Adesh Tyagi vs Pooja Tyagi
2018 Latest Caselaw 6993 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+                         RFA No. 953/2018

%                                                  27th November, 2018

ADESH TYAGI
                                                         ..... Appellant
                          Through:       Mr. Arun Kumar Tewari,
                                         Advocate (9873039189)

                          Versus

POOJA TYAGI
                                                         ..... Respondent

Through:

CORAM:

HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?

VALMIKI J. MEHTA, J (ORAL)

CM No. 49022/2018 (Exemption)

Exemption allowed subject to just exceptions.

CM stands disposed of.

CM No. 49023/2018 (delay in re-filing)

For the reasons stated in the application, delay in re-filing is condoned, subject to just exceptions.

CM stands disposed of.

RFA No. 953/2018 & CM No. 49021/2018 (stay)

1. This Regular First Appeal under Section 96 of the Code

of Civil Procedure, 1908 (CPC) is filed by the defendant in the suit

impugning the Judgment of the trial court dated 27.02.2018 by which

the trial court has dismissed the leave to defend application filed under

Section XXXVII Rule 3(5) of CPC and decreed the suit for recovery

of Rs. 26 lakhs alongwith pendente lite and future interest at 6% per

annum.

2. The facts of the case are that the respondent/plaintiff had

filed the subject suit pleading that her late husband had advanced a

loan of Rs. 25 lakhs to the appellant/defendant in May 2014. At the

time of giving of loan appellant/defendant had given eight blank

signed cheques for refund of the loan amount. The

appellant/defendant had paid some interest to the respondent/plaintiff.

An amount of Rs. 5 lakhs was said to have been paid by the

appellant/defendant in October, 2015 and thus bringing down the

liability from Rs. 25 lakhs to Rs. 20 lakhs. Some further amounts of

interest were paid till November 2015, whereafter the

appellant/defendant is pleaded to have stopped paying the interest.

Meanwhile, the husband of the respondent/plaintiff expired and the

respondent/plaintiff who is the wife of the person who had advanced

the loan to the appellant/defendant had therefore filed the suit after

eight cheques given for repayment of the loan amount were

dishonoured vide Cheque Return Memo dated 04.05.2017 for the

reason that 'signature differs'.

3. The appellant/defendant filed his leave to defend

application. In the leave to defend application the appellant/defendant

has raised the following grounds for grant of leave to defend:-

"a) That the present suit for recovery under Order XXXVII CPC is not maintainable.

b) That the defendant did not take any amount from plaintiff.

c) That the suit is without any cause of action and is liable to be rejected under Order VII Rule 11 CPC.

d) That the suit is bad for non-joinder and mis-joinder of necessary parties.

e) That the plaintiff has not come to the court with clean hands.

f) That in case leave to defend is not granted, defendant shall suffer irreparable injury and it would cause miscarriage of justice."

4. The trial court, in my opinion, has rightly dismissed the

leave to defend application because the leave to defend application is

completely without any substance. Though the appellant/defendant

has claimed that no amount was taken, however, the

appellant/defendant does not deny that the subject cheques are his

cheques and the subject cheques were dishonoured on presentation by

the bank of the appellant/defendant. Cheques are also presumed to

have been issued for consideration in view of Section 118 of the

Negotiable Instruments Act, 1881. Erroneously contending that no

loan was taken or that the suit is without cause of action will not

entitle the appellant/defendant to grant of leave to defend inasmuch as

it has been held by the Hon'ble Supreme Court in its recent judgment

in the case of IDBI Trusteeship Services Ltd. v. Hubtown Limited,

(2017) 1 SCC 568 that if there is no triable issue and the defence

raised is frivolous and/or vexatious then leave to defend cannot be

granted. The relevant para 17 of the judgment in the case of IDBI

Trusteeship Services Ltd. (supra) reads as under:-

"17. Accordingly, the principles stated in paragraph 8 of Mechelec case will now stand superseded, given the amendment of Order 37 Rule 3, and the binding decision of four judges in Milkhiram case, as follows: 17.1. If the defendant satisfies the Court that he has a substantial defence, that is, a defence that is likely to succeed, the plaintiff is not entitled to leave to sign judgment, and the defendant is entitled to unconditional leave to defend the suit.

17.2 If the defendant raises triable issues indicating that he has a fair or reasonable defence, although not a positively good defence, the Plaintiff is not entitled to sign judgment, and the Defendant is ordinarily entitled to unconditional leave to defend.

17.3 Even if the Defendant raises triable issues, if a doubt is left with the trial judge about the Defendant's good faith, or the genuineness of the triable issues, the trial judge may impose conditions both as to time or mode of trial, as well as payment into court or furnishing security. Care must be taken to see that the object of the provisions to assist expeditious disposal of commercial causes is not defeated. Care must also be taken to see that such triable issues are not shut out by unduly severe orders as to deposit or security.

17.4 If the Defendant raises a defence which is plausible but improbable, the trial Judge may impose conditions as to time or mode of trial, as well as payment into court, or furnishing security. As such a defence does not raise triable issues, conditions as to deposit or security or both can extend to the entire principal sum together with such interest as the court feels the justice of the case requires. 17.5 If the Defendant has no substantial defence and/or raises no genuine triable issues, and the court finds such defence to be frivolous or vexatious, then leave to defend the suit shall be refused, and the Plaintiff is entitled to judgment forthwith.

17.6 If any part of the amount claimed by the Plaintiff is admitted by the Defendant to be due from him, leave to defend the suit, (even if triable issues or a substantial defence is raised), shall not be granted unless the amount so admitted to be due is deposited by the Defendant in court."

5. In view of the aforesaid facts, I do not find that the trial

court has committed any illegality in dismissing the leave to defend

application and decreeing the suit. In fact, the trial court has been

kind enough to the appellant/defendant because pendente lite and

future interest have been granted only at 6% per annum whereas as per

Section 80 of the Negotiable Instruments Act, in case cheques are

dishonoured, a creditor is entitled to interest at 18% per annum.

6. There is no merit in this appeal. Dismissed.

NOVEMBER 27, 2018/ib                    VALMIKI J. MEHTA, J