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SUPREME COURT OF INDIA
(From the High Court of Delhi at New Delhi)
Vineet Saran, Dinesh Maheshwari, JJ.
B.L. Kashyap and Sons Ltd. – Appellant
Versus
M/s JMS Steels and Power Corporation & Anr. - Respondents
Civil Appeal No. 379 of 2022 (Arising Out of SLP (C) No. 19413 of 2018)
Decided On : 18-01-2022
(A) Civil Procedure Code, 1908 – Order XXXVII Rule 1 – Summary suit (Money suit) – Maintainability – Matter is based on written contract arising out of written purchase orders issued by appellant on instructions and on behalf of defendant No. 1 and plaintiff had raised e invoices against such supplies under purchase orders – Two cheques were issued by defendant No. 1 towards part payment against invoices – Assertion of plaintiff had been of joint and several liability of defendants – Question as to whether appellant was acting only as an agent of defendant No. 1 in relation to supplies in question and had no monetary liability, as sought to be raised by appellant, could be a matter of his defence – Such a proposition of defence by appellant cannot take away entitlement of plaintiff-respondent No. 1 to maintain summary suit in terms of Order XXXVII CPC – While asserting joint and several liability of defendants, plaintiff has also relied upon cheques said to have been issued by defendant No. 1, which were allegedly not presented as per request of said defendant No. 1 – Contention against maintainability of summary suit in terms of Order XXXVII CPC cannot be accepted. (Paras 14, 14.1 and 14.2)
(B) Civil Procedure Code, 1908 – Order XXXVII Rule 3 – Summary suit (Money suit) – Leave to defend – Triable issues – Generally, prayer for leave to defend is to be denied in such cases where defendant has practically no defence and is unable to give out even a semblance of triable issues before Court – In case of substantial defence, defendant is entitled to unconditional leave – Even in case of a triable issue on a fair and reasonable defence, defendant is ordinarily entitled to unconditional leave to defend – In case of doubts about intent of defendant or genuineness of triable issues as also probability of defence, leave could yet be granted but while imposing conditions as to the time or mode of trial or payment or furnishing security – Even in such cases of doubts or reservations, denial of leave to defend is not the rule; but appropriate conditions may be imposed while granting leave – It is only in the case where defendant is found to be having no substantial defence and/or raising no genuine triable issues coupled with Court’s view that defence is frivolous or vexatious that leave to defend is to be refused and plaintiff is entitled to judgment forthwith – In the case where any part of amount claimed by plaintiff is admitted by defendant, leave to defend is not to be granted unless amount so admitted is deposited by t defendant in Court – While dealing with an application seeking leave to defend, it would not be a correct approach to proceed as if denying leave is rule or that leave to defend is to be granted only in exceptional cases or only in cases where defence would appear to be a meritorious one – Even in case of raising of triable issues, with defendant indicating his having a fair or reasonable defence, he is ordinarily entitled to unconditional leave to defend unless there be any strong reason to deny leave – It gets perforce reiterated that even if there remains a reasonable doubt about probability of defence, sterner or higher conditions as stated above could be imposed while granting leave but, denying leave would be ordinarily countenanced only in such cases where defendant fails to show any genuine triable issue and Court finds defence to be frivolous or vexatious. (Paras 17, 17.2 and 17.3)
(C) Civil Procedure Code, 1908 – Order XXXVII Rule 3 – Summary suit (Money suit) – Leave to defend – Triable issues – Cheques, allegedly towards part payment against supplies made by plaintiff, had been issued by defendant No. 1 – In given set of circumstances, conclusion of High Court that defence raised by appellant was frivolous or vexatious could only be treated as an assumptive one and lacking in requisite foundation – Effect and impact of an admitted position of plaintiff, that payments were indeed made from time to time by defendant No. 1, seems not to have gone into consideration of t Trial Court and High Court while denying leave to appellant – Appellant has indeed raised triable issues, particularly concerning its liability and defence of appellant cannot be said to be frivolous or vexatious altogether – Impugned judgment and decree as passed by Trial Court, insofar relating to present appellant (defendant No. 2), set aside and appellant granted leave to defend. (Paras 18, 19.1, 20, 21 and 22)
Facts of the case:
Present appeal is directed against the judgment and order dated 11.05.2018 in Regular First Appeal No. 402 of 2018, whereby the High Court of Delhi at New Delhi has dismissed the appeal filed by the present appellant and has affirmed the judgment and decree dated 18.09.2017 passed by the Additional District Judge-05: West, Tis Hazari Court, New Delhi, in the money recovery summary suit, being CivDj/611333/2016, filed by the plaintiff-respondent No. 1, wherein the present appellant was arrayed as defendant No. 2 and the present respondent No. 2 was arrayed as defendant No. 1.
