SHAMINDER SINGH BHATIA & ANR. vs MR. VISHNU BHAGWAN @ BALWAN SINGH

* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 14th December, 2023
Pronounced on: 25th January, 2024

+ CS(COMM) 125/2021
SHAMINDER SINGH BHATIA & ANR. ….. Plaintiffs
Through: Mr. Vierat K. Anand, Mr. Harish Nadda, Mr. Kumar Shashank, Mr. Vikalp Singh and Mr. Arun Yadav, Advocates.

versus

MR. VISHNU BHAGWAN @ BALWAN SINGH ….. Defendant
Through: Mr. Kartickay Mathur, Advocate.

CORAM:
HON’BLE MR. JUSTICE SANJEEV NARULA
JUDGMENT

SANJEEV NARULA, J.:

O.A. 33/2023(under Rule 5 Chapter 2 of the Delhi High Court Rules, 2018 on behalf of Defendant against order dated 24th January, 2023)

1. The present suit has been filed by the Plaintiff (Mr. Shaminder Singh Bhatia) (“Respondent” in the present application) seeking specific performance of an agreement entered into between parties. He seeks a decree against the Defendant (Mr. Vishnu Bhagwan) for payment an amount of INR 3 crores. Present appeal, stemming from the suit, has been filed by the Defendant (“Appellant”) against the order dated 24th January, 2023 (“Impugned Order”) passed by the Joint Registrar (“JR”). This Impugned Order has been passed rejecting I.A. 14154/2022, filed by Defendant-Appellant seeking condonation of delay in filing of the written statement.
2. The JR in their decision noted that the written statement was submitted 148 days after the summons were served through publication. This duration exceeds the statutory condonable limit of 120 days for filing a written statement. Consequently, the JR held that such a delay could not be condoned, as it exceeded the prescribed timeline. In response, the Appellant has filed the present appeal, contesting the JR’s interpretation of the commencement of the limitation period. The Appellant argues that the limitation period should start from the date on which they were actually served with the plaint, rather than the date of service through publication. They contend that the circumstances justifying substituted service, in this case, are insufficient or not adequately established. Therefore, according to the Appellant, the calculation of the limitation period as determined by the JR is incorrect, and as such, the delay in filing the written statement should be reassessed based on the date of receipt of the paper-book.

BRIEF FACTS
3. The process of serving summons in this suit encountered obstacles, as attempts through postal mode were unsuccessful. The summons were returned with the report that the Defendant (Appellant) was “not residing at the given address”. Additionally, the summons sent via courier were pending delivery, as noted in order dated 24th September, 2021. In light of these challenges, counsel for Respondent argued that the address provided in the memo of parties was the Appellant’s last known address. He requested for Court’s permission to file an application for substituted service, suggesting that the Appellant is deliberately avoiding the service of summons.
4. Accordingly, I.A. 13880/2021 filed by Respondent for substituted service under Order V Rule 20 of the Code of Civil Procedure, 1908 (“CPC”) was allowed vide order dated 27th October, 2021 and the Respondent was permitted by the JR to serve summons through publication in newspapers. Publications in designated newspapers was carried out on 24th November, 2021, returnable for an extremely short period of merely two days, i.e., 26th November, 2021. On 12th January, 2022, the JR deemed that the service on the Appellant had been duly completed.
5. The Appellant was first represented by counsel in the suit proceedings on 13th July, 2022. It was during this representation that the Appellant claimed to have first learned of the ongoing proceedings of the suit. This awareness stemmed from statements made by counsel in a separate but related case, FAO 404/2015, which was being heard by a coordinate bench of this Court. To provide context, FAO 404/2015 is an appeal concerning an order in a probate petition related to a Will, which includes the property at issue in the instant suit. In these interconnected proceedings, the Appellant had submitted an application for the release of a deposit of INR 2 crores, based on a settlement reached between the parties. Upon learning of the present suit, the Appellant promptly requested the Respondent to provide copies of the plaint and associated documents. These documents were subsequently received by the Appellant on 11th July 2022
6. Following the receipt of the plaint and documents, the Appellant took prompt action. On 20th August 2022, they filed a written statement accompanied by an affidavit of admission and denial of Respondent’s document. This was accompanied with an application seeking the condonation of the delay in filing the written statement.
7. In the aforementioned application for condonation of delay, Appellant contended that effective date of service of summons should be deemed to be 11th July, 2022, i.e., the date when the complete set of plaint and documents were supplied by Respondent. If the period of limitation is construed from the said date, the statutory period for filing the written statement would expire only on 16th August, 2022, since this Court was closed from 09th August, 2022 to 15th August, 2022. The Appellant further submits that even if the court holidays were not to be accounted for, the statutory period expired only on 11th August, 2022 and the written statement was filed on 20th August, 2022 and thus, there was only a short delay of 09 days in filing written statement. Appellant also contends in arguendo that even if due date of service is considered to be 24th November, 2021, i.e., the date of publication in the newspapers, Appellant would still be entitled to condonation of delay in view of the orders passed by the Supreme Court in In Re: Cognizance for Extension of Limitation and period of 30 days for filing written statement would expire on 30th March, 2022.
8. The Respondent, on the other hand, opposed the application for condonation of delay and contended that as there was a delay of 148 days in filing the written statement, in light of the provisions of the Commercial Courts Act, 2015 (“CCA”), such delay being beyond 120 days from the date of service, cannot be condoned and their right to file written statement stands forfeit. Respondent further argued that they had to adopt substituted mode of service as Appellant was not traceable at the given address. Since there was no challenge to the order dated 27th October, 2021 allowing the application for substituted service, there can be no challenge to the decision for allowing substituted service.

