Bombay High Court
Radhika Kamal Mirani Alias Rashmi Vijay ... vs Nisha Purshottam Mirani on 27 March, 2025
Author: N. J. Jamadar
Bench: N. J. Jamadar
2025:BHC-AS:14280
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.16611 OF 2024
Radhika Kamal Mirani
VISHAL @ Rashmi Vijay Rijhwani ...Petitioner
SUBHASH
PAREKAR vs.
Digitally signed Nisha Purshotam Mirani ...Respondent
by VISHAL
SUBHASH
PAREKAR
Date: 2025.03.27
19:42:29 +0530 Mrs. Sushma Singh a/w. Ms. Sayali Sawant, for the Petitioner.
Mr. Jagdish Choudhary i/b. M/s.Raj Legal, for the Respondent.
CORAM : N. J. JAMADAR, J.
DATE : MARCH 27, 2025
JUDGMENT :
1. Rule. Rule made returnable forthwith and with the consent of
the counsel for the parties, heard finally.
2. This petition under Article 227 of the Constitution of India
assails the legality, propriety and correctness of an order passed by
the learned Judge, City Civil Court in Summons For Judgment No.
130 of 2023 in Summary Suit No. 125 of 2023 whereby leave to
defend the suit was granted to the defendant subject to the
condition of deposit of 25% of the principal amount of the suit claim.
3. Shorn of unnecessary details, the background facts leading to
this petition can be stated as under.
4. For the sake of convenience and clarity, the parties are
hereinafter referred to in the capacity in which they are arrayed
before the City Civil Court.
Vishal Parekar, PS ...1
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5. The plaintiff is the mother-in-law of the defendant. The
plaintiff has instituted the suit for recovery of a sum of Rs.
13,23,000/- which she has allegedly lent to the defendant so as to
facilitate her to subscribe to the share capital of Kamya Forex and
Gold India Private Limited (the company) floated by her son Kamal
Miran, the husband of the defendant. Interestingly, the mother in
law has instituted the suit through her son who is stated to be her
constituted attorney.
6. Beneath the apparent financial dispute, there is an underlying
and deep rooted matrimonial and familial dispute between the
parties. On account of the marital discord, the defendant is
estranged from her husband Kamal. Multiple proceedings are
pending between the defendant, on the one part, and her husband
and the plaintiff, on the other part, including a proceeding under
the Protection of Women From Domestic Violence Act, 2005, which
is subjudice before the Court of Magistrate, Andheri.
7. Unsurprisingly, the plaint refers to the marital discord and
the strained relations between the plaintiff and the defendant and
the circumstances in which on account of the allegedly quarrelsome
and adamant attitude of the defendant, the plaintiff had to lend the
amount of Rs. 13,23,000/- to the defendant, purportedly to buy
peace.
Vishal Parekar, PS ...2
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8. It is the claim of the plaintiff that in the month of June, 2018
Kamal Mirani was in the process of starting the company, the
defendant tried to put hindrances therein and, eventually, agreed to
allow Kamal to start the new venture only upon extracting a
bargain to appoint her as a Director on the Board of Directors of the
said company. Since the defendant had no money to purchase the
share of the said company, the plaintiff had lent a sum of Rs.
13,23,000/- to the defendant on the condition that the said amount
would be repaid without any interest. The amount was transferred
through banking channels and from the account of the defendant
the said amount came to be credited to the account of the said
company.
9. Marital discord between the defendant and Kamal escalated
resulting in multiple proceedings and, on 18th March, 2020 the
defendant addressed an email seeking to resign from the Board of
Directors of the said company and demanded the refund of the sum
of Rs. 13,23,000/- towards her share capital by a demand draft.
10. Asserting that there was a liquidated sum of money due and
payable by the defendant to the plaintiff evidenced by statement of
bank accounts and that the aforesaid email dated 18 th March, 2020
constituted a clear acknowledgment of the debt, the plaintiff
instituted a summary suit for recovery of the said amount. Initially,
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the suit was converted into a commercial suit. The defendant filed
written statement on 16th September, 2021.
