Delhi District Court
Skymates (India) Pvt. Ltd vs M/S Hindustan Exports on 24 January, 2019
IN THE COURT OF SH. SANJEEV KUMARI
ADDITIONAL DISTRICT JUDGE12, CENTRAL,
TIS HAZARI COURTS, DELHI
CSDJ No.613559/16 &
CSDJ No.619342/16 (Counter Claim)
Skymates (India) Pvt. Ltd.
A company registered under the
Companies Act,1956 having its
registered office at
A388, Defence Colony,
New Delhi110024
Through Mr. Ravi Kumar Agarwal ....Plaintiff/ non counter claimant
Versus
1. M/s Hindustan Exports,
a Partnership firm having its office at
4046, Gali Khan Khana,
Jama Masjid,
Delhi110006,
Through its Partners
2. Mr. Wali Alam,
Parner
M/s Hindustan Exports,
4046, Gali Khan Khana,
Jama Masjid,
Delhi110006,
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 1 of 55
Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
3. Mr. Ishtiaque Ahmed,
Parner
M/s Hindustan Exports,
4046, Gali Khan Khana,
Jama Masjid,
Delhi110006 ....Defendants/ counterclaimants
Date of institution : 12.07.2007 (CS613559/16)
: 29.08.2007 (CS619342/16)
Date of reserving order : 10.01.2019
Date of decision : 24.01.2019
SUIT FOR RECOVERY OF RS.19,49,748/
&
COUNTER CLAIM OF RS.19,36,982/ AND
RENDITION OF ACCOUNTS
JUDGMENT
1. Vide this judgment, I shall decide the suit for recovery of Rs.19,49,748/ filed by the plaintiff against the defendants and counter claim filed by the defendants for recovery of Rs. 19,36,982/ and rendition of accounts against the plaintiff company.
2. Brief facts as stated in the plaint are that plaintiff is a company registered under the Companies Act and defendant no.1 is a partnership firm and CS No.613559/16 & CS 619342/16 (Counter Claim) Page 2 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. defendant no.2 and 3 are its partners. The plaintiff is an IATA agent and a cargo forwarder. The defendant no.1 in the year 198384 approached the plaintiff for availing the services of the plaintiff for exporting its goods to destination outside India and after satisfied with the services rendered by the plaintiff, the defendant regularly started availing the services of the plaintiff. Since defendant no.1 was regularly availing the services of the plaintiff hence instead of paying the freight of the shipment, the defendant no.1 started making on account payments and availing the credit facility. On 12th June, 2006, total outstanding against the defendant was Rs.18,42,749/. The defendant made payment of Rs.10 lakhs on 14th July, 2006 and a further sum of Rs.8 lakhs was paid on 18th September 2006. From 13th June, 2006 to 07th October, 2006, the defendant no.1 through the plaintiff sent 28 shipments on credit facility, details of which is given as under: S.No. Airway Bill No. & Date Invoice No. & Date Amount/ Freight
1. 60701627522 00285 103278.00 13/06/2006 13/06/2006
2. 60701627533 00319 123115.00 20/06/2006 20/06/2006
3. 60701623296 00318 105063.00 24/06/2006 24/06/2006
4. 60701627710 00328 113063.00 CS No.613559/16 & CS 619342/16 (Counter Claim) Page 3 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
27/06/2006 27/06/2006
5. 60701623300 00397 109420.00
01/07/2006 01/07/2006
6. 60701627721 00399 117098.00
04/07/2006 04/07/2006
7. 60701687523 00408 118965.00
08/07/2007 08/07/2006
8. 60701687534 00409 114193.00
11/07/2006 11/07/2006
9. 60701685784 00451 101328.00
15/07/2006 15/07/2006
10. 60701687545 00453 62318.00
18/07/2006 18/07/2006
11. 60701685740 00492 117513.00
25/07/2006 25/07/2006
12. 60754150596 00493 115115.00
29/07/2007 29/07/2007
13. 60701685762 00526 60865.00
01/08/2006 01/08/2006
14. 60701435416 00527 118550.00
08/08/2006 08/08/2006
15. 60701637882 00539 60243.00
12/08/2006 12/08/2006
16. 07254150600 00538 101256.00
16/08/2006 16/08/2006
17. 07256634163 00557 101475.00
19/08/2006 19/08/2006
18. 60701743722 00558 106930.00
22/08/2006 22/08/2006
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 4 of 55
Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
19. 07256634174 00584 45816.00 01/09/2006 01/09/2006
20. 07256634185 00610 48675.00 09/09/2006 09/09/2006
21. 60701748445 00622 55263.00 10/06/2006 10/06/2006
22. 60701748456 00623 60658.00 16/09/2006 16/09/2006
23. 60701748460 00636 60035.00 19/09/2006 19/09/2006
24. 60701748471 00644 62110.00 23/09/2006 23/09/2006
25. 60701743744 00650 59371.00 26/09/2006 26/09/2006
26. 60701743733 00651 55346.00 30/09/2006 30/09/2006
27. 60701743755 00652 57163.66 03/10/2006 03/10/2006
28. 60701893076 00666 52773.00 07/10/2006 07/10/2006 TOTAL AMOUNT 24,06,999.00
3. The defendant no.1 after various reminders paid a sum of Rs.5 lakhs by cheque no.995521 dated 27.10.2006 towards part payment. Hence after adjustment of previous balance of Rs.42,749/, a sum of Rs.19,49,748/ remained balance and defendants despite various assurances did not clear the said amount. CS No.613559/16 & CS 619342/16 (Counter Claim) Page 5 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. Hence, plaintiff sent demand notice dated 19.03.2007 called upon the defendants to pay the outstanding amount of Rs.21,46,348.80 together with interest @ 18% per annum but defendant in reply dated 04.04.2007 to the demand notice falsely claimed that the plaintiff owes a sum of Rs.14,36,982/ towards incentive commission @ 2% on total business. It is further stated that the cheque of Rs.5 lacs was not paid as a security towards future shipment. Thus plaintiff through its letter dated 08.05.2007 denied the averments of the defendant and filed the present case for recovery of the said amount.
4. Defendant filed written statement along with counter claim in which defendants admitted that defendant no.1 is a partnership firm and defendant no.2 and 3 are its partners however, it is denied that plaintiff is an IATA agent or that plaintiff company is dealing in custom clearance. It is also denied that defendant company approached to the plaintiff in the year 198384 and thereafter plaintiff started rendering the service to defendant no.1 to the alleged period. It is stated that the plaintiff used to send the invoices along with the airway bills of airlines. The airway bills sent by the plaintiff to the defendants were without signatures and stamp of the airlines, however the defendants used to make the payment to the plaintiff in good faith and considering old relations. The freight charges mentioned in the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 6 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. airway bills are excess, exorbitant and arbitrary as the plaintiff himself forged and fabricated the airway bills. Further, it is denied that till June 2006, the outstanding amount of Rs.18,42,749/ was due against the defendants and an amount of Rs.42,749/ was outstanding upto June 2006. It is also denied that a sum of Rs.5 lakh was paid by the defendants to the plaintiff as part payment but it is stated that said amount was paid in good faith and the plaintiff is liable to refund the same. It is also denied that the value of consignment for the period 30.06.2006 to 07.10.2006 was sum of Rs.24,06,999/ and a sum of Rs.19,49,748/ was outstanding against the defendant. It is also denied that the claim of defendants of Rs.14,36,982/ towards the incentive @ 2% on the total business is false.
5. In the counter claim filed by the defendant, the same facts as stated in the written statement were reiterated and further it is stated that the defendant started business with the plaintiff in the year 198384 and it was agreed that plaintiff shall give 2% incentive out of the total business provided by the defendant to the plaintiff and said 2% incentive will be either adjusted in the bills or paid to the defendants. It is stated that during the course of transactions, a huge amount become due towards the plaintiff on the said amount and plaintiff started avoiding to pay the same. Defendant also came to know that plaintiff in order to commit fraud CS No.613559/16 & CS 619342/16 (Counter Claim) Page 7 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. and cheat the defendants started forging and fabricating the bills of transport agencies and shipping lines by over charging the said bills and despite asking plaintiff failed to provide the original copies of the transport bills as well as bills of the shipping lines along with invoices raised by the plaintiff. It is stated that cheque of Rs.5 lacs was given to the plaintiff as security towards future shipment, however after the issuance of said cheque no shipment was sent. It is further stated that plaintiff is a CHA company and is bound to charge the transportation and shipping charges on actual basis and not more than the amount of the said agencies. It is stated that defendant is entitled to recover a sum of Rs. 19,36,192/ towards incentive and a sum of Rs. 5 lakh as cheque amount which was given as security.
