Madras High Court
Mrs. K. Vasantha Devi vs Mahesh Kumar Rathi [Alongwith ... on 26 March, 2004
Equivalent citations: 2004(3)CTC321
Author: P. Sathasivam
Bench: P. Sathasivam
ORDER
1. Aggrieved by the common order passed by XI Assistant Judge, City Civil Court, Chennai dated 15-04-2002 made in I.A.Nos. 14060 and 14059 of 2001 in O.S.No. 176 of 2000, defendants 1 and 2 therein preferred the above Revision Petitions.
2. The plaintiff/respondent herein filed the said suit (O.S.No.176 of 2000) under Order 37 of the Code of Civil Procedure, praying for judgement and decree in favour of him for a sum of Rs.55,900/- with interest on Rs.30,000/- at 30 per cent per annum from the date of plaint till the date of realisation. The petitioners herein/defendants before the Court below filed I.A.Nos. 14060 and 14059/2001 under Order 37, Rule 3 (5) C.P.C., praying for unconditional leave to them to defend the said suit.
3. In the affidavit the first defendant has stated that the procedures contemplated under Order 37 C.P.C. have not been followed. He was not served with a copy of the plaint and the annexures thereto along with the summons which is mandatory under Order 37, Rule 3 of C.P.C. However, he entered appearance through his counsel in time i.e., on 6-6-2001. A notice dated 6-6-2001 of appearance with address for service was served by his counsel to the counsel for plaintiff. His wife/2nd defendant never borrowed any amount nor promised to pay any amount to the plaintiff. He alone paid interest by cheques, the last of which was by cheque No. 756743 dated 6-1-96 on State Bank of India for Rs.1,500/- covering the period upto June, 1995 in all amounting to Rs.34,500/- exceeding the principal amount. On 12-11-96 he sent a cheque for Rs.10,750/- in full and final settlement of suit promissory note. The last date of payment of cheque is dated 12-11-96, hence the suit filed on 26-11-99 is barred by limitation.
4. Similar petition was filed by the second defendant wherein it is stated that she was not furnished with all the required particulars as provided under Order 37. She never borrowed any amount nor promised to pay any amount to the plaintiff. She is not a necessary party to the suit.
5. The respondent therein/plaintiff filed a counter affidavit denying the averments made by the defendants.
6. No oral evidence was let in on either side. However, Exs. P-1 to P-6 were marked on the side of the petitioners and Exs. R-1 and R-2 on the side of the respondent. The learned trial Judge by the impugned order after holding that no triable issues, dismissed their petitions; hence the above Revisions.
7. Heard learned counsel for the petitioners as well as learned counsel for the respondent.
8. The point for consideration in these Revisions is, whether the petitioners/defendants have established triable issues to contest the suit and whether the learned trial Judge is right in dismissing their petitions.
9. First I will deal with the claim of the petitioner in C.R.P.No.2166/2002/second defendant in the suit. The respondent/plaintiff filed the said suit under Order 37 C.P.C., based on a promissory note dated 31-8-91. It is the specific case of the second defendant that she has nothing to do with the promissory note on the alleged amount received. Though the plaint averment proceeds that both the defendants, namely M. Kothandaraman and his wife K. Vasantha Devi executed a promissory note on 31-8-91 for Rs.30,000/- with a promise to repay the sum jointly and severally with interest at the rate of 30 per cent per annum, a perusal of the copy of the pronote shows that the body of the pronote does not contain the name of the second defendant-K. Vasantha Devi. It refers to only M. Kothandaraman, first defendant. It is true that at the bottom of the pronote on the left hand side, the second defendant had signed on the revenue stamp. In such a circumstance, whether she also joined in the execution of the promissory note and promised to repay the same is the question to be decided by the Court below after trial i.e., examination of witnesses and marking of documents.
