Bangalore District Court
Head Office In Bengaluru Through ... vs Did Not Adhere To The Terms Of The ... on 28 June, 2021
1
Com.OS.No.309/2020
IN THE COURT OF LXXXII ADDL.CITY CIVIL & SESSIONS
JUDGE,AT BENGALURU (CCH.83)
THIS THE 28th DAY OF JUNE 2021.
PRESENT:
SRI.DEVARAJA BHAT.M.,B.COM,LL.B.,
LXXXII ADDL.CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
Com.OS.No.309/2020
BETWEEN:
M/s BASE Educational
Services Pvt.Ltd., # 27, Buill
Tempe Road, Basavanagudi,
Bengaluru -560 004,
Represented by its
Authorized Representative.
: PLAINTIFF
(Represented by
Smt.Divya Ramesh -
Advocate)
AND
1. Kayaka Foundation PU
College of Science &
Commerce @ Kayaka
Residential PU College of
Science & Commerce,
Kesaratagi Road,
Kalaburagi - 585 101,
Represented by its
2
Com.OS.No.309/2020
Chairman.
2. Kayaka Foundation
Education Trust (Regd),
Kesartagi Road, Kalaburagi
- 585 101.
Also at:
Kotnur-D, Dhariyapur Ring
Road, Kalaburagi - 585
102, represented by its
President/ Managing
Trustee.
: DEFENDANTS
(Defendant No.1 & 2 are
represented by Sri.
S.M.Biradar - Advocate.)
Date of Institution of the 03.11.2020
suit
Nature of the suit (suit on
pronote, suit for Suit for Recovery of money
declaration & Possession,
Suit for injunction etc.)
Date of commencement of
recording of evidence --
Date of First Case - Not held -
Management Hearing
Time taken for disposal from 82 days (In view of SOP dated
the date of Conclusion of 21.5.2021, there is delay in
Arguments pronouncing Judgment)
Date on which judgment 28.06.2021
3
Com.OS.No.309/2020
was pronounced
Total Duration Year/s Month/s Day/s
00 07 25
(DEVARAJA BHAT.M),
LXXXII Addl.City Civil & Sessions Judge,
Bengaluru.
JUDGMENT
This is a suit filed by the Plaintiff to direct the Defendants to jointly and severally pay a sum of Rs.24,72,720/- with 18% per annum from 08.05.2018 till realisation.
2. The contentions of the Plaintiff in brief are as follows:-
That the Plaintiff is a reputed private limited Company in the field of educational services in the State of Karnataka, that the 1st Defendant is an Educational Institution managed and run by the 2nd Defendant Trust, that during the year 2016, the 1st Defendant placed Orders/tied up with the Plaintiff for the '1 st year Medical Excel Online Classroom connect Program' offered by the Plaintiff and the Plaintiff had provided the goods and 4 Com.OS.No.309/2020 services mutually agreed upon and the Defendants made payments in a few installments vide Cheques and NEFT transfers, that during the year 2017 vide letter dated
03.05.2017 once again the 1st Defendant wanted to tie-up with the Plaintiff and requested the Plaintiff to provide their 2 nd year Medical Excel (NEET) Online Classroom Connect Program for a period of one year, that the said program included supply of Text books/study materials to all the students and broadcast of live lectures/classes by reputed teachers in the 'Studio' at the Plaintiff's Head Office in Bengaluru through Internet/Online, that the said program was agreed by the 1st Defendant at the rate of Rs.14,000/- plus tax for each student and the 1 st Defendant submitted a list of 115 students amounting to a total of Rs.18,51,500/-, that though the 1st Defendant had agreed to pay the first installment immediately and the remaining in quarterly installments, the 1st Defendant requested for a few days time to pay the first installment, that the Plaintiff raised an Invoice bearing No.021/17-18 for Rs.18,51,500/- as per the agreed rate payable within 30 days of the date of invoice, that whenever the Plaintiff reminded the 1st Defendant about the amount due, the 1st Defendant requested time and assured payment, that the Plaintiff duly supplied the Text books/study materials to all the students periodically and regularly broad-casted the lectures online, that even after utilizing all the study materials 5 Com.OS.No.309/2020 and broadcast of classes provided by the Plaintiff, the 1 st Defendant did not adhere to the terms of the Agreement, that the 1st Defendant paid only a sum of Rs.3,163/- to the concerned authorities as TDS and an amount of Rs.18,48,337/- remains due and outstanding, that the said amount was not paid in spite of several requests and reminders sent to the 1 st Defendant, that the Plaintiff also visited the Defendant's Institution several times, but the 1 st Defendant did not take any action, that the Plaintiff issued a Legal Notice dated 07.11.2019, calling upon the Defendants to pay the said outstanding dues with interest and also sent 2 nd Legal Notice/Reminder on 04.12.2019, but the Defendants neither sent any reply nor complied with the notice, that the said sum of Rs.18,48,337/- is due from the Defendants from 08.05.2018 and they are liable to pay interest at the rate of 18% from 08.05.2018 and hence, the Plaintiff has filed this suit for the above-mentioned reliefs.
