The judgment establishes that leave to contest should be refused unless substantial defenses are raised, and the issuance of cheques in favor of the plaintiff indicates an intention to make direct payment.

( 1 ) THIS is a suit for recovery of Rs. 5,57,207. 50 filed under Order 37 Civil Procedure Code.

( 2 ) THE defendant has sought leave to contest mainly on the grounds; firstly that there was no privity of contract between the parties as to the sale of maida ; secondly, the defendant has not received any bills whatsoever from the plaintiff and; thirdly, that the goods were being supplied to the defendant through m/s-R-S-Agency and the amount against dishonoured cheques has already been paid by the defendant to M/s. R. S. Agencies on 8/6/1998.

( 3 ) ACCORDING to the plaintiff, -which is, a Roller flour Mill and is engaged -In the production and sale of wheat products, defendant had approached for supply of maida directly and not through M/s-R. 5. Agencies. It is further averred that the defendant who manufactures breads, has been purchasing maida from the plaintiff on credit basis and the plaintiff has been supplying as per its orders and receiving payments of the outstanding bills from time to time. The details of the orders received and supply received by the plaintiff from time to time particularly in April and May have been given in para 7 of the plaint. Admittedly, the defendant had issued 6 cheques in the name of the plaintiff for Bill Nos. 189, 387, 400, 490 and 504 which when presented were dishowoured.

( 4 ) IN order to controvert this plea, learned. counsel for,the defendant ,has referred to the letter dated 22/6/1998 allegedly written by the plaintiff to the defendant wherein it has been specifically mentioned that maida was supplied to the defendant through Sh. Tej Pal singh of R. 5-Agencies.

( 5 ) IT is contended that cheques in question were issued much prior to the letter dated 22/6/1998 and had there been a direct dealing between the plaintiff and the defendant, the plaintiff would have referred to the factum of dishonouring of the cheques in the letter dated 22/6/1998 itself. The plaintiff did not do so as the defendant made the entire payment on 12/6/1998 to Mr. Raju of M/s. R. S. Agencies.

( 6 ) HOWEVER, learned counsel for the plaintiff has refuted it effectively by contending that had payment against these cheques made to M/s. R. S. Agencies or even to the plaintiff, it would not have been specifically mentioned in the letter dated 22/6/1998 that defendant has agreed to clear all the bills of the plaintiff and there would have been no reference to the bills in respect of which dishonoured cheques were issued.

( 7 ) SINCE defendant did not send any reply to this letter, inescapable inference is available that defendant had accepted the fact mentioned in the letter that some dues against bills in respect of which cheques were issued still remained unpaid. Mere denial by the defendant that defendant did not receive either the letter dated 22/6/1998 or the legal notice is not sufficient to controvert the contents thereof or to prove its claim of payment made to Mr. Raju of M/s,r. 5-Agencies. Even otherwise the defendant has failed to produce any document in support , of payment of dishonoured cheques or against the referred bills to Mr. Raju of M/s. R. 8. Agencies.

( 8 ) THE fact that cheques were issued in favour of the plaintiff by the defendant shows that defendant had ultimatley agreed to pay the dues of the plaintiff direclty to the plaintiff and not through m/s,r. S. Agencies. The contention that cheques were payable through M/s. R. S-Agencies is highly untenable and not acceptable. Merley because plaintiff has admitted that maida was being supplied through M/s,r. S. Agencies does not absolve the defendant of his liability from making payment of bills in respect of which cheques were directly issued in the name of the plaintiff. For this reason also the plea that since the plaintiff has not been able to show that ever in the past defendant has made any payment to the plaintiff either by way of cash or by way of cheques prima facie proves that defendant was having dealing through M/s.