Delhi District Court
Sh Vineet Aggarwal vs M/S Roohani Engineering Works on 10 October, 2023
In the Court of Shri Dinesh Bhatt, District Judge (Commercial
Court)-01, Tis Hazari Courts, West District, Delhi
CS (Comm.) No. 262/2022
CNR No.DLWT01-002977-2022
SH VINEET AGGARWAL
PROP. M/S MITTAL STEEL TRADERS
SHOP NO. 714, SECTOR -59, LOHA MANDI BALLABHGARH,
FARIDABAD, HARYANA-121004.
....... Plaintiff
Versus
1. M/S ROOHANI ENGINEERING WORKS
THROUGH ITS PROP. SACHINAV ARORA
2. SH. SACHINAV ARORA
PROP. M/S ROOHANI ENGINEERING WORKS
Both A-50/6, GROUND FLOOR, MAYAPURI INDUSTRIAL AREA,
DELHI -110064
........Defendant
Date of Institution : 05-04-2022
Date of hearing of arguments : 23-09-2023
Date of decision : 10-10-2023
Counsel for the plaintiff : Sh Abhishke Kumar
Counsel for the Defendant : Sh Navneet Goel
JUDGMENT
1. This is a suit for recovery of Rs.10,62,196/- on account of unpaid CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.1 of 17 value of goods supplied by plaintiff.
2. Plaintiff's case is that it is sole proprietorship business and working under the name and style of M/s Mittal Steel Traders. Defendant was also a sole proprietor in the name and style of M/s Roohani Engineering Works and has placed orders for supply of goods which were supplied vide various invoices. Defendant lastly purchased goods in July, 2019 against 3 invoices and paid Rs.75,000/- on 06.09.2019 but did not clear the outstanding amount of Rs.7,17,700/-. Defendant had also issued cheques to discharge his part liability but the said cheques on presentation were dishonoured with remarks "funds insufficient" and one of the cheque was returned back with remarks "account closed". Plaintiff issued legal notice dated 02.08.2021 but no amount was paid. Plaintiff has claimed the suit amount alongwith interest 18% P.A.
3. Defendant filed written statement stating that suit was without any cause of action, the suit was not maintainable as plaintiff had filed a false suit with a view to pressurize him. Plaintiff had concealed material facts. Defendant had already paid the entire amount for the goods purchased from the plaintiff. Defendant had also made payment of Rs.4 lacs in cash to Sh Ravi Mittal on behalf of plaintiff under his instructions and had admitted the same in the conversation between the parties. Plaintiff was trying to claim benefit on the basis of forged and fabricated documents. Plaintiff CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.2 of 17 as per usual business practice persuaded the defendant to handover security cheques which he handed over but they were misused by the plaintiff. Defendant stated that he had made the entire payment for the goods received by him, he had made further payment of Rs. 4 lacs in cash to Sh Ravi Mittal on instructions of the plaintiff and has also failed to supply material ordered by the defendant.
4. On merits he denied his liability and stated that there was no outstanding due against him. He denied having received any legal notice. He denied that the present suit was a commercial dispute.
5. Plaintiff filed replication denying preliminary objections and reiterated the contents of the plaint. He specifically denied that defendant had made payment of Rs. 4 Lac to Sh Ravi Mittal on his behalf or under his instructions or that he had admitted the same in the conversation between the parties.