11. The plaintiff took out Notice of Motion No. 2717 of 2001 for a
decree on admission. By an order dated 24 th August, 2022 the said
Notice of Motion was dismissed.
12. The learned Judge, Commercial Court, on a Notice of Motion
taken out by the defendant, being Notice of Motion No. 3549 of 2022
for the rejection of the plaint, passed an order that the suit be
assigned to a regular Court as the dispute was not a commercial
dispute within the meaning of section 2(1)(c) of the Commercial
Courts Act, 2015. Thereupon, the plaintiff filed the Summons for
Judgment.
13. By the impugned order, the learned Judge was persuaded to
grant conditional leave to defend the suit observing, inter alia, that
in the backdrop of the familial dispute between the parties and the
contentions of the defendant that Kamal, her husband, was
exclusively managing the affairs of the said company as well as the
operation of the accounts of the defendant, triable issue was raised
by the defendant. However, since the defendant admitted the
liability by addressing aforesaid email dated 18th March, 2020,
leave to defend was required to be granted subject to deposit of 25%
of the principal amount.
Vishal Parekar, PS ...4
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14. Being aggrieved, the defendant has invoked the writ
jurisdiction.
15. Mrs. Sushma Singh, the learned counsel for the petitioner,
submitted that the instant suit is a link in the chain of the actions
and proceedings initiated by the husband of the defendant to harass
her. The learned Judge, despite noting that there were matrimonial
and familial disputes between the parties and that Kamal, the
husband of the deceased, was controlling the personal as well as the
corporate affairs of the defendant and there was a triable issue,
went on to unjustifiably impose a condition of deposit of 25% of the
amount. Once the learned Judge recorded a finding that the
defendant has raised a triable issue, unconditional leave ought to
have been granted, urged Mrs. Singh.
16. Mrs. Singh further submitted that the summary suit itself
was not tenable. The basis of the suit is an honoured cheque under
which the amount was transferred to the joint account of the
defendant and Kamal. A summary suit is not maintainable on a
honoured cheque as it can not be said to be a suit based on
negotiable instrument. To lend support to this submission, Mrs.
Singh placed a strong reliance on a Full Bench Judgment of this
Court in the case of Jyotsna K. Valia vs. T.S. Parekh and Co.1
17. It was further submitted that the learned Judge was in error
1 2007 (4) Mh.L.J. 517.
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in holding that the defendant had acknowledged the liability. The
said communication, was addressed in the context of the stand of
Kamal in the proceeding under the Protection of Women From
Domestic Violence Act, 2005 that, he had suffered complete loss in
the said company. Therefore, the defendant was constrained to
resign from the Board of Directors of the said company and seek
refund of capital. Inviting attention of the Court to the affidavit in
rejoinder filed in this petition, Mrs. Singh attempted to explain
away the said demand by asserting that the defendant was to, in
turn, return the amount to the plaintiff.
18. Per contra, laying emphasis on the said email dated 18 th
March, 2020 and the aforesaid assertion in the rejoinder, Mr.
Jagdish Choudhary, the learned counsel for the respondent,
forcefully submitted that the aforesaid documents contain a clear
and categorical admission of the liability. In fact, by way of
rejoinder, the defendant had tried to dilute the admission by
claiming that the amount was to be repaid to the plaintiff. That, in
itself, according to Mr. Choudhary, constitutes an acknowledgment
of the debt.
19. Refuting the contentions on behalf of the petitioner that the
suit in the present form is not maintainable as a summary suit as it
is based on an honoured cheque, Mr. Choudhary urged with tenacity
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that the suit is for recovery of a debt or liquidated amount. Such a
suit is maintainable sans a written contract, was the thrust of the
submission of Mr. Choudhary. To buttress this submission Mr.
Choudhary placed a strong reliance on a Division Bench judgment
of this Court in the case of Gokuldas Poddar vs. Ramrikhdas
Parasrampuria and Co.2.
20. In the said case it was enunciated that in the context of Rule 2
of Order 37, as it then stood, the rule itself assumed that the
contract, on which the plaintiff is suing, need not be a contract in
writing. It may even be an implied contract. But so long as there is a
debt or liquidated demand which becomes payable under such a
contract, the plaintiff is entitled to sue for the amount due under
the contract.
