Delhi District Court
M/S Engineers India Ltd vs Zoom Developers Pvt. Ltd on 14 December, 2018
IN THE COURT OF PRAVEEN KUMAR: ADDITIONAL
DISTRICT JUDGE05 :NEW DELHI DISTRICT, PATIALA
HOUSE COURTS, NEW DELHI.
Civil Suit No.58262/2016 (Eight Years Old Case)
In the matter of:
M/s Engineers India Ltd.,
A Government Company registered
under the Companies Act, 1956
having its registered office and
interalia carrying on business at
Engineers India Bhawan,
1, Bhikaji Cama Place,
New Delhi110066 ..................Plaintiff
Versus
Zoom Developers Pvt. Ltd.
5th Floor, "Devchand House"
"C" Block, Shivsagar Estate,
Dr. Annie Besant Road, Worli,
Mumbai400017, India .................Defendant
Date of institution of the case : 04.06.2010
Date of arguments : 01.12.2018
Date of judgment : 14.12.2018
JUDGMENT:
1. This is a suit for recovery of Rs.42,13,419/ filed by the plaintiff against the defendant.
2. The case of the plaintiff, in brief, is that plaintiff is a Government company registered under the Companies Act, 1956 and is engaged in the business of rendering consultancy services CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.1 of 11 for setting up large scale projects, designing and consultancy in various fields including engineering, heavy industry, etc. The defendant is a company incorporated under the Companies Act. On 21.07.2008 the plaintiff received an email from the defendant requesting the plaintiff to provide Techno Economic Feasibility Report (in short "TEFR") for setting up a integrated aluminimum complex in Orissa and requested the plaintiff to forward its Techno Commercial proposal for preparation of TEFR for setting up the aluminimum complex in Orissa. On 04.08.2008, the plaintiff submitted to the defendant its Techno Commercial Proposal for preparation of the TEFR and as per clause 8 of the same, the plaintiff quoted its professional fees of Rs.47.60 lakhs. On 08.10.2008 an agreement was arrived whereunder the plaintiff agreed to provide TEFR for various segments of the projects viz. Recovery of ore from bauxite mines, alumina refinery, aluminium smelter, captive power plant etc. At the request of the defendant, the plaintiff agreed to reduce the lump sum price for its services by Rs.1.00 lakhs to Rs.46.60 lakhs. It was also agreed that the plaintiff shall stand committed and be bound to the agreed terms till 31.10.2008. Pursuant to the agreement arrived between the parties, the plaintiff received a letter of intent (in short 'LOI') dated 10.10.2008 from the defendant requesting the plaintiff to provide TEFR as per the scope of service in the said LOI of the defendant. It was agreed that out of the total remunerations of the plaintiff, CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.2 of 11 40% of the total lump sum price was payable as down payment alongwith LOI while the balance 60% of the lump sum payment was payable with 100% taxes and duties before the submission of the draft feasibility report. The balance fee was payable by the defendant to the plaintiff through an irrevocable letter of credit of a bank to be nominated by the plaintiff. On receipt of 40% payment of the total lump sum price, the plaintiff performed its part of the contract and prepared the feasibility report/TEFR. Vide its email dated 11.08.2009 the Metallurgy Division of the plaintiff intimated the defendant of the readiness of the draft report for the assignment. On 31.12.2008 the plaintiff raised upon the defendnat its invoice bearing no.6983HL002 dated 31.12.2008 for a sum of Rs.31,41,585/ towards the balance 60% of the professional remunerations as per agreed terms, so as to enable the plaintiff to issue the draft report. Vide email dated 21.07.2009 the plaintiff informed the defendant that draft report was lying ready for issue. It is averred that despite several reminders sent by the plaintiff to the defendant, the defendant failed to pay the balance 60% of the plaintiff's remunerations which, as per the agreed terms, was a condition precedent for the plaintiff to submit its draft TEFR to the defendant. It is averred that the defendant is liable to pay to the plaintiff the balance amount of Rs.31,41,585/ in terms of the invoice dated 31.12.2008, mentioned above. Besides the above, the defendant is CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.3 of 11 also liable to immediately deliver to the plaintiff the TDS certificate for the sum of Rs.2,15,722/ or in lieu thereof, the amount of TDS. It is averred that a sum of Rs.42,13,419/ is due and payable by the defendant which the defendant has failed to pay despite service of demand notice dated 10.03.2010. The plaintiff has prayed the suit of the plaintiff be decreed.
