Delhi District Court
Bharat Veer vs Jeffery Exports Pvt. Ltd And Others on 2 July, 2024
IN THE COURT OF SH. PARVEEN SINGH,
DISTRICT JUDGE-11, CENTRAL DISTRICT,
TIS HAZARI COURT, DELHI.
CS DJ No. 21554/2011
Bharat Veer,
S/o Sh. Mange Ram,
Proprietor of M/s Bharat Creations,
A-7, 60 Feet Road, Pul Prahladpur,
Badarpur, New Delhi-110044. ......Plaintiff.
Versus
1. Jeffery Exports Pvt. Ltd.,
S-19, Bapu Park, Kotla Mubarakpur,
New Delhi-110003.
Through its Chairman/ Managing Director/ Directors
Authorized Representatives
2. HDFC Bank,
S-4, Green Park Extn.,
New Delhi-110016.
(Formerly Centrurion Bank of Punjab Ltd.)
Through its Chairman/ Managing Directors/
Directors/ Branch Manager. ..... Defendants.
Date of Filing : 23.04.2009.
Date of Arguments : 02.07.2024.
Date of Judgment : 02.07.2024.
SUIT FOR RECOVERY OF RS.3,04,098.65
JUDGMENT
1. The present suit for recovery has been filed by the plaintiff CS No. 21554/2011 Digitally signed by No. 1 of 15 PARVEEN PARVEEN SINGH (Parveen Singh) SINGH Date:
2024.07.02 ADJ-11/Central/THC/Delhi/17.03.2023 16:53:57 +0530 against the defendants.
2. The case of the plaintiff as per plaint is, that the plaintiff is into the trade and business of high quality specialized fabric printing in the name and style of M/s Bharat Creations. During the financial year 2007-08, defendant no. 1 approached the plaintiff and placed order for doing job work of fabric printing as per given specifications/ instructions and after completion, it was ordered to be delivered at the defendant's unit at D-79, Sector-2, Noida, U.P. Pursuant to the aforesaid specifications/ instructions, plaintiff executed the said job work and supplied the ready material to defendant no. 1 against various invoices, details of which had been given in the plaint. Plaintiff did the said job work at the pre-agreed rates. However, defendant no. 1 paid only a lump sum amount of Rs.93,721/- and an amount of Rs.2,69,651/- remained to be paid. Plaintiff apprised defendant no. 1 about the outstanding amount upon which the defendant assured to make the payment of outstanding amount on 31.05.2008 at the time of delivery of last consignment of printed fabric by plaintiff. Defendant no. 1 further assured that the entire balance payment would be handed over to the transporter delivering the said goods. Therefore, plaintiff instructed the transporter to collect the outstanding amount of Rs.2,69,651/- from the defendant no. 1 at the time of delivery of consignment of printed fabric. However, the defendant no. 1 did not keep its words and handed over a demand draft bearing no. 31614 dated 3105.2008 of Rs.1,90,150/- to the transporter. On being asked, defendant no. 1 assured to pay the remaining amount and also assured that the said demand draft would be encashed on presentation. However, on being presented, the said demand draft got dishonoured with remarks "DD Lost/ Cancelled". Thereafter plaintiff Digitally signed by PARVEEN CS No. 21554/2011 PARVEEN SINGH SINGH Date:
No. 2 of 15 2024.07.02
16:54:07 +0530
(Parveen Singh)
ADJ-11/Central/THC/Delhi/17.03.2023 approached defendant no. 1 and requested to settle his accounts. Plaintiff also approached defendant no. 2 and explained his bonafide. However, the defendants did not pay any heed to the requests of the plaintiff. Hence, plaintiff issued legal notices dated 20.08.2008 and 27.08.2008 to the defendants. However, despite that defendants did not comply with them. Hence, the present suit for recovery of Rs.3,04,098.65 i.e. Rs.2,59,651/- towards balance principal amount and remaining towards interest @ 18% per annum w.e.f. 13.05.2008.
3. On being served with the summons of the settlement of issues, defendants filed their written statements.
4. Defendant no. 1 in its written statement took preliminary objections that the plaintiff had no locus standi to file the present suit; that the plaintiff had not come to the court with clean hands and that the suit was bad for non joinder of necessary parties.
