Delhi District Court
Suprabhat Electric Co Pvt Ltd vs Lakshmi Bansal on 12 December, 2024
DLCT010107362023
IN THE COURT OF MS. ILLA RAWAT
DISTRICT JUDGE (COMMERCIAL COURT)-03: (CENTRAL)
TIS HAZARI COURTS (EXTENSION BLOCK) : DELHI.
CS (COMM) No. 1131/23
CNR No. DLCT010107362023
In the matter of :-
M/s Suprabhat Electric Co. Pvt. Ltd.,
Through its Director,
Sh. Shwetank Aggarwal
1741, Dariba Kalan,
Chandni Chowk, Delhi-110006.
Mob No.: 09811323232
Email id: [email protected]
.....Plaintiff
Versus
Ms. Lakshmi Bansal,
Proprietor, M/s A.P. Enterprises,
122, Opposite Om Bhojnalya,
Sadar Bazar, Agra- 282001 (U.P.)
Mob. No. 9528712496, 9258020313
email: [email protected]
.....Defendant
Date of Institution : 05.08.2023
Date on which Judgment reserved : 06.12.2024
Date on which judgment pronounced : 12.12.2024
SUIT FOR RECOVERY
CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 1 of 24
Digitally signed
ILLA by ILLA RAWAT
Date:
RAWAT 2024.12.12
16:50:39 +0530
JUDGMENT
1. Vide this judgment I shall dispose of the suit for recovery of Rs.1,30,57,261/-, filed by plaintiff against the defendant.
2. Brief facts of the case as averred in the plaint are that plaintiff is a Private Limited Company incorporated under the provisions of Indian Companies Act, 1956, having its office at 1741, Dariba Kalan, Chandni Chowk, Delhi-110006. Sh. Shwetank Aggarwal, Director of the plaintiff company, has signed and verified the plaint and filed the suit on behalf of plaintiff company. The plaintiff company is stated to be engaged in business of sale and supply of all types of electrical goods i.e. cables, wires and components.
3. The defendant is stated to be a proprietor of the proprietorship firm M/s A.P. Enterprises which is stated to be registered under the Goods and Service Tax Act at Delhi and is engaged in the business of wholesale and retail trading of electrical items i.e. wires, cables, tubes, pipes & hoses, switches, fuses, electrical machineries/equipments, etc.
4. It is averred in the plaint that in the month of October, 2022, the defendant approached the plaintiff company for purchase of various types of cables and wires and placed orders for the same from time to time. The ordered goods were supplied by the plaintiff to defendant against invoices, as detailed in para 4 of the plaint, for a sum of Rs. 1,77,57,261/- till CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 2 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:40 +0530 15.12.2022. As per the terms of payment mentioned in the purchase orders, the defendant was required to make 100% payment within 60 days after receipt of material.
5. It is further averred that the defendant avoided making payment against the goods supplied by the plaintiff and after repeated telephonic and email reminders by the plaintiff company, the defendant made part payment for a sum of Rs.47,00,000/-. The defendant stopped making further payments after 30.01.2023 and failed to pay outstanding amount of Rs.1,30,57,261/- to the plaintiff, despite repeated requests and reminders. Left with no alternative, plaintiff company issued legal notice dated 27.03.2023, through its counsel, to defendant which was duly served upon her. After receipt of the legal notice, the defendant sent reply dated 21.04.2023, through her counsel, denying her liability to make payment of the amount due to the plaintiff company. The plaintiff also initiated pre-institution mediation proceedings, however, the defendants failed to appear despite service of notice due to which a 'Non-Starter Report' dated 26.07.2023 was issued.
6. Thus aggrieved by the acts of defendant, plaintiff has filed the present suit praying that a decree in the sum of Rs.1,30,57,261/- be passed against the defendant alongwith pendant lite and future interest @ 2% per month on said amount alongwith costs of the suit.
