TaxTMI 
TaxTMI 
2003 (11) TMI 348
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed States of America need not be recited, it must be noticed that in the proceeding before the United States Court, leading to the decree, the defendant, i.e., the respondent-company appeared pursuant to the summons received and filed an application asserting lack of jurisdiction of the Court. No written statement setting up any particular defence was filed by the respondent-company, i.e., the defendant in the suit, who had subsequently withdrawn from the said proceeding by filing an application to that effect. It must also be noticed, at this stage, that the decree in respect of which the default, is alleged to have occurred, has attained finality, inasmuch as, no appeal against the said decree has been filed by the respondent-company. At the same time, it must be noted that no proceeding for execution of the decree, passed by the District Court of the Untied States of America, has been initiated by the petitioner-company, i.e., the decree holder either in the United States or in the courts in India. 2. Arguing for the winding up of the respondent-company, Dr. A.K. Saraf, learned counsel for the petitioner, has submitted that the decree passed by the District Court of the United ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iddle District of North Carolina is evidently erroneous inasmuch as the mere visits of the representatives of the respondent- company to a place within the jurisdiction of the said District Court for discussions with regard to the transaction in question and the availability of an internet website of the respondent-company to advertise and promote its products in the middle district of North Carolina would not be sufficient to clothe the court with the necessary jurisdiction. Learned counsel has further argued that the decree passed is an ex-parte decree, based on a consideration of the case of the plaintiff alone and that on the ratio of the law laid down by the Privy Council in the case of D.T. Keymer v. P. Visvanatham Reddi AIR 1916 PC 121, as well as in view of the law laid down by the Apex Court in the case of International Woollen Mills v. Standard Wool (U.K.) Ltd. [2001] 5 SCC 265, the decree in question would not be one on the merits of the case. Learned counsel has further argued that in determining the entitlement of the plaintiff, i.e., the petitioner-company to damages, section 73 of the Indian Contract Act has been ignored and brushed aside by the United States Court; ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....idence and materials produced by the plaintiff in support of its case. As already noted, the defendant in the suit, i.e., the respondent-company had not filed any written statement setting up any positive defence, the only stand taken by the defendant is the one relating to the lack of jurisdiction of the US court. The question, therefore, that would arise is whether the judgment and decree passed in the ex-parte proceeding would be the judgment and decree on the merits of the case within the meaning of clause (b) of section 13 of the Code of Civil Procedure. The law laid down by the Privy Council in the case of D.T. Keymer (supra), must be understood in the facts and circumstances of the case before the Privy Council. In the aforesaid case, the claim for the money made by the plaintiff was denied by the defendant by asserting that he was not a partner of the firm in question and further that no amount of money was due by him. The defence having been put, the plaintiff prayed for liberty to exhibit certain interrogatories and liberty being granted, the interrogatories were exhibited and the defendant was called upon to reply to the same. The defendant having failed to answer the in....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... decision was passed on consideration of the truth or otherwise of the plaintiff's claim. If the evidence adduced on behalf of the plaintiff receives consideration of the court and the judgment and decree is passed on such consideration, even if the suit is decreed in the absence of the defendant, the judgment may still be one on the merits of the case. Applying the ratio of the law laid down by the Apex Court in the case of International Woollen Mills (supra), what can be found from the judgment passed by the US Court, is that there has been an elaborate consideration of the case set up by the plaintiff in the suit on the basis of the materials and evidence brought on record by the plaintiff. The damages quantified and awarded by the decree were on the basis of the projections contained in the pleadings and adequate grounds and reasons for the same are cited. The defendants not having set up any positive case in defence or in counter, no consideration of the case of the defendant could reasonably arise. In such a situation, this court is of the considered view that the decision of the US District Court cannot be said to be not a decision on the merits of the case so as to attract ....