Delhi District Court
Sanjeev Aggarwal Prop Of M/S P S Polymers vs Prashant Gupta Prop Of M/S Suntex Cables on 27 August, 2025
IN THE COURT OF MS. KIRAN BANSAL:
DISTRICT JUDGE (COMMERCIAL COURT-02
SHAHDARA DISTRICT
KARKARDOOMA COURTS : DELHI
Civil Suit (Comm) No. 434/2023
In the matter of
SANJEEV AGGARWAL,
Proprietor of M/s P.S. Polymers
1/422, Gali No.6, Friends
Colony,
Industrial Area, Shahdara,
Delhi - 110095
.... Plaintiff
Vs.
Prashant Gupta,
Proprietor of M/s Suntex Cable Industries
Plot No.2227, Street No.6,
Baba Gajja Jain Colony,
Moti Nagar, Ludhiana,
Punjab - 141008
Also at
House No.2227, Street No.32,
Ludhiana, Punjab - 141010
Mob. No.8749000001, 9872402227
Email: [email protected] .... Defendant
Date of Institution :24.08.2023
Date of final arguments :09.06.2025
Date of conclusion :27.08.2025
JUDGMENT
1. This is a suit filed against the defendant for recovery of Rs.11,28,762/- along with pendente lite interest @ 18% per Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:05:54 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.1 OF 44 annum on the decretal amount from the date of filing of suit till its realization.
2. Briefly stated the facts of the case are that plaintiff is proprietor of M/s P.S. Polymers working as Manufacturer and Dealer of PVC compounds and plastic granules having its factory at Shahdara, Delhi. Defendant approached the plaintiff and represented himself as proprietor of M/s Suntex Cables Industries and showed his willingness to purchase the goods and thereafter, defendant started purchasing the goods on credit basis and plaintiff timely supplied the same as per satisfaction and order of defendant from his factory situated at Shahdara District. As per books of accounts/ledger maintained by plaintiff in ordinary course of business of financial year 01.04.2020 to 31.03.2021, an amount of Rs.15,28,762/- was due and payable by defendant for supply of goods by the plaintiff.
2.1 Plaintiff requested many times to defendant to make payment, but, he failed to heed the requests and kept on delaying the payment on one pretext or other. A legal notice dated 07.01.2020 was served upon the defendant to pay the outstanding amount of Rs.15,28,762/-, but, the said notice was neither complied nor replied by him. Plaintiff has complied the provisions of Commercial Courts Act, 2015 and instituted pre suit mediation, but, defendant did not participate in the same and non starter dated 23.02.2021 was issued. Plaintiff stated that to show his bona fide, defendant had made total payment of Rs.4,00,000/- on 07.01.2022, 03.03.2022 and 05.04.2022 and subsequently the outstanding amount is Rs.11,28,762/- (i.e.Rs.15,28,762-Rs.4,00,000) payable by the defendant. Again, legal notice dated 12.12.2022 was served upon the defendant to Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:06:01 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.2 OF 44 pay the outstanding amount of Rs.11,28,762/-, but, the same was neither complied nor replied by him. Plaintiff filed pre institution mediation, but, the same got failed and non-starter report dated 26.04.2023 was issued. The cause of action arose in favour of plaintiff and against the defendant as despite service of legal notice, the defendant has not made payment and the cause of action is stated to be still continuing. Further, it is stated that the valuation for the purpose of court fee and jurisdiction is fixed at Rs.11,28,762/- on which requisite ad valorem court fee of Rs.13,400/- has been paid. Plaintiff stated that present suit is filed within limitation as plaintiff received the last payment from the defendant on 05.04.2022. Further, it is stated that subject matter of suit is commercial dispute as defined in Section 2(1)(c)(i) of Commercial Courts Act, 2015 i.e. "Ordinary transactions of the merchants". Further, plaintiff supplied the goods to defendant from his factory situated at Shahdara, Delhi, thus, the present court has jurisdiction to try and adjudicate the present suit.
Statement of Truth of Sh. Sanjeev Aggarwal also filed along with the plaint.
3. WS along with list of documents, affidavit of admission and denial of documents filed on behalf of defendant. In the WS, it is stated that plaintiff has concealed the previous litigation initiated under Section 18 of MSMED Act, 2006 filed by M/s PS Polymers in respect of same transaction against the defendant and showed Ms. Sharda Rani as Proprietor of M/s P S Polymers. It is stated that M/s P S Polymers is not registered firm and plaintiff has not filed any registered document regarding his proprietorship firm, thus, plaintiff is not entitled to file commercial suit for recovery. Defendant stated that if the first Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:06:08 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.3 OF 44 invoice dated 31.07.2017 filed with plaint is considered then cause of action first arose on 31.07.2017 and the suit is time barred and filed beyond three years and repeated legal notice beyond three years do not extend limitation. Further, it is stated that transactions between plaintiff and defendant were of Rs.15,28,762/-, however, the suit of plaintiff is for recovery of Rs.11,28,762/- and the plaintiff has relied upon invoices filed alongwith plaint and total amount of invoices is Rs.13,00,706/-, instead of Rs.15,28,762/-. Further, it is also an admitted fact that defendant had paid Rs.4,00,000/- as part payment and after deducting the said amount from Rs.13,00,706/-, the outstanding comes to Rs.9,00,706/-, thus, the demand in legal notice is not legally recoverable as total amount of invoices comes to Rs.13,00,706/- instead of Rs.15,28,762/- and also debt is time barred debt.
3.1 Further, it is stated that suit of plaintiff is liable to be dismissed due to lack of territorial jurisdiction as defendant resides and runs his business at Ludhiana in Punjab and whatever business transactions held between plaintiff and defendant, were held in Ludhiana. Further, it is stated that plaintiff has not mentioned date and year when defendant approached him. It is submitted that Ledger Account and Invoices filed by plaintiff are false and fabricated as plaintiff has not deliberately filed complete ledger account of financial year 2017 to 2018. Further, as all the invoices belongs to year 2017 to 2018, therefore, the suit of plaintiff is time barred. It is submitted that on 28.10.2018, defendant paid Rs.3,28,131/- to plaintiff and confirmed the payment via whatsapp chat sent from his mobile no.9212708574 at defendant's mobile nos. 9569100001, 9872402227 and plaintiff Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:06:17 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.4 OF 44 requested to pay the rest amount to Monu (cousin brother of defendant and son of his land lady of premises where plaintiff used to run his factory). It is further submitted that at the instance of plaintiff, defendant paid Rs.3,00,000/- to Monu on 30.10.2018, Rs.5,00,000/- on first week of November, 2018 and further paid Rs.4,00,000/- as mentioned in plaint. Further, it is submitted that plaintiff has not mentioned any date and year, when he requested the defendant to pay the amount, however, the defendant has made full and final payment and suit of the plaintiff is liable to be dismissed. Defendant stated that the legal notice sent by plaintiff is wrong as the total balance amount admitted on 28.10.2018 as per plaintiff's whatsapp chat is Rs.12,00,631/-, therefore, no question arises to send legal notice demanding Rs.15,28,762/-, thus, the defendant has no liability to pay in this regard.
4. Replication was filed on behalf of plaintiff denying that plaintiff has concealed the previous proceedings initiated under Section 18 of MSMED Act, 2006, however, plaintiff has filed a claim against defendant before MSMEF council District Shahdara, but, defendant opted not to attend, and vide order dated 26.08.2022, conciliation proceedings were terminated and the matter was referred to DIAC. Plaintiff has stated that he never filed any civil suit against the defendant with respect to the present transaction, thus, the question of bar under Section 10 CPC does not arise. It is submitted that defendant has neither filed his ledger statement or bank statement reflecting that defendant has paid all the due amount. Further, it is submitted that defendant has running account in books of accounts of plaintiff and plaintiff has received the last payment of Rs.1,00,000/- from the defendant on 05.04.2022.
