JAYASHREE SANJAY JUVEversusJaywant Ganpatrao Laykar

                                                  39-WP-4046-2026 (C).doc




              IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                      CIRCUIT BENCH AT KOLHAPUR

                      CIVIL APPELLATE JURISDICTION

                     WRIT PETITION NO. 4046 OF 2026

Jayashree Sanjay Juve                        ]
Age: 46 years, Occ.: Household,              ]
R/at 16/631, Mhetar Galli,                   ]
Near Shivaji Nagar Police Station,           ]
Ichalkaranji, Tal. Hatkanangale,             ]
Dist. Kolhapur – 416115.                     ]    ...Petitioner
                                             ]
           Versus                            ]
                                             ]
Jaywant Ganpatrao Laykar                     ]
Age: 65 years, Occ.: Business,               ]
R/at 10/156, Laykar Galli,                   ]
Narayan Peth, Ichalkaranji,                  ]
Dist. Kolhapur – 416115.                     ]    ...Respondent

                                 …..
Adv. Ryan D’souza a/w Adv. Shivam Laturiya and Adv. Prerna Somani
i/b Adv. Shivam Laturiya, Advocate for Petitioner.
Adv. Rajvardhan S. Chougule, Advocate for Respondent.
                                 …..


                                     CORAM : SHAILESH P. BRAHME, J.

                                     DATE   : 28th AUGUST, 2026.

FINAL ORDER :

           Heard.

2.         The Petitioner takes exception to the order dated 23.07.2026

passed below Exhibit - 12 in Summary Suit No. 2 of 2025 refusing to

grant leave to defend the suit.



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3.         The Respondent has instituted Summary Suit No. 2 of 2025 for

recovery of Rs.6,00,000/- along with interest against the Petitioner. It is

specifically averred that the Respondent lent Rs.3,00,000/- twice in

cash to the Petitioner and in lieu of that, a non-CTS cheque dated

07.12.2024 was secured from him. The cheque was dishonoured with a

remark 'non-CTS cheque' by Memo dated 09.12.2024 by Bank of India.

The amount was demanded which was refused, hence the suit was filed.

4.         In pursuance of the summons for judgment, Petitioner appeared

in the suit and filed Application Exhibit - 12 seeking leave to defend,

raising various pleas to indicate that there existed no such transaction

of money lending. A cheque which was issued in the year 2009 is stated

to have been misused by the Respondent, who happened to be

Chairman of Shahu Corner Co-operative Credit Society. It is contended

that the transaction is sham and bogus and application for leave is

supported by the communication/correspondence of the bank dated

13.08.2025, Memo dated 09.12.2024 and the cheque itself.

5.         The Respondent contested the application. By impugned order,

application was rejected.

6.         Learned Counsel for the Petitioner, Mr. D’souza, would advert my

attention to the averments of the plaint, indicating that cash of

Rs.3,00,000/- is stated to have been paid to the Petitioner on two

occasions, i.e. 16.11.2024 and 22.11.2024. The transaction itself is




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barred and no claim can be set on the basis of such averment. It is

further pointed out that the cheque in question is non-CTS and the

correspondence with the bank would support that it was issued before

2010. Reliance is placed on the judgments of the Delhi High Court to

buttress that Trial Court committed error of jurisdiction. Lastly, it is

pointed out that the Trial Court exceeded its jurisdiction in expecting

the Petitioner to produce the evidence at this stage of the proceedings.

7.         Per contra, learned counsel for the Respondent would vehemently

submit that the plea raised by the Petitioner has not been supported by

material on record. The transaction with the co-operative bank has not

been established at all. It is submitted that it was open for the Petitioner

to file complaint for return of the cheque but no steps were taken. It is

further submitted that the presumption under Section 139 of the

Negotiable Instruments Act would support the Respondent. It is

submitted that Trial Court is justified in rejecting the Application Exhibit

- 12 and the Petitioner is dodging the claim. He has placed reliance on

the judgment rendered by the Division Bench of this Court.