3. The Defendant Nos.1 & 2 though appeared through their Counsel, they did not file the written statement.
4. Since there is no defence by the Defendants, I proceeded to pass Judgment under Order VIII Rule 10 of Civil Procedure Code. I heard the arguments of the Advocate for the Plaintiff.
6Com.OS.No.309/2020 Besides his oral arguments, he has also filed his written arguments on 07.04.2021. At the time of preparing this Judgment, after verifying the records, Ex.P.1 to Ex.P.25 are marked.
5. Based on the above pleadings and arguments of the Advocate for the Plaintiff, the following points arise for my consideration :-
1. Whether the Plaintiff is entitled for the Suit Claim from the Defendants ?
2. What Order ?
6. My findings on the above Points are as under:
1. Point No.1 :- In the Affirmative
2. Point No.2 :- As per the final Order for the following reasons.
REASONS
7. Point No.1 :- Before proceeding to consider the merits of the contentions of the Plaintiff, it would be appropriate to have an overview of law governing exercise of power under Order VIII Rule 10 of the Civil Procedure Code.
7Com.OS.No.309/2020
8. In the decision reported in A.I.R. - 1999 - S.C. - 3381 (Balraj Taneja vs. Sunil Madan ), the Hon'ble Supreme Court of India has held as follows :-
"29. As pointed out earlier, the Court has not to act blindly upon the admission of a fact made by the Defendant in his written statement nor the Court should proceed to pass judgement blindly merely because a written statement has not been filed by the Defendant traversing the facts set out by the plaintiff in the plaint filed in the Court. In a case, specially where a written statement has not been filed by the Defendant, the Court should be a little cautious in proceeding under Order VIII Rule 10 of the Civil Procedure Code. Before passing the judgement against the Defendant it must see to it that even if the facts set out in the plaint are treated to have been admitted, a judgment could possibly be passed in favour of the plaintiff without requiring him to prove any fact mentioned in the plaint. It is a matter of Court's satisfaction and, therefore, only on being satisfied that there is no fact which need be proved on account of deemed admission, the Court can conveniently pass a judgement against the Defendant who has not filed the written statement. But if the plaint itself indicates that there are disputed questions of fact involved in the case regarding which two different versions are set out in the plaint itself, it would not be safe for the Court to pass a judgement without requiring the plaintiff to prove the facts so as to settle the factual 8 Com.OS.No.309/2020 controversy. Such a case would be covered by the expression "the Court, may, in its discretion, require any such fact to be proved" used in sub- rule (2) of Rule 5 of the Order VIII, or the expression "may make such order in relation to the suit as it thinks fit" used in Rule 10 of Order VIII."
9. In the decision reported in A.I.R. - 2000 - Delhi - 60 (Relaxo Rubber Limited vs. M/s. Selection Footwear ), the Hon'ble High Court of Delhi has held as follows :-
"3. Keeping in perspective the fact that at least four opportunities for filing written statement have not been availed of by the defendants I feel this is a fit case for invoking the provisions of Order VIII Rule 10. However, since no defence has come forward, it would be, to my mind, the duty of the Court to consider the correctness of the plaintiffs case. For this reason the plaint as well as documents filed along with it were perused and arguments were heard on behalf of the plaintiffs."
10. In the decision reported in A.I.R. - 2000 - Karnataka - 234 (Syed Ismail vs. Smt. Shamshia Begum), the Hon'ble High Court of Karnataka has held as follows :-
"3. The impugned order does not disclose the nature of pleading placed by the plaintiff and 9 Com.OS.No.309/2020 whether there is prima facie material to grant a decree in his favour. A judgement in favour of the plaintiff is not automatic. The Court has to consider the case of the plaintiff and grant a decree in his favour. The learned trial Judge has not referred to the pleadings of the plaintiff and the documents produced by him to substantiate even a prima facie case for grant of a decree in his favour. Therefore, the judgement and decree in favour of the plaintiff is not automatic on failure of the opposite party to put his defence. The Court can grant a judgement in favour of the party only upon consideration of the case of the plaintiff including appreciation of pleadings and evidence."
