Delhi District Court
Food Corporation Of India vs Smt. Urmila Bai on 29 September, 2018
Food Corporation of India V. Urmila Bai & Ors.
IN THE COURT OF SH. ARUN SUKHIJA,
ADDITIONAL DISTRICT JUDGE - 07, (CENTRAL DISTRICT)
TIS HAZARI COURTS, DELHI.
SUIT NO.: 02/2017
UNIQUE CASE ID NO.: 35/2017
Food Corporation of India
Regional Office
17, Prabhat Kiran Building,
Rajendra Place,
New Delhi. ...Plaintiff
Versus
1. Smt. Urmila Bai
W/o Late Gauri Shankar
R/o H. No. 82682/1, Banjara Hills,
Hyderabad.
2. Sh. Parveen Kumar
S/o Late Gauri Shankar
R/o H. No. 82682/1, Banjara Hills,
Hyderabad.
3. Sh. Anand Kumar
S/o Late Gauri Shankar
R/o H. No. 82682/1, Banjara Hills,
Hyderabad.
Suit No. 02/2017 Page 1 of 63
Food Corporation of India V. Urmila Bai & Ors.
4. Smt. Vandana Tiberwala
D/o Late Gauri Shankar
R/o H. No. 82682/1, Banjara Hills,
Hyderabad.
5. Smt. Sheetal Gupta
D/o Late Gauri Shankar
R/o H. No. 82682/1, Banjara Hills,
Hyderabad. ...Defendants
SUIT FOR RECOVERY OF RS.71,65,617.23P
DATE OF INSTITUTION : 19.01.1998
DATE OF ARGUMENTS : 04.08.2018
DATE OF JUDGMENT : 29.09.2018
JUDGMENT
By way of present judgment, this court shall adjudicate suit for recovery of Rs.71,65,617.23p filed by the plaintiff against the defendants.
CASE OF THE PLAINTIFF AS PER PLAINT Succinctly the necessary facts for just adjudication of the present suit, as stated in the plaint, are as under:
(a) The plaintiff is the Food Corporation of India, a body corpo rate, established under the Food Corporation Act, 37/1964 for the purpose of trading in food grains and other food stuffs Suit No. 02/2017 Page 2 of 63 Food Corporation of India V. Urmila Bai & Ors.
and for matters connected therewith and incidental thereto and represented by the Senior Regional Manager, who is competent to verify pleadings and sign plaints etc. on behalf of the plaintiff.
(b) The defendant is Tirupati Khandsari Sugar Factory, a propri etory concern having licence to manufacture Khandsari Sugar and having its correspondence office at 101, Business Towers, Tilak Road, Hyderabad - 500001, Andhra Pradesh and factory at Village Singapur, Mandal Shankarpalli, Distt. Ranga Reddy, Andhra Pradesh. The said concern is owned and represented by its sole proprietor, Sh. Gouri Shankar and authorised signatory of and deponent in affidavits filed in support of the Writ Petitions on behalf of the defendant in Hon'ble High Court of Andhra Pradesh, Hyderabad from time to time. Sh. L.P. Gupta, S/o Mohanlalji, aged 59 years and authorized representative to lift sugar from Narela and Maya puri godowns, Sh. Rajiv Kumar, C/o the sole proprietor, 101, Business Towers, Tilak Road, Hyderabad, A.P. 500 001.
(c) The plaintiff invited sealed tenders from licenced/ registered dealers manufacturing toffees/ lozenges, sugar candy, khandsari, confectioneries, boora, kulia, patase and misri for sale of about 1155 MTs wet/discoloured/ sweated sugar and 11 MTs of sugar sweeping on "as is, where is basis" and as per the terms and conditions embodied in tender form (which could be had from the plaintiff on the payment of Rs.100/ in Suit No. 02/2017 Page 3 of 63 Food Corporation of India V. Urmila Bai & Ors.
cash (nonrefundable) from 25.5.1994 and 03.6.1994 upto 1.00 P.M.) a notice inviting tender was published on 22.5.94 and 23.5.94 and was given wide publicity, interalia, specify ing that the tender must be accompanied by earnest money indicated in the tender terms, that the tenders would be re ceived upto 2.00 PM on 03.6.1994 and opened on the same day at 2.30 P.M. in the presence of the tenderers or their au thorized representatives, as the case may be who might wish to be present. In the tender form, it was stipulated that 02.7.1994 was the date fixed keeping the offers open for ac ceptance by the Competent Authority. The plaintiff craves leave of this Court to refer to and rely on the notice inviting tender and the terms of the tender.
(d) The defendant was one of the successful tenderers in respect of two lots. Its proprietor authorized Sh. L.P. Gupta to ap pear on his behalf and also signed the necessary documents. The latter's specimen signature was attested by him and an authorization containing the same was also submitted to the plaintiff.
(e) The tender enquiry was held by the Committee of Officers authorized for receiving and opening the tenders and on re view of the rates quoted by the tenderers, it was felt that the same were not upto the mark when compared with the pre vailing market prices of sound sugar and that there was pos sibility of improvement if the tenderers were called for negoti Suit No. 02/2017 Page 4 of 63 Food Corporation of India V. Urmila Bai & Ors.
ations and thereupon, it was decided to have such negotia tions on 01.7.1994.
(f) Eighteen valid tenderers attended the meeting and partici pated in the negotiations and they offered revised rates for such of those lots for which they had earlier given rates and deposited the required earnest money. The defendant, who had earlier quoted rates for two lots only viz., lots 13 and 14 and had deposited the proportionate EMD for those two lots, had at the meeting quoted uniform rate of Rs.1189.09 (Ru pees One Thousand One Hundred Eight Nine and Nine Paise Only) for all the lots, except lots at serial nos. 13 and 14 (wet and sweated sugar) and Rs.900.09 (Rupees Nine Hundred and Nine Paise only) for all the lots of sugar sweepings at se rial nos. 53 to 60. The defendant deposited demand draft dated 13.07.1994 of State Bank of Hyderabad for Rs.6,62,384.34p to make good the shortfall in the earnest money deposit required to be made. In spite of the equal op portunity having been given to all the intending tenderers to revise their rates, the others amongst the 18 tenderers who attended have not offered higher rates than the defendant. As such, the defendant's rates were accepted by the Compe tent Authority.
(g) The plaintiff issued telegram to the defendant on 18/07/1994 conveying approval of 53 lots and calling upon the defendant to deposit full cost with Octroi Charges before Suit No. 02/2017 Page 5 of 63 Food Corporation of India V. Urmila Bai & Ors.
25.7.94 and also sent a post copy in confirmation by speed post on 19.7.1994.
(h) By PCC letter (By Speed Post) dated 19.7.94, the defendant was directed to deposit total cost of Rs.1,20,39,355.11 for sugar lots and octroi charges @ Rs.11/ per quintal by 25.7.1994, liable to pay the full cost less amount of (earnest money deposit) EMD within seven working days from the date of issue of acceptance letter by the plaintiff. The defen dant requested for permission to pay the same in four in stallments and within 15 days. As per the standing instruc tions of the plaintiff's head office, the Competent Authority can allow payment of the cost of 3 installments only subject to payment of interest at the prevailing rate and also storage charges, if the cost of the allotted stocks exceeds Rs.15,00,000/. Further, the cost of the first installments of the stocks is payable within 7 working days, as provided in the tender terms. The total cost of the 53 lots being Rs.1,20,39,335.11, 1/3rd thereof is Rs.40,13,112/ and therefore, the defendant was required to deposit the said 1/3rd amount without delay.
(i) The defendant defaulted in depositing the said amount in time and instead sent a telegram dated 3.8.94 stating that payment of the first installment was being arranged. The de fendant by representation dated 22.7.1994 requested to per mit lifting of stocks in four lots and extension of time by 15 Suit No. 02/2017 Page 6 of 63 Food Corporation of India V. Urmila Bai & Ors.
days for lifting of the first installment/ lot. As the defendant did not adhere to the time schedule in spite of repeated re minders issued from time to time and ample opportunity having been given, it was decided by 3.9.1994 that if the de fendant failed to deposit the first installment with interest and storage charges as per tender terms by 6.9.1994, the earnest money deposit would be forfeited without further no tice and retender the stocks at the risk and cost of the de faulting tenderer should be resorted to in view of the nature of commodity that was agreed to be purchased by the former. The sugar stocks are hydroscopic in nature and prolonged retention thereof in the godowns (of the Food Corporation) would result in deterioration of the quality of the sugar which was offered for sale as wet and sweated sugar and sugar sweepings. Further, such deterioration of the quality was in all probability likely to cause cross infestation to the food grains stored in the same units where such sugar stocks are lying and in the event of such infestation taking place, there would be immense loss to the Corporation as the food grains might become unfit for human consumption and for marketing through public distribution system. Having re alized that default had been committed, thereupon, along with letter dated 8.9.1994, the defendant deposited three bank drafts each for Rs.4,00,000/. The defendant also de posited another DD for Rs.28,00,000/ on 17.9.1994 making Suit No. 02/2017 Page 7 of 63 Food Corporation of India V. Urmila Bai & Ors.
the total amount of deposit Rs.40,00,000/. The delay in making the deposit was sought to be explained.
(j) By another letter dated 17.9.1994, the defendant undertook to deposit the second installment amount by 5.10.1994. Vide letter dated 19.9.1994, the defendant authorized one Shri Rajiv Kumar to lift the sugar, from Narela/ Mayapuri godowns of FCI, Delhi. The plaintiff informed by telegram dated 10.10.1994 that the extension applied for by the defen dant through telegram dated 5.10.1994 could not be granted and the defendant was called upon to deposit the cost of the second installment with interest and storage charges imme diately thereafter on pain of facing action as per tender terms. In the post copy, the contents of the telegram were elaborated. Another telegram dated 18.10.1994 was sent by the plaintiff, which was responded to the defendant's tele gram dated 18.10.1994 stating that payment was being ar ranged but the same was not arranged. Instead, the defen dant addressed letter dated 27.10.1994 promising to pay the second installment by 31.10.1994 positively and also ex pressing readiness to pay the amount as per the tender terms and also threatening that, "still if an unnecessary ac tion is taken, you will be responsible for all losses and conse quences". On 02.11.1994, another letter addressed by the defendant was received through which the defendant sought for permission to pay the balance in four installments of Suit No. 02/2017 Page 8 of 63 Food Corporation of India V. Urmila Bai & Ors.
