Civil Revision No.1528 of 2007 : 1 : IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH DATE OF DECISION: April 28, 2008 Narang Trading Co. & another .....Petitioners VERSUS M/s Accord Distributors Pvt.Ltd., Sector 28-A, Chandigarh. ....Respondents CORAM:- HON'BLE MR.JUSTICE RANJIT SINGH 1. Whether Reporters of local papers may be allowed to see the judgement? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? PRESENT: Mr.S.K.Bhardwaj, Advocate, for the petitioners. Mr.Arun Nehra, Advocate, for the respondent. **** RANJIT SINGH, J. The petitioners were granted leave to defend subject to furnishing surety to the tune of Rs.six lacs in a suit for recovery of Rs.5,15,000/- being principal and interest filed by respondent M/s Accord Distributors Pvt. Ltd. The suit was filed under Order 37 CPC. The petitioners have impugned the said order on the ground that they are entitled to unconditional leave to defend in view of the defences Civil Revision No.1528 of 2007 : 2 : raised and as appreciated by the trial Court. It is noticed that the trial court found on account of more than one reason that the petitioners have raised valid defences and thus are entitled to defend the suit on the ground that the suit does not satisfy the requirement of Order 37 Rule 1(2) CPC. Plea of counter claim and set off is alleged to have been raised. Plea in regard to maintainability of the suit is also pleaded under Order 37 as there is no written contract. The learned counsel for the petitioner refers to Sanjay Khemani Versus Jhunjhunwalla Synthetic Ltd., 2004(1) ICC 780 to urge that if the defendant discloses such facts as may be deemed sufficient to entitle him to defend and raises a triable issue indicating that he has a fair and bonafide reasonable defence, then he is entitled to unconditional leave to defend. On the other hand, Mr.Nehra representing the respondent has relied on the case of Defiance Knitting Industries Pvt.Ltd. Versus Jay Arts 2006(4) RCR (Civil) 493. Hon'ble Supreme Court in this case has held that in a suit instituted under Order 37 Rule 2 and 3 CPC, the court shall observe the following principles while granting leave to defend:- (1)If the Court is of opinion that the case raises a triable issue then leave to defend should ordinarily be granted unconditionally. (2) The question whether the defence raises a triable issue or not has to be ascertained by Court from the pleadings before it and the affidavits of parties. AIR 1965 SC 1698 relied. (3) If the Court is satisfied that the facts disclosed by the Civil Revision No.1528 of 2007 : 3 : defendant do not indicate that he has a substantial defence to raise or that the defence intended to put by the defendant is frivolous or vexatious it may refuse leave to defend altogether. (4) In cases where the Court entertains a genuine doubt on the question as to whether the defence is genuine or sham or whether it raises a triable issue or not, the Court may impose conditions in granting leave to defence. (5) Leave is declined where the Court is of the opinion that the grant of leave would merely enable the defendant to prolong the litigation by raising untenable and frivolous defences. AIR 1990 SC 2218 relied. Thus, where the court is of the opinion that the case raises a triable issue, then leave to defend should ordinarily be granted unconditionally. It is only in those cases where the court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial defence to raise or that the defence intended to put by the defendant is frivolous or vexatious it may refuse leave to defend altogether. It is in those cases when the court entertains general doubts on the questions as to whether the defence is genuine or sham or whether it raises triable issues or not that the court may impose conditions in granting leave to defend. As already noted in this case, the court has found that petitioners have raised triable issues in their defence on more than one count and as such in view of the law laid down by the Hon'ble Supreme Court, the Civil Revision No.1528 of 2007 : 4 : petitioners shall be entitled to an unconditional leave to defend. It is not a case where the defence raised by the defendant is found to be vexatious and frivolous. The court has also not expressed any doubt in regard to the genuineness of the case or otherwise has found it to be sham for which the conditions could have been imposed while granting leave to defend. Accordingly, I am of the view that the impugned order granting leave to defend as granted to the petitioners on furnishing of surety cannot be sustained. The same is set-aside and the petitioners would have leave to defend the case unconditionally. The revision is accordingly disposed of. April 28, 2008 ( RANJIT SINGH ) ramesh JUDGE