Final Order 1

Order Details: Copy of Judgment
Pdf Text: 1
MHCC010099142019
Presented on : 26092019
Registered on : 22112019
Decided on : 17032021
Duration : Y01 M5 D21
IN THE COURT OF SESSIONS FOR GREATER BOMBAY
COMMERCIAL SUIT NO.197 OF 2019
Gaurishankar Ramchandra Gupta ]
An Adult 47 years, Occ: Cloth Shop, ]
Indian Inhabitant of Mumbai, Residing at ]
Room No.3/317, Siddhi Sadhan ]
Building, Elphinstone Fitwala Road, ]
Mumbai400 013, Mob 9324456213 ].....Plaintiff
V/s
Rohit Dayashankar Tiwari ]
Age: Not known, An Adult, Occ: Taxi Business ]
Indian Inhabitant of Mumbai, Residing at ]
Room No.5, Fitwala Building No.4, Fitwala Road, ]
Elphinestone Road, Fitwala Road, Mumbai400013]. ..Defendant
APPEARANCE:
Ld. Adv. Mr. Santosh Thakur for plaintiff.
Ld.Adv. Mr. Rajesh M. Yadav for defendant.
CORAM : HIS HONOUR ADDL.SESSIONS
JUDGE SHRI. SANJAY N. YADAV
(C.R.No.32).
DATED : 17th March, 2021.
Claim : Suit for recovery of Money.
-- 1 of 14 --
2
JUDGMENT
(Dictated in Open Court)
The plaintiff by this suit seeks recovery of amount of
Rs.5,08,600/(Rupees Five Lakhs Eight Thousand Six Hundred Only)
from the defendant being the principal amount with interest till
23.04.2019 and further prayed for interest at the rate of 6% per annum
on principal amount of Rs.3,60,000/(Rupees Three Lakhs Sixty
Thousand Only) from the date of filing of suit till its realization.
2. The facts giving rise to the suit in short can be stated as
follows:
It is the case of the plaintiff that he knew the defendant
through the father of defendant Dayashankar Tiwari. The defendant
approached the plaintiff and sought friendly loan of Rs.3,60,000/ for
expansion of his Taxi Business. The defendant accordingly executed a
Simple Mortgage Deed dated 03.06.2016 thereby admitting his liability
to pay the amount of Rs.3,60,000/. The defendant undertook to pay
the amount in 11 (Eleven) months from date of execution of mortgage
deed. The defendant agreed on failure to repay the loan amount within
the stipulated period, the defendant will pay the interest of 21% p.a.
from the date of default till recovery of amount. It is the contention of
the plaintiff that the defendant had also executed a Promissory Note for
Rs.3,60,000/.
3. It is alleged that defendant had mortgaged his residential
premises i.e. Room No.5, Fitwala Building No.4, Fitwala Road,
Elphinestone Road, Delisle Road, Mumbai400013. The plaintiff pleads
that the defendant admitted that he had agreed the right of lien on the
-- 2 of 14 --
3
said premises on failure to pay the loan amount. It is alleged that the
defendant had failed to return the amount and on contrary he had
lodged false report with the police. The plaintiff had issued notice on
13.03.2019 to the defendant and called upon him to pay the loan
amount with interest. Inspite of the notice the amount is not paid by
the defendant.
The plaintiff, therefore, had filed the present suit for
recovery of amount of Rs.5,08,600/from the defendant being the
principal amount with interest till 23.04.2019 and further prays for
interest at the rate of 6% per annum on principal amount of
Rs.3,60,000/ from the date of filing of suit till its realization.
4. The defendant had appeared in the suit and filed written
statement at Exh.5. It is contended that the suit is false, frivolous and
vexatious. It is stated that suit is not maintainable as there is no cause
of action for the suit. It is contended that the plaintiff had not
approached the Court with clean hands. It is stated that this Court has
no jurisdiction to entertain the suit. It is stated that the signatures on
the Mortgage Deed are forged. It is stated that the plaintiff is in illegal
business of money lending. The defendant denied that he had taken
loan amount of Rs.05,08,600/. It is also denied that the defendant had
executed a Simple Mortgage Deed on 03.06.2016.