10. Now coming to the claim of the first defendant, it is specifically stated in the affidavit filed in support of the application to leave to defend the suit that he paid interest by cheques, the last of which was by cheque No. 756743 dated 06-01-96 on State Bank of India for Rs.1,500/- covering the period upto June, 1995 in all amounting to Rs.34,500/- exceeding the principal amount. It is also his case that there were negotiations between himself/the petitioner/1st defendant and the respondent/plaintiff's family members by which it was agreed that he should pay at least 11/2 times of the principal amount in full and final settlement of the loan amount as per the Debt Relief Act. Accordingly, on 12-11-96, he issued a cheque bearing No.763613 dated 12-11-96 for Rs.10,750/- on State Bank of India, in full and final settlement of the suit promissory note. It is also his claim that in spite of the same, the plaintiff's family members refused to return the promissory note. It is also contended that the last date of payment of cheque is dated 12-11-96 and it is not for the period upto 31-12-96 as claimed. If that is so, according to the first defendant, the suit filed on 26-11-99 is barred by limitation. Though the learned counsel for the respondent disputes the claim of the petitioner/first defendant, after going through the specific averments in the affidavit filed in support of the application to leave to defend the suit and the documents filed before the trial Court, I am satisfied that the first defendant has prima facie made out a case at least with reference to limitation in discharging the entire loan amount by last payment dated 12-11-96. All these materials would show that the first defendant has made out a case that he has valid defence to contest the suit.
11. In this regard, it is useful to refer Order 37 C.P.C., which deals with summary procedure. Rule 3 prescribes procedure for appearance of defendant.
"Order 37, Rule 3 (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 defence to raise or that the defence intended to be put up by the defendant is frivolous or 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."
There is no dispute that defendants 1 and 2 have filed separate petition supported by an affidavit within 10 days of service of summons highlighting their defence and prayed for leave to defend unconditionally. The first Proviso makes it clear that if the Court is satisfied that the facts disclosed by the defendants indicate substantial defence leave shall not be refused.
12. It is also useful to refer a decision of the Apex Court in Mechalec Engineers and Manufacturers v. M/s. Basic Equipment Corporation, . In the said decision, after considering the scope and ambit of Order 37, Rule 3 (2), the following proposition have been laid down for conditional/unconditional grant of leave to defend: (para 8) "8. In Sm. Kiranmoyee Dassi v. Dr.J. Chatterjee, (1945) 49 Cal WN 246 at p.253, Das, J., after a comprehensive review of authorities on the subject, stated the principles applicable to cases covered by Order 37, C.P.C. in the form of the following propositions (at p.253):
"(a) If the defendant satisfies the Court that he has a good defence to the claim on its merits the plaintiff is not entitled to leave to sign judgment and the defendant is entitled to unconditional leave to defend.
(b) If the defendant raises a triable issue indicating that he has a fair or bona fide or reasonable defence although not a positively good defence the plaintiff is not entitled to sign judgment and the defendant is entitled to unconditional leave to defend.
(c) If the defendant discloses such facts as may be deemed sufficient to entitle him to defend, that is to say, although the affidavit does not positively and immediately make it clear that he had a defence, yet, shews such a state of facts as leads to the inference that at the trial of the action he may be able to establish a defence to the plaintiff's claim the plaintiff is not entitled to judgment and the defendant is entitled to leave to defend but in such a case the Court may in its discretion impose conditions as to the time or mode of trial, but not as to payment into Court or furnishing security.
(d) If the defendant has no defence or the defence set up is illusory or sham or practically moonshine then ordinarily the plaintiff is entitled to leave to sign judgment and the defendant is not entitled to leave to defend.
(e) If the defendant has no defence or the defence is illusory or sham or practically moonshine then although ordinarily the plaintiff is entitled to leave to sign judgment, the Court may protect the plaintiff by only allowing the defence to proceed if the amount claimed is paid into Court or otherwise secured and give leave to the defendant on such condition, and thereby show mercy to the defendant by enabling him to try to prove a defence."
13. I have already referred to the fact that second defendant has not joined in execution of the promissory note though her signature finds a place at the bottom of the promissory note. In so far as the first defendant is concerned, the point raised by him relating to limitation, payment of Rs.10,750/- by way of cheque dated 12-11-96 in full and final settlement of the suit promissory note etc., would show that he has made out a defence to contest the suit. The defence set up by him (first defendant) cannot be termed as illusory or sham or moonshine, disentitling him to leave to defend the suit. All the material aspects have not been considered by the Court below. I am also of the view that the Court below ought to have given an opportunity to the defendants 1 and 2 to establish their defence by granting unconditional leave.
14. In the light of what is stated above, the impugned common order of the XI Assistant Judge, City Civil Court dated 15-4-2002 passed in I.A.Nos. 14060 and 14059 of 2001 is set aside and both the Revisions are allowed. No costs.