Himachal Pradesh High Court
_________________________________________________________ vs M/S Costal Project Pvt. Ltd. And Others on 3 April, 2018
Author: Sandeep Sharma
Bench: Sandeep Sharma
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA Civil Suit No. 80 of 2016 .
Decided on: April 3, 2018 _________________________________________________________ M/s Dr. R.K. Puri(registered Firm) and others ...Plaintiffs Versus M/S Costal Project Pvt. Ltd. and others ...Defendants _________________________________________________________ Coram:
Hon'ble Mr. Justice Sandeep Sharma, Judge.
_________________________________________________________ Whether approved for reporting? 1 Yes.
_________________________________________________________ For the plaintiffs : Mr. Devender K. Sharma, Advocate.
For the defendants : Defendants No.1 and 2 proceeded against ex parte.
Defendant No.3 deleted.
_________________________________________________________ Justice Sandeep Sharma, Judge(oral).
Instant suit under Order 37 CPC has been filed by the plaintiffs for recovery of `85,83,780/- (principal amount) plus `37,20,538/-(interest) at the rate of 10% per annum upto 20.6.2016, total amounting to `1,23,04,318/- against the defendants, averring therein that plaintiff No. 1 is a Firm registered under Indian Partnership Act, 1932 having its office at H.N. 98/7, Upper Samkhetar Mandi, Himachal Pradesh and plaintiffs No.2 and 3 are the partners of plaintiff No. 1. Earlier Dr. R.K. Puri was the sole proprietor of the plaintiff-
Firm but after his death, plaintiff Nos. 2 and 3 became partners of the 1 Whether reporters of the local papers may be allowed to see the judgment?::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 2
plaintiff-Firm. Plaintiff has also placed on record photocopies of registration certificates, legal heir certificate, partnership deeds and .
death certificates of Dr. R.K. Puri and Dipanshu Puri. As per plaintiffs, they possessed heavy earth moving machinery, which they provided on hire basis. Proforma defendant i.e. National Hydroelectric Power Corporation (deleted from array of parties) awarded work of Hydro Electric Power Project Stage-II Sainj to defendant No. 1 and this work was being executed and supervised by defendant No.1 through defendant No. 2. Defendants No.1 and 2 approached plaintiff-
Firm through its proprietor Dr. R.K. Puri in July, 2011 with a proposal to hire machinery from the firm for excavation work/trenching work on their site. Subsequently defendants No.1 and 2 placed/issued various work orders to the plaintiff-Firm for execution of work on the site.
Detail of work done by the plaintiff-Firm, as has been detailed in the plaint, is reproduced herein below (verbatim):
"SCHEDULE OF WORK
i) Volvo-Excavator-140
(a) This machine is hired by the defendant vide work Order No. 276, dated 1-8-2013 at the monthly rate of Rs.1,85,000/-
P.M. The main terms and condition of this work was that the Diesel is to be provided by the defendants for running the Machine and a log book is also maintained by defendants pertaining to every vehicle in which the details of work done every day by that vehicle is to be recorded, which Log Book is maintained by the site Incharge of defendants No. 1 and 2, on the basis of which the monthly bill is to be prepared and this lo book remained in the custody of the employees of defendants.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 3That vide this work order the machine worked as under:
-
Sr. No.
Period Amount
1. 9-8-2013 to 31-8-2013 1,41,833/-
.
2. 1-9-2013 to 30-9-2013 1,85,000/-
3. 1-10-2013 to 31-10-2013 1,85,000/-
Total 5,11,833/-
Photo Copy of Log Book is attached herewith.
(b) That the above work order No-276 was further extended on dated 1-11-2013 to 30-11-2013, the detail of work done on the spot is duly given in the log-book and the following work is done under the extended order as under:-
Sr. No. Period Amount
1. 1-11-2013 to 30-11-2013 1,85,000/-
Total 1,85,000/-
Photo Copy of Log Book is attached herewith.
(c) That the above work order No-276 was further extended on dated 31-1-2014 and the following work is done under the extended order as under:-
Sr. No. Period Amount
1. 31-1-2014 to 28-2-2014 1,85,000/-
2. 1-3-2014 to 31-3-2014 1,85,000/-
Total 3,70,000/-
Photo Copy of Log Book is attached herewith.
(d) That the plaintiff also worked with the above said machines earlier also as under: -
Sr. No. Period Amount
1. 20-7-2012 to 30-8-2012 2,46,667/-
2. 1-12-2013 to 31-12-2013 1,85,000/-
Total 4.31,667/-
Photo Copy of Log Book is attached herewith.
That the total amount payable by the defendants to the plaintiff for the work done by this Machine for the above referred period comes to Rs.14,98,500/-.
That the amount of interest on this entire payment at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to Rs.4,63,222/-.
As such the total amount alongwith interest of this machine up to 20-6-2016 comes to Rs.19,61,722/-.
ii). Excavator Ex-110 ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 4
(a). This machine is hired by the defendant vide work Order No-07, dated 7-7-2011 at the monthly rate of Rs.1,50,000/- P.M. on the same terms and conditions.
