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Hotel Paras & Another v/s Sound Vision

    Civil Revision Petition No. 1221 of 1997

    Decided On, 27 April 1998

    At, High Court of Rajasthan

    By, THE HONOURABLE MR. JUSTICE P.C. JAIN

    For the Appellant: Suresh Shirmali, Advocate. For the Respondent: K.C. Samdariya, Advocate.



Judgment Text

P.C. Jain, J.

1. The petitioner-defendants have filed this 'revision petition u/s LI5, C.P.C. agains the order dated 19-11-1997 passed by the learned Additional District Judge No. 1. Udaipur in Civil Suit No. 179/97 whereby the learned Judge though grunied leave to defend to the petitioners, imposed the condition of furnishing a hank guarantee equivalent to the suit amount of Rs. 1.44.300/-.

2. The plaintiff filed a suit for recovery of the above amount against the defendants on the footing of the balance found due from the defendants in respect of the mutual dealings. The defendants tiled an application on 15-9-1997 challenging the suit amount and alleged that the suit has been filed on forged documents. The defe

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ndants stated that plaintiff gave a notice for Rs. 2.83.120/- but the suit was filed only for Rs. I.44.300/-. The defendants further took pleas of non-joinder of the other partners of the firm, insufficient Court-fees, unsigned bills and limitation etc. The defendants, therefore, made a prayer for leave to defend the suit.

3. The learned Additional District Judge then addressed himself to the prayer made by the plaintiff and stated the cardinal principle which govern the question of granting or withholding the leave to defend and in the instant case after a perusal of the application of the defendants and the documents, felt persuaded 10 grant leave to defend in terms of Order 37. Rule 3 .C.P.C. on the condition that the defendants furnishes a hank guarantee of the above amount within a period of one month from the dale of the impugned order.

4. I have heard learned counsel for the petitioners and the learned counsel for the non-petitioner.

5. Learned counsel for the petitioners has assailed the impugned order us regards the condition imposed by the learned Additional District Judge. Learned counsel has referred to the leading case on the subject Mechelec Engineers and Manufacturers Vs. Basic Equipment Corporation, Learned counsel has submitted that the learned Additional District Judge has himself observed that the defendants has prima facie case in which he has got a tribal issue. Thus the defendants has prima facie established a fair probability that he has got a bona fide defence. Indeed the trial Court accepted this fad and allowed leave to defend. The learned Addi tional District Judge was however, not justified in imposing the condition which virtually amounts to withholding the leave to defend inasmuch as it may be impossible for the defendants to arrange for a bank guarantee which is normally issued by the bank on making a cash deposit of the above amount. The Hon'blc Supreme Court in the above case has laid down principles and the defendants qualifies conditions as given in the above judgment. Learned counsel has also cited a tow other cases. Nemichand v. Shantilal. 1990 (2) RLW 120; Smt. Renuka Parihar v. Bank of Baroda. 1988 (2) RLR 804 and Narinder Kumar v. Kundan Lal Gupta. 1989 (2) CCC 424.

6. Learned counsel for the non-petitioner has supported the order of the trial Court on the ground that the defendant has only denied the averments made by the plaintiff. From the application filed by the defendant it is not disctosed that the defendants has got a tangible defence which can non-suit the plaintiff. Moreover it was within the discretion of the Court to altos conditional leave to defend. Normally, in revision, no interference is made in such discretionary order.

7. I have considered the rival contentions. In M/s. Mechalec Engineers and Manufacturers' case, the Apex Court approved the following principles laid down in Smt. Kiranmoyec Dassi v. Dr. J. Chatlerjcc. 49 CWN 246 :--

"(a) If the defendant satisfies the Court that he has a good defence to the claim on its merits the plaintiff is not entitled to leave to sign judgment and the defendant is 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 is not entitled to sign judgment and the defendant is 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 had 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 is not committed to judgment and the defend am is entitled to leave to defend but in such a case the Court may in its discretion impose conditions 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 moonshine then ordinarily the plaintiff is entitled to leave to sign judgment and the defendant is not entitled to leave to defend.

(e) If the defendant has no defence or the defence is illusory or sham or practically moonshine then although ordinarily the plaintiff is entitled to leave to sign judgment, the Court may protect the plaintiff in only allowing the defence to proceed if the amount claimed is paid in the Court or otherwise secured and grant leave to the defendant on such condition and thereby show mercy to the defendant by enabling him to try to prove a defence.

8. The above principles have been followed consistently by this Court in Nemichand v. Shantilal and other cases. This Court took the view that wherever the defendants raises a triable issue, leave must be given unconditionally otherwise the leave may be illusory. It was further held that on satisfaction of the Court that the defence is not bona fide then the Court may impose conditions.

9. In Smt. Renuka Parihar case 1988 (2) RLR 804 (supra), same view was taken and held that if the defendant has a fair or bona fide or reasonable defence, though it will not be positive, the defendant is entitled to unconditional leave to defend. In Narinder Kumar's case of the J. and K. High Court, while interpreting Order 37, Rule 3, C.P.C., observed that order granting leave to defend with condition to furnish bank guarantee equivalent to the suit amount is not legally sustainable because imposition of such a condition travels beyond the scope of the discretion given to the Judge under the above provisions while granting leave to defend. The High Court order set aside the above condition but ordered the petitioner to give security for payment of the suit amount.

10. A perusal of the impugned order clearly shows that the learned Additional District Judge was prima facie convinced that the defendants raised a triable issue and categorically observed that it cannot be said that the defence raised by the defendant is frivotous, vexatious or groundless.

In view of the above observations, I am inclined to agree with the contention of the learned counsel for the petitioner that in such a case leave to defend ought to have been granted without any condition.

11. Accordingly, I allow the revision petition and set aside that part of the impugned order by which a condition was imposed on the petitioners to furnish bank guarantee for defending the suit filed by the plaintiffs. No order as to costs.

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