Delhi District Court
Shri Sanjay Shah vs M/S Mars International Auto ... on 18 May, 2013
IN THE COURT OF SH. SUNIL RANA
ADDL. DISTRICT JUDGE II(N/W), ROHINI, DELHI
CS NO. 2572/09
Unique Code No. 2404C0294682009
Shri Sanjay Shah,
Proprietor of M/s Prakash Auto Gas,
162/4, Sector2, Rohini,
Delhi110085. .... Plaintiff
VERSUS
1. M/s MARS International Auto Corporation,
A Partnership Firm,
SCF79, Red Square Market,
Hisar125001 (Haryana)
2. Shri Rajender Singh Mallik,
S/o Shri Jaggi Ram Mallik,
Partner of M/s Mars International Auto Corporation
3. Smt. Sunita Malik
W/o Shri Rajender Singh Mallik,
Partner of M/s Mars International Auto Corporation
4. Shri Gaurav Mallik
S/o Shri Rajender Singh Mallik,
Partner of M/s. Mars International Auto Corporation
5. Ms. Anjali Mallik
D/o Shri Rajender Singh Mallik,
Partner of M/s Mars International Auto Corporation
CS no. 2572/09 page no. 1 of 44
All 2 to 4 residents of:
SCF79, Red Square Market,
Hisar125001 (Haryana) .... Defendants
Date of Institution : 12.11.09
Date on which case was reserved for order : 16.05.13
Date of pronouncement of order : 18.05.13
JUDGMENT
1. Vide this judgment, I shall decide the suit filed by the plaintiff against the defendants for the recovery of amount of Rs. 19,20,570/.
2. Brief facts as stated in the plaint are that plaintiff is the proprietor of M/s Prakash Auto Gas carrying on business of automobiles for the last 25 years at Delhi and defendant no.1 is the partnership firm of defendants no. 2 to 5 and manufacturer of Electric Scooter under the brand name of "MARS " and the defendants no.2 to 5 are incharge and responsible for the day to day business working and activity of their partnership firm i.e. M/s Mars International Auto CS no. 2572/09 page no. 2 of 44 Corporation (defendant no. 1) and the defendant no. 2 as partner of defendant no. 1 was dealing with the plaintiff and liability of all the defendants are joint, several and coextensive.
3. It has been contended that for launching of its product i.e. "Electric Scooter" in Delhi region, the defendant no1 through defendant no2 had appointed the plaintiff as an agent for promotion of sale of their product in Delhi and had advised the plaintiff to take each and every steps to approach the public in general through advertisement in electronic media and by other means through advertisements, installation of signboards, hoardings, banners, roadshows and organizing school functions to give know how to the public in general and demonstrate the working and efficiency of the said product which was running on batteries instead of other fuel consumption and the entire expenses for promotion of sale thereof were exclusively to be borne by the defendants and were to be reimbursed to the plaintiff.
CS no. 2572/09 page no. 3 of 44
4. It has been submitted that defendants have also promised to establish a service station in Delhi to provide after sale service to the customers and for redressal of the complaints made by the customer with regard to the working and efficiency of the product and as per understanding had instructed the plaintiff to arrange the space where the stocks of "MARS Electric Scooter" were to be kept for demonstration to the public and for sales thereof and rent of the premises was agreed to be paid by the defendants and a premises bearing no. 162/4, Sector2, Rohini, Delhi @ Rs. 20,000/ was arranged and made suitable for demonstration & sale of product w.e.f August 2007 to July 2008 and was approved by the defendants after spot visit & inspection.
5. It has been further contended that consequent to the creation of agency, the defendants had also obtained certain blank signed cheques from the plaintiff which were given by plaintiff in good CS no. 2572/09 page no. 4 of 44 faith and trust and defendants have agreed to pay commission @ 20% on the sale of 'MARS' Electric Scooter to the plaintiff and since the product was new and to run on battery and as such rigorous efforts were required to convince the public about its efficiency & compatibility as certain branded scooters running on petrol/diesel/ other fuel were already in the market and the plaintiff had made huge payment for arranging advertisement through signboards, banner, hoarding, roadshows, school functions and also made payment at Auto Expo Trade Fair Organised for Automobile at Pragati Maidan, New Delhi.
