Delhi District Court
M/S Stanvac Chemicals (India) Limited vs M/S Penta Control on 29 August, 2014
IN THE COURT OF SH. M.P. SINGH, SENIOR CIVIL JUDGE, RENT CONTROLLER,
(EAST), KARKARDOOMA COURTS, DELHI
Suit/CounterClaim No. 1729/06
Unique Case ID No. 02402C0634872006
M/s Stanvac Chemicals (India) Limited
1516, Old Sewa Nagar Market,
New Delhi .......... Plaintiff
Versus
M/s Penta Control
1022 B, '17' D Cross
Indiranagar IInd Stage
Bangalore560038 ......... Defendant/CounterClaimant
SUIT FOR RECOVERY OF Rs.1,55,732.54/ & COUNTERCLAIM OF Rs.25,459.65/
Suit filed on - 17.10.2006
Counterclaim filed on 03.11.2007
Arguments heard on 12.08.2014
Date of Decision - 29.08.2014
JUDGMENT
(1) The instant suit, as it appears from the plaint, is for recovery of money towards losses sustained by the plaintiff on account of nonissuance of FormC by the defendant. Defendant, refuting this claim of the plaintiff, on the other hand, seeks to recover the security money that it had paid to the latter at the time of inception of business transactions between the two, besides seeking refund of the excess money paid. (2) It is against its former distributor that the plaintiff has brought the present lis through its Accounts Manager, Sh. Manoj Kumar Jha. Plaintiff is, inter alia, into the business of CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 1 of 16 supply of industrial maintenance products. For distribution of its goods, it had appointed the defendant as its Exclusive Distributor. As per the plaintiff, the defendant, in terms of the agreement, deposited with it Rs. 50,000/ as noninterest bearing security. Plaintiff avers that the defendant, being a purchasing dealer, was under a statutory obligation to issue FormC for sale of its goods effected by the latter so as to enable it to obtain exemption under the applicable Sales Tax Act. Defendant failed, it is alleged, to discharge this statutory obligation as it did not issue FormC for the sales effected in financial years 20042005 and 20052006. Due to this, plaintiff states, it had to deposit sales tax with the concerned Sales Tax Department. Against the loss so caused, plaintiff set off the aforesaid noninterest bearing security amount and the credit balance from defendant's running account. For the remaining amount of Rs. 1,55,732.54/, it issued a legal notice dt. 22.08.2006 to the defendant thereby calling upon the latter to pay the same together with interest at the rate of 18% per annum within 15 days of its receipt. Defendant made no payment. It instead sent a reply, which the plaintiff terms as vague and incorrect. Thus, the present suit whereby the plaintiff seeks to recover Rs. 1,55,732.54/ together with pendente lite and future interest at the rate of 18% per annum thereon from the defendant.
(3) Defendant filed its written statement on 03.11.2007. The defence is that there were no dealings between the parties to the lis in the accounting year 200405. Defendant asserts that for the accounting year 200405, FormC could not have been issued to the plaintiff company as the latter was not the supplier of goods. For the accounting year 200405, as per the defendant, the supplier was in fact one M/s Sharad Traders and that the invoices were issued in the name of firm M/s Sharad Traders. Thus, FormC, it is submitted, could only be issued in the name of M/s Sharad Traders and not the plaintiff company. Defendant goes on CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 2 of 16 to state that the sale bill in this regard from M/s Sharad Traders was to the tune of Rs. 10,47,278.17/ and for this FormC bearing no. 2714959 has already been issued and delivered to the latter.
(4) As regards accounting year 200506 it is stated that FormC has been issued against all the invoices received from the plaintiff company.
(5) Defendant points out that FormC for all the invoices issued by M/s Sharad Traders has already been sent to the latter. Qua the invoices issued by plaintiff company, it is averred, FormC already stands issued to it. Defendant emphasises that it has never withheld any FormC. (6) Misjoinder of causes of action is said to render the suit bad. As per the defendant, amount of Rs. 79,268.35/ is supposed to be the arrears of payment qua goods supplied and that the plaintiff has erred in combining this amount with Rs. 76,464/ which is supposed to be the penalty paid to the State for having failed to furnish FormC. Defendant thus urges that the instant suit for recovery of total amount of Rs. 1,55,732/, on account of misjoinder of causes of action, cannot be maintained.
