1 IN THE HIGH COURT OF JUDICATURE AT MADRAS (ORDINARY ORIGINAL CIVIL JURISDICTION) MONDAY, THE 21ST DAY OF NOVEMBER 2011 THE HON'BLE MR. JUSTICE VINOD K.SHARMA A.No. 5028 OF 2011 IN Tr.C.S. No.998 of 2008 Vira Properties (Madras) Private Limited, Regd.Office at No.781-785, Anna Salai, Chennai 600 002. Rep. by its Executive Director M.R.Pratap, ..Plaintiff. Vs. 1. M/s.Rayala Corporation Pvt. Ltd., Regd. Office at No.144/7 Old Mahabalipuram Road, Kottivakkam, Chennai 600 041 Rep. by its Managing Director Mr.Ranjit Pratap. 2. M/s.Baba Enterprises, No.781, Mount Road, Chennai 600 002 Rep. by its Partner Mr.Senthamilselvan. 3. M/s.Mohan Brewaries and Distrilleries Ltd., Regd.Office at No.112, M M Nagar, Valasarawakkam, Chennai 600 087. Rep. by its Managing Director Mr.N.Nandagopal. ..Defendants. A.No.5028 OF 2011 M/s.Mohan Brewaries and Distrilleries Ltd., Regd.Office at No.112, M M Nagar, Valasarawakkam, Chennai 600 087. Rep. by its Managing Director Mr.N.Nandagopal. ..Applicant https://hcservices.ecourts.gov.in/hcservices/ 2 -Vs.- 1. Vira Properties (Madras) Private Limited, Regd.Office at No.781-785, Anna Salai, Chennai 600 002. Rep. by its Executive Director M.R.Pratap, 2. M/s.Rayala Corporation Pvt. Ltd., Regd. Office at No.144/7 Old Mahabalipuram Road, Kottivakkam, Chennai 600 041 Rep. by its Managing Director Mr.Ranjit Pratap. 3. M/s.Baba Enterprises, No.781, Mount Road, Chennai 600 002 Rep. by its Partner Mr.Senthamilselvan. ... Respondents Application praying that this Hon'ble Court be pleased to extend the time granted to the Applicant Company to obtain an order of Regularisation under Clause 3 of the Consent Decree dated 19.04.2011, by a further period of three months from 17.10.2011 upto 17.01.2012. This application coming on this day before this Court for hearing the court made the following order: This application, by applicant / third defendant, has been filed with a prayer to extend the time to get an order in terms of Clause 3 of consent decree dated 19.04.2011. The applicant prays for further period of three months, to get an order of regularization, from Chennai Metropolitan Development Authority (CMDA). https://hcservices.ecourts.gov.in/hcservices/ 3 2. The case of the applicant / defendant no.3 is that there was a number of litigations between the parties, which was settled by a consent decree on 19.04.2011, in C.S.No.998 of 2008. 3. The operative part of the consent decree reads as under: "3.That upon the defendant obtaining an order of regularization from the Chennai Metropolitan Development Authority for the 8th and 9th floor in Rayala Towers II & III of Rayala Towers on or before 17/10/2011 in terms of G.O.Ms.No.76, Housing and Urban Development (UDI) dated 27/02/1999 (hereinafter referred to as the Regularization Scheme). 4.That in the event the defendant does not obtain the said regularization within time as mentioned in clause (3) supra the plaintiff herein, shall not be liable to pay the additional consideration of Rs.9,00,00,000/- (Rupees nine crores only) and right of the defendant to receive the same stands abated/extinguished and claim of the defendant for the said sum under this decree stands fully discharged. 5.That however in such an event, the plaintiff shall pay sum of Rs.54,67,324/- (Rupees fifty four lakhs sixty seven thousand three hundred and twenty four only) which has been actually expended by the defendant in applying for regularizing the additional construction subject to the same being duly supported by receipts issued by the Chennai Metropolitan Development Authority and also subject to handing over all records drawings and relevant papers in connection therewith to the plaintiff herein. 6.That the plaintiff herein shall be liable to pay the aforementioned sum of Rs.9,00,00,000/- (Rupees nine crores only) forthwith to the defendant within seven (7) days f the aforesaid order of regularization. https://hcservices.ecourts.gov.in/hcservices/ 4 7.That if the plaintiff defaults in making such payment within such time the defendant shall be entitled to execute this clause as a decree for money against the plaintiff herein. 8.That the parties hereto agree to bear their respective costs." 4. The reading of Clause-3 of the consent decree shows that the applicant was required to get an order of regularization from CMDA for 8th and 9th floor in Rayala Towers II and III of Rayala Towers on or before 17.10.2011. The permission was to be obtained in terms of G.O.Ms. 76, Housing and Urban Development (UDI) dated 27.02.1992. 5. It was stipulated in the decree that if the applicant / defendant no.3 fails to get an order of regularization, the plaintiff / non applicant was liable to pay a sum of Rs.9,00,00,000/- (Rupees Nine Crores only) and the right of the applicant / defendant no.3 to receive this amount would stand abated (extinguished). 6. Before expiry of the time stipulated, after regularization order, the applicant / defendant no.3 moved this application for extension of time, on the ground that the applicant / defendant No.3 had moved an application with the competent authority with all necessary documents well within time. It was on account of assembly election in Tamil Nadu that the application submitted by the applicant was not processed in timely manner. The applicant did his https://hcservices.ecourts.gov.in/hcservices/ 5 best and made a number of representations for approval, but could not succeed due to the assembly election. It is submitted that now the application is at final stage, and the order of regularization is likely to be passed by 17.01.2012. 