Delhi District Court
Sanjay Puri vs Brij Bhushan Sharma on 10 October, 2008
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IN THE COURT OF SMT. PINKI
ADDITIONAL DISTRICT JUDGE : DELHI
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SUIT NO. : 59/04
DATE OF INSTITUTION : 10/02/2004
DATE OF RESERVING THE ORDER : 23/09/2008
DATE OF ORDER : 10/10/2008
IN THE MATTER OF :-
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SANJAY PURI,
A-8/21, VASANT VIHAR,
NEW DELHI-57.
.....PLAINTIFF
VERSUS
BRIJ BHUSHAN SHARMA,
S/O LATE SH. G.D. SHARMA,
R/O 1A-161, NIT, FARIDABAD,
HARYANA.
.....DEFENDANT
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O R D E R
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1. Vide this order I shall propose to decide two separate applications. The first application dated 19/04/2004 is under Order XXXVII R-3(5) of moved by defendant through counsel on 19/04/2004 praying for grant of unconditional leave to defend and the second application is under Order VII R-11(d) read with Sec.151 Code of Civil Procedure dated 19/04/2004 moved by defendant through counsel on 19/04/2004 praying for rejection of plaint.
2. Suit no.59/2004 titled Sanjay Puri V/s Brij Bhushan Sharma was filed on 10/02/2004 by plaintiff through counsel under Order XXXVII Code of Civil Procedure praying for recovery in sum of Rs.15,45,000/- (Rs. Fifteen Lakhs Forty Five Thousand) along with interest as on 01/02/2004 as well as pendente lite and future interest till the date of realization. -3-
3. Briefly stating the facts as averred in the plaint are that the plaintiff has advanced a loan in sum of Rs.15,00,000/- to the defendant on 17/10/2003 upon the request of the defendant. The defendant has received the loan amount on 17/10/2003. It was payable on 01/11/2003 and 30/11/2003 for which defendant had issued two postdated cheques i.e. cheque no.370103 dated 01/11/2003 for Rs. 4,00,000/- drawn at Neelam Chowk branch, Faridabad of ICICI Bank and the second cheque no.370104 dated 30/11/2003 for Rs.11,00,000/- drawn at Neelam Chowk branch, Faridabad of ICICI Bank, drawn in favour of the plaintiff
4. The defendant had approached the plaintiff and requested to present the first cheque dated 01/11/2003 along with the second cheque on 30/11/2003. The plaintiff on account of long standing cordial relations between the parties exceeded to the request of the plaintiff. On 30/11/2003 the defendant again requested the plaintiff to present these two -4- cheques after about a week. On presentation these two cheques were returned with the endorsement of bank dated 10/12/2003 ''Insufficient funds''.
5. The defendant while receiving the loan of Rs.15,00,000/- had executed two affidavits in favour of the plaintiff to the effect that these cheques would not be dishonoured on presentation.
6. Despite following up the matter regularly with defendant, the defendant did not pay. Plaintiff got issued legal notice dated 24/12/2003. Despite that also defendant failed to make the payment.
7. On service of summons of the suit defendant put in appearance on 20/02/2004. Summons for judgment were issued and defendant filed leave to defend application on 19/04/2004 which is under disposal.
8. Vide order dated 14/09/2004 the suit was -5- dismissed in default. It was restored vide order dated 31/03/2005 passed by the Ld. Predecessor of this court. After restoration of the suit, the Ld. Predecessor of this court has passed the order for issuance of notice to defendant who was contesting the suit and had filed leave to defend application. Ultimately the defendant could be served only by way of publication in the newspaper ''Veer Arjun'' and ''National Herald'' being circulated in NIT, Faridabad, Haryana for 27/09/2007. On 27/09/2007 Sh. Suraj Kumar, Advocate, had appeared for applicant/defendant. Vide order dated 27/09/2007 Sh. Suraj Kumar, Advocate, had submitted that he has left 215, Lawyers Chamber, Patiala House Court as even Ld. counsel for defendant Sh. Suraj Kumar could not be served for notice of restoration of the suit, therefore, Ld. counsel for defendant was directed to file fresh address of defendant because the defendant could not be served with notice of restoration of suit.
9. I have heard Sh. Suraj Kumar, Advocate, Ld. counsel for applicant/defendant and Sh. Aditya -6- Madan, Advocate, Ld. counsel for non-
applicant/plaintiff and carefully perused the record. I have given my considerable thought to the submissions put forth by Ld. counsel for parties. I have also carefully perused the record.
10. Sh. Suraj Kumar, Advocate, Ld. counsel for applicant/defendant has submitted that summons were received without annexures. There was no proper service. The court does not have territorial jurisdiction. The suit is barred because of Money Lenders Act. In reply to this plea the plaintiff for the first time has mentioned about friendly loan. Even mode of payment has not been disclosed. He has further submitted that an application under Order VII R-11(d) Code of Civil Procedure has been moved as the suit is not maintainable under Section 3 of the Punjab Money Lenders Act. In rebuttal he has further submitted that plaintiff has nowhere mentioned what work and nature of work he is carrying on. Plaintiff has advanced loan for business but purpose has not been disclosed. If it was -7- friendly loan for what purpose it was given.
