Interim Order 1

Order Details: Other
Pdf Text: IN THE COURT OF SESSIONS FOR GR. BOMBAY AT MUMBAI
SUMMARY JUDGMENT NO. 05 OF 2020
IN
COMMERCIAL SUIT NO. 250 OF 2019
(CNR No.MHCC010119762019)
M/s. Oscar Fashion Pvt. Ltd. ]
A Co. incorporated under the Companies Act, ]
Carrying on its business at office Unit No.101, ]
01st floor, Safalya Building, B. Parulekar Marg, ]
Off Bhavani Shankar Road, Dadar (West), ]
Mumbai400 028, ]
Through its Director Mr. Sharad Ratanshi Pasad ]
Aged about 59 years, Occ: Business ]..Plaintiff
V/s
Mr. Bharat Shivaji Udeshi ]
Aged about 68 years, Occ: Business, ]
having address at Dolat Manzil, 01st floor, ]
Next to Parsee Gymkhana, 607A, ]
Dr. B. Ambedkar Road, Dadar (E), ]...Defendant
APPEARANCE:
Ld. Adv. Paras Vira for plaintiff.
Ld. Adv. Rajesh Ghagh for defendant.
CORAM : HIS HONOUR ADDL.SESSIONS
JUDGE SHRI. SANJAY N. YADAV
(C.R.No.32).
DATED : 23th February, 2021.
SUMMARY JUDGMENT
(Dictated in Open Court)
The plaintiff by this application seeks summary judgment in
accordance with Order XIIIA of the Code of Civil Procedure, 1908.
2. The facts giving rise to the suit in short can be narrated as
follows:
Pursuant to the requests of the defendant, the plaintiff
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company had given a loan of Rs.5,00,000/ (Rupees Five Lacs Only) to
the defendant on 15.11.2017. The amount was transferred by RTGS
and debited from the account plaintiff held by it in Carana Bank, Shivaji
Park, Dadar (West). The transaction was certified by the bankers vide
certificate dated 29.08.2018.
3. The defendant had executed a writing in favour of the
plaintiff and acknowledged the receipt of the amount of loan, towards
the discharge of the liability towards repayment of the said loan
amount. The defendant had issued cheque for Rs.5,35,000/ on
01.03.2018 in favour of the plaintiff.
The cheque issued by the defendant was dishonoured on its
deposit. It is the contention of the plaintiff that inspite of reminder, the
defendant had not paid loan amount. The plaintiff, therefore, had
issued notice on 17.04.2018 to the defendant. The defendant had
replied the notice on 05.05.2018 and denied the contentions of the
plaintiff. It is contended that transaction of advancement of loan was a
professional money lending transaction. The plaintiff, therefore, had
prayed for judgment and decree against the defendant for amount of
Rs.6,95,500/ with interest at the rate of 18% p.a. or such other rate as
this Court may deem fit and proper on Rs.5,35,000=00/ from the date
of filing of the suit till its realization.
4. The defendant denied the contentions in the application for
summary judgment under Order XIIIA of the Code of Civil Procedure. It
is submitted by the defendant in the written statement that the
defendant had denied all the contentions raised by the plaintiff in the
plaint. It is submitted that defendant denies each and every statement
averments, allegations made by the plaintiff in the plaint. It is
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submitted that application is not maintainable and liable to be rejected.
It is the contention of the defendant that dispute between
the plaintiff and defendant is not commercial and is not maintainable as
commercial suit. It is submitted that the plaintiff in the cross
examination in the Complaint bearing No.1362/SS/2018, the plaintiff
was crossexamined and the plaintiff had admitted that it had no Money
Lending Lincense under the Maharashtra Money Lenders Act.
It is contended that the transaction of the plaintiff is illegal,
unauthorized and ab initio void. It is stated that claim of the plaintiff is
not maintainable in the light of provisions of Section 13(1) of
Maharashtra Money Lenders Regulation Act, 2014. It is stated that the
defendant did not have valid license as money lender at the time of
lending money to the defendant. It is contended that oral evidence of
the parties is necessary so as to solve the controversy involved in the
suit. It is stated that ground raised by the defendant go to the root of
the suit and to the jurisdiction of this court to entertain and adjudicate
to the present suit. It is contended that plaintiff is not entitled for
summary judgment. It is submitted that the summary judgment be
dismissed.
5. The following points arise for my determination with my
findings thereon and the reasons to follow :
SR.
NO. POINTS FINDINGS
1 Whether the plaintiff is entitled for
summary judgment for amount of
Rs.6,95,500/ with interest at the rate of
18% p.a. or such other rate as this Court
may deem fit and proper on
Rs.5,35,000/ from the date of filing of
the suit till its realization?
'In the Negative”
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2 What order and decree? As per final order below.
