Delhi District Court
M/S Planet Advertising Pvt. Ltd vs M/S Ambience Pvt. Ltd. & Ors on 28 April, 2023
IN THE COURT OF DISTRICT JUDGE
(COMMERCIAL COURT-2)
SOUTH DISTRICT, SAKET COURTS: NEW DELHI
CS DJ 862/2018
M/s Planet Advertising Pvt. Ltd. ..... Plaintiff
Through Shri Sudhir Haryal
Having its registered office at
G-11, 2nd Floor, Hauz Khas Market,
New Delhi - 110016
Versus
1. M/s Ambience Pvt. Ltd. & Ors. ..... Defendant No. 1
Through its Managing Director
Shri Raj Singh Gehlot,
L-4, Green Park Extension,
New Delhi - 110016
2. Shri Ramesh Chander
Kapoor (Director) ..... Defendant No. 2
276, 1st Floor, L-4, Green Park Extension,
New Delhi - 110016
3. Shri Dayanand Singh (Director) ..... Defendant No. 3
276, 1st Floor, L-4, Green Park Extension,
New Delhi - 110016
4. Shri Brij Behari Tandon (Director) ..... Defendant No. 4
276, 1st Floor, L-4, Green Park Extension,
New Delhi - 110 016
Date of institution : 14.09.2018
Arguments concluded on : 25.04.2023
Date of judgment : 28.04.2023
Appearance
Sh. Kunal Kalra counsel for plaintiff.
Sh. Shiv Gupta with Sh. Khushal Singh counsels for defendants.
JUDGMENT
1. This is a suit for recovery of money.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 1 of 40Background Facts
2. Plaintiff is a company registered under the Companies Act, 1956 having its office at G-11, 2nd Floor, Hauz Khas Market, New Delhi and engaged in the business of providing services relating to display of advertisements of products.
2.1 Case of the plaintiff is that M/s Ambience Pvt ltd.- defendant no. 1 company registered under the Companies Act, 1956 as a Private Limited Company having office at L-4, Green Park Extension, New Delhi. D-2 to D-4 are the Directors of D-1 company. It is stated that D-2 to D-4 are responsible for the management and day to day operations of D-1 company. It is averred that in the month of April 2014, defendants company approached the plaintiff for displaying few outdoor advertisements at different sites of plaintiff for a period of 6 months which was extendable as per the requirement of the defendants company.
2.2 Defendants company placed a purchase order dated 10.06.2014, with the plaintiff to display their advertisements. Pursuant to the said purchase order, plaintiff kept defendants company updated with the campaign held in the month of June, 2014 by regularly sending them emails alongwith the complete set of photographs for each of the sites displayed. Thereafter, plaintiff raised their first invoice for the month of June, 2014 vide bill no. 187, dated 02.07.2014 amounting to Rs.18,73,667/-. Against the invoice, defendants issued a cheque for Rs.16,18,960/- but still balance of Rs.2,54,707/- is payable.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 2 of 402.3 It is averred that defendants company being satisfied with the work and impressed with successful running the campaign by the plaintiff issued another purchase order dated 16.07.2014 adding few more sites for display within Delhi NCR. The campaign continued and plaintiff continued sending invoices to the defendants company for the work completed between July, 2014 and December, 2014 concurrently getting an assurance that the bills would be cleared on time. It is averred that all the invoices were acknowledged by the officials of the defendants company, details of the invoices for the work done from July, 2014 to December, 2014 are as under :-
Ambience Pvt. Ltd.
S. No. Bill Particulars Date Amount (in Rs.)
1 305 22.08.2014 14,79,598/-
2 306 22.08.2014 3,50,000/-
3 370 20.09.2014 14,52,000/-
4 371 20.09.2014 9,75,000/-
5 417 30.09.2014 8,09,678/-
6 418 30.09.2014 3,83,333/-
7 438 11.10.2014 7,61,351/-
8 439 11.10.2014 6,64,797/-
9 480 07.11.2014 16,31,467/-
10 543 07.11.2014 16,31,467/-
TOTAL 1,01,38,691/-
2.4 It is further pleaded in the plaint that besides the
outstanding amount with respect to the aforementioned invoices, defendants company have not cleared the balance amount w.r.t. Rs.2,54,707/- pertaining to invoice no. 187 and as such total outstanding works out to be Rs.1,03,93,398/-. It is stated that upon successful completion of the campaign for 6 months and M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.( CS DJ 862/18) Page 3 of 40
submission of all the invoices duly accepted by defendants company, plaintiff approached defendants company several times personally as well as by way of telephonically & e-mails, in order to clear the outstanding amount of Rs.1,03,93,398/-. Despite the fact that entire work had been carried out to the satisfaction of the defendants company, it failed to adhere to the terms of the purchase orders and have not made the payment to the plaintiff despite reminders.
2.5 It is further the case of the plaintiff that Managing Director of the plaintiff sent number of messages (SMSs) to Shri Amit Gehlot of defendants, requesting him to release the outstanding payment. In reply to one of the SMSs sent on 17.11.2014 at 6.39 pm by plaintiff, Shri Gehlot assured the plaintiff "Haryal Saab, I am on the job. Will be taken care.
Don't worry. Relax", and finally on 22.12.2014, Ms. Ruchi Kapoor, one of the defendant's representatives responded to email sent by plaintiff on 22.12.2014 "Will let u know when the cheques are ready." It is stated that cheques are yet to be received but email dated 22.12.2014 of the defendants is a clear acceptance of the outstanding amount against the defendants and despite its admissions and assurances, defendants company failed to make the payment of the outstanding amount. 2.6 It is pleaded that inadvertently due to bonafide mistake the total outstanding amount has wrongly written as Rs.10,393,398/- in the email dated 22.12.2014. Thereafter, defendant no. 2 called plaintiff at its registered office for a meeting when he handed over to plaintiff back-dated purchase orders no. Ambeince/14-15/121 and Ambeince/14-15/225 with amendment dated 01.07.2014 and 01.08.2014. On query from M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 4 of 40the plaintiff as to why these back-dated purchase orders were prepared, it was informed that since there was a shortage of funds in the group company i.e. 'Ambience Pvt. Ltd.', therefore, he would request the plaintiff to issue fresh invoices in the name of 'Ambience Projects and Infrastructure Pvt. Ltd.' where the funds were available and assured that the payment will be released within two days of receipt of invoices in the name of 'Ambience Projects and Infrastructure Pvt. Ltd'. It is stated that plaintiff reluctantly agreed to his offer as he was in dire needs of funds if plaintiff pays within two days and plaintiff handed over the back dated purchase orders amounting to Rs.53,66,278/- in lieu of following invoices were prepared:
1 438 11.10.2014 7,61,351/-
2 439 11.10.2014 6,64,797/-
3 480 07.11.2014 16,31,467/-
4 543 07.11.2014 16,31,467/-
2.7 It is stated that defendant no. 2 induced plaintiff to raise back dated invoice and split the total outstanding amount in two parts i.e. Rs.45,11,305/- and Rs.53,66,278/- totaling Rs.98,77,583/- excluding service tax, instead of original outstanding of Rs.1,03,93,398/- including service tax and it was agreed that in case, defendants company failed to make the payment of the said back dated invoice for a sum of Rs.53,66,278/- then in that case defendants company shall be liable to make the payment of the original bills which included service tax to tune of Rs.5,15,815/- and total amount worked out to Rs.1,03,93,398/- (Rs.98,77,583/- plus Rs.5,15,815/-).
