Delhi District Court
M/S Spark Electrodes Pvt Ltd vs Skanda Fastners Pvt Ltd on 18 November, 2025
IN THE COURT OF Ms. NIRJA BHATIA
DISTRICT JUDGE (COMM-07), DIGITAL
SOUTH-EAST DISTRICT, SAKET COURT, NEW DELHI
CS(COMM) 3633/2024
M/S. SPARK ELECTRODES PVT. LTD.,
G-55, MASJID MOTH,
GREATER KAILASH-II,
NEW DELHI-110048.
(Through its Director Sh. Sushil Kumar Goyal.)
.... Plaintiff
Versus
SKanda Fastners Pvt. Ltd.
Plot No. G-1/284, RIICO
Industrial Area Phase-3, Sector-7,
Khuskera Bhiwadi,
Rajasthan-301707
(Through its Director, Sh. Himanshu)
Also at:-
F-203 B,
RICO Industrial Area,
Khushkhera Bhiwadi,
Rajasthan-301707.
... Defendant
Date of Institution: 29.08.2024
Arguments concluded on : 04.10.2025
Date of Judgment: 18.11.2025
EXPARTE JUDGMENT
(1) By this judgment, I shall decide the present suit for NIRJA
BHATIA
recovery of Rs.6,16,716/-along with interest pendete lite and Digitally signed
by NIRJA BHATIA
Date: 2025.11.18
16:41:42 +0545
future interest.
Page no. 1/13
(2) Suit is filed by, M/s Spark Electrodes Pvt. Ltd., a private
limited company engaged in the business of supplying G.I. pipes
and steel structures having its registered office at G-55, Masjid
Moth, Greater Kailash-II, New Delhi - 110048. The suit has been
instituted through its Director, Sh. Sushil Kumar Goyal, who is
the authorized representative of the company by virtue of a
Board Resolution dated 29.08.2022.
(3) Suit is filed against, M/s Skanda Fasteners Pvt. Ltd., a
private limited company having its registered office at Plot No.
G-1/284, RIICO Industrial Area Phase-3, Sector-7, Khushkhera,
Bhiwadi, Rajasthan - 301707, and also located at F-203 B,
RIICO Industrial Area, Khushkhera, Bhiwadi, Rajasthan -
301707, through its Director, Sh. Himanshu.
(4) The facts summarized through plaint are,
(i) The Plaintiff claims that,in December 2014, the Defendant,
M/s Skanda Fasteners Pvt. Ltd., approached the Plaintiff at its
registered office in Delhi with a proposal to purchase G.I. pipes,
mild steel angles, stainless steel sheets, and other steel products.
The Defendant represented that it sought a long-term business
relationship and assured timely payments, including willingness
to make advance payments. Relying on these assurances, the
Plaintiff commenced business with the Defendant.
(ii) Plaintiff further claims that, on 23.12.2014, the Defendant
placed oral purchase orders, pursuant to which the Plaintiff
supplied goods as specified and raised corresponding invoices.
At no point did the Defendant raise any objection regarding the
quality, quantity, pricing, or delivery of the goods, nor were any
Digitally
supplies returned. Until the introduction of GST, the Defendant
signed by
NIRJA
NIRJA BHATIA
BHATIA Date:
2025.11.18
16:41:47
+0545
also issued Sales Tax 'C' Forms, thereby acknowledging receipt
and acceptance of the materials.
Page no. 2/13
(iii) Plaintiff claims that, the parties operated a mutual, open,
running, and current account, wherein the Defendant enjoyed 30
days' credit on each invoice. Despite this facility, the Defendant
made only irregular and delayed part-payments, totaling
₹24,02,215/-, through banking channels. Against total supplies
amounting to ₹30,18,931/-, an outstanding principal balance of
₹6,16,716/- remained unpaid. As per agreed terms, delayed
payments attracted interest @ 24% per annum, a condition the
Defendant never disputed during the course of dealings.
(iv) The last supply was made on 09.03.2018, after which the
Plaintiff discontinued further supplies due to the Defendant's
persistent defaults. The Defendant nevertheless continued
making sporadic part-payments up to 04.10.2021, which
constitutes the last acknowledged payment. Despite repeated oral
assurances, the Defendant failed to clear the outstanding dues.