5. On merits, it was admitted that the defendant had placed order for job work of fabric printing as per the given specifications/ instructions. It was denied that the plaintiff delivered the goods to the defendant to its satisfaction. It was submitted that the job work done by the plaintiff was not as per specification/ instructions and there was a dispute regarding the quality of printing. It was denied that the defendant had made a payment of lump sum amount of Rs.93,721/-. It was submitted that the amount of first two bills was cleared by making payment of Rs.93,721/- but there was quality problem in other job work. It was denied that the defendant assured the plaintiff to make good the balance deficiency very soon. It was submitted that the payments were to be made after checking/ inspection of the fabric by the quality controller but the plaintiff managed to deliver the CS No. 21554/2011 Digitally signed by PARVEEN No. 3 of 15 PARVEEN SINGH Date:
SINGH (Parveen 2024.07.02 16:54:18 +0530 Singh) ADJ-11/Central/THC/Delhi/17.03.2023 goods and took demand draft. It was further submitted that the defendant was also surprised to know how the plaintiff came into the possession of the demand draft bearing no. 31614. Rest of the averments made in the plaint were denied.
6. Defendant no. 2, in its written statement, took a preliminary objection that the suit of the plaintiff was not maintainable against the defendant no. 2 as there was no privity of contract between the plaintiff and the defendant no. 2. It was submitted that the demand draft bearing no. 31614 was issued by erstwhile bank CBOP on the instructions of defendant no. 1 and the payment was stopped as per the instructions of the defendant no. 1. It was further submitted that the suit of the plaintiff was bad for misjoinder of parties.
7. It was further submitted that the defendant no. 1 was having an OD Bank account bearing no. 13458180000051 with erstwhile Centurion Bank of Punjab. The said bank has been amalgamated with defendant no. 2. It was submitted that on the instructions of defendant no. 1, the erstwhile bank had issued a demand draft bearing no. 31614 in favour of M/s Bharat Creations. However, on 02.06.2008, defendant no.1 vide its letter had instructed to stop the payment of the said DD. Hence, defendant no. 2 stopped the payment of the said DD. On merits, all the averments made in the plaint were denied.
8. In the replication to the written statement, the contents of the written statement are denied and the contents of the plaint are reaffirmed.
9. Thereafter, vide order dated 15.09.2011, following issues were framed:-
1. Whether the plaintiff is entitled for the relief claimed for recovery CS No. 21554/2011 Digitally No. 4 of 15 signed by PARVEEN PARVEEN SINGH SINGH (Parveen Singh) Date:
ADJ-11/Central/THC/Delhi/17.03.2023 2024.07.02 16:54:29 +0530 alongwith an interest, in terms of prayer (a) & (b) of the plaint? OPP.
2. Whether the plaintiff has no locus standi to file the present suit? OPD-1
3. Whether the suit is bad for non disclosure of the material facts? OPD-1
4. Whether there is no cause of action against any of the defendants? OPD- 1&2
5. Whether the suit is bad for misjoinder of parties? OPD-1
6. Whether the suit is bad for non joinder of party as the defendant no. 2 is required to be deleted from the array of parties in terms of contentions raised in application under Order 7 Rule 11 CPC? OPD-2
7. Relief, if any.
10. Thereafter, plaintiff examined Sudhir Kumar as PW1 and the defendant no. 1 examined Sh. Deepak Bagga as DW1.
11. I have heard ld. Counsels for parties and perused the record very carefully. My issue wise findings are as under:-
ISSUE NO. 11. Whether the plaintiff is entitled for the relief claimed for recovery alongwith an interest, in terms of prayer (a) & (b) of the plaint? OPP.
