Prem Prakash Modi vs M/S Absolute Catering Services & Anr

* IN THE HIGH COURT OF DELHI AT NEW DELHI
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Judgment reserved on: 24 August, 2026
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Judgment pronounced on: 29 October, 2026
# CNR No. DLHC010118562016
+ RFA 67/2016 & CM APPL. 81531/2025
PREM PRAKASH MODI .....Appellant
Through: Mr. Hitender Kapur and Mr. Yatin
Dhawan, Advocates.
versus
M/S ABSOLUTE CATERING SERVICES &
ANR .....Respondents
Through: Mr. R.K. Rathore, Mr. Rakesh
Chander Agrawal and Mr. Kartik
Kumar Agarwal, Advocates.
CORAM:
HON'BLE MR. JUSTICE AMIT BANSAL
JUDGMENT
AMIT BANSAL, J.
1. This appeal has been filed under Section 96 read with Section 151 of
the Code of Civil Procedure, 1908 (‘CPC’) against the judgment and decree
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dated 28 November, 2015 passed in Suit No. 329/2013 titled ‘ Prem
Prakash Modi v. M/s Absolute Catering & Anr. ’ by the Court of Additional
District Judge - 03, Central District, Tis Hazari Court, Delhi (‘Trial Court’).
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2. The present appeal impugns the judgment and decree dated 28
November, 2015 passed by Trial Court whereby the suit filed by the
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appellant/plaintiff for recovery of a sum of Rs.10,00,000/- along with
pendente lite and future interest was dismissed.
B RIEF F ACTS
3. The appellant herein is the proprietor of M/s Murari Lal Prem Prakash
and has been engaged in business of sale of kiryana items. It is the case of
the appellant that respondent no.1, through respondent no.2 approached the
appellant seeking financial help. The appellant agreed to advance a loan of
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Rs.10,00,000/- and, accordingly, on 27 January, 2012, the said amount was
transferred by the appellant through banking channels to the account of
respondent no.1. The amount so advanced was described as a friendly loan.
In September 2013, the appellant demanded repayment of the loan amount.
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A legal notice dated 20 November, 2013 was issued by the
plaintiff/appellant to the respondents demanding repayment of
Rs.10,00,000/-. However, the same was returned as the
defendants/respondents were not available at the said address.
4. A suit for recovery of Rs. 10,00,000/- were instituted by the
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appellant/plaintiff against the respondents/defendants on 12 December,
2013. The defendants/respondents entered appearance and filed their
common written statement.
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5. The Trial Court framed the following issues vide order dated 25
November, 2014:
i) Whether the plaintiff is entitled for the recovery of the suit
amount of Rs.10,00,000/- along with interest @ 18% p.a., as prayed
or if any, what amount with what interest, at what rate and for what
period?
ii) Whether there is no cause of action in the suit?
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iii) Whether the plaint has not been properly signed and verified by
the competent and authorised person?
6. After filing the written statement, the defendants/respondents failed to
appear in the suit. Accordingly, the defendants/respondents were proceeded
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ex parte vide order dated 6 February, 2015.
7. Issue no.(ii) and issue no.(iii) were decided in favour of the
plaintiff/appellant and against the defendants/respondents.
8. Trial Court decided the principal issue no.(i) against the
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plaintiff/appellant and dismissed the suit vide judgment dated 28
November, 2015.
9. In relation to issue no.1, the Trial Court held that the reference in the
written statement to adjustment of a pending amount could not, in the
circumstances of the case, be treated as an admission of the alleged friendly
loan, particularly in view of the specific denial of the loan transaction in the
written statement.
10. The Trial Court further found that Form No.16A (Mark ‘A’), was in
the name of M/s Madan Lal Shyam Sunder, which entity was not impleaded
as a party to the suit. The Trial Court therefore did not find the said
document sufficient to establish a nexus between the interest reflected
therein and the alleged loan advanced to respondent no.2.
