Delhi District Court
Ms Jaggu Mal Agencies vs Ms B.V.Aswathiah Bros. (Regd) on 13 January, 2026
IN THE COURT OF DISTRICT JUDGE -04,
(PRESIDED OVER BY: ANIL CHANDHEL)
WEST DISTRICT, TIS HAZARI COURTS, DELHI
CNR No. DLWT01-000014-2002
Civil DJ No.609941/2016
M/s. Jaggu Mal Agencies,
2/53/3, Sagar Bazar,
Delhi Cantt-110010. ...Plaintiff.
Versus
1. M/s. B.V. Aswathiah & Bros.
29, 1st Cross, Srirampuram,
Bangalore-560021
2. Mr. B.S. Srinivas
Partner of M/s. B.V. Aswathiah & Bros.
29, 1st Cross, Srirampuram
Bangalore-560 021.
3. Mr. B.S. Amarnath
Partner of M/s. B.V. Aswathiah & Bros.
29, 1st Cross, Srirampuram
Bangalore-560 021.
4. M/s. Jugal Kishore Vinay Kumar,
DLF-1A, First Floor,
Moti Nagar,
New Delhi. ...Defendants.
SUIT FOR DECLARATION,
PERMANENT INJUNCTION AND
RECOVERY OF DAMAGES OF
RS.20,27,754/- ALONGWITH INTEREST.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 1 of 66
Civil DJ No. 609941/2016
DATE OF INSTITUTION : 17.01.2002
JUDGMENT RESERVED ON : 13.12.2025
JUDGMENT PRONOUNCED ON : 13.01.2026
Appearaces:
Mr. Mayank Rustagi and Ms. Astuti Verma, Ld. Counsels for
the Plaintiff.
Mr. Sarvendra Singh and Mr. Dhruv Saxena, Ld. Counsels for
the Defendants.
JUDGMENT
1. The Plaintiff has filed the present suit against the Defendants for the prayers of declaration of nullity with regard to letter dated 26.03.2001, rendition of accounts, permanent injunction and damages for an amount of Rs.20,27,754/-.
2. The facts stated in the Plaint:
The averments made in the Plaint are briefly summed up in the paras hereinbelow:
2.1. The Defendant No. 1 is a partnership concern and is engaged in the manufacturing of "Agarbathi" under the brand name "Nandi Agarbathi". The Defendant No. 2 and 3 are partners of the Defendant No.1 and had been dealing with the Plaintiff firm in relevant years.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 2 of 66 Civil DJ No. 609941/2016 2.2. The Defendant No.1 had appointed M/s. Jaggumal Vedprakash (a partnership concern) as sole distributor for its products for the territory of Delhi in 1968. The Plaintiff had succeeded to the aforesaid business of sole distributorship of its predecessor M/s. Jaggumal Ved Prakash. The terms and conditions of appointment were duly agreed to and were also reaffirmed between the parties subsequently. M/s. Jaggumal Ved Prakash became non-functional in 1991 and the Defendants agreed for transfer of distributorship on same terms & conditions to the Plaintiff.
2.3 Due to consistent financial relationship between the parties, the erstwhile Plaintiff firm had turned down the lucrative business of running distributorship/agency of other competitive brand names, which included M/s. Balaji Agarbathi Company, Shri Balakrishna Perfumary Works, Bangalore, Sandesh Perfumery Works, Bangalore etc. Some of these Brands had turned out to be more popular and were doing better business in the territory of Delhi.
2.4. On account of hard work and efforts of the Plaintiff and its predecessor, the modest turn-over of the Defendant No.1 in 1968 had reached the astronomical figure of Rs.41,89292/- in 1997-98. The Defendant No.1 had never complained about the performance of the Plaintiff. On many occasions, the Defendant No.1 had appreciated and acknowledged the exclusive rights of the Plaintiff in the territory of Delhi.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 3 of 66 Civil DJ No. 609941/2016 2.5. The Defendant No.1 to 3 had assured the continuity of this relationship for an indefinite period unless the Plaintiff committed any major default. There was pilferage in the supplies received from Defendant No.1 in 2000-2001 and the Plaintiff objected to same seriously citing specific instances, some of which were M/s. Surya Trading Company, M/s, Jay Agency, M/s. Jugal Kishore Vinay Kumar of Amritsar. In response to a series of correspondences in the aforesaid matter and in breach of the understanding between the parties, the Defendant took sudden and extreme step of termination of distributorship vide letter dated 26.03.2001. The aforesaid letter was a nullity and could not be acted upon as the same was in breach of consistent understanding followed for a long period of 35 years of relationship. The Plaintiff protested against the aforesaid letter and insisted for withdrawal of same. The Plaintiff came to know in August 2001 from a newspaper advertisement that Defendant had appointed M/s Jugal Kishore Vinay Kumar as their sole distributor for their aforesaid products.
2.6. The Plaintiff had suffered enormously due to the aforesaid breach of the agreement. The Plaintiff's substantial business was of the distributorship of Nandi Agarbathi and therefore, the Plaintiff firm had virtually come to a closure. Since, the Plaintiff had declined other business opportunities due to sustained relationship of 35 years with the Defendant No.1, therefore, it would take a minimum of 10 years for the Plaintiff to re-establish its own credential or the business to M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 4 of 66 Civil DJ No. 609941/2016 the extent of being carried out for the products of the Defendant No.1.
2.7. The Plaintiff had deployed two delivery vans, four sales men and two drivers for the business. The Defendant had not brought forth any complaint against the non-delivery or late delivery. Thus, the Defendant was under obligation to continue the relationship and was not entitled to divert the business of sole distributorship to any other firm including M/s. Jugal Kishor Vinay Kumar. The Plaintiff is entitled for following damages / compensation from the Defendants:
a. 4% yearly commission for 2000-2001 Rs.35,934/- b. 2% cash discount for 2000-2001. Rs.5,904/-
c. Over riding communication @ 5% on the total sale of Rs. 10,00,000/- through M/s Surya Trading Company. Rs.50,000/- d. Over riding commission @ 5% on the total sale of Rs.50,000/- through M/s Jay Agency. Rs.25,000/-
e. Over riding commission @ 5% on the total sale of Rs.50,000/- through M/s. Jugal Kishore Vinay Kumar. Rs.25,000/- f. Short Supply receipt which were duly pointed out through correspondence and is not settled till date. Rs.93,500/- g. Cost of damaged or unsalable stock in the last three years. Rs. 2,42,000/-
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 5 of 66 Civil DJ No. 609941/2016 h. Rate difference in the supply of "MIST Agarbathi" with that of similar no tax zone rates supplied by the Defendant in the territory also enjoying the status of no tax zone in last three years. Rs.2,35,000/- i. Due to delay in responding to the certain claim made from time to time which includes the interest @ 24% per annum. Rs. 2,23,000/-
j. The interest unauthorizedly charged in last one year. Rs. 28,432/-
k. The deduction of sum unauthorizedly made in the account of Plaintiff despite timely dispatch of the "C" form immediately after the receipt of the sale tax authority. Rs. 8,900/-
l. Reimbursement of levies on sales
tax @8% in the territory of Delhi
in the period between 16.01.1999
to 31.03.2000 payable by Defendants
under the terms of supply. Rs.55,084/-
m. Loss of goodwill, reputation and
injury. Rs.10,00,000/-
_____________
Total Rs.20,27,754/-
______________
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 6 of 66
Civil DJ No. 609941/2016
2.8 On the basis of abovementioned averments, the Plaintiff has
made following prayers in the suit:
i. Declaration of nullity with regard to letter of
termination of agency dated 26.03.2001;
ii. Permanent Injunction for restraining the
Defendants for carrying out the business through any other agent or through Defendant No.4; iii. Rendition of accounts of business of the Defendants;
iv. Damages for Rs20,27,754/-.
3. Service of the Defendants and the Written Statement:
The Defendants were duly served with the summons of the suit and entered appearance on 21.10.2002. The Defendants have filed joint written statement and denied the averments of the plaint. The averments made by the Defendants in their written statement and constituting their defence are briefly stated hereinbelow:
3.1. The Plaintiff does not have any cause of action. There was no agreement or contract with the Plaintiff regarding sole distributorship of the products of the Defendant No.1.
3.2. It has not been disclosed by the Plaintiff whether it is a partnership concern or a sole proprietorship and whether a legally competent person has signed the plaint. The Plaintiff M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 7 of 66 Civil DJ No. 609941/2016 has not succeeded to the business of M/s Jaggumal Ved Prakash. There was no sole distributorship agreement between the Defendants and M/s Jaggumal Ved Prakash and thus, the question of the Plaintiff "succeeding" to the sole distributorship agreement did not arise. Assuming without admitting that there was a sole distributorship agreement between the Defendants and M/s Jaggumal Ved Prakash, the Plaintiff would still be a stranger to the contract and as such no right accrues to the Plaintiff.
3.3. The present suit suffers from lack of jurisdiction and this Court is not competent to try the suit. The Defendants had made it explicitly clear in their business transactions, as evident from the bills and invoices that disputes, if any, would be subject to jurisdiction of Bangalore Courts only.
3.4. The present suit suffers from misjoinder of Defendants as well as misjoinder of cause of action. The Plaintiff has erred in impleading M/s. Jugal Kishore Vinay Kumar as Defendant No. 4. The said Defendant No. 4 is appointed as a distributor of Defendant No. 1's product and the Plaintiff has no right to relief against Defendant No. 4. The Plaintiffs legal rights are not breached by Defendant No. 4 and its impleadment is bad in law. The present suit suffers from multifariousness.
3.5 The Defendants had never stopped or prevented the Plaintiff from entering in business relations with other M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 8 of 66 Civil DJ No. 609941/2016 firms. The Plaintiff is merely one of the many distributors of the Defendants products and it does not lie in the mouth of the Plaintiff to claim credit for the brand equity and brand value of a product, which is wholly manufactured and made successful by Defendant No. 1. The Plaintiff was never granted exclusive rights to distribute the Defendant No.1's products in Delhi.
3.6 The Defendants had written a letter to the Plaintiff dated 26.03.2001 wherein the Plaintiff was informed that he no longer is the distributor / stockist of the Defendants products. The said letter does not mention anywhere that the Plaintiff has a sole distributorship / agency of the Defendants products in Delhi. The Defendant Nos. 1, 2 and 3 are well within its right to assign distributorship / agency of its products in the Delhi to any distributor including Defendant No. 4 firm and the Plaintiff has no vested right to make any claim to the contrary. The Defendants found the performance of the Plaintiff highly unsatisfactory and hence cancelled the distribution arrangement with the Plaintiff. The Defendant No.4 was appointed a mere distributor and not as a sole /exclusive distributor.
3.7 Whenever the Plaintiff placed orders for the products of the Defendants, the Defendants duly dispatched the consignment of products, which were ordered. There was an outright sale and there was no scope of any sole distributorship / agency. The Orders were dispatched at the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 9 of 66 Civil DJ No. 609941/2016 buyer's / Plaintiff's risk and the Defendants were not liable thereon for any loss, damage or pilferage.
