Defendants granted leave to defend suit on deposit condition due to triable issues; summary judgment application disposed.

The court granted leave to the defendants to defend the suit on the condition that they deposit a specified amount with the Registrar to secure the plaintiff's claim, as the defendants' defense raised triable issues and was not deemed frivolous. The application for summary judgment was disposed of accordingly.

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Issues Involved:
1. Whether the defendants have a genuine defense against the plaintiff's claim for summary judgment.
2. Whether the defense set up by the defendants is illusory, sham, or practically moonshine.
3. Whether the plaintiff is entitled to a summary judgment based on the evidence presented.

Summary:

Issue 1: Genuine Defense Against Plaintiff's Claim
The plaintiff filed an application for summary judgment for a sum of Rs. 1,05,81,972/- against the defendants, who had obtained a loan of Rs. 50,00,000/- with an interest rate initially set at 17% per annum, later increased to 18% per annum. The loan was renewed periodically, but the defendants failed to make interest payments from October 1, 2013, onwards. They issued a cheque for Rs. 50 lakhs on January 16, 2017, which was dishonored due to insufficient funds. The plaintiff initiated proceedings under Section 138 of the Negotiable Instruments Act, 1881. The plaintiff's counsel argued that the defendants admitted to receiving the loan and paying interest until September 30, 2013, and that the dishonored cheque further supported the plaintiff's claim.

Issue 2: Illusory, Sham, or Practically Moonshine Defense
The defendants admitted to availing the loan but claimed financial difficulties prevented them from repaying. They contended that an agreement was made to sell certain properties to the plaintiff for Rs. 1,25,00,000/-, with Rs. 50 lakhs as earnest money, and the balance to be paid upon registration of the conveyance deed. The defendants argued that the plaintiff failed to pay the balance, leading to the forfeiture of the earnest money. They also claimed the cheque was issued as security in 2013 and dated January 16, 2017, without their consent. The defendants' counsel cited precedents emphasizing that a defense need not be positively good but must be fair, bona fide, or reasonable to warrant leave to defend.

Issue 3: Entitlement to Summary Judgment
The court reviewed the plaint, written statement, application, and affidavit. It noted that the defendants admitted the loan and interest but claimed a financial crisis led to an agreement to sell property, which the plaintiff allegedly breached. The court referred to established principles for granting summary judgment, including whether the defense is substantial, raises triable issues, or is frivolous. It concluded that the defendants should be allowed to prove their defense if they secure the plaintiff's claim by depositing Rs. 1,22,34,027/- with the Registrar of the court within two weeks.

Conclusion:
The court granted leave to the defendants to defend the suit on the condition that they deposit the specified amount with the Registrar, ensuring the plaintiff's claim is secured. The application for summary judgment was disposed of accordingly.

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