Delhi District Court
Milano International (India) Pvt. Ltd vs Union Of India on 29 June, 2012
IN THE COURT OF JITENDRA KUMAR MISHRA, ADDL.
DISTRICT JUDGE CENTRAL-09: TIS HAZARI COURTS, DELHI
CS N0. 208/05.
UID No. 02401C5091052004.
Milano International (India) Pvt. Ltd.
C-4, Community Centre
Naraina Vihar
New Delhi-110 028
........... Plaintiff
Versus
1. Union of India
(Through Secretary,
Ministry of Commerce & Industry)
Udyog Bhawan
New Delhi-110 011.
2. The Director General of Foreign Trade
O/O Directirate General of Foreign Trade
Ministry of Commerce & Industry
Govt. of India, Udyog Bhawan
New Delhi-110 011.
......... Defendants
Date of institution of suit : 23.10.2002
Date of reserving for judgment : 02.06.2012
Date of judgment : 29.06.2012
JUDGMENT
1. This is a suit for recovery of Rs. 7,17,928/- filed by the plaintiff.
2. Briefly stated the facts of the case are :
a) Plaintiff is a company incorporated under the Companies Act, 1956. Sh. Manoj Lal is the director and authorized signatory of the CS No. 208/05 Page 1 plaintiff. He has been authorized by the plaintiff and is competent to sign, verify and institute the present suit.
b) Defendant no. 1 through its Ministry of Commerce and Industry, formulates the policy with respect to exports and foreign trade from India. Defendant no. 2 implements the policy laid down by defendant no. 1.
c) Plaintiff is a manufacturer and exporter of garments for the past more than two decades. To promote the exports and to earn the foreign exchange, defendant no. 1 offered various incentives to the exporters from time to time. In the year 1990-91, defendants framed a policy where under an exporter was given licences, known as REP licences. An exporter can use the REP licences, issued in his favour either for importing any material required to promote its export and other business or trade the same in the open market and earn premium therefrom.
e) For the goods exported during the quarter from January to March 1991 the plaintiff became entitled to REP licence worth Rs.
35,53,060/- and submitted its application for grant of REP licence to the Central Licencing Authority (CLA, in short), functioning under defendant no. 2 vide plaintiff's letter no. MIPL/REP/JM-91/AM-92 dated 28/08/1991. While submitting the said application which was duly received by the CLA, vide letter no. RMG-83/JM-91/92/AM-91/REP- B/CLA/75 dated 23/06/1992, the plaintiff complied with the procedure laid down for submitting such application and also submitted all relevant documents with the exception of provision certificate in respect of 37 shipping bills. This was because the plaintiff did not receive the CCS in respect of these 37 shipping bills from the appropriate agencies. These shipping bills were, included in the said application as per the directive given by the defendants vide circular CS No. 208/05 Page 2 no. 23/91 dated 31/07/1991.
f) That the CLA, vide letter no. RMG-83/JM-91-92/AM-91/REP- B/CLA/751 dated 23/06/1992 issued partial licence no. 2149398 for Rs. 14,65,800/- against the total licence of Rs. 35,53,060/- and the licence for the balance value was to be issued after the plaintiff submitted the provisional certificate.
g) Vide letter no. MIPL/REP/JM-91/AM-92/404-A dated 07/08/1992, the plaintiff submitted the provisional certificate for the balance 37 shipping bills whose FOB value was Rs. 1,04,35,573/- to the CLA, which was duly received and acknowledged by the CLA vide receipt no. 13210 dated 11/08/1992. The defendants, however, did not issue the licence worth Rs. 20,87,260/- despite several reminders and personal interviews with the officials of defendant no. 2.
h) In the meantime, defendant no. 2 issued a circular no. 11/93 dated 05/05/1993 wherein it was stated that in respect of cases, where licences are still to be issued and pending against exports made and proceeds thereof had been realized against such exports prior to 01/03/1992, defendants would pay 20% premium instead of issuing licences and the defendants further advised that all exporters, who fulfilled the above criteria, to file their claims with the respective licencing authority as per prescribed format.
i) Plaintiff fulfilled the conditions laid down in circular no. 11/93 dated 05/05/1993 and as per the directions of the defendants, the plaintiff filed its claim vide application no. MIPL/404-A/REP- JM-91/AM-92 dated 31/05/1993, for payment of Rs. 4,17,400/- being the 20% premium payable to the plaintiff in respect of REP licence. Defendants despite receipt of above letters neither paid the above amount due to the plaintiff nor sent any communication in respect thereof.
