Delhi District Court
M/S Ramo Agencies vs Hindustan Lever Limited on 3 September, 2016
IN THE COURT OF MS.NISHA SAXENA: ADJ03 (EAST)
KARKARDOOMA COURTS, DELHI.
CS No.2825/16
1. M/s Ramo Agencies
Shop No.3 & 10,
Shri Durgaji Shopping Complex
Central Market, Pocket2,
Mayur Vihar Phase1, New Delhi.
2. Mr. Gaurav Goel
S/o Shri Hem Raj Goel, Partner,
A5/6, East Krishna Nagar,
Delhi51.
3. Mr. Sunny Goel
S/o Shri M.L. Goel, Partner,
A5/6, East Krishna Nagar,
Delhi51.
4. Mr. Ajay Goel
S/o Shri M.L. Goel, Partner,
A5/6, East Krishna Nagar,
Delhi51.
.... Plaintiffs
Versus
1. Hindustan Lever Limited
Through It's Chairman,
Surya Chambers
III Floor, 124, Airport Road
CS No.2825/16 1/34
Murugenpalya, Banglore (Karnataka)
2. The Executive Director
Hindustan Lever Limited
Surya Chambers
III Floor, 124, Airport Road
Murugenpalya, Banglore (Karnataka)
3. The Regional Manager (North)
Hindustan Lever Limited
Ice Cream Division, Block No.A,
Plot No.8, South CityI, Delhi Jaipur Highway
Gurgoan 122001
4.The Area Sales Manager
Hindustan Lever Limited
Ice Cream Division, Block No.A,
Plot No.8, South CityI, Delhi Jaipur Highway
Gurgoan 122001
5. The Sales Officer
C & FA M/s Hindustan Lever Limited
B12, Lawrence Road, New Delhi110035.
..... Defendants
Date of Institution : 21.05.2007
Date of reserving judgment : 02.09.2016
Date of pronouncement : 03.09.2016
JUDGMENT:
1. The present suit has been filed by the plaintiffs for CS No.2825/16 2/34 recovery of Rs.46,05,000/ along with pendentelite and future interest @ 18% per annum against the defendants.
PLAINTIFFS CASE
2. Brief facts of the case are that the plaintiff No.1 is a registered partnership firm and plaintiff No.2 to 4 are the partners of the plaintiff No.1.
2.1 The plaintiffs were engaged in the business of distributorship agencies and trading in different items. The plaintiff no.1 was initially constituted as a partnership in the year 1992 with Sh. Om Prakash and Sh. Raman Kumar Gupta as its partners. In the year 2002, the plaintiff No.2 and 3 were inducted as partners. Subsequently, Om Prakash and Shri Raman Kumar Gupta retired from the partnership and the plaintiff No.4 was inducted as a partner of the plaintiff no.1.
2.2 The defendant No.1 is engaged in the business of manufacture of IceCreams in the name of style of 'Kwality Walls IceCream Frozen Desserts'.
2.3 The plaintiffs were the owners of a 'Cold Room' constructed in the property bearing shop No.3,10 & 11, Shri Durgaji Shopping Complex, Central Market, Mayur Vihar, Phase CS No.2825/16 3/34 I, Delhi and the MCD issued a confectionery and icecream license on 10.03.1995, to the plaintiff. The plaintiff was doing the business of distributorship of icecream for M/s Gaylord India Ltd. since the year 1992. In the year 1995, M/s Gaylord India Ltd. was taken over by M/s Brooke Bond Lipton India Ltd. which was sister concern of M/s Hindustan Lever Ltd. However, the plaintiff No.1 continued to do the business of distribution of ice cream for the products of M/s Brooke Bond Lipton India Ltd. for East Delhi Territory. With the aim of expanding their business, M/s Brooke Bond Lipton India Ltd. vide their letter dated 09.11.1995, agreed to continue the distributorship of the plaintiff subject to the completion of the following infrastructure are:
(a) Cold Rooms 3,500 c.f.t.
(b) Freezer on wheels Eight for distribution
(c) One Computer for sales information, dealer wise
secondary sales
(d) Trained field staff at least eight
2.4 At the instance of the defendants, the plaintiffs invested
heavy amounts in putting up the the infrastructure as per the requirements of the defendants and incurred expenses to the tune of Rs.26.78 lacs towards installation of cold room, deep freezers, vehicles, computer and trained staff etc. The plaintiffs obtained a cold storage license no.DLI 3653 dated 28.10.1997, for running the cold storage from Ministry of Agriculture, Department of CS No.2825/16 4/34 Rural Development, Directorate of Marketing & Inspection, under the Cold Storage Order 1980 and got installed a three phase electric connection with 21 KVA load as per the requirement of the defendants.
