Delhi District Court
M/S. J.N. Petrochemicals Pvt. Ltd vs M/S. Gill International Ltd on 30 July, 2018
IN THE COURT OF SH. JOGINDER PRAKASH NAHAR, ADDITIONAL
DISTRICT JUDGE-04, CENTRAL, TIS HAZARI COURTS, DELHI
CS No. 215344/10
M/S. J.N. PETROCHEMICALS PVT. LTD.
(A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956)
HAVING ITS REGISTERED OFFICE AT
B.D. CHAMBERS, 10/54, D.B. GUPTA ROAD
KAROL BAGH, NEW DELHI ......Plaintiff
Versus
1. M/S. GILL INTERNATIONAL LTD.
(A COMPANY REGISTERED UNDER THE COMPANIES ACT, 1956)
R-40, SOUTH EXTENSION, PART II
NEW DELHI-110049
THROUGH ITS DIRECTOR
SH. RAMESH KUMAR BATRA
2. SH. R.N.S. GILL
H.NO. 131, SECTOR 28
NOIDA, U.P. ......Defendants
Date of Institution : 01.12.1994
Date of judgment reserved on : 28.07.2018
Date of judgment : 30.07.2018
JUDGMENT
SUIT FOR RECOVERY, PERMANENT INJUNCTION AND MANDATORY INJUNCTION BRIEF FACTS AND REASONS FOR DECISION :-
1. The plaintiff has filed the present suit through Mr. Harish Goel, the Managing Director of the plaintiff company. Defendant No. 1 is incorporated company, whose earlier name was M/s G. International Consultants and later on incorporated as M/s Gill International Company by importing rights and liabilities of previous appointment letters issued by M/s G. International Consultants. The defendants are registered as importer of LPG cooking gas with RBI for marketing and distribution of LPG under brand name Gildan LPG.
2. Vide appointment letter dt. 26.6.1993, defendant No. 1 had appointed plaintiff as LPG distributor for the state of Rajasthan, 11 Districts in Haryana, namely Rohtak, Bhiwani, Hissar, Sirsa, Panipat, Sonipat, (except Kharkhoda), Jind, Rewari, Gurgaon, Faridabad (except Ballabgarh and Mahendergarh).
Plaintiff was authorised to book only four lakhs connections by December, 1993. The booking was free, however, the cost of form was Rs. 100/-. The form was prescribed by the defendant. The cost of form was to be charged from consumers and it was non-refundable. The 20% of the amount of cost was payable by defendant No. 1 to the plaintiff as subsidy.
3. Rs. 1,500/- refundable security was to be charged from consumers and it had to be remitted to defendant No. 1. The plaintiff company was authorized to charge extra Rs.200/- as refundable security from consumers which had to be refunded at the time of surrender of possession. Plaintiff was entitled to commission of Rs. 15 per cylinder. Plaintiff was required to deposit a sum of Rs. 25 lakhs as refundable interest free security with defendant No. 1. The said amount was deposited from 19.06.1993 till 13.07.1993 for a sum of Rs. 15 lakhs in pursuance of agreement dt. 26.06.1993. The balance amount of Rs. 10 lakh was required to be deposited by 28.08.1993 which could not be deposited due to certain doubts created due to conduct of defendant No. 1 and also because defendant No. 1 had instructed plaintiff to stop the booking till the requirement of certain licences. Plaintiff has also applied vide letter dt. 23.8.1993 for extension of time for security deposit and for payment for a sum of Rs. 10 lakhs till 31.12.1993.
4. Plaintiff had appointed 22 sub-dealers for booking LPG cylinders. The sub-dealers were facing problems due to rumours of the credibility of defendant No. 1 and objections raised by District Food and Supplies Controller, Haryana, regarding collection of Rs. 100/- as cost of form. Plaintiff has written 2 letters to defendant No. 1 on 18.08.1993 regarding said order by District Food and Supplies Controller. The defendant No. 1 had appointed Suvidha Gas Distributor, Bhilwara even without informing the plaintiff company as distributor for 9 district in Rajasthan where plaintiff was already appointed as distributor. When the said matter was discussed with defendant No. 1 it was agreed that plaintiff company is exempted from depositing balance security for a sum of Rs. 10 lakhs.
5. As per arrangement, the booking forms were to be supplied by defendant No. 1 to the plaintiff for supply of the same to sub-dealers. The booking form had to be applied in triplicates. Sub-dealers had to return one copy of form for booking of connection, one copy was to be kept by sub- dealers and the third copy was required to be returned back to the plaintiff along with cost of the form after deducting 10% as their subsidy. The third copy had to be submitted by plaintiff to defendant No. 1 along with cost after deducting 20% as subsidy to which no time limit was prescribed. Plaintiff has already deposited Rs. 10,06,120/- with defendant No. 1 as cost of the form. However, Government of Haryana has publicised for not depositing and for not charging cost from consumers. It is submitted by the plaintiff at para No. 14 that Joint Secretary P&NG had issued a circular to the Secretary, Food and Govt. Supplies Departments, of all State Governments and Union Territory. Due to the said circulars, the plaintiff could not collect cost of forms @ Rs.100/- at the stage of booking. Infact, the Food and Supplies Controller, Bhiwani had issued a letter to refund the amount taken from the consumers. The above fact was brought to notice of defendant No. 1. Defendant No. 1 has become adamant to continue to charge the said Rs. 100/- from the consumers. The defendant No. 1 had also approached to the Court of competent jurisdiction against such order of the Government in which defendant No. 1 was lost. Due to the above facts more than 50% of sub- dealers appointed by the plaintiff had resigned from dealership which caused loss in reputation and money to the plaintiff. The sub-dealers were threatened up with punitive action by the Government authorities and they had returned the unlisted blank forms to the plaintiff which defendant No. 1 had declined to take back from the plaintiff and insisted on payment of Rs. 100/- per form. Defendant No. 1 had intimated plaintiff vide letter dt. 23.11.1993 that Rs. 4.75 lakhs are pending cost of booking forms and threatened to charge interest @ 48% per annum, if dues not paid by 30.11.1993 to be further forfeited from the security deposits. Plaintiff had duly replied that the amount is already refunded as per instructions of the Government authorities and objected to charging of any interest.