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2025.08.27
13:06:24
+0530
CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.5 OF 44 4.1 Plaintiff submitted that he has supplied the goods worth Rs.15,28,762/- to the defendant, however, while filing the suit three invoices bearing no. 0006, dated 10.07.2017, 0007, dated 12.07.2017 and 0012, dated 15.07.2017, inadvertently were not filed along with plaint. Further, plaintiff has admitted that defendant has made payment of Rs.4,00,000/-, leaving balance of Rs.11,28,762/-. It is submitted that Ms. Sharda Rani is not the proprietor of M/s PS Polymers and Mr. Sanjeev Aggarwal is the Proprietor of M/s PS Polymers.
4.2 Plaintiff has denied that at the instance of plaintiff, defendant paid Rs.3,00,000/- to Monu on 30.10.2018 and Rs.5,00,000/- on first week of November, 2018. Lastly, it is submitted that plaintiff has received the last payment of Rs.1,00,000/- from the defendant on 05.04.2022, thus, the suit is filed well within limitation.
Remaining averments made in the WS were denied and the contents of the plaint are reiterated.
5. Plaintiff had filed the 3 Invoices along with replication and also filed an application under Order XI Rue 1(5) CPC seeking permission to place on record the additional documents in answer to the case set up by defendant. The said application was allowed vide order dated 30.04.2024 and the additional documents in the form of abovesaid 3 Invoices and GST Certificate of the plaintiff's firm was taken on record.
6. During admission / denial, the defendant has not Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:06:32 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.6 OF 44 admitted any of the documents of the plaintiff. On the other hand, the plaintiff in his affidavit of admission/denial of documents has not denied the document of defendant i.e. Copy of the proceedings under Section 18 of the MSMED Act, 2006 initiated on behalf of the Proprietor of M/s. P.S. Polymers against the defendant is Ex.D1.
7. On the basis of pleadings of parties, following issues are framed for consideration:
i. Whether the suit of the plaintiff is barred under Section 10 CPC? OPD.
ii. Whether the suit of the plaintiff is barred by law of limitation? OPD.
iii. Whether the present court does have territorial jurisdiction to try and decide the present suit? OPD. iv. Whether the plaintiff is entitled for money decree? If so, to what amount? OPP.
v. Whether the plaintiff is entitled to any interest? If so, at what rate and for which period? OPP. vi. Relief.
8. In support of its case, Sh. Sanjeev Aggarwal, Proprietor of M/s P.S. Polymers has examined himself as PW-1 and tendered his evidence by way of affidavit on 18.07.2024 which is Ex.PW1/A and has relied upon the following documents:
• Statement of Ledger Account from financial year 2017 -
2018 to 2021 - 2022 as Ex.PW1/1A;
• Statement of Ledger Account (from financial year 2022 -
2023 as Ex.PW1/1;
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2025.08.27
13:06:39
+0530
CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.7 OF 44 • Original Invoices (21 in number) as Ex.PW1/2 to Ex.PW1/22;
• Office Copy of legal notice dated 12.12.2020 as Ex.PW1/23;
• Office Copy of legal notice dated 07.01.2020 as Ex.PW1/24;
• Speed Post Receipt as Ex.PW1/25;
• Original Non Starter Report dated 26.04.2023 as
Ex.PW1/26;
• Original Non Starter Report dated 23.02.2021 as
Ex.PW1/27;
• Copy of GST Certificate as Ex.PW1/28;
• Affidavit under Order XI Rule 6 CPC as Ex.PW1/29.
• Affidavit under Section 65(B) of Indian Evidence Act,
1872 as Ex.PW1/30.
He was duly cross examined on behalf of defendant. Thereafter, PE was closed on his statement.
9. In rebuttal, the defendant Sh. Prashant Gupta, Proprietor of M/s Suntex Cables Industries examined himself as DW-1 and has tendered his evidence by way of affidavit Ex.DW1/A on 27.07.2024.
• Copy of the case proceedings u/s 18 of the MSMED Act, 2006 initiated on behalf of the proprietor of M/s P.S. Polymers against the defendant are Ex.DW1/1(colly- running pg.21 to 29);
• Copy of whatsapp chat and ledger account are Ex.DW1/2(colly- running pg.30 to 31);
• Declaration on oath by way of affidavit read as certificate u/s 65B of the Indian Evidence Act is Ex.DW1/3.
Digitally signed by KIRANKIRAN BANSAL BANSAL Date:
2025.08.27 13:06:47 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.8 OF 44 He was cross examined by ld. counsel for plaintiff.
9.1 Sh. Manish Jindal was examined as DW-2. He was cross examined at length by ld. counsel for plaintiff. DW-2 Sh. Manish Jindal in his chief has deposed that the plaintiff was a tenant in their premises from 2010 to 2021 and initially, the rent was Rs.28,500/- per month which was increased to Rs.45,000/-
per month. He has further stated that the plaintiff used to pay Rs.14,000/- of the rent through online mode and the rest he used to pay in cash. Further, he has stated that in the year 2018, Sh. Sanjeev Aggarwal i.e. plaintiff was in arrear of rent of approximately 8 to 9 lakhs and that he has received Rs.3 lakhs from Sh. Arvind Arora on behalf of plaintiff in October, 2018 and after some days he has further received Rs. 5 lakhs from the defendant at his house and thus, he has in total received Rs.8 lakhs towards arrears of rent at the instance of plaintiff, out of which Rs.5 lakhs was paid by defendant and 3 lakhs was paid by Sh. Arvind Arora. During cross he has admitted that his mother Smt. Sharda Rani was the owner of the tenanted premises and the rent was approximately Rs.28,500/- in the year 2010 when the premises was given on rent to the plaintiff and there was an increment of 5% in rent on annual basis. During cross, he has admitted that a rent agreement was executed between his mother and the plaintiff. Further, DW-2 improved his version that rent agreement was initially executed between his father and Sh. Sanjeev Aggarwal. He stated that he does not have copy of the rent agreement. The Rent Agreement executed between the mother of DW-2 and the plaintiff was shown to DW-2 by the counsel for plaintiff and DW-2 identified the signatures of his mother on the said Rent Agreement which is Ex.DW2/PX1.
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2025.08.27
13:06:54
+0530
CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.9 OF 44 As per this Agreement dated 01.06.2015, the rent was Rs.14,500/- per month.
9.2 Sh. Arvind Arora was examined as DW-3, who proved the copy of Aadhar Card Ex.DW3/1. He was also cross examined by ld. counsel for plaintiff. DW-3 Sh. Arvind Arora has stated that he knows the plaintiff as well as the defendant as both of them are having business dealing. He has further stated that the defendant has told him to give Rs.3 lakhs to Mr. Monu @ Manish Jindal and he has given Rs.3 lakhs to Mr. Monu @ Manish Jindal on 30.10.2018. During cross, he has stated that the plaintiff was not present at the time when he has given the payment to Mr. Monu @ Manish Jindal. He has further stated that he does not know whether the said amount of Rs.3 lakhs has been paid to the plaintiff or not. As per testimony of DW-3, it is the defendant who had told him to give the payment to DW-2 Sh. Manish Jindal of 3 lakhs, which he has paid. He has further stated he does know whether Mr. Monu @ Manish Jindal has further paid Rs.3 lakhs to the plaintiff or not and whether the said amount was adjusted towards rent or not. He has also not made the payment on behalf of defendant to the plaintiff directly.
