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Lachhman Singh Etc. Vs. C.D. Taneja Etc. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtDelhi High Court
Decided On
Case NumberCivil Revision Appeal No. 20 of 1973
Judge
Reported in1974RLR80
ActsCode of Civil Procedure (CPC), 1908 - Order 37
AppellantLachhman Singh Etc.
RespondentC.D. Taneja Etc.
Advocates: Jetha Nand and; O.P. Malviya, Advs
Cases ReferredSantosh Kumar v. Bhai Mool Singh.
Excerpt:
.....the facts alleged by the defendant are duly proved' they will afford a good, or even a plausible, answer to the plaintiff's claim. once the court is satisfied about that, leave cannot be withheld and no question about imposing conditions can arise ;and once leave is granted, the normal procedure of a suit, so far as evidence and proof go, obtains. ' in another part of the judment the court disapproved the observation of the trial judge that although the defense raised by the defendant did raise a triable issue, it was not enough for the defendants to back up their assertions with an affidavit ;they should also have produced writings and documents which they said were in their possession and which they asserted would prove that the cheques and payments referred to in their defense were..........the subordinate judge dt. 11-9-72 by which he has granted leave to the petitioners to defend the suit in respect of a part of the amount claimed in the suit while it has refused leave in respect of another part. the suit was instituted by narain dass babar, plaintiff who is respondent no. 2 herein it was instituted against the petitioners and one bhagwant singh who was defendant no. 2 and who has since been given up by the plaintiff. mr. c.d. taneja first respondent in the revision (the original holder of the promissory notes) was defendant no. 4 in the suit. the plaintiff instituted the suit on the allegations that defendant 1, 2 and 3 executed two pronotes in favor of defendant no. 4; one being dated 15th november, 1968 for a sum of rs. 1,800.00 and the other dated 22nd november,.....
Judgment:

B.C. Misra, J.

(1) This revision petition has been filed u/s 115, C.P C. against the order of the Subordinate Judge dt. 11-9-72 by which he has granted leave to the petitioners to defend the suit in respect of a part of the amount claimed in the suit while it has refused leave in respect of another part. The suit was instituted by Narain Dass Babar, plaintiff who is respondent No. 2 herein It was instituted against the petitioners and one Bhagwant Singh who was defendant No. 2 and who has since been given up by the plaintiff. Mr. C.D. Taneja first respondent in the revision (the original holder of the promissory notes) was defendant No. 4 in the suit. The plaintiff instituted the suit on the allegations that defendant 1, 2 and 3 executed two pronotes in favor of defendant No. 4; one being dated 15th November, 1968 for a sum of Rs. 1,800.00 and the other dated 22nd November, 1968 for a sum of 2,500.00. It was alleged that the defendants had paid Rs. 950.00 towards debts which had been adjusted by defendant No. 4 towards the first pronote of Rs. 1,800.00 (being Rs. 811.00 on account of principal and Rs. 139.00 on account of interest) and that the balance was claimed in respect of the said pronote. It was also alleged that nothing had been paid on account of the second pronote and so a sum of Rs. 2,500.00 as principal and Rs. 431.25 as interest was due on the second pronote of Rs. 2,500.00; besides Rs. 989.00 as principal and Rs. 97.40 on account of interest was due under the first pronote making a total ofRs. 4,017.65 out of which the plaintiff after giving up Rs. 17.65 filed the suit for recovery of Rs. 4,00.00 besides the future interest and costs. The suit was instituted under the summary procedure prescribed by Order 37 of the Code of Civil Procedure. On service of the summonses the petitioners filed two separate applications being one on behalf of defendant No. 1 and the other on behalf of defendant No. 3 for leave to defend the suit. They raised various defenses in the applications. The applications were contested on behalf of the plaintiff.

(2) The same were disposed of by the lower court by the impugned order. The learned lower court found that some of the defenses raised on behalf of the petitioners were sham, bogus and imaginary. It, however, found substance in the pleas of payment raised by the petitioners. It was of the view that in addition to the amount of Rs. 950.00 admitted by the plaintiff to have been paid by defendants another sum of Rs. 550.00 had been paid by defendant No. 1 to the fourth defendant the assignor on by cheque. The learned lower court was, however, not satisfied with regard to the allegations of the defendants about the payment of other sums of Rs. 625.00 by cheques and Rs. 1,000.00 by cash and cheques In this way against the plea of payments of Rs. 1,625.00 the court was satisfied about the payment of Rs. 550.00 but not with regard to the rest. It, thereforee, decreed the suit to the extent of Rs. 2,375.00 thereby presumably refusing leave to that extent. It, however, granted leave to defendants 1, 3 and 4 to file their written statements in respect of the balance amount. Aggrieved by this order the petitioners have filed this revision petition.