6. From the pleadings of the parties, vide order dated 12.10.2022, following issues were framed for consideration:-
1. Whether the plaintiff is entitled to recovery of Rs 7,17,700/- alongwith interest from the defendant as alleged? OPP
2. Whether there is no cause of action in favour of the plaintiff? OPD
3. Whether the suit is not maintainable? OPD
4. Whether plaintiff has concealed material facts? OPD
5. Relief.
CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.3 of 17
7. Plaintiff has examined one witness and defendant also examined one witness and thereafter closed their evidence.
8. PW-1 has reiterated the contents of the plaint and has relied upon the documents Ex.P-1 to Ex.P-6. PW-1 in his cross-examination denied that document Ex. P-6 was not correct document as it was not supported with certificate under section 65 B of Indian Evidence Act. He denied that he was not dealing with the accounts. He admitted that as per Ex.P-6 there was an amount of Rs12,09,992/- outstanding as on 26.03.2019 as mentioned at point Mark A. He did not give any interest to the defendant for the credit amount stating that amount was to be given in advance and they did not dispatch the goods till the whole amount was received. He denied that Ex.P-6 was a running account. They were having office at Delhi and Faridabad and maintaining account at both the places. He had not placed on record the ledger accounts maintaining by them for Delhi office and denied that they had not produced the ledger account of Delhi office as they had filed forged and fabricated documents Ex. P-6. He denied that defendant had made payment which was reflected in their ledger account maintained at Delhi office and deliberately did not file the same before the court. They had shown defendant as debtor for Rs. 7,17,700/- in their balance sheet but stated that they had not filed the said balance sheet on record. He denied that even as per their record they were showing interest of CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.4 of 17 Rs.1,61,500/- upto 19-10-2020. He admitted that he had never given any interest to the defendant for any such credit amount lying with them during entire transactions. They did not have any written agreement with the defendant for any interest to be charged on delayed payment and voluntarily stated that the same was being charged as per usual business practice. He denied that Ex.P-6 was not certified and was not attested as per Law. He denied that plaintiff had never given any interest to the defendant for the credit amounts lying with them and, therefore, they were not entitled for any interest from the defendant. He denied that defendant had paid Rs. 4 lac to Sh Ravi Mittal on his instructions and he had wrongly not credited the said amount. He admitted that he did not go through the contents of CD before filing replication. He denied that before filing of the suit there was communication between the parties where he had admitted that he had instructed the defendant to pay Rs.4 lacs to Ravi Mittal. He denied that he had received the entire outstanding amount or that they had not shown the entire amount paid by the defendant in their accounts. He denied that they were having cheques Ex. P-4 (Colly) as security prior to July, 2019 or that they were not meant to be presented for the loan transaction. He denied that they had supplied inferior quality goods to the defendant and defendant had informed him about the same or that defendant despite the said defect had made payment of the goods only as a goodwill respect.
CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.5 of 17 They were having business transactions with the defendant for the last 10-12 years. He denied that they were not entitled to any interest. He denied that document Ex. P-7 to Ex. P-12 were not correct and false. He could not tell as to where, at what time and in whose presence the defendant handed over three cheques Ex.P- 4 (colly) to him. He denied that he had misused the security cheques. He denied that he had never demanded any payment from the plaintiff as there was no outstanding dues. He denied that legal notice Ex. P-7 was never served to the defendant. He admitted his voice in the recorded conversation in CD. He denied that he admitted amount of Rs 30,000 to 40,000/- only due from the defendant and agreed to waive the interest. He was confronted with the transcript Mark DX-1 from point A-1 to A-2 and stated that as per the same Rs.60,000/- to 70,000/- was being mentioned which was related to the prior transaction in question. He admitted that the said amount of Rs.60,000/- to 70,000/- was part of the suit amount. He stated that since defendant was not ready to pay Rs.60,000/- to 70,000/- and, therefore, he agreed to accept Rs. 30,000/- to 40,000/- with respect to the transaction prior to the transactions in question. He did not remember the period of transaction of Rs.60,000/- to 70,000/-. After seeing the statement he stated that the amount of Rs.60,000/- to 70,000/- was not reflected in the statement of account and stated that it might pertain to the statement of account earlier to the statement of CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.6 of 17 account filed on record. He stated that he did not have any signed balance confirmation of the debtors from the defendant as per the Income Tax Act and usual practice of business. He denied that there was no outstanding amount of Rs. 10,62,196/- and, therefore, he did not have any confirmation of balance from the defendant. He denied that he had filed forged and fabricated and made wrong entries in the statement of account which did not show the cash payment made by the defendant. He denied that the plaintiff supplied inferior quality goods and defendant had telephonically informed the plaintiff about the same. He denied that the transcript shows admission on the part of the plaintiff that on plaintiff's instructions, defendant had made payment of Rs. 4 lac to Ravi Mittal. He denied that Ravi Mittal and defendant had a joint meeting in plaintiff's office between October to December 2019 where plaintiff had admitted the receipt of Rs. 4 Lac from Ravi Mittal. He denied that he and Ravi Mittal were hatching a conspiracy against the defendant to usurp hard earned money of the defendant. He denied that in the transcript Mark DX-1 defendant had mentioned that there was Rs. 14 Lac to be paid at out of which Rs.10 lacs have been received by the plaintiff immediately and remaining Rs.4 lacs were given to Mr. Ravi Mittal and there is no denial of said fact on his part. His further cross-examination was deferred for producing the document relating to Rs.60,000/- to Rs.70,000/- and relating to Ravi Mittal.
CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.7 of 17 PW-1 mentioned that he had not brought any document relating to payment of Rs.60,000/- to Rs.70,000/- as there was no document which reflects the said amount. He stated that he had brought the statement of account Ex. PW-1/DX but the same does not reflect the outstanding amount and that no such amount was payable to the defendant. He also produced statement of account of RN Enterprises which is stated to be firm of Sh Ravi Mittal Ex. PW- 1/DX2. He states that he was not having any dealing with any other firm of Sh. Ravi Mittal except R.M. Enterprises. He had not filed the certificate U/s 65B of Indian Evidence Act alongwith Ex.PW-1/DX2. He denied that document Ex.PW-1/DX2 was forged, fabricated and manipulated and he had failed to adjust the amount of Rs.4 Lakh, which the defendant has paid to Sh. Ravi Mittal on his instructions. The statement of account Ex.PW-1/DX was prepared by him but had not filed any certificate U/s 65B Evidence Act alongwith the same. He denied that documents Ex.PW-1/DX and Ex.P6 were forged and fabricated and there was no outstanding amount due towards the defendant. He denied that he was deposing falsely.
9. DW-1 has reiterated the contents of the written statement and has relied upon the documents Ex.DW-1/1 and Mark A. In cross- examination stated that he did not know whether the legal notice Ex.P-7 was received by him or not. He also did not know whether the legal notice Ex.P-7 was received on his mobile and e-mail or CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.8 of 17 not. He denied that legal notice Ex.P-7 was duly served upon him through speed post, currier, whatsapp and e-mail ID. He was maintaining books of account electronically as well as manually through Charted Accountant. His firm was earlier under tax audit but presently was not under tax audit. He did not remember upto which year his tax audit was conducted. He stated that the document Mark A was prepared through Charted Accountant but it was neither authenticated nor signed by Charted Accountant. He did not know if the account of plaintiff was shown in his books of account or not. He did not have any receiving or acknowledgement regarding the cash entries of Rs.20,000/- as shown in Mark A. He did not know whether any cash book was maintained by C.A. or not. He denied that since he did not pay the outstanding amount as claimed in the suit and therefore, he has deliberately not filed his ITR and audited balance sheet. He used to purchase the material from plaintiff on advance payment. He had made entire payment of bill no.87 and made payment of bill nos.111 and 112 after the purchases. The cheques Ex.P-4 were given to the plaintiff one and a half to two years prior to purchase invoice no.87, 111 and 112. He stated that material purchased vide invoices nos.111 and 112 were of sub-standard quality but had neither returned the goods nor complained the plaintiff. He volunteered that he had telephonically informed about the same. He denied that material sent through those invoices was perfect.
CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.9 of 17 He admitted that Ravi Mittal had purchased goods from the plaintiff for manufacturing of exhaust fans. He did not have any written acknowledgement regarding payment of Rs.4 lacs to Ravi Mittal but volunteered that he had filed telephonic conversation where plaintiff had admitted the same. He denied that plaintiff never asked him to pay Rs.4 lacs to Ravi Mittal. He denied that he had purchased material on invoices nos. 87, 111 and 112 on credit basis as he needed the goods urgently. He admitted that advance payments were some times returned to him through bank. He stated that he had to check the account whether the amount of Rs.2 lacs received by defendant on 09.09.2018 as shown in Mark A was refund of advance given by the plaintiff. He admitted that Ex.P-6 shows payment of Rs.50,000/-, Rs.2 lacs and Rs.60,000/- refunded by the plaintiff but not shown in Mark A. He denied that the transactions shown in mark A was incomplete. He never paid the interest on the credit purchases made by him from the plaintiff. The transcript of CD was prepared by him through an authorized person but it was not signed by the authorized person as he was not aware of the same. He denied that transcript of CD was forged and fabricated. He stated that he paid Rs.4 lacs to Ravi Mittal in a single installment and denied that he did not pay any such amount on plaintiff's instructions. He did not know if payment of more than Rs.20,000/- could not be paid in cash for single transaction as per Income Tax Act and Rules. He denied CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.10 of 17 that he was deposing falsely.
