Delhi District Court
Ms Kritika Soni vs M/S Livguard Energy Technologies Pvt ... on 5 June, 2024
IN THE COURT OF SH. AJAY GUPTA
DISTRICT JUDGE (COMMERCIAL COURT)-05
TIS HAZARI COURTS, WEST: DELHI
CNR No. DLWT01-007660-2019
Case No. CS(COMM)/450/2019
Ms. Kritika Soni
Proprietor
M/s Colordrop Solutions
Registered Office:
F-76, Ashok Vihar Phase-I,
Delhi-110052
....PLAINTIFF
Versus
M/s Livguard Energy Technologies Pvt. Ltd.
Registered Office:
WZ-106/101, Rajouri Garden Extn.,
New Delhi-110027
Also at:
Corporate Office:
Plot No.221, Udyog Vihar Phase-I,
Gurgaon-122016
Haryana
....DEFENDANT
Date of Institution of case : 19.09.2019
Date of Arguments : 10.05.2024
Date of pronouncement of Judgment : 05.06.2024
JUDGMENT
PLAINTIFF'S CASE
1. Plaintiff has filed the present suit for recovery of Rs.23,02,068/- alongwith pendentelite and future interest and cost on the following averments :-
Case No. CS(COMM)/450/2019 Page No. 1 of 49(i) that the plaintiff is the sole proprietor and carrying on her business in the name of M/s Colordrop Solutions. Defendant had been dealing with plaintiff and had been availing the services of the plaintiff.
Defendant had placed a service order (vide Service Order No. 1238000138 dated 07.04.2017) with the plaintiff for an amount of Rs.9,15,908/- (Rupees Nine lac fifteen thousand nine hundred and eight only) which includes the VAT of 12.50% as was applicable at the relevant time of placing the said order. As per agreement, the payment was to be made within 30 days. The defendant had placed the said order for installation of LG Mass Signages in Delhi.
(ii) that the plaintiff completed the said service order and raised the invoice No.AUG/17-18/04 dated 18.8.2017 an amount of Rs. 10,42,099.20P (Rupees ten lakh forty two thousand ninety nine and paise twenty only) which includes 28% SGST & CGST.
(iii) that besides the said service order, the defendant had placed another service order with the plaintiff vide S.O.No. 1238000291 dated 29.07.2017, for the total amount of Rs.5,08,280/- (Rupees five lakh eight thousand two hundred and eighty only) for LG Branding in Haryana. The defendant agreed that the payment will be made in 30 days.
Case No. CS(COMM)/450/2019 Page No. 2 of 49(iv) that the plaintiff completed the aforesaid second service order and against the same, plaintiff raised the Invoice No.AUG/17-18/05 dated 19.08.2017 for an amount of Rs.6,50,598.40 (Rupees six lakhs fifty thousand five hundred ninety eight and paise forty only) which includes 28% SGST/CGST.
(v) that as per terms and conditions, the payment was to be made within 30 days, else interest @ 18% p.a was to be charged. Both the said invoices (amounting to Rs.16,92,697.60P) were duly received by the defendant, however, defendant failed to make the payment of these invoices. The defendant also availed the benefit of GST against these two invoices and also verified the work performed by the plaintiff. But in order to delay and withhold the legal dues of plaintiff, defendant sent a letter dated 05.10.2017 on the basis of frivolous story that too in regard to only one invoice dated 18.08.2017. Defendant mentioned in the said letter that they have certain queries and in this regard they require one on one interaction with the plaintiff. Plaintiff acceded to the said request and requirement of defendant, however, there was never any query from the plaintiff in this regard and it was only a malafide and wrongful act on the part of defendant.
Case No. CS(COMM)/450/2019 Page No. 3 of 49(vi) that it is a co-incident that Sh. Santul Purang, the husband of the plaintiff was working with defendant company but he had no concern with the firm or business of the plaintiff and the said service orders were given by defendant to the plaintiff's firm which were completed by the plaintiff to the satisfaction of defendant and it was also verified and confirmed by defendant, however, defendant turned dishonest and wanted to usurp the legal dues of plaintiff, therefore, they adopted tactics to harass/threaten the plaintiff and they even harassed the husband of plaintiff and forced and compelled him to resign from defendant company. The defendant without any justifiable reason asked the plaintiff to appear in person and in case of failure to appear, she was threatened that her payments will not be released. Thus, she deputed her authorized person to appear before defendant but defendant avoided to raise their query with authorized person of plaintiff and refused to release the payment of the plaintiff.
(vii) that since defendant was withholding the aforesaid legal dues of plaintiff without any justification therefore, plaintiff got served the defendant with a legal demand notice dated 11.01.2019. Defendant did not make the payment and instead, they sent false and frivolous reply dated Case No. CS(COMM)/450/2019 Page No. 4 of 49 15.03.2019. Thus, on the basis of these averments, plaintiff has prayed that a decree for a sum of Rs.23,02,068/- alongwith pendente-lite and future interest @ 18 % p.a. alongwith cost of the suit may be passed against the defendant company.
DEFENDANT'S CASE
2. Defendant company filed its Written Statement and opposed the claim of the plaintiff on the basis of following averments:-
Preliminary Objections i. That plaintiff has not done any job or services as alleged and she has raised false and fictitious invoices. It is stated that the documents filed by plaintiff are false, fictitious and manipulated and even contrary to the case of plaintiff, thus, no cause of action ever arose in favour of plaintiff, therefore, the present suit filed by plaintiff is without any cause of action and same is liable to be rejected u/O 7 rule 11 CPC.
ii. that Plaintiff has not approached this Court with clean hands and she has suppressed and concealed the true and material facts from this Court and she has misrepresented the true facts from the courts. Therefore, she is not entitled to any relief.Case No. CS(COMM)/450/2019 Page No. 5 of 49
iii. that this court does not have territorial jurisdiction to entertain the present suit as no cause of action arose within the territorial jurisdiction of this Court.
Preliminary submissions iv. that the plaintiff is not engaged in any business activities and she was acting in collusion and in criminal conspiracy with her husband namely Mr. Santaul Purang to cheat and defraud the defendant. Mr. Santaul Parang was working as a Senior Executive- Marketing with the defendant company and to cheat and defraud the company, he by abusing his position in the company introduced M/s Colordrop Solution as a vendor for doing the marketing job. By abusing his position, he of his own, placed certain orders with M/s Colordrop Solutions without taking any formal approvals from the senior management of the company. He created M/s Colordrop Solutions in the name of his wife (the plaintiff herein) and it was he who was controlling the affairs of said Colordrop Solutions as later on, it was found that the said firm was incorporated while he was in the job of the defendant company. Prior to the placing of the said service orders, the said firm had no business transactions whatsoever, and even after the said orders, the Colordrop Solutions did not have any business with any third party. The Case No. CS(COMM)/450/2019 Page No. 6 of 49 incorporation of the said firm in the name of the plaintiff by the husband of the plaintiff was only to defraud and cheat the defendant company.
v. that in furtherance of their criminal conspiracy, the husband of the plaintiff (who was then working as senior executive-marketing) by abusing and misusing his official capacity, unauthorizedly issued certain POs of hefty sum to his own firm M/s Colordrop Solution. Thereafter, Mr. Santaul Purang through his wife raised false invoices in the name of defendant company and alongwith the said invoices, fake, false and fabricated pictures and documents were annexed while no such work was ever done by the said firm. The husband of the plaintiff despite knowing that against these invoices no service has been rendered and no job has been done yet in order to cheat and defraud the defendant, the husband of the plaintiff approved the said invoices and forwarded the same to the accounts department of the company.