(3) Mr. Malviya, learned counsel for the plaintiff has raised a preliminary objection to the maintainability of the revision. He contends that the court below has passed a decree for Rs. 2,375.00 and since no appeal has been filed against it the same has become final and the revision is not maintainable to have the same set aside. He has cited, Mohd. Yunus and another V, Sugra Begum and an others Air 1955 Hyd 156. In that case a Division Bench of the High Court of Hyderabad held that an order passed under Rule 11 of Order 7 rejecting the plaint was a decree and was appealable and if necessary could be reviewed and that being a specific provision for getting rid of the order it was not open to the court to exercise its inherent power under section 151 of the Civil Procedure Code . to set aside the order and thereby deprive the opposite party of the valuable right acquired by the bar of limitation. The said authority has no relevance to the facts of the present case. There is no doubt that an order refusing leave to defend the suit is subject to revision in the High Court if it satisfies the other conditions of attracting the provision of law. The impugned order has granted leave to the petitioners only to the extent of part of claim in the suit and this order is revisable at the instance of the petitioners who contend that the leave should have been granted by the court below in respect of the whole of the claim in the suit. The mere fact that the court below at the time of or after refusing leave has passed a decree for part of the amount does not have the effect of depriving the petitioners of their right to have the impugned order revised by this court in exercise of its revisional jurisdiction. There is no force in the preliminary objection and the same is rejected.

(4) So far as the merits are concerned I am of the opinion that the impugned order is not sustainable. The defense set up by the petitioners was that no amount was due under the first pronote of Rs. 1,800.00 which had been executed without consideration and that they had paid Rs. 1,625.00 on account of the amount claimed by the plaintiff under the pronote executed for Rs. 2,500.00. The payment of Rs. 950.00 was admitted and the court below found that another payment of Rs. 550.00 appears to have been made which had not been adjusted. With regard to the payment of Rs. 1,075.00 alleged by the defendants, the court has repelled the allegation of the defendants with the observations that no details of the cheque numbers or the dates on which these payments had been made were given and it had not been disclosed as to which part of Rs. 1,000.00 was paid in cash and which part by cheques. It was also stated that defendant No. 1was still obtaining information from the Punjab National Bank of the cheques but such a statement of account was not filed till the date of the order. The court found that the defendants had reasonable defense with respect to an amount of Rs. 550.00 but not with regard to the balance of the amount.

(5) There is a fallacy in the reasoning and conclusion of the court below. The defendants had raised a defense to the suit as a whole and the court under the law had to determine whether the defense was bona fide and raised a triable issue to merit leave to defend. The conclusion of the court must relate to the defense to the whole suit. The court was certainly entitled to consider the various defense pleas raised in order to determine whether the defense was bonafide or not but it was not open to it to return to a finding that there was a bonafide defense with regard to the part of the claim in the suit and not with regard to the remaining part. It is obvious that the court was not trying the whole suit and granting a decree in this behalf. The question raised before the court was the application of the defendant to give leave to appear and to defend the suit. The provisions of Order 37 rule 3 speak of defense to the suit and not to defense to a part of the suit. The jurisdiction of the court consisted in refusing leave or granting it un-conditionally or subject to such terms as to giving of security etc. as it thought fit. After taking all the facts and circumstances of the case and plausibility of all the pleas raised, the court ought to have determined whether the defense raised to the whole suit was or was not bonafide and having arrived at such a conclusion, it ought to have acted according to law in refusing leave or granting leave unconditionally or conditionally. The lower court has, however, granted leave in respect of the part of the defense of the suit and has refused it in respect of the other part. Thereby it has split up the defense as well as the suit. This course in my opinion is in excess of the jurisdiction of the court below and the impugned order is, thereforee, not sustainable.

(6) The principles on which the leave is or is not to be granted have been authoritatively laid down by Supreme Court in Santosh Kumar v. Bhai Mool Singh. : [1958]1SCR1211 . In this authority the court observed that 'the learned Judge has failed to see that the stage of proof can only come after the defendant has been allowed to enter an appearance and defend the suit, and that the nature of the defense has to be determined at the time when the affidavit is put in At that stage all that the Court has to determine is whether 'if the facts alleged by the defendant are duly proved' they will afford a good, or even a plausible, answer to the plaintiff's claim. Once the Court is satisfied about that, leave cannot be withheld and no question about imposing conditions can arise ; and once leave is granted, the normal procedure of a suit, so far as evidence and proof go, obtains.' In another part of the judment the Court disapproved the observation of the trial Judge that although the defense raised by the defendant did raise a triable issue, it was not enough for the defendants to back up their assertions with an affidavit ; they should also have produced writings and documents which they said were in their possession and which they asserted would prove that the cheques and payments referred to in their defense were given in payment of the cheque in suit. This authority has been followed by a reported judgment of this court in Jetha Singh v Chaman Lal, : AIR1968Delhi122 .

(7) In the present case the court below had found that the defense of the petitioners was bona fide and plausible and triable to the extent that a sum of Rs. 550.00 had been paid by them over and above the amount admitted by the plaintiff for which the plaintiff had not given any credit. This certainly established a bonafide defense to the suit. With regard to the allegation about the payment of a further amount of Rs. 1,075.00 the defendants had still to prove and establish the case by evidence on record, and it was premature for the court below to hold that the said payment had not been established. As observed by the Supreme Court in Santosh Kumar's case the bonafides of the plea had to be determined prima facie on affidavits and an opportunity had to be given to the defendants to establish the same by producing evidence after having been granted leave to defend the suit. In my opinion the court below was not justified in prematurely holding that the defendants had not established the payment of the disputed amount of Rs. 1,075.00 and refusing leave in respect of the defense to a part of the claim in suit. In view of the fact that the defendants had satisfied the court with regard to the fact that some amount in addition to what had been admitted by the plaintiff had been paid, the court was bound to grant leave to defend the suit as a whole.


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