Delhi District Court
M/S Brindco Sales Private Limited vs Hotel SakithyanChennai on 18 July, 2020
IN THE COURT OF DHEERAJ MOR,
SENIOR CIVIL JUDGECUMRENT CONTROLLER,
SOUTH EAST DISTRICT, SAKET COURT, NEW DELHI
Civil Suit no: 814/19
CNR No. DLSE030011272019
M/S BRINDCO SALES PRIVATE LIMITED
REGD OFFICE:
S53, OKHLA INDUSTRIAL AREA,
PHASEII, NEW DELHI110020. ....... PLAINTIFF
Versus
HOTEL SAKITHYANCHENNAI
42, THANIKACHALAM ROAD,
CHENNAI, TAMILNADU600017 ......DEFENDANT
Date of Institution : 29.04.2019
Date on which judgment was reserved : 18.07.2020
Date of pronouncing judgment : 18.07.2020
SUIT FOR RECOVERY OF RS.73,187/ ALONG WITH PENDENTE LITE
INTEREST @ 18% PER ANNUM AND FUTURE INTEREST @ 24%
PER ANNUM
E X P A R T E JUDGMENT
1.Briefly stated, the case of the plaintiff company is that it is a private limited company incorporated under the Companies Act, 1956 and is India's leading importer and distributor of Alcoholic Beverages with a PAN India presence. It is averred that Sh. Kishore Chandra Sahoo is duly authorized vide Board Resolution dated 25.10.2018 by the Board of Directors of the plaintiff company to institute the present suit.
2. It is averred that the defendant approached the plaintiff at its office situated at S53, Okhla Industrial Area, PhaseII, New Delhi110020 in CS NO.814/19 M/S BRINDCO SALES PRIVATE LIMITED VS. HOTEL SAKITHYAN-CHENNAI Page 1 of 5 the month of November, 2016 with a desire to place an order for the supply of alcoholic beverages and on the basis of its representation, the plaintiff company agreed to sell alcoholic beverages to it. It is averred that it was agreed that the sold alcoholic beverages shall be supplied/transported from the warehouse of the plaintiff at Andhra Pradesh via road to the hotel of the defendant at Tamil Nadu. It is averred that it was also agreed between the parties that in the course of interstate sales, the plaintiff would be entitled to receive "C" Forms from the defendant within a period of three months so as to allow it to take exemption on tax as legally permissible under the law of the land. It is averred that as per Andhra Pradesh VAT Act, sales tax @ 70% is levied on the sale of the goods of the plaintiff. However, if the buyer supplies CForm, against the goods so purchased, then tax is levied as Central Sales Tax @ 2%. However, in case the buyer fails to supply the requisite CForm, he shall be liable to pay the differential 68% tax on the value of the goods purchased.
3. In the present case, the defendant had made the purchase of alcoholic beverages in the financial year 201617 against bill /invoice no. OS/16/00013 dated 05.08.2016 for Rs.76,800/ with CST charged @ 2% i.e. Rs. 1,536/ as raised by the plaintiff. It is averred that the total VAT chargeable under above invoice calculated as per Andhra Pradesh Value Added Tax Act 2005 @ 70% of billed amount is Rs.53,759.74/. However, on the promise of the defendant to supply the CForm, the plaintiff did not charge differential tax Rs. 52,224/from the defendant. However, the defendant failed to supply the required CForm to the plaintiff for the financial year 20162017 which has rendered the plaintiff to suffer additional tax liability of Rs. 52,224/ (Full VAT i.e. Rs.
CS NO.814/19 M/S BRINDCO SALES PRIVATE LIMITED VS. HOTEL SAKITHYAN-CHENNAI Page 2 of 5 53,759.74/, CST paid i.e. Rs.1,535.99) with interest @ 15% by the VAT department, Andhra Pradesh. It is averred that despite repeated requests, reminders, calls and legal notice dated 03.01.2019, for making payment of the outstanding amount including interest or to provide required CForms, defendant failed to comply with the same.
4. It is further averred that on account of default, the defendant is liable to pay interest @ 15% on Rs.52,224/ from the date of tax payment i.e. 20.09.2016 till the payment of the entire dues in the said payment i.e. 20.04.2019 ( which amounts to Rs.20,239/ & TCS of Rs.724.63/). Thus, on the basis of the said assertion, the plaintiff has claimed a total amount of Rs. 73,187/ till 20.04.2019/, after adding the said principal amount and interest thereupon. In addition to the said amount, the plaintiff has claimed pendente lite @ 18% and future interest @ 24% on the said amount. Hence, the present suit.