9.3 Sh. Pushpender Kumar Data Entry Operator from D.M. Shahdara Office, MSEFC Branch, Nand Nagari, a summoned witness examined as DW-4 has brought the record of proceedings initiated between M/s. P.S. Polymers and M/s. Suntax Cable Industries before MSEFC, D.C. Office Complex, D.M. Shahdara Office, Delhi and the proceedings initiated by M/s. P.S. Polymers dated 01.11.2020 before MSEFC and has Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:07:01 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.10 OF 44 proved the entire record of said proceeding Ex.DW4/1 (colly).
Thereafter, DE was closed on the statement of ld. counsel for defendant.
10. The court has heard ld. counsel for the plaintiff as well as ld. counsel for the defendant and have also gone through the records of the case and the written submissions filed. The findings on the issues are as under:
ISSUE No. (i) Whether the suit of the plaintiff is barred under Section 10 CPC? OPD.
11. The onus to prove this issue was upon the defendant. The defendant has stated that earlier proceedings between the parties (M/s P S Polymers and M/s Suntex Cables Industries) under section 18 of MSMED Act, 2006 were initiated, and therefore, the present suit is barred by Section 10 CPC.
12. In this regard, the plaintiff has stated that vide order dated 26.08.2022, the conciliation proceedings were terminated and matter was referred to DIAC for initiating arbitration proceedings. However, the plaintiff did not approach DIAC for the commencement of arbitration proceedings rather filed the present commercial suit. The plaintiff further stated that he has never filed a civil suit prior to the present suit so as to attract the provision of Section 10 CPC.
13. For the purpose of deciding the present issue, it would be relevant to refer to section 10 CPC. It is re-produced as follows:
Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:07:09 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.11 OF 44 "10. Stay of suit: No Court shall proceed with the trial of any suit in which the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties, or between parties under whom they or any of them claim litigating under the same title where such suit is pending in the same or any other Court in India have jurisdiction to grant the relief claimed, or in any Court beyond the limits of India established or continued by the Central Government and having like jurisdiction, or before the Supreme Court.
Explanation-The pendency of a suit in a foreign Court does not preclude the Courts in India from trying a suit founded on the same cause of action."
14. In this regard, it would be relevant to refer to case of Aspi Jal and Anr. vs. Khushroo Rustom Dadyburjor AIR 2013 SUPREME COURT 1712 wherein it was held by Hon'ble SC that in order to attract the provision of Section 10 CPC, the test for applicability of Section 10 of the Code is whether on a final decision being reached in the previously instituted suit would act as resjudicata on the subsequent suit. The relevant part of the judgement is as follows:
"From a plain reading of the aforesaid provision, it is evident that where a suit is Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:07:19 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.12 OF 44 instituted in a Court to which provisions of the Code apply, it shall not proceed with the trial of another suit in which the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties. For application of the provisions of Section 10 of the Code, it is further required that the Court in which the previous suit is pending is competent to grant the relief claimed. The use of negative expression in Section 10, i.e. "no court shall proceed with the trial of any suit" makes the provision mandatory and the Court in which the subsequent suit has been filed is prohibited from proceeding with the trial of that suit if the conditions laid down in Section 10 of the Code are satisfied. The basic purpose and the underlying object of Section 10 of the Code is to prevent the Courts of concurrent jurisdiction from simultaneously entertaining and adjudicating upon two parallel litigations in respect of same cause of action, same subject matter and the same relief. This is to pin down the plaintiff to one litigation so as to avoid the possibility of contradictory verdicts by two courts in respect of the same relief and is aimed to protect the defendant from multiplicity of proceeding.
.....Digitally signed by KIRAN
KIRAN BANSAL Date:
BANSAL 2025.08.27 13:07:28 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.13 OF 44 The only question which invites our adjudication is as to whether "the matter in issue is also directly and substantially in issue in previously instituted suits". The key words in Section 10 are "the matter in issue is directly and substantially in issue in the previously instituted suit"".
15. Thus, following essentials are required to be fulfilled in order to apply the bar of Section 10 CPC:
i. There must be two suits, one previously instituted and other subsequently instituted.
ii. The matter in issue in subsequent suit must be directly and substantially in issue in the previous suit. iii. The parties in the previous suit and the subsequent suit are the same.
iv. The parties are litigating under the same title in both the suits.
v. The previously instituted suit must be pending in the same court in which the subsequent suit is brought or in any other court in India or in any court beyond the limits of India established continued by the Central Government or before the Supreme Court.
vi. The Court in which the previous suit is instituted must have jurisdiction to grant the relief claimed in the subsequent suit.
16. In the present case, the contention of the defendant is that the suit of the plaintiff is liable to be stayed as the plaintiff has initially approached the MSME Council u/s 18 of the Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:07:38 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.14 OF 44 MSMED Act and thereafter, the matter was referred to arbitration. Therefore, another civil proceedings between the parties can not be continued in view of Section 10 CPC.
17. On the other hand, the plaintiff has accepted the fact that he has approached the MSME council and the matter was also referred to arbitration. However, the contention of the plaintiff is that he did not pursue the arbitration proceedings rather he preferred to institute the present suit. Thus, section 10 CPC does not applies.
18. The defendant has produced the copy of proceedings before MSME Council which is Ex. DW-1/1. The defendant has also summoned the witness from SDM office who has also produced the same copies. The same is Ex. DW-4/1.
19. Perusal of the same reveals that initially the plaintiff has approached the MSME Council for recovery of dues of 15 lacs. In Ex. DW-1/1 principal amount is provided as Rs. 15,28,762/-. However, it is admitted by the defendant that he had made a payment of Rs. 4,00,000 on 07.01.2022, 03.03.2022 and 05.04.2022 during after proceedings of the MSME Council.
20. At the outset it is pertinent to mention here that for application of Section 10 CPC, the primary requirement is that a previously instituted suit is pending in the same or any other court. However, this pre-requisite itself is not fulfilled as the conciliation proceedings before the MSME facilitation council were terminated vide order dated 27.05.2022 (Ex. DW-4/1) and it was referred to arbitration. However, it is also equally pertinent Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:07:46 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.15 OF 44 to mention here that the plaintiff did not opt to initiate the arbitration proceedings rather approached the present court by way of civil suit. Thus, no proceedings were pending at the time of institution of the present suit between the same parties.
21. At this stage, it is pertinent to mention here that the MSME facilitation council conducts conciliation between the parties and that per se can not be said to be a civil suit. There is a stark difference between the conciliation proceedings and civil suit. The Hon'ble SC in the case of M/s Afcons Infrastructure Infra Ltd vs M/s Cherian Varkey Construction Co. Pvt Ltd. SLP (C) No.760 of 2007 decided on 26.07.2010 has referred to conciliation as non-adjudicatory process. The relevant part of the judgement is as follows:
"25. Conciliation is a non-adjudicatory ADR process, which is also governed by the provisions of AC Act. There can be a valid reference to conciliation only if both parties to the dispute agree to have negotiations with the help of a third party or third parties either by an agreement or by the process of invitation and acceptance provided in section 62 of AC Act followed by appointment of conciliator/s as provided in section 64 of AC Act. If both parties do not agree for conciliation, there can be no 'conciliation'."
22. On the other hand, the civil suit is in form of adjudicatory process and is binding process. Since the conciliation proceedings were terminated and no arbitration Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:07:54 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.16 OF 44 proceedings were initiated thus, no proceedings were pending and thus, the rigour of Section 10 CPC is not attracted to the present case.
