Delhi District Court
Rameshwar Lal Foods Pvt Ltd vs Kapasan Agro Pvt Ltd on 13 November, 2024
DLCT010156502023
IN THE COURT OF SH. SANJEEV KUMAR AGGARWAL :
DISTRICT JUDGE (COMMERCIAL) -01 : CENTRAL, TIS
HAZARI COURTS, DELHI
CS (Comm.) No. 1458/23
M/s Rameshwar Lal Foods Pvt. Ltd.
1730, 2nd Floor, Room No. 204,
Nayi Basti Naya Bazar,
Delhi-110006
....... PLAINTIFF
VERSUS
M/s Kapasan Agro Pvt. Ltd.
Rani Durgawati Ward Distt. Siwani,
Madhya Pradesh
Through its Director
Sh. Mukesh Khandelwal
.... DEFENDANT
Date of institution : 01.11.2023
Date of reserving Judgment : 24.10.2024
Date of decision : 13.11.2024
SUIT FOR RECOVERY OF Rs. 32,89,595/- alongwith interest
@18% per annum
JUDGMENT
1. Vide this judgment, I shall decide the present suit filed by CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 1 of 58 the plaintiff against the defendant for recovery of Rs. 32,89,595/- alongwith interest @18% p.a.
2. Brief facts as stated in the plaint are that;
(i) plaintiff is a company dealing in manufacture, procurement, and supply of parboiled, steam and raw rice under the business registered as M/s Rameshwar Lal Foods Pvt. Ltd. having its office at 1730, 2nd Floor, Room No. 204, Nayi Basti, Naya Bazar, Delhi-110006.
(ii) that in the month of June, 2022 of the regular buyer of plaintiff namely M.R. Overseas placed an Order of 1040 Metric Tons of Indian Broken Rice which was to be delivered by the plaintiff within a period of 10 days from the date of Order at the yard of the container corporation of India situated at Nagpur.
(iii) time was the essence of the contract between the plaintiff and the buyer as it was agreed, the goods were to be supplied and loaded in the containers booked by the buyer within a period of 30 days from the date of order, post which, the detention and other damages / charges will have to be indemnified by the plaintiff.
(iv) that after arriving at the said agreement with buyer MR overseas , plaintiff started procuring the Indian Broken Rice from his ordinary sources and contacted his broker Sh. Hemant Sharma [in short Broker) and intimated him about his requirement upon which Broker contacted the present defendant's director Sh. Mukesh Khandelwal and elaborated the requirement of the CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 2 of 58 plaintiff in terms of quality and quantity of rice required.
(v) that upon the assurances of defendant, plaintiff placed an purchase order dt. 08.06.2022 with defendant for purchase of 780 metric tons of Indian Broken Rice at the price of Rs. 2125/- per quintal, which was to be delivered by the plaintiff at the address specified by plaintiff within a period of 10 days from the date of placement of purchase order, failing which the goods will be purchased from open market and the price difference and other damages will have to be indemnified by the defendant.
(vi) that on 10.06.2022 when the plaintiff obtained the two purchase orders in writing both dt. 10.06.2022 cumulatively amounting to 1040 metric tons of Indian Broken Rice from the buyer, plaintiff had placed the order with defendant as well as his other suppliers and with the defendant already undertaking to deliver the goods within a period of 10 days from the date of purchase order being placed i.e. on 08.06.2022,
(vii) defendant in contravention of obligation undertaken by him vide accepting the purchase order, not only failed to provide the goods ordered by plaintiff within stipulated time period but also only delivered 17 containers of rice 442 metric tons, thus, failed to meet the purchase order in terms of the quantity.
(viii) that plaintiff made made payment as per agreed upon time period to the tune of Rs. 68,62,604/- and that also after much delay from the time period period agreed between the parties, the CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 3 of 58 defendant failed to deliver the remaining 13 containers of rice (332 metric tons) due to which plaintiff suffered losses.
(ix) that due to failure of the defendant to provide the goods ordered by the plaintiff as per purchase order, plaintiff was constrained to procure the remaining 13 containers of rice from the open market at the rate 2180 per quintal thereby causing a loss of 55 rupees per quintal to the plaintiff thereby constraining the plaintiff an extra amount of Rs. 1,82,320/- and further an amount of Rs. 20,000/- as transportation / freight charges in procuring the said goods.
(x) that defendant sent a misconceived legal notice dt. 06.12.2022 to the plaintiff wherein defendant admitted his failure to perform his part of obligations undertaken by him by supplying only 17 containers of rice [442 metric tons] instead of agreed quantity of 30 containers [780 metric tons] but despite being well aware of the fact that such failure of defendant had caused huge losses upon the plaintiff, the defendant vide the said legal notice demanded Rs. 31,11,083/- as balance payment towards the 17 containers of rice supplied by the defendant to the plaintiff.
(xi) that on 02.01.2013 plaintiff sent a reply / demand notice to said legal notice elaborating how the defendant caused losses to plaintiff and sought the defendant to meet the damages suffered by plaintiff which as per the assessment of plaintiff were amassing to the tune of Rs. 57,74,650/- which after deducting the claim of defendant of Rs. 31,11,083/-, aggregated to a total of Rs.
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 4 of 58 26,63,567/- but defendant failed to pay the said amount,
(xii) hence, plaintiff approached for pre-institution mediation by filing application under Section 12A of The Commercial Courts Act, 2015 but same was declared a non-starter,
3. Summons of the suit were issued to the defendant and defendant contested the suit by filing written statement. In its written statement, defendant has taken preliminary objections that this Court has no territorial jurisdiction to entertain the present suit as the order was placed by the plaintiff at defendant's place at Seoni, M.P. and the goods were sent from Seoni, M.P. and also delivered to the plaintiff at Mihan Distt. Nagpur, Maharastra, which does not fall within the territorial jurisdiction of this Court.
4. On merits, defendant has denied the contents of plaint. It is denied by defendant that the time was essence of the contract between the plaintiff and the buyer as it was agreed upon by the plaintiff and the buyer that in the purchase order, it will be specifically stipulated that the goods were to be supplied and loaded in the containers booked by the buyer within 30 days from the date of order, post which the detention and other damages / charges will have to be indemnified by the plaintiff. It is also denied by defendant that plaintiff has placed the order of 780 metric tons of Indian Broken Rice and within a period of 10 days goods were supplied to the plaintiff or that in case of failure of defendant to supply the goods, plaintiff would purchase the goods from the open market and the price difference / other charges will CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 5 of 58 have to be indemnified paid by the defendant.
5. It has been stated that there was no written or oral contract between the plaintiff and the defendant that the goods was to be supplied within a period of 10 days. It is further stated that after delivery of the goods, the payment / cost thereof was agreed to be cleared to the defendant immediately in 10 days. It is further stated that at the time of placing of the order, the price was decided to the tune of Rs. 2125 per quintal.
6. It has been stated that defendant supplied 17 containers of broken rice costing of Rs. 99,73,687/- to the plaintiff but but only paid part amount of Rs. 68,62,604/-, plaintiff had stopped / defaulted in making the payment of Rs. 31,11,083/- against goods of 146 metric tons which were already delivered to the plaintiff due to which defendant suffered huge losses because the defendant was unable to make the payment to whom, the defendant had purchased the goods.
7. It is further stated by defendant that since plaintiff defaulted in payment of balance amount of Rs. 31,11,083/- and despite several requests, plaintiff did not pay the said amount, therefore defendant stopped delivery of further goods.
8. It has been further stated by defendant that it was forced to issue legal notice dt. 29.05.2023 and further a complaint was has also been lodged at PS : Seoni, M.P. on 11.06.2023 against the plaintiff and its co-directors. It has been further stated that CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 6 of 58 plaintiff had made last part payment of Rs. 5,24,250/- on 16.08.2022 as reflected in the ledger and thereafter plaintiff stopped making the payment. Thus, defendant has denied that he is not liable to pay any amount to the plaintiff and the plaintiff is liable to pay Rs. 31,11,083/- to the defendant. Hence, it is prayed for dismissal of the suit.
9. No replication has been filed by plaintiff despite opportunity given.
10. Both parties have filed affidavits qua admission / denial of documents, in which plaintiff has only admitted two documents (1) copy of civil suit no. 20/2023, Mukesh Khandelwal Vs. Rameshwar Lal Food Pvt. Ltd. & (2) copy of reply sent by the plaintiff to the legal notice of defendant whereas defendant has only admitted two documents i.e. (1) copy of legal notice dt. 06.12.2022 & (2) copy of legal notice dt. 29.05.2023.
11. After completion of the pleadings, the following issues were framed vide order dated 22.04.2024 :-
1. Whether this Court has no territorial jurisdiction to entertain the present suit ? OPD
2. Whether the plaintiff has failed to make the due payment of Rs. 31,11,083/- of goods already supplied by the defendant to the plaintiff, if so what effect ? OPD
3. Whether the defendant is entitled to stop delivery of the further goods in view of failure of the plaintiff to pay the balance amount of goods already supplied ? OPD CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 7 of 58
4. Whether the purchase order dt. 08.06.2022 Mark PX is forged and fabricated and genuine purchase order is PXP1 ? Onus upon both the parties
5. Whether the time was the essence of the contract between the plaintiff and the defendant ? OPP
6. Whether the defendant failed to supply the remaining 13 containers of rice to the plaintiff and by the said act caused financial loss to the plaintiff ? OPP
7. Whether the plaintiff is entitled to decree for recovery of suit amount of Rs. 32,89,595/- ? OPP
8. Whether the plaintiff is entitled to pendentelite and future interest, if so, at what rate ? OPP
9. Relief.
12. In order to prove its case, plaintiff has examined three witnesses i.e. Shrawan Kumar Aggarwal its director as PW1, Sh. Hemant Sharma as PW2 and Sh. Rohit Arora as PW3.