2.5 In the year 199798, M/s Brooke Bond Lipton India Ltd., merged into / taken over by M/s Hindustan Lever Limited, the defendant No.1. However, the plaintiffs continued to remain the sole authorized distributors for East Delhi area for Kwality Walls IceCream and frozen desserts, which became the products of M/s Hindustan Lever Limited. The plaintiff did excellent business and was awarded first prize in Stockist Excellence Award by the defendant for the year 1998.
2.6 In the year 2002, due to the retirement of the existing partners, namely Shri Om Prakash and Raman Kumar Gupta and the induction of new partners namely plaintiff No.2 to 4 herein, there was a reconstitution of the plaintiff No.1 firm. On the request of the defendants, the reconstituted plaintiff no.1 made an application to the defendants dated 18.02.2003, formally applying for being appointed as redistribution stockist for their icecream division. Vide their letter dated 18.02.2003, the defendants informed the plaintiff No.1 about their appointment as re distribution stockist (citadel) for the icecream division, initially CS No.2825/16 5/34 on adhoc basis for a period of six months on the terms and conditions as contained in the standard Redistribution Stockist Agreement. However, after expiry of the said adhoc period of six months, as per the mutual understanding, the plaintiffs continued to function as Redistribution Stockist (Citadel) in respect of the icecream frozen and desserts of the defendants.
2.7 In the year 2002, the defendant launched the VRS target scheme and the plaintiffs participated in the said scheme. Under the said scheme, the plaintiffs disbursed a sum of Rs.1.42 lacs to VRS, who had achieved target in July 2002. As per the assurance given by the defendants, the amount disbursed by the plaintiffs was to be reimbursed within 30 days of the date of disbursement of the VRS scheme. The plaintiffs lodged their claim for reimbursement as well as the refund of security deposit of Rs.20,000/ deposited by the plaintiffs many times with the defendants. However, their claim was declined without assigning any reason. The plaintiffs raised claim on the defendants time and again and the matter was also brought to the notice of the Chairman of the defendant as well as the Area Sales Manager i.e. defendant No.1 and 4, but in vain.
2.8 In May 2003, the commission @ 11% which was being given to the plaintiffs from the very beginning, was arbitrarily CS No.2825/16 6/34 reduced to 10% which was in violation of the agreed terms between the parties. This act of the defendants was without any justification or rhyme or reason and was completely unilateral without consent of the plaintiff. On the other hand, the defendants began to pressurize the plaintiffs to increase the commission of vendors.
2.9 In the month of March, 2004, the plaintiff was not supplied the icecream against the demand draft of Rs.55,000/ to meet the demand of a marriage party, without any reason. The defendants began to harass the plaintiffs in one manner or the other. There was delay by the defendants in attending the complaints and they failed to replace the goods / stocks as per the commitments. The plaintiffs were under the pressure due to their obligation to pay the installments of Rs.80,000/ per month with regard to the huge loan facilities they had availed from the Bank of India for stock /repair and renovation of the cold rooms.
2.10 On 20.04.2004, the defendants launched 'quality purchase (NSV) incentive scheme for June quarter 2004' and as per the said scheme, the defendants offered an incentive in the month of April, 2004 for sales target of 1.45 crores to the plaintiff, but for the reasons best known to them, the area of operation of the plaintiffs was reduced and the defendants started CS No.2825/16 7/34 direct supply to the retailers without routing the same through the plaintiffs, which caused heavy financial losses to the plaintiffs.
2.11 On 17.11.2004, the defendant No.4 and 5 called the plaintiffs to resolve the pending issues, however, to utter surprise and dismay to the plaintiffs, the attitude of the defendant No.4 and 5 was contrary to the terms of the standard redistribution stockist agreement. They openly threatened to ruin the business of the plaintiffs. On 20.11.2004, the defendant No.5 refused to receive the DD No.578928 drawn on Bank of India for Rs.50,000/ for supply of demanded stocks.
2.12 In the circumstances, the plaintiffs were constrained to issue a legal notice dated 11.12.2004, calling upon the defendants to pay a sum of Rs.46.05 lacs, which amount was expended by the plaintiffs in order to comply with the requirements of the defendants and which was otherwise due and payable in the course of business relationship as under:
1. Expenses incurred on account of installation of cold room and deep freezers & vehicles etc. 26.78
2. Expenses incurred on account of three phase 21 kv electric connection 5.00
3. Reimbursement claim of VRS Scheme 1.42
4. Interest of VRS claim 1.20 CS No.2825/16 8/34
5. Refund of tender amount deposited 0.20
6. Pending claim for the month of September, October & November, 2004 1.40
7. Outstanding on account of replacement claim till 31.3.2004 1.98
8. Outstanding on account of replacement claim till 31.10.2004 1.25
9. Amount due on account of difference in commission from 11% to 10% 3.93
10. Losses incurred on account of direct sale by the HLL in the area 1.08
11. Refund of original security and interest accrued thereon. 1.81 ......................
Total: Rs.46.05 Lacs
......................
