Shri Satish Kumar Sakuja v. M/s. Appolo Cranes Pvt. Ltd. & Ors.

14. In sum and substance, the case of the plaintiff is that the defendants have not refunded the balance amount paid by the plaintiff for purchasing 3rd crane which deal stood cancelled at the instance of defendants.

15. Accordingly, the plaintiff has claimed principal amount of Rs.1,17,40,406/-, besides interest accrued on the said amount for the period 15.03.2016 to 14.12.2017 at the rate of 18% per annum, which comes to Rs.36,98,228/-. The plaintiff has thus, prayed for recovery of total amount of Rs.1,54,38,634/- with pendente lite and future interest.

16. The defendants have filed the written statement. The stand taken by defendants with regard to the 1st crane and 2nd crane is that the plaintiff has only paid token money of Rs.10,00,000/- and 40,00,000/-, respectively, however, in respect of 4th crane, the case of the defendants is that they gave the said crane on hire basis to the plaintiff for working in the project at Bina Refinery, Madhya Pradesh and the plaintiff has also filed the invoice with regard to the same which shows that the hire charges for the same were Rs.45,00,000/- plus service tax, totalling to Rs.51,30,000/-.

17. Insofar as 3rd crane is concerned, the defendants in their written statement have denied any discussion about the sale or purchase of 3rd crane alleged in the plaint. In parawise reply, the defendants have stated that an amount of Rs.11,93,906/- alleged to have been paid by the plaintiff towards initial payment of 3rd crane was carry forward amount of the transactions for the financial year 2014-15, as the plaintiff and defendant company were having business transactions on regular basis. Further, the defendants have set up a case in the written statement that the crane which is being projected as 3rd crane is not actually the third crane, but a crane priced at Rs.71,13,750/- was purchased by the plaintiff from the defendants. It is alleged in the written statement that the invoice of the said crane is not traceable.

18. As regards 4th crane, the defendants in their written statement have denied that they failed to supply the said crane to the plaintiff. In para wise reply to para 11 of the plaint, the defendants have alleged that they gave 4th crane to the plaintiff on hire charges for working in the project at Bina Refinery, Madhya Pradesh. It is further averred that invoice in respect of said 4th crane is already placed on record by the plaintiff alongwith the plaint, wherefrom it is borne out that the hire charges for the said crane was Rs.51,30,000/- inclusive of service tax.

19. In the written statement, it is alleged that defendants have paid an amount of Rs.6,03,500/-; Rs.5,04,943/- and Rs.5,00,000/- to the plaintiff. It is further alleged that it is the plaintiff who was liable to pay Rs.2,03,444/to the defendants, and in discharge of the said liability, the plaintiff issued a cheque no.001076 for Rs.2,00,000, however, on presentation of the said cheque, it was returned unpaid with remarks ‘payment stopped by the drawer’.

20. After completion of pleadings, plaintiff filed the present application praying for summary judgment or in the alternative passing a conditional order, as noted hereinabove. The said prayer is predicated on the following:

(i) a joint document schedule has been filed by the parties, in which 45 documents filed by the plaintiff have been admitted by the defendants, which have been exhibited as Exhibit P-1 to P-45;

(ii) the defence taken by the defendants in the written statement that crane model link belt 718 [4th crane] which the defendants allege to have given to the plaintiff on hire basis for using it in the project at Bina Refinery, Madhya Pradesh is false, inasmuch as the said crane was neither hired nor sent by the defendants to Bina Refinery; and

(iii) the crane which the defendants claim to have been purchased by the plaintiff on 21.07.2015 for Rs.71,13,750/- against an invoice is also an incorrect fact as the defendants in support of their contention had not filed the invoice with their written statement.

21. Mr. Amit Sethi, learned counsel for the plaintiff submits that insofar as payment made by the plaintiff towards 3rd crane is concerned, the same has not been disputed by the defendants. To substantiate his submission Mr. Sethi has invited attention of the Court to the averments made with regard to the payment made for 3rd crane in paras 8, 9 and 13 of plaint, and the corresponding reply of the defendants in their written statement.

22. He further submits that in respect of the payment made by the plaintiff towards the consideration of 3rd crane, the categorical stand taken by the defendants in their written statement is that an amount of Rs.11,93,906/alleged to have been paid by the plaintiff as initial payment, was a payment towards carry forward amount of the transactions for the financial year 2014-15. Again, contradictory defence has been set up in the written statement, more particularly in para no. 9 of parawise reply thereof, asserting that the payments of Rs.11,93,906/-, Rs.8,00,000/- and Rs.25,00,000/- were made by the plaintiff as pre-payment of the cranes that the plaintiff hired for different refinery projects, but no details of such cranes or of alleged different refinery projects, have been stated in the written statement nor any document has been filed to establish the alleged fact.

23. He further contends that with regard to two further payments of Rs.40,04,984/- and Rs.28,50,000/- which were made by the plaintiff to the defendants towards the sale consideration of 3rd crane, the details of which have been mentioned in para 13 of the plaint, there is neither specific nor implicit denial of the same in parawise reply of the written statement, therefore, such averments shall be deemed to have been admitted.

24. He, therefore, reiterates that there is no denial of payments made by the plaintiff to the defendants in different tranches towards the sale consideration of 3rd crane. The only dispute raised is that the said payment was not towards the purchase of alleged 3rd crane, which defence is bereft of material particulars.

