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2011 DIGILAW 1498 (CAL)

Shridhar Issar v. Bharnobari Tea

2011-12-09

INDIRA BANERJEE

body2011
JUDGMENT: 1. THIS application by Master-s Summons dated 9th April, 2010 has been taken out by the plaintiff under Chapter XIII A of the Original Side Rules of this Court, for final judgment and decree against the defendant, for recovery of a sum of Rs.17,14,242/- together with further interest at the rate of 15% per annum from 1st April, 2007 until payment and other consequential reliefs. 2. THE plaintiff filed the suit being C.S. No.126 of 2007 against the defendant claiming inter alia a decree for Rs.17,14,242/-, interest and costs. The plaintiff claims to have lent and advanced a sum of Rs.10 lakhs to the defendant, of which Rs.2 lakhs was paid by a cheque dated 11th April, 1998 and the balance Rs.8 lakhs by cheque dated 14th April, 1998. According to the plaintiff, the defendant agreed to pay interest to the plaintiff at the rate of 15% per annum, on the said sum of Rs.10,00,000/- and in fact paid interest till the quarter ending 30th September, 2002, after deducting tax at source. A copy of the TDS (Tax Deducted at Source) certificate dated 12th November, 2003 is annexed to the affidavit in support of the Master-s Summons. 3. THE plaintiff allegedly acknowledged and admitted its liability to the plaintiff by issuing confirmation of accounts duly signed by the defendant. Copies of confirmation of accounts signed on behalf of the defendant for the period from 1st April, 2000 to 31st March, 2001 and 1st April, 2001 to 31st March, 2002 are annexed to the affidavit in support of the Master-s Summons. THE plaintiff claims that the defendant admitted and acknowledged liability to the plaintiff for Rs.10,33,213/- as on 31st March, 2002. 4. ACCORDING to the plaintiff, in the statement of accounts sent by the defendant to the plaintiff, for the period from 1st April, 2002 till 31st March, 2003, the defendant wrongfully showed the amount due and payable to the plaintiff as on 1st April, 2002 as Rs.10 lakhs instead of Rs.10,33,213/-. There was also no whisper in the said statement of account, of the interest payable to the plaintiff. The plaintiff has alleged that after repeated demands, the defendant paid a sum of Rs.1 lakh to the plaintiff by a cheque dated 18th June, 2004, but failed and neglected to make payment of the balance in spite of repeated demands. 5. There was also no whisper in the said statement of account, of the interest payable to the plaintiff. The plaintiff has alleged that after repeated demands, the defendant paid a sum of Rs.1 lakh to the plaintiff by a cheque dated 18th June, 2004, but failed and neglected to make payment of the balance in spite of repeated demands. 5. BY a letter dated 30th November, 2004, which was allegedly received by the defendant on 1st December, 2004, the plaintiff demanded his dues from the defendant. It is alleged that the defendant failed to make any further payment to the plaintiff in spite of repeated demands. This suit has been filed by the plaintiff, to recover a debt and/or liquidated amount of money, claimed to be payable by the defendant to the plaintiff, with interest. The claim arises out of a contract. The plaintiff is thus entitled to invoke Chapter XIII A of the Original Side Rules of this Court. 6. RULES 3, 4, 5, 6, and 9 of Chapter XIII A, relevant for adjudication of this application are set out herein-below for convenience: "3. When application to be made.-Where the defendant in any suit which is within the terms of Rule 1 has entered appearance the plaintiff may, as regards any claim which is within the terms of Rule 1, on affidavit made by himself or by any other person who can swear positively to the facts verifying the cause of action and the amount claimed, if any, and stating that in his belief there is no defence to the claim, apply to the Judge for final judgment for the amount claimed together with interest, if any, or for the recovery of the land (with or without rent or mesne profits) as the case may be and costs: Provided that as against any defendant who has filed a written statement such application shall not be permissible unless the summons is taken out as in Rule 4 mentioned within ten days after receipt of notice of the entering of appearance under Chapter VIII, Rule 18. 4. Application by summons.-The application by the plaintiff for judgment under Rule 3 shall be made by summons returnable not less than seven clear days after service accompanied by a copy of the plaint and affidavit. 5. (a) Defendant may show cause.