Delhi District Court
M/S R.D. Plast Pvt. Ltd vs M/S Invoke Medical System Pvt. Ltd on 29 November, 2023
IN THE COURT OF SH.AJAY GUPTA
DISTRICT JUDGE (COMMERCIAL)05
TIS HAZARI COURTS, WEST: DELHI
Case No. CS(COMM)/66/2020
CNR No. DLWT010079882018
M/s R.D PLAST PVT LTD
Registered office at
A13/3, PhaseI, Naraina Industrial Area
New Delhi110028
Through its Head, Finance & Accounts
Sh. Prabhakar Ganeriwala
.....Plaintiff
Versus
M/s INVOKE MEDICAL SYSTEM PVT.LTD.
Registered office at
Oppopsite Rastogi Inter College
Aishbagh, Lucknow (U.P.)
Through its Director, Sh. R.K.Pandey
Second Address
M/s INVOKE MEDICAL SYSTEM PVT.LTD.
11A/173, Vrindavan Yojana
Lucknow (U.P.)
Corporate Office:
M/s INVOKE MEDICAL SYSTEM PVT.LTD.
13/66, 2nd Floor, Subhash Nagar
Delhi
.....Defendant
Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 1/50
Date of institution of suit : 30.08.2018
Arguments heard/order reserved on : 03.11.2023
Date of decision : 29.11.2023
SUIT FOR MONEY RECOVERY OF RS. 1,97,30,604/
JUDGMENT:
1. Plaintiff company has filed the present suit mainly on the basis of the following averments:
(i) that plaintiff company is engaged in the business of manufacturing of T. V. installations gadgets/brackets, hospital items for patient privacy systems, nurse call systems and also into the installations work on job/contract basis.
(ii) that defendant company is engaged in the business of erection, renovation of buildings and constructions work and they are having their registered office at Lucknow and corporate office at Delhi.
(iii) that defendant company through its Director Sh. R. K. Pandey executed a Memo of Understanding dated 23.03.2011(hereinafter referred as MOU) in the office of plaintiff at Delhi. The said MOU was executed for supply of material and execution of work at ESIC Hospital, Babu Nagar, Ahmedabad, Gujarat(hereinafter referred as ESIC Hospital/Hospital Site) by the plaintiff on behalf of the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 2/50 defendant for the Nodal agency National Buildings Constructions Corporations Limited (hereinafter referred to as NBCC/Nodal Agency). NBCC is the Nodal Agency and defendant is the Executing Agency and plaintiff is the Sub Executing Agency. The defendant on behalf of NBCC assigned the job work to the plaintiff for supply of material and execution of work at ESIC Hospital.
(iv) that plaintiff supplied the material and executed the work at the hospital site as per terms and conditions of the MOU. The plaintiff supplied the material at the hospital site through the following detailed invoices which were duly acknowledged by the defendant: Invoice No. Dated Amount 053 20.04.2011 18,47,067.00 091 20.04.2011 51,71,788.00 092 20.04.2011 22,10,406.00 075 28.04.2011 81,27,096.00 395 25.05.2011 12,37,450.00 TOTAL 1,85,93,807.00
(v) that after aforesaid supply plaintiff further supplied the material worth Rs.13836/. Thus, till 06.03.17 plaintiff supplied the defendant the material to the tune of Rs.1,86,07,643/ (Rupees One Crore Eighty Six Lacs Seven Thousand Six Hundred Forty Three only) out of which till date defendant has paid only Rs.75,59,836/(Seventy five lacs fifty nine thousand eight hundred thirty six only).
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(vi) that on the persistent demands and requests of plaintiff and email dt. 27.02.2017, on dt. 06.03.2017, the defendant deposited a sum of Rs.46000/ in the bank account of plaintiff receipt of which was duly acknowledged by the plaintiff through email dt 27.03.2017. Thereafter, the defendant has not paid any amount and as per Statement of Account for the period w.e.f.01.04.10 to 20.03.17 pertaining to the account of defendant, a sum of Rs.1,10,47,807/(Rupees One Crore ten lacs forty seven thousand and eight hundred seven only) is outstanding against the defendant.
(vii) that plaintiff requested the defendant to pay the aforesaid amount but defendant did not make the payment. Plaintiff also requested the NBCC officials to advise the defendant to make the payment but of no avail. As such, plaintiff got issued a legal demand notice dt. 31.03.17 at the Lucknow and Delhi offices of the defendant which were duly served upon the defendant. Copies of the said legal notice were also sent to the NBCC.
(viii) that plaintiff is entitled to the aforesaid outstanding amount alongwith 12% p.a. interest which comes to Rs.86,82,797/(Eighty six lacs eighty two thousand seven hundred ninety seven only).
(ix) that initially the present suit was filed before Hon'ble High Court on 01.02.18, and subsequently on 17.04.18, the plaint was received back by the Ld. Counsel for the plaintiff for Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 4/50 removal of objections but in the meantime the pecuniary jurisdiction of District Courts in regard to Commercial Matters was enhanced to Rs. 2 Crore and Hon'ble High Court directed that Registry will not accept the Commercial Suits of less than Rs.2 Crore Valuation. Thus, it is averred that this court has jurisdiction to entertain and try the present suit.
(x) that in regard to the territorial jurisdiction of this court it has been submitted that as per the invoices the dispute, if any is to be subjected to Delhi Jurisdiction only. Further it is stated that MOU was executed at Delhi and Defendant also has their Corporate Office at Delhi.
(xi) that on the basis of aforesaid averments plaintiff has prayed that a decree for the recovery of Rs.1,97,30,604/ (Rs.One Crore ninety seven lac thirty thousand six hundred four only) alongwith 12% p.a interest may be passed and they may also be awarded the cost of the suit.
2. Defendant contested the present suit mainly on the basis of the following averments made in the preliminary objections as well as reply on merits:
(i) that the present suit is liable to be rejected in view of provisions of Order 7 Rule 11(a) and (d) CPC. It is submitted that present suit is highly belated and barred by limitation.
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(ii) that the present suit is liable to be rejected as it has not been filed against the proper and necessary party. The plaintiff has filed the present suit against M/s Invoke Medical Services (P) Ltd, however, correct name of the defendant company is M/s Invoke Medical System Pvt. Ltd, thus, the present suit is liable to be rejected. Before discussing the other averments of written statement, it is pertinent to specify certain proceedings of the present case related to the aforesaid objection. After the defendant raised the aforesaid objection, plaintiff had filed an amendment application for correcting the name of the defendant company and vide order dt. 13.02.2020, this amendment was allowed and amended plaint having the correct name of the defendant company was taken on record. Defendant was given opportunity to file written statement to the amended plaint, however, despite several opportunities they failed to file the same. Hence, the averments made in their written statement which was filed to the original plaint are being discussed here. Even otherwise, in the amended plaint no other amendment except the change of name of the defendant company was made.
(iii) that suit of the plaintiff is liable to be rejected for non supply of legible copies of the documents by the plaintiff.
(iv) that this court doesn't have territorial jurisdiction to entertain the present suit and the same is liable to be returned. It is stated that Registered Office of the defendant is at Lucknow Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 6/50 and they are doing their business and work for gain at Lucknow and no cause of action arose at Delhi. It is stated that all the transactions between the plaintiff and defendant took place at Lucknow and no part of the same took place at Delhi. Neither any meeting nor any transaction took place at Delhi. Defendant neither placed any order at Delhi nor did defendant make any payment to the plaintiff at Delhi against the material supplied by the plaintiff.
(v) that suit of the plaintiff is not maintainable as the same has not been instituted by a proper person as Sh. Prabhakar Ganeriwala is neither conversant with the facts of the case nor having authority to sign, verify, file and institute and prosecute the present suit.
