Gujarat High Court
Manishbhai Mohanlal Shah (Chopra) vs Manhar Sukhlal Patel on 11 November, 2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 1365 of 2013
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE DEVAN M. DESAI
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Approved for Reporting Yes No
✔
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MANISHBHAI MOHANLAL SHAH (CHOPRA)
Versus
MANHAR SUKHLAL PATEL
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Appearance:
MR PARTH S TOLIA(5617) for the Appellant(s) No. 1
MR NK MAJMUDAR(430) for the Defendant(s) No. 1
MR.MANHAR S PATEL(6275) for the Defendant(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE DEVAN M. DESAI
Date : 11/11/2025
ORAL JUDGMENT
1. The present First Appeal is filed under
Section 96 of the Code of Civil Procedure, 1908 (For
short 'CPC') by the appellant - original defendant
assailing the judgment and decree dated 26.02.2009
passed by Chamber Judge, City Civil Court,
Ahmedabad in Summary Suit No.2357 of 2008.
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2. Heard learned advocate Mr.Parth Tolia for
the appellant - original defendant and learned
advocate Mr.N.K.Majmudar with learned advocate
Mr.Shivam N.Majmudar for the respondent - original
plaintiff
3. Brief facts are as under:-
3.1 The respondent - plaintiff had filed
Summary against the appellant - defendant for
recovery of Rs.9,50,000/- alongwith interest at the rate
of 18% per annum. It is the case of plaintiff that the
defendant was in need of money therefore, plaintiff
paid Rs.9,50,000/- to the defendant in September 2002
on condition that amount shall be repaid within a
period of 6 months. A Promissory Note dated
06.09.2002 was also executed by defendant in favour
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of plaintiff-respondent. In repayment of the said
amount, defendant issued a cheque in favour of
plaintiff. However, the said cheque was dishonoured on
account of the account being closed. Thereafter,
plaintiff issued notice dated 04.03.2004 to defendant.
Plaintiff also filed a criminal complaint under Section
138 of the Negotiable Instruments Act, 1881 against
defendant. On the date of filing suit, said complaint
was pending.
3.2 The summons of the suit were served upon
defendant and thereafter plaintiff took out summons for
judgment, against which, defendant filed an Affidavit
seeking leave to defend. The learned trial Court
granted unconditional leave to defend, against which,
plaintiff filed Special Civil Application No.23160 of
2007 before this Court which came to be allowed and
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defendant was granted leave to defend suit on
condition to deposit 75,000/- on or before 25 th
September, 2008. Since the defendant did not comply
with the said order, plaintiff took out a Non-payment
Certificate from the Registry of the City Civil Court,
Ahmedabad. Consequently, learned trial Court passed
judgment and decree in favour of plaintiff by resorting
to the provisions contained under Order XXXVII Rule
3(6)(b) of the CPC.
3.3 Being aggrieved and dissatisfied with
impugned judgment and decree, defendant - appellant
has filed the present appeal.
4. Learned advocate for the appellant
contended that the learned trial Court has committed
an error in straightway passing a decree against the
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appellant. It is contended that the plaintiff never
entered in the witness box and proved his case by
leading oral evidence. The plaintiff also failed to
produce any original documents. In absence of any oral
documentary evidence, learned trial Court ought not to
have passed the judgment and decree in favour of
plaintiff.
4.1 It is further contended that the judgment
and decree is ex-parte as defendant was not permitted
to file Written Statement to contest the suit. Appellant
also preferred Civil Misc. Application No.509 of 2004
for setting aside the ex-parte judgment and decree.
However, the said application came to be dismissed by
learned trial Court on 05.01.2007. Against which,
Special Civil Application No.3134 of 2007 was
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preferred by defendant before this Court. The said
Special Civil Application came to be allowed by
remanding the matter back to the learned trial Court
for deciding afresh. Upon remand, learned trial Court
again passed the judgment and decree which has been
assailed by way of present First Appeal. In Special
Civil Application No.23160 of 2007, appellant had
sought extension of time to deposit the amount
directed to be deposited by appellant-defendant.
Appellant deposited Rs.25,000/- on 05.08.2008 before
the learned trial Court and remaining amount of
Rs.50,000/- could not be deposited due to financial
constraints. So far as remaining amount of Rs.50,000/-
is concerned, this Court while condoning the delay in
preferring First Appeal, directed the appellant to
deposit the same which came to be deposited by the
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appellant on 09.06.2014 before this Court. It is further
contended that the entire decretal amount has been
deposited by appellant, and therefore, decree may be
quashed and set aside and an opportunity may be
given to the appellant-defendant to contest the suit.