7. Defendant has contested the suit by filing written statement. By way of preliminary objection, the claim of plaintiff CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 3 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:36 +0530 has been challenged on the ground that plaintiff failed to supply the goods as per the specification mentioned in the purchase order. It is alleged that the plaintiff supplied defective, inferior and sub-standard materials to defendant and hence the defendant is not liable to make any payment to the plaintiff. It is claimed that the material supplied by the plaintiff was sold by defendant to M/s Daksh Metal Traders, Agra under respective GST invoices, however, the entire material supplied by plaintiff could not pass the test of IS 694:2010, due to which actual consumer/client of the material refuse to make payment. It is further alleged that as per test certificate issued by certified lab namely M/s Akshat Test Lab and Calibration Services, all samples taken out from the materials used in mill/factory Sh.Bhagwan Das Daal Mills could not pass the test IS:694:2010, IS:191:2007 & IS:440:1964, and thus defendant is not liable to make any payment to the plaintiff. It is stated that defendant had duly replied to legal notice received from plaintiff and raised issue about supply of defective, inferior and sub-standard materials by the plaintiff.
8. The territorial jurisdiction of Court to entertain the suit of plaintiff has also been challenged inter-alia on the ground that Sh. Ravi Kant Sharma, representative of the OEM M/s Bonoton had approached the defendant at her office situated in Agra, U.P., where POs were obtained by the official of the OEM and handed over to the plaintiff. The supply of the materials was made to the defendant at Agra, U.P., and hence the Court at Delhi does not have jurisdiction to entertain the suit filed by plaintiff.
CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 4 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:38 +0530
9. The Statement of Truth filed by plaintiff has also been challenged as not being in accordance with Commercial Courts Act. Similarly, the Board Resolution filed by plaintiff is stated to be forged and fabricated and hence the suit is claimed not to have been filed by a duly authorized person.
It is stated that since plaintiff has concealed material facts, it is not entitled to any relief in the present suit and the suit filed by plaintiff ought to be rejected.
10. Besides objections to the maintainability of the suit, defendant has also added preliminary submissions to written statement. It is stated that Sh. Ravi Kant Sharma, Sales Manager, OEM M/s Bonoton had approached the defendant at her office situated in Agra, U.P, and induced her by promising that in case she purchased goods in large quantity payment option would be available within two years from the date of delivery of the goods. Accordingly, defendant agreed to purchase the goods to make supply to her client M/s Daksh Metal Traders, Agra, on the credit for certain month. It was understood that once payment would be made by the client, simultaneously, the same shall be made to the plaintiff. The defendant has given details of bills/invoices vide which it had supplied goods to M/s Daksh Metal Traders in para "C" of the preliminary objections to written statement.
11. It is further averred that in terms of the standard business practice applicable in the electrical industry it is mandatory for each supplier to furnish the test certificate qua the material to be supplied certifying them to be genuine so that all the financial formality in respect of payment from the user can be CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 5 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:37 +0530 sorted out easily. The plaintiff did not supply the test certificate qua the material supplied by it to the defendant, as a result of which, end user got conducted the test itself and result of the same was found negative, due to which entire payment of defendant was not released. The payment which was received by the defendant from M/s Daksh Metal Traders was duly credited to the plaintiff as is reflected from plaintiff's ledger account. Rest of the payment was not made by M/s Daksh Metal Traders and hence defendant is not liable to make any further payment to the plaintiff for defective and sub standard goods supplied by it.
12. It is further averred that defendant kept in regular touch with her client and made request for remaining payment but the said client asked for test certificate certifying the genuineness of the material so supplied as their safety consultant deputed at the site, where goods were used, had asked for it to prepare an audit report qua the electrical items used in factory so as to obtain financial assistance from the bank. The defendant asked Sh. Ravi Kant Sharma and plaintiff to furnish the same several times, but they failed to do so. In the month of March, 2023, owner of M/s Daksh Metal Traders and its consultant communicated to defendant that material so used in their factory did not appear to be genuine and that they would get the same tested from certified lab namely M/s Akshat Test Lab and Calibration Services and only if it passed the test as per standard set out by IS 694:2010, would balance payment be released to defendant. The samples of electrical wires and cables used in the factory of Sh. Bhagwan Das Daal Mills were collected for testing and were sent to M/s Akshat Test Lab and Calibration Services.
CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 6 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:37 +0530 In the month of May 2023, M/s Daksh Metal Traders informed the defendant that the samples taken from factory of Sh. Bahwan Das Daal Mills could not pass the test IS 694:2010, IS:191:2007 & IS 440-1964. In the month of June 2023, M/s Daksh Metal Trades wrote a letter to defendant refusing to process the remaining payment taking note of the failure of samples of the material to pass parameters of test IS 694:2010, IS:191:2007 & IS 440-1964. In these circumstances, defendant is not liable to pay any sum of money to plaintiff as all the material supplied by it was found in genuine, substandard and defective.
13. It is further averred that conductivity composition of metal of wires and cables, insulation etc. can only be judged by the test certificate duly issued by the OEM or certified lab and cannot be judged physically. Since the goods supplied by plaintiff failed to meet the specifications and their insulation was also found defective and inferior, defendant is not liable to pay any sum of money to plaintiff. Rather the plaintiff is liable to compensate the defendant for damages suffered by her.
14. On merits, it is denied that Sh. Shwetank Agarwal is duly authorized to sign and verify plaint or to file the suit on behalf of plaintiff. It is further denied that defendant had approached plaintiff in the month of October 2022, for purchase of various types of cables and wires. It is reiterated that it was Sh. Ravi Kant Sharma, Sales Manager of the OEM/bonoton, who had approached the defendant company at its office situated at Agra. It is stated that considering the request of Mr. Ravi Kant Sharma, defendant company had issued the POs for supply of the CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 7 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:36 +0530 materials, but plaintiff failed to supply the materials in terms of POs and supplied sub-standard materials. It is denied that plaintiff issued bills as per POs. It is claimed that entire material supplied by plaintiff was without test certificate. It is reiterated that the material supplied by plaintiff failed to pass the parameters of required test. Rest of the averments made in plaint have also been controverted on merits and it is prayed that the suit filed by plaintiff be dismissed.
15. The plaintiff filed the replication reiterating the averments made in the plaint and denying the contra averments made in the written statement. It is stated that the goods supplied by the plaintiff were strictly in accordance with specification in the purchase order. After receipt of goods, the defendant neither communicated to plaintiff that goods were not as per specifications nor returned the same to the plaintiff, but utilized/consumed the entire goods supplied by plaintiff. It was only after receipt of legal notice dated 27.03.2023, sent by plaintiff, that defendant in her reply dated 21.04.2023 concocted the story that the goods supplied by plaintiff were not as per specifications. It is denied for want of knowledge that subject to purchase of all the materials from the plaintiff, defendant had supplied the same to M/s Daksh Metal Traders, Agra, under respective GST invoices. It is also denied that the goods supplied by plaintiff could not pass the test IS 694:2010. It is further denied that samples taken out from the material, from the factory of Sh. Bahwan Das Daal Mills could not pass the test IS 694:2010, IS:191:2007 & IS 440-1964. It is stated that test certificates procured from M/s Akshat Test Lab and Calibration CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 8 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:38 +0530 Services are fabricated and must have been obtained by defendant with sole aim of avoiding payment of legitimate dues of the plaintiff. It is denied that Sh. Ravi Kant Sharma, representative of OEM M/s Bonton had approached defendant at her office at Agra, U.P. or that POs were obtained by said official of OEM to be handed over to the plaintiff. All the preliminary objections taken by defendant are stated to be false and frivolous. Rest of the averments made in preliminary submissions and reply on merits, which are contrary to averments made in plaint, have been controverted. It is again prayed that suit of plaintiff be decreed.
16. Plaintiff as well as defendant filed their respective admission/denial on affidavits.
17. From the pleadings of parties, following issues were framed:-
1) Whether the plaintiff is not entitled to suit amount as it failed to supply goods as per specifications contained in the purchase order? (OPD)
2) Whether the goods supplied by plaintiff were of defective, inferior and substandard quality due to which consumers of goods namely M/s Daksh Metal Traders, Agra, to whom goods were supplied by defendant, refused to make payment? (OPD)
3) Whether the goods supplied by plaintiff were not in accordance with IS parameters? (OPD)
4) Whether the territorial jurisdiction of the Court to entertain the suit is barred in view of preliminary CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 9 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:40 +0530 objection no.4 to the written statement? (OPD)
5) Whether the plaint has been signed and verified and suit filed through duly authorized person? (OPP)
6) Whether the plaintiff is entitled to decree for recovery of Rs.1,30,57,261/- against the defendant, as prayed for?(OPP)
7) Whether plaintiff is entitled to interest. If so, at what rate and for which period? (OPP)
8) Relief.
