Delhi High Court
Cosmos Builders Promoters (P) Ltd. And ... vs Rajesh Ahuja And Anr. on 1 February, 1997
Equivalent citations: 1997IIAD(DELHI)653, 66(1997)DLT151
Author: Manmohan Sarin
Bench: M.J. Rao, Manmohan Sarin
JUDGMENT Manmohan Sarin, J.
(1) ADMIT.
(2) These two appeals have been preferred against the order dated 1.9.95, -passed by the learned Single Judge whereby learned Single Judge. dismissed the application (I.A. 5113/93) under Order 37 Rule 3(5) of the Code of Civil Procedure, filed by the appellants in Suit No. 309/93, seeking leave to contest the suit. Learned Single Judge held that no triable issues were involved and contentions raised in defense were frivolous. As a consequence of dismissal of IA. 5113/93, the suit was decreed against the appellants for a sum of Rs. 18,97,093.85, which included the principal amount of Rs. 16,93,867.70 and interest amounting to Rs. 2,03,226.15 @ 18% instead of 24%. Learned Single Judge granted future interest @ 18% on the principal amount of Rs. 16,93,867.70 from the date of suit. Aggrieved by the rejection of their leave to contest, the appellants have preferred the above appeals.
(3) Fao (OS) 292/95 is preferred by M/s. Cosmos Builders and Promoters (P) Ltd. while Fao (OS) 293/95 is preferred by Sh. Manoj Mittal, wherein M/s. Cosmos Builders and Promoters (P) Ltd. have been imp leaded as a proforma respondent. Let us briefly notice the relevant facts giving rise to the present appeals :
(4) The respondent/ plaintiff, Sh. Rajesh Ahuja filed the Suit No. 309/93 against Sh. Manoj Mittal, appellant/defendant No. 1 and M/s. Cosmos Builders and Promoters (P) Ltd.,-appellant/defendant No. 2. The suit was filed by Sh. Rajesh Ahuja, former Managing Director of M/s. Cosmos Builders and Promoters (P) Ltd., contending that he was dealing in real estate and that he had entered into a contract with M/s. Methodist Church on behalf of M/s. Consumes Builders and Promoters (P) Ltd., for construction of residential flats, which came to be known as the "Battery Lane Project". It is his contention that he had suffered losses in business of M/s. Cosmos Builders and Promoters (P) Ltd., and thereupon he invited one Mr. Ashok Verma and his wife Mrs. Meenakshi Verma to be Directors in the Company and sold a large number of shares in their firm keeping about 15 percent shares with him. The appellant, Sh. Manoj Mittal, his father and other members of the family acquired the remaining 85 percent shares in the Company, from transferees of the shares. The appellants were interested in acquiring the remaining 15 percent shares held by respondent Sh. Rajesh Ahuja, who finally agreed to sell them in writing for a total consideration of Rs. 19 lakhs. Towards the payment of Rs. 19 lakhs, the following cheques were issued by the appellants Manoj Mittal and M/s. Cosmos Builders and promoters (P) Ltd. Cheque No. 012277 dated 11.4.92 for Rs. l,04,850.00 of M/s. Bhatinda Chemicals Ltd. Post-dated Cheque Nos. 825453 dated 10.10.92 for Rs. 17,95,150.00 of M/s. Consumes Builders & Promoters Pvt. Ltd. It was then alleged that the appellant No. 1 being unable to arrange for the funds i.e.. Rs. 17,95,150.00 , requested Sh. Rajesh Ahuja to return the cheque and in lieu thereof agreed to issue two cheques for the said amount. The appellant, Sh. Manoj Mittal then gave cheques bearing Nos. 825455 dated 24.4.92 for Rs. 1,01,282.30 and 825456 dated 10.10.92 for Rs. 16,93,867.70. Cheque No. 012277 dated 11.4.92 for Rs. l,04,850.00 and cheque No. 825455 dated 24.4.92 for Rs. 1,01,282.30 issued by the appellants have been encashed. However, Cheque No. 825456 for Rs. 16,93,867.70 could not be encashed for "insufficient funds". In the event, Rajesh Ahuja then filed the present suit under Provisions of Order 37, Civil Procedure Code claiming a total sum of Rs. 19,64,868.00 comprising Rs. 16,93,867.70 as principal plus 24% interest.
