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2017 DIGILAW 2561 (MAD)

S. M. Chandrasekar, Managing Director, M/s VC Emu Farms India Limited v. Annadurai

2017-08-10

A.D.JAGADISH CHANDIRA, R.SUBBIAH

body2017
JUDGMENT : A.D. JAGADISH CHANDIRA, J. 1. This Appeal has been filed as against the Judgment and decree passed by the Additional District Judge, Namakkal, in O.S. No. 122 of 2013, dated 23.09.2015, wherein the learned Additional District Judge, passed an ex-party decree directing the appellants/ defendants to pay the plaintiff a sum of Rs. 21,60,000/- with interest from the date of decree till the realization with costs of Rs. 1,86,305/-. 2. The Appellants are the Defendants and the Respondent is the Plaintiff. The respondent/ plaintiff has filed the above suit for the following reliefs:- (a) directing the defendants to pay to the plaintiff a sum of Rs. 21,60,000/- with subsequent interest from the date of the suit, till the realization of entire decree amount, jointly and severally. (b) for the cost of the suit. 3. The case of the plaintiff is that the first defendant is a registered company, incorporated under the Companies Act, carrying on business at Vanndinatham Village, Tiruchengodu Taluk, Namakkal District; that the second defendant is the Managing Director of the first defendant company and the defendants 3 and 4 are the Directors of the said company and that the defendants 2 and 3 are husband and wife; that being a depositor of the first defendant company, the plaintiff is well known to the defendants 2 to 4; that on 01.09.2012, the defendants 2 and 3 approached the plaintiff and asked loan for a sum of Rs. 18,00,000/- for their urgent family expenses and for their business activities, assuring to repay the said sum with accrued interest at 2% per month to the plaintiff; that believing the defendants' words, the plaintiff issued a cheque on 03.09.2012 in favour of the first defendant for a sum of Rs. 18,00,000/- that in order to repay the said loan amount the defendants 2 and 3 jointly issued two cheques bearing Nos. 085767 and 085768 dated 05.03.2013, drawn on Axis Bank Limited, for the value of Rs. 18,00,000/- that in order to repay the said loan amount the defendants 2 and 3 jointly issued two cheques bearing Nos. 085767 and 085768 dated 05.03.2013, drawn on Axis Bank Limited, for the value of Rs. 9,00,000/- each in favour of the plaintiff promising to repay the said sum to the plaintiff on or before the date mentioned in the cheques and requested him not to present the said cheques for collection without the knowledge of the defendants; that on 06.09.2012, the defendants realized the loan amount in the first defendant's account and on that day itself they are jointly and severally liable to repay the said loan amount to the plaintiff with accrued interest; that the defendants 1 to 4 failed to keep their promise and that they neither paid the interest nor the principal to the plaintiff; that when the plaintiff asked the defendants for realization of the loan amount, they assured to the plaintiff to present their cheques for collection on 20th May, 2013; that when the plaintiff presented the said cheques in his account at Karur Vysya Bank Limited, Bhavani, on 20.05.2013 for collection, the said cheques were dishonoured on 21.05.2013 as Funds Insufficient and immediately, the plaintiff contacted the second defendant through phone, but he did not give any proper answer; that on 07.06.2013, the plaintiff issued a legal notice to the defendants calling upon them to repay the amount with accrued interest; that the fourth defendant received the legal notice on 13.06.2013, but he neither replied nor repay the loan amount; that the defendants 1 to 3 returned the legal notice. Hence, the suit has been filed. 4. Hence, the suit has been filed. 4. Opposing the case of the plaintiff, the 4th defendant had filed a written statement inter-alia stating that there is no necessity for the defendants to borrow loan from the plaintiff since the defendants are running the EMU farm from the year 2008 and that the plaintiff is the beneficiary of the firsts defendant EMU farm from the year 2010 and that he has deposited some amount for rearing EMU and was receiving some amount from the first defendant farm in every month; that while so, the Tamil Nadu Government has taken action against some of the EMU farms and at this juncture, on compulsion of the plaintiff two cheques dated 05.03.2013, drawn on Axis Bank, Thiruchengodu Branch and two cheques drawn on Indian Bank, Elachipalayam were issued by the fourth defendant in favour of the plaintiff and based on the two cheques bearing No. 575269 and 575270, dated 05.03.2013, drawn on Axis Bank, Thiruchengodu, the plaintiff has issued a legal notice dated 05.03.2013 and that the first defendant farm has issued a reply to the said legal notice on 08.05.2013 through their lawyer; that the defendants never borrowed any loan from the plaintiff as alleged by the plaintiff and that there is no necessity for them to borrow loan from the plaintiff; that the suit has been filed with false averments and in fact since the plaintiff was a beneficiary in the first defendant farm from 2010 and even though the plaintiff had insisted to become a partner of the farm by accepting the amount already deposited by him in the EMU farm as contribution to become a partner of the farm, but the first defendant had repaid the amount by issuing four cheques in favour of the plaintiff to close his accounts; that since the accounts of the EMU farms were freezed, the cheques presented by the plaintiff were returned by his banker for the reason Insufficient Funds and in this regard, the plaintiff lodged a complaint against the first defendant farm and based on the mediation between them, he has received six cheques bearing Nos. 102084, 102083, 102086, 102087, 102087, 102089 and 102090 for the value of Rs. 1,06,00,000/- that the present suit has been filed by the plaintiff with an ill-intention to grab the property of the first defendant farm. Hence, the defendants prayed for dismissal of the suit. 5. 