Delhi District Court
M/S Delta Air Freight Pvt Ltd Through Its ... vs M/S Lark Laboratories Through Its ... on 2 May, 2024
IN THE COURT OF MS. RAVINDER BEDI
DISTRICT JUDGE (COMMERCIAL COURT)-12
CENTRAL DISTRICT, TIS HAZARI COURTS, DELHI.
In the matter of:-
CS (COMM) No. 2078/2022
M/s. Delta Air Freight Pvt. Ltd
through its Authorized Signatory Mr. Sunil Arora
Office At:
10, Rani Jhansi Road, New Delhi-110055
........Plaintiff
Versus
M/s Lark Laboratories
through its Directors
Office at : SP-1192E, Phase-IV, Indl Area,
Bhiwadi-301019, Rajasthan,
Also At:
A-105/2, Phase-II, Okhla Industrial Area,
New Delhi-110020 (India)
......Defendant
Date of institution of suit : 01.09.2022
Date of final arguments : 15.04.2024
Date of final order : 02.05.2024
Appearance:
Plaintiff represented by Counsel Mr. Arvind Mishra.
Defendant represented by Counsel Mr. Manish Malhotra
CS (COMM) No. 2078/2022
M/s Delta Air Freight Pvt Ltd v
M/s Lark Laboratories Page no. 1/ 24
JUDGMENT
1. Present is a suit instituted by Plaintiff seeking recovery of Rs. 4,60,000/- (Rupees Four Lakhs and Sixty Thousand Only) i.e. the late payment interest charges against the Defendant.
2.(a) To put succinctly, Plaintiff is a company incorporated under the Indian Companies Act 1956, having its registered office at Rani Jhansi Road, New Delhi. Plaintiff is operating as an international freight forwarder and custom clearing agent for consignment for export / import to the abroad and has generated an impressive goodwill in the trade fraternity. The suit is instituted through the Authorised Signatory Mr. Sunil Arora, who is authorised by Board of Directors vide Board Resolution dated 21.01.2020. The Defendant is a registered company.
b) The case of the Plaintiff is that the Defendant had availed the services of Plaintiff for air cargo shipment of goods vide Airways bill no.250-1302-9391 dated 01.02.2018 (of Uzbekistan with destination Kyrgyzstan) and airway bill no. 105- 9100-2586 dated 22.01.2018(with destination Latvia) for the consignee SIA Life Lines on the export Contract terms as C & F (Cost and Freight). Plaintiff raised the air freight charges for such goods consigned to Latvia and Kyrgyzstan vide the Invoices dated 01.02.2018 and 22.01.2018 with total amount of Rs. 6,10,086/- as CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 2/ 24 per the instructions of Defendant.
c) Plaint avers that consignments reached their final destination and goods were duly received by respective consignees. The Defendant also availed the benefits of IGST inputs. Despite the successful handling / delivering of consigned goods by Plaintiff, the Defendant failed to clear the outstanding freight charges as per the Invoices raised by Plaintiff.
(d) The Defendant was liable to make the payment as soon as the goods were dispatched / reached their destination. However it did not pay any amount against the invoices. Plaint avers that despite several requests and personal visits of representatives of Plaintiff, Defendant failed to clear its liability in respect of amount of Invoices amount within stipulated time. Plaintiff was constrained to issue a Legal Notice dated 30.10.2020 upon the Defendant demanding a sum of Rs. 10,12,742/- (Principal and interest). The said notice however went unresponded. Plaint avers that out of the total amount of Rs. 10,12,742/- claimed in Legal notice dated 30.10.2020, Defendant paid an amount of Rs. 6,10,086/- in installments, but has failed to pay the late payment interest of Rs. 4,60,000/- despite several reminders and emails.
e) Plaintiff issued another Legal Notice dated 07.12.2021 upon Defendant asking for late payment interest CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 3/ 24 amount of Rs. 4,60,000/-. However Defendant failed to clear its liability.
f) Plaintiff filed a Pre-Institution Mediation application under Section 12-A of the Commercial Courts Act 2015 (hereinafter as CC Act) before Mediation Cell , Tis Hazari Courts. The Defendant despite service failed to appear before Mediation cell and the same resulted in the issuance of a Non-Starter Report. The instant suit is for the late payment charges accrued vide Invoices dated 01.02.2018 and 22.01.2018 alongwith interest.
g) Plaint avers that the subject matter of the suit is a "Commercial Dispute", as provided under Section 2 (1)(c)(i) of Commercial Courts Act, 2015. Plaintiff in the instant suit has prayed for recovery of interest amount of Rs.4,60,000/- calculated upto 30.10.2021 alongwith late payment interest @ 24 % per annum till its realization.
