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Kuldip Oil Industries Ltd. Vs. Ch. Pratap Singh - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad High Court
Decided On
Case NumberFirst Appeal No. 7 of 1948
Judge
Reported inAIR1959All505
ActsBengal Agra and Assam Civil Courts Act, 1887 - Sections 15 and 15(3); High Court Rules and Order; General (Civil) Rules, 1952 - Rule 19; Negotiable Instruments Act, 1882 - Sections 25; Code of Civil Procedure (CPC) , 1908 - Order 9, Rule 13 - Order 20, Rule 4; Civil Courts Act, 1887
AppellantKuldip Oil Industries Ltd.
RespondentCh. Pratap Singh
Appellant AdvocateD. Sanyal, Adv.
Respondent AdvocateP.N. Katju, Adv.
DispositionAppeal allowed
Excerpt:
civil - court holiday - section 15 of bengal, agra and assam civil courts act, 1887 - ex parte order by a court below on a close holiday can be vacated - order vacated and the court as a rule of universal application do not function on close holidays. - - 3. the plaintiff alleged that in consequence of the misrepresentation of kuldip singh aforesaid as representing the defendant company and because of failure of the defendant to carry out the conditions precedent on which the plaintiff agreed to purchase the shares of the defendant company and because of misrepresentation made by the defendant company through the said kuldip singh, the plaintiff finally served a lawyer's notice dated 25-5-1946 on the defendant company demanding refund of rs. 5. summonses were caused to be issued in the..........and the reasons for the decision.the second contention is that 2-10-1947 was a holiday for the civil courts in the district of dehra dun and, therefore, the court below should not have passed an order on that date directing that the case should proceed ex parte and it should not have recorded the plaintiff's evidence and should not have heard the plaintiff's argument and given judgment on that day. the prayer is that this court, should, therefore, set aside the order directing the ex parte hearing of the case and in consequence should also set aside the judgment and decree which have followed the ex parte hearing and should remand this case to the court below with a direction that it should be heard and decided on merits after fixing a fresh date for the filing of the defendant's.....
Judgment:

1. This is an appeal by M/s. Kuldip Oil Industries the defendant in the suit. The plaintiff Ch. Pratap Singh filed the suit claiming a sum of Rs. 12,500/- as principal plus Rs. 114/-as interest at the rate of 6 per cent, per annum from 8-1-1946 to 16-7-1947, in all Rs. 13,641/- with pendente lite and future interest and also the cost of the suit.

2. The case of the plaintiff was that Kuldip Singh, one of the Directors of the defendant company approached the plaintiff early in January, 1946 for the purchase of shares of the defendant company on the distinct understanding,

(a) that the plaintiff would be taken in as one of the promoter Director of the company.

(b) that the prospectus of the company was very promising and it was being floated without any liability whatsoever; and

(c) that it belonged primarily to members of the Ahluwalia Community, to which both the plaintiff and Kuldip Singh belonged and the directorate would invariably consist of the same; that on the basis of the above representation and assurances the plaintiff advanced Rs. 12,500/- by cheque on the 8th January 1946 and left the choice of shares to the said Kuldip Singh, that a few days after the plaintiff sent a telegram to the defendant reiterating the bases of the offer of purchase of shares by him, that the said Kuldip Singh by a telegram dated 15-1-1940, informed the plaintiff that he had been accepted as Director and congratulated the plaintiff, that the defendant sent a communication to the plaintiff dated 16-3-1946, purporting to be an allotment letter demanding the balance i.e., Rs. 12,500/- only from the plaintiff, thus intending to complete the transaction of sale of 1.00 preference shares of Rs. 100/- each, 1,000/- ordinary shares of Rs. 10/- each and 1,000/-, deferred shares of Rs. 5/- each in favour of the plaintiff, that the said Kuldip Singh purporting to act on behalf of the defendant sent another communication to the plaintiff dated 25-3-1946 enclosing a form to be filled up and to be returned by the plaintiff to the defendant purporting to be a declaration of consent to act as Director in the defendant company; that in reply the plaintiff wrote to the defendant to send the plaintiff the company's Memorandum and regulation before the plaintiff finally made up his mind to become a share-holder or not, that the defendant in. reply sent printed copies of the Memorandum of Association Articles and the Managing Agency Agreement without mentioning the names of the subscribers to these documents; that the plaintiff demanded by letters dated 5-4-1946 and 18-4-1946 certain particulars before he could finally decide whether he should become a member of the defendant company: that the particulars required were:

(a) the date of in corporation of the company,

(b) the prospectus of the company;

(c) a certified copy of the resolution co-opting the plaintiff as a director, and that the defendant did not comply with the plaintiff's request made in the above three clauses, but sent a copy of the resolution co-opting his as a director.