(5) Having noticed the salient averments in the plaint, let us notice the appellants' case based on the grounds set out in the application for leave to contest and in the present appeals. The first contention raised by the appellants was that the respondent had agreed to sell the 15% holding being 13860 shares @ Rs. 10.00 each for a total sum of Rs. l,04,850.00 and that amount had been duly paid to the respondent/plaintiff as admitted by him. The appellants denied that they had agreed to purchase the shares for a consideration of Rs. 19 lakhs or that they had ever issued the cheque bearing No. 825453 dated 10.10.92 for Rs. 17,95,150.00 . The appellants urged that the respondent/plaintiff had failed to produce the original cheque and in the absence of it, no credence could be given to the said plea. The appellants' case is that out of total number of 13860 shares, sold to them, 8235 shares were fully paid shares that were sold for Rs. 10.00 each, while the remaining 5625 shares were partly paid and were sold @ 4.00 making the total sale consideration of Rs. l,04,850.00 (8235 x 10 = 82350 plus 5625 x 4 = 22500 = 1,04,850). (i) The appellants in support of their case relied on the Minutes of the Meeting of the Board of Directors dated 11.4.92, wherein the application of the respondent/ plaintiff for transfer of shares was put up and approved. The said Minutes are duly signed by the respondent/plaintiff. It would be useful to reproduce the following extract from the Minutes of the Meeting dated 11.4.92. Transfer of Shares The Chairman placed before the Board the application for transfer of shares from Sh. Rajesh Ahuja transferring his shares in favour of Sh. Manoj Mittal as per details undemoted: S.L. No. Total No. Amount per Nominal Dist. No. shares share paid-up value from to 1/31.8.91 8235 Rs. 10.00 Rs. 82,350.00 001-100 401-1230 6401-7330 49901-56275 2/31.8.91 5625 Rs.4.00 Rs. 22,500.00 12401-15210 24901-27715 Total - 13860.00 Rs. 1,04,850.00 The Chairman further informed that respective share certificates are being surrendered by Sh. Rajesh Ahuja to enable the Company to register the entry of transfer. After some discussion, the Board decided to register the transfer. The following resolution was unanimously passed. Resolved that transfer of 13,860 equity shares of the Company as per the detail undernoted by Sh. Rajesh Ahuja to Sh. Manoj Mittal be and is hereby approved. Resolved further that entries of transfer be made in the respective share certificates and books of the Company. S.L. No. Total No. Amount per Nominal Dist. No. shares share paid-up value from to 1/31.8.91 8235 Rs. 10.00 Rs. 82.350.00 001-100 401-1230 6401-7330 49901-56275 2/31.8.91 5625 Rs.4.00 Rs. 22.500.00 12401-15210 24901-27715 Total - 13860 Rs. 1,04,850.00 Resignation of Director Sh. Rajesh Ahuja informed the Board that due to his pre-occupation he will be unable to continue as the Director of the Company any more. He placed before the Board his resignation letter and suggested that he may please be relieved of his duties with immediate effect. The Board discussed the matter and then decided to accept the resignation with regret. It was unanimously agreed that Sh. Rajesh Ahuja shall not have any claim, right, interest whatsoever towards the Company/and vice versa. After that the following resolution was unanimously passed. Resolved that resignation of Sh. Rajesh Ahuja from the Directorship of the Company be and is hereby accepted with immediate effect." The Board recorded their appreciation for the service of the outgoing Director. There was a general discussion regarding the affairs of the Company. However, no formal resolution was passed. The meeting ended with a vote of thanks to the Chairman."
(II)Reliance is also placed on letter written by the respondent by which he forwarded the share certificates. In the said letter after giving details of total number of shares and total value at Rs. l,04,850.00 the respondent/plaintiff wrote as under:
"Please note that I have sold the shares in favour of Sh. Manoj Mittal, S/o Sh. D.D. Mittal, R/o 201/6, Kaushlya Park, Hauz Khas, New Delhi for valid consideration, you are hereby requested to transfer the shares in his name."
(III)Reliance is also placed by the respondent on the Minutes of Meeting of the Board of Directors dated 12.8.91, wherein 42850 equity shares of the Company were allotted to the appellants as well as to the respondent and two others @ Rs. 10.00 each. This is to butress the argument that the value of the shares was Rs. 10.00 each. In this connection, it is submitted by the appellants that the Company admittedly was being run in loss. They were already having 85 percent of the shares, and were in full control of the Company. There would not be any occasion for them to purchase the remaining 15% shares @ 137.00 per share from the respondent/plaintiff for a consideration of Rs. 19 lakhs. The appellants urged that no prudent person would take upon himself such an onerous burden for buying shares at 14 times the face value of a Company running in loss and of which as they already had full control with 85 percent holding.
