Delhi District Court
Sh. Amitabh Gupta vs O.J. Securities Private Limited on 8 May, 2014
1
IN THE COURT OF SHRI KAPIL KUMAR, CIVIL
JUDGE01 (WEST) TIS HAZARI COURTS, DELHI..
Unique ID No. : 02401C0392252003
SUIT NO :264/03
Date of Institution : 29.05.2003
Date of reservation of judgment : 02.05.2014
Date of pronouncement of Judgment : 08.05.2014
Sh. Amitabh Gupta
Proprietor
Messrs Garg & Associates
D688, Saraswati Vihar
Delhi110034.
...............Plaintiff
versus
O.J. Securities Private Limited
213, IJS Palace
320, Delhi Gate Bazar
Asaf Ali Road
New Delhi110002.
............Defendant
SUIT FOR RECOVERY OF RS.2,02,840/
Suit No.264/03
2
JUDGMENT
Case of plaintiff
1. Plaintiff states that he is the proprietor of M/s Garg and Associates and has been working as a subbroker with the defendant making salepurchase of shares, debentures and other securities and has been making/receiving the payments for the same as per the terms and conditions agreed between the parties. Further states that last transaction between the parties took place on 29.6.2000 and as on date defendant owed to the plaintiff a sum of Rs.1,14,121.55/ as admitted by the defendant vide statement of account as on 31.3.2001. Plaintiff further states that while going through the statement of account issued by the defendant he found that defendant has debited the account of plaintiff with various entries amounting to Rs. 8,366.03/ which are not admitted by the plaintiff. Further states that defendant failed to give credit of sum of Rs.3500/ on account of Rs.2500/ Jindal Vijaynagar non convertible debentures. Plaintiff further states that as of now defendant is liable to pay Rs. 1,25,987.58/ alongwith interest @ 21 % p.a amounting to Rs.76,852.42/ thus totalling to Rs. 2,02,840/. Further states that legal notice dated 11.4.2003 was issued to the defendant but he refused to accept the same. Suit No.264/03 3 Thereafter the notice was served by way of UPC which was delivered to the defendant but despite that no payment has been made by the defendant and hence the present suit.
2. By virtue of present suit plaintiff is praying for the decree of sum of Rs. 2,02,840/alongwith pendente lite and future interest @ 21 % p.a against the defendant.
Case of defendant
3. The suit is resisted by the defendant by filing a written statement wherein it is stated that the suit is liable to be dismissed because alternative remedy is available to the plaintiff and as such the suit is barred U/s 41 (h) of Specific Relief Act. Further stated that suit is bad for misjoinder or nonjoinder of parties and the suit is barred with the limitation.
4. Defendant further states that as per plaintiff's version defendant has issued account statement for the financial year 19992000 showing credit balance of Rs.1,14,121.55/ whereas actually the defendant had issued the account statement for financial year 19992000 showing credit balance of Rs. 1,11,598.25/, whereas the second statement of account for the financial year 200001 shows no financial dealing which is obvious due to the reason that the debit and credit were of the same amount which makes the balance zero. Further states that Suit No.264/03 4 the statement of account filed by the plaintiff is neither signed nor attested by the authorized person of defendant company and as such the same is manipulated document. In rest of the written statement defendant denied all the contentions of plaintiff and prayed for the dismissal of present suit.
5. Vide Order dated 20.3.2013 following issues were framed :
1. Whether the plaintiff is entitled to the decree of sum of Rs. 2,02,840/ as prayed for ?
OPP.
2. Whether the plaintiff is entitled to interest, if any. If so, at what rate and for what period ? OPP.
3. Whether the suit of the plaintiff is barred by limitation ? OPD.
4. Whether the suit of the plaintiff is bad for misjoinder/nonjoinder of parties? OPD
5. Relief.
6. Plaintiff examined himself as PW1. He relied upon following documents :
" The statement of account as Ex. PW 1/A and Ex. PW 1/B; legal notice as Ex. PW 1/C; UPC receipt as Ex. PW 1/D; postal receipt as Ex. PW 1/E; original registered AD envelop Suit No.264/03 5 as Ex PW 1/F; statement of account filed by defendant as Ex. PW 1/G ( 6 pages)."
7. In defence evidence Sh. Naveen Gupta was examined as DW1. Sh. Ram Parvesh, Accountant in O.J. Financial Services Ltd. was examined as DW2. They relied upon following documents :
" Board Resolution as Ex. DW 1/1 ; account statement of the defendant's company is Ex.DW 1/ 2; statement showing details of cheques as Mark A; letter dated 11.4.2000 as Mark B; statement of account of O.J Financial Services w.e.f 01.04.1999 to 31.03.2001 as Ex. DW 2/1; account statement of M/s A.G. Stock Brokers as mark C, letter dt. 04.07.2002 as Ex. PW 1/D1."
