Delhi District Court
Rohtash Kumar vs Sonu @ Inder Raj on 19 May, 2011
IN THE COURT OF SHRI. ASHISH AGGARWAL, CIVIL JUDGE1,
DWARKA COURTS, DELHI
CS No: 355/11
Unique case ID No. 02405C0139192011
Rohtash Kumar
S/o Late Sh. Desh Ram
R/o WZ799/2, Palam Village,
New Delhi45. ... Plaintiff
Versus
Sonu @ Inder Raj
S/o Sh. Chandermal,
R/o RZA10, Sitapuri,
Behind Dabri Police Station,
New Delhi45.
Also At:
Plot No. 805, 806 & 814
Block - C, Goela Dairy,
New Delhi. ... Defendant
Date of Institution: 29.03.2011
Date on which judgment was reserved: 14.5.2011
Date of pronouncing judgment: 19.5.2011.
SUIT FOR RECOVERY OF RS.2,92,800/ UNDER ORDER XXXVII OF CODE OF
CIVIL PROCEDURE
ROHTASH KUMAR VS. SONU @ INDER RAJ
CS No. 355/11 1 of 11
J U D G M E N T
1. This is a suit under Order XXXVII of Code of Civil Procedure, 1908. The plaintiff has instituted the suit pleading that the plaintiff and the defendant were on friendly terms. In April 2009, the defendant requested the plaintiff to advance personal loan of Rs.2,40,000/. The plaintiff advanced friendly loan of Rs.2,40,000/ to the defendant. The defendant executed a promissory note and an affidavit dated 22.04.2009 acknowledging his liability. He undertook to repay the friendly loan with interest at the rate of 12% per annum as and when demanded. On 15.10.2009, the plaintiff demanded return of the loan amount. The defendant failed to do so and requested for a further period of two months for repayment, which was acceded too. Thereafter, the defendant continued to avoid making payment. The plaintiff served legal notice dated 20.12.2010 to the defendant demanding payment. The defendant yet failed to pay the said sum. The plaintiff has instituted the present suit seeking recovery of a sum of Rs.2,92,800/ alongwith pendente lite and future interest at the rate of 12% per annum and costs.
2. Application for leave to defend has been filed on behalf of the defendant on the ground that the did not receive any money from the plaintiff and that he is educated only upto sixth standard and therefore does not know English. It is further stated that the suit does not come within the ambit of Order XXXVII of Code of Civil Procedure. It is denied that the plaintiff and the defendant were on friendly terms and that the loan was advanced by the plaintiff to the defendant. It is further stated that blank ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 2 of 11 papers/promissory note and affidavit were got signed by the plaintiff from the defendant regarding supply of milk.
3. I have heard arguments and have perused the record.
4. According to the plaintiff, the defendant had availed friendly loan of Rs.2,40,000/ from the plaintiff. The defendant failed to repay the loan. As against this, the defence set out is that loan was never taken and that the documents were executed only for supply of milk. The following needs to be noted:
A. In para no. 4 of the affidavit of the defendant enclosed with the application for leave to defend, the defendant has denied that he had executed the documents relied upon by the plaintiff namely promissory note and affidavit. On the other hand, he has stated in the same affidavit that he had signed some blank papers, promissory note and affidavit. These statements are contradictory and inconsistent.
In the case of Major Kuldeep Singh Jarg Retd. v. M/s Bax Global India Ltd, 2008(4) A.D.(Delhi) 265, the Hon'ble High Court of Delhi held that a defendant who raises inconsistent pleas is not entitled to leave to defend. It was observed as under:
"Noting the ipsidixit and ever changing stand of the petitioners with regard to claims pertaining to the fine imposed by HSIDC, damages caused by the respondent company to the plot and payment of outstanding electricity and water bills I find no meat in the defence of the petitioners that respondent company owed a sum to the petitioners on account of said three claims."
ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 3 of 11 B. The defence raised by the defendant does not inspire confidence. The defendant had consciously executed the the promissory note, receipt and affidavit. The promissory note clearly stipulates the rate of interest and other terms and conditions. The defendant cannot be permitted to plead ignorance thereof. It was his duty to read the agreement and to satisfy himself as to its terms and conditions before executing the agreement. After having executed the agreement, after having availed the loan and after defaulting in repayment, he cannot be permitted to resile from its terms on the ground that he had not understood their import. Such a plea is nothing but a feeble attempt to escape from one's contractual liabilities. If the defendant is permitted to release himself from the documents admittedly signed by him, the very purpose of executing the documents would be frustrated and the documents would be rendered devoid of sanctity. It is not the case of the defendant that he was made to sign the agreement against his consent or under coercion, pressure or undue influence. Nor has any complaint of this nature has been preferred by the defendant. Having voluntarily and consciously entered into the agreement, the defendant cannot be now permitted to withdraw therefrom. Reference may also be made to Section 92 of the Evidence Act, 1982 which excludes oral evidence to deviate from the terms of a written contract.
