Order 1

Order Details: Copy of Judgment
Pdf Text: SJ 62/2018 SUM.SUIT 1401/2017 1
MHCC010025542018
IN THE CITY CIVIL COURT AT MUMBAI
SUMMONS FOR JUDGMENT No.62 of 2018
IN
SUMMARY SUIT No. 1401 of 2017
(UNDER ORDER XXXVII THE CODE OF CIVIL PROCEDURE 1908)
(CNR.NO.MHCC01-002554-2018)
Ashok Mohansingh Bajaj,
Age 61 years, the Karta and Manager
of Ashok Bajaj H.U.F., carrying on
business in the name and style of
M/s. Adarsh Associates, a
Proprietory Concern as its Sole
Proprietor at 207, Niranjan, 99,
Marine Drive, Mumbai-400 002. ...Plaintiff
Versus
1. Shailesh P. Sharma,
Age: Adult, carrying on business
at New Excelsior Building, 6th floor,
Room No.5-A, Wallace Street,
Fort, Mumbai-400 001.
2. M/s. Speciality Polymers Pvt.Ltd.,
a Company registered under the
Companies Act, 1956 carrying on
business at New Excelsior Building,
6th floor, Room No.5-A, Wallace Street,
Fort, Mumbai-400 001. ...Defendants
-- 1 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 2
Appearances:-
Advocate Ms.Kavita Lalwani for the Plaintiff.
Advocate Shri.Ravindra Jadhav h/f.advocate Mr.Prasad Rane for the
Defendants.
CORAM : HIS HONOUR JUDGE
DEEPAK L. BHAGWAT
(C.R.NO.28)
DATE : 2ND MARCH 2020
J U D G M E N T
1. This is Summons for Judgment for recovery of Rs.2,95,625/-
(Rupees Two Lakhs Ninety Five Thousand Six Hundred and Twenty Five
Only) with Pendente Lite and future interest at the rate of 18% p.a. on
the principal amount of Rs.2,75,000/-.
2. According to the plaintiff, he is sole proprietor, and carrying on
business in the name and style, of M/s. Pride Investments. Defendant
No.1 is an individual. Defendant No.2 is a registered company. On
23/03/2015, for valuable consideration, defendant No.1 drawn a bill of
exchange dated 23/03/2015 for Rs.8,25,000/-, on defendant No.2 and
in favour of the plaintiff. The defendants made part payment of
Rs.5,50,000/- as 1. Rs.1,50,000/- on 12/02/2016 by NEFT, 2.Rs.
1,25,000/- on 20/02/2016 by NEFT, 3. Rs. 1,10,000/- on 01/06/2016
by NEFT, 4. Rs. 1,10,000/- on 20/08/2016 by cheque and 5.
Rs.55,000/- on 20/08/2016 by cheque. Thereafter, on 08/05/2017
when the plaintiff presented the said bill of exchange, for payment of
balance amount of Rs.2,75,000/-, both defendants No.1 & 2
-- 2 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 3
dishonoured the same by non payment. However, they promised to pay
the amount within a short time. Thereafter, the defendants, towards
repayment of the due and balanced amount of the bill of exchange,
issued cheque dtd. 07/06/2017 for Rs. 2,75,000/- in favour of the
plaintiff. However, when the plaintiff presented the cheque, the same
was dishonoured with remarks 'funds insufficient'. The plaintiff several
times called upon the defendants to pay the balance amount of
Rs.2,75,000/- of the bill of exchange along with interest @ 18% p.a..
Vide legal notice dated 18/08/2017 also the plaintiff called upon the
defendants to pay the amount with interest. However, the defendant
falsely replied the notice vide reply dated 19/08/2017. Calculating the
interest, at the institution of the suit the amount due and payable by the
defendants was Rs.2,95,625/-. Therefore, the plaintiff has claimed
recovery of the amount with interest as prayed.
3. The defendants filed reply contesting the Summons for Judgment.
According to the defendants, entire plaint is on the footing of
transaction of bill of exchange between the parties when no dues are
pending between the parties. They denied that any bill of exchange was
drawn by defendant No.1 on defendant No.2. According to the
defendants, they paid 1. Rs,1,00,000/- on 09/12/2015, 2. Rs.75,,000/-
on 12/12/2015, 3. Rs.1,00,000/- on 16/12/2015, in cash to the
plaintiff towards the bill of exchange. Thereafter, the defendants made
rest of the payment as 1. Rs.1,50,000/- on 12/02/2016 by NEFT, 2.Rs.