2.13 The plaintiffs have, therefore, prayed for a decree for a
sum of Rs.46,05,000/ together with interest @ Rs.18% per annum from the date of filing of the present suit till its realization.
DEFENDANT'S CASE
3. The defendant has controverted the averments made in the plaint and contested the present suit. It is alleged that no cause of action arose against the defendants; that the plaintiffs CS No.2825/16 9/34 have suppressed the material facts from this court and the suit is liable to be dismissed.
3.1 On merits, it is stated that the defendant No.1 company changed its name from Hindustan Lever Ltd. to Hindustan Unilever Ltd. It is submitted that the plaintiff No.2 to 4 became the owner of the plaintiff No.1 firm in the year 2002 and prior to the year 2002, the plaintiff No.1 firm was managed and controlled by its earlier partners namely Om Prakash and Raman Kumar Gupta, who retired as a partner of the plaintiff No.1 firm and the plaintiff no.2 to 4 were inducted as partners. In the year 2003, they applied for their appointment as Redistribution Stockist of defendant No.1 company and the defendant No.1 company appointed the plaintiffs only as its adhoc Redistribution Stockist for a period of six months vide letter dated 18.02.2003 and it was further stated in the appointment letter that the terms and conditions during appointment as adhoc RS should be the same as those contained in the standard redistribution stockist agreement.
3.2 It is denied that with the aim of expanding its business M/s Brooke Bond Lipton India Ltd. vide letter dated 09.11.1995 agreed to continue the distributorship of the plaintiffs subject to the completion of the infrastructure. However, it is submitted CS No.2825/16 10/34 that no letter dated 09.11.1995 was ever written by M/s Brooke Bond Lipton India Ltd. It is denied that the plaintiffs had been making any huge investment as there were any such requirements of the defendants or that the plaintiffs incurred expenses to the tune of Rs.26.78 lacs towards installation of cold room, deep freezers, vehicle, computers and trained staff etc. It is denied that the plaintiffs got installed a three phase electric connection with 21 KVA Load as per the requirement of the defendants.
3.3 It is submitted that the plaintiffs were only appointed as an adhoc RS for a period of six months i.e. from 18.02.2003 to 17.08.2003 and the said adhoc redistribution stockist agreement got canceled after the efflux of time and the defendants had not renewed the contract / agreement with the plaintiffs keeping in view the fact that the performance of the plaintiffs was not upto the mark and the plaintiffs were not found to be interested in continuing with the distributorship of the icecream. During surprise checks by the defendants, the plaintiffs were found selling icecream of other brand which was against the terms and conditions of the adhoc redistribution stockistship.
3.4 It is admitted that M/s Brooke Bond Lipton Ltd. merged into / taken over by M/s Hindustan Lever Ltd., however, it is denied that the plaintiffs continued to remain the sole authorized CS No.2825/16 11/34 distribution for East Delhi Area. No area or any territory was distributed or marked to any of the distributor.
3.5 It is submitted that after reconstitution the plaintiffs made a written request for their appointment as the redistribution stockist of the defendants. However, after verifying the status of the firm and its new partners, the defendants appointed the plaintiffs only as its adhoc RS for a period of six months.
3.6 It is denied that the plaintiffs had participated in the VRS Scheme launched by the defendants in the year 2002 or that they were entitled for any payment in lieu of participating in that scheme or that the plaintiffs distributed a sum of Rs.1.42 lacs towards VRS. It is denied that the plaintiffs raised the claim time and again and also brought it to the notice of the defendant No.1 and 4. However, it is submitted that the defendant company had already satisfied all the legitimate claims of the plaintiffs from time to time and as on date no amount was due to be paid to the plaintiffs by the defendants except the amount of security deposit lying with the defendants.
3.7 It is denied that there was any agreed terms and conditions with respect to the percentage of commission to be given to the plaintiffs by the defendants. It is denied that in the CS No.2825/16 12/34 month of March, 2004, the plaintiffs were not supplied the ice cream against the demand draft of Rs.55,000/; that no such demand was ever raised by the plaintiffs. The plaintiffs themselves had given a no claim certificate in the month of September 2004 with respect to the transactions entered into between the plaintiffs and defendants upto August 2004, stating that no amount was due and all claim of the plaintiffs upto JC8 i.e. upto August 2004, had been settled and there was no due pending against the defendants. It is denied that the defendants had ever harassed the plaintiffs.
