2007 PLP 187 (YLR)

JAWWAD S. KHAWAJA, J.--This is a regular first appeal filed by the appellant/defendants to impugn the decree of the learned trial Court, dated 25-10-2005 whereof a suit filed by the respondents/plaintiffs for recovery of Rs.1,95,000 under Order XXXVII, C.P.C. on the basis of two cheques, has been decreed. The appellants/ defendants had filed an application seeking leave to appear and defend but the same was dismissed by the learned Trial Court.

2. I have heard learned counsel for the parties at length and have also gone through the record of the learned Trial Court. It is common ground between the parties that they had business dealings with each other whereunder the respondents supplied wheat to the appellant No.3 from time to time. According to the respondents, the appellants issued two cheques, one dated 5-8-2002 for Rs.95,000 and the other, dated 12-8-2002 for Rs.1,00,000 in consideration of the wheat supplied by them. The defence set up by the appellants in their leave application was that cheques were issued to the respondents which were not for consideration and were not meant to be enchased. The purpose of the cheques was to enable to the respondents to procure wheat by showing the cheques to the growers and assuring them that payment will be made to them.

3. There is extensive litigation both civil and criminal between the parties. In this connection, the appellants filed a suit on 24-5-2004 against the respondents for rendition of accounts. The said suit is pending adjudication. According to learned counsel for the appellants, the respondents deliberately avoided appearance in the said case although they were fully aware of its pendency. The respondents have also filed a suit against the appellants for rendition of accounts which is pending adjudication. According to learned counsel for the appellants, the respondents also filed criminal cases against the appellants and approached the senior police officer to exert unlawful pressure on the appellants to force them to make payment against the disputed cheques. One criminal case was lodged against the appellants in Jhang although the matter has no nexus with Jhang. The appellants have their business and residence in Faisalabad and even the banks on which the cheques are drawn, are located in Faisalabad. The appellants have filed Writ Petition. No. 18373 of 2004 seeking quashment of the said criminal case. The writ petition has been admitted to regular hearing and is pending adjudication before a Bench of this Court.

4. The respondents filed another criminal case being F.I.R. No. 163 of 2005 against the appellants on 30-4-2005 with Police Station, Jhang Bazar, Faisalabad. The appellants have filed Writ Petition No. 7339 of 2005 against the registration of the aforesaid case. This writ petition has also been admitted to regular hearing and is pending adjudication.

5. The learned Trial Court has proceeded to dismiss the appellants application for leave to defend on the ground, firstly, that the execution of the cheques has not been denied by the appellants and secondly, on the basis of paragraph 1 of a suit filed by the appellants for cancellation of the disputed cheques which is pending adjudication. Learned counsel for the appellants has, however, argued that the background of business dealings and litigation between the parties, referred to above, was sufficient for the purpose of granting leave to defend to the appellants. In addition, he pointed out that in the grounds in Writ Petition No.18373 of 2004, the nature of dealings between the parties and the purpose for issuance of the disputed, cheques was fully, set out.

6. On the aforesaid basis, learned counsel for the appellants argued that the appellants were entitled to prove their defence by leading evidence to show that no amount was due and payable to the respondents. Leave to defend is ordinarily to be granted unless the defence set-up is a sham. In the present case, keeping in view the circumstances narrated above, it is not possible to hold that the defence set up by the appellants is frivolous and incapable of proof. Leave to defend, therefore, should have been allowed to the appellants. However, considering that business dealings with the respondents were admitted by the appellants and they also did not deny execution of the cheques in question, the grant of leave should be subject to conditions which ensure that the respondents are properly secured and they get adequate value for money if at the end of the day they succeed in their suit.

7. In the above circumstances, this appeal is allowed and the impugned decree, dated 25-10-2005 is set aside subject to the terms that follow. The appellants are allowed leave to defend the suit subject to deposit of the suit amount in cash with the learned trial Court within 15 days from today. If this is done, the learned trial Court shall invest the said amount in Government securities or a profit bearing account with a scheduled bank. The party succeeding in the suit shall be entitled to the afore-said amount together with profit thereon. If the suit amount is not deposited within the stipulated period, this appeal shall, without further order, stand dismissed with costs. H.B.T./A-222/L?????????????????????????????????????????????????????????????????????????????????? Appeal allowed.