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 5 of 402.8 It is pleaded that as there had been inordinate delay in receipt of payments the plaintiff was left with no alternative but to agree to the requests in order to get its huge amounts released from defendants company, issued consolidated invoice for Rs.53,66,278/- (excluding service tax) in the name of 'Ambience Projects and Infrastructure Pvt. Ltd.' which was received by them on 10.01.2015 against back dated amended purchase orders.
2.9 It is stated that a sum of Rs.1,03,93,398/- inclusive of the service tax amount is payable towards the outstanding amount, which defendants company failed to pay as per the assurances and admission made by them and thus, plaintiff is entitled to receive the entire amount with interest @ 18% per annum from the defendants company. It is averred that plaintiff had been raising overdrafts from the banks to finance the defendant's campaign which is still outstanding on which huge interest liability is being incurred and this arrangement further affected the cash flow of the plaintiff company which was forced to issue legal notice dated 20.08.2015 u/S 433/434 and 439 of the Companies Act, 1956, calling upon defendants to pay a sum of Rs.1,03,93,398/- alongwith interest @ 18% per annum. It was further emphasized that if the same was not complied within 21 days from the date of receipt of the said legal notice, appropriate proceedings u/S 433, 434 and 439 of the Companies Act, 1956 shall be initiated. It is stated that reply to the notice was received by counsel for plaintiff on 12.09.2015 wherein defendants concocted false stories and raised frivolous, misleading allegation which are untenable and contrary to their own admissions.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 6 of 402.10 It is pleaded that plaintiff had also filed a petition u/S 433(e) and 434 of Companies Act, 1956 (Section 271(I) and 271(II) of Companies Act, 2013) before Hon'ble Delhi High Court, which was pleased to admit the petition the plaintiff on 04.08.2018 and deferred appointing the OL as the PL till next date of hearing. In the meanwhile, respondent was given liberty to deposit a sum of Rs.53,66,278/- within four weeks and if such amount is deposited, plaintiff was free to have the said amount released. In that eventuality, order admitting the petition stood revoked and petition was disposed of. It was observed that petitioner would be free to approach civil court by way of appropriate civil proceeding to claim further amount that it seeks. In case, such civil proceedings are commenced, nothing stated therein would bind the parties to findings recorded therein. It is stated that defendants company did not comply with the order passed by the Court within four weeks for which plaintiff was left with no option but to file the present suit for recovery of Rs.1,03,93,398/- along with interest. 2.11 It is pleaded that since defendants wrongfully withheld an amount of Rs.1,03,93,398/- out of which Hon'ble Delhi High Court held Rs.53,66,278/- as admitted liability of the defendants company and admitted the winding up proceeding, but defendants company had not deposited the admitted amount and hence Rs.1,03,93,398/- alongwith interest was recoverable by the plaintiff from the defendants on the date of filing of suit. It is stated that Hon'ble High Court granted liberty to plaintiff to approach the civil court and hence plaintiff has filed the present suit.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 7 of 403. Defendants were served with the summons on 01.02.2019. On 20.03.2019, Ms. Runasree Buragohain, counsel for defendants appeared and filed vakalatnama for D-1 and memo of appearance for other defendants. On 10.07.2019, another counsel, Ms. Mallika Kamal appeared and filed vakalatnama on behalf of D-1 and stated that she was also appearing for defendant nos. 2 and 3 and then filed vakalatnama on 31.07.2019 on behalf of defendant no. 2 and 3. She filed written statement on behalf of the defendants but without any application seeking condonation of delay in filing written statement and since written statement was filed beyond the period of 120 days, defence of defendants was ordered to be struck of vide order dated 10.07.2019 by the Ld. Predecessor of this court.
3.1 On 20.02.2020, this Court referred the matter to the Mediation Center for exploring the possibility of settlement. On 19.02.2021, Ld. Counsels for the parties informed the Court that no settlement could be arrived at between the parties during mediation proceedings. Applications filed by the defendants, u/S 114 r/w Order 47 r/w Section 151 CPC and u/O VII Rule 11 r/w Section 151 CPC were disposed of and case management hearing was held.
4. On behalf of plaintiff, Shri Sudhir Haryal (PW-1) was examined. Despite giving opportunity, no cross-examination had been conducted and accordingly, PE was closed by the Ld. counsel for the plaintiff. On 26.03.2021, Ld. counsel for the plaintiff submitted that defendants had filed an appeal, FAO (comm) 81/2020 impugning the order dated 19.02.2021. On 04.08.2021, Shri Vipul Agrawal, counsel for IRP appeared and e- M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 8 of 40filed an application u/S 151 CPC alongwith his vakalatnama and order dated 21.12.2020 passed by the National Company Law Tribunal, Bench-III. On 27.08.2021, Shri Vipul Agrawal, Ld. counsel for IRP made statement that, vide order dated 21.12.2020 by NCLT in the matter of Vistra ITCL (India) Ltd. Vs. Ambience Pvt. Ltd., CIRP has been initiated against Ambience Pvt. Ltd. in which Shri Sandeep Chandna has been appointed as the IRP and accordingly, upon his instructions, an application was filed in this case to take on record the order dated 21.12.2020. In view of the moratorium imposed vide the said order, proceedings of the present matter was adjourned sine-die and liberty was granted to plaintiff to revive the suit, if required/permissible under law.
5. On 07.09.2022, Ld. counsels for the parties appeared and apprised the court about the order dated 04.08.2022 of Hon'ble Delhi High Court, whereby defendants were granted ten days time to file written statement, schedule of date of the proceedings was fixed and costs of Rs. One Lakh was imposed upon the defendants for the delay. Ld. counsels for the parties submitted that moratorium u/S 14 of IBC is no longer in operation and IRP role has come to an end in view of order passed by the NCLAT dated 02.08.2022 in CA(AT) 06/2021. Ld. counsel for D-1 and D-3 further submitted that e-copy of written statement had been filed on 13.08.2022 alongwith statement of admission/denial of documents and documents and hard copy thereof had been filed on record on 21.08.2022. As per the plaint and memo of parties, D-2 & D-4 are the directors of D-1 company.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 9 of 40Written Statement
6. Defendant nos. 1 and 3 contested the suit by filing written statement through authorized representative-Sh. Amit Gehlot. Defendant no. 1 and 3 denied the allegations and stated that plaintiff concealed material facts from this Court and suit is bad for mis-joinder and non-joinder of parties and is liable to be dismissed on account of multifariousness. It is stated that no relief against defendant no. 2 to 4 could be claimed as the plaintiff had no privity of contract with D-2 to D-4 and the alleged liability was neither express nor an implied liability against D-2 to D-4. It is stated that directors have no personal liability on behalf of the company and D-2 and D-4 resigned as directors of D-1 company on 26.08.2019 and 07.07.2019 respectively. It is stated that the alleged invoices on the basis of which present suit has been filed by the plaintiff ranged during the period between 02.07.2014 till 07.11.2014, and admittedly, present suit had been filed on 13/14.09.2018 which was beyond limitation. It is stated that the suit is also liable to be dismissed as plaintiff was deficient in providing services to the defendants company and had no cause action to file and maintain the present suit.