23. It is also equally important to mention here that the MSME Facilitation council is a quasi-judicial body and is not a court for the purpose of Section 10 CPC. It is a creation of a statute and derives its power from the statute itself.
24. Thus, since the Facilitation council was acting as a conciliation forum where the adjudication of the suits did not take place and was not acting as a court, thus, the proceedings in the present suit cannot be held to be stayed in terms of Section 10 CPC and are not hit by Section 10 CPC.
25. As far as the proceedings being referred to the arbitration is concerned, it was never initiated by the DIAC or the plaintiff. Also, the defendant had not contended that the arbitration proceedings were initiated. Also, there was no arbitration clause between the parties to refer the disputes to the arbitration. Thus, in view of no arbitration proceedings initiated by the plaintiff and no arbitration clause being agreed between the parties, the proceedings of the present case were not liable to be stayed as per section 10 CPC. Section 10 CPC does not apply in the facts and circumstances of the case, as discussed above and the objection of the defendant in this respect is devoid of any merit, hence rejected.
Issue no. (i) is, accordingly, decided in favour of plaintiff and against the defendant.
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2025.08.27
13:08:03
+0530
CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.17 OF 44 ISSUE No.(ii)Whether the suit of the plaintiff is barred by law of limitation? OPD.
26. The onus to prove this issue was upon the defendant. The defendant states that suit of the plaintiff is time barred as the transaction pertains to financial year of 2017-18 as the first cause of action arose on 31.07.2017 (date on first invoice). It is further stated by the defendant that the suit is filed beyond three years and any demand letter issued after expiry of three years will not extend the period of limitation. Thus, the suit of the plaintiff is barred by limitation.
27. On the other hand, the plaintiff has denied the averments of the plaintiff and has submitted that the defendant has a running account in the books of accounts of plaintiff and the plaintiff has received a last payment of Rs. 1,00,000/- from the defendant on 05.04.2022. Thus, the suit is filed within period of limitation.
28. Ld. Counsel for the defendant has also relied upon the following judgements to contend that the suit is barred by limitation:
i. Professional Audio Video PTE. LTD. vs. M-3 Media Pvt.Ltd. CO. PET. 441/2016
ii. Delhi Technical University vs Mr. Chander Shekar CRP 155/ 2023 decided on 05.04.2024 (2024:DHC:2758)
29. In the case of Professional Audio Video PTE. LTD. vs. M-3 Media Pvt. Ltd. CO. PET. 441/2016, the petitioner had supplied to the respondent with the goods and the bills were sent Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:08:12 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.18 OF 44 to the respondent on 02.10.2008. Thereafter, the petitioner sent the demand notice in 2015 and filed the instant petition for winding up of the respondent company. In this regard, Hon'ble HC has held that since the dues are based on invoices of 2008 and the present winding up petition have been filed in May 2016, thus, the petition is time barred, as the petition has been filed after 7 years of the raising the bill. Therefore, the petition was dismissed being barred by the limitation.
30. In the case of Delhi Technical University vs Mr. Chander Shekar CRP 155/ 2023 decided on 05.04.2024 (2024:DHC:2758), Hon'ble Delhi HC was dealing with the revision petition challenging the order of trial court whereby the trial court has dismissed the application of the petitioner- defendant under Order VII Rule 11(d) CPC and held that suit of the defendant, prima facie, is within the Limitation period.
31. In the said case, the plaintiff has filed the suit for recovery in 2020 in respect of five work orders from 2012-13. The plaintiff had sent demand letters dated 15.06.2018 and 21.07.2018 which were never replied by the petitioner/ defendant. Further the plaintiff had filed an RTI application dated 21.07.2018 seeking status of the action taken on letter dated 1506.2018. The reply to the said RTI stated that "payment will be made only after scrutiny of bills."
32. Thus, the issue before the Hon'ble HC was whether the suit is prima facie barred by the limitation or not.
33. The Hon'ble HC has held that suit was prima facie Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:08:20 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.19 OF 44 filed beyond three years, in as much as, the plea of the plaintiff- respondent to consider the RTI reply as acknowledgement under Section 18 Limitation Act is concerned, even RTI was filed much beyond three years and therefore, it cannot be considered as valid acknowledgement. Thus, it was held that suit is barred by limitation.
34. Certainly, sending of legal notices does not extends the limitation, but, still both the above said cases are distinguishable from the facts of the present case and cannot be said to be applicable to the present case as the plaintiff has filed the present case on the basis of ledger balance.
35. In the factual matrix of the present case, the case of the plaintiff is for recovery of Rs.11,28,762/- as outstanding amount reflected at the foot of the Ledger account maintained by the plaintiff. The first invoice was issued by the plaintiff on 10.07.2017 for an amount of Rs. 66,127/-. Thereafter, plaintiff has issued various invoices till 18.06.2018, last invoice bearing no. 0125.
36. The prescribed period for filing suit for recovery is three years if the payment is made invoice wise. The date of last invoice is 18.06.2018 and the period of three years would have expired on 18.06.2021. Since the Hon'ble SC in the IN RE:
COGNIZANCEFOR EXTENSION OF LIMITATION SUO MOTU WRIT PETITION (c) NO.3 OF 2020 has order exclusion of the time from 15.03.2020 to 28.02.2022 in computation of period of limitation. Thus, even after applying the same, the period of limitation would have expired on 03.06.2023. The Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:08:30 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.20 OF 44 plaintiff has also complied with pre-institution mediation. Perusal of the record reveals that the plaintiff has complied with pre- institution mediation twice. The two non starter reports are dated 26.04.2023 (Ex. PW-1/26) and 23.02.2021 (Ex. PW-1/27).
However, the plaintiff will be entitled to the exclusion of duration of only one non-starter report. Thus, the period undergone while complying with the second pre-institution mediation from 20.02.2023 to 26.04.2023 has also to be excluded. After excluding this time the period of limitation would have extended upto 08.08.2023, if the suit was filed only on the basis of invoice and the payment was also made invoice wise.
37. However, since the plaintiff has filed the present suit on the basis of the outstanding amount reflected in the ledger and upon perusal of the ledger, it is clear that the payment was not made on bill-to-bill basis rather 'ON ACCOUNT' basis. Moreover, since the plaintiff used to supply the goods to the defendant and defendant was obliged to pay the money, thus, the account in question is a running, open and non-mutual account in terms of judgement of Bharath Skins Corporation vs Taneja Skins Company Pvt. Ltd. 2011:DHC:6571-DB decided by Hon'ble Delhi HC. The relevant part of the judgement is as follows:
"20. In case of a running and non-mutual account between the buyer and seller, when goods are delivered by the seller to the buyer, the value of the goods is debited in the debit column and when amounts are paid by the buyer to the seller, they are entered in the credit column. The difference is Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:08:37 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.21 OF 44 continuously struck in the column for balance. In such a case, when the buyer defaults to make balance payment, the seller's action is not for the price of goods sold and delivered but for the balance due at the foot of an account. Thus, Article 14 would have no application in suits of recovery of money due on a running and a non-mutual current account between the buyer and seller.
23. The upshot of the above discussion is that Article 14 of the Schedule to the Limitation Act, 1963 does not apply to suits for recovery of money due on a running and current but a non-mutual account between the buyer and seller i.e. an account of the kind with which we are dealing. 24. There being no Article in the Schedule to the Limitation Act, 1963 dealing with suits for recovery of money due on running and current but non-mutual accounts, in such circumstances, the residual article viz. Article 113 applies to such suits."
