MARUTI TRADERS Vs. GRASIM INDUSTRIES LTD

JUDGEMENT

(1.) PETITIONERS, who are defendants in Original Civil Suit No. 11-B/2002, have filed this petition under Article 227 of the Constitution of India challenging the order dated 24-12-2002, by which the Trial Court while granting application of the petitioners for leave to defend in a summary suit filed under Order 37, CPC, has imposed the condition of furnishing security and personal bond.

(2.) ADMITTEDLY, the respondent/plaintiff has filed a suit for recovery of Rs. 5,20,000/- against the petitioner and the suit is based on a cheque for the aforesaid sum issued by the petitioners which was subsequently dishonoured. Therefore, admittedly the suit is based on dishonoured cheque. It is also not in dispute before me that in the defence the petitioners have not disputed their signatures on the cheque but in the defence their submission is that they have issued a blank cheque in favour of the respondent/plaintiff long back in the year 1998 and thereafter they have closed their business in 1998 and the last transaction between them took place on 24-6-98 and in 1999 they have also closed their bank account. Therefore, in this case, there is a serious dispute between the parties about the transaction and the circumstance in which the same was issued. It is also not in dispute that on the aforesaid ground the Trial Court has granted conditional permission to leave to defend and has directed that security for a sum of Rs. 5 lakhs be furnished with a personal bond.

(3.) THE learned Counsel for the petitioner submitted that the Trial Court ought to have granted unconditional permission to leave to defend in the suit as the Trial Court has already come to a conclusion that there is a serious dispute exits between the parties and the permission with conditions can not be granted. He further submitted that the order passed by the Trial Court is without jurisdiction on the ground of imposing condition. Shri Jain cited various decisions before me. He placed reliance on a decision in the case of Sunil Enterprises and Anr. v. SBI Commercial and International Bank Ltd. , reported in (1998) 5 SCC 354, in which appellant had sought leave to defend on the ground that the bills of exchange were executed without consideration as neither the goods were sold nor supplied in the transaction in question and that there was fraud, collusion and connivance between officers of the Bank and the drawees of the bills and in that context Their Lordships of the Supreme Court has held that unconditional leave must be granted to the appellant/ defendant to defend the suit. In that case Their Lordships of the Supreme Court has considered the position in law which was explained by the Supreme Court itself in earlier cases such as in the cases of Santosh Kumar v. Bhai Mool Singh, AIR 1958 SC 32l; Milkhiram (India) (P)Ltd. v. Chamanlal Bros. , AIR 1965 SC 1698 and Mechelec Engineers and Manufacturers v. Basic Equipment Corporation, (1976) 4 SCC 687: AIR 1977 SC 577, and Their Lordships have summed up and laid down the various propositions of law in the aforesaid decisions. Therefore, the following propositions of law laid down by the Supreme Court are required to be followed while considering the question of granting leave to defend.