M/S Financial Eyes (India) Ltd vs Sh Bijender Chauhan @ Bijender ...
2014 Latest Caselaw 5665 Del

$-42
*       IN THE HIGH COURT OF DELHI AT NEW DELHI

+         RFA(OS) 149/2013 & C.M. Appl. No.19141/2013 (stay)

%                         Date of decision : 11th November, 2014

       M/S FINANCIAL EYES (INDIA) LTD            ..... Appellant
                     Through: Mr. Raman Kapur, Senior Advocate
                               with Mr. Dheeraj Sachdeva, Advocate

                         versus

       SH BIJENDER CHAUHAN
       @ BIJENDER KUMAR                                  ..... Respondent
                     Through:         Mr. Avinash Trivedi, Advocate with
                                      respondent in person

       CORAM:
       HON'BLE MS. JUSTICE GITA MITTAL
       HON'BLE MR. JUSTICE J.R. MIDHA

GITA MITTAL, J. (Oral)

1. We have heard learned counsel for the parties. The appellant has assailed the judgment dated 23rd July, 2013 whereby the I.A. No.5269/2012 in CS(OS) 2576/2011 under Order XXXVII Rule 3(5) of the Code of Civil Procedure filed by the appellant (defendant therein), seeking leave to defend and contest the suit under Order XXXVII CPC was rejected. As a result, the respondent-plaintiff's suit had been decreed for the sum of Rs.30,97,959/- in favour of the respondent with pendente lite and future interest @ 10% per annum and costs of the suit.

2. The present appeal has been pressed before us on all grounds which

were urged before the learned Single Judge as well. It has additionally been contended that the plaintiff's suit was premised on goods supplied between 2nd April, 2010 to 05th January, 2011. The goods were of the nature of jute bags, which were admittedly to be utilised for the purposes of packaging rice with which the appellant exports. The impugned judgment notices that the appellant was placing reliance on the first customer complaint received by it on 02nd December, 2010 with regard to the quality of the bags supplied by the respondent and that the appellant had, as a result, informed the respondent by the letter dated 15th December, 2010 with regard to the poor quality of the bags.

3. Mr. Raman Kapur, learned senior counsel for the appellant, has vehemently urged before us that the appellant has acted bona fide given the nature of the goods which was involved and that the reliance placed on Sections 41 and 42 of the Sale of Goods Act, 1932 was not warranted. It is urged that the goods were used for packaging material and exporting them to different countries including Jordan, Canada etc. by the sea routes. It is further submitted that the appellant-defendant had placed sufficient material on record to illustrate that after the goods were supplied the matter of filling the bags; shipping them and discovery of their defective quality was time consuming and could be ascertained only when the exported rice actually reached the destination. In this background it is urged that the finding of the Single Judge that supplies were effected with effect from April, 2010 and that the first complaint was made in December, 2010 was erroneous. In fact, it is urged by Mr. Raman Kapur, learned senior counsel for the appellant, that the appellant had a counter claim against the respondent.

4. The impugned judgment is assailed on several other aspects. However, in our view, given the factual matrix of the case, the defendant cannot be disbelieved on the ground that his defence was unreasonable. It is also not possible to hold, at this stage, without any evidence on record that the defence was not fair or was mala fide.

5. Our attention is also drawn to the pronouncement of the Supreme Court reported in AIR 1977 SC 577 M/s Mechalec Engineers & Manufacturers v. M/s Basic Equipment Corporation, wherein the Supreme Court has held that even if the defendant had no defence or the defence is illusory or sham or practically moonshine, then the Court could protect the plaintiff by only allowing the defence to proceed if the amount claimed is paid into Court or otherwise secured and then to give leave to the defendant on such condition, thereby showing mercy to the defendant by enabling him to try to prove his defence. In our view, such a course of action would amply balance equities in the present case.

6. In view of the above, we direct as follows:

(i) The judgment and decree dated 23rd July, 2013 as well as the order passed in I.A. No.5269/2012 are hereby set aside.

(ii) Subject to deposit of the sum of Rs.30,97,959/- within six weeks from today with the Registrar General of this Court in CS(OS) 2576/2011 the appellant is granted leave to defend the suit.

(iii) Upon deposit of the said amount, the Registry shall release 50% of the deposited amount to the respondent (plaintiff in the suit) against an undertaking from the respondent-plaintiff that in case the suit is dismissed, the respondent-plaintiff shall pay the amount to the

defendant with interest at a rate which the learned Single Judge would specify at the time of final adjudication.

(iv) The remaining amount shall be kept in a fixed deposit receipt initially for a period of one year, which fixed deposit shall be kept renewed till further orders of the learned Single Judge.

(v) The defendant shall file its written statement in CS(OS) 2576/2011 and counter claim, if any, within four weeks from today. The plaintiff may file his replication and written statement to the counter claim, if any within four weeks thereafter. The defendant may file its replication in the counter claim within a further period of four weeks thereafter. Documents, if not already filed, shall be filed with the respective pleadings.

(vi) The parties shall appear before the concerned Joint Registrar (Original) on 19th March, 2015 for admission/denial of documents. The matter shall be listed before the Court for framing of issues on 19th May, 2015.

This appeal is allowed in the above terms.

GITA MITTAL, J

J.R. MIDHA, J NOVEMBER 11, 2014 rsk