Delhi District Court
Campus Activewear Limited vs Naresh Goyal Proprietor Of M/S Ankur ... on 26 February, 2026
IN THE COURT OF DISTRICT JUDGE (COMMERCIAL)-04
DISTRICT WEST, TIS HAZARI COURTS, DELHI
CS (COMM)No. 212/2024
CNR NO. DLWT01-001798-2024
M/s Campus Activewear Limited
(Formerly M/s Campus Activewear Pvt. Ltd.)
Through its Authorised Representative
Mr. Sanjay Chhabra
Regd. Office At:
D-1, Udyog Nagar, Main Rohtak Road,
New Delhi-110041
Email: [email protected]
Ph. 9889995407 ................Plaintiff
VERSUS
Mr. Naresh Goyal,
Prop of M/s Ankur Shoe Sales
Regd. Office At:
B-3, Gobind Bagh,
Opp. Hira Bagh, Rajpur Road,
Patiala - 147001 ............Defendant
Date of institution of suit : 29.02.2024
Date of Argument : 03.02.2026
Date of pronouncement : 26.02.2026
SUIT FOR RECOVERY OF RS. 46,38,572/- ALONG
WITH P INTEREST @ 18% PER ANNUM DUE OUT OF
INVOICES RAISED TOWARDS GOODS SUPPLIED BY
THE PLAINTIFF
Appearance
Mr. Zeeshan Hashami and Mr. Ankit Parashar, Ld. Counsels for
plaintiff.
Mr. Varun Bedi, Ld. Counsel for defendant.
CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 1 of 27
JUDGMENT
1. The present suit is a commercial suit for recovery of Rs.
46,38,572/- along with interest @ 18% per annum, filed by the Plaintiff, Campus Activewear Ltd., a public limited company engaged in the business of manufacturing and sale of footwear.
2. Briefly stated the Plaintiff company was earlier a private limited company and was converted into a public limited company on 22.11.2021, whereby all assets, liabilities, debts and recoveries are vested in the Plaintiff. Another group company, Campus AI Pvt. Ltd. (formerly M/s Ankit International), also merged with the Plaintiff w.e.f. 01.04.2020 pursuant to approval of the Hon'ble NCLT, and all its assets and liabilities were similarly taken over by the Plaintiff.
3. The Plaintiff claims to enjoy substantial goodwill and reputation in the domestic and international footwear market and is the proprietor of various registered trademarks including "CAMPUS". Mr. Sanjay Chhabra is claimed to have been duly authorised by a Board Resolution dated 09.11.2023 to sign, verify, institute and pursue the present suit on behalf of the Plaintiff.
4. The Defendant is claimed to be the proprietor of M/s Ankur Shoe Sales and is responsible for its day-to-day affairs. Based on the CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 2 of 27 Plaintiff's reputation, the Defendant is stated to have entered into long-standing business transactions with the Plaintiff for supply of footwear. A Distributor Agreement dated 06.12.2018 was executed between the parties, wherein the Defendant acknowledged a previous outstanding debt of Rs. 58,99,185/-. The agreement is claimed to govern transactions during its validity period and subsequent supplies were claimed to be governed by invoice terms.
5. It is stated that pursuant to orders placed by the Defendant, the Plaintiff supplied footwear and raised 70 invoices during the period 09.04.2019 to 30.09.2020 amounting to Rs. 46,81,703/-. Details of 70 invoices are mentioned in a table forming part of paragraph No. 7 of the plaint. Last invoice was raised on 30.09.2020. Against this amount, the Defendant is stated to have made only a partial payment of Rs. 43,131/-. As per the running account maintained by the Plaintiff, an outstanding sum of Rs. 46,38,572/- is claimed to be due and payable by the Defendant, inclusive of taxes.
6. It is stated that the Plaintiff duly supplied goods to the Defendant without any complaint as to quality or delivery. It is stated that despite repeated reminders and demands, the Defendant failed to clear the outstanding dues leading to issuance of demand notices dated 16.04.2021 and 19.04.2021 followed by exchange of replies CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 3 of 27 and counter-replies. The Defendant also personally assured payment on several occasions but failed to honour the same.
7. It is claimed that the Plaintiff has fully performed its contractual obligations, whereas the Defendant has remained irregular and defaulted in payment. Since the Defendant did not come forward to pay the outstanding, legal action was contemplated and as the dispute arose out of commercial transactions falling within the scope of Section 2(1)(c) of the Commercial Courts Act, 2015, hence the Plaintiff complied with Section 12A by initiating pre- institution mediation; however, due to non-appearance of the Defendant, a Non-Starter Report dated 16.10.2023 was issued. Hence, the present suit filed for recovery of Rs. 46,38,572/- along with interest @ 18% per annum from 30.09.2020 till actual realization, along with other consequential reliefs.