-The defendant may show cause against such application by affidavit. 4. Application by summons.-The application by the plaintiff for judgment under Rule 3 shall be made by summons returnable not less than seven clear days after service accompanied by a copy of the plaint and affidavit. 5. (a) Defendant may show cause.-The defendant may show cause against such application by affidavit. (b) Affidavit.-The affidavit shall state whether the defence alleged goes to the whole or to part only and (if so) to what part of the plaintiff-s claim and shall deal specifically with all matters of fact. (c) Examination.-The Judge may, if he thinks fit, order the defendant or in the case of a Corporation any Officer thereof to attend and be examined upon oath or to produce any lease, deed-book or document or copy of or extract there form. 6. Judgment unless good defence.-Upon such application the Judge may, unless the defendant by affidavit or otherwise as the Judge may direct shall satisfy him he has a good defence to the claim on its merits or disclose such facts as may be deemed sufficient to entitle him to defend, make an order refusing leave to defend and forthwith pronounce judgment, in favour of the plaintiff. 9.Leave to defend.-Leave to defend may be given unconditionally or subject to such terms as to giving security, or time, or mode or trial or otherwise as the Judge may think fit.- Rule 6 quoted above provides that when an application for summary final judgment under Chapter XIII A is made, the Judge is to forthwith pronounce judgment in favour of the plaintiff, unless the defendant is by affidavit or otherwise able to satisfy the Judge that the defendant has a good defence to the claim on its merits or disclose such facts as may be sufficient to entitle him to defend." In Sm. Kironmoyee Dassi and Anr. Vs. Dr. J. Chatterjee reported in AIR 1949 Cal. 479, this Court (S.R. Das, J.) laid down the principles for grant of leave to the defendants, or any defendant to defend a suit, when an application for final judgment under Chapter XIIIA of the Original Side Rules, has been taken out. Kironmoyee Dassi and Anr. Vs. Dr. J. Chatterjee reported in AIR 1949 Cal. 479, this Court (S.R. Das, J.) laid down the principles for grant of leave to the defendants, or any defendant to defend a suit, when an application for final judgment under Chapter XIIIA of the Original Side Rules, has been taken out. This Court held as follows: (a) If the defendant satisfies the Court that he has a good defence to the claim on its merits the plaintiff would not be entitled to leave to sign judgment and the defendant would be 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 would not be 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 would not be entitled to judgment and the defendant would be entitled to leave to defend, but in such a case the Court might, at its discretion, impose condition 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 moon-shine then ordinarily the plaintiff would be entitled to leave to sign judgment and the defendant would not be entitled to leave to defend. (e) If the defendant has no defence or the defence set up is illusory or sham or practically moon-shine then ordinarily the plaintiff would be entitled to leave to sign judgment. The Court might 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 prove a defence. 7. The Court might 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 prove a defence. 7. IN Mechalec Engineers and Manufacturers vs. M/s. Basic Equipment Corporation reported in AIR 1977 SC 577 , the Supreme Court quoted and affirmed the principles laid down in Sm. Kironmoyee Dassi (supra) for grant of leave to defend. 8. THE question is whether the defendant has a good defence to the claim of the plaintiff to entitle the defendant to leave to defend. In the meanwhile, pursuant to the leave granted by this Court, the defendant has entered appearance and also filed a written statement. By a letter dated 6th April, 2010, the defendant-s Advocate informed the plaintiff-s Advocate that he had entered appearance on behalf of the defendant on 1st April, 2010. Under cover of a letter dated 7th April, 2010, the defendant-s Advocate forwarded to the plaintiff-s Advocate, a copy of the written statement filed on behalf of the defendant. Mr. Ashish Chakravarty appearing on behalf of the plaintiff submitted that the defendant has no defence to the claim of the plaintiff. The plaintiff is thus entitled to final judgment and decree. 