8.         I have perused the plaint, which unequivocally states that on

16.11.2024 cash of Rs.3,00,000/- and on 22.11.2024 cash of

Rs.3,00,000/- was paid by the Respondent to the Petitioner as a hand

loan. In lieu of the hand loan, a non-CTS cheque dated 07.12.2024 is

stated to have been secured from the Petitioner. The correspondence




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dated 13.08.2025 addressed by Bank of India to the Petitioner would

indicate that in pursuance of her request, cheque books were issued in

the year 2009.

9.          I find that probable and triable defense has been raised by the

Petitioner that the cheque which was issued way back in the year 2009

has been used by the Respondent. It is the case of the Petitioner that

Respondent was Chairman of the Shahu Corner Co-operative Credit

Society from which the Petitioner had obtained loan and the cheque

was issued towards security. The documents produced by the Petitioner

would constitute prima facie plea of defense.

10.         In view of the material on record, I am of the considered view

that the defense raised is available and needs to be tested during the

course of trial. The finding recorded by the Trial Court that no evidence

was produced is ex-facie illegal and perverse.

11.         It is overlooked by the learned Judge that matter is at the stage of

the pleadings and the party is not expected to lead evidence to disclose

the defense. There is sufficient material to indicate that triable and

plausible defense is available for the Petitioner. The Trial Court

exceeded in its jurisdiction in expecting the Petitioner to furnish the

material particulars of her earlier transaction with the Cooperative

Society. It would be a matter of objective scrutiny during trial.

12.         The submissions of the Respondent as to whether any complaint




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could have been made by the Petitioner for return of the cheque or the

presumption available under Section 139 of Negotiable Instruments Act,

1881, can be tested during the course of trial.

13.         Learned Counsel for the Petitioner has relied upon the judgment

of the Learned Single Judge of Delhi High Court in the case of Mahesh

Kumar Wadhwa Versus Bimal Luthra1 to buttress that if the summary

suit is filed on the basis of cash transaction, then that would be the

ground to grant            leave to defend. In that matter also, cash of

Rs.14,55,000/- and further Rs.4,75,000/- was advanced and the

defendant had sought leave to defend the summary suit. The leave was

granted by making following observations which are also relevant to

decide controversy involved in the present case:


               “7. *******
                  A. *******
                  B. *******
                  C. *******
                  D. There is also no explanation as to why such large sums of
               monies were transacted in cash.
                  E. The plaintiff has not filed a single document to show the
               availability of cash in such large volume with him on the dates
               alleged.
                  F. A party who transacts in such casual manner, does so at his
               own peril. The purport of Order 37 is to provide benefit of
               summary procedure to plaintiffs who take care to have their
               transactions properly documented in accordance with law. The
               summary procedure is intended to encourage due recording
               /documentation in the course of trade/commerce. A person
               who while lending / advancing money makes a proper valid bill
               of exchange hundi, promissory note or a contract was intended
               to be bestowed advantage of quicker recovery of money
               without protracted trial. A party to avail of such significant
               benefit ought to take care in the making and execution of the
               document and lend money by cheque only, so as to eliminate
               defences of denial. The abridgement of procedure of trial for

1   2009 (107) DRJ 271.