(vi) that the suit of the plaintiff is not maintainable as the same has been filed on the basis of false, fabricated and manipulated documents. Plaintiff has distorted facts of the case and has concocted a story to harass the defendant.
REPLY ON MERITS:
(vii) that while replying on merits the defendant has denied that they are engaged in the business of renovation and erection of buildings and constructions work etc. It is stated that they only deals in the medical equipments and works related to the same.
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(viii) that in regard to the MOU it is stated that the MOU dt. 23.03.11 is false and fabricated. Plaintiff has manipulated and fabricated the MOU with false and frivolous contents. In order to specify the exact stand of the defendant in regard to the MOU, it is necessary to reproduce the contents of para no.5 and 6 of the written statement which are as follows: "5. That the contents of para no.5 of the plaint are wrong and denied. The alleged Memo of Understanding dated 23.03.2011 is false and fabricated. Let the plaintiff be put to strict proof thereof. It is submitted that the plaintiff has manipulated and fabricated its alleged MOU with false and frivolous contents. It is further submitted that initially there has been discussion between plaintiff and defendant but due to the conduct of the plaintiff as plaintiff directly started approaching the Nodal Agency i.e. NBCC and when it came to the knowledge of the defendant then the defendant not inclined to do business as per contract and rather purchased some of the material from the plaintiff and even made the huge payment in between without even getting the all material from the plaintiff.
6. That the contents of para no.6 of the plaint are wrong and denied. It is denied that the plaintiff is the sub executing agency. It is further denied that the defendant for an on behalf of Nodal Agency N.B.C.C Limited has assigned the job work to the plaintiff for the supply of the material and execution of work at ESIC Hospital, Bapu Nagar, Ahmedabad, Gujarat. It is submitted that initially there was a discussion between the plaintiff and defendant regarding the said work but later when plaintiff directly starting negotiating with the Nodal Agency and due to the said unprofessional conduct of the plaintiff, defendant has not inclined to do business with the plaintiff and it has been came into the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 8/50 knowledge of the defendant that plaintiff are giving huge prices to government for the said product and that violates the law of maximum selling price which in turn would be a huge loss to nation and tax payers of country. It is pertinent to mention here that plaintiff are dealing in the products are selling at very huge price specially in government organization and that violates the law of maximum selling price and defendant on various occasions instructed plaintiff to stop the same tactics and defendant reserves the right to sue the plaintiff for the alleged illegal business due to which the plaintiff has filed the present suit in order to harass and pressurize and extort undue money from the defendant".
(ix) that defendant has denied the assertion of plaintiff regarding supply of goods. Defendant has denied that plaintiff supplied the goods and executed the work at hospital site as per terms and conditions of MOU. Defendant has also denied the receipt of the goods through the invoices as mentioned in para no.7 of the plaint and claimed these invoices to be forged. It is stated that plaintiff had defaulted and had not delivered the goods as per agreed understanding and requirements of defendant. The material used and the printing job done by the plaintiff was sub standard and not as per the quality desired by the defendant. It is further stated that initially the plaintiff supplied the material as per requirement of defendant but after winning confidence of the defendant, plaintiff started sending sub standard and inferior quality material. The client/customers of the defendant who received the substandard and inferior quality material complained about the same with the defendant and rejected the said material. Defendant informed the plaintiff Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 9/50 about the same and requested them to replace the same with high quality material as per the works but plaintiff refused to replace the same but assured for not charging the defendant for the same, however, they did not keep their promise and started harassing the defendant. Defendant requested the plaintiff to visit their Lucknow office to resolve the issue but they refused to meet the defendant as they knew that they are wrong and they did not want to face the defendant.
(x) that plaintiff had supplied some material and charged huge amount of Rs.7500000/(Rs.Seventy five lac only) and when defendant came to know about the huge prices charged by the plaintiff, then plaintiff informed them that they are charging very high for Government projects. Thus, defendant gave them a strict warning whereupon plaintiff started directly approaching the Nodal Agency and after knowing the same defendant asked plaintiff to stop these illegal tactics else a case for violating the maximum selling price law will he filed against them. Defendant also requested the plaintiff to refund the huge amount charged by them but instead plaintiff has filed the present suit which is based upon a concocted story and fabricated documents.
(xi) that defendant has denied the further supply of material worth Rs13836/. Defendant has also denied the payment of Rs.75,59,836/. It is stated that till date defendant has only paid Rs.75,00,000/ which was also agreed by the plaintiff to refund.
Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 10/50 It is stated that defendant had last transaction with the plaintiff in the year 2011 and thereafter no transaction was ever done by the defendant with the plaintiff.
(xii) that defendant has denied the assertions of plaintiff regarding request of plaintiff to the defendant through email dt. 27.02.17 for making the payment. Defendant has further denied that they deposited Rs.46,000/ on dt. 06.03.17 in the bank account of plaintiff and this payment was acknowledged by the plaintiff through another email. It is stated that plaintiff has concocted the story of deposit of Rs.46000/ in order to come under the limitation.
(xiii) In regard to the outstanding balance amount claimed by the plaintiff, the defendant has made the following averments in para no.10 of their written statement: "10.That the contents of para no.10 of plaint are wrong and denied. It is vehemently denied that as per books of accounts maintained by the plaintiff in regular course of business the total outstanding amount due from the defendant comes to the tune of Rs.1,10,47,807/. It is submitted that the alleged claim of the plaintiff is false, fabricated and baseless. It is further submitted that the plaintiff has manipulated and fabricated its alleged account Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 11/50 books with false and frivolous transactions".
(xiv) that defendant has denied that plaintiff had duly executed the work and supplied the material to the defendant at the hospital site. It is stated that when the plaintiff had supplied the less material, defendant had promptly informed the plaintiff and they had assured to set off the amount. It is stated that plaintiff did not replace the material and defendant got the said work done and supplied the material to its customer. The customer of defendant neither gave payment of the rejected material nor any further orders to the defendant due to which defendant suffered huge financial loss as well as loss of reputation. It is submitted that nothing is due from the defendant to the plaintiff and on the basis of these averments defendant has sought dismissal of the present suit.
3. In their replication, plaintiff has disputed the entire defence taken by the defendant regarding the supply of inferior quality of goods as well as other assertions regarding promise of plaintiff for return of the amount received by the plaintiff. Plaintiff has denied all the averments made by the defendant for disputing the claim of the plaintiff and plaintiff has reiterated their claim. Plaintiff has claimed that their suit is well within limitation and reiterated that Delhi court has jurisdiction to entertain the present suit.
4. From the pleadings of the parties, following issues Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 12/50 were framed after completion of the proceedings:
1.Whether the plaintiff is entitled to recover Rs.1,97,30,604/ from the defendant? OPP
2.Whether the plaintiff is entitled to recover interest, if yes, at what rate and for what period? OPP
3.Whether the suit is barred by limitation? OPD
4.Whether this court lacks territorial jurisdiction to try the matter? OPD.
5.Relief.
5. In order to prove their claim plaintiff examined their authorized representative Sh. Prabhakar Ganeriwala (PW1) as their sole witness. PW1 led his evidence through his affidavit Ex PW1/A. During his evidence plaintiff/PW1 brought on record the following documents:
(i) Resolution dated 07.04.2017 as Ex.PW1/1
(ii) Copy of certificate of incorporation marked as Mark A (referred as Ex.PW1/2 in Ex.PW1/A)
(iii) Proof of registered office and corporate office of defendant marked as Mark B (referred as Ex.PW1/3 in Ex.PW1/A).
(iv) The MOU dated 23.03.2011 as Ex.PW1/4
(v) The duplicate/second copy of invoices as Ex.PW1/5
to Ex.PW1/9
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(vi) Email dated 27.02.2017 as Ex.PW1/10
(vii) Email dated 27.03.2017 as Ex.PW1/11
(viii) Certified copy of statement of account in respect to the outstanding amount against the defendant for the period from 01.04.2010 to 20.03.2017 as Ex.PW1/12
(ix) Copy of Legal demand notice and registered postal receipts as Ex.PW/13 and Ex.PW1/14.
