Ashok Kumar Tiwari vs Rajesh Kumar Yadav
2016 Latest Caselaw 3326 Del

          *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                         Date of decision: 6th May, 2016

+                                 RFA No.94/2015
       ASHOK KUMAR TIWARI                       ..... Appellant
                  Through: Mr. K. N. Jayasankar & Mr. J.L. Joel,
                           Advs.

                                    Versus

    RAJESH KUMAR YADAV                       ..... Respondent

Through: Mr. Amit Kumar, Adv. for R-1 CORAM:-

HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1. This first appeal under Section 96 of the Code of Civil Procedure, 1908

(CPC) impugns the judgment and decree dated 26th November, 2014 of the

Court of the Additional District Judge (ADJ)-03, South East, Saket Courts,

New Delhi decreeing CS No.306/14 filed by the respondent/plaintiff under

Order 37 of the CPC for recovery of Rs.3.10 lacs with pendente lite and future

interest at 24% per annum against the appellant/defendant consequent to

dismissal of the application filed by the appellant/defendant for leave to defend

as barred by time (of one day).

2. The appeal came up before this Court on 20th March, 2015 when the

counsel for the respondent/plaintiff being on caveat also appeared. Vide

subsequent order dated 7th August, 2015, subject to the appellant/defendant

depositing a sum of Rs.1,30,000/- in this Court, execution of the decree was

stayed and the trial court record requisitioned.

3. Admit.

4. Considering that in the event of the appeal being allowed, the suit will

have to be remanded for decision in accordance with law, with consent, the

counsels have been finally heard on appeal.

5. The respondent/plaintiff on 12th May, 2014 instituted the suit from which

this appeal arises, pleading (i) that the respondent/plaintiff keeping in view the

friendly relations with and the genuine need and requirement of the

appellant/defendant, during the period of February, 2010 to April, 2010

advanced a total sum of Rs.3,10,000/- in cash to the appellant/defendant;

however no receipt was executed since it was a friendly loan and the

appellant/defendant assured to return the loan within a period of one year; (ii)

that when the respondent/plaintiff raised a demand, the appellant/defendant in

discharge of his liability issued two cheques both dated 10th May, 2011, one for

Rs.1,80,000/- and another for Rs.1,30,000/- respectively in favour of the

respondent/plaintiff; that the appellant/defendant had assured and promised that

the said cheques on presentation would be encashed; (iii) however on

presentation the said cheques were dishonoured for the reason of insufficiency

of funds in the account of appellant/defendant and the respondent/plaintiff was

informed of the said dishonour on 20th May, 2011 and 16th May, 2011

respectively; and, (iv) that the respondent/plaintiff repeatedly called upon the

appellant/defendant to make payment but to no avail and ultimately got issued

legal notices dated 10th June, 2011 and 8th June, 2011 but the

appellant/defendant neither made the payment nor replied.

6. Summons for appearance were issued and upon the appellant/defendant

entering appearance, vide order dated 29th August, 2014 summons for judgment

were ordered to be issued to the appellant/defendant and the suit adjourned to

16th October, 2014 for report and consideration. On 16th October, 2014, the

appellant/defendant appeared in person and filed an application for permission

for filing leave to defend. The said application was dismissed observing that it

was the right of a defendant to seek leave to defend within the prescribed

period and the suit posted for consideration on 17th October, 2014.

7. On 17th October, 2014, the counsel for the appellant/defendant appeared

and submitted an application for leave to defend but not supported with detailed

affidavit, inter alia on the grounds (i) that he had never taken any loan from the

respondent/plaintiff and the cheques were never given against any

consideration and were taken by the respondent/plaintiff from the house of the

appellant/defendant without his permission and misused; (ii) that the

appellant/defendant however owes an amount of Rs.18,000/- to the

respondent/plaintiff; (iii) that the suit was time barred; the respondent/plaintiff

had put the date of issuance of the cheque as 10 th May, 2011 which meant that

the alleged loan become time barred on 10th May, 2014; the loan stated to have

been given before April, 2010 itself had become time barred; (iv) that the

respondent/plaintiff had already instituted two proceedings under Section 138

of the Negotiable Instruments Act, 1881 before the Courts at New Delhi and

Faridabad with respect to the said cheques; (v) that the original cheques had

also not been filed before the Court; and, (vi) that the respondent/plaintiff was

earning less than Rs.14,000/- per month and could not have given the loan of

Rs.3,10,000/-.

8. The respondent/plaintiff filed a reply to the aforesaid application for

leave to defend pleading (i) that the application for leave to defend had not

been filed within the prescribed time and was late by one day; (ii) denying that

he had taken the cheque without permission of the appellant/defendant and had

misused the same; and, (iii) the suit was within time and in fact the

appellant/defendant had turned dishonest.