12. The onus to prove this issue was upon the plaintiff. Plaintiff examined one Sudhir Kumar as PW1, who deposed that he was working as Manager of M/s Bharat Creations and was well versed with the facts of the present case. He further deposed that the plaintiff was a proprietorship concern of Sh. Bharat Veer and defendant no. 1 was a private limited company. He further deposed that in the year 2007-08, defendant no. 1 approached the plaintiff and placed an order for job work of fabric printing as per given specifications / instructions and after completion, further instructions were given by defendant to deliver the finished mater at D-79, Digitally signed CS No. 21554/2011 by PARVEEN PARVEEN SINGH No. 5 of 15 SINGH Date:
2024.07.02 16:54:49 (Parveen +0530 Singh) ADJ-11/Central/THC/Delhi/17.03.2023 Sector-2, Noida, U.P. Plaintiff, as per the instructions of defendant no. 1, duly executed the job work and delivered the finished goods to the satisfaction of defendant no. 1. Plaintiff raised following bills for the job work charges upon the defendant no. 1:
Invoice No. Dated Amount (Rs.) Exhibit
501 22.10.2007 53,975/- Ex.PW1/1
502 22.10.2007 41,717/- Ex.PW1/2
510 12.11.2007 56,773/- Ex.PW1/3
599 08.03.2008 44,361/- Ex.PW1/4
600 08.03.2008 1,767/- Ex.PW1/5
618 26.03.2008 23,067/- Ex.PW1/6
664 26.04.2008 45,036/- Ex.PW1/7
671 13.05.2008 86,682/- Ex.PW1/8
Total 3,53,372/-
13. Despite the job work being done to the satisfaction of defendant no. 1, defendant no. 1 only paid a lump sum amount of Rs.93,721/- leaving an outstanding balance of Rs.2,59,651/-. Defendant no.
1 also assured that it would make the balance payment on 31.05.2008 i.e. at the time of delivery of last consignment of the printed fabric and that the payment would be handed over the transporter who was delivering the goods. Plaintiff accordingly instructed the transporter to collect the outstanding amount of Rs.2,59,651/- from the defendant no. 1 but the defendant no. 1 did not keep his promise and only handed over a demand draft of Rs.1,90,150/- issued by defendant no. 2. On being inquired , defendant no. 1 assured to pay the balance amount and also assured that the DD was good for payment. However, the demand draft, on being presented, was dishonoured with remarks "DD Lost/ Cancelled & DD Lost". The said dishonoured demand draft (Ex.PW1/12) was received unpaid by the CS No. 21554/2011 No. 6 of 15 Digitally signed by PARVEEN PARVEEN SINGH (Parveen Singh) SINGH Date:
2024.07.02 16:55:04 ADJ-11/Central/THC/Delhi/17.03.2023 +0530 plaintiff on 10.06.2008 issued by defendant no. 2 alongwith memos (Ex.PW1/13 & Ex.PW1/14) dated 08.06.2008 issued by ICICI Bank. Finally, legal demand notices dated 20.08.2008 and 27.08.2008 were issued to the defendants. The legal notices alongwith postal receipts were exhibited as Ex.PW1/15 to Ex.PW1/20.
14. During his cross examination, he deposed that defendant no. 1 would not issue any formal purchase order and goods were supplied to defendant no. 1 against transport receipts. There was sampling done at the instructions of the defendant no. 1 company through its director Deepak Bagga. He admitted that initially, the sampling was done and then the goods/ samples were sent to the exporter/ defendant no. 1 and finally if the sample was found OK, final order was placed. Samples were not sent against any acknowledgment, however, the same were sent through courier.
