1 48 sj.44.09 ndm IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUMMONS FOR JUDGMENT NO. 44 OF 2009 IN SUMMARY SUIT NO. 2244 OF 2008 Surendra M. Jain. ... Plaintiff Versus Mithalal Roopchand Jain and anr. ... Defendants -------- Mr. Mangal Bhandari i/b H.V.Chande for the Plaintiff. Mr. M.D.Mali for Defendant Nos.1, 2-A to 2-E. -------- CORAM : A.S.OKA, J. DATE : 05 th January, 2011. ORAL JUDGMENT. 1 The present suit is for a recovery of a sum of Rs.11,52,800/- with interest component on a sum of Rs.11,00,000/- at the rate of 18% per annum. The suit is based on a cheque, which was dishonoured and a writing dated 16 th January, 2008. 2 48 sj.44.09 2 The case of the Plaintiff is that he is carrying on business in the name and style of M/s.Mangal Palace as a sole proprietor. Reliance is placed on a cheque drawn by the 1 st defendant in favour of the Plaintiff dated 16 th January, 2008 in the sum of Rs.11,00,000/-. The said cheque was returned dishonoured by the 1 st defendant’s bank with a remark “funds insufficient”. It is contended that the cheque was drawn for a valuable consideration. The contention is that on 16 th January, 2008, the Plaintiff gave ornaments of gold weighing about 1050 grams worth Rs. 11,58,700/- to the Defendants on approval basis. The case of the Plaintiff is that a bill in respect of the said ornaments was to be raised after the approval of the ornaments by the Defendants. The 2 nd defendant who died during the pendency of the suit, is the wife of the 1 st defendant. The case of the Plaintiff is that against the receipt of the ornaments and towards payment of the price of the said ornaments, the 1 st defendant had drawn the cheque dated 16 th January, 2008 in the sum of Rs. 11,00,000/- from the account of the 2 nd defendant with Bank of India. Reliance is placed on writing dated 16 th January, 2008, which according to the Plaintiff has been signed by he himself, both the Defendants as 3 48 sj.44.09 well as one Rajesh, son of the Defendants. According to the Plaintiff, the said writing records that the Defendants agreed to give the security of shares worth Rs.15,00,000/-, which were to be sold if the Defendants were unable to pay the amount or to honour the cheque issued in the sum of Rs.11,00,000/- before 21 st January, 2008. 3 The case of the Plaintiff is that the ornaments were approved by the Defendants on 23 rd January, 2008 and accordingly, a bill in the sum of Rs.11,70,261/- (inclusive of tax) was raised by the Plaintiff towards the price of the said ornaments weighing about 1050 grams of gold allegedly sold and supplied by the Plaintiff to the Defendants. The case of the Plaintiff is that the Defendants had assured that they would be sending balance price within few days. 4 The Plaintiff relied on a letter of 28 th February, 2008 issued by his advocate to the Defendants calling upon the Defendants to pay the amount of Rs.11,00,000/-. The notice was replied to by the Defendants by reply dated 10 th March, 2008. The Plaintiff is relying upon the rejoinder 4 48 sj.44.09 dated 28 th March, 2008. According to the case of the Plaintiff, inspection of the original documents was given to the Defendants on 1 st April, 2008. A reference was made to a letter dated 24 th April, 2008 issued by the Defendants’ advocate alleging that documents of which the inspection was given on 1 st April, 2008 were fabricated. 5 The 1 st defendant for himself and on behalf of the 2 nd defendant has filed a reply to the summons for judgment. In the reply, there is a complete denial of transaction of sale of ornaments of gold as pleaded by the Plaintiff. There is denial of execution of writing date 16 th January, 2008. The bill allegedly drawn by the Plaintiff has been also denied. It is contended that the 1 st defendant was holding a family land in Rajasthan. It is contended that in May 2005, the Plaintiff’s father approached the 1 st defendant with a request to sell a portion of the said land to enable him to construct a outhouse. It is stated that accordingly, the land was sold under a document dated 4 th July, 2005 for consideration of Rs.5,00,000/- and the land was purchased in the name of the Plaintiff’s mother. It is contended that in December 2007, a request 5 48 sj.44.09 was made to the 1 st defendant by the Plaintiff’s father to re-purchase the said land. It is agreed that the land shall be sold by the Plaintiff’s mother to the 2 nd defendant for consideration of Rs.11,00,000/-. It is contended in the reply that