13. On the other hand, defendant has examined Sh. Mukesh Khandelwal, its director as DW1, who led his evidence by way of affidavit Ex. DW1/A.
14. Arguments have been heard from Sh. R.K. Tarun, Ld. Counsel for plaintiff and Sh. Nitin Garg, Ld. Counsel for defendant.
EVIDENCE CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 8 of 58 PLAINTIFF'S EVIDENCE
15. PW1 Sh. Shrawan Kumar Aggarwal is the Director/ AR of the plaintiff. He in his examination in chief led by way of affidavit Ex. PW1/A has almost repeated the same contents as stated in the plaint therefore same are not repeated here. He has also relied upon the following documents :-
1. Copy of board resolution dated 22.7.2023 by which he was appointed as AR to institute present suit as Ex.PW1/1
2. Purchase order dated 8.6.2022 as Ex. PW1/2.
3. Copy of Purchase order No. RF/MRO/2022-23/019 dated 10.6.2022 issued by MR Overseas Pvt. Ltd., to plaintiff for supply of 7280 Quintal 28 FCL broken rice as Mark PW1/3
4. Purchase order No. RF/MRO/2022-23/020 dated 10.6.2022 issued by MR Overseas Pvt. Ltd., to plaintiff for supply of 3120 Quintal 12 FCL broken rice as Mark PW1/4
5. Copy of invoices, receipts, receipt of delivery of goods/ rice sent by defendant to plaintiff as well as invoices by which plaintiff sold and the rice and supply to M. R. Overseas as Mark P1/1 to Mark P1/89.
6. Copy of legal notice dt. 06.12.2022 sent by defendant and reply of said legal notice dt. 02.01.2023 sent by plaintiff as Ex. PW1/5.
7. Copy of debit note of Rs. 7243786/- raised by M.R. Overseas against plaintiff as Mark PW1/6
8. Non Starter Report as Ex. PW1/7 CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 9 of 58
16. In his cross examination he deposed that probably the MR Overseas has placed order for supply of broken rice to the plaintiff firm on 10.06.2022 for 1040 Metric Ton(MT). Plaintiff had dealing with MR Overseas to supply aforesaid rice in 30 days and they had ordered to defendant to supply the same within 10 days to the plaintiff through broker Hemant Sharma. He does not know Mukesh Khandewal, Director of Defendant company personally and has not met with Mukesh Khandewal prior to filing of the present suit. The order to defendant for supply of rice was given for 780 Metric Ton(MT). He was shown purchase order dated 08.06.2022 from judicial file mark PY and also DW1/P1. He admitted that there is a overwriting on the said document. He denied the suggestion that the order was for 750 Metric Ton but he made overwriting to make it as order of 780 Metric Ton. He stated that signature on encircle X is of defendant staff who has come to our office. He does not know the name of the said staff as it is a old transaction. He denied the suggestion that signature at encircle X is forged and fabricated by plaintiff officials. He stated that carbon copy of order Ex. PW1/2 was handed over to the staff of the defendant and original copy was kept by plaintiff. The said staff of the defendant visited to the plaintiff office on 08.06.2022. He denied the suggestion that the said order was sent to broker Hemant Sharma through whatsapp. He denied the suggestion that purchase order mark PY dated 08.06.2022. He also denied the suggestion that same is original purchase order which is given to CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 10 of 58 the defendant. The signature at point X on DW1/P1 is of plaintiff staff namely Anuj Sharma. He stated he does not know whether the Borker Hemant Sharma has sent the purchase order Ex. DW1/P1 to broker Manoj Sharma or not. He was put question as under:
Q. Whether this document is a copy of original purpose order placed by plaintiff to defendant or is a forged and fabricated document?.
Ans. The said document is copy of the original purchase order. (Vol. The said document was send to the broker Hemant Sharma but same does not become a purchase order till it is signed by the defendant official).
He become aware that Manoj Sharma is involved in the transaction after 15 days of the purchase order Ex. PW1/2 was signed by the defendant. He has not enquired the name and designation of the staff of the defendant who signed on the Ex. PW1/2. He denied the suggestion that no staff of the defendant visited to the plaintiff office qua said purchase order or signed on the same.
He admitted the suggestion that the rice qua the purchase order dated 08.06.2022 given by the plaintiff to the defendant was to supply from Seoni (MP) to ICD(International Container Depot) at Mihan, Nagpur. He was shown the ledger of defendant maintained by plaintiff which is now Ex.PW1/D2. He denied the suggestion that plaintiff company has sent the said ledger to the defendant company and stated that same is forged CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 11 of 58 and fabricated and not containing each and every entry and at that stage he produce the ledger which plaintiff maintained qua defendant Ex. PW1/D3. He stated that payment of the bill dated 22.06.2022 was made by the plaintiff to the defendant on 07.07.2022. He admitted that Plaintiff has not written any letter to MR Overseas how they have suffered the loss mentioned in the said debit note. Plaintiff has intended to the settlement with MR overseas with respect to said debit note for a sum of Rs.
58,070,86/-. The said amount has not been yet paid to MR Overseas. (Vol. plaintiff has told to them the present case qua recovery of said amount is pending in Court). The said amount of Rs. 58,070,86/- has been shown in the GST return. He has not filed the record of the same. He denied the suggestion that the plaintiff in connivance with the MR overseas in order to denied the defendant its due of Rs. 31,110,83/- has concocted this false story of MR overseas is suffering loss and demand of the same by MR Overseas from plaintiff.
17. PW2 Sh. Hemant Sharma in his evidence led by way of affidavit Ex. PW1/A has deposed that plaint company in the first week of June, 2022 contacted him seeking to get in contact with supplier of rice who would supply 1040 metric tons at ICD, Nagpur, Maharashtra in 10 days from the day the purchase order is placed and he reached out various rice suppliers and connected with defendant, which agreed to supply 780 metric tons of rice, out of 1040 metric tons, to the plaintiff within ten days from the date of purchase order at a rate of Rs. 2125 per quintal and CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 12 of 58 thereafter, he informed the plaintiff about the defendant's acceptance to supply 780 metric tons of rice within the agreed time frame and after receiving confirmation from plaintiff, he communicated defendant who ten informed him that their staff would travel to Delhi around 7th - 8th June, 2022 to sign the purchase order / contract with the plaintiff. He further deposed that thereafter, plaintiff on 7-8 June, 2022 contacted him and informed that staff of defendant visited their office in Naya Bazar, Delhi and signed the purchase order.
In his cross examination, he deposed that he use whats app in my mobile having No. 9755509002. He has conversation with plaintiff on mobile phone as well as through whats app whenever required. He admitted the suggestion that the said whats app chat EXPW2/D1 is between me and plaintiff. Said chat is on group chat was made from the mobile number 9993800018 by him. The said chat was sent by him regarding confirmation of trade made by him. The group admin is plaintiff and the group members are the staff of plaintiff and being broker dealing in the same trade, He is also made as member of the group by plaintiff. He admitted the suggestion that as per the chat, after unloading of goods, the payment is to be made within 7 days (Vol. The payment is to be made in 7-10 days though in the chat it is mentioned 7 days). He admitted that purchase order Ex. PW2/D1 encircle X was posted on the said group by some staff of plaintiff. He does not know when the said purchase order Ex. PW2/D1 encircle X was posted on group. He cannot produce the said original chat as CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 13 of 58 it is more than two years old. No advance payment was made by plaintiff to defendant with respect to the said purchase order.
He never visited to Shivni, M.P. to meet defendant. He know Manoj Sharma who is also broker. He had conversation with him on phone. He know in defendant company, Mr. Mukesh Khandelwal with whom I had telephonic conversation. First time he had conversation with Mukesh Khandelwal of defendant may be in June 2022 or 10-12 days prior to it. He denied the suggestion that he had first time telephonic conversation with Mukesh Khandelwal on 9 July 2022. He cannot file any document to prove that he had conversation with Mukesh Khandelwal prior to 9.7.2022 either by way of whats app chat, call record or any written communication.
The payment of brokerage is made to him either via cheque or by online. He admitted that defendant Kapasan Agro has never made me any payment qua brokerage till date. He denied the suggestion that the defendant has never madeany brokerage payment because he never was a broker of defendant Kapasan. He stated that he cannot tell whether I have forwarded the message of purchase order Ex. PW2/D1 encircle X to the defendant through whats app or not. He stated that mobile number of Manoj Sharma is 9329104655. He cannot say whether he send the purchase order Ex. PW2/D1 encircle X to Manoj Sharma through whats app on the said mobile number from my mobile phone No. 9755509002. He stated he does not know CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 14 of 58 whether Manoj Sharma has forwarded the said purchase order Ex. PW2/D1 encircle X to Kapasan Agro or not. He admitted the suggestion that hee used to inform to Manoj Sharma about the purchase orders and Manoj Sharma used to inform to Kapasan Agro to deliver the goods as per said orders Though he voluntarily also deposed that he had also dealt directly with the defendant with respect to the orders of plaintiff. He admitted the suggestion that he received the ledger of defendant EXPW2/D3 qua plaintiff sent by defendant to me on my whats app. He stated that he did not ask the plaintiff to make the payment of the goods which was made by defendant to plaintiff within 7-10 days as defendant has not supplied the agreed quantity of goods (Vol. some payments of the goods delivered have already been made to the defendant by plaintiff and some payment was hold by plaintiff due to aforesaid reason).
