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M/S Shri Colonizers & Developers Pvt Ltd vs M/S Felicia Realcon India Pvt Ltd on 14 November, 2019 cites

Idbi Trusteeship Services Ltd vs Hubtown Ltd on 15 November, 2016

16. While there is no quarrel to the proposition of law laid down in the case of IDBI Trusteeship Services Limited (supra), the important aspect is that the application for leave to defend must raise triable issues. The application should be bona fide. The defence should not be frivolous, sham, moonshine, vague or simply with a view to prolong the litigation to prevent the plaintiff from an early decree. The Apex Court has repeatedly held that untenable and frivolous defence should be rejected and a speedy decision should be rendered in the interest of trade and commerce. In our view, the learned Single Judge has rightly held that the appellant has failed to raise any plausible defence or any triable issue, which would entitle him to an unconditional leave to defend. The appellants received a sum of Rs.3 crores and in return three post-dated cheques, duly signed by one of the directors of the appellant, were issued no.2. The same were deposited and were returned with the endorsement 'insufficient funds'. In case there was any merit in the defence sought to be raised today, the appellant would have, at first opportunity available, either stopped the payment of the post-dated cheques which were issued or at least replied to the legal notices and placed their objection and defence on record. The failure of the appellant to reply to the notices issued by the respondent clearly makes their defence sham, frivolous, untenable and moonshine.
Supreme Court of India Cites 18 - Cited by 430 - R F Nariman - Full Document

Santosh Kumar vs Bhai Mool Singh on 5 February, 1958

"Learned counsel relied upon a decision of this court in Santosh Kumar v. Bhai Mool Singh [ (1958) SCR 1211] and particularly upon a passage at p. 1216. That was a case in which the Court of Commercial Subordinate Judge, Delhi, had held that the defence raised a triable issue but that defence was vague and was not bona fide because the defendant had produced no evidence to prove his assertion. For these reasons the court granted leave to defend the suit on the condition of the defendant giving security for the entire claim in the suit and costs thereon. This court held that the test is to see whether the defence 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 defence on those facts. If the court is satisfied about that, leave must be given unconditionally. This Court further held that the trial court was wrong in imposing a condition about FAO (OS) (Comm) 207/2018 Page 6 of 17 giving security on the ground that documentary evidence had not been adduced by the defendant. This Court pointed out that the stage of proof can only arise after leave to defend has been granted and that the omission to adduce documentary evidence would not justify the inference the defence sought to be raised was vague and not bona fide. While dealing with the matter Bose, J., who spoke for the Court observed (p. 1216):
Supreme Court of India Cites 8 - Cited by 409 - A K Sarkar - Full Document

Rawalpindi Theatres Private Ltd. vs Film Group on 4 July, 1958

I should be prepared to accept that there has been a tendency in the last few years to use this condition more often than it has been used in the past, and I think that that is a good tendency;" These observations as well as some observations of Chagla, C.J., in Rawalpindi Theatres Private Ltd. v. Film Group Bombay [ (1958) BLR 1373 at p 1374] may well be borne in mind by the court sitting in appeal FAO (OS) (Comm) 207/2018 Page 9 of 17 upon the order of the trial Judge granting conditional leave to defend. It is indeed not easy to say in many cases whether the defence is a genuine one or not and therefore it should be left to the discretion of the trial Judge who has experience of such matters both at the bar and the bench to form his own tentative conclusion about the quality or nature of the defence and determine the conditions upon which leave to defend may be granted. If the Judge is of opinion that the case raises a triable issue, then leave should ordinarily be granted unconditionally. On the other hand, if he is of opinion that the defence raised is frivolous, or false, or sham, he should refuse leave to defend altogether. Unfortunately, however, the majority of cases cannot be dealt with in a clear cut way like this and the judge may entertain a genuine doubt on the question as to whether the defence is genuine or sham or in other words whether it raises a triable issue or not. It is to meet such cases that the amendment to Order 37 Rule 2 made by the Bombay High Court contemplates that even in cases where an apparently triable issue is raised the Judge may impose conditions in granting leave to defend. Thus this is a matter in the discretion of the trial Judge and in dealing with it, he ought to exercise his discretion judiciously. Care must be taken to see that the object of the rule to assist the expeditious disposal of commercial causes to which the Order applies, is not defeated. Care must also be taken to see that real and genuine triable issues are not shut out by unduly severe orders as to deposit. In a matter of this kind, it would be undesirable and inexpedient to lay down any rule of general application."
Bombay High Court Cites 1 - Cited by 5 - Full Document
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