Alpa Marketing Enterprises vs Jaihind Agencies and Others

H.B. Antani, J.—This Revision Application u/s 115 of the CPC is directed against the order dated 30.03.2000 passed by Chamber Judge, Court No. 16, City Civil Court, Ahmedabad below Summons for Judgment in Summary Civil Suit No. 5689 of 1998 whereby the learned Judge gave unconditional leave to defend the suit.

Mr. Gandhi, learned advocate for the petitioner at the outset submitted that in view of the amendment to Section 115 of the Civil Procedure Code, he may be permitted to convert this Revision into a Special Civil Application. He has submitted that in similar circumstances, this Court permitted conversion of Revision Application into Special Civil Application which have also been finally disposed of by this Court. In support of this contention, he has relied on judgment dated 07.02.2007 passed in SCA No. 23320 of 2005, order dated 13.03.2008 passed in SCA No. 19750 of 2007 and order dated 12.12.2008 passed in SCA No. 18677 of 2007. Mr. Gandhi also relied on the judgment of the Apex Court in the case of Col. Anil Kak (Retd.) Vs. Municipal Corporation, Indore and Others, and two judgments of this Court in the case of Chandravadan Manubhai v. Nalini Navin Bhagwati reported in 1996 (1) GLH 36 and in the case of Suvidha Builders v. Dilipsinh Pravinsinh reported in 2004 (O) GL HEL HC 212856.

On merits Mr. Gandhi submitted that the order passed by the learned Judge is erroneous, illegal and contrary to the facts and law, and, therefore, requires to be quashed and set aside. He submitted that the order was passed after four months and therefore it is practically impossible to remember the true and correct facts and therefore, the order is not a legal order. Learned advocate submitted that Summary Suit No. 5689 of 1998 was filed to recover a sum of Rs. 4,46,995-87 on the ground that on 01.04.1997, the total outstanding amount was Rs. 2,57,058-70. He further submitted that for the period from 11.06.1997 to 02.09.1997, goods were sold and the total outstanding including the cost of the goods, interest of late payment, other debit notes etc. the total outstanding amount was Rs. 33,68,939-70. After adjusting payments received at different times and after giving effect to all the credit notes, the net outstanding amount payable by the respondents to the present petitioners comes to Rs. 4,13,924-23. Since the said payment was not forthcoming, a notice was given which was returned with the endorsement, "firm closed". Ultimately, Summary Civil Suit No. 5689 of 1998 came to be filed. It is submitted that as per the terms and conditions of the bill, for late payments, interest at 24% is payable. He submitted that summons for judgment was taken out and leave to defend application was filed by the respondents. In the leave to defend application, the respondents came out with a case of settlement and also that the plaintiff has illegally charged interest on late payment. He submitted that the learned Judge has granted unconditional leave on the ground that there are nearly five entries of interest of late payment totaling to Rs. 2,02,000/- in the year 1995-96, Rs. 55,058-7- in the year 1997-98 and there are also nine such entries totaling to Rs. 67,188-00. The learned Judge has also referred to the settlement arrived at between the parties. He submitted that the learned Judge erred in granting conditional leave and the said order deserves to be quashed and set aside and conditional order be passed to defend the suit.

On the other hand, Mr. J.T. Trivedi, learned advocate representing the respondents submitted that Civil Revision Application is not maintainable more particularly in view of the amendment in Section 115 of CPC, as the order challenged is interlocutory in nature. He submitted that the learned Judge has considered the compilation of documents produced by both the sides as well as the documents on which reliance was placed. He further submitted that considering the entirety of the situation, the learned Judge has used discretionary powers under Order 37 of the CPC, and held that since the issues are triable and bonafide defence is raised, unconditional leave to defend the suit is required to be granted to the respondents. Learned advocate submitted that there is no infirmity in the order passed by the learned Judge which would call for interference by this Court while exercising powers u/s 115 of the CPC. Mr. Trivedi, learned advocate also placed reliance on the following judgments:

