M/S. Nipro Medical India Private ... vs Brs Health And Research Institute ...
2022 Latest Caselaw 4313 Tel

        HONOURABLE SRI JUSTICE P.NAVEEN RAO

                                   AND

        HONOURABLE DR. JUSTICE G.RADHA RANI

               Civil Revision Petition No.797 of 2022

                            Date:26.08.2022
Between:
M/s.Nipro Medical India Private Limited,
a company registered under the Companies Act, 1956,
having its Corporate Office at Rajiv Gandhi International Airport,
2nd Floor, GMR Aero Towers, Shamshabad, Hyderabad - 500 108,
Represented by its Authorized Officer Mr. G. Sridhar,
Manager-Account Receivables & Commercial Support

                                                                ... Petitioner

And

BRS Health and Research Institute Private Limited,
NG 17, North Block Ground Floor,
Manipal Centre, Dickenson Road,
Bengaluru - 560 042 and another

                                                             ... Respondents

This Court made the following:

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THE HONOURABLE SRI JUSTICE P. NAVEEN RAO

AND

THE HONOURABLE DR. JUSTICE G. RADHA RANI

Civil Revision Petition No.797 of 2022

ORDER : (per Hon'ble Dr. Justice G. Radha Rani)

This Civil Revision Petition is filed by the petitioner

aggrieved by the order dated 11.03.2022 passed in Interlocutory

Application No.22 of 2022 in C.O.S.No.60 of 2021 on the file of

the Special Judge for Trial and Disposal of Commercial Disputes,

Ranga Reddy District, at L.B.Nagar.

2. The Revision Petitioner herein is the plaintiff in

C.O.S.No.60 of 2021 and respondent in Interlocutory Application

No.22 of 2022 in Commercial OS.No.60 of 2021.

3. The parties are hereinafter referred as plaintiff and

defendant. C.O.S.No.60 of 2021 was filed by the plaintiff under

Order XXXVII of the Civil Procedure Code, 1908 for recovery of

a sum of Rs.69,44,57,832/- with contractual rate of interest @ 21% ::3:: PNR,J & Dr.GRR,J crp_797_2022

per annum from the date of the suit. The said suit is a summary

suit, filed basing on the contractual agreement dated 30.08.2017.

4. Interlocutory Application No.22 of 2022 in COS.No.60 of

2021 was filed by the 1st defendant seeking leave of the Court to

defend the summary suit.

5. The Managing Director of the 1st defendant filed an affidavit

in support of the petition requesting the Court to treat the Written

Statement filed in the suit as part and parcel of the application. It

is stated that he received the notice on 16.12.2021 and filed

Vakalat on 27.12.2021, and prayed leave of the Court to defend the

said suit.

6. The respondent / plaintiff filed counter-affidavit contending

that the I.A. was filed beyond the mandatory time prescribed under

Rule 3(5) of Order XXXVII CPC and, therefore, they were entitled

for a judgment forthwith under Rule 3(6)(a) of Order XXXVII of

CPC. Summons for judgment in Form - IV(A) were served on the

1st defendant on 03.01.2022. The mandatory ten (10) day period

prescribed for filing the application to leave to defend under Rule ::4:: PNR,J & Dr.GRR,J crp_797_2022

3(5) expired on 13.01.2022; since 13.01.2022 fell within the

Pongal Vacation, the same ought to have been filed on the re-

opening day, i.e., on 17.01.2022 vide Section 10 of the General

Clauses Act, 1897. But, the present application was filed on

18.01.2022. Therefore, the plaintiff is entitled for judgment under

Rule 3(6)(a) of Order XXXVII of CPC.

6.1 The plaintiff contended that the facts required to be pleaded

for leave to defend were not raised, instead a request was made to

read the contents of the Written Statement as part of the affidavit;

when the Written Statement could not be taken on file, without

leave being granted, request to read the contents of the Written

Statement as part of the affidavit was without any basis, and the

said I.A. was liable to be rejected.

6.2 He further contended that grant of leave to defend the suit

under Rule 3(5) of Order XXXVII CPC was guided by the

principles laid down by the Hon'ble Apex Court; the 1st defendant

in his Written Statement had taken three Defences, viz., ::5:: PNR,J & Dr.GRR,J crp_797_2022

(1) that the plaintiff had pleaded falsehood and

approached the Court with unclean hands by stating that "no

relief was sought against (Government of Karnataka), and

therefore, no notice under Section 80 was required", though

relief of attachment of equipment had been sought and,

therefore, the suit was liable to be dismissed on the said

ground;

(2) that the agreements dated 30.08.2017, 29.12.2018,

01.01.2019, 26.09.2019, 26.10.2019 and agreement

concerning Koosamma Hospitals were invalid as they were

improperly stamped and, therefore, no claim could be set-up

under the said documents; and

(3) that the Court has no territorial jurisdiction to try the

above suit.

6.3 Further, with respect to the Defence No.1 taken by the

1st defendant, the plaintiff contended that the 1st defendant had no

locus to raise such an objection; and such an objection can be taken

only by the 2nd defendant / Government of Karnataka as per the ::6:: PNR,J & Dr.GRR,J crp_797_2022

law laid down by the Courts and not by any other party to the suit.

Even considering that such a notice was required to be issued

under Section 80, the party to which such notice was required to be

issued could itself waive such issuance of the said notice. Order

XXXVIII Rule 5 of CPC conferred power on the Courts to grant an

order of attachment with respect to the properties of the defendant

which were lying with the third-parties to the suit. Therefore, the

1st respondent / plaintiff could have sought attachment of the

properties of the petitioner / 1st defendant lying with the

Government of Karnataka without making it as a party to the suit.

Inspite of the same, and by way of abundant caution, the

Government of Karnataka was impleaded as 2nd defendant as eo

nominee party to the suit though no claim or relief was sought

against it. The impleadment of Government of Karnataka as 2nd

defendant was made to meet the possible objection that without the

Government of Karnataka being a party to the suit, it could not be

made a party to the I.A.s, which I.A's were filed along with the

suit under Order XXXVIII Rule 5 and 6 of C.P.C. for attachment

of money and equipment of the 1st defendant lying with the ::7:: PNR,J & Dr.GRR,J crp_797_2022

2nd defendant. There was no privity of contract of no kind between

the plaintiff and the 2nd defendant. Consequently, the plaintiff

neither had any claim or right against the 2nd defendant nor the

2nd defendant was liable to the plaintiff in whatsoever manner.

Thus, there was no cause of action of any kind for the plaintiff

against the 2nd defendant, and therefore, no notice under Section 80

was required to be issued.

6.4 He further contended that the purpose and object of Section

80 of C.P.C. was only to afford an opportunity to the Government

to scrutinise the purported claim of the plaintiff, if any, and to

settle the same by immediate action to avoid unnecessary litigation

and to save public time and money. But, neither such situation had

arisen in the facts of the case, nor such object got sub-served by

issuing a notice contemplated thereunder as there was neither

claim nor cause of action for the plaintiff against the 2nd defendant

so that the 2nd defendant could consider and settle, nor any relief

was sought against the 2nd defendant. As such, Section 80 of

C.P.C. has no application to the facts of the present case and ::8:: PNR,J & Dr.GRR,J crp_797_2022

consequently no notice was required to be issued to the

2nd defendant under Section 80.

6.5 With regard to Defence No.2 that the Agreements were

insufficiently stamped, the plaintiff contended that still such

agreements were not invalid in law and claims could be set-up

under such agreements as they were only inadmissible in evidence,

if they were improperly stamped, that too when they were tendered

in evidence. The defence of insufficiency of stamp duty and

inadmissibility of the said document was a curable defect which

could be cured at the stage of the trial when they were sought to be

tendered in evidence. The Courts had held that it was not a sword

but was only a shield. The Indian Stamp Act was a fiscal measure

enacted to secure the revenue for the State on certain clauses of

instruments and "it is not enacted to arm the litigant with a weapon

of technicality to meet the case of the opponent". Therefore, it

could not be a defence at all and consequently could not be a

ground to seek relief to defend. The said stage of tendering of

document in evidence would arise only after pleadings were

completed including filing of written statement, issues were ::9:: PNR,J & Dr.GRR,J crp_797_2022

framed and trial commenced. In other words, once relief was

granted and consequently written statement was filed and trial

commenced and in the said trial, if such documents were tendered

in evidence, such objection could be taken by the opposing party.

Therefore, it could not be treated as a defence at this stage.

6.6 With regard to the merits of Defence No.2, the plaintiff

further contended that the suit pertained to only three out of the six

agreements, i.e., Agreement dated 30.08.2017, Invoice dated

26.09.2019 and Invoice dated 26.10.2019. The other three

Agreements, viz., Agreement dated 29.12.2018, Agreement of

Sub-Lease dated 01.01.2019 and Agreements with respect to

Koosamma Hospitals were not subject matter of the suit, and the

dues under the said three contracts were not sought to be recovered

in the suit. Therefore, the objections with respect to the above

three contracts had to be straight away rejected as frivolous and no

leave needed be granted with respect to the said objection of

'insufficiency of stamp duty' with respect of the said three

agreements.

