Delhi District Court
M/S. Kartar Carriers Pvt. Ltd vs M/S. Jindal Textiles on 15 November, 2007
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IN THE COURT OF SH. SATISH KUMAR ARORA, CIVIL JUDGE, DELHI
SUIT NO : 403/02/95
M/s. Kartar Carriers Pvt. Ltd.
Fleet owners & Transport Contractors,
Montgomery House, 3968 Roshnara Road,
Delhi - 110 007.
..........Plaintiff
Versus
1. M/s. Jindal Textiles,
1313-A, Katra Dhulia,
Chandni Chowk, Delhi - 110 006.
2. Mr. Kamal Jindal,
Prop. Jindal Textiles,
R/o H. No. 841-WS,
Hargobind Niwas,
Rishi Nagar, Rani Bagh,
Delhi.
..........Defendants
Date of Institution : 06.03.1995
Date of Judgment : 15.11.2007
SUIT FOR RECOVERY
JUDGMENT
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1. Plaintiff, M/s. Kartar Carriers Pvt. Ltd. (earlier M/s. Kartar Carriers, a partnership firm) has filed the suit for the recovery of Rs. 1,54,218/- (Rupees One Lac Fifty Four Thousand Two Hundred and Eighteen Only) along with interest against the defendants. Defendant no. 1 is M/s. Jindal Textiles whereas, defendant no. 2 Sh. Kamal Jindal is the proprietor of defendant no. 1. Briefly stated the facts of the case are as under : Initially, the suit was filed by the plaintiff in the capacity of being a partnership firm duly registered under the Indian Partnership Act. However, during the pendency of the proceedings in the present suit, an application under Order VI Rule 17 of the Code of Civil Procedure (hereinafter referred to as the Code) was preferred by the plaintiff praying therein that during the pendency of the proceedings, the plaintiff has been converted from a partnership firm to a private limited company registered under the Indian Companies Act, 1956. The said application was allowed vide order dated 08.09.1997. Plaintiff, thus claims to be a private limited company duly incorporated and registered under the Indian Companies Act and engaged in the business of transportation of goods within the Union of India. Sh. Harmohinder Singh, being one of the Directors of the plaintiff company, is competent to sign and verify the pleadings and to Page 2 of 35 -:3:- institute and prosecute the suit for and on behalf of the plaintiff company against the defendants. It is stated that the plaintiff company was earlier a partnership firm carrying on the business as above stated under the name and style of M/s. Kartar Carriers with almost same persons as partners, who have taken over the charge of the new company i.e. M/s. Kartar Carriers Pvt. Ltd., (fleet owners and transport contractors) as Directors thereof with all assets, liabilities and reputation and business of the aforesaid firm.
It is stated that in the ordinary course of its business, the Bombay booking office of the plaintiff company was entrusted with textile goods by various textile mills for transportation and delivery to the defendant no. 1 at Delhi against various good receipts (GRs). It is further stated that even though the goods were to be delivered at destination by the plaintiff only against the presentation of the valid document of discharge i.e. the good receipt, however in special circumstances, the goods were delivered on special request and assurance of the consignee that the goods receipt shall be surrendered on receipt at any later date. Further, this assurance was coupled with the fact that in the event of failure to surrender the GRs, the consignee shall either reimburse the transporter (plaintiff herein) or the consignor, of the invoice Page 3 of 35 -:4:- value of the goods.
2. It is stated that as per the above said, there was a written request from the defendant no. 2, being the proprietor of defendant no. 1, to deliver the goods without the surrender of GR at the time of delivery of the goods. The plaintiff acting on the assurance of the defendant no. 2, delivered the consignments of various textile mills (consignors) to the defendant no. 1 as per the following details :-
GR Nos. 272327, 272399, 272400-403 of M/s. Anand Textiles, Bombay, Inv. Value : Rs. 58,864.40/- GR Nos. 283366-67 dated 07.03.1992 of M/s. Raj Kumar Textiles, Bombay, Inv. Value : Rs. 24,003.25/- GR Nos. 290412 dated 18.04.1992 of M/s. Santotex Silk Industries, Bombay, Inv. Value : Rs. 14,786.40/-
Total Invoice Value : Rs. 97,654.05/-
It is stated that the defendant no. 2 neither surrendered the goods receipts/GRs of the above consignments duly received by defendant no. 1, nor made any payment of the invoice value of the goods either to the plaintiff or to Page 4 of 35 -:5:- the consignors thereof as detailed above. It is thus stated that the plaintiff had delivered the goods in good faith and was having reasons to believe that the defendant no. 2 will honour his words and assurance by surrendering the GRs or paying the invoice value of the consigned goods.