He admitted that neither Mukesh Khandelwal nor any staff of defendant has ever met him in Delhi with respect to the transaction involved in this case. He also admitted that neither Mukesh Khandelwal nor any official of defendant has signed any purchase order in his presence in Delhi or anywhere else (Vol. I have been informed about signing of the same by plaintiff official). He admitted that whatever communication took place with the defendant, was with respect to the purchase order Ex. PW2/D1 encircle X (original of which is mentioned as Ex. PW1/2). He stated that he first time seen the original purchase CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 15 of 58 order Ex. PW1/2 in the year 2023 in July - August when he came to Delhi. He admitted that in the whats app group Rameshwar Lal has put the purchase order Ex. PW2/D1 encircle X. He admitted that the purchase order Ex. PW2/D1 encircle X and Ex. PW1/2 are not the same (Vol. In the Ex. PW2/D1, the condition of 10 days is not mentioned and same is not signed by defendant as in Ex. PW2/D1). I have not sent any whats app message which contains the condition of 10 days to Manoj or to the defendant.
He stated that he is not sure that defendant has sent whats app message on 2.8.2022 to make payment of Rs. 10 lacs out of Rs. 31,59,591/- and on 10.8.2022 defendant has sent another whats app message to make payment of Rs. 30 lacs out of 40,49,204/ - or that defendant has asked me to make payment of Rs. 20 lacs through whats app message on 16.8.2022 at 6.25 pm out of 31,11,083/- and told that only after that delivery of balance goods will be made or that on 16.9.2022 the defendant has asked to make complete payment with respect to goods already delivered as he is unable to purchase the goods due to shortage of money (Vol. With respect to my abovesaid answer, I want to say that plaintiff had already made payment of most of containers and I always insisted to the defendant telephonically to deliver complete goods of 780 metric tonnes to the plaintiff as the shipping containers were already booked at Nagpur ICD).
18. Plaintiff has also examined Sh. Rohit Arora, Director of M.R. Overseas Pvt. Ltd., as PW3 who led his evidence by way of affidavit Ex. PW3/A. In his examination in chief he deposed that CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 16 of 58 in first week of June 2022 he approached to the plaintiff to procure 1040 Metric Ton of Rice for export with in 30 days and gave two purchase order on 10 June 2022 EXPW3/1 an EXP3/2. On 9th July 2022 the plaintiff informed him his inability to complete the order and sought additional time which was granted till 31St July 2022 and later on granted time 30 days grace time. On 29th August 2022 plaintiff supplied 1021 Meteric ton of rice and he agreed to adjust remaining quantity. After assessing the loss incurred due to plaintiff failure to supply the goods in timely manner debit note dt. 21st March 2023 amounting to Rs. 7243786/- EXPW3/4 was issued.
In his cross examination, he deposed that he has not filed the Export Order received by M.R. Overseas Pvt. Ltd. on record. He after seeing Mark PW1/3 stated that there is signature of my Managing Director Sh. Nand Kumar on the said document at point A but he does not know whose signature is at point B on the said document. He has not filed the details of a losses suffered by M.R. Overseas. [Vol. I have brought the same today]. Same was Ex. PW3/D2. He was asked question as under:
Q. As per document filed by you, the losses were suffered in year 2022 whereas the debit note was issued on 21.03.2023. Why debit note was issued after a long period ?
Ans. I have continuous business with Rameshwar Lal Foods Pvt. Ltd. and when I sat with the said firm official for settlement of the accounts and then we issued the debit note, though we had already conveyed to them about the losses suffered. He admitted that said CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 17 of 58 debit note is not mentioned in GST returns. It is wrong to suggest that I have not mentioned the same in GST as no such debit note was issued.
DEFENDANTS' EVIDENCE
19. On the other hand, in order to deny the claim of plaintiff, defendant has examined its Director Sh. Mukesh Khandelwal as DW1, who led his evidence by way of affidavit Ex. DW1/A. He deposed that he has been authorized by board of resolution dt. 20.02.2024, which is Ex. DW1/1. He further deposed that the order for goods i.e. broken rice was placed by plaintiff at defendant's place at Seoni, M.P. and the goods were sent from Seoni, M.P and also delivered to the plaintiff at Mihan, Distt. Nagpur, Maharashtra. He further deposed that said order was placed by the plaintiff vide purchase order dt. 08.06.2022 which was issued to the defendant company and the said purchase order was neither signed by defendant nor any of its employee and no period of supply was fixed in this purchase order. He further deposed that said purchase order was given to him by Sh. Manoj Sharma, who had received the same from Sh. Hemant Sharma through whatsapp. He further deposed that the goods (17 containers i.e. 470 metric tons of broken rice) worth Rs. 99,73,687/- were supplied by the defendant company to the plaintiff which plaintiff has already acknowledged and admitted. He further deposed that plaintiff did not pay the amount of Rs. 99,73,687/-, however, only paid a part payment of Rs. 68,62,604/-
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 18 of 58 leaving a balance of Rs. 31,11,083/-. He further deposed that despite several requests, the plaintiff has still not paid the remaining amount of Rs. 31,11,083/-, therefore, defendant was forced to get issued a legal notice dt. 29.05.2023 to the plaintiff and further a complaint has also been lodged at police station Seoni, M.P. on 11.06.2023 against the plaintiff and its directors Sumit Kumar Aggarwal, Shrawan Kumar Aggarwal, Shambhu Aggarwal, Amit Aggarwal, Pawan Kumar Aggarwal, Sunil Kumar Aggarwal and also against Manoj Sharma and Hemant Sharma, who also acting for the plaintiff. He further deposed that said legal notice dt. 29.05.2023 was replied by the plaintiff vide reply dt. 16.06.2023. He further deposed that defendant has already filed the suit for recovery of aforementioned amount against the plaintiff titled as "Mukesh Khandelwal Vs. M/s Rameshwar Lal Foods Pvt. Ltd. & Ors." which is pending for adjudication before the Court of Ld. Civil Judge, District Seoni, M.P., however, said suit has been stayed by the Hon'ble Supreme Court in T.P. (Civil) No. 3342/2023. He has relied upon the following documents : -
1. True copy of board resolution dated 20.2.2024 authorizing him to appear in this case as Ex.DW1/1
2. Purchase order dated 8.6.2022 Ex. DW1/P1
3. Invoices for supply of broken rice supplied by defendant to plaintiff as Ex. DW1/3A to Ex. DW1/3Q
4. Ledger account of plaintiff maintained by the defendant Ex. PW2/D3
5. Copy of legal notice dated 29.5.2023 as Ex. DW1/5 CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 19 of 58
6. Reply of plaintiff dated 16.6.2023 as Ex. DW1/6.
7. Certified copy of police complaint dated 11.6.2023 as Ex. DW1/7.
8. Certified copy of suit for recovery filed by defendant titled as Mukesh Khandelwal Vs. M/s. Rameshwar Lal Foods Pvt. Ltd. as Ex. DW1/8.
9. Certificate under Section 663 of Bharatiya Sakshya Adhiniyam as Ex. DW1/9.
In his cross examination, he deposed that defendant is the manufacturer as well as trader of rice (We purchase dhan and then taking rice from it broke the rice which is called as broked rice). Defendant has not filed any document to show that on 8.6.2022, defendant was having stock of 780 metric ton of broken rice. He denied the suggestion that defendant has no capacity to enter into contract for supply of 780 metric ton broken rice on 8.6.2022 as defendant does not have such quantity of rice in its stock. It is correct that the order which received by the defendant from plaintiff was to supply whole of the rice of 780 metric ton and there was no agreement that same was to be supplied in parts. There was agreement that payment is to be made within 10 days on each and every truckwise delivery of goods. He stated purchase order Ex. PW1/2 is not supplied to us by the plaintiff and further stated that purchase order Ex. DW1/P1 was supplied. He admitted that in the said purchase order, it is not mentioned that payment is to be made on delivery of goods by each truck (Vol. It was mutual understanding that payment is to be made within 10 CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 20 of 58 days of delivery of goods of each truck and the plaintiff has also made the payment accordingly earlier).
No person on behalf of the defendant had signed on the purchase order (Vol. The said purchase order i.e. Ex. DW1/P1 was received through whats app from Manoj Sharma, broker on 8.6.2022 at 4.48 pm). Manoj Sharma is his broker. I do not know the office address of Manoj Sharma as he never visited Raipur nor he has visited to defendant office (Vol. We used to deal through mobile phone). I know the mobile number of Manoj Sharma which is 9329104655. There were many other dealings prior to the dealing in question through said Manoj Sharma. He denied the suggestion that no dealing of supply of 780 metric ton of broken rice between plaintiff and defendant has took place through broker Manoj Sharma. In August 2022, the price of broken rice was approximately same as in June 2022. He denied the suggestion that in August 2022, the prices of broken rice considerably increased from Rs. 2125/- per quintel as agreed between them and due to said reason they did not supply the rice to the plaintiff as same would have fetch less price. He denied the suggestion that in August 2022, the defendant does not have stock to supply the rice to the plaintiff (Vol. We have 100 metric ton stock and I made call to Hemant Sharma on 13.7.2022, the broker of plaintiff intimating about the same and demand previous dues and told that after said payment, the said rice will be supplied).
He stated that defendant cannot supply the remaining CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 21 of 58 supply of rice at the rate of Rs. 2125/- per quintel (Vol. As defendant's Mill's electricity has been disconnected due to non payment and therefore Mill is not running). Said 100 metric ton was available on the Mill on 13.7.2022 and He cannot say from where same was procured as there are number of sources from which dhan comes on the Mill. He denied the suggestion that on 13.7.2022, the supply of 310 metric ton was balance as per order (Vol. It was only 280 metric tons).
He stated that there was no time limit for supply of broken rice and the further delivery of the goods is to be made after making payment of previous delivery by the plaintiff. He admitted that the ordered goods was to be delivered to international container depot, Nagpur. He denied the suggestion that Manoj Sharma has informed to him that the plaintiff required 1040 metric ton broken rice and they told him that we could supply only 780 metric ton. The plaintiff has paid the amount of goods of 12 containers out of total 17 containers supplied by us. He admitted that the plaintiff has paid a sum of Rs. 68,62,804/- to the defendant. The defendant has supplied a total 470 metric ton goods to the plaintiff in 17 containers, and each container contains approximately 25-30 metric ton goods.
