### Summary Account Confirmation Signed by a Deponent Constitutes a Written Contract Under Order XXXVII CPC The High Court of Delhi affirmed that a Confirmation of Accounts, signed by the debtor, serves as a "written contract" for the purposes of a summary suit, rendering a bare plea of "signing under duress" a sham defence. The Court further clarified that while granting interest is discretionary under Section 34 CPC, future interest should generally be awarded in commercial disputes to compensate for the time value of money until actual realization.

The Plaintiff (Zavenir Developers) filed a summary suit under Order XXXVII of the CPC for the recovery of ₹50,00,000/- advanced as a friendly loan to the Defendant, a Chartered Accountant, in September 2018.

The Plaintiff relied on a "Confirmation of Accounts" dated 01.04.2019, signed by the Defendant, which acknowledged the loan and an agreed interest rate of 15% p.a. compounded quarterly.

The Defendant contested the suit, seeking leave to defend on the grounds that the money transferred via bank was actually a repayment of a prior cash loan he had arranged for the Plaintiff’s directors.

The Trial Court dismissed the Leave to Defend application, finding the defense to be a "sham," and decreed the suit for the principal plus 9% p.a. pendente lite interest, but denied future interest.

Both parties appealed: the Defendant against the dismissal of his leave to defend (RFA 361/2024), and the Plaintiff against the reduction of interest and denial of future interest (RFA 718/2024).

1. Whether the Defendant raised a triable issue or a bona fide defense sufficient to grant Leave to Defend under Order XXXVII Rule 3(5) of the CPC.

2. Whether an "Acknowledgement/Confirmation of Accounts" can be treated as a "written contract" for the purposes of a summary suit under Order XXXVII.

3. Whether the Plaintiff is entitled to future interest and the contractually agreed rate of interest under Section 34 of the CPC.

The Court applied Order XXXVII of the CPC, which allows for summary judgments on liquidated demands arising from written contracts.

It relied on the definition of "acknowledgment" from Khan Bahadur Shapoor Freedom Mazda v. Durga Prosad Chamaria, noting that a clear admission of debt constitutes a liability.

The Court further applied the principles from FCI v. Bal Kishan Garg and M/s Sakata INX (India) Ltd. v. M/s Rexor India Limited, establishing that a signed "Confirmation of Accounts" containing terms of interest and consideration functions as a "written contract".

Regarding interest, the Court applied Section 34 of the CPC and the Constitution Bench ruling in Central Bank of India v. Ravindra, which holds that while pre-suit interest is governed by contract, pendente lite and future interest are subject to judicial discretion based on equity and commercial norms.

The Court found that the Defendant’s plea—that the bank transfers were repayments of an undocumented cash loan—lacked evidence and source-disclosure, rendering it a "sham and moonshine" defense intended to delay proceedings.

The Defendant, being a Chartered Accountant, could not plausibly argue he signed the Confirmation of Accounts under duress or without understanding its legal implications.

The Court held that the "Confirmation of Accounts" dated 01.04.2019 satisfied all elements of a contract (offer, consideration, and signed acceptance), justifying the summary procedure.

Regarding interest, the Court upheld the Trial Court's discretion to reduce the pendente lite rate to 9% simple interest, noting it was not arbitrary.

However, the Court found the total denial of future interest legally untenable under Section 34 CPC, as the Plaintiff was entitled to compensation for being deprived of the use of money until actual payment.

It partly allowed the Plaintiff’s appeal (RFA 718/2024), modifying the decree to include future interest at 9% p.a. simple interest from the date of the decree until the date of actual payment.

The Court held that while the rate of interest is discretionary, the deprivation of funds necessitates post-decree interest to meet the ends of justice.