Final Order 1

Order Details: Other
Pdf Text: MHCC010034032018 Presented on 01/03/2018
Registered on 01/03/2018
Decided on 29/07/2024
Duration 06Y: 04M: 28D
IN THE CITY CIVIL COURT AT MAZGAON, MUMBAI
SUMMONS FOR JUDGMENT NO. 81 OF 2018
IN
SUMMARY SUIT NO. 1240 of 2017
Jayco Metal India Pvt. Ltd., ]
A private limited company ]
registered under companies Act 1956 ]
and having its place of business at ]
Shop No.3, Sainath, Patil Plaza, ]
J. N. Road, Mulund, Mumbai-400 080. ]...Plaintiff
Vs.
Suvinay Aluminium Industries Pvt. Ltd., ]
38, Kapreshwar Kripakapreshwar Marg ]
Off-Sitaram Poddar Marg ]
Poddar Marg, Fanaswadi, ]
Mumbai-400 002. ]...Defendant
Appearance:-
Ld. Advocate Jamshed Ansari for the plaintiff.
Ld. Advocate R. S. Tripati for defendant.
CORAM : HHJ SHRI SANGRAM SHRIHARI SHINDE
C. R. NO. : 81
DATE : 29/07/2024.
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ORDER
( Dictated and pronounced in open Court)
01] The plaintiff has filed this summons for judgment against
defendant on 26/02/2018. Defendant has filed his reply to the
summons for judgment and resisted it and prayed for unconditional
leave to defend the suit. The plaintiff has filed rejoinder to the reply
given by the defendant.
02] As per the plaintiff, plaintiff is a company registered under
the provisions of the Companies Act, 1956 and engaged in the business
of Manufacture and selling of steels etc. The defendant is a company
registered under the provisions of the Companies Act, 1956. As per the
plaintiff, the first week of November, 2010, defendant through its
Director Mr. Kapoorchand Sethia approached plaintiff company to buy
Defendant's immovable property i.e. Gat/plot No.218 (part), Bhiwandi
Wada Road, Village Vadavali, Taluka Wada, Dist. Thane, (hereinafter
referred as said property) for consideration of Rs.1,67,00,000/-.
Further, the said property was adjacent to the plaintiff's property
therefore, he had shown interest for purchase in the said property.
Further, defendant informed the plaintiff that defendant had taken
some loan from Apna Sahakari Bank Limited and to secure the said loan
said property mortgaged. Further, after negotiations with the said bank
it has been agreed to settle the matter for the sum of Rs. 1,07,00,000/-
under one time settlement scheme. It was agreed between the plaintiff
and defendant that plaintiff would pay an amount of Rs.1,07,00,000/-
to the said bank and Rs.60,000,00/- to the defendant. As per the
plaintiff, after the payment of Rs. 23,00,000/- to the defendant, he will
bring Clearance Certificate from concerned authorities. Thereafter,
plaintiff will pay the balance amount of Rs. 37,00,000/-. Further, it was
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agreed that after the payment of Rs. 57,00,000/- to the said bank, the
bank will give photocopy of the title deeds to the plaintiff so as to
investigate of the said property. Thereafter, he will pay the balance
amount of Rs. 50,00,000/- to the said bank.
03] As per the plaintiff, he had paid an amount of
Rs.23,00,000/- to the defendant by cheque and cash and
Rs. 57,00,000/- to the said bank. However, even after making the said
payment, defendant has not provided the requisite documents to the
plaintiff. Therefore, that transaction could not be completed. Therefore,
plaintiff had issued notice u/s. 433 (e) of Companies Act, 1956 on
05/08/2013 and filed Winding up Petition No.334/2015 on
30/11/2013. After filing the said petition, defendant approached the
plaintiff and agreed to make payment of Rs. 80,00,000/-. Further, to
discharge the said liability issued total 11 cheques for sum of
Rs. 48,55,000/-. The said cheques, on presenting in plaintiff's bank
were dishonoured for the reason, "payment stopped by drawer" on
28/08/2015. Therefore, plaintiff has issued demand notice to the
defendant on 02/09/2015 and informed about the dishonour of the
cheques and called upon to make the payment of cheque amount.
Thereafter, defendant approached the plaintiff and agreed for the
settlement and requested not to initiate proceedings. The defendant had
filed reply in the Company Petition and the said petition came to be
dismissed on 10/10/2016. The defendant failed to repay the said
amount of Rs. 48,55,000/- therefore, plaintiff is entitled for interest on
the said amount at the rate of 18% p.a.
04] It is further submitted that plaintiff's case is based on bills
of exchange and therefore, it is maintainable under Order 37, Rule 2 of
C.P.C. Further, the cause of action arose to file the present suit from the
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date of dishonour of cheque therefore, the suit is within limitation.