9. MR. Amitesh Banerjee, appearing on behalf of the defendant, however, submitted that since the defendant-s Advocate has entered appearance and the defendant has filed its written statement, this Court should grant the defendant leave to defend and relegate the disputes to regular trial. However, Rule 3 of Chapter XIII A provides that even after a written statement has been filed, an application for final judgment may be made, provided summons is taken out within 10 days of notice of entering of appearance under Chapter VIII. It is a matter of record that this application by summons has been taken out on 16th April, 2010, within 10 days of notice of entering of appearance. 10. THE defendant has barely denied its liability to the plaintiff, and further denied the allegations in the plaint. It is not disputed that the plaintiff has paid and the defendant has received Rs.10,00,000/- as alleged in the plaint and in the affidavit in support of the Masters Summons. THE genuineness of the receipts is not seriously disputed. 10. THE defendant has barely denied its liability to the plaintiff, and further denied the allegations in the plaint. It is not disputed that the plaintiff has paid and the defendant has received Rs.10,00,000/- as alleged in the plaint and in the affidavit in support of the Masters Summons. THE genuineness of the receipts is not seriously disputed. There is only a vague averment that the sum of Rs.10 lakhs had not been advanced by way of loan but by way of the plaintiff-s contribution to the capital of the defendant company and that the plaintiff had wrongfully and illegally accepted interest by misrepresentation and/or fraud. The allegations are not substantiated by any material particulars or by any evidence on record. 11. THERE can be no dispute that interest has been paid. Certificates of Tax Deducted at Source on the interest paid have been issued. At least one such certificate has been annexed to the affidavit in support of the Masters Summons. The genuineness of the certificate is not in dispute. Mr. Asish Chakravarti also drew the attention of this Court to acknowledgements by way of balance confirmation, the last of which was for the period from 1st April, 2002 to 31st March, 2003. Mr. Banerjee, however pointed out that those acknowledgements which were signed on behalf of the defendant were not within the period of limitation. The later statement of account were not signed on behalf of the plaintiff. 12. MR. Banerjee could not dispute receipt of Rs.10,00,000/-. MR. Banerjee-s submission that the aforesaid amount was by way of contribution of the plaintiff, who had been a Director of the company towards capital of the company is difficult to accept. The aforesaid defence is nothing but a sham defence. Admittedly, no shares were issued to the plaintiff. There is not a whisper of whether provisions of the Companies Act, 1956 for raising and/or enhancement of capital of the defendant company had been complied with. It was for the defendant to disclose facts within the special knowledge of the defendant which the defendant has not done. The bold allegation of contribution of Rs.10 lakhs towards capital of the company is wholly unsubstantiated. There is no cogent explanation for payment of interest, deduction of tax at source on interest paid and also for repayment of Rs.1 lakh by account payee cheque. Mr. The bold allegation of contribution of Rs.10 lakhs towards capital of the company is wholly unsubstantiated. There is no cogent explanation for payment of interest, deduction of tax at source on interest paid and also for repayment of Rs.1 lakh by account payee cheque. Mr. Banerjee has, however, also taken the defence of limitation, which is a good defence. Mr. Banerjee pointed out that on the face of the averments in the suit as also the affidavit in support of the Master-s Summons, part payment of Rs.1 lakh was made by a cheque dated 18th June, 2004. The suit thus became barred by limitation on 18th June, 2007. The endorsement in the Writ of Summons issued to the defendants shows the date of filing of the suit as well as the date of presentation of the suit as 19th June, 2007. Mr. Chakravarti, however, submitted that the plaint was filed in the computer section on 15th June, 2007. As such the suit was filed within the period of limitation. 13. MR. Chakravarti drew the attention of this Court to Chapter XXXIX A of the Original Side Rules, in terms whereof all plaints are required to be filed in the computer section for computerization. According to MR. Chakravarti, the plaint was filed in the computer section on 15th June, 2007, but was placed before the Master on 19th June, 2007. Limitation stopped running on 15th June, 2007. MR. Banerjee-s submission that limitation would run upon presentation of the plaint, before the Master, in view of Rule 4 of Chapter VII of the Original Side Rules, is difficult to accept. Rule 4 of Chapter VII provides as follows: "4.Endorsements on plaint.