(IV)As regards the cheque for Rs. 1,01,282.35, the explanation of the appellants is that the said cheque was in respect of the amount lying in the Company, to the credit of the respondent and the same had been remitted to him. It is claimed that the said cheque had nothing to do with the sale consideration of the shares and was not part of the sale consideration of Rs. 19 lakhs.
(V)As regards, cheque bearing No. 825456 dated 10.10.92 for Rs. 16,93,867.50, the appellants contend that the respondent/plaintiff had agreed to supply Marble of 'A' Class quality admeasuring about one lakh sq. feet and that the appellants issued towards advance, the above cheque. The supplies were to commence in August, 1992 and had to be completed by October, 1992. It is alleged that the plaintiff/respondent failed to supply Marble or to return the aforesaid cheque of Rs. 16,93,867.70. The appellants claim to have served legal notice dated 22.2.92, demanding damages and return of cheque. The appellants perforce also filed a suit bearing No. 626/92 dated 2.12.92, before the District Judge for recovery of Rs. 5 lakhs as damages from the respondent/ plaintiff for non-supply of Marble.
(6) Leaned Single Judge accepted the version of the respondent/plaintiff that the original cheque bearing No. 825453 for Rs. 17,95,150.00 had been returned to the appellants that is why the respondent/plaintiff could only produce a photocopy thereof. Learned Single Judge accepted the version of respondent/plaintiff that cheque for Rs. 1,01,282.30 and cheque for Rs. 16,93,867.70 were given in lieu of the cheque for Rs. 17,95,150.00 . He also disbelieved the version of the appellants that cheque for Rs. 16,93,867.70 was issued towards advance for the supply of Marble. Learned Single Judge observed that the odd sum of Rs. 16,93,867.70 could hardly be given as advance towards an alleged transaction for supply of Marble, without any document or agreement having been executed. Besides, if indeed it was advanced, the same would have been a round figure rather than an odd figure of Rs. 16,93,867.70. Learned Single Judge also noticed that the three cheques were issued serially from one and the same cheque book and, therefore, denial of the first cheque bearing No. 825453 for Rs. 17,95,150.00 was a false one. The appellants did not claim that the said cheque had been issued to some other person or was not for the said amount of Rs. 17,95,150.00 . Learned Single Judge also accepted the version of respondent/plaintiff that the said cheque had been returned. The photocopy of the cheque showed that it had been signed by appellant No. 1 and was even initialed by him, for the over-writing. Learned Single Judge also referred to the document/ writing under which the appellants had agreed to pay Rs. 19 lakhs for the purchase of shares and wherein the cheque No. 825453 for Rs. 17,95,150.00 was also mentioned. Learned Single Judge also held that the appellants had failed to tender any plausible explanation for payment of the additional amount of Rs. 1,01,282.35 if the sale price was Rs. l,04,850.00 . Learned Single Judge also noticed that the cheque for Rs. 16,93,867.70 had been returned on account of "insufficient funds".
(7) The appellants have also raised certain other contentions with regard to the reliefs claimed in the suit, being outside the scope and ambit of Order 37, CPC. Interest had been claimed @ 24% without any agreement for payment of interest. It is also submitted on behalf of M/s. Cosmos Builders and Promoters (P) Ltd., in Appeal No. 292/95 that admittedly the shares had been purchased by the appellant, Sh. Manoj Mittal and the agreement for sale of shares is between him and the respondent/plaintiff. There was no contract of sale between the appellant Company which did not come into the picture at all. It was not even the case of the respondent/plaintiff that the appellant Company purchased the shares from him and did not pay for shares purchased. Even the cheque for Rs. l,04,850.00 had been issued by the appellant No. l's Bhainda Company. In these circumstances, the decree against the Company could not have been passed in the absence of any contract with the Company or any consideration being received by the Company.
(8) The crucial questions that need consideration in this case are whether the defense of the appellants raises any triable issues or not? Further whether the pleas raised are sham and frivolous so as to refuse leave to contest? The question, therefore, which comes in the forefront requiring an answer is, are the defenses such so as to shut out the appellant and decree the suit without giving an opportunity to appellants to prove their case in trial?
