Gujarat High Court
Sustain Fiber Llp vs Sarvodaya Seva Samiti on 31 July, 2025
NEUTRAL CITATION
C/SCA/10551/2025 JUDGMENT DATED: 31/07/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 10551 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE MAULIK J.SHELAT
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Approved for Reporting Yes No
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SUSTAIN FIBER LLP & ANR.
Versus
SARVODAYA SEVA SAMITI & ORS.
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Appearance:
MR MEHUL M MEHTA(3416) for the Petitioner(s) No. 1,2
RAVI B SHAH(5346) for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE MAULIK J.SHELAT
Date : 31/07/2025
ORAL JUDGMENT
1. Heard learned advocate Mr.Mehul M. Mehta for the
petitioners and learned advocate Mr. Saurabh M. Patel with
learned advocate Mr.Ravi B. Shah for the respondent.
2. The presented application is filed under Article 227 of the
Constitution of India, seeking the following relief:-
"a) Your Lordships may be pleased to admit and allow this Special
Civil Application.
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b) Your Lordships may be pleased to issue appropriate writ, order
or directions to quash and set aside the order dated 13/06/2025
passed below Exh. 20, by the Learned 2nd senior Civil judge
Ahmedabad (Rural) in case (SMST) special summary suit no.
139/2018, (ANNEXURE - A).
c) Pending admission hearing and final disposal of this petition your
Lordships may be pleased to stay order dated 13/06/2025 passed
below Exh. 20, by the Learned 2nd senior Civil judge Ahmedabad
(Rural) in case (SMST) special summary suit no. 139/2018,
(ΑΝNEXURE - A).NEXURE - A).
d) Your lordships may be pleased to pass any other appropriate
and just order/s in the interest of justice."
3. THE SHORT FACTS OF THE CASE
3.1. The petitioners herein are original defendant nos. 1
and 2, whereas respondent no. 1 herein is the plaintiff and the
rest of the respondents are partners of the petitioner no. 1 -
firm.
3.2. The Special Summary Suit No. 139 of 2018 came to be
filed against the petitioners, wherein summons for judgment
was served upon them, against which, leave to defend
application came to be filed.
3.3. After hearing the parties, the Trial Court, vide its
impugned order dated 13.06.2025, granted conditional leave to
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defend the suit whereby it directed the petitioners to deposit
50% of the amount claimed in the suit.
4. Being aggrieved and dissatisfied with the aforesaid
impugned order, the present writ application is filed by
original defendant nos. 1 and 2 only.
5. SUBMISSIONS OF THE PETITIONERS-DEFENDANT NOS. 1
AND 2
5.1. Learned Advocate Mr. Mehta would submit that there
was no privity of contract between the plaintiff and defendant
no. 1 - firm, inasmuch as there is a specific denial of the
receipt of the goods from the plaintiff, thereby the question of
any amount due and payable would not arise at all.
5.2. Learned advocate Mr. Mehta would submit that there
are several triable issues which were raised by the defendants
which were completely overlooked by the Trial Court while
imposing a condition upon the defendants to defend the
summary suit filed by the plaintiff.
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5.3. Learned advocate Mr. Mehta would further submit
that, in the case of the petitioners, some of the partners,
namely, defendant nos. 3 and 4, being in connivance with the
plaintiff, have created this entire claim, which is otherwise
never due and payable.
5.4. So, according to learned advocate Mr. Mehta, the
petitioners herein are entitled to and ought to have been
granted unconditional leave to defend the suit.
5.5. In support of his submissions, learned advocate Mr.
Mehta would rely upon the following two decisions:-
I. Mechelec Engineers And Manufacturers Vs. Basic
Equipment Corporation, reported in (1976) 4 SCC 687;
II. R. Saravana Prabhu and Another vs. Videocon Leasing
and Industrial Finance Limited and Another reported in (2013)
14 SCC 606.
5.6. Making the above submissions, learned advocate
Mr.Mehta would request this Court to allow the present writ
application.
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6. SUBMISSIONS OF THE RESPONDENT
6.1. Learned advocate Mr.Patel with learned advocate
Mr.Ravi B. Shah appearing for the plaintiff would submit that
the present writ application is nothing but a misuse of the
process of law by defendant nos. 1 and 2, inasmuch as without
making out any specific defence, a general denial was given by
the defendants when filed the leave to defend application.
6.2. Learned advocate Mr. Patel would further submit that
prior to the filing of the suit, a demand notice/letter came to
be served upon the defendants on 01.08.2018 and 09.08.2018
through R.P.A.D. post and the same was not replied to.
6.3. It is further submitted that copies of both these letters
were produced on the record of the suit and there is no
specific denial given by the defendants in regard to the same.
6.4. Learned Advocate Mr. Patel would submit that the
plaintiff has already supplied the goods and the defendants
have failed to pay the amount as per the demand, thereby
cause arose for the plaintiff to file summary suit, which is
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maintainable in law and, as such, there is no triable issue
raised by the defendants, whereby they can claim
unconditional leave as alleged.
6.5. Learned advocate Mr. Patel would further submit that
this Court, while exercising its power under Article 227 of the
Constitution of India, may not disturb the order passed by the
Trial Court, which is discretionary in nature and as such, the
impugned order is neither erroneous, perverse nor arbitrary in
nature.