3.8 It is submitted that the defendant company launched various sale promotion scheme for its redistribution stockist from time to time so that they earn more commission under the scheme and for June quarter 2004, the defendants company launched quality purchase incentive scheme, but the plaintiffs were not entitled for the incentives as they failed to achieve the target scheduled as laid down by the defendant company. It is denied that on 20.11.2004, the defendant No.5 refused to receive the DD for Rs.50,000/ for the supply of stock as demanded by the plaintiffs. It is denied that the defendants indulged in any unfair trade practices or any action of the defendant company was illegal and arbitrary. No amount is due from the defendant company to the plaintiffs and no claim of plaintiffs is pending CS No.2825/16 13/34 with the defendant company except the security deposit. It is, therefore, prayed that that the suit of the plaintiffs is liable to be dismissed.
ISSUES:
4. On the pleadings of the parties, following issues were struck: (1) Whether the suit is barred by limitation? OPD. (2) Whether all the claims upto August 2004, has been settled as alleged in the written statement? OPD. (3) Whether the plaintiff is entitled to any amount from the defendants in respect of the claims made in para 19 of the plaint? OPP.
(4) Relief.
PLAINTIFF'S WITNESSES
PW1 Shri Ajay Goel
PW2 Shri K.M. Sharma, Manager, Bank of
India, Mayur Vihar Branch, Delhi.
5. PW1 Shri Ajay Goel, proved his affidavit as Ex.PW/A. DOCUMENTS RELIED UPON BY THE PLAINTIFF CS No.2825/16 14/34 Ex.P2 Office copy of the claim summary form Ex.PW1/1 True copy of certificate of registration by Registrar of Firms Ex.PW1/2 Original license issued by MCD Ex.PW1/3 Photocopy of the inspection report prepared by Delhi Electric Supply Undertaking Ex.PW1/4 True copy of the certificate issued by the defendant Ex.PW1/5 Original license under the cold storage order 1980 Ex.PW1/6 True copy of the permission dated 15.05.2000 Ex.PW1/7 True copy of the certificate issued by the defendant Ex.PW1/8 Original Form 5 in respect of change of the constitution of the plaintiff Ex.PW1/9 Original Partnership deed Ex.PW1/10 Letter dated 18.02.2003 Ex.PW1/11 Office copy of the claim summary form submitted with the defendant Ex.PW1/12 Office copy of the letter dated 20.03.2004 Ex.PW1/12(A) Original courier receipt in respect of dispatch of Ex.PW1/12 CS No.2825/16 15/34 Ex.PW1/14 Original letter dated 20.04.2004 Ex.PW1/15 Office copy of letter dated 04.05.2004 Ex.PW1/15(A) Original courier receipts to Ex.PW1/15 (D) Ex.PW1/16 Office copy of letter dated and 25.05.2004 and original Ex.PW1/16A receipts in respect thereto & Ex.PW1/16B Ex.PW1/17 True copy of letter dated 21.07.2004 Ex.PW1/18 to Photocopies of covering letters Ex.PW1/20 dated 03.11.2004, 16.11.2004 and 20.11.2004 Ex.PW1/20(A) Photocopy of bank draft Ex.PW1/21 Office copy of letter dated 21.11.2004 Ex.PW1/21(A) Postal receipt Ex.PW1/22 Office copy of the letter dated 21.11.2004 Ex.PW1/22(A) Fax Report Ex.PW1/22(B) Postal Receipt Ex.PW1/23 Office copy of legal notice dated 11.11.2004 Ex.PW1/23(A) Postal Receipts to Ex.PW1/23(E) Ex.PW1/23(F) Acknowledgment due cards to CS No.2825/16 16/34 Ex.PW1/23(I) Ex.PW1/23(J) Certificate of posting Ex.PW1/24 Office copy of Income Tax Return for the year 200405 Ex.PW1/25 & Statement of the accounts of Ex.PW1/26 the plaintiff's bank Ex.PW1/27 Certificate dated 17.06.2005 issued by the bankers of the plaintiff Ex.PW2/1 Statement of accounts (colly) pertaining to accounts No.604373400050587 in the name of M/s Ramo Agencies for the period 01.04.2004 to 15.06.2005 and 16.06.2005 to 07.03.2013 Ex.PW2/2 Statement of account pertaining (Colly) to account No. 604362600050269 in the name of M/s Ramo Agencies for the period 16.06.2005 to 07.03.2013 DEFENDANT'S WITNESSES DW1 Shri Aditya Mudgal, Regional Legal Counsel (North) at Hindustan Unilever Ltd.
6. DW1 Shri Aditya Mugal has proved his affidavit as Ex.DW1/A. CS No.2825/16 17/34 DOCUMENTS RELIED UPON BY THE DEFENDANT Ex.DW1/1 No claim certificate issued by plaintiff No.2.