6. The defendant again wrote letter in 24.12.1993 for payment of Rs. 5 lakhs on account of security deposits instead of Rs. 10 lakhs to be paid by 31.12.1993. The said demand was made contrary to prior agreement between the parties which was duly replied by the plaintiff. Defendant No. 1 had illegally debited the security amount of the plaintiff with interest with threat to cancel agreement of distributorship. The plaintiff could not start the supply of LPG till June 1994 as the defendant No. 1 had not supplied the same due to the fact that the bottling plant was completed only by 06.06.1994. Defendant No. 1 again wrote letter dt. 15.09.1994 and dt. 15.11.1994 claiming Rs. 6,25,000/- as cost of form with threat to debit interest from the security deposits and threat that distributorship agreement shall stand cancelled. The said letter was duly replied by the plaintiff. Plaintiff had also invested huge amount of Rs. 5 lakhs on construction of LPG godown for product of defendant No. 1.
7. Sometime in July 1994, defendant No. 1 started supplying LPG directly to the sub-dealers of the plaintiff without any information to the plaintiff which amounted to breach of contract and deprived plaintiff company for commission of Rs.15 per cylinders as per agreement dt. 26.6.1993. The refilling is directly provided to sub-dealers and thereby, by August 1995, all the sub-dealers had snapped tie with the plaintiff. Most of the sub-dealers had resigned. Due to this plaintiff could not continue business of distributorship. Plaintiff was therefore entitled to cancel the agreement dt. 26.6.1993 and thereby, gave notice to the defendant to such effect. Vide order dt. 20.11.1998, Hon'ble High Court of Delhi has restrained defendants from forfeiting security deposits of the plaintiff company and that distributor agreement shall not be cancelled.
8. Hence, the defendant No. 1 is liable to return Rs. 10,06,120/- as cost of booking forms paid by the plaintiff and Rs. 15 lacs, the security given by the plaintiff. No supply of LPG cylinders was ever made by defendant No. 1 to the plaintiff and thereby, due to such fault of defendant No. 1, the plaintiff is also entitled to interest @ 18% per annum. However, plaintiff has prayed for recovery of Rs. 15 lakhs and Rs. 4,50,000/- with interest @ 18% per annum from the defendants. Mandatory injunction is also prayed against the defendants for no liability for payment of Rs. 4.75 lakhs towards cost of booking forms by the plaintiff to the defendant. Permanent injunction is also prayed against the defendant in not to recover that amount with interest or penalty from the plaintiff. Accordingly, plaintiff has prayed for decree of his suit for recovery, permanent injunction and mandatory injunction against the defendants along with cost of the suit.
9. Written Statement is filed by defendant No. 1 praying that the suit is barred by limitation. The cause of action arose on 15.11.1994 and the amendment is made in the year 2006. Court fees is also filed after more than three years of the amendment of the plaint. The agreement dt. 26.6.1993 with the plaintiff is admitted and also the appointment letter dt. 26.6.1993. The area in which plaintiff was authorized to book regular connections is admitted. The security deposit of Rs. 15 lakhs is admitted by the defendant which is refundable with interest fees. It is admitted that defendant supplied booking forms to the plaintiff against which defendant had received part payment. Plaintiff has yet to pay Rs. 4,75,000/-. The copies of forms are admitted as correct. It is submitted that without supply of forms in copy, the defendant could not supply the gas. It is admitted by defendant that defendant company was constructing bottling plant on 04.07.1994.
10. The defendant has submitted that plaintiff has failed to deposit the balance security of Rs. 10 lakhs as plaintiff did not have the said amount to pay to the defendant. Defendant No. 1 has denied of having given instructions to the plaintiff to stop booking till procurement of certain licences. Plaintiff has not mentioned how much amount the plaintiff has achieved from sub-dealers towards security and how many members of gas connection for LPG has been booked by the plaintiff and the sub-dealers. The plaintiff did not supply the said details. Issuing of appointment letter to sub-dealers is denied and that plaintiff has failed to file any such letter. The gas was regularly supplied by defendant No. 1 to the consumers through dealers or distributors.
11. Defendant at para 8 of written statement at page 5 has submitted regarding collection of Rs. 100/- from the consumers. The defendant No. 1 had written to District Food and Supply Controller, after which the said authorities never raised any issue in this regard. The defendant has sent 17,500/- forms to the plaintiff which were not accounted by the plaintiff nor returned the same. The plaintiff could not achieve the target of booking of LPG connection. Defendant has right to appoint any person as distributor or dealer other than plaintiff. Letter dt. 17.09.1993 is denied. It is denied that the Government has issued any circular against collection of Rs. 100/- as cost of forms. No circular or even newspaper report is filed by the plaintiff. Circular from Joint Secretary, Petroleum of Natural Gas, New Delhi is denied. The plaintiff has not given full details of account and forms. Plaintiff has not paid the amount received form customers nor returned the unused forms. Letter dt. 23.11.1993 issued by the defendant is admitted. Letter dt. 24.12.1993 is denied in regarding reducing of security amount. It is submitted that plaintiff does not have storage facility as per rules of Controller of explosives failing which, defendant cannot supply gas directly to the plaintiff. Nor plaintiff has raised any order for supply of gas. Other averments of the plaintiff are denied and it is prayed that suit of the plaintiff may be dismissed with costs.
12. Replication is filed by the plaintiff in which plaintiff has reaffirmed the averments made in the plaint and denied the averments of the defendant.
13. On the pleadings of the parties and averments made following issues are framed in the suit on 17.07.1998:
1. Whether the plaintiff has paid proper Court fee in the present suit? If not, its effect?
2. Whether the defendant company is legally entitled to Rs.4,75,000/- towards the cost of booking forms at Rs.100/- per form as demanded by the defendant company?
3. Whether the plaintiff company was entitled to a commission at rate of Rs.15 per cylinder in terms of the agreement dated 23.06.1993?
4. Whether the defendant company was empowered to cancel the Distributorship agreement dated 26.06.1993 issued in favour of the plaintiff company and also forfeit the security as stated by the defendant company in their letter dated 15.11.1994?
5. Whether the plaintiff is entitled to any relief as claimed in the suit after rendition of accounts by the parties and if so, what is the amount due and payable to the plaintiff company by the defendant company?
14. On the pleadings of the parties and averments made following additional issues were framed on 04.08.2011 which are renumbered as follows:
6. Whether the plaintiff is entitled for the recovery of Rs.15,00,000/- and Rs.4,50,000/- in terms of prayer (a) of the amended plaint? OPP
7. Whether the plaintiff is entitled for interest? If so at what rate and for which period? OPP
8. Whether the plaintiff is entitled for the mandatory injunction in terms of prayer (b) of the amended plaint? OPP
9. Whether the plaintiff is entitled for the permanent injunction in terms of prayer (c) of the amended plaint? OPP
10. Whether the plaintiff is entitled for the decree? OPP
11. Whether the suit is barred by limitation. Onus on parties.
12. Relief, if any.
15. Plaintiff has got examined PW-1 Sh. Harish Goel, PW-2 Sh. Dr. Vivek Kumar, Controller of Explosive, PW-3 Sh. Banarasi Lal, Assistant Food and Supply Department, Haryana, PW-4 Sh. Dilbagh Singh, Clerk from office of Food and Supplies Controller, Bhiwani, Haryana, and PE was closed on 26.09.2017. Defendant has not led any evidence in the case and closed his DE through Counsel vide separate statement dt. 07.12.2017.