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                                                             crp_797_2022

6.7 With regard to the other three contracts which were subject

matter of the suit, the plaintiff contended that the invoices dated

26.09.2019 and 26.10.2019 would not need any stamp duty as they

were contracts by themselves and the dues thereunder could be

recovered independently and also under the provisions of the Sale

of Goods Act, 1930. With regard to the Agreement dated

30.08.2017, he submitted that no particulars or details were

submitted in support thereof as to the description of the document

and the nomenclature to be given to the same whether it was

"agreement to sell" or "agreement of sale" or any other document

as to which Article of Schedule-I of the Karnataka Stamp Act,

1957 was attracted; as to the stamp duty required to be paid so as

to contend that Rs.200 paid as stamp duty towards such agreement

dated 30.08.2017 was deficient; as to the quantum of deficiency of

stamp duty; and as to which party under the law was required to

pay the stamp duty; and therefore, the petition was liable to be

rejected as it is vague, contrary to law of pleadings.

6.8 The plaintiff further contended that the Agreement dated

30.08.2017 was only an "agreement to sell" and not "agreement of ::11:: PNR,J & Dr.GRR,J crp_797_2022

sale". It was an agreement of future sale, and no sale had taken

place under the said agreement. As per the said agreement, vide

Clause No.1 of "Part-A Equipment" thereof, it was evident that the

plaintiff was required to supply 300 to 500 medical equipments in

future, i.e., in the ensuing period of five years. Further, even the

said supply was only upon the 1st defendant raising a purchase

order on the plaintiff specifying the quantity and type, etc., of the

equipment and the location, address where it was required to be

supplied. Only upon such purchase order being raised, the plaintiff

was required to supply or sell. If any purchase order was not

raised by the 1st defendant, the plaintiff was not bound to supply

and consequently there would be no sale, and question of

conveyance of title in such movable properties would not arise.

Therefore, the contract dated 30.08.2017 was properly stamped

and was valid and it would fall under Article 12 of Schedule-I.

6.9 Without prejudice to the said contentions, the plaintiff

further submitted that independent of the said Agreement dated

30.08.2017, the plaintiff was entitled to recover the amount basing

on the invoices or under the provisions of the Sale of Goods Act, ::12:: PNR,J & Dr.GRR,J crp_797_2022

1930 or acknowledgment of debts made by the 1st defendant. He

contended that the money sought to be recovered was fallen due to

the plaintiff under (47) invoices under which all the goods

(medical equipment) were supplied to the 1st defendant. Therefore,

de hors the said Agreement dated 30.08.2017, the plaintiff was

entitled to recover the same under the said invoices independently.

As per law, such invoices were not required to be stamped under

the Indian Stamp Act. The plaintiff was entitled to recover the said

amount under the provisions of the Sale of Goods Act, 1930

independent of the said Agreement dated 30.08.2017. The plaintiff

was also entitled to recover the said dues under the

acknowledgment of dues without recourse to the said Agreement

dated 30.08.2017.

6.10 He further submitted that the stamp paper on which the

Agreement dated 30.08.2017 was printed was purchased by the 1st

defendant apart from the fact that under Section 30 of Karnataka

Stamp Act, 1957 the purchaser was required to pay the stamp duty.

Further, the said Agreement dated 30.08.2017 was acted upon by

both parties without demur, and the amounts due had been ::13:: PNR,J & Dr.GRR,J crp_797_2022

acknowledged by the 1st defendant several times which would

constitute acknowledgment of debt under the law. The accounts

between the parties had been reconciled several times and in each

such reconciliation, specific figure of debt was acknowledged as

due by the 1st defendant to the plaintiff; latest such reconciliation

was dated 24.05.2021. Thus, the accounts had been settled and

they would constitute acknowledgment of debt under law. The

Courts had also held that the said acknowledgment of debts by

themselves would constitute a contract and basing on such

acknowledgment of debts, suits were maintainable under Order

XXXVII of CPC.

6.11 He further contended that if the Court would held the 2nd

defence in his favour that he was entitled to recover the said dues

basing on the invoices, provisions of Sale of Goods Act, 1930 or

acknowledgment of debts, then there would be no necessity for

him to rely upon the said Agreement dated 30.08.2017. The

Agreement dated 30.08.2017 in original could be sent to the

competent authority under the provisions of Karnataka Stamp Act,

1957 for adjudication and for further consequential steps to be ::14:: PNR,J & Dr.GRR,J crp_797_2022

taken under the provisions thereof in order to protect the interest of

the public revenue. Inspite of the above submissions made with

regard to defence No.2, if such contentions were held against the

plaintiff he would undertake to pay the deficit stamp duty and

penalty to facilitate the same to be admitted in evidence.

6.12 With regard to Defence No.3, he submitted that vide clause

(5) of the Agreement dated 30.08.2017, the parties deliberately and

consciously agreed to exclude the jurisdiction of all other Courts

except the Courts at Hyderabad. The essential part of cause of

action had arisen at Hyderabad. 1st defendant raised the purchase

orders on the plaintiff at his Corporate Office, at Hyderabad.

Accepting the said purchase orders at Hyderabad, the plaintiff had

supplied the goods. Therefore, the contracts of sale (invoices) got

concluded at Hyderabad. Thus, the 1st defendant was not entitled

for grant of leave to defend the suit.

6.13 He further contended that the 1st defendant had not made

out any grounds, leave alone being plausible or probable defence

so as to grant leave to defend the suit, the defences taken by the

defendant were weak and not bonafide as the 1st defendant had ::15:: PNR,J & Dr.GRR,J crp_797_2022

admitted the supply of goods pursuant to the Agreement dated

30.08.2017 and also put them to use. He also admitted the

amounts due to the plaintiff under numerous acknowledgment of

dues, then turned around to dispute the said agreements that too

only on the ground of "insufficiency of stamp duty". The

1st defendant received legal notice dated 13.07.2022, but did not

bother to reply to the same, but raised the defence of "insufficiency

of stamp duty". The 1st respondent attempted to pre-empt the

plaintiff from availing the legal remedies for recovery pursuant to

the said legal notice by filing COS.No.754 of 2021 at Bangalore,

Admittedly, the stamp had been purchased by the 1st defendant,

and he was now raising the dispute about the payment of stamp

duty thus drawing premium from his own wrong. The

1st defendant diverted the funds to its sister concerns to build

movable and immovable assets for the said concern without paying

the dues of the plaintiff. Though the ownership and title to the

equipment lying with the 2nd defendant vested with the

1st defendant which was agreed to by the Government of Karnataka

under the Agreement dated 10.03.2017 entered between the ::16:: PNR,J & Dr.GRR,J crp_797_2022

1st defendant and the 2nd defendant, still the 1st defendant made

false statement in paragraph No.4 of the purported written

statement that the said equipment was owned by the 2nd defendant.

He made false statement as to the ownership and title to the goods

sought to be attached. The 1st defendant had gone to the extent of

filing Interlocutory Application No.21 of 2022 and Interlocutory

Application (SR).No.118 of 2022 seeking initiation of criminal

proceedings against the plaintiff, directors of which were mostly

not citizens of India i.e., (Japanese and Singapore). The conduct of

1st defendant in filing numerous frivolous interlocutory

applications would only disclose his intention to delay the passing

of the judgment and decree and recovery of the dues.

6.14 As per 2nd proviso to Rule 3(5) of C.P.C., leave to defend

the suit should not be granted unless admitted amount was

deposited by the 1st defendant. Even if leave to defend was

granted, it should have to be conditional viz., on condition that the

1st defendant depositing the entire amount claimed in the suit as a

condition to defend the suit, and prayed to dismiss the I.A.

                                   ::17::                 PNR,J & Dr.GRR,J
                                                             crp_797_2022

7. On hearing both the learned counsel for the petitioner / 1st

defendant and 1st respondent / plaintiff, the Special Court for Trial

and Disposal of Commercial Disputes, Ranga Reddy District, at

L.B.Nagar allowed the petition by granting leave to the petitioner /

1st defendant to defend the suit.

8. Aggrieved by the said order, the 1st respondent / plaintiff

filed the present Civil Revision Petition contending that the trial

court erred in following the guidelines in the case of M/s.

Mechelec Engineers and Manufacturers vs. Basic Equipment

Corporation1 which was superceded by the decision of the

Hon'ble Apex Court in IDBI Trusteeship Services Limited vs.

Hubtown Limited2; the trial court failed to consider that the case

on hand would fall within the guidelines contained in IDBI

Trusteeship Services Limited (2 supra) and that the petition

seeking leave to defend had to be rejected; the trial court failed to

consider that if the amounts claimed were admitted, then even if

triable issues or substantial defences were raised, still leave could

not be granted unless the admitted amount was deposited as

AIR 1977 SC 77

(2017) 1 S.C.C. 568 ::18:: PNR,J & Dr.GRR,J crp_797_2022

provided under the 2nd proviso to Sub-Rule (5) of Rule 3 of Order

XXXVII CPC and paragraph No.17.6 of the decision in IDBI

Trusteeship case, read with paragraph No.19 thereof; the Trial

Court erred in distinguishing the precedents in law on the ground

of quantum of money sought to be recovered in the facts of the

cases cited. The trial court erred in distinguishing the precedents

in law on the ground that the facts of the cited cases were not the

same and similar to the facts of the case on hand, instead of

following the declaration of law in the said citations, the Trial

Court failed to consider and gave findings with respect to each of

the preliminary issues raised as to the maintainability of the I.A.

