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Basiruddin Mandal v. Sonaulla Mandal
Structured Summary of the Opinion
Factual and Procedural Background
The petition before the court seeks to discharge an order of the Small Cause Court Judge at Jhenidah which set aside an ex parte decree originally obtained on 7 August 1908. The underlying facts in the record are that the Petitioner (the original plaintiff) obtained that ex parte decree in a money suit against the Defendant. Execution proceedings were said to have produced a recovery of Rs. 4 by attachment and sale on 14 December 1908. On 15 March 1909 the Defendant applied to set aside the ex parte decree, alleging (inter alia) that he never took the loan, had no knowledge of the suit, that processes were suppressed, that the ex parte decree was fraudulently obtained, and that the recorded execution entry of realization was fraudulent. The application was first presented to the first Munsif and then returned and ultimately refiled on 27 March 1909 in the Court of the second Munsif (the court which had made the ex parte decree). The petition was mis-registered initially as an ordinary application to set aside an ex parte decree in a money suit and, on discovery of that mistake on 7 August 1909, the petition was amended to be an application under the Small Cause Court jurisdiction. The Defendant was ordered on 7 August to deposit security under section 17 of the Small Cause Courts Act, was allowed extensions, and on 28 August deposited Rs. 78/12 (the decretal amount). The application was then heard on the merits and the Small Cause Court Judge set aside the ex parte decree. The Petitioner challenges that order on two main grounds described below.
Legal Issues Presented
- Whether the Defendant's application to set aside the ex parte decree was barred by limitation.
- Whether the deposit required by section 17 of the Small Cause Courts Act was made after the expiry of the prescribed time and whether the Court had power to extend that time (i.e., whether the mandatory deposit rule of sec. 17 precluded the application being entertained where deposit was made after the prescribed period).
Arguments of the Parties
Petitioner's Arguments (seeking discharge of the Small Cause Court's order)
- The learned Vakil for the Petitioner relied on Article 164 of the Second Schedule to the Limitation Act, 1877, contending the application to set aside the decree was time-barred — specifically, that execution process was enforced on 14 December 1908 and time runs from that date.
- He argued that when a party alleges that an entry in a judicial record is fraudulent, the Court should not entertain the allegation until a preliminary inquiry satisfies the Court that the charge of fraud is true; reliance was placed on Bhaobunesary v. Judobendra Narain Mullick to support that proposition.
- He further argued that section 17 of the Provincial Small Cause Courts Act is mandatory (as held in Jogi Ahir v. Bishen Dayal Singh and followed by some High Courts) and that because deposit was made after the expiry of the prescribed time the Court had no power to extend time or entertain the application.
Defendant's Arguments (applicant to set aside the ex parte decree)
- The Defendant alleged in his application that he never took the loan, had no knowledge of the suit, that processes had been suppressed, that the ex parte decree was fraudulently obtained, and that a subsequent entry recording realization by execution was itself fraudulent.
- He stated he became aware of the circumstances on 26 February 1909 and applied on 15 March 1909; at trial he gave sworn testimony asserting the fraud and the absence of service, which the court accepted as proved by his sworn evidence.
- The Defendant relied (in substance) on the proposition that where fraud is shown, limitation should not be allowed to bar relief unless the injured party had clear and definite knowledge of the fraud at a time too remote; he further relied on the procedural history (initial filing in the wrong Court and the subsequent correction) to justify reliance on sec. 14 of the Limitation Act to exclude time when computing limitation.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Bhaobunesary v. Judobendra Narain Mullick | Rule: in absence of evidence that processes were not served, sec. 114 of the Indian Evidence Act raises a presumption in favour of the legality of the proceedings. | The Court distinguished this case because, unlike Bhaobunesary, the applicant (Defendant) in the present matter produced his own sworn testimony proving the fraud and absence of service. |
| Rahimbhoy v. Turner | Rule: to invoke limitation against a complainant when fraud has been committed, the defendant must show the injured party had clear and definite knowledge of the fraud at a time making a suit too late; mere suggestion of fraud is insufficient (interpreting sec. 18 of the Limitation Act, 1877). | The Court cited this principle to note that when fraud is proved and the complainant lacked such knowledge within the limiting period, limitation does not operate; the Court found the Defendant's testimony established gross fraud. |
| Jogi Ahir v. Bishen Dayal Singh | Rule: provisions of sec. 17 of the Provincial Small Cause Courts Act are mandatory; an application to set aside an ex parte decree must be accompanied by the necessary security or deposit. | The Court acknowledged the rule but held the present case did not fall within the strict scope of that decision because of the earlier filing in the wrong forum and subsequent cure under the principles recognized in Jeun Muchi. |
| Jagan Nath v. Che Ram | Rule: (Allahabad High Court) adopts the view that sec. 17 is mandatory (aligning with Jogi Ahir). | The Court noted this adoption but found it not directly determinative of the present case given the facts and the application of Jeun Muchi and sec. 14 of the Limitation Act. |
| Somabhai v. Wadi Lal | Rule: (Bombay High Court) adopts the mandatory view regarding sec. 17. | The Court recorded this decision but declined to treat the present case as falling within its strict effect, for reasons explained by reference to Jeun Muchi and the procedural history. |
| Ramasami v. Kurisu | Rule: (Madras) reached a contrary view to the mandatory rule on sec. 17. | The Court noted the existence of this contrary view but did not base its decision on it. |
| Jeun Muchi v. Bodhiram Muchi | Rule: where an application under sec. 17 is filed without security but security is subsequently furnished within the time prescribed by limitation for such an application (or for deposit of decretal amount), the applicant has a right to have the application heard on the merits. | The Court treated this precedent as directly applicable and decisive: because the application had been initially filed (albeit in the wrong forum) and security was subsequently furnished within the permissible period when calculated under sec. 14 of the Limitation Act, the applicant was entitled to have the matter heard on the merits. |
Court's Reasoning and Analysis
The Court examined both grounds relied on by the Petitioner and rejected each on the basis of legal principle and the record.
