Delhi District Court
M/S Hewelett Computer Paper Industries vs M/S Skypark Services Specialists on 22 March, 2007
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IN THE COURT OF SHRI D.C.ANAND
ADDL.DISTRICT JUDGE:DELHI.
Suit No.163/06
M/s Hewelett Computer Paper Industries
....Plaintiff
Versus
M/s Skypark Services Specialists
Limited ....Defendant
ORDER
1. This order shall dispose of leave to defend application filed by the defendant in the form of affidavit stating therein that defendant has not been supplied with the documents produced and relied upon by the plaintiff either along with plaint as per order 37 R 3 or with summons of judgment and hence entitled to unconditional leave to defend.
2. Further, the suit is not maintainable as the 2 plaintiff is not a registered partnership firm which has also ceased to exist from 1.3.2006 as informed by one of the partner of the plaintiff through whom the suit was filed which fact was also concealed from this court. The jurisdiction of this court is also challenged as the jurisdiction to file the suit lies in the state of Bombay where cause of action arose. Further, there was no agreement to pay interest @ 24% p.a.
3. On merits, it was stated that the plaintiff firm had agreed to supply the goods at the price of the counter-offer of defendant company and the goods were supplied late which were of inferior quality which was agreed to be replaced by the plaintiff and thereafter Rs. 60,000/- was sent vide cheque and demand note and as per understanding the plaintiff firm was to send the 3 revised bill with a discount of 35% on the total bill to the defendant company at Bombay for final payment. The defendant further stated that meantime the defendant company consumed the inferior quality goods.
4. The plaintiff contested the application as illusory, sham and frivolous defence which require no indulgence by this court as the suit has been filed to recovery the liquidated demand in money on the basis of a written contract/bill or invoice between the plaintiff and the defendant. The defendant also has not raised any triable issue which entitled them to grant leave to defend the suit under any condition especially when they admitted the supply of goods and balance payment.
5. Regarding supply of the copies of the 4 documents the plaintiff submitted that original bills/invoices on which the present suit is based are in possession of the defendant and there are no documents which has been filed which is not in the possession of the defendant company. Besides, this can never be a ground to entitle the defendant for any unconditional leave to defend.
6. On jurisdiction the plaintiff submitted that purchase order were issued by the defendant from their regional office from Delhi and the invoices, cash memo/bills between the parties were accepted by the defendants at the Delhi office which carry instruction that all disputes between the parties will be subjected to Delhi jurisdiction.
7. It is an admitted fact that plaintiff has placed reliance on agreement dated 1st day of April 2006 5 so as to say that suit is maintainable by them as liability against the defendant for a sum of Rs. 1,86,520/- was not part of the sale consideration with M/s K.G. Data Forms Private Limited which was incorporated under the Companies Act, 1956 who has taken over the liabilities and assets from the plaintiff as per annexure to the agreement. This agreement is on stamp paper of Rs. 100/- whereas the liability which was not part of the agreement is for Rs. 1,86,520/- besides the other liabilities and assets which were transferred by the plaintiff to M/s K.G. Data Forms Private Limited and as such the agreement need to be stamped in accordance with the Stamp Act and not on a stamp paper of Rs. 100/- as pointed out by the Learned counsel for the defendant. This aspect is a matter of 6 trial prima facie and considering the authorities as laid down in the case of M/s Sudarshan Talkies (Delhi) Private Limited Vs. The Chief Controlling Revenue Authority, Delhi and others reported in AIR 1978 Delhi 162; Chief Controlling Revenue Authority, Board of Revenue, Madras Vs. Tvl. Inca Cables (Private) Limited, Madras reported in AIR 1982 Madras 113, wherein their Lordship observed that "The purchase price of these shares was mentioned as Rs. 1,45,354.58 which was not paid in cash but by conveying the property mentioned in Form 3 by giving possession. In the premises the Chief Controlling Revenue Authority rightly held that "the purchase price of the property including the immovable assets of the partnership was a consideration for the 7 allotted shares" and that "the particulars filed under sub sec (2) of S.75 in Form 3 would attract stamp duty as prescribed for a conveyance of immovable property.
It is clear that the document in question cannot by any stretch of imagination be a release deed and it can only be a conveyance within the meaning of S.2(10) of the Indian Stamp Act and as such stamp duty has to be levied under Art. 23 of Sch. I to the Stamp Act. The reference is answered accordingly."