5. Summons for the settlement of issues were issued to the defendant.
However, despite service, no one appeared on its behalf before the Court. Accordingly, it was proceeded exparte vide order dated 17.07.2019. Then the case was fixed for exparte plaintiff evidence.
6. In exparte plaintiff evidence, the plaintiff has examined only one witness i.e. its AR Sh. Kishore Chandra Sahoo as PW1. He has tendered his evidence by way of affidavit Ex. PW1/1. He has reiterated the contents of the plaint on oath. Therefore, they are not reproduced herein for the sake of brevity and to avoid repetition. He has relied upon following documents:
a) Board Resolution of the company dated 25.10.2018 is Ex. PW1/A;
b) Certificate of Incorporation of company is Ex. PW1/B;
c) TIN/Central Sale Tax No. of defendant is Ex. PW1/C;
d) Invoice dated 23.02.2017 is Ex. PW1/D (colly);
e) Legal notice dated 03.01.2019 is Ex. PW1/E;
CS NO.814/19 M/S BRINDCO SALES PRIVATE LIMITED VS. HOTEL SAKITHYAN-CHENNAI Page 3 of 5
f) Postal and Courier receipts are Ex. PW1/F and Ex. PW1/G respectively; and
g) Notice dated 04.11.2017 of department of trades and taxes are Ex. PW1/H.
7. Vide order dated 04.09.2019, exparte plaintiff evidence was closed.
8. Final arguments are heard. Case file is carefully perused.
9. As per plaintiff, the commercial tax department of Government of Andhra Pradesh has issued a revised show cause notice dated 30.11.2017 Ex. PW1/H to it with a demand to deposit the statutory C forms for their interstate transactions of liquor in the year 20162017 for their total turnover/sale of Rs.3,34,44,122/, failing which, the plaintiff is directed to deposit the tax @ 150% as per ScheduleVI of APVAT Act, 2005. It is the case of the plaintiff that the sale of liquor to the defendant vide invoice Ex.PW1/D was also an interstate transaction during the said period and the defendant has not supplied the requisite and promised CForm for the said purchase. As per plaintiff, the said show cause notice includes the present transaction with the defendant and the amount sought to be recovered by the said department for the default in supply of the requisite CForms is inclusive of the default committed by the defendant in the present transaction. Admittedly, the plaintiff has not yet paid even a single penny to the said department in response to the said show cause notice dated 30.11.2017 Ex. PW1/H. Further, the said show cause notice can be withdrawn by the department in case the plaintiff furnishes the requisite Cforms after their receipt from the defendant. Therefore, the payment towards the demanded tax in response to the said notice is not an absolute demand as it is contingent on the nonfurnishing of the Cforms. Hence, the claim of the plaintiff in this case is premature as in absence of any CS NO.814/19 M/S BRINDCO SALES PRIVATE LIMITED VS. HOTEL SAKITHYAN-CHENNAI Page 4 of 5 payment made by the defendant to the said department, the present suit is without any cause of action. The plaintiff ought to have instituted a suit for mandatory injunction against the defendant thereby seeking directions to the defendant to issue Cform for the said transaction instead of the present suit for recovery. The cause of action for recovery of the amount against the defendant shall only commence after the penalty, if any, is quantified and ascertained qua the present transaction in relation to the alleged default committed by the defendant on the disposal of objections of the plaintiff against the said show cause notice Ex. PW1/H by the tax department and on the payment of the said penalty by the plaintiff to the tax department. Hence, in absence of accrual of any cause of action to institute the present suit, the present suit is bad for being premature and therefore, it deserves to be dismissed. Accordingly, the present suit is dismissed. No orders as to cost.
10. Decree sheet be drawn accordingly.
File be consigned to Record Room after due compliance.
ANNOUNCED IN THE OPEN COURT ON 18.07.2020 (DHEERAJ MOR) Senior Civil Judgecum Rent Controller South East District, Saket Court, New Delhi.
This judgment contains 05 pages and each page is signed by me.
(DHEERAJ MOR) CS NO.814/19 M/S BRINDCO SALES PRIVATE LIMITED VS. HOTEL SAKITHYAN-CHENNAI Page 5 of 5 Senior Civil Judgecum Rent Controller South East District, Saket Court, New Delhi.
CS NO.814/19 M/S BRINDCO SALES PRIVATE LIMITED VS. HOTEL SAKITHYAN-CHENNAI Page 6 of 5