Mayur Mangaldas Kothari And Ors vs Estate Of Late Neeraj Vinayak Vora ...
2021 Latest Caselaw 5627 Bom

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               IN THE HIGH COURT OF JUDICATURE AT BOMBAY

                             ORDINARY ORIGINAL CIVIL JURISDICTION

                      INTERIM APPLICATION (L) NO.2474 OF 2021
                                      IN
                  COMMERCIAL SUMMARY SUIT NO.1148 OF 2019
                                     WITH
                    SUMMONS FOR JUDGMENT NO.85 OF 2019
                                      IN
                  COMMERCIAL SUMMARY SUIT NO.1148 OF 2019
                                     WITH
                        INTERIM APPLICATION NO.2175 OF 2019
                                      IN
                  COMMERCIAL SUMMARY SUIT NO.1148 OF 2019

Mayur Mangaldas Kothari                                       ...Plaintiff
            vs.
Estate of Late Neeraj Vinayak Vora Through
Uttank Vinayak Vora And Anr.                                  ...Defendants
                                    .....

Mr. Karl Tamboly, a/w. Ms. Darla D'mello, Ms. Ruchi Turakhia & Ms. Ishani
Paradkar, i/b. Nityoah Suneel And Associates, for the Plaintiff.

Mr. Vishal Kanade, i/b. Mr. Aarif Alim Ali, for the Defendants.
                                     ....

                                      CORAM : S.C. GUPTE, J.

DATED : 25 MARCH 2021 (Oral Order) :

. The present commercial summary suit seeks a money decree for Rs.4,62,25,616/-, together with pendente lite and post-decree interest. The suit is premised on a written agreement as well as dishonoured cheques.

2. It is the Plaintiff's case that between 7 August 2015 and 23 November 2015, the Plaintiff transferred by RTGS an aggregate sum of

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Rs.2,05,00,000/- as a business loan to one Neeraj Vora (since deceased). The loan advanced and the terms of its repayment, including applicable interest and collateral security, are reflected in a writing executed between the Plaintiff and the late Neeraj Vora, which is Exhibit "A" to the plaint. It is the Plaintiff's case that pursuant to this writing, and in repayment of amounts lent through RTGS transfers referred to above, late Neeraj Vora handed over two post-dated cheques towards the principal loan amount Rs.2,05,00,000/- and payment of interest in the sum of Rs.97,50,274/-. It is the Plaintiff's case that both cheques were returned dishonoured with remarks "funds insufficient". Late Neeraj Vora died intestate on 14 December 2017. He is survived by his brother Uttank Vinayak Vora and his stepsister Kavita Subodh Hathi, both of whom are defendants to the present commercial summary suit. The Plaintiff claims the loan amount, together with interest, from the Defendants as legal heirs of the deceased.

3. The Summons for Judgment is contested by the Defendants. Affidavits-in-reply dated 17 Demeter 2019 and 19 December 2019, respectively, filed by Defendant Nos. 1 and 2 claim, firstly, that the cause of action for recovery of the loan amount first arose on 6 June 2016 and thereafter, in respect of different tranches of alleged payments on their alleged respective due dates for repayment; and, going by these dates, the suit is barred by the law of limitation. Secondly, it is submitted that the document of the alleged written agreement relied upon by the Plaintiff is a sham and fabricated document, prepared by the Plaintiff after the death of late Neeraj with a view to stake a claim of the estate of the deceased. Learned Counsel for the Defendants relies on the blanks in the written agreement set up by the Plaintiff in support of his submission. It is, thirdly, submitted that the Defendants are liable, if at all, only to the extent of the

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estate of the deceased coming into their hands and the question of such extent being a matter of trial, the Defendants deserve an unconditional leave to defend the suit.

4. Coming first to the defence of limitation, it is important to note that the cheques issued by late Neeraj, which were presented for payment and returned dishonoured on account of insufficiency of funds, were dated 10 November 2016. They were returned dishonoured on 11 November 2016 as evidenced by the written memos issued by the collecting bank. The cause of action for filing of a suit on the basis of a dishonoured cheque arises on the date the cheque was dishonoured. Going by the date of dishonour in our case, the suit is clearly within time, the plaint in the present suit having been lodged on 11 July 2019, that is to say, within three years of dishonour of the cheques. There is, accordingly, no merit in the defence of bar of limitation.