6. It has been further contended that plaintiff has also employed staff at the sale center and for other related activities for the promotion of the sale and the payment of salary to the staff was to be made by the defendants and following payments made to the concerned persons/agencies for the promotion of sale are as under:
CS no. 2572/09 page no. 5 of 44
SI. PARTICULARS PAYMENTS
NO. MADE (in
Rupees)
a) Expenses incurred for arranging ads 2,07,930.00
through hoardings, signboards,
banners, gift items
b) Expenses incurred for conducting 60,000.00
road shows
c) Expenses incurred for arranging 50,000.00
school functions where the product
was introduced and demonstration
thereof given
d) Expenses incurred for advertisement 55,000.00
in electronic media, i.e. Delhi Aaj
Tak, Sadhna Channel and Poorva
Channel
e) Payments made at Auto Expo Trade 1,53,640.00
Fair, Pragati Maidan, New Delhi
where your product was kept for
demonstration
f) Payments made to the staff for the 1,20,000.00
period July 2007 to August 2008
TOTAL 6,46,570.00
7. It has been further contended that defendants have failed to make the abovesaid payment of Rs. 6,46,570/ to the plaintiff for the CS no. 2572/09 page no. 6 of 44 expenses incurred towards promotion of sale which were to be reimbursed by the defendants.
8. It has been further contended that the defendants were requested to establish the service station for providing service to customer but they have failed to set up any service station in Delhi and customers had filed complaints before the Consumer Forum for redressal of their grievances and due to the act of omission & commission of defendants for not establishing a service station an expenses of around Rs, 30,000/ was incurred for contesting the complaint before the Consumer Dispute Redressal Forum and amount is recoverable from the defendants and for these reasons reputation & goodwill of the business of plaintiff was damaged and the plaintiff has assessed the damage to the tune of Rs. 10 lacs for the loss of reputation and business, which the defendants are liable to compensate to the plaintiff.
CS no. 2572/09 page no. 7 of 44
9. It has been further contended that defendants are also liable to pay arrears of rent of the premises no. 162/4, Sector2, Rohini, Delhi for the period August 2007 to July 2008 @ Rs. 20,000/ p.m. amounting to Rs. 2,20,000/ and electric charges of Rs. 24,000/.
10. It has been further contended that defendants have promised to make all the payment of the expenses and to return the blank cheque bearing no. 157150 drawn on J&K Bank Ltd. Delhi which they had failed to return despite several demands and filled the above said cheque for an amount of Rs. 3,11,987/ which was given to them at the time of creation of agency and was not issued towards any legally recoverable debts. It has been prayed that defendants are liable to settle the account of plaintiff by making the payment of Rs. 19,20,570/ towards the expenses of advertisement & electronic media, arrears of rent and damages for loss of business, goodwill & reputation along with pendente lite and future interest @ 18% p.a. CS no. 2572/09 page no. 8 of 44
11. Ld. Counsel for the plaintiff has relied upon judgments, tilled as Kerala Agro Industries Corporation Ltd. & Anr. Vs. M/s Beta Engineers, 2012 I AD (Delhi) 878.
12. Summons of the suit were issued to the defendants and were served and contested the suit. WS was filed on behalf of defendants no. 1 & 2 raising preliminary objections that suit is false and frivolous as there is no cause of action arose in favour of the plaintiff as present suit is a counter blast to the criminal complaint U/s 138 of Negotiable Instrument Act filed by the defendant no. 1 through defendant no. 2 against the plaintiff in the Court of Chief Judicial Magistrate, Hisar, Haryana and now he has concocted and cooked up the story in order to avoid the criminal proceedings filed against him.
13. It has been further submitted that on the contrary, plaintiff had approached the defendants and agreed to open the show room with regard to the electric scooter manufactured by the defendant no.
CS no. 2572/09 page no. 9 of 44 1, who had agreed to appoint plaintiff as agent and scooter were purchased from time to time as per the order placed and at no point of time any promises were made by the defendants to compensate the plaintiff of alleged claim as there was no such understanding to compensate or reimburse the alleged expenses incurred by the plaintiff. It has been submitted that in fact, plaintiff had failed to provide the necessary service to the customer and name of the defendant no. 1 was spoiled due to working and activities of the plaintiff and were forced to terminate the agency of the plaintiff.
14. It has been submitted that at no point of time any advise to approach the general public thorough advertisement or any electronic media was given to the plaintiff and said advertisement/promotion, if any, given by the plaintiff was his own decision in order to maximize his profits and no such bills for the alleged expenses has either been submitted by the plaintiff or reimbursed by the defendants at any point CS no. 2572/09 page no. 10 of 44 of time till the termination of his agency.
15. It has been submitted that plaintiff had opened his show room for the sale of scooters and there was no such agreement between the parties that the rent of the showroom is to be paid by the defendants and the alleged plea of the plaintiff to recover rent @ Rs. 20,000/ p.m. is also not sustainable and there was no such understanding to reimburse the expenses incurred by the plaintiff and the present suit is false and mere concoction in order to put pressure upon the defendants to compromise the criminal complaint filed by them against the plaintiff U/s 138 of NI Act and no amount is due or payable to the plaintiff by the defendants.
16. It has been submitted that goodwill of the plaintiff was not damaged and alleged claim of Rs.10 lacs towards damages is false, frivolous and baseless and rent of premises, if any and other incidental expenses incurred on promotion of sale is not payable by the CS no. 2572/09 page no. 11 of 44 defendants and as such plaintiff is not entitled to amount of Rs. 19,20,570/ and suit is liable to be dismissed.