CS No. 208/05 Page 3
j) The plaintiff met various officials of the defendants. The plaintiff
also met Sh. Munshi Ram, Assistant Director of defendant no. 2 on 02/08/1994 and again on 12/09/1998 whereupon it was informed that the certificate submitted by the plaintiff on 11/08/1992 could not be located in the file and, therefore, advised the plaintiff to sent photocopy of these provisional certificate immediately for processing the case. Accordingly, at the request of Sh. Munshi Ram, Assistant Director, the plaintiff personally handed over the photocopies of those provisional certificates to him. Thereafter, neither any payment nor communication from the defendants, as such the plaintiff approached the Director General, FIEO once again vide letter dated 26/09/95 to intervene the matter. Finding no response, the plaintiff once again wrote to Joint Director, defendant no. 2 on 13/03/1996 and requested for settlement of the long outstanding issues, but even to this no communication was received.
k) Thereafter, plaintiff met various officials of the defendant and wrote number of letters to the defendants from 10/06/1996 to 15/12/1996.
l) Plaintiff met Sh. L. B. Singhal, Joint Director of defendant no. 2 who advised the plaintiff that vide circular issued in 1994 and 1996, he had already informed all concerned that all pending cases except those where litigation was pending, where the defendants have to pay premium to the exporters, were closed and hence nothing could be done in the subject.
m) The plaintiff again took up the matter with FIEO who once again forwarded the papers to defendant no. 2 and subsequently on 25/04/2001, the plaintiff met defendant no. 2 and explained the entire case once again. However, there was no further communication from the defendants.
CS No. 208/05 Page 4
n) A notice dated 22/02/2002 was also issued to demand payment
of the outstanding amount on behalf of the plaintiff.
3. Written statement filed by the defendants wherein objection regarding limitation is taken. It is denied that the plaintiff became entitled to REP licence as stated. It is further denied that plaintiff has complied with the procedure laid down for submitting such application or also submitted relevant documents with the exception of provisional certificate in respect of 37 shipping bills. It is stated that the plaintiff was eligible for CCS against their export during JM.91 and since CCS (cash compulsory scheme) was not granted to the plaintiff, they were also not eligible for REP licence. It is further stated that export made during January-March, 1991 were eligible for CCS as well as REP licence as per procedure and rejection of CCS automatically debars the plaintiff from REP licence. It is further denied that the plaintiff submitted provisional certificate for the balance 37 shipping bills. It is also denied that the plaintiff met Sh. Munshi Ram, Assistant Director of defendant no. 2 on 02/08/1994. It is stated that Sh. Munshi Ram was not the Assistant Director as stated by the plaintiff and he was holding the post of Foreign Trade Development Officer (Controller of Imports & Exports). It is further denied that plaintiff was not authorized to meet Sh. Munshi Ram as Mr. Munshi Ram, FTDO was not competent authority to hold interviews. It is not denied categorically that the information provided by Sh. L. B. Singhal, Joint Director to the plaintiff. Defendant further denied the liability to make any payment to the plantiff.
4. Plaintiff filed replication to the written statement wherein the plaintiff reiterated and affirmed the contents made in the plaint.
5. My ld predecessor by order dated 30/09/2004 framed following issues :
"i) Whether the plaintiff is entitled to decree for a sum of Rs.
7,17,928/- along with interest @ 24% p.a. ? OPP.
CS No. 208/05 Page 5
ii) Whether the suit is barred by limitation ? OPD.
iii) Relief.
