Final Order 1

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MHCC010022642019
IN THE COURT OF JUDGE CITY CIVIL AT GREATER MUMBAI
SUMMONS FOR JUDGMENT NO. 68 OF 2019
IN
SUMMARY SUIT NO. 669 OF 2019
Uday Dattatraya Telang, Age 63 years
of thereabout Indian inhabitant of
Mumbai, residing and carrying on
business at 107, Madhani Estate,
Senapati Bapat Marg, Dadar(W),
Mumbai-400 028.
...Plaintiff
VERSUS
1. Ashwin Dhaneshwar Acharya
2. Smt. Aarati Ashwin Acharya Both
adults Indian inhabitants residing at
451/452, Shree Niwas, Dandekar
Estate, Gandevi Road, Bilimora-396
380 Gujarat.
3. Dr. Anil Dhaneshwar Acharya
Adult, Indian inhabitant, Residing at
305, Classic Residency, Tower No.2,
Opp. Akota Garden, Vadodara -390
020.
...Defendants
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Sum SU No.669-19
Appearance :
Ld. Adv. Mr. Iqbal A. Siddhiqui for plaintiff.
Ld. Adv. Mr. Prashant H. Chande for defendants.
CORAM : DR. S. D. TAWSHIKAR
(Court Room No.61)
DATE : 19-10-2022.
ORAL ORDER
(Dictated and pronounced in Open Court)
Plaintiff has taken out present Summons for Judgment as
per Sub rule (4) of Rule 3 of Order XXXVII of Code of Civil Procedure,
1908 (hereinafter referred as ‘CPC’ for short) and thereby claims
Judgment against defendants for recovery of Rs.5 lakhs along with
interest at the discretion of this Court.
Plaintiff’s case in brief:-
2. Plaintiff claims to be a business man, resident of Mumbai. It
is contended that plaintiff and defendants are having friendly relation
and known to each other for many years. Defendants approached
plaintiff and requested him to lend and advance some friendly short
term loan to them to meet their business exigencies. Defendants assured
repayment in short time. Accordingly plaintiff advanced sum of Rs.5
lakhs by way of RTGS on the account of defendant No.1, on 04-02-
2011. Defendant No.1 issued a post dated cheque of Rs.5 lakhs bearing
date 04-04-2011. The said cheque was issued in the name of proprietary
firm of plaintiff namely Metals Development Company.
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Sum SU No.669-19
3. Plaintiff further contends that defendants requested him
not to deposit the aforesaid post dated cheque and they will arrange
fund from other account. However same was not paid. It is contended
that thereafter once plaintiff was in urgent need of some amount,
therefore he again sought return of his amount from defendants. At that
time defendant No.1, for time being, issued a cheque of Rs.10,000/-
dated 01-07-2011. When plaintiff tried to encash the cheque, it was
dishonoured. It is contended that Defendant No.3 at that time assured
the plaintiff that he would take responsibility to pay the entire amount
at earliest.
4. Plaintiff contends that as defendants failed and neglected
to pay the amount, he sent recovery notice through his advocate dated
15-07-2013. The said notice was replied by defendant No.3 ony by
contending that he has no concern with the alleged transaction of hand
loan. Plaintiff further contends that in spite of notice defendants failed
to pay amount. Therefore, he has filed the present suit.
5. Plaintiff further contends that defendants have not denied
the receipt of amount of Rs. 5 lakhs from the plaintiff by way of RTGS.
The defence, tried to be canvassed, is frivolous and vexatious. It is
contended that no triable issue is raised by the defendants and hence
Summons for Judgment be made absolute.
Defendant’s case:-
6. All the defendants have contested Summons for Judgment
by filing their reply separately. Their defence is more or less similar with
small variance with respect to their role in the alleged transaction. In
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Sum SU No.669-19
sum and substance defendants denied the theory of friendly loan put
forth by the plaintiff. They denied liability to repay the amount.