3. That the plaintiff, being under an obligation to reimburse the consignor's of the value of the consigned goods, called upon the defendants to pay the value of the goods. After great persuasion, the defendant no. 2 paid a sum of Rs. 5,000/- only, in cash, in the month of September, 1994 and further assured the plaintiff to clear the balance sum at the earliest.
It is thus stated that the plaintiff having passed on the consigned goods to the defendants is lawfully entitled to the compensation thereof to the extent of invoice value and interest thereon @ 21% per annum, which is the prevalent rate of interest. Even a legal notice of demand dated 08.02.1995 was sent by the plaintiff to the defendants which was deliberately not accepted by the defendants as the registered cover was returned back with the remarks "closure of the firm" despite the fact that the defendant no. 2 continues to work from the same place. The plaintiff, therefore feeling aggrieved is before Page 5 of 35 -:6:- this court for the recovery of Rs. 1,54,218/-, the break up of the same is as under :-
(i) Rs. 92,654/- towards the principal amount of the invoice value of goods after adjustment of Rs. 5,000/- received;
(ii) Rs. 61,014/- towards the interest @ 21% per annum from date of delivery till 28.02.1995; and
(iii) Rs. 550/- towards the notice charges.
4. The defendant no. 2, being the proprietor of defendant no. 1, filed the written statement and raised a preliminary objection that the present suit of the plaintiff is patently barred by limitation as admittedly in the plaint, it has mentioned the years as 1991 & 1992 for the transactions/consignments and the suit having been filed in the year 1995 is clearly barred by way of limitation. Another preliminary objection was raised that there is no cause of action against the defendants as the defendant no. 2 being the proprietor of defendant no. 1 was having direct dealings with the consignors and had made the entire payment towards the consigned goods. It is further stated that the plaintiff is only a transporter and carries the goods on transportation charge basis from Page 6 of 35 -:7:- Bombay to Delhi and whatever goods are sent by the consignors through the plaintiff, the plaintiff is entitled only to collect the transportation charges and the plaintiff having collected the said charges from the defendants, is having no cause of action against the defendants. The Good Receipts/GRs as alleged by the plaintiff were denied. Further, the payment of Rs. 5,000/- in cash in the month of September, 1994 is also denied. The assurance of making the balance payment is again denied. Thus, the defendants, in view of the aforesaid prays for dismissal of the plaintiff's suit with exemplary cost.
5. The plaintiff filed his replication to the written statement of defendant whereby the contents of the plaint were reiterated and reaffirmed and the allegations of the defendant were denied as incorrect.
6. On 10.04.2001, following issues were framed :-
(1) Whether the suit of the plaintiff is barred by limitation? OPD (2) Whether the plaintiff has any cause of action against the defendant? OPP (3) Whether the suit of the plaintiff is bad for the surrender or non-joinder of necessary parties?
Page 7 of 35 -:8:- (4) Whether there is no privity of contract between the plaintiff and the defendant? OPD (5) Whether the plaintiff is entitled to recover the suit amount? OPP (6) Whether the plaintiff is entitled to recover the interest? OPP (7) Relief.
7. In support of its case, plaintiff in its evidence examined Sh. Harmohinder Singh, one of the Directors of the plaintiff company, as PW-1 and on the part of the defendants, Sh. Kamal Jindal, proprietor of the defendant no. 1 was examined as DW-1. I have heard the respective submissions of the ld. counsel for the parties and perused the record carefully. The findings on the issues are as under.
ISSUE NO. 1 - Whether the suit of the plaintiff is barred by limitation? OPD
8. The onus to prove this issue was on the defendants. Ld. counsel for the defendants refers to para no. 4 of the amended plaint wherein it has Page 8 of 35 -:9:- been stated that the goods that were delivered to the defendant were with respect to the following GRs :-
(i) GR Nos. 272327, 272399, 272400 - 272403 of M/s. Anand Textiles, Bombay - Invoice value of Rs. 58,864/-;
(ii) GR Nos. 283366 - 67 dated 07.03.1992 of M/s. Rajkumar Textiles, Bombay - Invoice value of Rs. 24,003.25/-; and
(iii) GR Nos. 290412 dated 18.04.1992 of M/s. Santotex Silk Industries, Bombay - Invoice value of Rs. 14,786.40/-.