6. Hon'ble Delhi High Court vide judgment in RFA No. 614/06 passed on 19/04/2012 remanded the case to give finding with respect to issue no. 1 while setting aside the finding given by my ld predecessor for issue no. 2. The Hon'ble High Court held in para 13 of the above mentioned judgment :
"13. In view of the above discussion, I set aside the impugned judgment dated 22.7.2006 holding the suit not to be barred by limitation. The suit is held within limitation and the matter is remanded back to the trial Court to give its findings with respect to issue No. 1. I may hasten to clarify, that I have not made any observation on merits for or against any of the parties and issue No. 1 will be decided by the trial Court uninfluenced by the observations which have been made in the present judgment."
7. To prove its case Sh. Manoj Lal i.e. authorized signatory of the plaintiff appeared as PW1. He tendered his evidence by way of affidavit. This witness was cross-examined by the ld counsel for the defendants. In defence Sh. Jai Kant Singh, Joint Director General of Foreign Trade in the office of Zonal Joint Director has appeared as DW1. He tendered his evidence by way of affidavit Ex. DW1/A. This witness was cross- examined by the ld counsel for the plaintiff at length. Thereafter, both sides closed their respective evidences.
8. I have gone through the entire record of the case including pleadings of the parties, evidences led by the parties and documents proved by the parties during trial. My finding regarding issue no. 1 is :
9. Issue no. 1 Issue No. 1 : Whether the plaintiff is entitled to decree for a sum of Rs. 7,17,928/- along with interest @ 24% p.a. ?
OPP.
The contents of affidavit of PW1 are similar to the averments made in the plaint. During cross-examination, it is stated by PW1 that he did CS No. 208/05 Page 6 not remember how many provisional bills were submitted by the plaintiff in the year 1995. It is further stated that out of Rs. 35 lacs, the plaintiff had received REP licence worth Rs. 14.15 lacs approximately. He has further stated that the only proof regarding submitting of the bills is Ex. PW1/7. This document is perused. This is a letter written by the plaintiff to the defendant bearing date 07/08/1992. It is mentioned in the letter that the plaintiff received partial REP licence and the balance was held up for want of provisional certificates. It is further stated in this document that 9 provisional certificates covering 24 S/Bills were enclosed and for the balance 12 numbers bank certificates along with P/Copy of the Tokens are enclosed. By ink details of bills are also mentioned. He has further stated that plaintiff had received Ex. PW1/5. During further cross-examination a further suggestion was given that the plaintiff had taken the premium after the closure of the scheme and the said suggestion was denied. Except this challenge, there is no challenge regarding any of the averment of PW1 by the defendants. It is not the case of the defendants during cross- examination of PW1 that Ex. PW1/7 was not received by the defendants.
10. DW1 in para 6 of Ex. DW1/A stated that the plaintiff submitted an application for granting of REP licence against export of readymade garments with certain documents. It is further submitted that they had submitted certificate against only 22 shipping bills. It is further stated that the scheme was closed in June, 1991 and as per the averment and document disclosed,the plaintiff company submitted remaining shipping bills for REP licence for 07/08/1992. It is further stated in para 9 of Ex. DW1/A that every licence issued by licencing authority has period of validity. He has further stated that plaintiff did not submit the application as per the procedure prescribed and did not submit CS No. 208/05 Page 7 before the appropriate authorities to decide the eligibility of premium. He further stated that the defendant had never showed the plaintiff regarding payment of premium. It is further stated that the plaintiff is not entitled to any premium because plaintiff had not approached the appropriate authority in time. During cross-examination, it is admitted by DW1 that plaintiff is manufacturer and exporter of garments. It is admitted that certain incentives were given to the plaintiff to increase the export of garments. It is further admitted that the plaintiff was given the licence known as replinishment licence (REP). It is further stated that REP is given to replinish the exporter with the raw material which has gone into the export market. He has further stated that the plaintiff was given REP in 1991-92. However, from the record brought by the witness, he was unable to say as to whether in the year 1991-92, the plaintiff was entitled for issuance of REP or not. He has further admitted that vide letter dated 07/08/1992, the plaintiff had submitted the provisional certificate for the balance 37 shipping bills whose FOB value was Rs. 1,04,35,575/- to the CLA which was duly received by the CLA. However, he was not able to state whether any document was attached with this letter. He has further stated that the original letter dated 07/08/1992 is not available with the defendant (i.e. Ex. PW1/7). He has further stated that it was not possible to say as to whether any document is mentioned for the original letter number or not. He has further stated that it is also not possible to state whether any document in fact was sent by the plaintiff to the defendant along with this letter. He has further stated that when the plaintiff had insisted, he was asked to supply the copy of letter dated 07/08/1992 and the copy is available in his record. He has further admitted that along with copy of letter dated 07/08/1992, the plaintiff had supplied the copies of all those documents reference of which find mentioned in the copy available in CS No. 208/05 Page 8 his record. Letter is again perused. This letter bears receipt no. 13210 dated 11/08/1992.