vi. that after defendant came to know about the aforesaid Modus Operendi, the husband of plaintiff was confronted with the aforesaid facts and on the said confrontation, the husband of the plaintiff admitted his mistake with the defendant company and tendered an unconditional apology and resigned from the job and Case No. CS(COMM)/450/2019 Page No. 7 of 49 assured that no action would be taken against the defendant company qua the said invoices as the said invoices are unlawful, false and bogus besides being void ab initio and therefore, same calls for no payment. Defendant accepted the unconditional apology as well as resignation of the husband of the plaintiff. After observing that defendant has not taken any action for a considerable time, the plaintiff and her husband raised unlawful demand from the defendant, though whenever such demands were raised it was made clear to the plaintiff that she was guilty of criminal breach of Trust, cheating and fraud therefore, nothing was legally payable to the plaintiff.
vii. that in regard to the illegally obtained PO, it is stated that the plaintiff was grossly dishonest and deficient in executing of the work order. As per the audit report, the plaintiff did not complete the job of installing boards and thus, even otherwise, Plaintiff is not entitled to any payment against the forged invoices. On the contrary, it is the defendant company who has suffered huge losses because of the fraudulent acts and deeds of the plaintiff. The marketing work was assigned, though fraudulently, yet the plaintiff failed to complete the work because of which the defendant company suffered huge losses as due to lack of marketing/boards, the sales of the defendant company Case No. CS(COMM)/450/2019 Page No. 8 of 49 was negatively impacted and it caused huge losses due to less sale. The defendant is assessing the damages/loss suffered by them and would initiate appropriate legal proceedings for the recovery of the same against the plaintiff and her husband.
Reply on Merits viii. that while replying on merits, the defendant has reiterated all the averments made in their preliminary objections and preliminary submissions. It is also stated that there was never any lawful contract/transactions between the parties. Thus, defendant has sought dismissal of the suit filed by the plaintiff.
3. On the basis of the pleadings of the parties following issues were framed by Ld. Predecessor on 27.07.2021:-
ISSUES
1. Whether plaintiff is entitled to recovery of Rs.23,02,068/-? OPP
2. Whether this Court lacks territorial jurisdiction to try the present suit? OPD
3. Relief EVIDENCE LED BY PARTIES
4. In order to prove her case, plaintiff has examined three witnesses. Plaintiff has examined herself as PW1. She Case No. CS(COMM)/450/2019 Page No. 9 of 49 filed her affidavit Ex.PW1/1 on the similar lines of the averments made in the plaint. Besides her affidavit (Ex.PW1/1), PW1 has tendered the following documents in her evidence:-
(i) Copy of Aadhar Card as Ex.PW1/A (OSR).
(ii) Copy of Pan Card as Ex.PW1/B(OSR).
(iii)Copy of Registration Certificate of proprietorship firm of plaintiff as Ex.PW1/C (objected to the mode of proof).
(iv) Copy of service order as Ex.PW1/D (Objected to the mode of proof).
(v) Copy of tax invoice dated 18.08.2017 as Ex.PW1/E.
(vi) Copy of service order dated 29.07.2017 as Ex.PW1/F (objected to the mode of proof).
(vii) Copy of invoice dated 19.08.2017 as Ex.PW1/G.
(viii) Copy of complete particulars of parties where flex boards were installed as Ex.PW1/H (Colly.) (objected to the mode of proof).
(ix) Copy of photographs showing installed flex boards as Ex.PW1/I (colly.) (objected to the mode of proof).
(x) Original letter dated 05.10.2017 as Ex.PW1/J.
(xi) Copy of Legal notice as Ex.PW1/J.
(xii) Postal receipts as Ex.PW1/K.
(xiii) Reply to legal notice as Ex.PW1/M.
(xiv) Copy of statement of account and TDS form 26 AS as Ex.PW1/N (Colly.) (Objected to the mode of proof).
(xv) Copy of certificate u/s 65-B of Indian Evidence Act as Ex.PW/1O (Objected to the mode of proof).
4.1 PW2 Sh. Santul Parang is the husband of plaintiff. In his affidavit Ex.PW2/A, he has deposed regarding placing of orders by the defendant and receipt of invoices by the Case No. CS(COMM)/450/2019 Page No. 10 of 49 defendant. He further deposed that defendant has failed to make the payment of the said invoices. PW2 has relied upon the documents which have been tendered by PW1 in her evidence.
4.2 PW3 Sh. Mashkoor Ahmed Chaudhary is the Proprietor of M/s Ad Station. In his affidavit Ex.PW3/A, he deposed that he was engaged by the plaintiff as a vendor for installation of LG Mass Sinage in Delhi and LG Branding in Haryana. He completed the said work against both the orders received by the plaintiff from the defendant. He also deposed that plaintiff has not cleared his dues and outstanding amount. He deposed that he knew that plaintiff's payment has been withheld by the defendant due to which plaintiff could make his payment.
4.3 After examination of aforesaid witnesses plaintiff's evidence was closed and the case was fixed for defendant's evidence and in their defence, defendant company examined two witnesses. Defendant examined Sh.Satish Kumar Sharda, General Manager (Finance & Accounts) as DW1. In his affidavit Ex.DW1/A, he has reiterated the contents of the written statement and relied upon the following documents:-
(i) Identity Card/Aadhar Card as Ex.DW1/1.
(ii) Appointment letter dated 16.06.2024 (seems there is a typing error as undisputedly the correct Case No. CS(COMM)/450/2019 Page No. 11 of 49 date is 16.06.2014) of the husband of the plaintiff as already Ex.PW2/D1.
(iii) Print out of email dated 04.04.2017 alongwith registration form submitted by M/s Colordrop Solution as Ex.DW1/2 Colly.) (objected to - mode of proof).
(iv) Email dated 22.03.2017 whereby Sh Santul Purang registered as a vendor namely Adfox as Ex.DW1/3.
(v) Computer generated print of LinkedIn web page of M/s Colordrop Solution which bears the photograph of Mr. Santul Purang already Ex.PW1/D1.
(vi) Invoice dated 18.08.2017 bearing signature of Mr. Santul Purang already Ex.PW2/D2.
(vii) True print of email dated 22.09.2017 as Ex.DW1/4.
(viii) Letter dated 25.09.2017 already Ex.PW1/D2 and resignation letter as already Ex.PW1/D3.
(ix) Photographs (at page no.89-154) of WS as Ex.DW1/5.(Objected to the mode of proof).
(x) Copy of email dated 22.11.2017 and 26.12.2017 Ex.DW1/6 (Colly.) as DW1/6 (colly).
(xi) Email dated 21.01.2019, 14.2.2019, 22.02.2019 and 27.02.2019 already Ex.PW1/D4 (Colly).
(xii) Reply dated 15.03.2019 of legal notice as Ex.DW1/7.Case No. CS(COMM)/450/2019 Page No. 12 of 49
(xiii) Ledger statement in respect of plaintiff as Ex.DW1/8.
(xiv) Certificate u/s 65-B of I.E. Act as Ex.DW1/9.
4.4 DW2 Sh. Madhu Sudan is the Dy. General Manager (Service Operations) of defendant. In his affidavit Ex.DW2/A, he deposed that he alongwith his teammates carried out the physical audit of installation of boards by the plaintiff in Delhi and Haryana and clicked the photographs of the sites where the alleged photographs were either installed or not installed. The photographs (at page 89-154) of WS are Ex.DW2/3 (Colly). DW2 has prepared the zone wise report (Ex.DW2/4 (Colly.)) and submitted the same to the Senior Manager through email.
