Delhi District Court
Dynamic Brands Pvt. Ltd vs Plus Max Group Of Companies And Ors on 8 April, 2024
IN THE COURT OF MS SAVITA RAO, DISTRICT JUDGE
COMMERCIAL COURT-01, SOUTH ,
SAKET COURTS, DELHI
CS (Comm) No. : 13/2024
CNR No. DLST01-003281-2021
In the matter of :
Dynamic Brands Pvt. Ltd.
208-212, DDA Commercial Complex
Aurobindo Place, Hauz Khas
New Delhi - 110016
................. Plaintiff
Versus
1. Plus Max Group of Companies
16th Floor, Menara Safaun
No. 80 Jalan Ampang 50450, Malaysia
................. Defendant no.1
2. AGM Duty Free (Tengah) SDN BHD
16th Floor, Menara Safaun
No. 80 Jalan Ampang 50450,
Kuala Lumpur, Malaysia
Also At:-
North Port Distripark SDN BHD
D3, Jalang Parang, Pelabuhan Utara
PO Box 2584200
Port Klang, Salangor 42009, Malaysia
................. Defendant no. 2
3. Netseas DFS FZE
SM Office A-1, 308 D,
Ajman Free Zone
United Arab Emirates
................. Defendant no. 3
CS (Comm) No. : 13/2024 1/39
4. AGM Duty Free (Selatan) SDN BHD
16th Floor, Menara Safaun
No. 80 Jalan Ampang 50450,
Kuala Lumpur, Malaysia
................. Defendant no. 4
5. Plus Max Duty Free Pvt. Ltd.
No. 86/18, Royal Complex
Sankari Road, Seetharampalayam
Tiruchengode Namakkal
Tamil Nadu - 637209- IN
................. Defendant no. 5
Date of Institution : 22.03.2021
Date of Arguments : 23.02.2024 & 14.03.2024
Date of Judgment : 08.04.2024
JUDGMENT
1. This is suit for recovery filed by plaintiff against the defendants on the facts that plaintiff company is engaged in the business of trading, marketing, sale services and import & export. Defendant no.1 is a multi national group of companies with its presence in Malaysia, India, Singapore, Dubai, Hongkong and Africa. Defendant no. 2 is subsidiary/group company of defendant no.1 and has been impleaded being consignee as per the invoice to whom the goods were delivered. Defendant no.3 is also subsidiary and group company of defendant no.1 and the purchase order was issued by defendant no.1 through defendant no.3 which was the buyer/notified party as per the invoices. Defendant no.4 is other subsidiary/group company of defendant no.1 which allegedly had made payment of outstanding invoice to unknown party. Defendant no.5 is the representative of defendant no.1 as defendant no.1 had CS (Comm) No. : 13/2024 2/39 approached plaintiff through Sales and Marketing head of defendant no.5.
2. Defendant no.1 represented itself to be a leading travel retailer and trading company with a diverse portfolio of lifestyle and travel related businesses delivering a comprehensive range of services from Duty-Free Outlet, Duty Free Import/Export, Logistics and Warehousing. Defendant no.1 also operates an IT services vertical under the name of " Plus Max Info Tech" that provides IT Solutions to commercial customers.
3. Defendant no.1 through its representative Mr. Saurabh Bhatnagar, approached the plaintiff vide email dated 14.11.2019, indicating its interest in purchasing a container load of alcoholic beverages and requesting the plaintiff to share their stock position. Thereafter , defendant no.1 through defendant no.4 sent a purchase order bearing no. GPO-A-1000123 dated 22.11.2019 vide email of even date, for supply of material specified therein to defendant no.2, another group company of defendant no.1. Plaintiff delivered the specified goods and raised an invoice for USD 1,16,480/- which was remitted by defendant no.4 to the plaintiff's USD account maintained with Syndicate Bank, Hauz Khas, New Delhi. Plaintiff received the acknowledgment of aforesaid payment in terms of the payment slip shared vide email dated 08.05.2020 sent by defendant no.1.
4. Thereafter defendant no.1 through defendant no.3 issued another purchase order dated 11.06.2020 addressed to plaintiff's registered office which was received vide email dated 17.06.2020 sent by Mr. Ashok Kumar, an officer of defendant no.1. In response to the said purchase order, plaintiff issued all necessary documentation alongwith invoice dated 02.07.2020 from its CS (Comm) No. : 13/2024 3/39 registered office. In the said email, defendant no.1 had further requested that the Bill of Lading be changed once the consignment containing the goods had sailed from the loading port. Pursuant to such request, plaintiff sent an email dated 16.07.2020 to defendant no.1 which contained copies of Bill of Lading and the Switched Bill of Lading for confirmation, both of which were duly confirmed by defendant no.1 vide emails dated 16.07.2020 and 20.07.2020. Thereby, plaintiff merely worked as a Facilitator for defendant no.1 Group in co-ordinating with the Shipper to issue the switched Bill of Lading. Freight Guarantee Letter dated 20.07.2020 was issued by defendant no.1 on the letter head of Defendant no.2. Plaintiff upon the request of defendant no.1 to grant them the same credit period as given for the previous transaction pertaining to purchase order dated 22.11.2019, verbally agreed to extend the credit period mentioned in the invoice i.e. 30 days to 60 days. Therefore, in terms of verbal agreement, defendant no.1 was to make the payment of invoice amount within 60 days from the date of issuing the invoice i.e. by 02.09.2020.
5. Consignment pertaining to invoice was duly dispatched and delivered to its destination i.e. D3, Jalan Parang, Pelabuhan Utara, PO Box No. 258, Port Klang, Malaysia- 42009 as specified in the purchase order on 27.07.2020 where the consignee i.e. defendant no.2 took delivery on 07.08.2020. Same was intimated to the plaintiff by defendant no.1 vide emails dated 28.07.2020 and 07.08.2020. On 18.08.2020, employee of plaintiff contacted defendant no.1 to check upon the status of disbursement of the invoice amount and to the plaintiff's utter shock, representative of defendant no.1 stated that defendant no.1 CS (Comm) No. : 13/2024 4/39 had already remitted the outstanding invoice amount on 13.08.2020. It was made clear to representatives of defendant no.1 that no payment was received against the invoice.
6. On the same date, representative of Defendant no.1 shared a trail of emails sent and received between 04.08.2020 to 13.08.2020, perusal of which made it clear that defendant no.1 had allegedly been a victim of cyber fraud committed upon them by unknown persons owing to its own negligence. However, the denial on part of defendants in providing the bank statement, corroborating their representation that the payment has been made, even after repeated requests of plaintiffs for the same, leads to suspicion that no payment was made by defendant no.1 who may have weaved this entire narrative to evade their legal obligation to pay the invoice amount. Plaintiff duly notified defendant no.1 that it had been the victim of fraud on 18.08.2020 itself, pursuant to which, defendant no.1 through defendant no.4 intimated their bank 'Public Bank Berhad' vide letter dated 18.08.2020 and also registered a police complaint in Malaysia on 20.08.2020. On 07.09.2020, plaintiff contacted defendant no.1 for payment of outstanding invoice amount and plaintiff was assured that it was entitled to receive the payment. However, defendant no.1 vide email dated 08.09.2020 revealed its malafide intent of not paying the plaintiff for the goods supplied, by weaving a false narrative that it was the plaintiff who was the victim of cyber fraud, whereas in fact, it was defendant no.1 who was the victim of alleged fraud owing to its own negligence.
