Partly allowed

M/S Archana Industries Transforment Pvt. Ltd. v. M/S Alfa Transcore Industris

Bombay HC22 Mar 2005APP/171/2005

Case brief

AI extract

What is this about?

The High Court of Bombay disposed of two appeals regarding summary suits for money owed. The Court held that revalidated cheques barred a limitation defence. It modified an order granting conditional leave to defend, restricting the payment deposit requirement to only one suit to prevent double liability arising from a single settlement. The other suit received unconditional leave to defend.

What did the court decide?

Unconditional leave to defend granted for one suit; conditional leave to defend with restricted deposit operation upheld for the other suit.

M/S Archana Industries Transforment Pvt… — Contract and Commercial Disputes | Bombay HC (2005)

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 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
 ORDINARY ORIGINAL CIVIL JURISDICTION

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 APPEAL NO.170 OF 2005
 IN
 SUMMONS FOR JUDGMENT NO.229 OF 2003
 IN

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 SUMMARY SUIT NO.114 OF 2003

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 M/s.Archna Inds. Transformers Pvt.Ltd. ....Appellants
 Ori.Defts
 V/s.

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 M/s.Alfa Lamination ....Respondents
 Ori.Plffs

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 WITH

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 APPEAL NO.171 OF 2005
 IN

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 SUMMONS FOR JUDGMENT NO.230 OF 2003
 IN

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 SUMMARY SUIT NO.113 OF 2003

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 M/s.Archna Inds. Transformers Pvt.Ltd. ....Appellants
 Ori.Defts
 V/s.

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 M/s.Alfa Transcore Industries ....Respondents
 Ori.Plffs

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 Mr.R.V. Govilkar for the Appellants.
 Mr.Rajeshwar for the Respondents.

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P.C. :

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 1. By consent the Appeals are admitted and heard

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 finally. As the learned Judge has passed a common
 order in both the Summons for Judgment, it would be
 convenient to dispose of both the Appeals by this
 common order.

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 2. The Respondents are sister concerns and have
 filed the above Summary Suits against the Appellants.
 The Respondents’ case is that they had supplied
 certain goods to the Appellants and in respect whereof
 they had raised the necessary bills and maintained a
 ledger account in their books of account. In respect
 of the goods sold and delivered in the year 1998-99,
 the Defendants issued various post dated cheques and
 agreed to keep them revalidated if not honoured on the
 due dates. In respect the transactions in Appeal
 No.170 of 2005, six cheques were issued for an
 aggregate sum of Rs.29,94,486/-. Two of the cheques
 were revalidated once and the remaining cheques were
 revalidated twice. The Appellants had counter signed
 the amended date on the cheques. Similarly in respect
 of the transactions in Appeal No.171 of 2005, the
 Appellant had issued three cheques each of which were
 revalidated twice. The amended date was counter
 signed by the Appellant.

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 3. There is hardly any defence on merits.

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 Mr.Govilkar, the learned counsel appearing on behalf

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 of the Appellants submitted that the suit was barred
 by limitation. There is no substance in this defence
 as the cheques have been revalidated. Mr.Govilkar
 disputed the Respondents’ case that the cheques had
 been counter signed in respect of the change in the
 date thereof. However, after seeing the cheques which
 were produced in the Court, he admitted that in
 respect of some of the cheques the revalidation had
 been counter signed by the Appellants. The denial of
 the signature is in any event false. It is pertinent
 to note that in paragraph 6 of a suit filed by the
 Respondents before the 3rd Joint Civil Judge, Senior
 Division, Nagpur, the Appellants contended that they
 "put a signature below the column in respect of date
 on the cheques so that the same could be altered
 subsequently by the Defendants (the Respondents i.e.
 the Plaintiffs herein) as and when required depending
 upon the schedule of delivery of the material as also
 the schedule of payment, subject of course to this
 being done within the currency of each of the
 cheques". Thus the fact that the revalidation had
 been counter signed is admitted. The suit, filed by
 the Appellants in Nagpur Court is for an injunction
 restraining the Respondents herein from using the said
 cheques. It is further pertinent to note that by a

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 writing dated 7th October, 1999, the Appellants had
 agreed to keep the dates on the cheques valid from
 time to time by signing after revising the dates on
 the cheques suitably. This writing is not denied. It
 further supports the Respondents’ case that the said
 cheques had in fact been revalidated.