IMPUGNED ORDER

9. JR considered the aforenoted contentions but ultimately accepted the stand of Respondent and concluded that the date of service of summons for the purpose of limitation would be construed from the date of publication of summons in the newspapers. Relevant position of the Impugned Order reads as under:

“Therefore, it is to be ascertained whether the case of the defendant falls within the first version which is yet to be discussed and considered or within the second version wherein there is no scope for condoning the delay.
Now coming to the merits of the application, the address of the defendant given in the Memo of Parties by the plaintiffs was “ Village Aurangpur, District Jhajjar, Haryana”. Learned counsel for defendant had taken a stand that the defendant had shifted his address from Village Aurangpur, District Jhajjar, Haryana to Post Dadri Toe, Tehsil Badli District Jhajjar, Haryana and therefore, he never received the summons of the suit. There is no dispute to the fact that the defendant was residing on the address given in the Memo of Parties. While perusing both the addresses, it is noticed that the house numbers are not given in both the addresses. In the address given in the Memo of Parties, the name of the Village is mentioned as Aurangpur whereas in the new address given in the captioned IA, the name of the village has not been mentioned but the Post and the Tehsil has been mentioned. In the address given in the Memo of Parties, the name of Post and Tehsil has not been mentioned. No proof has been produced by the defendant to show whether the new address given by him is a different address or that he is residing therein. The application is completely silent with respect to the date when the earlier address was left by the defendant or the date when the defendant started residing at his new address, if so mentioned in the IA. The judicial notice is taken of the fact that Village Aurangpur is under Post Dadri Toe and Tehsil Badli in Distt. Jhajjar. In the absence of any documents substantiating his averments with respect to the change in the address, and concealing the dates of shifting to another address if any, this submission of the defendant’s counsel is liable to be turned down. The previous reports on the address given in the Memo of Parties have been perused. The summons have been received back unserved through speed post with the report “not residing at the given address and the new address not known”.
As far as the alternative address of the School allegedly run by defendant is concerned. The plaintiff in para No.5 of his plaint has averred that defendant represented to the plaintiff that he was managing an educational institution namely GDK Palit Middle School, Aurangpur, Jhajjar, Haryana, on behalf of Major General Palit. It is pertinent to mention here that this school is also stated to be in village Aurangapur which he alleged to have left. He has not filed any document to show his post in the said school or that it was his place of work or that he was working for gain there. Just a passing reference to any address would not make it a address relevant for the purposes of correspondence. In the very said para, it is also mentioned in the plaint that he was working with Major General Palit in the capacity of care taker/manager of his assets. Therefore, this address can be taken to be an address for correspondence with Major General Palit and not with defendant.
Even in the agreements and Memo of Understanding placed on record and duly signed by defendant, his address is the one given in the Memo of Parties and not the School’s address.
Learned counsel for defendant during the course of the arguments has stated that he came to know about the pendency of this case in a proceeding under FAO No. 404/2015 on 02.06.2022. No document has been placed on record to show that in FAO proceedings this new address was given by the defendant. Therefore, this alternate address cannot be taken to be that of defendant on which plaintiff ought to have served the defendant.
The perusal of the service reports on the earlier address would show that defendant was not served on the given address.
