Bombay High Court granted a summary judgment in favour of the plaintiff due to the defendant’s non-appearance and non-response in a case under S.138 of NI Act
Title: Gini Tex Private Limited v. Soham Fashion & Ors.
Decided on: 29TH AUGUST, 2023.
COMMERCIAL SUMMARY SUIT NO. 1383 OF 2019
CORAM: KAMAL KHATA, J.
Facts:
The plaintiff initiated legal proceedings in the Commercial Division under Order XXXVII of the Code of Civil Procedure 1908 (“CPC”), seeking a summary judgment against the defendants. The plaintiff’s claim amounted to Rs. 45,18,600/-, along with an interest rate of 24% per annum from March 31, 2019, until the complete realization of the claim. The basis of the claim was the sale and delivery of goods, against which cheques were issued.
Issues:
The central issues in the case were:
- Whether the defendants were liable to pay the claimed amount to the plaintiff for the goods supplied?
- Whether the plaintiff was entitled to a summary judgment under Order XXXVII of the CPC?
Contentions:
The plaintiff, represented by Ms. Puthran, argued that they were a manufacturer/supplier of fabrics, and the defendants regularly procured goods from them. An agreed credit period was established, and delayed payments incurred interest charges. The defendants accepted the goods and issued cheques, but these cheques were dishonoured, leading to payment demands and the issuance of notices under Section 138.
The plaintiff highlighted that the defendants had admitted outstanding amounts in a letter and had even proposed a payment schedule. However, the defendants failed to honour their commitments.
The defendants failed to respond to the legal proceedings despite being served with a writ of summons, leading to the plaintiff’s assertion that they were entitled to a summary judgment under Order XXXVII Rule 2 (3) of the CPC.
Decision:
The suit was decreed in favour of the plaintiff for the sum of Rs. 45,18,600/- along with the specified interest. The defendants were required to pay the plaintiff’s legal costs, amounting to Rs. 50,000/-, in addition to any shortfall resulting from the refund of court fees. The plaintiff was entitled to a refund of court fees as per the High Court Rules. The awarded costs would not accrue any interest. The court directed that the decree be drawn up promptly. The plaintiff was granted the liberty to execute the decree without waiting for its official sealing. The summary suit was concluded with the aforementioned terms.
In conclusion, the court granted a summary judgment in favour of the plaintiff due to the defendant’s non-appearance and non-response. This judgment entailed the payment of the claimed amount along with interest, legal costs, and other financial considerations, as outlined in the court’s decision.
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Written by- Aparna Gupta, University Law College & Dept. of Studies in Law