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 4. In view of revalidation therefore the suit is
 not barred by limitation.

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 5. It was contended before the learned single
 Judge and before us that ultimately in respect of the
 transactions in both the suits, a settlement was
 arrived at as evidenced by a letter dated 29th
 October, 1998 to the effect that only an aggregate
 amount of Rs.26,00,000/- was payable. The learned
 Judge by the impugned order proceeded on the basis
 that a settlement as stated in the letter dated 29th
 October, 1998 was arrived at and that an amount of
 Rs.10,00,000/- towards part payment thereof had been
 made. He therefore ordered a sum of Rs.16,00,000/- to
 be deposited as a condition for the Appellants to
 obtain leave to defend both the suits.

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 6. It is necessary therefore to examine the
 letter dated 29th October, 1998. The letter is

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 executed by the Respondents in Appeal No.171 of 2005
 i.e. M/s.Alfa Transcore Industries. It records the
 receipt of cheques aggregating to a sum of
 Rs.26,00,000/- in full and final settlement of their
 claims and the dues of all their companies/firms
 against the Appellants vide cheques listed therein.
 The receipt is stated to be executed in final accord
 and satisfaction of all the claims of the Respondents
 in Appeal No.171 of 2005 and their sister concerns.
 We proceed therefore on the basis, as did the learned
 Judge, that such a settlement was arrived at. Thus
 admittedly a sum of at least Rs.16,00,000/- is due and
 payable.

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 7. Mr.Govilkar however submitted that even after
 the alleged settlement dated 29th October, 1998, the
 parties had agreed that only an amount of
 Rs.3,58,354/- "or so" would be payable by the
 Appellants. Mr.Govilkar however fairly admitted that
 there was not a single document or circumstance on
 record which supported this case. We are unable to
 accept the same.

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 8. However, the impugned order would require
 modification. The learned Judge has granted
 conditional leave to defend both the suits subject to

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 the Appellants depositing Rs.16,00,000/- jointly in
 respect of both the above suits. This cannot be done
 for the simple reason that having decided that only a
 sum of Rs.16,00,000/- is to be deposited, the
 Appellants cannot be made to suffer a decree in both
 the suits in the event of their failure to comply with
 the order. The order would have to be restricted only
 to the Summons for Judgment No.230 of 2003 in Summary
 Suit No.113 of 2003 i.e. in Appeal No.171 of 2005.
 This is for the reason that the alleged full and final
 payment was agreed to be made to the Respondents in
 Appeal No.171 of 2005. The receipt dated 29th
 October, 1998 is also addressed and executed by and on
 behalf of the Respondents in Appeal No.171 of 2005.
 The consequence of a failure to deposit must be
 suffered only in that suit and not in both the suits.

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 9. In the circumstances, the Appeals are
 disposed of by the following order :-

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 i). The Appellant is granted unconditional leave
 to defend in respect of the Summons for
 Judgment No.229 of 2003 in Summary Suit No.
 114 of 2003.

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 ii). The impugned order in Appeal No.171 of 2005

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 is upheld but shall be restricted to and
 shall operate only in respect of the Summons
 for Judgment No.230 of 2003 in Summary Suit
 No.113 of 2003.

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 iii). There shall be no order as to costs.

M/S Archana Industries Transforment Pvt. Ltd. v. M/S Alfa Transcore Industris

Case brief

What is this about?

What did the court decide?

M/S Archana Industries Transforment Pvt. Ltd. v. M/S Alfa Transcore Industris

Case brief

What is this about?

What did the court decide?

What the court decided

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