6. Plaintiff filed replication to the written statement of defendant as well as written statement to the counter claim in which he has denied the contents of the written statement of the defendant as incorrect and reiterated the contents of plaint as true and correct. In reply to the counter claim, the preliminary objection was taken that the alleged claim pertain to the year 198384 which has been filed in the year 2007 after 23 years, hence liable to be dismissed in limine. On merits, plaintiff has denied that it has ever agreed that the plaintiff shall either give 2% discount/ CS No.613559/16 & CS 619342/16 (Counter Claim) Page 8 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. incentive in the bills or pay the said amount to the defendants. It is also denied that defendant is entitled to recover a sum of Rs.19,36,982/ from the plaintiff.
7. Defendants have filed replication of the counter claim in which he denied the contents of the written statement of counter claim filed by the plaintiff as incorrect and reiterated the contents of counter claim as true and correct.
8. Vide order dated 16.05.2008, the following issues were framed:
1. Whether the suit of the plaintiff is liable to be dismissed under Order 7 Rule 11 CPC? (OPD)
2. Whether the suit has been signed, verified and instituted by a duly authorized person? (OPD)
3. Whether the suit is time barred? (OPD)
4. Whether the plaintiff is entitled to the amount, as claimed in the suit? (OPP)
5. Whether the plaintiff is entitled to any interest on the said amount? If so, its quantum and period? (OPP)
6. Whether the claim of the defendant is liable to be dismissed under Order 7 R 11 CPC? (OPP)
7. Whether the claim of the defendant is time barred?
(OPP)
8. Whether the claim of the defendant as claimed in the capacity of an unregistered partnership is barred CS No.613559/16 & CS 619342/16 (Counter Claim) Page 9 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
under Section 69 of the Partnership Act? (OPP)
9. Whether the defendant is entitled to the amount as claimed in the counter claim? (OPD)
10. Whether the defendant is entitled to any interest on the said amount? If so, its quantum and period? (OPD)
11. Whether the defendant is entitled for decree of rendition of accounts? If so, its effect? (OPD)
9. In order to prove its case, plaintiff company has examined Sh. Ravi Kumar Agarwal, its Accounts Officer as PW1 and Sh. Bhup Kumar, its manager as PW2.
10. On the other hand, defendant company has only examined Sh. Ishtiaque Ahmad, its partner as DW1.
11. Arguments were heard from Sh. R.K. Goel, Ld. Counsel for the plaintiff and Sh. Firoz Khan Ghaji and Sh .Abhishek Kumar, Ld. Counsel for the defendants.
12. I have considered the arguments and gone through the records. My issuewise findings are as under : CS No.613559/16 & CS 619342/16 (Counter Claim) Page 10 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. ISSUE NO.1 "Whether the suit of the plaintiff is liable to be dismissed under Order 7 Rule 11 CPC? (OPD)"
13. The onus to prove this issue is upon the defendants as defendants in the written statement have stated that suit of the plaintiff is without cause of action but defendant through evidence of DW1 Sh. Ishtiaque Ahmad only has stated that bills of the plaintiff are forged and false bills which have been raised after adding arbitrary amount. However, DW1 in the affidavit has admitted that the services of the plaintiff were obtained and though according to him same were not upto the mark and stated that defendants are not liable to pay the amount of Rs.19,49,748/.
In his crossexamination, he has admitted that at an average of 3 to 5 consignments per month were sent by the defendant no.1 through the plaintiff company.
14. On the other hand, plaintiff through the evidence of PW1 Sh. Ravi Kumar Aggarwal had deposed that plaintiff had sent the consignments of the defendant and raised invoices Ex.P2 to Ex.P29 on which payment has not been made by the defendants. In the crossexamination also, he has denied the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 11 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. suggestion that the plaintiff company had not been handing over to the defendants original copies of the bills as well as sent original airways bills. He has denied the suggestion that the receipt obtained from the delivery of bills etc. from the defendants are not issued by defendants.
15. Thus from the testimony of plaintiff and defendant witnesses, it is evident that plaintiff and defendant were doing business as plaintiff company was sending the goods of the defendants abroad through airlines and raising bills time to time and defendants were making payment. According to testimony of PW1 there was dues of bills Ex.P2 to Ex.P29 for a sum of Rs.19,49,748/. Hence, in these circumstances, it cannot be said that suit of the plaintiff is without any cause of action. Therefore, issue no.1 is decided in favour of the plaintiff and against the defendants.
ISSUE NO.2 "Whether the suit has been signed, verified and instituted by a duly authorized person? (OPD)".
16. Ld. Counsel for the defendants has contended that plaintiff company has not file any certificate of incorporation there is no authority in favour of the Sh. CS No.613559/16 & CS 619342/16 (Counter Claim) Page 12 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. Ravi Kumar Aggarwal who has filed the suit on behalf of the plaintiff and plaintiff has also during the evidence of his witnesses have failed to prove that Sh. Ravi Kumar Aggarwal has any authority to institute the present suit, therefore suit of the plaintiff is liable to be dismissed. In support of his contention he has relied upon testimony of DW1 Sh. Ishtiaque Ahmad.
17. On the other hand, Ld. Counsel for the plaintiff has contended that plaintiff through the testimony of PW1 has proved that Sh. Ravi Kumar Aggarwal has authority to file the present suit as he proved the minutes of meeting Ex.P1. In support of his contention he has relied upon testimony of PW1 Sh. Ravi Kumar Aggarwal .
18. I have considered the submissions and gone through the records. As far as contention of the Ld. Counsel for defendant that plaintiff company had not file any certificate of incorporation therefore suit is liable to be dismissed. In my view no such objection has been taken in written statement that suit is liable tom be dismissed as plaintiff company has not produced certificate of incorporation nor any such issue was framed hence said objection cannot be raised.
19. Defendants in the written statement have taken the objection that Sh. Ravi Kumar Agarwal is neither the official nor has any authority or resolution in his CS No.613559/16 & CS 619342/16 (Counter Claim) Page 13 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. favour to file the present suit and no resolution was passed in favour of Sh. Ravi Kumar Agarwal for filing the present suit.
20. The defendant in order to prove the same has examined DW1 Sh.Ishtiaque Ahmad who again reiterated in his evidence led through affidavit Ex.DW1/A that plaintiff company is not incorporated under the Companies Act and Sh. Ravi Kumar Aggarwal has no authority to sign, verify or institute the present suit.
21. In these circumstances, in my view the onus is shifted upon the plaintiff to prove that Sh. Ravi Kumar Aggarwal has any authority or resolution in his favour to institute the present suit. In order to prove the same, Ld. Counsel for the plaintiff has relied upon the testimony of PW1 Sh. Ravi Kumar Agarwal who has deposed in his testimony led by way of affidavit Ex.PW1/1 that he is Accounts officer of the plaintiff company and duly authorized to sign, verify and institute the present suit. The present suit was instituted by him on behalf of the plaintiff company by virtue of resolution dated 21.04.2007 passed by Board of Directors. He proved the extract of minutes of meeting dated 21.04.2007 of the plaintiff company as Ex.P1.