3. Defendant has file the written statement and has contested the suit. Defendant has taken preliminary objections (i) that the present suit is not maintainable and (ii) that this court has no jurisdiction to try and entertain the present suit. On merits, it is averred that there is neither any agreement between the parties nor there is any amount due to the plaintiff, as claimed in the suit. The defendant has denied that the various emails, allegedly sent by the plaintiff to the defendant. It is specifically denied that on 21.07.2008 an email was sent to the plaintiff by the defendant to provide TEFR, as alleged. The defendant has also denied receiving any Techno Commercial Proposal on 04.08.2008. However, the defendant has admitted that one or two meetings were held between the parties in the month of August/September, 2008. The defendant has also denied issuance of any LOI, as alleged. As regards payment of Rs.18,64,000/ by the defendant to the plaintiff, the defendant has taken the stand that the said advance payment was made in terms of discussions and oral instructions of the plaintiff. It is averred that no work was started CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.4 of 11 by the plaintiff though the plaintiff was obliged to give it's final report within twelve weeks. It is averred that the plaintiff failed to provide the final report within stipulated time scheduled as discussed between the parties. The defendant has denied that the abovesaid payment was made by the defendant in pursuance to invoice dated 17.10.2008. All other allegations have been denied. Defendant has prayed that the suit of the plaintiff be dismissed.
4. The plaintiff has filed the replication and has reiterated the facts of the plaint.
5. Vide order dated 18.05.2015 following issues were framed:
(i) Whether the suit has been signed and filed by a duly authorized person? OPP.
(ii) Whether this Court does not have the territorial jurisdiction to entertain/try the present suit as stated in preliminary objection No.2 of the written statement? OPD.
(iii) Whether there was an agreement between the parties whereunder the services of plaintiff were availed by the plaintiff to prepare and provide a Techno Economic Feasibility Report (in short "TEFR) for setting up an integrated aluminium complex is Orissa for the defendant? OPP.
(iv) Whether the plaintiff prepared the Techno Economic Feasibility Report (TEFR) at the request of the defendnat?
CS No.58262/2016M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.5 of 11 OPP.
(v) Whether the plaintiff is entitled to a decree of Rs.42,13,419/ as claimed in suit? OPP.
(vi) Whether plaintiff is entitled to interest, if so, at what rate and for which period? OPP.
(vii) Relief.
6. Plaintiff in support of his case has examined Sh. K.G.K Patro as PW1 and Sh. Manish Chandra Pathak as PW2. They have deposed on the lines of the averments made in the plaint.
7. PW1 has deposed that he is wellconversant with the facts of the present case on the basis of the records maintained by the plaintiffcompany and also on the basis of his personal knowledge. He has proved the following documents:
(i) Email dated 21.07.2008 as Ex.PW1/1;
(ii) Plaintiff's letter dated 04.01.2008 along with Techno Commercial Proposal as Ex.PW1/2 and Ex.PW1/3;
(iii) Record of Notes of the Meeting held on 08.10.2008 as Ex.PW1/4;
(iv) LOI dated 10.10.2008 as Ex.P3;
(v) Copy of invoice dated 17.10.2008 as Ex.P1;
(vi) Work order dated 01.11.2008 and its duplicate copy as Ex.P4 and Ex.PW1/5 respectively;
(vii) Copy of the letter dated 08.12.2008 as Ex.P5;
CS No.58262/2016M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.6 of 11
(viii) Copy of invoice dated 31.12.2008 as Ex.P2;
(ix) Copies of the various emails duly certified u/S 65B (4) of the Indian Evidence Act as Ex.PW1/6 to Ex.PW1/16;
(x) Certificate u/S 65 of the Indian Evidence Act as Ex.PW1/17;
(xi) Original TEFR report as Ex.PW1/18;
(xii) Copy of legal notice dated 10.03.2010 with postal receipts as Ex.PW1/19 and Ex.PW1/19 to Ex.PW1/21 respectively.
8. PW2 has deposed that Sh. S.S. Fonia who has signed, verified and instituted the present suit was/is authorized to do so by virtue of subdelegations of powers upon him vide order dated 24.10.2007. He has proved the said order as Ex.PW2/1. He has further deposed that on 04.08.2008, the plaintiff submitted to the defendant its Techno Commercial Proposal for preparation of TEFR. He has proved the notice dated 21.03.2014 with postal receipts as Ex.PW2/2 to Ex.PW2/4.
9. I have heard arguments in the present case. Ld. Counsel for the plaintiff has contended that the plaintiff has proved its case and, therefore, the suit of the plaintiff is liable to be decreed.