3.8 There never was any agreement between the Plaintiff and the Defendants, so the question of its breach does not arise. The Plaintiff by its own admission came into existence only in 1991. Hence the submission that the Plaintiff's market reputation of over 35 years is untrue. Assuming, without admitting it were to be accepted that the Plaintiff had a contractual right to be the sole selling agent of the Defendants products in Delhi, there was nothing to prevent the Plaintiff from accepting the sole selling agency of other firms and expending its business.
3.9 The Plaintiff, in the present suit, has not disclosed the particulars of the pilferage and the person(s) responsible for the pilferage of the products and yet the Plaintiff astonishingly seeks to make the defendants liable for the pilferage. The Plaintiff is not legally competent to claim any damages/compensation, monetary or otherwise, for discontinuation of supply/pilferage of goods or any over riding commission on the entire sales in the territory of Delhi. The Plaintiff was given commission, in the nature of discount in price for the products of the Defendants, which were sold. In the event of the Plaintiff not selling any of the Defendants products, the question of paying any commission to the Plaintiff simply does not not arise.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 10 of 66 Civil DJ No. 609941/2016
4. Replication:
4.1 The Plaintiff has filed the replication/rejoinder, wherein the Plaintiff has traversed the contents of the written statement of the Defendant and has made the necessary denials, reiterating the contents of the plaint.
5. Issues:
5.1 On the basis of the pleadings of the parties, the following issues were framed on 18.07.2005: -
i. Whether the Plaintiff has disclosed any cause of action? OPP.
ii. Whether this Hon'ble Court has territorial jurisdiction to try and entertain the present suit? OPD.
iii. Whether the suit is bad / suffers from misjoinder of Defendant No. 4 as well as misjoinder of cause of action? OPD.
iv. Whether the Plaintiff is entitled to decree of suit amount? OPP.
v. Whether there was any agreement or contract between the Defendants and Plaintiff, granting sole distribution of the Defendant's products to the Plaintiff? OPD.
vi. Whether the Plaintiff is entitled to the interest, if so at what rate and on what amount? OPP.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 11 of 66 Civil DJ No. 609941/2016 vii. Whether the Plaintiff is entitled to a decree of permanent injunction as prayed?
viii. Whether the Plaintiff is entitled to a decree of declaration, as prayed? OPP.
ix. Whether the Plaintiff is entitled to a decree of rendition of account, a prayed? OPP x. Relief.
6. The Plaintiff's Evidence:
6.1. The Plaintiff has led his evidence and has examined two witnesses in support of his case. The manager of Plaintiff is examined as PW-1, who has reiterated the averments of the plaint in his examination in chief. The PW-1 has exhibited and relied upon the following documents in his examination-
in-chief:
i. Exhibit PW-1/A: Copy of advertisement. ii. Exhibit P-1: Letter dated 26.03.2001. iii. Exhibit P-2 to P-6: Telegrams exchanged between the parties.
iv. Exhibit P-7: Letter dated 07.05.2001.
v. Exhibit P8: Letter dated 15.05.2001.
vi. Exhibit P-9 to Exhibit P-13: Acknowledgments.
vii. Exhibit P-14: Newspaper Advertisement.
viii. Exhibit P-15: Letter dated 14.06.1995.
ix. Exhibit P-16: Letter dated 01.04.1997.
x. Exhibit P-17: Letter dated 21.08.1998
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 12 of 66
Civil DJ No. 609941/2016
xi. Exhibit PW-1/A: Copy of newspaper HT dated
20.03.1968.
xii. Exhibit PW-1/B: copy of letter dated 29.04.2001.
xiii. Exhibit PW-1/C: copy of letter dated 19/05.2001.
xiv. Exhibit PW-1/D to Exhibit PW-1/G: Telegrams.
xv. Original copy of letter dated 01.10.1999.
xvi. Exhibit PW-1/H: letter dated 01.10.1999.
The PW-1 was cross-examined by Ld. Counsel for the Defendant and the PW-1 has produced the following documents in his cross-examination:
i. Exhibit PW-1/D-1: Authorization dated 15.09.2001. ii. Exhibit PW-1/D-2: Invoice dated 26.03.1998. iii. Exhibit PW-1/D-3: Invoice dated 28.03.1998. iv. Exhibit PW-1/D-4: Copy of FIR dated 07.12.1987. v. Exhibit PW-1/D-5: Copy of Order dated 13.04.1998.
The PW-1 was discharged upon conclusion of his cross examination. Though the document are mentioned by exhibit number in the examination in chief and cross-examination of the PW-1, however the physical exhibits have not been marked or mentioned many of the documents referred to in examination in chief and in cross-examination of the PW-1.
6.2. The Plaintiff has examined the proprietor of Khurana Perfumery Works, namely Mr. Mohan Lal Khurana, as PW-
2. The testimony of PW-2 is oral and he has not relied upon M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 13 of 66 Civil DJ No. 609941/2016 any document in the examination in chief. The PW-2 was cross-examined by Ld. Counsel for the Defendant and was discharged upon conclusion of his cross examination.
7. The Defendant's Evidence:
7.1. The Defendants have examined only two witnesses in support of their case. The DW-1 is one of the partners of the Defendant No.1. The DW-1 has reiterated the averments of the written statement in his examination in chief and has relied upon the following documents in his examination in chief:
i. Exhibit D-1: List of Purchases (1997-98). ii. Exhibit D-2: Invoice dated 29.07.1999. iii. Exhibit D-3: Invoice dated 21.08.1999.
iv. D-4: Letter dated 16.08.2000.
v. D-5: Letter dated 26.03.2001.
vi. D-6: Letter dated 12.04.2001.
The DW-1 was cross-examined by the Ld. Counsel for the Plaintiff and was discharged, upon conclusion of his cross- examination.
7.2. The Defendants have examined the proprietor of M/s. Surya Trading Company as DW-2. The testimony of DW-1 is oral and he has not produced or relied on any document in his examination-in-chief. The DW-2 was cross-examined by the Ld. Counsel for the Plaintiff and was discharged, upon M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 14 of 66 Civil DJ No. 609941/2016 conclusion of his cross-examination.
8. Submissions of the Ld. Counsels for the parties:
8.1. Ld. Counsel for the Plaintiff has submitted that the Defendants have admitted the correspondences between the parties, whereby the nature of the Plaintiff being sole and exclusive distributor is admitted. It is submitted that the Defendant does not dispute the business relationship with the Plaintiff and the factum of the Plaintiff being a distributor of the Defendant No.1 is established from the letter of termination itself, i.e., letter dated 26.03.2001. It is submitted that the Defendant No.1 to. 3 have taken the mutually destructive plea of the Plaintiff not being associated with it as well as the Plaintiff being part of the business. It is submitted that the nature of the Plaintiff being a proprietorship concern was known to Defendant No.1 to 3 as they have been doing business with the Plaintiff for years. It is submitted that the communications admitted by the Defendants establish the nature of distributorship business as being exclusive to the Plaintiff for Delhi region. It is submitted that the Defendant No.1 to 3 have not produced the documents pertaining to business between the parties and the plea of the documents being destroyed is not trustworthy and there should be an adverse inference against the Defendant No.1 to 3 for non-production of the business records and the same leads to the conclusion that the Plaintiff was sole and exclusive distributor of the Defendant No. 1 for M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 15 of 66 Civil DJ No. 609941/2016 the territory of Delhi. It is submitted that the cross- examination of DW-1 and DW-2 would reveal the admission of applicability of the essential elements of claim of the Plaintiff. Ld. Counsel for the Plaintiff has relied upon the following judgments:
i. Shri Dharampal Arora Vs. M/s. Share Tips & Ors.: 2010 SCC Online Delhi 1262.
ii. Rajesh Kumar Aggrawal Vs. Pavneet Singh : 2008 SCC Online Delhi 983.
iii. Ram Kanwar Ram Niwas Vs. Union of India: 2008 LAWPACK (Delhi) 34359.
iv. Raj Kumar Sharma Vs. Pushpa Jaggi: Air 2006 Delhi 156. 8.2. Ld. Counsel for the Defendants has submitted that the Plaintiff was not the sole and exclusive distributor of the Defendant No.1 for the territory of Delhi and therefore there is no foundational right for seeking the declaration of nullity against the termination letter. It is submitted that the nature of the Plaintiff is shrouded in mystery as the same is not stated in the plaint and is spelled out only in the replication as a response to the questions raised in the written statement.
It is submitted that the proprietorship concern cannot be a Plaintiff in a suit and the suit filed in the name of the proprietorship business is not maintainable. It is submitted that no breach of agreement is attributable to the Defendant No.1 and the Plaintiff is not entitled to claim any damage in absence of breach of agreement. It is submitted that the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 16 of 66 Civil DJ No. 609941/2016 Plaintiff has failed to prove the damages sought in the plaint. It is submitted that the contentions of damages are not corroborated explained or proved by production of any document. It is submitted that the burden of proving the damages is upon the Plaintiff and non-production of documents by the Defendant would not aid the case of the Plaintiff. It is submitted that the Defendant No.4 has been unnecessarily made a party and the Plaintiff does not have any right to seek any prayer against the Defendant No.4 on the facts of the case or in law. Ld. Counsel for the Defendants has relied upon the following judgments:
i. P.C. Advertising Vs. The Municipal Corporation of Delhi: 73(1998) DLT 259;
ii. Mirage Marketing Corporation Vs. Vishakha Engineering : 115(2004) DLT 471
9. Conclusions on Issue & Reasons for such Conclusions:
9.1. Issue No. 1: Whether the Plaintiff has disclosed any cause of action? OPP.
9.1.1. The onus to prove the Issue No.1 is upon the Plaintiff. The Plaintiff has filed the present suit seeking damages, rendition of accounts, declaration and permanent injunction. It is case of the Plaintiff that the Plaintiff was the sole distributor of the Defendant's products for the territory of Delhi and his distributorship/agency was wrongly terminated, which has M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 17 of 66 Civil DJ No. 609941/2016 resulted into damages. It is stated in the Plaint that the Defendant No.1 had appointed a partnership concern namely M/s. Jaggumal Vedprakash as sole distributor in 1968 and the same business was inherited by the Plaintiff in year 1991 and the Defendant No.1 had transferred the aforesaid business to the Plaintiff on same terms and conditions. It is stated that the Defendant No.1 to 3 had agreed to continue the aforesaid business for an indefinite period of time, in the event of there being no complaints about performance of the Plaintiff and therefore, agency/distributorship of the Plaintiff was wrongly terminated.
9.1.2. If the written statement of the Defendants is read in totality, the business relations with the Plaintiff are not denied, however the factum of Plaintiff being sole and exclusive distributor in Delhi is denied. It is further stated that the Defendant has not stopped the Plaintiff from entering into business relations with third parties. It is stated that the Defendant No.1 was within its rights to terminate the agreement of distributorship/agency and no damages have been incurred to the Plaintiff. It is stated that the Jaggumal Vedprakash was not sole and exclusive distributor and the Plaintiff did not inherit the aforesaid business. It is further stated that the Plaintiff has not disclosed its nature to understand as to whether the suit is filed by a competent person.
