Delhi District Court
Ms. Rita Sharma vs Sh. Lakhbir Singh Ladhar @ Sh. Lakhbir ... on 16 February, 2017
IN THE COURT OF HARJYOT SINGH BHALLA : ACJ/CCJ/ARC
(SE), SAKET COURTS, NEW DELHI.
CS No. 52328/16
1. Ms. Rita Sharma,
W/o Sh. Ram Kishan Sharma,
R/o A253 Sangam Vihar,
Near Girls Hostel, Opp. Batra Hospital,
New Delhi.
2. Sh. Suresh Kumar Malhotra,
S/o Late Sh. C. L. Malhotra,
R/o S305, Greater KailashI,
New Delhi 110048.
......... Plaintiffs
Versus
1. Sh. Lakhbir Singh Ladhar @ Sh. Lakhbir Singh Sandhu
R/o W138/13 Anupam Garden,
Saidula Jaib Extension, New Delhi - 110068.
2. Mrs. Nirmal Ladhar,
W/o Sh. Lakhbir Singh Ladhar,
R/o W138/13 Anupam Garden,
Saidula Jaib Extension, New Delhi - 110068.
3. Ms. Kickey,
D/o Shri Lakhbir Singh Ladhar,
R/o W138/13 Anupam Garden,
Saidula Jaib Extension, New Delhi - 110068 ....... Defendants
Suit instituted on : 02.07.2016
CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 1 of 9
Date of reserving Judgment: 09.01.2017
Judgment pronounced on : 16.02.2017
JUDGMENT
1. Arguments heard on the leave to defend application.
2. Briefly stated, it is the case of the plaintiff that plaintiff and defendant no. 2 and 3 are known to each other. Defendant no. 1 is the husband of defendant no. 2 and father of defendant no. 3. Defendant no. 2 and 3 had informed the plaintiff that defendant no. 1 was in need of some money and money was to be borrowed against post dated cheques to be issued by defendant no. 1 for repayment of the principal sum together with interest due thereupon on mutually agreed rates. The plaintiff no. 1 and 2 pooled their funds, major amount being contributed by plaintiff no. 1 on the ratio of nearly 3:1. Plaintiff no. 1 and 2 were not having any joint bank account and accordingly it was decided that the cheques towards repayment of principal amount and interest would be issued solely in the name of the plaintiff no. 1 and the plaintiffs will apportion the amount amongst themselves. Loan against these cheques were advanced from time to time by the plaintiffs to defendant no. 1 on the basis of undertaking by the defendants. Towards repayment and liability, various cheques were issued by defendant no. 1 from time to time. One of such cheque is the basis of present suit and bears cheque no.554389 dated 25.02.2016 in the sum of Rs.2,00,000/ drawn on PNB, Saket, New Delhi. The said cheque comprises of principal amount alongwith interest at mutually agreed rates up till 24.02.2016. Ultimately, the cheque was presented CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 2 of 9 for encashment on 23.05.2016. The said cheque was returned dishonored on 26.05.2016. It is stated that the present suit is based on a cheque and is well within ambit of Order 37 Rule 1 & 2 of CPC. Plaintiff has also prayed for interest @ 18% per annum from the date of dishonor of cheque in the present case.
3. The defendant entered appearance and applied for leave to defend. The defendant stated that the plaint does not disclose the amount of money that was given towards loan and when the cheques were handed over. There is no separate written agreement. It is stated that in the month of June 2014 plaintiff no. 1 had promised defendant no. 1 that she will arrange finance for the business of defendant no. 1. In June 2014, plaintiffs had as a surety, taken few cheques from the defendant no. 1 on the pretext that she has to show security to the other financers so that the money could be arranged. Two cheques of MKR Infratech were also taken to show him as a guarantor for the proposed loan. Defendant no. 1 refused to give blank cheques in the name of any other person and therefore cheques were issued only in the name of plaintiff no. 1.