3.(a) Defendant contested the suit by filing its written statement wherein it contended that the suit was not maintainable. The Defendant company was a registered company with Sh.V.K. Gupta as one of the Directors; that the suit was against the non- existing Defendant M/s Lark Laboratories as mentioned in the memo of parties; that the suit did not fall within the domain of Commercial dispute as envisaged under the provisions of CC Act;
CS (COMM) No. 2078/2022M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 4/ 24 that there was no privity of Contract between parties and neither the Defendant availed services of Plaintiff nor Plaintiff rendered any services to the Defendant; that M/s Sia lifelines, a client and buyer of Defendant had placed Purchase Order dated 09.11.2017 for goods for transit to Latvia and Kyrgyzstan. The only role of Defendant was qua the transit of these goods from its factory at Bhiwadi to the IGI Airport, Delhi. All remaining arrangements were made by M/s Sia Lifelines at their own costs and responsibility.
(b) The Defendant had to assist M/s Sia Lifelines only to the extent of providing all requisite documents for such transit/export of the material/goods from India to their foreign destinations. The international freight forwarder etc was to be maintained by M/s Sia Lifelines only and the Defendant had neither hired the Plaintiff nor was having any liability towards Plaintiff. It was an arrangement between said M/s Sia Lifelines and Plaintiff inter-se, wherein Defendant had no role to play and thus, no liability could be fastened upon Defendant. The suit was thus, bad for mis-joinder and non-joinder of necessary party.
(c) The suit was filed maliciously by Plaintiff against Defendant for making extraneous and illegal gains. Demand of interest @24%p.a. was also excessive and untenable. The Defendant did not receive any Notice or summons required for its CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 5/ 24 participation in the pre-litigation mediation before Mediation Cell. It was denied that Defendant paid only Rs.6,10,086/- in installments out of the total amount of Rs.10,12,742/-. The Defendant denied the receipt of legal notice dated 07.12.2021 having sent by Plaintiff. Defendant denied its liability to pay the amount as well as the interest @24% p.a. Defendant also denied the alleged initiation of Pre-Institution Mediation dated 21.02.2022 and the alleged Non-Starter Report filed by Plaintiff. The Defendant further denied that the subject matter of the suit was a commercial dispute as defined under the provisions of CC Act. Rest of the averments in the plaint were also denied by the Defendant.
4. In rejoinder, Plaintiff reiterated its version in the plaint while refuting contentions of Defendant. By Order dated 17.04.2023, Ld. Predecessor settled the following issues for adjudication :-
i). Whether the present suit is bad for misjoinder or non- joinder of necessary parties ? OPD
ii) Whether the present suit filed on behalf of the Plaintiff is time barred ? OPD
iii) Whether this Court does not have any territorial jurisdiction to try the present suit? OPD
iv) Whether the Plaintiff is entitled to a decree for the CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 6/ 24 suit amount, as prayed for? OPP
v) Whether the Plaintiff is entitled for the pendente-lite and future interest, if so at what rate and for what period?
OPP
vi) Relief.
5. Plaintiff to prove its case has examined Sh. Sunil Arora as PW-1, who has proved the documents i.e. original board resolution dated 21.01.2020 in his favour as Ex. PW1/1; copy of Bill/invoice dated 22.01.2018 no.AIRA-00158 as Ex. PW1/2;
copy of Bill/invoice dated 01.02.2018 no.AIRA-00158 as Ex.PW- 1/3; copy of airway bill no.105-9100 2586 as Ex.PW-1/4; export Invoice dated 15.01.2018 as Ex.PW-1/5; Tax invoice dated 15.01.2018 as Ex.PW-1/6 ; Certificate of origin bearing no.907426 dated 23.01.2018 along-with invoice as Ex.PW-1/7 and Ex.PW- 1/8; Packing list dated 15.01.2018 of quantity of 98,200 boxes as Ex.PW-1/9; Shipping bill for export bearing LEO dated 23.01.2018 as Ex.PW-1/10; Airway bill no.250 1302 9391 as Ex.PW-1/11; Shipping bill for export bearing LEO dated 30.10.2018 as Ex.PW-1/12; Certificate of origin bearing no.907427 dated 23.01.2018 along-with export invoice as Ex.PW- 1/13 and Ex.PW-1/14; Packing list dated 15.01.2018 of quantity of 24,600 boxes as Ex.PW-1/15; copy of Legal notice 05.11.2020 marked as Mark-A; Non-starter report dated 06.03.2021 as Ex.PW-1/18; copy of pre-litigation mediation application vide e-
CS (COMM) No. 2078/2022M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 7/ 24 mails as Mark-C; legal notice 07.12.2021 alongwith postal receipt marked as Mark-C and Mark-D respectively; certificates under Section-65 B of Indian Evidence Act as Ex.PW-1/22.