9.1.3. Though the Plaintiff may or may not be entitled to the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 18 of 66 Civil DJ No. 609941/2016 prayers, which remains to be adjudicated in terms of other Issues, however, all in all, it cannot be said that the Plaintiff does not have any cause of action for instituting a suit for damages. The contract between the parties is the contract of agency and the aforesaid contract is a determinable one, unless the same does not fall within the purview of Section 202 of the Indian Contract Act. 1872 and becomes irrevocable. In such a case, the Plaintiff cannot seek specific performance of the contract and is only entitled to damages provided he proves the entitlement and extent of the same.
9.1.4. Ld. Counsel for the Defendants has submitted that the suit is not maintainable for two reasons; firstly that the Plaintiff has not inherited the business of M/s. Jaggumal Vedprakash and;
secondly that the suit is filed in the name of proprietorship concern and is therefore not maintainable.
9.1.5. In so far as the first contention is concerned, there is no evidence to conclude that the Plaintiff has inherited the business of M/s. Jaggumal Vedprakash. M/s. Jaggumal Vedprakash is stated to be a partnership and the Plaintiff is a proprietorship concern. There is nothing on record with regard to constitution and deconstitution/winding up of M/s. Jaggumal Vedprakash. The Plaintiff has not explained as to in what in capacity and how it has inherited or succeeded to the business of partnership concern. There are no pleadings of the business of partnership being legally bound up and there is only an averment of the partnership M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 19 of 66 Civil DJ No. 609941/2016 being de-funct, which does not automatically translate into legal winding up or vesting of all its rights in the Plaintiff to continue future business. Therefore, the Plaintiff has failed to prove that it has inherited/succeeded to the business of Jaggumal Vedprakash. However the aforesaid aspect would not by itself make the present suit not maintainable. Even though the rights of Plaintiff are not traceable through M/s. Jaggumal Vedprakash, it is established that the Plaintiff was a distributor of the Defendant No.1, though the contention of it being sole and exclusive distributor is denied and remains to be adjudicated under other Issues.
9.1.6. In terms of the other submission, it is stated that the Plaintiff is a proprietorship concern and the present suit is not filed by the proprietor, but is filed on behalf of proprietorship concern and therefore is not maintainable. Ld. Counsel for the Defendant has placed his reliance on judgment passed in, 'Miraj Marketing Corporation vs. Vishaka Engineering and Ors.: MANU/DE/1193/2004: 115(2004)DLT 471.' 9.1.7. Ld. Counsel for the Plaintiff has submitted that the business relations with the parties are not denied and it is not disputed that there were business transactions between the Plaintiff and the Defendant No. 1 to 4. It is submitted that the present suit has been filed by the proprietor of the Plaintiff in the name of proprietorship concern and the description of the proprietorship concern as Plaintiff instead of the name of proprietor in the memo of parties is a merely a technical M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 20 of 66 Civil DJ No. 609941/2016 aspect, which does not affect maintainability of the suit as the same is signed, verified and instituted by the proprietor herself.
9.1.8. It has been held by the Hon'ble High Court of Delhi in 'Miraj Marketing Corporation vs. Vishaka Engineering and Ors.: MANU/DE/1193/2004: 115(2004)DLT 471' that a sole proprietorship firm is not a legal entity which can sue or be sued in its own name and such suit relating to or against the affairs or claims of a proprietorship concern has to be brought or made against the person, who is the sole proprietor of the firm. The relevant observations of the Hon'ble Court are being reproduced hereinbelow:
"11. Be that as it may, we may also now look to the second contention which was advanced before us and was hotly debated. It was submitted that the suit was instituted in the name of the proprietorship firm and, Therefore, the said suit was not maintainable. The learned trial court also upheld the said contention and dismissed the suit on that score also. Therefore, the aforesaid plea is very relevant and calls for in depth consideration by us. A proprietorship firm has no legal entity like a registered firm. A suit cannot be instituted in the name of an unregistered proprietorship firm and the said suit is to be instituted in the name of the proprietor. It is an admitted position in the plaint that the plaintiff is a proprietorship firm. There is, however, no statement made in the plaint by the plaintiff as to who is the proprietor of the firm. Shri Amitabh Sharma is described in the cause title of the plaint only as an authorised representative. The name of the proprietor of the said proprietorship firm is not given in the plaint. The original plaint which is placed on record has a verification. However, the signature appended to the said verification appears to be M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 21 of 66 Civil DJ No. 609941/2016 that of Shri A.K. Pandey, who was examined in the suit as PW-2, as the main witness. He stated in his cross- examination that he was the proprietor of the plaintiff firm. He also stated in his cross-examination that the plaint was signed, filed and verified by him. PW-1 also in his cross-examination stated that the plaintiff firm was a proprietorship firm and that Shri A.K. Pandey was the sole proprietor of the plaintiff firm. It was, however, stated by him that the plaintiff firm was a registered firm but he could not state as to when the said firm was registered. It is apparent that Shri A.K. Pandey had not instituted the suit. He had only come as a witness. Even in the amended plaint the suit was shown to have been instituted in the name of the firm. A sole proprietorship firm is not a legal entity which can sue or be sued in its own name. Such suit relating to or against the affairs or claims of a proprietorship concern has to be brought or made against the person who is the sole proprietor of the firm. The plaintiff was described to be a proprietorship firm and represented through Shri Amitabh Sharma. Shri Amitabh Sharma had neither signed the plaint nor he signed the power which was filed in the present case."
However in the above-mentioned case, the suit was not instituted by the proprietor, whereas in the present case, the plaint of the present suit has been signed, verified and instituted by the sole Proprietor.
9.1.9. It has been held by the Hon'ble Single Judge Bench of the Delhi High Court in "K.S. Exports vs. Ethopian Airlines (24.11.2011):MANU/DE/7677/2011", that objective of description of the Plaintiff is to make it known to the Defendant as to who is suing and the aforesaid objection should not be taken to the level of dismissing the suit on this ground alone. The relevant observations of the Hon'ble High M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 22 of 66 Civil DJ No. 609941/2016 Court are being reproduced hereinbelow:
"3. The aforesaid finding has caused a great travesty of justice. Technicalities cannot defeat justice. Firstly, in my opinion, the Trial Court should have exercised its suo moto power under Order 1 Rule 10 (2) CPC by which the Court can order a person to be added as a party to the suit. Infact mis-description in the name of the plaintiff can always be corrected and this is a ratio of the celebrated decision of the Supreme Court in the case titled as M/s Ganesh Trading Co. v. Moji Ram, MANU/SC/0018/1978 : 1978:INSC:17 : 1978 (2) SCC
91. The relevant paras of the said judgment read as under:-
"11. The High Court had also referred to Jai Jai Ram Manohar Lal, v. National Building Material Supply, Gurgaon MANU/SC/0016/1969 : 1969:INSC:83 : [1970] SCR 22 but had failed to follow the principle which was clearly laid down in that case by this Court. There, the plaintiff had instituted a suit in the name of Jai Jai Ram Manohar Lal which was the name in which the business of a firm was carried on. Later on, the plaintiff had applied to amend the plaint so that the description may be altered into "Manohar Lal Proprietor Jai Jai Ram Manohar Lal." The plaintiff also sought to clarify paragraph 1 of the plaint so that it may be evident that "Jai Jai Ram Manohar Lal" was only the firm's name. The defendant pleaded that Manohar Lal was not the sole proprietor. One of the objections of the defendant in that case was that the suit by Manoharlal as sole owner would be time barred on 18th July, 1952, when the amendment was sought. In that case, the High Court had taken the hyper technical view that Jai Ram Manohar Lal being "a non-existing person" the Trial Court could not allow an amendment which converted a non- existing person into a "person" in the eye of law so that the suit may not be barred by time. This Court M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 23 of 66 Civil DJ No. 609941/2016 while reversing this hypertechnical view observed (at p. 1269):
"Rules of procedure are intended to be a handmaid to the administration of justice. A party cannot be refused just relief merely because of some mistake, negligence, inadvertence or even infraction of the rules of procedure. The Court always gives leave to amend the pleading of a party, unless it is satisfied that the party applying was acting mala fide, or that by his blunder, he had caused injury to his opponent which may not be compensated for by an order of costs. However negligent or careless may have been the first omission, and however late the proposed amendment, the amendment may be allowed if it can be made without injustice to the other side."
4. I am strengthened in the view which I am taking by Section 3(42) of the General Clauses Act, 1897 and which defines a person to include a company or association or body of individuals, whether incorporated or not. Section 3(42) reads as under:-
" Section 3(42). "person" shall include any company or association or body of individuals, whether incorporated or not;"
Thus, it is not necessary for a person to be a natural person or even a corporate entity for suing as a plaintiff. Obviously, the object is only to ensure that the defendant knows that who is suing, and which cannot be taken to the level of hyper-technicality when it is known that who is the plaintiff i.e. a sole proprietorship concern and that the proprietor of the sole proprietorship concern/plaintiff is also known to be a particular person."
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 24 of 66 Civil DJ No. 609941/2016 It is thus held in the above-referred judgment that the Court in such cases instead of dismissing the suit should suo-moto implead the proprietor as a party to the suit.
9.1.10. The Hon'ble Single Judge Bench of Delhi High Court, relying upon the Mirage Marketing (supra), has held in "Svapn Constructions Vs. IDPL Employees Cooperative Group Housing Society Ltd. and Ors: 127(2006) DLT 80", that a proprietorship concern cannot maintain an action in law in its name and dismissed the application filed under Section 11(6) of the Arbitration and Conciliation Act, 1996. However in appeal, the Hon'ble Supreme Court set aside the aforesaid view vide an Order dated 15.04.2010 passed in Civil Appeal No.3336/2007, titled "M/s. SVAPN Construction v. IDPL Employees Cooperative Group House Society Ltd. & Ors." It has been held by the Hon'ble Supreme Court that law has to do the substantial justice and has not to go by the hyper-technicalities.
9.1.11. The Hon'ble Sigle Judge Bench of the Hon'ble High Court of Delhi has recently discussed the import of all the above- mentioned judgments in "Balcorp Limited Vs. Ganga Ram Brij Mohan: 2024 (14.11.2024):DHC:8785", and it was held that not only can the defendant be sued in the assumed name, but even where the suit is filed in the assumed name, it would at best be a technical defect, which can be cured by the plaintiff at a later date (para 42 of the judgment).
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 25 of 66 Civil DJ No. 609941/2016 9.1.12. The facts in the present case are in distinction with the facts of the Mirage Marketing (supra) and further in view of the above referred judgment, if the proprietor is not impleaded, the Court still has the power to implead the proprietor as a party to the present suit. Therefore, this Court is not inclined to dismiss the suit on this ground alone and is inclined to implead the sole proprietor as a party to the suit, if the entitlement of the Plaintiff is made out in terms of the other Issues in the suit. Thus, it is held that the Plaintiff has a cause of action to institute the present suit. The Issue No.1 is accordingly decided in favour of the Plaintiff and against the Defendants.
9.2. Issue No.2: Whether this Hon'ble Court has
territorial jurisdiction to try and
entertain the present suit? OPD.