(9) The respondent, as noticed earlier, claimed that the entire remaining share holding in appellant No. 2 was agreed to be sold for Rs. 19 lakhs for which two cheques bearing Nos. 825453 dated 10.10.92 for Rs. 17,95,150.00 and cheque No. 012770 dated 11.4.1992 of M/s. Bhatinda Chemicals Limited for Rs. l,04,850.00 were issued. Respondent also relied on the writing dated 11.4.1992, copy of which had been filed alongwith the plaint. It was averred in the plaint that earlier sale of 70 percent of the share holdings was for Rs. 70 lakhs. The respondent claims to have earlier sold the shares to M/s. Gujarat Estates Pvt. Ltd. and M/s. Aedee Housing Private Limited, which tends to show that sale consideration was Rs. 19 lakhs and not Rs. l,04,850.00 . It is stated that the sale consideration realised from the sale of shares so sold were invested in Hudco Capital Gains Bond. This coupled with the writing dated 11.4.92 according to respondent clearly established that the sale price was Rs. 19 lakhs, for which the appellant had issued the cheques aforementioned. The respondent categorically denies that the shares were sold only for Rs. l,04,950/ -, which, according to the respondents, reflected only the "nominal value" on which the share transfer duty had been paid. Reference was also invited to Blacks Law Dictionary wherein the expression "Nominal Consideration" is defined as "One bearing no relation to the real value of the contract or article as where a parcel of land is described in a deed as being sold for one dollar, no actual consideration passing or the real consideration being concealed." Regarding the return of cheque for Rs. 17,95,150.00 and its replacement by two cheques for Rs. 16,93,867.70 and Rs. 1,01,282,30, respondent says that the sum of Rs. 1,01,282.30 represented the amount that was outstanding in his favour in the books of account of the Company. As the Agreement dated 11.4.92 was in "full and final settlement", the appellants demanded that the amount be deducted from Rs. 17,95,150.00 and accordingly two cheques for Rs. 16,93,867.70 and Rs. 1,01,282.30 were issued. Learned Counsel for the respondent urged that the factum of two post-dated cheques being dated 10.10.92, i.e., exactly six months after the agreement dated 11.4.92 and the three cheques being issued from the same cheque book would show their being interlinked and part of the same transaction. The appellants had failed to produce the original cheque No. 82543 for Rs. 17,95,150.00 and their explanation regarding the issuance of said cheque to someone else was found to be palpably false by the Single Judge.
(10) Respondent also laid considerable emphasis that the appellants' plea of the amount of Rs. 16,93,867.70 being an advance towards the Marble purchased was utterly false. The defense was a sham and an illusory one. Learned Counsel also relied on the tax returns of the respondent, filed in the usual course of business, wherein the said sum is shown as outstanding from the appellants.
(11) Reliance was placed by the respondent on the under-mentioned-decisions to support the rejection of the leave to contest : (i) Mechalec Eng. & Manf. v. Basic Equip. Corp., . (ii) M.D. International Inn & Anr. v. K.L. Sethi, 1991 (2) Current Civil Cases 422. (iii) Anchal (Binny Showroom) v. Anand Prakash & Ors., .
(12) To support the claim for interest under Order xxxvii suit, without there being an agreement, therefore, and the suit being based on negotiable instrument, reliance was placed on the following judgments : (i) Khera Handloom Supply v. O.B. Exports & Ors., (ii) Dharamdas v. Shidya jatra, .