3. The plaintiff alleged that in consequence of the misrepresentation of Kuldip Singh aforesaid as representing the defendant company and because of failure of the defendant to carry out the conditions precedent on which the plaintiff agreed to purchase the shares of the defendant company and because of misrepresentation made by the defendant company through the said Kuldip Singh, the plaintiff finally served a lawyer's notice dated 25-5-1946 on the defendant company demanding refund of Rs. 12,500/-, with interest and that the defendant refused to comply with the same.

4. In consequence the plaintiff filed the present suit on 18-7-1947 claiming the relief already indicated.

5. Summonses were caused to be issued in the suit to the defendant and from the endorsed copy thereof, which is on the record, we find that it was served on one Sant Prasad, the Manager and Mukhtar-e-am of the defendant company at Ambala on 19-8-1947. The receipt of the summons has been acknowledged in his own hand-writing by the said Sant Prasad, as will appear from endorsed copy of the summons and there is also the affidavit of the process server to the same effect.

6. This summons was a summons for the settlement of issues and it directed the production of all documentary evidence on which the defendant wished to rely. The summons gave notice that in default of appearance on the date mentioned in the summons namely, 2-10-1947, the suit would be heard and determined in the defendant's absence.

7. On the date fixed namely 2-10-1947, the defendant was absent and the order-sheet shows that the court recorded an order that the suit would proceed ex parte as against the defendant. The court further ordered that the plaintiff's statement may be recorded. Thereafter, Pratap Singh, the plaintiff went into the witness box and gave his deposition and by his evidence he also proved certain documents filed by him. Thereafter, the Court passed a short judgment in the following words;

'This is a suit for the recovery of Rs. 13,641 on the allegations that the defendants' agent induced the plaintiff to purchase shares of the defendant company by misrepresenting that the plaintiff would be appointed a promoter director. The representations made by the defendant's agent were found to be false and the plaintiff, therefore, claims refund of the money paid to the defendant together with interest.

The defendant is absent.

The claim is proved. The plaintiff is, however not entitled to recover interest from the defendant.

ORDER

Suit for the recovery of Rs. 12,500/- is decreed ex parte with costs and six per cent, pendente lite and future interest.

Sd. R. Singh,

Civil Judge,

Dehra Dun,

2-10-1947.'

8. A decree was drawn up in terms of the Judgment. Thereafter on 5-1-1948, this first appeal was preferred from that judgment and decree by the defendant.

9. It also appears from an application dated 10-12-1947 that the defendant made an application under Order 9, Rule 13 of the Civil Procedure Code praying that the ex parte decree passed against the defendant be set aside and the suit be proceeded with in accordance with Jaw. The said application was supported by an affidavit. It appears from the order sheet relating to this application that a notice thereof was ordered to go to the plaintiff for the 14th of February, and after some adjournments, on the 26th of April, 1948, the defendant's aforesaid application for restoration dated 10-12-1947 was dismissed for default with costs.

10. In this appeal the learned counsel for the appellant has argued two points before us. Firstly, he has submitted that the judgment of the court below does not fulfil the requirements of Order 20, Rule 4 (2) of the Civil Procedure Code, inasmuch as it does not contain a concise statement of the case, the points of determination and the reasons for the decision.

The second contention is that 2-10-1947 was a holiday for the Civil Courts in the district of Dehra Dun and, therefore, the court below should not have passed an order on that date directing that the case should proceed ex parte and it should not have recorded the plaintiff's evidence and should not have heard the plaintiff's argument and given judgment on that day. The prayer is that this Court, should, therefore, set aside the order directing the ex parte hearing of the case and in consequence should also set aside the judgment and decree which have followed the ex parte hearing and should remand this case to the court below with a direction that it should be heard and decided on merits after fixing a fresh date for the filing of the defendant's defence.