8. After service of summons of the suit upon the defendant, the defendant has filed written statement denying all allegations made in the plaint and contends that the suit is false, frivolous, vexatious and an abuse of the process of law. It is pleaded that the plaintiff has suppressed material facts and has not approached the Court with clean hands, rendering the suit liable to dismissal at the threshold.
9. As a preliminary objection, the defendant asserts that the suit is barred by limitation and liable to rejection under Order VII Rule 11 CPC. Relying upon Article 14 of the Limitation Act, 1963, it is CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 4 of 27 contended that the alleged supplies pertain to the period between 09.04.2019 and 30.09.2020 and that the limitation of three years begins from the date of delivery of goods. Since the suit has been instituted on 29.02.2024, it is pleaded to be ex-facie time-barred. The defendant alleges that the plaintiff has deliberately failed to plead how the suit is within limitation and has attempted to artificially create a cause of action by referring to ledger entries of 30.01.2023.
10. Defendant further contends that the suit is without cause of action, bad for mis-joinder of causes of action, not maintainable in law, and is based on false and fabricated documents. It is alleged that the plaintiff has relied solely on its own unilateral ledger, which is denied and disputed and for which strict proof has been demanded.
11. On merits, defendant denies that it approached the plaintiff for purchase of footwear and states that it was the plaintiff who sought to establish business relations. Defendant denies execution, validity and binding nature of the alleged Distributor Agreement dated 06.12.2018 and specifically denies having acknowledged any previous debt of Rs. 58,99,185/-. It is also denied that the agreement was operative till 06.12.2020 or that any transactions were governed by its terms.
12. Defendant categorically denies having placed any purchase orders, receiving any footwear, or agreeing to the terms and conditions mentioned in the alleged invoices. Defendant further denies that CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 5 of 27 the plaintiff supplied goods during the period 09.04.2019 to 30.09.2020 or raised invoices amounting to Rs. 46,81,703/-. Even otherwise, it is pleaded that the alleged invoices are time-barred under Article 14 of the Limitation Act.
13. Defendant also denies having made any payment of Rs. 43,131/- to the plaintiff and disputes the existence of any running account between the parties. The alleged outstanding amount of Rs. 46,38,572/- is denied in toto. The ledger statements, invoices, vouchers and tax documents relied upon by the Plaintiff are alleged to be forged, fabricated and incorrect and incapable of forming the basis of any decree.
14. It is further denied that the plaintiff duly performed its contractual obligations or that the goods, if any, were delivered to the satisfaction of defendant. Defendant asserts that no amount is due or payable and therefore the question of default in payment does not arise.
15. While admitting issuance of demand notices as a matter of record, defendant denies their contents and legality and reiterates that there is no outstanding liability. Defendant also disputes the territorial jurisdiction of the Court, contending that the Defendant carries on business at Patiala, Punjab, and that no cause of action arose within the jurisdiction of the present Court.
CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 6 of 2716. Defendant denies the authorization of the Plaintiff's alleged representative to institute the suit and challenges the Plaintiff's compliance with statutory requirements, including under carriage and transport laws. It is lastly contended that the suit is barred by limitation, devoid of material particulars, and filed only to harass defendant, and therefore deserves dismissal with exemplary costs.
17. Plaintiff thereafter filed replication wherein plaintiff denied the allegation/averment of the written statement while reiterating the contents of the plaint.
18. From the pleadings of the parties following issues were framed by the Ld. Predecessor of this court, vide order dt. 24.07.2024:-
