Delhi District Court
M/S Hcl Learning Ltd vs Heritage Trust Of India on 30 June, 2020
Via Video Conferencing
IN THE COURT OF CIVIL JUDGE-01, SOUTH- EAST DISTRICT,
SAKET COURTS COMPLEX, SAKET, NEW DELHI
Presiding Officer: Ms. Anuradha Prasad, DJS
Suit No.939/2017
In the matter of:-
M/s HCL Learning Ltd
Through its Authorized Representative
806, Sidhartha, 96, Nehru Place,
New Delhi-110019 ........ Plaintiff
Vs
Heritage Trust of India,
Through Chairman/ Secretary,
Heritage Public School,
Heritage Nagar, Lal Gutuwa,
Ranchi, Jharkhand-835303 .......Defendant.
Date of institution of Suit :22.08.2017
Date on which Judgment was reserved :12.03.2020
Date of pronouncement of the Judgment :30.06.2020 *
**Due to Covid-19 pandemic, the matter has been adjourned thrice.
1.The Case 1.1. The plaintiff being a legally entity duly incorporated under the Companies Act, 1956 has instituted the present through its Authorized Representative Mr. Deepak Malik. The present suit was instituted under Order XXXVII CPC. The leave to defend application filed on behalf of the defendant was allowed by this court vide order dated 10.07.2019.
1.2. The plaintiff has instituted the present suit for recovery of an amount of Rs.2,66,159/-alongwith pendente-lite and future interest at the rate of 18% per annum and costs in favour of the plaintiff and against the defendants.
CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 1 / 142. Plaintiff's case 2.1. Pleaded case of the plaintiff is that the present suit against the defendant is on the basis of Digi School acceptance-cum Order entered into between the plaintiff and defendant, bank receipt, purchase order and acceptance certificate issued by the defendant towards their admitted liability. The defendant approached the plaintiff company for availing education services through HCL Digi-School E-Learning programme. Pursuant to a round of negotiations held between the plaintiff and defendant at the registered office of the plaintiff company i.e., at New Delhi. The defendant placed an order to the plaintiff company for availing HCL E-Learning programme and made an advance payment of Rs.12,900/- at the registered office of the plaintiff company.
2.2. Before making the aforesaid payment, an agreement called "Digi-School Agreement -Cum Order" (ACO) dated 27.11.2012 was executed between the plaintiff company and defendant, whereby the plaintiff company undertook to set up the HCL Digi- School E-Learning programme at the premise of defendant as per the terms and conditions of ACO. The total cost of installation of both the hardware and knowledge bank at defendant's premises was agreed at Rs.2,38,000/-. After the successful installation of the hardware and knowledge bank, satisfaction note in terms of the acceptance certificate dated 19.12.2012 was issued by the defendant. Defendant agreed to make payment in 20 equated quarterly installment (EQIs) as per the schedule over a period of 60 months of Rs.12,900/- per quarter to the plaintiff company.
2.3. It is alleged that the defendant defaulted in payment and are still CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 2 / 14 in possession of the hardware and knowledge bank of the plaintiff company. The plaintiff company terminated ACO vide its demand cum termination notice dated 08.08.2016 in accordance with termination clause of the ACO, to which defendant did not reply. As per clause 7.2 of the ACO defendant is liable to pay to the plaintiff all the unpaid EQIs alongwith interest agreed thereon at the rate of 18% per annum and the defendant shall also pay EQIs for the remaining of the installment period. It is also the terms of the agreement that plaintiff is entitled for re-possession of the said entire hardware at the cost of the defendant. The outstanding liability from the defendant as reflected in the statement of account as maintained by plaintiff company is Rs.2,66,159/-. Hence, the present suit.
3. Upon service of summons of the suit, the defendant contested the present suit of the plaintiff and filed the written statement.
4. Defendant's case 4.1. The defendant in its written statement has taken certain preliminary objection contending inter-alia that the present suit is barred by limitation, the present suit is not a validly instituted suit; no cause of action arose in favour of the plaintiff and against the defendant; this court has no territorial jurisdiction to try and entertain the present suit.