Issue No.1
10. Plaintiff stated that he was supplying goods to the defendant and lastly supplied goods to defendant in July, 2019. Defendant made part payment but did not clear the outstanding amount of Rs. 7,17,700/- against the said invoices. He had issued three cheques for part payment of Rs. 6,23,500/- but the said cheques got dishonoured for reasons "funds insufficient / account closed". He had served legal notice to defendant through speed post, whatsapp as well as through e-mail and filed criminal complaint u/s 138 NI Act which was pending against the defendant in Rohini Courts. Defendant did not deny the transactions in question. Defendant's stand is that he has paid the entire amount and had also paid Rs. 4 Lac to Sh Ravi Mittal on plaintiff's instructions. Plaintiff denied the said fact and stated no such amount was received by him nor paid to Ravi Mittal.
11. Plaintiff has filed the invoice Ex. P-2 (Colly), e-way bills Ex. P-3 and the statement of account Ex. P-6 in support of his claim. He has also filed the photocopy of the three cheques issued by defendant alongwith bank returning memos Ex.P-4 and Ex. P-5 respectively. Defendant has also filed copy of his statement of account Mark A but did not file the certificate under section 65 B of Indian Evidence Act and has also not proved the same in accordance with Law. Defendant has further relied on the CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.11 of 17 recorded conversation between him and the plaintiff Ex. DW-1/1 stating that plaintiff had accepted the payments made by the defendant and there was no due amount left to be paid to the plaintiff. He has also filed the transcript of the said conversation mark DX-1. Plaintiff admitted his voice in the recorded conversation Ex. DW-1/1 but denied having accepted the payments made by the defendant. The transcript Mark DX-1 is neither certified nor attested by the writer. Further, the transcript does not even specify the device, date or place of recording. The conversation is shown to be between Vineet Aggarwal (plaintiff) and Sachinav Arora (defendant) and mentions about some outstanding payment of Rs. 30,000/- to Rs. 40,000/- and PW-1 in cross-examination stated that he was mentioning about outstanding amount of Rs. 60,000/- to Rs. 70,000/- and had agreed for Rs. 30,000/- to Rs. 40,000/- as defendant did not agree for paying Rs. 60,000/- to Rs. 70,000/-. Ld Counsel for the plaintiff had argued that defendant has neither given any detail of the date of the recording of the conversation nor proved the transcript as per Law. Ld Counsel for the defendant argued that plaintiff was deposing falsely before the Court and that he had filed the replication without even going through the contents of Ex. DW- 1/1. He had also failed to produce the statement of account where the amount of Rs. 60,000/- to Rs. 70,000/- was being shown as outstanding towards the defendant. The transcript also mentions CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.12 of 17 about some outstanding amount of Rs. 14 Lacs and Rs. 10 Lacs having received and that defendant despite payment did not ask for the goods. Defendant has tried to state that this recorded conversation of Ex. DW-1/1 was an acknowledgement by the plaintiff in regard to the outstanding amount and the fact that defendant had made payment of Rs. 10 Lac which was admitted and Rs. 4 Lac had been given to Sh Ravi Mittal on his instructions but the conversation does not mention about the period or even the date. It also does not specify the exact transaction being talked about or admitted between the parties.
12. As far as the recording and the transcript Ex. DW-1/1 and Mark DX-1 are concerned they are claimed to be in respect of the suit claim but neither mention the date of recording nor give any details of the device from which it was recorded nor a certificate under section 65 B of Indian Evidence Act nor the transcript certificate being the true translation has been filed on record. Even otherwise the conversation talks about certain amounts being adjusted but in absence of any definite statement as to which specific transaction was being admitted by the plaintiff cannot be taken as proof of defendant's defense and the same is required to be proved and corroborated with other best available evidence.