1. Whether the suit is barred by limitation? OPD
2. Whether the plaintiff has concealed the material facts and has not come to court with clean hands? OPD
3. Whether the suit is contrary to the provisions , especially Section 31 to 33 of The Sales of Goods Act? OPD
4. Whether the plaintiff is entitled to recovery of suit amount alongwith interest, as prayed for? OPP.
5. Relief
19. In order to prove its case plaintiff examined its legal manager Sujeet Kumar Mishra as PW1 who filed his affidavit Ex PW1/A wherein he reiterated the contents of the plaint and relied upon fresh copy of certificate of incoporation, master data of the CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 7 of 27 plaintiff, master data of campus AI Pvt. Ltd., Form No. URC-1, Form MGT 4 and 6, and Ministry of Corporate Affairs Receipt Ex PW1/1 (colly), Board Resolution in favour of Mr. Sanjay Chhabra Ex PW1/2, GST details of the defendant Ex PW1/3, Copy of agreement dt 06.12.2018 Ex PW1/4 (OSR), Airway Bills/Delivery proofs Ex PW1/5 (colly), Copy of ledger Ex PW1/6, Copies of Tax Invoice/Credit Note/Voucher Ex PW1/7, Copies of demand Notices, reply dt. 29.04.2021, Counter reply dt. 14.05.2021, reply dt. 17.05.2021, emails dt. 14.05.2021, 18.05.2021 and 20.05.2021 alongwith Speed Post Receipt and traking reports filed with plaint Ex PW1/8 (colly), Non Starter Report dt. 16.10.2018 Ex PW1/9, affidavit under Section 63 of BSA Ex PW1/A-1 and authority letter dt. 12.09.2024 Ex PW1/B. He was duly cross examined by Ld. Counsel for defendant.
20. Plaintiff examined two witnesses PW2 Puneet Kumar from Safexpress Pvt. Ltd. and PW3 from Gati Express & Supply Chain Pvt. Ltd. to prove deliveries of goods. Plaintiff further examined its Manager-Commercial Sh. Pradeep Kedia as PW4 who filed his affidavit Ex PW4/A wherein he reiterated the contents of the plaint relying upon Authority letter dt 28.02.2025 Ex PW4/1 and documents relied upon by PW1. He was duly cross examined.
21. In support of his case, defendant examined himself as DW1 and filed his affidavit Ex DW1/A wherein he denied the case of the plaintiff. He was duly cross examined by the Counsel for plaintiff.
CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 8 of 2722. Having heard rival submission of the Ld. Counsel for parties, judicial file perused. Pleadings, oral and documentary evidence, material on record as well as respective contention of the parties taken into consideration. Issue-wise findings are hereinafter.
ISSUE No.1:- Whether the suit is barred by limitation? OPD
23. Onus to prove this issue is upon the defendant. Ld. Counsel for defendant contended that alleged transaction of the plaintiff with defendant would be governed by Article 14 of the Limitation Act and suit to recover the price of unpaid goods had got to be filed within 3 years of each invoice. He contended that first alleged invoice was of 09.04.2019 and last invoices was of 30.09.2020 and therefore to recover the price of invoice of 09.04.2019 plaintiff was required to file his suit latest by 08.04.2022 and for the last invoice, by 29.09.2023 and present suit having been filed on 29.02.2024 was clearly time barred.
24. Ld. Counsel for the plaintiff contended that plaintiff's suit was well within limitation relying upon judgment of Hon'ble Supreme Court in Suo Moto Writ Petition bearing No. 3/2020 titled as Re:
Cognizance for Extension of Limitation. He further contended that plaintiff was maintaining running account which shows that defendant had lastly paid through IMPS on 30.01.2023 and had also paid through IMPS on 15.06.2022, 27.06.2022, 28.07.2022, 31.08.2022 and 29.12.2022 besides the payment on 30.01.2023.CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 9 of 27
25. Having heard rival submissions of the parties, this court has taken note of the rulings of the Hon'ble Supreme Court in aforesaid Writ Petition (c) No. 3/2020 which has excluded the period between 15.03.2020 and 28.02.2022 from computation of limitation period. As per plaintiff, the first invoice involved in the present case was raised on 09.04.2019 and therefore, as per the contention of the defendant, the cause of action to recover the price of unpaid goods supplied through invoice dt 09.04.20219 started on 09.04.2019 but it got paused on 15.03.2020 and started ticking again on 01.03.2022 in accordance with the aforesaid ruling of the Hon'ble Supreme Court.
26. Excluding the period between 15.03.2020 and 28.02.2022, plaintiff was required to file its suit to recover the price of goods supplied through invoice dt 09.04.2019 by 17.02.2024, as 266 days were exhausted before 15.03.2020 and it was left with 729 days w.e.f. 01.03.2022. Before the expiry of limitation period calculated in aforesaid manner, plaintiff approached DLSA on 05.09.2023 for pre-litigation mediation and spent 41 days there when Non starter report dt. 16.102023 was issued. Thus, plaintiff would get 41 more days from 17.02.2024 for the completion of three years period for the expiry of limitation period to recover the price of goods sold through invoice dt 09.04.2019. Adding these 41 days, takes expiry of the limitation period to 29.03.2024. Present suit was filed on 29.02.2024 almost one months before the expiry of limitation period. When plaintiff's suit to recover the price of goods of first CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 10 of 27 invoice dt 09.04.2019 is not barred by limitation certainly, limitation period to recover the prices of goods supplied through subsequent invoices will not be said to be barred by limitation. Hence, going by the contention of the defendant regarding applicability of Article 14 of the Limitation Act qua each invoice, plaintiff's suit to recover the prices of goods sold through all the invoices between 09.04.2019 and 30.09.2020 is not barred by limitation. Accordingly, issue No.1 is decided against the defendant and in favour of the plaintiff.
