Delhi District Court
Padam Chand Jain vs Safepack Industries Ltd And Ors on 26 August, 2023
CNR No. DLCT010042542022
IN THE COURT OF MS. ILLA RAWAT :
DISTRICT JUDGE COMMERCIAL COURT- 03:
(CENTRAL) : TIS HAZARI : DELHI.
CS (COMM) No. 839/2022
In the matter of :-
Padam Chand Jain
Sole Proprietor of M/s Meridian International
B-104, Pal Mohan Plaza,
11/56, D.B. Gupta Road,
Karol Bagh, Delhi-110005
Phone No. 9311166951
Email: [email protected] ......Plaintiff
Versus
M/s Safepack Industries Limited
Through its Director MD/CEO
Mr. Rajendra Tapadia
At GAT No.1093/1094, At Post Shiroli,
Near Chakan, Tai-Khed, Pune,
Maharashtra-410505
Phone No.9860798900
Email: [email protected]
Also at:
Office No.2 Cabin No.1A,
Symphony Survey No.210, 2nd Floor,
Ashok Nagar, Range Hills Road,
Shivaji Nagar, Pune,
Maharashtra-411020 .......Defendant
CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 1 / 22
Date of Institution : 07.03.2022
Date on which Judgment reserved : 26.08.2023
Date on which judgment pronounced : 26.08.2023
SUIT FOR RECOVERY
JUDGMENT
1. Vide this judgment I shall dispose off the commercial suit for recovery of Rs.11,05,573/- along with interest, filed by plaintiff against the defendant.
Though initially the suit was filed against defendant no.1 as well as its CEO/MD and Authorized Representatives, defendants no.2 and 3 respectively, the name of defendants no.2 and 3 were dropped from the array of parties by counsel for plaintiff on 08.04.2022.
2. Briefly stated facts of the case as averred in the plaint are that the plaintiff is the sole proprietor of M/s Meridian International, a firm engaged in business of medical packaging, paper and hospital equipment. The defendant is a company dealing in variety of packaging solutions for Metals, Automotive, Engineering, Electronics, Defence, Pharma etc. and is one of the leading manufacturer of packaging solution in India.
3. It is further averred in the plaint that the defendant approached plaintiff for coating grid lacquer paper which was required by plaintiff and agreed that chemical would be coated on the BILLERUDKORSNS Medical Grade Paper Sterikraft CPS 60 gsm which will be purchased by defendant from plaintiff. The CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 2 / 22 plaintiff apprised the defendant that said coating on paper will be used for heat sealing the PVC Rigid Blister Film upon which defendant informed the plaintiff that it is general trade parlance in medical industry that the said coating is meant for sealing the PVC Rigid Blister Film. The defendant further assured the plaintiff that finished product, after coating, would be of the best quality and would meet the desired requirement of the plaintiff. The defendant also agreed to share the test report. It is stated that after various rounds of meeting and communications between plaintiff and defendant with regard to cost, quality and specification of product and pursuant to assurances by defendant the plaintiff placed purchase order for supply of grid lacquered coated medical grade paper.
4. It is further stated that defendant dispatched ready/finished paper/product to the plaintiff on 22.04.2019 through VRL Logistics Ltd. and the same was received by plaintiff on 27.04.2019. After receiving the said finished product/paper and having believed that product supplied was as per specification, the plaintiff supplied the same to its customers but was shocked to know that finished packaging paper supplied by defendant was not upto the mark as the grid lacquered paper was not getting sealed with PVC Blister Film. This was despite the fact that defendant had been informed that papers were intended to be used and applied to be sealed with PVC Blister Film with optimum seal strength and peel open property required for packaging of sterile medical devices.
5. The plaintiff has further averred that it apprised the defendant regarding the defect in the finished paper upon which CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 3 / 22 defendant assured the plaintiff that matter would be looked into. After various communications and follow ups, the defendant assured the plaintiff that they would send their representative to check the defect and test the paper. On 31.07.2019 defendant send one Mr. Vishal Sarode (Expert) to test and investigate the sealing strength of paper with PVC film and a joint investigation/inspection was carried out by the above named expert/ representative of the defendant and plaintiff at the warehouse of the plaintiff and thereafter inspection/investigation report dated 31.07.2019 was prepared. During inspection/investigation of finished papers/product it was found that sealing strength with PVC film was poor and was not upto the mark. The defendant was provided with samples by the plaintiff for further investigation who in return assured plaintiff that they would revert back with remedial action.
