Delhi District Court
Sanjeela Fashions Pvt Ltd vs Taruna Bansal, Prop. Of M/S Taruna ... on 21 April, 2025
BEFORE THE COURT OF SH. SURINDER S. RATHI, DISTRICT JUDGE
(COMM.)-11 CENTRAL, THC, DELHI
CS Comm. No.05/2022
Sanjeela Fashions Pvt. Ltd.
At: 765, 1st Floor, Katra Neel,
Chandni Chowk, Delhi-110006 .........Plaintiff
Vs.
M/s Taruna Textiles
At:WZ-1819, Ground Floor
Multani Mohalla, Rani Bagh
Saraswati Vihar, Northwest Delhi-110034
Also At:
673, II Floor Gali Ghanteshwar,
Katra Neel, Chandni Chowk, Delhi-110006 ........Defendant
Date of Institution : 03.01.2022
Date of Final Arguments : 21.04.2025
Date of Judgment : 21.04.2025
Decision : Dismissed
Judgment
1. This suit has been filed by plaintiff company for recovery of
Rs.15,57,406/- alongwith interest (rate not specified) as unpaid dues of
goods sold apart from seeking recovery of Rs.1.50 lakhs as litigation
charge. However, relief of recovery of litigation charge was not pressed
during final arguments as per instructions of the plaintiff company. Pre-
suit interest not sought.
Case of the Plaintiff
2. Case of the plaintiff as per plaint and the documents filed is that it is a
duly incorporated private ltd. Company at Chandni Chowk, Delhi and is
in the business of trading of women's clothing like sarees, lehngas,
designer suits etc with a good reputation in the market. In the course of
CS Comm No.05/2022 page 1
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
business defendant who is proprietor of M/s Taruna Textiles approached
the plaintiff for carrying on business in January 2017 by ordering
material. The goods were supplied through several invoices between dates
21.01.2017 to 21.02.2017 cumulatively valuing to Rs.23,67,125/-.
However, one article worth Rs.33,145/- was returned. It is pleaded that
defendant paid only Rs. 5 lakhs leaving the outstanding debit balance at
Rs.18,67,125/-. Despite assurance of paying the same within time the
payment was not made. There is reference to some cheques drawn by the
defendant and that they were dishonored but plaint does not carry any
details.
3. However, the business between the parties continued. The plaint is drafted
in a highly ambiguous manner which gives an impression that the
oustanding of Rs.18,67,125/- continued since February 2017 but it is
orally submitted that more sales were made and payments received on
account. Without explaining any details it is pleaded that the last
outstanding was Rs.15,57,406/- as on 24.11.2020. Plaintiff, thereafter,
sent a legal demand notice on 30.07.2021 which was neither replied nor
complied despite service at defendant's residential address as available on
GST portal. The plaint is silent if Pre-Institution mediation was carried
out as per Section 12A of Commercial Courts Act, 2015 or not.
However, it is submitted that Non-Starter Report was issued by Central
DLSA on 15.12.2021 where defendant did not participate. In this
backdrop suit in hand was filed for following reliefs:
Prayer:
i. Pass a decree for a sum of Rs.15,57,406/- along with pendente-lite and future interest
till the actual realization of the said amount, in favour of the plantiff and against the
defendant.
ii. Pass an award for Rs.1,50,000/- as litigation charges including the court fee & the
counsel fee in favour of the plaintiff and against the defendant.
iii. Pass any other order or directions which this Hon'ble Court may deem fit and proper
in the present facts and circumstances of the case, in the interest of justice.
CS Comm No.05/2022 page 2
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
4. Second relief abandoned during the course of final arguments.
5. Summons of the suit was served upon the defendant on 29.04.2022 and
WS was filed on 19.05.2022.
Defendant's case
6. In the WS filed by the defendant she has prayed for dismissal of the suit
on the ground that it has not been drafted as per Commercial Court Act .
Dismissal of the suit is also prayed on the ground that the suit is based on
false and concocted facts. Authority of plaintiff's director to file this suit
is also questioned. Objection qua jurisdiction of Commercial Court to
hear this case is also taken on the ground that both the plaintiff and
defendant are members of Delhi Hindustani Mercantile Association and
are governed by Arbitration Clause as reproduced in several bills.
