Interim Order 1

Order Details: Other
Pdf Text: 1 SJ No.163/2018 in Summary Suit No.371/2018
IN THE BOMBAY CITY CIVIL COURT AT BOMBAY
SUMMONS FOR JUDGMENT No.163 of 2018
(CNR NO. MH CC010067602018)
In
SUMMARY SUIT NO. 371 OF 2018
Rajesh Sumermal Munot
Son of Sumermal Munot, aged 31 years,
Occupation : Business, Carrying on business under
the name and style of “MUNOT INDUSTRIES” at
25/A, Chandawadi, 138, C.P. Tank Road,
Mumbai400 004. ....Plaintiff
V/s.
1) Manojj S. Katyal also known as Manoj S. Katyal
Age : Adult, Occupation : Business Carrying
under the name and style of “M S Fabrication”
2) Mrs. Deepika Manoj Katyal
wife of Manoj S. Katyal, Adult
Occupation : Housewife
3) Karan Manoj Katyal
Son of Manoj S. Katyal, Adult,
Occupation : Unemployed
4) Kunal Manoj Katyal
Son of Manoj S.Katyal, Adult,
Occupation : Unemployed.
All the Defendants commonly residing at
Flat No.H701, Paradise Cooperative Housing Society
Limited, Sector7, Sanpada400 705,
Navi Mumbai, DistThane. ...Defendants
Appearance:
Mr. K.S.Tripathi, Advocate for Plaintiff.
Ms. Rakesh Pathak, Advocate for Defendant No.1
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CORAM : HER HONOUR JUDGE
JAYSHRI R. PULATE
Adhoc Judge
City Civil Court,
Gr. Bombay
(C.R.No.40)
DATE : 3rd September, 2019.
ORDER
1. Plaintiff has taken out this Summons for Judgment for
recovery of Rs.76,55,531.88 / with interest.
2. It is the contention of plaintiff that defendant No.1 on
01.04.2016 had admitted and confirmed his liability towards plaintiff by
accepting and putting his signature and stamp on the plaintiff's
confirmation account dated 01.04.2016. Plaintiff is carrying on business
under the name and style of “MUNOT INDUSTRIES” where as Defendnat
No.1 is carrying on business under the name and style of “M.S.
FABRICATION”. Pursuant to verbal orders which were to be ratified by
written purchase order received by plaintiff from defendant
No.1, plaintiff sold and delivered
M.S.Pipe/PipeFittings/Plate/Structures/Sheet/ERM/Channel/Angle etc.
to defendant No.1 worth Rs.1,08,07,603/. Against the said amount in
all the 24 Original Tax Invoices issued by plaintiff were duly received and
acknowledged by defendant No.1 through Mr. Hemant Gholap,
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agent/employee of defendant No.1. Despite receipt of statutory legal
demand notice dated 16.09.2016 and 23.09.2016, defendant No.1 did
not raise any dispute in respect of delivery of goods.
3. Defendant No.1 had issued cheques towards discharge of his
liability and same were dishonoured for the reason “STOP PAYMENT”. As
defendant No.1 has no bonafide defence to the claim of plaintiff,
therefore, it is prayed that Summons for Judgment be made absolute.
4. In reply to the Summons for Judgment defendant No.1
contended that this court has no Territorial Jurisdiction to try and
entertain the suit. Defendant Nos.2 to 4 have been impleaded in the
present suit with malafide intention. Since they are not necessary
parties, suit is liable to be dismissed for reason of MisJoinder of parties.
According to defendant No.1 after delivery of the said goods, defendant
verbally informed to the plaitniff that the said goods were of inferior
quality and also having less quantity in weight. It was agreed and
assured on behalf of plaintiff that he will replace those inferior quality of
goods. On assurance given by plaintiff, defendant No.1 with bonafide
intention had issued post dated cheques as security to the plaintiff and
the same have been misused by plaintiff. According to defendant No.1,
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there are discrepancy in the Delivery Challan as well as in the Invoices
issued by the plaintiff as regards quantity of the goods. Delivery Challan
No.485 dated 23.03.2016 is not duly signed and acknowledged by
defendant. It is further contended that the date mentioned on entire
alleged delivery Challan is identical and similar with entire alleged
invoices date which are annexed to the plaint. Therefore, it reveals that
plaintiff has not supplied the goods as per the order placed by defendant
No.1.
