Delhi District Court
M/S Servotech Power Systems Limited vs Amit Sabharwal Prop. Of Statesman India on 26 March, 2025
In the Court of Shri Ashutosh Kumar, District Judge (Commercial
Court)-01, Tis Hazari Courts, West District, Delhi
CS (COMM.) No. 896/2022
CNR No.DLWT010106142022
In the matter of :
M/s Servotech Power Systems Limited
Through Its Authorised Representative
Ms. Priya Pandey
At 806,8th Crown Heights, Hotel Crown Plaza,
Sector 10, Rohini, New Delhi-110088
............Plaintiff
Vs.
Sh. Amit Sabharwal,
Proprietor Of Statesman India
Ground Floor G-1/99, Phase II, Mayapuri,
West Delhi, Delhi 110 064
Also at:-
Kh No. 37/6, Mundka Udyog Nagar
Behind Metro Yard, Mundka
New Delhi 110 041
Also at:-
A-2/502, Parsvnath Exotica,
Sector 53, Chakarpur (74), Gurgaon
Haryana - 122002
..........Defendant
Date of Institution : 03-11-2022
Date of hearing of arguments : 20-03-2025
Date of decision : 26-03-2025
Ld. Counsel for plaintiff -Sh Kanwar Aditya Singh
Ld Counsel for Defendant - Sh Parth Chaturvedi
CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.1 of 18
JUDGMENT
1. The plaintiff company M/s Servotech Power Systems Limited, which is a Public Limited Company, having its office at 806, 8th Crown Heights, Hotel Crown Plaza, Sector 10, Rohini, New Delhi-110088, has filed the present suit for recovery of Rs. 3,62,000/- alongwith pendente lite and future interest @ 18% per annum, through its authorized representative Priay Pandey, who is claimed to be competent and well conversant with the fact and circumstances of the present case. It is claimed by the plaintiff that it is an NSE-listed company and the market leader in India for LED lights and solar products, has built a strong brand and reputation in the market through the tireless efforts of its directors and other officers.
2. It is further claimed by the plaintiff that the defendant approached the plaintiff, represented himself to be market leader in UPVC Doors & Windows and persuaded the plaintiff to give him the order with the assurance to provide quality goods and services to the plaintiff company, whereupon the plaintiff company agreed to take services and materials from the defendant and asked the defendant to share quotations, qua which defendant provided quotation for an amount of Rs. 6,00,000/- for the entire supply of UPVC doors and windows according to the specification of plaintiff company. It is further claimed that for the said purpose CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.2 of 18 the defendant demanded advance payment of Rs. 2,00,000/- and promised to deliver the material according to the specification and colour within 20 days, which amount of Rs. 2,00,000/- was transferred to the defendant i.e. Rs. 50,000/- on 12-04-2018 via NEFT and Rs. 1,50,000/- on 24-04-2018 through bank transfer. However, despite transferring the aforesaid advance payment and waiting for considerable amount of time, defendant did not provide the materials and complete the work. It is further the claim of the plaintiff that multiple phone calls were made and reminders were sent to the defendant requesting him to provide the materials and do the work within this timeframe. It is further averred that the Managing Director of the plaintiff company also made several personal requests and reminders regarding the supply of materials and completion of the work but the defendant with an intention to cheat and commit fraud, ignored all and also stopped taking calls from the plaintiff's representatives, and began ignoring the phone calls of Plaintiff company's Managing Director. It is further claimed that plaintiff also issued legal notice dated 13.06.2022 vide postal receipt dated 16.06.2022 and email dated 16.06.2022, but despite receiving the same, the defendant failed to comply with it.
3. Plaintiff has claimed that defendant is liable to pay an amount of Rs. 2,00,000/- alongwith interest of an amount of Rs. 1,62,000/- @ 18% per annum w.e.f. 24-04-2018 to 24-10-2022 and CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.3 of 18 pendetelite & future interest at the same rate till realization alongwith costs of the suit.
