Delhi District Court
Cs No. 121/14 Cadtech Consultant (P) ... vs . M/S Hindustan Dorr Oliver Ltd. on 23 April, 2014
CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
IN THE COURT OF SH. NAVEEN ARORA
ADJ06: SOUTH DISTRICT: NEW DELHI
CS No : 121/14
CADtech Consultants (P) Ltd.
C668, 2nd Floor,
Kalkaji New Delhi110019. PLAINTIFF
VS
M/s Hindustan Dorr Oliver Ltd.
Room No. 509, 58, Sahyog Building,
Nehru Place, New Delhi110019. DEFENDANT
Date of hearing arguments : 16.04.2014
Date of Judgment : 23.04.2014
SUIT FOR RECOVERY OF RS. 3,62,114/ ALONGWITH PENDENTELITE INTEREST
JUDGMENT
1. As per the case of the plaintiff, the plaintiff company is engaged, interalia in sales, support, maintenance of software and training of the personnel's for operating of the unique software etc. across the country.
2. The defendant is a company limited by shares having its registered office at Mumbai and branch offices in various cites across the country including Delhi and it is engaged interalia in providing Engineer Solution, technologies and EPC installments in Liquidsolid separation application.
3. On 19.01.2008 the defendant company placed order of 3 software for mechanical design of heat exchanger for its offices at Ahmedabad, Chennai and Mumbai to the plaintiff company. On 28.01.2008 the plaintiff company 1/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
delivered the softwares at the branch office of Defendant company at 58 Sehyog Building, Nehru Place, New Delhi. The defendant company paid the total amount of Rs. 20,80,000/ ( i.e. Rs. 5,20,000/ vide a cheque no. 092009 drawn on Bank of India and Rs. 15,60,000/ through RTGS) to the plaintiff at its Delhi office and they were installed by the plaintiff company at their Ahmedabad, Mumbai and Chennai offices and maintenance for the same was also provided by the plaintiff company without any additional charge as per the terms of agreement.
4. Thereafter, for the period from February 2009 to January 2010, the defendant company approached the plaintiff for renewal of the maintenance and upgradation of the software and plaintiff company vide letter dated 04.03.2009 offered the rate of Rs. 2,34,500/ per unit i.e. Rs. 7,03,500/ for three units on which the defendant company sought from the plaintiff company a special discount for 20 % for HDO for three licenses and offered them for Rs. 5,62,800/ with condition that payment shall be made 100 % advance alongwith purchase order. The defendant company through Mr. D.R. Char and Mr. Ajay Khan Welkar negotiated the rates of the offer and finally after discussions the defendant company placed an order for renewal of AMC for Microprotol bundle D for the period 1st February 2009 to 31 January 2010 vide purchase order no. 4530002490 dated 02.05.2009 for Rs. 6,32,362/ and the defendant company request to release the payment soon. It is submitted that in the purchase order dated 02.05.2009 for Rs. 6,32,362/ and the defendant company requested to release the payment soon. In the purchase order dated 02.05.2009 the defendant company has wrongly mentioned 1 quality unit in place of 3 and the service tax was mentioned 12 % in place of 10%. Mr. Anil Mishra mentioned the errors in the said purchase order to Mr. Ajay Khanwelkar and only after clarification that the order is for three units the plaintiff company considering the old business relation and after assurance 2/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
from Mr. Ajay Khanwelkar that payment will be released soon agreed to renew the AMC. The plaintiff company issued the new releases of CDs and upgraded the Microprotol software at their offices. The plaintiff company visited the offices of the defendant company at Ahmedabad and Chennai and for Mumbai sent the CDs and thus upgraded the Microprotol software as per the agreed terms. The plaintiff company pursuant to the said purchase order and after installing the new releases of upgraded Microprotol software submitted their invoice no. AMC/20091051 dated 20.05.2009 for Rs. 6,20,768/ for payment. The defendant company did not make the payment of the invoice and kept on availing the services of the plaintiff company. That on regular follow up the plaintiff company received a cheque no. 98498 dated 10.08.2009 alongwith a letter dated 12.08.2009 from the defendant company wherein the defendants have mentioned that the purchase order dated 02.05.2009 is amended and that they are enclosing the payment of Rs. 2,58,654/ against the purchase of one Microprotol software therefore no question arises to make the payment of Rs. 6,20,768/. The said amendment was surprising as it was arbitrary and made without holding any discussion with the plaintiff company and after the plaintiff company has already updated the software of the defendant company at their three locations. Further as per the purchase order dated 02.05.2009 the plaintiff company confirmed the renewal of the AMC of defendant company to their Principals M/s EuReasearch, France and on the basis of said confirmation M/s EuResearch, France raised the invoice and the plaintiff company has already make the payment to EuResearch. The defendant company did not answer the letters of the plaintiff company and finally the plaintiff company issued a notice of demand dated 14.09.2009 through its counsel demanding to pay the balance of Rs. 3,62,114/ within a period of 7 days failing which the plaintiff will initiate legal proceedings for recovery of its duties. The defendant company replied the said notice vide its reply dated 21st Sept., 2009 and 3/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
refused to pay any amount.
