Delhi District Court
V.J. Cranes Private Liomited vs Ajinkya Infra Projects And Ors on 18 March, 2024
BEFORE THE COURT OF SH. SURINDER S. RATHI, DISTRICT JUDGE
(COMM.)-03 SHAHDARA, KARKARDOOMA, DELHI.
CS Comm. No.183/2019
M/s V J Cranes Private Ltd.
Through its Director
Having its Office at:
30, Savita Vihar, IInd Floor, New Delhi-110092 .......Plaintiff
Vs.
1. Ajinkya Infra Projects
Having its Office at:
Bhawanigarh, Jodhakheda
Post Borela, Tehsil Asind,
Bhilwara-313001, Rajasthan
Also at:
RAPP-7 & 8 Project Plot No. 476,
Ganesh Nagar, Rawatbhata,
Distt. Chittorgarh, Rajasthan
2. Ms. Mithu Kanwer Shaktawat
Bhawanigarh, Jodhakheda
Post Borela, Tehsil Asind,
Bhilwara-313001, Rajasthan ..........Defendants
Date of Institution : 20.09.2019
Date of Final Arguments : 18.03.2024
Date of Judgment : 18.03.2024
Decision : Decreed
Judgment
1. This suit is filed by plaintiff company for recovery of Rs.35,31,126/-
alongwith interest @18% per annum as unpaid dues of invoices raised
for Renting a Crawler Crane.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 1
Case of the Plaintiff
2. Case of the plaintiff as per plaint and the documents filed is that it is a
duly incorporated company and is engaged in business of renting of
various types of cranes for construction jobs and has a goodwill and
reputation in the market. Defendant, a resident of Bhilwara, Rajasthan,
is proprietor of Ajinkya Infra Projects approached the plaintiff at its
Shahdara office for renting one crawler Crane of 150 tons capacity for
using the same at Chittorgarh, Rajasthan for a period of 6 months. As
per work order dated 16.05.2017 the Crane was supplied. The rent
agreed between the parties was Rs.5.25 lakhs per month which was to
be paid each month.
3. Plaintiff raised bills from time to time for demanding the rents.
Defendant used the crane till August 2017 and thereafter it remained
idle at the site. However, no intimation in this regard was sent to the
plaintiff. When the Defendant did not pay up, the plaintiff was
constrained to issue legal notice on 02.01.2018. It is pleaded that
plaintiff is entitled to Rs.35,31,126/- alongwith 18% interest which
was neither replied nor complied.
4. Plaintiff was constrained to approach Shahdara DLSA for Pre-
Institution Mediation under Section 12A of Commercial Courts
Act, 2015 wherein defendant did not participate and Non-Starter
Report dated 18.07.2019 was issued. No pre-suit interest is sought in
the suit for the period November 2017 to September 2019. Plaintiff
was constrained to file suit in hand with following reliefs:
Prayer:
i. Pass a decree of sum of Rs.35,31,126/- in favour of the plaintiff and against
defendants alongwith pendente lite and future interest @18% per annum
from the date of filing the suit till realization;
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 2
ii. Cost of the suit be also awarded in favour of the plaintiff and against
defendant;
iii. Any other relief which this Hon'ble Court may deem fit and proper be also
granted in favour of the plaintiff.
5. Summons of the suit was ordered to be served upon the defendant,
however, vide order dated 07.10.2020 Ld. Predecessor of this Court
rejected the plaint under Order 7 Rule 11 CPC for the reason that
even though plaintiff approached Shahdara DLSA for Pre-Institution
Mediation but it itself did not participate in the proceedings and
consequently it was disposed. This rejection of suit was challenged by
the plaintiff company before Commercial Appellate Division of
Hon'ble High Court of Delhi and vide order dated 19.05.2023 in FAO
(Comm.) No.16/2021, the matter was restored.
6. Defendant was served with the summons of the suit on 16.08.2023.
Initially, plaintiff had impleaded three additional defendants who were
only employees of defendant, a proprietorship firm and as such vide
order of this Court dated 04.10.2023 they were dropped from the array
of defendants. Initially, when no WS was filed within 30 days right of
the defendant to file WS was closed and notional issues were
identified. However, defendant was allowed to file WS upon
condonation of delay subject to payment of cost of Rs.25,000/-.
Case of the Defendant
7. Case of the defendant as per WS filed is that the suit of the plaintiff
deserves to be dismissed as the plaintiff has approached this Court
with unclean hands. Objection is also taken for want of territorial
jurisdiction with this Court with a plea that the defendant is resident of
Bhilwara, Rajasthan and cause of action also took place at Chittorgarh,
Rajasthan.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 3
8. Dismissal of the suit is also prayed on the ground that the material
facts have been concealed. It is pleaded that the lease period of the
crane was to start only from the date of mobilisation of the same at the
project site but the same was never carried out by the plaintiff. On
account of this defendant was constrained to arrange for a Crane
available at the project site with his principal work awarding company
namely M/s Gammon Engineers and Contracts Private Ltd.
(hereinafter referred to as "M/s Gammon"). This company billed and
charged the defendant with the usage amount of their Crane.
9. Interestingly, it is pleaded by the defendant that the crane which was
available at the project site belonged to none other than plaintiff
company but it is claimed that it was neither in a good working
condition nor was certified and accepted by the defendant as per
Clause 2 of the work order. WS pleads that grievances in this regard
were raised by the defendant with the plaintiff as the Crane was
suffering from frequent breakdown and operator related issues. The
defendant has referred to an email dated 21.09.2017 written by its
Project Manager Sudhanshu Shekhar to the plaintiff company's
employee complaining about the breakdown and forewarning that
payments for the breakdown period will be deducted from monthly
invoices. Non-availability of operator at the work site is also
highlighted. The same email was a reply to the plaintiff company's
email whereby they flagged that their outstanding balance for
providing the crane service is not being cleared and a bill amounting
to Rs.21,44,626/- had accumulated and become due.
10.It is case of the defendant that the plaintiff is entitled to payment only
if the crane is in operational condition as per the work order in
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 4
question which provides that on the days when the operator is not
available, the same shall be deducted from the monthly invoices on
prorata basis. A grievance is raised by the defendant that despite the
fact that the crane was not available for days together, the plaintiff has
sought to recover a flat monthly rent for the same. It is pleaded that
plaintiff was supposed to maintain a log sheet of daily deployment
hours which was to be countersigned by the Project Manager of the
answering defendant as per the work order and terms contained
therein, but no log sheet signed by defendant's employee has been
filed.
11.It is also objected that the invoices raised by the plaintiff company
were to be certified by the Defendant's Manager. But none of the
invoices has been so certified. It is also pleaded that plaintiff is not
entitled to any interest on the suit amount. Objection is also raised that
the suit has been filed without placing on record proper resolution of
plaintiff's Board of Directors.
12.In her reply on merits it is not denied by the Defendant that plaintiff is
in the business of renting cranes. Defendant deny approaching plaintiff
at their Shahdara office for renting a 150 Tons Crawler Crane. It is
pleaded that no Crane was supplied by the plaintiff. It is denied that
monthly rent of Rs.5.25 lakhs was agreed. Execution of work order
dated 16.05.2017 containing the terms of contract has not been denied
by the defendant. The bills raised by the plaintiff have been denied as
incorrect and also not in accordance with the work order which
provided for raising of invoices as per actual work hours and certified
invoices and not of flat monthly rent.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 5
13.There is no specific denial to plaintiff's claim that his Crane was used
by defendant till August 2017 as per the contract and thereafter it was
allowed to be remained idle at the site. Defendant simply maintained
that she was not supplied any crane by the plaintiff as per contract.
The WS reiterates that the plaintiff's crane utilized by the defendant at
the site as a stop-gap mechanism suffered from frequent breakdown
and operator related issues. Defendant denies receipt of legal notice.
With these pleas dismissal of the suit was prayed.
