Case Note & Summary
The case involves an appeal filed by the Shipping Corporation of India Ltd. (original defendant No.1) against an exparte decree dated 8th June 2006 passed by a learned Single Judge of the Bombay High Court in Suit No.962 of 1981. The original plaintiff, Nirlon Synthetic Fibres & Chemicals Ltd., had filed the suit against the appellant (defendant No.1), the National Insurance Company Ltd. (defendant No.2), and Tulsidas Khimji Pvt. Ltd. (defendant No.3) seeking recovery of amounts for loss of goods. The plaintiff alleged that it had appointed defendant No.3 as a clearing agent for consignments of drums containing Monoethylene Glycol, and some drums were damaged. The plaintiff sought a decree against the appellant for Rs.1,16,144.55 with interest at 18% per annum, and against defendant No.2 for Rs.4,00,164.89 with similar interest. The suit proceeded exparte against the appellant, and the learned Single Judge passed an exparte decree. The appellant challenged the decree on the ground that it was not duly served with the summons in the suit. The Division Bench of the Bombay High Court, consisting of Dr. S. Radhakrishnan and S.J. Vazifdar, JJ., heard the appeal. The court examined the service of summons and found that the process server's report indicated service on an employee of a different entity, not the appellant. The court held that the appellant was not served with summons, and therefore, the exparte decree was liable to be set aside. The court allowed the appeal, set aside the exparte decree, and remanded the suit to the learned Single Judge for fresh hearing on merits. The court directed that the suit be heard afresh and disposed of as expeditiously as possible.
Headnote
A) Civil Procedure - Service of Summons - Order 5 Rule 12 Code of Civil Procedure, 1908 - Validity of Service on Employee at Registered Office - The court examined whether service of summons on an employee of the defendant at its registered office constitutes valid service. The court held that service on an employee at the registered office is sufficient compliance with Order 5 Rule 12 CPC, as the defendant company is deemed to have received notice. However, in this case, the court found that the appellant was not served at all, as the process server's report indicated service on a different entity. (Paras 1-5) B) Civil Procedure - Exparte Decree - Setting Aside - Order 9 Rule 13 Code of Civil Procedure, 1908 - Grounds for Setting Aside - The court considered whether an exparte decree can be set aside when the defendant was not duly served. The court held that if the defendant was not served with summons, the exparte decree is liable to be set aside, as the defendant was prevented from appearing due to lack of notice. The court allowed the appeal and set aside the exparte decree, remanding the suit for fresh hearing. (Paras 6-10)
Issue of Consideration
Whether the exparte decree passed against the appellant (original defendant No.1) was liable to be set aside on the ground that the appellant was not duly served with the summons in the suit.
Final Decision
Appeal allowed. Exparte decree dated 8th June 2006 set aside. Suit remanded to learned Single Judge for fresh hearing on merits. Parties to appear before the learned Single Judge on 7th August 2006. Suit to be disposed of as expeditiously as possible.
Law Points
- Service of summons on defendant's employee at registered office is valid under Order 5 Rule 12 CPC
- Exparte decree set aside if defendant not duly served
- Appeal against exparte decree maintainable under Order 43 Rule 1(d) CPC
