Delhi District Court
M/S Easy Trip Planners Pvt Ltd vs M/S The Times Creations And Anr on 26 September, 2024
IN THE COURT OF MS. KIRAN BANSAL
DISTRICT JUDGE
COMMERCIAL COURT-02, SHAHDARA,
KARKARDOOMA COURTS, DELHI
CS (Comm) No. 420/2020
M/s. Easy Trip Planners Ltd.
Through its Authorized Representative
Sh. Naresh Kumar (AR)
223, 1st & 2nd Floor, F.I.E,
Patparganj Industrial Area,
New Delhi-110092 .... Plaintiff
Versus
1. M/s. Times Creations
Registered Office at:
7 Govindarao Street,
Near Sheshadripuram Law College,
Bangalore - 560020 .... Defendant no.1
2. Mr. Harish MS
O/o 7 Govindarao Street,
Near Sheshadripuram Law College,
Bangalore - 560020 .... Defendant no.2
Date of institution of the case : 03.09.2020
Date of final arguments : 07.08.2024
Date of judgment : 26.09.2024
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 1 of 45
JUDGMENT
1. This is a civil suit (commercial) for recovery of the amount of Rs. 17,42,500/- (i.e. Rs.13,42,500/- as principal and Rs.1,50,000/- towards travel and stay of staff of plaintiff company and further Rs.2,50,000/- as compensation for breach of MOU) along with pre suit interest @ 24% per annum from the due date till its realization filed by M/s. Easy Trip Planners Ltd. through its Authorized Representative Sh. Naresh Kumar against Sh. Harish MS Proprietor of M/s. The Times Creations (TTC). It is pertinent to mention that in the plaint, total amount mentioned is Rs.17,42,500/- and Rs.13,42,500/- as principal, but, on seeking clarifications by the court on 15.07.2024, counsel for plaintiff on 15.07.2024 had stated that the same was a typing mistake and the amount paid by plaintiff to defendant was Rs.13,12,500/- and not Rs.13,42,500/- and thus, the total amount claimed was Rs.17,12,500/- and not Rs.17,42,500/-.
1.1 It is stated that plaintiff through an approval of Central Government having been accorded to Easy Trip Planners Private Limited vide SRN H57503369, dated 11.05.2019 has been converted into a Public Limited Company. Plaintiff Company vide its Board Resolution dated 28.05.2019 authorized Sh. Naresh Kumar as its authorized representative to appear before this court on its behalf . It is stated that Plaintiff Company is inter-alia engaged in the business of providing ticket booking facility for domestic and international air travel, railway reservation, ticketing, hotel bookings, travel Insurance, tours, holiday packages as well as other travel and hospitality goods and services to various travel agents as well as individuals. It is further submitted that the Plaintiff Company enjoys high reputation in the travel CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 2 of 45 industry.
1.2 It is stated that defendant No.1 is a firm run by defendant No.2 having its registered office at 7 Govindarao Street, Near Sheshadripuram Law College, Bangalore-560020 and it is submitted that defendant is an advertising agency, engaged in the business of event management, advertising and media planning for a number of events across Bangalore and defendant No.2 on behalf of Defendant No.1 planned to organize an event which was supposed to be held in Bangalore on 03.11.2018 under the name and style of "FUSIONIGHT" at the White Orchid Convention Centre, Manayata Tech Park, Nagavara, Bengaluru, Karnataka-560045 whereby special appearance and performances of celebrities like Sunny Leone and Mr. Raghu Dixit was also scheduled by the defendants.
1.3 It is stated that with the purpose of carrying out the event successfully, the defendant's had approached various sponsors across India and the Plaintiff Company was one among them and after seeing brochure of the event, the officials of Plaintiff Company showed their interest as being an "Official Title Sponsor" in the aforesaid event and further inquired about the terms and conditions for the same. The defendants after seeing the interest of plaintiff company met the officials of the plaintiff wherein the defendants explained the nitty-gritty's of above mentioned event as they needed financial support. It is further stated that the defendant disclosed the schedule of sponsorship fees alongwith deliverables to the plaintiff and further assured that all the terms and deliverables such as bouncers and security, TV and radio ads etc. will be met without any default.
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 3 of 45 1.4 It is stated that after going through the terms and conditions as explained by the defendants, the Plaintiff decided to enter in a Memorandum of Understanding (hereinafter to be referred to as MOU) with the defendant in order to sponsor the aforesaid event as "Official Title Sponser", consequently, a MOU dated 18.10.2018 was executed between the Plaintiff and the Defendants in Delhi at Plaintiff's office, and additionally, certain other deliverables were also promised to the Plaintiff alongside the MOU in respect of the said event. It is significant to mention that as per MOU dated 18.10.2018, the plaintiff agreed to pay a sum of Rs,15,00,000/- plus 18% GST towards the sponsorship fee and the aforesaid amount was to be disbursed in three (3) installments as enumerated hereunder:
a) First Installment of Rs.7,50,000/- + GST at the time of signing the MOU;
b) Second Installment of Rs.3,75,000/- + GST on or before 30.10.2018.
c) Third Installment of Rs3,75,000/- + GST on or before 05.11.2018.
1.5 That the Plaintiff acted upon the terms and conditions of MOU dated 18.10.2018 made the payment towards the first installment for an amount of Rs.8,85,000/- on 20.10.2018, thereafter, made the payment towards second installment on 31.10.2018 for an amount of Rs.4,27,500/-. It is submitted that plaintiff had made a total payment of Rs.13,12,500/- to the defendant. It is stated that defendant assured plaintiff that all agreed deliverables would be met without any hindrances with respect to said event, however, after receiving the payment of two installments, the defendant started to ignore the calls and further never shared the floor plans of the said event with the plaintiff.
1.6 It is stated that on 02.11.2018, a day before event, officials of CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 4 of 45 plaintiff reached the venue in order to check the preparations/arrangements of event, but, to utter dismay of plaintiff company, the said officials found many discrepancies in arrangements at the venue and defendants also failed to provide deliverables as per terms and conditions of MOU. It is stated that on the date of the event i.e. 03.11.2018, the officials of plaintiff reached the venue for the said event and on reaching the venue, the officials of plaintiff company were distraught to find various facilities which were agreed between the defendant and the plaintiff such as Exclusive Boards, Hoardings, Impressions, Seat and washroom for the customers of Plaintiff, Food and drinks, Facilitation of Director, Parking lot etc. which the plaintiff company being official sponsor of said event was promised, were not provided and arranged by the defendant. It is stated that defendant failed to comply with more than half of deliverables as agreed between the plaintiff and the defendant and also failed to abide by the terms and conditions of the agreement.
1.7 It is stated that thereafter, the plaintiff contacted the defendant No.2 on several occasions, but, the defendant No.2. gave lame excuses on one pretext or other for not abiding the agreed terms and conditions and the lapses on the part of defendants caused great damage to plaintiff both financially as well as degraded the brand name of plaintiff company as various customers, thereafter, complained and gave a negative feedback of the aforesaid event thereby causing wrongful loss to plaintiff company.