(7) Defendant further states that question of arrears of payment of goods supplied does not arise as transaction between the parties was cash and carry in nature. It submits that plaintiff gave no debit note from commencement of the agreement in 2002 till the last dealing on 01.01.2006. For each and every invoice raised, it is stated, by plaintiff company against the defendant, the latter made the payment either through demand draft or online payment.
(8) Defendant avers that various correspondences between the parties would reflect that it is under no liability towards the plaintiff. Not disputing plaintiff's averment about deposit CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 3 of 16 of security money of Rs. 50,000/, defendant avers that the former was not justified in adjusting the same against the alleged outstanding amount. It states that it had replied to the plaintiff's legal notice. Denying other averment, defendant seeks dismissal of the suit. (9) Plaintiff, in its replication, reiterates and reaffirms its stand as set out in the plaint and refutes those made by the defendant in the written statement. It is pointed out that plaintiff company comprises of four branches namely, (1) Dynamic Sales Corporation, (2) Tribo Technics, (3) SGT Engineers, and (4) Sharad General Trading. It is further pointed out that any invoice raised by any of the branches of plaintiff company is considered to be raised by the plaintiff and that the defendant is unsuccessfully trying to take advantage of this fact. In addition to this, there is one averment in the replication which cannot go unnoticed. Plaintiff states, "That the plaintiff has demanded the whole amount on account of losses and damages due to nonsupplying of C form and for non payment of the supplied goods." (10) Now to the relevant facts in the counterclaim. Defendant states that it had paid cash of Rs. 25,000/ as security (in contradistinction to the admission in the written statement that the security amount was Rs. 50,000/) to the plaintiff at the time of the entering into the agreement. Defendant goes on to state that the agreement for business transactions was initially for one year, but it was continuously renewed every year and finally discontinued in 2006. Defendant therefore avers that the security amount of Rs. 25,000/ be refunded as business between the parties stands discontinued. Besides this, it also seeks to recover Rs. 459.59/ which was the excess amount paid. As per the defendant, excess payment of Rs. 459.59/ was made in the last and final transaction of invoice no. DD424303 for Rs. 36,967.47/ and for which it had made an advance payment of Rs. 37,000/ through its current account in ICICI Bank. On this total amount of Rs. 25,459.59/ defendant claims CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 4 of 16 pendente lite and future interest @ 18% per annum.
(11) Plaintiff M/s Stanvac Chemicals (India) Ltd. filed its written statement to the counter claim on 12.05.2008. It states that the counterclaim is time barred and that the same has been filed without there being any authorised person. Denying its liability to pay the amount claimed in the counterclaim, plaintiff seeks its dismissal.
(12) The issues, settled on 11.02.2009, are as follows:
1. Whether the suit has been filed by duly authorized person on behalf of the plaintiff? OPP
2. Whether the suit of the plaintiff is barred by limitation? OPD
3. Whether the plaintiff is entitled for recovery of Rs. 1,55,732.54/ as claimed? OPP
4. Whether the plaintiff is entitled for interest on the suit amount? If yes at what rate and for which period? OPP
5. Whether the defendant is entitled for recovery of a sum of Rs. 25,000/ and another sum of Rs. 459.65/ as claimed in the counterclaim? OPD
6. Whether the defendant is entitled to interest on the amount claimed by him in the counter claim. If yes, at what rate and for which period? OPD
7. Whether the claim of the defendant as made by way of the counter claim is barred by limitation? OPP
8. Relief.
(13) Manoj Kumar Jha, plaintiff's accounts officer, entered the witness box as PW1. His examinationinchief is entirely along the same lines as averred by him in the body of the plaint. He exhibited the following the documents (a) Certified copy of Certificate of CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 5 of 16 Incorporation of plaintiff company as Ex. PW1/1, (b) Certified copy of the resolution passed by Board of Directors of plaintiff company in its meeting held on 12.01.2004 thereby authorising Manoj Kumar Jha to, inter alia, sign, verify and file suits/other proceedings as Ex. PW1/2, (c) Plaintiff's legal notice dt. 22.08.2006, the original postal receipts thereof together with defendant's reply dt. 28.08.2006 as Ex. PW1/3 (colly), (d) Copy of ledger statement of accounts of defendant for the period between 01.04.2006 to 30.03.2008 maintained by the plaintiff as Ex. PW1/4, and (e) Plaint as Ex. PW1/5. (14) On behalf of the defendant, one Narayan B. stepped into the witness box as DW1. He relied on FormC marked as Mark A1.