4.2. It is averred that as per clause 8.1 (a & b) of the ACO, the entire amount became payable when the defendant commits default in the payment of the amount. The plaintiff has not disclosed herein as to the amount of payment and the date of payment. The defendant had not made any payment to the plaintiff except the advance payment of Rs.12,900/- on 14.12.2012. The plaintiff claims that the cause of action accrued on 08.08.2016 when the CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 3 / 14 demand cum termination notice was issued. The notice did not give cause of action. The suit having been filed on or about 17.08.2017 is barred by limitation. The plaintiff by way of amendment has added Heritage Trust of India as a party to the suit by replacing Heritage Public School which was the original defendant on 13.07.2018 and the same was allowed by this court. Since, the amendment dates back to 13.07.2018. Therefore, the suit is barred by limitation.
4.3. This court has no territorial jurisdiction to try the suit as no part of cause of action has arisen within the jurisdiction of this court. The defendants made the advance payment of Rs.12,900/- at Ranchi. The plaintiff's representative was at Ranchi who has dealt with the entire transaction and received the payment there as the agreement was signed and executed at Ranchi. The present suit has not been filed by duly authorized person. There is no board resolution passed in favour of Sh. Shankar Singh Jina to sign and verify the pleadings and institute this suit. The delegation of power in his favour by Sh. Deepak Malik is wrong and illegal. The agreement entered into between the parties is of 27.11.2012. The alleged software and knowledge bank of HCL Digi School E- Learning Programme was to be installed in the end of December 2012 but no such software was installed by the plaintiff in the system. The defendant therefore did not make any further payment. The defendant had sent letter dated 07.01.2013 and letter dated 12.05.2013 to the plaintiff. Both the letters have been received by Sh. Ravi Bhushan NSDO representative of the plaintiff at Ranchi. The present suit is not validly instituted suit and is liable to be dismissed.
4.4. The plaintiff has no cause of action to file the suit against the CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 4 / 14 defendant as the plaintiff failed to install the software in perfect good condition despite complaints letter dated 07.01.2013 and 12.05.2013 sent by the defendant. Despite receipt of the aforesaid letters, the plaintiff failed to rectify the defect and install the software in good working condition and the defendant could not derive the benefit of imparting education to the students. The ACO was not adhered to by the plaintiff and therefore the plaintiff cannot take advantage of the said agreement. The certificate dated 19.12.2012 and signed by the defendant was when the software was installed. The functioning of the software was to be tested by the defendant only after its use. The defect occurred immediately after the installation. The liability of the defendant arose only if the software installed by the plaintiff was functioning properly and to the satisfaction of the defendants. The plaintiff failed to install the software in perfect good condition and as such there is no liability of the defendant to make any payment to the plaintiff. It is the plaintiff who has committed negligence and omission by not installing good working software and in proper condition. The defendant has not received any letter dated 08.08.2016 from the plaintiff asking for payment.
4.5. With these pleaded facts, the written statement prayed the dismissal of the suit of the plaintiff.
5. Issues 5.1. Upon completion of pleadings, the following issues were identified, vide order dated 11.09.2019.
(i) Whether the plaintiff is entitled to recovery of sum of 2,66,159/- in favour of the plaintiff and against the defendant?OPP.
(ii) Whether the plaintiff is entitled to interest if so, at what rate and for what period?OPP.
(iii) Relief
CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 5 / 14
6. Plaintiff's Evidence
6.1. To prove its case, plaintiff examined its AR Sh.Shankar Singh Jina as PW-1 and tendered his evidence by way of affidavit Ex.PW1/A and relied upon the following documents: -
(i) True Copy of Board Resolution dated 29.03.2016 and Power of Attorney (Letter of Authority) dated 06.07.2017 Ex.PW1/1 (Colly) (OSR)
(ii) Bank receipt dated.14.12.2012 Ex.PW1/2
(iii) Original copy of agreement-cum-order (ACO) dated 27.11.2012 Ex.PW1/3
(iv) Original Acceptance Certificate dated 19.12.2012 Ex.PW1/4
(v) Demand notice dated 08.08.2016 alongwith postal receipt dated16.08.2016 Ex.PW1/5 (colly)