(x) Consignment tracking reports dated 19.04.2017, 20.04.2017 and 21.04.2017 pertaining to the legal notice as Ex.PW/15 to Ex.PW1/19
(xi) Tabular Chart of the interest claimed by plaintiff which was filed alongwith the amended suit as Ex.PW1/19A.
6. In order to prove their defence, the defendant also examined their authorized representative Sh. Sanjay Pal (DW1) as their sole witness. DW1 also led his evidence through his affidavit Ex DW1/A. Besides, DW1 also brought on record the Board Resolution by virtue of which he was authorized as DW1/1.
7. After completion of evidence, written arguments were filed by Ld. Counsel for both the parties. I have heard arguments addressed on behalf of both the parties and gone through the record of the case as well as written arguments filed by the Ld. Counsels for the parties. My issue wise findings is as under: Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 14/50 ISSUE NO.1 Whether the plaintiff is entitled to recover Rs.1,97,30,064/ from the defendant? OPP 7.1 The onus to prove the issue no.1 was on the plaintiff. For proving this issue plaintiff was required to establish the following elements on record:
(i) That plaintiff entered an MOU (Ex.PW1/4) with the defendant to supply the requisite material at ESIC Hospital, Babu Nagar.
(ii) That in pursuance to the said MOU plaintiff supplied the requisite material at the aforesaid hospital site through the invoices relied upon by the plaintiff as well as specified in their pleadings.
(iii) That defendant initially made part payment of Rs.75,00,000/ (Rs.Seventy five lac only) and subsequently paid Rs. 59,836/(Rs. Fifty nine thousand eight hundred thirty six only).
7.2 Plaintiff has claimed that the MOU Ex PW1/4 was executed between plaintiff and defendant company for supply of medical equipments and execution of work at ESIC Hospital, Babu Nagar, Ahmedabad, Gujarat. As per plaintiff, the NBCC had assigned the said job to the defendant and defendant had further assigned this job to the plaintiff company through the MOU (Ex PW1/4). In their written statement, defendant has not denied the execution of the said MOU but has claimed that firstly, the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 15/50 MOU has been fabricated and manipulated by the plaintiff with false and frivolous contents and secondly, it was never acted upon. The MOU was brought on record by PW1 as Ex.PW1/4 and signing of this document on behalf of defendant has not been denied. During his cross examination, DW1 has admitted that this MOU bears the signature of their Managing Director Sh. Rakesh Kumar Pandey. Thus, signing of this MOU has not been disputed by the defendant and entire endeavour of the defendant has been to put forth their defence and establish that this MOU was signed at the time of initial discussion, however, no action was taken in pursuance to this MOU by the parties. As such, as per defendant this MOU had never taken the shape of a final contract. In this regard, one of the questions put by Ld. Defence counsel to the PW1 is relevant which reads as under: "Question: You directly approached the customer of defendant i.e. NBCC to purchase the material from the plaintiff company directly after signing the MoU with the defendant. What have you to say?
Answer: No. It is incorrect. Voltd: All the material was supplied to the defendant only as per the invoices placed on record".
7.3 Though the defendant has made all effort to deny the establishment of contractual relationship with the plaintiff through MOU but this particular cross examination clearly shows that defendant has categorically admitted the execution of the MOU for supply of the goods at the hospital site on behalf of the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 16/50 defendant. As such, under these circumstances it is to be seen whether both the parties acted further in pursuance to this MOU or not.
7.4 According to the claim of plaintiff, it had supplied the requisite material to the defendant at the hospital site through invoices Ex PW1/5 to PW1/9 (besides the other supply of material of Rs.13836/) and the said material was duly acknowledged by the defendant. Defendant has denied the receipt of the goods through the said invoices, however, admitted that there was an understanding between the parties regarding supply of material. As per defendant, plaintiff had supplied some material but firstly same was overpriced and secondly, same was of substandard quality and was not as per the terms agreed between the parties. As far as the defence of overpricing and inferior quality same will be dealt with a little later as now firstly, it is to be seen as to what was the contract between the parties and what was the material supplied and where the plaintiff had defaulted. According to the plaintiff, in pursuance to the MOU, they had supplied the requisite material through the aforesaid invoices which was duly acknowledged by the defendant, though the defendant has denied the supply of the material through the aforesaid invoices but admitted supply of the material by the plaintiff. Defendant has claimed that the invoices relied upon by the plaintiff are forged and fabricated. Defendant has also claimed that the impression of rubber stamp on these invoices is also not of their company. The Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 17/50 claim of the plaintiff is not only supported by the said bills and also on the basis of the substantial amount of part payment (Rs.75,00,000/) made by the defendant, therefore, it is clear that plaintiff has discharged the initial burden of establishing the transaction between the parties through the said factors. Therefore, under these circumstances and especially, because it is defendant who has claimed these invoices as forged and fabricated in view of the settled provisions of Order 6 Rule 4 CPC, the defendant was not only required to plead but also required to prove the forgery, however, except the bald assertion, no evidence has been led by the defendant in this regard. Thus, in the absence of any relevant evidence, the invoices relied upon by the plaintiff cannot be called to be forged and fabricated. In this regard, this court is supported by the Judgement 2017(3) AD (Delhi) 211, Shweta & Anr Vs. Vimal Kumar.
7.5 Plaintiff has taken a specific stand about the transactions held between them. Plaintiff has specified as to how the contractual relationship was established between the parties and also about as to how the transactions took place between them. Plaintiff has brought on record the MOU, invoices as well as audited statement of accounts containing the details of the all the transactions between the parties. The defendant has denied all these documents but simultaneously, admitted the contractual relations with the plaintiff though not as per the assertions of the plaintiff. Since defendant has denied the supply of goods by the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 18/50 plaintiff through the aforesaid invoices but admitted the supply of the material from the plaintiff, hence, onus was on the defendant to establish the entire details of the transactions took place between them. The defendant was required to specify the following elements:
i) The details of contract;
ii) The specifications of material,
iii) Price of material,
iv) Place of supply of goods,
v) Particulars of the customers to whom goods were
supplied;
vi) Specification of rejected material and communication
about the same.
7.6 The defendant has not specified any of the aforesaid
necessary details of the contract. The defendant was required to specify all the details of the goods purchased by them from plaintiff. In case, the plaintiff had not supplied the goods to the defendant at the hospital site and through the aforesaid bills then it was for the defendant to bring on record all the relevant bills by virtue of which they had purchased the goods from the plaintiff. It is not the case of the defendant that plaintiff had not supplied the invoices alongwith the goods. As such all the invoices through which they purchased the goods ought to have been filed and proved by the defendant. According to the plaintiff, they had supplied the goods to the defendant at the hospital site which has been denied by the defendant. Here again onus was on the defendant to specify and prove the details of the customers for whom they had placed the order with the plaintiff if not for the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 19/50 hospital site. They were also required to prove where were goods supplied by the plaintiff if not at hospital site of NBCC. Except the bald statement defendant has neither specified the necessary details of the contract nor proved the same. Defendant is also a private limited company and must be regularly maintaining its audited account books and in case, they had not purchased the goods from the plaintiff through the invoices relied upon by the plaintiff, and they had purchased the goods through the some other invoices, the defendant ought to have produced and proved their account books to falsify the claim of the plaintiff. It is clear from the record that defendant remained completely silent on these material aspects. Thus, it is to be held that defendant has failed to discharge the onus to prove these relevant aspects. Furthermore, an adverse inference should be drawn against the defendant for not producing the relevant material (invoices and account books) and evidence before this court. In this regard, this Court is supported by the Judgement of Hon'ble Supreme Court reported as 2013 AIR SC (Civil) 1571 Union of India Vs. Ibrahim Uddin & Anr. Thus, in the absence of any relevant material it is to be presumed and held that in pursuance to the MOU plaintiff had supplied the requisite material to the defendant at the site of ESIC Hospital.
