SOUTHERN SALES & SERVICES vs SAUERMILCH DESIGN & HANDELS GMBH

The Supreme Court addressed the interpretation of Rule 3, Sub-rule (5) of Order 37 of the Code of Civil Procedure, emphasizing that a defendant must disclose sufficient facts to establish a substantial defense to be granted leave to defend. The Court held that leave to defend should not be refused unless the court is satisfied that the defendant's disclosed facts do not indicate a substantial defense or are frivolous. The appeal was allowed, and the order of the Karnataka High Court was set aside, granting the defendant leave to defend the suit.