14.In his affidavit of admission and denial execution of work order
containing terms of contract between the parties on 16.05.2017 is
admitted, however, the invoices were denied.
Replication:
15.Separate replication was filed by plaintiff company wherein it
reiterated its pleaded case and denied the averments of the defendant.
It is pleaded that the WS categorically admits using plaintiff's Cranes
at Chittorgarh, Rajasthan site and as such this suit deserves to be
decreed under Order 12 Rule 6 CPC. It is denied that no Crane was
supplied to the defendant. Plaintiff has admitted the emails filed and
relied by the defendant.
16.Upon completion of pleadings following issues were identified by the
Court on 04.10.2023 and 22.11.2023:
Issues:
i. Whether plaintiff is entitled to recovery of Rs.35,31,126/- alongwith
interest @18% per annum.? OPP
ii. Relief
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 6
Additional Issue:
i. Whether this Court has no territorial jurisdiction to try this suit?
OPParties
17.Evidence in this case was ordered to be recorded before Ld. LC as per
following protocol created by this Court under Order 18 Rule 4 CPC
read with Order 15A Rule 6(l) CPC as applicable to Commercial
suits. Evidence was recorded before Ld. LC Ms. Neelam Rani,
Advocate appointed by this Court for the sake of timely disposal of
this case.
"Protocol for Recording of Evidence before Court Commissioner appointed by
District Judge, Commercial Court, 2022"
Part - 1
Preliminary
1. Short title- This Protocol is titled "Protocol for Recording of Evidence before Court Commissioner
appointed by District Judge Commercial Court 2022."
2. Statutory Provision- This protocol is prepared as per Order 18 Rule 4 CPC and Order 15A Rule 6(l)
CPC as applicable to Commercial Court.
3. Court- Whenever the term 'Court' appears in this Protocol it should refer to Commercial Court as
defined under Section 2(b) of Commercial Court Act 2015.
Part - 2
Preparation for Assignment
4. Recording of evidence in Commercial Cases- Recording of evidence in Commercial Cases may be
carried out before the Court Commissioner.
Explanation: For reasons to be recorded, Court may retain the case for recording of evidence before the
Court.
5. Appointment of Court Commissioner- As per the Protocol, on the first Case Management Hearing
when the issues are identified, the Court may pass an order for appointment of Court Commissioner.
6. Copy of order be shared with parties and Court Commissioner- Copy of the order of framing of
issues, appointment of Court Commissioner and the schedule of recording of evidence shall be supplied
to the parties as well as the Court Commissioner.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 7
Part - 3
Recording of Evidence
7. Filing of list of witnesses- Both sides shall file list of witnesses preferably within one week but not
later than 15 days of identification of issues before the Court while sharing an advanced copy thereof
with the opposite party.
8. Order of assignment of Case to the Court Commissioner- While assigning the case, following
aspects shall be complied :
i. Schedule of evidence- Recording of evidence shall start within two weeks of identification of
issues. Evidence shall continue on day to day basis, till conclusion. Any alteration in schedule
for recording of evidence, if needed, shall be decided by the Court Commissioner as per
convenience of all concerned, as far as possible. However, entire evidence shall be concluded
within Eight weeks of initiation.
ii. Judicial File- Judicial file shall not be sent or summoned for the purpose of recording of
evidence by the Court Commissioner.
iii. Examination-in-Chief- An advance copy of examination in chief by way of affidavit shall be
supplied to opposite party preferably one week in advance. However, no adjournment shall be
granted in case of non-supply of advance copy.
iv. Production of documents for cross-examination- In case the opposite side is desirous of
production of any document by the witness or any other entity for the purpose of cross-
examination, an application requesting the same shall be moved well in advance before the
Court.
Part - 4
Duty of Court Commissioner
9. Recording of evidence by the Court Commissioner-
i. Place and Time- Court Commissioner shall record evidence either in Lawyer's chamber, or
Judges/Bar Library, Court Room or any other public place within the Court Complex as
mutually agreed by all concerned. Evidence shall be recorded between 10.00 AM to 5.00
PM. It can carry on beyond 5.00 PM as well in case both parties agree. It can be recorded
even on a holiday if all the stakeholders are comfortable and agree to the same.
ii. Chronology of recording- Court Commissioner shall proceed to record the examination by
first recording the deposition of litigating party before examining additional summoned
witnesses.
iii. Oath to witnesses- Court Commissioner shall administer oath to the witnesses under
examination as a delegatee of the Court as per Oaths Act, 1969.
iv. Recording of evidence- The evidence shall be preferably typed on a computer but can also
be recorded by hand neatly.
v. Time frame- Court Commissioner shall conclude the recording of evidence, as early as
possible, but not later than eight weeks of assignment of a case. In case, for any reason the
parties are unable to adhere to the time schedule, extension can be sought from the Court.
vi. Comfortable sitting space- Witnesses and their Counsel shall be provided comfortable
sitting space by the Court Commissioner.
vii. Exhibition of documents- Court Commissioner shall exhibit all the documents sought to
be proved by a party on record. In case of any objection to exhibition of the documents by
either side, the objection shall be recorded in some detail and left open with an assurance
that mere marking of such exhibits will not be treated as conclusive proof thereof and that
admissibility of such document shall be decided by the referral Court at final stage.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 8
viii. Original documents to be retained by parties- Court Commissioner shall make an
observation in the record of evidence of all original documents produced and shall sign the
exhibits with an endorsement OSR (original seen and returned) wherever necessary. If a
party has filed original documents alongwith pleadings in Court, the same can be taken back
as per rules for the purpose of recording of evidence before the Court Commissioner.
Original documents be submitted with the Court at the time of final arguments.
ix. Language- Recording of evidence shall preferably be carried out in English or Court
language, as the case may be, unless requested by the parties otherwise.
x. Adjournments- Once started, the cross-examination shall preferably concluded on the
same day or continue on day-to-day basis. In case of any hardship viz. ill health etc. the
case can be deferred but preferably for a day or two but not later than a week.
In case an evidence schedule is fixed and adjournment is sought by the opposite side, i.e the
side other than who is leading evidence, without 24 hour advance notice.
Explanation: In case a witness scheduled to be examined or under examination is reported
to be unwell or unavailable, the party leading the evidence shall produce the next witness in
line in the list for recording of evidence.
xi. Recording of objections- All the objections raised during cross-examination/reexamination
shall be recorded in the deposition under title objections and shall be left open for the
decision of the Court at the stage of final arguments. Witness shall not refuse to answer the
question asked.
xii. Questions to be allowed- In case Court Commissioner finds any question not related to the
fact and issue, he shall record his objection but shall allow the question to be put and
witness must answer.
xiii. No third person intervention- Court Commissioner shall ensure that the witness is not
assisted by his Counsel or any other person while under examination in answering the
questions.
xiv. Recording of demeanour of witness- Court Commissioner shall record the demeanour of
the witness wherever it is found pertinent and necessary for sharing with the Court.
xv. Copy of evidence- All parties shall be provided uncertified electronic/hard copy of the
evidence recorded, free of cost by Court Commissioner.
xvi. Safe keeping of original deposition- Court Commissioner shall keep the original
depositions in his safe custody till such time they are filed in the Court in original upon
completion of each witness individually.
xvii. Miscellaneous proceedings- Court Commissioner shall maintain a miscellaneous
proceeding sheet for each day of work and shall submit it in the Court at the time of
submission of final report.
xviii. Hostile Witness- In case a witness is sought to be declared hostile, then Court
Commissioner shall refer both the parties to Court at the earliest and the Court shall decide
the issue within three days.
Part - 5
Miscellaneous
10. Summoning of Witness-
i. Summons from Court- In case a litigating party is desirous of summoning a person for
deposition or production of documents, it shall obtain summons from the Court with an
endorsement that such person shall appear before the address of Court Commissioner on
scheduled date, time and place.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 9
ii. Diet Money- Diet money shall be paid to such witness by the party desirous of summoning
as per rules.
