- (1.) The above Suit was originally filed by one Mr. J.P. Karwa against the Defendant -- Basant Bhoruka for the following reliefs: " (a) That the Defendant be ordered and decreed to pay a sum of Rs. 1,41,55,000/- (Rupees One Crore Fortyone Lacs Fifty five Thousand only) as per particulars of claim at Exhibit Y along with further interest at the rate of 24 per cent per annum on the principal amount of Rs. 96,00,000/- from the date of filing of the suit till realisation in full. (a1) that it be declared that, payment of the amounts mentioned in prayer (a) above duly secured by a valid and subsisting charge of the immovable property described in Exhibit W1 hereto and the Plaintiff is entitled to enforce the said security towards the realisation of the said dues."
(2.) The original Plaintiff -- J.P. Karwa (who later assigned his rights in favour of the present Plaintiff -- Ajay Kumar M. Singh) has in the Plaint stated/submitted as follows: 2.1 That the Plaintiff was a freelance liaison consultant with various Government authorities and body corporates for arranging finance in the form of lease, hire purchases, bill discounting, bank limits, public issue, bridge loan, etc. for body corporates and individuals. The Defendant is the Promoter/Managing Director of M/s. Digital Leasing and Finance Limited ("Digital Leasing"). The residential address of the Defendant is Flat No. 11A & B, Sudhakar Building, 11th Floor, 16 Narayan Dabholkar Road, Malabar Hill, Mumbai-400 006 ("suit property"). 2.2 In the year 1992, the Plaintiff came to know from the business circle that M/s. Digital World India Limited ( "Digital World"), a Company incorporated under the Companies Act, 1956, intended to go for public issue and was looking for a liaison person like him for getting approvals and sanctions from various Government authorities, banks and body corporates. The Plaintiff wrote a letter dated 8th May,1992 to Digital World , and offered his services which were accepted by Digital World (Exhibit "B" to the Plaint). The Plaintiff sent his quotation for various professional services vide letter dated 25th May, 1992. A Service Agreement dated 2nd June,1992 was entered into by the Plaintiff with Digital World (Exhibit "D" to the Plaint). 2.3 As per the said Agreement, the Plaintiff commenced rendering services to Digital World and accordingly submitted his debit notes dated (i) 26th February, 1993 for Rs. 9,32,000/- (Exhibit "E" to the Plaint), (ii) 12th February, 1994 for Rs. 6,00,000/- (Exhibit "F-1" to the Plaint). The Plaintiff continued to render his services as agreed from time to time to the said Digital World and also forwarded a statement of accounts as on 31st March, 1994 showing that an amount of Rs. 28,16,180/- was due and payable by the said Digital World to the Plaintiff (Exhibits "G" and "G-1" to the Plaint). Since the Plaintiff arranged further finance for Digital World, he also raised his debit note dated 28th May, 1994 for the sum of Rs. 4,40,000/- and by his covering letter forwarded the same to Digital World (Exhibits "H" and "H-1" to the Plaint). 2.4 The Plaintiff sent a letter dated 25th June, 1994 requesting Digital World to clear the debit notes raised till 31st March, 1994 aggregating to Rs. 28,16,180/- + Rs. 4,40,000/- being the amount of the last debit note dated 28th May,1994 (Exhibit "I" to the Plaint). M/s. Digital World sent its reply dated 29th June,1994 and requested further time for payment as the Company then was facing some liquidity crunch which was beyond their control (Exhibit "J" to the Plaint). Since Digital World did not make the payment, the Plaintiff sent a reminder letter dated 18th November, 1994, reminding the Digital World for the over due payment along with interest at the rate of 24 per cent as agreed in the Service Agreement (Exhibit "K" to the Plaint). M/s. Digital World by its letter dated 24th November, 1994 , inter alia, apologized for not making the payment in time and requested for further time (Exhibit "L" to the Plaint). 2.5 Thereafter in the last week of December, 1994, Digital World requested the Plaintiff to arrange for further funds which were arranged for by the Plaintiff, and the Plaintiff under cover of his letter forwarded a debit note dated 28th March,1995 for Rs. 11,20,000/- to Digital World (Exhibits "M" and "M-1" to the Plaint). The Plaintiff under cover of his letter forwarded a statement of account as on 31st March, 1995 to Digital World requesting Digital World to confirm the balance shown in the statement, being total outstanding of Rs. 51,35,663/- and further requested to make the payment due in the statement at the earliest (Exhibits "N" and "N-1" to the Plaint). A reminder letter dated 5th May, 1995 was also sent to Digital World. Digital World by its letter dated 10th May, 1995 again apologized for its inability to make the payment to the Plaintiff and stated that Digital World was in the process of availing further loan facilities from other body corporate which could be utilised to pay off the debts against the Plaintiff (Exhibit "O" to the Plaint). 