SC: Dismissal of O.IX R.13 application does not take away right to appeal

The Hon’ble Supreme Court, on 21st November 2019, in the matter of N. Mohan v. R. Madhu, pronounced that a defendant cannot be deprived of a right to appeal merely on the ground that the application filed under Order IX Rule 13 CPC was earlier dismissed.

After dismissal of the application filed under Order IX Rule 13 CPC for condonation of delay in filing the appeal, whether the appeal filed under Section 96(2) CPC against the ex-parte decree is maintainable?

When an ex-parte decree is passed, the defendant has two remedies – (a) Either to file an application under Order IX Rule 13 CPC to set aside the ex-parte decree by satisfying the court that the summons was not served or if served, the defendant was prevented by “sufficient cause” from appearing in the court when the suit was called for hearing; (b) to file a regular appeal from the original decree to the first appellate court in terms of Section 96(2) CPC and challenge the ex-parte decree on merits. (Para 9)

Right to file an appeal under Section 96(2) CPC is a statutory remedy. The right to appeal is not a mere matter of procedure; but is a substantive right. Right to appeal under Section 96(2) CPC challenging the original decree passed ex-parte, being a statutory right, the defendant cannot be deprived of the statutory right merely on the ground that the application filed under Order IX Rule 13 CPC was earlier dismissed. (Para 10)

When the defendant filed appeal under Section 96(2) CPC against an ex-parte decree and if the said appeal has been dismissed, thereafter, the defendant cannot file an application under Order IX Rule 13 CPC. This is because after the appeal filed under Section 96(2) of the Code has been dismissed, the original decree passed in the suit merges with the decree of the appellate court.  (Para 16)

Whether the time spent in the proceedings to set aside the ex-parte decree be taken as “sufficient cause” within the meaning of Section 5 of the Limitation Act, 1908 so as to condone the delay in preferring the first appeal?

In case the court is satisfied that the defendant has adopted dilatory tactics or where there is lack of bona fide, the court may decline to condone the delay in filing the first appeal under Section 96(2) CPC. But where the defendant has been pursuing the remedy bona fide under Order IX Rule 13 CPC, if the court refuses to condone the delay in the time spent in pursuing the remedy under Order IX Rule 13 CPC, the defendant would be deprived of the statutory right of appeal. Whether the defendant has adopted dilatory tactics or where there is lack of bona fide in pursuing the remedy of appeal under Section 96(2) of the code after the dismissal of the application under Order IX Rule 13 CPC, is a question of fact and the same has to be considered depending upon the facts and circumstances of each case. (Para 15)

Copy of judgement: Judgement_21-Nov-2019

-Adv. Tushar Kaushik

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