1.8 It is stated that thereafter, in view of non-compliance of MOU by the defendants, the plaintiff company served legal notice dated 08.12.2018 upon the defendants. It is stated that the cause of action arose when defendants CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 5 of 45 approached the plaintiff in Delhi for the sponsorship in the event under the name and style of "FUSIONIGHT" to be held in Bangalore. It further arose when MOU dated 18.10.2018 was executed in Delhi between the plaintiff and the defendants. It further arose when plaintiff made payment of first installment for amount of Rs.8,85,000/- on 20.10.2018 and it further arose when plaintiff made the payment of second installment for an amount of Rs.4,27,500/- on 31.10.2018 and it further arose on 02.11.2018 when officials of plaintiff reached the venue but defendant failed to provide deliverables as per the terms and condition of MOU. It further arose on 03.11.2018, when officials of the plaintiff reached the venue for the event, but, defendants failed to act as per MOU. It further arose when plaintiff contacted the defendants on several occasions but the defendants gave lame excuses and was of no avail and the cause of action subsists and is continuous till the amount due to the plaintiff is paid by the defendants. It is stated that the suit for the purposes of jurisdiction of this Court is valued at Rs. 17,42,500/- and the necessary court fee of Rs.19,376/- has been duly affixed on the plaint and has been paid by the plaintiff.
1.9 It is stated that the instant matter was put for DLSA Mediation, but, in spite of the service of notice to defendants, the matter is termed "non-starter"
vide order dated 23.12.2019. It is stated that the instant dispute is "commercial dispute" as defined under section 2 (1) (c) of the Commercial Courts Act, 2015 and that the suit for the purpose of jurisdiction of this Hon'ble court is valued at Rs.17,42,500/- and necessary court fee has been duly affixed on the plaint and has been paid by the plaintiff. It is stated that the present suit has been filed within the provisions of law and also within the territorial jurisdiction of this court in the light of MOU dated 18.10.2018 whereby in the event of any dispute CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 6 of 45 in connection with the aforesaid agreement, the courts of Delhi have the exclusive jurisdiction to adjudicate the same.
2. Summons of the suit were issued to defendant for settlement of issues on 09.09.2020 and the defendants have put their appearance through their counsel on 18.03.2021 and WS has been filed on behalf of defendant wherein it is stated that the parties had officially entered into the contract on 18 October 2018 and event was scheduled for 03rd November 2018 and the Agreement was executed merely 15 days before the said event. Defendant submits that technically, it takes atleast a month to 45 days to reach 4 Million impressions/views in Google search engine (paying more money also, the search engine (SEO) takes its own time to reach views) and defendants had tried their level best to reach 1 Million views in the given time by the plaintiff.
2.1 It is stated that suit is bad due to non-joinder of proper and necessary parties as plaintiff had not impleaded Sunny Leone and Raghu Dixit as a party to the present case. It is stated that present suit is preferred by plaintiff merely because the photo session with celebrity namely Sunny Leone & Raghu Dixit could not be possible due to security reasons from the Karnataka Police department as that was the huge event of Karnataka and the security reason had caused frustration of contract. It is stated that many times unforeseen or unforeseeable supervening events occur which make the performance of the contracts impossible due to no fault of either party and in such cases, the contract is said to be frustrated. It is stated that frustration of contract results in involuntary extinction of the contractual obligations of both parties and consequently, the parties are relieved from their rights and liabilities. It is CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 7 of 45 further stated that the present suit for recovery is without any cause of action and subject matter and the plaintiff has approached this court with unclean hands and ulterior motives best known to themselves. It is further stated that no payments were received at Delhi and most importantly the event name and style as Fusion Night took place in Karnataka not in Delhi and that the defendants had not visited the Delhi office of the plaintiff for entering into the said Memorandum of Understanding. Defendant has stated that all discussion regarding the MOU had taken place on phone and emails and defendants had not visited the office of the plaintiff at Delhi, therefore, no part of the cause of action arose in Delhi and thus, territorial jurisdiction of this court is not made out.
2.2 It is stated that plaintiff has wrongly made the pecuniary Jurisdiction of this Court on valuation of Rs.17,42,500/- because plaintiff has paid only partial amount as per the terms of the MOU i.e. 13,12,500/- and that this suit needs to be dismissed on this ground also. It is further stated that the plaintiff had not placed any authentic documentary evidence which would substantiate their frivolous and baseless claims.
2.3 It is stated that the total deal amount was Rs.15,00,000/- plus 18% GST and the plaintiff had only paid two installments i.e. Rs.7,50,000/- and second is of Rs. 3,75,000/- with 18% GST and that the plaintiff has violated the terms of MOU and has not paid third/last payment of Rs.3,75,000/- alongwith 18% GST to the defendants. It is further stated that after making payment of two installments, the plaintiff did not paid the remaining payment of Rs.3,75,000/- as per the said MOU, rather plaintiff has not contacted the defendant. Defendant has denied that they had never shared the floor plans of the said event with the CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 8 of 45 plaintiff and stated that plaintiff has not performed the payment terms of the said MOU.
2.4 Defendant denied that a day before the event there were discrepancies in the preparation/arrangements made by the defendants at the venue and further denied that the defendants failed to provide deliverables as per the terms of the MOU. It is stated that defendants had performed all terms of the said MOU except conditions which were impossible to perform. Defendants denied that on 03.11.2018, they have not provided agreed facilities such as Exclusive Boards, hoardings, impressions seat and washroom as per MOU and stated that the defendant, executed the hoardings co-promoting Ease My Trip- Fusion light, promoted the plaintiff on TV/Radio alongwith the key announcements on Radio. It is stated that the co-promoting Sponsors b/n in Google, Instagram & Facebook were reached around 1 million and as per the terms and conditions, 2000 VIP passes were given to plaintiff. It is stated that the defendants provided separate VIP Gallery and round table seating for 20-25 guest of the plaintiff and merely the photo session with Sunny Leone and Raghu Dixit could not be possible due to security directions from the police dерartment as it was a controversial event of 2018 and it is submitted that defendants provided the space for 10 standees of plaintiff and there was centre stage back drop LED branding of plaintiff. It is further submitted that the telecast of the EMT promos was also shown in the break as well. It is submitted that defendant has delivered/fulfilled all the conditions between the defendant and Plaintiff except two conditions inclusive of Photo Session with the Sunny Leone and Raghu Dixit as that condition has become impossible to perform was due to the safety/security reasons only. Defendant has stated that other condition of CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 9 of 45 achieving 4-5 million views was not achieved due to the lapse of the plaintiff as they executed the agreement 15 days prior to the said event and it takes around 45 days to reach viewership of 4-5 million views on search engines and therefore, defendants had performed all terms of the said MOU except conditions which were impossible to perform.
2.5 Defendants denied that they had given lame excuses for not abiding the terms of the MOU and had damaged the image of the plaintiff both financially as well as degraded the brand name of the plaintiff company. It is further denied that the various customers had given negative feedback of the aforesaid event. Remaining averments of the plaint are denied by the defendants and prayer for dismissal of the suit has been made with a direction to the plaintiff to remit/pay final payment of Rs.3,75,000/- to the defendants as per terms of the agreement.
3. Replication to the WS has been filed wherein the contents of the plaint are reiterated and the contents of the WS are denied.
4. During admission and denial of documents, the defendant in his affidavit of admission/denial of documents has admitted following documents of plaintiff.
