Final Order 1

Order Details: Other
Pdf Text: 1 SJ No.7018
IN THE BOMBAY CITY CIVIL COURT AT BOMBAY
SUMMONS FOR JUDGMENT NO.70 OF 2018
IN
SUMMARY SUIT NO.3275 OF 2011
(HIGH COURT SUMMARY SUIT NO.511 OF 2011)
(UNDER ORDER XXXVII OF THE CODE OF CIVIL PROCEDURE 1908)
Gurpreet Kaur Dhami ]...Plaintiff
V/s.
M/s. Shalimar Auto Services & Ors. ]...Defendants
Advocate Mr. Phogat for the plaintiff.
Advocate Mr. Giriraj for defendant nos.1 and 2.
CORAM : HER HONOUR JUDGE
SMT. KALPANA S. HORE
COURT ROOM NO.14
DATED : 10th APRIL, 2019.
ORDER
1. The plaintiff has taken summons for judgment.
Brief facts of the suit are as under:
2. Plaintiff is daughter in law of defendant no.3 and the defendant
no.2. Defendant no.1 is a Partnership Firm duly registered under the
Partnership Act and defendant nos.2 and 3 are the partners of
defendant no.1 firm M/s. Shalimar Auto Services.
3. Plaintiff's contention is that in or about September, 2003 the
defendant no.2 through defendant no.3 requested the plaintiff to
advance loan to the Partnership Firm of M/s. Shalimar Auto Services,
defendant no.1 at interest rate of 13.5% per annum. At the request of
the defendant no.2, the plaintiff from 03.10.2003 to 05.07.2005 lent
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and advanced a loan to the defendant no.1 aggregating to
Rs.3,25,000/ on interest at the rate of 13.5% per annum by three
cheques viz. I) Cheque no.110712 drawn on IDBI Bank, Chembur dated
03.10.2003 for Rs.1,00,000/, ii) Cheque no.110713 drawn on IDBI
Bank, Chembur dated 06.10.2003 for Rs.1,00,000/ and iii) Cheque
no.110733 drawn on IDBI Bank, Chembur dated 05.07.2005 for
Rs.1,25,000/. The defendants agreed to pay the interest on the said
loan at the rate of 13.5% per annum.
4. Plaintiff's further contention is that after plaintiff lent and
advanced the said loan of Rs.3,25,000/. Defendants were also paying
interest to the plaintiff at the rate of 13.5% per annum on the balance
outstanding amount of Rs.3,25,000/ due and payable by the defendant
no.1 kept on paying the interest on the outstanding balance amount of
Rs.3,25,000/ at the rate of 13.5% per annum upto 28.02.2008.
Defendant no.2 as the partner of defendant no.1 had issued T.D.S.
Certificate from time to time except for the period from 01.04.2007 to
March, 2008 to the plaintiff for Tax Deduction at source from the
interest paid by the defendants to the plaintiff on the said amount at the
rate of 13.5% per annum.
5. Plaintiff's further contention is that for the reasons best known to
the defendants, they stopped paying even the interest on the
outstanding amount payable by the defendant no.1 to the plaintiff from
28.02.2008.
6. Plaintiff's further contention is that on making enquiry, the
plaintiff came to know that there are serious disputes and differences
between the defendant nos.2 and 3 as regards the Partnership business
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of M/s. Shalimar Auto Services, with the result, the plaintiff, time
without numbers, requested the defendant no.2 being the partner in
control of the Partnership business of M/s. Shalimar Auto Services to
pay the outstanding amount of Rs.3,25,000/ alongwith interest at the
rate of 13.5% for the period from 01.03.2008 to 31.08.2010 amounting
to Rs.1,09,686/ aggregating to Rs.4,34,686/.
7. Plaintiff's further contention is that inspite of repeated oral
requests made by the plaintiff from time to time, the defendants failed
and neglected to pay the amount so, the plaintiff by notice dated
21.09.2010 made request to the defendants but the notice was sent to
the defendant nos.1 and 2 so, the plaintiff filed the suit for recovery of
Rs.4,52,966/ with future interest on Rs.3,25,000/ at the rate of 13.%
per annum.
8. Defendants appeared. The plaintiff has taken summons for
judgment.
9. Plaintiff's contention is that plaintiff has deposited amount with
the defendants. Defendants are liable to pay the amount. Defendant
no.2 filed reply on 25.10.2016 on behalf of defendant nos.1 and 2.