Original of work order No-07 is attached herewith.
.
That vide this work order the machine worked as under:
Sr. No. Period Amount
1. 7-7-2011 to 31-7-2011 1,25,000/-
2. 1-8-2011 to 31-8-2011 1,50,000/-
3. 1-9-2011 to 21-9-2011 1,05,000/-
Total 3,80,000/-
(b). That the defendants also further awarded the work vide Work order No-61, dated 1-10-2011 to this machine.
Original of work order No-61 is attached herewith. That vide this work order the machine worked as under:
Sr. No.Period Amount
1.
r 1-10-2011 to 31-10-2011 1,50,000/-
2. 1-11-2011 to 15-11-2011 75000/-
Total 2,25,000/-
Photo Copy of Log Book is attached herewith.
(c). That the defendants also further awarded the work vide Work order No-232, dated 27-1-2013 to this machine. Original of work order No-232 is attached herewith. That vide this work order the machine worked as under:
Sr. No. Period Amount
1. 27-1-2013 to 27-2-2013 1,30,000/-
2. 28-2-2013 to 31-3-2013 1,30000/-
Total 2,60,000/-
(d). That the above said machine also worked for a following period, the detail of work done on the spot is duly maintained in the log-book and the following work is done under this machine as under:-
Sr. No.Period Amount
1. 20-9-2011 to 30-9-2011 50,000/-
2. 16-11-2011 to 30-11-2011 75,000/-
3. This Machine worked in Dec., 90,000/-
2011 for 18 Days
4. 1-4-2012 to 30-4-2012 1,50,000/-
5. 1-4-2013 to 25-4-2013 1,25,000/-
Total 4,90,000/-
Photo Copy of Log Book is attached herewith.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 5That the total amount payable by the defendants to the plaintiff for the work done by this Machine for the above referred period comes to Rs.13,55,000/-.
That the amount of interest on this entire payment .
at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to Rs.6,77,113/-.
As such the total amount alongwith interest of this Machine up to 20-6-2016 comes to Rs.20.32,113/-.
iii) Excavator CAT-320:
(a). This machine is hired by the defendants vide work Order No-11, dated 08-9-2011, at the monthly rate of Rs.2,50,000/-
P.M. on the same terms and conditions:
Original Work Order No-11 is attached herewith. That vide this work order the machine worked as under:
Sr. No.Period Amount
1.
10-9-2011 to 30-9-2011 1,66,666
2. 1-10-2011 to 31-10-2011 2,50,000/-
3. 1-11-2011 to 10-11-2011 83,333/-
Total 4,99,999/-
Photo Copy of Log Book is attached.
(b). This machine is further hired by the defendants vide work Order Nno-129-A, dated 1-3-2012 on the same terms and conditions: Original Work Order No-129-Ais attached herewith.
That vide this work order the machine worked as under:
Sr. No.Period Amount
1. 1-3-2012 to 31-3-2012 2,50,000/-
2. 1-4-2012 to 30-4-2012 2,50,000/-
Total 5,00,000/-
Photo Copy of Log Book is attached.
(c). This machine is further hired by the defendants vide work Order No-199-A, dated 1-2-2013 on the same terms and conditions. Photo Copy of Work Order No-199-A, Photo Copy of extension letter of work and are attached herewith. That vide this work order the machine worked as under:
Sr. No. Period Amount
1. 1-2-2013 to 28-2-2013 2,50,000/-
2. 1-3-2013 to 31-3-2013 2,50,000/-
3. 1-4-2013 to 30-4-2013 2,50,000/-
4. 1-5-2013 to 31-5-2013 2,50,000/-
5. 1-8-2013 to 31-8-2013 2,50,000/-
6. 1-9-2013 to 30-9-2013 2,50,000/-
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP
6
7.1-10-2013 to 5-10-2013 41,667/-
Total 15,41,667/-
Photo Copy of Log Book is attached.
.
That the total amount payable by the defendants to the plaintiff for the work done by this Machine for the above referred period comes to Rs.25,41,666/-. That the amount of interest on this entire payment at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to Rs.10,44,095/-.
iv) Second Excavator CAT-320:
(a). This machine is hired by the defendants vide work No-
280, dated 14-8-2013, on the same terms and conditions the following work was assigned to the plaintiff by the defendants, which is completed by another Machine. Photo Copy of Work Order No-280 is attached herewith. The details of work as under:
Sr. No. Period Amount
1. 15-8-2013 to 29-8-2013 2,10,000/-
Photo Copy of Log Book is attached.
(b). That the above said machine also worked for a following
period on the same terms and conditions the following work is done under this machine as under:-
Sr. No.Period Amount
1. 11-11-2011 to 30-11-2011 1,66,666/-
2. 1-12-2011 to 31-12-2011 2,50,000/-
3. 1-6-2013 to 30-6-2013 2,50,000/-
4. 1-7-2013 to 31-7-2013 2,50,000/-
Total 9,16,666/-
Photo Copy of Log Book is attached herewith.
