Order 37 CPC applies to suits based on cheques, and the court may grant leave to defend on the condition that the defendant secures the amount claimed, even if the defense is illusory or frivolous.

Sat Pal, J.

1. In this case, the respondent-plaintiff field a suit for recovery of Rs. 16,50,000/- on the basis of three cheques bearing Nos.03295551 dated 28.7.1995 for Rs. 5 lacs; No. 03295552 dated 2.8.1995 for Rs. 5 lacs and No. 03295553 dated 10.8.1995 for Rs. 5,96,332/-, issued by the petitioner-defendants in favour of the plaintiff, under Order 37, CPC alongwith interest, future and pendente lite and costs. " The said suit was decreed by the Civil Judge, Senior Divisipn, Jagadhri vide judgment dated 21.12.1996. The learned Civil Judge observed that the defence which the defendants wanted to raise was illusory, sham and frivolous and they only wanted to prolong the case as it will take a number of years to decide the case if the defendants were allowed to file written statement and after framing of issues the evidence was allowed to be adduced. The present petition has been filed against the said judgment dated 21.12.1996 by which the leave to defend has been declined to the petitioner-defendants.

2. Mr. Goel learned counsel appearing on behalf of the petitioner-defendants submitted that Order 37 of CPC was not applicable to the present case as the present case was based on cheques and not on bills of exchange, Hundis or promissory notes or on written contract as envisaged in Order 37 CPC. He further submitted that the petitioners had raised a plausible defence in their application seeking leave to defend the suit. He submitted that the cheque book containing the cheques in question was taken away by the plaintiff fraudulently and the signatures on the cheques were fabricated. He, therefore, contended that the learned trial Court should have given leave to the defendants. He further submitted that even if the defendants had no defence or the defence was illusory the Court may protect the plaintiff by only, allowing the defence to proceed if the amount was secured and the leave could be given to the defendant on such condition. In support of his submission, he placed reliance on a judgment of the Supreme Court in Mechalec Engineers and Manufacturers and Ors. v. Basic Equipment Corporation, A.I.R. 1997 S.C. 577.

3. Mr. Gill, learned counsel appearing on behalf of the respondent submitted that Order 37, CPC was applicable to the suits based on Bills of exchange and a cheque has been defined as Bill of exchange drawn on a specified Banker under the provisions of the Negotiable Instruments Act, 1881 . He, therefore, contended that the Order 37, CPC was applicable to the facts of the present case.

4. The learned counsel further submitted that the petitioners-defendants in their application seeking leave to defend, had admitted that the defendants were having business transactions with the plaintiffs and some amount was payable by the defendants to the plaintiffs. He, therefore, contended that in view of the said facts, the learned trial Court was of the opinion that the grant of leave would merely enable the defendants to prolong the litigation by raising frivolous defences and accordingly declined the leave to the defendants.

5. I have given my thoughtful consideration to the submissions made by the learned counsel for the parties and have perused the records. Admittedly the suit in the present case, is based on three cheques and the cheque is a Bill of exchange as defined in the Negotiable Instruments Act, 1881 . Since the cheque is a bill of exchange, the provisions of Order 37, CPC shall apply to the facts of the present case. Accordingly, the contention of the learned counsel of the petitioner that Order 37 CPC was not applicable to the present case, is rejected.

6. From the reports, I find that defendant No. 1 (petitioner herein) in his application for leave to defend has admitted that they had been purchasing diesel from the plaintiff. It was, however, alleged that the amount due to the plaintiff from the defendants was negligible and the defendant No. 1 wanted the plaintiff to show the copy of the account to se