25. He submits that the 4th crane which the defendants claim to have given to the plaintiff on hire basis for the project at Bina Refinery, Madhya Pradesh, again, there is no document to suggest that any such crane was given to the plaintiff by the defendants. He submits that the invoice dated 29.06.2015 for an amount of Rs.51,30,000/- was issued in advance, but the same was not followed by actual handing over of crane. He submits that had such crane been actually hired and sent to Bina Refinery, Madhya Pradesh, the defendants would have deputed their operator to run the said crane and recorded the hours of working of such crane in the log-sheet, which is to be signed by the operator as well as Engineer-in-charge of the refinery. Only thereupon, an invoice could have been raised alongwith supporting documents, as has been done in past, as and when the cranes were actually hired by the plaintiff from the defendants. To buttress his contention Mr. Sethi has referred to the documents Exhibit P-4 to P-11.

26. He submits that the plaintiff had never entered into any transaction for the purchase of crane for Rs.71,13,750/- as alleged by the defendants. He contends that alongwith written statement, no invoice was placed on record by the defendants to establish the said transaction. He submits that the invoice dated 21.07.2015 for an amount of Rs.71,13,750/-, which has now been placed on record alongwith reply to the present application, is a manufactured document and the same has been fabricated to square up the account in respect of the payment made by the plaintiff for the purchase of 3rd crane worth Rs. 1.20 crores.

27. Mr. Sethi submits that the defendants have deliberately reflected in the ledger account of defendant no.1 the incorrect figures including the amount of aforesaid two invoices – one dated 29.06.2015 for an amount of Rs.51,30,000/-, and another dated 21.07.2015 for an amount of Rs.71,13,750/-, to falsely portray that the defendants are not liable to pay any amount to the plaintiff.

28. He submits that the defendants have no cogent and genuine defence of refuting receipt of advance payments and the defence put forth by defendants is sham, which is not substantiate by any cogent documentary evidence, therefore, there is no real prospect of the defendants to successfully defend the claim of the plaintiff or to prove on record the alleged sale of crane, which the defendants claim to be third crane, as well as, supply of 4th crane on hire basis, to the plaintiff.

29. He submits that there is no requirement of oral evidence. Further, there is no compelling reason which may prevent this Court from passing a summary judgment in favour of the plaintiff. He, therefore, urges the Court to pass a summary judgment in favour of the plaintiff and against the defendants thereby allowing the entire claim made in the suit.

30. Per contra, Mr. Ajit Kumar Gola, learned counsel for the defendants submits that nothing is due from the defendants to the plaintiff; rather an amount of Rs.2,03,444/- is due from the plaintiff to the defendants and in discharge of the said liability, plaintiff had issued a cheque no. 001076 for Rs.2,00,000/-. However, on presentation of the said cheque, the same was returned unpaid with remarks ‘payment stopped by the drawer’.

31. He submits that the third crane was in fact ‘used Tata 320-18 green colour crane’ which was sold by the defendants to the plaintiff for an amount of Rs.71,13,750/- for which invoice dated 21.07.2015 was issued. The said invoice could not be traced at the time of filing of written statement, therefore, it was not filed earlier. However, the details of the invoice find mention in the written statement, as well as, ledger account filed along with the written statement. He submits that now the said invoice has been traced and it has been filed with the reply to the application. Likewise, acknowledged copy of invoice of Rs.51,30,000/- dated 29.06.2015 in respect of 4th crane that was given on hire to the plaintiff has also been filed alongwith reply to the present application.

32. He submits that there was no alleged 3rd crane worth Rs. 1.20 crores sold to the plaintiff by the defendants; rather it was ‘used Tata crane’ which was sold at a price of Rs.71,13,750/-.

33. He further submits that it is incorrect on part of the plaintiff to contend that 4th crane intended to be taken on hire was never sent to Bina Refinery by the defendants. He submits that said 4th crane was given on hire as per the oral request and agreement between the parties. Further, there is no attempt on part of the defendants to square up the account by issuing aforesaid two invoices. The said invoices were issued on 29.06.2015 and 21.07.2015, much prior to the dispute now sought to be raised by the plaintiff. He thus, urges that trial and oral evidence is necessary to bring forth the correct facts on these issues.

34. He further submits that with regard to 4th crane given to the plaintiff on hire basis as per agreement, there was no need for raising any invoice according to log-sheets etc. He submits that the procedure referred to by the plaintiff is based on a general condition and not applicable to the present case. He submits that since the plaintiff had approached for hiring of 4th crane for being used in refinery, it was incumbent on part of the plaintiff to maintain the record including the alleged gate pass and the alleged entry pass receipt of each and every State through which the crane had passed for reaching the destination. Elaborating further, he submits that there was no question of preparing a log-sheet for 4th crane as according to the agreement between the plaintiff and the defendants, the crane was to be used as per the requirement of the plaintiff.

35. Insofar as the plaintiff’s argument that the defendants have admitted the documents, Mr. Gola submits that out of 45 documents filed by the plaintiff, 11 documents on which the plaintiff has based its claim, have been denied by the defendants. With regard to Ex. P-28 [covering letter alongwith debit note dated 20.01.2016], Ex. P-33 [legal notice dated 20.02.2016 plaintiff] and Ex. P-39 [letter dated 31.08.2017 sent by plaintiff to defendant no.1] are concerned, he submits that the defendants have only admitted the receipt of said documents, however, the contents of the same have been denied. He further submits that all the payments including that of Rs.8,00,000/- and Rs.25,00,000/- were only part payments made towards composite amount of sale and hiring of cranes.