6.1 It is stated that present suit is not maintainable as plaintiff had already withdrawn Rs.53,66,278/- deposited by the defendants before Hon'ble High Court of Delhi in Co. Petition No. 812/2015 filed by plaintiff against the defendants for winding up D-1 company in terms of order dated 28.09.2018, and the failure of the plaintiff to bring on record this material fact disentitles the plaintiff to seek any relief from this court. It is denied that Shri Sudhir Haryal, Chief Executive Officer of M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 10 of 40plaintiff company is authorized to file the present suit. Defendants also denied the resolution dated 11.09.2018. It is stated that plaintiff had approached the defendants for outdoor advertising campaign and submitted its quotations for the said purpose and D-1 placed orders for the outdoor advertisement campaign. Defendants admitted that they placed purchase order no. Ambeince/14-15/121 dated 10.06.2014 with the plaintiff to display their advertisement.
6.2 Defendants admitted that defendants issued another purchase order dated 16.07.2014 bearing No. Ambeince/14- 15/225. It is denied that plaintiff from the very beginning carried out the work to the utmost satisfaction of defendants company and the campaign continued. It is submitted that work done by the plaintiff was not as per the satisfaction of the defendants and plaintiff never completed the work as per agreed terms and these invoices drawn by the plaintiff were never submitted to the defendants company and the same were never accepted by defendants company and no amount is payable by the defendants as the plaintiff failed to provide the service as per the agreement. It is stated that the printing and mounting of flexes were not on sun board sheets and was not with high quality ink as agreed. 6.3 It is stated that plaintiff never rectified the electrical problem of damaged/non-working Halogen bulbs and of fuse in time, and additionally, plaintiff failed to provide bright lights as per satisfaction of the defendants for the hoardings. It is stated that the alleged outstanding amount of Rs.1,03,93,398/- is without any basis and that despite repeated requests by the defendants company, plaintiff failed to provide the regular updates and photographs as per agreement to the defendants. M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 11 of 406.4 Defendants denied other averments . It is stated that plaintiff was repeatedly reminded via email that services rendered by them were deficient, yet no steps were taken by the plaintiff to correct the deficiencies. It is stated that since no back dated purchase orders were signed in the alleged manner, question of plaintiff enquiring about issuing the same does not arise. Defendant denied that plaintiff issued a consolidated invoice for Rs.53,66,278/- in the name of Ambience Project & Infra Pvt. Ltd. and that alleged bill was received by defendants on 10.01.2015.
6.5 Defendants denied that sum of Rs.1,03,93,398/- was payable by defendant company or they were liable to make payment of Rs.1,03,93,398/-. It is denied that plaintiff is entitled to receive the amount with interest @ 18% per annum from the defendant company. Defendants denied the contents of legal notice dated 20.08.2015. It is also denied that plaintiff is entitled for the said sum alongwith interest @ 18% per annum from the date of last day of display invoice dated 07.11.2014 till realization of the said amount. It is stated that all the alleged invoices which ranged between 02.07.2014 till 07.11.2014, are beyond limitation and the present suit filed on the basis of the said invoices is time barred.
6.6 It is stated that defendants had complied with the order of the Hon'ble Delhi High Court and had deposited Rs.53,66,278/- vide demand draft no. 61627 dated 03.09.2018 and plaintiff had withdrawn the said amount but failed to bring on record this fact, which dis-entitles it to seek any relief from this court and amounts to concealment and playing fraud on this court. It is submitted that order of the High Court did not extend M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 12 of 40the period of limitation in any manner whatsoever and plaintiff have no cause of action whatsoever to file and maintain the suit. It is prayed that the suit may be dismissed with costs. Rejoinder
7. In rejoinder, plaintiff denied the allegations made by the defendants and reiterated its version as claimed in the suit. In the preliminary objections, it is pleaded that defendant had failed to comply with the order dated 03.08.2018 passed by Hon'ble Delhi High Court wherein defendants were directed to deposit Rs. 53,66,278/- within the period of four weeks from the said date. It is stated that defendant filed an application for condonation of delay in depositing the admitted amount and the said application was listed before the Court on 17.09.2018 and the Hon'ble High court was pleased to condone the delay in depositing the amount. It is pleaded that the suit of the plaintiff was filed on 12.09.2018 i.e. much prior to the filing of the application for condonation of delay, therefore the allegations of defendants are falsified on the face of it . It is further pleaded that plaintiff filed an application for releasing the amount deposited and the said application was allowed on 28.0-9.2018. it is stated that balance amount was also admitted by the defendant company as the defendant company had deducted the TDS of the invoices raised by the plaintiff and that the defendant company had not deducted the TDS of the bill number 306 dated 16.07.2014 for a sum of Rs. 3,50,000/-.
7.1 Plaintiff further pleaded that the plaintiff raised the bills as per the chart and the total outstanding for three months is Rs. 44,00,685/- (Rs. 45,10,629 including TDS) till 14.09.2014 and the same was due till date. It is stated that the plaintiff was M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 13 of 40regularly following with the defendant for the outstanding as per the terms and conditions of the work order but the defendant was delaying in payment. It is stated that the TDS were deducted by the defendant as shown in 26AS and the defendant did not deducted TDS arbitrarily on bill no. 306 amounting to Rs. 3,50,000/- but had never refuted the said bill. It is pleaded that the defendant was satisfied with service of the plaintiff and the plaintiff agreed and continued the campaign as per the direction of the defendant. It is pleaded that the bills were raised accordingly from 15.09.2014 to 14.12.2014 amounting to Rs. 53,66,278/- and the same were paid to the plaintiff on the direction of the High Court.
Issues
8. From the pleadings of the parties, following issues were framed:
1. Whether plaintiff is entitled to recovery of the principal amount of Rs.1,03,93,398/-? OPP
2. Whether the suit is within limitation? OPP
3. Whether plaintiff is entitled to interest @ 18% per annum? If so, from which date?
4. Relief.
Witnesses examined and documents produced
9. Plaintiff examined PW-1 Sh. Sudhir Haryal who placed on record Board Resolution dated 11.09.2018 Ex.PW-1/1; purchase order dated 10.06.2014 issued by the defendant company through Sh. R. Subramanium, Vice President (Project), acknowledged by our employee, Sh. Varun on plaintiff's behalf Ex.PW-1/2; Print out email dated 12.06.2014 at 12:45pm sent by M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 14 of 40defendant to plaintiff is Ex. PW1/2A; invoice no. 187 dated 10.06.2014 executed by plaintiff's employee, Sh. Dhananjay having acknowledgment on behalf of defendant is already Ex.PW-1/3; purchase order dated 16.07.2014 issued by the defendant company through Sh. R. Subramanium, Vice President (Project) Ex.PW-1/4; Print out email dated 14.06.2016 at 11:58am sent by plaintiff to defendant Ex. PW1/4A; invoice nos. 305 dated 22.08.2014; 306 dated 22.08.2014; 370 dated 20.09.2014, 371 dated 20.09.2014; 417 dated 30.09.2014, 418 dated 30.09.2014, 438 dated 11.10.2014, 439 dated 11.10.2014, 480 dated 07.11.2014 and 543 dated 07.11.2014, executed by plaintiff's employee, Sh. Dhananjay having acknowledgment on behalf of defendant Ex.PW-1/5 to Ex.PW-1/14; Printout of e- mails from 10.11.2014 to 22.12.2014 sent by the plaintiff company to defendants requesting for payments Ex.PW-1/15; printouts of SMS dated 17.11.2014; 19.11.2014 and 20.102.104 sent by PW-1 and replied by Sh. Amit Gehlot on behalf of the defendants Ex.PW-1/16; e-mail dated 22.12.2014 at 06:26 pm sent by Ms. Ruchi Kapoor on behalf of defendant company to plaintiff Ex.PW-1/17; copy of legal notice dated 22.08.2015 issued by Shri Kunal Kalra, advocate for plaintiff to defendant company Ex.PW-1/18; postal receipt Ex.PW-1/19; Printout of internet copy of tracking report Ex.PW-1/20; e-mail dated 22.12.2014 issued by defendant to plaintiff Ex.PW-1/21; copy of reply to the legal notice sent by counsel for defendant to counsel for plaintiff Ex.PW-1/22; Internet order dated 03.08.2018, passed by Hon'ble Delhi High Court in Company Petition No. 812/2015 Ex.PW-1/23; Copies of Order dated 17.09.2018 and 28.09.2018, passed by Hon'ble Delhi High Court in Company Petition No. M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 15 of 40812/2015 titled Planet Advertising Pvt. Ltd. Vs. Ambience Pvt. Ltd. Ex.PW-1/24 and Ex.PW-1/25; TDS certificates (dated 01.10.2015, 03.02.2015 and 20.01.2015) are Ex.PW-1/26A to Ex. PW1/26C; email dated 22.12.2014 at 06:24 pm sent by plaintiff company to the defendant Ex. PW1/27 and email dated 22.12.2014 at 03:39pm sent by defendant to plaintiff company Ex. PW1/27 A and email dated 22.12.2014 at 06:26pm sent by defendant company to plaintiff Ex. PW1/17; Certificate U/s 65-B of Indian Evidence Act Ex.PW-1/28.