Findings of Court:
Taking these factors into account and, looking to the nature of claim and the nature of defence sought to be raised as also the fact that the appeal filed by the defendant No. 1 had been dismissed by the High Court, we find it just and proper to grant leave to defend to the appellant-defendant No. 2 while leaving it open for the Trial Court to pass appropriate orders regarding treatment of the said amount of Rs. 40,00,000/- deposited by appellant in terms of the order passed by this Court.
Result : Appeal allowed.
JUDGMENT :
Dinesh Maheshwari, J.
Preliminary
Leave granted.
2. This appeal is directed against the judgment and order dated 11.05.2018 in Regular First Appeal No. 402 of 2018, whereby the High Court of Delhi at New Delhi has dismissed the appeal filed by the present appellant and has affirmed the judgment and decree dated 18.09.2017 passed by the Additional District Judge-05: West, Tis Hazari Court, New Delhi, in the money recovery summary suit, being CivDj/611333/2016, filed by the plaintiff-respondent No. 1, wherein the present appellant was arrayed as defendant No. 2 and the present respondent No. 2 was arrayed as defendant No. 1.
2.1. It may be noticed at the outset that the Trial Court had passed the judgment and decree dated 18.09.2017 with its finding that no triable issues had been raised by the defendants and hence, they were not entitled to the leave to defend. In the impugned judgment and order dated 11.05.2018, the High Court has affirmed the decree in relation to the appellant-defendant No. 2. Hence, the questions involved in the present appeal are confined to the prayer for leave to defend sought for by the appellant. However, it is also relevant to notice that the other defendant (who is respondent No. 2 herein) had also filed an appeal against the said judgment and decree dated 18.09.2017 (being RFA No. 743 of 2018), which was dismissed by the High Court by its separate judgment and order dated 05.09.2018. The said judgment and order dated 05.09.2018 is not under challenge before us but, we shall refer to the same at the relevant juncture and in relation to the implications of the findings therein.
2.2. For the purpose of continuity of narration and discussion, the parties shall also be referred herein with reference to their status in the suit.
Relevant factual and background aspects
3. The relevant factual and background aspects of the matter are as follows :
3.1. The plaintiff-respondent No. 1 filed the subject suit in terms of Order XXXVII of the Code of Civil Procedure, 1908 (‘CPC’) while stating itself to be a registered partnership firm manufacturing and supplying a wide variety of iron and steel products. According to the plaintiff, the defendant No. 1 represented itself as a real estate and infrastructure development firm while the defendant No. 2 (appellant herein) represented itself as a contractor working with the defendant No. 1 for the construction work of its project namely ‘MIST’, being developed at Plot No.1, Sector 143-B, Noida.
3.2. The plaintiff asserted that in relation to the said construction work, it had supplied 200 tons of steel at the site address of the defendant No. 1; and this supply was made in terms of two purchase orders dated 06.02.2015 and 20.03.2015, as raised by the appellant-defendant No. 2. The plaintiff further asserted that payment for the goods so supplied was to be made by the defendant No. 1 and in that regard, various invoices were raised, as detailed in paragraph 7 of the plaint. It was also submitted that an amount of Rs.89,50,244/-remained due against the supplies so made and invoices so raised.
3.3. The plaintiff further averred that for payment against the said invoices, the defendant No. 1 issued two cheques drawn on Axis Bank, Sector-44 Noida Branch, being cheque No. 037274 dated 04.05.2015 for a sum of Rs.14,72,269/-and cheque No. 037272 dated 09.05.2015 for a sum of Rs.13,34,319/-while asking the plaintiff to present the cheques only after receiving intimation but no such intimation was received. Later on, the plaintiff issued a legal notice dated 28.01.2016 to the defendants demanding the dues and, upon their failure to make the requisite payment, filed the subject suit under Order XXXVII CPC, while asserting joint and several liability of the defendants. The plaintiff, inter alia, averred that the suit was based on written contract inasmuch as written purchase orders were issued by the appellant-defendant No. 2 on the instructions, and on behalf of, defendant No. 1.
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(1) Summary suit (Money suit) – Generally, prayer for leave to defend is to be denied in such cases where defendant has practically no defence and is unable to give out even a semblance of triable is....
A defendant in a summary suit is entitled to leave to defend if they raise plausible triable issues, even if the defense is not strong.
Point of Law - Court has considered the issue and confirmed the order passed by the learned trial court granting the application for leave to defend conditionally. All the rights and contentions of t....
The court ruled that leave to defend a summary suit should be granted where defendants raise substantial defenses; however, failure to demonstrate a triable issue leads to dismissal.
In a summary suit, if defendant discloses such facts of a prima facie fair and reasonable defence, court may grant unconditional leave to defend.
Point of Law - Order is contrary to the settled principles of law and once a party has given the cheque for setting right the accounts, then in that case, all such contentions which are not raised at....
Certified copies are admissible in summary suits, and defenses that do not raise triable issues can be dismissed without leave to defend.
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