Further, there is presumption u/s. 118 r/w. 139 of Negotiable
Instruments Act (N. I. Act) that cheques issued were in discharge of
legal liability. Plaintiff has relied on ratio laid down in Rajesh
Laxmichand Udeshi @ Bhatia Vs. Pravin Hiralal Shah, 2003 AIR SCC
1178, Mayur Mangaldas Kotharai Vs. Estate of Late Neeraj Vinayak Vora
Through Uttank Vinayak Vora & Anr., Interim Application (L) No.
2474/2021 in Commercial Summary Suit No. 1148/2019, Iram Feroz
Vs. Ayaz Gadhiya, 2005 SCC OnLine Bom.1431 and IDBI Trusteeship
Services Ltd. Vs. Hubtown Ltd., (2017) 1 SCC 568. The plaintiff has
brought sufficient material to show that he is entitled for decree. On the
contrary, defendant has not brought substantial defence nor raised
triable issues. Hence, summons for judgment may be allowed.
05] On the other hand, it is submitted by the defendant that
the suit filed by the plaintiff on the basis of letter dated 03/03/2010
(page 81 of plaint). The cause of action arose from date of said letter
and suit is filed on 29/08/2017 therefore, suit is not within limitation.
Further, from pleadings in para 3 of plaint, it appears that there is oral
agreement to purchase said property in the month of November, 2010
therefore, plaintiff ought to have filed suit for specific performance. The
plaintiff has filed suit on the basis of 11 dishonour cheques on
28/08/2015 issued by defendant. It is submitted that cause of action for
recovery of alleged debt seems to be accrued on 05/03/2010 when
Company Petition was filed or when defendant failed to perform their
part of contract in June 2011. the suit filed by the plaintiff is beyond 3
years and therefore, it is time barred. Further, it is not the contention of
the plaintiff that defendant has acknowledged his time barred claim in
writing as per Section 25(3) of Indian Contract Act. It is agreed that
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plaintiff failed to perform to redeem the said property within stipulated
time from Apna Sahakari Bank. Plaintiff wants to convert said part
consideration into loan amount. The plaintiff ought to have filed suit for
specific performance. Plaintiff has paid part of loan of defendant.
Defendant has issued 11 cheques it does not amount to
acknowledgment of liability in writing which is already barred by law of
limitation as per Section 25(3) of Contract Act. Therefore, suit is not
within limitation. Defendant has relied on ratio laid down in Kotak
Mahindra Bank Limited Vs. Kew Precision Parts Private Limited &
Others, (2022) 9 SCC 364. The plaintiff has not intentionally joined
Apana Sahakari Bank as a party defendant. The plaintiff has not filed
many documents and also material to show that cash amount was paid
to defendant. The plaintiff has filed the suit on the basis of dishonour of
the cheques and contended that suit is within the limitation.
06] The limitation to file the suit cannot be considered from
the date of dishonour of cheque and period of proceeding of Company
petition cannot be excluded while calculating the period of limitation.
As per the plaintiff, he has paid an amount to the defendant in the year
2010 and 2011, there is no acknowledgment by the defendant within
the period of 3 years and therefore, suit filed by the plaintiff is not
within the limitation. It is further submitted that it was agreed that
amount to be paid to the bank on or before 14/12/2011, however,
plaintiff has not paid the agreed amount to the bank and it is evident
from the Letter dated 23/10/2013 (page 92 of plaint). The defendant
has raised substantial defence and triable issues such as suit is barred by
limitation, there is no acknowledgment, non-joinder of necessary party,
whether cheques were issued for discharge of liability, is present suit is
maintainable under Order 37, Rule 2 of C.P.C. Therefore, defendant is
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entitled for unconditional leave to defend the suit. Defendant has