9.2.1. The onus to prove the Issue No.2 is upon the Defendant. The Issue No.2 is framed on the basis of preliminary objection No.4 of the written statement. It is stated by the Defendants that the bill and Invoices of transactions between the parties contained an exclusive jurisdiction clause, whereby exclusive jurisdiction was conferred upon the Courts of Bangalore.
9.2.2. The Defendants in order to prove the exclusive jurisdiction clause have relied upon Invoices dated 29.07.99 & 21.08.1999, i.e., Exhibit D-2 and Exhibit D-3. The Plaintiff M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 26 of 66 Civil DJ No. 609941/2016 has produced the invoice dated 26.03.1998, i.e., Exhibit PW-1/D-2 and the invoice dated 28.03.1998, i.e., Exhibit PW-1/D-3, during cross-examination of the PW-1. In all of the aforesaid four invoices, it is written at the bottom left- hand corner 'Subject to Bangalore City Jurisdiction.' 9.2.3. The aforesaid four invoices pertain to small part of the transactions and cause of action pertaining to the present suit is not based upon the transactions contained only in the aforesaid four invoices. The Plaintiff has stated in the plaint that it was the sole distributor of the Defendant No.1 for its products in Delhi, which was agreed to be continued for an indefinite period and the Defendant No.1 has wrongly terminated the aforesaid contract. In terms of the totality of the averments made in the written statement, it has been made established that the Plaintiff was distributor/agent of the Defendant No.1 in Delhi, however the factum of it being sole and exclusive distributor is denied. The dispute being subject matter of the present suit does not pertain to supply of the goods, in terms of the aforesaid four invoices filed on record, however it pertains to the issue of the Plaintiff being the sole distributor, having right to seek continuation of the contract for an indefinite period and the termination of the contract being rightful or wrongful. Thus, the dispute does not pertain to supply for any particular period, but with regard to nature of the distributorship agreement and the rights of the parties thereunder. The parties have not produced any agreement or document on record, whereby M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 27 of 66 Civil DJ No. 609941/2016 the aforesaid agreement was made subject matter of jurisdiction Bangalore Courts. Therefore, the Courts of Bangalore did not have exclusive jurisdiction to entertain and adjudicate the dispute being subject-matter of present suit and the jurisdiction of other Courts is not ousted.
9.2.4. Since the contract was to be performed at Delhi, therefore, the cause of action has arisen within the territorial jurisdiction of Courts at Delhi and this Court accordingly has jurisdiction to entertain, adjudicate and decide present suit. The Issue No.2 is accordingly decided in favour of the Plaintiff and against the Defendants.
9.3. Issue No.3: Whether the suit is bad / suffers from misjoinder of Defendant No. 4 as well as misjoinder of cause of action? OPD.
9.3.1. The onus to prove the Issue No.3 is upon the Defendants.
The Issue No.3 is framed on basis of preliminary submission No.7 of the written statement. It is stated in the aforesaid para that the Plaintiff has no right to relief against the Defendant No.4 as there is no contract between the Plaintiff and the Defendant No.4 and the Plaintiff's legal rights are not breached by the Defendant No.4.
9.3.2. The Plaintiff has filed the present suit for damages on account of termination of its sole distributorship by the Defendant No.1. It is case of the Plaintiff that the Plaintiff M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 28 of 66 Civil DJ No. 609941/2016 was appointed and operating as sole distributor of the Defendant No.1 in the Delhi. It is stated that the Defendant No.1 has arbitrarily terminated the aforesaid contract for distributorship and the same has resulted in damages to the Plaintiff. The Defendant No.4 is the new distributor appointed by the Defendant No.1. There is no contractual relationship per-se between the Plaintiff and the Defendant No.4. Though the Plaintiff has sought the declaration and permanent injunction against the act of termination of the agency of the Plaintiff and operation of business by the new distributor, however, the contract between the parties, i.e., between the Plaintiff and the Defendant No.1, is a determinable one and the Plaintiff cannot seek specific performance of the same. Since the Plaintiff cannot seek specific performance of the contract between the Plaintiff and the Defendant No.1, therefore, in terms of Section 41 (e) of Specific Relief Act, 1963, the Plaintiff is not entitled to any injunction against the Defendant No.4 in pursuance of such a contract. The aforesaid aspects are discussed in greater detail in the Issue No.7. Therefore, the Plaintiff may have right to seek damages from the Defendant No.1, the Plaintiff does not have any right or cause of action to seek any relief against the Defendant No.4. Thus, the Defendant No.4 has wrongly been joined as a party in the suit. The Issue No.3 is accordingly decided in favour of the Defendant No.4 and against the Plaintiff.
9.4. Issue No. 4: Whether the Plaintiff is entitled to M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 29 of 66 Civil DJ No. 609941/2016 decree of suit amount? OPP.
9.4.1. The onus to prove the Issue No.4 is upon the Plaintiff. The Plaintiff has claimed in the suit that his sole distributorship/agency was wrongly terminated by the Defendant No.1 and the same has been resulted in damages to the Plaintiff. In order to claim the damages, the Plaintiff has to first prove that the Defendants were guilty of breach of contract between the parties and the damages cannot be granted if the breach is not proved. In order to prove the breach of contract on the part of the Defendants, the Plaintiff has to prove that the Plaintiff was the sole distributor of the Defendant No.1 and the Defendant No.1 was not entitled to terminate the contract or has terminated it in violation of terms of such contract. The scope of proof of aforesaid facts/ aspects is covered by the Issue No.5, 7 & 8 and will be discussed under the aforesaid Issues. Once the Plaintiff proves his case under the aforesaid Issues, i.e., the breach of contract on the part of the Defendant, the Plaintiff has to prove that he had incurred the damages by proving the the quantum of such damages. This Court is not deciding the aspects of the Issue No.5, 7 & 8 herein and the same will be decided under aforesaid Issues, however, this Court is proceeding to decide the fact whether the Plaintiff has proved the damages or not.
9.4.2. The Plaintiff has quantified the damages in Para No.11 of the Plaint, which are being reproduced hereinbelow:
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 30 of 66 Civil DJ No. 609941/2016 Particulars Amount (in Rs.) 4% yearly commission for 2000- 35,934/-2001
2% cash discount for 2000-2001. 5,904/-
Overriding commission @5% on 50,000/-
the total sale of Rs.10,00,000/-
through M/s Surya Trading
Company.
Over-riding commission @ 5% 25,000/-
on the total sale of Rs.50,000/-
through M/s Jay Agency.
Over-riding commission @ 5% on 25,000/-
the total sale of Rs.50,000/-
through M/s. Jugal Kishore Vinay
Kumar.
Short Supply receipt which were
duly pointed out through 93,500/-
correspondence and is not settled
till date.
Cost of damaged or unsalable 2,42,000/-
stock in the last three years.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 31 of 66
Civil DJ No. 609941/2016
Rate difference in the supply of
"MIST Agarbathi" with that of 2,35,000/-
similar no tax zone rates supplied
by the Defendant in territory also
enjoying the status of no tax zone
in last three years.
Due to delay in responding to the 2,23,000/-
certain claim made from time to
time which includes the interest
@ 24% per annum.
The interest unauthorizedly
charged in last one year. 28,432/-
The deduction of sum
unauthorizedly made in the 8,900/-
account of Plaintiff despite
timely dispatch of the "C" form
immediately after the receipt of
the sale tax authority.
Reimbursement of levies on sales
tax @8% in the territory of Delhi 55,084/-
in the period between 16.01.1999
to 31.03.2000 payable by
Defendants under the terms of
supply.
Loss of goodwill, reputation and
injury. 10,00,000/-
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 32 of 66
Civil DJ No. 609941/2016
Total 20,27,754/-
9.4.3. The Plaintiff has examined two witnesses in his case. The testimony of PW-2 is not relevant for proving the quantum and extent of damages. The sole proprietor of the Plaintiff has not stepped into the witness box. The Plaintiff has examined its manager as PW-1 to prove the factum of damages incurred to it. The PW-1 in his examination in chief has reiterated the table mentioned in the para 11 of the plaint without any further explanation or elaboration of the same.
The abovementioned heads of claim of the Plaintiff are considered one by one hereinbelow:
i. Claim No.(i): 4% yearly commission for 2000-2001:
Rs.35,934/-: In order to infer the amount of the aforesaid commission, it was essential to spell out the amount of the transactions, upon which it was applicable. There is nothing on record to infer the total value of transactions of the aforesaid year. The documents of transactions such as invoices or statement of account for inferring the annual value to conclude the amount have not been filed.
ii. Claim No.(ii): 2% cash discount for 2000-2001:
Rs.5,904/-: The PW-1 has relied upon the following letters to prove the aforesaid entitlement:
Exhibit PW-1/3: letter dated 29.04.2001 M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 33 of 66 Civil DJ No. 609941/2016 Exhibit P-7: letter dated 07.05.2001 Exhibit P-8: letter dated 15.05.2001 Exhibit PW-1/C: Letter dated 19.05.2001 All the above-mentioned letters were written subsequent to the letter of termination dated 26.03.2001. The Plaintiff has raised a claim of cash discount and commission in terms of letter dated 29.04.2001, i.e., Exhibit PW-1/3, which was denied by the Defendant No.1 in terms of letter dated 07.05.2001, i.e., Exhibit P-8. The letter dated 15.05.2001 (Exhibit P-8) and the letter dated 19.05.2001 (Exhibit PW-
1/C) are merely demand letters subsequent to termination, and no specifications of amount due was even mentioned in the aforesaid letters. The aforesaid letters by themselves would not prove the entitlement in terms agreement for payment of such amounts.
