By Swarnalee Halder, Calcutta University, Department of Law.
Nature and scope
Order 37 provides summary procedure in suits based on negotiable instruments or where the Plaintiff seeks to recover debt or liquidated amount. The essence of summary suits is that the Defendant is not, as in an ordinary suit, entitled as of right to defend the suit. The provisions of Order 37 are merely rules of procedure. They do not alter the nature of the suit or jurisdiction of Courts. The provisions of Order 37 are constitutional. [1]
Applicability
Order 37 CPC is one of the best provisions in the hands of a proposed Plaintiff, wanting to institute a Civil Suit. Broadly it states as under:-
The code provides that summary suit can be laid when the suit is on the basis of a bill of exchange, hundi, or promissory note or when the suit is for recovery of a debt arising on a written contract or guarantee [O. 37 Rule 1].[2]
Object
The object underlying the summary procedure is to prevent unreasonable obstructions by the Defendant who has no defence and to assist expeditious disposal of cases.[3] The real benefit of a suit under Order 37 is that unless the Defendant is able to demonstrate that he has a substantial defence in his case, the Plaintiff is entitled to a judgment forthwith.[4]Taken by and large, the object of the provision is to ensure that the Defendant does not unnecessarily prolong the litigation and prevent the Plaintiff from obtaining a decree by raising untenable and frivolous defences in a class of cases where speedy decisions are desirable in the interest of commercial transactions.[5]
Getting the suit decreed
The pleading of summary suit shall contain pleadings that it is laid under Order 37, in addition to other details of general pleading. When the Court registers a suit as a summary suit, the Court issues notice to the Defendant to explain why the suit shall not be decreed.[6]
Rule 2(3) states the procedure for appearance of Defendant which is within 10 days from the service of the summons on him. After appearance, the Plaintiff serves on the Defendant summons for judgment within ten days from the date of service supported by an Affidavit; verifying the cause of action, amount claimed and that in his belief there is no defence to the suit.
Rule 2(6) states that in case the Defendant does not apply for a leave to defend, (a) the Plaintiff shall be entitled to judgment forthwith or (b) the Court may direct the Defendant to give such security as it may deem fit. Sub-clause 7 states that in case sufficient cause is shown, the delay in entering an appearance or in applying for leave to defend the Suit may also be excused.
Rule 2(5) further states that the Defendant may, within 10 days from service of such summons for judgment, by Affidavit or otherwise disclose such facts as may be deemed sufficient to entitle him to defend, apply for leave to defend and it may be granted to him unconditionally or upon such terms as may appear to the Court to be just. Further, the proviso indicates that leave to defend shall not be refused unless the Court is satisfied that the facts disclosed do not indicate a substantial defence or that the defence is frivolous or vexatious.[7]
Analyisis of Summary Suit based on case laws
In Indian Rayon & Industries Ltd versus M/s Sirohya,[8] it was held that in order to obtain unconditional leave to defend, it is not sufficient to raise triable issues, but he should satisfy the Court that he has a substantial defence.
If there is a triable issue in the sense that there is a fair dispute to be tried as to the meaning of a document on which the claim is based or uncertainty as to the amount actually due or where the alleged acts are of such a nature as to entitle the Defendant to interrogate the Plaintiff or to cross examine his witnesses, leave to defend should not be denied. Rajduggal versus Rameshkumar Bansal.[9]
Powers conferred upon Court by Order XXXVII (Order 37) is a sophisticated and delicate instrument and the same must be handled with great care and caution. In reality, it may be sometime, extremely difficult for Courts to identify “frivolous defences”, “Sham & illusory defences” “substantial defence, unreasonable or dishonest defence”, so as to decide whether leave to defend the Suit should be granted or refused to the Defendant.[10]
In all cases listed below, it may be noted that, the cases in which where the leave to defend was granted, the Defendant has placed such facts before Court, that if proved, will dislodge / washout the case of the Plaintiff.[11]
In a Case before the Hon’ble Delhi High Court, a Summary Suit was filed on the basis of dishonoured cheque of Rs.27,000/- alleged to have been issued in payment of some computer hardware and software sold by Plaintiff and where the Defendant alleged that he has issued a post dated cheque on the assurance from the Plaintiff that the said cheque will be deposited after the delivery of the said hardware and software. The Cheque was however come to be deposited without the said supply of computer hardware and softwares. It was held that the plea raised by the Defendant raises a triable issue inasmuch as the material on record it cannot be said that the defence of the Defendant is malafide or vexatious and is not bonafide. The Defendant was granted unconditional leave to defend. International Computers Consultants versus Home Computer Services (P) Ltd 68 (1997) Delhi Law Times 407 (413 Paras 23 & 24) (DB)[12]
Where the Defendant alleged that the Plaintiff did not act in accordance with the terms of the agreement and therefore the Defendant has stopped payment of cheques and stated that Defendant has already filed suit for specific performance of agreement. It was held that the defence raised triable issues and Defendant was granted unconditional leave to defend. Radhey Shyam & Ors versus Jaibir Singh 67 (1997) Delhi Law Times 875 (877)[13]
If tenor of defences raised by the Defendants blows hot and cold and is self contradictory, he forfeits his right to defend. Vinod Kumar versus Keshav Anand 2002 AIHC 1621 (1624 Para 12.)[14]
Where the price of the goods were payable on the basis of “Cash on Delivery” and where the Defendant accepted the delivery of the goods without any reservation and the Defendant has dealt with the goods after taking delivery, it was held that trial Court was justified in refusing leave to defend. MMTC Ltd versus Dimple Overseas Ltd AIR 2001 Delhi 42.[15]
The idea behind a summary suit as stated in the Neebha Kapoor v Jayatilal Khadwala( SC 2008) case is speedy remedy. But one must not forget – “justice hurried is justice buried”. A few years of Trial is better than a scenario where a decree has been passed without giving proper opportunity to Defendant to put forth its case. “Audi Alteram Partem” is one of the basic features of our Constitution and a fair hearing should be given to all concerned. Order 37 CPC is best suited for cases in which a Defendant does not have a case at all and the suit is prolonged for years.[16]
[1] Civil Procedure with Limitation Act,1963- C.K.Takwani.
[2] http://www.preservearticles.com/2012032929206/short-notes-on-summary-suits.html
[3] Milkhiram India(P) Ltd. v.Chamanlal Bros, AIR 1965 SC 1698; V.K.Enterprise v. Shiva Steels, AIR 2010 SC 2885
[4] http://www.legalservicesindia.com/article/article/order-37-cpc-summary-suits-1514-1.html
[5] Santosh Kumar vs Bhai Mool Singh 1958 AIR 321, 1958 SCR 1211.
[6] http://www.preservearticles.com/2012032929206/short-notes-on-summary-suits.html.
[7] http://www.legalservicesindia.com/article/article/order-37-cpc-summary-suits-1514-1.html.
[8] Enterprises AIR 1992 Bombay 60 (61 & 62)
[9] 1991 sup (1) SCC 191
[10] http://thepracticeoflawjalan.blogspot.in/2012/04/summary-suits-order-37.html
[11] http://commonlaw-sandeep.blogspot.in/2011/01/summons-for-judgment.html
[12] http://thepracticeoflawjalan.blogspot.in/2012/04/summary-suits-order-37.html
[13] http://indiankanoon.org/doc/1849861/
[14] http://common770.rssing.com/chan-12923133/all_p1.html
[15] http://thepracticeoflawjalan.blogspot.in/2012/04/summary-suits-order-37.html
[16] http://www.legalservicesindia.com/article/article/order-37-cpc-summary-suits-1514-1.html