Bangalore District Court
Omron Automation Pvt. Ltd vs Mars Electronics on 6 August, 2016
IN THE COURT OF THE 42nd ADDL. CITY CIVIL & SESSIONS
JUDGE AT BENGALURU CITY (CCH.NO.43).
PRESENT:Sri.Bailur Shankar Rama,
B.Sc., M.A., LL.B.(Spl).,
42nd Addl. City Civil & Sessions Judge,
Bengaluru.
Dated this the 6th day of August 2016.
O.S.No.4909/2015
Plaintiff: Omron Automation Pvt. Ltd.
A Company incorporate under the
Companies Act, 1956,
Having its Registered Office
At Unit 108 & 103-106, 1st Floor,
Sewa Corporate Park,
M.G.Road, Gurgaon,
Haryana - 122 002.
And having its Regional Office
At No.43, G.N.Complex,
St.Johns Road,
Bangalore-560 042,
Represented herein by
Mr.Rajiv Datta, Major,
Senior Manager -
Resource Mangement.
(Sri.Pradeep Nayak, Adv.)
v.
Defendant:- Mars Electronics,
743, 6th Main Road,
Srinagar, BSK 1st Stage,
Bangalore-560 050.
(Exparte)
2 O.S.No.4909/2015
Date of institution of the suit : 06.06.2015
Nature of the suit : Recovery of money
Date of commencement of : -
recording of the evidence
Date on which the judgement : 06.08.2016
was pronounced
Total Duration Years Months Days
01 02 00
(BAILUR SHANKAR RAMA)
42nd ADDL. CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
JUDGMENT
This is a suit filed by the plaintiff against the defendant for the recovery of Rs.26,49,971.78 along with future interest.
2. The brief facts as averred in the plaint are that:-
The plaintiff filed this suit under Order 37 of CPC. The plaintiff Company is involved in manufacture and production of Industrial Automation Products and has been enjoying a Global as well as pan-Indian reputation as a Market Leader. The defendant is distributor of Industrial Automation 3 O.S.No.4909/2015 Products. The defendant approached the plaintiff with a view to secure a Channel Partner Contract in its favour. Channel Partner Contract is a Distributorship Agreement was duly executed on 06.11.2012, which mandates that the defendant is liable to make all payments within 45 days form the date of invoice for despatches made from Bangalore Warehouse. It also mandates that in the event of delayed payments by the defendant, they are liable to pay interest at the rate of 18% p.a. on all overdue payments from the date on which they became due till the date of eventual realization. Thus, the defendant is due to pay Rs.26,49,971.78. That is the reason, the plaintiff got issued notice. In a letter dated 15.07.2013 Sri.B.R.Kumar, CEO of Defendant Company, has admitted that there is payment due from them and assured of releasing the payment within 4-6 weeks. E-mail communications between plaintiff and defendant reveal that no improvement is seen as the defendant failed to make payments. With a view to settle the amount due to the plaintiff, the defendant had issued cheque bearing No.889895 dated 14.06.2013 for Rs.9,99,874/- drawn on SBI. When it was presented to 4 O.S.No.4909/2015 ICICI Bank Ltd, Lalbagh Road, for realization, which was dishonoured with an endorsement 'Funds Insufficient'. Even plaintiff proposed One Time Settlement of Rs.10,00,000/- towards the full and final settlement of total outstanding of Rs.17,06,752.84. Because of consisting failure of the defendant in discharging the debt, the plaintiff was constrained to file the instant suit.
3. Even after step of publication is taken against the defendant, the defendant remained absent, as such placed exparte.
4. In view of the fact that summary suit is filed under Order 37 of CPC, the defendant remained exparte. In the absence of the presence of the defendant certainly under Order 37 Rules 2 & 3 the plaintiff is entitled to judgment based on the pleading and available documents filed in support of the plaint and recording of evidence is dispensed with. The learned counsel for the plaintiff has relied on decisions:-
5 O.S.No.4909/2015
1. 2013(5) AWC 4589 (SC)), in the case of TVC Sky Shop Ltd. v Reliance Communication and Infra Ltd.
2. 2010 (1) KLJ 355, in the case of Valappil Azeez v Moidu.