relied on ratio laid down in M/s. Dynamix Realty V/s. Mystical
Constructions Pvt. Ltd., Summons for Judgment No. 55/2015 in
Summary Suit No. 950/2014 by Bombay High Court, Ms. Purnima
Jaitly Vs. Ravi Bansi Jaisingh, AIR 2003 Bom. 494 and Chintaman
Dhundiraj Vs. Sadguru Narayan Maharaj Datta Sansthan and others,
1956 Bom. 533. Hence, summons for judgment may be dismissed.
07] Perused Summons for Judgment, reply of the defendant,
rejoinder by the plaintiff to the reply of the defendant and documents
on record. Heard both the parties. I have gone through case law cited
on behalf of both parties. As per the plaintiff, there was oral agreement
between plaintiff and defendant in the month of November, 2010 to
purchase said property of defendant for consideration of
Rs.1,67,00,000/-. The said property was mortgaged against loan
borrowed by the defendant from Apna Sahakari Bank Limited (said
bank). The defendant was supposed to pay an amount of
Rs. 1,07,00,000/- to said bank under one time settlement scheme. As
per plaintiff, an amount of Rs. 60,000,00/- was to be paid to defendant
and Rs. 1,07,00,000/- to the said bank. Further, after making payment
of Rs. 23,00,000/- to defendant he would bring clearance certificates
from concerned departments and thereafter balance amount of
Rs. 37,00,000/- is to be paid to defendant. Similarly, it was agreed after
making payment of Rs. 57,00,000/- to said bank, it will provide
photocopy of title deeds for verifications and investigation and
thereafter, balance amount of Rs. 50,00,000/- was to be paid to said
bank. Accordingly, he paid amount however, defendant and said bank
failed to give clearance certificate or photocopy of title deeds of said
property respectively. Therefore, plaintiff claimed said amount from
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defendant and defendant in discharge of liability issued 11 cheques to
the tune of Rs. 48,55,000/-. It is pertinent to note that defendant has
denied said transaction. However, relies on letter dated 03/03/2010
(page No. 81 of plaint) and submitted that parties have negotiated and
required to perform their part of obligations under terms and conditions
of sale. This itself shows that there was some transaction between
plaintiff and defendant with respect to said sale. Admittedly, there is no
written contract between the parties. Even, neither party has pleaded
what were the terms and conditions agreed between the parties, if any
party fails to perform their part what are consequences.
08] Defendant has denied the issuance of cheques however, in
reply to Company Petition No. 334/2015, it is contended that defendant
had wiling to perform their part therefore, issued cheques so that
plaintiff would pay sum to the said bank. Further, contended that as
plaintiff turned down to pay the amount therefore, he got the cheques
dishonoured due to dishonest intention of the plaintiff and its director
to garb the property of the defendant. This shows that defendant had
issued cheques and same were dishonoured. Further, defendant has
contended that it was agreed between the plaintiff and defendant that
the amount has to be paid within 14/12/2011 as mentioned in letter
dated 23/10/2013 (page No. 92 of plaint) and defendant has failed to
pay the agreed amount. On perusing said letter itself, it appears that
plaintiff has paid an amount to said bank. Further, though defendant is
contending that plaintiff has not performed his part however, there is no
specific denial that plaintiff has not paid amount to the said bank and to
the defendant.
09] As per the plaintiff, title was defective therefore, he
claimed amount with defendant. Thereafter, plaintiff had filed Company
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Petition No.334/2015 against defendant for winding up of the
defendant company. The company petition came to be dismissed on
10/10/2016. It is the contention of the plaintiff that during pendency of
the said company petition, defendant has admitted liability and
accordingly issued 11 cheques to repay amount paid by the plaintiff.
Admittedly, there is no written acknowledgment by the defendant.
10] It is pertinent to note that defendant has raised issue of
limitation and maintainability of the suit. As it is the contention of the
defendant that as per contention of the plaintiff there was a oral
agreement between the parties to purchase said property from
defendant then, plaintiff ought to have filed suit for specific
performance. It appears that plaintiff has filed suit on the basis of
dishonour of cheques. As per ratio laid down in Iram Feroz Vs. Ayaz
Gadhiya's case cited supra on behalf of the plaintiff is maintainable
under Order 37, Rule 2 of C.P.C. Further, in view of ratio laid down in
Rajesh Laxmichand Udeshi @ Bhatia Vs. Pravin Hiralal Shah's case
cited by plaintiff there is presumption that cheques were issued for
discharge of liability. On the contrary, ratio laid down in Ms. Purnima
Jaitly Vs. Ravi Bansi Jaisingh's case cited by the defendant is not
applicable to the facts of present case, as in the said case suit was filed
on the basis of cheque issued by the plaintiff himself and not defendant.
In the present case suit is based on cheque issued on the basis of
cheques issued by the defendant.
11] So far as issue of limitation is concerned, it is the
contention of defendant that limitation commences from letter dated
03/03/2010 or from November 2010 as pleaded by the plaintiff.
Further, it is contended that cause of action may occurred in the month
of June 2011 or 30/11/2013 when company petition was filed. Further,
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period of pendency of company petition can not be excluded. The date
of dishonour of cheques cannot be date of cause of action. On the
contrary, it is the contention of the plaintiff that suit is within limitation
as it is filed within 3 years from the date of dishonour of cheques.
