Final Order 2

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MHCC010032202019
IN THE COURT OF JUDGE, CITY CIVIL COURT
AT GREATER BOMBAY
SUMMONS FOR JUDGMENT NO. 113 OF 2019
IN
SUMMARY SUIT NO. 369 OF 2018
Mr. Papu Mukund Choudhary, Aged 46 years
of Bombay Indian Inhabitant residing at
Room No.308, Anuradha Complex, Masal
Chowk, Airport Road, Nanidaman
...Plaintiff
VERSUS
Pravash Ranjeetprasad Chaudhary of
Bombay Indian Inhabitant Residing at Room
No.5, Birju Patel Chawl, Cornarwala Room,
Gaodevi Road, Amrut Nagar, Ghatkopar (W),
Mumbai-400 086.
And also residing at Flat No.I-245, Sagar
Park Society, Amrut Nagar, Ghatkopar (W),
Mumbai 400 086.
...Defendant
Appearance :
Ld. Adv. Ms. Shradha Kumar i/b. Adv. K. Andrews for plaintiff.
Ld. Adv. Arvind Taral for defendant.
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CORAM : DR. S. D. TAWSHIKAR
(Court Room No.61)
Heard on : 26-04-2023
Decided on: 26-04-2023
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 defendant for recovery of principal amount of
Rs. 6,50,000/- along with interest thereon at the rate of 18% p.a. from
the date of filing of the suit till its full realization.
Plaintiff’s case-
2. Plaintiff claims to have lent certain amount to the plaintiff
as a hand loan. Defendant for the repayment, issued two cheques in
favour of the plaintiff and one cheque in favour of plaintiff’s father. The
present case pertains to recovery of sum of Rs.6,50,000/-, owing to
dishonour of he cheque No.2019 dated 06-12-2017 issued by the
defendant in favour of plaintiff.
3. Ld advocate for the plaintiff submits that the cheque was
issued towards part repayment of hand loan. The cheque was tried to be
encashed, same was dishonoured for the reason payment stopped by
drawer. The copy of cheque and cheque return memo is placed on
record.
4. Ld advocate for the plaintiff further submits that plaintiff
had issued a notice under section 138 of Negotiable Instruments Act,
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1881 (NI Act) seeking payment against two dishonoured cheques
including one involved in the present suit. Despite notice, defendant
failed to pay the said amount and hence present suit is filed.
5. Ld advocate for plaintiff submits that defendant has no
defence at all. Plaintiff enjoys statutory presumption under section 118
and 139 of NI Act. Defendant has come with the vague defence and
therefore SJ be made absolute.
Defendant’s case-
6. Per contra, defendant seeks unconditional leave to defend
by filing detailed affidavit-in-reply. Defendant has come with the case
that the transaction was not of hand loan. Defendant had supplied
certain goods to the plaintiff and as per the business practices, he had
issued certain cheques in favour of father of the plaintiff as a security
for transaction. Thereafter defendant supplied goods to the plaintiffs
father. After supply of goods, plaintiff’s father paid a sum of
Rs.6,50,000/-by RTGS. However, the cheques issued for security were
not returned. He submits that cheques thereafter were misused by the
plaintiff and the present suit is filed.
7. Ld. advocate for defendant submits that plaintiff has not
placed on record anything to show that the hand loan was ever paid to
the defendant. No details of the payment are placed on record or even
pleaded by the plaintiff in entire plaint. He further points out that there
is no receipt as such to receipt for acknowledgment obtained by the
plaintiff at the time of alleged hand loan.
8. Mr. Taral further points out that though the demand notice
u/sec. 138 of NI Act was issued on 19-12-2017, however the suit is filed
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in year 2019. So also no legal proceedings seem to have initiated by
plaintiff for dishonour of second cheque mentioned in the notice. He
further submits that there is considerable delay on the part of plaintiff
to take out SJ. He, thus submits that in view of rule 119 (4) of Bombay
City Civil Court Rules, 1951, the present SJ deserves to be dismissed.
Points-
9. 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 :-
Sr. No. Points Findings
1. Whether defendant is entitled for
leave to defend ?
If yes, conditional or unconditional?
Unconditional leave to
defend is granted to the
defendant.
2. What order ? SJ is rejected.
REASONS
As to Point No.1-
10. It is settled position of law that while dealing with the
Summons for Judgment viz-a-viz leave to defend, Court is not supposed
to delve deep on merits of either side. The court is expected to examine
whether the defendant raises substantial defence or some issues which
needs to be tried. With a view to examine this aspect, it is necessary to
ponder on the contentions and documents relied upon by both the
sides.