(15) I have heard arguments at Bar and perused the record of the case.
(16) Issuewise findings are as follows: (17) Issue no. 2 The issue is whether the defendant proves that plaintiff's suit is time
barred. From a bare reading of the plaint, it does appear that this suit has been filed on account of losses sustained for not furnishing FormC for the financial years 200405 and 200506. This suit was filed on 17.10.2006. This suit thus cannot be said to be time barred. (18) Next, the defendant in the written statement says that a part of plaintiff's claim amount is actually supposed to pertain to nonpayment of goods delivered. However, the defendant does not state as to the period for which this nonpayment for goods supplied is supposed to pertain to. And neither is there any crossexamination of PW1 by the defendant on this score. And thus, the point that was sought to be raised in the pleadings regarding the supposed nonpayment of goods delivered was not carried forward during the trial and it was neither shown that the claim on this count was actually beyond limitation. (19) I hold that the suit is not time barred. This issue is decided in plaintiff's favour and CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 6 of 16 against the defendant M/s Penta Control.
(20) Issue no. 3 - The issue is whether the plaintiff proves that it is entitled to recover Rs. 1,55,732.54/ from the defendant. For the following multiple reasons, the plaintiff is not entitled to recovery of this amount.
(a) A holistic reading of the plaint makes it appear that plaintiff knocked the doors of this Court for recovery of losses sustained due to nonissuance of FormC. However, in its replication, plaintiff turned around to say that this amount was due on account of not only the losses for nonissuance of FormC but also for nonpayment of goods supplied. This contradiction in plaintiff's stance is quite material and damaging. It does appear that the plaintiff switched stands in response to the averments in the written statement of the defendant. It only goes to show that the plaintiff is not clear as to what precisely it is suing the defendant for.
(b) Secondly, if the aforesaid amount of Rs. 1,55,732.54/ is due on account of losses for not furnishing FormC and also for nonpayment for goods supplied, then it was incumbent upon the plaintiff to have precisely disclosed as to what was the exact amount due on account of nonpayment of goods supplied and the exact amount due for losses sustained for not furnishing FormC.
(c) Alternatively, going solely by the plaint, the losses sustained were only for not furnishing FormC. In this backdrop, plaintiff was required to precisely disclose the exact amount of losses. Plaintiff has not done the needful in this regard. In the plaint, it merely states that 'after deducting the security deposit and the credit balance from the running account of the defendant, maintained by the plaintiff, a sum of Rs. 1,55,732.54/ is due and payable' by the defendant along with interest thereon. From CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 7 of 16 a bare reading of the plaint, it is not clear as to from what specific amount was the security deposit and the credit balance deducted so as to arrive at the magic figure of Rs. 1,55,732.54/. If not the total losses, plaintiff ought to have at least disclosed the outstanding credit balance that was subtracted. It appears that plaintiff has left it for this Court to decipher for itself the exact amount of losses in this regard.
(d) Losses on account of non issuance of FormC can be sustained only if the plaintiff company proves on record that it had supplied goods to the defendant and shows the invoices thereof. However, the plaintiff company was not able to show any invoice issued under its name to the defendant for which the corresponding FormC was allegedly not issued. It is only when the plaintiff company shows in the first place that for a particular invoice issued by it, the defendant had not given FormC, that it could be said that it had sustained losses. In the absence thereof, there can never arise any question of such losses. Not even a single invoice, for which FormC was allegedly not issued, was exhibited or proved on record by the plaintiff.
(e) On record, there are copies of 12 invoices which are Mark A (colly). These invoices have been issued by 'M/s Sharad General Traders' to the defendant. These invoices range from 22nd March, 2004 till 18th March, 2005. PW1 admits these invoices to have been issued by 'M/s Sharad General Traders'. And therefore, when these invoices were issued in the name of 'M/s Sharad General Traders', the defendant, under the law, cannot possibly be asked to issue FormC in the name of a person other than the supplier of goods as reflected in the invoices.
