Puri International (P) Ltd. vs D.L.F. Universal Ltd.

Vinod K. Sharma, J.—This revision petition has been filed against the order passed by the learned Civil Judge (Senior Division), Gurgaon allowing the application filed by the respondent herein for leave to defend.

The petitioner-plaintiff has filed a suit under Order XXXVII of the CPC (for short the Code) for the recovery of Rs. 11,54,657/- along with pendente lite interest and costs of the suit. The plaintiff in that suit had claimed that the agreement/contract was void because the consent of the petitioner was obtained by fraud and misrepresentation. The agreement was also challenged being opposed to basic policy and was aimed at unjust enrichment and consequently it was prayed that the contract be declared void ab initio in view of the absence of the free-consent of the plaintiff as the same was taken by the defendant by misrepresentation and fraud. The claim of the petitioner in that plaint further was that deductions made by the defendant while refusing the amount to the petitioner are arbitrary illegal and unauthorised and consequently a decree for a sum of Rs. 11,54,657/- was claimed.

On notice having been issued to the defendant-respondent application for leave to defend was filed wherein the averments made by the petitioner herein were denied. The learned trial Court came to the conclusion that a reading of the plaint read with the application for leave to defend shows that the defendant has substantial defence to raise and the defence intended to be put up by it is not frivolous and vexatious. The Court also took note of the fact that the execution of the agreement was admitted still the same was challenged being illegal, null and void on the ground of fraud and misrepresentation. Thus, leave to defend was granted.

Mr. A.K. Verma, learned Counsel for the petitioner has challenged the finding of the learned trial Court primarily on the ground that the learned Court below ought to have noticed that the challenge to the validity of an agreement on account of petitioner''s consent having been obtained by fraud and misrepresentation as observed in para No. 11 of the order, had no bearing for the purpose of adjudication under Order XXXVII of the Code. The contention of the learned Counsel for the petitioner was that the learned Judge ought to have appreciated that such challenge could not have become a ground for the grant of leave to defend as the challenge was only to the validity of the agreement and not to the existence of the agreement.

Learned Counsel further by making reference to the document produced on record

asserted that the petitioner had, in fact, sought for refund of amount by cancellation of allotment and therefore, they were entitled to refund of the amount. The case of the learned Counsel for the petitioner was that in reply to the said letter the respondent herein had only mentioned that they would revert back to the petitioner after decision on their request is taken and therefore, there was no occasion for them to deduct any amount over and above the amount agreed to in terms of the agreement.

Learned Counsel for the petitioner further alleged that instead of accepting the request of the petitioner the respondent raised illegal demand and accordingly the petitioner had to file this suit.

Learned Counsel has also relied upon the provisions of Order 37 Rule 3(5) of the Code where it is provided that where the part of amount claimed by the plaintiff is admitted by the defendant to be due from him the leave to defend cannot be granted unless the amount so admitted to be due is deposited by the defendant in Court. In view of this contention learned Counsel says that the order of learned trial Court is liable to be set aside.

Mr. A.K.Chopra, learned senior counsel appearing for the respondent, on the other hand, contended that the suit as framed did not fall within the ambit of Order XXXVII Rule 1 of the Code as the basis of the suit was not as per the terms of the agreement but the petitioner was challenging the contract to be illegal and void and therefore, the suit as framed could not be treated to be under Order XXXVII of the Code. The argument of the learned Counsel for the respondent is that the contentions raised by the learned Counsel for the petitioner cannot be decided in a summary manner as the respondent has a substantial defence to the suit filed by the petitioner and thus, leave to defend has been rightly granted. Learned Counsel for the respondent placed reliance on the judgment of Hon''ble Supreme Court in Mechelec Engineers and Manufacturers Vs. Basic Equipment Corporation, wherein Hon''ble Supreme Court has been pleased to lay down that 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 allow to sign judgment and the defendant is entitled to unconditional leave to defend. Thus, the contention of the learned Counsel for the respondent was that mere reading of the plaint itself shows that there is a triable issue and thus, it was entitled to unconditional leave to defend which has been rightly granted and the same does not call for interference by this Court.

I have considered the argument raised by the learned Counsel for the parties and find no force in the present revision petition. The contention of the learned Counsel for the petitioner that the learned Judge ought to have appreciated that the challenge to the agreement could not be a basis for leave to defend, cannot be sustained as the Court under Order XXXVII of the Code is merely to see whether the defence raised by the defendant is substantial with a possibility of the right of the plaintiff being defeated and once the plaint is filed in such form which needs adjudication no fault can be found with the finding recorded by the learned trial Court.

The Court in the absence of the pleadings in the plaint cannot really appreciate the deference raised by the defendant and therefore, in my opinion learned Counsel for the petitioner is not correct to contend that the defence raised by the respondent was to be seen in the absence of the plaintiffs case as set up in the plaint.

The next contention of the learned Counsel for the petitioner that the defendant was only entitled to conditional leave to defend in view of the provisions of Order XXXVII Rule 3(5) of the Code would also be of no help as admittedly the amount admitted by the defendant in their written statement stood already paid and the defence raised by the defendant-respondent in the written statement was that it was not liable to pay any amount. The law is well settled that under Order XXXVII of the Code leave to defendant to be granted to the defendant if any triable defence has been raised which arises in the present case. Therefore, no fault can be found with the judgment passed by the learned trial Court which may call for interference by this Court in revisional jurisdiction.

No merit. Dismissed.