11. Advisory to Court Commissioner- While recording the evidence on commission, the Court
Commissioner shall ensure the following:
i. Impartial- Court Commissioner shall conduct himself in an impartial way and behave in
an indiscriminate manner while recording of evidence.
ii. Polite- Court Commissioner shall be polite with the witness and other stakeholders while
recording of evidence.
iii. Confidentiality- Court Commissioner shall maintain confidentiality during the whole
process.
iv. Keeping professional distance- Court Commissioner shall not solicit professional work
from the parties.
v. Integrity- Court Commissioner shall not accept remuneration or any favour in cash or
kind from the parties over and above the honorarium fixed by the Court.
vi. Non-judgmental- Court Commissioner shall not criticize the professional conduct of
lawyers and litigating parties on their understanding of law.
vii. Punctuality- Court Commissioner shall adhere to time schedules and shall not make
excuses like being engaged in some personal or Court work etc.
viii. Coordination- In case of any unforeseen circumstances warranting change of dates of
hearing, for his own case or the request of other side, he shall apprise the other side in
advance via phone call, email, SMS, Whatsapp Group etc..
ix. No third party sharing- Court Commissioner shall not allow the deposition to be
inspected by any third party and shall not share a copy thereof with any stranger without
permission of the Court.
x. Inspection- Court Commissioner shall allow any party to inspect the recorded
proceedings only in his presence.
xi. Recusal- In case either of the parties or Counsel for the parties are related or closely
known to Court Commissioner, he/she shall recuse self from the case and inform the
referral Court.
12. Remuneration of Court Commissioner -
i. Remuneration- In terms of Order 18 Rule 4 of the Code read with Order 15 Rule 2(l)
and Rule 2(o) of the Code, Court Commissioner shall be paid remuneration for the work
carried out.
ii. Mode of payment- Such remuneration shall be paid by the party directly for the work
carried out by way of cash, UPI, Bank Transfer, cheque or draft against due receipt.
iii. Cost to parties- Each party shall individually bear the cost incurred in leading its
evidence.
iv. Fee to be paid- Remuneration fee for recording of evidence is fixed at Rs.2,000/- per
witness or Rs.2,000/- per hour whichever is more. Court Commissioner shall record the
Evidence himself and in case the Stenographer services are taken it can either be arranged
by a litigating party on its own cost or in case the same is arranged by Court
Commissioner, then the actual cost of typing shall be reimbursed by the party to the Court
Commissioner.
v. Litigation Cost- Expenditure incurred in recording of evidence shall be redeemable as
cost of litigation at the end of the suit.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 10
13. Judicial Intervention during recording of evidence-
i. Parties to cooperate- It is expected that both the sides will cooperate with Court
Commissioner as well as with each other in recording of evidence and carry out
proceedings in a cordial manner.
ii. Dissolution of hindrances- In case of any conflict resulting into hindrance recording of
evidence, it shall be resolved amicably by the parties at their own level with the active
help of the Court Commissioner.
iii. Court intervention- However, in case of any unforeseen situation requiring judicial
intervention, Court Commissioner shall fix date and time for joint appearance of both
sides before the Court for removal of any such impediment.
14. Miscellaneous Applications-
i. Moving the application- In case either of the parties is desirous of moving any
miscellaneous application viz. amending of pleadings, interim injunction etc. it shall
share an advance copy with the opposite side and reply thereof, if any, shall be filed and
shared within seven days.
ii. Date of hearing- Upon receipt of reply, both the sides shall get the application fixed for
disposal in the Court with the help of Reader of the Court and shall not wait till next date
fixed for hearing. All such miscellaneous applications shall be registered, numbered and
indexed separately.
iii. Evidence not to be stalled- It is clarified that, unless Court Commissioner is of the view
that the interim application moved by either of the parties is such that evidence cannot be
recorded before its disposal, the recording of PE/DE shall continue unabatedly.
Plaintiff's Evidence
18.To prove its case plaintiff examined its Director PW1 Gurpreet
Singh. Vide his affidavit Ex.PW1/A, he deposed on the lines of plaint
and exhibited following documents:
i. Copy of Original Board of Resolution dated 30.04.2019 is Ex.PW1/1;
ii. Copy of work order dated 16.05.2017 is Ex.PW1/2;
iii. Copies of the bills as raised by the plaintiff are Ex.PW1/3(colly);
iv. Copy of statement of account as maintained by the plaintiff is Ex.PW1/4;
v. Copy of office copy of the legal notice dated 02.01.2018 is Ex.PW1/5;
vi. Copy of postal receipts are Ex.PW1/6 (colly.);
vii. Copy of proof of delivery/acknowledgement are Ex.PW1/7 (colly.);
viii.Copy of non-starter report dated 18.07.2019 issued by Shahdara DLSA is
Ex.PW1/8;
ix. Original Certificate under Section 65B of the Indian Evidence Act is
Ex.PW1/9.
19.In his cross-examination carried out by Ld. Counsel for defendant he
stated that his company is in the business of Leasing out Cranes all
over India on the basis of terms and conditions agreed between the
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parties. Cranes are either sent by way of transportation or are provided
on site if already available. He accepted that in case of transportation
of Cranes e-way bills are generated. In May 2017 plaintiff company
had four Crawler Cranes of 150 tons capacity. The invoices Ex.PW1/3
are signed and issued by plaintiff's accountant and are sent to the
parties by way of email as well as hard copy.
20.He stated that defendant had sought to lease a Crane for six months
but he left the site after four and a half months leaving the Crane idle.
This fact was brought to the notice of plaintiff by M/s Gammon who
subsequently requested that the Crane be supplied to them directly.
The witness could not disclose the date when the above information
was received. The witness stated that defendant approached him
telephonically as well as by email for supply of crane but he could not
disclose the specific name of the person. He stated that one Shekhar
from the defendant's side had contacted him.
21.He denied that he was never approached by the defendant or her
representatives. He stated that the defendant and her employee
Shekhar visited plaintiff's office but accepted that he has no
documentary proof to prove the same. The Crane was supplied on
16.05.2017 onwards but no separate document, receipt or
acknowledgement was prepared. Although the witness claims that he
has log sheets signed by the defendant qua usage of cranes but no such
document has been filed on record. He stated that he had personally
visited the project site once but could not disclose the date.
22.He stated that he had supplied a Crane to M/s Gammon India in
November 2017 after the defendant left the project site and stopped
responding to plaintiff's calls in September 2017. He expressed
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unawareness about the availability of security personnel at the site
with controlled entry and exit and a gate pass system. He accepted that
plaintiff was never issued any gate pass by the defendant for entry into
the project site but maintained that no such pass/letter was required.
As per him the Crane in question was being utilized by a third party
prior to entering of contract with the defendant but he could not
disclose the name of that party.
Defendants' Evidence
23.On the contrary defendant examined DW1 Abhay Singh Shaktawat,
husband of Defendant. Vide affidavit Ex.DW1/A he deposed on the
lines of WS and exhibited following documents:
i. True Copy of the Power of Attorney dated 04.04.2022 is Ex.DW1/1;
ii. True Copy of the email dated 21.09.2017 addressed to the plaintiff is Ex.DW-
1/2;
iii. True Copy of the email dated 22.09.2017 issued by the plaintiff is Ex.DW-
1/3;
iv. Affidavit/Certificate under Section 65B of the Indian Evidence Act, 1872 is
Ex.DW-1/4.
24.In his cross-examination done by Ld. Counsel for plaintiff he stated
that he is just a power of attorney holder of defendant and looks after
the affairs of the firm. He accepted that defendant never issued any
email or notice to the plaintiff. He maintained that no Crane was
supplied. He accepted that no document has been filed by him to show
that the plaintiff's Crane used by him at the site was provided to him
by M/s Gammon. He denied receiving of 6 invoices. He accepted that
defendant firm was sub-contractor of M/s Gammon and carried out
work of laying heavy pipes. His work order was signed by Project
Manager Sh. A K Singh, working for defendant firm.
