Final Order 1

Order Details: Copy of Judgment
Pdf Text: SJ 58-2018 in Sum Suit 1102 of 2016 .. J/1 .. Judgment
MHCC010102892016 Presented on : 29.09.2016
Registered on : 19.10.2016
Decided on : 04.03.2026
Duration : 04 Y : 05 M : 05 D
IN THE BOMBAY CITY CIVIL COURT AT MAZGAON
SUMMONS FOR JUDGMENT NO. 58 OF 2018
IN
SUMMARY SUIT NO.1102 OF 2016
Mrs. Mushfeka Mamnoon,
Indian Inhabitant of Bombay,
having address at Flat No.224-225, 22nd Floor,
Naperol Tower, Kidwai Nagar, Wadala (W),
Mumbai – 400 031.
...Plaintiff.
VERSUS
1. Paradyne Infoservices Pvt. Ltd.
A company registered under Indian Companies
Act, 1956, 53/2476, Radheshyam,
Gandhinagar, Bandra (E), Mumbai – 400 051.
2. Mr. Annand Sarnaaik,
Indian Inhabitant of Bombay,
Adult, Occ. : Not Known
AND
3. Ms. Divvyani Annand Sarnaaik,
Indian Inhabitant of Bombay,
Adult, Occ. : Not known,
Both having their address at :
402, Jairaj CHS Ltd., Opp. Income Tax Bldg.,
Bandra Kurla Complex, Bandra (E),
Mumbai – 400 051.
4. Messers Glodyne Technoserve Ltd.,
A company registered under Indian Companies
Act, 1956, having its registered address at :
801, Balrama Bldg Bandra Kurla Complex,
Bandra (E), Mumbai – 400 051.
Suit withdrawn
against defendant
Nos.1 and 4
…Defendants.
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Appearances:
Adv. Yojana Gandhi a/w. Adv.
Bhargavi Raval
: For plaintiff.
Adv. Lalit Pal a/w Adv. Nilofar
Khan.
: for Defendant
Nos.2 & 3.
CORAM : HIS HONOUR JUDGE
N. B. LAVTE, (C.R.No.83).
DATE : 4th March, 2026.
J U D G M E N T
The Summary Suit is filed for recovery of an amount of
Rs.2,00,000/- with 18% p.a based on Bill of Exchange and cheque. It is
filed by CA of plaintiff Mr. Dilipkumar Aatmaram Nagpal. In the said
suit the present SJ is filed. The brief facts of the suit is that :
The plaintiff is residing at the address mentioned in the plaint.
The defendant Nos.1 and 4 are companies registered under the
Companies Act, 1956. The defendant Nos.2 and 3 are having their
address mentioned in the plaint. She gave an amount of Rs.2,00,000/-
by account payee cheque No.144030 dated 03.10.2011 to defendant
No.1. On 26.02.2013 defendant No.1 executed demand Bill of Exchange
on defendant Nos.2 to 4 of Rs.2,00,000/-. It was accepted by defendant
Nos.2 to 4. The defendant No.1 paid interest from time to time and
renewed the Bill of Exchange till 29.08.2013. On 26.02.2013
defendants paid interest of 184 days i.e till 29.08.2013 by account
payees cheque.
2. It is their further case that the defendants deducted TDS
payable on interest by cheques. The Bill of Exchange when presented
for payment to defendant Nos.2 to 4 and thereafter to defendant No.1,
however, they were dishonoured. The defendants sought short time to
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repay the amount and gave cheque of Rs.2,00,000/- vide cheque
No.266168 dated 27.11.2013 towards repayment. When presented for
encashment, it returned unpaid with remark ‘insufficient funds’ on
20.12.2013. Legal notice was issued on 16.01.2014. As the amount was
not paid, suit came to be filed. In the said suit present SJ is filed with
prayer to make it absolute.
3. The writ of summons were issued. The plaintiff by moving
application Exh.03 and 04 prayed for permission to withdraw suit
against defendant Nos.1 and 4 which was allowed by order dated
23.12.2016 and 10.07.2017. Thereafter, plaintiff filed SJ to which
defendant Nos.2 to 3 (hereinafter referred to as ‘contesting defendants’)
filed their reply and challenged the same on the ground of
maintainability as plaintiff is not a registered money lender, therefore as
per the Bombay Money Lenders Act, 1947, the suit is not maintainable.
It is also claimed that in view of Winding Up Order passed against
defendant No.1 and official liquidator is not arrayed as party to the suit,
therefore, the suit is not maintainable. The leave u/Sec.446 and Sec.447
of the Companies Act is not obtained.