22. The plaint has been filed by Sh. Ravi Kumar Agarwal in the capacity of duly authorized AR of the plaintiff company though in the plaint he has mentioned that plaintiff company has authorized him vide board resolution dated 21.04.2007 CS No.613559/16 & CS 619342/16 (Counter Claim) Page 14 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. passed by board of directors of the plaintiff but on perusal of the file, I did not find any board resolution on record. From the testimony of PW1 it is evident that though he has also stated that board resolution dated 21.04.2007 was passed by board of directors of the company but he has proved only extract of the minutes of meeting of board of directors held on 21.04.2007 in which it is mentioned that he was authorized to prosecute all actions on behalf of the company, to sign, verify and affirm the plaint, institute the suit, file application(s), affidavits, appeals etc. No suggestion has been given to PW1 by the defendants that said minutes of meeting are forged and fabricated. Hence, in my view plaintiff has been able to prove that Sh. Ravi Kumar Agarwal was authorized by the plaintiff company to file the present suit against the defendants. Issue no.2 is decided in favour of the plaintiff and against the defendants.
ISSUE NO.3 "Whether the suit is time barred? (OPD)."
23. Defendants in the written statement have taken the preliminary objection no.6 that suit is barred by limitation. Undisputedly, plaintiff was shipping the goods of the defendant abroad. The period of limitation in filing of suit for CS No.613559/16 & CS 619342/16 (Counter Claim) Page 15 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. recovery of price for the work done is three years as per entry 18 of Limitation Act which is to be counted from the date when the work is done. But as per section 19 of the Limitation Act if payment is made before the expiry of prescribed period by the person liable to pay then a fresh period of limitation is to be computed from the time payment is made.
24. Plaintiff through the testimony of PW1 has deposed that on 12.06.2006 the total outstanding against the defendant was Rs.18,42,749/. The defendants made part payment in the sum of Rs. 10 lakhs on 14.07.2006 and Rs.8 lakhs on 18.09.2006 and thus a sum of Rs.42,479/ remained balance upto 12.06.2006. From 13.06.2006 to 07.10.2006, plaintiff sent defendants goods vide invoices Ex.P2 to Ex.P29 for a total sum of Rs.24,06,999/ and defendants in order to clear the said amount give a cheque of Rs.5 lakhs on 27.10.2006 towards part payment and from the said amount of Rs.5 lakhs previous balance of Rs.42,749/ upto 12.06.06 was adjusted and remaining Rs.4,57,251/ was adjusted from the sum of Rs. 24,06,999/ for the bills of 13.06.2006 to 07.10.2006 and the amount which is left unpaid is Rs.19,49,748/ as outstanding from the defendants. In order to prove the same he has further proved the account ledger/statement for 01.04.2006 to 28.10.2006 as Ex.P123. From the statement, it is evident that a sum of CS No.613559/16 & CS 619342/16 (Counter Claim) Page 16 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. Rs.21,46,348/ has been shown as balance. Further from the account ledger of the defendant company maintained by the plaintiff, it is evident that Rs.5 lakhs has been reflected as payment paid by defendant vide cheque.
25. The defendants as stated above in the written statement has not denied of giving the said cheque of Rs.5 lakhs but only has taken the plea that the said cheque was given as security for future shipments. In the crossexamination of PW1, he has denied that the cheque of Rs.5 lakhs was issued by defendants in favour of the plaintiff company as a security for future shipments till the settlement of account between them.
26. I am agree with the contention of Ld. Counsel for the plaintiff that once defendant admit of giving Rs.5 lakh cheque on 27.10.2006, onus shifted upon him to prove that said cheque was given as security and not as part payment of the bill. The defendants through the testimony of DW1 though has reiterated the contents of written statement that cheque of Rs.5 lakhs was given as security for future shipment which is denied by the plaintiff by giving suggestion that said cheque was given for adjustment of the previous balance. The DW1 except his oral testimony has not proved any document that the said cheque was given as security, even he did not produce its accounts book to proved that the said cheque has been CS No.613559/16 & CS 619342/16 (Counter Claim) Page 17 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. shown as security amount. Further the defendant did not send any legal notice to the plaintiff that an amount of Rs.5 lakh is due/ lying with the plaintiff company till plaintiff sent the legal notice Ex. P124 dated 19.03.2007. Even defendants after receiving the rejoinder/ reply of his notice dated 08.05.2007 wherein he has categorically stated that Rs.5 lakhs was given as part payment, did not take any action by filing the suit against the plaintiff and only after filing of suit by the plaintiff has filed the counter claim. Admittedly plaintiff and defendant were doing business since long. DW1 has not deposed that for earlier transaction also it paid any amount as security. Further DW1 has also not deposed that plaintiff company has demanded from defendant company to pay Rs. 500,000/ as security for doing future transaction. Therefore I do not see why defendant will pay such a huge amount of Rs. 500,000/ as security. Hence, in these circumstances, I did not find testimony of DW1 reliable that Rs.5 lakh was given as security and not as part payment of the balance dues of the plaintiff.
27. Further PW1 has categorically deposed that Rs. 5,00,000/ was given vide cheque dt.27.10.2007 towards the dues upto June 2006. No suggestion has been given by the defendant counsel to PW1 that the goods of plaintiff have not been shipped through invoices Ex.P2 to Ex.P29 and only plea of the defendants is CS No.613559/16 & CS 619342/16 (Counter Claim) Page 18 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. that bill raised by the plaintiff is excessive and the plaintiff has not given the 2% rebate. This also proved that there were ongoing account between the plaintiff and defendant hence no question of defendant paying security amount arise therefore in these circumstances, in my view when there was ongoing account between the plaintiff and defendant which has not been settled till defendants has made the payment of Rs.5 lakh which in my view was not paid as security cheque for future shipment but was paid as part payment. Rs. 500,000/ was paid on 27.10.2006. The suit filed on 12.07.2007, hence the suit has been filed within three years of the last payment made by defendant, therefore suit of the plaintiff is within limitation. Hence, Issue no.3 is decided in favour of the plaintiff and against the defendants. ISSUE NO.4 "Whether the plaintiff is entitled to the amount, as claimed in the suit? (OPP)"
28. The onus to prove this issue is upon the plaintiff. Plaintiff in order to prove his case has examined PW1 Sh. Ravi Kumar. He has deposed that plaintiff company was an IATA agent and used to send goods of the defendants abroad and raised bills time to time and on 12.06.2006 an outstanding amount of Rs.18,42,749/ was due out of which defendant paid Rs.18 lakhs and a sum of Rs.42,749/ CS No.613559/16 & CS 619342/16 (Counter Claim) Page 19 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. remained balance. Thereafter, plaintiff has sent 28 shipments vide invoices Ex.P2 to Ex.P29 and the sum of Rs.19,49,748/ was due after adjustment. He proved the copies of the airway bills as Ex.P30 to Ex.P57 and other airway bills as Ex.PW58 to Ex.PW83, copies of other invoices as Ex.PW84 to Ex.PW111, true copy of the account ledger for 01.01.1996 to 31.03.96 as Ex.P112, certified true copy of the account ledger for 1.04.97 to 31.03.98 as Ex.P113, certified true copy of account ledger for 3.4.96 to 31.3.98 as Ex.P114, certified true copy of account ledger for 1.4.98 to 31.3.99 as Ex.P115, certified true copy of account ledger for 1.4.99 to 31.3.2000 as Ex.P116, certified true copy of the account ledger for 1.4.2000 to 31.3.2001 as Ex.P117, certified true copy of the account ledger for 1.4.2001 to 31.3.2002 as Ex.P118, certified true copy of the account ledger for 1.4.2002 to 31.03.2003 as Ex.P119, certified true copy of the account ledger for 1.4.2003 to 31.3.2004 as Ex.P120, certified true copy of the account ledger for 1.4.2004 to 31.3.2005 as Ex.P121, certified true copy of the account ledger for 1.4.2005 to 31.3.2006 as Ex.P122, certified true copy of the account ledger for 1.4.2006 to 28.10.2006 as Ex.P123, copy of demand notice is Ex.P124, the reply to the demand notice of the plaintiff as Ex.P125 and copy of reply to the reply of the demand notice as Ex.P126.
