2357 OF 2023 ``` ``` 13 ``` ## **`APPENDIX OF OP(C) 2357/2023`** ## **`PETITIONER’S EXHIBITS`** ``` Exhibit P1A TRUE COPY OF THE PLAINT IN O.S.NO.17/2021 ON THE FILE OF THE COURT OF SUBORDINATE JUDGE, VATAKARA. ``` ``` Exhibit P2A TRUE COPY OF THE WRITTEN STATEMENT DATED 25.10.2021FILEDBYTHE PETITIONER/DEFENDANT IN O.S.NO.17/2021 ON THE FILE OF THE COURT OF SUBORDINATE JUDGE, VATAKARA. ``` ``` Exhibit P3A TRUE COPY OF THE ORDER DATED 04.09.2023 IN RPIA NO.01/2023 IN O.S.NO.17/2021 ON THE FILE OF THE COURT OF SUBORDINATE JUDGE, VATAKARA. ``` ``` Exhibit P4THE TRUE COPY OF THE LEASE AGREEMENT DATED 11.05.2015 EXECUTED BETWEEN PLAINTIFFS AND METRENDS LATHERS PRIVATE LIMITED. ``` ``` Exhibit P5THE TRUE COPY OF THE JUDGEMENT IN OS. NO. 17/2021 DATED 21.01.2023 OF THE SUB COURT VADAKARA. ``` ``` Exhibit P6THE TRUE COPY OF THE COUNTER STATEMENT FILED BY THE RESPONDENTS IN R.P.I.A. NO. 1/2023 DATED 05.06.2023. ``` ``` Exhibit P7THREE RECENT PHOTOGRAPHS OF THE SCHEDULE BUILDING TAKEN BY THE PETITIONER. ```