7. Thereafter despite sending emails dated 10.09.2020 and 25.09.2020 by plaintiff to defendant no.1 clarifying, no fault on the part of plaintiff and demanding its outstanding dues, conduct CS (Comm) No. : 13/2024 5/39 of defendant no.1 has been evasive. Legal notice dated 23.08.2020 sent by plaintiff, though was replied by defendants but the payment of outstanding amount was not made, constraining the plaintiff to file the present suit against defendants seeking decree in sum of USD 1,24,956 (invoice amount) alongwith interest amount of USD 1383 @ 2% per annum from 02.09.2020 till the date of payment or Rupee equivalent of USD 1,26,339 at the rate of exchange prevailing on the date of order.
8. Pre-Institution Mediation proceedings were not resorted to by the plaintiff and it was stated that since plaintiff has filed application under Order 39 Rules 1, 2, 7 and 10 of CPC seeking urgent interim reliefs, it may be granted permission to institute the present suit without going through Pre-Institution Mediation Proceedings.
9. In written statement filed on behalf of defendants, status of defendant no. 1 to 5 as mentioned by plaintiff was stated to be manipulated/partly manipulated averments and denied by defendants. At the same time, in subsequent paragraphs, it was submitted that defendant no.3 is the purchaser, defendant no.2 is the consignee, defendant no.4 had made the payment to the plaintiff. It was further submitted that defendants no. 1 & 5 have nothing to do with the present case or transaction and they have been unnecessary added as parties to this case. It was further submitted that Mr. Ashok Kumar is the Sales Coordinator & Purchase Manager of M/s Plus Max Way Sdn. Bhd. He is not an officer of defendant no.1 as falsely alleged by the plaintiff.
10. It was further stated that defendant no.3 had placed order for purchase of alcoholic beverages vide purchase order dated CS (Comm) No. : 13/2024 6/39 11.06.2020 for sum of USD 1,24,950/- and to deliver the alcoholic beverages to one of the defendant's associate company i.e. defendant no.2. Plaintiff received the said purchase order and agreed to supply. Accordingly, plaintiff raised an invoice dated 02.07.2020 for sum of USD 1,24,806/- in favour of defendant no.3. Thereafter plaintiff issued an amended invoice in favour of defendant no.3 and supplied the goods. Suddenly on 04.08.2020, defendants received an email with an attached letter from plaintiff's email address, through which plaintiff had been communicating to the defendants all along. In the said email, plaintiff had given the mandate to plaintiff's affiliated company Nippon Tinplate (Asia) Ltd. at Hongkong to receive payments on behalf of plaintiff due to tax reasons. In the abovesaid email, plaintiff had also sent final amended invoice dated 02.07.2020 for sum of USD 1,24,806/- in favour of defendant no.3. In the final amended invoice issued by plaintiff, plaintiff had mentioned that they were trading as Nippon Tinplate (Asia) Ltd. Further in the said final invoice, plaintiff had changed the bank details by changing the company's name as Nippon Tinplate (Asia) Ltd. And the bank name as HSBC, Hongkong and had insisted defendant no.4 to remit the payment as per the abovesaid last amended invoice and the email. Plaintiff directed the defendants to pay the current and future invoices to the plaintiff's affiliated company mentioned above. Accordingly, on 13.08.2020, defendant made the payment in sum of USD 1,24,806/- towards 3rd final amended invoice dated 02.07.2020 issued by plaintiff.
11. It was further stated that the payments were originally made to Dynamic Brands Pvt. Ltd. and subsequently made to Nippon Tinplate (Asia) Ltd. as per the plaintiff's instructions and CS (Comm) No. : 13/2024 7/39 defendants have sufficient proof for the same. Therefore, there are no dues payable by the defendants to the plaintiff and all accounts between the plaintiff and defendants had settled fully and finally .
12. In replication, contents of written statement were denied and those of plaint were reiterated and reaffirmed.
13. Following issues were framed vide order dated 22.11.2022 :
(1) Whether this court lacks the territorial jurisdiction to try the present suit? OPD (2) Whether the suit is bad for mis-joinder and non-
joinder of parties ? OPD (3) Whether the plaintiff is entitled for recovery of the suit amount? If yes, from whom/which of the defendants?
OPD
(4) Whether the plaintiff is entitled to the interest? If so, at
what rate and for which period? OPP
(5) Relief
14. Plaintiff in support of its case, examined Sh. Rajesh Mohindra, AR/Chief Executive Office of plaintiff company as PW1 who filed his evidence by way of affidavit Ex. PW1/X and relied upon following documents:-
1. Copy of invoice bearing No. DB/2021/006 dated 02.07.2020 is Ex. P-1.
2. Copy of Purchase Order dated 17.06.2020 is Ex. P-2.
3. Remittance Application Form is Ex. P-3.
4. Copy of letter dated 18.08.2020 is Ex. P-4.
5. Copy of Police Complaint in Malaysia dated 20.08.2020 is Ex. P-5.
6. Legal notice dated 23.08.2020 is Ex. P-6.CS (Comm) No. : 13/2024 8/39
7. Reply dated 10.11.2020 is Ex. P-7.
8. Board Resolution dated 29.01.2021 is Ex. PW1/1.
9. Copy of email dated 14.11.2019 is Ex. PW1/2.
10. Copies of email dated 17.06.2020, 16.07.2020 and 20.07.2020 is Ex. PW1/3.
11. Copy of Freight Guarantee Letter Dated 20.07.2020 is Ex. PW1/4.
12. Copies of email dated 28.07.2020 and 07.08.2020 is Ex. PW1/5.
13. Copies of email trail is Ex. PW1/6.
14. Forged Authorization Letter dated 04.08.2020 is Ex. PW1/7.
15. Forged Invoice is Ex. PW1/8.
16. Email dated 07.09.2020 and 08.09.2020 is Ex. PW1/9.
17.Email dated 10.09.2020 and 25.09.2020 is Ex. PW1/10.
18. Copy of order in Bail Application no. 114/2019 dated 04.02.2019 is Ex. PW1/11.
19. Screenshot of defendant no.1's website is Ex. PW1/12.
15. Sh. Bhuvenesh Kapoor, an IT and Cyber Security Professional, working as Technical Head (Director) at Star IT Solutions was examined as PW2, who relied upon the report dated 04.01.2023 issued by him to the plaintiff and exhibited the same as Ex. PW2/A.
16. In Defence, Sh. Saurabh Bhatnagar, Head Sales and Marketing of Defendant no.5 Company/AR of defendants, was examined as DW1 who filed his evidence by way of affidavit Ex. DW1/X and relied upon following documents:
1. Copy of email communication between plaintiff and defendants from 13.11.2019 to 27.01.2020 is Ex. D-1.CS (Comm) No. : 13/2024 9/39
2. E-mail communication with regard to pages 89-90 of documents filed by defendant are Ex. D-2.
3. Original Authorization Letter and Board Resolution dated 30.06.2021 is Ex. DW1/1 (colly)
4. Copy of email communication between plaintiff and defendants 28.01.2020 to 08.05.2020 is Ex. DW1/3 (colly).
5. Certified true copy of Bank Challan of Public Bank BRHAD is Ex. DW1/4.
6. Certified true copy of Bank Statement of Public Bank dated 31.08.2020 BRHAD is Ex. DW1/5.
17. Sh. M. Ashok Kumar, Purchase Assistant of Defendants Company/AR of defendants was examined as DW2 who filed his evidence by way of affidavit Ex. DW2/X and relied upon emails dated 13.11.2019 to 08.05.2020 already exhibited as Ex. DW1/2 and Ex. DW1/3 as well as upon letters dated 04.08.2020 and 12.08.2020 already exhibited as Ex. PW1/7 and Ex. PW1/8.