7. The averments made in the affidavit, disclosing delay in grant of regularization, is not disputed, as no counter has been filed by the plaintiff / non applicant to controvert the averments made in support of the application. Learned counsel for the plaintiff / non applicant however contends that the applicant / defendant no.3 has failed to file any documentary evidence in support of averments made in the affidavit. 8. This contention deserves to be noticed to be rejected, as uncontroverted facts are not proved being accepted. 9. Learned Senior Counsel for the applicant / defendant no.3, in support of application, placed reliance on the judgment of the Hon'ble Supreme Court in the case of Mahanth Ram Das Vs. Gangadas, AIR 1961 SCC 882, wherein the Hon'ble Supreme Court has been pleased to lay down as under: "7.The case is an unfortunate and unusual one. The application for extension of time was made before the time fixed by the High court for https://hcservices.ecourts.gov.in/hcservices/ 6 payment of deficit court fee had actually run out. That application appears not to have been considered at all, in view of the peremptory order which had been passed earlier by the Division Bench hearing the appeal, mainly because on the date of the hearing of the petition for extension of time, the period had expired. The short question is whether the High Court, in the circumstances of the case, was powerless to enlarge the time, even though it had peremptorily fixed the period for payment. If the Court had considered the application and rejected it on merits, other considerations might have arisen; but the High Court in the order quoted went by the letter of the original order under which time for payment had been fixed. Section 148 of the Code, in terms allows extension of time, even if the original period fixed has expired, and s.149 is equally liberal. A fortiori, those sections could be invoked by the applicant, when the time had not actually expired. That the application was filed in the vacation when a Division Bench was not sitting should have been considered in dealing with it even on July 13, 1954, when it was actually heard. The order though passed after the expity of the time fixed by the original judgment, would have operated from July 8, 1954. How undesirable it is to fix time peremptorily for a future happening which leaves the Court powerless to deal with events that might arise in between, it is not necessary to decide in this appeal. These orders turn out, often enough to be inexpedient. Such procedural orders, though peremptory (conditional decrees apart) are, in essence, in terrorem, so that dilatory litigants might put themselves in order and avoid delay. They do not, however, completely estop a Court from taking note of events and circumstances which happen within the time fixed. For example, it cannot be said that if the appellant had started with the full money ordered to be paid and came well in time but was set upon and robbed by thieves on the day previous, he could not ask for extension of time, or that the Court was powerless to extend it. Such orders are not like the law of the Medes and the Persians. Cases are known in which Courts have moulded their practice to meet a situation such as this and to have restored a suit or proceeding, even though a final order had been passed. We need cite only one such case, and https://hcservices.ecourts.gov.in/hcservices/ 7 that is Lachmi narain Marwari v. Balmakund Marwari [I.L.R.(1925) 4 Pat 61]. No doubt, as observed by Lord Philimore, we do not wish to place an impediment in the way of Courts in enforcing prompt obedience and avoidance of delay, and more than did the Privy Council. But we are of opinion that in this case the Court could have exercised its powers first on July 13, 1954, when the petition filed within time was before it, and again under the exercise of its inherent powers, when the two petitions under s.151 of the Code of Civil Procedure were filed. If the High Court had felt disposed to take action on any of these occasions, Sections 148 and 149 would have clothed them with ample power to do justice to a litigant for whom it entertained considerable sympathy, but to whose aid it erroneously felt unable to come. 10. Learned Senior Counsel for the applicant has also placed reliance on the Judgement of the Hon'ble Supreme Court in the case of Smt. Periyakkal and Ors. Vs. Smt. Dakshyani, AIR 1983 SC 428, wherein the Hon'ble Supereme Court was pleased to lay down as under: "5.In a case before us, the situation is totally different. Unlike the case of Hukam chand V.Bansilal where there was a statutory compulsion to confirm the sale on the dismissal of the application under Order XXI Rule 90 and, therefore, postponement and further postponement of the confirmation of the sale could only be by the consent of the parties in the case before us, there was no statutory compulsion to dismiss the application under order XXI, Rule 90 in the absence of an agreement between the parties, This court would have then decided the appeal arising out of the application on merits. The parties, however, entered into compromise and invited the court to make an order in terms of the compromise which the court did. The time for deposit stipulated by the parties became the time allowed by the court and this gave the court the jurisdiction to extend time