Notice
[ To Recover Money(legal debts) ]
Date:
From,
The name & address of the person giving the Notice
(Notice must be given by a person who is authorized to give Notice)
To,
The name & address of the Recipient of the notice
(Notice must be given to a person who is authorized to receive Notice)
(Notice must be sent at address if prescribed under any law)
Subject of the Notice
Dear Sir / Madam,
1) By this Notice, I/we invite your attention that you owe to me/us Rs.AAAAAAAA towards ……… (state brief facts constituting the liability / debt)
2) Despite my/our repeated efforts, you have so far evaded to make payment for the above liability.
3) Legal Expectation: By way of this Notice you are hereby called upon to pay Rs.AAAAAAAA in the discharge of your liability.
4) The consequences that may follow: Take notice that your failure to comply to legal expectation as stated hereinbefore may compel me/us to institute Criminal & Civil Proceedings in the Court of Law as permissible under the law, and the cost of all these litigation will be recovered from you.
(A) Also, take notice that I/we may file Summary Suit to recover above amount.
Take notice that- Summary Suits are contemplated under Order XXXVII (Order 37) of Civil Procedure Code of 1908, and is a very powerful and expeditious remedy provided under the law for recovering money, which is routinely trapped in commercial transactions and in contracts.
The underlying public policy behind Order 37 is the expeditious disposal of suits of commercial nature. Bankyag B G Agarawal versus Bhagwanti Mehji 2001 (1) Bom LR 823 (DB)
The provisions of this Order 37 are enacted to ensure that the defendants doesn’t prolong the litigation by raising untenable and frivolous defences. K R Kesavan versus The South Indian Bank Ltd AIR (37) 1950 Madras 226 (228) DB
The provisions of Order 37 are enacted by Parliament to discourage litigants from coming forward with untenable pleas with the object of delaying admitted liabilities and prolonging the inevitable decree. Dena Bank versus M/s Gladstone Lyall & Co 87 Bombay Law Reporter 477 (480)
The procedure contemplated by Order 37 of CPC constitutes a clear departure from usual procedure. According to usual procedure, every defendant has a right to defend his case in the manner best suited to him. The Summary procedure is a powerful weapon in the hands of Court to shut out frivolous defences which are raised in commercial causes with a view to prolong the litigation. Kocharabhai ishwarbhai patel versus Gopal bhai C patel AIR 1973 Gujrat 29 (31)
Please take Notice of the procedure under Summary Suit--
- The Plaint is filed in the competent court of jurisdiction.
- The Plaint gets numbered.
- The Plaintiff takes out summons and arranged to get it serve upon the Defendant through Bailiff.
- Once the Summons is served upon the defendants, he has to file his appearance in the court within 10 days from the receipt of summons.
- If the defendant fails to file his appearance within 10 days, the Plaintiff may approach the Court to pass ex-parte decree and courts are empowered to pass ex-parte decree in such circumstances.
- If the defendant file his appearance, than the Plaintiff has to take out Summons for Judgment and arranged to get it serve upon the defendant through Bailiff.
- The defendant in receipt of Summons for Judgment has to move court within 10 days and file his Affidavit of Defence. In his Affidavit of Defence, he must satisfy the Court that he has substantial defence.
- After looking at the averments made in the Affidavit of Defence, the Court may allow the Defendant to defend the case or the Court may pass the decree if it finds that Defendant has no good defence.
Therefore, if a Summary Suit (case) is filed on 1st January 2011 and Summons were take out and say served on the defendant on 10th January 2011, the Defendant has to file his appearance by 20th January 2011. If he files, then, Summons for Judgment are taken and served. If this Summons for Judgment is served upon, say on 31st January, then, the Defendant has to file his Affidavit of Defence within 10th February. On the date of hearing on 10th February, if the Court finds that the Defendant has no substantial defence, then, the Court will pass the decree.
Thus, a Summary Suit filed on 1st January 2011 may be decreed within 45 days from the date of filing.
I/we also want to draw your attention to some of the Court rulings, which may be relied upon if this matter goes to the Court.
Money Claims based on Invoices
Invoices/Bills are written contract within the contemplation of Order 37 of CPC 1908. KIG Systel Ltd versus Fijitsu ICIM Ltd AIR 2001 Del 357.
Where the suit was filed for recovery of price of goods sold and delivered, it was observed that Plaintiffs has delivered the goods to the defendants not intending to do so gratuitously and the defendants had enjoyed the benefits of them and under the provisions of section 70 of Contract Act, the Defendants are liable to pay compensation in respect of such goods to the plaintiffs. Jaishree Chemicals versus M/s Esskay Dyeing & printing Works, BHC Summons for Judgment No.23 of 1976 in Suit no. 1405 of 1975 decided on 19th April 1976.