Rs.20,00,000/ each not later than 30.11.1994 and autho rising the plaintiff to charge "the godown and interest charges as per terms discussed" with liberty to take action, in the event of failure to make such deposit. The plaintiff did not accord any such permission. On the other hand, by let ter dated 17.11.1994, the plaintiff called upon the defendant to deposit the balance amount with due interest and storage charges as assured in the defendant's letter dated 02.11.1994.
(k) In view of the defendant's failure to deposit the amounts, as promised and assured earlier, on 6.12.1994, the plaintiff is sued telegram stating that EMD/ security deposit stood for feited and the stocks were being rendered at the defendant's risk and cost. It was followed up by a post copy in confirma tion. The defendant finally resorted to futile litigation by fil ing/ getting filed a series of writ petitions in the Hon'ble High Court of Andhra Pradesh, details of which are as follows:
1) The first amongst them is W.P. No. 22801/94. The defen dant's prayer in the said writ petition is reproduced here under: "In the circumstances, it is therefore, prayed that this Hon'ble Court may be pleased to issue an ap propriate writ, more in the nature of mandamus declaring the proceedings No.QC 9(6)/RO/ND/94/Wet & Sweated Sugar of Senior Regional Manager, Food Corporation of India, Re gional Office, New Delhi dated 6.12.1994 of the 1st Suit No. 02/2017 Page 9 of 63 Food Corporation of India V. Urmila Bai & Ors.
respondent as arbitrary, illegal, unconstitutional and violative of principles of natural justice, and issue a consequential direction restraining the re spondents from enforcing the order dated 6.12.1994 and grant such other writ or order as the Hon'ble Court deems fit and proper in the cir cumstances of the case."
2) The defendant also filed stay petition, W.P.M.P. No.28415/94 in the said Writ petition seeking for follow ing relief(s) which is reproduced hereunder: "In the circumstances, it is therefore, prayed that this Hon'ble court may be pleased to stay all fur ther proceedings in pursuance of the order dated 06.12.1996 No.QC9(6)/RO/ND/94/Wet and Sweated Sugar of Senior Regional Manager, Food Corporation of India, Regional Office, New Delhi, pending disposal of the Writ Petition".
3) By order dated 30.12.1994 in WPMP No.28415/94, the Hon'ble High Court ordered: "that on condition of the payment of the balance amount mentioned in the impugned notice before 28.2.1995,all further proceedings in pursuance of the order dated 6.12.1994 in proceedings No.QC 9(6)/RO/ND/94/Wet & Sweated Sugar of Senior Regional Manager, Food Corporation of India, Re gional Office, New Delhi be and hereby are stayed, pending further orders on this petition".
(l) In obedience to the aforementioned stay order, the plaintiff did not proceed further with the retendering exercise. How ever, the defendant did not deposit the amount, as ordered by the Hon'ble High Court of A.P. within the time given i.e. by Suit No. 02/2017 Page 10 of 63 Food Corporation of India V. Urmila Bai & Ors.
28.2.1995 but once again approached the Hon'ble High Court seeking grant of further time and four months from 28.2.1995 and also to deposit the amount of Rs.80,00,000/ in 16 weekly installments of Rs.5,00,000/The plaintiff op posed the said request which lacked bonafides and on hear ing both the parties, the Hon'ble High Court dismissed the said stay petition by order dated 1.3.1995.
(m) On the legal advice, the plaintiff proceeded further with the exercise of retendering of the stocks as per the original terms and conditions of the tender submitted by the defen dant in the first instance i.e. at the risk and cost of the de fendant. A fresh notice inviting tenders was published in some of the leading newspapers on 21.3.1995 proposing to hold tender enquiry at the risk and cost of the defendant, on 01.4.1995 at 2.30 P.M. in the plaintiff's office.
(n) The defendant once again approached the Hon'ble High Court of Andhra Pradesh by filing W.P. No. 6104/95. The prayer in the said writ petition is reproduced hereinbelow: "It is therefore, prayed that this Hon'ble Court may be pleased to issue an appropriate writ, order or direction particularly one in the nature of Writ and Mandamus declaring that the action of the respon dent in calling for tenders under Notification dated 21.3.1995 for the sale of about 721 MT wet dis coloured/ sweated sugar and 11 MT sweeping sugar is arbitrary and illegal violating Articles 14, 19(1)(g) and 21 of the Constitution of India apart from being violative of the fundamental principles Suit No. 02/2017 Page 11 of 63 Food Corporation of India V. Urmila Bai & Ors.
of natural justice and to pass such other order or orders as this Hon'ble Court may deem fit and proper".
(o) The defendant (writ petitioner) also sought for an interim or der of stay of all further proceedings in furtherance of the no tification dated 21.3.1995 issued by the plaintiff herein (wrongly mentioned as respondents, as well as the Senior Re gional Manager, Regional Office, Hyderabad, calling for the tenders for the same about 721 MTs wet discoloured/ sweated sugar and 11 MTs of sugar sweepings, pending dis posal of the Writ Petition. The Hon'ble High Court was not pleased to issue any interim order staying the further pro ceedings in furtherance of the plaintiff's notification dated 21.3.1995 inviting fresh tender in respect of the unlifted wet/ sweated sugar and sugar sweepings mentioned in the writ petition. The writ petition was opposed by the plaintiff herein. The said writ petition was dismissed and the writ ap peal No. 227/95 filed against the said dismissal order also was withdrawn by the defendant herein and accordingly dis missed by Hon'ble High Court on 03.4.1995.
(p) Thereupon, the defendant dragged the plaintiff into further frivolous, vexatious, speculative and futile litigation by filing WP No. 6104/95 and also getting filed WP No. 7977/95 through his associate. In para 3 of the affidavit filed in sup port of the latter writ petition (W.P. No. 7977/95), the depo nent D.K. Agarwal averred that he, S/Shri S.N. Gupta, In Suit No. 02/2017 Page 12 of 63 Food Corporation of India V. Urmila Bai & Ors.
drakumar Gupta and Raj Kumar were "partners in getting up the 3rd respondent herein for filing tenders and obtaining necessary orders". The 3rd respondent therein is the defen dant herein. No where did the defendant ever allege that the defendant was owned by a partnership firm. The defendant herein had all along been described as a sole proprietory concern owned by Gouri Shanker. W.P. No. 7977/95 was filed by the petitioner therein, purporting to have been ag grieved by the action of the plaintiff herein in issuing the ten der notification dated 21.3.1995. The plaintiff herein op posed the said writ petition also.
(q) The filing of a spate of Writ Petitions individually or through associate demonstrates the defendant's malafide intention to evade and avoid the consequences following its deliberate de fault in making the requisite payments and dilatory tactics to prevent the retendering and sale of the unlifted stocks of wet sweated sugar and sugar sweepings, which the plaintiff is entitled to make under conditions No. D (iii) of the original tender submitted by the defendant on 3.6.1994. While reject ing the request to stay the tender enquiry in pursuance of tender notification dated 21.3.1995, a learned Single Judge of the Hon'ble High Court of Andhra Pradesh also gave lib erty the defendant to submit its tender and participate in the proceeding subject to compliance with the formalities. How ever, the learned Judge rejected the Writ petitioner's request Suit No. 02/2017 Page 13 of 63 Food Corporation of India V. Urmila Bai & Ors.
that the security deposit already furnished may be adjusted for submitting fresh tender. But the defendant did not avail the said opportunity. The plaintiff submits that whatever ac tion was taken such as calling for fresh tenders by issuing notification dated 21.3.1995, the same was taken only to protect the interests of the Corporation, such action having been warranted by the unjust and unjustifiable, deliberate default committed by the defendant in making the payments and resorting to dilatory tactics by filing W.P. No. 22801/94 in the first instance when proceedings dated 6.12.1994 was issued as a last resort and under inevitable circumstances. It is the defendant who committed breach of contract and thus, precipitated the termination of the contract following acceptance of the tender submitted on 3.6.1994.
(r) Para (iii) of condition no. D of the terms and conditions for the sale of the sugar, sweepings/ wet and sweated stocks ly ing at FSD Naraina/New Pusa/Shaktinagar/Ghevra/Narela/ Okhla/Cwc RP Bagh through tender No. QC9(6)/RO/ND/ Sugar Sweepings vide scheduleII is reproduced hereinbelow: "In the event of failure to complete the payment within the specified time, the sale relating to such lot or lots, shall be cancelled and the earnest money in full, shall be forfeited and Food Corporation of In dia shall be entitled to resell the goods or part thereof to another party at the risk and cost of the original buyer and also to recover any loss suffered Suit No. 02/2017 Page 14 of 63 Food Corporation of India V. Urmila Bai & Ors.
by it as a result of such failure. Any gain on any re sale, as aforesaid, shall accrue to the Food Corpo ration of India and the buyer shall not have any claim over it."
(s) The said risk and cost clause is one of the agreed terms and conditions of the tender and the defendant having consented to the said terms and conditions, the same are binding on the defendant. The period of disposal of perishable com modities like food grains and sugar are fixed after thorough quality inspections and checks and the time schedule for dis posal of the unlifted perishable commodities was meticu lously planned as to avoid further deterioration in their qual ity and to minimise monetary loss to the plaintiff Corporation and in the larger interest of the public exchequer, in as much as, the plaintiff Corporation operates on the subsidies pro vided by the Government of India. As such, time was essence of the suit contract concluded with the defendant. In view of the noncompliance by the defendant with the Court's order i.e. failure to deposit the balance amount by 28.02.1995 a tender enquiry was held on 1.4.1995 in respect of 38 lots of wet/sweated sugar, sugar sweepings which remained un lifted by the defendant at the defendant's risk and cost and the entire stocks were allotted to the successful parties at the tender at the rates offered by the parties and approved by the competent authority. As a consequence thereof as on 2.5.1995 a sum of Rs.46,98,343.36 became due comprising Suit No. 02/2017 Page 15 of 63 Food Corporation of India V. Urmila Bai & Ors.
of:
a) Rs.30,95,735.83 towards differential cost of bal ance 38 lots;
b) Rs.14,57,321.37 being interested on belated pay ment @ 21.25% from 19.7.1994 to 2.5.95 and sub sequently upto 20.10.97 i.e. Rs.24,67,273.87;
c) Rs.1,58,980.60 towards storage charges @ 0.10 Ps per bag for period from 1.10.94 to 2.5.1995 Less: Rs.13,694.44 due to the defendant, in view of the earlier payments made i.e. a total of Rs.71,65,617.23 became due from the defendant and to recover the same, the plaintiff addressed registered letter No.QC9(6)/RO/ND/Sugar Wet and Sweated sugar/360 dated 8.1.1996 calling upon the defendant to deposit the same on or be fore 31.1.1996, but the defendant evaded receipt of the said letter. The defendant is deemed to have been served with the said letter.
