Delhi District Court
Brv Retails Solutions vs Gj Freedom Fashion Ltd on 21 December, 2017
IN THE COURT OF DR. HARDEEP KAUR, ADDITIONAL DISTRICT
JUDGE2, DISTT. SHAHDARA, KARKARDOOMA COURTS, DELHI.
New Civil Suit No.:1167/16
(Old CS No. 202/13)
BRV Retails Solutions
Head Office at B17,
East Arjun Nagar,
Karkardooma Shahadra,
Delhi110032. .... Plaintiff
Vs.
GJ Freedom Fashion Ltd
Office at A601, City Point
Next to Kohinoor Hotel
Andheri Kurla Road, Mumbai,
India, PIN 400059
Also at:
Shop no. 4548
Ground Floor, MG Road,
MGF Metropolitan Mall,
Gurgaon PIN122002 ....Defendant
Date of Institution : 23.04.2013
Date of Judgment : 21.12.2017
Decision : Decreed
Suit for Recovery of Rs. 17,67,144/ (Rs. Seventeen Lacs Sixty
Seven Thousand One Hundred and Forty Four).
J U D G M E N T
1. This is the suit for recovery of Rs. 17,67,144/ filed by
plaintiff against the defendant.
Suit no. 1167/16
M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd.
Page no. 1 of 16
Brief Facts:
2. Brief facts as culminated from the plaint is that the plaintiff is proprietorship firm of India having its Head Office at OffB17, East Arjun Nagar, Karkardooma, Shahdara, DelhiI where the plaintiff firm is doing its entire administrative work and entire control and supervision of work and factory at Sahibabad Industrial area Ghaziabad. Mr. Ajay Vedhera is the Prop. of the plaintiff firm. The firm is doing business of designing of showrooms and business offices.
Ajay Vadhera has given special power of attorney to its manager accounts Mr. Gagan Khattar who is well conversent with facts and circumstances of the case, to act, the appear and to represent the plaintiff firm in the matter vide a SPA.
The defendant company is a company incorporated under " The Companies Act" and is engaged in business of garments retails and having various showrooms at different place of India. The defendant company approached the plaintiff firm at its head office B17, East Arjun Nagar, Karkardooma Shahadra, Delhi and assigned a job to design their retails showrooms Delhi, Lucknow, Gurgaon, Chandigarh and Punjab. The plaintiff firm completed the assigned job of the defendant company to their utmost satisfaction, which was according to the specification given by the defendant company in the month of September, 2009. The plaintiff firm also raised the bills to the defendant company as per Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 2 of 16 mercantile fashion and the defendant company provide the CForm against the bills given as the defendant company is registered with central sales. The bills which have been served on the defendant company are filed with the plaint.
It is further stated that the defendant company had paid a sum of Rs. 90,66,000/ ( Rs. Ninety Lacs Sixty Six Thousand) as "on account" payment and promised to pay the rest of amount gradually. The last payments made by the defendant company was on 29.11.2012 vide cheque no. 127443 dated 27.11.2012 drawn on HDFC bank at plaintiffs office at Delhi.
Plaintiff firm while calculating its account book, discovered that a Rs. 16,69,742.69/ (Rs. Sixteen Lacs Sixty Nine Thousand Seven Hundred Forty Two Paisa Sixty Nine) was due upon the defendant company. Then the plaintiff firm sent its official to the account department of the defendant company to ask for the payment due to them. The officials of the defendant Company then assured to the representatives of the plaintiff firm about the payment of the residual amount which was due to them that they would make it soon. The plaintiff firm several times sent its official to inquire about the payment which was due to defendant company but it was of no avail. Defendant company each and every time assured them that as soon they would receive the payment from their client, they will forward the same to the plaintiff firm. The plaintiff firm several times sent Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 3 of 16 reminder to the defendant company and demanded their money through email but the defendant company did not pay any heed on the request and made false excuses for not paying the amount.