3. AIR 1998 Del 183, in the case of Vijaya Home Loans Ltd. v. M/s. Crown Traders Ltd. and another.
4. 2005 (80) DRJ 513, in the case of Emmsons International Ltd. v. Harshvardhan Chemicals & Minerals Ltd.
By following the principles laid down in the above cited decisions in a summary suit the matter is taken up straight away for judgment.
5. Heard the arguments of the learned counsel for the plaintiff.
6. The points that arise for my consideration are that:-
1. Whether the plaintiff proves that the defendant is liable to pay Rs.26,49,971.78 along with interest at the rate of 18% p.a. as prayed?
2. Whether the plaintiff further proves that the defendant is liable to pay 18% p.a. interest 6 O.S.No.4909/2015 pendentelite and future interest till realization?
3. What Order?
7. My answers to the above points are as follows:-
Point No.1:- In the affirmative.
Point No.2:- In the affirmative.
Point No.3:- As per final order,
for the following:-
REASONS
8. POINT NO.1:-
The pleaded case of the plaintiff is that, Plaintiff Company is involved in manufacture and production of industrial automation products and has been enjoying global as well as Pan Indian Reputation as Market Leader. True copy of Board of Resolution authorizing Sri.Rajiv Datta to institute the suit is also produced. It is case of the plaintiff that defendant is distributor of industrial automation products and had approached the plaintiff with a view to secure Channel Partner Contract in its favour and Distributorship Agreement was executed. The Channel Partner Commercial Terms and Conditions for the year 2012-13 was entered into on 06.11.2012 between the 7 O.S.No.4909/2015 plaintiff and the defendant. The document is available on record. The original document reveals the terms and conditions of the contract between the two. On reading Clause 10(1) of the Agreement, which clearly mandates that the defendant is liable to make all payments within 45 days from the date of invoice for despatches made from Bangalore Warehouse and as rightly argued by the learned counsel for the plaintiff that Clause 12 stipulates penalty charges on delayed payments, which clearly goes to show that Channel Partner shall liable to pay penalty to the plaintiff Company on such sum from the due date of payment at 18% p.a. on all overdue payments. Even in case of late payment, the right is vested with the plaintiff Company to cancel, suspend or terminate or all part of the order till the full payment along with penalty is recovered. Therefore, it is clear that the defendant has agreed to pay interest at the rate of 18% on delayed payments made. Original Invoice Sheet is produced to evidence that materials were supplied, but the defendant has failed to make payment on the invoices as per the Clause 10(1) within 45 days from the date of invoice for despatch. 8 O.S.No.4909/2015 Therefore, it is clear that the goods were duly supplied to the defendant under the invoices, but no payments were made as agreed within the stipulated time under the contract. Therefore, the defendant is liable to pay interest at 18% p.a. on such dues from the date of invoices. Accordingly, calculated that the defendant was liable to pay interest of Rs.9,43,218/- on outstanding dues under the invoices. It is clear from the documentary evidence on record the plaintiff has made a claim of such amount, a cheque was issued by the defendant through his authorized signatory drawn on State Bank of India dated 14.06.2013 for Rs.9,99,874/-. But when the cheque was presented by the plaintiff to its Banker i.e. ICICI Bank, Lalabagh Road, for realization, it was returned with an endorsement 'funds insufficient' in the account of the defendant. May be, it is a cause of action for them to initiate criminal action basing on the cheque issued bounced. But it is an evidence to show that the defendant admitting his liability has issued the said cheque, but that was not realized.