which would go to the root of the matter; the contention of the

plaintiff that the procedure under Order XXXVII had to be

scrupulously followed, was totally ignored by the Trial Court; the

Trial Court failed to consider the contention of the plaintiff that

assuming that the Agreement dated 30.08.2017 was insufficiently

stamped, still the plaintiff could alternatively base its claim for

recovery of money under the invoices, under the provisions of Sale

of Goods Act and the acknowledgment of debts which were held to ::19:: PNR,J & Dr.GRR,J crp_797_2022

be contracts by themselves falling under Rule 1 of Order XXXVII

of C.P.C. and the citations submitted in support thereof; the Trial

Court failed to consider that the defendant was estopped under law

to take such frivolous, vexatious, sham and moonshine defences

and having acted on the said agreement, placed purchase orders as

per the said agreement, received the goods under invoices without

demur, put them to use, made part payments, acknowledged the

debts by several documents and having reconciled the accounts

and confirmed the debts due by the defendant to the plaintiff and

also not being its case that such dues were not payable; the Trial

Court failed to take note that Order XXXVII was applicable to

commercial cases and that the trading and commercial operations

were liable to be seriously impeded, if, in particular money

disputes between the parties were not adjudicated upon

expeditiously and the case on hand would squarely fall within the

same object; the Trial Court failed to consider the contentions

raised with regard to the purported defence of Section 80 of C.P.C.

notice; the Trial Court ordered notice to the Government of

Karnataka in Interlocutory Application Nos.428 and 429 of 2021 ::20:: PNR,J & Dr.GRR,J crp_797_2022

and having received the notices on 16.12.2021, the Government of

Karnataka did not choose to appear; thereafter, the Trial Court

again ordered notice for the second time and the said notice was

served on the Government of Karnataka on 02.03.2022, but again

the Government of Karnataka did not choose to appear in the suit;

and consequently, the Trial Court had set the Government of

Karnataka ex parte vide order dated 07.03.2022; the Trial Court

failed to consider the contention of the plaintiff that the plea of

insufficiency of stamp duty was a technical plea; the Trial Court

approached and considered the lis with a pre-determined mind

without looking into the documents, acknowledgment of debts and

written confirmation of debts; the Trial Court erred in referring to

Commercial O.S.No.754 of 2021 without considering the scope of

the relief sought in the said suit, and how the pendency of the suit

was an impediment for proceeding with this suit or I.A.; the Trial

Court failed to consider the contention of the petitioner that part of

cause of action had arisen at Shamshabad which was within the

territorial jurisdiction of the Court and wrongly understood the

ratio decidendi laid down in the precedents of law cited in support ::21:: PNR,J & Dr.GRR,J crp_797_2022

of the above contention; and prayed this Court to allow the Civil

Revision Petition.

9. Heard Mr. M. Ravindranath Reddy, learned Senior Counsel

representing Mr. B. Srinarayana, for the Revision Petitioner; and

Mr. Syed Razzaq Ahmed, learned counsel for the 1st respondent /

1st defendant.

10. Both the learned counsel had vehemently argued the matter

at length, and the learned Senior Counsel for Revision Petitioner

referred to several decisions of the Hon'ble Apex Court as well as

other High Courts, and submitted that the written arguments filed

by him before the Trial Court were not properly considered by the

trial court.

11. Now, the point for consideration is, "whether the order

dated 11.03.2022 passed in Interlocutory Application No.22 of

2022 in COS.No.60 of 2021 by the Trial Court granting leave to

defend the suit to the 1st respondent / 1st defendant is in accordance

with law?"

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                                                                                     crp_797_2022

12. Order XXXVII of Civil Procedure Code, 1908 deals

with Summary Suits and Order XXXVII Rule 23 prescribes how a

Rule 2 Order XXXVII - Institution of summary suit :

(1) A suit, to which this Order applies, may if the plaintiff proceed desires to desires hereunder, be instituted by presenting a plaint which shall contain,-

(a) a specific averment to the effect that the suit is filed under this Order;

(b) that no relief, which does not fall within the ambit of this rule; has been claimed in the plaint; and

(c) the following inscription, immediately below the number of the suit in the title of the suit, namely :- "(Under Order XXXVII of the Code of Civil Procedure, 1908)." (2) The summons of the suit shall be in Form No. 4 in Appendix B or in such other Form as may, from time to time, be prescribed. (3) The defendant shall not defend the suit referred to in sub-rule (1) unless he enters an appearance and in default of his entering an appearance the allegations in the plaint shall be deemed to be admitted and the plaintiff shall be entitled to a decree for any sum, not exceeding the sum mentioned in the summons, together with interest at the rate specified, if any, up to the date of the decree and such sum for costs as may be determined by the High Court from time to time by rules made in that behalf and such decree may be executed forthwith."

Rule 3 Order XXXVII - Procedure for the appearance of defendant :

(1) In a suit to which this Order applies, the plaintiff shall, together with the summons under rule 2, serve on the defendant a copy of the plaint and annexures thereto and the defendant may, at any time within ten days of such service, enter an appearance either in person or by pleader and, in either case, he shall file in Court an a address for service of notices on him.

(2) Unless otherwise ordered, all summonses, notices and other judicial processes, required to be served on the defendant, shall be deemed to have been duly served on him if they are left at the address given by him for such service. (3) On the day of entering the appearance, notice of such appearance shall be given by the defendant to the plaintiff's pleader, or, if tile plaintiff sues in person, to the plaintiff himself, either by. notice delivered at or sent by a pre-paid letter directed to the address of the plaintiff's pleader or of the plaintiff, as the case may be. (4) if the defendant enters an appearance, the plaintiff shall thereafter serve on the defendant a summons for judgment in Form No. 4A in Appendix B or such other Form as may be prescribed from time to time, returnable not less than ten days from the date of service supported by an affidavit verifying the cause of action and the amount claimed and stating that in his belief there is no defence to the suit. (5) The defendant may, at any time within ten days from the service of such summons for judgment, by affidavit or otherwise disclosing such facts as may be deemed sufficient to entitle him to defend, apply on such summons for leave to defend such suit, and leave to defend may be granted to him unconditionally or upon such terms as may appear to the Court or Judge to be just:

Provided that leave to defend shall not be refused unless the Court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial ::23:: PNR,J & Dr.GRR,J crp_797_2022

summary suit to be instituted and Sub-Rule (3) provides procedure

for the appearance of the defendant.

Rule 3 had been amended vide Civil Procedure Code

Amendment Act 104 of 1976 w.e.f. 01.02.1977 adopting the

Bombay Amendment to provide the procedure for appearance of

the defendant, obtaining of leave to defend and hearing, etc. In a

summary suit, the defendant is not entitled as of right to put in a

defence. He can apply for leave within ten (10) days from service

of summons by complying with the conditions in Rule 3. The

limitation period of ten (10) days for leave to defend shall be

computed from the date of service of summons for judgment and

defence to raise or that the defence intended to be put up by the defendant is frivolous vexatious:

Provided further that, where a part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit shall not be granted unless the amount so admitted to be due is deposited by the defendant in Court.

(6) At the hearing of such summons for judgment,-

(a) if the defendant has not applied for leave to defend, or if such application has been made and is refused, the plaintiff shall be entitled to judgment forthwith; or

(b) if the defendant is permitted to defend as to the whole or any part of the claim, the Court or Judge 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.

(7) The Court or Judge may, for sufficient cause shown by the defendant, excuse the delay of the defendant in entering an appearance or in applying for leave to defend the suit."

                                  ::24::                  PNR,J & Dr.GRR,J
                                                             crp_797_2022

not from the date of service of summons of the suit. The defendant

should move within ten (10) days from the date of service of such

summons for judgment, by affidavit or otherwise disclosing such

facts as may be due sufficient to entitle him to defend, apply on

such summons for leave to defend. Where the defendant failed to

appear within ten (10) days and did not apply for leave to defend,

the plaintiffs are entitled to a decree. Where the affidavit filed by

the defendant discloses a triable issue, i.e., at least, plausible, leave

should be granted. But, when defence raised appears to be moon-

shine and sham, leave to defend should be refused. Where the

Court grants any conditional leave to defend, it must record

reasons. The trial court has to apply its mind to the material placed

on record by defendant while seeking leave to defend the suit. The

order granting leave to defend must show appreciation of material

by the Trial Court while recording of conclusion about triable issue

raised by the defendant. It is not only enough to disclose the

defence by the defendant, but he has to establish that such defence

is dependable and acceptable prima facie for proceeding further.

                                ::25::                PNR,J & Dr.GRR,J
                                                         crp_797_2022

13. In the light of the above principles, the order passed by the

Trial Court has to be looked into.

As seen from the facts of the case, the 1st defendant was

successful in the tender floated by the Government of Karnataka

(2nd respondent) and entered into a contract dated 10.03.2017 with

the 2nd defendant for running the dialysis services in the

Government Hospitals of 2nd defendant. To perform its

obligations under the said contract, the 1st defendant entered into

an Agreement dated 30.08.2017 with the plaintiff for supply of

dialysis equipment, other equipment, consumables etc. In

accordance with the terms of the agreement, the 1st defendant

placed purchase orders on the plaintiff for supply and sale of goods

(medical equipment). Accepting such purchase orders, the plaintiff

supplied medical equipment under forty-seven (47) invoices. Part

payments were made by the 1st defendant towards the said sale

consideration. The factum of the part payments was admitted by

the 1st defendant vide reconciliation of accounts. The balance sale

consideration due was admitted / acknowledged by the

1st defendant apart from reconciliation of accounts and ::26:: PNR,J & Dr.GRR,J crp_797_2022

consequential confirmation of the debt. As per the plaintiff, the

last part payment was made by the 1st defendant on 03.03.2021 for

Rs.2,18,05,141/-. The plaintiff got issued a legal notice dated

13.07.2021 for recovery of the amount due to him. The

1st defendant had not issued any reply to the said legal notice.