7. Defendant no.1 has come with a theory that plaintiff was
due for retirement and he wanted to carry out some business after his
retirement and therefore he contacted defendant No.1 for starting some
business jointly at Gujarat. With that view he invested an amount of
Rs.5 lakhs as a capital. It is further contended that meanwhile plaintiff
was in need of some money and therefore defendant No.1 from time to
time paid an amount of Rs.1,57,000/- to the plaintiff. The said amount
is sought to be adjusted against Rs.5 lakhs paid by the plaintiff. In
contrast to this contention, defendant No.1, in his further reply, has
choose to deny receipt of Rs.5 lakhs by RTGS.
8. Defendant No.2 has denied the knowledge with respect to
the payment of any amount by the plaintiff. She has denied all the
allegations of the plaintiff in toto.
9. Defendant No.3 has also disputed all the contentions of the
plaintiff. He relies on reply dated 23-07-2013 and contends that he has
no nexus with the alleged transaction.
10. Defendants further contend that there are many triable
issues involved in the matter which requires adjudication and therefore
unconditional leave to defend be granted.
11. Heard both the sides. Perused documents placed on record
by either sides. Following points arise for my determination. I have
recorded findings thereon along with reasons, as under :-
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Sum SU No.669-19
Sr. No. Points Findings
1. Whether defendants are entitled for
leave to defend ?
If yes, conditional or unconditional?
Unconditional leave to
defend is granted to
defendant Nos.2 &3.
Conditional leave to
defend is granted to
defendant No.1 subject
to his depositing Rs.5
lakhs before this Court
within 8 weeks from the
date of this order.
2. What order ? As per final order.
REASONS
As to Point No.1:-
12. So as to decide the Summons for Judgment, it is imperative
to examine whether defendants have made out substantial defence or
whether any triable issue is raised to grant leave to defend. It is settled
position of law that if the defendants succeed to get leave to defend
then summons for Judgment would stand rejected; if the defendants fail
to get leave to defend, plaintiff would be entitle for judgment forthwith.
13. Heard Ld. Advocate Mr. Siddhiqui for the plaintiff. He
submits that the fact of advancement of friendly loan of Rs.5 lakhs
cannot be disputed. The details of the RTGS in that regard are already
placed on record. He submits that the fact of issuance of cheque of Rs.5
lakhs by the defendant No.1 for himself as well as for defendant No.2,
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– 6 – SJ No.68-19 in
Sum SU No.669-19
shows acknowledgment of liability on their part. He further submits
that the issuance of cheque of Rs.10,000/-, further boost the contention
of liability of defendants. Mr. Siddhiqui submits that the defence tried to
be canvassed by the defendants is completed frivolous. Defendant No.1
though admits the fact of reception of amount, however has come with
a vague and imaginary theory of payment of the said amount towards
some business. He further submits that there is no documents placed on
record to boost this theory. He further submits that as the suit is filed for
recovery of debt, summary suit is maintainable in view of Sub Rule 2 of
Rule 1 of Order XXXVII of CPC. He, relying on documents filed by the
plaintiff along with reply to the Notice of Motion No.4363/2015,
submits that defendant No.2 as well as defendant No.3 have posed
themselves as partners of Shree Vinayak Steels and have communicated
with plaintiff in said capacity. He submits that now the defendant Nos. 2
and 3 cannot take ‘U’ turn and deny their liability.
14.
Per contra Ld advocate Mr. Chande for all defendants
strongly objected the maintainability of summary suit. He submits that
admittedly there is no written contract between the parties and
therefore suit for recovery of a debt simplisitor is not maintainable. He
also submits that though the plaintiff claims issuance of post dated
cheque of Rs.5 lakhs in his favour, however said cheque was never
dishonoured and therefore suit is not maintainable on the basis of non
dishonoured cheque/promissory note. He relies on the Judgment of the
Hon’ble Bombay High Court in the case of Jyotsna Valia Vs. T.S.Parekh
And Co., 2007(4)Mh.L.J.517.