38. The judgement of Bharath Skins Corporation vs Taneja Skins Company Pvt. Ltd. was also relied upon in case of Motilal Oswal Securities Ltd vs Rakshak Kapoor & Anr. (OMP (Comm) 169/2016) decided by Hon'ble Delhi HC on 26.11.2019.
39. Thus, even in the present case, the limitation period would be governed by Article 113 of The Limitation Act and thus, cause of action also arose when the last payment of Rs. 1,00,000/- was made by the defendant on 05.04.2022. Thus, the period of three years would expire on 05.04.2025. Therefore, the Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:08:45 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.22 OF 44 suit is filed within period of limitation.
Issue no. (ii) is accordingly decided against the defendant and in favour of plaintiff.
ISSUE No. (iii) Whether the present court does have territorial jurisdiction to try and decide the present suit? OPD
40. The defendant has stated that no cause of action has arisen within the territorial jurisdiction of the present court. Moreover, the defendant resides and runs his business in Ludhiana, Punjab and cause of action also arose there. Thus, the present court has no territorial jurisdiction to try the present court.
41. The plaintiff has denied this averment of the defendant and has stated that the present court has territorial jurisdiction to try the present suit as the defendant had supplied the goods to the defendant from his factory which is situated in Shahdara, Delhi. Thus, it is stated that present court has territorial jurisdiction to try the present suit.
42. The present suit is a suit for recovery of the outstanding balance and thus, the territorial jurisdiction would be governed by Section 20 of CPC. As far as the application of section 20 is concerned, Hon'ble Delhi HC in the case of Rana Sugars Limited vs Bajaj Electricals Limited 2017:DHC:3689 has observed as follows:
"12. It is seen that the provision of Section 20 CPC allows filing of a suit against a defendant under two broad heads. The first Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:08:52 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.23 OF 44 broad head is with regard to arising of whole or part of cause of action and where a contract is entered into between the parties then cause of action arises wholly or in part where the contract is executed or where performance under the contract has to be done or where payment is made or is to be made under the contract and at such three places the courts would have territorial jurisdiction to decide the disputes arising between the parties to the contract. The first broad head is the subject matter of sub- section (c) of Section 20 CPC. The second broad head of Section 20 CPC is that a suit can be filed against a defendant where the defendant resides and/or voluntarily works for gain and/or carries on business. The second broad head allows filing of a suit even if cause of action has not accrued at the place where the defendant resides and/or works for gain and/or carries on business. The second broad head is the subject matter of sub- sections (a) and (b) of Section 20 CPC."
43. In the present case, the perusal of the record shows that invoice(s) were issued from the address of the plaintiff i.e. 1/429/14, Gali No. 1, Friends Colony Indl. Area, Shahdara, Delhi- 110095. The plaintiff has stated that the goods were supplied from the factory of the plaintiff situated within the territorial jurisdiction of this court.
Digitally signed by KIRANKIRAN BANSAL Date:
BANSAL 2025.08.27 13:09:00 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.24 OF 44
44. It is also pertinent to note here that the invoices raised by the plaintiff contains a clause that the "Dispute if any will be subject to seller's court jurisdiction only". Moreover, the orders were placed by the defendant to the plaintiff at his registered place of business which falls within the territorial jurisdiction of this court. Placing of orders to the plaintiff within the territorial jurisdiction of this court gives rise to part of cause of action within territorial jurisdiction of present court.
45. The defendant was required to prove by adducing some cogent, documentary evidence that goods were not supplied from here or that no cause of action had arisen within the territorial jurisdiction or the present court. The defendant has not produced any such document. Mere bald averments in the WS that present court does not have territorial jurisdiction cannot be accepted.
46. Moreover, since the goods were dispatched from factory situated at Shahdara, a part of cause of action has arisen within the territorial jurisdiction of the present court. Even as per the GST Registration Certificate, the principal place of business of the plaintiff is Plot No. 1/422, Gali No. 6, Industrial Area, Friends Colony, New Delhi Shahdara, Delhi-110095.
47. Perusal of the record reveals that no place of payment was agreed between the parties, thus, by applying the principle of 'debtor seeks creditor', payments were to be made where the plaintiff works for gain or carries on business. In the present case, the plaintiff carries on his business at Plot NO.
Digitally signed by KIRANKIRAN BANSAL Date:
BANSAL 2025.08.27 13:09:08 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.25 OF 44 1/422, Gali No. 6, Industrial Area, Friends Colony, new Delhi, Shahdara, Delhi- 110095 which falls within the territorial jurisdiction of this court.
48. Since the orders were placed by the defendant to the plaintiff within the territorial jurisdiction of this court, the goods were dispatched from the territorial jurisdiction of this court and also by applying the principle of 'Debtor seeks creditor', the present court, thus, has territorial jurisdiction to try the present suit.
Issue no. (iii) is, accordingly, decided in favour of plaintiff and defendant.
ISSUE No.(iv)Whether the plaintiff is entitled for money decree? If so, to what amount? OPP.
49. The onus to prove this issue was upon the plaintiff. The present suit is commercial in nature and squarely falls within the purview of Section 2 (1) (C) of Commercial Courts Act and plaintiff has also duly complied with mandatory provision of Pre-Institution Mediation and Conciliation as provided in Section 12 A of Commercial Courts Act, as per the Non-Starter Report dated 26.04.2023 Ex.PW1/26.
50. The present suit has been filed on 24.08.2023. For the purposes of reference, it is important to discuss the relevant timelines and dates concerning the present suit. The first invoice involved in the present suit is of 10.07.2017 for an amount of Rs. 66,127/-. Thereafter, the business dealings between the parties continued till 18.06.2018 when an invoice for amount of Rs. 78,376/- was issued by the plaintiff to the defendant. At the end of the business dealings a total of Rs. 15,28,762/- was reflected Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:09:15 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.26 OF 44 as outstanding amount at the foot of the ledger account. In the year 2022, the defendant made a part payment of Rs. 4,00,000/- on three different occasions (Rs. 2,00,000/- on 07.01.2022, Rs. 1,00,000/- on 03.03.2022 and Rs. 1,00,000/- on 05.04.2022 by way of bank transfer). Thus, the last payment was received on 05.04.2022.
51. It is also equally important to note that in the meantime the plaintiff has also initiated the conciliation proceedings before the MSME Facilitation council. The said proceedings were instituted on 01.11.2020 and was terminated on 27.05.2022. The suit filed by the plaintiff is also well within the period of limitation as discussed above in issue no. (ii). Moreover, the present court has territorial jurisdiction to try the instant suit as discussed above.
52. The plaintiff has filed a suit for the recovery of money of Rs. 11,28,762/- against the defendant on the ground that plaintiff had supplied the goods to the defendant but the defendant had not paid the entire amount of the goods and only part payment of Rs.4,00,000/- was made in 2022, when the plaintiff had instituted proceedings before MSME Facilitation council.
53. It is further the case of the plaintiff that initially a sum of Rs. 15,28,762/- was total outstanding amount payable by the defendant. However, the defendant had paid Rs. 4,00,000/- to the plaintiff on 07.01.2022, Rs.1 lakh on 03.03.2022 and Rs.1 lakh on 05.04.2022 thus, leaving Rs. 11,28,762/- as outstanding amount payable by the defendant. The plaintiff states that after Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:09:23 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.27 OF 44 that the defendant had not paid any amount and thus, he has filed the present suit.
