Order 1

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Pdf Text: SUMMONS FOR JUDGMENT 161/18 1
IN THE BOMBAY CITY CIVIL COURT AT MUMBAI
SUMMONS FOR JUDGMENT NO. 161 OF 2018
IN
SUMMARY SUIT NO. 90 OF 2018
(CNR.NO.MHCC010065892018)
Aditya Inderchand Daga HUF, a Hindu
Undivided family having address at
21, Raj Niketan, 24, B.G. Kher Marg,
Mumbai 400 006, through its Karta
Aditya Inderchand Daga. ...Plaintiff.
V/s.
1. K.P. Packaging Limited, a company
Incorporated under the Companies Act,
1956, having its registered office at
Plot No. 32, Near Nagpada Circle,
13th Kamathipura Lane, Nagpada,
Mumbai 400 008.
2. Ketan Madhukant Vira, age: not known
Director of K.P. Packaging Limited,
having residence address at 602,
Ashish Tirupati Apartments,
Bhulabai Desai Road, Mumbai 400 026
and C/o K.P. Packaging Limited,
at Plot No. 32, Near Nagpada Circle,
13th Kamathipura Lane, Nagpada,
Mumbai 400 008. ...Defendants
Appearances:
Advocate Mr.Yashpal Jain for the Plaintiff.
Advocate Mr.J.P.Thakkar for the Defendants.
CORAM : HIS HONOUR JUDGE
M.S.LONE
(C.R.NO.28)
DATED : 30TH AUGUST 2019
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SUMMONS FOR JUDGMENT 161/18 2
O R D E R
This summons for judgment is taken out seeking decree against
the defendants to pay to the plaintiff the sum of Rs.62,36,100/ (Rupees
Sixty Two Lacs Thirty Six Thousand and One Hundred Only) with
future interest.
2. The plaintiff’s case in nutshell is that the plaintiff is a Karta of its
Hindu Undivided Family. Defendant no. 1 is a registered company and
defendant no. 2 is its director. One Vijay Aggarwal introduced plaintiff
to defendant no. 2. In a meeting defendant no. 2 requested loan for the
financial assistance of defendant no. 1. Upon defendant no. 2 persistent
request and assurances, plaintiff and his wife from time to time i.e. from
April 2014 to August 2014 advance short term loans to defendant no. 1
@ of 18% p.a. interest. In the month of August 2014 plaintiff advance a
sum of Rs. 30,00,000/ by cheque to defendant no. 1. Further in month
of August, 2014 plaintiff advanced a sum of Rs. 10,00,000/ by cheque
to defendant no.1 The defendant no. 1 paid the interest on the above
sum upto August, 2015.
3. It is further case of plaintiff that on the month of November.
2014the defendant no. 2 represented that due to problem in accounting
and income tax, defendant no. 2 wanted to clear the loan amount from
the books of the defendant no. 1 and he repaid the amount of
Rs.10,00,000/ by cheque. Thereafter, on 3 rd December, 2014 the
defendant no. 2 requested the plaintiffs for a personal loan of Rs.
10,00,000/ which was advanced by the plaintiff by a cheque. Again
defendant no. 2 requested for a loan of Rs. 2,50,000/ which was given
by plaintiff. In the month of April, 2015 the defendant no. 2 approached
plaintiffs and represented that due to problem in accounting and
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SUMMONS FOR JUDGMENT 161/18 3
income tax, defendant no. 2 wanted to clear the loan amount from the
books of the defendant no. 1 and he repaid the amount of
Rs. 32,50,000/ by RTGS. Thereafter, as per the request of defendant
no. 2 plaintiff has transferred the amount of Rs. 32,50,000/ to the
personal account of defendant no. 2. On 15th April, 2015 defendant no.
2 drawn and signed two demand promissory notes in favour of plaintiffs
for the receipt of Rs.10,00,000/ and Rs. 32,50,000/.
4. It is further case of plaintiff that as defendants were not regular in
payment of interest, plaintiff demanded repayment of loan amount.
Defendant no.2 issued two cheques of Rs. 10,00,000/ and Rs.