18. In order to prove its case, plaintiff has examined Sh.Shwetank Aggarwal, its Director, as PW1. He has reiterated the facts averred in the plaint in his affidavit Ex.PW-1/A and relied upon following documents:-
S.No. Details of documents Exhibit
1. Original Board Resolution passed by the Board Ex.PW1/1
of Directors
2. Printout of GSTIN details of the defendant firm Ex.PW1/2
3. Photocopies of three purchase orders Ex.PW1/3
(Colly)
4. Certified copy of printout of invoices Ex.PW1/4
(Colly)
5. Copy of statement of account of defendant in the Ex.PW1/5 books of plaintiff company
6. Printout of emails sent by the plaintiff to Ex.PW1/6 defendant (Colly)
7. Photocopy of legal notice dated 27.03.2023 Ex.PW1/7
8. Photocopy of postal receipt of sending legal Mark-A notice
9. Print out of email dated 27.03.2023 Ex.PW1/9
10. Photocopy of reply dated 21.04.2023 sent by Ex.PW1/10 defendant to plaintiff's legal notice
11. Affidavit U/s 65B of IE Act Ex.PW1/B CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 10 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:39 +0530
19. The PW-1 was not cross examined on behalf of defendant despite opportunity. Further, no witness was examined on behalf of defendant inspite of ample opportunities.
Matter was at the stage of final arguments when an application U/s 151 CPC was filed on behalf of defendant on 11.09.2024 seeking opportunity to cross-examine plaintiff as well as opportunity to lead defence evidence. Said application was dismissed vide detailed order passed on 11.09.2024.
The defendant challenged the order dated 11.09.2024 by filing a petition. The petition no. CM (M) 3716/2024 & CM APPL. 63126-63127/2024, filed by defendant, were dismissed by Hon'ble High Court vide judgment dated 25.10.2024.
The matter was again listed for final arguments.
20. Arguments were addressed by Sh.Amit Goel and Ms. Deepali Mittal, Counsels for the plaintiff. Written submissions were also filed by counsels for plaintiff as well as counsel for defendant. No oral arguments were addressed on behalf of defendant by her counsel Sh. Sohil Sharma. The written submissions filed on behalf of defendant also replicate the averments made in the written statement.
21. Counsel for plaintiff has argued on the lines of averments made in the plaint as well as evidence produced on record by the plaintiff.
22. I have heard the arguments addressed by counsel for plaintiff and have also perused the record as well as written CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 11 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:38 +0530 submissions filed on behalf of parties and my findings on aforesaid issues are as under:-
ISSUE NO.1 :-
Whether the plaintiff is not entitled to suit amount as it failed to supply goods as per specifications contained in the purchase order? (OPD) AND ISSUE No.2:-
Whether the goods supplied by plaintiff were of defective, inferior and substandard quality due to which consumers of goods namely M/s Daksh Metal Traders, Agra, to whom goods were supplied by defendant, refused to make payment? (OPD) AND ISSUE NO.3:-
Whether the goods supplied by plaintiff were not in accordance with IS parameters? (OPD)
23. All these issues are being taken up together as they are inter-connected. Onus of proving all these issues was on defendant. The defendant has challenged the claim of plaintiff on following grounds:-
(i) Defendant was approached by Sh. Ravi Kant Sharma, representative of the OEM M/s Bonton, at her office at Agra, U.P. Sh. Ravi Kant Sharma induced defendant by promising that in case she purchased goods in large quantity payment option would be available within two years from the delivery of the goods.
(ii) The defendant issued purchase orders giving CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 12 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:40 +0530 specification therein. Goods were supplied by plaintiff to defendant.
(iii) The material supplied by plaintiff to defendant was sold to M/s Daksh Metal Traders, Agra.
(iv) The material supplied by defendant to M/s Daksh Metal Traders was used by them in mill/factory namely Sh.
