Bangalore District Court
M/S. San Engineering & vs M/S. Nepc India Limited on 27 February, 2015
Govt. of Karnataka
C.R.P 67
Form No.9 (Civil)
Title Sheet for
Judgment in Suits
(R.P.91)
TITLE SHEET FOR JUDGEMENTS IN SUITS.
IN THE COURT OF THE XXVI ADDL. CITY CIVIL JUDGE
AT MAYOHALL BANGALORE.
(CCH-20)
Present:
Sri. Mallareppa Veerappa Jadar, B.Sc., LL.B., (Spl.)
XXVI Addl. City Civil and Sessions Judge
Dated this the 27th day of February, 2015.
O.S.No.25769/2009
Plaintiff: M/s. SAN Engineering &
Locomotive Company Limited
A Company incorporated under
the Companies Act 1 of 1956 and
having its Registered Office and
Works at P.B.No.4802, Whitefield
Road, Bangalore - 560048
Represented by its
Company Secretary
Sri. Kishore Govinde
(By M/s. Sreevatsa Associates, )
.Vs.
Defendant : M/s. NEPC India Limited
A Company incorporated under
the Companies Act 1 of 1956 and
having its registered office at
No.1678, Trichy Road, Coimbatore
2 O.S.25769/2009
and Corporate office at No.35,
Wallajah Road, Chennai -600002
Represented by its Managing
Director.
(By M/s. Trial Base)
Date of Institution of suit: 09/04/2009
Nature of the Suit (Suit Money suit
for Pronote, Suit for
Declaration and
Possession, Suit for
Injunction, etc.):
Date of Commencement 18/08/2012
of recording of evidence:
Date on which the 27/02/2015
Judgment was
pronounced:
Total Duration:
Years Months Days
05 10 18
( MALLAREPPA VEERAPPA JADAR)
XXVI Addl. City Civil and Sessions Judge
Mayo Hall, Bangalore.
3 O.S.25769/2009
JUDGMENT
1. This suit is filed by the plaintiff against the defendant for recovery of sum of Rs.49,08,365/- with interest at the rate of 18% p.a. from the date of suit till full payment and such other relief deems fit to grant under the circumstances of the suit.
2. The brief contents of the plaint are that :-> The defendant in requirement of gear boxes for windmill application, pursuant to discussions with the plaintiff, on 11/6/2005 plaintiff addressed a letter to the defendant at its corporate office interalia confirming the price per gear box exclusive of Central Sales Tax and the delivery schedule of the gear boxes and also on 15/6/2005 plaintiff has addressed another letter to the defendant mentioning the delivery schedule and had requested the defendant to release the purchase order. Accordingly, on 23/6/2005 defendant enclosed its purchase order No.013166 dated 22/6/2005 on the plaintiff for 70 gear boxes. The value for 70 gear boxes at the rate of Rs.5,50,000/- per gear box including all applicable taxes and duties was Rs.400.04 lakhs.
4 O.S.25769/2009
3. The defendant on 29/3/2006 informed the plaintiff that it was enclosing a cheque for Rs.28,60,000/-, requested the plaintiff to take back one gear box supplied earlier for rectification and to dispatch to it six fresh gear boxes. On receipt of the purchase order from the defendant it commenced supply of gear boxes to them and under cover of its letter dated 5/4/2006 the plaintiff confirmed having dispatched six gear boxes and enclosed Invoice No :- 05/05-06/S/0174/100% dated 31/3/2006 for Rs.34,32,000/-, original DC cum Excise Gate Pass No.207 dated 31/3/2006 and copy of LR No.001099 dated 31/3/2006 of Vinayaka Carriers.
4. Later on when plaintiff presented the aforesaid cheque of Rs.28,60,000/- for payment, the same was returned with an endorsement "Payment stopped by Drawer" . All the six gear boxes supplied had been tested by plaintiff and were received by the defendant without demur as to quality or quantity and there was no reason for non payment of the value of the said gear boxes. The plaintiff protested against the nonpayment of the cheque by fax dated 26/4/2006 and followed up with a letter dated 27/4/2006 calling upon the defendant to send a demand draft for the value of 5 O.S.25769/2009 the cheque immediately. In turn, the defendant by their letter dated 28/4/2006 requested the plaintiff to send back the cheque and promised to make payment by demand draft in the first week of May 2006. Further on 2/5/2006 and on 8/5/2006 plaintiff had asked the defendants by addressing letters for payment of due through demand draft and defendant orally asked the plaintiff to represent the cheque which was done on 6/9/2006 and again the cheque was dishonoured with the endorsement "Payment stopped by drawer". Consequent upon the non payment of the cheque, a legal notice was issued on 7/10/2006 and thereafter a private complaint was lodged against the defendant, its Managing Director and the signatories of the cheque for an offence under Section 138 of the Negotiable Instruments Act and the case is pending.