(t) The plaintiff is entitled to recovery of the abovementioned amount with interest on items (a) and (c) above at the market rate i.e. 21.25% p.a. from 3.5.1995 till 20.10.1997 and till the date of suit and from the date of suit till realization at the same rate as the suit liability arose on account of breach committed by the defendant in respect of a commercial Suit No. 02/2017 Page 16 of 63 Food Corporation of India V. Urmila Bai & Ors.
transaction and costs. Hence, the present suit.
CASE OF THE DEFENDANTS AS PER WRITTEN STATEMENT Summons was issued to the Original Defendant Shri Gauri Shankar. The original defendant filed the written statement in the present case. Succinctly, the case of the defendants is as un der:
(i) The defendant does not have any office of any kind at the alleged address of 101 Business Towers, Tilak Road, Hy derabad500001 and the defendant never submitted any ten der for purchase of sugar from the plaintiff at any point of time. The defendant never authorized anyone for submitting any tender on his behalf to the Food Corporation of India and the question of lifting sugar from any godown, therefore, does not arise at all. The defendant has never dealt with the FCI. He had no business dealings with the plaintiff at any point of time nor did the defendant ever authorize anyone by the name of Sh. L.P. Gupta or Sh. Rajiv Kumar or any other person whatsoever for submitting any tender to the plaintiff at any point of time.
(ii) Sometime in 1997, an official of the plaintiff, whose name and other particulars the defendant does not recall had approached the defendant at his factory and made enquiry of the defendant had submitted the tender. The defendant had informed the said person that the defendant had never sub mitted any tender to the plaintiff and he had no responsibility Suit No. 02/2017 Page 17 of 63 Food Corporation of India V. Urmila Bai & Ors.
in the matter. The defendant assumed that the matter had become clear to the plaintiff and forgot about the same but the defendant was shocked and surprised to receive the sum mons of the suit. The defendant had been suffering from acute kidney trouble and had been advised that he might have to undergo a kidney transplant operation and because of that reason, he was not able to file his Written Statement ear lier.
(iii) The suit appears to be a result of fraud sought to be played upon the defendant by one Mr. L.P. Gupta in collusion with some official/s of the plaintiff. Perusal of the terms and conditions of the tender documents show that thereunder, it is necessary that in case of a tender on behalf of a sole propri etory concern, the same must be signed by the sole proprietor. Where a person signs the tender or any other documents forming part of the tender on behalf of another person, he is required to produce a proper power of attorney duly executed in his favour stating that he had authority to bind such per son in all matters pertaining to the contract. If such person fails to produce such Power of Attorney, the plaintiff has right to cancel the contract and hold the signatory liable for costs and damages. Condition no.3 in this regard is as follows: "Persons signing the tender should state in what capacity he is signing the tender, the sole proprietor of the firm or as Secretary, Managing Director etc. of limited company. In case of a partnership firm, the tender must be signed by all the partners. The per Suit No. 02/2017 Page 18 of 63 Food Corporation of India V. Urmila Bai & Ors.
sons signing the tender form or any other document forming part of the tender on behalf of another per son shall produce a proper Power of Attorney duly executed in his favour stating that he has authority to bind such other person in all matters pertaining to the contract. If the person signing subsequently fails to produce the said Power of Attorney within a reasonable time, the Food Corporation of India may, without prejudice to other civil and criminal reme dies, cancel the contract and held the signatory li able for all costs and damages. The Power of Attor ney should be signed by all partners in the case of partnership firm and in the case of Limited Com pany, the common seal of the company should be affixed to the agreement."
Besides the above clause, the terms and conditions, as setout in ScheduleII to the tender documents, further stipulate as follows: "Person tendering on behalf of another person should produce a written authority from such other person authorising him to act on behalf of such other person in all matters at the tender sale. In the absence of such authority, the offer, if accepted shall be rejected in the name of actual tenderer and he shall be responsible to the FCI as a result of his action without proper authority".
Besides the above, tender documents require the ten derer to produce a large number of documents to satisfy the plain tiff Corporation that he is eligible for submitting the tenders and had the capacity to perform the proposed contract. In the instant case, the defendant never signed a single document regarding the Suit No. 02/2017 Page 19 of 63 Food Corporation of India V. Urmila Bai & Ors.
alleged tender stated to have been submitted by him to the plaintiff Corporation. It is for this reason that the plaintiff has deliberately not produced the alleged tender stated to have been submitted by the defendant to the plaintiff, which forms the very basis of the whole suit. The plaint does not disclose any cause of action against the defendant. There is no privity of contract between the plaintiff and the defendant.
The plaint is not signed and verified by a duly authorized person on behalf of the plaintiff. No resolution of Board of Directors of the plaintiff has been produced to authorize the filing of the suit by the plaintiff against the defendant. The very manner in which the whole case has been filed itself establishes that the suit is wholly malafide and is initiated to save the skin of some official/s involved in the fraud. A false suit has been filed by the plaintiff against the defendant.
On merits, the contents of the plaint have been denied and it has been submitted that the question of the defendant's ap pointing any person by the name of Sh. Rajiv Kumar or anyone else cannot arise. The defendant never filed any writ petition in the Hon'ble High Court of Andhra Pradesh either himself or through anyone else. The defendant was never a tenderer and did not par ticipate in any negotiation with the plaintiff at any point of time. In fact, in his whole life, the defendant has never dealt with the plain tiff. The defendant never submitted any tender nor the defendant was awarded any tender by the plaintiff and therefore, the question Suit No. 02/2017 Page 20 of 63 Food Corporation of India V. Urmila Bai & Ors.
of making any payment therein did not arise. The defendant never wrote any letter to the plaintiff at any point of time and the alleged letter/s purported to have been written by the defendant to the plaintiff have been written on forged stationery using the name of the defendant. The defendant never had to lift any sugar from any godown of the plaintiff at any point of time. So far as the records of Hon'ble High Court of Andhra Pradesh is concerned, that would make it abundantly clear that the defendant was never a party in the matter. The defendant never committed any breach of contract. It has been prayed by the defendant to dismiss the suit with costs. REPLICATION AND ISSUES Plaintiff has filed the replication controverting the allega tions/ contentions in the written statement of the defendants and contents of the plaint have been reiterated and reaffirmed.
From the pleadings of the parties, following issues were framed vide order dated 18/08/2004:
1) Whether the plaint has been duly signed, verified and in stituted by the plaintiff? OPP.
2) Whether any contract took place between the plaintiff and defendant for purchase of sugar? OPP.
3) Whether the defendant submitted any tender for pur chase of sugar from the plaintiff at any point of time? OPP.
4) Whether the defendant authorized any one for submitting any tender on his behalf of the plaintiff? OPP.
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5) Whether the plaintiff is entitled to an amount of Rs.71,65,617.23 and on what rate and for which period?
Relief?
EVIDENCE OF THE PLAINTIFF AND DOCUMENTS RELIED UPON BY THE PLAINTIFF Plaintiff has led its evidence and examined Sh. Gurmail Singh as PW1, who has filed his evidence by way of affidavit wherein he reiterated and reaffirmed the contents of the plaint and relied upon the following documents :
1. Authorization letter is Ex.PW1/1.
2. Copies of Certificate of registration of Tirupati Khandsari Sugar Factory with Sales Tax Authorities as Ex.PW1/2.
3. Official copy of the notice inviting tender, released in the press is Ex.PW1/3.
4. Tender form pertaining to the defendant is Ex.PW1/4.
5. Photocopy of Authorization letter dated 01/06/1994 is Ex.PW1/5.
6. Negotiation sheet dated 01/07/1994 is Ex.PW1/6.
7. Correspondences of plaintiff with the defendant dated 18/07/1994 and 19/07/1994 is Ex.PW1/7.
8. Letter dated 22/07/1994 is Ex.PW1/8.
9. Telegram dated 03/08/1994 is Ex.PW1/9.
10. Letter dated 08/09/1994 is Ex.PW1/10.
11. Letter dated 17/09/1994 is Ex.PW1/11.
12. Letter dated 19/09/1994 is Ex.PW1/12.
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13. Telegram and confirming letter dated 05/10/1994 are exhib ited is Ex.PW1/13.
14. Telegram dated 10/10/1994 is Ex.PW1/14.
15. Telegram dated 18/10/1994 of the plaintiff corporation is Ex.PW1/15.
16. Telegraph dated 18/10/1994 of the defendant is Ex.PW1/16.
17. Letter dated 27/10/1994 of the defendant is Ex.PW1/17.
18. Letter dated 31/10/1994 of the defendant is Ex.PW1/18.
19. Letter dated 02/11/1994 of the defendant is Ex.PW1/19.
20. Letter dated 17/11/1994 of the defendant is Ex.PW1/20.
21. Telegram dated 06/12/1994 of the defendant is Ex.PW1/21.
22. Certified copy of W.P. No. 22801/94 and affidavit filed therein is Ex.PW1/22.
23. Certified copy of the order dated 30/12/1994 of the Hon'ble High Court of Andhra Pradesh in WPMP No. 28415/94 is Ex.PW1/23.
24. Communication dated 01/03/1995 of the counsel for the plaintiff Sh. Murthy is Ex.PW1/24.
25. Office copy of the notice inviting tender published in the news paper is Ex.PW1/25.
26. Certified copy of the Writ Petition 6104/95 is Ex.PW1/26.
27. Order dated 03/04/1995 in Writ Appeal No. 227/95 of Hon'ble High Court of Andhra Pradesh is Ex.PW1/27.
28. Report of the enquiry dated 18/07/1996 alongwith its enclo sures is Ex.PW1/28.
Suit No. 02/2017 Page 23 of 63Food Corporation of India V. Urmila Bai & Ors.