16. Parties heard and record perused. My issuewise findings as follows:-
17. ISSUE NO. 1Whether the plaintiff has paid proper Court fee in the present suit? If not, its effect?
17.1 The burden of proof of the present issue is on the defendant. The defendant has not led any evidence on the above issue and in cross- examination of PW-1 no suggestion is put to PW-1 with regard to payment of proper Court fees in the present matter. Hence defendant has failed to discharge his onus regarding the present issue. Accordingly present issue is decided against the defendants and in favour of plaintiff.
18. ISSUE NO. 2, 8 AND 92. Whether the defendant company is legally entitled to Rs.4,75,000/- towards the cost of booking forms at Rs.100/- per form as demanded by the defendant company?
AND
8. Whether the plaintiff is entitled for the mandatory injunction in terms of prayer (b) of the amended plaint? OPP AND
9. Whether the plaintiff is entitled for the permanent injunction in terms of prayer (c) of the amended plaint? OPP 18.1 The burden of proof of the present issue No. 2 is on the defendant answer to which will automatically give answer to issue no. 8 and 9. The defendant has demanded cost of Rs.100 per form from the plaintiff. The cost of Rs.100 per form is a printing cost of form duly charged by the defendants as non refundable amount in terms of para no. 3 of Ex.P-1 the contract dated 26.06.1993. Plaintiff is required to recover the said cost from the customer. Ex.P-1 is an admitted document and therefore the same is admitted fact between the parties.
18.2 The plaintiff has deposed as PW-1 deposing at para no. 5 of evidence by way of affidavit Ex.PW1/A that 20% of the said cost was payable by defendant company to the plaintiff company as subsidy. The same deposition of PW-1 is in consonance with admitted agreement Ex.P-1 at para no. 3 wherein the 20% of the amount has to be passed to the distributor as an incentive as subsidy. PW-1 has deposed at para no. 8 of Ex.PW1/A that the District Food and Supplies Controller in Haryana has raised objections in regard to collection of Rs.100/-. Two letters dated 18.08.1993/Mark A to defendant no. 1 regarding the said objections to which defendant no. 1 had written letter dated 23.08.1993/Ex.P-24 to the Food and Supplies, Rohtak for collection of Rs.100/- further communication to which was not supplied to PW-1/plaintiff on the ground that these are confidential documents. There is no material cross examination of PW-1 on behalf of defendants on Mark A and Ex.P-24. In absence of which the same remains unrebutted document between the parties. Ex.P-12 is letter to the defendants by the plaintiff dated 30.11.1993 intimating that payments are awaited from sub-dealers as the booking amount has been refunded by the sub-dealers on instructions from authorities which plaintiff has already refunded to all sub-dealers. The helpless dealers have no alternative but to comply with instructions of authority. The said letter is admitted document between the parties Sh. Banarasi Lal, PW-3 has brought summoned record from Director of Food and Supply from Haryana who has proved Mark R on record which is copy of letter available with PW-3 in original dated 20.09.1993 and exhibited as Ex.PW3/A. Hence Mark R=Ex.PW3/A has been proved on record by the plaintiff. Cross-examination of PW-3 is nil by the defendants. The said Ex.PW3/A dated 20.09.1993 gives direction to the entire State of Haryana that decision has been taken that private entrepreneurs should give free booking to the public in future for booking LPG connections. Hence the demand of the defendant for such payment of cost of form of Rs.100 is unjustified and demand if any is required to be made is either by the customers who has made bookings or by the Government who has made direction to give free bookings of LPG connection. The defendants have failed to prove that they are entitled to the cost of booking form @ Rs.100 per form. In view of the above it is held that defendants in absence of having led any evidence in this regard has failed to discharge burden of proof levied upon them and accordingly present issues are decided against the defendants and in favour of plaintiff. Hence plaintiff is held entitled to permanent and mandatory injunction against the defendant for such demand of booking of forms.
19. ISSUE NO. 3Whether the plaintiff company was entitled to a commission at rate of Rs.15 per cylinder in terms of the agreement dated 23.06.1993?
19.1 The burden of proof of the present issue is on the plaintiff. The agreement dated 23.06.1993 is Ex.P-1 on record. As per para no. 5 of Ex.P-1 the commission of Rs.15 per cylinder will be paid to the plaintiff for domestic and commercial connection. The defendants has not led any evidence nor disputed the above fact in cross-examination of PW-1. Ex.P-1 is an admitted document between the parties and hence it is held that plaintiff company is entitled to commission of Rs.15 per cylinder in terms of Ex.P-1. Accordingly present issue is decided in favour of plaintiff and against the defendants.
20. ISSUE NO. 4Whether the defendant company was empowered to cancel the Distributorship agreement dated 26.06.1993 issued in favour of the plaintiff company and also forfeit the security as stated by the defendant company in their letter dated 15.11.1994?
20.1 The burden of proof of the present issue is on plaintiff. Under/sec. 185 of Indian Contract Act, 1872 (hereinafter referred as The Act) no consideration is necessary to create an agency. Under/sec. 186 of the Act the authority of any agent may be express or implied. Under/sec. 197 of the Act the ratification of the Act of the agent may be express or implied on behalf of the person for whom the acts are done. Under/sec. 203 of the Act the principal may revoke the authority given to the agent at any time before the authority has been exercised subject to Section 202 of the Act whereby the agent has himself has interest in the property of subject matter of agency then the agency cannot in the absence of express contract be terminated to prejudice of such interest. Section 202 of the Act has laid down that where there is express or implied contract that agency should be continued for any period of time then principal must make compensation to the agent for any previous revocation or renunciation of agency without sufficient cause with a reasonable notice.
20.2 The creation of agency between the parties is thereby remains admitted vide Ex.P-1. The area in which the plaintiff was authorised to book regular connection is admitted. Security deposit of Rs.15 lakhs is admitted by the defendant. It is admitted by the defendant that he has supplied the booking forms to the plaintiff against which defendant has received part payment. According to the defendant plaintiff has to pay Rs.4,75,000/-. However defendant has not led any evidence in defence. Thereby defendant has no evidence to rebut the denial of the plaintiff for such claim of Rs.4,75,000/- on behalf of defendant.
