Delhi District Court
Cross Section Interactive Pvt. Ltd vs Mmr Saha Infrastructure Pvt. Ltd on 24 December, 2019
IN THE COURT OF DR. PANKAJ SHARMA, ADDITIONAL SENIOR CIVIL
JUDGE, NEW DELHI DISTRICT, PATIALA HOUSE COURT.
Civil Suit No:-58741/16
Cross Section Interactive Pvt. Ltd.
Through Authorized Representative
Registered office at:
401, Surya Kiran Building,
19, Kasturba Gandhi Marg,
New Delhi-110001 .............Plaintiff
Vs.
MMR Saha Infrastructure Pvt. Ltd.
Through the Director
at:-
a. 309, Harsha Corner Complex,
DDA Local Shopping Centre,
Gazipur, Delhi-110096.
b. A-14, Ring Road,
Lajpat Nagar-IV,
New Delhi-110024.
c. MMR House,
B-11, Sector-57,
Noida,
District: Gautam Budh Nagar-201307.
d. A-10, B-1, Third Floor, Mohan Co-operative Industrial Estate Ltd.
Badarpur Delhi- South Delhi
Delhi-110044. ............Defendant
Date of Institution : 01.09.2016
Date of reserving order : 23.12.2019
Date of Judgment : 24.12.2019
JUDGMENT:
1. This is a suit for recovery of Rs.2,39,400/- alongwith pendente lite and future interest @ 18% p.a from the date of filing of suit till its actual CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 1 of 13 realization with costs of the suit.
2. The case of the plaintiff is that plaintiff Company is India's leading Website Development Agency that has till date successfully created 450 live sites and 1200 plus websites that are designed for a range of Industries. In addition to the above, the plaintiff company provide various services like social media Optimization, search Engine Optimization and Online Reputation Management and all other ancillary services relating to websites, to its Customers. The plaintiff company has a team of multi- talented individuals who work tirelessly in order to harness the power of the Internet to the best of their customer's advantage. The present suit is being filed and signed by Sh. Sunil Singh, Authorized Representative who is duly appointed vide Board Resolution dated 02.08.2016.
3. It is averred that the defendant company is a company incorporated and registered under the provisions of Companies Act, 1956, having its registered office at the address mentioned in the plaint. The defendant company is engaged in the business of Real Estate Development. It is averred that the defendant company is being managed by Sh. Mahipal Singh Raghav, Sh. Mohit Singh Raghav, Sh. Rahul Raghav and are in charge of the day to day affairs and management of the said company. It is averred that the defendant company approached the plaintiff company for seeking its services being offered by the plaintiff and requested to provide them detailed representations in relation to the services. Thereafter, the plaintiff company and the defendant company admittedly entered into an Agreement dated 01.04.2014 and as per the said agreement, the defendant company appointed the plaintiff company as a vendor with effect from 01.06.2015 till 30.04.2016. It is averred that as per the said agreement, the defendant company selected two services being offered by the plaintiff company namely, Search Engine Optimization and Social CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 2 of 13 Media Optimization. As per the admitted and agreed terms the services for Search Engine Optimization was to be provided for a monthly fee of Rs.45,000/- and the fees finalized for Social Media Optimization was fixed for monthly retainership of Rs.70,000/-. The agreement entered between the parties also enshrined in it the Scope of work to be done by the plaintiff; the same is also admitted by the defendant company. It is averred that as per agreed terms monthly payment had to paid in advance of every month and the rates were valid for a period of one year, from the effective date of the agreement. It is averred that the plaintiff company provided its services to the defendant company strictly as per the terms agreed between the parties and as per that invoices were raised on the defendant company. The following invoices were raised by the plaintiff upon defendant company:-
Invoice No. Date Amount (Rs.)
