Case Note & Summary
The dispute arose from a summary suit filed by Sailam BVBA, a Belgian partnership firm, against Helios Jewellery Pvt Ltd (Defendant No.1) and its four directors/guarantors (Defendant Nos.2-5). The plaintiff claimed recovery of Rs.3,67,85,654 as the price of diamonds supplied under four invoices between January and February 2011. The plaintiff alleged that the goods were imported but payment was not made. The defendants admitted receipt but claimed they returned the diamonds to the plaintiff's partner in Mumbai, relying on a delivery challan. The plaintiff denied receiving the goods and alleged forgery of the partner's signature. The suit was filed under Order XXXVII of the Code of Civil Procedure, 1908, as a summary suit based on a written contract. After service of summons and appearance, the plaintiff took out a Summons for Judgment. On 6 March 2014, a learned single Judge passed an order directing the defendants to deposit the entire principal amount in Court within eight weeks as a condition to file written statement, while granting unconditional leave to defend only in respect of interest. The defendants failed to deposit the amount. Consequently, an ex-parte decree was passed on 20 August 2014. The defendants (original Defendant Nos.2-5) then moved Notice of Motion No.1562 of 2015 to set aside the ex-parte decree. By the impugned order dated 16 April 2016, the learned single Judge rejected that application. Aggrieved, the defendants filed the present appeals (Appeal (Lodg.) No.310 of 2016, 309 of 2016, and 311 of 2016) under Section 13 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015. The Division Bench was called upon to decide whether the single Judge's refusal to set aside the ex-parte decree was correct. The excerpt of the judgment provided does not contain the court's final decision on the appeals, and therefore the ratio decidendi remains unavailable from the present text.
Issue of Consideration
Whether the learned single Judge was correct in dismissing the application to set aside the ex-parte decree dated 20 August 2014 passed in Summary Suit No. 334 of 2012, having regard to the conditional order of 6 March 2014 requiring deposit of the principal amount as a condition for leave to defend.
Law Points
- summary suit under Order XXXVII
- conditional leave to defend
- deposit of principal amount
- ex-parte decree
- setting aside ex-parte decree
- written contract for supply of goods
- joint and several liability
- personal guarantees
- recovery of price
- inherent jurisdiction to set aside decree
- commercial courts act section 13
Case Details
2017 LawText (BOM) (02) 40
Appeal (Lodg.) No. 310 of 2016, Appeal (Lodg.) No. 309 of 2016, Appeal (Lodg.) No. 311 of 2016
S.C. Dharmadhikari, B.P. Colabawalla
Pravin Samdani, Ranbir Singh, Venkatesh Dhond, Archit Jayakar, Nikhil Wable, Dimple Magitia
Hayagriv Ashok Jogani, Aditya Ashok Jogani, Vikram Ashok Jogani
Sailam BVBA, Helios Jewellery Pvt. Ltd., Ashok Keshavlal Jogani
Subscribe to unlock Case Details (Citation, Judge, Date & more)
Subscribe Now
Nature of Litigation
Appeal against refusal to set aside an ex-parte decree passed in a summary suit for recovery of the price of diamonds supplied under invoices.
Remedy Sought
The appellants (original Defendants 2-4 and Defendant 5) sought to set aside the ex-parte decree dated 20 August 2014 passed in Summary Suit No. 334 of 2012.
Filing Reason
The ex-parte decree was passed because the defendants failed to comply with the conditional order dated 6 March 2014 that required them to deposit the principal amount as a condition for filing a written statement.
Previous Decisions
On 6 March 2014, the learned single Judge granted conditional leave to defend upon deposit of the principal amount; defendants did not deposit; ex-parte decree passed on 20 August 2014; Notice of Motion No. 1562 of 2015 to set aside the decree was dismissed on 16 April 2016, leading to these appeals.
Issues
Whether the learned single Judge correctly dismissed the application to set aside the ex-parte decree dated 20 August 2014.
Judgment Excerpts
This Appeal ... under section 13 of the Commercial Courts Commercial Division and Commercial Appellate Division of High Courts Act, 2015 ... challenges the order passed by the learned single Judge dated 16th April, 2016, in Notice of Motion No.1562 of 2015 ... It is the rejection of the appellants' application for setting aside an ex-parte decree dated 20th August, 2014, passed in the above Summary Suit which is impugned in this appeal.
The defendant shall deposit the entire principal amount in this Court within 8 weeks from today. The defendant shall be entitled to file its written statement within 2 weeks of the deposit and within 10 weeks from today. The defendant shall have unconditional leave to defend the plaintiff's suit for interest.
Procedural History
Summary Suit No. 334 of 2012 filed by Sailam BVBA under Order XXXVII CPC against Helios Jewellery Pvt Ltd and four individual guarantors; Summons for Judgment No. 311 of 2012 taken out; by order dated 6 March 2014, single Judge granted conditional leave to defend upon deposit of principal amount within 8 weeks; defendants failed to deposit; ex-parte decree passed on 20 August 2014; Notice of Motion No. 1562 of 2015 filed by defendants for setting aside ex-parte decree; by order dated 16 April 2016, single Judge rejected the motion; appeals filed under Section 13 of Commercial Courts Act, 2015.
Acts & Sections
- Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015: Section 13
- Code of Civil Procedure, 1908: Order XXXVII