ISSUE No. 2:- Whether the plaintiff has concealed the material facts and has not come to court with clean hands? OPD
27. Once again onus to prove this issue upon defendant. Defendant neither in his pleading nor in his testimony pointed out as to what facts, not to speak of material fact, have been concealed by the plaintiff. In the absence of pointing out of any alleged concealment, the present issue is got to be decided against the defendant. Hence, issue No.2 is decided against the defendant and in favour of the plaintiff.
ISSUE No. 3:- Whether the suit is contrary to the provisions, especially Section 31 to 33 of The Sales of Goods Act? OPD
28. Onus to prove this issue is upon defendant. Section 31 to 33 of The Sales of Goods Act, 1930 reads as under:-
"31. Duties, of seller and buyer.-- It is the duty to the seller to deliver the goods and of the buyer to accept and pay for them, in accordance with the terms of the contract of sale.CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 11 of 27
32. Payment and delivery are concurrent conditions.--Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer shall be ready and willing to pay the price in exchange for possession of the goods.
33. Delivery. - Delivery of goods sold may be made by doing anything which the parties agree shall be treated as delivery or which has the effect of putting the goods in the possession of the buyer or of any person authorised to hold them on his behalf."
29. It is the case of the plaintiff that upon the order placed by the defendant goods were delivered and accepted by defendant to be paid for later on and plaintiff has filed the present suit to recover the price of the goods so supplied. How the suit of the plaintiff is contrary to the provisions of The Sales of Goods Act, 1930 especially Section 31 to 33, has not been explained by Ld. Counsel for defendant. This Court on its own does not find that suit of the plaintiff is contrary to the Sales of Goods Act, 1930 especially Section 31 to 33. Hence, issue No.3 is decided against the defendant and in favour of the plaintiff.
ISSUE No. 4:- Whether the plaintiff is entitled to recovery of suit amount along with interest, as prayed for? OPP.
30. Onus to prove this issue is upon the plaintiff. It is the case of the plaintiff that both plaintiff and defendant had been doing business for 10 years before entering into distributor agreement dt 06.12.2018 executed between them for a period of two years i.e. till 06.12.2020. As per plaintiff in Para 2(xiii) of the said agreement, the previous debt of Rs. 58,99,185/- was duly acknowledged as CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 12 of 27 payable by the defendant. It is pleaded that during the normal course of business, it supplied goods to the defendant on his order and invoices of outstanding amount have been raised during the said period and are governed by the terms of the said invoices and that of agreement. Remaining invoices were governed by the terms and conditions stated in the said invoices and a sum of Rs. 46,81,703/- is claimed to be outstanding.
31. Defendant has denied any liability to pay or to clear outstanding and has substantially devoted himself to raise the bar of limitation. He has denied every pleading and contention of the plaintiff, however, he did plead that it was not him but plaintiff that had requested him to develop business relations with them. He, however, did not plead whether or not any business relation took place. He categorically denied execution of distributor agreement dt 06.12.2018 or that he had admitted therein previous liability of Rs. 58,99,185/-. He was thus in denial mode.
32. His testimony, however, in cross examination was completely not in consonance with his stand in written statement. He admitted that he used to sell shoes of brand Liberty and that of the plaintiff. He admitted that he had been selling the shoes of the plaintiff since year 2000. He claimed that all payments due to the plaintiff were made on time. He admitted that he used to have running account with the plaintiff. He had shown his ignorance as to why the present dispute had arisen as he had made all the payments that CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 13 of 27 were due. He deposed that all goods supplied by the plaintiff were delivered at his Patiala address. He also deposed that goods were supplied to him via trucks through courier companies. He deposed that all goods that were supplied were received by him and receipts were signed by him. He deposed that he had paid for the goods that were supplied to him. He, however, did not remember whether the amount of goods supplied to him ranged from Rs 10 to 50 lacs. He further deposed that all the business with plaintiff was done before Nov, 2020. He also admitted his signature on the Distributor Agreement dt 06.12.2018 at point A. He also admitted that courier receipt/LR/delivery proof Ex PW2/1 (colly) bore his signature available page No. 4, 13, 14 and 36 forming part of Ex PW2/1. He further deposed that he could not say whether the goods that were stated to be delivered through invoices in question were delivered to him or not as long time had passed and because the records were destroyed in the fire in godown in Nov, 2020.
