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M/S. Narain Agricultural ... vs Allahabad Bank

High Court Of Judicature at Allahabad|01 February, 1995

JUDGMENT / ORDER

ORDER
1. This revision is directed against the order passed by Sri Jagdishwar Singh, Civil Judge, Azamgarh on 10-11-1993 by which an application under Sections 148, 149 and 151, C.P.C. was allowed and the suit which was dismissed under Order 7, Rule 11, C.P.C. on 1-7-1992 was restored.
2. There is not much dispute about the facts. The respondent-Bank filed a suit for the recovery of Rs. 30,37,564/- against the present revisionist. The suit was filed on 22-12-1990 and time was sought for payment of court-fee which was granted. On 12-4-1991 the Bank purchased court-fee stamps worth Rupees 2,30,300/- from the Treasury and handed over the same to its counsel Sri Shyam Sunder Tripathi. Sri S. S. Tripathi filed court-fee stamps worth Rs. 3,000/- on 1st Aug., 1991, stamps worth Rs. 5,000/- on 3-12-1991 and stamps worth Rs.5,000/- on 27-2-1992. The remaining court-fee was not paid by Sri S. S. Tripathi, Advocate for the Bank and, therefore, the Court rejected the plaint under Order 7, Rule 11, C.P.C. on 1-7-1992.
3. In spite of the rejection of the plaint on 1-7-1992 the advocate (Sri S.S. Tripathi) repeatedly informed the Bank in writing that the suit is still pending. It appears that Sri S. S. Tripathi was the counsel for the Bank in a number of cases. On 15-5-1991 Sri S.S. Tripathi wrote a letter Annexure C.A.-1 to the Bank in respect of several cases which he was handling. The case of Narain Agricultural Corporation is item No. 10 in this letter. Sri S. S. Tripathi informed the Bank vide Annexure C.A.-1 that the entire court-fee has been deposited by him on 27-4-1991. On 24-3-1992 Sri S. S. Tripalhi wrote letter Annexure C.A.-3 to the regional office of the Bank and informed the Bank that the next date fixed in the case is 21-3-1991 and that the process has not been returned, and therefore, a reminder has been issued by the Court to the postal authorities. The advocate for the Bank also informed his client that the next date fixed in the case is 27-4-1992. Vide Annexure C.A.-5 dt. 31-7-1992 the counsel informed the Bank that the next date in the case is 7-8-1992. Another letter Annexure C.A.-6 was written by Sri S. S. Tripathi counsel for the Bank to the Branch Manager of the Bank and it was stated therein that the next date fixed in the case is 16-11-1992. On 16-11-1992 the advocate informed the Branch Manager that the next date is 8-12-1992 which is fixed for written statement disposal and issues. On 14-12-1992 the Bank was informed by its counsel that the next date fixed is 27-1-1993. This letter is Annexure C.A.-8. Another letter Annexure C.A.-9 was written by Sri S. S. Tripathi to the Bank Manager informing the latter that the next date is 27-3-1993. It is unnecessary to mention various other letters written by Sri S. S. Tripathi to the Bank.
These letters are Annexures C.A.-l I, C.A.-12 and C.A.-13. By these letters the Bank was informed from time to time about the alleged next date fixed in the case though the plaint had already been rejected long back on 1-7-1992.
4. On 21-6-1993 i.e. about one year after the rejection of the plaint Sri S. S. Tripathi wrote letter Annexure C.A.-2 to the Branch Manager of the Bank in which it was stated that originally the suit was filed deficiently stamped and valuation which was originally Rs. 21,37,573.79 P. was raised to Rupees 30,37,564.79 P. due to the subsequent interest. Sri S.S. Tripathi informed the Bank that he filed an amendment application which has been allowed and that the entire court-fee of Rs. 2,30,295/- was handed over to him in the shape of court-fee stamps purchased by the then Manager Sri Dubey. He again reiterated in this letter that the deficiency was made good by him on 27-4-1991 and tha the suit has been registered. This letter Annexure C.A.-2 also recites that a certified copy of the plaint duly registered was made available to the Branch.
5. On or about 11-10-1993 the true state of affairs became known to the Bank and, therefore, Sri A. K. Agrawal, Law Officer of the Bank, Sri R. N. Tripathi and Sri R. P. Tripathi, Branch Manager of the Bank called on the Advocate, Sri S. S. Tripathi and enquired about the payment of the court-fee. When Sri S. S. Tripathi, counsel for the Bank realised that the game is up he wrote letter Annexure C. A.-14, dt. 11-10-1993 in which he stated as under :
"Sir, I tender abject apology for not having paid the proper court-fee in the account of M/s. Narayan Agriculture Corporation as a result of which the suit filed against the said account was dismissed in July, 1992 under Order 7, Rule 11 (c), C.P.C. and I had been informing the dates to the Bank wrongfully."
