Delhi District Court
M/S Radiant Hall Marking Pvt. Ltd vs Lasit Lighting Marking on 21 December, 2018
IN THE COURT OF MR. SUNIL BENIWAL ,
ADDITIONAL DISTRICT JUDGE -02, ( CENTRAL), DELHI
Case No.619692/16
M/s Radiant Hall Marking Pvt. Ltd.
2716, Second Floor
Bank Street, Karol Bagh
New Delhi-110005 ...........Plaintiff
Versus
1 Lasit Lighting Marking
Via R. BOSCO, 166
80069 Vico Equense (NA)-Italy
2 Quantum Equipment Co. Ltd.
301, Rajshree Plaza, LBS Marg
Ghatopar (W), Mumbai-400086, India
Also At:
A-503, Bldg. No.2, Kailash Industrial
Complex
Parksite, Vikhroli (W), Mumbai-400079
+ 91-22-25186631/32/33
And also at:
302/2214, Chanana Complex
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Hardhian Singh Road, Karol Bagh
Delhi-110005 .........Defendants
Date of Institution of Suit : 13.05.2011
Date of pronouncement of judgment : 21.12.2018
SUIT FOR RECOVERY OF RS. 40,15,871/-
Vide this judgment, I shall decide the suit of the plaintiff for
recovery and damages of Rs.40,15,871/-. Plaintiff is M/s Radiant Hall
Marking Pvt. Ltd. There are two defendants. Defendant no.1 is Lasit
Lighting Marking. Defendant no.2 is Quantum Equipment Co. Ltd.. Facts
stated in the plaint are as follows:-
1 Plaintiff is a company incorporated under the Companies Act
having registered office at 2716, 2nd floor, Bank Street, Karol Bagh, New
Delhi-110005 and is in the business of hallmarking of gold jewelry. Mr.
Satyender Kumar Gupta, Director of plaintiff company is constituted
attorney and authorized and competent to sign, verify the plaint,
vakalatnama etc. and also to institute the present suit on behalf of the
plaintiff company.
2 Defendant no.1 is manufacturer of Laser Jewel marking
machine in the name and style of Fly Air who claimed itself to be one of
the best manufacturers of jewel marking machine with superior quality
and the ultimate solution for precision marking of all types of metals.
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Defendant no.1 further represents that its machine has been designed for
easy integration into the industrial production line having a perfect
combination of lesser operational cost and thorough output. Defendant
no.1 also claimed that its machine is trouble free and does not require any
maintenance. Defendant no.2 is the only authorized agent of defendant
no.1 in India who markets the machine manufactured by defendant no.1
and are also responsible for after sales service. Plaintiff is in the business
of hall marking of the jewelry and they were in need of machine. They
acted on the representation made by the defendant and believing on the
representation by the defendants to be true, contacted the defendants for
purchase of the laser hallmarking machine. Plaintiff transferred a sum of
Euro 21,000/- to defendant no.1 towards the cost of machine. Machine
was delivered by defendant no.1 on 11.09.2008. At the time of purchase
of machine, defendant no.1 informed the plaintiff that it has to contact
defendant no.2 for after sales service. After a few months, the machine
started creating problems and plaintiff contacted defendant no.2 for
rectification. Defendant no. 2 sent their service engineer but the
machine again started creating problems and the same became a
regular feature because of which plaintiff suffered huge financial loss.
In the month of September 2010, the machine stopped working.
Plaintiff immediately contacted defendant no.2. Service engineer of
defendant no.2 visited the plaintiff premises and inspected the machine.
Managing Director Mr. D.M Musale of defendant no.2 informed the
plaintiff that there is some problem in the Diode of the machine and he
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suggested for replacement of the same. Average life of diode explained by
the defendants is 10,000 hours. But in the case of plaintiff, defendants
recommended the replacement only after the use of 1523.70 hours only.
Plaintiff was further informed by defendants that diode is a consumable
item and therefore, the plaintiff has to pay Rs.3,00,868/- for the same.
Having no other option as they wanted to utilize the machine, plaintiff
agreed for the same and transferred an amount of Rs.3,00,868/- through
RTGS on 27.09.2010 which was also confirmed by defendant no.2.
3 Despite receipt of cost of diode on 27.09.2010, plaintiff
received the diode on 04.10.2010 i.e. after one week from date of payment
but to the shock and surprise of the plaintiff after several trials for
installation of the new diode and also changing other relevant parts of
machine by service engineer of defendant no.2, laser machine could
not be made operational. Defendant no.2 asked the plaintiff to send the
machine at their head office at Mumbai after assurance that the machine
shall be put in order. On 08.10.2010, entire laser marking machine was
packed and couriered by DTDC through proof of delivery no. D03991806.
Despite the fact that the machine had reached Mumbai, defendant no.2
neglected to take delivery of the same and when the plaintiff contacted
defendant no.2, they were misinformed that the machine is already under
repair. However, plaintiff received a call from DTDC that nobody had
picked up the machine. Plaintiff immediately contacted defendant no.2
and then the consignment of machine was collected only on 16.10.2010.
On 19.10.2010, defendant no.2 after carrying out the repair,
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dispatched the machine to Delhi and plaintiff was informed by engineer
of defendant no.2 i.e. Mr. Ram that he himself had tested the machine and
it was functioning properly after necessary repairs being carried out.
4 On 20.10.2010 plaintiff received the machine but at the time
of installation, the plaintiff noticed that the machine was not repaired
properly and there were several new problems which were not present
before when the machine was sent for repairs. Dissatisfaction of the
plaintiff with the installation was evident in the customer service
report dated 20.10.2010 which was prepared by engineers of
defendant no.2. As per laser machine brochure supplied by the
defendants, it is claimed that average life of diode is 10,000/- hrs. but in
the case of plaintiff the same had to be changed after 1523.73 hrs. only.
When this was pointed out to the defendants, the plaintiffs were informed
that the reading on the diode is 1523.73. Through e-mail dated
20.10.2010, plaintiff requested the defendant for proper explanation but
the same has not been provided till date. The diode which was replaced
earlier was not working and the Lan Cord was also missing.
Defendants were notified that the machine stopped working within a
day's time and plaintiff was put to a great amount of inconvenience as
well as financial loss. Plaintiff immediately informed the same to
defendant no.2 but was told that the problems were in the PC server
and the same would incur a further expenditure of 3 to 5 lacs for
repairs. Plaintiff was taken aback by this shock to discover that initially
the said component did not bear any fault. Now it is clear that defendant
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no.2 had always misguided the plaintiff and mishandled the machine in
order to have unlawful gain by illegal means which is not expected from a
company of international repute.