11. Additionally, the Trial Court found that the appellant/plaintiff’s
evidence did not sufficiently identify the person to whom the alleged loan
had been advanced to. It was noticed that the suit impleaded both M/s
Absolute Catering Services and Himanshu Goel, whereas the evidence
referred to the loan having been advanced to respondent no.1 after it had
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approached the plaintiff through respondent no.2. The Trial Court also
noticed the absence of pleadings explaining the basis of the personal liability
of respondent no.2 for the alleged loan.
12. Trial Court further held that the statement of account, being a
computer-generated copy, had not been proved in accordance with Section
65-B of the Indian Evidence Act, 1872. In the absence of the original
account books and other supporting material, the Trial Court declined to rely
upon the said statement for establishing the alleged advancement of the loan.
Reliance was placed on the decisions in Gopal Krishnaji Ketkar v. Mohamed
Haji Latif & Ors. , AIR 1968 SC 1413; Parasnath Hiral Lal v. Kishan Lal
Chuni Lal , AIR 1965 All 189; Trimbak Narayan Hardas v. Babu Lal Motaji ,
AIR 1973 SC 1363
13. Aggrieved by the aforesaid finding, the appellant filed the present
appeal.
S UBMISSIONS ON BEHALF OF THE APPELLANT
14. A friendly loan of Rs.10,00,000/- was advanced to the respondent
no.1. Interest was paid by respondents to the appellant for an initial period
and thereafter the payments stopped. A Form No.16A was also issued in
relation to deduction of tax on the interest amount.
15. The Trial Court erred in discarding the statement of account showing
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transfer of Rs.10,00,000/- on 27 January, 2012 on technical grounds
without appreciating the same in the context of the other evidence on record,
particularly the testimony of PW-1 (appellant/plaintiff) which was
unrebutted. The Trial Court adopted an unduly technical approach in relation
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to the statement of account, despite the fact that the transaction itself was not
effectively challenged by way of cross-examination.
16. Form No.16A proved deduction of tax in respect of interest paid to the
appellant and, therefore, constituted corroborative material supporting the
appellant’s case that interest had in fact been paid upon the loan transaction.
Merely because the Form No.16A was issued in the name of M/s Madan Lal
Shyam Sunder, and the said entity was not impleaded as a defendant, could
not by itself render the document irrelevant. The appellant’s case was that
the document reflected payment of interest upon the very amount advanced
to the respondents and ought to have been considered along with his
unrebutted testimony.
17. The Trial Court also failed to appreciate the contents of the written
statement. The respondents had themselves pleaded that an amount was
“pending” and had sought to explain the same by contending that such
amount had subsequently been adjusted against the value of 50 bags of
cloves lying in cold storage. The existence of the outstanding amount was,
therefore, admitted and the respondents had set up a subsequent oral
settlement to explain why the amount was no longer payable. Since the
respondents neither entered the witness box nor led any evidence to prove
the alleged settlement, the Trial Court ought to have drawn the necessary
consequence from the unrebutted testimony of the appellant and the
admission contained in the written statement.
UBMISSIONS ON BEHALF OF THE RESPONDENTS
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18. The respondent no.1 submits no friendly loan was advanced by the
appellant, rather a business deal was in place. The joint venture run with M/s
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Madan Lal Shyam Sunder had been doing business deals with the appellant.
The proprietor of M/s Madan Lal Shyam Sunder had bought 50 bags of
clove from the appellant which was stored at Narang Cold Storage, Kundli,
Sonipat and the same was illegally withheld by the appellant and Narang
Cold Storage.
19. The appellant and respondent no.1 entered into an amicable settlement
in 2013 where the parties agreed that the pending amount owed to the
appellant by respondent no.1 would be adjusted against the value of the
clove illegally withheld by the appellant and Narang Cold Storage.
20. The books of account as well as the original statement of account have
not been produced to prove the entries in such statement of account. No
certificate was furnished by the appellant in accordance with the Bankers’
Book Evidence Act to prove the entries in the statement of account.
Therefore, the said document is neither proved nor it is admissible in law.
A NALYSIS AND FINDINGS
21. I have heard the counsel for the parties and examined the record of the
case.