17. It is worthwhile note here that vide order dt. 19.05.2010 passed by the ld predecessor of this court, defendant no3 had also adopted the WS filed on behalf of defendants no. 1& 2.
18. Written statements was also filed on behalf of defendants no 4 & 5 raising preliminary objections that suit of the plaintiff is without any cause of action and is a counter blast to the criminal complaint u/s 138 NI Act filed against the plaintiff. It has been submitted that plaintiff in order to make out a claim has falsely alleged that defendants have agreed to compensate the plaintiff with regard to his alleged claims for sales promotion and the suit filed by the plaintiff is not maintainable and has been filed to pressurized the defendants in order to withdraw the complaint filed against the plaintiff.
19. It has been submitted that appointment of staff for promotion CS no. 2572/09 page no. 12 of 44 of sales and their alleged salary was responsibility of the plaintiff and the defendants have no liability of any nature as there was no understanding to reimburse the salary or any other expenses incurred by the plaintiff and defendants are not liable to pay any amount towards arrears of the rent or electricity expenses and plaintiff is not entitled to recover the suit amount of Rs. 19,20,570/ from the defendants and the suit is liable to be dismissed with cost.
20. Ld. Counsel for the defendant has relied upon judgment titled, Rajinder Pershad vs. Darshana Devi, AIR 2001 SC 3207 and Brij Kishore & Anr. Vs. State, decided on 10.05.10, Crl. A.927/08.
21. Replication to the written statements of defendants were filed and contents of the plaint has been reiterated and reaffirmed by the plaintiff.
22. From the pleadings of the parties following issues were CS no. 2572/09 page no. 13 of 44 framed by the Ld. Predecessor vide order dated 02.08.2010 which are as under:
1. Whether the plaintiff is entitled for a decree of Rs. 19,20,570/ alongwith pendentelite and future interest at the rate of Rs. 18% from the date of filing of the suit till realization? OPP
2. Whether no case of cause has accrued in favour of the plaintiff of plaintiff? OPD
23. In order to prove its case plaintiff has examined witnesses, namely, Sh. Sanjay Shah, himself as PW1, Sh.Gagan Sood as PW 2, Sh. Vijay Raina as PW3 and Sh. Shambhu Nath from Confederation of Indian Industry, as PW4. On the other hand, defendant has examined Rajinder Singh as DW1 and Jitender Kumar Gupta as DW2. Detailed testimonies of the witnesses will be discussed in the later part of the judgment.
24. I have heard the arguments on behalf of the parties, evidence placed on record and also gone through the written submissions filed on behalf of the parties.
CS no. 2572/09 page no. 14 of 44
25. My issue wise findings are as under:
ISSUE NO.1 : Whether the plaintiff is entitled for a decree of 19,20,570/ alongwith pendente lite and future interest at the rate of Rs. 18% from the date of filing of the suit till realization? OPP The onus to prove this issue was on the plaintiff. PW1 has deposed on the line of pleadings that he is the proprietor of M/s Prakash Auto Gas, carrying on the business of automobiles & CNG, at shop no.1, situated at 162/4, Sector 2, Rohini for the last 25 years and defendants for launching of its product, i.e., electric scooter in Delhi region had appointed the plaintiff as an agent for the promotion of sale of their products in Delhi region and has advised the plaintiff to take steps to approach the public in general through advertisement in electronic media and by other means to give knowhow to the general public and demonstrate the working and efficiency of the said product which was running on batteries instead of other fuel and the entire expenses incurred by the plaintiff for promotion of sale were to be CS no. 2572/09 page no. 15 of 44 reimbursed by the defendants.
26. PW1 has further deposed that staff at the sales centre and other related activities for promotion of sales were employed on the instructions of the defendants and their salaries were to be made by the defendants and expenses incurred for arranging advertisement through hoardings, signboard, banners, gift items, etc., amounting to Rs.2,07,930/ are reflected in the bills which are Ex.PW1/1 to Ex.PW 1/11(Mark A & B) and the payments made for conducting roadshows amounting to Rs.60,000/ is reflecting in bill Ex.PW1/12 and amount of Rs.50,000/ was paid for arranging school functions where MARS scooty were demonstrated and the bill is Ex.PW1/13 and photographs of the function are Ex.PW1/14& Ex.PW1/15(colly.) and another expenses of Rs.55,000/ incurred on advertisement in electric media, i.e., Delhi Aaj Tak, Sadhna Channel and Poorva channel is Ex.PW 1/16. PW1 has further deposed that another payment was made to CS no. 2572/09 page no. 16 of 44 confederation of Indian Industry and the receipts of Rs.1,19,832/ & Rs.33,708/ of the payment are Ex.PW1/17 & Ex.PW1/18 respectively and payment of salaries given to staff by the plaintiff are Ex.PW1/19 (colly.) and the total amount to be paid by the defendant on the abovesaid account comes to Rs.6,46,570/.