He stated that defendant has filed civil suit against plaintiff for recovery of the said amount. The defendant has received notice from DLSA regarding Pre Institution Mediation of the present case to be present on 3.10.2023. Said notice was received around 15 days prior to said date. Said civil suit was filed by the CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 22 of 58 defendant against plaintiff in Seoni Court on 27.8.2023. He denied the suggestion that the suit in Seoni Court was filed as a counterblast in response to the notice received from the DLSA for Pre Institution Mediation.
ARGUMENTS
20. It is argued by learned counsel for plaintiff with respect to issue no.1 that from the testimonies of PW1 & PW2 it is proved that purchase order Ex. PW1/2 has been placed at Delhi and the same has been signed by the defendant's staff at Delhi and further, payment of Rs. 68,62,604/- has been made by the plaintiff to the defendant at Delhi, therefore, part cause of action arose within the territorial jurisdiction of this Court, hence, this Court has territorial jurisdiction to entertain the present suit.
21. Ld. Counsel for plaintiff further argued that plaintiff through the testimonies of PW1 to PW3 has proved that plaintiff has received purchase order of 1040 metric tons of Indian Broken Rice from M.R. Overseas, which was to be supplied within 30 days and thereafter, plaintiff through broker Sh. Hemant Sharma approached the defendant and defendant agreed to supply 780 metric tons at the price of Rs. 2125 per quintal within a period of 10 days and accordingly purchase order Ex. PW1/2 was placed to the defendant which was duly signed by defendant's staff but the defendant has only supplied 17 containers of rice (442 metric tons) and despite repeated requests did not supply the remaining quantity of rice, hence, plaintiff has suffered losses of Rs.
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 23 of 58 57,74,650/-, therefore, after adjusting the balance amount of Rs. 31,11,083/- which plaintiff has to pay qua rice already supplied. Plaintiff is entitled to recover sum of Rs. 26,63,567/-.
22. On the other hand, Ld. Counsel for defendant argued that this Court has no territorial jurisdiction because the purchase order was placed by the plaintiff at defendant's place at Seoni, M.P. and the goods were sent from Seoni, M.P. and also delivered to the plaintiff at Mihan Distt. Nagpur, Maharastra, which does not fall within the territorial jurisdiction of this Court. He further argued that neither defendant or its staff visited at Delhi to sign the purchase order Ex. PW1/2, hence, in view of Section 20 of CPC this Court has no territorial jurisdiction to entertain the present suit.
23. Ld. Counsel for defendant further argued that even on merit plaintiff is not entitle to recover any amount as compensation for not supplying the goods as purchase order which is supplied to the defendant through whatsapp Ex. DW1/P1 does not contain any condition that the goods to be supplied within 10 days as there is blank prior to word 'days' in the purchase order which was posted on whatsapp as evidence from the said purchase order, therefore the plaintiff has never informed to the defendant that if the goods were not supplied within stipulated time plaintiff would suffer loss, therefore, plaintiff is not entitled to the amount of rice which is claimed as damage.
24. Ld. Counsel further argued that plaintiff has to make payment of the goods i.e. rice delivered container wise within 7- CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 24 of 58 10 days of the delivery of the goods and defendant supplied 17 containers of broken rice costing of Rs. 99,73,687/- to the plaintiff but plaintiff has only paid part amount of Rs. 68,62,604/- and thus, defaulted in making the payment of Rs. 31,11,083/- against goods of 146 metric tons which were already delivered to the plaintiff due to which defendant could not procure rice and suffered losses, hence, if any loss suffered to the plaintiff due to non-supplying of goods by the defendant but it was due to stoppage of payment by plaintiff to defendant for goods already supplied, therefore, plaintiff is not entitled to any amount for compensation of the goods rather defendant is entitled for recovery of aforesaid amount against the plaintiff for which defendant has already filed a suit titled as "Mukesh Khandelwal Vs. M/s Rameshwar Lal Foods Pvt. Ltd. & Ors." which is pending in the Court at District Seoni, M.P., therefore, the suit of the plaintiff is liable to be dismissed.
Analysis of Evidence/ Findings Issue No. 1 : "Whether this Court has no territorial jurisdiction to entertain the present suit ? OPD"
25. Section 20 of the Code of Civil Procedure deals with territorial jurisdiction of the Courts which provides as under :
"Other suits to be instituted where defendants reside or cause of action arises.
Subject to the limitations aforesaid, every suit shall be CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 25 of 58 instituted in a Court within the local limits of whose jurisdiction
(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally works for gain, as aforesaid, acquiesce in such institution; or
(c)The cause of action, wholly or in part, arises".
26. From the aforesaid Section it is evident that the suit can be filed by plaintiff either at the place where defendant resides or works for gain as per clause-(a) & (b) of Section 20 CPC and at the place where cause of action wholly or partly arises as per clause-(c) of Section 20 CPC.
27. From the plaint it is evident that plaintiff has given the address of defendant company at Rani Durgawati Ward, District Siwani, Madhya Pradesh. It is nowhere stated that defendant has any subordinate office within the territorial jurisdiction of this Court, therefore, this Court would not have territorial jurisdiction so far as clause-(a) & (b) of Section 20 CPC is concerned and this Court can entertain or try the present suit only if cause of action wholly or partly arose within territorial jurisdiction of this Court. The onus is upon the plaintiff to prove that this Court has CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 26 of 58 territorial jurisdiction. Plaintiff in para-19 of the plaint has stated that this Court has territorial to entertain and try the present suit as entire transaction was made at Delhi in the office of plaintiff, which is situated within the territorial jurisdiction of this Court.
28. In order to prove that part cause of action has arose with in territorial jurisdiction of this Court plaintiff has examined Sh. Shrawan Kumar Aggarwal, its director / AR as PW1, who has testified that plaintiff company operates from its office at Naya Bazar, Delhi. He further deposed that plaintiff company through broker Sh. Hemant Sharma contacted the defendant company, who assured to supply 780 metric tons of rice at Rs. 2125 per quintal out of the total 1040 metric tons within 10 days from the date of purchase order. PW1 has relied upon the purchase order dt. 08.06.2022 as Ex. PW1/2. In his cross examination, PW1 has deposed that carbon copy of order Ex. PW1/2 was handed over to the staff of the defendant and original copy was kept by plaintiff and the said staff of the defendant visited to the plaintiff office on 08.06.2022. He was shown purchase order dt. 08.06.2022. He denied the suggestion that same is original purchase order which is given to the defendant, which was marked Ex. DW1/P1. He deposed that signature at point X on DW1/P1 is of plaintiff staff namely Anuj Sharma. He admitted that the rice qua the purchase order dt. 08.06.2022 given by the plaintiff to the defendant was to supply from Seoni, M.P. to International Container Depot (ICD) at Mihan, Nagpur. He was shown the ledger of defendant maintained CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 27 of 58 by plaintiff Ex. PW1/D2. He denied the suggestion that the said ledger was sent by plaintiff company to defendant company.
29. Plaintiff has also examined Sh. Hemant Sharma as PW2, who led his evidence by way of affidavit Ex. PW2/A and deposed in his testimony that plaint company in the first week of June, 2022 contacted him seeking to get in contact with supplier of rice who would supply 1040 metric tons to ICD, Nagpur, Maharashtra in 10 days from the day the purchase order is placed and he reached out various rice suppliers and connected with defendant, which agreed to supply 780 metric tons of rice, out of 1040 metric tons, to the plaintiff within ten days from the date of purchase order at a rate of Rs. 2125 per quintal and thereafter, he informed the plaintiff about the defendant's acceptance to supply 780 metric tons of rice within the agreed time frame and after receiving confirmation from plaintiff, he communicated defendant who ten informed him that their staff would travel to Delhi around 7 th - 8th June, 2022 to sign the purchase order / contract with the plaintiff. He further deposed that thereafter, plaintiff on 7-8 June, 2022 contacted him and informed that staff of defendant visited their office in Naya Bazar, Delhi and signed the purchase order.
In his cross examination, he admitted that there was whatsapp chat between him and plaintiff Ex. PW2/D1 and said chat was sent by him regarding confirmation of trade made by him. He admitted that as per said chat, after unloading of goods, the payment is to be made within 7 days and voluntarily stated CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 28 of 58 that the payment is to be made in 7-10 days though in the chat it is mentioned 7 days. He further deposed that the purchase order Ex. PW2/D1 encircle X was posted on the said group by some staff of plaintiff. He further deposed that he never visited to Seoni, M.P. to meet defendant. He further deposed that he knows Manoj Sharma, who is also broker. He further deposed the he knows defendant company, Mr. Mukesh Khandelwal with whom he had telephonic conversation. He further deposed that he cannot tell whether he have forwarded the message of purchase order Ex. PW2/D1 encircle X to the defendant through whatsapp or not. He admitted that he never met Mukesh Khandelwal in Delhi with respect to the transaction involved in this case. He further deposed that he does not know whether Mukesh Khandelwal is only signing authority of Kapasan Agro. He deposed that whatever communication took place with the defendant was with respect to the purchase order Ex. PW2/D1 encircle X.
30. As far as testimony of PW3 Sh. Rohit Arora is concerned, same is not relevant for decision of present issue, hence, same is not discussed here.