Where the price of the goods were payable on the basis of “Cash on Delivery” and where the defendant accepted the delivery of the goods without any reservation and the defendant has dealt with the goods after taking delivery, it was held that trial court was justified in refusing leave to defend. MMTC Ltd versus Dimple Overseas Ltd AIR 2001 Delhi 427
Money Claims when acknowledgement of debt in Balance Sheet / Khata or otherwise
Summary Suit can be filed on the basis of confirmed Balance / Khata and the reconciliation statement. Hindustan Wires Ltd versus Ralsons Tires Ltd 90 (2001) Delhi Law Times 777.
Where the liability was acknowledged in Balance sheet which was signed by partners of the firm, it was held that it amounted to a promise within the meaning of section 25(3) of the Contract Act 1872. Section 2593) validates a promise to pay a debt barred by limitation. M/s R Suresh Chandra & Co versus Vednere Chemicals Works & Ors AIR 1991 Bom 44 (47 Para 10)
The acknowledgment of debt in Balance Sheet amounts to acknowledgment in writing within the meaning of section 18 of the limitation Act. Rishi Pal Gupta versus S J knitting & Finishing Mills Pvt Ltd 73 (1998) Delhi Law Times 593 (598 para 14) A V Murti veresus B S Nagabasavanna 2002 (1) Supreme 517 (520 para 5)
Where a receipt indicates that money was borrowed, it becomes an acknowledgement. M/s Kalyani Hansraj & Ors versus Mrs Kamong A Agarwal & Ors 1990 (1) Bombay Cases Reporter 386 (389 para 10)
Leave to defend was refused where the defendant in various letters admitted the correctness of the amount claimed by the plaintiff. Corporate Voice Pvt Ltd versus Union Leather India Ltd 60 (1995) Delhi Law Times321 (323 para 8).
Money Claims based debt due under dishonour of cheque
Where the defendant applied for setting aside ex parte decree in summary suit based on dishonoured cheque on the ground that the plaintiff had suppressed material facts to the effect that the plaintiff had not disclosed his complaint under section 138 of the Negotiable Instruments Act, in the plaint and that plaintiff had received a sum of Rs.90,000/- as compensation out of fine imposed on the defendant in the said criminal complaint, it was held that" the suppression of the material facts has to be such which would materially affect the decision of case. The pendency of criminal complaint could have no bearing on the merits of the claim of the plaintiff in the summary suit. The law permits the plaintiff to take out both civil and criminal proceedings. Both proceedings can be continued simultaneously. Both remedies are independent of each other. The Court declined to set aside the ex parte decree. Vijay Kumar versus Govind Bhai 1999 (4) LJ 14 (para 5)
Money Claims based on Promissory Notes
Where in a suit on promissory note the defendant admitted his signature on promissory note but alleged that he had executed blank promissory note in favour of one broker who did not return the said promissory note after the defendant cleared his liability and where he alleged that he had never seen the plaintiff and never borrowed any money from plaintiff and where the trial Court refused to grant leave to defend the suit, it was held that the trial Court was justified in refusing the leave to defend the suit as the defendant had not taken any such plea in first instance which he could have very easily done by replying the registered notice. S Anand versus S Aruna 2000 AIHC 4372
In M/s. Aganall Traders Ltd. v. Shyarn Ahuja, the suit was filed on the basis of dishonoured cheque and promissory note and written agreement. In leave to defend application the defendant inter alia pleaded that a sum of Rs. 5 lacs was withdrawn from bank and paid in cash to the plaintiff for which no receipt was issued by the plaintiff. It was held that the defence taken by the defendant by no stretch of imagination can be said to be fair, bona fides or reasonable and that the defence was totally frivolous, false, illusory or sham or practically a moonshine. Leave to defend was refused and the decree was passed against the defendant. AIR 1999 Delhi 369 (371)
Depending upon the nature of your claim, apply relevant heading in your notice and delete rest of headings.
(B) Also, take notice that I/we may institute Insolvency Petition against you. I/we am/are taking opinion from Senior lawyers in this regard and if the law permits, then I/we will also file Insolvency Petition against you.
(C) I /we also thought it fit to inform you about some of the Supreme Court Judgments aboutInstitution of both civil and criminal proceedings in commercial transactions.
The Hon'ble Supreme Court has extensively dealt with the issue which involves both Civil and Criminal remedies. In M/s. Indian Oil Corporation v. M/s. NEPC India Ltd. and Ors., 2006 (6) Supreme 66 : AIR 2006 SC 2780, in which the Apex Court has formulated various guidelines, after referring to its earlier decision.
"A given set of facts may make out: (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial transaction or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, may also involve a criminal offence.
As the nature and scope of a civil proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not."
5) Having said above, however, it is seen that the threat of court litigation hardly instil fear in the minds of offenders of law. Lawyers and litigants known to blatantly misrepresent facts, frequently make inconsistent statements and utter obvious lies in court, to prolong the litigation.
Nevertheless, I/we may inform you that there are ample provisions in Indian Penal Code 1860 to deal with whoever interferes in the administration of justice and provides for both imprisonment and fine for such interference. Sometimes Courts invoke its Contempt jurisdiction to punish those who mislead the court by filing false affidavit. I/we will not hesitate to invoke applicable provisions of law if there is any mischief with the administration of justice is undertaken.