Except above, no other submissions are made by
learned advocate for the appellant.
5. Per contra, learned advocate for
respondent-plaintiff supported the judgment and decree
and contended that the suit came to be filed by
respondent - plaintiff for recovery of advance loan
amount. A promisory note dated 06.09.2002 was also
executed by defendant in favour of plaintiff. The
learned trial Court granted unconditional leave to
defend, the said order was assailed by plaintiff before
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this Court, wherein defendant was granted conditional
leave to defend, subject to deposit Rs.75,000/- on 25 th
July 2008. The defendant did not comply with the said
order. Resultantly, execution petition was filed.
5.1 It is further contended that, in the
meantime, defendant filed Civil Misc. Application
No.509 of 2004 before the learned trial Court for
setting aside ex-parte decree. The order of rejection of
said application was assailed by defendant before this
Court by way of Special Civil Application No.3134 of
2007, wherein this Hon'ble Court set aside the
impugned order dated 04.04.2007 and remanded the
matter to the learned trial Court for fresh
consideration. After remand, learned trial Court passed
a judgment on the condition to deposit amount was
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not complied with.
5.2 The appellant also sought extension of time
to deposit the amount. This Court was pleased to
extend the time till 25.09.2008 on condition that the
appellant shall deposit an amount before the learned
trial Court. However, the said condition imposed by
this Court was also not complied with by defendant.
Consequently, appellant obtained Non-payment
certificate which was issued by the Registrar City Civil
Court, Ahmedabad on 10.02.2009.
5.3 Pursuant to the said Non-payment
Certificate, learned trial Court rightly decreed the suit
by invoking the provisions of order XXXVII Rule (3)(6)
(b) of the CPC. It is contended that when the condition
imposed upon defendant is not complied with, plaintiff
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shall be entitled to judgment forthwith. It is further
contended that once the provisions of order XXXVII
Rule (3)(6)(b) of CPC are invoked, plaintiff is not
required to prove the case by leading either oral or
documentary evidence.
5.4 In support of submissions, learned advocate
for respondent has relied upon following decisions:-
(i) National Commodity Clearing Ltd. (NCCL)
Vs. Dita Comtrade Limited passed by the
Hon'ble Bombay High Court in Commercial
Summary Suit No.32 of 2020;
(ii) K.R.Patel HUF Vs. M.M.Developers and Ors.
Reported in (2015) 03 BOM CK 0013 passed by
the Hon'ble Bombay High Court.
5.5 Except above, no other submissions are
made by learned advocate for the respondent.
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6. I have considered the submissions canvassed
by learned advocates for the parties and perused the
record and proceedings. It is an undisputed fact culled
out from the record that the order of unconditional
leave to defend passed by learned trial Court was
assailed by plaintiff before this Court wherein this
Court while granting leave to defend, imposed
condition to deposit an amount of Rs.75,000/-.
Admittedly, the condition imposed by this Court was
not complied within stipulated time. Despite the
extension to deposit money granted, defendant failed to
comply with condition. Resultantly, on issuance of
non-payment certificate by Registrar, City Civil Court,
Ahmedabad, a decree came to be passed in favour of
plaintiff. The contention raised by learned advocate for
the appellant that the defendant ought to have been
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given an opportunity to file Written Statement and
plaintiff was required to led oral as well documentary
evidence in proving its case, though sounds attractive
but has no force in the eye of law.
7. To consider the submission of learned
advocate for the appellant, it would be profitable to
reproduce Sub-clause (b) of Sub-rule 6 of Rule 3 of
Order XXXVII of the CPC which is as under:-
"3. Procedure for the appearance of defendant
(6) At the hearing of such summons for judgment
(b) if the defendant is permitted to defend as to the whole or any
part of the claim, the Court or Judges may direct him to give such
security and within such time as may be fixed by the Court or
Judge and that, on failure to give such security within the time
specified by the Court or Judge or to carry out such other
directions as may have been given by the Court or Judge, the
plaintiff shall be entitled to judgment forthwith."
The aforesaid provisions mandates that when
the defendant is permitted to defend the suit on
condition to give security which may be in form of
money, non-compliance of condition by defendant,
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would follow judgment forthwith.