(f) PW1 in his evidence deposes that M/s Sharad General Traders was a partnership firm prior to 1997 when it got 'merged' with the plaintiff company. He CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 8 of 16 also deposes that postmerger, it stood 'deleted' from the records of Sales Tax and Income Tax. The point therefore is why were the invoices issued in the name of M/s Sharad General Traders in 20042005, when it ceased to exist postmerger in 1997 and stood 'deleted' from Sales Tax record? FormC is issued under Central Sales Tax (Registration and Turnover) Rules, 1957. And therefore, when a firm is no longer in existence and its Sales Tax record already stands deleted, then how could FormC under Central Sales Tax (Registration and Turnover) Rules, 1957 be demanded in its name?
(g) In the same breath, PW1 also deposes that M/s Sharad General Traders 'is' a unit of Stanvac Chemicals India Ltd. This portion of testimony of PW1 cannot be reconciled with that as noted in the preceding subparagraph. It is one thing to say that an entity no longer exists, but it is an altogether different thing to state that the entity continues to exist as an unit of the company. In any event of the matter, if M/s Sharad General Traders continues to be a unit of the plaintiff company, then the latter is required to explain as to in what legal capacity the former continues to be in existence so much so that separate invoices are issued in its name and separate Form C is demanded in its name. Whether M/s Sharad General Traders is in existence as a proprietorship firm, or a partnership firm, or a limited liability partnership firm, or a limited company? A company may have different branch offices, but under the Company Law, a company may not have different disparate units so much so that different accounts, different records, different FormC and different invoices are maintained for them. In a company, in the final analysis, the entire account has to be audited as one. The balance sheet, cash flow statement, profit and loss account are CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 9 of 16 required to maintained as one. Any goods supplied or purchased by the company has to be in the name of the company. Outflow or inflow of money has to reflected in the accounts of the company and not in the name of a disparate unit. Simply put, a company cannot set up a ghost unit to create obfuscation. And if it does so, it has to suffer the consequences thereof. The old saying, 'As you sow, so shall you reap' applies squarely to the plaintiff. Having started issuing invoices in the name of M/s Sharad General Traders, plaintiff cannot seek FormC in the name of a person other than the name of the supplier of goods as reflected therein.
(h) Furthermore, the case was filed on the basis that FormC for 200405 and 200506 has not been issued. However, PW1 in his crossexamination took a wavering stand. He stated that he had a 'doubt' as to whether any FormC has been 'received' or not for the financial years 200405 and 200506. That is to say, PW1 did not categorically state that form 'C' had not been issued. He rather stated that he had 'doubts' as to whether they were 'received'.
(i) PW1 deposes that on 01.04.1997 M/s Sharad General Traders along with three more firm were merged in the plaintiff company. However, merger of a firm with a company cannot take place without following the requisite standards mandated by law. When a company takes over a firm, it takes over all its assets and liabilities. This in effect means that the necessary changes in the balance sheets on the asset side and on the liability side and the other accounts have to be made. There has to be an authorisation from the Board of Directors also.
(j) The aforesaid twelve invoices {Mark A (colly)} of M/s Sharad General Traders bears the Sales Tax registration number of the plaintiff company. PW1 CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 10 of 16 admits this fact. Now, how could the plaintiff company lend its Sales Tax registration number in such a manner, if M/s Sharad General Traders is no longer in existence? Alternatively, the Sales Tax registration number was allotted to the plaintiff to use it, inter alia, for the invoices issued under its name and not to (mis)use it by issuing invoices by creating a ghost firm.
(k) And lastly, Plaintiff's counsel suggested to DW1 in his crossexamination (dt. 04.03.2014) that plaintiff had returned FormC to defendant for correction. This is what DW1 replied, "It is correct that plaintiff company has returned the Cform to defendant firm for necessary rectification. It is correct that in letter Ex. DW1/PWX dated 19.01.2007 written by Mr. Y. S. Bhandari, same has been shown to me and it was acknowledge by defendant's firm. It is correct that we have got done the necessary corrections from the concerned department. Vol. however, later on you have asked the Cform in the name of the plaintiff company." Therefore, what is abundantly clear is that the plaintiff had been issued FormC, but it returned the same for some corrections and it again returned the same for corrections in the name of supplier of goods. The point therefore is that the position which the plaintiff now takes in the form of suggestions to DW1 is quite contrary to what was averred in the plaint. In the plaint, it was simply averred that FormC had not been issued (and even this averment was inconsistent for in the replication there was a change of stands). Nonetheless, it bears repetition to state that FormC cannot be issued in the name of a person other than the one shown to be supplier of goods in the invoices. (21) For the aforesaid multiple reasons, I hold that plaintiff has miserably failed to prove this issue. This issue is decided against plaintiff.
CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 11 of 16 (22) Issue no. 4 - This issue concerns the interest that is to be awarded to the plaintiff on the suit amount. Decision on issue no. 3, a fortiori, entails that the plaintiff is not entitled to any interest. This issue is decided against the plaintiff and in defendant's favour. (23) Issue no. 1 - The issue is whether the plaintiff proves that its suit has been filed by a duly authorised person. In terms of Order XXIX Rule 1, CPC in suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case. In Mahanagar Telephone Nigam Limited vs. Smt. Suman Sharma 2011 (I) AD (Delhi) 331 it has been held that once the person who signs and verifies the plaint is a principal officer then it ought to be held that the suit is validly instituted. In the case at hand, Sh. Manoj Kumar Jha is neither the secretary of the plaintiff company nor its director. He is also not the principal officer of the plaintiffcompany. At least, there is no evidence to the effect that being the Accounts Manager, he assumes the role of principal officer of the plaintiff. Therefore, it is held that Sh. Manoj Kumar Jha was not authorised to sign and verify the pleadings on behalf of the plaintiff company and file the suit. This is apart from the fact that the copy of Board Resolution Ex. PW1/2 in favour of Sh. Manoj Kumar Jha stands not proved. This issue is decided against the plaintiff and in favour of the defendant.
(24) Issue no. 5 - The issue is whether the defendant proves that it is entitled to recover Rs. 25,459.65/ from the plaintiff by way of counterclaim.
(25) Insofar as the claim to Rs. 459.65/ is concerned, it is my view that the same has to be allowed. As per the defendant, the amount of Rs. 459.59/ (In the counterclaim prayer clause and the paragraph preceding it, the excess amount paid is shown to be Rs. 459.59/ CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 12 of 16 only; whereas in the heading of the counterclaim the excess amount paid is shown to be Rs. 459.65/) is the excess amount paid in the last and final transaction in the form of advance payment of Rs. 37,000/ via ICICI Bank current account, although the invoice (bearing no. DD424303) was for Rs. 36,967.47/ only. Section 58, Evidence Act mandates that an admitted fact need not be proved. Plaintiff in its statement of account Ex. PW1/4 admits that this amount of Rs. 459.65/ is actually due and payable to the defendant M/s Penta Control. In its very first entry dated 01.04.2006 in the statement of accounts Ex. PW1/4, plaintiff has shown an amount of Rs. 459.65/ on the credit side; meaning thereby that the same is due and payable to the defendant M/s Penta Control. On the anvil of section 58, Evidence Act, this amount has to be allowed. In view of the admissions, no further proof on this count, to my mind, is thus necessary. This Court, therefore, holds that the plaintiff is liable to pay Rs. 460/ (rounded off figure) to the defendant M/s Penta Control.
(26) The defendant also claims back its security of Rs. 25,000/ that it had paid to the plaintiff at the time of inception of business transactions. In its counterclaim (para 2 thereof) defendant states that it had made cash payment of Rs. 25,000/ to the plaintiff as security deposit. Plaintiff, in the written statement to the counterclaim (in the corresponding para) states that the same is a matter of record. This effectively means that plaintiff does not dispute defendant's assertion that cash deposit of Rs. 25,000/ was made as security. It is curious to note that in the plaint, the security was stated to be Rs. 50,000/ which the defendant had admitted in its written statement.
(27) Business transaction between the parties has admittedly snapped. Defendant, in para 3 of the counterclaim, states that the agreement (for business) was renewed after every one year and was continued so up till 2006. Plaintiff in the written statement to the counterclaim CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 13 of 16 (in the corresponding para) again states that the same is a matter of record. (28) And therefore, I see no reason as to why the defendant can be precluded from recouping this amount of Rs. 25,000/. The defendant is certainly entitled to claim back this amount from the plaintiff.