102084, 102083, 102086, 102087, 102087, 102089 and 102090 for the value of Rs. 1,06,00,000/- that the present suit has been filed by the plaintiff with an ill-intention to grab the property of the first defendant farm. Hence, the defendants prayed for dismissal of the suit. 5. Based on the said pleadings, the trial Court has framed five issues. During the trial, on the side of the plaintiff, the plaintiff examined himself as PW-1 and marked 9 documents as Exs.A1 to A9. On 04.03.2015, neither the defendants nor their counsel present on that day to cross-examine PW-1, they were set ex-parte and the matter was adjourned to 22.03.2015 for Pronouncing Judgment. On that day, the defendants have filed an Application in I.A. No. 80 of 2015 and sought for reopening the case and the said application was allowed on 01.07.2015. Again the case was adjourned on several occasions i.e. 20.08.2015, 02.09.2015, 10.09.2015, 16.09.2015 and 23.09.2015 for cross-examination of PW-1. Finally on 23.09.2015 when the matter was called, the plaintiff and 4th defendant alone were present. Defendants counsel was not present. Hence, the learned trial Judge has passed an ex-parte decree as prayed for by the plaintiff with costs. 6. The learned counsel for the appellants/defendants submitted that though several grounds have been raised in the grounds of appeal, now he confines his arguments only to the limited extent of setting aside the ex-parte order and for remitting the matter back to the trial Court so as to give one more opportunity to the appellants/defendants to contest the suit on merits. The learned counsel for the appellants/defendants further submitted that the appellants/defendants would co-operate before the trial Court for early completion of the trial and hence he sought to fix the time limit to the trial Court for completion of the trial. 7. The learned counsel for the appellants/defendants further submitted that the appellants/defendants would co-operate before the trial Court for early completion of the trial and hence he sought to fix the time limit to the trial Court for completion of the trial. 7. Per contra, the learned counsel representing the counsel for the respondent/plaintiff has vehemently objected to set aside the ex-parte order stating that it is not the first time the appellants were absent and even on the earlier occasion i.e. on 4.3.2015, when PW-1 was examined in chief, the counsel for the appellants/defendants was not present to cross-examine PW-1 and hence the case was adjourned to 22.03.2015 for pronouncing judgment and again the case was adjourned on several occasions i.e. 20.08.2015, 02.09.2015, 10.09.2015, 16.09.2015 and 23.09.2015 for cross-examination of PW-1 and finally on 23.09.2015 when the matter was called the plaintiff and 4th defendant alone were present and the defendants' counsel was not present to cross examine PW-1. Hence, it is the contention of the learned counsel for the respondent/plaintiff that though sufficient opportunities were given to the appellants/ defendants to cross-examine PW-1, they have not chosen to cross-examine him and that the conduct of the appellants would show that they are protracting the matter. Hence, he prays for dismissal of the appeal. 8. Irrespective of the rival submissions, we are of the considered opinion that since the appeal is preferred as against the ex-parte decree passed by the learned trial Court, in the interest of justice, in order to give one more opportunity to the appellants/defendants so that they could contest the case on merits, we inclined to set aside the ex-parte decree and remit the matter back to the trial Court. 9. Accordingly, the appeal is allowed and the ex-parte decree and judgment dated 23.09.2015 in O.S. No. 122 of 2013 passed by the Additional District Judge, Namakkal, is set aside and the matter is remitted back to the trial Court, on condition that the appellants shall deposit a sum of Rs. 9. Accordingly, the appeal is allowed and the ex-parte decree and judgment dated 23.09.2015 in O.S. No. 122 of 2013 passed by the Additional District Judge, Namakkal, is set aside and the matter is remitted back to the trial Court, on condition that the appellants shall deposit a sum of Rs. 5 lakhs (Rupees five lakhs only) to the credit of the Suit in O.S. No. 122 of 2013 on the file of the Additional District Court, Namakkal, within a period of four weeks from the date of receipt of copy of the order and on such deposit the trial Court is directed to restore the suit on its file and proceed with the cross-examination of PW-1 and after affording sufficient opportunity of hearing on both sides, conclude the trial within a period of two months from the date of receipt of this order. The appellants/defendants shall co-operate before the trial Court for early conclusion of the trial. No costs. Consequently, C.M.P. No. 20673 of 2016 is closed. 10. The Registry is directed to refund the court fee paid by the appellants in the appeal to the counsel for the appellants. Further, the Registry is directed to send the original records to the trial Court expeditiously.