Admittedly, cheques are dated 26/08/2015 and dishonoured on
26/08/2015 itself for reason 'payment stopped by drawer'. Defendant
has relied on ratio laid down in Kotak Mahindra Bank Limited Vs. Kew
Precision Parts Private Limited & Others's acknowledgment after time
barred debt will not extend limitation. It is pertinent to note that in said
case account of corporate debtor with appellant financial creditor was
declared NPA on 30/09/2015 and he was relying on proposal for one
time settlement dated 12/12/2018. It is pertinent to note that fact in
the present case are not identical to said case therefore, said case law is
not applicable to the facts of present case. Further, defendant has relied
on ratio laid down in Chintaman Dhundiraj Vs. Sadguru Narayan
Maharaj Datta Sansthan and others's case on the point that as section
19 would be applicable if payment is made before expiry of prescribed
period by the person liable to pay the debt. As discussed above, there is
nothing on record to show that what are the consequences or reliefs if
one of the party fails to perform their part. Thus, it appears that there is
not prescribed period agreed between the parties.
12] However, present suit is based on dishonour of cheque
dated 26/08/2015 and suit is filed on 29/08/2017. Therefore, case law
cited by the defendant is not applicable to the facts of present case.
Even, observations in M/s. Dynamix Realty V/s. Mystical Constructions
Pvt. Ltd., Summons for Judgment No.55/2015 in Summary Suit No.
950/2014 by Bombay High Court's case are not applicable as in the said
case there was prescribed period to pay balance amount. As discussed
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above, there is no prescribed to make payment. Thus, considering facts
of the present case and ratio laid down in case laws cited by defendant
are not applicable to the present case even, question of invoking section
25(3) of Indian Contract does not arise. On the contrary, observations in
Mayur Mangaldas Kotharai Vs. Vinayak Vora, Interim Application (L)
No.2474/2021 in Commercial Summary Suit No.1148/2019 is
applicable i.e. suit can be filed within 3 years from the date of
dishonour of cheque. As per Section 118 of N. I. Act, there is
presumption that if cheques are issued it is in discharge of legal liability.
It is pertinent to note that defendant has not denied of issuance of
cheques or its execution. Admittedly, cheques are dishonoured for the
reason, "payment stopped by drawer" on 28/08/2015 and suit is filed
on 29/08/2017. Therefore, if it is considered limitation from the date
of dishonour of cheque it is within limitation.
13] Further, on perusing Letter dated 23/10/2013 issued by
the bank to the plaintiff, it appears that the amount was to be paid to
the bank upto 14/12/2011. Admittedly, plaintiff has not paid agreed
amount to the bank. It is the contention of the plaintiff that defendant
had not provided required documents. It is pertinent to note that the
plaintiff has not produced any letter on the record to show that after
making the payment he had issued letter or notice to the defendant or
to the bank and call upon to provide the documents. It is the contention
of the plaintiff that title of the property was found to be defective. Even,
it is the contention of the defendant that as plaintiff has not performed
his part, defendant has sustained heavy loss. Certainly, these issues
require adjudication. Thus, it appears that defendant has failed to raise
substantial defence that he is likely to defend the suit or raised any
triable issues indicating that he has fair and reasonable defence.
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Moreover, by issuing cheques to the plaintiff, defendant has admitted
liability for an amount of Rs. 48,55,000/-. Therefore, in view of ratio
laid down in IDBI Trusteeship Ltd. Vs. Hubtown Ltd.'s case, I am of the
view that it is necessary to give an opportunity to the defendant to
defend the suit. However, it would be proper to justifiable to grant such
leave subject to condition of depositing an amount of Rs. 48,55,000/-.
Hence, I proceed to pass following order.
ORDER
1) Summons for Judgment No.81/2018 in Summary Suit
No. 1240/2017 is disposed off as follows:
(a) Leave to defend the suit is granted to the defendant subject
to condition that defendant shall deposit an amount of
Rs. 48,55,000/- within 60 days from the date of this order.
(b) The defendant will be at liberty to file its written
statement on record within 30 days after depositing amount.
2) After depositing amount by the defendant, it be deposited in fixed
deposits in any Nationalized bank initially for a period of two
years and then subsequently, if required renew it every year.
3) No order to costs.
4) Summons for Judgment No.81/2018 is disposed off accordingly.
(Sangram S.Shinde)
Adhoc Judge,
City Civil Court Mazgaon, Mumbai.
Date: 29/07/2024 Court Room No.81
Dictated on : 29/07/2024
Corrected & signed on :01/08/2024
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
UPLOAD DATE NAME OF STENOGRAPHER
01/08/2024 Mrs. V. V. Malgaonkar
Name of the Judge
(with Court Room No.)
Shri S. S. Shinde
C.R. No.81
Date of Pronouncement of JUDGMENT/
ORDER 29/07/2024
JUDGMENT/ORDER signed by P. O. on 01/08/2024
JUDGMENT/ORDER uploaded on 01/08/2024
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