27. PW1 has further deposed that copy of complaint filed by one Smt. Renu Tripathi is Ex.PW1/20 and the reply filed by plaintiff is Ex.PW1/21 another complaint filed by Mrs. Chandrawati is Ex.PW 1/22 and the copies of reply is Ex.PW1/23 and to defend the abovesaid complaint a litigation expenses of Rs.30,000/ was incurred and same is recoverable from the defendants as they have failed to establish a service station at Delhi.
28. PW1 has further deposed that defendants have also instructed the plaintiff to arrange the space where the stock of MARS electric scooter were to be kept for demonstration to the public and CS no. 2572/09 page no. 17 of 44 sale thereof and rent of the premises no. 162/4, Sector 2, Rohini, for the period August '2007 to July' 2008 @ Rs.20,000/ p.m. amounting to Rs.2,20,000/ was not paid and the defendants are also liable to pay the electricity charges of Rs. 24,000/ .
29. PW1 has further deposed that due to the omission and commission of not establishing a services station in Delhi region to provide services to its customers, the business of the plaintiff in the market was ruined and has damages the reputation of the plaintiff in the market and the customer booklet of MARS scooter is EX PW1/24 and the damages to the tune of Rs.10 lacs for the loss of business reputation and goodwill is liable to be compensated by the defendants and legal notice dt.19.11.08 Ex.PW1/25 was sent through postal receipt Ex.PW1/26 and its returned envelope is Ex.PW1/27 and defendants are jointly & severally liable to pay the suit amount.
30. Let us see the relevant portion of crossexamination of PW CS no. 2572/09 page no. 18 of 44 1 wherein it has been admitted that there was no written agreement with regard to the agency and the place of showroom was owned by his wife which was taken on rent but there was no rent agreement in writing and no rent receipt was ever issued to him by his wife and voluntarily stated that it was a family affair. PW1 has further stated in his crossexamination that he had not filed any bill book or statement of account on record. It is worthwhile to mention here that counsel for the defendant has asked specific questions in this regard which are reproduced as follows: "Q. Had therein any correspondence between you and defendant?
A. No such letter was written by me to the
defendant.
Q. Have you placed or submitted any bills with
respect to the expenditure incurred for trade promotion to Mr. Malik during the subsistence of agency?
A. Mr. Malik used to screen the documents himself at the business place at Delhi."
31. PW1 has further stated in his crossexaminations that CS no. 2572/09 page no. 19 of 44 Ex.PW1/1 to Ex.PW1/13, Ex.PW1/16 & Ex.PW1/19(colly) does not bear the signature of defendant no.2 and he was not maintaining any cash book, attendance register of employees or salary register during the period from August'2007 till July'08 and admitted in his cross examination that during the subsistence of agency agreement no amount of expenses was paid to him and has not made any written demands and no debit note was issued to the defendants with respect to the amount claimed by him.
32. PW2 has deposed that he is the proprietor of M/s Gagan Motor and properties carrying on business of sale & purchase of cars and know the plaintiff who is carrying on business in the same market and defendant no.1 is a manufacturer of electric scooter under the brand name of MARS and plaintiff was advised to take step to approach the public in general through advertisement in media and other means.
CS no. 2572/09 page no. 20 of 44
33. PW2 has stated in his crossexamination that he is not aware whether any agreement was executed between the plaintiff & defendants and no writing regarding the settlement of trade terms had taken place in his presence and not participated in any negotiation and Mr. Malik had never assured the plaintiff in his presence that he would repay the expenses incurred by the plaintiff for business promotions.
34. PW3 has deposed that he is the proprietor of M/s Toshit Technologies carrying on the business of computer at Shop no. A 2/69, Sector 3, Rohini and know the plaintiff since 1989 who carried on the sale of the MARS electric scooters for a very brief period and had to close down as he had faced various complaint about the performance and efficiency of the product besides deficiency in service and has caused damages to the goodwill & reputation of the plaintiff.
CS no. 2572/09 page no. 21 of 44
35. PW3 has stated in his crossexamination that he is not aware whether any agreement with regard to settlement of trade terms was executed between the plaintiff & defendants and he cannot say about the actual loss sustained by the plaintiff as he has not seen any documentary proof with respect to the loss and he is not aware whether any rent agreement was executed between the plaintiff & defendant as showroom was owned by the wife of plaintiff.
