JUDGMENT :

1. This Summons for Judgment seeks a decree against the defendant in the sum of Rs.5,54,00,000/- along with an amount of Rs.1,49,75,342.47 towards interest calculated on the amount of Rs.5,00,00,000/- @ 12% per annum from 1st January, 2017 to 30th June, 2019 (aggregating to Rs.7,03,75,342.47) and further interest @ 12% p.a. on the amount of Rs.5,00,00,000/- from the date of filing of the suit till payment and/or realization.

2. The above suit has been filed as a Commercial Summary Suit under the provisions of Order XXXVII of the Code of Civil Procedure, 1908 (for short “the CPC”) seeking a decree of the amounts mentioned above. The suit is based on two dishonoured cheques, one for Rs.5,00,00,000/- and the other for Rs.54,00,000/-. These two cheques were given by the defendant to the plaintiff. Both the aforesaid cheques were dishonoured when presented for payment, hence the present suit.

3. To understand in what circumstances these two cheques were issued by the defendant to the plaintiff, it would be necessary to refer to the facts and which are undisputed. In 2011, pursuant to the defendant’s request for financial assistance, the plaintiff agreed to disburse a sum of Rs.5 Crores to the defendant as a loan for business purposes. The said loan was repayable along with interest @ 19 % p.a. According to the plaintiff, on the basis of the defendant’s assurance of repayment along with the agreed rate of interest, the plaintiff issued a cheque of Rs.5 Crores dated 1st January, 2011 in favour of the defendant. The said cheque was duly encashed by the defendant and honoured by the plaintiff. On 3rd January, 2011, the defendant also drew a Bill of Exchange in favour of the plaintiff in the sum of Rs.5 Crores as a security for the said loan.

4. It is the case of the plaintiff that the defendant continued to pay interest on the loan to the plaintiff as per the agreed terms until 9th December, 2016. Thereafter, as the defendant wanted a reduction in the rate of interest, on 9th December, 2016, the defendant addressed a letter to the plaintiff inter alia acknowledging the plaintiff’s loan of Rs.5 Crores and requested the plaintiff to reduce the rate of interest to 12% p.a. By the said letter, the defendant requested confirmation of the revised terms, namely, that the interest amount of Rs.27,22,192/- at the rate of 12% p.a. till 31st December, 2016 would be paid through RTGS and thereafter the interest rate would be 12% p.a. payable at the end of the calendar year i.e. 31st December, 2017. Acceding to this request, the plaintiff obliged to reduce the rate of interest from 19% p.a. to 12% p.a. Accordingly, on 20th December, 2016, the defendant and four others gave an undertaking (Exhibit “D” to the plaint) to the plaintiff as well as two other persons, under which, inter alia, the defendant acknowledged the loan of Rs.5 Crores taken from the plaintiff and also agreed to issue the post-dated cheques for repayment. Accordingly, the defendant issued two post-dated cheques, one in the sum of Rs.5 Crores dated 1st January, 2018, and the other in the sum of Rs.54 Lacs dated 31st December, 2017 respectively. The cheque for Rs.5 Crores was towards the principal amount and the cheque for Rs.54 Lacs was towards interest.

5. On 26th March, 2018, the plaintiff deposited the aforesaid two post-dated cheques, which were dishonoured on 27th March, 2018. The cheques were returned with the remark “Funds Insufficient”. In these circumstances, on 17th April, 2018 the advocates for the plaintiff sent a notice under section 138 of the Negotiable Instruments Act, 1881 to the defendant inter alia stating that the defendant had acknowledged the debt due and payable to the plaintiff and in case of failure to pay, the plaintiff would be constrained to initiate criminal action under section 138 of the said Act. The defendant failed to respond to the said notice or make repayment. Hence, on 6th July, 2019, the plaintiff was constrained to file the present suit