(i) Email dt. 09.10.18 as mentioned at serial no. 5 of the list of documents of plaintiff which as Ex.P1 (page 21-22) colly;
(ii) Email dt. 11.10.18 as mentioned at serial no. 6 of the list of documents of plaintiff as Ex.P2 (page 23-25) colly;
(iii) Email dt. 18.10.18 as mentioned at serial no. 7 of the list of documents of CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 10 of 45 plaintiff as Ex.P3 (page 26-29) colly;
(iv) Email dt. 30.10.18 as mentioned at serial no. 8 of the list of documents of plaintiff as Ex.P4 (page 30-31) colly;
(v) MOU dt. 18.10.18 as mentioned at serial no. 9 of the list of documents of plaintiff which as Ex.P5 (page 32-33) colly.
However, the correctness of contents, existence and execution of the remaining documents is denied. On the other hand, plaintiff has denied all the documents relied upon by the plaintiff being a 3rd party documents. Vide same order, on the basis of pleadings of the parties, following issues were settled for consideration:
i. Whether it was a sole responsibility of organizer i.e. the defendant to promote between 4-5 million impressions as claimed by plaintiff? OPP.
ii. Whether it was impossible to perform the contract in totality as per Doctrine of Force Majeure? OPD.
iii. Whether substantial part of contract has been performed by defendant?
If so, its effect. OPD.
iv. Whether the plaintiff is entitled for money decree? If so, to what amount?
OPP.
v. Whether the plaintiff is entitled for any interest? If so, at what rate and
for which period. OPP
vi. Relief.
5. In support of its case, plaintiff has examined Sh. Saurabh Ahuja, AR of Easy Trip Planners Limited as PW-1 who tendered his evidence by way of affidavit which is Ex.PW1/A and has relied upon the following documents:
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 11 of 45 Incorporation certificate of plaintiff which as Ex.PW1/1. Board Resolution dated 15.02.2023 which as Ex.PW1/2 (OSR). Email dated 09.10.2018 which as Ex.PW1/3 (also Ex.P1). Email dated 11.10.2018 and 18.10.2018 as Ex.PW1/4(Colly) (also Ex.P2 and Ex.P3).
Original MOU dated 18.10.2018 which as Ex.PW1/5 (also Ex.P5).
Ledger Account which as Ex.PW1/6. Email dated 30.10.2018 which as Ex.PW1/7 (also Ex.P4). Legal notice dated 08.12.2018 as Ex.PW1/8. Postal receipt dated 11.12.2018 as Ex.PW1/9. Delivery reports which as Ex.PW1/10. Non-Starter report dated 23.12.2019 as Ex.PW1/11. Affidavit under Order XI Rule 6(3) of the Commercial Courts,
Commercial Division and Commercial Appellate Division of High Court, 2015 as Ex.PW1/12.
This witness was duly cross examined on behalf of defendant. Thereafter, PE was closed on the statement of plaintiff.
6. In rebuttal, defendant has examined Sh. Harish M.S., Proprietor of M/s. Times Creations as DW-1 who tendered his evidence by way of affidavit Ex.DW1/A and has relied upon the some documents in examination in chief on 23.05.2023, however, the chief examination could not be concluded and matter was adjourned for further chief examination as the defendant's witness has not brought all the original documents with him. Thereafter, the defendant's witness never turned for completing his chief examination and for cross examination CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 12 of 45 and, therefore, this part chief of the defendant's witness recorded on 23.05.2023 cannot be read for disposal of the case and the same is discarded. DE was closed accordingly vide order dated 01.04.2024 and matter was proceeded for final arguments.
7. It is also pertinent to mention that the defendant herein had also filed a counter claim for recovery of the remaining amount of Rs.3,75,000/- + GST (third installment as per MOU) which was registered separately. However, as none was appeared on behalf of the defendant (i.e. plaintiff in the counter claim), the said case / counter claim was dismissed in default and for non prosecution vide order dated 08.04.2024.
8. Ld. Counsel for plaintiff has relied upon the following judgments:
(i) Mahanagar Telephone Nigam Ltd. Vs. Tata Communications Ltd., Civil Appeal No. 1766 of 2019;
(ii) Construction and Design Services Vs. Delhi Development Authority, (2015) 14 Supreme Court Cases 263;
(iii) Indian Oil Corporation Vs. Lloyds Steel Industries Ltd., 2007 SC Online Del 1169;
(iv) Electronic Enterprises Vs. Union of India, 1999 SCC Online Del 731;
(v) Thakral and Sons Vs. Indian Petro Chemicals Corporation Ltd. & Ors., 1993 SC Online Del 141;
(vi) Roofrite Pvt. Ltd. Vs. Union of India & Ors., 1983 SCC Online Del 288;
(vii) Ghansiram Vs. Municipal Board, Bhopal, 1956 SCC Online MP 132;
(viii) Kishan Lal Kalra Vs. NDMC, 2001 SCC Online Del 411;
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 13 of 45
9. The court has heard ld. counsel for the plaintiff as none has appeared on behalf of defendant to advance arguments. Thereafter, defendant was given liberty to advance arguments or to file written submissions. However, neither counsel for defendant appeared to address arguments nor any written submissions have been filed on behalf of defendant. The court has also perused the record and the evidence of the case as well as the case laws / judgments relied upon by ld. counsel for plaintiff. The findings on the issues are as under:
ISSUE No. (i) : Whether it was a sole responsibility of organizer i.e. the defendant to promote between 4-5 million impressions as claimed by plaintiff? OPP.
10. The onus of proving this issue was upon the plaintiff. As per WS of the defendant, as the agreement was executed only 15 days prior to the event and it takes atleast a month to 45 days to reach 4 Million impressions/views in Google search engine, the defendants had tried their level best to reach 1 million views in the given time. The terms and conditions of the MOU dt. 18.10.18 (Ex.P5 and Ex.PW1/5), which is an admitted document, being relevant are reproduced hereinbelow:
"BENEFITS & DELIVERABLE The Organiser will ensure to exclusively position EASEMYTRIP (LOGO) as OFFICIAL TITLE SPONSOR across all Event Communication;
EASEMYTRIP will be provided with Stage Space for Branding Cutouts/ Backdrops (All branding creative/production to be provided by the CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 14 of 45 sponsor);
THE ORGANISER will publicize 2 (two) Customized Hoardings co-
promoting EASEMYTRIP & FUSIONIGHT Outside BBMP Limits; THE ORGANISER will co-promote THE SPONSOR in all their Television & Radio Branding as Official Title Sponsor; Key Radio Announcements to handout Contest Tickets to Radio Responders on behalf of EaseMyTrip & RED FM;
THE ORGANISER will co-promote THE SPONSOR through between 4- 5 million Impressions Co-branded Event Promotions on Digital Platforms like Facebook, Instagram, Google Adwords. Push Notifications, SMS & What's App Messages etc.;
THE ORGANISER will provide THE SPONSOR with 2,000 VIP Guest Passes to invite their Clients/Employees/Partners;
THE ORGANISER will also accommodate these VIP Guests in an exclusive VIP Gallery branded only for EASEMYTRIP with partial seating arranged for about 800 to 1000 VIP Guests in a Theatre Style Seating;
THE ORGANISER will further provide Roundtable Seating Arrangement for Family Audience accommodating 20 to 25 guests.
