Civil Revision No.5251 of 2007 : 1 : IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Civil Revision No. 5251 of 2007 Date of Decision: May 30, 2008 M/s.Punjab Beverages Pvt.Ltd. Having its Registered Office at: 35, New Lal Bagh Colony, Patiala ...Petitioner VERSUS M/s G.T.Agencies, a registered partnership firm, having its Office at Show Room No.51, Sector 26, Madhya Marg, Chandigarh ...Respondent CORAM: HON'BLE MR.JUSTICE RANJIT SINGH 1. Whether Reporters of local papers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? Present: Mr.A.S.Chandhiok, Senior Advocate with Mr.D.S.Narula, Ms.Manmeet Arora, Ms.Geetika Panwar, and Mr.Aashish Chopra, Advocate, for the petitioner. Mr.Ashok Aggarwal, Senior Advocate with Mr.Pritam Saini, Advocate, for the respondent. ***** RANJIT SINGH, J. Closely related family members, who were working together in a concern known as `Coca Cola' are litigating in this case, Civil Revision No.5251 of 2007 : 2 : one of which has got an ex-parte decree in his favour for recovery of an amount approximately Rs.five crores . The petitioner would cry foul and say that this has been obtained by a fraud which is apparent on the face of the record and the same would need to be rectified immediately by this court while exercising jurisdiction under Article 227 of the Constitution of India. Values in our society have undergone a sea-change and it is money which seems to have foremost consideration. It matters not if in the bargain one puts at stake close relatives, like brother, sister or in-law. A simple application seeking direction for the court, which is dealing with an issue of setting-aside ex-parte decree and judgment, has led to an interesting and a significant debate in regard to scope of Article 227 of the Constitution of India specially in the background where allegations of fraud are made. The facts when noticed in the case would bring out the alleged aspect of greed involved in this case, which the petitioner has termed as a fraud on the part of the respondent. At issue is an ex-parte decree dated 23.12.2005 passed in favour of respondent M/s G.T.Agencies, a registered partnership firm having its office at Show Room No.51, Sector 26, Madhya Marg, Chandigarh for recovery of Rs.5,67,54,376-29P. Petitioner alleges that this decree has been obtained by fraud and would refer to the facts here-in-after noticed in support of the allegations. The petitioner on coming to know about the same has filed an appeal against this ex-parte decree through which recovery of above-noted amount of more than Rs.5-1/2 crores is allowed. Petitioner claims that the appeal is filed within thirty days of acquiring the knowledge about the Civil Revision No.5251 of 2007 : 3 : decree and thus this appeal is instituted within time. It is stated that as a matter of abandoned precaution, the petitioner has filed an application under Section 5 of the Limitation Act seeking condonation of delay of 455 days, though the appeal is otherwise within a period of limitation from the date of knowledge of the decree. On 24.8.2007, District Judge, Chandigarh has framed issue whether there is sufficient ground to condone delay in filing the appeal and fixed the case for evidence. The petitioner felt aggrieved against the same and has invoked the jurisdiction of this court under Article 227 of the Constitution for setting-aside of the order dated 24.8.2007 as referred to above. The grievance is that the application seeking condonation of delay filed under Section 5 of the Limitation Act would not need any oral evidence for the purpose of being decided as according to the petitioner, the facts in this case are so glaringly apparent from the record indicating fraud and which are not in much dispute and so would not require any adjudication but an order condoning the delay paving way for deciding the appeal on merits. Shortly after framing the issues and when the case was listed on 24.9.2007, the respondent herein filed an application for framing an additional issue regarding the competency of a person filing the application under Section 5 of the Limitation Act. The court, after receiving reply to this application, viewed that issue about the locus of Ajit Singh son of late Shri Daljit Singh to file the application and appeal would arise and accordingly framed an additional issue in this regard. Further directions were issued in the said order on an application moved by the respondent that the minutes book of applicant-company since July 1992 till May, 2007 may also be Civil Revision No.5251 of 2007 : 4 : brought by applicant-Director Ajit Singh at the time for cross- examination of the witness, if these are available with the