Delhi District Court
Harish Kumar vs M/S New J.K. Fruits on 23 August, 2022
Harish Kumar V. M/s New J.K. Fruits and Ors.
IN THE COURT OF SH. VIRENDER BHAT
LD. DISTRICT JUDGE (COMMERCIAL COURT),
NORTH DISTRICT, ROHINI COURTS: DELHI.
CS (Comm.) No. 422/2019
Harish Kumar
Proprietor, M/s Nav Jyot Fruit Traders,
Office at B-180, New Subzi Mandi,
Azadpur, Delhi-110033.
...... Plaintiff
VERSUS
1. M/s New J.K. Fruits
C-116, New Subzi Mandi,
Delhi-110033.
(Through partners)
2. Shri Tulsi Das
S/o Sh. Ganga Ram
R/o B-1/10, Ganpati Apartments,
Opposite Oberoi Maidins, Sham Nath Marg,
Civil Lines, Delhi-54.
3. Shri Deepak Kumar
S/o Sh. Manohar Lal
4. Shri Manohar Lal
S/o Sh. Ganga Ram
Both R/o D-12, Polo Road,
Kalyan Vihar,
New Delhi-19.
........ Defendants
CS (Comm.) No. 422/2019 Page No . 1 of 11
Harish Kumar V. M/s New J.K. Fruits and Ors.
Date of Institution : 20.11.2019
Date of final arguments : 16.08.2022
Date of decision : 23.08.2022
J U D G E M E N T:-
1. By this order, I proposed to decide the application of the defendants u/o XXXVII Rule 3(5) CPC for leave-to-defend the suit.
2. The plaintiff has filed the instant suit for recovery of Rs. 4,35,870/-
along with interest against the defendants on the basis of two promissory notes issued by defendant no. 2 for himself as well as on behalf of defendant no. 1,3 and 4 in favour of the plaintiff.
3. It is averred in the plaint that the defendant no. 2 representing himself as partner of defendant no. 1, approached the plaintiff for purchase of fruits on credit basis and accordingly, purchased fruits worth Rs. 4,26,850/-. It is further stated that the defendant paid only a sum of Rs. 26,850/- to the plaintiff in cash with the assurance to pay the balance amount of Rs. 4 Lakhs later on, along with the interest @ 12% per annum.. It is stated that the defendant no. 2 for himself as well as on behalf of defendant no. 1,3 and 4 executed two demand promissory notes dated 31.12.2018 and 05.02.2019 in the amount of Rs. 2 Lakhs each in favour of the plaintiff.
4. The plaintiff further contends that when he approached the defendants on 30.06.2019 demanding the balance amount of Rs. 4 Lakhs, they again extended the assurance to pay the said amount within 15 days but this time also, the assurance was not fulfilled. Accordingly, the plaintiff got served a legal notice dated 26.07.2019 upon them through speed post but the defendant neither tendered any reply in the said legal notice nor paid the above noted CS (Comm.) No. 422/2019 Page No . 2 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
outstanding amount.
5. Thus, the plaintiff is claiming the said sum of Rs. 4 Lakhs along with the interest amount of Rs. 35,870/- upto the date of filing of the suit @ 12% per annum (Total Rs. 4,35,870).
6. Ld. counsel for the defendant/applicant submitted that the suit is bad for non-joinder of necessary parties. It is his submission that the plaintiff is having knowledge that Sh. Riyaz Ahmad Thokar is also a partner of defendant no. 1 firm apart from defendant numbers 2,3 and 4 but he did not array him as a defendant in the suit malafidely and, therefore, the suit is liable to be dismissed on this score only. He would further submit that in fact, this suit has been filed by the plaintiff in collusion with said Sh. Riyaz Ahmad Thokar by misusing the two promissory notes in question. He argued that in fact no such promissory notes were ever executed by the defendants in favour of the plaintiff as there had not been any business relations between them at any point of time. According to the Ld. Counsel, the two promissory notes have been filled up by the plaintiff himself or by any other person known to him. He submitted that signed promissory notes/cheques used to be kept in the office of defendant no. 1 firm for the purpose of carrying out daily business transactions and certain signed promissory notes/cheques also used to be carried by defendant no. 4 for business purposes. It is further submitted that a handbag containing signed blank promissory notes/cheques was lost by defendant no. 4 in the month of May, 2019 and intimation in this respect was duly given to the police and NCR/LR No. 1088638/2019 was registered in this regard in PS Crime Branch, Delhi on 28.05.2019. It was CS (Comm.) No. 422/2019 Page No . 3 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
argued by Ld. Counsel that the said handbag appears to have been found or stolen by the plaintiff after which he has filled up the two promissory notes in question and has misused the same in filing the instant suit. It is the submission of Ld. Counsel that the defendants have a good defence to the suit and have raised triable issues which can be effectively decided only after the formal trial of the case. He urged this court to grant leave-to-defend the suit to the defendants.