10. His contention is that three summary suits have filed
simultaneously by three different plaintiff who are all relatives of
defendant nos.2 and 3. Defendant nos.2 and 3 are real brothers. It is
contended that there is arbitration reference pending by and between
defendant nos.2 and 3 being Reference nos.216 and 226 of 2018. In the
Arbitration Reference no.216 of 2018 filed by the defendant no.3
against defendant no.2, it has been claimed that defendant no.1 herein
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is a Partnership Firm and defendant no.3 herein has rights as a partner
in the said Firm. However, the defendant no.2 has been denied that the
defendant no.1 is a Partnership Firm. It is contended that defendant
no.1 is a sole proprietary concern of defendant no.2. It further
contended that present suit is nothing but a collusive suit in order to
harass defendant no.2 and defendant no.1 which is his proprietary
concern. His contention is that in order to evidence the said fact, it is
necessary to draw attention to para 12 of the statement of claim filed by
the defendant no.3 herein. In fact, it is necessary to note the extract of
para12 which reads as under:
“For installation of CNG filling station the claimant
has through his relatives contributed Rs.9,00,000/
and also contributed additional amount from his
capital amount of the partnership firm.”
There is categorical admission on the part of defendant no.3 “as
claimant therein” that he has through his relatives contributed
Rs.9,00,000/ and it is categorically stated that defendant no.1 is a
Partnership Firm. However, the question whether the defendant no.1 is
a partnership or proprietary firm is yet to be decided and is under
adjudication before the Sole Arbitrator. Therefore, if the said amount is
sought to be claimed by the plaintiff against the said Partnership Firm
and if there is a finding to that effect by the Sole Arbitrator that it is not
a partnership firm but a proprietary concern, then the entire case of the
plaintiff falls to the ground.
11. Defendant's further contention is that statements would show
that unless and until there is a finding from the Ld. Sole Arbitrator, as
to whether the defendant no.1 is a partnership or proprietary concern,
no claim can be made by the plaintiff against the defendant no.1 herein,
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which as it stands today is a proprietary concern so, defendant seeking
that it is necessary to adjourn the matter till the outcome of the Arbitral
Reference Nos.216 and 226 of 2008 or in the alternative to grant
unconditional leave to defendant to defend the suit.
12. I have heard Advocate for both the parties.
13. Advocate for plaintiff submitted that the defendant no.1 is a
Partnership Firm. Defendant nos.2 and 3 are the partners. Even though
plaintiff is a relative of defendant nos.2 and 3, she is third party to
Partnership Firm and she has paid the loan amount to the Partnership
Firm with interest then defendants are liable to refund amount. He
further submitted that plaintiff made payment by cheque in the name of
defendant no.1 which was reflected in the account of defendant no.1.
He further submitted that defendant no.1 Partnership Firm issued TDS
Certificate to the plaintiff for the purpose of Income Tax so, it clearly
shows that plaintiff paid the amount as a loan to the Partnership Firm
and defendant nos.2 and 3 are partners and they are liable to pay the
amount to the plaintiff. Advocate for plaintiff produced copies of
Partnership Firm and registration certificate to show that defendant
no.1 is a registered Partnership Firm. He further submitted that even
though there is arbitration proceedings between defendant nos.2 and 3
about defendant no.1, the defendants cannot denied the liability so,
defendants ought to have pay the amount and there is no legal and
valid defence to the defendant nos.1 and 2.
14. Advocate for defendants submitted that admittedly arbitrary
reference is pending between defendant nos.2 and 3. In arbitrary
proceedings, the defendant no.3 claiming that defendant no.1 is a
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Partnership Firm and arbitration is for declaration that defendant no.1
is a Partnership Firm and for dissolution of account. In that arbitrary
reference the defendant no.2 specifically raised the objection that
defendant no.1 is a proprietary business of defendant no.2 and it is not
a partnership firm so, the arbitrator has framed the points whether
defendant no.1 is a partnership firm or proprietary firm so, till decision
of arbitrator proceedings, the plaintiff cannot file suit and cannot claim
the amount. He further submitted that plaintiff being the relative of
defendant no.3 filed the suit in collusive with defendant no.3. Advocate
for defendants produced copies of arbitrator proceedings and statement
of claim and counter claim. He further submitted that if there is triable
issue the sense that there is a fair dispute to be tried as to the meaning
of a document on which the claim is based for uncertainty as to the
amount actually due then unconditional leave should be granted to the
defendant to defend the suit under Order 37 Rule 2 of the Code of Civil
Procedure. He relied upon Raj Duggal V/s. Ramesh Kumar Bansal,
AIR 1990 SC 2218, M/s. Sunil Enterprises and Anr. V/s. SBI
Commercial and International Bank Ltd., MANU/SC/0334/1998
equivalent citation: AIR 1998 SC 2317, Sandvik Asia Limited V/s.
M/s. Vardhman Promoters Pvt. Ltd., (2003) ILR 2 Delhi 405, Sanjay
Mishra V/s. Ashwani Kumar Gandhi and Anr.,
MANU/DE/8610/2006 and Mechelec Engineers & Manufacturers
V/s. Basic Equipment Corporation, AIR 1977 SC 577.
15. Advocate for plaintiff submitted that defendant no.2 not denied
the receipt of loan from plaintiff, only he disputed that the defendant
no.1 is not a partnership firm and it is sole proprietary so, the defendant
has no triable issue therefore, the authorities are not applicable in the
present case.
