1967 Supreme(AP) 62
Andhra Pradesh High Court
Judges : GOPALRAO EKBOLE
K.Appa Rao - Appellant
Versus
J.Suryanarayana Murthy - Respondent
Decided On : 06-20-67
The court has the discretion to grant leave to defend a suit under Order 37, rule 3, Civil Procedure Code, unconditionally or subject to such terms as it thinks fit.
Headnote:
ORDER 37, RULE 3, CIVIL PROCEDURE CODE - LEAVE TO DEFEND - CONDITIONS - DISCRETION OF COURT - EXERCISE OF.
Fact of the Case:
The defendant filed an application under Order 37, rule 3, Civil Procedure Code seeking permission of the court to defend the suit. The learned District Munsif granted permission to the defendant to raise the defense on the condition that he deposited Rs. 250 towards costs. The defendant filed a revision petition against the order.
Finding of the Court:
The court held that the lower court had not committed any error in the exercise of its discretion. The defendant had consented that he had to pay Rs. 1,000. The only defense which he intended to set up was in regard to Rs. 200 for which he had no satisfactory evidence to support that contention. It was plain from the affidavit that the defendant was more interested in prolonging the litigation by raising the plea of part payment unsupported by any documentary evidence. In these circumstances, the lower court was right in granting the defendant leave on condition that he deposits Rs. 250 towards costs.
Issues: Whether the lower court had exercised its discretion properly in granting the defendant leave to defend the suit on condition that he deposited Rs. 250 towards costs.
Ratio Decidendi: The court held that the lower court had exercised its discretion properly. The defendant had consented that he had to pay Rs. 1,000. The only defense which he intended to set up was in regard to Rs. 200 for which he had no satisfactory evidence to support that contention. It was plain from the affidavit that the defendant was more interested in prolonging the litigation by raising the plea of part payment unsupported by any documentary evidence. In these circumstances, the lower court was right in granting the defendant leave on condition that he deposits Rs. 250 towards costs.
Final Decision: The revision petition was dismissed with costs.
( 2 ) IT was contended by Mr. Adavi Rama Rao, the learned Counsel for the petitioner, that there was a triable issue and the Court ought not to have granted the leave on condition but must have granted the leave, unconditionally. In support of his contention, he relied upon the following two decisions: Sundaram Chettiar v. Valli Ammal, (1935) 68 M. L. J. 16 : I. L. R. (1935) 58 mad. 116 : A. I. R. 1935 Mad. 43. and Santosh Kumar v. Mool Singh, (1958) S. C. J. 434: (1958) 1 An. W. R. (S. C.) 159 : (1958) i M. L. J. (S. C.) 159 : (1958) S. C. R. 1211 : A. I. R. 1958 S. C. 321. In order to appreciate the implications of this contention it is necessary to read Order 37, rule 3, Civil Procedure Code. It is in the following terms: " (1) The Court shall, upon application by the defendant give leave to appear and to defend the suit, upon affidavit which disclose such facts as would make it incumbent on the holder to prove consideration, or such other facts as the Court may deem sufficient to support the application. (3) Leave to defend may be given unconditionally or subject to such terms as to payment into court, giving security, framing and recording issues or otherwise as the Court thinks fit. "
( 3 ) A careful reading and a close analysis of rule 3 would disclose that in order to successfully get the leave from the Court, the defendant has to make out in his affidavit facts which make it imperative on the holder of the negotiable document to prove consideration or such other facts as the Court may deem sufficient to support the application. In this case, no facts are pleaded wh ch make it incumbent upon the holder of the promissory note, that is co say, the plaintiff, to prove cons deration. What was pleaded in the affidavit was that the defendant has paid Rs. 200 to the plaintiff through his clerk on or about 15th April, 1961 as part payment. The payment was not admittedly endorsed on the promissory note non the defendant holds any receipt evidencing any such payment. The defendant did not give, any notice to the plaintiff prior to the institut on of the suite demanding the receipt or an endorsement upon the promissory note evidencing the p ayment. In these cercumstances the lower Court thought that the facts mention? d do not support the appication and yet granted leave on condition that the defendant deposited Rs. 250 towards costs. According to sub-rule (2) of Rule 3, leave to defend can be given unconditionally or subject to such terms as to payment into Court, giving stcurity, framing and recording issues or otherwise as the Court thinks fit. It confers a wide discretion on th