25.I have heard arguments of Sh. Jaspreet Singh and Sh. Gurbachan
Singh, Ld. Counsels for plaintiff and Sh. Abhishek Prasad, Ld.
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Counsel for defendant. I have perused the case file carefully.
26.Now I shall dispose of individual issues framed in this case.
Additional Issue:
i. Whether this Court has no territorial jurisdiction to try this suit?
OPParties
27.It would be appropriate to cull out the facts admitted by both the sides.
It is admitted that the plaintiff is a duly incorporated company which
is engaged in the business of giving industrial Cranes on rent. It is
admitted case of both the sides that vide a work order dated
16.05.2017 the services of plaintiff was contracted by the defendant
for taking on lease a 150 ton capacity Crawler Crane for a period of 6
months @ Rs. 5.25 lakhs per month including operator charges.
Admittedly, plaintiff has a registered office at Savita Vihar, Shahdara
whereas defendant hails from Bhilwara, Rajasthan and the work site
where the Crane was supposed to be used was at Chittorgarh,
Rajasthan.
28.As far as territorial jurisdiction is concerned, in para 16 of the plaint
Plaintiff has contended that the defendant approached the plaintiff at
their Shahdara office where upon negotiation the contract Ex.PW1/2
was entered which runs into 5 pages. It is case of the plaintiff that the
Crawler Crane was supplied from Delhi and bills were also raised
from Delhi and as such Shahdara Court has territorial jurisdiction to
try this suit.
29.In reply to this it is pleaded by the defendant that neither the defendant
is situated in Delhi nor any cause of action arose in Delhi and as such
Delhi Courts have no territorial jurisdiction. There is no specific denial
qua negotiations and signing of contract in Shahdara, Delhi. The law
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in this regard is clear under Order 8 Rule 5 CPC and Order 8 Rule
3A CPC and proviso to Order 8 Rule 1 CPC. For ready reference the
same are reproduced as under:
Order 8 Rule 5 CPC: Specific Denial
1. "Every allegation of fact in the plaint, if not denied specifically or by necessary
implication, or stated to be not admitted in the pleading of the defendant, shall be
taken to be admitted except as against a person under disability:
Provided that the Court may in its discretion require any fact so admitted to be
proved otherwise than by such admission.
Provided further that every allegation of fact in the plaint, if not denied in the manner
provided under rule 3A of this Order, shall be taken to be admitted except as against
a person under disability."
2. Where the defendant has not filed a pleading, it shall be lawful for the court to
pronounce judgment on the basis of the facts contained in the plaint, except as against a
person under a disability, but the Court may, in its discretion, require any such fact to be
proved.
3. In exercising its discretion under the proviso to sub-rule 1 or under sub-rule 2, the
Court shall have due regard to the fact whether the defendant could have, or has, engaged
a pleader.
4. Whenever a judgment is pronounced under this rule, a decree shall be drawn up in
accordance with such judgment and such decree shall bear the date on which the
judgment was pronouned.
Order 8 Rule 3A CPC: Denial by the defendant in suits before
Commercial Division of the High Court or the Commercial
Court--
i. Denial shall be in the manner provided in sub-rules (2), (3), (4) and (5) of this
Rule.
ii. The defendant in his written statement shall state which of the allegations in the
particulars of plaint he denies, which allegations he is unable to admit or deny,
but which he requies the plaintiff to prove, and which allegations he admits.
iii. Where the defendant denies an allegation of fact in a plaint, he must state his
reasons for doing so and if he intends to put forward a different version of
events from that given by the plaintiff, he must state his own version.
iv. If the defendant disputes the jurisdiction of the Court he must state the reasons
for doing so, and if he is able, give his own statement as to which Court ought
to have jurisdiction.
v. If the defendant disputes the plaintiff's valuation of the suit, he must state his
reasons for doing so, and if he is able, give his own statement of the value of
the suit."
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 15
Order 8 Rule 1 CPC read with proviso which is as provided:
"Provided that where the defendant fails to file the written statement within the
said period of thirty days, he shall be allowed to file the written statement on such
other day, as may be specified by the Court, for reasons to be recorded in writing
and on payment of each costs as the Court deems fit, but which shall not be later
than one hundred twenty days from the date of service of summons and on expiry
of one hundred twenty days from the date of service of summons, the defendant
shall forfeit the right to file the written statement and the Court shall not allow the
written statement to be taken on record."
30.Appreciating the pleadings in the backdrop of the above binding
statutory provisions it is evident that defendant has failed not only to
specifically deny the factual assertion of the plaint that the contract
Ex.PW1/2 was negotiated and finalised at Delhi but he has also not
controverted that the bills were raised from Delhi. Furthermore,
perusal of Contract Ex.PW1/2 shows at Clause 16. Governing Law:
This agreement shall be governed by Indian Law as recognized by the
Court in India under the jurisdiction of Delhi".
31.A submission is made by Ld. Counsel for the defendant that according
to Section 20 CPC a suit can be filed only at a place where defendant
resides or the cause of action or a part cause of action arises. It is
argued that defendant is a resident of Bhilwara while the work contract
was supposed to be completed at Chittorgarh, Rajasthan and as such
Delhi Court should not have any jurisdiction.
32.It is argued by Ld. Counsel for defendant that even though Clause 16
of the Contract carries a reference that Courts at Delhi shall have
jurisdiction but according to him no part cause of action has arisen in
Delhi and as such the Clause 16 cannot confer any jurisdiction on
Delhi Courts which is otherwise non-existent.
33.Reliance is placed on case titled Mohannakumaran Nair Vs.
Vijayakumaran Nair, (2007) 14 SCC 246 so as to bring home a point
that the suit can be filed only at a place where cause of action has
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 16
arisen or where defendant resides. In this very judgment it is
specifically mentioned that the jurisdiction aspect in a Civil Court and
a Writ Court are decided on different parameters. Another judgment
relied is Kusum Ingots & Alloys Ltd. Vs. Union of India and
Another (2004) 6 SCC 254 which is based on jurisdiction in a writ
petition.
34.Law in this regard is well settled. In case titled ABC Laminart
Private Ltd. and Anr. Vs. A P Agencies, Salem, AIR 1989 SC 1239
Hon'ble Supreme Court has ruled that in a contractual matter the
jurisdiction of Court arises from four aspects:
• Where the Contract is entered;
• Where the Contract is to be performed;
• Where moneys have to be paid under the contract and;
• Where defendant resides or voluntary works for gain.
35.As far as place of residence of defendant is concerned evidently it is
Bhilwara Rajasthan. The place of performance of contract is also
admittedly Chittorgarh, Rajasthan. As regards the place where moneys
have to be paid under the Contract admittedly both the contract
Ex.PW1/2 as well as the invoices are silent over the same. Although
there are judgments which show that in the business of any specific
contract in this regard the English "Doctorine of Debtor must seek
the creditor" shall apply. It would be appropriate to have a discussion
on the same as under:
36.In case titled Employees' State Insurance Corporation Vs. M. Hazi
Mohd. Ismail Sahib 1959 SCC Online Madras 2023 full bench of
Hon'ble High Court while discussing Section 49 of Indian Contract
Act concluded,
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 17
"The Common law Doctorine of debtor must seek the creditor is applicable in
Indian Courts."
37. In another case titled Subramanian Swamy Vs. Union of India, 2016
Latest Caselaw 932 SC Hon'ble Supreme Court ruled,
"That by virtue of Article 372 of the Constitution the common law of England
operates as law in Courts in India and a civil action enforcement of common law
right under Section 9 CPC allows operation of common law doctorine of debtor
must seek the creditor."
38. In case titled Bhagwandas Goverdhandas Kedia Vs. M/s
Girdharilal Parshottamdas and Company and Ors., 1965 Latest
Caselaw 171 SC Hon'ble Supreme Court ruled,
"The principles of common law can be relied in the absence of any statutory
provisions to the contrary."