Consequently, the plaintiff filed the suit under Order XXXVII of

CPC by paying a Court Fee of about Rs.70 lakhs. When the suit

reached the stage of Rule 3(5) of Order XXXVII, the Interlocutory

Application No.22 of 2022 is filed by the petitioner / 1st defendant

seeking leave to defend along with the written statement.

14. On a perusal of the contents of the said I.A., the facts

required to be pleaded for leave to defend had not been raised by

the 1st defendant, and instead a request was made to read the

contents of the Written Statement as part of the affidavit. When

the Written Statement itself could not be taken on file without

leave being granted, requesting to read the contents of the said

Written Statement as part of the affidavit is contrary to law.

                                        ::27::                    PNR,J & Dr.GRR,J
                                                                     crp_797_2022

15. The learned Senior Counsel for the revision petitioner relied

on the decision of the High Court of Rajasthan in Smt. Maha Devi

vs. Ravi Kumar4, wherein it held at para No.7 as follows :

"7. In the case on hand no application seeking leave to defend the suit was even filed by the defendant but contrary to the provisions of law written statement was filed as of right along with application under Order 37 Rule 3(7) CPC seeking condonation of delay in filing the written statement. Rule 3(5) of Order 37 requires two things : (1) an application by the defendant for leave to defend and (2) a disclosure upon affidavit of such facts as require proof of consideration or as are considered by the Court to be sufficient to support the application. A mere application for leave to defend is not enough. Thus, in the absence of an application supported by the affidavit under Order 37 Rule 3(5) if written statement is filed by the defendant, it cannot be taken on record."

16. Grant of leave to defend the suit under Order XXXVII Rule

3(5) is guided by the principles laid down by the Hon'ble Apex

Court in IDBI Trusteeship Services Limited (1 supra). It was

held that:

"17. Accordingly, the principles stated in para 8 of Mechelec Engineers & Manufacturers v. Basic Equipment

AIR 1998 Raj 274 ::28:: PNR,J & Dr.GRR,J crp_797_2022

Corporation5 will now stand superseded, given the amendment of Order 37 Rule 3 and the binding decision of four Judges in Milkhiram (India) (P) Ltd. Vs. Chamanlal Bros.6, 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

(1976) 4 SCC 687

AIR 1965 SC 1698 ::29:: PNR,J & Dr.GRR,J crp_797_2022

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."

17. Parties cannot defeat the object of Order XXXVII Rule 3(5)

by raising defences which are frivolous, sham and moonshine. The

Court has to consider each of such defences and give a finding

with reasons. But, a perusal of the order of the Trial Court would

disclose that no reasons were assigned to the various defences

raised by the petitioner / 1st defendant to consider whether such

defences were substantial or not.

18. With regard to the defence taken by the 1st defendant that no

notice was given to 2nd defendant under Section 80 of CPC, the ::30:: PNR,J & Dr.GRR,J crp_797_2022

plaintiff pleaded that no relief was sought against Government of

Karnataka and, therefore, no notice under Section 80 of CPC was

required. He also contended that such objection could be taken

only by the 2nd respondent as per the decision of High Court of

Karnataka in Manjunath Kashi Kumtakar (deceased) by L.R.s

vs. Jainabi Kom Sayyed Idrus Khazi (Deceased) by L.R.s7,

wherein it was held as follows :

"21.. ... ... ... The learned counsel for the appellant contended that no valid notice under Section 80 CPC had been issued to the Government and that as regarding want of notice under Section 80, CPC is available only to the Government or the public officer and not to a third-party. It is well-settled that the Government can waive this notice. In this case the trial court has held that the notice issued by the plaintiff amounts to notice under Section 80, CPC. The Government has not challenged the judgment and decree of the trial court. As such, it must be held that the Government has accepted the finding of the trial court that notice under Section 80, CPC had been issued to it. It is not open to the second defendant-appellant either to challenge that finding or contend that the suit is barred under Section 80, CPC for want of a valid notice."

19. Learned Senior Counsel for the revision petitioner further

contended that having received the summons on 16.12.2021 and

(1995) 3 K.L.J. 114 ::31:: PNR,J & Dr.GRR,J crp_797_2022

again for the second time on 02.03.2022, the 2nd defendant

(Government of Karnataka) had not chosen to appear in the suit

and it was set ex parte vide order dated 07.03.2022. Therefore, it

was deemed that it had no interest in the lis between plaintiff and

1st defendant and, at any rate, the plaintiff had not sought any relief

or decree against the 2nd defendant. He also contended that

without prejudice to the above contentions, Order XXXVIII Rule 5

would confer power on the Courts to grant an order of attachment

with respect to the properties of the defendant lying with third

parties to the suit including Government, and placed reliance on

the judgment of the High Court of Andhra Pradesh in Surender

Singh Bajaj vs. M/s. Kitty Steels Ltd.8 wherein it was held as

follows :

"23. The further opinion of the learned Judge in J. Balakrishna's case (1 supra) that the attachment before judgment could be ordered only against the defendant and cannot be ordered against the third party, in my considered opinion, does not seem to be correct proposition of law.

24. Order 38 Rule 7 CPC provides that the attachment under Order 38 Rule 5 shall be made in the manner provided

2002 (2) A.P.L.J. 226 (H.C.) ::32:: PNR,J & Dr.GRR,J crp_797_2022

in the attachment of property in execution decree. It is trite, the attachment envisaged under Order 38 Rule 5 CPC is an attachment before judgment. The restriction found by the learned single Judge that under Order 38 Rule 5, only the properties of the defendant can be attached and not the properties in the hands of garnishee has no statutory support nor the support of any precedent. ... ... .."

Therefore, in the case on hand, the plaintiff could seek

attachment of the properties of 1st defendant lying with the

Government of Karnataka even without making it as a party to the

suit.

20. The contention of the learned Senior Counsel for the

revision petitioner was that there was no privity of contract of any

kind between the plaintiff and the 2nd defendant. The plaintiff

neither has any claim or right against the 2nd defendant, nor the 2nd

defendant was liable to the plaintiff in whatsoever manner. Thus,

there was no cause of action at any time for the plaintiff against the

2nd defendant and, therefore, no notice under Section 80 was

required to be issued.

21. The purpose and object of Section 80 CPC was only to

afford an opportunity to the Government to scrutinise the claim of ::33:: PNR,J & Dr.GRR,J crp_797_2022

the plaintiff, if any, and to settle the same by immediate action to

avoid unnecessary litigation and to save public time and money.

Neither such situation had arisen in the facts of the present case nor

such object got sub-served by issuing a notice contemplated

thereunder as there was neither claim nor cause of action for the

plaintiff against the 2nd defendant so that the 2nd defendant could

consider and settle the claim of the plaintiff.

22. Learned Senior Counsel for the revision petitioner relied

upon the decision of the High Court of Andhra Pradesh in

Kolanati Satyanarayana vs. Nizampatnam Mastan9, wherein

the learned Single Judge held as follows :

"9. The objection as to the non-issuance of notice under Section 80 C.P.C. is equally untenable, because of the reason that respondents 1 to 4 did not claim any relief against the Government or its officials. On the other hand, they based their claim on Ex.A.1 issued by the Government. The necessity to issue a notice under Section 80 C.P.C. arises, if only, any action of the Government is challenged. From their angle, it was sufficient if the appellants herein were injuncted from interfering with their right from removing the clay."

    (2007) 1 ALD 497
                                           ::34::                     PNR,J & Dr.GRR,J
                                                                         crp_797_2022

23. He also relied on the decision of High Court of Andhra

Pradesh in Smt. Achanta Chaya Devi vs. State of Telangana10,

wherein it was held as follows :

"7. Overall, it is manifest that a notice under Section 80 CPC is a condition precedent when the suit instituted seeks relief against the Government or against a public officer in respect of any act purported to be done by him in his official capacity. In the present case, no relief whatsoever is claimed against defendants 1 to 4, the officials of the State. It appears that they have been impleaded only because the petitioner- plaintiff is seeking cancellation of a registered sale deed."

24. In State of Andhra Pradesh vs. T.V. Krishna Reddy

(died) per L.R.s11, a learned Single Judge held as follows :

"22. Section 80 CPC contemplates that the notice shall state the cause of action, name and description and place and residence of the plaintiff and also the relief he claims. It is well settled that the object and purpose of issuing a notice under Section 80 CPC is to bring to the notice of the Government the nature of the claim and the relief proposed to be sought so that an effort can be made to resolve the dispute and settle the claim, if possible without driving the claimant to seek redressal through the Court of law and thereby avoid unnecessary litigation. After all, the State would be defending the claims made against it at the cost of public money and time.

     AIR 2018 AP 148

     2008 (4) A.P.L.J. 66 (H.C.)
                                     ::35::                       PNR,J & Dr.GRR,J
                                                                     crp_797_2022

Wherever possible, the State, as a responsible and responsive instrumentality, shall make every endeavour to settle the claims of the citizens made against it without driving the parties to the Court, charging the public exchequer with unnecessary expenditure. The claim made by a claimant in the form of notice under Section 80 CPC furnishing all necessary and relevant details of the claim affords an opportunity to the State to settle the said claim at the pre-litigation stage itself."

25. Therefore, from the above, it can be inferred that Section 80

of CPC has no application to the facts of the present case, and no

notice was required to be issued to the 2nd defendant under the said

Section. Hence, the defence raised by the 1st defendant with

respect to the notice under Section 80 CPC has no legal basis..