6.2. PW1 was duly cross examined on behalf of the defendant.
6.3. Sh. Anuj Kumar was examined as PW2 who tendered his evidence by way of affidavit Ex.PW2/A and relied upon the following documents:-
(i) Copy of statement of account Ex.PW2/1
(ii) Certificate u/s 65B of IEA Ex.PW2/2 6.4. PW2 was duly cross examined on behalf of the defendant
7. Defendant's Evidence 7.1. To rebut the case of the plaintiff, defendant examined Sh. Lal Krishadwaja Nath Sahdeo as DW1 and tendered his evidence by way of affidavit Ex.DW1/A and relied upon the following documents: -
(i) Complaint letter dated 07.01.2013 Ex.DW1/1 (OSR)
(ii) Complaint letter dated 12.05.2013 Ex.DW1/2 (OSR) 7.2. DW1 was duly cross examined on behalf of plaintiff.
7.3. Sh. Prakash Kanwar was examined as DW2 and tendered his evidence by way of affidavit Ex.DW2/A. He deposed that he is working with the defendant school as a computer teacher since CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 6 / 14 2011. He further deposed that software installed was defective and the school authorities have written two letters dated 07.01.2013 and 12.05.2013 to the company at Ranchi Office. The letters were duly received by their employee, Sh. Ravi Bhushan, but the authorities did not accede to the request of the school authorities and the needful was not done. He further deposed that the school has suffered losses on account of this and because of this deficiency on the part of the plaintiff company regarding defect of software the school authorities could not pursue with the computer course.
7.4. DW2 was duly cross examined on behalf of plaintiff.
8. Final Arguments 8.1. Submissions on behalf of plaintiff.
8.1.1. It was argued on behalf of Ld counsel for plaintiff that this court has the requisite territorial jurisdiction to try and entertain the present suit as the ACO dated 21.11.2012 was executed in Delhi and the stamp paper on which the agreement was executed is also of Delhi. The present suit is well within limitation as the defendant had given various cheques which got dishonoured and the last cheque which got dishonoured was on 03.08.2016. The defendant is under a legal obligation to repay the outstanding amount as reflected in the ledger account pursuant to the agreement dated 27.11.2012 entered into between the parties. The Ld.counsel for plaintiff further argued in terms of the pleadings and the evidences led on behalf of plaintiff. Finally, it was prayed that the suit of the plaintiff be decreed in favour of the plaintiff and against the defendant.
8.2. Submissions on behalf of defendant.
8.2.1. The suit of the plaintiff is barred by limitation because pursuant to CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 7 / 14 agreement dated 29.11.2012, advance payment was made on 14.12.2012 and last payment was made on 25.07.2013. This court has no territorial jurisdiction to try and entertain the present suit as the agreement and negotiations between the parties took place in Ranchi office. There arose no cause of action against the defendant because part payment was in Ranchi, defendant works for gains at Ranchi, plaintiff's office is at Ranchi, work was executed at Ranchi, complaint at Ranchi, material was supplied and installed at Ranchi. There is no liability of the defendant to make any payment to the plaintiff as the software was not installed by the plaintiff even after so many telephonic conversation and despite receipt of complaints made to the plaintiff vide letters dated 07.01.2013 and 12.05.2012. The present suit is not a validly instituted suit as the same has not been filed by the duly authorized person. It was further argued that no issue on limitation and jurisdiction and cause of action has been framed, however, this court can frame issues at any time of the hearing. The suit is against Heritage Trust of India and all the parties are required to be impleaded as a party to the suit. Finally, it was prayed that the suit of the plaintiff be dismissed.
9. Heard the arguments advanced by the Ld. Counsel for parties and also considered the written submissions filed on behalf of defendant. This court has carefully perused the evidence on record in light of the pleadings of the parties.
10. Appreciation and findings The issues are adjudicated as under:-
10.1. Issue no.(i): -
Whether the plaintiff is entitled to recovery of sum of 2,66,159/- in favour of the plaintiff and against the CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 8 / 14 defendant?OPP.