Ex.DW1/2 Redistribution Stockist Agreement
7. I have given consideration to the rival contentions of Ld. Counsel for the plaintiff Mr.Amiet Andlay and Ld. Counsel for the defendant Mr. F. Hasan and gone through the entire record including written synopsis filed.
FINDINGS: ISSUE No.1: Whether the suit is barred by limitation? OPD. 8.1 The present suit has been filed by the plaintiffs for recovery. As per Limitation Act, 1963, the period of limitation for filing the recovery suits is three years.
8.2 It has been contended on behalf of the defendants that the alleged claims which relates to the expenses to the tune of Rs.26.78 lacs incurred towards the installation of cold room, deep freezers, vehicles, computers and trained staff etc. were incurred in the year 1997. The plaintiff is claiming the said amount after more than 10 years and thus, the claim is hopelessly time barred.
CS No.2825/16 18/34Claim of Rs.1.42 lacs which related to the VRS scheme for the year 2002 are also barred by limitation. The plaintiffs have made the claims which date back to the year 2002 and 2003 and the claims made by the plaintiffs are time barred.
8.3 On behalf of the plaintiffs it has been submitted that the claims made are not time barred and the plaintiffs are still continuing to make the payment of recurring liability towards the repayment of the loans along with interest to the Bank of India for installation of cold room, deep freezers, vehicles, computers etc. It is also stated that the plaintiffs claim of Rs.1.42 lacs towards VRS Scheme for the year 20022003 are not barred by limitation as the plaintiffs claim was never rejected by the defendants and are deemed to have been admitted by the defendants, who were liable to pay the same.
8.4 However, I am of the view that the limitation would start from the time when the plaintiffs spent Rs.1.42 lacs towards VRS Scheme for the year 20022003 and not from any other date. The period of limitation for three years would commence from the date when it fell due. It would not start to run on the basis that since the claim of the plaintiff was not rejected, it is deemed to have been admitted or from the fact that since the plaintiff was repaying the loan to the bank in respect of the amount borrowed CS No.2825/16 19/34 from the bank for installation of infrastructure i.e. cold room, deep freezers, vehicles, computers etc. 8.5 So far as the limitation is concerned, it would begin to run from the moment when one party has failed to perform as per the terms settled between the parties and the other party can sue. At the end of this period, the action will no longer be maintainable. A cause of action normally accrues when there is in existence a person who can sue and another who can be sued and when all facts have happened which are material to be proved to entitle the plaintiff to succeed. Accordingly, I hold that the suit is barred by limitation. Issue No.1 is decided in favour of the defendants and against the plaintiff.
ISSUE No.2: Whether all the claims upto August 2004, has been settled as alleged in the written statement? OPD.
9. The onus is upon the defendants to show that all the claims upto August 2004, has been settled as alleged in the written statement. The defendants have taken the plea that the plaintiffs themselves issued a letter addressed to the Area Sales Manager of the defendant No.1 stating therein that all the claims upto journey cycle [JC] No.8 (August 2004) have been settled and that there are no dues pending against defendants on any CS No.2825/16 20/34 account whatsoever.
10.1 In his crossexamination, PW1 Shri Ajay Goel has stated that he did not remember whether all claims of the plaintiff stood paid / settled upto August 2004. (Volunteered: He needed to check the records). He could not say as to whether an amount of Rs.1,74,482/ was paid at that time. He also denied the suggestion that all security deposits etc. stood adjusted at the time of finalizing of accounts around August 2004 and nothing remained due to the plaintiff. He denied the suggestion that all the claims of the plaintiff stood settled, fully and finally, in or around August 2004.
10.2 In his affidavit, DW1 Aditiya Mudgal, Regional Legal Manager, has stated that plaintiffs themselves gave a letter stating that all their claims upto journey cycle [JC] No.8 (August 2004) have been settled and there are no dues pending against the defendants on any account whatsoever. It is stated that as per the procedure, each distributor stockist after the completion of each journey cycle has to submit 'No Claim Certificate' for each journey cycle to the defendants. This clearly proves that no amount is payable to the distributor / stockist on account of the transaction / business done by him. 'No Claim Certificate' issued by plaintiff No.2 managing partner of the plaintiff to the CS No.2825/16 21/34 defendant is Ex.DW1/1 which is as under: "To The Area Sales Manager, Hindustan Lever Ltd., (ICD Division) Gurgoan.
Subject: Settlement of all dues.
Dear Sir, We Received credit in our account against claim No.780781 (Retail / Vending) of Rs.1,74,482/ for JC NO.8 (August 2004) with receipt of above amount. We confirm that all our claims upto JC No.8, (August 2004) has been settled and there the no dues are pending against Hindustan Lever Ltd. ICD division to us in any account what so ever.