CSI/SEO/15/06/14 15.06.2015 Rs.79,800.00
CSI/SEO/15/07/24 15.07.2015 Rs.79,800.00
CSI/SEO/15/08/36 17.08.215 Rs.79,800.00
4. It is averred that since then the plaintiff company has been regularly following up the defendant company for the release of legally payable dues to them and the defendant company at the same time have taken several opportunities to make the said payment and made several promises, but to the dismay of the plaintiff company, all the said promises and assurances have fallen flat and the defendant company have completely defaulted in making the said payments. It is averred that defendant company vide email dated 18.08.2015, abruptly asked the plaintiff company to pause/hold the campaign till next instructions from their end. It is averred that the plaintiff company stopped raising invoices pursuant to the aforementioned email from the defendant company. The CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 3 of 13 agreement entered between the parties clearly envisages the provisions relating to the suspension and cancellation of the services, as per Clause
(e) where work on the project has been suspended, postponed or terminated on the instructions of the defendant company then all the fees due and payable to the plaintiff company till that date has to be paid to the plaintiff company. It is averred that as per Ledger Accounts maintained by the plaintiff company, there is an outstanding of Principle amount of Rs.2,39,400/-. Due to non-payment of legally payable dues by the defendant company, the plaintiff company was forced to issue the defendant company a legal notice dated 03.02.2016. In reply to the concocted contentions of the defendant company, the plaintiff company was constrained to issue again a legal notice dated 21.06.2016 but all in vain. Hence, the present suit.
5. In the WS, the defendant stated that the suit filed by the plaintiff is not maintainable and plaintiff suppressed material facts from the court. Also it is stated that plaintiff has violated the terms and conditions of the contract dated 01.04.2014 as the said contract was created to have Search Engine Optimization and Social Media Optimization only and was not for Website Development. The averments made in the plaint are denied by the plaintiff and sought dismissal of this suit.
6. Replication to the written statement was filed on behalf of the plaintiff. In replication, contents of the plaint are reiterated and contentions of the defendant in the written statement have been denied.
7. On the basis of pleadings of the parties, the following issues were framed on 04.05.2018:-
Issue no.1:- Whether this court does not have territorial jurisdiction to entertain the present suit as no cause of action had arisen within the territorial jurisdiction of this Court? OPD. Issue no. 2:- Whether the plaintiff is not entitled to any relief for its CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 4 of 13 failure to provide services in terms of the contract? OPD. Issue no. 3:- Whether the plaintiff is entitled to recover a sum of Rs.2,39,400/- from the defendant? If yes, whether the plaintiff is entitled to any interest and at what rate? OPD.
Relief.
8. In order to substantiate its case, the plaintiff has only examined one witness Sh. Sunil Singh Chauhan as PW1. He has tendered his affidavit in his evidence and the same is Ex.PW1/A. In his affidavit, 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 the following documents:-
1) Incorporation certificate Ex.PW1/1 (OSR);
2) Original Board Resolution dated 02.08.2016 Ex.PW1/2;
3) Original agreement dated 01.04.2014 Ex.PW1/3;
4) Email dated 13.08.2015 Ex.PW1/4;
5) Email dated 14.08.2015 Ex.PW1/5;
6) Email dated 18.08.2015 Ex.PW1/6;
7) Invoice dated 15.06.2015 Ex.PW1/7;
8) Invoice dated 15.07.2015 Ex.PW1/8/;
9) Invoice dated 17.08.2015 Ex.PW1/9;
10) Email dated 18.08.2015 from defendant company Ex.PW1/10;
11) Leisure a/c from 01.04.2015 to 12.01.2016 Ex.PW1/11;
12) Office copy of legal notice dated 03.02.2016 Ex.PW1/12;
13) Reply dated 22.03.2016 Ex.PW1/13;
14) Office copy of legal notice dated 21.06.2016 Ex.PW1/14;
15) Original postal receipts Ex.PW1/15 (Colly);
16) Tracking reports Ex.PW1/16 (Colly) and
17) Certificate under Section 65-B of Indian Evidence Act, 1872 Ex.PW1/17.CS No.58741/16
Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 5 of 13