36. PW4 has brought the summoned record from Confederation of Indian Industry, which deals in organizing seminar/workshops and conferences and the defendants had launched his products MARS electric scooty at Pragati Maidan and payment/charges for exhibition of electric scooty "MARS" were made by Prakash Auto Gas and the certificate in this regard from the company are Ex.PW4/1 and Ex.PW4/2 and receipt for an amount of Rs.1,53,539/ issued by the Trade Fair Department of Confederation CS no. 2572/09 page no. 22 of 44 of Indian Industry is Mark "C".
37. PW4 has stated in his crossexamination that he has no knowledge whether defendant has adjusted the amount paid by the plaintiff to the CII.
38. On the other hand defendants have examined DW1, who has deposed on the line of pleadings that suit of the plaintiff is a counter blast to the criminal complaint u/s 138 of NI Act filed by the defendants against the plaintiff in the court of Chief Judicial Magistrate, Hissar, Haryana. DW1 has deposed that in fact, the plaintiff had approached the defendant no.1 to open the showroom of electric scooter manufactured by the defendants and the defendant no.1 had agreed to appoint the plaintiff as its authorized agent and the scooters were purchased by the plaintiff from time to time as per the orders placed and at no point of time any such offer was made by defendants to compensate the plaintiff with regard to its alleged claim CS no. 2572/09 page no. 23 of 44 of sale promotion as there was no commitment made by the defendants to the plaintiff and the entire expenses incurred by the plaintiff was for his own personal benefits to increase the sale & profits.
39. DW1 has deposed that defendants had never instructed the plaintiff to arrange the space for demonstration of the MARS electric scooter to the public and there was no understanding to pay the rent of the premises by the defendants and appointment of the staff for promotion of sale and their alleged salaries was the responsibility of plaintiff and the alleged claim of Rs.10 lacs is a concocted figure in order to put a false claim and defendants are not liable to pay the suit amount as the amount paid by the plaintiff on behalf of the defendants to arrange space at ITPO Pragati Maidan was duly credited in the statement of accounts which is Ex.DW1/1.
40. Let us see the crossexamination of DW1, relevant portion CS no. 2572/09 page no. 24 of 44 of cross examination are reproduced here as under: "Q. Apart from Delhi whether you created any other agency at any other place of sale of MARS scooter? A. Yes, apart from Delhi, I appointed agency in Haryana, Rajasthan, Kerala, U.P., Punjab.
Q. Kindly state at which places you established the service centers for conducting the service of MARS scooters?
Ans. No service center was created at any place. Voln. Workers of all the dealers were trained by our technician to provide service and it was duty of the dealers to provide the service to all the customers.
Q. Whether on appointment of the plaintiff as the authorized sales agent of defendant no.1, whether you had reduced any terms and conditions in writing favoring plaintiff?
A. No, nothing was reduced into writing.
Q. I put to you that terms and conditions of the authorized sales agent were orally settled?
A. No. (vol. I had given the terms and condition in writing on the non judicial stamp paper of Rs.100/ but I did not keep the copy of the same) Q. I put to you have you pleaded this fact in your written statement that terms and conditions of the agency were reduced into writing between the parties?
Ans. No. Q. Have you given any notice to the plaintiff to produce the alleged agreement with regard to the terms and conditions of authorized sales agency of the plaintiff?
CS no. 2572/09 page no. 25 of 44 Ans. I do not understand about the legal formality and therefore, I did not issue any legal notice.
Q. No such alleged agreement/proposal was ever provided by you to the plaintiff?
Ans. I had provided agreement/proposal to the plaintiff to understand all the terms and conditions and return it to me for signature and authentication but it was never sent to me.
Q. I put it to you that no such plea has ever been taken by you regarding the alleged agreement/proposal in the written statement?
Ans. No such plea was taken as the proposal agreement did not materialize and it was mere a draft.
Q. I put to you that the aforesaid payment of Rs.1,53,640/ made by the plaintiff is liable to be repaid and reimbursed by the defendant no.1 to the plaintiff? A. The money was not to be reimbursed and was to be adjusted in the account of the plaintiff which has already been done.
41. DW1 has denied the suggestion that the defendants are liable to pay the alleged claim of Rs.6,46,570/ and are also liable to make payment of Rs.2,44,000/, being the arrear of rents including electricity charges.
42. DW2 Sh. Jitender Kumar Gupta has tendered evidence by CS no. 2572/09 page no. 26 of 44 way of affidavit Ex. DW2/A and tried to prove the statement of account Ex.DW2/1 and was objected to the mode of proof and beyond pleadings by the counsel for the plainiff.
43. DW2 has stated in his crossexamination that he is doing part time job of accountancy with so many firms at Hissar and also worked part time with defendant no.1 concern since 2005 till last year and Ex.DW2/1 does not bear his signatures which is a computer print out and was taken out by him in the year 2010.