5. Defendant also became due an aggregate sum of Rs.3,27,250/- being the value of the differential Central Sales Tax which became payable and was paid by the plaintiff on account of non furnishing of Sales Tax 'C' Forms by the defendant and in respect of which two debit notes dated 30/9/2006 had been raised. In terms of the contract between the plaintiff and defendant as regards late payment, as contained in the plaintiff's tax invoice, the defendant is liable to pay interest at the rate of 18% p.a. for delayed 6 O.S.25769/2009 payments. The defendant is due to it a sum of Rs.28,60,000/- towards value of gear boxes, Rs.3,27,250/- towards differential tax and Rs.17,21,115/- towards interest at 18% p.a. from 9/4/2006 upto date totalling Rs.49,08,365/-. Hence this suit is filed for the recovery of the said sum.
6. With these main averments along with the other averments stated in the plaint prays to decree the same as prayed in the plaint.
7. After service of suit summons the defendant appeared through their counsel and have filed the detailed written statement denying the plaint averments specifically which are against their interest stating that :-> Suit is not maintainable either in law or on facts. Hence, liable to be dismissed in limine. The suit filed by the plaintiff for the recovery of a sum of Rs.49,08,365/- together with interest from the date of suit till payment in full at contracted rate of 18% p.a. along with costs is not maintainable since there is no liability for the defendant to pay any sum to the plaintiff much less the suit claim. The defendant is a company incorporated under the Companies Act having its registered office at Coimbatore and it was the sole and absolute owner of the wind energy division agreed to 7 O.S.25769/2009 transfer and assign its Wind Energy Division as a going concern, in favour of Southern Wind Farms Private Ltd., (SWPL), also a company incorporated under the Companies Act 1956 having its registered Office at 4th Floor, EGA Trade Center, 809, PH Road, Kilpauk, Chennai-600010. Southern Wind Farms Private Ltd., having taken up the business of the Wind Energy Division of the defendant as a going concern, has already tendered the value of the gear boxes, for recovery of which sum, the above suit is filed by the plaintiff.
8. The plaintiff after accepting the cheque bearing No.822221 dated 15/11/2006 drawn on ICICI bank, Nungambakkam Branch, for the sum of Rs.28,60,000/- being the value of the gear boxes from the said Southern Wind Farms Private Ltd., on 15/11/2006 is not entitled to maintain the above suit against this defendant for the recovery of the same amount.
9. The averments made in para No.3 to 14 are not admitted. The defendant has specifically denied that the complaint lodged by the plaintiff against the defendant under Section 138 of Negotiable Instrument Act is towards discharge of any legally enforceable debt and the said complaint is not only bald but also 8 O.S.25769/2009 false without any allegation regarding the transaction referred to in the above suit. The said complaint is being suitably contested by the defendant, wherein, the plaintiff has been examined and also cross-examined. The averments made in paragraph Nos.15 to 17 are all specifically denied as false and the plaintiff is put to strict proof of the same. The cause of action alleged is false and in fact there is no cause of action for filing the suit. The suit is barred by time.
10. With these main averments along with other averments prays to dismiss the suit with exemplary cost.
11. On the pleadings of both the parties, my predecessor in office has framed in all six issues. It is as follows :-
ISSUES
1. Whether plaintiff proves that an amount of Rs.28,60,000/- was due from defendant towards value of gear boxes?
2. Whether plaintiff proves that an amount of Rs.3,37,250/- is due towards differential taxes?9 O.S.25769/2009
3. Whether defendant proves that plaintiff has accepted sum of Rs.28,60,000/- through cheque from it?
4. Whether plaintiff is entitled for interest?
5. Whether plaintiff is entitled for relief sought for?
6. What order or decree?
12. In order to prove its case, the Company Secretary of plaintiff's company is examined as P.W.1. He has filed his affidavit by way of examination-in-chief. In the further examination-in-chief got marked in all 10 documents as Ex.P.1 to Ex.P.10. On the defendant's side, Director of defendant company Mr.Tirupathi Kumar Khemka has filed his affidavit as D.W.1. In the further examination-in-chief has got marked 3 documents as Ex.D.1 and Ex.D.3.
