Balancing (In)Equities – Revisiting Restoration of Restoration Applications under the CPC
Introduction
Order IX of the Code of Civil Procedure, 1908 (“CPC”) deals with the consequences of non-appearance of parties in civil proceedings. Section141 of the CPC entitled ‘Miscellaneous proceedings’ stipulates that the procedure provided in the CPC shall be followed, as far as it can be made applicable, in all proceedings in any court of civil jurisdiction. Order IX Rule8 outlines the procedure to be adopted only when the defendant appears. Order IX Rule 9 stipulates that when a suit is dismissed under Rule 8 of Order IX due to non-appearance of the plaintiff, the plaintiff can apply for an order to set aside such dismissal, such order being contingent upon establishing sufficient cause for the non-appearance.
Historically, there have been instances where such applications under Order IX Rule 9 (for setting aside dismissal) itself were dismissed owing to the applicant-plaintiff’s Non-appearance. Consequential remedy available in such situations has been a subject of debate where it was observed that the High Courts have taken divergent views. The key difference arose especially on the aspect of maintainability of appeal against an order which dismissed an application for restoring another application that was originally filed for restoring the suit, and on the aspect of limitation.
For the sake of convenience, restoration applications are hereinafter referred with twonotations:
· Application A: An application filed for restoration of the entire civil suit.
· Application B: Application filed for restoration of Application A itself which was dismissed due to non-appearance of parties or any other reason.
In 2017, the differing views of the High Courts in this regard were considered by the Hon’ble Supreme Court in Jaswant Singh and Ors. vs. Prakash Kaur and Ors.[1]Although in Jaswant Singh, there was only one restoration application filed (for restoring an application under Order IX Rule 13) and the same was dismissed on merits, the Hon’ble Court still considered precedents relating to the dismissal of such applications and the consequent remedies thereafter. The implications of Jaswant Singh (supra) are far-reaching, especially from a standpoint of equity. Therefore, an analysis of these implications is necessary to better appreciate the current position of law, as well as to identify its shortcomings.
To Appeal or Not to Appeal – The Divergence in Jaswant Singh
On the aspect of applicable provision of the CPC, the Madhya Pradesh High Court in its oft-cited judgement in Nathu Prasad vs. Singhai Kapurchand [2], held that when Application A is dismissed, Application B is maintainable under the very same provision, i.e., Order IX Rule 9 of the CPC. The High Court supplanted its reasoning through Section 141 of the CPC, which provides that the procedure provided under the CPC for suits will apply to “all proceedings” before civil courts. Consequently, the High Court held that proceedings under Order IX Rule 9 of the CPC qualify as “proceedings” under Section 141 of the CPC.
The High Court further held that an order rejecting Application B is not appealable under Order XLIII of the CPC, whereas an order dismissing Application A is appealable. This interpretation of the High Court was based on the words “for an order to set aside the dismissal of a suit”, in Order XLIII Rule 1(c), which deals with the procedure applicable for appeals under the CPC. The High Court held that the dismissal of Application B is not equivalent to the dismissal of an entire civil suit and hence, the same is not appealable. On the other hand, an order dismissing Application A is appealable, as it was filed for restoration of the civil suit itself and against dismissal of any other application.
Considering the above view and a contrasting view of the Kerala High Court in K.P. Jayakumar vs. K. Ravindranand Ors.[3], the Hon’ble Supreme Court in Jaswant Singh (supra) adopted a view which was divergent from that of the Madhya Pradesh High Court.
The Hon’ble Court held that the judgment in Nathu Prasad (supra) cannot be approved, to the extent that it was held that an order rejecting Application Bis not appealable. It was reasoned that when Application B has also been held to be preferable in terms of Order IX Rule 9, it cannot be said that dismissal of the same is not appealable. It was reasoned that in such cases, Section 141of the CPC becomes applicable, and an appeal would therefore lie from an order dismissing Application B, as the said order would be an order passed in 'miscellaneous proceedings’.