in approprite cases. Of course, time would not be extended ordinarily, nor for the mere asking. It would be granted in https://hcservices.ecourts.gov.in/hcservices/ 8 rare cases to prevent manifest injustice. True the court would not rewrite a contract between the parties but the court would relieve against a forfeiture Clause; And, where the contract of the parties has merged in the order of the court, the court's freedom to act to further the ends of justice would surely not stand curtailed. Nothing said in Hukamchand's case militates against this view. We are, therefore, of the view that the High Court was in error in thinking that they, had no power to extend time, Even so, Shri Jawali submitted that this was not an appropriate case for granting any extension of time. We desire to express no opinion on that question. The High Court will decide that question. We accordingly, set aside that judgement dated 15h January,1979, of the High Court and direct the High Court to dispose of I.A.No.VIII in Execution Second Appeal No.89/74 in accordance with law. The parties will bear their own costs." 11. Reliance was also placed by the learned Senior Counsel on a judgment of the Hon'ble Division Bench of this Court in the case of Canara Bank, Asset Recovery Management Branch Versus Coromandel Indag Products and others in W.P.No.22170 of 2007 decided on 05.10.2007, wherein the Hon'ble Division Bench of this Court, by following the judgment of the Hon'ble Supreme Court, held that this Court can extend the time fixed under the consent decree. This Court again in the case of S. Ravindra Reddy vs. K.Veerabhadrachari, 1999 (2) MLJ 251 reiterated the same view. 12. Further reliance, by the learned Senior counsel for the applicant / defendant no.3, was placed on a https://hcservices.ecourts.gov.in/hcservices/ 9 Judgement of this Court in the case of A. Balakumar Versus The Director of Technical Education passed in W.A.No.175 of 2008 decided on 17.04.2008, wherein the Hon'ble Division Bench of this Court was pleased to lay down as under: "7.It has not been disputed that the admission of the petitioner has not yet been cancelled and he is still pursuing study in the college. The question of approval of admission by the Director of Technical Education, Government of Tamil Nadu will arise only when the University issues a provisional eligibility certificate. The University has not accepted the certificate, which has been obtained by the petitioner much later on by the order of the court, merely on the ground that the court has not extended further time. Taking into consideration the aforesaid fact, particularly when the petitioner is still pursuing study in the college in question and when his admission has not yet been cancelled and that he applied within time after the order of the court, but because of delay by the Embassy he could not produce the certificate within time, we are of the view that the petitioner should be given opportunity to produce all those documents before the University." The reliance on this judgment was in support of the contention that discretionary relief of extension of time, should be granted in favour of the applicant, when no fault can be attributed for non performance of application submitted by the applicant. 13. This application is opposed by the learned counsel for the non-applicant, by contending that the judgement of the Hon'ble Supreme Court in the case of Smt. Periyakkal and Ors. Vs. Smt. Dakshyani (supra), cannot be https://hcservices.ecourts.gov.in/hcservices/ 10 said to be a binding precedent in view of subsequent judgment of the Hon'ble Supreme Court, in the case of Gupta Steel Industries vs Jolly Steel Industries Pvt. Ltd. and another, 1996 (11) SCC 678, laying down as under: "6. As principle of law, the High Court was obviously in correct in interfering with and modifying the consent decree unless parties agree for the same. Though it is contended by Shri Bhimrao Naik, learned Senior Counsel for the appellants, that the High Court has no power after the expiry of the period to extend the time for the compliance on the facts and circumstances, we do not think that we would be justified to interfere with this order at this distance of time. However, as regards the direction to make payment of compensation, we do not think that it would be appropriate at this stage to give any finding; however, the trial Court is directed to conduct an enquiry whether the appellant was prevented by the acts of the respondents to remain in possession and work out the factory. In the event of the finding being recorded that the appellant was prevented by the acts of the respondent for working out the factory, the appellant will not be liable to pay damages whatsoever. On the other hand, if it is found that the appellant had worked out the factory in view of the fact that the High Court had granted the order of status quo, we think that they are liable to pay @ Rs.2500 p.m." 14. The contention of the learned counsel for the plaintiff / non applicant was that this Court, without consent of the parties, does not have the jurisdiction to extend the time. It is also the contention of the learned counsel for the non applicant that as per the settled law of precedent , the later judgment of the Co-ordinate Bench of the Hon'ble Supreme Court is to be followed in preference to the previous judgment. https://hcservices.ecourts.gov.in/hcservices/ 11 15. It was next contended that Section 148 of the Civil