M/S Shree Glass Traders vs M/S Lakshmi Float Glass Ltd.
2008 Latest Caselaw 1452 Del

*                HIGH COURT OF DELHI : NEW DELHI

                     Date of Order: 27th August 2008

+                          R.F.A. No. 88/2008

M/S SHREE GLASS TRADERS                   ..... Appellant
              Through Mr. Rakesh Malhotra, Advocate

                      versus


M/S LAKSHMI FLOAT GLASS LTD             ..... Respondent
                   Through Mr. T.L. Aggarwal, Advocate

CORAM:

HON'BLE MR. JUSTICE PRADEEP NANDRAJOG
HON'BLE MR. JUSTICE SUNIL GAUR

1.   Whether the Reporters of local papers may
     be allowed to see the judgment?

2.   To be referred to Reporter or not?

3.   Whether the judgment should be reported
     in the Digest?

PRADEEP NANDRAJOG, J.

1. Heard learned counsel for the parties for final disposal.

Record has been perused.

2. The respondent was the plaintiff. Suit under Order 37 of

the Code of Civil Procedure was filed praying for a decree in

sum of Rs.4,31,310/- with interest @ 18% per annum till

realization. The cause pleaded in the plaint and additionally

made relatable to a suit under Order 37 of the Code of Civil

Procedure, was as pleaded in para 3 of the plaint which reads

as under :-

R.F.A. No. 88/2008 Page | 1 "That the defendant above named drew, issued and delivered a cheque No.981256 dated 20.09.2001 for a sum of Rs.4,11,36/- only, drawn upon Corporation Bank, Palam, New Delhi, in favour of the plaintiff company, towards the payment of the amount due from the defendant to the plaintiff company on account of purchases made by the defendant from the plaintiff company between the period from 05.12.1998 to 14.12.1998 against their bills as stated in the statement of account filed herewith."

3. Alleging that the cheque was dishonoured and returned

by the banker on which it was drawn with the remarks

„‟insufficient funds'' this suit was filed.

4. Appellant who was impleaded as the sole defendant being

the drawer of the cheque filed an application seeking leave to

defend when it was served with the summons of the suit in the

prescribed form as contemplated by Order 37 Rule 2(2) of Code

of Civil Procedure.

5. The appellant departured from the procedure prescribed

under Order 37 requiring appellant to first enter appearance

and file in the court an address for service of the notice of

summons for judgment. Thus, it is obvious that summons for

judgment were not taken out.

6. Seeking leave to defend, appellant projected the triable

issues which according to appellant would arise on the defence

available and if established would non suit the respondent.

R.F.A. No. 88/2008 Page | 2

7. With reference to the averments made in para 2 of the

plaint the attention of the learned trial Judge was drawn to the

statement of account filed by the plaintiff, which revealed that

between 5.12.1998 to 14.12.1998 i.e. the dates mentioned in

para 2 of the plaint, the appellant had received goods worth

Rs.3,07,604/-. With reference to the same statement of

account, it was pointed out that as recorded by the respondent

in the said statement, it had received Rs.57,079/- from the

appellant during said period meaning thereby, even as per the

statement of account filed by the respondent for the period

5.12.1998 to 14.12.1998 amount payable would be

Rs.2,50,522/-.

8. It was further pointed out that on 16.10.1999, the

respondent had itself issued a Credit Note in favour of the

appellant in sum of Rs.62,120/- and on 25.3.1999 and

25.12.1999, vide cheque No.862417 and 464787 the

respondent had received Rs.50,000/- and Rs.31,327/-

respectively. Thus it was pleaded that the appellant would be

entitled to further adjustment of Rs.1,43,447/-. Subtracting the

said amount from Rs.2,50,525/-, liability to pay Rs.1,07,078/-

was admitted.

9. Pertaining to the cheque in question, it was averred that

since parties recommence business after a long interval,

R.F.A. No. 88/2008 Page | 3 appellant had issued 6 blank cheques, 1 of which was alleged

to have been used. It was pleaded that the cheque in question

is dated 20.9.2001. The difference in the ink used to sign the

cheque and to fill up the cheque was also highlighted.

10. In the reply filed by the respondent to the application

seeking leave to defend the respondent sought to rely upon

acknowledgement purportedly executed by the appellant on

16.1.1999 and 8.6.2001.

11. Learned trial Judge has penned 2 orders of even both

dated 27.10.2005 decreeing the suit. By the first order dated

27.10.2005, it has been noted that since the appellant did not

file the memo of appearance required to be filed as per the

provisions of Rule 3 of Order 37, the suit had to be decreed. So

holding, suit was decreed but not as prayed for. Interest

awarded is @ 9% per annum.