The Plaintiff has not mentioned the amount of transactions, upon which the aforesaid cash discount is claimed. The documents of transactions for explaining and corroborating the aforesaid amount have also not filed. Further the historic or agreed mode and manner of payment/adjustment of the aforesaid cash discount is not mentioned. The DW-1 has stated in the cross-examination dated 02.02.2018 (page 4) that the aforesaid discount is deducted in the bill. The aforesaid fact is not challenged by the Plaintiff. If the same was to be deducted from the bills, the aforesaid bills should have been mentioned and filed, from which the amount was M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 34 of 66 Civil DJ No. 609941/2016 to be deducted to show that no such deduction was made.
iii. Claim No. (iii) to (v): The claim No.(iii) to (v) are towards the sale of products by/to the other distributors and the same is claimed @ 5% of the amount of such sale. Rs. 50,000/- is being claimed towards sale of Rs. 10,00,000/- through M/s Surya Trading Company and Rs.25,000/- each are being claimed towards sale of Rs.50,000/- through M/s Jay Agency and through M/s. Jugal Kishore Vinay Kumar. The Plaintiff has not proved any right to claim the aforesaid amount arising on account of contract between the parties. Neither such contract nor its terms relevant for claiming this component are proved. Ld. Counsel for the Plaintiff has submitted that the DW-1 admits the application of the overriding commission in his cross-examination. In the cross-examination, the witness has stated about over-heading commission over annual turnover and not about the overriding commission. No further questions were asked to clarify as to whether the over-heading or over-riding commission were one and the same thing.
iv. Claim No. (vi) & (vii): Rs.93,500/- towards short supply receipt and Rs.2,42,000/- towards cost of damaged or unsellable stock in the last three years: There are no details of the material on record from which it could be inferred as to how and what quantity of material was short or damaged. The details of relevant transactions pertaining to short supply/damaged material have not been mentioned.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 35 of 66 Civil DJ No. 609941/2016 Further, if the supply was short or the material supplied was damaged, there is no communication record to infer whether the same was duly communicated to the Defendant No.1, within a reasonable time, so as to infer that the delivery of aforesaid goods have not been accepted in terms of Section 41 and 42 of the Sale of Goods Act, 1930. In absence of details of transaction and period it pertains to, the factum of such short supplies and material being damaged cannot be taken to be proved. The Plaintiff should have specifically pointed out as to which supplies were short or which material was damaged. The entitlement for the aforesaid short supplies and damaged material could be claimed only if the Plaintiff was billed for it and has made payment for the same, which is also not established.
v. Claim No.(viii): Rs.2,35,000/- towards the rate difference in the supply of "MIST Agarbathi" with that of similar no tax zone rates supplied by the Defendant in the territory also enjoying the status of no tax zone in last three years: The Plaintiff has not mentioned any further details to comprehend the claim. The basis or computation of the aforesaid claim is not stated. No comparative rates or zones are mentioned to conclude the entitlement and to compute the amount. Even the period of claim has not been mentioned. No agreement or understanding has been established on record to contractually claim the aforesaid amount.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 36 of 66 Civil DJ No. 609941/2016 vi. Claim No. (ix): Rs.2,23,000/- towards delay in responding to the certain claim made from time to time, which also includes the interest @ 24% per annum: The nature of this claim is evidently vague. The details of the claims and their specifications/amount have not been mentioned. It is not mentioned as to when the aforesaid claims were made, so as to understand the time, by which they were delayed.
vii. Claim No.(x): Rs. 28,432/-: The interest unauthorizedly charged in last one year: Nothing has been mentioned as to how and in what manner, the aforesaid interest has been charged. In case, if the same was charged and paid, such payment has not been spelled out. If the amount of such interest was deducted/adjusted from some other entitlement, no specifications have been provided.
viii. Claim No.(xi): Rs. 8,900/- towards the deduction of sum unauthorizedly made in the account of Plaintiff despite timely dispatch of the "C" form immediately after the receipt of the sale tax authority: The date, time or manner of the aforesaid deduction has not been spelled out to explain or corroborate the same.
ix. Claim No.(xii): Rs.55,084/- towards reimbursement of levies on sales tax @8% in the territory of Delhi in the period between 16.01.1999 to 31.03.2000 payable by Defendants under the terms of supply: The aforesaid deduction was claimed for sale tax applicable between the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 37 of 66 Civil DJ No. 609941/2016 transactions of particular period. The details of the total transactions have not been provided or established to understand the transaction and to explain the amount. The computation and components of the claimed amount are not established.
x. Claim No.(xiii): Rs.10,00,000/- towards loss of goodwill, reputation and injury: This head contains the claim of principal amount of damages. The Plaintiff has stated itself to be a proprietorship concern. The Plaintiff has claimed that it has succeeded to business of M/s. Jaggumal Vedprakash, which was in business for more than 35 years. The Plaintiff has not proved as to how and in what capacity it has succeeded the rights/liabilities or business of the M/s. Jaggumal Vedprakash. There is no evidence about the market worth, reputation and goodwill of M/s. Jaggumal Vedprakash and further the Plaintiff has not proved its right/entitlement to claim damages for the loss of goodwill/reputation of Ms/ Jaggumal Vedprakash. The Plaintiff has also not proved its own market worth, goodwill or reputation independently. There is nothing on record from which the aforesaid amount is explained or corroborated. No basis or benchmark for claiming the loss of goodwill or reputation has been provided. Mere termination of the contract of agency would not by itself prove the loss of goodwill and reputation. Neither the aforesaid goodwill/reputation nor its loss are established on record.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 38 of 66 Civil DJ No. 609941/2016 9.4.4. This Court has also gone through the other documents filed on record, which have not been referred to during the course of submissions and the same are as follows:
i. Letter dated 14.06.1995 (Exhibit P-15 & admitted by the Defendants): This letter is issued by the Defendant No.1 to the Plaintiff and it is mentioned in it that the Defendant No.1 would deduct trade discount/commission @ 6% with immediate effect in their bills and all other terms and conditions were the same.
ii. Letter dated 01.04.1997 (Exhibit P-16 and admitted by the Defendants): This letter is issued by the Defendant No.1 to the Plaintiff and it is stated in the same that if the Plaintiff sent advance payment along with demand draft, the Defendant No.1 could allow 2% cash discount.
iii. Letter dated 21.05.1997 (the document denied by the Defendants): This letter is issued by the Defendant No.1 to the Plaintiff. The letter points a complaint against the Plaintiff. It is further mentioned in this letter under the head of trade discount that the Defendant could not increase commission/trade discount to the Plaintiff as they had allowed maximum discount/commission to the Plaintiff than any other stockist/agent.
iv. Letter dated 21.08.1998 (Exhibit P-17 & admitted by the Defendants): This letter is issued by Defendant No.1 M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 39 of 66 Civil DJ No. 609941/2016 to the Plaintiff and it is mentioned in clause (2) that trade discount at 9% will be allowed in the bill and balance of 4% will be given at the year end, i.e., 31.03.1999, if there were no complaints of underselling.
v. Letter dated 01.10.1999: This is communication on the letter head of the Plaintiff, which is denied by the Defendant. The document is in the form of statement of claim by the Plaintiff, wherein 4% commission is claimed on the statement of first half of the year 1999-2000, in a sum of Rs.23,569/-. The mode and manner of delivery of the aforesaid document to the Defendant No.1 is not established.
Even if the above-mentioned documents are taken to have been proved and the contents of the same are read in totality, the aforesaid communications do not in themselves prove the entitlement of 14 heads of damages as mentioned in para No. 11 of the plaint. The entitlement of cash discounts is stated differently for different period in terms of the above-referred letters, which do not add any clarity to the claim of the Plaintiff. The Plaintiff has further not produced its statement of account, the relevant documents of transactions to establish the computation of the amount under different heads of its claim for damages.
9.4.5. The PW-1 has been cross-examined with regard to the above-mentioned claims and his cross-examination dated M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 40 of 66 Civil DJ No. 609941/2016 01.05.2008 is being reproduced hereinbelow:
"We maintain the books accounts of firm M/s Jaggu Mal agencies.
It is correct that I have not filed the statement of account of firm in the present suit for the period 20001-
01. (Vol.) I have however mentioned the figure in plaint. Q. Have you mentioned the sale figure of your firm from the year 2000-01 in the plaint?
A. I have not mentioned the sale figure of my firm in the plaint or in my affidavit or evidence for the year 2000-01. (Vol.) because there was no such requirement. Q. I put it to you that you have not annexed any document in the plaint related to Surya Trading, Jaya Agencies, M/s Jugal Kishore Vinay Kumar as mentioned in para 11 of affidavit.
It is correct that I have not filed any document in this respect either in the plaint or in the affidavit of evidence. It is correct that I have not annexed in my affidavit of evidence any document to show the short supply or damage goods as per my plaint for last 3 years as mentioned in para 11 of affidavit.
Q. you have not mentioned how the interest of Rs.28,432/- as mentioned in sub-Para J of Para 11 of your plaint? A I have not mentioned (Vol.) but I have the records in respect of the same.
It is correct hat I have not mentioned the rate of interest, charged either in the plaint or in affidavit of evidence but I have the records of the same. It is correct that I have not annexed any document regarding payment of sales tax of Rs.55084/- as mentioned in para 11 of my plaint either in the plaint or in the affidavit of evidence. (Vol.) it is based on policy of the company.
It is correct that no documents showing policy of the company is filed with the plaint of with the affidavit of evidence.
It is correct that I am authorized to file the present suit on behalf of the M/s Jaggu Mal Agencies.
Q. Have you filed your affidavit of evidence in this case on the basis of directions given to you by the proprietor?
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 41 of 66 Civil DJ No. 609941/2016 A. I was fully authorized to deal with this case by the proprietor and therefore I filed the affidavit. It is incorrect to suggest that this affidavit of evidence was given by proprietor to me to file in this court. The infrastructure of the Plaintiff firm is the same it was in 1968 except (Vol.) loss of business. The system and infrastructure of the plaintiff is the same even after loss of business received from the defendant earlier.
It is incorrect to suggest that figures shown by me in para 12 of my affidavit of evidence are without any basis. Q. I put it to you that defendants have never communicated at any time to you that the agency assigned to M/s Jaggu Mal Ved Prakash is subsequently granted to M/s Jaggu Mal Agencies (Sole Proprietorship firm)? A. The communications exchange between the parties show that the Defendants have treated Jaggul Mal Agencies as successor of M/s Jaggu Mal Ved Prakash."
The cross-examination of PW-1 dated 25.07.2008 is being reproduced hereinbelow:
"M/s Jaggu Mal Ved Prakash has become non-functional in the year 1990-91 but I do not remember the month. Q. Did you inform defendant about his fact? Ans. Yes. No document has been placed on record of this case to show that intimation was given to the defendant. Vol. However, there are numerous letters between the parties to show that the defendant was informed about this.
It is incorrect to suggest that I have not placed any document or letter on record to this effect as there was no such document or letter. (Vol.) Because there was not such need.
Q. Whether you informed the defendant that a new firm M/s Jaggu Mal Agencies has been constituted.
Ans. Yes.
It is incorrect that I have not placed on record of this case any such documents. (Vol.) Because we had good terms and therefore there is no need writing a formal letter to the defendant.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 42 of 66 Civil DJ No. 609941/2016 It is incorrect to suggest that I did not inform the defendant about new constitution of M/s Jaggu Mal Agencies.
I had no other agency of agarbatties except that of the plaintiff.
We did not use to maintain any register for inward goods damaged in-transit. (Vol.) We simply used to keep aside those damaged goods.
No register was maintained by us for unsold stock. No specific registered was maintained by us for inwards goods received by us.
It is incorrect to suggest that we have calculated the cost of damaged or unsalable goods without any record. It is correct that the yearly commission was fixed on the basis of annual/sales turn over.
We used to maintain register for annual turn over. It is correct that I have not mentioned the figure of turn over of sale for the year 2000-2001 in my plaint. It is incorrect to suggest that I had not kept with me the figure of sale turnover of my firm for any of the year and for that reason I have neither mentioned the same in the suit and affidavit of evidence.
Q. Is it correct to say that the cash discount is calculated on the basis of sale turnover?
Ans. It is calculated on the basis of cash payment made by us to the plaintiff along with the other. It is incorrect to suggest that we had no document in respect of order placed by us in the year 2000-01 with the defendant and that is why I have not annexed any document with the suit.
It is correct that no document in respect of payment made by us to the defendant for the year 2000-01 has been placed on record of this suit. (Vol.) However I am having the same with me.