REASONS
AS TO POINT NO. 1:
6. Heard learned Advocate Paras Vira for the plaintiff and
learned Advocate Rajesh Ghagh for the defendant.
7. The Advocate for the plaintiff submitted that on
15.11.2017, the amount of Rs.5,00,000/ was given as loan to the
defendant. The amount was transferred by RTGS. The plaintiff has
produced the certificate of bankers. The defendant had executed a
writing in favour of the plaintiff. Lastly, the cheque presented to the
bank was not honoured. The defendant had failed to repay the amount.
The plaintiff, therefore, had issued notice on 17.04.2018 to the
defendant, calling upon the defendant to repay the amount received as
a loan.
8. It is submitted by the plaintiff that defendant has
undertaken to repay the loan amount to the plaintiff. The learned
Advocate argued that it is his liability to repay the amount. The
plaintiff is entitled for summary judgment on the admission of the
defendant. The learned Advocate argued that amount of Rs.5,35,000/
was advanced against cheque and the suit is filed on the basis of
dishonoured cheque. It is stated that in the light of Section 2(i)(f) of
the Negotiable Instruments Act, 1881, the provisions of Bombay Money
Lenders Act are not attracted to the present suit. It is stated that
plaintiff is entitled for judgment and decree.
9. The plaintiff had relied upon following judgments:
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i) Ganesh Madhavrao Hawaldar Vs. Mithalal Keshaolal
Dave, Bombay Money Lenders Act, 1946, Section 2(10)
ii) Gajanan & Ors. Vs. Seth Brindaban, AIR 1970 Supreme
Court 2007 (v 57 C)
10. The defendant denied the contentions in the application for
summary judgment under Order XIIIA of the Code of Civil Procedure. It
is submitted by the Advocate for the defendant that defendant in the
written statement had denied all the contentions raised by the plaintiff
in the plaint. It is submitted that defendant denies each and every
statement averments, allegations made by the plaintiff in the plaint.
It is the contention of the defendant that dispute between
the plaintiff and defendant is not commercial and is not maintainable as
commercial suit. It is submitted that the plaintiff in the cross
examination in the Complaint bearing No.1362/SS/2018, the plaintiff
was crossexamined and the plaintiff had admitted that it had no Money
Lending Lincense under the Maharashtra Money Lenders Act.
It is submitted that the transaction of the plaintiff is illegal,
unauthorized and ab initio void. It is stated that claim of the plaintiff is
not maintainable in the light of provisions of Section 13(1) of
Maharashtra Money Lenders Regulation Act, 2014. It is stated that the
defendant did not have valid license as money lender at the time of
lending money to the defendant. It is submitted that oral evidence of
the parties is necessary so as to solve the controversy involved in the
suit. It is stated that ground raised by the defendant go to the root of
the suit and to the jurisdiction of this court to entertain and adjudicate
to the present suit. It is contended that plaintiff is not entitled for
summary judgment. It is submitted that the summary judgment be
dismissed.
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11. The defendant had relied upon following judgments:
i) Jwaladutta Jankidas Huf Vs. Jayant Bhavanji
Soni And Anr. Bombay High Court Order dated
20.03.2020 in the case of Summons For Judgment
(Lodg.) No.91/2019 in Commercial Summary Suit
(Lodg.) NO. 1131/2019.
ii) Yallava Nagappa Kunchikorve Vs. Kantabai
Malli (2012) Bombay High CourtOrder dated
7.3.2012 in case of Summons For Judgment (Lodg.)
No.91/2019 in Commercial Summary Suit (Lodg.)
NO. 1131/2019
iii) Smt. Nanda D. Nandanwar, Timki Nagpur Vs.
Nandkishor N. Thaokar, Bombay High CourtOrder
dated 12.01.2010 in case of Criminal Appeal No.
467/2009
iv. Motilal Prabhulalji Vyas Vs. Jayantilal Tulsidas
Thanawala, Laws (BOM)20088119, High Court of
Bombay dated 14.08.2008
12. Going by the contentions of the plaintiff and defendant in
the plaint and the contentions of the defendant raised in the written
statement, the defendant does not dispute the receipt of amount of
Rs.5,00,000/ on 15.11.2017 by the defendant. The defendant also
does not dispute that the amount was debited from the account of the
plaintiff in Canara Bank. The defendant also had executed the writings
and also had issued cheque. The cheque issued by the defendant was
deposited with the bankers by the plaintiff and the same was
dishonoured. It is not in dispute that plaintiff had initiated proceeding
under Section 138 of Negotiable Instruments Act.
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13. It is the contention of the plaintiff that there is no material
on record to indicate that the plaintiff had lent money to the defendant
as its business. It is submitted that defence raised by the defendant of
alleged illegal money lending is a malafide defence. It is submitted that
transaction does not fall within the mischief of loan as envisaged by the
provisions of the Act, 2014.
