Bombay High Court
M/S Kuber Steel Traders ... vs M/S Yash Enterprises Through Its ... on 3 July, 2017
Bench: R.V. Ghuge
WP/5650/2016
1
IN THE HIGH COURT OF JUDICATURE OF BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO. 5650 OF 2016
M/S Kuber Steel Traders
A partnership firm registered
under the Indian Partnership
Act, 1932, having its registered
office at C-31, Addl. MIDC Area
Aurangabad Jalna Road,
Jalna 431203
Through its Partner
Mr. Jitendra Ramniwas
Agrawal (Garg), Age 36 years,
Occ. Business, R/o 1-13-358,
Swami Dayanand Road,
Jalna. ..Petitioner
Versus
M/s Yash Enterprises
(A proprietorship firm through
its proprietor Mr. Faqruddin
Hatimbhai Rangwala,
Age major, Occ.Business
Having its office at :
1. S.No. 4/26/A, Ambegaon Bk.
Tq. Haveli, District Pune.
2. Yash Steel and Cement
Kudle Patil Corner,
Sinhgad Road,
Wadgaon Dhayari,
Near Hotel Abhiruchi,
Pune 411041.
3. Mr. Faqruddin Hatimbhai
Rangwala, General Constructions,
Shri Sidhivinayak Manasvi
Hill View, Ralicon Society
S.No.39/11-B-12,
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WP/5650/2016
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Ambegaon Budruk,
Datta Nagar,
Ambegaon Road,
Tq. Haveli, District Pune.
And residing at :
4. Mr. Faqruddin Hatimbhai
Rangwala, Flat No.407,
Orchid "B", Raheja Park,
Wanwadi, Pune. 411 040. ..Respondents
...
Advocate for Petitioner : Shri S.S.Patil
Advocate for Respondents 1 to 4 : Shri M.G.Deokate
...
CORAM : RAVINDRA V. GHUGE, J.
Dated: July 03, 2017
...
ORAL JUDGMENT :-
1. Heard learned Advocates for the respective parties.
2. Rule.
3. By consent, Rule is made returnable forthwith and the
petition is taken up for final disposal.
4. The petitioner is aggrieved by the order dated 29.2.2016,
passed by the trial Court in Summary Suit No. 5 of 2015, by
which, application Exhibit 21, filed by the defendants has been
allowed unconditionally.
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5. There is no dispute that in Summary Suits under Order
XXXVII of the Civil Procedure Code ("CPC") a procedure for
appearance of the defendants is prescribed. For the sake of
brevity, Order XXXVII Rules 3 to 5 of the CPC are reproduced
herein below:-
"ORDER XXXVII : SUMMARY PROCEDURE.
1. Court and classes of suits to which the Order is to
apply. ..........................
3. Procedure for the appearance of defendant.
(1) In a suit to which this Order applies, the
plaintiff shall, together with the summons under rule
2, serve on the defendant a copy of the plaint and
annexures thereto and the defendant may, at any
time within ten days of such service, enter an
appearance either in person or by pleader and, in
either case, he shall file in Court an a address for
service of notices on him.
(2) Unless otherwise ordered, all summonses,
notices and other judicial processes, required to be
served on the defendant, shall be deemed to have
been duly served on him if they are left at the address
given by him for such service.
(3) On the day of entering the appearance, notice
of such appearance shall be given by the defendant to
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the plaintiff's pleader, or, if tile plaintiff sues in
person, to the plaintiff himself, either by. notice
delivered at or sent by a pre-paid letter directed to
the address of the plaintiff's pleader or of the
plaintiff, as the case may be.
(4) If the defendant enters an appearance, the
plaintiff shall thereafter serve on the defendant a
summons for judgment in Form No. 4A in Appendix
B or such other Form as may be prescribed from time
to time, returnable not less than ten days from the
date of service supported by an affidavit verifying the
cause of action and the amount claimed and stating
that in his belief there is no defence to the suit.
(5) The defendant may, at any time within ten
days from the service of such summons for judgment,
by affidavit or otherwise disclosing such facts as may
be deemed sufficient to entitle him to defend, apply
on such summons for leave to defend such suit, and
leave to defend may be granted to him
unconditionally or upon such terms as may appear
to the Court or Judge to be just:
Provided that leave to defend shall not be
refused unless the Court is satisfied that the facts
disclosed by the defendant do not indicate that he has
a substantial defence to raise or that the defence
intended to be put up by the defendant is frivolous
vexatious:
Provided further that, where a part of the
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amount claimed by the plaintiff is admitted by the
defendant to be due from him, leave to defend the
suit shall not be granted unless the amount so
admitted to be due is deposited by the defendant in
Court.
(6) At the hearing of such summons for
judgment,-
(a) if the defendant has not applied for leave
to defend, or if such application has been
made and is refused, the plaintiff shall be
entitled to judgment forthwith; or
(b) if the defendant is permitted to defend as
to the whole or any part of the claim, the
Court or Judge may direct him to give such
security and within such time as may be fixed
by the Court or Judge and that, on failure to
give such security within the time specified by
the Court or Judge or to carry out such other
directions as may have been given by the
Court or Judge, the plaintiff shall be entitled
to judgment forthwith.
(7) The Court or Judge may, for sufficient cause
shown by the defendant, excuse the delay of the
defendant in entering an appearance or in applying
for leave to defend the suit.
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4. Power to set aside decree
After decree the Court may, under special
circumstances set aside the decree, and if necessary stay or
set aside execution, and may give leave to the defendant to
appear to the summons and to defend the suit, if it seems
reasonable to the Court so to do, and on such terms as the
Court thinks fit.
