Bombay High Court
Ashok Avhad vs Roy Creado on 20 January, 2021
Bench: N. J. Jamadar
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
SUMMONS FOR JUDGMENT NO. 4 OF 2020
IN5
COMMERCIAL SUIT NO. 1118 OF 2019
Ashok Avhad
Aged : 62 years, an Adult, Indian Inhabitant,
Residing at 901, Shalin Co-operative Society
Ltd., Dr. M.B. Raut Road, Shivaji Park,
Dadar (West), Mumbai - 400028. .. Plaintiff
Vs.
Roy Creado
Proprietor of M/s. Roy and Associates
Aged : 61 years, an Adult, Indian
Inhabitant, Residing at 16, Ambrose
Villa, Sahar, Andheri (East), Mumbai 400 097. .... Defendant
Mr. Ashwin Shete a/w. Ms. Divya Tyagi, Mr. Prasad Sawant i/b Jayakar and
Partners for plaintiff.
None for defendant.
---
CORAM : N.J. JAMADAR, J.
DATE : 20th JANUARY 2021
ORAL JUDGMENT :
1. This commercial division summary suit is instituted for recovery of
the sum of Rs.1,00,24,493.53 along with further interest from the date of
the suit till realization.
2. The material averments in the plaint can be summarised as under :--
(a) The defendant represented to be a developer. The
defendant claimed to have developed a complex at 119,
Business Point, Sahar Road, near Air Cargo Complex, Andheri
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(East), Mumbai 400 099.
(b) On the representation of the defendant that he had
authority to sell the residential premises/offices in the said
complex, the plaintiff agreed to purchase a shop premises
bearing No. 16 for a lump sum consideration of
Rs.1,45,35,000/-. Towards part payment of the consideration,
the plaintiff paid a sum of Rs.45,00,000/- to the defendant in
five installments, from 16th December 2013 to 7th April 2014.
(c) The defendant, however, could not execute the
conveyance and hand over the possession of the said shop
premises. In lieu thereof, the defendant offered to sell another
office premises bearing No.417 in the said complex for a
consideration of Rs.1,22,85,000/- and agreed to adjust the
advance of Rs.45,00,000/- towards part payment. The
defendant could not perform the said agreement as well. It
transpired that the defendant had no authority to sell the said
office premises.
(d) Upon persuasion, the defendant agreed to repay the
amount of Rs.45,00,000/- to the plaintiff. Initially, the
defendant acknowledged the liability by executing a document,
dated 19th November 2014. The defendant also issued cheques
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towards repayment of the said amount. The cheques payable on
15th November 2014, 30th November 2014, 10th December 2014
and 10th January 2015, of varying amounts, aggregating to
Rs.45,02,500/- were however, returned unencashed due to
"insufficiency of funds". Ultimately, the plaintiff and defendant
entered into a Memorandum of Liability and Understanding on
23rd August 2016, wherein the defendant acknowledged the
liability to pay the entire amount of Rs.45,00,000/- along with
interest @ 18% per annum on the said amount of
Rs.45,00,000/- upto December 2016, by January 2017 with a
stipulation to pay further interest @ 18% per annum, in the
event of default.
(e) The defendant had drawn cheques for an amount of
Rs.50,00,000/- in the month of May 2017, September 2017 and
May 2018, respectively. However, those cheques were also
returned unpaid on presentment. Thus, a demand notice was
issued calling upon the defendant to pay the outstanding
amount along with interest. The defendant, however,
committed default in the payment of the outstanding amount.
Hence, the suit.
3. Pursuant to the service of the writ of summons, the defendant
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appeared. The plaintiff took out the summons for judgment No. 4 of 2020.
The defendant sought leave to defend. By order dated 31 st August 2020,
this Court was persuaded to grant conditional leave to the defendant to
defend the suit subject to depositing a sum of Rs.76,30,541/-, comprising
of the principal amount of Rs.38,50,000/- plus interest of Rs.37,80,541/-
calculated @ 18% per annum upto the date of institution of the suit, within
a period of twelve weeks therefrom.
4. Since the defendant failed to comply with the condition of deposit in
terms of the order dated 31st August 2020, the plaintiff has moved the
Court for an ex-parte decree after obtaining a non-deposit certificate.
5. By an order dated 12th January 2021, the plaintiff was directed to file
an affidavit in support of the claim and tender the original documents on
which the plaintiff relies. The plaintiff has filed an affidavit in support of
the claim (Exh.P-1) and a compilation of the original documents (Exh.P-2
to Exh. P-12) for the perusal of the Court.
