Case Note & Summary
The Petitioner, M/s. Mobile Arts S.A.L., a company incorporated in Lebanon providing digital advertising services, filed a Commercial Summary Suit (No.316 of 2022) against the Respondent, M/s. Mauj Mobile Private Ltd., an Indian media company, for recovery of outstanding dues of USD $115,550.69 along with interest. The claim arose from a Media Sales Insertion Order dated 15.01.2019, under which the Petitioner provided digital advertising services and raised three invoices. The Respondent made a part-payment of USD $10,001.60 but failed to pay the balance. After exchange of emails and a failed pre-institution mediation under Section 12A of the Commercial Courts Act, 2015, the Petitioner filed the suit. The Petitioner then filed a Summons for Judgment (No.152 of 2023) under Order XXXVII CPC. The Trial Court, by judgment dated 25.01.2024, dismissed the Summons for Judgment and granted unconditional leave to defend to the Respondent. The Petitioner challenged this order by way of a Writ Petition before the Bombay High Court. The Petitioner argued that the Trial Court erred in questioning the validity of the admitted agreement and in noting the absence of a certificate under Section 65B of the Indian Evidence Act for email communications. The Petitioner contended that the Respondent had no substantial defence and that the Summons for Judgment ought to have been made absolute. The Respondent, on the other hand, submitted that the suit was not maintainable as a summary suit due to lack of a proper board resolution, and that there were triable issues, including a subsequent settlement agreement via emails. The High Court, after hearing both sides, dismissed the Writ Petition, holding that the Trial Court's discretion in granting unconditional leave to defend was not perverse and that the Respondent had raised triable issues. The Court observed that the Trial Court's findings on the validity of the agreement and the Section 65B certificate were not sufficient grounds to interfere. The Court also noted that the Respondent had filed a reply to the Summons for Judgment after obtaining condonation of delay, and that the defence raised was not frivolous or vexatious. The High Court upheld the impugned judgment and dismissed the Writ Petition with no order as to costs.
Headnote
A) Civil Procedure - Summary Suit - Leave to Defend - Order XXXVII Rule 3(5) CPC - The Court considered whether the Trial Court correctly granted unconditional leave to defend when the defendant raised triable issues, including the existence of a subsequent settlement agreement and the validity of electronic evidence. Held that the Trial Court's discretion was not perverse and the defendant had disclosed facts indicating a substantial defence (Paras 4-6). B) Evidence Law - Electronic Evidence - Certificate under Section 65B - Indian Evidence Act, 1872, Section 65B - The Court noted that the Trial Court's observation regarding the absence of a Section 65B certificate for emails was not a ground to interfere, as the issue of admissibility could be decided at trial. Held that the Trial Court's finding on this aspect was not a reason to set aside the order (Para 4). C) Commercial Courts Act - Pre-Institution Mediation - Section 12A - Commercial Courts Act, 2015, Section 12A - The Petitioner had filed an application for pre-institution mediation under Section 12A, which resulted in a non-starter report due to the Respondent's non-appearance. This was a procedural step before filing the suit (Para 3.8).
Issue of Consideration
Whether the Trial Court erred in granting unconditional leave to defend to the Respondent/Defendant in a Commercial Summary Suit under Order XXXVII CPC, despite the Petitioner/Plaintiff having prima facie established its claim.
Final Decision
The Bombay High Court dismissed the Writ Petition, upholding the Trial Court's judgment dated 25.01.2024 granting unconditional leave to defend to the Respondent. No order as to costs.
Law Points
- Order XXXVII Rule 3(5) CPC
- Section 65B Indian Evidence Act
- 1872
- Section 12A Commercial Courts Act
- 2015
- Summary Suit
- Leave to Defend
- Triable Issues
