Section 17 Provincial Small Cause Courts Act 1887 | Requirement of Depositing Amount Due Under Decree is Not to Penalize the Defendant- Supreme Court

Recently, The Supreme Court stated that the requirement of depositing the amount due under decree is not to penalize the defendant.

The bench of Justices Dinesh Maheshwari and Bela M. Trivedi was dealing with the appeal challenging the judgment passed by the High Court where the High Court has declined to interfere with the order passed by the Court of Additional District and Sessions Judge rejecting an application under Order IX Rule 13 of Code of Civil Procedure 1908 for setting aside ex parte judgment and decree.

In this case, The respondent asserting his capacity as owner and proprietary right holder filed the suit against the late father of the appellants in the Small Causes Court, stating that the defendant was a tenant in the suit shop at a monthly rent of Rs. 2000/- per month and has failed to make a payment of rent from the month of February 2015 to the month of May 2015, amounting to Rs. 8000/- and 15% municipal tax despite notice.

The Trial Court held that service of summons on the defendant was sufficient and proceeded ex parte for want of appearance on behalf of the defendant and after taking evidence decreed the suit with costs, for recovery of arrears of rent in the sum of Rs. 8000/- and for eviction of the defendant from the suit shop while also holding the plaintiff entitled to receive damages from the defendant, for use and occupation of the suit shop, at the rate of Rs. 2000/- per month until delivery of actual vacant possession.

The defendant, the predecessor of the appellants, moved an application under Order IX Rule 13 CPC along with an application under Section 5 of the Limitation Act, 1963.

He also moved an application under Section 17 of the Provincial Small Clause Courts Act, 1887, along with a tender seeking permission to deposit the decretal amount of the tune of Rs. 11212/- inclusive of the amount of costs.

An objection was taken by the plaintiff-respondent against the application so moved by the defendant with the submissions that under the decree in question, he was entitled not only to the said arrears of rent and costs but also to damages at the rate of 2000/- per month until possession continued with the defendant and necessary deposit towards damages having not been made, the application for setting aside ex parte decree was not maintainable.

The Trial Court upheld the objections of the plaintiff-respondent. The appellants approached High Court by filing a petition with the submissions that the defendant has not been served in the said civil suit, and the plaintiff-respondent obtained the decree with concealment of facts.

The High Court agreed with the Trial Court about non-compliance of the requirements of Section 17 of the Act of 1887.

The issue for consideration before the bench was:

Whether the order passed by the High Court needs interference or not?

The bench noticed that “…………… relation to the suit to which the Act of 1887 applies, an applicant seeking an order to set aside the decree passed ex parte is required to deposit the amount due under the decree/judgment or has to furnish security for due performance of the decree or compliance with the judgment. Even under Order IX Rule 13 CPC, while making an order for setting aside the decree passed ex parte, the Court may put the defendant to terms as to costs, payment into Court or otherwise. However, these requirements need to be visualized from a practical standpoint and cannot be applied as if to penalize the defendant for every mistake, even if the amount payable is not explicitly quantified in the decree in question………….”

Supreme Court noted that the decree in question had not been merely a money decree but has been eviction too. Looking to the subject matter of the suit and the overall circumstances, a practical view was required to be taken and if all any further deposit or furnishing of security was considered necessary, appropriate orders could have been passed in that regard. Putting it differently, in terms of Section 17 of the Act of 1887 read with Order IX Rule 13 CPC, the Court could have extended the time for making a deposit if so required, or could have put the defendant to the teams of security for performance of the decree.

The bench observed that the High Court while dismissing the petition filed by the appellants and endorsing the views of the Trial Court has proceeded to rely upon the decision in the case of Kedarnath v. Mohan Lal Kesarwari and Ors. that the provisions of Section 17 of the Act of 1887 are held to be mandatory. 

Further, the Supreme Court opined that reference to the said decision remains inapposite in the case. Even if the requirements of Section 17 of the Act of 1887 are held to be mandatory, the present one had not been a case where the defendant had altogether ignored those requirements.

The bench stated that “……………….in response to the queries of the Court, the appellants have immediately taken bonafide steps and have deposited the amount which may be relatable to rent/mesne profits until the month of April 2023. For this bonafide and prompt step, they do deserve an opportunity to contest the suit on merits, particularly when the matter relates to a shop where the predecessor of the appellants had been continuing as a tenant and the plaintiff-respondent is seeking the decree for eviction only on the ground of default in payment of rent……………”

In view of the above, the Supreme Court allowed the appeal and set aside the impugned order.

Case Title: Shyam Kumar Gupta & Ors. v. Shubham Jain

Bench: Justices Dinesh Maheshwari and Bela M. Trivedi 

Case No.: Petition (s) for Special Leave to Appeal (C) No. 2542/2023

Counsel for the Petitioner- Adva Desh Deepak Singh and Ruchir Ranjan Rai

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