33. Above testimony of defendant when examined in conjunction with position taken by him in his written statement, exposes him bare thereby destroying his credibility. One fail to understand that when defendant had so much facts concerning transaction between plaintiff and himself, then why he chose to deny distributor agreement dt 06.12.2018, denied admission of previous liability in agreement dt 06.12.2018, did not plead alleged entire payments of all goods received by him etc. Defendant did not choose to make responsible pleading appropriate to transaction between the CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 14 of 27 parties. The responsibility of speaking truth in the court is not only of plaintiff but it is equally the duty of the defendant to speak truth in the court and place all relevant materials.
34. Further, he did not bring any evidence to the effect that there was fire at his place in Nov, 2020 and all his business records were burnt and therefore in the absence of evidence to that effect, his non-production of his running account being maintained with plaintiff renders him liable for drawing of an adverse inference, particularly regarding his case set up during the cross examination of the plaintiff's witness that goods were not delivered under the invoices in question.
35. Plaintiff examined two witnesses from transporter to prove delivery of goods to the defendant. PW2 Sh. Puneet Khanna from Safexpress Pvt. Ltd. brought 50 original delivery receipts. He deposed that delivery receipts bore the signature and seal of M/s Ankur Shoe Sales. He further deposed that delivery receipts were the records which were maintained by Safexpress Pvt. Ltd. for the service of transportation rendered to Campus Activewear Pvt. Ltd. All 50 receipts were exhibited as Ex PW2/1 (colly) and next time he further brought four more receipts and same were exhibited as Ex PW2/2(colly). In his cross examination he deposed that he did not know Naresh Goyal and that all the bilties Ex PW2/1 (colly) and Ex PW2/2 (colly) were issued by Safexpress Pvt. Ltd. He deposed that order for transportation of the concerned goods was CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 15 of 27 given to Safexpress by the plaintiff company. He further deposed that goods were dispatched from different places like Baddi, Ambala, Dehradun. He further deposed that he could not tell from the invoices as to what were the good transported as the bilties were handed over to the consignee. He again said at some places that the word 'footwear' was mentioned in some of the bilties.
36. PW3 Sh Vijay Kumar Singh from Gati Express & Supply Chain Pvt. Ltd. brought original docket No. 293410057 having e-way bill No. 2880177287735 Ex PW3/B bearing the signature and stamp of the defendant. In his cross examination he deposed that he did not know Naresh Goyal and that docket Ex PW3/B was issued by Gati Express & Supply Chain Pvt Ltd. He further deposed that goods concerned were ordered by the defendant from the plaintiff and that goods were dispatched from Baddi, HP. He deposed that he was not aware of the details of the goods.
37. From the cross examination of PW2 and PW3 it is clear that defendant is not disputing delivery of goods from/through bilties Ex PW2/1(colly), Ex PW2/2 (colly) and docket Ex PW3/B. All of them have seal of defendant firm and many of them bears the signature of the defendant himself. He also admitted his signature on four of them. Many of the invoices bears his signature which can be said on the basis of comparison under Section 73 of the BSA. Further in view of defendant's credibility having been destroyed as a result of his testimony in cross examination when CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 16 of 27 compared with his stand in his WS, his attempt to dispute delivery of goods does not inspire confidence of the court and rather plaintiff's witness PW2 and PW3 have proved delivery of goods of plaintiff through Courier vide receipts/dockets Ex PW2/1 (colly), Ex PW2/2 (colly) and Ex PW3/B pertaining to period between 09.04.2019 to 30.09.2020. Moreover, aforesaid facts got corroborated by defendant's admission about his signature on some of the bilities forming part of Ex PW2/1 (colly) and about the fact that goods used to be delivered to him through trucks. Further, defendant in his cross examination categorically did not deny receipts of goods through the invoices in question. Thus, going by the preponderance of probability, plaintiff has successfully proved the delivery of goods through the Transporters vide their receipts Ex PW2/1(colly), Ex PW2/1 (colly) and Ex PW3/B.
