Bangalore District Court
M/S.Mccreade Software vs M/S.Trident Techlabs Private on 19 September, 2016
IN THE COURT OF THE XXX ADDL.CITY CIVIL & SESSIONS
JUDGE, BANGALORE CITY
DATED THIS THE 19th DAY OF SEPTEMBER 2016
-: PRESENT: -
SRI.M.G.KUDAVAKKALIGER, B,Com., LL.M.,
XXX Addl.City Civil & Sessions Judge,
Bangalore.
O.S.NO.3132/2013
PLAINTIFF M/s.MCCREADE SOFTWARE
(ASIA) PRIVTE LIMITED,
A company registered under the
Companies Act 1956, having its
Business at registered office at
No.811, 23rd Main, 12th "A" Cross,
2nd Phase, J.P.Nagar,
Bengaluru - 560 078.
Represented by its Director
M/s.Soundarya Raghu/
(By Pleader Sri.H.T.Nataraj,
Advocate)
/VS/
DEFENDANTS 1. M/s.Trident Techlabs Private
Limited, White House,No.1/18-
20, Rani Jhansi Road, A-19,
Saraswathi Garden, Ramesh
Nagar, New Delhi- 110 015.
Represented by its Managing
Director Sri.Praveen Kapoor.
2 O.S.No.3132/2013
2. Sri.Praveen Kapoor,
S/o.Sri.S.R.Kapoor, Major,
Managing Director,
M/s.Trident techlabs Private
Limited, White House,No.1/18-
20, Rani Jhansi Road, A-19,
Saraswathi Garden, Ramesh
Nagar, New Delhi- 110 015.
3. Sri.Sukesh Naithani,
S/o.Late S.P.Naithani, Major,
Director,
M/s.Trident techlabs Private
Limited, White House,No.1/18-
20, Rani Jhansi Road, A-19,
Saraswathi Garden, Ramesh
Nagar, New Delhi- 110 015.
4. Sri.Sarad Chandra Naithani,
S/o.Sathya PrasadNaithani,
Major, Director,
M/s.Trident techlabs Private
Limited, White House,No.1/18-
20, Rani Jhansi Road, A-19,
Saraswathi Garden, Ramesh
Nagar, New Delhi- 110 015.
5. M/s.Trident Techlabs Pvt Ltd.,
No.1133, Anand Embassy,
Above Food World,
Indiranagar, 100 Feet Road,
Bengaluru - 560 038.
Represented by its Managing
Director Sri.Praveen Kapoor.
(By Pleader Sri.B.Roopesha,
Advocate)
****
3 O.S.No.3132/2013
DATE OF INSTITUTION 22.04.2013
NATURE OF THE SUIT (Suit on Suit for money
Pronote, Suit for declaration and recovery
Possession, Suit for injunction, etc.)
DATE OF THE COMMENCEMENT 12.01.2015
OF RECORDING OF THE EVIDENCE
DATE ON WHICH THE JUDGEMENT 19.09.2016
WAS PRONOUNCED
TOTAL DURATION : YEAR/S MONTH/S DAY/S
3 4 27
(M.G.KUDAVAKKALIGER),
XXX ADDL.CITY CIVIL &
SESSIONS JUDGE, BENGALURU.
4 O.S.No.3132/2013
JUDGEMENT
1. The plaintiff has filed this suit against the defendants for recovery of Rs.8,70,000/- together with interest at the rate of 18% p.a. on the principal amount from the date of suit till realization and costs.