8. The language of Rule 3(6)(b) of order
XXXVII of the Code is unambiguous and categorical. It
lays down that when a defendant has been directed to
defend the suit on a condition to deposit an amount, if
such condition has not been complied with, the
provision confers an immediate and indefensible right
upon the plaintiff to obtain a decree. Once defendant
defaulted, no further proceedings were warranted and
the only logical consequence was the decree in favour
of plaintiff.
9. The word "shall" and "forthwith" indicate
a legislative mandate and "forthwith" leaves no scope
for postponement beyond what is reasonably required.
Since the grant of leave to defend was conditional and
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based on a prima facie evaluation of facts, failure to
comply with the condition automatically extinguished
the defence. In such circumstances, the plaintiff is not
required to undergo a full fledged trial and the Court
below was not required to independently reassess the
plaintiff's evidence. Non-compliance with conditional
leave under Rule 3(6)(b) of Order XXXVII of CPC
leaves the Court with no discretion except to pass
judgment forthwith. Order XXXVII of CPC cannot be
equated with an ex-parte decree in an ordinary civil
suit, since in a summary procedure, the statutory
consequences operate automatically.
10. In the present case, defendant has
admittedly failed to comply with the condition imposed
therefore, plaintiff shall be entitled the judgment
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forthwith. The intention of the legislature is very clear
which has been upheld by series of decisions of the
Hon'ble Apex Court as well as of the High Courts of
different States. The conditional order, in the present
case, as admitted by the appellant, was not complied
with even after time for compliance was extended by
this Court. The principal amount under decree was
deposited by appellant - defendant only after filing the
present First Appeal. Compliance with the conditional
order after the passing of judgment and decree is of no
importance in setting aside the judgment and decree.
Such deposit is not a compliance of conditional leave.
Deposit of Rs.75,000/- after the passing of judgment
and decree is nothing but an attempt on the part of
the plaintiff in getting the appeal admitted.
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11. In such cases of non-compliance of
condition, plaintiff is not expected to lead oral
evidence and he is not required to produce original
documents since the provisions contained in Sub-clause
(b) of Sub-rule (6) of Rule (3) of Order XXXVII of Code
envisages a decree shall be followed forthwith upon
such non-compliance of conditional order. Had the
defendant not appeared in the suit and not filed any
leave to defend affidavit and on non-appearance of
defendant, judgment and decree is passed only under
such circumstances, plaintiff is required to submit
affidavit in lieu of examination-in-chief as
contemplated under Order XVIII Rule 4 of CPC and
also has to produce original documents in support of
claim. However, in the eventuality of non-compliance
of the conditional order, plaintiff is not required to led
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any evidence to prove its case.
12. In the case of National Commodity Clearing
(supra), facts akin to the present case arose before the
High Court of judicature at Bombay. While discussing
the question paused before the Court, in paragraph 18,
the Hon'ble High Court has observed that even in
absence of an application seeking ex-parte decree, the
objection raised by defendant is untenable. There is no
requirement to file any application seeking ex-parte
decree against the defendant on non-compliance of
conditional order. In para 18, the Bench observed as
under:-
"18. I am afraid, I am unable to appreciate the submissions made
by Mr.Modi, learned Senior Counsel appearing for the Defendant. As
has been noted above and in the order dated 2nd April 2025,
Mr.Setalvad on behalf of the Plaintiff had already made an
application for ex-parte decree pursuant to paragraph 73(iii) of the
order granting conditional leave along with certificate of non-
deposit. There is no requirement that the said application be made
in writing. Therefore, this objection is untenable. Secondly, the
reliance by Mr.Modi on paragraphs 70, 71 and 72 to submit that no
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judgment can be given forthwith is also not tenable in view of the
two decisions cited above where it has been held that:
(i) in a case where the Defendant had not complied with the
conditional order in making deposit of the amount upon which leave
to defend was granted, reading of Order XXXVII Rule 3(6)(b) of the
CPC makes it clear that on failure of the Defendant to comply with
the condition imposed by the Court, the Plaintiff is entitled to
judgment forthwith;
(ii) when the Defendant fails to comply with the conditional order
passed under Order XXXVII of the CPC, the Defendant is precluded
from further contesting the Plaintiff's claim and that the facts stated
in 23-COMSS-32-2020.doc the plaint must be considered to have
been admitted by the Defendant and the Plaintiff becomes entitled to
judgment;
(iii) Order XXXVII not only provides for abridgment of the procedure
of Suits covered by the said provisions but also the said provisions
restrict and / or curtail the rights of the Defendant in these Suits to
contest the Plaintiff's claim.