11. In the decision reported in A.I.R. - 2007 - Delhi - 164 (Union of India vs. Ram Prakash Juneja ), the Hon'ble Delhi High Court has held as follows :-
"4.....The judgement pronounced under Order VIII Rule 10 of the Civil Procedure Code should indicate that the Court has applied its mind to merits of the case before decreeing the case. The said judgement must satisfy the requirements of Section 2(9) of the Civil Procedure Code and the Court should go into the case and pronounced its judgement upon the facts, so far as they were before it. A mere statement that the suit of the plaintiff is decreed under Order VIII Rule 10 of the Civil Procedure Code cannot be sustained."10
Com.OS.No.309/2020
12. The principles emerging from the precedents are that exercise of power under Order VIII Rule 10 of the Civil Procedure Code for pronouncement of judgment is not mechanical. This is an exercise of judicial discretion. The Court must consider the pleadings and the documents including any admission and should pronounce the judgment if the case does not involve disputed questions of facts. Such exercise must be informed by reason, application of judicial mind and consideration of the pleadings of the parties.
13. According to the contentions of the Plaintiff, Plaintiff is a reputed private limited Company in the field of educational services in the State of Karnataka, that the 1 st Defendant is an Educational Institution managed and run by the 2 nd Defendant Trust, that during the year 2016, the 1 st Defendant placed Orders/tied up with the Plaintiff for the '1 st year Medical Excel Online Classroom connect Program' offered by the Plaintiff and the Plaintiff had provided the goods and services mutually agreed upon and the Defendants made payments in a few installments vide Cheques and NEFT transfers, that during the year 2017 vide letter dated 03.05.2017 once again the 1 st Defendant wanted to tie-up with the Plaintiff and requested the Plaintiff to provide their 2nd year Medical Excel (NEET) Online 11 Com.OS.No.309/2020 Classroom Connect Program for a period of one year, that the said program included supply of Text books/study materials to all the students and broadcast of live lectures/classes by reputed teachers in the 'Studio' at the Plaintiff's Head Office in Bengaluru through Internet/Online, that the said program was agreed by the 1st Defendant at the rate of Rs.14,000/- plus tax for each student and the 1 st Defendant submitted a list of 115 students amounting to a total of Rs.18,51,500/-, that though the 1st Defendant had agreed to pay the first installment immediately and the remaining in quarterly installments, the 1 st Defendant requested for a few days time to pay the first installment, that the Plaintiff raised Ex.P.3/Invoice bearing No.021/17-18 for Rs.18,51,500/- as per the agreed rate payable within 30 days of the date of invoice, that whenever the Plaintiff reminded the 1st Defendant about the amount due, the 1st Defendant requested time and assured payment, that the Plaintiff duly supplied the Text books/study materials to all the students periodically and regularly broad-casted the lectures online, that even after utilizing all the study materials and broadcast of classes provided by the Plaintiff, the 1 st Defendant did not adhere to the terms of the Agreement, that the 1 st Defendant paid only a sum of Rs.3,163/- to the concerned authorities as TDS and an amount of Rs.18,48,337/- remains due and outstanding, that the said amount was not paid in spite 12 Com.OS.No.309/2020 of several requests and reminders sent to the 1 st Defendant, that the Plaintiff also visited the Defendant's Institution several times, but the 1st Defendant did not take any action, that the Plaintiff issued Ex.P.20/Legal Notice dated 07.11.2019, calling upon the Defendants to pay the said outstanding dues with interest and also sent 2nd Legal Notice/Reminder on 04.12.2019 as per Ex.P.23, but the Defendants neither sent any reply nor complied with the notice, that the said sum of Rs.18,48,337/- is due from the Defendants from 08.05.2018 and they are liable to pay interest at the rate of 18% from 08.05.2018. In support of the said contentions, the Plaintiff has also produced Ex.P.2, P.4 to P.19, P.21, P.22, P.24 & P.25 detailed in the Annexure to this Judgment.
14. Among the said documents, Ex.P.5, P.6, P.10, P.11, P.12, P.13 are e-mail correspondence. The Plaintiff has also produced necessary certificate under Section 65-B (1)(4) of Indian Evidence Act. Sections 4 and 6 of the Information Technology Act, 2000 provides for legal recognition of electronic records and their use in Government and its agencies. Section 10-A of the said Act specifically provides for validity of contract through electronic means and accordingly provides that such contract shall not be deemed to be unenforceable solely on the ground that such electronic form or means was used for that purpose.
