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Delhi High CourtIndian Cases

Sh. Vipin Gupta vs Sh. Prem Singh on 28 August 2006

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Delhi High Court
Sh. Vipin Gupta vs Sh. Prem Singh on 28 August, 2006
Equivalent citations: AIR 2007 (NOC) 470 (DEL.)
Author: S.L. Bhayana
Bench: T.S. Thakur, S.L. Bhayana
JUDGMENT

S.L. Bhayana, J.

1. This is an appeal arising out of the order of the learned Additional District and Sessions Judge, Delhi dated 29.10.2005 wherein the learned Trial Court has dismissed the application of the appellant for leave to defend the suit and has decreed the suit of the respondent/plaintiff. The brief facts of the case are that the plaintiff/respondent filed a suit for recovery of Rs. 3,88,000/- under the provisions of Section 37 of the Code of Civil Procedure. The plaintiff has alleged that the appellant/defendant had taken a friendly loan from the plaintiff in the sum of Rs. 3,00,000/- on 13.08.2002. The plaintiff had given a sum of Rs. 3,00,000/- in cash and the defendant executed and signed the receipt for the same. The defendant also gave an undertaking that he will return the said loan within a period of ten months w.e.f. 13.08.2002. The appellant/defendant also issued two post dated cheques bearing Nos. 138230 and 144075 for Rs. 1,50,000/- each. Both the cheques were dated 13.06.2003. These cheques were drawn on State Bank of Hyderabad, Vikas Marg, Delhi in favor of the plaintiff. On 13.06.2003, the plaintiff presented these cheques with the bank for encashment but the said cheques were returned back unpaid with the remarks “Account Closed”. The plaintiff sent a legal notice under Section 138 of the Negotiable Instrument Act dated 19.07.2003 demanding the aforesaid amount from the appellant/defendant but despite service of the said legal notice, defendant did not make any payment to the plaintiff. The plaintiff thereupon filed a criminal complaint under Section 138 of the Negotiable Instrument Act against the defendant which is pending in Karkardooma Courts. The plaintiff again served the legal notice dated 06.10.2004 on the defendant calling upon the defendant to make payment of Rs. 3,70,000/- which included Rs. 3,00,000/- as principle amount and Rs. 70,000/- as interest. The legal notice was duly served upon the defendant but the defendant did not make any payment to the plaintiff. Thereafter, the plaintiff filed a suit for recovery of Rs. 3,88,000/- against the defendant Along with interest @ 18% per annum.

2. The defendant was served with summons of the suit filed under Order 37 of the Code of Civil Procedure. The defendant put in his appearance before the Court. The defendant also filed an application for leave to defend the suit. The application for leave to defend the suit filed by the defendant has been dismissed by the learned Trial Court and the suit of the plaintiff has been decreed.

3. We have heard arguments advanced by learned Counsel for both the parties and have perused the record carefully. The counsel for the appellant has stated that the blank signed cheques in question were lost from the custody of the appellant. Thereafter, he lodged the complaint with the police. He also gave information to the bank about the cheques having been lost. He has further stated that the cheques appeared to have been stolen by the respondent/plaintiff and have been used for filing the present suit for recovery against the appellant. He has further stated that the cheques in question on the basis of which the suit has been filed by the respondent/plaintiff are without any consideration. Learned Trial Court has not applied its mind and wrongly dismissed the application of the appellant for leave to defend the suit. The counsel for the appellant has prayed that the impugned order may be set aside and the appellant be granted permission for leave to defend the suit. On the other hand, learned Counsel for the respondent/plaintiff has submitted that the appellant and the respondent/plaintiff are known to each other for a long time. He has further stated that the appellant took a friendly loan of Rs. 3,00,000/- in cash from the respondent/plaintiff and he executed and signed receipt for having received the sum of Rs. 3,00,000/- in cash. The appellant also wrote an undertaking that the said loan would be returned back within a period of ten months w.e.f. 13.08.2002. He has further stated that the appellant has put up a false story that he had lost these two cheques and these two cheques have been stolen by the respondent/plaintiff and he has filed a false suit against him. He has further stated that despite legal notice having been served upon the appellant, he has failed to pay back the amount of Rs. 3,00,000/- given as loan by the plaintiff/respondent. He has further stated that the learned Trial Court has rightly dismissed the application of the appellant for leave to defend the suit.

