When counsel reports no instructions, it is the duty of the Court to issue notice to the party concerned before proceeding further in the matter

Every litigant ought to be afforded an opportunity of deciding the issue involved on merits without the same being scuttled on mere technicalities

    In the said backdrop, if the decision in Smt. Garuda Sakuntala (supra), as relied upon by the learned advocate for the appellants - plaintiffs is taken into consideration, it held therein that, 'Past conduct of a party regarding default in appearance cannot be taken into consideration while deciding the question as to whether there was 'sufficient cause' for non- appearance of the party on a particular subsequent date i.e. the date on which the latest default is committed. The Court below is not justified in adverting to the previous conduct of the appellant/plaintiff while refusing to set aside the default dismissal order. The Court below ought to have considered whether there was sufficient cause for the absence of the appellant/plaintiff on 15.2.1993 only, and not the previous conduct of the appellant. Hence, the contention of the counsel for respondents, that in view of the previous conduct of the appellant in not attending the court the lower court is right in dismissing the suit for default, cannot be accepted'. It is further held that, 'Apart from that, admittedly, the appellant/plaintiff engaged an advocate to represent her case, and it appears that the said advocate did not make any representation on behalf of the appellant/plaintiff. When the counsel reports no instructions, it is the duty of the Court to issue notice to the party concerned before proceeding further in the matter. In this case, no notice is issued to the appellant/plaintiff by the court below to that effect. On this ground also, the order under appeal is liable to be set aside'. The Court has observed that, 'Dismissal of a suit for default of the plaintiff shall always be resorted to by the courts with utmost circumspection. Before passing such default dismissal order, the Courts should keep in view the hardship that may be caused to the plaintiff in deserving cases, of course with exceptions depending on the fact-situation of a given case, because the dismissal of a suit for default of plaintiff operates as a bar for bringing a fresh suit on the same cause of action. The procedural laws are intended to do substantial justice between the parties and not to penalize the parties'. Thus, as observed in the aforesaid decision, it is the

duty of the Court to issue notice to the party concerned before proceeding further in the matter and before passing such default dismissal order, the Courts should keep in view the hardship that may be caused to the plaintiff in deserving cases, of course with exceptions depending on the fact-situation of a given case, because the dismissal of a suit for default of plaintiff operates as a bar for bringing a fresh suit on the same cause of action. In the case on hand also, the learned advocate representing the appellants - plaintiffs did not remain present as not keeping well and eventually, the suit came to be dismissed for default, however, no prior notice appears to have been issued to the appellants - plaintiffs.[Para No.6.2]

    Adverting to the facts of the present case, the learned trial Judge has dismissed the suit for default for want of prosecution and by way of impugned order, also dismissed the application for restoration of the said suit. It was the case of the appellants - plaintiffs that since the learned advocate representing the case of the appellants - plaintiffs before the trial Court was not keeping well, he did not remain present before the Court on the date so appointed, however, the learned trial Judge did not appreciate the said fact and considering the past conduct viz. non- appearance of appellants - plaintiffs dismissed the suit for default observing that the suit is aged 10 years. It is settled law as reflected in the decision in Smt. Garuda Sakuntala (supra) that past conduct of a party regarding default in appearance cannot be taken into consideration while deciding the question as to whether there was 'sufficient cause' for non-appearance of the party on a particular subsequent date i.e. the date on which the latest default is committed and the Court below is not justified in adverting to the previous conduct of the appellant/plaintiff while refusing to set aside the default dismissal order. Further, as held therein, when the counsel reports no instructions, it is the duty of the Court to issue notice to the party concerned before proceeding further in the matter. In this case, indisputably, the learned trial Judge has taken into consideration the past conduct of the appellants - plaintiffs while dismissing the suit for default and admittedly, no prior notice appears to have been issued to the appellants - plaintiffs by the learned Court below to that effect.[Para No.6.5]

When addressee refuses to accept registered post, it is presumed due service and knowledge of contents of letter can always be imputed on the addressee

Coming to the issue regarding the alleged non-service of notice under Section 106 of the Act on the appellant, a bare look at the Exhibit-6, which is an undelivered Registered A/D envelop sent to the appellant reveals that the same was sent by the counsel for the plaintiff to the appellant. The appellant in his statement admitted that the address indicated on the envelop was correct. The envelop clearly bears the endorsement made by the postman regarding refusal to receive the article. It is well settled that a notice sent under Section 106 of the Act, if refused by the tenant, the same is a sufficient service of the notice.

    Hon'ble Supreme Court in Puwada Venketeswara Rao v. Chidamana Venkata Ramana : AIR 1976 SC 869, observed that where a notice by registered post is returned with endorsement 'refused' it is not always necessary to produce the postman who tried to affect the service.

