The Hon’ble Supreme Court on 15thJuly 2019, in the matter of Sudin Dilip Talaulikar v. Polycap Wires Pvt. Ltd. and Others, observed that withdrawal of criminal prosecution is no bar to the maintainability of a summary suit in a cheque bounce case.
The fact that there may have been a commercial transaction between the parties in the past, cannot ipso facto be construed as an admission of debt merely because the respondent may have so claimed in the suit. (Para 3)
Withdrawal of the criminal prosecution is no bar to the maintainability of the summary suit. (Para 4)
In a summary suit, if the defendant discloses such facts of a prima facie fair and reasonable defence, the court may grant unconditional leave to defend. This naturally concerns the subjective satisfaction of the court on basis of the materials that may be placed before it. (Para 11)
In an appropriate case, if the court is satisfied of a plausible or probable defence and which defence is not considered a sham or moonshine, but yet leaving certain doubts in the mind of the court, it may grant conditional leave to defend. In contradistinction to the earlier subjective satisfaction of the court, in the latter case there is an element of discretion vested in the court. Such discretion is not absolute but has to be judiciously exercised tempered with what is just and proper in the facts of a particular case. (Para 11)
The ultimate object of a summary suit is expeditious disposal of a commercial dispute. The discretion vested in the court therefore requires it to maintain the delicate balance between the respective rights and contentions by not passing an order which may ultimately end up impeding the speedy resolution of the dispute. (Para 11)
Copy of judgement: Judgement_15-Jul-2019