The Delhi High Court condoned a 67-day delay in filing a chamber appeal by Punjab National Bank and set aside an order that had closed the bank's right to lead evidence in an execution proceeding, holding that a party which has filed an evidence affidavit cannot be deprived of its right to present its case merely due to non-appearance on a single date.
Background & Facts
The Dispute
The decree-holder, Mrs. Simmi Dhawan, filed execution petition EX.P. 107/2019 to enforce a decree dated 07.05.2019 passed in CS(OS) No.984/2014 (Simmi Dhawan v. Naveen Malhotra & Ors). The decree directed specific performance and possession of property bearing no. B-24, land area measuring 305 sq. yds. approx., along with front half portion of garage, situated in Kailash Colony at Village Zamrudpur, on Lajpat Nagar and Kalkaji Link Road, Delhi. The decree also imposed a permanent injunction restraining the judgment debtor, Mr. Naveen Malhotra, from creating any third-party interest in the suit property until sale deed execution and possession transfer.
Key Facts
- The suit property is mortgaged to Punjab National Bank (respondent No.6 in the execution petition)
- Multiple mortgagees/banks are involved in the execution proceeding
- Punjab National Bank had filed its evidence affidavit in the proceeding
- The Joint Registrar directed respondents No.6 to 10 to conclude their evidence by order dated 18.02.2026
- The direction warned that failure to comply would result in closure of their right to lead evidence
Procedural History
- 07.05.2019: Decree passed in CS(OS) No.984/2014 for specific performance and possession
- 18.02.2026: Joint Registrar directed respondents No.6 to 10 to conclude evidence, failing which evidence would stand closed
- 11.03.2026: Impugned order passed closing right of respondents No.6 to 10 to lead evidence due to non-appearance
- 29.10.2026: Judgment pronounced by Justice Vinod Kumar condoning 67-day delay and setting aside order dated 11.03.2026
- 04.11.2026: Date fixed for parties to appear before Joint Registrar for fresh opportunity to lead evidence
The Parties' Positions
Punjab National Bank (Appellant): The bank submitted that the decreed property is mortgaged to it and, with multiple mortgagees involved, it is essential to place critical documents on record. It argued that once an evidence affidavit has been filed, the right to lead evidence cannot be closed merely on the ground of non-appearance on one date.
Mrs. Simmi Dhawan (Decree-holder/Respondent): Contended that allowing the appeal after considerable lapse of time would be unjust to the decree-holder who has been pursuing execution of the decree.
Relief Sought
Punjab National Bank sought: (1) condonation of 67 days' delay in filing the chamber appeal; (2) setting aside of the order dated 11.03.2026 to the extent it closes the bank's right to lead evidence while permitting reliance on the evidence affidavit already filed; (3) a fresh opportunity to lead evidence before the Joint Registrar.
The Legal Issue
The central questions were: (1) Whether the 67-day delay in filing the chamber appeal under Chapter II Rule 5 of the Delhi High Court (Original Side) Rules, 2018 warrants condonation; (2) Whether a party that has filed an evidence affidavit can be deprived of its right to lead evidence solely on the ground of non-appearance on a single date when valuable property rights are at stake.
Arguments Presented
For the Appellant (Punjab National Bank)
Counsel for the bank submitted that the decreed property is mortgaged to the appellant and, given the involvement of multiple mortgagees, it is requisite for the bank to place material documents on record. The bank emphasized that it had already filed its evidence affidavit, and the right to lead evidence cannot be closed by an adjudicating court merely on the ground of non-appearance on one date. The bank acknowledged negligence in pursuing the case but argued that this should not extinguish its valuable right over the mortgaged property.
For the Respondent (Mrs. Simmi Dhawan)
Counsel for the decree-holder submitted that allowing the present appeal after such considerable lapse of time would be unjust to the decree-holder who has been awaiting execution of the decree. The decree-holder emphasized the prejudice caused by the delay and the bank's negligence in complying with the Joint Registrar's directions.
The Court's Analysis
The Court examined the record and found that the appellant has claimed a valuable right over the property in question. The Court noted that the appellant-Punjab National Bank had already filed its evidence affidavit, which demonstrated its intention to participate in the proceeding. While acknowledging that the bank had been "extremely negligent in pursuing this case," the Court held that "at the same time it would not be appropriate to stop it from presenting its case before the Joint Registrar."
The Court's reasoning balanced the bank's negligence against the principle that a party with a substantive claim over property should not be shut out from presenting its case when it has already taken the step of filing an evidence affidavit. The Court exercised its discretion under the Delhi High Court (Original Side) Rules, 2018 to condone the delay, imposing costs as a condition to compensate the decree-holder for the delay.
"It is true that the appellant-Punjab National Bank had been extremely negligent in pursuing this case but at the same time it would not be appropriate to stop it from presenting its case before the Joint Registrar."
The Court distinguished between procedural default and substantive rights, holding that the closure of the right to lead evidence was a disproportionate consequence for non-appearance on a single date when the party had already filed its evidence affidavit and asserted a mortgage interest in the property.
The Verdict
The Court allowed both applications. In Ex Appl (OS) 1512/2026, the 67-day delay in filing the chamber appeal was condoned subject to payment of costs of Rs.20,000 to the decree-holder. In O.A. 278/2026, the impugned order dated 11.03.2026 was set aside. The Joint Registrar was directed to grant one more opportunity to Punjab National Bank to lead its evidence. Parties were directed to appear before the Joint Registrar on 04.11.2026. The chamber appeal stands allowed with these directions.
What This Means For Similar Cases
Evidence Affidavit Preserves Right to Lead Evidence
The judgment establishes that filing an evidence affidavit creates a substantive expectation that the party will be heard. Courts should be reluctant to close the right to lead evidence solely on procedural default when a party has already placed its evidence on record through an affidavit. Practitioners should ensure evidence affidavits are filed promptly to create this protective layer.
Condonation of Delay Balanced Against Substantive Rights
- Delay in filing appeals can be condoned when a valuable property right is at stake and the party has demonstrated participation through evidence affidavit
- Costs imposition (Rs.20,000 in this case) serves as the primary remedy for delay rather than dismissal
- The "extremely negligent" conduct of the appellant did not bar relief where substantive rights were involved
Mortgagee Rights in Execution Proceedings
- Mortgagees with interest in decreed property have a legitimate claim to participate in execution proceedings
- Multiple mortgagee situations require each mortgagee to be given opportunity to place documents on record
- Non-appearance on a single date should not extinguish a mortgagee's right to protect its security interest