Since the service was not effected at the address given in the Memo of Parties, defendant was served by way of publication. It is to be seen now as to how defendant got the information of pendency of the present suit. The defendant in his application has mentioned that he came to know about this suit during the proceedings in the case bearing FAO No. 404/2015 before Hon’ble Court between him and one other party and he was informed about the pendency of the present suit. The application has been perused carefully. It has nowhere been disclosed as to who gave the information about the pendency of the present suit. Admittedly, the plaintiff is not a party to those proceedings. Therefore, these submissions are not trustworthy. Counsel for defendant while addressing the arguments had also stated that though he came to know about the pendency of the present suit on 02.06.2022 in the said FAO, but details of the case were not provided. It is further stated that he tried to ascertain the details of counsel for plaintiff. There is not even an iota of word as to how the details of counsel for plaintiff were procured by the defendant. No name has been disclosed as to who gave the clue or who provided the information about the present suit which enabled the defendant to get the copy of the paper book from the plaintiff’s counsel to file the written statement thereafter.
The version of the defendants with respect to the knowledge of the suit from FAO No 404/2015 on 02.06.2022 is completely an afterthought in order to take the advantage of the period of limitation so as to file the written statement.
The defendant was duly served by way of publication which was duly accepted as valid service by Learned Predecessor.
In the rejoinder to the reply of the plaintiff, defendant has tried to invoke order IX Rule 7 CPC. Rejoinder has come on record after case was reserved for orders. Nonetheless, this provision does not come to the rescue of defendant at all. Undoubtedly, defendant can join the proceedings from any stage, but that does not give him a right to undo what has been left earlier. He can’t read the provision to his advantage in such a manner that he can place his written statement on record, which is clearly beyond the period of limitation. Therefore, reliance on this provision is misplaced.
Written statement has been filed after expiry of 120 days from the date of service through publication. Therefore, written statement filed by defendant is beyond the period of limitation. Hence, application filed by defendant stands dismissed. Written statement is taken off the record.”

10. Appellant’s counsel assails the Impugned Order by contending that JR has failed to take note of the fact that the Respondents never made any diligent efforts to serve the Appellant, and as a consequence, the Appellant was never duly served. Service reports on record reveal that summons were returned unserved as Appellant was not residing at the given address. Substituted service was, thus, allowed in a mechanical manner. JR has erred by disregarding Appellant’s contentions regarding change of address. The service report clearly mentions that the Appellant does not reside at the address anymore. The JR also erred in rejecting the Appellant’s contention regarding the manner in which they became aware of suit proceedings, as they had supported their submission through an affidavit. Appellant would suffer irreparable loss due to dismissal of application and therefore, this Court should take a liberal approach to serve ends of justice.
11. The Respondents, on the other hand, defended the Impugned Order by contending that Appellant had deliberately avoided service and therefore, they had no other option but to effect service through substituted means. Even otherwise, the new address disclosed by Appellant is in the same area/ village/ district as the previous address. Thus, newspapers through which publication of summons was carried out should be deemed to be service on Appellant. The new address of the Appellant and the address of the Appellant as mentioned in the memo of parties are as follows:

New:
Vishnu Bhagwan
S/o Shri Nand Ram
R/o Post Dadri Toe,
Tehsil Badli District Jhajjar,
Haryana

