SANGEETA JEWELS PVT LTD Vs. AJAY KUMAR JAIN

JUDGEMENT

(1.) The challenge by means of this Regular First Appeal filed under Section 96 of the Code of Civil Procedure, 1908 (CPC) is to the impugned judgment of the Trial Court dated 23.1.2001 decreeing the suit of the respondent/plaintiff filed under Order 37 CPC on a dishonoured cheque by dismissing the leave to defend application. It was pleaded by the respondent/plaintiff that the dishonoured cheque of '3,00,000/- was towards the repayment of a cash loan which was granted to the appellants/defendants. The facts of the case are that the respondent/plaintiff pleaded that he gave a loan totalling to '3,00,000/- to the appellants/defendants in three parts, i. e. '1,00,000/- on 3.10.1994, '1,00,000/- on 8.10.1994 and a further sum of '1,00,000/- on 12.10.1994. The loan was given in cash, and the appellants/defendants had issued receipts for the same. It was pleaded that the receipts were given back by the respondent/plaintiff to the appellants/defendants when the defendant No. 2/appellant No. 2 issued and gave to the respondent/plaintiff a cheque for '3,00,000/- bearing No. 903586 dated 12.11.1995 in discharge of the loan. It was pleaded that in addition to giving the cheque towards the loan amount, the defendant No. 2 also paid a sum of '5,100/- in cash towards interest. The subject cheque for '3,00,000/- was dishonoured and when the respondent/plaintiff called upon the appellants/defendants to make payment, the appellants No. 2 and 3, husband and wife, who owned the appellant No. 1/defendant No. 1-company informed the respondent/plaintiff that they were going to convert the appellant No. 1/defendant No. 1-company into a public limited company and would be collecting huge amount of money by selling of the shares of the company and at which time the loan amount would be paid back. However, neither the defendant No. 1/appellant No. 1-company was converted into public limited company nor was the amount of '3,00,000/- paid, forcing the respondent/plaintiff to serve a legal notice dated 1.11.1997 calling for payment of the amount alongwith interest at 18% per annum. No reply was given to this legal notice and therefore the subject suit was filed for recovery of the principal amount of loan alongwith interest at 18% per annum.

(2.) The appellants/defendants entered appearance and thereafter filed a leave to defend application which has been dismissed by the impugned judgment.

(3.) The appellants/defendants denied that there was any transaction of the loans between the parties. It is pleaded that the cheque was given because the respondent/plaintiff said that he would arrange the services of a corporate consultant for the appellant No. 1/defendant No. 1-company who would obtain clearances on its behalf for taking out public issue of shares in the market. Since the respondent/plaintiff failed to arrange the services of the corporate consultant as promised, the cheque had been wrongly presented.