31. On the other hand, defendant has only examined one witness i.e. Sh. Mukesh Khandelwal, its director /AR as DW1, who led his evidence by way of affidavit Ex. DW1/A. DW1 has deposed that the order for goods i.e. broken rice was placed by plaintiff at defendant's place at Seoni, M.P. and the goods were sent from Seoni, M.P and also delivered to the plaintiff at Mihan, CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 29 of 58 Distt. Nagpur, Maharashtra. He further deposed that said order was placed by the plaintiff vide purchase order dt. 08.06.2022 which was issued to the defendant company and the said purchase order was neither signed by defendant nor any of its employee and no period of supply was fixed in this purchase order. He further deposed that said purchase order was given to him by Sh. Manoj Sharma, who had received the same from Sh. Hemant Sharma through whatsapp. He further deposed that in pursuance of said purchase order, defendant sent 17 containers of broken rice worth Rs. 99,73,687/- to the plaintiff and plaintiff has paid only part payment of Rs. 68,62,604/- leaving a balance of Rs. 31,11,083/-.
In his cross examination, he admitted that plaintiff has paid the amount of goods of 12 containers, out of total 17 containers supplied by them.
32. From the testimonies DW1 it is evident that though he has denied the purchase order PW1/2 but he has admitted that there was purchase order dt. 08.06.2022 Ex. PW2/D1, which according to him was received through whatsapp sent by Sh. Hemant Sharma i.e. PW2 on the whatsapp of Sh. Manoj Sharma and Sh. Manoj Sharma sent to him. Admittedly said purchase order and purchase order EXPW1/2 are same except that it only bear signature of plaintiff side whereas purchase order EXPW1/2 allegedly also bear signature of defendant side and secondly PW1/2 contain numerical 10 before days which is not in PW2/D1. From the said purchase order it is evident that it bears CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 30 of 58 address of plaintiff company i.e. Naya Bazar, Delhi-06, which is situated within the territorial jurisdiction of this Court. As per cross examination of PW2, the said purchase order was placed in a group chat of group formed by plaintiff in which plaintiff's staff and brokers dealing with same trade and he is member of the said group, therefore, said purchase order has been posted on behalf of plaintiff from Delhi as plaintiff's office is situatead at Naya Bazar, Delhi as mentioned in the whatsapp chat. There is no defence of defendant that the plaintiff has any office in Siwani, Madhya Pradesh or that he has no office at Naya Bazar, Delhi, therefore, in my view, even if the purchase order EXP2/D1 is not signed by defendant at Delhi, since same is genesis of dealing between the plaintiff and the defendant company and same posted by the plaintiff at its office in whatsapp group, and in pursuance of said purchase order goods were sold by defendant to plaintiff and admittedly part payment was send by plaintiff from its office at Delhi therefore I hold that the part cause of action arose in Delhi.
33. I am not agree with the contention of Ld. Counsel for defendant that since the invoices issue by the defendant DW1/3A to EXPDW1/ 3Q contain the terms that subject to Seoni jurisdiction therefore said court will have jurisdiction only. Since same does not contain the word, only, exclusive at Seoni Court therefore Courts at Delhi also have jurisdiction. In this regard I rely upon M/S Swastik Gases P.Ltd vs Indian Oil Corp. Ltd AIRONLINE 2013 SC 365. The relevant para of judgement are as CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 31 of 58 under:
"16. In A.B.C. Laminart1, this Court was concerned with clause 11 in the agreement which read, "any dispute arising out of this sale shall be subject to Kaira jurisdiction". The disputes having arisen out of the contract between the parties, the respondents therein filed a suit for recovery of amount against the appellants therein and also claimed damages in the court of subordinate judge at Salem. The appellants, inter alia, raised the preliminary objection that the subordinate judge at Salem had no jurisdiction to entertain the suit as parties by express contract had agreed to confer exclusive jurisdiction in regard to all disputes arising out of the contract on the civil court at Kaira. When the matter reached this Court, one of the questions for consideration was whether the court at Salem had jurisdiction to entertain or try the suit. While dealing with this question, it was stated by this Court that the jurisdiction of the court in the matter of contract would depend on the situs of the contract and the cause of action arising through connecting factors. The Court referred to Sections 23 and 28 of the Indian Contract Act, 1872 (for short, 'Contract Act') and Section 20(c) of the Civil Procedure Code (for short 'Code') and also referred to Hakam Singh3 and in paragraph 21 (pgs. 175-176) of the Report held as under:
"......When the clause is clear, unambiguous and specific accepted notions of contract would bind the parties and unless the absence of ad idem can be shown, the other courts should avoid exercising jurisdiction. As regards construction of the ouster clause when words like 'alone', 'only', 'exclusive' and the like have been used there may be no difficulty. Even without such words in appropriate cases the maxim 'expressio unius est exclusio alterius'
-- expression of one is the exclusion of another -- may be applied. What is an appropriate case shall depend on the facts of the case. In such a case mention of one thing may imply exclusion of another. When certain jurisdiction is specified in a contract an intention to exclude all others from its operation may in such cases be inferred. It has therefore to be properly construed." Then, in paragraph 22(pg. 176) of the Report, this Court held as under:
".....We have already seen that making of the contract was a part of the cause of action and a suit on a contract therefore could be filed at the place where it CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 32 of 58 was made. Thus Kaira Court would even otherwise have had jurisdiction. The bobbins of metallic yarn were delivered at the address of the respondent at Salem which, therefore, would provide the connecting factor for court at Salem to have jurisdiction. If out of the two jurisdictions one was excluded by clause 11 it would not absolutely oust the jurisdiction of the court and, therefore, would not be void against public policy and would not violate Sections 23 and 28 of the Contract Act. The question then is whether it can be construed to have excluded the jurisdiction of the court at Salem. In the clause 'any dispute arising out of this sale shall be subject to Kaira jurisdiction' ex facie we do not find exclusionary words like 'exclusive', 'alone', 'only' and the like. Can the maxim 'expressio unius est exclusio alterius' be applied under the facts and circumstances of the case? The order of confirmation is of no assistance. The other general terms and conditions are also not indicative of exclusion of other jurisdictions. Under the facts and circumstances of the case we hold that while connecting factor with Kaira jurisdiction was ensured by fixing the situs of the contract within Kaira, other jurisdictions having connecting factors were not clearly, unambiguously and explicitly excluded. That being the position it could not be said that the jurisdiction of the court at Salem which court otherwise had jurisdiction under law through connecting factor of delivery of goods thereat was expressly excluded......"
17. In R.S.D.V. Finance[5] the question that fell for consideration in the appeal was, in light of the endorsement on the deposit receipt "subject to Anand jurisdiction", whether the Bombay High Court had jurisdiction to entertain the suit filed by the appellant therein. Following A.B.C. Laminart1, this Court in paragraph 9 (pgs. 136-137) of the Report held as under :
"We may also consider the effect of the endorsement 'Subject to Anand jurisdiction' made on the deposit receipt issued by the defendant. In the facts and circumstances of this case it cannot be disputed that the cause of action had arisen at Bombay as the amount of Rs 10,00,000 itself was paid through a cheque of the bank at Bombay and the same was deposited in the bank account of the defendant in the Bank of Baroda at Nariman Point, Bombay. The five post-dated cheques were also issued by the defendant being payable to the plaintiff at Bombay. The endorsement 'Subject to Anand jurisdiction' has been made unilaterally by the defendant while issuing the deposit receipt. The endorsement 'Subject to Anand jurisdiction' does not contain the ouster clause using the words like 'alone', 'only', 'exclusive' and the like. Thus the maxim 'expressio unius est exclusio alterius' cannot be applied under the facts and circumstances of the case and it cannot be held that merely because the deposit receipt contained the endorsement 'Subject to Anand jurisdiction' it excluded the jurisdiction of all other courts who were otherwise competent to entertain the suit. The view taken by us finds support from a decision of this Court in A.B.C. Laminart Pvt. Ltd. v. A.P. Agencies, Salem."
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 33 of 58
34. In view of aforesaid discussion I hold that Courts at Delhi shall also have jurisdiction as Part Cause of action arose in Delhi, therefore this Court has territorial jurisdiction to decide the present suit. Issue No. 1 is decided in favour of plaintiff and against the defendant accordingly.
Issue No. 4 : "Whether the purchase order dt. 08.06.2022 Mark PX is forged and fabricated and genuine purchase order is PXP1 ? Onus upon both the parties"
35. The photocopy of purchase order dt. 08.06.2022 mark PX later on during testimony of PW1 original of the same has been exhibited as PW1/2 and purchase order PXP1 was exhibited during cross examination of PW1 as DW1/P1 and it is also worthwhile to mention that DW1/P1 is also Exhibited as PW2/D1 during cross examination of PW2, therefore I will call purchase order mark PX as PW1/2 and purchase order mark PXP1 as PW2/D1 respectively henceforth.
36. It is undisputed fact that there is only one order given by the plaintiff to defendant to purchase broken rice but there are two different purchase order i.e. one which relied by plaintiff is dt. 08.06.2022 which has been exhibited as Ex. PW1/2 and the other is photo of same purchase order which has been posted on whatsapp chat by plaintiff side and the broker of plaintiff i.e. PW2 Sh. Hemant Sharma forwarded the same to the defendant and CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 34 of 58 exhibited as PW2/D1. Though the purchase order is one and same but there are two difference in the original purchase order and copy of purchase order forwarded to defendant i.e. purchase order EXPW1/2 mentioned numerical '10' prior to word 'days' and signature of both plaintiff firm and defendant firm whereas in copy of purchase order forwarded to defendant i.e. Exhibited PW2/D1 there is no numerical 10 before word 'days' and there is no signature of party other that plaintiff.
For better appreciating the difference scan copy of both are pasted below:
EXPW1/2CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 35 of 58 EXPW2/D1
37. It is argued by the Ld. Counsel for defendant that defendant received only purchased order EXPW2/D1 through whats APP and purchase order EXPW1/2 is forged. Since as evident from CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 36 of 58 the testimony of PW2 he admitted of posting PW2/D1 on whats App and case of the plaintiff is that defendant staff signed on the purchase order EXPW1/2 therefore onus is upon the plaintiff to proved that same was signed by the defendant staff.