5 On 23.10.2010, plaintiff conveyed their displeasure to
defendant no.2 and requested them to rectify the defect in two days. On
25.10.2010, plaintiff again requested defendant no.2 to do the needful but
they failed to respond. On 28.10.2010 after several requests and
reminders, the service engineers from defendant no.2 visited the
premises with a new PC server stating that after the replacement of
PC server, the machine will start functioning normally. But despite
numerous hit and trials coupled with several experiments on the
machine of plaintiff and also after replacement of PC server, the
machine failed to function. Thereafter, the service engineer of defendant
no.2 informed the plaintiff that CPU of computer belonging to plaintiff
suffers from defaults. The plaintiff immediately replaced the CPU but all
in vain. However, the service engineers of defendant no.2 somehow
managed to start the machine despite the fact that the software installation
and the necessary settings could not be completed. Replacement of PC
server did not make any difference in the state of the machine. Now, it
is clear that first of all replacement of PC server was not required and the
same was done only to extort more money from the plaintiff. On
29.10.2010 in the morning, service engineers of defendant no.2 again
visited the premises of plaintiff and tried to resolve the software issue.
Plaintiff asked them to test the marking of the machine which worked in
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the presence of plaintiff but to the surprise of plaintiff the machine
stopped working immediately thereafter.
6 It is important to mention that since 29.10.2010 plaintiff has
exchanged several communications with both the defendants but they
have failed to deliver any desirable results. On 03.11.2010, plaintiff again
requested both the defendants to rectify the defects and also to provide a
new code. After several complaints and requests, defendants suggested to
the plaintiff that the machine requires replacement of power supply and
the PC server. Plaintiff was left with no other option but to believe them.
On 04.11.2010, service engineers of defendant no.2 visited the plaintiff
and replaced the power supply. After replacement of that, the machine
started to function but the important issue of dim/light marking remained
unresolved for which the defendant had initially changed the Diode after
charging sum of Rs.3,00,868/-. This fact is mentioned in service report
dated 04.11.2010 issued by defendant no2. On 07.11.2010 and 08.11.2010
plaintiff again requested both the defendants to refund the cost of the
machine. The defendant replied and tried to put all blame on the plaintiff.
Defendant further offered a new advanced fly air laser system against old
unit at a special price of 12,000 Euro plus shipment. Defendants further
agreed to reduce 3000 Euros on account of diode which was replaced by
them, therefore, the effective price for new laser being 9000 Euro.
Plaintiff immediately replied and asked defendant no.2, the basis of
deduction of only 3000 Euro towards the cost of diode whereas infact they
had charged rs.3,00,868/-. Instead of resolving the issue, defendant raised
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false and frivolous pleas in order the justify their illegal demands and
deficient service.
7 On 11.11.2010, defendant no.2 in a mail to defendant no.1
admitted that there is a defect in machine but failed to rectify the
same. On 16.11.2010 plaintiff again requested both the defendants to
resolve the issue but surprisingly and in utter disregard to their
commitment they tried to put all blame on the plaintiff. It was impossible
for the plaintiff to believe that despite having investing a sum of 21000
Euro and thereafter plaintiff being suffering from financial losses, plaintiff
shall not co-operate with the engineers of the defendants. On 30.11.2010,
defendant no.2 admitted that despite the replacement of Diode module, the
marking problem was not rectified and defendant no.2 requested
defendant no.1 to take appropriate steps to resolve the problem. On
06.12.2010 plaintiff again brought to the attention of the defendants the
problem faced by them but to no avail. Despite the payment of
Rs.3,00,868/- for replacement of diode as far back as 26.09.2010,
defendants failed to rectify the defects till date. Defendants inability to
rectify the defect has caused substantial loss to the plaintiff. Plaintiff time
and again requested the defendants to repair the machine and has not
shown any intention to purchase a new machine in place of the previous
machine. It has been the plaintiff's persistent stand that the old machine
should be repaired and in the meantime the plaintiff should be provided
with an alternative machine so that work of plaintiff does not suffer. The
conduct of the defendants does not only amount to unfair practice but also
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constitutes deficiency in service. Defendant no.1 and 2 are hands in gloves
with each other and their only motive is to cheat the plaintiff by making
false promises. On 10.12.2010, plaintiff issued a legal notice to the
defendants calling upon them to replace the machine with a new one
or to refund the entire cost of the machine within a week of the receipt
of the notice. Despite receipt of the notice, defendants failed to comply
and do the needful. Defendant no.2 issued a reply raising false and
frivolous pleas.
8 On 11.01.2011 plaintiff issued rejoinder notice to defendant
no.2 requesting them to replace the machine, however, despite receipt,
defendant failed to take appropriate steps. Since defendants have failed to
replace the machine, they are liable to refund Rs. 14,40,000/- after
making deduction on account of depreciation for two years @ 10% on
purchase price of Rs.18 lacs. Plaintiff is also entitled for an amount of
Rs.3,00,868/- as same was charged by the defendants for replacement
of part of the machinery. Plaintiff is incurring loss of business of Rs.1.5
lacs per month from September 2010 onwards and therefore, plaintiff
is entitled to an amount of Rs.7.5 lacs till the date of filing of the suit.
Plaintiff sustained grievous mental harassment due to the acts and
conduct of the defendants, therefore, entitled for further amount of Rs.4
lacs on account of mental harassment. Plaintiff has also incurred
miscellaneous expenses including legal expenses, hence, plaintiff is
entitled to an amount of Rs.50,000/-. Therefore, when all the above
sums are computed, plaintiff is entitled to total amount of
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Rs.29,40,868/- from the defendants. Defendants are liable to pay jointly
and severally the abovementioned amount and are further liable to pay
interest @ 18% per annum from the date of purchase of machine i.e.
23.06.2008 till 31.01.2011 on an amount of Rs.21,90,868/- which comes
to Rs.10,18,753/-. Defendants are also liable to pay interest @ 18% per
annum from September 2010 to January 2011 for loss of business @
Rs.1,50,000/- on amount of Rs.7,50,000/- i.e. Rs.56,250/-. Therefore, in
total, defendants are liable to pay Rs.40,15,871/-. Court fees has been
paid at the value of Rs.40,15,871/- alongwith advalorem Court fees of
Rs.39,500/-. It is therefore prayed that this Court be pleased to pass;
1) a decree of Rs.29,40,868/- in favour of plaintiff and against the
defendants;
2) award interest @ 18% per annum from the date of purchase of
machine i.e. 23.06.2008 till January 2011 on an amount of Rs.21,90,868/-
and also award interest @ 18% per annum from September 2010 to
January 2011 on amount of Rs.7,50,000/- in favour of the plaintiff and
against the defendants;
3) award pendentelite and future interest @ 18% per annum on the
abovestated amount till the realization;
4) award the costs of this suit in favour of the plaintiff and against the
defendants;
5) pass such other order as Court may deem fit and proper.
9 Defendant no.1 was served. But as per order dated
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14/10/2015, no WS was filed on behalf of defendant number 1 and their
right to file WS was closed. Defendant no 1. did not contest this case and
written statement was filed on behalf of defendant no.2 only. Facts stated
in the written statement are as follows:-
10 It is submitted that defendant no.2 is not liable for the quality
of products since the products are not manufactured by it. It is denied
that the machine purchased by the plaintiff started creating problems.
It is denied that there was any problem with the machine or that it was a
regular feature or that the plaintiff has suffered huge financial loss.