7.7 Plaintiff's claim is that they supplied the material as specified in the invoices but according to defendant the plaintiff did not supply the aforesaid material as the deal mentioned in the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 20/50 MOU did not materialize due to the unprofessional conduct of the plaintiff but according to defendant they had another argument with the plaintiff for supply of some other specific material details of which have also not been specified by the defendant. This particular plea of defendant that they had another deal is not reliable as on one hand defendant contended that they did not do any business with the plaintiff in furtherance to execution of MOU as they found plaintiff unprofessional while on the other hand, in the same breath, they contended that they purchased some material from the plaintiff. Thus, it cannot be assumed that defendant would establish business relations with such business establishment which wanted to bypass them and usurp their business. Even if it is believed yet defendant was required to specifically plead the reason for placing such an order with the plaintiff with complete details of the same. They made their entire efforts to establish that said MOU was not acted upon and no material as claimed in the invoices was received by them but according to the plaintiff they had supplied the aforesaid material and defendant had also made the part payment of considerable amount which according to the defendant was against some other transaction. Thus, besides, the said defence, the defendant was also required to put forth their main defence during the cross examination of PW1 that defendant had paid the amount of Rs.75,00,000/ towards the some other material purchased by them but not towards the part payment of the supply of goods as claimed by plaintiff. Defendant remained completely silent on this aspect during the cross examination of the PW1. Besides, Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 21/50 defendant was also required to put forth their another defence that the material supplied by the plaintiff was overpriced and of inferior quality, however, no cross examination has been preferred by the defendant on all these material aspects of their defence. This fact clearly shows that this plea has been taken by the defendant for the sake of plea and there is no real substance in it.
7.8 Defendant has also claimed that the material supplied by the plaintiff was not as per agreed specification and also of inferior quality and when they brought this fact to the notice of the plaintiff, plaintiff agreed not to bill the defendant qua the same. It is clear that defendant did not put forth the aforesaid defence to the PW1. Further, defendant had ample opportunity to establish their aforesaid defence, however, it is clear that the defendant has simply taken a plea in their written statement but defendant has not filed even a single document in support of their aforesaid plea. Defendant has neither specified the details of the goods purchased by them nor the particulars of their customers for whom they had made the said purchases. Defendant had ample opportunity to bring on record the relevant evidence in support of their defence, however, they failed to examine any witness in support of their defence. As far as the defence of complaining about the inferior quality of goods is concerned, again defendant has neither specified as to when and with whom such a complaint was made by them. Defendant has not placed on record any correspondence made by them in this regard. This Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 22/50 particular conduct fortifies the fact that this defence of the defendant is without any substance and this defence has been taken by the defendant in order to deny their liability towards the legal claim of the plaintiff. As already discussed that the entire emphasis of the defendant has been to establish that plaintiff did not supply any material in pursuance to the MOU but the said defence of the defendant will always remain untrustworthy unless defendant proves their claim of purchase of some other material and also of supply of inferior quality material by the plaintiff. In case, the defendant fails to establish their aforesaid defence under the circumstances discussed above, it has to be presumed that plaintiff had supplied the material to the defendant on the basis of the invoices Ex PW1/5 to PW1/9 and payment of considerable amount of Rs. 75,00,000/ was made by the defendant towards the part payment of the goods supplied by the plaintiff, especially, when defendant does not knowingly produce their account books as well the invoices of the purchases made by them from the plaintiff. So in view of these discussions, it is held that defendant has miserably failed to prove their defence.
7.9 Admittedly, the defendant company was awarded a contract by the NBCC for supply of medical equipments at the ESIC Hospital, Babu Nagar, Ahmedabad, Gujarat. It is also admitted position of fact that defendant made plaintiff a sub agent for supply of the said material to NBCC. As per plaintiff, they supplied the material in terms of the MOU while defendant denies the same. Thus, under these circumstances, the defendant ought Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 23/50 to have taken a specific stand about the contract awarded to them. There could only be two eventualities, if we go by the claim of the defendant that either their contract would have been cancelled and if not, then they would have supplied the material through some other entity, however, defendant neither claimed that their contract was canceled nor that they supplied the material through some other firm or entity. Onus to establish the aforesaid facts will always be on the defendant because they were the main agents and if according to them the plaintiff did not supply the requisite material to the NBCC then they ought to have established as to who else made the requisite supply. Defendant neither claimed that their agency was cancelled nor that they procured the material through somebody else. In order to prove their defence, defendant ought to have examined the concerned witness from the office of the Nodal Agency NBCC but defendant made no effort to examine any person from the nodal agency. It seems from the cross examination of the PW1 that defendant never claimed that their contract was cancelled, however they tried to deny the claim of the plaintiff also on the ground that no payment was ever received by the defendant from NBCC. Admittedly, the defendant paid a considerable amount of Rs.75,00,000/ to the plaintiff and it is clear from the aforesaid discussion that this amount was not paid by the defendant towards any other purchase, thus, firstly it has to assumed that this amount was paid by the defendant towards the part payment of the goods supplied by the plaintiff and secondly, it cannot be assumed that defendant made the aforesaid part payment to the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 24/50 plaintiff without getting any amount from the Nodal Agency. The defendant could have easily proved their defence of non receipt of any amount either by examining the concerned witness from the office of the Nodal Agency or also by producing their account books of the relevant period. Defendant neither produced their statement of accounts pertaining to the contract with the Nodal Agency nor they examined any witness from the Nodal Agency to establish the same. Thus, this plea of the defendant that they did not get any amount from the Nodal Agency is also without any substance. Thus, the adverse inference should also be drawn against the defendant for not producing the best evidence which was well within their reach. As already discussed, in order to prove their defence and deny the claim of the plaintiff, it was imperative on the part of the defendant, to bring on record the relevant material in their evidence and what to talk of non summoning the witness from the office of the Nodal Agency, they even did not produce their own accounts books and other documents regarding purchase of the goods from the plaintiff. Thus, under these circumstances, it has to assumed that defendant did not examine any witness from the office of Nodal Agency as it would have falsified their claim of non supply of the material by the plaintiff.
7.10 It is clear that on one hand defendant has simply denied the claim of the plaintiff without any supporting material and evidence and on the other hand, the claim of the plaintiff is based upon relevant material. Besides, the same it is also clear Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 25/50 from the invoices Ex PW1/5 to PW1/9 that plaintiff has mentioned the address of ESIC Hospital, Babu Nagar, as the place of the delivery of the material. It is further clear that plaintiff had also sent the copies of the legal notice Ex PW1/13 ( Postal Receipts have been collectively brought on record as Ex PW1/14) at the concerned offices of the NBCC, the Nodal Agency and it is further clear from the tracking report Ex PW1/18 and PW1/19 that these notices were duly served upon the Nodal Agency. Thus, this action on the part of plaintiff further strengthens their claim that in pursuance their agreement, they had supplied the goods at the hospital site and when defendant failed to pay the outstanding amount of the goods, plaintiff brought this fact to the notice of the Nodal Agency. It is admitted position of fact that Nodal Agency is a Government concern and as such, it cannot be assumed that firstly, the plaintiff would forge the invoices by falsely mentioning the place of delivery which is the address of a Government Organization and secondly, they would bring their own illegal acts of misusing the name of the Government Organization by sending the copies of their legal notices to them. In case, the plaintiff would have forged the invoices for raising a false claim not only the defendant but Nodal Agency also would have initiated appropriate legal action against them. Thus, under this circumstance, it can be very well said that the plaintiff sent the copies of the legal notices to the Nodal Agency to bring to their notice that their contractor (defendant) has not cleared their dues.