6. It is further averred that despite persistent requests by plaintiff, defendant did not revert back either to rectify the defect or take back the material/product. Rather the defendant started to hold plaintiff responsible for the defect without any plausible cause or tenable reason and continued to defer matter on one pretext or the other. They also asked for details of customers of plaintiff to whom plaintiff intended to supply finished goods. The defendant failed to share test report of the goods despite repeated assurances and requests by the plaintiff leading to presumption that the goods were defective and not upto the mark.
7. It is further averred that as defendant failed to show CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 4 / 22 any willingness to resolve the issue, plaintiff had to reject the finished goods/product as supplied by defendant since the same were not suitable for purpose for which they had been ordered to be used. Plaintiff made several requests to defendant to take back the goods/products which were lying rejected at their warehouse and to remit back the entire amount so received by defendant but defendant did not comply with plaintiff's requests and kept levelling baseless, untenable and false allegations against the plaintiff for not furnishing the details of application of the said paper. This was despite the fact that defendants were very well aware and informed that the desired/required paper were to be sealed with PVC Rigid Blister Film with optimum seal and peel property. The defendant even otherwise knew that in general trade parlance in medical industry the required paper was meant for sealing with PVC Rigid Blister Film and the plea of defendant that they were not aware of the papers for which the product was required had no legs to stand upon.
8. It is alleged that defendant failed to live up to any of the assurances as promised by it. Since defendant neither took back the defective goods nor refunded the amount so received for goods supplied by them, they are not only liable to pay the price of goods purchased towards sample but also the charges @ Rs.5,000/- per month for the warehouse where the goods/paper is lying alongwith interest @ 24% per annum. The plaintiff got a legal notice dated 11.10.2021 served upon defendant, through his counsel, claiming an amount of Rs.9,41,027/- towards cost of goods, freight, forwarding charges and warehouse charges alongwith interest @ 24% per annum. The said notice was CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 5 / 22 delivered upon defendant on 13.10.2021 and was replied to by them vide reply dated 29.10.2021, sent through their counsel, wherein defendant raised false and frivolous defence to avoid their liability.
9. It is averred that plaintiff has exhausted the remedy of pre-litigation mediation provided under the Commercial Courts Act by filing an application U/s 12A of the Act before DLSA, Delhi. The defendant failed to participate in said proceedings despite service of notice. Left with no option plaintiff has filed the present suit.
10. The defendant appeared before the Court on 12.09.2022, through their counsel Sh.Sachin Sharma and filed an application under Order VII Rule 10 CPC for return of the plaint. Subsequently, defendant filed written statement alongwith an application for condonation of delay in filing the written statement on 09.12.2022. The application for condonation of delay in filing the written statement filed on behalf of defendant was dismissed vide detailed order dated 11.04.2023. Accordingly, the written statement filed by defendant was struck off the record. The application under Order VII Rule 10 CPC filed on behalf of defendant was also dismissed vide separate order dated 11.04.2023.
11. Thereafter considering objections taken by defendant in its application U/o VII Rule 10 CPC, following issues were framed on 30.05.2023:-
1) Whether the Court at Delhi has jurisdiction to adjudicate upon the suit filed by the plaintiff?
CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 6 / 22 OP Parties
2) Whether the plaintiff is entitled to decree in sum of Rs.11,05,573/- against the defendant? OPP
3) Whether the plaintiff is entitled to interest. If so, at what rate and for which period? OPP
4) Relief.