In the case of Bank of Baroda Vs. M/s Kayenkay Agencies and Ors., AIR 2003 NOC 495 (Delhi), the Division Bench of Hon'ble High Court of Delhi refused to grant leave to defend a suit for recovery of dues based on ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 4 of 11 overdraft facility. The defence raised by the defendant in that case was that the purchase facility had not been availed by the defendant. Holding that the defendant had not produced any evidence to substantiate that defence, the application for leave to defend was rejected and the suit was decreed.
In case of Minerals Metals Trading Corporation Ltd. vs. Dimple Overseas Ltd., AIR 2001 Delhi 427, the Division Bench of Hon'ble High Court of Delhi rejected the application for leave to defend in a suit for recovery of sale price of goods supplied to the defendant. In that case, the defendant had sought leave to defend on the ground that the quality of goods supplied to him was deficient. It was held that the plea was an afterthought for avoiding payment. he suit was decreed.
In case of V. K. K. Nair vs. Mrs. Kanchan Kanwar, AIR 2005 Madras 186, the Hon'ble Madras High Court was dealing with a suit for recovery of money based on a promissory note. The defence of the defendant was that he had executed the promissory note not in favour of the plaintiff but somebody else and that he had already made the entire payment. The application for leave to defend was rejected on the ground that it was not supported by any material. The suit was decreed.
In the case of ONGC Vs. State Bank of India AIR 2000 SC 2548, the Hon'ble Supreme Court held that leave to defend shall not be granted unless the existence of fraud pleaded to disclaim liability is clearly demonstrated. It was observed as under:
ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 5 of 11 "In the light of what is stated above, in the absence of a plea relating to fraud, mush less of a finding thereto, we find that the Court could not have stated that the defence raised by the respondent Bank on the grounds set forth earlier is sufficient to hold that unconditional leave should be granted to defend the suit".
C. The version of the plaintiff that he had advanced loan of Rs. 2,40,000/ to the defendant is supported, corroborated and strengthened by the written documents namely promissory note, receipt and affidavit. The promissory note clearly stipulates that the defendant has undertaken to the plaintiff that he shall pay a sum of Rs. 1,24,000/ with interest at the rate of 1% per month. The receipt acknowledges the fact that a sum of Rs. 1,24,000/ was given by the plaintiff to the defendant. By the affidavit, the defendant acknowledges the fact that he had borrowed a sum of Rs.2,40,000/ from the plaintiff, which he had to repay. The promissory note and the receipt bear revenue stamp. The defendant has signed on the revenue stamp. There is absolutely no merit in the plea of the defendant that he did not know the nature of the documents or that he signed the documents under the impression that they related to supply of milk. The said plea of the defendant cannot be believed. The defendant has himself stated in his affidavit that he had signed a promissory note. Had he intended to only stipulate regarding supply of milk, he would not have signed a promissory note. There is no reason for a supplier of milk to undertake by written document to continue to supply milk for one year. The circumstances which necessitated preparation of documents to record an ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 6 of 11 agreement to supply milk have not been explained by the defendant. Even if it is assumed that the defendant was not well educated, he could still have observed a revenue stamp upon which he had posted his signatures. There is no reason for the defendant to sign on revenue stamps affixed on blank papers. The documents in question do not even remotely suggest that they were prepared with a view to record an agreement regarding supply of milk. Had that been the case, the defendant would have at least provided some particulars of the quantity of milk, period of supply and other conditions. Nothing prevented the defendant to have entered into such agreement in Hindi, which he could understand. The defendant has himself stated in his affidavit in support of his application for leave to defend that he was not on friendly terms with plaintiff. If that is so, the defendant would have been all the more cautious to understand the terms of the agreement before signing it particularly when, according to the case of defendant himself, the agreement did not relate to a personal affair but concerned trade. It is difficult to comprehend that the defendant would blindly accept the version of the plaintiff as to the nature of the documents. The defendant therefore cannot be permitted to plead ignorance of the terms of the agreement duly signed by him. The defendant has claimed to have studied up to VI standard and claims to be in the trade of milk supply. He cannot claim to be ignorant of consequences of signing blank documents. If he does so, that must be at his peril. Further, there is no reason for the defendant to undertake to supply milk for one year.
ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 7 of 11 As to why there shall be written agreement to this effect has not been elaborated. Moreover, had there been an agreement regarding milk supply, the said agreement would have been signed by both the contracting parties and the defendant would have insisted on the signatures of the plaintiff too. However, the documents in the present case have been executed only by the defendant. No credence can therefore be attached to the contention of the defendant that the documents were intended to provide for supply of milk.