12. In the case of K.R.Patel Huf (supra), order of
conditional leave to defend was not complied with by
the defendant. However, the learned Court below
therein recorded that the suit to proceed without the
Written Statement of the defendant. The plaintiff was
proceeded on the basis that written statement has not
been filed by defendant and applied provisions when
defendant does not file written statement. In paras 5, 7
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and 8, the High Court of Bombay has observed under:-
5. Heard the Learned Counsel for the parties. The Learned
Counsel appearing on behalf of the Petitioner/original Plaintiff
Shri. BGP. 4 of 7 WP-1857-15.doc 09.03.2015 Sharan Jagtiani
would contend that the procedure adopted by the Trial Court is
contrary to the procedure prescribed by Order XXXVII Rule (3)
(6)(b) of the CPC. The Learned Counsel would contend that
once the condition by which leave was granted has not been
complied by the Defendants, the Plaintiffs are entitled to a
judgment. The Learned Counsel seeks to rely upon a judgment
of the Division Bench of this Court reported in AIR 1989
Bombay 150 in the matter of M/s. D. Shanalal and etc. Vs.
Bank of Maharashtra and also the judgment of a Learned Single
Judge of the Delhi High Court reported in AIR 1995 Delhi 252
in the matter of Standard Chartered Bank Vs. M. S. Handa and
others
7. Having heard the Learned Counsel for the parties, in my
view the course of action that is proposed to be followed by
the Trial Court can be said to be in contravention of the
mandate of Order XXXVII Rule (3)(6) (b) of the CPC. A reading
of the said provision makes it clear that on failure of the
Defendant to comply with the condition imposed by the Court,
the Plaintiff is entitled to judgment forthwith. The said
provision BGP. 5 of 7 WP-1857-15.doc 09.03.2015 was the
subject matter of the judgment of a Division Bench of this
Court in M/s. D. Shanalal's case (supra), where the Division
Bench has observed that when the Defendant fails to comply
with a conditional order passed under Order XXXVII, the
Defendant is precluded from further contesting the plaintiff's
claim and that the facts stated in the plaint must be considered
to have been admitted by the Defendant and the Plaintiff
becomes entitled to judgment. The Division Bench has further
observed that Order XXXVII not only provides for abridgment of
the procedure of suits covered by the said provisions but also
the said provisions restrict and/or curtail the rights of the
Defendants in these suits to contest the Plaintiff's claims.
8. In so far as the judgment in Standard Chartered Bank's case
(supra) is concerned, a Learned Single Judge of the Delhi High
Court in the said case has relied upon the judgment of the
Division Bench of this Court in M/s. D. Shanalal's case (supra),
the Learned Single Judge has reiterated the proposition of law
that the condition having not been fulfilled by the Defendant,
leave to defend would be deemed to have been refused to the
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said Defendant and the Plaintiff becomes entitled to a judgment.
In the light of the aforesaid judgments, it is not possible to
countenance the submissions urged on behalf of the Defendants
by Shri. Javeed Hussein. There is no scope for any further
enquiry and the Plaintiff BGP. 6 of 7 WP-1857-15.doc
09.03.2015 would be entitled to judgment forthwith. The Trial
Court would therefore have to proceed on the basis that the
claim in the plaint is accepted and has to proceed to pass
judgment in terms of the law which has been enunciated by the
Division Bench of this Court in M/s. D. Shanalal's case (supra).
With the aforesaid observations, the Writ Petition is disposed of.
The Learned Counsel to inform the developments in the above
Writ Petition to the Trial Court when the suit comes up for
hearing. The above Writ Petition is allowed to the aforesaid
extent. Rule is accordingly made absolute in the aforesaid
terms, with parties to bear their respective costs.
13. In the background of the above stated facts
and in light of the settled proposition of law, in my
view, the judgment and decree passed by the learned
Court below is legal and as per the provisions
contained in Order XXXVII Rule 3(6)(b) of the CPC.
Resultantly, First Appeal fails and the same is
dismissed. Record and proceedings be sent back to the
concerned Court. No order as to costs.
(D. M. DESAI,J)
MANOJ