54. On the other hand, the defendant has stated that as per plaintiff total transaction between the plaintiff and defendant was of Rs. 15,28,762/- and the suit for recovery filed by the plaintiff is for Rs.11,28,762/-. However, defendant has stated that the total amount of invoices is Rs.13,00,706/- instead of Rs. 15,28,726/-. Further the defendant has admitted that he has paid Rs.4,00,000/- and thus, outstanding amount would be Rs. 9,00,706/-. Hence, the suit of the plaintiff is liable to be dismissed.
55. Another defence taken by the defendant is that he has already paid and cleared the entire outstanding dues as he had paid Rs. 3,28,131/- to the plaintiff on 28.10.2018 and that the plaintiff has confirmed the same via Whatsapp chat. The stand of the defendant is that at the instance of plaintiff, defendant had paid Rs.3,00,000/- to Monu on 30.10.2018 and Rs.5,00,000/- in first week of November, 2018 and Rs.4,00,000/- as mentioned by the plaintiff in the plaint. Thus, no amount is outstanding on the defendant and the suit of the plaintiff is liable to be dismissed.
56. At the outset, it is relevant to mention that as per stand of the defendant, he has paid an amount of Rs. 15,28,131/- (Rs.3,28,131/- on 28.10.2018, Rs. 3,00,000/- on 30.10.2018, Rs. 5,00,000/- in first week of November, 2018 and Rs. 4,00,000/- as mentioned in the plaint). Thus, the plea of the defendant that outstanding amount as per invoices is Rs.13,00,706/- instead of Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:09:30 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.28 OF 44 Rs.15,28,762/- is not sustainable in as much as if the outstanding amount was of Rs.13,00,706/- only, (as per invoices filed by the plaintiff) then why the defendant, had himself, paid Rs. 15,28,131/-. Thus, this plea of the defendant is not sustainable.
57. At this stage, it is also pertinent to note that invoices dated 10.07.2017, 12.07.2017 and 15.07.2017 and ledger account for financial year 2017-18 and 2020-21 were filed by the plaintiff along with application under Order XI Rue 1(5) CPC which was allowed vide order dated 30.04.2024. The total amount of the said Invoices is Rs.2,28,056/- and after adding the said amount of the Invoices with the amount of the Invoices which were filed by the plaintiff initially, the total amount comes to Rs.15,27,762/-. All the 21 Invoices are Ex.PW1/2 to Ex.PW1/22.
58. Now coming on to merits of the case, the defendant has admitted the payment of Rs.4,00,000/- made to plaintiff on 07.01.2022, 03.03.2022 and 05.04.2022. Also, the defendant has not disputed the delivery of the goods and the defendant has not denied the business relations between the parties. The relevant cross examination of the defendant DW-1 is as follows:
"Q. Have you shown all the invoices filed with the plaint in your GST returns and taken the credit input on your invoices?
A. Yes. I have shown all the invoices filed with the plaint in GST returns and took the credit input on the invoices.
It is correct that I have purchased Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:09:37 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.29 OF 44 goods worth Rs.15,28,762/- from the plaintiff."
59. The defendant in his defence has stated that the plaintiff has sent a ledger account (Ex.DW-1/2) as per which there is no outstanding amount in the name of the defendant. The defendant has also stated that defendant paid Rs.3,28,131/- on 28.10.2018 to the plaintiff and the plaintiff had confirmed the payment via whatsapp chat. The Whatsapp chat and ledger is Ex. DW-1/2. In this regard, the relevant part of the cross examination of the plaintiff/PW-1 is re-produced as follows:
"Q. Whether you have had any Whatsapp chats with the defendant regarding payment and ledger statement of defendant? Ans. Yes.
At this stage, witness is shown page no. 30 as per list of documents attached with the WS regarding ledger (khata).
Q. Whether this khata is in your
handwriting?
Ans. Yes.
This Khata is not in respect of dealings between me and the defendant. Ye mera apna personal document hai, mujhe nahi pata ye inke pass kaise pahuncha. Ye general khata hai jisme sabhi logo ka hisab handwritten note karte hai.
I do not remember whether I had sent it to the defendant through Whatsapp or not.Digitally signed by KIRAN
KIRAN BANSAL Date:
BANSAL 2025.08.27 13:09:44 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.30 OF 44 At this stage, witness is shown page no. 31 as per list of documents attached with WS regarding the balance amount of Rs. 12,00,631/- dated 28.10.2018 which was sent by you to the defendant as a whatsapp chat.
Defendant had called me and told that his accountant is not available and that he was transferring Rs. 3,28,131/- and has further told me to tell the balance after deducting this payment and I had sent this balance believing the words of the defendant, but, the payment of Rs.3,28,131/- was never received in my account. It is wrong to suggest that I had received this amount of Rs. 3,28,131/-in cash from the defendant and after receiving cash payment, I had given this balance through whatsapp.''
60. Also, perusal of the said ledger filed by the defendant reveals that page no. 30 of the list of documents, that the same was sent by the plaintiff on 15/12/2017. Thus, it does not show the details of the payment made by the defendant allegedly on 28.10.2018. Moreover, it nowhere mentions the name of the defendant written on it. The relevant part of the DW1's cross examination is as follows:
"Q. Have you received any affirmation from Mr. Sanjeev Agarwal on your whatsapp message dated 30.10.2018 for receiving money?
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2025.08.27
13:09:52
+0530
CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.31 OF 44 A. We never used to send any confirmation to each other. Sending of message itself was considered acknowledgment and confirmation.
It is wrong to suggest that this message was sent to Mr. Sanjeev Agarwal wrongly and he called me thereafter and I told him that message was sent to him wrongly.
It is correct that name of my firm or my name or any date is not mentioned at Ex.DW1/2. (Vol. Plaintiff must not have deemed it fit. "Mujhe Bheja Tha To Meri Firm Ka Hi Hoga")."
61. In this regard, it is also pertinent to note here that the defendant had filed a ledger which was sent by the plaintiff on 15.12.2017. However, the perusal of the Whatsapp screen shot filed by the defendant (Ex. DW-1/2) reveals that the same is screenshot of one of the images allegedly sent by the plaintiff to the defendant. The said page no. 30 also reveals that there were various other images also sent by the plaintiff to the defendant. Similarly, page no. 31 is regarding the whatsapp chat on 30.10.2018, 28.10.2018 and 31.10.2018. Complete whatsapp chat between the parties has not been filed by the defendant on record and only partial whatsapp chat of one or two specific dates has been filed. Copy of one image sent on 15.12.2017 is filed by the defendant. If the defendant wishes that the court should rely upon the said whatsapp chat between the parties, the defendant should have filed complete chat between the parties, Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:10:00 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.32 OF 44 so that the court would have got a clearer picture of what transpired between the parties, instead of filing a partial chat and copy of one one or two pages. Perusal of those two images also reveals that the same is hand written 'kacha khata'. From this hand written notes nothing can be inferred about the payments allegedly made by the defendant. The defendant has stated that he has made a payment of Rs.3,28,131/- on 28.10.2018 in cash, but, no such figure of Rs.3,28,131/- is reflected in the screenshot of the handwritten notes which according to the defendant is the ledger. Thus, for the above stated reason the said whatsapp chat and screenshot of ledger filed by the defendant cannot be considered or relied upon.