13Com.OS.No.309/2020 Section 12 of the said Act provides for acknowledgment of receipt including in an automated manner. Section 13 of the said Act provides for time and place of dispatch and receipt of electronic records. Upon careful consideration of all these provisions, it is seen that electronic records have been provided with full legal recognition.
15. Under the provisions of the Information Technology Act, 2000 particularly Section 10-A, an electronic contract is valid and enforceable, which states as follows:-
"Section 10-A: Validity of contracts formed through electronic means:- Where in a contract formation, the communication of proposals, the acceptance of proposals, the revocation of proposals and acceptances, as the case may be, are expressed in electronic form or by means of an electronic record, such contract shall not be deemed to be unenforceable solely on the ground that such electronic form or means was used for that purpose."
16. E-Contracts can be entered into through modes of communication such as e-mail, internet and fax. The only essential requirement to validate an E-Contract is compliance with the necessary pre-requisites provided under the Indian Contract Act, 1872. The Plaintiff has complied with the said requirement in the present case.
14Com.OS.No.309/2020
17. The evidenciary value of e-contracts can be well understood in the light of the Sections 85A, 85B, 88A, 90A and 85C of Indian Evidence Act deals with the presumptions as to electronic records whereas Section 65B relates to the admissibility of electronic record. In the present case, there is no dispute about the admissibility of various e-mails exchanged between the parties.
18. Formation of contracts online via emails has been recognized and given validity to by the Indian courts time and again. In the decision reported in 2010(1) - SCALE - 57 (Trimex International FZE Limited, Dubai vs. Vendata Aluminium Ltd.), the parties thoroughly agreed to the terms of the contract via emails. The Hon'ble Supreme Court upheld the validity of this contract and further held as follows:-
"Once the contract is concluded orally or in writing, the mere fact that a formal contract has to be prepared and initiated by the parties would not affect either the acceptance of the contract so entered into or implementation thereof, even if the formal contract has never been initiated."
19. In the said case, the Hon'ble Supreme Court after going through the various E-mails exchanged between the parties including an E-mail attaching the draft contract, which remained 15 Com.OS.No.309/2020 unsigned, opined as follows:-
"44. From the materials placed, it has to be ascertained whether there exists a valid contract with the arbitration clause. It is relevant to note that on 15- 10-2007 at 4.26 p.m. the petitioner submitted a commercial offer wherein Clause 6 contains the arbitration clause i.e. "this contract is governed by Indian law and arbitration in Mumbai courts". At 5.34 p.m. though the respondents offered their comments, as rightly pointed out by Mr K.K. Venugopal, no comments were made in respect of the "arbitration clause". It is further seen that at 6.04 p.m., the petitioner sent a reply to the comments made by the respondent. Again, on 16-10-2007 at 11.28 a.m., though the respondents suggested certain additional information on the offer note, here again no suggestion was made with regard to the arbitration clause...........".
20. Therefore, the correspondence through email can be considered as a valid binding agreement/contract between the parties. Hence, from the contents of above-mentioned e-mails, the Plaintiff has proved his contentions.
21. Further, before filing this suit, the Plaintiff has initiated a pre-institution-mediation and when the notice was sent by the District Legal Services Authority to the Defendants, they intimated that they are not ready to settle the matter through mediation. Hence, a Non-Starter Report is issued and the same is filed by the 16 Com.OS.No.309/2020 Plaintiff. In this suit also, though the Defendants appeared through their Advocate, they have not filed any written statement. Hence, the Defendants deemed to have admitted the contentions of the Plaintiff. Further, the contentions of the Plaintiff are proved by the above-mentioned documents. Further, the suit of the Plaintiff is also within limitation.
22. The Plaintiff has prayed the interest at the rate of 18% per annum from the date of suit till realization. There is no such contract for the said rate of interest. By taking into consideration the trade practice prevailing as on date, the said rate is reasonable and not exorbitant or excessive. Since the transaction involved is a commercial transaction, the Plaintiff is entitled for the interest at the rate of 18% per annum from the date of suit till realisation. Hence, I answer this Point in "Affirmative".
23. Point No.2 :- Therefore, I proceed to pass the following Order.
ORDER The Suit of the Plaintiff is decreed.
17Com.OS.No.309/2020 The Defendants are hereby directed to pay to the Plaintiff, towards price for goods and services supplied to them by the Plaintiff, a sum of Rs.24,72,720/- (Rupees Twenty Four Lakhs Seventy Two Thousand Seven Hundred and Twenty only) with interest at 18% per annum from the date of suit till realization.
The Defendants are hereby directed to pay cost of this suit to the Plaintiff. The Advocate for the Plaintiff is directed to file Memorandum of Cost before the Office within 5 days from today as required under Rule 99 and 100 of Karnataka Civil Rules of Practice.