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16. I have gone through these authorities. The Hon'ble Supreme
Court laid down the proposition a) If the defendant satisfies the Court
that he has a good defence to the claim on merits, the defendant is
entitled to unconditional leave to defend. b) If the defendant raises a
triable issue indicating that he has a fair or bonafide or reasonable
defence, although not a possibly good defence, the defendant is entitled
to unconditional leave to defend. c) If the defendant discloses such facts
as may be deemed sufficient to entitle him to defend, that is, if the
affidavit discloses that at the trial he may be able to establish a defence
to the plaintiff's claim, the Court may impose conditions at the time of
granting leave to defend the conditions being as to time of trial or made
of trial but not as to payment into Court or furnishing security. d) If the
defendant has no defence, or if the defence is sham or illusory or
practically moonshine, the defendant is not entitled to leave defend. e)
If the defendant has no defence or the defence is illusory or sham or
practically moonshine, the Court may show mercy to the defendant by
enabling him to try to prove a defence but at the same time protect the
plaintiff imposing the condition that the amount claimed should be paid
into Court or otherwise secured.
17. I have gone through the pleadings of both the parites. Plaintiff
has produced documents to show that defendant no.1 is a Partnership
Firm and also Deed of Partnership between defendant nos.2 and 3. The
plaintiff also produced certificate of deduction of taxes under section
203 of the Income Tax Act, to show that defendant no.1 deducting tax
and gave certificate to plaintiff. The details of deduction shows the date
of payment of interest from 20.04.2004 to 15.03.2005. Defendant
deducted income tax and deposited by challan into Central Government
account through Bank of Baroda. The plaintiff also produced account of
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defendant no.1, which shows plaintiff deposited or paid loan of
Rs.3,25,000/. It also shows that unsecured loan in the name of
plaintiff on 31.03.2008 so, prima facie shows the plaintiff deposited
amount with interest with the defendant no.1.
18. Defendant produced documents to shows that there is arbitrator
reference is in respect of Partnership Firm of M/s. Jagat Singh & Sons
and another arbitration proceedings is filed by defendant no.3 against
the present defendant nos.1 and 2 claiming M/s. Shalimar Auto
Services is Partnership Firm being Arbitration Reference no.216 of
2008. Reference no.216 of 2008, points for determination were
framed, “Whether Mohan proves that M/s. Shalimar Auto Service is a
Partnership Firm constituted under the Deed of Partnership dated
13.11.1979 and Mohan and Sohan are partners of the said registered
firm having 50% share in the profits, loss, assets and property of the
partnership firm ? One of the point is also Sohan i.e., defendant no.2
prove that he alone was running the firm of M/s. Shalimar Auto Service
as a proprietary concern” and dispute is pending. I find that even
though dispute is pending before arbitration about the Partnership Firm
of defendant no.1, the plaintiff has deposited an amount with interest
with defendant no.1 of which defendant nos.2 and 3 are partners.
Defendant no.2 is claiming is a sole proprietary. Without admitting but
assuming he is sole proprietary, if the plaintiff deposited amount with
interest for the business of M/s. Shalimar Auto Service then defendant
no.2 is to deposit amount in the Court till the arbitrator proceedings is
decided and to decide the liability of Partnership Firm so, I find that as
per the principle laid down by the Hon'ble Supreme Court for granting
leave to defend the suit as the arbitrary proceedings is pending to show
mercy to the defendant by enabling him to try to prove a defence that
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he is a sole proprietary of defendant but at the same time to protect the
plaintiff as plaintiff has deposited amount for business of M/s. Shalimar
Auto Service, then, it is necessary to impose conditions on the
defendant no.2 that 50% of suit claim should be deposited in the Court.
I also find that defendant no.3 claiming as partner of defendant no.1
therefore, I find that defendant no.2 to deposit 50% of suit amount i.e.,
Rs.2,26,483/. With this discussion, I find that summons for judgment is
to be disposed of by granting leave to defendant no.2 to defend the suit
on depositing 50% of suit amount within one amount and to file written
statement and accordingly, I proceed to pass the following order :
O R D E R
(i) Conditional Leave is granted to the defendant no.2 to
defend the suit on depositing 50% of suit amount i.e.,
Rs.2,26,483/ and to file written statement within one
month from the date of order.
(ii) On failure of defendant to deposit the amount within
one month, the plaintiff is at liberty to apply for further
reliefs.
(iii) The Summons for Judgment No.70 of 2018 stands
disposed off accordingly.
( KALPANA S. HORE )
Judge,
Dated : 10/04/2019 City Civil Court, Gr. Mumbai
Dictated on : 10/04/2019
Transcribed on : 10/04/2019
Signed on : 10/04/2019
“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE
ORIGINAL SIGNED JUDGMENT/ORDER.”
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HHJ Smt. K. S. HORE (CR 14)
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JUDGEMENT /ORDER
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