12. In order to prove its case, plaintiff has examined himself as PW1. He has reiterated the facts averred in the plaint in his affidavit Ex.PW-1/A and relied upon following documents:-
S.No. Details of documents Exhibit
1. Internet downloaded copy of GST Data of Ex.PW1/1 plaintiff's firm
2. Internet downloaded copy of Master Data of Ex.PW1/2 defendant's company downloaded from MCA-21
3. Computer generated copy of Price Agreements Ex.PW1/3 Cum buy back order
4. Computer generated copy of Customer Ex.PW1/4 Registration Form
5. Computer generated copy of vendor / supplier Ex.PW1/5 Master Data Collection for GST
6. Computer generated copy of Purchase Order Ex.PW1/6 dated 19.03.2019
7. Computer generated copy of Tax Invoices No. Ex.PW1/7 IGST-27149 dated 26.03.2019 issued in favour of defendant
8. Computer generated copy of proforma invoice Ex.PW1/8 issued by defendant to the plaintiff dated 16.04.2019, computer generated tax invoice No.S01KEE000000131 dated 22.04.2019 issued in favour of plaintiff
9. Computer generated ledger account of defendant Ex.PW1/9 maintained by plaintiff from 01.04.2019 till 28.02.2022
10. Copy of Minutes of Meeting dated 31.07.2019 Ex.PW1/10 held between plaintiff and Mr. Vishal Sarode, representative of defendant, sent by plaintiff CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 7 / 22 through email as well as courier (DTDC) with courier receipt and its tracking report
11. Computer generated tax invoice No.IGST 28103 Ex.PW1/11 dated 22.10.2019 issued in favour of defendants
12. Copy and original receipt of booking of Ex.PW1/12 consignment issued by VRL Logistics Ltd. Dated 26.03.2019, 22.04.2019 and 22.10.2019
13. Computer generated e-way bill with unique Ex.PW1/13 No.731062967074
14. Print-outs of emails communications dated Ex.PW1/14 17.01.2019, 24.01.2019, 08.02.2019, 12.03.2019, 15.03.2019, 16.03.2019, 18.03.2019, 21.03.2019, 27.03.2019, 11.04.2019, 17.04.2019, 07.05.2019, 21.05.2019, 25.05.2019, 27.05.2019, 28.05.2019, 07.06.2019, 10.06.2019, 28.06.2019, 23.07.2019, 25.07.2019, 26.07.2019, 13.08.2019, 05.10.2019, 16.10.2019, 21.10.2019, 09.11.2019 and 12.11.2019 between plaintiff and defendant through email
15. Copy of complaint dated 05.10.2019 sent by Ex.PW1/15 plaintiff to defendant through email as well as courier (DTDC) with courier receipt and its tracking report
16. Office copy of legal notice dated 11.10.2021 Ex.PW1/16 issued by plaintiff through his counsel to defendants
17. Original postal receipts for transmitting said Ex.PW1/17 legal notice dated 11.10.2021
18. Reply to legal notice issued by defendant Ex.PW1/18
19. Non-starter report dated 22.02.2022 issued by Ex.PW1/19 DLSA
20. Certificate u/s. 65 B of The Indian Evidence Act Ex.PW1/20
13. During his cross-examination, PW1/plaintiff denied the suggestion that as per proforma invoice issued by defendant only the Court at Pune has jurisdiction over the subject matter of the present suit. He denied the suggestion that this Court does not have jurisdiction to entertain the suit as the subject matter of suit pertains to the quality of the product and not with respect to supply of the product. He also denied the suggestion that suit of CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 8 / 22 plaintiff is false.
14. No other witness was examined on behalf of plaintiff.
15. As defence of defendant had been struck off, opportunity for DE was not called for and hence was not granted to the defendant. Thereafter the matter was listed for final arguments.
16. Arguments were addressed by Sh. Vijay Kumar Wadhwa, counsel for the plaintiff and Sh. Sachin Sharma, counsel for defendant. Written submissions have also been filed on behalf of defendant.
17. Counsel for plaintiff has argued on the lines of the averments made by plaintiff in the plaint and has prayed that plaintiff is entitled to decree of recovery of Rs.11,05,573/- against the defendant based on the pleadings and documents placed on record by the plaintiff.
On the other hand, counsel for defendant has challenged the claim of plaintiff on the ground of jurisdiction. It is stated that plaintiff has wrongly classified the dispute under Section 2(c) of the Commercial Courts Act whereas the dispute falls within the purview of Section 4 of the Sales of Goods Act. It is also contended that plaintiff could not substantiate allegation with respect to quality of products supplied.
18. I have heard the learned Counsels for the parties and CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 9 / 22 have also perused the record and my findings on aforesaid issues are as under:-
ISSUE NO.1 Whether the Court at Delhi has jurisdiction to adjudicate upon the suit filed by the plaintiff? OP Parties
19. The onus of proving this issue was on both the parties.
It is noteworthy that this issue has already been dealt at length while dismissing the application U/o VII Rule 10 CPC, filed on behalf of defendant vide order dated 11.04.2023. Since issue of jurisdiction is a legal issue and considering that defendant had limited right to put forth his defence as its written statement was directed to be taken off the record, the defendant was given one more opportunity to make submissions on this issue.