13. After closure of evidence, posted for arguments. Inspite of sufficient opportunity given to both the parties, they have not canvassed their arguments. Hence posted for judgment. 10 O.S.25769/2009
14. My answer to the above issues are as follows :-
ISSUE NO.1 :- In the affirmative,
ISSUE NO.2 :- In the negative,
ISSUE NO.3 :- In the negative,
ISSUE NO.4 :- In the partly affirmative,
ISSUE NO.5 :- As per final order
for the following
REASONS
15. ISSUE NO.1 :- This Issue is on the plaintiff. In this Issue, plaintiff has to prove that, an amount of Rs.28,60,000/- was due from the defendant towards the value of the gear box. In the plaint para No.4 to 6, plaintiff has pleaded that :-> Under a cover of its letter dated 23/6/2005 the defendant enclosed his purchase order No.013166 dated 22/6/2005 on the plaintiff for 70 gear box. In para No.5 of the plaint pleaded that :-> The total value of the order for 70 gear box at the rate of Rs.5,50,000/- per gear box with all applicable taxes and duties was Rs.400.04 lakhs. In para No.6 pleaded that :-> By letter dated 29/3/2006 the defendant informed the plaintiff that :-> It was enclosing cheque for Rs.28,60,000/-, requested the plaintiff to take back one gear box supplied earlier for rectification and to discharge to it six fresh gear boxes. In para No.7 11 O.S.25769/2009 has pleaded that :-> Against the aforesaid purchase order it has commenced supply for gear box to the defendant. In para No.8 of the plaint pleaded that :-> aforesaid cheque for Rs.28,60,000/- when presented for payment was returned with an endorsement. These are the pleadings pleaded in the plaint regarding defendant's liability to pay sum of Rs.28,60,000/- towards the value of the gear box.
16. In the written statement, defendant has not denied the supply of gear box by the plaintiff. On the other hand, in para No.2 of the written statement pleaded that :-> -- - - - - - -The defendant which was sole and absolute owner of the wing energy division agreed to transfer and assign its wing energy division as a going concern in favour of Southern Wind Farms Pvt. Ltd. (SWPL) also a company incorporated under the Companies Act 1956 - - - - - . Further pleaded that :-> SWPL having taken up the business of the wing energy division of the defendant as a going concern has already tendered the value of the gear boxes for recovery of same, the above suit is filed by the plaintiff. In para No.3 of the written statement, defendant has pleaded that :-> Plaintiff after accepting the cheque for Rs.28,60,000/- being the value of the gear boxes from the said Southern Wind Farms Pvt. Ltd., dated 15/11/2006 is not 12 O.S.25769/2009 entitled to maintain the above suit against this defendant. This pleadijng goes to show that, the defendant has admitted the transaction and also issuance of cheque to the sum of Rs.28,60,000/- from M/s. SWPL company after taking up the business of Wind Energy division of the defendant.