As to GRs mentioned in the above stated point no. (i), the date of the GRs has not been mentioned, however the same could be inferred from the document which is Ex. P-21 filed and proved on behalf of PW-1 wherein, the date of the said GRs is shown as 16.12.1991. As to GRs mentioned in the above stated point no. (ii), all are admittedly dated 07.03.1992 and as to GR mentioned in the above stated point no. (iii), the same is dated 18.04.1992. As to the GRs dated 16.12.1991, the same are beyond the period of limitation of three years as the present suit of the plaintiff has been filed on 06.03.1995. As to the other GRs as stated above in point no. (ii) & (iii), the same are within the period of limitation of three years. Ld. counsel for the plaintiff contends Page 9 of 35
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that even the GRs dated 16.12.1991 are within the period of limitation for the reason that, as stated in para no. 7 of the plaint, the plaintiff paid a sum of Rs. 5,000/- in cash in the month of September, 2004 as a part payment towards the goods delivered with respect to the above stated GRs. Ld. counsel for the plaintiff submits that in view of the Section 18 and Section 19 of the Limitation Act, 1963, this is an acknowledgment of debt/liability by the defendant and therefore, a fresh period of limitation begins to run even in respect of the GRs dated 16.12.1991. To this, ld. counsel for the defendant contends that the said alleged payment of Rs. 5,000/- in cash which has been shown in the statement of account of the plaintiff's books of account is not an acknowledgment within the meaning of Section 18 and Section 19 of Limitation Act, 1963. Reference can be made to the said Sections of the Limitation Act, 1963. Section 18 while providing for the effect of acknowledgment in writing, lays down - (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 Page 10 of 35
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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, oral evidence of its contends 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 of 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 authorized 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.
9. In view of the above stated provision of Section 18 of the Page 11 of 35
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Limitation Act, 1963, the alleged acknowledgment of Rs. 5,000/- made in the statement of account of the defendant in the plaintiff's books of account is to be appreciated. Clearly, the alleged acknowledgment/entry in the statement of account maintained by the plaintiff company is neither an acknowledgment as stated in Section 18 of the Limitation Act nor it is having any signatures of the defendant or his agent as required for the applicability of Section 18 of the Act. Had it been the plaintiff's case that the said payment of Rs. 5,000/- was made by the defendant by way of cheque, the plaintiff's case would definitely have come under the purview of Section 18 of the Act. Since this is not so in the present case, therefore, Section 18 of the Act does not come to the plaintiff's rescue with respect to the GRs dated 16.12.1991.
10. Coming on to Section 19 of the Act, it provides for the effect of payment on account of debt or of interest on legacy. Section 19 of the Act lays down - Where payment on account of a debt or of interest on a legacy is made before the expiration of the prescribed 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. Page 12 of 35
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Provided that, save in the case of payment of interest made before the first 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 -
(a) Where mortgaged land is in 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.
Law is very clear as to the essentials of Section 19 of the Act. To claim exemption under Section 19 of the Act, 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. The ground of exemption is not complete without the second element and unless both these elements are proved to exist at the date of filing of the plaint, the suit would be held to be time barred. According to the proviso to Section 19 of the Act, the acknowledgment of the payment has to be in the handwriting of or in the writing signed by the person making the payment. Page 13 of 35
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11. In the present case, there is nothing in the writing of the defendant so as to amount to an acknowledgment under Section 19 of the Act. The alleged acknowledgment/entry in the statement of account of the defendant's concern maintained by the plaintiff company, clearly lacks the second element as stated in Section 19 of the Act. Reference can also be made to the judgment of the Hon'ble Supreme Court of India in Sant Lal Mahton Vs. Kamla Prasad & Ors. AIR 1951 Supreme Court, wherein it was observed that "to claim exemption under Section 20 of the Limitation Act, 1908 (equivalent to Section 19 of the Limitation Act, 1963), 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 has been acknowledged in writing in the manner contemplated by that section. The ground of exemption is not complete without this second element and unless both these elements are proved to exist at the date of the filing of the plaint, the suit would be held to be time barred". In view of the same, the GRs dated 16.12.1991 can not be said to be within the period of limitation on account of the entry made in the statement of account. To this, ld. counsel for the plaintiff submits that the period of limitation with respect to the GRs dated Page 14 of 35
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16.12.1991 is to begin from the delivery of the consigned goods. Reference is made to Ex. P-4 wherein the defendant no. 2 for and on behalf of defendant no. 1 is making a request to the plaintiff to deliver the goods with respect to GR no. 272401 with the assurance that the builty shall be released thereafter.