6. In the same letter Sri S. S. Tripathi, counsel for the Bank came out with a story that court-fee stamps worth Rs. 2,30,300/-were handed over to him on 13-4-1991 but he could not deposit the same due to unavoidable circumstances and carried the stamps to his home in his briefcase. Next day he met with a serious accident when his scooter collided with an Ekka (horse driven carriage) and as a result of the accident he became unconscious and the papers which he was carrying in the briefcase were scattered on the road. After reaching his house he found some court-fee stamps missing. He says that he felt regretful but could not muster enough courage to bring the truth to the notice of the Bank. This letter Annexure C.A.-14 further says that he returned court-fee stamps worth Rs. 1,96,000/- to the officer of the Bank and regretted the loss of court-fee stamps worth Rs. 26,300/-. He also stated that due to lack of funds he is unable to make good the deficiency and the Bank may be kind enough to pay him Rs. 26,300/- so that he may get the suit restored. He promised to make good the loss later on.
7. It is, therefore, apparent from the admitted facts of the case that Sri S. S. Tripathi, Advocate for the Bank played a systematic fraud on the Bank. He not only failed to file the court-fee stamps in Court but also purposely kept the Bank in the dark and in spite of the rejection of the plaint on 1-7-1992, continued to feed wrong information to the Bank so that the Bank may remain under an impression that the suit is not only pending but is making progress.
8. When the real facts came to light the Bank filed application Annexure C.A.-15 under 0.7, R. 11 read with Ss. 148 and 151, C.P.C. In this application the Bank stated that court-fee stamps worth Rs. 2,30,000/-were purchased and handed over to its counsel and all the time the Bank believed in the counsel's version that the court-fee has been deposited. The application narrates the circumstances under which the Bank officers came to know of the real state of affairs. It says on 11-10-1993 Sri S. S. Tripathi informed the Bank that he is ill and will not be able to attend the Court. Therefore, the Branch Manager visited the Court to attend the case and then it was revealed that the plaint has been-rejected long back for non-
payment of deficit court-fee. Thereafter the Bank Manager and other Bank Officials went to the residence of their counsel who gave a letter to them (this letter is Annexure C.A.-14) which has already been quoted above. Along with this application Rajendra Prasad Tripathi, Branch Manager of the Bank, filed his affidavit Annexure C.A.-16.
9. Surprisingly Sri Shyam Sunder Tripathi, counsel for the Bank gave his own affidavit Annexure C.A.-17 in which he admits that he was engaged by the Bank for the recovery of the sum of Rs. 30,37,564.79 P. from the defendant-revisionist, that necessary court-fee amounting to Rs. 2,30,300/- was provided to him by the Bank and that the plaint was rejected by the Court on 1-7-1992 for non-payment of balance of court-fee. In para 10 of Annexure C.A.-17 Sri S. S. Tripathi has stated "that the non-deposit of. court-fee in time was not on account of the laches on the part of the plaintiff-Bank since the plaintiff had already provided me the entire court-fee well in time for depositing in the Court." In paragraphs 5, 6, 7 and 11 he has tried to absolve himself by saying that he met with accident. In para 12 he says that he met with another accident and was bed ridden till 12-10-1993.
10. It may be mentioned that along with the application Annexure C. A.-15 under O. 7, R. 11, C.P.C. and Ss. 148, 149 and 151, C.P.C. the Bank also filed an application under S. 5 of the Limitation Act which is Annexure C. A.-18. This application was supported by another affidavit sworn by the Manager of the Bank (Annexure C. A.-I9).
11. After taking into consideration the above facts which are almost admitted the learned Civil Judge passed the impugned order dt. 10-11-1993 and set aside the order for rejection of plaint dt. 1-7-1992 and condoned the delay in filing the deficient court-fee. While passing the order the learned Civil Judge observed as under :
"Thus it is well established in this case that it is the fault of plaintiff's counsel who intentionally and wrongfully withheld the stamps with him for a considerable time and did not deposit it in the Court. It is further evident that the conduct of the counsel Sri S. S. Tripathi has been highly objectionable and improper in wrongfully informing the Bank authorities that he has deposited the stamps in the Court and the case is proceed-ing; whereas the plaint had already been rejected on 1-7-1992. Therefore, I am of the view that in fact the Bank authorities were misled and misguided by the counsel Sri S. S. Tripathi due to his wilful wrong information".
