Delhi District Court
M/S Siddhi Vinayak Plastic vs Shree Ram Enterprises on 26 February, 2024
IN THE COURT OF MS. NEETI SURI MISHRA
SCJ CUM RC (NORTH), ROHINI COURTS, DELHI
In the matter of :-
M/s Siddhi Vinayak Plastic
Through its proprietor
Sh. Sunil Kumar
At L-190, Sector-5,
DSIDC INDUSTRIAL AREA,
BAWANA,
DELHI-110039.
GSTIN/UIN NO. 07AASPK4799C1Z7 .....Plaintiff
VERSUS
M/s SHREE RAM ENTERPRISES
Through its proprietor/partner/AR/AS
Smt. Neelam,
A-8/22, Nawab Yusuf Road,
Civil Lines, Prayagraj
Uttar Pradesh
GSTIN/UIN NO. 09EQBPK9723DIZR. ..... Defendant
EX-PARTE JUDGMENT
CNR No. DLNT 0300 1149 2023
Case No. 594/23
Recovery of Rs. 45,128/-
Under Section
alongwith interest
Date of Institution 02.06.2023
Date of reserve for order 23.02.2024
Date of Final Order 26.02.2024
Final Order Decreed
BRIEF FACTS
1. Vide this judgment, I shall decide the suit instituted CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 1 of 12 by the Plaintiff against the Defendant for the recovery of Rs.45,128/-(Rupees Forty Five Thousand One Hundred Twenty Eight) along with compound interest as per the MSME guidelines, cost of the suit and any other order as the Court may deem appropriate in favour of the Plaintiff.
2. The case of the Plaintiff, as is discernible from the pleadings and the documents filed by the Plaintiff, is that the Plaintiff is a Proprietorship concern engaged in the business of manufacturing of auto parts. It is functioning under the name and style of M/s Siddhi Vinayak Plastic in Bawana, Delhi. Defendant is also a Proprietorship concern doing business of auto parts under the name and style of M/s Shree Ram Enterprises at Civil Lines, Prayagraj, U.P. That the Defendant had purchased a variety of auto parts from the Plaintiff vide invoice bearing No. SVP/138/2022-2023 dated 05.08.2022 for a sum of Rs.51,963/- (including IGST) on credit basis. Goods were supplied to Defendant which were received by Defendant without any demur or protest regarding quality and quantity of goods. Invoice was thereafter raised. This invoice also includes the amount of CGST and SGST. But the Defendant has failed to pay Rs.51,963/- to the Plaintiff till date. Finding no alternative, Plaintiff sent a legal notice dated 24.04.2023 to the Defendant at its address through its counsel for recovery of Rs.51,963/- through speed post and courier on 24.04.2023 which were returned back. That as Defendant failed to clear the outstanding dues of Plaintiff, Plaintiff was constrained to file the present suit.
CS SCJ No. 594/230M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 2 of 12
3. It is further averred that the Defendant was duly informed about the legal notice telephonically as a result of which Defendant approached the Plaintiff and gave three post dated cheques bearing Nos. 000043, 000044 and 000045, all drawn on IDFC First Bank, Branch Prayagraj, M. Road, Allahbad-211001, U.P. to the Plaintiff towards discharge of its liability.
4. It is further averred that on the assurance of the Defendant, Plaintiff presented the first cheque bearing No. 000043 dt. 11.05.2023 drawn on IDFC First Bank, Prayagraj Branch, M. Road, Allahabad U.P. for a sum of Rs.14,000/- with his banker i.e. Bank of India, Bawana Branch, Delhi but the same was returned dishonourned by the Plaintiff's bank with the remarks "Drawers signature differs" vide memo dated 12.05.2023. That Plaintiff immediately informed the Defendant about the dishonour of the said cheque and the Defendant requested the Plaintiff to present the same after three days and assured that he would manage his signature in his bank. On the assurance of the Defendant, Plaintiff again presented the above- stated cheque on 15.05.2023 but the same was again returned dishonoured by the Plaintiff's bank with the remarks "Funds insufficient" vide memo dated 16.05.2023 (which was endorsed by the Plaintiff's bank on the back side of the cheque).
