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In the case of substantial defence, the defendant is entitled to unconditional leave: High Court of Delhi

The prayer for leave to defend is to be denied in such cases where the defendant has practically no defence and is unable to give out even a semblance of triable issues before the Court. If the defendant satisfies the Court that he has substantial defence, i.e. a defence which is likely to succeed, he is entitled to unconditional leave to defend and the same was upheld by High Court of Delhi through the learned bench led by Justice Prateek Jalan in the case of M/S PARAS FAB vs. M/S SUKH SAGAR SILK AND SAREE [CM(M) 87/2022] on 27.01.2022.

The facts of the case are that the plaintiff filed the suit for a claim of payment for various invoices that were issued by him for supply of goods to the defendant. The plaintiff seeks recovery of an amount of Rs.40,44,452 along with further interest @ 24% per annum until realisation. The plaintiff averred that a legal notice was served upon the defendant claiming the amount, against which the defendant made part payment of an amount of Rs.4,50,000. After receipt of summons, the defendant applied for leave to defend the suit.

The defendant took various defences regarding maintainability of the suit on the ground that the plaintiff did not file the complete bills as alleged by it in the plaint and that the bills do not bear acknowledgement by the defendant, and that a suit under Order XXXVII of the CPC cannot lie in respect of pre-suit interest.

The plaintiff’s counsel contended that the defendant is liable to pay the plaintiff for various invoices that were issued by him and the copies of the invoices have also been placed on record. Out of which many of the invoices bear the signature of the representative of the defendant also. The counsel conceded that the amount may be reduced by the sum of Rs.4,50,000, which was admittedly paid by the defendant to the plaintiff after the issuance of the legal notice. The counsel submitted that the aforesaid payment have not been adjusted against interest on the amount.

In view of the facts and circumstances of the cases, Court was of the opinion that the defendant certainly does not have such a defence as to entitle it to unconditional leave to defend. The Court found no error of jurisdiction or perversity in the order of the Trial Court and was therefore not liable to interference. The petition along with the pending application, was disposed of.

The Court observed that, “the prayer for leave to defend is to be denied in such cases where the defendant has practically no defence and is unable to give out even a semblance of triable issues before the Court. If the defendant satisfies the Court that he has substantial defence, i.e., a defence in which he is likely to succeed, then he is entitled to unconditional leave to defend”.

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Judgment reviewed by – Shristi Suman

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