C. Subramaniam vs Tamil Nadu Housing Board

Judgement pronounced by A.S. Venkatachalamoorthy, J.—Plaintiff in C.S.No.1643 of 1992 on the file of the High Court, Madras, who is

the respondent in application No.3640 and 3641 of 1994 is the appellant herein.

In respect of an extent of 2141 sq.ft which is commercial vacant site adjacent to HIG block No.1/1 at Rajaram Colony, Kodambakkam,

Madras-24, the Tamil Nadu Housing Board conducted auction on 22.7.1987. The appellant herein was the highest bidder having offered

Rs.3,25,000 per ground and the area in question being less than a ground, proportionately the price was fixed at Rs.2.89.927. As per the

conditions of auction, the plaintiff paid 15% of the cost viz., 48,490 apart from EMD of Rs.5,000 which he paid earlier on 20.7.1987. On

12.11.1987, the Housing Board passed an order of confirmation and balance of the plot cost payable was Rs.2,41,437. Admittedly, this

confirmation letter was sent by the Housing Board to the appellant/plaintiff and he was called upon to pay the balance amount within the stipulated

period of three months.

The appellant/plaintiff laid the suit contending that though he received the confirmation letter referred supra, only in February 1990 he received

the lease-cum-sale agreement and till then he did not have the opportunity of knowing the exact terms and conditions of the auction sale in his

favour. The appellant also raised a plea that he made repeated requests to the Board to grant him permission to make piecemeal payment of

balance cost of plot and only by letter dated 17.4.1990 he was informed that his request was rejected and that the appellant should pay the entire

balance amount with interest before 30.4.1990. The appellant further contended that he paid a sum of Rs.50,000 through cheque dated 26.4.1990

and requested the Board to grant a period of six months for making full payment. The time was extended only upto 15.5.1990 and therefore the

appellant by his letter dated 15.5.1990 appealed to the respondent herein for extending the time. It is further stated in the plaint that the time was

extended upto 30.6.1990 for making full payment and it was also made clear that if the appellant fail to make the payment as stipulated, the auction

sale shall stand automatically cancelled.

The further case of the appellant herein is that he received the letter only few days before 30.6.1990 and in fact he sent a cheque for Rs.50,000

on 5.7.1990 and by letter dated 6.7.1990 requested the Board to revise the earlier order and extend the time further for making full payment. The

appellant herein has further averred in the plaint that notwithstanding his request, he received a letter dated 4.10.1990 from the respondent that the

auction sale in favour of the plaintiff was cancelled with effect from 30.6.1990 and his cheque dated 5.7.1990 was also returned. It is the case of

the appellant that the time is not essence of the contract and this is evident from the number of letters of the Board which only made it clear that the

delayed payment would attract interest. It is also the case of the appellant herein that though initially a period of three months was tentatively fixed

by the Board, this requirement was subsequently waived by receiving a sum of Rs.50,000 through cheque dated 26.4.1990 nearly two years after

the auction sale was over. The specific case of the appellant is that the contract was concluded on 12.11.1987 and he would be entitled to pay the

balance plot cost and perform his part of the contract within the statutory period of three years viz., before 11.11.1990.

Against the order of cancellation received by him, on 4.10.1990 the appellant herein filed an appeal before the Government and also obtained

interim stay. This suit came to be filed by the appellant herein even during the pendency of the appeal before the Government. The prayer that is

sought for by the appellant herein is one for specific performance of the contract for sale dated 12.11.1987 by directing the defendant to execute

and register the sale deed in favour of the plaintiff in respect of suit property and for other reliefs.

There is no dispute that summons were served on the respondent herein and as no written statement was filed by the defendant, the case was

listed in the undefended Board on 10.11.1993. There was no representation on behalf of the respondent and consequently it was set ex parte and

a decree was passed. The appellant on 3.2.1994 deposited a sum of Rs.1,91,437 which according to him would represent the balance of sale

consideration and subsequently on 2.3.1994 he sent a notice to the Board informing about the decree already passed by the Court and the deposit

made by him. Appellant also filed E.P.78 of 1994 for which also notice was ordered and sent to the Board.