11. The witness put to the question that the plaintiff had complied with all the requirements/formalities of the circular dated 26/04/1991 issued by F.I.E.O. and witness stated that since he was not having the record, therefore, he was not able to admit or deny the suggestion. He has further stated that he personally did not know Sh. Munshi Ram, Assistant Director of the defendant. It is further put to the witness that an amount of Rs. 4,17,000/- being premium amount payable on REP licence to the plaintiff had not been paid by the defendant and the witness replied yes but since the original documents were not available, he was not sure whether any original documents provisional certificate of export etc. have been filed by the plaintiff or not.
12. Thus, it is the admitted case of the defendant that an amount of Rs. 4,17,400/- being premium amount paid on REP licence payable to the plaintiff was not paid by the defendant. However, it is the case of the witness that he was not sure whether original documents, provisional certificate of the export was not filed by the plaintiff. On the record, there is another document which is Ex. PW1/3 wherein it is mentioned provisional certificate covering 22 shipping bills (10 nos.) were received. This letter bears date of 28/08/1991. To prove the receipt, this letter bears receipt no. 125110, dated 28/08/1991 and the plaintiff also filed gate pass issued for the said date which is Ex. PW1/4. Ex. PW1/7 also proves that 9 provisional certificates were also enclosed which is dated 07/08/1992 as mentioned herein above. There is another letter issued by Federation of Indian Export Organization which is Ex. PW1/9 and it bears the date 11/05/1993 wherein it is stated that the Director General of Foreign Trade issued REP circular no. 11/93, dated 05/05/1993 notifying the detailed procedure on this issue. This CS No. 208/05 Page 9 letter was issued by Sh. K. M. Dev Rajan, Director General of F.I.E.O. and this official body has been set up under Ministry of Commerce i.e. defendant no. 1. Thus, in view of this Ex. PW1/9, the claim of the defendant that the scheme was closed in the year 1991-92 is incorrect. It is the case of DW1 in para 8 of Ex. DW1/A that the scheme was closed in June, 1991 whereas Ex. PW1/9 issued by Federation of Indian Export Organization i.e. Body set up by defendant no. 1 states contrary. In this letter, it was further stated that the scheme for premium will commence from 15/05/1993 and the last date for filing was 31/05/1993 and the payment will be made by the authorities concerned before 31/08/1993. During cross-examination, there is no challenge to this letter by the defendant to PW1.