7. On the other hand, Ld. Counsel for the plaintiff argued that the defendants are not entitled to leave-to-contest the suit for the reason that the contentions raised by them in the application are totally bogus and concocted. He argued that in case the contentions of the defendants that the defendant no. 4 had lost the bag containing signed blank promissory notes/cheques in May, 2019 had been true, they would have given intimation to their bank requesting to stop the payment of lost signed cheques and also would have notified the general public about lost/theft of the signed promissory notes by way of a publication in any of the newspapers. He submitted that since no such action has been taken by the defendants, their contentions in this regard patently appear to be fabricated and imaginary. He further argued that the contentions of the defendant that the plaintiff appears to have found/stolen the bag in question lost by defendant no. 4 also is not believable for the reason that no criminal complaint in this regard has been lodged against the plaintiff even after receipt of summons of this suit. According to Ld. Counsel, the defendants have fabricated a false story only with an intention to delay the proceedings of this case and to deprive the plaintiff from his legal entitlements. It is his submission that there CS (Comm.) No. 422/2019 Page No . 4 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
are no cogent grounds for granting leave-to-contest the suit to the defendants and, therefore, the application deserves dismissal.
8. I have considered the rival submissions of both the Ld. Counsels and have perused the entire material on record.
9. The basic judgment laying down the principles of dealing with the application for leave-to-defend delivered by the Hon'ble Supreme Court is M/s Mechalec Engineers and Manufactures Vs. M/s Basic Equipment Corporation , AIR 1977 Supreme Court 577. In para 8, the Hon'ble Supreme Court has held as follows:-
"In Smt. Kiranmoyee Dassi Vs. Dr. J. Chaterjee, (19545) 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 CPC 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 has a defence, yet CS (Comm.) No. 422/2019 Page No . 5 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
shows 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 illusry or sham or practically moonshine then ordinarily the plaintiffs 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 illusry 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."
10.From the law laid down by the Hon'ble Supreme Court it can be discerned that while deciding application for grant of leave to defend under Order XXXVII Rule 3(5) of CPC, the court is required to see as to whether the facts brought to the notice by the defendant by way of affidavit or otherwise, are sufficient to entitle CS (Comm.) No. 422/2019 Page No . 6 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
him to defend the suit. If the defendant is able to satisfy the court that he has a good defence on merits then the plaintiff is not entitled to leave to sign the judgment and an unconditional leave-to-defend can be granted to the defendant. Where the defendant raises a triable issue indicating that he has a fair, bona fide or reasonable defence although not a positive good defence, the defendant can still be granted unconditional leave to defend. However, where the defendant has no defence or defence set up is illusory, sham and practically a moonshine, the plaintiff would be entitled to leave to sign the Judgment and leave to defend can be refused to the defendant.
11.In the instant case, the contentions of the defendants with regards to Sh. Riyaz Ahmad Thokar as one of the partners of defendant no. 1 firm and his deliberate non-impleadment as a defendant in this suit by the plaintiff appear to be self contradictory. On one hand, it is claimed by the defendants that the plaintiff was having complete knowledge about the fact that Sh. Riyaz Ahmad Thokar is also one of the partners of defendant no. 1 firm whereas on the other hand, it is stated by them that they and the plaintiff are not known to each other at all and did not have any business relations at any point of time. When, as per the statement of defendants themselves in the application for leave-to-defend, they were not known to the plaintiff, it is not understandable as to how they impute knowledge to the plaintiff that the defendant no. 1 firm was having four partners including Sh. Riyaz Ahmad Thokar. Further on one hand, the defendants contend that Sh. Riyaz Ahmad Thokar should have been arrayed as a defendant in this suit whereas on the other hand, it CS (Comm.) No. 422/2019 Page No . 7 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
is claimed by them that the plaintiff has filed the suit in collusion with said Sh. Riyaz Ahmad Thokar by misusing the promissory notes in question. If in fact, that is the case, the defendants cannot claim that Sh. Riyaz Ahmad Thokar should have been impleaded as a defendant in this suit.