9.1 Sh. Amit Gehlot DW- 1 placed on record Board Resolution dated 26.03.2019 executed by Managing Director Ex. DW1/1; email communication dated 31.07.2014 at 11:22am sent by defendant to plaintiff Ex. DW1/2; email communication dated 06.08.2014 at 07:29pm sent by defendant to plaintiff Ex. DW1/3; email communication dated 17.09.2014 at 03:39pm sent by defendant to plaintiff Ex. DW1/4; email communication dated 22.12.2014 at 12:15pm sent by defendant to plaintiff Ex. DW1/5.
10. This Court has heard submissions advanced by Shri Kunal Kalra Ld. counsel for plaintiff and Shri Shiv Gupta alongwith Sh. Khushal Singh, Ld. counsels for defendant no. 1 & 3 and perused the material on record. Issue-wise findings of this court are as under :-
ISSUE NO. 2Whether the suit is within limitation? OPP
11. This issue no. 2 pertaining to the limitation is taken up first. Onus to prove this issue is on the plaintiff. The plantiff's version is that since the suit is within limitation, therefore, plaintiff has not made any averment in the plaint seeking condonation of delay.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 16 of 4012. The assertion made by the plaintiff in the plaint was that in September, 2018 total amount payable by the defendants was Rs.1,61,49,347/-, which included interest @ 18% out of which the principal amount is Rs.1,03,93,398 and remaining was the interest i.e. Rs.57,55,949/- w.e.f 15.08.2014 till date of filing of the suit. In the winding up petition (Co. Pet. 812/2015) filed by the plaintiff, vide order dated 03.08.2018, Hon'ble High Court had while admitting the petition ordered that in the meantime, the defendants may deposit the amount of Rs.53,66,278/- within four weeks and in that eventuality, order admitting petition shall stand revoked and further petitioner would be free to approach civil Court by way of appropriate civil proceedings to claim any further amount that it seeks. Defendants had not deposited the amount within four weeks. This suit had been filed on 14.09.2018, before the said amount had been deposited by the defendants. Vide order dated 17.09.2018, delay of five days in depositing the amount of Rs. 53,66,278/ with the Registrar General was condoned.
13. Sh. Kunal Kalra, Ld. counsel for the plaintiff submits that present suit is within the limitation as the plaintiff had immediately filed the suit pursuant to the liberty granted by the Hon'ble High Court of Delhi to the plaintiff to initiate appropriate civil proceedings to claim any further amount which was reiterated by Hon'ble High Court of Delhi while condoning the delay in depositing the amount by the defendants. It is submitted that defendants company had not raised any objection regarding limitation before the Hon'ble High Court of Delhi, therefore, now the defendants cannot raise any such plea M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 17 of 40belatedly. It is further submitted that defendants company has acknowledged their liability vide its email and had also deducted the applicable TDS on 24.09.2015, therefore, defendants are stopped by law of estoppal to raise any such plea of limitation.
14. It is submitted that defendants deposited TDS amount on Rs.16,52,000/- towards bill no. 187 (Ex.PW1/3 in the sum of Rs.18,73,667/-) amount on Rs.14,52,000/- towards bill no. 305 and on the amount of Rs.24,27,000/- towards bill no. 370 & 371. It is pointed out that Bill No. 305 is in the sum of Rs.14,79,598/- and defendants had not paid TDS of Rs.27,598/- towards display of mounted/printed flex as mentioned in the invoice at Sr. No. 4 and after the deduction of said amount, the balance amount would be Rs.14,52,000/-. Submissions of the plaintiff is that since the TDS of Rs.48,540/- was deposited by the defendants on 24.09.2015, the period of limitation is extended for a further period of 3 years from 24.09.2015 and therefore, the suit filed on 14.09.2018 is within limitation.
15. On the other hand, Sh. Shiv Gupta, Ld. counsel appearing for the defendants submitted that present suit is filed by the plaintiff for recovery of the money due against the Invoices raised by the Plaintiff for the services provided and thus, case of the Plaintiff would be covered by Article 15 of the Limitation Act and the limitation period of 3 years to be computed from the last day when the period of credit expires if the goods are read in synonymous with services and that in the alternative, case of the Plaintiff would fall under Section 113 Limitation Act and thereby the limitation period is 3 years to be computed from the date when the right to sue accrues..
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 18 of 4016. Ld. counsel for the defendants argued that the said averment as regards TDS has not been taken by the plaintiff in the Plaint and cannot be looked into in view of the provision Order VI Rule 15A (4) CPC as amended by the Commercial Courts Act and as per Black's Law Dictionary, "Pleadings" is defined as "The formal allegations by the parties to a lawsuit of their respective claims and defenses, with the intended purpose being to provide notice of what is to be expected at trial." and that in the absence of pleading, evidence, if any, produced by the parties cannot be considered and no party should be permitted to travel beyond its pleading and that all necessary and material facts are pleaded by the party in support of the case set up by it.
17. This suit was filed on 14.09.2018. Defendants placed purchase orders dated 10.06.2014 and 16.07.2014 respectively for the work of displaying their advertisement. Plaintiff raised invoices during the period between July 2014 to December 2014. Case of the plaintiff is that defendants had not cleared the outstanding balance amount of Rs. 10,393,398/- and that cause of action arose further when Ms. Ruchi Kapoor , representative of the defendants sent an email dated 22.12.2014 stating that they will let the plaintiff know when the cheques are ready. It is further asserted that cause of action arose when legal notice dated 20.08.2015 was sent by the plaintiff and on 04.08.2018 when Hon'ble High Court admitted the petition of the plaintiff and thereafter, in the replication, plaintiff pleaded regarding the acknowledgement of the liability by the defendants, when they deposited the TDS.
18. It may be noted that Order VI Rule 15A CPC as amended by the Commercial Courts Act speaks about the M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 19 of 40pleading which are not verified in the manner provided under Sub-Rule (1) and as per the Appendix-1/statement of truth to the schedule. There is no dispute that the pleadings are the outer boundaries of a case of a party and the evidence cannot be adduced beyond pleading. The pleadings comprise not only of the plaint or written statement but also replication when permitted to be filed by the Court. The purpose of pleading is to enable the adversary party to know the case it has to meet and in order to have a fair trial, it is imperative that the party should state the essential material facts so that other party may not be taken by surprise.
