The main legal point established in the judgment is the requirement for a substantial or reasonable defense to be raised by the defendant in order to be granted unconditional leave to defend a suit.

R.S. Ramanathan , J.

1. The applicant/plaintiff filed a Civil Suit, viz., C.S.No.789 of 2010, on the file of this Court, under Order XXXVII, Rule 1 of the Code of Civil Procedure, for recovery of a sum of Rs.2,37,94,970/-with future interest at the rate of 3% per annum. In the said suit, the respondent/defendant filed an application, viz., A.No.7446 of 2010, for the grant of unconditional leave to defend the suit. The learned Master, by order, dated 09.04.2011, allowed the said application by granting leave. Challenging the said order, the present application is filed by the applicant/plaintiff.

2. Mr.Anirudh Krishnan, the learned counsel appearing for the applicant submitted that the learned Master, without properly appreciating the fact that no triable issues have been raised by the respondent ; that the respondent has not made out any good defence in the affidavit filed in support of A.No.7446 of 2010, granted unconditional leave to defend the suit filed by the applicant. Therefore, the order, dated 09.04.2011, passed by the learned Master, is liable to be set aside.

3. The learned counsel for the applicant further submitted that the applicant-Company filed the suit on the basis of 12 purchase orders (as detailed in the plaint), placed by the respondent/defendant. As per the purchase orders, the applicant/plaintiff supplied the machineries and they were also taken delivery by the respondent. After taking delivery of the machineries, the respondent made only partial payment of Rs.15,000/-USD by telegraphic transfer on 26.02.2009, and failed to pay the balance of Rs.4,88,857.94, despite repeated request and reminders made/sent by the applicant. Moreover, the respondent themselves agreed that they were liable to pay Rs.4,87,129/-as USD to the applicant and worked a repayment schedule. As per the said schedule, repayment started from April, 2010, and it was spread over, till September, 2011. Nevertheless, the respondent did not make any payment as per the schedule. Therefore, the suit was filed for recovery of Rs.2,37,94,970/-, as stated above.

4. The learned counsel for the applicant furthermore submitted that in the affidavit filed in support of A.No.7446 of 2010, viz., the application seeking unconditional leave to defend the suit, the respondent has just made certain allegations against the plaintiff and contended that triable issues were involved in the suit, but, no specific defence was taken by the defendant to defend the suit. Hence, the learned Master ought not to have granted leave and the essential ingredients of Order XXXVII, Rule 5 of CPC was not properly appreciated by the learned Master, and therefore, the leave granted is liable to be revoked. The learned counsel also took me through the Minutes of Meeting, dated 16.02.2010, wherein, the respondent admitted their liability and also the repayment schedule, but, there is no reciprocal promise to be performed by the applicant as per the memorandum of agreement, or, the Minutes of Meeting, dated 16.02.2010, and the various clauses, viz., E, F, G and I are independent clauses and they have nothing to do with the repayment schedule agreed by the respondent. Therefore, the respondent has not shown any triable issues or substantial defence, and having agreed to pay the amount, the respondent should not have been granted unconditional leave. Hence, the learned counsel prayed for allowing this Application.

5. The learned counsel for the applicant relied upon the following reported judgments, in support of his case:-

i) (1998) 5 S.C.C. 354 in the case of (Sunil Enterprises and another Vs. SBI Commercial & International Bank Ltd.,).

ii) (2008) 6 C.T.C. 660 (SC) in the case of (Southern Sales & Services and others Vs. Sauermilch Design & Handles Gmbh).

Iii) (1972) Volume 42 Company Cases 125 (S.C.) in the case of (Madhusudan Gordhandas and Co. Vs. Madhu and

iv)(2008) 4 S.C.C. 246 in the case of (SIFY Ltd., Vs. First Flight Couriers Ltd.,).

6. Though the respondent w