38. Once delivery of goods is proved onus shifts upon the defendant to prove its payment. Ld. Counsel for defendant contended that witnesses PW2 and PW3 did not know what were the goods but contention of the Ld. Counsel for defendant is not sustainable because initially defendant did not take any stance in his WS and later on when deliveries were proved, he himself did not plead or explain as to what goods were received from plaintiff through transporters if not the 'footwears' manufactured by plaintiff. Hence, inability of PW2 and PW3 to tell what goods were delivered will not be fatal to the case of the plaintiff. Moreover, a CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 17 of 27 staffer from transporter who brought record is not supposed to know the contents of the goods packed in the packages.
39. Ld. Counsel for the defendant sought to entangle the issue of liability of the defendant stating that plaintiff did not explain the opening balance of Rs. 48,53,199/- as on 01.04.2019 shown in the ledger Ex PW1/6 and also the fact of two debit entries of Rs. 18,50,000/- and Rs. 16,60,000/- on 03.09.2019 and 04.09.2019 respectively. However, attempt of the Counsel for defendant could not keep the attention of the court engaged for long for two reasons, firstly when plaintiff's witnesses particularly PW1 and PW4 were in the witness box no question were asked to them to explain the opening balance of Rs. 48,53,199/- as on 01.04.2019 and secondly defendant in his cross examination admitted his signature on Distributor Agreement dt 06.12.2018 Ex PW1/4 wherein defendant in paragraph 2(xiii) admitted his previous liability of Rs. 58,99,185/-, even though in his written statement he had denied execution of such agreement. From 06.12.2018 to 31.03.2019 defendant might have discharged part liability and that's why opening debit balance as on 01.04.2019 was Rs. 48,53,199/-. Defendant did not lead any evidence to the effect that between 06.12.2018 and 31.03.2019 he had cleared the said outstanding of Rs. 58,99,185/-. It is true that if plaintiff had placed on record the ledger of previous period as well, that would have been better but under the circumstances as discussed above same is not fatal to the case of the plaintiff.
CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 18 of 2740. The other contention regarding the debit entries on 03.09.2019 and 04.09.2019, it must be said that if defendant wanted to highlight discrepancy or questioned the said entries, first of all he should have specifically pleaded about the same or at least should have put questions to the concerned witness PW1 and PW4. Ld. Counsel for defendant contended that he had specifically asked both the witnesses as to whether plaintiff was in the business of money lending. This question is very general question whereas this would have been relevant if plaintiff had pleaded that it had lent any money to defendant or to other at the instance of the defendant. No one can understand that this general question was with respect to specific debit entries on 03.09.2019 and 04.09.2019 in the ledger. Even this court till the time defendant did not raise above contention, was wondering as to why defendant had asked PW1 and PW4 as to whether or not plaintiff was in money lending business. Surprises in adversarial litigation is not permitted except to a limited extent during the cross examination of a witness. In civil suits both parties must know each others case and must be aware well in advance as to what all they are required to meet at trial. Hence, above raised contention of the defendant is not sustainable.
41. Nevertheless, objecting to the contention of the defendant being beyond pleading, it was submitted by Counsel for plaintiff that the aforesaid debit entries were with respect to the channel financing facilities availed by the defendant as per clause 2(xiv) of the CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 19 of 27 agreement dt 06.12.2018 Ex PW1/4. He submitted that with respect to said facility, plaintiff was liable to pay to the bank the outstanding loan amount upon the default by the defendant. He contended that aforesaid entries under the heading "refund" related to the said payments which were made by the plaintiff to Yes Bank upon default by the defendant to pay the said lender bank and therefore the ledger correctly reflected the outstanding amount due as it considered all the payments which had been made by the defendant.
42. If at all the defendant had disputed the particular debit entries specifically in his pleading the way he had done during final argument, or at least during the cross examination, plaintiff would have had chance to explain the same with evidence but defendant in his WS raised only vague plea that too in whole denial mode and later on admitted many of the aspects of dealings between the plaintiff and defendant as noted above, therefore defendant does not stand to gain by raising the aforesaid issue now in final argument even though explanation put forth by the plaintiff in final argument cannot be accepted without evidence. Thus, the contention of the defendant is not hereby sustained in law for the reason discussed above.
43. Ld. Counsel for the defendant further attempted to destroy the case of the plaintiff by drawing attention of the court to the minor discrepancy and contradictions in the testimonies of the PW1 and CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 20 of 27 PW4. But this court is of the view that the minor discrepancies or contradictions in the testimonies of the PW1 and PW4 are bound to happen when both witnesses are from different branches of the plaintiff. Nevertheless, their minor discrepancies/contradictions in the testimonies does not make any dent in case of the plaintiff regarding supplies of goods through invoices in question from 09.04.2019 to 30.09.2019 coupled with proofs of delivery and admissions of the defendant as noted above. Further, defendant did not chose to send reply to the legal notice dt. 19.04.2021 forming part Ex PW1/8 (colly) wherein plaintiff had demanded the outstanding as claimed in the present suit, even though he chose to sent reply and counter rejoinder to legal notice dt 16.04.2021. Hence, defendant's silence to legal notice dt 19.04.2021 also calls for drawing of an adverse inference against him.
