The main legal point established in the judgment is the application of Order XIIIA of the CPC to determine the probability of the defendant's defense in a commercial dispute and issue a conditional order for the defendant to deposit the loan amount.

JUDGMENT

IA 8177/2022

1. This application has been filed by the plaintiff under Order XIIIA of the Code of Civil Procedure, 1908, as applicable to the Commercial Disputes of a specified value, (hereinafter referred to as `CPC'), inter alia, praying for the following reliefs:

"a) Pass a summary judgement in favour of the Plaintiff and against the Defendant thereby Directing the Defendant to pay-

• A sum of INR 4,21,00,000/- [Indian Rupees Four Crores Twenty One Lakhs] as principal,
• A sum of INR 1,10,13,360/- [Indian Rupees One Crore Ten Lakhs Thirteen Thousand Three Hundred and Sixty] as interest@ 6.976% per annum, commencing from 1.09.2016 to 31.05.2020,
• A further sum of pendente-lite and future interest @18% per annum on the outstanding sum of INR 5,31,13,360/- [Indian Rupees Five Crores Thirty One Lakhs Thirteen Thousand Three Hundred and Sixty]."

CASE OF THE PLAINTIFF

2. It is the case of the plaintiff that the plaintiff is engaged in the business of Real Estate Development and Construction. The plaintiff has known the defendant for several years as the defendant is also engaged in the business of Real Estate. The parties entered into a congenial formal relationship. Sometime in the month of August 2016, the defendant approached the plaintiff and requested him for financial assistance to tide over his financial distress. The defendant promised the plaintiff to return the loan within a short period of time along with interest, on the assurance that he has various prospective business opportunities maturing soon which will enable him to repay the entire loan amount with interest. Based on such assurances, the plaintiff lent a sum of Rs.4,30,00,000/- (Rupees Four Crores Thirty Lakhs only) to the defendant in August, 2016. The defendant assured and promised the plaintiff that he would repay the said loan amount along with an interest of Rs.20 Lakhs within a period of eight months from the disbursement of the said loan. The Loan Agreement dated 01.09.2016 recording the agreed rate of interest on the principal amount of Rs.4,30,00,000/- as 6.976% p.a. was executed between the parties. The plaintiff further asserts that apart from the Loan Agreement, the defendant also executed a Promissory Note dated 01.09.2016 and issued the following three Post-Dated Cheques, collectively for an amount of Rs.4,50,00,000/-, in favour of the plaintiff:

3. The plaintiff asserts that after receiving the sum of Rs.4,30,00,000/-, the defendant ceased all contact and the plaintiff was unable to reach or communicate with him for many weeks altogether. Sometime in January 2017, the plaintiff and his wife accidentally ran into the defendant at the Defence Colony market. The plaintiff confronted the defendant and inquired from him about the reason for severing all contact with the plaintiff and whether the plaintiff would be receiving a sum of Rs.4,30,00,000/- as the date of presentation of the cheque was approaching. The defendant assured the plaintiff that he had sufficient funds to fulfill his obligations under the Loan Agreement and the cheques would be duly encashed on presentation.

4. In March 2017, however, when the plaintiff again approached the defendant to inquire whether the cheques would be honoured upon presentation, the defendant showed his inability to honour the cheques and sought some additional time to re-pay the loan amount. The defendant assured that in the month of May 2017 he would have sufficient funds in order to fulfil his obligations as per the Loan Agreement.

5. The plaintiff claims that on 29.05.2017, following the instructions and assurances of the defendant, he presented the aforementioned three cheques, however, the same were returned dishonoured with the remark "Dr