4. It is their specific defence that they did not issue any
cheques for paying interest. They did not accept the Bill of Exchange.
The Bill of Exchange were signed in blank at the insistence of plaintiff
and they never accepted it in their personal capacity. Therefore, the suit
against them is bad for mis-joinder of parties. Their signatures were
taken in blank areas and the signatures in the column of ‘acceptors
signature’ are not theirs, therefore, it be referred to hand writing
expert. The legal notice was duly replied. Hence prayed for an
unconditional leave to defend the suit.
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5. The plaintiff filed rejoinder and denied the contents of the
reply/leave to defendant.
6. Heard both the sides and gone through the written notes of
argument Exh.07 and Exh.06. So also gone through the original
documents filed alongwith list Exh.08. The original documents are Bill
of Exchange, Cheque, Return Memo and true copy of certificate issued
by Bank of Baroda about amount of Rs.2,00,000/- by cheque debited in
favour of defendant No.1. The plaintiff is claiming that she paid
Rs.2,00,000/- by cheque to defendants and in lieu of it, defendant No.1
drew the Bill of Exchange which was accepted by defendant Nos.2 to 4.
However, on demand the Bill of Exchange was dishonoured. The
Cheque issued by defendants of Rs.2,00,000/- on presentation got
dishonoured. Whereas, the contesting defendants took defence that
their signatures were obtained on blank Bill of Exchange and they did
not accept the Bill of Exchange.
7. During the course of argument, Adv. Gandhi for plaintiff
submitted that provisions of the Bombay Money Lenders Act, 1947 are
not applicable to Bill of Exchange. She further submitted that in view of
defendant No.4 company being Wound Up by filing an application they
withdrew suit against defendant No.4 which was allowed. As regards
defendant Nos.2 to 4, she submitted that later on suit against defendant
No.4 was withdrawn. The contesting defendants being acceptors of Bill
of Exchange, the suit can proceed against them and liability can be
fastened upon them as borrowers. She further submitted that the
subsequent cheque issued by defendant No.2 proves liability. Therefore,
according to her, contesting defendants cannot escape the liability as
acceptors of Bill of Exchange.
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8. Adv. Gandhi further submitted that contesting defendants
are not outrightly denying their signatures nor claiming it to be forged
one, but denying the liability as acceptors. Being acceptors of Bill of
Exchange they are liable to pay the amount. The defence raised being
moonshine, therefore, no any triable issues are raised. Therefore, they
are not entitled for conditional or an unconditional leave to defend the
suit. Hence, prayed for making the SJ absolute and decreeing the suit.
9. Whereas, Adv. Pal for contesting defendants submitted that
once defendant No.4 company is Wound Up and the official liquidator is
not joined as party, therefore, the suit must fail. The Bill of Exchange
was not signed by defendant Nos.2 to 4 but their signatures were
obtained on blank paper which were later on misused as Bill of
Exchange. As they are not acceptors, they are wrongly joined as
defendants. The suit is not maintainable as plaintiff is not a registered
money lender holding valid license. Hence, according to him as
substantial defence is raised which qualifies the test of triable issues,
therefore, contesting defendants are entitled for unconditional leave to
defend the suit.
10. From the oral submissions and written notes of arguments,
the contesting defendants have challenged the suit on multiple grounds.
As regards the maintainability of the suit on the ground of defendant
No.4 being Wound Up. It is not in dispute that the Hon’ble High Court
by its order dated 28.10.2014 allowed the petition. The plaintiff by
moving application Exh.03 and Exh.04 withdrew the suit against
defendant Nos.1 and 4 which were allowed. Thus, the plaintiff is
pursuing her suit against contesting defendants only in the capacity as
directors. The plaintiff claimed being acceptors of Bill of Exchange,
contesting defendants are liable for the amount. In the written notes of
arguments reliance is placed on three authorities.
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11. In
Ashok Mohansingh Bajaj (HUF) vs. Elegant
Pharmaceuticals & Ors., 2002 (2) ALL MR, 242 similar question arose
before the Hon’ble High Court wherein the defendant No.1 company
was declared as sick and proceeding under the BIFR and SICA were
going on. While deciding the issue, the Hon’ble High Court by placing
reliance on Sec.37 of the NI Act held that defendant No.1 was drawer
and defendant No.2 being an acceptor of bill of exchange, is
independently liable as principal debtor u/Sec.37 of the NI Act.