5. The defendant contested the suit by filing detailed WS. It is submitted that it is the practice of any corporate to issue an amendment to its Purchase order if any mistake comes to light after the issue of the same. The same was done by the defendant after the issue of the Purchase Order dated 2nd May 2009 with the view to correct an inadvertent mistake in the Purchase Order by issuing amendment on 2nd May 2009 and thus no malafide motive can be attributed to the same. It is submitted that subsequent to receipt of the offer from the plaintiff company for renewal of AMC negotiation took but the proposal was never accepted and there was no concluded contract between the parties and when purchase order dated 02.05.2009 was issued due to inadvertent mistake the price of one license was mentioned as Rs. 5,62,800/ instead of Rs. 2,58,654/. It is submitted that it was later when plaintiff started reminding the defendant for payment of renewal of AMC the plaintiff attention was drawn to the quantity mentioned on the purchase order as 1 and not 3. it is submitted that plaintiff company on his own without the consent and knowledge of defendant company upgraded the software at Chennai office because the plaintiff's companies official has developed friendly relation with the officials of defendant's Chennai Office. It is submitted the software installed at Mumbai office is of an order version and the CDs send for the upgradation of the same was not utilized and was returned to the plaintiff alongwith its letter dated 21.09.2009. It was denied that plaintiff installed the software at three locations, though it was admitted the plaintiff company submitted their invoice no. AMC /20091051 dated 29.05.2009 for Rs. 6,20,768/. It is submitted that plaintiff should have approached the defendant for clarifications with respect to anomaly in the purchase order dated 02.05.2009. It is submitted that no CD was received for defendant's Mumbai office. It is submitted that defendants are not using the unauthorized version 4/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
in their Mumbai office, on the abovementioned ground prayed for dismissal of the suit.
6. Replication was filed to the WS stating that defendant company installed all three softwares at their Ahmedabad, Chennai and Mumbai offices on 28.01.2008 through plaintiff company. It is submitted that after three months of the delivery and upgradation of the software in the year 2009 the defendant company issued the amendment letter dated 12.08.2009 with ulterior motive to take undue advantage. It is submitted that it is beyond anyones imagination that defendant company only go for maintenance and upgradation of one software only when they have three units. The contents of the WS were denied and the contents of the plaint were reaffirmed.
7. The admission denial of documents were carried out by both the parties and following documents were considered for admission or denial of documents:
Sl. No. Documents Relied Admitted/ denied Exhibited as upon by 1 Board Resolution Plaintiff Denied by defendant authorising Mr. Anil Mishra
2. Delivery challan dated Plaintiff Admitted by defendant Ex.P1 28.01.2008
3. Letter dated 04.03.2009 Plaintiff Admitted by defendant Ex.P2
4. Purchase order dated Both Admitted by both Ex.P3 and 02.05.2009 parties parties Ex.D1
5. Letter dated 04.05.2009 Plaintiff Admitted by defendant Ex.P4
6. Email dated 24.06.2009 Both Admitted by both Ex.P5 and parties parties Ex.D2
7. Email dated 01.07.2009 Plaintiff Denied
8. Email dated 08.08.2009 Both Admitted by both Ex.P6 and parties parties Ex.D3
9. Email dated 12.08.2009 Plaintiff Admitted by defendant Ex.P7 5/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
and contents denied by plaintiff
10. Letter dated 11.08.2009 Plaintiff Receipt admitted and content denied by defendant
11. Letter dated 12.08.2009 Plaintiff Admitted by defendant Ex.P8
12. Letter dated 14.08.2009 Plaintiff Admitted by defendant Ex.P9
13. Letter dated 18.08.2009 Plaintiff Receipt admitted and content denied by defendant 14 Amended purchase Deft. Denied order dated 02.05.2009
15. Letter dated 01.09.2009 Deft. Receipt admitted and content denied by the plaintiff
8. From the pleading of the parties, the following issues were framed :
(1) Whether the defendant issued amended purchase order dated 02.05.2009 after inadvertent mistake in original purchase order dated 02.05.2009? OPD (2) Whether the defendant gave amended purchase order on 12.08.2009 after about 3 months of delivery of software and upgrade of defendant's units and submission of bills by the plaintiff on 20.05.2009? OPP (3) Whether the plaintiff is entitled for money decree of Rs. 3,62,114/ against the defendant? OPP (4) Whether the plaintiff is entitled for interest @ 18% per annum, pendentlite and future interest? OPP (5) Relief.