4. Per contra, claim of the defendant in his preliminary submission of the written statement is that the suit is liable to be dismissed, inter alia, on the grounds that the suit of the plaintiff is based on false and fabricated facts and documents, allegations levelled against the defendant are false and not tenable in the eyes of law, the present suit is filed by misleading, twisting and misrepresenting actual and true facts and the plaintiff has not come before this court with clean hands and that there is no admitted liability on the part of the defendant. While admitting that the parties had entered into an agreement and advance payment of Rs. 2,00,000/- was received by the defendant, defendant has claimed that the plaintiff had received the materials according to the specification and colour as per the contract dated 20-07-2018 and the same was confirmed by plaintiff's authorized person namely Deepak at their office at 806, 8th Floor Crown Heights, Near Crowne Plaza Hotel, Rohini near Rithala, which was communicated to the defendant through whatsapp message sent by Rashmi Upadhya (employee of the plaintiff). Defendant has further claimed that the plaintiff had not paid the contractually due amount as per the agreement amounting to Rs. 4,00,000/- with interest @ 18% from 20-07-2018 to 24-10-2022 alongwith pendete lite and future interest, which is pending outstanding CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.4 of 18 against the plaintiff.
5. Defendant has also claimed that the plaintiff had given dealership authorization to the defendant on 13-04-2020 during covid -19 period, which clearly states that there was no default on defendant's part and had there been a default, dealership in the name of of defendant would not have been issued.
6. In his reply on merits, defendant while admitting commercial transactions between the parties during regular course of business dealings, has claimed that plaintiff defaulted the balance payment for the goods which were already delivered by the defendant amounting to Rs. 4,00,000/- alongwith interest @ 18%. Defendant has claimed that defendant supplied the required materials before the stipulated time and it was duly acknowledged by the plaintiff vide whatsapp chat of plaintiff's employee namely Raman Bhatia. Defendant has also denied having received any legal notice and rather claimed that he tried reaching out the office of the plaintiff for the balance amount on multiple dates and repayment was promised by the plaintiff but plaintiff did not make the payment. Defendant has denied his liability of payment of outstanding principal amount alongwith interest and prayed that the suit of the plaintiff be dismissed, which was filed without any cause of action.
7. Plaintiff filed replication to the written statement filed by the defendant, reiterating the contents of the plaint and denying the CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.5 of 18 averments made in the written statement.
8. From the pleadings of the parties, the following issues were framed vide order dated 02-03-2023:
1. Whether the plaintiff is entitled to recovery of Rs 3,62,000/- along with interest from the defendant as alleged? OPP
2. Whether the suit is not maintainable? OPD
3. Whether there is no cause of action in favour of plaintiff? OPD
4. Whether plaintiff has concealed material facts? OPD
5. Relief
9. Initially, the suit was filed by A.R. Priya Pandey of the plaintiff but later an application by the plaintiff for substitution of new authorized representative in place of earlier AR, who was in family way, was filed, which was allowed vide order dated 18-05- 2023 and Mrityunjay Jha, Manager HR of the plaintiff, was substituted as the new AR, who was examined as plaintiff's sole witness as PW-1. PE was closed on 10-08-2023. On the other hand, defendant examined himself as DW-1 and DE was closed on his behalf vide statement made by his counsel on 01-08-2024.
10. PW-1 Mrityunjay Jha, Manager HR of the plaintiff M/s. Servotech Power Systems Limited, tendered his affidavit of evidence Ex. PW-1/A on 18-05-2023 and relied upon the following documents:-
(1) Board resolution dated 20-05-2022 - Ex. PW-1/1 (2) Certificate of Incorporation of Plaintiff Company -Ex. PW-1/2 (3) Email dated 11.04.2018 - Ex. PW-1/3 CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.6 of 18 (4) Statement of Accounts - Ex. PW-1/4 (5) Bank Statement of Plaintiff Company w.e.f. 01.04.2018 to 30.04.2018 - Ex. PW-1/5 (6) GST Detail of Defendant - Ex. PW-1/6 (7) Legal Notice dated 13.06.2022 with postal receipt and email - Ex. PW-1/7 (Colly.) (8) Declaration by way of affidavit in Compliance of Order XI Rule 6(3) of CPC - Ex. PW-1/8 (9) Board Resolution dated 13-04-2023 Ex. PW-1/9 PW-1 was cross-examined by the counsel for the defendant.
