Bombay High Court Grants Unconditional Leave to Defend in Commercial Summary Suit for Recovery of Goods Sold — Triable Issues Raised Regarding Quality and Rejection of Goods. The court held that where the defendant raises a triable issue, unconditional leave to defend must be granted, and the plaintiff cannot obtain a decree without trial.

High Court: Bombay High Court Bench: BOMBAY In Favour of Accused
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Case Note & Summary

The plaintiff, Shree Pushkar Chemicals & Fertilizers Ltd., filed a Commercial Summary Suit against the defendant, Huntsman (International) India Pvt. Ltd., claiming a sum of Rs. 7,96,94,113 for goods sold and delivered, including H-Acid, K-Acid, and Vinyl Sulphone, under purchase orders issued from December 24, 2015. The plaintiff alleged that the defendant failed to pay for the goods despite delivery and invoices. The defendant entered appearance and filed an affidavit seeking unconditional leave to defend, contending that the goods were of substandard quality and were rejected, and that the plaintiff had agreed to replace the goods. The plaintiff filed a rejoinder and the defendant a sur-rejoinder. The court considered the principles governing leave to defend in summary suits under Order 37 of the Code of Civil Procedure, 1908. The court found that the defendant had raised triable issues regarding the quality of goods and the alleged agreement to replace them, which could not be decided without a trial. Accordingly, the court granted unconditional leave to defend, allowing the defendant to contest the suit on merits. The court directed the defendant to file a written statement within four weeks and set the suit for trial.

Headnote

A) Civil Procedure - Summary Suit - Leave to Defend - Order 37 of the Code of Civil Procedure, 1908 - Unconditional Leave - The defendant sought unconditional leave to defend a summary suit for recovery of price of goods sold and delivered, raising triable issues regarding the quality of goods and their alleged rejection. The court held that where the defendant raises a triable issue, unconditional leave to defend must be granted, and the plaintiff cannot obtain a decree without trial. (Paras 1-10)

B) Commercial Law - Sale of Goods - Quality Dispute - Rejection of Goods - The defendant contended that the goods supplied were of substandard quality and were rejected, and that the plaintiff had agreed to replace them. The court found that these contentions raised triable issues and could not be decided in a summary manner. (Paras 5-10)

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Issue of Consideration

Whether the defendant is entitled to unconditional leave to defend the summary suit on the ground that there are triable issues regarding the quality and rejection of goods supplied.

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Final Decision

The court granted unconditional leave to the defendant to defend the suit. The defendant is directed to file a written statement within four weeks. The suit is set down for trial.

Law Points

  • Summary suit
  • unconditional leave to defend
  • triable issues
  • Order 37 CPC
  • Commercial Court
  • leave to defend principles
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Case Details

2017:BHC-OS:13081

Summons for Judgment No. 77 of 2016 in Commercial Summary Suit No. 53 of 2016

2017-10-13

S.J. Kathawalla, J.

2017:BHC-OS:13081

Mr. Dinyar Madon, Senior Advocate, along with Mr. Nilesh Tated and Ms. Ankita Agrawal, instructed by M/s. DSK Legal, for the Plaintiff. Mr. N.H. Seervai, Senior Advocate, along with Mr. Dipankar Bandopadhya and Ms. Priyanka Devgan, instructed by Mr. Gandhar Raikar, for the Defendant.

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Nature of Litigation

Commercial Summary Suit for recovery of price of goods sold and delivered.

Remedy Sought

Plaintiff sought a decree for Rs. 7,96,94,113 with interest at 18% p.a. and costs.

Filing Reason

Defendant failed to pay for goods supplied under purchase orders.

Issues

Whether the defendant is entitled to unconditional leave to defend the summary suit on the ground that there are triable issues regarding the quality and rejection of goods supplied.

Submissions/Arguments

Plaintiff argued that the goods were supplied as per purchase orders and invoices, and the defendant is liable to pay the amount. Defendant contended that the goods were of substandard quality, were rejected, and the plaintiff agreed to replace them, raising triable issues.

Ratio Decidendi

In a summary suit under Order 37 CPC, if the defendant raises a triable issue, unconditional leave to defend must be granted. The court cannot decide disputed questions of fact in a summary manner.

Judgment Excerpts

The Plaintiff has filed the above Commercial Summary Suit claiming a sum of Rs. 7,96,94,113... The Defendant filed an Affidavit seeking unconditional leave to defend the Summary Suit.

Procedural History

Plaintiff filed Commercial Summary Suit No. 53 of 2016. Defendant entered appearance. Plaintiff took out Summons for Judgment No. 77 of 2016. Defendant filed affidavit seeking unconditional leave to defend. Plaintiff filed rejoinder, defendant filed sur-rejoinder. Court heard arguments and reserved judgment on 31st January 2017, pronounced on 13th October 2017.

Acts & Sections

  • Code of Civil Procedure, 1908: Order 37
  • Companies Act, 1956:
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