32,50,000/ respectively which were dishonoured. Plaintiffs have issued
demand notice through their Advocate to defendants and defendants
replied to that notice denying their liability, hence this suit.
5. The defendants resisted this summons for judgment by filing
reply. They have stated that promissory notes are fabricated documents.
The rubber stamp on that documents are also bogus and manipulated.
The defendants have admitted that they have paid Rs. 10,00,000/ and
Rs. 32,50,000/ to the account of plaintiffs. Defendants have denied
about availing the loan from the plaintiffs. Defendants have stated that
defendant no. 2 had issued two undated cheques from his personal
account to the plaintiffs towards security purpose of defendant no. 1
liability. Defendant no. 2 have not written dates on cheques. Defendants
have paid principal amount and therefore there is no question of
making any payment to plaintiffs. Therefore, unconditional leave to
defend may be granted.
6. Plaintiff have resisted the averments of the reply of the
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SUMMONS FOR JUDGMENT 161/18 4
defendants by filing rejoinder and denied the contentions raised by the
defendants in their reply.
7. Heard Ld. Counsel for plaintiff and Ld. Counsel for defendants.
8. From the material on record following points come for my
determination and my findings with reasons are as follows:
POINTS FINDINGS
1.Whether the plaintiff is entitled for
summons for judgment?
No
2.Whether defendants are entitled for
leave to defend. If yes whether
conditional leave or unconditional?
Yes
with condition as stated in final
order
3.What order? As per final order
REASONS
AS TO POINT NO.1 TO 3
9. The Ld. Counsel for plaintiff has reiterated the case of the
plaintiff as set out in the plaint. He has further submitted that
defendants have stated that they have paid the due amount to the
plaintiffs, which means in other words defendants admits that they had
taken loan from the plaintiff of Rs, 10,00,000/ and of Rs. 32,50,000/.
The defendants have also agreed to pay the interest at the rate of 18%
on the said loan. Defendants have executed promissory notes. For some
period the defendants have paid the interest. But thereafter they were
not regular in payment of interest. Plaintiffs demanded the loan amount
back to which the defendants had issued two cheques. Both the cheques
were dishonoured. The plaintiffs have given demand notice to which
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SUMMONS FOR JUDGMENT 161/18 5
the defendants have filed their reply. In that reply the defendants have
not taken about the fabrication of promissory notes. Therefore, the
summons for judgment may be made absolute.
10. To support his arguments, the Ld. Counsel for plaintiff has relied
on copies of promissory notes, copies of dishonoured cheques, copies of
cheque return memos, copy of dishonoured cheque no. 304500 of Rs
4,15,350/, copies of demand notices, copy of reply given by advocate
of defendants and particular of claims. The Ld. Counsel also relied on
IDBI Trusteeship Services Ltd. V/s Hubtown Ltd., (2017) 1 SCC 568.
11. Per contra the Ld Counsel for defendants have strongly submitted
that plaintiff’s whole case is false. On the promissory notes the
signatures of defendant no. 2 are forged. The loan amount was repaid
by the defendants and therefore there was no question of any due
amount. The bank return memo states that “account blocked” but that
account of defendants is in operation till today and was never blocked.
This shows how the plaintiffs manipulated the documents against the
defendants. The promissory notes, cheques all are required to send to
handwriting expert to ascertain whether it bears signature of defendant
no. 2. Therefore, defendants be granted unconditional leave to defend.
12. To support her arguments, the Ld. Counsel had relied on copies of
promissory notes, Copy of bank account statement and letter of bank
about operation of bank account.
13. In rejoinder argument the Ld. Counsel for plaintiff has submitted
that in criminal case defendant no.2, who is accused thereon, has made
application for settlement, which means defendants have admitted their
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SUMMONS FOR JUDGMENT 161/18 6
liability. To support his argument, ld. Counsel had relied on the copy of
the application preferred by the defendant no.2 before the criminal
court.
14. This is a summary suit for recovery of Rs.62,36,100/ (Rupees
Sixty Two Lacs Thirty Six Thousand and One Hundred Only). The claim
of plaintiff is based on two promissory notes, cheque bearing No.