5. I have heard the Ld. Counsel for the plaintiff as well as Ld. Counsel for the defendant and perused the record carefully. Ld. Counsel for the plaintiff has relied upon the Judgement titled National Insurance Co. Ltd. Vs. Smt. Guddi Bai etc (Misc. Appeal no. 1699 of 2019). Ld. Counsel for the defendant has relied upon the Judgments titled State of West Bengal Vs. B.K.Mondal & Sons MANU/SC/0114/1961, Punjabai Bhilasa Vs. Bhagvandas kisandas MANU/MH/0178/1029, Nuli Kanada Rao & Ors. Vs. Tetali Sriranga Venkata Ramalinga Reddy MANU/AP/0155/ 166, Nanduri Saradamba Vs. Parakala Pattabhiramayya MANU/TN/0084/1930, Avudayappa Pillai Vs. T.S.Thillai Case No. CS(COMM)/450/2019 Page No. 13 of 49 Thandavaraya Pillai MANU/TN/0451/ 1927. My issues wise finding is as under:-
ISSUE NO.1
1. Whether the plaintiff is entitled to recover Rs.23,02,068/- from defendant?
OPP
6. In the present case, plaintiff has claimed that she is the proprietor of M/s Colourdrop Solutions (engaged in the business of Marketing) and defendant had been dealing with the plaintiff and availing the services of the plaintiff firm. It is also the case of the plaintiff that defendant company had given two work orders (Ex.PW1/D and Ex.PW1/F). The first work order was given for installation of L.G Mass Sinages in Delhi and the subsequent work order was given for L.G. Branding in Haryana. Thus, the onus is on the plaintiff to establish the factum of assigning of the aforesaid work orders by the defendant to her firm. Defendant company has disowned both the work orders and has contended that they never placed any work order with the plaintiff's firm and the issuance of said work order is the fraudulent act committed by plaintiff in collusion with her husband (Mr. Santul Purang) who was an employee of the defendant company at the relevant time. Thus, under these circumstances, plaintiff was under heavy burden to establish each aspect related to these two work orders.
Case No. CS(COMM)/450/2019 Page No. 14 of 496.1 Firstly, it is to be seen whether both these work orders were assigned by the defendant company to the plaintiff as claimed by her or had been fraudulently issued by the husband of the plaintiff to the firm of the plaintiff by misusing and abusing his official position in the defendant company as claimed and contended by defendant. Thus, in order to assess and analyze the same, the claim of the plaintiff as well as defence put up by defendant company are to be considered simultaneously, notwithstanding that the onus to prove the fact that there was a contract between the parties regarding these two work orders lies on the shoulders of plaintiff.
6.2 Plaintiff has claimed that she had been dealing with the defendant and prior to the subject work orders, defendant had been availing the services of her firm, thus, on the basis of these averments plaintiff endeavoured to establish that even prior to these two work orders, defendant company had previously also assigned some work to the firm of the plaintiff and therefore, she wishes to portray that both the parties had regular business transactions with each other (regarding marketing job) before these work orders were assigned. Thus, plaintiff was required to prove her aforesaid claim, however, it is clear from the record that plaintiff has simply contended the same and neither plaintiff has filed any document regarding the previous transactions held between the parties nor the defence witnesses were cross examined on this aspect. Plaintiff has neither placed any document in regard to the constitution Case No. CS(COMM)/450/2019 Page No. 15 of 49 of her firm nor any document regarding registration of her firm with the tax authorities. She has neither produced her income tax return nor statement of account pertaining to the business transactions of her firm. Plaintiff has also not placed on record the statement of account pertaining to the previous transactions that took place between the plaintiff and the defendant. Thus, plaintiff has failed to establish that there was any previous transaction between her firm and the defendant company. Furthermore, during cross examination, plaintiff admitted that her firm came into existence in Feb. 2017 and as per her claim she was awarded first work order (out of the two subject work orders) on 07.04.2017 that is within short span of two months time of the constitution of her firm. Therefore, even otherwise (though she failed to prove) it cannot be assumed that within such a short span of time, she had other transactions with defendant as well as with other establishments.
6.3 It is undisputed that in order to have the marketing job work order, all the vendors were required to get themselves registered with the defendant company. It seems that since plaintiff did not want to bring on record the real facts pertaining to the registration of her firm with the plaintiff company, therefore, she simply stated that she had been dealing with the defendant company in the past also. Since the transactions regarding both the work orders have been completely disowned and have been called to be the result of fraudulent acts on the part of the husband of the plaintiff, Case No. CS(COMM)/450/2019 Page No. 16 of 49 therefore, plaintiff was under legal obligation to establish all the relevant facts pertaining to her registration with the defendant company. It is undisputed that vide email dated 04.04.2017 Ex.DW1/2 (colly.), plaintiff for the first time made a request (for vendor registration) with the defendant and the said email was written by Colourdrop Solutions to Mr. Pradosh Pati and Sh. Santul Purang, (the husband of the plaintiff). During cross examination, plaintiff admitted the aforesaid fact that the documents required for registration as vendor with defendant were provided to her by her husband. It is clear from Ex.DW1/2 that Sh. Pradosh Pati did not respond to the said email sent by plaintiff and within two minutes of the receipt of the said email plaintiff's husband swiftly acted upon the said mail and forwarded the said email to Sh. Ravinder Verma (the employee of defendant company) for vendor registration. In order to analyze the actual situation, the timeline of the transactions related to the work order are very important. It is undisputed that for the first time, plaintiff's firm sought its registration with the defendant company on 04.04.2017 and as per plaintiff, within 3 days i.e. on 07.04.2017, the first work order (Ex.PW1/D) was awarded to her. Thus, in order to establish that she was registered as a vendor with defendant company, plaintiff was required to place on record the confirmation mail sent by defendant company confirming her registration with the defendant company. The plaintiff was also required to place on record all the documents like the quotations sent by plaintiff to the defendant as well as all the Case No. CS(COMM)/450/2019 Page No. 17 of 49 documents pertaining to the advertising job carried out by her firm in the past. The plaintiff was required to place on relevant email through which she sent all the requisite documents to the defendant company because in order to get registration, plaintiff would be required to specify the work which has been undertaken by her firm for other business establishments as well as the quotations (rates of the advertisement boards to be installed by her) on which plaintiff was ready to provide the marketing services to the defendant. As per plaintiff, she was given the said work order after she applied for registration thus, she was required to also place on record the relevant email/correspondence through which her registration was confirmed by defendant. Both the work orders are of substantial amount thus, it cannot be assumed that simply through email communication, the defendant company was convinced with the quality of the work of the plaintiff as well as the competitive rates offered by the plaintiff. Thus, besides email communication some more communication would have taken place between the parties either personally or through telephonically. During cross examination, PW1 stated that her firm used to communicate with defendant either telephonically or through email and when she was asked about the phone number on which she had a talk with the defendant, she said that she does not remember the number but she has saved the phone number in her phone book. The plaintiff neither brought on record the said phone number nor the dates on which she communicated with the defendant prior to receiving the work Case No. CS(COMM)/450/2019 Page No. 18 of 49 orders. She was also not able to specify the name of any of the employees of the defendant company. As per plaintiff, she was given two work orders that too of substantial amount, thus, in case, she would have had any interaction regarding these work orders with the defendants then surely, she would be in a position to specify the phone numbers on which she used to communicate with defendant as well as the employee of the defendant with his designation with whom she used to interact. Thus, it is clear from these discussions that it is the husband of the plaintiff who firstly informed the plaintiff about the procedure for registration and also provided the relevant documents to her. Furthermore, it is he (husband of plaintiff), who pursued the email of the plaintiff firm, though, nothing has come on record to show that defendant did accept the request of plaintiff and registered the plaintiff as a vendor in their company.