36. He submits that from the sale invoice of crane for an amount of Rs.71,13,760/- as well as service tax invoice of 4th crane it is clear that defendants have a genuine defence and there is every likelihood of them succeeding in defending the claim. He further submits that since there are disputed questions of fact involved, the same need to be put to trial and accordingly, recording of oral evidence is imperative.

37. He denies that there are no compelling reasons which may prevent passing a summary judgment in favour of the plaintiff. He, therefore, urges the Court that the application of the plaintiff be dismissed.

38. I have heard the learned counsel for the parties.

39. The claim in the suit is for recovery of principal amount of Rs. 1,17,40,406/- paid on account of advance payment for purchase of 3rd crane alongwith interest amount of Rs. 36,98,228/- on the principal amount calculated @ 18% per from 15.03.2016 till 14.12.2017 with further prayer for pendente lite and future interest @ 18% per annum till realization.

40. The case of the plaintiff is that he had made following payments to the defendants in different tranches: (i) Rs.11,93,906/- [in the first quarter of calendar year 2015]; (ii) Rs.8,00,000/- [April, 2015]; (iii) Rs. 25,00,000/- [April, 2015]; (iv) Rs.40,04,984 [cheque dated 11.08.2015]; and (v) Rs, 28,50,000/- [cheque dated 07.09.2015].

41. It is alleged by the plaintiff that due to unavoidable circumstances as informed by the defendants, the 3rd crane was not sold by the defendants to the plaintiff and it was assured that entire advance payment received by the defendants shall be refunded at the earliest. Out of the said advance payment, the defendant no.1 repaid an amount of Rs.5,04,984/- and Rs.5,00,000/- vide cheques dated 16.09.2015 and 07.10.2015, respectively. The averments in this regard have been made by the plaintiff in paras 8, 9, 13 and 14 of the plaint, which reads as under: ―8 That during the tenure when the plaintiff was making payment of said two cranes to defendant No. 1, defendant No. 2 again approached the plaintiff in the last week of February, 2015 and further insisted that yet another relatively new crane i.e. third crane owned by defendant No[1]. bearing Model No. SANY Make (Chinese) having declared capacity of 75 ton is available for Sale at cheap rate of Rs. 1.20,00,000/- (Rupees One Crore Twenty Lakhs Only). The defendants specially defendant No.2 time and again met the plaintiff at his office and also called the plaintiff at his office at Tilak Nagar, New Delhi and kept on inducing the plaintiff to purchase the said third crane also. In one of such meetings, the defendants No. 3 & 4 besides defendant No. 2 were also present and they together persuaded the plaintiff to purchase the said third crane after telling the plaintiff about its strength durability and viability. Being influenced by such persistent inducement and above all, since the plaintiff was having utmost faith on defendants, plaintiff agreed to purchase the third crane also. It was also represented by defendants that there is a lien/loan against said third crane and the same is required to be cleared before taking delivery of the said crane. Thus, as such, plaintiff also agreed to clear the said lien/loan in nutshell, the plaintiff during the months of January, 2015 to 30.03.2015 cleared the total sale price of aforesaid two cranes besides making payment of Rs 11,93,906/towards initial payments towards the third crane.

9. That the plaintiff in furtherance of commitment of purchasing the third crane made further payment of Rs. Eight Lacs and yet another payment of Rs 25 Lacs during the month of April, 2015. xxxxx xxxxx xxxxx xxxxx

13. That the plaintiff in order to fructify the deal of third crane bearing Model No. SANY Make (Chinese) made further payment in sum of Rs. 40,04,984/- vide cheque No 001079 on 11.08 2015 and yet another payment of Rs 28,50,000/- vide cheque No. 001077 dt. 07.09.2015. Said cheques on presentation were duly encashed in the account of defendant No 1 and thus in such manner, the plaintiff has made substantial payment for purchase of third crane from the defendant No. 1.

14. That on 12.09.2015, defendant No.2 for and on behalf of defendant No 1 informed the plaintiff that due to certain unavoidable circumstances, defendant(s) are not in a position to sell the third crane to plaintiff and assured the plaintiff that entire advance payment so received by defendant(s) shall be refunded/returned back to plaintiff at the earliest by it/them. Needless to mention, on such promise and in partial discharge of such liability, the defendant No. 1 made payment of Rs 5,04,984/vide cheque No 002416 dt. 16.09.2015 and another part payment of Rs 5,00,000/- vide cheque No 002463 dt. 07.10.2015 to the plaintiff. However, thereafter, the defendant(s) did not make any payment to return the balance amount withheld by defendants which amount was paid by plaintiff to defendant(s) with an intention of purchasing the third crane.‖ (emphasis supplied)

42. The plaintiff has also admitted having received an amount of Rs.6,03,500/- from defendants for paying the EMI of loan.