Defendant no.2 continued to maintain the machine free of charge in
September 2010. Maintenance was a regular feature and the defendant
never received any complaint of the machine in functioning as alleged by
the plaintiff. Defendant no.2 continued to maintain the machine even
after warranty expired which was for 12 months from the date of
supply. There were payments of Rs.3 lacs that the answering
defendant had to incur towards customs duty and related charges for
clearing that machine when it was imported to India. It was liability
of the plaintiff to reimburse the defendant which was never paid by
the plaintiff. Plaintiff contacted defendant no.2 in September 2010
regarding the problem in the machine and when its service engineer
visited the plaintiff, it was found that diode was faulty and it was
suggested that the diode be replaced. Since diode was not under
warranty, defendant no.2 requested the plaintiff to release the
payment in advance. The payment in advance was requested partially
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because of the reason that even prior to this, the prior payment of
Rs.3 lacs which the plaintiff was supposed to pay for the customs duty
and related charges was not paid by the plaintiff. The figure of 1523.70
hours of use of diode as per the reading of the machine is not correct.
There are several possible reasons for damages of laser diode which
include humidity, improper handling, electrical surges etc. the laser diode
module is a part of laser marker system which is consumed upon several
markings. The average life of diode is around 6000 hours but it is possible
that diode may get damaged due to other several reasons like mishandling,
over voltage, improper earthing, high humidity resulting in arcing, use of
diode without proper cooling etc.
11 Diode being a mechanical instrument, there can be several
problems related to it. It was found that after replacement, the diode unit,
though started functioning but was not functioning satisfactorily as alleged
by the plaintiff. Technician of defendant no.2 made several attempts to
make it operational but finally requested that the machine be sent to its
Mumbai Head office for service. It is denied that defendant no.2 neglected
to take the machine in Mumbai or misinformed the plaintiff about its
repair. Machine was received by defendant no.2 at the Mumbai office in
unpacked condition and was repaired by the technician without need of
any additional part. Issue only related to optimization of new laser diode.
The performance of machine was demonstrated to the concerned person of
plaintiff in Mumbai who had collected the unit himself upon verification
of the same and then took it to Delhi. Mr. Ram Krishna Nirdhar from
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defendant's Mumbai Office and Mr. Amit Gupta from Delhi office visited
the workshop for verification of unit. Plaintiff did not sign the service
report during their visit. It is denied that the machine was not repaired
properly. It is denied that there were several new problems which were not
present before machine was sent for repairs. Machine was installed by
technician of defendant no.2 from Delhi and it was handed over to the
operator of the plaintiff for routine work. Its performance was acceptable.
Routine work started on regular basis. Submissions of the plaintiff to the
contrary are incorrect. The new diode has working hours of 58.78 hours
because of the running tests carried out at Mumbai before its delivery to
the plaintiff. When the unit was tested with new diode, it started
working properly. However, because of improper communication, a
new LAN cable for interface was also requested for. Defendant also
got replaced the Resonator from their own stock to verify if there was
any other issue. This has also been mentioned in the service report. The
diode has a reading meter and basic reading of about 50 hours which is
always possible for a new diode because of initial production and stability
tests. The figure of 1532.7 hours is incorrect. Instead it is 15327 hours. It
is denied that the Diode was not working or that LAN code was missing.
It is denied that the machine after its repair stopped working within a day's
time. No inconvenience or financial loss has been shown in the present
plaint.
12 It is denied that defendant no.2 has misguided the plaintiff or
mishandled the machine in order to have unlawful gains by illegal means.
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Defendant no.2 tried its best to repair the machine. Technician sent by
defendant no.2 suffered a great deal because they were severely harassed
by the plaintiff on their visits. It was for this very reason that technicians
were actually hesitant to visit the plaintiff because of torturing and
detaining tactics adopted by the plaintiff. Infact, a new power supply
module of the defendant worth Rs.1.75 lacs which was used to check and
repair the machine was detained by the plaintiff and has not been returned
till date. Due to connectivity problems it is always difficult to diagnose the
unit and several trials and error methods are required with certain change
and components for proper rectification. Defendant changed several parts
from their end including PC server, resonator, power supply etc. but never
claimed any money for the same and took the money only for diode
module which had certain life and is termed as "consumable". So far as
regards the allegations regarding service and manhandling of the machine
or to suggest the replacement of unit for extraction of money is concerned,
it is submitted that the same are wrong and denied. This being a technical
and mechanical job, certain trials and errors are required to repair the
machine. Defendant no.2 never demanded any money from the plaintiff
till the service of the unit was complete. In any event, the payment would
have been made only when the machine was rectified properly. Technician
was doing his best to repair the machine and that is why several trials were
required for the same. In so far as starting of the machine without a
necessary software installation is concerned, it is submitted that this was
not correct and not final because the technician was still doing his job and
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therefore, to claim that there was no requirement of replacement of PC
server etc, is totally incorrect, wrong and denied.
13 Plaintiff has mentioned only incomplete and half truths so as
to suit themselves. So far as the new code is concerned, laser software has
a protection code and in case of change in any parameter or PC, a new
code is required which is to be provided by Italian manufacturer i.e.
defendant no.1. Plaintiff has conveniently omitted to state that the code
was finally taken and provided because of which the software started
functioning. Based on a series of diagnosis and communications to the
Italian manufacturer, technician of defendant no.2 advised the plaintiff to
check the unit by replacing the server and power supply module which
was provided by defendant no.2 from their own stocks. Though, the
machine started functioning, plaintiff was still not satisfied for the reasons
best known to them. Behavior of plaintiff was extremely arrogant towards
the technician. Technicians were not allowed to complete the required
trials to diagnose the faults because of the hostile behavior of the plaintiff.
After completing the tests, power supply module of the defendant was
not given back. It is submitted that power supply module costs about
Rs.1.75 lacs. The payment of approximately Rs.3 lacs for customs
clearance etc. was also not cleared by the plaintiffs by the plaintiff till
date. So far as regards the price of diode and machine etc. is concerned,
defendant no.2 had requested the plaintiff to exchange the unit with a new
technology to avoid any delay in service issue. Defendant no.2 is not the
supplier or manufacturer but is only an agent of defendant no.1. It is
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submitted that the Euros cannot be simply multiplied or converted
into Indian rupees but the customs duty, bank charges, shipment
charges and clearance expenses are also required to be calculated to
determine the actual amount or the concession given. It is submitted
that the new laser diode was under warranty and could have been replaced
easily by the Italian manufacturer but the plaintiff did not allow defendant
no.2 to do any trial or error and was not even ready to send the machine at
the premises of the defendants for detailed diagnosis. In fact, the plaintiff
continued to use the machine for its routine application and therefore it
cannot be said that he has suffered any loss or damage. It is submitted
that an alternative machine could have been provided to a normal
consumer. However, in the present case, the plaintiff's extra ordinary
hostile and arrogant behavior towards the technician including
detaining the units and equipment of the defendant when they sent
their technicians for repair, resulted in the non-supply of units to the
plaintiff since there was serious apprehension about their future course of
action and also in view of the long overdue payment of the defendant
despite several requests. It is the plaintiff who has created problems for
the technician of defendant no.2 and has also hampered the services of
defendant no. 2 to be received in a proper manner. The defects could have
been rectified and the machine could also have been replaced, but it was
not done so because of the adamant behavior of the plaintiff. There is no
question of returning the old units since there was never such a condition
at the time of purchase. The machine was directly imported by plaintiff
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from defendant no. 1 and defendant no. 2 was nowhere in picture except
for assisting the plaintiff in clearance of the machine from customs.