9. In his cross examination, PW1 has deposed that he is working with the defendant as an Admin Executive. His work profile is managing admin work of the office such as, house keeping, security, maintenance, bank and outside field work. He stated that the plaintiff company is engaged in the business website development, such as, online reputation, search engine and social media optimization. Social media optimization is an additional service which they provide to their clients for whom they develop their website for propagating the same on the social media. The agreement in question was executed on 01.04.2015 and the services there under were supposed to be provided on and from 01.06.2015. The agreement was entered into for provision of two services i.e. search engine optimization and social media optimization. The present dispute is with respect to money owed by the defendant for provision of social media optimization services. There is no document placed on record or exhibited which shows/demonstrate or proves that the plaintiff company has rendered the services for which money is being claimed from the defendant. He stated that he does not know what kind or nature of services were to be provided to the plaintiff company to the defendant in terms of the agreement referred above. As per the payment mechanism, the defendant was supposed to make payment in advance and subsequently, the invoice was to be raised by the plaintiff company. No payment was received, however, the invoice Ex. PW-1/7 was raised irrespective on 15.06.2015. There is no e-mail or any communication by the plaintiff company seeking money in terms of the agreement Ex. PW- 1/3. He further stated that he does not have any knowledge as to whether the plaintiff company has ever performed its obligations in terms of the agreement Ex. PW-1/3 and there is no document on record to show/prove the same. The next invoice dated 15.07.2015 was raised in terms of the agreement Ex. PW-1/3. There is no document or evidence CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 6 of 13 on record to demonstrate/prove that the plaintiff company provided any services to the defendant as against which the invoices Ex. PW-1/7 to Ex. PW-1/9 were raised. The legal notice Ex. PW-1/12 was issued on the instructions of the plaintiff company. The facts contained in the legal notice Ex. PW-1/12 were narrated/informed by the plaintiff company to the said counsel. There is no document or communication placed on record by the plaintiff company demanding any money from the defendant in the time span falling between the date on which the invoice Ex. PW-1/9 and the legal notice Ex. PW-1/12. The legal notice Ex. PW- 1/12 was responded by the defendant vide reply dated 22.03.2016 Ex. PW-1/13. On 21.06.2016, the plaintiff company again issued the legal notice Ex. PW-1/14 to the defendant. The facts contained in the said legal notice Ex. PW-1/14 were also narrated and informed to the counsel by himself on the instructions of the Mr. Naresh Rawat, who is Accounts Manager. He denied the suggestion that the ledger is fraudulently created to rest this recovery suit. In terms of the agreement, it was a manifest obligation on the plaintiff company that the money agreed to be paid by the defendant will only be deemed to be payable when service as against the said payment is provided. However, there is no document placed on record by the plaintiff company to prove that it has rendered services to the defendant in terms of the agreement Ex. PW-1/3. The affidavit cum evidence Ex. PW-1/A was drafted by his counsel and signed by him. After signing the said affidavit, he immediately went back to his office. His signatures are put on point A and B on Ex. PW-1/A. He denied the suggestion that he simply put his signatures on the Ex. PW- 1/A without reading the same. He stated that he does not know as to whether the Ex. PW-1/A was attested. He denied the suggestion that the affidavit Ex. PW-1/A is wrong or narrates false/cooked up story. He further denied the suggestion that the plaintiff company did not provide CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 7 of 13 any services to the defendant. He denied the suggestion that the defendant company stopped them from working because they never performed their obligation in terms of agreement Ex. PW-1/3.
Thereafter, PE was closed and the matter was listed for DE.
10. In order to prove its defence, defendant has examined only one witness i.e. Sh. Rahul Raghav as DW1. DW1 has tendered his affidavit in his evidence and the same is Ex.DW1/A. He has relied upon document i.e. Board Resolution dated 21.03.2017 which is Ex.DW1/1 (OSR).