Bhagwan Dass Dal Mills.
(v) The client to whom defendant had supplied material asked for test certificate certifying the genuineness of the material so supplied as their safety consultant deputed at site, where the goods were used, had asked for it to prepare an audit report qua the electrical items used in factory so as to obtain financial assistance from the bank.
(vi) As per terms of standard business practice, applicable in the electrical industry, it is mandatory for each supplier to furnish the test certificates qua material to be supplied certifying them to the genuine so that all the financial formalities in respect of payment from user can be sorted out easily.
(vii) The plaintiff did not supply the test certificate qua the material supplied by it to the defendant and hence the end user got conducted the test itself.
(viii) Samples were taken from material used in Shri Bhagwan CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 13 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:39 +0530 Dass Dal Mills but could not pass the test IS:694:2010, IS:191:2007 & IS:440:1964 pursuant to test conducted by M/s Akshat Test Lab and Calibration Services.
(ix) Due to the fact that goods supplied to it were found defective and substandard by M/s Daksh Metal Traders, they only made payment of Rs.47,00,000/- to defendant, which was credited by defendant in the account of plaintiff, after which M/s Daksh Metal Traders refused to make rest of the payment to defendant.
(x) The conductivity composition of metal of wires and cables, insulation etc. can only be judged by test certificate issued by the OEM or certified lab and the same cannot be judged physically.
24. None of the grounds enumerated at serial no.(i) to
(x) herein-above could be proved by defendant for the defendant has neither cross-examined the PW1/Shwetank Aggarwal nor led any evidence in defence to prove the same. Even otherwise, considering the averments made in the written statement and documents annexed with it in entirety it is seen that defence taken by defendant has no legs to stand on.
25. It is not the case of the defendant that plaintiff was the only supplier of goods to it. The defendant must have been purchasing goods from the other suppliers/sellers as well. The defendant has admitted purchase order, Ex.PW1/3 (colly), however, the invoices, Ex.PW1/4 (colly), vide which plaintiff CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 14 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:38 +0530 had supplied goods to defendant have been denied. Although it is stated that defendant had given specifications of goods on purchase orders itself, no such specifications are seen mentioned thereupon. There are certain columns under the heading of "R"
"B" "Y" "BL" but the connection of said headings with specifications, if any, could not be established by the defendant. Apparently the said headings pertain to the colour of the wire only. Since plaintiff was not the only seller from whom defendant was purchasing the goods, the defendant was required to establish that the goods/material supplied to it by plaintiff vide invoices, Ex.PW1/4 (colly), were supplied by it to M/s Daksh Metal Traders vide invoices annexed as Annexure-D1 (colly) but defendant has failed to do so.
26. Further, the fact that defendant had placed order for purchase of material/goods upon plaintiff pursuant to alleged inducement by Sh. Ravi Kant Sharma that in case she (defendant) purchase goods in large quantity, payment option will be available within two years from delivery of goods is not brought out from any document namely the purchase orders, Ex.PW1/3 (colly) or invoices, Ex.PW1/4 (colly) or any other correspondence exchanged between the parties. Rather, one of the terms mentioned on purchase orders, Ex.PW1/3 (colly) is "payment - 60 days PDC". This term which is mentioned on the purchase orders, Ex.PW1/3 (colly) issued by defendant, which otherwise have been admitted by defendant in her affidavit of admission/denial of documents of plaintiff, is contrary to defendant's claim that she had option of making payment within two years from delivery of the goods or that she was to make CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 15 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:39 +0530 payment simultaneously when client made payment to her.
27. Admittedly, defendant had replied to legal notice dated 27.03.2023, Ex.PW1/7, sent by plaintiff vide reply, Ex.PW1/10, dated 21.04.2023. Nothing has been mentioned in the reply dated 21.04.2023 sent on behalf of defendant that the goods/material purchased by her from plaintiff were supplied to M/s Daksh Metal Traders, Agra or that the said client used them in Mill/factory named M/s Bhagwan Das Daal Mills. Thus, the defence taken by defendant in the written statement that goods/material purchased from plaintiff by her was supplied to M/s Daksh Metal Traders is apparently an afterthought.