The respondent herein filed an application to set aside the ex parte order along with an application to condone the delay in filing the same viz..

Application Nos.3640 and 3641 of 1994. In support of the said application, an affidavit was filed by the Clerk by name Manoharan of the then

counsel. In the said affidavit it is slated that by oversight the case which was listed on 10.11.1993 was not noticed and with the result there was no

representation on behalf of the respondent herein, when the case was called and that the failure to represent was neither wilful nor wanton.

The appellant herein inter alia resisted the application contending that the respondent even after receipt of summons never cared to file written

statement in the suit and on 10.11.1993 the matter was posted in the list and as there was no representation on its behalf the learned single Judge

decreed the suit ex parte. Serious objection was taken for the Advocate''s clerk by name K.Manoharan filing affidavit, who was not a recognised

clerk of the then counsel of the respondent.

It is also contended therein that the appellant deposited the balance consideration on 3.2.1994 and also sent a notice to the Housing Board on

2.3.1994 and that there was gross and inordinate delay on the part of the respondent to file the application and that such gross negligence on the

part of a person would disqualify and disentitle the respondent to seek for any discretionary relief. A specific mention is made to the effect that the

affidavit filed in support of the application though was signed on 2nd February, the same was filed only in the month of March i.e., after a month''s

delay for which there is no explanation.

Pending disposal of the application Nos.3640 and 3641 of 1994, the appellant herein took out an application No.1906 of 1998 for producing

K.Manoharan, the deponent of the affidavit filed in support of the application to condone the delay in setting aside the ex parte decree, for cross-

examination. On behalf of the respondent, one Sri.M.Seenu, the Executive Engineer and Administrative Officer of K.K.Nagar division. Housing

Board filed a detailed counter affidavit setting out the various facts right from the date when the respondent received the summons and till filing of

the counter affidavit. In the said counter affidavit, it is stated that it has no control over the clerk of the erstwhile counsel appeared and it would not

be possible for it to produce the said Manoharan for the purpose of cross-examination.

The learned single Judge after elaborately considering the materials on record, came to the conclusion that it cannot be said that the ex parte

decree was passed due to any carelessness or negligence on the part of the respondent and the suit was allowed to be decreed ex parte only

because the counsel engaged by the respondent was not prompt in filing written statement in time. The learned single Judge further found that

serious lapses cannot be attributed to the Board because it had kept quiet after entrusting the matter to its counsel and it was only the counsel who

failed to do his duty and did not promptly appear in Court and only as a result of which ex parte decree came to be passed. Finally, the learned

single Judge came to the conclusion that if the ex parte decree is allowed to become final in spite of the fact that the respondent/Board has shown

sufficient reason, it will result in substantial miscarriage of justice. The learned single Judge also gave specific finding that there was absence of

negligence, inaction and mala fides on the part of the respondent/Board and for the inconvenience caused to the appellant, learned Judge thought it

fit to award cost of Rs.500.

Being aggrieved by the order of the learned single Judge in application Nos.3640 and 3641 of 1994, the present appeals have been filed by

the appellant.

The learned counsel for the appellant submitted that inasmuch as the witness viz., Sri.Mathimaran, an assistant of respondent/Board working in

K.K.Nagar Division has categorically deposed in his evidence that the Housing Board did not authorise Manoharan, clerk of the then advocate to

file affidavit on its behalf and what all stated in the affidavit of Manoharan are not true, there are no pleadings as such in those applications and that

being so, the Court should not have acted on the oral evidence of Mathimaran and allowed the applications.