Plaintiff has failed to produce any material in support of its alleged losses,
therefore, plaintiff is not entitled to any amount. It is submitted that
defendant no. 2 is entitled to its payment of Rs. 3 lacs which it had
incurred during custom clearance etc.
Replication:-
Para-wise replication:-
14 Defendant no. 2 is liable for the bad quality of the product
which has been supplied by defendant no. 2. Defendant no. 2 is also liable
for providing an effective and trust worthy after sales service which it has
failed to do. Defendant no. 2 is the only authorized agent in India who
markets the machine manufactured by defendant no.1. Defendant no.
2 is also responsible for the after sales service. Defendant no. 1 while
offering the impugned machine, lured by stating that they also have Indian
persons in the form of defendant no. 2. Defendant no. 2 is concocting a
false story as all the problems which have taken place have been well
documented in the form of e-mail communication and the reports which
have been made by the service engineers which visited the plaintiff on
behalf of defendant no. 2. The fact that the warranty of the product expired
does not mean that the after-sale services of the same shall not be
provided. After sale service was the sole responsibility of defendant no. 2
as the same was the selling point on the basis of which the machine was
purchased. Irrespective of the fact, whether or not the warranty expired,
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defendant no. 2 had a continuous duty to provide after sale service.
15 Plaintiff has not withheld any amount due to be paid by the
plaintiff to defendant no.2. A No objection certificate is required by the
plaintiff before they could clear octroi charges and when the same was
demanded from defendant no. 2, defendant no.2 simply refused to take the
pain of getting no objection certificate from the octroi department.
Defendant no. 2 never provided this no objection certificate and therefore
there is no liability on the part of plaintiff to pay this amount. Defendant
no. 2 himself admitted the laser diode to be faulty. There is no certain
figure given by defendant no.2 as to what was the reading of the laser
diode in September 2010 when the complaint was made by plaintiff. It is
again argued with conviction that average life of a laser diode is 10,000
hours and, in this case, laser diode worked for 1523.70 hours subsequent
to which it started malfunctioning and gave a very dim impression. The
laser diode provided with the new machine was faulty from the very
beginning and no cause of mishandling, over voltage, improper earthing,
high humidity etc. has been the reason behind the malfunctioning.
Defendant no.2 has absolutely no justification as to why a brand new laser
diode which has been especially ordered by the plaintiff after paying huge
money is not working smoothly. Technician who visited on behalf of
defendant no.2 could not work out a solution. None of the plaintiff's
representative was ever satisfied with the working of the machine. The
recurring problem inherent in the machine of a faulty laser diode has never
been resolved. The machine never performed as per its normal
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expectations and was faulty throughout the course of time. It is denied that
the machine started functioning properly when a new diode was replaced.
On the contrary, this is a major point of grievance that even after
replacement of new diode, the machine never functioned properly.
16 It is denied that the technicians of defendant no.2 were ever
harassed by the plaintiff. On the contrary, they were treated very warmly
and were offered tea along-with snacks on each and every occasion when
they visited plaintiffs. It is true that the plaintiff was never happy with the
fact that the technicians were not able to provide a solution to the existing
problem and rather plaintiff has been illegally duped. Plaintiff never
misbehaved with the representative of defendant no.2. The allegation of
defendant no.2 that plaintiff withheld power supply module worth
Rs.1.75 lacs is despicable and gruesome. Defendant no.2 is put to
strict proof of this allegation. The plaintiff reiterated its allegation qua the
defendant. The technicians and service engineers of defendant no.2 were
not able to treat the problem in an efficient manner due to which they
started feeling embarrassed. E-mail on 11.11.2010 written by defendant
no.2 to defendant no.1 conclusively proves that the fault was in laser
diode and it was only reason behind the entire problem. Defendant
no.2 has itself conceded that they would have provided a new machine to
a normal customer, but, because the plaintiff was behaving arrogantly,
they did not provide the same. It is for this Court to decide whether this
is a blatant admission on the part of defendant no.2 whether it has
clearly accepted that this case was a fit case for providing an
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alternative machine but the same was not provided because of flimsy
and vague allegations like hostile behavior and bad attitude. The
plaintiff always behaved with great respect and humility with service
engineers of defendant no.2 but even if assuming that the same was not
done even then defendant no.2 had no right not to provide a remedy or
relief which they were otherwise duty bound to provide. This fact is a
clear admission on the part of defendant no.2 and suit should be decreed
on this basis alone.
17 Plaintiff examined Mr. Satyender Kumar Gupta as PW1 and
tendered following documents in support of its case:-
S.No. Documents Exhibited
1 Board Resolution dated 18.02.2011 Ex.PW1/1
2 Minutes of meeting dated 14.04.2011 Ex.PW1/1A
3 Board resolution dated 19.02.2018 Ex.PW1/1B
4 Copy of certificate of incorporation of Ex.PW1/2
plaintiff company
5 Brochure and booklet of defendant's Ex.PW1/3 (colly)
products
6 Proof of payment made to defendant Mark A
no.1
7 Proforma invoice dated 17.09.2010 Ex.PW1/5
8 Proof of payment made to defendant Ex.PW1/6
no.2 for purchase of diode
9 Email dated 19.10.2010 Ex.PW1/7
10 Customer service report dated Ex.PW1/8
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20.10.2010
11 Email dated 23.10.2010 Ex.PW1/9
12 Email dated 25.10.2010 Ex.PW1/10
13 Customer service report dated Ex.PW1/11
28.10.2010
14 Customer service report dated Ex.PW1/12
29.10.2010
15 Email dated 03.11.2010 Ex.PW1/13
16 Customer service report dated Ex.PW1/14
04.11.2010
17 Email dated 07.11.2010 Ex.PW1/15
18 Email dated 08.11.2010 Ex.PW1/16
19 Email dated 11.11.2010 Ex.PW1/17
20 Email dated 17.11.2010 Ex.PW1/18
21 Email dated 30.11.2010 Ex.PW1/19
22 Legal notice dated 10.12.2010 Ex.PW1/20
23 Postal receipts and AD cards Ex.PW1/21 (colly)
24 Rejoinder notice dated 11.01.2011 Ex.PW1/22
25 Postal receipts Ex.PW1/23 (colly)
26 Affidavit u/s 65B of Indian Evidence Ex.PW1/24
Act
18 In his evidence affidavit, PW1 deposed on exactly the same
lines as that of his plaint and replication and no new material fact was
alleged or deposed in the evidence affidavit of PW1.
19 During his cross examination, PW1 deposed that he is in the
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 21 of 42
business of hallmarking since 2008 and this was the first laser marking
machine purchased by the plaintiff for its business. PW1 does not have
any prior experience in handling the laser marking machine.