6.4 As per plaintiff, she was awarded the work order Ex.PW1/D and Ex.PW1/F, but neither in the plaint nor in her affidavit, she specified as to how these work orders were communicated to her. During cross examination, plaintiff stated that these work orders were sent to her by Sh Ravinder Verma through email. Thus, under these circumstances, plaintiff was required to place on record the relevant emails through which she was communicated and assigned the said work orders, however, neither she specified the email ID of Ravinder Verma through which he had sent the work orders Case No. CS(COMM)/450/2019 Page No. 19 of 49 nor she placed on record the copies of those emails on record. Thus, under these circumstances, it cannot be assumed that these work orders were sent by Sh. Ravinder Verma to the plaintiff. Perusal of the said work order shows that these work orders were prepared by Sh. Ravinder Verma, however, neither these work orders bears the signatures of Sh.Ravinder Verma nor signatures of the authorized signatory of defendant company. Besides, seal of the defendant company has also not been appended. Even if it is assumed that the said work orders were sent through email yet it cannot be assumed that through an unsigned document, the work orders of such a substantial amount would have been awarded by the defendant to the plaintiff. Furthermore, it is undisputed position of fact that plaintiff was not given any advance payment against the work orders and therefore, under these circumstances, it cannot be assumed that the plaintiff who was dealing with the defendant company for the first time would proceed to execute the work orders on the basis of the unsigned work orders. Thus, even if it is assumed that both the parties were communicating with each other through email yet at least plaintiff would have insisted for a digitally signed work orders. Furthermore, perusal of the work orders also shows that the terms and conditions especially, regarding the timeline of execution of the work orders, have not been specified in the work orders, thus, plaintiff was required to specify as to what terms and conditions were settled between the parties regarding execution of the work orders. Neither the period during which Case No. CS(COMM)/450/2019 Page No. 20 of 49 the work orders were to be completed nor the terms and conditions for payment of the work orders have been specified in these work orders. As per work orders, the payment was to be made within 30 days, however, this term is entirely vague and neither it has been specified that payment is to be made by the defendant to the plaintiff within 30 days of the invoices nor that within 30 days of submissions of the completion report by the plaintiff alongwith the bills. The work orders also do not specify as to whether the entire payment was to be made after completion of the work or some payment was to be made in advance also. It cannot be assumed that these material terms of the agreement would not have been finalized between the parties prior to plaintiff's accepting and taking action in terms of these work orders. Plaintiff has not brought on record any document to show as to what were the terms and conditions qua these work orders. If any document was executed then plaintiff ought to have placed the same or record and in case these terms and conditions were settled through negotiations then also plaintiff was required to specify the name of the employees of the defendant company with whom these terms were finalized. However, plaintiff has not brought on record any evidence in this regard.
6.5 As per plaintiff these work orders were sent to her by Sh Ravinder Verma. In view of the peculiar facts and circumstances of the present case, the plaintiff was under
heavy burden to prove these work orders. Even if plaintiff was Case No. CS(COMM)/450/2019 Page No. 21 of 49 unable to place on record the relevant email communications yet plaintiff had ample opportunity to summon and examine Sh Ravinder Verma, employee of defendant company to establish the factum of assignment of these work orders, however, no efforts were made by the plaintiff in this regard. Thus, it is clear that plaintiff has neither placed on record the email communication through which the work orders were assigned to her nor examined the relevant witness in order to prove these work orders. It is also clear from these work orders itself that there are several legal flaws as neither the terms and conditions for execution of the work orders nor related to release of payment have been specified in the work orders and the most important thing is that these work orders does not bear signature of the authorized representative of defendant company. Keeping in view of these facts and circumstances, it is held that plaintiff has failed to prove that these work orders were sent by the defendant to the plaintiff. Furthermore, the present is a fit case where adverse inference should be drawn against plaintiff for withholding the material evidence. As per plaintiff all the documentary communications took place between the parties through email i.e. from the time of registration of her firm with defendant and till the time of assignment of the work orders. Thus, the plaintiff has heavily relied upon the email communications qua her registration and assignment of these work orders and in order to establish her claim of acceptance of her registration by the defendant as well as awarding of work orders, the plaintiff ought to have Case No. CS(COMM)/450/2019 Page No. 22 of 49 placed on record all the relevant emails alongwith their attachments, however, it is clear that plaintiff has not placed on record even a single email pertaining to her aforesaid claim, though, in order to show that in regard to the verification of her claim, the defendant had requested her through email to have a meeting, the plaintiff has placed on record the relevant email. This particular fact clearly shows that the plaintiff would have also placed on record all the relevant email communications if these work orders would have been sent by the defendant through email. Thus, under these circumstances, an adverse inference should be drawn against the plaintiff that she was not assigned these work orders through email otherwise she would have placed the same on record.
6.6 It is clear from the aforesaid discussions that plaintiff has failed to prove that she had carried out any other work prior to assignment of subject work orders either for plaintiff or for any third party. Thus, it is clear that the work order Ex.PW1/D was first work order which was ever assigned to the plaintiff by any business establishment for installation of their flex boards. It is also clear from both these work orders that both these work orders were of substantial amount and therefore, under these circumstances, it cannot be assumed that plaintiff would agree to execute these work orders without having any advance payment against the same. It is hard to believe that plaintiff would spend such a huge amount in execution of the work orders without ensuring at least some Case No. CS(COMM)/450/2019 Page No. 23 of 49 part payment in advance. Since it was the very first dealing between the parties, therefore, it cannot be assumed that the plaintiff, without securing even some part of the amount to be spent by her out of her own pocket, would go ahead in executing not only one rather both the work orders.
6.7 Whether there was a valid contract between the parties or whether there was any contract at all between the parties is also to be seen. Even if it is assumed that there was a valid contract between the parties yet the plaintiff can claim the agreed amount only after she proves on record the proper execution of both the work orders. As per plaintiff, she installed all the flex boards at the designated places of Delhi and Haryana and in this regard plaintiff has exhibited in her evidence, the list containing the names of the dealers as well as photographs where these boards stated to have been installed.
The said documents have been exhibited as Ex.PW1/H and Ex.PW1/I (Colly.). Plaintiff has not placed on record any document to show that as to how she was communicated the aforesaid list of dealers where the flex boards were to be installed, thus, under these facts and circumstances, it cannot be assumed that the defendant had given the task to the plaintiff to install the flex board at the places mentioned in these lists. Furthermore, in Ex.PW1/H, plaintiff has annexed several lists of dealers as per which about 587 boards were to be installed by the plaintiff at several places in Delhi and in order to prove the installation of these boards, the plaintiff has Case No. CS(COMM)/450/2019 Page No. 24 of 49 exhibited only 39 photographs. Likewise, qua the second work order plaintiff was to install 196 flex boards at different places in Haryana and alongwith this list plaintiff has exhibited 38 photographs. Thus, it is clear that plaintiff has exhibited only 77 photographs though, as per the list filed by plaintiff herself she was supposed to install total 783 flex boards in Delhi and Haryana. Thus, it is clear that plaintiff has not brought on record the relevant evidence to establish that she has installed the requisite number of flex boards. Thus, under these circumstances, it is held that plaintiff has failed to prove that she has properly executed both the work orders.
