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Sudarshan Dhoop Pvt Ltd vs Hotel Queen Road Pvt Ltd
2022 Latest Caselaw 2190 Del

Citation : 2022 Latest Caselaw 2190 Del
Judgement Date : 13 September, 2022

Delhi High Court
Sudarshan Dhoop Pvt Ltd vs Hotel Queen Road Pvt Ltd on 13 September, 2022
                          *      IN THE HIGH COURT OF DELHI AT NEW DELHI

                          %                                  Date of Reserved: 04th July, 2022
                                                             Date of Decision: 13th September 2022

                          +                         CS(OS) 3057/2011

                                 SUDHARSHAN DHOOP PVT LTD
                                 4 & 5, G.I.A., G.T. Karnal Road,
                                 Azadpur, Delhi- 110033                        .... PLAINTIFF
                                                    Through:       Mr. Amardeep Singh, Advocate

                                                    versus

                               1. HOTEL QUEEN ROAD PVT LTD
                                  19, Ashoka Road,
                                  New Delhi - 110001
                               2. MR. R.P. MITTAL
                                  81, Sainik Farms,
                                  M.B. Road, New Delhi                         ..... DEFENDANTS
                                                    Through:       Mr. Sandeep Mittal, Advocate for D-1
                                                                   & D-3

                                 CORAM:
                                 HON'BLE MS. JUSTICE NEENA BANSAL KRISHNA

                                                    JUDGEMENT

I.A.5270/2017

1. An application under Order XIIIA read with Section 151 of the Code of Civil Procedure, 1908 (hereinafter referred to as "CPC") has been filed on behalf of the plaintiff for Summary Judgment.

2. The material facts as stated in the application are that the plaintiff gave a loan of ₹5,10,75,000/- to the defendant no. 1 through 14 account payee cheques issued between February, 2017 to July, 2018. All the cheques

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 were honoured and the amounts were credited to the bank account of defendant No.1. It was orally agreed that defendant No.1 shall pay an interest @ 12% per annum to the plaintiff on the loan amount. The defendant No.1 returned a sum of ₹22,00,000/- to the plaintiff on account of the pending loan through account payee cheques dated 01st December, 2008 in the sum of ₹10,00,000/- and cheque dated 06th December, 2008 in the sum of ₹12,00,000/-.

3. The defendant no.1 did not give any directions to the plaintiff in regard to the appropriations of the said amounts, and thus, the plaintiff appropriated the amounts firstly towards the accrued interest and thereafter towards the principle amount. The statement of account of the plaintiff Company reflects the entries of the amounts paid in the account of the defendant Company and also reflects an amount of ₹22,00,000/- received from the defendant No. 1 towards partial discharge of the loan liability.

4. The plaintiff has asserted that defendant No.1 in its written statement did not deny the fact of honouring the cheques and of the amount being credited to his account. However, a defence was set up that the plaintiff Company is owned, managed and controlled by Ms. Jyoti Kesari and her husband Manoj Kesari who are the daughter and son-in-law of Shri R.P. Mittal, defendant No. 2 ex-Managing Director of the defendant no.1 Company. At the relevant time, Jyoti Kesari and Vandana Mittal, the daughters of Sh. R.P. Mittal, were appointed as Vice president of Plaintiff Company on a salary of ₹25,000/- p.m. They all devised a mechanism to defraud the defendant no. 1 Company and defendant no. 2 took out the money from the account of the defendant Company immediately after it was credited and transferred it back to his account; thus, leaving no money as

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 paid in the account of defendant's Company but creating a liability against defendant Company by such transactions. It is asserted that the defendant except this bald assertion, has not filed any document in support thereof and it is evident that the defendants have no defence. In fact, the amount of ₹5,10,75,000/- has been shown in the books of defendant No. 1 Company in the year 2007 thereby admitting having received amount. This amount has also been shown in its Balance Sheet and defendant No.1 has admitted unsecured loans of ₹30 lakhs in its Balance Sheets. The amount so received has not been disputed by the defendant No.1. Even in the reply to the legal Notice, defendant No.1 has specifically mentioned that the amounts received were siphoned off, which again shows that it has admitted the credit of loan amount to the account of defendant no. 1. No record or documents have been filed to corroborate the assertions of money being taken away or siphoned off.