9. In plaintiff's evidence Sh. Anil Mishra has examined himself as PW1, who filed his affidavit in his examination in chief reiterating the contents of the plaint and relied upon following documents: 6/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
Sl. Documents relied Exhibited Inference
no. upon as
1 Copy of Board PW1/1 Vide which Sh. Anil Mishra was
Resolution dated authorized to file this case and to
01.10.2009 depose on behalf of company.
2 Original copy of the PW1/2 With respect to the delivery of
delivery challan dated software initially
28.01.08 duly received already P1
by the defendant
company
3 Copy of the letter dated PW1/3 Vide this letter an offer was made by
04.03.2009 on the terms the plaintiff company to defendant
and conditions and the already P2 company for renewal of the AMC for
price of the AMC for the period of 1st February 2009 to
Microprotol software 31st January 2010. in this letter the price of three licenses were coated as Rs. 7,03,500/ and after giving discount it came to Rs. 5,62,800/ plus service tax @ 12.36% extra. The payment was to be made in advance with purchase order.
4. Original copy of the PW1/4 In this purchase order quantity was purchase order dated mentioned as 1 but the price was 02.05.2009 already P3 mentioned as Rs. 5,62,800/ plus service tax and ECESS which comes to Rs. 6,32,362/ and 100 % payments in advance was promised.
5. Original copy of letter PW1/5 It bears the acknowledgment of dated 04.05.2009 by the receipt of CDs.
plaintiff company already P4 intimating the dispatch of the upgraded version of CDs
6. Original copy of the PW1/6 It mentions the amount payable as service invoice dated Rs. 6,20,768/.
20.05.2009 issued by plaintiff to the defendant for payment
7. Copy of the letter /e PW1/7 Vide this letter was it informed by 7/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
mail dated 24.06.2009 PW2 that he would come to written by PW2 to Sajit already P5 Ahmedabad from 25 to 27 June 2009 Patel of defendant and D2 and he would like to visit the company defendant on 27.06.2009 for update of the software and to would provide up brief training.
8. Copy of proof of PW1/8 payment to
EuResearch, France for
AMC
9. Copy of letter dated PW1/9 Vide this letter payment of Rs.
11.08.2009 written by receipt of 6,20,768/ was demanded as the plaintiff/PW1 to the the plaintiff had to make further defendant Mumbai document payment to EuResarch office is admitted
10. Copy of the cheque and PW1/10 Vide this letter cheque of Rs.
amended purchase 2,58,654/ for AMC of the software
order alognwith letter installed at Ahmedabad factory of
dated 12.08.2009 defendant.
11. Original copy of letter PW1/11 Vide this letter the new release of
dated 14.08.2009 and the software i.e. June 2009 was sent
acknowledgment of already P9 to the Chennai office of defendant
receipt of CD's at which was received by the
Chennai office of defendant.
Defendant
12. Copy of letter dated PW1/12 Vide this letter the balance payment
18.08.2009 sent by the receipt of was asked.
plaintiff company the
alongwith proof of document
dispatch is admitted
communicating the by
defendant company defendant
that the amendment is
not acceptable
13. Copy of the legal notice PW1/13
dated 14.09.2009
alongwith proof of
dispatch
8/14
CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
14. Reply of demand notice PW1/14
dated 21.09.2009 by the
defendant company
9. During the cross examination, the witness remained stick to his stand though he stated that they did not installed the software update in Mumbai, though the CD was sent on 01.07.2009.
