Interim Order 1

Order Details: Ex-parte Judgement
Pdf Text: 1 Summ. for Judg. No.69/2022
In Comm. Sum. Suit 46/2021
MHCC010020812022 Presented on : 1/3/2022
Registered on : 1/3/2022
Decided on :19/09/2022
Duration : Y/06M/18D
IN THE CITY CIVIL COURT AT MUMBAI.
SUMMONS FOR JUDGMENT No.69/2022
IN
COMMERCIAL SUMMARY SUIT NO.46/2021
Laherchand Lakhamsi Oswal
Age 80 years, occu. Business, R/o. B4,
Runwal Park, Sion Trombe Road,
Chembur, Mumbai 400 053 …PLAINTIFF
VERSUS
Mitesh Kanji Gadda
Age : adult, R/o. 201/202, 2nd floor,
Abhilasha, S.V.Road, Kandivali (W),
Mumbai 400 067 …DEFENDANT
Shri Laxman Kanal, learned Advocate for plaintiff
Shri Satish Agarwal, learned Advocate for defendant
CORAM : SHRI.N.P.TRIBHUWAN, ADHOC DISTRICT JUDGE
(C.R.NO.32)
J U D G M E N T
(Delivered on 19/09/2022)
Plaintiff has filed this Summons for Judgement under
Order XXXVII of CPC for claim of Rs.10,00,000/ with interest @ 18%
p.a. from the date of suit till realization of entire amount.
2] It is case of plaintiff that defendant is his friend since long.
In October 2009 defendant was in need of money for some urgent
work. In view of friendly relations with defendant plaintiff give him a
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In Comm. Sum. Suit 46/2021
friendly loan of Rs.10,00,000/ on 7/10/2009 through cheque. At that
time defendant assured to repay the same within a period of 90 days.
He also executed promissory note in favour of plaintiff to repay the said
loan amount. However, he failed to repay the same within 90 days.
Inspite of several requests he failed to repay the said loan amount. The
said act of defendant prima facie shows that he never had an intention
of repay the said amount. Therefore, plaintiff has issued him notice
dt.15/12/2018 and called upon to repay the said amount. Inspite of
service of notice he has not paid the said amount. Hence, plaintiff has
filed this suit.
3] Plaintiff contended in summons for judgement that
defendant has no defence and is liable to pay the said amount. Hence,
leave to defend may not be granted.
4] Defendant has filed reply and contended that suit is
baseless, frivolus and has been formulated on wrong and misleading
averments. Plaintiff is carrying on the business of money lending
without obtaining requisite license under the Maharashtra Money
Lending (Regulation) Act, 2014. Plaintiff failed to prove any legally
enforceable and recoverable debt or liability against defendant. Plaintiff
has sent him notice dt.15/12/2018 against purported promissory note
dt.7/10/2009 which was valid for a period of 3 years as per law. Under
section 4 of the N.I. Act, a promissory note is valid only for the term of
three years. The demand against purported promissory note made after
a lapse of 9 years. Therefore, claim of plaintiff is illegal. Moreover, in
case of a friendly loan, no promissory note can be insisted on from the
borrower. No interest is chargeable on friendly loan. Defendant has
repaid the loan amount in cash within period of 90 days as agreed and
the plaintiff had issued receipt thereof in November/December 2009.
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In Comm. Sum. Suit 46/2021
Defendant was supposed to preserve the document only for a period of
8 years under Income Tax Act, Companies Act 2013 and GST Act.
Therefore, defendant does not possess the said receipt. In order to
extort money, the plaintiff has afterthought filed this suit on basis of
expired document i.e. promissory note. Under the facts and
circumstances the defendant has plausible defense to defend the suit
and plaintiff is to be subjected to cross examination during trial. Hence,
defendant prayed for leave to defend the suit.
5] Considering the contentions in plaint and defence raised by
the defendant, following points arise for determination of this court and
recorded findings thereon for the reasons stated as under.
POINTS FINDINGS
1. Whether defendant is entitled for leave to
defend the suit? ...Yes.
2. What order? ...As per final
order.
REASONS
As to point Nos.1 and 2 :
6] Heard counsel of both the parties. Learned counsel of
defendant relied on following case law:
Smt. Ashwini Satish Bhat vs. Shri Jeevan Divakar Lolienkar :
2000 (5) Bom CR 9,
Para 6. The ruling upon which reliance has been placed by the
learned advocate for the respondent is applicable on all fours. In
that case loan was advanced in the year 1985 and the cheque was
issued in the year 1990.