8. I have heard arguments advanced by Ld. Counsels for parties and carefully perused the record. I have also considered written submissions filed by both the parties. Suit No.264/03 6
9. My issuewise findings are as under :
ISSUE No. 1
Whether the plaintiff is entitled to the decree of sum of Rs.2,02,840/ as prayed for ? OPP The onus to prove this issue was upon the plaintiff.
10. In the written statement defendant took very limited defence. In the written statement defendant stated that as on 31.3.2000 defendant was liable to pay Rs.1,11,598.25/ to the plaintiff and in the subsequent year there was no financial dealings between the parties. Defendant further took the objection that the statement of account filed by the plaintiff was not signed by the official of defendant company and as such the same is manipulated document. It is pertinent to mention here that in evidence by way of affidavit Ex. DW 1/A and Ex. DW 1/B many new facts were incorporated by the defendant. It is well settled law that facts beyond the pleadings cannot be read in evidence. Further no liberty of the court was carved out to amend the written statement thereby incorporating the facts which are mentioned by the defendant in evidence by way of affidavits.
11. In the written statement defendant took the plea that the suit is not maintainable due to the bar of Section 41 (h) of Suit No.264/03 7 Specific Relief Act. This objection is misconceived as the present suit is a suit for recovery and is not an injunction suit.
12. Now coming to the merits of the present case. To prove his case plaintiff examined himself as PW1. Plaintiff relied upon two statement of accounts for the period 01.4.1999 to 31.3.2000 as Ex. PW 1/A and another statement of account w.e.f 01.4.2000 to 31.3.2001 as Ex. PW 1/B. Defendant raised the question upon the authenticity of the statement of account filed by the plaintiff. In the written submissions filed on behalf of defendant it is admitted by defendant that statements of account filed by plaintiff were issued by the defendant company. DW1 deposed in crossexamination that defendant company used to give computer generated statement of account either signed or unsigned as per the instructions of the client. As the defendant itself admitted that the statement of account Ex. PW 1/A and Ex. PW 1/B were issued by it then it does not lie in the mouth of the defendant to say that Ex. PW 1/A and B are not correct. As far as the objection as to the statement of accounts not being signed or attested by the officials of defendant company is concerned, the same is not relevant in view of the admission of DW1 that at the request of the client they use to issue either signed or unsigned statement of accounts.
Suit No.264/03 8
13. In the written submissions a new objection was taken as to the issuance of Ex. PW 1/A and Ex. PW 1/B in the middle of the relevant years and as such they are not complete statement of accounts. Ex. PW 1/A and Ex. PW 1/B were placed by the plaintiff on record with the plaint. Defendant knew about these statement of accounts at the time of filing of W.S but even then no objection as to the Ex. PW 1/A and Ex. PW 1/B being incomplete documents was taken in the written statement. Arguments advanced beyond pleadings are not relevant. Even otherwise reading of Ex. PW 1/A and Ex. PW 1/B together makes it clear that these statements of account are complete. In Ex. PW 1/A, the last entry was shown on 31.3.2000 as 'Vatsa Corporation'. The balance is mentioned as credit of Rs. 1,14,121.55/. This amount is shown as opening balance of statement of account as Ex. PW 1/B. The same entry as to the balance amount of statement of account of Ex. PW 1/A as the opening balance of Ex. PW 1/B makes it clear that Ex. PW 1/A and Ex. PW 1/B are complete documents.
14. In examination in chief plaintiff also relied upon the statement of account as filed by the defendant as Ex. PW 1/G thereby admitting the contents of the same. After perusal of Ex. PW 1/A, Ex. PW 1/B , Ex. PW 1/G and Ex. DW 1/ 2 it reveals that Suit No.264/03 9 the major dispute pertains to three debit entries of Rs.1,04,351.61/ , Rs. 1,529/ and Rs. 1,906/ from the account of plaintiff.
15. Sh. Naveen Gupta who is the Director of the defendant company stepped into the witness box as DW1. He relied upon Ex. DW 1/1 as his authorization to depose as a witness. It is pertinent to mention here that DW1 not brought the minute books at the time of his examination in chief nor the same was placed on record afterward. Without looking at minute books of a company comment could not be made upon the authenticity of the resolution Ex DW 1/1. Minute books is the source of proving the resolution given by a company in favour of any person to depose as a witness. Nonfiling of minute book leads to adverse inference against the authority of DW1 to depose as a witness.