That the total amount payable by the defendants to the plaintiff for the work done by these above said Machines for the above-referred period comes to Rs.11,26,666/-.
That the amount of interest on this entire payment at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to Rs.4,50,110/-.
As such the total amount alongwith interest of this Machine up to 20-6-2016 comes to Rs.15,76,776/-.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 7v) That a separate work order No-199, dated 10-8-2012 was awarded by the defendants to the plaintiff for the construction of Coffer Dam and removal of Muck and debris at .
Trench Weir PHEP Stage-II Sainj, which work is to be complete from 10-8-2012 to 25-11-2012 and with mutual discussion, the value of the work is determined as Rs.22,02,355/- (Rupees Twenty Two Lac, Three Thousand Three Hundred fifty Five), which work is also completed by the plaintiff as per to the terms and conditions of the work order with in stipulated time. However, the defendants assessed the value of the work done by the plaintiff on the spot Rs.20,61,918/-. Original Work Order No-199, and completion report of the work are attached herewith.
That the total amount payable by the defendants to the r plaintiff for the work done by him comes to Rs.20,61,918/-.
That the amount of interest on this entire payment at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to Rs.8,38,513/-.
As such the total amount alongwith interest of this Machine up to 20-6-2016 comes to Rs.29,00,431/-.
vi). One ACE HYDRA 12-T:-
This machine is hired by the defendant vide work Order No-07-A, dated 1-8-2011 at the monthly rate of Rs.50,000/- P.M. on the same terms and conditions. Original Work Order No-07A is attached herewith. That vide this work order the machine worked as under:
Sr. No. Period Amount
1. 1-8-2011 to 31-8-2011 50,000/-
2. 1-9-2011 to 30-9-2011 50,000/-
3. 1-10-2011 to 31-10-2011 50,000/-
4. 1-11-2011 to 30-11-2011 50,000/-
5. 1-12-2011 to 31-12-2011 50,000/-
Total 2,50,000/-
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8
Photo Copy of Log Book is attached herewith.
That the total amount payable by the defendants to the plaintiff for the work done by this Machine for the above referred period comes to Rs.2,50,000/-.
.
That the amount of interest on this entire payment at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to Rs.1,39,382/-.
As such the total amount alongwith interest of this Machine up to 20-6-2016 comes to Rs.3,89,382/-.
vii). JCB Machine:-
(a). This Machine is hired by the defendant vide work
Order No-271, dated 18-6-2013 at the monthly rate of Rs.80,000/- P.M. on the same terms and conditions. r Photo Copy of Work Order No-271 is attached herewith.
That vide this work order the machine worked as under:
Sr. No. Period Amount
1. 18-6-2013 to 30-6-2013 34,667/-
2. 1-7-2013 to 31-7-2013 80,000/-
3. 1-8-2013 to 31-8-2013 80,000/-
4. 1-9-2013 to 30-9-2013 80,000/-
5. 1-10-2013 to 31-10-2013 80,000/-
Total 3,54,667/-
Photocopy of Log Book is attached herewith.
That the total amount payable by the defendants to the plaintiff for the work done by this Machine for the above referred period comes to Rs.3,54,667/-.
That the amount of interest on this entire payment at the rate of Rs.10% P.A. up to 20-6-2016 from due date comes to `1,08,103/-.
As such the total amount alongwith interest of this Machine up to 20-6-2016 comes to `4,62,770/-.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 9As such the total amount recoverable from the defendants by plaintiff up to 20-6-2016 alongwith interest comes to Rs.1,29,08,955/-."
.
2. As per detail furnished herein above, an amount of `1,29,08,955/- is recoverable from the defendants by the plaintiff-Firm upto 20.6.2016 alongwith interest. Plaintiff-Firm has further averred that out of aforesaid amount, defendants had paid `5.00 lakh on 30.6.2013 and ` 1,04,637/- on 23.8.2013. Though, the defendants had assured plaintiffs to make the balance payment within shortest possible time but till date, no money was paid and as such, plaintiff-Firm was compelled to issue a legal notice dated 15.3.2016 calling upon the defendants to make the payment good within stipulated period, however, fact remains that the defendants failed to make payment good within the time as stipulated in the legal notice as such, plaintiff-Firm was compelled to initiate instant proceedings in this Court.
3. As per plaintiffs, cause of action accrued to them on different dates i.e. firstly on 7.7.2011, when defendants vide Work Order dated 11.8.2011 called upon the plaintiffs to start work on 7.7.2011 and to complete the same on or before 21.9.2011. Plaintiffs have also placed on record as many as six work orders to demonstrate that they were awarded work orders by defendants on different dates.