26. With regard to the defence taken by 1st defendant that the

Agreements in question were improperly stamped and, therefore,

no claim could be set-up under the said documents, the said

objection would normally be taken in a suit at the time of trial

when the documents were tendered in evidence for marking. Even

assuming that there was insufficient stamp duty, still such

agreements were not invalid in law, and claims can be set-up under

the said agreements and enforced. The Courts have held that such

contracts are not valid in law, but they are only inadmissible in ::36:: PNR,J & Dr.GRR,J crp_797_2022

evidence if they are improperly stamped, that too, when they are

tendered in evidence.

27. The High Court of Andhra Pradesh in Boottam Pitchiah vs.

Boyapati Koteswara Rao12, held as follows :

"6. It is clear from the language of this that this provision does not make an unstamped promissory note void, but renders only inadmissible. The same has been the prevailing view in Madras and should be taken to govern the State of Andhra Pradesh concerning the enforceability of such unstamped promissory notes. The rest of the decisions referred to also proceed on the same basis. This view cannot therefore be differed from as the same is not also questioned by the learned counsel for the petitioner."

28. Likewise, in Mattegunta Dhanalakshmi vs. Kantamraju

Saradamba13 the High Court of Andhra Pradesh held at para

Nos.24 and 25 as follows :

"24. In Purna Chandra v. Kallipada Roy14 it was held that failure to stamp a document which has got to be stamped under the provision of the stamp Act does not affect the validity of the transaction embodied in the document it merely renders the document inadmissible in evidence.

AIR 1964 AP 519

AIR 1977 AP 348

AIR 1932 P.C. 34 ::37:: PNR,J & Dr.GRR,J crp_797_2022

25. So is the view taken in Joyman Bewa v. Easin

Sarkar that settlement deed or a conveyance deed or a gift deed passes title to immovable properties covered by the document, on its registration, the deficit of stamp duty paid on these documents only puts an embargo on the admissibility of the document and not on the transfer of the title to the property."

29. Therefore, from the above, it is clear that the defects of

"insufficiency of stamp duty" and "inadmissibility" of the

document in question is a curable defect which can be cured at the

stage of trial when they are sought to be tendered in evidence.

30. Further, the High Court of Andhra Pradesh in Vajrala

Ramesh and Vajrala Narayana Setty16, held at para Nos.30 and

31 as follows :

"30. From the above, it could be seen that the defect of the document, either unstamped or insufficiently stamped, can be cured either by the Court by impounding and levying the duty along with penalty on its own or if the party to the suit requires the document to be sent to an authorized officer under the Stamp Act, i.e., the Collector for levying the duty along with penalty to send the document to such officer. Therefore, this defect can otherwise be called as 'curable defect'. Consequently, the admission of such a defective document

I.C. Vol. XLII Page No.265

2005 (1) A.P.L.J. 312 (H.C.) ::38:: PNR,J & Dr.GRR,J crp_797_2022

under the Stamp Act depends much upon the steps taken by the Court or the person who tries to introduce the document in order to mark the same in the evidence.

31. To put it in a different way, a document, which suffers from the infirmity under the Stamp Act, does not remain as inadmissible document forever and the same is subject to further steps initiated by the Court or taken by the person who tries to introduce the said document in evidence."

31. Similarly, the Hon'ble Apex Court in Hindustan Steel Ltd.

Vs. Messrs Dilip Construction Company17 held at para no.7 as

follows :

"7. The Stamp Act is a fiscal measure enacted to secure revenue for the State on certain classes of instruments : It is not enacted to arm a litigant with a weapon of technicality to meet the case of his opponent. The stringent provisions of the Act are conceived in the interest of the revenue. Once that object is secured according to law, the party staking his claim on the instrument will not be defeated on the ground of the initial defect in the instrument. Viewed in that light the scheme is clear. Section 35 of the Stamp Act operates as a bar to an unstamped instrument being admitted in evidence or being acted upon ; Section 40 provides the procedure for instruments being impounded, sub-section (1) of Section 42 provides for certifying that an instrument is duly stamped, and sub-section (2) of Section 42 enacts the consequences resulting from such certification."

     1969 (1) SCC 597
                                 ::39::                 PNR,J & Dr.GRR,J
                                                           crp_797_2022

32. Therefore, from the above, it is evident that the stage of

tendering of evidence would arise only after pleadings are

complete including filing of written statement, issues are framed

and trial commences. In other words, once relief is granted and

consequently the written statement is filed and the trial commences

and in the said trial if such documents are tendered in evidence

such objection can be taken by the opposing party. Therefore, it

cannot be treated as a "defence" at this stage.

33. The argument of the learned Senior Counsel for the revision

petitioner that the suit pertains to only three out of six agreements,

and no dues under the other three contracts were sought to be

recovered in the suit, as such, the objections with respect to the

other three agreements had to be straightaway rejected, is valid.

34. His further argument that with regard to the invoices dated

26.09.2019 and 26.10.2019, they need no stamp duty as they were

contracts by themselves and the dues thereunder can be recovered

independent of such agreements is based upon the judgment of the ::40:: PNR,J & Dr.GRR,J crp_797_2022

Hon'ble Apex Court in Chatturbhuj Vithaldas Jasani vs.

Moreshwar Parashram18, wherein it was held as under :

"9. ... ... ...the letters merely set out the terms on which the parties were ready to do business with each other if and when orders were placed and executed. As soon as an order was placed and accepted a contract arose. It is true this contract would be governed by the terms set out in the letters but until an order was placed and accepted there was no contract. Also, each separate order and acceptance constituted a different and distinct contract : see Rose and Frank Co. vs. J.R. Crompton & Bros Ltd.19

35. Learned counsel for the revision petitioner relied on the

decision of the Hon'ble Apex Court in Dresser Rand S.A. vs.

Bindal Agro Chem Ltd. and another20, wherein it was held as

under :

"32. Parties agreeing upon the terms subject to which a contract will be governed, when made, is not the same as entering into the contract itself. Similarly, agreeing upon the terms which will govern a purchase when a purchase order is placed, is not the same as placing a purchase order. A prelude to a contract should not be confused with the contract itself. The purpose of Revision 4 dated 10.06.1991 was that if and when a purchase order was placed by BINDAL, that would be governed

AIR 1954 SC 236

1925 AC 445

(2006) 1 SCC 751 ::41:: PNR,J & Dr.GRR,J crp_797_2022

by the "General Conditions of Purchase" of BINDAL, as modified by Revision 4. But, when no purchase order was placed, neither the "General Conditions of Purchase" nor the arbitration clause in the "General Conditions of Purchase" became effective or enforceable. Therefore, initialling of "Revision 4" by DR and BINDAL on 10.06.1991 containing the modification to the General Conditions of Purchase, did not bring into existence any arbitration agreement to settle disputes between the parties."

36. Learned counsel for the revision petitioner further contended

that it was the purchaser who was required to pay the stamp duty

as per law and, therefore, it was the petitioner / 1st defendant who

purchased the stamp papers of the agreement dated 30.08.2017 and

having not paid the proper stamp duty, he could not be allowed to

take advantage of his own wrong; and relied on the decision of the

Hon'ble National Company Law Tribunal in Satra Properties

(India) Ltd vs. Vistra ITCL India Limited (formerly known as

IL & FS Trust Company Limited)21 wherein it was held as

under:

"13. ... ... ... I am of the opinion that the above plea of Stamp duty is not available to the Corporate Debtor in the present case when once the debt and default are proved

2022 SC Online NCLT 15 ::42:: PNR,J & Dr.GRR,J crp_797_2022

without looking into the above documents and accordingly the first issue is answered in negative. It is also pertinent to mention here that as per the terms and conditions of the NCD Subscription Agreement it is the Petitioner /Corporate Debtor that shall bear all documentation charges (including stamp duty) legal and valuation charges. Therefore, the petitioner shall not be permitted to take advantage of his own wrong. It is also important to mention here that it is the very case of the petitioner in para no.2 of the above M.A. that the above documents upon which the Financial Creditors are relying in the present proceedings have been novated and the respondent stood discharged of the liability thereunder in view of the larger understanding and overall settlement. Therefore, the petitioner having taken the above stand has no legal right to insist for impounding of the above document."

37. Learned counsel for the revision petitioner further contended

that as per the Agreement dated 30.08.2017, it was an agreement

for future sale and no sale had taken place under the said

agreement. As per the said agreement, vide Clause No.1 under the

heading Part-A equipment thereof, it was evident that the plaintiff

was required to supply 300 to 500 medical equipments in future,

i.e., in the ensuing period of five years. Further, even the said

supply was only upon the 1st defendant raising purchase order on

the plaintiff specifying the quantity and type, etc of the equipment ::43:: PNR,J & Dr.GRR,J crp_797_2022

and the location, address where it was required to be supplied.

Only upon such purchase order being raised, the plaintiff was

required to supply by way of sale. If no purchase order was raised

by the 1st defendant, the plaintiff was not bound to supply; and

consequently, there would be no sale and question of conveyance

of title in such movable properties would not arise. As per him,

the contract dated 30.08.2017 was properly stamped and valid and

falls under Article 12 or 5(j) of the Schedule - I of the Karnataka

Stamp Act, 1957. He further contended that the revision petitioner

was entitled to recover the said dues under the invoices themselves

without reference to the said Agreement dated 30.08.2017.

