MAYA vs YASH CSOS 2254/13 27/04/15 [ Jayant JJ ] [ DELHI HIGH COURT ]Leave to defend dismiss

• Suit for Recovery Application under Order 37 Rule 3(5) of the CPC seeking leave to defend the suit. Plaintiff agreed to give a “dasti” loan of Rs. 45 lacs to the defendant. Defendant acknowledged having received the said sum of Rs. 45 lacs in cash vide receipt. Defendant is stated to have handed over an original signed receipt to the plaintiff with two cheques respectively drawn on Corporation Bank, Noida to enable the plaintiff to realise the sum on the stipulated date. However, I have already held in First Lucre Partnership Co. vs. Abhinandan Jain (supra) in somewhat similar facts and circumstances that the suit is based on a receipt issued by the defendant and not on the basis of the unpresented cheques. The present suit is not based on the unpresented cheques but is based on the receipt executed by the defendant showing receipt of Rs. 45 lacs as a loan. Defendant has failed to show any worthwhile defence to the case of the plaintiff. The defence is entirely moonshine and frivolous. Defence is entirely moonshine and frivolous. The receipt showing receipt of Rs. 45 lacs has been placed on record duly corroborated by post dated cheques. All three documents are duly signed by defendant. The primary defence that the receipt was executed without receipt of any money whatsoever is a complete sham defence with no basis whatsoever. It is not possible to grant leave to defend to the defendant on this defence on other pleas taken. Application dismissed.

10. Coming to the third contention of the defendant about cheque having been signed by Shri Yash Chhabra in the capacity of Director of M/s Sanya Fibre Private Limited whereas the receipt is signed by the said Yash Chhabra in the individual capacity. This contention again appears to be misplaced and without any merits. The receipt executed by the defendant Mr.Yash Chhabra specifically states that payment has been received by the defendant against cheque No.690846 and 690845 i.e. the cheques issued by the said M/s Sanya Fibre Private Limited. The signatory of the cheque and the receipt is the same i.e. Mr.Yash Chhabra. What persuaded the defendant i.e. Mr.Yash Chabra to issue cheques from the account of M/s Sanya Fibre Private Limited? It was for him to have explained. His own conduct and acts cannot constitute a ground for defence of the present suit. There is no attempt even to explain the relationship between the defendant and the M/s Sanya Fibre Private Limited. In fact a perusal of the documents filed by the defendants show that the defendant himself has filed on court record IT returns and bank statements of M/s Sanya Fibre Private Limited. He has also filed along with list of documents a list of shareholders of M/s Sanya Fibre Private Limited. The shareholding of M/s Sanya Fibre Private Limited shows that bulk of the shares the owned by the defendant himself. A small amount of shares are owned by his wife, son and daughter. It is a family company wholly controlled by the defendant and his family. The plea is clearly without merits.
11. Coming to the fourth contention. It is contended that the cheques
cannot be the basis of a suit under Order 37 CPC. The contention of the defendant is that the cheques were not presented and hence a suit does not lie under Order 37 of CPC, in view of the judgments cited by the defendant. There can be no dispute with the said contention. The Division Bench in Bal Dev Singh vs. Rare Fuel and Automobiles Technologies (P) Ltd. (supra) has categorically held so.
However, I have already held in First Lucre Partnership Co. vs. Abhinandan Jain (supra) in somewhat similar facts and circumstances that the suit is based on a receipt issued by the defendant and not on the basis of the unpresented cheques. The present suit is not based on the unpresented cheques but is based on the receipt executed by the defendant showing receipt of Rs.45 lacs as a loan.
12. One cannot also ignore section 139 of the Negotiable Instruments Act which provides that it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque for discharge, in whole or in part, of any debt or any other liability. Hence, an unpresented cheque cannot be a basis of a suit under Order 37 CPC. However, the plaintiff can certainly use it to support the receipt dated 20.01.2011 i.e. it would have evidentiary value.

13. In my opinion, the facts of the above case fall in the category (d) which have been narrated by the Supreme Court in the case of M/s.Mechelec Engineers & Manufacturers vs. Basic Equipment Corporation (supra). The defendant has failed to show any worthwhile defence to the case of the plaintiff. The defence is entirely moonshine and frivolous. The receipt showing receipt of Rs.45 lacs has been placed on record duly corroborated by post dated cheques. All three documents areduly signed by defendant. The primary defence that the receipt was executed without receipt of any money whatsoever is a complete sham defence with no basis whatsoever. It is not possible to grant leave to defend to the defendant on this defence on other pleas taken. Application is dismissed. CS(OS) 2254/2013
14. As the above application for leave to defend has been dismissed, the suit is decreed with interest @9% per annum from the date of filing of the suit till recovery. Plaintiff shall also be entitled to costs.

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Maya jain Vs Yash Chabra delhi high court the law literates

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