On 30.6.2013 and 23.8.2013, defendants made payments to the plaintiff to the extent of `5,00,000/- and `1,04,637/- through RTGS.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 10Lastly, plaintiffs sent a legal notice dated 15.3.2016 through registered post, calling upon the defendants to make the payment good. Plaintiffs .
have further averred in the plaint that defendants vide communication dated 23.8.2013, while making part payment have admitted the claim of the plaintiffs and as such, they are liable to pay the amount claimed in the present suit.
4. Since the defendants despite service failed to put in appearance, they came to be proceeded against ex parte vide order dated 23.5.2017. Subsequently, defendant No. 3 moved an application for setting aside ex parte order and vide order dated 19.9.2017, this Court allowed the application i.e. OMP No. 332 of 2017 having been filed by defendant No. 3 and recalled its order dated 23.5.2017 qua defendant No. 3. This Court vide order dated 19.9.2017 also permitted defendant No.3 to participate in the proceedings. Defendant No. 3 by way of OMP No. 346 of 2017 sought permission of this Court to defend the suit on behalf of defendant No. 3, however, fact remains that plaintiffs in their reply to the application categorically stated that they have no claim against defendant No.3 as such, this Court vide order dated 27.2.2018, ordered for deletion of name of defendant No.3 from the array of respondents.
5. As has been taken note herein above that defendant Nos. 1 and 2 despite service failed to put in appearance, instant suit having ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 11 been filed by plaintiffs under Order 37 CPC needs to be determined/ adjudicated on the basis of material adduced on record by the .
plaintiffs, being a summary suit.
6. Before ascertaining the correctness of the claim put forth by the plaintiffs, it would be apposite to make detailed reference to Order 37 CPC as under:
"ORDER XXXVII : SUMMARY PROCEDURE [***] [1. Court and classes of suits to which the Order is to apply (1) This Order shall apply to the following Courts, namely :-
(a) High Courts, City Civil Courts and Courts of Small Causes: and
(b) other Courts:
Provided that in respect of the Courts referred to in clause (b), the High Court may, by notification in the Official Gazette, restrict the operation of this Order only to such categories of suits as it deems proper, and may also, from time to time, as the circumstances of the case may require, by subsequent notification in the official Gazette, further restrict, enlarge 6r vary, the categories of suits to be brought under the operation of this Order as it deems proper.
(2) Subject to the provisions of sub-rule (1), the Order applies to the following classes of suits, namely:-
(a) suits upon bills of exchange, hundies and Promissory notes:
(b) suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising,-
(i) on a written contract, or
(ii) on an enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or
(iii) on a guarantee, Where the claim against the principal is in respect of a debt or liquidated demand only.] ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 12 7[2. Institution of summary suits (1) A suit, to which this Order applies, may if the plaintiff proceed desires to desires hereunder, be instituted by presenting a plaint which shall contain,-
.
(a) a specific averment to the effect that the suit is filed under this Order;
(b) that no relief, which does not fall within the ambit of this rule; has been claimed in the plaint; and
(c) the following inscription, immediately below the number of the suit in the title of the suit, namely :-
"(Under Order XXXVII of the Code of Civil Procedure, 1908)."
(2) The summons of the suit shall be in Form No. 4 in Appendix B or in such other Form as may, from time to time, be prescribed.
(3) The defendant shall not defend the suit referred to in sub-rule (1) unless he enters an appearance and in default of his entering an appearance the allegations in the plaint shall be deemed to be admitted and the plaintiff shall be entitled to a decree for any sum, not exceeding the sum mentioned in the summons, together with interest at the rate specified, if any, up to the date of the decree and such sum for costs as may be determined by the High Court from time to time by rules made in that behalf and such decree may be executed forthwith.] 8[3. Procedure for the appearance of defendant (1) In a suit to which this Order applies, the plaintiff shall, together with the summons under rule 2, serve on the defendant a copy of the plaint and annexures thereto and the defendant may, at any time within ten days of such service, enter an appearance either in person or by pleader and, in either case, he shall file in Court an a address for service of notices on him.
(2) Unless otherwise ordered, all summonses, notices and other judicial processes, required to be served on the defendant, shall be deemed to have been duly served on him if they are left at the address given by him for such service.
(3) On the day of entering the appearance, notice of such appearance shall be given by the defendant to the plaintiff's pleader, or, if tile plaintiff sues in person, to the plaintiff himself, either by. notice delivered at or sent by a pre-paid letter directed to the address of the plaintiff's pleader or of the plaintiff, as the case may be.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 13(4) if the defendant enters an appearance, the plaintiff shall thereafter serve on the defendant a summons for judgement in Form No. 4A in Appendix B or such other Form as may be prescribed from time to time, returnable not less than ten days from the date of service supported by an affidavit verifying the cause of action and the amount claimed and stating that in his .
belief there is no defence to the suit.
