Daryanani(Indo Saigon) ... vs Mantri Realty Ltd
2017 Latest Caselaw 6381 Bom

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              IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                 ORDINARY ORIGINAL CIVIL JURISDICTION

                             IN ITS COMMERCIAL DIVISION

                    SUMMONS FOR JUDGMENT NO. 38 OF 2014
                                   IN
                      COMMERCIAL SUIT NO. 114 OF 2014

Daryanani (Indo Saigon) Construction
Pvt. Ltd.                                  .... Plaintiff
      Vs.
Mantri Realty Ltd.                         ....Defendant
                                    ----
Mr.J.P. Sen, senior advocate a/w. Mr.Sandeep Parikh and Mr.Abhishek
Sawant a/w. Mr.Trupti Talati i/b Subhash Pradhan and Co. for plaintiff.

Mr.S.A. Bhagwat for defendant No.1 (in liquidation).
                                  ----

                                         CORAM : K.R.SHRIRAM, J.

DATE : 21ST/22ND AUGUST, 2017

P.C. :

1 Some time in 2008-2009, plaintiff gave a Short Term Loan of Rs.15

crores to defendant no.1 (in liquidation). This amount of Rs.15 crores was

disbursed in four tranches of Rs.10 crores, Rs.3 crores, Rs.1 crore and Rs.1

crore, respectively. For the purpose of making repayment, defendant no.1 (in

liquidation) issued a post dated cheque dated 30th June 2009 for Rs.15 crores

in favour of plaintiff. Copy of the cheque is annexed at Exh.B to the plaint.

On 1st January 2009, a Deed of Guarantee was executed by the then

Chairman and Managing Director of defendant no.1 (in liquidation), a

S.K. Talekar, PS

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person by the name Sunil Mantri, who, in his personal capacity

unconditionally and irrevocably guaranteed repayment of the said loan

amount of Rs.15 crores to plaintiff. Defendant no.1 (in liquidation) also

executed a Bill of Exchange for a valuable consideration of Rs.15 crores in

favour of plaintiff for availing of the Short Term Loan.

2 By a letter dated 10th February 2009, defendant no.1 (in liquidation),

while acknowledging receipt of Rs.15 crores as loan and also while

acknowledging the fact that defendant no.1 (in liquidation) had issued a post

dated cheque of Rs.15 crores in favour of plaintiff, also gave as security to

plaintiff by way of charge on 60 flats admeasuring about 50214 sq.ft.

approximately in a project that was being developed by defendant no.1 (in

liquidation) as per the details contained in the said letter. On 30 th June 2009,

when payment of Rs.15 crores fell due, defendant no.1 (in liquidation)

requested plaintiff not to deposit the cheque and sought extension. This has

been confirmed by defendant no.1 (in liquidation) in its letter dated 3 rd

September 2009 (Exh.'F' to the plaint). Thereafter, defendant no.1 (in

liquidation) offered to plaintiff as a substitute to the 60 flats given as

security, 27 flats in another project of defendant no.1 (in liquidation) which

was also accepted by plaintiff. On 30 th July 2010, defendant no.1 (in

liquidation) paid to plaintiff a sum of Rs.2 crores and on 3 rd August 2010,

S.K. Talekar, PS

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paid a sum of Rs.1 crore leaving a balance of Rs.12 crores as due and

payable to plaintiff. Defendant no.1 (in liquidation) also issued a cheque

dated 1st April 2011 for a sum of Rs.12 crores towards repayment of the

balance amount of Rs.12 crores. This cheque was not deposited by plaintiff

at the request of defendant no.1 (in liquidation).

3 By a letter dated 6th July 2012, defendant no.1 (in liquidation) sought

balance confirmation from plaintiff of Rs. 12 crores and in response to the

balance confirmation, plaintiff has stated that the amount of Rs.12 crores is

payable together with interest thereon at 18% per annum. It is to be noted

that for the first time, plaintiff has referred to any interest as payable and rate

of interest. Thereafter, by a letter dated 30th April 2013, defendant no.1 (in

liquidation) once again forwarded to plaintiff a fresh post-dated cheque for

Rs.12 crores towards repayment of loan. This cheque dated 15 th October

2013 (Exh."N1" to the plaint), when deposited on 15 th October 2013, was

dishonoured due to insufficient funds. Counsel for plaintiff, therefore, is

seeking a summary decree on the basis that there has been an

acknowledgement of debt and defendant has issued a cheque which came to

be dishonoured.