(13) On a careful consideration of the pleas taken in the application for leave to contest and replies thereto as well as the documents filed in support thereof, the position that emerges is that the appellant has produced a writing, wherein 13860 shares are said to be transferred for Rs. l,04,850.00 . It is on this value that the share transfer deeds have been stamped and registered. Simultaneously, the respondent also tendered his resignation from the Directorship and requested for transfer of his shares, which had been transferred for "consideration" described by the respondent as "nominal value" in one document and "valid consideration" in another. The Minutes of an earlier Meeting of August, 1991, where shares had been duly allotted to the appellants as well as the respondents, show that the same were at a value of Rs. 10.00 each. It is in this context that the appellants claim that no prudent man already having full control with 85% of the share holding would purchase the shares of a Company which was admittedly running in loss at Rs. 137.00 per share which would be the value if sale consideration was Rs. 19 lakhs, deserves to considered. The Book Value of shares is stated to be between Rs. 5.37 to Rs. 9.37 per share as on 31.3.91 and 31.3.92 respectively. As against this, the respondent relied on the writing dated 11.4.92 which mentioned the consideration for transfer of shares at Rs. 19 lakhs. It is noticed from the plaint that the respondent had based its suit on the dishonoured cheque No. 825456 dated 10.10.92 for Rs. 16,93,367.00 . The respondent in para 5 of the plaint simply averred that the appellant No. 1 and his father had agreed to purchase the share holding of the respondent for Rs. 19 lakhs. It was averred, inter alia, "on that day it was evidenced in written that the plaintiff would resign from the Company and the said sum of Rs. 19 lakhs would be paid". This is how the agreement' was described in the plaint. The respondent did not make the "said writing dated 11.4.92" as an annexure to the plaint. Instead, it is noticed that a photo-copy of the same had been filed alongwith a list of documents. Even in the application for issuance of service of summons for judgment, on the defendant the respondents did not mention or refer to the said agreement dated 11.4.92. We have also before us official Minutes of the Meeting of the Board of Directors wherein the value of transfer of shares is given as l,04,850.00 . Simultaneously, the resignation is accepted. The transfer deeds are executed and stamped with the same value. Admittedly, cheque for the amount of Rs. l,04,850.00 dated 11.4.92 issued by the appellant has been enached. The respondent's version is that the sale consideration was Rs. 19 lakhs out of which a cheque bearing No. 012277 dated 11.4.92 for Rs. l,04,850.00 , referred to above, was issued and another post-dated cheque bearing No. 825453 dated 10.10.92 for Rs. 17,95,150.00 , was issued. As would be recalled, it is the respondent's case that in lieu of this last cheque the appellant gave two cheques bearing No. 825455 dated 24.4.1990 for Rs. 1,01,282.30 and Cheque No. 825456 dated 10.10.92 for Rs. 16,93,867.70.
(14) It is not for us at this stage to delve deeper into or to speculate as to what were the undisclosed understandings and factors which led the parties into executing two different documents showing varying amounts of consideration namely Rs. 19 lakhs and Rs. l,04,850.00 . May be it was intended that the sale to be shown for the purposes of stamp duty and share transfer fee is at the lower rate figure, in which case both the parties were in peri delicto for defrauding the revenue. Alternatively, if the sale consideration was indeed Rs. 19 lakhs, it is not clear as to why the respondent would accept deferment by six months of the major portion of the sale consideration and yet simultaneously handover share certificates and execute transfer deeds. Whatever be the true nature of agreement and understanding between the parties, the appellant and the respondents by the execution of documents showing varying sale consideration and terms and having regard to the earlier values at which shares were purchased, have resulted in contentious and triable issues being raised, calling for trial.
(15) Apart from the above, another factor which raises a contentious issue is the respondent's contention regarding replacement of the cheque bearing No. 825453 dated 10.10.92 for Rs. 17,95,150.00 by the two cheques of Rs. 1,01,282.30 and Rs. 16,93,367.70. The respondent's case is that since the agreement of 11.4.92 was in full and final settlement, the appellants had insisted on reduction of the amount of Rs. 1,01,282.30 lying to the credit of the respondent from the sale consideration. The appellant's contention, on the other hand, is that this amount had nothing to do with the sale consideration of the shares and was refunded to the respondent as it was lying to his credit. This issue again is a contentious one and the appellant's contention that this amount had nothing to do with the sale consideration cannot be brushed aside without trial.
(16) We may also observe that the appellant's plea regarding the said cheque of Rs. 16,93,367.70 having been advanced towards the supply of white Marble for the project does not, prima fade, appear to be plausible or bonafide one especially since the amount advanced is said to be without any writing and curiously is not even a round figure, as would normally have been. However, we cannot lose sight of the fact that for an advance or security the appellants had served a notice and instituted a suit on 2.12.92 in the District Court for recovery of Rs. 5 lakhs as damages. This was prior to the institution of the present suit by respondent.
(17) Having discussed the factual matrix of the case, we may notice the law as laid down by the Apex Court in Santosh Kumar v. Bhai Mool Singh, . The Apex Court while laying down the principles for grant of leave and exercise of discretion under Order xxxvii, Rule 3(2), Cpc, observed as under :
"Wherever the defense raises a triable issue leave must be given. When that is the case, it must be given unconditionally otherwise the leave may be illusory. If the Court is of the opinion that the defense is not bonafide one, then it can impose conditions and is not tied to refusing leave to defend."