29. Affidavit of Sh. L.P. Gupta to the effect that he was authorized by the defendant to file and participate in the tender in ques tion alongwith the acknowledgement is Ex.PW1/29.
30. Visiting card of Sh. L.P. Gupta is Ex.PW1/30.
31. Letter of travel agent alongwith his visiting card, memo and air tickets is Ex.PW1/31.
32. Opinion of the handwriting expert alongwith its Annexures is Ex.PW1/32.
33. Letter dated 08/01/1996 as well as the envelope is Ex.PW 1/33.
On the other hand, the defendants examined defendant no.3 as DW1, who has filed his evidence by way of affidavit wherein he reiterated and reaffirmed the contents of the written statement. The document Ex.DW1/1 mentioned in his affidavit was already marked as Ex.PW1/28 and the witness relied on the same. However, from the perusal of the file it appears that DW1/1 has been wrongly considered to be Ex.PW1/28 but the same is an other document dated 28.6.1996. The said document is filed by the Plaintiff and relied upon the defendant thus there is no dispute as far as the existence of the said document. During the cross exami nation of DW1/1 the following documents were put and exhibited (1) Correspondence dated 22/7/1994 (page No.6566 Exhibit PW1/D1) done by Shri L.P. Gupta with the Plaintiff. (2) The provident fund deduction records for the years 199293 and 199394. These two files are taken on record by denoting Suit No. 02/2017 Page 24 of 63 Food Corporation of India V. Urmila Bai & Ors.
the same as File D1 and File D2.
ISSUE WISE FINDINGS ISSUE NO.1 (1) Whether the plaint has been duly signed, verified and in stituted by the plaintiff? OPP.
The onus to prove issue No.1 was upon the Plaintiff. The PW1 has relied upon Authorization letter Ex.PW1/1 in favour of Senior Manager in order to prove this issue. As per the said document Senior Regional Manager is competent to verify pleadings and sign plaints etc. on behalf of the plaintiff. The defendant has not disputed the same during the cross examination. Accordingly, issue No.1 is decided in favour of the Plaintiff and against the defendant.
ISSUES NO.2 TO 5(2) Whether any contract took place between the plaintiff and defendant for purchase of sugar? OPP (3) Whether the defendant submitted any tender for pur chase of sugar from the plaintiff at any point of time? OPP (4) Whether the defendant authorized any one for submitting any tender on his behalf of the plaintiff? OPP
5) Whether the plaintiff is entitled to an amount of Rs.71,65,617.23 and on what rate and for which period?
The aforesaid issue Nos.2 to 5 are interrelated and inter Suit No. 02/2017 Page 25 of 63 Food Corporation of India V. Urmila Bai & Ors.
connected to each other and accordingly they are decided together. ARGUMENTS AND SUBMISSIONS ON BEHALF OF THE PLAINTIFF (1)It is crystal clear that the defendant objected to the authorization letter issued in favour of Sh. L.P. Gupta on the ground that the Authorization Letter is forged and fabricated and had never been issued by Gauri Shankar. Needless to say if the core documents have been disputed by the defendant then the remedy available with the plaintiff to prove the execution of the contract only through the circumstantial evidence as required under section 5, 6 & 7 of the Indian Evidence Act, 1872.
(2)Even otherwise the objection raised by the defendant is devoid of merit in as much as the condition 3 of the tender document is not mandatory but is directive in nature, therefore now raising objection with regard to not issuing the correct power of attorney is absolutely absurd, more particularly in circumstances where the defendant did not dispute the signature and one of the address appearing on the letter of authorization issued in favour of Sh. L.P. Gupta. (3)Not only this the defendant did not ask any question with regard to affidavit filed by Sh. L.P. Gupta under which it has been specifically stated by Sh. L.P. Gupta that he was authorized by Sh. Gauri Shankar proprietor of M/s. Tirupati Sugar Khandsari Factory, Hyderabad to file and participate in Suit No. 02/2017 Page 26 of 63 Food Corporation of India V. Urmila Bai & Ors.
the tender. Apart from the aforesaid, it is stated that the Central Sales Tax in short CST Number appearing on the letter head is same as appearing in the certificate of registration. Not only this all 3 addresses mentioned on the letter pad under which the authorization was given in favour of Sh. L.P. Gupta were the addresses which belongs to Gauri Shankar or Tirupati Khandsari Sugar Factory. It is further stated that the witness DW1 accepted the factum of existence of jewelry shop at the address given in the letter of authorization and the factory on the address mentioned against the factory address on the letter of authorization. (4)The connection of Gauri Shankar and L.P. Gupta is also apparent from the certificate given by M/s Carlson Wagonlit Travels. M/s Carson certified that Mr. Gauri Shankar owner of M/s Tirupati Khandsari Sugar booked the ticket for Sh. L.P. Gupta and 2 tickets were prepared for Sh. L.P. Gupta under the direction of Sh. Gauri Shankar. The aforesaid facts are sufficient to establish that Gauri Shankar and Sh. L.P. Gupta were having close connection and Sh. L.P. Gupta was authorized by Sh. Gauri Shankar to submit the bid before the plaintiff. At this stage, it is evident to point out here that the signature appearing on the authorization letter and the government document like application for issuance of CST number is absolutely same and there is no dissimilarity in the signature of Gauri Shankar appearing on the authorization Suit No. 02/2017 Page 27 of 63 Food Corporation of India V. Urmila Bai & Ors.
letter and other documents filed by the plaintiff on record. At this stage, it is relevant to point out here that the defendant did not cross examine the PW1 on the aforesaid aspect and accepting the submission made by PW1 in his examination in Chief as it is, therefore the facts which has not been disputed got proved in terms of section 3 of the Evidence Act. (5)Apart from all other submission, it is pointed out that the plaintiff on its own made inquiry with regard to the existence of Tirupati Khandsari Sugar on the addresses available on the letter pad under which authorization was given to Sh. L.P. Gupta. The Enquiry Report placed by the plaintiff after the detailed enquiry has also not disputed by the defendant in the cross examination. Whereas DW1 in cross examination held on 16.01.2012 admitted that "our factory was at Singapore Village, Shankarpalli Mandal, Rangareddy District, A.P." It is stated that the address not confirmed by DW1 in the address appearing on the letter of authorization. Similarly on the cross examination held on 24.12.2014, the DW1 had stated that "At this stage Ex.PW1/5 has been put to the witness and he has been asked to point out as to where signatures of his father appear on this document and the witness replies that the signatures as encircled point `A' appear to be that of his father but he is not sure about the same." This itself is sufficient to prove that L.P. Gupta was authorized by the Sh. Gauri Shankar to submit the bid before the plaintiff. As stated Suit No. 02/2017 Page 28 of 63 Food Corporation of India V. Urmila Bai & Ors.
above, the defendant did not dispute the affidavit of L.P. Gupta nor suggested to CW1 that the said affidavit given by L.P. Gupta is procured in that eventuality the stand of the plaintiff got proved without any doubt.
ARGUMENTS AND SUBMISSIONS ON BEHALF OF THE DEFENDANT (1) The tender documents of the plaintiff require that:
i) The person signing the tender should state in what capacity he is signing the tender. (Whether as sole proprietor Manager Director of Ltd. Company etc.).
ii) In case, the person signing the tender form or any other document forming part of tender on behalf of another person shall produce a proper Power of Attorney duly executed in his favour.
iii) The Power of Attorney has to state that he has (i.e. the attorney) the authority to bind such other person in all matters pertaining to the contract.
iv) If such Power of Attorney is not produced within reasonable time the plaintiff without prejudice to other civil and criminal remedies has to cancel the contract and make the signatory liable for costs and damages.
None of the above requirements are fulfilled in the present case. The plaintiff however, relied on Ex.PW1/29 in support of its contention that Shri L.P. Gupta was authorized by the Suit No. 02/2017 Page 29 of 63 Food Corporation of India V. Urmila Bai & Ors.
defendant. This contention of the plaintiff on the face of it is absolutely specious and unsustainable. By no stretch of imagination Ex.PW1/29 can be termed as a Power of Attorney. Section 85 of the Indian Evidence Act provided that: "Presumption as to powersofattorney. The Court shall presume that every document purporting to be a powerofattorney, and to have been executed before, and authenticated by, a Notary Public, or any Court Judge, Magistrate, [Indian[ Consul or ViceConsul, or representative of the [Central Government], was so executed and authenticated."
Once a Power of Attorney executed and authenticated as per Section 85 of Indian Evidence Act is produced in evidence a presumption arises that such a document is a Power of Attorney. The presumption however, is rebuttable presumption and it is open to the party to show that the document is not a Power of Attorney. The Hon'ble Supreme Court in Jugraj Singh & Anr. Vs. Jaswant Singh & Ors. 1970 (2) SCC 386 held: "The short question in this case is whether Mr. Chawla possessed such a power of attorney for executing the document and for presentation of it for registration. Now, if we were to take into account the first power of attorney which was executed in his favour on May 30, 1963, we would be forced to say that it did not comply with the requirements of the law and was ineffective to clothe Mr. Chawla with the authority to execute the sale deed or to present it for registration. The power of attorney was not authenticated as required by Section 33 of the Indian Registration Act which in the case of an Indian residing abroad, requires that Suit No. 02/2017 Page 30 of 63 Food Corporation of India V. Urmila Bai & Ors.
the document should be authenticated by a Notary Public. The document only bore the signature of a witness without anything to show that he was a Notary Public. In any event there was no authentication by the Notary Public (if he was one) in the manner which the law would consider adequate. The second power of attorney however does show that it was executed before a proper Notary Public who complied with the laws of California and authenticated the document as required by that law. We are satisfied that that power of attorney is also duly authenticated in accordance with our laws."
The judgment of Hon'ble Supreme Court rendered in Jugraj Singh (supra) is consistently followed in India by all the Courts, Hon'ble Delhi High Court in Citibank N.A., New Delhi Vs. Juggilal Kamlapat Jute Mills Co. Ltd. AIR 1982 Del 487 at 497 held: "17. For raising a presumption under this section, the twin requirements to be fulfilled are : (1) that document in question must purport to be a power of attorney, and (2) that it must purport to have been executed before and authenticated by a notary public, or any court, judge,magistrate, Indian consul, or viceconsul, or representative of to Central Government. Exhibit P42A is a document which purports to be a power to be a power of attorney. It further purports to have been executed before and authenticated by a notary public. Thus, both these requirements stand fulfilled and there is no dispute to this extent.