28. The defendant has also taken a plea that as per standard business practice applicable to electrical industry, it is mandatory for each supplier to furnish the test certificates qua material supplied certifying them to be genuine. It is also claimed that conductivity composition of metal of wires and cables, their insulation etc. can only be judged by test certificates issued by OEM or certified lab and that the same cannot be judged physically. The defendant has failed to prove that there was any standard business practice in the electrical industry which required plaintiff to furnish test certificates qua material supplied by it to defendant to prove that the material so supplied by them was genuine. The standards which the supplied goods were to meet have also not been specified and it cannot be ascertained if the goods/material supplied by the plaintiff were indeed substandard, defective or damaged as claimed by defendant. Moreover, if there was such a standard business practice then defendant ought to have demanded that plaintiff CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 16 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:37 +0530 supplied her the requisite test certificates and to take action against the plaintiff when plaintiff failed to comply. From record, it is apparent that no such action was taken by defendant. At no point of time defendant asked plaintiff in writing to furnish test certificates. The fact that oral requests were made to plaintiff, through Sh. Ravi Kant Sharma, representative of the OEM M/s Bonton, could not be proved by the defendant. Even otherwise, no legal action was taken by defendant against the plaintiff when her repeated oral requests made through Sh. Ravi Kant Sharma did not yield results.
29. Further, perusal of record shows that plaintiff had supplied material to defendant vide invoices, Ex.PW1/4 (colly) from 19.10.2022 to 21.11.2022. From invoices placed on record by defendant, it appears that she supplied material/goods to M/s Daksh Metal Traders from 24.01.2023 till 26.02.2023. It is not clear from the documents placed on record by defendant as to when M/s Daksh Metal Traders sent goods to M/s Bhagwan Dass Dal Mills. However, at no point of time, after receipt of goods/material from plaintiff, defendant took any steps to have the quality of goods verified.
30. As per the mandate of Section 41 of the Sale of Goods Act, the defendant not having inspected the goods in question prior to delivery, has a right to inspect the same on delivery and report defects within a reasonable time of delivery. If not rejected within reasonable time, mandate of Section 42 stipulates that the defendant would be deemed to have accepted the goods. Section 41 and Section 42 of the Sale of Goods Act reads as under:-
CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 17 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:38 +0530 "41. Buyer's right of examining the goods.-
(1) Where goods are delivered to the buyer which he has not previously examined, he is not deemed to have accepted them unless and until he has had a reasonable opportunity of examining them for the purpose of ascertaining whether they are in conformity with the contract.
(2) Unless otherwise agreed, when the seller tenders delivery of goods to the buyer, he is bound, on request, to afford the buyer a reasonable opportunity of examining the goods for the purpose of ascertaining whether they are in conformity with the contract.
42. Acceptance.- The buyer is deemed to have accepted the goods when he intimates to the seller that he has accepted them, or when the goods have been delivered to him and he does any act in relation to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them."
31. It is noteworthy that at no point of time prior to receipt of legal notice from the plaintiff, defendant communicated to plaintiff that goods supplied by it were substandard and/or defective. The alleged damaged/defective goods were also not returned to plaintiff thus giving rise to presumption that all the goods supplied by plaintiff to defendant were utilized/consumed by the defendant without any complaint and the plea that said goods were defective/damaged/substandard was taken as an after thought.
32. It is noteworthy that as per averments made in para (E) of preliminary submissions to the written statement, the safety consultant deputed by the customer at site where goods were used had asked for test certificate certifying the genuineness of material so supplied to prepare the audit report qua the electrical items used in factory so that financial assistance from the bank could be obtained. Thus, the fact that test certificates CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 18 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:40 +0530 certifying genuineness of material were demanded by M/s Daksh Metal Traders, as the customer/client wanted to verify the quality of the material supplied to it by defendant is contradicted by the averments made in the written statement.