5. The plaintiff has also referred to the copies of CS (OS) 61/2012 filed by defendant no. 1 Company against the several defendants including defendant no. 2 and the plaintiff herein. It is asserted that defendant no. 1 has specifically stated in paragraph 12C in reference to the defendant no. 2 in this Suit, that the money was brought in through the defendant no. 1 Company, but was immediately taken out by defendant No. 2 on various fake pretences leaving a mere entry in the books of defendant No.1 Company, thereby clearly admitting that the amount of loan was received by defendant No. 1 Company.

6. The plaintiff has asserted that defendant no. 1 Company is a separate legal entity and is distinct from its Shareholders and its Directors. The money was paid to defendant no. 1 Company through cheques, which have

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 been duly honoured and the amounts credited to the accounts of defendant no. 1. No personal liability is attached to the Directors and even otherwise the money which is borrowed by the Company has to be satisfied from the assets of the Company and not the Directors individually.

7. It is, therefore, submitted that defendant No.1 has no possible defence and has no real prospect of successfully defending the claim and there are no compelling circumstances for allowing the claim of the plaintiff. A prayer is, therefore, made for Summary Judgment for recovery of ₹6,59,81,250/- (₹4,88,75,000/- towards principle amount and ₹1,71,06,250/- towards interest @ 12% per annum till the date of filing of the suit).

8. The defendant in its reply to the application has converted the assertions made in the application. It is stated that the application does not come within the purview of the Order XIIIA of CPC as no requisite ingredients have been pleaded. The plaintiff has not been able to show that the defendant has no real prospect of successfully defending the claim. The petition is at the outset is not maintainable on various grounds. It is asserted that there is no agreement much less written agreement evidencing the alleged loan given by the plaintiff to defendant no. 1 Company. There is no contemporaneous correspondence during the period when the alleged loan is alleged to have been allegedly given by the plaintiff. There is no acknowledgement of the alleged liability by the defendant. The transactions are suspicious and undocumented.

9. Further, the alleged transactions pertain to the period when defendant no. 2 was fraudulently and illegally controlling and managing the Defendant No. 1 Company as its Managing Director. The plaintiff is a closely held Private Limited Company belonging to Mr. Manoj Kesari and Ms. Jyoti

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 Kesari, the son-in-law and daughter of Defendant no. 2 respectively. They were aware about the internal disputes between the two groups within Defendant No. 1 Company. This is evident from the fact that the plaintiff never demanded repayment of the alleged loan given to defendant no. 1 Company or interest thereon so long as Defendant no. 2 was controlling the management of the Defendant no. 1 Company. It is only after the change of the management of Defendant no. 1 Company that plaintiff in collusion with Defendant no. 2 alleged the loan and sought its repayment.

10. The Defendant No. 1 Company has asserted that the entire suit of the plaintiff is based on various cheques issued by the plaintiff to Defendant for a sum of ₹5,10,75,000/-. The entire claim is based on oral understanding which is nothing but a fraud which is manifest from the facts that the written agreement between the plaintiff and defendant no. 1 Company has not been brought on record to show under what arrangement the loan was allegedly given to defendant no. 1 Company. Plaintiff has not brought on record as to who contacted the plaintiff for the alleged loan and for what reasons the said loan was taken by the defendant no. 1 Company. There is no correspondence wherein the Defendant no. 1 Company has clearly and categorically asked for alleged loan or had acknowledged the alleged loan amount. The basis on which interest at the rate of 12% p.a. is being claimed has also not being explained.

11. It is further asserted that the Banks Statements would show that the money had been credited in the account of the Plaintiff Company and a few days later that the money was credited to the account of Defendant no. 1 Company which was immediately withdrawn thereafter by defendant no.2. The manner in which the money was credited and withdrawn from the

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 account of defendant no.1 clearly shows that the transactions were fraudulent and no loan was ever taken by defendant no.1 Company.

12. The defendant no. 1 Company has further highlighted various suspicious circumstances. It is pointed out that the plaintiff has claimed that it was giving alleged loans from time to time but lending money is not the main business of the plaintiff Company. According to the plaintiff, the loan was to be repaid within three years but the alleged disbursement of loan shows that even after the lapse of three years, neither the money was repaid nor any interest was paid on the principal but the plaintiff kept on lending money to Defendant no. 1 Company which no prudent man would do.