... ... ...
20. In the absence of any provision contained in Suit No. 02/2017 Page 31 of 63 Food Corporation of India V. Urmila Bai & Ors.
Section 85 of the Evidence Act, any party to a suit, etc. relying on a power of attorney would have to prove it like any other document by producing in the witness box the executant of the document, or the person in whose presence it was so executed, or the person acquainted with the signatures of the executant, etc., as the case may be. If that party is a company incorporated in India or in any other country, it would be further required to prove that the person or persons executing the power executing the power of attorney on its behalf had been duly authorised by means of a resolution duly passed in accordance with law and the articles of association. The purpose of Section 85, in my view, is to eliminate all this cumbersome evidence in case such a power of attorney is executed before and authenticated by a notary public, or other authorities mentioned therein. If evidence to prove these facts except the fact of execution by the executant was insisted upon, most of the purpose of Section 85 would be frustrated specially in these days of prevalent international trade."
The twin requirements to be fulfilled in respect of a Power of Attorney viz. (i) the documents must be purported to be a Power of Attorney and (ii) it must be executed before and authenticated by a notary public are not fulfilled in the present case. The document Ex. PW1/29 was NOT purported to be a Power of Attorney. The document was titled "TO WHOM SO EVER IT MAY CONCERN" and NOT as Power of Attorney. Thus, the document did not fulfill the first requirement of Section 85 of the Evidence Act. The document also did not fulfill the second requirement of Suit No. 02/2017 Page 32 of 63 Food Corporation of India V. Urmila Bai & Ors.
execution before and authentication by notary public. Therefore, the said document taken at its face value is not a Power of Attorney. (2) The document is also not in conformity with the requirements as per the tender documents of the plaintiff. As per tender document of the plaintiff Ex.PW1/4, where a person signs a tender or any other document forming part of the tender on behalf of another person, he is required to produce a 'proper power of attorney duly executed in his favour stating that he has authority to bind such other person in all matters pertaining to the contract. Ex.PW1/29 relied by the plaintiff did not contain any such clause. Thus there Ex.PW1/29 is not a power of attorney as required under Section 85 of the Evidence Act and tender document Ex. PW1/4 of the plaintiff and the plaintiff could not have acted upon the same. (3) The plaintiff also could not have acted upon Ex.PW1/29 as the said document on the face of it shows that it is a forged/fabricated document. The plaintiff has filed two photocopies of Ex.PW1/29. The first photocopy is available at page 100 of the Documents File. This photocopy did not bear any date. The second photocopy marked as PW1/5 is at page 147 and in this photocopy the date of 1.6.1994 is shown. The plaintiff made no effort to explain who had inserted the date when and how the plaintiff could act on the same when the document was tampered with. Further, Ex.PW1/29 shows that the purported authorization was typed in six sentences Suit No. 02/2017 Page 33 of 63 Food Corporation of India V. Urmila Bai & Ors.
and is occupying just about three centimeters on top portion of the purported authorization. Thereafter there is nearly 6 centimeter of blank space after which the purported authorization was signed. This clearly shows that in case of signature is not forged and is a genuine one, the plaintiff and Sh. L.P. Gupta have fabricated and got typed the matter purportedly authorizing Sh. L.P. Gupta to sign on behalf of the defendant.
(4) The Ex.PW1/4 stipulated the recourse the plaintiff was to take in case proper power of attorney was not produced by the signatory to the tender. It provided that "If the person signing subsequently fails to produce the said power of attorney within a reasonable time, the Food Corporation of India may without prejudice to other civil and criminal remedies cancel the contract and held the signatory liable for all costs and damages.' It is pertinent to point out that the plaintiff could not have acted on the photocopy of purported authority either dated on undated. The plaintiff was under an obligation to call upon the signatory of the tender to produce a proper power of attorney. Even according to the plaintiff, the defendant was approached only once through Senior Regional Manager who submitted his report on 28.6.1996 (Ex.PW1/28). In the report the Senior Regional Manager specifically stated that "after further enquiries, I contacted personally Sh. Gowri Shankar Agarwal at Sri Balaji Jewellery, Abids, Hyderabad. He Suit No. 02/2017 Page 34 of 63 Food Corporation of India V. Urmila Bai & Ors.
informed me that he did not know anything about the tender of damaged sugar". Assuming the officers of the plaintiff have acted bonafide till 28.6.1996, there was no reason after the report dated 28.6.1996 to act upon the purported authority. In view of the stipulation in the tender document of the Plaintiff that "If the person signing subsequently fails to produce the said power of attorney within a reasonable time"
the plaintiff was under an obligation to obtain a proper power of attorney. Interestingly, in spite of the specific report of the officer of the plaintiff that the defendant had informed the plaintiff that he did not know anything about the tender, the plaintiff did not call upon Sh. L.P. Gupta to produce proper power of attorney. Even Ex.PW1/29 was obtained by the plaintiff only on 20.9.2004. This clearly shows the connivance and collusion between the officers of the plaintiff and Sh. L.P. Gupta.
Further, in view of the specific stipulation requiring the plaintiff to hold the signatory liable in case the signatory fails to produce proper power of attorney, the plaintiff has no other option but to hold the signatory i.e. Sh. L.P. Gupta liable for all costs and damages. The plaintiff however, conferred all the benefits on Sh. L.P. Gupta and filed the present frivolous and fraudulent suit against the defendant.
In spite of above voluminous evidence showing that Ex.PW1/29 is not a power of attorney and prima facie is a Suit No. 02/2017 Page 35 of 63 Food Corporation of India V. Urmila Bai & Ors.
fabricated document and once the signatory fails to produce proper power of attorney, the only option available with the plaintiff is to make the signatory liable, the counsel for the plaintiff contended that the plaintiff is satisfied that Ex.PW1/29 is a proper power of attorney and the plaintiff having been satisfied with the bonafides of Sh. L.P. Gupta hence, filed the suit against the defendant. This contention on the face of it is specious. The plaintiff is not above the law and cannot ignore the legal requirements and facts and contend that in spite of law and its own documents requiring to make the signatory liable still it would proceed against the defendant. It is respectfully submitted that it is not even open to the plaintiff to contend that it is satisfied with Ex.PW1/29 as the power of attorney is a legal requirement and not the absolute discretion of the plaintiff.
In view of the position explained above the suit is liable to be dismissed. Hence, various pleas and allegations and evidence brought on record by the plaintiff are dealt thereafter just to show how specious and irrational is the stand of the plaintiff is.
(5) The plaintiff filed list of witnesses on 03.12.2004 (at pages 125127) seeking to examine 16 witnesses to prove its case.
The list of witnesses included the officers who have purportedly investigated the matter, the hand writing expert who purportedly gave an opinion regarding the signatures of Suit No. 02/2017 Page 36 of 63 Food Corporation of India V. Urmila Bai & Ors.
Shri Gauri Shankar and Sh. L.P. Gupta, the purported attorney of the defendant. The plaintiff however, close to examine only one witness viz; Shri Gurmail Singh AGM (QC) of the plaintiff, who was examined as PW1. PW1 filed affidavit of evidence marked as Ex. PW1/A. The witness exhibited 33 documents viz; Ex.PW1/1 to Ex.PW1/33. It is pertinent to point out that the witness had no personal knowledge about the case and he merely deposed on the basis of office records. During the cross examination the witness stated that between April, 1994 and April, 1995 (i.e. during the relevant period) he was posted in Ludhiana depot of the plaintiff. The witness initially made a false statement that "I have personal knowledge about the facts of the present case ....". The witness however, in the cross examination admitted that "I have all the knowledge about the facts of the case on the basis of record/documents available with FCI. It is correct that my knowledge is based on records with FCI and have no personal knowledge as I was not posted in Delhi during the time."
In view of the admission of the witness that he had no personal knowledge about the case and his knowledge was entirely derived from the records/documents of the plaintiff, his evidence is of no value at all and cannot be considered for adjudicating the disputed question of facts of which he had no personal knowledge. The following statements of the witness are however, relevant and disprove the case of the plaintiff.
Suit No. 02/2017 Page 37 of 63Food Corporation of India V. Urmila Bai & Ors.
(6) It is pertinent that each and every transaction each every act was done by Sh. L.P. Gupta. The witness admitted that "Except the authorization letter given by Shri Gauri Shankar, there is no other correspondence with FCI or documents with FCI signed by Shri Gauri Shankar and the address mentioned in para 4". The witness admitted that the plaintiff had obtained Ex.PW1/29 (the original purported authorization letter) on 20.09.2004 alongwith affidavit of Sh. L.P. Gupta. The witness further stated that "Investigation team could tell what was the occasion for handing over original with affidavit by Shri L.P. Gupta in the year 2004". In response to the question as to whether, any investigation was carried out to find out where the money for the transaction has come from the witness stated that "it is not the duty of the investigating team to find out the same". The witness who deposed on the basis of official records refused to produce the relevant records on the ground that whatever documents relevant to the case of the plaintiff have been placed on record and the witness cannot be forced to produce the remaining documents. Responding to the question as to whether any investigation was made as to who made the payment for the tickets purportedly booked by the defendant, the witness answered that no enquiry was made as to who made the payment for the tickets, disproving the allegation that the defendant had booked the tickets. The witness further stated Suit No. 02/2017 Page 38 of 63 Food Corporation of India V. Urmila Bai & Ors.
that he joined office in 2006 and do not know whether any enquiry was conducted before filing of the suit. This statement on the face of it is false as the said witness marked the report of Senior Regional Manager dated 28.06.1996 (Ex. PW1/28), who conducted the investigation prior to the filing of the suit.
(7) From the evidence on record it is clear that the officers of the plaintiff knew from the inception that Shri L.P. Gupta was not authorized by the defendant for submitting the tender and has no connection with the plaintiff. The officers of the plaintiff knew that Shri L.P. Gupta was not the Manager and has no connection with the defendant. The officers of the plaintiff also knew that the defendant has nothing to do with 101, Business Tower the purported correspondence address of the defendant.