20.3 It is case of the defendant that plaintiff has failed to deposit balance security amount of Rs.10 lakh as plaintiff did not have said amount. On this defendant no. 1 has denied of having given any instruction to plaintiff to stop booking till procurement of the licence. The plaintiff did not supply detail of amount received by the plaintiff from sub dealers towards security and the number of members booked for LPG gas connection. It is submitted that defendant no. 1 was regularly supplying gas/LPG to consumers, to dealers or distributors. The plaintiff has submitted that initially a sum of Rs.25 lakh was to be deposited as refundable security with interest with defendant no. 1 and Rs.15 lakh was deposited on 19.06.1993 till 13.07.1993 in pursuance of agreement dated 26.06.1993. The balance amount has to be deposited by 28.08.1993 which could not be deposited due to doubt created by defendant no. 1 who had instructed the plaintiff to stop the booking till the requirement of certain licencees are fulfilled. Further the District Food and Supply Controller had issued two letters to defendant no. 1 on 18.08.1993 for not collecting Rs.100/- as cost of form. The defendant no. 1 had appointed Suvidha Gas Distributor, Bhilwara without informing the plaintiff for nine district of Rajasthan and thereby created duplicacy of distributorship. When the matter was discussed with defendant no. 1 then the defendant had exempted plaintiff from depositing balance security for a sum of Rs.10 lakh. To the contrary the defendant no. 1 has submitted that plaintiff did not had sufficient infrastructure to receive the LPG Gas cylinders and thereby the same could not be supplied to him. It is submitted that plaintiff does not have storage facility as per rules of controller of explosives failing which the defendant cannot supply directly gas to the plaintiff. Plaintiff has also not raised any order for supply of gas.
20.4 Thereby, the above pleadings between the parties shows that there was executable agency between plaintiff and defendant despite of non payment of Rs.10 lakhs by the plaintiff to the defendant as defendant was ready to supply LPG to the plaintiff but only due to the reason that the plaintiff did not had storage facility as prescribed by the rules and directions of Controller of Explosives. In view of above admissions the defendants have admitted the exemption of payment of Rs.10 lakhs by the plaintiff to the defendant and only on account of such exemption defendant was ready to supply the LPG to the plaintiff but for the reason stated above. Hence the contract of principal and agent was complete between plaintiff and defendant. It is further supported by the conduct between the parties in that defendant has admitted receipt of part payment of booking of forms from the plaintiff and that the defendant would not supply the gas without supply of forms in copy. The defendant has submitted that plaintiff has not mentioned that how much amount plaintiff has received through sub- dealers towards security and how many members of gas connection for LPG has been booked by the plaintiff. It shows that there is creation of agency through plaintiff and through the sub-dealers who again became agent of the defendant through plaintiff. Hence by such pleading and conduct between the contract of principal and agent is complete between the parties. In such completion of contract between the parties they are liable to account each other for the same.
20.5 According to the defendants the contract of principal and agent had not been completed due to non payment of cost of security by the plaintiff/agent. However the above plea of the defendant cannot be accepted in view of deposition of PW-1 that LPG connections were registered by him as a distributor and by appointing sub-dealers under knowledge and authority of defendant company. Defendant has suggested the plaintiff that plaintiff has not returned the unused forms while booking the LPG connection. It shows that the forms were supplied by the defendants to the plaintiff for issue of LPG connections and hence there is implied completion of contract between the parties.
20.6 The onus of proof has shifted on the defendant that defendant was empowered to cancel distributorship of the plaintiff which had begun vide distributorship agreement dated 26.06.1993. The defendant has not led any evidence in defence. In cross-examination of PW-1 it is put by defendants to plaintiff that plaintiff did not return unused form without asking that how many unused form had to be returned by the plaintiff and thereby it is no evidence. Another question put by the defendants to the plaintiff is regarding availability of licence from explosives department with the plaintiff to store the LPG cylinder. The PW-2 is Controller of Explosives, Chandigarh, Delhi who has not produced record pertaining to licence bearing no. HN262CGS dated 09.08.1995 issued in the name of plaintiff due to the reason that the file of said licence was not available in the office which comes under jurisdiction of Faridabad office. It was intimated to Faridabad office vide letter Ex.PW2/A. Vide the letter in reply Ex.PW2/B the office of PW-2 was intimated that the licence was expired in the year 1997. The attested copy of concerned page of the concerned register of the said licence at serial no. 141 is Ex.PW2/C. Cross-examination of said witness is nil. Hence licence was available with the plaintiff vide Ex.PW2/B from 09.08.1995 till the year 1997. Hence it is for the defendant to show that he had reason to cancel agency of the plaintiff. In fact in cross-examination of PW-1 the defendant has not asked any question to the plaintiff's witness regarding non availability of licence for particular period to cancel the agency. Agency has started between the parties when no licence was available with the plaintiff and same was the condition accepted by the defendants at the relevant time as discussed above. In such circumstances of the case and when no notice of cancellation of licence was issued by the defendants (as per evidence produced) then on the date of filing of the suit the agency of the plaintiff was held not terminated by the defendants. Hence the agency subsisted between the parties. The defendant has failed to show requirement of said licence to continue agency of the plaintiff in terms of Ex.P-1. The storage had to be arranged by the plaintiff as his responsibility and the supply was to be made for dealers godown as mentioned at para no. 6 of Ex.P-1. Hence the storage may be with the dealers though it may not be with the dealers. Since no notice was issued by defendant to the plaintiff for cancellation of distributorship of the plaintiff in which event it cannot be said that the defendants were empowered to cancel distributorship of the plaintiff in terms of Ex.P-1. Since the distributorship of the plaintiff was never cancelled by the defendant which defendants have failed to prove on record having not lead any evidence in this regard nor put any notice in cross-examination to witness PW-1 regarding cancellation of such distributorship and thereby no cause ever arose with the defendants to forfeit the security of the plaintiff's company in terms of letter dated 15.11.1994 which is Ex.P-32 on record. Ex.P-32 is letter issued to the plaintiff by the defendants regarding payment of dues for stationery charges or non refundable form issued and it is not related to cancellation of distributorship of the plaintiff. The defendants have stated in the said letter that the security will be forfeited and the distributorship will be cancelled by 30.11.1994, on non payment. However there is no clause or notice for automatic cancellation of distributorship. It means that there is requirement of further notice to cancel distributorship other than letter Ex.P-32. The Ex.P-32 does not detail the nature of stationery charges and non refundable form with particulars of date of supply and thereby it cannot be said that Ex.P-32 is notice at all giving complete information to the plaintiff for cancellation of distributorship. Further, as per Ex.P-1 the booking of 4 lakh connection must have been completed by Dec. 1993 and as per deposition of PW-1 that in booking connection they have complied with Ex.P-1 only. Hence no cause arose with the defendants to cancel the distributorship of the plaintiff and hence the defendants could not have cancelled such distributorship. Accordingly present issue is decided in favour of plaintiff and against the defendants.