It is the case of the defendant that the transaction between
plaintiff and defendant is not commercial transaction. It is also the
contention of the defendant that the plaintiff at the relevant time of the
loan, transaction was not having money lending license as required
under Section 13 of the Maharashtra Money Lending (Regulation) Act,
2014. It is stated that several disputed questions of fact are involved in
the suit. They are triable issues involved in the suit and same can only
be answered if the parties lead evidence in support of their contentions.
There is no much controversy that the defendant had
received the loan amount and had executed writings.
14. The learned Advocate for the plaintiff had banked upon the
following two clauses of subsection (13) of section 2 of the Money
Lending Act, 2014 which defines a loan as :
“ Loan” means an advance at interest whether
of money or in kind but does not include:
(j) an advance of any sum exceeding rupees [three
lakhs] made on the basis of a negotiable instrument
as defined in the Negotiable Instruments Act, 1881,
other than a promissory note;
(i) an advance made bonafide by any person
carrying on any business, not having for its primary
object the lending of money, if such advance is
made in the regular course of his business.”
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15. It is the case of the plaintiff that amount advanced was on
the basis of Negotiable Instruments Act, 1881. The learned Advocate
relied upon cheques issued by the defendant towards repayment of loan
amount and the writings by the defendant.
16. The plaintiff in its application submit that cheque for
Rs.5,35,000/was dishonoured. It is the case of the plaintiff that cheque
issued by the defendant was dishonoured. It appears that the time
lapse between the date of advance and between the date of issuance of
cheque is considerable. The element of proximity is not borne out. In
the absence of assertion which is proved by cogent evidence, it would
be difficult to draw an inference that the cheque was drawn on the very
date on which the loan was advanced or immediately so as to form part
of one and the same transaction.
It is no doubt true that mere advance of money on interest
by itself is not sufficient to bring the case within tentacles of the
provisions of Money Lending Act, and an advance made bonafide by
any person who carries on any business, such advance is made in the
regular course of business is excluded by clause (1) provided the
primary object should not be lending money on interest. To qualify as a
business, a course of lending money would require the elements of
system, continuity and repetition. One or few instances of lending
money on interest may not be satisfied the lending money.
17. It would be appropriate to note that it is the defence of the
defendant that the plaintiff is lending money on interest as a part of
business is a matter for adjudication. From the facts involved in the
present suit, the advance made by the plaintiff to the defendant on
interest, it may not be justified at the stage, to draw inference that the
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plaintiff is dealing in business of money lending. The defendant had
also relied upon the evidence of the plaintiff i.e. the complaint by the
plaintiff under Section 138 of Negotiable Instruments Act.
18. SubRule 3 of Order XIIIA relating to the summary
judgment reads as under:
“3. Grounds for summary judgment The Court
may give a summary judgment against a plaintiff or
defendant on a claim if it considers that
(a) the plaintiff has no real prospect of succeeding
on the claim or the defendant has no real prospect
of successfully defending the claim, as the case may
be ; and
(b) there is no other compelling reason why the
claim should not be disposed of before recording of
oral evidence.”
19. The Court may give a summary judgment against party to
the suit on the claim if its considers that, the plaintiff or the defendant
has no real prospects of succeeding on his claim or defendant has no
role prospect of successfully defending the claim as the case may be.
20(i) The plaintiff had contended that suit is filed under the
provisions of Negotiable Instruments Act. It is contention of the
plaintiff that amount of Rs.5,35,000/ have been advanced against
cheque and the suit is filed on the basis of dishonoured cheque as cause
of action and the provisions of the Bombay Money Lenders Act are not
attracted in the light of Section 2(i)(f) of the Negotiable Instruments
Act, 1881.
(ii) The defendant has raised two contentions, i) The plaintiff
has no license of money lending as required under Section 13 of the
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Maharashtra Money Lending (Regulation) Act, 2014 ii) The dispute
involved in the suit is not commercial.
The above referred points raised are triable issues involved
in the suit which can be dealt with only parties lead their evidence. In
view of the disputed question of facts involved in the suit, the plaintiff is
not entitled for summary judgment. Hence, I answered Point No. 1 “in
the negative”. In the result, following order is passed.
ORDER
Application for summary judgment No. 05/2020 is rejected.
(SANJAY N. YADAV)
Additional Sessions Judge
Date: 23.02.2021 Gr.Bombay at Mumbai.
Dictated on : 23.02.2021
Transcribed on : 24.2.21, 25.2.21 & 26.02.21.
Signed by H.H.J.on :03.03.2021
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
04.03.2021 at 5.00 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
23.02.2021
Judgment/order signed by P.O. on 03.03.2021
Judgment/order uploaded on 04.03.2021
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