It is contended that plaintiff is not entitled for recovery of
amount of Rs.5,08,600/from the defendant being the principal amount
with interest till 23.04.2019 and further for interest at the rate of 6%
per annum on principal amount of Rs.3,60,000/ from the date of filing
of suit till its realization. The defendant prayed for dismissal of the suit.
-- 3 of 14 --
4
5. The following issues were framed at Exh.6 by the Ld.
Predecessor Shri. Milind A. Bhosale, Judge, City Civil Court, Gr.
Bombay. I have proceed to answer the same with my findings/decisions
and the reasons as follows :
SR.
NO. ISSUES DECISIONS
1 Whether the plaintiff proves that he had
given friendly loan amount of
Rs.3,60,000/ to the defendant?
In Affirmative
2 Whether the plaintiff proves that the
defendant had executed mortgage deed
in favour of plaintiff?
In Affirmative
3 Whether the defendant proves that the
plaintiff has filed suit against defendant
by making false mortgage deed by
marking forged signature of defendant?
In the Negative
4 Whether defendant proves that the
plaintiff is running money lending
business?
In the Negative
5 Is the suit in limitation? In Affirmative
6 Is the plaintiff is entitled to recover
amount of Rs.3,60,000/ with interest
@6% p.a.?
In Affirmative
7 What order ? As per final order below
REASONS
As to issue Nos. 1 and 4:
6. Heard learned Advocate Mr. Santosh Thakur for plaintiff
and learned Advocate Mr. Rajesh M. Yadav for defendant.
7. The learned Advocate for the plaintiff argued that the suit
is filed on the basis of Deed of Equitable Mortgage and Promissory Note
dated 03.06.2016 for amount of Rs.3,60,000/. The amount was to be
paid in 11 months. On failure to repay the loan amount by the
-- 4 of 14 --
5
defendant the interest at the rate of 21% p.a. was to be charged. The
amount was not repaid by the defendant, on the contrary the defendant
had lodged false report with the police. The defendant had neglected to
pay the amount. Inspite of notice through the Advocate of plaintiff, the
defendant had not paid the loan amount. Therefore, the plaintiff is
entitled for recovery Rs.05,08,600/ from the defendant being the
principal amount with interest till 23.04.2019 and further interest at the
rate of 6% per annum on principal amount of Rs.3,60,000/ from the
date of filing of suit till its realization.
8. The defendant on the other hand had contended that the
suit of plaintiff is false and is instituted without any cause of action.
The defendant had not obtained any loan from the plaintiff. It is stated
that the alleged signatures of the defendant on the Mortgage Deed
dated 03.06.2016 are false. It is stated that suit is not maintainable as
the suit is beyond limitation and this Court has no jurisdiction to
entertain the suit.
9. It would be appropriate to look into the evidence of the
plaintiff that the plaintiff in support of his case had examined himself as
PW No.1 Gaurishankar Ramchandra Gupta at Exh.07. The witness for
the plaintiff had reiterated all the contentions raised by the plaintiff in
the plaint. The plaintiff had relied upon following documents (Exh.08):
Sr.
No.
Particulars Exh.
1 Original Simple Mortgage Deed dated 03.06.2016
executed between the plaintiff and the defendant.
10
2 Original Promissory Note dated 03.06.2016 executed
by the defendant in favour of the plaintiff.
11
3 Original receipt for payment dated 16.10.2018 along 9 (A)
-- 5 of 14 --
6
with original acknowledged application dated
16.10.2018, under Right to Information Act,2005,
filed by the plaintiff before the office of
Commissioner of Police, Worli Division, Mumbai
while taking the information under Right to
Information Act,2005.
colly
4 Original covering letter dated 22.10.2018, bearing
Outward No.1241 alongwith certified copy of
complaint dated falsely lodged by the defendant with
the Asst. Commissioner of Police, Worli Division,
Mumbai.
9
5 Original office copy of mandatory notice dated
13.03.2019
12
6 Original postal dispatch receipt dated 13.03.2019 in
respect of dispatched of notice dated 13.03.2019
issued by the postal authority.
13
7 Original acknowledgement card in respect of dispatch
of demand notice dated 13.03.2019 to the defendant
from Town Hall Post Office, Mumbai.
