Delhi District Court
M.S. Qureshi vs M/S. H.M. Overseas on 8 February, 2013
1
In the Court of Sh. Vivek Kumar Gulia
Commercial Civil Judge cum ARC (North District)
Tis Hazari Courts, Delhi.
Suit No. 795/07
Unique I.D. No. 02401C1279012007
In the matter of :
M.S. Qureshi
Proprietor M/s. ABS Exim Consultants
4378/4B, Ansari Road,
New Delhi110002. .......... Plaintiff
Versus
1. M/s. H.M. Overseas
Chilkana Road,
Saharanpur247001, U.P.
2. Mr. Ajay Budhraja
3. Mr. Amit Budhraja
Both Partners M/s. H.M. Overseas,
Chilkana Road,
Saharanpur247001, U.P.
4. M/s. Duluxe Karan Import Pvt. Ltd.
321, Sidhi Vinayak Housing Society,
Page 1 of 13 Suit no. 795/07
2
1st Floor, Room no. 7, Hingwala Lane,
Pant Nagar, Ghat Kopar (East)
Mumbai.
Through its Managing Director
Shri Minesh Shah. ........ Defendants
SUIT FOR RECOVERY OF MONEY
Date of Institution : 14.12.2007
Final arguments heard/case reserved for Judgment : 16.01.2013
Date of Judgment : 08.02.2013
Decision : Suit Dismissed
JUDGMENT:
1. The important facts of the case, as averred in the plaint, are that the plaintiff is the sole proprietor of the firm M/s ABS Exim Consultant which is established as Exports and Imports Consultancy Services for the last several years. Further, it is mentioned that the defendant no. 1 is Government of India recognized two star export house engaged in the export of rice and sugar and defendant no. 2 & 3 are its partners. Further, it is mentioned that in the month of April/May, 2006, defendant no. 2 approached the plaintiff in his office in Delhi to arrange Page 2 of 13 Suit no. 795/07 3 indenter/supplier of the raw material under High Seas Sales Contract to utilize their import licences nos. 0510173282 to 0510173285 of the total value of Rs. one crore issued to them by the competent authorities under Target Plus Scheme. Further, it is mentioned that at the request of defendant no. 2, the plaintiff agreed to arrange suitable legal source to procure the raw material as desired by him against marginal commission of 1% on the value of the duty free four licenses, i.e., Rs. one lac. Further, it is mentioned that vide irrevocable agreement dated 02.05.2006, the defendant no. 2, on behalf of the defendant no. 1, appointed the plaintiff and authorized him as their authorized agent to operate their import licenses and to represent them in consideration of aforesaid commission. Further, it is mentioned that defendant no. 2 also agreed to pay 50% commission in advance and balance after execution of imports of defendant no. 1. Further, it is stated that thereafter, the plaintiff went to Mumbai in first week of May, 2006 to explore the legal sources for procurement of requisite raw material and in this connection he met with defendant no. 4. Further, it is stated that after studying Mumbai market, he got information that defendant no. 4 is well established importer and supplier of raw material. Further, it is mentioned that purchase rate and quality of raw material was discussed and affirmed by defendant no. 1 and defendant no. 4 in telephonic Page 3 of 13 Suit no. 795/07 4 conversation. Further, it is mentioned that the plaintiff paid a sum of Rs. 25,000/ in cash on 02.05.2006 and further Rs. 25,000/ on 22.08.2006 against commission. Further, it is mentioned that after execution of his job, the plaintiff had been requesting the defendants no. 1 to 3 to release balance commission of Rs. 50,000/ and made several telephonic calls but to no avail. Further, it is mentioned that to the utter shock and surprise of plaintiff, he received a legal notice dated 04.10.2007 whereby defendant no. 1 called upon plaintiff and defendant no. 4 to pay Rs. 1,16,20,000/ to defendant no. 1 as damages for cheating and defrauding. Further, it is mentioned that he replied the legal notice vide letter dated 18.10.2007 and requested defendant no. 1 to make balance payment of Rs. 50,000/. Further, it is mentioned that the defendants no. 1 to 3 are also liable to pay interest @ 12 % p.a. from 01.05.2006 to 15.12.2007 amounting to Rs. 9,666/ and thus, the defendants no. 1 to 3 are under debt of Rs. 59,666/ as on date of filing of suit. In view of above, plaintiff prayed for decree of Rs. 59,666/ alongwith pendente lite and future interest @ 18% p.a. against the defendants no. 1 to 3.