1,25,000/- on 20/02/2016 by NEFT, 3. Rs. 1,10,000/- on 01/06/2016
by NEFT, 4. Rs. 1,10,000/- on 20/08/2016 by cheque and 5.
Rs.55,000/- on 20/08/2016 by cheque. Thus, the defendants have paid
entire amount to the plaintiff. The plaintiff had assured that the blank
undated security cheques will be handed over to the defendants after
-- 3 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 4
final payment. However, the plaintiff did not hand over the same
cheques and misused the same. The defendants are thus not liable to
pay any amount. Therefore, they requested to grant unconditional leave
to defend.
4. Considering material on record and submissions made on behalf
of the parties points arise for determination alongwith my findings
thereon for the reasons recorded are as under:-
POINTS FINDINGS
1. Whether the plaintiff is entitled to
Summons for Judgment?
In the Negative
2. Whether the defendant is entitled to
Leave to defend?
If yes, whether conditional/
unconditional?
Defendant No.1 is entitled to
leave to defend on condition
that he shall deposit amount
of Rs.2,75,000/- in the court.
3. What order? As per final order
REASONS
AS TO POINTS NO.1 to 3 :-
5. Worth to note that the proceeding against defendant No.2 has
been stayed by virtue of order of NCLT. The noting dated 07/10/2019
shows that the suit has proceeding against defendant No.1.
6. The Ld.advocate on behalf of the plaintiff argued that in the reply
notice given by defendant No.2 only nothing has been mentioned
regarding the bill of exchange. Thus, the issuance of bill of exchange is
admitted. Although the defendants raised the plea that payment has
been made to the plaintiff, there is no proof regarding the payment. The
-- 4 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 5
defendant has no defence. Therefore, she requested to allow the
summons for judgment.
7. On the other hand, Ld. advocate on behalf of the defendant
argued that the bill of exchange was drawn in favour of Pride
Investment and not the plaintiff. There is nothing to show that the
plaintiff is a proprietor of Pride Investment. The defendants have made
payment to the plaintiff of the due amount. Thus, the defendant has
substantial defence. Therefore, he requested to reject the Summons for
Judgment and grant unconditional leave to defend. He relied on
1.S.P.Brothers Vs. Biren Ramesh Kadakia, 2008(o) AIJ-MH 136680, 2.
State Bank of Hyderabad Vs. Rabo Bank, 2015(o)AIJEL-SC 57154 .
8. I have carefully gone through the decisions in the given
cases. In the case of 'S.P. Brothers', the Hon'ble Bombay High Court
held that issuance of certificate of tax deducted at source would
not be a document which will fall in any of the clauses under Sub-
rule 2 of Rule-1 of order 37. In the same case, a written contract
between the parties was neither pleaded nor any document was
placed to that effect on the record. Therefore, it was directed in
the said case that the suit therein shall proceed as ordinary suit. In
the case in hand, the suit is based on Bill of exchange and thus, it
satisfies the requirements of Order 37 Rule 1(2) of Code of Civil
procedure. Therefore, the decision in the case of 'S.P. Brothers' is
not beneficial to the defendant in the case in hand.
9. In the case of 'State bank V/s Rabo bank', the Hon'ble
supreme court held as “If the defendant satisfies the Court that he
-- 5 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 6
has a good defence to the claim on its merits, the plaintiff is not
entitled to leave to sign the judgment and the defendant is entitled
to unconditional leave to defend. If the defendant raised a triable
issue indicating that he has a fair or bona fide or reasonable
defence although not a positively good defence the plaintiff is not
entitled to sign judgment and the defendant is entitled to
unconditional leave to defend. If the defendant discloses such facts
as may be deemed sufficient to entitle him to defend, that is to say,
although the affidavit does not positively and immediately made it
clear that he has a defence, yet, shows such a stage of facts as
leads to the inference that at the trial of the action be may be able
to establish a defence to the plaintiff's claim, the plaintiff is not
entitled to judgment and the defendant is entitled to leave to
defend but in such a case the court may in its discretion impose
conditions as to the time or mode of trial but not as to payment
into court or furnishing security. If the defendant has no defence or
the defence is illusory or sham or practically moonshine then
although ordinarily the plaintiff is entitled to leave to sign
judgment, the court may protect the plaintiff by only allowing the
defence to proceed if the amount claimed is paid into court or
otherwise secured and give leave to the defendant on such
condition, and thereby show mercy to the defendant by enabling
him to try to prove a defence.” These principles of law have to be
kept in view while deciding whether leave to defend has to be
granted to the defendant.