21. Mr. Choudhary submitted that the Full Bench Judgment in
the case of Jyotsna Valia (supra) does not govern the facts of the
case. The decision in the case of Purnima Jaitly vs. Ravi Bansi
Jaisingh3 rendered by a learned single Judge can be said to be per
incuriam the Division Bench Judgment in the case of Gokuldas
Poddar (supra).
22. Mr. Choudhary, would further urge that the email dated 18 th
March, 2020 constitutes a clear acknowledgment. The demand for
2 1954 (ILR) Bombay Series 507.
3 2004(1) Mh.L.J. 114.
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the refund of the amount of the paid up share capital, implies that
the defendant had borrowed the amount from the plaintiff to
finance the acquisition of the shares. To this end, Mr. Choudhary
placed reliance of the judgment in the case of State of Kerala vs.
T.M. Chacko4.
23. In the said case, in the context of the provisions contained in
section 18 of the Limitation Act, the Supreme Court enunciated that
to treat a writing signed by the party as an acknowledgment, the
person acknowledging must be conscious of his liability and the
commitment should be made towards that liability. It need not be
specific but if necessary facts which constitute the liability are
admitted, an acknowledgment may be inferred from such an
admission.
24. Lastly, Mr. Choudhary submitted that, having regard to the
fact that only 25% of the principal amount has been ordered to be
deposited, the impugned order, even otherwise, does not warrant
interference in exercise of the writ jurisdiction.
25. The aforesaid submissions now fall for consideration.
26. Evidently, the defendant and her husband Kamal and the
plaintiff have turned astray on account of the matrimonial dispute.
In the trail of marital discord a number of proceedings have been
filed. From a meaningful reading of the plaint, the substance of
4 (2000) 9 Supreme Court Cases 722.
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which has been narrated above, in a little detail, it becomes
explicitly clear that the genesis of the instant dispute is also in the
marital discord, nay, in paragraph 4.10 of the plaint, the plaintiff
refers to the proceedings under the Protection of Women From
Domestic Violence Act, 2005 before the the Magistrate wherein her
son Kamal had purportedly placed on record the losses suffered in
the company, and, thereupon, the defendant tendered resignation
and demanded refund of the capital vide an email dated 18 th March,
2020.
27. The prayer for grant of an unconditional leave was thus
required to be appreciated keeping in view the aforesaid genesis of
the dispute.
28. Before adverting to deal with the submission as regards the
tenability of the suit in the present form as a summary suit, it may
be expedient to note few uncontroverted facts. It emerges from the
material on record that a sum of Rs. 13,23,000/- was transferred
from the account of plaintiff maintained with Kotak Mahindra
Bank, vide cheque No. 654, to an account No. 2111494617
maintained with Kotak Mahindra in the names of defendant and
Kamal Mirani, on 20th June, 2018. On the very day, the said amount
was transferred to the account of the company. Indisputably, the
defendant and Kamal were then cohabiting together.
Vishal Parekar, PS ...9
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29. The contentions of the defendant that at that point of time
Kamal was managing her affairs and even operated the said joint
account is required to be appreciated in the aforesaid backdrop.
30. The moot question that wrenches to the fore is, whether the
aforesaid transfer of the amount from the account of the plaintiff to
the joint account of the defendant and Kamal, evidenced by the
extracts of the bank accounts, constitute the debt or liquidated
demand in money covered by Rule 1(2) of Order 37 of the Code. Sub
rule (2) of Rule 1 of Order 37 reads as under:-
"(2) Subject to the provisions of sub-rule (1), the Order applies to
the following classes of suits. Namely:--
(a) suits upon bills of exchange, hundies and promissory notes;
(b) suits in which the plaintiff seeks only to recover a debt or
liquidated demand in money payable by the defendant, with or
without interest, arising,--
(i) on a written contract; or
(ii) on an enactment, where the sum sought to be recovered is
a fixed sum of money or in the nature of a debt other than a
penalty; or
(iii) on a guarantee, where the claim against the principal is in
respect of a debt or liquidated demand only.