43. The defendants in their written statement have not denied the payment made by the plaintiff, which the plaintiff claims to have been made towards the consideration of 3rd crane. The para wise reply of paras 8, 9, as well as para wise reply of paras 13 and 14, which has been compositely replied in paras 11-22 of the written statement, reads as under: ―8.That the contents of para 8 of the present plaint are wrong, false and hence denied. It is denied that the Defendants ever insisted or ever discussed about the sale or purchase of any Chinese Crane bearing Model No. SANY having capacity of 75 tons. In reply to the present para it is submitted that no Invoice has ever been raised towards Sale/Purchase of Third Crane (SANY Chinese Make). Further, it is pertinent to mention that the amount of Rs. 11,93,906/- was a carry forward amount of the transactions for the Financial Year 2014-15, as the Plaintiff and the Defendant Company were having family like relations and having business transactions on regular basis.

9. That the contents of the para 9 of the present plaint are denied in toto. In reply to the present para it is submitted that the payment of Rs. 11,93,906/-, Rs. 8,00,000/-, and Rs. 25,00,000/- was made by the Plaintiff as a pre-payment of the Cranes that the Plaintiff hired for different Refinery projects. xxxx xxxx xxxx 11-22 That the contents of the paras 11 to 22 of the present plaint, except matter of record, are wrong, false and hence denied. It is denied that the Defendants failed to supply the crane to the Plaintiff. It is pertinent to submit here that the Respondent Company strives to provide efficient and high quality services to its clients, carrying out all operations in a safe and professional environment and it is one of the leading crane rental and trading giants in India. The Respondent Company was founded and established in 1988 by Shri Arun Mahajan, who has over 35 years of experience and knowledge in the field of crane hiring and trading in the South- East Asian market. The Respondent Company has over 100 dedicated, highly skilled employees. The Defendant Nos.[2] to 4 are the Directors of the Defendant No.l, who are not personally liable for the debts of the Defendant No.1Company, if any. The parties herein are known to each other and the Plaintiff and Defendant No. 1 had many business transactions prior to the alleged transactions in the Plaint herein. In this regard, it is pertinent to submit here that in fact, the Defendant No.1 Company was providing cranes to the Plaintiff on hire basis. Thus, the Parties were enjoying trustworthy relationship with each other. Between the period 2010-11, the Plaintiff approached the Defendant Company and after mutual discussions and deliberations between the parties, the Plaintiff agreed to take on lease and the Answering Defendants agreed to give on lease cranes to the Plaintiff herein. This is an admitted case of the Plaintiff herein. It is pertinent to submit here that on 28.02.2015, the Plaintiff purchased the crane from the Defendants, for which the Defendants raised the Invoice No. Sale / 2014-15 / Oil for Rs. 1,94,25,000/-. It is pertinent to submit here that on 29.01.2015, the Plaintiff admittedly paid Rs.40,00,000/- as earnest money / token money to the Answering Defendants for buying the first crane from the Answering Defendants. It is submitted that on 05.03.2015, the Plaintiff purchased the second crane from the Defendants, for which the Defendants raised the Invoice for Rs.2,21,00,000/-. It is pertinent to submit here that on 02.03.2015, the Plaintiff admittedly paid Rs.10,00,000/- as earnest money / token money to the Answering Defendants for buying the second crane from the Answering Defendants. In the meanwhile, the Plaintiffs approached the Answering Defendants stating that since he earned huge profits out of the aforesaid cranes, therefore, he would purchase one more crane from the Answering Defendants besides taking cranes on hire basis in view of the fact that the Plaintiff was hopeful of getting some good contract in Madhya Pradesh. As such, the Plaintiff started making advance payments to the Answering Defendants, as shown in the Statement of Account filed along with the present Written Statement. As per the mutual understanding and agreement between the parties, from April, 2015, the Answering Defendants gave on hire the Crane Make Link Belt 718 to the Plaintiff for working in the Project at Bina Refinary Madhya Pradesh. The Invoice in respect of the aforesaid hired Crane is already placed on record of this Hon'ble Court by the Plaintiff (which is at page no.232 of the Paper Book of the Plaint). It is pertinent to submit here that admittedly, the hire charge for the said crane was for Rs.45,00,000/- plus service tax and thus totaling to Rs,51,30,000/-, as shown in the statement of account. It is pertinent to submit here that on 21.07.2015, the Plaintiff herein purchased the third Crane from the Answering Defendants for Rs.71,13,750/-. The Invoice of the third Crane is not readily available with the Answering Defendants, therefore, they are craving leave of this Hon'ble Court to file the same later on. Since the Bank EMls payable by the Plaintiff to the Banks were bounced, therefore, in the month of July, 2015, the Plaintiff approached the Answering Defendants and requested for money. Accordingly, admittedly, Rs.6,03,500/- on 28.07.2015, Rs.5,04,984/- on 16.09.2015 and Rs.5,00,000/- on 07.10.2015 were given by the Answering Defendants to the Plaintiff. As on 04.11.2015, the Plaintiff was liable to pay Rs.2,03,444/- to the Defendants and in discharge of his liability towards the Defendant, the Plaintiff issued the cheque no.001076 for Rs.200,000/-, however, on presentation of the said cheque, the said was returned with the remarks "Payment Stopped by the Drawer". Thereafter, the Plaintiff approached the Defendants and the entire matter was settled between the parties. The Plaintiff has thus deposed false facts on Affidavit before this Hon'ble Court and as such, he has committed offence of perjury. All the pleas, contentions, statements and allegations made by the Plaintiff in the Suit are totally false to his own knowledge. It is unambiguous and clear that the Plaintiff has taken recourse of falsehood, fraud, concoctions and fabrications. The Suit is therefore liable to be dismissed.‖