18. Sh. Gandla Jayasuryapal, Cyber-Security Analyst in Vatins Systems Private Limited was examined as DW3 who filed his evidence by way of affidavit Ex. DW3/X and relied upon following documents:
1. Authority Letter Dated 04.10.2023 is Ex. DW3/1.
2. Original Report dated 29.08.2020 is Ex. DW3/2.
3.Copy of Meta Data of email dated 04.08.2020 and subsequent emails is Ex. DW3/4.
4.Copy of screenshot of header dated 04.08.2020 is Ex. DW3/5.
5. Certificate u/s 65B of Indian Evidence Act is Ex. DW3/6.CS (Comm) No. : 13/2024 10/39
Issue wise findings are as under :-
Issue no.1 :
19. It was submitted by Ld. counsel for defendant that this court has no territorial jurisdiction to try the present suit as no cause of action ever arose within the territorial jurisdiction of this court. The purchase order was placed through email and every communication was done through email which was admitted by PW1 in his cross examination. The entire cause of action for this transaction had taken place at Malaysia, therefore, jurisdiction lies at Malaysia. It was denied that there was any agreement between parties with regard to the territorial jurisdiction. As submitted, merely because it is mentioned in the invoice that the territorial jurisdiction shall be at 'Delhi' will not become an agreement, when admittedly there is no contract or agreement where both parties have expressly agreed upon the jurisdiction.
20. As further stated, it is totally false to claim that plaintiff had received the purchase order, communications, emails at the registered office at Delhi. The whole communications inlcuding exchange of documents took place through email and there was no physical delivery to Delhi office of the plaintiff. Therefore, in terms of section 20 of CPC, suit is not maintainable before this court and is liable to be dismissed as no cause of action arose within the jurisdiction of this court. For the abovesaid reliance was placed upon Inter Globe Aviation Ltd. Vs. N. Satchidanand (2011)7 SCC 463, wherein while referring to A.B.C. Laminart Pvt. Ltd. and Another Vs. A.P. Agencies, Salem, it was observed that :
" 14....... any clause which outsts the jurisdiction of all courts having jurisdiction and conferring jurisdiction on a court not otherwise having jurisdiction would be invalid. It is now well settled that the parties cannot by CS (Comm) No. : 13/2024 11/39 agreement confer jurisdiction on a court which does not have jurisdiction and that only where two or more courts have the jurisdiction to try a suit or proceeding, an agreement that the disputes shall be tried in one of such courts, is not contrary to public policy. The ourster of jurisdiction of some courts is permissible so long as the court on which exclusive jurisdiction is conferred, had jurisdictiion . If the clause had been made to apply only where a part of cause of action accrued in Delhi, it would have been valid. But if the clause provides that irrespective of the place of cause of action, only courts at Delhi would have jurisdiction, the said clause is invalid in law, having regard to the principle laid down in A.B.C. Laminart Pvt. Ltd. and Another Vs. A.P. Agencies, Salem.
21. Per contra, Ld. Counsel for plaintiff placed reliance upon following authorities:
1. New Monga Transport Company Vs. United India Insurance Co. Ltd. And Ors. MANU/SC/0398/2004:
"14. By a long series of decisions it has been held that where two courts or more have jurisdiction under CPC to try a suit or proceeding, an agreement between the parties that the dispute between them shall be tried in any one of such courts is not contrary to public policy and in no way contravenes section 28 of the Indian Contract Act, 1872. Therefore, if on the facts of a given case, more than one court has jurisdiction , parties by their consent may limit the jurisdiction to one of the two courts. But by an agreement, parties cannot confer jurisdiction on a court which otherwise does not have jurisdiction to deal with a matter". .......
" The intention of the parties can be culled out from the use of the expressins 'only', 'alone', 'exclusive', and the like with reference to a particular court. But the intention to exclude a court's jurisdiction should be reflected in clear, unambigious, explicit and specific terms".
2. Pramod Gupta Vs. M/s Romesh Power Products Pvt. Ltd. & Anr. CS (OS) 243 of 2010 :
" It is well settled that in a suit for price of goods sold and delivered, which, in effect, is also a suit for breach of contract on the part of the defendant, the cause of action within the meaning of section 20 (c) of the Code of Civil Procedure arises at the following places:-
(i) The place where the contract was made;
(ii) The place where the contract was to be performed which in such a contract would mean the place where the goods were delivered to the purchaser;
(iii) The place where money in performance of the contract was payable, expressly or impliedly".
22. Ld. Counsel for plaintiff further referred to Lohman Rausher Gmbh Vs. Medisphere Marketing Pvt. Ltd. ILR CS (Comm) No. : 13/2024 12/39 (2005) I Delhi 38 to make the submission that where invoice raised pertains to sale of goods and contains a description of goods, quantity and price, alongwith conditions of payment and delivery address, the invoice is a complete contract, required by law.
23. Invoice Ex. P-1 is admitted document on record which contains the exclusive jurisdiction clause that disputes if any, are subject to 'Delhi' jurisdiction only. It was submitted by Ld. counsel for plaintiff that invoice Ex. P-1 contains clear description of goods, quantity of goods, price of goods and conditions of payment and the delivery address. While the invoice Ex. P-1 was issued to the defendants over 30 days prior to them taking the delivery of the goods, defendants never objected to the terms and conditons mentioned in the invoice and went on to take delivery of the goods . On the strength of above, it was submitted by Ld. Counsel for plaintiff that it leads to the irresistible conclusion that this court has exclusive jurisdiction to try the present suit.
24. Though it is correct that invoice Ex. P-1 is admitted document which contains the mention with regard to exclusive jurisdiction . However, unilateral mention in the invoice does not render exclusive jurisdiction upon the court. As per the settled law, parties can with express stipulation agree to confer the jurisdiction upon the particular jurisdiction amongst the jurisdictions where the cause of action exists, however cannot confer the jurisdiction upon the court in whose jurisdiction, the cause of action does not exist. Besides that, if no cause of action had arisen within the jurisdiction of Delhi then even with the consent of the parties, the jurisdiction cannot be conferred. In the CS (Comm) No. : 13/2024 13/39 instant matter, purchase order was placed upon the plaintiff through email which was received and read by plaintiff at the address of its registered office in Delhi. Plaintiff had furnished bank account details to the defendant for payment against the supply which was located at Hauz Khas, Delhi, falling within the territorial jurisdiction of this court. It is also settled law that the debtor has to seek creditor and where no place of payment has been agreed upon, payment would be made to creditor/seller at its place of working.
25. Reliance is placed upon following :
1. Satyapal Vs. Slick Auto Accessories Pvt. Ltd. and Ors.:
" It is settled law that the debtor has to seek the creditor and since no place of payment was agreed upon, payment would have been made to the seller who is residing and working for gain at Delhi.....It was upon the defendant no.1 to fix the place of payment which has not been done, therefore, payment would have been made by the debtor to the creditor at the place of the creditor/plaintiff ".
