Delhi District Court
M/S Vintex Creations Pvt. Ltd vs Shri Bhavneet Walia on 21 November, 2011
IN THE COURT OF SHRI J.P.S. MALIK : ADDITIONAL DISTRICT
JUDGE04 : SOUTH DISTRICT : SAKET COURT COMPLEX
NEW DELHI
SUIT NO. 322/2010
IN THE MATTER OF :
M/s VINTEX CREATIONS PVT. LTD.
HAVING ITS REGISTERED OFFICE AT:
102, SOUTH EX. PLAZAII,
MASJID MOTH, NEW DELHI110049
MR. ADITYA GUPTA
THROUGH ITS DIRECTOR ....PLAINTIFF
VERSUS
SHRI BHAVNEET WALIA
SOLE PROPRIETOR,
M/s NEW LINE TRENDS,
HAVING ITS OFFICE AT:
287 E, SPACE NIRVANA APARTMENTS,
SOUTH CITYII,
GURGAON, HARYANA. ....DEFENDANT
Date of Institution of case : 21.10.2010
Date on which judgment : 19.11.2011
has been reserved
Date on which the judgment : 21.11.2011
has been delivered
JUDGMENT
1 Plaintiff company has filed a suit under Order XXXVII CPC for recovery of Rs. 10,04,524/ against the defendant. The suit has been filed through Sh. Aditya Gupta, one of the Director of the plaintiff company. As per the case of the plaintiff company, it is engaged in the business of manufacturing and exports of readymade garments and was approached by the defendant claiming himself as sole proprietor of a "Buying house" for foreign purchasers. The defendant had placed order, vide Purchase Order No. 986 dated 24.02.2010 for supply of readymade garments which Contd....// 2 were supplied by the plaintiff after manufacturing and inspection and approval by STR Labs Pvt. Ltd., in accordance with the purchase order. Final invoice for payment of Rs. 9.16,540/ was issued. The defendant issued a post dated cheque dated 15.05.2010, drawn on Syndicate Bank, Hauz Khas Branch, New Delhi for a sum of Rs. 9,16,540/. The cheque was dishonored by the bank when presented for encashment. On the advice of the defendant, plaintiff on 28.07.2010, the cheque was presented again but it was also dishonored for the second time on account of insufficiency of funds and returned with the Return Memo dated 05.08.2010. Appearance was given on behalf of the defendant in pursuant to summons for the suit under Order XXXVII CPC. The defendant filed an affidavit under Order XXXVII CPC requesting for leave to defend and detailed the facts entitling him for leave to defend.
2 As per the affidavit filed, the defendant has claimed that bills/invoices issued by the plaintiff were not bearing the signature of the defendant, and so, cannot be the basis of a valid contract between the parties and so, a suit under the provisions of order XXXVII CPC is not maintainable. As regard the cheque issued, defendant has claimed that at the time of starting business relations, the plaintiff had obtained blank cheques as security, stating that he will give one month credit to the buyers, keeping a blank cheque for the security for the amount due, which was a common trade practice. The defendant claimed that in month of September 2010, intimation was given by the plaintiff to the defendant about the loss of cheques, which were given blank by the defendant and defendant has claiming that one of the blank cheque given as security, was misused by the plaintiff. Further it is stated that there was no agreement between the plaintiff and the defendant, as regards the payment of interest, which has been claimed @ 24% p.a. Contd....// 3 3 Time was sought repeatedly by the plaintiff to file counter affidavit to the affidavit filed by the defendant, but no counter affidavit was filed and it was stated on behalf of the plaintiff on 16.11.2011, that no counter affidavit was to be filed. Submissions were made by both the parties.
4 Arguments on behalf of the plaintiff were mainly on the point of failure of the defendant to file application for leave to defend in time and it was insisted that the plaintiff is entitled to a decree straight away. On behalf of the plaintiff, reliance was placed on a case decided by Hon'ble Delhi High Court, titled as "Kishan Bharwany Vs. V. P. Aggarwal", 2002 (62) DRJ 731, which was the case where service was effected by way of substituted service by publication as summons for judgments could not be served at the address given. The plaintiff was held entitled to the judgment on failure of the defendant to apply for leave to defend within the prescribed period of 10 days. Affidavit was filed on behalf of the defendant on 23.03.2011. The summons for judgment were directed to be issued to the defendant vide order dated 21.01.2011, and as per the report, dated 26.02.2011, the defendant was stated to have left the place. Vide order dated 09.03.2011, summons for judgment were directed to be issued agian to the defendant in the address given by the defendant, while putting his appearance in the Court. The next date of hearing was 05.04.2011. There is no report, as regards the summons for judgment issued for 05.04.2011, as per order dated 09.03.2011. The report dated 26.02.2011 was considered by the Court and summons for judgment were directed to be issued again to the defendant at the address given, in the application for putting up appearance. Instead of moving a formal application for leave to defend, defendant has filed an affidavit, disclosing the facts which in opinion of the defendant entitled him to defend the suit. So, in the circumstances, it could not be held that the defendant had failed to apply for leave to defend within 10 days from the service of summons Contd....// 4 for judgment. The plaintiff is not entitled to judgment or decree merely because of failure of the defendant to move a formal application for leave to defend.
5 As regards granting of leave to defend to the defendant, mainly the case of the defendant is that invoices issued by the plaintiff were not signed by the defendant, hence no valid contract. Secondly there was no agreement regarding payment of interest between the plaintiff and the defendant, and in case, the suit of the plaintiff is based on dishonored cheque, including the claim on account of interest in the suit filed renders the suit not maintainable under Order XXXVII CPC. The suit filed by the plaintiff is based primarily on the cheque for an amount of Rs. 9,16,540/ dated 15.05.2010 drawn on Syndicate Bank, Hauz Khas Branch, New Delhi, which was issued by the defendant to discharge the existing liability, and there is no substance in the contention being made on behalf of the defendant that blank cheques were issued by the defendant to the plaintiff only as a security to secure the payment to the plaintiff. It is nothing but an attempt on the part of the defendant to delay the proceedings and frustrate the claim of the plaintiff. Plaintiff is entitled to claim interest over and above the amount of the dishonored cheque in a suit under Order XXXVII CPC, and is entitled to claim interest @ 24% p.a. as it was a commercial transaction between the parties. Accordingly, the decree for a sum of Rs. 10,04,524/ is passed in favour of the plaintiff and against the defendant in terms of provisions of Order XXXVII Rule 3 (5) CPC. The plaintiff is also held entitled to pendente lite and future interest @ 24% p.a. Costs of the suit is also allowed to the plaintiff. Decree be drawn accordingly.
File be consigned to Record Room.
Announced in the open Court (J.P.S. MALIK)
On 21.11.2011 ADJ04 : SOUTH DISTRICT
All pages signed NEW DELHI : 21.11.2011