33. Further, as per record, plaintiff had issued legal notice, Ex.PW1/7, to defendant on 27.03.2023. The defendant had replied to it vide reply dated 21.04.2023 i.e. Ex.PW1/10. The test reports from Akshat Test Lab & Calibration Services, placed on record by defendant, are dated 10.05.2023, much after the demand of balance payment by the plaintiff. Moreover, none of the test reports placed on record by the defendant specifies the date when samples were collected. As per averments made in the written statement, the samples of electrical wires and cables used in factory of Sh. Bhagwan Das Daal Mills were collected for testing from the site, however, the test reports reveal the name and address of customer as that of defendant i.e. M/s A.P. Enterprises, 122, Opposite Om Bhojnalaya, Sadar Bazar, Agra, U.P.-28200. It would thus appear that defendant had sent samples from her premises for testing to the testing laboratory and the samples from the site where the material is stated to have been used were never taken. The defendant failed to prove that the samples sent by her for testing were taken from material/goods supplied by plaintiff and not the goods supplied by other suppliers. The fact that defendant got alleged samples taken and tested after receiving legal demand notice from the plaintiff gives rise to conclusion that plea taken by defendant that the material supplied by plaintiff was substandard, defective and damaged was an afterthought to evade payment of legitimate dues of the CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 19 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:39 +0530 plaintiff.
34. The defendant has also relied upon a letter dated 01.06.2023 issued by M/s Daksh Metal Traders to contend that material supplied by plaintiff to defendant, which in turn was supplied by defendant to M/s Daksh Metal Traders was substandard and defective. As was with the test reports issued by Akshat Test Lab & Calibration Services, the said communication is dated post issuance of legal demand notice by the plaintiff to the defendant for which there is no explanation forthcoming from the defendant. In these facts and circumstances and foregoing observations, the above issues are accordingly decided against the defendant and in favour of the plaintiff.
ISSUE NO.4 :-
Whether the territorial jurisdiction of the Court to entertain the suit is barred in view of preliminary objection no.4 to the written statement? (OPD)
35. Onus of proving this issue was upon defendant. The simple contention of the defendant is that since no part of cause of action arose within jurisdiction of this Court, it is not entitled to adjudicate upon the lis filed by the plaintiff.
36. It is seen that the purchase orders, Ex.PW1/3 (Colly), which have been admitted by defendant, that they all were placed by defendant at plaintiff's address of 1741, Dariba Kalan, Chandni Chowk, Delhi. The invoices, Ex.PW1/4 (colly) have specific term mentioned thereupon "Subject to 'Delhi' Jurisdiction only". Further, all the goods were supplied by plaintiff to defendant from Delhi. The part payment for goods CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 20 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:37 +0530 was made by defendant to plaintiff at Delhi. Though defendant claims that the purchase orders were obtained from her by Sh.Ravi Kant Sharma, official of OEM, from her office situated at Agra, U.P., she could not prove this fact. The defendant has thus failed to discharge the onus of proving that the Court at Delhi does not have territorial jurisdiction to entertain the suit of plaintiff. On the other hand, from the testimony of its witnesses and documents placed on record by it, plaintiff has succeeded in proving that this Court has jurisdiction to entertain the suit filed by it. This issue is also decided in favour of the plaintiff and against the defendant.
ISSUE NO.5 :-
Whether the plaint has been signed and verified and suit filed through duly authorized person? (OPP)
37. The onus of proving this issue was on plaintiff. The plaint has been signed and verified and suit instituted by Sh.Shwetank Aggarwal, who is one of the Directors of plaintiff company and has been authorized in this regard by virtue of Board Resolution, Ex.PW1/1, dated 20.03.2023, passed by directors of the plaintiff company.
38. Perusal of the plaint reveals that the same is accompanied with statement of truth and was duly verified in terms of Order VI Rule 15A CPC as all the pages of the plaint are signed by Sh.Shwetank Aggarwal, Director of Plaintiff.
39. The PW1/Sh. Shwetank Aggarwal has not been cross-examined to challenge the veracity and genuineness of Board Resolution, Ex.PW1/1 and hence the plea that the plaint CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 21 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:36 +0530 has not been signed and verified and suit has not been instituted through duly authorized person could not progress beyond a bald averment in the written statement. This issue is accordingly decided in favour of the plaintiff and against the defendant.