I hold that defendant is entitled to leave to defend on this aspect only especially keeping in view the observations of their Lordship in the case of Jagatjit Industries Limited Vs. Rajiv Gupta reported in 18 (1980) DLT 434 as made in para 9 which reads as under:
"The stamp duty has not been paid in accordance with Article 35 of the Stamp Act and therefore I am also of 8 the view that this deed is not duly stamped in accordance with law. As the document is not duly stamped it cannot be looked into at all. Section 35 of the Stamp Act, 1889 provides that any instrument not duly stamped is inadmissible in evidence for any purpose. Thus I am of the view that the lease deed cannot be referred to at all."
8. Their Lordship in the case of Laxmi Narain Gupta Vs. Suraj Bhan Daruka reported in 88 (2000) DLT 570 observed that defence raised by the defendant in the application about maintainability of the suit under Order 37 CPC on the basis of insufficiently stamped documents cannot be termed as a sham or moonshine inviting refusal to the grand of the leave prayed for. In this context Learned counsel for the defendant also made reference to section 64 and 9 65 of the Evidence Act as the plaintiff has not placed documents in original along with suit filed under Order 37 CPC and the documents which are copies cannot be read in evidence so as to deny the right/leave to defend of the suit to the defendant. Reference was also made to section 17(c) of the Registration Act so as to say that agreement on which basis suit has been filed is not registered which require registration under the Act else the same cannot be read in evidence. Otherwise also the liability of the defendant towards plaintiff was only for Rs. 1,86,520/- as per this agreement while suit has been filed for a principal sum of Rs. 2,14,686/- without mention of the agreement in question as well as liability of the defendant for that amount which also prima facie gives a right to 10 defend the suit to the defendant in term of agreement even if the same is considered to be admissible for collateral purposes as sought to be argued by the Ld. counsel for plaintiff .
9. As already discussed, the plaintiff has not supplied the copies of the documents relied upon by them mere because the originals are with the defendant, as pleaded in the reply to the leave to defend application/affidavit. This admission of non supply of the documents further goes against the plaintiff in term of observations of their Lordship in the case of Hans Raj Vs. Lakhi Ram reported in 114 (2004) DLT 264 wherein their Lordship were of the view that "where only copy of the summons without affixing the copy of plaint and annexures thereto were affixed by the process server, the service of 11 summons is insufficient and it is sufficient circumstance to set aside a decree passed under Order 37 CPC". Here, the plaintiff despite objection is adamant not to supply the documents to the defendant which entitled him to leave to defend the suit.
10. However, regarding interest the plaintiff has placed reliance on the cash memo which contains payment of interest @ 24% . Regarding agreement it has been submitted by the Ld. counsel for plaintiff that transfer of running business by itself will not bring about dissolution of the partnership firm of the plaintiff and as such he is within his rights to file the suit independently of agreement. In this connection reference is made to the case of Radha Soami Satsang Sabha Vs. Pawan 12 Electric Refrigerating Co. and another reported in AIR 1967 Allahabad 9. The observations of their Lordship that "transfer of the running business by itself not bring about dissolution" was in different context as in the present suit as per their own letter dated 20.3.2006 placed on record by the defendant, the defendant was informed by the plaintiff that M/s K.G. Data Forms Private Limited has taken over the plaintiff firm from 1.3.2006 so all orders/bills/cheques are to be issued in favour of M/s K.G. Data Forms Private Limited. This suit was filed on 20.4.06 i.e after taking over of the plaintiff by M/s K.G. Data Forms Private Limited.
11. The submissions as made by the Learned counsel for the defendant in this context are 13 matter of triable issue who has also challenged the admissibility of the agreement which can only be decided during evidence by the parties. I am not able to accept the submissions by the Ld. counsel for plaintiff that mere on technical grounds whereas the defendant has not put forward a good defence on merits, this suit cannot be thrown out of the ambit of order 37 CPC and need to be decreed. The reference made to the case of Bush Boake Allen (India) Limited Vs. Mehtajee and Company & Ors reported in II (2006) BC 427 is of no avail to the plaintiff as the technical objections too are to be taken into consideration so as to see whether defendant has a good defence which is prima facie not a moonshine or illusory or ex facie unbelievable.
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12. Considering the totality of the circumstances, I grant leave to defend the suit to the defendant but on deposit of liability amount as per agreement i.e Rs. 1,86,520/- which the defendant shall deposit in the court within a month from today and shall be withdrawn by the plaintiff on submission of indemnity bond.
Announced in open Court Dated: 22.3.2007 (D.C. Anand) Addl. District Judge, Delhi.