20. It is argued on behalf of defendant that this Court lacks jurisdiction to try and adjudicate upon the present dispute as only the courts at Pune, Maharashtra possess the appropriate jurisdiction to try and adjudicate upon it. While elaborating upon this plea, it is averred that as per avernments made in the plaint the entire dispute revolves upon the processing/job work and supply of chemically coated grid lacquer paper. The paper upon which chemical process of coating was to be applied by the defendant was to be purchased from the plaintiff himself. The plaintiff sold paper to the defendant company which is situated and carries on business in Pune, Maharashtra. The process of CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 10 / 22 chemical coating/processing was to be conducted by the defendant company at Pune and thereafter processed paper was to be sent to the plaintiff. The entire agreement was entered into at Pune, Maharashtra. The performance of the entire agreement vis.-a-vis. coating process/job work was to be performed at Pune, Maharashtra. As such no cause of action, as alleged by the plaintiff, ever arose within territorial jurisdiction of this Court.
21. It is further argued that plaintiff has filed invoices issued by defendant in support of his claim. The said invoices, more specifically the invoice dated 16.04.2019, clearly mentions "subject to Pune jurisdiction" and under the terms and conditions of supply also, it is categorically agreed that "all transactions subject to Pune jurisdiction". The said terms and conditions of supply form material part of the invoice and have been admitted and accepted by plaintiff by making payment thereunder. The documents have been relied upon by plaintiff in his own evidence and thus the condition "subject to Pune jurisdiction" stands proved by plaintiff himself even though no evidence has been lead by the defendant.
22. It is further argued that although the plaintiff has taken a plea that the defendant company had approached the plaintiff for supply of processed product, from the e-mail dated 17.01.2019 relied upon by the plaintiff as part of Ex.PW1/14 (colly), it is clear that the plaintiff visited defendant's Pune office where entire discussion and finalization of the contract took place. The plaintiff has made misleading avernments in the plaint to make out jurisdiction of the court at Delhi which is belied by CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 11 / 22 the evidence led by plaintiff.
23. It is further argued that after finalization of terms and conditions of the agreement at Pune, the process of coating was performed at defendant's facility at Pune, the invoice for impugned transaction was issued from Pune, the money under said invoices was received at Pune at defendant's registered address and that the defendant resides and works for gain at Pune and in these circumstances also no part of cause of action can be stated to have arisen within jurisdiction of this Court and the suit of plaintiff is liable to be dismissed for want of territorial jurisdiction.
24. Per contra, on behalf of plaintiff it is contented that the jurisdiction of this court cannot be ousted in absence of unambiguous acceptance by the plaintiff. Even otherwise reliance upon the invoices and terms and conditions mentioned thereupon is against the provision of Section 23 and 28 of The Contract Act. It is pointed out that the Price Agreement-cum-Buy Back Order dated 18.03.2019, Ex.PW1/3, was executed and agreed upon between the parties to the suit which was followed by the purchase order dated 19.03.2019, Ex.PW1/6, issued by the defendant and a tax invoice dated 26.03.2019, Ex.PW1/7, issued by plaintiff against the defendant. The said tax invoice and price agreement contain specific term "subject to Delhi jurisdiction"
which defendant had accepted and hence this court has territorial jurisdiction to entertain the present suit.
25. It is further contended that after goods were received CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 12 / 22 at Delhi by plaintiff, the defendant visited Delhi to carry out inspection/test of finish product at the warehouse of the plaintiff at Delhi on 31.07.2019. Payments were made to the defendant from Delhi and paper was also supplied to the defendant by the plaintiff for coating/production by the defendant after which finish product was supplied by the defendant, to plaintiff, at Delhi and refund/price of defective goods was also to be made at Delhi. Besides this overpay amount was also to be paid at Delhi. Since part of cause of action arose at Delhi, this court has territorial jurisdiction to entertain the suit U/s 20 (c) of Code of Civil Procedure.