6. Pertinently, on 05.03.2024, ld. Counsel Mr. Manish Malhotra appearing on behalf of Defendant recorded that Defendant did not wish to lead any evidence. On such request, the evidence of Defendant was closed and the matter was posted for final arguments.
7. I have heard Ld. Counsel for parties and perused the entire record meticulously in the light of relevant statutory provisions of law. I have also looked into the judgment/authorities related upon by parties and my issue wise findings are as under :-
Issue no.2). Whether the present suit filed on behalf of the Plaintiff is time barred ? OPD
8. The onus of proving this issue was upon the Defendant. The Defendant in its written statement had taken the objection of the instant suit being barred by law of limitation. Ld. Counsel for Defendant argued that the suit was time barred as the same pertained to claims in respect of the Invoices raised on 01.02.2018 and 22.01.2018. Ld. Counsel argued that the suit was instituted on 01.09.2022 and was hit by law of limitation.
CS (COMM) No. 2078/2022M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 8/ 24
9. Per contra, Ld. Counsel for the Plaintiff argues that suit is well within limitation since the legal notice dated 30.10.2020 was served on defendant which went unresponded. Ld. counsel submits that plaintiff also received the amount of Rs 6,10,086/- in January 2021. He further relies upon the decision of the Hon'ble Apex Court in Suo Moto Writ Petition (civil) no. 03/2020 " In Re-Cognizance for Extension of Limitation" dated 10.01.2022 whereby limitation period has been extended further from 01.03.2022. Ld. counsel submits that the time taken for proceedings under Section 12A of The CCAct before Pre- Institution Mediation Cell has also to be excluded and thus, the suit is well within limitation.
10. I observe that defendant has taken only faint plea of the suit being barred by law of limitation. Defendant has not brought anything to show as to how the suit is hit by limitation. A mere averment in the written statement that the suit being barred by limitation would not suffice. Further, Hon'ble Apex Court in the matter of Suo Moto Writ Petition (civil) no. 03/2020 " In Re Cognizance for extension of limitation" has held that in cases where limitation would have expired during the period between 15.02.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, further limitation period of 90 days from 01.03.2022 has been provided. In the above said judgment, it CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 9/ 24 is further held that the aforesaid period also stands excluded in computing the period prescribed under Section 12 A of the Commercial Courts Act, 2015. This is further discussed by Hon'ble Delhi High Court in Relaxo Footwears Ltd v XS Brands Consultancy Private Limited and Ors (DOD 01.08.2022) .
11. Having found thus, counting the period from the date of legal notice sent by plaintiff upon defendant, the suit is well within the period of limitation. Thus, the issue stands answered against the defendant and in favour of plaintiff.
Issue no.3). Whether this Court does not have any territorial jurisdiction to try the present suit? OPD
12. The onus to prove this issue was upon the Defendant. Ld. Counsel for defendant argued that the defendant's office did not lie within the territorial jurisdiction of this Court as the defendant company was situated at Bhiwadi, having its office at Industrial Area, Bhiwadi, Rajasthan and had another office at Okhla Industrial Area, Delhi; thus this Court had no territorial jurisdiction to entertain or try the present suit. On the other hand, Ld. Counsel for the Plaintiff argued that the consignments in question were ordered and booked from Plaintiff's office at Rani Jhansi Road which fell within the territorial jurisdiction of this CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 10/ 24 Court and thus, part cause of action had accrued within its jurisdiction.