15. Mr. Chande further submits that plaintiff failed to show,
even
prima facie, that the defendant Nos.2 and 3 are the
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Sum SU No.669-19
proprietors/partners of Shree Vinayak Seels Co. He submits that all the
defendants have negated the contentions of plaintiff by way of affidavit
in reply. The allegations of payment of Rs.5 lakhs towards friendly loan
is denied, however the said contentions are no refuted by plaintiff by
filing any rejoinder. He relied on the authority of Saraswatiben
Lallubhai Parikh and another, Vs. Kantilal Purshottamdas, AIR 1964
Gujarat 81(V 51 C 11) and submits that due to non filing of affidavit in
rejoinder disputing contentions in affidavit reply, triable issues are made
out and therefore unconditional leave to defend may be granted.
16. Adv. Siddiqui relied on the authority of Hon’ble Delhi High
Court in the case of Mange Ram Vs. Rajkumar Yadav, RFA No.
623/2018, dated 03-08-2018) and submits that defendant has no
substantial defence or any genuine triable issue and therefore no leave
to defend be granted.
17. It is settled position of law that while considering Summons
for Judgment, Court is not excepted delve deep on the merit of the case.
The Court is expected to ascertain whether substantial or genuine
triable issue is raised by the defendant or not. Said inquiry must be
limited to decide whether leave to defendant can be granted or not.
18. The Hon’ble Apex Court in the IDBI Trusteeship Services
Limited Vs. Hubtown Limited, (2017) 1 SCC 568, has dealt with various
situation wherein leave to defend can be granted or refused. In view of
the law laid down by the Hon’ble Apex court, I do not find it necessary
to discuss the judgments of various High Courts, relied upon by the
defendant on said point. The Hon’ble Apex Court in Para No.17 has laid
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Sum SU No.669-19
down certain Guidelines to be considered while granting/refusing to
leave to defend. Those are as under.
“17. Accordingly, the principles stated in para 8 of Mechelec
case will now stand superseded, given the amendment of
Order 37 Rule 3 and the binding decision of four judges in
Milkhiram case, as follows:
17.1. If the defendant satisfies the court that he has a
substantial defence, that is, a defence that is likely to succeed,
the plaintiff is not entitled to leave to sign judgment, and the
defendant is entitled to unconditional leave to defend the
suit.
17.2 If the defendant raises triable issues indicting that he
has a fair or reasonable defence, although not a positively
good defence, the plaintiff is not entitled to sign judgment,
and the defendant is ordinarily entitled to unconditional
leave to defend.
17.3 Even if the defend raises triable issues, if a doubt is left
with the trial Judge about the defendant’s good faith, or the
genuineness of the triable issues, the trial Judge may impose
conditions both as to time or mode of trial, as well as
payment into court or furnishing security. Care must be taken
to see that the object of the provisions to assist expeditious
disposal of commercial causes is not defeated. Care must also
be taken to see that such triable issues are not shut out by
unduly severe orders as to deposit or security.
17.4 If the defendant raises a defence which is plausible but
improbable, the trial Judge may impose conditions as to time
or mode of trial, as well as payment into court, or furnishing
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Sum SU No.669-19
security. As such a defence does not raise triable issues,
conditions as to deposit or security or both can extend to the
entire principal sum together with such interest as the court
feels the justice of the case requires.
17.5 If the defendant has no substantial defence and/or
raises no genuine triable issues, and the court finds such
defence to be frivolous or vexatious, then leave to defend the
suit shall be refused and the plaintiff is entitled to judgment
forthwith.
17.6 If any part of the amount claimed by the plaintiff is
admitted by the defendant to be due from him, leave to
defend the suit, (even if triable issues or a substantial defence
is raised), shall not be granted unless the amount so admitted
to be due is deposited by the defendant in court.”
Now, in the light of the guidelines issued by the Hon’ble Supreme Court,
the grounds raised by the defendant needs to be assessed.
19. It is pertinent to note that in matter in hand the plaintiff
has placed on record sufficient material to show that an amount of Rs.5
lakhs was paid by him on the account of defendant No.1 by way of
RTGS on 04-02-2011. Defendant No.1 contends that the said amount
was received by him as an investment/capital for a new business to be
carried on between the plaintiff and defendant, however, defendant
No.1 failed to mention as to what business was to be started, where to
be started and what steps are taken to actually start the same. As such
the defence tried to be canvassed with respect to payment of amount of
Rs.5 lakhs towards investment/capital is clearly vague and unacceptable
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Sum SU No.669-19
at this stage. Admittedly defendant No.1 has received the amount of
Rs.5 lakhs from the defendant by way of RTGS.