6.8 As per plaintiff, the vendor is not responsible for maintenance of these flex boards after their installation thus, in order to establish the proper installation, the plaintiff was also required to place on record the acknowledgement of installation obtained from the dealer concerned, however, not even a single acknowledgement has been placed on record by the plaintiff in this regard.
6.9 Perusal of the plaint shows that plaintiff herself got executed both these work orders, however, at the stage of her evidence, plaintiff put up a new case that she got executed these work orders through a sub vendor namely Mr. Mashkoor Ahmad Chaudhary Prop. of M/s Ad Station. In view of the settled law, plaintiff is required to state all the relevant facts in the plaint itself, however, the plaint is silent about the same Case No. CS(COMM)/450/2019 Page No. 25 of 49 and perusal of the same shows that she herself got executed these work orders however, at the stage of evidence, plaintiff put up altogether a new case that she did not herself executed these work orders and she had further assigned the task of installation of the flex boards to M/s Ad Station. Therefore, the plea taken by the plaintiff at the stage of evidence that she got these work orders executed through Ad Station seems to be an afterthought and there are several other factors to believe the same. Furthermore, as per plaintiff, she was assigned these work orders, therefore, without prior permission of plaintiff, she could not have further assigned these work orders to a sub vendor. There is nothing on record to show that plaintiff was given liberty to execute these work orders either through her own firm or through a sub vendor. Besides, the plea of plaintiff that she got executed these work orders through Ad Station is totally unfounded. Plaintiff has not placed on record even a single document to show that she had assigned these work orders to M/s Ad Station. Besides, plaintiff was also required to specify in her pleadings as well as evidence as to what were the terms and conditions of sub vending, however, all these requisite informations have not been placed on record by the plaintiff. In order to prove the sub vending, plaintiff examined Sh. Mashkoor Ahmed Chaudhary, the proprietor of M/s Ad Station as PW3. PW3 also stated that both these work orders were assigned to him, however, PW3 has not brought on record even a single document to show the said assignment. As per cross examination of PW3, he raised the invoice of Case No. CS(COMM)/450/2019 Page No. 26 of 49 Rs.20.00 Lac against the plaintiff qua these work orders. Thus, in order to execute the aforesaid work orders, PW3 must have spent a considerable amount for purchasing the raw material, however, PW3 has not placed on record even a single document to show that he had purchased any raw material for preparation and installation of flex boards. Thus, the evidence of plaintiff/PW1 as well as PW3 is fully untrustworthy in this regard. Furthermore, as per PW3, he had raised the invoice of Rs.20.00 Lac qua both these work orders and reflected the same in his GST return, however, PW3 has not placed on record the relevant GST return to show the same. Furthermore, it is clear that the total amount of both these work orders was Rs.16,92,697.60P (including GST) and understandably, plaintiff would further assign these work orders to PW3 only for a lesser price thereby keeping a good margin for herself, however, as per PW3 he billed the plaintiff for the said work orders for Rs.20.00 lac. Thus, under these circumstances, it cannot be assumed that plaintiff would agree to pay much more than what she was supposed to receive from the defendant company against execution of these work orders.
6.10 As per PW3, he executed both these work orders and he also handed over the completion certificate to the plaintiff, however, neither plaintiff nor PW3 brought the said completion report on record. Thus, in case PW3 would have completed the said work and submitted the detailed report, same would have been filed on record by the plaintiff Case No. CS(COMM)/450/2019 Page No. 27 of 49 alongwith the relevant invoices raised by PW3, however, it is clear that plaintiff has neither filed the said report alongwith the plaint nor these witnesses have brought the same on record during their evidence. Instead of filing any report, plaintiff as well as PW3 both relied upon the photographs which have been exhibited as Ex.PW1/I. As per the case of the plaintiff, these photographs were taken by the Ad Station and in this regard, PW3 was also cross examined and it is clear from his cross examination that PW3 failed to specify the source of these photographs. PW3 was unable to specify the names of his team members who handed over these photographs to him. Furthermore, PW3 also admitted that he personally did not verify the installation of all these boards. He voluntarily stated that his team members must have verified the same. He also voluntarily stated that they had shown him the photographs of installation of the said boards. Thus, it is clear that PW3 neither personally verified installation nor was aware as to who had verified the same and as far as complete photographs of installation is concerned, same have not been placed on record by any of these witnesses and only 77 photographs have been placed on record which also remained unproved.
6.11 As far as the photographs which have been exhibited by PW1 during her evidence are concerned, same remains a mystery as to who had actually clicked these photographs. Since as per plaintiff the boards were installed by Ad Station, therefore, it is PW3 who should be aware of the Case No. CS(COMM)/450/2019 Page No. 28 of 49 same, however, PW3 did not bring on record the source of these photographs. The printouts of the photographs which have been brought on record appears to have been clicked through a digital device and thereafter, the print outs of these photographs have been taken. Thus, in view of the settled law these photographs falls within the category of electronic evidence and therefore, these photographs should have been accompanied by the requisite certificate u/s 65-B of Indian Evidence Act. PW3 was required to specify the name of persons who had clicked these photographs as well as the compete details of the device through which these photographs were taken. Besides, the date and time of clicking of these photographs was also required to be specified. It was also required to be specified as to who was the owner of the device through which the photographs were taken. The requisite certificate u/s 65-B of I.E Act of the person who had taken these photographs as well as their printouts also should have been brought on record in order to enable this court to consider these photographs. It is clear from the examination in chief of PW1 that at the time of tendering of these photographs, Ld Counsel for the defendant had objected to the mode of proof of these photographs however, despite having ample opportunity, plaintiff did not make any effort to bring on record the requisite certificate alongwith aforesaid complete details. In her evidence, the Plaintiff/PW1 has exhibited a certificate u/s 65-B of Evidence Act which is neither in accordance with law (as it does not contain the requisite details) nor having any Case No. CS(COMM)/450/2019 Page No. 29 of 49 evidentiary value as far as these photographs are concerned because neither plaintiff nor PW3 can provide a certificate u/s 65-B of I.E. Act qua these photographs as they are not the person concerned who had taken these photographs. In view of these facts and circumstances, it is held that plaintiff has failed to prove the photographs Ex.PW1/I (colly.).
6.12 In view of the aforesaid discussions, it is clear that plaintiff has failed to establish that she was given subject work orders for installation of flex boards in Delhi and Haryana and also that she executed both these work orders. Besides, there is one important aspect of the matter which is required to be discussed in detail. Plaintiff has claimed that she was a registered vendor with the defendant and she was given a contract of installation of flex boards in Delhi and Haryana through two work orders Ex.PW1/D and Ex.PW1/F, however, defendant has taken a defence that defendant had not given any contract/work order to the plaintiff and plaintiff's husband Sh Santul Purang (who was working the defendant company), fraudulently, without having any authority and prior permission of the defendant company, issued the said work orders and he also introduced the invoices raised by the plaintiff qua these work orders into the system of defendant company. Thus, the onus was on the plaintiff to establish that there was a contract between the parties qua these two work orders.