The plaintiff firm demanded their due through telephone, written reminder, personal visit to the defendant company, through post, but the defendant company neither responded the letters not paid the amount. In the mid of February 2013, plaintiff firm requested to Defendant Company to pay the amount which is due to them several times but the defendant company has not paid any attention towards the plaintiff firm and made false and baseless excuses for non payment. The defendant company's promise to pay the sum of Rs. 16,69,742.69/ ( Rs. Sixteen Lacs Sixty Nine Thousands Seven Hundred Forty Two Paisa Sixty Nine) proved to be a blanket promises and the defendant company has never kept its promises fulfilled according to the mercantile fashion which is in vogue and instead of paying outstanding amount which was due upon them, they have turned their face from the plaintiff firmand started business with another company.
When the defendant company did not pay the balance amount, the plaintiff firm sent a legal notice to the defendant company through its undesigned counsel, which has been duly served upon the defendant company but the defendant company did not pay the said amount. It is Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 4 of 16 further stated that the plaintiff firm also sent several emails to the defendant company and demanded the remaining balance but the defendant company did not pay any heed on the request of the plaintiff firm rather made false excuse for not paying the whole amount.
According to the facts and circumstances mention hereinabove, the defendant company is liable to pay a sum of Rs. 16,69,742.69/ ( Rs. Sixteen Lacs Sixty Nine Thousands Seven Hundred Forty Two Paisa Sisty Nine) along with interest @ 10 % per annum from the date of last payment till the date of filing ie. Rs. 97,402/ which amounts to Rs. 17,67,144/ ( Rs. Seventeen Lacs Sixty Seven Thousand One Hundred and Forty Four) along with the liquidated damages and penal interest at the rate of 24% per annum.
It is further stated that the plaintiff firm has reason to believe that the defendant company is financially insolvent and its liabilities are far in excess of its assets and the defendant company can't function profitably any more. In view of its bad financial position, the defendant company may resort to fraudulent preferential payment to choose creditors and likely to dispose off its assets and properties for the said purpose. The defendant company's failure to make payment of the outstanding dues of Rs. 17,67,144/ ( Rs. Seventeen Lacs Sixty Seven Thousand One Hundred and Forty Four) itself shows that the defendant company is unable and not willing to pay its debt. Hence, the present suit.
Suit no. 1167/16M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 5 of 16 2 Written statement has been filed on behalf of defendant company stating that plaint does not give necessary particulars i.e. dates of various events alleged in plaint. The entire plaint is vague and does not give specific dates to constitute a cause of action for filing the plaint.
Paras 6 to 11 and 13 to 16 of the plaint do not disclose any dates at all of happening of alleged events. Para no. 5 and 9 of the plaint are also vague as far as necessary particulars/dates are concerned. Further, particulars of bills raised, invoices, details of payment etc are also not mentioned in plaint. It is further stated that the suit is abuse of process of law as the plaintiff has obtained an excess payment of Rs. 18,59,597/ from the defendant which the defendant is liable to receive back alongwith interest. The plaintiff itself is guilty of breach of contract by committing delays in execution of project as well as executing defective work for which the defendant suffered losses. The alleged bills/statement of account of plaintiff is fabricated. Plaintiff has raised several bills of same number. In commercial trade no two bills can have the same number which shows that the plaintiff's account and bills are fabricated and not in accordance with commercial practices.
In para no. 5 of parawise reply of written statement, defendant company has denied that the plaintiff firm completed the assigned job with utmost satisfaction of the defendant company. It is stated that the work of the plaintiff Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 6 of 16 firm was far from satisfactory. It is also stated that there were innumerable delays on the part of the plaintiff in executing the assigned work, due to which the defendant company suffered huge losses. The defendant company has taken on rent the various showrooms and renovation work for these showrooms was assigned to the plaintiff firm. The work of the plaintiff firm was time bound scheduled as the sales from the said showrooms was to commence as early as possible as the defendant company had already started paying the rent to the owners of the said showrooms from whom the premises were taken on rent. However, the plaintiff inordinately delayed execution of the assigned work due to which the showrooms could not be made operational and the defendant company was burdened with payment of the rent for the said showrooms and due to the breach on the part of the plaintiff firm. The overspread period, resulting from the plaintiff's firm delay, resulted in huge losses to the defendant company by way of payment of rent on one hand and absence of sale of the various articles on the other hand.