Defendant no.2 approached the plaintiff for the sale of products of
defendant no.1 company. He was asked a specific question whether the
plaintiff had paid the balance of Rs.3 lacs for importing the laser marking
machine which Rs.3 lacs was paid by defendant no.2 from their own
account to which witness replied that as per his knowledge they
received a notice from some department in Mumbai with respect to
pending octroi charges. Witness then volunteered to depose that they
contacted defendant no.2 and requested them to get no objection
certificate from the department for the final payment to be made but the
same is still pending as no objection certificate was never obtained by
defendant no.2. Witness was asked a specific question whether they had
paid the amount mentioned in the octroi notice to defendant no.2 to get no
objection certificate to which witness replied that when they contacted
defendant no.2, they were told that the octroi charges have already been
taken care of and thereafter the plaintiffs requested for no objection
certificate for the same. Plaintiff did not receive any notice from any
department. Witness deposed that plaintiff first started operating the
machinery in September/October 2008. Witness deposed that they have
not used any other machine for the purpose of marking during the
period between September 2008 to September 2010. Witness does not
remember the exact number of services of the machine during the period
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 22 of 42
of September 2008 to September 2010. Business hours of the plaintiff
company were from 11 am to 7.30 pm during which they operated the
machine for about 2-3 hours. Witness was put a specific question whether
any official/agent of the plaintiff company was present at Mumbai when
the machine was being sent for replacement of diode to which witness
replied that his friend went to office of defendant no.2 in Mumbai to check
whether the delivery of the machine was taken by them or not. Witness
volunteered to depose that replacement of diode was done in Delhi and not
in Mumbai. Witness denied the fact that when the machine got tested in
Mumbai it was working without any defect in presence of person of the
plaintiff. Witness volunteered to depose that he was denying the
abovementioned fact because his friend who was present in the office of
defendant no.2 in Mumbai had no technical knowledge of the machine and
was there only to check whether any work was done on the machine or
not. Report dated 29.10.2010 was prepared in the presence of the witness.
Witness volunteered to depose that he has stated in his evidence affidavit
Ex.PW1/A that soon after the machine stopped working, the plaintiff sent
an email to defendant no.2 to inform the same. Plaintiff deposed that there
was no e-mail communication since 29.10.2010 when the report was
prepared till 03.11.2010 regarding any fault in the machine. Witness
deposed that they were not ready to get the machine replaced with a new
one on discounted price.
20 Witness was put a specific question whether he was
denying Ex.PW1/17. Whether the witness or the plaintiff was willing to
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 23 of 42
get a new machine for the old laser machine on buy back basis to which
witness replied that he was never willing to get the machine replaced but
was offered to get the machine replaced as they were never able to repair
their existing machine. Witness deposed that it is wrong to suggest that he
failed to maintain the machine properly during the period between
September 2008 to September 2010. It is wrong to suggest that on account
of improper maintenance, the machine failed to work satisfactorily after
September 2010. It is wrong to suggest that defendant no.2 provided best
service apart from any manufacturing defect in the machine. It is wrong to
suggest that at Mumbai the machine was working properly in the presence
of friend of plaintiff witness.
21 Thereafter, defendant examined Dr. Bharat Bhushan as
defence witness on behalf of defendant no.2. In his evidence affidavit, he
deposed that he was regional Manager of defendant no.2 company and
was well conversant with the facts and circumstances of the case. He
deposed that he was authorized and competent to swear this affidavit.
Copy of authorization letter dated 07.05.2012 authorizing him to act on
behalf of defendant no.2 is Ex.DW1/1. He deposed that defendant no.1 is
a manufacturer of laser jewel marking machine in the name and style of
Fly Air from whom the machine was purchased by plaintiff by making
direct payment to defendant no.1. Defendant no.2 was only an
authorized agent of defendant no.1 in India at the time of purchase of
the machine and is responsible only for service of the machine since the
products are manufactured by defendant no.1. Therefore, defendant
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 24 of 42
no.2 is not liable for the quality of the machine or the products. He
deposed that defendant no.2 continued to maintain the machine free of
charge in September 2010. Maintenance was a regular feature and
defendant no.2 never received any complaint of the machine not
functioning on a regular basis. Defendant no.2 continued to maintain the
machine even after expiry of warranty period which was of 12 months
from the date of supply. On the contrary, the payment of about Rs.3 lacs
which was made by defendant no.2 towards customs duty and related
charges for clearance of the machine for being imported in India was the
liability of the plaintiff which the plaintiff failed to reimburse to defendant
no.2. Plaintiff contacted defendant no.2 in September 2010 regarding the
problem with the machine and when the service Engineer of defendant
no.2 visited the plaintiff, it was found that the Diode was faulty and
replacement of Diode was suggested. Since the Diode was not in warranty,
defendant no.2 requested the plaintiff to release the payment in advance.
The request for release of advance payment was made partially because of
the reason that even the prior payment of Rs.3 lacs was not cleared by the
plaintiff.
22 The figure of 1523.70 hours of usage of Diode as per the
reading of the machine is not correct since there can be several possible
reasons for damage of the laser diode which includes humidity, improper
handling, electrical surges etc. A laser diode module is part of laser
marking system which is consumed upon several markings. Average life
of this Diode is around 6000 hours but it is also possible that the Diode
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 25 of 42
may get damaged due to several reasons like mishandling, improper
earthing, high humidity resulting in arcing, use of Diode without proper
cooling. Diode being a mechanical instrument, there can be various
problems related to its functioning. After the replacement of Diode,
though the unit started functioning but not satisfactorily as alleged by the
plaintiff. Technician of defendant no.2 made several attempts to make it
operational but finally requested that the machine be sent to Mumbai Head
Office for service. Defendant no.2 was not negligent in taking the machine
in Mumbai and never misinformed the plaintiff about the repair. Machine
was received by defendant no.2 at Mumbai Office in unpacked condition
and was repaired by the technician without need of any additional part.
The issue pertains only to the optimization of new laser diode.
Performance of the machine was demonstrated to the concerned person of
the plaintiff in Mumbai who collected the unit himself after verification
and brought it back to Delhi. Mr. Ramkrushna Nirdhar from defendant
no.2's office and Mr. Amit Gupta from Delhi office visited the workshop
of the plaintiff for verification of the unit. But the plaintiff did not sign his
report during their visit. Routine work of the machine started on a regular
basis. The new Diode had working of 58.78 hours because of the tests
carried out on it at Mumbai before it was supplied to the plaintiff. After
the unit was tested with the new Diode, it started working properly but
because of improper communication, a new LAN cable for interface was
also requested for. Defendant no.2 also got replaced the resonator from
their own stock to verify the same if there was any other issue which may
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 26 of 42
have been mentioned in his report. The Diode has a reading meter and a
basic level reading of about 50 hours is always possible for new diode
because of initial production and stability tests. Rest of the deposition of
defence witness of defendant no.2 is identical to the facts mentioned by
defendant no.2 in their written statement. Defendant is entitled to its
payment of Rs.3 lacs for custom clearance etc. from the plaintiff. Because
of the frequent quality issues and non-support of services, defendant no.2
has terminated the agreement with defendant no.1 in 2014. The present
address of defendant no.1 is Lasit Systems & Electronics Technologies
Spa, Via Solferino 4, 80058, Torre Annunziata, Naples (NA), Italy. Letter
of authorization on behalf of Dr. Bharat Bhushan to work on behalf of
defendant no.2 organization towards Court matters against the plaintiff for
the present case is Mark A.