petitioner. This order perhaps has ignited the cause and grievance of the petitioner for them to challenge the same as well as the order dated 24.8.2007. To properly appreciate the background in which the allegations of fraud are made, it will be essential to make a brief reference to the suit which led to passing of this ex-parte decree. Respondent, a partnership firm, filed a suit No.43 of 2005 on 5.5.2005 before Civil Judge, Chandigarh for recovery of the amount noted in the foregoing paragraphs along with interest against the petitioners, who are arrayed as defendants. It is pleaded in the suit that defendant-company had taken a loan from the plaintiff firm and had secured the same by deposit of title deeds with respect to Plot No.179, Industrial Area-I, Chandigarh by way of equitable mortgage. Respondent-partnership consists of Lt.Col.A.S., Smt.Surinder Ajit Judge, Smt.Nagina, Smt.Shah E Naaz and Kuljeet Singh Sehgal. Apparently, it is a family partnership concern of Col.A.S.Judge. Smt.Surinder Ajit Judge, being his wife, and Smt.Nagina and Smt.Shah E Naaz, his two daughters. The petitioner has placed on record the copy of Form `A', which gives particulars of the partnership firm and the same is dated 4.5.2005. One day after registration, suit is filed on 5.5.2005, Col.A.S.Judge is also the General Manager of petitioner-company, i.e., M/s Punjab Beverages Pvt.Ltd. Respondent partnership concern sued the petitioner- company at three addresses mentioned in the suit and these are: 9, Friends Colony, New Delhi, Administrative Office at 8/32, Kirti Nagar, New Delhi and Factory at Plot No.180, Industrial Area, Chandigarh. Civil Revision No.5251 of 2007 : 5 : The summons in this suit was effected upon the petitioner-company, which is defendant in the suit, through its General Manager, who is none other than Col.A.S.Judge, managing partner of the respondent- plaintiff partnership concern. He accepted the summons and engaged a counsel Shri D.V.Mehta, who appeared on behalf of the petitioner-company in the suit. Shri D.V.Mehta, Advocate filed his Vakalatnama and entered appearance on behalf of the petitioner- company in the said suit on 16.7.2005. The petitioner has placed on record a typed copy of Vakalatnama executed by Lt.Col.A.S.Judge in favour of Shri D.V.Mehta authorising him to appear on behalf of the petitioner-company. This document is on record as Annexure P-3. After appearing in the case on 2.8.2005, Advocate D.V.Mehta absented and did not appear on the next date of hearing, i.e, 20.8.2005. The petitioner company, accordingly was proceeded ex- parte. What a way to get decree in a suit?. Col.A.S.Judge is the managing partner of respondent- partnership concern, which had filed this suit. He gets a notice issued on to himself and engages a counsel, who appears on one day and thereafter abstain and does not even appear. The trial court holds an ex-parte proceeding and decrees the suit vide judgment and decree dated 23.12.2005. Col.A.S.Judge makes no effort to inform the court that he is a managing partner of the plaintiff concern and has himself engaged a counsel on behalf of the defendant. The court has also made no efforts to acquaint itself with such a glaring infirmity. These facts are not in much dispute. The respondent concern now relies on one technicality or the other, whereas the Civil Revision No.5251 of 2007 : 6 : petitioner would loudly proclaim it to be a clear case of fraud, which is writ large. The petitioner would call for immediate intervention and correction of this fraud. It is not disputed that the summons in this case was not served on the defendant company (petitioner) but only on the General Manager, who himself is a plaintiff in the suit. The petitioner never learnt about this decree and statedly came to know of it on 17.3.2007, when some real estate agent approached the petitioner for information in respect of a plot No.179-80 Industrial Area, Chandigarh. From the agent, Mr.Ajit Singh Director of the petitioner- company learnt that property was being sold in pursuance to the execution proceedings pending before Civil Judge, Chandigarh. The petitioner-company immediately rushed and filed an application under Order 9 Rule 13 CPC before the trial court seeking setting- aside of the ex-parte judgment and decree. The petitioner- company also filed an appeal within a period of thirty days from the date of obtaining knowledge and as a matter of precaution, as already noticed, filed an application under Section 5 of the Limitation Act. It is, thus, pleaded by the petitioner-company that fraud is writ large in this case and there is no requirement of framing issue or receiving evidence. The ex-parte