(8) From the evidence on record (Ex.PW1/3) it is clear that 'licensed/registered dealers, who are manufacturing Toffees/Lozenges, Sugar Candy, Khandasari, Confectioneries, Boora, Kulia, Patase and Misri' only are qualified to participate in the tender. The defendant is a licensed/. Registered manufacture of Khandasari Sugar and is qualified to participate in the tender. It is also clear that Shri L.P. Gupta is not manufacture as required under the tender notice and did not possess necessary license for participating in the tender. It is clear from the evidence on record that Shri L.P. Suit No. 02/2017 Page 39 of 63 Food Corporation of India V. Urmila Bai & Ors.
Gupta in collusion and connivance with the officers of the plaintiff misused the license of the defendant and submitted the tender. It is also clear from the evidence on record that Shri L.P. Gupta deposited Rs.40,00,000/ with the plaintiff and was permitted to lift the proportionate stock by 30.09.1994. It is pertinent to point out that the plaintiff concealed this fact of permitting Shri L.P. Gupta to lift the stock proportionate the amount deposited by Shri L.P. Gupta. Thus, the plaintiff conferred all the benefit on Shri L.P. Gupta is seeking to make the defendant liable though there is not an iota of evidence to connect the defendant to the entire transaction.
(9) But for the connivance of the officers of the plaintiff, the plaintiff would not have accepted the alleged Authority letter purportedly issued by the defendant in favour of Shri L.P. Gupta. The officers of the plaintiff knew that Shri L.P. Gupta is not the Manager of the defendant. According to the plaintiff, the matter was investigated by the officers of the plaintiff before (in 1997) as well as after (in 2004) institution of the suit. The purported investigation is merely an eye wash to buttress its fraudulent stand and not to find out the truth. For example, according to the plaintiff Shri L.P. Gupta was the Manager of the defendant. If Shri L.P. Gupta was in fact the Manager of the defendant and in fact the officers of the plaintiff carried out any meaningful investigation, they would Suit No. 02/2017 Page 40 of 63 Food Corporation of India V. Urmila Bai & Ors.
have asked Shri L.P. Gupta to produce some evidence to show that he was the Manager of the defendant such as the appointment letter (whereby Shri L.P. Gupta was appointed as the Manager) proof of payment of salary, provident fund records and other statutory documents showing that Shri L.P. Gupta was employed by the defendant. It is however, clear from the evidence on record that the officers of the plaintiff knowing full well that Shri L.P. Gupta was not the Manager of the defendant rather than procuring meaningful and acceptable proof in support of the allegations that Shri L.P. Gupta was the Manager of the defendant merely obtained an affidavit (Ex.PW1/29) from Shri L.P. Gupta claiming that he is the Manager of the defendant. This affidavit by Sh. L.P. Gupta rather than showing that he was the Manager of the defendant merely shows the crude efforts of the plaintiff to fabricate some evidence and betrays the fraud being played by the officers of the plaintiff in connivance with Shri L.P. Gupta. (10) Similarly, the plaintiff is also insisting that 101, Business Tower is the correspondence address of the defendant. There is not a single document on record to connect the defendant to the said address. The investigation carried out by the Senior Regional Manager before institution of suit clearly revealed the defendant has nothing to do with 101, Business Tower. On the other hand the investigation revealed that 101, Business Tower was the address of Shri L.P. Gupta. (Part of Suit No. 02/2017 Page 41 of 63 Food Corporation of India V. Urmila Bai & Ors.
Ex.PW1/28 at page 63). The plaintiff, however, irrationally and without an iota of evidence is insisting that 101, Business Tower is the correspondence address of the plaintiff. (11) The plaintiff is also irrationally and without an iota of evidence insisting that the defendant had filed number of writ petitions before the High Court of Andhra Pradesh. A perusal of the copies of the writ petitions and affidavits filed before the High Court of Andhra Pradesh clearly and categorically shows that all the petitions were filed by Sh. L.P. Gupta claiming to be the Manager of the defendant. None of the documents relied on by the plaintiff were signed by the defendant. All the documents were signed by Sh. L.P. Gupta only. Thus there is absolutely no basis in support of the allegation of the plaintiff that the defendant had filed the proceedings before the Andhra Pradesh High Court.
(12) The plaintiff also contended that it had obtained the opinion of the hand writing expert that the signature on Ex.PW1/29, the purported authority are genuine signature of the defendant. The expert was also shown as one of the witnesses is the list of witnesses filed by the plaintiff. The plaintiff however chose not to examine the expert witness in order to prove that the signatures on Ex.PW1/29 are the genuine signatures of the defendant. Thus, there is no merit in the contention that the plaintiff had proved the signature on Ex.PW1/29 are genuine signatures. The counsel for the Suit No. 02/2017 Page 42 of 63 Food Corporation of India V. Urmila Bai & Ors.
plaintiff also contended that the defendant witness in the cross examination did not deny that the signatures are that of the defendant. The witness had stated that the signatures on Ex.PW1/29 "appear to be that of his father but he is not sure about the same". This statement by the witness cannot be construed as an admission that the signatures on Ex.PW1/29 are that of the defendant or that the defendant is not required to prove the execution of a power of attorney which requires execution before the authentication by a Notary public. (13) The plaintiff also contended that the defendant ought to have registered an FIR in case the defendant was of the view that a fraud was played upon him. It is pertinent to point out that the plaintiff was under an obligation to make Sh. L.P. Gupta liable and not the defendant. The plaintiff got in touch with the defendant only once and was informed that the defendant has nothing to do with the transaction/ tender. Thus it was for the plaintiff to file an FIR and not for the defendant. In any case the defendant was suffering from acute Kidney problem when the summons in the suit was served on him due to which even the written statement could not be filed in time. Considering his physical condition and the fraudulent nature of the suit an opinion was given to the defendant that no purpose would be served by filing an FIR. In any case filing or non filing of FIR has no bearing whatsoever on the case.
Suit No. 02/2017 Page 43 of 63Food Corporation of India V. Urmila Bai & Ors.
(14) It is pertinent to point out that as the defendant has nothing to do with the transaction/ tender and all the facts are within the exclusive knowledge of the plaintiff the burden of proving the allegations is on the plaintiff. The plaintiff led evidence of only one witness who had no personal knowledge and had deposed on the basis of official records. The witness repeatedly answered that only the investigation team could answer questions put to him during the examination. As the witness was giving answers only partially and is concealing material facts which are available on record the plaintiff was called upon to produce all the records on the basis of which the witness was deposing. In all fairness once a witness is deposing on the basis of records, such records must be made available to the court for proper appreciation of facts, recording a finding and adjudication. This is not a criminal trial and the plaintiff is in the position of an accused in order to claim confidentiality or protection from disclosing self incriminating evidence. It is all the more necessary to produce the entire records as the (only) witness deposed on the basis of records and burden is on the plaintiff to prove the alleged facts. The plaintiff however, refused to produce the records. The court during cross examination of the witness recorded that: "At this stage Ld. Counsel for the defendants states that let the plaintiff be directed to produce the file on the basis of which the witness is deposing, Suit No. 02/2017 Page 44 of 63 Food Corporation of India V. Urmila Bai & Ors.
which is objected to on the ground that whatever documents relevant to the case of the plaintiff has been placed on record and remaining documents, they cannot force to produce them."
(15) This stand of the plaintiff shows that the plaintiff is concealing material facts which are against it from the court. The statement of the plaintiff that whatever documents relevant to the case of the plaintiff have been produced shows that the plaintiff had concealed those facts which do not support the case of the plaintiff but supports the case of the defendant that the defendant has nothing to do with the entire transaction.
(16) The plaintiff who had refused to produce the records when the burden is on the plaintiff called upon the defendant's witness to produce the records/ files pertaining to Provident Fund and ESI in support of its allegation that Sh. L.P. Gupta was the Manager of the plaintiff. Considering the stand of the plaintiff regarding production of document not relevant to the case of a party, the defendant could not have been called upon to prove the case of the plaintiff. The defendant, however, without any hesitation agreed to produce whatever records available with the defendant and in fact did not produce the said records which were marked as File D1 and D2. These files pertain to Provident Funds records of the years 199293 and 199394 and in spite of proving enquiry by the plaintiff nothing was found to connect Sh. L.P. Gupta with the defendant.
Suit No. 02/2017 Page 45 of 63Food Corporation of India V. Urmila Bai & Ors.
(17) The plaintiff was under an obligation to act only on a proper power of attorney purportedly investigated the matter and filed some travel documents contending that the defendant had booked the tickets for Sh. L.P. Gupta (Ex.PW1/31, at pages 157 to 167). The plaintiff however did not examine the travel agency which had booked the tickets or any evidence to show that as to who booked the tickets or who made the payments for the said tickets. It is also not clear whether the purported travel documents are genuine or whether anyone actually travelled on the basis of the said documents. PW1 in his cross examination stated that "Sh. Gauri Shankar and Sh. L.P. Gupta were travelling together and tickets were obtained from Travel Agency which has given the certificate Ex.PW1/31 (Colly.) and original tickets are already on records. It is correct that these documents were obtained from Travel Agency which has given the certificate Ex.PW1/31 (Colly.) and original tickets are already on records. It is correct that these documents were obtained by our investigation team. Original tickets and certificate issued from Carson Wagonlit Travels might have been obtained by the investigation team of (Sic. With) cooperation from Carlson. In view of the said statement of the witness that the documents were obtained by the investigation team and as the witness had no personal knowledge no further question can be put to him particularly as the officers who purportedly carried out the investigation and the travel Suit No. 02/2017 Page 46 of 63 Food Corporation of India V. Urmila Bai & Ors.
agent were shown as witnesses in the list of witness filed by the plaintiff. However, it is pertinent to point out that the air tickets could not have been handed over by the travel agency as they must have been in possession of the person who travelled on the basis of those tickets i.e. Sh.L.P. Gupta. This clearly shows that in spite of the best effort and collusion the plaintiff and Sh. L.P. Gupta could not come out with any evidence to show any link between the defendant and Sh. L.P. Gupta and all that they could do was fabricate of some travel documents. It is further pertinent to point out that PW1 irrationally insisted that the tickets were booked by the defendant without there being any evidence in support of the same. PW1 during the cross examination stated that "(In) Para 26 of my affidavit (sic.is) based on the finding of the investigation team who visited Hyderabad. I mean by book, who booked the ticket and ordinary meaning which is prescribed in Dictionary. We did not make any enquiry as to whom a payment were made for the ticket (sic. who made the payment for the tickets). It is really difficult to comprehend what the plaintiff is seeking to prove from the alleged travel documents. These travel documents rather than showing any link between the plaintiff and defendant merely show that these documents were fabricated by the officers of the plaintiff in collusion with Sh. L.P. Gupta. It is further interesting that the witness has gone to the extent saying that it is not for the Suit No. 02/2017 Page 47 of 63 Food Corporation of India V. Urmila Bai & Ors.