5. As for the merits of Plaintiff's claim, it is important to note that apart from a bare statement that the written agreement set up by the Plaintiff is a sham, bogus and fabricated document, there is no particular plea disputing either the cheque leaves used or signatures of late Neeraj Vora on the two cheques. The cheques have been drawn on Standard Chartered Bank, in which deceased Neeraj had an account, and there is nothing to indicate that the cheques themselves are fabricated. Even in the written agreement, the signature of late Neeraj is not a matter of dispute; the same has been attested by a Notary Public. Merely because in the written agreement, the cheque numbers and dates are blank, it cannot be said that the document is a fabricated or forged document. That, at the most, may imply that when the writing was signed, the cheque numbers and

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dates were left blank. The fact of the matter is that there have been cheques issued and they do bear numbers and dates. So far as the principal amount is concerned, the amount of the cheque has clearly been mentioned in the writing as a sum of Rs.2,05,00,000/-, which, in fact, is the amount of the cheque issued towards repayment of the principal. So far as interest is concerned, the amount mentioned in the writing is Rs.30,75,000/- as against the amount mentioned in the cheque towards interest, which was Rs.97,50,274/-. This discrepancy between the statement finding place in the written agreement and the particulars of the cheque, may call for a trial and thereby, leave to defend, so far as the interest amount is concerned, but there is no case for contesting the claim for refund of the principal amount loaned by the Plaintiff to late Neeraj on the basis of this discrepancy. After all, payment by the Plaintiff to late Neeraj is through RTGS and is an incontrovertible matter, and there is no plea set up by the Defendants to claim that this amount was paid for any other purpose, that is to say, other than towards the business loan. It is this loan amount which is reflected in the cheque as well as the written agreement, and which does not admit of any dispute on account of any discrepancy in the amount of interest payable or paid.

6. Coming now to the third and last defence of the Defendants, namely, that they are liable for repayment of the dues owed by late Neeraj to the Plaintiff only to the extent of the estate of deceased Neeraj coming into their hands, it is important to note that we are at the stage of adjudication of the Plaintiff's claim against late Neeraj sought to be recovered from the Defendants. As for the merits of this claim, the liability of the Defendants to account for the same is not really the issue at the stage of the decree. It is only when such decree is sought to be executed against

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the Defendants that they may set up a case of their liability being restricted to the estate of the deceased coming into their hands. In Bank of India vs. Industrial Polymer1, our court considered the question of maintainability of a summary suit against heirs and legal representatives of a deceased debtor. The court held that the protection under Section 52 of the Code of Civil Procedure given to the heirs and legal representatives of a deceased debtor was against the enforcement of a decree against them in execution; under Section 52, where a decree is passed against a party and such decree is for payment of money owed by a deceased debtor, such decree may be executed by attachment and sale of property of the deceased in the hands of his heirs and legal representatives. This protection is available at the stage of execution and not at the stage of passing of the decree. In the case before this court in Industrial Polymer, one of the defendants had died much prior to the filing of the suit. When this was found out during the course of the proceedings in the summons for judgment, the plaintiff applied for amendment to bring the legal heirs of the deceased on record. The defendants were, thus, sued in their capacity as heirs and legal representatives of a party, who had died prior to the filing of the suit. The learned Single Judge, who heard the summons for judgment, referred it for consideration by a Division Bench, expressing his disagreement with an earlier view expressed by another learned Single Judge of this court in the case of Rajesh Steel Centre vs. Rashmi K. Agarwal2. In Rajesh Steel, the learned Single Judge had held that a summary suit did not lie against a legal representative of a deceased person, who was not personally liable for the suit claim; the suit had to be treated and tried as a regular suit. The Division Bench in Industrial Polymer expressed its disagreement with the decision of the learned Single Judge in Rajesh Steel (supra). The Division