4. It is averred that plaintiff no. 1 had promised that after the arrangement of advance towards loan, the cheques will be presented after about 6 months on monthly basis till the amount was cleared. However, the plaintiff no.1 failed to arrange any loan and it was agreed that said chapter stood closed in the month of November 2014. It is stated that the defendant asked the plaintiff to return the cheques, but the same were never returned. The defendant believed the plaintiff because of their old relations and did not CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 3 of 9 insist on the return of cheques when plaintiff had informed that she was unable to trace the cheques and therefore, the defendant took no action for return of cheques.
5. During the arguments Ld. Counsel for the defendant relied upon the provisions of Order 37. He urged that present suit was not maintainable as there was no liquidated specific sum mentioned in the plaint which could be claimed under Order 37 of CPC. He specifically relied upon Order 37 Rule 1 (2) (b) of CPC towards that plaintiff was bound to plead what the amount of loan and when was it extended.
6. I have gone through the provisions of Order 37 Rule 1 of CPC and the relevant portion is being reproduced:
"Order 37 Rule 1. Courts and classes of suits to which the Order is to apply. (1)......
(2) Subject to the provisions of subrule (1), the Order applies to the following classes of suits, namely:
(a) suits upon bills of exchange, hundies and promissory notes;
(b) suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising,
(i) on a written contract; or
(ii) on an enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or
(iii) on a guarantee, where the claim against the principal is in respect of a debt or liquidated demand only.
(iv) suit for recovery of receivables instituted by any assignee of a receivable." (Emphasis supplied)
7. There is a fine distinction between the two clauses of Order 37 CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 4 of 9 Rule 1 (2) of CPC i.e. Order 37 Rule 1 (2) (a) and Order 37 Rule 1 (2) (b) which have been quoted hereinabove. Clause (2) (a) does not qualify the expression bills of exchange, hundies and promissory notes with anything else. There is no requirement of existence of a separate liquidated demand in money as in case of clause (2) (b). It is a fundamental rule of statutory interpretation that each clause has to be read independently and sub clauses of a separate clause cannot be read into any preceding or subsequent clause. It seems clear that where a suit is based upon bills of exchange, hundies and promissory notes, legislature requires no further inquiry. Perhaps this is to preserve the sanctity of Negotiable Instruments for which there is a presumption of existence of consideration. Even otherwise, Negotiable Instruments can be negotiated and passed on from one party to another and the drawer thereof remains bound to honor the same. The demand for liquidated money on a contact is dealt with by clause (2) (b) reproduced hereinabove and may stand on a different footing but I am not concerned with the same. Plaintiff can file a suit on a bill of exchange, hundies and promissory notes demanding the amount mentioned in the bill, hundies or note respectively. It would for the defendant to show that the same was without consideration. A cheque is a bill of exchange as per Section 6 of Negotiable Instruments Act and is clearly covered by Order 37 Rule 1 (2) (a) of CPC.
8. What has to be seen at this stage is whether the defendant has a bonafide defence or a sham defence. The defendant has set up a claim that cheques were given as a security in the year 2014 for arranging of finance but CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 5 of 9 finance was never arranged and cheques were also never returned. The cheque in question is claimed by the defendant to be one out of the said cheques which had to be returned but was never returned. Defendant has admitted that the name of the beneficiary and the amount etc. were filled by the defendant no. 1 himself.
9. What is the worth of the stand of the defendant?
Firstly, defendant has not placed on record even a single document whereby he demanded the return of his so called security cheques (including the cheque in question) from the plaintiff for the period November 2014 up till the filing of suit i.e. 02.07.2016. which is almost 2 years.
Secondly, a perusal of reasons for dishonor mentioned in the dishonor memo dated 24.05.2016 is "funds insufficient" and not payment stopped by drawer. It is not even the case of the defendant that he had at any point of time issued stop payment instructions to the bank on being informed that the cheques had been lost as anyone would have done on being informed that the cheques had been misplaced. This is contrary to ordinary course of human action and what a prudent person would have done.