44. Ld. Counsel for defendant had also raised an objection qua the territorial jurisdiction of this court, however, no issue in this regard was framed vide order dated 24.07.2024. Ld. Counsel for defendant contended that defendant carries on business in Patiala, Punjab, which does not fall within the jurisdiction of this court. He further contended that plaintiff has not placed on record any document showing that the goods were delivered or that any contract was executed within the jurisdiction of this court. Perusal of record reflects that distributor agreement dt 06.12.2018 was executed in Delhi. Plaintiff in its pleading had averred that the same was executed at the registered office of the plaintiff which is CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 21 of 27 within the jurisdiction of this court. The defendant in its cross examination had admitted his signatures on the distributor agreement dt 06.12.2018 meaning thereby that he was a party to this agreement. The execution of agreement dt 06.12.2018 gives rise to part cause of action arising within the territorial jurisdiction of this court. Therefore, as per Section 20( c) of CPC, this court has jurisdiction to try the present suit.
45. Much emphasis was laid by Ld. Counsel for the defendant on the fact that in the two legal notices dated 16.04.2021 and 19.04.2021 issued by plaintiff, different amounts were demanded, and thus two legal notices of the plaintiff itself destroys the case of the plaintiff. However, contention of Ld. Counsel for defendant is not sustainable. In the notice dated 16.04.2021, the plaintiff demanded a sum of Rs. 88,144/- towards three specific invoices of November 2019, whereas in the subsequent notice dated 19.04.2021, the plaintiff demanded the entire outstanding of Rs. 46,55,438/- for the period 09.04.2019 to 30.09.2020. It is to be kept in mind that a legal notice is not a pleading and does not determine substantive rights of parties. Any inconsistency, omission or mistake in a legal notice cannot, by itself, defeat a claim otherwise proved by reliable documentary and oral evidence. Legal notices are only a mode of pre-litigation demand and not determinative of the merits of the case, and any clerical, arithmetical or drafting error therein cannot override proved accounts, admitted dealings and established liability.
CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 22 of 2746. In the present case, the evidence on record clearly establishes that the parties were having a running and continuous business account, with long-standing dealings extending over many years. The ledger account Ex PW1/6, supported by delivery proofs Ex PW2/1 (colly), Ex PW2/2 (colly) and Ex PW3/B, along with admissions of the defendant, clearly establishes that goods worth Rs. 46,81,703/- were supplied during the relevant period and that the amount claimed represents the outstanding balance after accounting for all payments and adjustments.
47. The first legal notice dated 16.04.2021 appears to have been issued with reference only to three invoices of November 2019, possibly arising out of a limited reconciliation exercise or immediate dispute regarding those invoices. However, upon a detailed reconciliation of the entire running account, the plaintiff issued the subsequent comprehensive notice dated 19.04.2021 demanding the entire outstanding amount. Merely because the first notice did not refer to the full outstanding does not, in law, amount to waiver, abandonment or admission of limitation of claim.
48. The accounts between parties must be examined as a whole, and not in fragmented isolation. Where a running account exists, the cause of action is continuous, and the outstanding balance becomes payable upon final settlement or termination of business relations. Therefore, issuance of a partial demand notice does not preclude the creditor from raising a comprehensive claim CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 23 of 27 subsequently, especially when no settlement or accord and satisfaction is pleaded or proved by the debtor.
49. As regards the contention that the three invoices referred in the first notice do not appear in the ledger Ex PW1/6, the same, in the considered opinion of this Court, does not discredit the entire ledger or claim. In commercial accounting practice, invoices may sometimes be adjusted, merged, squared off, or re-accounted through credit notes, debit notes or journal entries. For the said amount there appears to be journal entry on 25.09.2022. The defendant, despite having full opportunity, failed to confront PW1 or PW4 specifically regarding these three invoices, failed to summon his own books of accounts, and failed to produce any contrary ledger or statement nor could prove fire at his place. In such circumstances, minor accounting discrepancies cannot override the overwhelming documentary and oral evidence establishing supply of goods, delivery thereof, and subsisting outstanding liability.