It is further contended that plaintiff firm has admitted the amount of Rs. 90,66,000/ having been received from the defendant company towards the work executed by the plaintiff firm. It is however, stated that the defendant company has in fact paid a total sum of Rs. 1,03,69,551/ to the plaintiff firm, the details of which has Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 7 of 16 been filed alongwith the written statement. Defendant company has denied that a sum of Rs. 16,69,742.69/ is due by the defendant to the plaintiff.
As far as the statement of account prepared by the defendant company, a sum of Rs. 1,03,69,551/ has been paid by the defendant company to the plaintiff firm as against the invoices/bills/statement of the plaintiff showing the claim of Rs. 85,09,654/. There is clearly an excess payment of Rs. 1859897/ paid over by the defendant company to the plaintiff firm.
The excess payment has been made on account of the fact that all the payments to the plaintiff firm were "on account" payment and on adhoc basis subject to reconciliation at the closure of the project. However, the plaintiff firm kept on demanding the payment from time to time and even threatened to stop work midway in case the demands of the plaintiff are not met. The documents/statement of account filed by the plaintiff firm alongwith the suit itself shows that the plaintiff firm is entitled only for a sum of Rs. 85,09,654/ against which the plaintiff firm has obtained a sum of Rs. 1,066,9,551/. Hence, an excess payment has been received by the plaintiff firm amounting to Rs. 18,59,897/. This excess payment, the plaintiff firm is liable to return to the defendant company alongwith interest.
3. Replication of written statement of defendant company filed by the plaintiff firm in which plaintiff firm Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 8 of 16 reiterated the contents of plaint and denied the written statement of defendant company.
3. From the pleadings of the parties, following issues were framed by my learned Predecessor vide order dated 28.07.2014:
1. Whether the plaintiff is entitled for recovery of Rs. 17,67,144/? OPP
2. Whether the plaintiff is entitled for interest @ 24 % per annum against the defendant? OPP
3. Whether the plaintiff has obtained an excess amount of Rs. 18,59,897/ from the defendant? If so, its consequences? OPD
4. Whether this court has no territorial jurisdiction ? OPD.
5. Relief.
4. In order to prove its case, the plaintiff firm has examined PW1/ Jyoti Rawat. No other witness was examined on behalf of plaintiff.
PW1 has relied upon the documents i.e. bill sent to/and received by the defendant ( EX PW1/1, colly), cheque dated 26.11.2012 given by the defendant company on 26.11.2012 to the plaintiff (PW 1/2) , C form given by the defendant to the plaintiff (EX PW 1/3 colly), ledger account of the plaintiff firm (EX PW 1/4, colly), Reminder about the payment by the plaintiff to the defendant (EX PW 1/5 colly) postal receipt (EX PW 1/6), legal notice (EX PW 1/7, colly), Postal receipts (EX PW 1/8), emails (EX PW 1/9) and letter dated 13.10.2012 by the plaintiff, PO (EX PW 1/11) and SPA Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 9 of 16 (EX PW 1/12) .
5. Defendant has examined DW1/AR of defendant company and he has relied upon documents already exhibited as EX PW 1/D1 to EX PW 1/D21 and Mark A. Affidavit under Section 65 B of Evidence Act is exhibited as EX DW 1/B.
6. Arguments heard on behalf of the parties. My issue wise findings on the above said issues are as under: (Issue No. 1 & 2) Both aforesaid issues are interconnected and they are decided together. Onus to prove the aforesaid issues were on plaintiff.