He admitted that defendant no. 1 or any other customers used to visit factory of plaintiff in Jodhpur for sampling purposes. The samples, which were approved by defendant no. 1, were handed back after its approval and plaintiff did not retain/ maintain any record qua such approval. He admitted that Ex.PW1/D1 contained the sample of the order sent by the defendant and the final product sent by them (plaintiff) to the defendant. The sample was the one where "original standard" was pasted and stapled on the cloth. The final product was the one where "fabric received from Bharat Creation, colour not OK + fabric bleed" was pasted and stapled on the cloth. The difference between the sample and final product was as per the correction which had been sought by the buyer. He admitted that the sample Ex.PW1/D-2 was the one where "original" was pasted and stapled on the cloth. The final product was the one where "fabric received from Bharat CS No. 21554/2011 Digitally signed by PARVEEN No. 7 of 15 PARVEEN SINGH SINGH Date:
2024.07.02 (Parveen Singh) 16:55:16 +0530 ADJ-11/Central/THC/Delhi/17.03.2023 Creation, colour not OK fabric bleeding" was pasted and stapled on the cloth. The difference between the sample and final product was as per the correction which had been sought by the buyer. He had not received any written communication for correction in printing of fabric and volunteered, he had got the communication through phone. He denied that defendant had not given any permission to change the colour of the fabric. With regard to correction, one of the persons from defendant company came to Jodhpur and okayed the sample. The fabric after printing was checked and loaded for delivery by proprietor Bharat Veer. On being asked, whether at the time of delivery of the fabric, it was checked that fabric was as per the specification of printing or not, he answered, that it was delivered by the transporter and therefore, he was not present at the time of delivery. He denied that the delivered fabric was defective one and was not as per the specification given by the defendant no. 1. He denied that the delivered goods, checked by the quality controller, were not as per the specification of the printing order given by the defendant. He denied that plaintiff was informed about the defective printing quality. The printing cost of the fabric was Rs. 120/- to Rs.125/- per Kg. He did not have the knowledge of the cost of the fabric per Kg. He deposed that depending upon the quality, the cost of fabric sometimes could be equal to the printing and sometimes could be on higher side. He denied that the defendant suffered a heavy loss because the fabric price was much higher than the printing cost. He denied that the transporter took the draft from the security guard immediately after delivery of the goods without any checking of the fabric from the quality controller. He denied that defendant failed to deliver the shipment in time to his buyer because of defective fabric. He denied that defendant got debit Digitally signed CS No. 21554/2011 by PARVEEN PARVEEN SINGH No. 8 of 15 SINGH Date:
2024.07.02 (Parveen +0530 Singh) 16:55:26 ADJ-11/Central/THC/Delhi/17.03.2023 note from his buyer for not sending shipment on time and suffered a heavy loss.
15. During his cross examination on behalf of defendant no. 2, he denied that defendant no. 2 acted as per the bank regulations in respect of the instrument in question. He admitted that the instrument in question / demand draft was cancelled/ stopped by defendant no. 2 as per the instructions of defendant no. 1 as same had been lost/ misplaced. He did not make any complaint with HDFC Bank / defendant no. 2 after cancellation of instrument in question. However, they had intimated to their bank. He denied that no case of recovery of money was made out against defendant no. 2 as defendant no. 2 acted as per the banking norms.
16. On the other hand, defendant no. 1 examined Deepak Bagga as DW1, who deposed that he was the director of defendant no. 1 and was fully conversant with the facts of the present case. He deposed that he had placed some orders of job work and paid the bill amount as per the bill raised by the plaintiff vide invoice nos. 501 and 502 of Rs.93,721/-. He deposed that the job work done by the plaintiff was not as per the specification/ instructions and there was a dispute regarding the quality of the printing of fabric. The amount of first two bills were cleared by making payment of Rs.93,721/- but there was quality problem in other job work.
He further deposed that the defendant approached the plaintiff and updated the poor quality of the printing and the plaintiff assured the defendant to settle mutually and make good the loss being suffered by the defendant. He further deposed that the plaintiff was having the knowledge that the goods delivered was of poor quality and would not been accepted in normal course of delivery. He further deposed that the rejected fabric was still CS No. 21554/2011 Digitally signed by PARVEEN No. 9 of 15 PARVEEN SINGH SINGH Date:
(Parveen Singh) 2024.07.02 16:55:36 ADJ-11/Central/THC/Delhi/17.03.2023 +0530 lying in their store. He proved the letter written to Centurion Bank of Punjab for stopping the payment of DD as Ex.DW1/B and the copy of stock register as Ex.DW1/E and Ex.DW1/F. He further deposed that the defendant suffered a heavy loss due to not sending the shipment in time to its buyer because of the defective and rejected fabric.