2. The following are the brief facts leading to the case of the plaintiff:
That the plaintiff is a private limited company registered under the Companies Act 1956. The defendant company have desired the services of the plaintiff company in order to source a suitable candidate as per the defendant company specification and pursuant to the offer and acceptance, a placement agreement dtd.11-11-2009 has been duly executed between plaintiff company and defendant company at Bengaluru and ever since the date of inception of the agreement, the plaintiff company have been performing their part of duty in organizing the candidates as per the specification of the defendant company and the defendant company has agreed to pay the consultation fees to the plaintiff 5 O.S.No.3132/2013 and till today the plaintiff company is carrying out their part of agreement. Despite performing and fulfilling all the obligations by the plaintiff company, the defendant company has not paid the outstanding amount towards consultation charges. The plaintiff company has raised their 26 invoices on different dates as mentioned in plaint para No.3 amounting to Rs.6,61,415/-. Despite repeated requests and demands, the defendant company have utterly failed to discharge their outstanding amount and have failed to perform their part of obligation under the placement agreement dtd.11-11-2009 and plaintiff company have made several representations and also a letter dtd.30-3-2012 requesting the defendant to pay the outstanding dues of Rs.6,61,415/-, but the defendant company failed to make payment of the same and without any reasons withhold the said amount. As per the statement of accounts of the defendant company, they themselves have agreed to pay the said outstanding amount and thereby deducted TDS amount towards major portions of the said invoices and hence, they are liable to pay Rs.6,61,415/-, but the defendant company has not paid any amount. Hence, plaintiff company got issued legal 6 O.S.No.3132/2013 notice dtd.22-8-2012 and 28-8-2012. But, defendant company has issued a false reply and not complied the demand. The defendants are also liable to pay interest at the rate of 18% p.a. on the outstanding amount as per the contract or the agreed rate as per each invoice. The plaintiff claimed that, as on the date of suit, the defendants are liable to pay Rs.6,61,415/- towards the principal amount, Rs.2,03,585/- towards interest at 18% p.a. from the due date to 19-4-2013 and Rs.5,000/- towards misc.charges, totally Rs.8,70,000/-. Hence, the plaintiff has constrained to file this suit for recovery of said amount and prayed to decree the suit.
3. After registration of the suit, suit summons were issued to the defendants. Defendants have put appearance through their advocate. Defendants 1, 2 & 5 have filed the written statement contending inter-alia that the suit filed by the plaintiff is not maintainable either in law or on facts and liable to be dismissed in limine. The defendants averred that the suit is liable to be dismissed for mis-joinder and non-joiner of parties though plaintiff claims its alleged right under the alleged placement 7 O.S.No.3132/2013 agreement dtd.11-11-2009, has not made executants of the agreement as party to the above suit. The defendants are not parties to the alleged placement agreement and hence, they are not liable to pay any alleged amount as claimed by the plaintiff. These defendants have not aware of any agreement and have not authorized any person to enter into any agreement, hence, if plaintiff claims any rights under alleged agreement the parties to the above agreement are personally responsible for the same. Hence, prays to dismiss the suit. As per clause 12 of the alleged agreement, the agreement will be existence only for the period of one year from 11-11-2009 to 11-11-2010, thereafter it was extended by mutual consent. The plaintiff has not produced a scrap of paper to show that the agreement was mutually consented for subsequent years. In para-3 of the plaint, the plaintiff is claiming his alleged service charges for subsequent years. The plaintiff company has no locus-standi to maintain the suit for the subsequent years. The defendants have suitably replied to the notice issued by the plaintiff. The defendants contended that there is absolutely no cause of action for the plaintiff to file the suit. The suit is not properly valued and the 8 O.S.No.3132/2013 Court fee paid by plaintiff is not correct. The suit is misconceived, frivolous in nature and hence, it is liable to be dismissed with exemplary costs. Hence, it is requested to dismiss the suit with costs.
4. On the basis of the rival contentions taken up by respective parties in the above pleadings, the following issues have been framed by my Learned Predecessor in office for disposal of the case:
1. Whether plaintiff proves that as per the placement agreement dtd:11-11-2009 it has provided the suitable candidate to defendant No.1 company but failed to pay the consultation fees as per the agreement?
2. Whether it further proves that defendant No.1 is liable to pay outstanding amount of Rs.6,61,415/- under invoices from 22/09/2010 to 15-12-2011 and failed to pay the said amount inspite of request demands and issuance of letter on 30-03-2012 and legal notice on 22-8-
2012 and 28-08-2012?
3. Whether it further proves that it has entitled for claim amount of Rs.8,70,000/-with interest of 18% per annum?
4. What order or decree?
9 O.S.No.3132/2013
5. In order to substantiate the case made out by the plaintiff, the General Power of Attorney Holder of the plaintiff company has entered into the witness box and has filed his affidavit evidence under Order 18 Rule 4 of C.P.C. as per P.W.1 and got marked as many as 73 documents as per Ex.P.1 to P.73 and respective portions. The authorized representative of defendant company has filed his affidavit evidence as per D.W.1 and got marked as many as 10 documents as per Ex.D1 to D.10. Case posted for arguments.
6. I have heard the arguments on both side and perused the materials placed on record.
7. On the basis of the evidence both oral and documentary and other materials., I record my findings to the above issues as follows:
Issue No.1: In the affirmative.
Issue No.2: In the affirmative.