10. Plaintiff examined Sh. Jochen Joseph as PW2, who filed his affidavit in examination in chief and relied upon the documents Ex.PW1/3, Ex.PW1/5, Ex.PW1/7 and Ex.PW1/10. During his cross examination, he remained stick to his stand. Thereafter, plaintiff's evidence was closed.
11. In defendant's evidence, Sh. S.K. Mathur was examined as DW1, who filed his affidavit in his examination in chief. He also stated in his affidavit in para no. 11 that plaintiff installed new version of the updated software at three locations of the defendant company. He relied up following documents :
Sl. Documents relied upon Exhibited as Inference NO.
1 Original purchase order dated Ex.DW1/1 already 02.05.2009 exhibited as P3, D1 and Ex.PW1/3 2 Letter dated 25.06.2009 Ex.DW1/2 already exhibited as P5, D2, Ex.PW1/7 3 Letter dated 08.08.2009 written Ex.DW1/3 already In this letter some by PW2 to Sajit Patel to exhibited as D3 procedure has been Defendant company explained regarding customized templates for bill of material preparation 4 Letter dated 12.08.2009 Ex.DW1/4 already exhibited as P8 and Ex.PW1/10 5 Amended purchase order Ex.DW1/5 Admittedly this 9/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
document was issued on 12.08.2009 i.e. after three months of original purchase order 6 Reply to the legal notice issued Ex.DW1/6 already Receipt of the reply is by the defendant on 01.09.2009 exhibited as PW1/14 not disputed
12. During his cross examination, he admitted that software were installed at Ahmedabad, Mumbai and Chennai by plaintiff before 10th August 2009, though he denied that software was upgraded before 10.10.2009. He stated that it is correct that he does not have personal knowledge regarding installation and upgradation of software as it was not concerning to him because he sits in NOIDA office, where software was not installed. He stated that persons dealing with plaintiff company on behalf of defendant company Mr. Ajay Khanwelkar and Mr. D.R. Char resigned for the defendant company on October and December 2012 respectively. He stated that Mr. S.C. Shekharan is still in the company.
I have heard the arguments and perused the record. My issue wise findings are as follows:
(1) Whether the defendant issued amended purchase order dated 02.05.2009 after inadvertent mistake in original purchase order dated 02.05.2009? OPD The burden of proving this issued was upon the defendant. In para 2 of preliminary submissions of WS, it was mentioned by the defendant that "it is submitted that it is the practice of any corporate to issue an amendment to its purchase order if any mistake comes to light, after the issue of the same. The same was done by the defendant after the issue of the purchase order dated 02.05.2009 with the view to correct an inadvertent mistake in the purchase order by issuing amendment on 02.05.2009 and thus no malafide 10/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
motive can be attributed to the same."