Original:
Mr. Vishnu Bhagwan @ Balwan Singh,
S/o Sh. Nand Ram
R/o Village Aurangpur, District Jhajjar,
Haryana
Email not available

12. The Respondent also contends that the Appellant’s claim of a change of address has been appropriately discredited by the JR. Relying upon Order VIII Rule 10 of CPC and the judgment of Supreme Court in M/s SCG Contracts India Pvt. Ltd. v. K.S. Chamankar Infrastructure Pvt. Ltd. & Ors.,1 they argue that since the Appellant’s application for condonation of delay was filed after a lapse of more than 120 days, the Appellant has forfeited his right to file written statement.

ANALYSIS AND FINDINGS

13. The Court has considered the aforenoted contentions. CCA has introduced amendments to Order V Rule 1(1), which have established stringent timelines for the filing of written statements. These amendments mandate that a defendant must file their written statement within 30 days from the date of service of summons. The Court, however, may grant an additional grace period of 90 days if sufficient reasons are provided and recorded in writing. Consequently, any delay beyond a cumulative period of 120 days (comprising the initial 30 days plus an additional 90 days) from the date of service of summons is impermissible. In instances where this 120-day period is exceeded, the defendant’s right to file a written statement is automatically forfeited. This legal position, which precludes condonation of delays beyond 120 days, is well-established and undisputed in law.
14. The critical question before the Court is whether, in the context of this case, service by substituted means through publication should be regarded as the effective date for the commencement of the limitation period. To address this question, we must note that as per service reports on record pertaining to regular modes of service, Appellant was not served on the address provided by the Respondent. There was no report or any indication to the effect that Appellant had deliberately refused the service of summons. On the contrary, service report explicitly states that Appellant does not reside at the given address. Despite this report, the Respondent sought substituted service, alleging that the Appellant was deliberately avoiding service. We must also note that Respondent made only one attempt to serve Appellant through regular modes of service. They did not exercise any due diligence to trace the new address of Appellant or verify whether Appellant had shifted from the given address. Instead, they contended that Appellant was deliberately avoiding service and adopted substituted mode of service through publication. Indeed, there is no material before the Court to conclude that Appellant was ever residing at the address given in the memo of parties.
15. Article 123 of the Limitation Act, 1963, while not directly applicable to the case, provides guidance to the Court in adjudicating the present proceedings. Article 123 provides the time period for applying to the Court for setting aside an ex-parte decree, commences from either the date of the decree or the date on which the applicant becomes aware of the decree, if the applicant was not duly served. The explanation provides that substituted service under Order V Rule 20 of CPC shall not be deemed to be ‘due service’. The concept of ‘due service’ in Article 123 aligns with the interpretation given in Order V Rules 19 and 20 of the CPC, particularly focusing on Rule 20 which pertains to substituted service. Under Order V Rule 20(1) of the CPC, substituted service is permissible only when the Court is satisfied that a defendant is intentionally avoiding service or that service cannot be completed in the usual manner for other reasons. Therefore, for a defendant to be considered ‘duly served’ by substituted service, strict adherence to Order V Rule 20(1) is required. This implies that a defendant has the right to contest the validity of the substituted service, demonstrating either that they were not intentionally avoiding service, could have been served in the usual manner, or that the method of substituted service chosen by the court was not suitable under the circumstances.
16. The primary purpose of serving summons, whether personally or by substituted means as per Order V Rule 20(1), is to inform the defendant of the plaintiff’s claim. If the substituted service fails to effectively inform the defendant about the suit, it cannot be considered ‘due service’ within the meaning of this rule. The clause “or in such other manner as the Court thinks fit” in Order V Rule 20(1) offers the Court considerable discretion in determining the method of substituted service. However, any method employed must effectively communicate the claim to the defendant. The fact that the Court ordered substituted service does not automatically mean the service was ‘duly’ conducted as per sub-rule (2) of Rule 20 of Order V. A conjoint reading of Rules 20(1) and 20(2) asserts that the service substituted by the Court’s order shall be as effective as personal service only insofar as it allows the Court to proceed with the suit, but it does not preclude a defendant from challenging the compliance of the substituted service with Order V Rule 20(1).
17. Order V Rule 20 stipulates that substituted service must be used as the final resort, only when the Court is satisfied that service in the ordinary sense cannot be completed and that there is reason to believe that the defendant is avoiding service. Mere assertion of the Plaintiff that the Defendant is avoiding service is not sufficient for effecting substituted service under Order V Rule 20, the onus is on the Plaintiff to prove that the Defendant was avoiding service.2 Plaintiff cannot simply make a single attempt and resort to asking for leave to serve by substituted methods. Substituted service without any valid reason will go to the root of the matter and invalidate the service. In the present case, no cogent reasons were alluded to while applying for substituted service, right after a single attempt to conduct service. Therefore, such service cannot be held to be proper in light of established precedents.
18. Appellant contends that they first became aware of the present suit on 02nd June 2022, during the proceedings of FAO 404/2015. However, the JR did not accept this assertion, and noted the following in their observation:
“It is further stated that he tried to ascertain the details of counsel for plaintiff. There is not even an iota of word as to how the details of counsel for plaintiff were procured by the defendant. No name has been disclosed as to who gave the clue or who provided the information about the present suit which enabled the defendant to get the copy of the paper book from the plaintiff’s counsel to file the written statement thereafter.”