However, no application under Section 8 of Arbitration & Conciliation
Act, 1996 was filed. Dismissal of the suit is also prayed on the ground
that the suit is barred by limitation. It is pleaded that the last transaction
took place on 23.08.2018 and the suit was filed in January 2022. This plea
has been taken unmindful of freeze on the limitation by Hon'ble Supreme
Court in "In Re: Cognizance For Extension of Limitation" Suo Motu
Writ Petition (C) No.3 of 2020" dated 10.01.2022 in cognizance of
extension of limitation from 15.03.2020 to 28.02.2022.
7. It is further pleaded that plaintiff has not approached this Court with clean
hands and has suppressed material facts. It is, however, accepted that she
had business relations with the plaintiff since long but claimed that all the
accounts between them were cleared in the end of February 2020 and now
nothing remains due or payable. It is pleaded that since plaintiff used to
supply material even though no demand was raised she stopped
purchasing goods from it. It is pleaded that plaintiff had created forged
and fabricated invoices to show sale of goods which were never supplied
CS Comm No.05/2022 page 3
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
to her and none of the invoices bear signatures of plaintiff's director or
AR.
8. As far as merits of the case are concerned, it is denied by the defendant
that plaintiff is a private ltd. Company at Chandni Chowk. It is not denied
that plaintiff is dealing in ladies clothes. It is denied that plaintiff company
has a Director by the name Sh. Suryakant Singhal or he is authorised to
file this suit. Defendant accepts that she is proprietor of M/s Taruna
Textiles and has been carrying out purchase of material from the plaintiff.
It is pleaded that all sales were made with a three month credit
understanding.
9. It is not denied that defendant purchased goods worth Rs.23,67,125/-
between 21.01.2017 to 21.02.2017 and paid only Rs. 5 lakhs leaving debit
balance of Rs.18,67,125/-. She denied that she was irregular in making
payments. She denied issuance of cheques or that they were dishonored.
As per her she has already paid all that was payable and due. It is pleaded
that as per ledger filed by the plaintiff defendant is shown to be having a
debit balance of Rs.90 lakhs at one point and is shown to have made the
entire payment except the suit amount of Rs.15 lakhs. It is pleaded that
the suit is based on forged invoices. She claims to have paid Rs.50,000/-
on 24.11.2020 but it was not to clear the dues but was advance for some
standalone purchase. She denied receipt of legal notice. With these pleas
she prayed for dismissal of the suit.
10.In her affidavit of admission -denial to plaintiff's documents she has
denied all the invoices, copy of ledger statement, legal notice etc.
Replication
11.No replication was filed.
12.Upon completion of pleadings following issues were identified by Ld.
Predecessor on 12.05.2023:
CS Comm No.05/2022 page 4
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
Issues:
1. Whether the Court has jurisdiction to entertain the suit filed by plaintiff?
(OP -Parties)
2. Whether the plaintiff is entitled for decree of recovery of Rs.15,57,406/-
against the defendant, as prayed for? (OPP)
3. Whether plaintiff is entitled for interest. If yes, at what rate and for which
period? (OPP)
4. Relief
Evidence
13.To prove his case plaintiff company examined PW1 Surya Kant Singhal,
Director/AR of the plaintiff company. Vide affidavit Ex.PW1/A he
deposed on he lines of plaint and exhibited following documents:
Sl. Documents Exhibits
No.
1. Original Board Resolution. Ex.PW1/1
2. Copy of ID proof of the deponent. OSR Ex.PW1/2
3. Original Memorandum & Article of Association & Certificate of Ex.PW1/3 (Colly.)
Incorporation.
4. True Copy of Form No. DIR-12. Ex.PW1/4 (Colly.)
5. Copies of relevant invoices. OSR Ex.PW1/5 (Colly.)
6. True Copy of Ledger Account. Ex.PW1/6 (Colly.)
7. Legal Notice dated 30.07.2021. Ex.PW1/7 (Colly.)
8. Postal Receipt of notice dated 30.07.2021. Ex.PW1/8
9. Unserved Notice along with the envelope. Ex.PW1/9
10. Tracking Records of both the notices. Ex.PW1/10(Colly.)
11. True Copy of record reflecting on the GST portal. Ex.PW1/11
14.He was cross-examined at length by Ld. Counsel for defendant wherein
he stated that the plaintiff company has five directors including himself.