Photo Session will be arranged with SUNNYLEONE & RAGHUDIXIT along with EASEMYTRIP EXECUTIVES & FANS;
THE ORGANISER will be provide space for THE SPONSOR to display 10 (6 x 3) Standees;
EASEMYTRIP logo will be branded on centre-stage backdrop LED Screen (Digital Scroll);
THE ORGANISER to telecast THE SPONSOR Promo Videos during CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 15 of 45 breaks/pre-event Terms to Agreement The event "Fusionight" is exclusively promoted by The Time Creations (TTC) Bangalore and TTC will hold all rights to the event Fusionight, Arts, Content, Theme, Flow, Fabrication of the Stage and the entire know how of the Event;
The Time Creations will act directly as a booking agent for the sponsorship. We do not have any other booking agents. All sponsorship slots are sold on first cum first serve basis (subject to final availability); EASYMYTRIP should share the final number of VIP'S ATTENDING 2 days prior to the event;
SPONSORSHIP FEE to be paid in Advance within 3 working days from the date of confirmation;
TTC will share Post Edited Even Related 'Video & Photographs' with the sponsors and partners;
TTC will take all the security measures to ensure total safety at the venue; TTC will take necessary approvals on the creative from the sponsor before initiating even advertising/promotional activity such as "Hoardings, Theatre/Mall Branding, Posters etc.";
The Time Creation solely owns the right to postpone or cancel the even in such necessary measurements shall be taken on refund or change of schedule;
In the event of a 'force majeure" event occurring, parties may choose to agree that the party in breach should be given further time to perform its obligations under the sponsorship agreement. If this is the case, parties should think carefully about how long this period should be for. If the CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 16 of 45 party in breach is still unable to perform its obligations by the end of the extension, should the other party be entitled to terminate the agreement or renegotiate its terms;
The courts of Delhi will have exclusive jurisdiction to adjudicate any dispute arising under or in connection with this agreement."
11. As per the above terms and conditions, the organizer i.e. The Times Creation (TTC) was to co promote the Sponsor i.e. M/s. Easy MyTrip Planners Ltd. in all the television and radio branding and 4 - 5 million Impressions Co- branded Event Promotions on Digital Platforms like Facebook, Instagram, Google Adwords. Push Notifications, SMS & What's App Messages etc. The word used in the contract/MOU dated 18.10.2018 is co-promote and not promote. As the Organizer was to co-promote the Sponsor, it cannot be said that it was the sole responsibility of the organizer (TTC) to promote between 4 - 5 million impressions on the digital platforms. As the terms of the contract which is an admitted document between the party are clear in this respect wherein it has been mentioned that the Organizer will co-promote the Sponsor in all their television and radio branding as well as promotions on the digital platform, it cannot be said that it was the sole responsibility of the Organizer to promote between 4 - 5 million impressions.
Issue no. (i) is thus, decided in favour of the defendant and against the plaintiff.
ISSUE No. (ii) Whether it was impossible to perform the contract in totality as per Doctrine of Force Majeure? OPD.
12. The onus of proving this issue was upon the defendant. As already CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 17 of 45 observed that defendants have not led any evidence and have practically failed to discharge the onus placed upon them. The doctrine of force majeure is a legal concept that excuses a party from fulfilling their obligations in a contract if an event beyond their control makes it impossible to do so. The term "force majeure" literally means "superior force" and comes from French civil law.
13. "Force majeure" is the situation-based doctrine under which a supervening event may excuse liability for non-performance, provided the supervening event is unforeseeable, uncontrollable, and makes the performance of an obligation impossible - thus qualifying as a "force majeure event".
14. Force Majeure' is defined by Black's Law Dictionary as an event or effect that can be neither anticipated nor controlled. As per the dictionary, the term includes both acts of nature (e.g. floods and hurricanes) and acts of people (e.g. riots, strikes and wars).
15. This doctrine was also discussed by the Hon'ble Delhi High Court in Sarawjeet Singh & Anr. vs Asian Hotels North Ltd, CS(COMM) 346/2023 and I.A. Nos. 10319-23/2023, decided on 19 July, 2023, the relevant portion of the said judgment is reproduced hereinbelow:
".......Force Majeure and doctrine of frustration are embodied in the Indian Contract Act, 1872 (hereinafter referred to as "Contract Act") under Sections 32 and 56..... .....46. Explaining the Force Majeure Clause and the application of the same on contracts, the Ministry of Finance, CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 18 of 45 on 19th February, 2020, issued an Office Memorandum (O.M.) with respect to invocation of the Force Majeure Clause provided in paragraph 9.7.7 of the Manual for Procurement of Goods, 2017. The same is set out below:
"A Force Majeure (FM) means extraordinary events or circumstance beyond human control such as an event described as an act of God (like a natural calamity) or events such as a war, strike, riots, crimes (but not including negligence or wrong-doing, predictable/seasonal rain and any other events specifically excluded in the clause). An FM clause in the contract frees both parties from contractual liability or obligation when prevented by such events from fulfilling their obligations under the contract. An FM clause does not excuse a party's non-performance entirely, but only suspends it for the duration of the FM. The firm has to give notice of FM as soon as it occurs and it cannot be claimed ex-post facto. There may be a FM situation affecting the purchase organisation only. In such a situation, the purchase organisation is to communicate with the supplier along similar lines as above for further necessary action. If the performance in whole or in part or any obligation under this contract is prevented or delayed by any reason of FM for a period exceeding 90 (Ninety) days, CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 19 of 45 either party may at its option terminate the contract without any financial repercussion on either side. A doubt has arisen if the disruption of the supply chains due to spread of corona virus in China or any other country will be covered in the Force Majeure Clause (FMC). In this regard it is clarified that it should be considered as a case of natural calamity and FMC may be invoked, wherever considered appropriate, following the due procedure as above."
47. The Hon'ble Supreme Court in Energy Watchdog v.
CERC, (2017) 14 SCC 80 has explained that if a contract contains the Force Majeure Clause itself then it shall be governed by Section 32 of the Contract Act but if the terms are not expressly mentioned in the contract, then Section 56 of the Contract Act shall govern the contract and the course of impossible events. The Court observed as under:
"......36. The law in India has been laid down in the seminal decision of Satyabrata Ghose v. Mugneeram Bangur & Co. [Satyabrata Ghose v. Mugneeram Bangur & Co., 1954 SCR 310 : AIR 1954 SC 44] The second paragraph of Section 56 has been adverted to, and it was stated that this is exhaustive of the law as it stands in India. What was held was that the word ―impossible has not been used in the section in the CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 20 of 45 sense of physical or literal impossibility. The performance of an act may not be literally impossible but it may be impracticable and useless from the point of view of the object and purpose of the parties. If an untoward event or change of circumstance totally upsets the very foundation upon which the parties entered their agreement, it can be said that the promiser finds it impossible to do the act which he had promised to do. It was further held that where the Court finds that the contract itself either impliedly or expressly contains a term, according to which performance would stand discharged under certain circumstances, the dissolution of the contract would take place under the terms of the contract itself and such cases would be dealt with under Section 32 of the Act. If, however, frustration is to take place dehors the contract, it will be governed by Section 56."