11. Sh. Aditya Madan, Advocate, Ld. counsel for non-applicant/plaintiff has submitted that Order XXXVII Rule 3 Code of Civil Procedure talks about copy of plaint and annexures. He has submitted that there was no annexure with the plaint. Plaintiff was not supposed to supply documents, therefore, the defendant should have inspected the judicial file. He has also referred to list of documents filed by the plaintiff wherein two affidavits regarding receipt of payment have been mentioned. He has submitted that leave to defend application is absolutely silent about these two affidavits. He has further submitted that suit is based on cheques i.e. negotiable instrument and under the Negotiable Instruments Act there is presumption that every negotiable instrument be presumed to be for consideration unless rebutted otherwise. He has further submitted that both the cheques have been returned for insufficient funds. Even para 3 of the plaint mentions regarding cordial relations. He has further submitted -8- that, therefore, plaintiff is not a money lender. There is no interest charged by the plaintiff. It was only friendly loan without interest, hence, it is not covered under Section 2(9) of the Punjab Moneylender Act, therefore, the suit is not barred under Section 3 of this Act.
12. The applicant/defendant has submitted in leave to defend application that summons of the suit were received by the defendant without any document or annexure, therefore, there was no proper service under Order XXXVII Code of Civil Procedure. Even summons of judgment have been received without any document or annexure on 09/04/2004. It has been submitted that the suit is not maintainable. Defendant is not liable to pay the alleged amount. The suit is barred by territorial jurisdiction. The defendant resides at Faridabad. The cheques are drawn at the bank located in Faridabad. There was no transaction between the parties in Delhi. Suit is also barred under Section 3 of the Punjab Registration of Money Lenders Act, 1938. As per this Act a lender who is not registered -9- cannot lend money to anybody. Defendant has never received the alleged payment of Rs.15,00,000/- from the plaintiff. The plaintiff has not specified the mode of payment as to how the money was transferred/handed over to the defendant on 17/10/2003. The Suit has been filed with malafide intention to pressurize the defendant for extortion of money. No prima facie case is made out and the relief does not fall within the ambit of provision of Order XXXVII of Code of Civil Procedure. The Defendant has substantial defence and the matter raises triable issue.
13. Non-applicant/plaintiff has filed reply to leave to defend application contesting the application inter-alia on the grounds that plaintiff has not annexed any annexure to the plaint, therefore, there was no occasion for supply of annexures. Plaintiff has also denied that there was no proper service upon the defendant of the suit. It has further been submitted that the loan was advanced by the plaintiff to defendant at Delhi. It was repayable at Delhi. The cheques in -10- question were presented for encashment at Delhi. These cheques were returned unpaid to the plaintiff at Delhi, therefore, the court has territorial jurisdiction. It has further been submitted that the loan advanced by the plaintiff was friendly loan and on account of long standing cordial relations between the parties, thus, the loan advanced by the plaintiff to defendant is not within the meaning of Section 2(7) of the Punjab Registration of the Money Lender Act, 1938 and plaintiff is not a moneylender within the meaning of Section 2(9) of this Act. Therefore, the objection regarding Punjab Registration of Money Lender Act is totally misplaced. It has further been submitted that defendant himself has deposed in his affidavit dated 17/10/2003 and had confirmed about payment of Rs.15,00,000/- and the same was being returned through two cheques in question. Defendant is totally raising untenable plea with a view to frustrate the liquidation of his admitted dues.
14. Applicant/defendant filed rejoinder to this -11- leave to defend application reaffirming and reasserting the averments made in the application. The defendant has denied taking any loan.
15. It is pertinent to mention that defendant kept silent about execution of two affidavits dated 17/10/2003 wherein defendant had confirmed about receiving of Rs.15,00,000/- and return of this amount by two cheques i.e cheque in sum of Rs. Four Lakh dated 01/11/2003 and cheque in sum of Rs. Eleven Lakh dated 30/11/2003. Regarding reply of plaintiff to the plea of territorial jurisdiction applicant/defendant remained silent about the case of plaintiff that loan was advanced at Delhi. It was repayable at Delhi. Cheques were presented for encashment at Delhi and these were returned unpaid to the plaintiff at Delhi. There is no specific denial to this effect.
16. An application under Order VII R-11(d) read with Sec.151 Code of Civil Procedure was also moved by applicant/defendant wherein objection was raised -12- that in view of Section 3 of Punjab Registration of Money Lender Act, 1938, no money lender can file a suit and application unless money lender is registered and licenced. Any suit filed by the money lender is barred unless and until reopening license or he is registered moneylender. Plaintiff is neither registered money lender nor he has obtained any licence for the same, therefore, plaintiff is not entitled to lend money to anybody. Plaint has to be rejected.