20. Defendant No.1 though claims repayment of Rs.1.57 lakhs
(para 6 of his reply) from time to time, however, no details of the mode
and manner of payment is placed on record. Therefore, this contention
prima facie lacks support and hence cannot be accepted.
21 It needs to be noted that defendant No.1 had issued a
cheque of Rs.5 lakhs in favour of Metal Development Company i.e.
propitiatory concern of the plaintiff. So also, thereafter a cheque of
Rs.10,000/- was issued by the defendant No.1 in favour of Metal
Development Company. Admittedly, the cheque dated 04-04-2011 was
never tried to be encashed by plaintiff and as such was never
dishonoured. The contention of Ld advocate Mr. Chande for defendants
that summary suit cannot be filed based on non dishonoured cheque,
seems to be acceptable in view of Judgment of Hon’ble High Court in
the case of Jytosna Walia (supra). However the present suit is not
based on the said non-dishonoured cheque but on the cause of action of
RTGS payment and alleged failure of defendants to repay the same.
Admittedly there is no written contract between the parties. The suit is
not based on dishnoured cheque as well. Therefore in view of Sub Rule
(2) of Rule 1 of CPC, issue as to maintainability of summary suit seems
to be a bonafide triable issue.
22. From the record it is clear that the plaintiff failed to place
on record sufficient material to show the involvement of defendant
Nos.2 and 3 in the alleged hand loan transaction. So also there is no
sufficient material to show that defendant Nos.2 and 3 have admitted or
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Sum SU No.669-19
acknowledged their liability against the payment made by the plaintiff
to the defendant No. 1. Thus the defendants No.2 and 3 raises
substantial defence with respect to their liability. Therefore, in my view,
defendant No’s 2 and 3 deserves unconditional leave to defend.
23 At the cost of repetition it needs to be observed that fact of
receipt of an amount of Rs.5 lakhs by defendant no. 1 from the plaintiff
is prima facie established. This is rather admitted fact on the part of
defendant No. 1. Therefore in view of guidelines (para No. 17.6) of
Hon’ble Apex court in case of IDBI Trusteeship (supra), leave to defend
can be granted to the defendant No. 1 subject to his depositing amount
of Rs. 5 Lakhs as a security.
As to Point No. 2:-
24. It is obvious that due to grant of conditional leave to
defend, plaintiff is not entitled for Judgment at this stage. Hence
Summons for Judgment is bound to be rejected.
25. It is made clear that observations with respect to the merit
of the case made in this order are
prima facie and without prejudice to
the rights of the parties in trial. Hence, the order.
ORDER
A. Unconditional leave to defend is granted to defendant
Nos. 2 and 3.
B. Conditional leave to defend is granted to defendant No.1 subject
to his depositing Rs.5 lakhs before this Court within 8 weeks
from the date of this order.
C. On depositing amount by the defendant No.1, same be invested
in Fixed deposit as per rules, until further orders.
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Sum SU No.669-19
D. Defendant Nos.2 and 3 to file Written Statement within 8
weeks from the date of this order.
E. Defendant No.1 may file Written Statement within 2 weeks after
depositing the amount as aforesaid.
F. Summons for Judgment No.68/2019 is disposed of accordingly.
Date: 19-10-2022. (Dr. S. D. Tawshikar)
Judge, City Civil Court, Gr. Mumbai.
Court Room No.61
Dictated on : 19-10-2022
Transcribed on : 20-10-2022
Signed on : 21-10-2022
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
21-10-2022 at 5.45p.m. Mrs. Vidya V. Malgaonkar
Name of the Judge
(with Court Room No.)
Dr. S.D. Tawshikar
C.R. No.61
Date of Pronouncement of JUDGMENT/
ORDER
19-10-2022
JUDGMENT/ORDER signed by P. O. on 21-10-2022
JUDGMENT/ORDER uploaded on 21-10-2022
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