(v) The Plaintiff issued a legal demand notice dated 17.06.2023,
served via speed post, WhatsApp, and email. The Defendant
neither responded to nor complied with the notice.
(vi) Subsequently, the Plaintiff initiated Pre-Institution Mediation
under Section 12A of the Commercial Courts Act before the
Mediation Centre, Saket Courts. During mediation proceedings,
the Defendant admitted its liability but expressed inability to
make a lump sum payment and sought concessions. No
settlement was reached, and mediation was declared "non-
starter/unsuccessful" on 07.06.2024.
(vii) Accordingly, the Plaintiff has instituted the present
NIRJA
commercial suit seeking recovery of ₹6,16,716/- (principal) BHATIA
Digitally signed
along with simple interest @ 24% per annum w.e.f. 05.10.2021
by NIRJA BHATIA
Date: 2025.11.18
16:41:52 +0545
until realization, on the ground that the Defendant has no tenable
Page no. 3/13
defence, the supplies and invoices stand admitted, and the
liability is acknowledged through documents, conduct, and part-
payments.
Note of Proceedings
(5) The present suit was filed on 29.08.2024 for recovery of
Rs. 6,16,716 along with pendente lite and future interest at 24%
per annum. The suit was accompanied by a statement of truth,
non-starter report, and court fees. The court issued summons to
the defendant through multiple modes including e-mail,
WhatsApp, ordinary process, registered AD-speed post, and
approved courier, returnable on 05.10.2024, directing the
defendant to file a written statement within the statutory period.
The matter was scheduled for 05.10.2024.
(6) On 18.01.2025, it was noted that summons issued through
ordinary post had not been returned, while those sent via speed
post to the first address were returned unserved, and those to the
second address were not received back. Although appearances
were recorded on 05.10.2024 and 23.11.2024 through video
conferencing by the defendant's counsel, the defendant had not
filed a vakalatnama or a written statement. The plaintiff was
directed to file tracking reports and an affidavit regarding
service. The matter was transferred pursuant to an order dated
28.02.2025, and it was observed that the defendant had
effectively been served prior to 05.10.2024, yet 171 days had
elapsed without filing a written statement. In view of the M/S
SCG Contracts India Pvt. Ltd. vs Ks Chamankar Infrastructure
NIRJA
Pvt. Ltd. on 12 February, 2019, the opportunity to file a written BHATIA
Digitally signed
by NIRJA BHATIA
Date: 2025.11.18
statement was closed. The matter was scheduled for the plaintiff's
16:41:57 +0545
Page no. 4/13
evidence on 09.04.2025, which was later adjourned to
28.04.2025.
(7) During the proceedings on 28.04.2025, PW-1, Sh. Shushil
Kumar, AR of the plaintiff, tendered his examination-in-chief by
affidavit. The defendant requested adjournment citing the
incapacity of their counsel due to medical reasons, but the court
observed that no medical certificate had been filed and warned
that the questionnaire for cross-examination should be submitted
in writing if counsel remained incapacitated. The matter was
adjourned for cross-examination on 19.05.2025. Subsequent
hearings on 03.07.2025 recorded the plaintiff's attendance but
noted irregular participation from the defendant, who appeared
late via VC with newly engaged counsel without filing a
vakalatnama or memo. The court observed that prior requests for
adjournment were only employed to delay proceedings, and the
cross-examination opportunity was closed. The matter was
posted for final arguments on 14.07.2025.
(8) The defendant filed an application under Section 151 CPC
seeking review and recall of the order dated 03.07.2025, arguing
that the closure of cross-examination was premature and
influenced by assumptions not aligned with the record, resulting
in prejudice. They claimed that prior adjournments had been
necessary due to the alleged incapacity of their counsel. The
court analyzed the application against the provisions of Section
114 CPC and Order 47 Rule 1 CPC , citing legal precedents that
review powers are limited to correction of errors apparent on the
face of the record and cannot be used as a substitute for appeal or
rehearing. After reviewing the defendant's conduct, the court NIRJA
BHATIA
noted repeated non-participation despite accommodation, lack of
Digitally signed
by NIRJA BHATIA
Date: 2025.11.18
16:42:02 +0545
Page no. 5/13
timely medical documentation, and failure to utilize prior
opportunities, concluding that the defendant's claims did not
reveal any error apparent on the record and were primarily
intended to delay proceedings. Consequently, the review
application was not entertained, and the matter proceeded toward
final arguments.