7.11 It is further clear from the contents of Para no.7 of the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 26/50 reply on merits of the written statement that defendant has taken mutually contradictory stand about the transactions took place between them and plaintiff. It is clear from the perusal of the initial contents of aforesaid para that defendant completely denied that plaintiff supplied any material on basis of the invoices Ex PW1/5 to PW1/9 but perusal of the further part of the averments made in this very para shows that defendant has admitted the supply of material by the plaintiff for a Government Organisation which could only be ESIC Hospital as it is clear from the aforesaid discussion that defendant has not brought on record any material to show that on their behalf plaintiff had made supply of any material to any other Government Organization except the ESIC Hospital. The relevant contents of para no.7 of reply on merits of written statement are reproduced as under: "7. ............. It is further submitted that the plaintiff has supplied some of the material and charges huge amount of RS.75,00,000/ from the plaintiff and when plaintiff came to know about the huge prices charged by the plaintiff then it has been disclosed by the plaintiff that they are charging very high in government projects and by this way when defendant gave strict warnings then plaintiff started approaching Nodal Agency directly and when it came to the knowledge of the defendant it has been told to the plaintiff that if they would not stop this illegal tactics then the case would be filed against them for violating maximum selling price law and defendant also requested to refund the huge amount which has been charged by the plaintiff and due to the said reason above plaintiff has now filed a false and frivolous suit against the defendant on the basis of concocted story and fabricating documents".
Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 27/50 7.12 In view of the provisions of order 8 rule 5 CPC denial to every averments has to be specific and in case, defendant takes mutually contradictory stand to their main defence, it would clearly show that there is no substance in their defence otherwise they would not have deviated from their main defence and would have continued to stand by the same defence through out their pleadings. Thus the aforesaid inconsistent pleas taken by the defendant in their written statement regarding supply of the goods clearly shows that there is no substance in their defence of non supply of the material by the plaintiff as per MOU rather this indicates that plaintiff had supplied the material as claimed by them.
7.13 The plaintiff has claimed that in order to demand their outstanding amount, on dt. 28.02.17 they sent an email to the defendant at their three email addresses requesting them to deposit the outstanding amount (as per attached statement of account), in their bank account details of which were also specified in this very email. Plaintiff has further claimed that after the said communication, the defendant deposited a sum of Rs.46000/ in their bank account on dt.06.03.17 and this amount was duly acknowledged by the plaintiff vide another email dt. 27.03.17 and after adjusting the said amount, the plaintiff again requested the defendant to clear the remaining outstanding amount as per the attached statement of account dt.20.03.17. PW1 reiterated the said assertions in para no.9 of his affidavit and Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 28/50 he brought on record both the emails as Ex.PW1/10 and Ex. PW1/11. The copies of the said emails have been duly supported by a certificate of section 65 B of evidence act Ex PW1/B wherein it has been stated by PW1 that the said emails were sent by him to the defendant which were duly received by the defendant. The said email addresses were also brought on record by PW1 through the document Mark B and it is clear from the cross examination of DW1 that DW1 admitted that the said email addresses are of defendant company. Thus, according to the plaintiff prior to sending the legal notice to the defendant they had demanded their outstanding amount through the emails also and both the relevant emails have been brought on record by the PW1 besides reasserting their aforesaid claim. It is clear that this part of the deposition of the PW1 remained completely unrebutted. No cross examination whatsoever has been preferred in order to deny the receipt of the said emails. Thus, under these circumstances, it can be very well presumed that the said emails were duly received by the defendant company. It is also clear from the record of the case that defendant never responded to the said emails. In case, the plaintiff company would have raised false demand then defendant would have immediately refuted the claim of the plaintiff at least at the time of receipt the second email as the contents of second mail shows that plaintiff demanded the balance outstanding amount besides informing the defendant that out of the total outstanding amount they have only paid Rs.46000/. Defendant neither refuted the claim of the plaintiff regarding the outstanding amount nor the correctness of the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 29/50 statement of account ( as far as the supply of goods through initial five invoices Ex PW1/5 to PW1/9 is concerned) though; defendant ought to have refuted the said claim of the plaintiff immediately, if plaintiff had raised false and illegal demand. It cannot be assumed the defendant would remain silent or inactive, especially, when illegal demand of such a considerable amount is made. As such, it can be very well said that defendant remained completely silent despite receipt of the said emails as plaintiff had raised genuine claim via said emails.
7.14 As per plaintiff, when defendant did not pay their outstanding amount, they served the defendant with a legal notice Ex PW1/13. As per plaintiff said legal notice was sent at all the three addresses of the defendant vide postal receipts Ex PW1/14 and it was duly served upon the defendant at their addresses. In order to fortify the factum of service of legal notice plaintiff has relied upon the tracking report Ex PW1/15 to PW/1/17. Defendant has simply denied the service of legal notice, however they have not denied the correctness of their addresses where the legal notice was sent. It is clear that out of these three addresses two addresses have been mentioned in the board resolution (Ex DW1/1) by virtue of which DW 1 has been appointed as their authorized representative. Furthermore, during cross examination, DW1 has admitted the correctness of these addresses which have been brought on record by PW1 through Mark B. As such, it is clear that legal notice was sent at the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 30/50 correct address of the defendant, thus, in view of the settled provisions of Sec 27 of General Clauses Act, the legal notice should be presumed to have been duly served upon the defendant. In view of these discussions it is clear that firstly plaintiff demanded the outstanding amount through aforesaid two emails and subsequent thereto through the aforesaid legal notice. Thus, after service of legal notice defendant must have come to know that plaintiff is likely to assert their claim before the court of law and therefore, at least at that very stage they ought to have promptly rebutted the claim of the plaintiff by sending a reply, however, it is admitted position of fact that defendant did not send any reply to the legal notice sent by plaintiff. Furthermore, it is clear that instead of putting forth the reasonable explanation for not sending reply to the legal notice, the defendant is denying the service of the same. One more important aspect is also required to be mentioned here as there is a slight difference in the present suit as plaintiff has claimed the outstanding amount from the defendant of the material supplied to the Government Institution on behalf of the defendant. It is clear that in the legal notice also plaintiff has claimed the supply of material at ESIC Hospital for the Nodal Agency NBCC. Thus, in case, the plaintiff would have raised a false claim that too by misusing the name of the Government institution, the defendant alongwith the Nodal Agency, NBCC (the Nodal Agency was also served with the copy of legal notice), not only would have replied the legal notice but simultaneously, would have initiated appropriate legal action against the plaintiff but it is clear that no action whatsoever was Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 31/50 initiated by anyone of them against the plaintiff rather it is clear that instead of furnishing explanation for not sending reply, the defendant chose to deny the service of the same. Thus, under these circumstances an adverse inference should be drawn against the defendant that defendant did not reply to the legal notice as plaintiff had raised the genuine and legal claim. In this regard this court is supported by the judgment of Hon'ble Delhi High Court reported as Group Interiors Vs. Subhash Chachra, 2012 (186) DLT 724.
7.15 The claim of the plaintiff is based upon invoices as well as statement of account besides the other important factors of sending emails and legal notice and defendant has simply claimed that no supply was made in pursuance to the MOU agreement and that they had a different agreement with the plaintiff qua which plaintiff had made a supply and against the said supply they had paid Rs.75,00,000/ to the plaintiff. As already discussed, the defendant has miserably failed to establish their defence. As such it is to be assumed that defendant has taken this plea/defence only for the sake of taking a defence and there was no substance in it. Consequently, it is to be further assumed that defendant had entered into only one and sole agreement with the plaintiff i.e. MOU Ex PW1/4 which was acted upon by both the parties as after plaintiff supplied the goods to the defendant through the invoices Ex PW1/5 to PW1/9, the defendant made the part payment of substantial amount to the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 32/50 plaintiff. Thus, in view of the aforesaid discussions, it can be very well said that firstly the plaintiff has proved their claim by way of their positive evidence and even otherwise, it is clear from the evidence led by both the parties that claim of the plaintiff stand on far better footing than that of the defendant. As such, it is held that plaintiff is entitled to recover the balance amount of the goods supplied by them to the defendant.