26. While relying upon the avernments made in the plaint, it is reiterated that the goods/product/paper supplied by the defendant was not as per specification or upto the mark as assured by the defendant and was rejected by the plaintiff. Merely since the processing plant of the defendant was at Pune does not confer the exclusive jurisdiction to Pune Court since the finished product was supplied at Delhi. With respect to the e-mail dated 17.01.2019 and alleged visit by plaintiff to defendant's business premises, it is stated that prior to said visit there were telephonic discussions between the parties since December 2018 to explore the business possibilities. The plaintiff had made a courtesy visit but nothing was agreed upon or finalized during the said visit. The deal was finalized only in the month of March 2019. The defendant is trying to take undue advantage of the courtesy visit made by the plaintiff in an attempt to oust jurisdiction of Court at Delhi. It is reiterated that processing of paper alone would not conferred jurisdiction to Pune Court since CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 13 / 22 as per agreement dated 18.03.2019, Ex.PW1/3, raw paper was to be supplied to the defendant by the plaintiff from Delhi. The paper was to be processed and thereafter plaintiff was to buy back the same and hence this court has jurisdiction as part cause of action has arisen at Delhi. Even otherwise the plaintiff never accepted the jurisdiction of Pune Court either expressly or impliedly by any deed or act.
27. It is lastly stated that defendant has not been able to put forth any worthwhile defence to defend the suit despite being granted opportunity to address arguments even though its defence had been struck off and that the plea of defendant with respect to lack of jurisdiction of the Court at Delhi ought to be rejected.
28. In the instant case, it is not disputed that defendant had purchased paper from plaintiff. The paper was to be put through a chemical process of coating with grid lacquer and was to be sent to the plaintiff at Delhi. Although the place where this buy back agreement was executed between the parties was disputed by the defendant, nothing was put to PW1 during his cross-examination in this regard. It is also not disputed that plaintiff is carrying out its business from Delhi while defendant is based at Pune. The quality and quantity of paper supplied to defendant by the plaintiff is also not disputed. Rather, from the evidence placed on record, it is brought out that it is the plaintiff who was dissatisfied with the coating on the paper done by defendant and supplied by defendant to the plaintiff at Delhi. In these circumstances, the defendant became the supplier of the goods which were supplied by defendant from Pune to plaintiff at CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 14 / 22 Delhi. Thus the Court at Delhi would also have jurisdiction to adjudicate upon dispute, though not an exclusive jurisdiction, as plaintiff is the purchaser of the goods/coated paper. As part cause of action had arisen at Delhi, the fact that processing and chemical coating of the paper was done at the premises of the defendant at Pune would not by itself oust the jurisdiction of Court at Delhi.
29. The next question which arises for consideration of the Court is whether mentioning of "subject to Pune jurisdiction"
on invoice dated 16.04.2019, Ex.PW1/8, issued by defendant would oust the jurisdiction of the Court at Delhi. To counter this argument, Counsel for plaintiff has contended that the invoices referred to by defendant is only a "proforma invoice" whereas the actual purchase order is dated 19.03.2019, Ex.PW1/6, and the same does not find any rider regarding jurisdiction. Furthermore the tax invoice issued by plaintiff finds mention "subject to Delhi jurisdiction" and since the defendant accepted the goods sent vide invoice dated 26.03.2019, Ex.PW1/7, he is deemed to have accepted jurisdiction of Delhi Court even if not exclusive jurisdiction thereof.
30. A specific query was put to counsel for defendant as to use of words "proforma invoice" on invoice dated 16.04.2019, Ex.PW1/8, relied upon by defendant to claim that Court at Pune had exclusive jurisdiction to adjudicate upon the dispute between the parties. No satisfactory reply was forthcoming from the learned counsel. Even otherwise, PW1/plaintiff was not put any question with respect to Ex.PW1/8 during his cross-examination.
CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 15 / 22 On the other hand, plaintiff has placed on record the actual purchase order dated 19.03.2019, Ex.PW1/6, issued by defendant and upon perusal of the same, no condition with respect to jurisdiction of a particular place, in the eventuality of dispute having arisen between the parties, is found mentioned thereupon. Moreover the invoice, Ex.PW1/7, issued by plaintiff on 26.03.2019, does find mention of condition "subject to Delhi jurisdiction".