9 O.S.No.4909/2015
E-mail correspondences produced also goes to show that the plaintiff has made repeated requests and demands from the defendant asking them to pay outstanding dues and interest chargeable as per the terms and conditions of Clause 10(1) and 12 of the Agreement. The assurance given by the defendant of making repayment was not adhered to. Even one time settlement proposal was given for Rs.10,00,000/- towards full and final settlement of total outstanding of Rs.17,06,752.84 as could be seen from E- mail. But that was also not availed by the defendant. These E-mails goes to show that the defendant firm through its Company CEO has admitted and acknowledged their liability to pay that much amount to the plaintiff was due under the invoices relied. Finally the plaintiff was cnsd to issue legal notice dated 11.11.2014 demanding outstanding amount owe to it as could be seen from the office copy of the notice available in the file produced along with the plaint. Therefore, certainly, as rightly argued by the learned counsel for the plaintiff that under Section 65(b) of Indian Evidence Act, 1872 the E-mail correspondence between the plaintiff and the defendant with regard to the 10 O.S.No.4909/2015 suit claim is concerned, can be considered as an evidence of fact. Therefore, it is needless to say that the defendant remained exparte were aware of the fact that bouncing of cheque given by the CEO of defendant Company in discharge of the dues under the invoices relied by the plaintiff and there is an acknowledgement of their liability could be gathered from the e-mail correspondences. Knowing fully well that they are governed by the terms of the contract, they are liable to pay interest at the rate of 18% p.a. on the outstanding dues from the date of respective invoices due and accordingly, the plaintiff has charged and calculated interest as per the summary calculated in the plaint itself in tabular format. Therefore, it is held that the plaintiff has proved that the defendant is liable to pay Rs.17,06,752.84, interest accrued on the said amount Rs.9,43,218.94, together Rs.26,49,971.78. Accordingly, answer Point No.1 in the affirmative.
In this case, the plaintiff Company has claimed interest pendentelite and future interest on the suit claim at the rate of 18% p.a. since the claim made by the plaintiff against the defendant arising out of the contract which 11 O.S.No.4909/2015 stipulates payment of interest in case of delayed payments. The transaction between them is commercial transaction. Even though claim of the future interest is not governed by the contract of the parties, but it is the discretion of the court under Section 34 of CPC. But in this case the pleadings and documents goes to show that opportunities given by the plaintiff to the defendant Company to make payment including one time settlement proposal which was acknowledged by the plaintiff, but they did not avail such benefits. As such, plaintiff Company was constrained to file the instant suit. Since this being a commercial transaction, there was no response by the defendant Firm, even publication was issued, they failed to contest the suit. As such, this court is of the considered view that it is not a fit case to exercise the discretion of the court in lowering the rate of interest payable while awarding future interest is concerned. The plaintiff Company is entitled to recover the decree amount pendentelite and future interest till realization at the contractual rate itself i.e. 18% p.a. from the date of suit till its realization. Accordingly, I answer Point No.2 in the affirmative.
12 O.S.No.4909/2015
12. Point No.2:- For the forgoing reasons, I proceed to pass the following:-
ORDER Suit filed by the plaintiff against the defendant is hereby decreed with costs.
The defendant is liable to pay to the plaintiff the principal sum of Rs.17,06,752.84 and interest accrued as per the terms of the contract calculated Rs.9,43,218.94 together Rs.26,49,971.78 along with future interest at the rate of 18% p.a. from the date of suit till the date of decree and from the date of decree till realization.
Draw decree accordingly.
(Dictated to the Judgment Writer on computer, typed by her, the transcript corrected and then pronounced by me, in open Court, this the 6th day of August 2016).
(BAILUR SHANKAR RAMA) ND 42 ADDL. CITY CIVIL & SESSIONS JUDGE, BANGALORE.
ANNEXURE I. List of witnesses examined on behalf of:
(a) Plaintiff's side: Nil.13 O.S.No.4909/2015
(b) Defendants' side: Nil II. List of documents exhibited on behalf of:
(a) Plaintiff's side: Nil.
(b) Defendants' side: Nil.
42nd ADDL. CITY CIVIL & SESSIONS JUDGE, BENGALURU.
14 O.S.No.4909/2015(Judgment pronounced in open court and order portion of the same is extracted as under) ORDER Suit filed by the plaintiff against the defendant is hereby decreed with costs.
The defendant is liable to pay to the plaintiff the principal sum of Rs.17,06,752.84 and interest accrued as per the terms of the contract calculated Rs.9,43,218.94 together Rs.26,49,971.78 along with future interest at the rate of 18% p.a. from the date of suit till the date of decree and from the date of decree till realization.
Draw decree accordingly.
(BAILUR SHANKAR RAMA) 42nd A.C.C. & S.J., Bengaluru City.