6. Heard the learned counsel for the plaintiff.
7. It would be suffice to note that while granting leave to defend the
suit, subject to the condition of depositing the amount, this Court had
noted in clear and explicit terms there there was no dispute that at least
the amount of Rs.38,50,000/- has been paid by the plaintiff to the
defendant. Thus, the conditional leave was granted subject to deposit of
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the said amount along with interest at the agreed rate. The defendant had
failed to comply with the condition. In view of the provisions contained in
Clause (b) of Sub-rule (6) of Rule 3 of Order XXXVII of the Code of Civil
Procedure, 1908 ('the Code'), on failure of the defendant to give security
within the time specified or to comply with the condition on which the
leave to defend is granted, the plaintiff is entitled to judgment forthwith.
Nonetheless, this court has considered the justifiability of the plaintiff's
claim and the admissibility thereof under the provisions of Order XXXVII of
the Code.
8. The claim of the plaintiff that the defendant had acknowledged the
liability to pay the amount of Rs. 45,00,000/- along with interest @ 18%
per annum finds support in the memorandum of understanding (Exh.P-7).
Clauses 1 and 2 thereof read as under :
"1) The Owner hereby admits, accept and acknowledge that
the amounts of Rs.45,00,000/- were paid by the Purchaser
towards part payment of purchaser price of Shop No.16 and
has been adjusted subsequently towards part payment of
purchase price of Office Premises No.417.
2) The Owner further admit, accept and confirm that since
the Owner is unable to handover possession of the said Shop
and/or Office as represented by him, he is liable to refund the
said entire amount of Rs.45,00,000/- with interest and has
made an offer to the Purchaser to pay the same with interest @
18% p.a. calculated till December, 2016 and undertake to pay
on or before 30/01/2017. In the event of failure on part of the
Owner to pay the entire amount with interest, the Owner shall
be liable to pay further interest @ 18% w.e.f. 1-1-2017 till the
date of actual payment."
9. The memorandum of liability and understanding (Exh.P-7) records
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the history of the transaction between the parties, the endeavours made by
the defendant to repay the amount of Rs.45,00,000/-, which did not
materialise, and, ultimately, the acknowledgment of the liability. The
memorandum of liability and understanding (Exh.P-7) thus constitutes a
written contract and the claim becomes admissible under sub-clause (i) of
clause (b) of sub-rule (2) of Rule (1) of Order XXXVII of the Code.
10. The claim of the plaintiff that he has advanced a sum of
Rs.45,00,000/- was sought to be established by placing on record the
extract of statement of account of the plaintiff (Exh.'A' to the plaint). It,
however, revealed that the plaintiff had transferred an amount of
Rs.38,50,000/- only. The payment of a sum of Rs. 6,50,000/-, as mentioned
at Sr. No.4.2 of paragraph 4 of the plaint, is not reflected in the statement
of account. The court was, thus, persuaded to hold that there is no dispute
about the payment of a sum of Rs.38,50,000/- by the plaintiff to the
defendant. In fact, in the affidavit in reply to the summons for judgment,
the defendant had admitted the receipt of the said amount.
11. The learned counsel for the plaintiff urged that though there is no
material to substantiate the claim of payment of the said amount of
Rs.6,50,000/-, through banking channels, yet, various documents including
the memorandum of liability and understanding (Exh.P-7) indicate in clear
and explicit terms that the defendant had acknowledged the liability to pay
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a sum of Rs.45,00,000/-.
12. Undoubtedly, in the memorandum of liability and understanding
(Exh.P-7), the defendant had acknowledged the liability to pay a sum of
Rs.45,00,000/-. However, the fact that the payment was allegedly made by
the plaintiff through banking channel cannot be lost sight of. In the absence
of material to substantiate the claim in respect of the said amount of
Rs.6,50,000/-, it would be rather hazardous to decree the claim based on
the assertions of the plaintiff. It is pertinent to note that the suit is not
based on the cheques. Since the document relied upon by the plaintiff
along with the plaint indicates that a part of the claim is not substantiated,
it would be appropriate to decree the suit to the extent of Rs.38,50,000/-,
the payment of which is established beyond the pale of controversy.
13. There is a clear stipulation to pay interest @ 18% per annum. In the
circumstances of the case, the defendant would be liable to pay interest @
18% per annum from the date of the suit till realization.
14. The conspectus of the aforesaid consideration is that the plaintiff is
entitled to recover a sum of Rs.76,30,541/- along with further interest @
18% per annum on the principal amount of Rs.38,50,000/- from the date
of the suit till realization. Hence, the following order :-
ORDER
(i) The suit stands partly decreed.
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(ii) The defendant do pay a sum of Rs.76,30,541/- along
with further interest @ 18% per annum on the principal sum
of Rs.38,50,000/- from the date of the suit till realization.
Digitally
signed by (iii) The plaintiff is also entitled to refund of Court fees, if
Shraddha
Shraddha K. Talekar
K.
Date: any, in accordance with the rules.
Talekar 2021.01.22
15:39:15
+0530 (iv) The decree be drawn up and sealed expeditiously.
[ N.J. JAMADAR, J. ]
Shraddha Talekar PS