31. Even when the respective condition on proforma invoice dated 16.04.2019, Ex.PW1/8, issued by defendant and tax invoice dated 26.03.2019, Ex.PW1/7, issued by plaintiff are taken into consideration, the intention of either of the parties to limit the jurisdiction to the Court only at Pune or Delhi is not made out. A part cause of action having arisen at Delhi would necessarily give jurisdiction to Court at Delhi to adjudicate upon the dispute in the instant case and the jurisdiction is under no circumstances ousted by the conditions mentioned on respective proforma invoice dated 16.04.2019, Ex.PW1/8, and tax invoice, Ex.PW1/7, dated 26.03.2019.
32. Admittedly there is no separate agreement between the parties with regard to jurisdiction of the Court which would adjudicate upon the dispute. In these circumstances, based on the buy back agreement, Ex.PW1/3, executed between the parties and observations made in the case of ABC Laminart Pvt. Ltd. v. AP Agencies, Salem (1989) 2 SCC 163, the jurisdiction of Court at Delhi is made out. This issue is decided in favour of the plaintiff and against the defendant.
CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 16 / 22 ISSUE NO. 2 Whether the plaintiff is entitled to decree in sum of Rs.11,05,573/- against the defendant? OPP
33. The onus of proving this issues is on plaintiff. The plaintiff has averred that the defendant approached plaintiff for coating grid lacquer paper which was required by plaintiff and agreed that chemical would be coated on the BILLERUDKORSNS Medical Grade Paper Sterikraft CPS 60 gsm, which will be purchased, by defendant from plaintiff. The plaintiff apprised the defendant that said coating on paper will be used for heat sealing the PVC Rigid Blister Film upon which defendant informed the plaintiff that it is general trade parlance in medical industry that the said coating is meant for sealing the PVC Rigid Blister Film. The defendant, however, failed to give proper coating on the paper and due to defect in finished paper, it lacked optimum sealing strength with PVC Film.
34. The defendant has not disputed that it had purchased paper from plaintiff for chemical coating and that plaintiff had purchased chemically coated paper from defendant. Though the quantity of the paper is not in question herein but the quality of coated paper supplied by defendant to the plaintiff has given rise to dispute between the parties. While the plaintiff claims that defendant failed to live up to its assurance and the coating done by defendant on the paper was defective for it lacked optimum sealing strength with PVC film and could not be used for medical industries, the defendant has disputed that there was deficiency in CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 17 / 22 the service and has alleged that plaintiff had failed to specify for what purpose the product supplied by defendant to the plaintiff was to be used.
35. The plaintiff has examined himself as PW1 and has proved the copy of price agreement cum buy back order/agreement dated 18.03.2019 as Ex.PW1/3. A bare perusal thereof reveals that it finds a heading "Quality Assurance..please note that quality of coating should be perfectly heat sealable with PVC Blister film as on Amcore paper". The other specifications of the paper are also duly mentioned on Ex.PW1/3. In these circumstances, it does not lie with the defendant to dispute the fact that it was not aware of the purpose for which chemically coated paper prepared by it was to be used.
36. As it is borne out from record that defendant has dispatched finished paper/product to plaintiff on 22.04.2019 and the same was received by plaintiff at Delhi on 27.04.2019. The plaintiff vide his mail dated 21.05.2019 conveyed to defendant that the grid lacquered MG paper supplied by them to plaintiff had been rejected as it was not getting sealing with PVC blister film with optimum strength. He requested defendant to depute their official to examine the stock lying at his warehouse. The email dated 21.05.2019 and other emails exchanged between the parties before and after the said email are part of Ex.PW1/14 (colly). It appears that pursuant to these emails, the defendant deputed their official Sh. Vishal who carried out joint inspection of the coated paper and thereafter minutes of meeting dated 21.07.2019, Ex.PW1/10, were drawn up. It is clearly brought out CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 18 / 22 from the said minutes that Sh. Vishal Saroda, employee of defendant found on joint inspection that the sealing of grid lacquered paper with PVC film on hot bar automatic sealing machine had very poor seal strength though sealing with Amcore paper had proper seal strength. A sample of both the papers was handed over to Sh. Vishal for further examination with assurance to revert back for remedial action.
37. Although counsel for defendant has contended that plaintiff failed to prove the defect, if any, in the coating of the paper, the contention that plaintiff ought to have examined Sh.Vishal Saroda as a witness does not hold any ground. It is difficult to comprehend that employee of defendant would testify in favour of the plaintiff.