5. Power to order bill, etc., to be deposited with
officer of Court.
In any proceeding under this Order the Court may
order the bill, hundi or note on which the suit is founded to
be forthwith deposited with an officer of the Court, and may
further order that all proceedings shall be stayed until the
plaintiff gives security for the costs thereof. .............."
6. It is, therefore, obvious from the provisions of law that the
defendants have to disclose such facts before the Summary
Court, by which, they can convince the Court for granting leave
to defend unconditionally. Leave to defend can also be refused
by the Summary Court if it finds that the factors set out by the
defendants do not disclose any substantial defence and the
defence that is putforth appears to be frivolous and vexatious.
7. In my view, in matters of summary trials, while granting
the right of defence to the defendants, the trial Court has to
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make a conscious assessment, by which, it needs to be convinced
that the defence putforth is entertainable and then has to arrive
at the quantum of the recovery amount, which the defendants
are directed to deposit. This needs to be a subjective assessment,
though of a prima facie nature, as the law expects the summary
Court to compute the percentage of the amount that the
defendants are to deposit in such suits. In short, an equitable
order is to be passed and which cannot be based on bald
assertions of the defendants.
8. In the matter of Gaurav Singhania Vs. Matrix Agri Science
Pvt. Ltd. and others [2012 (1) All M.R. 129], this Court has
observed in paragraph Nos.5 to 8 as under:-
"5. The gist of the reasoning of the trial Court was that
since it was the case of the respondents that they had paid
substantial amount, there was a dispute between the parties
and hence unconditional leave ought to be granted. In so far
as the filing of the application, which was admittedly not
within the time prescribed, the trial Court observed that a
liberal view ought to has taken in such matters.
6. Heard the learned Counsel for the parties. In my
view, the impugned order granting unconditional leave
cannot be sustained in terms of Order 37, Rule 3(5) of the
Civil Procedure Code. It is well settled that Order 37 of the
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Civil Procedure Code is a self contained code, in so far as the
prosecution of the summary suits are concerned. In terms of
Order 37, Rule 3(5) of the Civil Procedure Code, a time
limit is prescribed for seeking leave to defend or otherwise
the applicant is obliged to file an application for
condonation of delay citing the reasons for the delay. In the
instant case none of the kind has been done though
admittedly the application for leave to defend has been filed
almost after 90 days of the summons being served upon the
respondents. The said aspect of delay has been totally
glossed over by the trial Court on the ground that in such
matters a liberal view has to be taken. The reasoning of the
trial Court cannot be sustained more so in view of the fact
that the issue before the trial Court was grant of
unconditional leave in the said summary suit.
7. In so far as the merits of the matter are concerned, it
is significant to note that in Clause (ii) the respondents have
merely made a bald assertion that the respondents have
paid substantial amount without specifying what amounts
paid and when the said amounts were paid and without this
material in support thereof, etc., the trial Court blissfully
accepted the said statement and arrived at a conclusion that
since there is a dispute between the parties unconditional
leave is merited. It is further pertinent to note that though
the correspondence between the Advocates was on record
wherein as indicated above, the Advocate of the respondents
has accepted the liability of the respondents to the extent of
Rs. 6,70,140/. The trial Court has also glossed over the said
material on record whilst considering the application for
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unconditional leave. The said order, therefore, cannot be
sustained in the teeth of the provisions of Order 37, Rule
3(5) of the Civil Procedure Code."
9. It is apparent from the said judgment that the aspect of
delay is also to be considered by the Summary Court and which
cannot be brushed away lightly or ignored. So also, the
Summary Court has to arrive at a conclusion as regards whether
the defendants plea consists of such merits that it can decide the
amount which such defendants are to deposit in the Court.
10. In the impugned order, the trial Court has considered that
28 cheques of Rs.1,00,000/- each and one cheque for
Rs.27,87,479/- were issued by the defendants in favour of the
plaintiff. The defendants have specifically taken a stand that all
the amounts set out in the cheques were already paid to the
plaintiff and in fact an excess amount of Rs.2,02,665/- has been
paid by the defendants. This mere assertion of the defendants
has been accepted by the summary Court. The impugned order,
does not in any way indicate as to whether the documents and
vouchers by which the defendants claim to have made the
payments, have been gone into by the Court. The Summary
Court should not have relied upon the mere statement of the
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defendants or the reply dated 25.4.2013, tendered by the
defendants to the legal notice issued by the plaintiff. An order
granting an unconditional right to defence is an unprecedented
order and which must be based on sound reasoning and
conclusions. The order must indicate that the Summary Court
has assessed the contentions of the defendants before granting
an unconditional right to defence.
11. In the light of the above, this petition is partly allowed.
The impugned order dated 29.2.2016 is quashed and set aside
and Exhibit 21 is restored to the file of the Summary Court in
Summary Suit No.5 of 2015. Needless to state, the Summary
Court shall consider Exhibit 21 in the light of the above
observations and keeping in view the law laid down by this Court
in Gaurav Singhania (supra). So also the issue of delay also
deserves to be gone into by the Summary Court while deciding
Exhibit 21.
12. Considering the request of the petitioner and the fact that
a Summary Case is at issue, the Summary Court shall decide
Exhibit 21 as expeditiously as possible and preferably on/or
before 15.9.2017.
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13. Rule is made partly absolute in the above terms.
( RAVINDRA V. GHUGE, J. )
...
akl/d