37. In Alopi Parshad & Sons Ltd. v. Union of India [Alopi Parshad & Sons Ltd. v. Union of India, (1960) 2 SCR 793 : AIR 1960 SC 588], this Court, after setting out Section 56 of the Contract Act, held that the Act does not enable a party to a contract to ignore the express covenants thereof and to claim payment of consideration, for performance of the contract at rates different from the stipulated rates, on a vague plea of CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 21 of 45 equity. Parties to an executable contract are often faced, in the course of carrying it out, with a turn of events which they did not at all anticipate, for example, a wholly abnormal rise or fall in prices which is an unexpected obstacle to execution. This does not in itself get rid of the bargain they have made. It is only when a consideration of the terms of the contract, in the light of the circumstances existing when it was made, showed that they never agreed to be bound in a fundamentally different situation which had unexpectedly emerged, that the contract ceases to bind. It was further held that the performance of a contract is never discharged merely because it may become onerous to one of the parties."
38. Similarly, in Naihati Jute Mills Ltd. v. Khyaliram Jagannath [Naihati Jute Mills Ltd. v. Khyaliram Jagannath, (1968) 1 SCR 821 : AIR 1968 SC 522], this Court went into the English law on frustration in some detail, and then cited the celebrated judgment of Mugneeram Bangur & Co. [Satyabrata Ghose v.
Mugneeram Bangur & Co., 1954 SCR 310 : AIR 1954 SC 44] Ultimately, this Court concluded that a contract is not frustrated merely because the circumstances in which it was made are altered. The courts have no general power to absolve a party from the performance CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 22 of 45 of its part of the contract merely because its performance has become onerous on account of an unforeseen turn of events."
48. Supreme Court in Halliburton Offshore Service Inc. v.
Vedanta Limited, 2020 SCC OnLine Del 2068 has summarized the law laid down by the Supreme Court in Energy Watchdog (Supra) stating that Force Majeure operates within the ambit of Section 32 of the Contract Act if contained in a contract as contingency and would operate independently if not contained in the contract. Impossibility of the performance of contract takes place if the untoward event totally disrupts the foundation upon which the agreement was entered into. The Court held as follows:
"64. The law relating to Force Majeure has been recently settled by the Supreme Court in the case of Energy Watchdog v. Central Electricity Regulatory Commission, (2017) 14 SCC 80. The principles laid down by the Supreme Court in paragraphs 34-42 are as under:
a) Force Majeure would operate as part of a contract as a contingency under section 32 of the Indian Contract Act 1872 ('ICA').
b) Independent of the contract sometimes, the doctrine CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 23 of 45 of frustration could be invoked by a party as per Section 56, ICA.
c) The impossibility of performance under Section 56, ICA would include impracticability or uselessness keeping in mind the object of the contract.
d) If an untoward event or change of circumstance totally upsets the very foundation upon which the parties entered their agreement it can be said that the promisor finds it impossible to do the act which he had promised to do.
e) Express terms of a contract cannot be ignored on a vague plea of equity.
f) Risks associated with a contract would have to be borne by the parties.
g) Performance is not discharged simply if it becomes onerous between the parties.
h) Alteration of circumstances does not lead to frustration of a contract.
i) Courts cannot generally absolve performance of a contract either because it has become onerous or due to an unforeseen turn of events. Doctrine of frustration has to be applied narrowly.
j) A mere rise in cost or expense does not lead to frustration.
k) If there is an alternative mode of performance, the Force Majeure clause will not apply.
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 24 of 45
l) The terms of the contract, its matrix or context, the knowledge, expectation, assumptions and the nature of the supervening events have to be considered.
m) If the Contract inherently has risk associated with it, the doctrine of frustration is not to be likely invoked.
n) Unless there was a break in identity between the contract as envisioned originally and its performance in the altered circumstances, doctrine of frustration would not apply.""
16. With the above Legal background, let us examine whether the Doctrine of Force Majeure was applicable in present case. As per the WS of the defendant, the photo session with celebrity Ms. Sunny Leone & Sh. Raghu Dixit was not possible due to security reasons from the Karnataka Police Department and due to the security reasons frustration of contract was caused. The defendant has not led any evidence on record to substantiate his plea that the Karnataka Police Department had not permitted the photo session with the celebrity Ms. Sunny Leone & Sh. Raghu Dixit. In fact, as per the terms of the agreement the defendant i.e. TTC was to take care of all security measures and to ensure total safety at the function/venue. The contract / MOU Ex.P5 between the parties also contained force majeure clause which is repeated hereinbelow for the sake of clarity:
"In the event of a 'force majeure" event occurring, parties may choose to agree that the party in breach should be given CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 25 of 45 further time to perform its obligations under the sponsorship agreement. If this is the case, parties should think carefully about how long this period should be for. If the party in breach is still unable to perform its obligations by the end of the extension, should the other party be entitled to terminate the agreement or renegotiate its terms"
17. Doctrine of Force Majeure would have operated/applied, if there was untoward event or change of circumstance and it would not have been possible for the defendant to have performed the contract at all and in such an event further time was to be given to the party in breach to perform its obligations under the sponsorship agreement. However, in the present case, the event i.e. "FUSIONIGHT" did happened. It is not the case of the defendant that due to Force Majeure, the entire event had to be cancelled. The defendant except from bald statement has also not led any evidence to substantiate his plea regarding alleged security threat to the performers or to the artists or the fact that the photo session was not possible due to security reasons. The relevant cross of PW-1 in this regard is reproduced hereinbelow:
".....Q12. When did the first time it came to your knowledge that the said event will turn into a controversial event and there is a threat to Sunny Leone from prokannada protestors? A. No, I was not aware.
Q13. Can you tell how the plaintiff has dealt with the situation of force majeure as per the MOU dated 18.10.2018 CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 26 of 45 in reference to photo session with Sunny Leone is concerned?
A. No. Q14. Please suggest that in light of clause of force majeure in the MOU did plaintiff have given extra time to defendants to perform obligations as per MOU?
A. No.....
.....Ques 20: Please see your paragraph no. 5 of your evidence and tell whether Sunny Leone and Raghu Dixit have marked their special appearance / performance on centre stage or not, what is your say on that? Ans: The performance of the celebrities was to be arranged by the defendants. They had performed on the stage...... ......Ques 28: Are you aware that the similar event was scheduled in December 2017 and performance of Sunny Leone was prevented / event was cancelled due to pro kannad protest?
Ans: I am not aware.
It is wrong to suggest that there is no clause in the MOU for penalty of Force Majeure Situation......."
18. Though, a question was put during cross of PW-1 as to whether the plaintiff has dealt with the situation of Force Majeure as per the MOU dated 18.10.2018 in reference to photo session with Sunny Leone and whether plaintiff CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 27 of 45 had given extra time to defendant to perform obligations as per MOU and PW1- 1 answered both the questions in negative, but, perusal of the MOU reveals that same was to end on 03.11.2018. As the event "FUSIONIGHT" had happened on 03.11.2018, the agreement/MOU ended on 03.11.2018 itself and thus, there was no occasion with the plaintiff to give extra time to the defendant to perform the remaining obligations as per MOU. Extra time to the defendant could only have been provided as per the clause of Force Majeure, if the event itself would not have happened. Extra time could not have been provided by the plaintiff to the defendant to perform part of the contract specifically in view of the fact that the event had happened on 03.11.2018 and the MOU was to end on 03.11.2018 as specifically mentioned in the MOU Ex.P5.