In para 3 of Rajinder Pershad (dead) by LRs. Vs. Smt. Darshana Devi' 93 (2001) DLT 1 (SC) held that:
'.........There is an age old rule that if you dispute the correctness of the statement of a witness you must give him opportunity to explain his statement by drawing his attention to that part of it which is objected to as untrue, otherwise you cannot impeach his credit. In State of U. P. v. Nahar Singh (dead) and Ors. III (1998) (3) SLT 510=1998(3) SCC 561, a Bench of this Court (to which I was a party) stated the principle that Section 138 of the Evidence Act confers a valuable right to cross-examine a witness tendered in evidence by opposite party. The scope of that provision is enlarged by Section 146 of the Evidence Act by permitting a witness to be questioned, inter alia, to test his veracity. It was observed:
"The oft-quoted observation of Lord IIcrschell, L.C. In Brownev. Dunn clearly elucidates the principle underlying those provisions. It reads thus:
'I cannot help saying, that it seems to me to be absolutely essential to the proper conduct of a cause, where it is intended to suggest that a witness is not speaking the truth on a particular point, to direct his attention to the fact by some question put in cross-examination showing that that imputation is intended to be made, and not to take his evidence and pass it by as a matter altogether unchallenged, and then, when it is impossible for him to explain, as perhaps he might have been able to do if CS No. 208/05 Page 10 such questions had been put to him, the circumstances which, it is suggested, indicate that the story he tells ought not be believed, to argue that he is a witness unworthy of credit. My Lords, I have always understood that if you intend to impeach a witness, you are bound, whilst he is in box, to give an opportunity of making any explanation which is open to him; and, as it seems to me, that is not only a rule of professional practice in the conduct of a case, but it is essential to fair play and fair dealing with witnesses."
Thus, if there is no cross examination by the plaintiff to the statement of this witness that statement is deemed to be admitted by the plaintiff.
In a case titled as 'Srichand and Shivan Das Vs. The State 28 (1985) DELHI LAW TIMES 360 it has been held in para 6:
"The law is well settled that where the evidence of a witness is allowed to go unchallenged with regard to any particular point it may safely be accepted as true."
Thus, it is an admitted fact of both the defendants and this letter contradicts the entire written statement as well as the evidence of both the defendants. It is again the case of the defendants that they have already submitted certificate against 22 shipping bills but defendants have not denied submissions of further 24 shipping bills vide Ex.PW1/7. This letter has also not been challenged by the defendant during cross-examination of PW1. Thus, entire defence put by the defendants is contradictory to the documents filed by the plaintiff and during cross-examination it is admitted by DW1 that an amount of Rs. 4,17,400/- being premium amount payable on REP licence to the plaintiff had not been paid by the defendants.
13. Thus, the plaintiff is successfully able to prove the claim for the amount of Rs. 4,17,400/- and, therefore, the plaintiff is entitled for this amount.
14. However, the plaintiff further claimed interest on this amount @ 24% p.a. but the plaintiff is not able to bring on the record any document CS No. 208/05 Page 11 which entitled the plaintiff to put its claim for the interest. Thus, in my view the plaintiff is not entitled for the interest till date of filing of the suit. However, this court is of the considered opinion that since it was the defendants who were responsible for not making payment of this amount to the plaintiff and the plaintiff is claiming the interest as a part of the commercial activity, therefore, keeping in view Section 34 of CPC, the plaintiff is entitled for interest on this amount @ 6% p.a. from the date of filing of the suit till realization. Plaintiff is also entitled for proportionate costs of the suit. Thus, issue no. 1 is answered in favour of plaintiff with these directions and against the defendants.
15. Issue No. 3Relief In view of the observation made herein above, the suit of the plaintiff is decreed in favour of the plaintiff and against the defendants for a sum of Rs. 4,17,000/- along with interest @ 6% per annum from the date of filing of the suit till realization. Plaintiff shall also be entitled for proportionate cost of the suit. Decree sheet be prepared accordingly. File be consigned to record room.
Announced in the open (Jitendra Kumar Mishra) court on 29/06/2012. Additional District Judge-09 Central District, Tis Hazari Courts Delhi CS No. 208/05 Page 12 CS No. 208/05 29/06/2012 Present : None Vide separate judgment announced in the open court today, the suit of the plaintiff is decreed in favour of the plaintiff and against the defendants for a sum of Rs. 4,17,000/- along with interest @ 6% per annum from the date of filing of the suit till realization. Plaintiff shall also be entitled for proportionate cost of the suit. Decree sheet be prepared accordingly. File be consigned to record room.
(Jitendra Kumar Mishra)
Additional District Judge-09
Central District, Tis Hazari Courts
Delhi/29.06.2012
CS No. 208/05 Page 13