2. Arcelormittal India Pvt Ltd vs JSC OGCC Kazstroy Service, decided on 30 May, 2023, CS(COMM) 592/2022 & I.A. 17546/2022, I.A. 17547/2022:
" (7).......In State of Punjab v. A.K. Raha (Engineers) Ltd. AIR 1964 Cal 418, it was observed:"WHERE no place of payment is specified in the contract either expressly or impliedly, the debtor must seek the creditor; the obligation to pay the debt involves the obligation to find the creditor and to pay him at the place where he is when the money is payable.
(8) The position of law could not have been stated more categorically than it was done in S.P. Consolidated Engineering Co. (P) Ltd.
v. Union of India, AIR 1966 Cal259. The learned Judge said: "The English Common Law Rule that „a debtor must seek the creditor is universal in its application, since it is founded on justice and equity. It is surely not a technical rule of English law, wrongly made applicable to India. It is a beneficent rule, inflexible and is of universal application. The rule cannot be said to be nothing more than a presumption rebuttable by contrary evidence. When there is evidence to indicate the place where the parties to a contract intended that the debt was payable, then the court will hold that such place of payment has been indicated in the contract itself, though not expressly but by implication. The occasion for applying the rule, as a rule of justice, equity and good conscience, would arise only when the court finds that no CS (Comm) No. : 13/2024 14/39 place of payment is expressly stated in the contract nor is it possible to find such place of payment indicated in the contract by necessary implication, on the relevant evidence on record.
(9) Following Bharumal v. Sekhawatmal, AIR 1956 Bom 111, it was held in Shoba singh and Sons v. Saurashtra Iron Foundry and Steel Works (Pvt.) Ltd., AIR 1968 Guj 276, that the common law rule that the debtor should find the creditor and pay the debts where the creditor resides, applied in India in fit cases."
26. In the instant matter, case of plaintiff is rather at better footing since place of payment had been specified which was within territorial jurisdiction of this court. Having discussed as above, since part of the cause of action had arisen within the jurisdiction of this court, this court has territorial jurisdiction to try the present case. This issue is accordingly answered in favour of plaintiff.
Issue no. 2:
27. As submitted by Ld. Counsel for plaintiff, plaintiff was dealing with defendant no.1 group and defendants no. 2 to 5 formed part of defendant no.1 group, therefore, defendants,as stated are jointly and severally liable to pay the invoice amount to the plaintiff.
28. Per contra, on behalf of defendants, it was submitted that defendant no.1 is not a juristic person, therefore non juristic person cannot be sued, whereas Defendant no.5 is separate legal entity and plaintiff had not done any transaction with Defendant no.5, therefore, defendant no.5 is also not necessary party and the suit is liable to be dismissed for mis-joinder of Defendant no.1 and 5.
29. In the written statement, though initially all the averments of the plaintiff were denied, however, later on, it was mentioned that all the defendants no. 1 to 5 had nothing to do with this present case or transactions who have been added as unnecessary CS (Comm) No. : 13/2024 15/39 parties to the case, which amounts to clear mis-joinder of parties. It was submitted that defendant no.1 is not a separate legal entity which is only a corporate identity and defendants no.2 to 4 are not subsidiary of first defendant. At the same time, it was also mentioned that defendant no.3 is the purchaser, defendant no.2 is the consignee and defendant no.4 had made the payment to the plaintiff. All the defendants had authorized Mr. Saurabh Bhatnaga, Designated as Head Sales and Marketing of fifth defendant, who had knowledge about all the business transactions with the plaintiff on behalf of all the defendants. Defendants 1, 2 and 4 are located in Malaysia, defendant no.3 is located in UAE, whereas defendant no.5 is located in India.
30. Ld. Counsel for plaintiff referred to Evidence Affidavit of DW1 wherein also, it was deposed that for the Impugned Transaction, Defendant No. 3 was the purchaser, Defendant No. 2 was the Consignee and Defendant No. 4 allegedly made the payment for the goods to an unknown third party on the alleged instructions of the Plaintiff. DW1 in Cross-Examination admitted that he had signed off emails to the Plaintiff pertaining to the present transaction as "Head of Sales & Marketing Plus Max Group of Companies", i.e. the Head of Sales & Marketing of Defendant No. 1 and also that he was communicating with the Plaintiff in the capacity of Head of Sales & Marketing of Defendant No. 5. Relevant extract from cross examination of DW1 is as follows:
"...It is correct that I have entered into communications with the plaintiff in respect of the present transaction, (Vol. I have done some communications as the Liasoning was being conducted by one Sh. Ashok Kumar who is one CS (Comm) No. : 13/2024 16/39 of the team members). It is correct that I was using the email ID [email protected]. I was communicating with the plaintiff in capacity of Head of Sales & Marketing of Defendant No. 5. I can confirm that the email ID mentioned at internal page 5 of Ex. D1 (Colly page no. 54 of the document) is the correct email ID used by me at the relevant time. It is correct that email mentioned below the said line which was sent on 15.11.2019 at 17:53 Hrs was sent by me to the Plaintiff company. It is correct that while signing of the said emails I have mentioned as "Head Sales & Marketing of Plus Max Group of Companies"."
31. Further, Authorization Letters and Board Resolution of Defendant Nos. 2 to 5 Ex. DW1/1 refer to authorization on the letter head bearing the logo of the Defendant No. 1 Group. Ld. Counsel for plaintiff also submitted that Authorization Letter and Board Resolution not only authorize Mr Saurabh Bhatnagar to appear on their behalf, but also to appear on behalf of the Defendant No. 1 Group; and Defendant Nos. 2 to 5 have all mentioned in their respective Authorization Letters and Board Resolutions about Mr. Saurabh Bhatnagar, designated as Head Sales & Marketing in each of the Defendant Companies. Defendants are carrying on business under an assumed name, i.e. 'Plus Max Group of Companies' and represented to the Plaintiff and the world at large that there is an entity by the name and style of 'Plus Max Group of Companies' and the Defendants entered into the contract with the Plaintiff as a group of companies, i.e. Defendant No. 1. Therefore, in terms of settled law, Defendant CS (Comm) No. : 13/2024 17/39 No. 1 is a proper party and can be sued in its name even if it is not a juristic person. By virtue of conduct, acknowledgement and admission, privity has been created between the Plaintiff and the Defendant No. 5 as well. It does not lie to the mouth of the Defendants to contend that the Defendant No. 5 is a stranger to the contract in question.
32. Ld. Counsel for plaintiff relied upon following authorities:
1. Ram Babu Gupta Vs. M/s Aditya Birla Group & Anr.
CS (OS) 632 of 2013 decided by Hon'ble High Court of Delhi on 31.03.2014 wherein defendants sent emails which in their body referred to " Aditya Birla Group" , the offer letter was issued on the letter head of " Aditya Birla Group", offer letter mentioned that plaintiff was to be appointed with a subsidiary of Aditya Birla Group. It was accordingly observed that:
" these facts show that defendants are carrying on business under an assumed name i.e. Aditya Birla Group and are representing to people that there is an entity by the name and style of Aditya Birla Group. Such an entity can be sued in the assumed name even if it is not a juristic person".
2. Utair Aviation Vs. Jagson Airlines Limited & Anr. 2012 (129) DRJ 630:
" any case where one party is made aware about the relationship of the other party with that of a stranger and the said party proceeds to contract out only with other party in question, knowing fully well the participation and role of the said stranger, further it corresponds with the said third party/stranger, conduct suggests kind of relationship, then there can be said to be a nexus or a privity which can be said to have been created by virtue of conduct. The said question essentially becomes a question of fact and basing upon the aid fact finding, the law to be necessarily applied as to whether the said person is a complete stranger to a contract or whether the privity can be said to have been created by way of conduct ".
