Supreme Court Restores Trial Court Order, Holds Delay in Setting Aside Ex parte Decree Unexplained

A bench of Justices Sudhanshu Dhulia and K. Vinod Chandran heard an appeal against the High Court's order which had condoned a delay of 1,312 days and set aside an ex parte decree for specific performance. The petition arose from a challenge to the High Court's exercise of equitable jurisdiction in allowing the respondents' application to reopen a decree obtained by the appellant.

The Court allowed the appeal, set aside the High Court judgment and restored the Trial Court's order that had refused to condone the delay in filing the application to set aside the ex parte decree. The bench held that the respondents had failed to provide a satisfactory explanation for delay and that the factual matrix did not establish "sufficient hardship" warranting equitable relief. The Court emphasised that mere assertions of misplaced files or late handover by counsel did not excuse prolonged inaction, especially where respondents had participated in execution proceedings. The Court, in its reasoning, observed: "We are of the clear opinion that the impugned judgment was not on good grounds and the cost awarded and the directions for expeditious consideration would not unsettle the imbalance which would be caused to the plaintiff who had been waiting to get possession of the property for the last one decade. We are unable to accept the reasoning of the impugned order to condone the delay occasioned, because there is falsity writ large, in the submission of the lawyer having misplaced the files. The application to set aside the ex parte decree was only an afterthought and purely experimental. The law favours the diligent and not the indolent. We set aside the order of the High Court, thus restoring the order of the Trial Court rejecting the application for condonation of delay."

Background The dispute arose from a sale agreement dated 2013 in respect of a scheduled property jointly owned by two defendants. The first defendant executed a power of attorney in favour of the second defendant, who signed a sale agreement in favour of the plaintiff for Rs. 20 lakhs, of which Rs. 5 lakhs were paid; the plaintiff later deposited the balance consideration. The plaintiff filed a suit for specific performance in 2015. The first defendant appeared in the Trial Court but did not file a written statement and the Trial Court passed an ex parte decree on 13.04.2016. An execution petition followed and the legal representatives of the first defendant later appeared.

The first defendant died on 22.02.2017. An application to set aside the ex parte decree was filed on 04.01.2020 after condonation of delay by the High Court; the High Court had relied on precedents including Collector, Land Acquisition, Anantnag v. Mst. Katiji and H. Dohil Constructions Co. v. Nahar Exports to conclude that equitable relief was warranted, imposed costs of Rs. 1 lakh, and directed the filing of a written statement and expeditious disposal of the suit.

On appeal, the Supreme Court examined the chronology and evidence. It noted that the respondents had appeared in the execution proceedings on 20.08.2018 and therefore became aware of the ex parte decree; the Court held that if certified copies of the decree were not earlier procured, they could and should have been obtained once the respondents had appeared in execution. The Court found no cogent proof that the predecessor's ailment or brief hospitalisation excused the failure to file a written statement or to move promptly to set aside the decree. The Court distinguished the High Court's reliance on equitable considerations on the ground that delay was neither non-deliberate nor satisfactorily explained and that the attempt to re-open the decree was "an afterthought and purely experimental." The appeal succeeded and the Trial Court's refusal to condone delay was restored.

Case Details: Case No.: 2025 INSC 310 (S.L.P. (C) No. 2177 of 2024) Case Title: K. Ramasamy v. R. Nallammal & Ors. Appearances: For the Petitioner(s): Sri. Dama Seshadri Naidu, Senior Counsel For the Respondent(s): Sri. Gopal Shankarnarayanan, Senior Counsel