- Section 172 of Indian Penal Code declares that when a Public Servant who is authorized to issue, issues a legal Summon or Notice or Order, against a person and that person absconds or avoids to receive that legal Summon or Notice or Order, commits offence under this section. Primary meaning of the word “absconds” is to hide and when a person is hiding from his place of residence, he is said to be absconding. A Judge is a Public Servant within the meaning of section 21 of Indian Penal Code.
The punishment: for this offence is imprisonment which may extend to one month to six month, or may be with Fine ranging from Rs.500 to Rs.1000 or may be punished both with imprisonment & fine.
Case Law: A person may hide even in his place of residence or away from it and in either case he would be absconding, when he hides himself. K T M S Abdul Kader versus Union Of India 1977 CrLJ 1708.
- Section 174 of Indian Penal Code declares that When a Public Servant who is authorized to issue, issues a legal Summon or Notice, or Order or Proclamation, to call upon a person to attend in person or through agent, at a particular place and at particular date, and the person in receipt of that legal Summon or Notice, or Order or Proclamation, intentionally / deliberately omits to attend, in person or through agent, that place on that date, commits offence under this section.
The punishment for this offence is imprisonment which may extend to one month to six month, or punishment may be with Fine ranging from Rs.500 to Rs.1000 or may be punished both with imprisonment & fine.
- Section 181 of Indian Penal Code declares that- when a person, who is under legal obligation, knowingly make any statement, on Oath, or by affirmation, before a Public Servant, statement which he knew that it is false or statement which he believes that it is not true, and when he is bound to state the truth, commits the offence under this section.
The punishment for this offence is imprisonment which may extend to three years, and will also be fined.
- Section 191 of Indian Penal Code declares that when a person, who is under legal obligation, either on oath or under any provision of law, to state the truth, to declare upon any subject, knowingly makes false statement, the statement which he believes that it is false or he believes that it is not true, commits the offence under this section.
The punishment for this offence is imprisonment which may extend to Seven years, and will also be fined.
Case Law: Offences relating to making false statement in the sworn Affidavits comes within the purview of this section.
Kori Gope versus Manmohan Das, AIR 1928 Pat 161 : 29 CrLJ 111 : 106 IC 703
Ranjit Singh versus State of PEPSU, AIR 1959 SC 843 : 1959 CrLJ 1124
Written statements and applications: A person filing a written statement is bound by law to state the truth and if he makes a statement which is false to his knowledge or belief, or which he believes not to be true, he is guilty of this offence. Mehrban Singh (1884) 6 All 626, Padam Singh, (1930) 52 All 856.
- Section 196 of Indian Penal Code declares that when a person give or attempt to give any evidence as true or genuine evidence, knowing that the evidence he is giving is false or fabricated, to obstruct in the course of justice, commits the offence under this section.
The punishment for this offence is imprisonment which may extend to Seven years, and will also be fined.
- Section 199 of Indian Penal Code declares that when a person, voluntarily makes a declaration to a Court or to any public Servant, who are bound to take such declaration as evidence, and the person knowingly makes false statement in such declaration, the statement which he believed it to be false or he believed it to be not true. Also, the false statement so made must touch a point material to the object of such declaration, commits the offence under this section.
The punishment for this offence is imprisonment which may extend to Seven years, and will also be fined.
Case Law: False Affidavit: M S Jaggi 1983 CrLJ 1527 (Ori)
Deputy GM Inter State Bus Terminal versus Smt Sudarshan Kumari, 1997 CrLJ 1931 (SC) : AIR 1997 SC 1902 : 1997 (3) SCC 496 : Gadhi versus Krishnaraja, 2000 CrLJ 1590 (Mad)
Baddu Khan versus Emperor, AIR 1928 All 182 : 29 CrLJ 336
It deserves mention here the observations of Hon’ble Supreme Court in T. Arivandandam v. T. V. Satyapal reported in (1977) 4 SCC 467 : (AIR 1977 SC 2421):
"We have not the slightest hesitation in condemning the petitioner for the gross abuse of the process of the court repeatedly and unrepentantly resorted to. From the statement of the facts found in the judgment of the High Court, it is perfectly plain that the suit now pending before the First Munsif's Court, Bangalore, is a flagrant misuse of the mercies of the law in receiving plaints...... if on a meaningful -- not formal -- reading of the plaint it is manifestly vexatious, and meritless, in the sense of not disclosing a clear right to sue, he should exercise his power under Order VII, Rule 11. C. P. C. taking care to see that the ground mentioned therein is fulfilled.The Penal Code is also resourceful enough to meet such men, (Ch. XI) and must be triggered against them.
Also, take notice that there are series of SC judgments wherein they have imposed heavy cost on litigants who are found employing dilatory tactics to prolong the litigation. I wish to inform you that in Salem Advocate Bar Association, Tamil Nadu Vs. Union of India (UOI), (2005) 6 SCC 344, the Hon'ble Supreme Court, among other things, has observed and directed “…