39. In another case titled National Building Construction Corporation
Vs. The Vyasa Bank Ltd., 1991 Latest Caselaw 273 Del the plaintiff
based in Delhi had sued the defendant based in Bangalore. Defendant
took a plea that as per Section 20 CPC the suit can only be filed
where the defendant resides. Hon'ble High Court of Delhi concluded,
"Since in the facts of the case there was no specific provision regarding place of
performance, the principle of debtor must seek the creditor can be safely applied
for deciding the issue of territorial jurisdiction."
40. In case titled Union Bank of India Vs. M/s Milkfood Limited, 2012
Latest Caselaw 3206 Del, the Division Bench of Hon'ble High Court
of Delhi ruled,
"The principle of debtor shall seek the creditor shall be applied unless there is an
arrangement to the contrary."
41.This view of the Division Bench was further relied and followed in
TKW Management Solutions Pvt. Ltd. Vs. Sherif Cargo and Anr.
2023 Latest Caselaw 392 Del of Hon'ble High Court of Delhi.
42.In case titled "M/s Auto Movers Vs. Luminous Power Technologies
Pvt Ltd", 2021 Latest Caselaw 2552 Del. M/s Luminous Power
Technologies Pvt Ltd had filed the suit for recovery of Rs. 28.43 lacs
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 18
against the defendant. In this case, plaintiff had an office at Delhi and
a regional office at Kolkata. The issue of Territorial Jurisdiction was
raised and stand taken by M/s Luminous was that defendant M/s Auto
Movers had made direct RTGS payments in their ICICI bank, Rajouri
Garden, New Delhi. Underlining the general common law principle
"The Debtor should seek the Creditor" as follows :
"17. In its reply to the present petition, the respondent/plaintiff has submitted that in
relation to a claim for the price of the goods sold and delivered, the suit is to be filed where the payments were to be made. Further a debtor had to seek the creditor. It was claimed that the Cheque No. 170120 dated 17.05.2012 for a sum of Rs. 28,48,947/- had been delivered by the petitioner/defendant to the respondent/plaintiff at the Delhi office and the petitioner/defendant knew well that the cheque would be deposited by the respondent/plaintiff at the Delhi Branch. The criminal complaint under Section 138 of N.I. Act was filed in Delhi. The bank statements of the respondent/plaintiff also clearly depict that the petitioner/defendant had made direct payments to the respondent/plaintiff into its account with ICICI Bank at J-12/18, Rajouri Garden, New Delhi-110027. Thus, when on facts and in law, the suit could be filed at Delhi, the learned Trial Court had no committed any error in answering the preliminary issue in favour of the respondent/plaintiff.
"18. What is to be noticed here is that these averments of previous payments being made directly into the bank account of the respondent/plaintiff at Delhi have not been denied by the petitioner/defendant. In its rejoinder, it has dismissed this averment by saying that "accidental" or "even regular deposits of cheques" for "encashment at a branch of respondent's choice cannot clothe the court with territorial jurisdiction". But, this would fortify the claim of the respondent/plaintiff that the invoices did not vest jurisdiction in a court that had no jurisdiction at all.
"19. The learned Trial Court has followed the decision of this Court in Satyapal (supra) that where the place of payment has not been fixed, as appears to be the case here, payment was to be made at the place of the creditor i.e. at Delhi in the present case. The learned Trial Court has not misdirected itself in following the said judgment. The contention of the learned counsel for the petitioner/defendant that Satyapal (supra) was decided in the manner it did, only because the contract was entered into at Delhi and the orders were placed at Delhi is not wholly correct, inasmuch as this Court quoted with approval, the judgment of the learned Trial Court, which clearly held that in cases where the place of payment was not specified in the contracts/bills/invoices, parties had to follow the general rule that the payment had to be made at the place of the creditor. "22. When in the present case, the part cause of action has arisen also on account of the payments made by the petitioner/defendant directly into the bank account of the respondent/plaintiff, even if these were not not on regular basis, since there is nothing to show that the place of payment had been fixed, even without following the principal that the 'debtor must seek out the creditor'. It is clear that the Delhi Courts have jurisdiction to try this suit and the invoice does not vest jurisdiction in a court which had no jurisdiction at all."
43.As far as the first aspect in ABC Laminart case of the place of entering of contract is concerned, as discussed supra it is in Delhi. According to the plaintiff the negotiations, deal and written contract was entered at CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 19 Delhi. This fact has not been denied by the defendant in the WS. I do not find any strength in the plea that the term "deal" cannot be read as a contract entered between the parties. Civil Courts have to take note of the fact that litigations are launched by common people who are engaged in general business and they may not have the understanding of law and legal terminologies as it is.
44.The assertion that negotiation and deal was entered at a particular place and the place is duly mentioned in the contract, it shall be treated that it is the contract happened at the cited place. The cross- examination of PW1 shows that owner of the defendant as well as his employee had approached the plaintiff at his Delhi office before the contract in question was entered. As such applying the material available in this case this Court has no hesitation in concluding that the contract Ex.PW1/2 was entered in Delhi. As such this issue is answered in favour of plaintiff and against the defendant.
Issue No. 1i. Whether plaintiff is entitled to recovery of Rs.35,31,126/- alongwith interest @18% per annum.? OPP
45.The plaintiff company asserted that crane was supplied by it to the defendant at Chittorgarh work site. This fact has although been denied in the pleadings but in the WS itself the defendant has come up with an unusual defence story wherein he says that he did use the Crane belonging to the plaintiff but continued to maintain that the crane was not supplied to him by the plaintiff company. Rather it is pleaded that the Crane was used by the Defendant was supplied by plaintiff to M/s Gammon from whose Defendant procured it.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 20
46.It is argued by Ld. Counsel for plaintiff in support of the suit claim of Rs.35.31 lakhs that by virtue of the admitted document i.e. work order Ex.PW1/2 dated 16.05.2017 a crawler crane with capacity of 150 ton was leased for an initial period of six months at a monthly rent of Rs.5.25 lakhs. It is submitted that in so far as this crane was available at the work site itself, the services of the same were provided by the plaintiff to the defendant for the 6 months period starting from 16.05.2017 to November 2017.
47.Six invoices were issued which are Ex.PW1/3 (colly.) While the first invoice dated 30.06.2017 is for the month of May but pertains to only 15 days. The 2nd, 3rd, 4th, 5th invoices are for months of June, July, August and September. No invoice has been raised for the month of October or for that matter for the month of November. A bill dated 01.11.2017 is issued for a sum of Rs.7.67 lakhs but the same is for the head "Crane Immobilization Charges" and not for the monthly usage. Hence, practically it is found that as against a 6-month tenure plaintiff has raised invoices of only 4 and a half month tenure.
48.While appreciating this submission in the light of pleadings and the documents available it is found that although, on the one hand, defendant denies having been supplied a crane by the plaintiff but in the pleadings as well as during the cross-examination of DW1 it has been overwhelmingly admitted that a crane belonging to the plaintiff which was available at the site was actually utilized by the defendant but only with a rider that the crane used by the defendant was supplied by the plaintiff to M/s Gammon and not directly to this defendant. This plea of the defendant is ex-facie unbelieveworthy for the simple reason that in case the plaintiff did not at all act upon the agreement CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 21 Ex.PW1/2, then in terms of Clause 14 of the contract the contract was deserved to be terminated by the defendant by serving a 7 day notice. For ready reference the same is reproduced hereunder:
Clause 14 : Notice period for demobilization The contract will terminate by default upon completion of the contract lease rent period, provided no extension is sought for by the lessee. Only in the event of premature termination of the contract period, the Lessee shall serve an advance notice of 7 days to the Lessor for demobilization and termination.