12.Perusal of the averments made in the plaint nowhere indicate that the defendant no. 2, 3 and 4, who are stated to have approached the plaintiff for purchase of fruits on behalf of defendant no. 1, had disclosed to the plaintiff about fourth partner, namely, Sh. Riyaz Ahmad Thokar also. It appears that in the absence of any such intimation given to the plaintiff, he has proceeded with the assumption that defendant no. 2, 3 and 4 are the only three partners of defendant no. 1 firm and entered into transactions with them and accordingly filed the instant suit against them. It is nowhere in the case of the defendant no. 2, 3 and 4 that they supplied the copy of the partnership deed to the plaintiff.
13.In view of these facts and circumstances, the suit cannot be held to be bad for non-joinder of Sh. Riyaz Ahmad Thokar is the defendant in this case.
14.The defendants claim that they had never entered into any business transactions with the plaintiff and the plaintiff has filed a false and frivolous suit on the strength of stolen/lost promissory notes which he has himself filled up. It is not disputed that the two promissory notes in question bear the genuine signatures of defendant no. 2 Tulsi Das. It is contended that a bag containing signed blank cheques and signed blank promissory notes was lost by defendant no. 4 in the month of May, 2019 which may have been found/stolen CS (Comm.) No. 422/2019 Page No . 8 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
by the plaintiff and upon filling up the two promissory notes, has misused the same by filing the instant suit. It is a normal practice that a person, whose signed cheques/instruments are lost or misplaced, immediately informs his banker about the same so as to stop the misuse of the cheques. He is also expected to get a notice published in this regard in a newspaper in order to stop misuse of the signed blank promissory notes. Admittedly, the defendants neither intimated their banker about the lost/misplacement of the signed blank cheques nor issued any notice in any newspaper to inform the general public about the loss/misplacement of the signed blank promissory notes. Further, if the defendants were of the impression that the bag lost by defendant no. 4 was found/stolen by the plaintiff, they were also expected to lodge FIR against him for the theft of promissory notes and for committing forgery upon those promissory notes by filling up those in his own name. That also has not been done by the defendants.
15.It is intriguing as to why the defendant no. 4 was roaming around with a bag containing signed blank cheques and signed blank promissory notes. The defendants have tried to explain that defendant no. 4 used to do so for business purposes. The nature and extent of the business of the defendants which may require carrying of signed blank negotiable instruments on daily basis has nowhere been explained in the entire application. It is very difficult to believe that a person would carry blank signed negotiable instruments in today's age also when there are several modes of transfer of money apart from cheques and promissory notes.
16.It may also be noted here that in case it is presumed that the bag CS (Comm.) No. 422/2019 Page No . 9 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
containing signed negotiable instruments was lost by defendant no. 4, it cannot be believed, being highly unlikely and improbable, that the same would have been found by the plaintiff.
17.There is one more aspect which needs to be noted. Before filing the suit, the plaintiff has sent a legal notice dated 26.07.2019 to the defendants calling upon them to pay the sum of Rs. 4 Lakhs along with interest. It was sent to all the four defendants separately. Original postal receipts as well as the printouts of the tracking report has been filed along with the plaint. Perusal of the postal receipts reveals that the notice was sent separately to all the four defendants. Perusal of the tracking reports reveals that the registry envelope containing the notice was delivered to all the four addressees i.e. all the four defendants. Therefore, it shall be deemed that the legal notice was duly served upon all the defendants. None of the defendants has bothered to send reply to the plaintiff to the said notice. In case the contentions raised by the defendants in the application under disposal were true, they would have immediately sent reply to the said legal notice of the plaintiff denying their liability towards the plaintiff on the grounds as stated in the application. The defendants would not have permitted to go out of hand this first possible opportunity to deny their liability towards the plaintiff. Such conduct of the defendants, undoubtedly indicates that the pleas taken by them in the instant application are totally concocted and fabricated.
18.In view of the above discussion, the defence raised by the defendants by way of instant application appears to be absolutely concocted, sham and not inspiring the confidence of the court at all.
CS (Comm.) No. 422/2019 Page No . 10 of 11 Harish Kumar V. M/s New J.K. Fruits and Ors.
It is manifest that the defendants have not raised any triable issue entitling them to leave-to-contest the suit.
19.Hence, no merit is found in the application. Same is hereby dismissed.
(VIRENDER BHAT)
District Judge (Commercial Court)
North:Rohini:Delhi/23.08.2022
CS (Comm.) No. 422/2019 Page No . 11 of 11