Gurbachan Singh vs Gurdev Singh

H.S. Brar, J.—A prayer has been made in this petition for quashing the order dated 23.2.1996 of the learned Civil Judge (Junior Division), Ferozepur vide which he has declined an application of the Petitioner-Defendant seeking leave to defend the suit filed under Order 37 Rule 3(5) of the CPC (hereinafter called as "Code") by the Plaintiff.

The Plaintiff filed a suit under Order 37 of the Code on the basis of a promissory note alleged to have been executed by the Defendant-Petitioner in is favour. After service of the Defendant, an application was moved by him for leave to defend the suit inter-alia on the ground that the said promissory note was not executed by him and the same was forged and fabricated. He further stated in that application that he never borrowed the alleged amount nor he was liable to pay the same or any interest on it. Accordingly, a prayer was made by the Defendant that he should be given leave to defend the suit.

Upon notice of the application for leave to defend the suit, the Plaintiff took the stand that the Defendant had executed the pronote and receipt in favour of the Plaintiff and then ultimately a prayer was made that the application be dismissed with costs.

The learned trial Court dismissed the application of the Petitioner-Defendant and refused to grant the permission to defend the suit on the following grounds which have bee mentioned in the order of the trial Court itself and are reproduced as under:

If the pronote is seen on the record it bears the signatures of the Defendant and is thumb marked by two witnesses. It cannot be taken for granted that the Plaintiff had forged and fabricated this document in connivance with the witnesses and has filed the false case under Order 37 of CPC The Plaintiff for his alleged act could have been hauled for criminal proceedings and he did not do so. A legal notice was served upon the Defendant by the Plaintiff through his counsel which has not been replied by the Defendant. Had the Defendant not taken the money from the Plaintiff he should have replied the legal notice of the Plaintiff but he has not relied the same. Grounds for leave to defend the suit, according to trial Court are evasive and there exists no ground for the sake of ground to grant leave to the Defendant to defend the suit. The original pronote and receipt are on the record which prove that the Defendant had taken the money from the Plaintiff after having executed the pronote and receipt in his favour. The pronote and receipt are attested by two witnesses.

Learned Counsel for the Petitioner contends that the trial Court has acted with material irregularity and has erred in law in not exercising the jurisdiction vested in it properly by declining the prayer of the Petitioner-Defendant for leave to defend the suit for recovery. Learned Counsel further contends that the order of the trial Court in non speaking and has not assigned any reasons for holding that the plea taken by the Petitioner in his application for defending the suit is not in conformity with the mandatory provisions of Order 37 Rule 3(5) of the Code. It is further contended by the learned Counsel for the Petitioner that the Petitioner-Defendant took specific defence that the said promissory note was not executed by him and the same was forged and fabricated. The Petitioner-Defendant had raised specific objection, as the order of the trial Court itself indicates, that he never borrowed the alleged amount nor he was liable to pay the same or any interest thereon.

In order to substantiate his contentions, learned Counsel for the Petitioner referred to Mechelec Engineers and Manufacturers Vs. Basic Equipment Corporation, wherein principles to be followed while considering the question of granting leave to. defend are narrated and which are mentioned as under:

(a) If the Defendant satisfied 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, 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 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 defence.

On the other hand, learned Counsel for the Respondent-Plaintiff submits that the order of the trial Court is exhaustive and the trial Court has not committed any illegality in dismissing the application of the Petitioner Defendant.

After hearing the learned Counsel for the parties, I find force in the contentions raised by the learned Counsel for the Petitioner. It will be useful to refer to Sub-rule (5) of Rule 3 of Order 37 of the Code. The relevant sub-rule 5 is reproduced as under:

Order 37, Rule 3(5) - 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 substantial defence to raise or that the defence intended to be put up by the Defendant is frivolous or vexatious. It is clearly provided in Sub-rule 5 of Rule 3 of Order 37 of the Code that leave to defend the suit may be granted to the applicant unconditionally or upon such terms as may appear to the Court or Judge to be just and the 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 substantial defence to raise or that the defence intended to be put up by the Defendant is frivolous or vexatious.

The learned trial Court has, in fact, not addressed to the main grounds taken by the Petitioner - Defendant in his application for leave to defend the suit. It has simply dismissed the application mainly on the ground that the pronote bears the signatures of the Defendant and is thumb-marked by the witnesses and thus it cannot be taken for granted that the Plaintiff had forged and fabricated this document in connivance with the witnesses and has filed the false case under Order 37 of the Code and that the Plaintiff could be hauled up for criminal proceedings by the Defendant if he had forged and fabricated the pronote in connivance with the witnesses.

Another ground taken by the trial Court for denying the relief to the Petitioner-Defendant was that the legal notice served upon the Defendant by the Plaintiff through his counsel was not replied to the Defendant and lastly held that the grounds for leave to defend the suit, according to it, were evasive, however, without dealing with the grounds taken by the Petitioner-Defendant to defend his suit.

It is a definite stand of the Petitioner-Defendant in his application before the trial Court to defend the suit that the said promissory note on the basis of which the suit has been filed by the Plaintiff was not executed by the Defendant and the same was forged and fabricated. It was further clearly sated in that application that the Petitioner-Defendant never borrowed the alleged amount shown in the pronote nor he was liable to pay the same. It can be said without doubt that the defence taken by the Petitioner-Defendant clearly raises a triable issue which would have been decided by the trial Court by granting the Petitioner-Defendant necessary permission to defend the suit. In fact, the trial Court ha snot given any firm finding by dealing with the defence taken by the Defendant that the Defendant had no reasonable defence to defend the suit in question.

In view of the clear mandate of the provisions of law narrated above and the judgment of the Supreme Court referred to above, the impugned order dated 23.2.1996 of the trial Court is liable to be set aside.

Consequently, this revision petition succeeds and the impugned order dated 23.2.1996 of the trial Court is quashed and the application for leave to defend the suit by the Defendant is allowed. The parties through their counsel are directed to appear before the trial Court on 5.3.97 for further proceedings.