33. The communication between the parties reveals the communication sent on behalf of Plus Max Group of Companies which is defendant no.1 and defendant no.5 through its Head and CS (Comm) No. : 13/2024 18/39 Sales Manager in communication between plaintiff pertaining to the transaction between the parties. Defendant no.5 through its Head and Sales Manager is the one representing case of all the defendants before the court who had knowledge of business transactions between the parties, besides the participation of defendant no.5 through and as "Head Sales & Marketing of Plus Max Group of Companies".
34. Considering as above, suit cannot be termed as suffering from mis-joinder of any of the parties. This issue is answered in favour of plaintiff and against defendants.
Issue no. 3 :
35. Undisputed facts on record are that Defendant no.1 through defendant no.4 sent a purchase order bearing no. GPO- A-1000123 dated 22.11.2019 for supply of material specified therein to defendant no.2. Delivery against the said purchase order was made and payment was also remitted by defendant no.4 to the plaintiff's USD account maintained with Syndicate Bank, Hauz Khas, New Delhi. Thereafter another purchase order dated 11.06.2020 was issued, in response to which, invoice dated 02.07.2020 Ex. P-1 was issued by plaintiff and consignment pertaining to said invoice was duly dispatched and delivered to its destination, as specified in the purchase order on 27.07.2020, where the consignee i.e. defendant no.2 took delivery on 07.08.2020. Payment against previous supply was duly made by the defendants. However, payment against Ex. P-1 , as stated by plaintiff, had not been made .
36. It is contention of the defendant that the payment against the invoice Ex. P-1 was also duly made by them on 13.08.2020. As stated, plaintiff after raising of invoice dated 02.07.2020 in CS (Comm) No. : 13/2024 19/39 sum of USD 1,24,806/- had issued an amended invoice in favour of defendant no.3 and had supplied the goods. On 04.08.2020, defendants received an email with an attached letter from plaintiff's email address, through which plaintiff had been communicating to the defendants all along. In the said email, plaintiff had given the mandate to plaintiff's affiliated company Nippon Tinplate (Asia) Ltd. at Hongkong to receive payments on behalf of plaintiff due to tax reasons. In the abovesaid email, plaintiff had also sent final amended invoice dated 02.07.2020 for sum of USD 1,24,806/- in favour of defendant no.3. In the final amended invoice issued by plaintiff, plaintiff had mentioned that they were trading as Nippon Tinplate (Asia) Ltd. Further in the said final invoice, plaintiff had changed the bank details by changing the company's name as Nippon Tinplate (Asia) Ltd. and the bank name as HSBC, Hongkong and had insisted defendant no.4 to remit the payment as per the abovesaid last amended invoice and the email. Plaintiff had directed the defendants to pay the current and future invoices to the plaintiff's affiliated company mentioned above. Accordingly, on 13.08.2020, defendants made the payment in sum of USD 1,24,806/- towards 3rd final amended invoice dated 02.07.2020 issued by plaintiff. Payments were originally made to Dynamic Brands Pvt. Ltd. and subsequently made to Nippon Tinplate (Asia) Ltd. as per the plaintiff's instructions and therefore, no dues are payable by the defendants to the plaintiff and all accounts between the plaintiff and defendants stood settled.
37. Plaintiff disputed the abovesaid. As submitted, from the perusal of trail of emails sent and received between 04.08.2020 to 13.08.2020 by defendant no.1, it is clear that defendant no.1 CS (Comm) No. : 13/2024 20/39 had been a victim of cyber fraud committed upon them by unknown persons owing to its own negligence, which was duly notified by plaintiff to defendant no.1 on 18.08.2020. Upon intimation by plaintiff, defendant no.1 through defendant no.4 intimated their bank 'Public Bank Berhad' vide letter dated 18.08.2020 and also registered a police complaint in Malaysia on 20.08.2020. Thereafter, the payment of outstanding invoice amount was not made by defendants and rather a false story was weaved by the defendants that it was the plaintiff who was the victim of cyber fraud, whereas in fact, it was defendant no.1 who was the victim of alleged fraud owing to its own negligence.
38. Admitted fact on record is that the material had been supplied to defendants, defendants made payment, however plaintiff has not received the payment against the material supplied. Both the parties are claiming the other party to be victim of fraud, therefore, plaintiff is claiming for its entitlement for receipt of the payment as it has not received the payment of outstanding amount due from defendants, whereas defendant is claiming that the payment against invoice in question was duly made vide transaction dated 13.08.2020, as per the instructions received from plaintiff vide email dated 04.08.2020 and it is the plaintiff who was the victim of Cyber Fraud. So the controversy has narrowed down to the aspect as to who is the victim of fraud and whether plaintiff is entitled to the payment, despite defendant having already made payment.
39. Vide email dated 18.8.2020, plaintiff contacted defendant no.1 to check upon the status of disbursement of invoice amount since supply of goods was complete on 7.8.2020. Plaintiff was informed that defendant no.1 had already remitted the CS (Comm) No. : 13/2024 21/39 outstanding invoice amount on 13.8.2020. Defendant no.1 was informed that no payment was received against the said invoice, upon which defendant no.1 shared email trails with the plaintiff on 18.8.2020 Ex. PW1/6 which contained record of email correspondence between defendant no. 1 and of the email addresses, being [email protected], [email protected] and [email protected]. PW1 stated that these email addresses did not belong to and were not operated by plaintiff or its employees and when defendants were communicating with the said emails, they were not communicating with the plaintiff or its employees.
40. PW1 deposed that at first instance, it could be seen that on 4.8.2020 (8:30), defendant no.1 had received an email which was sent by unknown persons to defendant no.1 wherein those unknown persons requested information regarding the impugned transaction from defendant no.1 in order to provide a letter of authorization and ' nominated bank detail for payment' on the ground that plaintiff's " regular bank account has been hit again with high tax imposition for all international receivable funds". As per the records of plaintiff, email dated 04.08.2020 (8:30) was not sent by the plaintiff or its employees.
41. PW1 further deposed that request in the email was in itself contrary to commercial wisdom in so far as any tax which may have become due on the invoice amount became due on the date of issuance of invoice i.e. 02.07.2020. Furthermore, the Reserve Bank of India prohibits any changes in bank accounts in such situations. Despite such glaring anomalies, defendants never tried to verify such an abnormal request through telephone or in person from the plaintiff and as is apparent from Ex. PW1/6, CS (Comm) No. : 13/2024 22/39 defendant no.1 replied to the said email on the same date without ascertaining the genuineness of the email. Bare perusal of said reply shows that the same was sent to " [email protected]"
instead of legitimate email " [email protected]". Defendant no.1 failed to realize that even the email addresses mentioned in CC were not those of plaintiff's. Emails marked in CC i.e. '[email protected]' and '[email protected]' were different from the emails of the plaintiff's accounts department i.e. '[email protected]' and '[email protected]' . Furthermore, defendant no.1 also failed to catch a glaring anomaly, where the emails received by them on 04.08.2020 bore the spoofed email of Mr. Anil Goyal but the same was signed off by " Nitin". Therefore, it was prima facie evident that the email had not originated from the plaintiff.