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 20 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
29. In his crossexamination, PW1 has admitted that the shipment are sent to the airport by the defendant and form there and there are custom clearance are process and the shipment was sent to its destines on the same day. The plaintiff company raised the bills after clearing shipments. The bills are sent along with original airway bills, shipping bills by attested custom as well as original invoices attested by custom officer are sent to the office of the defendants by hand. They obtained the receipt from the defendants against each bill sent along with original airways bills deliver to the defendants. He admitted the suggestion that the receipt of the bill etc. obtained from the defendants had not been placed on record by plaintiff company. He denied the suggestion that the receipts obtained from the delivery of the bills etc. from the defendants are not placed on record as the plaintiff company do not have any such receipt. He admitted the suggestion that the defendant company have not issued any receipts as original bills have never been sent to the defendant. He denied the suggestion that defendants do not owe any amount to the plaintiff company or that plaintiff company owes a sum of Rs.14,36,982/ to the defendants. He denied the suggestion that cheque of Rs.5 lakhs was issued as security.
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 21 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
30. Ld. Counsel for the plaintiff contended that from the testimony of PW1 and the documents Ex.P2 to Ex.P29, it is proved that plaintiff was shipping the goods of defendant abroad through the airlines being IATA agent and raising bills time to time and a sum of Rs.42,749/ was due on 12.06.2006 and a sum of Rs.5 lakh was paid on 27.10.2006 and after adjusting the previous balance, a sum of Rs.19,49,748/ remained balance. Ld. Counsel for the plaintiff also submits that the counter claim of the defendant is liable to be dismissed first because no amount can be claimed beyond the period of three years hence even if defendant is entitled to 2% incentive he can recover only three years prior to filing of the counter claim and secondly the defendant has not produced any document that 2% incentive has to be given to the defendant from the commission which plaintiff used to get being IATA agent. Hence, in these circumstances the counter claim of the defendant is liable to be dismissed and suit of the plaintiff be allowed and a decree of Rs.19,49,748/ be passed in favour of the plaintiff.
31. On the other hand, defendants in order to prove that he is not liable to pay any amount and even defendants are entitled to recover an amount of Rs.19,36,982/ from the plaintiff, has relied upon testimony of DW1 Ishtiaque Ahmad, its partner who in his testimony led through affidavit Ex.DW1/A has CS No.613559/16 & CS 619342/16 (Counter Claim) Page 22 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. deposed that the IATA agent is entitled for the commission on the shipment and the bills are drawn on the basis of the actual payment made to the airlines and the said bills are sent along with bills of agents. The services of the plaintiff were not upto the mark and discrepancies in the bills of the plaintiff were pointed out to the plaintiff but plaintiff did not give any heed to the request of the defendant to give 2% incentive. He further stated that there was no outstanding of Rs.42,749/ upto June, 2006 or any due of Rs.18,42,749/ against the defendants. He further deposed that the bills of Rs.19,49,748/ are forged and fabricated bills which has been raised after adding arbitrary amounts in the airways bills. He further deposed that Rs.5 lakh was given in good faith and the plaintiff is liable to return the said amount. Further it is stated that defendant is entitled to recover Rs.19,36,982/ towards incentive @2% on the total business as agreed between the plaintiff and defendant. He has proved his ledger account from 01.01.1996 to 31.03.1996 as MarkA.
32. In his crossexamination, he has stated that at an average of 3 to 5 consignment per month were sent by the defendant no.1 through the plaintiff company. The incentive @ 2% was given on account of defendant's firm to do business with plaintiff company and IATA and other agencies used to pay incentive @ 5% to 6% to the plaintiff company. There is no agreement in writing between the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 23 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. plaintiff company and the defendant's firm regarding the payment of incentive @ 2% by the plaintiff company to the defendant's firm. He cannot say how much amount is inflated in which of the bill numbers. He admitted the suggestion that plaintiff was never informed in writing about any such discrepancies in the bills. He denied the suggestion that there were no discrepancies in the bills or that defendant has taken false defence. He admitted the suggestion that there was no written agreement of 2% incentive. He admitted the suggestion that payment of bills of the plaintiff were not made immediately on receipt of goods and payments was made after accumulation of few bills and supply of goods. He denied the suggestion that defendant is liable to pay Rs.19,49,748/ to the plaintiff. He admitted the suggestion that he has not filed any document that defendant received any such 2% incentive from any other IATA agents. He stated that Rs.5 lakh was paid to the defendant through cheque. He stated that counter claim of the defendant is towards incentives @2% on the goods supplied commencing from the year 1987, till the filing of counter claim.
33. Ld. Counsel for the defendant has contended that from the testimony of defendant/ DW1, it is proved that the plaintiff used to ship goods of the defendants on commission basis being IATA basis. Plaintiff used to get 5% CS No.613559/16 & CS 619342/16 (Counter Claim) Page 24 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. commission and there was an agreement between the plaintiff and defendants that out of this 5% commission, the 2% commission will be given to the defendant as incentive being of higher volume but plaintiff has not given the said incentive since the day of transactions i.e. 198384 which was to be adjusted from the total bill raised by the plaintiff, hence instead of plaintiff recovering the amount of Rs.19,49,748/, defendant is entitled to recover the amount of Rs.19,36,982/. Therefore suit of the plaintiff is liable to be dismissed and counter claim of the defendant be allowed and a decree of Rs.19,36,982/ be passed in favour of the defendant.
34. I have considered the submissions and gone through the record. From the testimony of the plaintiff as well as defendant, the undisputed fact emerged that :
(i) Plaintiff was an IATA agent;
(ii) Plaintiff used to book shipments of goods like fish meet etc, of the defendants through airlines and used to charge the Air freight of from the defendants
(iii) business was going on between the plaintiff and defendant since 198384.
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 25 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
35. PW1 has deposed that original bills/invoices EXP2 to P29 alongwith airways bill EXP30 to P57were sent to the defendants and shippers copies are in possession of the defendants and office copies are with the plaintiff. In the cross examination also PW1 has stated that shipment like meet, fish etc., are sent to the airport by the defendant and from there custom clearance are process and shipment was sent to different destination on the same day. Before the shipment comes up invoices, packing list and relevant documents are handed over to plaintiff company. The bills are sent alongwith original airways bills, shipping bills by attested customs as well as original invoices are sent to the office of the defendants by hand and they obtained the receipt against each bills deliver to the defendants. Hence nothing much has came out in his cross examination to disbelieve his testimony.
36. From the testimony of PW1 it is proved that plaintiff company exported the goods of the defendants and raised the invoices Ex. P2 to P29 in between 13.06.2006 to 07.10.2006 for a sum of Rs.24,06,999/. Though suggestion has been given to the PW1 that the bills Ex.P2 to P29, Ex.P3037, Ex.P58 to 83 and Ex.P84 to Ex.P112 are false and fabricated but on perusal of the plaint I found that in para 10 of the plaint the plaintiff has stated that the goods from 13.06.2006 to 07.10.2006 have been shipped for a sum of Rs.24,06,999/ and he has given the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 26 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. details of above said invoices EX2 to P29 and stated that an amount of Rs. 1949748 is due after adjusting the amount of Rs. 457251.
37. Defendants in para 10 of the written statement has denied that payment towards the shipments was not cleared by the defendants and stated that in fact entire amount was cleared, thus the defendants have not denied in the written statement that its goods were not shipped on such dates through the plaintiff and his only defence is that the entire amount was cleared. Though in the said paragraph it is also stated that bills are forged and fabricated but again it was not stated that on the dates as mentioned in the bills/ invoices its goods were not shipped through the plaintiff. Even DW1 in his evidence affidavit Ex.DW1/A has not denied of shipping the goods by the plaintiff on the daters mentioned in the invoices and Air Frieght bills through and only stated in para 10 of his affidavit that the bills of Rs.19,49,748/ are forged and false bills which has been raised after adding arbitrary amounts in the airways bills. Therefore it is proved that plaintiff has sent the goods of the defendant through the airlines as mention in above airways bills and raised the bill vide above invoices.