(29) Plaintiff took an objection that without proper authorisation the counterclaim could not have been filed. Defendant M/s Penta Control is certainly not a company under the Companies Act. And therefore, there is no question of applying Order XXIX Rule 1, CPC to the counterclaim to see whether the same has been filed by a duly authorised person. Defendant M/s Penta Control is neither a partnership firm so as to invite the application of section 69, Partnership Act. Plaintiff has taken no such objection in its written statement to the counterclaim and neither is there any evidence to show that M/s Penta Control is a partnership firm. On the contrary, in its authorisation letter in favour Y. S. Bhandary, defendant has described itself to be a proprietorship firm. That apart, the plaintiff, who had the brought the lis in the first instance, did not describe the status of the defendant anywhere in its plaint. Had there been an averment in the plaint to the effect that the defendant is a partnership firm, then possibly there could have been some ground to carry forward the same in the trial. Nonetheless, I find that on this aspect there is no absolutely suggestion put to DW1 that he was not authorized to institute the counterclaim. This objection is thus sans any merit.
(30) This issue is decided in favour of the defendant/counterclaimant by holding that it is entitled to claim Rs. 25,460/ (rounded off figure) from the plaintiff M/s Stanvac Chemicals (India) Limited.
(31) Issue no. 6 This issue concerns the interest that is to be awarded to the defendant on CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 14 of 16 the counterclaim amount. The transaction is commercial one. However, the Apex Court in a line of judgments has held that in view of changed economic scenario where there has been consistent fall in rates of interest, Courts must in accordance with the changed circumstances grant lesser rates of interest. These judgments are Rajendra Construction Co. v. Maharashtra Housing & Area Development Authority & Ors., 2005(6) SCC 678, McDermott International Inc. v. Burn Standard Co. Ltd. & Ors., 2006 (11) SCC 181, Rajasthan State Road Transport Corporation v. Indag Rubber Ltd., (2006) 7 SCC 700, Krishna Bhagya Jala Nigam Ltd. v. G.Harischandra, 2007 (2) SCC 720 and State of Rajasthan Vs. Ferro Concrete Construction Pvt. Ltd., (2009) 3 Arb. LR 140 (SC). To similar effect is Delhi High Court decision in M/s Jindal Realcon Pvt. Ltd & Ors . v. M/s Laxmi Narain Ram Dass & Co., (dt. of decision March 22, 2013 in RFA No.245/2012). (32) In my view, pendente lite (pendente lite with effect from 03.11.2007) and future interest of 9% per annum on the amount of Rs. 25,460/ (rounded off figure) would suffice. This issues thus stands decided in favour of defendant/counterclaimant M/s Penta Control and against the plaintiff M/s Stanvac Chemicals (India) Limited. (33) Issue no. 7 The issue is whether the plaintiff proves that defendant's counterclaim is time barred. Defendant's counterclaim is certainly not time barred. The claim to security deposit of Rs. 25,000/ cannot be said to time barred for the reason that the business transaction between the parties admittedly snapped in 2006 and the counterclaim was filed on 03.11.2007. It is from the date of snapping of business transactions between the parties that the limitation would start to run and not from the date when the security was initially deposited. Claim to excess payment (Rs. 459.65/ or Rs. 459.59/) is also not time barred for CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 15 of 16 the reason that the business transaction between the parties continued till 2006 and the plaintiff in its own statement of accounts Ex. PW1/4 shows amount of Rs. 459.65/ to be due as on 01.04.2006. And thus, the plaintiff has miserably failed to show that the counterclaim amount is time barred. I thus decide this issue in favour of defendant/counterclaimant M/s Penta Control and against the plaintiff M/s Stanvac Chemicals (India) Limited. (34) Relief - In the light of findings on the aforesaid issues, plaintiff's suit stands dismissed. There shall be no order as to costs in the suit of the plaintiff M/s Stanvac Chemicals (India) Limited. The counterclaim of the defendant M/s Penta Control stands decreed in the sum of Rs. 25,460/ (rounded off figure) together with pendente lite (pendente lite with effect from 03.11.2007) and future interest at the rate of 9% per annum thereon. Costs of the counterclaim awarded to the defendant M/s Penta Control. Decree sheet be prepared. File be consigned to record room.
Announced in the open court (M.P. SINGH)
Dated:29.08.2014 Senior Civil Judge/Rent Controller (East)
Karkardooma Courts, Delhi
CS no. 1729/06 M/s Stanvac Chemicals (I) Ltd. v. M/s Penta Control Page 16 of 16