19. Vide order dated 04.08.2022 when defendants were permitted to file written statement, plaintiff was also permitted to file replication which had been filed by the plaintiff in the present case. Defendants have lost sight of the fact that in the replication (referred as 'rejoinder') in para 10 of preliminary objection, plaintiff has specifically pleaded about the fact that the balance amount was admitted by the defendants company as it deducted the TDS w.r.t the invoices raised by the plaintiff. It was submitted that defendants had not deducted TDS of the bill no. 306 dated 16.07.2014 for a sum of Rs.3,50,000/- and the copy of TDS certificate is on record. Plaintiff has further given detail about deduction of TDS in para 5 thereof. PW-1 during cross- examination deposed that after raising the bill, there were two items which were supposed to be paid in 30 days and two items which were supposed to be paid in 90 days and the said fact is mentioned in the purchase order.
20. It is urged that although the plaintiff has not speculated any items to be paid within 30 days or 90 days from M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 20 of 40the date of the respective invoices in the plaint, but in the evidence by way of affidavit the plaintiff has stated in para 27 that the total outstanding is Rs.44,00,685/- which pertains to Invoices dated 02.07.2014 (Bill No. 187), 22.08.2014 (Bill No.
305), 20.09.2014 (Bill No. 370), 22.08.2014 (Bill No. 306) and 20.09.2014 (Bill No. 371). Since the plaintiff has not filed the present suit on the basis of accounts and limitation has to be seen with respect to individual invoices as per Article 113 of the Limitation Act, the suit filed by the plaintiff is beyond limitation.
21. As per Ex.PW1/26A, defendants had shown the amount of Rs.24,27,000/- on which the tax of Rs.48,540/- has been deposited on 24.09.2015 and certificate was generated on 01.10.2015. Sh. Shiv Gupta Ld. Counsel argued that Hon'ble High Court has explicitly not extended the period of limitation and the payment of TDS will not extend the same. It is submitted that the amount of Rs.24,27,000/- mentioned in the certificate Ex.PW1/26A has not been paid by the defendants to plaintiff and the TDS has been deposited with the Income Tax Authority and not paid to the plaintiff. It is submitted that liberty granted by the High Court vide order dated 03.08.2018 and 17.09.2018 will not extend the period of limitation for filing of the civil suit. Plaintiff has not pleaded in the plaint that its suit is time barred or vide order of the High Court, the period is extended.
22. It is not the case of the plaintiff that their suit is time barred, rather the case of the plaintiff is that suit is within limitation, since, plaintiff is relying upon email dated 24.12.2014 and deposit of TDS by the defendants whereby defendants acknowledged the liability. Ld. Counsel for plaintiff argued that M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 21 of 40defendants deposited the TDS on 30.09.2014; 07.01.2015 and 24.09.2015 and as per Form 16 A, defendants themselves had shown the plaintiff as creditors and defendants deducted tax showing their liability with regard to invoices in question and name of the defendants has been shown as deductor. TDS has been paid in a fixed sum and note the estimated sum.
23. S.P. Brothers vs. Biren Ramesh Kadakia1 was referred in support of his submissions that payment of TDS by the defendants does not amount to acknowledgement or acceptance of the liability. In 'S.P. Brothers case (supra) Bombay High Court observed as under :
"8. ... The issuance of TDS certificates does not amount to an acknowledgement of defendant within the meaning of Section 25 of the Indian Evidence Act and the Full Bench judgment of this Court in the case of Jyotsna (supra) puts the matter beyond doubt. The TDS certificate is primarily to acknowledge the deduction of tax at source. The certificate does not refer to any amount of loan or even the rate of interest which is payable on the said principal amount. It does not refer to any contract between the parties and even a transaction. ..."
24. In Shree Associates vs. Gammon India Limited2 it was observed as under :
"11. ...The argument advanced on behalf of the Petitioner that the period of limitation would get extended till the Petitioner gained knowledge of the fact that the Company had on 7 September 2010 deposited TDS on the said amount of Rs. 24,75,170/- is prima facie unacceptable."
25. Ld. counsel for the defendants also relied upon Sunil Kumar Maity vs. State Bank of India & Ors. 3 wherein the Hon'ble Supreme Court observed:
1 2008 SCC Online Bom 1559 2 2015 SCC Online Bom 2223 Bombay High Court 3 AIR 2022 SC 577 M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.( CS DJ 862/18) Page 22 of 40
"The National Commission therefore has grossly erred in observing in the impugned order that the Appellant- complainant would be at liberty to seek remedy in the competent Civil Court and that if he chooses to bring an action in a Civil Court, he is free to file an application Under Section 5 of the Limitation Act, 1963, recording the statement of Ld. Counsel for the SBI that it will not press the issue of limitation if action is brought by the complainant in a Civil Court. Such an observation/order passed by the National Commission is in utter ignorance of the provisions of the Limitation Act, in as much as Section 5 of the Limitation Act does not apply to the institution of civil suit in the Civil Court. Be that as it may, the impugned order passed by the National Commission solely relying upon the suo-moto report called for from the Respondent- bank during the pendency of the revision application, being highly erroneous, deserves to be set aside and is accordingly set aside. The order passed by the State Commission is restored. The appeal stands allowed accordingly."
26. This Court finds no merit in the contention of the plaintiff that since the TDS of Rs.48,540/- was deposited by the defendants on 24.09.2015, the period of limitation is extended for a further period of 3 years from 24.09.2015. TDS Certificate is primarily to acknowledge deduction of tax at source and does not amount to an acknowledgement of debt, or admission of liability. The deposit of TDS amount by the deductor does not indicate the acknowledgment of liability by the deductee towards the TDS amount. The deposit of TDS amount is only a statutory obligation cast on the deductor, and it does not imply any acknowledgment of liability by the deductee. Therefore, the deposit of TDS amount by the deductor cannot be considered as an acknowledgment of liability under Section 18 of the Limitation Act by the deductee/defendant.
27. Section 18 of the Limitation Act which speaks of the effect of acknowledgment in writing reads as follows:
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.( CS DJ 862/18) Page 23 of 40
18. Effect of acknowledgment in writing.
(1) Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he de rives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
(2) Where the writing containing the acknowledgment is undated oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act , 1872 (1 of 1872), oral evidence of its contents shall not be received.
Explanation. For the purposes of this section.
(a) an acknowledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come or is accompanied by refusal to pay, Contd....P..4 of 8 deliver, perform or permit to enjoy, or is coupled with a claim to set off, or is addressed to a person other than a person entitled to the property or right,
(b) the word 'signed' means signed either personally or by an agent duly authorized in this behalf, and
(c) an application for the execution of a decree or order shall not be deemed to be an application in respect of any property or right.
28. From a perusal of Subsection (1) of Section 18, it is evident that to invoke this provision :
(1) there must be an acknowledgment of liability in respect of property or right;
(2) the acknowledgment must be in writing signed by the party against whom such right or property is claimed (or by any person) through whom he derives his title or liability;
(3) the acknowledgment must be made before the expiration of the period pre scribed for a suit or application (other than application for the execution of a decree) in respect of such property or right.
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 24 of 4029. In Khan Bahadur Shapoor vs Durga Prosad Chamaria and others4 Hon'ble Apex Court held that the documents on which a plea of acknowledgment is based must relate to a present subsisting liability though the exact nature or the specific character of the said liability might not be indicated in words; if words used in the acknowledgment indicated the existence of jural relationship between the parties, such as that of debtor or creditor and the statement was made with the express intention to admit such jural relationship of if such intention could be inferred by implication from the nature of the admission, the acknowledgment of liability would follow.