21. ISSUE NO. 5Whether the plaintiff is entitled to any relief as claimed in the suit after rendition of accounts by the parties and if so, what is the amount due and payable to the plaintiff company by the defendant company?
21.1 The burden of proof of the present issue is on plaintiff. Under/sec. 185 of Indian Contract Act, 1872(hereinafter referred as The Act) no consideration is necessary to create an agency. Under/sec. 186 of the Act the authority of any agent may be expressed or implied. Under/sec. 197 of the Act the ratification of the act of the agent may be expressed or implied on behalf of the person for whom the acts are done. Under/sec. 203 of the Act the principal may revoke the authority given to the agent at any time before the authority has been exercised subject to Section 202 of the Act whereby the agent has himself has interest in the property of subject matter of agency then the agency cannot in the absence of express contract be terminated to prejudice of such interest. Section 202 of the Act has laid down that where there is express or implied contract that agency should be continued for any period of time then principal must make compensation to the agent for any previous revocation or renunciation of agency without sufficient cause with a reasonable notice.
21.2 The plea during the course of arguments taken by ld. Counsel for defendant is that the PW-1 is not a duly authorised person to institute a suit and therefore the filing of the suit is bad and has to be dismissed on this ground. In cross-examination of PW-1 dated 06.07.2017 PW-1 cannot recall whether the company has passed resolution dated 22.11.1994 Ex.P- 16 in its board meeting and he cannot say that why the minutes book of the resolution have not been filed. Authorisation letter dated 04.02.2017/Ex.P- 20 is filed.
21.3 Ld. Counsel for defendant has relied on following citation:
Nibro Ltd. v. National Insurance Co. Ltd.
Manu/DE/0138/1991 from Hon'ble High Court of Delhi
decided on 06.03.1990
21.4 Plaintiff has submitted that the suit was filed with due authorisation as deposed by PW-1 above. Mark H is letter to the defendant filed by PW-1. Plaintiff has already filed photocopy of the same. The said agreement is Ex.P-1 on record in original and it is admitted document. Hence, when the plaintiff PW-1 is accepted as valid signatory to the creation of agency between the parties vide Ex.P-1 then onus has shifted on the defendants to show that when the said directorship of the plaintiff has been changed. Defendants have not led any evidence in this regard and hence failed to discharge the onus. Ex.P-1 bears signature of PW-1 stamped director of the company. In such view of admitted documents between the parties it is held that suit is validly instituted by the plaintiff as Director and there is no challenge to the same from the defendant.
21.5 The creation of agency between the parties is thereby remains admitted vide Ex.P-1. The area in which the plaintiff was authorised to book regular connection is admitted. Security deposit of Rs.15 lakhs is admitted by the defendant. It is submitted by the defendant that he has supplied the booking forms to the plaintiff against which defendant has received part payment. According to the defendant plaintiff has to pay Rs.4,75,000/-. However defendant has not led any evidence in defence.
21.6 The law as laid down in citation titled Chaubey Sushil Chandra vs Raj Bahadur on 20 September, 1976 from Hon'ble Allahabad High Court AIR 1977 All 259 wherein it is held as under:
9. We would first take up the appeal No. 29 of 1957. Shri Jagdish Swarup appearing for the appellant Raj Bahadur seriously contended that the court below has committed an error of law in dismissing the suit on the ground that the suit was not maintainable. In doing so, he has not applied the correct law. The Court below mainly relied upon Mirza Najm Effindi v. Firm Kohinoor Footwear Co., AIR 1946 All 489. A learned Single Judge of this Court took a view that an agent is not ordinarily entitled to institute a suit for accounts against his principal.
His suit must be for the recovery of the specific amount alleged to be due to him from the principal. The mere fact that the accounts are complicated, would not entitle him to sue for rendition of accounts for which a principal is not legally liable, but it is open to the agent to serve interrogatories on the principal or to apply for discovery and inspection of Ms accounts. Similarly the mere fact that in ascertaining the accounts does not in any way alter the nature of a suit brought by the agent against his principal. In this case, reliance was also placed on the case of Hanuman Baksh v. Balmukund Kanhaiyalai, AIR 1927 Lab 701 and Narmada Chandra v. Maharaj Bahadur Singh, AIR 1937 Cal 359. According to Shri Jagdish Swarup, the view taken in AIR 1946 All 489 has been turned down in a later decision of this Court. He referred to the case of Lakshmiji Sugar Mills Co. v. Banwari Lal. AIR 1959 All 546, A Division Bench of this Court held:
"There is no provision for a suit for accounts by the agent against his principal either in the Contract Act or in the Limitation Act. Therefore, normally such a suit will not lie. But the existence of special circumstances will justify such a suit for accounts. For the maintainability of such a suit it should be made clear that exceptional circumstance of the agent not being able to claim a specific sum without the principal's accounts being gome into exists. If this circumstance does as exist a suit for accounts by the agent would be clearly not maintainable,"
10. In Ham Krishna Agencies (Pvt.) Ltd, v. Life Insurance Corporation, Madras, AIR 1967 Andh Pra 109 a learned Single Judge of that Court took a similar view that broadly speaking no agent can institute a suit for account against the principal who normally is not held liable for account. It is not, however, an absolute rule of law. It accepts some well recognised facts in relation to the business (which) can be within the exclusive knowledge of the principal. In such a case it is recognised that a suit for account in those special circumstances can lie against the principal.
11. Next reliance was placed on Narandas Morardas Gajiwala v. S. P. A. M. Papamal, AIR 1967 SC 333. While dealing with Section 213 of the Indian Contract Act the Supreme Court held:
"The principal's right to sue an agent for rendition of accounts is recognised by the Contract Act, inasmuch as Section 213 thereto specifically provides that an agent is bound to render proper accounts to his principal on demand. There is no such provision in the Act which enables an agent to sue his principal for accounts. The statute is not exhaustive and the right of the agent to sue the principal for accounts is an equitable right arising under special circumstances and is not a statutory right. In English law an agent has a right to have an account taken and where the accounts are of a simple nature they can be taken in an ordinary action in a Queen's Bench Division. The legal position in India is not different. Though an agent has no statutory right for an account from his principal, nevertheless, there may be special circumstances rendering it equitable that the principal should account to the agent. Such a case may arise where all the accounts are in the possession of the principal and the agent does not possess accounts to enable him to determine his claims for commission against his principal. The right of the agent may also arise in an exceptional circumstance where his remunerafion depends on the extent of dealings which are not known to him or where he cannot be aware of the extent of the amount due to him unless the accounts of his principal are gone into."