10. The defendant advocate argued that there is no material to
-- 6 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 7
prove that the plaintiff is proprietor of pride investment. However,
this court must note that the plaintiff has come with specific case
that he is the proprietor of the pride investment. The defendants in
their reply did not specifically denied proprietorship of the plaintiff
but merely pleaded that the plaintiff must prove same fact.
Further, the defendants did not clarify as to who according to them
is the proprietor of Pride Investment. It cannot be lost sight of that
admittedly the defendants had handed over cheque to the plaintiff.
If the plaintiff is not the director then to whom the defendants had
handed over the cheque, the defendants do not clarify anything
about it. That apart the plaintiff has produced on record copy of
license issued under the Maharashtra Shops and establishment act
and income tax return for year 2014-15, which show the plaintiff
to be proprietor of Pride Investments. Thus, there is no substance
in the contention of the defendant challenging proprietorship of
the plaintiff.
11. In the case in hand the plaintiff has come with specific
contention that defendant No.1 had drawn bill of exchange
dtd.23.03.2015 for Rs.8,25,000/-. The defendants also made part
payment. However, the balance of Rs.2,75,000/- still remained to
be paid by the defendant for which the defendant had issued
cheque dtd.07.06.2017 which came to be dishonored. The
defendants in their reply at one place denied that bill of exchange
was drawn. However, at other place taken a plea that they have
made the payments by NEFT and cheque of part of the amount
towards the bill of exchange. Thus, the contentions of the
-- 7 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 8
defendants are self contrary. The defendants also took a plea that
the balance amount of Rs.2,75,000/- has been already paid by
them as Rs.1,00,000/- on 09.12.2015, Rs.75000/- on 12.12.2015
and Rs.1,00,000/- on 16.12.2015, in cash to the plaintiff. Thus,
according to the defendants the balance amount of Rs.2,75,000/-
was already paid by them in cash to the plaintiff. However, this
court must take into consideration that the defendants issued bill
of exchange in favour of the plaintiff, for certain amount they had
issued cheque to the plaintiff, further part payment has been made
thrice by NEFT and once by cheque. Keeping in view the manner
of formality between the parties while making the payment, it is
not at all reliable and probable to say that the defendants paid the
amount in cash to the plaintiff. Also, admittedly there are five suits
pending between the same parties in this court. In all the suits, the
defendants have taken a similar plea that the amount as claimed
by the plaintiff was paid to the plaintiff already in cash. The rest of
the matters also involve claim of lakhs of rupees. It is not
believable and probable that the defendants would have paid such
a huge amount in cash to the plaintiff. In this background, this
court has no hesitation to say that the defence as put forth on
behalf of the defendant is moon shine. However, still this court is
of the view to grant an opportunity to enable to the defendant to
prove his defence. In this background it is just and proper to
impose condition on the defendant to deposit the amount of
Rs.2,75,000/-. Therefore, the plaintiff is not entitled to summons
for judgment whereas the defendant No.1 is entitled to leave to
defend on condition that he shall deposit amount of Rs.2,75,000/-
-- 8 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 9
in the court. Hence, point No.1 is answered in the negative,
whereas point No.2 is answered as that defendant No.1 is entitled
to leave to defend on condition that he shall deposit amount of
Rs.2,75,000/- in the court. In answer to point No.3 order as
follows is passed:
ORDER
1. The summons for judgment 62 of 2018 against defendant
No.1 is rejected.
2. Leave to defend is granted to defendant No.1 on condition
that he shall deposit amount of Rs.2,75,000/- (Rupees Two Lakhs
Seventy Five Thousand only) in the court on or before
27/04/2020.
3. Subject to deposit of the amount as above, defendant No.1
shall file his written statement on or before 27/04/2020.
(Deepak L. Bhagwat)
Ad-Hoc Judge,
Date: 02/03/2020 City Civil Court, Gr. Mumbai
Dictated on : 02/03/2020
Signed on : 04/03/2020
-- 9 of 10 --
SJ 62/2018 SUM.SUIT 1401/2017 10
CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER.”
12/03/2020 at 3.05p.m. Mrs.J.V.Pawar
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
Name of the Judge (With Court Room No.) HHJ Shri.D.L.Bhagwat
(C.R.NO.28)
Date of pronouncement of Judgment/Order 02/03/2020
Judgment/Order signed by P.O. on 04/03/2020
Judgment/Order uploaded on 12/03/2020
-- 10 of 10 --