44. In the instant case, the plaintiff has basically claimed the amount of Rs.19,20,570/ out of which Rs.6,46,570/ is towards the advertisement/sale promotion and staff salaries which are alleged to be reimbursed by the defendants and another sum of Rs. 2,20,000/ towards the arrear of rent of 11 months of the premises/shop and Rs. 24,000/ towards the electricity charges and another sum of Rs.30,000/ towards the litigation expenses and another sum of Rs.10 CS no. 2572/09 page no. 27 of 44 lacs towards damages for the loss of reputation and goodwill of his business.
45. Now, I will take up all the claims of the plaintiff one by one and the finding are given as under:
1) Recovery of Rs.6,46,570/ towards the advertisement/sale promotion including staff salaries:
Agent is defined in Section 182 of the Indian Contract Act in following words:
182. "Agent" and "Principal" defined "An agent is a person employed to do any act for another or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the "principal".
46. Hon'ble Supreme Court in judgment titled as "Gordon Woodruffee & Co. Vs. Shaik M.A. Majid & Co. AIR 1967 SC 181", has observed that a "procurement agent" has been held to be not an agent, as he is only a person directed to do an act on a commission basis and not to represent another.
CS no. 2572/09 page no. 28 of 44
47. It is a well settled that to know whether a person occupies a position of an agent or not, the law has to go by his function and to see the substance of the transactions and not the parties terminology.
48. In the instant case, there is no iota of oral or documentary evidence which indicates that defendants have expressed their intention to reimburse the expenses for promotion of sale by the plaintiff. There is no written agreement to show that parties have agreed that all the expenses of sales promotion will be reimbursed by the defendants.
49. It is worthwhile to note here that no cogent evidence has been brought on record by the plaintiff to establish that during the existence of agency, the expenses incurred by the plaintiff was ever paid or reimbursed by the defendants. It is also worthwhile to mention here that PW2 & 3 have stated in their cross examination that they are not aware whether any agreement was executed between the CS no. 2572/09 page no. 29 of 44 plaintiff & defendant and no writing regarding the settlement of trade terms took place in their presence. PW2 has also stated in his deposition that he has never participated in any negotiation between the plaintiff and defendants and Mr. Malik/defendant no2 had never assured the plaintiff in his presence that he would repay the expenses incurred by the plaintiff for business promotion.
50. In the present case, there is no written agreement between the parties showing the terms & conditions of the agency and nothing has come in the deposition of the PW's to prove that there was any understanding between the parties that alleged expenses towards the sale promotion will be reimbursed by the defendants and plaintiff is entitled to recover the amount from the defendants.
51. It is worthwhile to mention here that PW1 has stated in his cross examination that no bill book or statement of account has been filed on record and no such amount was ever paid to him for any of his CS no. 2572/09 page no. 30 of 44 claim and no written demands or debit notes were issued to the defendants during the subsistence of agency agreement.
52. Plaintiff has failed to bring any cogent evidence on record to substantiate his claim. In the absence of any oral or documentary evidence with regard to the reimbursement of alleged claim towards sales promotion. Pleading is no evidence, far less proof. I am of the view that plaintiff has failed to prove on recored that it was agreed between the parties that alleged expenses of sale promotion are to be reimbursed by the defendants and plaintiff is entitled to recover the said amount of Rs. 6,46,570 from the defendants . Hence, it can be easily said that plaintiff is not entitled to the recovery of Rs. 6,46,570 towards the advertisement/sale promotion.
2) Recovery of Rs.2,44,000/( rent of 11 months @ Rs.20,000/ per month including electricity charges of Rs.24,000/)
53. PW1 has stated in his deposition that the defendants have CS no. 2572/09 page no. 31 of 44 also instructed the plaintiff to arrange the space where the stocks of MARS electric scooter were to be kept for demonstration to the public and for sale thereof and the rent of the premises was agreed to be paid by the defendants and shop no. 4 situated at 162/4, Sector 2, Rohini was arranged @ Rs. 20,000/ p.m. commencing w.e.f August, 2007 to July, 2008 and was approved by the defendants after spot visit and inspection.
54. In the present matter, while assessing the claim towards the rent. It is an undisputed fact that there is no written agreement between the parties to show that the rent of the premises was to be paid by the defendants. It is worthwhile to note here that landlady who is stated to be the wife of the plaintiff has not even examined as witness to prove this fact that rent amount was to be paid by the defendants and PW2 has stated in his deposition that he is not aware whether any rent agreement was executed between the parties and CS no. 2572/09 page no. 32 of 44 the showroom was owned by the wife of plaintiff.
55. Plaintiff has also not been able to prove on record that defendants have agreed to pay the rent of the premises which actually belonged to the wife of the plaintiff. No cogent evidence has been brought on record to prove this fact that the defendants are liable to pay the rent of the premises, where the plaintiff was running a business. In the absence of any evidence to substantiate his claim of arrears of rent and electricity charges, it can not be said that plaintiff is entitled to recover the arrears of rent of the premises of the plaintiff including electricity charges.