As narrated above, the suit in C.S.No.1643 of 1992 was listed on 10.11.1993. As on that date, there was no representation for the

respondent, the learned single Judge decreed the suit ex parte. Thereafter the applications Nos.3640 and 3641 of 1994 were filed to condone the

delay in filing application to set aside the ex parte decree and to set aside the ex parte decree respectively. Both the applications as well as the

affidavit filed in support of the applications are dated 2nd February, 1994. It appears, that the then counsel of the Board though knew about the ex

parte order on 2nd February, 1994, did not inform the Board. Probably the said counsel would have thought that he could manage by asking his

clerk by name Manoharan to file an affidavit in support of those applications. It was only on 2.3.1994 when the Housing Board received the notice

from the appellant came to know about the ex parte order. Of course, it is true in the enquiry by the learned single Judge, the respondent examined

Mr.Mathimaran, one of its staff who deposed that the said Manoharan was not authorised to file the said affidavit. In these circumstances now it is

contended by the learned counsel for the appellant that there is no pleading that the respondent/Board with reference to these applications and in

those circumstances the Court should not have acted on the evidence of Mathimaran and allowed the applications.

The pleadings such as plaint, written statement, affidavit, counter affidavit, as the case may be, are filed, for the parties to know the case of

each other and which would enable parties to defend their respective case. Now the question in this case is. can it be said that the respondent was

not aware about the stand of the appellant with reference to those applications. The answer is no. This is because the appellant filed an application

No.1906 of 1998 for producing K.Manoharan, the deponent of the affidavit for cross-examination. In that application, the Executive Engineer and

the Administrative Officer of K.K.Nagar Division, Tamil Nadu Housing Board filed a detailed counter affidavit setting out the case of the

respondent/Board. That was filed way back in July 1998. Hence it cannot be said that the appellant was taken by surprise or that he was not

aware about the stand of the Respondent/Board. Though it has to be taken that there was no affidavit filed in support of those applications, it

cannot be said that it has caused any hardship to the appellant. Courts are to render substantial justice and technicalities should not stand in the

way.

In this connection we would like to refer to a ruling of the Apex Court reported in Collector, Land Acquisition, Anantnag and Another Vs.

Mst. Katiji and Others, , wherein the Supreme Court laid down that the Court should adopt liberal approach in dealing with the applications filed

u/s 5 of the Limitation Act. In fact, in paragraph 3 of the Judgment, the Supreme Court observed that a liberal approach is adopted on principle as

it is realized that:-

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When substantial justice and technical considerations are pitied against each other, cause of substantial justice deserves to be preferred for the

other side cannot claim to have vested right in injustice being done � because of a non-deliberate delay.

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It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of

removing injustice and is expected to do so.

In Bank of India Vs. Lakshimani Dass and Others, , the Supreme Court laid down as under

...In a case where the facts are writ large and the parties go to trial on the basis that the claim of the other side is clearly known to them, we fail to

understand as to how lack of pleadings would prejudice them.

In Mahabir Prasad Singh Vs. M/s. Jacks Aviation Private Ltd., , the Supreme Court while considering the scope of High Court''s jurisdiction

u/s 151 of Code of Civil Procedure, observed thus,

... Thus, even if such an order passed by the subordinate court has any illegality or is affected by material irregularity, the High Court will not

interfere unless the said order, if allowed to stand would occasion a failure of justice or its effect would be infliction of irreparable injury to any

party.

As far as the present case is concerned, we are of the opinion that if for any reason the order of the learned single Judge is to be set aside, then

it will result in failure of justice and consequently would result in injury and loss to the respondent. The respondent''s stand is that as per the

conditions of auction and lease-cum-sale agreement, the appellant is liable to pay several lakhs, assuming for the sake of the argument that the

order of cancellation is wrong.

The next contention raised by the learned counsel for the appellant is that the respondent failed to satisfy the Court that there was sufficient

cause for the Court to condone the delay.