21.7 Hence in the present case the plaintiff is required to plead and show that what accounts are in possession of the defendants and for what period and which could not be available with the plaintiff failing which the plaintiff is not entitled being agent against his principal, the defendant to claim in suit for accounts. In the present suit filed by the plaintiff no such period is stated by the plaintiff for which account is sought as per the prayer clause. The plaintiff has failed to show that which of the accounts are not available with the plaintiff which must be available with the defendants. In such circumstances of the case the plaintiff has failed to bring his case under the rule of equity to claim account from the principal being an agent and thereby it is held that plaintiff is not entitled for rendition of accounts against the defendants. Accordingly present issue is decided against the plaintiff and in favour of defendant.
22. ISSUE NO. 6Whether the plaintiff is entitled for the recovery of Rs.15,00,000/- and Rs.4,50,000/- in terms of prayer (a) of the amended plaint? OPP 22.1 PW-1 has deposed in evidence by way of affidavit Ex.PW1/1 at para no. 7 in same terms of his pleadings that plaintiff company/its directors had deposited with defendants a sum of Rs.5 lakhs on 19.06.1993, another sum of Rs.5 lakhs on 24.06.1993, another sum of Rs.3 lakhs on 10.07.1993 and another sum of Rs.2 lakhs on 13.07.1993. Total amount deposited is Rs.15 lakhs as refundable interest free security in terms of agreement Ex.P-1 at para no. 10 of the agreement. The balance of amount of security for a sum of Rs.10 lakhs was to be deposited by 28.08.1993 as per clause 10 of the agreement Ex.P-1. The forfeiture clause of security is mentioned at para no. 10 of Ex.P-1 that the security will be forfeited if there is any complaint of any maltrade practice such as theft from cylinder, pilferage, selling duplicate cylinders and pressure regulators only and before the same a one month notice to explain such malpractices will be given. Hence as per agreement between the parties the security can be forfeited only as per clause 10 detailed above and not other circumstance.
22.2 Defendant had not led any evidence in defence. However the corresponding para of the written statement at para no. 7 admits deposit of security for a sum of Rs.15 lakhs as interest free security it is submitted by the defendant that plaintiff has failed to pay the balance amount of Rs.10 lakhs. Time was granted to the plaintiff on request to pay balance amount of Rs.10 lakhs but plaintiff did not pay. It is denied that plaintiff was exempted from depositing the said balance amount of Rs.10 lakhs. The plaintiff is liable to pay security deposit for a sum of Rs.10 lakhs alongwith interest which is pleaded by defendant at para no. 19 of the written statement. At para no. 21 it is pleaded by the defendant that defendant no. 1 is still ready to supply the gas to the plaintiff provided plaintiff gets storage licence from Deputy Chief Controller of Explosives, Agra and the plaintiff deposit the security alongwith interest which is so pleaded. The plaintiff has not raised any demand order for supply of LPG gas for which no supply could be made.
22.3 After hearing both the parties it is noted that the agreement Ex.P-1 has specifically laid down under para 10 that only on satisfaction of certain conditions the security deposit can be forfeited which are already detailed above at para no. 22.1 above. The defendant has failed to plead such conditions either in the pleadings or in the evidence regarding theft from cylinder, pilferage, selling duplicate cylinders and pressure regulators only and before the same a one month notice to explain such malpractices. Hence no occasion ever arose with the defendant to forfeit the security deposit of the plaintiff. The contract between the parties was already held completed in view of findings under issue no. 4 above which be also read as part of present issue for the sake of brevity. Defendant has admitted that he is ready to supply the LPG gas to the plaintiff subject to placement of order by the plaintiff with the defendant and that the defendant has licence from Controller of Explosives. Non payment of balance security of Rs.10 lakhs is not a condition precedent for such supply of LPG gas by the defendants to the plaintiff. The defendants and plaintiff hence thereby so altered the original terms of contract and effected novation of contract U/sec. 62 of Indian Contract Act, 1872. Hence on such account the defendant cannot forfeit the security deposit with him of the said amount of Rs.15 lakhs of the plaintiff.
22.4 Other than this before forfeiture of security deposit the defendant is required to show satisfaction of Section 73 of Indian Contract Act, 1872 regarding consequence of breach of contract which is applicable in the present case. In such circumstances the defendant is not only required to prove breach but also damages claimed by him to sustain forfeiture of security amount deposited by the plaintiff. It is already held above that there is novation of contract between parties and even in terms of original contract Ex.P-1 the terms of forfeiture of security amount is not satisfied in the present case. The further requirement for forfeiture of security amount U/sec. 73 of Indian Contract Act, 1872 is settled law and laid down as under in view of citation titled Sunil Sehgal v. Chandra Batra CS(OS) no. 1250/2006 from Hon'ble High Court of Delhi at para no. 31, 32, 33, 34, 43.1 and 43.6 which are reproduced as under:
31. Section 74 as it originally stood read thus:
"When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named."
32. By an amendment made in 1899, the Section was amended to read:
"74. Compensation for breach of contract where penalty stipulated for.--When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for.
Explanation.--A stipulation for increased interest from the date of default may be a stipulation by way of penalty.
Exception.--When any person enters into any bail- bond, recognizance or other instrument of the same nature, or, under the provisions of any law, or under the orders of the Central Government or of any State Government, gives any bond for the performance of any public duty or act in which the public are interested, he shall be liable, upon breach of any condition of any such instrument, to pay the whole sum mentioned therein.
Explanation.--A person who enters into a contract with Government does not necessarily thereby undertake any public duty, or promise to do an act in which the public are interested."
33. Section 74 occurs in Chapter 6 of the Indian Contract Act, 1872 which reads "Of the consequences of breach of contract". It is in fact sandwiched between Sections 73 and 75 which deal with compensation for loss or damage caused by breach of contract and compensation for damage which a party may sustain through non- fulfillment of a contract after such party rightfully rescinds such contract. It is important to note that like Sections 73 and 75, compensation is payable for breach of contract Under Section 74 only where damage or loss is caused by such breach.