23 During his cross examination, defence witness Mr. Bharat
Bhushan deposed that he was representing defendant no.1 in India for
installation and after sales service of the machine. Payment of the machine
was made directly to defendant no.1 and the plaintiff company directly
purchased and imported the machine from defendant no.1. Witness is
doctorate in Chemistry. Witness deposed that he does not have any prior
experience in repair or manufacturing of diode machine but he
volunteered to depose that his company has engineers who are very well
trained for repair of the machine. He was put a specific question whether
the authority letter dated 07.05.2012 Mark A filed by him authorized him
to give evidence on behalf of defendant no.2 to which witness replied in
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 27 of 42
affirmative. Witness deposed that the abovementioned suggestion given
by the cross-examining counsel was correct. Witness is not aware whether
he used to get any retainer ship from defendant no.1 company for the
services provided on their behalf. Witness could not recall whether the
plaintiff company was approached by him for the purchase of the
machine. Witness volunteered to depose that since they were in this field
since very long, it is possible that the plaintiff might have approached
defendant no.2 as defendant no.2 are famous in this field. In the sister
concern company of the plaintiff, the name of which the witness could not
remember, the sister company were already using Karat meter.
24 Ex.PW1/3 belongs to defendant no.1 company and not to
defendant no.2. It is correct that Ex.PW1/3 bears the name and stamp of
defendant no.2 at point A & B. Expected life of laser diode machine is
5000 to 6000 hours which can be damaged/tampered through electricity,
earthing and improper handling. Witness deposed that the reason
behind the Diode of the machine of the plaintiff not working properly
was that the working hours of the Diode had exceeded their maximum
limit. Witness volunteered to depose that they also found that the
plaintiff was using the machine without proper earthing. Witness does
not know whether they have placed on record any document to show that
the machine was being used without proper earthing. Witness has not
placed on record any document to show that they had suggested to the
plaintiff for earthing of the machine was not there. Witness deposed
that it is incorrect to suggest that the machine was facing problems even
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 28 of 42
after replacement of laser Diode. Witness volunteered to depose that at the
time of delivery of machine in Mumbai, after replacement of Diode,
functioning of laser was demonstrated to the authorized representative of
the plaintiff to the satisfaction of the authorized representative. Further,
the machine was installed at the Delhi site of the plaintiff. Mr. D.M
Musale is the Managing Director of defendant no.2. Witness cannot
recall whether even after dispatch of machine from Mumbai, the
machine had problems regarding which assurance was given by
defendant no.2 to resolve the same in time. Witness or defendant no.2
has not filed any suit with respect to the alleged pending payment of Rs.3
lacs. No document has been placed on record to show that the warranty
period was of 12 months.
25 Witness deposed that they charged fee for providing after
sales service after expiry of warranty period. Witness was put a specific
question as to why they provided after sale services to the plaintiff free of
cost in the present case to which witness replied that his office is also in
Karol Bagh, payment was pending and on the assurance of the plaintiff
that the payment will be released, they kept on providing services till the
time Diode issue was raised. Witness does not know whether they have
placed any document on record showing acknowledgment of the
plaintiff about satisfactory repair and servicing of the machine.
Witness has not filed any complaint regarding the alleged harassment
and torture of service engineers by the plaintiff. E-mails were
exchanged in between the witness of the plaintiff between Mr. Musale
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 29 of 42
and the plaintiff. Witness deposed that it was incorrect that they were
conducting various trials and errors because they were unable to resolve
the problem in the machine. Witness has not filed any suit against the
plaintiff for recovery of power supply module worth 1.75 lacs. Witness
volunteered to depose that during the service in Delhi, they tried to rectify
the issue but the plaintiffs kept their power supply module. Witness has
written mails to defendant no.1 regarding the issue in the machine of
plaintiff. Witness deposed that it was correct that the machine in
question had manufacturing defect but the witness never informed
the plaintiff that there was a manufacturing defect. Witness again said
that he does not know whether they informed the plaintiff about the
manufacturing defect. It is wrong to suggest that the problem of dim
marking was never resolved. It is wrong to suggest that defendant no.2
and defendant no.1 are jointly and severally liable for the loss of the
plaintiff as defendant no.2 is an agent of defendant no.1 in India.
26 On 24.11.2016, following issues were framed by the Court:-
1.Whether the plaintiff is entitled to the recovery as asked for in the plaint? If yes, the interest thereof? OPP
2. Relief.
Now I shall decide issue number 1:
Whether the plaintiff is entitled to the recovery as asked for in the plaint? If yes, the interest thereof? OPP CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 30 of 42 27 During the course of final arguments it was argued by the plaintiff that the present case arises out of breach of contract and misrepresentation committed by the defendants. Plaintiff sought to purchase a very expensive and premium laser hall marking machine from the defendants. The machine supplied by the defendant no. 1 was claimed to be of poor quality. Foundation of this case is based on the law of breach of contract. The machine supplied to the plaintiff never performed in the manner in which it was presumed. The section of "Maintenance Free" in the brochure Ex. PW1/3 shows the commitment on behalf of the sellers that the doide had a life of 10,000 hours or more. This categorical commitment made in the brochure itself shows that this is a case of misrepresentation and false advertisement. Advertisement on the brochure Ex. PW1/3 has been made jointly by both the defendants. Brochure was printed and issued by defendant no. 1 but the same was specifically endorsed and forwarded through an authentic stamp of defendant no. 2 company. This has been admitted and acknowledged in cross examination of question no. 10 and 11 of defence witness no. 1. Cost of the machine as per the admitted invoice dated 19.06.2008 Ex. PW1/4 is 21,000/- Euros.