He denied the suggestion that he is not authorised by the Board to file this
suit. He accepted the suggetion that the plaintiff company is reigstered
with Delhi Hindustani Mercantile Association for arbitration and the
invoices issued between dates 21.01.2017 to 03.04.2017 has a printed
CS Comm No.05/2022 page 5
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
stipulation which reads "All disputes are subject to Delhi Hindustani
Mercantile Association". He accepted that the business between the
parties started in 2017 with a credit period understanding of 45 days.
Initially, defendant started paying invoice wise but subsequently started
delaying the payments. He accepted that no purchase orders were received
from defendant as she used to visit the plaintiff's shop with her husband
Deepak Goel for making the purchases. All the invoices were prepared by
plaintiff company's Accountant which bears his signature and in his
absence his accountant used to sign. He accepted the suggestion that from
page 80 onwards invoices Ex.PW1/5 contains GST no. of both plaintiff
and defendant.
15.He also accepted the suggestion that there are several invoices from page
no. 451 to 843 in the Court file do not bear signatures of either of the
parties. He also accepted that several invoices which are around 84
invoices do not bear signatures of the defendant but he added that the
signatures appearing thereon may be of defendant's husband or her
employee. He denied the suggestion that no goods were supplied to the
defendant through invoices Ex.PW1/5 (colly.). Evidently, this suggestion
is beyond pleadings because it is not the case of the defendant that he
never received any goods through all the bills filed by the plaintiff, as
only few bills are disputed. He denied the suggestion that the bills filed by
the plaintiff are forged and fabricated. He also denied the suggestion that
defendant has cleared all the dues and now nothing is due and payable or
that payment of Rs.50,000/- made on 24.11.2020 was made towards
advance payment.
16.As per PW1 since both the sides were neighbours he used to make oral
demand and no written letter was sent. He accepted that there is no
written agreement between the parties for payment of interest on delayed
CS Comm No.05/2022 page 6
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
payments. He added that as per market customs plaintiff is entitled to 18%
interest. Goods were supplied by the plaintiff company either to the
defendant shop or to third party buyers who were clients of the defendant
directly. He accepted that no separate parcel received qua such sales have
been filed. He denied that no legal notice was sent by the plaintiff.
17.Second witness examined by the plaintiff is PW2 Shubham Singhal who
is son of PW1. Vide his affidavit Ex.PW2/A he deposed on the lines of
plaint and stated that he is working with the plaintiff company for the last
9 years and is aware of the relevant facts as he used to deal with defendant
on behalf of the plaintiff. He used to not only show the garments to the
defendant but also ensure supply of orders placed by her either to her or to
defendant's clients as per her instructions. It is deposed that defendant
was irregular in payments and he used to make partial payments.
18.In his cross-examination he stated that he does not have any designation
in the plaintiff company but he is B.com graduate and is income tax
assessee since the age of 18. As per him his name was entered in the list
of witnesses but no separate board resolution is filed for his becoming a
witness. He added that defendant and her husband Deepak Goel used to
place orders after selection of the material. The goods were delivered to
the defendant by plaintiff company's staff. He accepted that no written
instructions were received from the defendant to supply goods to third
party clients of the defendant. He denied the suggestion that no business
took place between the parties after February 2020 or that Rs.50,000/-
was paid as advance.
19.Third witness examined is PW3 Manjay Goswami, another employee of
plaintiff. Vide his affidavit Ex.PW3/A he deposed on the lines of plaint
and stated that he is serving the plaintiff company for the last 24 years. He
added that he used to show material to the defendant and goods were
CS Comm No.05/2022 page 7
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
delivered to the defendant's address and defendant's clients as per
instructions.