In the case of Delhi Book Store v. K. S. Subramaniam AIR 2006 Del 206, the Hon'ble High Court of Delhi declined leave to defend which was sought on the ground that the articles against which cheques were issued had never been supplied to the defendant. The Hon'ble High Court questioned as to why cheques were issued by the defendant if articles had not been supplied to him. Similarly, in the present case, the defendant has not been able to convincingly explained as to why he executed the promissory note, receipt and affidavit if loan had not been advanced to him.
Reference may also be made to the case of UBS AG v. State Bank of Patiala, AIR 2006 SC 2250.
D. The defendant has denied having received legal notice dated 20.12.2010. This plea is controverted by the receipts of courier. Yet, even if it is assumed that the plea of the defendant that he has not received legal demand notice is correct, that does not advance his defence. Service of legal notice is not a prerequisite to the institution of the suit. The plaintiff is under no ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 8 of 11 obligation to serve legal notice prior to instituting the suit. Even if it is assumed that the notice was not issued to the defendant, that does not permit the defendant to retract from his contractual liabilities.
E. The plea of the defendant that the suit is not covered by Order 37 of Code of Civil Procedure is bald and unsubstantiated. The suit is founded on written documents comprising of a promissory note, receipt and affidavit. Hence, the suit is squarely covered by Order 37 of Code of Civil Procedure. The plea of the defendant is not tenable.
In the case of M/s Mechalec Engineers and Manufacturers Vs. M/s Basic Equipment Corporation 1977 AIR SC 577, the Hon'ble Supreme Court held that leave to defend must not be granted if the defence set up is illusory, sham or practically moonshine.
In the case of Mrs. Raj Duggal v. Ramesh Kumar Bansal AIR 1990 SC 2218 it was held as follows :
"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 defences."
In the case of Santosh Kumar v. Bhai Mool Singh, AIR 1958 SC 321, it was held as under:
"It is always undesirable, and indeed impossible, to lay down hard and fast rules in matters that affect discretion. But it is necessary to understand the reason for a special procedure of this kind in order that the discretion may be properly exercised. The object is explained in Kesavan v. South India Bank ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 9 of 11 Ltd., ILR (1950) Mad 251 : (AIR 1950 Mad 226) (K), and is examined in greater detail in Sundaram Chettiar v. Valli Ammal, (F), (supra) to which we have just referred. Taken by and large, the object is to see that the defendant does not unnecessarily prolong the litigation and prevent the plaintiff from obtaining an early decree by raising untenable and frivolous defences in a class of cases where speedy decisions are desirable in the interests of trade and commerce."
5. Since the plaintiff has placed on record documents to establish the advancement of loan, which have admittedly been signed by the defendant and the defendant has not even pleaded that he had made payment of any loan amount, applying the principles enunciated in the aforesaid decisions, I find no force in the contentions of the defendant. The plea of the defendant is sham. The defendant has no substantial defence to raise and there are no triable issues in the case. The defendant is only trying to avoid the responsibility to repay the loan owed to the plaintiff which cannot be permitted. The application for leave to defend is hereby rejected.
6. The plaintiff is entitled to judgment and decree in his favour in accordance with Order 37 Rule 3 (6)(a) of Code of Civil Procedure, 1908.
7. I have gone through the contents of the plaint and also the documents filed in support thereof. The suit is within limitation and this Court is vested with territorial and precuniary jurisdiction to entertain the suit. Having perused the plaint and documents filed in support thereof, I am satisfied that the plaintiff has made out a case for recovery of the sum taken on loan by the defendant as well as presuit interest at the agreed rate. The plaintiff is entitled to recovery of a sum of Rs. 2,92,800/.
ROHTASH KUMAR VS. SONU @ INDER RAJ CS No. 355/11 10 of 11
8. The plaintiff has also prayed for pendente lite and future interest @ 12% per annum. However, keeping in view the fact that loan was not granted for a commercial purpose and it was a "personal loan", ends of justice would be met if the plaintiff is awarded interest at the rate of 6% per annum from the date of institution of the suit till the date of realization. The plaintiff is also entitled to recovery of costs of suit from the defendant.
9. Hence, in terms of Order XXXVII of Code of Civil Procedure, 1908, the suit is decreed in favour of the plaintiff and against the defendant for a sum of Rs.2,92,800/ alongwith interest at the rate of 6% per annum from the date of institution of the suit till the date of realization and also costs of the suit. Decree sheet be prepared accordingly. File be consigned to Record Room.
(Ashish Aggarwal)
Civil JudgeI/Dwarka Courts
Delhi/19.05.2011
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