    In Gujarat Electricity Board & Anr. v. Atmaram Sungomal Poshani : 1989 (2) SCC 602, the Supreme Court observed as under:

"8. There is presumption of service of a letter sent under registered cover, if the same is returned back with a postal endorsement that the addressee refused to accept the same. No doubt the presumption is rebuttable and it is open to the party concerned to place evidence before the Court to rebut the presumption by showing that the address mentioned on the cover was incorrect or that the postal authorities never tendered the registered letter to him or that there was no occasion for him to refuse the same. The burden to rebut the presumption lies on the Party, challenging the factum of service. In the instant case the respondent failed to discharge this burden as he failed to place material before the Court to show that the endorsement made by the postal authorities was wrong and incorrect. Mere denial made by the respondent in the circumstances of the case was not sufficient to rebut the presumption relating to service of the registered cover. We are, therefore, of the opinion that the letter dated 24-4-1974 was served on the respondent and he refused to accept the same. Consequently, the service was complete and the view taken by the High Court is incorrect."

Complaint u/s. 138 of N.I. Act for cheque bounce is maintainable if cheque is presented and gets dishonoured for the second time after the period of first demand notice is expired

The expression ‘cause of action’ appearing in Section 142 (b) of the Act cannot therefore be understood to be limited to any given requirement out of the three requirements that are mandatory for launching a prosecution on the basis of a dishonoured cheque. Having said that<, every time a cheque is presented in the manner and within the time stipulated under the proviso to Section 138 followed by a notice within the meaning of clause (b) of proviso to Section 138 and the drawer fails to make the payment of the amount within the stipulated period of fifteen days after the date of receipt of such notice, a cause of action accrues to the holder of the cheque to institute proceedings for prosecution of the drawer.[Para No.20]

    There is, in our view, nothing either in Section 138 or Section 142 to curtail the said right of the payee, leave alone a forfeiture of the said right for no better reason than the failure of the holder of the cheque to institute prosecution against the drawer when the cause of action to do so had first arisen. Simply because the prosecution for an offence under Section 138  must on the language of Section 142 be instituted within one month from the date of the failure of the drawer to make the payment does not in our view militate against the accrual of multiple causes of action to the holder of the cheque upon failure of the drawer to make the payment of the cheque amount. In the absence of any juristic principle on which such failure to prosecute on the basis of the first default in payment should result in forfeiture, we find it difficult to hold that the payee would lose his right to institute such proceedings on a subsequent default that satisfies all the three requirements of Section 138.[Para No.21]

    That brings us to the question whether an offence punishable under Section 138 can be committed only once as held by this Court in Sadanandan Bhadran’s case (supra). The holder of a cheque as seen earlier can present it before a bank any number of times within the period of six months or during the period of its validity, whichever is earlier. This right of the holder to present the cheque for encashment carries with it a corresponding obligation on the part of the drawer to ensure that the cheque drawn by him is honoured by the bank who stands in the capacity of an agent of the drawer vis-à-vis the holder of the cheque. If the holder of the cheque has a right, as indeed is in the unanimous opinion expressed in the decisions on the subject, there is no reason why the corresponding obligation of the drawer should also not continue every time the cheque is presented for encashment if it satisfies the requirements stipulated in that clause (a) to the proviso to Section 138. There is nothing in that proviso to even remotely suggest that clause (a) would have no application to a cheque presented for the second time if the same has already been dishonoured once. Indeed if the legislative intent was to restrict prosecution only to cases arising out of the first dishonour of a cheque nothing prevented it from stipulating so in clause (a) itself. In the absence of any such provision a dishonour whether based on a second or any successive presentation of a cheque for encashment would be a dishonour within the meaning of Section 138 and clause (a) to proviso thereof. We have, therefore, no manner of doubt that so long as the cheque remains unpaid it is the continuing obligation of the drawer to make good the same by either arranging the funds in the account on which the cheque is drawn or liquidating the liability otherwise. It is true that a dishonour of the cheque can be made a basis for prosecution of the offender but once, but that is far from saying that the holder of the cheque does not have the discretion to choose out of several such defaults, one default, on which to launch such a prosecution. The omission or the failure of the holder to institute prosecution does not, therefore, give any immunity to the drawer so long as the cheque is dishonoured within its validity period and the conditions precedent for prosecution in terms of the proviso to Section 138 are satisfied.[Para No.22]

Notice returned with endorsement 'house locked', 'shop closed', "addressee not available' is presumed to be dully served

It is clear from Section 27 of the General Clauses Act, 1897 and Section 114 of the Indian Evidence Act, 1972, that once notice is sent by registered post by correctly addressing to the drawer of the cheque, the service of notice is deemed to have been effected. The requirements under proviso (b) of Section 138 stands complied, if notice is sent in the prescribed manner. However, the drawer is at liberty to rebut this presumption.[Para No.13]

    It is well settled that interpretation of a Statute should be based on the object which the intended legislation sought to achieve.