2. Summons were served upon all the defendants. Defendants no. 1 to 3 opted to contest the case and filed written statement to the effect Page 4 of 13 Suit no. 795/07 5 that the plaintiff has suppressed relevant facts. Further, it is mentioned that no transaction whatsoever has taken place in Delhi and no agreement dated 02.05.2006 was executed in Delhi. Further, it is mentioned that the plaintiff and defendant no. 4 have acted illegally to defraud the defendants no. 1 to 3 and Government of India and as such defendants no. 1 to 3 had to deposit a sum of Rs. 1,16,20,000/ with customs department. Further, it is mentioned that the defendants have been put to loss by plaintiff and defendant no. 4 by importing wrong goods on the license of the plaintiff. Further, it is submitted that the plaintiff approached defendants no. 1 to 3 stating that he can arrange and utilize his licenses for duty free import of P.P. Granules and its processing and therefore, he was appointed as their representative. Further, plaintiff entered into contract with defendant no.4 for import of PVC Resin and further provided wrong information to defendants no. 1 to 3 that P.P. Granules and PVC Resin falls under same family and covered under broad nexus of export products. Moreover, other contentions of the plaint were denied and prayer is made for dismissal of the suit.
3. The plaintiff filed replication to the written statement filed by defendants no.1 to 3 whereby he denied the contentions raised by the defendants and reasserted the facts mentioned in the plaint. Page 5 of 13 Suit no. 795/07 6
4. The defendant no. 4 didn't appear once and was proceeded ex parte vide order dated 13.02.2009.
5. On the basis of the pleadings of the parties, following issues were framed by Ld. Predecessor of this court vide order dated 12.05.2009:
i. Whether the plaintiff is entitled to recover the amount claimed in the plaint? OPP ii. Whether the plaintiff is entitled to recover the interest, if yes, at what rate? OPP iii. Relief.
6. Under Order 14 Rule 5 CPC, the additional issues were framed by Ld. Predecessor of this court vide order dated 02.11.2010 as follows:
1. Whether this court has no territorial jurisdiction to entertain the suit? OPD
2. Whether the suit of the plaintiff has been filed without any cause of action? OPD
3. Whether the suit of the plaintiff is bad for misjoinder? OPD
7. Plaintiff himself stepped into the witness box as PW1 and deposed on the lines of plaint. Further, he relied upon the following documents:
a) Agreement dated 02.05.2006 : Ex. PW1/1
b) Authority Letter dated 01.05.2006 : Ex. PW1/2
c) Copy of reply notice dated 18.10.2007: Ex. PW1/3
d) Postal Receipts : Ex. PW1/4 to PW1/6 Page 6 of 13 Suit no. 795/07 7
e) A.D. Cards : Ex. PW1/7 & PW1/8
f) UPC Receipts : Ex. PW1/9 & PW1/10
g) Bond Agreement dated 15.05.2006 : Ex. PW1/11
h) Notice u/o12 Rule 8 CPC : Ex. PW1/12
8. On their turn, the defendants no. 1 to 3 failed to lead any evidence and after granting sufficient opportunities, DE was ordered to be closed vide order dated 03.09.2012.
9. I have heard the arguments advanced by Ld. Counsel for the plaintiff Sh. Gajraj Singh. None appeared for defendants no. 1 to 3 for addressing arguments. For the sake of convenience, the issues have been renumbered. My issuewise findings are as under: Issue no. 1.
Whether this court has no territorial jurisdiction to entertain the suit? OPD
10. Onus of this issue was on the defendant. In their written statement, the defendants have mentioned that no transaction ever took place at Delhi and no agreement dated 02.05.2006 was executed between the parties in Delhi. However, the defendants failed to lead any evidence to substantiate this plea. On the other hand, PW1 has Page 7 of 13 Suit no. 795/07 8 categorically mentioned that all the transactions and agreement Ex. PW1/1 and Authority Letter Ex. PW1/2 were executed in Delhi. On this aspect, his testimony has stood test of crossexamination. In view of this, this issue is answered in favour of the plaintiff and against the defendants.
Issue no. 2.
Whether the suit of the plaintiff has been filed without any cause of action? OPD
11. Burden to prove this issue was on the defendants. However, the defendants have not led any evidence to prove this issue. The plaintiff has filed the present suit for recovery of his balance commission amount on the basis of Agreement Ex.PW1/1. If a plain reading is given to the plaint, it found that it discloses valid cause of action. Accordingly, this issue is answered in favour of the plaintiff and against the defendant. Issue no. 3.
Whether the suit of the plaintiff is bad for misjoinder? OPD
12. Onus of this issue was also on the defendants. In their written Page 8 of 13 Suit no. 795/07 9 statement, defendants have taken preliminary objection that defendants no. 2 & 3 are not necessary parties. Considering that firm has no separate legal identity, I am of the view that defendants no. 2 & 3, being partners of defendant no. 1 firm, are necessary parties in the present suit for recovery and therefore, the plea of defendants for misjoinder of parties is unsustainable. Accordingly, this issue is decided in favour of the plaintiff and against the defendants.
Issue no. 4.
Whether the plaintiff is entitled to recover the amount claimed in the plaint? OPP
13. Onus to prove this issue was on the plaintiff. PW1 has deposed that he was authorized as agent of defendant no. 1 firm on the basis of authority letter Ex. PW1/2 and further an agreement Ex. PW1/1 was executed between the plaintiff and defendants no. 1 to 3 whereby he was authorized to operate the import licenses of defendant no. 1 firm. Further, he has testified that he searched for an importer (defendant no.