11. In his cross-examination, DW1 has deposed that he has been working with the defendant company since 2015 as a Director of the company. His team was dealing with the plaintiff company. As per his knowledge, an agreement was entered between the parties but he was not aware about the date of the said agreement. He admitted that he was not part of the negotiations. Mr. Bharat Aggarwal and Mr. Gaurav Arora were in the marketing team but he does not remember if they dealt with the plaintiff company. He stated that these two representative of their company were dealing with the plaintiff company. The plaintiff company was supposed to provide Search Engine Optimization (SEO) and Social Media Optimization Services (SMO) for the defendant group. For the SEO, the fees payable was Rs.40,000/- per month plus taxes and and for SMO, the fees payable approximately Rs.70,000/- per month plus taxes. Again said, please refer to the agreement for the exact amount. He stated that he does not know what was the duration of the agreement entered between the parties. Witness was shown Ex.PW1/3 i.e. Agreement dated 01.04.2014 and he admitted that the statement made made by him was based on the said document. He stated that he cannot say whether any payment was made by the defendant company to the plaintiff company for the services under this agreement. The company had raised certain objections regarding these services provided by the CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 8 of 13 plaintiff company but he cannot say as to when the said objections were raised. The defendant company had raised objections vide two e-mails dated 13.08.2015 and 18.08.2015. There are no other emails which have been filed on record to show the objections raised by the defendant company for the services being provided by the plaintiff company but he can check the company record. He stated that he cannot say that whether any fresh invoice was raised by the plaintiff company after 18.08.2015. The objections which were raised were in relation to that no services were provided by the plaintiff company and they would only had to tell the plaintiff company as to what kind of posts feed backs they had to provide to them. He stated that he needs to check the company record to see whether any objections was raised prior to e-mail dated 13.08.2015. He has admitted that no other document has been filed by the defendant company reflecting the said objections. He stated that he cannot say as to when the plaintiff company abandoned the work being provided by them. Witness after seeing paragraph no.7 of Ex.DW1/A could not tell the exact date when the work was abandoned by the plaintiff company. He denied the suggestion that the defendant company had asked to stop the work. The witness was shown Ex.PW1/10 and states that stopping of the campaign work is different from providing SEO and SMO services. The said campaign work is a part of the SMO services and only a part of the same was stopped by the defendant company. The campaign as mentioned in e-mail dated 13.08.2015 was stopped by defendant. He stated that he would have to check that whether any invoice was raised by the plaintiff company post 17.08.2015. He further stated that he would have to check with his counsel that whether they have filed any form of counter claim against the plaintiff company. After checking the record, the witness stated that there is no counter claim in the court file. The communication between the parties CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 9 of 13 were done through emails and WhatsApp and other convenient ways. The communications between the parties were regarding the agreement, posts, services and feed back. He stated that he cannot say whether the defendant company suffered from any financial loss but they suffered from loss of goodwil. He denied the suggestion that his knowledge in respect of the present transaction is hearsay.
Thereafter, DE was closed and matter proceeded for final arguments.
12. Arguments heard on behalf of both the parties and case file is carefully perused.
13. My issue wise findings are as follows:-
Issue no.1:- Whether this court does not have territorial jurisdiction to entertain the present suit as no cause of action had arisen within the territorial jurisdiction of this Court? OPD.
The onus to prove this issue is on the defendant. The cause of action set out in the plaint is premised on the fact that agreement was entered between the parties at the plaintiff's office at KG Marg, New Delhi and also shown to arose on different occasion when the first invoice was raised and subsequently when other invoices were raised. The plaintiff's office falls within the territorial jurisdiction of this court and also the execution of agreement at the office of the plaintiff gives rise to a valid cause of action in favour of the plaintiff. The defendant has not adduced any evidence to show that the court does not have territorial jurisdiction to entertain the present suit as no cause of action has arisen within the territorial jurisdiction of the court. Accordingly, this issue is decided in favour of plaintiff against the defendant. Issue no. 2:- Whether the plaintiff is not entitled to any relief for its failure to provide services in terms of the contract? OPD.
The onus to prove this issue is on the defendant. As per CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 10 of 13 Ex.PW1/3, the defendant and plaintiff entered into an agreement for availing two type of services/process from the plaintiff which are Search Engine Optimization and Social Media Optimization. The plaintiff was on monthly retainership of Rs.70,000/- for Social Media Optimization. The term of payment for the retainership was "monthly advance payment against the bill".
