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Gujarat High Court

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Limitation Act, 1963 – s.5 – Condonation of delay – Appeal by Government Corporation against judgment and decree in civil suit – Also application under for condonation of delay of 4 years – Allowed by Division Bench – Justification of – Held: Not justified – Law Department of the Government Corporation did not approach High Court with clean hands – High Court committed grave error by condoning more than four years’ delay in filing of appeal ignoring the judicially accepted parameters for exercise of discretion u/s. 5 – Thus, order of High Court set aside – Application for condonation of delay dismissed – Civil Procedure Code, 1908 – O 41 r. 3A. The question which arose for consideration was whether the Division Bench of High Court was justified in condoning more than four years’ delay in filing of appeal by the respondents against judgment and decree passed by the Civil Judge in the Special Civil Suit. =Allowing the appeal, the Court HELD: 1.1. The law of limitation is founded on public policy. The legislature does not prescribe limitation with the object of destroying the rights of the parties but to ensure that they do not resort to dilatory tactics and seek remedy without delay. The idea is that every legal remedy must be kept alive for a period fixed by the legislature. To put it differently, the law of limitation prescribes a period within which legal remedy can be availed for redress of the legal injury. At the same time, the courts are bestowed with the power to condone the delay, if sufficient cause is shown for not availing the remedy within the stipulated time. The expression “sufficient cause” employed in section 5 of the Limitation Act, 1963 and similar other statutes is elastic enough to enable the courts to apply the law in a meaningful manner which sub serves the ends of justice. Although, no hard and fast rule can be laid down in dealing with the applications for condonation of delay, this Court has justifiably advocated adoption of a liberal approach in condoning the delay of short duration and a stricter approach where the delay is inordinate. [Para 8] [1184-c-e] Collector, Land Acquisition, Anantnag v. Mst. Katiji (1987) 2 SCC 107; N. Balakrishnan v. M. Krishnamurthy (1998) 7 SCC 123; Vedabai v. Shantaram Baburao Patil (2001) 9 SCC 106, relied on. 1.2. In dealing with the applications for condonation of delay filed on behalf of the State and its agencies/instrumentalities this Court has, while emphasizing that same yardstick should be applied for deciding the applications for condonation of delay filed by private individuals and the State, observed that certain amount of latitude is not impermissible in the latter case because the State represents collective cause of the community and the decisions are taken by the officers/agencies at a slow pace and encumbered process of pushing the files from table to table consumes considerable time causing delay. [Para 8] [1184-f-h; 1185-a] G. Ramegowda v. Spl. Land Acquisition Officer (1988) 2 SCC 142; State of Haryana v. Chandra Mani (1996) 3 SCC 132; State of U.P. v. Harish Chandra (1996) 9 SCC 309; State of Bihar v. Ratan Lal Sahu (1996) 10 SCC 635; State of Nagaland v. Lipok Ao (2005) 3 SCC 752; State (NCT of Delhi) v. Ahmed Jaan (2008) 14 SCC 582, relied on. 2.1. A reading of the impugned order makes it clear that the High Court did make a bald reference to the application for condonation of delay filed by the respondents but allowed the same without adverting to the averments contained therein and the reply filed on behalf of the appellant. The High Court erroneously assumed that the delay was of 1067 days, though, as a matter of fact, the appeal was filed after more than four years. Another erroneous assumption made by the High Court was that the appellant had not filed reply to controvert the averments contained in the application for condonation of delay. It may have been possible for this Court to ignore the first error in the impugned order because by deleting the figures and words “4 years and 28” in paragraphs 2 and 3 of the application and substituting the same with the figure 1067, the respondents misled the High Court in believing that the delay was of 1067 days only but it is not possible to fathom any reason why the Division Bench of the High Court omitted to consider the detailed reply which had been filed on behalf of the appellant to contest the prayer for condonation of delay. Notwithstanding this, the impugned order may have been set aside and remitted the case to the High Court for fresh disposal of the application filed by the respondents under section 5 of the Limitation Act but, it is not proper to adopt that course because the respondents did not approach the High Court with clean hands. [Para 10] [1185-a-h; 1186-a] 2.2. It is clear that the Law Department of respondent No.1 was very much aware of the proceedings of the first as well as the second suit. In the first case, RM was appointed as an advocate and in the second case BR was instructed to appear on behalf of the respondents, but none of the officers is shown to have personally contacted either of the advocates for the purpose of filing written statement and preparation of the case and none bothered to appear before the trial Court on any of the dates of hearing. It is a matter of surprise that even though an officer of the rank of General Manager (Law) had issued instructions to RM to appear and file vakalat as early as in May 2001 and Manager (Law) had given vakalat to BR Advocate in the month of May 2005, in the application filed for condonation of delay, the respondents boldly stated that the Law Department came to know about the ex parte decree only in the month of January/February 2008. The respondents went to the extent of suggesting that the parties may have arranged or joined hands with some employee of the corporation and that may be the reason why after engaging advocates, nobody contacted them for the purpose of giving instructions for filing written statement and giving appropriate instructions which resulted in passing of the ex parte decrees. The above statement is not only incorrect but is ex facie false and the High Court committed grave error by condoning more than four years’ delay in filing of appeal ignoring the judicially accepted parameters for exercise of discretion under section 5 of the Limitation Act. [Para 13] [1187-g-h; 1188-a] 2.3. The impugned order of the High Court is set aside and the application for condonation of delay filed by the respondents is dismissed. As a corollary, the appeal filed by the respondents against judgment and decree dated 30.10.2004 shall stand dismissed as barred by time. However, it is made clear that the disposal of the instant appeal shall not absolve the higher functionaries of respondent No.1 from the responsibility of conducting a thorough probe into the matter so that accountability of the defaulting officers/officials may be fixed and the loss, if any, suffered by respondent No.1 recovered from them after complying with the rules of natural justice. [Para 14] [1188-b-c] State of Bihar and others v. Kamleshwar Prasad Singh and another 2000 AIR SC 2388; Spl. Tehsildars, Land Acquisition, Kerala v. K.V. Ayisumma AIR 1996 SC 2750; Punjab Small Industries and Export Corporation Ltd. and others v. Union of India and others 1995 Suppl. (4) SCC 681; P.K. Ramachandran v. State of Kerala and another (1997) 7 SCC 566, referred to. Case Law Reference: 2000 AIR SC 2388 Referred to Para 5 AIR 1996 SC 2750 Referred to Para 5 1995 Suppl. (4) SCC 681 Referred to Para 5 (1997) 7 SCC 566 Referred to Para 5 (1987) 2 SCC 107 Relied on Para 8 (1998) 7 SCC 123 Relied on Para 8 (2001) 9 SCC 106 Relied on. Para 8 (1988) 2 SCC 142 Relied on Para 8 (1996) 3 SCC 132 Relied on Para 8 (1996) 9 SCC 309 Relied on Para 8 (1996) 10 SCC 635 Relied on Para 8 (2005) 3 SCC 752 Relied on Para 8 (2008) 14 SCC 582 Relied on. Para 8 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2075 of 2010. From the Judgment & Order dated 25.3.2009 of the High Court of Gujarat at Ahmedabad in Civil Application No. 14201 of 2008 in First Appeal No. 4180 of 2008. L.N. Rao, Nikhil Goel, Naveen Goel, Marsoak Bafaki, Sheela Goel for the Appellant. Anip Sachthey, Mohit Paul, Shagun Matta, Sherin Daniel for the Respondents.