(5) The defendant may, at any time within ten days from the service of such summons for judgement, by affidavit or otherwise disclosing such facts as may be deemed sufficient to entitle him to defend, apply on such summons for leave to defend such suit, and leave to defend may be granted to him unconditionally or upon such terms as may appear to the Court or Judge to be just:
Provided that leave to defend shall not be refused unless the Court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial defence to raise or that the defence intended to be put up by the defendant is frivolous vexatious:
Provided further that, where a part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit shall not be granted unless the amount so admitted to be due is deposited by the defendant in Court.
(6) At the hearing of such summons for judgement,-
(a) if the defendant has not applied for leave to defend, or if such application has been made and is refused, the plaintiff shall be entitled to judgement forthwith; or
(b) if the defendant is permitted to defend as to the whole or any part of the claim, the Court or Judge may direct him to give such security and within such time as may be fixed by the Court or Judge and that, on failure to give such security within the time specified by the Court or Judge or to carry out such other directions as may have been given by the Court or Judge, the plaintiff shall be entitled to judgement forthwith.
(7) The Court or Judge may, for sufficient cause shown by the defendant, excuse the delay of the defendant in entering an appearance or in applying for leave to defend the suit.]
4. Power to set aside decree After decree the Court may, under special circumstances set aside the decree, and if necessary stay or set aside execution, and may give leave to the defendant to appear to the summons and to defend the suit, if it seems reasonable to the Court so to de, and on such terms as the Court thinks fit.
5. Power to order bill, etc., to be deposited with officer of Court ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 14 In any proceeding under this Order the Court may order the bill, hundi or note on which the suit is founded to be forthwith deposited with an officer of the Court, and may further order that all proceedings shall be stayed until the plaintiff gives security for the costs thereof.
.
6 Recovery of cost of noting non-acceptance of dishonoured bill or note The holder of every dishonoured bill of exchange or promissory note shall have the same remedies for the recovery of the expenses incurred in noting the same for non-acceptance or non-payment, or otherwise, by reason of such dishonour, as he has under this Order for the recovery of the amount of such bill or note.
(b) Procedure in suits Save as provided by this Order, the procedure in suits hereunder shall be the same as the procedure in suits instituted in the ordinary manner."
7. Rule (1) of Order 37 provides for summary procedure for suits which are based upon bills of exchange, Hundies and promissory notes or suits where plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising on a written contract, or on an enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or on a guarantee, where the claim against the principal is in respect of a debt or liquidated demand only. Similarly, Rule 2 of Order 37 relates to institution of summary suits and provides that plaintiff may make a specific averment that the suit has been filed under Order 37 and that no relief which does not fall within the scope and ambit of Order 37 has been claimed.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 158. Rule(3) further provides procedure for appearance of defendant. In the case at hand, plaintiffs have specifically mentioned in .
the head note of suit that it is a summary suit under Order 37 CPC for recovery of amount. Sub-rule (3) of Rule 2 specifically provides that in case defendant does not put in appearance, it shall be deemed that he has admitted the claim.
9. In the case at hand, admittedly defendants No.1 and 2 despite service, chose not to remain present in the court and as such, this Court before proceeding with the matter, needs to ascertain whether the claim put forth by plaintiffs in the instant suit could be sought by them by way of summary proceedings as envisaged under Order 37 or not?
10. Documents placed on record certainly suggest that defendant No. 1 issued work orders in favour of the plaintiffs for the works as detailed herein above, repeatedly. First work order came to be issued in favour of the plaintiffs vide communication dated 11.8.2011, whereby defendants placed work order for hire charge of the Excavator 110 for CPL at PHEP Stage-II Sainj. In terms of this order, plaintiffs were supposed to commence work on the site on or before 7.7.2011 and they had to complete the same on or before 21.9.2011. Similarly, documents filed alongwith suit reveal that as many as six work orders dated 8.9.2011, 30.11.2011, 29.2.2012 and ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 16 10.8.2012, 1.8.2013 and 31.1.2014 came to be issued in favour of the plaintiffs qua different works. Undisputedly, all the work orders .
referred to herein above contain general terms and conditions including rates qua the work required to be accomplished on the site by the plaintiffs in terms of work orders awarded in their favour by the defendants. Last work order came to be issued to the plaintiffs vide communication dated 18.6.2013, whereby defendant No.1 agreed to pay `80,000/- to the plaintiffs as hire charge of JCB and such work was to be completed within a period of four months from the date of start i.e. 18.6.2013.
11. It is abundantly clear from the perusal of aforesaid work orders placed on record by plaintiffs that defendants were required to pay certain amounts to the plaintiffs qua the works done by them on the site in terms of work orders referred to herein above. Confirmation of accounts issued by defendant No.1 dated 30.9.2015 further suggests that defendants made certain payments in terms of work orders placed by it to the plaintiffs, wherein defendant No.1 admittedly claimed that they owe an amount of `62,69,045/- to the plaintiffs on account of works done by them in terms of work orders referred to herein above.