4) in Mumbai and after discussing the purchase rate and quality of raw material with all the parties, the deal was approved by defendant no.2. Further, he has testified that he was paid half of the total commission Page 9 of 13 Suit no. 795/07 10 amount of Rs. 1 Lac by way of two installments of Rs. 25,000/ each in cash but defendant no. 1 failed to pay the remaining amount and thus, they are liable to pay it alongwith interest. During crossexamination, PW1 replied that he got defendant no. 4 introduced with defendant no.1 in 2006 and he had contacted defendant no. 4 in May, 2006 for arranging indent of the import items on behalf of the defendant no.1. Further, he replied that he cannot tell specifically as what items have been imported by defendant no. 4 on behalf of the defendant no.1, though, it was plastic packing materials. Further, he admitted that he got the items imported through defendant no. 4 on behalf of the defendant no. 1 as per policy and license. Further, he admitted that he guided defendant no. 1 as to what goods has to be imported in regard to which defendant no. 4 was introduced by him.
14. The plaintiff has relied upon authority letter Ex. PW1/2 and agreement Ex. PW1/1 executed between the plaintiff and defendant no.1. Though, the defendants no.1 to 3 have disputed both these documents, however, they have not produced any material to show that these are false and fabricated documents. As per agreement Ex. PW1/1, the plaintiff was to operate the import licenses issued to defendant no. 1 by the competent authorities on behalf of defendant no. 1 under prevailing Page 10 of 13 Suit no. 795/07 11 import and export policy. Defendants have claimed that the wrong material was imported by defendant no. 4 in collusion with the plaintiff and that is why they had to deposit a sum of Rs.1,16,20,000/ with the custom authorities. The defendants have also filed notice Ex. PW1/D1 sent to plaintiff and defendant no. 4 furnishing the details of payments made by them. The plaintiff has not disputed the receipt of this notice. In this notice, it has been clearly mentioned that team of officers of DRI Zonal Unit, Lucknow, visited the premises of defendant no.1 and informed that duty free import as well as subsequent processing of PVC Resin is not in accordance with duty free import scheme and that is why defendant no.1 was directed to deposit huge amount with government department. The plaintiff has clearly admitted that it was his duty to guide defendant no. 1 as to what goods is to be imported through defendant no.4. During crossexamination of PW1, defendants no. 1 to 3 have been able to rebut the plea of plaintiff to the effect that items were not imported on behalf of defendant no. 1 through defendant no. 4 as per prevailing import policy. Further, the plaintiff has not been able to show that specific item was imported as per prevailing import policy. Moreover, to rebut the plea of defendants, the plaintiff has not been able to establish that the custom authorities gave clearance to the items imported on the licenses of defendant no.1 under the guidance of plaintiff. Page 11 of 13 Suit no. 795/07 12
15. It can also be seen that defendants have impeached the veracity of PW1 when he replied that he had not contacted the custom authorities with respect to the processing of said licenses as it was not part of his duty though as per agreement Ex. PW1/1 he was authorized to represent defendant no.1 in respect of above licenses before custom authorities and other concerned authorities.
16. Furthermore, it is noteworthy that the plaintiff has not been able to substantiate his plea that he was paid Rs. 50,000/ in two installments in cash in May, 2006 and August, 2006 by defendant no.1. It is also noteworthy that the plaint has been filed by the plaintiff in December, 2007 after receiving legal notice Ex. PW1/D1 sent by defendant no.1 in October, 2007. Thus, plea of defendants that the present suit is counter blast to the criminal proceedings initiated by defendant no. 1 against the plaintiff and defendant no. 4 in the court of CJM, Saharanpur, cannot be overruled.
17. In view of above, it may be held that the plaintiff has failed to prove on record that the right kind of material was imported on the licenses of defendant no. 1 on the basis of agreement Ex. PW1/1 as per import policy of the government. It clearly emerges that plaintiff didn't operate Page 12 of 13 Suit no. 795/07 13 the licenses as per terms of agreement Ex. PW1/1 and it means that he didn't provide his services as per agreed terms. Therefore, the plaintiff is not entitled for any commission amount for the services provided by him to defendants no. 1 to 3. Accordingly, this issue is answered against the plaintiff and in favour of defendants no. 1 to 3.
Issue no. 5.
Whether the plaintiff is entitled to recover the interest, if yes, at what rate? OPP
18. In view of findings given in respect of issue no. 4, this issue is also decided against the plaintiff and in favour of defendants no. 1 to 3. RELIEF:
19. In the light of discussion made above, the suit filed by the plaintiff is ordered to be dismissed. No order as to costs.
Announced in open Court (Vivek Kumar Gulia) on 08 Day of February, 2013. CCJ cum ARC (North District) th [This judgment contains 13 pages.] Tis Hazari Courts, Delhi Page 13 of 13 Suit no. 795/07