38. For the proposition that invoices were not required to be

stamped under the Indian Stamp Act, learned counsel for the

Revision Petitioner relied on the following precedents, viz., (1)

Reliance Industries Ltd. Vs. Imperial Pigments (P) Ltd22, (2)

M/s. KLG Systel Ltd. vs. M/s. Fujitsu ICIM Ltd.23, and B.L.

     2003 (68) DRJ 781

     I.L.R. (2001) I Delhi 436
                                          ::44::                  PNR,J & Dr.GRR,J
                                                                     crp_797_2022

Kashyap and Sons Ltd. Vs. JMS Steels and Power

Corporation24.

39. In Reliance Industries Ltd. (22 supra), the High Court of

Delhi held as follows :

"2. The first question to be addressed is whether the parties had entered into a 'written contract' on the breach of which this summary suit is founded. The plaintiff argues that all the terms of the parties engagement have been reduced to writing and can be found on the reverse side of each of its invoices. I had the occasion to consider this very contention in the case titled KLG Systems Ltd. v. Fujitsu ICIM Ltd.25. My conclusion was that "It is no longer res integra that invoices / bills are 'written contracts' within the contemplation of this Order. Reference is directed to Messrs. Punjab Pen House v. Samrat Bicycles Ltd.26; Corporate Voice (Pvt.) Ltd. v. Uniroll Leather India Ltd.27; and Beacon Electronics v. Sylvania and Laxman Ltd.28.

I may only add that if the transaction in question is covered by a single invoice or bill the party relying on it should be in a position to indubitably disclose that the adversary's attention was specifically drawn to the terms on the back of the bill, and that it consented to be bound to those terms by failing to lodge any demur. One must not lose sight of the reality that a person does not always read a bill or invoice from its start to its finish,

2022 S.C. Online SC 59

92 (2001) Delhi Law Times 88

AIR 1992 Delhi 1

60 (1995) DLT 321

1998 (3) Apex Decisions (Delhi) 141 : 1998 (45) DRJ 439 ::45:: PNR,J & Dr.GRR,J crp_797_2022

especially the reverse side. Where the bill is preceded by a delivery challan which does not contain all the terms of the transaction, this presumption may be an exception. However, where there have been a series of transactions in respect of which identical terms are printed on the bill, especially where both parties are commercial entities, this presumption would become irresistible. In the case at hand, several supplies have been made and each one is covered by identical and replicated terms. I am in no manner of doubt that a written contract can be found in these invoices such as would sufficiently attract the rigours of Order XXXVII of the C.P.C.'

40. In M/s. KLG Systel Ltd. (23 supra), the High Court of

Delhi held at para No.10 as follows :

"10. The Defendant / Applicant has also challenged the maintainability of the suit under Order XXXVII of the C.P.C., stating that "there is no debt or liquidated demand in money payable to defendant-Company (sic. read Plaintiff) and / or based on a written contract". It is no longer res integra that Invoices / Bills are "written contracts" within the contemplation of this Order. Reference is directed to Messrs.

Punjab Pen House vs. Samrat Bicycle Ltd.29, Corporate Voice (Pvt.) Ltd. vs. Uniroll Leather India Ltd.30 and Beacon Electronics vs. Sylvania and Laxman Ltd.31. There is, thus, no hesitancy in holding that the present suit is a suit which should

AIR 1992 Delhi 1

60 (1995) DLT 321

1998 (3) Apex Decisions (Delhi) 141 ::46:: PNR,J & Dr.GRR,J crp_797_2022

be tried under the summary procedure of Order XXXVII of the C.P.C."

41. In B.L. Kashyap and Sons Ltd. vs. JMS Steels and Power

Corporation32, the Hon'ble Apex Court has held at para no.33 as

follows :

"33. ... ... ... The plaintiff has further pointed out that two cheques were issued by the defendant No.1 towards part payment against the invoices, being cheque No.037274 dated 04.05.2015 in the sum of Rs.14,72,269/- and No.037272 dated 09.05.2015 in the sum of Rs.13,34,319/-"

42. Similarly, in Beacon Electronics v. Sylvania & Laxman

Ltd.33, the Delhi High Court by extracting the decision in

M/s. Punjab Pen House vs. M/s. Samrat Bicycle Ltd.34 has held

as under :

"... ... ...In M/s. Punjab Pen House (supra) at page 3 of the report which is relevant, it was held thus :-

"When the goods are supplied through a bill on certain terms and conditions duly agreed to between the parties, there is no escape from the conclusion that it amounts to a written contract between the parties. Therefore, I am of the view that the suit is covered by clause (2) sub-clause (b) of Order XXXVII

2022 SCC Online SC 59

1998 (45) DRJ

AIR 1992 Delhi 1 ::47:: PNR,J & Dr.GRR,J crp_797_2022

of the Code according to which the plaintiff seeks to recover a debt or liquidated amount in money payable by the defendant with or without interest arising on a written contract."

In para No.11 of the plaint it is pleaded that the bills referred to in para No.10 of the plaint amount to a written contract between the parties. Plaintiff has placed on file the original bills / invoices referred to in said para no.10 raised in the name of the defendant-company. These amongst others include the terms that interest @ 24% per annum will be charged if the bill is not paid within one month of the date of presentation; that no complaint regarding the bill and no reduction in rate(s) will be entertained if not made in writing within a week of the date of the bill and that the disputes between the parties are subject to Delhi jurisdiction. Thus, it cannot be said that it is a case simplicitor of supply of goods to the defendant without any written terms and conditions between the parties. Ratio in M/s. Punjab Pen House's case (supra), with which I fully agree applies to this case and the objection taken about the non-maintainability of the suit under the aforesaid Order CPC is replied being without merit."

43. The plaintiff specifically stated in the legal notice dated

13.07.2021 and also in the plaint that he was entitled to recover

under the invoices themselves and independently of the Agreement

dated 30.08.2017. No reply was given by the 1st defendant to the

said legal notice. Once the equipment was passed on to the 1st

defendant under the contract of sale of these invoices and the buyer ::48:: PNR,J & Dr.GRR,J crp_797_2022

neglects or refuses to pay the price, the seller (plaintiff) is entitled

to recover the same under the provisions of Sale of Goods Act,

1930. The said Agreement dated 30.08.2017 had been acted by

both the parties without demur and part payments were made. The

amounts due had been acknowledged by the 1st defendant several

times. As stated in Annexure-II to the counter-affidavit, vide e-

mails dated 14.03.2019, 21.03.2019, 23.09.2019, 04.04.2020,

03.03.2021, 10.03.2021 and 02.04.2021, the accounts between the

parties have been reconciled several times and in each such

reconciliation, specific figure of debt was acknowledged as due by

the 1st defendant to the plaintiff, and latest such reconciliation was

dated 25.05.2021; and the same would constitute

acknowledgments of debts under law. The 1st defendant made part

payment of Rs.2,18,50,141/- on 13.03.2021 as evidenced from

page No.543 of Compilation No.2. The acknowledgment of debts

by themselves would constitute a contract and basing on such

acknowledgment of debts, suits are maintainable under Order

XXXVII of CPC.

                                       ::49::                    PNR,J & Dr.GRR,J
                                                                    crp_797_2022

44. Learned counsel for the revision petitioner further relied on

the decisions of the Hon'ble Apex Court in V.K. Enterprises vs.

Shiva Steels35 and Daya Chand Uttam Prakash Jain vs. Santosh

Devi Sharma36.

In V.K. Enterprises, (35 supra), the Hon'ble Apex Court

held at para Nos.10 to 13 as under :

"10. Order 37 CPC has been included in the Code of Civil Procedure in order to allow a person, who has a clear and undisputed claim in respect of any monetary dues, to recover the dues quickly by a summary procedure instead of taking the long route of a regular suit. The courts have consistently held that if the affidavit filed by the defendant discloses a triable issue that is at least plausible, leave should be granted, but when the defence raised appears to be moonshine and sham, unconditional leave to defend cannot be granted.

11. What is required to be examined for grant of leave is whether the defence taken in the application under Order 37 Rule 3 CPC makes out a case, which if established, would be a plausible defence in a regular suit. In matters relating to dishonour of cheques, the aforesaid principle becomes more relevant as the cheques are issued normally for liquidation of dues which are admitted. In the instant case, the defence would have been plausible had it not been for the fact that the

(2010) 9 SCC 256

1997 SCC Online Del 238 ::50:: PNR,J & Dr.GRR,J crp_797_2022

allegations relating to the interpolation of the cheque is without substance and the ledger accounts relating to the dues, clearly demonstrated that such dues had been settled between the parties. Moreover, the issuance of the cheque had never been disputed on behalf of the petitioner whose case was that the same had been given on account of security and not for presentation, but an attempt had been made to misuse the same by dishonest means.

12. Against such cogent evidence produced by the respondent-plaintiff, there is only an oral denial which is not supported by any corroborative evidence from the side of the petitioner. On the other hand, the ledger book maintained by the respondent and settled by the petitioner had been produced on behalf of the respondent in order to prove the transactions in respect of which the cheque in question had been issued by the petitioner.

13. In our view, the defence raised by the petitioner does not make out any triable issue and the High Court has dealt with the matter correctly and has justifiably rejected the petitioner's application under Order 37 Rule 3 CPC and the same does not call for interference by this Court."

