A defendant raising a triable issue is entitled to unconditional leave to defend in a summary suit, and courts should avoid imposing harsh conditions that may hinder the defendant's ability to contest.

JUDGMENT :

Prafulla S. Khubalkar, J.

RULE. Rule is made returnable forthwith and heard finally with consent of the counsel for the parties.

2. By way of instant petition under Article 227 of the Constitution of India, the petitioners have challenged the order dated 15.03.2021 passed by the trial Court below application at Exhibit 15 filed under Order XXXVII Rule 3 of the Code of Civil Procedure, 1908 (for short, ‘the Code’) granting conditional leave to defend the summary suit.

3. The main controversy involved in the instant petition is whether in the wake of an inference of the trial Court that the petitioners having made out a triable issue are entitled for an unconditional leave to defend.

4. The background facts of the instant petition are as follows :-

The petitioners desired to purchase a rowhouse in a project of Sahara builders by name, Sahara Prime City situated at Wardha Road, Nagpur. The petitioners booked an independent house on 17.09.2007 for a total consideration of Rs.56,30,000/-. After payment of an amount of Rs.22,69,330/- out of the total consideration, the petitioners got executed a registered agreement to sell dated 24.04.2009 in their favour. For the purpose of arranging the balance consideration, Sahara Prime City had informed the petitioners that financial assistance can be availed from the respondent and accordingly petitioners applied for loan to the respondent. In view of a tie up which existed in between Sahara Prime City and the respondent, the loan of Rs.35,00,000/- was sanctioned by the respondent on the basis of an indemnity bond given by Sahara Prime City. Thereafter, on the basis of a demand note issued by Sahara Prime City, the respondent disbursed part of the loan amounting to Rs.24,66,529/- directly to Sahara prime city, on 25.01.2012. Although, the loan was disbursed, the project of Sahara Prime City went into serious trouble and the rowhouses were not at all constructed. However, in view of disbursal of the loan, the petitioners paid the EMI set by the respondent for more than three years from the date of mortgage and interest to the tune of Rs.8,31,000/- against the said loan. Since the entire project of Sahara Prime City had collapsed, the petitioners filed a complaint before the State Consumer Disputes Redressal Commission, Nagpur on 30.09.2015. On the other hand, the respondent had declared the account of the petitioners as NPA in the year 2016 and raised a demand notice under sub-Section 2 of section 13 of Securatisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The respondent also took symbolic possession of the mortgaged property.

Under these circumstances, the respondent filed Summary Suit No.476 of 2018 before the Civil Judge (Senior Division), Nagpur against the petitioners. After receipt of notice in the aforesaid suit, the petitioners filed an application under Order XXXVII Rule 3 of Code, seeking leave to defend, however on 15.03.2021, the trial court passed a conditional order on the application and granted leave to defend on condition of depositing 50% of the total claim amount in the said Court within a period of three months from the date of the order. Feeling aggrieved by this order passed by the trial court granting conditional leave to defend, the petitioners have filed instant petition.

5. Shri Bhushan Mohata, learned Counsel for the petitioners has vehemently submitted that the impugned order imposing condition to deposit 50% of the total claim amount as a condition to