Ex. P-4 is dated 28.01.1992. Reference is also made to Ex. P-5 which is again a request to deliver the consigned goods with respect to GR no. 272403 and is dated 14.02.1992. Reference is again made to Ex. P-8 and Ex. P-9 which are again requests to deliver the consigned goods with respect to GR no. 272402 and GR nos. 272327, 272399 and 272400 respectively. Ex. P-8 & Ex. P-9 are dated 14.03.1992 and 30.12.1991 respectively. Ld. counsel for the plaintiff, after making reference to the exhibits Ex. P-4, P-5, P-8 & P-9, contends that dates in the said exhibits are within the period of limitation and therefore the claim of the plaintiff with respect to the GRs as stated in the Ex. P-4, P-5, P-8 & P-9 is maintainable. This contention of the ld. counsel for the plaintiff is untenable for the reason that the claim of the plaintiff with respect to the consigned goods as to the GRs Nos. 272327, 272399, 272400 - 403 all dated 16.12.1991 arises on account of the fact that the plaintiff acting on the assurance made by the defendant no. 2 for and on behalf of the defendant no. Page 15 of 35
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1, delivered the consigned goods in breach of the settled terms of consignment as stated by the plaintiff itself in the plaint. Therefore, the cause of action with respect to the above stated GRs in respect of plaintiff shall begin from date stated on the GRs and not from the date of delivery. The same is substantiated by the fact that plaintiff was a mere transporter and was assigned the duty by the consignors' to deliver the consigned goods to the defendants on time and as per the terms of the consignment. If the plaintiff would have been the consignor himself, the cause of action would have definitely arisen on the dates of the delivery of the consigned goods.
In view of the aforesaid, I hold that the plaintiff's claim with respect to GR Nos. 272327, 272399, 272400 - 403 of M/s. Anand Textiles, Bombay dated 16.12.1991 for the invoice value of Rs. 58,864.40/- is time barred. The issue no. 1 is decided accordingly.
ISSUE NO. 2, 3 & 4 -Combined findings on the issue no. 2, 3 & 4 as the same are interrelated.
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12. The onus to prove these issue was both on the plaintiff as well as the defendants. It is admitted that the plaintiff is a transporter having been assigned the work of transporting the goods/consignment from the consignors' in Bombay to the defendant no. 1/consignee in Delhi. It is the plaintiff's case, as stated in para no. 3 of the plaint, that in the ordinary course of business the goods are to be delivered at destination by the plaintiff only against the presentation of the valid document of discharge i.e. the goods receipt.
Even in one of the documents filed on behalf of the plaintiff, which is a complaint against the plaintiff herein filed by one of the consignors seeking compensation on account of negligence and deficiency in services, it has been stated that the goods were to be released by the plaintiff to the defendant only when the payment has been made by the defendant to the concerned bank and the documents obtained from the bank by the defendant were shown/handed over to the plaintiff herein. It is further stated in the complaint that the plaintiff herein had made a breach of the above stated and has delivered the goods to the consignee (defendant herein) without obtaining the necessary documents.
From the above said, the position become clear that the plaintiff Page 17 of 35
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has delivered the consignments to the defendant without following the procedure and thus, making a breach of the agreement as entered into between the plaintiff and the consignors at Bombay. To come out of this, it is the plaintiff's case that in special circumstances, the goods are delivered on special request and assurance of the consignee that the goods receipt shall be surrendered on receipt at any later date. Therefore, the onus is on the plaintiff that special circumstances existed in the present case and it was only on the special request of the defendant herein, that the goods were delivered by the plaintiff to the defendant without following the terms of the agreement. For this, the examination-in-chief and cross-examination of PW-1, Sh. Harmohinder Singh, who happens to be one of the Directors of the plaintiff company, is to be appreciated. PW-1 in his evidence by way of affidavit Ex. PW-1 (not mentioned on the affidavit) deposed that it was on the request letters of the defendant no. 2, exhibited as Ex. P-4 to Ex. P-9 respectively that the consigned goods were delivered to the defendant no. 1 without following the settled terms of consignment. The said exhibits Ex. P-4 to Ex. P-9 are in Hindi transcript and are alleged to be signed by defendant no. 2 in the capacity of being the proprietor of defendant no. 1 M/s. Jindal Textiles. The said Page 18 of 35
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exhibits are addressed to the Manager, Kartar Carriers (i.e. the plaintiff herein). In the said exhibits, a request is made that the goods pertaining to MRs (GRs) mentioned therein be released first to the labourers of the defendant with the assurance that builty (necessary documents of consignment) after being obtained from the bank will be released to the plaintiff. Ex. P-4 is with respect to MR/GR No. 272326, 272328 and 272401. Ex. P-5 is with respect to MR/GR No. 272329, 272330 and 272403. Ex. P-6 is with respect to MR/GR No. 290412. Ex. P-7 is with respect to MR/GR No. 283366 and 283367. Ex. P-8 is with respect to MR/GR No. 272402 and Ex. P-9 is with respect to MR/GR No. 270922, 272327, 272399 and 272400.