14
10. It is the evidence of the plaintiff that amount of
Rs.3,60,000/ was advanced on 03.06.2016 and the defendant had
executed Simple Mortgage Deed dated 03.06.2016 (Exh.10) in the
presence of two witnesses PW No.2 Ashokkumar R. Pasi (Exh.15) and
PW No.3 Lal Kapildeo Singh (Exh.16) and Promissory Note dated
03.06.2016 (Exh.11).
Pausing for while, it needs to be mentioned that the suit is
for recovery of amount of Rs.5,08,600/from the defendant being the
principal amount with interest till 23.04.2019 and further interest at the
rate of 6% per annum on principal amount of Rs.3,60,000/. There is
no prayer clause in the prayer of the plaintiff based on Mortgage Deed.
No prayer was made by the plaintiff in the plaint that on default in
making the payment of the amount, it will be presumed that the
defendant had relinquished and surrendered his tenancy right in favour
-- 6 of 14 --
7
of the plaintiff relating to Room No.5, Fitwala Building No.4, Fitwala
Road, Elphinestone Road, Delisle Road, Mumbai400 013 and the
defendant had no objection that the landlord of the said property
transfers the rent bill in the name of the Mortgagee i.e. plaintiff.
Though, there are pleadings regarding Mortgage Deed, nothing is
claimed in the suit by any prayer. The rights attributing on the basis of
mortgage deed. The evidence of the plaintiff shows that the defendant
Rohit Tiwari had executed Promissory Note (Exh.11),it also shows that
he had received amount of Rs.3,60,000/ from the plaintiff.
11. The defendant had examined himself as DW No.1 Rohit
Dayashankar Tiwari at Exh.18. He had reiterated all the contentions
raised by him in the written statement. It is contended that plaintiff is
running illegal business of money lending. It is stated that he has no
relations with the plaintiff and no amount is due towards the plaintiff.
The crossexamination of PW No.1 Gaurishankar Gupta by
the defendant needs to be considered. The suggestion was put in the
crossexamination of PW No.1 Gaurishankar Gupta that the promissory
note in the name of defendant is false. No suggestion was put to
witness that signatures on the promissory note Exh.11 is not of the
defendant.
The defendant also does not dispute his signature on
Mortgage Deed Exh.10.
The defendant in his evidence had denied the loan
transaction. It is the allegation of the plaintiff that the false report is
filed by the defendant with police on 22.08.2016 (Exh.19). The copy of
the report was obtained by the plaintiff under Right to Information Act,
2005. The defendant had not raised any questions about the report
lodged by him to the police in the crossexamination of PW No.1
-- 7 of 14 --
8
Gaurishankar Gupta.
It would be worth to look into the contentions of the
defendant in the report made with police. It is alleged that in the report
(Exh.19) of the defendant he had obtained loan from Vishal Patil,
Ganesh Kalvar, Pravin Katariya etc. The defendant in the FIR Exh.19
alleged that he had taken Rs.3,50,000/ for construing residential
premises at his native place from Gaurishankar Gupta, the plaintiff. As
Gaurishankar Gupta was demanding money time and again, he had sold
the land of his brotherinlaw and paid amount to Gaurishankar Gupta.
The fact about the payment of money to the plaintiff has not been
contended by the defendant in the written statement nor had put any
suggestion to the plaintiff in the crossexamination by the plaintiff. The
defendant was crossexamined by the plaintiff, to a suggestion, it was
answered by the defendant that he had not filed any documents to
show that he had sold land of his brotherinlaw of his native place and
had given an amount to the plaintiff. The defendant in the report with
police had admitted that he owed Rs.3,50,000/ to the plaintiff.
12. The execution of promissory note is proved by the plaintiff.
The defendant had admitted about the borrowing of amount in the
police report (Exh.19) the amount of Rs.3,50,000/ was alleged to be
repaid by him by selling land of his brotherinlaw. The defendant also
admitted that there is no witness to the repayment of the amount to the
plaintiff by him. He also admitted that he had not taken receipt from
the plaintiff when he had made the payment.