Issue No.3: Partly in the affirmative. Issue No.4: As per the final order for the following:10 O.S.No.3132/2013
REASONS
8. ISSUE NOS.1 TO 3: As Issue Nos.1 to 3 are interlinked, discussion on one issue has its direct bearing on the discussion on another issue. In view to avoid repetition of discussion and facts of evidence, I am going to consider all these issues jointly.
9. It is the brief case of the plaintiff that plaintiff is a private limited company registered under the Companies Act 1956 performing the duties in organizing the candidates to the various companies as per their specifications and used to receive consultation fees for the same. The defendant company has desired to have the services of the plaintiff company to source a suitable candidate as per their specification and pursuant to the offer and acceptance, a placement agreement dtd.11-11-2009 has been duly executed between plaintiff company and defendant company at Bengaluru. As per the terms of the agreement the plaintiff company has to source the candidates as per the specification provided by the defendant company and brief the candidates on the positions, schedule and co-ordinate the interviews, conduct the initial screening as per 11 O.S.No.3132/2013 the requirements of defendant company and the candidates will be valid for 3 months from the date of receiving the resume and defendant company is liable to pay the consulting fees at the rate of 8.33% of annual gross salary (fixed part of CTC) to the plaintiff company. In case, candidates leaves the client within 3 months of the joining date due to their personal reasons, the plaintiff company will find a suitable replacement for the said candidates. However, the plaintiff company will not be responsible to replacement if the candidate is not found suitable to the defendant company after his joining. The payment will be made within 45 days from the date of candidates training. As per Clause 12 of the said agreement, the contract between plaintiff and defendant company was for a period of one year from the date of this agreement and will be renewable on mutual consent. As per clause 13, the validity of this contract between plaintiff and defendant company can be terminated with one month written notice, in case either of the parties are not interested to carry forward the service, after due payments and services are cleared. Now, as per the plaintiff, the plaintiff company has sourced the candidates till 12 O.S.No.3132/2013 the end of 2012 and briefed the candidates, the candidates as per the specification of the defendant company. But, defendant company has not paid the consulting fees pertaining to 26 candidates from 11-8-2010 to 15-12-2011 at the rate of 8.33% of annual gross salary worth Rs.6,61,415/-(this claim amount includes the TDS amount of 10% to be deductable in the final bill). The plaintiff now claims Rs.,6,61,415/- with 18% interest and costs. Pursuant to the suit summons, the defendants 1, 2 & 5 appeared through their counsel and filed their common written statement and prayed to dismiss the suit for misjoinder and non-joinder of necessary parties and contended that these defendants are not parties to the alleged placement agreement. Hence, these defendants are no way connected to the plaintiff's claim and expressed their ignorance about the alleged agreement. Defendants further contended that the alleged placement agreement dtd.11-11-2009 will be existed for a period of one year only from 11-11-2009 to 11-11-2010 and the claim made by the plaintiff is subsequent to the said agreement. Hence, prayed to dismiss the suit as the averments are 13 O.S.No.3132/2013 baseless, created for the purpose of the case by concealing the true facts and hence, calls for the strict proof of the same.
10. On the basis of these rival contentions of the respective parties, my predecessor has framed issue No.1 placing the burden on the plaintiff to prove that as per placement agreement dtd.11-11-2009, it has provided suitable candidates to the defendant No.1 company and failed to pay the consultation fees as per the agreement. In order to substantiate the case made out by the plaintiff, GPA holder of the plaintiff company has entered into witness box and filed his affidavit evidence and deposed on par with the plaint averments and got marked as many as 73 documents as per Ex.P.1 to P.73. Out of which, Ex.P.3 is the original Placement Agreement filed before this Court which was signed by the authorized signatories of the plaintiff company as well as the defendant company M/s.Trident Tech Labs pvt.Ltd., Bengaluru. The authorised representative by name Sri.Jorg Anil D'silva of the defendant company has entered into witness box filed his affidavit evidence as per D.W.1. D.W.1 in his affidavit evidence 14 O.S.No.3132/2013 at para No.2 has admitted the execution of the Placement agreement dtd.11-11-2009 as under:
"I submit that the 5th defendant herein has entered into Placement Agreement with the plaintiff company on 11-11-2009, wherein the plaintiff company agreed to provide candidates as per the requirement of our company. As per the Placement Agreement the candidates provided by the plaintiff company should work for a minimum period of 3 months as per the Clause-5 of the agreement. If candidates fulfills all the terms of the Placement Agreement than our company has agreed to pay consulting fee at the rate of 8.33% of the Annual Gross of the candidates salary".