Thirdly, a heavy onus was on the shoulders of the defendant to show, at least, prima facie, that he had taken some steps/stand with regard to the cheques being security or the return of the same. At least, a letter ought to have been sent at the earliest to the plaintiff or the banker and same should have been placed on record. The presumption under Section 114 of the Indian Evidence Act has not even been prima facie rebutted and the defence seems to be sham or an afterthought.
CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 6 of 9Fourthly, it is settled law that objections/demand for return of security cheques or defences like signed blank documents were given must be taken at the earliest and in the present case there should have been a demand as far back as in November 2014, if what the defendant is saying was correct. Reliance is placed upon the decision in Punjab & Sind Bank Vs. M/s Ram Prakash Jagdish Chander, 40 (1990) DLT 497 ; Indian Bank VS. Cheese Wafers (India) Pvt. Ltd., 76 (1998) DLT 892.
10. In Punjab & Sind Bank (supra) it was observed and I quote:
The defense that the defendant's signatures were obtained on blank proformas is not only untrustworthy but also does not raise any friable issue. Under Section 20 of the Negotiable Instruments Act, 1881, it is provided that when a person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments either wholly blank or having written thereon an incomplete instrument he gives prima facie authority to the holder of such an Installment to complete upon it a negotiable instrument for any amount which may be covered by the stamp affixed on it. The person so signing is made liable upon such an instrument in the capacity in which he signed it to any holder in due course. The defendants did not raise their little finger to point out if their signatures were obtained on any blank documents by the then Manager of the plaintiff bank. The present suit was filed in 1984. Till then the defendants chose to keep silent about their signatures having been obtained on blank documents: The only irritable conclusion, therefore, is that the plea now sought CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 7 of 9 to be raised by the defendants to the effect that their signatures were obtained on blank documents is merely a sham plea, devoid of any force and as such cannot be deemed to raise any friable issue. Therefore, simply because no documents were got executed by the plaintiff bank from the defendants in 1979 will not give rise to a presumption that even in 1982 that initial mistake was not rectified by the bank authorities when they purchased two cheques from the defendants for being credited in the bills discounting facility and also got executed the demand promissory note and other documents in the cash credit account facility. Therefore, I do not see any merit in this defense raised by the defendants.
11. Similar view was taken by the Delhi High Court in Indian Bank (supra) and I quote:
Defendants did not raise even a whisper after signing this letter of acknowledgement of liability, therefore, now to contend that the documents signed by the defendants were blank, which were subsequently filled up, is only an afterthought to cover their acknowledgement which they have made in the year 1992. Why the defendants chose to keep silent about their signatures having been obtained on blank documents. This plea was taken at the time of filing of the application for leave to defend not earlier at any stage. Conclusion, therefore, is that plea now sought to be raised by the defendants to the effect that the signatures were obtained on blank documents, is merely a sham plea and devoid of any force.
12. There is not much of a difference in giving signed blank documents or CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 8 of 9 documents complete in all respect and signed but not to be acted upon and plea that they are not to be acted upon has to be taken at the earliest. Reliance is also placed on well settled legal maxim that the law comes to the aid of the vigilant and not the dormant i.e. vigilantibus et non dormientibus jura subveniunt.
13. Therefore, in my view, the defendant raised absolutely a sham defence. The defendant has no support in law or on facts and therefore, the present suit is liable to be decreed and leave to defend application of the defendant is liable to be dismissed.
14. Suit of the plaintiff is decreed against defendant no.1 for Rs.2,00,000/ alongwith costs and future interest from date of decree till payment @ 9% per annum.
15. Decree sheet be prepared accordingly. File be consigned to Record Room.
Announced in the open Court (Harjyot Singh Bhalla)
dated 16.02.2017 ACJ/CCJ/ARC/ SouthEast,
Saket Court Complex, New Delhi.
CS. No.52328 /16 Rita Sharma & Ors Vs Lakhbir Singh & Ors Page 9 of 9