plaintiff to investigate who had made payment for the tendered transaction but investigate into an alleged travel by the defendant. This stand clearly shows that the purported investigation is merely an eye wash and the plaintiff concealed the true fact that the defendant has nothing to do with the transaction and filed the false suit against the defendant for extraneous reasons. In the process the defendant and the LRs of the defendant suffered for decades defending themselves from the malicious and fraudulent suit. FINDINGS OF THE COURT The Court is satisfied about the correctness of the submissions made by the defendant interalia for the reasons emerging from minute scrutiny of judicial records of this case resulting into the following observations: This is the classic case how the fraud was perpetuated by Sh. L.P. Gupta and the same appears to be duly supported to the hilt by the Officials of the Plaintiff. Although the matter was clinched by one of the officials of the Plaintiff way back in the year 1996, officials of the Plaintiff are clandestinely put the blanket on the said enquiries and investigation. However, as per deposition PW1 there were detailed enquiries done by the officials of FCI but they have not brought to the knowledge of the Court and withheld those detailed enquiries. The Letter dated 28.6.1996 which was filed by the plaintiff and relied upon by the defendant is reproduced herein for apt understanding: Suit No. 02/2017 Page 48 of 63 Food Corporation of India V. Urmila Bai & Ors.
"TO THE DISTRICT MANAGER FOOD CORPORATION OF INDIA DISTRICT OFFICE, TARNAKA.
Sir,
Sub: Recovery of risk and cost amount from
M/s. Thirupathi Khandasari Sugar Factory, Hyderabad correct address of the party and present business and property details - Furnished
- Reg.
Ref: No.SUGAR 16(1)/9495 dt.25.6.96 of DM, FCI, DO, Tarnaka enclosing RO letter.
o0o As per the instructions of District Office vide reference above I personally went to Tilak Road, Abids, Hyderabad on 26.6.1996 to enquire into the details of the firm M/s. Thirupathi Kandasari Sugar factory, its telephone Nos. etc. The firm was represented by its proprietor Sri Gowri Shankar Agarwal, No.101, Business Towers, Tilak Road, Hyderabad and his authorised representative of the firm Sri L.P. Gupta.
After making thorough enquiries it is found that the said Sri Gowri Shankar Agarwal of M/s. Tirupati Kandasari Sugar Factory is not available in the said address of Tilak Road, Hyderabad. Sri L.P. Gupta, the authorised representative of the firm M/s. Tirupathi Kandasari Sugar Factory is also not available at the said address.Suit No. 02/2017 Page 49 of 63
Food Corporation of India V. Urmila Bai & Ors.
After further enquiries, I contacted personally Sri Gowri Shankar Agarwal at Sri Balaji Jewellery, Abids, Hyderabad. He informed me that he did not know anything about the tender, of damaged sugar.
AS per the information furnished by Sri Gowri Shankar Agarwal, I went again to Tilak Road, Hyderabad and enquired deep about L.P. Gupta at S.M. Pearls which is maintained by Shri Sudhir Gupta son of Sri L.P.Gupta. The where abouts of sri L.P.Gupta is not informed in the above shop. However I have collected visiting card of S.M.Pearls and the telephone number 525674 where L.P.Gupta may be available.
Sri Gowri Shankar Aggarwal gave a blank copy of the letter head where the firm Tirupathi Khandasari Sugar Factory is exactly located alongwith its telephone number and its Head Office address.
Further I visited the revenue authorities to furnish the property details of Sri Gowri Shankar Agarwal.
The concerned revenue authorities informed me that they will not give any information unless they receive an authorised letter from Regional Office, FCI, Hyderabad.
Yours faithfully,
sd/
( K.HARI DAS )
ENCL : ASST.MANAGER (QC)
1. Blank copy of the
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Food Corporation of India V. Urmila Bai & Ors.
letter head of M/s. Tirupathi Khandasari Sugar Factory with location and address.
2. Visiting card of S.M.Pearls, Tilak Road, Hyderabad."
(Portion highlighted to demonstrate) The aforesaid letter in form of enquiries clearly demonstrate that said Officer had categorically submitted that he had found Shri Sudhir Kumar Gupta son of Shri L.P. Gupta at the Tilak Road Address. Thus there was the connection of Shri L.P. Gupta on the address of Tilak Road Address as his son Shri Sudhir Kumar Gupta was running the shop with name and style of S.M. Pearls and the said officer did not find the original defendant Shri Gowri Shankar at the said address. In this manner the officials of the plaintiff knew right from the year 1996 that the original defendant Shri Gowri Shankar was not having any connection at the address at 101, Business Towers, Tilak Road, Hyderabad - 500001, Andhra Pradesh and the said enquiries were made about one and half years prior to filing of the suit. The said enquiries clearly revealed that Shri L.P. Gupta was having the connection with said shop as his son was running the shop.
It is apt to reproduce the formation of the Letter head and its printed contents on the Authorization letter i.e. Ex. PW1/5 (Photocopy) and Ex. PW1/29 (Original) in order to unearth the high handedness of Shri L.P. Gupta.
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"APGST NO. PJT/10/1/1269/9192 (logo telephone) Offi: 240096 CST NO. PJT/10/1/1046/9192 Fact: 228 Resi: 229110 Tirupati Khandsari Sugar Factory HEAD OFFICE: Sri Balaji Jewellers FACTORY 2nd Floor, Flat No.201, 41968/1, Abid Road, Village Singapur, Badruka Enclave, 82683/A, Hyderabad500001,A.P Mandali Shankerpalli Road No.12, Banjara Hills, Hyd. (Rubber Stamp Dist. Ranga Reddy(A.P.) Of Balaji Jewellers and its address) Date___________"
The perusal of the aforesaid Letter Head, it clearly demonstrates there is no correspondence address of 101, Business Towers, Tilak Road, Hyderabad - 500001, Andhra Pradesh mentioned in the aforesaid Letter Head which was alleged by the Plaintiff to be issued by the defendant Shri Gowri Shankar. One fails to understand that how come since beginning the Plaintiff got the correspondence address of aforesaid Tilak Road and from which communication they got the said address when as per the case of the Plaintiff they allowed Shri L.P. Gupta to bid the tender on behalf of Tirupati Khandsari Sugar Factory on the basis of the alleged Authorization letter. The said address was must have only and only provided by Shri L.P. Gupta so that no communication would reach Shri Gowri Shankar at his real addresses. The perusal of the judicial record reveals that the entire communication was done by the Plaintiff at the said address 101, Business Towers, Tilak Road, Suit No. 02/2017 Page 52 of 63 Food Corporation of India V. Urmila Bai & Ors.
Hyderabad - 500001, Andhra Pradesh and they have not communicated at any other address.
The Plaintiff has relied upon the certain communications dated 22/7/1994 (page No.6566 Exhibit PW1/D1), 8/09/1994 (page No.67), 17/09/1994 (page No.68) and 19/09/1994 (page No.69) which was sent by Shri L.P. Gupta either as Manager of Tirupati Khandsari Sugar Factory or simply as Shri L.P. Gupta. The letters dated 22.07.1994 and 8.9.1994 were signed by Shri L.P. Gupta as Manager Tirupati Khandsari Sugar Factory and the letters dated 17.9.1994 and 19.9.1994 were sent by Shri L.P. Gupta in his own individual capacity and not as manager of the said concern. It is apposite to mention here the alleged Authorization Letter was mentioned to be dated 01/6/1994 and the said correspondences which were done by Shri L.P. Gupta were also of the contemporary period. It is apt to reproduce the formation of the Letter head of the said correspondences and its printed contents in order to unearth the high handedness of Shri L.P. Gupta.
"APGST NO. PJT/10/1/1269/9192 CST NO. PJT/10/1/1046/9192 Tirupati Khandsari Sugar Factory Factory: Correspondence Office Village Singapur, Mandali Shankerpalli 101, Business Towers, Tilak Road, Dist. Ranga Reddy(A.P.) Hyderabad500001 (Logo Phone) 22228 (Logo Phone) 233527"
There is seasaw difference between the formation and Suit No. 02/2017 Page 53 of 63 Food Corporation of India V. Urmila Bai & Ors.
contents of the letter head of Authorization letter and Letter Head of the said correspondences done by Shri L.P. Gupta and the same are also depicted hereinabove and some of them are demonstrated hereinbelow: In the Letter head of Authorization Letter Head there is no mention about the correspondence office i.e. 101, Business Towers, Tilak Road, Hyderabad but in the aforesaid correspondences there is mention of correspondence office including Telephone number. In the Authorization Letter there is mention of Head Office address i.e. 2 nd Floor, Flat No.201, Badruka Enclave, 82683/A, Road No.12, Banjara Hills, Hyd. but the same is totally missing on the letter head of the aforesaid correspondences done by Shri L.P. Gupta. There is no rubber stamp of Balaji jewelers or its address in the correspondence letters done by Shri L.P. Gupta. The Factory address is mentioned on the right side of the Letter Head in the Authorization Letter and in the correspondence letters it is mentioned on the left side. The Phone numbers of Office, Factory and Residence are mentioned on the top of the right side of the Letter Head of Authorization Letter but in the letter head of the correspondences done by Shri L.P. Gupta it is mentioned just below the addresses of Factory and Correspondence Office. There is no column of printed Date in the Letter Head of the correspondences done by Shri L.P. Gupta but in the Letter Head of Authorization Letter there is Suit No. 02/2017 Page 54 of 63 Food Corporation of India V. Urmila Bai & Ors.
column of printed Date on the right side of the Letter Head. In the Letter Head of correspondences done by Shri L.P. Gupta the phone number of Factory is shown to be of five digits and the same is totally different number which was shown in the Letter Head of Authorization Letter. The Phone Number in the Authorization letter Head is shown to be of three digits and the same appears to be three digits on account of the fact that just above the same Phone number of office is mentioned which is of six digits and first three digits appears to be common as against the Phone Number of factory and for this reason first three digits are left blank.
