Delhi District Court
M/S Scj Plastics Ltd vs M/S Vir Electricals on 16 March, 2009
IN THE COURT OF SH. KAMLESH KUMAR; AD&SJ(CENTRAL)-17,DELHI
Suit No. 560/08
M/s SCJ Plastics Ltd. ......Plaintiff
Versus
M/s Vir Electricals ....Defendant
ORDER
This order will dispose of an application under Order 37 rule 3(5) read with section 151 CPC filed by the Defendant for seeking leave to defend the suit for recovery of Rs.3,18,950/- filed against him by the Plaintiff.
2) The Plaintiff company has filed the present suit for recovery of Rs.3,18,950/- against the Defendant firm claiming that the Defendant had purchased from them raw material / master batches worth Rs.4,41,041/- on credit basis during the period 23.06.2004 to 08.02.2005 against various bills / invoices. The Defendant made part payment and a sum of Rs.2,01,294/- remained outstanding and payable to them. The Plaintiff has also claimed interest @ 24% per annum on the said outstanding amount.
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3) The Applicant / Defendant has stated that the suit is liable to be dismissed as no amount is due and payable by him. The Applicant has claimed that the Plaintiff had been supplying material / master batches to them since 2001 and the payments were made regularly in the round figure before / in advance and after the receipt of the material. The Applicant has submitted that both the parties have been maintaining open running accounts. The Applicant / Defendant has alleged that the Plaintiff supplied poor quality / defective master batches / material and complaints were received by them from their dealers. The Applicant / Defendant further alleged that they have suffered loss of goodwill and reputation.
4) The Applicant / Defendant have stated that on their request to settle the accounts, the Plaintiff deputed its two representatives in the month of March 2005 and the accounts were finally settled. The Applicant claimed that an amount of Rs.1,09,006/- was found due and payable; the defective material was valued at Rs.59000/- and the balance outstanding amount of Rs.50000/- was paid through two cheques for Rs.25000/- each. The Applicant / Defendant submitted that the bills against which the goods were supplied could not be construed as proof of nonpayment of the said -: 2 :- bills. The Applicant claimed that a number of triable issues have arisen which can not be decided unless the parties lead their respective evidence and prayed for grant of leave to defend the suit.
5) The application has been contested on behalf of the Plaintiff. In its reply, the Plaintiff claimed that the Defendant had purchased raw material / master batches worth Rs.4,41,041/- and against the supply of said material, a payment of Rs.2,01,294/- was still due and outstanding. The Plaintiff denied that any poor quality / defective material was supplied at any point of time. The Plaintiff submitted that the Defendant never raised any objection or made any complaint at the time of delivery of the material or even at the time of receipt of legal notice. The Plaintiff admitted the receipt of last two payments, made vide two cheques of Rs.25000/- each and submitted that the same were on account of part-payment towards the outstanding dues. The Plaintiff denied that it sent any of its representative for settlement of the accounts and prayed that the application be dismissed.
6) I heard ld counsel for the parties at bar and have carefully gone through the entire material on record.
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7) The law on the point of grant of leave to defend is now well settled by the several authoritative pronouncements of the Apex court. [Reliance placed on AIR 1977 SC 577; AIR 1990 SC 2218; AIR 1998 SC 2317]. The propositions laid down in these decisions are as follows:-
(a) If the Defendant satisfies the court that he has a good defence to the claim on merits, the Defendant is entitled to unconditional leave to defend.
(b) If the Defendant raises a triable issue indicating that he has a fair or bona fide or reasonable defence, although not a possibly good defence, the Defendant is entitled to unconditional leave to defend.
(c) If the Defendant discloses such facts as may be deemed sufficient to entitle him to defend, that is, if the affidavit discloses that at the trial he may be able to establish a defence to the Plaintiff's claim, the court may impose conditions at the time of granting leave to defend, the conditions being as to time of trial or mode of trial but not as to payment into court or furnishing security.
(d) If the Defendant has no defence, or if the defence is sham or illusory or practically moonshine, the Defendant is not entitled to leave to defend.
(e) If the Defendant has no defence or the defence is illusory or sham or practically moonshine, the court may show mercy to the Defendant by enabling him to try to prove a defence but at the same time protect the Plaintiff imposing the condition that the amount claimed should be paid into court or otherwise secured.-: 4 :-
8) The Applicant / Defendant has not disputed the receipt of raw material / master batches worth Rs.4,41,041/- from the Plaintiff against various bills. Admittedly, the Applicant / Defendant has made part-payments against the bills vide which the goods / material was received. The Applicant / Defendant has taken the plea that open and running accounts were maintained by the parties and that the payment has been made against all the bills.
The Applicant / Defendant has also filed its statement of account and claimed that nothing is due and payable. The statement of account filed on record by the Applicant / Defendant shows that some payments have been made in cash against the admitted bills and it is the said cash payment which has been disputed by the Plaintiff.
9) The Applicant / Defendant has admittedly not placed on record any receipt or acknowledgment by the Plaintiff in lieu of the payment made in cash. Further, the Applicant / Defendant has not placed on record any proof that any material / goods was returned to the Plaintiff. Simply because the Applicant / Defendant has shown cash payments in the statement of accounts maintained by it does not mean that such payment has been actually made to the Plaintiff, in the absence of any cash receipt or acknowledgment by -: 5 :- the Plaintiff. The plea raised by the Applicant does not inspire any confidence. In my considered view, the Applicant / Defendant has no good defence.
10) In my considered view, the Defendant's case is covered under 7(e) (discussed hereinabove) and I consider it expedient to allow the Defendant to prove its alleged defence subject to the condition that a sum of Rs.1,75,000/- is deposited in the court within 45 days of this order.
Announced in the open court (KAMLESH KUMAR)
Today i.e. on 16 March 2009 ADDL. DISTT. JUDGE
DELHI
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