On limitation: The Court observed it was unnecessary to decide whether the Limitation Act of 1877 or the Act of 1908 applied because, under either regime, the application to set aside the ex parte decree was within time. Under Article 164 of the 1877 Act (which requires an application by a defendant to set aside an ex parte judgment to be made within 30 days from the date of executing any process for enforcing the judgment), the Court accepted that the Defendant had alleged and proved by his sworn testimony that the alleged execution proceedings of 14 December 1908 were fraudulent and that no attachment or sale actually took place. Because the Defendant produced evidence (sworn testimony) of fraud, the Court distinguished Bhaobunesary v. Judobendra Narain Mullick (where no evidence was given and a presumption under sec. 114 of the Evidence Act was held to apply).
The Court also cited Rahimbhoy v. Turner for the principle that limitation runs only where the injured party had clear and definite knowledge of the fraud at a time which would make suit too late; mere suggestion is not enough. Applying that principle and accepting the Defendant's testimony as credible, the Court concluded the application was timely under Article 164 of the 1877 Act.
The Court stated it was inclined to the view that Article 164 of the 1908 Act was really applicable. That provision requires an application by a defendant to set aside an ex parte decree to be made within 30 days from the date of the decree, or where summons was not duly served, from the time the applicant has knowledge of the decree. The Court found that, even if the Defendant first became aware on 26 February 1909, his 15 March application would be in time. The Court further concluded that, based on the record, the Defendant only became definitely aware that the decree was one of the Small Cause Court on 7 August 1909; if time were counted from that date, there was plainly no limitation objection to his application.
On sec. 17 deposit requirement: The Court acknowledged authority (including Jogi Ahir and High Court decisions) holding that sec. 17 is mandatory and that an application to set aside an ex parte decree must be accompanied by necessary security. However, the Court relied on Jeun Muchi v. Bodhiram Muchi to adopt the principle that an application filed without security but where security is subsequently furnished within the time allowed by limitation entitles the applicant to have the application heard on its merits. The Court further held that the peculiar procedural history of this case (initial filing in the first Munsif's Court on 15 March 1909, subsequent transfer/refiling and an administrative mistake in registration, with correction only on 7 August 1909) brought the case within the scope of sec. 14 of the Limitation Act. Section 14 permits exclusion of time during which the applicant was prosecuting with due diligence another civil proceeding in a court unable to entertain it due to defect of jurisdiction or similar cause. Treating the application as effectively presented on 7 August 1909 (the date the mistake was corrected), the deposit made on 28 August 1909 was within the permissible period and the sec. 17 objection failed.
On both grounds therefore (limitation and sec. 17), the Court concluded the Small Cause Court Judge acted properly in setting aside the ex parte decree: the application was in time and the deposit/safety requirement was effectively satisfied in the circumstances.
Holding and Implications
Holding: The Court affirmed the order of the Court below (the Small Cause Court Judge) that set aside the ex parte decree and dismissed the rule seeking to discharge that order. Rule discharged.
Implications:
- The direct effect is that the Small Cause Court's order setting aside the ex parte decree stands: the Defendant's application to set aside the decree was properly entertained and granted by the lower Court, and that decision is affirmed.