5. Defendant No.1 has admitted that he issued 12 cheques for
the sum of Rs.39,00,000/. However, it is denied that towards discharge
of his admitted and confirmed liability in part, those cheques were
issued. Thus, the chques were issued as security deposit. After issuance
of said cheuqes, the defendant No.1 came to know about inferior quality
of goods supplied by the plaintiff and quantity was not in accordance
with the order placed by defendant No.1. Therefore, he immediately
stop the payment of those cheques and verbally requested to plaintiff to
take back entire inferior quality of goods and supply him fresh goods.
As entire transaction was made on oral request between the parties,
defendant No.1 did not raise any objection in writing. It is denied by
defendant No.1 that he is in active collusion and connivance with
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defendant No.2 to 4 to defeat the lawful claim of plaintiff. For all these
reasons, it is prayed by defendant No.1 that unconditional leave to
defend may kindly granted to him.
6. In Affidavit of ReJoinder in reply, it is contended by plaintiff
that, defendant No.1 is absconding accused in number of cases and is
trying to defeat the claim of not only the plaintiff but also number of
other creditors. Defences raised on behalf of defendant No.1 are also
denied. The defendant No.1 has not shown any record in respect of his
Bank Account that there was sufficient balance to meet the cheuque
amount which were issued by him.
7. I have heard both the learned Advocates at length. Learned
Advocate for plaintiff submitted that confirmation of accounts for the
period from 01.04.2015 to 19.12.2015 is duly signed by defendant No.1.
The receipt of weighing dated 10.03.2016 is also signed by the defendant
No.1. When the 12 cheques issued by the defendant No.1 were
dishonoured, the notice was issued to him. However, he has not made
any complaint in writing as regards inferior quality of goods and the
quantity of goods. The complaint under section 138 of Negotiable
Instrument Act has been filed against defendant No.1 but he has not
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appeared in the said proceeding. Therefore, learned Advocate for the
plaintiff submitted that there is no triable issue raised by defendant No.1
so as to entitle him for unconditional leave to defend the suit.
On the other hand learned Advocate for defendant No.1
vehemently submitted that defendant No.2 to 4 have joined in the suit
with malafide intention. The goods supplied by the plaintiff were of
inferior quality and therefore stop payment instruction was given by
defendant No.1 to the concern Bank. There is over writing in Challan
No.484. Further more, it does not bear vehicle number and address of
the defendant No.1. It is further submitted that this Court has no
jurisdiction to try the present suit, in view of Section 20 of Code of Civil
Procedure (CPC). The account confirmation statement relied by plaintiff
is forged document and therefore, it is prayed by learned Advocate for
defendant No.1 that unconditional leave to defend may kindly be
granted.
8. It is contention of defendant No.1 that the goods supplied
by plaintiff were of inferior quality and less quantity. According to
defendant No.1 as the transaction between plaintiff and defendant No.1
was based on oral requests, he has not made any written intimation
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disclosing his grievance about inferior quality goods and less quantity. In
this respect, record shows that demand notice was issued by plaintiff to
defendant No.1 calling upon him to pay the amount covered in the
invoices. However, defendant No.1 has neither replied the notice nor
raised any objection as to inferior quality of goods, to the plaintiff.
Therefore, the contention of defendant No.1 that as the transaction
between him and plaintiff was based on oral request, he did not raise any
objection as to inferior quality of goods, appears unjustifiable.
9. Another contention of defendant No.1 is that though he
issued 12 cheques in favour of plaintiff for Rs.39,00,000/ in total, those
were issued as security. The said cheques were dishonoured for the
reasons “Stop Payment” because after issuance of the said cheuqe,
immediately defendant No.1 came to know that goods supplied by
plaintiff were of inferior quality. In this respect, as rightly submitted by
learned Advocate for plaintiff that the defendant No.1 has not shown any
record in order to prove that there was sufficient balance in the account
of defendant No.1 to honour the said cheques. Further more, the
defendant No.1 had not given any written intimation to the plaintiff as
regards inferior quality of goods supplied by plaintiff. Therefore, at this
stage this defence of defendant No.1 appears to be illusory.
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10. The confirmation of accounts for the period from 01.04.2015
onwards reflects that it has been supplied to defendant No.1. According
to defendant No.1 it is forged document. However, in order to
substantiate this contention nothing has been brought on record by
defendant No.1 to show prima facie that the said document is forged
one. Therefore, this defence of defendant No.1 does not appear to be
reasonable.
11. It is further contented on behalf of defendant No.1 that there
is over writing in Challan No.484 and Delivery Challan date 21.03.2016
and weigh bridge receipt No.68352 reflects that there is discrepancy in
the quantity and net weight of the goods. In order to consider the said
contention of defendant No.1, evidence of both parties will require and
therefore, at this stage finding on that aspect can not be given.