44. A juxtaposed reading of the above quoted pleadings from the plaint and the written statement shows that there is no specific or implicit denial of payments made by the plaintiff towards the consideration of 3rd crane, though the defendants have denied any discussion about the sale or purchase of the 3rd crane. Further reading of above quoted paragraphs from the written statement also makes it apparent that the defendants have taken contradictory stand in paras 8 and 9 of para wise reply of the written statement, inasmuch as in para 8 the defendants have stated that an amount of Rs.11,93,906/- was paid by the plaintiff, against a carry forward amount of the transactions for the financial year 2014-15, but in para 9 somewhat different stand has been taken that the said amount was paid by the plaintiff as pre-payment of the cranes that the plaintiff hired for different refinery projects.

45. Likewise, the stand taken with regard to other two payments i.e. of Rs. 8,00,000/- and Rs. 25,00,000/- is that the same were also made as a prepayment of the cranes hired by the plaintiff for different refinery projects.

46. Intriguingly, neither the details of the cranes for which such prepayment was made, nor the details of alleged different refinery projects, have been spelled out in the written statement. Further, the written statement is conspicuously silent about the other two payments of Rs.40,04,984/- and Rs.28,50,000/- stated to have been made by the plaintiff vide two separate cheques, as alleged in para 13 of the plaint. Clearly, there is no denial of the payments made by the plaintiff towards 3rd crane as detailed in para 8, 9 and 13 of plaint.

47. The defendants, however, in their written statement have set out a defence that they had given two other cranes to the plaintiff. One crane being crane model link belt 718 (4th crane) was given on hire to the plaintiff for his project at Bina Refinery, Madhya Pradesh in respect of which the invoice of Rs.51,30,000/- was raised. The other crane was given by the defendants to the plaintiff by way of an outright sale, in respect of which invoice of Rs.71,13,750/- was raised. The invoice of Rs.51,31,000/- had been filed by the plaintiff with the plaint whereas with regard to the invoice of Rs.71,13,750/- the defendants had stated that the same is not readily available.

48. Accordingly, it is alleged in the written statement that as on 04.11.2015, it is the plaintiff who was liable to pay Rs.2,03,444/- to the defendants and in discharge of his liability towards defendants, the plaintiff issued a cheque no. 001076 for Rs.2,00,000/-, however, on presentation, the said cheque was returned unpaid with remarks ‘payment stopped by the drawer’.

49. Insofar as the invoice of Rs.51,30,000/- dated 29.06.2015 is concerned, the plaintiff in the plaint has taken a stand that the said invoice was issued in advance and on the basis of said invoice, a wrong entry was entered in his accounts without any crane being supplied by the defendants, but on being pointed out by the auditor, a debit note of Rs.51,30,000/- dated 20.01.2016 was issued by the plaintiff to the defendants alongwith a covering letter. Para 16 of the plaint is reproduced hereinbelow for ready reference: ―16. That as per regular practice, internal audit of the accounts of plaintiff for the period 01.04.2015 to 30.09.2015 was conducted by the Auditors of the Plaintiff on 15.12.2015 and in the Audit Report dt 11.01.2016, certain lapses, irregularities and wrong entries in the Books of Account of plaintiff were highlighted inter-alia showing that entry in sum of Rs. 51,30,000/- has been wrongly shown as credit to Defendant No 1, while no such crane was ever actually hired by plaintiff nor supplied by defendant No 1. As such, on the advice of internal Auditor in regard to wrongful entry of Invoice for a sum of Rs.51,30,000/- was debited and accordingly Debit Note dt. 20.01.2016 was issued to defendants alongwith a Covering Letter. Needless to mention, said Letter and the Debit Note was duly received by defendants by all modes of service whereby the plaintiff clarified that earlier demanded amount of Rs 69,10,406/- was not correct as the wrong entry of Rs. 51,30,000/- was not in the knowledge of plaintiff and the same came to his knowledge only after internal audit carried out by his Auditor and after their Report dt. 11.01.2016.‖

50. A perusal of para-wise reply of paras 11-221 in the written statement, which contains response to para 16 of the plaint, shows there is no denial by the defendants with regard to the issuance of debit note as well as specific averments made by the plaintiff in respect thereof. Further, apart from the invoice of Rs.51,30,000/- dated 29.06.2015, no other document has been filed by the defendants to establish that any such crane was actually hired by the plaintiff from the defendants. A comparative reading of the said invoice with other invoices placed on record by the plaintiff in respect of hiring of cranes on earlier occasions shows that such earlier invoices[2] specifically refer to the log sheets as well as hourly or per day rates for use of such cranes, besides the registration number of the cranes, which is conspicuously missing in the aforesaid invoice dated 29.06.2015.

51. A copy of invoice dated 29.06.2015 filed by the defendants alongwith their reply to the present application, though, shows that it bears the signatures of the plaintiff, but prima facie the same at the best could be taken as an acknowledgment of the invoice, and in the absence of other quoted in para 43 of this judgment. Filed with the plaint. contemporaneous documents in the form of log-sheets, registration certificate, acknowledgement of actual delivery of crane etc., the defence of the defendants appears to be highly improbable.