20.In his cross-examination he stated that he is serving defendant company
since 2000. He stated that Mr. Raja is Accountant of the company and he
is the sales person. He added that defendant is a broker who used to
purchase material from the plaintiff and sell it to her clients. Deliveries
were made either to the defendant or her employees as well against
signatures. He stated that many a time defendant used to make payment in
cash against receipts one copy of which used to be given to defendant and
due entry were made in the ledger qua them. He denied the suggestion
that no entries were made in the ledger qua cash.
21.Defendant did not examine any witness in her defence and refrained from
stepping into the witness box.
22. I have heard arguments of Ms. Kriti Krishana, Ld. Counsel for plaintiff
and Sh. Kapil Singhal, Ld. Counsel for defendant. I have perused the
case file carefully.
23.Now I shall dispose of individual issues framed in this case.
Issue No.1:
i. Whether the Court has jurisdiction to entertain the suit filed by plaintiff? (OP
-Parties)
24.As far as this issue is concerned, as per Ld. Counsels for parties they are
on the same page as regards the pecuniary and territorial jurisdiction but
this issue was framed on the objection of defendant that there existed a
binding arbitration clause. While oepning his submissions in this regard
Ld. Counsel for defendant submits that the invoices filed by the plaintiff
with the suit carried an endorsement at the bottom which read "all
disputes are to be decided by Delhi Hindustani Mercantile Association
Delhi". Admittedly, Ld. counsel for defendant never moved any Section 8
A&C Act application to stress on this clause.
CS Comm No.05/2022 page 8
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
25.Law in this regard is well settled. In case titled Anis Ahmad S/o Zahir
Ahmad vs. Hongkong and Shangai Banking, 122 (2005) DLT 123,
dated 15.07.2005 wherein it is held that:
5. Section 8 of the Arbitration and Conciliation Act, 1996 is important to read in
this context which is extracted below:-
Power to refer parties to arbitration where there is an arbitration agreement.-(1) A
judicial authority before which an action is brought in a matter which is the
subject of agreement shall, if a party so applies not later than when submitting his
first statement on the substance of the dispute, refer the parties to arbitration.
2.The application referred to in sub-section (1) shall not be entertained unless it is
accompanied by the original arbitration agreement of a duly certified copy thereof.
3. Notwithstanding that an application has been made under sub-section (1) and
that the issue is pending before the judicial authority, an arbitration may be
commenced or continued and an arbitral award made.
26.In case titled Nemai Chandra Roy Karmakar Alias Nemai Roy vs.
Sarada Construction, 2023 Latest Caselaw 3586 Cal dated 19.05.2023
wherein Hon'ble Calcutta High Court held that:
According to judicial precedent, conditions of provisions of Section 8 of the Act,
1996 are fulfilled in the following facts and circumstances:-
A. There must be an arbitration agreement or an arbitration clause between the
parties.
B. Either of the parties filed a case against the other party before the Judicial
Authority.
C. Subject matter of the case and that of the arbitration agreement are same.
D. Either of the parties moves the court seeking a reference to arbitration before
submission of first statement. Issue no. A
27.As such in the absence of any Section 8 application the jurisdiction of
Commercial Court in terms of Section 9 CPC does not get ousted. Even
otherwise as per Ld. Counsel for plaintiff the above stipulation is not
present on all the invoices but was available only on initial few invoices
Ex.PW1/5 (Colly.)
28.Be that as it may the law with regard to such stipulations by Hindustani
Mercantile Association is now well settled and Division Bench of Hon'ble
High Court of Delhi has opined that mere entering a stiuplation at the
bottom of invoice without any signature qua accepting the terms cannot
CS Comm No.05/2022 page 9
Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
be made a ground to conclude that there is a binding contract. For ready
reference the relevant text is reproduced hereunder:
29.In case titled Parmeet Singh Chatwal And Ors. Vs. Ashwani Sahani,
2020 Latest Caselaw 1007 Del, Hon'ble High Court of Delhi held, as
under:
"25. In above cited case, perusal invoice shows that it is not clear as to whether
the petitioner who is the proprietor of the said Mahima Exports has signed the
invoice or it has been signed on his behalf by some other entity. That apart, the
manner of signing indicates that the person is only signing receipt of the goods
rather than agreeing to the arbitration agreement between the parties. In my
opinion, the manner in which the signatures have been affixed on the invoice
does not indicate an intent on the part of the petitioner agreeing to settle their
disputes through arbitration.