10.1.1. The onus to prove this issue is upon the plaintiff.
10.1.2. The claim of the plaintiff rested on the premise that the defendant availed the education services through HCL Digi School E-
Learning Programme provided by the plaintiff. Defendant agreed to make payment in 20 equated quarterly installments (EQIs) as per the schedule over a period of 60 months of Rs.12,900/- per quarter to the plaintiff company. However, after availing the services, the defendant defaulted in payment and there are outstanding dues against the defendant for which the plaintiff has filed the present suit against the defendant to recover the outstanding dues from the defendant. To prove its case, the plaintiff has relied upon statement of account Ex.PW2/1 which reflects an outstanding amount of Rs. 2,19,414/. The defendant has neither denied the statement of account nor has casted a serious challenge as to the veracity of the said statement of account. The statement of account is duly supported by certificate under Section 65-B of the Indian Evidence Act Ex.PW2/2.
10.1.3. The basis of the present suit is Digi School agreement cum order (ACO) dated 27.11.2019 Ex.PW1/3 entered into between the plaintiff and the defendant. Ex.PW1/3 has not been denied by the defendant rather the claim of the defendant is that the plaintiff failed to install the software in good and perfect condition and therefore the plaintiff could not derive the benefit of imparting education to the students. The said plea of the defendant is not tenable in view of original acceptance certificate dated 19.12.2012 Ex.PW1/4 (referred to as 'installation sign off'), CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 9 / 14 wherein it is stated that the knowledge bank and the hardware installed is functioning satisfactorily at the school. Ex.PW1/4 is also supported by a check list wherein it is stated that all the work done as per school authority's satisfaction. There is no mention in the check list of any other issue in installation. Ex.PW1/4 has not been challenged by the defendant in any manner whatsoever during the course of trial, so as to doubt the veracity of Ex.PW1/4.
10.1.4. The defence of the defendant is that the software installed was not working satisfactorily and therefore the defendant made complaint to the plaintiff vide letter dated 07.01.2013 and 12.05.2013. It is alleged that despite receipt of these letters by the plaintiff, the plaintiff failed to rectify the defects. In order to prove that the aforesaid letters were communicated to the plaintiff, the defendant has relied upon the receiving in the said letters which as per the defendant is of the representative of the plaintiff. Perusal of letter dated 07.01.2013 and 12.05.2013 reflects a receiving. Since the defendant is relying upon the aforesaid letters to prove its defence and therefore, it was incumbent upon the defendant to show that these signatures were of the representatives of the plaintiff for his plea that the defects in the software was brought to the knowledge of the plaintiff. However, no evidence has been led by the defendant in this regard.
10.1.5. During the course of cross examination, the plaintiff had categorically denied the receipt of the said letters. Since, the onus was upon the plaintiff to prove that the said letters was actually received by the defendant and no evidence has been led by the defendant in this regard, therefore the aforesaid letters CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 10 / 14 remains not proved. Moreover, the said letter was issued in the letter head of the defendant which is nothing but a self serving document and the same cannot be relied upon unless it is proved that the contents of the aforesaid letter was duly communicated to the plaintiff.
10.1.6. The other plea taken by the defendant is that since the plaintiff failed to install the software in perfect good condition and therefore there is no liability of the defendant to make any payment to the plaintiff. In such a case, first and the foremost thing that the defendant ought to prove to the satisfaction of this court is the existence of actual defect in the installation of the software which led the software not to function properly. There is nothing on record to suggest that the software was not functioning properly. The defendant could have at least placed on record the internal documents of the defendant itself to show that the software was not functioning properly. In fact neither any inspection report has been placed on record nor any evidence has been led to show that there actually existed some defect in the installation of the software.
10.1.7. The only material on which the plaintiff is relying is the aforesaid letters dated 07.01.2013 and 12.05.2013 wherein it stated that the software was not installed in the system and it is not working. It is alleged that despite receipt of the aforesaid letters, plaintiff failed to rectify the defect. The mere fact that the defendant has written a letter that too which is a self serving statement to the plaintiff cannot lead this court to conclude that the software was not functioning properly. In any case the defendant had to independently prove apart from his mere saying by way of aforesaid letters or otherwise that the software was not CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 11 / 14 functioning properly, which the defendant clearly has failed to do so in the present case.