11. The Hon’ble Apex Court in the IDBI Trusteeship Services
Limited Vs. Hubtown Limited, (2017) 1 SCC 568, has dealt with various
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situation wherein leave to defend can be granted or refused. The
Hon’ble Apex Court in Para No.17 has laid 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.
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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 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.”
12. Ld advocate for plaintiff contends that plaintiff has in fact
extended a hand loan of Rs.20,58,000/- to the defendant. Out of the
said amount Rs.13,08,000/- is paid through RTGS and Rs.7,50,000/- is
paid by cash. He submits that in all three cheques were issued by the
defendant towards repayment of the said loan. He further placed on
record copy of joint account of plaintiff and his father maintained with
Central Bank of India and points out certain entries to show the
payment of loan amount.
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13. Ld advocate for the defendant has also tendered on record
copy of Bank Passbook of defendant and points out receipt of sum of
Rs.6,50,000/- from the father of the plaintiff by RTGS.
14. Though the plaintiff contends disbursement of huge
amount of Rs.20,58,000/- to the defendant as a loan, surprisingly the
said payment seems without any security. Even a receipt or
acknowledgment to that effect is not obtained from the defendant.
Therefore, at this stage, I find it difficult to believe the case of plaintiff
to have paid such huge amount as a hand loan. Plaintiff has not pleaded
these things in the plaint. It is difficult to consider the oral submissions
without pleadings to that effect. So also there is considerable delay in
filing summons for judgment. It shows laxity on the part of the plaintiff,
however, that cannot be the sole ground to grant unconditional leave to
defend. Defendant ought to have applied for dismissal of suit as per
Rule 119 of the Bombay City Civil Court Rules.
15. Defence of supply of giving undated cheques for security to
the plaintiffs father is also not believable at this stage. There is nothing
placed on record to show such business relations between defendant
and plaintiff’s father. Not a single purchase order or invoice is placed on
record along with affidavit-in-reply.
16. Thus, in the matter in hand, it is difficult to believe the case
of the plaintiff as well as the defence tried to be canvassed by the
defendant. In such situation plaintiff cannot get benefit of the statutory
presumptions under NI Act. The case of plaintiff needs to be tested on
evidence. In view of the aforesaid guidelines of the Hon’ble Apex Court,
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I find it would be just and proper to grant unconditional leave to defend
so as to afford chance to defendant to establish its defence, though it
seems plausible one.
17. I find that there are certain triable issues involved in the
matter with respect to the alleged payment of hand loan by the plaintiff
and the alleged supply of goods by the defendant. These issues needs to
be tested on trial. Hence, unconditional leave to defend is granted.
18. In the light of the guidelines issued by the Apex Court I find
that the case of the defendant falls in clause No. 17.1. There is sufficient
material on record to grant unconditional leave to defend to the
defendant. Hence, I answer point No.1 accordingly.
As to Point No.2-
19. In view of the above, I hold that defendant is entitled for
unconditional leave to defend. Consequently, Summons for Judgment is
bound to dismiss.
20. It is made clear that observations made in this order are
prima facie and without prejudice to the rights of the parties during the
trial.
21. In view of the above, I pass following order-
ORDER
A. Summons for Judgment No.113 of 2019 stands rejected.
B. Unconditional leave to defend is granted to the defendant.
C. Defendant to file Written Statement on or before 12-06-2023.
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D. Summons for Judgment No.113 of 2019 is disposed of
accordingly.
(Dr. S. D. Tawshikar)
Judge, City Civil Court, Gr. Mumbai.
Date: 26-04-2023. Court Room No.61
Dictated on : 26-04-2023
Transcribed on : 29-04-2023
Corrected on : 29-04-2023
Signed on : 29-04-2023
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
29-04-2023 at 5.55p.m. Mrs. V. V. Malgaonkar
Name of the Judge
(with Court Room No.)
Dr. S.D. Tawshikar
C.R. No.61
Date of Pronouncement of JUDGMENT/
ORDER
26-04-2023
JUDGMENT/ORDER signed by P. O. on 29-04-2023
JUDGMENT/ORDER uploaded on 29-04-2023
JUDGMENT/ORDER Re-uploaded as per
roznama dated 22-05-2023
22-05-2023
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