38. PW1 has testified that on 3-4 June, 2022 M.R. Overseas a regulara buyer of the plaintiff company placed an order for 1040 metric tons of Indian Broken rice to be delivered within 30 days at the Container Corporation of India yard in Nagpur, Maharashtra and and subsequently contacted broker Sh. Hemant Sharma who informed the plaintiff about the defendant who could supply the same and Sh. Hemant Sharma assured that they could supply 780 metric tons of rice at Rs. 2125 per quintal out of total 1040 metric tons within 10 days from the date of purchase order. Defendant informed Sh. Hemant Sharma that their office staff would be visiting at Naya Bazar, Delhi on 08.06.2022 and they would meet him in his office to sign the purchase order on 08.06.2022, which he exhibited as Ex. PW1/2.
From the testimony of PW1 it is evident that he has not deposed that any official of defendant actually visited to the office of plaintiff at Naya Bazar to sign the purchase order EXPW1/2 or when said staff visited.
Defendant is a company, therefore, a non living person and thus somebody on behalf of defendant would have talked with plaintiff but plaintiff neither in the pleading nor PW1 in his testimony has deposed who on behalf of defendant informed about visiting of CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 37 of 58 office staff and further PW1 also has not depose on which date Hemant Sharma informed him that defendant staff would be visiting to them and on which day defendant official informed to the Hamant Sharma informed about their staff visiting to plaintiff office.
Further from purchase order EXPW1/2 it is evident that same bears only signature with no name or designation of the person who signed on behalf of defendant. PW1 has not deposed what was defendant staff name or designation who visited to the plaintiff office and signed the purchase order. In his cross examination he at one place stated that he do not know the name of said staff as it is a old transaction then subsequently he depose that he did not enquire the name and designation of the staff of the defendant who signed on the ExPW1/2 which means he deposed falsely that he does not know the name of said person being old transaction as he could not know the name when he did not ask the same from said person. PW1 has not testified that he himself met with the said staff of defendant company.
Further when PW1 was put copy of purchase PW1/D1 he depose that same was sent to Hemant Sharma but he further depose that same does not become purchase order till it signed by defendant official but I am not agree with the same. In my view seller can accept the same by acting upon the same and there is no need to formally signed by seller.
Further PW1 has admitted that signature on purchase order CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 38 of 58 DW1/P1 (which is also PW2/D1 ) is signed by Anuj Sharma plaintiff staff. Since signature of plaintiff side on both PW1/2 and its copy PW2/D1 are same means even purchase order EXPW1/2 was not signed by him, hence he neither is maker of the same nor being witness of the same can prove the PW1/2. Therefore I hold that though purchase order EX. PW1/2 is exhibited but has not been proved by plaintiff, as per Indian Evidence Act. In these circumstances I do not find testimony of PW1 reliable that defendant staff visited to the plaintiff office or purchase order EX. PW1/2 is signed by the defendant staff.
39. As far as testimony of PW2 is concerned, admittedly from the testimony of PW2 he has not deposed that purchase order Ex. PW1/2 has been signed in his presence. PW2 has deposed that after he informed the plaintiff about the defendant's acceptance to supply 780 meteric ton of rice within time frame and after receiving the confirmation from the plaintiff, he communicated to the defendant who informed him that their official(s) travel to Delhi visited around 7-8 June, 2022 to sign the purchase order / contract with the plaintiff but PW1 has deposed that he informed to the Hemant Sharma i.e. PW2 that defendant staff would visit on 8th June 2022. Hence there is contradiction in the testimony of PW1 and PW2 who informed about the visit of defendant staff. He has not also given the name of the person from the side of defendant who has communicated him that their staff would travel to Delhi around 7-8 June, 2022 to sign the purchase CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 39 of 58 order / contract. Further from the aforesaid deposition of PW2 it appears that talks between defendant's official and PW2 Sh. Hemant Sharma would have taken prior to 7-8 June, 2022 as only in that situation defendant official would tell to him that their staff would visit the plaintiff's office at Naya Bazar, Delhi whereas the purchase orders both original Ex. PW1/2 and copy Ex. DW1/P1 which is posted in the whatsapp chat bears the date 08.06.2022. It look highly unlike that plaintiff's office posted the signed copy of purchase order Ex. PW2/D1 bearing date 08.06.2022 on whats app group chat prior to 08.06.2022. PW1 or PW2 did not depose when purchase order PW2/D1 was posted and when PW2 forwarded the same to defendant or its agent Manoj. Further it also look unlikely the plaintiff got formal order from MR overseas on 10.06.2022 but place the purchase order to supply the rice before that 10.06.2022.
Further PW2 has categorically depose that PW1/2 was seen by him in July- August 2023 when he came to Delhi. PW2 was the broker of plaintiff but was unaware of the purchase order EXPW1/2 which means even he was not aware of the condition that goods were to be supplied with in 10 day, which create doubt that condition of supplying goods in 10 days has been filled later on in EXPW1/2. Hence, in these circumstances, I do not find the testimony of PW2 also reliable that defendant staff has signed the purchase order PW1/2 or that it has ever agreed to supply goods with in 10 days.
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 40 of 58
40. As far as testimony of DW1 Sh. Mukesh Khandelwal is concerned, in his examination in chief led by way of affidavit Ex. DW1/A, he has categorically deposed that plaintiff vide purchase order dt. 08.06.2022 which was issued to the defendant company was neither signed by the defendant nor any employee and no period of supply was fixed in this purchase order. In his cross examination he depose that same was received by defendant on 08.06.2022 at 4.48 PM through whats app from its broker Manoj Sharma. Though suggestion has been given to him that there was no broker Manoj Sharma involve in the deal but Manoj Sharma is a broker has been admitted by PW2 in his cross examination as he stated that he used to inform Manoj Sharma about the purchase order and Manoj Sharma used to inform Kapasan agro to deliver the goods as per order. DW1 has denied that PW1/2 was signed by its staff.
41. In view of aboe discussion, in my view plaintiff is unable to extract anything from cross examination of defendant's witness to disbelieve his testimony whereas DW1 is able to prove that defendant has only received purchase order Ex. DW1/P1 through whatsapp and purchase order Ex. PW1/2 was not signed by defendant staff and same was fabricated by plaintiff by entering 10 before days with ulterior motive to create false grounds that defendant had to supply the goods within 10 days probably after receiving the legal notice dt. 06.12.2022 mark PW2/D2 in which defendant demanded Rs. 3111083/- from plaintiff on the ground CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 41 of 58 that plaintiff has suffered losses.
42. In view of above discussion I hold that purchase order Ex. PW1/2 is a forged document. Hence, I decide issue no. 4 in favour of defendant and against plaintiff.
Issue No. 5 : "Whether the time was the essence of the contract between the plaintiff and the defendant ? OPP"
43. In view of my findings in issue no. 4 that purchase order Ex. PW1/2 which contains the terms that the goods are to be supplied within 10 days is not actual purchase order given to defendant but actual purchase order which was supplied to the defendant through whatsapp Ex. DW1/P1which does not contain any such condition, therefore, plaintiff has failed to prove that it communicated to the defendant that goods has to be supplied by the defendant to plaintiff within 10 days.
44. Further PW1 has not deposed that it ever supplied to defendant about the order placed by MR overseas or even brought to the knowledge of defendant about the said purchase order. Even PW2 has not deposed that it has knowledge about the purchase order EXPW1/2. He has categorically depose that same was seen by him in July- August 2023 when he came to Delhi. Hence said purchase order was not even supply to him by plaintiff though PW2 was there broker, hence, it clearly proved that time was not essence of the contract in strict sense that goods is to spplied with in 10 days only though it is always expected to supply goods in CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 42 of 58 the reasonable time particularly when it relate to export and that too of foods article. Issue no. 5 is decided accordingly against the plaintiff.
Issues No. 2: Whether the plaintiff has failed to make the due payment of Rs. 31,11,083/- of goods already supplied by the defendant to the plaintiff, if so what effect ? OPD
45. The onus to prove this issue is upon the defendant. The DW1 has testified that defendant supply 470 metric ton of broken rice amounting to Rs. 9973687/- and plaintiff made Rs. 68,62,604/-, thus, leaving a balance of Rs. 31,11,083/-. He has proved the 17 invoices as EXDW1/3A to EXPW1/3Q raised by defendant qua said supply and also proved ledger maintained by defendant qua goods supplied to plaintiff as PW2/D3. Plaintiff has given no suggestion to DW1 that said goods were not supplied or that any entry in the aforesaid ledger is fabricated.
46. Further from the plaint itself it is evident that plaintiff has admitted that defendant has supplied 17 containers of rice and the plaintiff has paid only Rs. 68,62,604/-, thus, leaving a balance of Rs. 31,11,083/- as demanded by the defendant through its legal notice and only stated that plaintiff is entitle to adjust said amount from the losses suffered by plaintiff due to non supply of reaming quantity of broken rice. Hence, this fact remained undisputed that plaintiff has a balance of Rs. 3102500/- for the goods supplied by the defendant to the plaintiff and not Rs. 3111083. As far as its effect is concerned, I will discuss the same in issue no.3. Issue CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 43 of 58 no.2 accordingly decide against the plaintiff.
ISSUE No3 : "Whether the defendant is entitled to stop delivery of the further goods in view of failure of the plaintiff to pay the balance amount of goods already supplied ? OPD"
and Issue No. 6 : Whether the defendant failed to supply the remaining 13 containers of rice to the plaintiff and by the said act caused financial loss to the plaintiff ? OPP
47. Plaintiff in the plaint as well through the testimony of PW1 has stated that defendant supplied 17 container ( 442 Meteric ton ) of broken rice. Though DW1 in his testimony has stated that it supplied only 17 containers i.e. 470 meteric ton of broken rice but on perusal of Writtten statement file by defendant I found that defendant has not denied the averment made in the plaint that it supplied 442 meteric ton of rice in 17 container. Hence testimony of DW1 cannot be accepted as same is contrary to its pleading. Therefore I hold that defendant has supplied only 442 meteric ton of rice.