12. By the second order of even date i.e. 27.10.2005, the

merits of the application seeking leave to defend has been

considered and rejected holding that since the appellant had

not disputed the balance confirmation made by him for

5.12.1998 to 14.12.1998 no triable issue arose for

consideration.

13. The findings of the learned trial Judge stands summarized

R.F.A. No. 88/2008 Page | 4 in para 6 of the order dated 27.10.2005 which reads as under:-

"In the present case the defence raised by the defendant that he has given the blank cheques without any consideration is not plausible at all particularly when the defendant has not disputed the balance confirmation made by him on dated 05.12.1998 to 14.12.1998 on the statement of claim. Even otherwise the perusal of the cheque apparently does not show any forgery thus I am of the considered opinion that the defence raised by the defendant in case of Mrs. Raj Duggal Vs. Ramesh Kumar Balsal, and Jashbhai Motibhai Patel Vs. Hasmukhbhai Ravjibhai Patel, do not render any help. In the facts and circumstances of the case and the judgment referred by the counsel for the plaintiff, I am of the confirmed opinion that the defendant is not entitled for the grant of leave to defend. The application is hereby dismissed."

14. Suffice it would be state that appellant had, with

reference to the statement of account filed by the respondent,

drawn attention of the court to the transactions transacted

between the parties from 5.12.1998 to 14.12.1998 and had

clearly pleaded, plea being made good with reference to the

respondent‟s own document i.e. statement of account, that

between said period it had purchased goods worth only

Rs.3,07,604/-. Thus, prima facie the cheque in question could

not relate to the payments due for purchases made between

5.12.1998 to 14.12.1998.

R.F.A. No. 88/2008 Page | 5

15. Further, as noted above, respondent‟s statement of

account revealed that it had received Rs.57,079/- during

aforesaid period and as noted above subsequently it had

received further payments by two cheques and had issued a

credit note, total adjustment value whereof would come to

Rs.1,42,447/-.

16. We note that the suit filed by the respondent nowhere

refers to a written acknowledgement. As noted hereinabove,

the cause of action pleaded in the suit is the cheque and

nothing else.

17. Prima facie, the application seeking leave to defend does

project a defence which if successful would non suit the plaintiff

save and except in sum of Rs.1,07,078/-.

18. Learned Counsel for the appellant states that the

appellant is prepared to pay to the respondent sum of

Rs.1,07,078/-.

19. Pertaining to the first order dated 27.10.2005, decreeing

the suit in absence of a memo of appearance filed, suffice

would it be to state that the legislature intend requiring memo

of appearance to be filed by a defendant who was sued under

Order 37 of the Code of Civil Procedure to fast track service of

summons for judgment on the given address. Only thereafter

R.F.A. No. 88/2008 Page | 6 an application seeking leave to defend has to be filed. Thus, by

filing an application seeking leave to defend without awaiting

service of summons for judgment would not mean that the suit

has to be decreed.

20. The procedural laws are intended to be subserved to the

cause of substantive justice provided no prejudice is caused to

the opposite party.

21. The appeal is accordingly stands disposed of setting aside

both impugned orders dated 27.10.2005. The consequential

decree passed in the suit is also set aside.

22. Appellant‟s application seeking leave to defend is allowed

but subject to the condition that within 3 weeks from today,

appellant would deposit Rs.1,07,078/- with the learned trial

Judge which amount would be permitted to be withdrawn by

the respondent unconditionally for the reasons the appellant

admits said amount to be payable.

23. The appellant shall file a written statement within 6 weeks

from today with advance copy to learned counsel for the

respondent.

24. Parties are directed to appear before the learned trial

Judge who would revive the suit and proceed in accordance

with law; appearance would be made by the parties before the

R.F.A. No. 88/2008 Page | 7 learned trial Judge on 10.09.2008.

25. A copy of this order shall be supplied dasti by the registry

to learned counsel for the parties on payment of usual charges.

26. Registry shall ensure that the trial court record is returned

through a special messenger within a week so that it is

available before the learned trial Judge well before 10.09.2008,

the date notified for the parties to appear before the learned

trial Judge.

27. Before concluding, we may note that nothing stated

herein would be construed as an expression on the merits of

the controversy between the parties. We have considered the

submissions and the pleadings limited on the question whether

the defence raises a tribal issue which if succeeds would non

suit the respondent.

28. No costs.

                                  PRADEEP NANDRAJOG,J



                                  SUNIL GAUR, J
AUGUST         27, 2008
dkg




R.F.A. No. 88/2008                                              Page | 8