decree would require immediate setting-aside and the suit is required to be properly adjudicated as per law. According to the petitioner, rather than appreciating this fact the Appellate Court had framed an issue in regard to the locus of Ajit Singh in filing this appeal and the application. The plea of the petitioner as projected is stoutly opposed by the respondent. As already noticed, the respondent would base its Civil Revision No.5251 of 2007 : 7 : case on pure technicalities. It is first submitted that the prayer made in the petition is limited and is to the effect that there is no requirement of receiving oral evidence for setting-aside the ex-parte order and accordingly the order framing additional issue and directing the petitioner to produce minutes of meeting etc. need not to be set- aside. Mr.Aggarwal, counsel representing the respondent would say that the prayer made in the revision being limited prayer, issues agitated can not be gone into. Mr.A.S.Chandhiok, representing the petitioner, on the other hand, would plead that the fraud in this case is so apparent and clear from the record itself and hence this would be a fit case to exercise jurisdiction under Article 227 of the Constitution, so that this fraud is set right to enable the petitioner to prosecute their respective lis afresh in the suit. This ensued a debate in regard to scope of Article 227 of the Constitution between the parties. Mr.Chandhiok would plead that scope of this Article is so wide, even wider than Article 226, and hence on detection of fraud, the court should suo moto interfere to set right this fraud. In response, Mr.Aggarwal would say that no such objection was made before the courts below and accordingly there cannot be a suggestion that court has not considered any such submission which was made. The counsel seems to be contending that the petitioner did not plead before the Appellate Court that the application be decided on the basis of fraud as alleged and that no issue in this regard be framed. Mr.Aggarwal would further say that he is expected to answer the prayer made in the petition and that the scope of this petition cannot be enlarged as suggested by Mr.Chandhiok. He would further say that if it is required to be done, Civil Revision No.5251 of 2007 : 8 : then the respondent has to be put to notice and till that is not done, the respondent is not obliged to answer the pleas as are being raised. Of course, Mr.Chandhiok in answer would draw attention of the court to various documents and the orders passed to show that the respondent is on a proper notice concerning the allegation of fraud and he is now wanting to escape from the inevitable which is directly staring at him. As per the learned counsel, the respondent's hands are smeared with a fraud and he would not deserve any hearing as this court would have ample power to interfere and set right this fraud so as to avoid justice being polluted. No doubt, the prayer made in the present petition is for setting-aside the ex-parte order dated 24.8.2007 on the ground that in the facts and circumstances of the case, the issue regarding condonation of delay does not require leading of any oral evidence. Prayer further is for setting-aside the ex-parte order dated 24.9.2007. Prayer also is to call for the record of civil appeal and that of a suit and dispose of the application under Section 5 of the Limitation Act on the basis of documents available before the trial court on record. It is in this context that debate about the scope of Article 227 ensued when Mr.Chandhiok pleaded that this court must set right the fraud to convey a clear message that a person who approaches the court to practice fraud cannot be allowed to take advantage thereof. To justify the action of the petitioner in filing application under Order 9 Rule 13 CPC for setting aside the ex-parte decree and simultaneously filing the appeal against the said ex-parte decree, the counsel for the petitioner has referred to the decision of Supreme Court in the case of P.Kiran Kumar Vs. A.S.Khadar and others, Civil Revision No.5251 of 2007 : 9 : (2002) 5 Supreme Court Cases 161. As per the law laid down in this case, prior to the date of explanation added under Order 9 Rule 13, a defendant burdened with an ex-parte decree could apply under Order 9 Rule 13 for setting aside ex-parte decree and could also file an appeal under Section 96 against the said ex-parte decree. It is also observed that mere fact of filing the appeal did not take away the jurisdiction to entertain and dispose of an application for setting aside an ex-parte decree and that only in the cases in which the trial court decree merged with the order of