“It is a recognized rule of interpretation of statutes that expressions used therein should ordinarily be understood in a sense in which they best harmonize with the object of the statute, and which effectuate the object of the Legislature. If an expression is susceptible of a narrow or technical meaning, as well as a popular meaning, the Court would be justifed in assuming that the Legislature used the expression in the sense which would carry out its object and reject that which renders the exercise of its power invalid"[Para No.14]

    This Court in catena of cases has held that when a notice is sent by registered post and is returned with postal endorsement “refused” or “not available in the house” or “house locked” or “shop closed” or “addressee not in station”, due service has to be presumed. Though in process of interpretation right of an honest lender cannot be defeated as has happened in this case. From the perusal of relevant sections it is clear that generally there is no bar under the N.I. Act to send a reminder notice to the drawer of the cheque and usually such notice cannot be construed as an admission of non-service of the first notice by the appellant as has happened in this case.[Para No.15]

Mere service of notice would not give rise to a cause of action

Cause of action' implies a right to sue. The material facts which are imperative for the suitor to allege and prove constitutes the cause of action. It has been interpreted to mean that every fact which would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the Court. [Para No.20]

   As cause of action is the bundle of facts to examine the issue of jurisdiction it is necessary that one of the interlinked fact must have occurred in a place where the case has been instituted. All necessary facts must form an integral part of the cause of action. The fact must have direct relevance in the lis involved. It is not that every fact pleaded can give rise to a cause of action so as to confer jurisdiction on the Court in whose territorial jurisdiction it has occurred.[Para No.21]

Tenant is not protected if he fails to pay rent after receipt of notice and during the trial as well as appeal proceeding

Maharashtra Rent Control Act - Eviction of tenant on the ground of default in payment of regular rent and illegal subletting - No rent is paid even after receipt of notice for eviction - Tenant disputed the standard rent but has not filed application for fixation of standard rent - Tenant made default in payment of regular rent in trial court and appellate court - Court commissioner report in respect of subletting filed but tenant has not filed his say thereon.

   The above enunciation, clarifies beyond doubt that the provisions of Clause (b) of Section 12(3) are mandatory, and must be strictly complied with by the tenant during the pendency of the suit or appeal if the landlord's claim for eviction on the ground of default in payment of rent is to be defeated. The word "regularly" in Clause (b) of Section 12(3) has a significance of its own. It enjoins a payment or tender characterized by reasonable punctuality, that is to say, one made at regular times or intervals. The regularity contemplated may not be a punctuality, of clock like precision and exactitude, but it must reasonably conform with substantial proximity to the sequence of times or intervals at which the rent falls due. Thus, where the rent is payable by the month, the tenant must, if he wants to avail of the benefit of the latter part of Clause (b), tender or pay it every month as it falls due, or at his discretion in advance. If he persistently default during the pendency of the suit or appeal in paying the rent, such as where he pays it at irregular intervals of 2 or 3 or 4 months as is the case before us the Court has no discretion to treat what were manifestly irregular payments, as substantial compliance with the mandate of this Clause irrespective of the fact that by the time the Judgment was pronounced all the arrears had been cleared by the tenant.

{Mranalini B. Shaha and another Vs. Baplal Mohanlal Shaha (1980) 4 SCC 251} [Para No.16]

No bar of res judicata to second suit for eviction of tenant

Landlord filed suit for eviction on the grounds of bona fide requirement, erection of unauthorized permanent structures, change of user, and unlawful subletting - Suit dismissed - Appeal  was also unsuccessful - After less than three months, the landlord issued a "notice for possession" to the tenant and again filed second suit for eviction on the grounds of bona fide requirement, arrears of rent, and permanent construction on the suit premises

Is the second suit stand barred by res judicata and Section  12 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 ("the Bombay Rent Act")?

True, subsequent events may affect the suit outcome. For that, either party to the suit should bring to the court's notice those later developments. For that even the amended Order 6, Rule 17 of CPC provides. Otherwise, the court itself, in the interest of justice and to avoid multiplicity of proceedings, may take note of those developments. But law does not compel a person to invariably bring on record all the later developments through amendment. If the later developments provide an independent cause of action, the party's right to a fresh legal remedy remains intact. This proposition applies with more rigour if the cause of action is recurring.[Para No.54]

   Default in rent remittance provides recurring cause of action. Every successive default provides an independent cause of action.

Later developments may affect that cause of action if they are duly brought on record; otherwise, they provide further independent cause of action. Even the doctrine of lis pendens does not defeat the suitor's independent right to sue. It is only a matter of prudence and convenience that all the related facts are brought under one umbrella of adjudication. More particularly, if the cause of action is recurring, each instance of recurrence provides an independent cause of action.