10.1.8. The defendant has not denied the agreement cum order (ACO) dated 27.11.2012 Ex.PW1/3 which is the basis of the present transaction between the plaintiff and defendant. Essentially, the defence of the defendant is that the defendant was not able to properly utilize the services of the plaintiff due to fault on the part of the plaintiff by not installing the software in a good and proper condition and hence the defendant is not liable to pay any amount to the plaintiff. Since the liability to pay the amount arose from agreement cum order (ACO) dated 27.11.2012 which has not been denied by the defendant and the defendant has not been able to establish its defence as raised in the written statement during the course of trial and therefore the defendant is liable to pay the outstanding dues to the plaintiff.
10.1.9. During the course of final arguments, the defendant has taken the plea that the present suit is barred by law of limitation and this court has no territorial jurisdiction to try and entertain the present suit as stated in the written statement filed on behalf of defendant. In the facts of the present case, both the issues of limitation and territorial jurisdiction is a mixed question of law and fact and the same can be decided only on the basis of evidence led by the parties. Record reveals that no issues in this regard has been framed during the course of proceedings. There is nothing on record to suggest that the plaintiff has ever pressed before this court that such an issue be framed. In these circumstances, if any findings on the aspect of limitation, jurisdiction is given by the court, then grave prejudice would be caused to the plaintiff as he never had an opportunity during the CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 12 / 14 course of trial to lead any evidence in support of its case that the suit is well within the territorial jurisdiction of this court and the same is not hit by law of limitation. Therefore, this court refrains from giving any findings on the aspect of limitation and jurisdiction.
10.1.10. Although the plaintiff by way of relief clause in the present suit has claimed an amount of Rs.2,66,159/-from the defendant, however the statement of account Ex.PW1/7 on the basis of which the plaintiff claims that there are outstanding dues against the defendant reflects that an amount of Rs.2,19,414/- is due to the plaintiff. The plaintiff has not categorically specified in the plaint as to how much amount was due and how much amount has already been paid by the defendant. The plaintiff has not shown as to how the plaintiff arrived at a figure of Rs.2,66,159/- which is claimed from the defendant by way of the present suit, when the amount reflected in the statement of account as outstanding dues is Rs.2,19,414/-. Therefore the plaintiff can be held entitled to only an amount of Rs.2,19,414/-.
10.1.11. In view of the foregoing reasons, the plaintiff is held entitled to an amount of Rs.2,19,414/- from the defendant.
10.1.12. This issue is decided in favour of the plaintiff and against the defendant.
10.2. Issue no. (ii):-
Whether the plaintiff is entitled to interest if so, at what rate and for what period?OPP.
10.2.1. The onus to prove this issue is upon the plaintiff.
10.2.2. Since this court has already found that the plaintiff is entitled to an amount of Rs.2,19,414/-, there is merit in the prayer for CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 13 / 14 interest. The claimed interest at the rate of 18% per annum is excessive in the facts and circumstances of the present case, the just claim of the plaintiff shall be served by grant of interest at the rate of 10% per annum from the date of filing of the suit till its realization. Since the plaint has recorded prayer only for grant of pendente-lite and future interest, no interest shall be awarded for any period prior to the institution of the suit.
10.2.3. This issue is decided in favour of the plaintiff and against the defendant.
11. Relief
11.1. In view of the aforesaid appreciation and findings, the plaintiff is held entitled to recover an amount of Rs.2,19,414/-alongwith interest at the rate of 10% per annum from the defendant from the date of filing of the present suit till its realization .
11.2. Costs of the suit is also awarded in favour of the plaintiff.
12. Decree sheet be prepared accordingly.
13. File be consigned to record room after due compliance. Digitally signed by ANURADHA ANURADHA PRASAD PRASAD Date: 2020.06.30 15:52:08 +0530 Pronounced in the open Court (Anuradha Prasad) on this 30.06.2020 Civil Judge, South East, Saket Court, New Delhi.
30.06.2020 CS No.939/17 HCL Learning Ltd Vs. Heritage Public School Page 14 / 14