Thanking you, You' re sincerely For RAMO AGENCIES (GAURAV GOEL) Managing Partner"
10.3 From the contents of the letter, it is clear that all the claims of the plaintiff got settled and the plaintiff has specifically stated that 'no dues are pending against Hindustan Lever Ltd., ICD division, to us in any account whatsoever.' In view of this CS No.2825/16 22/34 categorical, unequivocable and unconditional statement made by the plaintiffs it is clear that all the claims of the plaintiffs upto August 2004, had been settled by the defendants. Issue No.2 is, accordingly, decided in favour of the defendants and against the plaintiffs.
ISSUE No.3: Whether the plaintiff is entitled to any amount from the defendants in respect of the claims made in para 19 of the plaint? OPP.
10. The plaintiff has claimed a total amount of Rs.46.05 lacs in para 19 of the plaint. However, during the pendency of the petition, on behalf of the plaintiffs Mr. Ajay Goel, Partner of M/s Ramo Agencies gave his statement as under: "After due deliberation with my counsel, I am giving this statement. I am claiming only an amount of Rs.34.4 Lacs as per the details mentioned at serial No.1 to 4 on page No.9, para No.19 of my plaint along with interest @ 18% per annum. I relinquish rest of my claims."
10.1 The plaintiff is making claims only in respect of the following expenses:
1. Expenses incurred on account of installation of cold room and deep freezers & vehicles etc. 26.78 CS No.2825/16 23/34
2. Expenses incurred on account of three phase 21 kv electric connection 5.00
3. Reimbursement claim of VRS Scheme 1.42
4. Interest of VRS claim 1.20 10.2 The plaintiff was doing the business of distributorship of icecreams with M/s Gaylord India Ltd. since the year 1992. In the year 1995, M/s Gaylord India Ltd. was taken over by M/s Brooke Bond Lipton Ltd. which was sister concern of M/s Hindustan Lever Ltd. It means that plaintiff had the necessary infrastructure i.e. cold room, deep freezers, vehicles, computers etc. since the year 1995 only. The plaintiff has not given details as to how much it incurred on each of the articles. There are no loan documents, no invoices / expense vouchers on record to prove the amount that it spent on having the necessary infrastructure for the business of distributorship of icecreams.
10.3 PW1 has stated that M/s Brooke Bond Lipton India Ltd.vide their letter 09.11.1995 agreed to continue the distributorship of the plaintiff subject to completion of the following infrastructure i.e.
(a) Cold Rooms 3,500 c.f.t.
CS No.2825/16 24/34
(b) Freezer on wheels Eight for distribution
(ci) One Computer for sales information, dealer wise
secondary sales
(di) Trained field staff at least eight
10.4 However, this was the requirement for continuing as a
distributor of the icecreams for M/s Brooke Bond Lipton India Ltd. This was a prerequisite for a stockist of icecream and by no stretch of imagination expenses made on having such infrastructure could be claimed from the defendants as the plaintiff continued as a distributor / stockist for M/s Brooke Bond Lipton India Ltd. for a fairly long period. The amount invested by the plaintiff in having the infrastructure for continuing as a distributor for the defendant cannot be claimed from the defendant as there were no such terms and conditions agreed to between the parties. The letter dated 09.11.1995, on the basis of which the plaintiff is claiming that M/s Brooke Bond Lipton India Ltd. agreed to continue the distributorship of the plaintiff subject to completion of the infrastructure has not been placed on record. DW1 Shri Aditiya Mudgal has categorically denied the existence of letter dated 09.11.1995. The plaintiff has basically placed reliance upon Ex.D3 which is an RS appointment form which is a document of the defendant in which they have assessed the infrastructure and stock of the plaintiff as follows: CS No.2825/16 25/34 Cold Room (2) 36 lac Vehicle (FOW) (8 Nos). 15 lac Immovable property 36 lac Stock 9 lac Office equipment 5 lac 101 lac 10.5 However, the document in question is only an RS appointment form in which the value of the property and stock has been assessed by the defendant. However, there is no basis on which such assessment has been made and it cannot be said to be an appropriate assessment made by the defendant. The plaintiff has not placed on record any document in respect of the expenses incurred by the plaintiff in installation of cold room, deep freezers, vehicles, computers etc. There are no invoices placed on record to prove the exact amount incurred nor any witness has been examined to this effect.