48. Though there is dispute between plaintiff and defendant how much quantity of goods was ordered by plaintiff as according to plaintiff its order 780 metric ton of broken rice but according to defendant only 750 metric ton of rice was order but as held in issue no.4 plaintiff only place purchase order dt. 08.06.2022 EXPW2/D1 through whatsapp. In the said purchase order the CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 44 of 58 quantity is mentioned as 780 metric ton. Undoubtedly there is overwriting where quantity is written but since defendant has admitted of receiving of the said purchase order, therefore, if any alteration is done in quantity same was done prior to receiving of purchase order by the defendant and defendant had not stated that he raised any objections against said alteration before supplying of the goods, therefore, I held that plaintiff has ordered 780 metric ton of rice whereas defendant has supplied only 442 metric tons of rice. Hence I hold that defendant did not supply 338 metric ton of broken rice.
49. From the testimony of PW1 and DW1 it remained undisputed fact that total cost of aforesaid goods supplied by defendant to plaintiff is Rs. 9973687/- but plaintiff has only paid Rs. 6862604/-, thus, leaving balance of Rs. 3111083/-.
50. Now the question is whether defendant has any legally valid justification not to deliver the remaining quantity of the goods until the said balance payment of already supplied goods is paid by plaintiff. If not whether due to the non supply of remaining 338 metric ton of rice plaintiff suffer any loss and whether plaintiff is entitle to recover the same from the defendant.
51. It is argued by Ld. Counsel for plaintiff that defendant is bound to supply entire quantity of goods as ordered by plaintiff and cannot stop delivery because part payment of goods were not made because entire order was single order, whereas it is argued by Ld. Counsel for defendant that though purchase order was CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 45 of 58 single but since there was huge quantity of goods plaintiff was required to pay the amount of each shipment of goods with in 7- 10 days of receiving the goods and since plaintiff did not pay the same therefore defendant has right not to supply remaining goods till balance payment is made.
52. Part IV of Sale of Goods Act 1930 deals with supplies of goods. Relevant sections are as under :
Section 31: Duties of seller and buyer.
It is the duty to the seller to deliver the goods and of the buyer to accept and pay for them, in accordance with the terms of the contract of sale. Section 32: Payment and delivery are concurrent conditions. Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer shall be ready and willing to pay the price in exchange for possession of the goods.
Section 34 :Effect of part delivery A delivery of part of goods, in progress of the delivery of the whole, has the same effect, for the purpose of passing the property in such goods, as a deliv- ery of the whole; but a delivery of part of the goods, with an intention of sev- ering it from the whole, does not operate as a delivery of the remainder. Section 34: Instalments deliveries.
(1) Unless otherwise agreed, the buyer of goods is not bound to accept deliv-
ery thereof by instalments.
(2) Where there is a contract for the sale of goods to be delivered by stated instalments which are to be separately paid for, and the seller makes no delivery or defective delivery in respect of one or more instalments, or the buyer neglects or refuses to take delivery of or pay for one or more instalments, it is a question in each case depending on the terms of the contract and the circumstances of the case, whether the breach of contract is a repudiation of the whole contract, or whether it is a severable breach giving rise to a claim for compensation, but not to a right to treat the whole contract as repudiated.
Section 45 : "Unpaid seller" defined.
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 46 of 58 (1) The seller of goods is deemed to be an "unpaid seller" within the meaning of this Act--
(a) when the whole of the price has not been paid or tendered;
(b) when a bill of exchange or other negotiable instrument has been received as conditional payment, and the condition on which it was received has not been fulfilled by reason of the dishonour of the instrument or otherwise.
(2) In this Chapter, the term "seller" includes any person who is in the position of a seller, as, for instance, an agent of the seller to whom the bill of lading has been endorsed, or a consignor or agent who has himself paid, or is directly responsible for, the price. Section 46 : Unpaid seller's rights.
(1) Subject to the provisions of this Act and of any law for the time being in force, notwithstanding that the property in the goods may have passed to the buyer, the unpaid seller of goods, as such, has by implication of law
--
(a) a lien on the goods for the price while he is in possession of them;
(b) in case of the insolvency of the buyer a right of stopping the goods in transit after he has parted with the possession of them;
c) a right of re-sale as limited by this Act.
(2) Where the property in goods has not passed to the buyer, the unpaid seller has, in addition to his other remedies, a right of withholding delivery similar to and co-extensive with his rights of lien and stoppage in transit where the property has passed to the buyer.
53. From the aforesaid provisions of Sale of Goods Act it is evi- dent that even if part delivery is made by the seller and said deliv- ery is accepted by the buyer then it is bound to pay the amount of goods supplied by the seller and if buyer does not pay the amount then seller has right to stop delivery of remaining goods not sup- plied or in transit. In this regard I rely upon M/S Klg Systel Ltd. vs M/S Fujitsu Icim Ltd. AIR2001DELHI357, Hon,ble High CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 47 of 58 Court has dealt about part delivery. The relevant para of the judgement are as under:
"12. The disputes between the parties cannot be decided do hors the sundry provisions of the Sale of Goods Act. Part-payment to a substantial extent has been made by the Defendant/Applicant. When a buyer such as the Defendant/Applicant asserts that the merchandise/goods were defective, it is not open to it to withhold payment once the delivery is accepted; since they are deemed to have been accepted by operation of law. In Nagandas Mathuradas vs. N.V. Valmamohomed and Others, AIR 1930 Bombay 249, in the opinion of the Bench, the Buyer was playing fast and loose inasmuch as the initial credit entry recorded in favor of the Seller was subsequently reversed. The fact that a substantial part payment had been made by the Defendant to the Plaintiff was found very relevant, in this context. It reiterated the view approved by the House of Lords that "if a buyer orders goods of a certain description, and the seller delivers goods of a different description, it is open to the buyer to reject them. But if he does not reject them but keeps the goods, even if he does so in ignorance of the fact that they are of a description different from that provided for by the contract he is debarred from rejecting the goods thereafter, and can only fall back upon a claim for damages, as upon a breach of warranty." These observations apply, a fortiori, where the goods supplied were according to the specifications, and their price had been substantially paid. Autovesl and Isogen were ordered by name, and were supplied. Due to reasons of obsolescence, Pvelite was subsequently preferred by the Defendant, but this preference cannot be considered as a valid defense for withholding payment. It would still be so even if either Autovesl or Isogen proved to be of little usefulness to the Defendant, so long as what was supplied strictly corresponded to these two programmes/merchandise. Chapter IV of the Act must be kept in mind when disputes of the present nature call to be decided. In particular, Section 34 envisages that delivery of even a part of the goods would operate as a delivery of the whole, unless the former is clearly severed from the rest. The Defendant/Applicant should have recorded a caveat that the software could be treated as having been accepted only upon delivery of Pvelite. This could not be possible since Pvelite was not part of the contract. Alternatively, the Defendant/Applicant could have declined to accept the part delivery if that is how it viewed the situation. The intervening period of several months is significant and clearly fatal to the projected defense. The offer to supply Pvelite cannot have the effect of invalidating the initial contract.
54. Now reverting back to the case, though plaintiff through testimony of PW1 has tried to prove that plaintiff is not liable to CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 48 of 58 pay the price of goods unless delivery of remaining rice as order in purchase order dt. 08.06.2022 is made by the defendant. It is undisputed fact that defendant has already supplied only 470 metric ton of broken rice out of 780 metric ton in 17 container. It is not the defense of plaintiff that it refused to take the delivery of the said goods unless remaining goods are supplied by the defendant. As far as contention of learned counsel for plaintiff that there was no agreement between parties that payment of delilvered rice is to be made within seven days. From the testimony of PW2 Sh. Hemant Sharma who is broker of plaintiff and examined by plaintiff itself as witness has categorically admitted that as per whatsapp chat the payment is to be made within 7 days, though he voluntarily stated that the payment is to be made in 7-10 days. Even if I accept his voluntarily portion the payment is to be made by plaintiff within 7-10 days. Further, PW1 himself admitted that plaintiff made payment of Rs. 68,62,604/-, which means plaintiff has made part payment of the rice already delivered by the defendant to the plaintiff, therefore, it support the testimony of DW1 plaintiff was required to pay payment of the goods already received by the plaintiff within 7-10 days on receipt of goods but plaintiff did not pay the same and a quite substantive amount i.e. Rs. 3111083/-. It is not the case of the plaintiff that period of 7-10 days has not expired from the delivery of the goods by the defendant to the plaintiff, therefore, in my view, plaintiff himself violated the agreed terms, hence, defendant's action for not making further delivery of the goods i.e. rice was legally vaild CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 49 of 58 and justified as no seller would like to deliver the goods to buyer who is already in default in payment of the previous delivery of the goods. Hence, I held that since plaintiff has failed to make the balance payment of goods already supplied by the defendant to the plaintiff within stipulated time of 7-10 days, the defendant is entitled to stop delivery of the further goods in view of section 46 of sale of goods Act as he become unpaid seller.
55. In view of aforesaid discussion I hold that though plaintiff has able to prove that defendant did not supply supplied 338 Meteric ton of broken rice out of 780 metric ton of rice but at the same time I hold defendant has legal right to stop the delivery of remaining 338 Meteric Ton as plaintiff has not made the complete payment of goods already supplied being unpaid seller.