before the registration of document of sale, the cheque was handed over by the 1 st defendant in the sum of Rs.11,00,000/- on which reliance is placed by the Plaintiff. It is contended by the 1 st defendant that he had informed the Plaintiff’s father that it was not possible to complete the deal. It is contended that though the cheque was required to be returned to the 1 st defendant, the Plaintiff made an attempt to encash the cheque. It was contended in the reply that writing dated 16 th January, 2008 was fabricated and was not signed by the Defendants. It was contended that there are overwritings and filling of the gaps in the said writing, which is suspicious in nature. It is contended that a complaint has been filed by the Plaintiff under Section 138 of the Negotiable Instruments Act on the basis of the alleged dishonour of the same cheque. It is contended that in the said complaint, a copy of the bill is produced, which is different from the copy annexed to the plaint. Reliance is placed on the certain answers of the Plaintiff in the cross- 6 48 sj.44.09 examination in the criminal case. 6 The learned counsel appearing for the Plaintiff submitted in the defence that the Defendants have not signed the writing dated 16 th January, 2008 is an afterthought as the said contention was not raised by the Defendants immediately after inspection of the original documents. He submitted that the fact that the cheque in the sum of Rs.11,00,000/- was issued and was dishonoured is not in dispute. The submission is that there is no prima-facie material placed on record to show that the Plaintiff’s father agreed that the land in Rajasthan shall be re-purchased by the 2 nd defendant and towards consideration of re-purchase, the cheque in the sum of Rs.11,00,000/- was issued. He submitted that this is a case where there is absolutely no defence. 7 The learned counsel appearing for the Defendants invited attention of the Court to the writing dated 16 th January, 2008. He is also invited attention of the Court to the Cross-examination of the Plaintiff in the criminal complaint under Section 138 of the Negotiable Instruments 7 48 sj.44.09 Act and in particular, cross-examination made on the said writing. He submitted that it is an admitted position that the document is in the handwriting of two different persons and the material portion of the said document appears to have been filled in subsequently. He submitted that immediately after inspection of the documents was taken, the Defendants have come out with the case that the document was fabricated. He submitted that on the bill on which reliance is placed by the Plaintiff, admittedly there is no signature of the purchaser and there is no evidence of delivery of ornaments. The learned counsel submitted that in the criminal complaint, an invoice has been produced bearing Bill No. 626 and on the said bill, the number has been written in hand. He pointed out that on the bill annexed to the plaint, there is a rubber stamp of Bill No. 626. He submitted that right from the inception, the Defendants have denied the signatures on the writing dated 16 th January, 2008 by submitting that the said document was fabricated document. He pointed out that there is no dispute that there was a sale-deed executed in respect of a land in Rajasthan at the costs of Rs.5,00,000/- in favour of the Plaintiff’s mother. He has tendered across the bar a compilation 8 48 sj.44.09 containing a photocopy of the said sale-deed and material part of the cross-examination of the Plaintiff in the criminal complaint. He submitted that the suit will not be maintainable against the legal representatives of the 2 nd defendant as the drawer of the cheque viz the 2 nd defendant is no more. Inviting attention of the Court to a copy of the cheque which is annexed to the plaint, he submitted that the name of the Plaintiff has been incorporated later on and the first name is “Mangale” whereas the Plaintiff is claiming that he is carrying on business in the name and style of Mangal Palace as a sole proprietor thereof. He submitted that apart from the fact that there were several triable issues, there is a valid defence available to the Defendants and therefore, this is the case for grant of unconditional leave. 