10. I have gone through the file. My issuewise findings are as under : CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.7 of 11 Issue No.1 :
11. The onus of this issue is on the plaintiff. From the testimony of PW2 it has been proved that Sh. S.S. Fonia who has signed, verified and instituted the present suit was authorized to do so by virtue of subdelegations of powers upon him vide order dated 24.10.2007 made pursuant to the provisions of Item 16.1 of the scheduled of delegation of powers by the Board of Directors to the Managing Director, the Chairman and Managing Director. He has also deposed that Sh.S.S. Fonia was also the principal officer looking after the legal matters of the plaintiffcompany and was also conversant with the facts of the present case. PW2 has proved the order dated 24.10.2007 as Ex.PW2/1. From the testimony of PW2 it has been proved that the suit has been signed and filed by a duly authorized person. Hence, this issue is decided in favour of the plaintiff and against the defendant.
Issue No.2 :
12. The onus of this issue is on the defendant. The defendant has not led any evidence to prove that this court does not have the territorial jurisdiction to try and entertain the present suit. PW1 has deposed that the email dated 21.07.2008Ex.PW1/1 was received at the registered office of plaintiff which is in New Delhi from the defendant. As per PW1, meetings between the parties took place on 08.10.2008 at New Delhi. From the testimony of PWs, it has been proved that this court has the CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.8 of 11 territorial jurisdiction to try and entertain the present suit. Hence, this issue is decided against the defendant and in favour of the plaintiff.
Issue No.3, 4 & 5 :
13. Since these issues are interlinked. They are being decided together. The onus of these issues is on the plaintiff. The plaintiff has filed the present suit for recovery of Rs.42,13,419/. The suit amount includes a sum of Rs.31,41,585/ being the balance 60% of the lump sum fee/price/professional fee for the TEFR. From the testimony of PW1 it has been proved that the said TEFR was prepared by the plaintiffcompany at the request made by the defendant for setting up an integrated aluminium complex in Orissa which was proposed to be set up by the defendant. PW2 has proved the notice dated 21.03.2014 which was served by the plaintiff upon the defendant to produce the original documents. The defendant was called upon to produce the originals of letter dated 04.08.2008 along with Techno Commercial Proposal vide noticeEx.PW1/1. Despite the service of notice, the defendant did not produce the same.
14. From the testimony of PW1, it has been proved that the total remunerations settled between the parties for the preparation of TEFR was agreed at Rs.46.60 lakhs, out of which 40% of the total lump sum price/fee was payable as down payment along with the LOI, while the balance 60% of the lump CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.9 of 11 sum fee was payable with 100% taxes and duties before the submissions of the draft TEFR. The defendant in the written statement has not denied the payment of Rs.18,64,000/ to the plaintiff. The defendant has taken the stand that the said amount was paid as an advance payment in terms of the oral instructions by the plaintiff to start the work. However, no evidence has been led by the defendant to prove its defence. As per PW1, the plaintiff raised its invoice for a sum of Rs.20,94,393/ representing 40% of the lump sum price. Had there been no such agreement between the parties as deposed by PW1, the defendant would not have made a payment of Rs.18,64,000/ to the plaintiff. No counter claim has been filed by the defendant to receive the said sum from the plaintiff. It is the case of the plaintiff that on receiving the abovesaid payment, the plaintiff proceeded to prepare the TEFR. The plaintiff prepared the TEFR and raised the invoice for the balance 60% of the professional remunerations amounting to Rs.31,41,585/. It has been proved that the TEFR had been prepared by the plaintiff for the specific requirements of the defendant as per its obligations under the contract. The plaintiff has produced before the court the said TEFREx.PW1/18. The TEFR prepared by the plaintiff has the value of Rs.46.60 lakhs. From the perusal of testimony of witnesses, it has been proved that plaintiff has performed its part of the obligations under the contract for preparing TEFR. The defendant has CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.10 of 11 committed the breach of the contract by not making payment of the balance 60% of the price/lump sum fee as per the agreed terms. Therefore, the plaintiff is entitled to a decree of Rs.42,13,419/ as claimed in the plaint. Hence, these issues are decided in favour of the plaintiff and against the defendant.
Issue no.6 :
15. The onus of this issue is on the plaintiff. The plaintiff is entitled to pendente lite and future interest @ 8% p.a. till realization. This issue is decided accordingly.
Relief :
16. As I have decided all the issues in favour of the plaintiff and against the defendant, the suit of the plaintiff is decreed for a sum of Rs.42,13,419/ with costs. The plaintiff shall further be entitled to pendente lite and future interest @8% p.a. till realization. Decree sheet be prepared accordingly. File be consigned to Record Room after due compliance.
Digitally signed by PRAVEEN PRAVEEN KUMAR
KUMAR
Date: 2018.12.15
02:58:34 +0530
Dictated and announced in (PRAVEEN KUMAR)
open court today i.e. on 14.12.2018. Additional District Judge05, NDD,Patiala House Courts, New Delhi. (R) CS No.58262/2016 M/s Engineers India Ltd. Vs. Zoom Developers Pvt. Ltd. Page No.11 of 11