13. Defendant in regard to payment stated that he had cleared the entire outstanding payment and paid Rs. 10 Lac to the plaintiff and Rs 4 Lac to Ravi Mittal on behalf of plaintiff and in regard to CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.13 of 17 payment of Rs. 10 lacs to the plaintiff defendant has relied on the statement of account Mark A which shows more than eight payments made in cash but defendant failed to produce any receipt of the plaintiff in regard to the same. Defendant also claimed to have paid Rs. 4 Lacs to Ravi Mittal on instructions of plaintiff but even on this issue failed to show any receipt of payment to Ravi Mittal. He has also not shown any written communication with the plaintiff in regard to the said payment. There is also no explanation given by him as to why defendant did not obtain any receipt of the cash payment made either to plaintiff or said Ravi Mittal. He also failed to examine said Ravi Mittal to prove the said fact. On the other hand, plaintiff's statement of account Ex.P-6 and Ex. PW-1/DX do not show even a single cash transaction by the defendant. Further, DW-1 in cross-examination admitted that Ex. P-6 was showing transaction dated 26-03-2019, 22-04-2019 and 25-04-2019 for Rs. 50,000/-, Rs. 2 Lacs and Rs. 60,000/- respectively which were refunded by the plaintiff to the defendant but were not reflected in his statement of account Mark A. This further creates a doubt about the manner in which defendant seems to have been maintaining his statement of account Mark A. Defendant mentioned that he was maintaining accounts and also stated that he was availing services of Chartered Accountant. He mentioned that earlier he was under tax audit but later he was out of the tax audit but did not clarify whether the CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.14 of 17 relevant period was covered under tax audit or not. Defendant neither produced his audited accounts, balance sheet or proved his statement of account Mark A. However, even if Mark A is compared with Plaintiff's statement of account Ex. P-6, the same atleast tallies in respect of plaintiff's invoices Ex. P-2 (Colly). Plaintiff further relied on defendant's three dishonoured cheques Ex.P-4 & Ex. P-5 for an amount of Rs. 2,50,000/-, Rs. 2,73,500/- and Rs. 10 Lacs respectively. Defendant stated that these were security cheques and were not meant to be encashed for any transaction in question. In this regard onus to prove that he had deposited the security cheques with plaintiff was on him but except for making an oral statement, no other corroborating evidence has been produced to this effect. Defendant has also not shown any communication by him with plaintiff in this regard. Plaintiff had also served legal notice Ex. P-7 dated 02-08-2021 to the defendant, the postal receipt, courier receipt alongwith tracking report being Ex. P-8, Ex. P-9 and Mark D and E and notice through e-mail being Ex. P-12. Defendant admitted the said e-mail address to be his correct e-mail and in his cross- examination only stated that he did not know if he had received the said legal notice on his mobile as well as e-mail. In view of this defendant is presumed to have been served with legal notice and despite being served did not reply to the same. Consequently, an adverse inference can also be drawn against the defendant in CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.15 of 17 this regard. Thus, defendant has failed to discharge his onus to prove his defense of having paid the outstanding amount to the plaintiff. Plaintiff has also claimed interest @ 18% PA but admitted that there was no contract between parties to this effect. He also admitted that at times defendant used to make advance payments which remained with him over three months but he never paid any interest on the same. However, in the present facts where defendant has failed to pay the outstanding amount despite notice and pre-litigation mediation is entitled for a reasonable interest which in the present case is taken as @ 6% PA. Accordingly, this issue is decided against the defendant.
Issue No.2, 3 & 414. Defendant stated that there was no cause of action, the suit was not maintainable as there was no dues against defendant and plaintiff has concealed material facts in the form that he had not disclosed the fact that on plaintiff's instructions defendant had paid an amount of Rs. 4 Lac to Sh Ravi Mittal and also failed to properly reflect all the payments made by him in his statement of account. However, in view of the findings of issue no. 1, these issues are decided against the defendant.
Relief.
15. In view of the finding of issue no.1, the present suit is decreed for an amount of Rs. 10,62,196/- alongwith interest @ 6% PA from the date of filing of the suit till realization with cost in favour of CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.16 of 17 the plaintiff and against the defendant.
Decree sheet be drawn accordingly.
File be consigned to record room.
Announced in open (Dinesh Bhatt)
Court on 10-10-2023 District Judge (Commercial Court)-01
West, Tis Hazari Courts, Delhi
CS (COMM.) No. 262/2022 Sh Vineet Aggarwal Vs. M/s Roohani Engineering Works Page No.17 of 17