4           So far as the rate of interest is concerned, counsel for plaintiff, in


S.K. Talekar, PS





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fairness, stated that there is nothing on record except plaintiff's endorsement

in the balance confirmation that interest was payable at 18% per annum. But

at the same time, counsel submitted that under Section 80 of the Negotiable

Instruments act, 1881, when no rate of interest is specified in the instrument,

interest payable will be 18% per annum from the date at which the same

ought to have been paid by the party charged and the date in this case will be

15th October 2013, i.e., the date of the cheque which came to be

dishonoured.

The counsel for plaintiff tendered a compilation of 18 documents of

which 15 documents are certified as 'true copy' by the Metropolitan

Magistrate's 14th Court, Ballard Pier, Mumbai. So far as the document at

Sr.No.13, counsel for plaintiff submitted that the original has been returned

to defendant no.1. Statement accepted. So far as the document at Sr.No.2 and

Sr.No.4, counsel states originals are not traceable. Nevertheless, nothing

much turns on those documents. Therefore, the compilation is taken on

record and marked as Exh.P-1 colly.

5 Mr.Bhagwat appearing for defendant no.1 (in liquidation) first sought

time to file an affidavit in reply to the summons for judgment. Mr.Bhagwat

also stated that the Official Liquidator will not have any personal knowledge

of the transaction. I did not find it necessary to grant any further time

S.K. Talekar, PS

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because the summons for judgment has been pending since 2013 much

before defendant no.1 went in liquidation and defendant no.1 never filed any

affidavit in reply. Secondly, the Official Liquidator would not be able to aver

in affidavit on the underlying transaction. Therefore, I decided to proceed on

the basis of mere denial by the Official Liquidator.

6 From the documents relied upon by plaintiff, it is quite obvious that a

sum of Rs.12 crores was due and payable by defendant no.1 (in liquidation)

to plaintiff. To that extent, defendant no.1 (in liquidation) has also issued a

cheque in favour of plaintiff. Defendant no.1 (in liquidation) carries on

business within the jurisdiction of this Court and therefore this Court has

jurisdiction. The last cheque for Rs.12 crores was issued on 15 th October

2013 and the suit was lodged on 1st April 2014 and hence the suit is also

within limitation.

7 So far as the interest is concerned, even if there is no agreement

between the parties to claim any specified interest, plaintiff is entitled to

include interest amount in a Summary Suit in terms of Section 80 of the

Negotiable Instruments Act, 1881 read with Order 37 of Code of Civil

Procedure, 1908. It will be useful to reproduce paragraph 11 of an order

dated 20th April 2012 passed by the Delhi High Court in Sanjay Kohli Vs.

S.K. Talekar, PS

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Vikas Srivastava & Ors. 1. The same reads as under :

11 The other contention raised by the counsel for the defendant no.1 is that the amount of interest cannot be claimed in a summary suit under Order XXXVII is also devoid of any merit. This issue is no more res integra as the settled legal position is that even if there is no agreement between the parties to claim any specified interest, the plaintiff is entitled to include the interest amount in a summary suit in terms of Section 80 of the Negotiable Instrument Act read with Order XXXVII of CPC. It will be relevant here to refer to the judgment of this court in the case of S.K. Malhotra Vs. Man Mohan Modi 166(2010) DLT723 wherein the court while granting the interest in a summary suit held as under:

"4. In the case of Secretary, Irrigation Department, Government of Orissa and Ors. v. G.C. Roy reported as : AIR 1992 SC 732, the Supreme Court held that a person is entitled to the payment of interest on the principal amount and the security deposit illegally retained, on the ground that the person deprived of the use of money to which he is legitimately entitled, has a right to be compensated for the deprivation, call it by any name. Even in the present case, it cannot be disputed that the appellant was deprived of the use of the money to which he was legitimately entitled and thus he had a right to be compensated for the period of deprivation at least from the date of institution of the suit till the date of passing of the decree."

As manifest from above, the plaintiff would be entitled to the amount of interest even if there is no term regarding payment of CS(OS) No. 1754/2010 pg. 15 interest stipulated between the parties.

8 In the circumstances, Suit stands decreed in the sum of Rs.12 crores

together with interest thereon at 9% per annum from the date of cheque, i.e.,

15th October 2013 until payment/realization.

1 2013 Volume 196 DLT 237

S.K. Talekar, PS





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9           Decree be drawn up accordingly.



10          In view of above, summons for judgment stands disposed.




                                                     (K.R. SHRIRAM, J.)




S.K. Talekar, PS