9. No rejoinder was filed by the appellant/defendant inspite of opportunity.

10. The leaned ADJ in the impugned order with respect to the plea of

limitation in the application for leave to defend held that since the cheques were

presented on 16th May, 2011 and 20th May, 2011 and were dishonoured on the

same day, the limitation for institution of the suit for amount thereof was till

20th May, 2014 and the suit filed on 12th May, 2014 was within limitation. With

respect to the other pleas in the application for leave to defend, besides

observing that there was a delay of one day in filing the application for leave to

defend, it has also been reasoned that the appellant/defendant had nowhere

pleaded as to what he did after discovering that his cheques were missing i.e. he

did not file any criminal complaint or send any notice to the

respondent/plaintiff or give instructions to his banker for 'stop payment' as was

expected by a prudent person and thus his defence appeared to be afterthought,

very weak and not tenable.

11. Being prima facie of the opinion that irrespective of the delay of one day

on the part of the appellant/defendant in filing leave to defend, the suit claim as

per the averments in the plaint was barred by time, I have at the outset asked

the counsels to address on the aspect of limitation.

12. Though the counsel for the appellant/defendant had taken the plea of the

suit claim being barred by time but is unable to substantiate the same. The

counsel for the respondent/plaintiff also generally states that since the suit was

for recovery of the amount which was subject matter of cheques and had been

filed within the period of three years from the date of dishonour of the cheques,

the same was within time.

13. The suit though undoubtedly was for recovery of money which was the

subject matter of cheques which had been dishonoured but the consideration for

which the cheques were stated to have been issued was the friendly loan given

by the respondent/plaintiff to the appellant/defendant between February, 2010

to April, 2010. We have thus to see the limitation provided for a suit therefor.

Article 19 of the Schedule to the Limitation Act prescribes limitation of three

years commencing from the date when the loan is made for a suit for money

payable for money lent. It is further the plea of the respondent/plaintiff that the

appellant/defendant had assured to return the loan amount within a period of

one year. Though the loan is stated to have been made on different specified

dates between February, 2010 to April, 2010 but even if one year is taken from

the end of the month of April, 2010 and the period of limitation is counted

therefrom even then the period of three years would expire in April, 2014,

while the suit was instituted on 12th May, 2014. Thus the suit on the original

cause of action was barred by time. The respondent/plaintiff however relies on

cheques dated 10th May, 2011 given by the appellant/defendant in re-payment

of the said loan. The said cheques would be acknowledgment in writing of the

liability owed by the appellant/defendant to the respondent/plaintiff within the

meaning of Section 18 of the Limitation Act. However such acknowledgment

in writing would extend the period of limitation by three years but from the

date when the acknowledgment was so signed i.e. from the date of the cheque.

Once it is so, the said further period of limitation also would expire on 10 th

May, 2014 and the suit instituted on 12th May, 2014 would still be barred by

time.

14. I have recently in judgment dated 3rd May, 2016 in RFA No.208/2016

tilted Empire Home Appliances Private Limited Vs. M/S Suraj Enterprises

and other connected matters dealt in detail with the law on the said aspect and

need thus to discuss the same here is not felt and the same may be read as part

of this judgment.

15. In this light, the suit claim as per the averments in the plaint itself is

clearly barred by time and once that is so, irrespective of the

appellant/defendant having filed the application for leave to defend late, the suit

under Section 3 of the Limitation Act is to be dismissed as barred by time.

16. Even otherwise I am of the view that considering the fact that the

appellant/defendant had appeared before the learned ADJ on 16 th October, 2014

and moved an application for permission to file leave to defend and had filed

leave to defend on the very next date, the delay of one day in filing thereof

ought to have been condoned. Rule 3 (7) of Order XXXVII empowers the

Court to excuse the delay of the defendant in applying for leave to defend.

17. On merits also I am of the view that considering the fact that there was

no proof at all of the respondent/plaintiff having advanced any loan to the

appellant/defendant and the admitted fact of the friendly relations between the

parties, a case for grant of leave to defend, may be subject to condition of

deposit, was made out.

18. However since the suit claim has been found to be barred by time, no

purpose would be served in granting leave to defend and need for remanding

suit for decision in accordance with law is not felt.

19. The appeal is allowed.

20. The impugned judgment and decree is set aside and the suit of the

respondent/plaintiff from which this appeal arises is dismissed as barred by

time.

21. However the parties are left to bear their own costs.

22. Decree sheet be prepared.

23. The amount of Rs.1.30 lacs deposited by the appellant/defendant in this

Court together with interest earned thereon be returned to the

appellant/defendant after 31st August, 2016.

RAJIV SAHAI ENDLAW, J MAY 06, 2016 'pp' (Corrected and released on 16th June, 2016)