12. Being aggrieved against the order of restoration of the suit the defendant has filed the present revision. I have heard Sri S. K. Verma, learned counsel for the defendant-revisionist and Sri R. K. Kakkar, learned counsel, for the respondent-Bank at length and have gone through the record.
13. The learned counsel for the revisionist himself has criticised the conduct of Sri S. S. Tripathi very badly. But it is contended by him that there was collusion between Sri S. S. Tripathi on the one hand and the Bank Officials on the other hand. In support of this. contention it is pointed out that even after the fraud played by the counsel on the Bank was discovered, the Bank retained the services of the Advocate and the restoration application is signed by Sri S. S. Tripathi as well as by another counsel Sri Saxena. A photo copy of the restoration application has been filed on behalf of revisionist which is supplementary rejoinder affidavit No. 1 which no doubt bears the signature of two advocates. It is pointed out on behalf of the revisionist that a copy of the restoration application has been filed by the respondent-Bank and the said copy is Annexure C.A.-15. It is argued that Annexure C.A.-15 does not show the signatures of any advocate. The contention is that deliberately a photo copy has been produced in which the signatures of the advocates have been eliminated. Another ground on which the theory of collusion between Sri S. S. Tripathi and the Bank Officials has been advanced is the fact that the court-fee stamps which were purchased for the filing of the suit against the revisionist were used by the Bank in various other suits filed by the Bank against the other parties.
14. This contention has no substance. When the Bank relied on the affidavit of Sri S.S. Tripathi in respect of the restoration application, it had no reason to conceal the fact that the restoration application was signed by Sri S. S. Tripathi along with another counsel Sri Saxena. So far as the use of court-fee stamps purchased for this suit being used for filing other suits is concerned the Bank has explained the correct position in pages 9 and 10 of the supplementary counter-affidavit sworn on 28-2-1994. In para 18 of the S.C.A. the Bank has explained that Sri S. S. Tripathi was the counsel for the Bank in a number of cases. The court-fee stamps worth more than rupees three lacs were given to Sri S. S. Tripathi by the Bank some of those stamps were misused by Sri S. S. Tripathi in filing other suits on behalf of the Bank though for filing those other suits cash payment had been made to Sri S. S. Tripathi for the purchase of court-fee stamps. The details of those suits and the details of cash payment made by the Bank to Sri S. S. Tripathi are narrated in detail in the S.C.A. The Bankers cheque issued to Sri S. S. Tripathi and other vouchers showing cash payment to him for the purchase of court-fee in connection with other cases is proved from Annexure S.C.A.-1 to Annexure S.C. A.-6. In order to support the theory of collusion between the Bank Officials and Sri S. S. Tripathi, the learned counsel for the revisionist has argued that in spite of the alleged fraud played by Sri S. S. Tripathi the Bank retained him as its advocate and did not take any legal action against him. This allegation is also controverted by the Bank at page 3 of the supplementary affidavit in which it is stated in para 6 that the Bank has withdrawn and taken back all of its eases which were conducted by Sri S. S. Tripathi, advocate and applications have been filed in those cases that his Vakalatnama is cancelled with immediate effect. In para 6 of the S.C.A. at page 4 the details of the cases withdrawp by the Bank from Sri S. S. Tripathi is given. It is also stated in para 6 of the supplementary affidavit that a legal notice for repayment of the misappropriated court-fee amount has been served by the Bank through Sri S. N. Rai, Advocate and it has been received by Sri S. S. Tripathi on 13-1-1994 and the Bank is going to file a suit. Sri R. K. Kakkar, counsel for the respondent-Bank has made a statement at the Bar that the Bank, has already filed a complaint before the Bar Council against Sri S. S. Tripathi and that the suit has also been filed.
15. In view of these fact's there is no substance in the contention that there was any collusion between Sri S. S. Tripathi on the one hand and the Bank Officials on the other hand. In fact the position appears just the reverse. It is a clear case of collusion between Sri S. S. Tripathi and the defendant-revisionist. The culpable conduct of Sri S.S. Tripathi could have benefitted only one party and that is the defendant. The suit which was filed against the defendant was for the recovery of more than thirty lacs of rupees and even the interest on this amount will be about Rs. 30,000/- per month. In this way only the defendant-revisionist is benefitted by the delay of about four years since the institution of the suit on 22-12-1990.