4. We have perused the record. The present suit has been filed by the respondent/plaintiff under Order 37 of the Code of Civil Procedure. The present suit is based on two cheques in the sum of Rs. 1,50,000/- each dated 13.06.2003 and both these cheques are drawn at State Bank of Hyderabad, Vikas Marg, Delhi in favor of the plaintiff. Both these cheques were presented by the plaintiff to his bankers i.e. Syndicate Bank, Nirman Vihar, Delhi for encashment but the said cheques were returned back unpaid with the remarks “Account Closed”. Legal notice was also served upon the appellant/defendant but despite service of legal notice, he has failed to pay back the amount advanced as loan by the plaintiff to the defendant. Summons of the suit filed under Order 37 of the Code of Civil Procedure were served upon the appellant who put his appearance before the Court and thereafter he moved an application for leave to defend the suit which has been dismissed by the learned Trial Court. Order 37 Rule 3 of the Code of Civil Procedure reads as under:

Procedure for the appearance of defendant – (1) In a suit to which this Order applies, the plaintiff shall, together with the summons under Rule 2, serve on the defendant a copy of the plaint and annexures thereto and the defendant may, at any time within ten days of such service, enter an appearance either in person or by pleader and, in either case, he shall file in Court an address for service of notices on him.
(2) Unless otherwise ordered, all summonses, notices and other judicial processes, required to be served on the defendant, shall be deemed to have been duly served on him if they are left at the address given by him for such service.
(3) On the day of entering the appearance, notice of such appearance shall be given by the defendant to the plaintiff’s pleader, or, if the plaintiff sues in person, to the plaintiff himself, either by notice delivered at or sent by a pre-paid letter directed to the address of the plaintiff’s pleader or of the plaintiff, as the case may be.
(4) If the defendant enters an appearance, the plaintiff shall thereafter serve on the defendant a summons for judgment in Form No. 4A in Appendix B or such other Form as may be prescribed from time to time, returnable not less than ten days from the date of service supported by an affidavit verifying the cause of action and the amount claimed and stating that in his belief there is no defense to the suit.
(5) The defendant may, at any time within ten days from the service of such summons for judgment, by affidavit or otherwise disclosing such facts as may be deemed sufficient to entitle him to defend, apply on such summons for leave to defend such suit, and leave to defend may be granted to him unconditionally or upon such terms as may appear to the Court or Judge to be just:
Provided that leave to defend shall not be refused unless the Court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial defense to raise or that the defense intended to be put up by the defendant is frivolous or vexatious:
Provided further that, where a part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit shall not be granted unless the amount so admitted to be due is deposited by the defendant in Court.
(6) At the hearing of such summons for judgment,
(a) if the defendant has not applied for leave to defend, or if such application has been made and is refused, the plaintiff shall be entitled to judgment forthwith; or
(b) if the defendant is permitted to defend as to the whole or any part of the claim, the Court or Judge may direct him to give such security and within such time as may be fixed by the Court or Judge and that, on failure to give such security within the time specified by the Court or Judge or to carry out such other directions as may have been given by the Court or Judge, the plaintiff shall be entitled to judgment forthwith.
(7) The Court or Judge may, for sufficient cause shown by the defendant, excuse the delay of the defendant in entering an appearance or in applying for leave to defend the suit.
5. Under Order 37 Rule 3 Sub-clause (5), the appellant had moved an application for leave to defend the suit but the learned Trial Court dismissed the application for leave to defend and delivered the judgment in favor of the plaintiff/respondent. The plea taken by the appellant in the application for leave to defend the suit is that he had lost the two cheques which appeared to have been stolen by the plaintiff/respondent and have used the same for filing the present suit against the appellant. We have perused the record and we find that the appellant/defendant has not denied his signatures on any of the documents which have been annexed and relied upon by the plaintiff/respondent in filing the present suit. Both these cheques in question bear the signatures of the appellant. We have also perused the non judicial stamp paper placed on record by the appellant/defendant in which the appellant/defendant has given an undertaking in writing that he will return the sum of Rs. 3,00,000/- by 13.06.2001. The appellant has put his signatures on this undertaking on non judicial stamp paper and besides that, he has also put his thumb impression on the said undertaking. We have also gone through the receipt placed on record by the plaintiff/respondent. The receipt has also been duly executed by the appellant for having received Rs. 3,00,000/- in cash. This receipt is also duly signed by the appellant. After perusing all these documents, it appears that the appellant has taken a false defense that he had lost these two cheques in question which have been stolen by the plaintiff/respondent and has filed a false suit against the appellant. We do not find any force in the plea taken by the appellant in this case. The other documents which have been signed by the appellant are the undertaking given by the appellant on a non judicial stamp paper in which he has stated that he will refund the amount of Rs. 3,00,000/- by 13.06.01 and the appellant has also put his signatures as well as the thumb impression on the undertaking. The appellant has also executed a receipt duly signed by him for having received a sum of Rs. 3,00,000/- in cash. So, we are of the opinion that all these documents cannot be created by the plaintiff/respondent. In our opinion, the plea taken by the appellant is a sham and has got no force. The appeal filed by the appellant is without any merit and the same is, therefore, dismissed. The parties are left to bear their own costs. Trial court record be sent back. File be consigned to record room.