16. Further, in the statement of account filed by the plaintiff Ex. PW 1/A it is written by hand that the opening balance was Rs.2523.30/ and the credit balance was Rs.1,14,121.55/. Pertinent to mention that Ex. PW 1/B the opening balance is mentioned as Rs.1,14,121.55/ which in turn reveals that Ex. PW 1/A is correct. Now if Ex. PW 1/A be compared to the statement of account filed by the defendant, Ex. DW 1/ 2 dispute revolves around debit entry of Rs. 1,04,351.61/ in favour of O.J. Financial Services Ltd. Qua this entry Ld. Counsel for defendant Suit No.264/03 10 vehemently argued that debit entry of Rs. 1,04,351.61/ was done at the specific oral request of the plaintiff. DW1 admitted in crossexamination that O.J. Financial Services ltd. and defendant company are not sister concern rather two different companies. Fund lying in the demat account of the plaintiff was transferred to O.J. Financial Services Ltd. by defendant company. DW1 deposed in crossexamination that M/s Garg and Associates ( firm of plaintiff) might have given permission to him on the date of transfer or one day prior to that. The deposition of DW1 reveals that a person's account has been debited on the alleged oral instructions of that person and the director of the company which made that debit entry was not sure whether there was any instruction/permission from the concerned person or not . Besides this, DW1 also admitted that he has not received any letter of demand from O.J. Financial Services or any other company regarding transfer of amount lying in the account of M/s Garg Associates. From the testimony of DW 1 it transpired that the person who has transferred the amount from the account of plaintiff was not sure about the permission of the plaintiff nor he has received any demand from other company to transfer the amount but even then the amount was transferred. All these facts raises a question mark upon the debit entry of Rs.1,04,351.61/ Suit No.264/03 11 made from the account of plaintiff.
17. DW2 deposed in crossexamination that if the fund of one company is to be transferred to another company written permission is required from the person from whose account the amount is to be debited. Admittedly there was no written permission from the plaintiff to transfer the funds. The averment that the funds were transferred from the account of plaintiff on the oral request of plaintiff does not instill faith of the court. Defendant itself filed a document mark B, written by the plaintiff to defendant company requesting transfer of shares of two companies from his demat account, with the defendant company, to the demat account of Alankit Assignments. If the oral permission was sufficient then why Mark B was sought from the plaintiff to transfer shares from his account to another account? Ld. Counsel for defendant himself argued that plaintiff has written various letters to the defendant to transfer the shares from his account to another account. Now if plaintiff was giving permission in writing to transfer the shares from his account then why in the case in hand transfer of funds in favour of O.J Financial Services was done without any written permission of the plaintiff. The balance of probabilities are titled in favour of plaintiff that no oral permission was given by the plaintiff to Suit No.264/03 12 transfer the funds from his account to O.J. Financial Services Pvt. Ltd.
18. DW2 further deposed that Ex. DW 2/1 which is statement of account pertaining to period 01.4.2000 to 31.3.2001 of O.J. Financial Services Pvt. Ltd. Ex DW 2/1 was compiled by Mr. G.S.Goel , Chartered Accountant and the same has been certified by Mr. Arun Gupta, Director of O.J. Financial Services ltd. He further deposed that he does not know whether any letter of demand was written on behalf of O.J. Financial Services thereby demanding the alleged due amount from M/s Garg and Associates. He then deposed that this fact might be in the knowledge of Sh. Arun Gupta. DW2 further deposed in crossexamination that plaintiff never gave oral consent to him to debit and credit its account with O.J. Financial Services Ltd and O.J. Securities Ltd. He again deposed that this fact might have been in the knowledge of Mr. Arun Gupta, Director of O.J. Financial Services ltd. He further admits that he does not have any personal knowledge of the facts of the present case. A person who has not complied the Ex. DW 2/1 and who does not have any knowledge of the facts of the case how can prove Ex. DW 2/1? Mr. G.S. Goel, Chartered Accountant was not called as witness to prove Ex. DW 2/1 . Mr Arun Gupta, Director of O.J. Financial Services ltd. chosen no to Suit No.264/03 13 stepped into the witness box to prove Ex. DW 2/1 or to other facts which must be in his exclusive knowledge. As per Section 106 of Indian Evidence Act Mr. Arun Gupta was the best person to depose on behalf of O.J. Financial Services Ltd. Pertinent to mention that Mr Arun Gupta appeared at the time of final arguments but not came into the witness box on behalf of O.J. Financial Services. DW2 even did not know who is the proprietor of Ms. Garg & Associates, the proprietorship firm of plaintiff. He deposed that M/s Garg & Associates is the proprietorship firm of Mr. Pradeep Garg which is incorrect. In view of the above discussion, the testimony of DW2 is full of contradictions and he does not have the personal knowledge of the facts of the present suit and as such his testimony cannot be relied upon.