49.In support of the suit claim it is rightly pointed out by Ld. Counsel for plaintiff that the plea of non-supply of crane by the plaintiff to the defendant is nothing but an afterthought and a concocted defence. In so far not only no notice of non-supply of crane was ever sent by the defendant to the plaintiff but rather the defendant's employee Sudhanshu Shekhar, Project Manager had himself sent an email Ex.DW1/2 dated 21.09.2017 where instead of airing any grievance about now claimed non-supply of crane he rather notes that the crane was not operational from 12.09.2017 onwards.
50.It is argued that this is the first communication received by the plaintiff from the defendant post penning down of contract dated 16.05.2017 whereby not only the supply and operationalization of crane by the plaintiff to the defendant is admitted. It is accepted that the crane was operational till as late as up to 12.09.2017. This email was replied by the plaintiff wherein they raised the grievance that their four bills apparently issued for the month of May, June, July and August have remained unpaid whereby a debit balance of Rs.21.44 lakhs odd rupees is due. In a trail mail issued on 22.09.2017 it is clarified that the crane is made inoperational on account of non- payment of bills by the defendant. For ready reference the text of three CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 22 trail mails is reproduced hereunder:
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 23
51.It is further argued by Ld. Counsel for plaintiff that the above email exchanged between the parties is sufficient to establish and prove the right of the plaintiff to seek the rent of the crane as per contract Ex.PW1/2. It is further pointed out that the defence of the defendant not only suffers from taking contradictory stands and pleas but is also suffering from several technical flaws that the WS has been filed by husband of the proprietor of the defendant firm on the basis of a General Power of Attorney which is ex-facie defective.
52.It is also pointed out that the affidavit of statement of truth is not as per Appendix 1 of Commercial Courts Act and it is nowhere pleaded or deposed by DW1 Abhay Singh Shaktawat that he was having personal knowledge of the business between the plaintiff and the defendant and was competent to depose. Evidently, the contractual obligations between the parties emanates from contract Ex.PW1/2 which bears signatures of Smt. Mithu Kumar Shaktawat but this document has not been signed by Smt. Mithu Kumar Shaktawat even though the rubber stamp appended on this document reads "For Ajinkya Infra Limited the Bhilwara Proprietor".
53.The text used in the rubber stamp is misleading and false as upon being confronted Ld. Counsel for defendant concedes that defendant is a proprietorship firm and not a public limited company as sought to may be made out in the contract Ex.PW1/2. The dispute evidently pertains to the year 2017 which was followed by issuance of legal notice by the plaintiff on 02.01.2018 and consequent filing of suit in the year 2019 in the earlier version followed by its revival under directions of Hon'ble Delhi High Court.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 24
54.Interestingly, the WS is filed not by the proprietor Smt. Mithu Kumar Shaktawat but by Abhay Singh Shaktawat who happens to be her husband. It is pointed out by Ld. Counsel for plaintiff that in the General Power of Attorney filed and relied as Ex.DW1/1 by the defendant alongwith WS the same is prepared only on 05.04.2022 i.e. around 5 years after the cause of action and the dispute arose. Close reading of this 6 page GPA shows that it nowhere carries a reference that the Attorney Abhay Singh Shaktawat is privy to the facts of the dispute and has been looking after the business of the defendant firm in the year 2017. All that has been pointed out is that he is authorized to carry out the job of defending the first appeal and the civil suit in hand on behalf of defendant.
55.Ld. Counsel for plaintiff has in this regard relied on case titled A.C. Narayanan and Ors. Vs. State of Maharashtra and Ors., 2013 Latest Caselaw 649 SC decided on 13.09.2013 wherein the Full Bench of Hon'ble Supreme Court has in para 26 summarised the law on filing of cases specifically under Section 138 of NI Act through power of attorneys. The same is reproduced as under:
26."While holding that there is no serious conflict between the decisions in MMTC (supra) and Janki Vashdeo Bhojwani (supra), we clarify the position and answer the questions in the following manner:
i. Filing of complaint petition under Section 138 of NI Act through power of attorney is perfectly legal and competent.
ii. The Power of Attorney holder can depose and verify on oath before the Court in order to prove the contents of the complaint. However, the power of attorney holder must have witnessed the transaction as an agent of the payee/holder in due course of possess due knowledge regarding the said transactions. iii. It is required by the complaint to make specific assertion as to the knowledge of the power of attorney holder in the said transaction explicitly in the complaint and the power of attorney holder who has no knowledge regarding the transactions cannot be examined as a witness in the case. iv. In the light of Section 145 of NI Act, it is open to the Magistrate to rely upon the verification in the form of affidavit filed by the complainant in support of the complaint under Section 138 of the NI Act and the Magistrate is neither CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 25 mandatorily obliged to call upon the complainant to remain present before the Court, nor to examine the complainant of his witness upon oath for taking the decision whether or not to issue process on the complaint under Section 138 of the NI Act.
v. The functions under the general power of attorney cannot be delegated to another person without specific clause permitting the same in the power of attorney. Nevertheless, the general power of attorney itself can be cancelled and be given to another person.
56.Although the above five guidelines are applicable to both civil and criminal jurisprudence but the law on filing of civil suits through an attorney was summarised by Hon'ble Supreme Court in Janki Vashdeo Bhojwani and Anr. Vs. Indusind Bank Ltd. and ors., 2004 Latest Caselaw 697 SC in Civil Courts. The relevant text is reproduced as under:
"Order 3 Rules 1 and 2 Code of Civil Procedure empowers the holder of power of attorney to 'act' on behalf of the principal. In our view the word 'acts' employed in Order 3 Rules 1 and 2 Code of Civil Procedure confines only to in respect of 'acts' done by the power-of-attorney holder in exercise of power granted by the instrument. The term 'acts' would not include deposing in place and instead of the principal. In other words, if the power of attorney holder has rendered some 'acts' in pursuance of power of attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for the acts done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter of which only the principal is entitled to be cross-examined."
57.Appreciating the Special Power of Attorney (SPA) Ex.PW1/1 in the light of above caselaw it is found that DW1 Abhay Singh Shaktawat is not shown to be aware of material facts so as to empower him to file this suit as an attorney as also to step into the witness box and depose on behalf of the defendant to this ignorance of the facts of defence is writ large from the body of the WS as also the verification with the WS, supporting affidavit and statement of truth.
58.Perusal of verification of WS dated 07.11.2023 shows that it nowhere clarifies as to which para of the WS is based on his knowledge and which para is based on legal advice. Likewise, supporting affidavit is CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 26 also ambiguous for it does not specify as to which para is as per his knowledge.
59.Interestingly, the statement of truth as filed at running page 19 by the Attorney is not only blank at para 5 but is also a distorted version of the template provided by the Legislature. The para 2 of the template at Annexure 1 needs a solemn affirmation by the deponent that "I am sufficiently conversant with the facts of the case and have also examined all relevant documents and records in relation thereto." This important component of statement of truth is found to be raising from the version filed by the defendant with the WS. All that is stated is that since the deponent holds an SPA of the defendant he is conversant with the facts and circumstances.
60.Evidenly, if the deponent is claiming knowledge of facts on account of being an attorney his knowledge starts from 04.04.2022 when the attornment happened through Ex.PW1/1 and not from 2017 when the dispute started between the parties. On account of this serious flaw in the statement of truth, the same deserves to be rejected and taken off the record from the defence. In the absence of statement of truth the whole defence of the defendant crumbles down and is akin to no defence at all.
61.Be that as it may it is further pointed out by Ld. Counsel for plaintiff that even if the defence of the defendant is read for sake of arguments, it is neither compliant of Order 8 Rule 5 CPC qua specific denial nor compliant of Order 8 Rule 3A CPC qua reasons for denial of factual pleas but is rather admitting the specific factual pleas of the plaintiff. Likewise, it is pointed out that in para 3 of the plaint it is categorically stated by the plaintiff company that in pursuance of work order dated CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 27 16.05.2017 the crawler crane was supplied to the defendant at the work site. In reply to this para all that is stated is that contents of this para are matter of record and that the plaintiff has not been maintaining log sheets which are to be countersigned by the defendant's Project Manager.