10.6 PW2 Shri K.M. Sharma, Manager, Bank of India, Mayur Vihar Branch, Delhi has proved the statements of accounts pertaining to the bank accounts No.604373400050587 and 604362600050269 in the name of M/s Ramo Agencies for the period 01.04.2004 to 15.06.2005 and 16.06.2005 to 07.03.2013 as Ex.PW2/1 (Colly) and Ex.PW2/2 (Colly). However, it is stated CS No.2825/16 26/34 by Ld. Counsel for the plaintiff that the statement of account proved by this witness is regarding the payment of installments and there is nothing on record to show that the plaintiff incurred expenses of Rs.26.78 lacs for installation of cold room, deep freezers and vehicles etc. 10.7 The plaintiff has not placed requisite documents on record to show that it incurred expenses to the tune of Rs.26.78 lacs towards installation of cold room, deep freezers, vehicles, computers and trained staff etc. Even assuming that such expenses were made by the plaintiff, the expenses were made in the normal business routine and the plaintiff successfully used such infrastructure to carry out business activities and earn profits for about 10 years. The plaintiffs have not attached any document in support of the claim that such expenses were made at the behest of the defendants with a promise to reimburse the same to the plaintiff as and when desired by the plaintiff and it was for the plaintiff to make his own arrangement for storing and marketing the product of the defendant and the defendant was not in any way concerned with the expenses of such nature.
10.8 In his crossexamination, PW1 Shri Ajay Goel admitted that after reconstitution of the plaintiff firm no agreement was signed between the plaintiff and the defendant CS No.2825/16 27/34 No.1 and the appointment of plaintiff as Redistribution Stockist on adhoc basis was for a period of six months. He admitted that after expiry of six months period, some time in early 2003 the materials were purchased against demand drafts in favour of the defendant No.1. Volunteered: Even prior thereto, the material had been purchased on similar basis. The plaintiff also stated that he had not placed any document in respect of his appointment as a stockist for walled city and East Delhi area together with Appu Ghar and Zoo. Volunteered: No other stockist was appointed in respect of these areas.
10.9 Ex. PW1/10 dated 18.02.2003, issued by the defendant to Ramo Agencies is a document which show that after reconstitution of the firm the plaintiff was appointed as adhoc Redistribution Stockist, for a period of six months from 18.02.2003 and unless adhoc appointment was made regular and terms and conditions were made into writing, the appointment of the plaintiff as an RS was to come to an end automatically on the expiry of six months i.e. 17.08.2003. The relevant portion of Ex.PW1/10 is as under: "We have gone through your application dated 18.02.2003 requesting us for appointing you as our Redistribution Stockist (Citadel) for Ice Cream Division. In this connection we wish to inform you that while your application is being processed, we are happy to appoint you as an adhoc Redistribution CS No.2825/16 28/34 Stockist for a period of six (6) months from the date of this letter. We wish to state that as agreed the terms and conditions during your appointment as ad hoc RS shall be the same as those contained in the standard RS agreement, copy of which is enclosed for your reference.
We further wish to state that unless the adhoc appointment is made regular by way of formally entering into a Redistribution Stockist Agreement (Citadel) and reducing the agreed terms and conditions into writing your appointment as an RS will come to an end automatically on the expiry of six months i.e. 17.08.2003."
10.10 PW1 denied the suggestion that the agreement of adhoc appointment was not extended after the expiry of six months for the reasons that there had been no improvement in sales and the plaintiff was found to be also dealing in the products of the competitors.
10.11 PW1 has stated in his crossexamination that the cold rooms, deep freezers and vehicles for supply were purchased around the year 199596 as was told to them by previous partners. He admitted that invoices in relation to above machineries / vehicles were not placed on record. They had already disposed of the said machinery / vehicles. The plaintiff has not disclosed as to for what amount the machinery and vehicles were disposed of. He denied the suggestion that even a redistribution stockist dealing in icecream / frozen products CS No.2825/16 29/34 ought to have cold room, deep freezer and vehicles suitable for supply. He volunteered that the vehicles and deep freezers are must. The cold rooms, deep freezers and vehicles etc. were disposed of around two / three years back. He could not say whether no letter dated 09.11.1995 was written by Brooke Bond Ltd. to the plaintiff, insisting for purchase of cold room etc. before appointment as RS. He has denied the suggestion that no such letter dated 09.11.1995 exists and it is for this reason that the same has not been placed on record. He admitted that in usual course of such a business, a stockist would require deep freezers and vehicles for supply but the same was not correct in respect of the cold room machinery. He denied the suggestion that since M/s Brooke Bond had never insisted for any such purchase, it was for this reason that he had not been able to place any document / proof thereof. He admitted that the cold room, deep freezers and vehicles were used by the plaintiff from the year 1995 till the disposal (volunteered till the operations were carried on).