The Tamil Nadu Housing Board decided to conduct a Public auction on 22.7.1987 and in that regard due publication was given both in the

newspapers as well as by putting up necessary notice in the notice board. The said advertisement clearly spelt out the conditions of auction. As per

the conditions, a participant should pay Rs.5,000 as EMD. The conditions of auction also explained about the method of sale and method of

payment. According to the same, the highest bidder had to pay 15% immediately after the auction and the balance amount of 85% less EMD to be

paid within three months from the date of receipt of confirmation letter. Here in this case, even according to the appellant, he received the

confirmation order on 18.11.1987 and he was waiting for the lease-cum-sale agreement and in fact he sent reminders in that regard. There is yet

another averment in the plaint that since the lease-cum-sale agreement was not supplied or executed for a long time, he did not have the

opportunity of knowing the exact terms and conditions of the auction sale in his favour. In the plaint, in para 5, the appellant has stated that he

made repeated requests to the Board to permit him to make piecemeal payment of the balance of plot cost with interest but however only on

17.4.1990 he was informed by the respondent that the request for piecemeal payment was rejected and that he was called upon to pay the entire

plot cost with interest before 30.4.1990. Stopping here for a moment, prima facie we are not inclined to accept this part of the case of the

appellant for various reasons. Firstly, even public notice relating to the auction sale clearly spelt out that the successful bidder should pay the

balance of 85% less EMD within three months after receipt of confirmation order. Here in this case, the appellant received the confirmation order

on 18.11.1987. That being so, for the appellant to say that he was waiting for lease-cum-sale agreement to know the terms and conditions of the

auction cannot be believed. Secondly, he has not disclosed in the plaint at to when he made request for making piecemeal payment. As already

pointed out the auction was over even in 1987 and first payment was made, according to the appellant, on 26.4.1990, a sum of Rs.50,000. Suffice

for us to say, prima facie we are of the opinion that the appellant cannot pretend that he has been complying his part of the contract without any

lapses. That apart, the plot in question is a commercial plot in a busy locality. The appellant would contend that the time is not the essence of the

contract. Anyhow, all the above aspects have to be gone into at the time of trial and we are not expressing any opinion on that.

In this case, after receiving summons, the respondent addressed a letter on 19.3.1993 requesting its then standing counsel to enter appearance

on its behalf in the suit and also gave necessary vakalat. The copy of the said letter is marked as Ex. PI. Again, in May, 1993, the respondent sent

a letter to its then counsel enclosing parawar remarks for preparing counter to contest the interim application, copy of which is marked as Ex.P2. A

third letter was also sent, copy of which is marked as Ex.P3 dated 19.8.1993, requesting the counsel to take necessary steps to get the stay order

vacated. Rightly, the respondent after duly taking necessary steps by sending vakalat, parawar remarks to its standing counsel was waiting for

further instructions/ communications from its then counsel. The Board was not informed by its then counsel about the hearing on 10.11.1993 or

subsequent thereto about the developments in the case, even after the said counsel came to know on 2nd February, 1994. It was only on 3rd

March, 1994 when the Housing Board received the notice from the counsel for the appellant herein, it came to know about the ex parte order, by

which time the Board''s then counsel already filed applications to set aside the ex parte decree. So it cannot be said that the Board had acted

negligently much less gross negligently or was guilty of culpable negligence. The above narration would only show that if at all anybody to be

blamed, it is only the then standing counsel of the Board. From the records available, it is clear that the Board has changed its counsel in 1995. We

may also point out that in fact there was no suggestion put to Mathimaran, the witness examined on behalf of the respondent to the effect that the

respondent was aware about the order dated 10.11.1993 before it received the notice from the counsel for the appellant oh 2.3.1994.

We are of the view that the Board has shown sufficient cause for the delay in filing the application to set aside the ex parte decree against it. It

cannot be said that the respondent acted mala fide or adopted delaying tactics for whatever may be the purpose or reason. We are fully satisfied

that in the facts and circumstances of the case, if the delay is not condoned and the ex parte decree is set aside, it will result in gross miscarriage of

justice and consequently there will be failure to advance substantial justice.

Let us refer to few decisions, which set out the correct legal position.