The so called Arbitration Clause is reproduced in a small font at the bottom of
the invoice. It is doubtful if the petitioner even noticed that he was signing a
document which has an Arbitration Clause. It is not possible to conclude that the
parties were ad idem.
Further I may note that as per the said alleged arbitration clause, the disputes
are to be settled by Delhi Hindustani Mercantile Association. The Association
claims to be registered presumably under the Societies Registration Act. It has to
act through authorised persons for the purpose of conducting arbitration. There
is nothing to show the composition or status of this Association. There is nothing
to show how the arbitral tribunal will be constituted by the said Delhi
Hindustani Mercantile Association. There is no consensus indicated in the
arbitration clause of the composition of the arbitral tribunal.
In my opinion, apart from the fact that there is no consensus for Arbitation, the
clause itself is vague. It is not possible to accept the plea of the respondent that
the parties have agreed to refer the disputes to arbitration of the said Delhi Hindustani Mercantile Association. Hence, the findings of the learned Arbitrators in the impugned order are clearly erroneous and contrary to the settled legal position."
30.In case titled Priknit Retails Ltd. And Ors. Vs. Aneja Agencies, 2018 Latest Caselaw 1927 Del, Hon'ble High Court of Delhi held, as under:
"24. Although, petitioner No. 1 had accepted the delivery of the goods, it is difficult to accept that petitioner No. 1 had also agreed to the arbitration clause as set out in the invoice. As noticed above, the name, quantity, as well as the date of the bill, is blank and the said clause also does not bear the signatures of either parties. A plain reading of the said clause indicates that it also purports to be a receipt for delivery of the goods acknowledging that the goods supplied are in good order and condition. Thus, for the said acknowledgement to be effective, it was necessary for it to be communicated to the respondent. However, as a signed copy of the said receipt was not returned by petitioner No. 1 to the respondent, it is not possible to accept that the said receipt/arbitration CS Comm No.05/2022 page 10 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles agreement became effective. A purported receipt of goods, which is neither signed nor communicated by the recipient, cannot be considered as a receipt.
26. Section 7(4) of the Act makes it explicity clear that an arbitration agreement would be in writing, if it is contained in a document signed by the parties; or contained in exchange of letters, telex, telegrams or other means of telecommunications, which provides a record of the agreement; or in an exchange of Statements of Claim and Defence in which the existence of the agreement is alleged and not denied. The arbitration clause is not signed by any party. It is also not possible to accept that the said agreement was embodied in exchange of letters, telex, telegrams or other means of telecommunication. However, it is necessary that such an agreement between the parties is discernible without any ambiguity.
27. Mere fact, that the delivery of goods had been accepted, would not imply that petitioner No. 1 had also agreed to the arbitration clause. As stated above, the said agreement is inchoate inasmuch as the blanks were never filled in. Further, the agreement remained unsigned. The contention, that petitioner No. 1 had not disputed the invoices would necessarily mean that petitioner No. 1 had also agreed to the arbitration agreement, is unmerited.
28. It is well settled that the arbitration agreement is a separate and an independent agreement, although it may be embodied in as a clause in the main agreement. In the present case, the respondent seems to have acknowledged this distinction and, therefore, had provided a separate receipt at the bottom of the invoice."
31.In case titled M/s Hetampuria Tax Fab Vs. M/s Daksh Enterprises, 2022/DHC/004962, Hon'ble High Court of Delhi held, as under:
"10. The appellant claims that since the respondent had signed the Delivery Challan, he had also accepted the arbitration clause. This contention is unmerited. A plain view of the Delivery Challan indicates that the signature has been appended below the statement to the effect that the goods have been received in good condition. It is apparent that the signatures relate to the said certification. It is well settled that a unilateral document issued by a party cannot, absent anything more, be construed as a binding arbitration agreement.