45. Likewise, in Daya Chand Uttam Prakash Jain (36 supra),

the Delhi High Court held at para No.15 as follows :

"15. It is further notable that before filing this suit a legal notice was given. The payments upto 29th July, 1989 have not been disputed. Simply it has been stated that they are matters of record. Moreover, there is virtual admission of the liability, ::51:: PNR,J & Dr.GRR,J crp_797_2022

it is sought to be adjusted by alleging an oral agreement of standing surety for cloth sold to the husband of the plaintiff and payment of Rs.35,000/- to M/s. Paras Nath Textiles without alleging date and mode of payment either in para 5(e) in which payment is alleged or in any other paras of the application for leave to defend. It is disputed by the other side on affidavit and certain contradictions have also been pointed out in the stand in this case and the plea in suit filed subsequently and numbered as 169/90. Besides, the affidavit filed in support of the application has been verified by maintaining that "the contents of the above affidavit are true and correct to my knowledge". This kind of omnibus statement of verification appeared to be palpably wrong for apart from legal plea, there is information relating to other firm, which cannot be passed on personal knowledge, source of information about encashment or non-encashment Cheque No.196311 drawn on Karnataka Bank, Chandni Chowk. In ordinary course such type of affidavit should not be relied upon under Order 19 Rule 3 C.P.C. unless it is stated that such cheque was received by the other firm in the presence of the deponent and it was presented to the bank in his presence and was subsequently dishonoured and he had seen the letter of the bank conveying the information about the cheque having been dishonoured. Even where allegations in an affidavit are stated to be correct to the best of the knowledge, the nature and source of knowledge must be disclosed. If the nature and source of the knowledge is not disclosed the affidavit would not be as per law (see Sukhwinder Pal Bipan Kumar vs. State of Punjab37. In such circumstances it appears that the defence taken by the

(1982) 1 SCC 31 ::52:: PNR,J & Dr.GRR,J crp_797_2022

petitioner is as good as illusory a sham and practically a moonshine and therefore, unconditional leave could not be granted. This case is covered by the principles laid down for 5th category of cases in Mechalec Engineer & Manufacturers v. Basic Equipment Corporation."

46. Apart from the above submissions, learned counsel for the

revision petitioner also submitted that the plaintiff was ready to

adopt the procedure spelt out by the High Court of Bombay dated

26.05.2020 rendered in I.L. & F.S. Financial Services Limited

vs. Anupama Agarwal and others38, which is as follows :

""88. In a summary suit, while deciding a summons for judgment, the opinions which the Court exercises, equip the court to ensure that the requisite stamp-duty is recovered, wherever the instrument is either unstamped or insufficiently stamped. If the Court grants an unconditional leave to defend, the Court can very well direct that the instrument be impounded and the procedure prescribed under Section 37 of the Act be resorted to. Even when the Court grants conditional leave, the Court can issue such directions. In a case, where the Court comes to the conclusion that the defendant is not entitled to leave to defend the suit and, conversely, the plaintiff is entitled to a

Summons for Judgment No.21 of 2019 in Commercial Summary Suit No.396 of 2019, dated 26.05.2020, High Court of Bombay ::53:: PNR,J & Dr.GRR,J crp_797_2022

judgment, still, the Court would be within its right in impounding the instrument and directing the adjudication and payment of the requisite stamp- duty with penalty, if any. The compliance can be ensured by a direction that the decree shall not be drawn and executed till the deficit stamp-duty is adjudicated and paid. In none of the aforesaid contingencies, where the Court impounds the instrument, it can be said that the Court has acted upon the instrument without ensuring the compliance of the statutory requirement of payment of stamp-duty.

89. In contrast, if the consideration of the summons for judgment and the question of grant of leave to defend a summary suit is deferred till the question of stamp-duty is finally adjudicated by the authorities under the Act, the object with which the summary procedure is envisaged may not be advanced.""

28. I am of the considered view that in the case of I.L.F.S. (supra) this Court has considered all the submissions including the one now sought to be canvassed. The reasons for adopting the course of impounding the instrument and granting conditional leave to defend the suit including the necessity of harmonizing the provisions contained in Order 37 of the Code and Section 34 of the Stamp Act, 1958 have been spelt out. I am not impelled to accede to the submission that the points urged by Mr. Joshi in this case warrant re- consideration of the aforesaid view. Thus, the course adopted ::54:: PNR,J & Dr.GRR,J crp_797_2022

by this Court in the case of I.L.F.S. (supra) can be legitimately adopted in this case as well."

We completely agree with the course suggested in the above

judgment.

47. With regard to Defence No.3, learned counsel for the

revision plaintiff submitted that the essential part of the cause of

action had arisen at Shamshabad, Hyderabad. Therefore, the

Commercial Court at Ranga Reddy District has territorial

jurisdiction to try the above suit. If the jurisdiction falls in more

than one Court then it is open for the parties to confer jurisdiction

on any of them to the exclusion of the other. But, in the facts of

the present case, both parties, having international presence in the

field of commercial activities open-eyedly borne out of meetings

of their minds, fully comprehended the situation and ground

realities, have agreed vide Clause No.5 read with Clause (9) of the

Agreement dated 30.08.2017, that the Courts within whose

jurisdiction Shamshabad, Hyderabad falls shall have jurisdiction to

the exclusion of other Courts. The 1st defendant released the

purchase orders on the plaintiff at its corporate office at ::55:: PNR,J & Dr.GRR,J crp_797_2022

Shamshabad. Accepting the said purchase orders at Shamshabad,

the plaintiff had supplied the goods. Therefore, the contracts of

sale (invoices) have got concluded at Shamshabad. Hence, part of

the cause of action had arisen at Shamshabad. Even if negligible

part of cause of action had arisen at Shamshabad, Hyderabad still it

constitutes part of cause of action under Section 20(c) of CPC.

48. In support of the above contentions, learned counsel for the

revision petitioner / plaintiff relied on the following decisions as

under :

In M/s. KLG Systel Ltd. (23 supra), a learned Single Judge

of the Delhi High Court held at para No.9 as follows :

"9. Section 20 of the C.P.C. recognizes the territorial jurisdiction of Courts, inter alia, wherever the cause of action wholly or in part arises. The Defendant / Applicant has admitted that it has a Branch office at 5A Bahadur Shah Zafar Marg, New Delhi and 5 Sansad Marg, New Delhi, and therefore, the present case is not of the genre where the Defendant has been put to a disadvantage because of the Plaintiff's choice of filing the suit in New Delhi. Even if the convenience consideration is set apart, I am satisfied that the cause of action had arisen in Delhi. The Plaintiff has asserted in the Plaint that the order was accepted in Delhi, and this fact ::56:: PNR,J & Dr.GRR,J crp_797_2022

has not even been denied or even traversed by the Defendant / Applicant. It is immaterial whether dealings between the parties were through the Defendant's Madras office, or that delivery of the software was to be effected in Cochin. It is trite to state that the cause of action arises at different times, and at different places, and any of these would be a legitimate venue for suing. No triable issue therefore arises on this account."

49. Likewise, the Punjab and Haryana High Court in Union of

India vs. Shibboo Mal and Sons39, held at para Nos.13 and 14 as

follows :

"13. Clause (c) of Section 20 of the Code deals with 'cause of action'. In the suit based on a contract the cause of action will consist of the making of the contract and of its breach at the place where it is to be performed. An action, therefore, for breach of a contract at the option of the plaintiff can be brought either at the place where the contract was made or the place where the breach was committed. In deciding the question as to where the contract is made, the Court must take into consideration the provision of Section 4 of the Contract Act. A contract is made when an offer of one party is accepted by the other party. In the present case, as specifically alleged by respondent No.1 the acceptance of the agreement was conveyed to him at Chandigarh. Thus, part of the cause of action arose at Chandigarh and the Civil Court at Chandigarh had the jurisdiction to entertain the petition. In Bhagwandas

AIR 1989 P & H 205 ::57:: PNR,J & Dr.GRR,J crp_797_2022

Goverdhandas Kedia vs. Girdharilal Parshotam Dass40, the Apex Court observed as under :-

"Making of an offer at a place which has been accepted else where does not form part of the cause of action in a suit for damages for breach of contract. Ordinarily it is the acceptance of offer and intimation of that acceptance which result in a contract. By intimating an offer, when the parties are not in the presence of each other, the offeror is deemed to be making the offer continuously till the offer reaches the offeree. The offeror thereby merely intimates his intention to enter into a contract on the terms of the offer. Offeror cannot impose upon the offeree an obligation to accept, nor proclaim that silence of the offeree shall be deemed consent. A contract being the result of an offer made by one party an acceptance of that very offer by the other, acceptance of offer and intimation of acceptance by some external manifestation which the law regards as sufficient is necessary."

14. Reference may usefully be made to State of Maharashtra vs. Ranjeet Construction41, where the learned Chief Justice held as under :-

"That the tender was accepted by the Government and communicated to the applicant at his Pune address where he carries on business is admitted. Though the contract itself was formally executed at Kohlapur, that was in pursuance of the acceptance of the tender communicated

AIR 1966 SC 543

AIR 1986 Bom. 76 ::58:: PNR,J & Dr.GRR,J crp_797_2022

to the applicant at Pune. The contract itself does not specify any Court in particular as having jurisdiction in respect of any dispute arising under the contract. In the absence of any such specific stipulation in the agreement, the Court within the jurisdiction of which part of cause of action arises, has jurisdiction to entertain the petition Cause of faction comprises of a bundle of facts and all these facts may not necessarily occur within the jurisdiction of the same Court. Part of the cause of action may arise within the jurisdiction of one Court and part within the jurisdiction of another Court. Section 20 of the C.P.C. lays down that subject to the limitations in Ss. 15, 16, 17, 18 and 19 of C.P.C. every suit shall be instituted in a Court within the local limits of whose jurisdiction the defendant, or each of the defendants where there are more than one, at the time of commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain or the cause of action, wholly or in part arises. When the acceptance of the tender was communicated by the opponent Government to the applicant at Pune, it must be held that the part of cause of action arose at Pune and, therefore, he could have filed a suit at Pune."