Though, aforesaid amount has been disputed by the plaintiffs by stating that they are entitled to an amount of `85,83,780/- and not `62,69,045/-, but it is quite apparent from the documents available on ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 17 record, especially confirmation of accounts dated 30.9.2015 that plaintiffs have not only executed work on the site in terms of work .
orders placed to it, rather they have received part payment of `6,04,637/-.
12. Having perused work orders and confirmation of accounts issued by defendant No.1, this Court is convinced and satisfied that plaintiffs are within their right to institute summary suit under Order 37
13.
r to to recover debt/money payable by defendants, alongwith interest.
This court further finds from the pleadings as well as documents adduced on record by the plaintiffs that cause of action accrued to the plaintiffs firstly on 7.7.2011, when defendants placed work order for hire charge of Excavator Ex.-110 vide work order No.
07. Subsequent to aforesaid work order, defendants repeatedly issued work orders in favour of the plaintiffs specifically providing therein rate to which plaintiffs were held entitled. Lastly, as has been taken not above defendants vide communication dated 18.6.2013, again placed work order in favour of the plaintiffs and agreed to pay a sum of `80,000/- per month as hire charges of JCB. Subsequently, vide communication dated 30.9.2015, defendants not only acknowledged their liability to pay certain amounts in terms of work orders placed by ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 18 them on different dates, rather, also claimed that an amount of `6,04,637/- stands paid to the plaintiffs.
.
14. Having carefully perused documents referred herein above, this Court finds that summary suit having been filed by plaintiffs is well within limitation in terms of Article 18 of Schedule of Period of Limitation under Part I- suits relating to accounts and further Sections 18 and 19 of the Limitation Act. Ss. 18 and 19 of Limitation Act are reproduced hereunder:
"18. Effect of acknowledgment in writing.--
(1) Where, before the expiration of the prescribed period for a suit of application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
(2) Where the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received.
Explanation.--For the purposes of this section,--
(a) an acknowledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come or is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to set-off, or is addressed to a person other than a person entitled to the property or right;::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 19
(b) the word "signed" means signed either personally or by an agent duly authorized in this behalf; and © an application for the execution of a decree or order shall not be deemed to be an application in respect of .
any property or right.
19. Effect of payment on account of debt or of interest on legacy.--Where payment on account of a debt or of interest on a legacy is made before the expiration of the prescribed period by the person liable to pay the debt or legacy or by his agent duly authorized in this behalf, a fresh period of limitation shall be computed from the time when the payment was made:
Provided that, save in the case of payment of interest made before the 1st day of January, 1928, an acknowledgment of the payment appears in the handwriting of, or in a writing signed by, the person making the payment." Explanation.--For the purposes of this section,--
Explanation.--For the purposes of this section,--"
(a) where mortgaged land is in the possession of the mortgagee, the receipt of the rent or produce of such land shall be deemed to be a payment; (a) where mortgaged land is in the possession of the mortgagee, the receipt of the rent or produce of such land shall be deemed to be a payment;"
(b) "debt" does not include money payable under a decree or order of a court. (b) "debt" does not include money payable under a decree or order of a court."
15. Bare perusal of aforesaid provisions of law suggests that suit, if any, for recovery of debt/money can be filed by plaintiff within a period of three years from the date of part payment and/or from the date of acknowledgement, if the same is made by the person liable to pay the debt before expiration of the prescribed period.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 2016. In the case at hand, admittedly, defendants in the confirmation of accounts dated 30.9.2015, have not only admitted .
liability to the extent of 62,69,045/- but have also admitted that they have made part payment of `6,04,637/- and as such, if period of limitation is counted from the date of aforesaid confirmation of accounts, suit having been filed by plaintiffs definitely is well within limitation as prescribed under Article 18 of The Schedule "Period of reproduced hereunder:
r to Limitation" Part I-Suits relating to accounts of Limitation Act, which is "Description of suit Period of limitation Time from which period begins to run .
18. For the price of work done by the plaintiff for the defendant at his request, where no time has been fixed for payment . Three years When the work is done"
17. In view of discussion made herein above, this Court finds that instant suit filed under Order 37 is maintainable and plaintiffs are well within their right to recover amount as claimed in the suit. Since, defendants No. 1 and 2 despite service failed to put in appearance, sub-
rule (3) of Rule-2 of Order 37 shall come into play and it would be deemed that the defendants No.1 and 2 have admitted the claim of the plaintiffs as put forth in the plaint. In this regard, reliance is placed upon judgment of Hon'ble Apex Court in Ramkarandas v.::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 21
Bhagwandas, AIR 1965 SC 1144, relevant paragraph whereof is reproduced as under:
.