7. Onus to prove this issue was on plaintiff. As per plaint, defendant company approached the plaintiff firm at its head office B17, East Arjun Nagar, Karkardooma Shahdara, Delhi and assigned the job to design their retails showrooms at Delhi, Lucknow, Gurgaon, Chandigarh and Punjab and the plaintiff firm completed the assigned job of the defendant company to their utmost satisfaction which was according to the specifications given by the defendant company in the month of September 2009. Plaintiff raised the bills to the defendant company as per mercantile fashion and the defendant company provided Cform against the given bill. Defendant company has paid the sum of Rs. 90,66,000/ as 'on account' payment and promised to pay the rest of amount gradually. The last payment made by the Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 10 of 16 defendant company was on 29.11.2012 vide cheque no. 127443 dated 26.11.2012 (PW 1/2) amount of Rs. 2,00,000/ drawn on HDFC Bank of plaintiff office at Delhi and plaintiff firm while calculating his account book, discovered that sum of Rs. 16,69,742.69/ is due upon the defendant company. Defendant company has sent a mail dated 04.01.2013 to the plaintiff firm (EX PW 1/9 A). On perusal of EX PW 1/9A it is revealed that revealed that the total outstanding amount of plaintiff firm was Rs. 16,69,742.69 and the amount of Rs. 6,95,000/ has been deducted by the defendant company towards 'quality and delay'.
Record further shows that there is no written contract between the parties regarding work done by the plaintiff. Hence, terms and conditions as given in the invoices (EX ...), will determine the condition of work done by the plaintiff firm. These invoices do not show that defendant company has any right to deduct for quality of the work and delay of the work done by the plaintiff firm. On the other hand, DW1 in his cross examination admitted that there is nothing on judicial record to show that due to delay, defendant company has suffered losses, however, the loss is available in our office record. Even Defendant company has not filed any ledger account pertaining to plaintiff firm.
DW1 further deposed that an amount of Rs.
6,95,000/ as mentioned in EX PW 1/9 A on account of deduction is not a hypothetical figure but the same was Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 11 of 16 arrived at by our project team after due assessment. He further deposed that the said report is not on record. He further deposed that he has no idea if the amount of Rs. 6,95,000/ has been entered in the ledger account of defendant company pertains to plaintiff firm. He further deposed that he has no idea if the defendant company had ever sent any communication to the plaintiff firm regarding deduction of Rs. 6,95,000/ on account of delay and quality prior to EX PW 1/9A. He further deposed that he has no idea whether any loss suffered by the defendant company is reflected in the ledger account maintained by the defendant company. He further deposed that no formal notice was issued by the defendant to the plaintiff with respect to deduction of Rs. 6,95,000/ except the E mail EX PW 1/9A. He further deposed that he has not filed any claim to recover excess amount as mentioned in my written statement except in the present case. Defendant company statement except in the present case. D has admitted the claim of the plaintiff by sending email EX PW 1/9A to the plaintiff firm. Hence, issue no. 1 is decided in favour of the plaintiff.
8. As there is no written contract between the parties, hence, claim of the plaintiff regarding interest @ 24 % p.a. is very excessive. Terms and conditions of invoices raised by the plaintiff are also silent on this aspect.
This court is of the opinion that the transaction in question being a commercial transaction, hence, simple Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 12 of 16 interest at the rate of 9% will serve the end of justice. Accordingly, issue no. 2 is decided in favour of plaintiff.