42. It was further deposed by PW1 that perusal of email trail Ex. PW1/6 shows that defendant no.1 negligently continued to exchange emails with this unknown person, who in a similar manner, vide email dated 04.08.2020, sent a forged letter of authorization dated 04.08.2020 issued to defendant no.2 wherein authority was given to a company named " Nippon Tinplate (Asia) Limited" to receive the outstanding invoice amount alongwith a forged invoice with details of Hong Kong Bank Account of Nippon Tinplate (Asia) Limited Ex. PW1/8. Bare perusal of the forged invoice shows that:
(A) the value stated therein i.e. USD 1,24,806/- does not correspond with the actual invoice value of the goods supplied and (B) the 'signature' affixed thereon is not in fact a signature CS (Comm) No. : 13/2024 23/39 but a picture of 'signature' which does not even correspond with the signatures on the invoice.
43. Further, forged letter of authorization Ex. PW1/7 mentioned an address of defendant no.2 which was never used for any communication between the defendants and the plaintiff. However, instead of raising an alarm and contacting the plaintiff through a different channel for confirmation, defendant no.1 instead sent an email to the unknown persons operating the email [email protected] and sent the correct address details pursuant to which the unknown persons behind the unauthorized emails sent a revised copy of the forged letter of Authorization dated 12.08.2020 Ex. PW1/7.
44. It was also submitted that the defence put forth by the defendants is that they allegedly received instructions from the plaintiff through email dated 04.08.2020 sent to the defendants on [email protected]. Defendants contended that vide said email, they allegedly received instructions from the plaintiff to transfer the Invoice Amount to an unknown entity by the name of M/s Nippon Tinplate (Asia) Ltd and that pursuant to such instructions received via email, defendants transferred the Invoice Amount to the unknown entity.
45. Attention of this court was drawn to the email ID from which the email was sent i.e. [email protected]. It was submitted by Ld. counsel for defendant that the email was received from the genuine email address i.e. [email protected] directing the defendants to make payment in the updated bank details using reply to function by putting email [email protected] as well as cc to [email protected], [email protected] and CS (Comm) No. : 13/2024 24/39 [email protected]. By sending the email from genuine mail and initiating the option of 'reply to', reply made by defendants to the said mails had been siphoned to the address already put in 'reply to' and CC options. It was also stated that in the previous transaction, an email was received from the plaintiff's genuine mail [email protected] dated 10.02.2020, wherein it was informed to defendants that:
"further to the below email, I was just informed by our accountant that we cannot receive payment through out previous bank account due to recent tax imposition on our regular bank account for all international receivable funds. Apology for inconvenience and short notice. Therefore, concerning your attached invoice (Invoice no. DB/1920/040), kindly hold below payment so that we can make final confirmation of our bank details before you remit. On our confirmation, we will forward letter of authorization and revised invoice with our nominated bank details for payment".
46. Thereafter, on 08.05.2020, an email was received by the defendants giving details for payment and accordingly on the same day, defendants made the payment of the said invoice. It was further submitted by Ld. Counsel for defendants that acting on the same premise, defendants after receiving the similar emails dated 04.08.2020, as in case of previous transaction, regarding problem in the bank account of the plaintiff and on receiving the updated bank details through email, defendants without default made the payment of the invoice number DB/2021/006 dated 02.07.2020.
47. It was sought to be clarified by counsel for plaintiff that reference to the previous transaction with regard to change of bank details for payment was only because of the merger of the previous bank and except for the change in the name of the bank, all the details including account number, place and the country had remained the same. Whereas, pertaining to instant CS (Comm) No. : 13/2024 25/39 transaction, defendants did not verify the details nor sought confirmation from the plaintiff.
48. With regard to the submission that after the email dated 4.8.2020 had been received, defendants had responded with option given as 'Reply to', it was submitted that when a person reply to emails, he clicks 'reply to all' and the email reply will be delivered to the person who had sent the email to that person. In the instant matter, as is brought on record, the email though had been received from [email protected] however in the reply option, the email address as mentioned was [email protected] . Besides that, the CC was also on the slightly different address which apparently was not belonging to plaintiff or any of its employees i.e. emails marked in CC i.e. [email protected] and [email protected] were different from the emails of the plaintiff's accounts department,i.e."[email protected]"and"rajeshmohindr [email protected] .
49. Not only the email addresses were different in the 'reply' option but also in the invoice further sent, amount of transaction was written as USD 1,24,806/- instead of actual amount of 1,24,956. Address of Plaintiff as mentioned in the communication dated 4.8.2020 Ex. PW1/7 was also wrong which was of Kuala Lumpur, whereas in the next communication dated 12.8.2020, again address was changed to Malaysia. Though email ID and names were correctly mentioned but these documents were not sent through email. Contention of counsel for plaintiff is also found correct that in both the documents i.e. communication dated 04.08.2020 and communication dated 12.08.2020 Ex.
CS (Comm) No. : 13/2024 26/39PW1/7 (colly), signatures had also been pasted and both the documents did not contain the original signatures.
50. Contention of counsel for plaintiff is meritable that there are so many discrepancies in the emails and documentation i.e.
(a) email address for reply is wrong
(b) sender name and address is wrong
(c) figure is different.
(d) signatures are pasted and not signed.
(e) All the relevant details pertaining to address, party name and the bank details have been changed.
51. As submitted, even then defendants did not feel it appropriate to seek confirmation from the plaintiff whether all these changes had actually been required by the plaintiff.
52. DW1 stated that there was no need of independent verification as they always had communication with the plaintiff through emails and when they received email communication from the plaintiff from their official email ID (which was always being used by them) with the revised invoice and authorization, they made payment to M/s Nippon Tinplate. DW1 further admitted that Ex. PW1/8 which was the revised invoice had been denied in Affidavit of Admission/Denial of documents. He denied that this document was denied as he was aware that the said document was forged document. He stated that defendant had made the payment on the basis of revised invoice Ex. PW1/8 which mentions different account number in which they had made the payment. He stated that it is normal practice for the supplier to ask for the payment in different bank account even after the delivery, however the said request must be supported with correct document such as revised invoice and authority CS (Comm) No. : 13/2024 27/39 letter. He stated that he did not verify about change of account number using the telephone numbers or email IDs of Mr. Rajesh Mohindra and Mr. Anil Goyal before making the payment.
53. DW1 stated that they had previously also received an email from the plaintiff that they want to change the bank account where payment has to be remitted. Similar request was also made for transaction in question and hence there was no requirement of verifying the same.
54. DW1 was referred to Ex. PW1/D2 which was previous email under reference. He admitted that reply to said email appears just above (preceding) the email Ex. PW1/D2 which was sent to [email protected]. He stated that this was not the correct email ID of the plaintiff. He also admitted that whenever any email is replied by clicking " Reply to All", the reply is delivered to the email address from which the original email was received alongwith the persons to whom it was marked. Attention of this witness was drawn to Ex. DW1/X and he stated that he stood by the averments that [email protected] is the fake email ID which fact came into their knowledge later on through plaintiff.
55. DW2 admitted that all the communications between plaintiff and defendants were through email ID i.e. [email protected] belonging to defendant and [email protected] belonging to plaintiff. He admitted that no other email ID was used for communications for either by plaintiff or by defendant. This witness also stated that he had replied the email by using 'reply all' function of the email from which he had received the same. He had not himself typed the email ID while sending the reply. He had not verified email ID of CS (Comm) No. : 13/2024 28/39 the plaintiff while replying to mail dated 04.08.2020. According to him, he had not verified as there was entire history of emails from the said ID. Both the email IDs were very much similar. He denied that he got confused by the similar email IDs but admitted that now he realized that the email ID to which the reply was sent, was that of some different party other than plaintiff.