30. The effect of such an acknowledgment is that a fresh period of limitation has to be computed from the time when the acknowledgment was so signed. The question is whether deposit of TDS by defendants amount to acknowledgment in the sense that plaintiff will be entitled to a fresh period of limitation from date of deposit of TDS on 30.09.2014; 07.01.2015 and 24.09.2015?
31. This Court is of the view that deposit of TDS can prima facie be proof only of the tax deducted at source and not of the amount due to the plaintiff more so, what is the amount mentioned therein has not been shown or stated by the plaintiff as due to him. This is because no intention to acknowledge a liability can be inferred from the contents of TDS Certificates. In view of aforementioned reasons and law laid down in judgments 4AIR 1961 SC 1236 M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 25 of 40referred herein before, the deposit of TDS are neither the evidence of the debt or liability of the defendants nor can be relied upon to amount to an acknowledgment so as to get the benefit of Section 18 of Limitation Act and therefore, the suit of the plaintiff has to be held as barred by limitation.
32. Ld. Counsel for the plaintiff referred a case reported as Jilajeet vs Panch Lal and ors5 decided on 23.05.2023 by the Allahabad High Court to argue that the effect of the order whereby liberty is granted to the plaintiff to approach the civil Court would be to allow the plaintiff to file the suit beyond the period of limitation. Ld. counsel for defendants submitted that judgment Jilajeet vs Panch Lal and ors (supra) referred by plaintiff is not applicable to the present facts as the said case relates to election petition and does not deal with suit. This Court is in agreement with the submissions advanced by ld. Counsel for the defendants that the order in Jilajeet's case was passed in its peculiar facts and would not apply to the present factual matrix in a money suit. It was observed in Jilajeet's case (supra) that the cause of action should be treated to have arisen after the order of the election officer in his favour was held by the High Court in writ petition to have been passed by an authority which had become functuous officio and the order of the High Court in such situation be treated as announcement of the result and thus, provide a fresh starting point of limitation.
33. As per article 15 of the Limitation Act referrred by counsel for the defendants, the period of limitation is 3 years from the date when the period of credit expires in case of price 5 MANU/UP/1855/2003 M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 26 of 40of goods sold and delivered to be paid for or after the expiry of a fixed period of credit is the description of the suit. As per article 18, the period of limitation is 3 years from the date of work done, when the suit is filed for the price of work done by the plaintiff for the defendants at his request where no time has been fixed for the payment. When in any suit for which no period of limitation is provided elsewhere in the scehdule r/w Section 2
(j) & 3 of the Limitation Act, the period of limitation is three years from the date when the right to sue accrues. Section 3 of the Limitation Act clearly says that subject to provisions of Section 4 to 24 (inclusive), every suit instituted, after the prescribed period shall be dismissed. Section 14 of the Limitation Act will also not come into play in the present case as neither it has been pleaded nor any application was filed by the plaintiff and it is not a case when a party is pursing the remedy before the forum not having the jurisdiction.
34. Indisputably, the present suit was filed on 14.09.2018. Plaintiff's version is that in a petition (Co. Pet. 812/2015) seeking to wind up the defendant's company, the plaintiff had been granted liberty by the Hon'ble High Court vide orders dated 04.08.2018 and 17.09.2018 to approach the civil court by way of appropriate civil proceedings to claim any further amount that it seeks. Liberty granted by the Court has not the effect of extending the period of limitation for filing the suit.
35. In the context, it is also pertinent to note what Order XXIII Rule 2 CPC says. Order XXIII rule 2 CPC states that Limitation Law is not affected by fresh suit and in any fresh suit instituted on permission granted under the last M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 27 of 40preceding rule, the plaintiff shall be bound by the law of limitation in the same manner as if the first suit had not been instituted. It was held in Ajay Gupta vs. Raju6 that grant of liberty by High court cannot be effected by extending/enlarging the period of limitation as prescribed under the Limitation Act. In Ajay Gupta vs. Raju (supra) , the Hon'ble Supreme Court held :
"Section 5 of the Act which deals with "Extension of prescribed period in certain cases", applies only to appeals or applications and not to suits. Therefore, no court or tribunal can extend the period of limitation for filing a suit. Even if any cause, beyond the control of the plaintiff is shown also, the only extension is what is permitted under Section 4 of the Act, the period coming under court holiday."(emphasis added)
36. To sum up, the Court is of the considered view neither deposit of TDS by the defendants nor mere grant of liberty to the plaintiff to approach the Civil Court will extend the period of limitation and therefore, this suit having been filed after three years of the work done as well as from the date when the right to sue accrued to the plaintiff is barred by limitation and therefore, deserves to be dismissed in view of Section 3 of Limitation Act. In the result, this issue no. 2 is decided in favour of defendants and against the plaintiff.
ISSUE NO. 1Whether plaintiff is entitled to recovery of the principal amount of Rs.1,03,93,398/-? OPP
37. In the present case, question of limitation was not treated as preliminary issue but being a mixed question of fact 6 AIR 2016 SC 3284 M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 28 of 40and law is decided alongwith other issues. Notwithstanding the fact that this suit may be disposed of in view of finding on the issue no. 2 only but having regard to the provisions under Order XIV Rule 2 CPC, the findings on all the issues is being given.
38. Admittedly, defendants had deposited an amount of Rs.53,66,278/- pursuant to the order of High Court dated 17.09.2014 after filing of the present suit. Case of the plaintiff is that the said amount had been paid by the defendants pertaining to bills/invoice no. 417, 418, 438, 439, 480 and 543 and now, balance principal amount of remaining six invoices is Rs.53,66,278/- apart from service tax of Rs.5,15,815/- on the amount for six bills paid by the defendants pursuant to the High Court order. Ld. Counsel for plaintiff pointed out that the claim of the plaintiff now left to be decided is with respect to the balance principal amount of bills/invoices no. 187, 305, 306, 370 & 371 payable by the defendants as described in para 5 and 7 of the plaint in total amounting to Rs.45,11,305/- apart from Rs. 1,10,000/- to be deducted by the defendants.
39. Ld. counsel appearing for defendants submitted that the onus to prove this issue is on the plaintiff and plaintiff has to stand on his own legs and it can't take advantage of the weakness in the case of the defendants and that plaintiff has failed to prove on record the invoices Ex.PW-1/3, Ex.PW-1/5 to Ex.PW-1/14. It is submitted that plaintiff has filed the suit claiming the principal amount of Rs.1,03,93,398/- but during the cross-examination, plaintiff has claimed the outstanding amount of Rs.44,00,685/- and there being no specified value in the suit, the plaintiff is not entitled to claim any amount. It is settled position that Court can M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 29 of 40take into account the subsequent developments and always mould the relief.
40. Next, it is submitted that certificate u/S 65B is also unreliable and is not in accordance with law and is not admissible. It is submitted that it has been held by Hon'ble Supreme Court in case of 'Arjun Panditrao Khotkar Vs. Kailash Khushanrao & Ors." decided on 14th of July 2020 that the certificate u/S 65-B is mandatory for the production of electronic evidence before the court. It is urged that in the certificate U/s 65-B following conditions must be satisfied that (i) there must be a certificate which identifies the electronic record containing the statement; (ii) The certificate must describe the manner in which the electronic record was produced; (iii) The certificate must furnish the particulars of the device involved in the production of that record; (iv) The certificate must deal with the applicable conditions mentioned under Section 65B(2) of the Evidence Act; and (v) The certificate must be signed by a person occupying a responsible official position in relation to the operation of the relevant device.