62. The defendant has submitted that he had paid entire balance in the year 2018 and last payment was of Rs. 5 lakhs and accounts were completely settled with the plaintiff after this payment and the said payment were made to Monu (DW-2) at Delhi. The relevant portion of the cross examination of the DW-1 is re-produced as follows:
"I have cleared the total payment in the year 2018. The last payment I made to plaintiff firm by way of cash of Rs.5 Lakhs and the said payment was made to one Mr. Monu @ Manish Jindal, who is my cousin brother and also son of Sharda Rani, previous landlord of plaintiff. The accounts were completely settled with the plaintiff after this payment. The said payment was made to Monu at Delhi. I did not take any receipt of the said Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:10:07 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.33 OF 44 payment from Monu. I had made the payment to Monu at the telephonic directions of Sanjeev Agarwal. I have confirmed the fact of receiving of the amount from Sanjeev Agarwal. (Vol. Sanjeev Agarwal was to pay rent to Sharda Rani and Monu and this amount was adjusted probably towards the rent payable by Sanjeev Agarwal). This confirmation was obtained telephonically."
63. Moreover, the defendant has stated that apart from payment of Rs.5 lakhs, he had paid Rs.3 lakhs on request of plaintiff to Monu and the confirmation was delivered telephonically. The relevant cross examination of the defendant (DW-1) is as follows:
"Apart from Rs.5 Lakh, I had paid another amount of Rs.3 Lakhs to Monu at the request of Sh. Sanjeev Agarwal. I received the instructions of paying amount of Rs.3 Lakhs to Monu telephonically from Mr. Sanjeev Agarwal. The said amount Rs. 3 Lakhs was delivered to Monu at Delhi at Shahdara. Mr. Arvind Arora has delivered Rs.3 Lakhs to Monu. I have confirmed from Arvind Arora that he has delivered amount Rs.3 Lakhs to Monu. It is correct that on 30.10.2018, I have sent a whatsapp message regarding transferring of Rs.3 Lakhs to Monu."Digitally signed by KIRAN
KIRAN BANSAL BANSAL Date:
2025.08.27 13:10:14 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.34 OF 44
64. In this regard, it is pertinent to note that after the said payment, a message to this effect was sent by the defendant to the plaintiff and there was no acknowledgment of the said payment by the plaintiff in the chat. Thus, this plea of the defendant is vague and without any cogent evidence that payment was received by the plaintiff. The relevant part of the cross examination of the PW1 in this regard is as follows:
"Ques. As per chat dated 30.10.2018, Rs. 3 Lacs was transferred by defendant to Monu regarding adjustment of the rent of the premises and the said amount was adjusted in the transaction amount between plaintiff and the defendant. What do you have to say? Ans. It is wrong. Both the defendant and Monu are cousins and connived together. Ques. Did you make any query from the defendant regarding the said chat dated 30.10.2018 at 04:12 p.m.?
Ans. I had made a call to the defendant and I asked him as to why he had sent this message and defendant had told me that it was sent to me by mistake and was to be sent to some other person.
Ques. Why you had not objected to the message through Whatsapp?
Ans. I had called the defendant and believing the version of defendant it was wrongly sent, I did not pursue it further."Digitally signed by KIRAN
KIRAN BANSAL BANSAL Date:
2025.08.27 13:10:21 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.35 OF 44
65. As observed earlier, the defendant in his cross examination has stated that account with the plaintiff was settled after he had made the payment of Rs.5 lakhs in 2018. On the other hand, the defendant in his WS has accepted the fact that he had paid Rs.4 lakhs to the plaintiff on 07.01.2022, 03.03.2022 and 05.04.2022. In this regard, the relevant cross examination of the DW-1 is re-produced as follows:
"Q. I put it to you that you settle your entire account with the plaintiff in the year 2017-18 on what account you have made payment on 07.01.2022, 03.03.2022, 05.04.2022, totaling Rs.4 Lakhs to the plaintiff. What do you have to say?
A. Jo Ledger Ko Maintain Karte The Sanjeev Ji Ke Dwara Uska Hisab Khatam Hone Ke Baad Unhone Mujhe Ek Dusri Ledger Bheji Jo Meri Firm Suntex Cables Ke Naam Ki Thi Jisme Unhone Meri Taraf Apna Bakaya 15,28,000/- Around Show Kiya. Toh Uske Regarding Main Inki Factory Me Jakar Visit Ki Jinse Us Time Sanjeev Ji Ne Mere Se Bola Ki Mere Se Galti Se Kuch Entry Chhut Gayi Thi Jiska Inke Paas Koi Proof Nahi Tha. Toh Inhone Pressurize Karke Mere Se Sanjeev Ji Ne 4 Lakh Me Settlement Karaya Jiska Sanjeev Ji Ne Likhit Roop Me Kuch Bhi Dene Se Inkar Kar Diya Tha. 4 Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:10:29 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.36 OF 44 Lakh Dene Ka Koi Time Fix Nahi Tha Vo Mai Apni Sahuliyat Ke Hisab Se Inko De Dunga Ek Ya Do Saal Ke Andar To Ye 4 Lakh Ki Entries. Shuru Se Sanjeev Ji Hi Sara Accounts Maintain Karte The 2014 Se 2018 Tak. Mere Paas Iske Alawa Aur Kuch Nahi Hai.
I have not filed any complaint against the plaintiff for extorting Rs.4 lakhs by pressurizing. I have also not filed any civil suit for recovery of Rs.4 Lakhs against Mr. Sanjeev Agarwal."
66. As per above said testimony of the defendant, the plaintiff has sent him another ledger stating that he had missed some entries in previous ledger. However, the defendant has not produced any such ledger sent by the plaintiff. Moreover, he has stated that only the plaintiff used to maintain the accounts from 2014 to 2018. However, defendant/DW-1 has also stated that he also used to maintain account of the plaintiff.
Relevant cross of DW-1 is as follows:
"Again said, I used to maintain ledger of plaintiff firm also in my books of account. Last purchase was made on 20.06.2018. I cannot tell the exact amount of material purchased from the plaintiff as plaintiff used to keep the account."
67. The defendant, if was maintaining the ledger of plaintiff firm, in his book of accounts, then he should have filed Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:10:36 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.37 OF 44 the same on record. Non filing of the same can only lead to adverse inference. In fact, the defendant in this regard is taking contradictory stand during his cross examination.
Thus, this plea of the defendant is not corroborated by any other evidence and is a mere afterthought to the case of the plaintiff and can not be considered while deciding the case.
68. The defendant has also examined one Mr. Manish Jindal to prove that he has received the payment from defendant on account of plaintiff and said payment was adjusted in rent from Sanjeev Aggarwal. The DW-2 in his cross examination has stated that he used to maintain the account of cash portion of the rent amount and that only a maximum arrear of rent of 10 month was pending. Later on, he deposed that he never used to maintain the record of arrear of rent in writing. The relevant part of the cross examination of DW-2 is as follows:
"I used to keep account of cash portion of the rent amount and never used to keep record of online payments made by Sanjeev Aggarwal. The maximum arrear of rent during the entire tenancy of Mr. Sanjeev Aggarwal was 10 months.
Q. I put it to you that in which year the arrear of 10 month's rent was pending against Mr. Sanjeev Aggarwal?
A. I do not remember in which year the pendency of 10 month's rent was pending against Mr. Sanjeev Aggarwal.
I never used to maintain the record of Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:10:43 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.38 OF 44 arrear of rent in writing."
69. In his chief examination, the DW-2 has deposed that the amount of Rs. 8 lakhs was adjusted in the arrear of rent. The relevant part of the chief examination of DW-2 is as follows:
"I received Rs.8 Lakhs for the adjustment of rent as Sanjeev Aggarwal was in arrear of rent. I used to collect rent from Sanjeev Aggarwal and the said amount of Rs.8 Lakhs was adjusted in rent at the instance of Sanjeev Aggarwal as they had mutually talks regarding the said payment."