17. During his cross examination, he was asked to specify the defect (on the material printed by the plaintiff) and he answered that they used to send the specification of printing to be done on the fabric. In this case, as in other cases, the plaintiff sent a sample which they did not find upto the mark as it was not matching. He further deposed that he sent his comments to the plaintiff informing him that the colour was not matching and the plaintiff assured that in the final product, the printing and the colour would be as per their specification. However, when they received the final product, the colour was not matching and was bleeding. The initial specifications were not provided in writing, however, when the sample was received then the comments alongwith their requirement and the defect therein were sent in writing. He denied that they had never given any specification to the plaintiff or that the product, which was received by them, was complete to their satisfaction. They had not filed the comments sent to the plaintiff because, they were sent to the plaintiff and were not with them. He denied that no comments regarding defects in the sample was ever sent to the plaintiff. They had asked the plaintiff to take back the goods but the plaintiff refused to do so and claimed that as per him, the fabric was as per specification. This communication had happened telephonically. He admitted that the draft of which the payment was stopped by them, was handed over to the representative of the plaintiff by Digitally signed by PARVEEN CS No. 21554/2011 PARVEEN SINGH SINGH Date:No. 10 of 15
2024.07.02 16:55:48 +0530 (Parveen Singh) ADJ-11/Central/THC/Delhi/17.03.2023 their security guards after receiving of the goods. He admitted that while asking for stopping the payment of draft, they had falsely stated to the bank that the cheque/draft in question had been misplaced or lost. He denied that that they had consumed the entire goods supplied by the plaintiff.
18. I have heard ld. Counsels for the parties and perused the record very carefully.
19. Ld. Counsel for plaintiff has contended that admittedly, the orders, payments against which was due and outstanding and has been claimed in the present suit, were placed by defendant no. 1. Admittedly, the job work was done by the plaintiff and fabric was delivered to defendant no. 1 as per the specification of defendant no. 1 and that is why, the demand draft for payment was handed over. He further contended that no defect was ever communicated in writing to the plaintiff by defendant no.1 which reflects that there was no defect in the quality and defendant no. 1 is illegally withholding the money of the plaintiff. He has further contended that, in order to deny the plaintiff his lawful dues, defendant no. 1 falsely claimed that the demand draft had been lost which again reflects the malafide intention of the defendant no. 1.
20. On the other hand, ld. Counsel for defendant no. 1 has contended that from the cross examination of PW1, it is very clear that the goods were not as per the specification. He has further contended that defendant no. 1, due to this conduct of the plaintiff, had suffered losses as because of the defects and bleeding of colour from the fabric, the party, to whom the goods were supplied, had issued a debit note for the defects and also rejected the goods. The testimony of DW1 in this regard has remained unrebutted. He has further contended that the legal notices issued by the Digitally CS No. 21554/2011 signed by PARVEEN PARVEEN No. 11 of 15 SINGH SINGH Date:
2024.07.02 (Parveen Singh) 16:55:58 +0530 ADJ-11/Central/THC/Delhi/17.03.2023 plaintiff were duly answered by defendant no. 1. Therefore, the plaintiff is not entitled to recovery of any amount.
21. I have considered the rival submissions.
22. From the facts and evidence as reproduced above, the only question which needs to be decided is, whether the goods supplied by the plaintiff were defective and as such, defendant no. 1 was not liable to make the payment of the work done by the plaintiff?
23. Primarily, this fact had been claimed by defendant no. 1 and the burden to prove this fact was upon the defendant.
24. From the cross examination of PW1, it is clear that initially before the order was placed by defendant no. 1, a sample was prepared and once the sample was approved, the rest of the goods were to be supplied as per the approved sample. Therefore, the sample was to be the standard which the goods supplied were required to meet.
25. However, from the cross examination of PW1, it is clear that the goods supplied were not as per the sample. Ex.PW1/D1 and Ex.PW1/D2 contained the samples and the final products and in both the cases, on being confronted with these samples, PW1 deposed that the difference between the sample and the final product was due to the correction which had been sought by the buyer.
26. Therefore, though the court is not an expert and cannot arrive at a conclusion whether the goods were as per the sample or not, but the admission of PW1 reflects that the final goods, which were supplied, were not as per the approved sample and thus, did not meet the standard which was required for the final products.
27. Once this fact stands established, the onus now shifts upon the CS No. 21554/2011 Digitally signed by No. 12 of 15 PARVEEN PARVEEN SINGH SINGH Date:
(Parveen Singh) 2024.07.02 16:56:10 ADJ-11/Central/THC/Delhi/17.03.2023 +0530 plaintiff to prove that the difference between the sample and final product was as per the instructions of defendant no. 1, as has been claimed by PW1.
28. PW1, during his cross examination on this issue, deposed that they had not received any written communication for correction in the fabric printing and then volunteered, that they had got the communication on phone for the same.