11. Defendant Amit Sabharwal tendered his evidence by way of affidavit vide Ex. DW1/A and relied upon dealership letter issued by the plaintiff in favour of defendant as Mark A.
12. I have heard the final arguments addressed by ld. Counsels for both the parties, perused their respective written submissions filed on record and have also perused the judicial file.
13. During the course of final arguments, Ld Counsel for the plaintiff relied upon the following judgments:
(1) Thangam And Anr. vs Navamani Ammal (2024) 3 S.C.R. 146 in Civil Appeal No. 8935/2011 (Decided on 4 March, 2024) (2) State of M.P. v. Chintaman Sadashiva Vaishampayan AIR 1961 SC 1623
14. Perusal of record reveals that the pre-litigation mediation held in the matter, was a non-starter as the defendant did not appear before DLSA, West District and finally the non-starter report dated 15-09-2022 was issued. However, plaintiff has not formally CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.7 of 18 proved the same in his evidence but judicial note of the same is taken as the same is part of record.
15. As regards limitation, during course of arguments, Ld. Counsel for the plaintiff has argued that total amount of Rs. 2,00,000/- was transferred to the defendant by the plaintiff i.e. Rs. 50,000/- via NEFT on 12-04-2018 and Rs. 1,50,000/- through bank transfer on 24-04-2018, which is duly reflected in ledger account filed by the plaintiff Ex. PW-1/4, which is duly supported with affidavit in Compliance of Order XI Rule 6(3) of CPC - Ex. PW-1/8. Ld Counsel for the plaintiff has claimed that period of 15.03.2020 to 28.02.2022 has to be excluded for the purpose of counting the period of limitation in terms of judgment of Hon'ble Supreme Court in Miscellaneous Application no. 21 of 2022 in Miscellaneous Application no. 665 of 2021 in SUO MOTU Writ Petition © No. 3 of 2020 with Miscellaneous Application No. 29 of 2022, due to Covid 19 pandemic. It is also claimed that the plaintiff had intiated pre-institution mediation on 14-07-2022 against the defendant but the matter could not be settled and non- starter dated 15-09-2022 was accordingly issued and the time spent in said mediation proceedings, is also liable to be excluded as per section 12 A of the Commercial Courts Act, 2015 while calculating the limitation period. Ld Counsel for the plaintiff has accordingly argued that suit was filed within limitation. I find force in the said submissions of the Ld Counsel for the plaintiff CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.8 of 18 and accordingly hold that the present suit is filed within limitation.
16. The defendant has not disputed the territorial jurisdiction of this court to try the present matter. Even otherwise the defendant has not disputed two of its addresses at Mayapuri and Mundka, Delhi, situated within the territorial jurisdiction of this court. Hence in view of the order of Hon'ble High Court of Delhi in the case of Dentsply India Pvt. Ltd. Vs Excel International & Ors., CS (OS) No. 410/1999, dated 10.07.2012, territoral jurisdiction of this court is made out.
17. My issue-wise findings are as under:
ISSUE No. 11. Whether the plaintiff is entitled to recovery of Rs 3,20,125/- along with interest from the defendant alleged? OPP
18. The onus to prove this issue was on the plaintiff.
19. From the written statement of the defendant, it appears that it is the claim of the defendant that oral contract in question was entered into between the parties on 20-07-2018 when the defendant had supplied the said materials as per specification and colour to the plaintiff. The defendant has admitted that the contractual amount was Rs. 6,00,000/- and Rs. 2,00,000/- advance in aforesaid manner (as per claim of plaintiff) was paid to him. Claim of the defendant is that he had performed his part of the contract but the plaintiff has not paid the balance contractual amount of Rs. 4,00,000/-, which defendant is entitled for.
CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.9 of 18
20. However, PW-1 has proved e-mail dated 11-04-2018 Ex. PW-1/3 sent by the plaintiff to the defendant, vide which a contract was purportedly entered between the parties as the same is supported with affidavit under order XI Rule 6(3) of CPC, as applicable to Commercial Courts Act, 2015. PW-1 has deposed that the said certificate be also treated as u/s 65B of Indian Evidence Act, 1872. The contents of the said e-mail are reproduced as under:-
"We have shared Finesta quotation with you. Accordingly, as discussed and as per quotation, all glaass will be toughened with reflective glass, laminated & DGU for all Doors and windows. All fittings with be ROTO, German Brand. If there is any change in size (Increased or decreased), difference will be adjustable.
Cost proposal given by you is Rs. 6,00,000/- (Rs. Six Lacs only). Against the same need to discuss further on Monday between Mr Amit Sabarwal & Mr Raman Bhatia.
To start the job, we are transferring Rs. 50000/- (Rs fifty thousand only) as an advance payment.
Please acknowledge."
21. Per contra, defendant in his affidavit of admission / denial has denied the said e-mail Ex. PW-1/3. However, defendant has not denied that his e-mail ID mentioned therein is incorrect. Except for baldly denying the said document, he has not proved on record any cogent technical evidence, which may negate the delivery of said email. Once the said email is proved to have been sent by the plaintiff to the defendant, no reply thereto raising any objection and receiving the part payment mentioned in the e-mail, amounts CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.10 of 18 to deemed admission of the terms thereof by the defendant. Such bald denial of the said document by the defendant without any reason, is not in consonence with order XI Rule 4 (3) of the Commercial Courts Act, 2015 and hence adverse presumption has to be drawn against the defendant.
22. Also, defendant in para 9 of his affidavit of evidence Ex. DW-1/A, has deposed as under:
"That the deponent states that out of the total understanding for the amount of Rs. 6,00,000/- for the entire work, the plaintiff has paid an amount of Rs. 50,000/- on 12.04.2018 and 1,50,000/- on 24.04.2018 and that the remaining amount has not been paid till date."
23. Hence, from the same also it is clear that the total amount qua the entire work assigned to the defendant by the plaintiff, was Rs. 6,00,000/-, which is same amount mentioned in the aforesaid email Ex. PW-1/3. From Ex. PW-1/3, it can be inferred that the plaintiff had given an initial amount of Rs. 50,000/- to the defendant for the purpose of starting of the job.
24. Further, PW-1 has also proved ledger account Ex. PW-1/4, qua the defendant mentioning the total payment of Rs. 2,00,000/- i.e. Rs. 50,000/- via NEFT on 12-04-2018 and Rs. 1,50,000/- through bank transfer on 24-04-2018. Also the bank statement of the plaintiff Ex. PW-1/5 reflects the said entries. Furthermore, the said fact qua receipt of payment of Rs. 2,00,000/- by the above CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.11 of 18 modes, have been also admitted by the defendant in para 11 of his written statement and para 9 of affidavit of evidence of DW-1 Ex. DW-1/A.
25. Accordingly, in view of the aforesaid discussion, the existence of the contract in terms of email Ex. PW-1/3 and part payment in terms of the same stands duly proved as the same adheres to all the necessary requirements as per Indian Contract Act, 1872 & Information Technology Act, 2002. Relevant section 10A of the Information Technology Act, 2002 is reproduced as under:-
"10A. 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 records, such contract shall not be deemed to be unenforceable solely on the ground that such electronic form or means was used for that purpose."