5. It is further averred that Plaintiff thereafter requested CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 3 of 12 Defendant several times through telephone to release the outstanding amount but the Defendant did not pay heed to the same. It is further averred that the Defendant is legally bound to pay the outstanding amount of Rs.45,128/- alongwith 18% p.m. till realization. Thereafter, on 18.11.2023, on the request of Ld. Counsel for the Plaintiff the present suit was converted into ordinary suit for recovery of money and statement of Ld. Counsel for the Plaintiff was recorded separately to this effect.
6. It is further averred that despite the service of Defendant on 03.08.2023, Defendant did not appear in Court, hence he was proceeded exparte on 18.11.2023. Thereafter, matter was proceeded for exparte Plaintiff's evidence.
EX-PARTE PLAINTIFF EVIDENCE
7. Shri Sunil Kumar, Proprietor of Plaintiff examined himself as PW1 and tendered an affidavit, Ex. PW1/A in his evidence, wherein he reiterated the averments made in the Plaint and relied upon the documents mentioned as follows :-
S. No. Description of documents Exhibits No. Invoice/Bill dated 05.08.2022 1 (incorrectly mentioned as Ex. PW1/1 05.08.2023 in the evidence affidavit) 2 Legal Notice dated 24.04.2023 Ex. PW1/2, 3 Speed Post Receipt dated Ex. PW1/3 and 24.04.2023 and track report of Ex. PW1/3A (Colly.) CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 4 of 12 speed post Courier Receipt dated 4 Ex. PW1/4 and 24.04.2023 and track report of Ex. PW1/4A (Colly.) courier 5 Original Cheque and Original Ex. PW1/5 and Return Memo Ex. PW1/5A (Colly.) 6 Statement of Account Ex. PW1/6 7 GST Certificate of Plaintiff Ex. PW1/7 8 Certificate of Section 65 B Ex. PW1/8 9 Aadhar card of Plaintiff Ex. PW1/9
8. Defendant was proceeded ex-parte & PW1 was not cross-examined.
Thereafter, exparte PE was closed.
9. Final submissions have been heard.
10. I have perused the judicial record and considered the submissions made.
FINDINGS
11. The case of the Plaintiff is that the Defendant had purchased a variety of auto parts from the Plaintiff vide invoice dated 05/08/2022, bearing no. SVP/138/2022-2023 proved as Ex. PW1/1. It is further proved by Plaintiff that pursuant to the raising of invoice, the Defendant made certain part payments on various dates, which is reflected in the ledger account statement CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 5 of 12 of the Plaintiff proved as Ex. PW1/6. It is further the case of Plaintiff that as certain part payments were made in pursuance to the total outstanding amount of Rs. 51,963/-, the outstanding dues of the Defendant against the invoice Ex. PW1/1 is for an amount of Rs. 45,128/-, which the Defendant is still liable to pay to the Plaintiff. It is further averred by Plaintiff that as the Defendant has failed to adhere to the fiscal discipline and defaulted in the payment of the balance amount of the invoice Ex. PW1/1, now he is liable to pay the outstanding amount of Rs. 45,128/- to the Plaintiff as is reflected from Ex. PW1/6.
12. As the Defendant has already been proceeded as ex-parte and PW1 was not cross-examined, the evidence of Plaintiff remained intact, unchallenged and uncontroverted. When the case of the Plaintiff has gone unchallenged, uncontroverted, unrebutted and duly corroborated by the documents exhibited in evidence, this Court has no reason to disbelieve the case of the Plaintiff qua the principal outstanding amount of Rs. 45,128/- as is reflected from the ledger account Ex. PW1/6.