Evidence
(9) Evidence is received by way of affidavit. Statement of
PW-1 Sh. Sushil Kumar Goyal, by way of affidavit bearing my
signature at point 'A' and 'B' at last page. The same is now
exhibited as Ex. PW1/A.
1.Certificate of Incorporation and Board Resolution of the Plaintiff dated 03.06.2023 (colly) Ex. PW1/1 (colly)
2. Retail Sale Invoices-cum-Challans for the period 24.12.2014 to 09.03.2018 along with respective Delivery Challans (colly) Ex. PW1/2 (colly)
3. Sales Tax Form 'C' issued by the Defendant to the Plaintiff (colly) Ex. PW1/3 (colly)
4. True certified copy of Ledger Account maintained by the Plaintiff in the name of the Defendant for the period 23.12.2014 to 04.10.2021 & up to date Ex. PW1/4.
5. Legal Demand Notice dated 17.06.2023 issued by the Plaintiff to the Defendant, along with original postal receipts dated 01.07.2023 and WhatsApp & Email service proofs dated 30.06.2023 (colly) Ex. PW1/5 (colly)
6. Original copy of Closure Report dated 07.06.2024 issued by NIRJA DLSA, South-East, Saket Courts, in the Pre-Litigation Mediation BHATIA Digitally signed Case Ex. PW1/6 by NIRJA BHATIA Date: 2025.11.18 16:42:07 +0545 Page no. 6/13
7. Certificate of the Plaintiff under Section 63 of the Sakshya Adhiniyam, 2023 read with Order XXI Rule 6(3) CPC (as amended) Ex. PW1/7.
(10) As defendant remained Ex parte, at the instance of the plaintiff, PE was closed. Sh. Jatin Dua, Ld. Counsel for the plaintiff made his submissions.
I have heard the submissions and have perused the record.
Findings (11) The Court has carefully considered the pleadings, documents placed on record, and the testimony of PW-1, Sh. Sushil Kumar Goyal, Director-cum-Authorised Representative of the plaintiff company, who appeared and tendered his affidavit of evidence as Ex. PW1/A. (12) The plaintiff asserts that the account maintained with the defendant is a mutual, running, open, and current account, reflecting continuous transactions between the parties. According to the plaintiff, successive invoices were issued and payments were received and credited in the ledger, with the balance struck periodically. The plaintiff contends that the account remained unsettled, and all payments made by the defendant were adjusted against the aggregate dues, thereby constituting an ongoing, open, and current account that records reciprocal obligations and outstanding balances in a continuous manner.
I. Nature of Account - Running and Non-Mutual (13) The evidence (Ex.PW1/2 and PW1/4) demonstrates a NIRJA BHATIA running and non-mutual account: successive invoices were Digitally signed by NIRJA BHATIA Date: 2025.11.18 16:42:11 +0545 issued, payments received and credited, and balances struck Page no. 7/13 continuously. Reliance can be placed upon Bharath Skins Corporation vs Taneja Skins Company Pvt. Ltd. on 21 December, 2011, it is recognized that continuous transactions create one subsisting cause of action, and recovery is based on the balance due rather than individual invoices.