52. Likewise, the defence to the effect that the plaintiff had purchased ‘used Tata 320-18 green colour crane’ priced at Rs.71,13,750/- also appears to be highly improbable for various reasons. Firstly, the invoice dated 21.07.2015 with regard to this crane was not filed by the defendants alongwith their written statement, the same saw light of the day when it was filed by the defendants alongwith their reply to the present application. Secondly, a perusal of said invoice shows that there is no acknowledgement of the said invoice by the plaintiff unlike invoice dated 29.06.2015. Thirdly, no document has been placed on record by the defendants to establish that said crane was actually delivered to the plaintiff by the defendants. Fourthly, no registration certificate of the said crane is forthcoming unlike other cranes sold by the defendants to the plaintiffs in respect of which such registration certificate has been placed on record by the plaintiff.

53. Clearly, the defence articulated by the defendants in their written statement is sketchy and bereft of details, which remains unsubstantiated by any cogent and unimpeachable material, making the same improbable.

54. However, at the same time it cannot be overlooked that the business transactions of sale, purchase and hiring of cranes between plaintiff and the defendants dates back to the year 2011 and various transactions have taken place between them. Also, the two invoices relied upon by the defendants are tax invoices. Further, the case of the plaintiff that he had entered into a transaction for purchase of 3rd crane is not substantiated by any document. The defendants in their written statement have also alleged that the entire matter was settled between the parties after payment of Rs.2,00,000/- by the plaintiff vide its cheque no. 001076 of Rs.2,00,000/-, which was returned unpaid by the plaintiff’s banker on presentation but, the plaintiff has denied the factum of issuance of said cheque in discharge of his liability. Incidentally, it is averred in the replication that said cheque was given by the plaintiff towards security for release of original documents pertaining to purchase of 1st and 2nd crane and since the defendants failed to handover the said documents, the payment of said cheque was stopped. Therefore, the question whether said cheque was given by the plaintiff towards discharge of his liability in full, is a disputed question. These factors give an impression that there are triable issues and the defence raised by the defendants may succeed, though the probability of the same seems to be remote.

55. Therefore, in the given circumstances, the question that would arise is as to what directions needs to be passed in the present application. At this juncture, reference to relevant provisions of Order XIIIA of the CPC, as applicable to commercial dispute is apposite. The relevant part of order XIIIA of CPC reads as under: ―ORDER XIII-A Summary Judgment

3. Grounds for summary judgment.—The Court may give a summary judgment against a plaintiff or defendant on a claim if it considers that–– (a) the plaintiff has no real prospect of succeeding on the claim or the defendant has no real prospect of successfully defending the claim, as the case may be; and (b) there is no other compelling reason why the claim should not be disposed of before recording of oral evidence.

6. Orders that may be made by Court.- (1) On an application made under this Order, the Court may make such orders that it may deem fit in its discretion including the following:- (a) judgment on the claim; (b) conditional order in accordance with Rule 7 mentioned hereunder;

(c) dismissing the application;

(d) dismissing part of the claim and a judgment on part of the claim that is not dismissed; (e) striking out the pleadings (whether in whole or in part); or (f) further directions to proceed for case management under Order XV-A. (2) Where the Court makes any of the orders as set forth in subrule (1) (a) to (f), the Court shall record its reasons for making such order.

7. Conditional order.-(1) Where it appears to the Court that it is possible that a claim or defence may succeed but it is improbable that it shall do so, the Court may make a conditional order as set forth in Rule 6 (1)(b). (2) Where the Court makes a conditional order, it may:- (a) make it subject to all or any of the following conditions:-

(i) require a party to deposit a sum of money in the Court;

(ii) require a party to take a specified step in relation to the claim or defence, as the case may be;

(iii) require a party, as the case may be, to give such security or provide such surety for restitution of costs as the Court deems fit and proper;

(iv) impose such other conditions, including providing security for restitution of losses that any party is likely to suffer during the pendency of the suit, as the Court may deem fit in its discretion; and (b) specify the consequences of the failure to comply with the conditional order, including passing a judgment against the party that have not complied with the conditional order.‖

56. A coordinate bench of this Court in Su-Kam Power Systems Limited vs. M/s Kunwer Sachdev and Anr., (2019) SCC OnLine Del 10764 dealt with the procedural requirements for passing summary judgment under order XIIIA of CPC. It was observed that Rule 3 of Order XIIIA CPC, as applicable to commercial disputes, empowers the Court to grant summary judgment against the defendants where Court considers that two conditions are satisfied viz., – (i) the defendant has no real prospect in successfully defending against the claim, and (ii) there is no other compelling reason that the claim should not be disposed of before recording of oral evidence. The relevant excerpts of the said decision read thus: “91. Rule 3 of Order XIIIA, CPC, as applicable to commercial disputes, empowers the Court to grant a summary judgement against the defendant where the Court considers that the defendant has no real prospects of successfully defending the claim and there is no other compelling reason why the claim should not be disposed of before recording of oral evidence. The expression “real” directs the Court to examine whether there is a “realistic” as opposed to “fanciful” prospects of success. This Court is of the view that the expression ―no genuine issue requiring a trial‖ in Ontario Rules of Civil Procedure and ―no other compelling reason…..for trial‖ in Commercial Courts Act can be read mutatis mutandis. Consequently, Order XIIIA, CPC would be attracted if the Court, while hearing such an application, can make the necessary finding of fact, apply the law to the facts and the same is a proportionate, more expeditious and less expensive means of achieving a fair and just result.‖

57. However, when the twin test as laid down in Rule 3 of Order XIIIA of CPC is not satisfied, the Court may pass a conditional order in terms of Rule 6(1)(b) read with Rule 7 of Order XIIIA instead of passing a judgment on the claim, where it appears to the Court that it is possible that a defence of the defendant may succeed but it is improbable that it shall do so.

