Interim Order 1

Order Details: Copy of Judgment
Pdf Text: SJ 120/18 SUM.SUIT 1128/2017 1
MHCC010044262018
IN THE CITY CIVIL COURT AT MUMBAI
SUMMONS FOR JUDGMENT 120 OF 2018
IN
SUMMARY SUIT NO. 1128 OF 2017
(UNDER ORDER XXXVII THE CODE OF CIVIL PROCEDURE 1908)
(CNR.NO.MHCC01-004426-2018)
Rajkumar Mohansing Bajaj,
Age: 54 years,
carrying on business in the name
and style M/s. Pride Investments,
a Proprietory Concern as its Sole
Proprietor at 602F, Neelkanth,
98, Marine Drive, Mumbai-400 002. ...Plaintiff
Versus
1. Meena 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
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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.6,90,200/-
(Rupees Six Lakhs Ninety Thousand Two Hundred Only) with Pendente
Lite and future interest at the rate of 18% p.a. on the principal amount
of Rs.5,60,000/-.
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. For
valuable consideration, defendant No.1 drawn 3 bills of exchange dated
23/12/2015 for Rs.3,30,000/-, dtd. 24/04/2016 for Rs.1,10,000/-, dtd.
25/04/2015 for Rs.1,20,000/-, on defendant No.2 and in favour of the
plaintiff. However, on 25/05/2016 when the plaintiff presented the said
bills of exchange, both defendants No.1 & 2 dishonoured the same by
non payment. However, they promised to pay the amount within a short
time. Thereafter, the defendants, towards repayment of the 3 bills of
exchange, issued 3 cheques all dtd. 21/06/2017 for the amounts of 3
different bills of exchange. However, when the plaintiff presented the
cheques, the same were dishonoured with remarks 'funds insufficient'.
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The plaintiff several times called upon the defendants to pay the total
amount of Rs.5,60,000/- of the three bills 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 defendant was Rs.6,90,200/-.
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 bills of exchange
were drawn by defendant No.1 on defendant No.2. According to the
defendants, amounts of Rs. 2,75,000/- on 06/01/2016, Rs.1,00,000/-
on 22/01/2016, have been paid to the plaintiff by cash by defendant
No.1 and his authorized person towards the bill of exchange dated
23/12/2015 along with interest thereon. In respect of bills of exchange
dated 24/04/2016 and 25/04/2016, along with interest thereon,
defendant No.1 made payment of Rs.2,75,000/- on 02/05/2016. Thus,
the defendants have paid in total Rs.6,50,000/- to the plaintiff. The
defendants paid entire principal amount with interest to the plaintiff.
The plaintiff had assured that the blank undated security cheques will
be handed over to the defendants after 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, he
requested to grant unconditional leave to defend.
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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.5,60,000 /- 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 bills of exchange. Thus, the issuance of bills 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
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
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argued that the bills of exchange were 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
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
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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
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
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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 3 bills of exchange
dtd.23.12.2015, 24.04.2016 and 25.04.2016 for Rs.3,30,000/-,
Rs.1,10,000/- and Rs.1,20,000/- respectively. Thus, the amount of
Rs.5,60,000/- was due and payable by the defendant for which the
defendant had issued 3 cheques dtd.21.06.2017 which came to be
dishonored. The defendants in their reply at one place denied that
any bills of exchange were drawn. However, at other place taken a
plea that they have made full payments to the plaintiff towards the
bill of exchange. Thus, the contentions of the defendants are self
contrary. The defendants also took a plea that amount of
Rs.6,50,000/- has been already paid by them as Rs.2,70,000/- on
06.01.2016, Rs.1,00,000/- on 22.01.2016 and Rs.2,75,000/- on
02.05.2016, in cash to the plaintiff. Thus, according to the
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defendants amount of Rs.5,60,000/- with interest was already paid
by them in cash to the plaintiff. However, this court must take into
consideration that the defendants issued bills of exchange in
favour of the plaintiff, they had issued cheque to the plaintiff.
Keeping in view the manner of formality between the parties, 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.5,60,000/-. 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.5,60,000/-
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.5,60,000/- in the court. In answer to point No.3 order as
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follows is passed:
ORDER
1. The summons for judgment 120 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.5,60,000/- (Rupees Five Lakhs
Sixty 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
CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL SIGNED
JUDGMENT/ORDER.”
13/03/2020 at 3.45p.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 13/03/2020
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