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               adjudication of factual disputes in Order 37 is an exception and
               cannot be extended to cases where the document itself is
               suspect or leaves scope for denial of receipt of money. The
               banking sector has developed immensely in the country over
               the years, with all having access to the banks. In these modern
               times transactions in large sums of monies, in cash and through
               non banking channels will always remain open to challenge and
               cannot claim preference in procedure for adjudication. To hold
               otherwise would be to give encouragement to such
               transactions, which otherwise need to be curbed. With the
               introduction of Section 138 in the Negotiable Instruments Act,
               judicial notice can be taken of the fact that normally post dated
               cheques in refund of monies lent/advanced are taken. Even if
               the plaintiff was lending money in cash, the plaintiff in the
               normal course would have been expected to take cheques for
               refund. All these circumstances in the present case lead me to
               the conclusion aforesaid. Nothing said here should however be
               understood as laying down that Order 37 CPC would not be
               applicable wherever transaction is in cash. If the cash is
               explained and supported by other documents, action would lie.
               However, in this case notwithstanding specific plea in leave to
               defend application that the plaintiff had no means and had not
               disclosed the said monies in his income tax returns, the plaintiff
               has in his reply evaded answering the said pleas and also not
               filed any document to controvert the same. There cannot be
               two stands permitted to any party, one for purposes of taxation
               and other for litigation.
                  G. *******
                  H. *******
                  I. *******”


14.         The learned Judge had granted unconditional leave. I propose to

adopt the same course in the present case. Further reliance is placed on

the judgment of Hon’ble Supreme Court in the matter of B. L. Kashyap

& Sons Limited Versus JMS Steels & Power Corporation & Anr. 2. I have

gone through the various principles deducted from the judgments of the

Supreme Court quoted in Para No. 32. It is relevant to reiterate Para 33

which is as follows:



2   (2022) 3 Supreme Court Cases 294.



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               “33. It is at once clear that even though in IDBI Trusteeship, this
               Court has observed that the principles stated in para 8 of
               Mechelec Engineers case shall stand superseded in the wake of
               amendment of Rule 3 of Order 37 but, on the core theme, the
               principles remain the same that grant of leave to defend (with
               or without conditions) is the ordinary rule; and denial of leave
               to defend is an exception. Putting it in other words, generally,
               the prayer for leave to defend is to be denied in such cases
               where the defendant has practically no defence and is unable to
               give out even a semblance of triable issues before the court.”



            The principles are squarely applicable to the present case.


15.         The Counsel for the Respondent has relied on the judgment of

the Division Bench of the Bombay High Court in the case of Rajesh

Laxmichand Udeshi@Bhatia Versus Pravin Hiralal Shah3 and specifically

on paragraph Nos.17 and 18 of the judgment. I have gone through

paragraph Nos.17 and 18 of the judgment. The facts of the case before

the Division Bench are distinguishable. In the case at hand, the cash

transaction has come to the fore and I have already observed that there

exists prima facie material to make out the probable defense.

16.         Its a fit case to grant unconditional leave to defend the suit. The

respondent is claiming recovery of sum advanced to the petitioner in

cash. My attention is adverted to the judgment of the Hon’ble Supreme

Court in the matter of Correspondence, RBANMS Educational

Institution Versus B. Gunashekar and Another 4. The Hon’ble Apex Court

has referred to the policy of the Central Government to cap cash

transactions and move forward towards a digital economy to curb the

3   2012 SCC OnLine Bom 2181.
4   2025 SCC OnLine SC 793.



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dark economy. In paragraph No.18.1, the amendment brought into

force from 01.04.2017 is referred to, indicating the restrictions for cash

transactions over the prescribed limit and the proposed action against

the same. The applicability of the amendment needs to be gone into

during the course of trial. Hence, I am of the considered view that if the

plea of the petitioner is accepted, the suit would be liable to be

dismissed.

17.         Considering overall conspectus of the matter, I am of the

considered view that Petitioner is not only entitled to leave but entitled

to unconditional leave to defend the summary suit. The Trial Court’s

order is unsustainable. I therefore pass following order:


                                     ::ORDER::

A.          The Writ Petition is partly allowed;

B.          The order dated 23.07.2026 passed below Exhibit - 12 in

Summary Suit No. 2 of 2025 is quashed and set aside and the

Application Exhibit - 12 stands allowed granting unconditional leave to

defend the suit.

                                                   [ SHAILESH P. BRAHME, J.]




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