38. Further PW1 has deposed that till June 12, 2006 a sum of Rs.18,42,749/ was due and defendants made the part payment of Rs.10 lakhs on CS No.613559/16 & CS 619342/16 (Counter Claim) Page 27 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. 14.07.2006 and Rs.8 lakhs on 18.09.2006 and a sum of Rs.42,749/ was balance. The defendant has not given any suggestion to the PW1 that Rs.18 lakhs as deposed by the plaintiff has not been paid. PW1 has also deposed that Rs.5 lakh was paid by the defendants vide cheque no.995521 dated 27.04.2006 which has been adjusted, hence a total balance comes to Rs.19,49,748/.
39. The testimony of PW1 with regard to the payment of Rs.18 lakhs and Rs. 5,00,000/ duly corroborated from the account ledger for the period 01.04.2006 to 28.10.2006 Ex.P123 as the amount of Rs.10 lakhs and Rs.8 lakh is reflected on the above said dates. Therefore, there is no reason to disbelieve the testimony of PW1 that after making payment of RS.18 lakhs, a sum of Rs. 42,749/ remained balance. Further PW1 has deposed that till June 12, 2006 a sum of Rs. 18,42,749/ was due and defendants made the part payment of Rs.10 lakhs on 14.07.2006 and Rs.8 lakhs on 18.09.2006 and a sum of Rs.42,749/ was balance. The defendant has not given any suggestion to the PW1 that Rs.18 lakhs as deposed by the plaintiff has not been paid.
40. As far as contention of Ld. Counsel for the defendants that Rs.5 lakhs was not paid as clearance of the balance amount due against the plaintiff but as advance, the defendants/ DW1 though in his testimony through affidavit CS No.613559/16 & CS 619342/16 (Counter Claim) Page 28 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. Ex.DW1/A has deposed the said fact but in support of the said contention has not filed any document i.e. statement of account showing Rs.5 lakhs as advance paid to the plaintiff.
41. Moreover, I am agree with the contention of Ld. Counsel for the plaintiff that there is no reason for the defendants to pay advance of such a big amount to the plaintiff as on the one hand defendants is claiming that it is entitled to recover Rs.19,49,748/ as 2% incentive and on the other hand it is paying the advance of Rs.5 lakhs.
42. I am not agree with the contention of Ld. Counsel for defendant that plaintiff has not complied the provision of section 65B of Evidence Act therefore invoices EXP2 to P29 and P84 to P111 are not proved. Plaintiff has examined Sh Bhoop Singh its manager as PW2 who led his evidence by was of affidavit EXPW2/A. He deposed that plaintiff company has authorized him to prosecute present suit vide Board resolution dated 9th July 2006 EXPW2/1 and He further deposed that invoices Ex.P2 to Ex.P29 and other invoices as Ex.PW84 to Ex.PW111, account ledger Ex.P112 to EXP123 are computer output as defined in section 65B of Indian Evidence Act 1972 and invoices & ledger statement of ledger were fed is being used by plaintiff for regular storage of data in ordinary course of CS No.613559/16 & CS 619342/16 (Counter Claim) Page 29 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. business and computer is in custody of plaintiff company. He proves certificate u/s 65B as EXPW2/2. Hence in my view requirement of section 65(b) of Indian Evidence Act has been complied.
43. I do not find force in the contention of Ld. Counsel for defendant that since PW2 in his cross examination has stated that he is working in the plaintiff company for last two years and has no personnel knowledge of the case and has made entry in the computer at the relevant time therefore certificated u/s 65B evidence Act is not as per Indian Evidence Act therefore invoices EX P2 to P29 cannot be read in evidence. The account ledger is of year 1996 to 2007. It cannot be expected that the person who feeds these account ledger detail in computer will be available. There is no such requirement imposed by the statue. Hence there is no ground to hold that certificate u/s 65B Evidence Act proved by PW2 is not valid and the invoices EXP2 to P29 P84 to P111 are not proved. In this regard I rely upon ICICI Bank vs Surbhi Gupta 2018SCC online Delhi 6949 wherein while setting aside the order of trial court dismissing the suit it has been held :
"14. Section 34 of the Evidence Act clearly provides that the books of accounts maintained in electronic form are relevant. Under Section 62 of the Evidence Act, original documents constitute CS No.613559/16 & CS 619342/16 (Counter Claim) Page 30 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
primary evidence. In the context of electronic evidence, printouts of electronic documents are as secondary. However, judicial notice needs to be taken of the fact that most accounts today are not maintained in paper form, but electronic form. The primary evidence could be the server on which the statement of accounts is stored. These servers may store the statement of accounts of multiple clients in the hard drive. It would be an impossibility to require the Plaintiff bank to produce the hard drive of the server in every suit for recovery filed by it. Under such circumstances, the Plaintiff bank has no option but to produce the secondary evidence i.e., a printout of statement of accounts, duly certified by a responsible official of the bank along with a certificate under Section 65B of the Evidence Act. Needless to add, the certificate under Section 65B of the Evidence Act has now become a usual practice in almost all of the suits, inasmuch as, in every such suit, parties are bound to place reliance on electronic documents. The mere fact, that the printout is being filed as secondary evidence along with the necessary certificate, does not make it any less valid. The said accounts statement would be rebuttable if any discrepancy is found or pointed out. But in the absence of the same, there is no reason as to why the statement of accounts filed by the Plaintiff bank should be disbelieved. The Supreme Court in Anvar P.V. v. P.K. Basheer (2014) 10 SCC 473 :
AIR 2015 SC 180 (hereinafter, Anvar v. Basheer'), while addressing CS No.613559/16 & CS 619342/16 (Counter Claim) Page 31 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
the issue of admissibility of electronic evidence and Section 65B of the Evidence Act held as under:
"13. Any documentary evidence by way of an electronic record under the Evidence Act, in view of Sections 59 and 65A, can be proved only in accordance with the procedure prescribed under Section 65B. Section 65B deals with the admissibility of the electronic record. The purpose of these provisions is to sanctify secondary evidence in electronic form, generated by a computer. It may be noted that the Section starts with a non obstante clause. Thus, notwithstanding anything contained in the Evidence Act, any information contained in an electronic record which is printed on a paper, stored, recorded or copied in optical or magnetic media produced by a computer shall be deemed to be a document only if the conditions mentioned Under Subsection (2) are satisfied, without further proof or production of the original. The very admissibility of such a document, i.e., electronic record which is called as computer output, depends on the satisfaction of the four conditions Under Section 65B(2). Following are the specified conditions Under Section 65B(2) of the Evidence Act:
(i) The electronic record containing the information should have been produced by the computer during the period over which the same was regularly used to store or process information for the purpose of any activity regularly carried on over that period by the person having lawful control over the use of that computer;CS No.613559/16 & CS 619342/16 (Counter Claim) Page 32 of 55
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(ii) The information of the kind contained in electronic record or of the kind from which the information is derived was regularly fed into the computer in the ordinary course of the said activity;
(iii) During the material part of the said period, the computer was operating properly and that even if it was not operating properly for some time, the break or breaks had not affected either the record or the accuracy ofits contents; and
(iv) The information contained in the record should be a reproduction or derivation from the information fed into the computer in the ordinary course of the said activity
14. Under Section 65B(4) of the Evidence Act, if it is desired to give a statement in any proceedings pertaining to an electronic record, it is permissible provided the following conditions are satisfied:
(a) There must be a certificate which identifies the electronic record containing the statement;
(b) The certificate must describe the manner in which the electronic record was produced;
(c) The certificate must furnish the particulars of the device involved in the production of that record;
(d) The certificate must deal with the applicable conditions mentioned Under Section 65B(2) of the Evidence Act; and
(e) The certificate must be signed by a person occupying a responsible official position in relation to the operation of the relevant device.
15. It is further clarified that the person need only to state in the certificate that the same is to the best of his knowledge and belief. Most importantly, such a certificate must accompany the electronic CS No.613559/16 & CS 619342/16 (Counter Claim) Page 33 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
record like computer printout, Compact Disc (CD), Video Compact Disc (VCD), pen drive, etc., pertaining to which a statement is sought to be given in evidence, when the same is produced in evidence. All these safeguards are taken to ensure the source and authenticity, which are the two hallmarks pertaining to electronic record sought to be used as evidence. Electronic records being more susceptible to tampering, alteration, transposition, excision, etc. without such safeguards, the whole trial based on proof of electronic records can lead to travesty of justice.