12. Sub-section (3) of Section 7 of the A&C Act expressly provides that an arbitration agreement shall be in writing. According to the appellant, the said condition is satisfied as the arbitration clause is set out in the Delivery Challan. There is no dispute that the clause has been set out in writing. However, this Court is unable to accept that the same was agreed to by the respondent. In order to constitute an agreement, there must be a consensus between the parties. This Court is unable to accept that the arbitration agreement had come into existence by the appellant unilaterally issuing a Delivery Challan and the respondent accepting delivery of the goods. As noted above, the respondent had accepted the goods and had signed the Delivery Challan indicating such acceptance. However, the same cannot be construed as appending the signatures to the arbitration agreement or agreeing to the arbitration clause as set out in the Delivery Challan.
17. However, in the facts of the present case, there is no material apart from a printed clause in the Delivery Challan indicating that any dispute would be referred to arbitration. As stated above, this Court is unable to accept that the respondent had agreed to the said stipulation by accepting the delivery of CS Comm No.05/2022 page 11 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles goods."
32.In the light of the above, this issue is answered in favour of plaintiff and against the defendant.
Issue no. 2:
2. Whether the plaintiff is entitled for decree of recovery of Rs.15,57,406/- against the defendant, as prayed for? (OPP)
33.At the onset it would be apprporpaite to cull out the facts admitted by both the parties as per pleadings, documents filed and proved and the evidence led. It is admitted that plaintiff, a private ltd. Company, is a wholesaler of women's clothings like saree, lehangas, designer suits etc., at Chandni Chowk and defendant, as proprietor of M/s Taruna Textiles, had business relations with the plaintiff since January 2017. It is also admitted that during the course of business oral orders were placed by the defendant and goods were sold by the plaintiff through GST paid invoices, post promulgation of CGST Act, 2017. It is also admitted that plaintiff was maintaining a running account ledger and defendant used to pay in lumpsum and not bill wise. It is not disputed that plaintiff made a sale of Rs.23,67,125/- as reflected in the ledger Ex.PW1/6 correctly during the period 21.01.2017 to 21.02.2017. It is also not disputed that during that period defendant paid Rs. 5 lakhs leaving a debit balance of Rs.18,67,125/-.
34.It is also not disputed that sale and purchase transactions between the plaintiff and defendant continued even after 21.02.2017. It is also not disputed by the defendant in the defence that all the credit entries made by the plaintiff company in its ledger are correct since it is not the case of the defendant that they made any payment to the plaintiff over and above the credit entries already available in the ledger Ex.PW1/6. It is further CS Comm No.05/2022 page 12 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles admitted case of the parties that the payment of Rs.50,000/- which was made on 24.11.2020 by way of cheque was the last payment made by the defendant to the plaintiff.
35.While opening her submissions, Ld. Counsel for plaintiff submits that plaintiff company there was a ledger balance of Rs.15,57,406/- on the basis of goods sold and supplied through GST paid invoices which was not cleared by the defendant and hence plaintiff was constrained to file this suit. It is submitted that this is the actual ledger balance as it existed on 24.11.2020 when the defendant admittedly made part payment of Rs.50,000/-. However, even though the suit in hand was filed on 03.01.2022 i.e. after around more than one year but still no pre-suit interest has been sought in the suit. This suit amount of Rs.15.57 lakhs is covered in 18 invoices issued between 11.04.2018 and 23.08.2018.
36.Persual of these 18 invoices which have been collectively exhibited on record as Ex.PW1/5 (colly.) shows that they are digital printouts purportedly taken from some invoicing software. None of these invoices is supported with affidavit under Order 11 Rule 6 CPC as mandated for Commercial Courts. For ready reference the same is reproduced as under:
Order 11 Rule 6 CPC: Electronic records.-
(1) In case of disclosures and inspection of Electronic Records (as defined in the Information Technology Act, 2000), furnishing of printouts shall be sufficient compliance of the above provisions.
(2) At the discretion of the parties or where required (when parties wish to rely on audio or video content), copies of electronic records may be furnished in electronic form either in addition to or in lieu of printouts.