12. Learned Advocate for plaintiff relied upon the matter of
Rajesh Laxmichand Udeshi @ Bhatia V/s. Pravin Hiralal Shah
reported in 2014 (1) ALL MR 784, wherein it has been observed that:
When a summary suit instituted is based on a cheque
which is dishonoured, effect of Sections 138 and 139 of
Negotiable Instruments Act raising statutory presumption
that the cheque was issued in discharge of a liability, is a
relevant consideration to be kept in mind. The said
Sections cast a burden upon the defendant to rebut the
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presumption. Summary Suits instituted on cheques which
are dishonoured will, therefore, stand on a higher footing
than summary suits instituted on the basis of other
documents.
In that case the parties had entered into Memorandum of
Understanding (MOU) under which defendant was to sell the flat with
consideration of Rs.8.46 Crores. The defendant issued three cheques but
raised defence that they were issued for the security only in some other
transaction. As defendant could not show other transaction for which
the cheques were issued, Summons for Judgment was made absolute. In
the present case, there is no such stand taken by defendant No.1.
Therefore, in order to decide the suit on merit, defendant is entitled for
conditional leave to defend as defence raised by him are leaving certain
doubts.
13 Learned Advocate for plaintiff relied on the observations in
the mater of Neebha Kapoor V/s. Jayantilal Khandwala & Others
reported in (2008) 3 SCC 770, wherein the case of Mechelec Engineers
& Manufacturers V/s. Basic Equipment Corpn. is discussed and it is
observed that :
A) If the defendants satisfies the court that he has a good
defence to the claim on its merits the plaintiff is not
entitled to leave to sign judgment and the defendant is
entitled to unconditional leave to defend.
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B) If the defendant raises a triable issue indicating that
he has 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.
C) If the defendant discloses such facts as may be deemed
sufficient to entitled him to defend, that is to say,
although the affidavit does not positively and
immediately make it clear that he has a defence, yet,
shews such a state of facts as leads to the inference that
at the trial of the action he 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.
D) If the defendant has no defence or the defence set up is
illusory or sham or practically moonshine then although
ordinarily the plaintiff is entitled to leave to sign
judgment and the defendant is not entitled to leave to
defend.
E) 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.
In that case unconditional leave to defend the suit was
granted by the Hon'ble High Court having regard to the admitted
position that the appellant was not in a position to produce the original
documents. Further more the directions were given to consider question
as to whether the respondents should be put to any terms or not for leave
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to defend should be determined afresh by the Hon'ble High Court.
Therefore, with due respect to the observations laid down in the cited
case since, the facts of the case law being not identical with the facts in
the case in hand, it is not applicable.
14. Learned Advocate for plaintiff further relied upon the matter
of Nagesh Sales Corporation and another, V/s. M/s. Kerala Soaps and
Oils Limited reported in AIR 1994 Kerala 150, wherein it has been
observed that:
When there is no agreement between the parties, express,
regarding the place of payment, if the circumstances warrant, it
could be held that the payment is to be made at the place of the
creditor.
In the present case, purchase orders were placed by
defendant in Mumbai and Invoices were also issued by plaintiff from
Mumbai. The recitals of Tax Invoice issued by plaintiff specifically shows
that those are subject to Mumbai Jurisdiction. Therefore, this court has
jurisdiction to entertain the suit. The observations in the case law are
squarely applicable to the case in hand. Accordingly, I do not found any
substance in the submission of learned Advocate for defendant that this
court has no jurisdiction to entertain the present suit.
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15. Learned Advocate for plaintiff relied upon the matter
of M/s. Sumeet Steel Traders V/s. M/s. Surendra Enterprises and
another reported in AIR 2005 Andhra Pradesh 345, wherein it has
been observed that:
The limitation for suit filed for recovery of price of
goods delivered is three years from date of delivery.
Single suit filed on basis of all delivery challans i.e.
invoices and invoices issued on different dates on every
delivery are separate transactions. Those gives rise to
separate cause of action. Suit filed after three years
from date of some invoices is barred by limitation to
extent of amount involved in such invoices.
In the present case, the invoices are dated 28.10.2015 onwards
and suit is filed on 20.02.2018. Therefore, prima facie it shows that the
suit is filed within the prescribed period of limitation.
16. Learned Advocate for plaintiff relied upon the matter of
M/s. Beacon Electronics V/s. Sylvania & Laxman Ltd. reported in
1998 AIHC 3118 , wherein it has been observed that:
Suit filed on basis of bills raised in the name of
defendant Company incorporating terms and
conditions regarding payment of bill, interest etc. which
amounts to written contract and triable in summary
manner.
