DESH RAJ v. BALKISHAN (D) THROUGH PROPOSED LR MS. ROHINI

BALKISHAN (D) THROUGH PROPOSED LR MS. ROHINI (Civil Appeal No. 433 of 2020) JANUARY 20, 2020 [S. A. BOBDE, CJI, B.R. GAVAI AND SURYA KANT, JJ.] Code of Civil Procedure, 1908 – Or. VIII, r. 1 – Timeline for filing written statement in non-commercial disputes – Agreement to sell entered on 17.03.2017 between the appellant and the respondent, who are brothers, for sale of one floor of the ancestral property for Rs. 7.5 lakhs – Rs.1 lakh paid as earnest money to the appellant – Agreement not honoured – Respondent filed suit inter alia for specific performance – Appellant’s opportunity of filing written statement was closed and defence struck off owing to repeated delays and non-adherence of deadlines – High Court summarily dismissed the petition relying upon it’s order in one Oku Tech case which was rendered in the context of a commercial dispute qua Or.VIII, r.1 as amended by the Commercial Courts Act, 2015 – Held: Counsel for the respondent has not contested the non-commercial nature of the dispute – Dispute does not fall within the parameters specified u/s.2(c) of the 2015 Act and in particular sub-clause (vii), as the immovable property here is not of a nature which is “used exclusively in trade or commerce”– High Court overlooked the nature of the dispute and mistakenly applied the ratio of a case rendered in light of modified version of the CPC applicable only to commercial disputes – Further, numerous opportunities were accorded to the appellant – He was served on 01.05.2017 – It was only on 02.11.2017, after delay of 95 days post the maximum extendable period under the Proviso of Or. VIII, r.1 that the appellant claimed to have filed his written statement – Only defence taken to the repeated and blatant lapses is that the appellant’s counsel was not turning up – Appellant is seeking condonation in a casual manner – This ought not to be permitted or encouraged – Although the unamended Or.VIII, r.1 is directory, it cannot be interpreted to bestow free hand to any litigant/lawyer to file written statement at their own sweet-will– Legislative 14 DESH RAJ v. BALKISHAN (D) THROUGH PROPOSED LR MS. ROHINI objective behind prescription of timelines under the CPC must be given due weightage so that disputes are resolved in time-bound manner – Appellant failed to give or even attempt to proffer any cogent reason for the delay, though he is right that the High Court erroneously relied upon the ratio of Oku Tech – Lenient view taken in the unique circumstances of the case – Discretion exercised not a precedent – Written statement filed by the appellant on 02.11.2017 (as claimed), be taken on record with a copy to counsel for the respondent within one week from today, subject to payment of costs of Rs.25,000/- to the respondent – Orders of the courts below set aside – Commercial Courts Act, 2015 – ss.2(c) and 16. Commercial Courts Act, 2015 – ss.2(c) and 16 – Amendment of CPC in its application to commercial disputes – Held: Post coming into force of the said Act, there are two regimes of civil procedure wherein commercial disputes [as defined u/s.2(c) of the said Act] are governed by the CPC as amended by s.16 of the said Act; all other non-commercial disputes fall within the ambit of the unamended/original provisions of CPC – Code of Civil Procedure, 1908 – Or. VIII, r. 1. Disposing of the appeal, the Court HELD: 1.1 The Commercial Courts Act, 2015 through Section 16 has amended the CPC in its application to commercial disputes. Hence, it is clear that post coming into force of the aforesaid Act, there are two regimes of civil procedure. Whereas commercial disputes [as defined under Section 2(c) of the Commercial Courts Act, 2015] are governed by the CPC as amended by Section 16 of the said Act; all other non-commercial disputes fall within the ambit of the unamended (or original) provisions of CPC. Counsel for respondent has not contested the non-commercial nature of the dispute, and even independently the Court is satisfied that the dispute does not fall within the parameters specified under Section 2(c) of the Commercial Courts Act, 2015 and in particular sub-clause (vii), as the immovable property here is not of a nature which is “used exclusively in trade or commerce”. Hence, the appellant is correct in contending that the High Court overlooked the nature of the dispute and mistakenly applied the ratio of a case rendered in 15 A B C D E F G H 16 A B C D E F G H SUPREME COURT REPORTS [2020] 5 S.C.R. light of a modified version of the Code of Civil Procedure, which would only be applicable to commercial disputes. [Paras 11, 12 & 14] [20-D-E; 21-A-B; 21-E-H] Atcom Technologies Ltd. v. Y.A. Chunawala and Co. (2018) 6 SCC 639 – relied on.

1.2 Although the unamended Order VIII Rule 1 of CPC is directory, it cannot be interpreted to bestow a free hand on any litigant or lawyer to file written statement at their own sweet- will and/or to prolong the lis. The legislative objective behind prescription of timelines under the CPC must be given due weightage so that the disputes are resolved in a time-bound manner. Inherent discretion of Courts, like the ability to condone delays under Order VIII Rule 1 is a fairly defined concept and its contours have been shaped through judicial decisions over the ages. Illustratively, extreme hardship or delays occurring due to factors beyond control of parties despite proactive diligence, may be just and equitable instances for condonation of delay. Numerous opportunities had been accorded to the appellant. He was served on 01.05.2017 and entered appearance through counsel on 15.05.2017. As per Order VIII Rule I of CPC, the appellant ideally ought to have filed his written statement by 31.05.2017; and at the very latest by 30.07.2017. In addition to two separate deadlines for filing of the written statement within the 90-day timeframe prescribed by the ‘original’ Order VIII Rule 1, the Civil Court even post expiry of the 90-day period again gave one last and final opportunity on 18.09.2017 subject to payment of costs of Rs 3,000. None of these deadlines were complied with. Even on 11.10.2017, when the Court finally closed the appellant’s ability to file written statement and struck- off his defence from the record, no attempt was made to comply with the process of law. It was only on 02.11.2017, after a delay of 95 days post the maximum extendable period under the Proviso of Order VIII Rule 1, CPC that the appellant claimed to have filed his written statement. Curiously however, even by the next hearing on 03.11.2017, the appellant had failed to provide a copy of the written statement to the respondent as had been noted by the Civil Court. [Paras 16-18] [22-A-G] DESH RAJ v. BALKISHAN (D) THROUGH PROPOSED LR MS. ROHINI

1.3 The only defence taken to these repeated and blatant lapses is that the appellant’s counsel was not turning up. No attempt has been made to even proffer a reasoned justification or explanation, and it is clear that appellant is seeking condonation in a casual manner. This ought not to be permitted or encouraged. Nothing prevented the appellant from filing the written statement through counsel or in person. He has, thus, failed to give any cogent reason for the delay and is unable to satisfy due diligence on his part though he is right in his submission that the High Court erroneously relied upon the ratio of Oku Tech. Having held so, there could be no escape but to dismiss this appeal. However, taking a lenient view given the unique circumstances of the case, and without laying down the discretion being exercised hereinafter, as a precedent, it is directed that the written statement filed by the appellant on 02.11.2017 (as claimed), be taken on record with a copy to counsel for the respondent within one week from today and further subject to payment of costs of Rs. 25,000/- to the respondent. The orders of the courts below are thus set aside and the appeal is disposed of in the above terms. [Paras 19, 21, 23] [22-G-H; 23-A-E]