34. In Fateh Chand Vs. Balkishan Dass (supra), this Court held:
"The section is clearly an attempt to eliminate the somewhat elaborate refinements made under the English common law in distinguishing between stipulations providing for payment of liquidated damages and stipulations in the nature of penalty. Under the common law a genuine pre-estimate of damages by mutual agreement is regarded as a stipulation naming liquidated damages and binding between the parties: a stipulation in a contract in terrorem is a penalty and the Court refuses to enforce it, awarding to the aggrieved party only reasonable compensation. The Indian Legislature has sought to cut across the web of rules and presumptions under the English common law, by enacting a uniform principle applicable to all stipulations naming amounts to be paid in case of breach, and stipulations by way of penalty....."
* * * Section 74 of the Indian Contract Act deals with the measure of damages in two classes of cases (i) where the contract names a sum to be paid in case of breach and (ii) where the contract contains any other stipulation by way of penalty. We are in the present case not concerned to decide whether a covenant of forfeiture of deposit for due performance of a contract falls within the first class. The measure of damages in the case of breach of a stipulation by way of penalty is by Section 74 reasonable compensation not exceeding the penalty stipulated for. In assessing damages the Court has, subject to the limit of the penalty stipulated, jurisdiction to award such compensation as it deems reasonable having regard to all the circumstances of the case. Jurisdiction of the Court to award compensation in case of breach of contract is unqualified except as to the maximum stipulated; but compensation has to be reasonable, and that imposes upon the Court duty to award compensation according to settled principles. The section undoubtedly says that the aggrieved party is entitled to receive compensation from the party who has broken the contract, whether or not actual damage or loss is proved to have been caused by the breach. Thereby it merely dispenses with proof of "actual loss or damages"; it does not justify the award of compensation when in consequence of the breach no legal injury at all has resulted, because compensation for breach of contract can be awarded to make good loss or damage which naturally arose in the usual course of things, or which the parties knew when they made the contract, to be likely to result from the breach.
* * * Section 74 declares the law as to liability upon breach of contract where compensation is by agreement of the parties pre- determined, or where there is a stipulation by way of penalty. But the application of the enactment is not restricted to cases where the aggrieved party claims relief as a Plaintiff. The section does not confer a special benefit upon any party; it merely declares the law that notwithstanding any term in the contract predetermining damages or providing for forfeiture of any property by way of penalty, the court will award to the party aggrieved only reasonable compensation not exceeding the amount named or penalty stipulated. The jurisdiction of the court is not determined by the accidental circumstance of the party in default being a Plaintiff or a Defendant in a suit. Use of the expression "to receive from the party who has broken the contract" does not predicate that the jurisdiction of the court to adjust amounts which have been paid by the party in default cannot be exercised in dealing with the claim of the party complaining of breach of contract. The court has to adjudge in every case reasonable compensation to which the Plaintiff is entitled from the Defendant on breach of the contract. Such compensation has to be ascertained having regard to the conditions existing on the date of the breach."
43.1. Where a sum is named in a contract as a liquidated amount payable by way of damages, the party complaining of a breach can receive as reasonable compensation such liquidated amount only if it is a genuine pre-estimate of damages fixed by both parties and found to be such by the Court. In other cases, where a sum is named in a contract as a liquidated amount payable by way of damages, only reasonable compensation can be awarded not exceeding the amount so stated. Similarly, in cases where the amount fixed is in the nature of penalty, only reasonable compensation can be awarded not exceeding the penalty so stated. In both cases, the liquidated amount or penalty is the upper limit beyond which the Court cannot grant reasonable compensation.
43.6. The expression "whether or not actual damage or loss is proved to have been caused thereby" means that where it is possible to prove actual damage or loss, such proof is not dispensed with. It is only in cases where damage or loss is difficult or impossible to prove that the liquidated amount named in the contract, if a genuine pre- estimate of damage or loss, can be awarded.
22.5 The defendants has not led any evidence. No genuine pre-estimate of damage is proved by defendants. The forfeiture of security is conditional which are not satisfied as discussed above. Defendants have failed to prove loss on account of which damage could be claimed to forfeit security deposit of plaintiff. In view of above the defendants have failed to show entitlement to forfeit the security amount of the plaintiff. Hence it is held that defendants are not entitled to forfeit security deposit of the plaintiff and therefore they are liable to return the said amount of Rs.15 lakhs to the plaintiff which is interest free security as per Ex.P-1. However the subject matter of interest in the present suit is decided under issue no. 7.
22.6 The plaintiff has further claimed a sum of Rs.4,50,000/- as cost of booking forms alongwith interest @ 18% p.a which is so pleaded by the plaintiff at para no. 23(c) of the plaint and para no. 26 of evidence by way of affidavit of PW-1 vide Ex.PW1/A. In the agreement between the parties Ex.P-1 at para 3 mention three different rates are mentioned for booking of forms in the nature of domestic, commercial and industrial. The 20% of the cost of form is allowed as incentive as subsidy to the distributor. Vide Ex.P- 3 to Ex.P-17 various payments are shown by the plaintiff to the defendants for different sums. Mark A is letter to the defendants by the plaintiff in reference to queries from District Food & Supplies Controller, Rohtak and objection for collecting cost of form. Ex.P-9 is letter issued by defendants dated 23.08.1993 to District Food & Supplies Controller, Rohtak regarding such objection which is admitted by the defendants. Hence the issue of collection of cost of form on 23.08.1993 is admitted between the parties. The defendants have not proved by evidence the accounts for their claim of cost of form for a sum of Rs.4.75 lakhs. Ex.P-12 is letter by plaintiff to the defendants regarding refund of cost of form to the sub-dealers in view of instruction from the authorities. The postal receipt is pasted on Ex.P-12. Ex.P-24 to Ex.P-29 is deposit receipt for further sums by the plaintiff to the defendants of various amount by cheques. Ex.P-33 is letter from Controller of Explosives to the plaintiff regarding renewal of licence and the licence upto March 1997 in Form-F is also available on record dated 19.08.1994. The search report of balance sheet of the defendant company is Ex.P-34 claiming balance against the plaintiff though the same is not proved by the defendants by evidence and denied by the plaintiff. Ex.P-20 is authorisation letter to Mr. Harish Goel dated 04.02.2017 by Director Ms. Vanita Jain to plead and prosecute the case.