In the present case, the goods are supplied to defendant
No.1 through tax invoices on certain terms and condition. Therefore, it
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can be concluded that it amounts to written contract and therefore the
observations in the case law cited are squarely applicable to the case in
hand.
17. Learned Advocate for defendant No.1 has relied upon the
matter of Sudin Dilip Talaulikar V/s Polycap Wires Pvt. Ltd. And
others in Civil Appeal No(s).5528/2019 dated 15.06.2019, before the
Hon'ble Supreme Court of India, Civil Appellate Jurisdiction wherein it
has been observed that:
In a summary suit, if the defendant discloses such facts of
a prima facie fair and reasonable defence, the court may
grant unconditional leave to defend. This naturally
concerns the subjective satisfaction of the court on basis of
the materials that may be placed before it. However, in an
appropriate case, if the court is satisfied of a plausible or
probable defence and which defence is not considered a
sham or moonshine, but yet leaving certain doubts in the
mind of the court, it may grant conditional leave to
defend.
In that case, contention of defendant was that the signature
and the contents of the cheques were in different writing and prosecution
under the Negotiable Instrument Act was subsequently unconditionally
withdrawn on 14.12.2015. Therefore, in that circumstances it was held
that the defendant was entitled for unconditional leave to defend. In the
present case, there is no such contention of defendant No.1 that
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signatures and content of the cheques are in different in handwriting and
that prosecution under section 138 of Negotiable Instrument Act have
been withdrawn by plaintiff. On the other hand, learned Advocate for
plaintiff has submitted on record the copy of proclamation issued against
defendant No.1 under section 82 of Code of Criminal procedure in
Summons Case No.14036/2016. Therefore, with due respect to the
observations laid down in the case law, it is not applicable to the present
case.
18. Learned Advocate of defendant has relied on the
observations in the matter of State Bank of Hyderabad V/s. Rabo Bank
reported in, wherein it has been observed that :
Where the defendant has raised a triable issue or a
reasonable defence, the defendant is entitled to
unconditional leave to defend. Leave is granted to
defend even in cases where the defendant upon disclosing
a fact, though lacks the defence but makes a positive
impression that at the trial the defence would be
established to the plaintiff's claim.
In that case, there was FIR dated 09.08.2019 registered by
the CBI, at the instance of Chief Vigillance Officer SBH and also the
chargesheet filed by the CBI. The chargesheet further alleged that the
officers were not authorized to issue such coacceptances and the motive
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behind on behalf of their illegal and unauthorized action was to enable
the constituent of the respondent to get their bills discounted by
jeopardizing the interest of appellant Bank. In the case in hand, on
behalf of defendant No.1 no material is placed on record to show that
defendant has made out primafacie case or triable issue in the suit which
needs to be adjudicated. Therefore, with due respect, observations laid
down in the case law, it is not applicable to the case in hand.
19. In view of foregoing discussion, it has come on record that
by way of signing the confirmation of account and by issuing 12 cheques
in favour of plaintiff, defendant No.1 has admitted his liability towards
goods supplied to him by plaintiff. The record further shows that
defence raised on behalf of defendant No.1 are illusory and no triable
issue has been raised in order to grant unconditional leave to defendant
No.1. Therefore, in order to protect the interest of plaintiff, it is desirable
to grant conditional leave to defendant No.1 on payment of some
amount. Accordingly, I pass following order.
ORDER
1. Conditional leave to defend the suit is granted to defendant
No.1 on depositing amount of Rs.50,00,000/ in the Court within four
weeks from the date of the order.
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2. On depositing the aforesaid amount in the Court, the
Registrar (Civil) is directed to deposit said amount in any Nationalized
Bank initially for the period of one year and continue to renew the same
for the like period till further order.
3. On depositing amount of Rs.50,00,000/ as directed above
the defendant No.1 is directed to file his written statement within further
period of two weeks.
4. Summons for Judgment No.163/2018, is disposed off
accordingly.
(Jayshri R. Pulate)
Adhoc Judge
City Civil Court,
Gr. Bombay
Date : 03/09/2019
Dictated on : 03.09.2019
Transcribed on : 04.09.2019
Signed on : 07.09.2019
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED ORDER.”
UPLOAD DATE TIME STENOGRAPHER NAME
13.09.2019 10.40 a.m. Ms. Ujwala J. Bhagat
Name of the Judge H.H.J. Jayshri R. Pulate.
Adhoc Judge.
(Court Room No.40)
Date of pronouncement of Order 03.09.2019
Order signed by P.O. on 07.09.2019
Order uploaded on 13.09.2019
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