The Phone Number of correspondence address is shown of six digit number so there was deliberateness of Shri L.P. Gupta to show clearly the phone number of correspondence address but wrongly show the phone number of Factory address in the correspondence letters addressed by Shri L.P. Gupta. Most importantly the Letter Head of the correspondences done by Shri L.P. Gupta was made up on Executive Bond Quality but the perusal of alleged Original Authorization Letter Exhibit PW1/29 reveals that the same is not of Executive Bond Quality.
The language of letter dated 17.9.1994 which was sent by Shri L.P. Gupta in his own individual capacity and not as manager of the said concern apparently reveals that Shri L.P. Suit No. 02/2017 Page 55 of 63 Food Corporation of India V. Urmila Bai & Ors.
Gupta categorically stated in the said letter that he will personally pay the amount. In letter dated 19.9.1994 which was sent by Shri L.P. Gupta in his own individual capacity and not as manager of the said concern clearly reveals that he is authorizing his representative Shri Rajiv Kumar to lift the sugar.
The entire case of the Plaintiff hinges upon the Authorization Letter which was alleged to be executed by Gowri Shankar in favour of Shri L.P. Gupta. The Photocopy of the said Authorization Letter was filed by the Plaintiff alongwith the List of Documents dated 11.05.2000. The serial No.26 of the said List of Documents mentions Tender Form filled & submitted by defendant in tender enquiry held on 3.6.1994 with photocopies of enclosures. The photocopy of enclosures includes the said Authorization letter and the same is at page No.100 of the file. Against the printed date column the date on the said Authorization Letter was totally blank i.e. empty and the same does not bear any date. The Plaintiff then filed another Photocopy of Authorization Letter with the List of documents dated 15.10.2004. The said Authorization Letter was mentioned at Serial Number 1 of the said List of Documents and the said Authorization Letter depicts the date of 01/06/I994. The Plaintiff then filed the Original Authorization Letter vide list of documents dated 30th October,2004 filed on 5th (or 15th) November,2004. The same is also shown at Serial No.1 of the List of Documents. As per the plaintiff the said Original Authorization letter was alleged to be received from Shri L.P. Gupta vide Suit No. 02/2017 Page 56 of 63 Food Corporation of India V. Urmila Bai & Ors.
Acknowledgement at page No.149 on or about 20.09.2004.
The above act of the Plaintiff further shows the clandestine motive of the officials of the Plaintiff whereby they have made the real culprit as a tool against the defendant, who was not even in the knowledge what all was done by the Officials of the Plaintiff and L.P. Gupta on his back. The Plaintiff has not even cared to take the Original Authorization Letter from Shri L.P. Gupta at the time of tender or the so called enquiries or investigation done by the officials of Plaintiff. The alleged Authorization Letter was undated and the date was totally blank when it was filed before the court in the year 2000 and suddenly in September 2004 it was collected from the real culprit who appears to have manipulated and fabricated the date in connivance with the concerned officials. The document which was undated suddenly the same became dated and style of filling the date is also unique. The alphabet "I" is used instead of numerical "1" and similarly alphabet "O" is used instead of numerical "0".
It is also apposite to mention here that the alleged Authorization letter authorized Shri L.P. Gupta only to submit tender documents and sign the documents and the said Authorization Letter has nowhere given subsequent power to Shri L.P. Gupta to deal any further other than submitting tender documents and signing the document. It does not reflect that Sh. L.P. Gupta was the manager of the original defendant or his proprietorship concern.
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The perusal of the Authorization Letter further depicts that there is wide gap between the typed portion and the portion where the signatures of the original defendant Sh. Gowri Shankar is reflected. One fails to understand after the typed portion why there was the requirement of keeping such a wide gap for signature.
The Plaintiff has argued in detail regarding the Authorization letter and its contents which is also incorporated hereinabove in the column of written arguments of the defendants and I am in fully agreement with the submissions of the defendants. The DW1 has not admitted the signatures of Shri Gowri Shankar but he has said that it appears to be signatures of Gowri Shankar and he is not sure. The imitation of the signatures of Gowri Shankar on the said document cannot be ruled out in view of discussions made hereinabove. Moreover, the PW1 who was examined as witness was not having personal knowledge in the matter and the expert evidence was not at all examined by the Plaintiff even though his name was reflected in the List of witnesses.
It is further very strange that the officials of the Plaintiff had gone to collect the Original Authorization Letter, Affidavit of Shri L.P. Gupta etc. in the year 2004 but they have not collected any employment document of Shri L.P. Gupta in the nature of salary, PF, ESI etc. so that it could demonstrate that he was at least the employee/manager of the defendant Gowri Shankar and furthermore they could have collected the details of the mode of Suit No. 02/2017 Page 58 of 63 Food Corporation of India V. Urmila Bai & Ors.
payment of about 40,00,000/ lakhs which was alleged to be paid to the Plaintiff. As per PW1 there were investigations done by the officials of FCI then definitely they ought to have done the investigation that from which source the demand drafts were made and whether account of defendant or his proprietorship concern were used to make the said demand drafts, this could have easily unearthed the entire conspiracy and the real culprit would have been brought to book but the officials of the Plaintiff were not interested to dug in deep so that the truth would come out on the surface and the same appears to be for the reasons best known to them. The act of the officials of the plaintiff speaks volumes about the highhandedness of conspiracy between them with Shri L.P. Gupta that they did not want to unearth the truth when there were available documents in the nature of payments alleged to have been made on behalf Tirupati Khandsari Sugar Factory which could have dug out the truth.
The Plaintiff has also relied upon the various writs alleged to be filed by the defendant. The perusal of the same reveals that the same was filed by Tirupati Khandsari Sugar Factory through manager Shri L.P. Gupta. The alleged Authorization Letter does not anyway authorize Shri L.P. Gupta to file the writ petition on behalf of the original defendant or his proprietorship concern. The Plaintiff has also not shown any document which was filed in the said writ petitions showing the authorization by original defendant or its proprietorship concern to file the writ petitions.
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Moreover one fails to understand that when proprietorship has no separate legal entity in the eye of law then why the Plaintiff has not taken the said objections in the writ petitions. The Plaintiff has also not taken any objection in the writ petition regarding the locus standi of Shri L.P. Gupta to file the writ petition when he has not filed any document of his employment as manager or authorization to file writ petitions. It does not lie to the mouth of the plaintiff to say that the plaintiff does not know that proprietorship concern has no separate legal sanctity in the eye of law. The present case has been filed by the Plaintiff against Gauri Shankar submitting him to proprietor of concern and not against the proprietorship concern as the plaintiff knew that proprietorship has not separate legal entity in the eyes of law.
It is very strange that in spite of unearthing the fraud of Sh. L.P. Gupta in the year 1996, the plaintiff has not taken any action against Sh. L.P. Gupta and further in terms of the tender document and schedule of the tender Sh. L.P. Gupta was the necessary and proper party in the present proceedings but the plaintiff has not made Sh. L.P. Gupta as party in the present case. It is on the record that everything has been done by Sh. L.P. Gupta right from filling the tender alongwith documents, giving the address of 101, Business Towers, Tilak Road, Hyderabad - 500001, Andhra Pradesh (which was not the address of original defendant), filing of writ petitions etc. but the plaintiff has not made him the party in the present case, although, the tender document and Suit No. 02/2017 Page 60 of 63 Food Corporation of India V. Urmila Bai & Ors.
schedule thereof provides for the remedy against Sh. L.P. Gupta. This also further reflects the conspiracy on the part of FCI officials with Sh. L.P. Gupta.
The plaintiff is also relying upon the air tickets which they have brought from Carson Wagonlit Travels after the gap of 10 years. The travel agent cannot be expected to have the travel tickets of the original defendant Shri Gowri Shankar or for the matter of Sh. L.P. Gupta. It is further very surprising howcome the travel tickets came into possession of travel agent and further the travel agent has preserved those tickets with them for about 10 years so that the plaintiff can produce as a circumstantial evidence. The PW 1 has not personally collected the travel tickets. PW1 has no personal knowledge regarding those tickets and moreover the tickets would be in possession of the person who has booked the flight and not with the person who was the alleged travel agent. The travel agent has no business to keep with the original tickets of the customers. No reliance can be placed upon the said tickets without there being cogent evidence to that effect.
The Plaintiff has examined only one witness i.e. PW1 who has no personal knowledge of the facts of the case and he has given evasive answers in his cross examination. The Plaintiff has relied upon number of witnesses in the list of witnesses but they have failed to even examine the relevant witness i.e. expert witness, Shri L.P. Gupta and officials from Carson Wagonlit Travels. The Plaintiff has also not examined any person who was the part of the Suit No. 02/2017 Page 61 of 63 Food Corporation of India V. Urmila Bai & Ors.
investigation team and made enquiries with respect to this matter.
The onus of the entire issues was upon the plaintiff but the plaintiff has withheld the best evidence available with them. If the plaintiff would have examined even the relevant witnesses then it could have given the opportunity to the defendant to cross examine the said witnesses. It is well settled law that the marking of Exhibition does not means that the plaintiff has proved the documents. The documents have to be proved in accordance with law which the plaintiff has utterly failed to do so in the present case. The substituted defendants have argued in detail and the arguments of defendants are incorporated hereinabove. The defendants have covered all the points in detail and I am fully in agreement with the arguments address by the substituted defendants.
Cumulatively, in view of the discussions as hereinabove, arguments advanced by the defendants and law cited above, the issues No.2 to 5 are decided against the Plaintiff and in favour of the defendants.
RELIEF From the discussions, as adumbrated hereinabove, I hereby pass the following FINAL ORDER
(i) The suit of the plaintiff is dismissed.
(ii) The parties shall bear their own respective costs.
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Decreesheet be prepared accordingly.
File be consigned to Record Room after due compliance. The copy of this Judgment be sent to the Chairman of Plaintiff i.e. FCI and the Chairman of the FCI would decide in its wisdom whether to take criminal action or not against the persons who were involved in the transaction and committed fraud upon the Plaintiff.
Announced in the open court (ARUN SUKHIJA)
on 29/09/2018 ADJ07 (Central)
Tis Hazari Courts, Delhi
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