21. In this regards, it is important to note the following observations made in the decision reported as Dood v. Wigley (1849) 7 C. 3. 106 when it was observed:-
"Where goods are ordered of a tradesman on the 1st of January and distinct orders for other goods are given on the 2nd, 3rd, 4th, 5th, etc., if from the previous dealings between the parties, or from general usage, or otherwise, it is to be inferred that it was contemplated by the parties, that, in the event of the dealing continuing, the several items should be included in the monthly, quarterly, or yearly bills, the result of such an arrangement, and the legal position of the parties, seems to be this,- upon the delivery and acceptance of the first parcel of goods, delivered on the 1st of January, an entire contract is created, and a complete cause of action accrues, the tradesman, being) under no engagement to sell other goods, or to give credit beyond the price of the articles then delivered : when, on a subsequent day, other goods are delivered and accepted, a new contract arises, not simply a contract to pay for the goods then delivered, but a new entire contract by which the tradesman waives his existing right to payment off the goods delivered on the 1st of January, and the purchaser agrees to pay for both parcels as upon one entire sale... After the successive waiver and extinguishment of each preceding NIRJA contract, the only subsisting contract BHATIA and cause of action ex contractu will be Digitally signed by NIRJA BHATIA the last." Date: 2025.11.18 16:42:15 +0545
22. Reliance can also be placed upon, the observations in the decision reported as Page no. 8/13 (1856) 18 C.B. 325 Bonsey v Woodsworth are also worthy of being noted; and are as under:-
"where a tradesman has a bill against a party for any amount, in which the items are so connected together that it appears that the dealing is not intended to terminate with one contract, but to be continuous, so that one item, if not paid, shall be united with another, and form one continuous demand, the whole together forms but one cause of action and cannot be divided."
(14) In Modern Construction Company Delhi vs Hitech Enterprises on 24 August, 2023, Delhi High Court establishes that in a running account, payments are applied chronologically, and the balance due is recoverable even if multiple invoices are involved. Similarly, in Bharath Skins Corporation vs Taneja Skins Company Pvt. Ltd. on 21 December, 2011, it was observed that in a running and non-mutual account, the balance at the foot of the account represents the amount due, and individual items cannot bar recovery.
II. Mutual vs. Non-Mutual Accounts (15) The law on mutual accounts is well-settled that mutual accounts require reciprocal obligations on both sides. Reliance can be placed upon, Modern Construction Company Delhi vs Hitech Enterprises on 24 August, 2023,
24. Blacks Law Dictionary defines a "running account" as an open unsettled account, as distinguished from a stated and liquidated account. Running accounts mean „mutual NIRJA accounts‟ and „reciprocal demands‟ between the BHATIA Digitally signed parties, which accounts and demands remain open by NIRJA BHATIA Date: 2025.11.18 16:42:19 +0545 and unsettled.
Page no. 9/1325. The characteristics of a „mutual account‟ were stated in the case of Hirada Basappa vs Gadigi Mudappa (1871) VI MHCR 142 thus:
"To be mutual there must be transactions on each side creating independent obligations on the other, and not merely transactions which create obligations on the one side, those on the other being merely complete or partial discharges of such obligations."
26. Further, in the case of Tea Financing Syndicate Ltd. vs Chandrakamal Bezbaruah (1930) 2nd 58 Calcutta 649 it was observed that the requirement of „reciprocal demands‟ involves transactions on each side which creates independent obligations on the other.
27. The case of Tea Financing Syndicate (supra) has been referred by the Apex Court in the case of Hindustan Forest Co. v. Lal Chand and Ors. 1960 SCR (1) 563 and Kesharichand Jaisukhlal v. Shillong Banking Corporation Ltd. 1965 SCR (3) 110 wherein similar observations were made.
28. Thus, the law on what constitutes a „mutual account‟ is well settled and it implies reciprocal and mutual obligations which keep getting adjusted against each other on receiving the payments from either party.
29. The term "running and non-mutual account"
on the other hand, has been explained in the case of Ranganathan vs. Sarwana Store 2018 SCC OnLine Madras 5897 that in case of a "running and non mutual account"
between the buyer and seller, when goods are delivered by the seller to the buyer, the value of the goods is debited in the debit column and when amounts are paid by the buyer to the seller, they are entered in the credit column. The difference is continuously struck in the column for balance. In such a case, when the buyer defaults to make balance payment, the seller's action is not for the price of goods sold and delivered, but for the balance due at the foot of an account. The account is running as the amounts received from time to time are credited and the amounts still due is NIRJA reflected as debit. Essentially, it is "non mutual" BHATIA Digitally signed because the amounts being adjusted are those by NIRJA BHATIA Date: 2025.11.18 payable by one party. Its contradistinction, 16:42:23 +0545 "Mutual account" implies that the credit - debit account is of both the parties.