16. Only if the electronic record is duly produced in terms of Section 65B of the Evidence Act, the question would arise as to the genuineness thereof and in that situation, resort can be made to Section 45A opinion of examiner of electronic evidence.
17. The Evidence Act does not contemplate or permit the proof of an electronic record by oral evidence if requirements Under Section 65B of the Evidence Act are not complied with, as the law now stands in India.
.......................
22. The evidence relating to electronic record, as noted herein before, being a special provision, the general law on secondary evidence Under Section 63 read with Section 65 of the Evidence Act shall yield to the same. Generalia special bus non derogant, special law will always prevail over the general law. It appears, the court omitted to take note of Sections 59 and 65A dealing with the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 34 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
admissibility of electronic record. Sections 63 and 65 have no application in the case of secondary evidence by way of electronic record; the same is wholly governed by Sections 65A and 65B. To that extent, the statement of law on admissibility of secondary evidence pertaining to electronic record, as stated by this Court in Navjot Sandhu case (supra), does not lay down the correct legal position. It requires to be overruled and we do so. An electronic record by way of secondary evidence shall not be admitted in evidence unless the requirements Under Section 65B are satisfied. Thus, in the case of CD, VCD, chip, etc., the same shall be accompanied by the certificate in terms of Section 65B obtained at the time of taking the document, without which, the secondary evidence pertaining to that electronic record, is inadmissible."
15. The above judgement was followed in Harpal Singh v. State of Punjab AIR 2016 SC 5389 and by a Division Bench of this Court in Kundan Singh v. State I (2016) CCR1 (Del). A Single Judge of this Court, relying on Anvar v. Basheer (supra), in ELI Lilly v. Maiden Pharmaceuticals 2017 (161) DRJ 65 held as under:
"18. Though the ratio of Anvar P.V. supra, to me, appears to require the certificate/affidavit under Section 65B of the Evidence Act to accompany the electronic record when produced in the Court, and a learned Single Judge of this Court also in Ankur Chawla v. Central Bureau of Investigation opining so acquitted the petitioner/accused therein (though the SLP is pending in the Supreme Court) but a CS No.613559/16 & CS 619342/16 (Counter Claim) Page 35 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
Single Judge of the High Court of Rajasthan in Paras Jain v. State of Rajasthan did not agree with the judgment of this Court in Ankur Chawla supra observing that "when legal position is that additional evidence, oral or documentary, can be produced during the course of trial ifin the opinion of the Court production of it is essential for the proper disposal of the case, how it can be held that the certificate as required under Section 65B of the Evidence Act cannot be produced subsequently in any circumstances if the same was not procured alongwith the electronic record and not produced in the Court with the chargesheet. In my opinion it is only an irregularity not going to the root of the matter and is curable". A Division Bench of this Court in Kundan Singh v. State also, on a reading of Anvar P.V. supra, disagreed with the view taken in Ankur Chawla supra and held that the words "produced in evidence" did not postulate or propound a ratio that the computer output when reproduced as a paper print out or on optical or magnetic media must be simultaneously certified by an authorised person under Section 65 B(4). It was held that all that is necessary is that the person giving the certificate under Section 65B(4) should be in a position to certify and state that the electronic record meets the stipulations and conditions mentioned in Section 65B(2), identify the electronic record, describe the manner in which computer output was produced and also give particulars of the device involved in production of the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 36 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
electronic record for the purpose of showing that the electronic record was prepared by the computer. It was further held that emails are downloaded and computer output, in the form of paper prints, are taken every day; these emails may become relevant and important electronic evidence subsequently; it is difficult to conceive and accept that the emails would be inadmissible, if the official who downloaded them and had taken printouts had failed to, on that occasion or simultaneously record a certificate under Section 65B. .................
20. It thus but has to be held that the plaintiffs are entitled to file the certificate under Section 65B of the Evidence Act, even subsequent to the filing of the electronic record in the Court. Order XI Rule 6 ofCPC as applicable to commercial suits is also not found to provide to the contrary."
16. In the present case, the Plaintiff bank has filed the certificate under Section 65B through its witness and appended it to all the copies of electronic records including bank statements etc., Thus the requirements under Section 65B have been fulfilled.
17. There is however some serious rethinking required on the manner in which electronic documents are to be proved. In each case where electronic documents are involved, it would be impractical to expect the parties to produce the primary evidence which would be the medium on which the document is stored, considering that electronic documents could be stored on hard drives, hard disks, CPUs, microprocessors, cameras, telephones, CS No.613559/16 & CS 619342/16 (Counter Claim) Page 37 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
etc. Certificates under Section 65B accompanying the printouts have simply become standard formats. Cross examination on these certificates can involve debates on model of computer, printer, questions as to who took printouts etc. Courts, therefore, need to take a pragmatic attitude in these cases. Unless there is a serious challenge to the electronic documents i.e., tampering, forgery, hacking, misuse of an email address, change in contents etc., usually printouts of electronic documents ought to be allowed to be read in evidence. The complex procedure laid down for proving of electronic documents can prove to be extremely cumbersome and can have enormous impact especially in commercial transactions, as it has had in the present case."
44. As far as contention of Ld. Counsel for defendant that receipts of bill has not been file therefore delivery of bills not proved. Even though plaintiff has not produced the copy of invoices/ bills having receipt of the defendants officials but merely due to this reason, it cannot be said that invoices have not been sent to defendant, particularly when defendant has not disputed shipment of the goods.
45. In these circumstances I held that plaintiff has been able to prove through his testimony and documents i.e. Ex.P2 to Ex.P29, that he shipped the CS No.613559/16 & CS 619342/16 (Counter Claim) Page 38 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. goods of defendants through airway bills mentioned in the invoices Ex.P2 to Ex.P29.
46. Once plaintiff is able to proved that goods of defendant was exported by plaintiff company and there is no specific denial of defendant of shipping its goods on given dates, the onus is shifted upon defendant to prove what amount has been arbitrary added/excess in the invoice/ airways bill raised by the plaintiff. DW1 nowhere in his testimony has deposed the said fact. Even in his crossexamination, he has admitted that he cannot tell orally as he did not remember as to how much is inflated on which of the bill number. He has also admitted the suggestion that he has never informed plaintiff in writing about any such discrepancies in the bill. Thus in these circumstances, in my view the defendant has failed to prove that the amount in the invoices/ Airways bills mentioned in Ex.P2 to Ex.P29, Ex.P30 to Ex.P83 were not correct and that arbitrary amount has been added in these invoices/ airways bills.
47. As far as defense of defendant is concerned I am agree with the contention of Ld. Counsel for the plaintiff that since the filing of WS defendant has not approached to this court with clean hand, Defendant in WS has denied that plaintiff is an IATA agent and entitle to commission on the shipments or plaintiff company is dealing in custom clearance business but in his testimony DW1 has CS No.613559/16 & CS 619342/16 (Counter Claim) Page 39 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. admitted that defendant is an IATA agent is entitle to the commission on the shipments. Further on the one hand DW1 has deposed that services of the plaintiffs were not availed on credit basis. If that was the case than there is no explanation why defendant was not deducting the 2% as allegedly agreed between the parties with each bill at the time of making payment of each bill to the plaintiff and allowed to accumulate huge amount of more than Rs. 19 Lakh as commission as claimed by defendant in counter claim this led to presumption against defendant it was dealing with the plaintiff on credit basis and use to pay on account payment instead of billwise.