Case No. CS(COMM)/450/2019 Page No. 30 of 496.13 As already discussed in detail in the preceding paras that plaintiff has failed to establish that her registration (as a vendor) was accepted by the defendant and also that after her registration, she was given two different contracts (two work orders). Since the plaintiff has failed to establish her claim of assignment of the said work orders (two contracts) under these circumstances, the defence of the defendant that the assignment of these work orders was the fraudulent act on the part of the husband of the plaintiff in collusion of the plaintiff seems to be quite probable and acceptable. Moreover, there is enough evidence available on record which also indicate the same and therefore, the relevant evidence is required to be dealt with in detail. As per plaintiff, she is the proprietor of M/s Colour Drop Solutions to whom the work orders were assigned by the defendant, however, she has not placed on record even a single document to show as to when she had constituted the said firm. During cross examination, initially she could not even specify the year in which it was constituted, however, in further part of her cross examination, she stated that her firm came into existence in February 2017. Plaintiff also could not reply as to when she approached the defendant for registering her firm as a vendor. It is further clear from her cross examination that she was also not aware about the names of any of the employees of the defendant company which is also not acceptable as it cannot be assumed that she was assigned with the said work orders without having any meeting or interaction in regard to these work orders. During Case No. CS(COMM)/450/2019 Page No. 31 of 49 cross examination, the Linkedin profile of M/s Colour Drop Solution was brought on record as Ex.PW1/D1 and it is clear from the contents of this profile that husband of plaintiff (Mr. Santul Purang) has specified himself as founder of M/s Colour Drop Solution. This document clearly shows that the husband of plaintiff had constituted the firm M/s Colour Drop Solution. As already discussed, the email sent by the firm M/s Colour Drop Solution on 04.04.2017 for registration as a vendor was mailed to Mr. Pradosh Pati as well as Mr. Santul Purang and it is clear that Mr. Pradosh Pati did not respond to the said mail and within two minutes of receipt of the said mail, husband of the plaintiff (Mr.Santul Purang) acted upon the same and forwarded the said mail to Sh Ravinder Verma with a request for Vendor Registration. During cross examination, PW1 admitted the aforesaid mail and thus, it is clear that admittedly, the said mail was written by Colour Drop Solutions to aforesaid two persons of the defendant company and Mr. Santul Purang immediately took action in this regard, however, during the cross examination, her husband(PW2) denied that he assisted the plaintiff in regard to registration of the Colour Drop Solution with defendant company. It is clear from the aforesaid email itself that the husband of plaintiff had actively and swiftly processed the request of the plaintiff for her registration with the defendant though he attempted to deny this fact during his cross examination which itself shows that he wants to conceal this fact as he is fully aware that being husband of the plaintiff he ought not to have responded to the Case No. CS(COMM)/450/2019 Page No. 32 of 49 mail sent by his wife (being close relative of a proposed vendor). The plaintiff was fully aware that her husband is working with the defendant company and therefore, she ought not to have made a request to him for vendor registration. Moreover, in case, the plaintiff did not fall within the prohibited category and could have made the request for registration like any other vendor, then plaintiff ought not to have sent the said mail to her husband and even if it was sent then her husband either ought not to have responded or taken any action in pursuance to the said mail or before taking any action ought to have brought this fact into the notice of the management of the defendant company for which he was bound in view of the following SECRECY Clause of his appointment letter (Ex.PW2/D1) :-
"SECRECY You will not give to any unauthorized person by word of mouth or otherwise particulars or details of our processes, operational plans, administration, technical know-how and organizational matters pertaining to the company, its associates or dealers that you may be in knowledge of during and by virtue of your employment by the company. You shall both during and after your employment take reasonable precautions to keep such information secret".
6.14 It seems that the husband of plaintiff did not disclose the same with the management of defendant company as he in collusion with his wife wanted to take all the steps in regard to the subject work orders in a clandestine manner and without having any official sanction/permission qua the same Case No. CS(COMM)/450/2019 Page No. 33 of 49 from the management. It is clear that though the said mail was sent by the plaintiff firm for registration, however, plaintiff has not placed on record any document to show that her registration was accepted. Thus, it cannot be said that the plaintiff was a registered vendor and therefore, even otherwise plaintiff could not have been assigned with any work order. Even if it is assumed that anyhow the husband of plaintiff got the plaintiff registered with the defendant but it cannot be assumed that within such a short span of time (three days i.e. from 04.04.2017 to 07.04.2017), the defendant company would assign a work order of such a substantial amount to the plaintiff's firm which never had any previous transaction with defendant and also did not have any past experience. Furthermore, there is nothing on record to show that as to how the communication regarding inviting of quotations qua the subject work orders took place between the parties. Presumably, in case the defendant would have actually assigned these work orders, they would have done so, after being fully convinced with the competitive rates as well as quality offered by plaintiff's firm qua the proposed work. However, nothing has been placed on record as to how defendant invited quotations qua these work orders and as to how plaintiff provided the said details before getting these work orders. The plaintiff has also not placed on record as to how and by whom these work orders were assigned to her. No details of the communications that took place between both the parties qua the same have been brought on record. Plaintiff has Case No. CS(COMM)/450/2019 Page No. 34 of 49 simply contended that defendant had assigned these work orders. Besides, it is also clear that these work orders are nothing but merely a typed document on the Excel Sheet which even does not bear the signatures of the authorized person of the defendant company. Furthermore, plaintiff has failed to establish on record that as to how she came into possession and what is the real source of these work orders which also shows that these work orders are self created documents and since plaintiff has claimed that these work orders had been issued by the defendant but failed to prove the same, then under these circumstances and keeping in view of the defence of the defendant as well as the evidence of the plaintiff and her witnesses, it has to be assumed that these documents (the two work orders) were created by husband of the plaintiff.
6.15 There are further reasons to believe the same. Perusal of the work order Ex.PW1/D shows that as per plaintiff, defendant charged a substantial amount on account of VAT which is not possible as VAT cannot be levied or charged on a purchase order. Furthermore, the assignment of the same could have been easily proved by examining Mr. Ravinder Verma who said to have prepared these work orders. There was another way of establishing the same by summoning the relevant record of the defendant company, however, none of the relevant/material witness was summoned to establish the same.
Case No. CS(COMM)/450/2019 Page No. 35 of 496.16 Thus, it remained unproved as to who and how the work orders were assigned to the plaintiff. Likewise, is the scenario of the invoices pertaining to both these work orders. As per plaintiff after completion of work orders, plaintiff submitted the respective invoices with the defendant company, however, plaintiff has not brought on record the proof of submission of the invoices with the defendant. Plaintiff has neither brought on record any proof of submission of these invoices with the defendant company nor specified as to how and by which mode she submitted these invoices. In this regard, plaintiff/PW1 was cross examined, however, she could not properly specify as to how she sent these invoices to the defendant. In the same breath, firstly she said that these invoices were sent through email and then subsequently she stated that she sent the same through her representative and when she was asked about the name of representative, she was not able to recall his name. Even if it is assumed that plaintiff personally sent these invoices to the defendant then these invoices must contain the acknowledgement of receipt of these invoices from the side of defendant, however, these invoices do not bear any acknowledgement of the office of defendant company. In this regard, PW2 was also cross examined but he showed his ignorance as to who had received the invoice dated 18.08.2017 in the defendant company, however, when he was shown the copy of the aforesaid invoice containing his signature qua the receipt of the said invoice, PW2 admitted his Case No. CS(COMM)/450/2019 Page No. 36 of 49 signature and therefore, the copy of the said invoice was brought on record as Ex.PW2/D2. In view of these facts and circumstances, it is clear that the invoices raised by the plaintiff also entered in the record and system of the defendant company only through the husband of the plaintiff and it is clear from the aforesaid cross examination that every effort was made by Plaintiff as well as her husband to portray that these invoices were submitted with the defendant company through proper channel. In view of these discussions, it is clear that the husband of the plaintiff being the employee of the defendant company (especially because he was employed in the marketing department) misused his official position, as firstly he created these work orders and subsequently, in a clandestine manner, he got submitted these invoices qua these work orders in the office of defendant company. The fact that the said unauthorized activity was actually done by the husband of plaintiff, is also clear from the contents of his letter dated 25.09.2017 Ex.PW1/D2 and his resignation letter Ex.PW1/D3. The contents of these letters are reproduced as under:-
Ex.PW1/D2 "Dear Sir/Mam, This is to bring to your kind attention that vendor named "Colourdrop Solutions" bears the name of my wife Mrs. Kritika Soni as the proprietor. All the papers are presented by Mr. Ajay Goswami as evidence. Please accept my apologies to be involve in any practice like this. Also please note that no payment has been given to this vendor till now. Please terminate services of vendor that no vendor's payment to be made to Colourdrop Solutions (F-16 Ashok Vihar Phase-1, Delhi-110052) Case No. CS(COMM)/450/2019 Page No. 37 of 49 Regards (Santul Purang) LETP 0065"
Ex.PW1/D3 "Dear Sir/Mam, Please accept my resignation w.e.f Sep 25,2017 in view of the Vendor (Colordrop Solutions) connection presented. I apologize for the case and officially give a resignation.