In Shakuntala Devi Jain Vs. Kuntal Kumari and Others, , the Apex Court ruled thus,

Section 5 gives the Courts a discretion which in respect of jurisdiction is to be exercised in the way in which judicial power and discretion ought to

be exercised upon principles; the words ""sufficient cause"" receiving a liberal construction so as to advance substantial justice when no negligence

nor inaction nor want of bona fides is imputable to the appellant...

In The State of West Bengal Vs. The Administrator, Howrah Municipality and Others, the Supreme Court again ruled to the same effect and

to quote the exact wordings,

From the above observation it is clear that the words ""sufficient cause"" should receive a liberal construction so as to advance substantial juslice

when no negligence or inaction or want of bona fide is imputable to a party.

In paragraph 37 of the said Judgment, the Supreme Court proceeded further to observe, thus,

... But, as pointed out by the Judicial Committee in AIR 1937 276 (Privy Council) if a party had acted in a particular manner on a wrong advice

given by his Legal Adviser, he cannol be held guilty of negligence so as to disentitle the party to plead sufficient cause under S.5 of the Limitation

Act. In fact the Judicial Committee observes as follows:

Mistaken advice given by a legal practitioner may in the circumstances of a particular case give rise to sufficient cause within the section though

there is certainly no general doctrine which saves parties from the results of wrong advice.

In Collector, Land Acquisition, Anantnag and Another Vs. Mst. Katiji and Others, . Justice Thakkar observed thus,

The legislature has conferred the power to condone delay by enacting S.5 of the Indian Limitation Act of 1963 in order to enable the Courts to do

substantial justice to parties by disposing of matters on ''merits''. The expression ""sufficient cause"" employed by the legislature is adequately elastic

to enable the Courts to apply the law in a meaningful manner which subserves the ends of justice that being the life-purpose for the existence of the

institution of Courts, it is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But

the message does not appear to have percolated down to all the other Courts in the hierarchy. ...

G. Ramegowda, Major and Ors Vs. Special Land Acquisition Officer, Bangalore, deals with a case where the reference Court passed a

common award in a batch of land acquisition matter on 17.7.1970. Application for certified copies was made on 31.8.1971. The copies were

obtained on 5.1.1972. One appeal was filed on 19.1.1972 and other two appeals were preferred on 10.4.1972. There was substantial delay in

preferring the appeals and the State Government virtually blamed the Government Pleader. In fact, in that case, Government took the stand that the

delay was occurred on account of the fraud played by the concerned Government Pleader and because of which Government lost crores of

rupees. The High Court condoned the delay and adverting to the conduct of the Government Pleader, the High Court observed thus,

But how could the L.A.O. anticipate that the Government Pleader would fail to do such elementary duties like applying for such certified copies,

obtaining them and forwarding them to the Government with his opinion. To say the least, the conduct of the Government Pleader/and/or the

Assistant Government Pleader appears to us to be extraordinary.

It was contended before the Supreme Court that, the High Court committed manifest error in condoning the inordinate and wholly unjustifiable

delay in filing the appeals. The Supreme Court in that context referred to an order already passed by it in a similar context where the delay had

been condoned by the High Court, and observed thus,

Having regard to the entirety of the circumstances, the High Court thought that the State should not be penalised for the lapses of some of its

officers and that in the particular circumstances there were sufficient grounds justifying the condonation of delay in filing the appeals. It was a matter

for the discretion of the High Court. We are unable to say that the discretion was improperly exercised.......

Earlier in paragraph 8, the Supreme Court observed thus,

In litigations to which Government, is a party there is yet another aspect which, perhaps, cannot be ignored. If appeals brought by Government

are lost for such defaults, no person is individually affected; but what, in the ultimate analysis, suffers is public interest. The decisions of Government

are collective and institutional decisions and do not share the characteristics of decisions of private individuals.

The law of limitation is, no doubt, the same for a private citizen as for Governmental authorities. Government, like any other litigant must take

responsibility for the acts or omissions of its officers. But a somewhat different complexion is imparted to the matter where Government makes out

a case where public interest was shown to have suffered owing to acts of fraud or bad faith on the part of its officers or agents and where the

officers were clearly at cross-purposes with it.