26. Defendant has claimed that plaintiff had received all the material for the work on 20-07-2018 and the same was confirmed by the plaintiff's employee namely Deepak, which was communicated over whatsapp and therefore, the plaintiff is liable to pay the defendant balance amount of Rs. 4 lakh alongwith interest @ 18% from 20-07-2018 to 24-10-2022 alongwith pendente and future interest.
27. To prove the said claim, Ld Counsel for the defendant has drawn my attention to cross-examintion of PW-1 dated 05-06-2023, CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.12 of 18 wherein he had admitted the chats filed by the defendant, between defendant and plaintiff's representative Ex. PW-1/DX. On perusal of the said chats, it is revealed that plaintiff only confirmed having received 11 frames and nowhere it is mentioned that plaintiff had received all the material as mentioned in e-mail dated 11-04-2018 Ex PW-1/3, which is contrary to aforesaid claim of the defendant. Admittedly, no counter claim qua the aforesaid claim of the defendant, has been filed by the defendant. Hence, it is clear that only 11 frames were delivered to the plaintiff by the defendant. However, it is clear that work in terms of the contract i.e. e-mail Ex. PW-1/3 was not completed by the defendant.
28. Though, PW-1 has admitted having received 11 frames but value thereof or invoice has not been proved by the defendant and also no question was asked by the defendant to PW-1 in the said regard. Accordingly, value of the total material supplied i.e. 11 frames cannot be ascertained in the absence of any corroborative document filed by the defendant. Hence, no benefit can accrue to the defendant in that regard.
29. Yet another objection raised by Ld counsel for the defendant that PW-1 Mrityunjay Jha was not an employee of the plaintiff company and was also not properly authorized to depose before the Court. To counter the said claim of the defendant, PW-1 has proved his authority letter dated 13-04-2023 Ex. PW-1/9, issued in his favour by the plaintiff company. Also, in cross-examination of CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.13 of 18 PW-1, Ld Counsel for the defendant had not asked PW-1 to produce the original minutes of meeting of Board of Directors of the plaintiff company authorizing PW-1 to appear and depose on behalf of plaintiff company. Even PW-1 was not asked by Ld counsel for the defendant to produce any document qua his employment with the plaintiff. Accordingly, the said bald suggestion of denial to PW-1 by Ld Counsel for the defendant, does not hold water. Therefore it stands proved that PW-1 was duly authorized by the plaintiff.
30. Ld Counsel for the defendant has claimed that there was no bifurcation of work and time mentioned in the agreement between the parties qua the work assigned to him. There is no doubt that there was no specific bifurcation of work and time frame mentioned in the aforesaid e-mail dated 11-04-2018 Ex. PW-1/3. However, the defendant cannot claim that in the light of the same, the defendant had no liability to complete the work at any point of time as per his own whims and fancies. The said contract should have been concluded within a reasonable time frame. Even otherwise the said plea of the defendant is inherently contradictory as the defendant is simultaneously also claiming that he had performed his part of the contract. As already held the said contract was not completed by the defendant. Hence no benefit can accrue to the defendant and hence defendant cannot get any benefit of the said argument.
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31. Although the defendant has denied the legal notice of demand dated 13.06.2022 sent vide speed post receipt dated 16.06.2022 Ex. PW-1/7 (colly.) and the same notice sent through email on 16.06.2022 as claimed by the plaintiff but the defendant has not claimed that his given address in the said legal notice of demand, is not correct, or that his email ID as mentioned in the said email dated 16-06-2022, is not his correct ID. Since PW-1 has proved that the said legal notice of demand was sent to the defendant at his last known correct address through speed post, qua which no report was received, therefore it has to be presumed as per section 27 of the General Clauses Act, 1897 and section 114 of Indian Evidence Act, 1872 that the said legal notice of demand was deemed to be served upon the defendant. Since inspite of deemed service of legal notice of demand, the defendant admittedly did not give any reply thereto, therefore adverse presumption has to be drawn against the defendant. However, the plaintiff has not proved the requisite certificate under order XI Rule 6(3) of CPC, as applicable to Commercial Courts Act, 2015 and u/s 65B of Indian Evidence Act, 1872, qua the said email and hence the said e-mail does not stand proved.