56. Expert witnesses were examined by both the parties. DW3 is a Cyber Security Analyst. He was engaged to provide services of cyber security to Plus Max Group of Companies and to find out whether any attack on the system of the company occurred or it was from the end of Dynamic Brands. During the process, he had taken access to emails of [email protected] and [email protected] and analyzed the same. He sought metadata of emails dated 04.08.2020 received from [email protected] and replied to all by Ashok Kumar through [email protected] and checked all the subsequent trail emails. He found that email dated 04.08.2020 was sent from [email protected] at 08:30:50 to [email protected] and CC to [email protected], [email protected] and [email protected]. Further in reply to the sender marked [email protected]. In this way, when Ashok Kumar replied the email by selecting the option ' Reply to All' , the emails were sent to the emails addresses already marked by the sender of email [email protected] dated 04.08.2020 at 08:30:50. Accordingly, the trail mails were received and sent by selecting the option of 'Reply to all' from both the sides. It was deposed by DW3 that from comparison of metadata and emails addresses on the emails, nothing had been changed or altered CS (Comm) No. : 13/2024 29/39 from the side of Plus Max Group of Companies and it responded only on the email originally sent through [email protected] . Report was placed on record as Ex. DW3/2.
57. This witness however stated that he was neither the author of report Ex.DW3/2 nor the part of the team which prepared the said report, though he sought to clarify that he had verified the said report. He conceded that analysis referred in the report Ex. DW3/2 was not conducted in his presence and he was told by his senior about the analysis conducted. He had taken the printouts of Meta data Ex. DW3/4 and Ex. DW3/5 by remotely connecting himself with the email account of the defendants in its computer system. He admitted that the metadata and the header, the printout of which he had taken using his system, was there in the email account of the defendants. He also admitted that he had not mentioned the methodology or the steps taken to analyze the metadata in his affidavit Ex. DW3/X. He further admitted that the metadata and the email headers are created at the moment the mail is received in the inbox and that there was gap of three years between the date when the metadata and the email header was created and the date when the printout of the same was taken by him. He admitted that he had not mentioned any methodology used to ensure that the metadata and email headers were not tampered between the said period when the same was with the defendants. But sought to clarify that the metadata and email headers were downloaded directly from the google server and hence there was no chance of tampering.
58. DW3 further admitted that when metadata is downloaded from the google server, a separate file is created for metadata CS (Comm) No. : 13/2024 30/39 pertaining to each email. If the metadata pertains to single email, a single metadata file will be downloaded but if it pertains to loop of mails, then metadata of entire loop will be downloaded. He admitted that Ex. DW3/4 comprises of five separate metadata files for five separate emails and for proper analysis of an email, the complete analysis of entire metadata is required. This witness was put question that metadata pertaining to email dated 04.08.2020 at 08:30 consisted of total of 91 pages as mentioned in the footer at point 'A', however only four pages thereof have been filed on record, to which he answered that he has filed four pages because the same were only relevant as per the screenshot which also mentions the time of the email.
59. He admitted that report Ex. DW3/2 was prepared after analysis of metadata. He had contacted Mr. Saurabh Bhatnagar on 04.10.2023 to take access of the computer system of defendant to take print out of metadata and email account. He admitted that when he contacted Mr. Saurabh Bhatnagar on 04.10.2023, report Ex. DW3/2 was already prepared, though he verified the report contacting Mr. Saurabh Bhatnagar. He was put question to tell which one out of two emails in question i.e. [email protected] and [email protected], is genuine and original email of Mr. Ani Goyal of plaintiff company, to which he was unable to tell.
60. DW1 is Sh. Saurabh Bhatnagar who admitted that transaction pertaining to payment made to Dynamics Brands private Limited by the defendants upon checking was found to be fraudulent transaction . He stated that the transaction was done by their accounts team. Although he admitted that he got registered an FIR against some unknown persons. Attention of CS (Comm) No. : 13/2024 31/39 this witness was drawn to the copy of FIR Ex. P-5 from point 'A' to 'B' after which he admitted that there was mention in FIR Ex. P-5 that defendant was victim of scam. Witness sought to clarify that though no scam was done against them but they had mentioned so, in order to help the plaintiff.
61. Expert witness examined by plaintiff was PW2 who had taken access to:
(a) The Computer System through which the email communication with the defendants took place
(b) The email ID [email protected] alongwith the personal storage table (.pst) file and logs pertaining to [email protected]
(c) the email trail (in .pdf formal) shared by [email protected] on 18.08.2020 with the plaintiff containing the impugned email conversation regarding alleged change in payment terms by the plaintiff.
62. PW2 checked the Personal Storage Table file and the Logs for any modification, alteration or deletion of files and found no modification, alteration or deletion in the same. Upon assessment, the data was found to be genuine with no tampering. He submitted his report Ex. PW2/A. He ran checks on the entire email trail containing 29 emails and identified that from 4.8.2020 onwards, defendant no.1 shared the entire email trail and started conversing with a third party instead of the plaintiff. Further, to cross-check the emerging fact that the emails from 04.08.2020 onwards in the said email trail did not originate from [email protected], he checked the entire email trail against the Personal Storage Table (.pst) file pertaining to [email protected].
CS (Comm) No. : 13/2024 32/3963. PW2 deposed that based on his professional, technical knowledge, he could say that a Personal Storage Table (.pst) file of email address maintained on Outlook contains the logs of all emails sent and received from that email address and that if a certain email is not found in the PST File, it has not been sent by or received from the email address (as the case may be). Upon tallying the email trail with the PST file pertaining to [email protected], he concluded in his professional and technical assessment that :
a. the following emails were not found on the PST file and did not originate from [email protected]:
04.08.2020 08:30 04.08.2020 13:18 12.08.2020 04:01 13.08.2020 11:22 P.M. b. The following emails sent by defendant no.1 using the email address [email protected] and [email protected] were not sent to [email protected]:
04.08.2020 06:52 11.08.2020 07:39 13.08.2020 3:04 13.08.2020 15:24 18.08.2020 1:23 PM
64. In cross-examination, PW2 stated that the email ID which was configured on the computer system inspected by him could not be accessed from any other system in the office of plaintiff. Account which was accessed by him was not activated for webmail access and it only had POP3/IMAP, due to which the CS (Comm) No. : 13/2024 33/39 email account [email protected] can only be accessed through " Microsoft Outlook".
65. This witness was put to extensive cross-examination and he was able to answer with regard to the procedure adopted and its analysis. He denied that address of the sender in Ex. PW1/D1 and Ex. Pw1/D2 is [email protected]. He stated that the basis of his denial to the said question was that the domain name in the said email had been modified in the expert opinion. He also denied that address mentioned in Ex. D-12 as [email protected] was the same as that of Ex. PW1/D1 and Ex. PW1/D2. According to him, mail ID in Ex. PW1/D1 and Ex. PW1/D2 were modified. There was break in the trailing mail, therefore, IDs mentioned in all the three emails could not be same. He was put question as to why he had not mentioned the email trails of Ex. PW1/D1 and Ex. PW1/D2 despite observing irregularity in them, to which he answered that he had only mentioned about the irregular email trails which were found in PST date or deleted logs. Ex. PW1/D1 and Ex. PW1/D2 were not found in PST data or in deleted logs, hence were not mentioned in the report. He had checked PST data for the emails alleged to have been sent by defendant to the plaintiff. While doing so, he did not find emails mentioned by the defendant in his trail mail alleged to have been sent to plaintiff. He stated that every email which is sent or received consist of one prefix encrypted header for sending or receiving emails which gives complete road map of communication protocol under POP3 or IMAP protocol for getting the source and destination mail flow addresses. This entire process is called metadata in context of emails which is used for getting the email flow detail.
