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2025 Supreme(Cal) 392

IN THE HIGH COURT AT CALCUTTA
HIRANMAY BHATTACHARYYA, J.
Nataraj Das - Appellant
Vs.
RKD Niraj JV & Ors. - Respondent
C.O. 1735 of 2025 And C.O. 1857 of 2025
Decided On : 11-07-2025

Advocate Appeared:
For the Parties :Mr. Rahul Karmakar, Ms. Gargi Goswami, Mr. Sounak Mukherjee Advocates, Mr. Suman Kumar Dutt, Sr. Advocate, Mr. Arnab Dutt, Ms. Monica Jaiswal, Ms. Laboni Dey Advocates

The court emphasized the necessity of proper service of summons in summary suits and the defendants' rights to defend, leading to the modification of the order directing the deposit of the admitted amount in court.

Headnote:(A) Constitution of India - Article 227 - Code of Civil Procedure - Order XXXVII - Commercial Courts Act, 2015 - Application under Article 227 of Constitution challenging order directing defendants to deposit a sum of money with the Learned Receiver - Suit for recovery of money filed as a summary suit under Order XXXVII; Defendants' right to defend forfeited for not entering appearance within ten days; impugned order modified directing deposit in court. (Paras 1, 3, 39)

(B) Right to Defend - The court must allow leave to defend unless satisfied that the defendant has no substantial defence or raises no genuine triable issues. (Paras 25, 32)

Facts of the case:
The plaintiff sought recovery of Rs. 61,65,540, with interest, from defendants based on unpaid invoices after completing work on a tender for construction. Defendants admitted liability for Rs. 32,37,314.03 but contended procedural flaws in the suit. (Paras 6, 7)

Findings of Court:
The Trial Judge correctly imposed a condition for deposit of admitted amount for defendants to maintain their right to defend. However, the court modified the order directing the deposit to be made in court instead of with a receiver. (Paras 27, 39)

Issues: The primary issues involved the validity of the summons issued, the right of defendants to seek leave to defend, and compliance with pre-institution mediation requirements. (Paras 11, 33)

Ratio Decidendi: The court emphasized the need for clear service of summons under relevant provisions before the defendants' rights can be forfeited, affirming the discretion of the trial court and ensuring procedural compliance. (Paras 30, 32)

Result: The impugned order was modified; defendants ordered to deposit the sum in court.

Table of Content
1. overview of the plaintiff's money suit. (Para 1 , 2 , 3 , 4 , 5 , 6)
2. disputes regarding service of summons and application for leave to defend. (Para 7 , 8 , 9)
3. relevance of code of civil procedure in commercial suits. (Para 10 , 11 , 12)
4. procedural requirements for summons in summary suits. (Para 13 , 14 , 15 , 16)
5. arguments on the forfeiture of right to defend based on summons. (Para 17 , 18 , 19 , 20)
6. claims regarding improper service of summons. (Para 21 , 22)
7. supreme court guidance on judicial discretion in commercial disputes. (Para 23 , 24)
8. trial judge's discretion in imposing conditions on leave to defend. (Para 25 , 26)
9. modification of the order regarding deposit conditions. (Para 27 , 28 , 29)
10. assessment of plaintiff's compliance with legal provisions. (Para 30 , 31 , 32)
11. issues regarding pre-institution mediation and its implications. (Para 33 , 34)
12. clarification of procedural matters addressed at trial. (Para 35 , 36 , 37)
13. precedent on deposit requirements by defendants. (Para 38)
14. final directive on amount deposit and withdrawing receiver. (Para 39)
15. conclusion of the case and orders issued. (Para 40 , 41)

JUDGMENT :

Hiranmay Bhattacharyya, J.

1. The plaintiff in Money Suit (Com) No. 161 of 2024 has filed an application under Article 227 of the Constitution of India being CO 1735 of 2025 challenging the order being no. 10 dated May 7, 2025 passed by the learned Judge, Commercial Court at Alipore. C.O. No. 1857 is at the instance of the 3rd defendant in the said suit and is directed against the self same order.

2. Both the civil revision applications were heard analogously as the applications arise out of common order and are decided by this order.

3. By the order impugned, the learned Judge of the Commercial Court disposed of the I.A. No. 02 of 2004 by directing the defendant to furnish a certain sum of money to the Learned Receiver and the Receiver was requested to keep the said sum by opening a fixed deposit in a nationalised Bank. The plaintiff was directed to pay an amount to the Learned Receiver as initial remuneration and the Receiver was given liberty to raise bill upon the plaintiff and the plaintiff shall have to pay such bill.

4. For the sake of convenience the parties shall be referred to hereinafter according to their status in CO No. 1735 of 2025.

5. Petitioner filed a suit for recovery of money under the provisions of Order XXXVII of the Code of Civil Procedure before the Learned Judge, Commercial Court at Alipore, District 24 Parganas (South) which is registered as M.S. (Com) 161 of 2024. Petitioner filed an application being IA 02 of 2024 praying for passing the judgment in accordance with Order XXXVII Rule 3(6) of the Code of Civil Procedure alleging that the opposite parties defaulted in entering appearance within 10 days of service of summons upon them.

6. The case as made out by the petitioner in the plaint in a nutshell is as follows:

The plaintiff runs and operates a sole proprietorship firm under the name and style "Modern Construction". The plaintiff is engaged in the business of constructions of building, demolition, real estate activities, specialized constructions activities and other allied businesses. The defendant no. 1 is a registered partnership firm consisting of the defendant no. 2 & 3 as its partners. The defendant no. 1 is a platform created by the defendants no. 2 & 3 so as to participate in the tender process floated by the Kolkata Metro Project in an around the city of Kolkata. The Defendant No. I had obtained the project work for Noapara and Dumdum Cantonment Metro. In order to pursue with the said tender process, several small tenders have been floated by the defendants from time to time as per the requirements of the principal tender. One of such tender for vibration free diamond cutting and dismantling of walls, top and bottom slabs of RCC culvert at Noapara Car shed Metro Project was floated by the defendants. The plaintiff bein

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