1. The short question that arises for consideration in the suit is whether the suit is maintainable as a summary suit?
2. The facts as pleaded in the plaint may be briefly stated thus:
The plaintiff knew the defendant for 10 years. At the request of the defendant, the plaintiff advanced to the defendant a friendly loan of, Rs. 1,00,0,00/- on 7th, December, 1995 for which the defendant agreed to pay interest at the rate of 21% p.a The loan was repayable by 31st December, 2000. The defendant paid interest to the plaintiff at the agreed rate up to 30th September, 1997 but thereafter failed to pay further interest and also failed to repay the principal sum of Rs. 1,00,000/-. Plaintiff therefore filed the suit for recovery of the sum of Rs. 1,00,000/- with interest under the provisions of Order XXXVII of the Code of Civil Procedure.
3. Admittedly, there is no written agreement between the parties regarding the loan nor has the defendant executed a bill of exchange, a hundi or a promissory note. Learned counsel for the plaintiff however, submits that the loan was advanced to the defendant by the plaintiff by a cheque (which is a bill of exchange) drawn on Hongkong and Shanghai Banking Corporation and hence the suit is based on a bill of exchange and is maintainable as a summary suit. The learned counsel relies upon a certificate issued by Hongkong and Shanghai Banking Corporation on 16th July, 2003 certifying that cheque No. 649794 dated 7th February, 1995 for Rs. 1,00,000/- favouring ‘Coastal Energy’ (concern of which the defendant is a proprietor) was encashed and debited to the plaintiffs account on 8th February, 1995.
4. Sub-Rule 2 of Rule 1 of Order XXXVII of the Code of Civil Procedure Code prescribes suits which can be filed as a summary suit and reads as under:
(2) Subject to the provisions of sub-rule (1), the Order applies to the following classes of suits, namely:
(a) suits upon bills of exchange, hundies and promissory notes;
(b) suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest arising,
(i) on a written contract; or
(ii) on an enactment where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or
(iii) on a guarantee where the claim against the principal is in respect of a debt or liquidated demand only.
It is not disputed that the suit is not based on a written contract nor is based upon an enactment or on a guarantee and is therefore not covered by clause (b) of sub-rule 2 of order XXXVII of the Code of Civil Procedure. Learned counsel however, submits that the suit is covered under clause (a) of sub-rule 2 of Rule 1 of Order XXXVII of the Code of Civil Procedure. He submits that the cheque is a bill of exchange drawn on a bank and as money was advanced to the defendant by a cheque i.e bill of exchange, the suit is based upon a bill of exchange and is maintainable as a summary suit. I am unable to agree. It is true that a cheque is a bill of exchange, a special type of bill of exchange which is drawn on a bank. However, a suit upon a cheque (bill of exchange) means a suit to recover money due on a cheque (bill of exchange) drawn by the defendant, which is dishonoured. The suit must be for recovery of money of a cheque drawn in favour of or endorsed to the plaintiff. A suit for recovery of a loan which was advanced by the plaintiff by a cheque is not a suit upon a cheque or a bill of exchange and as such is not maintainable as a summary suit. Therefore, contention of the plaintiff that present suit is upon a bill of exchange is rejected.
5. Suit is not triable as a summary suit and is not covered by the provisions of Order XXXVII of the Code of Civil Procedure. The suit should therefore be treated as a regular suit and be transferred in the list of commercial causes.
Order accordingly.