19. Upon review, this Court finds the JR’s scepticism about the Appellant’s acquisition of the details of counsel for Respondent to be misplaced. The documentation submitted by the Appellant includes a reply filed by one Mr. Jayadittya Palit in FAO 404/2015, indicating that the Appellant was informed about the suit by another party. Once apprised of the ongoing proceedings, it would have been feasible for the Appellant to retrieve necessary information from the public domain, specifically the Delhi High Court’s website. In light of this, the Court finds no basis to doubt the Appellant’s claim of obtaining knowledge about the suit on the specified date. The JR’s apprehension regarding the Appellant’s awareness of the suit and the subsequent actions taken by the Appellant are therefore deemed unfounded by this Court.
20. The JR erred by overly focusing on the credibility of the Appellant’s submissions, particularly criticizing the Appellant for not adequately explaining how they became aware of the present suit. The JR did not sufficiently consider two essential factors: first, there was no concrete evidence to suggest that the Appellant intentionally evaded service; and second, it was not conclusively established that the Appellant was indeed residing at the address to which the service was sent. Given that service through publication is inherently subject to scrutiny and challenge, the Appellant’s stated date of gaining knowledge of the suit, supported by the facts detailed in their application, should not have been summarily dismissed. The lack of consideration for these vital aspects in the JR’s findings indicates a significant oversight, which merits reconsideration in light of the presented evidence and circumstances.
21. Thus, based on the reasons discussed, the Court opines that the substituted service, effected under the presumption that the Appellant was avoiding service, should not be deemed as the starting point for calculating the limitation period. Furthermore, if the limitation period is calculated from 11th July, 2022, it becomes apparent that there was a delay of 09 days on part of the Appellant in submitting their written statement. However, considering the justifications provided in their application, this delay is deemed reasonable and should be condoned. The reasons outlined by the Appellant sufficiently explain the circumstances leading to the delay and justify granting leniency in this instance.
22. The appeal is allowed with following directions:
22.1 Impugned Order dated 23rd January, 2023 is set aside.
22.2 Delay in filing written statement is condoned and the same is taken on record.
22.3 Appellant is subjected to cost of INR 20,000 which is directed to be paid to Respondent to compensate for the delay caused.
23. Disposed of.

CS(COMM) 125/2021

24. List before the Roster Bench on 20th February, 2024.

SANJEEV NARULA, J
JANUARY 25, 2024
d.negi
1 (2019) 12 SCC 210
2 Sunil Gupta v. Asset Reconstruction Company, 2022 SCC Online Bom 2159- relying on Ganpatraj K Sanghvi v. Vishal Udyog, 2016 SCC Online Bom 5336
—————

————————————————————

—————

————————————————————

CS(COMM) 125/2021 Page 10 of 11