BABBAR SEWING MACHINE CO. vs TRILOK NATH MAHAJAN

The Supreme Court held that the penalty under Order XI Rule 21 of the Civil Procedure Code, 1908, is severe and should only be applied in extreme cases of non-compliance. The Court emphasized that the test for imposing such a penalty is whether the default was wilful, and that a mere failure to comply does not suffice. The Court allowed the appellant's appeal, ruling that the trial court's order striking out the defence was improper as there was no clear evidence of contumacy or wilful disregard of the court's order.