Calcutta High Court
For The vs Solanki Traders) To Submit As To on 15 November, 2022
ORDER SHEET
ODC-7
IN THE HIGH COURT AT CALCUTTA
ORDINARY ORIGINAL CIVIL JURISDICTION
[COMMERCIAL DIVISION]
IA No. GA/5/2022
In
CS/23/2021
MICKY METALS LIMITED.
VERUS
SUDIP TEWARY
BEFORE:
The Hon'ble JUSTICE ARINDAM MUKHERJEE
Date: 15th November, 2022.
Appearance:
Mr. Rupak Ghosh, Adv.
Mr. Debraj Shau, Adv.
Mr. Abhijit Sarkar, Adv.
For the Plaintiff/Petitioner.
Mr. Rahul Karmakar, Adv.
Mr. Asif Sohail Tarafdar, Adv.
For the Defendant/Respondent.
The Court :- In a suit for alleged unpaid price of goods, sold and
delivered this application has been taken out by the plaintiff, inter alia, for
judgment upon admission with prayer for attachment before judgment and
furnishing of security.
The plaintiff says that the defendant in discharge of its obligation to pay
the price of the goods, sold and delivered by the plaintiff to the defendant had
issued two cheques respectively of Rs. 39,38,507/- and Rs. 33,97,515/-
aggregating to Rs. 73,36,022/-. The said two cheques were drawn on Axis Bank
Ltd at Chandrakona Branch bearing Nos. 003251 and 003252 respectively. One
of the cheques is dated 11th August, 2017 and the other is dated 11th December,
2017. The cheque bearing No. 003251 was dishonoured as there was an
instruction of "payment stopped". The cheque bearing No. 003252 appears to
have been dishonoured on the ground that the "drawer signature differs". The
plaintiff further says that issuance of cheque pursuant to goods being sold and
delivered which were dishonoured on being presented for encashment amounts
to admission of liability and as such the plaintiff is entitled to judgment upon
admission.
On behalf of the defendant it is submitted that the two cheques were
given long back by the defendant towards security as the plaintiff and the
defendant had business transactions for a considerable period of time i.e. around
2006. These cheques having been given as security were not meant to be
presented at the bank for encashment. No intimation was also given to the
defendant about the presentation of the aforesaid two cheques prior to the same
being presented. The defendant also says that no goods were delivered by the
plaintiff for which the defendant had issued the said two cheques in discharge of
his obligation. The invoices relied upon by the plaintiff in support of the unpaid
price of goods, sold and delivered does not contain any receipt endorsement from
the defendant and as such it should be construed that no supply in terms of
such invoices was made to the defendant by the plaintiff and as a consequence
whereof the defendant had no obligation to pay for which the cheques were
issued. The defendant further says that all payments to the plaintiff on account
of price of goods, sold and delivered had been made by Real Time Gross
Settlement (RTGS) and that no payment for price was through cheques. The said
two cheques were made over to the plaintiff long back as security which fact
would be established from the cheque booklets issued by the bank to the
defendant and the nos. of the two cheques. The defendant also says that the
plaintiff has initiated proceedings under Section 138 of the Negotiable Instrument
Act, 1881 before the Court of Learned Chief Metropolitan Magistrate, Calcutta
and the defendant is contesting the same. The issue as to non-supply goods is
the main point in the evidence adduced till yet. The defendant says until the said
criminal proceedings is brought to a logical conclusion it cannot be said that
goods were actually delivered for which the cheques were issued. The defendant,
therefore, says that the two cheques even though have been dishonoured cannot
be construed to have been issued against admission of liability. The defendant
also says that no case for providing security has been made out by the plaintiff in
its application. The defendant cites a judgment reported in 2008 (2) SCC 302
(Raman Tech & Process Engg. Co. & anr.-Vs- Solanki Traders) to submit as to
when attachment before judgment under Order 38 Rule 5 of the Code of Civil
Procedure, 1908 can be made. Last but not the least the defendant says that the
application is not in proper form.
After hearing the parties and considering the materials on record, I find
that there is no such admission as required under the provisions of Order XII
Rule 6 of the Code of Civil Procedure, 1908 to grant a judgment upon admission
to the plaintiff. The admission contended is by issuance of cheque for price of
goods sold and delivered which got dishonoured. There may be various
possibilities for issuance of cheque which cannot be finally gone into without
evidence being adduced. The plaintiff has pleaded the accounts between the
plaintiff and the defendant to be current and continuous account with mutual
dealings. It is, therefore, not clear at this stage against discharge of which
liability the two cheques, which were subsequently dishonoured, were issued.
The defendant has also been equally unable to demonstrate even prima facie that
the cheques were not issued in discharge of any obligation. There is no document
to prima facie demonstrate that two dishonoured cheques were issued as security
as alleged by the defendant. The defendant has also not been, prima facie, able to
demonstrate that the grounds taken by it to oppose the application had been
even in miniscule form taken in the reply to the notice under Section 141 of the
Negotiable Instrument Act, 1881 which according to the defendant was his first
knowledge regarding the alleged supply and dishonour of cheque said to have
been given as security. Only because the invoices do not bear the receipt
signature it cannot be held at this stage once the cheques had been issued which
got dishonoured that goods were not supplied by the plaintiff, particularly when
the long standing trading relationship is admitted.
In the aforesaid backdrop it cannot be said at this stage that the Court
is not required to wait for determination of any other question between the
parties, but at the same time the chain of events i.e. long standing trading
relationship, supply of material by the plaintiff and payment thereof by the
defendant and that the cheques were issued by the defendant which got
dishonoured gives a prima facie impression that goods were sold and delivered by
the plaintiff and for the payment of such price the cheques were issued. This
prima facie view is further strengthened on the defendant being unable to show
any document in support of its claim and contention. It is also well settled legal
position that a criminal proceedings under Section 138 of the Negotiable
Instruments Act, 1881 and a civil suit for recovery of the money covered by the
dishonoured cheque can proceed parallaly. There is no dispute as to the
conditions to be fulfilled for granting attachment before judgment as laid down in
Raman Tech (supra) but the view to direct security has undergone a sea change
in cases of commercial disputes in the light of the judgment reported in (2021) 6
SCC 418 (Rahul. S. Shah-Versus-Jinendra Kumar Gandhi) and in particular
paragraph 42.7 thereof. I am, therefore, inclined to direct providing of security in
exercise of powers under Section 151 of the Code of Civil Procedure, 1908 even if
the provisions as laid down for attachment before judgment in Raman Tech
(supra) may not be fulfilled after holding that the plaintiff is not entitled to
judgment upon admission in the facts and circumstances of the case. The
defendant is directed to deposit a sum of Rs. 73,36,022/- with the Registrar,
Original Side of this Court by 15th December, 2022 in order to enable the
defendant to contest the suit, failing which there will be an automatic decree of
the said sum against the defendant in favour of the plaintiff.
The application being IA No. GA/5/2022 is, accordingly, disposed of.
(ARINDAM MUKHERJEE, J.)
snn