16. After having considered the factual aspect of the matter, the legal aspect may be taken up. The first contention on behalf of the defendant-revisionist is that the rejection of the plaint under O.7, R. 11, C.P.C. amounts to a decree as per the definition of decree under S. 2, sub-clause (2), C.P.C. which clearly says so. On this basis it is argued that the rejection of the plaint is appealable and, therefore, there is no scope for filing an application under Sec. 151, C.P.C. It is contended by the learned counsel for the revisionist that when there is a statutory remedy available, the Court cannot resort to the provision of S. 151, C.P.C. In support of this contention the learned counsel has cited 1964 (5) SCR 946 at 968, AIR 1964 SC 993, AIR 1966 SC 1899 at pages 1901-1902, AIR 1965 SC 364 at page 399, AIR 1980 Orissa 162, 1985 All LJ 716 and 1988(3) JT (SC) 72 (2).
17. The learned counsel for the respondent has placed reliance on AIR 1957 All 825, AIR 1981 All 15 and AIR 1990 Orissa 102, in support of the contention that notwithstanding the fact that an appeal may be filed against the rejection of the plaint, an application under S. 151, C.P.C. is maintainable. One of the cases on which reliance has been placed'on behalf of the revisionist is AIR 1980 Orissa 162. This case has been referred to in AIR 1990 Orissa 102 and it has been held in para 4 that the Code no doubt makes a provision for appeal to a higher court against an order rejecting a plaint under Order 7, Rule 11, C.P.C. for non-payment of court-fee, but there is no provision in the Code for redress in the very same Court. Thus the applicability of inherent powers of the Court does not stand excluded. In para 3 at page 104 it was observed that right of appeal to a higher forum does not override nor is in conflict with the inherent powers of a Court saved under S. 151 of the Code.
18. So far as this Court is concerned it was held as back as 1957 in AIR 1957 All 825, Sita Ram Sahu v. Kedarnath Sahu, para 4 that the right of appeal does not bar the filing of the application under S. 151, C.P.C. in alt cases. The observations made in this case are as under :
"A Court always has power to recall order which had the effect of perpetrating an injustice on a party. The order which was recalled in this particular, case was based on an earlier order, namely, the order refusing to grant further time to the plaintiff to make good the deficiency. That order was made on the assumption that the plaintiff's illness was not genuine. It was open to the Court, in our view, to reconsider the position when material was placed before it which showed clearly that the contention of the plaintiff that he was ill was substantially true."
19. In AIR 1981 All 15, Firm ,M/s. Devesh Kumar Viresh Kumar v. 5th Additional District Judge, Aligarh, in almost simitar circumstances the trial Court rejected the application under S. 151, C.P.C. as not maintainable on the ground that the plaintiff had its remedy only by way of appeal. This order was reversed by the Additional District Judge in revision. In a writ petition filed by the defendant-firm this Court held that the District Judge is right that the application filed by the plaintiff was maintainable. It was observed that the aggrieved parties have two alternative remedies depending on the circumstances of the case. He may file a regular appeal or may file an application under Ss. 148, 149 and 151 of the Civil P. C. if the circumstances so permit. The first contention, therefore, has no force.
20. The next contention on behalf of the revisionist is that the order rejecting the plaint has been set aside by the learned Civil Judge without issuing any notice to the defendant and, therefore, the order is not only bad in law but is also without jurisdiction. In support of this contention the iearned counsel for the revisionist cited AIR 1976 Pat 286 and (1883) ILR 5 All 380. It is also argued that in recent years the Courts have emphasised the application of rules of natural justice which require that an order adverse to the party should not be passed without affording an opportunity of hearing.
21. I have given careful consideration to the matter but this contention cannot be upheld. AIR 1976 Pat 286 relied upon by the learned counsel was a case under O.9, R. 9, C. P.C. In that case an application for grant of probate was dismissed in default and an application for restoration was also dismissed in default. Application for restoration of application under O.9, R, 9 was allowed without giving notice to the opposite party and, therefore, the order was held to be illegal. This case is, therefore, clearly distinguishable on facts.
22. The learned counsel for the respondent has cited AIR 1953 SC 431, Mahasay Ganesh Prasad Ray v. Narendra Nath Sen in which it has been observed in para 5 that the question Of payment of court-fee is primarily a matter between the Government and the person concerned and, therefore, where the High Court grants time for payment of deficient court-fee under S. 149, C.P.C., the other party cannot attack the order on the ground that it takes away his valuable right to plead the bar of limitation. Another authority cited on behalf of the respondent is AIR 1975 Raj 150, Gulam Abbas v. Shri Kalyan Finance Co. It may also be pointed out by way of analogy that where a suit is dismissed in default of appearance of both the parties under O.9, R. 3, C.P.C. and an application is filed by the plaintiff for restoration under O.9, R. 4, C.P.C., no notice to the defendant is required because the defendant was not present when the suit was dismissed. Similarly in the instant case the plaint was rejected before any notice was issued to the defendant and admittedly the defendant was not present when the plaint was rejected under O.7, R. 11, C.P.C. It is clearly stated in paras 11 and 13 of the counter-affidavit that the defendants were neither served nor they were present at the time when the plaint was rejected. Therefore, no notice to the defendant was required to be given.