ISSUE NO.6 :-
Whether the plaintiff is entitled to decree for recovery of Rs.1,30,57,261/- against the defendant, as prayed for? (OPP)
40. The onus of proving this issue was on plaintiff. The averments made by the plaintiff in the plaint in support of its claim as well as evidence led by plaintiff to prove the same has been reproduced briefly in the foregoing paragraphs. Similarly, the challenge raised by the defendant to plaintiff's claim by raising defence in the written statement has also been reproduced briefly in foregoing paragraphs.
41. The plaintiff in the instant case is aggrieved by the fact that defendant failed to make outstanding payment for goods (cables and wires) supplied to him by the plaintiff vide invoices, Ex.PW1/4 (Colly). A part payments to the tune of Rs.47,00,000/- were received from the defendant from 10.01.2023 till 30.01.2023, leaving behind a balance of Rs.1,30,57,261/- which defendant failed to pay to the plaintiff despite repeated requests and issuance of legal notice dated 27.03.2023.
42. The plaintiff has examined PW1/Sh. Shwetank Aggarwal to prove its case. The testimony of PW1 has been reproduced at length in the foregoing paragraphs. The invoices alongwith proof of delivery have been proved by PW1 as Ex.PW1/4 (colly). The plaintiff has also filed its ledger account CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 22 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:40 +0530 statement Ex.PW1/5 to substantiate its claim that a balance principal amount of Rs.1,30,57,261/- remained due and payable by defendant.
43. The fact that defendant had placed order for supply of electrical goods and that the same were supplied by plaintiff to defendant has not been disputed. The only defence raised by the defendant is that goods supplied by plaintiff were defective, inferior, substandard and not as per specifications due to which consumers of goods namely M/s Daksh Metal Traders, Agra, to whom goods were supplied by defendant, refused to make payment.
44. The entire defence taken by defendant to challenge the claim of plaintiff has been thoughtfully considered while deciding issues no.1 to 3 to conclude that defendant has not been able to substantiate and/or justify non-payment of the claimed amount to the plaintiff. The plaintiff, on the other hand, from unchallenged testimony of PW1 as well as unrebutted documents placed on record and proved in accordance with law by PW1, has succeeded in proving its case.
45. Thus based on the testimony of PW1 and documents, placed on record by plaintiff, and proved in accordance with law by PW1, the only conclusion that can be drawn is that plaintiff has succeeded in proving that it is entitled to recover a sum of Rs.1,30,57,261/- from the defendant. The suit has been filed within a period of limitation as last payment of Rs.5 lakhs was made by defendant to plaintiff on 30.01.2023.
This issue is thus decided in favour of the plaintiff and against CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 23 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:39 +0530 the defendant.
ISSUE No.7:-
Whether plaintiff is entitled to interest. If so, at what rate and for which period? (OPP)
46. The plaintiff has prayed for grant of pendente lite and future interest @ 2% per month on the outstanding amount from the date of filing of the suit, which appears to be on higher side. Accordingly, plaintiff is granted simple interest @ 12% per annum on the principal amount of Rs.1,30,57,261/- from the date of filing of the suit i.e. 05.08.2023, till realization of the decretal amount, as prayed for by plaintiff.
R E L I E F:-
47. In view of foregoing observations, the suit is decreed in the sum of Rs.1,30,57,261/- (Rupees One Crore Thirty Lakhs Fifty Seven Thousand Two Hundred Sixty One only) in favour of the plaintiff and against the defendant alongwith interest @ 12% per annum thereupon from the date of filing of the suit i.e. 05.08.2023, till realization of the decreetal amount.
The defendant will further pay the full costs of the suit and additionally Rs.1,000/- spent by the plaintiff in DLSA for invoking pre-institution mediation proceedings.
Decree sheet be prepared accordingly. File be consigned to record room after due compliance. Announced in the open Court on 12th Day of December, 2024.
(ILLA RAWAT) District Judge Commercial Court-03 Central District, THC, Delhi.
CS (COMM) No. 1131/2023 Suprabhat Electric Co. Pvt. Ltd. Vs. Lakshmi Bansal Page no. 24 of 24 Digitally signed ILLA by ILLA RAWAT Date:
RAWAT 2024.12.12 16:50:38 +0530