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Issues: (i) Whether the plaintiffs were entitled to a summary decree under Rule 1 of Chapter XIIIA of the Original Side Rules on the basis of the materials relied upon, and whether the defendants had raised a bona fide defence warranting leave to defend; (ii) Whether the defendants were entitled to defend the suits where the claim was disputed, reciprocal obligations were asserted, and security had already been furnished.
Issue (i): Whether the plaintiffs were entitled to a summary decree under Rule 1 of Chapter XIIIA of the Original Side Rules on the basis of the materials relied upon, and whether the defendants had raised a bona fide defence warranting leave to defend.
Analysis: Summary judgment is available only where the defence is illusory, sham, or practically moonshine. A defendant is entitled to defend where a triable issue or a fair and bona fide defence is disclosed, and if the defence is substantial the plaintiff cannot be permitted to sign judgment summarily. The claim in these suits arose out of a rehabilitation scheme and subsequent proceedings before BIFR and AAIFR, but the defendants disputed both liability and the quantum payable, including the alleged reciprocal obligations and the basis of the claim. The dispute could not be treated as non-existent merely because the plaintiffs relied on the rehabilitation proceedings and related materials.
Conclusion: The defendants had disclosed a defence fit for trial, and the plaintiffs were not entitled to a decree in summary proceedings.
Issue (ii): Whether the defendants were entitled to defend the suits where the claim was disputed, reciprocal obligations were asserted, and security had already been furnished.
Analysis: Where a defence raises a real issue, leave to defend should ordinarily follow. The existence of a dispute over the principal claim, together with the assertion that the plaintiffs had not performed reciprocal obligations, showed that the controversy required adjudication on evidence. The defendants had also furnished bank guarantees to secure the claim, which materially protected the plaintiffs' interest. In these circumstances, the discretion under the summary procedure ought to have been exercised in favour of granting leave to defend rather than foreclosing the defence.
Conclusion: The defendants were entitled to leave to defend, and the suits had to proceed in the ordinary manner.
Final Conclusion: The summary decree was set aside, leave to defend was granted, and the parties were left to have the disputed claims tried on merits, with the security to remain in force during the suit.
Ratio Decidendi: A defendant is entitled to leave to defend in summary proceedings where the defence raises a bona fide triable issue, especially when the claim is disputed and secured, and a summary decree cannot be sustained on a defence that requires adjudication on evidence.
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