Ram Snehi vs Neeraj Kumar Tiwari
2018 Latest Caselaw 5748 Del

*              IN THE HIGH COURT OF DELHI AT NEW DELHI

+                  RFA No.803/2018

%                                             24th September, 2018

RAM SNEHI

                                                          ..... Appellant

                          Through:       Mr. Amarveer Singh Bhullar
                                         and Mr. Arvind Kr. Chauhan,
                                         Advocates (9868214878,
                                         9999118899)

                          versus

NEERAJ KUMAR TIWARI

                                                        ..... 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. 38828/2018 (delay in filing) & CM No. 38829/2018 (delay in re-filing) For the reasons stated in the applications, delays in filing and

re-filing are condoned.

CMs stand disposed of.

RFA No. 803/2018 & CM No. 38827/2018 (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 26.04.2018 by which

the trial court has decreed the suit filed by the respondent/plaintiff

under Order XXXVII CPC by dismissing the leave to defend

application filed by the appellant/defendant.

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

the subject suit pleading that the appellant/defendant was given by the

respondent/plaintiff a loan for a total sum of Rs. 6,00,000/-. Out of

the amount of Rs.6,00,000/-, a sum of Rs. 1,65,000/- was paid by

cheque on 13.03.2017, another sum of Rs. 2,00,000/- was paid by

cheque on 06.05.2014, and a further balance sum of Rs. 2,35,000/-

was paid in cash in March 2014. The appellant/defendant in

confirmation of the loan signed the Loan Agreement dated 26.05.2014

as also the Receipt of the same date for a sum of Rs. 6,00,000/-. Loan

was repayable in 11 months but since the same was not repaid hence

the subject suit under Order XXXVII CPC was filed.

3. The appellant/defendant filed his leave to defend

application by pleading that the Loan Agreement and Receipt are not

valid documents because the said two documents were signed by the

appellant/defendant but they were not signed towards the alleged loan

of Rs. 6,00,000/- but because the respondent/plaintiff, who was

working in HDFC Bank, stated that he would assist the

appellant/defendant in getting a loan on his car and through this loan

taken from the bank, a part amount would be used for repaying the

loan taken by appellant/defendant from the father of

respondent/plaintiff. It was pleaded by the appellant/defendant that in

March 2014, he had taken a loan of Rs. 1,65,000/- from the father of

the respondent/plaintiff and thereafter another loan of Rs. 2,00,000/- in

May 2014 and these loans were repaid. It is pleaded by the

appellant/defendant that he signed the Loan Agreement and Receipt

dated 26.05.2014 in blank and not for confirmation of the loan which

the respondent/plaintiff alleges, but the same were signed for taking of

the loan on car from HDFC Bank. It was also pleaded by the

appellant/defendant that the loan taken from the father of the

respondent/plaintiff was repaid back partly in cash and partly by

supplying groceries to the father of the respondent/plaintiff. It was

also pleaded by the appellant/defendant that when he took loan from

the father of the respondent/plaintiff, he gave two cheques as security

to the father of the respondent/plaintiff being cheque nos. 845153 and

845157, but these cheques were not returned by the father of the

respondent/plaintiff even after repayment of loan on the ground that

these cheques have been misplaced.

4. The trial court has dismissed the leave to defend

application by observing that the principles with respect to grant of

leave to defend are those as have been stated by the Supreme Court in

its recent judgment in the case of IDBI Trusteeship Services Ltd. v.

Hubtown Ltd., (2017) 1 SCC 568 and relevant paragraphs of which

judgment discussing principles of leave to defend read as under:-

"17. Accordingly, the principles stated in paragraph 8 of Mechelec's case will now stand superseded, given the amendment of Order XXXVII Rule 3, and the binding decision of four judges in Milkhiram's 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. The trial court has thereafter rightly observed that the

appellant/defendant does not deny his signatures on the Loan

Agreement and Receipt and that the appellant/defendant also was not

able to prove that he had taken any loan, not from the

respondent/plaintiff, but from the father of the respondent/plaintiff, of

a sum of Rs. 3,65,000/-. Further, the appellant/defendant could not

prove that how this loan was repaid by him to the father of the

respondent/plaintiff as there is no document in support of the

repayment of the alleged loan taken by the respondent/plaintiff from

the father of the respondent/plaintiff nor are there any documents to

show that father of the respondent/plaintiff was supplied groceries by

the appellant/defendant. The trial court has also rightly held that the

stand of the appellant/defendant cannot be believed, because if he had

given two cheques as security to the father of the respondent/plaintiff,

then why were the said cheques not taken back on repayment of the

loan to the father of the respondent/plaintiff. Furthermore, if the said

cheques were not being returned, then why a legal notice or any letter

was not sent to the father of the respondent/plaintiff to return the

alleged security cheques. The trial court has also held that the case put

up by the appellant/defendant is not believable of his having signed

the Loan Agreement and Receipt dated 26.05.2014 on the ground that

the respondent/plaintiff would have got for him a loan on car from

HDFC Bank.

6. I completely agree with the reasoning and conclusions of

the trial court because appellant/defendant besides making self-serving

statements, has not done or filed anything to substantiate his case,

whereas on the other hand, the respondent/plaintiff has ex facie

established his case through documents, with the fact that if the loan

was taken by the appellant/defendant from the father of the

respondent/plaintiff then why were the security cheques allegedly

given to the father of the respondent/plaintiff not claimed back by the

appellant/defendant by issuing any notice or letter.

7. I would also like to note that out of the total loan amount

of Rs. 6,00,000/-, a sum of Rs.3,65,000/- was received by the

appellant/defendant by means of cheques from the account of the

respondent/plaintiff and therefore, the trial court has rightly held that

loan was given by the respondent/plaintiff and not his father. Also,

the respondent/plaintiff in the facts of the present case need not have

proved the source of funds available to him once the

appellant/defendant admitted his signatures on the loan agreement as

also the receipt.

8. There is no merit in the appeal. Dismissed.

SEPTEMBER 24, 2018/ib                         VALMIKI J. MEHTA, J