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"Where the defense is a good and valid one, conditions cannot be imposed. Power to impose conditions is only there to ensure that there may be a speedy trial. If there is reason to believe that the defendant is trying to prolong the litigation and evade a speedy trial then conditions can be imposed. But that conclusion cannot be reached simply because the defendant does not adduce his evidence even before he is told that he may defend the suit."
(18) Reference may also be made to the decision of the Apex Court in Raj Duggal v. Ramesh Kumar Bansal, Air 1990 Sc 2219.
"Leave is declined where the Court is of the opinion that the grant of leave would merely enable the defendant to prolong the litigation by raising untenable and frivolous defenses. The test is to see whether the defense raises a real issue and not a sham one, in the sense that if the facts alleged by the defendant are established there would be a good or even a plausible defense on those facts. If the Court is satisfied about that leave must be given. If there is a triable issue in the sense that there is a fair dispute to be tried as to the meaning of a document on which the claim is based or uncertainty as to the amount actually due or where the alleged facts are of such a nature as to entitle the defendant to interrogate the plaintiff or to cross-examine his witnesses leave should not be denied. Where also, the defendant shows that even on a fair probability he has a bonafide defense, he ought to have leave. Summary judgments under Order 37 should not be granted where serious conflict as to matter of fact or where any difficulty on issues as to law arises. The Court should not reject the defense of the defendant merely because of its inherent implausibility or its inconsistency."
"On a consideration of the material in this case - we have looked into the defense sought to be raised and the criminal complaint earlier lodged - we think that a triable issue arises. On the analogous provisions of Order 14 of the Rules of Supreme Court in England it was held that where the defense can be described as more than "shadowy" but less than "probable" leave to defend should be given."
(19) Keeping in mind the principles laid down by the Apex Court in the aforesaid decisions, we are of the view that this is not a case where leave to contest should have been refused. The appellants as discussed in paras 14 and 15 have raised triable and contentious issues. Even though the defense raised may not be a plausible or appear to be a bonafide one, this is a fit case where in our view the defendants, appellants in this appeal, should not have been completely shut out and should have been permitted to defend the suit subject to conditions being imposed.
(20) Learned Counsel for the respondents had referred to the decision in Anchal (Binny Showroom) v. Anand Prakash & Ors., . The Court in the said case had dismissed the revision petition. The suit was based on a cheque which had been dishonoured. The defense taken was that the cheque had been issued in advance and the goods were not supplied. Therefore, the cheques got dishonoured. The Court held that merely taking a bare and bald plea that the goods were not supplied and the cheques were got dishonoured would not enable the petitioner to obtain the leave, especially when no reply to the legal notice had been given. The said case is clearly distinguishable. As discussed above, contentious and triable issues arise in this suit. Besides, in the instant case whatever may be the ultimate result of the defense taken, a notice had been served by the appellants, followed by a suit that had been instituted wherein they claimed that money had been advanced towards the supply of Marble.
(21) Similarly, in M.D. International Inn and Another v. K.L. Sethi, 1991 (2) Current Civil Cases 422, relied on by the respondents, the Court had reached the conclusion that the defense set up was sham and illusory and contrary to the written agreement, which was not permissible under Section 92 of the Indian Evidence Act. The said case is also, accordingly, distinguishable.
(22) In the view, we have taken it is not necessary for us to decide on the plea of the appellant No. 2 that the plaint did not disclose any cause of action against it and it cannot be fastened with any liability since the contract for sale of shares was with appellant No. 1. We may notice that this objection was not taken in the application for leave to contest. It is also not necessary for us to decide the objection on maintainability of the suit under Order xxxvii at this stage because of the claim for interest at 24%. However, it would be open for the appellants to raise the said plea as well as other legal objections on the maintainability of the suit in the written statement.
(23) In view of the foregoing discussion, the appeals are allowed. The impugned order dated 1.9.95 dismissing I.A. 5113/93 that is the application for leave to contest is set aside and the appellants are permitted to defend the suit subject to their depositing a sum of Rs. 10 lakhs in Court and furnishing security of movable or immovable property for a further sum of Rs. 10 lakhs subject to the satisfaction of the Joint Registrar of this Court. The amount of Rs. 10 lakhs deposited be kept in fixed deposit in nationalized Bank during the pendency of the suit. The aforesaid deposit and security shall be made and furnished within four weeks from today. The appeals are allowed subject to the aforesaid conditions and directions. Appeals allowed.