23. The next contention on behalf of the revisionist is that the plaintiff in the instant case was not a rustic villager. The Bank has its own legal department and, therefore, the Bank cannot rely on the plea that its counsel failed to inform it of the rejection of the plaint. It is argued that if the Bank Officials had exercised due diligence they could have found out that the plaint has been rejected or they could have supplied the deficient court fee before the rejection of the plaint. It is argued that the client cannot always take shelter behind the inaction or negligence on the part of the counsel. Reliance is placed on 1992 All WC 586 ; (AIR 1992 All 233), Om Prakash Malhotra v. Smt. Nirla Kumari in which it has been held that there is no general principle that a party should always be saved from the mistakes of its counsel and that every inaction or negligence of the counsel is not to be taken lightly or condoned. Another authority that has been cited in this connection on behalf of the revisionist is Salil Dutta v. T.M. & M.C.Pvt. Ltd., 1993(4) JT(SC)528:(1993 AIR SCW 1178). In the cited case no appearance was made by defendant or its advocate and an ex parte decree was passed against the defendant. The Hon'ble Supreme Court distinguished the case of Rafiq v. Munshi Lal reported in AIR 1981 SC 1400 and observed that where the defendant is a private limited company run by educated businessmen, putting the entire blame upon the advocate and trying to make it out as if the defendants were totally unaware of the nature or significance of the proceedings is a theory which cannot be accepted.
24. This case is clearly distinguishable inasmuch as the client may not take advantage in all case of the inaction or negligence on the part of the advocate and he may be expected to be reasonably diligent in finding out as to what is happening in the case. But where the counsel not only fails to inform the client but deliberately misleads him and practises systematic fraud on the client, the client is entitled to all the assistance from the Court for setting right the injustice done to him.
25. This Court has already come to the conclusion in para 15 above that there was no collusion between any officer of the Bank with Sri S. S. Tripathi. The collusion was between Sri S. S. Tripathi and the defendant-revisionist. On enquiry, this Court was told that Sri S. S. Tripathi is about 50 years of age and he had about 20 years' experience at the Bar. The Bank engaged him for filing high valuation suit and entrusted a number of cases to him. An advocate of such a long standing could not have deviated from his professional duty for some petty gain like using the court-fee amount of other cases entrusted to him. It appears that the revisionist somehow induced the Advocate (Sri S. S. Tripathi) to act in this manner so that the defendant-revisionist may escape liability for payment of about thirty lacs of rupees or at any rate to delay the process of recovery. It appears that the defendant and Sri S. S. Tripathi entered into a criminal conspiracy to cause undue loss to the Bank and to cause unlawful gain to the revisionist. The conspiracy was to cheat the Bank of its legitimate dues. The Bank has already filed a complaint before the Bar Council against the Concerned Advocate but mere debarring him from practise may not be sufficient. Filing of a criminal case against the concerned Advocate under S. 420, I.P.C. and allied sections may become necessary. The defendant-revisionist should also be jointly prosecuted along with the Advocate unless one or the other (or both of them) are able to satisfy this Court that the launching of criminal prosecution against them is not expedient in the interest of justice.
In view of above discussion, this Court orders as under :
(i) Notice may be issued to Sri S. S. Tripathi, Advocate, practising at Azamgarh and also to the defendant-revisionist to show cause as to why they may not be prosecuted in a criminal Court.
(ii) The Registrar of this Court is directed to open a miscellaneous file for this purpose and all necessary steps may be taken to ensure service of notice through the Chief Judicial Magistrate, Azamgarh as well as by registered post within a period of one month.
(iii) The miscellaneous case, registered in pursuance of the above order, may be listed before this Bench on 30th March, 1995.
(iv) The revision is dismissed with costs which is assessed at Rs. 10,000/- (rupees ten thousand) only. The stay order dt. 6-11-1993 is vacated and the trial Court is directed to expedite the disposal of the suit.
(v) A copy of this judgment may be sent to Bar Council, Uttar Pradesh, Allahabad and also to the trial Court.
26. Order accordingly.
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Title

M/S. Narain Agricultural ... vs Allahabad Bank

Court

High Court Of Judicature at Allahabad

JudgmentDate
01 February, 1995
Judges
  • O Jain