10.12 From the evidence brought on record, it is clear that the defendant does not owe anything to the plaintiff in respect of cold room machinery, deep freezers, vehicles and computers etc. as neither invoices have been placed on record nor it is proved that it were purchased at the instructions of the defendants or that the defendant agreed to reimburse the plaintiff CS No.2825/16 30/34 in respect of the infrastructure it was required to have as an Redistribution Stockist and the defendants had used the said infrastructure for a number of years till the operations were carried on and thereafter disposed of the same on its own.
10.13 The plaintiff has also claimed Rs.5 lac in respect of the expenses incurred on account of three phase 21 K.V. Electric connection. The plaintiff has placed reliance upon Ex.PW1/3 with regard to the electricity connection, however, the document is a record of inspection and does not show that Rs.5 lacs were sent by the plaintiff on account of three phase 21 KV electric connection. In the crossexamination,PW1 admitted that the electric connection of 21 K.V. was obtained by them for their business purposes and not on the asking of the defendant. From the testimony of PW1 it is clear that the electric connection was obtained by the plaintiff on their own for the business and the defendant cannot be expected to pay for the installation of the electricity connection which was required by the plaintiff to run its business and earn profits.
10.14 The plaintiff has also sought reimbursement claim of VRS Scheme to the tune of Rs.1.42 lacs. PW1 Shri Ajay Goel, partner of the plaintiff has denied the suggestion that the plaintiff never paid Rs.1.42 lacs to vending stockist as claimed.
CS No.2825/16 31/34He denied the suggestion that all claims of the plaintiff stood settled, whether in VRS or replacement or otherwise.
10.15 It has been contended by Ld. Counsel for the defendants that all the claims of the plaintiff stood paid / settled upto August 2004. PW1 could not say as to whether an amount of Rs.1,74,482/ paid at that time. He denied the suggestion that all the claims of the plaintiff stood settled, fully and finally in or around August 2004. In his crossexamination, DW1 Aditiya Mudgal has stated that as per record of the company, the plaintiff's records were not present in the list of participants in the VRS Scheme. He also admitted that he had not filed list of participants in the VRS Scheme. He admitted that VRS Scheme was not mentioned in the 'No Claim Certificate'. In respect of the claim for VRS, the plaintiff have relied upon Ex.PW1/12 dated 20.03.2004, Ex.PW1/15 dated 04.05.2004 and Ex.PW1/16 dated 25.04.2004. The contents of these three letters are same except for the fact that they are addressed to different authorities i.e. ASM, Vice President and Executive Director respectively. The relevant contents of Ex.PW1/15 are as under: "At the instance of Shri Vijay Kaul Sales Officer and Manoj CSC we had disbursed R.1,42,300/ towards VRS Schemes launched by the company with the understanding that the amount would be adjusted and reimbursed to us CS No.2825/16 32/34 within 30 days from the date of disbursement of the VRS Schemes. Accordingly when the claim was submitted to the company duly recommended by competent authorities. It was turn down. This unilateral and arbitrary decision is taken by surprise and came to us as a rude shock. Since then we have requested the Area Sales Manager Ice Cream Division, HLL Gurgaon for settlement of long outstanding dues (vide our letter dt. 20.03.2004 copy enclosed) but there has been no response at all."
10.16 DW1 Aditiya Mudgal has denied that plaintiffs participated in the VRS Scheme launched by defendants in the year 2002 or are entitled for any payment in lieu of participating in the scheme. He has further denied that the plaintiffs distributed a sum of Rs.1.42 lacs towards VRS (Vending Redistribution Stockist).
10.17 The plaintiff has miserably failed to produce cogent evidence to reflect that when and to whom the plaintiffs disbursed an amount of Rs.1,42,300/. There is nothing on record to suggest that there was any understanding between the plaintiffs and the defendants that the plaintiffs would be reimbursed the amount, if any, disbursed by the plaintiffs on VRS Scheme. In absence of any tangible, substantial and perceptible evidence, I am of the considered opinion that the plaintiffs have failed to prove that the plaintiffs are entitled for any reimbursement in CS No.2825/16 33/34 respect of VRS Scheme. Therefore, interest on VRS claim is totally out of question.
10.18 Accordingly, I hold that the plaintiffs are not entitled for any amount from the defendants in respect of the claims made in serial No.1 to 4 of para No.19 of the plaint. Issue No.3 is, accordingly, decided in favour of the defendants and against the plaintiffs.
ISSUE NO.4 RELIEF:
11. In view of the foregoing discussion, the suit of the plaintiffs stands dismissed with no order as to cost. Decree sheet be prepared accordingly. File be consigned to record room.
Announced in open court (NISHA SAXENA)
Dated:03.09.2016 ADDL. DISTRICT JUDGE03(E):
KARKARDOOMA COURTS:
DELHI
CS No.2825/16 34/34