13. It is further asserted that there was no alleged understanding between the parties to give rise to any liability of the Defendant no. 1 Company towards the plaintiff. Even if it is assumed that the money transactions took place but there is no explanation as to why plaintiff Company lent ₹6,59,81,250.00/- in the year 2008 to a Company on an oral agreement without any authority/ Board Resolution of defendant no.1 Company for the alleged loan and without conducting any due diligence about the Defendant no. 1 Company which shows the fraud played upon the defendant Company.

14. It is further submitted that there were number of legal proceedings concerning the management on Defendant no. 1 Company which were pending, and any person conducting due diligence in any manner would have knowledge about the pending litigation. This fact assumes significance from the fact that plaintiff Company is owned, managed and controlled by the son-in-law of defendant no. 2 who was the Managing director Defendant no. 1 Company at the relevant time. A fictitious liability is sought to be created by the plaintiff in collusion with Defendant no. 2 to cause unlawful

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 gain to plaintiff and unlawful loss to defendant no. 1 Company. It is claimed that the alleged transactions were never approved by any Board Resolution of defendant no. 1 Company.

15. It is further asserted that defendant no. 1 Company had available banking credit limits for its business. In the normal course, the Company would have borrowed from banks when it required loan for its business. The banks offered the loan at the rate of 8% p.a. while the plaintiff is claiming the interest of 12% p.a. The rate of interest allegedly claimed to have been agreed is very high which again raises suspicion about the loan transactions. It is therefore clamed that there was a fraud committed by the plaintiff Company upon Defendant no. 1 Company and defendant no. 2 used the plaintiff to perpetuate its fraud.

16. The defendant has further asserted that Defendant no. 3(sic.) was a Director of the Board of the Defendant no. 1 Company from 08.02.2002 but was not involved in its day-to-day management. Defendant no. 3(sic.) was designedly excluded by defendant no. 2 and was not given details and documents relating to the functioning of the defendant Company. He repeatedly wrote letters to defendant no. 2 seeking permission and also lodged complaints to various authorities. The Defendant no. 3(sic.) specifically asked defendant no. 2 in regard to the unsecured loans, share application monies, etc. that was alleged to have been borrowed by the Defendant Company. The Defendant no. 2 responded to the request made by the defendant no. 3(sic.) for information vide its letter dated 07.04.2007 stating that there was no need for him to know the names and details of the share application money and unsecured loans as it did not concern him.

17. It is further asserted that this was not the isolated letter, but since the

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 year 2005, defendant no. 2 was designedly shielding the information and avoided disclosures in relation to the affairs of the defendant no. 1 Company. It is further asserted that on account of aforesaid and other disputes that had arisen between the shareholders including the defendant no. 3(sic.), the then management of defendant no. 1 Company which included defendant no. 2, various litigations came to be filed before this Court and Company Law Board. The Defendant no. 1 Company had infact already issued caution notices which could not have possibly missed the attention of the plaintiff.

18. It is further submitted that defendant no. 2 had given an undertaking in FAO (OS) No. 282 of 2005 vide Order dated 18.05.2006 that it will not create any third-party liability in the Defendant Company. Thereafter, the High Court on 03.10.2008 being aware of the conduct of Defendant no. 2 made it clear in CA 1102/2008 in Co. A (SB) 5/2006 that no liability would accrue on Mr. Ashok Mittal while running the hotels. Various Orders were passed from time to time preceding the judgement dated 14.01.2009.

19. This Court vide Order dated 21.11.2008 had appointed M/s S.R. Batliboi & Co. to audit accounts of Defendant no. 1 Company for the Financial Years from 2005-2006 till 2008-2009. This audit exercise however could not be concluded due to non-cooperation of defendant no. 2. Defendant no. 3(sic.) wrote letters to M/s S.R. Batliboi & Co to examine the records of the Company in relation to the defendant no. 2's claim of unsecured loans, share application monies etc. as defendant no. 3(sic.) feared that the records and documents are not being maintained fairly and number of suspicious transactions were being entered into by defendant no. 2 without the knowledge or the consent of Board. The auditors were unable

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 to verify the accounts and moved an application being C.M No. 754 of 2009 in FAO(OS) No. 440 of 2008 seeking directions to defendant no. 1 Company being exclusively managed by Defendant no. 2, to extend full cooperation to the Auditors. The Division Bench of this Court gave a judgement on 14.01.2009 by which the management of the Defendant Company changed and the present management assumed charge of its affairs.