The GR No. (consignment note no.) 272403 dated 16.12.1991 which is the plaintiff's copy has been exhibited as Ex. P-10. In Ex. P-10, the consignor's name and address has been shown as Anand Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 290412 dated 18.04.1992 is exhibited as Ex. P-11. In Ex. P-11, the consignor's name and address has been shown as Santotex Silk Industries and the consignee's bank name and address has been shown as "Central Bank of India". The GR No. (consignment note no.) 283367 dated Page 19 of 35
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07.03.1992 is exhibited as Ex. P-12. In Ex. P-12, the consignor's name and address has been shown as Rajkumar Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 283366 dated 07.03.1992 is exhibited as Ex. P-13. In Ex. P-13, the consignor's name and address has been shown as Rajkumar Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 272402 dated 16.12.1991 which is the plaintiff's copy has been exhibited as Ex. P-14. In Ex. P-14, the consignor's name and address has been shown as Anand Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 272401 dated 16.12.1991 which is the plaintiff's copy has been exhibited as Ex. P-15. In Ex.
P-15, the consignor's name and address has been shown as Anand Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 272327 dated 16.12.1991 which is the plaintiff copy has been exhibited as Ex. P-16. In Ex. P-16, the consignor's name and address has been shown as Anand Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 272399 dated 16.12.1991 which is the plaintiff's copy has been exhibited as Page 20 of 35
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Ex. P-17. In Ex. P-17, the consignor's name and address has been shown as Anand Textiles and the consignee's bank name and address has been shown as "Self". The GR No. (consignment note no.) 272400 dated 16.12.1991 which is the plaintiff's copy has been exhibited as Ex. P-18. In Ex. P-18, the consignor's name and address has been shown as Anand Textiles and the consignee's bank name and address has been shown as "Self".
PW-1 after making a reference of the request letters Ex. P-4 to P-9 and of the GR numbers/consignment notes Ex. P-10 to P-18 respectively, deposes that the defendant has failed to make the payment with respect to the above said GRs despite his request letters as above stated, therefore, the plaintiff is having a valid cause of action against the defendant even though the plaintiff is itself guilty of breach of the settled terms of agreement of consignment. In his cross-examination, when a question was put to PW-1 that in your affidavit in evidence, you have stated that the proprietor of the defendant firm i.e. the defendant no. 2 gave a request letter to the plaintiff with the assurance that in the event of failure to pay the cost of the goods, the plaintiff shall become liable to claim the said amount, to this, PW-1 deposes that it is correct that the same is not mentioned in Ex. P-4 to Ex. P-9 and the Page 21 of 35
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same was agreed between the parties verbally. PW-1 further deposes that he received letters from the consignors' that the defendant firm has not made the payment to them with respect to the consignment. However, no such letter has been placed on record by the plaintiff. PW-1 however refers to Ex. PW- 1/D1, which was the affidavit of the plaintiff's company in the complaint case filed by one of the consignors, wherein it has been stated on oath that the goods were delivered to the defendant on the representation and in good faith that the defendant had made the direct payment of the price of the goods to the consignor. Reference can also be made to the averments made by the defendants in their written statement as well as to the testimony of DW-1, Sh. Kamal Jindal, who happens to be the proprietor of the defendant no. 1. In para no. 2 under preliminary objections, it is stated that defendant no. 2 being proprietor of M/s. Jindal Textiles (defendant no. 1) was having direct dealings with M/s. Anand Textiles, M/s. Rajkumar Textiles and M/s. Santotex Silk Industries respectively. In para no. 4 of the written statement, it is stated that "plaintiff is only a transporter and carries the goods on transportation charges basis from Bombay to Delhi, and whatever goods sent by the said parties to this transporter, he is entitled to collect the transportation charges which he Page 22 of 35
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had already collected from the defendant vide separate receipts which were duly executed by the plaintiff and are very much in the possession of the defendants and nothing is due towards the transportation charges to the plaintiff............."