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION Civil Appeal No.2075 of 2010 (Arising out of S.L.P. (C) No.10965 of 2009) Oriental Aroma Chemical Industries Ltd. …Appellant Versus Gujarat Industrial Development Corporation …Respondents and another J U D G M E N T G.S. Singhvi, J. 1. Leave granted. 2. Whether the Division … Continue reading

whether priority given to the dues payable by an employer under Section 11 of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (for short, `the EPF Act’) is subject to Section 529A of the Companies Act, 1956 (for short, `the Companies Act’) in terms of which the workmen’s dues and debts due to secured creditors are required to be paid in priority to all other debts.= we would emphasize that in terms of Section 530(1), all revenues, taxes, cesses and rates due from the company to the Central or State Government or to a local authority, all wages or salary or any employee, in respect of the services rendered to the company and due for a period not exceeding 4 months all accrued holiday remuneration etc. and all sums due to any employee from provident fund, a pension fund, a gratuity fund or any other fund for the welfare of the employees maintained by the company are payable in priority to all other debts. This provision existed when Section 11(2) was inserted in the EPF Act by Act No. 40 of 1973 and any amount due from an employer in respect of the employees’ contribution was declared first charge on the assets of the establishment and became payable in priority to all other debts. However, while inserting Section 529A in the Companies Act by Act No.35 of 1985 Parliament, in its wisdom, did not declare the workmen’s dues (this expression includes various dues including provident fund) as first charge. The effect of the amendment made in the Companies Act in 1985 is only to expand the scope of the dues of workmen and place them at par with the debts due to secured

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 9630 O F 2011 (Arising out of Special Leave Petition (Civil) No. 7642 of 2011) Employees Provident Fund Commissioner … Appellant(s) Versus O.L. of Esskay Pharmaceuticals Limited … Respondent(s) With CIVIL APPEAL NO. 9633 O F 2011 (Arising out of Special Leave … Continue reading

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