Delhi High Court
Shri Vivek Gupta vs Shri Vikram Dev Malhotra & Anr. on 4 December, 2009
Author: Shiv Narayan Dhingra
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Reserve: November 23, 2009
Date of Order: December 04, 2009
+IA 10672 of 2009 in CS(OS) 923 of 2008
% 04.12.2009
Shri Vivek Gupta ...Plaintiff
Through: Mr. Sanat Kumar and Ms. Poonam Gulia, Advocates
Versus
Shri Vikram Dev Malhotra & Anr. ...Defendants
Through: Mr. Joginder Sukhija and Mr. Ajay Jain, Advocate
JUSTICE SHIV NARAYAN DHINGRA
1. Whether reporters of local papers may be allowed to see the judgment?
2. To be referred to the reporter or not?
3. Whether judgment should be reported in Digest?
ORDER
1. Plaintiff filed this suit under Order 37 of Civil Procedure Code for a sum of
Rs.31,75,000/- stating therein that plaintiff advanced a sum of Rs.25 lac to defendants
no.1 and 2. Rs. 20 lac was given by way of account payee cheques drawn on State Bank
of India dated 21st September 2006 and 23rd September 2006 and Rs.5 lac was given cash.
The cheques were drawn in favour of a firm M/s Tini Craft and defendants no.1 and 2
being the partners of the firm M/s Tini Crafts were jointly and severally liable to pay back
the amount. Defendants issued a cheque dated 30th November 2006 drawn on ICICI Bank
for a sum of Rs.25 lac towards the dues of plaintiff and assured plaintiff that they will pay
interest by way of separate cheque next month. The cheque of Rs.25 lac was duly
presented by plaintiff to its banker for encashment. However, the cheque got dishonoured
twice due to insufficiency of funds. Plaintiff thereafter filed a complaint under Section
138 of Negotiable Instruments Act. After filing of complaint, defendant no.1 issued a
CS(OS) 923 of 2008 Vivek Gupta v. Vikram Dev Malhotra & Anr. Page 1 Of 4
cheque of Rs.10 lac to the plaintiff assuring that the cheque was towards part payment
and shall be honoured. This cheque was also dishonoured by the bank of defendants as
the defendants stopped payment. Plaintiff filed another complaint case under Section 138
of the Negotiable Instruments Act against defendant no.1 who had issued the cheque.
Plaintiff filed the present suit for recovery of the due amount. Plaintiff has placed on
record the copy of dishonoured cheque of Rs.25 lac with a copy of cheque returning
memo as well as a copy of dishonoured cheque of Rs.10 lac. Plaintiff also served a legal
notice on defendants seeking return of Rs.25 lac along with interest @ 18% per annum.
Plaintiff has placed on record the statement of account maintained by it in respect of
defendant no.3 M/s Tini Craft, Goa which shows that Rs.25 lac was paid to defendant
M/s Tini Craft.
2. By way of present application for leave to defend, defendants have not disputed
taking of a loan from plaintiff and took a stand that the loan was not advanced to
defendant no.1 but was advanced to defendant no.3 M/s Tini Craft and defendant no.1
was not a partner of defendant no.3. The other stand taken is that the plaintiff had settled
all their disputes with defendants and against a loan of Rs.25 lac, plaintiff had agreed to
accept only Rs.10 lac as full and final settlement. However, plaintiff was to withdraw all
legal proceedings against defendants and a cheque of Rs.10 lac was issued by defendant
no.1 in terms of this settlement. However, this cheque was to be encashed by plaintiff
after withdrawal of all legal proceedings. The plaintiff did not withdraw the legal
proceedings, therefore, payment of cheque was stopped.
3. Another defence taken is that in discharge of the loan a sum of Rs.14 lac was
repaid in cash without obtaining any receipt and hence the loan was discharged.
CS(OS) 923 of 2008 Vivek Gupta v. Vikram Dev Malhotra & Anr. Page 2 Of 4
4. During arguments, the counsel for defendants submitted that this Court had no
territorial jurisdiction since all the defendants were residents of Goa. The other argument
is that the defendant no.3 was a proprietorship firm and defendant no.1 was not a partner.
5. In my view, the different stands taken by defendants in the leave to defend
application are merely moonshine. The cheque of Rs.25 lac issued by defendants after
taking loan from plaintiff has the names of both the defendants no.1 and 2 printed over it
and if the firm M/s Tinni Craft had been a proprietorship firm, the cheque would not have
had the names of two defendants i.e. defendants no.1 and 2 printed over it. This only
shows that account of M/s Tinni Craft was being managed by both the defendants no.1
and 2 and they were joint proprietors of M/s Tinni Craft. Even otherwise, defendants have
not placed on record constitution of M/s Tinni Craft to show that M/s Tinni Craft was a
proprietorship firm. It is defendant no.1 who admittedly issued another cheque of Rs.10
lac, towards discharge of the loan which also got dishonoured. I, therefore, consider that
plea of defendant no.1 that he was not concerned with M/s Tinni Craft is baseless.
6. The arguments on the issue of territorial jurisdiction also does not hold ground. A
perusal of plaint would show that the loan was advanced in Delhi and the cause of action
arose in Delhi.
7. The plea of settlement having been arrived at with the plaintiff of discharge of
entire loan liability by accepting Rs.10 lac, is belied by the other averments made in the
leave to defend application wherein it is stated by defendants that they had paid back
Rs.14 lac in cash without mentioning the dates and amounts when this Rs.14 lac was paid
CS(OS) 923 of 2008 Vivek Gupta v. Vikram Dev Malhotra & Anr. Page 3 Of 4
back. I, therefore, consider that this plea is also not tenable.
8. The defence raised by defendants in the leave to defend application are false and
sham defence and a totally moonshine and the defendants are not entitled to leave to
defend and the plaintiff on the other hand is entitled for a decree. The application of
defendants for leave to defend is hereby dismissed.
7. Plaintiff has claimed interest @ 18% per annum over the principal amount of
Rs.25 lac. I consider that since there was no agreement of interest between the parties, the
plaintiff is entitled to only to a reasonable rate of interest. Considering the present
scenario of rate of interest, interest @ 8% per annum would be a reasonable rate of
interest.
8. I, therefore, allow the suit filed by plaintiff. The suit is hereby decreed for a sum
of Rs.25 lac as principal amount and interest @ 8% per annum on the principal amount
from the date of loan till filing of the suit and interest @ 8% per annum on the amount so
accrued upto the date of filing suit would be payable till realization. Decree sheet be
drawn accordingly.
December 04, 2009 SHIV NARAYAN DHINGRA J.
rd
CS(OS) 923 of 2008 Vivek Gupta v. Vikram Dev Malhotra & Anr. Page 4 Of 4