(3) Where Electronic Records form part of documents disclosed, the declaration on oath to be filed by a party shall specify-
(a) the parties to such Electronic Record;
(b) the manner in which such electronic record was produced and by whom;
(c) the dates and time of preparation or storage or issuance or receipt of each such electronic record;
(d) the source of such electronic record and date and time when the electronic record was printed;
(e) in case of email ids, details of ownership, custody and access to such email ids;
CS Comm No.05/2022 page 13 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles
(f) in case of documents stored on a computer or computer resource (including on external servers or cloud), details of ownership, custody and access to such data on the computer or computer resource;
(g) deponents knowledge of contents and correctness of contents;
(h) whether the computer or computer resource used for preparing or receiving or storing such document or data was functioning properly or in case of malfunction that such malfunction did not affect the contents of the document stored;
(i) that the printout or copy furnished was taken from the original computer or computer resource.
(4) The parties relying on printouts or copy in electronic form, of any electronic records, shall not be required to give inspection of electronic records, provided a declaration is made by such party that each such copy, which has been produced, has been made from the original electronic record.
(5) The Court may give directions for admissibility of Electronic Records at any stage of the proceedings.
(6) Any party may seek directions from the Court and the Court may of its motion issue directions for submission of further proof of any electronic record including meta data or logs before admission of such electronic record.
37.Not even a certificate under Section 65B Evidence Act is placed on record qua these invoices.
38. During the course of trial, with permission of the Court plaintiff company had placed on record an additional set of invoices which were photocopies of invoices containing endorsements of receipt of goods. However, those invoices are only up to date 15.03.2018 and none of the 18 invoices issued between 11.04.2018 to 23.08.2018 is available therein. In a case like the one in hand, the primary onus of proving the sale of goods and actual delivery of the material rests on the plaintiff and the onus has to be discharged by way of cogent and legally admissible evidence. The only exception to Section 104 of Bhartiya Sakshya Adhiniyam, 2023 (Section 101 of Evidence Act) is that where defendant admits sale and receipt of such goods.
Section 104 of Bhartiya Sakshya Adhiniyam, 2023 (Section 101 of In- dian Evidence Act): Burden of Proof Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist.
CS Comm No.05/2022 page 14 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person.
Illustrations:
(a) A desires a Court to give judgment that B shall be punished for a crime which A says B has committed.
A must prove that B has committed the crime.
(b) A desires a Court to give judgment that he is entitled to certain land in the possession of B, by reason of facts which he asserts, and which B denies, to be true.
A must prove the existence of those facts.
39. In case titled Rangammal Vs. Kuppuswami and Anr., 2011 Latest Caselaw 417 SC dated 13.05.2011 Hon'ble Supreme Court held as under:
Section 101 of the Evidence Act, 1872 defines "burden of proof" which clearly lays down that:
"101. Burden of proof.--Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist.
When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person."
Thus, the Evidence Act has clearly laid down that the burden of proving a fact always lies upon the person who asserts it. Until such burden is discharged, the other party is not required to be called upon to prove his case. The court has to examine as to whether the person upon whom the burden lies has been able to discharge his burden. Until he arrives at such conclusion, he cannot proceed on the basis of weakness of the other party.
40.The relevant statute which governs sale of movable articles is Section 23 (2), 31, 33 and 39 of Sale of Goods Act, 1930. As far as duty of the seller is concerned under Sale of Goods Act (SoGA), 1930 Section 31 of the Act places entire duty on the seller to ensure that the goods sold are delivered to the buyer. For ready reference the same is reproduced hereunder:
Section 31: Duties of Seller and Buyer "It is the duty of 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."
41.The term delivery also stands defined under the Statute under Section 33 of Sale of Goods Act, 1930 . The same is reproduced hereunder:
CS Comm No.05/2022 page 15 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles Section 33: Delivery "Delivery of goods sold may be made by doing anything which the parties agree shall be treated as delivery or which has the effect of putting the goods in the possession of the buyer or of any person authorised to hold them on his behalf."
42.Likewise, standalone invoices do not prove delivery of the goods as mandated under Section 31, 33 and 39 of Sale of Goods Act unless there is a physical endorsement of delivery over them or there is a separate document so as to show that the goods were actually delivered to defendant or at least delivered to a goods carrier as provided under Section 23 (2) and Section 39 of Sale of Goods Act. For ready reference the same are reproduced hereunder:
Section 23 (2) :Delivery to carrier.--
"(2) Where, in pursuance of the contract, the seller delivers the goods to the buyer or to a carrier or other bailee (whether named by the buyer or not) for the purpose of transmission to the buyer, and does not reserve the right of disposal, he is deemed to have unconditionally appropriated the goods to the contract."