(iv) suit for recovery of receivables instituted by any assignee
of a receivable."
31. In the facts of the case, clause (a) does not apply as the
plaintiff does not seek to recover the amount covered by the
instruments, enumerated therein. The plaintiff professedly claimed
to recover the debt or liquidated demand in money. Undisputedly,
there is no written contract. The endeavour of Mr.Choudhary was to
persuade the Court to hold that since the suit is based on debt or
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liquidated demand in money, absence of written contract, did not
matter. In contrast, it was the submission of Mrs. Singh that the
suit rests on honoured cheque and, therefore, it is beyond the
purview of sub rule (2) of Rule 1, Order 37 of the Code.
32. The Full Bench Judgment of this Court in the case of Jyotsna
Valia (supra) squarely addresses the controversy sought to be
raised in the instant case. In the said case, the Full Bench
considered the tenability of the suit based on various types of
documents, including an honoured cheque. The Full Bench held
that, a summary suit would not lie on "honoured cheque". The
observations in paragraph Nos. 26 and 27 are material and hence
extracted below:-
26] Reference may now be made to a judgment on honoured cheque, in
the case of Purnima Jaitly v. Ravi Bansi Jaisingh 2004(1) Mh.L.J. 114.
In that case, it was contended that a suit for recovery of loan which was
advanced by a Plaintiff by a cheque, would be a suit based on a bill of
exchange. Negating the said contention, the Court held that;
"It is true that a cheque is a bill of exchange, a special type of bill of
exchange which is drawn on a bank. However, a suit upon a cheque
(bill of exchange) means a suit to recover money due on a cheque (bill
of exchange) drawn by the defendant, which is dishonoured."
In such a case, the suit must be for recovery of money on a cheque
drawn in favour of or endorsed to the plaintiff. A suit, however for
recovery of a loan which was advanced by the plaintiff by a cheque is
not a suit upon a cheque or a bill of exchange and as such is not
maintainable as a summary suit. The contention of the Plaintiff that the
suit is upon a bill of exchange was rejected.
Reference may also be made to to the judgment in the case of The
Central Railway Employees Co-operative Credit Society v. Bank of
Baroda . In that case, the Plaintiff had issued crossed cheques for Rs.
1,75,000/- for short term deposit by the bank. The bank encashed the
cheque but the amount of cheque was siphoned by the bank officials. A
learned Single Judge whilst holding that a Summary Suit was
maintainable, held that the Plaintiff society seeks to recover a debt
payable by the Defendants bank with interest, arising on a written
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contract. The Court held that to hold otherwise, would be to cause loss
of faith and confidence of the business community and the ordinary
citizens in the banking system. This however was not a case of
honoured cheque.
27] From the above discussion it is clear that a summary suit would not
lie on a settled account which is not confirmed by the Defendant and
"on honoured cheque". Items (II) and (IV) of para 2 are answered
accordingly.
(emphasis supplied)
33. Mr. Choudhary made an earnest endeavour to distinguish the
aforesaid judgment on the premise that in view of the Bombay
Amendment to Order 37, the summary suit to recover the debt or
liquidated demand for money was maintainable. A brief legislative
history of Order XXXVII Rule 2 would be apposite.
A.... Order XXXVII Rule 2, as originally enacted read as under:-
"All suits upon bills of exchange, hundies and promissory notes,
may, in case the Plaintiff desires to proceed hereunder, be instituted by
presenting the plaint in the form prescribed, but the summons shall be
in Form No. 4 in Appendix B or in such other form as may be from
time to time prescribed."
B. The Bombay High Court amended Order XXXVII Rule 2(2) by a
notification on 29.9.1936. The rule read as under:-
(1) All suits upon bills of exchange, hundies or promissory notes, and
all suits in which the plaintiff seeks only to recover a debt or liquidated
demand in money payable by the defendant with or without interest,
arising on a contract express or implied, or on an enactment, where the
sum sought to be recovered is a fixed sum of money or in the nature of
debt other than a penalty, or on a guarantee, where the claim against
the principal is in respect of a debt or a liquidated demand only, or in
suits in which the landlord seeks to recover possession of immovable
property, with or without a claim for the rent or mesne profits against a
tenant whose term has expired or has been duly determined by notice
to quite, or as become liable to forfeiture for non-payment of rent or
against persons claiming under such tenant may in case the plaintiff
desires to proceed hereunder, be instituted by presenting a plaint in the
form prescribed, but the summons shall be in Form No. 4 in Appendix
B or in such other form as may be from time to time prescribed."
