$~76 * IN THE HIGH COURT OF DELHI AT NEW DELHI + RFA 44/2026, CM APPL. 2675/2026 (Exemption), CM APPL. 2676/2026 (delay) MICHAEL .....Appellant Through: Counsel for Appellant (appearance not given). versus DHIRAJ NATH SHARMA .....Respondent Through: None CORAM: HON'BLE MS. JUSTICE NEENA BANSAL KRISHNA O R D E R % 15.01.2026 1. Regular First Appeal under Section 96 read with Order XLI Rule 1 of the Code of Civil Procedure, 1908 (hereinafter referred to as “CPC”) has been filed to challenge the Judgement dated 24.09.2025, whereby the Leave to Defend Application filed by the Appellant/Defendant, Michael has been dismissed and the Suit of the Respondent/Plaintiff, Dhiraj Nath Sharma for Recovery of Rs.5 lacs alongwith interest at 9 % p.a., has been decreed. 2. Brief facts are that the Plaintiff/Respondent filed a Suit under Order XXXVII CPC for recovery of Rs.5 lacs on the basis of a cheque, Loan Agreement, Declaration Certificate and Receipt dated 05.12.2024. The Plaintiff/Respondent asserted that he was a Licence holder and carried on the business of money lending within the area of the NCT of Delhi. He used to advance cash/mobile banking loans. 3. The Defendant/Appellant, who is a Senior Dresser in Indraprastha Power Generation Co. Ltd., was acquainted to the Plaintiff/Respondent for many years. He, alongwith his wife, took the loan of Rs.1,40,000/- This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 31/01/2026 at 14:36:01 alongwith interest @ 2% per month, from the plaintiff, on 21.12.2022. His wife, Mrs. Savita Chauhan, stood as Surety. The Loan Agreement, Declaration Certificate, Pro-Note receipts and Pro-Note Receipt dated 21.12.2022 was executed in acknowledgement of this loan transaction. Apart from this, the Defendant also took the cash loans from time to time, for which the Appellant executed the Pro-Note receipts as under: Date Amount (in Rs.) Mode of Payment 10.01.2023 80,000/- Cash 22.02.2023 100,000/- Cash 12.05.2023 70,000/- Cash 25.07.2023 50,000/- Cash 4. The Defendant/Appellant thus, took a total loan of Rs.4,40,000/- from the Plaintiff/Respondent at an interest @ 2% per month. The Defendant/Appellant paid interest in sum of Rs.80,000/- in cash and he lastly paid the interest on 01.02.2024. 5. The Defendant/Appellant had issued a cheque dated 06.09.2023 for a sum of Rs.4,25,000/-, which got dishonoured, for which a Legal Notice dated 03.10.2023 was served on the Defendant. Pursuant thereto, the Defendant paid an interest of Rs.8,500/- on the loan amount of Rs.4,40,000/. Thereafter, the Defendant paid the interest to the Plaintiff, till 10.02.2024. 6. As on the date of filing the Suit, there was a principal sum of Rs.4,40,000/- and approximately Rs.70,000/- as interest due till 05.12.2024, from the Appellant. 7. The Defendant/Appellant issued a cheque dated 05.12.2024 in the sum of Rs.5 lacs, in discharge of his loan liability. However, the cheque on This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 31/01/2026 at 14:36:01 presentation, was dishonoured on 10.12.2024 with the remarks “Payment stopped by drawer”. The Defendant/Appellant failed to pay the loan amount despite due service of a Legal Notice of Demand dated 19.12.2024. Hence, the Suit for Recovery under Order XXXVII CPC was filed by the Respondent, for recovery of Rs.5 lacs alongwith pendent lite and future interest @ 2% per month. 8. The Defendant/Appellant, on being served with Summons, filed the Leave to Defend Application wherein he denied having taken any loan from the Plaintiff/Respondent or signing any Agreement thereto. 9. A preliminary objection has been taken by the Appellant that as per the Plaintiff/Respondent himself, he is in the business of money lending, but Section 3 of the Money Lenders Registration Act mandates a licence for being a Money Lender. The Respondent has no valid licence and therefore, the entire alleged transaction of giving a loan to the Respondent to the Appellant, is false and bogus. There is no loan in fact taken by the Appellant and the Suit was liable to be dismissed. 10. It was further claimed that he had given blank security cheques to Neeraj, the brother of the Plaintiff/Respondent, who had misused the cheque by filling an amount of Rs.5 lacs in the cheque. Thereafter, he has been blackmailing the Appellant. 11. Furthermore, while the Plaintiff/Respondent claimed that the Defendant/Appellant had issued two cheques which got dishonoured, but he has not filed any Complaint under 138 N.I. Act, which reflects that a sham Suit for Recovery has been filed by the Respondent. The Suit under Order XXXVII CPC can be filed only when there is an undisputed claim and the Defendant admits his liability towards the Plaintiff. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 31/01/2026 at 14:36:01 12. The Learned District Judge considered the defences taken by the Appellant and observed that the signatures on all the documents, i.e. the Promissory Notes, Receipts, etc., were not denied by the Defendant/Appellant. The only defence taken was that he had taken a loan from the brother of the Respondent and had signed blank documents, which had been misused by the Plaintiff/Respondent. The screenshots of payments made by the Defendant/Appellant to the brother of the Plaintiff/Respondent, were found to be untenable, to deny the claim of the Plaintiff/Respondent. 13. It was held that the transaction, if any, between the Defendant/Appellant and the brother of the Plaintiff/Respondent did not discredit the loan given by the Plaintiff/Respondent, for which documents were duly executed. Not filing of Complaint under 138 N.I. Act in respect of dishonour of two cheques, does not in any way weaken the claim of the Plaintiff/Respondent. It was concluded that there was no triable issue raised and the Leave to Defend was dismissed and the Suit of the Plaintiff/Respondent was decreed. 14. The main ground of challenge raised in the Appeal is that there were triable issues raised by the Defendant/Appellant in its Leave to Defend Application and the same could not have been ignored and overlooked. The Leave to Defend Application has been rejected on surmises and conjectures, which is not supported by any legal, valid and admitted principles of law. 15. The Plaintiff/Respondent has failed to show as to how the amount of Rs.5 lacs in total, is an undisputed claim as the Defendant/Appellant has nowhere admitted the liability. In fact, the loan of Rs.70,000/- was taken from the brother of the Plaintiff/Respondent, which already stands paid. The This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 31/01/2026 at 14:36:01 Appellant has been trapped by the Plaintiff/Respondent whereby the blank documents on which the signatures were taken, have been misused. Hence, the impugned Order be set aside. Submissions heard and record perused. 16. The first ground taken by the Defendant/Appellant is that in fact, he had taken a loan of Rs.70,000/- from the brother of the Plaintiff/Respondent, which he has duly discharged along with interest. In support thereof, he had relied on six screenshots. 17. The learned District Judge has rightly noted that the Defendant/Appellant may have had some loan transaction with Neeraj Nath, brother of the Plaintiff/Respondent, but that in itself cannot be a reason for the Defendant/Appellant, to have not taken the loan from the Plaintiff/Respondent as well. There being two different individuals and two transactions, merely taking of loan from the brother, can in no way create a doubt on the loan transactions as claimed by the Plaintiff/Respondent. This defense was, therefore, is not tenable. 18. The second ground taken on behalf of the Defendant/Appellant was that when he took a loan of Rs.70,000/- from Neeraj Nath, he was made to sign various blank documents which have been subsequently converted into Promissory Notes, Receipts etc. It is evident from the submissions made by the Defendant/Appellant himself that the signatures on the documents are not disputed. It is clearly a sham defense merely to wriggle out of the documents created at the time of taking of loan. These documents duly support and witness the loan transactions between the Plaintiff/Respondent and the Defendant/Appellant. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 31/01/2026 at 14:36:01 19. It cannot be overlooked that there was a cheque of Rs.4,40,000/- issued by the Defendant/Appellant to the Plaintiff/Respondent which got dishonored. Thereafter, another cheque of Rs.5 lacs was issued, which also got dishonored. There is no explanation forthcoming as to why did the Defendant/Appellant issued cheques not once but on two occasions, in favor of the Plaintiff/Respondent. 20. To discredit these cheques, the Appellant has contended that no Complaint under Section 138 N.I. Act was filed in respect of dishonor of these two cheques, but this contention is of little consequence. When the law gives more than one remedy to the Plaintiff, it is his choice to avail whichever suits him the most. Merely because the Plaintiff/Respondent did not resort to Criminal Complaint under Section 138 N.I. Act, cannot be any ground to discredit various documents and the cheques executed by the Defendant/Appellant, in favor of the Plaintiff/Respondent. 21. The learned District Judge rightly concluded that there was no triable issue raised in the Leave to Defend Application and in decreeing the Suit of the Plaintiff/Respondent under Order XXXVII CPC for a sum of Rs.5 lacs alongwith interest @ 9% p.a. from the date of filing of the Suit till the date of realization of the amount. 22. The Appeal is accordingly dismissed. 23. Pending Applications, if any, are also dismissed. NEENA BANSAL KRISHNA, J JANUARY 15, 2026 N This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 31/01/2026 at 14:36:01