Ex. PW1/4 i.e. Invoices has been admitted by defendant no. 2 during the cross examination of PW1. The replacement of the Doide of the same was suggested by the service engineer by the defendant no. 2. The average life of the doide is 10,000/- hours but in the present case, the diode only operated for 1523 hours and then stopped working. Plaintiff paid a sum of Rs. 3,00,868/- through RTGS on 27.09.2010 to defendant no. 2. The proof CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 31 of 42 of payment of this RTGS is Ex. PW1/5 and Ex. PW1/6 which have been admitted by defendant no. 2 during cross examination of PW1. Even after spending additional money on the diode, the machine did not function and left with no other option, the machine was packed and sent to office of defendant no. 2 in Mumbai on 08.10.2010. After repairs, the machine was dispatched back on 09.10.2010. But problems in the machine continued to exist and were not rectified even after sending the same to Mumbai, infact, after the machine was received back from Mumbai, new problems started cropping up which did not exist earlier. The customer service report dated 20.10.2010 Ex. Pw1/8 clearly highlights the content of the machine. Ex. PW1/18 was prepared by the site engineer of defendant no. 2 and signatures of both site engineers and the managing director of the plaintiff are there on the customer service report. Infact the contents of service report Ex. PW1/18 as stated by the site engineer of defendant no. 2 are that "installed the machine and LAN cable was not sent from Mumbai so used customer LAN cable but seems not to working properly. Old diode is with customer. After payment for replacing the new diode on 27.09.2010, laser machine has been installed on 20.10.2010 with a unit of 58.7 which unit needs to be explained because the old diode was replaced when the machine shown a unit of 1532.7, as per quantum equipment company Ltd., the diode has a life of 10,000/- hours which still needs to be clarified to us. Moreover, the laser installed is not satisfactory as there were previously (1) the absence of original LAN cables has been sanctioned by the Engineer. (2) The Q. switch does not connect with the machine on one CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 32 of 42 time and is based on hit and trial. (3) There are errors message like (I) no entities on purview feature and (ii) laser not ready. Over all machine has many pending issues that needs to be rectified. The resonator has been replaced by quantum company by telling him on phone but problem part has not been shown to us."
28 Defendant no. 2 while cross-examining the plaintiff has admitted Ex. PW1/18 and therefore, the same has been proved. The plaintiff through emails dated 23.10.2010 and 25.10.2010 requested defendant no. 2 to rectify the problems which existed. The service engineers of defendant no. 2 again visited the plaintiff company. This time instead of diode problem it was stated that the PC server is malfunctioning and the same might need a change. These circumstances have been captured in the two emails mentioned above and these are Ex. Pw1/10. Customers service report dated 04.11.2010 which is Ex. PW1/14 shows the admission of mistakes committed by the defendants and Ex. PW1/14 has been admitted in the evidence of defendant no. 2 during the cross examination of PW1. The relevant portion is as follows:
"not subjecting the same level of marketing intensity as the case when the diode was not replaced, clear concession of in the original case machine still needs lot of work and needs paper rectification."
29 Email dt. 30.11.2010 written by defendant no. 2 to defendant no. 1 is the best evidence of entire litigation. In this email, a categorical admission has been made by defendant no. 2 to defendant no. 1 that the machine is not working properly and is unable to give appropriate laser CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 33 of 42 marking even after the replacement of the diode. The relevant part of the email is:-
" Dear Marco, we do hope that you might have noted series of communication and report on all attempts made by our technician for above customer. The laser diode module is replaced from our new stock received through last shipment and the marking seems poor. We need to know other remedy or suggestion to test the laser diode supplied by you. Old diode module collected from customer is already shipped to Italy. Please note that we would like to resolve the marking issue for our customer at the earliest and hope that you will suggest proper suggestion to over come the present circumstances. You may also expedite the shipment of our parts to rectify the laser units in time. Your immediate response in this matter is highly appreciated and hope will confirm the same.
With best regards, D.M. Musale"
30 Counsel for defendant no. 2 has very conveniently denied this email during the cross examination of PW1. But a bare perusal of this email Ex. PW1/9 shall clearly show that this email was sent acknowledging the case of the plaintiff. A perusal of cross examination of the sole plaintiff witness will show that it has not elicited anything contrary to the deposition of PW1. Infact, defendant no. 2 gave a suggestion to PW1 which is as under:
"It is wrong to suggest that defendant no. 2 provided best service apart CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 34 of 42 from any manufacturing defect in the machine. Therefore, by this own admission, defendant no. 2 through above mentioned suggestion has admitted that manufacturing defect exists in the machine which is beyond any cure. In question no. 35 also in the cross examination of DW1, DW1 which is the sole witness of defendant no. 2 has categorically admitted that the machine in question did have the manufacturing defect. DW1 in its cross examination has admitted that 12 months warranty period was not mentioned in any of the contract or flyer (advertisement) of the machine. Even assuming that in usual cases, warranty is for 12 months, the same cannot be applicable in the present case as the present case is of the manufacturing defect which has been proved on record. Reliance is placed upon the case of "TATA Motors Vs Rajesh Tyagi and Him Motors Show Room".
31 The said judgment passed by Hon'ble NCDRC (National commission for Dispute Redressal commission). Right from the beginning, the defendant no. 1 has simply chosen not to reply to the grievances raised by the plaintiff. Defendant no. 1 also failed to reply to the emails sent by the plaintiff. Defendant no. 1 simply sold the machine, appropriated the proceeds and did not bother to deal with the problems faced by the customers. Defendant no. 1 did not bother to participate in the present proceedings. Defendant no. 2 was acting on behalf of defendant no. 1. Delivery of machine was made through defendant no. 2 and it was defendant no. 2 who had imported the same from defendant no.
1. All the emails written to both defendants have been replied by CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 35 of 42 defendant no. 2 which clearly shows the creation and subsistence of the agency between the defendant no. 1 and defendant no. 2. In para no. 13 of written statement of defendant no. 2, it is stated that defendant no. 2 is not the supplier or the manufacturer but only an agent of defendant no.1. The flyer (advertisement) of the machine printed and issued by defendant no. 1 had the stamp of defendant no. 2 which shows that defendant no. 1 was acting through defendant no. 2 in India.
32 This stamp can be seen on page no. 6 of the evidence affidavit. The advertisement on the brochure Ex. PW1/3 has been made by jointly by defendant nos. 1 and 2. Although, the brochure was printed and issued by defendant no. 1, same was specifically endorsed and forwarded through an authentic stamp of defendant no. 2 company. All the customer service reports in this case have been exhibited by defendant no. 2 which shows that defendant no. 2 was acting on behalf of defendant no. 1 in India. Email dated 11.11.2010 written by defendant no. 2 to the plaintiff shows that defendant no. 2 has been treating defendant no. 1 as its partner. The machine was imported directly to Mumbai not to Delhi by defendant no. 2 and the entire process of customer clearance has been done by defendant no. 2. Defendant no. 2 got the machine shipped to Delhi and got it installed on the premises of plaintiff company. Defence witness no. 1 has given an evasive answer to the question "Whether defendant no. 2 was receiving the retainership amount from defendant no. 1 during his cross examination. Question no. 8 of the cross examination of DW1 is the relevant question which has been evaded by DW1 from giving a direct CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 36 of 42 answer. It clearly goes to show that the defendant no. 2 was indeed receiving retainership amount on permanent basis. Therefore, it is clear that the defendant no. 2 is acting as an agent of defendant no. 1 as the defendant no. 1 is situated at abroad, therefore, defendant no. 2 squarely falls in exception of Section 230 of the Indian contract Act which says as follows:
"230. Agent cannot personally enforce, nor be bound by, contracts on behalf of principal. - In the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them.
33 Presumption of contract to contrary - Such a contract shall be presumed to exist in the following cases:
1) where the contract is made by an agent for the sale or purchase of goods for a merchant resident abroad;
2) where the agent does not disclose the name of his principal;
3) where the principal, though disclosed, cannot be sued."