The Limitation Angle – A Missed Opportunity in Jaswant Singh
Following the above analysis, the Supreme Court deliberated on the question of whether limitation for filing an appeal against an order dismissing Application B would be calculated as per Article 122 (30 days) or Article 137 (three years) of the Limitation Act, 1963; however the Hon’ble Court did not examine this question fully considering it to be not relevant in the factual matrix of Jaswant Singh’s case. With due respect, it is opined that the Hon’ble Court appears to have missed an opportunity to balance the equities involved. This is considering the implication that if Article 137 of the Limitation Act, 1963 is held to be applicable, then the party would have three years to file an appeal against an order dismissing Application B, much to the detriment of the opposite party, apart from further protracting the entire litigation.
The question of limitation in case of dismissal of Application B has been succinctly considered by the Calcutta High Court in Nurnahar Bewa and Ors. vs. Rabindra Nath Devand Ors.[4]The Hon’ble Court observed that whereas the limitation for an appeal from an order dismissing Application A is thirty days (by Article 122 of the Limitation Act, 1963),the limitation for availing a remedy against the dismissal of Application B will be 3 years (by Article 137 of the Limitation Act). The Hon’ble Court then held that such a position is inequitable and would cause serious prejudice to the party who has obtained an ex parte, as the fate of such a decree would be left hanging, while the other party can take 30 days and then 3 years to file restoration Applications A and B respectively, that too one after the other. Basis this analysis, the Hon’ble Court remarked that Article 122 would require suitable amendment to bringwithin its ambit an order dismissing Application B as well, to avoid aninequitable position.
However, the position of law which was classified “inequitable” by the Hon’ble Calcutta High Court still persists as the applicable law. Other High Courts have consistently held that applications under different Rules of Order IX, will not be governed thereunder– instead, Article 137 (being the residuary article) will apply.[5] The ratio of these judgements is based on a strict interpretation of Article 122, which has been held to apply only to revision or review applications that were dismissed in default.
Balancing the (In)Equities in the Current Position of Law
Considering the current position of law that an order dismissing Application B is appealable and/or concurrently restorable, it can be stated that the rights of parties in genuine cases (however rare they may be) will be safeguarded at all times and application of the principle of audi alteram partem (hear both sides) consistently would be to the benefit of such parties. The availability of these concurrent remedies will also provide parties with more options to take strategic call in pursuit of the case. These equitable aspects are identifiable in the current position of law.
However, as highlighted by the Calcutta High Court in Nurnahar Bewa (supra), the limitation period of three years will undoubtedly cause grave prejudice to the party who has obtained an ex parte decree, due to no fault of their own. Moreover, making concurrent remedies available against the dismissal of Application B further aggravates the prejudice suffered by the party. Further, while audi alteram partem may be adhered to, the current legal position leads to an impracticable scenario. It is trite that impracticability of law isa key exception audi alteram partem. Consequently, the current position of law, which results in impracticability, requires to be reconsidered.
In light of the inequities apparently and substantially outweighing the equities, this position of law (especially from the perspective of Section 141, Order IX and Order XLIII) merits a re-look, revisit and required revision, as suggested in Nurnahar Bewa (supra).
References
[1] Jaswant Singh and Ors. vs. Prakash Kaur and Ors., AIR 2017 SC 5275.
[2] Nathu Prasad vs. Singhai Kapurchand, AIR 1976 MP 136.
[3] K.P. Jayakumar vs. K. Ravindran and Ors., AIR 2004 Ker 209.
[4] Nurnahar Bewa and Ors. vs. Rabindra Nath Dev and Ors., AIR 1988 Cal358.
[5] See Om Chandra vs. Smt. Sheobrat Koer and Ors., 1990 (38)BLJR 863; Visalakshi vs. Umapathy, 2015 (5) CTC 67; Subburayulu Naidu vs. B.Krishnamurthy Naidu (Died), CRP No. 867 of 2017, decided by Hon’ble Madras High Court on 03.03.2021.