Procedure Code stood amended by imposing restriction against extension of time beyond 30 days, therefore, this application deserves to be rejected, being barred under Section 148 of CPC. 16. Learned Senior Counsel for the applicant, to controvert the argument raised by the learned counsel for the non applicant, placed reliance on a judgment of the Hon'ble Bombay High Court in the case of The Blind Relief Association and others vs. The State of Maharashtra and Others in 2000 (3) MHLJ 372, laying down as under: "16.In the case of "Periyakkal" it has been held that the Court has the power to extend the time to obviate manifest injustice. The Supreme Court was however cautioning limitation of the Court when it observed that the Court would not re-write the contract between the parties but the Court would relieve against a forfeiture clauses and where the contract of the parties has merged in the order of the Court, the Court's freedom to act to further the ends of justice would surely not stand curtailed. The reasoning by the Supreme Court appears to be good law even today. Subsequent decision of the Supreme Court in "Gupta Steel"MANU/SC/1791/1996: (1996) 11SCC678, however, has not declared that the observation in "Smt.Periyakkal" case was wrong. Argument of the learned counsel for the plaintiff, Mr.Seervai that "Smt.Periyakkal" case deemded to have been overruled in "Gupta Steel" case cannot be accepted, firstly, both the decisions were rendered by two Judges Bench. Therefore, "Gupta Steel" cannot overrule "Periyakkal" going by the rule of judicial discipline. Secondly, on the face of the judgement in "Gupta Steel", it did not refer to"Smt. Periyakkal" case at all. The https://hcservices.ecourts.gov.in/hcservices/ 12 Periyakkal case was also of the view that in normal case, the consent decree can not be altered without the consent of the parties. It only stated that the Court is powerless to obviate failure of justice especially when the party in default is not consciously responsible for failure to act according to the consent decree. According to me on a close examination of these two decisions of the Supreme Court, I am of the view that these two decisions are not in conflict to each other. Both the decisions recognized the principle that in normal case the Court will not alter the terms of consent decree without the consent of the parties. But, in an abnormal circumstances, where it appears to the Court that without the interference of the Court, a serious miscarriage of justice can not be obviated, when certainly this Court can exercise its inherent power under Section 151 of Code of Civil Procedure and save the sufferers from deflection refraction of justice." 17. The reading of pleadings and judgments, on which reliance was placed, settled law, which emerges, is that the consent decree when passed, is deemed to be an order of Court, and the Court, therefore, can grant extension of time for performance to do substantial justice. 18. It is also well settled that the Court, to do substantial justice between parties, can exercise its inherent jurisdiction. 19. In the case in hand, the controverted averments made in the affidavit show that no fault can be found with the applicant / defendant no.3, in filing application to get an order of regularization. The applicant tried to honor the consent decree and it was on account of the act https://hcservices.ecourts.gov.in/hcservices/ 13 of third party, which is not under the control of applicant, that the delay has occurred in getting an order of regularization. The applicant, therefore, cannot be allowed to suffer on account of lapses on the part of the Government agencies, in failing to perform its functions diligently and expeditiously. 20. The contention of the learned counsel for the plaintiff / non applicant, that in view of judgment of the Hon'ble Supreme Court in the case of Gupta Steel Industries vs Jolly Steel Industries Pvt. Ltd. and another (supra), this Court has no jurisdiction to extend the time, cannot be accepted. In view of settled law, that a decision is authority for what it actually and explicitly decides, and not what logical flows from it. 21. In this background, it may be noticed that the Hon'ble Supreme Court in the case of Smt. Periyakkal and Ors. Vs. Smt. Dakshyani (supra), decided the question of extension of time by Court. Whereas in Gupta Steel Industries vs Jolly Steel Industries Pvt. Ltd. and another (supra), only passing reference has been made, therefore, the judgment Gupta Steel Industries vs Jolly Steel Industries Pvt. Ltd. and another (supra), cannot be said to be binding precedent. The Hon'ble Bombay High Court also held that the judgment of the Hon'ble Supreme Court in https://hcservices.ecourts.gov.in/hcservices/ 14 Gupta Steel Industries vs Jolly Steel Industries Pvt. Ltd. and another (supra)is not contrary to the earlier view of the Hon'ble Supreme Court. 22. The provisions of Section 148 of the Code of Civil Procedure again cannot be a bar to exercise the inherent jurisdiction to do substantial justice between parties. It is therefore in the interest of justice that time be extended as prayed for. 23. Consequently, this application is ordered. No costs. Sd/-V.K.S.J 21.11.2011 //Certified to be a true copy// Dated this the day of 2011. R.s/12.12.2011 COURT OFFICER From 25.09.2008 the Registry is issuing certified copies of the Order/Judgment Decree in this format. https://hcservices.ecourts.gov.in/hcservices/