From this, it becomes clear that the transaction of consignment between the defendants and the consignors' through the plaintiff as a transporter, as stated by the plaintiff in his plaint, is not denied by the defendants. Further, the delivery of the consigned goods is also not denied. What is denied is that the defendants have received the goods and has made the entire payment to the above said consignors and nothing is due towards the plaintiff herein. Once the transaction/receiving of the consigned goods is not denied by the defendants through the plaintiff, the onus shifts upon the defendants to prove that the payment towards the consigned goods has already been made by the defendants to the respective consignors'.
13. In his cross-examination, DW-1, Sh. Kamal Jindal deposes that he has made full and final payment regarding the GRs forming the subject matter Page 23 of 35
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of the suit to the concerned parties/consignors. He further deposes that he has made the payment to the concerned parties within 60-90 days after receipt of the material from both the parties. When a question was put to him as to whether he can show the relevant ledger books pertaining to the payment made to the consignors, an evasive reply comes from DW-1. DW-1 deposes that the relevant ledger books along with the material of his shop was eaten by white ants, therefore, he is not having the record to show that he has made the entire payment. Another question was put to him as to how he has made the payment against GR No. 272327, DW-1 deposes that he does not know as to how he has made the payment, he further deposes that he is having no record with regard to any of the payments made to the three mills (consignors). From the above said testimony of DW-1, the defendants have failed to show that entire payment with respect to the GRs in issue in the present suit has been made to the concerned consignors. On the other hand, plaintiff has been able to show that (i) it transported the consigned goods from the consignors at Bombay to the defendants at Delhi; (ii) that the consigned goods were delivered by the plaintiff in breach of the settled terms of the agreement of the consignment; (iii) that the consigned goods were delivered to the defendants Page 24 of 35
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by the plaintiff on good faith and on representations made by the defendants through request letters Ex. P-4 to Ex. P-9 wherein, the defendant no. 2 gave the assurance to the plaintiff that the builty after being obtained from the bank will be delivered to the plaintiff; and (iv) that the defendant neither handed over the documents of consignment obtained from the bank to the plaintiff nor made the direct payment to the consignors'.
From the above said, it becomes clear that the plaintiff is having a valid cause of action against the defendants. As to whether there is any privity of contract between the plaintiff and the defendants, the plaintiff places reliance upon the following documents :-
(i) Request letters Ex. P-4 to P-9 written by defendant no. 2 to the plaintiff giving assurance that the documents of consignment (builty) will be released after it being obtained from the bank. Plaintiff acting on the said representation, delivered the goods to the defendants in breach of the settled terms of consignment;
(ii) Ex. PW-1/D1, which is the affidavit filed on behalf of the plaintiff herein in a complaint case instituted by the consignor M/s. Santotex Silk Industries for compensation as the plaintiff herein has delivered the goods to the Page 25 of 35
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consignee/defendants without taking the consignment papers (through bank) from the defendants. Through this document, plaintiff again is successful in showing that it is having a valid claim against the defendant herein.
(iii) Ex. P-21, which is a receipt from one of the consignors M/s. Anand Textiles of the payment of Rs. 26,000/- through cheque no. 107884 and Rs.
24,000/- through cheque no. 107885 made by the plaintiff herein towards the GRs no. 272399, 272327, 272400-403 all dated 16.12.1991, it becomes clear that no payment was made by the defendants herein to the consignor with respect to the above stated GRs.
(iv) Ex. PW-1/D11, which is the invoice issued by one of the consignors M/s. Santotex Silk Industries in favour of M/s. Jindal Textiles (defendant no. 1 herein) with respect to GR No. 290412 to be delivered through Kartar Carriers i.e. the plaintiff herein.
(v) Ex. PW-1/D2 which is the copy of the cheque of Rs. 16,000/-issued by one of the Bombay associate office of the plaintiff in favour of M/s. Santotex Silk Industries towards the settlement of the complaint case filed by the said consignor for non-receipt of payment of the consigned goods Page 26 of 35
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from the defendant and the breach of settled terms of consignment by the plaintiff herein. This document coupled with Ex. PW-1/D11, gives credence to the plaintiff's story that no payment was made by the defendants herein to the consignors and on account of that, the plaintiff was made to make the payment to the consignors for and on behalf of the consignee i.e. the defendants herein.
From the above said, it could be inferred that the defendants have failed to prove that there is no privity of contract between the plaintiff and the defendants. On the contrary, plaintiff has been successful in proving that plaintiff is entitled to recover the amount which the plaintiff was made to pay to the consignors' on account of non-payment by the defendant/consignee herein.