13. The provisions of Section 20 of the Code of Civil Procedure are being reproduced hereunder:
"20. Other suits to be instituted where defendants reside or cause of action arises. -- Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction
(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution;
(c) the cause of action, wholly or in part, arises."
14. Thus, as per Section-20 of the CPC, where Defendant neither resides nor carries on business nor any part of the cause of action arises within the limits of the jurisdiction of the court, such court has no territorial jurisdiction to try the suit. (Bahrain Petroleum Co. Ltd. Vs. P.K Pappu & Anr., AIR 1966 SC 634). However where clauses (a) and (b) of Section 20 are not applicable, only that court will be competent, where cause of action wholly or in CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 11/ 24 part arises. (ONGC Vs. Utpal Kumar Basu & Ors. (1994) 4 SCC 711; M/s Bhaktawar Singh Bal Kishan Vs. Union of India and others (1988) 2 SCC 293 and Board of Trustees for the Port of Calcutta and Anr. Vs.Bombay Flour Mills P. Ltd. & Anr. (1995) 2 SCC 559).
15. In the judgment of Satyapal Vs. Slick Auto Accessories Pvt. Ltd. (2014) SCC Online Del 998, it is held that where the place of payment is not fixed in the contract/ bill / Invoices, the parties have to follow the general rule that the payment has to be made at the place of the creditor. Where there is nothing to show as to the place of payment, even without following of principle that 'debtor must seek out the creditor', the Court has the jurisdiction to try the suit, where payment is made. Strength can also be drawn from the decision of Milk Food Ltd. vs. Union Bank of India (Manu/DE/8271/2007), in which it was observed that as per general rule, in the absence of a contract to the contrary, a debtor is bound to find the creditor to make payment - the place of payment is where the creditor resides.
16. Given the settled legal position as above and applying to the facts in hand, I find that part cause of action has arisen in favour of Plaintiff within the jurisdiction of this Court. The consignments were booked and ordered from Plaintiff's office at Rani Jhansi Road, New Delhi and Invoices were issued from this office of plaintiff, which falls within the territorial jurisdiction of this Court. Hence, this Court has territorial jurisdiction. The issue stands decided against the CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 12/ 24 defendant and in favour of plaintiff.
Issue no.1). Whether the present suit is bad for misjoinder or non-joinder of necessary parties ? OPD
17. The onus to prove this issue was upon the Defendant . Ld. counsel for defendant during final submissions attempted to contend that the burden of proof qua issue no. 1 to 3 had to be upon the plaintiff and the issues framed by Ld. Predecessor suffered from misplaced burden of proof. He further contended that it was for plaintiff to prove his case by positive evidence. He contended that the suit was filed by plaintiff against the defendant- a wrong entity while not joining the proper and necessary parties to the suit. He further drew my attention to the authority letter and the competency of the witness of plaintiff i.e. PW-1 Sunil Arora to institute and proceed with the matter. Ld. counsel for Defendant in support of his contentions has relied upon following judgments:
i) Madan Pal Singh v State of UP & ors; MANU/SC/0012/2000 equivalent citation AIR 2000 SC 537
ii) Maghar Singh v T.K Industries, Ludhiana; 1974 (47) FJR 209
iii) Schemenger GMBH and Company Leder v Saddler Shoes Pvt Ltd; MANU/TN/3885/2010
iv) Hotel Ornate (Nilgiri) Pvt Ltd v Lakshmipriya Nagendran; MANU/TN/1324/2023
v) Shiv Dayal Kapoor & ors v UOI & ors; MANU/PH/0151/1963 equivalent citation: AIR 1963 P & H 538
vi) Rangammal v Kuppuswami & ors ; MANU/SC/0620/2011 equivalent CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 13/ 24 citation: AIR 2011 SC 2344
vii) Om Prakash v Amit Chaudhary & ors; CM(M) 282/2019 & CM Appl. 7818/2019 Delhi High Court and
viii) M/s Gauhati Roller Flour Mills Ltd v Smt Premoda Medhi & ors;
RSA/35/2012 Gauhati High Court.
18. Ld. counsel for plaintiff argues that the issues no. 1 , 2 and 3 were framed only on the basis of the preliminary objections of the defendant to the suit and thus the plea of misplacing burden of proof is completely baseless and merits rejection. Ld. counsel submits that not an iota of evidence in the form of scrap of paper is produced by defendant despite opportunity and the pleas of competency of PW-1 or other pleas raised at final stage on which parties were not at variance, cannot be allowed to be raised.