7.16 Besides, claiming the balance amount of the aforesaid five invoices, the plaintiff has also claimed the amount of five more following detailed invoices which comes to Rs 13836/ including some debit charges mentioned in the statement of account Ex.PW1/12.
Invoice No. Dated Amount 11/848 16.07.2011 2205.00 13/768 03.06.2013 3500.00 02518 15.12.2014 3600.00 00402 21.05.2015 2000.00 02239 08.02.2017 2362.00 7.17 Admittedly plaintiff has not filed any of these five
invoices in support of their claim and the defendant has disputed the supply of the material against these invoices as well. As already discussed that defendant has failed to dispute the authenticity of the statement of account as well as the claim of the plaintiff after receipt of two emails as well after service of legal notice therefore, an adverse inference has been drawn against Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 33/50 the defendant while keeping in view of the other factors pertaining to the proving of the claim by the plaintiff against the five invoices (Ex PW1/5 to PW1/9). As far as the said five invoices (Ex PW1/5 to PW1/9) are concerned the adverse inference has been drawn against the defendant, as plaintiff has discharged the initial burden of proving the supply of goods on the basis of these invoices, however, the supply of goods cannot be assumed against these rest of the five invoices mentioned in para no.7.16 by drawing the same adverse inference as plaintiff has neither placed on record the relevant invoices nor any acknowledgment thereof. Thus, it is held that plaintiff is not entitled to recover the amount of these invoices as they have failed to prove the delivery of goods against these invoices. Thus, it is held that plaintiff is entitled to recover the balance amount of the invoices Ex PW1/5 to PW1/9 from the defendant. As far as the balance amount is concerned plaintiff has claimed the balance amount after adjusting the amount of Rs.75,59,836/. As per plaintiff, after making the initial payment of Rs.75 Lacs, the defendant had made further payments of Rs.59836/. As far as the issue related to this payment is concerned, it is clear from the contents of para no.20 of reply on merits of written statement that as per defendant no transaction took place between the parties after 2011. Thus, it clear that defendant has disputed any subsequent transaction between the parties after 2011 which includes the claim of the plaintiff regarding further supply of goods by aforementioned subsequent five bills and also the further part payments (cash payments) stated to have been made by the defendant. Thus, as Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 34/50 far as the defendant is concerned as per their claim they neither purchased any material after 2011 nor made any cash payment to the plaintiff. As far as the issue of cash payment is concerned, the plaintiff has sought extension of limitation on the basis of these part payments/cash payments therefore, this particular issue has been dealt with in detail while deciding the issue of limitation and therefore, the same is not repeated here for the sake of brevity. It has been held while deciding the issue of limitation that plaintiff has failed to prove the receipt of these cash payments. Thus, under these circumstances plaintiff can be said to be entitled to the said amount as well but since the plaintiff themselves have claimed the lesser amount (as admission to forgo the part of certain claim by the plaintiff themselves and proving the receipts of payments from defendant in order to have the benefit of the provisions of section 18 and 19 of Limitation Act are two different aspects and thus, have to be dealt with separately in accordance with the provisions of law applicable to both these different situations) in the suit and has also paid the court fees accordingly, therefore, it is held that plaintiff is only entitled to what they have claimed in the present suit. In view of these discussions, it is held that plaintiff is entitled to the balance amount of the invoices Ex PW1/5 to PW1/9 which comes to 1,10,93,807/. Plaintiff has further claimed an amount of Rs.86,82,797/ qua the pre suit interest on the outstanding amount. Plaintiff has claimed 12% pa interest on the outstanding amount w.e.f. 26.07.11 (the date of which defendant paid Rs.75,00,000/) and the calculation of the interest claimed has been specified in Ex PW1/19A correctness of Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 35/50 which has not been disputed by defendant. Since the defendant has failed to pay the due amount to the plaintiff in time and also despite requests and service of legal notice, hence, plaintiff is entitled to interest on the late payment. Plaintiff has claimed the interest @ 12% p.a. which appears to be reasonable as the transaction between the parties was a commercial transaction, as such plaintiff is also awarded an amount of Rs 86,82,797/ on account of interest on the outstanding amount which pertains to the period w.e.f. 26.07.11 to 01.02.2018 i.e. till filing of the suit. The Issue no.1 is decided accordingly.
ISSUE NO.2 "Whether the plaintiff is entitled to recover interest, if yes, at what rate and for what period? OPP
8. The onus to prove this issue was on the plaintiff. While disposing of issue no.1, it has been held that the plaintiff is entitled to the balance amount of the goods sold. It is also clear from the aforesaid discussions that the defendant has failed to pay the outstanding amount despite receipt of emails and legal notice. Thus, it is clear that the defendant withheld the aforesaid amount without any justifiable reason and therefore, it is held that the plaintiff is entitled to the pendentelite and future interest as well. The transactions between the parties was a commercial transaction but there has been constant decrease in the rate of interest, thus, keeping in view of the totality of facts and circumstances, plaintiff is awarded pendentlite and future interest Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 36/50 @ 9% p.a. Issue no.2 is decided accordingly.
ISSUE NO.3 Whether the suit is barred by limitation? OPD
9. The onus to prove this issue is on the defendant. The plaintiff has contended that the present suit has been filed within the period of limitation. It is claimed by the plaintiff that in regard to the invoices Ex.PW1/5 to Ex.PW1/9 the part payment of Rs.75.00 lac was made by the defendant on dated 26.07.2011 and subsequently, on several occasions the cash payment was made by the defendant. The details of the cash payment stated to have been made by the defendant which have been mentioned by the plaintiff in Ex.PW1/12 are as follows: Date Cash Reference No. Amount 07.11.2011 11/1811 113.00 19.04.2012 12/140 56.00 17.06.2013 13/768 3600.00 15.12.2014 INV 2518 3600.00 21.05.2015 00402 2000.00 08.02.2017 02239 2363.00 06.03.2017 On account 46000.00 9.1 In the present suit the plaintiff has claimed the balance amount of the goods supplied to the defendant. Neither plaintiff nor defendant has specified as to when payment of the Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 37/50 goods supplied was to be made, however it is clear from the invoices (Ex PW1/5 to PW1/9) that payment of the goods was to be made by the defendant within seven days of the receipt of the goods. Thus, under these circumstances, as far as the limitation is concerned, the present case is governed by the provision of Article 15. Thus, limitation to recover the amount of bills starts after seven days of delivery of goods. It is also clear that plaintiff was maintaining open and running account regarding their transactions with the defendant and since, in the present case, defendant made on account payment (within three years of the goods lastly supplied), the limitation would further extend for another three years from the date of last payment. In this regard, this Court is supported by the Judgement of Hon'ble Delhi High Court reported as 2012(190) DLT 253 titled as Naraingarh Suger Mills Ltd. Vs. Krishna Malhotra. Now it is to be seen as to when was the last part payment was made by the defendant to the plaintiff. Defendant has only admitted the payment of Rs.75,00,000/ and has denied rest of the payments which is clear from the contents of para no.20 of the written statement of the defendant. It has been claimed by the plaintiff that after payment of Rs.7500000/, defendant made aforementioned cash payments and as per plaintiff, defendant deposited Rs.46,000/ cash in their bank account subsequent to their email dated 27.02.2017 and this amount was acknowledged by the plaintiff and after adjusting the said payment the statement of account was sent to the defendant through another email dated 27.03.2017 with a request to make the payment of the balance Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 38/50 outstanding amount. It is further claimed that defendant neither replied the said emails nor raised any dispute regarding the authenticity of the statement of account qua any of the entries made therein including the receipt of cash payments from the defendant reflected in the statement of account. It is further submitted that thereafter plaintiff had served the defendant with a legal notice (Ex.PW1/13) and even thereafter, no dispute whatsoever was raised about the correctness of the statement of account as well as payment of Rs.46,000/ lastly deposited by the defendant in cash in the bank account of the plaintiff. It is submitted that the plaintiff has reiterated the said claim in their plaint and also relied upon the statement of account which was sent to the defendant through email. It is submitted that defendant has only disputed the payment of Rs.46,000/ and has neither disputed the rest of the cash payments which are reflected in the statement of account nor said anything about the correctness of those entries made in the statement of account. Thus, it is submitted that the defendant has not disputed the claim of the plaintiff regarding the aforesaid cash payments except the cash payment of Rs.46,000/ and even if this payment is not taken into consideration, the present suit is within limitation, if limitation is computed from another cash payment made by defendant on dated 08.02.2017. Thus, Ld. Counsel for the plaintiff contended that the present suit has been filed within three years of the last payment made by the defendant to the plaintiff.