50. Further, the defendant has admitted the business relationship ( not in WS but in his cross examination as well as in his reply to legal notice vide reply dt 29.04.2021 and rejoinder dt.17.05.2021), admitted receipt of goods, admitted running account, admitted his signatures on multiple delivery receipts, and admitted execution of the distributor agreement acknowledging earlier liability. His plea of destruction of records due to fire remains unsupported by any CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 24 of 27 documentary evidence, thereby attracting adverse inference under Section 114(g) of the Indian Evidence Act.
51. The minor variations in figures reflected in the two legal notices, the plaint, and internal accounting tables does not amount to material contradictions so as to demolish the plaintiff's case. It is trite in law that civil cases are decided on the touchstone of preponderance of probabilities and not on mathematical precision. Once supply of goods, delivery, running account, and acknowledgment of business relationship stand proved, minor discrepancies in accounting details cannot be permitted to defeat substantive justice.
52. On the contrary, the defendant has completely failed to discharge the onus of proving payment. He has not produced any receipt, bank statement, ledger, voucher, or independent proof of discharge of liability. His denial in the written statement stands contradicted by his own admissions in cross-examination, thereby rendering his defence unreliable and unworthy of credit.
53. Hence, in view of above discussion and reasoning, issue No. 4 so far as principal outstanding is concerned, is decided in favour of the plaintiff and against the defendant.
54. Plaintiff has also demanded interest @ 18 % per annum on the outstanding from 30.09.2020. But perusal of ledger maintained by the plaintiff in the name of the defendant firm shows that CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 25 of 27 defendant had not been paying bill wise which means plaintiff and defendant were having running account. Hence to claim interest at the rate of 18% per annum would not be justifiable.
55. Nevertheless, since the transaction between the plaintiff and defendant was admittedly commercial and any holding of amount adversely affect the party whose money has been held up, hence plaintiff is certainly entitled to interest to compensate for the loss which it suffered due to non-availability of fund.
56. In Central Bank of India v. Ravindra (2002) 1 SCC 367, the Supreme Court held interest must be reasonable. In the case of Cimmco Limited Versus Pramod Krishna Agrawal 2019 SCC OnLine Del 7289, it is held as follows;
"3..........Hon'ble Supreme Court has now mandated that lower rates of interest be granted and therefore the pre-suit and also the pendente lite and future interest is liable to be reduced by this Court. Reliance is placed upon the judgments in the cases of Rajendra Construction Co. v. Maharashtra Housing & Area Development Authority, (2005) 6 SCC 678, McDermott International Inc. v. Burn Standard Co. Ltd., (2006) 11 SCC 181, Rajasthan State Road Transport Corporation v. Indag Rubber Ltd., (2006) 7 SCC 700, Krishna Bhagya Jala Nigam Ltd. v. G. Harischandra, (2007) 2 SCC 720 & State of Rajasthan v. Ferro Concrete Construction Pvt. Ltd. (2009) 3 Arb. LR 140 (SC)."
57. In view thereof since it is commercial transaction plaintiff is hereby held entitled to simple interest @ 9% per annum on the outstanding from 01.04.2021 (from the start of new accounting year) till whole amount is realised. Further since it was the conduct CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 26 of 27 of the defendant which compelled the plaintiff to initiate legal action against the defendant, therefore, plaintiff is also entitled to the cost of the suit.
58. In view of above discussion and reasoning, issue No.4 is decided in favour of the plaintiff and against the defendant to the extent that plaintiff is hereby held entitled to recovery of principal sum of Rs. 46,38,572/- along with simple interest at 9% p.a. Relief
59. In view of the findings recorded on all issues hereinbefore, the suit of the plaintiff is hereby allowed and a decree for recovery of Rs. 46,38,572/- (Rupees Forty Six Lakhs Thirty Eight Thousand Five Hundred and Seventy Two Only) is hereby passed in favour of the plaintiff and against the defendant, with cost and simple interest @ 9% p.a. from 01.04.2021 till actual realisation.
60. Decreesheet be prepared accordingly.
61. File be consigned to Record Room after necessary compliance.
HARISH Digitally signed by
HARISH KUMAR
KUMAR Date: 2026.02.26
15:32:59 +0530
(Harish Kumar)
District Judge (Commercial)-04
Announced in the open court District West, Tis Hazari Courts
(Judgement contains 27 pages) Delhi/26.02.2026
CS(Comm) No.212/2024 Campus Activewear Ltd. v. Naresh Goyal DoJ 26.02.2026 Page 27 of 27