In view of above discussion the debit entry of Rs. 1,04,351.61 / made from the account of plaintiff was a bad entry.
19. DW1 admitted in crossexamination that as on 31.3.2002 the defendant was liable to pay a sum of Rs. 6,334.94/ to the plaintiff. He deposed that the cheque of this amount was sent to the plaintiff but plaintiff refused to accept the same. He was not able to tell when the cheque was sent to the plaintiff. He further deposed that Mr. Vinay Jain, his staff member has gone to the office of plaintiff for delivering the cheque but the same was Suit No.264/03 14 refused by the plaintiff. No copy of the cheque or original cheque has been placed on record by the defendant. Further the refusal of cheque by the plaintiff must be in the exclusive knowledge of Mr. Vinay Jain who went to office of plaintiff to give him cheque and only he could tell whether the cheque was refused by the plaintiff or not. Mr. Vinay Jain was not called as witness by the defendant. Accordingly it is prove that defendant is liable to pay Rs.6,334/ to the plaintiff.
20. DW1 further admitted that plaintiff had given a statement of around Rs.14,000/ for crediting the same in his account towards dividends etc. DW1 deposed that he replied to the plaintiff for the same. Copy of the reply not placed on record. It is also admitted by DW1 that defendant company not paid that amount to the plaintiff. By virtue of this admission defendant admitted the nonpayment of various dividends demanded by the plaintiff from the defendant company vide Ex. PW 1/D1 In view of above discussion plaintiff is liable to pay a sum of Rs.1,25,354.28/ to plaintiff.
Issue is decided in favour of plaintiff and against the defendant.
Suit No.264/03 15
21. ISSUE NO.2 Whether the plaintiff is entitled to interest, if any, if so, at what rate and for what period ? OPP.
The onus to prove this issue upon the plaintiff. Plaintiff is praying the interest @ 21 % per annum. The same is exorbitant. Interest at the rate of 8 % is fair and equitable. Plaintiff is entitled to interest at the rate of 8 % on the decreetal amount from the date of filing of the present suit till the realization of the decreetal amount.
The issue is decided in favour of plaintiff accordingly.
22. ISSUE NO.3 Whether the suit is barred by limitation ? OPD The onus to prove this issue was upon the defendant. It is averred that as per plaintiff's version the last financial entry in the statement of account filed by the plaintiff is on 31.3.2000 and the present suit filed on 04.8.2003 is time barred. In the written submissions the same plea was taken by the defendant. Pertinent to note here that the plaintiff was working as sub broker of the defendant and was maintaining a running current account with the defendant company. Vide Ex. PW 1/B i.e the statement of account w.e.f 01.4.2000 to 31.3.2001, defendant admitted the credit balance of Rs. 1,14,121.55 / in favour of Suit No.264/03 16 plaintiff. This amounts to the admission of liability by the defendant in writing and the cause of action is to be reckoned from 31.3.2001 and as such the present suit filed in the year 2003 is within limitation.
Issue is decided in favour of plaintiff and against the defendant.
ISSUE NO.4.
Whether the suit of the plaintiff is bad for mis joinder/nonjoinder of parties ? OPD The onus to prove this issue was upon the defendant. This issue was not pressed during the final arguments even then as per the mandate of Order 14 rule 2 CPC the finding on the present issue is to be given. Naked objections was taken without mentioning the name of person whose presence was required in present suit or whose presence in unnecessarily secured in suit. Objection of misjoinder or nonjoinder of parties is meritless. Accordingly the present issue is decided in favour of plaintiff and against the defendant.
24. Relief.
In view of findings on above mentioned issues the suit of the plaintiff is decreed for the sum of Rs1,25,354.28/. alongwith pendente lite and future interest @ 8 % p.a alongwith Suit No.264/03 17 costs of the suit.
Decree Sheet be prepared accordingly.
File be consigned to record room after due compliance.
Announced in the open court ( Kapil Kumar)
today on 08.05.2014 Civil Judge01 (West)/Delhi
Suit No.264/03