19. The defendant has taken the defence of Force Majeure only in respect of the non-fulfillment of the benefits/deliverable regarding the photo session with celebrity/artist namely Sunny Leone & Raghu Dixit due to security reasons. There is nothing on record to establish that the defendant had informed the plaintiff/sponsors or had given notice of Force Majeure as soon as they came to know about the alleged security threats and this defence has been claimed by the defendant ex-post facto. It was not the case that the event itself was not possible due to the alleged security threat. The defendant has not been able to prove that they have not been able to perform the contract in totality due to Force Majeure. As per the terms and conditions of the agreement photo session was to be arranged with Sunny Leone & Raghu Dixit along with EASEMYTRIP EXECUTIVES & FANS. This photo session admittedly has not happened and it cannot be said that the same was due to the Doctrine of Force Majeure. It has not been established on record that it was impossible to perform the said term of CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 28 of 45 the contract due to Force Majeure.
Issue no. (ii) is thus, decided in favour of the plaintiff and against the defendant.
ISSUE No. (iii) Whether substantial part of contract has been performed by defendant? If so, its effect. OPD.
20. As far as performance of substantial part of contract is concerned, again defendant has not led any evidence to this fact, though onus was upon the defendant, however, as per plaintiff also, the event was organized by the defendant and it is not the case of the plaintiff that the event 'FUSIONIGHT' never happened. As per the plaintiff, the defendant did not share the floor plans of the event. It is further stated that the officials of plaintiff reached the venue and they found many discrepancies in arrangements at the venue. Plaintiff has further stated that Exclusive Boards, Hoardings, Impressions, Seat and washroom for the customers, Food and drinks, Facilitation of Director, Parking lot etc. which was promised by the defendant, was not provided and arranged by the defendant. However, as per the defendant only two clauses could not be fulfilled i.e. photo session with celebrity namely Sunny Leone & Raghu Dixit and 4 - 5 million impressions on digital platforms.
21. Let us examine the affidavit of the plaintiff and the cross of PW-1 in this regard. The emails filed on record by the plaintiff are all which were exchanged between the parties prior to the event. The event had happened on 03.11.2018. There is no email after 30.10.2018. In these emails, there is nothing to substantiate that the floor plan was sought by the plaintiff and was not shared by the defendant. The relevant cross examination of PW-1 is reproduced CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 29 of 45 hereinbelow:
"......Q2. In view of Paragraph No.7 of your evidence can you point out any email and any letter from record which was duly communicated for seeking floor plan of the event between 18.10.2018-02.11.2018?
A. It is not on record......
.......Q10. Can you elaborate/pinpoint what are the exact terms of the MOU dated 18.10.2018 are not performed/delivered by the defendants?
A. 4-5 million impression views on digital marketing i.e. Instagram, Facebook, Whatsapp etc. and Radio announcement for contestants tickets and Photo Session with Sunny Leone and Raghu Dixit was not fulfilled, Facilitation of Directors, Food and drinks for sponsers' guests.....
.....Q15. I put on you that defendants have performed all the terms of the agreement and because of this reason plaintiff has not terminated the agreement/MOU, what is your say on this?
A. No the defendants have not performed all the terms of the agreement....."
22. PW-1 also during his cross examination has admitted that 4 - 5 million impressions on digital platform were not achieved and the photo session CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 30 of 45 term with the artist Sunny Leone and Mr. Raghu Dixit could not be fulfilled. He has also stated that the Facilitation of Director, food and drinks for sponsors guests which the plaintiff company being official sponsor of said event was promised, were not provided. The event did happened.
23. As far as facilitation of Director and providing of food and drinks to the sponsor's guests is concerned, in the list of benefits and deliverables as detailed in the MOU dated 18.10.2018, no such benefit or deliverable was promised by the defendant, that the Director of the plaintiff was to be facilitated or food and drink for sponsors guests was to be provided by the organizer. The organizer was only to provide the sponsor with 2,000 VIP Guest passes and to accommodate these VIP Guests in an exclusive VIP Gallery branded only for EASEMYTRIP with partial seating arrangment for about 800 to 1000 VIP Guests in a Theatre Style Seating and Roundtable Seating Arrangement for Family Audience accommodating 20 to 25 guests. Further, the organizer was to provide space for standees and two logo branded on centre-stage backdrop LED Screen etc. Food and facilitation for Sponsors' guests and facilitation of the Directors is not mentioned in the benefits and deliverables and thus, there was no such agreement between the parties to facilitate the Directors by the organizer (TTC) and to provide food and drinks for sponsors' guests.
24. As far as 4 - 5 million impressions on the digital platform is concerned, this aspect is already dealt with in Issue no. 1 above, wherein it is already discussed that it was not the sole responsibility of the organizer to promote 4 -5 million impressions. The only part of the contract which has not been fulfilled is the photo session with the artists/celebrities, namely, Sunny CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 31 of 45 Leone and Mr. Raghu Dixit. Though, the onus of this issue was upon the defendant, but, still on careful perusal of the evidence led on record, the court is of the opinion that substantial part of the contract was performed by the defendant and only one of the condition of the contract was not fulfilled by the defendant that is with regard to the photo session with the celebrities. Issue no.
(iii) is thus, decided accordingly.
ISSUE No. (iv)Whether the plaintiff is entitled for money decree? If so, to what amount? OPP.
25. The suit is commercial in nature and squarely falls within the purview of Section 2 (1) (C) of Commercial Courts Act and plaintiff has also duly complied with mandatory provision of Pre-Institution Mediation and Conciliation as provided in Section 12 A of Commercial Courts Act, as per the non starter report Ex.PW1/11.
26. In the MOU Ex.P5 there is a clause that the courts in Delhi will have exclusive jurisdiction to adjudicate any dispute whatsoever under or connection with this agreement and thus, both the parties have agreed by way of contract to the exclusive jurisdiction of courts at Delhi and therefore, the present court has the territorial jurisdiction to try and decide the present suit. This court also has the pecuniary jurisdiction over the matter since the suit amount claimed by the plaintiff is more than the specified value of Rs.3 lacs of the Commercial Courts. The MOU was executed on 18.10.2018 and the same ended on 03.11.2018 and the present suit was instituted on 22.10.2020. Thus, the suit is filed within limitation.
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 32 of 45
27. Plaintiff has claimed an amount of Rs.17,12,500/- (wrongly typed as Rs.17,42,500/- in the plaint) i.e.
(i) Rs.13,12,500/- (wrongly typed as Rs.13,42,500/- in the plaint) as principal;
(ii) Rs.1,50,000/- towards travel and stay of staff of plaintiff company
(iii) Rs.2,50,000/- as compensation for breach of MOU.
The above three claims shall be dealt with one by one.
(i) Plaintiff has claimed Rs.13,42,500/- as principal amount paid by the plaintiff to the defendant as per MOU as sponsor for the event "FUSIONIGHT" and as per the plaintiff, the defendant had not shared the floor plans of the event and there were many discrepancies in arrangements at the venue and defendant had also failed to provide deliverables as per terms and conditions of MOU. The relevant cross examination of PW-1 in this respect is as below:
"Q6. What is the basis of claiming principal amount in tune of Rs.13,42,500 ?