2.6 According to the Plaintiff, the Defendant personally contacted the Plaintiff several times and assured the Plaintiff that all the dues would be cleared by the Defendant. The Plaintiff also sent his statement of account dated 5th April, 1996 to Digital World along with a covering letter requesting Digital World to make the payments which were long overdue (Exhibits "P" and "P-1" to the Plaint). 2.7 Thereafter the Defendant approached the Plaintiff for availing his services for one of the Group Companies, M/s. Digital Leasing, and entered into another Agreement dated 4th March,1994 for availing the services similar to that of Digital World (Exhibit "Q" to the Plaint). The Plaintiff rendered his services from time to time and by a letter dated 5th October,1996 forwarded a statement of account as on 30th September,1996 to Digital Leasing and requested for payment aggregating to Rs. 28,12,927/- (Exhibits "R" and "R-1" to the plaint). The Plaintiff sent a reminder letter dated 12th October, 1996 inviting attention of the Defendant and demanded a sum of Rs. 1,00,64,399/- due and payable by Digital World and Digital Leasing cumulatively to the Plaintiff. On 16th October,1996 the Plaintiff again demanded the said amounts and along with the said letter also enclosed the statement of complete accounts of Digital World and Digital Leasing as on 30th September, 1996 (Exhibits "S" and "S-1" to the Plaint), for transactions undertaken on behalf of both Companies. The Defendant on receipt of the letter called upon the Plaintiff and requested for reduction of the total outstanding. The Plaintiff considered the same and agreed for a full and final settlement at Rs. 95,00,000/-. The Defendant agreed to the said settlement and by a letter dated 22nd October, 1996 signed by him as Managing Director of Digital World, and promised to make the payment as agreed upon by the parties and requested for further time of couple of months (Exhibit "T" to the Plaint). Thereafter the Defendant by a letter dated 24th October, 1996 signed by him as Director of Digital World after referring to his earlier letter dated 22nd October, 1996 and subsequent personal discussions forwarded 10 post dated cheques aggregating to Rs. 95,00,000/- , particulars of which are set out in paragraph 14 (a) of the Plaint (Exhibit "T-1 to the Plaint). However, on or about 28th October,1996, the Defendant telephonically instructed the Plaintiff not to present the said cheques till he gave further instructions to do the same. The letter dated 24th October, 1996 and the fact that the cheques were issued to the Plaintiff, and thereafter the Plaintiff was instructed not to present the same, were introduced in the Plaint by an amendment dated 25th April, 2005. 2.8 On 29th October, 1996, the Plaintiff expressed his displeasure to the Defendant with regard to the delay in clearing his dues (Exhibit "U" to the Plaint). Therefore, by a letter dated 5th November, 1996 the Defendant expressed his willingness to execute a personal guarantee and to create a charge over the immovable property, being the suit property, towards security for the payment of dues of Rs. 95,00,000/- including interest till 30th September, 1996, and further interest at the rate of 2 per cent per month on the principal amount of Rs. 95,00,000/- till the payment in full to the Plaintiff (Exhibit "V" to the Plaint). Accordingly, the Defendant executed an Agreement (Exhibit "W" to the Plaint) dated 26th November, 1996 (Exhibit "W-1" to the Plaint) and created a charge over the Flats i.e. A & B Sudhakar Co-operative Housing Society, Narayan Dabholkar Road, Malabar Hills, Mumbai-400 006 ('the suit flats') for which the Defendant is holding shares, towards security for the payment of the long over due service charges to the Plaintiff, with interest at the rate of 24 per cent per annum from 1st October, 1996 on Rs., 95,00,000/- till realisation in full. Vide the Agreement dated 26th November, 1996, the Plaintiff also had the option to stake a claim on the properties (suit flats) in the event the Defendant failed to make the payment within 31st March, 1998. The Defendant also executed a Personal Guarantee dated 26th November, 1996 ( Exhibit "X" to the Plaint), which according to the Plaintiff, is independent of the charge created earlier vide Agreement dated 26th November, 1996, and independent of any other right vested with the Plaintiff for claiming the due payment from the Defendant or from the respective Companies. 2.9 Both the Documents i.e. Exhibits "W" and "X" were forwarded by the Defendant to the Plaintiff under cover of his letter dated 4th December, 1996 (Exhibit "X-1" to the Plaint). 