12. Similar view is taken in
IDBI Trusteeship Services Limited
vs. Hub Town Limited (2017) SCC 568, wherein, the Hon’ble Apex
Court had held that there is no impediment in proceeding with the
matter and getting a decree when a defendant is adjudged insolvent
during the pendency of a commercial suit. Similar view is taken in
Union Bank of India vs. Ankur Corporation & Ors., decided on
09.11.1992 wherein the Hon’ble High Court held that suit is
maintainable against acceptor of Bill of Exchange. No any counter
authorities are filed by the defendants to show that suit against the
acceptor of Bill of Exchange is not maintainable, if the drawer company
is Wound Up. If the ratio of authorities cited and relied upon by plaintiff
are taken into consideration, then defence of contesting defendants that
they are not liable as acceptors of Bill of Exchange is devoid of merit.
13. As regards the second defence of lack of money lending
licence, first of all, the provisions of Bombay Money Lenders Act, 1947
are not applicable to Bill of Exchange and the same is excluded from the
definition of loan. To attract the provisions it should be proved that
plaintiff is doint business of money lending which is missing. Therefore,
the said defence is devoid of any merit. At the cost of repetition, the
contesting defendants being directors and defendant No.2 on behalf of
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defendant No.4 have not outrightly denied their signatures on the Bill
of Exchange nor on the cheque. No any defence of forgery of signatures
is claimed by them. Therefore, being acceptors of Bill of Exchange and
issuing the cheques, contesting defendants cannot escape the liability of
the amount and are liable as debtor.
14. On the point of whether contesting defendants have raised
triable issues indicating they have fair and reasonable defence to grant
them conditional or unconditional leave to defend the suit, useful
reference to para.17 of judgment in
IDBI TRUSTEESHIP SERVICES
LIMITED VS HUBTOWN LTD (2017) 1 SCC 568, can be made wherein
the Hon’ble Apex Court observed 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 indicating 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 defendant 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 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
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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.
15. If the proposition of law laid down in
IDBI (supra) more
particularly observation in 17.5 which is again reproduced, “
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” and the facts of the present case in hand
are taken into consideration and my detail observation about that
contesting defendants are not denying their signatures on the Bill of
Exchange and no whisper about the cheque which was dishonoured,
hence, no any substantial defence is raised by them to grant them
conditional or an unconditional leave to defend the suit. The suit
against defendant Nos.1 and 4 is withdrawn. The contesting defendants
are acceptors of Bill of Exchange. The cheque is issued by defendant
No.2 which on presentation returned back for lack of funds. If that
being so, then, the plaintiff is entitled for judgment and the SJ is liable
to made absolute against contesting defendants only.
16. In view of the SJ being made absolute, the suit deserves to
be decreed. As regards the rate of interest, in the Bill of Exchange no
any rate of interest is mentioned and the said column is blank. However,
plaintiff is claiming 18% p.a. There is no any pleading that the
transaction was commercial in nature. Therefore, I am of the view that
interest of 9% p.a would be reasonable rate of interest instead of 18%
p.a. Hence, I proceed to pass following order.
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O R D E R
1. The Summons for Judgment No.58 of 2018 in Summary Suit
No.1102 of 2016 is made absolute against defendant Nos.2
and 3 only.
2. The Summary Suit No.1102 of 2016 stands decreed with costs
against defendant Nos.2 and 3 only.
3. The defendant Nos.2 and 3 are jointly and severally directed to
pay to plaintiff an amount of Rs.2,00,000/- (Rupees Two Lacs
Only) with 9% p.a from the date of filing of the suit till
realization.
4. The decree be drawn up accordingly.
5. The Record and Proceeding be sent to Record Department.
( N. B. Lavte )
Judge, (C.R.No.83)
Dt.:04.03.2026 City Civil Court, Mazgaon,
MUMBAI
Dictated on : 04.03.2026
Transcribed on : 06.03.2026
checked on : 07.03.2026
Signed on : 07.03.2026
( N. B. Lavte )
Judge, (C.R.No.83)
City Civil Court, Mazgaon,
MUMBAI.
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
07.03.2026 at 5.45p.m.
UPLOAD DATE AND TIME (MANISHA SRINATH)
NAME OF STENOGRAPHER
Name of the Judge H.H.J.Shri. N. B. Lavte
(COURT ROOM NO.83)
Date of pronouncement of
judgment/order
04.03.2026
Judgment/order signed by P.O. on 07.03.2026
Judgment/order uploaded 07.03.2026
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