62.A cursory reference that his preliminary submissions be read as reply to this para is neither envisaged under the laws of pleadings nor can be treated as compliance of Order 8 Rule 3A CPC which has been specifically legislated so that commercial disputes are raised and defended with some sense of accuracy and specification. Newly added proviso to Order 8 Rule 5 CPC when read in the context of the suit in hand categorically shows that the evasive denial by the defendant shall lead to an inference that the defendant has admitted the contents of the plaintiff's plaint.
63.It is further argued by Ld. Counsel for plaintiff that the defendant has been not only dishonest during the contractual period by not paying a single invoice raised qua the 6 months lease period but has also not cared to send reply to the legal demand notice sent to her. The legal notice Ex.PW1/5 is duly supported with Postal Department receipt Ex.PW1/6 and acknowledgement cards Ex.PW1/7 it collectively shows that it was duly served upon the defendant but she did not care to send any reply to the same.
64.Since the legal demand notice was not replied by the defendant despite due service as per case titled Jayam Company Vs. T. Ravi Chandaran 2003 (3) RCR (Cr.) 154 Madras presumption is drawn against defendants that they have admitted the contents of the legal notice.
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 28
65.In another case titled as Metropolis Travels & Resorts (I) Pvt. Ltd. Vs. Sumit Kalra and Ors., 2002 Latest Caselaw 714 Del wherein it was observed that :
"13. There is another aspect of the matter which negates the argument of the respondent and that is that the appellant served a legal notice on the respondent vide Ex. PW1/3. No rely to the same was given by the respondent. But in spite of the same, no adverse inference was drawn against the defendant. This court in the case of Kalu Ram Vs. Sita Ram 1980 RLR 44 observed that service of notice having been admitted without reservation and that having not been replied in that eventuality, adverse inference should be drawn because he kept quite over the notice and did not send any reply. Observations of Kalu Ram's case (supra) apply on all force to the facts of this case. In the case in hand also despite receipt of notice, respondent did not care to reply nor refuted the averments of demand of theamount on the basis of the invoices/ bills in question. But the Ld. Trial court failed to draw inference against the respondent".
(Emphasis Supplied)
66.Ld. Counsel for plaintiff has also relied upon case titled as Krishan Kumar Aggarwal Vs. Life Insurance Corporation, 2010 Latest Caselaw 3344 Del wherein Hon'ble Delhi High Court observed that:
"65. No explanation has been rendered by the respondent as to why letter dated 23rd August, 2008 and the legal notice send by the appellant were not repudiated or even replied. Despite due receipt, the respondent did not bother to even send any response to the letter dated 23 rd August, 2008 or the legal notice, the contents whereof would be deemed to have been admitted. In the judicial precedents reported in Rakesh Kumar Vs. Hindustan Everest Tool Ltd. MANU/SC0396/1988: (1988) 2 SCC 165 & Hirallal Kapur Vs. Prabhu Chaudhary MANU/SC/0189/1988 : (1988) 2 SCC 172 it was held by the Supreme Court that a categorical assertion by the landlord in a legal notice if not replied to and controverted, can be treated as an admission by a tenant.
"66. In a Division Bench proceedings of this court reported in Metropolis Travels and Resorts Vs. Sumit Kalra MANU/DE/0562/2002 : 98 (2002) DLT 573 (DB), no adverse inference was drawn against the respondent for failure to reply the legal notice on consideration of the facts and circumstances of the case. Reference was made to proceedings reported in Kalu Ram Vs. Sita Ram wherein it had been observed that service of notice being admitted without reservation and that having not been replied, in that eventuality, adverse inference should be drawn".
(Emphasis Supplied) CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 29
67.As such, in the light of the above law, an adverse inference deserves to be drawn against defendant and in favour of plaintiff about the correctness of the contents of the legal notice.
68.On the other hand, it is argued by Ld. Counsel for defendant that the suit of the plaintiff deserves to be dismissed firstly on the ground that the suit has been filed on the basis of flawed resolution by the Board of the plaintiff company. It is submitted that the document Ex.PW1/1 is signed by Gurpreet Singh, Director who has himself signed the plaint and has sworn the affidavits as also has stepped into the witness box as PW1. I see no strength in this plea for the reason that it is not a resolution passed by an individual in the name of his own self or by a Director authorising himself but it is a resolution passed by a Board of Directors and these signatures appended on Ex.PW1/1 is only a certification of the resolution and is not a one-man resolution as sought to be made out.
69.It is further argued that while the defendant maintains that the contract Ex.PW1/2 of supply of a Crawler Crane of 150 tons was never carried out by the plaintiff but the defendant is still taken a diagonally opposite plea and defence stand that she had actually utilized the plaintiff's crane which was available at the work site. Although in Civil law more specifically in Commercial Law diagonally opposite defences cannot be permitted. Unlike civil litigation, in commercial litigation the pleadings have to be more accurate, specific and unambiguous. Once the defendant admits utilizing the plaintiff's Crane, the onus of establishing and proving that the plaintiff's Crane was procured by her not from the plaintiff but through a third party M/s Gammon in terms of Section 102 and 103 of Evidence Act is on CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 30 the Defendant only. The same are reproduced as under:
Section 102 Evidence Act: On whom the Burden of Proof lies The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side. Illustration:
(a) A sues B for land of which B is in possession, and which, as A asserts, was left to A by the will of C, B's father.
If no evidence were given no either side, B would be entitled to retain his possession. Therefore the burden of proof is on A.
(b) A sues B for money due on a bond.
The execution of the bond is admitted, but B says that it was obtained by fraud, which A denies.
If no evidence were given on either side, A would succeed, as the bond is not disputed and the fraud is not proved.
Therefore the burden of proof is on B. Section 103 Evidence Act: Burden of Proof as to particular fact The burden of proof as to any particular fact lies on that person who wishes the Court to believe in its existence unless it is provided by any law that the proof of that fact shall lie on any particular person. Illustration:
(a) A prosecutes B for theft, and wishes the Court to believe that B admitted the theft to C. A must prove the admission.
B wishes the Court to believe that, at the time in question, he was elsewhere. He must prove it.
70.Admittedly, not a single document whatsoever has been filed by the defendant to substantiate or prove this plea. In the absence of any iota of evidence, the defendant has miserably failed to establish on record that the plaintiff's crane utilized by her was not provided to her by the plaintiff but was rather provided to her by M/s Gammon.
71.The falsity of this plea is also writ large from the fact that even though the contract Ex.PW1/2 carries a specific clause that this contract is initially for a period of 6 months but can be brought to an end only by CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 31 lessee i.e. defendant by serving a 7 days notice. Admittedly, neither any notice was issued nor any protest in the form of email or any other communication was raised qua the unsuccessful defence plea of non- supply of crane.
72.Another plea raised on behalf of defendant is that in terms of the contract Ex.PW1/2, the plaintiff was supposed to raise bills only from the date of mobilization of the crane. It is argued that no notice of mobilization has been filed or proved on record and as such the plaintiff has no authority to bill the defendant from 16.05.2017 onwards.
73.The contents of the contract nowhere shows that a written mobilization notice was required to be issued but as rightly pointed out by Ld. Counsel for plaintiff, DW1 in his cross-examination has accepted that the plaintiff's crane was available at the work site itself and was provided to him. Neither any suggestion has been made to PW1 qua any delayed date of mobilization of crane nor any such document or oral submission has been made by DW1 in his evidence.
74.Another plea raised is that as per condition no. 2, the crane was supposed to be in good working condition and plaintiff was supposed to have certified log sheets for payments to be made to the company. It is accepted by Ld. Counsel for plaintiff that no log sheets have been filed or proved on record.
75.As regards the good working condition is concerned, it is his case that after the crane was provided on 16.05.2017 only one email was received that too on 21.09.2017 after around more than 4 months of supply of the crane. It is argued that in a quick response to the email the defendant was told that there is absolutely no fault in the working CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 32 of the crane and that rather services of the Crane have been withheld on account of non-payment of 4 invoices valuing Rs.21.44 lakhs by the defendant.