13. Next, with regard to the interest portion of the Plaintiff's claim, it was averred by the Plaintiff that it is entitled to compound interest as per the MSME Guidelines on the principal outstanding amount but as the Plaintiff has failed to prove in his evidence such guidelines, the relief prayed for by it cannot be granted. The Hon'ble Division Bench of the Hon'ble CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 6 of 12 High Court of Delhi in the case of Pt. Munshi Ram & Associates (P) Ltd. Vs. DDA, 2010 SCC Online Del 2444, has held that higher rates of interest, which are against public policy, can be struck down by the Court by finding such rates of interest to be against the public policy. Any Contract, which is against the public policy, is void under Section 23 of the Indian Contract Act, 1872. The said Judgment was also relied upon by the Hon'ble Single Bench of the Hon'ble High Court in case bearing R.F.A. No. 823 of 2004, titled as Shri Sanjay Mittal Versus Sunil Jain decided on 07/12/2018. The Hon'ble Single Bench has granted 9% p.a. interest instead of 18% per annum i.e. 2% per month. Hence, interest @ 9% per annum is awarded to the Plaintiff on the principal outstanding amount.
14. Besides the merits of the suit, the crucial aspects of limitation and territorial jurisdiction of this Court have also been examined. The suit of Plaintiff is within limitation. Secondly, with regard to the territorial jurisdiction of this Court where the Defendant has his place of business beyond the jurisdiction of this Court and no place for the payment of the consideration amount raised through the invoices has been fixed by the parties by way of an agreement, it would be profitable to refer to the judgment of Hon'ble Delhi High Court in case titled as Satyapal Vs. Slick Auto Accessories Pvt. Ltd. AIR 2014 Del 115, by the Hon'ble High Court, where it has been observed:-
"5. The first appellate court has surprisingly and illegally not at all referred to even remotely the CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 7 of 12 detailed analysis and reasoning which has been given by the trial court to hold that the courts at Delhi have the territorial jurisdiction. Since the trial court has written, in my opinion, a very thorough and an excellent judgment, I would like to reproduce the relevant paras of the judgment of the trial court instead of using my words. The relevant paras of the trial court are 19 to 25 and the same read as under:-
"ISSUE NO. 1:
"19. The question to be answered is as to whether this court has no territorial jurisdiction to try and entertain the present suit. The onus to prove this issue was upon the defendant.
20. The defendants have contended that the office/factory of the defendants is situated in Bhiwadi, District-Alwar, Rajasthan and the delivery of the goods was also made at Bhawadi, District-Alwar, Rajasthan at the office/factory of the defendants and therefore no part of the cause of action arose within the jurisdiction of this court. DW 1 has deposed on these lines.
21. There is no doubt the material was supplied by the plaintiff to the defendants at Bhiwadi, District-Alwar, Rajasthan. The same is clear from the invoices Ex. PW1/A and Ex. PW1/B. However even if the material was delivered at Bhiwadi, District-Alwar, Rajasthan it is clear that the material was supplied from the office/factory of the plaintiff situated at Jwala Nagar, Shahdara, Delhi-32 which falls within the jurisdiction of this court.CS SCJ No. 594/230
M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 8 of 12
22. It is a well established principle of law that where, under a contract no place of payment is specified, the debtor must seek his creditor and therefore a suit for recovery is maintainable at the place where the creditor resides or works for gain, because a part of the cause of action arises at that place also with the contemplation of section 20 (c) of the Code of Civil Procedure. Reference may be made to the judgments titled as "State of Punjab V. A. K. Raha" reported as AIR 1964 CALCUTTA 418 (DB), "Jose Paul v. Jose"
reported as AIR 2002 KERALA 397 (DB), "Rajasthan State Electricity Board V. M/s Dayal Wood Works" reported as AIR 1998 ANDHRA PRADESH 381, "Munnisa Begum V. Noore Mohd." Reported as AIR 1965 ANDHRA PRADESH 231 and "State of U.P. v. Raja Ram"
reported as AIR 1966 AllAHABAD 159.