(Santul Purang) LETP 0065"
6.17 The fact that the husband of plaintiff was involved in issuance of the work orders as well as accepting the invoices raised by the plaintiff's firm is clear from the apology letter dated 25.09.2017 written by the husband of plaintiff at the time of resigning from the defendant company. It is clear from the contents of this letter that he accepted that he was involved in an unauthorized activity and also stated that the service orders given to the plaintiff may be terminated and defendant was not required to make any payment to the plaintiff against these work orders. It is clear from the wording of this letter that all the fraudulent activity committed by the husband of the plaintiff in the defendant company regarding both these work orders was brought to the notice of Management of defendant company by Sh. Ajay Goswami and thereafter, the husband of the plaintiff accepted his misdeeds and tendered his apology and also submitted his resignation. As such, there seems to be a real substance in the defence of the defendant that the husband of plaintiff had tendered his apology and also gave his resignation when all his unlawful/unauthorized activities came Case No. CS(COMM)/450/2019 Page No. 38 of 49 to light, when the evidence led by the plaintiff as well as the documents brought on record by the defendant are taken into consideration simultaneously. The defendant has also claimed that keeping in view of the unconditional apology tendered by the husband of the plaintiff, they did not take any action against the plaintiff and her husband and when plaintiff observed that sufficient time has already elapsed and no action has been taken against them, they have filed the present claim with their unlawful demand. This particular defence also seems to be true when the entire material brought on record by the defendant is taken into consideration. In this regard, plaintiff has claimed that her husband was pressurized by his senior to resign and he resigned. It is stated that in case he would not have resigned, his insurance would have lapsed and the delivery charges of his pregnant wife would not have been reimbursed. There seems to be no substance in this plea taken by the plaintiff and her husband. The plea taken by the plaintiff is unacceptable as nothing has been brought on record to show that there was any animosity between the husband of plaintiff and the management of defendant company. Thus, no reason whatsoever has been put forth by the plaintiff or her husband for his forceful resignation and therefore, it cannot be assumed that he was forced to resign. Even if it is assumed that he resigned under pressure yet he had ample opportunity at his disposal to assail his resignation after he was forcefully removed. It is clear from the record that no action whatsoever has been taken by Mr. Santul Purang till date. This particular Case No. CS(COMM)/450/2019 Page No. 39 of 49 conduct of Mr. Santul Purang speaks for itself that he did not assail his resignation as well as contents of his apology letter as he had voluntarily given his apology and resignation and he was fully aware that in case, he would assail the same, he would have to face the legal consequences of his illegal/unauthorized activities done by him while he was working with defendant company and simultaneously, it would have also been established during those proceedings that the subject invoices have been raised illegally and without any valid claim. Thus, it is clear that plaintiff waited for a considerable time (around 15 months after raising the invoices and tendering of resignation by her husband) before initiating the claim qua the subject work orders. Plaintiff has not put forth any other explanation on record for waiting for such a considerable time before initiating the action for the present recovery. Thus, the defence of the defendant that the plaintiff initiated the action in regard to the present recovery after a considerable time of the resignation of PW2 after observing that no action has been taken by the defendant in regard to the aforesaid unlawful activities carried out by her husband, seems to be quite convincing.
6.18 It is also to be seen if there was a valid contract between the parties. For forming a valid contract, besides other necessary requirements, the first and the foremost requirement is that there should be at least two parties and they should be at ad-idem qua the subject matter and in view of the aforesaid Case No. CS(COMM)/450/2019 Page No. 40 of 49 discussions, it is clear that in the present case, the issuance of the subject work order is the unilateral act of the husband of the plaintiff. It is also clear from the aforesaid discussions that at the time of issuance of work orders, the work of the firm M/s Colour Drop Solution was being looked after by Mr. Santul Purang. Thus, under these circumstances, it can be said that here in the present case there is only one party (husband of plaintiff) who unauthorizedly and by using the paraphernalia of defendant company issued the work orders to himself. Thus, it is clear that in the present case, no contract of issuance of work orders ever took place. During the course of arguments, Ld. Counsel for plaintiff referred to the provisions of Section 19 of Contract Act and stated that even if it is assumed that the consent for issuance of these work orders was taken fraudulently or on misrepresentation yet plaintiff would be entitled to claim the amount as defendant has failed to establish that they could not have detected the same by ordinary diligence. Section 19 of Contract Act reads as under:-
"19. Voidability of agreements without free consent.
(1) When consent to an agreement is caused by coercion, fraud or misrepresentation, the agreement is a contract voidable at the option of the party whose consent was so caused.
(2) A party to a contract, whose consent was caused by fraud or misrepresentation, may, if he thinks fit, claim that the contract shall be performed and that he shall be put in the position in which he would have been if the representations made had been true.
Exception.- If such consent was caused by misrepresentation, or by silence fraudulent within the Case No. CS(COMM)/450/2019 Page No. 41 of 49 meaning of section 17, the contract, nevertheless, is not voidable, if the party whose consent was so caused had the means of discovering the truth with ordinary diligence.
Explanation.- A fraud or misrepresentation which did not cause the consent to a contract of the party on whom such fraud was practised, or to whom such misrepresentation was made, does not render a contract voidable."
6.19 It is clear from the perusal of Section 19 of Contract Act that it would come into play when it is established that a consent was given by the other side, however, in the present case, the work orders were neither issued by the Management nor by the concerned department of defendant company, therefore, the question of failure to apply ordinary diligence by defendant would not arise in the present case. It is clear from the aforesaid discussions that the work orders were issued by the husband of plaintiff of his own and unathorizedly and illegally and in a clandestine manner to the said firm. Thus, in view of these discussions, it is held that since there was no contract between the parties, therefore, question regarding voidability of a contract would not arise at all. Similar is the position in regard to the provisions of Section 65 of Contract Act as this provision also comes into play when the other side has received an advantage under a void contract or the contract that subsequently became void.
6.20 As far as the provisions of Section 70 of Contract Act is concerned, the defendant could have been held liable Case No. CS(COMM)/450/2019 Page No. 42 of 49 only under section 70 of the Act (subject to certain conditions) which reads as under:-
"70. Obligation of person enjoying benefit of non- gratuitous act - Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered.