50. Similarly, in State of Maharashtra vs. Ranjeet

Construction42, the Court held as follows :

AIR 1986 Bom. 76 ::59:: PNR,J & Dr.GRR,J crp_797_2022

"2. That the tender was accepted by the Government and communicated to the Applicant at his Pune address where he carries on business is admitted. Though the contract itself was formally executed at Kolhapur, that was in pursuance of the acceptance of the tender communicated to the Applicant at Pune. The contract itself does not specify any Court in particular as having jurisdiction in respect of anydispute arising under that contract . In the absence of any such specific stipulation in the agreement, the Court within the jurisdiction of which part of the cause of action arises, has jurisdiction to entertain the petition. Cause of action comprises of a bundle of facts and all these facts may not necessarily occur within the jurisdiction of the same Court. Part of the cause of action may arise within the jurisdiction of one Court and part within the jurisdiction of another Court. Section 20 of the C.P.C. lays down that subject to the limitations in Ss. 15, 16, 17, 18 and 19 of C.P.C., every suit shall be instituted in a Court within the local limits of whose jurisdiction the defendent, or each of the defendents where there are more than one, at the time of the commencement of the suit, actually and voluntarily reside, or carries on business, or personally works for gain or the cause of action, wholly or in part, arises. When the acceptance of the tender was communicated by the Opponent-Government to the applicant at Pune, it must be held that the part of cause of action arose at Pune and, therefore, he could have filed a suit at Pune. So also the Opponent which is Government can be said to be carrying on its business throughout the State, therefore, the Court at Pune had jurisdiction to entertain the petition. The objection of the Opponents-Petitioners herin, that the petition should have been filed in a Court at Kolhapur, because the ::60:: PNR,J & Dr.GRR,J crp_797_2022

contract was accepted in Kolhapur, is untenable. The application was one for apointment of an Arbitrator; it was not a suit for a declaration of recovery of any immovable property which under S. 17 has to be filed within the territorial jurisdiction of the Court where the property is situate. No doubt the Kolhapur Court would also have jurisdiction and if the petition were filed in Kolhapur Court, no valid objection could have been taken to the jurisdiction of the Court to entertain the Petition. The question is : Has the Pune Court territorial jurisdiction to entertain the Petition? Where several Courts have jurisdiction, it is left to the applicant or plaintiff to file the petition or to institute the suit in whichever of those Courts he liked. Quite apart from the above, this technical objection comes with ill-grace from the State. It makes no difference so far as the State is concerned whether such a petition is filed in the Court of the Civil Judge, Senior Division at Pune or at Kolhapur. The matter relates to a contract of 1979. The Government which had submitted to the arbitration of its own Superintending Engineer, ought not to have taken such an objection. Whatever right it may have on merits in the arbitration proceedings, if arbitration proceedings are maintainable. Whether another Arbitrator is appointed by the Civil Judge, Senior Division at Pune or Civil Judge, Senior Division at Kolhapur does not affect them in the least. The Government could very well have opposed the application on merits and not on such a technical objection. I do not see any reason to set aside the order of the Civil Judge, Senior Division, Pune, and accordingly this Civil Revision Application will have to be rejected."

                                        ::61::                        PNR,J & Dr.GRR,J
                                                                         crp_797_2022




51.       Likewise,       in    D.     Munirangappa            vs.     Amidayala

Venkatappa43, a learned Single Judge of the Mysore High Court

held as follows :

"6. Thus, it is clear that every suit has to be instituted in a Court within the local limits of whose jurisdiction the cause of action wholly or in part arises. It would not be right as has been done by the Court below to proceed to examine the extent of the cause of action or to try to find out the percentage of the cause of action. If a part of the cause of action arises within the local limits of the jurisdiction of a Court, then such a Court would have jurisdiction to entertain and try such a suit, irrespective of the extent of the cause of action. It is in my opinion wholly wrong to state that a very small fraction of the cause of action accrued within the jurisdiction of the Tumkur Court, which would not entitle the plaintiff to institute a suit in that Court. This process of examining the cause of action would be wholly wrong in view of Section 20, Clause (c), which provides that every suit shall be instituted in a Court within the local limits of whose jurisdiction the cause of action, wholly or in part, arises. The words 'in part' have not been defined. Even a fraction of a cause of action is a part of the cause of action and therefore, if a part of the cause of action accrues within the local limits of the jurisdiction of Tumkur Court then it must be held that that Court has the jurisdiction to entertain the suit. The provisions of clause (s) of Section 20 of the Code of Civil Procedure are based on broad principle to avoid the multiplicity of the proceedings and inconvenience to the

AIR 1965 Mys 316 ::62:: PNR,J & Dr.GRR,J crp_797_2022

parties. If the reasoning adopted by the Courts below is accepted as correct, it would lead to many inconvenient results which the legislature sought to avoid by enacting the provisions of clause (c) of Section 20 of the Code of Civil Procedure. For these reasons I hold that the Courts below were wrong in taking the view they took and thus declining to exercise the jurisdiction vested in them by law."

52. Further, in M/s. Sponge Iron India Ltd. vs. M/s. Andhra

Steel Corporation Ltd.44, a learned Single Judge of the Andhra

Pradesh High Court has held as under :

"6. It is seen from the above provision that a suit can be filed in a Court in whose jurisdiction the defendant resides or carries on business and a suit can also be filed in a Court in whose jurisdiction the cause of action as a whole or in part arises. The Section gives a right to the plaintiff to choose the forum and file a suit in whose jurisdiction the defendant resides or where the whole cause of action or a part of cause of action arises. Therefore, the plaintiff in this case has a right to file a suit in Kothagudem Court as part or cause of action arose as S.I.I.L. campus which is within the territorial jurisdiction of Kothagudem Court or the plaintiff may also file a suit at Bangalore where the defendant was carrying on business. The plaintiff has a choice in the matter."

     1988 (2) APLJ 493 (HC)
                               ::63::                 PNR,J & Dr.GRR,J
                                                         crp_797_2022

Considering the above judgments, the Defence No.3 taken by the

1st defendant has no legal basis, and is accordingly liable to be

rejected.

53. The above set of defences were no defences at all and they

were not even plausible to grant relief to defend the suit. The

defences taken by the 1st defendant were not bona fide and not in

good faith as he admitted supply of goods pursuant to the said

agreement dated 30.08.2017 and put them to use and made

payments. The 1st defendant also admitted the amounts due to the

plaintiff by numerous acknowledgment of debts, then turned

around to dispute the said agreements that too on the ground of

purported 'insufficiency of stamp duty'. The 1st defendant

received legal notice dated 13.07.2021 but did not bother to reply

to the same. The 1st defendant attempted to pre-empt the plaintiff

from availing legal remedies for recovery of money by filing

Commercial O.S.No.754 of 2021 at Bangalore. But, the said suit

was dismissed by allowing the petition filed by the plaintiff under

Order VII Rule 11 of C.P.C.

                                ::64::                 PNR,J & Dr.GRR,J
                                                          crp_797_2022

54. Further, the agreement in question dated 10.03.2017

between the 1st defendant and the 2nd defendant would disclose that

the ownership and title to the equipment vested with the 1st

defendant though it was lying with the 2nd defendant. But, still, the

1st defendant made a statement in para no.4 of the written

statement to the effect that the said equipment was owned by the

2nd defendant. The conduct of 1st defendant in denying the said

facts which were admitted by him earlier and thereafter filing

numerous, frivolous I.A.s and pleadings would show that, only to

delay the recovery of the dues and in passing of the judgment and

decree against him, he resorted to such conduct. Hence, the leave

to defend the suit should not have been granted by the Trial Court.

The Trial Court had not even directed the 1st defendant to deposit

the admitted amount. Unless the admitted amount with interest at

contracted rate is deposited, the Trial Court ought not to have

granted leave to defend the suit to the 1st defendant. Moreover,

Order XXXVII Rule 3 provides for interest at the contracted rate.

Hence, it is considered fit to allow the Civil Revision Petition by

setting aside the order dated 11.03.2022 passed in Interlocutory ::65:: PNR,J & Dr.GRR,J crp_797_2022

Application No.22 of 2022 in C.O.S.No.60 of 2021 on the file of

the Special Judge for Trial and Disposal of Commercial Disputes,

Ranga Reddy District, at L.B.Nagar granting leave to defend the

suit to the 1st defendant.

55. The 1st defendant is directed to deposit the entire amount

including interest claimed in the suit as a condition precedent to

defend the suit as prescribed under Rule 3(5) of Order XXXVII of

C.P.C.

56. Accordingly, the Civil Revision Petition is allowed setting

aside order dated 11.03.2022 passed in Interlocutory Application

No.22 of 2022 in C.O.S.No.60 of 2021 on the file of the Special

Judge for Trial and Disposal of Commercial Disputes, Ranga

Reddy District, at L.B.Nagar. No costs.

57. As a sequel, miscellaneous petitions pending if any in this

Civil Revision Petition, shall stand closed.

___________________________ P.NAVEEN RAO, J

__________________________ Dr. G.RADHA RANI, J Date : 26.08.2022 Ndr