Draw up decree accordingly.
The Office is directed to send copy of this judgment to Plaintiff and Defendants to their email ID as required under Order XX Rule 1 of the Civil Procedure Code read with Section 16 of the Commercial Courts Act.
(Dictated to the Judgment Writer, typed by her, corrected and then pronounced by me in open Court on this the 28th day of June, 2021).
(DEVARAJA BHAT.M), LXXXII Addl.City Civil & Sessions Judge, Bengaluru.
18Com.OS.No.309/2020 ANNEXURE LIST OF WITNESSES EXAMINED ON BEHALF OF THE PLAINTIFF NIL LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE PLAINTIFF Ex.P-1 Letter of Authorization Ex.P-2 Brochure of the Educational Services provided by the Plaintiff Ex.P-3 Certified Copy of the Invoice No.021/17-18 dated 08.05.2017 Ex.P-4 True Extract of Ledger Account from 01.04.2016 onwards Ex.P-5 E-mail dated 04.05.2017 Ex.P-6 E-mail dated 10.06.2017 Ex.P-7 A file containing 13 Plaintiff's Record of Coursewrap dispatch information dispatched to 1 Defendant st Ex.P-8 A file containing 9 Luggage Slips issued by New Pooja Travels Ex.P-9 A file containing 4 Consigner's Copies issued by VRL Logistics Limited Ex.P-10 E-mail Ex.P-11 E-mail dated 12.03.2020 sent by VRL Logistics enclosing the Delivery Receipts for Goods/Study Materials from Plaintiff delivered to 1st Defendant along with Attachments.
Ex.P-12 E-mail dated 13.02.2020 from Edugyaan, Online Broadcaster for Online Classes of Plaintiff enclosing usage report of Online broadcasting of classes by 1 st Defendant 19 Com.OS.No.309/2020 along with Attachment of four pages.
Ex.P-13 E-mail dated 28.12.2017 Ex.P-14 Form No.26 AS of the Plaintiff in the
Income Tax Website of F.Y. - 2017-18 A.Y. 2018-19 showing the amount deposited by the 1st Defendant as TDS.
Ex.P-15 Whatsapp messages/screen shots sent by Plaintiff to 1st Defendant with respect to dues owed by 1st Defendant.
Ex.P-16 Office Copy of the Letter dated
23.03.2019 sent by Plaintiff to 1st
Defendant
Ex.P-17 Postal acknowledgement
Ex.P-18 Office Copy of the Letter dated
20.07.2019
Ex.P-19 Postal acknowledgement
Ex.P-20 Office Copy of the Legal Notice dated
07.11.2019
Ex.P-21 Postal Receipt dated 08.11.2019
Ex.P-22 Postal acknowledgement
Ex.P-23 Office Copy of the Legal Notice dated
04.12.2019
Ex.P-24 Postal Receipt
Ex.P-25 Office Copy of the Letter dated
07.12.2019
(In respect of the above-mentioned Computer Generated Copies of Electronic Documents, Certificate as required under Section 65B(1)(iv) of the Indian Evidence Act is filed.) 20 Com.OS.No.309/2020 LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENDANT NIL LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE DEFENDANT NIL (DEVARAJA BHAT.M), LXXXII Addl.City Civil & Sessions Judge, Bengaluru.
21 Com.OS.No.309/2020 Case is called out in the afternoon Session. In view of the present SOP dated 25.06.21, the Judgment is pronounced in Open Court.
The operative portion of the said Judgment is as follows :-
JUDGMENT The Suit of the Plaintiff is decreed.
The Defendants are
hereby directed to pay to the
Plaintiff, towards price for
goods and services supplied
to them by the Plaintiff, a sum
of Rs.24,72,720/- (Rupees
Twenty Four Lakhs Seventy
Two Thousand Seven Hundred
and Twenty only) with
interest at 18% per annum
from the date of suit till
realization.
The Defendants are
hereby directed to pay cost of
this suit to the Plaintiff. The
Advocate for the Plaintiff is
directed to file Memorandum
of Cost before the Office
within 5 days from today as
required under Rule 99 and
100 of Karnataka Civil Rules
of Practice.
Draw up decree
accordingly.
22
Com.OS.No.309/2020
The Office is directed to
send copy of this judgment to
Plaintiff and Defendants to
their email ID as required
under Order XX Rule 1 of the
Civil Procedure Code read
with Section 16 of the
Commercial Courts Act.
(vide my separate detailed
Judgment dated 28.06.2021).
(Typed to my dictation).
LXXXII ACCJ, B'LURU.