2.10 Thereafter the Plaintiff filed the above Suit on 30th October,1998, only for an order and decree against the Defendant to pay a sum of Rs. 1,41,55,000/- as per the particulars of claim Exhibit-Y, along with further interest at the rate of 24 per cent per annum on the principal amount of Rs. 95,00,000/- from the date of filing of the Suit till realisation in full. 2.11 On 27th July, 1999, the Plaint was amended and prayer (a1) was introduced seeking a declaration that the payment of the amounts mentioned in prayer clause (a) were duly secured by a valid and subsisting charge qua the suit flats and the Plaintiff was entitled to enforce the said security towards the realisation of the said dues. 2.12 That vide Deed of Assignment dated 15th September, 2012 executed between the original Plaintiff J.P. Karwa and Assignee Ajay Kumar M. Singh and Supplementary Deed of Assignment dated 15th March, 2014, the original Plaintiff transferred and assigned his entire claim and receivables in Suit No. 5086 of 1998 to the Assignee (present Plaintiff -- Ajay Kumar M. Singh). The Plaint was therefore amended on 25th February, 2015, and the name of the original Plaintiff -- J.P. Karwa was deleted and substituted by Shri Ajay Kumar M. Singh.
(3.) On 16th March, 2006, the Defendant filed his Written Statement and, inter alia, submitted as under: 3.1 That the entire plaint is patently false, bogus and fabricated, that the events and transactions alleged in the plaint never took place and that the entire plaint is a result of the Plaintiff's forgery, fabrication, manipulation, mala fide intentions and illegality. Never were the alleged services, as stated on record of the case, provided to the two Public Limited Companies, nor were the alleged debit notes raised or sent, nor did any of the alleged correspondence ever take place, nor did the Defendant ever give any alleged personal guarantee for such non-existent services and nor did Defendant create a charge on the said flats. 3.2 That it is well within the Plaintiff's knowledge that in the records of Sudhakar Co-operative Housing Society Ltd., the said flats belonged to M/s. Transport Corporation of India Ltd., as is stated in the said Society's letter to the Plaintiff's Advocates dated 28th April, 1999, and exhibited by the Plaintiff himself as Exhibit-C to his Affidavit in Support of the Notice of Motion No. 180 of 1999. Again, it is apparent that the Plaintiff was fully aware of the transfer of the said flats by registered conveyance by M/s. TCI to Badriprasad Bhoruka Family Trust in December, 1999, since the Plaintiff's prayer to appoint Receiver was made on that very foundation. However, the Plaintiff never thought it necessary to join either the past owner or the present owner of the said flats as necessary parties to the Suit even though the Plaintiff's Suit is based upon an alleged charge over the said flats in favour of the Plaintiff. 3.3 That the alleged charge is an unregistered charge and cannot be looked into by this Court, even if it is presumed, though not admitted, and in fact vehemently denied that such a document was created; 3.4 That the Document dated 29th May, 1992 being the alleged Service Contract between the Plaintiff and the Defendant is a false and fabricated document. In fact, on the date of the alleged personal meeting and execution of the alleged Document, the Defendant was not even in India but was in Singapore from 21st May, 1992 upto 10th June, 1992. 3.5 That the execution of the Deed of Guarantee is denied, and in any event the alleged Personal Guarantee dated 26th November, 1996 is void as the same is without any consideration. 3.6 That even if the case of the Plaintiff is taken at face value, and for the sake of argument it is considered that what the Plaintiff has stated is proved, even then no decree can be passed against the Defendant as prayed for by the Plaintiff since the Plaintiff has lost securities in the form of Negotiable Instruments and the right to recover the monies from the two principal borrower Companies, to which the Defendant certainly would have been entitled. 3.7 It is now apparent that the Defendant will not be in a position to recover monies from the securities of the principal borrower companies, and as such the Plaintiff has no right to recover money from the Defendant because Plaintiff is bound to suffer for its own lapses. 3.8 That the Plaintiff has neither sued those companies nor joined them as necessary parties in the present Suit, and as such has deliberately not availed of any opportunity to establish liability against those two Companies which are in fact principally liable. It is only after the liability of the two companies is established that it can be ascertained as to whether any sum is due to the Plaintiff from those two Companies, for which the Defendant is liable. 3.9 That even otherwise the Deed of Guarantee is inadmissible in evidence as signatures/initials of either party are not affixed on all the pages of the documents, including on the sheets of stamp paper, and as such the entire document is inadmissible in evidence. 3.10 That the present proceeding is liable to be dismissed as the same is barred by limitation. 