1 Vol. XCIII, The Bombay Law Reporter 218 2 (1986) Mh. L.J. 993

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Bench held that Order 37 did not exclude from its purview a suit where heirs and legal representatives of a deceased are party defendants. It held that under Section 52, where a decree was passed against a party as legal representative of a deceased person and the decree was for payment of money out of the property of the deceased, it might be executed by attachment and sale of such property. In other words, in so far as the defendant/judgment debtor is concerned, the decree could be executed only to the extent of the property of the deceased coming into the hands of the judgment debtor. The court held that the apprehension of the learned Single Judge in the case of Rajesh Steel was, accordingly, unfounded. The Division Bench relied on a decision of our court in the case of Lallu Bhagvan vs. Tribjuvan Motiram3, where our court had held that a decree against legal representatives of a deceased debtor could be passed even if such representatives had not inherited any property. The Division Bench held that if they had not inherited any property, the only result was that the decree could not be executed against them. That was, thus, a matter to be decided at the stage of execution; it did not affect the right of a court to pass a decree. The decision in Lallu Bhagvan was followed in Ranjitsingh vs. Ms. Narmadi4, where it was held that where the heir of a deceased debtor was sued, it was not open to him to raise the plea in the course of the suit that he did not hold any asset of the deceased debtor. The law, thus, having been settled by our court, the matter does not admit of any debate and the present summary suit, is clearly maintainable against the Defendants herein as legal representatives of a deceased debtor, and they cannot set up as their defence a plea that they do not hold adequate estate of the deceased debtor to satisfy the Plaintiff's claim.

3 (1889) I.L.R. 13 Bom 653 (D.B.) 4 (1931) A.I.R. Nagpur 173

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7. None of the three defences raised by the Defendants in the present case, thus, can be termed as plausible, at least so far as the principal amount of loan advanced by the Plaintiff to deceased Neeraj is concerned. Coming, however, to the aspect of interest, it does appear that there is a discrepancy in the amount of interest mentioned in the agreement set up by the Plaintiff and the amount reflected in the dishonoured cheque. There is no explanation offered by the Plaintiff for this discrepancy. In any event, even going by the interest rate stipulated in the written agreement between the parties, it is not clear how the interest of Rs.97,50,274/- is computed. As far as the interest is concerned, the Defendants, thus, deserve an unconditional leave to defend the suit.

8. So far as the principal amount is concerned, though the Defendants really do not have a plausible defence, it is possible to term it as somewhat probable and calling for a trial. The defence that the document was antedated by the Plaintiff may call for a trial, particularly considering that the Defendants have set up a case of indisposition of late Neeraj around October 2016. There is, thus, a case for grant of a conditional leave against deposit of the entire principal amount with a view to enable the Defendants to try and prove their case at the trial.

9. Accordingly, the summons for judgment is disposed of by granting the Defendants leave to defend the claim of principal amount prayed for in the suit against deposit of a sum of Rs.2,05,00,000/- in this Court within a period of six weeks from today. Upon deposit of this amount, the Prothonotary and Senior Master shall invest the same in fixed deposit/s of nationalised bank/s. The amount shall remain invested so as to abide by further orders that may be passed in the suit. So far as the

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Plaintiff's claim of interest is concerned, there will be an unconditional leave to the Defendants to defend the suit.

10. The Defendants are, accordingly, permitted to file their written statement concerning the Plaintiff's claim of interest in the suit within a period of six weeks from today. So also, in the event of deposit being made, the Defendants are permitted to file a written statement dealing with the Plaintiff's claim of principal amount within a period of four weeks of such deposit. The suit to come up for directions after ten weeks from today. The Summons for Judgment is disposed of accordingly.

11. In view of the order passed today on the Summons for Judgment, learned Counsel for the Plaintiff does not press Interim Application (L) No.2474 of 2021. The application is, accordingly, disposed of as not pressed.

12. As for Interim Application No.2175 of 2019, which is a miscellaneous application taken out by the Defendants under Section 340 of the Code of Criminal Procedure, this is not a stage for considering the application. The application deserves to be adjourned to the hearing of the suit. It is ordered accordingly.

( S.C. GUPTE, J. )

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