20. Anticipating its exit from the management, Defendant no. 2 and his associates resorted to large scale removal of records of the Defendant Company which was recorded on CCTV Cameras. The present Management therefore does not have complete accounts and is seriously crippled in asserting the dealings of defendant no. 2. The Defendant Company has no option but to go by the Income Tax Returns filed by the Defendant Company without admitting the authenticity and genuineness of what was recorded by the defendant no. 2 while he was exclusively in-charge of defendant no. 1 Company. The new Auditors appointed by the new Management also faced similar handicap and stated that on account of non- availability of the records with the new Management who took over the control of the Company on 15.01.2009, the Income Tax Returns signed by defendant no. 2 and the balance sheets and Profit and Loss Account that were filed for the year ending 31.03.2008, had been adopted by the new Management in its Board Meeting held on 15.07.2009. The same balances had been taken as opening balances for the current year and the nature of the account has not been changed in the absence of non-availability of records with new Management. It is further recorded that as per the report of the Company Secretary vide letter dated 20.01.2009 statutory records including

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 original documents such as Certificate of Incorporation, Counterfoil of Share Certificates, Share Application forms, Loans or deposit application forms, Register of Deposit and copies of contracts are lying with erstwhile Director Shri R.P. Mittal. Minutes of Shareholders Meetings, etc. are also not available with the Company upto 14.01.2009. The Auditors report in regard to the Financial Statement for the year ending 31.03.2015 states that because of being constrained of not being handed over important documents and records, the present Management has adopted the figures as stated in the Income Tax Returns of the old management filed for the year ending 31.03.2008.

21. The defendant no. 1 Company has filed a suit bearing no. CS(OS) No. 161 of 2016 titled as "M/s Hotel Queen Road Pvt Ltd. & Others v. M/s. Moral Trading Investment Ltd & Others" against the malfeasance and misfeasance done by the Defendant no. 2 in connivance with other such Companies and persons including the present Plaintiff Company for declaring these alleged transactions as null and void.

22. The defendant No.1 has claimed that the issues that have arisen from the pleadings which can be decided only after the issues are framed and the evidence is led by the parties are as under: -

(i) Whether the amount in question was given as a loan to the Defendant by the Plaintiff?

(ii) What were the terms of the alleged transaction?

(iii) Whether the claim is within the period of limitation?

(iv) Whether the present suit has been filed in collusion between the Plaintiff and Defendant no. 2?

(v) Whether there was any agreement between the

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 plaintiff and Defendant no. 1 Company for giving Corporate loan on interest?

(vi) Whether the Plaintiff has given a loan of ₹ 5,10,75,000/- to Defendant no. 1 on interest at 12% p.a.?

23. The defendant no. 1 has raised triable issues and alleged facts of such a nature which entitles the defendant to cross-examine the plaintiff and its witnesses. The real test of success in the application under Order XIIIA of CPC is that it should lead to only one conclusion/inference that defendant has no likelihood of succeeding in the matter. This inference can be exercised only in extreme case which is not made out in the present case. It is therefore submitted that the present application is without merit and is liable to be dismissed.

24. Submissions heard.

25. In the Commercial Suit, while Order XII Rule 6 CPC has been made applicable, Order XIIIA CPC titled 'Summary Judgments' has been incorporated. The legislative intent behind introducing summary judgment under Order XIIIA of CPC is to provide a remedy independent, separate and distinct from judgment on admissions and summary judgment under Order XXXVII of CPC. It empowers the Court to give Summary Judgment against the plaintiff or the defendant on a claim it considers that the plaintiff has no real prospects of succeeding in the claim or the defendant has no real prospect of successfully defending the claim, as the case may be and there is no other compelling reason why the claim should not be disposed of before recording of oral evidence. Rule 4 prescribes the procedure for making Summary Judgments.

26. The relevant parts of Order XIIIA Rule 3 CPC read as under:

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 "3. Grounds for summary judgment.- The Court may give a summary judgment against a plaintiff or defendant on a claim if it considers that

(a) the plaintiff has no real prospect of succeeding on the claim or the defendant has no real prospect of successfully defending the claim, as the case may be; and

(b) there is no other compelling reason why the claim should not be disposed of before recording of oral evidence."