CS (Comm) No. : 13/2024 34/3966. PW2 admitted that the address of emails which are sent or received are saved in metadata and that the information stored in metadata cannot be modified. He did not find any backup file related to the email account configured on the computer system analysed by him. He stated that he had prepared the analysis report after examining all the trail mails in the computer system analyzed by him and further stated that only one outlook mail application can be configured on one system.
67. PW2 further stated that he had checked the metadata of email ID referred by him in report Ex. PW2/A and denied that he had not annexed any document related to metadata as the email flow in respect of entire trail mail was saved in the metadata.
68. From the examination of witnesses as noted above and perusal of the expert report, it can be concluded that email pertaining to change of details had not been sent by plaintiff and defendants had sent reply to the different email IDs and also followed the instructions of the sender from fake email address. Thereby it was the defendant who was the victim of cyber fraud.
69. Counsel for plaintiff also submitted that it was the contention of defendants that they did not check or confirm with the plaintiff because plaintiff had allegedly made such request to them during the previous transaction as well. On behalf of defendant, Ex. DW1/3 was referred to i.e. email dated 10.02.2020 with following extract:
" further to the below email, I was just informed now by our accountant that we cannot receive payment through out previous bank account due to recent tax imposition on our regular bank account for all international receivable funds. Apologies for the inconveniences and short notice.
Therefore concerning your attached invoice (Invoice no. DB/1920/040), kindly hold below payment so that we can make final confirmation of our bank details before you remit.CS (Comm) No. : 13/2024 35/39
On our confirmation, we will forward LETTER OF AUTHORIZATION AND REVISE INVOICE with our nominated bank details for payment.
Please confirm receipt by return mail".
70. This email was sent from email address [email protected] at 3:10:29 PM which was responded vide mail dated 10.02.2020 at 07:57 followed by another communication from [email protected]. It was submitted by Ld. Counsel for plaintiff that in the said emails, the scammers made the same plea (as in the impugned transaction) to the defendants about changing of bank accounts. However, the defendants did not act on these emails and no payment was made pursuant to these emails. Payment of the invoice amount in the previous transaction was made to the Plaintiff's bank account on 08.05.2020 which was in no way connected to the above fraudulent email as there was gap of 88 days between the fraudulent email dated 10.02.2020 and the date of payment. Payment made by the defendants in the previous transaction was made by the defendants after confirming the same from the plaintiff and the same is evident from the Plaintiff's email dated 08.05.2020 (11:15:34) Ex. DW1/3 vide which defendants asked the Plaintiff for its bank details, upon receipt of which the defendants made the payment. It was submitted that it rather points out that the scammers who scammed the defendants in the transaction forming the subject matter of the present suit had also tried to scam the defendants in an identical manner in the past transaction. While the Defendants exercised their diligence and did not act on the fraud emails in the previous transaction and made the payment only after confirming with the Plaintiff, they deliberately failed to exercise such diligence in the present CS (Comm) No. : 13/2024 36/39 transaction and apparently fell victim to the scam owing to their own negligence, for which liability cannot be shifted upon the plaintiff.
71. Having discussed above, the conclusion which can be drawn is that the defendants were the victim of cyber fraud. Considering the discrepancies as noted (supra), despite the change in invoice amount, particulars of bank details and the entity, defendants did not exercise due diligence in seeking confirmation from the plaintiff, resultantly defendants though has made payment but plaintiff has not received the payment against the delivery of consignment.Defendants made the payment to third party and failed to bring on record that it was in pursuance to the instructions by the plaintiff.
72. While the duty of seller to deliver the goods and of buyer to receive was discharged but buyer's duty to pay for them and seller's entitlement to receive the payment against the supply, in the peculiar circumstances of the instant case, remained un- discharged. Plaintiff despite supplying the material did not get its dues. In these circumstances, is entitled to receive its dues from the defendants. Issue no.3 is answered in favour of plaintiff and against the defendants.
Issue no 4:
73. Plaintiff has claimed interest @ 2% per annum from 02.09.2020 till the date of realization. It was submitted by Ld. Counsel for plaintiff that section 61(2)(a) of The Sale of Goods Act, 1930 states:
"61(2): In the absence of a contract to the contrary, the Court may award interest at such rate as it thinks fit on the amount of the price:CS (Comm) No. : 13/2024 37/39
(a) To the seller in a suit by him for the amount of the price -
from the date of the tender of the goods or from the date on which price was payable"
74. It was submitted that the provision under Section 61(2)(a) of the Sale of Goods Act, 1930 was deliberated upon by the Hon'ble Supreme Court of India in Marwar Tent Factory v. Union of India & Ors. MANU/SC/0354/1989 (Paragraphs 18, 19 & 20) wherein the Hon'ble Supreme Court cited judgments of the Hon'ble High Court of Patna and the Hon'ble High Court of Rajastan and approved the ratio that even where there was no stipulation for payment of interest in case the price of goods supplied remained unpaid, the Court can exercise its discretion and award a reasonable rate of interest under Section 61(2) of the Sale of Goods Act, 1930.
75. As further submitted, in the present case, while the Invoice Ex. P-1 does not contain any stipulation qua interest, the Legal Notice sent to the Defendants on 23.10.2020 Ex. P-6, which is an admitted document, mentions that if the Defendants fail to pay the entire amount within seven days from receipt of the notice, the Plaintiff would institute necessary legal proceedings at New Delhi for recovery with interest thereon @ 2% per annum. Further, the last date for the Defendant to make the payment of the Invoice Amount to the Plaintiff was 02.09.2020. On the strength of above, it was submitted by Ld. Counsel for plaintiff that this court has power to award interest at reasonable rate in terms of Section 61(2)(a) of the Sale of Goods Act, 1930 from 02.09.2020 until such time that the Defendants make the payment to the Plaintiff.CS (Comm) No. : 13/2024 38/39
76. It is correct that in ordinary circumstances, plaintiff would be entitled to the interest amount considering that defendants have utilized the amount which was payable to plaintiff during said period i.e. till the date of payment. In the instant matter, defendants had made the payment though to a wrong person. Consequently though the plaintiff has not received the money but defendants have also not utilized the amount. Considering the peculiar circumstances of the case, defendants also cannot be burdened for payment of interest when the amount payable to the plaintiff has not been utilized by them, which is the consideration for grant of interest. In these circumstances, no direction for payment of any interest is passed in the matter. However, if the defendants fail to clear the payment within one month, decreetal amount shall entail the payment of interest @ 9% p.a. after one month of the Judgment till realization.
77. Relief (issue no. 5) : Instant suit is accordingly decreed with cost in favour of the plaintiff and against defendants in sum of USD 1,24,956 or equivalent amount in Rupees as on date of judgment. If the defendants fail to clear the payment within one month, decreetal amount shall entail the payment of interest @ 9% p.a. after one month of the Judgment till realization.
78. Decree sheet be prepared accordingly. After completion of formalities, file be consigned to record room.
Announced in the open (SAVITA RAO)
th
court on this 8 day DISTRICT JUDGE
of April 2024 (COMMERCIAL COURT)-01
SOUTH, SAKET COURTS, DELHI
CS (Comm) No. : 13/2024 39/39