A. It is matter of record......
Q10. Can you elaborate/pinpoint what are the exact terms of the MOU dated 18.10.2018 are not performed/delivered by the defendants?
A. 4-5 million impression views on digital marketing i.e. Instagram, Facebook, Whatsapp etc. and Radio announcement for contestants tickets and Photo Session with Sunny Leone and Raghu Dixit was not fulfilled, Facilitation of Directors, Food and drinks for sponsers' guests.....
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 33 of 45 ......Ques 18: Can you point out from the record any photographic evidence and invoices that can show that the plaintiff has purchased / arranged 10 standees as per MOU in the event Fusion Night?
Ans: Its not on record.
.....Ques 20: Please see your paragraph no. 5 of your evidence and tell whether Sunny Leone and Raghu Dixit have marked their special appearance / performance on centre stage or not, what is your say on that? Ans: The performance of the celebrities was to be arranged by the defendants. They had performed on the stage......
Ques 25: Please see paragraph no. 11 of your evidence affidavit and tell through documentary evidence from the record that how defendants have possessed dishonest intentions at the time of execution of MOU in the present matter?
Ans: Whatever the non compliance was done, we have mentioned in the legal notice.
Ques 26: As per your above answer given to Ques 20, I put on you that plaintiff is liable to pay third / final installment of payment to the defendants. What do you have to say? Ans: No. Vol. As the terms of the MOU are not performed by CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 34 of 45 the defendants......
......It is wrong to suggest that defendants has not provided space for 10 standees as per the terms of the MOU. It is wrong to suggest that plaintiff has not purchased 10 standees and brought at the event. It is wrong to suggest that defendants have performed all the terms of MOU that is why plaintiff has not terminated the MOU as per the terms of MOU. It is wrong to suggest that plaintiff is not entitled to claim compensation for breach of MOU as no breach of agreement took place. It is wrong to suggest that there is no clause of penalty for breach of MOU. It is wrong to suggest that defendants are entitled to legally claim third and final installment as per MOU......"
28. As already observed substantial part of the contract was carried out by the defendant and as far as facilitation of Director and not providing of food and drinks for the guest of sponsors are concerned, the same was not part of the contract or agreed benefits and deliverable. 4 - 5 million impressions on the digital platforms was also not the sole responsibility of the defendant and thus, only one of the terms of the contract was not fulfilled i.e. photo session with the artists/celebrity. There is no clause in the MOU Ex.P5 that if part of the contract is not performed, then the sponsor shall be entitled to the refund of the entire amount. As the event had happened which was attended by the guests of plaintiff as sponsors and there is no clause in the MOU Ex.P5 that in case any of the one of the condition/benefits and deliverables is not fulfilled by the CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 35 of 45 organizer, then the sponsors shall be entitled to refund of the entire amount, no ground made to direct the defendant i.e. organizer (TTC) to refund the amount received from the plaintiff/sponsor of the event "FUSIONIGHT". Further, though the counter claim of the defendant has been dismissed in default, this fact cannot be lost sight of that the plaintiff has not paid the amount of third installment i.e. Rs.3,75,000/- + GST to the defendant as per MOU dated 18.10.2018.
29. Also, though, the plaintiff has stated in the plaint that various customers had complained to them and given a negative feedback of the event, but, no such negative feedback of the said customers has been placed on record or proved on record by the plaintiff during evidence. The claim of the plaintiff for an amount of Rs.13,42,500/- as principal is thus, declined.
(ii). Plaintiff has claimed an amount of Rs.1,50,000/- towards travel and stay of staff of plaintiff company. The relevant cross examination of PW-1 in this respect is as below:
"Q5. In reference to above prayer clause please tell whether it was the responsibility of the defendants as per the MOU to arrange travel and stay of plaintiff company? A. It was the duty of the organizer to arrange travel and stay of the plaintiff company. The contents of this question is inclusive of the term Deliverable as per MOU.
Ques 19: Can you point out any specific clause / bulletin CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 36 of 45 from the MOU that food and beverage was a vital part / deliverable as per the MOU for defendants? Ans: It is orally stated for the organizer......
......Ques 24: Please see para 3 of your evidence affidavit and tell when the plaintiff is already engaged in business of ticket booking facility and hospitality. Then why the plaintiff has prayed for compensation for travel and stay beyond the MOU?
Ans: We were the sponsors of the event and everything was to be done by the defendants."
30. Perusal of the MOU reveals that no such benefits and deliverables was agreed by the organizer (TTC) to the sponsors (Easemy Trip). Even PW-1 has stated that providing for travel and stay of staff was orally agreed by the organizer. When the terms of the agreement were already reduced into writing and was signed by both the parties, this averment of the plaintiff, that the organizer had orally promised to provide food and drinks for the sponsors's guests/staff is not acceptable. Moreover, the plaintiff has claimed an amount of Rs.1,50,000/- towards travel and stay of staff of plaintiff company, but, no documentary proof regarding expenses incurred towards travel and stay of their staff has been placed on record. The plaintiff should have led clear evidence on record to substantiate their claim of Rs.1,50,000/- and should have filed the bank account statements, invoices, purchase vouchers etc. regarding the alleged exependiture in this regard. In the absence of any bank account statement, invoices and purchase vouchers or any documentary evidence in this regard, the court fails CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 37 of 45 to understand as to how the plaintiff has arrived at the figure of Rs.1,50,000/- which is allegedly spent on the travel and stay of staff of plaintiff company. Even otherwise, no such benefits and deliverables was promised by the organizer (TTC) as per MOU Ex.P5 and therefore, the claim of Rs.1,50,000/- towards travel and stay of staff of plaintiff company is also declined.
(iii). Lastly, the plaintiff is claiming an amount of Rs.2,50,000/- as compensation for breach of MOU. The relevant cross examination of PW-1 in this respect is as below:
"......Q4. Please see Prayer No. A of your plaint and tell how you make out an amount of Rs. 2.5 Lakhs for breach of MOU and kindly show the relevant clause as per MOU dated 18.10.2018 in reference?
A. It is stated that amount of Rs. 2.5 Lakhs for compensation for breach of MOU and interest asked.
......Q17. In light of Paragraph no.10 of your evidence can you point out from the record what was the damage cost financially and how the degradation of brand name of plaintiff company was done by defendant?
A. Yes......
......Ques 21: In reference to your answer given in Q17, can you point out from record where you have explained through financial calculation sheet / damage and explained CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 38 of 45 degradation of brand name through any documentary evidence or not?
Ans: Its not on record but it was made on the basis of calculation.
Ques 22: Can you today show in reference to above question the calculation sheet before the Hon'ble Court? Ans: It was done amongst the officials of the company and I have to seek the record from them......"
31. The court has specifically asked the counsel for plaintiff as to how they have arrived at the figure of Rs.2,50,000/- and also the court has specifically asked the counsel for plaintiff to file relevant case laws as to how the court should decide the appropriate compensation to be granted to the plaintiff in a situation where part of the contract was carried out by the defendant, but, one condition of benefits and deliverables (i.e. photo session with the celebrity) was not fulfilled by the defendant.