27. In Swain vs. Hillman (2001) 1 AIR 91 Lord Woolf M.R. explained that the words "no real prospect" do not need any amplification as they speak for themselves. The Court needs to see whether there is a realistic as opposed to fanciful prospect of success. In Three Rivers District Council vs. Governor & Company of Bank of India (2003) 2 AC 1 the House of Lords while considering the word "no real prospect" held that Court should look what will happen at the trial and that if a case is so weak that it has no reasonable prospect of success, it should be stopped before great expenses are incurred.

28. These judgments were referred to by the Hon'ble Supreme Court in Sukam Power Systems Limited vs. Kunwer Sachdev & Anr. (2019) SCC OnLine, Delhi 10764 and it was observed that the legislative intent behind introducing Summary Judgments under Order XIIIA of CPC is to provide a remedy independent, separate and distinct from the judgment on admission and summary judgment under Section XXXVII CPC. The Apex Court endorsed the test of real prospect of succeeding or no real prospect of defending the claim for determination of an application for Summary

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 Judgment, as propounded in the aforementioned judgements. It was observed that "49. Consequently, this Court is of the view that when a summary judgment application allows the Court to find the necessary facts and resolve the dispute, proceeding to trial would generally not be proportionate, timely or cost effective. It bears reiteration that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the Court the confidence that it can find the necessary facts and apply the relevant legal principles so as to resolve the dispute as held in Robert Hryniak (supra).

....

51. This Court clarifies that in its earlier judgment in Venezia Mobili (India) Pvt. Ltd. v. Ramprastha Promoters & Developers Pvt. Ltd., 2019 SCC OnLine Del 7761 while deciding two applications, both filed by the plaintiff in the said case (one under Order XII Rule 6 and other under Order XIIIA) it had applied the lowest common denominator test under both the provisions of the Code of Civil Procedure and held that the suit could be decreed by way of a summary judgment.

52. Consequently, this Court is of the opinion that there will be „no real prospect of successfully defending the claim‟ when the Court is able to reach a fair and just determination on the merits of the application for summary judgment. This will be the case when the process allows the court to make the necessary finding of fact, apply the law to the facts, and the same is a proportionate, more expeditious and less expensive means to achieve a fair and just result."

29. The twin test therefore, provided for a Summary Judgment is:

(i) that there is no real prospect of succeeding or of defending the claim, or

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19

(ii) there are no other compelling reasons as to why the claim should not be disposed of before recording of oral evidence.

30. In the light of this twin test prescribed under Order XIII Rule 3A CPC the facts of the present case need to be considered.

31. It is a simple case of the plaintiff that he had given loans from time to time that is from 01.02.2007 till 16.07.2008 totalling to ₹5,10,75,000/- to defendant no. 1 Company which has not been repaid and the plaintiff is entitled to recovery of the loan amount along with the interest at the rate o 12% p.a. To support his assertions, the plaintiff has relied upon his Bank Statements showing a credit in the bank account of the Defendant no. 1 Company.

32. The defendant however has challenged the case of the plaintiff on the ground that the plaintiff is a closely held family Company and is held by the son-in-law and the daughter of the defendant no. 2 Shri R.P. Mittal who was at the relevant time, the Director of the Defendant no. 1 Company. There was mis-management in defendant no. 1 Company and various litigations were on going in regard to the management and internal disputes, so much so that even various public notices had been issued informing the general public about the litigation pending in regard to the company and that the Director, Shri R.P Mittal had given a statement that it shall not transfer or create third party rights in respect of the hotel in question without the permission of the Court. A warning was therefore issued that any person who deals with Shri R.P Mittal or his nominees would do so at his own risk.

33. It is claimed that Shri R.P Mittal played a fraud on the Company and refused to disclose the deals and the working of the Company to defendant

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19 no. 3(sic.), the then Director of Defendant no. 1 Company and refused to give any details of the transactions undertaken on behalf of the Defendant no. 1. The defendant has taken a specific defence that defendant no. 2 in active connivance with plaintiff, which was the Company of his son-in-law, fraudulently got the money transferred in the account of the Company which were immediately taken out and siphoned off. There is a specific averment that there are no Board Resolutions authorising taking of loans. Moreover, the defendant no. 1 had its credit facility with the banks where the loans could have been obtained with an interest at the rate of 8% p.a. There was no occasion of reason for the defendant no. 1 Company to take the loan from the plaintiff Company at the interest of 12% p.a. Moreover, there is no agreement in regard to the taking of the loan and also the company had no occasion for having taken the loan from the plaintiff.