In N. Balakrishnan Vs. M. Krishnamurthy, , the Supreme Court was considering Section 5 of the Limitation Act, 1963 as well as the powers

of revision u/s 115 of Code of Civil Procedure. In that case, the Apex Court pointed out that want of extra vigilance need not be used as a ground

to depict him as a litigant not aware of his responsibilities, and to visit him with drastic consequences. It is further pointed out that once the court

accepts the explanation as sufficient it is the result of positive exercise of discretion and normally the superior court should not disturb such finding,

much less in revisional jurisdiction, unless the exercise of discretion was on wholly untenable grounds or arbitrary or perverse. We deem it

necessary to quote paragraphs 12 to 14 from the said judgment in extenso, which read thus,

Rules of limitation are not meant to destroy the right of parties. They are meant see that parties do not resort to dilatory tactics, but seek their

remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life span

for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time

newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each

remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded

on public policy. It is enshrined in the maxim interest reipublicae up sit finis litium (it is for the general welfare that a period be put to litigation).

Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their

remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time.

A Court knows that refusal to condone delay would result in foreclosing a suitor from putting forth his cause. There is no presumption that

delay in approaching the court is always deliberate. This court has held that the words ""sufficient cause"" u/s 5 of the Limitation Act should receive a

liberal construction so as to advance substantial justice vide Shakuntala Devi Jain Vs. Kuntal Kumari and Others, and The State of West Bengal

Vs. The Administrator, Howrah Municipality and Others, .

It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to

turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is put-forth as part of a dilatory strategy

the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party

deliberately to gain lime then the court should lean against acceptance of the explanation. While condoning delay the Court should not forget the

opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be

a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party of

his loss.

In G.P. Srivastava Vs. Shri R.K. Raizada and Others, , the Apex Court had to examine in that case whether sufficient cause was shown for

setting aside the ex parte decree. In that case, the Apex Court observed as under;

...Even if the appellant was found to be negligent, the other side could have been compensated by costs and the ex parte decree set aside on such

other terms and conditions as were deemed proper by the trial Court. .............

The ends of justice can be met only if the appellant-defendant is allowed opportunity to prove his case within a reasonable time.

To turn up the legal position,_ (1) the word ""sufficient cause"" should receive liberal construction to do substantial justice; (2) what is ""sufficient

cause"" is a question of fact in a given circumstances of the case; (3) it is axiomatic that condonation of delay i-s discretion of the Court; (4) length

of delay is no matter, but acceptability of the explanation is the only criterion; (5) once the Court accepts the explanation as ""sufficient"", it is the

result of positive exercise of discretion and normally the superior court should not disturb in such finding unless the discretion was exercised on

wholly untenable or perverse. (6) The rules of limitation are not meant to destroy the rights of the parties but they are meant to see that the parties

do not resort to dilatory tactics to seek their remedy promptly. (7) Unless a party shows that he/she is put to manifest injustice or hardship, the

discretion exercised by the lower Court is not liable to be revised. (8) If the explanation does not smack of mala fides or it is put forth as part of a

dilatory strategy, the court must show utmost consideration to the suitor. (9) If the delay was occasioned by party deliberately to gain time, then the

court should lean against acceptance of the explanation and while condoning the delay, the Court should not forget the opposite party altogether.

As far as the present case is concerned, we are clearly of the opinion that there was no negligence on the part of the respondent and at best it

can only be said that it was not extra vigilant. This we are saying so because once the Government owned Corporation or Board have a standing

counsel in the Court and fulfils its duty by sending vakalat and instructions to its counsel, there is complete justification in it waiting for further

instruction or communiction from its counsel.

For all the above reasons, we are of the clear view that the learned single Judge is right in, arriving at the various findings. There are no merits

in these appeals.

In the result, both the appeals are dismissed. No costs. Consequently, C.M.P.Nos.14411 and 14412 of 1999 are also dismissed.