UNION BANK OF INDIA Vs. CANNON INDUSTRIES

JUDGEMENT

(1.) THIS Notice of Motion has been taken out for setting aside the ex parte decree and the order passed on 18th February, 1997. A prayer is also made for condonation of delay in taking out the Notice of Motion, if any. Affidavit in reply taken on record.

(2.) MR .Vora, learned Counsel appearing for the defendants, submitted that no service in fact was effected on the defendants in accordance with law. Even when the order was passed on 18th February, 1997 a statement was made by the Counsel for the Plaintiff that the writ of summons has been duly served on the defendants and that affidavit of service is ready and will be filed within a week. Court accepted and recorded the aforesaid statement. Mr.Vora has submitted that the suit came up for directions on 21st June, 1988. No affidavit of service or writ of summons was filed on that day. Thereafter the suit did not come up for ex parte decree on 4th July, 1988, when it was directed to be placed on Board. In fact, the suit did not come up for ex parte decree thereafter till 2nd December, 1996. In the meantime, talks of settlement were going on between the plaintiff and the defendants. On 21st October, 1994 it was confirmed that the Plaintiff Bank have settled the account for a sum of Rs. One lakh. Rs. 25,000/- was to be paid as down payment and Rs.75,000/- to be paid within six months i.e. before March, 1995. The defendants deposited a sum of Rs.20,000/- by two cheques of Rs.10,000/-. The balance was to be paid on or before 31st March, 1995. All these facts were recorded by the letter of defendant No.2 dated 20th December, 1994. This letter was personally acknowledged on the same day i.e.20th December, 1994. On 29th March, 1995 defendant No.2 again wrote to the plaintiff stating that although he had promised to pay the balance amount of Rs.80,000/- by 31st March, 1995, he could manage only Rs.20,000/-. He also stated that the balance Rs.60,000/- would be paid as early as possible. This letter was also personally acknowledged by the Officer of the plaintiff. The defendants, therefore, paid a total sum of Rs.60,000/- leaving a balance of Rs.40,000/-.

(3.) AS against this, Mr.Shah, Counsel appearing for the plaintiff, has submitted that from the admissions of defendant No. 2 in various pleadings and documents, it is evident that the defendants were aware of the pendency of the suit. He further submitted that a perusal of the affidavit of Gulahane, Clerk in the office of the Sheriff of Mumbai, would show that the service had been duly effected on the defendants. He explained away the missing acknowledgment by saying that the same must have been misplaced. With regard to the affidavit of service not being filed within a period of 7 days, he submitted that the affidavit has in fact been filed within 9 days of the order. This, according to the learned Counsel, is a mere irregularity and cannot affect the validity of the ex parte decree. He further submits that Section 27 of the General Clauses Act defines the meaning of service by post. This section presumes that the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post a letter containing the document and unless the contrary is proved to have been effected at the time at which the letter would be delivered in the ordinary course of business. He further submitted that the Notice of Motion is barred by the law of limitation as provided under Article 123 of the Limitation Act.