17. The P.W.1 is the Secretary of the plaintiff's company has filed the affidavit by reiterating the above said plaint averments in para NO.4 to 6 of the affidavit. On the other hand, the D.W.1 in his affidavit filed by way of examination-in-chief has reiterated the above averments of the written statement in para No.2 and 3 of the affidavit. On perusal of the above referred pleadings and the contents of the affidavit filed by way of examination-in-chief by P.W.1 and D.W.1 the contract is not denied, supply of goods is not denied. The only controversy is that :-> Value of the goods supplied is Rs.28,60,000/- is yet to be paid by the defendant as per the case of the plaintiff. Per contra, as per the case of the defendant, the said amount is already paid through cheque by the company M/s.SWPL which has taken up the business of the Wind Energy Division from the company of the defendant. On perual of the document produced by the plaintiff marked as Ex.P.1 to Ex.P.10, it is seen that, Ex.P.7 is the letter dated 28/4/2006 issued by the 13 O.S.25769/2009 defendant company to the plaintiff's company through a fax in which it is mentioned that :-> - - - - - Please send back our cheque No.556335 dated 15/4/2006 for Rs.28,60,000/- drawn on Canara Bank, Chintadripet, Chennai, so that we can organise necessary payment by D.D. during the first week of May 2006. This contents of Ex.P.7 clearly goes to show that, defendant has requested the plaintiff to return the cheque issued to the sum of Rs.28,60,000/- with further request that, they can organise necessary payment by D.D. in the first week of May 2006. On perusal of the document produced by the defendant and marked as Ex.D.1 to Ex.D.3, none of the documents discloses that, the defendant has paid the said amount through D.D. When such being the case, on the above referred materials the plaintiff has proved that, he has supplied the gear box of value of Rs.28,60,000/- to the defendant. Though defendant has issued the letter as per Ex.P.7 requesting the plaintiff to return the cheque so as to enable him to pay the amount through D.D. nothing is placed by the defendant to show that, he has made payment of said sum through D.D. to the plaintiff. Hence, on all these grounds, plaintiff proved that, an amount of Rs.28,60,000/- is due from the defendant towards the 14 O.S.25769/2009 value of the gear box. Accordingly, I answered Issue No.1 in the affirmative.
18. ISSUE NO.2 :- In this Issue, plaintiff has to prove that, an amount of Rs.3,27,250/- is due towards the differential taxes. In the plaint at para No.15 plaintiff has pleaded that :-> The defendant also become due an aggregated sum of Rs.3,27,250/- being the value of differential Central Sales Tax which becomes payable and was paid by the plaintiff on account of non furnishing sales tax 'C' forms by the defendant. So as to establish this plea, no documentary evidence is produced by the plaintiff. Ex.P.9 and Ex.P.10 produced by the plaintiff shows that, he has issued the debit note to the defendant mentioning the particulars of the tax amount. In Ex.P.9 he claimed to Rs.46,750/- and in Ex.p.10 he sought for sum of Rs.2,80,500/- towards duty tax. It is claimed through Ex.P.9 and Ex.P.10 debit notes. But, there is no documents to show that, he has paid that much of sum towards the difference of tax amount. Under such circumstances, plaintiff has failed to establish his claim of Rs.3,27,250/- due towards the differential taxes. No doubt, in the plaint, para No.15 plaintiff has pleaded that :-> On account of non furnishing the sales tax 'C' Forms by the defendant, he was liable to pay aggregate sum of 15 O.S.25769/2009 Rs.3,27,250/-. This plea is not proved by producing acceptable documentary evidence on record stating that -> he has paid the said sum on account of failure of defendant to furnish the sale tax 'C' form. On such and such a date either through cash or through D.D. etc., When such being the case, plaintiff has failed to prove that, he paid the aggregated tax amount and the defendant is liable to pay sum of Rs.3,27,250/- towards the differential tax amount to him. Accordingly, I answered Issue No.2 in the negative.
19. ISSUE NO.3 :- This Issue is on the defendant. In this Issue, defendant has to prove that, plaintiff has accepted sum of Rs.28,60,000/- through cheque from it. In the written statement in para No.3 defendant has pleaded that, cheque is issued to the sum of Rs.28,60,000/-. But, his own document sent to the plaintiff marked as Ex.P.7 dated 28/4/2006 goes to show that, the defendant has requested the plaintiff to return the cheque as the recital in the said document is that :-> Please send back our cheque No.5563351 dated 15/4/2006 for Rs.28,60,000/- drawn on Canara Bank, Chintadripet, Chennai, so that we can organise necessary paryment by D.D. during first week of May 2006. This contents of Ex.P.7 letter shows that, defendant has requested the plaintiff to return the above said cheque. In the event if the plaintiff did not 16 O.S.25769/2009 return the said cheque, in such event the defendant ought to have produced the copy of the ledger extract of the said bank transaction pertaining to the defendants account so as to prove that, the said cheque was encashed by the plaintiff. But in this case, no such document is produced by the defendant. Under such circumstances, defendant has failed to prove that, plaintiff has accepted sum of Rs.28,60,000/- through the cheque and the cheque is got encashed in favour of the plaintiff. On the other the defendant himself requested plaintiff to return the said cheque by sending letter marked as Ex.P.7. On all these grounds I answered Issue No.3 in the negative.