22.7 In cross-examination of PW-1 it is deposed that four lakhs LPG connection had to be registered as per agreement Ex.P-1 but PW-1 does not remember of exact figure of such booking nor the approximate figure hence PW-1 cannot tell the number of forms issued and money collected from customers. It is for the plaintiff to prove first the money collected from the customers and so deposited by them with the defendant. The defendants have also claimed that the plaintiff did not return unused forms which is denied by the plaintiff. Mere denial by the plaintiff will not suffice in the circumstances of the case and burden is on the plaintiff to show that it has returned unused forms to the defendants failing which it is one of the circumstance to doubt whether plaintiff has at all booked the connections with the customers or has retained the money with him of the forms already booked. In fact the plaintiff himself has not specifically pleaded the number of forms booked and the forms returned by plaintiff to the defendant. Therefore it cannot be ascertained that how much money the plaintiff has collected form the customers amount of which allegedly paid to the defendants. As per own admitted case of the plaintiff they had refunded the amount of collection of form to the customers keeping in view the directions from District Food & Supplies Controller, Rohtak in reference to Mark Q and Mark R on record. Thereby it is for the plaintiff to specifically plead that how much money was retained by them and how much money was returned by them due to the customers. As per own admission of the plaintiff they are not entitled to the said amount and only customers are entitled to the said amount. Plaintiff through PW-1 has failed to depose regarding unused forms. On the account discussed above the pleading of the plaintiff is bad under Rule 4 of Order VI CPC and it cannot be ascertained that how much amount is due to the customers without filing of necessary account by the plaintiff of such used and unused forms and the amount collected. The amount admittedly does not belong to plaintiff. When plaintiff himself is not able to show the amount due to the customers with specific name and address of customers to whom the amount had to be returned then in such event the plaintiff is claiming an amount which is not due to the plaintiff. The plaintiff has failed to prove and failed to account the total forms received from the defendants and thereby in such event the claim of plaintiff for such forms or money cannot be held due to the plaintiff in absence of necessary pleadings and evidence. The correct amount cannot be ascertained. The awarding of vague amount will again lead to injustice. In view of the above it is held that plaintiff has failed to discharge burden of proof levied upon him for return of such due amount of cost of form as paid to the defendants and therefore plaintiff is held not entitled for recovery of sum of Rs.4,50,000 from the defendants.
22.8 Accordingly the present issue is decided in favour of plaintiff and against the defendants.
23. ISSUE NO. 7Whether the plaintiff is entitled for interest? If so at what rate and for which period? OPP 23.1 The findings under issue no. 6 above, are equally applicable under the present issue and be read as part of the present issue. The same are not repeated herein for the sake of brevity.
23.2 Plaintiff is already held entitled to recovery of only Rs.15 lakhs from the defendants which is security deposit. The security has to be refunded interest free at the time of completion of contract between the parties. According to defendant the contract was not terminated by the defendant and therefore he is not liable to pay any interest. In the present case it has to be seen that whether contract between the parties had been terminated. The plaintiff has not filed alongwith documents letter for cancellation of the contract between the parties. However on the date of filing of the suit plaintiff has claimed for refund of the security amount shows that the plaintiff has exhibited his intention of termination of contract on the date of filing of the suit. Notice of the same was given to the defendants. Hence notice of the suit to the defendant is sufficient notice of termination of contract between the parties as to principal and agent which is the law laid down under citation titled as Jeevan Diesels & Electricals Ltd vs. Jasbir Singh Chadha (HUF) & Anr. 2011 (183) DLT 712.
23.3 Hence the contract has stood terminated on the date of filing of the suit. The claim of defendant for forfeiture of security deposit has already been rejected under issue no. 6 above. As per Ex.P-1 the agreement the security was deposited interest free. Hence the defendant is not required to pay interest on the security deposit till the date of filing of the suit when the contract was subsisting between the parties. However as soon as the contract has stood terminated on the date of filing of the suit the defendant is liable to pay interest on the said amount as it is not lying with the defendants in the nature of security deposit but it is an amount due to the plaintiff independent of security deposit against the defendants. Hence the defendants are liable to pay interest. There is no contractual rate of interest between the parties. Keeping in view of Section 34 of CPC, 1908 interest @ 6% p.a. is awarded on due sum of Rs.15 lakhs on the security deposit due to the plaintiff against the defendants from the date of filing of the suit till the recovery of suit amount. Accordingly present issue is decided in favour of plaintiff and against the defendants.
24. ISSUE NO. 11Whether the suit is barred by limitation. Onus on parties.
24.1 The burden of proof of the present issue is on the defendant. It is submitted by the defendant that as per para no. 25 of plaint the cause of action has arose on 15.11.1994 and amended was made in the year 2006. The relief is barred as the amendment was made after more than 12 years which is neither explained in the plaint nor in the application.
24.2 In reply it is submitted by the plaintiff that the cause of action is of continuous nature. The amendment was allowed vide order dated 27.10.2006.
24.3 Parties heard and record perused.
24.4 Ld. Counsel for defendant has relied on following citation:
Abdul Rehman & Anr. v. Mohd. Ruldu & Ors. In Civil Appeal Nos. 7043 of 2012 from Hon'ble Supreme Court of India. 24.5 It is noted that the amendment was allowed vide order dated 27.10.2006. The plea of the defendant is that the limitation shall begin to apply as suit to be taken on the date when the amendment was allowed is rejected in view of doctrine of relation back. In citation titled Sampath Kumar v. Mamtha Shenoi AIR 2001 SC 2896 (2899) wherein it was held that the doctrine of relation back governs amendment of pleadings unless for reasons the Court excludes the applicability of the rule in a given case. The pleadings deemed to have been filed originally as such and evidence has to be appreciated in the light of the amended pleadings. The defendant has failed to show that the Court has at any time excluded application of doctrine of relation back. Hence the amendment has to be taken from the date of the filing of suit in the year 1994 and it is not the pleadings of the defendant that when the suit was filed at that time it was barred by the Law of Limitation. In such circumstances of the case it is held that defendant has failed to discharge the onus levied upon him and thereby the present issue is decided against the defendants and in favour of the plaintiff.
25. ISSUE NO. 10 AND RELIEF
10. Whether the plaintiff is entitled for the decree? OPP 25.1 In view of findings under issues above it is held that the present suit of the plaintiff is decreed for a sum of Rs.15 lakhs with interest @ 6% p.a. from the date of filing of the suit alongwith cost of the suit in favour of the plaintiff and against the defendants. Decree sheet be prepared accordingly. File be consigned to the record room.
JOGINDER Digitally signed by
JOGINDER PRAKASH
Announced in the open Court PRAKASH NAHAR
on 30th July 2018 NAHAR
Date: 2018.08.03
14:40:40 +0530
(JOGINDER PRAKASH NAHAR)
ADDL. DISTRICT JUDGE-04
CENTRAL/TIS HAZARI COURT/DELHI