Santosh Kumar Vs. Bhai Mool Singh,

Mechelec Engineers and Manufacturers Vs. Basic Equipment Corporation,

Relying on the aforesaid judgment in the case of Mechalev [supra], learned advocate Mr. Trivedi submitted that whenever a defence raised a really triable issue, and if the defences are honest and bonafide, unconditional leave must be given to defend the suit. In paragraph 8 of the judgment, the Apex Court held as under:

In Sm. Kiranmoyee Dassi v. Dr. J. Chatterjee (1945) 49 Cal WN 246 at pg. 253, Das, J., after a comprehensive review of authorities on the subject, stated the principles applicable to cases covered by Order 37, C.P.C. 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 bonafide or unreasonable 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 had a defence yet, shews 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 as to payment into Court or furnishing security.

(d). If the defendant has no defence or the defence set up is illusory or sham or practically moonshine then ordinarily the plaintiff is 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 illusory 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.

In the judgment in the case of Santosh Kumar [supra], the Apex Court held that wherever the defence raises a "triable issue", unconditional leave must be given.

Learned advocate Mr. Trivedi submitted that considering the ratio laid down in the above mentioned judgments, there is no infirmity in the impugned order passed by the learned trial Judge and the petitioner has not made out any case for interference of this Court u/s 115 of the CPC, and, therefore, the Revision Application deserves to be rejected.

Heard learned advocate Mr. Chinmay Gandhi for the petitioner and Mr. J.T. Trivedi for the respondents.

As regards the prayer for permission to convert this Revision into Special Civil Application, this Court is not inclined to accept the said request. The suit is of the year 1998 - about 12 years old. This Revision which is filed in the year 2001 has come up for final hearing after about 9 years. If such permission as sought for is granted, the Special Civil Application may take few more years to come up for final hearing, even if it is entertained. Considering the delay already caused in the matter and the delay that would further cause if such permission is granted, this Court is not inclined to accede to the said request at this belated stage, but on the contrary, would like to dispose of this Revision on merits. Though the impugned order is interlocutory and does not finally decide the lis between the parties, this Court is not dismissing this Revision as not maintainable in view of the amendment, but it is being disposed of on merits in order to prevent further delay. Hence the judgments relied upon by learned advocate Mr. Gandhi is not discussed here in detail.

I have also perused the averments made in the application as well as the impugned order passed by the learned Chamber Judge. The learned Judge has, after considering the documents produced before the Court held that there are certain issues which are required to be determined by the Court at the time of trial and since the defence which was raised by the defendant was bonafide and triable issues, the Court granted unconditional leave to defend the suit. The Court, while granting unconditional leave, has exercised discretionary powers vested in it under Order 37 Rules 3 and 5. I have also perused the compilation produced by the learned advocate on behalf of the petitioner. The affidavit in support of the leave to defend which was filed by the defendant is also perused by me. An amount of Rs. 2,57,058-70 is shown as outstanding as on 01.04.1997. At this stage, there is no explanation whatsoever as to wherefrom the amount has been carried forward and what was the basis for doing so. Moreover, the learned trial Judge has rightly observed that total amount of Rs. 2,69,188/- is charged towards interest on late payment. The respondents have not only denied their being liable to pay any such interest, but also referred to some meeting and settlement talks. The said issue, therefore, is a triable issue. The Court below, while considering the documents, affidavit as well as rejoinder affidavit, granted conditional leave to defend the case to the respondent while exercising discretionary powers under Order 37 Rule 3(2) of CPC.

In view of the aforesaid facts and circumstances of the case, there is no infirmity in the order passed by the learned Chamber Judge in granting unconditional leave to defend the suit.

For the foregoing reasons, there is no merit in the Revision, and therefore, the same is liable to fail. The Revision is accordingly dismissed. No order as to costs. The trial Court is directed to dispose of the suit as early as possible, preferably within six months from the date of receipt of the writ of this order.

Rule is discharged.