As per defendant they had issued the amended order on 02.05.2009 but no evidence was led in this behalf to show that any such amended order was served upon plaintiff on 02.05.2009. During cross examination of PW1, it was clarified by the witness while answering to the suggestion that letter dated 12.08.2009 was received by them and that is how the plaintiff was aware of the amended order at the time when letter dated 14.08.2009 Ex.PW1/11 was issued by them. Another suggestion was given that the said letter was accompanying amended purchase order also as a reminder to them. Meaning thereby the defendant admits that the amended purchase order was sent with the letter dated 12.08.2009 i.e. Ex.PW1/10. It is also pertinent to mention here that the defendant never mentioned about the amended order in any of their letter or reply issued to the letters to the plaintiff company such as letter dated 24.06.2009 Ex.PW1/7, letter dated 08.08.2009, letter dated 11.08.2009 which clearly shows that no amended order was issued prior to these letters and it was mentioned for the first time in the letter of the defendant dated 12.08.2009 i.e. Ex.PW1/10 which clearly shows that this amended order was prepared at the first time on 12.08.2009 in order to cover up the mistake committed by the defendant company bonafidely or malafidely. It is pertinent to mention here the defendant failed to allege and prove that by which mode such as fax, E mail, postal letter, phone call, the alleged amended order was served upon the plaintiff. Had it been served on 02.05.2009 then there was no occasion for the plaintiff to purchase three softwares for the defendant company from the supplier. Hence, I am of the opinion that the defendant has failed to prove on record, that amended order was issued on 02.05.2009 as alleged in the WS. (2) Whether the defendant gave amended purchase order on 12.08.2009 after about 3 months of delivery of software and upgrade of defendant's units and submission of bills by the plaintiff on 11/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
20.05.2009? OPP The burden of proving this issue was upon the plaintiff. In view of the decision of issue no. 1 this issue stands decided in favour of plaintiff. (3) Whether the plaintiff is entitled for money decree of Rs. 3,62,114/ against the defendant? OPP The burden of proving this issued was upon the plaintiff. It is an admitted position that the purchase order dated 02.05.2009 was mentioning Quantity - Unit Price Amount 1.000 AU 5,62,800/ 5,62,800/ As per plaintiff on seeing the price of the commodity they supplied three CD for upgradation in terms of their quotation. Though, on the other hand it is the case of the defendant he inadvertent mentioned the price as Rs. 5,62,800/ instead of 2,34,500/ and the quantity was rightly mentioned as 1. It is pertinent to mention here that it is quite normal to commit mistake while typing but it is important to note that in normal circumstances what would be taken/ accepted as an error, error in one letter mentioned at one place or error in six letters which are mentioned at five places on the said order. To my mind, in normal circumstances if everything else is right then error in one letter would be taken /accepted as a mistake. It is not expected from the plaintiff that he would presumed that quantity has been mentioned rightly and amount mentioned at five places have been mentioned wrongly and every calculation of tax and cess on the said price had also been typed wrongly. In normal circumstances, in my opinion the plaintiff was right in presuming that the order is for three softwares even if he would have noticed that error in the quantity to presume that it has been mentioned by mistake. Hence, I am of the opinion that there was no default on the part of the plaintiff to seek clarification from the defendant about the quantity demanded. Even otherwise, it has not come on record anywhere that plaintiff ever noticed this 12/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
anomaly. It is also an admitted fact that all these software for upgradation were received by the defendant at their different location and they were installed by the plaintiff at defendant's Chennai and Ahmedabad offices and only at Mumbai the software was not installed by the plaintiff. Though, DW1 in his own affidavit stated that all the software were installed in all the three offices. It is argued on behalf of plaintiff that the software can be installed by the official of the defendant company also as they are self guiding and anyone who is having the basic knowledge of the computer can install the same by going through the manual and it is possible that defendant officials might have installed the software in their Mumbai office. It is argued on behalf of the plaintiff that there is a possibility the defendant might have thought to use one software at their three sites with the help of some computer expert as it is not uncommon that people use the software on multiple machines /computers in violation of the terms and condition of the license to save money by violating the law that is why breaching the pass codes provided in the software normally. It is argued on behalf of plaintiff that it is quite unbelievable that a company who bought three softwares for their three sites would go for updating of only one software leaving behind the two working on old version. It is argued that it seems that defendant intentions got malafide on receipt of the three update softwares.
It is an admitted position that despite all the correspondence between the parties the defendant company never clarified the position to the plaintiff anytime prior to 12.08.2009 and hence plaintiff company cannot be made to suffer because of the default on the part of the defendant. Hence, this issue is decided in favour of the plaintiff and against the defendant's. (4) Whether the plaintiff is entitled for interest @ 18% per annum, pendentlite and future interest? OPP In view of decision of abovementioned issues, I am of the opinion that 13/14 CS No. 121/14 CADtech Consultant (P) Ltd. vs. M/s Hindustan Dorr Oliver Ltd.
ends of justice would meet it an interest @ 12 % per annum is granted to the plaintiff on the suit amount.
(5) Relief.
In view of decision of issue, defendant no. 1 company is liable to pay amount of Rs. 3,62,114/ alongwith future and pendentelite interest @ 12% p.a. to the plaintiff. Cost of the suit is also awarded in favour of plaintiff. Decree sheet be prepared accordingly. File be consigned to Record Room.
Announced in Open Court (NAVEEN ARORA)
on 23.04.2014 ADJ06: South: Saket
New Delhi, 23.04.2014
14/14