C. By a further amendment dated 1 st November, 1966 by Bombay High
Court, the provisions of Order XXXVII Rule 2 of the Code was
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substituted as under:-
"2. Institution of Summary suits upon bills of exchange, etc.--
(1) All suits upon bills of exchange, hundies or promissory notes, and
all suits in which the plaintiff seeks only to recover a debt or
liquidated demand in money payable by the defendant with or
without interest, arising on a written contract or on an enactment,
where the sum sought to be recovered is a fixed sum of money or in
the nature of a debt other than a penalty, or on a guarantee, where
the claim against the principal is in respect of a debt or a liquidated
demand only, may, in case the plaintiff desires to proceed hereunder,
be instituted by presenting a plaint with a specific averment therein
that the suit is filed under this Order, and that no relief not falling
within the ambit of this rule has been claimed, and with the
inscription within brackets "(Under Order XXXVII of the Code of
Civil Procedure, 1908)" just below the number of the suit in the title
of the suit, but the summons shall be in Form No. 4, in Appendix
or in such other form as may be from time to time prescribed.")
C. The Code of Civil Procedure, 1908, subsequently came to be
amended by CPC Amendment Act, 1976 :- The provisions of Order 37
Rule 1(2), as amended by CPC Amendment Act, 197,6 has been extracted
above.
34. From a careful perusal of the successive amendments, it
becomes evident that under the 1936 Amendment, the expression
used was, "a debt or liquidated demand in money payable by the
defendant with or without interest, arising on a contract express or
implied." However, under the 1966 Amendment, the expression
used was, "arising on a written contract". Two things, become clear.
First by 1966 Amendment, the word "written" was prefixed before
"contract". Second, the words "express or implied" which found
mention in 1936 Amendment, were deleted.
35. Thus, since 1966 amendment, the existence of a written
contract for a recovery of a debt or liquidated demand in money is a
Vishal Parekar, PS ...13
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pre-condition if the summary suit is to be instituted to recover a
debt or liquidated demand in money arising out of a contract. The
Full Bench in the case of Jyotsna Valia (supra) enunciated that
after 1996 Bombay Amendment and 1976 Amendment to the Code,
the summary suit can only be filed if there be a written contract.
The observations in paragraph 9 are material and hence extracted
below:-
9. The terminology used in the Bombay amendment and the 1976
amendment to the Code of Civil Procedure, is similar. In answering the
reference we shall consider the predicates of Order XXXVII under the
Bombay amendment. The said rule itself provides that the debt or
liquidated demand in money payable by the defendant, with or without
interest, must arise on a written contract.
The rule before the 1966 Bombay amendment and the 1976 Central
amendment to the Civil Procedure Code used the expression "arising on a
contract express or implied" and this was substituted by the words
"arising on a written contract". There can be therefore no dispute that
after the 1966 Bombay amendment and the 1976 amendment to the Civil
Procedure Code, the summary suit can only be filed if there be on a
written contract. In other words, no Summary Suit can lie on an implied
contract. There seems however some confusion as to the expression an
implied contract and "implied terms in a written contract". The
expression "implied term in a written contract" in law is distinct and
different from an implied contract. We will consider this aspect of the
matter whilst construing the legislative changes.
(emphasis supplied)
36. In view of aforesaid exposition of law, I find it rather difficult
to accede to the submission of Mr. Choudhary that a suit for
recovery of debt or liquidated demand in money, as such, is
maintainable even in the absence of a written contract. The reliance
by Mr. Choudhary on the decision in the case of Gokuldas Podar
(supra), is misplaced.