13. So far as the issue regarding the execution of Mortgage
Deed dated 03.06.2016 is concerned, there are no prayers in the suit in
respect of rights created in favour of the plaintiff by alleged Mortgage
-- 8 of 14 --
9
Deed. The plaintiff by his evidence and evidence of PW No.2
Ashokkumar R. Pasi (Exh.15) and PW No.3 Lal Kapildeo Singh
(Exh.16) had proved the execution of Mortgage Deed. It also needs to
be mentioned that residential premises, Room No.5, Fitwala Building
No.4, Fitwala Road, Elphinestone Road, Delisle Road, Mumbai400 013
is not mentioned in paragraph No.3 of the Mortgage Deed. The
Mortgage Deed does not create any right in favour of the plaintiff in
respect of the Room No.5, Fitwala Building No.4, Fitwala Road,
Elphinestone Road, Delisle Road, Mumbai400 013 in the claim. There
is nothing to indicate that signature on the Mortgage Deed are false.
The defendant at any point of time in the suit had not sought to refer
the documents to the handwriting expert. The defendant had failed to
show that his signatures on the Mortgage Deed are forged.
14. It is the contention of the defendant that the plaintiff is in
business of money lending. It was for the defendant to prove that the
plaintiff is in business of money lending by bringing evidence that the
plaintiff had lend money to many persons.
15. It would be appropriate to refer the Judgment of the
Hon'ble Bombay High Court, Ordinary Original Civil Jurisdiction in
its Commercial Division, Summons for Judgment (Lodg.) No.91 of
2019 in Commercial Summary Suit (Lodg.) No.1131 of 2019
alongwith Interim Application No. 1 of 2019, in paragraph No.28 it
had observed as follows:
28. A profitable reference in this context can be made to a
judgment of this Court in the case of Base Industries Groups & Anr.
Vs. Mahesh P. Raheja & Ors.,2019(3) ALL M.R.571 wherein the
learned Single Judge traced the pronouncements on the transactions
-- 9 of 14 --
10
which fall within the mischief of money lending and culled out the legal
propositions in the following words:
“36. From this discussion, the following propositions
emerge:
(a) Not every loan is axiomatically a moneylending
transaction for the purposes of the 1946 or the 2014 Acts. There is no
such presumption in law.
(b) It is doing of the 'business of moneylending' that attracts
the provisions of the statute. In interpreting the phrase, the correct
emphasis is on the word 'business', not 'moneylending'. It is the word
'business', and not the expression 'moneylending', that is determinative.
Simply put, every instance of lending money is not moneylending. Not
every lender is a Shylock.
(c) To constitute 'business', a single isolated instance does not,
and even several isolated stray instances do not, constitute 'the business of
moneylending'. To be engaged in the 'business of moneylending', the
activity must be systematic, regular, repetitive, and continuous, and must
generate an appreciable revenue. The fact that the borrower is a stranger
to the lender does not on its own make the latter a 'moneylender'.
(d) A loan recovery action is not barred merely because there
is a loan. It has to be shown that the loan was part of 'the business of
moneylending'.
(e) A plaintiff seeking a recovery of a loan is not required to
show that his suit is not barred by the Money Lenders Act. It is always for
the defendant who puts up moneylending as a defence to show that the
transaction is forbidden by the Money Lenders Act.”
16. In the light of judgment of the Hon'ble Bombay High Court
in the case of Base Industries Groups & Anr. Vs. Mahesh P. Raheja &
Ors.,2019(3) ALL M.R.571 it becomes clear that not every loan is
axiomatically a moneylending transaction for the purposes of the 1946
or the 2014 Acts. There is no such presumption in law. It is doing of
the 'business of moneylending' that attracts the provisions of the
statute. In interpreting the phrase, the correct emphasis is on the word
-- 10 of 14 --
11
'business', not 'moneylending'. It is the word 'business', and not the
expression 'moneylending', that is determinative. Simply put, every
instance of lending money is not moneylending. Not every lender is a
Shylock. To constitute 'business', a single isolated instance does not,
and even several isolated stray instances do not, constitute 'the business
of moneylending'. To be engaged in the 'business of moneylending',
the activity must be systematic, regular, repetitive, and continuous, and
must generate an appreciable revenue. The fact that the borrower is a
stranger to the lender does not on its own make the latter a 'money
lender'. A loan recovery action is not barred merely because there is a
loan. It has to be shown that the loan was part of 'the business of
moneylending'. A plaintiff seeking a recovery of a loan is not required
to show that his suit is not barred by the Money Lenders Act. It is
always for the defendant who puts up moneylending as a defence to
show that the transaction is forbidden by the Money Lenders Act.”