(Issue no. 3)
9. Onus to prove this issue was on defendant. In written statement defendant stated that the defendant has in fact paid a total sum of Rs. 1,03,69,551/ to the plaintiff, and he denied that a sum of Rs. 16,69,742.69/ is due by the defendant to the plaintiff. As far as the statement of account prepared by the defendant, a sum of Rs. 1,03,69,551/ has been paid by the defendant company to the plaintiff firm as against the invoices/bills/statement of the plaintiff showing the claim of Rs. 85,09,654/. There is clearly an excess payment of Rs. 18,59,897/ paid over by the defendant to the plaintiff. The excess payment has been made on account of the fact that all the payments to the plaintiff were "onaccount" payment and on adhoc basis subject to reconciliation at the closure of the project. However, the plaintiff kept on demanding the payment from time to time and even threatened to stop work midway in case the demands of the plaintiff are not met. The documents/statement of account filed by the plaintiff firm alongwith the suit itself shows that the plaintiff firm is entitled only for a sum of Rs. 85,09,654/ against which the plaintiff firm has obtained a sum of Rs. 1,066,9,551/. Hence, an excess payment has been received by the plaintiff firm amounting to Rs. 18,59,897/. This excess payment the plaintiff firm is Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 13 of 16 liable to return to the defendant company alongwith interest.
During cross examination, DW1 has deposed that he has no knowledge if there was any agreement either oral or written for issuance of completion certificate by the defendant company to plaintiff firm. He admitted that there is nothing on judicial record to show that due to delay defendant company suffered loss, however, the loss suffered is available in our office records. Defendant has filed documents Mark A i.e. statement of payment made to the plaintiff firm. During cross examination DW1 deposed that it is correct that Mark A was prepared by defendant company at the time of filing of written statement. He further deposed that there is nothing on record to show that payments reflected in Mark A were made to the plaintiff firm, however record is available in defendant's office. Hence, no statement of account or any other document filed on behalf of defendant company to show that plaintiff firm has obtained an excess payment of Rs. 18,59,597/ from the defendant company. In view of above said discussion, defendant company has failed to prove this issue. Hence, issue no. 3 is decided against the defendant.
(issue no. 4)
10. Onus to prove this issue was on defendant. Record shows that in Para 20 of the plaint the head office of the plaintiff firm is situated in Delhi and the after the detail discussion about the work order i.e. rates, quality, colour etc, Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 14 of 16 deal for doing/designing the offices and showrooms has been finalized at the plaintiff's head office and the defendant company had promised to pay the entire amount at the office of the plaintiff firm at office B17 East Arjun Nagar, karkardooma Shahdara, Delhi. All the terms and conditions of the assigned job, modality and terms and condition of payment has been finalized at its head office and the part payments has been made at the plaintiff firm at Arjun Nagar Delhi, the plaintiff firm did the assigned job at different places of Delhi also as it can be seen from the bills raised to the defendant company at Delhi which is under the territorial jurisdiction of this Court and hence this Court has the territorial jurisdiction to entertain and try the present suit.
Record further shows that defendant has not led any evidence to show that transaction between the parties or cause of action arose outside the territorial jurisdiction of this Court.
Even, no question /suggestion has been put by counsel for the defendant from AR of plaintiff (PW1) during her cross examination regarding the territorial jurisdiction of this Court. Hence, this issue is decided against the defendant.
Relief
11. As issue no. 1 & 2 are decided in favour of plaintiff firm and issue no. 3 & 4 are decided against the defendant company, a decree is passed in favour of the Suit no. 1167/16 M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 15 of 16 plaintiff firm and against the defendant company for a sum of Rs 16,69,742.69/ ( Rs. Sixteen Lacs Sixty Nine Thousands Seven Hundred Forty Two, Paisa Sixty Nine) with simple interest at the rate of 9% per annum, from the date of institution of this suit till actual realization of decreetal amount. Plaintiff shall also be entitled to costs.
12. Decree sheet be drawn accordingly. File be consigned to record room after necessary compliance.
(Announced in the open court (Dr. Hardeep Kaur) on 21.12.2017) ADJ02(SHD)/KKD/Delhi Digitally signed by HARDEEP KAUR HARDEEP Location: KARKARDOOMA KAUR COURTS Date: 2017.12.22 14:06:53 +0530 Suit no. 1167/16
M/s BRV Retails Solutions Vs. GJ FREedom Fashion Ltd. Page no. 16 of 16