I used to tally the order placed on defendant and goods received from the Plaintiff and used to record the same. It is correct that no such record has been placed by me on the records of the present suit."
In terms of the above-mentioned cross-examination, the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 43 of 66 Civil DJ No. 609941/2016 basis of claim of damages is not established by the PW-1. It is not sufficient for the witness to state that he could produce the documents. It is duty of the Plaintiff to file and prove the documents, such as record registers, invoices of transaction etc., which could corroborate the relevant transactions giving rise to the aforesaid claims for damages. The least the Plaintiff could do was to file the account statement maintained in the ordinary course of business and the same has also not been filed.
9.4.6. Ld. Counsel for the Plaintiff has submitted that the DW-1 has failed to produce the documents of transaction between the parties and he has taken a plea that the aforesaid records were destroyed by the Defendants. It is submitted that the aforesaid plea is not believable as the parties were litigating with each-other. It is stated that the Defendant intentionally did not file or produce the documents of transactions between the parties and there should be adverse inference against the Defendants. This Court is of the view that the principal burden of proof was upon the Plaintiff and the adverse inference in such a case can not be made sole basis for grant of damages, when the Plaintiff has failed to prove the same by affirmative evidence.
9.4.7. The Hon'ble Supreme Court of India has discussed the scope of presumption under Section 114(g) of Indian Evidence Act, 1872 , after discussing the previous judgments on subject in "Union of India (UOI) Vs. Ibrahim Uddin & Ors.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 44 of 66 Civil DJ No. 609941/2016 (17.07.2012): MANU/SC/0561/2012: 2012 INSC 288", and the relevant observations of the Hon'ble Court are being reproduced hereinbelow:
"Presumption under Section 114(g) of the Evidence Act:
6. Generally, it is the duty of the party to lead the best evidence in his possession, which could throw light on the issue in controversy and in case such material evidence is withheld, the Court may draw adverse inference under Section 114(g) of the Evidence Act notwithstanding, that the onus of proof did not lie on such party and it was not called upon to produce the said evidence. (Vide: Murugesam Pillai v. Gnana Sambandha Pandara Sannadhi, AIR 1917 PC 6;
Hiralal and Ors. v. Badkulal and Ors., MANU/SC/0004/1953 : AIR 1953 SC 225; A. Raghavamma and Anr. v. A. Chenchamma and Anr. MANU/SC/0250/1963 : AIR 1964 SC 136; The Union of India v. Mahadeolal Prabhu Dayal MANU/SC/0028/1965 : AIR 1965 SC 1755; Gopal Krishnaji Ketkar v. Mohamed Haji Latif and Ors. MANU/SC/0168/1969 : AIR 1968 SC 1413; M/s.
Bharat Heavy Electrical Ltd. v. State of U.P. and Ors. MANU/SC/0470/2003 : AIR 2003 SC 3024; Musauddin Ahmed v. State of Assam MANU/SC/1126/2009 : AIR 2010 SC 3813; and Khatri Hotels Pvt. Ltd. and Anr. v. Union of India and Anr., MANU/SC/1054/2011 : (2011) 9 SCC 126).
7. However, in Mt. Bilas Kunwar v. Desraj Ranjit Singh, AIR 1915 PC 96, a view has been expressed that it is open to a litigant to refrain from producing any document that he considers irrelevant; if the other litigant is dissatisfied, it is for him to apply for interrogatories/inspections and production of documents. If he fails to do so, neither he nor the Court at his suggestion, is entitled to draw any inference as to the contents of any such documents.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 45 of 66 Civil DJ No. 609941/2016
8. In Kamma Otukunta Ram Naidu v. Chereddy Pedda Subba Reddy and Ors. MANU/SC/0732/2003: AIR 2003 SC 3342, this Court held that all the pros and cons must be examined before drawing an adverse inference against a party. In that case the issue had been, as to whether two persons had been travelling together in the vehicle and presumption had been drawn only on the basis that the bus tickets of both the persons were not produced. This Court held that presumption could not have been drawn if other larger evidence was shown to the contrary. (See also:
Mohinder Kaur v. Kusam Anand, MANU/SC/0220/2000 : (2000) 4 SCC 214; and Takhaji Hiraji v. Thakore Kubersing Chamansing and Ors. MANU/SC/0345/2001 : AIR 2001 SC 2328).
9. In Municipal Corporation, Faridabad v. Siri Niwas AIR 2004 SC 4681, this Court has taken the view that the law laid down by this Court in Gopal Krishnaji Ketkar (supra) did not lay down any law, that in all situations the presumption in terms of Clause (g) of Section 114 of the Evidence Act must be drawn.
10. In Mahant Shri Srinivas Ramanuj Das v.
Surjanarayan Das and Anr. MANU/SC/0257/1966 : AIR 1967 SC 256, this Court held that mere withholding of documentary evidence by a party is not enough to draw adverse inference against him. The other party must ask the party in possession of such evidence to produce the same, and in case the party in possession does not produce it, adverse inference may be drawn:
It is true that the Defendant-respondent also did not call upon the Plaintiff-appellant to produce the documents whose existence was admitted by one or the other witness of the Plaintiff and that therefore, strictly speaking, no inference adverse to the Plaintiff can be drawn from his non-producing the list of documents. The Court may not be in a position to conclude from such omission that those documents would have directly established the case for the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 46 of 66 Civil DJ No. 609941/2016 Respondent. But it can take into consideration in weighing the evidence or any direct inferences from established facts that the documents might have favoured the Respondent case.
11. In Ramrati Kuer v. Dwarika Prasad Singh and Ors. MANU/SC/0288/1966 : AIR 1967 SC 1134, this Court held:
It is true that Dwarika Prasad Singh said that his father used to keep accounts. But no attempt was made on behalf of the Appellant to ask the court to order Dwarika Prasad Singh to produce the accounts. An adverse inference could only have been drawn against the Plaintiffs-respondents if the Appellant had asked the court to order them to produce accounts and they had failed to produce them after admitting that Basekhi Singh used to keep accounts. But no such prayer was made to the court, and in the circumstances no adverse inference could be drawn from the non-production of accounts. (See also: Ravi Yashwant Bhoir v. District Collector, Raigad and Ors. MANU/SC/0186/2012 : AIR 2012 SC 1339).
12. In Smt. Indira Kaur and Ors. v. Shri Sheo Lal Kapoor MANU/SC/0448/1988 : AIR 1988 SC 1074, the lower courts drew an adverse inference against the Appellant- plaintiff on the ground that the Plaintiff was not ready and willing to perform his part of the contract. The question arose as to whether the party had the means to pay. The court further held that before the adverse inference is drawn against a particular party, the conduct and diligence of the other party is also to be examined. Where a person deposed that as he had deposited the money in the Bank and the other party did not even ask as on what date and in which Bank the amount had been deposited and did not remain diligent enough, the question of drawing adverse inference against such a person for not producing the Pass Book etc. cannot be drawn.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 47 of 66 Civil DJ No. 609941/2016
13. In Mahendra L. Jain and Ors. v. Indore Development Authority and Ors., MANU/SC/0993/2004 : (2005) 1 SCC 639, this Court held that mere non-production of documents would not result in adverse inference. If a document was called for in the absence of any pleadings, the same was not relevant. An adverse inference need not necessarily be drawn only because it would be lawful to do so.
14. In Manager, R.B.I., Bangalore v. S. Mani and Ors. MANU/SC/0204/2005 : AIR 2005 SC 2179, this Court dealt with the issue wherein the Industrial Tribunal directed the employer to produce the attendance register in respect of the first party workmen. The explanation of the Appellant was that the attendance registers being very old, could not be produced. The Tribunal, however, in its award noticed the same and drew an adverse inference against the Appellants for non-production of the attendance register alone. This Court reversed the finding observing:
As noticed hereinbefore, in this case also the Respondents did not adduce any evidence whatsoever. Thus, in the facts and circumstances of the case, the Tribunal erred in drawing an adverse inference.
The initial burden of proof was on the workmen to show that they had completed 240 days of service. The Tribunal did not consider the question from that angle. It held that the burden of proof was upon the Appellant on the premise that they have failed to prove their plea of abandonment of service (See also: MANU/SC/1023/2004 : AIR 2005 SC 534; R.M. Yellatti v. Assistant Executive Engineer MANU/SC/1607/2005 : AIR 2006 SC 355; and Pratap Singh and Anr. v. State of M.P. MANU/SC/2098/2005 : AIR 2006 SC 514).
15. Order XI Code of Civil Procedure contains certain M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 48 of 66 Civil DJ No. 609941/2016 provisions with the object to save expense by obtaining information as to material facts and to obtain admission of any fact which he has to prove on any issue. Therefore, a party has a right to submit interrogatories relating to the same matter in issue. The expression "matter" means a question or issue in dispute in the action and not the thing about which such dispute arises. The object of introducing such provision is to secure all material documents and to put an end to protracted enquiry with respect to document/material in possession of the other party. In such a fact-situation, no adverse inference can be drawn against a party for non-production of a document unless notice is served and procedure is followed. Under Rule 14 of Order XI, the court is competent to direct any party to produce the document asked by the other party which is in his possession or power and relating to any material in question in such suit. Rule 15 Order XI provides for inspection of documents referred to in pleadings or affidavits. Rule 18 thereof, empowers the court to issue order for inspection. Rule 21 thereof provides for very stringent consequences for non-compliance with the order of discovery, as in view of the said provisions in case the party fails to comply with any order to answer interrogatories or for discovery or inspection of documents, he shall, if he is a Plaintiff, be liable to have his suit dismissed for want of prosecution and if he is a Defendant, to have his defence, if any, struck out and to be placed in the same position as if he had not defended, and the party interrogating or seeking discovery or inspection may apply to the court for an order to that effect. Thus, in view of the above, the suit may be dismissed for non-compliance of the aforesaid orders by the Plaintiff and the Plaintiff shall also be precluded from bringing a fresh suit on the same cause of action. Similarly, defence of the Defendant may be struck off for non-compliance of such orders.
16. Thus, in view of the above, the law on the issue can be summarised to the effect that, issue of drawing adverse inference is required to be decided by the court taking M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 49 of 66 Civil DJ No. 609941/2016 into consideration the pleadings of the parties and by deciding whether any document/evidence, withheld, has any relevance at all or omission of its production would directly establish the case of the other side. The court cannot loose sight of the fact that burden of proof is on the party which makes a factual averment? The court has to consider further as to whether the other side could file interrogatories or apply for inspection and production of the documents etc. as is required under Order XI Code of Civil Procedure. Conduct and diligence of the other party is also of paramount importance. Presumption or adverse inference for non- production of evidence is always optional and a relevant factor to be considered in the background of facts involved in the case. Existence of some other circumstances may justify non-production of such documents on some reasonable grounds. In case one party has asked the court to direct the other side to produce the document and other side failed to comply with the court's order, the court may be justified in drawing the adverse inference. All the pros and cons must be examined before the adverse inference is drawn. Such presumption is permissible, if other larger evidence is shown to the contrary.
