J U D G E M E N T

I.A.5270/2017

1. An application under Order XIIIA read with Section 151 of the Code of Civil Procedure, 1908 (hereinafter referred to as “CPC”) has been filed on behalf of the plaintiff for Summary Judgment.

2. The material facts as stated in the application are that the plaintiff gave a loan of ₹5,10,75,000/- to the defendant no. 1 through 14 account payee cheques issued between February, 2017 to July, 2018. All the cheques were honoured and the amounts were credited to the bank account of defendant No.1. It was orally agreed that defendant No.1 shall pay an interest @ 12% per annum to the plaintiff on the loan amount. The defendant No.1 returned a sum of ₹22,00,000/- to the plaintiff on account of the pending loan through account payee cheques dated 01st December, 2008 in the sum of ₹10,00,000/- and cheque dated 06th December, 2008 in the sum of ₹12,00,000/-.

3. The defendant no.1 did not give any directions to the plaintiff in regard to the appropriations of the said amounts, and thus, the plaintiff appropriated the amounts firstly towards the accrued interest and thereafter towards the principle amount. The statement of account of the plaintiff Company reflects the entries of the amounts paid in the account of the defendant Company and also reflects an amount of ₹22,00,000/- received from the defendant No. 1 towards partial discharge of the loan liability.

4. The plaintiff has asserted that defendant No.1 in its written statement did not deny the fact of honouring the cheques and of the amount being credited to his account. However, a defence was set up that the plaintiff Company is owned, managed and controlled by Ms. Jyoti Kesari and her husband Manoj Kesari who are the daughter and son-in-law of Shri R.P. Mittal, defendant No. 2 ex-Managing Director of the defendant no.1 Company. At the relevant time, Jyoti Kesari and Vandana Mittal, the daughters of Sh. R.P. Mittal, were appointed as Vice president of Plaintiff Company on a salary of ₹25,000/- p.m. They all devised a mechanism to defraud the defendant no. 1 Company and defendant no. 2 took out the money from the account of the defendant Company immediately after it was credited and transferred it back to his account; thus, leaving no money as paid in the account of defendant’s Company but creating a liability against defendant Company by such transactions. It is asserted that the defendant except this bald assertion, has not filed any document in support thereof and it is evident that the defendants have no defence. In fact, the amount of ₹5,10,75,000/- has been shown in the books of defendant No. 1 Company in the year 2007 thereby admitting having received amount. This amount has also been shown in its Balance Sheet and defendant No.1 has admitted unsecured loans of ₹30 lakhs in its Balance Sheets. The amount so received has not been disputed by the defendant No.1. Even in the reply to the legal Notice, defendant No.1 has specifically mentioned that the amounts received were siphoned off, which again shows that it has admitted the credit of loan amount to the account of defendant no. 1. No record or documents have been filed to corroborate the assertions of money being taken away or siphoned off.

5. The plaintiff has also referred to the copies of CS (OS) 61/2012 filed by defendant no. 1 Company against the several defendants including defendant no. 2 and the plaintiff herein. It is asserted that defendant no. 1 has specifically stated in paragraph 12C in reference to the defendant no. 2 in this Suit, that the money was brought in through the defendant no. 1 Company, but was immediately taken out by defendant No. 2 on various fake pretences leaving a mere entry in the books of defendant No.1 Company, thereby clearly admitting that the amount of loan was received by defendant No. 1 Company.

6. The plaintiff has asserted that defendant no. 1 Company is a separate legal entity and is distinct from its Shareholders and its Directors. The money was paid to def