9.2 It is well settled law that a fresh period of limitation to Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 39/50 recover the dues/debt starts if either defendant or their representative has acknowledged the debt or factum of part payment. Thus, under these circumstances, the provisions of section 18 and section 19 of Limitation Act comes into play which are reproduced as under:
18. Effect of acknowledgment in writing.
(1) Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
(2) Where the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received.
Explanation.--For the purposes of this section,--
(a) an acknowledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come or is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to set off, or is addressed to a person other than a person entitled to the property or right,
(b) the word "signed" means signed either personally or by an agent duly authorised in this behalf, and
(c) an application for the execution of a decree or order shall not be deemed to be an application in respect of any property or right.
Section 19 in The Limitation Act, 1963
19. Effect of payment on account of debt or of interest on legacy.--Where payment on account of a debt or of interest on a legacy is made before the expiration of the prescribed Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 40/50 period by the person liable to pay the debt or legacy or by his agent duly authorized in this behalf, a fresh period of limitation shall be computed from the time when the payment was made: " Provided that, save in the case of payment of interest made before the 1st day of January, 1928, an acknowledgment of the payment appears in the handwriting of, or in a writing signed by, the person making the payment. Provided that, save in the case of payment of interest made before the 1st day of January, 1928, an acknowledgment of the payment appears in the handwriting of, or in a writing signed by, the person making the payment." Explanation.--For the purposes of this section,-- Explanation.--For the purposes of this section,--"
(a) where mortgaged land is in the possession of the mortgagee, the receipt of the rent or produce of such land shall be deemed to be a payment; (a) where mortgaged land is in the possession of the mortgagee, the receipt of the rent or produce of such land shall be deemed to be a payment;"
(b) "debt" does not include money payable under a decree or order of a court. (b) "debt" does not include money payable under a decree or order of a court."
9.3 It is well settled law that in order to seek the extension on the grounds mentioned in Section 18 and 19 of Limitation Act., the acknowledgement of debt/part payment has to be in writing. In this regard this court is supported by the Judgement of Hon'ble Delhi High Court reported as 2012(190) DLT 253 titled as Naraingarh Suger Mills Ltd. Vs. Krishna Malhotra. The relevant portion of the said Judgment is as under: "6. ...... I am unable to agree with the contentions as raised on behalf of the appellant, inasmuch as, Section 19 of the Limitation Act, 1963 has rightly been relied upon by the trial Court to hold that a fresh period of limitation commences once payment is made on account of the debt due. In this case, the debt which was due to the respondent/plaintiff was the total debt Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 41/50 due including the nine bills which have been referred to in the cross-examination of DW1 and, therefore, the payment of cheque is towards part of the total debt due. Once the payment is made towards part of the total debt due, Section 19 of the Limitation Act, 1963 comes into play whereby a fresh period of limitation starts on payment having been made in writing and under the signatures viz. by a cheque towards the part of debt due". (The underlining is done to highlight the relevant portion).
9.4 The same view has been taken by Hon'ble Calcutta High Court in case reported as 2012 (2) Civ C.C 300 titled Mamata Ghosh & Anr. Vs. Tapan Ghosh. The relevant para of this said judgement reads as under: "11. The proviso ordains that an acknowledgement of the payment must appear either in the hand-writing of the person making the payment or in a writing signed by such person to extend the period of limitation to be computed from the date the payment is made. Sant Lal Mahton (supra) requires that the said signed acknowledgement must exist on the date the suit is instituted; even acknowledgement of payment in the written statement would not be sufficient to extend limitation".
9.5 Thus, it is well settled law that in order to get benefit of section 19, it has to be established by the plaintiff that the there is an acknowledgement of the last payment made by the defendant. In this regard this court is further supported by the Judgement of Hon'ble Kerala High Court reported as 2010(1) KLT 801 titled as Sajan Varghese Vs. Kerala State Electronic Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 42/50 Development Corporation Ltd. In this case, the Hon'ble High Court has specified the mandatory requirements for extension of limitation on the basis of provisions of Section 19 of Limitation Act. The relevant paras are as under: "12. To claim exemption under section 19 of the Limitation Act it is mandatory that the plaintiff must be in a position to allege and prove the part payment and that such payment had been acknowledged in writing in the manner contemplated by the section. In the plaint itself there must be pleadings and the plaint shall also be supported by proof showing that such payment had been acknowledged in writing in the manner contemplated by section 19.
13. The Apex Court in the said case held that to claim exemption under Section 20 of the Limitation Act, (presently Section 19) the plaintiff must be in a position to allege and prove not only that there was payment of interest on a debt or part payment of the principal, but that such payment had been acknowledged in writing in the manner contemplated by that section, that the ground of exemption is not complete without the second element, that unless both these elements are proved to exist at the date of the plaint the suit would be held to be time barred".
9.6 Thus, it is clear that in order to take the benefit of provisions of section 19 of Limitation Act, the plaintiff is required to plead and prove the acknowledgement of defendant regarding the last part payment made by them. Thus, in view of the settled legal position the non rebuttal on the part of defendant regarding all the cash payments mentioned in the statement of account Ex.PW1/12 filed by the plaintiff cannot be treated to be Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 43/50 acknowledgement under section 19 of the Limitation Act. It is clear that though, the defendant has not made any rebuttal regarding these cash payments despite of emails and receipt of legal notice, however it is clear that defendant has denied any transactions with the plaintiff after the year 2011. It is further clear that defendant has specifically denied the last cash payment of Rs.46000/ in their written statement as well as during cross examination of PW1. Though this assertion of the plaintiff qua the receipt of the cash payment remained completely unrebutted in response to the emails and legal notice, however, it is clear that all the cash payments have been denied by the defendant in their written statement. Now, it is to be seen, even if the same would have remained completely unrebutted yet the same could have been treated to be an acknowledgment in terms of section 18 and 19 of limitation act. It is well settled law that the acknowledgment specified in these provisions has to be a written acknowledgment only. The part payment made by a cheque is also considered to be an a written acknowledgment. In this regard, this court is also supported by the Judgement of Hon'ble Delhi High Court 2010 (118) DRJ 246 titled International Print OPack Ltd Vs.MAA Communication Bozall Pvt. Ltd. The relevant para of the said Judgement reads as under: "20.This court in the case of Rajesh Kumari(supra) held that "a payment by cheque satisfies the requirement of Section 19,in as much as the acknowledgment of payment appears in the handwriting of or in a writing signed by the person making the payment in the form of a cheque."
Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 44/50 9.7 Thus, in view of the settled legal position, the plaintiff was required to prove on record the acknowledgement of part payment issued by defendant or their authorized representative. The plaintiff has not specified as to how they had received the other cash payments except the payment of Rs.46,000/ which was stated to have been deposited in cash in their bank account by the defendant. Thus, in order to prove that these payments have been made by or on behalf of the defendant, the plaintiff ought to have summoned the relevant record from the bank concerned to establish the same, however, plaintiff did not make any effort to bring the relevant bank documents on record during their evidence. It has been held by the Hon'ble High Court in a Judgement reported as 2018 (2) AD Delhi 699 titled as Rajinder Valecha & Anrs Vs. Satpal & Anr that for cash payment also there has to be written acknowledgement. The relevant para of the said Judgment reads as under: "12. Having considered the facts of the present appeal in the light of the statutory provisions and judgment of the Hon'ble Supreme Court in J.C. Budh Raj case (supra), it is to be noted that after acknowledgment dated 25.02.2009, the alleged payment of Rs.1 lacs and Rs.3 lacs of 06.04.2010 and 13.02.2015 were made by cash by the respondents to the appellants and Rs.3 lacs by cheque dated 25.12.2015. Admittedly, the limitation of three years for filing the suit for recovery from the last acknowledgment dated 25.02.2009 had expired on 25.02.2012.
There is no written acknowledgment of the cash payment of Rs.1 lacs on 06.04.2010 before expiry Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 45/50 of limitation i.e. 25.02.2012. Therefore, benefit of Section 19 cannot be extended to the appellants on account of alleged payment made on 06.04.2010. The admitted payment of Rs. 3 lacs made on 13.12.2015 is after expiry of 3 years from acknowledgement dated 25.02.2009 and therefore it is of no help to the appellant in getting period of limitation extended. The payment of Rs.3 lacs by cheque dated 25.12.2015 is also after expiry of three years from 25.02.2009. Therefore, these payments do not fulfil the requirement of Section 18 and 19 of the Limitation Act, 1963".
9.8 Thus, in view of the settled law, the admission of liability/acknowledgement has to be expressly made by or on behalf of the defendant and law does not permit it to be inferred. So, the same inference which has been drawn in the present case, in regard to the supply of goods by the plaintiff to the defendant as well as for the non production of statement of account by the defendant cannot be drawn qua the acknowledgement of liability due to non rebuttal of the emails, statement of account and legal notice. It is well settled law that once law requires something to be done in a particular manner then it has to be done in that manner only in order to take benefit of the same. Thus, the law related to treating the non rebuttal of certain part of evidence/testimony of a witness as an admission of the other side cannot be applied here since, as per law, the acknowledgement of part payment/liability has to be made by the defendant in writing that to before expiry of the period of limitation. In view of these discussions, it is held that in the present case, the cash payments which have been reflected in Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 46/50 the statement of account Ex.PW1/12 cannot be treated to be acknowledgement of liability or acknowledgement of the part payment on the part of defendant as firstly defendant has not made any acknowledgement or admission in writing and secondly, the plaintiff has not brought any evidence on record to establish that these cash payments were made by the defendant.
9.9 In view of these discussions, it it held that plaintiff has neither proved any written acknowledgment of liability or part payment nor brought on record any evidence to establish that the aforesaid mentioned cash payments were made by the defendant. As such, limitation for filing the present suit is to be computed from the date of sole admitted payment of Rs.75,00,000/ which was admittedly made on 26.07.2011. Thus, plaintiff could have filed the present suit only by 25.07.2014, however, the present suit was filed by the plaintiff on 31.08.2018 (though as per plaint initially the present suit was filed before Hon'ble High Court on 01.02.2018 and after enhancement of pecuniary jurisdiction subsequently, it was filed before Commercial Court), therefore, it is held that the present suit is barred by limitation. This issue is decided accordingly.
ISSUE NO.4 Whether this Court lacks territorial jurisdiction to try the matter? OPD
10. The onus to prove this issue was on defendant. In Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 47/50 regard to territorial jurisdiction of this Court, the plaintiff has contended that they are having their registered office within the jurisdiction of this court and MOU between the parties was also executed in the office of plaintiff at Delhi. It is further submitted that corporate office of defendant is also at Delhi. PW1 reiterated the above said stand of the plaintiff in his affidavit. It has already been held while deciding issue no.1 that MOU was executed between the parties and it is clear that the same was executed at the registered office of plaintiff. It is further clear from the invoices Ex.PW1/5 to Ex.PW1/9 that these invoices were raised by the plaintiff at their Delhi office. It is further clear that the payment of Rs.75,00,000/ was made by the defendant to the plaintiff through RTGS transfer which was received and reflected by the plaintiff in their statement of account which is being maintained at their registered office. Besides this, it is undisputed that defendant was/is having their corporate office within the jurisdiction of this court and this fact is also clear from the Board Resolution Ex.DW1/1 passed by the defendant in favour of their authorized representative Sh. Sanjay Pal. As such, it is clear that the part cause of action arose within the territorial jurisdiction of this Court. Thus, this court has the jurisdiction to try and entertain this case. Moreover, defendant has not led any evidence to the contrary. This issue is decided accordingly.
11. Before parting with present Judgement, it is necessary to deal with the submissions made by the Ld. Counsel Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 48/50 for defendant during the course of the argument regarding non compliance of section 12A of Commercial Court Act. It has been submitted that the provisions of Section 12A were notified on 03.07.2018 and the present suit was filed on 30.08.2018, however, plaintiff did not comply with the provisions of section 12 A of Commercial Court Act as they did not file any application u/s 12A. It has been further submitted that the Hon'ble Supreme Court has held in the case of M/s Patil Automation Private Limited and Ors. vs. Rakheja Engineers Private Limited that the compliance of section 12A of commercial court act is mandatory and therefore, it was submitted that the present suit is liable to be dismissed as mandatory compliance has not been made by the plaintiff. In this regard, Ld. Counsel for the plaintiff has also relied upon the same Judgment of Hon'ble Supreme Court and submitted that the compliance of section 12A has been made mandatory w.e.f 20.08.2022. Thus, it is submitted that at the time of filing of the present suit the compliance of section 12A was not mandatory. In this regard, it is pertinent to mention here that the process of preinstitution mediation u/s 12A started in the District Court after the circular dated 27.11.2018 was issued by the Ld. Member Secretary,DSLSA and it is admitted position of fact that the present suit was filed before this Court on 30.08.2018. It is further clear that as per the directions of the Hon'ble Supreme Court, the compliance of Sec.12A has been made mandatory w.e.f 20.08.2022. Thus, in view of these discussions, it is clear that at the relevant point of time neither the compliance of section 12A Commercial Courts Act was Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 49/50 mandatory nor the plaintiff could have filed an application u/s 12 A for preinstitution mediation as the process qua the same began subsequent to filing of the present suit. As such the present suit cannot be said to be barred by law i.e. for non compliance of section 12A of Commercial Courts Act.
RELIEF
12. Though while deciding Issue no.1&2, it has been held that the plaintiff is entitled to the recovery of balance outstanding amount of the invoices Ex.PW1/5 to Ex.PW1/9 alongwith presuit and pendentelite and future interest, however, plaintiff is not entitled to have a decree for recovery of the aforesaid amount in their favour as the present suit is barred by limitation as has been held while deciding Issue no.3. Since the present suit is barred by limitation, the same is liable to be dismissed. Accordingly, same is hereby dismissed. No order as to cost. Decree sheet be prepared.
File be consigned to record room.
Announced in the Open Digitally signed
by AJAY GUPTA
Court on 29.11.2023 AJAY Date:
GUPTA 2023.11.29
15:08:17
+0530
(Ajay Gupta)
District Judge (Commercial)-05
West, Tis Hazari Courts Extension
Block, Delhi/29.11.2023
Case No. CS(COMM)/66/2020 M/s R.D Plast Vs.M/s Invoke Medical 50/50