32. The court had also specifically put a query to the counsel as to what was the loss suffered by the plaintiff due to the fact that the photo session with the celebrity Sunny Leone and Mr. Raghu Dixit could not be arranged by the organizer along with EASEMYTRIP EXECUTIVES & FANS to which the ld. counsel for plaintiff has stated that the photo session would have helped in increase of business of the plaintiff. The plaintiff would have used these photographs later on for advertisement which would have helped the plaintiff to gain more business and thus, there was an expectation of the plaintiff that his CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 39 of 45 business would increase after the photo session and the event the plaintiff thus, suffered expected loss of increase in business/profits.
33. As the amount of Rs.2,50,000/- is claimed on account of breach of MOU Ex.P5, therefore, Section 73 and 74 of Indian Contract Act, 1872 being relevant are reproduced hereinbelow:
"73.Compensation for loss or damage caused by breach of contract.--When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it.
Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach.... Illustration
(q)A contracts to sell and deliver to B, on the first of January, certain cloth which B intends to manufacture into caps of a particular kind, for which there is no demand, except at that season. The cloth is not delivered till after the appointed time, and too late to be used that year in making caps. B is entitled to receive from A, by way of compensation, the difference between the contract price of the cloth and its market price at the time of delivery, but not the profits which CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 40 of 45 he expected to obtain by making caps, nor the expenses which he has been put to in making preparation for the manufacture.
74. Compensation for breach of contract where penalty stipulated for.--When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for.
Explanation.--A stipulation for increased interest from the date of default may be a stipulation by way of penalty."
34. It is a settled law that the party in breach must make compensation in respect of the direct consequences flowing from the breach and not in respect of loss or damage indirectly or remotely caused. (Reliance is placed on Pannalal Jankidas v. Mohanlal, AIR 1951 SC 145). In cases of breach of contract the damages should be such as may fairly and reasonably be considered as arising naturally or the damages may be such as may reasonably be supposed to have been in contemplation of both parties at the time they made the contract as the probable result of the breach of it. The damages, however cannot include compensation for any remote and indirect loss or damages sustained by reason CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 41 of 45 of the breach. Also, damages are not generally awarded in contract for injury to plaintiff's feeling or for mental distress, loss of reputation or social discredit.
35. In Ghaziabad Development Authority vs. Union of India, AIR 2000 SUPREME COURT 2003, Hon'ble Supreme Court while holding that compensation for mental agony could not have been awarded, observed that normally, no damages in contract will be awarded for injury to the plaintiff's feelings, or for his mental distress, anguish, annoyance, loss of reputation or social discredit caused by breach of contract and that damages for anguish and vexation caused by breach of contract cannot be awarded in ordinary commercial contract.
36. Ld. counsel for plaintiff has relied upon certain case laws as listed before. As far as the case of Mahanagar Telephone Nigam Ltd. Vs. Tata Communications Ltd., Civil Appeal No. 1766 of 2019 is concerned, in the agreement between the parties there was clause 16.2 which provided for liquidated damages and it was observed that a higher figure cannot be awarded as liquidated damages since it was a clause governing the relationship between the parties and the claimant could have claimed only a maximum of 12% per annum as liquidated damages as per clause 16.2 of the contract. The said judgment is not applicable to the facts of the present case, in as much as, no liquidated damages is stipulated in the MOU dated 18.10.2018 Ex.P5. Similarly, in the case of Construction and Design Services Vs. Delhi Development Authority, (2015) 14 SCC 263 also in penalty clause, damages were stipulated in the contract and it was held that promisee can be assumed to have suffered a loss to the extent of loss suffered as per stipulated damages clause.
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 42 of 45
37. In the present case, there was no penalty clause and no liquidated damages agreed between the parties in MOU dated 18.10.2018 Ex.P5 and thus, the case law relied upon by the ld. counsel for plaintiff as well as Section 74 of the Contract Act is not applicable. The case has to be decided in the light of Section 73 of the Contract Act which clearly mandates that compensation is not to be awarded for any remote and indirect loss or damage sustained by a party due to breach of contract. PW-1 has also not stated about any loss suffered by the plaintiff and he has only stated about the calculation sheet which was done amongst the officials of company and further deposed that he would have to seek record from the company. No record regarding any loss or damage suffered by the plaintiff has been placed on record or proved during the evidence, regarding the expected loss of profit/business which otherwise is also an indirect or remote loss.
38. The defendant in the present case has cross examined PW-1, but, has not led any DE. However, merely because the defendant has opted not to lead evidence in rebuttal in the case does not mean that the plaintiff is entitled for an automatic decree.
39. It is a settled law that plaintiff has to stand on his own legs. In the case Anil Rishi Vs. Gurbaksh Singh (2006) 5 SCC 558 it was held-
"the initial burden of proof would be on the plaintiff in view of Section 101 of the Evidence Act......In terms of a said provision the burden of proving the fact rest on the party who substantially asserts the CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 43 of 45 affirmative issues and not the party who denies it......In terms of Section 102 the initial burden is always on plaintiff and if he discharges that onus and makes out a case it entitles him to a relief, the onus shifts to the defendant to prove those circumstances, if any, which would disentitle the plaintiff to the same."
40. In the case Suresh Khan Vs. State of Jharkhand 2018 SCC online JHAR 1572 it was held-
"That parties to the suit must stand on their own legs and it is the responsibility of the party taking a specific plea to prove it by way of producing necessary evidence".
41. Thus, the court of law has to render judgment on merits taking note of facts and circumstances of each case. Though, it has been established on record that the defendant has not fulfilled one of the condition of the MOU Ex.P5 i.e. photo session with the Sunny Leone and Mr. Raghu Dixit and had thus, not delivered all the benefits as agreed upon between the parties, but, still as the plaintiff has failed to prove on record any loss or damage suffered by them due to the non-fulfillment of the said deliverable and benefit, the plaintiff is not entitled to any amount on account of breach of MOU dated 18.10.2018 Ex.P5.
In view of the above discussion, plaintiff is not entitled to any money decree as prayed for. Issue is decided against the plaintiff and in favour of the defendant.
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 44 of 45 ISSUE No. (v)Whether the plaintiff is entitled for any interest? If so, at what rate and for which period. OPP
42. In view of the above findings, as the claim of plaintiff of Rs.17,12,500/- (i.e. Rs.13,12,500/- as principal and Rs.1,50,000/- towards travel and stay of staff of plaintiff company and further Rs.2,50,000/- as compensation for breach of MOU) has already been declined, thus, the issue of grant of interest @ 24% per annum does not survives. Issue is, thus, decided accordingly.
Relief/Conclusion
43. In view of above discussion, I am of the view that the plaintiff has failed to prove their claim by any cogent evidence and thus could not discharge the burden of proving their claim for an amount of Rs.17,12,500/-. Hence, the plaintiff is not entitled for the money decree as prayed. Accordingly, the suit of the plaintiff is dismissed. In the peculiar facts and circumstances of the case, no order as to costs and both parties to bear their own costs.
File be consigned to Record Room.
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2024.09.26
Pronounced in open court on
17:00:40
+0530
26th day of September, 2024 (Kiran Bansal)
District Judge, Commercial Court-02
Shahdara, Karkardooma Courts
Delhi/26.09.2024
CS (Comm) No. 420/2020 M/s. Easy Trip Planners Ltd. Vs. M/s. Times Creations Page No. 45 of 45