20. ISSUE NO.4 :- In this Issue, it is to be determined whether the plaintiff is entitled for interest. In the plaint, para No.17 the plaintiff has sought for interest at the rate of 18% per annum from 9/4/2006 upto date, of Rs.17,21,115/-. But, to prove his entitlement to receive the said percentage of interest, he has not produced any agreement stated to be entered between him and the defendant. On the other hand, in para No.16 of the plaint, plaintiff has pleaded that, in terms of contract between it and the defendant as regards late payment as contended in the plaintiff's fax invoice, the defendant is liable to pay interest at the rate of 18% per annum 17 O.S.25769/2009 for delayed payment. The contents of the fax invoice cannot be termed as a document of contract pertaining to the terms of contract regarding the payment of interest in case of default of payment within the specified period. When such being the case, plaintiff has failed to prove that, he is entitled for interest at the rate of 18%. But, on perusal of the pleadings, evidence etc., it is seen that, the transaction between the parties is in connection with the business transaction. Under such circumstances, it is just and proper to award reasonable rate of interest prevailing in the nationalised bank during the said period. Hence, by considering all these aspects, I am of the considered view that, it is just and proper to award the interest prevailing in the nationalised bank during the relevant point of time or not less than at the rate of 10% on the said sum from the date of institution of suit till the date of realisation. Accordingly, I answered this Issue in the partly affirmative.
21. ISSUE NO.5 :- This issue is on the plaintiff. In this Issue it is to be determined whether the plaintiff is entitled for the relief sought for. In the plaint, plaintiff has sought for relief for recovery of sum of Rs.49,08,365/- with interest at the rate of 18% p.a. from the date of suit till full payment and such other relief 18 O.S.25769/2009 deems fit to grant under the circumstances of the suit. On the above discussed facts and circumstance of the case, I am of the considered view that, plaintiff is entitled for recovery of Rs.28,60,000/- from the defendant and not entitled for the sum of Rs.3,27,250/- towards the differential tax amount. But the plaintiff is entitled for interest on Rs.28,60,000/- at the rate of 10% per annum from the date of institution of suit till realisation. Accordingly, Issue No.5 is answered partly in the affirmative.
22. ISSUE NO.6 :- For the reasons stated to Issue No.1 to 5, I proceed to pass the following :-
ORDER In the result, suit of the plaintiff is partly allowed.
In the consequences, defendant is directed to pay a sum of Rs.28,60,000/- (Rupees twenty eight lakhs sixty thousand only) to the plaintiff with interest at the rate of 10% from the date of institution of suit till the date of realisation.19 O.S.25769/2009
The defendant is directed to pay the said sum within three months from the date of this judgment.
In the event of failure of defendant to pay the said sum, plaintiff is at liberty to recover the said sum by proceeding against the defendant's property in accordance with law.
Parties are directed to bear their respective cost of this proceedings.
Draw decree accordingly.
(Dictated to the Judgment-Writer, transcript thereof, is corrected and then pronounced by me in the open court on this the 27th day of February 2015) ( Mallareppa Veerappa Jadar ) XXVI Addl. City Civil and Sessions Judge Mayo Hall, Bangalore.
ANNEXURE
1. List of witnesses examined for the plaintiff/s:
P.W.1 Mr. Kishore Govinde 20 O.S.25769/2009
2. List of witnesses examined for defendant/s:
D.W.1 Mr. Tirupathi Kumar Khemka
3. List of documents exhibited for the plaintiff/s:
Ex.P.1 Letter from plaintiff dated
15/6/2005
Ex.P.2 Letter from defendant dated
23/6/2005
Ex.P.3 Purchase order copy
Ex.P.4 Sri Vinayaka Carriers - Consigner's
copy
Ex.P.5 Certified copy of cheque dt.
15/4/2006
Ex.P.6 Certified copy of bank endorsement
Ex.P.7 Letter from defendant dt.
28/4/2006
Ex.P.8 Notice 7/10/2006
Ex.P.9 & 10 Debit notes
4. List of documents exhibited for defendant/s:
Ex.D.1 Certified copy of NEPC Slump sale
agreement
Ex.D.2 Certified copy of PCR No.6257/2006
Ex.D.3 Certified copy of evidence in CC
No.26819/2007 on the file of SCCH-
21.
( MALLAREPPA VEERAPPA JADAR)
XXVI Addl. City Civil & Sessions Judge
Mayo Hall, Bangalore.