38. Moreover the plaintiff has examined himself as PW1 in support of his claim. The testimony of PW1 and documents relied upon and proved in accordance with law by him, have been referred to at length in foregoing paragraphs. The testimony of PW1 has remained unrebutted and unchallenged despite his cross-examination by counsel for defendant. Further nothing has been placed on record by defendant to create any doubt with respect to documents referred to and relied upon by PW1 in his testimony. The plaintiff has thus succeeded in proving its case against defendant and the feeble defence put forth by defendant has faded away in oblivion without any legs to stand on.
39. As regards feedback of the product from third party, counsel for plaintiff has contended that plaintiff restrained from CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 19 / 22 supplying coated paper to its customers for he did not wish to supply defective goods to them and to have his image tarnished. The explanation given by counsel for plaintiff seems justifiable. Per contra nothing has been placed on record by defendant from which it can be ascertained that any steps were taken by defendant pursuant to minutes of meeting, Ex.PW1/10 and thus defendant is not permitted to raise a bald argument in this regard at this stage.
40. On behalf of defendant, it is also contended that plaintiff has wrongly classified dispute U/s 2(c) of the Commercial Courts Act whereas dispute fall within the purview of Section 4 of the Sales of Goods Act. The distinction which is sought to be drawn does not in fact exist in view of encompassing definition of "commercial dispute" provided for in Section 2(c) of the Commercial Courts Act, 2015. The sub- clause (xviii), in particular, pertains to agreement for sale of goods or provision of services within which the present dispute squarely falls. The objection taken on behalf of defendant is not sustainable in view of clear definition of "commercial dispute"
contained in Section 2(c) of the Commercial Courts Act, 2015.
41. Accordingly, defendant is held liable to pay a sum of Rs.5,57,330/- (Rs.5,49,947/- towards cost of the goods and Rs.7,383/- towards freight and forwarding charges) to the plaintiff. The plaintiff, however, is not entitled to sum of Rs.1,70,000/- towards warehouse charges w.e.f. 01/05/2019 till February 2022 @ 5,000/- per month) as nothing has been placed on record by the plaintiff from which warehouse charges, if any, CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 20 / 22 which plaintiff has paid or may be paying, can be ascertained. Thus in absence of any document put forth by plaintiff in this regard, plaintiff is not entitled to any sum of money towards warehouse charges.
ISSUE NO. 3Whether the plaintiff is entitled to interest. If so, at what rate and for which period? OPP
42. The plaintiff has claimed an amount of Rs.3,78,243/- towards interest on the cost of goods @ 24% per annum w.e.f. 19.04.2019 to 28.02.2022 together with pendente lite and future interest @ 24% per annum from the date of institution of suit till the realization of the amount. Although as per invoice Ex.PW1/7 and Ex.PW1/8, plaintiff was entitled to charge interest @ 24% per annum if payment was not received on due date, the interest claimed by plaintiff, however, appears to be on higher side. The interest of justice would be served if plaintiff is granted simple interest @12% per annum on the principal amount of Rs.5,49,947/- from 21.05.2019 when the plaintiff for the first time conveyed to defendant that the grid lacquered MG paper supplied by them to plaintiff has been rejected as it was not getting sealing with PVC blister film, till realization of the decretal amount.
R E L I E F:-
43. In view of the above, I hereby pass a money decree in the sum of Rs.5,57,330/- (Rupees Five Lakhs Fifty Seven Thousand Three Hundred Thirty only) in favour of the plaintiff CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 21 / 22 and against the defendant, with simple interest @ 12% per annum on the principal amount of Rs.5,49,947/- from 21.05.2019 till realization of the decretal amount.
The defendant will further pay the full costs of the suit and additionally Rs.1,000/- spent by the plaintiff in DLSA for invoking pre-institution mediation.
Decree sheet be prepared accordingly.
File be consigned to record room after due Digitally signed compliance.
ILLA by ILLA RAWAT Date:
Announced in the open Court RAWAT 2023.08.26 on 26th Day of August, 2023. 16:48:38 +0530 (ILLA RAWAT) District Judge Commercial Court-03 Central District, THC, Delhi.
CS (COMM) No.839/2022 Padam Chand Jain Vs. M/s Safepack Industries Limited Pg. 22 / 22