"10. On the merits too, we think that the contention is fallacious. It proceeds on the basis that when leave to defend has been refused to a defendant, the Court is bound to pass a decree. It seems to us that what sub-r. (2) of r. 2 of Or. 37 contemplates is that the Court will accept the statements in the plaint as correct and on those statements pass such decree as the plaintiff may in law be entitled to. If, for example, the plaint discloses no cause of action, the Court cannot pass any decree in favour of the plaintiff. If this were not so, the words "allegations in the plaint shall be deemed to be admitted" in sub-r. (2) of r. 2 of Or. 37 would have been unnecessary. The Court in making a decree under sub-r. (2), r. 2 of Or. 37 has to keep the law in mind. If the law requires the Court to exercise a discretion on the facts deemed to be admitted, it will have to do so."
18. Hon'ble Apex Court in Ajay Bansal v. Anup Mehta, AIR 2007 SC 909, has held as under:
"2. This appeal is directed against a judgment and order dated 30.01.2006 passed by a learned Single Judge of the High Court of Delhi whereby and whereunder an application filed under Article 227 of the Constitution of India filed by the respondents herein against a judgment and order dated 27.05.2005 passed by a learned Civil Judge, Karkardooma, Delhi was allowed.
3. Appellant herein filed a suit which was marked as Suit No. 303 of 2004 for recovery of a sum of Rs. 2,93,987/- with interest on account of dishonoured cheques. The said suit was filed in terms of Order XXXVII of the Code of Civil Procedure (Code). The respondents filed an application purported to be under Order XXXVII, Rule 3 (5) of the Code praying for grant of leave to defend the said suit. The learned Civil Judge refused to do so by an order dated 27.05.2005 opining:
"I am convinced with the plaintiff's contention that the defence as disclosed by defendant in their application is sham and illusory and in my considered opinion, the defendants are not entitled for leave to defend the present suit and the plaintiff is ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 22 entitled to have the judgment signed. Accordingly, the application under Order 37, Rule 3(5) CPC of the defendants is devoid of any merits. The same is hereby dismissed. Application is disposed of accordingly."
.
4. On the said date itself, a final judgment and decree was passed for a sum of Rs. 2,83,987/- with interest at the rate of 12% thereon holding:
"4. It is contemplated under Order 37, Rule 3(5) CPC that if any application for leave to defend the suit has been made by the defendant and is refused, the plaintiff shall be entitled to judgment everywhere. Since the application under Order 37, Rule 3(5) CPC of the defendants has been dismissed as the defendants failed to raise any triable issue or disclose any defence in their application, in my considered opinion, the plaintiff has become entitled to have the judgment signed. Accordingly, suit of the plaintiff is hereby decreed with cost plaintiff is entitled for a decree to recover a sum of Rs.
2,83,987/- from the defendants. However, since the plaintiff has failed to establish his claim of interest @ 18% per annum which he has claimed is the market rate for commercial transaction, I am inclined to award the interst at the prevailing rate only which is @ 12% per annum on the decretal amount from the date of institution of the present suit till realization. Decree sheet be prepared "
5. An application filed thereagainst by the respondents has been allowed by the impugned judgment. The appellant is, thus, before us.
6. The short contention raised by Mr. Jitender Sharma, learned senior counsel appearing on behalf of the appellant, is that keeping in view of the fact that an appeal was maintainable under Section 96 of the Code against the judgment and decree passed by the learned Civil Judge, the application under Article 227 of the Constitution of India was not maintainable.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 237. The contention of Mr. V.L. Madan, learned counsel appearing on behalf of the respondents, on the other hand, is that the writ petition was maintainable as the respondents could not have been put to undue hardship of depositing the entire decretal amount in terms of .
Order XLI Rule 1 of the Code of Civil Procedure although it had made out a good case for obtaining leave to defend the suit. Order XXXVII, Rule 3(5) of the Code reads, thus:
"(5) The defendant may, at any time within ten days from the service of such summons for judgment, by affidavit or otherwise disclosing such facts as may be deemed sufficient to entitle him to defend, apply on such summons for leave to defend such suit, and leave to defend may be granted to him unconditionally or upon such terms as may appear to the Court or Judge to be just :
Provided that leave to defend shall not be refused unless the Court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial defence to raise or that the defence intended to be put up by the defendant is frivolous or vexatious :
Provided further that, where a part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit shall not be granted unless the amount so admitted to be due is deposited by the defendant in Court."
9. A "decree" is defined under Section 2 (2) of the Code to mean:
""decree" means the formal expression of an adjudication which, so far as regards the Court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final. It shall be deemed to include the rejection of a plaint and the determination of any question within section 144, but shall not include
(a) any adjudication from which an appeal lies as an appeal from an order, or
(b) any order of dismissal for default."::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 24
10. A "judgment" is defined under Section 2(9) of the Code to mean "the statement given by the Judge on the grounds of a decree or order".
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11. An order refusing to grant leave is a judgment within the meaning of Letters Patent of the Chartered High Courts. [See Shah Babulal Khimji v. Jayaben D. Kania and Another, (1981) 4 SCC 8]
12. A decree passed in a summary suit where leave to defend the suit has been refused is almost automatic. The consequence of passing a decree cannot be avoided.