As per the testimony of PW1 the present dispute is with respect to money owed by the defendant for provision of Social Media Optimization services. It was necessary for the plaintiff to have adduced evidence to prove that the said service was provided to the defendant. However, PW1 deposed before the court that there is no document placed on record or exhibited which shows/demonstrate or proves that the plaintiff company has rendered the services for which money is claimed from the defendant. PW1 also stated that as per the payment mechanism the defendant was supposed to make payment in advance and subsequently the invoice was to be raised by the plaintiff company which makes it amply clear that advance payment was condition precedent for rendering services by the plaintiff. He also deposed that despite receipt of payment the invoice Ex.PW1/7 was raised. It is worth mentioning that Ex.PW1/7 is the first invoice raised by plaintiff to defendant on 15.06.2015 for Social Media Optimization for June, 2015. Further, PW1 deposed that he had no knowledge as to whether the plaintiff company has ever performed its obligation in terms of Ex.PW1/3 and also there is no document to prove the same. As per the testimony of PW1, there is no evidence with the plaintiff company to substantiate the invoices Ex.PW1/7 to Ex.PW1/9. The testimony of PW1 is reflective of fact that the invoices Ex.PW1/7 to Ex.PW1/9 are made without any payment received in advance from the defendant and without any proof of the services rendered. In fact, the raising of first invoice Ex.PW1/7 is in contravention of Ex.PW1/3 which CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 11 of 13 mandates the advance payment by the defendant to the plaintiff for rendering services of Social Media Optimization. Also, the testimony of PW1 show that there is no email or communication by the plaintiff company seeking money in terms of Ex.PW1/3 before raising the invoices.
The plaintiff company is relying on an email dated 18.08.2015 wherein the defendant has asked to pause/hold the campaign till next instruction for substantiating their claim that the services being provided to the defendant till such time after the execution of Ex.PW1/3. However, the said plea runs contrary to the mandate of Ex.PW1/3. The plaintiff has not reasoned out as to why the services were continued for three consecutive months despite no advance payment by the defendant in terms of Ex.PW1/3. Further, no evidence has been produced by plaintiff to show that the services of social media optimization was in fact, rendered to the defendant.
PW1 did state in his cross-examination that it was a manifest obligation on the plaintiff company that the money agreed to be paid by the defendant will only be deemed payable when the services as against the said payment was provided, however, plaintiff was required to prove that he did render the said services. The plaintiff has failed to prove the rendering of services for Ex.PW1/7, Ex.PW1/8 and Ex.PW1/9. Also, no plausible explanation is forthcoming from the plaintiff for non-compliance of the condition of the Ex.PW1/3 wherein upon advance payment by the defendant, the services were to be rendered. In the considered view of this court, the defendant has been successful in discharging the onus placed upon him. Accordingly, this issue is decided in favour of defendant and against the plaintiff.
Issue no. 3:- Whether the plaintiff is entitled to recover a sum of Rs.2,39,400/- from the defendant? If yes, whether the plaintiff is entitled CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 12 of 13 to any interest and at what rate? OPP.
The onus to prove this issue is on the plaintiff. Since, the plaintiff has failed to establish that services were rendered to the defendant as plaintiff could not adduce evidence to support its claim with respect to Ex.PW1/7 to Ex.PW1/9 and itself in contravention of Ex.PW1/3 wherein advance payment was condition precedent for rendering services, the plaintiff is not entitled for the amount claimed with interest in the plaint. Accordingly, this issue is decided in favour of defendant and against the plaintiff.
Relief.
In view of my above issue wise findings, the suit of the plaintiff is hereby dismissed.
No order as to costs.
Decree sheet be drawn accordingly.
File be consigned to record room, after due compliance.
ANNOUNCED IN THE OPEN COURT
ON 24.12.2019 (DR. PANKAJ SHARMA)
ADDITIONAL SENIOR CIVIL JUDGE
PATIALA HOUSE COURT, NEW DELHI
CS No.58741/16
Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 13 of 13 CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd.
24.12.2019 Present: None.
Vide my separate judgment of the even date pronounced in the open court, the suit of the plaintiff is dismissed.
No order as to costs.
Decree sheet be drawn accordingly.
File be consigned to record room after due compliance.
(DR. PANKAJ SHARMA) ADDITIONAL SENIOR CIVIL JUDGE PATIALA HOUSE COURT, NEW DELHI CS No.58741/16 Cross Section Interactive Pvt. Ltd. Vs. MMR Saha Infrastructure Pvt. Ltd. Page No. 14 of 13