8 I have given careful consideration to the submissions. The cheque relied upon by the Plaintiff has been drawn by the 1 st defendant in the sum of Rs.11,00,000/- from the account maintained by the 2 nd defendant. The averments regarding cheque are found in paragraph No. 2 of the plaint. In the affidavit-in-reply filed by the Defendants, the said 9 48 sj.44.09 paragraph No.2 of the plaint has been dealt with by contending that it was falsely stated that a cheque in the sum of Rs.11,00,000/- as alleged by the Plaintiff, was issued for any valuable consideration. In paragraph No.3 of the reply, there is a denial regarding transaction of the sale of ornaments. In clause (ii) of paragraph No.21 of the reply, a case is made out by the Defendants regarding sale of their land in the name of the Plaintiff’s mother for consideration of Rs.5,00,000/-. After pleading the said sale transaction, the 1 st defendant in the reply filed for himself and on behalf of the 2 nd defendant has stated thus: “ii) ..... In May, 2005, Mr. Mithalal Bohra (Jain), who is father of plaintiff had approached to me with request to sale him a small piece of land out of said agriculture land as said Mithalal Bohra intended to construct a out house for his family and accordingly sale was effected under an agrement of sale deed dt. 4/7/05 for total consideration of Rs. 5,00,000/- and said plot was purchased in the name of Smt. Hulasadevi Mithalal Bohra (Jain) who is mother of plaintiff for which agreement for sale was also registered. I say that in advocate reply I also stated that in December 2007 the said MITHALAL BOHRA requested me to purchase the same plot of land and after negotiation It was decided that the said piece of Land would be resold by Smt. Hulasidevi Mithalal Bohra to Sushila Mithalal Jain i.e. defendant no.2 for the consideration of Rs.11,00,000/-. I say that before the registration of agreement for sale for repurchasing the land I had handed over the subject cheque as suggested in the name of plaintiff whose proprietor is Surendra Jain.” 10 48 sj.44.09 9 Thus, there is a clear admission that the cheque was issued and handed over by the 1 st defendant. It is stated that the cheque was in the name of “the plaintiff whose proprietor is Surendra Jain”. Thus, there is a clear admission that the cheque was issued by the 1 st defendant in the name of the proprietary concern of the Plaintiff. The name of the proprietary concern of the Plaintiff as disclosed in the cause title of the plaint is Mangal Palace. Thus, there is an admission that the subject cheque dated 16 th January, 2008 was issued by the 1 st defendant drawn on account of the 2 nd defendant favouring the proprietary concern of the Plaintiff. However, it is contended that the cheque was towards the price of the land sold to the Plaintiff’s mother on the basis of the transaction of re-purchase. 10 The Plaintiff is relying upon writing dated 16 th January, 2008 (Exhibit – C to the plaint). In the writing, it is stated that the Plaintiff “Mangal Palace” has sold / given gold ornaments weighing about 1050 grams worth Rs.11,58,700/- to the Defendants. There is a reference to 11 48 sj.44.09 the cheque in the sum of Rs.11,00,000/- and it is stated that the cheque will be honoured on deposit. It is stated that if the cheque was not honoured before 21 st January, 2008, the security of shares worth Rs. 15,00,000/- will be sold. Specific reliance was placed on the said writing in the notice dated 28 th February, 2008 send by the advocate for the Plaintiff to the Defendants. In the reply dated 10 th March, 2008, there is a denial of the transaction by the Plaintiff. In the said reply, reliance is placed on alleged transaction of re-purchase of the land in the name of the 2 nd defendant. The letter dated 2 nd April, 2008 send by the advocate for the Defendants to the advocate for the Plaintiff, which is marked as Exhibit – I to the plaint, shows that inspection of the said cheque and return memo as well as letter dated 16 th January, 2008 and bill dated 23 rd February, 2008 was given by the Plaintiff to the Defendants. Photocopies of the said documents were also forwarded by the advocate for the Plaintiff to the advocate for the Defendants. By letter dated 24 th April, 2008, the advocate for the Defendants informed the advocate for the Plaintiff the reaction of the Defendants to the documents of which inspection was given. In the said letter, the advocate for the Defendants 12 48 sj.44.09 stated thus: “My client have instructed me to record their reaction to the purported bill and alleged writing. Their reaction is that the bill in question is an after thought exercise of fabricating the bill to show the alleged transaction which had never taken place. So far the alleged writing is concerned it is a classic case of fabrication and use thereof to link with the alleged transaction of alleged sale of gold ornaments. This is for your information.” 