6.21 The first and foremost condition for application of Section 70 of the Contract Act is that the claimant would be entitled to claim the benefit of his act if he has done the same lawfully for the other person. It is clear that in the present case the work orders were issued illegally and unauthorizedly and in a clandestine manner, thus, plaintiff had no authority to execute the work orders (though she has also failed to establish that she executed both the work orders). During the course of arguments, it was submitted by the Ld. Counsel for the plaintiff that defendant company has itself admitted that they, during audit came to know that plaintiff had carried out the said work though to a certain extent. Thus, it was submitted that the plaintiff has established that she had executed the work orders and therefore, she is entitled to the amount of the same. The perusal of the record shows that according to defendant, plaintiff had carried out the said work on a very small scale (miniscule). However, even if it is assumed that plaintiff carried out these work orders or part of it yet she would not be entitled to claim any benefit under this section as neither she was legally authorized to do so nor the execution Case No. CS(COMM)/450/2019 Page No. 43 of 49 of the work done by the plaintiff was in the prior knowledge of the defendant. In case somebody of his own without any authority of defendant installs their flex boards (advertisement) on their premises or even at the premises of their dealers yet they would not become entitle to claim any charges qua the same from the defendant as they were never authorized to do so by the defendant. As such, this act would not fall within the category of even non-gratuitous act and similar is the position in the present case. Thus, even if plaintiff got installed some flex boards yet she would not be entitled to claim any charges of the same in view of the aforementioned settled legal position. Thus, in view of these discussions, it is most respectfully observed that the Judgement cited by the Ld. Counsel for the plaintiff is not applicable to the facts and circumstances of the present case.
6.22 It is clear from the aforesaid discussions that the present case is based upon the falsehood and self created documents(purchase orders). It has been held by Hon'ble Supreme Court in the case titled S.P Chengalvaraya Naidu Vs Jagannath (Date of Judgment 27 October, 1993), 1994 AIR 853, 1994 SCC (1) 1 that a case which is based upon falsehood is liable to be dismissed. The relevant para of the Judgment of Hon'ble Supreme court is reproduced as under:-
"5....The courts of law are meant for imparting justice between the parties. One who comes to the court, must come with clean hands. We are Case No. CS(COMM)/450/2019 Page No. 44 of 49 constrained to say that more often than not, process of the court is being abused. Property-grabbers, tax- evaders, bank-loan-dodgers and other unscrupulous persons from all walks of life find the court-process a convenient lever to retain the illegal-gains indefinitely. We have no hesitation to say that a person, who's case is based on falsehood, has no right to approach the court. He can be summarily thrown out at any stage of the litigation".
Thus, in view of these facts and circumstances, it is held that the suit of the plaintiff is liable to be dismissed on this ground also.
6.23 It is clear from the above mentioned detailed discussions that plaintiff has failed to prove her claim qua assignment of both these work orders as well as qua execution of the same, however, plaintiff has made further endeavour and contended that plaintiff is entitled to the recovery as defendant has already taken GST benefit against both the invoices raised by her. It is also contended that the defendant has also deducted TDS qua both these invoices. Thus, it has been contended that defendant has taken GST benefit as they had issued the work orders and they are liable to pay the amount of the same. First of all it is clear that it has not been admitted by the defendant that they have taken the GST input against the invoices raised against these work orders. It is also clear that plaintiff has also failed to prove that the defendant has taken the GST input tax credit qua both the invoices. Plaintiff has also taken the same plea qua deduction of TDS in Case No. CS(COMM)/450/2019 Page No. 45 of 49 regard to both the invoices, however, as per record defendant has admitted the factum of deduction of TDS qua one of the invoices and DW2 has put forth the explanation qua the same. Witness of defendant (DW2) did not admit that defendant deducted the TDS after verification of the authenticity of the invoices submitted by the plaintiff. It is well settled law that plaintiff is bound to prove his own case by leading the relevant evidence and as already discussed in detail, in the present case plaintiff has failed to establish the same and it is clear that the claim of the plaintiff is wholly unfounded and baseless. It is also clear that present suit has been filed without a valid cause of action against the defendant. Thus, even if inadvertently, the defendant has taken the GST ITC against these invoices, the defendant will not become liable to pay the amount of these invoices by doing so in view of the peculiar facts and circumstances discussed in foregoing paras. Similar is the situation qua the TDS deducted by the defendant qua these invoices. It is clear from the aforesaid discussions that both these invoices were introduced by the husband of the plaintiff into the office of the defendant in a clandestine manner in order to realize the amount of both these invoices released. Thus, it is clear from these circumstances that initially, the aforesaid fact was not within the knowledge of the defendant and same surfaced subsequently, therefore, even if some action has been taken by the accounts department of the defendant company without there being actual transactions qua these invoices yet solely on the basis of same, defendant cannot be Case No. CS(COMM)/450/2019 Page No. 46 of 49 held liable to make the payment of the same. Moreover, in case, some amount on account of GST has been claimed by the defendant qua these invoices then this is for the defendant to set the things right by taking appropriate action in this regard and similar is the position in regard to the TDS (if any) deducted by the defendant qua the subject transaction.
6.24 In view of these discussions, it is held that there was no contract between the parties for installation of flex boards and therefore, plaintiff was neither under an obligation to install the boards nor entitled to have the amount of the invoices raised for the same from the defendant. As such, it is held that the present suit has been filed without any cause of action. Even otherwise it is clear that the plaintiff has failed to establish her claim qua the execution of these work orders. It is well settled law that burden to prove a fact would always be on a party whose case would fail if no evidence is led by either of the parties. In the present case also the burden was on the plaintiff to prove that subject work orders were given to her by the management of defendant and subsequent thereto flex boards were installed, however, in view of the above discussions, it is clear that the case of plaintiff remained unproved.
6.25 Thus, keeping in view of these facts and circumstances, it is held that the plaintiff has miserably failed to prove Issue no.1 and therefore, consequently, it is held that Case No. CS(COMM)/450/2019 Page No. 47 of 49 she is not entitled to the recovery claimed by her. This Issue is decided accordingly.
ISSUE NO.2 Whether this court lacks territorial jurisdiction to try the present suit? OPD
7. The onus to prove this issue was on defendant, however, in this regard, neither any evidence has been led qua the same nor any submission has been put forth on behalf of the defendant. As per record, the registered address of the plaintiff is situated within Rajouri Garden Extension and since this area falls within the jurisdiction of West District, therefore, it is held that this Court has jurisdiction to try and entertain the present suit. This Issue is decided accordingly.
RELIEF
8. In view of the discussions made while deciding Issue no.1, it is held that the plaintiff has miserably failed to prove her entitlement to claim the suit amount. As such, the suit of the plaintiff is liable to be dismissed. Accordingly, the suit of the plaintiff is hereby dismissed. Since the plaintiff has filed a false and frivolous suit without having a valid cause of action against the defendant, therefore, the present suit is dismissed with cost of Rs.25,000/- out of which Rs.15,000/- is to be deposited by the plaintiff with DLSA and Rs.10,000/- is Case No. CS(COMM)/450/2019 Page No. 48 of 49 to be paid by the plaintiff to the defendant. Decree sheet be prepared accordingly.
File be consigned to record room.
Digitally signedAnnounced in the Open AJAY by AJAY GUPTA
Date:
Court on 05.06.2024 GUPTA 2024.06.05
17:07:04
+0530
(Ajay Gupta)
District Judge (Commercial Court)-05
West, Tis Hazari Courts Extension
Block, Delhi/05.06.2024
Case No. CS(COMM)/450/2019 Page No. 49 of 49