19. It is undoubtedly true that the onus is on the plaintiff to prove his case on the basis of material available and it cannot rely upon the weakness or absence of defence to discharge onus. A suit is tried on the basis of pleadings of parties and burden of proof is on the party asserting the affirmative or negative of a certain fact. The concepts of onus probandi and the Factum Probans include the underlying principles of burden of proof. Onus probandi is a general rule requiring a person asserting the positive to prove it. The onus probandi is on the party seeking to strengthen his case with a specific fact, which it is aware of.
CS (COMM) No. 2078/2022M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 14/ 24
20. I find the submission of defendant alleging misplaced burden of proof to be completely devoid of merit. The same is baseless and contrary to the basic principles of burden of proof. The judgments relied upon by Defendant are distinguishable and thus inapplicable to the subject matter. The pleadings would demonstrate that the defendant had taken a categorical defence that the suit was bad for mis-joinder and non-joinder of necessary parties. The Defendant also alleged that it had no liability whatsoever in respect of claims made by Plaintiff and the necessary party M/s Sia Lifelines was not impleaded by Plaintiff. However, the Defendant chose not to come forth with any evidence. Ld. counsel for defendant recorded that the defendant did not wish to bring its evidence. In such a scenario, it remaind inexplicable as to how the suit was hit by principle of mis-joinder or non-joinder of necessary parties. The issue remained unestablished and therefore stands answered against Defendant and in favour of Plaintiff.
Issue no.4). Whether the Plaintiff is entitled to a decree for the suit amount, as prayed for? OPP and Issue no.5). Whether the Plaintiff is entitled for the pendente-lite and future interest, if so at what rate and for what period? OPP
21. The onus of proving the issues was upon the Plaintiff.
CS (COMM) No. 2078/2022M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 15/ 24 Plaintiff examined Sh. Sunil Arora - AR as PW-1 who deposed on similar lines as in the Plaint. PW-1 stated that Plaintiff was a Freight Forwarding Agent/ Custom Clearing Agent for consignment of export/import to various countries and Defendant had took the services of Plaintiff for air-cargo shipment of goods vide airway bill dated 01.02.2018 as Ex. PW-1/3 of Uzbekistan Airways with destination as Bishkek, Kyrgistan and airway bill dated 22.01.2018 as Ex. PW1/2 of Finn Air with destination as Latvia. PW stated that consignments reached their final destination and goods were duly received by the respective consignees. The Defendant also availed the benefits of integrated GST inputs. PW-1 stated that Defendant did not pay Freight Charges to the Plaintiff against the Invoices raised. PW-1 stated that the Plaintiff served a Legal notice as Ex. PW- 1/16 upon the Defendant calling them to make payment of Rs. 10,12,742/- along with interest @ 24 % per annum, which was not responded to by the Defendant.
22. Ld. Counsel for Defendant contended that there was no privity of contract between parties. Neither the Defendant had availed services of Plaintiff nor Plaintiff rendered the alleged services. Ld. Counsel contended that M/s Sia Lifelines were defendant's clients and the only role of Defendant was to deliver the said material from its factory at Bhiwadi to IGI Airport, Delhi and further arrangements for transit of said material to the final destinations i.e Latvia and Kyrgistan were to be made by M/s Sia Lifelines only. The role of Defendant was only to assist M/s Sia CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 16/ 24 Lifelines to the extent of proffering the requisite documents for such transit and Defendant was not liable for any payment of charges of Freight Forwarding. Ld. Counsel drew my attention to the cross-examination of PW-1, who was unable to even tell the address or location of Defendant's office in Delhi. Ld. Counsel stated that PW-1 was unable to tell the person with whom Plaintiff company had such dealings.