34. The defendant has asserted that there is a fraud committed by defendant no. 1 upon plaintiff in connivance with defendant no. 2. It is further asserted that even though there has been credit entry of ₹5,10,75,000/-, however it was never a loan taken by the defendant no. 1, but was only a money rooted to defendant no. 2 through defendant no. 1. There is nothing which is liable or payable on behalf of the defendant no. 1 Company.

35. The defendant has taken a specific plea that no loan was taken and there is no corresponding Board Resolution. There was no agreement in respect of the interest at the rate of 12% p.a. It had sought to prove through its defense that there was a blatant fraud committed by defendant no. 2 upon defendant no. 1. A plea of fraud is thus being taken by defendant no. 1 which has denied its liability of paying the loan or the interest thereon.

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19

36. In Durga Builders (P) Ltd. v. Motor and General Finance Ltd. and Anr. 2013 SCC OnLine Del 5165, this Court noted that though it was an application under Order XII Rule 6 CPC, it was under consideration and the plaintiff had based his claim for decree on the balance sheets where there was an admitted liability of the amount sought to be recovered. It was observed that in view of the specific defence of the defendant denying that mortgage transactions and also claimed fraud and raised issues of limitation, an opportunity had to be given to the defendant to explain the balance sheets and it could not be considered as a case where a decree could be given under Order XII Rule 6 CPC based on the admissions.

37. In the present case as well, though the plaintiff has relied upon his own bank Statements to assert that a loan of ₹5,10,75,000/- has been given to defendant no. 1, the defendant no. 1 has taken a specific plea of there being a fraud committed by defendant no. 2 who was the then Managing Director and managing face of the Company and manipulated the entries and siphoned off the money and that there was no Board Resolution in regard to taking of this loan.

38. The defendant no. 1 has sought to corroborate his plea of fraud by referring the various litigations between the defendant no. 1 and defendant no. 2 and other credit Companies and also has relied upon Public Notices being issued since 2006 warning the general public against dealing with Shri R.P. Mittal in regard to the affairs of the Hotels. The defendant no.1 has also relied upon various surrounding circumstances to explain the entries in the Bank Statements and documents of Defendant No.1 Company.

39. The defendant has also denied its liability of paying the interest at the rate of 12% p.a.

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19

40. Furthermore, it may be observed that the last loan transaction happened on 16.04.2008 while the suit has been filed in first week of December, 2011 raising the question of limitation. The plaintiff has also claimed that a sum of ₹22,00,000/- had been repaid in two instalments on 01.12.2008 and 06.12.2008 which has been adjusted towards the interest liability of the defendant. Interestingly, while the loan amounts are corroborated by the Bank Statements, there is no corresponding Bank Statement in regard to these refund amounts. The only document relied upon by the plaintiff in respect of these repaid amounts are its own Ledger accounts, the authenticity of which has been questioned by defendant no. 1.

41. From the pleadings, it is quite evident that plausible defences have been raised by defendant no. 1 about the genuineness and authenticity of transfer of money in the accounts of Defendant no. 1 for and on its own behalf and a fraud has been pleaded for which an opportunity has to be given which cannot be adjudged without the evidence being led by the parties.

42. If the issue of fraud and limitation is established by way of evidence, the suit of the plaintiff would have to be necessarily dismissed. The touchstone of twin test of there being no prospect of succeeding in proving the defence and that there are no compelling circumstances to allow the defendant to lead evidence does not work in favour of the plaintiff. Therefore, it is not a case where a judgement can be summarily pronounced under Order XIIIA CPC without recording of the evidence of the parties. The application is without merit and is hereby dismissed. CS(OS) 3057/2011

1. List this matter for framing of issues on 18th October, 2022.

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19

2. In the meanwhile, proposed issues be also filed by the parties.

(NEENA BANSAL KRISHNA) JUDGE SEPTEMBER 13, 2022 PA

Digitally Signed By:SAHIL SHARMA Signing Date:13.09.2022 14:07:19

 
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