3.11 That the Plaintiff has not provided any proof of service as alleged to Digital World, and the Defendant has not received any statement of account or debit notes issued by the Plaintiff. 3.12 The Defendant has not received the letter dated 25th June,1994 and has not sent any response dated 29th June, 1994. The Company has also not received any letter dated 18th November, 1994 nor sent its response dated 24th November, 1994 to the Plaintiff. 3.13 That the Defendant was not in India from 20th June,1994 to 13th July, 1994, as is borne out from the Defendant's Passport. The question therefore of him receiving the Plaintiff's alleged letter dated 25th June, 1994 never arose. 3.14 That since the Defendant was often required to visit foreign countries for its business of import, the Defendant used to keep certain signed blank sheets and cheques to enable his senior executives, management and staff to complete documentation and transactions etc. which should not be hampered in his absence. It is apparent that the Plaintiff made friends in the Office of the Defendant and got access to such blank signed papers and cheques and misutilised the information and the documents, to fabricate this false Suit. 3.15 That the Defendant never availed of the Plaintiff's services for Digital Leasing nor Digital World and never entered into any alleged Agreement dated 4th March, 1994, the signature on the said document is forged and/or lifted by the Plaintiff. 3.16 That the debit notes and statements referred to by the Plaintiff in respect of both the Companies, Digital World and Digital Leasing are denied. Not a single debit note in respect of Digital Leasing has been exhibited in the plaint. 3.17 That the alleged reminder letter dated 12th October, 1996 and alleged letter dated 16th October,1996 are denied vehemently and the Plaintiff is put to strict proof thereof. The Defendant had never requested the Plaintiff to reduce the total outstanding which is in itself non-existent. The Defendant never sent any letter dated 22nd October, 1996. 3.18 That the Defendant had not sent the letter dated 24th October,1996 and had also not forwarded any post-dated cheques in favour of the Plaintiff amounting to Rs. 95 lakhs. 3.19 That inspection of the said cheques in their covering letter was never provided to the Defendant. 3.20 That the Defendant has not offered to personally guarantee the alleged payment nor to create charge of personal property as alleged. 3.21 That the alleged letter dated 5th November, 1996 is fabricated and the signature is lifted or forged. The letter is one more example of misuse by the Plaintiff of stolen stationery. 3.22 That the alleged Agreement of Guarantee and the Agreement for Creation of Charge were got up and fabricated documents. Stolen sheets with the signatures of the Defendant have been manipulated and used as page 2 of both the Documents, which are not genuine and which were created by the Plaintiff to support his illegal claim. 3.23 That inspection of the original Documents was given to the Defendant and his Advocate on 25th November, 1998, and during the inspection, certain detailed handwritten notes were prepared by the Advocate while comparing the originals given during inspection with the true copies typed and exhibited in the plaint. The said hand written notes were in the nature of description of specific physical characteristics of the original documents given for inspection such as colour of ink used, number of pages, etc. and other such characteristics which could be referred to in future for identification of the said documents. The Advocate for the Plaintiff initialled each page of the said notes and signed upon the last page of the notes thereby verifying the description of the physical documents as noted by the Advocate for the Defendant. Despite specific request made by the Defendant's Advocate on 25th November, 1998 that the Plaintiff should make available photo copies of the original documents, the same were not given to the Defendant or his Advocate on 25th November,1998, but was given 19 days later i.e. on 15th December,1998 at about 4.20 p.m. with no explanation for the delay. There were material variances between the photo copies as furnished by the Plaintiff's Advocate and the original documents produced during the inspection, as set out in clauses (a)to (d) of paragraph 14 of the Written Statement. 3.24 That the Defendant was never at any point of time the owner of the said flats and never created any mortgage, charge or third party interest in the suit flats. 3.25 That the Defendant has placed all the relevant facts of the ownership of the said flats before the Court in the Review Petition filed against the ex-parte order of the Receiver passed by the Learned Single Judge and also in the Appeal against the order appointing Receiver filed before the Hon'ble Division Bench, which are both on the record of the case. 3.26 That in the above circumstances no amount is due and payable by the Defendant to the Plaintiff.;