13. Ordinarily, an application under Article 227 of the Constitution of India would not be maintainable where an appeal lies. An appeal lay from the decree under Section 96 of the Code. When an appeal could be filed, ordinarily, an application under Article 227 of the Constitution of India would not be entertained.
14. A decree passed subsequent to the refusal of leave to defend could either be under Order XXXVII Rule 3(6) of the Code or it could be based on the affidavit evidence on the side of the plaintiff and the documents produced or even based on oral evidence formally proving, say, the execution of a promissory note by the defendant. It may not be proper or necessary to apply the theory of "dependent order" in such circumstances. For one, the theory may not apply. Even if this Court were to set aside the order of the court below and give the defendant leave to defend the suit, the decree that is passed may not go automatically. It may have to be set aside. Secondly, the defendant can always go to the court which passed the decree and move under Rule 4 of Order XXXVII of the Code to reopen the decree.
The theory of "dependant order" may not apply in a case of this nature because even if this Court were to set aside the order refusing leave to defend, the decree subsequently passed may not fall by itself. It has still to be set aside either by resort to Order XXXVII Rule 4 or by way of an appeal, or by some other mode known to law. In a given case like the present one as it may not be proper to interfere with the decree merely because in an appeal against an order refusing leave to ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 25 defend, this Court is inclined to take a different view. [See V.S. Saini & Anr. v. D.C.M. Ltd., AIR 2004 Delhi219.]
19. Reliance is also placed upon judgment rendered by Delhi .
High Court in Vijaya Home Loans Ltd. v. M/s. Crown Traders Ltd., AIR 1998 Delhi 183, wherein it has been held as under:
"(3) Defendants were served with the summons under Order xxxvii, Civil Procedure Code by publication in 'Statesman' on November 30, 1996.
(4) Since the defendants did not enter appearance within 10 days of the service of the summons on them, the plaintiff filed Ia No. 12534/96 on December 12,1996, under Order xxxvii Rule 2(3) read with Section 151, Civil Procedure Code for passing a decree for the suit amount alongwith interest against the defendants.
(5) SUB-RULE (3) of Rule 2 of Order xxxvii, Cpc, which is relevant, provides as under:
"DEFENDANT shall not defend the suit referred to in Sub-rule (1) unless he enters an appearance and in default of his entering an appearance the allegations in the plaint shall be deemed to be admitted and the plaintiff shall be entitled to a decree for any sum, not exceeding the sum mentioned in the summons, together with interest at the rate specified, if any, upto the date of the decree and such sum for costs as may be determined by the High Court from time to time by Rules made in that behalf and such decree may be executed forthwith."
(6) As the defendants failed to enter appearance within 10 days of the service of the summons by publication the allegations made in the plaint shall be deemed to be admitted by them under said Sub-rule (3) of Rule 2 of Order xxxvii, CPC. Plaintiff-Company is, thus, entitled to a decree for the suit amount with interest pendente lite and future @ 22% p.a. being the contractual rate against the defendants.
::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 26(7) Consequently, suit is decreed for recovery of Rs. 49,35,184.00 with interest pendente lite and future till realisation @ 22% per annum on Rs. 32,56,630.00 and the costs against the defendants."
.
20. While applying ratio of aforesaid exposition of law, suit of the plaintiffs needs to be decreed in the absence of defendants No.1 and 2, as they failed to put in appearance in this Court despite service.
Needless to say, this Court before decreeing the suit of the plaintiffs, needs to satisfy itself that the suit filed by the plaintiffs is well within limitation and plaint discloses cause of action in favour of the plaintiffs. In the case at hand, as has been discussed herein above, suit filed by the plaintiffs is well within limitation and plaintiffs have sufficient cause of action to institute the suit against defendants No.1 and 2. At the cost of repetition, it may be noticed that though defendants No.1 and 2 in the confirmation of accounts dated 30.9.2015, have categorically admitted the claim of the plaintiffs to the extent of `62,69,045/- but there is no reply, if any, to the legal notice issued by the plaintiffs, wherein plaintiffs have claimed that defendants owe an amount of ` 85,83,780/- to them on account of works executed on the site pursuant such work orders and, as such, plaintiffs are entitled to the amount as claimed by them in the instant suit.
21. Since plaintiffs, have failed to establish their claim to interest at the rate of 10% per annum, this Court deems it fit to award interest at the prevalent rate of interest and as such, plaintiffs are held ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP 27 entitled to interest at the rate of 7.5% per annum, on the decreetal amount, from the date of institution of suit till its realization.
.
22. Accordingly, suit of the plaintiffs is hereby decreed.
Plaintiffs are held entitled to recover an amount of `85,83,780/-
alongwith interest at the rate of 7.5% per annum on the decreetal amount from the date of institution of suit till realization, from defendants No. 1 and 2. No orders as to costs of the suit.
Decree sheet be prepared accordingly.
(Sandeep Sharma) Judge April 3, 2018 vikrant ::: Downloaded on - 06/04/2018 22:53:02 :::HCHP