11. We will first briefly indicate what was the legal position on 2-10-1947.

12. Section 15(a) of the Bengal, Agra and Assam Civil Courts Act, 1887 (Act No. XII of 1887) prescribes as follows:

(i) Subject to such orders as may be made by the State Government, the High Court shall prepare a list of days to be observed in each year as close holidays in the civil courts.

(ii) the list shall be published in the Official Gazette;

(iii) a judicial act done by a Civil Court on a day specified in the list shall not be invalid by reason only of its having been done on that date.'

13. It appears that the High Court had drawn up a list of days to be observed as close holidays in the lower courts for the year 1947 and that pursuant to Section 15 of the Bengal, Agra and Assam Civil Courts Act, that list of close holidays was duly published in the Gazette, but that list did not indicate that 2-10-1947 would be a close holiday in connection with the birthday of Mahatma Gandhi.

14. By a notification No. 4659/III-III 1946, dated Lucknow 26-9-1947 the Government of the United Provinces in exercise of the powers conferred by Section 25, Negotiable Instruments Act, 1882 (Act No. XXII of 1 882) which by virtue of Government of India, Home Department, Notification No. 228/38 public dated 1-4-1938, are excrcisable by provincial governments, declared Thursday, 2-10-1947, a public holiday for the whole of the United Provinces on account of the birthday of Mahatma Gandhi. This notification was sent to the High Court which then issued a circular letter to all District Judges and all presiding Officers of the Civil Courts subordinate to the High Court of Judicature at Allahabad on 28-9-1947, drawing attention to the instructions issued by the Government on the Subject of the celebration of Mahatma Gandhi's birthday on 2-10-1947 and directing that 2-10-1947 would be observed as a close holiday.

On the 29-9-1947 this Court also sent express telegrams to all courts including the Dehra Dun Court intimating that the 2nd of October, had been declared a holiday and that Mahatma Gandhi's birthday should be suitably celebrated.

15. We may point out that these facts have been gathered from the relative file kept in the office of the High Court and are now accepted by parties to this appeal as correct. No notification was published in the official gazette under Section 15 of the Bengal, Agra & Assam Civil Courts Act 1887 declaring the 2nd October 1947 as a close holiday, presumably because there was no sufficient time to do so.

16. It is necessary to point out that a notification under Section 25 of the Negotiable Instruments Act docs not by its own force operate to declare a day as a close holiday under the Bengal, Agra & Assam Civil Courts Act. Normally when a day is declared to be a holiday under the provisions of Section 25 of the Negotiable Instruments Act, this Court also falls in line with such a notification and takes steps to have the day in question declared a holiday also for the civil courts subordinate to it.

17. We have already quoted Section 15 of the Civil Courts Act and it will be observed that Sub-section (3) of that section does not invalidate the judicial act done by a civil court on a day specified in the list as a close holiday under Sub-clause (1) to that section. We may however point out that the General Rule (Civil) framed by this Court for the subordinate courts prescribes in Chapter XX, Rule 19 as follows:

'Without the consent of parties and in the absence of urgent necessity no civil trial shall proceed on a close holiday provided that on a close holiday the court shall not refuse to do any act or make any order urgently required which may with propriety be done or made out of Court.'

18. The above rule clearly indicates that there is to be consent of parties and there is to be an urgency. It also indicates by the proviso that the court shall not refuse to do any act or make any order urgently required.

19. The question therefore, which arises is whether the court below in passing an order that this case should proceed ex parte on the 2nd of October, was acting in accordance with the Bengal, Agra and Assam Civil Courts Act and the rules framed by this Court. As has already been indicated the 2nd of October, although it had been declared to be a holiday, was not notified as such in the Official Gazette as required by Section 15, Sub-clause (2) of the said Act, so as to attract in terms the provisions of Sub-clause (3) of the Act; but even so, we think that the spirit of the section demands that 2-10-1947 must undoubtedly be treated as being a close holiday so far as the courts subordinate to this Court were concerned. Moreover in our view, Rule 19, Chapter 20 is attracted in this case and the court should not have proceeded to pass an order that the case would be disposed of ex parte on 2-10-1947 because there was no urgent necessity to do so and because the consent of the defendant was not available. The clear intention of Rule 19 of Chapter 20 of the Rules of the Court is that only a matter of extreme urgency may be dealt with on a close holiday. Section 15 (3) of the Bengal, Agra and Assam Act also is by way of indemnity rule i. e. to say it validates a judicial act which would otherwise be invalidated. But from the language of Section 15 (3) of the last mentioned Act it does not follow that as a general rule the Courts are entitled to perform all judicial acts on close holidays,