29. This submission, on the face of it, is not believable because there cannot be any telephonic instructions for a particular kind of change in the colour and my view is further fortified by further deposition of PW1 when he stated, that with regard to the correction, one person from the defendant company went to Jodhpur and okayed the sample.
30. Thus, PW has categorically stated that the supplied goods were as per the second sample, which was approved by the representative of the defendant. However, the said sample has not been placed on record by the plaintiff. The onus of proving that the differences between the samples and the final products, which have been proved vide Ex.PW1/D1 and Ex.PW1/D2, were as per the instructions of defendant no. 1, was on the plaintiff but I find, that by his failure to bring the second sample on record, the plaintiff has failed to discharge this onus. I accordingly find that the defendant no. 1 has successfully proved that the goods supplied by the plaintiff were defective. That being the case, plaintiff would not be entitled to recovery of the amount for the work which was not done to the satisfaction of defendant no. 1.
31. Even otherwise, DW1 had deposed that the defendant no. 1 had suffered heavy loss due to defective goods as the shipment could not be sent to its buyer within time because of the defective fabric printed by the CS No. 21554/2011 Digitally signed by No. 13 of 15 PARVEEN PARVEEN SINGH SINGH(Parveen Singh) Date:
2024.07.02 ADJ-11/Central/THC/Delhi/17.03.2023 16:56:21 +0530 plaintiff and the rejected fabric was still lying in their stock. Copy of the stock register was exhibited as Ex.DW1/E and Ex.DW1/F. The testimony of DW1, that the buyer rejected the goods, has remained unrebutted.
32. Therefore, in view of the fact that the goods supplied by the plaintiff were not as per the specification/ sample and that the plaintiff has failed to prove that the difference between the finished products and the samples was as per the instructions of the defendant, I find that the plaintiff is not entitled to recovery of any amount. This issue is accordingly decided against the plaintiff.ISSUE NO. 2
2. Whether the plaintiff has no locus standi to file the present suit? OPD-1
33. Plaintiff, being the person who had done the job work for defendant no. 1, certainly had a locus to file the present suit.
34. Even otherwise, no arguments have been advanced on this issue and no evidence has been led on this issue. This issue is accordingly decided against defendant no. 1.
ISSUE NO. 33. Whether the suit is bad for non disclosure of the material facts? OPD-1
35. The onus to prove this issue was upon the defendant no. 1. However, neither any arguments have been advanced on this issue nor any evidence has been led on this issue. This issue is accordingly decided against defendant no. 1.
ISSUES NO. 4, 5 & 64. Whether there is no cause of action against any of the defendants? OPD- 1&2
5. Whether the suit is bad for misjoinder of parties? OPD-1 CS No. 21554/2011 Digitally signed by No. 14 of 15 PARVEEN PARVEEN SINGH SINGH(Parveen Date:
Singh) 2024.07.02 16:56:33 ADJ-11/Central/THC/Delhi/17.03.2023 +0530
6. Whether the suit is bad for non joinder of party as the defendant no. 2 is required to be deleted from the array of parties in terms of contentions raised in application under Order 7 Rule 11 CPC? OPD-2
36. As far as defendant no. 1 is concerned, plaintiff had a cause to action to claim the recovery, though the plaintiff has failed to prove its case.
37. However, as far as defendant no. 2 is concerned, the plaintiff had no privity of contract with defendant no. 2. Defendant no. 2 admittedly had acted on the instructions of defendant no. 1 and stopped the payment of the demand draft, which it was bound to do as per the instructions of its client and has acted as per the banking norms. Thus, the plaintiff has no cause of action against the defendant no. 2 and the suit is bad for misjoinder of defendant no. 2 as a party. These issues are accordingly decided. RELIEF
38. In view of the above findings, the suit of the plaintiff is dismissed with cost. Decree sheet be prepared accordingly. File be consigned to record room. Digitally signed by PARVEEN PARVEEN SINGH SINGH Date:
2024.07.02 16:57:16 +0530 Announced in the open court (PARVEEN SINGH) on 02.07.2024. ADJ-11, Central District, (This judgment contains 15 pages and Tis Hazari Court, Delhi each page bears my signature.) CS No. 21554/2011 No. 15 of 15 (Parveen Singh) ADJ-11/Central/THC/Delhi/17.03.2023