32. On the basis of pleadings and documents filed on record, the plaintiff has been able to prove its case that the plaintiff had paid total sum of Rs. 2,00,000/- as part payment for completion of work to the defendant in terms of contract e-mail Ex. PW-1/3, but CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.15 of 18 defendant did not do any work qua the same. Admittedly the defendant has neither proved any material purchased qua completion of work as per contract nor has proved any corroborative material to show that any such work was actually done by him. Hence, the defendant is liable to return/repay the amount of Rs. 2,00,000/- on account of non-performance of the work assigned to him vide contract arrived at between the parties on the basis of e-mail dated 11-04-2018 Ex. PW-1/3.
33. The next question is as to the rate of interest. The plaintiff has also claimed pendentelite and future interest @ 18% per annum on the suit amount.
34. However, in the case of Cimmco Limited Versus Pramod Krishna Agrawal 2019 SCC OnLine Del 7289, it was held as follows;
"3..........Hon'ble Supreme Court has now mandated that lower rates of interest be granted and therefore the pre-suit and also the pendente lite and future interest is liable to be reduced by this Court. Reliance is placed upon the judgments in the cases of Rajendra Construction Co. v. Maharashtra Housing & Area Development Authority, (2005) 6 SCC 678, McDermott International Inc. v. Burn Standard Co. Ltd., (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 & State of Rajasthan v. Ferro Concrete Construction Pvt. Ltd. (2009) 3 Arb. LR 140 (SC)."
35. In the given facts and circumstances and keeping in view the CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.16 of 18 aforesaid judgement and prevalent rate of interest, the plaintiff is granted simple interest @ 9% per annum on the outstanding amount.
36. In view of the same, issue no. 1 is decided in favour of the plaintiff and against the defendant.
ISSUE NO. 2"2. Whether the suit is not maintainable? OPD"
37. The onus to prove this issue was on the defendant.
38. However, except for baldly claiming so, the defendant has not brought any corroborative evidence in support thereof. Accordingly, this issue is decided against the defendant and in favour of the plaintiff.
ISSUE NO. 3"3. Whether there is no cause of action in favour of plaintiff? OPD"
39. The onus to prove this issue was on the defendant.
Defendant has baldly claimed that there is no cause of action. However, defendant has failed to prove any fact on the basis of which it can be inferred that there was no cause of action in favour of the plaintiff and against the defendant. Also, defendant has not lead any specific evidence in this regard. In view of the same and in view of my findings to issue no. 1, this issue is decided against the defendant and in favour of the plaintiff.
CS (COMM.) No. 896/2022 M/s. Servotech Power Systems Limited Vs Amit Sabharwal Page No.17 of 18 ISSUE NO. 4
4.Whether plaintiff has concealed material facts? OPD
40. The onus to prove this issue was on the defendant.
41. Defendant has baldly claimed that the plaintiff has concealed material fact without placing any material fact in that regard. Hence, in view of my findings to issue no. 1, the said contention of the defendant does not hold water and accordingly this issue is also decided against the defendant and in favour of the plaintiff. RELIEF
42. In view of my findings to above issues, the suit is decreed in favour of the plaintiff and against the defendant, for an amount of Rs. 2,00,000/ alongwith interest @ 9% per annum from 13-06- 2022 (date of legal notice) till realization alongwith costs of the suit.
Decree sheet be drawn accordingly.
File be consigned to record room. Digitally signed
by ASHUTOSH
ASHUTOSH KUMAR
KUMAR Date:
2025.03.26
16:43:03 +0530
(Announced in the open (Ashutosh Kumar)
Court) District Judge (Commercial Court)-1
West, Tis Hazari Courts, Delhi / 26-03-2025
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