41. It is argued that these measures are taken by the court to ensure the source and authenticity of the electronic record, which can be easily tampered, altered with, hence, these safeguards prove to be very significant to ensure justice especially in the cases where the conclusion of the trial is based on the electronic records. It is submitted that plaintiff in Ex.PW- 1/28 neither stated that which of the printouts were contained in which electronic device and/or when such print outs were taken M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 30 of 40and, t-herefore, Ex.PW-1/28 is not admissible in evidence and the suit of plaintiff may be dismissed on these grounds.
42. Lastly, it is argued that no amount is payable by the defendants as the plaintiff has failed to provide the service as per the agreed terms. It is urged that the printing and mounting of flexes were not on sun board sheets and was not with high quality ink as agreed. It is argued that plaintiff never rectified the electrical problem of damaged/non-working Halogen bulbs and of fuse in time and additionally, the plaintiff failed to provide bright lights as per satisfaction of the defendants for the hoardings.
43. The exchange of communication between the parties through email and the SMS proved on record establishes that plaintiff had informed regarding outstanding amount of Rs.10,393,398/- to the defendants who had replied stating that once the cheques were ready, intimation would be sent. The contention of defendants regarding the defect in the work or not completing the work has not been established. It has not been established by the defendants that plaintiff had failed to adhere to the terms and conditions of the orders. DW-1 examined in the cross-examination that no rental deduction could be made due to power cut and electricity as per clause no. 8 of the terms and conditions of the purchase orders Ex. PW1/3 and Ex. PW1/4 . DW-1 admitted that email dated 06.08.2014 Ex. PW1/3 regarding the fact that light was not lid, was immediately replied by the plaintiff on the same day vide Ex.DW1/P-1 .
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 31 of 4044. DW-1 expressed ignorance about the rectification of the lighting issue. On confronting with email dated 06.08.2014 Ex. DW1/3 , DW-1 admitted that light issue had been resolved/rectified by the plaintiff company and email Ex. DW1/P-2 was sent. DW-1 expressed ignorance that defendants company had made payment of Rs. 16,18,960/- towards part payment of bill no. 187 dated 02.07.2014. DW-1 did not know if defendants had deducted TDS of Rs. 33,040/- on the said payment. DW-1 admitted that email dated 14.06.2014 at 06:46 Ex. PW1/4B was sent by the plaintiff to the defendants. DW-1 admitted that defendants company had never sent an email to the plaintiff to the effect that they had not sent the photographs of advertisements to them. DW-1 admitted that defendants company had acknowledged the invoices vide email dated 22.12.2014 at 12:15pm Ex. DW1/5 and Sh. Sudhir Haryal had marked the said email to him. The witness expressed either ignorance or stated as matter of record to the most of the questions put to him in the cross-examination.
45. This Court finds no merit in the contention raised by the Ld. counsel for the defendants that as regards evidence beyond pleading or the argument that plaintiff cannot be permitted to rely on such pleading as evidence. What Order VI Rule 15A CPC as amended by Commercial Courts Act requires is that the pleadings have to be verified in the prescribed manner in the form of statement of truth/Appendix-I to the schedule r/w Section 16 of the Commercial Courts Act. In the present case, statement of truth filed by the plaintiff is as required u/O VI Rule 15A of the Commercial Courts Act. The pleadings comprise of M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 32 of 40not only the plaint, written statement and also replication when the same are permitted to be filed on record. Admittedly, in the present case, plaintiff filed rejoinder and the material facts stated in para 23 to 28 of the evidence affidavit of the plaintiff had been pleaded in the rejoinder by the plaintiff.
46. The averment regarding total outstanding of Rs.44,00,685/- and the deduction of the TDS described in the tabular chart and the reduction of the TDS as shown in Form 26AS Ex. PW1/26 A to C and the events which occurred subsequent to filing of this suit pursuant to the order dated 17.09.2018 of the Hon'ble Delhi High Court including deposit of sum of Rs.53,66,278/- by the defendants in terms of the order of the High Court cannot be discarded by the court as being beyond pleadings. Indisputably, the initial claim raised by the plaintiff in the plaint was Rs.1,03,93,398/- and then it restricted its claim during cross-examination to Rs.44,00,685/- having received Rs. 53,66,278/-, the sum pursuant to the order of the High Court effectively change in the specified value of the suit.
47. In Pasupuleti Venkateswarlu vs The Motor & General Traders7, Hon'ble Justice V.R. Krishnaiyer observed as under :-
It is basic to our processual jurisprudence that the right to relief must be judged to exist as on the date a suitor institutes the legal proceeding. Equally clear is the principle that procedure is the handmaid and not the mistress of the judicial process. If a fact, arising after the lis has come to court and has a fundamental impact on the right to relief for the manner of moulding it, is brought diligently to the notice of the tribunal, it cannot blink at it or be blind to events which stultify or render inept the decrotal remedy. Equity justifies bending the rules of procedure, where no specific provision or fairplay is violated, with a view to 7 1975 AIR SC 1409 M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.( CS DJ 862/18) Page 33 of 40
promote substantial justice--subject, of course, to the absence of other disentitling (actors or just circumstances. Nor can we contemplate any limitation on this power to take note of updated facts to confine it to the trial Court. If the litigation pends, the power exists, absent other special circumstances repelling resort to that course in law or justice. Rulings on this point are legion, even as situations for applications of this equitable rule are my raid. We affirm the proposition that for making the right or remedy claimed by the party just and meaningful as also legally and factually in accord with the current realities, the court can, and in many cases must, take cautious cognisance of events and developments subsequent to the institution of the proceeding provided the rules of fairness to both sides are scrupulously obeyed.
48. Certificate u/S 65-B of the Indian Evidence Act (Ex.PW-1/28) of PW-1 reads to the following effect :-
Certified that the printout have been produced from computer system using printer and its contents are true reproduction of the original as shown in the email plaintiff company M/s Planet Advertising Pvt. Ltd. and its contents are true reproduction of the original. The print out of tracking report are the same as shown on the Web Site www.indiapost.gov.in to the best of my knowledge and belief. Printout of the same are taken from the computer and printer which is under the control of undersigned. During the said period, the said Computer, Printer and password of ids were under my exclusive knowledge; lawful possession and control are in permanent in nature. Further certified that conditions as laid down in section 65B(2)(a) to 65B(2)(d) of Evidence Act, 1872 regarding the admissibility of computer output in relation to the information and the computer in question are fully satisfied in all aspects.
49. The certificate filed by the plaintiff is in support of electronic record i.e. printouts of SMS and the emails. Court has to consider the evidence as a whole to find out on which side the preponderance of probabilities lies. In his deposition, DW-1 admitted that [email protected] was the email of the defendant. DW-1 admitted that email dated 14.06.2014 at 06:46pm was sent by the plaintiff to the defendants. DW-1 admitted that defendants company had not placed on record any M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 34 of 40email whereby they had pointed out to the plaintiff that photographs of advertisement had not been placed. DW-1 admitted email Ex. PW1/15 . DW-1 admitted that email dated 22.12.2014 at 12:15pm Ex. PW1/5 filed by the defendants company acknowledged the invoices. DW-1 admitted email Ex. DW1/P-3 was written by Sh. Subramanium. DW-1 expressed ignorance about email Ex. DW1/4 and 5. Similarly, he expressed ignorance about the mails dated 22.12.2014 at 03:21 pm Ex. PW1/5. DW-1 admitted the mail Ex. PW1/17. In view of the aforesaid overwhelming evidence regarding the emails, the defects if any, in the certificate u/s 65-B of Indian Evidence Act is of no consequence and will not make a dent in the case of the plaintiff as far as its entitlement is concerned.