6.6. Learned advocate Mr.Patel would submit that the
jugdments, which are cited by the learned advocate Mr.Mehta
is no longer a good law and as such, without checking the
correct position of law, that has been cited and thereby, the
same be ignored.
6.7. To buttress his arguments, learned advocate Mr. Patel
would rely upon the following two decisions:-
I. IDBI Trusteeship Services Limited vs. Hubtown Limited
reported in (2017) 1 SCC 568;
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II. Sudin Dilip Talaulikar vs. Plycap Wires Privated Limited
and others reported (2019) 7 SCC 577.
6.8. Making the above submission, learned advocate
Mr.Patel would request this Court to dismiss the present writ
application.
7. No other and further submissions are made.
8. POINT FOR DETERMINATION
8.1. The short question that falls for my consideration as
to whether, in the facts and circumstances of the case, is there
any gross error of law committed by the Trial Court while
granting conditional leave to defend the suit by directing the
petitioners to deposit 50% of the amount involved in the suit?
9. ANALYSIS
10. The facts, which are noted hereinabove, are not in
dispute. Prima facie, it appears that except for general denial
of the facts by the defendants in their leave to defend
application, there is no case set up by the defendants which
would entitle them to get unconditional leave.
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11. What is required to be considered by the Trial Court
while examining leave to defend application is as to whether a
triable issue is germane in the matter or not. If the answer is
in the affirmative, the defendant is entitled to unconditional
leave; otherwise, it is a discretion available with the Trial
Court to impose some condition while permitting defendant to
defend the suit.
12. Such issue is no longer res integra, having been clarified
in so many words by the Hon'ble Supreme Court in the case of
IDBI Trusteeship (supra), wherein, it has been held thus:-
"17. Accordingly, the principles stated in para 8 of Mechelec case
[Mechelec Engineers & Manufacturers v. Basic Equipment Corpn.,
(1976) 4 SCC 687] will now stand superseded, given the
amendment of Order 37 Rule 3 and the binding decision of four
Judges in Milkhiram case [Milkhiram (India) (P) Ltd. v. Chamanlal
Bros., AIR 1965 SC 1698 : (1966) 68 Bom LR 36] , 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
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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."
(emphasis supplied)
13. As such, the judgment, which has been cited by the
learned advocate for the petitioners, i.e., Mechelec Engineers
(supra), would not be applicable to the case at hand and, as
such, the judgment of Mechelec Engineers (supra) stands
superseded after the amendment in Order XXXVII, Rule 3 of
the Civil Procedure Code, 1908 (hereinafter referred to as
'CPC'), as observed by the Hon'ble Supreme Court of India in
the case of IDBI Trusteeship (supra).
14. Then, another judgment cited by learned advocate Mr.
Mehta, i.e., R. Saravana Prabhu (supra), was passed on the
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basis of the law laid down in Mechelec Engineers (supra),
which has now already been superseded as observed
hereinabove.
15. Thus, both the decisions, which are cited by the learned
advocate Mr.Mehta appearing for the petitioners would not be
applicable and as such, this legal aspect of the case ought to
have been first considered by him before citing the same
before the Court. Learned advocate Mr.Mehta requires to take
note of the fact that whenever any judgment cited before the
Court, whether it stands as on date or not is required to be
first checked. As every advocate is an officer of the Court, it is
his/her duty not to cite any judgment which is either overruled
or superseded.
16. At this stage, considering the first mistake on the part of
Mr. Mehta, nothing more is stated by this Court.
17. Now, coming back to the facts of the present case, as
discussed hereinabove, except for general denial by the
defendants, nothing is set up by them in support of their
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defence while submitting their leave to defend application. It is
not even clarified by the defendants in their leave to defend
application whether the demand notices/letters dated
01.08.2018 and 09.08.2018 had been received by them or not.
18. Prima facie, such demand notices, having not been
replied by the defendants, would indicate that there was a
business transaction between the plaintiff and the defendant -
firm. Of course, as observed by the Trial Court, so far as such
claim is concerned, it requires to be proved by the plaintiff by
leading appropriate evidence. But when, prima facie, it has
come on record that goods were dispatched by the plaintiff
and there was demand raised by the plaintiff from the
defendants by way of the aforesaid demand letters/notices,
which remained unanswered, such fact would go against the
defendants in the absence of any specific denial.
19. Thus, according to this Court also, the case of the
defendants would fall in the category that any defence set up
by defendants may be plausible, i.e., that they have not
received the goods, but it is improbable in absence of any
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other material particulars on record submitted by the
defendants, especially when they have not replied to the said
demand letter and notice.
20. In that situation, as per the judgment of the Supreme
Court in the case of IDBI Trusteeship (supra) (para 17.4), the
defendants can be allowed to defend the suit, subject to the
condition which is put by the Trial Court.
21. In view of the aforesaid, I am in complete agreement
with the view taken by the Trial Court, which is not found to
be either erroneous, perverse, arbitrary, or contrary to any
provisions of law.
22. CONCLUSION
22.1. Thus, the upshot of the aforesaid observations,
discussion and reasons would lead to only one conclusion that
the present writ application is bereft of any merits and
requires to be dismissed, which is hereby DISMISSED. No order
as to costs.
(MAULIK J.SHELAT,J)
MOHD MONIS