By the time the cheque was issued, the debt was barred by
limitation because no acknowledgement was obtained before the
expiry of 3 years from the date of loan. In these circumstances, it
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In Comm. Sum. Suit 46/2021
was held there that the debt was not legally enforceable at the
time of issuance of cheque and the accused could not be punished
under section 138 of the said Act. In the light of Explanation to
the said section, it was further held therein that in case a cheque
is issued for time barred debt and it is dishonoured, the accused
cannot be convicted under section 138 on the ground that the
said debt was not legally recoverable.
7] Recently, Hon’ble Supreme Court in case law of B.L.
Kashyap and Sons Ltd. Vs. M/s. JMS Steels and Power Corporation
and Anr. : (2022) 3 SCC 294, held that
It would not be a correct approach to proceed as if denying leave
is the rule or that leave to defend is to be granted only in
exceptional cases or only in cases where defence would appear to
be meritorious one. On the issue of raising of triable issues, if
defendant indicates that he has a fair or reasonable defence, he is
ordinarily entitled to unconditional leave to defend unless there
be any strong reason to deny leave.
Even if there remains a reasonable doubt about probability of
defence, sterner or higher conditions could be imposed while
granting leave to defend but, denying leave would be ordinarily
countenanced only in such cases where defendant fails to show
any genuine triable issue and court finds defence(s) to be
frivolous or vexatious.
8] In the present case it is the case of plaintiff that on
7/10/2009 he has advanced friendly loan of Rs.10,00,000/ to
defendant but he has not repaid the same within 90 days as agreed.
According to defendant he has repaid the same within 90 days and at
that time plaintiff has issued receipt thereof but defendant does not
possess the said receipt because he was supposed to preserve the
document only for a period of 8 years under Income Tax Act,
Companies Act 2013 and GST Act.
9] Article 35 of the Limitation Act provides that the period of
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In Comm. Sum. Suit 46/2021
limitation for a suit based on promissory note payable on demand and
not accompanied by any writing restraining or postponing the right to
sue is three years from the date of the promissory note. It is not the case
of the plaintiff that any simultaneous agreement postponing the right to
sue was also entered into between the parties. In the absence of any
such agreement, the suit for recovery of amount mentioned in the
promissory note dated 7/10/2009 ought to have been filed within three
years from the date of promissory note, i.e. up till 6/10/2012. Thus,
prima facie it seems that plaintiff has filed the suit beyond the
prescribed period of limitation.
10] Plaintiff has advanced friendly loan and he has no money
lending license and hence, it is to be determined whether suit is barred
by the provisions of the Maharashtra Money Lenders Regulations Act.
As contended in para supra prima facie suit is time barred. Thus, this
issue requires to be tested on evidence. According to defendant he has
repaid the said amount within 90 days and at that time plaintiff has
issued receipt thereof but defendant does not possess the said receipt
because he was supposed to preserve the document only for a period of
8 years under Income Tax Act, Companies Act 2013 and GST Act.
Therefore, this issue is required to be tested on evidence. Further it is
doubtful whether friendly loan is within the definition of “Commercial
Dispute” under Section 2(1)(c) of the Commercial Court Act. Thus,
there are above triable issues raised by defendant.
11] In view of the above facts and case laws, I come to the
conclusion that defendant is entitled for unconditional leave to defend
the suit. It would be justified to allow defendant to defend the suit.
Hence, I answer point No.1 in the affirmative. Hence, I pass following
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In Comm. Sum. Suit 46/2021
order.
ORDER
1. A summons for judgment No.69 of 2022 is disposed of as
under.
2. Leave to defend the suit is granted to defendant and he
shall file written statement within 30 days from the date of this
order.
Date :19/09/2022.
(N.P. TRIBHUWAN)
Judge, City Civil Court, Mumbai.
(C.R.No.32)
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In Comm. Sum. Suit 46/2021
Dictated on : 19/09/2022.
Checked on : 19/09/2022.
Signed on : 19/09/2022.
CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
19/09/2022. Mrs.Rupali S. Bhor
UPLOAD DATE AND TIME NAME OF STENOGRAPHER
Name of the Judge(with CR
No.)
HHJ SHRI. N. P. TRIBHUVAN
(C.R.No.32)
Date of pronouncement of Order 19/09/2022.
Order signed by P.O. on 19/09/2022.
Order uploaded on 19/09/2022.
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