58. The conditional order could be in the nature of requiring a party to deposit a sum of money in the Court; or to take a specified step in relation to the claim or defence, as the case may be; or to give such security or surety for restitution of cost as the Court deems fit and proper; and specify the consequences of the failure to comply with the conditional order, including passing a judgment against the party that have not complied with the conditional order.

59. At this stage reference to a decision of the Division Bench of Madras High Court in Syrma Technology Private Limited vs. Powerwave Technologies Sweden AD (in bankruptcy), 2020 SCC OnLine Mad 5737 would be apposite. In the said case, the learned Single Judge granted a decree in part on an application seeking a summary judgment. However, the Division Bench set aside the decision of the learned Single Judge and passed the conditional order under Order XIII A Rule 7 CPC, observing as under: ―19. This rule provides sufficient power to the Court to pass a conditional order. This power has to be exercised when “it appears” to the Court that it is possible that a claim or defence may succeed but it is improbable that it shall do so. If we read order XIII-A Rules 6 and 7 together, a clear picture would emerge. If it appears to the Court that a claim or defence may succeed and it is also probable, then the application filed seeking a summary judgment will have to be dismissed. If it appears to the Court that it is possible but improbable as stated in Rule 7 of Order XIII-A of the Act, then it may consider passing a conditional order. If the Court considers that a plaintiff has no real prospect of succeeding on the claim or the defendant has no real prospect of successfully defending the claim, there is no other compelling reason as to why the claim should not be disposed of before recording of oral evidence, it may give a summary judgment. Alternatively, the Court can also consider striking out the pleadings either in whole or in part. This discretion is given to the Court before deciding to give a summary judgment. Therefore, the Court has to keep in mind and decide as to whether it is a fit case for striking out the pleadings dismissing an application and proceed further or a conditional order could be passed. After exhausting these stages, the question of granting a summary judgment would arise.

20. Thus, to conclude, we are of the view that when an application is filed under Order XIII-A, a Court is expected to keep in mind the provisions contained in Order XIII-A Rules 6 and 7 before considering a summary judgment under Order XIII-A Rule 3. We are conscious that Order XIII-A Rule 6 also speaks of a judgment on the claim both part or full. Order XIII-A Rule 7 read with other modes mentioned under Order XIII-A Rule 6 act as contraceptive to grant of summary judgment under Order XIII-A Rule 3. xxx xxx xxx

48. From the submissions made and after going through the relevant records, the judgments produced and on perusing the judgments and appeal, we feel that it appears that there is a possibility of the defendant becoming successful though it is improbable that it shall do so. Hence, the case on hand would come under Order XIII-A Rule 7 warranting a conditional order. We may note that the learned single Judge has not considered this aspect.

49. We further find that there are triable issues in the suit. The first respondent itself earlier filed only an application seeking a direction to furnish security. This was filed on 04.01.2017. Only thereafter, application in O.A. No. 7113 of 2018 in C.S. No. 851 of 2015 has been filed on 24.07.2018 after 1 ½ years. Factually there is a deviation from the purchase order with respect to the place of supply made. Therefore, even on that ground, it would be the case, which would come under Order XIII-A Rule 7. In such view of the matter, while setting aside the judgment and decree of the Commercial Division, there shall be a conditional order that the appellant shall deposit a sum of Rs. 2.[8] crores (Rupees two crores and eighty lakhs only) to the credit of the suit in C.S. No. 851 of 2015 in the name of the Registrar General, High Court, Madras- 600 104, in an interest bearing deposit within a period of four weeks from the date of receipt of a copy of this judgment. We may request the learned single Judge to consider by issuing further directions to proceed for case management under Order XV-A. Accordingly, the Judgment and decree of the Commercial Division stands set aside and the Original Side Appeal stands allowed in part. Consequently, connected civil miscellaneous petition is closed. We make it clear that in the event of non compliance of the order aforesaid, the judgment and decree of the learned single Judge would get restored.‖

60. Likewise, reference may also be advantageously made to a decision of another Coordinate Bench of this Court in Ozone Spa Pvt. Ltd. vs. Jyotsna Sanjay Aggarwal and Another, 2021 SCC OnLine Del 4047, wherein it has held as under: ―41. Rule 7(1) of Order XIIIA provides that where it appears to the court that it is possible that a defence may succeed but it is improbable that it should do so, the court can: make a conditional order which includes a direction to deposit money in court; direction to the defendant to take specified steps in his/her defence; direction to furnish security or to provide surety for restitution of cost as deemed fit and proper, or even impose such other condition including providing security for restitution of losses that any party is likely to suffer during the pendency of the suit as may be deemed fit in the discretion of the court.