3) Recovery of Rs.30,000/ for the litigation expenses for defending the complaint filed by the customers.
PW1 has deposed that in pursuant to the service manual of the product, the defendants had promised to establish the service station in Delhi to provide redressal of the complaint with regard to the service of the product. PW1 has deposed that subsequently complaints were CS no. 2572/09 page no. 33 of 44 filed by the customers before District Consumer Redressal Forum (DCRF) and copies of the complaint and reply are Ex.PW1/20 to Ex.PW1/23 and customer booklet of MARS scooter is Ex.PW1/24 and litigation expenses of Rs.30,000/were incurred by the plaintiff which is to be recovered from the defendants as they have failed to provide after sale service and there was a deficiency of service on the part of the defendants. PW1 has further deposed that in order to defend the abovesaid complaint amount of Rs.30,000/was incurred towards litigation expenses and the same is recoverable from defendants as they have failed to establish service station at Delhi.
56. Plaintiff has not brought any cogent evidence on record to establish that there was any understanding that after sale service will be provided by the defendants and the deficiency in services was due to the fault of the defendants and amount incurred towards the litigation expenses is recoverable from the defendants. On the other CS no. 2572/09 page no. 34 of 44 hand, DW1 was asked specific question on this point and same has been reproduced herein for reference as under: "Q. I put to you as to whether anything was reduced into writing that the plaintiff was to render the after sale service to the customers?
A. This is mentioned in the service booklet alongwith 23 coupons and two paid coupons that the service will be provided by the sale agency as all the automobile companies in India are following the same trade practice."
57. In view of the evidence led on behalf of the parties, plaintiff has failed to establish that he was entitled to recover Rs.30,000/ towards the litigation expenses from the defendants for defending the complaint filed by the customers. Hence, it cannot be said that plaintiff is entitled to recover the litigation expenses.
iv) Recovery of Rs.10 lacs towards the damages for the loss of reputation & goodwill of the business of plaintiff.
What is damages? Damage means loss or detriment to one's property, reputation, etc., or harm done to a thing or a person. It is necessary to note that in order to claim damages to plaintiff's CS no. 2572/09 page no. 35 of 44 reputation, plaintiff has to show that how he has suffered the loss of amount claimed in the compensation for loss or injury sustained and that was suffered due to the acts of the defendants. Plaintiff who had taken plea had to prove strictly by producing cogent and clear evidence in law.
58. As per section 12 of Indian Evidence Act, which is reproduced as under:
"In suits for damages, facts leading to enable court to determine amount are relevant. In suits in which damages are claimed, any fact which enable the court to determine the amount of damages which ought to be awarded, is relevant."
59. It is a well settled proposition of law that claim towards damages must not be merely pleaded but has to be established by clear evidence, which is further subject to two qualifications that loss/damages was suffered due to the act of the defendant and the plaintiff has actually suffered the damages as claimed for.
60. In the present case, plaintiff has not brought on record any CS no. 2572/09 page no. 36 of 44 evidence or details of the loss or damages suffered by him to the tune of Rs.10 lacs as claimed by him. It is worthwhile to note here that PW 3 has stated in his deposition that he cannot say about the actual loss sustained by the plaintiff as he has not seen any documentary proof with respect to the loss. Plaintiff has failed to prove on record that how the amount of alleged damages to the tune of Rs. 10 lacs has been arrived at and how the amount is recoverable from the defendants.
61. Pleading is no evidence, far less proof. In the absence of any oral or documentary proof to substantiate the claim of damages to the tune of Rs. 10 lacs, it can be easily concluded that plaintiff is not entitled to recover an amount of Rs.10 lacs towards the damages for the loss of reputation and goodwill from the defendants. Hence, no such relief of damages can be granted to the plaintiff.
62. Counsel for the Plaintiff has relied upon the judgment and the ratio of that case do not support the plea of the plaintiff as the CS no. 2572/09 page no. 37 of 44 case of plaintiff is distinguishable. Hon'ble High Court has made some observations and on the basis of same it can not be held that they are in support of the plea and contentions of the plaintiff. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made in it. The ratio of the decision must be understood in the background of the facts of that case. It is a well settled that a case is only an authority for what it actually decides and not what logically follows from it. It is also well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision. In P.S. Rao Vs. State J.T. 2002 (3) Supreme Court 1 has held as under:
"There is always a peril in treating the words of judgment as though they are words in a legislative enactment and it is to be remembered that judicial utterance are made in setting of the facts of a particular case. In circumstantial flexibility and additional or different facts make a world of difference between CS no. 2572/09 page no. 38 of 44 conclusion in two cases."
63. In another case Rafiq Vs. State 1990 SCC 946, it was observed as under:
" The ratio of one case can not be mechanically apply to another case without having regard to the facts, situation and circumstances in two cases."