70. However, in the cross examination DW-2 admitted the fact that the amount received was not entirely for arrear of rent. The relevant part of the cross of DW-2 is as follows:
"I was also in business dealing with the plaintiff. I was doing the business of copper trading till 2012 and thereafter I was in dealing of trading various articles after 2012. Presently, I am doing the business of manufacturing of denim jeans from the last six months. I used to purchase PVC wire from the plaintiff and used to sell aluminum wire to the plaintiff.
Q. Is it correct that the outstanding amount of Rs.8 Lakhs which you are saying due on Digitally signed by KIRAN KIRAN BANSAL BANSAL Date:
2025.08.27 13:10:50 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.39 OF 44 the plaintiff was entirely not on account of arrear of rent?
A. THODE BAHUT ISME BUSINESS KE DUES BHI JUDE HONGE.
I do not remember prior to 2018, when the last payment of rent was made by the plaintiff. I cannot tell for how many months the rent was not paid by the plaintiff. I do not have any exact calculation of pendency of Rs.8 Lakhs against plaintiff. I cannot tell how much amount out of Rs.8 Lakhs was due on the account of arrears of rent or business transactions."
71. DW-2 has not filed any proof of the fact that the plaintiff was in business transaction with him neither has DW-2 filed any exact calculation of the rent due from the plaintiff. Thus, in absence of any documentary proof adduced by DW-2, the testimony of the DW-2 in this regard can not be considered being not reliable. Also the testimony of DW-2 suffers from various contradictions. It is also important to note here that DW-2 after receiving the payment has neither informed nor acknowledged the payment to the plaintiff. Further, as per rent agreement Ex.DW2/PX1, the rate of rent was Rs.14,500/- per month in the year 2015 when the rent agreement was executed. However, in the statement of DW-2 it has come that rent was increased from Rs.28,500/- per month to Rs.45,000/- per month. Again if the rent was Rs.14,500/- per month in June, 2015 and as per DW-2 rent of more than 10 months was never pending, then by no stretch of imagination it can be said that an amount of Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:10:58 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.40 OF 44 Rs.8,00,000/- was due on account of arrears of rent. During cross examination, when DW-2 could not explain as to how an amount of Rs.8 lakhs was due on account of arrears of rent, then he gave an evasive answer that there may be some business dues also. DW-2 during cross examination has also stated that he knew that defendant was liable to pay some amount to the plaintiff as he said that "kabhi kabhi dono se hi baat chit hoti thi" and he volunteered that "par mughe pata tha ki prashant ne sanjeev ka paise dene hai". The story that the part of the rent amount was paid in cash only seems to have been concocted by DW-2 and the defendant to avoid their liability.
72. The defendant has not filed any documentary proof of the fact that the plaintiff has asked the defendant to make payment to DW-2 on his behalf. Thus, the fact that defendant instead of giving any payment to the plaintiff has transferred all his dues to DW-2, on account of the plaintiff is not acceptable. It is more so important when DW-2 has not given any kind of acknowledgement to the plaintiff or the defendant in writing qua the payment received by him. The defendant has not even explained as to how he secured such huge sum of money in cash and has transferred the same to DW-2. DW-2 has also not clearly stated as to how much was the arrear of rent. Needless to mention that DW-2 is cousin of defendant and is thus, an interested witness.
73. Since the defendant has specifically pleaded that the outstanding amount was paid by the defendant by paying money to Mr. Manish Jindal, the onus to prove these transactions was Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:11:05 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.41 OF 44 upon the defendant and the defendant has failed to discharge his burden of proof. Witnesses produced by defendant i.e. DW-2 and DW-3 are not reliable as their testimony is full of contradictions. DW-2 Sh. Manish Jindal is cousin of defendant, however, in view of the fact that monthly rent as per Ex.DW2/PX1 was Rs.14,500/-, it is not possible that arrears of rent to the tune of Rs.8 lakhs would have accumulated. Even, DW-2 was having business relations with the plaintiff. Also, the defendant has admitted that he has purchased the goods for an amount of Rs.15,28,762/- from the plaintiff. As far as alleged payment of Rs.5 lakhs + Rs. 3 lakhs made by DW-2 to the plaintiff is concerned, the same does not seems to be convincing as the testimony of DW-2 and DW-3 is not reliable. On the basis of preponderance of probabilities, the court is of the opinion that the defendant has not paid this amount to the plaintiff as alleged by him. Also, if he has cleared the total outstanding amount in the year 2018, it is highly unlikely that defendant would pay Rs.4 lakhs to the plaintiff after legal notice and during the proceedings of MSME. The defendant had the liability to pay remaining amount to the plaintiff. The plaintiff has stated that as per ledger maintained by him there is an outstanding dues of the principal amount of Rs.11,28,762/-. The court fails to understand as to why the defendant would make an additional payment of Rs. 4 lakhs in 2022, if he has cleared all the accounts in 2018.
Thus, the plaintiff is entitled to money decree of Rs. 11,28,762/-. Thus, the issue no. (iv) is accordingly decided in favour of plaintiff and against the defendant.
ISSUE No.(v) Whether the plaintiff is entitled to any interest? If so, at what rate and for which period? OPP.Digitally signed by KIRAN
KIRAN BANSAL BANSAL Date:
2025.08.27 13:11:13 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.42 OF 44
74. The plaintiff has prayed for pendente lite interest @ 18% p.a. on the decretal amount from filing of the suit till its actual realization. There is no pleading in the plaint qua the pre- suit interest and the plaintiff has paid court fees only on Rs. 11,28,762/-. The plaintiff has not specified about the pre-suit interest as per Order VII Rule 2A CPC and thus, it seems that the plaintiff has forgone his claim of pre-suit interest. Even, in the prayer clause, plaintiff is seeking interest from the date of filing of the suit.
75. As far as the prayer of the plaintiff to award interest @ 18% p.a. on the decretal amount is concerned, the plaintiff has not led any evidence to suggest that this interest rate was agreed between the plaintiff and the defendant. Moreover, as per the invoices filed by the plaintiff, the rate of interest is 18%, however, it is a settled law that such unilaterally appended terms on the invoices are not valid and can not be enforced.
76. However, the plaintiff is entitled to interest at reasonable rate. In the facts and circumstances of the present case, interest granted at 8% p.a. will serve the ends of justice. Thus, plaintiff is entitled to 8% p.a. on Rs. 11,28,762/- from the date of filing of suit till actual realization, in the interest of justice.
ISSUE No.(vi) Relief.
77. In view of the findings on the above issue, the suit of the plaintiff is hereby decreed in its favour and against the defendant for a sum of Rs.11,28,762/- as principal alongwith pendente-lite and future interest @ 8% per annum on the Digitally signed by KIRAN KIRAN BANSAL Date:
BANSAL 2025.08.27 13:11:21 +0530 CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.43 OF 44 principal amount of Rs.11,28,762/- from the date of filing of suit till actual realization. Plaintiff is also awarded Rs.30,000/- as litigation cost.
Costs of the suit to the extent of court fees is awarded to the plaintiff as per law.
Decree Sheet be prepared accordingly. File be consigned to Record Room.
Digitally
signed by
KIRAN
KIRAN BANSAL
BANSAL Date:
2025.08.27
13:11:29
+0530
Announced in the open court (Kiran Bansal)
on 27.08.2025 District Judge, Commercial Court-02
Shahdara, Karkardooma
Delhi/ 27.08.2025
CIVIL SUIT (COMM) NO. 434/2023 SANJEEV AGGARWALVS. PRASHANT GUPTA PAGE NO.44 OF 44