17. In the instant case, admittedly, the Plaintiff/respondent No. 1 during the pendency of his suit had made an application before the authorities under the control of the Appellant/defendant No. 1 to make the inspection. However, he was not permitted to have any inspection. The Plaintiff/respondent No. 1 did not submit any interrogatory statement or an application for making inspection or for production of the document as provided under Order XI Code of Civil Procedure. In such a fact-situation, in view of the law referred to hereinabove, it is not permissible for the first appellate Court or the High Court to draw any adverse inference against the Appellant/defendant No. 1.
(underlining added) M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 50 of 66 Civil DJ No. 609941/2016 If the facts of the present case are examined in view of the above-referred position of law, this Court is unable to conclude that any adverse inference is to be formed against the Defendants. The burden of proof of the damages was upon the Plaintiff. It is not the case of the Plaintiff that such documents being basis of the damages were not in the Plaintiff's possession. The Plaintiff could have produced and proved the aforesaid documents for substantiating the claim of damages.
9.4.8. Therefore, the Plaintiff has failed to prove that it has incurred damages of Rs.20,27,754 or of any other amount on account of termination of the contract in question and the Issue No.4 is accordingly decided in favour of the Defendants and against the Plaintiff.
9.5. Issue No. 5: Whether there was any agreement or contract between the Defendants and Plaintiff, granting sole distribution of the Defendant's products to the Plaintiff? OPD.
9.5.1. The onus to prove the Issue No.5 is placed upon the Defendants. The Plaintiff has stated in the plaint that he was the sole distributor of the Defendant No.1 for its products in Delhi and the Defendants have disputed the aforesaid contention. Section 101 of Indian Evidence Act, 1872 deals with the burden of proof of a fact. It states that whoever M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 51 of 66 Civil DJ No. 609941/2016 desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist. It further states that when a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person. Section 102 of Indian Evidence Act, 1872 further provides that burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side. The Plaintiff has stated in the plaint that he was appointed as sole distributor of the products of the Defendant No.1 and his right to relief rests upon the proof of aforesaid fact and therefore, the burden of proof of the aforesaid fact lies upon the Plaintiff. Further the Plaintiff would fail if no evidence were to be given on either side. Therefore, the Plaintiff has to establish the Issue No.5 in affirmative first, before the same is repelled or rebutted in negative by the Defendants.
9.5.2. It is contented by the Plaintiff that M/s. Jaggumal Ved Parkash (a partnership concern) was appointed as the sole distributor of the Defendant No.1 in the year 1968 and the Plaintiff has succeeded to the aforesaid business of M/s. Jaggumal Ved Parkash, on same terms and conditions. It is stated that the transfer of business from M/s. Jaggumal Vedprakash to the Plaintiff was also confirmed in correspondences of the Defendant No.1 over a period of time.
9.5.3. The Plaintiff has not proved the factum of M/s. Jaggumal M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 52 of 66 Civil DJ No. 609941/2016 Ved Parkash being legally bound up. It has also not been proved that the Plaintiff has succeeded to the business of M/s. Jaggumal Ved Parkash. There is nothing on record to conclude about the aforesaid succession. Neither the right of the Plaintiff nor its capacity to succeed to the contract of the partnership in the capacity of being Proprietor has been proven on record. The Plaintiff has produced in his cross- examination the copy of Order dated 13.04.1998 passed by Hon'ble Lt. Governor of Delhi in Case No. 84/97-CA, i.e., Exhibit PW-1/D-5, which is an appeal under Clause 10(5) of the Delhi Edible Oil (Licenses and Control) Order, 1937. The aforesaid proceedings pertaining to cancellation of the license of the Plaintiff. M/s. Jaggumal Vedprakash was not a party to the aforesaid proceedings and on the basis of the averments of the Plaintiff, it was stated in the Order the premises of business were previously occupied by M/s. Jaggumal Vedprakash and the same has become defuct. However the aforesaid Order does not deal with winding up or succession proceedings of M/s. Jaggumal Vedprakash and therefore, is not conclusive evidence of the fact that the rights/liabilities or business of M/s. Jaggumal Vedprakash was legally acquired or succeeded to by the Plaintiff. Beyond bare averments, nothing has been explained or corroborated as to in what manner the aforesaid succession has taken place. The Plaintiff is a proprietorship concern and M/s. Jaggumal Vedprakash was a partnership. The sole proprietor of the Plaintiff was not even a partner of the aforesaid partnership. Therefore, the factum of aforesaid succession M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 53 of 66 Civil DJ No. 609941/2016 cannot be automatically concluded and required to credibly established on record. The Plaintiff has also not proved any valid assignment of contract in its favour by partnership concern and the Defendant No.1 in terms of Section 40 of the Indian Contract Act, 1872. Therefore, the contract of agency between the Plaintiff and the Defendant No.1 is not proved to be an extension or continuation of the contract between the Defendant No.1 and M/s. Jaggumal Vedprakash.
9.5.4. Though as a matter of fact, the contract between M/s.
Jaggumal Vedprakash and the Defendant No.1 and its essential terms have also not been proved on record. The PW-1 has stated in the cross-examination dated 07.02.2007 (page 2) that letter of appointment issued by the Defendant No.1 in 1968 was destroyed in fire on 07.12.1987. It is further stated that an FIR was lodged in P.S. Defence Colony in respect of fire accident in the business place. The PW-1 has produced the copy of aforesaid FIR as Exhibit PW-1/D-4 on 24.05.2007. The witness has admitted in cross- examination dated 24.05.2007 that incident of fire was not in respect of the shop situated in the area of Sadar Bazar, Delhi and was related to another business premises bearing No.49A, Kidwai Nagar, New Delhi. The factum of aforesaid loss has not been pleaded either in the plaint nor in the examination-in-chief, however is disclosed for the first time in answer to questions about the document in the cross- examination.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 54 of 66 Civil DJ No. 609941/2016 9.5.5. Even if the aforesaid loss is assumed to have been proved, the same only pertains to a contract between M/s. Jaggumal Vedprakash and the Defendant No.1. The Plaintiff has failed to prove that it has succeeded to the rights or liabilities of M/s. Jaggumal Vedprakash. The manner and capacity for such succession have not been proved. The assignment of contract between the Defendant No.1 and M/s. Jaggumal Vedprakash has also not been proved. Therefore, the Plaintiff cannot claim to be a distributor on the strength of an agreement between M/s. Jaggumal Vedprakash and the Defendant No.1.
9.5.6. The PW-1 has been cross-examined about the nature of contract between the parties. The cross-examination of the PW-1 dated 07.02.2007 is being reproduced hereinbelow:
"....... Yes. Appointment letter in respect of appointment of stockist in the defendant company was issued in 1968 but the same is not with me as it was destroyed in fire on 7th December, 1987.
An FIR was also lodged in P.S. Defence Colony in respect of the fire extinguished in my business place at the relevant time and same can be produced as and when required.
Earlier M/s Jaggu Mal Vedprakash was the partnership firm but due to some differences between the partners, the said firm became defunct and thereafter M/s Jaggu Mal Agencies came into existence which is sole proprietorship concern of my daughter- in-law.
I do possess the record whereby M/s Jaggu Mal Vedprakash was declared defunct and the same can be produced, if so, desired.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 55 of 66 Civil DJ No. 609941/2016 I think M/s Jaggu Mal Agencies was formed somewhere in month of January, 1991.
The plaintiff firm is engaged in the business of distributor in respect of entire territory of Delhi for the products "Chavi Matches from Tamilnadu". DCM edible oils under the brand names of 'Rath' and Pangath" besides consumer items.
In the year 1991 was used to deal with the products of the defendant only as a distributor within the territory of Delhi and not other products or any other agencies.
I had met Mr. Armar Nath, the representative of defendant company. He had called me at Airport where I discussed all the joints relating to future dispatches I the name of M/s Jaggu Mal Agencies, however, the said discussion wan sot reduced into writing as the he did not feel any necessity.
` I do not remember the exact date of meeting with Mr. Amarnath.
It is wrong to suggest that defendant firm never appointed plaintiff sole distributor for its products. Ques: Was there any agreement/deed of assignment whereby the erstwhile business of M/s Jaggu Mal Vedprakash had been succeeded of transferred in the name of the Plaintiff in 1991?
Ans: There was no document executed, however, it was oral understanding.
There was no condition stipulated by the defendant for transferring the erstwhile business from M/s Jaggu Mal Vedprakash to M/s Jaggu Mal Agencies (sole proprietorship concern), however, we made efforts of our own to improve the condition of the business.
Ques: Was there any assurance give to the plaintiff by the defendant that it will not be removed from the stockist of the defendant firm at any point of time. Ans: The aid type of assurance was given by the defendant firm in the year 1968 and the same remained continued till date.
The defendant firm has supplied its products to M/s Surya Trading Company, M/s Jay Agency and M/s M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 56 of 66 Civil DJ No. 609941/2016 Jugal Kishore Vinay Kumar without any intimation to the Plaintiff.
It is correct that M/s Surya Trading Company and M/s Jay Agency have been trading for the products of the defendant within the territory of Delhi.
Balaji Agarbatti Work, Sandesh Agarbatti Works and Balakrishan Perfumery Works all Bangalore based have offered to appoint the plaintiff as their distributors.
I do not have any document showing the said offers in writing but the same are discussed on the telephones.
I am not aware, if the defendant firm had the knowledge of receiving the offers from the other traders as fully detailed above.
The defendant was expected to deal with their products from the plaintiff but no written communication made in that regard.
Ques: Is it true to say that not notice was required from either side to terminate the arrangement of stockist? Ans: I deny the suggestion.
There was no stipulation of serving the notice from either side for terminating the arrangement of stockist, however, it was agreed that the arrangement of stockist would be continued. I have received the letter Ex.P1 from the defendant whereby the agency/distributorship/stockistship was terminated by the defendant.
I became aware from the notice published in the newspaper "Navbharat Sandhya Times" that M/s Jugalk Kishore Vinay Kumar has been appointed as distributors for the entire territory of Delhi, however, I do not have said cutting of newspaper but the same can be produced after procuring form the office of the Times of India. (vol.) I have purchased the same products of the defendants from M/s Jugal Kishore Vinay Kumar against the bills which can be produced.
I used to receive the distributor discount from the defendant on purchase of its products.
I have brought with me invoices dt. 26th March 1998 and 28th March 1998 issued by the defendant M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 57 of 66 Civil DJ No. 609941/2016 wherein 13% discount were given to the plaintiff and the same are taken on record which are marked Ex.PW1/D2 and Ex.PW1/D3.
I have seen the invoices (Ex.D2 and Ex.D3) from the judicial record whereby 9% discount was given by the defendants to the plaintiff on the sale of the products with the assurance to pay the balance 4% at the end of the financial year.
I have seen the letter dt. 7th May 2001 (Ex.7) from the judicial record which clearly indicate that only 9% commission shall be given against the supply. (vol.) We raised the objection by lodging the complaint with defendant company in writing."