50. In order to prove its case, plaintiff proved the original invoices (Ex.PW-1/5 to Ex.PW-1/14). DW-1 Shri Amit Gehlot admitted that defendant company had acknowledged all the invoices raised by the plaintiff. Sh. Kunal Kalra Ld. Counsel for plaintiff submitted that defendants company never raised any objection whatsoever on the receipt of said invoices, but in order to wriggle out to make the payment raised sham defence stating that the invoices were not received by defendants company. Since defendants' witness acknowledged the invoices, therefore, plaintiff's version stands proved.
51. Ld. counsel for the plaintiff submitted that defendants' witness has not admitted but tried to evade in cross- examination, to answer to the fact that he had sent an SMS to plaintiff company's Managing Director by stating "I do not remember whether he has sent an SMS to Mr. Sudhir Haryal." It M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 35 of 40is submitted that defendants' witness has admitted that as per purchase orders, no rental deduction would be made due to power cut or electrical failure. Defendants' witness admitted in cross-examination that the electricity problem raised by defendants company on 06.08.2014 was rectified promptly and that defendants' witness also acknowledged email dated 14.06.2014, wherein defendants company has agreed that they will be liable to make the payment of interest @ 2% per month. Defendants' witness also admitted that defendants company never sent any email to the plaintiff company asking them for the photographs of advertisements. It is submitted that defendants' witness has not denied acknowledgment of the invoices i.e. Ex.PW-1/6 and admitted that plaintiff company had raised invoice from 21.08.2014 till 20.09.2014 with respect to Raja Garden site.
52. Ld. counsel for the plaintiff pointed out that defendants' witness admitted email dated 21.08.2014 whereby plaintiff informed the defendants company that Raja Garden site had been installed. DW-1 admitted e-mail Ex. DW1/P3 whereby defendants company requested not to install the advertisement at Raja Garden. It is submitted that email dated 31.07.2014 (Ex.DW-1/2) is contrary to the email dated 07.08.2014. From the email dated 07.08.2014, it is clear that it was the defendants company who had asked the plaintiff company not to install the site, therefore, plaintiff cannot be held responsible for the same, nor did the plaintiff raised any bill pertaining to that time.
53. DW-1 admitted that on 17.09.2014 one light out of six light was not working due to problem with DMRC M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 36 of 40operation's team and plaintiff had no control over the same. DW- 1 admitted that the said light was immediately fixed and admitted that plaintiff company had sent several emails to defendants company to release the outstanding payments. DW-1 admitted Ex.PW-1/17 i.e. email sent by defendants company to the plaintiff in reply to the request made by the plaintiff to make payment. Evidence on record establishes that plaintiff company carried out the work as per the work order/purchase order and therefore, plaintiff is entitled to the payments for the same.
54. Ld. Counsel for plaintiff submitted that the principle amount claimed in the original suit cannot be the same after receiving an amount of Rs.53,66,278/- pursuant to the order of Hon'ble High Court of Delhi. Plaintiff witness has explained in cross-examination that the payment was made by the defendants only after filing of the present suit and defendants company had not complied with order of the Hon'ble High Court of Delhi. It is submitted that plaintiff's witness specifically clarified in his cross-examination that out of total 11 invoices, part payment qua only six invoices have been paid by defendants company, and rest of the pending payments as mentioned in the tabular form above have not been made.
55. Plaintiff had claimed a sum of Rs.1,03,93,398 alongwith interest in the plaint and admittedly defendants company made payment of Rs.53,66,278/- after filing of this suit in terms of order of Hon'ble High Court of Delhi. Evidence led by the plaintiff has gone un-rebutted and plaintiff's witness has clarified that total outstanding amount without interest and service tax comes to Rs.44,00,685/- and service tax of M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 37 of 40Rs.5,15,815/- is not included in the said amount. On appreciation of evidence on record as a whole, this Court is satisfied that plaintiff has proved it's claimed entitlement of Rs.44,00,685/- apart from service tax of Rs.5,15,815/-. Accordingly, this issue no.1 is decided in favour of plaintiff and against the defendants.
ISSUE NO. 3Whether plaintiff is entitled to interest @ 18% per annum? If so, from which date?
56. Ld. counsel for the plaintiff submitted that plaintiff is entitled to interest on the actual principal amount i.e Rs.1,03,93,398/- as claimed in the plaint till September 2018 i.e., when defendants company deposited the amount of INR 53,66,278/- in the Hon'ble High Court of Delhi interest @18% per annum from October 2018 till realization of the said amount on the outstanding sum of Rs.50,27,120/ (adjusted as Rs.49,16,500/- after deduction of applicable TDS of INR 1,10,620/-). Ld. counsel for the plaintiff submitted that plaintiff has claimed 18% interest on the amount till the filing of the suit and has further claimed an interest @ 2% per month. It is submitted that interest on the delayed payment @ 2% per month is acknowledged by defendants company in the invoices sent by the plaintiff to the defendants company as well as in the email dated 14.06.2014 exhibited as Ex.PW1/4B. It is submitted that email is acknowledged in cross-examination of DW1, therefore, the plaintiff is entitled to the interest as claimed in the plaint. Ld. counsel for defendants submitted that plaintiff is not able to prove on record any agreement between the parties for payment of interest and has failed to prove on record agreement with the M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 38 of 40plaintiff for payment of any interest It is argued that plaintiff is not entitled to any interest from the Defendants.
57. As per Section 34 CPC, wherein and in so far as a decree is for payment of money, the court may, in the decree, order interest at such rate as the court deems reasonable to be paid on the principal sum adjudged, from the date of suit to the date of decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit with further interest at such rate not exceeding 6% per annum at court deems reasonable on such principal sum from the date of decree to the date of payment or to such earlier date as the court deems thinks. As per proviso to Sec 34 CPC, where the liability in relation to the sum so adjudged had arisen out of a commercial transaction, the rate of such further interest may exceed six per cent, per annum, but shall not exceed the contractual rate of interest or where there is no contractual rate, the rate at which moneys are lent or advanced by nationalized banks in relation to commercial transactions. Explanation I. - In this sub-section, "nationalized bank" means a corresponding new bank as defined in the Banking Companies (Acquisition and Transfer of Undertakings) Act 1970. Explanation II.- For the purposes of this section, a transaction is a commercial transaction, if it is connected with the industry, trade or business of the party incurring the liability.
58. Having regard to the lending rate of the bank in the commercial transaction, this Court is of the view that interest @12% per annum is reasonable and would serve the ends of restitutive justice. Plaintiff is entitled to the said interest from the M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 39 of 40date of filing of present suit till the realization of the entire amount. Therefore, this issue no. 3 is decided in favour of plaintiff and against the defendants.
RELIEF
59. In view of findings on issue no. 2, suit filed by the plaintiff being barred by limitation deserves to be dismissed. Order accordingly. Parties shall bear their own costs. File be consigned to record room.
(dictated and announced
in the open Court (VINAY KUMAR KHANNA)
on 28.04.2023) District Judge
(Commercial Court-02)
South Distt., Saket, New Delhi
M/s Planet Advertising Pvt. Ltd. Vs. M/s Ambience Pvt. Ltd & Ors.
( CS DJ 862/18) Page 40 of 40