RAMALINGAM Vs. BASAVALINGAM

JUDGEMENT

(1.) The order of the Court below imposing a condition of furnishing security for grant of leave to defend the suit is not sustainable. The learned Judge has overlooked the provisions or Order XXXVII of the Civil Procedure Code. He has obviously forgotten that the question to be decided for an application for leave to defend is whether there is a triable issue in the suit or whether the claim made by the defendant is a moonshine. The learned Judge without taking into account any of the relevant circumstances has granted leave on condition that the petitioner should furnish security for the amount claimed in the suit on or before a particular date.

(2.) The order deserves to be set aside. Learned counsel for the respondent places reliance on the judgment of the Supreme Court in Messrs. Machelee Engineering and Manufacturers v. Messrs. Basic Equipment Corporation, AIR 1977 SC 577. The Supreme Court set out the following principles to be followed while considering the grant of leave to defend (at p. 580 of AIR) :-

(3.) Learned counsel for the respondent contends that this matter would fall under Clause (c), as according to her, the affidavit does not positively and immediately make it clear that the petitioner has got a defence in the suit. I do not agree with her. The affidavit filed in support of the application for leave to defend has set out the facts clearly on which reliance is placed by the petitioner. Paragraph 8 of the affidavit sets out the circumstances under which the promissory notes were obtained by the respondent herein. In paragraph 18 of the affidavit it is categorically asserted that the petitioner had not received any amount from the plaintiff under the suit promissory notes and the plaintiff never made any demand.