34 Para no. 19 of the Evidence affidavit of PW1 gives computation details as to how the plaintiff is entitled to a total amount of RS. 40,15,871 alongwith interest future and pendentelite. 35 Admittedly by both the parties there is no clause of any warranty or guarantee regarding the machine or any of its parts. The brochure Ex.PW1/3 which is an admitted document given by defendant CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 37 of 42 no.2 says that the Diode has a working life in excess of 10,000 hours. There is no separate contract with respect to warranty or guarantee of either the machine or its parts. Counsel for plaintiff submits that plaintiff is suing the defendants for damages not only under contract law but also for tortuous liability. Document Ex. PW1/6, is proof of payment made to defendant no. 2 for purchase of diode. This payment of Rs. 3,00,840 is admitted by defendant no. 2 but it is contended that this three lacs was retained by defendant no. 2 on account of octroi charges, import charges and custom clearance etc. but counsel for plaintiff submits that if for arguments sake it is admitted that even it were true, defendant no. 2 has not filed any counter claim or claimed set off in the present suit which may entitled them to adjust these rupees three lacs paid by the plaintiff to defendant no. 2 for replacement of the faulty diode which faulty diode has been admitted by defendant no. 2. It is submitted that there is no bill on record, either filed or proved by defendant no. 2 that these octroi charges or other amounts were due and payable by the plaintiff. 36 Document Ex. PW1/7 is an email dated 19.10.2010 written by plaintiff to the plaintiff itself. So this email is not of any significance to this case.
37 Document Ex. PW1/8 is customer service report dated 20.10.2010. Service engineer of defendant no. 2 is the author of this report. The service report says, " that the machine even after its repair does not seem to be working properly and the old diode is with the customer. After payment for replacing the new diode on 27.09.2010 the CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 38 of 42 laser machine has been installed on 20.10.2010 with a reading of 58.7 which needs to be explained because the old diode was replaced when the machine already showed 1532.7 as per defendant no. 2. Diode has a life of 10,000 hours which needs to be clarified to us. Moreover, the laser installation is not as satisfactory ............ . Overall machine has many pending issues that needs to be rectified. The resonator has been replaced as quantum company Ltd. (defendant no. 2) has told to me on phone but the problem part has not been shown to us."
38 Document Ex. PW1/9 is a copy of email dated 23.10.2010 written by plaintiff to defendant no. 1 in which the problem with the machine has been explained by the plaintiff to the defendant no. 1. 39 Document Ex. PW1/10 is a copy of email dated 25.10.2010 written by plaintiff to defendant no. 2. This email has been denied by the defendant no. 2 but apart from simple denial, defendant no. 2 has produced no evidence to doubt the authenticity or genuineness of Ex. PW1/10.
40 Document Ex. PW1/14 is another customer service report which has been admittedly signed by service engineer of defendant no. 2 in which it is written "changed the old power supply with new one. Installed the old CPU. Marking is not satisfactory, same level of marking intensity as the case was when the diode was not replaced, clear case of wrong diagnosis in the original case. Machine still needs a lot of work and needs proper rectification.
41 During the course of arguments, counsel for defendant no. 2 CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 39 of 42 admitted email Ex. PW1/19 written by defendant no. 2 to defendant no. 1. Contents of the email are a matter of record. As per this email, the problem in the diode as well as the machine could not be rectified despite best efforts of defendant no. 2.
42 Affidavit under Section 65 B of evidence act certifying the authenticity of all the email communication between the plaintiff and defendant nos. 1 and 2 is Ex. PW1/24. All the emails filed by the plaintiff stand proved. Some of these emails have also been admitted by defendant number 2. It has been admitted by defendant number 2 that there is a manufacturing defect in the machine sold by defendant number 1 to the plaintiff. Therefore, in case of a latent manufacturing defect, warranty or guarantee does not matter because if a machine is defective right from the very beginning or suffers from a latent manufacturing defect, then even if the warranty or guarantee expires, the vendor would still be under a legal obligation to either replace the defective machine with a new one or to refund the entire money/purchase value of the machine to the vendee. In the present case, the plaintiff always asked for the replacement of the machine or in the alternative to be refunded back the entire purchase value of the machine. As per the plaintiff, the machine was bought from defendant number 1 at a cost of ₹ 18 Lacs. After the appreciation, its value is estimated at ₹ 14.40 lakhs. In the opinion of the court, the plaintiff has proved his case to the satisfaction of the court on the scale of preponderance of probabilities. All the evidence led by the parties and their pleadings have been discussed above in detail. Even defendant CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 40 of 42 number 2 admits that despite the best efforts they were not able to rectify the problems in the machine. Admittedly defendant number 2 agents of defendant number 1 and were responsible for the maintenance and after sales service of the machine. The proviso to section 230 of the contract act is clearly applicable in the present case and the defendant number 1 and 2 are jointly and severally liable to pay damages and other charges to the plaintiff.
43 Now, it has to be seen as to how much amount has to be refunded or awarded to the plaintiff in the present case. Admittedly, after the deposition of 2 years, the plaintiff has himself valued the return price of the machine at ₹ 14.40 lakhs. Apart from this, the plaintiff has also proved that he is entitled to be return back the purchase value of the new replacement diode which also did not function properly after the replacement of the old diode which comes to rupees 300868/-. The total of this amount comes to ₹ 17,40,868/-.
44 So far as regards, the loss of monthly income of ₹ 1.5 lakhs per month is concerned, the plaintiff has not filed any proof in support of this fact that the monthly income of the plaintiff was ₹ 1.5 lakhs the court of this machine. Therefore this amount of ₹ 1.5 lakhs per month which comes to a total of ₹ 7.5 lakhs in aggregate cannot be awarded to the plaintiff. Similarly the plaintiff has also not proved as to how the plaintiff arrived at a figure of rupees four lakhs on account of grievous mental harassment suffered at the hands of the defendants. Therefore this amount also cannot be awarded to the plaintiffs. Plaintiffs have also not filed proof CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 41 of 42 of spending amount of ₹ 50,000 towards the charges as alleged for litigating this case. This amount also cannot be granted to the plaintiff. Therefore, in view of my above mentioned observations and discussions, plaintiff is entitled to ₹ 17,40,868/- as a principal sum. Plaintiff is also held entitled to interest at the rate of 12% on the principal sum.
Relief.
45 In view of the above-mentioned discussions, plaintiff is held entitled to recovery of ₹ 17, 40, 868 (seventeen lakhs forty thousand eight sixty-eight) as a principal sum. Plaintiff is also granted an interest at the rate of 12% per annum from the date of institution of the suit till the date of its actual realization. The decree to amount can be recovered jointly and severally by the plaintiff from the defendants.
Costs of the suit are also awarded in favour of the plaintiff. Decree sheet be prepared accordingly. File be consigned to record room after due compliance.
Digitally signed by SUNIL SUNIL BENIWAL
BENIWAL Date: 2018.12.21
Announced in the open Court on 16:17:22 +0530
21st day of December, 2018 (SUNIL BENIWAL)
ADJ-02, Central,THC/Delhi
CS No 619692/16 Radiant Hall Marking vs Lasit Lighting Marking Page 42 of 42