48. Hence, in these circumstances, on analyzing the testimony of both plaintiff and defendants, I held that balance of preponderance of probability is in favour of the plaintiff and against the defendants that plaintiff has shipped the goods of the defendant and has raised the freight bills of Rs.24,06,999/ and a sum of Rs.19,49,748/ is balance which the defendants are liable to pay. Issue no.4 is decided accordingly in favour of the plaintiff and against the defendants. ISSUE NO.5 "Whether the plaintiff is entitled to any interest on the said amount? If so, its CS No.613559/16 & CS 619342/16 (Counter Claim) Page 40 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. quantum and period? (OPP)"
49. In view of my findings of issue no.4 that plaintiff is entitled to sum of Rs.19,49,748/. Since the defendants have deprived the plaintiff from using the said amount, hence defendant is liable to pay interest on the said amount. As per the invoices, the rate of interest is 24% per annum. These are commercial transactions between the plaintiff and defendants but even then in my view the said rate of interest is excessive considering the falling rate of interest on the bank deposit, hence in my view it would be appropriate to grant simple interest only @ 12% p.a. Hence, I held that plaintiff is entitled to simple interest @ 12% p.a. from the date of last delivery made by plaintiff to defendant i.e. 07.10.2006 till the date of decree and thereafter from the date of decree till its realization. Issue no.5 is decided accordingly.
ISSUE NO.6 "Whether the claim of the defendant is liable to be dismissed under Order 7 R 11 CPC? (OPP)"
50. The defendant/ counter claimant in the counter claim has claimed an amount of Rs.19,36,982/ from the plaintiff/ noncounter claimant. Plaintiff/ non CS No.613559/16 & CS 619342/16 (Counter Claim) Page 41 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. counter claimant in the written statement of the counter claim has taken the preliminary objections that the counter claim does not disclose any cause of action, hence same is liable to be rejected U/o 7 Rule 11 CPC. As evident from the counter claim, the defendant/ counter claimant has claimed the said amount on the basis that there was an agreement between the defendants/ counter claimants and plaintiff/ noncounter claimant that out of the total 5% commission received by the plaintiff/ noncounter claimant on freight bills, 2% incentive will be adjusted from the bills of defendants. Since it is a settled law that while deciding the issue U/o 7 Rule 11 CPC, only plaintiff is to be seen which is counter claim in this case and since counter claim disclose that the defendant/ counter claimant is claiming the amount on the basis of agreement between the parties regarding giving 2% incentive from the freight bill of defendant/ counter claimant, hence it cannot be said that the counter claim is without any cause of action, therefore the issue no.6 is decided in favour of the defendants/ counter claimant and against the plaintiff/ noncounter claimant.
ISSUE NO.7 "Whether the claim of the defendant is time barred? (OPP)"CS No.613559/16 & CS 619342/16 (Counter Claim) Page 42 of 55
Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
51. The onus to prove this issue is upon the plaintiff/ noncounter claimant. Plaintiff/ noncounter claimant in the written statement of counter claim has taken the preliminary objection that as per counter claim the alleged claim pertains to the year 198384 which has been filed in the year 2007 after 23 years, hence same is liable to be dismissed in limine.
52. On perusal of the written statement/ counter claim, I found that the counter claimant has mentioned that before starting the business transactions in the year 198384 it was agreed between the parties that plaintiff was given 2% incentive out of total business provided by the defendant to the plaintiff which has not been provided and thus counter claimant is entitled to a sum of Rs.19,36,982/ as incentive and a sum of Rs.5 lakhs towards cheque amount which has been given as security in advance.
53. As far as the amount of Rs.5 lakh is concerned, I have already given my findings in issue no.3 that defendant has failed to prove that same is given as advance but same was given as part payment to clear its due against the amount as mention in invoice EXP2 to P29 therefore counter claimant is not entitled to said amount.
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 43 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
54. Even otherwise also claim of the counter claimant is restricted only to Rs.19,36,982/ as incentive amount which plaintiff/ noncounter claimant has not paid. In his testimony, DW1 had not given any heed to the request of the defendants to give incentive @ 2% as agreed between the plaintiff and defendants and further in para 12 stated that the claim of the defendant is of Rs.14,36,982/ towards the incentive @ 2% on the total business.
55. Since claim of the defendant is recovery of money which become due as plaintiff has not paid the 2% commission from the total 5% commission plaintiff received from airlines on the freight bills of goods of defendant as it would fall in entry 24 of the Limitation Act.
56. In the entire evidence affidavit, DW1 has not explained for which period he has calculated the said amount of Rs.14,36,982/ as incentive. Furthermore as stated above, in the counter claim he has claimed an amount of Rs.19,36,982/ as incentive amount and Rs.5 lakhs separately as security amount given by way of cheque and thus there is a contradiction in the counter claim and the testimony of DW1.
57. Furthermore, DW1 as stated above has not given any details from when he is claiming this amount. I am agree with the contention of Ld. Counsel for CS No.613559/16 & CS 619342/16 (Counter Claim) Page 44 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. the plaintiff that even if there was an agreement between the parties that plaintiff/ noncounter claimant will give 2% incentive which will be adjusted from the bills of the defendants, the defendants cannot claim the amount from the date when they have started doing the business i.e. 198384 as if defendant was entitled to any incentive he should adjust the same from the amount which has been paid against the particular bill or at least at the time of closing of that particular financial year. Hence period of limitation will be 3 year from the date it becomes due. At the best defendant can claim incentive for a period of three years prior to filing of the suit which is counter claim in this case and is an absolute independent claim and not a set off.
58. As stated above, defendants have not produced any statement of accounts showing that for which period it has claimed the said amount. Further no reason has been given by the defendants if it is claiming the amount from 198384 why the same was not adjusted every year. As far as contention of Ld. Counsel for the defendant that since there was running account between the plaintiff and defendants, therefore the period of limitation will not expire but I am not agree with the said contention. Even if there was running account between the parties, the parties have to confirm the account on the ending of the financial year and since in CS No.613559/16 & CS 619342/16 (Counter Claim) Page 45 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. this case no confirmation has been done of the statements of account of the defendants by the plaintiff, even defendants have not produced any statement of accounts showing the amount of incentive in his balance sheet/ statement of account, therefore even if defendants are entitled to 2% incentive, it will be entitled prior to three years of filing the counter claim. Hence, in these circumstances, the claim of the defendant towards 2% incentive is being barred by limitation except for the last three years prior to filing of the counter claim which was filed on 29.08.2007 i.e. 30.08.2004 to 29.08.2007. Issue no.7 is decided accordingly. ISSUE NO.8 "Whether the claim of the defendant as claimed in the capacity of an unregistered partnership is barred under Section 69 of the Partnership Act? (OPP)"
59. As per written statement/ counter claim filed by defendant/ counter claimant with the affidavit of defendant, it is evident that defendant firm is a partnership firm and Sh. Ishtiaque Ahmad is the partner of the defendant firm. I am agree with the contention of Ld. Counsel for the plaintiff/ noncounter claimant that CS No.613559/16 & CS 619342/16 (Counter Claim) Page 46 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. in case of partnership firm in view of section 69 of the Partnership Act, a case can be filed against the party for claiming any amount only when the partnership firm is registered. Relevant portion of Section 69 of the Partnership Act is reproduced below;
"69. Effect of nonregistration.--
(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm. (3) The provisions of subsections (1) and (2) shall apply also to a claim of setoff or other proceeding to enforce a right arising from a contract, but shall not affect,--
(a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or CS No.613559/16 & CS 619342/16 (Counter Claim) Page 47 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
(b) the powers of an official assignee, receiver or Court under the Presidencytowns Insolvency Act, 1909 (3 of 1909) or the Provincial Insolvency Act, 1920 (5 of 1920) to realise the property of an insolvent partner.
(4) This section shall not apply,--
(a) to firms or to partners in firms which have no place of business in 8 [the territories to which this Act extends], or whose places of business in 9 [the said territories], are situated in areas to which, by notification under 10 [section 56], this Chapter does not apply, or
(b) to any suit or claim of setoff not exceeding one hundred rupees in value which, in the Presidencytowns, is not of a kind specified in section 19 of the Presidency Small Cause Courts Act, 1882 (5 of 1882), or, outside the Presidencytowns, is not of a kind specified in the Second Schedule to the Provincial Small Cause Courts Act, 1887 (9 of 1887), or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim".
60. In Delhi Development Authority vs. Kochhar Construction Work & Anr., 1998 (8) SCC 559 wherein it was held that subsequent registration of the partnership firm does not put the suit on proper basis and that its very institution is barred. This position was reiterated in U.P. State Sugar Corporation Ltd. vs. Jain CS No.613559/16 & CS 619342/16 (Counter Claim) Page 48 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. Construction Co. & Anr. (2004) 7 SCC 332.