56. Now the question whether plaintiff has suffered any loss due to non-supply of remaining goods. Plaintiff has stated in the plaint that due to failure of the defendant in performing his part of the obligation undertaken by him as per purchase order placed by the plaintiff which resulted in defendant suffering losses to the tune of Rs. 60,09,406/-, however, it is further stated in the plaint that as per assessment of the plaintiff on the day sending of reply of the demand notice of defendant, the plaintiff has suffered loss of Rs. 57,74,650/- and further stated that plaintiff was laden with the liabilities to the tune of Rs. 58,07,086/- as detention, ground rent and differences in Ocean Freight Charges towards which the buyer of the plaintiff raised a debit note dated 21.03.2023 to the CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 50 of 58 plaintiff.
57. Onus is upon the plaintiff to prove that it suffer aforesaid losses. According to testimony of PW1 due to non supply of complete quantity of 780 meteric ton Rice by defendant it could not complete the order of supply of 1040 Ton of said rice given by MR Overseas on time therefore MR overseas raised a debit note for Rs. 7243786/- to plaintiff for detention, ground rent and difference in ocean price which it settled with MR overseas for Rs. 5807086/- hence after adjusting the payment which is to be made by plaintiff to defendant for goods supplied the plaintiff has to recover a sum of Rs. 898323/- as principal and 391272/- as interest. PW1 has only proved the purchase Order EXPW1/1 given by MR Overseas to supply 1040 metric ton of rice and also proved debit note as PW1/6.
58. PW1 in his testimony has not deposed that they have asked the MR overseas how MR overseas calculated the amount of Rs. 5807086/-. As per the purchase order mark Ex. PW1/3 & Ex. PW1/4 given by MR Overseas to plaintiff both dt. 10.06.2022, the goods was to be loaded within 30 days and after all detention and expenses charges will be on plaintiff's account. Neither PW1 has deposed that plaintiff asked documents from the MR Overseas with respect to the said amount. He has relied upon debit note Mark PW1/6 later on exhibited as PW3/4. On perusal of debit note MR overseas raised to the Plaintiff company it is evident that ground Rent as Rs. 827590/- and remaining is export CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 51 of 58 expenses. It is not mentioned in the debit note that said ground rent or export expenses is incurred by M.R. Overseas due to delay in completion of order by plaintiff. It does not mentioned that said ground rent is for which period and at what rate said ground rent rent has been calculated and who has taken claimed ground rent from MR overseas. No other documents has been file or proved by the plaintiff how MR overseas calculated Rs. 7243786/- for detention, ground rent which plaintiff settled for Rs. 5807086/- .
59. Even PW3 Sh. Rohit Arora, Director of M.R. Overseas, has admitted that it extended time to deliver rice till 31.8.022 on 21.07.2022 and supplied the 1031.25 Meteric ton by 29.08.2022 and remaining quantity was adjusted but due to delay MR overseas suffered losses to the tune of Rs. 73 lakh and on request of plaintiff same was reduce to Rs. 5807086/-. plaintiff said debit note is not mentioned in GST Return. Though as per GST Act, if any debit note is raised same is required to be reflected in the GST Return. Admittedly not a single penny has been paid by plaintiff to MR overseas and plaintiff is waiting to pay the same after receiving said amount from defendant. If I presume that plaintiff has to pay said amount to MR overseas, plaintiff has to recover only Rs. 2898323 from defendant with interest if plaintiff win the case but it has to pay Rs. Rs. 5807086/- to the MR overseas which was not admittedly not paid till date. therefore, in these circumstances, it appear that fake debit note EXPW3/4 has been raised by MR Overseas probably at the asking of plaintiff CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 52 of 58 company official,so that it could avoid payment of goods which defendant has supplied to the plaintiff and it appears that that is why plaintiff has not chosen to contest the said amount claimed by MR overseas, as it appears that both plaintiff and MR overseas official are hand in glove and plaintiff himself has procured said debit note from M.R. Overseas to avoid payment of amount of goods of approx. 31 lakh, which is evident from the fact that M.R. Overseas did not raise any debit note from 11.07.2022 till 21.03.2023 and even did not insisted for payment of said amount and agreed to wait till recovery is made by plaintiff from defendant. It appears to be too much concession given by MR Overseas to plaintiff company and again strengthen my view that said debit note has been procured by plaintiff from MR Overseas to avoid payment to defendant of the goods supply be defendant to plaintiff. In these circumstances I do not find testimony of PW1 & PW3 reliable that MR overseas has suffered losses as it paid 7243786/- for detention, ground rent which was caused due to delay supply of goods by plaintiff and thus suffer said amount as loss and entitle to raise debit note of Rs. 5807086/- to plaintiff and thus plaintiff suffered said financial loss.
60. In view of aforesaid discussion, I sum up the issue no.3 &6 as defendant did not supply 338 Meteric ton of broken rice to plaintiff out of total 780 meteric ton of rice. Defendant is entitle to stop delivery of said remaining quantity of goods till plaintiff pay the balance amount of goods already supplied being unpaid seller CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 53 of 58 and thirdly plaintiff has failed to proved that it suffer any loss due to non-supply of remaining rice by defendant. Issue no.3 & 6 are decided accordingly ISSUE No.7 : "Whether the plaintiff is entitled to decree for recovery of suit amount of Rs. 32,89,595/- ? OPP"
61. As evident from the plaint, plaintiff has claimed recovery of Rs. 3289595/- which a include Rs. 2898323/- as principal and 391272/- as interest as compensation due to breach of contract by defendant as he did not supply the broken rice with in agreed time.
62. Section 73 of the Contract Act, 1872 provides for compensation for loss or damage caused due to breach of contract, which is reproduced as below :-
Section 73. Compensation for loss or damage caused by breach of contract.
When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it. Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach.
Compensation for failure to discharge obligation resembling those created by contract. When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract.
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 54 of 58
63. Further, Section 74 of the Contract Act provides the penalty for breaching of the contract where it is stipulated for, which is reproduced as below :-
46. Section 74. Compensation for breach of contract where penalty stipulated for.
1[When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for.
64. In view of my finding of aforesaid issues, in my view, as plaintiff has failed to prove he suffered any loss due to non-supply of 338 metric ton of rice out of total 780 metric rice, therefore, he would not entitle to recover any amount but even if I presume that plaintiff has suffered the financial losses due to defendant non- supplying the remaining 13 containers of rice i.e. 338 metric ton of rice to the defendant, it cannot be said that said loss was caused to the plaintiff due to non-supplying of the goods by the defendant but it was suffered by the plaintiff as it did not made complete payment of the goods already supplied by the defendant and thus defendant has legally valid reason and justification not to make delivery of remaining goods. Hence even if plaintiff has suffered said loss defendant is not liable to pay the same as defendant was exercising its right given under section 46 of Sale of goods Act by not delivering remaining goods till payment of CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 55 of 58 goods supplied is already received.
65. Further as per section 73 of Contract Act plaintiff will be entitled to compensation only for the differences of the prices if plaintiff was forced to buy rice at higher prices from the market when the rate on which defendant had to supply the same to the plaintiff. From purchase order PW2/D1 it is evident that purchase order contain specific condition that in case delivery of goods has not been made within stipulated time, then difference will be charged, the relevant terms of the same is reproduced as below :-
"If delivery of goods has not been given on the above time or it is not been according to sample our purchase order stands cancelled and difference will be charged by you at market price"
66. Thus, as per purchase order EXPW2/D1 from the aforesaid terms it is evident that plaintiff can only claim difference of the price on which plaintiff was forced to buy the rice from the open market if same is higher than on what rate on which same was supplied by the defendant to the plaintiff as per averment made by the plaintiff in plaint and not the amount of Rs. 5807086/- as claimed by plaintiff as there is stipulation in the purchase order that defendant would be liable to ground charges, detention charges or any other which plaintiff would have to pay to MR overseas due to delay in supply of rice.
CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 56 of 58
67. PW1 has testified that due to non-supply of the goods by the defendant, the plaintiff was constrained to procure the remaining 13 containers ( 311 meteric ton) of rice from the open market at the rate of 2180 per quintal thereby causing a loss of Rs. 55 per quintal to the plaintiff thereby constraining the plaintiff an extra amount of Rs. 1,82,320/- and further an amount of Rs. 20,000/- as transportation / freight charges in procuring the said goods. Hence, at the best plaintiff would be entitled a sum of Rs. 1,82,320/- + Rs. 20,000/- as transportation / freight charges from the defendant even if I presume that it was the defendant who was responsible for breaching of the contract though he was not as held above. I would like to say that plaintiff has not prove any document that it purchase remaining 13 containers of rice from the open market at the rate of 2180 per quintal. Therefore plaintiff has even failed to prove that he is entitle to recover even Rs. 202330/-.
68. In view of aforesaid facts and circumstances, I held that plaintiff has failed to proved that it is entitled to recover any compensation from the defendant due to non supply of 338 Meteric ton of rice. Issues No. 3, 6 & 7 are decided accordingly.
ISSUE No.8 : "Whether the plaintiff is entitled to pendentelite and future interest, if so, at what rate ? OPP"
69. In view of my findings in aforesaid issues that plaintiff is CS (COMM) NO. 1458/23, Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 57 of 58 not entitle to recover any amount from the defendant no question of grant of any interest arise. Issue no. 8 is decided accordingly.
Relief
70. In view of my finding of aforesaid issues no. 2 to 8, I held that plaintiff is not entitled to recover any amount from defendant, hence, plaintiff is not entitled to any relief. Thus, the suit of plaintiff is dismissed with costs. Decree sheet be prepared accordingly.
File be consigned to record room.
Digitally signed by
SANJEEV
Pronounced in open Court KUMAR
SANJEEV KUMAR
AGGARWAL
on 13.11.2024. AGGARWAL Date: 2024.11.13
17:53:00 +0530
(Sanjeev Kumar Aggarwal)
District Judge (Commercial Court)-01,
Central, Tis Hazari Courts, Delhi.
CS (COMM) NO. 1458/23,
Rameshwar Lal Foods Pvt. Ltd. Vs. M/s Kapasan Agro Pvt. Ltd. Page No. 58 of 58