-Where a plaint is admitted, the words -Presented on the -day of --- together with a note of any special leave granted, and where the suit is marked as a commercial suit under Chapter XII or as a liquidated claim under Rule 5, a note to that effect shall be endorsed thereon and signed by the Judge or officer admitting the plaint; the words -Defendant to file written statement- being added where such statement is required.- There is no conflict between Rule 4 of Chapter VII of the Original Side Rules and Chapter XXXIX A of the said Rules. In any case, Rule 1 of Chapter XXXIX A provides that the rules contained in that Chapter relating to computerization of the cause list of the Original Side are to have effect notwithstanding anything contrary contained anywhere else in the Original Side Rules of this Court." Chapter XXXIX A provides that notwithstanding anything to the contrary contained anywhere else in the Original Side Rules, any plaint, petition, memorandum of appeal or application complete in all respects shall, save as otherwise directed by Court, be presented at the first instance, at the centralized filing section of the Original Side of the Court along with a duly filled in presentation form prescribed as Form A of Appendix 2 of the said Chapter. 14. THE plaint is filed directly in Court with leave of Court only in certain exigencies, for example, where immediate interlocotory relief or any leave of court is sought, whether for leave to file the suit with deficit court fee or for leave under Clause 12 of the Letters Patent, Order II Rule 2 of the Civil Procedure Code or any other provision of law and/or rules of procedure. In all other cases, the plaint would necessarily have to be filed in the centralized filing section. Limitation would stop running the moment a plaint is filed in the centralized filing section. Once the plaint is filed in the computer section the plaintiff has no control over the same. A litigant cannot suffer for no fault of his own, just because of procedural delays in sending the plaint to the Master for the necessary endorsements in terms of Rule 4 of Chapter VII. 15. HOWEVER, the question is whether the plaint was filed on 15th June, 2007. The stamp on the original plaint is supposed to reflect the actual date of filing and not the date on which the plaint was presented before the Master or any subsequent date, more so, when the issue of limitation is involved. 16. PURSUANT to the directions of this Court, the Deputy Registrar (Court) of the Original Side reported that computer records indicate that the suit was filed on 15th June, 2007. The suit number was also allotted on that date. However, the records were forwarded to the Master only on 19th June, 2007. 16. PURSUANT to the directions of this Court, the Deputy Registrar (Court) of the Original Side reported that computer records indicate that the suit was filed on 15th June, 2007. The suit number was also allotted on that date. However, the records were forwarded to the Master only on 19th June, 2007. This Court is, however, unable to appreciate how the date 19th June, 2007 could have been stamped as the date of filing, if the plaint had only been filed on 15th June, 2007. The question of limitation raised by Mr. Banerjee would have to be adjudicated in the suit, upon evidence, if necessary by examination of the officers of the concerned departments of this Court. In any case, if the plaint were filed on 15th June, 2007, the Writ of Summons is out of time, the same having been taken out beyond 14 days from the date of filing of the plaint. If Writ of Summons is not taken out within 14 days, extension of time would have to be obtained. This has admittedly not been done. 17. IT is true, as argued by Mr. Chakravarti that the point of delay in taking out Writ of Summons has not been taken in the Affidavit-in- Opposition or in the written statement. However, the written statement and the Affidavit-in-Opposition had been filed on the assumption that the suit had been filed on 19th June, 2007 as indicated in the plaint as also the Writ of Summons and the question of limitation has been raised. This Court is unable to hold that the defendant has no defence to the claim of the plaintiff. This application for final judgment is, therefore, rejected and the defendant is granted leave to defend the suit.