17. The defendant has failed to prove that activity must be
systematic, regular, repetitive, and continuous, and must generate an
appreciable revenue. In the absence of evidence that the plaintiff is
engaged in the business of money lending. The issue No.4 has to be
answered in the negative”.
I proceed to answer issue Nos. 1 to 4 as follows:
(i) Issue No.1 is answered “in affirmative”.
(ii) Issue No.2 is answered “in affirmative”.
(iii) Issue No.3 is answered “in the negative”.
(iv) Issue No.4 is answered “in the negative”.
As to Issue No.5:
18. It was for the defendant to show that the suit is not within
-- 11 of 14 --
12
limitation. The defendant had not brought any evidence to show that
as to how suit is beyond period of limitation. The defendant had
executed the promissory note dated 03.06.2016. The suit is filed on
23.06.2019 i.e. within three years. The suit is not beyond limitation. It
is within period of limitation.
I answered issue No.5 “in affirmative”.
As to Issue No.6:
19. The plaintiff had sought recovery of amount of
Rs.5,08,600/ from the defendant being the principal amount with
interest till 23.04.2019 and further prayed for interest at the rate of 6%
per annum on principal amount of Rs.3,60,000/ from the date of filing
of suit till its realization.
It is not in dispute that the defendant had obtained loan of
amount of Rs.3,60,000/ from the plaintiff on 03.06.2016. It is the
contention of the plaintiff that amount was to be returned within 11
months and on failure to return amount, the interest at the rate of 21%
per annum was to be charged on the basis of Mortgage Deed. It is now
required to see as to whether the plaintiff is entitled with interest at the
rate of 21% p.a. The plaintiff had relied upon Mortgage Deed Exh.10.
The clause No.2 of the Mortgage Deed shows that defendant was to be
paid the amount within 11 months. It further points out that on failure
to pay, the defendant was required to pay the interest at the rate of
21% p.a. from the date of deposit.
The plaintiff in his evidence had contended that in the
notice dated 13.03.2019, he had called upon the defendant to repay the
amount with interest at the rate of 18% p.a. In paragraph No.11 of the
plaintiff's evidence it is contended that the is entitled to recovery an
amount of Rs.3,60,000/ with interest at the rate of 18% p.a. There are
-- 12 of 14 --
13
no pleadings in the plaint for the basis to claim interest at the rate of
21% p.a. as stated in Mortgage Deed and the interest at the rate of 18%.
In the prayer of clause of the suit, the plaintiff has claimed the interest
at the rate of 6% p.a. It appears that the plaintiff himself is not sure
about the agreed rate of interest between the plaintiff and defendant.
Considering the prayer of the plaintiff, he had claimed the
interest at the rate of 6% p.a. from the date of suit till its realization. It
would be appropriate to direct the defendant to pay to the plaintiff a
sum of Rs.3,60,000/ with interest of 6% per annum after 11 months
from 03.06.2016 till the date of filing of suit. The defendant is further
directed to pay to the plaintiff the interest at the rate of 6% per annum
on principal amount of Rs.3,60,000/ from the date of suit till its
realization. The issue No.6 is answered “in affirmative”.
In the result, following order is passed.
ORDER
1. The Suit is decreed with costs.
2. The defendant is directed to pay to the plaintiff a sum of
Rs.3,60,000/(Rupees Three Lakhs Sixty Thousand Only) with
interest of 6% per annum after 11 months from 03.06.2016 till the
date of filing of suit. The defendant is further directed to pay to the
plaintiff the interest at the rate of 6% per annum on principal
amount of Rs.3,60,000/ from the date of suit till its realization.
3. Decree be drawn up accordingly.
(SANJAY N. YADAV)
Additional Sessions Judge
Date: 17.03.2021 Gr.Bombay at Mumbai.
Dictated on : 17.03.2021
Transcribed on : 19.03.21 & 22.03.2021
Signed by H.H.J.on : 06.04.2021
-- 13 of 14 --
14
“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
07.04.2021 at 4.10 p.m.
UPLOAD DATE AND TIME
(Mrs. K.S.Bhosale)
NAME OF STENOGRAPHER
Name of the Judge HHJ SHRI S.N.Yadav
(COURT ROOM NO.32)
Date of pronouncement of
judgment/order
17.03.2021
Judgment/order signed by P.O. on 06.04.2021
Judgment/order uploaded on 07.04.2021
-- 14 of 14 --