As to whether the present suit of the plaintiff is bad for the non- joinder of necessary parties, from the above said discussion, it is crystal clear that there is no necessity for the plaintiff to implead the consignors' in the present suit as one of the defendants for the reason that the defendant in the written statement as well as in the evidence has admitted that transactions have taken place between the defendants and the consignors' through the Page 27 of 35
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plaintiff only.
From the above said discussion, the issue no. 2, 3 & 4 as framed are decided in favour of the plaintiff and against the defendants. ISSUE NO. 5 - Whether the plaintiff is entitled to recover the suit amount? OPP
14. The onus to prove this issue was on the plaintiff. Plaintiff has been successful in proving that the defendants have failed to honour their assurance as given to the plaintiff through the request letters Ex. P-4 to P-9 respectively.
Further, the defendants have failed to prove that they have made the entire payment to the consignors with respect to the consigned goods delivered by the plaintiff. The plaintiff has also been successful in discharging the onus by placing on record the documents Ex. PW-1/D1, Ex. P-21, Ex. PW-1/D11 and Ex. PW-1/D2 which shows that plaintiff has compensated the consignors for the non-payment of the consigned goods by the defendants herein.
At this stage, I deem it fit to mention one of the submissions made by ld. counsel for the defendant that the present suit has not been filed by a Page 28 of 35
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competent person. For this, he contends that admittedly the suit of the plaintiff has been filed on 06.03.1995 with the averment that at the time of the institution of the suit, plaintiff was a partnership firm, however from Ex. P-1, which is a Certificate of Incorporation of the plaintiff company, it is shown that the plaintiff company was incorporated under the Companies Act, 1956 on 26.08.1994 i.e. much prior to filing of the present suit. Ld. counsel for the defendant therefore submits that when the plaintiff company was already in existence, the filing of the suit by the plaintiff in the capacity of being a partnership is non-est and merits dismissal on this ground alone. Ld. counsel for the defendant further submits that the resolution in favour of Sh. Harmohinder Singh (PW-1) which is Ex. P-3 was admittedly passed on 11.01.1996. To this, ld. counsel for the plaintiff submits that the above said mistake was corrected by the plaintiff by moving an application under Order 6 Rule 17 CPC at the stage when the defendant was yet to be served in the present suit. He further submits that the said application was allowed vide order dated 08.09.1997 and the title of the plaintiff was allowed to be changed from M/s. Kartar Carriers, a partnership firm to M/s. Kartar Carriers Pvt. Ltd., a private limited company. He further submits that the resolution Ex. P-3 was Page 29 of 35
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filed much prior to the allowing of the plaintiff's application under Order 6 Rule 17 of the Code of Civil Procedure. In view of the above said submissions made by the ld. counsel for the parties, it is no doubt clear that suit of the plaintiff was initially instituted in the wrong name, however, the error was rectified by the plaintiff subsequently by moving the amendment application at the stage when the defendants were yet to enter their appearance in the present suit.
From the above said discussion and in view of the findings on the issue no. 1 whereby the plaintiff's claim with respect to GR Nos. 272327, 272399, 272400 - 403 of M/s. Anand Textiles, Bombay dated 16.12.1991 for the invoice value of Rs. 58,864.40/- was held to be time barred, I hold that the plaintiff is entitled to the recovery with respect to :-
(i) GR Nos. 283366 - 67 dated 07.03.1992 of M/s. Rajkumar Textiles, Bombay - Invoice value of Rs. 24,003.25/-; and
(ii) GR Nos. 290412 dated 18.04.1992 of M/s. Santotex Silk Industries, Bombay - Invoice value of Rs. 14,786.40/-.
The issue no. 5 is decided accordingly.
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ISSUE NO. 6 - Whether the plaintiff is entitled to recover the interest? OPP
15. Plaintiff in the suit amount of Rs. 1,54,218/- is claiming the interest amount of Rs. 61,014/- @ 21% per annum from the date of delivery till 28.02.1995. It is to be seen that this interest amount is claimed by the plaintiff even with respect to the GR Nos. 272327, 272399, 272400-403, all dated 16.12.1991 of M/s. Anand Textiles, Bombay of the invoice value of Rs.