11. Ever since the date of inception of the agreement, the plaintiff company have been performing their part of duty in organizing the candidates as per the specification of the defendant company and the defendant company has agreed to pay the consultation fees to the plaintiff and till today the plaintiff company is carrying out their part of agreement. Despite performing and fulfilling all the obligations by the plaintiff company, the defendant company has not paid the outstanding amount towards consultation charges. The plaintiff company has raised their 26 invoices on different dates as mentioned in plaint para No.3 amounting to Rs.6,61,415/-. Despite repeated requests and demands, the defendant company have utterly failed to discharge their outstanding amount and have failed to 15 O.S.No.3132/2013 perform their part of obligation under the placement agreement dtd.11-11-2009 and plaintiff company have made several representations and also a letter dtd.30-3-2012 requesting the defendant to pay the outstanding dues of Rs.6,61,415/-, but the defendant company failed to make payment of the same and without any reasons withhold the said amount. As per the statement of accounts of the defendant company, they themselves have agreed to pay the said outstanding amount and thereby deducted TDS amount towards major portions of the said invoices and hence, they are liable to pay Rs.6,61,415/-, but the defendant company has not paid any amount. Hence, plaintiff company got issued legal notice dtd.22-8-2012 and 28- 8-2012. But, plaintiff has further averred, defendant company has issued a false reply and not complied the demand. The defendants are also liable to pay interest at the rate of 18% p.a. on the outstanding amount as per the contract or the agreed rate as per each invoice. As on the date of suit, the defendants are liable to pay Rs.6,61,415/- towards the principal amount, Rs.2,03,585/-towards interest at 18% p.a. from the due date to 19-4-2013 and Rs.5,000/- towards misc.charges, totally 16 O.S.No.3132/2013 Rs.8,70,000/-. Hence, the plaintiff has constrained to file this suit for recovery of said amount and pray to decree the suit.
12. It is the contention of the defendants that as placement agreement dtd.11-11-2009 is only for one year, it has ended on 10-11-2010. Thereafter, it has been not extended and plaintiff company has not produced a scrap of paper to show that agreement was mutually consented for the subsequent years. Hence, defendant company is not liable to pay any service charges for subsequent years. Hence, plaintiff company has no locus standi to maintain any suit for subsequent years. On careful perusal of the entire materials before this Court, the plaintiff company has made placement of as many as 26 candidates from 22-9-2010 to 15-12-2011 and those candidates have been employed in the defendant company and has taken services of the said candidates. Accepting the 26 candidates provided by the plaintiff company from 22-9-2010 to 15-12- 2011 itself amounts to implied consent and placement agreement for 11-11-2009 has been impliedly renewed on mutual consent i.e. by accepting services of the candidates provided by the 17 O.S.No.3132/2013 plaintiff company to the defendant company. If at all the defendant company decided not to continue the placement agreement, defendant company ought not to have accepted the candidates provided by the plaintiff company after the completion of the agreement. There were number of email communications between the plaintiff company with that of the defendant company as per Ex.P.45 to P.70, 72 & 73 with regard to the providing of the candidates enlisted in the plaint para No.3. Ex.P.71, 71(a), (b), (c) discloses the deduction of TDS for the year 2010, 2011 and 2012 pertaining to the placement of candidates by the plaintiff to the defendant company. At this stage, it is to be noted that the scheme of TDS is implemented and responsibility has been fixed on the payer of the amount to deduct the TDS and then pay the amount to the payee. Therefore, this clearly indicates that the plaintiff company and defendant company have dealt with mutually with regard to the placement of alleged 26 candidates. Hence, it can be safely arrive to the conclusion that though the placement agreement for the year 2009 is only for one year, both plaintiff and defendant company have dealt with up to 15-12-2011. This is 18 O.S.No.3132/2013 nothing but renewal of placement agreement by mutual consent. Hence, the defendant company is liable to pay consultation charges as prayed in the suit after deducting the TDS amount. In the instant case, though D.W.1 has denied the continuation of placement agreement for the year 2010 and 2011, but admitted in his cross-examination with regard to the placement of above candidates and email correspondences between the plaintiff company with that of the defendant company. For better appreciation, I cull out the same.