11 It is pertinent to note that in the said letter, the Defendants have not specifically denied their signatures on writing dated 16 th January, 2008. There is no specific denial of the signature of their son Rajesh on the said writing. It is pertinent to note that the said letter was written immediately after the inspection of the documents was taken by the Defendants. The Defendants also failed to deny the signature of the 1 st defendant on the cheque in question. It is merely stated that the letter was fabricated with a view to link the cheque to the alleged transaction of sale of gold ornaments. The denial of the signatures specifically comes for the first time in the reply to the summons for judgment. This denial appears to be an afterthought. In the cross-examination of the Plaintiff made in the criminal complaint filed by the Plaintiff, what is brought on 13 48 sj.44.09 record is that the material particulars such as the names of the Defendants as well as the value of the gold and the cheque amount and the cheque particulars in the writing are not in the handwriting of the Plaintiff. It is pertinent to note that in the aforesaid reply dated 24 th April, 2008, the advocate for the Defendants has not come out with a case that any blanks were subsequently filled in by the Plaintiff. In any case, the answers of the Plaintiff brought on record by the Defendants in the criminal case show that the aforesaid material particulars are not in the handwriting of the Plaintiff. 12 As far as the transaction of re-purchase pleaded by the Defendants is concerned, admittedly there is no documentary evidence placed on record. As stated earlier, the Defendants have not disputed the fact that the cheque was issued in the sum of Rs.11,00,000/- favouring the Plaintiff, but their case is that the cheque is towards the price of the land under the transaction of re-purchase for which there is no documentary evidence on record. There is no communication made by the Defendants in writing to the Plaintiff that the deal of re-purchase was 14 48 sj.44.09 cancelled. Thus, the defence based on the alleged transaction of re- purchase does not appear to be a bona fide or plausible defence. There is no dispute that the cheque was dishonoured. 13 It is not in dispute that even according to the case of the Plaintiff, the cheque was issued by the Defendants against the gold ornaments given on approval. According to the case of the Plaintiff, the ornaments were approved on 23 rd January, 2008 and therefore, the bill was raised. It is not the case of the Defendants that the ornaments were returned. The claim for interest at the rate of 18% per annum appears to be based on the bill, which provides for interest at the rate of 24% per annum on unpaid amount. 14 Considering the aforesaid discussion, though no plausible defence has been raised, this is the case where an opportunity will have to be granted to the Defendants to establish their defence subject to compliance with condition of deposit of a sum of Rs.11,00,000/-, which is the cheque amount. Permission will have to be granted to the Plaintiff to 15 48 sj.44.09 withdraw the amount on furnishing security. 15 Hence, summons for judgment is disposed of by passing following order: i. Conditional leave to defend the suit is granted to the Defendants subject to deposit of a sum of Rs. 11,00,000/- in this Court within a period of twelve weeks from today ; ii. On deposit of the amount within the stipulated period of twelve weeks, the suit shall be transfered to the list of commercial causes ; iii. On deposit being made within the stipulated period, it will be open for the Plaintiff to withdraw the said amount subject to furnishing adequate security to the satisfaction of the Prothonotary and Senior Master of this Court. The Defendants shall 16 48 sj.44.09 be heard before accepting the security ; vi. In the event, security is not furnished within the period of three months from the date of the deposit of the amount by the Defendants, the said amount shall be invested in fixed deposit till the disposal of the suit ; v. On failure of the Defendants to deposit of the amount within the stipulated period of twelve weeks, it will be open for the Plaintiff to apply to this Court for passing a decree. [ A.S.OKA, J ]