58,864.40/-. In view of the findings on the issue no. 1, wherein it has been held that in so far as the plaintiff's claim for the above stated GRs is concerned, the same is barred by limitation, therefore the plaintiff's claim for interest on the above stated GRs could not be allowed. As to the rate of interest, it is the plaintiff's case that since the rate of interest @ 21% per annum is the prevalent market rate of interest, therefore the plaintiff is entitled to the interest at the said rate over the total invoice amount of Rs. 97,654.05/-. Ld. counsel for the defendant contends that since there is no privity of contract between the parties, the plaintiff is not entitled to the recovery of the suit amount which is inclusive of the interest amount also. As to whether there is Page 31 of 35
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privity of contract between the parties or not, this issue already stands settled in view of the findings on the issue no. 2, 3 & 4. Once the request letters Ex. P-4 to Ex. P-9 are admitted by the defendant as the same is reflected in the cross-examination of PW-1 when a question was put to PW-1 that what is your response to the question to the effect that you have mentioned in your affidavit that the proprietor of the defendant firm gave you a request letter with the assurance that in event of failure to pay the cost of the goods, the plaintiff shall be liable to claim the same from the defendants herein. By putting the said question, the making of the request letters Ex. P-4 to Ex. P-9 is not denied by the defendants herein, what is denied is that no promise was ever made by the defendant no. 2 (in the capacity of being the proprietor of defendant no. 1) to the effect that he will make the payment to the plaintiff once the delivery of the goods is given to him. I have perused the request letters Ex. P-4 to Ex. P-9. There is a clear request from the defendant no. 2 that let first the consigned goods be delivered to his labourers, the builty (the necessary documents of consignment) shall be delivered to the plaintiff, once the same is obtained by the defendant from the concerned bank. In view of the same, it becomes crystal clear that even though the plaintiff was only a Page 32 of 35
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transporter for the delivery of the consignment to the defendants herein from the consignors', the defendants having made a special request by way of Ex. P- 4 to Ex. P-9 have clearly entered into an understanding with the plaintiff and thus, the contention of the ld. counsel for the defendant that there is no privity of contract between the parties, does not hold good. Once the privity of contract is established between the parties and the plaintiff having suffered loss at the hands of the defendant herein, the plaintiff is not only entitled to be compensated for the loss but also is entitled to the interest thereon. However, the plaintiff has not proved anywhere that he is entitled to the interest @ 21% per annum as claimed in the plaint by the plaintiff. Further, the interest amount of Rs. 61,014/- can also not be awarded to the plaintiff for the following reasons :-
(i) As to what was the date of delivery, from where the interest amount is claimed, has nowhere been stated by the plaintiff; and
(ii) The claim of Rs. 58,864.40/- towards the GR Nos. 272327, 272399, 272400-403, all dated 16.12.1991, has been held to be time barred.
In view of the aforesaid, I am of the opinion that plaintiff is entitled to : - (i) Pre-suit interest to be calculated from 18.04.1992 which is the date Page 33 of 35
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with respect to the GR No. 290412 till the filing of the suit; and (ii)Pendente- lite and future interest only with respect to the GR Nos. 283366-67 dated 07.03.1992 of the invoice value of Rs. 24,003.25/- and GR No. 290412 dated 18.04.1992 of the invoice value of Rs. 14,786.40/-. In the fact and circumstances of the case where the plaintiff has suffered loss at the hands of the defendants, I award the pre-suit interest @ 6% per annum from 18.04.1992 till the filing of the present suit. I further award pendente-lite and future interest to the plaintiff @ 18% per annum over and above the amount of Rs.
38,789.65/- (the total invoice value towards the GR Nos. 283366-67 dated 07.03.1992 and GR No. 290412 dated 18.04.1992 respectively).
This issue is decided accordingly.
RELIEF
16. In view of the findings on the issues as framed, the suit of the plaintiff is hereby partly decreed for the recovery of Rs. 38,789.65/- (the total invoice value towards the GR Nos. 283366-67 dated 07.03.1992 and GR No. 290412 dated 18.04.1992 respectively) along with pre-suit interest @ 6% per Page 34 of 35
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annum from 18.04.1992 till the filing of the present suit and pendente-lite and future interest @ 18% per annum over and above the decreetal amount, till its realization. The plaintiff's claim for the recovery towards the invoice value of Rs. 58,864.40/- for GR Nos. 272327, 272399, 272400-403, all dated 16.12.1991, of M/s. Anand Textiles, Bombay is rejected as the same is time barred. Plaintiff's claim for the recovery of the interest amount of Rs. 61,014/-
@ 21% per annum from the date of delivery till 28.02.1995 is also rejected. Plaintiff shall also be entitled to proportionate costs. Decree sheet be drawn accordingly. File be consigned to Record Room.
Announced in open court:
Dated : 15th November, 2007 (SATISH KUMAR ARORA) (Three copies attached) CIVIL JUDGE, DELHI
This judgment contains 35 pages and each page bears my signatures. Page 35 of 35