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13. On careful perusal of the above culled out deposition of D.W.1, it is quite clear that the placement transaction was continued by the plaintiff company with that of the defendant company up to 15-12-2011. Therefore, the defendant company is liable to pay consultation charges to the plaintiff company as claimed by the plaintiff company which works out as under:
Rs.6,61,415-00 - Rs.66,141.50 = Rs.5,95,273-50 rounded off to Rs.5,95,275/-
Hence, I answer issue No.1 and 2 in the affirmative, issue No.3 partly in the affirmative.
14. During the course of the evidence, D.W.1 has deposed that some of the candidates placed by the plaintiff have been left 20 O.S.No.3132/2013 out from the service within 3 months only. For such candidates, defendant company has not liable to pay any consultancy charges to the plaintiff company. But, the defendant company neither in their pleadings or in the evidence, they have not mentioned the list of the candidates who have dropped their service within 3 months. Hence, this Court is of the opinion that the defendant has utterly failed in proving the said allegations made. Hence, it is not possible to calculate the consultation charges pertaining to the left out candidates. However, defendant is at liberty to submit the list of candidates placed by the plaintiff, who have left out within 3 months. And calculate the amount as consultancy fees which alleged to have been dropped out. The same is to be deducted in the total claim of the plaintiff.
15. In the instant case, the plaintiff has claimed interest at 18% p.a. on the outstanding amount, but the interest claimed by the plaintiff is on the higher side. This Court is not empowered to change the contractual rate of interest agreed between the parties. However, this Court is empowered to award future rate 21 O.S.No.3132/2013 of interest from the date of filing of the suit till realization of the decreetal amount as per the prevailing rates of interest on the bank deposits under various nationalized banks as per the rules and regulations made by the Reserve Bank of India. Under the Interest Act, the party is entitled to claim interest at the 'current rate of interest' which expression is defined in Clause(b) of Sec.2 of the Interest Act, it means that, the highest of the maximum rates at which interest may be paid on different classes of deposits by different classes of schedule banks in accordance with the direction given or issued to the banking companies generally by the Reserve Bank of India under the Banking Regulation Act, 1949. Therefore, if interest at the rate of 12% p.a. on the loan amount from the date of filing of the suit till the realization of the entire decreetal amount is awarded it would meet the ends of justice. Hence, this Court is of the opinion that plaintiff is entitled to interest at the rate of 12% p.a. on Rs.5,95,275/- from the date of notice i.e.22-8- 2012 till realization on outstanding amount.
22 O.S.No.3132/2013
16. ISSUE NO.4: In view of my above discussion and the reasons stated therein, I proceed to pass the following:
ORDER The suit of the plaintiff is decreed with costs.
Plaintiff is entitled to recover from defendants 1 to 3 & 5 Rs.5,95,275/-
(Rupees Five Lakhs Ninety Five Thousand Two Hundred and Seventy Five only) along with interest at 12% p.a. on principal amount of Rs.5,95,275/- from the date of notice i.e. 22-8-2012 till realization.
The defendants 1 to 3 & 5 are hereby directed to pay the decreetal amount within 2 months from the date of this judgment.
Draw decree accordingly.
(Dictated to the Judgment Writer and also dictated on computer, transcribed thereof, corrected, signed and then pronounced by me in the open Court on this THE 19th DAY OF SEPTEMBER 2016).
(M.G.KUDAVAKKALIGER), XXX ADDL.CITY CIVIL JUDGE, BENGALURU.23 O.S.No.3132/2013
ANNEXURE WITNESSES EXAMINED FOR THE PLAINTIFF/S:
P.W. 1 Raghava Jenni.
WITNESSES EXAMINED FOR THE DEFENDANTS/S:
Nil.
DOCUMENTS MARKED FOR THE PLAINTIFF/S:
Ex.P.1 Authorization letter.
Ex.P.2 Resolution.
Ex.P.3 Agreement.
Ex.P.4 to 29 Invoices.
Ex.P.30 Copy of legal notice.
Ex.P.31 to33 Postal Receipts.
Ex.P.34 to 36 Acknowledgements.
Ex.P.37 Copy of notice.
Ex.P.38 to 42 Receipts.
DOCUMENTS MARKED FOR THE DEFENDANTS/S:
Ex.D.1 Reply notice.
Ex.D.1(a) Period portion.
(M.G.KUDAVAKKALIGER),
XXX ADDL.CITY CIVIL JUDGE,
BENGALURU.
24 O.S.No.3132/2013