76.As regards the plea that the plaintiff has not placed work logs on record, perusal of the contents of the contract Ex.PW1/2 nowhere shows that mere non-preparation of logs by the defendant would render the plaintiff non-entitled to the lease amount.
77.Rather this plea is self-contradictory stand of the defendant in so far as the other defence taken by the defendant in this case is that the charges of utilizing the plaintiff's 150 tons capacity crawler crane stood paid by her to M/s Gammon. In case the plaintiff was not maintaining certified logs, the question of defendant paying the Crane usage charges to M/s Gammon too should not have arisen.
78. A back up submission is raised that it is not the defendant who paid money to M/s Gammon but M/s Gammon itself deducted the crane charges from her bills is also a submission which is neither established nor proved on record. Rather an adverse inference under Section 114
(g) of the Evidence Act deserves to be drawn against the defendant for her failure to prove any iota of evidence in support of her story that she paid money to M/s Gammon or for that matter M/s Gammon deducted its money or the cranes provided by the plaintiff. Section 114 Evidence Act: Court may presume existence of certain facts Illustration The Court may presume-
(g) That evidence which could be and is not produced would, if produced, be unfavourable to the person who withholds it;
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 33
79. In case titled Krishan Dayal Vs. Chandu Ram 1969 SCC Online Delhi 134 while discussing the effect of withholding of material documents like account book it was observed that:
"Question then arises as to what is the effect of the withholding of material account books. In this respect I find that according to illustration (g) under Section 114 of the Evidence Act, the evidence which could be and is not produced would, if produced, be unfavorable to the person who withholds it. The principle underlying the above illustration has been applied by their Lordships of the Supreme Court in cases wherein a party in possession of material document does not produce the same. It has accordingly been held that the non-production of a material document by a party to a case would make the Court draw an inference against that party, (see in this connection Atyam Veerraju and others v. Pechetti Venkanna and others and Union of India v. Mahadeolal Prabhu Dayal.
The principle underlying illustration (g) under Section 114 of the Evidence Act has also been applied to a suit for rendition of accounts wherein a party to the suit withholds material account books. A Division Bench of the Calcutta High Court (Mookerjee and Panton, JJ.) in the case of Debendra Narayan Singh v. Narendra Narayan Singh and others held:- "In a suit for accounts, the non- production of account books by the party who has custody of them justifies the presumption under Section 114(g). Evidence Act, that they have been withheld, because if produced, they would have been unfavorable to his case. If he is the plaintiff and is claiming accounts though withholding papers, his suit is liable to be dismissed: Upendra Kishore v. Ram Tara Chand Ram v. Brojo Gobind Doss. If he is the defendant who is liable to render accounts, the Court will proceed on the footing of evidence furnished by the plaintiff, and in doing so, may make all reasonable presumptions against him".
80.In case titled Union of India Vs. Mahadeolal Prabhudayal AIR 1965 SC 1755 Hon'ble Supreme Court while discussing judgments passed by Privy Counsel ruled that:
"If it is found that a party to a suit breaches its application to give full disclosure of relevant facts and materials, the Court shall invoke the presumption attached to Section 114(g) of the Evidence Act."
81.Another plea raised on behalf of defendant is that according to para 5 of the plaint the Crane was utilized by the defendant only till August 2017 and as such the plaintiff is not entitled to seek recovery of lease for the month of September 2017 as well. Even this plea of the defendant is self-contradictory in so far as in the email Ex.DW1/2 (reproduced supra) the defendant has categorically accepted that the CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 34 plaintiff's crane supplied to her was under use till 12.09.2017 even otherwise the lease Ex.PW1/2 provides for monthly billing of Rs.5.25 lakhs for six months usage of the crane and no methodology was provided therein for non-working hours, lunch hours and breakdown periods as sought to be raised by the defendant by citing Clause 4 of the contract.
82.A plea is raised by Ld. Counsel for defendant that as per plaintiff's own email reply dated 22.09.2017 they have admitted to the fact that they are not providing crane services from 12.09.2017 onwards and as such the plaintiff shall not be entitled to the lease period for the remaining part of September 2017. This statement on the part of plaintiff has to be read in context of the background in which the statement was made. In the previous trail email it has been specifically mentioned that defendant did not pay the last four bills of Rs.21.44 lakhs even though as per contract Ex.PW1/2 the invoice was supposed to be paid within 30 days but still the plaintiff continued to admittedly provide the crane services.
83.As such considering the fact that the contract in question had a lock in period of 6 months and the plaintiff is not claiming any lease charge for one and a half months, I see no reason as to why the defendant's failure to pay the lease charges to the plaintiff can be read in support of the defendant against the plaintiff's claim in the manner so done.
84.At the end, I find strength in one plea raised by Ld. Counsel for defendant and that is qua invoice dated 01.11.2017 which is for Rs.7.67 lakhs for "Demobilisation Charges" of the Crawler Crane. It is pointed out that in terms of Clause 10 which is reproduced hereunder for ready reference:
CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 35 "The cost of demobilisation of the crane was to be borne by the lessor and not by the lessee".
85.Accordingly it is hereby ruled that the plaintiff is not entitled to recovery of the Demobilization Charges amount. In view of the above decision issue no. 1 is answered in favour of plaintiff and against the defendant qua the suit claim principal amount after deducting Demobilization Charges.
Interest:
86.As far as the rate of interest sought @18% is concerned, perusal of the contract shows that it is silent on the interest rate. Perusal of the invoices also shows that no rate of interest has been specified. Although Order 7 Rule 2A CPC as amended for commercial Courts provide for specifying the reason as to under what provision or contractual term a particular rate of interest is claimed. In the suit in hand the interest is payable as per Section 34 CPC. For ready reference, Section 34 CPC is reproduced hereunder:
Section 34 CPC: Interest
(i)"Where and in so far as a decree is for the 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 the suit to the date of the 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 as the Court deems reasonable on such principal sum from the date of the decree to the date of pay- ment, or to such earlier date as the court thinks fit.
(ii).Provided that 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 6% per an-
num but shall not exceed the contractual rate or interest or where there is no contrac - tual rate, the rate at which moneys are lent or advanced by nationalized banks in re- lation 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 trans- action, if it is connected with the industry, trade or business of the party incurring the liability.
Where such a decree is silent with respect to the payment of further interest (on such principal sum) from the date of the decree to the date of the payment or other earlier CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 36 date, the Court shall be deemed to have refused such interest, and a separate suit therefore shall not lie. (Emphasis Supplied)
87.Section 34 CPC provides that plaintiff will be entitled the interest at the rate at which Court finds reasonable. For a general suit, the rate of interest prescribed is 6% and for commercial suit, the Parliament pro- mulgates that rate of interest may increase from 6% to a rate which is found reasonable. Plaintiff is accordingly entitled to only the rate at which RBI has issued Circular for Commercial suits.
88.As far as the interest is concered, rate applicable to Commercial transaction shall be payable. As per RBI notification dated 30.08.2022 issued vide Press Release no.2022-2023/794 whereby advisory issued by RBI to Schedule Commercial banks of accepting deposit rates @ 9.05% per annum.
Relief
89.In view of the above, I have no hesitation in concluding that plaintiff is entitled to decree with cost for a sum of Rs.35,31,126 - Rs.7,67,000 (Demobilization Charges) = Rs.27,64,126/- alongwith 9% interest pendente lite and till realization. Lawyer's fees is assessed as Rs.35,000/-.
90.Decree sheet be prepared accordingly. File be consigned to Record Room after due compliance.
(SURINDER S. RATHI) District Judge, Commercial Court -03 Shahdara District, KKD Delhi/18.03.2024 CS Comm. No.183/2019 M/s VJ Cranes Private Ltd. Vs. Ajinkya Infra Projects Page 37