- The Court's reasoning relied on accepted principles concerning fraud and limitation, the permissive application of sec. 14 of the Limitation Act to exclude time spent prosecuting proceedings in an improper forum, and the authority in Jeun Muchi that a late deposit (when security is ultimately furnished within the relevant limitation period) does not necessarily deprive an applicant of a hearing on the merits.
- The opinion does not announce a novel legal rule beyond the application of existing authorities to the facts; the decision applies precedent to the particular procedural circumstances and does not purport to set out any broad new precedent beyond those applications.
Rule discharged.
We are invited in this rule to discharge an order made by the Small Cause Court Judge of Jhenidab, the effect of which is to set aside an ex parte decree made on the 7th August 1908. The facts material for our decision are all matters of record and are really not open to doubt or dispute. The Petitioner brought a suit in the Small Cause Court at Jhenidab against the Defendant for recovery of a sum of money, and on the 7th August 1908 obtained an ex parte decree. His case is that execution was subsequently taken out and on the 14th December a sum of Rs. 4 was realised by the attachment and sale of some moveables of the judgment debtor. On the 15th March 1909, the Defendant made an application to set aside the ex parte decree which is the foundation of the proceedings now before us. In this application he alleged that he had never taken a loan from the Plaintiff, that he had no knowledge of the suit, that the processes had been suppressed, that an ex parte decree had been fraudulently obtained and that subsequently without the issue of any process in execution, a fraudulent entry had been made in the execution records to the effect that a sum had been realised by attachment and sale of his move able properties. He further alleged that he became aware of these circumstances on the 26th February 1909 and prayed that the ex parte decree might be set as He. This application was originally presented in the Court of the first Munsif at Jhenidah but was returned in the first instance for a fuller statement of details. The information required was furnished. But subsequently the application was returned for presentation to the proper Court. On the 27th March 1909, the application was refiled in the Court of the second Munsif who had made the ex parte decree which was sought to be set aside. The application, however, was treated as one to set aside an ex parte decree in an ordinary money suit and was apparently registered as such by the Court officers. The mistake was not discovered, so far as we can gather from the materials on the record, till the 7th August 1909, and on that date the officer of the Court, upon discovery of the mistake, amended the petition so as to convert it into an application to set aside an ex parte decree made by the Court in the exercise of its Small Cause Court jurisdiction. On the 7th August, upon objection verbally taken by the Plaintiff, the Defendant was asked to deposit the necessary security under sec. 17 of the Small Cause Courts Act; and was in the first instance allowed time till the 14th August. On that date he obtained further time; on the 28th August he carried out the order of the Court and deposited Rs. 7812 as, which represents the entire amount of the judgment-debt. His application was then heard on the merits and the Small Cause Court Judge set aside the ex parte decree. We are now invited to discharge that order substantially on two grounds; namely, first, that the application was on the face of it barred by limitation and ought not to have been entertained; and, secondly, that the judgment-debt was deposited after the expiry of the time prescribed by sec. 17 of the Small Cause Courts Act, and that the Court had no power to extend the time for such deposit.
In support of the first ground upon which the order of the Small Cause Court Judge has been challenged, the learned Vakil for the Petitioner has relied upon Article 164 of the Second Schedule of the Limitation Act of 1877. He has assumed that the provisions of the Act of 1877 are applicable, inasmuch as the ex parte decree was made at a time when that Act was in force, although the application to set aside the decree was made after the Act of 1908 had come into operation. It is not necessary for us to consider whether the provisions of the Act of 1877 or these of 1908 are applicable, because we are of opinion that whichever provision is applied, the application to set aside the ex parte decree is not open to objection on the ground of limitation. If we examine Article 164 of the Act of 1877, it becomes clear that the application has been made amply within time. Article 164 provides that an application by the Defendant for an order to set aside a judgment ex parte must be made within thirty days from the date of executing any process for enforcing the judgment. The learned Vakil for the Petitioner has contended that on the 14th December 1908, a process in execution was enforced, and that consequently time runs from that date. But it must not be overlooked that the Defendant in his application to set aside the ex parte decree alleged that the proceedings of the 14th December 1908 were fraudulent, and that there was in fact at that time no attachment or sale of any of his moveable properties. The learned Vakil for the Petitioner has however argued that when a party comes into Court and alleges that an entry made in a judicial record is fraudulent, his application ought not to be entertained till the Court has held a preliminary inquiry and has satisfied itself that the charge is true; in support of this position, reliance has been placed upon the case of Bhaobunesary v. Judobendra Narain Mullick. It is not necessary for our present purpose to consider whether the rule laid down in that case may not be open to criticism, because the present case is clearly distinguishable. In that case, there was no evidence adduced on the part of the applicant to show that the processes