Section 39: Delivery to carrier of wharfinger:
"(1) Where, in pursuance of a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer, or delivery of the goods to a wharfinger for safe custody, is prima facie, deemed to be a delivery of the goods to the buyer.
(2) Unless otherwise authorised by the buyer, the seller shall make such contract with the carrier or wharfinger on behalf of the buyer as may be reasonable having regard to the nature of the goods and the other circumstances of the case. If the seller omits so to do, and the goods are lost or damaged in course of transit or whilst in the custody of the wharfinger, the buyer may decline to treat the delivery to the carrier or wharfinger, as a delivery to himself, or may hold the seller responsible in damages. (3) Unless otherwise agreed, where goods are sent by the seller to the buyer by a route involving sea transit, in circumstances in which it is usual to insure, the seller shall give such notice to the buyer as may enable him to insure them during their sea transit and if the seller fails so to do, the goods shall be deemed to be at his risk during such sea transit."
43.In this backdrop the onus of proving the delivery of the goods worth Rs.15.57 lakhs is on the plaintiff and under the law plaintiff could have proved delivery by any of the following methods:-
CS Comm No.05/2022 page 16 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles i. Admission by defendant/defendant acknowledges the delivery ii. Endorsement of receipt by the defendant on the 18 invoices.
iii. Filing and proving Form 7 or Form 8 (Bilty) under Carriage by Road Rules, 2011 to show that plaintiff delivered the goods to the carrier and is entitled to benefit under Section 39 of Sale of Goods Act, 1930.
iv. By proving on record that the GST claimed to have been deposited by the plaintiff qua these 18 invoices, defendant took input tax credit under Section 2 (63) of CGST Act, 2017 and plaintiff is entitled to presumption under Section 16 (2) of CGST Act, 2017.
44.Coming back to the case in hand a bare look at the above 18 invoices shows that there is no endorsement of receipt. PW1 and PW3 in their cross-examination shows that no goods were delivered without due endorsement. There is a reference of some consignments being sent to third party through courier but again admittedly no such goods receipt/bilty as per Form 7 of Carriage by Road Rules, 2011 promulgated under Carriage by Road Act, 2007 have been filed or proved on record.
45.In the absence of any evidence of sale of goods under these 18 invoices the bald submissions by Ld. Counsel for plaintiff that defendant has admitted business relations and has also admitted receipt of goods prior to issuance of these 18 invoices is of no avail. As discussed supra in order to seek a decree on the basis of sale and delivery of the goods, each and every single invoice has to undergo scrutiny under the above applicable laws. I also find no strength in the plea that failure of the defendant to place on record bare ledger and their failure to prove that these 18 invoices are forged should be treated as sufficient proof of delivery of the goods worth Rs.15.57 lakhs by the plaintiff to the defendant by applying CS Comm No.05/2022 page 17 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles Doctorine of Preponderance of Probability. By no stretch of argument or reasoning failiure of defendant to prove his defence can be considered as discharge of onus of proving the facts denied by the defendant. The plaintiff company has not been able to discharge the onus placed on it under Sale of Goods Act, 1930. This issue is answered against the plaintiff and in favour of the defendant.
Issue No. 33. Whether plaintiff is entitled for interest. If yes, at what rate and for which period? (OPP)
46.In view of the decision of above issues, no relief qua interest is made out.
Relief
47.In view of the above discussion, this Court has no hesitation in concluding that plaintiff has miserably failed to discharge the onus of proving this case and suit of the plaintiff is accordingly dismissed. Parties to bear their own costs.
48.Decree Sheet be prepared accordingly. File be consigned to Record Room after due compliance.
Digitally signed by SURINDER SURINDER S RATHI S RATHI Date:
2025.04.23 16:22:43 +0530 (SURINDER S. RATHI) District Judge, Commercial Court -11 Central District, THC Delhi/21.04.2025 CS Comm No.05/2022 page 18 Sanjeela Fashions Pvt. Ltd. Vs. Taruna Bansal, Prop M/s Taruna Textiles