Page no. 10/13(16) Sections 59 to 61 of the Indian Contracts Act, 1872 govern the appropriation of payments. Section 59 provides that when a debtor owes several distinct debts to a creditor, any payment made must be applied to the particular debt indicated by the debtor. Section 60 provides that if the debtor does not specify which debt the payment is meant to discharge, the creditor has the discretion to apply the payment to any lawful debt that is due, whether or not it is barred by limitation. Section 61 provides that if neither the debtor nor the creditor makes any appropriation, the payment shall be applied in discharge of the debts in chronological order, i.e., starting with the earliest debt first, Ref: Modern Construction (Supra) support the application of these sections, the plaintiff applied payments chronologically, and the balance due reflects all outstanding invoices.(Ex. PW1/4), III. Accrual of Right to Sue (17) The right to sue arises upon default after demand, and where part-payments are made, such payments constitute an acknowledgment of liability and effectively reset the limitation period under Section 19 of the Limitation Act. In the present case, the last part-payment made by the defendant was on 04.10.2021 (Ex.PW1/4), which acknowledges the outstanding liability. Consequently, the suit filed is within the prescribed limitation period. Furthermore, as clarified by Hon'ble Delhi High Court in Bharath Skins Corporation vs Taneja Skins Company Pvt. Ltd. on 21 December, 2011, that, running non-
NIRJA mutual accounts fall under Article 113, which prescribes a three- BHATIA Digitally signed by NIRJA BHATIA year limitation, thereby reinforcing the claim's maintainability. Date: 2025.11.18 16:42:28 +0545 Relief Page no. 11/13 (18) The defendant has neither disputed the receipt of goods supplied by the plaintiff nor challenged the issuance of C-Forms, which form part of the statutory compliance evidencing the sale transactions. The ledger entries maintained by the plaintiff, which have been produced as Ex.PW1/4, clearly reflect the payments made by the defendant from time to time and the corresponding balances outstanding. These entries are consistent with the documentary evidence of invoices raised by the plaintiff and acknowledged by the defendant through part-payments. Furthermore, the defendant did not respond to the legal notice issued by the plaintiff, which demanded payment of the outstanding amounts. It is also notable that no cross-examination of PW-1, the plaintiff's authorized representative who deposed on the account details and payments, was conducted, leaving the plaintiff's evidence unchallenged and uncontroverted. On a careful examination of the documentary evidence and oral testimony, and applying the standard of preponderance of probabilities, it is clear that the principal sum of ₹6,16,716/- remains due and payable by the defendant.
Interest (19) The plaintiff has claimed interest at the rate of 24% per annum; however, such a rate is clearly excessive and cannot be enforced, as there is no written agreement between the parties to substantiate this high rate. In terms of legal provision, Section 34 of the Code of Civil Procedure, 1908 empowers the Court to award interest in commercial transactions, but the rate must be reasonable and shall not exceed the prevailing bank rate. NIRJA BHATIA Considering the continuous dealings between the parties, the Digitally signed by NIRJA BHATIA Date:
2025.11.18 16:42:32 +0545 defaults by the defendant, and the absence of any contrary Page no. 12/13 evidence, the Court is satisfied that a reasonable interest rate of 9% per annum is appropriate. This interest is to run pendente lite and until actual realization of the principal sum, thereby compensating the plaintiff for the delayed payment.
(20) Accordingly, the suit is decreed in favour of plaintiff for outstanding principal sum of ₹6,16,716/-, together with simple interest at 9% per annum pendente lite and until realization, along with court fees of ₹8,364 and counsel fees of ₹10,000 in the absence of a certificate.
(21) Decree sheet be drawn. File be consigned to Record Room after completion of necessary formalities.Digitally signed by NIRJA
NIRJA BHATIA BHATIA Date:
2025.11.18 16:42:55 +0545 Announced in open Court (Nirja Bhatia) today on 18th November 2025 District Judge (Comm. Court) (Digital-07) South-East, Saket Court, New Delhi Page no. 13/13