61. In this case, as evident from the written statement of counter claim, noncounter claimant has taken the specific preliminary objection that the defendant/ counter claimant being unregistered firm, counter claim is barred U/s 69 of the Partnership Act.
62. The onus was upon the defendant/ counter claimant to prove that his firm is registered. DW1 in his evidence affidavit Ex.DW1/A has deposed has not deposed that defendant firm is registered though in his crossexamination he stated that defendant no.1 is registered with the registrar of firm since 1987 but he has not produced any document to prove that defendant firm is a registered partnership firm. Hence, in these circumstances I held that defendants have failed to prove that defendant firm is a registered partnership firm. Hence I held that present counter claim is hit by section 69 of Partnership Act, 1932 hence not maintainable. Therefore, I decide the issue no.8 in favour of the noncounter claimant/ plaintiff and against the defendant/ counter claimant.
ISSUE NO.9 "Whether the defendant is entitled to the amount as claimed in the counter CS No.613559/16 & CS 619342/16 (Counter Claim) Page 49 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. claim? (OPD)"
63. The onus to prove this issue was upon the defendant/ counter claimant. The defendant in order to prove the same has examined DW1 who in his affidavit Ex.DW1/A has deposed in para 4 that the plaintiff has not given any heed to give incentive @ 2% as agreed between the plaintiff and defendant and in para 12 stated that the claim of the defendant is of Rs.14,36,982/ towards the incentive @ 2% on the total business. In his testimony DW1 has not on what basis defendant has arrived to the said figure Rs.14,36,982/. Furthermore as stated above, in the counter claim plaintiff has claimed an amount of Rs.19,36,982/ as incentive amount and Rs.5 lakhs separately as refund of security amount given by way of cheque and thus there is a contradiction in the counter claim and the testimony of DW1.
64. Furthermore onus was upon the defendant to prove that there was any agreement between plaintiff and defendant to pay 2% incentive on total freight charges. But he has not mention on what date or month or year said agreement was entered. In his crossexamination, DW1 has admitted that there was no written agreement of 2% incentive between the plaintiff and defendants. He stated that he repeatedly asked the plaintiff to pay 2% incentive but he did not pay and volunteered CS No.613559/16 & CS 619342/16 (Counter Claim) Page 50 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. that only once plaintiff paid the incentive @ 1.5%. He admitted that nothing was sent to the plaintiff in writing by defendants to claim the incentive. He do not remember the date when the incentive @ 1.5% was paid by plaintiff. He denied the suggestion that no such incentive was ever paid by the plaintiff.
65. From his testimony it is evident that defendant has except his oral testimony and copy of ledger A/c of plaintiff company maintain qua defendant has not produced any written agreement or any other document to support that plaintiff/ noncounter claimant has agreed to pay 2% incentive to the defendants. Mere oral testimony of defendant cannot be accepted as a proof that there was an agreement between the plaintiff and defendants to pay the incentive particularly considering the fact that plaintiff has denied that there was any such agreement. Further from the fact that the defendants was paying the freight charges to the plaintiffs since its dealing with the plaintiff in the year 198384 and except allegedly once i.e. in year 1996 the incentive was never paid to the defendants. It looks very unlikely that for such a long period plaintiff was not paying the incentive but despite this defendants are continuing dealing with the plaintiff. Furthermore admittedly defendant has never raised any demand in writing with the plaintiff to adjust the 2% commission as agreed between them.
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 51 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
66. As far as contention of the Ld. Counsel for defendant that from ledger A/c of plaintiff it is prove plaintiff paid 1.5% incentive in the year 1996. First of all said account statement cannot be accepted in evidence being marked and not exhibited. Further on perusal of the same, I found that a credit of Rs.19,000/ has been given by the Skymates as incentive. First of all in that statement even if same is presume to be correct is not 2%. No explanation has been given by the defendants why 1.5 % incentives was accepted when 2% agreed. Further in the statement mark A it is mention that Rs. 19000/ was given as incentives whereas in account statement filed by the noncounter claimant i.e. Ex.P112, it is mention that the amount of Rs.19,000/ credited towards mishandling of shipment. Hence the reason of giving Rs.19,000/ in both statements filed by the plaintiff/ noncounter claimant and filed by defendant/ counter claimant are different. The a/c statement file by the defendant do not contain signature or stamp of plaintiff company. Even I found that plaintiff has file the account ledger of year 01.01.96 to 01.03.1996 on 02.07.2007 whereas defendant has file the same 09.03.2010. No explanation has been given by the defendant in the WS or DW1 in his testimony how defendant came into possession of said account ledger of plaintiff company.
67. On perusal of Mark A, I found that word" Being Cr. Note no.37 issued CS No.613559/16 & CS 619342/16 (Counter Claim) Page 52 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. T Hindustan Exports Towards incentives Comm. For the period 01.01.96 to 31.03.1996 on total business 1266639" appear to be typed/ written with different ink than the entire other portion of the said document as impression of the same is much darker than the other portion. Further on calculation of total amount in the said bill its comes to Rs. 1391419/ whereas commission was given on only 12,66,639/ mentioning its as total business for period 1.1.96 to 31.03.1996. Why commission on this amount has been given there is no explanation given by the defendant. The probable explanation in my view is that 1.5% of said amount is approx 19,000/. Thus said figure has been mention to give impression that 1.5 % commission has been given. Said statement has been file on 09 march 2009. There is no mention in the WS/Counter claim that Rs. 19,000/ was given by plaintiff as commission for the bills of year 1996. Hence this account statement file by the defendant appeared to be forged and account statement file by plaintiff for the said period EXP112 appear to genuine. No other statement of account /or document has been file that plaintive gave 2% incentive to the defendant despite the fact that defendant in WS has alleged that initially discount of 2% was given. In these circumstances I do not find testimony of DW1 reliable.
CS No.613559/16 & CS 619342/16 (Counter Claim) Page 53 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.
68. In view of above I held that defendant has failed to proved there was any agreement between the plaintiff and defendant whereby plaintiff company agreed that it will pay 2% incentive/discount to the defendant on the freight bill and thus the defendant/ counter claimant is not entitled to any amount towards incentive/ discount. Therefore Issue no.9 is decided against the defendant/ counter claimant. ISSUE NO.10 "Whether the defendant is entitled to any interest on the said amount? If so, its quantum and period? (OPD)"
AND ISSUE NO.11 "Whether the defendant is entitled for decree of rendition of accounts? If so, its effect? (OPD)"
69. In view of my findings of issue Nos. 8 and 9, I held that defendant/ counter claimant is not entitled to any amount. Since he is not entitled to any amount, he is not entitled to any interest and further he is not entitled for decree of rendition of account. Therefore both the issues are decided against the defendant/ counter claimants and in favour of the plaintiff/ noncounter claimant. CS No.613559/16 & CS 619342/16 (Counter Claim) Page 54 of 55 Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors. RELIEF
70. In view of my findings of issue no. 4 and 5, I pass a decree for recovery of a sum of Rs.19,49,748/ in favour of the plaintiff and against the defendant alongwith simple interest of 12% p.a. on the said amount from 13.06.2006 till date of filing suit. Further plaintiff is also held entitle to interest at the same rate i.e. 12% from the date of filing suit till its realization. Plaintiff is also entitle to proportionate costs.
71. As far as counter claim is concerned, in view of my findings of issue no. 7 to 11 I held that defendant is not entitle to any relief , the counter claim is hereby dismissed.
72. Deficient Court fees if any be paid by plaintiff and thereafter decree sheet be prepared accordingly. File be consigned to record room. Digitally signed by
SANJEEV SANJEEV KUMAR
KUMAR Date: 2019.01.24
13:15:49 +0000
Announced in the open
Court on 24.01.2019. (Sanjeev KumarI)
Additional District Judge12,
(Central), Tis Hazari Courts, Delhi.
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Skymates (India) Pvt. Ltd. Vs. M/s Hindustan Exports & Ors.