23. On the other hand, Ld. Counsel for Plaintiff by referring to the Invoices and E-mails submitted that Defendant did not deny having availed the services of Plaintiff against which the Defendant raised the Invoices. He argued that the Invoices constituted a complete Contract between the parties and provided payment of interest @ 24% per annum on the delayed amount. He referred to the email dated 18.02.2021 annexed with written statement, as per which the Defendant was informed about the payment made to the Plaintiff by its sender. The same showed liability of defendant. The e-mails Ex. PW1/19 would further support that initial payments were made by defendant from S.S Associates i.e an Indian company on behalf of Lark Laboratories. Ld. Counsel has argued that the same evidenced the fact that the payment was made on instructions of the Defendant. Ld. Counsel explained the INCOTERMS, 2020 introduced by International Chamber of Commerce (ICC) in respect of C&F Contracts. Ld. counsel has placed reliance upon the decisions of Phulchand CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 17/ 24 Export Ltd v Parito Manu/SC/1217/2011, Shanghai Electric Group Co. Ltd v DCIT Circle-3, MANU/ID/0231/2017, Vikrant Tyres Ltd and Ors v Techno Export Foreign Trade Company Ltd ors.
24. After having mulled over the entire evidence and the documents proved by Plaintiff, these would amply demonstrate the liability of Defendant, who through M/s SIA Lifelines (defendant's client/Buyer) had transited the material to be delivered to final destination (ie Latria and Krygistan respectively). The defendant did not dispute his relationship with S.S Associates or the part payments made to plaintiff from S.S Associates-an Indian Company of defendant. Undisputedly, the consignment reached their final destination and received by respective consignees. It is also not disputed that defendant had availed their GST Inputs, but failed to pay the freight charges to the plaintiff. The defendant's receipt of freight charges from the buyer is evident from the export Invoices, which is Cost and Freight Contract (C & F contract).
25. The C&F Contract is a well understood term in commerce and in law. The Hon'ble Apex Court in the decision of the Phulchand Exports Pvt. Ltd (supra) has observed that such Contract contemplates the carriage of goods by sea and is the most common form of shipping contract, for the price which the buyer CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 18/ 24 has to pay, together with transit and freight to the port of destination. Under such Contracts, the seller performs his obligations by shipping at the time specified in the contract, goods of the Contractual description in a ship bound for destination. In other words, cost and freight means that the seller pays for transportation to the port of the shipment, loading and freight. The buyer pays for transportation the good from the port of destination to his factory.
26. Furthermore, INCOTERMS Rules are essential part of the trade and are incorporated in the contracts for sale of goods worldwide. INCOTERM Rules provide guidance to the Importers, exporters, transporters, Insurers and lawyers of International trade. There are many International INCOTERMS adopted by the International Chamber of Commerce (ICC). One such term is (CFR-Cost and Freight) as per which the seller(exporter) has to pay the cost and freight to bring the goods to the named port of destination. The CFR terms require the seller to clear the goods for export and are used only for sea & inland waterway transport as per INCOTERMS Contract. Reliance can be placed upon Vikrant Tyres Ltd (supra) and Phulchand Export Ltd (supra).
27. The Record sufficiently establishes the fact that the defendant received the freight charges for transiting the material through its client M/s SIA Lifelines and received freight charges CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 19/ 24 from buyer as stipulated in the Contracts i.e Export Invoices. However defendant failed to pay the freight charges to plaintiff. An e-mail dated 18.02.2021 (Annexure D-4) filed alongwith the WS clearly shows that the defendant was informed about the part payment made to the plaintiff. It mentions the part payment of Cargo Agent M/S Delta Air Freight was made and the balance would have to be cleared in next week. Also the trail of e-mails would suggest that it was only the liability of the defendant to make payment of Rs. 4,60,000/-. The part payment of Rs. 6,10,086/- in respect of freight charges was paid in the month of January, 2021.
28. The defendant did not bring forth any evidence in support of the plea that he was not a privy to the transaction, while he admits in the written statement about the fact that M/s SIA Lifelines were their clients. The defendant also confirmed the transaction between the parties by not refuting the fact of availing the benefit of IGST against the Invoices in question. If there was no transaction between the parties, there was no occasion for sender of the e-mail dated 18.02.2021 informing the defendant about the payments being made to the plaintiff. Even otherwise, a perusal of the written statement of the defendant would indicate that the same contains bald denials of the material facts. The same is contrary to Order 8 Rule 3A CPC as amended by The CCAct, 2015, which prescribes the manner in which a defendant has to CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 20/ 24 deny the averments of the plaintiff in the plaint. Defendant did not come up with his own version as per mandate of Order 8 Rule 3A(3) CPC, The defendant made only simple and omnibus denial of the facts and in view of such evasive denials, the averments of the plaintiff are deemed to be admitted by the defendant. The defendant also remained silent in respect of availing benefit of GST inputs against the amount, which is a deemed admission on its part.