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37. In the said case, the Division Bench was considering the
position as it obtained before 1966 Bombay Amendment. At that
time, a summary suit to recover a debt or liquidated demand in
money arising on a contract, express or implied, was tenable. The
requirement of a written contract, and the deletion of the
expression, "express or implied" was the result of 1966 Bombay
Amendment, which position has since been continued under 1976
Amendment to the Code.
38. This propels me to the case based on the admission of liability.
A clear admission of liability in writing may not present much
difficulty. However, an acknowledgment of liability may be asserted
in myriad forms. In such a situation, the nature of the document
under which the defendant is alleged to have acknowledged debt or
liability assumes critical salience. The Court has to pose unto itself
a question, as to whether the document pressed into service as an
acknowledgment in writing constitutes the acknowledgment of the
debt or liability ?
39. Reverting to the facts of the case, in my considered view, the
communication dated 18th March, 2020, could not have been read
torn out of context and de hors the genesis of the dispute between
the parties. Two factors assume significance.
40. One, the relationship between the parties, when the amount
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was transferred from the account of defendant and Kamal.
41. In this context, the defendant has categorically asserted that
Kamal was in control of her account as well and the corporate
entity Kamya Forex and Gold India Private Limited. As noted
above, the amount was instantaneously transferred from the joint
account of the defendant and Kamal to the account of the said
company. The defendant has, thus, as noted by the learned Judge
also, raised a triable issue as to whether the said borrowing from
the plaintiff and transfer thereof to the account of the company, was
out of the own volition of the defendant.
42. Two, by an order dated 24 th August, 2022 in Notice of Motion
No. 2717 of 2021, the City Civil Court had declined to pass a decree
on admission on the basis of the very email dated 18th March, 2020.
The defendant has also explained the circumstances in which she
was constrained to address the said communication to Kamal,
namely the stand of Kamal in a proceeding under the Domestic
Violence Act, 2005 that he had suffered loss in the said venture.
Thus, the resignation from the post of the Director of the company
and the demand for the refund of the share capital ought to have
been appreciated in the aforesaid context.
43. At any rate, once the defendant raises a triable issue,
ordinarily, an unconditional leave to defend the suit ought to be
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granted. A useful reference, in this context can made to the
judgment of the Supreme Court in the case of B. L. Kashyap and
Sons Ltd. vs. M/s. JMS Steels and Power Corporation and Another 5,
In the said case, the Supreme Court culled out the principles in
paragraph 33.3 as under:-
33.3] Therefore, while dealing with an application seeking leave to
defend, it would not be a correct approach to proceed as if denying the
leave is the rule or that the leave to defend is to be granted only in
exceptional cases or only in cases where the defence would appear to
be a meritorious one. Even in the case of raising of triable issues, with
the defendant indicating his having a fair or reasonable defence, he is
ordinarily entitled to unconditional leave to defend unless there be any
strong reason to deny the leave. It gets perforce reiterated that even if
there remains a reasonable doubt about the probability of defence,
sterner or higher conditions as stated above could be imposed while
granting leave but, denying the leave would be ordinarily
countenanced only in such cases where the defendant fails to show any
genuine triable issue and the Court finds the defence to be frivolous or
vexatious.
(emphasis supplied)
44. The conspectus of aforesaid consideration is that the
defendant deserves an unconditional leave to defend the suit. In the
facts of the case at hand, a direction for deposit of even 25% of the
sum of Rs. 13,23,000/- operates onerously, if viewed through the
prism of the situation in life of the defendant. I am, therefore,
impelled to interfere with the impugned order.
Hence, the following order.
ORDER
1}The petition stands allowed.
5 (2022) 3 Supreme Court Cases 294.
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2} The impugned order granting conditional leave to defend the suit
stands quashed and set aside.
3} Unconditional leave to defend the suit is granted to the
defendant.
4} The amount of Rs. 2,00,000/-, deposited by the petitioner-
defendant pursuant to the order dated 13 th November, 2024, be
refunded to the defendant along with interest accrued thereon.
5} Rule made absolute in the aforesaid terms.
6} No costs.
Petition disposed.
(N. J. JAMADAR, J.)
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