22. Both sides have filed written submissions which have been duly
considered.
23. The record of the case reveals that after filing the written statement,
the defendants/respondents stopped appearing in the suit.
24. The plaintiff/appellant filed his affidavit of evidence, which remained
unrebutted as the respondents failed to cross-examine the appellant. Further,
the respondents did not lead any evidence on their behalf.
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25. In the affidavit of evidence filed by the appellant, it has clearly been
stated that a sum of Rs.10,00,000/- was advanced by the appellant to the
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respondents on 27 January, 2012 as a friendly loan.
26. The appellant has also placed on record the bank statement (Mark B)
of Murari Lal Prem Prakash, which is a proprietary concern of the appellant.
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The bank statement shows a debit entry of Rs.10,00,000 on 27 January,
2012, in favour of the defendant.
27. The appellant has also placed on record the TDS Certificate (Mark A)
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dated 30 June, 2012, in terms of which tax was deducted on the interest
payable by the respondents to the appellant. The TDS Certificate clearly
mentions the name of the deductor as Absolute Catering Services Private
Limited, i.e. the defendant no.1.
28. As noted above, the respondents failed to cross-examine the
appellant’s witness and therefore, the aforesaid testimony of the appellant
remained unrebutted.
29. The Trial Court de-exhibited the statement of account filed on behalf
of the appellant on the ground that the original statement was not produced
nor was the statement proved in accordance with law.
30. In the opinion of this Court, the proving of the bank statement would
have been necessary if the respondents had denied the receipt of the sum of
Rs.10,00,000/- from the appellant.
31. The respondents in their written statement, did not deny the receipt of
Rs.10,00,000/- from the appellant and took the defense that the said amount
was to be adjusted towards another transaction between the parties.
Therefore, even if the bank statement was to be disregarded, it cannot be
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denied that the sum of Rs.10,00,000/- was received by the respondents
through the appellant.
32. The Form 16A (Mark A) was also rejected by the Trial Court, as the
same was issued by ‘M/s Madan Lal Shyam Sunder’, which was not a party
in the suit.
33. No doubt, the issuer of the Form 16A was M/s Madan Lal Shyam
Sunder. However, Form No. 16A clearly records the name of the deductor as
Absolute Catering Services Private Limited, i.e. the defendant no.1. Once
again, there was no cross-examination of the appellant’s witness on behalf of
the respondents on this aspect.
34. The appellant in his evidence has also deposed that legal notice dated
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20 November, 2013 was sent to the respondents. However, the same was
returned as the respondents were not available at the said address.
35. The evidence lead on behalf of the appellant clearly reveals that the
respondents had taken a loan and failed to repay the same. There is no
reason to disbelieve the deposition of appellant/plaintiff.
36. The respondents took a defense that the amount transferred by the
appellant was in respect of a business transaction and was settled in 2013
through an amicable settlement between the parties.
37. In light of the defense taken by the respondents in the written
statement, it was incumbent upon the respondents to enter the witness box
and to lead evidence to show that the amount of Rs.10,00,000/- was adjusted
towards another transaction. However, the respondents failed to lead
evidence in this regard. Therefore, the Trial Court ought to have outrightly
rejected the defense taken by the respondents.
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38. In light of the discussion above, it is clear that the appellant had
discharged its onus to prove that the sum of Rs.10,00,000/- was advanced by
the appellant to the respondents, which the defendant failed to repay. On the
other hand, the respondents have failed to lead any evidence to show that the
aforesaid amount was adjusted towards other transaction, in terms of
settlement between the parties.
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39. Accordingly, the impugned judgment and decree dated 28
November, 2015 passed by the Trial Court is erroneous and unsustainable
and is consequently set aside.
40. Resultantly, the suit is decreed in favour of the appellant and against
the respondents for a sum of Rs. 10,00,000/- along with interest @ 6% per
annum, from the date of filing of the suit till the date of realization.
41. Decree sheet be drawn accordingly.
AMIT BANSAL
(JUDGE)
OCTOBER 29, 2026
at
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