In terms of the above-mentioned cross-examination, the PW-1 has admitted in the cross-examination that there was no written contract about the distributorship between the Plaintiff and the Defendant No.1 and the same was orally agreed upon. The PW-1 was asked whether there was an assurance from the Defendant to the Plaintiff that it would not be removed. The PW-1 states that the aforesaid assurance was given in 1968 and continued subsequently. The PW-1 further states that there was no stipulation of serving the notice of termination by either side for terminating the contract. The PW-1 further states that the Plaintiff was offered distributorship by other brands, however he was not aware if the Defendant No.1 had the knowledge about the same. There is nothing on record to conclude that the Defendant No.1 had stopped or objected to the Plaintiff applying for distributorship of other brands. Thus, if the evidence led by the Plaintiff is read alongwith the cross-
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 58 of 66 Civil DJ No. 609941/2016 examination of the PW-1, the same is hardly sufficient to conclude that the contract of distributorship was an exclusive one with the Plaintiff. The Plaintiff has only examined the manager, the sole proprietor herself has not stepped into the witness box and no reason for the same has been assigned. When the pleaded contract was on the basis of succession from the Jaaguman Vedparaksh and oral understanding between the Plaintiff and the Defendant No.1, it was imperative to examine the sole proprietor in the matter.
9.5.7. Ld. Counsel for the Plaintiff has placed his reliance upon the letter dated 21.05.1997 to submit that the status of Plaintiff being the sole distributor is confirmed by the Defendant No.1. Though the aforesaid letter is denied by the Defendants, however the letter is on the letterhead of the Defendant No.1 and bears signatures of the partner of the Defendant No.1. The letter does not confirm that the Plaintiff is the sole distributor for Delhi and it is mentioned that the Plaintiff was appointed as distributor only for Delhi and the Defendant No.1 had its own arrangements for the Haryana. Ld. Counsel for the Plaintiff has further submitted that the Defendants witnesses have also not produced the agreement between the parties for appointment of the Plaintiff. In terms of the Plaintiff's case, there was no such agreement with the Plaintiff and the agreement was with M/s. Jaggumal Vedprakash and the Plaintiff has succeeded to the aforesaid business. The burden of proof of the fact that the Plaintiff succeeded to the rights/liabilities or business of the Jaggumal M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 59 of 66 Civil DJ No. 609941/2016 Vedprakash was upon the Plaintiff and the Defendant's documents would not prove the capacity or right of the Plaintiff to succeed to the same. As discussed earlier, the Plaintiff has failed to prove its succession to the business of M/s. Jaggumal Vedprakash and the understanding about the contract of distributorship between the Plaintiff and the Defendant No.1 was oral, therefore, the agreement of M/s Jaggumal Vedprakash not produced by the Defendants would not assist the case of the Plaintiff.
9.5.8. Therefore, the Plaintiff has failed to prove that there was an agreement or contract between the Plaintiff and the Defendant No.1, whereby the Plaintiff was granted sole right of distribution of the products of the Defendant No.1. The Issue No. 6 is decided against the Plaintiff and in favour of the Defendant No.1.
9.6. Issue No. 6: Whether the Plaintiff is entitled to the interest, if so at what rate and on what amount? OPP.
9.6.1. Since the Plaintiff has failed to prove the entitlement for the damages, therefore, the Plaintiff is not entitled to any interest. The Issue No.6 is decided against the Plaintiff.
9.7. Issue No. 7: Whether the Plaintiff is entitled to a decree of permanent injunction as prayed? OPP.
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 60 of 66 Civil DJ No. 609941/2016 9.7.1. The onus to prove the Issue No.7 is upon the Plaintiff. The Plaintiff has sought permanent injunction restraining the Defendants from selling or distributing their products in the territory of Delhi through anyone else except through the Plaintiff. The Plaintiff is agent/distributor of the Defendant No.1. The Plaintiff has stated that it was the sole and exclusive distributor of the Defendant No.1 for the territory of Delhi and aforesaid contract was agreed to be continued for an indefinite period if there are no complaints about the performance of the Plaintiff.
9.7.2. In terms of Section 14(d) {previously Section 14 (c)} of the Specific Relief Act, 1963, no specific performance can be granted for a contract, if it is in its nature determinable. If a contract is not capable of being specifically enforced, then injunction cannot be granted against breach of such a contract under Section 41(e) of the Specific Relief Act, 1963. Therefore, it is required to be examined as to whether the contract in the present case is in its nature determinable.
9.7.3. It has been held by the Hon'ble High Court of Delhi in "ABP Network Private Limited vs. Malika Malhotra (12.10.2021) : MANU/DE/2762/2021: 2021/DHC:3284"
that a contract which is determinable, whether by efflux of time or at the option of either of, or both, the parties, and whether preceded by the requirement of issuance of notice or any other pre-termination formality, or not, is, therefore, to M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 61 of 66 Civil DJ No. 609941/2016 be regarded as "in its nature determinable", within the meaning of Section 14(d) of the Specific Relief Act (para 12.20 of the judgment).
9.7.4. The Hon'ble High Court of Delhi has also discussed the scope of aforesaid provision in detail in, "DLF Home Developers Limited vs. Shipra Estate Limited and Ors. (08.11.2021): MANU/DE/2977/2021: 2021/DHC/3488"
and observations relevant to facts of the present case are being reproduced hereinbelow:
"94. The question whether the contract by its very nature is determinable is required to be answered by ascertaining the nature of the contract. Contracts of agency, partnerships, contracts to provide service, employment contracts, contracts of personal service, contracts where the standards of performance are subjective, contracts that require a high degree of supervision to enforce, and contracts in perpetuity are, subject to exceptions, in their nature determinable. These contracts can be terminated by either party by a reasonable notice.
95. In addition, it is also necessary to ascertain the intention of the parties. It is important to address the question, whether the parties intended the contract to be determinable and thereby, not specifically enforceable. Plainly, if in terms of the express language of the contract, the parties have agreed that their contract will be specifically enforceable; the courts would have to assume to the said effect. This is not to say that the courts are bound to issue an injunction or specifically enforce the contract; but it would certainly require to give due consideration to the intention of the parties."
M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 62 of 66 Civil DJ No. 609941/2016 9.7.5. If the contract in the present suit is examined, the same is a contract of agency. The contract between the parties is an oral one and no terms in writing were agreed to. In terms of Issue No.6, the Plaintiff has failed to prove that it was appointed as the sole and exclusive distributor of the Defendant No.1 for territory of Delhi. The Plaintiff has not disputed that agreement/contract of agency between the parties is not a determinable one, its contention is that the aforesaid contract was not validly determined. The Plaintiff has stated that the parties have agreed to continue the contract for an indefinite period, if there are no complaints against the performance of the Plaintiff and the aforesaid averments are disputed by the Defendants. The parties in the present case have been communicating in writing. Even the supply of goods was made through written records, i.e., invoices, letters etc. No reason has been given as to why the aforesaid aspect of the contract to continue for an indefinite period was not recorded in writing if the other aspects of business were discussed through the written communications over a period of time. From the documents relied upon by the Plaintiff, it is difficult to conclude that the Defendant No.1 has orally agreed to continue the contract of agency for an indefinite period. The PW-1 has stated in the cross- examination dated 07.02.2009 (page 5) that there was no stipulation of serving any notice by either side for termination of the contract. The continuation of the contract for indefinite period was a serious and crucial condition of the contract and it is expected that the parties would adhere M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 63 of 66 Civil DJ No. 609941/2016 to some amount of formality in recording the same in the written form and about the manner of its termination, when the other aspects of the transactions between the parties are conducted in written form. The agreement being oral and the manner of informality, i.e., there being no stipulation for issuance of notice for termination, speak against the notion of the contract being one for indefinite period. Therefore, bare oral averment, denied by the Defendants, would not establish on record that the contract in the present case was agreed to be continued for an indefinite period.
9.7.6. Further such a contract for agency is a revocable contract unless the same does not fall within the purview of Section 202 of the Indian Contract Act, 1872 and becomes irrevocable. It is not the case of the Plaintiff that the contract in the present case falls within the purview of Section 202 of the Indian Contract Act, 1872. Therefore, the contract in the present case is in its nature determinable one and the Plaintiff is not entitled to the prayer of permanent injunction. The Issue No.7 is accordingly decided against the Plaintiff and in favour of the Defendants.
9.8. Issue No. 8: Whether the Plaintiff is entitled to a decree of declaration, as prayed? OPP.
9.8.1. The onus to prove the Issue No.8 is upon the Plaintiff. The Plaintiff has sought declaration of nullity with regard to letter dated 26.03.2001. In terms of the aforesaid letter, the M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 64 of 66 Civil DJ No. 609941/2016 Defendant No.1 has terminated the agreement for distributorship or agency of the Plaintiff. The Plaintiff has stated that M/s. Jaggumal Vedprakash was appointed as sole and exclusive distributor by the Defendant No.1 in the year 1968 and the Plaintiff has inherited the business of M/s. Jaggumal Vedprakash in the year 1991 on the same terms and conditions, which was also acknowledged by the Defendant No.1. The Plaintiff has failed to prove that M/s. Jaggumal Vedprakash was sole and exclusive distributor of the Defendant No.1 or that the Plaintiff had succeeded to the business of the M/s. Jaggumal Vedprakash. Though once the Plaintiff does not prove that it has succeeded to the business of the M/s. Jaggumal Vedprakash, the factum of M/s. Jaggumal Vedprakash being the sole and exclusive distributor of the Defendant No.1 is completely irrelevant to the discussion.
9.8.2. In terms of the Issue No.6, the Plaintiff has failed to prove that it was appointed as the sole and exclusive distributor of the Defendant No.1 for the territory of Delhi. In terms of the Issue No.7, it has been discussed that that the Plaintiff did not prove any agreement for continuing the contract in question for an indefinite period. Once the aforesaid agreement or term of the agreement to continue the contract for an indefinite period is not proved, the Defendant No.1 was within its right to terminate the contract and therefore, the contract was validly terminated in terms of Exhibit P-1, the letter dated 26.03.2001. Thus, the Plaintiff is not entitled M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 65 of 66 Civil DJ No. 609941/2016 to declaration of nullity against the aforesaid letter. The Issue No.8 is accordingly decided against the Plaintiff and in favour of the Defendants.
9.9. Issue No. 9: Whether the Plaintiff is entitled to a decree of rendition of account, as prayed? OPP.
9.9.1. The prayer of rendition of account is dependant upon the prayer of the entitlement of the damages. Since the Plaintiff has failed to prove the entitlement for damages, therefore, it is not entitled to prayer of the rendition of accounts. The issue No.9 is decided against the Plaintiff and in favour of the Plaintiff.
10. Final Decision/Relief:
10.1.1. The Suit of the Plaintiff is dismissed. The decree sheet be drawn up accordingly. The files be consigned to record room after due compliance.Digitally signed
by ANIL ANIL CHANDHEL CHANDHEL Date: 2026.01.13 16:31:41 +0530 Announced in the open Court (ANIL CHANDHEL) today on 13th of January, 2026 DISTRICT JUDGE -04 WEST DISTRICT TIS HAZARI COURTS DELHI 13.01.2026 M/s. Jaggu Mal Agencies Vs. Ms. B.V. Aswathiah Bros. & Ors. Page No. 66 of 66 Civil DJ No. 609941/2016