the appellate court by reversal, confirmation or varying it, the trial court was precluded from setting aside the ex-parte decree. It has now been viewed that the legislative attempt incorporating the Explanation to Order 9 Rule 13 is to confine the defendant to either one of the remedies available to him and not both. In this regard, a reference is also made to the case of Rani Choudhary v. Lt.Col.Suraj Jit Choudhary, (1982) 2 SCC 596 and to Bhanu Kumar Jain Vs. Archana Kumar and another, (2005) 1 Supreme Court Cases 787, where it is held that it is permissible to a party against whom an ex-parte decree is passed to file an application under Order 9 Rule 13 and appeal under Section 96 CPC apart from filing a review petition and a suit for setting aside the ex-parte decree on ground of fraud. It is further held that if appeal against an ex-parte decree is dismissed, then in view of the Explanation to Order 9 Rule 13, the application under Order 9 Rule 13 would not be maintainable. As observed by the Hon'ble Supreme Court, the converse though is not true, that is, dismissal of the application under Order 9 Rule 13, does not imply that the appeal against the ex-parte decree would not be maintainable. Further if the Civil Revision No.5251 of 2007 : 10 : application under Order 9 Rule 13 is dismissed, then the defendant can file an appeal there against under Order 43 Rule 1 (d). In regard to the sweep and scope of Article 227 of the Constitution, the counsel would first refer to the case of Roshan Deen Vs. Preeti Lal, (2002) 1 Supreme Court Cases 100. It is viewed by the Hon'ble Supreme Court that purpose of powers conferred on the High Court under Articles 226 and 227 of the Constitution is to advance justice, not to thwart it. It is further observed that even where justice is the by-product of an erroneous interpretation of law, the High Court ought not to wipe out such justice in the name of correcting error of law. This is a case where a person has claimed compensation for Rs.7 lakhs before the Commissioner of Workmen's Compensation, who had received injuries in his neck, hands and legs while operating machine and he got trapped in the shaft. While the case was being prosecuted before the Compensation Commissioner, it was stated by the respondent concerned that an agreement has been reached and the workman would not be appearing. The Commissioner allowed the application and dismissed the claim as settled and withdrawn. The workman thereafter filed an application stating that the deception had been carried out and that he had never entered into any agreement with the management. Strangely, the respondent management also denied if there was any agreement which was against the earlier stand taken by it and thus the Commissioner set-aside his own order for deciding the matter on merits. Against this order, the respondent concerned approached the High Court, which set aside the order passed by the Commissioner by holding that he had recalled and reviewed his own order, which Civil Revision No.5251 of 2007 : 11 : may not be permissible. The workman had then gone the Hon'ble Supreme Court, which felt so concerned and observed that it made very telling observation by expressing itself as follows:- “We are greatly disturbed by the insensitivity reflected in the impugned judgment rendered by the learned Single Judge in a case where judicial mind would be tempted to utilize all possible legal measures to impart justice to a man mutilated so outrageously by his cruel destiny. The High Court non-suited him in exercise of a supervisory and extraordinary jurisdiction envisaged under Article 227 of the Constitution. Time and again this court has reminded that the power conferred on the High Court under Articles 226 and 227 of the Constitution is to advance justice and not to thwart it (vide State of U.P. v.District Judge, Unnao). The very purpose of such constitutional powers being conferred on the High Courts is that no man should be subjected to injustice by violating the law. The lookout of the High Court is, therefore, not merely to pick out any error of law through an academic angle but to see whether injustice has resulted on account of any erroneous interpretation of law. If justice became the by-product of an erroneous view of law the High Court is not expected to erase such justice in the name of correcting the error of law.” In case of Surya Dev Rai Vs. Ram Chander Rai and others, (2003) 6 Supreme Court Cases 675, the court has gone into the effect of amendment carried out in Section 115(1) of CPC on Civil Revision No.5251 of 2007 : 12 : Articles 226 and 227 of the Constitution and has held that the amendment cannot and does