17. Plaintiff has contested this application, filed reply submitting that plaintiff has advanced friendly loan to the defendant on account of long standing cordial relations between the parties. The transaction is not covered by Section 3 of the Punjab Registration of Money Lender Act, 1938. The plaintiff is not money lender within Section 2(9) of this Act. For the applicability of this section there must be business of money lending. The word 'business' imports the notion of system, repetition and continuity, which is totally lacking in this case. An element of continuity and habit is, -13- therefore, essential to constitute the exercise of profession of business. Plaintiff is not carrying on business of moneylending, therefore, Punjab Registration Moneylender Act, 1938 is not applicable to the transaction between the parties. The applicant/defendant has filed rejoinder to this application reaffirming and reasserting the averments made in the application and denying the case of the plaintiff.
18. From the perusal of record it is clear that even though in the plaint plaintiff has mentioned regarding issuance of cheque no.370103 dated 01/11/2003 for Rs. 4,00,000/- and the second cheque no.370104 dated 30/11/2003 for Rs.11,00,000/- but nowhere applicant/defendant has denied issuance of these cheques. In para 3 of the plaint plaintiff has averred regarding long standing cordial relations between the parties and request of defendant for deferring the presentation of first cheque. There is no such specific denial in this respect on behalf of -14- applicant/defendant. Even for further request of defendant on 30/11/2003 for presentation of two cheques there is no denial. Defendant also remained silent regarding return of cheques with endorsement dated 10/12/2003 to the effect insufficient funds. The defendant also remained silent despite specific averment in the plaint especially para 16 for execution of two affidavits to the effect that these cheques would not be dishonoured. The receipt of payment of Rs.15,00,000/- has been denied but there is no explanation for issuance of two cheques in question which have been returned with the endorsement dated 10/12/2003 for ''insufficientfunds''.Regarding plea of applicant/defendant that mode of transfer of money has not been disclosed and defendant has never received payment of Rs.15 Lakhs it is clear that since it is case based on two cheques issued for Rs. Four Lakhs and Rs. Eleven Lakhs, the provisions of Section 118 of Negotiable Instruments Act, 1881 regarding presumption are clear. Issuance of these cheques are not denied which implies that these cheques were -15- issued for consideration. It is not rebutted by the defendant.
19. The objection regarding Section 3 of Punjab Registration of Moneylender Act has been raised for the sake of raising objection. The plaintiff'sstand is having force in this respect when it states that the business imports the notion of the system, repetition and continuity. There is no such repetition and continuity in the instant case. There is no denial to the effect that they did not had long standing cordial relations. There is nothing regarding claim of interest on the loan amount of Rs.15,00,000/-. For Rs.15,00,000/- two cheques of Rs.4 Lakhs and Rs.11 Lakh were issued by the defendant. Even the affidavit dated 17/10/2003 mentions the same. Defendant remained silent about execution of affidavits. There is no denial to the effect that these cheques have not been issued by the defendant and these cheques on presentation have been returned with endorsement dated 10/12/2003 insufficient funds. Regarding proper service and non supply of annexures -16- the argument of Ld. counsel for plaintiff has force as none of such document is annexure or part of the plaint. Therefore, in my considered view there is proper service.
20. In view of abovesaid discussion, I am of the considered view that there was proper service. The court has territorial jurisdiction. The cheques have been issued by the defendant which have been returned with endorsement dated 10/12/2003 insufficient funds. The case is not covered u/s 3 of Punjab Registration of Moneylender Act. No triable issue is raised by the applicant/defendant which entitle him for grant of leave to defend. The application for leave to defend is devoid of merits, hence, dismissed.
21. Regarding application under Order VII R- 11(d) Code of Civil Procedure as has already been discussed while deciding leave to defend application, the case is not covered under Section 3 of the Punjab Registration of Moneylender Act, 1938. This application -17- is also not maintainable, hence, dismissed.
22. Since, it was friendly loan and plaintiff has claimed interest @12% p.a., I am of the considered view that keeping in view that loan was advanced on 17/10/2003 and it was a friendly loan, the sum of Rs. Four Lakh was to be paid by 01/11/2003 and Rs.Eleven Lakh was to be paid by 30/11/2003 and which has not been paid despite issuance of legal notice dated 24/12/2003, the simple interest @9% p.a. is reasonable interest. Accordingly, the suit is decreed for sum of Rs.15,00,000/- with simple interest @9% per annum w.e.f. 01/12/2003 till the date of realization. Since the leave to defend application is dismissed, the suit is decreed. Parties shall bear their own cost.
Decree-sheet be prepared accordingly. File be consigned to Record Room.
ANNOUNCED IN THE OPEN COURT
ON : 10th October, 2008 (PINKI)
Additional District Judge,
Delhi