64. In view of the discussion made above, I am of the view that judgment relied upon by the plaintiff is not applicable in the facts and circumstances of the present case.
65. Initial onus to prove its case is always on the plaintiff and if he discharges that onus and makes out a case which entitles him to a relief, the onus shifts to the defendant to prove those circumstances , if any, which disentitle the plaintiff of the same. It is worthwhile to mention here that statement of accounts of Prakash Auto Gas Delhi maintained by the defendant no1 i.e. Mars International Auto Corporation EX DW2/1 clearly shows the amount of Rs. 1,19,832/ and Rs. 33,704.94 paid to the confederation of Indian Industry were CS no. 2572/09 page no. 39 of 44 credited in the account of the plaintiff and shows closing balance of 3,12,854.06/. During the course of arguments, it has been urged on behalf of the defendant that cheque was issued to pay the amount due from the plaintiff which was dishonoured and a complaint was filed against the plaintiff under section 138 of Negotiable Instrument Act, before the court of CJM, Hisar Haryana and present suit is a counter blast to the criminal complaint filed by the defendants.
66. In view of the discussion made above and evidence placed on record, it can be easily concluded that plaintiff has failed to establish that he is entitled to recover the suit amount from the defendants. Hence, this issue is decided against the plaintiff and in favor of the defendants.
67. ISSUE NO. 2: Whether the plaintiff has no cause of action ? OPD The onus to prove this issue was on the defendants and they have made a bald statement in the WS that there is no cause of CS no. 2572/09 page no. 40 of 44 action arose in favour of the plaintiff but nowhere it has been stated in the WS as well as in the evidence how the plaintiff has no cause of action to file the present suit. The case of plaintiff is that he is the proprietor of M/s Prakash Auto Gas and defendant no. 1 is the partnership firm and manufacturer of electric scooter under the Brand name of Mars Electric Scooters and for launching of its product in Delhi region, defendant no. 1 through defendant no. 2 appointed the plaintiff as an agent for promotion of sale in the market of Delhi region. It has been further averred in the plaint that as per the understanding and the commitments made by the defendant no. 2 to the plaintiff, all the expenses incurred by the plaintiff for the promotion of the sale by advertisement and other means were to be reimbursed to the plaintiff and defendants have also agreed to pay the rent of the premises for the showroom to the plaintiff as per their understanding. Plaintiff has filed the present suit is for the recovery of expenses towards the CS no. 2572/09 page no. 41 of 44 promotion of the sale which were alleged to be reimbursed by the defendants along with recovery of the arrears towards rent of the showroom and for damages to the tune of Rs.10 lacs for the loss of the business, reputation and goodwill of the plaintiff.
68. From the bare reading of the plaint, the averments made in the plaint shows cause of action to file the present suit. While determining as to what would constitute the cause of action, the Hon'ble supreme Court in the case titled as Om Prakash Shrivastava Vs. Union of India 2006 (6) SCC 207 has observed in paras 12 and 13 and relevant portion has been reproduced as under:
"12. The expression 'cause of action has sometimes been employed to convey the restricted idea of facts or circumstances which constitute either the infringement or the basis of a right and no more. In a wider and more comprehensive sense, it has been used to denote the whole bundle of material facts, which a plaintiff must prove in order to succeed. These are all these essential facts without the proof of which the plaintiff must fail in his suit.
13. The expression "cause of action" is generally CS no. 2572/09 page no. 42 of 44 understood to mean a situation or state of facts that entitles a party to maintain as action in a court or a tribunal; a group of operative facts giving rise to one or more bases of suing : a factual situation that entitles one person to obtain a remedy in court from another person."
69. In view of the averments made in the plaint, facts of the case and discussion made above and relying upon judgment tilled as Om Prakash Shrivastava Vs. Union of India (supra), I am of the view that plaint shows cause of action to file the present suit and on the other hand defendants have to establish that no cause of action arose in favour of the plaintiff to file the present suit. Counsel for the defendants has not even advanced any argument in this regard at the time of final arguments.
70. In view of the discussion made above and relying upon the judgment, it can be easily said that plaintiff has a cause of action to file the present suit. Accordingly, this issue is decided in favour of the plaintiff and against the defendants.
CS no. 2572/09 page no. 43 of 44
71. In view of the findings given on the abovesaid issue and especially on the issue no.1 which has been decided against the plaintiff holding that he is not entitled for recovery of the suit amount. Suit of the plaintiff fails and is hereby dismissed accordingly. Parties are left to bear their own cost. Decree sheet be prepared accordingly. File be consigned to record room.
Announced in the Open Court (SUNIL RANA) On this 18.05.13 ADJII(N/W): ROHINI : DELHI CS no. 2572/09 page no. 44 of 44