Company wins recall of ex-parte decree due to improper service under Order IX Rule 13 CPC

The Calcutta HC allowed a petition to recall an ex-parte decree under Order IX Rule 13 CPC. The defendant company was not properly served with the original plaint, amended plaint, or writ of summons due to incorrect/insufficient address, with multiple service attempts failing. The defendant only learned of the suit when it received a reply from plaintiff's advocate regarding an arbitration notice. The court found the plaintiff suppressed material facts about incomplete service to secure transfer to the undefended list, constituting abuse of process. The ex-parte decree was set aside as the defendant was denied the basic right to defend.

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Issues Involved:

1. Whether the ex-parte decree dated June 12, 2019, should be set aside under Order IX Rule 13 of the Code of Civil Procedure, 1908.
2. Whether the summons were duly served upon the defendant.
3. Whether there was suppression of material facts by the plaintiff.
4. Whether the plaintiff committed fraud by not informing the court about the change of address of the defendant.
5. Whether the transfer of the suit to the undefended list was justified.

Detailed Analysis:

1. Setting Aside the Ex-Parte Decree:

The primary issue was whether the ex-parte decree should be set aside under Order IX Rule 13 of the CPC. The court noted that under this provision, an ex-parte decree can be set aside if the summons were not duly served or if the defendant was prevented by sufficient cause from appearing. The court emphasized that the defendant must demonstrate either condition to warrant setting aside the decree.

2. Service of Summons:

The court examined whether the summons were duly served on the defendant. The evidence showed that attempts to serve the writ of summons through the District Judge, Raipur, and via speed post were unsuccessful. The Deputy Sheriff's report indicated that the premises were vacated by the defendant three years prior, and the speed post was marked "refused" or "insufficient address." The court found that the summons were not duly served as the defendant had moved to a new address, which was not updated in the court records.

3. Suppression of Material Facts:

The court considered whether the plaintiff suppressed material facts. It was observed that the plaintiff failed to disclose the change of the defendant's address, which was a material fact. The court cited the principle of uberrima fides, requiring litigants to approach the court with clean hands and disclose all relevant facts. The suppression of the defendant's new address was deemed a material omission that impacted the merits of the case.

4. Alleged Fraud by Plaintiff:

The defendant argued that the plaintiff committed fraud by not informing the court about the change of address. The court found merit in this argument, noting that the plaintiff was aware of the new address but did not amend the plaint accordingly. The court held that the plaintiff's actions amounted to an abuse of process and deliberate fraud, as they failed to ensure the defendant was properly notified of the proceedings.

5. Transfer to Undefended List:

The court scrutinized the transfer of the suit to the undefended list. It was noted that the suit was transferred despite the pending service of the writ of summons and plaint. The court highlighted that such transfer was improper, given the incomplete service. The rules of the High Court at Calcutta (Original Side) were cited, indicating that a suit should not be transferred to the undefended list without proper service.

Conclusion:

The court concluded that the ex-parte decree dated June 12, 2019, should be set aside due to the improper service of summons and the suppression of material facts by the plaintiff. The application to recall the decree was allowed, and the defendant was directed to file a written statement within 45 days. The court emphasized that the plaintiff's conduct in securing the transfer of the suit to the undefended list was an abuse of process, and the defendant was denied the opportunity to defend its case due to the plaintiff's actions.

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