29. Furthermore, plaintiff adduced evidence in respect of the transaction in question and proved the Invoices. The cross- examination of PW-1 suggests that the same primarily revolved around the ignorance of PW-1 as to the place, location of office of defendant. Nothing contrary or contradictory could be elicited from this witness in respect of transaction. PW-1 negated the suggestion that the part payment was received by PW-1 from M/s SIA Lifelines directly. PW-1 also stuck to his stand that freight charges were received from M/s SS Associates on behalf of Lark Laboratories vide e-mail Ex. PW1/19.
30. Ld. Counsel for plaintiff argued that an adverse inference could be drawn against Defendant as the Defendant failed to file reply to the Demand Notices dated 30.10.2020 and 07.12.2021 nor they refuted the averments of demand of amount based on Invoices.
CS (COMM) No. 2078/2022
M/s Delta Air Freight Pvt Ltd v
M/s Lark Laboratories Page no. 21/ 24
31 I find that Plaintiff has established the factum of
service of Notices upon Defendant and there is a presumption of deemed service as per law. In Kalu Ram Vs. Sita Ram, 1980 RLR (Note) 44, it is held that where the plaintiff before filing a suit makes serious assertions in a notice to the defendant, the defendant must not remain silent by ignoring reply. If he does so, an adverse inference for the same may be drawn against him. Similar is the observation of Hon'ble Delhi High Court in Metropolis Travels & Resorts (I) Pvt. Ltd. Vs. Sumit Kalra & Anr. (DOD as 07.05.2002) and upon Dharampal Arora (Shri) Vs. M/s. Share Tips & Ors (DOD as 22.03.2010). Thus an adverse inference has to be drawn against Defendant that it had nothing to say in reply by refuting the contents of Notice.
32 Defendant has failed to come up with anything in rebuttal to prove the allegations raised in defence. In view of my findings as above, I hold that the Plaintiff company has been successful in establishing its claim for recovery of interest amount against Defendant.
33 On the aspect of interest on the amount claimed, Ld. Counsel for plaintiff submits that the Invoices are 'written contracts' as per settled law and therefore claim is made for an interest @ 24% p.a. on the amount before the institution period CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 22/ 24 alongwith interest pendente-lite and future till realization.
34 The tax Invoices contain a Clause for payment of interest at the rate mentioned therein. In the absence of any contra evidence, I am of the view that plaintiff is entitled for the contractual rate of interest for the reason of the transaction between parties being a 'Commercial' one, upto the date of filing of the suit. Plaintiff is thus entitled for an interest @ 24% p.a. from 01st, March 2018, (i.e from second invoice) upto the date of filing of suit alongwith simple interest @ 8% pendente-lite and future till realization.
realization [KLG Systel Ltd Vs. Fujitsu ICIM Ltd. (DOD :
23.04.2001); Beacon Electronics Vs. Sylvania and Laxman, 998 (3) Apex Decision Delhi 141 ; Liugong India Pvt Ltd Vs. Yograj Infrastructure Ltd & Ors (DOD : 08.02.2018) and Corporation Bank Vs. M/s. Rama Industries & Ors (DOD : 12.05.1998)].
Both issues stand answered in favour of plaintiff and against the defendant.
Relief 35 From the discussion as adumbrated herein-above, I hereby pass the following:
a) a decree for a sum of Rs. 4,60,000/- (Rupees Four Lakhs Sixty Thousand Only) is passed in favour of Plaintiff and against Defendant alongwith interest @ 18% p.a. from 01st March 2018, (i.e from second invoice) upto the date of filing of suit alongwith simple interest @ 8% pendente-lite and future till its CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 23/ 24 realization.
b) The costs of the suit alongwith pleader's fee is also awarded in favour of the plaintiff and against the defendants.
Decree-sheet be prepared and file be consigned to Record Room after due compliance.
Digitally signed by RAVINDER BEDI RAVINDER Date: BEDI Announced in open 2024.05.02 15:49:59 +0530 court on 02.05.2024 (Ravinder Bedi) District Judge (Commercial Court)-12 Central District, Tis Hazari Courts/Delhi CS (COMM) No. 2078/2022 M/s Delta Air Freight Pvt Ltd v M/s Lark Laboratories Page no. 24/ 24