006715 of Rs. 32,50,000/ and cheque bearing No. 641514 of Rs.
10,00,000/. It is not disputed by the defendants that these two cheques
are not issued by defendants. The defendants claimed that those were
given as a security for the loan. Those cheques were dishonoured is also
undisputed fact. The defendants have received the notices of
dishonoured of cheques and they have also replied the same. The
argument of the ld. Counsel about the application by the defendant no.
2 in criminal case to settle the case has no force as from this conduct of
defendant no. 2 it cannot be said that defendants have admitted the
liability towards plaintiff.
15. It is a defence of the defendants that they have repaid the whole
loan amount and nothing is due to plaintiff. In this respect the
defendants have relied on the statement made by plaintiffs in the
paragraph no. 5 and 8 of the plaint that the sum of Rs. 10,00,000/ and
Rs. 32,50,000/was repaid to plaintiff by defendant no. 2. Such reliance
on the bits and pieces of the plaint is of no use because the plaint has to
read in whole. Defendants cannot pick up any sentence or paragraph of
the plaint in isolation. The copy of bank account statement of
defendants shows that amounts were paid to plaintiff from time to time,
but by making such payments defendants have repaid whole amount is
the issue which cannot be decided at this stage. The defendants have
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SUMMONS FOR JUDGMENT 161/18 7
raised objections about two promissory notes and also have taken
defence that two cheques were given as a security towards loan, these
are also triable issues.
16. In the case of IDBI Trusteeship Services Ltd Vs. Hubtown Ltd,
2017 1 SCC 568, the Hon’ble Supreme Court has laid down following
principles:
a. 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;
b. if the defendant raises triable issues indicating 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;
c. even if the defendant 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.
d. 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, 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.
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SUMMONS FOR JUDGMENT 161/18 8
e. 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;
f. 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.
17. Applying the above principles in the present case as defendants
have raised triable issues but they have admitted about taking loan from
the plaintiffs. Also presumption under section 118 of the Negotiable
Instruments Act, 1881, though rebutable are against the defendants. So
also the responsibility imposed by the section 30 of the Negotiable
Instruments Act, 1881 to pay compensation for dishonoured cheques
are prima facie on defendants. Therefore, though plaintiff is not entitled
to leave to sign judgment, but applying as per clause (c) of the above
principles laid down by the Hon’ble Supreme Court, the defendants are
entitled for leave to defend with condition of depositing Rs. 42,50,000/
in Court. Accordingly, the point No.1 is answered as 'No' and point No.2
is answered as 'Yes' with the condition of payment of Rs 42,50,000/ in
court and following order is passed.
ORDER
1. Summons for Judgment No.161/2018 stands rejected.
2. The defendants are granted leave to defend subject to condition
of depositing a sum of Rs. 42,50,000/ (Rupees Forty Two Lacs and
Fifty Thousand Only) in court within four weeks from the date of this
order.
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SUMMONS FOR JUDGMENT 161/18 9
3. After payment of sum of Rs. 42,50,000/ (Rupees Forty Two Lacs
and Fifty Thousand Only) as ordered, the Registrar of the court is
directed to take necessary steps to convert this suit from summary to
short cause.
4. On depositing the aforesaid sum of Rs. 42,50,000/ (Rupees Forty
Two Lacs and Fifty Thousand Only) as directed, Registrar is directed to
invest the said amount in any nationalized bank for initial period of one
year and renewable from time to time and to abide by further orders
that may be passed in the suit herein.
5. Summons for Judgment No.161/2018 is disposed of accordingly.
(M.S.LONE)
Judge,
Date: 30/08/2019 City Civil Court,Gr. Bombay
Dictated on : 30/08/2019
Transcribed on : 30/08/2019
Signed on : 30/08/2019
CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL SIGNED
JUDGMENT/ORDER.”
30/08/2019 at 5.20p.m. Mrs.J.V.Pawar
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
Name of the Judge (With Court Room No.) HHJ Shri.M.S.Lone
(C.R.NO.28)
Date of pronouncement of Judgment/Order 30/08/2019
Judgment/Order signed by P.O. on 30/08/2019
Judgment/Order uploaded on 30/08/2019
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