N. Arjuna Chetty vs S. Mallappan and Another

V. Ratnam, J.—The plaintiff, in O.S. No. 4499 of 1976, on the file of the learned VII Assistant Judge City Civil Court, Madras, is the

petitioner in this civil revision petition. He instituted a suit for the recovery of Rs. 5,142 together with further interest on Rs. 3,000 at 24 per cent

per annum from 23rd August, 1976, to the date of decree and thereafter at 6 per cent per annum and for costs. The suit was laid on the basis of a

promissory note dated 2nd July, 1973 executed by the respondents in favour of the petitioner herein under Order 37, Rule 1 of the Code of Civil

Procedure. The respondents herein filed l.A. No. 21760 of 1976 for grant of unconditional leave to defend the suit and the application was

dismissed, as having been filed beyond the stipulated time It must also be mentioned that the dismissal of IA. No. 21760 of 1976 has become final

However, the respondents filed IA. No. 21761 of 1976 praying for the dismissal of the suit on the ground that the suit had been instituted by the

petitioner herein in contravention of Section 4 of the Tamil Nadu Act XVI of 1976. The learned VII Assistant Judge, City Civil Court, Madras,

applied the principles laid down in RM. M. Ramanathan Chettiar Vs. Ramaswami Pillai and Another, and allowed I.A. No. 21761 of 1976

thereby dismissing the suit as not maintainable.

In this civil revision petition, the learned Counsel for the petitioner raised two contentions. The first is that having regard to the dismissal of I.A

No. 21760 of 1976, the respondents are precluded from appearing in the cause and contest the same as per the provisions of Order 37, Rule 2,

Civil Procedure Code, and the second is that the dismissal of the suit as having been institued in contravention of Section 4 of the Tamil Nadu Act

XVI of 1976 is unsustainable.

It is not in dispute that the summary procedure will apply to the present suit which is based on a promissory note. It is also (sic) in dispute that

the respondents attempt to obtain leave to defend, but that It proved tile. Under the summary procedure, the defendant shall not appear or defend

the suit, unless he obtains leave to defend and in default of his obtaining such leave, the allegation in the plaint should be deemed to have been

admitted by the defendant and the plaintiff will be entitled to a decree. In this state of affairs, therefore, on the failure of the respondents to obtain

leave to defend, the plaint claim is deemed to have been admitted and it is not open to the respondents to plead that they are persons entitled to the

benefits of the Tamil Nadu Act XVI of 1976. The plaint is silent with reference to the entitlement of the respondents to the benefits under the Tamil

Nadu Act XVI of 1976 and by reason of the failure of the respondents to obtain leave as stated earlier, the respondents are precluded from setting

up any defence including the non-maintainability of the suit in view of Section 4 of the Tamil Nadu Act XVI of 1976. Since it is not open to the

respondents to raise such a plea, the Court below is in error when it permitted the respondents-defendants to put forth such a plea and also in

having entertained the same. For the reasons stated above, the respondents should not have been permitted at all to raise the plea that the suit is

barred u/s 4 of the Tamil Nadu Act XVI of 1976. If this be so, then the dismissal of the suit is incorrect.

In this view, it is unnecessary to consider the other question whether Section 4 of the Tamil Nadu Act XVI of 1976 would bar the maintainability

of the suit.

The result is that the order of the Court below is set aside and the Civil Revision Petition is allowed and there will be a decree in favour of the

petitioner in the suit as prayed for. No costs in the Civil Revision Petition.