20. Therefore, in our view, the court below exercised a wrong discretion in passing an order that the case would proceed ex parte on the 2nd of October and in thereafter recording evidence and pronouncing judgment. For these reasons it appears to us that the judgment and decree of the court below would have to be set aside. We may point out that we are not exercising the powers which are conferred under the Code by Order 9, Rule 13 of the Civil Procedure Code in this case.

We are not setting aside the ex parte decree as ex parte decree. What we are doing is that we are setting aside the order directing that the case should proceed ex parte and having done that we are proceeding to make an order of an ancillary nature in the interest of justice that the judgment and decree passed by the court below should stand vacated, for the court was in error in directing that the case be dealt with ex parte on a day declared to be a holiday by the High Court. In the circumstances stated above the Court's further action in recording evidence and proceeding to give judgment has also got to be set aside,

21. In our view the question whether the defendant was or was not in default and whether an order could have been made that the case be proceeded ex parte should not have been considered on 2-10-1947 which was a close holiday and on which day only urgent matters were liable to be disposed of outside the court as provided under Chapter XX, Rule 19 of the rules of this Court. Sitting in court to determine whether the suit should proceed ex parte as against the defendant and in proceeding to record evidence, the court was exercising a power which it did not have. Every thing mat it has done on 2-10-1947 must be deemed to be a nullity and therefore, liable to be set aside upon that ground.

22. Apart from what we have stated above we conceive that it must be a rule of universal application that courts do not function on close holidays except for the purpose of discharging the most urgent business. We are not, therefore, inclined to allow a transgression of this well known principle in this case. Merely because the plaintiff chose to appear on a close holiday, he cannot be permitted! to take the advantage of the process of the court and to get a judgment ex parte in his favour.

23. We will test the matter further. If the plaintiff had not put in appearance on the 2nd of October, which day was a close holiday, would the court have been justified in dismissing the suit for want of prosecution? The answer must surely be in the negative. The same rule must apply to the defendant. In the circumstances we think that it almost amounts to permitting an abuse of the process of the court to allow the decree in this case to stand. The decree will, therefore, have to be set aside and the case will have to nbe sent back to the court below to be proceeded with after due notice to parties from the point at which the defendant was to put in appearance in response to the summons. The Court will fix a fresh day on which day the defendant will be expected to comply with the requirements of the summons already issued to him.

24. We may now deal with the other point that the judgment of the court below in this case does not fulfil the requirements of law.

25. Brevity may be the soul of wit, but brevity must not be taken to the point to which it has been taken by the court below. The statement of the facts of the case is concise to a degree. It is not apparent from the judgment as to what the points of determination were. There is no discussion whatsoever of any oral or documentary evidence, nor are the conclusions that the plaintiff's suit shall stand decreed supported by any reasoning whatsoever. In the circumstances we would have been at least compelled to send the case back for a fresh judgment, because the learned counsel for the appellant has very rightly remarked that he is expected to attack the reasoning of a judgment in appeal and not merely the formal expression of the adjudication. In the view that we are taking the case goes back as a whole.

26. In the end we may note that in this appeal an order was passed on 7-9-1954 to the effect that the respondent having failed to pay the amount due by him in respect of translation and printing charges he would not, as provided by Chapter XIII, Rule 11 of the Rules of Court, be heard in the appeal, it would proceed ex parte against him. The previous order of this court has been carried into effect by us and we have not heard the learned counsel for the respondent, even though Mr. P. N. Katju, learned counsel far the respondent made a request to be heard. His request could not be granted in view of the earlier order of this Court! and also because even upto this date there has been no payment of the deficiency of the sum of Rs. 192/9/- due in respect of printing and translation charges.

27. The result is that we allow this appeal,set aside the judgment and decree of the courtbelow and send the case back to the court belowfor disposal in accordance with law and in the lightof the observations herein before made; the costsherein and hitherto will abide the result.


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