of the Court had not been served as shown by the record, and under these circumstances the learned Judges held that the provisions of sec. 114 of the Indian Evidence Act raised a presumption in favour of the legality of the proceedings. In the case before us, on the other hand, the Petitioner alleged and proved by his own sworn testimony that the proceedings in the suit as wall as in the execution were fraudulent. We may further point out that in the case of Rahimbhoy v. Turner, it was ruled by the Judicial Committee that in order to make limitation operate when a fraud has been committed by one who has obtained properly thereby, it is for him to show that the injured complainant has had clear and definite knowledge of the facts constituting the fraud at a time which is too remote for the suit to be brought, and mere suggestion of his having been defrauded, does not amount to such knowledge as is required by sec. 18 of the Indian Limitation Act, 1877. In the case before us, if the testimony of the Defendant is believed, and there is no reason why that testimony should be distrusted, the case is one of gross fraud, and this may be one reason why the Petitioner has not ventured to take his oath as to the service of the processes in execution on the 14th December 1908. We must, therefore, hold that if Article 164 of the Act of 1877 applies, the application is not open to the objection of limitation. We may add, however, that we are inclined to the view that the article which is really applicable is Act, 164 of the Act of 1908, which was in full force and operation when the application to set aside the ex parte decree was made. That article provides that an application by a Defendant for an order to set aside a decree passed ex parte must be made within thirty days from the date of the decree, or where the summons was not duly served, from the time when the applicant has knowledge of the decree. If it is assumed that the applicant had knowledge of the decree on the 26th February 1909, any application presented on the 15th March following would obviously be in time. But it has been suggested that the applicant became aware of the decree before the 26th February 1909. Against this, we have the sworn testimony of the Petitioner that his application was presented about fifteen days after the date when he first became aware of the decree. If, therefore, the provisions of the Act of 1908 apply, the application is not open to objection on the ground of limitation. We do not, however, hold that the applicant became aware of the decree before the 26th February 1909. It is obvious from the circumstances already narrated that he first became aware of the decree as a decree made by a Court of Small Causes so late as the 7th August 1909. Time, therefore, ought to run in our opinion from the latter date. In this view, there is no foundation for the objection of limitation. The first ground, therefore, upon which the order of the Small Cause Court is assailed must be overruled.
The second objection appears to us to be equally groundless. It is perfectly true that in the case of Jogi Ahir v. Bishen Dayal Singh(3), it was ruled by this Court that the provisions of sec. 17 of the Provincial Small Cause Courts Act are mandatory and that an application to set aside an ex parte decree must “be accompanied by the necessary security or deposit. The same view has been adopted by the Allahabad High Court in the case of Jagan Nath v. Che Ram(4) and by the Bombay High Court in the case of Somabhai v. Wadi Lal(5) although a contrary view had been adopted in Madras in the case of Ramasami v. Kurisu(6). The present case, however, does not fall within the scope of any of these decisions, but is, in our opinion, completely covered by the decisions of this Court in the case of Jeun Muchi v. Bodhiram Muchi(7), where it was ruled that if an application under sec. 17 of the Provincial Small Cause Courts Act is filed without security which is subsequently furnished within the time prescribed by the law of limitation for an application and deposit of the decretal amount or security, the applicant has a right to have his application heard on the merits. Now in the case before us, the application was originally presented in the Court of the first Munsif on the 15th March 1909, where it remained pending for some days. It was then refiled in the Court of the second Munsif, but it was by oversight registered as an application to set aside an ex parte decree in an ordinary money suit, and it was not till the 7th August that the mistake was discovered. In these circumstances, for the purpose of limitation, the Petitioner is entitled to the benefit of the provisions of sec. 14 of the Limitation Act which provides that in computing the period of limitation prescribed for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding whether in a Court of first instance or in a Court of Appeal, against the same party for the same relief, shall be excluded where such proceeding is prosecuted in good faith in a Court which from defect of jurisdiction or other cause of a like nature is unable to entertain it. The learned Munsif would have been in order if he had directed on the 7th August 1909 that the Petitioner should file a new application in his Court on the Small Cause Court side. If that had been done on the 7th August, no question of limitation could arise in view of the provisions of sec. 14, as the Petitioner would have been entitled to a deduction of time from the 15th March to the 7th August. If the application, therefore is treated as presented on the 7th August 1909, no question arises as to the deposit having been made beyond the period prescribed by sec. 17 of the Small Cause Courts Act, because as we have already held, it was on that date that the Petitioner first became definitely aware of the fact that an ex parte decree had been made against him by the Small Cause Court Judge. The second ground therefore completely fails.
The result is that the order of the Court below must be affirmed and this rule discharged.
Rule discharged.
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