not in any manner affect the jurisdiction under Articles 226 and 227. It is further held that being part of the basic structure it cannot be tampered, not even by a constitutional amendment much less by any Act of legislature. It is, thus, held that the party can, therefore, seek such writ of certiorari or invoke power of superintendence of High Court notwithstanding the amendment carried out of Section 115 of CPC. In this case only, the Supreme Court has gone in detail in regard to differences in jurisdiction under Articles 226 and 227 of the Constitution. Talking about the scope of Article 227, the Hon'ble Supreme Court has observed that this Article is administrative as well as judicial, and is capable of being invoked at the instance of any person aggrieved or may even be exercised suo moto. According to the Supreme Court, the paramount consideration behind vesting such wide power of superintendence in the High court is paving the path of justice and removing any obstacles therein. It is further viewed that power under Article 227 is wider than the one conferred on the High Court by Article 226 in the sense that power of superintendence is not subject to those technicalities of procedure or additional fetters which are to be found in certiorari jurisdiction. The Hon'ble Supreme Court has then noticed that differences in jurisdiction between Articles 226 and 227 to note that writ of certiorari is an exercise of its original jurisdiction, whereas exercise of supervisory jurisdiction is not an original jurisdiction in that sense and it is akin to appellate, revisional or corrective jurisdiction. It is further noticed that in exercise of supervisory jurisdiction, the High Court may not only quash or set aside the Civil Revision No.5251 of 2007 : 13 : impugned proceedings, judgment or order, but it may also make such directions as the facts and circumstances of the case may warrant, may be by way of guiding the inferior court or tribunal as to the manner in which it would now proceed further or afresh as commended to or guided by the High Court. The power available with the High Court to be exercised in appropriate cases while exercising supervisory jurisdiction to substitute such a decision of its own in place of the impugned decision, as the inferior court or the tribunal should have made is also recognised by the Hon'ble Supreme Court. It is in this context it is observed that supervisory jurisdiction is capable of being exercised suo moto as well, whereas jurisdiction under Article 226 is capable of being so exercised on a prayer made by aggrieved party. Reference has also been made to the case of B.C.Chaturvedi Vs. Union of India and others, (1995) 6 Supreme Court Cases 749 and to the observations made that mere fact that there is no provision parallel to Article 142 relating to the High Courts can be no ground to think that they have not to do complete justice, and if moulding of relief would do complete justice between the parties, the same cannot be ordered. It is held that absence of provision like Article 142 is not material. The High Courts too can exercise power of review, which inheres in every court of plenary jurisdiction. Power to do complete justice also inheres in every court, not to speak of a court of plenary jurisdiction like a High Court. My attention has also been drawn to case of Ashok Kumar Gupta and another Vs. State of U.P. And others, (1997) 5 Supreme Court Cases 201 in this regard, to urge that the phrase “complete justice” Civil Revision No.5251 of 2007 : 14 : engrafted in Article 142(1) is the word of width couched with elasticity to meet myriad situations created by human ingenuity or a cause or a result of operation of statute law or a law declared under Articles 32, 136 and 141 of the Constitution and cannot be cribbed or cabined within any limitations or phraseology. It has rightly been observed by the Hon'ble Supreme Court that each case needs examination in the light of its backdrop and the indelible effect of the decision. In the ultimate analysis, it is for the court to exercise its power to do complete justice or prevent injustice arising from the exigencies of the cause or matter before it. Mr.Chandhiok would also refer to the observations made by the Hon'ble Supreme Court in the case of Balwinder Kaur Vs. Hardeep Singh, (1997) 11 Supreme Court Cases 701. In this case, High Court dismissed the appeal filed by appellant- wife against the order of divorce passed in favour of her husband, which according to the wife, had been obtained by pratising fraud on the wife. The High Court dismissed the appeal summarily by saying that if any fraud has been pratised on the applicant, the