42. Therefore, the court can inter alia either pass a judgement and decree in terms of the claim(s) made in the application or dismiss the application or issue a conditional order of the kind provided in Rule 7(2) of Order XIIIA.

43. In other words, if the reply raises triable issues then the court would be empowered to dismiss the application for summary judgment. Where, however, the court concludes that a claim or defence may succeed but it is improbable, the court is empowered to pass a conditional order. [See Rule 7(1) and Rule 6(1)(b) Order XIIIA of CPC.] The kind of conditional order that the court can pass is outlined in Rule 7(2)(a)(i) to (iv) of Order XIIIA of the CPC. Under Rule 7(2)(b) of Order XIIIA, the court can also specify consequences of the failure to comply with the conditional order including passing a judgment against the party that fails to comply with it.‖

61. A coordinate bench of this Court in Amanpreet Kohli vs. Pankaj Dayal, 2023 SCC OnLine Del 1808, after finding that while the defence raised by the defendant may succeed, however, it appears to be highly improbable to do so, had passed a conditional order directing the defendants therein to deposit a disputed sum. The Court also noted the decision of the Hon’ble Supreme Court in IDBI Trusteeship Services Ltd. vs. Hubtown Ltd., (2017) 1 SCC 568 rendered in the context of Order XXXVII CPC wherein the Court had reiterated the guidelines for granting to defend unconditionally and conditionally, or for refusing the same. The relevant paras of Amanpreet Kohli (supra) reads thus:

―17. Accordingly, the principles stated in para 8 of Mechelec case [Mechelec Engineers & Manufacturers v. Basic Equipment Corpn., (1976) 4 SCC 687] will now stand superseded, given the amendment of Order 37 Rule 3 and the binding decision of four Judges in Milkhiram case [Milkhiram (India) (P) Ltd. v. Chamanlal Bros., AIR 1965 SC 1698: (1966) 68 Bom LR 36], as follows:

17.1. If the defendant satisfies the court that he has a substantial defence, that is, a defence that is likely to succeed, the plaintiff is not entitled to leave to sign judgment, and the defendant is entitled to unconditional leave to defend the suit.

17.2. If the defendant raises triable issues indicating that he has a fair or reasonable defence, although not a positively good defence, the plaintiff is not entitled to sign judgment, and the defendant is ordinarily entitled to unconditional leave to defend.

17.3. Even if the defendant raises triable issues, if a doubt is left with the trial Judge about the defendant's good faith, or the genuineness of the triable issues, the trial Judge may impose conditions both as to time or mode of trial, as well as payment into court or furnishing security. Care must be taken to see that the object of the provisions to assist expeditious disposal of commercial causes is not defeated. Care must also be taken to see that such triable issues are not shut out by unduly severe orders as to deposit or security.

17.4. If the defendant raises a defence which is plausible but improbable, the trial Judge may impose conditions as to time or mode of trial, as well as payment into court, or furnishing security. As such a defence does not raise triable issues, conditions as to deposit or security or both can extend to the entire principal sum together with such interest as the court feels the justice of the case requires.

17.5. If the defendant has no substantial defence and/or raises no genuine triable issues, and the court finds such defence to be frivolous or vexatious, then leave to defend the suit shall be refused, and the plaintiff is entitled to judgment forthwith.

17.6. If any part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit, (even if triable issues or a substantial defence is raised), shall not be granted unless the amount so admitted to be due is deposited by the defendant in court.

35. In view of the above discussion, I find that while the defence raised by the defendant may succeed, however, it appears to be highly improbable to do so.

36. Accordingly, exercising powers under Rule 6(1)(b) read with Rule 7 of Order XIIIA of the CPC, as applicable to „commercial dispute‟, the defendant is directed to deposit a sum of Rs. 4,50,00,000/- as was mentioned in the alleged Loan Agreement to be payable by the defendant, in Court, within a period of four weeks of this order, failing which the defence of the defendant shall stand closed and the plaintiff shall be entitled to a decree of the amount claimed. In case, the defendant deposits the amount in compliance with this order, the Registry is directed to invest it in an interest bearing fixed deposit for a period of one year with automatic renewal.‖

62. On appreciation of overall conspectus, it cannot be said that the twin conditions as laid down in Rule 3 of Order XIIIA CPC are satisfied, warranting passing a judgment on the claim without recording of oral evidence, however, the present case is the one where it appears that it is possible that the defence of the defendants may succeed but it is improbable that it shall do so, therefore, it is appropriate to pass a conditional order.

63. Accordingly, at this stage, this Court deems fit to direct the defendants to deposit in the Court an amount of Rs.97,40,406/-3 within a period of six weeks of this order, in default of which, the defence of the defendants shall stand closed, and the plaintiff shall be entitled to the decree of the amount claimed. Ordered accordingly.

64. In the event the defendants deposit the amount as directed, the same be kept in an interest bearing fixed deposit, initially for a period of one year, on an auto renewal mode.

65. The application is disposed of in the above terms.

VIKAS MAHAJAN, J JULY 03, 2025 aj/N.S. ASWAL [Rs. 1,13,48,890 (payment received by the defendants) minus (Rs. 5,04,984 + Rs.5,00,000/- payment admittedly received by the plaintiff from the defendants) + Rs.6,03,500/- (payment made by defendant no.1 to enable the plaintiff to clear his EMI) ].