23. In the judgment titled as "State of Punjab v. A. K. Raha" reported as AIR 1964 CALCUTTA 418 (DB) it was clearly held:-
"...........The general rule is that where no place of payment is specified in the contract either expressly or impliedly, the debtor must seek the creditor, see The Eider (1893) P 119 at p. 136, Drexel v. Drexel. (1916) 1 Ch 251 at p. 261, North Bengal, Das Brothers Zemindary Co. Ltd V. Surendera Nath Das, ILR (1957) 2 Cal 8. The obligation to pay the debt involves the obligation to find the creditor and to pay him at the place where he is when the money is payable. The application of the general rule is not excluded because the amount of debt is disputed...."
24. In the judgment titled as Sreenivasa CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 9 of 12 Pulvarising vs. Jal Glass & Chemicals Pvt. Ltd. reported as AIR 1985 Cal 74 it was also held:-
"......In a contract of the nature now under consideration performance of the contract consists not only of delivery of the goods but also of payment of the price. Therefore, cause of action for a suit on breach of such a contract would arise not only where the goods were to be delivered but also where the price would be payable on such delivery....."
It was further held:-
".......9. Therefore, the law continues to remain the same and in a suit arising out of a contract, a part of the cause of action arises at the place where in performance of the contract any money to which the suit relates in payable...."
Adverting to the facts of the present case office/factory of the Plaintiff is situated at Jwala nagar, Shahdara, Delhi-32. No place of payment has been specified in the contract/bills/invoices. The defendants are liable to make the payment for the goods supplied to them. No application was made by the defendants to the plaintiffs for fixing a place of payment and Sec. 49 of the Indian Contract Act cannot apply to the facts of the case. Therefore, the payment was to be made at the office of the plaintiff. Further the purchase order was placed at Jwala Nagar, Shahdara, Delhi-32 and the goods were supplied from Jwala nagar, Shahdara, Delhi-32 Therefore a part of the cause of action definitely arises at Jawala Nagar, Shahdara, Delhi-32. Hence the present suit for CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 10 of 12 recovery of the sale price can be filed before this court as the office of the plaintiff is situated within the territorial limits of the jurisdiction of the court.
25. I therefore hold that this court has the territorial jurisdiction to try and entertain the present suit. This issue is therefore decided in favour of the plaintiff and against the defendants."
(underlining added) "6. I completely agree with the conclusion of the trial court because it is settled law that the debtor has to seek the creditor and since no place of payment was agreed upon, payment would have been made to the seller/appellant who is residing and working for gain at New Delhi. Trial court has also rightly relied upon Section 49 of the Indian Contract Act, 1872 that it was upon the respondent no.1/defendant no. 1 to fix the place of payment and which has not been done, and therefore payment would have been made by the debtor to the creditor at the place of the creditor/plaintiff/appellant. As already stated the first appellate court has not even bothered to refer to the analysis and reasoning of the trial court for holding that the courts at Delhi have jurisdiction. Accordingly, the findings of the first appellate court are set aside and it is held that the courts at Delhi have territorial jurisdiction." (Portions bolded in order to highlight) CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 11 of 12
15. Accordingly, in view of the decision above mentioned, this Court has the territorial jurisdiction to adjudicate upon the present suit between parties.
16. Hence in view of the facts, circumstances and the evidence led by Plaintiff, the suit of the Plaintiff is decreed against the Defendant for a sum of Rs. 45,128/- alongwith simple interest @ 9% per annum to be calculated from the date of filing of the suit till its realization from Defendant. It is ordered accordingly.
17. The Plaintiff is also awarded the costs of the suit.
18. Decree-Sheet be accordingly prepared accordingly by the Reader of the Court. Thereafter, Ahlmad is directed to consign the file to Record-Room after due compliance, as per rules.
Announced in the Open Court on 26.02.2024 (Neeti Suri Mishra) SCJ / RC / North Rohini Court/26.02.2024 It is certified that this judgment contains 12 pages and every page is signed by me.
(Neeti Suri Mishra) SCJ / RC / North Rohini Court/26.02.2024 CS SCJ No. 594/230 M/s Sidhi Vinayak Plastic Vs. M/s Shree Ram Enterprises 12 of 12